Penske Automotive Group Inc. (PAG) recently announced the acquisition of Crevier BMW and MINI franchises in Santa Ana, California, for an undisclosed price.
The deal was funded partly by operating cashflows and partly by the company’s U.S. revolving credit facility.
Crevier BMW was ranked as the fifth largest new-unit BMW dealer in the U.S. based on unit sales in 2010; whereas, Crevier MINI was ranked as the seventh largest MINI dealer in the nation.
These franchisees span across 12 acres, with nearly 100,000 square feet of facilities, 62 service bays accompanied by a five-story, 195,000-square-foot parking structure. The acquisition will enable Penske to strengthen its existence in Orange County, California, thereby contributing significantly to its revenue from the region.
Penske Automotive, based in Bloomfield Hills, Michigan, was established in 1990 and is the second-leading automotive retailer in the U.S. Following the acquisition of Fred Baker Porsche and Audi franchises in the Cleveland metropolitan area, Penske Automotive operates 172 franchises in 17 states and Puerto Rico, and 154 franchises located internationally, primarily in the U.K., Germany and Mexico. Its key competitors include AutoNation Inc. (AN) and CarMax Inc. (KMX).
During the last reported quarter, Penske reported net income of $36.4 million from continuing operations, up 51.7% from $24 million in the year-ago period. Consequently, earnings per share from continuing operations increased 50.0% to 39 cents per share from 26 cents per share a year ago.
Revenues in the quarter increased 15.3% to $2.86 billion, mostly driven by a 13.9% rise in total retail unit sales and improving trends in the service and parts operations. Same-store retail revenue climbed 11.6% to $2.59 billion.
The growth in same-store revenue emanated from a 14.1% increase in used vehicles and a 12.5% increase in new vehicles. Region wise, same-store retail sales increased 12.7% in the U.S. and 9.8% in the international market.
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