Lithia Motors expects up to $35 million in 3Q unadjusted net income

Article by Christian A., on October 15, 2014

Lithia Motors Inc. is expecting to post a surge in unadjusted net income in the third quarter of 2014, helped by better new-vehicle sales, service and parts business and F&I revenue. According to the company, its third-quarter unadjusted net income would be between $34 million and $35 million, compared to $31 million in the same period in 2013.

The preliminary results does not include costs tied to Lithia’s recent acquisition of DCH Auto Group Inc. Lithia disclosed that revenue from continuing operations jumped 21 percent to $1.3 billion from $1.1 billion a year earlier.

The company, however, disclosed that its operating income for the quarter was mitigated partly because of shrinking used-car profit margins due to a drop in used-car values. Analysts at RBC Capital Markets remarked that Lithia’s results indicates a shift in the used-vehicle pricing market that may add “some incremental pressure” to the used-vehicle gross profit performance across the auto industry.

Lithia chief executive CEO Bryan DeBoer said in a statement that the company’s top-line revenue, new vehicle sales, service and parts, and F&I per unit exceeded expectations. He noted that used vehicle margins were around 130 basis points lower than anticipated, no thanks to declining used vehicle values.

DeBoer remarked that used-car same-store sales jumped 13 percent. On a continuing operations basis, Lithia is expecting a full-year revenue of between $5.2 billion and $5.4 billion, with new-vehicle sales and used-car sales jumping 35 and 32 percent, respectively.

The company also expects a jump in service body and parts sales to about 34 percent. Lithia expects 2014 F&I gross profit of $1,170 per unit. [source: automotive news - sub. required]

If you liked the article, share on:

Comments

Recommended

We’re willing to bet that the Bentley Bentayga is not the first thing that comes to mind for most people who are into off-roading and outdoor activities. It just doesn’t...
by - November 23, 2017
The other day, it was confirmed that Volvo will finally bring the XC40 to US soil, where it will first make an appearance at the 2017 Los Angeles Auto Show....
by - November 23, 2017
There is no question that the new BMW M5 (F90) high performance sports sedan is more powerful, faster and more enticing than the previous model. But for interested customers in...
by - November 23, 2017
Following the Tesla Roadster’s electrifying revelation on Thursday, Musk’s highly ambitious goals have skyrocketed when he tweeted about his future plans for the new sports car. Well, kind of. The...
by - November 23, 2017
Earlier in November at the 2017 SEMA Show in Vegas is when Hennessey unwrapped the Venom F5 to all of us. But it was actually first introduced as a concept...
by - November 22, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries