Group 1 Automotive Q4 2025 Group 1 Automotive Inc Earnings Call | AllMind AI Earnings | AllMind AI
Q4 2025 Group 1 Automotive Inc Earnings Call
Speaker #1: Good morning, ladies and gentlemen. Welcome.
Operator: Good morning, ladies and gentlemen. Welcome to Group 1 Automotive's Q4 and full year 2025 financial results conference call. Please be advised that this call is being recorded. I would now like to turn the call over to Mr. Pete DeLongchamps, Group 1's Senior Vice President, Manufacturer Relations and Financial Services. Please go ahead, Mr. DeLongchamps.
Operator: Good morning, ladies and gentlemen. Welcome to Group 1 Automotive's Q4 and full year 2025 financial results conference call. Please be advised that this call is being recorded. I would now like to turn the call over to Mr. Pete DeLongchamps, Group 1's Senior Vice President, Manufacturer Relations and Financial Services. Please go ahead, Mr. DeLongchamps.
Speaker #1: fourth-quarter and full-year to Group 1 Automotive's 2025 financial results conference call. Please be advised that this call is being recorded. I would now like to turn the call over to Mr. Peter DeLongchamps, Group 1's Senior Vice President, Manufacturer Relations and Financial Services.
Speaker #1: DeLongchamps. Please go ahead, Mr.
Pete DeLongchamps: Thank you, Nick, and good morning, everyone, and welcome to today's call. The earnings release we issued this morning and a related slide presentation that include reconciliations related to the adjusted results we will refer to on this call for comparison purposes have been posted at Group 1's website. Before we begin, I'd like to make some brief remarks about forward-looking statements and the use of non-GAAP financial measures. Except for historical information mentioned during the conference call, statements made by management of Group 1 are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve both known and unknown risks and uncertainties, which may cause the company's actual results in future periods to differ materially from forecasted results.
Pete DeLongchamps: Thank you, Nick, and good morning, everyone, and welcome to today's call. The earnings release we issued this morning and a related slide presentation that include reconciliations related to the adjusted results we will refer to on this call for comparison purposes have been posted at Group 1's website. Before we begin, I'd like to make some brief remarks about forward-looking statements and the use of non-GAAP financial measures. Except for historical information mentioned during the conference call, statements made by management of Group 1 are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve both known and unknown risks and uncertainties, which may cause the company's actual results in future periods to differ materially from forecasted results.
Speaker #2: everyone, and welcome to today's Thank you, Nick. And good morning, call. The earnings release we issued this morning include reconciliations and a related slide presentation that related to the adjusted results we will refer to on this call for comparison purposes have been posted at Group we begin, I'd like to make some brief remarks 1's website.
Speaker #2: about forward-looking statements and the use of Before non-GAAP financial measures. Except for historical information mentioned during management of Group 1 are forward-looking statements the conference call, statements made by and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.
Speaker #2: statements involve both known and unknown risks and uncertainties, which may cause the Forward-looking company's actual results and future periods to differ materially from forecasted results.
Speaker #2: Those risks include but are not limited to risks associated with pricing, volume, inventory supply, conditions of markets, successful integration of acquisitions, and adverse developments in the global economy and resulting impacts on demand for new and used vehicles and related services.
Pete DeLongchamps: Those risks include, but are not limited to, risks associated with pricing, volume, inventory supply, conditions of markets, successful integration of acquisitions, and adverse developments in the global economy, and resulting impacts on demand for new and used vehicles and related services. Those and other risks are described in the company's filings with the Securities and Exchange Commission. In addition, certain non-GAAP financial measures, as defined under SEC rules, may be discussed on this call. As required by applicable SEC rules, the company provides reconciliations of any such non-GAAP financial measures to the most directly comparable GAAP measures on its website. Participating with me on today's call, Daryl Kenningham, our President and Chief Executive Officer, and Daniel McHenry, Senior Vice President and Chief Financial Officer. I'd now like to hand the call over to Daryl.
Those risks include, but are not limited to, risks associated with pricing, volume, inventory supply, conditions of markets, successful integration of acquisitions, and adverse developments in the global economy, and resulting impacts on demand for new and used vehicles and related services. Those and other risks are described in the company's filings with the Securities and Exchange Commission. In addition, certain non-GAAP financial measures, as defined under SEC rules, may be discussed on this call. As required by applicable SEC rules, the company provides reconciliations of any such non-GAAP financial measures to the most directly comparable GAAP measures on its website. Participating with me on today's call, Daryl Kenningham, our President and Chief Executive Officer, and Daniel McHenry, Senior Vice President and Chief Financial Officer. I'd now like to hand the call over to Daryl.
Speaker #2: and other risks are described in the company's findings Those with the Securities and Exchange Commission. In addition, certain non-GAAP financial measures, as defined under SEC rules, may be discussed on this call.
Speaker #2: As required by applicable SEC rules, the company provides reconciliations of any such non-GAAP financial measures to the most directly comparable GAAP measures on its website.
Speaker #2: Participating with me on today's call, Daryl Kenningham, our President and Chief Executive Officer, and Daniel McHenry, Senior Vice President and Chief Financial Officer. I'd now like to hand the call over to Daryl.
Speaker #2: Participating with me on today's call are Daryl Kenningham, our President and Chief Executive Officer, and Daniel McHenry, Senior Vice President and Chief Financial Officer. I'd now like to hand the call over to
Speaker #3: Thank you, Pete, and good morning, everyone. In 2025, Group 1 achieved record revenues across all major business lines and record gross profits in parts and service and F&I.
Daryl Kenningham: Thank you, Pete, and good morning, everyone. In 2025, Group 1 achieved record revenues across all major business lines and record gross profits in parts and service, and F&I, underscoring the strength and resilience of our diversified business model and our relentless focus on operational excellence. During the quarter, we delivered impressive parts and service results and strong F&I performance in both the US and the UK. Parts and service continues to be a differentiator for Group 1, providing both growth and stability while we leverage our scale and execution flexibility to further build out our used vehicle business.
Daryl Kenningham: Thank you, Pete, and good morning, everyone. In 2025, Group 1 achieved record revenues across all major business lines and record gross profits in parts and service, and F&I, underscoring the strength and resilience of our diversified business model and our relentless focus on operational excellence. During the quarter, we delivered impressive parts and service results and strong F&I performance in both the US and the UK. Parts and service continues to be a differentiator for Group 1, providing both growth and stability while we leverage our scale and execution flexibility to further build out our used vehicle business.
Speaker #3: Underscoring the strength and resilience of our diversified business model and our relentless focus on operational excellence. During the quarter, we delivered impressive parts and service results and strong F&I performance in both the US and the UK.
Speaker #3: a differentiator for Group 1. Providing both growth and Parts and service continues to be stability, while we leverage our scale and execution flexibility, to further build out our used vehicle business.
Speaker #3: Our F&I teams have done an outstanding job maintaining gross profit discipline, while driving higher product penetrations across nearly all categories. For the high gross profit of more than full year, we generated an all-time $3.6 billion.
Daryl Kenningham: Our F&I teams have done an outstanding job maintaining gross profit discipline while driving higher product penetrations across nearly all categories. For the full year, we generated an all-time high gross profit of more than $3.6 billion, including record parts and service gross profit of nearly $1.6 billion. We sold 459,000 new and used vehicles in 2025, another record. In the US, new vehicle PRUs moderated by just $62 sequentially, reflecting a slower pace of normalization. Throughout the year, we remained focused on deploying capital toward the highest and best use for our shareholders. 2025 was a great example of that strategy. In the US, we acquired outstanding brands in growth markets, Lexus and Acura, Fort Myers, Florida, and Mercedes-Benz dealerships in Austin, Texas, and Atlanta, Georgia.
Daryl Kenningham: Our F&I teams have done an outstanding job maintaining gross profit discipline while driving higher product penetrations across nearly all categories. For the full year, we generated an all-time high gross profit of more than $3.6 billion, including record parts and service gross profit of nearly $1.6 billion. We sold 459,000 new and used vehicles in 2025, another record. In the US, new vehicle PRUs moderated by just $62 sequentially, reflecting a slower pace of normalization. Throughout the year, we remained focused on deploying capital toward the highest and best use for our shareholders. 2025 was a great example of that strategy. In the US, we acquired outstanding brands in growth markets, Lexus and Acura, Fort Myers, Florida, and Mercedes-Benz dealerships in Austin, Texas, and Atlanta, Georgia.
Speaker #3: profit of nearly $1.6 Including record parts and service gross billion. We sold 459,000 new and used vehicles in 2025, another PRUs moderated by just record.
Speaker #3: 62 dollars sequentially. In the US, new vehicle Reflecting a slower pace of year, we remained focused on normalization. Throughout the deploying capital toward the highest and best use for our shareholders.
Speaker #3: example of that strategy. In the US, we acquired 2025 was a great outstanding brands in growth markets. Lexus and Acura of Fort Myers, Florida, and Mercedes-Benz dealerships in Austin, Texas, and Atlanta, Georgia.
Speaker #3: In the UK, we acquired three Toyota and one Lexus dealership. We expect these acquisitions to generate approximately $640 million in annual revenue. At the same time, we disposed of 13 dealerships comprising 32 franchises.
Daryl Kenningham: In the UK, we acquired three Toyota and one Lexus dealership. We expect these acquisitions to generate approximately $640 million in annual revenue. At the same time, we disposed of 13 dealerships comprising 32 franchises, which had generated approximately $775 million in annualized revenue. In addition, we repurchased more than 10% of our outstanding shares in 2025. In the UK, the macroeconomic environment remains challenging, with weak economic growth, persistent inflation, increased competition from new entrants, and margin pressure from the BEV mandate. In response, we've reduced headcount by an additional 537 positions in 2025. During the quarter, we continued to execute on our previously announced restructuring initiatives, including working with a number of interested parties on the exit of the JLR brand.
In the UK, we acquired three Toyota and one Lexus dealership. We expect these acquisitions to generate approximately $640 million in annual revenue. At the same time, we disposed of 13 dealerships comprising 32 franchises, which had generated approximately $775 million in annualized revenue. In addition, we repurchased more than 10% of our outstanding shares in 2025. In the UK, the macroeconomic environment remains challenging, with weak economic growth, persistent inflation, increased competition from new entrants, and margin pressure from the BEV mandate. In response, we've reduced headcount by an additional 537 positions in 2025. During the quarter, we continued to execute on our previously announced restructuring initiatives, including working with a number of interested parties on the exit of the JLR brand.
Speaker #3: Which had generated approximately $775 million in annualized revenue. In addition, we repurchased more than 10% of our outstanding shares in 2025. In the UK, the macroeconomic environment remains challenging.
Speaker #3: With weak economic growth, persistent inflation, increased competition from new entrants, and margin pressure from the BEV mandate, we have reduced headcount by an additional 537 positions in 2025.
Speaker #3: And during the quarter, we continue to execute on our previously announced restructuring initiatives. Including working with a number of interested parties on the exit of the JLR brand.
Daryl Kenningham: We also completed our UK systems integration, which we expect will improve visibility, operational consistency, and data-driven decision-making across the business. In addition, we consolidated 10 customer contact centers into two and fully onshored our transactional accounting operations. We continue to focus on opportunities to further shape our UK portfolio and improve operations. Consistent with the playbook, we have successfully executed in the US. We are seeing positive impact of our US operating practices in the UK, particularly in aftersales. On a same-store basis, we increased our technician headcount by 9.5% in the UK, reducing customer wait times and driving a nearly 6 percentage point increase in customer pay mix and higher fixed absorption. We've made changes to our service pricing to move more closely to the aftermarket. At the same time, we've eliminated diagnosis fees in many brands.
We also completed our UK systems integration, which we expect will improve visibility, operational consistency, and data-driven decision-making across the business. In addition, we consolidated 10 customer contact centers into two and fully onshored our transactional accounting operations. We continue to focus on opportunities to further shape our UK portfolio and improve operations. Consistent with the playbook, we have successfully executed in the US. We are seeing positive impact of our US operating practices in the UK, particularly in aftersales. On a same-store basis, we increased our technician headcount by 9.5% in the UK, reducing customer wait times and driving a nearly 6 percentage point increase in customer pay mix and higher fixed absorption. We've made changes to our service pricing to move more closely to the aftermarket. At the same time, we've eliminated diagnosis fees in many brands.
Speaker #3: completed our UK Systems We also Integration which we expect will improve visibility, operational consistency, and data-driven decision-making across the business. In addition, we consolidated 10 customer contact centers into two and fully onshored our transactional We continue to focus on opportunities accounting operations.
Speaker #3: to further shape our UK portfolio and improve operations. Consistent with the playbook, we have successfully executed in the US. We are seeing positive impact of our US operating practices in the UK.
Speaker #3: Particularly in after-sales. On a same-store basis, we increased our technician headcount by 9.5% in the UK. Reducing customer wait times and driving a nearly 6 percentage point increase in customer pay mix and higher fixed absorption.
Speaker #3: We've made changes to our service pricing to move more closely to the after-market. At the same time, we've eliminated diagnosis fees in many brands.
Speaker #3: Daniel McHenry will speak to the positive results that these initiatives are having on our RO counts. In F&I, PRU increased 13% in the UK.
Daryl Kenningham: Daniel McHenry will speak to the positive results that these initiatives are having on our RO counts. In F&I, PRU increased 13% in the UK, or $123, largely through better adoption of all of our products. Our focus in the UK remains on driving this type of operational improvement across the entire business, and we realize there is still more work to do. In the US, the macro environment remains dynamic, with volumes and GPUs continuing to normalize from post-pandemic highs, particularly in the luxury segment. While the policy and trade uncertainty we saw last year has largely subsided, we remain vigilant and focused on staying nimble as macroeconomic conditions evolve. In response, our teams remain disciplined and agile, sharpening execution at the dealership level, managing our costs, and prioritizing the areas of the business that generate the most durable returns.
Daniel McHenry will speak to the positive results that these initiatives are having on our RO counts. In F&I, PRU increased 13% in the UK, or $123, largely through better adoption of all of our products. Our focus in the UK remains on driving this type of operational improvement across the entire business, and we realize there is still more work to do. In the US, the macro environment remains dynamic, with volumes and GPUs continuing to normalize from post-pandemic highs, particularly in the luxury segment. While the policy and trade uncertainty we saw last year has largely subsided, we remain vigilant and focused on staying nimble as macroeconomic conditions evolve. In response, our teams remain disciplined and agile, sharpening execution at the dealership level, managing our costs, and prioritizing the areas of the business that generate the most durable returns.
Speaker #3: Or $123. Largely through better adoption of all of our products. Our focus in the UK remains on driving this type of operational improvement across the entire business.
Speaker #3: And we realize there is still more work to do. In the US, the macro involvement environment remains dynamic. With volumes and GPUs continuing to normalize from post-pandemic highs.
Speaker #3: Particularly in the luxury segment. While the policy and trade uncertainty we saw last year has largely subsided, we remain vigilant and focused on staying nimble as macroeconomic conditions evolve.
Speaker #3: In response, our teams remain disciplined and agile. Sharpening execution at the dealership level, managing our costs, and prioritizing the areas of the business that generate the most durable returns.
Speaker #3: We believe this focus on controlling what we can control—from inventory and pricing discipline to after-sales performance, capital allocation, and costs—positions Group 1 to navigate near-term challenges while continuing to build a stronger, more resilient platform for the long term.
Daryl Kenningham: We believe this focus on controlling what we can control, from inventory and pricing discipline to aftersales performance, capital allocation, and costs, positions Group 1 to navigate near-term challenges while continuing to build a stronger, more resilient platform for the long term. I'll now turn the call over to our CFO, Daniel McHenry, for an operating and financial overview.
We believe this focus on controlling what we can control, from inventory and pricing discipline to aftersales performance, capital allocation, and costs, positions Group 1 to navigate near-term challenges while continuing to build a stronger, more resilient platform for the long term. I'll now turn the call over to our CFO, Daniel McHenry, for an operating and financial overview.
Speaker #3: I'll now turn the call over to our CFO, Daniel McHenry, for an operating and financial overview.
Speaker #4: Thank you, Daryl, and good morning, everyone. In the fourth quarter of 2025, Group 1 Automotive reported revenues of $5.6 billion. Gross profit of $874 million.
Daniel McHenry: Thank you, Daryl, and good morning, everyone. In Q4 2025, Group 1 Automotive reported revenues of $5.6 billion, gross profit of $874 million, adjusted net income of $105 million, and adjusted diluted EPS of $8.49 from continuing operations. Starting with our US operations. Q4 performance was strong across all lines of business, with a slight decline in new vehicle sales. New vehicle unit sales declined both on a reported and same-store basis. Average selling prices continue to increase, and consumers are increasingly concerned about affordability. While new vehicle GPUs continue to moderate from the highs of the past few years, we have maintained strong operational discipline through effective cost management and process consistency.
Daniel McHenry: Thank you, Daryl, and good morning, everyone. In Q4 2025, Group 1 Automotive reported revenues of $5.6 billion, gross profit of $874 million, adjusted net income of $105 million, and adjusted diluted EPS of $8.49 from continuing operations. Starting with our US operations. Q4 performance was strong across all lines of business, with a slight decline in new vehicle sales. New vehicle unit sales declined both on a reported and same-store basis. Average selling prices continue to increase, and consumers are increasingly concerned about affordability. While new vehicle GPUs continue to moderate from the highs of the past few years, we have maintained strong operational discipline through effective cost management and process consistency.
Speaker #4: Adjusted net income of $105 million. And adjusted diluted EPS of $8.49 from continuing operations. Starting with our US operations. Fourth quarter performance was strong across all lines of business, with a slight decline in new vehicle sales.
Speaker #4: New vehicle unit sales declined both on a reported and same-store basis. Average selling prices continue to increase and consumers are increasingly concerned about affordability.
Speaker #4: While new vehicle GPUs continue to moderate from the highs of the past few years, we have maintained strong operational discipline through effective cost management and process consistency.
Speaker #4: Our used vehicle operations performed well. Holding volumes basically flat versus a comparable year quarter. While increasing revenues approximately 4% and 1% on an as-reported and same-store basis.
Daniel McHenry: Our used vehicle operations performed well, holding volumes basically flat versus a comparable year quarter, while increasing revenues approximately 4% and 1% on an as-reported and same-store basis. GPUs declined approximately 8% on a same-store basis, reflecting higher costs to acquire used inventory. We continue to leverage our scale and operational flexibility to strengthen used vehicle acquisition, while executing disciplined sourcing and pricing in an increasingly competitive market. Our Q4 F&I GPUs grew nearly 3%, or $67 and $65 on a reported and a same-store basis versus prior year comparable period, respectively. The disciplined performance by our F&I professionals and improvements to our virtual finance operations has helped grow GPUs while driving higher product penetration across nearly all product categories. After-sales again stood out as a major contributor.
Our used vehicle operations performed well, holding volumes basically flat versus a comparable year quarter, while increasing revenues approximately 4% and 1% on an as-reported and same-store basis. GPUs declined approximately 8% on a same-store basis, reflecting higher costs to acquire used inventory. We continue to leverage our scale and operational flexibility to strengthen used vehicle acquisition, while executing disciplined sourcing and pricing in an increasingly competitive market. Our Q4 F&I GPUs grew nearly 3%, or $67 and $65 on a reported and a same-store basis versus prior year comparable period, respectively. The disciplined performance by our F&I professionals and improvements to our virtual finance operations has helped grow GPUs while driving higher product penetration across nearly all product categories. After-sales again stood out as a major contributor.
Speaker #4: GPUs declined approximately 8% on a same-store basis, reflecting higher costs to acquire used inventory. We continue to leverage our scale and operational flexibility to strengthen used vehicle acquisition while executing disciplined sourcing and pricing in an increasingly competitive market.
Speaker #4: Our fourth quarter F&I GPUs grew nearly 3%. Our 67 dollars and 65 dollars on a reported and as same-store basis versus prior year comparable period, respectively.
Speaker #4: The
Speaker #1: A performance by our fans , professionals and improvements to our virtual finance operations has helped grow GPUs while driving higher product penetration across nearly all product categories .
Speaker #1: Operations has helped grow GPUs while driving higher product penetration across nearly all product categories . After sales again stood out as a major contributor .
Daniel McHenry: Gross profit continues to benefit from our efforts to optimize our collision footprint, shifting collision space opportunistically to additional traditional service capacity and closing collision centers where the returns do not meet our requirements. Revenues from customer pay and warranty increased approximately 5% and 11%, respectively, and gross profits from customer pay and warranty increased over 8% and thirteen percent, respectively. Our technician recruiting and retention efforts continue to pay off, with same-store technicians up 2.3% year-over-year. Overall, our US business continues to perform exceptionally well, demonstrating both resiliency of customer demand and the effectiveness of our disciplined, process-driven operating model. Wrapping up the US, let's shift to SG&A. While US adjusted SG&A as a percent of gross profit increased 200 basis points sequentially to 67.8%, higher employee expense was the primary driver.
Gross profit continues to benefit from our efforts to optimize our collision footprint, shifting collision space opportunistically to additional traditional service capacity and closing collision centers where the returns do not meet our requirements. Revenues from customer pay and warranty increased approximately 5% and 11%, respectively, and gross profits from customer pay and warranty increased over 8% and thirteen percent, respectively. Our technician recruiting and retention efforts continue to pay off, with same-store technicians up 2.3% year-over-year. Overall, our US business continues to perform exceptionally well, demonstrating both resiliency of customer demand and the effectiveness of our disciplined, process-driven operating model. Wrapping up the US, let's shift to SG&A. While US adjusted SG&A as a percent of gross profit increased 200 basis points sequentially to 67.8%, higher employee expense was the primary driver.
Speaker #1: Gross profit continues to benefit our efforts to optimize our collision from footprint . Shifting collision space opportunistically to additional traditional service capacity and closing collision centers for the returns do not meet our requirements .
Speaker #1: Revenues from customer pay and warranty increased . US business Overall , our continues to perform exceptionally well , demonstrating both resiliency of customer and the demand effectiveness of our disciplined , process driven operating model .
Speaker #1: Wrapping up the US . Let's shift to G&A . While US adjusted SG&A as percent of a gross profit increased 200 basis points sequentially to 67.8% , higher employee expense was the primary driver .
Daniel McHenry: We continue to focus heavily on resource management and technology investments to try to maintain SG&A as a percent of gross profit below pre-COVID levels as vehicle GPUs continue to normalize. Turning to the UK. Results reflected the ongoing challenge of the UK operating environment. However, same-store revenues grew almost across every business line. New vehicle same-store volumes declined 8.2%, and local currency GPUs moderated 3.2% versus the prior year quarter, leading to an 11% decline in local currency same-store new vehicle revenues. Used vehicle same-store revenues were up over 9% on a local currency basis, with volumes up nearly 8%. Same-store GPUs declined almost 19% on a local currency basis, leading to a decline in used vehicle GP, reflecting the ongoing challenging used market in the UK.
We continue to focus heavily on resource management and technology investments to try to maintain SG&A as a percent of gross profit below pre-COVID levels as vehicle GPUs continue to normalize. Turning to the UK. Results reflected the ongoing challenge of the UK operating environment. However, same-store revenues grew almost across every business line. New vehicle same-store volumes declined 8.2%, and local currency GPUs moderated 3.2% versus the prior year quarter, leading to an 11% decline in local currency same-store new vehicle revenues. Used vehicle same-store revenues were up over 9% on a local currency basis, with volumes up nearly 8%. Same-store GPUs declined almost 19% on a local currency basis, leading to a decline in used vehicle GP, reflecting the ongoing challenging used market in the UK.
Speaker #1: We continue to focus heavily on resource management and technology investments to try to maintain G&A as a percent of gross profit below pre-COVID levels .
Speaker #1: As GPUs continue to normalize . Turning to the UK , results reflected the ongoing challenge of the UK operating environment . However , same store revenues grew almost across every business line .
Speaker #1: New store vehicle , same volumes declined 8.2% and local currency GPUs moderated 3.2% versus the prior year quarter , leading to an 11% decline in local currency .
Speaker #1: Same store U.K. revenues. Growth, specifically same store revenues, were up over 9% on a local currency basis, with volumes nearly up 8%.
Speaker #1: Same store GPUs declined almost 19% on a local currency basis , leading to a decline in used vehicle GP , reflecting the ongoing challenging used market in the UK .
Daniel McHenry: After-sales and F&I delivered year-over-year growth in both revenue and gross profit on an as-reported and same-store basis. The after-sales business remains an important stabilizer within UK operations, and along with F&I, it's a key area of focus as we work to enhance profitability. We saw an outsized uplift in RO count of nearly 36% year-over-year as we bring best practices from the US. Same-store technicians are up 9.5%, reflecting significant capacity to our shops. Customer pay revenue was up 9% year-over-year. Same-store F&I PRU reached $1,060, with an as-reported and same-store PRU increasing over 13% year-over-year. On expenses, SG&A declined from prior year, reflecting cost improvements despite significant headwinds from inflation and cost increases, some of which is government-imposed through payroll tax and related charges.
After-sales and F&I delivered year-over-year growth in both revenue and gross profit on an as-reported and same-store basis. The after-sales business remains an important stabilizer within UK operations, and along with F&I, it's a key area of focus as we work to enhance profitability. We saw an outsized uplift in RO count of nearly 36% year-over-year as we bring best practices from the US. Same-store technicians are up 9.5%, reflecting significant capacity to our shops. Customer pay revenue was up 9% year-over-year. Same-store F&I PRU reached $1,060, with an as-reported and same-store PRU increasing over 13% year-over-year. On expenses, SG&A declined from prior year, reflecting cost improvements despite significant headwinds from inflation and cost increases, some of which is government-imposed through payroll tax and related charges.
Speaker #1: After sales and FNI year over delivered year growth in both and revenue gross profit an as reported and on same store basis , the after sales business remains an important stabilizer within UK operations and along with FNI , is a key area of focus as we work to enhance profitability .
Speaker #1: We saw an outsized uplift in our O count of nearly 36% year over year as we bring best practices from the US same store technicians are up 9.5% , reflecting significant capacity to our shops customer pay revenue was up over 9% year year store FNI .
Speaker #1: Same , Pru reached $1,060 with an as reported and same store . Pru increasing over 13% year over year . On expenses , G&A declined from prior year , reflecting cost improvements despite significant headwinds from inflation and cost increases , some of which is government imposed through payroll tax and related charges .
Daniel McHenry: While we've executed targeting restructuring initiatives to improve efficiency and return the business to more sustainable cost levels, the environment remains difficult. During the quarter, we incurred modest non-recurring restructuring costs tied to our restructuring efforts. We are executing additional restructuring plans in the future periods as we exit select OEM sites. We are continuously taking decisive actions in the UK to control costs, strengthen operational efficiency, and position the business for improved returns as market conditions stabilize. Turning to our balance sheet and liquidity. Our strong balance sheet, cash flow generation, and leverage position continue to support flexible capital allocation approach. As of December 31, our liquidity of $883 million was comprised of accessible cash of $537 million, and $346 million available to borrow on our acquisition line.
While we've executed targeting restructuring initiatives to improve efficiency and return the business to more sustainable cost levels, the environment remains difficult. During the quarter, we incurred modest non-recurring restructuring costs tied to our restructuring efforts. We are executing additional restructuring plans in the future periods as we exit select OEM sites. We are continuously taking decisive actions in the UK to control costs, strengthen operational efficiency, and position the business for improved returns as market conditions stabilize. Turning to our balance sheet and liquidity. Our strong balance sheet, cash flow generation, and leverage position continue to support flexible capital allocation approach. As of December 31, our liquidity of $883 million was comprised of accessible cash of $537 million, and $346 million available to borrow on our acquisition line.
Speaker #1: While we've executed targeting initiatives restructuring to improve efficiency and return the business to more sustainable cost levels , the environment remains difficult . During the quarter , we incurred modest , non-recurring restructuring costs tied to our restructuring efforts .
Speaker #1: are We executing additional restructuring plans in the future periods as we exit select OEM sites . We are continuously taking decisive actions in the UK to control costs , strengthen operational efficiency and position the business for improved returns as market conditions stabilize .
Speaker #1: Turning to our balance sheet and liquidity . Our strong balance sheet cash flow generation and leveraged position continue to support flexible capital allocation approach .
Speaker #1: As of December 31st , our liquidity of 883 million was comprised of accessible cash of 537 million and 346 million available to borrow on our acquisition line .
Daniel McHenry: Our rent-adjusted leverage, as defined by our US credit facility, was 3.1 times at the end of December. Cash flow generation year-to-date 2025 yielded $699 million of adjusted operating cash flow, and $494 million of free cash flow after backing out $205 million of CapEx. This capital was deployed in the same period through a combination of acquisitions, share repurchases, and dividends, including the acquisition of $640 million of revenues through December 31, $555 million, repurchasing approximately 1.3 million shares at an average price of $413.05, and $26 million in dividends to our shareholders.
Our rent-adjusted leverage, as defined by our US credit facility, was 3.1 times at the end of December. Cash flow generation year-to-date 2025 yielded $699 million of adjusted operating cash flow, and $494 million of free cash flow after backing out $205 million of CapEx. This capital was deployed in the same period through a combination of acquisitions, share repurchases, and dividends, including the acquisition of $640 million of revenues through December 31, $555 million, repurchasing approximately 1.3 million shares at an average price of $413.05, and $26 million in dividends to our shareholders.
Speaker #1: Our adjusted leverage , as defined by our US credit facility , was 3.1 times at the end of December , cash flow generation , year to date , 2025 yielded 699 million of adjusted operating cash flow and 494 million of free cash flow .
Speaker #1: After backing out 205 million of CapEx , this capital was deployed in the same period through a of acquisitions , share repurchases and dividends , including the acquisition of 640 million of revenues through December 31st , 555 million .
Speaker #1: We approximately 1.3 million shares at an average price of $413.05 and 26 million in dividends to our shareholders . quarter , we Subsequent to the fourth an additional repurchased under a 71,750 shares rule 1051 trading plan at an average price per common share of $394.20 , for a total cost of resulting in an 0.6% reduction share count approximate in our since January .
Daniel McHenry: Subsequent to Q4, we repurchased an additional 71,750 shares under a Rule 10b5-1 trading plan at an average price per common share of $394.20, for a total cost of $28.3 million, resulting in an approximate 0.6% reduction in our share count since January 1. We currently have $350 million remaining on our board-authorized common share repurchase plan. For additional detail regarding our financial condition, please refer to the schedules of additional information attached to our news release, as well as our investor presentation posted on our website. I will now turn the call over to the operator to begin the question and answer session.
Subsequent to Q4, we repurchased an additional 71,750 shares under a Rule 10b5-1 trading plan at an average price per common share of $394.20, for a total cost of $28.3 million, resulting in an approximate 0.6% reduction in our share count since January 1. We currently have $350 million remaining on our board-authorized common share repurchase plan. For additional detail regarding our financial condition, please refer to the schedules of additional information attached to our news release, as well as our investor presentation posted on our website. I will now turn the call over to the operator to begin the question and answer session.
Speaker #1: We The first . currently have 350 million remaining on our board , authorized common share repurchase plan for additional detail regarding our financial condition , please refer to the schedules of additional information attached to our news release , as well as our investor presentation posted on our I website .
Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. We ask that you please limit yourself to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. The first question today will come from Rajat Gupta with JPMorgan. Please go ahead.
Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. We ask that you please limit yourself to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. The first question today will come from Rajat Gupta with JPMorgan. Please go ahead.
Speaker #1: will now turn the call over to the operator to begin the question and answer session .
Speaker #2: Thank you . We will now begin the question and session . answer To ask a question , you may press star . Then one on your telephone keypad .
Speaker #2: you are using a If speakerphone , up your please pick handset before pressing the keys . To withdraw your question , please press star then two we ask that you please limit yourself to one question and one follow up .
Speaker #2: At this time, we will pause momentarily to assemble our roster. The first question today will come from Rajat Gupta with JP Morgan.
Rajat Gupta: Great. Thanks, thanks for taking the question. Just one clarification. Could you give us a sense of, you know, what the impairments were tied to this quarter? I know we had a large one last quarter, but were there any significant assets or brands that the impairment was tied to this quarter? And I have a follow-up. Thanks.
Rajat Gupta: Great. Thanks, thanks for taking the question. Just one clarification. Could you give us a sense of, you know, what the impairments were tied to this quarter? I know we had a large one last quarter, but were there any significant assets or brands that the impairment was tied to this quarter? And I have a follow-up. Thanks.
Speaker #2: Please go ahead .
Speaker #3: Great , thanks . Thanks for taking the question . Just one clarification . Could you could you give us a sense of , you know , what the impairments were tied to this quarter ?
Speaker #3: I know we had a large one last quarter, but were there any significant assets or brands that the impairment was tied to this quarter?
Daniel McHenry: Hi, Rajat, it's Daniel. We do an annual impairment for all of our assets within Q4 on an annual basis. The impairments related virtually totally to the US business, as the impairments in Q3 were related to the UK business. You know, the principal brand, I guess, that we had impairments within was within the Audi brand, and, you know, we've had various discussions on that on previous calls. You know, other impairments, the Maryland or DC market has been a difficult market, I think, for, you know, both us and the other consolidators this year, and there was an impairment taken within that market.
Daniel McHenry: Hi, Rajat, it's Daniel. We do an annual impairment for all of our assets within Q4 on an annual basis. The impairments related virtually totally to the US business, as the impairments in Q3 were related to the UK business. You know, the principal brand, I guess, that we had impairments within was within the Audi brand, and, you know, we've had various discussions on that on previous calls. You know, other impairments, the Maryland or DC market has been a difficult market, I think, for, you know, both us and the other consolidators this year, and there was an impairment taken within that market.
Speaker #3: And I have a follow-up. Thanks.
Speaker #1: Hi, Rajat. It's Daniel. We do an annual impairment for all of our ACID within quarter four on an annual basis.
Speaker #1: The impairments related virtually totally to the US business is the impairments in quarter three were related to the UK business . You know , the principal brand , I guess that we had impairments within was within the Audi brand .
Speaker #1: You various had discussions on that on on previous calls , you impairments . The , the Maryland stroke , market has DC been a difficult market , I think , for , you know , both us and the other Consolidators this year .
Rajat Gupta: Understood. That's very clear. Maybe a bit of a broader question as we go into 2026 around SG&A. I know you've talked about a lot of initiatives in the UK, just both on the productivity side and some of the cost actions. But curious, are there any specific productivity-type actions that you might be undertaking in the US today that could meaningfully move the needle? Especially with more and more AI tools likely to get deployed, I'm curious, like, where do you see the opportunity? Are you already working on some? And how should we think about the impact to the SG&A to gross?
Rajat Gupta: Understood. That's very clear. Maybe a bit of a broader question as we go into 2026 around SG&A. I know you've talked about a lot of initiatives in the UK, just both on the productivity side and some of the cost actions. But curious, are there any specific productivity-type actions that you might be undertaking in the US today that could meaningfully move the needle? Especially with more and more AI tools likely to get deployed, I'm curious, like, where do you see the opportunity? Are you already working on some? And how should we think about the impact to the SG&A to gross?
Speaker #1: And there was an impairment taken within that market .
Speaker #3: Understood . That's very clear . Maybe a bit of a broader question , you know , as you go into 2026 around SG&A , I know you've talked about a lot of initiatives in the UK .
Speaker #3: You know , just both both in the productivity side and some of the cost actions . But curious , you are there any know , specific productivity type actions that you might be undertaking in the US today that could meaningfully move the needle , especially with , you know , more and more AI tools likely to get deployed ?
Speaker #3: I'm curious , like where do you see the opportunity ? Are you already working on some should we and how think the to impact DSG growth ?
Daryl Kenningham: Rajat, we are using AI in every part of our business, both customer interface as well as in our back office. And we're also deploying productivity tools in a number of areas. Like, as an example, when you look at our after-sales growth this quarter, it was 6% up, 5% up on a same store basis on customer pay and 9% on warranty. We only added 2.5% to our technician base, so our technicians are more productive now. One of the reasons is 'cause our turnover is down 10 points in our technician population, which we've been working on. We've talked to you about the investments in things like air conditioning and things like that in our shops.
Daryl Kenningham: Rajat, we are using AI in every part of our business, both customer interface as well as in our back office. And we're also deploying productivity tools in a number of areas. Like, as an example, when you look at our after-sales growth this quarter, it was 6% up, 5% up on a same store basis on customer pay and 9% on warranty. We only added 2.5% to our technician base, so our technicians are more productive now. One of the reasons is 'cause our turnover is down 10 points in our technician population, which we've been working on. We've talked to you about the investments in things like air conditioning and things like that in our shops.
Speaker #4: Rajan we are using AI in every part of our business customer , both interface as well as in our back office and we're also deploying productivity tools in a number of areas , like as an example , when you look at our .
Speaker #4: After sales growth this quarter , it was 6% up , store 5% up on a same basis on customer pay . And warranty nine on .
Speaker #4: We only added 2.5% to our technician base . So our technicians are more productive . Now . One of the reasons is because our turnover is down ten points and our technician population , which we've been working on , we've talked to you about the investments and things like air conditioning and things like our shops .
Daryl Kenningham: And so we're seeing tangible results, which is resulting in less turnover and more productivity and takes the pressure off of all the hiring that we do on the technicians. So that's a productivity gain for us. Initiatives like virtual F&I, which we've got in a ton of stores now. We're rolling that out nationwide. We're seeing lower cost per transaction on virtual F&I across our footprint and wide adoption there. And we are using AI in our sales operations with lead management and CRM control. We're using it in parts and service and in marketing in reaching out to customers and using more predictive analytics in that area.
And so we're seeing tangible results, which is resulting in less turnover and more productivity and takes the pressure off of all the hiring that we do on the technicians. So that's a productivity gain for us. Initiatives like virtual F&I, which we've got in a ton of stores now. We're rolling that out nationwide. We're seeing lower cost per transaction on virtual F&I across our footprint and wide adoption there. And we are using AI in our sales operations with lead management and CRM control. We're using it in parts and service and in marketing in reaching out to customers and using more predictive analytics in that area.
Speaker #4: that in seeing And so tangible results , which is resulting in and more turnover productivity and takes the pressure off of all the hiring that we do on technicians .
Speaker #4: So that's a productivity gain for us like . Initiatives virtual Fab , which we've got in a ton of stores now we're rolling that out nationwide .
Speaker #4: We're seeing lower cost per transaction on virtual across our footprint and wide adoption . There . And we are we are using AI in our sales operations with lead management and CRM control .
Daryl Kenningham: And so as we've made investments, especially in marketing, where we're now owning our own data, managing our own customer data, it's going to allow us to be much more efficient with how we reach customers and what our costs are, and we hope in a more productive way than in the past. So the short answer is yes, we're using it. We're using it in a number of areas, and offline, I'd be happy to talk to you more specifically about that.
Speaker #4: We're using it in parts service and in marketing and reaching out to customers and using more predictive analytics in that area . And so as we've made investments , especially in marketing , where we're now owning our own data , managing our own customer data , it's going to allow us to be much more efficient with how we reach customers and what our costs are to do that .
And so as we've made investments, especially in marketing, where we're now owning our own data, managing our own customer data, it's going to allow us to be much more efficient with how we reach customers and what our costs are, and we hope in a more productive way than in the past. So the short answer is yes, we're using it. We're using it in a number of areas, and offline, I'd be happy to talk to you more specifically about that.
Speaker #4: hope in a And we more productive way than in the past . So answer is the short yes , we're using it . We're using it in a number of areas offline .
Operator: The next question will come from Bret Jordan with Jefferies. Please go ahead.
Operator: The next question will come from Bret Jordan with Jefferies. Please go ahead.
Speaker #4: happy to talk to you Be more specifically about that .
[Analyst] (Jefferies): Hey, good morning, guys. This is Patrick Buckley on for Bret. Thanks for taking our questions. As we look at the UK restructuring plan, you spoke a bit about recent progress there. Could you talk a bit more about what inning that's in, and how long of a process do you expect that to be? And I guess, is there a lot of front-loaded progress there, or is there more of a steady schedule of work to be done?
Bret Jordan: Hey, good morning, guys. This is Patrick Buckley on for Bret. Thanks for taking our questions. As we look at the UK restructuring plan, you spoke a bit about recent progress there. Could you talk a bit more about what inning that's in, and how long of a process do you expect that to be? And I guess, is there a lot of front-loaded progress there, or is there more of a steady schedule of work to be done?
Speaker #2: The next question will come from Brett Jordan with Jefferies . Please go ahead .
Speaker #5: Hey , good morning guys . This is Patrick Buckley on for Bret . Thanks for taking our questions . As we look at the UK restructuring plan , you spoke a bit about recent progress .
Speaker #5: There. Could you talk a bit more about what inning that's in, and how long of a process do you expect that to be?
Daryl Kenningham: There's more work to do. We don't see. It's a dynamic environment, especially Europe. And so we adjust, you know, every quarter with our expectations, and we will get the cost to a place where it has to be to make that business at an acceptable profit level for us. So I would say we're in the earlier innings, not the later innings, and Daniel has some thoughts too.
Daryl Kenningham: There's more work to do. We don't see. It's a dynamic environment, especially Europe. And so we adjust, you know, every quarter with our expectations, and we will get the cost to a place where it has to be to make that business at an acceptable profit level for us. So I would say we're in the earlier innings, not the later innings, and Daniel has some thoughts too.
Speaker #5: And I guess, is there a lot of progress there, or is it front-loaded? Is there more of a steady schedule of work to be done?
Speaker #5: ?
Speaker #4: work to do . We don't we don't see . It's a dynamic environment . Especially Europe . And so we adjust , you know , every quarter expectations .
Speaker #4: And we will get to a the cost place where it has to be to make the make the that that business at a , at an profit level for us .
Daniel McHenry: Bret, you know, the one thing that I would add was, you know, the costs came out in 2024 over, over the year. It wasn't all really front-loaded into, you know, Q1, let's say, of 2025. So as we roll into 2026, we should see the benefit of those costs that have been taken out throughout the year, you know, fully baked in for the year in 2026.
Daniel McHenry: Bret, you know, the one thing that I would add was, you know, the costs came out in 2024 over, over the year. It wasn't all really front-loaded into, you know, Q1, let's say, of 2025. So as we roll into 2026, we should see the benefit of those costs that have been taken out throughout the year, you know, fully baked in for the year in 2026.
Speaker #4: I would say we're in the earlier innings. On the later innings, Daniel has some thoughts. And to Bret.
Speaker #1: You know , the one thing that I was , would add you know , the cost came out in 2024 over , over the year .
Speaker #1: It wasn't all really front loaded into quarter one , let's say , of 2025 . So as we roll into 2026 , we should see the benefit of those costs that have been taken throughout the out year .
[Analyst] (Jefferies): Got it. That's helpful. And I guess staying on the UK here, could you talk a bit more about the dynamics between the broader economy headwinds versus increased penetration from Chinese OEMs? Any way to quantify the headwinds between the two?
Bret Jordan: Got it. That's helpful. And I guess staying on the UK here, could you talk a bit more about the dynamics between the broader economy headwinds versus increased penetration from Chinese OEMs? Any way to quantify the headwinds between the two?
Speaker #1: Now, you’re fully baked in for the year in 2026.
Speaker #5: Got it . That's helpful . And I guess staying on the UK here . Could you talk a bit more about the dynamics between the broader economy headwinds versus increased penetration from from Chinese OEMs ?
Daryl Kenningham: Well, the Chinese OEMs are, their Q4 share leveled off at around a little under 12%. You know, they had a big spike from Q4 2024 to Q4 2025. It leveled off a bit. They're, they're not slowing down. I don't, don't mean to make that sound that way, but... And we're not expecting they will. But, it appears that it's leveled off. When we look at the brands we're in, we, we feel like, we're, we're well positioned because we're heavy luxury, which typically the Chinese aren't in at this point. And, so, something we're continuing to watch and, and I, I, you know, expect we'll continue to make moves, to try to, to try to offset their, their impact. What that partic- what that specific impact is, I mean, their market share, I think, speaks the most.
Daryl Kenningham: Well, the Chinese OEMs are, their Q4 share leveled off at around a little under 12%. You know, they had a big spike from Q4 2024 to Q4 2025. It leveled off a bit. They're, they're not slowing down. I don't, don't mean to make that sound that way, but... And we're not expecting they will. But, it appears that it's leveled off. When we look at the brands we're in, we, we feel like, we're, we're well positioned because we're heavy luxury, which typically the Chinese aren't in at this point. And, so, something we're continuing to watch and, and I, I, you know, expect we'll continue to make moves, to try to, to try to offset their, their impact. What that partic- what that specific impact is, I mean, their market share, I think, speaks the most.
Speaker #5: Any way to quantify the headwinds between the two ?
Speaker #4: Well , the Chinese OEMs are Q4 share leveled off at around a little under 12% . You know , they had a big spike from Q4 of Q4 of 24 to 25 that leveled off a bit .
Speaker #4: They're they're not slowing don't mean to make that sound that way , but and we're not expecting they will . But it appears that it's leveled off when we look at the brands we're in , we feel like we're we're well positioned because we're heavy luxury , which typically the Chinese aren't in at this point .
Speaker #4: And so it's something we're continuing to watch . And I expect we'll continue to make moves to try to to try to offset their their impact .
Daryl Kenningham: You know, they're using a dealer model, which is, you know, I think, good news for dealers. As long as there's a viable model there, we're, we're looking at that business.
You know, they're using a dealer model, which is, you know, I think, good news for dealers. As long as there's a viable model there, we're, we're looking at that business.
Speaker #4: What that what that specific impact is . I mean , their market share I think speaks to most , you know , they're using and a dealer model which is , you know , I think good news for dealers .
[Analyst] (Jefferies): Great. That's all for us. Thanks, guys.
Bret Jordan: Great. That's all for us. Thanks, guys.
Speaker #4: So as long as there's a viable model there , we're looking at that business .
Operator: The next question will come from John Saager with Evercore ISI. Please go ahead.
Operator: The next question will come from John Saager with Evercore ISI. Please go ahead.
Speaker #5: Great . That's all for us . Thanks guys .
[Analyst] (Evercore ISI): Hey, guys. Thanks for taking my question. Obviously, a lot of focus on the portfolio management in the UK. Can you give us a sense of the magnitude of restructuring as you see it today, or are we talking, you know, anywhere near the $28 million that we saw this quarter?
John Saager: Hey, guys. Thanks for taking my question. Obviously, a lot of focus on the portfolio management in the UK. Can you give us a sense of the magnitude of restructuring as you see it today, or are we talking, you know, anywhere near the $28 million that we saw this quarter?
Speaker #2: The next question will come from John Sager with Evercore ISI . Please go ahead .
Speaker #6: guys . Thanks Hey for taking my question . Obviously , a lot of focus on the Can you portfolio the UK . in management us a sense can you give of the magnitude of restructuring as you see it today or we talking , you know , anywhere near the 28 million that we saw this quarter ?
Daniel McHenry: It's Daniel. I don't see it as being anything like that, this quarter, or this year, 2026. You know, we've done significant work. You know, Daryl talked about it in the call earlier today, around what we've done around our DMS, what we've done around our property portfolio, you know, the JLR, you know, the decision that we took, to dispose of those stores, over the next period. You know, a lot of that heavy lifting and, and cost is gone effectively, in terms of the restructuring, that was restructuring costs that were taken in 2025.
Daniel McHenry: It's Daniel. I don't see it as being anything like that, this quarter, or this year, 2026. You know, we've done significant work. You know, Daryl talked about it in the call earlier today, around what we've done around our DMS, what we've done around our property portfolio, you know, the JLR, you know, the decision that we took, to dispose of those stores, over the next period. You know, a lot of that heavy lifting and, and cost is gone effectively, in terms of the restructuring, that was restructuring costs that were taken in 2025.
Speaker #1: It's Daniel. I don't see it being anything like that this quarter or this year, 2026. You know, we've done significant work.
Speaker #1: You know , Daryl talked about it in the call earlier today around what we've done around our DMs , what we've done around our property portfolio .
Speaker #1: You know , the JLR , you know , the decision that we took to dispose of those stores over the next period , you know , a lot of that heavy lifting and cost has gone effectively in terms of restructuring that restructuring costs that we're taken in 2025 .
[Analyst] (Evercore ISI): Okay. Makes sense. And then, you know, post-restructuring, what's a good trend or range going forward for used GPUs and also SG&A as a percent of GP? Could you give us a sense of a range there, and then the timing that it will take to get there?
John Saager: Okay. Makes sense. And then, you know, post-restructuring, what's a good trend or range going forward for used GPUs and also SG&A as a percent of GP? Could you give us a sense of a range there, and then the timing that it will take to get there?
Speaker #6: Okay . Makes sense . And then , you know , post restructuring , what's a good trend range or going forward for us GPUs .
Speaker #6: also And SG&A as a GDP . Could percent of you could you give us a sense of a range there and then and then the timing that it will take there to get .
Daniel McHenry: Is that the UK Pacific or US?
Daniel McHenry: Is that the UK Pacific or US?
[Analyst] (Evercore ISI): Both. But I guess, primarily I was focused on the UK there.
John Saager: Both. But I guess, primarily I was focused on the UK there.
Speaker #1: Is that the UK Pacific or US?
Daryl Kenningham: Well, you know, our used GPUs in the US are higher today than pre-COVID. They're lower than they were a year ago. We'd like to see some improvement in the US, and we definitely know we have some upside in UK GPUs in pre-owned. We're trying to instill a different level of discipline in our pre-owned business in the UK, and we expect the output of that to be better GPU performance. On SG&A, what we've talked about historically in the UK is 80% on a long range basis. It will be higher than that in the non-plate-change quarters, and it'll be hopefully a little lower than that in the plate-change quarters. So those are kind of round numbers, what we've targeted.
Daryl Kenningham: Well, you know, our used GPUs in the US are higher today than pre-COVID. They're lower than they were a year ago. We'd like to see some improvement in the US, and we definitely know we have some upside in UK GPUs in pre-owned. We're trying to instill a different level of discipline in our pre-owned business in the UK, and we expect the output of that to be better GPU performance. On SG&A, what we've talked about historically in the UK is 80% on a long range basis. It will be higher than that in the non-plate-change quarters, and it'll be hopefully a little lower than that in the plate-change quarters. So those are kind of round numbers, what we've targeted.
Speaker #6: Both . But I guess primarily I was focused on the UK . There .
Speaker #4: Well , you know , our , our used GPUs in the US are higher today than they were pre-COVID . They're lower than they were a year ago .
Speaker #4: We'd like to see some improvement in us and we definitely know we have some upside in UK GPUs in pre-owned . We're we're trying to instill a different level of discipline in our in our pre-owned business in the UK , and we expect the output of that to be better .
Speaker #4: GPU performance on SG&A . What we've talked about historically in the UK is 80% on a long range basis . It will be higher than that in the non plate change quarters , and it be will hopefully a little lower than that in the in the plate change quarters .
Daniel McHenry: In terms of US, you know, you would think, you know, mid- to high 60%, for US on an annualized basis, so, you know, somewhere below 70.
Daniel McHenry: In terms of US, you know, you would think, you know, mid- to high 60%, for US on an annualized basis, so, you know, somewhere below 70.
Speaker #4: those So are round numbers . What kind of we've targeted .
Speaker #1: terms of In us you know you would think you know mid to high 60% for us on an annualized basis . So you know some are below 70 .
[Analyst] (Evercore ISI): Okay. Thanks, guys.
John Saager: Okay. Thanks, guys.
Operator: The next question will come from David Whiston with Morningstar. Please go ahead.
Operator: The next question will come from David Whiston with Morningstar. Please go ahead.
Speaker #6: Okay . Thanks guys .
David Whiston: Thanks. Good morning. Just looking at your store disposal activity last year, and by definition, there's always going to be, say, a bottom 10% or bottom quartile, but by divesting these stores, you are raising that, the low end of the bar, so to speak, higher and higher. So do you see the need to do a lot of divestitures perhaps every year, or do you think 2025 was more of an outlier year?
David Whiston: Thanks. Good morning. Just looking at your store disposal activity last year, and by definition, there's always going to be, say, a bottom 10% or bottom quartile, but by divesting these stores, you are raising that, the low end of the bar, so to speak, higher and higher. So do you see the need to do a lot of divestitures perhaps every year, or do you think 2025 was more of an outlier year?
Speaker #2: The next question will come from David Whiston with Morningstar . Please go ahead .
Speaker #7: Thanks . Good morning . Just looking at your your store disposal activity last year . I mean by definition , there's always going to be , say , a bottom 10% or bottom quartile .
Speaker #7: But by divesting these are raising stores you that the low end of the bar , so to speak , higher and higher . So do you see the need to do a lot of divestitures perhaps every year ?
Daryl Kenningham: I think, 2025 was more of an outlier year, David. You know, much of our disposition work was in the UK, around underperforming stores around consolidation efforts in concert with our OEM partners. There will be some more of that in 2026, but on a long-term basis, it won't be nearly that active. In the US, we're still, you know, we still dispose of some stores that are in markets that aren't favorable for us or are underperforming. We had relatively few in 2025 in the US. But we will always want to have that discipline to review our portfolio, and stores that don't help us on SG&A leverage or don't help us on EPS contribution are subject to us disposing them.
Daryl Kenningham: I think, 2025 was more of an outlier year, David. You know, much of our disposition work was in the UK, around underperforming stores around consolidation efforts in concert with our OEM partners. There will be some more of that in 2026, but on a long-term basis, it won't be nearly that active. In the US, we're still, you know, we still dispose of some stores that are in markets that aren't favorable for us or are underperforming. We had relatively few in 2025 in the US. But we will always want to have that discipline to review our portfolio, and stores that don't help us on SG&A leverage or don't help us on EPS contribution are subject to us disposing them.
Speaker #7: Or do you think 25 is more of an outlier year ?
Speaker #4: think I . 25 was more of outlier an year . David , you know , much of our disposition work was in the UK around underperforming stores around consolidation efforts and concert with our OEM partners .
Speaker #4: There will be some more of that in '26, but on a long-term basis, it won't be nearly that active in the U.S.
Speaker #4: We're still , you know , we still dispose of some stores that are in markets that aren't favorable , favorable for us or underperforming .
Speaker #4: We had relatively few in 2025 in the US , but we will always want to have that discipline to review our portfolio and stores that don't help us on SG&A .
Speaker #4: Leverage or help us on don't EPs contribution are subject to us disposing of .
David Whiston: All right, thanks. And on capital allocation for this year, any strong preference between acquisitions, buybacks, or perhaps reducing leverage below three?
David Whiston: All right, thanks. And on capital allocation for this year, any strong preference between acquisitions, buybacks, or perhaps reducing leverage below three?
Speaker #7: All right . Thanks . And capital allocation for this year , any strong preference acquisitions , between buybacks or perhaps reducing leverage below three ?
Daniel McHenry: Let's go from the leverage first. You know, our preference is to keep our leverage below three times, and we're going to continue to work to that. You know, in terms of capital allocation, we really want to grow the company and continue to grow the company through acquisition. We are not going to, however, buy stores that aren't instantly accretive to us as a company in terms of EPS, and we're not going to overpay for acquisitions whenever you look at the valuation of our company in terms of where it's currently sitting. We were very active in terms of buybacks last year, buying back over 10% of the company.
Daniel McHenry: Let's go from the leverage first. You know, our preference is to keep our leverage below three times, and we're going to continue to work to that. You know, in terms of capital allocation, we really want to grow the company and continue to grow the company through acquisition. We are not going to, however, buy stores that aren't instantly accretive to us as a company in terms of EPS, and we're not going to overpay for acquisitions whenever you look at the valuation of our company in terms of where it's currently sitting. We were very active in terms of buybacks last year, buying back over 10% of the company.
Speaker #1: Let's let's go from the leverage . First . You know our preference is to keep our leverage below three times . And we're going to continue to work to that .
Speaker #1: You know, in terms of capital, we really want to allocate it to grow the company and continue to grow the company through acquisition.
Speaker #1: We are not going to , however , buy stores that aren't instantly accretive to us as a company in terms of EPs . And we're not going to overpay for acquisitions .
Speaker #1: Whenever you look at the valuation of our company in terms of where it's currently sitting , we were very active in terms of buybacks last year , buying back over 10% of the company .
Daniel McHenry: You can see, in Q1 so far, we've bought back, you know, 0.6% of the company in, you know, circa 20 days. We will continue to be aggressive, in both terms of acquisitions and buybacks as and when the time is right.
You can see, in Q1 so far, we've bought back, you know, 0.6% of the company in, you know, circa 20 days. We will continue to be aggressive, in both terms of acquisitions and buybacks as and when the time is right.
Speaker #1: You can see in the first quarter so far , we've bought back , you know , 0.6% of the company . And , you know , circa 20 days .
Speaker #1: And continue we will to be in aggressive of acquisitions and buybacks as and when the time is right .
David Whiston: Okay, thank you.
David Whiston: Okay, thank you.
Operator: The next question will come from Jeff Lick with Stephens Inc. Please go ahead.
Operator: The next question will come from Jeff Lick with Stephens Inc. Please go ahead.
Speaker #7: Okay . Thank you .
Jeffrey Francis Lick: Good morning. Thanks for taking the question. Daryl and team, I was wondering, if you just take 2025 as your baseline year, you know, obviously, there was an awful lot that went on this year with tariffs, the EV tax credit expiration, you know, the UK, and, you know, whether it was the road tax, Chinese, you know, OEMs. If you look at 2025 as your base year, and you think about working through 2026, maybe you just talk about how you see the year progressing, you know, in terms of GPU, you know, lapping the EV tax credit, you know, where do you see kind of the easier part of the year versus the harder part of the year?
Jeff Lick: Good morning. Thanks for taking the question. Daryl and team, I was wondering, if you just take 2025 as your baseline year, you know, obviously, there was an awful lot that went on this year with tariffs, the EV tax credit expiration, you know, the UK, and, you know, whether it was the road tax, Chinese, you know, OEMs. If you look at 2025 as your base year, and you think about working through 2026, maybe you just talk about how you see the year progressing, you know, in terms of GPU, you know, lapping the EV tax credit, you know, where do you see kind of the easier part of the year versus the harder part of the year?
Speaker #2: The next question will come from Jeff Lykke with Stephens Inc. . Please go ahead .
Speaker #8: Good morning . taking the Thanks for question . Daryl . And team . I was wondering if you just take 2025 as your year baseline .
Speaker #8: You know , obviously there's an awful lot that went on this year with EV tax tariffs . The credit You know , the expiration .
Speaker #8: UK and you know the road whether it was tax Chinese you know OEMs . If you look at 20 2025 is your base year .
Speaker #8: You think about working through 2026 . You just talk about how you see the year progressing , progressing in terms of GPU , you know , lapping the EV tax credit , you know , where do you see the kind of the easier part of the year versus the harder part of the year ?
Daryl Kenningham: Well, I think, on the EV question, you know, last quarter, our EV mix was 1.3%. That's down a little. I mean, we were three-ish percent before that. So for us, the EV impact, just given our footprint in the United States anyway, is not that big. The margins on EVs are not bad now, you know, compared to where they were a year ago, where they were a disaster. So hopefully, that is a, is a tailwind a little bit. It's on a very small part of our volume, though.
Daryl Kenningham: Well, I think, on the EV question, you know, last quarter, our EV mix was 1.3%. That's down a little. I mean, we were three-ish percent before that. So for us, the EV impact, just given our footprint in the United States anyway, is not that big. The margins on EVs are not bad now, you know, compared to where they were a year ago, where they were a disaster. So hopefully, that is a, is a tailwind a little bit. It's on a very small part of our volume, though.
Speaker #4: I Well , think on EV the . Question you know , last quarter , our EV mix was 1.3% . That's down a little .
Speaker #4: I mean , we were three ish percent before that . So for us , EV impact , just given our footprint in the United States anyway , is not that big .
Speaker #4: The margins on EVs are not bad . Now , you know , compared to where they were a year ago , where they were a disaster .
Daryl Kenningham: On the rest of it, you know, you have plenty of uncertainty out there, obviously, and, you know, what we try to focus our teams on is stay focused on what we can control, because there's plenty of distractions and plenty of things that can lead you to focus on things outside of what we can affect. You know, what we're hoping for is to build on 2025, to try to get to your question, Jeff. We want to build on 2025. We want to grow. If that's organically grow, we, we feel like there's opportunity at Group 1 to organically grow, especially in the UK. But we still have opportunities in our, in our business in the US, too.
On the rest of it, you know, you have plenty of uncertainty out there, obviously, and, you know, what we try to focus our teams on is stay focused on what we can control, because there's plenty of distractions and plenty of things that can lead you to focus on things outside of what we can affect. You know, what we're hoping for is to build on 2025, to try to get to your question, Jeff. We want to build on 2025. We want to grow. If that's organically grow, we, we feel like there's opportunity at Group 1 to organically grow, especially in the UK. But we still have opportunities in our, in our business in the US, too.
Speaker #4: So hopefully that is a is a tailwind a little bit . It's on a very small part of our volume , though , on the rest of it , you know .
Speaker #4: Yeah , plenty of uncertainty out there obviously . And you know what we try to focus our teams on is stay focused on what we can control , because there's plenty of distractions and plenty of things that can lead you to focus on things outside of what we can affect .
Speaker #4: You know what we're hoping for is to build on 2025 , to try to get to your question , Jeff , we want on to build 2025 .
Speaker #4: grow to . If that's organically grow , we feel like there's opportunity at Group one to organically grow , especially in the UK .
Daryl Kenningham: As well as we perform in after sales and F&I, you know, there's still opportunities in our used car business and in our cost structure. So we're continuing to feel like there's opportunity in 2026 on those in the US.
As well as we perform in after sales and F&I, you know, there's still opportunities in our used car business and in our cost structure. So we're continuing to feel like there's opportunity in 2026 on those in the US.
Speaker #4: But we still have opportunities in our in our business in the US too , as well as we perform in Aftersales and and and I , you know , there's still opportunities in our used car business and , and so and in our cost structure .
Jeffrey Francis Lick: Then just a quick follow-up. You know, this year, we're going to see a lot of lease returns. Actually, you know, percentages could be, you know, pretty big as we get into the back half. I'm curious, Daryl, in your career, if you've, if you've seen anything similar to this, I mean, because we're going to be talking about, you know, your lease returns in excess of 30, 40%, you know, what that's going to mean for your business, you know, both in terms of ops and also in terms of your potential used car supply. You know, how big of a deal, do you view this? You know, am I thinking about it maybe, you know, in too grandiose terms? And if, you know, any kind of historical context would be very helpful.
Jeff Lick: Then just a quick follow-up. You know, this year, we're going to see a lot of lease returns. Actually, you know, percentages could be, you know, pretty big as we get into the back half. I'm curious, Daryl, in your career, if you've, if you've seen anything similar to this, I mean, because we're going to be talking about, you know, your lease returns in excess of 30, 40%, you know, what that's going to mean for your business, you know, both in terms of ops and also in terms of your potential used car supply. You know, how big of a deal, do you view this? You know, am I thinking about it maybe, you know, in too grandiose terms? And if, you know, any kind of historical context would be very helpful.
Speaker #4: So we're continuing to feel like there's , there's opportunity in 2026 on those in the US .
Speaker #8: And then just a quick follow up this year we're going to see a lot of lease returns . Actually , you know , percentages could be pretty big as we get into the back half .
Speaker #8: I'm curious , Daryl , in your career , if you've seen anything similar to this , because we can be talking about , you know , lease returns in excess of 30 , 40% .
Speaker #8: You know what that's going to mean for your business , both in terms of ups and also in terms of potential used car big of a How supply .
Speaker #8: deal Do you view ? this ? Am I thinking grandiose about it ? Maybe in too terms . And if any kind of historical context would be very helpful .
Daryl Kenningham: Well, I think two things will happen this year, which will help the used car business. One is the uptick in lease returns, which, you know, a good, solid, controlled source of premium used cars is really great. If you look at the kind of used cars we sell today compared to what we sold pre-COVID, we're selling a much richer mix of pre-owned cars, and the profits are good on those cars. So I hope and expect that will help us later in the year. Another thing is, you know, there's a lot of discussion around the tax returns and tax refunds in the Q1 and Q2, and what kind of impact will that have on the used car business?
Daryl Kenningham: Well, I think two things will happen this year, which will help the used car business. One is the uptick in lease returns, which, you know, a good, solid, controlled source of premium used cars is really great. If you look at the kind of used cars we sell today compared to what we sold pre-COVID, we're selling a much richer mix of pre-owned cars, and the profits are good on those cars. So I hope and expect that will help us later in the year. Another thing is, you know, there's a lot of discussion around the tax returns and tax refunds in the Q1 and Q2, and what kind of impact will that have on the used car business?
Speaker #4: Well , I think two things will happen this year which will help to use our business . One is the in uptick in in lease returns , which , you know , a good solid , controlled source of premium used cars is really great .
Speaker #4: you look at If the kind of used cars we sell today compared to what we sold pre-COVID , we're selling a much richer mix of pre-owned cars and the profits are good on those .
Speaker #4: Those cars . So I hope and expect that that that will help us later in the year . thing Another is there's a lot of discussion around the tax returns and tax refunds and the in the first and second quarter .
Daryl Kenningham: And, you know, we're hopeful it buoys it, you know, and how much, I don't know, but there's plenty of optimism around that. So we'll see how that affects us. We continue to focus heavily on sourcing, especially organic sourcing out of our service drives, and out of our trade processes with appraisals and capture, and we continue to put a ton of focus on that using technology to try to increase that as well.
And, you know, we're hopeful it buoys it, you know, and how much, I don't know, but there's plenty of optimism around that. So we'll see how that affects us. We continue to focus heavily on sourcing, especially organic sourcing out of our service drives, and out of our trade processes with appraisals and capture, and we continue to put a ton of focus on that using technology to try to increase that as well.
Speaker #4: And what kind of impact will that have on on the used car business . And , you know , we're hopeful it believes it .
Speaker #4: You know , and how much I don't know . But there's there's plenty of optimism So we'll see how that affects us . We to focus continue heavily on sourcing , especially organic sourcing out of our out of our service drives and out of our out of our our trade processes with appraisals and capture .
Jeffrey Francis Lick: ... Well, thanks so much for taking my questions, and best of luck this year.
Jeff Lick: ... Well, thanks so much for taking my questions, and best of luck this year.
Speaker #4: And continue to put a ton of focus on that, using technology to try to increase, well, that as well.
Daryl Kenningham: Thank you, Joe.
Daryl Kenningham: Thank you, Joe.
Operator: The next question will come from John Babcock with Barclays. Please go ahead.
Operator: The next question will come from John Babcock with Barclays. Please go ahead.
Speaker #8: Well, thanks so much for taking my questions, and best of luck this year.
Speaker #4: Thank you Jeff .
[Analyst] (Barclays): Hey, good morning, and thanks for taking my questions. Just firstly, on the used vehicle market in the US, you know, at least the indicators that we've seen seem to show that volumes have been pretty good to start the year. But I'm just kind of curious, what are you guys seeing, and what are your expectations for the year? And particularly as we, you know, as you remember, like, last year, there was the tariffs that impacted timing in March and April, and just kind of curious how you're thinking about the cadence of that demand and whether you think it's sustainable from current levels.
John Babcock: Hey, good morning, and thanks for taking my questions. Just firstly, on the used vehicle market in the US, you know, at least the indicators that we've seen seem to show that volumes have been pretty good to start the year. But I'm just kind of curious, what are you guys seeing, and what are your expectations for the year? And particularly as we, you know, as you remember, like, last year, there was the tariffs that impacted timing in March and April, and just kind of curious how you're thinking about the cadence of that demand and whether you think it's sustainable from current levels.
Speaker #2: The next question will come from John Babcock with Barclays. Please go ahead.
Speaker #9: Hey , good morning and thanks for taking my questions . Just firstly on the used vehicle market in the US , you know , at least the indicators that we've seen seem to show that volumes have been pretty good to start the year .
Speaker #9: But I'm just kind of curious what are you guys seeing and what are your the year expectations for and particularly as we , you know , as you remember , like last year , there was the tariffs that impacted timing in March and April .
Pete DeLongchamps: Sure, John, this is Pete DeLongchamps, John. I'll take that question. So we're certainly bullish on the used car opportunity this coming year. And you're correct, January traditionally does start off well because you get the nice trades from November and December that you can work with, and then, you know, you're ready for the spring selling season, which, you know, kicks off about President's Day through March. So we think the volumes are sustainable, and I think that what we're really focusing on is disciplined acquisition, whether that's service to sales coming out of the lane. We've got to be smarter this year, and we're using AI to know exactly what cars to buy from the auction, not just based on personal preference.
Pete DeLongchamps: Sure, John, this is Pete DeLongchamps, John. I'll take that question. So we're certainly bullish on the used car opportunity this coming year. And you're correct, January traditionally does start off well because you get the nice trades from November and December that you can work with, and then, you know, you're ready for the spring selling season, which, you know, kicks off about President's Day through March. So we think the volumes are sustainable, and I think that what we're really focusing on is disciplined acquisition, whether that's service to sales coming out of the lane. We've got to be smarter this year, and we're using AI to know exactly what cars to buy from the auction, not just based on personal preference.
Speaker #9: And just kind of curious how you're thinking about the cadence of that you think and whether it's sustainable from current levels
Speaker #9: . .
Speaker #10: John , this Sure . is I'll Pete . take that question . So we we're certainly bullish on the used car opportunity this coming year .
Speaker #10: And you're correct . January is traditionally does start off well because you've got the nice trades from November and December that you can work with .
Speaker #10: And then you know you're ready for the spring selling season , which , kicks off about Presidents Day through March . So we think the volumes are sustainable .
Speaker #10: And I think that what we're really focusing on is disciplined acquisition , whether that's service to sales coming out of the lane , we've got to be smarter this year and we're using AI to to know exactly what cars to buy from the auction , not just based on personal preference .
Pete DeLongchamps: So there's things that we've put in place that we think that are will continue to help our used business grow. But, you know, all in all, you always have to remember this is a, you know, 38- to 40-million car market, and we talk about SAR at 16 and retail at 13 for new, but the used car market is continually a great source for our company's revenue and gross profits.
So there's things that we've put in place that we think that are will continue to help our used business grow. But, you know, all in all, you always have to remember this is a, you know, 38- to 40-million car market, and we talk about SAR at 16 and retail at 13 for new, but the used car market is continually a great source for our company's revenue and gross profits.
Speaker #10: So there's there's things that we've put in place that we think that will continue to help our business grow . But , you know , all in all , you always have to remember this is a 38 to 40 million car And we talk about .
Speaker #10: Sarat market . 16 and retail for new . at 13 the used car market is continually a great source for our companies revenue and gross profits .
[Analyst] (Barclays): Okay, thanks for that. Then, just my last question, just on GPUs. They were down in Q4, and I, I think at least most of the people I talked to expected a recovery in the quarter. Obviously, luxury demand was, was a little bit soft, and, you know, I, I had heard that there was some increased competition, at least among dealers, just given the broadly softer volumes. But I'm just kind of curious, were there any other factors that we're missing that maybe we should be paying attention to? And what should we be mindful of in terms of thinking about GPUs in Q1 and 2026 more broadly?
John Babcock: Okay, thanks for that. Then, just my last question, just on GPUs. They were down in Q4, and I, I think at least most of the people I talked to expected a recovery in the quarter. Obviously, luxury demand was, was a little bit soft, and, you know, I, I had heard that there was some increased competition, at least among dealers, just given the broadly softer volumes. But I'm just kind of curious, were there any other factors that we're missing that maybe we should be paying attention to? And what should we be mindful of in terms of thinking about GPUs in Q1 and 2026 more broadly?
Speaker #9: Okay . Thanks for that . And then just my last question , just on GPUs , they were down in for Q and I think at least most of the people I talked to expected a recovery in the quarter .
Speaker #9: luxury Obviously , demand was was a little bit soft . And , you know , I had heard that there was some increased competition , at least among dealers , just given the broadly softer volumes .
Speaker #9: But I'm just kind of curious , were there any other factors that were missing that maybe we should be paying attention to ? And what should we be mindful of in terms of thinking about GPUs ?
Daryl Kenningham: Is your question on new car GPUs or used car?
Daryl Kenningham: Is your question on new car GPUs or used car?
[Analyst] (Barclays): Sorry, yeah, new car, specifically.
John Babcock: Sorry, yeah, new car, specifically.
Speaker #9: In Q and 26 ? one More broadly .
Daryl Kenningham: You know, we saw some softening on the luxuries in Q4, GPUs, and that was, you know, affected us more than normal. I would, you know, think that we'll see some moderation of that. I don't know that they'll stay where they were. And the Mercedes of the world, their inventory is in much better shape today than it was a year ago, and BMW's inventory is in really good shape with some new products coming out this year. So I believe that we'll see, you know, firming of the luxury GPUs. But the mass market GPUs are holding up pretty well. I mean, our big brand is Toyota, held up pretty well.
Daryl Kenningham: You know, we saw some softening on the luxuries in Q4, GPUs, and that was, you know, affected us more than normal. I would, you know, think that we'll see some moderation of that. I don't know that they'll stay where they were. And the Mercedes of the world, their inventory is in much better shape today than it was a year ago, and BMW's inventory is in really good shape with some new products coming out this year. So I believe that we'll see, you know, firming of the luxury GPUs. But the mass market GPUs are holding up pretty well. I mean, our big brand is Toyota, held up pretty well.
Speaker #4: Is your question on new car GPUs or used car ?
Speaker #9: Sorry. Yeah, car specifically.
Speaker #4: You know , we saw some softening on the luxuries in the fourth quarter . GPUs . And that was , you know , us affected than normal .
Speaker #4: You know , I would I would , you know , think that we'll see some moderation of that . I don't I don't know that they'll stay where they were .
Speaker #4: And the , the Mercedes of the world , their inventories in much better shape today than it was a year ago . And BMW inventory is in really good shape with some new products coming out this year .
Speaker #4: So I , I believe that we'll that see , you no firming of the of the luxury goods and the mass market GPUs are holding up pretty well .
[Analyst] (Barclays): Okay, thanks.
John Babcock: Okay, thanks.
Daryl Kenningham: Yep.
Daryl Kenningham: Yep.
Speaker #4: I big brand is Toyota held up pretty well .
Operator: This will conclude our question and answer session. I would like to hand the call back over to Mr. Daryl Kenningham for any closing remarks.
Operator: This will conclude our question and answer session. I would like to hand the call back over to Mr. Daryl Kenningham for any closing remarks.
Speaker #9: Okay . Thanks .
Speaker #2: This will conclude our question and answer session . I would like to call back hand the over to Mr. Daryl Kenningham for any closing remarks .
Daryl Kenningham: Thank you. In summary, we remain committed to our strategic initiatives. We focus on our local customers, operating excellence, differentiated aftersales, and disciplined capital management. We'll continue to build on the strong operating results in the US. UK remains a priority as we execute on restructuring initiatives, improving operating discipline, and shaping the portfolio to drive better returns. We believe consistent execution against these priorities positions Group One to navigate near-term challenges while continuing to build long-term value for our shareholders. Thank you all for joining the call.
Daryl Kenningham: Thank you. In summary, we remain committed to our strategic initiatives. We focus on our local customers, operating excellence, differentiated aftersales, and disciplined capital management. We'll continue to build on the strong operating results in the US. UK remains a priority as we execute on restructuring initiatives, improving operating discipline, and shaping the portfolio to drive better returns. We believe consistent execution against these priorities positions Group One to navigate near-term challenges while continuing to build long-term value for our shareholders. Thank you all for joining the call.
Speaker #4: Thank you . In summary , we remain committed to our strategic initiatives . We focus on our local customers operating excellence differentiated after sales and disciplined capital management .
Speaker #4: We'll continue to build on the strong operating results in the US. The UK remains a priority as we execute on restructuring initiatives, improve operating discipline, and shape the portfolio to drive better returns.
Speaker #4: We believe consistent execution against these priorities positions Group 1 to navigate near-term challenges while continuing to build long-term value for our shareholders.
Operator: This will conclude. Pardon me. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Operator: This will conclude. Pardon me. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Speaker #4: Thank you all for joining the call.
Speaker #2: This will conclude our pardon me , the concluded . conference is now Thank you for attending today's presentation . You may now disconnect .
