Sonic Automotive Inc.'s third-quarter profit more than doubled as the retailer was aided by higher overall and new-vehicle gross profits in its franchised segment, record EchoPark used-vehicle volume and lower expenses, all despite a drop in new-vehicle sales.
Revenue for the nation's sixth-largest new-vehicle retailer fell 5.7 percent to $2.5 billion. Net income more than doubled to $59.8 million.
Net income from continuing operations of $60 million also more than doubled from a year earlier. Results include a $2.3 million after-tax benefit related to franchise disposals.
Sonic's earnings per diluted share from continuing operations of $1.35 in the third quarter was an all-time record, the company said.
"Our third-quarter results demonstrate the strength and resilience of our business model, driving the highest third-quarter profit in our company's history," Sonic President Jeff Dyke said in a statement Thursday. "All business lines saw sequential improvement from the second quarter."
Sonic's EchoPark standalone used-vehicle stores eked out net income of $239,000. The unit set a quarterly revenue record of $385.1 million, up 23 percent from the same period in 2019, as retail sales of 15,127 vehicles also set a quarterly record. Unit sales were up 15 percent.
Earlier this month, Sonic opened its 13th EchoPark location in Nashville. Sonic said it expects to open EchoPark locations by year's end in Plano, Texas, and Atlanta.
Shares of Sonic closed Thursday's trading down a fraction to $36.74.
Records: Third-quarter earnings per diluted share from continuing operations; EchoPark quarterly revenue and EchoPark quarterly sales volume.
Sales: New-vehicle unit sales tumbled 20 percent to 24,100. Used-vehicle unit sales at its franchised stores dropped 9.9 percent to 26,363. Used-vehicle sales when including standalone EchoPark sales dropped 2.3 percent to 41,490.
Same-store sales: New-vehicle unit sales on a same-store basis fell 15 percent to 23,875. That compares with a 9.5 percent drop in U.S. new light-vehicle sales across the industry in the third quarter, according to the Automotive News Data Center. Used-vehicle unit sales on a same-store basis sold through its franchised stores slipped 4.6 percent to 26,216. EchoPark used-vehicle same-store unit sales dipped 2.6 percent to 12,869.
Sonic, of Charlotte, N.C., ranks No. 6 on Automotive News' list of the top 150 dealership groups based in the U.S., retailing 114,131 new vehicles in 2019.