CarMax Reports Record Third Quarter Results

  CarMax Reports Record Third Quarter Results

Business Wire

RICHMOND, Va. -- December 20, 2013

CarMax, Inc. (NYSE:KMX) today reported record results for the third quarter
ended November 30, 2013.

  *Net sales and operating revenues increased 13% to $2.94billion.
  *Used unit sales in comparable stores increased 10%.
  *Total used unit sales rose 15%.
  *Total wholesale unit sales increased 4%.
  *CarMax Auto Finance (CAF) income increased 16% to $83.9million.
  *Net earnings grew 12% to $106.5million. Net earnings per diluted share
    rose 15% to $0.47.

“We are pleased with our continued growth in sales and earnings,” said Tom
Folliard, president and chief executive officer. “The earnings growth was
driven by double digit increases in total used units and CAF income.”

Third Quarter Business Performance Review

Sales. Total used vehicle unit sales grew 15% and comparable store used units
grew 10% versus the prior year’s third quarter. Comparable store used unit
sales benefited from improved execution in our stores and an attractive
consumer credit environment, as well as a modest increase in store traffic.
Wholesale vehicle unit sales grew 4% compared with last year’s quarter,
reflecting the growth in our store base.

Other sales and revenues declined 5% year-over-year. Extended service plan
(ESP) revenues were similar to the prior year, as the increase driven by the
growth in our retail vehicle sales was offset by an increase in our allowance
for ESP returns of $0.02 per diluted share. The rise in the allowance
reflected increases in ESP cancellations prior to the end of their contract
term. Net third-party finance fees declined by $4.6million as the third-party
subprime providers (those who purchase financings at a discount) originated
18% of used vehicle unit sales in the current quarter versus 15% in the prior
year’s third quarter. Over the last two years, the volume of this financing
has increased, as our third-party subprime providers have been making more
attractive offers. Late in the quarter, however, we began to see tightening of
the credit terms offered by our subprime providers.

Gross Profit. Total gross profit increased 11% to $381.7million. Used vehicle
gross profit rose 16%, driven by the increase in total used unit sales, while
used vehicle gross profit per unit remained comparable with the prior year
period at $2,149. Wholesale vehicle gross profit was similar to the prior
year’s quarter, as the 4% increase in wholesale unit sales was offset by a
decrease in wholesale vehicle gross profit per unit, which declined $36 to
$887. Other gross profit rose 2%, reflecting flat ESP revenues and the
decrease in net third-party finance fees, as well as higher service department
profits.

SG&A. Selling, general and administrative expenses increased 11% to
$284.4million. The increase primarily reflected both the 12%increase in our
store base since the beginning of last year’s third quarter (representing the
addition of 13 stores) and higher variable selling costs resulting from our
10% increase in comparable store used unit sales. SG&A per retail unit
declined $98 to $2,295, as our comparable store used unit sales growth
generated overhead leverage.

CarMax Auto Finance.^(1) CAF income increased 16% to $83.9million as a result
of the 24% increase in average managed receivables, partly offset by a lower
total interest margin. Average managed receivables grew to $6.81 billion,
reflecting the rise in CAF loan originations in recent years. The total
interest margin, which reflects the spread between interest and fees charged
to consumers and our funding costs, declined to 6.8% of average managed
receivables in the current quarter from 7.4% in last year’s third quarter.

In the fourth quarter of fiscal 2014, CAF plans to launch a test originating
loans for customers who typically would be financed by our subprime providers.
Given the relevance of subprime to our business and the overall market, we
believe it is prudent to gain further insight into underwriting and servicing
accounts within this credit profile. Over the next 12 months, we plan to
originate approximately $70 million of loans in this test. The test will be
funded separately from our current portfolio and not included in our current
public securitization program.

Superstore Openings. During the third quarter of fiscal 2014, we opened three
stores, including one in Jackson, Tennessee; one in Brandywine, Maryland (our
eighth store in the Baltimore/Washington, D.C. market); and one in the St.
Louis, Missouri market. Subsequent to the end of the quarter, we opened our
second store in St. Louis and we entered the Philadelphia, Pennsylvania market
with two stores.

Share Repurchase Program. During the third quarter, we repurchased 0.3million
shares of common stock for $14.8million pursuant to our share repurchase
program. As of November30,2013, we had $400.0million remaining available
for repurchase under the program.

^(1) Although CAF benefits from certain indirect overhead expenditures, we
have elected not to allocate indirect costs to CAF in order to avoid making
arbitrary allocation decisions.

Supplemental Financial Information

Amounts and percentage calculations may not total due to rounding.

                                                                                 
Sales
Components
                                                              
                Three Months Ended November 30                Nine Months Ended November 30
(In           2013         2012         Change      2013         2012         Change
millions)
Used
vehicle         $ 2,396.8       $ 2,068.7       15.9    %     $ 7,738.1       $ 6,449.6       20.0    %
sales
New vehicle       50.1            45.7          9.6     %       162.5           162.5         0.0     %
sales
Wholesale
vehicle           437.3           427.7         2.2     %       1,402.8         1,332.5       5.3     %
sales
Other sales
and
revenues:
Extended
service           48.8            48.6          0.3     %       178.4           152.7         16.8    %
plan
revenues
Service
department        26.1            24.8          5.3     %       80.8            76.4          5.8     %
sales
Third-party
finance        (17.7   )    (13.1   )   (35.3 ) %    (64.6   )    (38.9   )   (66.0 ) %
fees, net
Total other
sales and      57.2        60.4       (5.2  ) %    194.6       190.2      2.3    %
revenues
Total net
sales and     $ 2,941.4    $ 2,602.4    13.0   %   $ 9,498.0    $ 8,134.9    16.8   %
operating
revenues
                                                                                                      

                                                                
Comparable Store Used Vehicle
Sales Changes ^(1)
                                                                             
                                      Three Months Ended     Nine Months Ended
                                      November 30            November 30
                                   2013       2012    2013       2012
Used vehicle units                    10  %        12  %     14  %        5  %
Used vehicle dollars                  10  %        13  %     15  %        6  %
                                                                             

^(1) As of November 30, 2013 and 2012, the number of stores included in the
comparable store base were 113 and 106, respectively.

                                                               
Total Used Vehicle Sales Changes
                                                                            
                                     Three Months Ended     Nine Months Ended
                                     November 30            November 30
                                  2013       2012    2013       2012
Used vehicle units                   15  %        16  %     20  %        9  %
Used vehicle dollars                 16  %        17  %     20  %        10 %
                                                                            

                                                  
Unit Sales
                                                           
                       Three Months Ended      Nine Months Ended
                       November 30             November 30
                    2013      2012      2013      2012
Used vehicles          122,065     105,815     394,073     329,422
New vehicles           1,818       1,705       5,954       6,164
Wholesale vehicles     82,743      79,747      262,342     246,059
                                                           

                                                         
Average Selling Prices
                                                                    
                           Three Months Ended        Nine Months Ended
                           November 30               November 30
                        2013       2012       2013       2012
Used vehicles              $ 19,469     $ 19,344     $ 19,480     $ 19,375
New vehicles               $ 27,428     $ 26,681     $ 27,176     $ 26,241
Wholesale vehicles         $ 5,123      $ 5,214      $ 5,185      $ 5,267
                                                                    

                                                                                        
Selected
Operating
Ratios
                                                                                                         
                   Three Months Ended                              Nine Months Ended
                   November 30                                     November 30
(In millions)    2013        %       2012        %       2013        %       2012        %
                                 ^(1)                    ^(1)                    ^(1)                    ^(1)
Net sales and
operating          $ 2,941.4     100.0     $ 2,602.4     100.0     $ 9,498.0     100.0     $ 8,134.9     100.0
revenues
Gross profit       $ 381.7       13.0      $ 345.2       13.3      $ 1,264.6     13.3      $ 1,095.1     13.5
CarMax Auto        $ 83.9        2.9       $ 72.5        2.8       $ 255.3       2.7       $ 223.3       2.7
Finance income
Selling,
general, and       $ 284.4       9.7       $ 257.3       9.9       $ 857.8       9.0       $ 765.6       9.4
administrative
expenses
Interest           $ 7.6         0.3       $ 8.1         0.3       $ 23.3        0.2       $ 24.4        0.3
expense
Earnings
before income      $ 173.2       5.9       $ 152.5       5.9       $ 637.6       6.7       $ 529.2       6.5
taxes
Net earnings       $ 106.5       3.6       $ 94.7        3.6       $ 393.4       4.1       $ 327.1       4.0
                                                                                                         

^(1) Calculated as the ratio of the applicable amount to net sales and
operating revenues.

                                                                  
Gross
Profit
                                                                                       
              Three Months Ended                   Nine Months Ended
              November 30                          November 30
(In         2013      2012      Change     2013        2012        Change
millions)
Used
vehicle       $ 262.4     $ 227.0     15.6   %     $ 859.5       $ 718.2       19.7    %
gross
profit
New
vehicle         1.1         0.9       30.9   %       3.4           4.1         (15.3 ) %
gross
profit
Wholesale
vehicle         73.4        73.6      (0.2 ) %       237.4         230.5       3.0     %
gross
profit
Other
gross        44.8     43.7    2.4   %    164.3      142.3     15.4   %
profit
Total       $ 381.7   $ 345.2   10.6  %   $ 1,264.6   $ 1,095.1   15.5   %
                                                                                       

                                                                               
Gross
Profit
per Unit
                                                                                                
              Three Months Ended                            Nine Months Ended
              November 30                                   November 30
           2013                 2012                 2013                 2012
           $ per      %^(2)   $ per      %^(2)   $ per      %^(2)   $ per      %^(2)
              unit^(1)               unit^(1)               unit^(1)               unit^(1)
Used
vehicle       $  2,149     10.9      $  2,146     11.0      $  2,181     11.1      $  2,180     11.1
gross
profit
New
vehicle       $  636       2.3       $  518       1.9       $  578       2.1       $  659       2.5
gross
profit
Wholesale
vehicle       $  887       16.8      $  923       17.2      $  905       16.9      $  937       17.3
gross
profit
Other
gross         $  361       78.3      $  407       72.4      $  411       84.4      $  424       74.8
profit
Total
gross         $  3,081     13.0      $  3,211     13.3      $  3,161     13.3      $  3,263     13.5
profit
                                                                                                

^(1) Calculated as category gross profit divided by its respective units sold,
except the other and total categories, which are divided by total retail units
sold.
^(2) Calculated as a percentage of its respective sales or revenue.

                                                                   
SG&A
Expenses
                                                                                         
                 Three Months Ended                     Nine Months Ended
                 November 30                            November 30
(In            2013      2012      Change       2013      2012       Change
millions)
Compensation
and benefits     $ 161.4     $ 144.0       12.1   %     $ 494.4     $ 427.1       15.8   %
^ (1)
Store
occupancy          53.9        51.1        5.4    %       160.9       149.8       7.4    %
costs
Advertising        23.4        22.5        3.7    %       77.0        76.7        0.3    %
expense
Other
overhead        45.7     39.7     15.2  %    125.5    112.0    12.2  %
costs ^ (2)
Total SG&A     $ 284.4   $ 257.3    10.5  %   $ 857.8   $ 765.6    12.0  %
expenses
SG&A per         $ 2,295     $ 2,393     $ (98  )       $ 2,144     $ 2,281     $ (137 )
unit
                                                                                         

^(1) Excludes compensation and benefits related to reconditioning and vehicle
repair service, which is included in cost of sales.
^(2) Includes IT expenses, insurance, non-CAF bad debt, travel, preopening and
relocation costs, charitable contributions and other administrative expenses.

                                                                                                          
Components of CAF Income and Other CAF
Information
                                                                                                                          
                 Three Months Ended November 30                            Nine Months Ended November 30
(In            2013            %        2012          %       2013            %       2012            %    
millions)                          ^(1)                         ^(1)                         ^(1)                         ^(1)
Interest
margin:
Interest and     $ 138.3           8.1        $ 125.1           9.1        $ 409.0           8.4        $ 368.9           9.3
fee income
Interest        (22.2   )    (1.3 )    (23.3   )    (1.7 )    (67.6   )    (1.4 )    (72.4   )    (1.8 )
expense
Total
interest           116.1           6.8          101.8           7.4          341.4           7.0          296.5           7.5
margin
Provision
for loan        (19.7   )    (1.2 )    (18.1   )    (1.3 )    (49.0   )    (1.0 )    (40.2   )    (1.0 )
losses
Total
interest
margin after       96.4            5.7          83.7            6.1          292.4           6.0          256.3           6.5
provision
for loan
losses
Other income       ―               ―            0.2             ―            0.1             ―            ―               ―
Total direct    (12.5   )    (0.7 )    (11.4   )    (0.8 )    (37.2   )    (0.8 )    (33.0   )    (0.8 )
expenses
CarMax Auto
Finance        $ 83.9        4.9     $ 72.5        5.3     $ 255.3       5.2     $ 223.3       5.7  
income
                                                                                                                          
Total
average          $ 6,805.3                    $ 5,477.4                    $ 6,491.4                    $ 5,266.0
managed
receivables
Net loans        $ 960.6                      $ 856.2                      $ 3,168.7                    $ 2,465.4
originated
Net CAF
penetration        40.6      %                  41.2      %                  41.2      %                  38.3      %
rate
Weighted
average            7.0       %                  7.7       %                  6.9       %                  8.2       %
contract
rate
                                                                                                                          
Ending
allowance        $ 67.9                       $ 54.3                       $ 67.9                       $ 54.3
for loan
losses
                                                                                                                          
Warehouse
facility
information:
Ending
funded           $ 807.0                      $ 876.0                      $ 807.0                      $ 876.0
receivables
Ending
unused           $ 993.0                      $ 724.0                      $ 993.0                      $ 724.0
capacity
                                                                                                                          

^(1) Annualized percent of total average managed receivables.

                                                                
Earnings
Highlights
                                                                                    
                Three Months Ended                   Nine Months Ended
                November 30                          November 30
(In
millions      2013      2012      Change     2013      2012      Change
except per
share data)
Net             $ 106.5     $ 94.7      12.4   %     $ 393.4     $ 327.1     20.3   %
earnings
Diluted
weighted
average           227.4       232.7     (2.3 ) %       227.9       232.0     (1.8 ) %
shares
outstanding
Net
earnings        $ 0.47      $ 0.41      14.6   %     $ 1.73      $ 1.41      22.7   %
per diluted
share
                                                                                    

Planned Superstore Openings

We currently plan to open the following superstores within 12 months from
November 30, 2013:

                                                              
                                                       Market        Planned
Location                    Television Market      Status      Opening
                                                                     Date
St. Peters, Missouri ^        St. Louis                Existing      Q4 Fiscal
(1)                                                                  2014
Newark, Delaware ^ (1)        Philadelphia             New           Q4 Fiscal
                                                                     2014
King of Prussia,              Philadelphia             New           Q4 Fiscal
Pennsylvania ^ (1)                                                   2014
Frederick, Maryland           Washington/Baltimore     Existing      Q4 Fiscal
                                                                     2014
Elk Grove, California         Sacramento               Existing      Q4 Fiscal
                                                                     2014
Rochester, New York           Rochester                New           Q1 Fiscal
                                                                     2015
Dothan, Alabama               Dothan                   New           Q1 Fiscal
                                                                     2015
Mechanicsburg,                Harrisburg/Lancaster     Existing      Q1 Fiscal
Pennsylvania                                                         2015
Spokane, Washington           Spokane                  New           Q1 Fiscal
                                                                     2015
Madison, Wisconsin            Madison                  New           Q2 Fiscal
                                                                     2015
Fort Worth, Texas             Dallas                   Existing      Q2 Fiscal
                                                                     2015
Lynchburg, Virginia           Roanoke/Lynchburg        New           Q2 Fiscal
                                                                     2015
Milwaukie, Oregon             Portland                 New           Q2 Fiscal
                                                                     2015
Beaverton, Oregon             Portland                 New           Q3 Fiscal
                                                                     2015
Tupelo, Mississippi           Tupelo                   New           Q3 Fiscal
                                                                     2015
Reno, Nevada                  Reno                     New           Q3 Fiscal
                                                                     2015
Raleigh, North Carolina       Raleigh                  Existing      Q3 Fiscal
                                                                     2015
                                                                     

^(1) Opened in December 2013.

Normal construction, permitting or other scheduling delays could shift the
opening dates of any of these stores into a later period. We currently
estimate capital expenditures will total approximately $300million in fiscal
2014. We expect to open between 10 and 15 superstores in each of the following
2fiscal years.

Conference Call Information

We will host a conference call for investors at 9:00 a.m. ET today, December
20, 2013. Domestic investors may access the call at 1-888-298-3261
(international callers dial 1-706-679-7457). The conference I.D. for both
domestic and international callers is 26830857. A live webcast of the call
will be available on our investor information home page at investor.carmax.com
and at www.streetevents.com.

A webcast replay of the call will be available at investor.carmax.com through
April 3, 2014. A telephone replay also will be available through December 31,
2013, and may be accessed by dialing 1-855-859-2056 (international callers
dial 1-404-537-3406). The conference I.D. for both domestic and international
callers is 26830857.

Fourth Quarter and Fiscal Year 2014 Earnings Release Date

We currently plan to release results for the fourth quarter and fiscal year
ending February 28, 2014, on Friday, April4,2014, before the opening of the
New York Stock Exchange. We will host a conference call for investors at
9:00a.m. ET on that date. Information on this conference call will be
available on our investor information home page at investor.carmax.com in
March 2014.

About CarMax

CarMax, a member of the Fortune 500 and the S&P 500, and one of the Fortune
“100 Best Companies to Work For,” for nine consecutive years, is the nation’s
largest retailer of used vehicles. Headquartered in Richmond, Va., CarMax
currently operates 129 used car superstores in 64 markets. The CarMax consumer
offer features low, no-haggle prices, a broad selection of CarMax Quality
Certified used vehicles and superior customer service. During the twelve
months ended February 28, 2013, the company retailed 447,728 used vehicles and
sold 324,779 wholesale vehicles at our in-store auctions. For more
information, access the CarMax website at www.carmax.com.

Forward-Looking Statements

We caution readers that the statements contained in this release about our
future business plans, operations, opportunities or prospects, including
without limitation any statements or factors regarding expected sales, margins
or earnings, are forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are based upon management’s current knowledge and
assumptions about future events and involve risks and uncertainties that could
cause actual results to differ materially from anticipated results. Among the
factors that could cause actual results and outcomes to differ materially from
those contained in the forward-looking statements are the following:

  *Changes in general or regional U.S. economic conditions.
  *Changes in the competitive landscape within our industry.
  *Changes in the availability or cost of capital and working capital
    financing, including changes related to the asset-backed securitization
    market.
  *Changes in consumer credit availability related to our third-party
    financing providers.
  *Significant changes in retail prices for used and new vehicles.
  *A reduction in the availability of or access to sources of inventory.
  *Factors related to the regulatory and legislative environment in which we
    operate.
  *Events that damage our reputation or harm the perception of the quality of
    our brand.
  *Security breaches or other events that result in the misappropriation,
    loss or other unauthorized disclosure of confidential customer or
    associate information.
  *Factors related to geographic growth, including the inability to acquire
    or lease suitable real estate at favorable terms or to effectively manage
    our growth.
  *The loss of key employees from our store, regional or corporate management
    teams or a significant increase in labor costs.
  *The failure of key information systems.
  *The effect of various litigation matters.
  *Adverse conditions affecting one or more automotive manufacturers or
    manufacturer recalls.
  *The occurrence of severe weather events.
  *Factors related to the seasonal fluctuations in our business.
  *Factors related to the geographic concentration of our superstores.
  *The effect of new accounting requirements or changes to U.S. generally
    accepted accounting principles.
  *Acts of terrorism, the outbreak of war, or other significant national or
    international events.

For more details on factors that could affect expectations, see our Annual
Report on Form 10-K for the fiscal year ended February 28, 2013, and our
quarterly or current reports as filed with or furnished to the Securities and
Exchange Commission. Our filings are publicly available on our investor
information home page at investor.carmax.com. Requests for information may
also be made to the Investor Relations Department by email to
investor_relations@carmax.com or by calling 1-804-747-0422 ext. 4391. We
disclaim any intent or obligation to update our forward-looking statements.


CARMAX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)

                                                                                                      
                     Three Months Ended November 30                        Nine Months Ended November 30
(In thousands                        %                         %                           %                         %
except per        2013         ^(1)     2012        ^(1)     2013         ^(1)     2012        ^(1)
share data)
SALES AND
OPERATING
REVENUES:
Used vehicle       $ 2,396,840      81.5      $ 2,068,742     79.5      $ 7,738,118      81.5      $ 6,449,613     79.3
sales
New vehicle          50,073          1.7         45,693        1.8         162,502         1.7         162,543       2.0
sales
Wholesale            437,272         14.9        427,650       16.4        1,402,838       14.8        1,332,495     16.4
vehicle sales
Other sales       57,222       1.9      60,361      2.3      194,558      2.0      190,219     2.3
and revenues
NET SALES AND
OPERATING            2,941,407       100.0       2,602,446     100.0       9,498,016       100.0       8,134,870     100.0
REVENUES
Cost of sales     2,559,686    87.0     2,257,227   86.7     8,233,456    86.7     7,039,743   86.5
GROSS PROFIT         381,721         13.0        345,219       13.3        1,264,560       13.3        1,095,127     13.5
CARMAX AUTO          83,905          2.9         72,454        2.8         255,346         2.7         223,309       2.7
FINANCE INCOME
Selling,
general and          284,366         9.7         257,282       9.9         857,761         9.0         765,559       9.4
administrative
expenses
Interest             7,649           0.3         8,065         0.3         23,288          0.2         24,360        0.3
expense
Other (loss)      (411       )  ―        139         ―        (1,243     )  ―        683         ―
income
Earnings
before income        173,200         5.9         152,465       5.9         637,614         6.7         529,200       6.5
taxes
Income tax        66,748       2.3      57,784      2.2      244,237      2.6      202,137     2.5
provision
NET EARNINGS     $ 106,452      3.6     $ 94,681      3.6     $ 393,377      4.1     $ 327,063     4.0
WEIGHTED
AVERAGE COMMON
SHARES:
Basic                223,259                     228,904                   223,831                     228,346
Diluted              227,417                     232,656                   227,870                     232,048
NET EARNINGS
PER SHARE:
Basic              $ 0.48                      $ 0.41                    $ 1.76                      $ 1.43
Diluted            $ 0.47                      $ 0.41                    $ 1.73                      $ 1.41
                                                                                                                     

^(1) Calculated as a percentage of net sales and operating revenues and sums
may not equal totals due to rounding.

                                                            
CARMAX, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
                                                            
                            (Unaudited)                          (Unaudited)
                            November 30        February 28       November 30
(In thousands except      2013            2013           2012        
share data)
ASSETS
CURRENT ASSETS:
Cash and cash               $ 664,758          $ 449,364         $ 445,110
equivalents
Restricted cash from
collections on auto           246,795            224,287           204,360
loan receivables
Accounts receivable,          68,027             91,961            62,660
net
Inventory                     1,556,277          1,517,813         1,339,044
Deferred income taxes         2,651              5,193             9,315
Other current assets       20,286         21,513        24,875    
TOTAL CURRENT ASSETS          2,558,794          2,310,131         2,085,364
Auto loan receivables,        6,892,311          5,895,918         5,552,035
net
Property and equipment,       1,588,633          1,428,970         1,411,588
net
Deferred income taxes         151,281            145,875           147,571
Other assets               112,856        107,708       101,125   
TOTAL ASSETS              $ 11,303,875    $ 9,888,602    $ 9,297,683 
LIABILITIES AND
SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable            $ 367,478          $ 336,721         $ 272,807
Accrued expenses and
other current                 138,910            147,821           116,629
liabilities
Accrued income taxes          8,554              222               266
Short-term debt               1,287              355               706
Current portion of
finance and capital           17,837             16,139            15,885
lease obligations
Current portion of
non-recourse notes         214,535        182,915       169,399   
payable
TOTAL CURRENT                 748,601            684,173           575,692
LIABILITIES
Finance and capital
lease obligations,            320,791            337,452           341,424
excluding current
portion
Non-recourse notes
payable, excluding            6,755,534          5,672,175         5,211,064
current portion
Other liabilities          190,580        175,635       145,834   
TOTAL LIABILITIES          8,015,506      6,869,435     6,274,014 
Commitments and
contingent liabilities
SHAREHOLDERS’ EQUITY:
Common stock, $0.50 par
value; 350,000,000
shares authorized;
223,228,360 and
225,906,108 shares            111,614            112,953           114,108
issued and outstanding
as of November 30, 2013
and February 28, 2013,
respectively
Capital in excess of          1,013,939          972,250           942,017
par value
Accumulated other             (57,127    )       (59,808   )       (51,745   )
comprehensive loss
Retained earnings          2,219,943      1,993,772     2,019,289 
TOTAL SHAREHOLDERS’        3,288,369      3,019,167     3,023,669 
EQUITY
TOTAL LIABILITIES AND     $ 11,303,875    $ 9,888,602    $ 9,297,683 
SHAREHOLDERS’ EQUITY
                                                                   

                                                            
CARMAX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
                                                           
                                             Nine Months Ended November 30
(In thousands)                             2013           2012           
OPERATING ACTIVITIES:
Net earnings                                 $ 393,377         $ 327,063
Adjustments to reconcile net earnings to
net cash used in operating activities:
Depreciation and amortization                  73,983             70,721
Share-based compensation expense               54,948             46,597
Provision for loan losses                      48,993             40,154
Loss on disposition of assets                  1,844              1,554
Deferred income tax benefit                    (4,576     )       (6,569     )
Net decrease (increase) in:
Accounts receivable, net                       23,934             23,774
Inventory                                      (38,464    )       (246,452   )
Other current assets                           3,480              (7,336     )
Auto loan receivables, net                     (1,045,386 )       (632,342   )
Other assets                                   (6,714     )       (506       )
Net increase (decrease) in:
Accounts payable, accrued expenses and
other current liabilities and accrued          1,707              (102,666   )
income taxes
Other liabilities                           (266       )    (13,220    )
NET CASH USED IN OPERATING ACTIVITIES       (493,140   )    (499,228   )
INVESTING ACTIVITIES:
Capital expenditures                           (212,900   )       (184,942   )
Proceeds from sales of assets                  5,143              ―
Increase in restricted cash from               (22,508    )       (46        )
collections on auto loan receivables
Increase in restricted cash in reserve         (7,826     )       (6,912     )
accounts
Release of restricted cash from reserve        15,022             15,980
accounts
Purchases of money market securities,          (3,833     )       (2,088     )
net
Purchases of investments                       (1,868     )       (1,525     )
available-for-sale
Sales of investments available-for-sale     71             318        
NET CASH USED IN INVESTING ACTIVITIES       (228,699   )    (179,215   )
FINANCING ACTIVITIES:
Increase (decrease) in short-term debt,        932                (237       )
net
Payments on finance and capital lease          (14,963    )       (10,365    )
obligations
Issuances of non-recourse notes payable        5,300,000          4,010,000
Payments on non-recourse notes payable         (4,185,021 )       (3,313,626 )
Repurchase and retirement of common            (196,748   )       (51,091    )
stock
Equity issuances, net                          19,967             29,486
Excess tax benefits from share-based        13,066         16,728     
payment arrangements
NET CASH PROVIDED BY FINANCING              937,233        680,895    
ACTIVITIES
Increase in cash and cash equivalents          215,394            2,452
Cash and cash equivalents at beginning      449,364        442,658    
of year
CASH AND CASH EQUIVALENTS AT END OF        $ 664,758       $ 445,110    
PERIOD
                                                                  

Contact:

CarMax, Inc.
Investors and Financial Media:
Katharine Kenny, Vice President, Investor Relations, (804) 935-4591
Celeste Gunter, Manager, Investor Relations, (804) 935-4597
or
General Media:
Trina Lee, Director, Public Relations, (855) 887-2915
Catherine Gryp, Manager, Public Relations, (855) 887-2915
 
Press spacebar to pause and continue. Press esc to stop.