AutoNation Inc. reported a sharp decrease in net income in the first quarter as revenue slipped and the company sold fewer new and used vehicles.
The country's second-largest dealership group reported a 20% drop in first-quarter net income compared to the same quarter a year ago. All in, AutoNation’s net income hit $288.7 million.
Other highlights from AutoNation’s first quarter report:
- Revenue dipped 5% to $6.4 billion.
- New-vehicle retail sales dropped 2.4%.
- Used-vehicle retail sales plummeted 15%.
- Gross profit per used vehicle increased 35% to $2,117.
- Gross profit per new vehicle dropped 15% to $5,210.
- Gross profit increased 11% in its parts-and-service business.
"Our first quarter results demonstrate the resiliency of our operations and the benefits of a diversified business model as our Associates continued to provide an exceptional experience to our large and growing customer base. Our After-Sales team once again delivered double-digit gross profit growth, and we effectively managed our used vehicle business with a deliberate focus on driving gross profit. The strength of our balance sheet and robust cash flow enabled continued funding of investments while also returning significant capital to shareholders," said Mike Manley, AutoNation's Chief Executive Officer.
AutoNation repurchased 2.4 million shares of stock during the first quarter. The auto group’s shares were trading at $131.82, down 3.3%, on Thursday morning when the stock market opened.