Lithia Motors Inc (LAD)

Pretax margin

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before tax but after interest (EBT) (ttm)	US$ in thousands	1,351,500	1,408,300	1,505,400	1,564,200	1,719,200	1,815,600	1,781,700	1,739,200	1,482,200	1,308,800	1,106,800	795,700	648,500	486,300	384,600	361,800	375,400	358,700	350,300	345,600
Revenue (ttm)	US$ in thousands	30,848,600	30,176,800	29,204,400	28,342,500	28,084,900	27,422,400	26,318,100	25,093,700	22,727,900	20,377,000	17,838,800	14,600,400	13,069,800	12,354,800	12,083,600	12,562,400	12,624,200	12,377,000	12,136,600	12,011,400
Pretax margin		4.38%	4.67%	5.15%	5.52%	6.12%	6.62%	6.77%	6.93%	6.52%	6.42%	6.20%	5.45%	4.96%	3.94%	3.18%	2.88%	2.97%	2.90%	2.89%	2.88%

December 31, 2023 calculation

Pretax margin = EBT (ttm) ÷ Revenue (ttm)
= $1,351,500K ÷ $30,848,600K
= 4.38%

The pretax margin of Lithia Motors, Inc. has shown a declining trend over the past eight quarters, falling from 6.92% in Q1 2022 to 4.39% in Q4 2023. This indicates that the company's profitability before considering taxes has been decreasing over time.

The decrease in pretax margin could be attributed to various factors such as increasing operating expenses, declining sales revenue, or inefficiencies in cost management. It is essential for the company to closely monitor and address the underlying reasons for the declining pretax margin to ensure long-term financial sustainability and profitability.

Further analysis and comparison with industry peers can provide more insights into the company's performance and help in identifying areas for improvement to enhance profitability in the future.