Penske Automotive Group, Inc. (NYSE:PAG) Q1 2023 Earnings Conference Call April 26, 2023 2:00 PM ET

Company Participants

Anthony Pordon - Investor Relations

Roger Penske - Chairman and Chief Executive Officer

Shelley Hulgrave - Executive Vice President and Chief Financial Officer

Tony Facione - Vice President and Corporate Controller

Conference Call Participants

John Murphy - Bank of America

Daniel Imbro - Stephens

Mike Ward - Benchmark

Rajat Gupta - JPMorgan

David Whiston - Morningstar

Operator

Good afternoon and welcome to the Penske Automotive Group First Quarter 2023 Earnings Conference Call. Today’s call is being recorded and will be available for replay approximately 1 hour after completion through May 3, 2023 on the company’s website under the Investors tab at www.penskeautomotive.com. I would now like to introduce Anthony Pordon, the company’s Executive Vice President of Investor Relations and Corporate Development. Sir, please go ahead.

Anthony Pordon

Thank you, Lois. Good afternoon, everyone and thank you for joining us today. A press release detailing Penske Automotive Group’s first quarter 2023 financial results was issued this morning and is posted on our website, along with a presentation designed to assist you in understanding the company’s results. As always, I am available by e-mail or phone for any follow-up questions you may have.

Joining me for today’s call are Roger Penske, our Chair and CEO; Shelley Hulgrave, our EVP and Chief Financial Officer; and Tony Facione, our Vice President and Corporate Controller.

Our discussion today may include forward-looking statements about our operations, earnings potential, outlook, future events, growth plans, liquidity and assessment of business conditions. We may also discuss certain non-GAAP financial measures, such as earnings before interest, taxes, depreciation and amortization or more commonly referred to as EBITDA, our leverage ratio, free cash flow and cash flow yield.

We have prominently presented the comparable GAAP measures and have reconciled the non-GAAP measures in this morning’s press release and investor presentation, which are available on our website to the most directly comparable GAAP measures. Our future results may vary from our expectations because of risks and uncertainties outlined in today’s press release under forward-looking statements.

I direct you to our SEC filings, including our Form 10-K and previously filed Form 10-Qs for additional discussion and factors that could cause future events to differ materially from expectations. At this time, I will now turn the call over to Roger Penske.

Roger Penske

Thank you, Tony. Good afternoon, everyone, and thank you for joining us today. I’m pleased to report a strong first quarter as our performance continues to demonstrate the benefits of the company’s diversification. During the first quarter, total units delivered increased 8% to 122,431 units. Our revenue increased 5% to $7.3 billion and our SG as a percentage of gross profit was 67.5% and declined 140 basis points sequentially.