Sonic Automotive, Inc. · NYSE:SAH
Sonic Automotive — Q3 2009 Earnings Presentation
26 slides from Sonic Automotive's earnings presentation, Oct 27, 2009
Slide 1: Sonic Automotive
Slide 2: Cautionary Notice - Forward-Looking Statements
This presentation contains statements that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are not historical facts, but only predictions by our company an
Slide 3: Third Quarter 2009 Earnings Review
Third Quarter 2009 Earnings Review October 27, 2009
Slide 4: Sonic Automotive Q3 2009 Quarter in Review
Sonic Automotive Q3 2009 Quarter in Review Financial Review Operations Review Closing Comments
Slide 5: Overall Results - Q3
Overall Results - Q3 Made money, generated cash Operating margin was 3% Continued to leverage cost reductions New inventory in good shape Cleaned up balance sheet Benefited from the CARS program: Store traffic increased for both new and used Able to reduce inventory balances
Slide 6: Financial Review
Financial Review Amounts in millions, except per share data * - In 2009, adjusted to exclude impairment charges, 6.0% Note derivative mark-to-market gain and 4.25% Notes derecognition gain. In 2008, adjusted to exclude impairment charges and hurricane physical damage and lease exit accruals. See app
Slide 7: Sequential Operating Results
Sequential Operating Results * - Adjusted to exclude impairment charges, 6.0% Note derivative mark-to-market gains, restructuring costs related to 6.0% Notes issuance and 4.25% Notes derecognition gain. See appendix for reconciliation to GAAP / Reported amounts.
Slide 8: EBITDA - All Operations
EBITDA - All Operations (amounts in millions) Stack 1 SAAR Column 3 Column 4 Column 5 Column 6 Column 7 Column 8 Column 9 Column 10 Column 11 Column 12 Column 13 Column 14 Column 15 Column 16 2007 241 16.2 2008 151 13.2 Q3 2008 38 12.9 Q4 2008 9 10.4 Q1 2009 36 9.5 Q2 2009 47 9.6 Q3 2009 53 11.5 Not
Slide 9: SG&A Expenses
Q3 2008 Q2 2009 Q3 2009 All Other 0.694 0.662 0.657 Rent & Related 0.133 0.135 0.134 SG&A 79.7% 82.7% 79.1% Total SG&A expenses were down 5.0% or $10.9 million from the prior year Excluding rent, all other cost was down 370bps, on flat gross profit. Reductions were made in most cost categories * - E
Slide 10: Capitalization
Capitalization Adjustments represent payment of 6.0% Notes at par on October 28, 2009, repayment of outstanding 4.25% Notes and amounts outstanding on the revolver with the balance in restricted cash. Excludes discount/premium and derivative adjustments. $152 Million reduction, or 20% from YE
Slide 11: Debt Maturity Profile
yy Debt Maturity Profile Maturity Principal at (qrmmnts inion) 9/30/2009 2010 201120122013 2014 New 5.0% Convertible Notes $172.5 Oct 2014 Revolving Credit Facility $20.6 Feb 2010 Aug 2013 8.625% Notes $ 275.0
Slide 12: Debt Covenants
Debt Covenants Compliant with all covenants
Slide 13: Capital Spending
Capital Spending (Amounts in millions)
Slide 14: Employee Metrics
Employee Metrics Dec Jan Feb Mar Apr May June Jul Aug Engagement 117 117 117 118 118 118 119 119 119 ASI 10/1/2008 11/1/2008 12/1/2008 1/1/2009 2/1/2009 3/1/2009 4/1/2009 5/1/2009 6/1/2009 7/1/2009 8/1/2009 9/1/2009 Turnover 0.527 0.505 0.508 0.484 0.467 0.449 0.432 0.414 0.398 0.382 0.362 0.353 Tur
Slide 15: New Vehicle Market Share
New Vehicle Market Share * Bps difference between Sonic and the local market competition. 130 10 45
Slide 16: Cash for Clunkers
Cash for Clunkers New volume benefited (non luxury) Used volume not impacted Cash For Clunkers represented approximately 28% of July and August new vehicle unit volume Program increased walk-in and online traffic Customers visited the store to learn more about the Cash For Clunkers program; as a res
Slide 17: Used Vehicles
sani) Used Vehicles Q3:09 Q3:08 Change Retail Volume YOY % better/worse) Used Retail Margin Used to New Ratio Days Supply
Slide 18: Fixed Operations Overview
Fixed Operations Overview 100 bps Improvement
Slide 19: Summary
Summary Business has steadily improved despite a relatively flat operating environment Used business continues to grow Successfully repositioned our balance sheet Company is positioned for future growth
Slide 20: Appendix
yD R——— APPENDIX
Slide 21: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information
Slide 22: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information
Slide 23: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information
Slide 24: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information
Slide 25: Reconciliation of Non-GAAP Financial Information
Reconciliation of Non-GAAP Financial Information
Slide 26: Interest Expense
Interest Expense Revolver deferred loan costs higher due to May refinancing activities Going into 2010 - expect revolver deferred loan cost amortization to be more in line with Q3 2008 amount $11.4M benefit results from MTM adjustment on derivative liability resulting from redemption notice to 6.0%