Automotive and KAR Auction Services and Transportation, Distribution & Logistics and Distribution & Logistics

KAR Auctions reports $14M quarterly loss

August 9, 2011

Used and salvaged vehicle auctioneer KAR Auction Services Inc. said it lost $14.3 million in the second quarter due to the early payoff of debt.

The loss, of 11 cents per share, compared with a profit of $28.6 million, or 21 cents per share, in the April-June period a year ago.

Carmel-based KAR announced in May that it redeemed $450 million worth of notes using a new $1.7 billion, six-year term loan and a $250 million five-year revolving credit facility. Without the costs of premiums to redeem those notes and other charges, KAR said it would have made 32 cents per share, which was in line with Wall Street's estimates.

KAR said revenue was flat at $470.6 million. Analysts polled by FactSet expected revenue of $488 million.

KAR said it adjusted net income of $1.20 to $1.25 per share for the year. Analysts are forecasting $1.22 on that basis.

The company said it expects used car volumes to remain tight through the rest of the year thanks to the auto industry's sharp downturn three years ago.

Shares slipped 29 cents, or 1.8 percent, to $16.41 in extended trading following the release of the earnings report. They finished the regular session up 4 percent, or 70 cents, at $16.70 amid a broad rally on Wall Street.

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