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Sonic Automotive (SAH) Tops Q3 EPS by 25c

October 29, 2020 7:00 AM EDT

Sonic Automotive (NYSE: SAH) reported Q3 EPS of $1.35, $0.25 better than the analyst estimate of $1.10. Revenue for the quarter came in at $2.55 billion versus the consensus estimate of $2.52 billion.

Jeff Dyke, Sonic’s and EchoPark’s President, commented, “Our third quarter results demonstrate the strength and resilience of our business model, driving the highest third quarter profit in our Company’s history. All business lines saw sequential improvement from the second quarter, with a combination of increasing consumer demand and enhanced operating efficiency and profitability as a result of the strategic actions our team took early in the pandemic. We believe the third quarter marks an inflection point in our Company’s path to more than double its total revenues and dramatically increase profitability in the next five years. We remain committed to providing our guests with an industry-leading vehicle purchase experience, offering a variety of options across the omni-channel spectrum to suit each individual’s needs. We continue to enhance our e-commerce platform to offer our guests a fully-integrated online and on-site sales experience at both our franchised dealership websites and EchoPark.com, further supporting the long-term growth plans for our business.”

Mr. Dyke continued, “We are very pleased with our franchised dealerships’ performance during the quarter, which reflects steadily increasing automotive retail consumer demand and the extraordinary dedication of our teammates to continue to deliver exceptional results despite the challenges of the pandemic. As importantly, EchoPark achieved all-time record retail sales volume in the quarter, selling over 15,000 units at our 12 existing locations. Our guests continue to see incredible value in the inventory selection, pricing, and buying experience that EchoPark offers and we remain focused on accelerating the expansion of this brand nationally. Our recent EchoPark expansion in Greenville, South Carolina, Houston, Texas, and Nashville, Tennessee, plus expected new openings by year end in Plano, Texas and Atlanta, Georgia, continue to drive toward a 140-point nationwide distribution network, expected to retail over half a million pre-owned vehicles annually by 2025.”

Heath Byrd, Sonic’s and EchoPark’s Chief Financial Officer, commented, “We have continued to increase operating efficiency at both our franchised dealerships and EchoPark stores, driving improved profitability throughout our operations. Total SG&A expenses for the third quarter were down $39.7 million, or 13.4%, year-over-year, while SG&A expenses as a percentage of gross profit were 68.3%, down 840 basis points from the year-ago quarter. Due to our ongoing cost-management initiatives, we are now a much leaner, more efficient organization than we were prior to the COVID-19 pandemic.”

For earnings history and earnings-related data on Sonic Automotive (SAH) click here.



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