Penske Automotive Reports Fourth Quarter Results

News provided by

Penske Automotive Group, Inc.

11 Feb, 2016, 11:55 GMT

Completes Most Profitable Year in Company History

BLOOMFIELD HILLS, Michigan, Feb. 11, 2016 /PRNewswire/ --

Fourth Quarter 2015

Twelve Months 2015
  •  Revenue Increases 11.2% to $4.9 Billion
  • Revenue Increases 11.9% to $19.3 Billion
  • Same-store Retail Revenue Increases 3.6%, Excluding Foreign Exchange 5.4%
  • Same-store Retail Revenue Increases 4.8%, Excluding Foreign Exchange 8.3%
  • Income from Continuing Operations Attributable to Common Shareholders Increases 4.5% to $72.7 Million as Compared  to Adjusted 2014
  • Income from Continuing Operations Attributable to Common Shareholders Increases 13.0% to $329.6 Million as Compared to Adjusted 2014
  • Earnings Per Share from Continuing Operations Attributable to Common Shareholders Increases 3.8% to $0.81 as Compared to Adjusted 2014
  • Earnings Per Share from Continuing Operations Attributable to Common Shareholders Increases 13.6% to $3.67 as Compared to Adjusted 2014
  • EBITDA Increases 5% to $144.2 Million as Compared to Adjusted 2014
  • EBITDA Increases 13.2% to $639.3 Million as Compared to Adjusted 2014

Penske Automotive Group, Inc. (NYSE: PAG), an international transportation services company, announced today record fourth quarter and full year results as compared to adjusted 2014. For the three months ended December 31, 2015, income from continuing operations attributable to common shareholders increased 4.5% to $72.7 million, and related earnings per share increased 3.8% to $0.81 when compared to adjusted figures in the same period last year.  Income from continuing operations and related earnings per share for the three and twelve months ended December 31, 2014, excludes a $16.0 million ($9.7 million after-tax) gain on investment. Total automotive retail units increased 11.9% and total revenue increased 11.2% to $4.9 billion. Excluding foreign exchange, total revenue increased 14.0%.  Same-store retail revenue increased 3.6%.  Excluding foreign exchange, same-store retail revenue increased 5.4%.

"The diversification provided by our business model continues to drive our business forward," said Penske Automotive Group Chairman Roger S. Penske. "Our U.K.-based retail automotive and U.S.-based commercial truck businesses produced exceptional results, and the stability of the parts and service business helped our business produce another solid quarter. We expect 2016 will be another solid year for both automotive and U.S. commercial truck sales."

Same-Store Automotive Retail Highlights of the Fourth Quarter

  • Same-Store Retail Unit Sales Increased 2.4% to 100,730
    • New unit retail sales +2.5%
    • Used unit retail sales +2.3%
  • Same-Store Retail Revenue Increased 3.6%
    • New +1.7%; Used +6.2%; Finance & Insurance +15.4%; Service and Parts +3.2%
    • +1.8% in the United States; +6.8% Internationally
    • Excluding f/x, same-store retail revenue increased 5.4%
  • Same-Store Average Transaction Price Per Unit
    • New $40,418; -0.8%
    • Used $28,157; +3.8%
  • Same-Store Average Gross Profit Per Unit
    • New $3,047, -$146;  Gross Margin 7.5%, -30 basis points
      • Excluding f/x $3,107, -$86; Gross Margin 7.6%, -20 basis points
    • Used $1,541, -$115; Gross Margin 5.5%, -60 basis points
      • Excluding f/x $1,573, -$83; Gross Margin 5.5%, -60 basis points
    • Finance & Insurance $1,205, +$136
      • Excluding f/x $1,224, +$155

Note: f/x = foreign exchange

For the twelve months ended December 31, 2015, total revenue increased 11.9% to $19.3 billion, including a 4.8% increase in same-store retail revenue. Excluding foreign exchange, total revenue increased 16.0%, while same-store retail revenue increased 8.3%. Total retail unit volume increased 8.3%, including 4.9% on a same-store basis. Income from continuing operations attributable to common shareholders increased 13.0% to $329.6 million and related earnings per share increased 13.6% to $3.67 when compared to adjusted figures in the same period last year as shown in the attached tables. For the twelve months ended December 31, 2015, exchange rates negatively impacted earnings per share attributable to common shareholders by $0.14.

U.S. Commercial Truck Operations
The company operates fourteen U.S. commercial truck dealerships under the "Premier Truck Group" brand name, including ten full-service dealerships offering primarily the Freightliner and Western Star brands. For the three months and twelve months ended December 31, 2015, Premier Truck Group generated $241.0 million and $944.1 million of revenue, and $35.9 million and $147.0 million of gross profit, respectively, principally through the retail sale of new/used medium and heavy-duty trucks and service/parts sales. Service and parts gross profit represents approximately 72.7% and 71.8% of total Premier Truck Group gross profit, respectively.  

Share Repurchases
During the three months ended December 31, 2015, the company acquired 571,313 shares of its common stock for approximately $27.0 million. For the twelve months ended December 31, 2015, the company acquired 854,313 shares of its common stock for $40.9 million.  In December 2015, the company's Board of Directors increased the authorization to repurchase shares, and as a result, the company has a current share repurchase authorization of approximately $200.0 million.

Acquisitions Update
For the twelve months ended December 31, 2015, the company acquired retail automotive franchises and U.S. commercial truck dealerships that are expected to generate approximately $500 million in estimated annualized revenue. In addition, the company acquired an additional 10% ownership interest in one of our Germany-based automotive joint ventures resulting in us owning 60% of this joint venture. As a result, we began consolidating an additional 27 dealerships into our financial results representing approximately $690 million in estimated annualized revenue.

Conference Call
Penske Automotive will host a conference call discussing financial results relating to the fourth quarter of 2015 on February 11, 2016, at 2:00 p.m. Eastern Standard Time. To listen to the conference call, participants must dial (800) 230-1093 - [International, please dial +1-612-332-0107]. The call will also be simultaneously broadcast over the Internet through the Investor Relations section of the Penske Automotive Group website. Additionally, an investor presentation relating to the fourth quarter 2015 financial results has been posted to the company's website. To access the presentation or to listen to the company's webcast, please refer to www.penskeautomotive.com.

About Penske Automotive
Penske Automotive Group, Inc., (NYSE:PAG) headquartered in Bloomfield Hills, Michigan, is an international transportation services company that operates automotive and commercial truck dealerships principally in the United States and Western Europe, and distributes commercial vehicles, diesel engines, gas engines, power systems and related parts and services principally in Australia and New Zealand. PAG employs more than 22,000 people worldwide and is a member of the Fortune 500 and Russell 2000. For additional information, visit the company's website at www.penskeautomotive.com.

Non-GAAP Financial Measures
This release contains certain non-GAAP financial measures as defined under SEC rules, such as earnings before interest, taxes, depreciation and amortization ("EBITDA") and adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"). The company has reconciled these measures to the most directly comparable GAAP measures in the release. The company believes that these widely accepted measures of operating profitability improve the transparency of the company's disclosures and provide a meaningful presentation of the company's results from its core business operations excluding the impact of items not related to the company's ongoing core business operations, and improve the period-to-period comparability of the company's results from its core business operations. These non-GAAP financial measures are not substitutes for GAAP financial results, and should only be considered in conjunction with the company's financial information that is presented in accordance with GAAP.

Caution Concerning Forward Looking Statements
Statements in this press release may involve forward-looking statements, including forward-looking statements regarding Penske Automotive Group, Inc.'s future sales potential. Actual results may vary materially because of risks and uncertainties that are difficult to predict. These risks and uncertainties include, among others: economic conditions generally, conditions in the credit markets and changes in interest rates and foreign currency exchange rates, adverse conditions affecting a particular manufacturer, including the adverse impact to the vehicle and parts supply chain due to natural disasters, recall or other disruptions that interrupt the supply of vehicles or parts to us, changes in consumer credit availability, the outcome of legal and administrative matters, and other factors over which management has limited control. These forward-looking statements should be evaluated together with additional information about Penske Automotive's business, markets, conditions and other uncertainties, which could affect Penske Automotive's future performance. These risks and uncertainties are addressed in Penske Automotive's Form 10-K for the year ended December 31, 2014, and its other filings with the Securities and Exchange Commission ("SEC"). This press release speaks only as of its date, and Penske Automotive disclaims any duty to update the information herein.

Find a vehicle:  http://www.penskecars.com 
Engage Penske Automotive:  http://www.penskesocial.com 
Like Penske Automotive on Facebook:  https://facebook.com/PenskeCars 
Follow Penske Automotive on Twitter:  https://twitter.com/Penskecarscorp 
Visit Penske Automotive on YouTube:  http://www.youtube.com/penskecars

Inquiries should contact:

J.D. Carlson
Executive Vice President and

Chief Financial Officer

Penske Automotive Group, Inc.
248-648-2810
jcarlson@penskeautomotive.com

Anthony R. Pordon
Executive Vice President Investor Relations
and Corporate Development

Penske Automotive Group, Inc.
248-648-2540
tpordon@penskeautomotive.com

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Statements of Income
(Amounts In Millions, Except Per Share Data)
(Unaudited)



Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

Increase/

(Decrease)

2015

2014

Increase/

(Decrease)

Revenue

$  4,921.3

$  4,425.6

11.2%

$

19,284.9

$ 17,232.0

11.9%

Cost of Sales

4,204.2

3,765.5

11.7%

16,417.4

14,652.8

12.0%

Gross Profit

$     717.1

$     660.1

8.6%

$

2,867.5

$   2,579.2

11.2%

SG&A Expenses

570.7

522.6

9.2%

2,223.0

2,008.6

10.7%

Depreciation

20.3

19.6

3.6%

78.0

70.2

11.1%

    Operating Income

$     126.1

$     117.9

7.0%

$

566.5

$      500.4

13.2%

Floor Plan Interest Expense

(11.8)

(12.3)

-4.1%

(44.5)

(46.5)

-4.3%

Other Interest Expense

(20.4)

(15.6)

30.8%

(69.4)

(52.8)

31.4%

Gain on Investment

---

16.0

         nm

---

16.0

             nm

Equity in Earnings of Affiliates

9.6

12.1

-20.7%

39.3

40.8

-3.7%

    Income from Continuing Operations Before Income Taxes

$     103.5

$     118.1

-12.4%

$

491.9

$      457.9

7.4%

Income Taxes

(29.8)

(37.4)

-20.3%

(158.0)

(153.1)

3.2%

    Income from Continuing Operations

$73.7

$       80.7

-8.7%

$

333.9

$      304.8

9.5%

Loss from Discontinued Operations, net of tax

(2.4)

(7.5)

nm

(3.5)

(14.7)

nm

    Net Income

$       71.3

$       73.2

-2.6%

$

330.4

$      290.1

13.9%

Less: Income Attributable to Non-Controlling Interests

1.0

1.4

-28.6%

4.3

3.4

26.5%

    Net Income Attributable to Common Shareholders

$       70.3

$       71.8

-2.1%

$

326.1

$      286.7

13.7%













Amounts Attributable to Common Shareholders:











Reported Income from Continuing Operations

$       73.7

$       80.7

-8.7%

$

333.9

$      304.8

9.5%

Less: Income Attributable to Non-Controlling Interests

1.0

1.4

-28.6%

4.3

3.4

26.5%

Income from Continuing Operations, net of tax

$       72.7

$       79.3

-8.3%

$

329.6

$      301.4

9.4%

Loss from Discontinued Operations, net of tax

(2.4)

(7.5)

             nm

(3.5)

(14.7)

             nm

Net Income Attributable to Common Shareholders

$       70.3

$       71.8

-2.1%

$

326.1

$      286.7

13.7%

Income from Continuing Operations Per Share

$       0.81

$       0.88

-8.0%

$

3.67

$          .34

9.9%

Income Per Share

$       0.78

$       0.80

-2.5%

$

3.63

$        3.17

14.5%

Weighted Average Shares Outstanding

89.8

90.3

-0.6%

89.8

90.4

-0.7%













nm – not meaningful











PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Condensed Balance Sheets
(Amounts In Millions)
(Unaudited)









December 31,

December 31,

2015

2014

Assets:


Cash and Cash Equivalents

$             62.4

$             36.3

Accounts Receivable, Net

782.3

707.1

Inventories

3,463.5

2,836.4

Other Current Assets

86.8

124.8

Assets Held for Sale

13.1

155.6

Total Current Assets

4,408.1

3,860.2

Property and Equipment, Net

1,495.8

1,331.6

Intangibles

1,730.8

1,657.0

Other Long-Term Assets

363.7

379.4

Total Assets

$        7,998.4

$        7,228.2




Liabilities and Equity:


Floor Plan Notes Payable

$        2,247.2

$        1,812.6

Floor Plan Notes Payable – Non-Trade

1,132.4

933.8

Accounts Payable

493.8

422.5

Accrued Expenses

308.5

316.0

Current Portion Long-Term Debt

29.2

37.2

Liabilities Held for Sale

6.2

108.2

Total Current Liabilities

4,217.3

3,630.3

Long-Term Debt

1,255.1

1,316.0

Other Long-Term Liabilities

691.1

600.7

Total Liabilities

6,163.5

5,547.0

Equity

1,834.9

1,681.2

Total Liabilities and Equity

$          7,998.4

$          7,228.2

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Operations
Selected Data
(Unaudited)









Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

2015

2014

Geographic Revenue Mix:






U.S.

61.7%

63.5%

61.2%

60.6%

U.K.

30.5%

31.3%

33.4%

34.9%

Other International

7.8%

5.2%

5.4%

4.5%

Total

100.0%

100.0%

100.0%

100.0%








Revenue: (Amounts in Millions)






Retail Automotive

$      4,568.8

$      4,162.2

$    17,896.3

$    16,657.5

U.S. Commercial Trucks

241.0

125.6

944.1

125.6

Commercial Vehicles Australia/Power Systems and Other

111.5

137.8

444.5

448.9

Total

$      4,921.3

$      4,425.6

$    19,284.9

$    17,232.0








Gross Profit: (Amounts in Millions)






Retail Automotive

$         653.7

$         610.3

$      2,608.0

$      2,477.4

U.S. Commercial Trucks

35.9

21.1

147.0

21.1

Commercial Vehicles Australia/Power Systems and Other

27.5

28.7

112.5

80.7

Total

$         717.1

$         660.1

$      2,867.5

$      2,579.2








Gross Margin:






Retail Automotive

14.3%

14.7%

14.6%

14.9%

U.S. Commercial Trucks

14.9%

16.8%

15.6%

16.8%

Commercial Vehicles Australia/Power Systems and Other

24.7%

20.8%

25.3%

18.0%

Total

14.6%

14.9%

14.9%

15.0%

PENSKE AUTOMOTIVE GROUP, INC.
Consolidated Operations
Selected Data
(Unaudited)









Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

Increase/

(Decrease)

2015

2014

Increase/

(Decrease)

Operating Items as a Percentage of Revenue:










Gross Profit

14.6%

14.9%

-30 bps

14.9%

15.0%

-10 bps

Selling, General and Administrative Expenses

11.6%

11.8%

 -20 bps

11.5%

11.7%

-20 bps

Operating Income

2.6%

2.7%

-10 bps

2.9%

2.9%

---

Inc. From Cont. Ops. Before Inc. Taxes

2.1%

2.7%

-60 bps

2.6%

2.7%

 -10 bps












Operating Items as a Percentage of Total Gross Profit:









Selling, General and Administrative Expenses

79.6%

79.2%

+40 bps

77.5%

77.9%

-40 bps

Operating Income

17.6%

17.9%

-30 bps

19.8%

19.4%

+40 bps

Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

Increase/ (Decrease)

2015

2014

Increase/ (Decrease)

(Amounts in Millions)










EBITDA*

$        144.2

$       153.3

-5.9%

$        639.3

$        580.9

10.1 %

Adjusted EBITDA*

$        144.2

$        137.3

5.0%

$        639.3

$        564.9

13.2%

Floorplan Credits

$            8.2

$            6.9

18.8%

$          32.0

$          28.8

11.1%

Rent Expense

$          51.9

$          49.1

5.7%

$        201.8

$        191.3

5.5%












* See the following Non-GAAP reconciliation table.







PENSKE AUTOMOTIVE GROUP, INC.
Retail Automotive Operations
Selected Data
(Unaudited)









Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

2015

2014

Retail Automotive Units:






New Retail

60,364

54,218

233,524

216,609

Used Retail

49,741

44,136

198,459

182,109

Total

110,105

98,354

431,983

398,718








Retail Automotive Revenue: (Amounts in Millions)






New Vehicles

$        2,338.4

$        2,209.9

$        9,208.9

$        8,698.8

Used Vehicles

1,364.8

1,197.3

5,425.5

4,971.1

Finance and Insurance, Net

122.2

105.2

478.3

436.0

Service and Parts

472.9

431.9

1,830.7

1,716.9

Fleet and Wholesale

270.5

217.9

952.9

834.7

Total Revenue

$        4,568.8

$        4,162.2

$      17,896.3

$      16,657.5








Retail Automotive Gross Profit: (Amounts in Millions)





New Vehicles

$           184.2

$           173.1

$           706.9

$           674.6

Used Vehicles

70.7

73.1

328.3

335.5

Finance and Insurance, Net

122.2

105.2

478.3

436.0

Service and Parts

273.7

257.8

1,084.0

1,021.6

Fleet and Wholesale

2.9

1.1

10.5

9.7

Total Gross Profit

$           653.7

$           610.3

$        2,608.0

$        2,477.4








Retail Automotive Revenue Per Vehicle Retailed:






New Vehicles

$         38,738

$         40,759

$         39,434

$         40,159

Used Vehicles

27,439

27,128

27,338

27,297








Retail Automotive Gross Profit Per Vehicle Retailed:






New Vehicles

$           3,050

$           3,193

$           3,027

$           3,115

Used Vehicles

1,422

1,656

1,654

1,842

Finance & Insurance

1,110

1,069

1,107

1,093

PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations

 Selected Data

(Unaudited)









Three Months Ended

December 31,

Twelve Months Ended


December 31,

2015

2014

2015

2014

Retail Automotive Revenue Mix Percentages:






New Vehicles

51.2%

53.1%

51.5%

52.2%

Used Vehicles

29.9%

28.8%

30.3%

29.8%

Finance and Insurance, Net

2.7%

2.5%

2.7%

2.6%

Service and Parts

10.4%

10.4%

10.2%

10.3%

Fleet and Wholesale

5.8%

5.2%

5.3%

5.1%

Total

100.0%

100.0%

100.0%

100.0%








Retail Automotive Gross Profit Mix Percentages:






New Vehicles

28.2%

28.4%

27.1%

27.2%

Used Vehicles

10.8%

12.0%

12.6%

13.5%

Finance and Insurance, Net

18.7%

17.2%

18.3%

17.6%

Service and Parts

41.9%

42.2%

41.6%

41.2%

Fleet and Wholesale

0.4%

0.2%

0.4%

0.5%

Total

100.0%

100.0%

100.0%

100.0%

Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

Increase/

(Decrease)

2015

2014

Increase/

(Decrease)

Retail Automotive Gross Margin:










New Vehicles

7.9%

7.8%

+10 bps

7.7%

7.8%

-10 bps

Used Vehicles

5.2%

6.1%

-90 bps

6.1%

6.7%

-60 bps

Service and Parts

57.9%

59.7%

  -180 bps

59.2%

59.5%

-30 bps

Fleet and Wholesale

1.1%

0.5%

+60 bps

1.1%

1.2%

-10 bps

Total Gross Margin

14.3%

14.7%

-40 bps

14.6%

14.9%

-30 bps

PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations

Selected Data

(Unaudited)









Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

2015

2014

Retail Automotive Revenue Mix:






Premium:






BMW / MINI

27%

28%

27%

27%

Audi

13%

13%

13%

13%

Mercedes-Benz

10%

11%

10%

11%

Land Rover

7%

5%

6%

5%

Porsche

5%

5%

5%

5%

Lexus

4%

4%

4%

4%

Ferrari / Maserati

2%

3%

3%

3%

Acura

1%

1%

1%

1%

Bentley

1%

1%

1%

1%

Others

2%

2%

2%

2%

Total Premium

72%

73%

72%

72%

Volume Non-U.S.:






Toyota

11%

11%

11%

11%

Honda

7%

7%

7%

8%

Volkswagen

3%

2%

3%

2%

Nissan

1%

1%

1%

1%

Others

2%

2%

2%

2%

Total Volume Non-U.S.

24%

23%

24%

24%

U.S.:






General Motors / Chrysler / Ford

4%

4%

4%

4%

Total

100%

100%

100%

100%








Retail Automotive Geographic Revenue Mix:






U.S.

61.1%

64.4%

60.6%

61.8%

U.K.

32.9%

33.3%

36.0%

36.1%

Other International

6.0%

2.3%

3.4%

2.1%

Total

100.0%

100.0%

100.0%

100.0%

PENSKE AUTOMOTIVE GROUP, INC.

Retail Automotive Operations

Same-Store

Selected Data

(Unaudited)









Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

2015

2014

Retail Automotive Same-Store Units:






New Retail

55,580

54,218

223,692

213,798

Used Retail

45,150

44,136

189,548

180,155

Total

100,730

98,354

413,240

393,953








Retail Automotive Same-Store Revenue: (Amounts in Millions)





New Vehicles

$        2,246.4

$        2,209.9

$        8,917.2

$        8,573.0

Used Vehicles

1,271.3

1,197.3

5,233.3

4,924.9

Finance and Insurance, Net

121.4

105.2

471.6

432.2

Service and Parts

445.8

431.9

1,759.6

1,693.9

Fleet and Wholesale

267.2

217.8

935.9

828.6

Total Revenue

$        4,352.1

$        4,162.1

$      17,317.6

$      16,452.6








Retail Automotive Same-Store Gross Profit: (Amounts in Millions)



New Vehicles

$           169.4

$           173.1

$           676.5

$           666.5

Used Vehicles

69.6

73.1

322.4

332.8

Finance and Insurance, Net

121.4

105.2

471.6

432.2

Service and Parts

263.5

257.7

1,051.7

1,008.9

Fleet and Wholesale

2.8

1.0

10.2

9.5

Total Gross Profit

$           626.7

$           610.1

$        2,532.4

$        2,449.9








Retail Automotive Same-Store Revenue Per Vehicle Retailed:





New Vehicles

$         40,418

$         40,759

$         39,864

$         40,099

Used Vehicles

28,157

27,128

27,609

27,337








Retail Automotive Same-Store Gross Profit Per Vehicle Retailed:





New Vehicles

$           3,047

$           3,193

$           3,024

$           3,117

Used Vehicles

1,541

1,656

1,701

1,847

Finance & Insurance

1,205

1,069

1,141

1,097

PENSKE AUTOMOTIVE GROUP, INC.

U.S. Commercial Truck Operations

Selected Data

(Unaudited)

Note: The Company's Retail U.S. Commercial Truck Operations were acquired in November 2014.  The following tables are presented for informational purposes. Same-store results are not applicable for the three month and twelve month periods ending December 31, 2015.









Three Months Ended

Twelve Months Ended

December 31, 2015

December 31, 2015

U.S. Commercial Truck Units:


New Retail

1,622

5,864

Used Retail

233

1,113

Total

1,855

6,977




U.S. Commercial Truck Revenue: (Amounts in Millions)


New Vehicles

$                        154.1

$                        572.5

Used Vehicles

12.0

58.7

Finance and Insurance, Net

1.7

6.7

Service and Parts

70.0

286.0

Lease, Rental & Wholesale

3.2

20.2

Total Revenue

$                        241.0

$                        944.1

U.S. Commercial Truck Gross Profit: (Amounts in Millions)


New Vehicles

$                            7.2

$                          26.8

Used Vehicles

0.6

5.4

Finance and Insurance, Net

1.7

6.7

Service and Parts

26.1

105.5

Lease, Rental & Wholesale

0.3

2.6

Total Gross Profit

$                          35.9

$                        147.0




U.S. Commercial Truck Revenue Per Vehicle Retailed:


New Vehicles

$                      95,020

$                      97,629

Used Vehicles

51,295

52,775




U.S. Commercial Truck Gross Profit Per Vehicle Retailed:


New Vehicles

$                        4,411

$                        4,576

Used Vehicles

2,398

4,810

Finance & Insurance

932

966

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Non-GAAP Reconciliations

(Unaudited)

The following table reconciles reported net income to earnings before interest, taxes, depreciation and amortization ("EBITDA") and adjusted earnings before interest, taxes, depreciation and amortization ("ADJUSTED EBITDA") for the three and twelve months ended December 31, 2015, and 2014:





Three Months Ended

Twelve Months Ended

December 31,

December 31,

2015

2014

Increase/

(Decrease)

2015

2014

Increase/

(Decrease)

(Amounts in Millions)











Net Income

$       71.3

$       73.2

-2.6%

$     330.4

$     290.1

13.9%

Add: Depreciation

20.3

19.6

3.6%

78.0

70.2

11.1%

     Other Interest Expense

20.4

15.6

30.8%

69.4

52.8

31.4%

     Income Taxes

29.8

37.4

-20.3%

158.0

153.1

3.2%

     Loss from Discontinued Operations, net of tax

2.4

7.5

nm

3.5

14.7

 nm

EBITDA

$     144.2

$     153.3

-5.9%

$     639.3

$     580.9

10.1%

Less: Gain on Investment (1)

---

16.0

nm

---

16.0

nm

Adjusted EBITDA

$     144.2

$     137.3

5.0%

$     639.3

$     564.9

13.2%













nm – not meaningful
























(1)     Represents a non-cash gain of $16.0 million ($9.7 million after-tax) relating to the revaluation at fair value of a previously held non-controlling interest in our U.S. commercial truck dealership business, of which we acquired a controlling interest in November 2014.

PENSKE AUTOMOTIVE GROUP, INC.

Consolidated Non-GAAP Reconciliations

(Unaudited)









The following table reconciles reported income from continuing operations to adjusted income from continuing operations for the three and twelve months ended December 31, 2015 and 2014:
























Three Months

Twelve Months







Ended December 31,

Ended December 31,







2015

2014

Increase/

(Decrease)

2015

2014

Increase/

(Decrease)






Income From Continuing Operations: (Amounts in Millions)

















Reported Income from Continuing Operations

$       72.7

$       79.3

-8.3%

$     329.6

$     301.4

9.4%






Less: Gain on Investment (1)

---

9.7

nm

---

9.7

nm






Adjusted Income from Continuing Operations

$        72.7

69.6

4.5%

$     329.6

$     291.7

13.0%

























Earnings Per Share (2):



















Reported Earnings Per Share from Continuing    Operations

$        0.81

$        0.88

-8.0%

$        3.67

$        3.34

9.9%






Less: Gain on Investment (1)

---

0.10

nm

---

0.10

nm






Adjusted Earnings Per Share from Continuing  Operations

$        0.81

$        0.78

3.8%

$        3.67

$        3.23

13.6%























nm – not meaningful
































(1)     Represents a non-cash gain of $16.0 million ($9.7 million after-tax) relating to the revaluation at fair value of a previously held non-controlling interest in our U.S. commercial truck dealership business, of which we acquired a controlling interest in November 2014.





(2)     Earnings per share amounts may not add up to total due to rounding.



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