Growth keys profit for Lithia
Lithia Motors reported its fourth-quarter earnings and revenues more than tripled in 1997.
The Medford-based company booked $1.87 million, a 234 percent increase from the $560,000 a year earlier. Sales totaled $113.1 million, compared with $37.3 million for the same period a year earlier. The per-share profit climbed from 11 cents to 25 cents for the quarter.
For the year, the company posted a $6 million profit -- 82 cents a share -- on $319.8 million in sales. That compares with the preceding year's $2.6 million profit (52 cents a share) on sales of $142.8 million.
Growth and improved profit margins account for the results, said Sid DeBoer, chairman and chief executive. The company added 10 dealerships and shifted focus to higher-margin products such as used cars, service and parts, finance and insurance products, he explained.
In 1997, the company sold 7,493 new vehicles, a 148 percent increase from the previous year, and 7,148 retail used cars -- up 72 percent from a year earlier.
The gross margin was 16.7 percent, compared with a national average of 12.9 percent, according to the National Auto Dealers Association.
By clustering valuable franchises within strong regional economies ... we anticipate continued operational improvements, said Dick Heimann, president and chief operating officer. We continue to be reassured by the number of attractive dealerships available for purchase.
Since year's end, Lithia has added four more dealerships, in Fresno, Reno and Medford.