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UPDATE 2-Group 1 Automotive profit tops estimates
April 27, 2010 / 11:34 AM / in 7 years

UPDATE 2-Group 1 Automotive profit tops estimates

* Q1 shr $0.44 vs $0.42 estimate

* Revenue up 16.8 percent, same-store sales rose 17.4 pct

* Strong March helps boost profit, revenue (Adds CEO comment, details on acquisitions, March sales)

DETROIT, April 27 (Reuters) - Group 1 Automotive Inc (GPI.N), the No. 4 U.S dealership group, posted a quarterly profit that beat Wall Street estimates as auto sales rebounded from last year’s slide.

First-quarter net profit fell to $8 million, or 34 cents a share, from $8.4 million, or 37 cents a share, a year earlier. Excluding one-time items, the company’s profit came to 44 cents a share, beating the average Wall Street estimate of 42 cents, as compiled by Thomson Reuters I/B/E/S.

Total revenue rose 16.8 percent to $1.19 billion.

Earl J. Hesterberg, Group 1 president and chief executive, said the earnings were “fueled by an improved industry selling environment late in the first quarter.”

Toyota sales in 2009 made up nearly 40 percent of Group 1’s overall new vehicle sales.

March U.S. auto sales hit a seven-month high led by Toyota’s 41 percent surge after the world’s top automaker sustained falling sales in January and February due to massive safety recalls.

Group 1 profit on an adjusted earnings of $10.4 million, or 44 cents per share, was up 121 percent from an adjusted $4.7 million, or 20 cents per diluted share, in the first quarter of 2009.

Group 1 also on Tuesday announced acquisition of an Audi dealership in Columbia, South Carolina. The deal closed on Monday, the company said. The store is expected to generate $14.5 million of annual revenue and joins a Group 1 BMW dealership also in Columbia, the state’s capital.

So far this year, Group 1 has added eight franchises expected to generate $242 million of annual revenue.

The dealership group now owns and operates 138 franchises at 102 dealerships selling 32 brands of vehicles, including six franchises at three dealerships in Britain.

The adjusted first-quarter results exclude $2.5 million, or 10 cents per diluted share, associated with the early redemption of Group 1’s 8.25 percent senior subordinated notes in 2010.

The adjusted results from a year ago exclude a net after-tax gain of $3.7 million, or 17 cents per diluted share, on gains on debt redemptions partially offset by a loss incurred on a dealership disposition, the company reported. (Reporting by Bernie Woodall; Editing by Derek Caney and Maureen Bavdek)

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