DETROIT -- Lithia Motors Inc. on Tuesday posted a 21 percent increase in third-quarter earnings on strong revenue growth, and the car dealership group raised its full-year profit forecast.
Profit rose to $17.6 million, or 83 cents a share, from $14.5 million, or 70 cents a share, a year earlier.
Excluding the effect of an accounting change, the company said it earned 90 cents a share.
Lithia Motors Inc. ranks No. 8 on the Automotive News list of the top 100 dealership groups in the United States with retail sales of 56,529 new vehicles in 2004.
Wall Street analysts were on average expecting 76 cents a share, according to Reuters Estimates.
"The third quarter can be characterized by same-store sales and same-store gross profit growth across all business lines, cost savings, and margin improvement in the used retail business," Chief Executive Sidney DeBoer said in a statement.
Revenue rose 16 percent to $869.3 million from $751 million, boosted by a 15 percent increase in new vehicle sales and 19 percent growth in finance and insurance revenue.
New vehicle inventories at the end of September were 14 days lower than at the end of the second quarter, the company said.
Lithia raised its full-year earnings outlook to between $2.33 and $2.36 per share from a prior range of $2.29 to $2.34.
The company said it expects to earn between 45 cents and 48 cents a share in the fourth quarter and between $2.37 and $2.47 per share in 2006.
The outlook includes the effect of accounting changes, including one that increases the number of shares outstanding.
Wall Street analysts on average were expecting earnings of 53 cents per share for the fourth quarter, $2.38 for 2005 and $2.58 for 2006, according to Reuters Estimates.