Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Exact name of Registrant as specified in its charter) Delaware 01-0609375 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-31262 ASBURY AUTOMOTIVE GROUP, INC. (State or ...

Asbury Automotive (ABG) reported first-quarter 2025 adjusted earnings per share of $6.82, which missed the Zacks Consensus Estimate of $6.84 and decreased from $7.21 generated in the year-ago period. Lower-than-expected sales and gross profit from the new and used vehicle business and parts and service business resulted in underperformance. In the reported quarter, revenues amounted to $4.15 billion, which decreased 1.2% year over year and lagged the Zacks Consensus Estimate of $4.4 billion.ABG’s Segment De ...

Financial Performance - First quarter 2025 net income was $132 million ($6.71 per diluted share), a decrease of 10% from $147 million ($7.21 per diluted share) in Q1 2024[2] - Revenue for Q1 2025 was $4.1 billion, a decrease of 1% compared to the same period in 2024[10] - Adjusted net income for Q1 2025 was $134 million ($6.82 per diluted share), down 9% from $147 million ($7.21 per diluted share) in Q1 2024[2] - Gross profit for Q1 2025 was $724 million, a decrease of 3% from the previous year[10] - Total revenue for Q1 2025 was $4,148.5 million, a decrease of 1% compared to $4,201.2 million in Q1 2024[25] - Net income decreased by 10% to $132.1 million, with diluted earnings per share at $6.71, down 7% from $7.21[25] - Adjusted EBITDA for the twelve months ended March 31, 2025, was $963.4 million, down from $982.0 million for the previous year, indicating a decline of 1.7%[39] - The diluted EPS for the three months ended March 31, 2025, was $6.71, compared to $6.82 for the same period in 2024, reflecting a decrease of 1.6%[40] Revenue Breakdown - New vehicle revenue increased by 4% to $2,138.1 million, while total used vehicle revenue decreased by 9% to $1,235.8 million[25] - New vehicle unit volume increased by 2% in Q1 2025, while used vehicle retail unit volume decreased by 10%[10] - The average selling price of new vehicles rose by 2% to $51,525, while the average selling price of used vehicles increased by 1% to $30,465[33] - Total unit sales of new vehicles increased by 2% to 41,496 units compared to 40,677 units in the prior year[33] Expenses and Margins - Operating margin for Q1 2025 was 5.6%, with an adjusted operating margin of 5.8%[10] - Selling, general and administrative expenses decreased by 3% to $456.4 million from $468.6 million year-over-year[33] - The income from operations as a percentage of revenue decreased to 5.6% from 6.3% in the previous year[33] - The gross margin for total new vehicles decreased by 120 basis points to 6.7% from 7.9%[33] - Selling, general and administrative (SG&A) expenses for the three months ended March 31, 2025, were $456.4 million, with SG&A as a percentage of gross profit at 63.0%[40] Liquidity and Debt - As of March 31, 2025, the company had total liquidity of $964 million, including cash and availability under credit lines[9] - Cash and cash equivalents increased by 80% to $124.6 million compared to $69.4 million in Q1 2024[27] - Long-term debt decreased slightly to $3,128.5 million from $3,138.6 million in Q4 2024[27] - The adjusted long-term net debt as of March 31, 2025, was $2,650.7 million, compared to $2,796.9 million as of December 31, 2024, showing a reduction of 5.2%[39] - The transaction adjusted net leverage ratio as of March 31, 2025, was 2.75, slightly down from 2.85 as of December 31, 2024[39] Inventory and Supply Chain - Inventory decreased by 8% to $1,822.4 million from $1,978.8 million in Q1 2024[27] - Days supply of new vehicle inventory improved to 44 days from 49 days in Q4 2024, while used vehicle inventory days supply decreased to 31 days from 37 days[28] Acquisitions and Divestitures - The company completed two divestitures in Q1 2025, contributing estimated annualized revenue of $79 million[2] - The company announced a definitive agreement to acquire The Herb Chambers Automotive Group, which has approximately $3 billion in annual revenue[4] Other Financial Metrics - The company reported a 52% increase in finance and insurance costs, rising to $13.1 million from $8.6 million in Q1 2024[25] - Total non-core items for the twelve months ended March 31, 2025, amounted to $155.4 million, compared to $152.4 million in the previous year[39] - The impact of dealership acquisitions and divestitures on transaction adjusted EBITDA was a negative $1.1 million for the twelve months ended March 31, 2025[39] - Cash provided by operating activities for the three months ended March 31, 2025, was $225.0 million, an increase from $177.1 million in the same period of 2024, representing a growth of 27.0%[40] - Adjusted cash flow provided by operating activities for the three months ended March 31, 2025, was $187.4 million, compared to $208.7 million in the same period of 2024, indicating a decline of 10.6%[40]

Financial Data and Key Metrics Changes - The company generated $4.1 billion in revenue, with a gross profit of $724 million and a gross profit margin of 17.5% [12] - Adjusted operating margin was 5.8%, and adjusted earnings per share (EPS) was $6.82 [12] - Adjusted net income for Q1 2025 was $134 million, excluding certain non-cash items [21] - Adjusted SG&A as a percentage of gross profit was 64% [22] Business Line Data and Key Metrics Changes - Same store revenue for new vehicles was up 6% year over year, with units up 4% [14] - New average gross profit per vehicle was $3,449 [14] - Used vehicle unit volume was down 8% year over year, with used retail gross profit per unit at $15.87 [15] - Parts and service gross profit was up 5% for the quarter, with a gross profit margin of 58.3% [17] Market Data and Key Metrics Changes - Approximately 56% of new vehicle units sold in Q1 were produced in America, insulating them from tariffs [7] - The company experienced a wide range of approaches from OEMs regarding tariff impacts, making predictions challenging [7] Company Strategy and Development Direction - The company is focused on a disciplined growth strategy, highlighted by the pending acquisition of the Herb Chambers Automotive Group [10] - Plans to reduce leverage over the next 18 to 24 months following the acquisition [11] - The implementation of Techeon is expected to improve productivity and guest experience [9] Management's Comments on Operating Environment and Future Outlook - Management noted that the first quarter faced challenges due to weather-related disruptions and tariff uncertainties [42] - The company remains optimistic about long-term growth, particularly in parts and service due to an aging vehicle fleet [19] - Management emphasized the importance of focusing on gross profit rather than volume during uncertain market conditions [42] Other Important Information - The company expects to close the Herb Chambers acquisition by the end of Q2 2025, pending OEM approval [10] - Free cash flow for Q1 2025 was $166 million, with liquidity at $964 million [25] Q&A Session Summary Question: Regarding TCA and tariff impacts - Management indicated that tariffs could slow down deferral impacts, affecting future earnings [30] Question: Integration of Techeon and SG&A savings - The rollout of Techeon is progressing well, with expectations of significant SG&A savings through reduced software costs and improved productivity [32] Question: Gross profit performance compared to peers - Management acknowledged weather impacts and emphasized a focus on maximizing returns rather than chasing volume [42] Question: Impact of tariffs on the Herb Chambers acquisition - The asset purchase agreement does not include a breakup fee for the company, and management sees no reason to walk away from the deal [50] Question: Front end gross outlook - Management believes the company is reaching a floor on front end gross, focusing on profitability rather than volume [56] Question: Parts and service growth outlook - Management maintains a mid-single-digit growth outlook for parts and service, with expectations of increased traffic as weather conditions improve [60] Question: Techeon and revenue opportunities - The integration of Techeon is expected to enhance communication and marketing efficiency, leading to potential revenue growth [66]

A B G | A s b u r y A u t o m o t i v e Investor Relations Presentation 2025 First Quarter Forward-Looking Statements This presentation 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, beliefs, expectations and assumptions, projections regarding Asbury's financial position, liquidity, results of operations, cas ...

For the quarter ended March 2025, Asbury Automotive Group (ABG) reported revenue of $4.15 billion, down 1.3% over the same period last year. EPS came in at $6.82, compared to $7.21 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $4.4 billion, representing a surprise of -5.80%. The company delivered an EPS surprise of -0.29%, with the consensus EPS estimate being $6.84.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wal ...

After suffering as a result of tariff-related woes, investors breathed a sigh of relief on April 22 on signs of easing trade tensions. President Trump and Treasury Secretary Scott Bessent hinted that the 145% tariffs on Chinese goods could be reduced soon. Bessent believes that the current scenario is "unsustainable." Trump is also exploring pauses on certain tariffs, particularly on auto imports and some consumer electronics. The positive developments on the tariff front have resulted in markets being in t ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental ...

Group 1 - Investors in Asbury Automotive Group, Inc. (ABG) should monitor the stock due to significant activity in the options market, particularly the Apr 17, 2025 $200.00 Call which has high implied volatility [1] - Implied volatility indicates the market's expectation of future price movement, suggesting that investors anticipate a significant change in Asbury's stock price, possibly due to an upcoming event [2] - Asbury currently holds a Zacks Rank 3 (Hold) in the Automotive - Retail and Wholesale industry, which is in the top 18% of the Zacks Industry Rank, although the Zacks Consensus Estimate for the current quarter has decreased from $7.07 to $6.67 per share over the last 60 days [3] Group 2 - The high implied volatility surrounding Asbury's stock may indicate a developing trading opportunity, as options traders often seek to sell premium on options with high implied volatility to benefit from time decay [4]

Core Viewpoint - The U.S. is experiencing heightened tariff tensions, particularly affecting major trading partners like Canada, Mexico, and China, leading to retaliatory measures and increased trade volatility [1][2]. Group 1: Market Impact - The trade war is expected to create increased volatility and uncertainty in U.S. equity markets, but investors are encouraged to remain engaged with stocks [2]. - A screening process has been developed to identify stocks with improving broker recommendations and upward revisions in earnings estimates over the past four weeks [3]. Group 2: Screening Criteria - The screening criteria include net upgrades in broker ratings, percentage change in earnings estimates, and price-to-sales ratios, focusing on companies in the bottom 10% of this ratio [4][5]. - Additional criteria include a stock price greater than $5, an average daily volume exceeding 100,000 shares, and a market value ranking in the top 3000 [5]. Group 3: Selected Stocks - Cardinal Health (CAH) is a nationwide drug distributor with an expected earnings growth rate of 5.4% for the current year, and its earnings estimates have improved by 1.5% over the last 60 days [6][7]. - DXC Technology is benefiting from its digital business and partnerships, with a 5.4% increase in earnings estimates over the past 60 days and a strong earnings surprise history [7][8]. - Cross Country Healthcare (CCRN) is experiencing growth in its home care staffing business and has a Zacks Rank of 3, with earnings surpassing estimates in three of the last four quarters [9]. - Avnet (AVT) is capitalizing on the defense and data center markets, with a focus on Internet of Things capabilities and a Zacks Rank of 3 [10][11]. - Asbury Automotive Group (ABG) is leveraging its diversified product mix and e-commerce platform for growth, with a recent increase in earnings estimates [11][12].