Sonic Automotive Inc. (SAH: Quote) Monday reported a better-than-expected increase in second quarter profit, helped by double-digit sales growth as well as an income tax benefit, partly offset by lower gross margin.
The car and light truck retailer reported a 12.3 percent rise in quarterly sales year-over-year.
New vehicle retail revenue increased 21.3 percent from last year and accounted for most of the business. Total new units sold was 36,026, up from 30,276 units in the prior year.
Used vehicle revenue improved 4 percent from a year ago, and parts and service revenue climbed 3.2 percent.
North Carolina-based Sonic Automotive reported second quarter net income of $28 million or $0.47 per share, compared to $21.4 million or $0.35 per share last year.
On average, six analysts polled by Thomson Reuters expected earnings of $0.41 per share for the quarter. Analysts' estimates typically exclude special items.
Results for the 2012 quarter include a tax benefit of $0.06 per share, partly offset by charges of $0.03 per share on its senior notes.
Revenues for the quarter totaled $2.19 billion, compared to $1.95 billion last year. Analysts expected revenues of $2.18 billion for the quarter.
Gross margin for the quarter dropped to 14.7 percent from 15.37 percent a year ago.
Sonic Automotive said its Board approved an additional $100 million under its share repurchase program, following which it currently has about $130 million of authorization to repurchase shares of its Class A common stock.
The company also announced a quarterly dividend of $0.025 per share, payable on October 15 to stockholders of record on September 15.
SAH is trading at $15.99, down 2.80%, on the NYSE.
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by RTT Staff Writer
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