GSA Daily Staff Report
Published June 23, 2010
CarMax Inc., with locations in Greenville, Columbia and Charleston, today reported net sales and operating revenues increased 23% to $2.26 billion for the first quarter compared to $1.83 billion in the same quarter last year.
Net earnings increased 252% to $101.1 million compared to the same quarter in 2009.
"We are pleased to report another quarter of healthy increases in both used and wholesale vehicle unit sales," said Tom Folliard, president and CEO. “Our 9% increase in comparable store used unit sales reflected the benefit of a continuing gradual rebound in customer traffic, as well as the easy year-over-year comparison. Sales execution remained strong, as our stores were able to maintain the recent gains in the sales conversion rate.”
Wholesale unit sales increased 52%. The improvement reflected significant increases in both appraisal traffic and the company’s appraisal buy rate, Folliard said, as well as the easy comparison with the prior year period.
“Our buy rate has steadily strengthened over the last several quarters to slightly over 30% in the first quarter of this year,” he said “We believe this reflected favorable consumer response to our higher appraisal offers, which largely resulted from the strength of wholesale industry used vehicle pricing.”
Other sales and revenues declined 4% versus those reported in the first quarter of last year. Extended service plan revenues increased 20%. However, this increase was more than offset by the decline in net third-party finance fees, Folliard said.
“The change in third-party finance fees primarily reflected a mix shift among providers, including a significant increase in the percentage of vehicle sales financed by our subprime finance provider,” he added.
Total gross profit increased 21% to $333.5 million from $276.2 million in the first quarter of last year. Used vehicle gross profit per unit increased to $2,212 per unit from $2,001 per unit in the prior year quarter. Wholesale vehicle gross profit per unit also increased to $942 per unit from $904 per unit in the first quarter last year.
