Revenue Analysis:
Total and Operating Revenue: PAG’s operating revenue remained constant at $7,447,800,000 for both Q1 2024 and Q3 2023, indicating stability in business operations. However, there was a slight decrease to $7,272,100,000 by the end of 2023. This suggests a potential softening in market demand or sales.
Gross Profit Margins: Gross profit margins have shown some fluctuation, with gross profit increasing from $1,182,300,000 in Q4 2023 to $1,245,200,000 in Q1 2024. This could indicate improved efficiency in cost management or changes in product mix.
Cost Management:
Cost of Revenue: The cost of revenue was notably high, reaching $6,202,600,000 in Q1 2024 up from $6,084,000,000 at the beginning of 2023. This uptrend highlights rising operational costs that may impact profitability.
Operating Expense: Total operating expenses were maintained at a high level ($917,600,000 in Q1 2024), reflecting substantial cost burdens associated with running the business.
Total Expenses: Similarly, total expenses increased over the period, totaling $7,120,200,000 in Q1 2024, up from $6,965,500,000 at the start of 2023. This growth in expenses needs to be effectively managed to ensure financial health.
Profitability Analysis:
EBITDA: EBITDA stood at $398,700,000 in Q1 2024, reflecting a gradual increase from previous quarters, a positive sign demonstrating operational effectiveness.
Operating Income: Operating income has improved, moving from $373,500,000 at the beginning of 2023 to $327,600,000 by Q1 2024, indicating better operational control and efficiency.
Pretax Income: Pretax income has shown a healthy increase, setting at $294,800,000 in Q1 2024 from $255,800,000 by the end of 2023.
Net Income: Net income has grown consistently, reaching $215,200,000 in Q1 2024, up from $190,700,000 at the end of 2023. This growth is indicative of robust bottom-line profitability.
Cash Flow Indicators:
Reconciled Depreciation: Depreciation expenses have been fairly stable, slightly increasing to $37,800,000 in Q1 2024. This stability helps in predicting cash outflows related to asset depreciation.
Interest Expense: Interest expense maintained a steady rate, amounting to $66,100,000 in Q1 2024, showing consistent financial costs associated with debt.
Taxation:
Tax Provision: The tax provision was $78,600,000 in Q1 2024, showing a notable increase compared to $63,800,000 at the end of 2023, which aligns with increased profits.
Tax Rate: The tax rate was calculated at 26.6621% in Q1 2024, which reflects standard corporate tax obligations after considering allowable deductions and credits.
Shareholder Metrics:
Diluted and Basic EPS: Both diluted and basic EPS have shown an improvement, rising from 2.84 at the end of 2023 to 3.21 in Q1 2024, which inidcates a higher return on each share for shareholders.
Average Shares: The number of average shares stood consistent at approximately 67,100,000, indicating no significant dilution or buybacks during this period.
Net Income Available to Common Stockholders: Has seen an increase consistent with overall net income growth, indicating more profits are available for distribution among common shareholders.
Conclusion:
PAG has demonstrated solid revenue stability with slight variations, well-managed operating and total expenses despite steady increases, and promising growth in net income and EPS. To continue this trajectory, it’s recommended PAG focus on enhancing cost efficiencies and exploring market expansions to sustain and boost revenue streams.