Penske Automotive Group, Inc. · NYSE:PAG
Penske Automotive — Q4 2018 Earnings Presentation
27 slides from Penske Automotive's earnings presentation, Feb 7, 2019
Slide 1: Fourth Quarter and Full Year 2018 Financial Results
Fourth Quarter and Full Year 2018 Financial Results
Slide 2: Forward-looking statements
Statements in this presentation may involve forward-looking statements, including forward-looking statements regarding Penske Automotive Group, Inc.’s financial results, future sales, earnings potential, and liquidity. Actual results may vary materially because of risks and uncertainties that are di
Slide 3: Diversification
Diversification FRANCHISED AUTOMOTIVE USED VEHICLE COMMERCIAL TRUCK TRUCK DISTRIBUTION TRANSPORTATION* DEALERSHIPS SUPERCENTERS DEALERSHIPS & POWER SYSTEMS • U.S. • CarSense (U.S.) • Premier Truck • Australia • Full-Service • U.K. Group Truck Leasing • CarShop (U.K.) • New Zealand • Germany • U.S. •
Slide 4: Q4 2018
Q4 2018 PENSKE
Slide 5: Q4 2018 Highlights
Q4 2018 Highlights • Total automotive units increased 0.8% to 120,869 • New units -7.7% • Used units +9.6% • Record revenue increased +0.8% to $5.4 billion • Income from continuing operations of $97.8 million and earnings per share of $1.15. • Record adjusted income from continuing operations +9.6%
Slide 6: Q4 2018 Key Takeaways
Q4 2018 Key Takeaways Retail Automotive Commercial Trucks Capital Allocation • Record Q4 Adjusted • 14.1% Same-Store Unit • Increased the dividend Income From Cont. Ops* Growth for the 31st consecutive and Adjusted EPS* quarter • 13.9% Same-Store Retail • Retail unit sales +0.8% to Revenue Growth •
Slide 7: Q4 2018 Key Performance Metrics
Q4 2018 Key Performance Metrics ACTUAL CHANGE Ex. F/X Same-Store Units New Vehicles 55,290 (7.0%) N/A Used Vehicles 58,257 +2.6% N/A Total 113,547 (2.3%) N/A Same-Store Retail Revenue New $2,271.2 (6.0%) (5.0%) Used $1,576.6 +5.0% +6.7% Finance & Insurance $142.0 +0.7% +2.0% Service & Parts $525.2 +
Slide 8: 12M 2018
12M 2018
Slide 9: 12M 2018 Highlights
12M 2018 Highlights • Retailed 518,506 new and used automotive units, +3.4% • Total revenue $22.8 billion, +6.5% • Same-store retail automotive revenue +3.4% • Increased earnings before taxes by 10% to $604 million • Income from continuing operations of $470.5 million and earnings per share of $5.52
Slide 10: 12M 2018 Highlights
12M 2018 Highlights • Completed acquisitions, or opened new dealerships, representing $775 million in estimated annualized revenue • Increased the dividend paid to shareholders each quarter providing a sector leading 3.2% yield • Returned $190 million, or 40% of income from continuing operations, to
Slide 11: 12M 2018 Revenue & EBT
12M 2018 Revenue & EBT Revenue Revenue Earnings Before Tax $22.8 Billion $22.8 Billion $604 Million 56% 92% 65% 35% 6% 10% 2% 25% 9% Retail North America Retail Commercial Other* Automotive United Kingdom Truck Other *Includes equity income from joint venture investments, including Penske Truck Leas
Slide 12: Appendix
APPENDIX PENSKE Automotive
Slide 13: Appendix Table of Contents
Appendix Table of Contents Page # Recent Acquisitions and Open Points 14 Retail Automotive Brand Mix 15 Stand Alone Used Vehicle SuperCenters 16-18 Retail Commercial Truck Dealerships 19-21 Penske Truck Leasing 22-24 Non-GAAP Reconciliations 25-27 13
Slide 14: Recent Acquisitions and Open Points
Recent Acquisitions and Open Points $775 Million in Estimated Annual Revenue Annualized ($ in millions) Revenue Acquisitions: The Car People Used Supercenter (U.K.) $375 Lexus of Austin (Austin, TX) $185 Mercedes-Benz Stores (Ferrara & Bologna, Italy) $75 Lexus of Lakeway (Lakeway, TX) $70 Hamilton
Slide 15: 2018 Retail Automotive Brand Mix
2018 Retail Automotive Brand Mix (% of Total Automotive Dealership Revenue for 12M 2018) 6% 1% 13% 4% 23% 3% 3% 10% Used Vehicle 6% SuperCenters 3% 1% 9% 7% 2% 9% • Premium – 70% • Used Vehicle SuperCenters – 6% • Volume Non-U.S. – 22% • U.S. Big 3 – 2% 15
Slide 16: Stand-Alone Used Supercenters
STAND-ALONE USED SUPERCENTERS
Slide 17: Used Vehicle SuperCenters
Used Vehicle SuperCenters 12M 2018 12M 2017 Chg. Used Units Retailed 71,013 40,501 +75.3% Revenue (in millions) $1,268.8 $711.5 +78.3% Avg. Transaction Price $14,913 $14,519 +2.7% Gross Per Unit Retailed $1,080 $1,138 (5.1%) F&I Per Unit Retailed $1,041 $1,238 (15.9%) Total Variable Gross/Unit $2,12
Slide 18: Stand-Alone Supercenters Revenue & Gross
Stand-Alone Supercenters Revenue & Gross 12M YTD 2018 Revenue Gross Profit 3% 39% 83% 10% 6% 40% 18% 1% Used Wholesale S&P F&I 18
Slide 19: North America Retail Commercial Truck Dealerships
NORTH AMERICA RETAIL COMMERCIAL TRUCK DEALERSHIPS
Slide 20: Premier Truck Group
Premier Truck Group Truck Sales Service Parts Body Shop • 2018 revenue of $1.4 billion • 3rd largest Dealership Group for Daimler Trucks N.A. • New and used retail sales; service and parts operations • 20 locations in Georgia, Oklahoma, Tennessee, Texas and Canada 20
Slide 21: Premier Truck Revenue & Gross
Premier Truck Revenue & Gross 12M YTD 2018 Service & Parts Drives Profitability Revenue Gross Profit 8% 6% 63% 27% 19% 67% 3% 5% New Used S&P F&I Other 21
Slide 22: Penske Truck Leasing
PENSKE TRUCK LEASING
Slide 23: Penske Truck Leasing Overview
Penske Truck Leasing Overview Full-Service Contract Truck Logistics Leasing Maintenance Rental Services • $14.6 billion total assets Operating Revenue Logistics 25% • $8.4 billion in total revenue 47% 28% • Over 299,000 vehicles on the road Rental Lease & Maintenance 23
Slide 24: PTL Performance Summary
PTL Performance Summary Q4 2018 Total Revenue +19% 12M 2018 Total Revenue +16% ($ in Billions) ($ in Billions) $1.9 $2.2 $8.4 $1.6 $7.1 $6.4 Q4 '16 Q4 '17 Q4 '18 12M '16 12M '17 12M '18 Q4 Net Income +9% 12M 2018 Net Income +10% ($ in Millions) ($ in Millions) $120 $131 $448 $109 $406 $389 Q4 '16 Q4
Slide 25: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS PENSKE
Slide 26: EBITDA and Adjusted EBITDA Reconciliation
EBITDA and Adjusted EBITDA Reconciliation Three Mos. Ended Twelve Mos. Ended December 31, December 31, ($ in Millions) 2018 2017 2018 2017 Net Income $97.2 $328.6 $470.3 $612.8 Depreciation $26.5 $25.1 $103.7 $95.1 Other Interest $28.0 $28.2 $114.7 $107.4 Income Taxes $29.6 ($200.8) $134.3 ($64.8) (
Slide 27: Income/EPS from Continuing Operations
Income/EPS from Continuing Operations ($ in Millions, except per share amounts) The following tables reconcile reported income from continuing operations and earnings per share to adjusted income from continuing operations and adjusted earnings per share for the three months and twelve months ended
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