CHARLOTTE - Sonic Automotive Inc . (NYSE: NYSE:SAH) reported its first-quarter earnings, surpassing analyst expectations for adjusted earnings per share (EPS) but falling short on revenue.
The company's adjusted EPS came in at $1.36, which was $0.04 higher than the analyst estimate of $1.32. However, total revenues reached $3.4 billion, down from the consensus estimate of $3.45 billion and a 3% decline from the same period last year.
The automotive retailer also experienced a decrease in year-over-year (YoY) net income, which dropped by 12% to $42.0 million, and a 3% decrease in total gross profit to $536.2 million. Despite these declines, the company's EchoPark Segment reported a record first-quarter total gross profit of $52.6 million, a significant increase of 34% YoY.
Chairman and CEO David Smith expressed pride in the company's performance, highlighting the growth in adjusted EPS year-over-year. He attributed this success to Sonic Automotive's diversified business model and commitment to returning capital to stockholders. Smith also noted the EchoPark Segment's results, which exceeded targets for breakeven adjusted EBITDA and achieved a record quarterly adjusted EBITDA of $7.3 million, up 120% YoY.
The Franchised Dealerships Segment saw mixed results, with same-store revenues up by 1% but same-store gross profit down by 5%. The company saw a 5% increase in same-store retail new vehicle unit sales volume, although gross profit per unit decreased by 32%. In contrast, the EchoPark Segment experienced a 14% decrease in revenues but managed an impressive 34% increase in gross profit.
CFO Heath Byrd commented on the company's financial position, noting $847 million in total liquidity, including $335 million in cash and floor plan deposits. Byrd believes the company is well-positioned to adapt to market conditions and succeed in 2024 and beyond.
Sonic Automotive's Board of Directors approved a quarterly cash dividend of $0.30 per share, payable on July 15, 2024, to stockholders of record as of June 14, 2024.
While the company did not provide specific guidance for the upcoming quarters, the overall tone of the management commentary was optimistic, with expectations of maintaining positive quarterly EchoPark Segment adjusted EBITDA for the remainder of 2024 and mitigating the effects of margin normalization in the Franchised Dealerships Segment.
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