Penske profits soar

Penske Automotive Group, the car and commercial-vehicle empire founded and run by US entrepreneur and former car racing champion, Roger Penske (pictured), experienced strong sales and soaring revenues in 2014.

According to the group's latest financial report, revenue increased by 18.9 per cent to $US17.2 billion ($A22.3 billion), while adjusted income from continuing operations also increased by 18.9 per cent, to $US295.7 million ($A384 million). Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 18.7 per cent to $US568.8 million ($A738 million).

The company reports that the bulk of the increase in revenue was driven by an 11.0 per cent rise in total retail sales.

The growth was partially limited, however, by Penske's Australian operations. Penske Commercial Vehicles experienced a difficult first full year, with registrations of new Western Star, MAN and Dennis Eagle trucks contracting by 30.7%, 29.7% and 39.3% respectively (TIC T-Mark data), while the acquisition by Penske Automotive Group of MTU Detroit Diesel Australia late last year incurred further costs.

Speaking with regard to the group's strong fourth-quarter results, Roger Penske said the sluggish Australian truck market had made an impact.

"Strong results across the retail automotive dealership business and our US-based commercial vehicle dealership business were partially offset by our Australian operations, which were impacted by challenging economic conditions and post-acquisition restructuring costs within the Power Systems business," he said in a media statement.

In general, however, business for Penske is booming – and expanding. Last year saw Penske Automotive Group acquire over $US1 billion ($A1.3 billion) in annualised revenues, with $US225 million ($A292 million) stemming from retail automotive, $US600-700 million ($A778-908 million) from commercial vehicle dealerships, and $US200-225 million ($A259-292 million) from commercial vehicle distribution.

Roger Penske said the group was performing strongly.

"We completed the most profitable year in the history of our company, generated another year of strong cash flow and solidified our balance sheet," he said.

"The retail automotive and commercial truck markets remain robust and we remain optimistic about the future growth and profitability opportunities for our company."