Q4 2024 Asbury Automotive Group Inc Earnings Call Transcript
Key Points
- Asbury Automotive Group Inc (ABG) reported a record $4.5 billion in revenue for the fourth quarter, marking an 18% year-over-year increase.
- The company achieved a gross profit of $750 million, up 11% from the previous year, with a gross profit margin of 16.6%.
- Same-store new vehicle volume increased by 7% year-over-year, with a 12% sequential increase, and gross profit per new vehicle rose by $149 compared to the third quarter of 2024.
- The parts and service business delivered outstanding results, with same-store gross profit up 11% and customer pay segment up 13%.
- The company successfully reduced SG&A costs as a percentage of gross profit to 63% on an adjusted basis, marking the second consecutive quarter of improvement.
- Inventory challenges are expected to persist throughout 2025, particularly affecting the used vehicle market.
- Stellantis brand performance was a significant headwind, with gross per unit down substantially year-over-year.
- The rollout of Total Care Auto (TCA) in Florida and Koons is anticipated to be a headwind to earnings, with a projected noncash deferral hit of $62 million or $2.35 per diluted share in 2025.
- The company faces potential headwinds from rising new vehicle incentives, which could impact used vehicle pricing.
- Weather-related disruptions in January affected sales, with multiple store closures impacting performance.
Greetings and welcome to Asbury Automotive Group fourth-quarter 2024 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded.
I would now like to turn the conference over to your host, Mr Chris Reeves, Vice President of Finance and Treasurer. Thank you. You may begin.
Thanks, operator, and good morning. As noted, today's call is being recorded and will be available for replay later this afternoon. Welcome to Asbury Automotive Group's fourth quarter 2024 earnings call. The press release detailing Asbury's fourth quarter results was issued earlier this morning and is posted on our website at investors.asburyauto.com.
Participating with me today are David Hult, our President and Chief Executive Officer; Dan Clara, our Senior Vice President of Operations; and Michael Welch, our Senior Vice President and Chief Financial Officer. At the conclusion of our remarks, we will open up the call for questions and will be available
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