DETROIT -- Car dealership group AutoNation Inc. on Thursday posted a better-than-expected 40 percent rise in earnings, boosted by growth in revenue and improved profitability across all its business lines.
The largest U.S. automotive retailer said third-quarter net income rose to $129.3 million, or 48 cents per share, from $92.4 million, or 34 cents per share, a year earlier.
AutoNation said income from continuing operations was 45 cents a share. Excluding a gain of 4 cents per share from the resolution of tax matters, it earned 41 cents.
On that basis, Wall Street analysts on average expected 39 cents a share, according to Reuters Estimates.
Revenues rose 5 percent to $5.2 billion, driven by increased sales of new and used vehicles, parts and service, and finance and insurance products, the company said.
On a same-store basis, sales rose 4.4 percent.
AutoNation Chairman Mike Jackson told Reuters in an interview that the third quarter results were the best in company's history.
"In addition to operational improvements in nearly every area of the business -- new and used vehicles, parts and service, finance and insurance -- we benefited during this time from the employee discount programs launched by the Detroit 3," Jackson said.
The third quarter was marked by big employee discounts from U.S. automakers, which helped reduce swollen inventories of unsold new vehicles at many dealerships.
"We had our inventories in line for the entire quarter and therefore did not have to liquidate a lot of bad, unprofitable inventory," Jackson said.
At the end of the third quarter, AutoNation's new vehicle inventory was at 43 days supply versus 53 days at the end of the third-quarter 2004, which represents a 22 percent decline, the company said.
AutoNation said while hurricanes did not have a significant impact in the third quarter, it is still in the process of assessing damage from Hurricane Wilma.
Hurricane Wilma disrupted its South Florida operations, where it has 33 dealerships representing about 20 percent of its business.
AutoNation, which does not give quarterly or full-year estimates, expects the disruption to be a short-term one, COO Mike Maroone told Reuters.