Good afternoon, ladies and gentlemen. Welcome to the Penske Automotive Group First Quarter 2013 Earnings Conference Call. Today's call is being recorded and will be available for replay approximately 1 hour after completion through May 6, 2013 on the company's website under the Investor Relations tab at www.penskeautomotive.com. I'll now introduce Mr. Tony Pordon, the company's Executive Vice President of Investor Relations and Corporate Development. Please go ahead.

Hey, John, thank you, and good afternoon, everyone. A press release detailing Penske Automotive Group's first quarter 2013 results was issued this morning and is posted on our website, along with the presentation designed to assist you in understanding our financial results. Joining me for today's call are Roger Penske, our Chairman; David Jones, our Chief Financial Officer; and J.D. Carlson, our Controller. On this call, we will be discussing certain non-GAAP financial measures, such as EBITDA. We have reconciled these items to the most directly comparable GAAP measures in this morning's press release, which is, again, available on our website. Also, we may make forward looking statements on this call. Our actual results may vary because of risks and uncertainties, which may cause the actual results to differ materially from expectations. Additional discussion and factors that could cause results to differ materially are contained in our public SEC filings, including our Form 10-K. I'll now turn the call over to Roger Penske, who will take you through our results.

Thank you, Tony. Good afternoon, everyone, and thank you for joining us today. Penske Automotive Group reported record results today. I'm pleased to report that our first quarter produced the highest income and earnings per share in our company's history. The record results were driven by a 9.9% increase in total retail unit sales and a 7.7% increase in total revenue to $3.4 billion, with each area of our business producing solid performance in the first quarter. Income from operations increased 13.9% to $56.9 million and earnings per share increased 14.5% to $0.63. We generated $111.8 million in EBITDA in the first quarter, an increase of 9.5%, and we repurchased 410,000 shares during the quarter. Let's now turn to the specifics of our first quarter. Total retail unit sales increased 9.9% to 85,800 units, and total revenues increased 7.7% to $3.4 billion. On a same-store basis, retail revenues increased 7.4%, including an 11.5% increase in the U.S. and 1.2% internationally. Foreign exchange rates negatively affected our same store performance in Q1 by $25 million or approximately $0.01 per share. Excluding the effect of foreign exchange, same-store retail revenue increased 8.3%, including 3.3% for our international markets. Our total revenue mix during the quarter was U.S., 63%; and international, 37%. Brand revenue mix was consistent with last year. Premium/Luxury at 69%, volume foreign at 27%, and the Big Three at 4%. Looking at new vehicles, we retailed 45,745 units, representing an increase of 9.7%, including 11.8% in the U.S. and 5.3% internationally. Our Premium/Luxury was up 12.4%, volume foreign up 8.1%, the Big Three up 2.4%, for a total of 9.7%. Same-store was up 6.9%, including 9% in the U.S. and 2.5% internationally. Total new vehicle revenue increased 12.9% to $1.7 billion. Our new vehicle average selling price has improved 2.9%…

[Operator Instructions] And first, we'll go to the line of Matt Nemer with Wells Fargo.

So a couple of questions. First, your revenue growth rate guidance is 10% this year. You came in a little below that in the first quarter. Can you just give us a sense for what the acquisition environment looks like out there? And how aggressive do you plan to be this year?

Well, I think, as we look at acquisitions, there's plenty of deals out there. I think, right now, some of them are priced probably higher than we'd expect. And we have a number of transactions in our pipeline. Some of those in the international marketplace, which are more reasonable, and we would expect to see some of those get closed in the next 2 quarters. So I feel comfortable with our target of a 10% growth.

Okay. And then just turning to the Hertz rental car business. Can you give us an update on kind of where that stands and how that ties into your core business? Where should we see that kind of impact that P&L as you get those more integrated into your business?

Well, the current run rate revenue was $7 million in the quarter. We had a loss of $600,000, mostly due to start-up costs. And I think that this gives us some real leverage. When you look at the annualized basis, we'll be about $50 million. And the good news is we'll have somewhere between 5,000 and 6,500 cars in our fleet, ones that have been ordered with specific model and equipment, which are very strong used cars, and they come back in the market, and our expectation is that we'll be taking these cars out and providing them to our key locations 6, 9 and 12 months and maybe some at 15. So as we try to grow this used-to-new ratio, we think is a great strategy. On top of that, this gives us the opportunity to warranty work and also service work at our dealerships associated in those markets along with, obviously, bodywork. So to me, it's -- we can vertically integrate and gives us a chance to touch more customers not only on the service and rental side, but also potentially conquesting some of those on the retail auto side.

And then just lastly on the service business. We've been hearing a lot about kind of pent-up demand, improving units in operation and service based on the SAAR recovery. It looks like your customer pay growth accelerated a little bit. Your warranty business has been stronger over the last 2 quarters than it had been most of last year. Are we starting to see that as this kind of the improving units in operation for your core brands or give us a little commentary on that?

I would definitely feel that we're getting the benefit of the units in operation, as they dipped from 17 million annual SAAR down to 10 million and then back up, so I see a larger carpark of vehicles now in the 1 to 5 years, which, obviously, will drive our customer labor. Also, prepaid maintenance has become a real factor with some of the premium brands offering that to the customers. So we get the benefit of doing that for the customer, and that revenue is generated through the warranty line. So I think that's why you see the warranty going up. I think quality of the vehicles obviously gets better and better and better, but this, obviously, gives us a chance to get more dollars or more share of wallet. We're also, from the standpoint of initiatives, we have gone to dent-less repair, rapid repair. In most of our major locations, we're doing window tinting. We're doing an initiative on alignments. These are things that we really haven't focus on before because we want to see that customers stay with our organization, not move out to the smaller shops that we see in specified areas of exhaust, brakes and tires. We think this is key. And before, we really maybe hadn't focused on those, but with warranty slowing down because of the quality of all our manufacturers, it gives us the chance to build that back. And I think the carpark coming back is key and the good news is, remember, this is over 50% gross margin for us, which will drive more bottom line and cover our fixed expenses.

And next, we'll go to John Murphy with Bank of America Merrill Lynch.

Just maybe to follow up on that line of questioning that Matt was going on with Parts and Service. The 58.4% gross margin was incredibly strong. I was just curious what you're seeing in mix, if we're seeing -- we're hitting these limits in this, I mean, we're getting to all time highs here on these gross margins and they're very impressive. Just curious if there's more room and really what's going on there with these margins where they are.

Well, when you look at mix, about 70% of our Parts and Service business in the first quarter was customer pay and about 22% was warranty and get ready in the body shop was another 7%. So again, we're getting a traditional mix, really, and to me, what's key here is, that we're just trying to get more share of wallet. We have this customer. We're trying to get more hours per RO, and I think efficiency, we're driving efficiency the way we laid out some of our shops. We've got PDI centers now that we put together in Turnersville, in Warwick, Rhode Island, in Santa Ana, also in Round Rock, where we bring these vehicles in and do our reconditioning rather than in each individual dealership. We have PDI centers now, which give us much more efficiency, lower costs. And today, right now, the technicians are making a lot of money in our business. We've got very low turnover of our technicians, so the quality of work is much better.

That's great. And second question, just on the gross margin pressure that we're seeing on new vehicles. Is that something you're seeing across the market? Are the automakers pushing volume and not helping you out as much sort of on the dealer cash? I'm just trying to understand what's going on with the margins there, because we're hearing that from a lot of the mass-market imports.

Well, I think that we had an unusual increase in gross profit last year because there was a shortage of the Japan brands and certainly in Honda and Toyota, and now these volume brands have got more units available and we're seeing some pressure there. That's really driven our numbers down. And I think overall, when you look at our business, I mean, we wrote down an average gross profit of about 4.8%. And when you look at margins, both in the U.K. and internationally, we were down about 60 basis points. So I think this is pretty much traditional. We're now getting back to where we were, these margins where we were a number of years ago. But we're watching that. One thing that's impacted us in the U.K. is that there's a lot of low-rate financing, which we didn't have in the past. So that's probably taken 100 basis points from us, because we're now dealing with that and the OEMs are attracting the customers based on low-rate financing, something that has been traditional here in the U.S. but really hadn't been so strong in the international markets.

That's great. Now that leaves me with my last question. The international business for you tends to -- is much stronger than many people had feared. Is it that low rate financing or is there something else that you're seeing going on, particularly in the U.K.? And if we see a lot of weakness, is there the potential for the European government to potentially put some scrap programs back in place like they have, or other stimulus for demand? I'm just curious what you're seeing in the markets there.

I think we really have 2 markets. We have Continental Europe, then we got the U.K. And if you look at the U.K., the market was up, on a total unit basis, was up 7.4%. And I think our brands were up 6.6%, so pretty much equal to the market. But what I see in the U.K. is 13 quarters in a row where we've had increases. And what's happened, we're -- in the Premium/Luxury side, about 96% or 97% is Premium/Luxury. If you go back 3 or 4 years, you'll see that, that marketplace from the Premium/Luxury has grown probably 600 basis points. So we're getting the benefit of the premium guys going from being premium down into the Q3, down into the 1 series, the A and B series for Mercedes, you see that going on got to B [ph] with Porsche. So we're getting the benefit of that. The premium market has gone now from 19% to 25%. So I think that's key. I don't see any slowdown. I think there's a lot of competition amongst the brands. Certainly, we look at Audi, BMW and Mercedes, and we represent all 3 of them, and I think the benefactor of all this really will probably be the consumer, because they're looking at everything they can do to get a low cost of ownership proposition in front of the customer. But we see in our margins, decent there. We certainly could see some more used car availability. I talked about executive cars earlier in my comments. We bought over 1,000 cars in the fourth quarter of '11. We need to generate more used cars. We've got 21 buyers out in the U.K. It's ironic, with that kind of number of people, that we can't generate enough cars. But that…

And next, we'll go to Rick Nelson with Stephens.

. I'd like to ask you about the acquisitions that you've made over the past year, how those are performing relative to your expectations. As I look at SG&A to gross and the flow-through on a same-store compared to the consolidated, it would appear like there's some opportunities with the acquired stores, so if you could discuss that.

Yes, you could see the leverage was not quite as good on the acquisition story, and I guess it's one of the things that all the public's bring to the party, is once you can consolidate back office and some of the sales processes, you get that benefit. Obviously, the biggest acquisition we made last year was the Agnew Group in Northern Ireland, and that's turned out to be a terrific acquisition for us. They've been on budget each quarter last year. In the first quarter, they beat budget, and we're excited about opportunities to expand in that market, which we're, at the present time, looking at right now. Then we moved into Madison, with Lexus and Toyota, when we bought the group there. And I think that at the end of the day, we've had some tough weather, as you might expect in the Midwest. And I think the big thing there is we're trying to get the people up to speed, meaning we were probably short some of the key people we needed from a sales perspective, but as far as metrics and the return on what we had expected when we did our modeling, I would say that they're returning quite well. And it's, obviously, early, with just 4 or 5 months under our belt, but I would say we made that acquisition in Northern Ireland back in January a year ago and that's really integrated perfectly, and that team up there, it's seasoned. We haven't lost anybody there. In fact, I think the feedback I get in the trips I've made there recently show that they like the push from our center guys. The integration is good, there's a lot of best practices that we're sharing back and forth. And I might say that the BMW store in Northern Ireland was the #1 BMW store in Europe. It was named by BMW International. So it's quite a kudos for that group, so we're proud of that.

And I wanted a discussion about units in operation and the impact on your service. But it looks like the gross per unit and the volume foreign on a used -- from a used standpoint improved year-over-year. How do you see that units in operation now, as we get more supply, possibly affecting the margins and the sales in used as we go forward?

Well, I think that, obviously, more units in operation will drive our margin either up or down. I think we've been fortunate with Toyota and Honda being our major brand. Those have been strong. And we've gone to retail first. In fact, I think I said earlier that we have 1,000 cars on our PenskeCars.com under $1,000, and we're starting to see some strong margins on this lower priced cost of sale unit. So overall, I think that we've had a slight increase on volume foreign, it was about $23. And on the Premium/Luxury, I think we were down $243 because we're selling some of the older vehicles and we just can't get the finance. You're pretty much capped, Rick, as you get into certain of these vehicles, you do too much reconditioning, you're capped on a margin from a financial lease source. So we hit some ceilings from a certain type vehicle. And CPO cost is high as well on the other vehicles. But overall, I'm pretty happy with the return from a gross perspective, quarter-over-quarter.

Great. And if I could ask one final one about April. What you're seeing there in the U.S. and the U.K.? I know that there were some changes in the personal income tax rate, a reduction at the high-end in the U.K. and how that might be affecting sales there?

I think the reports coming out of the U.K., at least what's been written, the market is up double-digit in April. I can't tell you what it's going to be by the end of the quarter, and certainly, we're seeing the same momentum that we ended March with going on into April here in the U.S. But I really don't -- can't give you a forecast. But I certainly feel good about the market and I think we're stabilizing, probably have a run rate here over the next -- hopefully, over the next 3 to 5 years, which is consistent. I don't think you're going to see 30% and 40% increases by the peer group. I think there were comps that are going to get a little bit tougher, but I think we're going to see the business as very, very solid, and with the addition of more units in operation and the Parts and Service growth that it generates will give us a strong coverage of our fixed costs. And to me, that's going to drive profitability on a net income line and also EPS. And we'll see the OEMs report next Wednesday. I think we're on track for a 15 million to 15.5 million SAAR. So I think the lights are green right now.

Our next question is from Brian Sponheimer with Gabelli & Company. Brian Sponheimer - Gabelli & Company, Inc.: I have a question for you on some of the capital improvements at your dealership groups. You've been through a number of them over the course of the last 4 years. Just kind of wondering where you stand as far as from a CapEx perspective, thinking about getting to the end of this run, with some of the major improvements that have been need -- that have been required by dealers?

Well, I think if you go back and look at our growth from, say 2005 and '06 to where we are today, a lot of that was through acquisitions. And part of that acquisition, we made a commitment to the OEMs to meet the current CI requirements. So we've done a lot of that pre-2013. I think the run rate, we were -- we spent about $2.3 billion on capital expenditures over the last 10 years. So I think today we are at a run rate somewhere around $100 million to $125 million, and our amortization and depreciation is about $60 million. I think BMW is coming up now with a new CI program. I think we're consistent at Porsche. We're consistent at Mercedes-Benz. We're consistent at Audi. So I think BMW is really the only hurdle. Land Rover, we just completed one of those in Phoenix, and in the balance of the domestics, we're in good shape. So to me, when I look at this, we have to focus on the U.K., and the U.K. has already been going through some of the CI requirements for BMW. We have 1 big project, Sheffield, in the U.K., which will probably fall into 2014. So I think the run rate that we have is pretty much consistent. And, again, we've invested in our service shops, we're getting the benefit out of that. The investment in the body shops are driving that. And now, we're looking at the small rapid repair capabilities and putting a paint booth in some of our larger dealerships to do that work right on site. That's one of the things that we picked up as a great opportunity, which has been demonstrated by our guys in the international markets. So overall CapEx, $100 million to $125 million. Now, in our CapEx, I don't want people to get confused, accounting makes us put our rental cars into that category, but x rental cars, I think that number of $110 million to $125 million is realistic. And for the quarter, we spent $21 million in the U.S., $8 million internationally and $29 million overall. Brian Sponheimer - Gabelli & Company, Inc.: All right. And just to stay on Parts and Service, just for a follow-up here. Some of your peers are looking into getting into more oil changes and tires as a way to get -- to drive more traffic, and that would be hurtful to gross margin. You're obviously bucking that trend. What are you seeing coming back to you on the customer pay side that may be wasn't there before a couple of years ago?

Well, I think that what's driving -- you take Toyota, with their full-service capability. What they've done with oil change is we get 0.8 of an hour in our labor rate, which is probably $100, that's $80, plus we get the oil. So we're making a considerable margin on that compared to if you're going out to a Jiffy Lube. And to me, it's not just the oil change itself, it's the up-sell, it's the safety inspection, tires and then maybe other work that you'll do, wheel alignment, which these things have high margin. So I think getting that customer in, and I think the hook, obviously, is the oil change or the safety check. Now, internationally, one of the things we've really pushed is winter tires, and then we are now storing tires and special wheels for our clients on the international market. This has turned out to be a big business. We get the car in once and we change over the tires, we refurbish wheels if they have to be, sell tires, and we get a chance to see that customer. So to me, this continued connection with the customer through parts and service is key, and I think and all of my peers on the public side understand this. I think it's going to put pressure on some of these other people that specialize in certain areas, because the OEM and the requirements for the technology to work on these new cars, you have to be well trained and have all the, obviously, software in order to be able to diagnose, in many cases, these vehicles. So we're sitting in the right spot. And, again, in our case, over 58% gross margin will drive our overall margin up, I hope, as we go forward in the additional units in operations, whether it's tires, whether it's oil changes or just details. We're selling details to customers on the service side. We'll incentivize our service writers to do that. So all of that drives more gross profit. I think that's what's given us, along with our body shop, revenue. And then the PDI, with more used cars, we do the, obviously, the get-ready on these used cars and to me, that is also driving margin.

The next question is from Brett Hoselton from KeyBanc.

First question, and this is back to Matt's original question, I think. On the first quarter, you're up 8%, your target is to be up more than 10% for the full-year. That either suggests that your same-store sales are going to improve through the remaining 3 quarters or that you're going to make a fairly sizable amount of acquisitions. I mean, I calculate the difference between 8% growth and 10% growth to be about $300 million. How do we think about you potentially achieving your target through the remainder of the year?

Well, I think that you've got to look at our pipeline. Obviously, we're not commenting today on how big our pipeline is, but we do have acquisitions that we're working on every day from an M&A perspective, and we're going to be strategic. And remember, I said to the market, we'd be 10%, 5% and 5% was really what I gave the market at the beginning of 2013. Now, we over-performed on a same-store basis and maybe slightly underperformed on the acquisition side, but it doesn't take much in order for us to meet that requirement and we would expect to do that.

And then gross profit throughput, SG&A leverage. I mean, if you run out the full year at 77.5%, that seems feasible, given that your revenue is going to be up sequentially throughout the remainder of the year. You're going to be well over 100-basis-point improvement year-over-year. What are some of the potential headwinds or maybe there aren't any headwinds through the remainder of the year in your mind?

I think that if I set the speed at 100 basis points, I want to be sure I'm there. I think that at the end of the day, when you look at this quarter, we had the registration period. We have that in the first and third quarter, which give us a little bit more business to drive through the SG&A. So that probably -- the flow-through's a little bit better. We won't have that benefit in Q2 and Q4, but I'm comfortable with 100%. Our goal, obviously, is not to sit at 100. And I think sequentially, which I think is really important to us, we got 200 basis points. So I think we can stay on track and meet that, and hopefully, your calculations will drive some thought process with us that we can get a little north of 100. But I don't want to commit it on the phone to you today.

And next, we'll go to Simeon Gutman with Credit Suisse. Simeon Gutman - Crédit Suisse AG, Research Division: Same topic, on the SG&A. The improvement -- the flow-through was good, thanks for the extra color on, I guess, reminding us on the registration piece. But it looks like in general, the trends are improving there, and I'm curious how much you think is coming from blocking and tackling compared to costs that are structurally being taken out of the business. And if you could remind us -- I think buying the real estate versus leasing is helping, I don't know how much -- what that was in the quarter.

Well, I think the key thing is that we now have tied our compensation to our gross profit. It's a metric that I use in all of our business comp to gross. And as our gross goes down, the elevator goes down, obviously, in compensation and vice versa. And I think that our senior management, if you look even at my comp, is based on a certain increase year-over-year, and that's what drives my compensation. We tied that in from the highest level down to the working level, and I think that the team has bought into that. So I would say comp to gross is key. You mentioned real estate. I wrote that down as you were talking, it's a key area. Areas where we can go in and buy out some of these higher-priced sale leasebacks, we're doing it. Unfortunately, we have one in Warwick, Rhode Island, which is double-digit on a cap rate. And obviously, today we could refinance that at 500 or 600 basis points less. And those are the things that sometimes you're going to have to live with. But as we go forward, with our capital base and our debt-to-cap, we're in such good shape and then the OEMs are very interested in giving us support there, we would look at a different structure. But when you were growing at the speed we were in the earlier years, we didn't have that capability. So I see that as key going forward. The other, obviously, is in our marketing and advertising. With the digital world coming to us now, some of the spending that we did, obviously, probably more costly than to be effective today with the use of the Internet and some of the tools that are available to us. Our service business is…

Well, I think there's no question that, number one, the biggest piece of SG&A is compensation. And if that rolls with the gross profit, we shouldn't be negatively impacted, but I certainly see Parts and Service staying in that 55 to 58 category going forward. And to me, from an overall gross profit standpoint, I think that it's really about our managers and being able to drive it. And I think the metrics, I think our systems, our browser system we have internally, we have that access to that information here in the U.S. on an hour-by-hour basis, and we're restructuring some of that in the U.K., where we can have some of the same metrics available to us. And I think our CRMs are driving better behavior, dealer socket [ph] from the standpoint of our sales, practices. These are things that are going to continue to grow. Right now I think our company, we're in a position we've grown, as you know, from less than $1 billion to where we are today. We've got a lot of experienced people in the business. And now, what we're doing is really fine tuning our set up, and then I think we're getting the benefit, in the meantime, same-store growth and obviously, acquisitions. I said this to many people. I don't see a muffler on any of the publics. We're consolidated in the U.S., maybe by 20% by the publics or maybe a little bit less. So there's a big runway for us domestically, and I think our impact by going into the international markets and today, where there's some very, I think selective, good opportunities for us, we have the benefit to grow there, too. So we're in a global business. The good news is our OEMs see us as a global player. We see them, whether it's in Italy, or Germany or the U.K. or the U.S., we see these same key people. So I think -- and they see the progress we've made, and I think we represent the brands properly. And with that, we get opportunities that are beneficial to us, so we expect to take advantage of those going forward. Simeon Gutman - Crédit Suisse AG, Research Division: Okay. And my last question, can you just remind us where -- what percentage of the business is CPO today? And then where -- how that compares historically?

Well, when you look at CPO, we're about 33%. But I want to make a point here. I'm not -- and that's in the U.S. I'm not driving hard to get to 35% to 40%. What I want to do is get the right cars CPO-ed. Because if you take cars that need too much reconditioning, you're going to drive the cost of sales up and you're going to put a cap -- finance companies will put a cap on what you can get from a gross margin standpoint. So we're meeting any metrics that the manufacturers have, but I think it's really important to say what's a CPO car and what isn't. But to me, I think it's a great product that all OEMs have today. There's a lot of ads. I see the Mercedes-Benz advertising in the sports page on their CPO stuff. So there's a lot of support there. But again, at the end of the day, it's certainly a focus of ours.

And next, we'll go to Patrick Archambault with Goldman Sachs.

Just a couple of higher-level ones for me. Number one is, just because we've been getting questions on it, the CFPB discussion on limiting spread premiums. Can you tell us a little bit about what the potential impact is? I mean, I understand that you being in Luxury, it's probably not as relevant as it may be from -- for some of your competitors, but just your thoughts on that one? And then I have a follow-up just on the yen.

Okay. Well, let me say this. Obviously, from our perspective, the CFPB regulates lenders, not dealers, and we haven't had any of our financial partners approach us, and we have almost 65% of all of our business goes through the captives. So we obviously, if there's any impact, it could be in dealer reserve. I think what we've all done though, is we have self-imposed caps based on what we would -- could markup, and I went back because I knew this has been a question before. It looks like we're at 150 basis points if you look over the last 12 months. And to me, at the end of the day, our business, 65% is U.S. and 35% is international. So you can say, take 1/3 of our business and take that off the table, and then you look at our lease penetration rate from the standpoint of our portfolio, it's significant. And a lot of those have flat rates from the standpoint of -- from a finance reserve, have a flat rate that you can get. Now from a product standpoint, whether it's extended service contract, whether it's LoJack, whether it's gap, whether it's tire and wheel, all of those things, obviously, can be sold to the customer in a package, but I don't think those are the things that the board is looking at. So to me, I think that we provide a value in the process, and I think the lenders will give us a contribution. And I think that's certainly within the legality of the law. On the other hand, when we send in Dave Jones as a name into one of our manufacturers, finance source or a bank, we send in credit information, then he's put in its matrix, it's looking at statistics, then they decide what level his credit would be and for that they give us a cap and a collar that we can work in. So to me, I think it's regulated. And right now, it's not something that we're focusing on. I think there's been more noise about it. I'm not sure you're doing that, but if you listen to Mike Jackson, and you listen to some of the key guys in the business, I think we all understood that a long time ago in the days of dealer financing and what has to take place when we put in these caps and collars. And to me, when you look at BMW and Mercedes and Honda and Toyota and Audi to mention a few, these people are sophisticated. They understand the financing process. They have big books of this business. So I'm sure that if there's anything that we have to do to change our behavior, that they'll be the ones that will help us manage to that point.

Okay. That's a helpful way to frame it. The -- my follow-up was just on the yen. It seems like we haven't really seen much impact in incentives as of yet, based on that. But first of all, maybe 2 things. Number one, are you sensing that there may be changes in promotional activity ahead, just based on where the yen has gotten? And number two is how do you think such a thing would really impact you?

Well, I think we've got to look at where we are today. I think that, of the Toyota and Honda products, 65% to 75% is built here in the U.S., which I think that really takes all the wind out of that sail. And I don't think that there'd be any more price competition than there has been in the past, with Nissan, with -- certainly Nissan has built plants in the U.S. also. I think that the OEMs will get aggressive to meet sales targets. You'll have -- many times, you'll have models that will be running out and they'll get very aggressive on those. But at this point, I think we're in pretty good shape. In fact, as you probably know, that the RX, from a Lexus perspective, is being built in Canada and that represents 40% of the volume. And VW, obviously, 30% of their vehicles are built in Chattanooga. And from a Honda perspective, I think almost over 80% of their vehicles are built in the U.S. So I think it's a moot point.

And next, we'll go to Scott Stember with Sidoti & Company. Scott L. Stember - Sidoti & Company, LLC: Can you maybe talk about the Other line on the income statement, $2.3 million versus $4.4 million, was that related to Penske truck leasing?

Yes, that was -- basically in the first quarter of 2012, we had a significant number -- more number of vehicles, used trucks we sold, and that drove that gain on sale. And we won't have as many trucks to sell in 2013. The good news is though, that the gross profit earnings on each sale was up over Q1 of last year. So we're in good shape. It was about $1.6 million to $1.7 million of that number. Scott L. Stember - Sidoti & Company, LLC: Great. And can you talk about, on the Parts and Service side again, if you look at the reconditioning work, can you maybe just talk about how that will go forward if you break it out between the U.S. and the U.K.? If you can talk about that, please?

Yes, I don't have the numbers on reconditioning in the U.K., but it's -- I said it was 3% in the U.S. And that continues to grow because we are, I'll tell you, from a sublet -- and that's always been an expense or a revenue piece on the financial statements and the dealer statement, where do you sublet. I want to see that 0. What we're trying to do is do all that inside and with that, that comes under reconditioning and predelivery inspection. And there's no question that the rapid repair in the U.K. is something that we picked up, where they're doing tire and wheel and some of the smaller chips and dents, they call them in the U.K. So I think that's a key part rather than going outside to a third party to do that work. So to me, I think it's key. And when you look at get-ready on a same-store, I said it was 3.1%. In total, it was 5.1% as far as part of our business in the first quarter. Scott L. Stember - Sidoti & Company, LLC: Got you. And the breakout on the Parts and Service that you gave earlier, 6.1% customer pay, 10% warranty, was that in the U.S.?

Total. Scott L. Stember - Sidoti & Company, LLC: Oh, that was total. Okay, got you. And just last question on brands on the new side. If you could just talk about the brands that did better for you than compared to the ones that didn't?

Well, when you look at overall, I'd have to look at the overall brand perspective, and there's no question that BMW is strong. Mercedes has been strong for us. Audi, Porsche has been off the charts domestically. And when you look at these, there's no question that our BMW business I think was up 26% in the U.S. And overall, when you look at your Mercedes, was up 7% or 8%, Porsche was up 73%. So the numbers are pretty strong, but, again, this is our sweet spot. And when you look at Honda, Honda and Toyota, we had a big increase in that. When you look at volume foreign, we were up 15% with Toyota and we were up about 5% with Honda in the quarter.

And we have a question from David Whiston with Morningstar.

I wanted to go back to the split in Europe that you talked about between the U.K. and the continent. It sounds like you're not at all worried that the double-digit declines you're seeing in some big Western European continental markets will spread to the U.K., and is that optimism just purely because of all the growth you're seeing in the luxury market like you talked about earlier?

We've been talking about contagion now for the last 18 months, and there's been 13 quarters that we've seen the U.K. market continue to grow. And I'm not sure that they're bulletproof from a standpoint of anything happening, but I just have to look at the past. And to me, I see some stabilization in the premium brands other than in Germany, and obviously in Italy and Spain, in the last couple of weeks. And they're seeing a little bit increase in some of those markets. So I think they're divided. I don't think that one runs off the other. The good news is that the availability of the best models now, which might have been not available to us, because they're trying to provide those in the European market, are now available to us in the U.S. -- I mean, excuse me, in the U.K. So I'm managing the business based on a continued increase. Remember that market is about 2 million people. And I think that at the end of the day, with the personal tax rate declining from 50% to 45% for someone making over GBP 150,000, I think, is very good. So to me, at the end of the day, that will drive -- help drive our business.

Okay, that's helpful. On capital allocation, do you plan to repurchase shares all the time regardless of where the stock is trading, or could there be some quarters where you won't make any repurchase activity, depending on M&A activity or where the stock is actually trading?

Well, I think that we have $85 million availability from our board right now. And the shares that we purchased in the first quarter really leveled out our share purchases, based on our share outstanding where it was a year ago. A lot of those shares were generated through restricted stock, and for our key management, some of our management team. So what we're trying to do is keep the shares outstanding level. Again, when you look at our dividend, it's running at a 2% return and the payout's about 26%. Obviously, we'll look at share buyback. We'll look at increasing dividend and payout, that's something that our board looks at every quarter. So I'd stay tuned on that. But, obviously, we think the stock, is, at this rate, is a great buy. And to me, we're not buying it because it's high or because it's low. I think it's just about what capital we have and have the opportunity to make those share purchases. But that was the basis of the 400,000. I think if you look at that in the past year, it was pretty much similar, same type of behavior.

Okay. And lastly, I'm sorry if I missed this, but did you give U.S. new vehicle retail unit growth year-over-year? I'm just trying to see how you guys compare to the 6% increase for the industry.

Yes. We were actually -- when you look at new vehicles for us on a same-store basis, we were up 9%. And overall, in the U.S. by itself, we were up 11.8%. So we really outperformed the market.

You said 11.8%?

11.8%, yes. We're up 13.8% on used.

And Mr. Penske, no additional questions in queue.

Thank you very much, John. See you next quarter. Thank you.

Thank you. And ladies and gentlemen, that does conclude your conference for today. Thank you for your participation. You may now disconnect.