Publicly held dealership groups reported a mixed bag of first-quarter results.
United Auto Group, based in New York, reported that net income was off about 30 percent, to $2.3 million, despite an 80 percent growth in revenue, to $710.2 million. That net income figure does not include a one-time charge of $1.2 million, related to refinancing one of the company's main credit lines. Including the one-time charge, net income was off about two-thirds, from the year-ago quarter.
The $1.2 million was a 'non-cash' charge for accounting purposes and does not represent money out of the company's pocket, said Marshall Cogan, chairman and CEO.
Cogan called the first-quarter results a big improvement over the fourth quarter of 1997, 'in virtually every category.' United Auto took a $31.7 million charge in the fourth quarter when it dropped some unprofitable franchises.
Compared to the year-ago quarter, Cogan said nearly all the dealerships that the group has owned for at least a year had higher operating profits. The chain today has about 90 dealerships, twice as many as a year ago. Cogan said United Auto expects to pass 100 dealerships by the third quarter of this year.
Cross-Continent: An $815,000 charge for employee severance pay reduced first-quarter earnings for Cross-Continent Auto Retailers Inc. to $1.5 million, down from $2.1 million in the first quarter of 1997.
First-quarter revenue rose to $149.5 million, from $60.5 million in the first quarter of 1997. Cross-Continent is a publicly held dealership group based in Amarillo, Texas.
Lithia Motors Inc., a publicly held dealership group based in Medford, Ore., said revenue was $146.2 million in the first quarter, up from $54.7 million a year ago.
Net earnings were $1.52 million, up 33 percent from a year earlier.
Group 1 Automotive Inc. of Hous-ton posted a 33 percent gain in net income for first quarter 1998.
Net income rose to $3.114 million, up from $2.337 million in the first quarter of 1997.
First-quarter revenue increased 18 percent, to $253 million, from $215 million in first quarter 1997.