Penske Automotive expects Q2 profit as business improves

Penske Automotive Group said its U.S. vehicle sales improved from May to June and the nation’s second-largest new-vehicle retailer expects to post a profit when second-quarter results are planned for release July 29.

The retailer said Tuesday that it expects second-quarter earnings per share from continuing operations to range from 52 cents to 57 cents. The company, whose business was hampered early in the quarter amid the coronavirus pandemic, said improved June franchise business in the U.S. and the United Kingdom, expense management and robust sales upon reopening used-vehicle supercenters last month aided results.

“I am encouraged by the significant improvement in our operations during the month of June,” Penske CEO Roger Penske said in a statement. “Our performance in June is the result of a strong operational focus to control costs, manage vehicle inventory and maximize gross profit.”

Penske said it plans to repay $300 million in senior debt notes that mature Aug. 15 with available credit. The company ended the second quarter with nearly $1.2 billion in cash and credit.

Penske, of Bloomfield Hills, Mich., ranks No. 2 on Automotive News‘ list of the top 150 dealership groups based in the U.S., retailing 222,800 new vehicles in 2019. It retailed 284,200 used vehicles for the same period, ranking it No. 2 on Automotive News‘ list of the top 100 dealership groups in used-vehicle sales.

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