This compares to net income of $54.9 million ($2.84 per diluted share) and adjusted net income of $45.9 million ($2.38 per diluted share) in the prior year quarter.
Net income for the second quarter 2020 was adjusted for a $1.2 million ($0.05 per diluted share) legal settlement gain. Net income for the second quarter 2019 was adjusted for an $11.7 million ($0.45 per diluted share) gain on a dealership divestiture and a $0.3 million ($0.01 per diluted share) gain on the sale of real estate.
"We delivered a very strong quarter and proved out the resilience and the flexibility of our business model by delivering a record operating margin of 5.7% and a record low SG&A as a percentage of gross profit of 62.7% in an 11.3 million SAAR environment," said David Hult, Asbury's president and CEO.
"Our focus on gross profit combined with our cost restructuring efforts allowed us to remain pro-active and committed to long term growth by moving forward with acquiring 12 Park Place luxury franchises in the Dallas-Fort Worth market under more favorable terms than the prior agreement," Hult continued. "This acquisition will add approximately $1.7 billion in expected annualized revenues and transform our total portfolio to 49% luxury stores. With the addition of Park Place, Asbury will be a stronger, more diversified company.
"Finally, I want to thank our teammates across our store network for their unwavering commitment and emphasis on safety during this pandemic; our performance is a direct result of their hard work and service," Hult concluded.
Second Quarter 2020 Highlights:
- New gross profit per vehicle up 33% to $1,924
- Used retail gross profit per vehicle up 10% to $1,717
- 20% of used sales transacted online
- SG&A as a percentage of gross profit decreased 530 basis points to 62.7%
- Income from operations as percentage of revenue increased 90 basis points to 5.7%
- Adjusted EPS increased 6%
- Entered into a definitive agreement to acquire Park Place Dealerships, one of the country's largest and most prominent luxury dealer groups
- Ended the quarter with total liquidity of $747 million and a net leverage ratio of 1.5x
Additional commentary regarding the second quarter results were provided during an earnings conference call July 28. The conference call can be accessed here. The replay will be available at this site for 30 days.
Source: Asbury Automotive Group