CarMax Posts 21% Jump in Profit

CarMax ( KMX) reported a 21% jump in first-quarter profit, citing stronger-than-expected used-car sales.

The company earned $35.3 million, or 34 cents a share, compared with $29.2 million, or 28 cents a share, in the previous-year quarter. Excluding costs of $1.9 million, or 2 cents a share, related to the company's separation from Circuit City ( CC), the prior year's first-quarter earnings were $31.1 million, or 30 cents a share.

Revenue was $1.17 billion, up 17% from $1.01 billion in the first quarter last year. Used-car sales rose to $890.1 million from $737.8 million last year.

"Strong used-unit sales -- both comps and new store -- were the primary reason that our first-quarter earnings exceeded our original expectations," said CarMax CEO Austin Ligon.

Looking to the second quarter, which ends Aug. 31, the company said it expects earnings of 33 cents to 35 cents a share. Analysts expect 33 cents a share, on average. The company expects comparable-store used-unit sales to rise 6% to 8%. The company earned 31 cents a share in the year-ago second quarter.

Shares of the Richmond, Va.-based company were up 9 cents in morning trading at $29.79.

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