FORT LAUDERDALE, Fla., Mar 3, 2003 /PRNewswire-FirstCall via COMTEX/ --
AutoNation, Inc. (NYSE: AN), America's largest retailer of both new and used
vehicles, announced today that it has reached a settlement with the Internal
Revenue Service ("IRS") with respect to the tax treatment of certain
transactions entered into by the Company in 1997 and 1999.
The Company will owe the IRS net aggregate payments of approximately $470
million, including interest. An initial net payment of approximately $350
million will be due in March 2004, and three subsequent payments of
approximately $40 million each will be due in March 2005, 2006 and 2007,
respectively. As a result of the settlement, the Company expects that in the
first quarter of 2003 it will record additional net income in the range of $100
million to $175 million. Additional details regarding the settlement's financial
impact will be provided with the Company's first quarter 2003 earnings release
in April 2003.
"This settlement eliminates the uncertainty associated with the tax consequences
of these transactions, and that's good news for AutoNation and its
shareholders," said Craig T. Monaghan, Senior Vice President and Chief Financial
Officer of AutoNation. "Our strong cash flow generation, together with our
available cash and credit capacity, positions us well to fund the tax settlement
while continuing to pursue stock repurchases, acquisitions and other
opportunities."
About AutoNation, Inc.
AutoNation, Inc., headquartered in Fort Lauderdale, Fla., is America's largest
retailer of both new and used vehicles and a member of the S&P 500. Ranked #101
on the 2002 Fortune 500 survey of America's largest corporations, AutoNation
employs approximately 28,500 people and owns and operates 375 automotive retail
franchises in 17 states. For additional information, please visit
www.AutoNation.com, where consumers can find more than 93,000 vehicles available
for sale, or visit http://corp.AutoNation.com.
FORWARD-LOOKING STATEMENTS
Certain statements and information included in this release constitute
"forward-looking statements" within the meaning of the Federal Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed or
implied in such forward-looking statements. Additional discussion of factors
that could cause actual results to differ materially from management's
projections, estimates and expectations is contained in the Company's SEC
filings. The Company undertakes no duty to update its forward- looking
statements, including its earnings outlook.
SOURCE AutoNation, Inc.
CONTACT: Oscar Suris of AutoNation, Inc., +1-954-769-3576, or
suriso@autonation.com
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