Penske Automotive Group Inc. (NYSE:PAG) filed Quarterly Report for the period ended 2010-09-30.
Penske Automotive Group Inc. has a market cap of $1.33 billion; its shares were traded at around $14.52 with a P/E ratio of 13.2 and P/S ratio of 0.1. PAG is in the portfolios of Ron Baron of Baron Funds, Chuck Royce of Royce& Associates, Mario Gabelli of GAMCO Investors, Murray Stahl of Horizon Asset Management, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:New vehicle retail sales revenue increased $77.5 million, or 5.8%, from 2009 to 2010. The increase is due to a $51.9 million increase from net dealership acquisitions, coupled with a $25.6 million, or 1.9%, increase in same store revenues. The same store revenue increase is due primarily to a $2,839, or 8.8%, increase in average selling prices per unit which increased revenue by $110.5 million, offset by the 6.3% decrease in retail unit sales, which decreased revenue by $84.9 million.
Retail gross profit from new vehicle sales decreased $0.5 million, or 0.4%, from 2009 to 2010. The decrease is due to a $4.5 million, or 4.0%, decrease in same store gross profit, offset by a $4.0 million increase from net dealership acquisitions. The same store decrease is due primarily to the 6.3% decrease in retail unit sales, which decreased gross profit by $7.1 million, offset by a $66, or 2.4%, increase in the average gross profit per new vehicle retailed, which increased gross profit by $2.6 million.
Retail gross profit from used vehicle sales decreased $2.4 million, or 4.0%, from 2009 to 2010. The decrease is due to a $3.4 million, or 5.7%, decrease in same store gross profit, offset by a $1.0 million increase from net dealership acquisitions. The decrease in same store gross profit is due to a $378, or 16.4%, decrease in average gross profit per used vehicle retailed, which decreased retail gross profit by $9.7 million, offset by the 12.9% increase in used retail unit sales, which increased gross profit by $6.3 million.
Finance and insurance revenue increased $6.2 million, or 10.2%, from 2009 to 2010. The increase is due to a $4.7 million, or 7.7%, increase in same store revenues during the period, coupled with a $1.5 million increase from net dealership acquisitions. The same store revenue increase is due to a $60, or 6.6%, increase in comparative average finance and insurance revenue per unit which increased revenue by $4.0 million, coupled with a 1.0% increase in total retail unit sales, which increased revenue by $0.7 million.
Distribution units wholesaled during the quarter decreased 2,236 units, or 65.7%, from 3,401 in 2009 to 1,165 in 2010. During the three months ended September 30, 2010, smart USA recorded $1.4 million of incentives which decreased gross profit. Distribution segment revenue decreased $25.4 million, or 56.6%, to $19.5 million in 2010 due largely to the reduction in wholesale unit sales. As a result, segment gross profit decreased $5.4 million, or 88.5%, to $0.7 million in 2010. During 2010, the distribution segment recorded $1.6 million in pre-production costs related to its efforts to procure a vehicle from Nissan for distribution through smart USA. In total, the distribution segment generated a loss of $6.1 million in 2010 compared with a loss of $5.9 million in 2009.
During the three months ended September 30, 2010, we repurchased $43.0 million principal amount of our Convertible Notes, which had a book value, net of debt discount, of $41.6 million for $43.3 million. We allocated $2.5 million of the total consideration to the reacquisition of the equity component of the Convertible Notes. In connection with the transactions, we wrote off $0.2 million of unamortized deferred financing costs. As a result, we recorded $0.6 million of pre-tax gain in connection with the repurchase.
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