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DULUTH, Ga. - On Tuesday, Asbury Automotive Group (NYSE:ABG) reported second-quarter earnings that exceeded analyst expectations, with strong profitability offset slightly lower-than-anticipated revenue.
The company’s shares were up 1.75% in pre-market trading following the release.
The automotive retailer posted adjusted earnings of $7.43 per diluted share for the second quarter, significantly beating the analyst estimate of $6.83. Revenue came in at $4.4 billion, slightly below the consensus estimate of $4.45 billion but still representing a 3% increase from the same period last year.
Asbury’s gross profit rose 3% to $752 million, with parts and service achieving an all-time record gross profit of $355 million. The company also reported the fourth consecutive quarter of sequential improvement in same-store used retail gross profit per unit, which increased 11% compared to Q2 2024.
"I commend our team members for their sustained focus on growth, profitability and cost discipline," said David Hult, Asbury’s President and Chief Executive Officer.
The company demonstrated improved operational efficiency with selling, general and administrative expenses as a percentage of gross profit decreasing 198 basis points to 63.2% compared to the prior year. New vehicle unit volume increased 4% while used vehicle retail unit volume decreased 6%.
Asbury completed the acquisition of The Herb Chambers Automotive Group on July 21, adding approximately $3 billion in annual revenue. The company also divested nine stores between April and July as part of its portfolio optimization strategy, generating net proceeds of $250-$270 million.
As of June 30, Asbury had $318 million in cash and floorplan offset accounts, with total liquidity of $1.1 billion. The company’s transaction adjusted net leverage ratio was 2.46x at quarter end.
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