Sonic Automotive has revealed record-breaking fourth quarter results in its earnings report, with sizable gains in revenue and profit.
In Q4, the North Carolina dealer group earned $3.59 billion in revenue and $576.1 million in profits, a year-over-year increase of 13% and 9%, respectively. Both numbers broke the company’s previous record. Its used vehicle retailing subsidiary, EchoPark, also recorded all-time high revenues of $589.3 million, a 2% increase from Q4 of 2021. However, due to its $320.4 million pre-tax impairment charges, the company still reported a loss of $190.9 million, decreasing quarterly net income by 14%.
Despite scoring its income decline, its fourth quarter performance still allowed Sonic Automotive’s annual 2022 revenue to climb by 13% to $14 billion. Its $2.3 billion gross profit is the highest in the company’s history, and represents a 21% year-over-year gain. In total, the dealer group made $88.5 million in net income by December.
Sonic Automotive President Jeff Dyke applauded the hard work of the company’s retailers for the brand’s overall success. “Our franchised dealerships team has continued to successfully adapt to an unprecedented automotive retail environment, driving exceptional performance in 2022.”
Last year was a mixed bag for the automotive industry. Success between OEMs and dealership groups in the final months of 2022 varied wildly, with some, like Sonic Automotive, breaking records thanks to a strong Q4 performance, and others, like Ford and Tesla, failing to meet expectations. Out of all automotive sectors, the preowned market likely suffered the most, thanks to a sudden depreciation in used car values. Speaking to CBT News anchor Jim Fitzpatrick, Dyke explained that the atypical success of the company’s used vehicle brand, EchoPark, was the result of careful day supply management. The Sonic Automotive President went on to predict that 2023 would see recoveries to many of the COVID related issues stifling growth in the car business.
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