DETROIT (AP) — AutoNation Inc., the country's largest auto dealership chain, said Thursday that its third-quarter net income rose more than 15 percent as it benefited from the continued rebound in U.S. new-car sales.
The Fort Lauderdale, Fla., company said it earned $81.6 million, or 66 cents per share, in the quarter ended Sept. 30. That compared with 70.7 million, or 48 cents per share, last year.
The outsized jump in earnings per share reflects a 14 percent drop in the number outstanding shares since the 2011 third quarter
Revenue rose 12 percent to $3.9 billion.
The results matched Wall Street's expectations. Analysts, on average, expected earnings of 66 cents per share, on revenue of $3.9 billion, according to FactSet.
Auto dealership chains are making strong profits this year despite a sputtering economy, as U.S. new-vehicle sales continue to bounce back from the Great Recession. Sales so far this year are running at annual rate of 14.3 million, 1.5 million more than last year's sales of 12.8 million. Many analysts say that people who kept their cars and trucks through the recession are now being forced to replace them. The average age of a U.S. vehicle is close to 11 years.
At AutoNation, the chain also posted strong revenue gains on used cars, as well as parts and service and finance and insurance.
"We continued to see a strong new vehicle selling environment in the third quarter," CEO Mike Jackson said in a statement. The 261-dealership chain saw new-vehicle sales rise during the quarter, with sales up 21 percent from a year ago.
Sales from Detroit-based manufacturers were up 9 percent, sales from foreign-based automakers up 35 percent and premium luxury sales rising 11 percent.
New car and truck sales ran at an annual rate of 14.5 million for the quarter, and AutoNation expects the U.S. will end the year at that number. That's 13.3 percent higher than last year, which is a bonanza for new-car dealers.
AutoNation shares closed Wednesday trading at $48.04, up 30 percent since the start of the year.