Competitive Pressures Squeeze Car-Mart’s Profits

Earlier this fiscal year, Bentonville-based America’s Car-Mart warned that “competitive pressures” could squeeze profitability. That prediction came true, but the Bentonville-based used car dealership still scored a solid quarter and strong fiscal year.

“Increased funding to the sub-prime auto industry has certainly contributed to some additional competitive pressure this year. We have answered the challenge, and our general managers have remained focused on earning repeat business and highlighting the value of Car-Mart’s local presence and face to face relationships giving us the ability to work with customers most effectively,” said William H. (“Hank”) Henderson, President and CEO of America’s Car-Mart.

America’s Car-Mart reported net income of $8.79 million on revenue of $125.54 million. One year ago, the “buy here, pay here” used car chain posted profits of $9.64 million on revenue of $113.48 million.

For the full fiscal year, Car-Mart closed out with a $32.16 million profit on revenue of $464.68 million. In the previous fiscal year, the company posted net income elf $32.99 million on sales and revenue of $430.18 million.

Car-Mart opened 10 new dealerships in the last fiscal year, including four in the fourth quarter.

“We have several great new locations in process and our expectation continues to be that we will open new dealerships in fiscal 2014 and beyond at an approximate 10% annual rate,” said Henderson.