Penske Automotive Group took a strong hit from the trio of hurricanes that stormed through the Caribbean and the Gulf of Mexico since the end of August.
The dealer group recently provided a preliminary estimate of the impact on its operations in Florida, Georgia, Texas and Puerto Rico from Hurricanes Irma, Harvey and Maria. The company operates 19 dealerships and three collision centers in the affected areas, which represented approximately 9 percent of the company’s consolidated revenue for the six months that ended June 30.
Penske emphasized that Hurricane Maria has significantly impacted the island of Puerto Rico as the power grid and communication systems on the island have been severely damaged. As a result, certain segment of the company’s operations there have been suspended and are expected to remain impacted for the immediate future, according to a news release distributed by Penske.
“Our first priority in Puerto Rico is assisting our employees and their families as recovery efforts continue on the island and we are working directly with our Puerto Rico team towards that end,” the company said.
Penske continued that Hurricanes Irma and Harvey disrupted operations in Florida, Georgia (particularly the Atlanta market) and Texas, especially Houston. Operations in Florida and Texas were impacted for nearly one week while Georgia experienced a disruption in operations for two days or less.
The company indicated operations in Florida, Texas and Georgia are now operating at full capacity.
“The well-being of our associates and their families, some of which have suffered significant hardship, is our first priority,” chairman Roger Penske reiterated.
“We are directly assisting those employees who suffered storm-related damages and have paid employees who were unable to work because of these hurricanes,” he continued. “The efforts of our employees in preparing our dealerships for the storms in the affected areas prevented significant losses and I thank them for their outstanding efforts.”
As a result of the hurricanes, the company’s third quarter financial performance is expected to be adversely impacted.
Executives noted the assessment of losses in Puerto Rico is ongoing and is expected to continue for the immediate future as basic services to the island resume. The company currently estimates that storm-related losses, expenses, and business interruption, net of expected insurance proceeds, will reduce earnings per share by $0.04 to $0.05 for the three months ended Sept. 30.
Further information will be provided when the company reports its third quarter financial results, company officials added.