Sonic automotive reports record third quarter results
Charlotte, n.c.--(business wire)--sonic automotive, inc. (“sonic automotive,” “sonic” or the “company”) (nyse:sah), one of the nation’s largest automotive retailers, today reported financial results for the third quarter and nine months ended september 30, 2022. key highlights record third quarter revenues of $3.4 billion, up 12% year-over-year; record third quarter gross profit of $580.7 million, up 23% year-over-year record third quarter net income of $87.3 million ($2.23 per diluted share) selling, general and administrative (“sg&a”) expenses as a percentage of gross profit of 68.7% (62.4% on a franchised dealerships segment basis, an increase of 220 basis points year-over-year) record third quarter total finance & insurance (“f&i”) gross profit per retail unit of $2,477, up 5% year-over-year echopark revenues of $607.8 million, down 8% year-over-year; record third quarter echopark gross profit of $48.6 million, up 88% year-over-year during the third quarter of 2022, sonic repurchased approximately 3.1 million shares of its class a common stock (or 8% of total class a and class b shares outstanding as of june 30, 2022) for an aggregate purchase price of approximately $151.5 million, resulting in $481.0 million of remaining share repurchase authorization during the nine months ended september 30, 2022, sonic repurchased approximately 5.2 million shares of its class a common stock (or 13% of total class a and class b shares outstanding as of december 31, 2021) for an aggregate purchase price of approximately $245.2 million sonic's board of directors approved a 12% increase to the company's quarterly cash dividend, to $0.28 per share, payable on january 13, 2023 to all stockholders of record on december 15, 2022 commentary david smith, chairman and chief executive officer of sonic automotive, stated, “our quarterly results reflect another period of solid financial performance, including record third quarter revenues, gross profit and earnings per share. during the third quarter, we continued to see persistent consumer demand for new vehicles and sustained growth in our parts and service business, driving all-time record fixed operations gross profit. these trends have carried over from the first half of 2022, in spite of a challenging used vehicle environment and macroeconomic headwinds such as inflation, rising interest rates, and ongoing global new vehicle supply chain constraints. we believe sonic’s ability to successfully navigate this environment demonstrates the strength of our diversified model and our unwavering commitment to generating long-term value for our key stakeholders.” jeff dyke, president of sonic automotive, commented, “in the third quarter, we continued to strategically expand echopark’s nationwide distribution network. this expansion has been achieved both by growing geographically and through the launch of our new ecommerce platform, which was successfully rolled out this past june to 100% of our nationwide traffic at echopark.com. for the third quarter, omnichannel sales through our new ecommerce platform accounted for 31% of echopark’s retail unit sales volume, compared to 19% last quarter, as more guests continued to utilize our enhanced, omnichannel purchase experience. in addition to our growing digital presence, our new store openings during the quarter expanded the echopark automotive brand reach to over 50% of the u.s. population. we remain committed to the expansion of the echopark automotive brand and, with our progress to date, we remain well on track to reach 90% of the u.s. population by 2025.” heath byrd, chief financial officer of sonic automotive, added, “despite supply chain challenges and today’s economic climate, our teammates continued to drive strong revenue and earnings performance throughout our organization. at the same time, our team has maintained its focus on cash flow generation and proactively managing expenses. we have made great progress related to the integration of the rfj auto acquisition and expect we will achieve further earnings synergies in future periods. based on our strong financial performance, solid cash position, ample sources of liquidity and our present macroeconomic outlook, we believe sonic remains well-positioned to build long-term value and deliver returns to our stockholders.” third quarter 2022 segment highlights the financial measures discussed below are results for the third quarter of 2022 with comparisons made to the third quarter of 2021, unless otherwise noted. franchised dealerships segment operating results include: same store revenues up 3%; same store gross profit up 5% same store retail new vehicle unit sales volume down 6%; same store retail new vehicle gross profit per unit up 28%, to $6,571 same store retail used vehicle unit sales volume down 12%; same store retail used vehicle gross profit per unit down 9%, to $1,669 same store parts, service and collision repair gross profit up 10%; same store customer pay gross profit up 12%; same store warranty gross profit up 7%; same store gross margin down 30 basis points, to 49.9% same store f&i gross profit down 5%; all-time record quarterly reported franchised dealerships segment f&i gross profit per retail unit of $2,473, up 7% on a trailing quarter cost of sales basis, franchised dealerships segment new vehicle inventory had approximately 18 days’ supply, and franchised dealerships segment used vehicle inventory had approximately 31 days’ supply same store revenues up 3%; same store gross profit up 5% same store retail new vehicle unit sales volume down 6%; same store retail new vehicle gross profit per unit up 28%, to $6,571 same store retail used vehicle unit sales volume down 12%; same store retail used vehicle gross profit per unit down 9%, to $1,669 same store parts, service and collision repair gross profit up 10%; same store customer pay gross profit up 12%; same store warranty gross profit up 7%; same store gross margin down 30 basis points, to 49.9% same store f&i gross profit down 5%; all-time record quarterly reported franchised dealerships segment f&i gross profit per retail unit of $2,473, up 7% on a trailing quarter cost of sales basis, franchised dealerships segment new vehicle inventory had approximately 18 days’ supply, and franchised dealerships segment used vehicle inventory had approximately 31 days’ supply echopark segment operating results include: echopark revenues of $607.8 million, down 8% year-over-year; record third quarter echopark gross profit of $48.6 million, up 88% year-over-year echopark retail used vehicle unit sales volume of 15,422, down 27% year-over-year echopark retail used vehicle unit sales volume was comprised of 81% 1-4-year old vehicles and 19% 5-plus-year old vehicles echopark segment loss of $29.9 million and adjusted ebitda* loss of $21.4 million (including market expansion-related losses of $6.3 million and $5.7 million, respectively) on a trailing quarter cost of sales basis, echopark segment used vehicle inventory had approximately 57 days’ supply (40 days for echopark-branded locations, excluding locations opened during the third quarter) echopark revenues of $607.8 million, down 8% year-over-year; record third quarter echopark gross profit of $48.6 million, up 88% year-over-year echopark retail used vehicle unit sales volume of 15,422, down 27% year-over-year echopark retail used vehicle unit sales volume was comprised of 81% 1-4-year old vehicles and 19% 5-plus-year old vehicles echopark segment loss of $29.9 million and adjusted ebitda* loss of $21.4 million (including market expansion-related losses of $6.3 million and $5.7 million, respectively) on a trailing quarter cost of sales basis, echopark segment used vehicle inventory had approximately 57 days’ supply (40 days for echopark-branded locations, excluding locations opened during the third quarter) * please refer to the discussion and reconciliation of non-gaap financial measures below. dividend sonic’s board of directors approved a 12% increase to the company's quarterly cash dividend, to $0.28 per share, payable on january 13, 2023 to all stockholders of record on december 15, 2022. third quarter 2022 earnings conference call senior management will hold a conference call today at 11:00 a.m. (eastern). investor presentation and earnings press release materials will be accessible beginning prior to the conference call on the company’s website at ir.sonicautomotive.com. to access the live webcast of the conference call, please go to ir.sonicautomotive.com. for telephone access to this conference call, please register in advance using this link: https://www.netroadshow.com/events/login?show=893f08a9&confid=42803 after registering, you will receive a confirmation that includes dial-in numbers and a unique conference call access code and pin for entry. registration remains available through the live call; however, to ensure you are connected for the full call we suggest registering at least 10 minutes before the start of the call. a conference call replay will be available following the call for 14 days at ir.sonicautomotive.com. about sonic automotive sonic automotive, inc., a fortune 500 company based in charlotte, north carolina, is on a quest to become the most valuable automotive retailer and service brand in america. our company culture thrives on creating, innovating, and providing industry-leading guest experiences, driven by strategic investments in technology, teammates, and ideas that ultimately fulfill ownership dreams, enrich lives, and deliver happiness to our guests and teammates. as one of the largest automotive retailers in america, we are committed to delivering on this goal while pursuing expansive growth and taking progressive measures to be the leader in this category. our new platforms, programs, and people are set to drive the next generation of automotive experiences. more information about sonic automotive can be found at www.sonicautomotive.com and ir.sonicautomotive.com. about echopark automotive echopark automotive is one of the fastest growing and most comprehensive retailers of nearly new pre-owned vehicles in america today. our rapid growth plan is expected to bring our unique business model to 90% of the u.s. population by 2025, utilizing one of the most innovative technology-enabled sales strategies in our industry. our approach provides a personalized and proven guest-centric buying process that consistently delivers award-winning guest experiences and superior value to car buyers nationwide, with savings of up to $3,000 versus the competition. consumers have responded by putting echopark at number one in products, sales, and service based on google reviews between april 2021 through april 2022, while receiving the 2021 consumer satisfaction award from dealerrater. echopark’s nationwide growth will continue to leverage the unique and preferred experience centers in-market with a best-in-class shopping and online buying tool. echopark’s mission is in the name: every car, happy owner. this drives the experience for guests and differentiates echopark from the competition. more information about echopark automotive can be found at www.echopark.com. forward-looking statements included herein are forward-looking statements, including statements regarding echopark's future u.s. population coverage and future earnings synergies from the rfj auto acquisition. there are many factors that affect management’s views about future events and trends of the company’s business. these factors involve risks and uncertainties that could cause actual results or trends to differ materially from management’s views, including, without limitation, economic conditions in the markets in which we operate, supply chain disruptions and manufacturing delays, labor shortages, the impacts of inflation and increases in interest rates, new and used vehicle industry sales volume, future levels of consumer demand for new and used vehicles, anticipated future growth in our echopark segment, the success of our operational strategies, the rate and timing of overall economic expansion or contraction, the integration of the rfj auto acquisition, the effect of the covid-19 pandemic and related government-imposed restrictions on operations, and the risk factors described in the company’s annual report on form 10-k for the year ended december 31, 2021 and other reports and information filed with the united states securities and exchange commission (the “sec”). the company does not undertake any obligation to update forward-looking information, except as required under federal securities laws and the rules and regulations of the sec. non-gaap financial measures this press release and the attached financial tables contain certain non-gaap financial measures as defined under sec rules, such as adjusted ebitda. as required by sec rules, the company has provided reconciliations of these non-gaap financial measures to the most directly comparable gaap financial measures in the schedules included in this press release. the company believes that these non-gaap financial measures improve the transparency of the company’s disclosures and provide a meaningful presentation of the company’s results. sonic automotive, inc. results of operations (unaudited) results of operations - consolidated three months ended september 30, better / (worse) nine months ended september 30, better / (worse) 2022 2021 % change 2022 2021 % change (in millions, except per share amounts) revenues: retail new vehicles $ 1,373.1 $ 1,128.0 22 % $ 4,068.7 $ 3,715.2 10 % fleet new vehicles 32.0 18.9 69 % 70.0 50.9 38 % total new vehicles 1,405.1 1,146.9 23 % 4,138.7 3,766.1 10 % used vehicles 1,358.0 1,324.8 3 % 4,178.3 3,708.9 13 % wholesale vehicles 114.7 97.1 18 % 404.8 256.7 58 % total vehicles 2,877.8 2,568.8 12 % 8,721.8 7,731.7 13 % parts, service and collision repair 404.7 339.9 19 % 1,183.4 994.1 19 % finance, insurance and other, net 165.6 164.1 1 % 505.3 486.1 4 % total revenues 3,448.1 3,072.8 12 % 10,410.5 9,211.9 13 % cost of sales: retail new vehicles (1,209.6 ) (1,012.9 ) (19 )% (3,569.2 ) (3,412.8 ) (5 )% fleet new vehicles (30.7 ) (18.6 ) (65 )% (66.9 ) (50.0 ) (34 )% total new vehicles (1,240.3 ) (1,031.5 ) (20 )% (3,636.1 ) (3,462.8 ) (5 )% used vehicles (1,306.6 ) (1,304.6 ) — % (4,031.6 ) (3,623.1 ) (11 )% wholesale vehicles (116.8 ) (95.9 ) (22 )% (404.2 ) (250.1 ) (62 )% total vehicles (2,663.7 ) (2,432.0 ) (10 )% (8,071.9 ) (7,336.0 ) (10 )% parts, service and collision repair (203.7 ) (168.8 ) (21 )% (597.7 ) (492.2 ) (21 )% total cost of sales (2,867.4 ) (2,600.8 ) (10 )% (8,669.6 ) (7,828.2 ) (11 )% gross profit 580.7 472.0 23 % 1,740.9 1,383.7 26 % selling, general and administrative expenses (399.0 ) (321.4 ) (24 )% (1,188.8 ) (931.3 ) (28 )% depreciation and amortization (32.8 ) (25.2 ) (30 )% (94.0 ) (73.7 ) (28 )% operating income (loss) 148.9 125.4 19 % 458.1 378.7 21 % other income (expense): interest expense, floor plan (9.6 ) (3.3 ) (191 )% (20.6 ) (12.8 ) (61 )% interest expense, other, net (22.9 ) (9.8 ) (134 )% (65.1 ) (30.2 ) (116 )% other income (expense), net — (0.1 ) 100 % 0.1 0.1 64 % total other income (expense) (32.5 ) (13.2 ) (146 )% (85.6 ) (42.9 ) (100 )% income (loss) from continuing operations before taxes 116.4 112.2 4 % 372.5 335.8 11 % provision for income taxes for continuing operations - benefit (expense) (29.1 ) (27.5 ) (6 )% (93.1 ) (83.4 ) (12 )% income (loss) from continuing operations 87.3 84.7 3 % 279.4 252.4 11 % discontinued operations: income (loss) from discontinued operations before taxes — (0.3 ) 100 % — 0.2 (100 )% provision for income taxes for discontinued operations - benefit (expense) — 0.1 (100 )% — — — % income (loss) from discontinued operations — (0.2 ) 100 % — 0.2 (100 )% net income (loss) $ 87.3 $ 84.5 3 % $ 279.4 $ 252.6 11 % basic earnings (loss) per common share: earnings (loss) per share from continuing operations $ 2.28 $ 2.04 12 % $ 7.09 $ 6.07 17 % earnings (loss) per share from discontinued operations — (0.01 ) 100 % — 0.01 (100 )% earnings (loss) per common share $ 2.28 $ 2.03 12 % $ 7.09 $ 6.08 17 % weighted-average common shares outstanding 38.3 41.6 8 % 39.4 41.6 5 % diluted earnings (loss) per common share: earnings (loss) per share from continuing operations $ 2.23 $ 1.96 14 % $ 6.90 $ 5.81 19 % earnings (loss) per share from discontinued operations — (0.01 ) 100 % — 0.01 (100 )% earnings (loss) per common share $ 2.23 $ 1.95 14 % $ 6.90 $ 5.82 19 % weighted-average common shares outstanding 39.2 43.3 9 % 40.5 43.4 7 % dividends declared per common share $ 0.25 $ 0.12 108 % $ 0.62 $ 0.34 82 % nm = not meaningful franchised dealerships segment - reported three months ended september 30, better / (worse) nine months ended september 30, better / (worse) 2022 2021 % change 2022 2021 % change (in millions, except unit and per unit data) revenues: retail new vehicles $ 1,359.6 $ 1,124.5 21 % $ 4,047.1 $ 3,710.8 9 % fleet new vehicles 32.0 18.9 69 % 70.0 50.9 38 % total new vehicles 1,391.6 1,143.4 22 % 4,117.1 3,761.7 9 % used vehicles 842.4 750.3 12 % 2,568.1 2,173.3 18 % wholesale vehicles 75.8 64.1 18 % 261.2 183.2 43 % total vehicles 2,309.8 1,957.8 18 % 6,946.4 6,118.2 14 % parts, service and collision repair 404.7 339.9 19 % 1,183.4 994.1 19 % finance, insurance and other, net 125.8 111.8 13 % 382.1 333.5 15 % total revenues 2,840.3 2,409.5 18 % 8,511.9 7,445.8 14 % gross profit: retail new vehicles 160.7 114.9 40 % 494.5 302.1 64 % fleet new vehicles 1.3 0.3 333 % 3.1 0.9 244 % total new vehicles 162.0 115.2 41 % 497.6 303.0 64 % used vehicles 45.4 50.1 (9 )% 136.0 137.3 (1 )% wholesale vehicles (2.1 ) (2.0 ) (5 )% (3.0 ) 0.2 nm total vehicles 205.3 163.3 26 % 630.6 440.4 43 % parts, service and collision repair 201.0 171.1 17 % 585.7 501.9 17 % finance, insurance and other, net 125.8 111.8 13 % 382.1 333.5 15 % total gross profit 532.1 446.2 19 % 1,598.4 1,275.8 25 % selling, general and administrative expenses (332.0 ) (268.4 ) (24 )% (974.9 ) (794.1 ) (23 )% depreciation and amortization (25.8 ) (21.2 ) (22 )% (75.8 ) (62.3 ) (22 )% operating income (loss) 174.3 156.6 11 % 547.7 419.4 31 % other income (expense): interest expense, floor plan (6.6 ) (2.0 ) (230 )% (13.9 ) (9.2 ) (50 )% interest expense, other, net (21.4 ) (9.5 ) (125 )% (61.7 ) (29.2 ) (112 )% other income (expense), net — — — % 0.1 — nm total other income (expense) (28.0 ) (11.5 ) (143 )% (75.5 ) (38.3 ) (97 )% income (loss) before taxes 146.3 145.1 1 % 472.2 381.1 24 % add: impairment charges — — nm — — nm segment income (loss) $ 146.3 $ 145.1 1 % $ 472.2 $ 381.1 24 % unit sales volume: retail new vehicles 24,241 22,280 9 % 73,185 76,340 (4 )% fleet new vehicles 672 511 32 % 1,454 1,297 12 % total new vehicles 24,913 22,791 9 % 74,639 77,637 (4 )% used vehicles 26,647 26,274 1 % 81,881 82,060 — % wholesale vehicles 5,813 6,119 (5 )% 18,436 19,704 (6 )% retail new & used vehicles 50,888 48,554 5 % 155,066 158,400 (2 )% used-to-new ratio 1.07 1.15 (7 )% 1.10 1.06 4 % gross profit per unit: retail new vehicles $ 6,627 $ 5,153 29 % $ 6,757 $ 3,956 71 % fleet new vehicles $ 1,955 $ 773 153 % $ 2,132 $ 745 186 % total new vehicles $ 6,501 $ 5,055 29 % $ 6,667 $ 3,903 71 % used vehicles $ 1,704 $ 1,907 (11 )% $ 1,661 $ 1,673 (1 )% finance, insurance and other, net $ 2,473 $ 2,303 7 % $ 2,464 $ 2,105 17 % nm = not meaningful franchised dealerships segment - same store three months ended september 30, better / (worse) nine months ended september 30, better / (worse) 2022 2021 % change 2022 2021 % change (in millions, except unit and per unit data) revenues: retail new vehicles $ 1,177.4 $ 1,121.3 5 % $ 3,413.5 $ 3,699.4 (8 )% fleet new vehicles 27.0 18.9 43 % 57.9 51.0 14 % total new vehicles 1,204.4 1,140.2 6 % $ 3,471.4 $ 3,750.4 (7 )% used vehicles 736.4 747.4 (1 )% 2,210.9 2,165.2 2 % wholesale vehicles 58.8 63.9 (8 )% 196.9 182.7 8 % total vehicles 1,999.6 1,951.5 2 % 5,879.2 6,098.3 (4 )% parts, service and collision repair 373.6 338.7 10 % 1,080.5 990.5 9 % finance, insurance and other, net 105.6 111.2 (5 )% 314.6 332.2 (5 )% total revenues 2,478.8 2,401.4 3 % 7,274.3 7,421.0 (2 )% gross profit: retail new vehicles 136.9 114.3 20 % 413.8 300.6 38 % fleet new vehicles 1.0 0.4 150 % 2.4 0.9 167 % total new vehicles 137.9 114.7 21 % 416.2 301.5 38 % used vehicles 38.5 48.2 (20 )% 115.9 137.2 (16 )% wholesale vehicles (1.7 ) 0.8 (313 )% (2.3 ) 5.8 (140 )% total vehicles 174.7 163.7 7 % 529.8 444.5 19 % parts, service and collision repair 186.5 170.2 10 % 537.5 498.8 8 % finance, insurance and other, net 105.6 111.2 (5 )% 314.6 332.2 (5 )% total gross profit $ 466.8 $ 445.1 5 % $ 1,381.9 $ 1,275.5 8 % unit sales volume: retail new vehicles 20,829 22,208 (6 )% 61,247 76,073 (19 )% fleet new vehicles 574 511 12 % 1,232 1,297 (5 )% total new vehicles 21,403 22,719 (6 )% 62,479 77,370 (19 )% used vehicles 23,043 26,164 (12 )% 69,315 81,713 (15 )% wholesale vehicles 4,583 6,102 (25 )% 14,258 19,634 (27 )% retail new & used vehicles 43,872 48,372 (9 )% 130,562 157,786 (17 )% used-to-new ratio 1.08 1.15 (7 )% 1.11 1.06 5 % gross profit per unit: retail new vehicles $ 6,571 $ 5,147 28 % $ 6,756 $ 3,951 71 % fleet new vehicles $ 1,782 $ 773 131 % $ 1,968 $ 745 164 % new vehicles $ 6,443 $ 5,049 28 % $ 6,661 $ 3,897 71 % used vehicles $ 1,669 $ 1,844 (9 )% $ 1,672 $ 1,679 — % finance, insurance and other, net $ 2,406 $ 2,300 5 % $ 2,410 $ 2,106 14 % nm = not meaningful note: all currently operating franchised dealership stores are included within the same store group as of the first full month following the first anniversary of the store’s opening or acquisition. echopark segment - reported three months ended september 30, better / (worse) nine months ended september 30, better / (worse) 2022 2021 % change 2022 2021 % change (in millions, except unit and per unit data) revenues: retail new vehicles $ 13.5 $ 3.5 286 % $ 21.6 $ 4.4 391 % used vehicles 515.6 574.5 (10 )% 1,610.2 1,535.6 5 % wholesale vehicles 38.9 33.0 18 % 143.6 73.5 95 % total vehicles 568.0 611.0 (7 )% 1,775.4 1,613.5 10 % finance, insurance and other, net 39.8 52.3 (24 )% 123.2 152.6 (19 )% total revenues 607.8 663.3 (8 )% 1,898.6 1,766.1 8 % gross profit: retail new vehicles 2.8 — 100 % 5.0 0.3 nm used vehicles 6.0 (29.9 ) 120 % 10.7 (51.4 ) 121 % wholesale vehicles — 3.2 (100 )% 3.6 6.4 (44 )% total vehicles 8.8 (26.7 ) 133 % 19.3 (44.7 ) 143 % finance, insurance and other, net 39.8 52.3 (24 )% 123.2 152.6 (19 )% total gross profit 48.6 25.8 88 % 142.5 107.9 32 % selling, general and administrative expenses (67.0 ) (53.0 ) (26 )% (213.9 ) (137.2 ) (56 )% depreciation and amortization (7.0 ) (4.0 ) (75 )% (18.2 ) (11.4 ) (60 )% operating income (loss) (25.4 ) (31.2 ) 19 % (89.6 ) (40.7 ) (120 )% other income (expense): interest expense, floor plan (3.0 ) (1.3 ) (131 )% (6.7 ) (3.5 ) (89 )% interest expense, other, net (1.5 ) (0.3 ) (400 )% (3.4 ) (1.0 ) (233 )% total other income (expense) (4.5 ) (1.7 ) (165 )% (10.1 ) (4.6 ) (120 )% income (loss) before taxes (29.9 ) (32.9 ) 9 % (99.7 ) (45.3 ) (120 )% add: impairment charges — — nm — — nm segment income (loss) $ (29.9 ) $ (32.9 ) 9 % $ (99.7 ) $ (45.3 ) (120 )% unit sales volume: retail new vehicles 535 55 nm 705 69 nm used vehicles 15,422 21,255 (27 )% 47,025 62,186 (24 )% wholesale vehicles 2,450 3,492 (30 )% 8,793 9,231 (5 )% gross profit per unit: total used vehicle and f&i $ 2,880 $ 1,023 182 % $ 2,808 $ 1,618 74 % nm = not meaningful echopark segment - same market three months ended september 30, better / (worse) nine months ended september 30, better / (worse) 2022 2021 % change 2022 2021 % change (in millions, except unit and per unit data) revenues: retail new vehicles $ 3.4 $ 3.5 (3 )% $ 10.3 $ 4.4 134 % used vehicles 367.8 569.7 (35 )% $ 1,176.8 $ 1,529.7 (23 )% wholesale vehicles 29.6 33.0 (10 )% 121.1 73.5 65 % total vehicles 400.8 606.2 (34 )% 1,308.2 1,607.6 (19 )% finance, insurance and other, net 27.9 52.0 (46 )% 90.2 152.0 (41 )% total revenues 428.7 658.2 (35 )% 1,398.4 1,759.6 (21 )% gross profit: retail new vehicles 0.3 0.2 50 % 0.9 0.3 50 % used vehicles 0.1 (29.7 ) 100 % (11.3 ) (51.2 ) 78 % wholesale vehicles 0.1 3.3 (97 )% 3.6 6.5 (45 )% total vehicles 0.5 (26.2 ) 102 % (6.8 ) (44.4 ) 85 % finance, insurance and other, net 27.9 52.0 (46 )% 90.2 152.0 (41 )% total gross profit $ 28.4 $ 25.8 10 % $ 83.4 $ 107.6 (22 )% unit sales volume: retail new vehicles 45 55 (18 )% 126 69 83 % used vehicles 11,809 21,078 (44 )% 36,960 61,970 (40 )% wholesale vehicles 1,925 3,492 (45 )% 7,452 9,231 (19 )% gross profit per unit: total used vehicle and f&i $ 2,361 $ 1,028 130 % $ 2,125 $ 1,615 32 % nm = not meaningful note: all currently operating echopark stores in a local geographic market are included within the same market group as of the first full month following the first anniversary of the market's opening. consolidated selling, general and administrative ("sg&a") expenses - non-gaap reconciliation three months ended september 30, better / (worse) 2022 2021 change % change (in millions) reported: compensation $ 255.2 $ 206.2 $ (49.0 ) (24 )% advertising 21.1 16.7 (4.4 ) (26 )% rent 11.9 13.8 1.9 14 % other 110.8 84.7 (26.1 ) (31 )% total sg&a expenses $ 399.0 $ 321.4 $ (77.6 ) (24 )% reported: sg&a expenses as a % of gross profit: compensation 43.9 % 43.7 % (20 ) bps advertising 3.6 % 3.5 % (10 ) bps rent 2.0 % 2.9 % 90 bps other 19.2 % 18.0 % (120 ) bps total sg&a expenses as a % of gross profit 68.7 % 68.1 % (60 ) bps nine months ended september 30, better / (worse) 2022 2021 change % change (in millions) reported: compensation $ 774.1 $ 608.5 $ (165.6 ) (27 )% advertising 72.8 44.2 (28.6 ) (65 )% rent 38.3 41.2 2.9 7 % other 303.6 237.4 (66.2 ) (28 )% total sg&a expenses $ 1,188.8 $ 931.3 $ (257.5 ) (28 )% items of interest: long term compensation charges (4.4 ) $ — total sg&a adjustments $ (4.4 ) $ — adjusted: total adjusted sg&a expenses $ 1,184.4 $ 931.3 $ (253.1 ) (27 )% reported: sg&a expenses as a % of gross profit: compensation 44.5 % 44.0 % (50 ) bps advertising 4.2 % 3.2 % (100 ) bps rent 2.2 % 3.0 % 80 bps other 17.4 % 17.1 % (30 ) bps total sg&a expenses as a % of gross profit 68.3 % 67.3 % (100 ) bps items of interest: long term compensation charges (0.3 )% — % total effect of adjustments (0.3 )% — % adjusted: total adjusted sg&a expenses as a % of gross profit 68.0 % 67.3 % (70 ) bps franchised dealerships segment - sg&a expenses - non-gaap reconciliation three months ended september 30, better / (worse) 2022 2021 change % change (in millions) reported: compensation $ 216.2 $ 176.6 $ (39.6 ) (22 )% advertising 10.5 6.4 (4.1 ) (64 )% rent 10.1 11.9 1.8 15 % other 95.2 73.5 (21.7 ) (30 )% total sg&a expenses $ 332.0 $ 268.4 $ (63.6 ) (24 )% reported: sg&a expenses as a % of gross profit: compensation 40.6 % 39.6 % (100 ) bps advertising 2.0 % 1.4 % (60 ) bps rent 1.9 % 2.7 % 80 bps other 17.9 % 16.5 % (140 ) bps total sg&a expenses as a % of gross profit 62.4 % 60.2 % (220 ) bps nine months ended september 30, better / (worse) 2022 2021 change % change (in millions) reported: compensation $ 657.2 $ 529.7 $ (127.5 ) (24 )% advertising 26.2 19.8 (6.4 ) (32 )% rent 31.9 36.2 4.3 12 % other 259.6 208.4 (51.2 ) (25 )% total sg&a expenses $ 974.9 $ 794.1 $ (180.8 ) (23 )% items of interest: long term compensation charges $ (4.4 ) $ — total sg&a adjustments $ (4.4 ) $ — adjusted: total adjusted sg&a expenses $ 970.5 $ 794.1 $ (176.4 ) (22 )% reported: sg&a expenses as a % of gross profit: compensation 41.1 % 41.5 % 40 bps advertising 1.6 % 1.6 % — bps rent 2.0 % 2.8 % 80 bps other 16.3 % 16.3 % — bps total sg&a expenses as a % of gross profit 61.0 % 62.2 % 120 bps items of interest: long term compensation charges (0.3 )% — % total effect of adjustments (0.3 )% — % adjusted: total adjusted sg&a expenses as a % of gross profit 60.7 % 62.2 % 150 bps echopark segment - sg&a expenses three months ended september 30, better / (worse) 2022 2021 change % change (in millions) reported: compensation $ 39.0 $ 29.6 $ (9.4 ) (32 )% advertising 10.6 10.3 (0.3 ) (3 )% rent 1.8 1.9 0.1 5 % other 15.6 11.2 (4.4 ) (39 )% total sg&a expenses $ 67.0 $ 53.0 $ (14.0 ) (26 )% reported: sg&a expenses as a % of gross profit: compensation 80.2 % 114.7 % 3,450 bps advertising 21.8 % 39.9 % 1,810 bps rent 3.7 % 7.4 % 370 bps other 32.2 % 43.4 % 1,120 bps total sg&a expenses as a % of gross profit 137.9 % 205.4 % 6,750 bps nine months ended september 30, better / (worse) 2022 2021 change % change (in millions) reported: compensation $ 116.9 $ 78.8 $ (38.1 ) (48 )% advertising 46.6 24.4 (22.2 ) (91 )% rent 6.4 5.0 (1.4 ) (28 )% other 44.0 29.0 (15.0 ) (52 )% total sg&a expenses $ 213.9 $ 137.2 $ (76.7 ) (56 )% reported: sg&a expenses as a % of gross profit: compensation 82.0 % 73.0 % (900 ) bps advertising 32.7 % 22.6 % (1,010 ) bps rent 4.5 % 4.6 % 10 bps other 30.9 % 27.0 % (390 ) bps total sg&a expenses as a % of gross profit 150.1 % 127.2 % (2,290 ) bps earnings per share from continuing operations - non-gaap reconciliation three months ended september 30, 2022 three months ended september 30, 2021 weighted- average shares amount per share amount weighted- average shares amount per share amount (in millions, except per share amounts) diluted earnings (loss) and shares from continuing operations 39.2 $ 87.3 $ 2.23 43.3 $ 84.7 $ 1.96 nine months ended september 30, 2022 nine months ended september 30, 2021 weighted- average shares amount per share amount weighted- average shares amount per share amount (in millions, except per share amounts) diluted earnings (loss) and shares from continuing operations 40.5 $ 279.4 $ 6.90 43.4 $ 252.4 $ 5.82 pre-tax items of interest: long term compensation charges $ 4.4 $ — total pre-tax items of interest $ 4.4 $ — adjusted diluted earnings (loss) and shares from continuing operations 40.5 $ 283.8 $ 7.01 43.4 $ 252.4 $ 5.82 adjusted ebitda - non-gaap reconciliation three months ended september 30, 2022 three months ended september 30, 2021 franchised dealerships segment echopark segment discontinued operations total franchised dealerships segment echopark segment discontinued operations total (in millions) net income (loss) $ 87.3 $ 84.5 provision for income taxes 29.1 27.5 income (loss) before taxes $ 146.3 $ (29.9 ) $ — $ 116.4 $ 145.1 $ (32.9 ) $ (0.2 ) $ 112.0 non-floor plan interest 19.9 1.5 — 21.4 8.8 0.3 — 9.1 depreciation and amortization 27.3 7.0 — 34.3 21.9 4.0 — 25.9 stock-based compensation expense 3.8 — — 3.8 3.7 — — 3.7 long-term compensation charges — — — — — 0.5 — 0.5 loss (gain) on franchise and real estate disposals 0.5 — — 0.5 (0.1 ) (0.4 ) — (0.5 ) adjusted ebitda $ 197.8 $ (21.4 ) $ — $ 176.4 $ 179.4 $ (28.5 ) $ (0.2 ) $ 150.7 nine months ended september 30, 2022 nine months ended september 30, 2021 franchised dealerships segment echopark segment discontinued operations total franchised dealerships segment echopark segment discontinued operations total (in millions) net income (loss) $ 279.4 $ 252.6 provision for income taxes 93.1 83.4 income (loss) before taxes $ 472.2 $ (99.7 ) $ — $ 372.5 $ 381.1 $ (45.3 ) $ 0.2 $ 336.0 non-floor plan interest 58.0 3.2 — 61.2 26.8 1.0 — 27.8 depreciation & amortization 79.6 18.1 — 97.7 64.6 11.4 — 76.0 stock-based compensation expense 12.4 — — 12.4 11.2 — — 11.2 long-term compensation charges 4.4 — — 4.4 — 1.5 — 1.5 loss (gain) on franchise and real estate disposals (0.5 ) — — (0.5 ) (0.4 ) (0.4 ) — (0.8 ) adjusted ebitda $ 626.1 $ (78.4 ) $ — $ 547.7 $ 483.3 $ (31.8 ) $ 0.2 $ 451.7
