CarMax income up despite declining margins

CarMax Inc. reported that its income from its finance unit operations increased 15% compared with the same quarter last year. This was spurred by an increase in originations and managed receivables, which more than offset the decline in gain spread. The gain on loans sold as a percent of loans sold was 3.3% in the second quarter, slightly below the normalized range of 3.5% to 4.5%, according to the company. Additionally, its Drive Financial subprime finance provider contributed approximately 1% of CarMax's 10% used unit growth.