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Lithia again grows rapidly Acquisitions help profits boom By DAVID PRESZLER Fueled by the acquisition of 10 new dealerships, Lithia Motors Inc. continued to grow rapidly in 1998. Sales for the Medford-based auto dealership rose 123 percent for the year, and profits were up 80 percent from 1997, to $10.79 million, according to earnings reports released Wednesday. The company's fourth-quarter earnings also showed strong growth, with sales up 76 percent and profits up 81 percent. "We are pleased to announce these results, which exceed even the most aggressive estimates that Wall Street had set for us for both the year and the quarter," said Sid DeBoer, company chairman and chief executive officer. The strong earnings didn't prevent the company's stock, which trades as LAD on the New York Stock Exchange, from dropping to 18 at Wednesday's close. The number of new and used cars the company sold in 1998 more than doubled from 1997 levels, rising from 19,631 to 40,885. The company's total sales for the year were $714.7 million, up from $319 million in 1997. New vehicle sales accounted for $388.4 million in 1998, up from $161.3 million in 1997. Used vehicle sales for 1998 were $220.5 million, up from $113 million. Annual dividends were $1.14 per share in 1998, up from 82 cents a share in 1997. Dividends for the fourth quarter were 32 cents per share, up from 25 cents a share in 1997. The bulk of the growth was fueled by the company's aggressive acquisitions. Lithia Motors purchased 10 new dealerships during 1998. Since going public in late 1996, the company has grown from five dealerships to 28, and officials say they have no intention of slowing down. The company has secured $75 million in acquisition credit. "We haven't touched that acquisition credit line," said company spokesman Jeff DeBoer. "That would be enough to allow us to grow three times as big as we are now, and we can see that happening in the next three to five years." The company has a number of properties in its "acquisition pipeline," meaning it is in serious discussions with owners. While the new acquisitions account for much of the growth, the company's same-store sales were up 14.7 percent in 1998 -- a level that Sid DeBoer points out is the highest in its sector and well above the national average of 2.9 percent. DeBoer said sales at Lithia's Rogue Valley dealerships were up 6.5 to 7 percent. Today's Business Index Mail Tribune Copyright � The Mail Tribune 1999, Medford, Oregon USA