Q2’15 COMPANY UPDATE - Lithia Investor RelationsNon-GAAP Financial Measures This presentation...

Q2’15 COMPANY UPDATE

2 LITHIA MOTORS JULY 2015

DISCLOSUREForward-Looking StatementsThis presentation includes “forward-looking statements” within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995.Forward looking statements include statements regarding our goals, plans, projections and guidance regarding our financial position, results of operations, marketposition, pending and potential future acquisitions and business strategy, and often contain words such as “project,” “outlook,” "expect," "anticipate," "intend," "plan,""believe," “estimate,” “may,” "seek," “would,” “should,” “likely,” “goal,” “strategy,” “future,” “maintain,” “continue,” “remain,” “target” or "will" and similar references tofuture periods. Examples of forward-looking statements in this presentation include, among others, statements regarding:• Future market conditions;• Expected operating results, such as improved store performance; continued improvement of SG&A as a percentage of gross profit; generating third quarter

earnings per share of $1.83 to $1.87 per diluted share and 2015 full year earnings of $6.63 to $6.72 per diluted share; and all projections set forth under theheadings “2015 Guidance”;

• Anticipated continued success, integration and growth of DCH;• Anticipated ability to improve store performance; ability to find accretive acquisitions; and additions of dealership locations to the company’s portfolio in the future;

and• Anticipated availability of liquidity from our unfinanced operating real estate.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events that depend on circumstances that may or may not occur inthe future. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity anddevelopment of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this press release. Therisks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation, future economic and financialconditions (both nationally and locally), changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers andother suppliers, risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repayindebtedness on favorable terms), government regulations, legislation and others set forth throughout Part II, Item 7. Management's Discussion and Analysis ofFinancial Condition and Results of Operations and in Part I, Item 1A. Risk Factors of our most recent Annual Report on Form 10-K, and from time to time in ourother filings with the SEC. We urge you to carefully consider this information and not place undue reliance on forward-looking statements. We undertake no duty toupdate our forward-looking statements, including our earnings outlook, which are made as of the date of this presentation.

Non-GAAP Financial MeasuresThis presentation contains non-GAAP financial measures such as adjusted net income and diluted earnings per share from continuing operations, adjusted SG&Aas a percentage of revenues and gross profit, adjusted operating margin, adjusted operating profit as a percentage of gross profit, and adjusted pre-tax margin. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not comparable to similarly titled measures used by other companies.As a result, we review any non-GAAP financial measures in connection with a review of the most directly comparable measures calculated in accordance withGAAP. We caution you not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. Wepresent cash flows from operations in the attached tables, adjusted to include the change in non-trade floor plan debt to improve the visibility of cash flows related tovehicle financing. As required by SEC rules, we have reconciled these measures to the most directly comparable GAAP measures in the attachments to this release.We believe the non-GAAP financial measures we present improve the transparency of our disclosures; provide a meaningful presentation of our results from corebusiness operations, because they exclude items not related to core business operations and other non-cash items; and improve the period-to-period comparabilityof our results from core business operations. These presentations should not be considered an alternative to GAAP measures.


LITHIA MOTORS OVERVIEWNationwide Geographic Footprint

Two growth paths: exclusive markets for Lithia, metro markets for DCH

Performance-based entrepreneurial culture


LITHIA MOTORS OVERVIEW129 Dealerships in the United States

NATIONAL MARKET SHARE LITHIA NEW VEHICLE UNIT MIX

Import 47% 58%

Honda 23%

Toyota 19%

Subaru 6%

Nissan 3%

Other Import 7%*

Domestic 46% 33%Chrysler 19%

GM 10%

Ford 4%

Luxury 7% 10%

BMW 6%

Mercedes 2%

Lexus 1%

Other Luxury 1%Note: Quarter-to-date national market share for June 2015 from the “Auto Unit Sales & SAAR” report published by Stephens Inc.; Lithia market share based on new vehicle unit sales for the three months ended June 30, 2015.

* Other import includes Hyundai, Volkswagen, Kia, Mazda and Mitsubishi

** Other luxury includes Porsche and Volvo


CORNERSTONES OF SUCCESS

OPERATIONAL GROWTH

New vehicle recovery continues

Used market 3x bigger than new market

Service work driven by SAAR recovery

ACQUISITIONOPPORTUNITIES

Unconsolidated industry

Target 20% after tax ROE per year

FINANCAL DISCIPLINE

Balance investment and shareholder return

Ample liquidity to deploy

Path to $7.00 Earnings Per Share

OPERATIONALGROWTH


GROWTH MILESTONES

Achieved with organic growth and acquisitions

Completed second Milestone in 2014

Target completing Milestones in 2-6 years

Delivers $7.00 Earnings Per Share

ADJUSTED EARNINGS PER SHARE

Milestone 1$4.00

Milestone 2$5.00

Milestone 3$6.00

$2.72$4.02

$5.11$6.72

$2.00 $3.00 $4.00 $5.00 $6.00 $7.00

FY 2014

FY 2013

Note: See appendix for reconciliation of adjusted earnings per share.

Milestone 1$3.9

Milestone 2$4.4

Milestone 3$4.6

Milestone 1$0.1

Milestone 2$1.0

Milestone 3$2.7

FY 2014

FY 2013

2012 Base

2012 Base

2012 Base

ORGANIC REVENUE GROWTH ($B)

ACQUISITION REVENUE GROWTH ($B)

Milestone 4$7.00

FCST 2015

Milestone 4$5.0

FCST 2015

Milestone 4$3.5

FY 2014

FY 2013

FCST 2015

$3.4

$3.8

$4.5

$4.8

$3.0 $3.5 $4.0 $4.5 $5.0

$0.2$0.9

$3.0

$0.0 $1.0 $2.0 $3.0

OPERATIONALGROWTH


STABLE, PROFITABLE INDUSTRYFour Separate Diversified Businesses

Note: Margin based on reported adjusted pre-tax income as a percentage of revenue. Peer group average includes Lithia, AutoNation, Sonic, Asbury, Penske, and Group 1.

Recession-tested

Variable cost structure

Diverse and complimentary gross profit mix

Service business consistent

Note: Used vehicles includes both used retail and wholesale vehicles.

YTD 2015 Revenue Mix

YTD 2015 Gross Profit Mix

New vehicles 57% 23%

Used vehicles 29% 21%

Service, body and parts 9% 32%

F&I and other 5% 24%

PROFITABILITY MIX

PROFITABILITY AND SAAR

2.0% 1.9% 1.5% 2.1% 2.5% 2.6% 2.8% 3.0%

-3%

-18%-21%

11% 11%13%

7% 6%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

2007 2008 2009 2010 2011 2012 2013 2014

Peer Group PTI% SAAR Growth Rate

5%18%

-1%

40% 38%

16%7%

25%

-6% -1%

58%

4% 8% 13%

CA NY/NJ OR TX MT AK WA IA NV ID ND HI NM Total

% C

hang

e in

Veh

icle

R

egis

trat

ions

201

5 vs

. 200

6


NEW VEHICLE MARKETOpportunities Remain Despite Recovery

After recessionary periods, SAAR performed above the long-run average

Western market registrations still trending below the national average

LITHIA NEW VEHICLE MARKET POTENTIAL

HISTORICAL NEW VEHICLE SAAR PERFORMANCE

Source: US Department of Commerce, Bureau of Economic Analysis, data as of December 23, 2013

10.0

15.0

20.0

1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Recovery spikes above long-run average

% of Q2 2015 Rev 21% 18% 16% 16% 6% 6% 5% 3% 3% 1% 1% 1%3% 100%


USED VEHICLE MARKETLargest Future Opportunity

Used vehicle market 3x larger than new

Franchised dealers 37% of used vehicle market

70% of 2014 used retail sales originate from new vehicle sale

13.210.4 11.6 12.7 14.4

36.5 35.5 36.9 38.8 40.5

2008 2009 2010 2011 2012

Ret

ail U

nits

sol

d (in

Mill

ions

)

New UsedSource: WardsAuto Group “U.S. Market Used Vehicle Sales“ report

USED MARKET SIZE USED MARKET SHARECarMax,

1%

Private Party, 28%

Independent Dealers, 34%

Franchised Dealers,

37%

Source: 2012 data from WardsAuto Group “U.S. Market Used Vehicle Sales“ report

2.7x 3.4x 3.2x 3.1x 2.8x

LITHIA USED WATERFALL

In Units Retail Sale Retailed Trade-ins% Sold w/

Retailed Trade

2014 New Vehicles 72,177 28,609 40%

1st Trade-in Retailed 28,609 10,685 11%

2nd Trade-in Retailed 10,685 3,571 2%

3rd Trade-in Retailed 3,571 1,112 1%

Aggregate Retailed Trades 42,865

2014 Used Retail Sales 61,561

70%


USED VEHICLE GROWTH

Achieving 75 unit goal increases unit sales 27%

72% of stores sell less than 75 unit goal

Target 75 Used Units Per Store Per Month

14

4435

26

10

<=25 26-50 51-75 76-100 100+Store Distribution of Average Used Retail Units Sold per Month

2015 AVERAGE USED RETAIL UNITS SOLD PER MONTH

Average:59 units

YTD 2015 SAME STORE USED UNIT MIX YTD 2015 USED MIX DETAILS

Core, 51%Value

Auto, 29%

CPO, 20%

CPO: Manufacturer certified pre-owned vehiclesCore: 3 to 7 year old vehiclesValue Auto: Vehicles over 80,000 miles

19%

14%

7%

Same Store Revenue Growth

CPO Core Value Auto

Goal:75 units


VEHICLE SALES GROWTH

F&I per unit $143 lower than peer average

F&I products increase service retention

Total gross profit per unit of $3,679 up $18 from 2014

Opportunity Exists in F&I

Note: Peer average includes AutoNation, Sonic, Asbury, Penske, and Group 1.

F&I PENETRATION RATES

Note: Penetration rates are on a same store basis

$1,178

$1,321

Lithia Peer Average

Q1 2015 F&I PER UNIT

42%

42%

45%

Service Contracts

2013 2014 YTD 2015

36% 37

%

37%

Lifetime Oil Contracts

YTD 2015 VEHICLE SALES SAME STORE DETAILS

Revenue Growth

Unit Growth

Gross Profit

GrowthGP per

Retail Unit

GP per Retail Unit

Change

New 9% 7% 2% $2,143 ($110)

Used retail 14% 9% 10% $2,652 $23

F&I 14% NA 14% $1,258 $66

Total vehicle* 11% 8% 9% $3,679 $18

* Total vehicle metrics include sales and gross profit for new, used retail, used wholesale and F&I and new and used retail units


SERVICE MARKETTailwind as Units in Operation Expand

74,825 74,668 75,025 76,220 79,14985,431

95,080

111,127

-4.3%

0.7%

4.5%6.5% 6.7%

11.3%9.0%

-10%

-5%

0%

5%

10%

50,000

60,000

70,000

80,000

90,000

100,000

110,000

120,000

130,000

2009 2010 2011 2012 2013 2014 2015E 2016E10-year Avg UIO SB&P Y-o-Y SS Sales Growth*

Service growth correlated with SAAR growth

Increasing service work as installed units grow

LITHIA MARKET UIO OPPORTUNITY

TRAILING SAAR/SERVICE GROWTH

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011

Trailing 5-year SAAR Growth Trailing 3-year Industry SB&P Growth

*Forecasted same store service, body and parts growth for FY 2015

$76 $139 $126 $105 $87 $76 $62Avg GP

Across AllUnits Sold


SERVICE GROWTHImproving Retention Increases Service Revenue

Average 44% new and 26% used retention in service over 7 years

Across all vehicles sold, cumulative service GP per unit is $671

Ex defections, cumulative GP per unit is $1,953

CUMULATIVE SERVICE GROSS PROFIT PER VEHICLE

% OF VEHICLES SOLD RETURNING FOR SERVICE

46%

65%56%

45%36%

31%24%

33%39%

31%25%

20% 17% 14%

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7

% New Vehicle

% Used Vehicle

Total$671

$193 $264 $282 $295 $303 $308 $309Avg GPper Sold

UnitsRetained

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7

Total$1,953


SERVICE GROWTHRetaining Customers Longer

Service revenue increasing due to more units in operation

Average age of vehicles serviced increased 1.3 years since 2008

SAME STORE SALES YEAR-OVER-YEAR COMPARISON

2010 2011 2012 2013 2014 YTD 2015

Customer Pay 4.8% 3.9% 6.9% 5.2% 9.1% 8.1%

Warranty (8.5)% (4.2)% (2.7)% 13.9% 23.4% 28.9%

Wholesale Parts (0.6)% 9.8% 8.7% 7.2% 8.0% 4.8%

Body Shop (2.2)% 14.0% 15.1% 3.8% 10.5% (0.7)%

Total 0.7% 4.5% 6.5% 6.7% 11.4% 10.3%

AVERAGE AGE OF VEHICLES SERVICED

Avg # of Veh Srv per month 0-1 Yrs 2-3 Yrs 4-5 Yrs 6-7 Yrs 8-9 Yrs 10+ Yrs

2011 64,467 21% 21% 23% 15% 9% 11%

2012 65,507 24% 16% 21% 16% 10% 13%

2013 69,399 26% 18% 15% 16% 11% 14%

2014 75,332 27% 21% 12% 14% 11% 15%

Serv

iced

Ve

hicl

e M

ix

4.0 4.4 4.5 4.8 4.9 4.9 4.9 5.3

2008 2009 2010 2011 2012 2013 2014 YTD 2015


LEVERAGING COST STRUCTURE

Throughput is incremental % of gross profit to operating income after SG&A expenses

2014 and 2015 SG&A as a % of gross profit impacted by DCH acquisition

Target Throughput of 45% to 50% on a Same Store BasisADJUSTED SG&A AS A % OF GROSS PROFIT

$MM YTD 2014 % of GP YTD 2015 % of GP $ ChangePersonnel $166 45.6 $267 46.8 $101Advertising 20 5.5 32 5.6 12Rent 7 2.0 11 2.0 4Facility Cost 15 4.1 23 4.0 8Other 35 9.5 60 10.4 25Total $243 66.7 $393 68.8 $150

Gross Profit $364 $571 $207YTD throughput % 27%

YTD same store throughput % 36%

ADJUSTED SG&A DETAILS

69.4%

67.2% 67.7%68.8%

2012 2013 2014 YTD 2015

51% 51% 43%

36%

2012 2013 2014 YTD 2015

Target 45-50%

SAME STORE THROUGHPUT

Note: See appendix for reconciliation of adjusted SG&A expense

ACQUISITION OPPORTUNITIES


UNCONSOLIDATED INDUSTRY

Over 17,800 dealerships in the country

10 largest dealers own 1,300 stores

Abundant Acquisition Opportunities

DEALERSHIPS IN THE US

HIGHLY FRAGMENTED MARKET

21,761 21,461 20,453

18,607 17,653 17,767 17,851 17,838

2007 2008 2009 2010 2011 2012 2013 2014

Source: Automotive News, number of Light Vehicle Dealerships in the U.S.

Top 10 Dealers

7%

All Other 93%

Source: Automotive News 2014 Top 150 Dealership Groups


FUTURE GROWTH STRATEGYTwo Growth Paths, Over Double the Acquisition Targets

Micro Small Medium Large Extra Large Mega

Vehicle Registrations in Market 0-5K 5K-25K 25K-50K 50K-100K 100K-200K 200K+

Est. Store Count in US 3,950 3.500 1,600 1,700 2,400 4,650

Domestic

Import

Luxury

Est. Acq Targets 210 680 310 30 470 960

1,230 1,430

Lithia: exclusive franchises in medium markets for domestic/import stores and large markets for luxury stores

DCH: extra large and mega markets to cluster domestic, import and luxury stores


ACQUISITION GROWTH

75-100% 5-year after tax ROE

3x-5x EV/EBITDA

10%-20% of annual revenues

Targeting 20% After Tax Return on Equity

ACCUMULATED RETURN ON EQUITY

INVESTMENT METRICS

Improve performance through common systems and measurements

*Equity defined as investment costs, excluding new vehicles and assuming all real estate is leased at actual rent or if owned, a 7% capitalization rate**Assumes steady state revenues 2 years after acquisition, EBITDA adjusted to include flooring interest as an operating expense

2010 2011 2012 2013 2014

$MM Multiple $MM Multiple $MM Multiple $MM Multiple $MM Multiple

# of Store 3 5 6 8 36

Equity* $10 $41 $26 $33 $305

Est. EBITDA** $3 3.3x $12 3.4x $8 3.3x $9 3.7x $69 4.7x

Est. Rev** $62 16% $250 16% $265 10% $273 12% $2,715 12%

2010 2011 2012 2013 2014

Year 5

Year 4

Year 3

Year 2

Year 1

Acq Year

170% 162%

64%

23%

ACQUISITION METRICS

Note: Return based on net income assuming all real estate is leased at actual rent or, if owned, at 7% capitalization rate. Years are based on calendar years. Acquisition year reflects partial year results from acquisition date forward and most recent period results are year-to-date through June 30, 2015

10%

FINANCIAL DISCIPLINE


FINANCIAL DISCIPLINE

Leverage increased in 2014 due to DCH acquisition

Ample liquidity levels with no near term debt maturities

Positioned for Continued Growth

FUNDS FOR GROWTH

$MM Q2 2015

Cash and Cash Equivalents $23

Availability on Line of Credit 168

Unfinanced Real Estate* 117

Total $308

BALANCE SHEET LEVERAGE

$12 $24 $23$35 $27 $30

$227

2015 2016 2017 2018 2019 2020 2021 Beyond

FUTURE MORTGAGE MATURITIES

44% 41% 32% 49% 46%

2.5x

1.9x

1.3x

2.5x

1.9x

0.0

0.5

1.0

1.5

2.0

2.5

3.0

2011 2012 2013 2014 201525.0%

35.0%

45.0%

55.0%

65.0%

Deb

t / A

djus

ted

EBIT

DA

Deb

t to

Tota

l Cap

ital

*Unfinanced real estate represents 80% of the net book value of unfinanced real estate used in operations.

Note: Total capital includes outstanding debt excluding vehicle floor plan financing and total shareholder’s equity. Adjusted EBITDA is defined as earnings before interest excluding floor plan interest, taxes, depreciation and amortization. Debt to adjusted EBITDA calculation is based on outstanding debt as of the end of the period and TTM adjusted EBITDA

Note: Outstanding mortgage amounts as of March 31, 2015


FINANCIAL DISCIPLINEBalance Investment and Shareholder Return

CAPITAL EXPENDITURES

DIVIDENDS PAID

$39 $28 $34

$130$87

$10$41 $26 $33

$305

2010 2011 2012 2013 2014

Free Cash Flow** Acquisition Equity Value

FREE CASH FLOW AND ACQUISITIONS

SHARE REPURCHASES

$4 $7 $10 $13 $16

$0.15

$0.26

$0.37

$0.49*

$0.61

$0.00

$0.25

$0.50

$0.75

2010 2011 2012 2013 2014 $-

$5.0

$10.0

$15.0

$20.0$

per S

hare

$MM

Dividends Paid Dividend per Share

$21 $5 $16 $10

$24.41

$40.76

$70.52

$100.29

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

2012 2013 2014 2015 $-

$5.0

$10.0

$15.0

$20.0

$25.0

$ pe

r Sha

re

$MM

Share Repurchases Price per Share

$MM 2012 2013 2014 FCST 2015

Post-Acq. Improv. $7 $12 $21 $28

Facilities for Open Points 10 5 7 3

Lease Buy-outs 20 7 25 28

Existing Facility Improv. 21 14 20 22

Maintenance 7 12 13 19

Total $65 $50 $86 $100

# of Shares 848,092 127,900 226,729*Q4’12 dividend was accelerated and paid in December 2012 rather in 2013. Data has been normalized to include the $0.10 dividend in 2013

**Free cash flow defined as earnings before interest, taxes, depreciation and amortization (EBITDA) add back stock compensation less cash paid for taxes, interest, dividends and capital expenditures.

98,947

Q2 2015 UPDATE


Q2’15 FINANCIAL RESULTS

Increased revenue 63% and EPS 39%

Grew total same store sales 11%

Revenue Gross Profit

New vehicles 8% -

Used retail vehicles 16% 10%

F&I 15% 15%

Service, parts and body 10% 10%

Total 11% 9%

SAME STORE QUARTER-OVER-QUARTER GROWTH

Q2 2015 HIGHLIGHTS

$1,222

$1,997

Q2 2014 Q2 2015

Revenue ($MM)

$1.34

$1.86

Q2 2014 Q2 2015

Adjusted Diluted EPS

$192

$298

Q2 2014 Q2 2015

Gross Profit ($MM)

55% 39%63%

Note: See appendix for reconciliation of adjusted diluted EPS

Income Statement Summary


Q2’15 FINANCIAL RESULTS

SAME STORE GROSS PROFIT GROWTH

SAME STORE SALES GROWTH

ADJUSTED NET PROFIT MARGIN

ADJUSTED SG&A AS A % OF GROSS PROFIT

2.5% 2.4%

1.0%

Lithia Asbury Sonic AutoNation Penske Group1Note: See appendix for reconciliation of adjusted net profit margin

LAD ABG AN GPI PAG SAH

New Vehicles 7.7% 5.2% 2.4%

Used Vehicles 16.3% 7.9% 8.9%

F&I 15.3% 7.7% 8.5%

SB&P 9.6% 8.0% 7.0%

Total 11.0% 6.1% 4.7%

65.2% 68.3%

78.8%

66.6% 67.0%

80.5%

Lithia Asbury Sonic AutoNation Group1 Penske

Q2 2014 Q2 2015

bps reduction(increase)

130 (170) xx(140)

Note: See appendix for reconciliation of adjusted SG&A

Peer Comparisons

xx xx

8.6%

4.1% 4.0%

Lithia Sonic Asbury AutoNation Penske Group1


2015 GUIDANCE

Q3’15: $1.83 - $1.87FY’15: $6.63 - $6.72

PROJECTED EARNINGS RANGE*:

2015 PERFORMANCE ASSUMPTIONS:

*Excludes the impact of future acquisitions, dispositions and any potential non‐core items

Continuing Operations Same Store

Total Revenues $7.6 to $7.8 billion $5.7 to $5.9 billion

New vehicle sales increase 45.0% 7.0%

Used vehicle sales increase 40.0% 12.0%

Service body and parts sales increase 42.0% 8.5%

Finance and insurance per unit $1,200 per unit $1,250 per unit

New vehicle margins 5.9% to 6.1%

Used vehicle margins 12.6% to 12.8%

Service body and parts margins 48.8% to 49.2%

Tax rate 40.0%

Average diluted shares outstanding 26.5 million

APPENDIX


SUPPLEMENTAL INFORMATIONBalance Sheet

$KAs of

June 30, 2015

As of December 31,

2014

Cash and cash equivalents 23,394 29,898

Accounts receivable 287,808 295,379

Inventories, net 1,367,317 1,249,659

Other current assets 32,028 32,010

Assets held for sale - 8,563

Total current assets 1,710,547 1,615,509

Property and equipment, net 836,889 816,745

Goodwill 199,129 199,375

Franchise value 150,856 150,892

Other non-current assets 107,434 98,411

Total assets 3,004,855 2,880,932

$KAs of

June 30, 2015

As of December 31,

2013

Floor plan notes payable 45,464 41,047

Floor plan notes payable: non-trade 1,169,717 1,137,632

Current maturities of long-term debt 37,963 31,912

Trade payables 78,885 70,853

Accrued liabilities 157,579 153,661

Deferred income taxes 3,494 2,603

Liabilities related to assets held for sale - 4,892

Total current liabilities 1,493,102 1,442,600

Long-term debt, less current maturities 599,402 609,066

Deferred revenue 59,893 54,403

Deferred income taxes 36,077 42,795

Other long-term liabilities 64,079 58,963

Total liabilities 2,252,553 2,207,827

Total stockholders’ equity 752,302 673,105

Total liabilities and stockholder’s equity 3,004,855 2,880,932


SUPPLEMENTAL INFORMATION2015 Income Statement

$K Q4 2015 Q3 2015 Q2 2015 Q1 2015 FY 2015

New vehicle 1,149,512 $ 1,007,816 $ 2,157,328 Used vehicle 488,801 462,931 951,732 Wholesale used vehicles 66,796 62,208 129,004Finance and insurance 72,463 64,604 137,067Service, body and parts 182,695 173,475 356,170Fleet and other 36,680 18,144 54,824

Total revenues 1,996,947 1,789,178 3,786,125

New vehicle 69,342 61,774 131,116Used vehicle 62,693 59,442 122,135Wholesale used vehicles 1,406 2,161 3,567Finance and insurance 72,463 64,604 137,067Service, body and parts 90,749 84,439 175,188Fleet and other 996 955 1,951

Total gross profit 297,649 273,375 571,024

Asset impairment charges 6,130 4,130 10,260Selling, general and administrative 195,610 191,618 387,228Depreciation and amortization 10,287 9,726 20,013

Operating Income 85,622 67,901 153,523

Floor plan interest expense 4,655 4,649 9,304Other interest expense 4,972 4,828 9,800Other income, net 356 368 724

Income (loss) before taxes 75,639 58,056 133,695Income tax expense (benefit) 24,416 17,403 41,819

Income (loss) from continuing operations 51,223 40,653 91,876



$K Q4 2014 Q3 2014 Q2 2014 Q1 2014 FY 2014

New vehicle $1,071,543 $732,121 $694,484 $579,522 $3,077,670Used vehicle 409,591 340,522 310,475 301,893 1,362,481Wholesale used vehicles 59,867 48,853 44,286 42,693 195,699Finance and insurance 60,057 46,855 43,838 39,631 190,381Service, body and parts 172,398 120,772 114,337 104,617 512,124Fleet and other 19,851 7,988 14,382 9,750 51,971

Total revenues 1,793,307 1,297,111 1,221,802 1,078,106 5,390,326

New vehicle 65,518 47,648 45,994 39,024 198,184Used vehicle 50,492 43,898 44,067 40,796 179,253Wholesale used vehicles 307 504 1,504 1,331 3,646Finance and insurance 60,057 46,855 43,838 39,631 190,381Service, body and parts 84,301 58,421 56,182 50,832 249,739Fleet and other 446 514 715 447 2,122

Total gross profit 261,121 197,840 192,300 172,061 823,322

Asset impairment charges 1,853 - - - 1,853Selling, general and administrative 184,288 131,627 125,463 121,829 563,207Depreciation and amortization 8,964 6,067 5,825 5,507 26,363

Operating Income 66,016 60,146 61,012 44,725 231,899

Floor plan interest expense 4,535 3,127 3,215 2,984 13,861Other interest expense 4,848 2,051 1,869 1,974 10,742Other income, net (89) (1,027) (1,146) (937) (3,199)

Income (loss) before taxes 56,722 55,995 57,074 40,704 210,495Income tax expense (benefit) 15,583 21,458 21,904 16,010 74,955

Income (loss) from continuing operations 41,139 34,537 35,170 24,694 135,540



$K Q4 2013 Q3 2013 Q2 2013 Q1 2013 FY 2013

New vehicle $589,535 $604,135 $569,487 $493,441 $2,256,598Used vehicle 253,797 280,734 258,465 239,228 1,032,224 Wholesale used vehicles 37,642 43,396 37,691 39,506 158,235 Finance and insurance 35,994 37,132 34,218 31,663 139,007 Service, body and parts 100,797 97,784 94,462 90,440 383,483 Fleet and other 7,109 6,109 14,182 8,802 36,202

Total revenues 1,024,874 1,069,290 1,008,505 903,080 4,005,749

New vehicle 39,097 38,586 38,788 34,647 151,118 Used vehicle 35,351 41,641 38,893 34,973 150,858 Wholesale used vehicles 332 710 695 974 2,711 Finance and insurance 35,994 37,132 34,218 31,663 139,007 Service, body and parts 48,107 46,991 46,693 43,779 185,570 Fleet and other 412 329 546 402 1,689

Total gross profit 159,293 165,389 159,833 146,438 630,953

Selling, general and administrative 108,416 108,570 109,283 101,131 427,400 Depreciation and amortization 5,316 5,099 4,899 4,721 20,035

Operating Income 45,561 51,720 45,651 40,586 183,518

Floor plan interest expense 2,979 2,909 3,036 3,449 12,373 Other interest expense 2,115 1,933 1,941 2,361 8,350 Other income, net (773) (835) (584) (801) (2,993)

Income (loss) before taxes 41,240 47,713 41,258 35,577 165,788 Income tax expense (benefit) 14,080 16,822 15,977 13,695 60,574

Income (loss) from continuing operations 27,160 30,891 25,281 21,882 105,214


SUPPLEMENTAL INFORMATIONQuarterly Same Store Revenue Changes

Q4 Q3 Q2 Q1 FY

2015New vehicle 7.7% 11.5% 9.4%Used vehicle 16.3% 11.7% 14.0%Wholesale used vehicles 11.6% 5.8% 8.8%Finance and insurance 15.3% 12.6% 14.0%Service, body and parts 9.6% 11.1% 10.3%Fleet and other 53.3% 26.2% 42.3%

Total revenues 11.0% 11.5% 11.2%

2014New vehicle 12.3% 11.1% 12.1% 10.2% 11.5%Used vehicle 16.7% 13.8% 11.4% 19.3% 15.2%Wholesale used vehicles 15.0% 6.9% 11.2% 4.3% 9.2%Finance and insurance 14.5% 16.6% 17.5% 18.0% 16.6%Service, body and parts 12.5% 13.1% 10.4% 9.4% 11.4%Fleet and other 86.3% 2.2% -10.7% 10.8% 15.7%

Total revenues 14.1% 12.0% 11.6% 12.5% 12.5%

2013New vehicle 10.7% 15.6% 18.5% 21.8% 16.4%Used vehicle 16.0% 16.6% 18.5% 22.0% 18.3%Wholesale used vehicles 2.7% 18.1% 1.5% 12.5% 8.6%Finance and insurance 17.7% 14.6% 20.1% 24.3% 18.9%Service, body and parts 7.9% 5.6% 7.1% 6.6% 6.8%Fleet and other -4.7% 34.3% 25.3% -31.8% 0.0%

Total revenues 11.6% 15.0% 16.7% 18.8% 15.3%


SUPPLEMENTAL INFORMATIONQuarterly Gross Margins

Q4 Q3 Q2 Q1 FY

2015New vehicle 6.0% 6.1% 6.1%Used vehicle 12.8% 12.8% 12.8%Wholesale used vehicles 2.1% 3.5% 2.8%Finance and insurance 100.0% 100.0% 100.0%Service, body and parts 49.7% 48.7% 49.2%Fleet and other 2.7% 5.3% 3.6%

Total revenues 14.9% 15.3% 15.1%

2014New vehicle 6.1% 6.5% 6.6% 6.7% 6.4%Used vehicle 12.3% 12.9% 14.2% 13.5% 13.2%Wholesale used vehicles 0.5% 1.0% 3.4% 3.1% 1.9%Finance and insurance 100.0% 100.0% 100.0% 100.0% 100.0%Service, body and parts 48.9% 48.4% 49.1% 48.6% 48.8%Fleet and other 2.2% 6.4% 5.0% 4.6% 4.1%

Total revenues 15.5% 15.5% 15.8% 16.2% 15.8%

2013New vehicle 6.6% 6.4% 6.8% 7.0% 6.7%Used vehicle 13.9% 14.8% 15.0% 14.6% 14.6%Wholesale used vehicles 0.9% 1.6% 1.8% 2.5% 1.7%Finance and insurance 100.0% 100.0% 100.0% 100.0% 100.0%Service, body and parts 47.7% 48.1% 49.4% 48.4% 48.4%Fleet and other 5.8% 5.4% 3.8% 4.6% 4.7%

Total revenues 15.5% 15.5% 15.8% 16.2% 15.8%


SUPPLEMENTAL INFORMATION2015 Adjusted Income Statement Details

YTD 6/30/2015 Gain on sale of stores Asset

impairment Equity Investment YTD 6/30/2015

$K As Reported Q1 Q2 Q2 Q1 Q2 Adjusted

Asset impairments $10,260 - - (2,000) (4,130) (4,130) -

Selling, general and administrative $387,228 3,349 2,570 - - - $393,147

Income from operations $153,523 (3,349) (2,570) 2,000 4,130 8,260 $157,864

Other income (724) - - - 1,732 1,733 $2,741

Income from continuing operations before income taxes $133,695 (3,349) (2,570) 2,000 5,862 5,863 $141,501

Income taxes ($41,819) 1,004 1,305 (780) (7,250) (7,652) (55,192)

Net income from continuing operations $91,876 (2,345) (1,265) 1,220 (1,388) (1,789) $86,309

Diluted earnings per share from continuing operations $3.47 (0.09) (0.05) 0.05 (0.05) (0.07) $3.26

Diluted share count 26,509



YTD 12/31/2014

Disposal Gain

Reserve adjustments

Equity Investment Acquisition expenses Tax Attribute YTD

12/31/2014

$KAs

Reported Q2 Q1 Q4 Q2 Q3 Q4 Q2 Q3 Q4 Adjusted

Asset impairments $1,853 - - (1,853) - - - - - - -

Selling, general and administrative $563,207 - (3,931) - (163) (883) (819) - - - $557,411

Income from operations $231,899 - 3,931 1,853 163 883 819 - - - $239,548

Other income 3,199 1,160 $4,359

Income from continuing operations before income taxes $210,495 - 3,931 3,013 163 883 819 - - - $219,304

Income taxes ($74,955) - (1,545) (6,506) (63) (319) (338) (73) (194) (600) (84,593)

Net income from continuing operations $135,540 - 2,386 (3,493) 100 564 481 (73) (194) (600) $134,711

Net income from discontinued operations $3,180 (3,490) - - - - - - - - $(310)

Net income $138,720 (3,490) 2,386 (3,493) 100 564 481 (73) (194) (600) $134,401

Diluted earnings per share from continuing operations $5.14 - 0.09 (0.13) - 0.02 0.02 - (0.01) (0.02) $5.11

Diluted earnings per share from discontinued operations $0.12 (0.13) - - - - - - - - ($0.01)

Diluted earnings per share $5.26 (0.13) 0.09 (0.13) - 0.02 0.02 - (0.01) (0.02) $5.10




YTD 12/31/2013

Disposal gain Reserve adjustments Tax attribute YTD

12/31/2013

$K As Reported Q4 Q2 Q4 Q2 Q3 Q4 Adjusted

Selling, general and administrative $427,400 2,531 (3,812) (2,341) - - - $423,778

Income from operations $183,518 (2,531) 3,812 2,341 - - - $187,140

Income from continuing operations before income taxes $165,788 (2,531) 3,812 2,341 - - - $169,410

Income taxes (60,574) 968 (1,484) (869) (228) (1,284) (1,320) (64,791)

Net income from continuing operations $105,214 (1,563) 2,328 1,472 (228) (1,284) (1,320) $104,619

Net income from discontinued operations 786 - - - - - - 786

Net income $106,000 (1,563) 2,328 1,472 (228) (1,284) (1,320) $105,405

Diluted earnings per share from continuing operations $4.02 (0.06) 0.09 0.05 (0.01) (0.05) (0.05) $3.99

Diluted earnings per share from discontinued operations 0.03 - - - - - - 0.03

Diluted earnings per share $4.05 (0.06) 0.09 0.05 (0.01) (0.05) (0.05) $4.02


Q2’15 COMPANY UPDATE - Lithia Investor RelationsNon-GAAP Financial Measures This presentation...

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