Lentuo International Inc. (NYSE: LAS) (“Lentuo” or the “Company”), the largest non-state-owned automobile retailer in Beijing, China as measured by new vehicle sales revenues in 2009, today announced its unaudited financial results for the third quarter of 2010.
Third Quarter 2010 Financial Highlights
- Revenues in the third quarter of 2010 increased 56.0% year-over-year to RMB945.9 million ($141.4 million).
- The number of vehicles sold in the third quarter of 2010 increased 29.5% year-over-year to 4,871 units.
- The average unit price for the third quarter 2010 increased 23% year-over-year to RMB176,000.
- Net income was RMB45.0 million ($6.7 million), an increase of 2.5% from RMB43.9 million in the comparable period of 2009. Diluted earnings per American depositary share (“ADS”) were RMB1.06 ($0.16). Each ADS represents two ordinary shares of the Company.
Mr. Hetong Guo, Founder and Chairman of Lentuo, commented, “We are pleased with our third quarter financial results and our first quarter reporting as a public company. Our rapid revenue growth in the third quarter of 2010 again demonstrates our unique competitive position. Driven by our strong brand, proven business model, and experienced management team, we are very proud that we have grown to become the #1 non-state-owned dealership group in Beijing. Although new traffic control measures in Beijing may negatively impact certain aspects of Lentuo’s business, they may create new opportunities for us as well. We intend to broaden our portfolio of luxury brands, increase the relative contribution of maintenance services to our total revenues, and leverage our leading brand in the Beijing market, stronger financial position and operational scale to acquire smaller dealerships at attractive prices.”
Ms. Ping Yu, Chief Financial Officer of Lentuo, added, “We are delighted to have delivered record revenues in the third quarter. Despite Beijing’s new quota system for new licenses, we remain optimistic about the automobile market potential in Beijing. According to the Provisional Regulations, the quota for new vehicle license plates for 2011 is 240,000. In addition, purchasers of automobiles to replace old vehicles may continue to use the previous license plates and are not subject to the quota. Recent statistics indicate that the number of new vehicles purchased to replace old automobiles, or upgrades, has been approximately 250,000 to 300,000 per year in recent years in Beijing. Therefore, assuming this trend of upgrading continues, and taking into account the 240,000 new licenses to be granted, we believe it is reasonable to estimate the total number of new vehicle purchases in Beijing in 2011 to range from 490,000 to 540,000 units. This range would be similar to the 2009 sales level of 520,000 units, and considerably higher than the 2008 level of 350,000 units. We believe Lentuo is well-positioned to execute on our expansion plans, deliver sustainable financial results and create more value for our shareholders.”