Sonic Falls Most in Three Weeks on Accounting Weakness
Sonic Automotive Inc. (SAH), the third- largest public U.S. auto-dealership group, plunged the most in three weeks after telling regulators it delayed the filing of its annual report because of accounting at its dealerships.
Sonic fell 3.1 percent to $23.60 at the close in New York, the biggest one-day decline since Feb. 25. The shares dropped as much as 8.4 percent, the biggest intraday slide since Oct. 15.
Sonic said in a regulatory filing it believes that financial results will be the same as reported on Feb. 20, when the Charlotte, North Carolina-based company said that 2012 adjusted profit climbed 20 percent to $1.71 a share. U.S. auto dealerships last year benefited from a 13 percent increase in new light-vehicle sales, the biggest annual gain since 1984, according to researcher Autodata Corp.
“The company has determined that a material weakness existed in the effectiveness of controls over its dealership level accounting processes resulting from the aggregation of control deficiencies,” Sonic said today in the filing. The company said that it plans to file its annual report within a 15-day extension period.
Sonic rose 13 percent this year through today, exceeding the Standard & Poor’s 500 Index’s 8.8 percent increase.
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