Penske Earnings Jump 38 Percent For Q3

Penske Earnings Jump 38 Percent For Q3

Penske, the second largest automotive retailer in the US put up some staggering numbers in third quarter profits for the current year. Revenue jumped 2.4 percent to over $5 billion with net income increasing 38 percent to just over $130 million, signifying one of their best fiscal quarters in memory. 

Many have credited the record quarter with the enactment of a tax act passed in 2017. This saved the company nearly $12 million, adjusting the tax bracket the company paid by 17.3 percent. 

Roger Penske recently said in an interview:

"The strength of our performance in the third quarter was driven by increases in new vehicle, used vehicle and finance and insurance gross profit per retail unit sold, coupled with a 70 basis-point increase in service and parts gross margin. Further, our U.K. business produced another record quarter on the strength of its premium brand mix and stand-alone used vehicle supercenter operations." 

Even without calculating in the tax adjustments, Penske's businesses nearly pulled profits across the board, with standouts in the areas of used vehicles and finance. The only area to suffer was with new vehicle sales, which were down 8.4 percent over last year. Unfortunately for Penske, the overall earnings didn't translate into the expected investor confidence necessary to bolster stock prices. These fell .3 percent despite the fantastic quarter earnings. 

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Written By: Todd Hendrickson
Source: autonews.com