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Market Blog Sonic Automotive cuts outlook as car market drops
Market Blog Sonic Automotive cuts outlook as car market drops
Todays is : Monday, 06 February 2012
| Sonic Automotive cuts outlook as car market drops |
| Written by Stockalyzer |
| Tuesday, 15 July 2008 20:46 |
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Sonic Automotive Inc, the No. 3 U.S. auto retailer, warned on Monday that its full-year earnings would be lower than previously expected due to significant declines in the new and used vehicle market. Sonic, whose shares fell more than 12 percent in after-market trade, said the sales rate has trended significantly lower from what it expected when it set the original forecast, and markets are expected to remain difficult the rest of the year. Automakers and dealers have seen U.S. light vehicle sales drop for a third consecutive year amid a weak economy, and consumer demand has shifted toward smaller vehicles and away from pickup trucks and SUVs due to soaring gas prices. Sonic originally had expected U.S. sales at a 15.5 million annual rate in 2008. However, sales have trended far below that rate in recent months and analysts and automakers have cut their full-year estimates to about the 15 million range. In June, for example, light vehicle sales dropped to a 13.6 million unit seasonally adjusted annual rate from 15.7 million a year earlier, the weakest result in 15 years. Sonic Automotive Inc.'s first-quarter net income fell 29% to $14.2 million, or 35 cents a share, from $20 million, or 44 cents a share, a year earlier. Earnings from continuing operations were 44 cents a share, down from 49 cents a share in the year-ago period. The Charlotte car dealership operator's revenue increased 1% to $1.9 billion from $1.88 billion. On average, analysts polled by Thomson Reuters expected earnings of 49 cents a share on revenue of $1.94 billion. First-quarter same-store sales were down 4%. The company also backed its 2008 non-GAAP earnings projection of $2.35 to $2.50 a share. Sonic shares fell to their lowest level in more than seven years on Monday and 18.54% more on Tuesday to $8.39. |