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This excerpt taken from the AN 8-K filed Feb 11, 2010. AutoNation Reports 2009 Fourth Quarter and Full Year Results
FORT LAUDERDALE, Fla., (February 11, 2010) —AutoNation, Inc. (NYSE: AN), America’s largest automotive retailer, today reported 2009 fourth quarter GAAP net income from continuing operations of $62 million or $0.36 per share, compared to $73 million or $0.42 per share for the prior year. In the fourth quarter of 2009, the Company had a benefit from a tax adjustment of $13 million or $0.07 per share. In the fourth quarter of 2008, the Company had a net benefit of $51 million or $0.29 per share, related primarily to favorable tax items and gains on the repurchase of senior notes. After adjusting for these items as disclosed in the attached financial tables, adjusted net income from continuing operations for the 2009 fourth quarter was $50 million or $0.29 per share, compared to $23 million or $0.13 per share for the prior year, a 123% increase on a per-share basis. Fourth quarter 2009 revenue totaled $2.8 billion, compared to $2.6 billion in the year-ago period, an 8% increase, driven primarily by stronger new vehicle unit sales which increased 7%. In the fourth quarter, total U.S. industry new vehicle retail unit sales increased 6%, based on CNW Research data. Commenting on the fourth quarter, Mike Jackson, Chairman and Chief Executive Officer, said, “We delivered solid profitability in the fourth quarter, achieved our first year-over-year increase in new vehicle unit sales since the second quarter of 2005, and maintained the benefits of our actions taken in response to the economic downturn. By lowering our structural costs and debt levels and more efficiently managing our inventory, we were able to deliver solid EPS growth in a very difficult environment.”
AutoNation has three operating segments: Domestic, Import, and Premium Luxury. The Domestic segment is comprised of stores that sell vehicles manufactured by General Motors, Ford, and Chrysler; the Import segment is comprised of stores that sell vehicles manufactured primarily by Toyota, Honda, and Nissan; and the Premium Luxury segment is comprised of stores that sell vehicles manufactured primarily by Mercedes, BMW, and Lexus. Segment results for the fourth quarter were as follows:
(1) Segment income is defined as operating income less floorplan interest expense. For the full year ended December 31, 2009, the Company reported GAAP net income from continuing operations of $234 million or $1.32 per share, compared to a GAAP net loss from continuing operations of $1.2 billion or $6.82 per share for the prior year. After adjusting for certain items (including the goodwill and franchise rights impairment charges recorded in the prior year) as disclosed in the attached financial tables, adjusted net income from continuing operations for the full year ended December 31, 2009 was $204 million or $1.15 per share, compared to $180 million or $1.01 per share for the prior year. The Company’s revenue for the full year ended December 31, 2009 totaled $10.8 billion, down 20% compared to $13.4 billion in the prior year. Jackson also stated, “We responded to the dramatic decline in industry volumes, the Chrysler and GM bankruptcies, the credit crisis and staggering unemployment and delivered a full-year adjusted EPS increase of 14%. We are optimistic for the long-term prospects of the auto industry based on the successful restructuring of the domestic auto industry, the move to a demand-pull system and the rationalization of the dealer network. We agree with the view that volumes will be higher this year. Our planning assumption for 2010 industry new unit sales is 11.5 million units with a gradual increase in the selling rate over the course of the year.” The fourth quarter conference call may be accessed at 11:00 a.m. Eastern Time today by telephone at 888-769-8515 (pass code: AutoNation) or via the Internet (audio webcast) at http://www.AutoNation.com by clicking on the “About AutoNation” and then “Webcasts & Presentations.” A playback of the conference call will be available after 12:00 (noon) p.m. Eastern Time February 11, 2010 through February 19, 2010 by calling 866-487-7599 (pass code: 75300).
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