CarMax, Inc. (KMX) Wednesday reported a 13 percent increase in fourth-quarter profit, helped by increased revenue from sales of used cars. Both earnings and revenues topped estimates.
Net earnings for the quarter climbed to $107.22 million or $0.46 per share from $95.03 million or $0.41 per share in the prior-year quarter. On average, 15 analysts polled by Thomson Reuters expected earnings per share of $0.46 for the quarter. Analysts' estimates typically exclude one-time items.
Net sales and operating revenues increased 14 percent to $2.83 billion from last year's $2.48 billion, surpassing consensus estimates of $2.73 billion.
Used vehicle sales climbed 16.4 percent to $2.3 billion and Wholesale vehicle sales advanced 7.9 percent to $427.1 million.
During the quarter, used unit sales in comparable stores rose 6 percent and total used unit sales advanced 12 percent, in spite of one fewer day in this year's quarter.
Total wholesale unit sales increased 7 percent in the fourth quarter, benefiting from growth in store base, modest increases in appraisal traffic and appraisal buy rate. CAF income increased 15 percent to $76.0 million.
The comparable store used unit growth was driven by improved conversion, amid more compelling credit offers from CarMax Auto Finance or CAF, increased inventory selection and continued strong in-store execution.
Tom Folliard, president and CEO, said, ''We are pleased to report solid increases in used and wholesale vehicle unit sales and CAF income, which allowed us to achieve record earnings for both the fourth quarter and the fiscal year."
KMX closed at $41.68 on Tuesday.
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