Lithia & Driveway Posts Strong Q1 Growth in Revenue and EPS
Lithia & Driveway Reports Record First Quarter Performance
Dividend Increase Announced
Lithia & Driveway (NYSE: LAD) has unveiled exceptional results for the first quarter, achieving impressive revenue growth and substantial increases in earnings per share (EPS) compared to the previous year. With record revenue of $9.2 billion for Q1, the company has entered an exciting phase of growth.
This $9.2 billion revenue marks a 7% uptick from the $8.6 billion reported in the same timeframe last year. This surge in performance showcases Lithia & Driveway's resilience and adaptability in a competitive market.
In terms of earnings per share, the reported diluted EPS for the first quarter stood at $7.94, reflecting a remarkable 35% increase from the previous year’s $5.89. The adjusted diluted earnings per share also saw a 25% rise, reaching $7.66 compared to $6.11 in the same quarter of the last year. Notably, unrealized losses on investments in Pinewood Technologies Group PLC contributed a $0.27 deduction to the diluted EPS.
The net income for Q1 reached $211 million, an increase of 28% from the $165 million reported a year prior. Adjusted net income climbed to $204 million, showcasing a 20% growth from the previous year's $171 million.
Key Highlights
- Total revenues increased 7% compared to Q1 2024.
- New retail units grew by 3.6% on a same-store basis.
- Used retail unit growth improved significantly, moving from -4.3% to -0.4%.
- Aftersales gross profit rose by 7.5% year-over-year.
- Driveway Finance Corporation (DFC) originated $623 million in loans, managing an average $4.1 billion in receivables, with a net interest margin of 4.6%.
- 1.7% of outstanding shares have been repurchased.
President and CEO Bryan DeBoer expressed enthusiasm about the strong performance, stating, "Our first quarter results are a testament to the robust and integrated ecosystem we have established at Lithia & Driveway. Our strategic approach and operational efficiencies have enabled us to capture greater market share across our diverse business landscape, helping us provide high-quality experiences to our customers throughout 2025 and beyond."
Corporate Expansion Efforts
In January, Lithia & Driveway took a significant step in expanding its footprint by acquiring the Stohlman Subaru store, an acquisition projected to contribute approximately $80 million in annual revenue. Following this, in March, the company strengthened its presence in the Southwest area by acquiring Elk Grove Subaru, bringing another anticipated $100 million in annual revenue.
To date, Lithia & Driveway has successfully acquired approximately $180 million in expected annual revenues through these strategic acquisitions.
Financial Position and Strategy
At the end of the first quarter, Lithia & Driveway reported a strong balance sheet with around $1.4 billion in cash and cash equivalents, alongside marketable securities and available credit on revolving lines. Additional liquidity of approximately $0.1 billion could be accessed through unfinanced real estate assets.
As part of its commitment to returning value to shareholders, the Board of Directors has authorized a 4% increase in the quarterly dividend to $0.55 per share, which will be paid to shareholders on record by May 9.
Additionally, in the first quarter, Lithia & Driveway repurchased approximately 403,000 shares at an average price of $326, and has so far in 2025 repurchased a total of 470,000 shares at an average price of $319, with $669.2 million remaining under the current share buyback authorization.
Future Outlook and Opportunities
As the automotive sector continues to evolve, Lithia & Driveway is positioned to capitalize on emerging opportunities. The company's diversified business model and strategic initiatives aim to meet the changing demands of consumers. The focus on delivering exceptional customer experiences across various channels will be instrumental in driving growth and profitability in the future.
About Lithia & Driveway
Lithia & Driveway (NYSE: LAD) stands as the world's largest automotive retailer, offering a comprehensive selection of products and services designed to facilitate the entire vehicle ownership process. Through a vast network of physical locations, e-commerce platforms, and finance solutions, the company aims to redefine personal transportation for the modern consumer.
The organization prides itself on consistent and profitable growth in a highly fragmented industry, with a structure built for flexibility and scalability.
Frequently Asked Questions
What were Lithia & Driveway's Q1 revenue figures?
Lithia & Driveway reported Q1 revenue of $9.2 billion, an increase of 7% from the previous year.
How much did the diluted earnings per share increase?
The diluted earnings per share increased by 35%, reaching $7.94.
What initiatives did Lithia & Driveway undertake for expansion?
The company acquired the Stohlman Subaru store and Elk Grove Subaru, with expected annual revenues of $80 million and $100 million respectively.
What is the company's current dividend per share?
The quarterly dividend has been increased to $0.55 per share, reflecting a 4% increase.
How much cash and cash equivalents does Lithia & Driveway have?
The company ended the first quarter with approximately $1.4 billion in cash and equivalents.
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