Asbury on Oct. 30 reported net income of $6 million, down 68.4 percent from the year-ago quarter. Year-to-date earnings fell 31.5 percent from the year-ago period, to $27.4 million.
"The headwinds facing Asbury and the auto retailing industry intensified during the third quarter, as consumer confidence sagged under the weight of further declines in the housing and equity markets," said Charles Oglesby, president and CEO.
"In addition, due to the unprecedented turmoil in the credit markets, many lenders -- both captives and independents -- significantly tightened their standards for automotive financing. Not surprisingly, our retail vehicle sales for the quarter were very soft, especially in our key Florida markets, and we were unable to reduce expenses quickly enough to prevent a significant decline in our bottom line," he said in a written statement.
Accordingly, Asbury announced it is suspending its dividend, which had been 22.5 cents per share, stepping up cost-cutting measures, and refraining from acquiring additional dealerships until the business environment improves.
Like other publicly traded retailers, Asbury is far less dependent on traditional Detroit 3 domestic franchises than the U.S. market as a whole, or else its results might have been even worse. In the first quarter, 84 percent of Asbury's units sales came from luxury and mid-line import franchises, versus an average of 47 percent for the U.S. market.
Meanwhile, the company is restructuring, consolidating its regional offices and moving its headquarters from New York to the Atlanta suburb of Duluth, Ga.