S&P: Group 1 Auto unaffected

Standard & Poor's said Thursday that the ratings and outlook on Group 1 Automotive Inc. (BB/stable/--) would be not be affected at this time by the company's reduced earnings expectations for the third quarter and full year 2004.

S&P said it expected an earnings guidance revision, given the current challenging industry conditions, including softer-than-expected vehicle sales during the third quarter and the impact of hurricanes in the Southeast.

Group 1's results will also be affected by continued poor results at its Atlanta dealership platform, and the company has begun an assessment of the recoverability of goodwill associated with this platform, which could result in an asset write-off.

Despite the current challenges, S&P said it expects Group 1 to remain solidly profitable. Group 1 lowered its 2004 earnings-per-share estimate to $2.70-$2.80 from the $2.95-$3.15 range it estimated in July.

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