AutoNation, Inc.

Ladies and gentlemen, thank you for standing by and welcome to AutoNation first quarter 2020 earnings call and audio webcast. At this time, all participants are in a listen only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Robert Cotero, Vice President of Investor Relations. Thank you. Please go ahead.

Thank you. Good morning, and welcome to AutoNation's first quarter 2020 conference call and webcast. Leading our call today will be Mike Jackson, our Chairman and Chief Executive Officer, and Joe Lauer, our Chief Financial Officer. Following their remarks, we will open up the call for questions. I will be available by phone following the call to address any additional questions that you may have. Before we begin, let me read our brief statement regarding forward-looking comments. Certain statements and information on this call, including any statements regarding our anticipated financial results and objectives constitute forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, including economic conditions and changes in applicable regulations that may cause our actual results or performance to differ materially from such forward-looking statements. Additional discussions of factors that could cause our actual results to differ materially are contained in our press release issued earlier today and in our SEC filings, including our most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q and current reports on Form 8-K. And now I'd like to turn the call over to AutoNation's Chairman and Chief Executive Officer, Mike Jackson.

Good morning and thank you for joining us. Today we reported adjusted EPS of continuing operations of 91 cents down only 4% year over year despite significant headwinds caused by the coronavirus. I would like to thank all AutoNation associates across the country for the tremendous effort during these challenging times. Only their hard work and dedication continues to support first responders, essential workers, and communities in which we live and work. On behalf of AutoNation, I would like to say thank you to all who have put themselves on the front lines of this battle pandemic. We are forever grateful. The health and safety of AutoNation's customers and associates is our top priority. AutoNation stores are clean and sanitized multiple times a day. The company has implemented social distancing best practice within the workplace in all our associates and customer interactions, and our stores and delivery program for customers who feel safer at home to complete their transactions. Even with the pandemic and related shelter-in-place orders across the country, Order Nation delivered strong results for the quarter compared to the prior year. Same store first quarter 2020 revenue was $4.7 billion, a decrease of only 5%. Same store first quarter 2020 gross profit totaled $812 million, a decrease of 3%. Same-store variable gross profit was $423 million, a decrease of 5%. Same-store customer care gross profit was $389 million, a decrease of 1% compared to the year-ago period, with customer pay down 2%. The automotive recovery is underway as of May 8th. States from which we derive roughly 50% of our total revenue are largely still under shelter-in-place. or stay-at-home orders compared to 95% beginning of April. In the month of April, we began to see a recovery in our sales. Same store new and used retail unit sales were down approximately 20% in the final 10 days of April compared to down approximately 50% in the first 10 days of the month. We continue to see improvement in our largest markets, Florida, Texas, and California. At the end of March, same-store retail unit sales for Florida, Texas, and California were down approximately 50%, 40%, and 70%, respectively. But by the end of April, retail unit sales in Florida, Texas, and California were down approximately 25%, 5%, to 30%. We expect most manufacturers to resume production in May, and credit is readily available and affordable for our customers. We are also seeing customers return to our service lanes. At the beginning of April, our custom repair orders were down approximately 50%, and at the end of the month, repair orders were down roughly 30%. I'd now like to turn it over to our Chief Financial Officer, Joe Lauer.