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Mar 26, 2020 1:59 AM ET

Group 1 Automotive Provides Business Update

iCrowd Newswire - Mar 26, 2020

HOUSTON,– Group 1 Automotive, Inc. (NYSE: GPI), an international, Fortune 500 automotive retailer, today reported that due to the unprecedented business impact of the COVID-19 virus, Group 1 is implementing a variety of actions to address the sudden reduction in sales and service volume.

“The sudden impact of this medical and human emergency is clearly disrupting most businesses,” said Earl J. Hesterberg, Group 1’s president and chief executive officer. “This is requiring us to take many severe and regrettable actions to re-size our business to minimal activity levels in the near term.  I believe that the swift and decisive actions that we are taking will enable us to recover quickly when the market recovers as it undoubtedly will.”

The COVID-19 virus is impacting business levels in all three of Group 1’s markets – U.S., U.K., and Brazil – with many dealership operations closed or severely reduced in each of these markets.  The latest situation in each region is as follows:

Due to the sudden dramatic decrease in business activities and the uncertain duration of this decline, Group 1 is taking a variety of actions to preserve the financial strength and flexibility of the Company during this difficult time, which includes:

As previously announced, the Company is proceeding with redeeming the entirety of its 5.25% Senior Notes due 2023 for the face value of $300 million, plus a $7.9 million call premium and accrued interest.  This redemption is being funded by acquisition line borrowing, cash on hand, and mortgage borrowings.  It is anticipated that the majority of the redemption will be funded via an estimated $200 million in mortgage borrowings.  The mortgages are expected to close during the second quarter 2020, with the majority anticipated to close in the next two weeks.  This transaction will extend debt maturities from 2023 to 2027 and lower annual interest expense by approximately $8.5 million.

Group 1 owns and operates 186 automotive dealerships, 242 franchises, and 49 collision centers in the United States, the United Kingdom and Brazil that offer 31 brands of automobiles. Through its dealerships, the Company sells new and used cars and light trucks; arranges related vehicle financing; sells service contracts; provides automotive maintenance and repair services; and sells vehicle parts.

Contact Information:

Group 1 Automotive, Inc.

Tags:    Profitwire, Wire, United States, English