• Second quarter net income of $201 million, an increase of 32% over prior year quarter, and adjusted net income (a non-GAAP measure) of $223 million, an increase of 47% over prior year quarter
• Second quarter adjusted EBITDA (a non-GAAP measure) increased 56% over prior year quarter to $352 million, an all-time record
• Second quarter revenue of $4.0 billion, an increase of 53% over prior year quarter, and gross profit of $803 million, an increase of 61% over prior year quarter
• Second quarter same store F&I PVR of $2,409, a 32% increase over prior year quarter
• Second quarter operating margin of 8.5%

DULUTH, Ga.--(BUSINESS WIRE)-- Asbury Automotive Group, Inc. (NYSE: ABG) (the “Company”), one of the largest automotive retail and service companies in the U.S., reported record second quarter 2022 net income of $201 million ($9.07 per diluted share), an increase of 32% from $152 million ($7.80 per diluted share) in the prior year quarter. Second quarter 2022 adjusted net income, a non-GAAP measure, increased 47% year-over-year to $223 million ($10.04 per diluted share) compared to adjusted net income of $152 million ($7.78 per diluted share) in second quarter 2021.

“The Company generated an all-time record adjusted EPS of $10.04 and all-time record adjusted EBITDA of $352 million. With two full quarters with our expanded dealership portfolio, our incredible team across the nation delivered a sequential increase in adjusted EBITDA of 5% and adjusted EPS of 8% over the first quarter of 2022. We are impressed with the strides that our team members are making to integrate our recent acquisitions and deliver value to our shareholders through this organic quarter over quarter growth,” said David Hult, Asbury’s President and Chief Executive Officer.

The financial measures discussed below include both GAAP and adjusted (non-GAAP) financial measures. Please see reconciliations for non-GAAP metrics included in the accompanying financial tables.

Adjusted net income for second quarter 2022 excludes losses, net of tax, of $29 million ($0.97 per diluted share) related to losses on the sale of dealerships and a collision center.

Net income for the second quarter 2021 excluded real estate net gains of $0.5 million ($0.02 per diluted share).

Second Quarter 2022 Operational Summary

Total company vs. 2nd Quarter 2021:

• Revenue of $4.0 billion, an increase of 53%
• Gross profit increased 61%
• Gross margin increased 110 bps to 20.3%
• New vehicle unit volume increased 22%; new vehicle revenue increased 36%; gross profit increased 78%
• Used vehicle retail unit volume increased 48%; used vehicle retail revenue increased 68%; gross profit increased 37%
• Finance and insurance (F&I) per vehicle retailed (PVR) increased 31%
• Parts and service revenue increased 78%; gross profit increased 59%
• SG&A as a percentage of gross profit increased to 55.8%, an increase of 160 bps
• Operating income and adjusted operating income both increased 54%
• Operating margin was flat at 8.5% and adjusted operating margin increased 10 bps to 8.5%
• EPS increased 16% to $9.07; adjusted EPS increased 29% to $10.04

Same store (dealership only) vs. 2nd Quarter 2021:

• Revenue decreased 7%
• Gross profit was flat
• Gross margin increased 140 bps to 20.6%
• New vehicle unit volume decreased 31%; new vehicle revenue decreased 22%; new vehicle gross profit increased 3%
• Used vehicle retail unit volume decreased 2%; used vehicle retail revenue increased 12%; used vehicle retail gross profit decreased 21%; used to new ratio increased to 120% (from 84%)
• F&I PVR increased 32%
• Parts and service revenue increased 10%; gross profit increased 6%; customer pay gross profit increased 16%
• SG&A as a percentage of gross profit increased to 55.9%, an increase of 160 bps

Clicklane metrics:

• Almost 6,600 vehicles sold; an increase of 55% over prior year quarter and 17% sequentially
• 92% of transactions were customers incremental to Asbury Automotive
• 44% of Clicklane sales had a trade-in and 71% of those utilized the payoff tool
• Total front-end PVR of $3,765 and F&I PVR of $2,166, resulting in total front-end yield of $5,927
• Conversion rate nearly double that of traditional internet leads and growing sequentially
• 95% of deliveries within a 50-mile radius of an Asbury dealership
• Average transaction time of ~8 minutes for cash deals and ~14 minutes for financed deals

Liquidity and Leverage

As of June 30, 2022, the Company had cash and floorplan offset accounts of $244 million (which excludes $160 million of cash at TCA) and availability under the used vehicle floorplan line and revolver of $765 million for a total of approximately $1.0 billion in liquidity. The Company’s adjusted net leverage ratio was 2.1x at quarter end compared to 2.7x at the end of 2021.

Earnings Call

Additional commentary regarding the second quarter results will be provided during the earnings conference call on Thursday, July 28, 2022, at 10:00 a.m. ET.

The conference call will be simulcast live on the internet and can be accessed by logging onto www.asburyauto.com/company/investor-relations. A replay will be available on this site for 30 days.

In addition, live audio of the call will be accessible to the public by calling (888) 220-8474 (domestic) or +1 (646) 828-8193 (international); confirmation code – 9867232. Callers should dial in approximately 5 to 10 minutes before the call begins.

A conference call replay will be available two hours following the call for seven days and can be accessed by calling (888) 203-1112 (domestic) or +1 (719) 457-0820 (international); passcode – 9867232.

About Asbury Automotive Group, Inc.

Asbury Automotive Group, Inc. (NYSE: ABG), a Fortune 500 company headquartered in Duluth, GA, is one of the largest automotive retailers in the U.S. In late 2020, Asbury embarked on a five-year plan to increase revenue and profitability strategically through organic and acquisitive growth as well as their innovative Clicklane digital vehicle purchasing platform, with its guest-centric approach as Asbury’s constant North Star. Asbury currently operates 148 new vehicle dealerships in 15 states, consisting of 198 franchises, representing 31 brands of vehicles, and 7 stand-alone used vehicle stores. Asbury also operates 34 collision repair centers, an auto auction, a used vehicle wholesale business and Total Care Auto, Powered by Landcar, a leading provider of service contracts and other vehicle protection products. Asbury offers an extensive range of automotive products and services, including new and used vehicles; parts and service, which includes vehicle repair and maintenance services, replacement parts and collision repair services; and finance and insurance products, including arranging vehicle financing through third parties and aftermarket products, such as extended service contracts, guaranteed asset protection debt cancellation and prepaid maintenance.

For additional information, visit www.asburyauto.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical fact, and may include statements relating to goals, plans, objectives, projections regarding Asbury's financial position, liquidity, results of operations, cash flows, leverage, market position and dealership portfolio, revenue enhancement strategies, operational improvements, projections regarding the expected benefits of Clicklane, management’s plans, projections and objectives for future operations, scale and performance, integration plans and expected synergies from acquisitions, capital allocation strategy, business strategy and expectations of our management with respect to, among other things: changes in general economic and business conditions, including increases in interest rates and rising fuel prices, any impact of COVID-19 on the automotive industry in general, the automotive retail industry in particular and our customers, suppliers, vendors and business partners; our relationships with vehicle manufacturers; our ability to maintain our margins; operating cash flows and availability of capital; capital expenditures; the amount of our indebtedness; the completion of any future acquisitions and divestitures; future return targets; future annual savings; general economic trends, including consumer confidence levels, interest rates, inflation, and fuel prices; and automotive retail industry trends. These statements are based on management's current expectations and beliefs and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, our inability to realize the benefits expected from recently completed transactions; our inability to promptly and effectively integrate completed transactions and the diversion of management’s attention from ongoing business and regular business responsibilities; our inability to complete future acquisitions or divestitures and the risks resulting therefrom; any impact from the COVID-19 pandemic on our industry and business, market factors, Asbury's relationships with, and the financial and operational stability of, vehicle manufacturers and other suppliers, acts of God, acts of war or other incidents and the shortage of semiconductor chips and other components, which may adversely impact supply from vehicle manufacturers and/or present retail sales challenges; risks associated with Asbury's indebtedness and our ability to comply with applicable covenants in our various financing agreements, or to obtain waivers of these covenants as necessary; risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation, including changes in automotive state franchise laws, adverse results in litigation and other proceedings, and Asbury's ability to execute its strategic and operational strategies and initiatives, including its five-year strategic plan, Asbury's ability to leverage gains from its dealership portfolio, Asbury's ability to capitalize on opportunities to repurchase its debt and equity securities or purchase properties that it currently leases, and Asbury's ability to stay within its targeted range for capital expenditures. There can be no guarantees that Asbury's plans for future operations will be successfully implemented or that they will prove to be commercially successful.

These and other risk factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements are and will be discussed in Asbury's filings with the U.S. Securities and Exchange Commission from time to time, including its most recent annual report on Form 10-K and any subsequently filed quarterly reports on Form 10-Q. These forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this press release. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.