Auto dealership group CarMax Inc. (KMX) on Monday posted a 13 percent increase in quarterly profit on higher used vehicle sales and said it expects net sales to more than double in the next five years, sending it shares up more than 6 percent.

The company, however, issued a cautious outlook for the second quarter, saying high U.S. gasoline and wholesale auction prices, which drive up its acquisition costs, were likely to put a damper on profits.

Net income at CarMax rose to $39.8 million, or 37 cents per share, for the quarter ending May 31 compared to $35.3 million, or 33 cents per share, a year ago.

Total sales rose 19 percent to $1.58 billion, from $1.32 billion a year ago. Comparable store sales rose 6 percent, CarMax said.

Wall Street analysts on an average had expected an operating profit of 36 cents per share, according to Reuters Estimates.

First-quarter earnings included 3 cents per share from a favorable valuation adjustment of CarMax's finance unit and a public securitization completed in April, the company said.

The company had trimmed its quarterly forecast in May, saying high gasoline prices appear to be hurting demand for cars.

"We believe some of the same factors that affected the marketplace last spring and summer put pressure on the market this spring, including an atypical rise in wholesale auction prices and higher gas prices," Chief Executive and President Austin Ligon said in a statement.

The sales pace began to lose some momentum in April and weakened further in May, reflecting a softening used-car market environment, he added.

CarMax expects the trend to continue during the second quarter.

The Richmond, Virginia-based company said it sees second-quarter profits in the range of 29 cents to 34 cents per share and said same-store sales will rise 3 percent to 9 percent. Wall Street analysts on average forecast a 34-cent second-quarter profit, according to Reuters Estimates.

CarMax also said in a regulatory filing on Monday that it expects net sales and operating revenue in the range of $10 billion to $12 billion by fiscal year 2010.

The company's net sales were $5.26 billion last year.

The company also said in the filing it sees annual used-car comparable store sales increases of 4 percent to 8 percent by fiscal year 2010, while it continues to expand the company store base 15 percent to 20 percent annually.

CarMax shares were up $1.45, or 5.61 percent, at $27.30 on the New York Stock Exchange (search), but were off from an earlier high of $27.65.