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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Asbury Automotive Group Inc | NYSE:ABG | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-2.19 | -1.04% | 208.45 | 213.45 | 208.41 | 212.18 | 218,476 | 21:05:18 |
|
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
Delaware
|
|
01-0609375
|
|
|
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
|
|
|
|
|
2905 Premiere Parkway NW,
|
Suite 300
|
|
|
|
|
Duluth,
|
Georgia
|
|
30097
|
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
|
Trading
|
|
|
Title of each class
|
|
Symbol(s)
|
|
Name of each exchange on which registered
|
Common stock, $0.01 par value per share
|
|
ABG
|
|
New York Stock Exchange
|
Large Accelerated Filer
|
☒
|
|
Accelerated Filer
|
☐
|
|
|
|
|
|
Non-Accelerated Filer
|
☐
|
|
Smaller Reporting Company
|
☐
|
|
|
|
|
|
|
|
|
Emerging Growth Company
|
☐
|
|
|
|
Page
|
PART I—Financial Information
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
PART II—Other Information
|
|
|
|
|
|
||
|
||
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
ASSETS
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
388.6
|
|
|
$
|
3.5
|
|
Contracts-in-transit
|
64.7
|
|
|
194.7
|
|
||
Accounts receivable, net
|
89.4
|
|
|
136.2
|
|
||
Inventories
|
1,059.7
|
|
|
985.0
|
|
||
Assets held for sale
|
28.7
|
|
|
154.2
|
|
||
Other current assets
|
122.1
|
|
|
129.0
|
|
||
Total current assets
|
1,753.2
|
|
|
1,602.6
|
|
||
PROPERTY AND EQUIPMENT, net
|
924.4
|
|
|
909.7
|
|
||
OPERATING LEASE RIGHT-OF-USE ASSETS
|
62.1
|
|
|
65.6
|
|
||
GOODWILL
|
206.5
|
|
|
201.7
|
|
||
INTANGIBLE FRANCHISE RIGHTS
|
113.2
|
|
|
121.7
|
|
||
OTHER LONG-TERM ASSETS
|
9.8
|
|
|
10.0
|
|
||
Total assets
|
$
|
3,069.2
|
|
|
$
|
2,911.3
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
||||
Floor plan notes payable—trade, net
|
$
|
118.4
|
|
|
$
|
130.3
|
|
Floor plan notes payable—non-trade, net
|
730.1
|
|
|
657.7
|
|
||
Current maturities of long-term debt
|
47.4
|
|
|
32.4
|
|
||
Current maturities of operating leases
|
17.3
|
|
|
17.0
|
|
||
Accounts payable and accrued liabilities
|
268.7
|
|
|
308.7
|
|
||
Liabilities associated with assets held for sale
|
—
|
|
|
100.9
|
|
||
Total current liabilities
|
1,181.9
|
|
|
1,247.0
|
|
||
LONG-TERM DEBT
|
1,117.5
|
|
|
907.0
|
|
||
OPERATING LEASE LIABILITIES
|
48.7
|
|
|
52.6
|
|
||
DEFERRED INCOME TAXES
|
24.9
|
|
|
26.0
|
|
||
OTHER LONG-TERM LIABILITIES
|
35.3
|
|
|
32.4
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 12)
|
|
|
|
||||
SHAREHOLDERS' EQUITY:
|
|
|
|
||||
Preferred stock, $.01 par value; 10,000,000 shares authorized; none issued or outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value; 90,000,000 shares authorized; 41,140,657 and 41,072,080 shares issued, including shares held in treasury, respectively
|
0.4
|
|
|
0.4
|
|
||
Additional paid-in capital
|
586.4
|
|
|
582.9
|
|
||
Retained earnings
|
1,114.0
|
|
|
1,094.5
|
|
||
Treasury stock, at cost; 21,845,622 and 21,791,707 shares, respectively
|
(1,033.6
|
)
|
|
(1,028.6
|
)
|
||
Accumulated other comprehensive loss
|
(6.3
|
)
|
|
(2.9
|
)
|
||
Total shareholders' equity
|
660.9
|
|
|
646.3
|
|
||
Total liabilities and shareholders' equity
|
$
|
3,069.2
|
|
|
$
|
2,911.3
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
REVENUE:
|
|
|
|
||||
New vehicle
|
$
|
822.1
|
|
|
$
|
871.8
|
|
Used vehicle
|
493.2
|
|
|
509.9
|
|
||
Parts and service
|
221.6
|
|
|
217.6
|
|
||
Finance and insurance, net
|
70.4
|
|
|
71.5
|
|
||
TOTAL REVENUE
|
1,607.3
|
|
|
1,670.8
|
|
||
COST OF SALES:
|
|
|
|
||||
New vehicle
|
785.7
|
|
|
833.9
|
|
||
Used vehicle
|
462.5
|
|
|
475.4
|
|
||
Parts and service
|
86.7
|
|
|
82.3
|
|
||
TOTAL COST OF SALES
|
1,334.9
|
|
|
1,391.6
|
|
||
GROSS PROFIT
|
272.4
|
|
|
279.2
|
|
||
OPERATING EXPENSES:
|
|
|
|
||||
Selling, general, and administrative
|
194.7
|
|
|
191.0
|
|
||
Depreciation and amortization
|
9.5
|
|
|
8.6
|
|
||
Franchise rights impairment
|
23.0
|
|
|
—
|
|
||
Other operating expense, net
|
10.2
|
|
|
1.8
|
|
||
INCOME FROM OPERATIONS
|
35.0
|
|
|
77.8
|
|
||
OTHER EXPENSES (INCOME):
|
|
|
|
||||
Floor plan interest expense
|
7.0
|
|
|
10.2
|
|
||
Other interest expense, net
|
17.0
|
|
|
13.9
|
|
||
Loss on extinguishment of long-term debt, net
|
20.6
|
|
|
—
|
|
||
Gain on dealership divestitures, net
|
(33.7
|
)
|
|
—
|
|
||
Total other expenses, net
|
10.9
|
|
|
24.1
|
|
||
INCOME BEFORE INCOME TAXES
|
24.1
|
|
|
53.7
|
|
||
Income tax expense
|
4.6
|
|
|
12.8
|
|
||
NET INCOME
|
$
|
19.5
|
|
|
$
|
40.9
|
|
EARNINGS PER SHARE:
|
|
|
|
||||
Basic—
|
|
|
|
||||
Net income
|
$
|
1.02
|
|
|
$
|
2.13
|
|
Diluted—
|
|
|
|
||||
Net income
|
$
|
1.01
|
|
|
$
|
2.11
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING:
|
|
|
|
||||
Basic
|
19.1
|
|
|
19.2
|
|
||
Restricted stock
|
0.1
|
|
|
0.1
|
|
||
Performance share units
|
0.1
|
|
|
0.1
|
|
||
Diluted
|
19.3
|
|
|
19.4
|
|
|
|
For the Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Net income
|
|
$
|
19.5
|
|
|
$
|
40.9
|
|
Other comprehensive (loss) income:
|
|
|
|
|
||||
Change in fair value of cash flow swaps
|
|
(4.5
|
)
|
|
(1.8
|
)
|
||
Income tax benefit associated with cash flow swaps
|
|
1.1
|
|
|
0.5
|
|
||
Comprehensive income
|
|
$
|
16.1
|
|
|
$
|
39.6
|
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Retained
Earnings |
|
Treasury Stock
|
|
Accumulated
Other Comprehensive Income (Loss) |
|
Total
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
||||||||||||||||||
Balances, December 31, 2019
|
41,072,080
|
|
|
$
|
0.4
|
|
|
$
|
582.9
|
|
|
$
|
1,094.5
|
|
|
21,791,707
|
|
|
$
|
(1,028.6
|
)
|
|
$
|
(2.9
|
)
|
|
$
|
646.3
|
|
Comprehensive Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
19.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19.5
|
|
||||||
Change in fair value of cash flow swaps, net of reclassification adjustment and $1.1 tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3.4
|
)
|
|
(3.4
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3.4
|
)
|
|
(3.4
|
)
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
3.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.8
|
|
||||||
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements
|
68,577
|
|
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
||||||
Repurchase of common stock associated with net share settlements of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53,915
|
|
|
(5.0
|
)
|
|
—
|
|
|
(5.0
|
)
|
||||||
Balances, March 31, 2020
|
41,140,657
|
|
|
$
|
0.4
|
|
|
$
|
586.4
|
|
|
$
|
1,114.0
|
|
|
21,845,622
|
|
|
$
|
(1,033.6
|
)
|
|
$
|
(6.3
|
)
|
|
$
|
660.9
|
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Treasury Stock
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
||||||||||||||||||
Balances, December 31, 2018
|
41,065,069
|
|
|
$
|
0.4
|
|
|
$
|
572.9
|
|
|
$
|
922.7
|
|
|
21,719,339
|
|
|
$
|
(1,023.4
|
)
|
|
$
|
0.6
|
|
|
$
|
473.2
|
|
Comprehensive Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
40.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40.9
|
|
||||||
Change in fair value of cash flow swaps, net of reclassification adjustment and $0.5 tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|
(1.3
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
40.9
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|
39.6
|
|
||||||
Cumulative effect adjustment of ASU 2018-02
|
—
|
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
3.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.9
|
|
||||||
Issuance of common stock in connection with share-based payment arrangements
|
238,078
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchase of common stock associated with net share settlement of employee share-based awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66,912
|
|
|
(4.7
|
)
|
|
—
|
|
|
(4.7
|
)
|
||||||
Share repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
108,978
|
|
|
(7.4
|
)
|
|
—
|
|
|
(7.4
|
)
|
||||||
Retirement of previously repurchased common stock
|
(108,978
|
)
|
|
—
|
|
|
(1.3
|
)
|
|
(6.1
|
)
|
|
(108,978
|
)
|
|
7.4
|
|
|
—
|
|
|
—
|
|
||||||
Balances, March 31, 2019
|
41,194,169
|
|
|
$
|
0.4
|
|
|
$
|
575.5
|
|
|
$
|
957.7
|
|
|
21,786,251
|
|
|
$
|
(1,028.1
|
)
|
|
$
|
(0.9
|
)
|
|
$
|
504.6
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
CASH FLOW FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
19.5
|
|
|
$
|
40.9
|
|
Adjustments to reconcile net income to net cash provided by operating activities—
|
|
|
|
||||
Depreciation and amortization
|
9.5
|
|
|
8.6
|
|
||
Share-based compensation
|
3.5
|
|
|
3.9
|
|
||
Deferred income taxes
|
0.1
|
|
|
—
|
|
||
Franchise rights impairment
|
23.0
|
|
|
—
|
|
||
Loss on extinguishment of long-term debt, net
|
20.6
|
|
|
—
|
|
||
Loaner vehicle amortization
|
5.8
|
|
|
5.8
|
|
||
Gain on divestitures, net
|
(33.7
|
)
|
|
—
|
|
||
Change in right-of-use asset
|
5.2
|
|
|
4.5
|
|
||
Other adjustments, net
|
0.2
|
|
|
3.2
|
|
||
Changes in operating assets and liabilities, net of acquisitions and divestitures—
|
|
|
|
||||
Contracts-in-transit
|
130.0
|
|
|
39.4
|
|
||
Accounts receivable
|
46.7
|
|
|
15.1
|
|
||
Inventories
|
7.9
|
|
|
(19.6
|
)
|
||
Other current assets
|
(36.3
|
)
|
|
(41.3
|
)
|
||
Floor plan notes payable—trade, net
|
(16.2
|
)
|
|
3.8
|
|
||
Accounts payable and other current liabilities
|
(52.6
|
)
|
|
4.6
|
|
||
Operating lease liabilities
|
(5.3
|
)
|
|
(4.6
|
)
|
||
Other long-term assets and liabilities, net
|
(0.2
|
)
|
|
0.9
|
|
||
Net cash provided by operating activities
|
127.7
|
|
|
65.2
|
|
||
CASH FLOW FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Capital expenditures—excluding real estate
|
(9.1
|
)
|
|
(3.6
|
)
|
||
Capital expenditures—real estate
|
(2.3
|
)
|
|
—
|
|
||
Purchases of previously leased real estate
|
—
|
|
|
(4.9
|
)
|
||
Acquisitions
|
(63.1
|
)
|
|
(118.5
|
)
|
||
Divestitures
|
115.5
|
|
|
—
|
|
||
Proceeds from the sale of assets
|
4.2
|
|
|
—
|
|
||
Net cash provided by (used in) investing activities
|
45.2
|
|
|
(127.0
|
)
|
||
CASH FLOW FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Floor plan borrowings—non-trade
|
1,124.1
|
|
|
1,066.3
|
|
||
Floor plan borrowings—acquisitions
|
27.1
|
|
|
47.7
|
|
||
Floor plan repayments—non-trade
|
(1,086.9
|
)
|
|
(1,033.6
|
)
|
||
Floor plan repayments—non-trade divestiture
|
(50.5
|
)
|
|
—
|
|
||
Proceeds from borrowings
|
1,355.3
|
|
|
—
|
|
||
Repayments of borrowings
|
(1,156.1
|
)
|
|
(3.9
|
)
|
||
Proceeds from sale and leaseback transaction
|
7.3
|
|
|
—
|
|
||
Payment of debt issuance costs
|
(3.1
|
)
|
|
—
|
|
||
Purchases of treasury stock
|
—
|
|
|
(7.4
|
)
|
||
Repurchases of common stock, including shares associated with net share settlement of employee share-based awards
|
(5.0
|
)
|
|
(4.7
|
)
|
||
Net cash provided by financing activities
|
212.2
|
|
|
64.4
|
|
||
Net increase in cash and cash equivalents
|
385.1
|
|
|
2.6
|
|
||
CASH AND CASH EQUIVALENTS, beginning of period
|
3.5
|
|
|
8.3
|
|
||
CASH AND CASH EQUIVALENTS, end of period
|
$
|
388.6
|
|
|
$
|
10.9
|
|
•
|
Coggin dealerships operating primarily in Jacksonville, Fort Pierce and Orlando, Florida;
|
•
|
Courtesy dealerships operating in Tampa, Florida;
|
•
|
Crown dealerships operating in North Carolina, South Carolina and Virginia;
|
•
|
Greenville Automotive dealerships operating in Greenville, South Carolina;
|
•
|
Hare and Estes dealerships operating in the Indianapolis, Indiana area;
|
•
|
McDavid dealerships operating in metropolitan Austin and Dallas, Texas;
|
•
|
Nalley dealerships operating in metropolitan Atlanta, Georgia;
|
•
|
Plaza dealerships operating in metropolitan St. Louis, Missouri; and
|
•
|
Mike Shaw dealerships in the Denver, Colorado area.
|
|
For the Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In millions)
|
||||||
Revenue:
|
|
|
|
||||
New vehicle
|
$
|
822.1
|
|
|
$
|
871.8
|
|
Used vehicle retail
|
446.0
|
|
|
458.2
|
|
||
Used vehicle wholesale
|
47.2
|
|
|
51.7
|
|
||
New and used vehicle
|
1,315.3
|
|
|
1,381.7
|
|
||
Sale of vehicle parts and accessories
|
36.8
|
|
|
36.9
|
|
||
Vehicle repair and maintenance services
|
184.8
|
|
|
180.7
|
|
||
Parts and services
|
221.6
|
|
|
217.6
|
|
||
Finance and insurance, net
|
70.4
|
|
|
71.5
|
|
||
Total revenue
|
$
|
1,607.3
|
|
|
$
|
1,670.8
|
|
|
|
|
|
|
Vehicle Repair and Maintenance Services
|
|
Finance and Insurance, net
|
|
Total
|
||||||
|
(In millions)
|
||||||||||
Contract Assets (Current), January 1, 2020
|
$
|
4.8
|
|
|
$
|
12.3
|
|
|
$
|
17.1
|
|
Transferred to receivables from contract assets recognized at the beginning of the period
|
(4.8
|
)
|
|
(4.1
|
)
|
|
(8.9
|
)
|
|||
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period
|
3.7
|
|
|
4.6
|
|
|
8.3
|
|
|||
Contract Assets (Current), March 31, 2020
|
$
|
3.7
|
|
|
$
|
12.8
|
|
|
$
|
16.5
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In millions)
|
||||||
Inventory
|
$
|
29.8
|
|
|
$
|
58.1
|
|
Real estate
|
14.5
|
|
|
29.8
|
|
||
Property and equipment
|
0.4
|
|
|
1.8
|
|
||
Goodwill and manufacturer franchise rights
|
19.2
|
|
|
32.1
|
|
||
Liabilities assumed
|
—
|
|
|
(0.8
|
)
|
||
Other
|
(0.3
|
)
|
|
—
|
|
||
Total purchase price
|
$
|
63.6
|
|
|
$
|
121.0
|
|
|
As of
|
||||||
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In millions)
|
||||||
Vehicle receivables
|
$
|
21.2
|
|
|
$
|
44.8
|
|
Manufacturer receivables
|
38.7
|
|
|
50.4
|
|
||
Other receivables
|
31.0
|
|
|
42.4
|
|
||
Total accounts receivable
|
90.9
|
|
|
137.6
|
|
||
Less—Allowance for credit losses
|
(1.5
|
)
|
|
(1.4
|
)
|
||
Accounts receivable, net
|
$
|
89.4
|
|
|
$
|
136.2
|
|
|
As of
|
||||||
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In millions)
|
||||||
New vehicles
|
$
|
861.1
|
|
|
$
|
802.6
|
|
Used vehicles
|
158.0
|
|
|
140.1
|
|
||
Parts and accessories
|
40.6
|
|
|
42.3
|
|
||
Total inventories
|
$
|
1,059.7
|
|
|
$
|
985.0
|
|
|
As of
|
||||||
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In millions)
|
||||||
Floor plan notes payable—trade (a)
|
$
|
133.7
|
|
|
$
|
146.5
|
|
Floor plan notes payable offset account
|
(15.3
|
)
|
|
(16.2
|
)
|
||
Floor plan notes payable—trade, net
|
$
|
118.4
|
|
|
$
|
130.3
|
|
|
|
|
|
||||
Floor plan notes payable—new non-trade (b)
|
$
|
784.8
|
|
|
$
|
773.6
|
|
Floor plan notes payable—used non-trade
|
110.0
|
|
|
—
|
|
||
Floor plan notes payable offset account
|
(164.7
|
)
|
|
(115.9
|
)
|
||
Floor plan notes payable—non-trade, net
|
$
|
730.1
|
|
|
$
|
657.7
|
|
|
As of
|
||||||
March 31, 2020
|
|
December 31, 2019
|
|||||
(In millions)
|
|||||||
6.00% Senior Subordinated Notes due 2024
|
$
|
—
|
|
|
$
|
600.0
|
|
4.50% Senior Notes due 2028
|
280.0
|
|
|
—
|
|
||
4.75% Senior Notes due 2030
|
320.0
|
|
|
—
|
|
||
Mortgage notes payable bearing interest at fixed rates
|
99.2
|
|
|
100.5
|
|
||
2018 Bank of America Facility (a)
|
105.3
|
|
|
88.3
|
|
||
2018 Wells Fargo Master Loan Facility
|
25.0
|
|
|
25.0
|
|
||
2013 BofA Real Estate Facility
|
16.5
|
|
|
35.5
|
|
||
2015 Wells Fargo Master Loan Facility (b)
|
75.5
|
|
|
76.8
|
|
||
2019 Bank of America Revolving Credit Facility
|
237.0
|
|
|
—
|
|
||
Finance lease liability
|
17.0
|
|
|
17.2
|
|
||
Total debt outstanding
|
1,175.5
|
|
|
943.3
|
|
||
Add—unamortized premium on 6.0% Senior Subordinated Notes due 2024
|
—
|
|
|
5.1
|
|
||
Less—debt issuance costs
|
(10.6
|
)
|
|
(9.0
|
)
|
||
Long-term debt, including current portion
|
1,164.9
|
|
|
939.4
|
|
||
Less—current portion, net of current portion of debt issuance costs
|
(47.4
|
)
|
|
(32.4
|
)
|
||
Long-term debt
|
$
|
1,117.5
|
|
|
$
|
907.0
|
|
|
As of
|
||||||
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In millions)
|
||||||
Carrying Value:
|
|
|
|
||||
6.00% Senior Subordinated Notes due 2024
|
$
|
—
|
|
|
$
|
598.8
|
|
4.50% Senior Notes due 2028
|
276.5
|
|
|
—
|
|
||
4.75% Senior Notes due 2030
|
315.2
|
|
|
—
|
|
||
Mortgage notes payable (a)
|
319.2
|
|
|
323.4
|
|
||
Total carrying value
|
$
|
910.9
|
|
|
$
|
922.2
|
|
|
|
|
|
||||
Fair Value:
|
|
|
|
||||
6.00% Senior Subordinated Notes due 2024
|
$
|
—
|
|
|
$
|
619.5
|
|
4.50% Senior Notes due 2028
|
238.0
|
|
|
—
|
|
||
4.75% Senior Notes due 2030
|
272.0
|
|
|
—
|
|
||
Mortgage notes payable (a)
|
344.2
|
|
|
364.2
|
|
||
Total fair value
|
$
|
854.2
|
|
|
$
|
983.7
|
|
|
As of
|
||||||
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In millions)
|
||||||
Other current liabilities
|
$
|
2.2
|
|
|
$
|
0.9
|
|
Other long-term liabilities
|
6.1
|
|
|
2.9
|
|
||
Total fair value
|
$
|
8.3
|
|
|
$
|
3.8
|
|
For the Three Months Ended March 31,
|
|
Results Recognized in Accumulated Other Comprehensive Income/(Loss)
|
|
Location of Amount Reclassified from Accumulated Other Comprehensive Income/(Loss) to Earnings
|
|
Amount Reclassified from Accumulated Other Comprehensive Income/(Loss)
to Earnings
|
||||
2020
|
|
$
|
(4.5
|
)
|
|
Other interest expense, net
|
|
$
|
(0.3
|
)
|
2019
|
|
$
|
(1.8
|
)
|
|
Floor plan interest expense and Other interest expense, net
|
|
$
|
—
|
|
|
|
|
|
|
|
|
•
|
The declines in sales and service revenue and ongoing disruptions in our operations, the operations of our vehicle and parts manufacturers and other suppliers, vendors and business partners, and the global economy in general due to the COVID-19 pandemic;
|
•
|
the seasonally adjusted annual rate of new vehicle sales in the United States;
|
•
|
general economic conditions and its expected impact on our revenue and expenses;
|
•
|
our expected parts and service revenue due to, among other things, improvements in vehicle technology;
|
•
|
our ability to limit our exposure to regional economic downturns due to our geographic diversity and brand mix;
|
•
|
manufacturers' continued use of incentive programs to drive demand for their product offerings;
|
•
|
our capital allocation strategy, including as it relates to acquisitions and divestitures, stock repurchases, dividends and capital expenditures; and
|
•
|
the growth of the brands that comprise our portfolio over the long-term and other factors.
|
•
|
The degree to which declines in sales and service revenue and ongoing disruptions in our operations, the operations of our vehicle and parts manufacturers and other suppliers, vendors and business partners, and the global economy in general due to the COVID-19 pandemic may adversely impact our business, results of operations, financial condition and cash flows;
|
•
|
changes in general economic and business conditions, including changes in employment levels, consumer confidence levels, consumer demand and preferences, the availability and cost of credit, fuel prices, levels of discretionary personal income and interest rates;
|
•
|
our ability to generate sufficient cash flows, maintain our liquidity and obtain any necessary additional funds for working capital, capital expenditures, acquisitions, stock repurchases, debt maturity payments and other corporate purposes, if necessary or desirable;
|
•
|
significant disruptions in the production and delivery of vehicles and parts for any reason, including the COVID-19 pandemic, natural disasters, product recalls, work stoppages or other occurrences that are outside of our control;
|
•
|
our ability to execute our automotive retailing and service business strategy while operating under restrictions and best practices imposed or encouraged by governmental and other regulatory authorities;
|
•
|
our ability to attract and retain skilled employees;
|
•
|
adverse conditions affecting the vehicle manufacturers whose brands we sell, and their ability to design, manufacture, deliver and market their vehicles successfully;
|
•
|
changes in the mix and total number of vehicles we are able to sell;
|
•
|
our outstanding indebtedness and our continued ability to comply with applicable covenants in our various financing and lease agreements, or to obtain waivers of these covenants as necessary;
|
•
|
high levels of competition in our industry, which may create pricing and margin pressures on our products and services;
|
•
|
our relationships with manufacturers of the vehicles we sell and our ability to renew, and enter into new framework and dealer agreements with vehicle manufacturers whose brands we sell, on terms acceptable to us;
|
•
|
the availability of manufacturer incentive programs and our ability to earn these incentives;
|
•
|
failure of our management information systems or any security breaches;
|
•
|
changes in laws and regulations governing the operation of automobile franchises, including trade restrictions, consumer protections, accounting standards, taxation requirements and environmental laws;
|
•
|
changes in, or the imposition of, new tariffs or trade restrictions on imported vehicles or parts;
|
•
|
adverse results from litigation or other similar proceedings involving us;
|
•
|
our ability to consummate planned mergers, acquisitions and dispositions;
|
•
|
any disruptions in the financial markets, which may impact our ability to access capital;
|
•
|
our relationships with, and the financial stability of, our lenders and lessors;
|
•
|
our ability to execute our initiatives and other strategies;
|
•
|
our ability to leverage gains from our dealership portfolio; and
|
•
|
our ability to successfully integrate businesses we may acquire, or that any business we acquire may not perform as we expected at the time we acquired it.
|
•
|
Coggin dealerships operating primarily in Jacksonville, Fort Pierce and Orlando, Florida;
|
•
|
Courtesy dealerships operating in Tampa, Florida;
|
•
|
Crown dealerships operating in North Carolina, South Carolina and Virginia;
|
•
|
Greenville Automotive dealerships operating in Greenville, South Carolina;
|
•
|
Hare and Estes dealerships operating in the Indianapolis, Indiana area;
|
•
|
McDavid dealerships operating in metropolitan Austin and Dallas, Texas;
|
•
|
Nalley dealerships operating in metropolitan Atlanta, Georgia;
|
•
|
Plaza dealerships operating in metropolitan St. Louis, Missouri; and
|
•
|
Mike Shaw dealerships operating in the Denver, Colorado area.
|
|
For the Three Months Ended March 31,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
|
(Dollars in millions, except per share data)
|
|||||||||||||
REVENUE:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
$
|
822.1
|
|
|
$
|
871.8
|
|
|
$
|
(49.7
|
)
|
|
(6
|
)%
|
Used vehicle
|
493.2
|
|
|
509.9
|
|
|
(16.7
|
)
|
|
(3
|
)%
|
|||
Parts and service
|
221.6
|
|
|
217.6
|
|
|
4.0
|
|
|
2
|
%
|
|||
Finance and insurance, net
|
70.4
|
|
|
71.5
|
|
|
(1.1
|
)
|
|
(2
|
)%
|
|||
TOTAL REVENUE
|
1,607.3
|
|
|
1,670.8
|
|
|
(63.5
|
)
|
|
(4
|
)%
|
|||
GROSS PROFIT:
|
|
|
|
|
|
|
|
|||||||
New vehicle
|
36.4
|
|
|
37.9
|
|
|
(1.5
|
)
|
|
(4
|
)%
|
|||
Used vehicle
|
30.7
|
|
|
34.5
|
|
|
(3.8
|
)
|
|
(11
|
)%
|
|||
Parts and service
|
134.9
|
|
|
135.3
|
|
|
(0.4
|
)
|
|
—
|
%
|
|||
Finance and insurance, net
|
70.4
|
|
|
71.5
|
|
|
(1.1
|
)
|
|
(2
|
)%
|
|||
TOTAL GROSS PROFIT
|
272.4
|
|
|
279.2
|
|
|
(6.8
|
)
|
|
(2
|
)%
|
|||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Selling, general, and administrative
|
194.7
|
|
|
191.0
|
|
|
3.7
|
|
|
2
|
%
|
|||
Depreciation and amortization
|
9.5
|
|
|
8.6
|
|
|
0.9
|
|
|
10
|
%
|
|||
Franchise rights impairment
|
23.0
|
|
|
—
|
|
|
23.0
|
|
|
—
|
%
|
|||
Other operating expense, net
|
10.2
|
|
|
1.8
|
|
|
8.4
|
|
|
NM
|
|
|||
INCOME FROM OPERATIONS
|
35.0
|
|
|
77.8
|
|
|
(42.8
|
)
|
|
(55
|
)%
|
|||
OTHER EXPENSES (INCOME):
|
|
|
|
|
|
|
|
|||||||
Floor plan interest expense
|
7.0
|
|
|
10.2
|
|
|
(3.2
|
)
|
|
(31
|
)%
|
|||
Other interest expense, net
|
17.0
|
|
|
13.9
|
|
|
3.1
|
|
|
22
|
%
|
|||
Loss on extinguishment of long-term debt, net
|
20.6
|
|
|
—
|
|
|
20.6
|
|
|
—
|
%
|
|||
Gain on dealership divestitures, net
|
(33.7
|
)
|
|
—
|
|
|
(33.7
|
)
|
|
—
|
%
|
|||
Total other expenses, net
|
10.9
|
|
|
24.1
|
|
|
(13.2
|
)
|
|
(55
|
)%
|
|||
INCOME BEFORE INCOME TAXES
|
24.1
|
|
|
53.7
|
|
|
(29.6
|
)
|
|
(55
|
)%
|
|||
Income tax expense
|
4.6
|
|
|
12.8
|
|
|
(8.2
|
)
|
|
(64
|
)%
|
|||
NET INCOME
|
$
|
19.5
|
|
|
$
|
40.9
|
|
|
$
|
(21.4
|
)
|
|
(52
|
)%
|
Net income per share—Diluted
|
$
|
1.01
|
|
|
$
|
2.11
|
|
|
$
|
(1.10
|
)
|
|
(52
|
)%
|
|
For the Three Months Ended March 31,
|
||||
|
2020
|
|
2019
|
||
REVENUE MIX PERCENTAGES:
|
|
|
|
||
New vehicle
|
51.1
|
%
|
|
52.2
|
%
|
Used vehicle retail
|
27.8
|
%
|
|
27.4
|
%
|
Used vehicle wholesale
|
2.9
|
%
|
|
3.1
|
%
|
Parts and service
|
13.8
|
%
|
|
13.0
|
%
|
Finance and insurance, net
|
4.4
|
%
|
|
4.3
|
%
|
Total revenue
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MIX PERCENTAGES:
|
|
|
|
||
New vehicle
|
13.4
|
%
|
|
13.6
|
%
|
Used vehicle retail
|
11.5
|
%
|
|
12.0
|
%
|
Used vehicle wholesale
|
(0.2
|
)%
|
|
0.3
|
%
|
Parts and service
|
49.5
|
%
|
|
48.5
|
%
|
Finance and insurance, net
|
25.8
|
%
|
|
25.6
|
%
|
Total gross profit
|
100.0
|
%
|
|
100.0
|
%
|
GROSS PROFIT MARGIN
|
16.9
|
%
|
|
16.7
|
%
|
SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT
|
71.5
|
%
|
|
68.4
|
%
|
|
For the Three Months Ended March 31,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
276.5
|
|
|
$
|
289.0
|
|
|
$
|
(12.5
|
)
|
|
(4
|
)%
|
Import
|
358.2
|
|
|
405.0
|
|
|
(46.8
|
)
|
|
(12
|
)%
|
|||
Domestic
|
187.4
|
|
|
177.8
|
|
|
9.6
|
|
|
5
|
%
|
|||
Total new vehicle revenue
|
$
|
822.1
|
|
|
$
|
871.8
|
|
|
$
|
(49.7
|
)
|
|
(6
|
)%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
16.9
|
|
|
$
|
19.1
|
|
|
$
|
(2.2
|
)
|
|
(12
|
)%
|
Import
|
10.6
|
|
|
11.7
|
|
|
(1.1
|
)
|
|
(9
|
)%
|
|||
Domestic
|
8.9
|
|
|
7.1
|
|
|
1.8
|
|
|
25
|
%
|
|||
Total new vehicle gross profit
|
$
|
36.4
|
|
|
$
|
37.9
|
|
|
$
|
(1.5
|
)
|
|
(4
|
)%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
4,992
|
|
|
5,162
|
|
|
(170
|
)
|
|
(3
|
)%
|
|||
Import
|
12,458
|
|
|
14,443
|
|
|
(1,985
|
)
|
|
(14
|
)%
|
|||
Domestic
|
4,527
|
|
|
4,504
|
|
|
23
|
|
|
1
|
%
|
|||
Total new vehicle units
|
21,977
|
|
|
24,109
|
|
|
(2,132
|
)
|
|
(9
|
)%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
275.7
|
|
|
$
|
287.5
|
|
|
$
|
(11.8
|
)
|
|
(4
|
)%
|
Import
|
323.3
|
|
|
359.6
|
|
|
(36.3
|
)
|
|
(10
|
)%
|
|||
Domestic
|
146.4
|
|
|
155.7
|
|
|
(9.3
|
)
|
|
(6
|
)%
|
|||
Total new vehicle revenue
|
$
|
745.4
|
|
|
$
|
802.8
|
|
|
$
|
(57.4
|
)
|
|
(7
|
)%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
$
|
17.0
|
|
|
$
|
19.1
|
|
|
$
|
(2.1
|
)
|
|
(11
|
)%
|
Import
|
9.3
|
|
|
10.4
|
|
|
(1.1
|
)
|
|
(11
|
)%
|
|||
Domestic
|
6.9
|
|
|
6.4
|
|
|
0.5
|
|
|
8
|
%
|
|||
Total new vehicle gross profit
|
$
|
33.2
|
|
|
$
|
35.9
|
|
|
$
|
(2.7
|
)
|
|
(8
|
)%
|
New vehicle units:
|
|
|
|
|
|
|
|
|||||||
Luxury
|
4,977
|
|
|
5,132
|
|
|
(155
|
)
|
|
(3
|
)%
|
|||
Import
|
11,340
|
|
|
12,842
|
|
|
(1,502
|
)
|
|
(12
|
)%
|
|||
Domestic
|
3,596
|
|
|
3,952
|
|
|
(356
|
)
|
|
(9
|
)%
|
|||
Total new vehicle units
|
19,913
|
|
|
21,926
|
|
|
(2,013
|
)
|
|
(9
|
)%
|
|
For the Three Months Ended March 31,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
37,407
|
|
|
$
|
36,161
|
|
|
$
|
1,246
|
|
|
3
|
%
|
Gross profit per new vehicle sold
|
$
|
1,656
|
|
|
$
|
1,572
|
|
|
$
|
84
|
|
|
5
|
%
|
New vehicle gross margin
|
4.4
|
%
|
|
4.3
|
%
|
|
0.1
|
%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Luxury:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
3,385
|
|
|
$
|
3,700
|
|
|
$
|
(315
|
)
|
|
(9
|
)%
|
New vehicle gross margin
|
6.1
|
%
|
|
6.6
|
%
|
|
(0.5
|
)%
|
|
|
||||
Import:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
851
|
|
|
$
|
810
|
|
|
$
|
41
|
|
|
5
|
%
|
New vehicle gross margin
|
3.0
|
%
|
|
2.9
|
%
|
|
0.1
|
%
|
|
|
||||
Domestic:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
1,966
|
|
|
$
|
1,576
|
|
|
$
|
390
|
|
|
25
|
%
|
New vehicle gross margin
|
4.7
|
%
|
|
4.0
|
%
|
|
0.7
|
%
|
|
|
||||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue per new vehicle sold
|
$
|
37,433
|
|
|
$
|
36,614
|
|
|
$
|
819
|
|
|
2
|
%
|
Gross profit per new vehicle sold
|
$
|
1,667
|
|
|
$
|
1,637
|
|
|
$
|
30
|
|
|
2
|
%
|
New vehicle gross margin
|
4.5
|
%
|
|
4.5
|
%
|
|
—
|
%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Luxury:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
3,416
|
|
|
$
|
3,722
|
|
|
$
|
(306
|
)
|
|
(8
|
)%
|
New vehicle gross margin
|
6.2
|
%
|
|
6.6
|
%
|
|
(0.4
|
)%
|
|
|
||||
Import:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
820
|
|
|
$
|
810
|
|
|
$
|
10
|
|
|
1
|
%
|
New vehicle gross margin
|
2.9
|
%
|
|
2.9
|
%
|
|
—
|
%
|
|
|
||||
Domestic:
|
|
|
|
|
|
|
|
|||||||
Gross profit per new vehicle sold
|
$
|
1,919
|
|
|
$
|
1,619
|
|
|
$
|
300
|
|
|
19
|
%
|
New vehicle gross margin
|
4.7
|
%
|
|
4.1
|
%
|
|
0.6
|
%
|
|
|
|
For the Three Months Ended March 31,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenue
|
$
|
446.0
|
|
|
$
|
458.2
|
|
|
$
|
(12.2
|
)
|
|
(3
|
)%
|
Used vehicle wholesale revenue
|
47.2
|
|
|
51.7
|
|
|
(4.5
|
)
|
|
(9
|
)%
|
|||
Used vehicle revenue
|
$
|
493.2
|
|
|
$
|
509.9
|
|
|
$
|
(16.7
|
)
|
|
(3
|
)%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
31.2
|
|
|
$
|
33.6
|
|
|
$
|
(2.4
|
)
|
|
(7
|
)%
|
Used vehicle wholesale gross profit
|
(0.5
|
)
|
|
0.9
|
|
|
(1.4
|
)
|
|
(156
|
)%
|
|||
Used vehicle gross profit
|
$
|
30.7
|
|
|
$
|
34.5
|
|
|
$
|
(3.8
|
)
|
|
(11
|
)%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
20,287
|
|
|
21,083
|
|
|
(796
|
)
|
|
(4
|
)%
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail revenue
|
$
|
404.5
|
|
|
$
|
426.6
|
|
|
$
|
(22.1
|
)
|
|
(5
|
)%
|
Used vehicle wholesale revenue
|
43.4
|
|
|
47.2
|
|
|
(3.8
|
)
|
|
(8
|
)%
|
|||
Used vehicle revenue
|
$
|
447.9
|
|
|
$
|
473.8
|
|
|
$
|
(25.9
|
)
|
|
(5
|
)%
|
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail gross profit
|
$
|
28.3
|
|
|
$
|
31.8
|
|
|
$
|
(3.5
|
)
|
|
(11
|
)%
|
Used vehicle wholesale gross profit
|
(0.5
|
)
|
|
0.8
|
|
|
(1.3
|
)
|
|
(163
|
)%
|
|||
Used vehicle gross profit
|
$
|
27.8
|
|
|
$
|
32.6
|
|
|
$
|
(4.8
|
)
|
|
(15
|
)%
|
Used vehicle retail units:
|
|
|
|
|
|
|
|
|||||||
Used vehicle retail units
|
18,230
|
|
|
19,510
|
|
|
(1,280
|
)
|
|
(7
|
)%
|
|
For the Three Months Ended March 31,
|
|
Increase (Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
21,985
|
|
|
$
|
21,733
|
|
|
$
|
252
|
|
|
1
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,538
|
|
|
$
|
1,594
|
|
|
$
|
(56
|
)
|
|
(4
|
)%
|
Used vehicle retail gross margin
|
7.0
|
%
|
|
7.3
|
%
|
|
(0.3
|
)%
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Revenue per used vehicle retailed
|
$
|
22,189
|
|
|
$
|
21,866
|
|
|
$
|
323
|
|
|
1
|
%
|
Gross profit per used vehicle retailed
|
$
|
1,552
|
|
|
$
|
1,630
|
|
|
$
|
(78
|
)
|
|
(5
|
)%
|
Used vehicle retail gross margin
|
7.0
|
%
|
|
7.5
|
%
|
|
(0.5
|
)%
|
|
|
|
|
For the Three Months Ended March 31,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
|
(Dollars in millions)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
221.6
|
|
|
$
|
217.6
|
|
|
$
|
4.0
|
|
|
2
|
%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
78.1
|
|
|
77.2
|
|
|
0.9
|
|
|
1
|
%
|
|||
Warranty
|
22.2
|
|
|
21.6
|
|
|
0.6
|
|
|
3
|
%
|
|||
Wholesale parts
|
5.0
|
|
|
6.1
|
|
|
(1.1
|
)
|
|
(18
|
)%
|
|||
Parts and service gross profit, excluding reconditioning and preparation
|
$
|
105.3
|
|
|
$
|
104.9
|
|
|
$
|
0.4
|
|
|
—
|
%
|
Parts and service gross margin, excluding reconditioning and preparation
|
47.5
|
%
|
|
48.2
|
%
|
|
(0.7
|
)%
|
|
|
|
|||
Reconditioning and preparation *
|
$
|
29.6
|
|
|
$
|
30.4
|
|
|
$
|
(0.8
|
)
|
|
(3
|
)%
|
Total parts and service gross profit
|
$
|
134.9
|
|
|
$
|
135.3
|
|
|
$
|
(0.4
|
)
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Parts and service revenue
|
$
|
203.5
|
|
|
$
|
204.6
|
|
|
$
|
(1.1
|
)
|
|
(1
|
)%
|
Parts and service gross profit:
|
|
|
|
|
|
|
|
|||||||
Customer pay
|
72.5
|
|
|
73.3
|
|
|
(0.8
|
)
|
|
(1
|
)%
|
|||
Warranty
|
19.7
|
|
|
20.6
|
|
|
(0.9
|
)
|
|
(4
|
)%
|
|||
Wholesale parts
|
4.6
|
|
|
5.5
|
|
|
(0.9
|
)
|
|
(16
|
)%
|
|||
Parts and service gross profit, excluding reconditioning and preparation
|
$
|
96.8
|
|
|
$
|
99.4
|
|
|
$
|
(2.6
|
)
|
|
(3
|
)%
|
Parts and service gross margin, excluding reconditioning and preparation
|
47.6
|
%
|
|
48.6
|
%
|
|
(1.0
|
)%
|
|
|
|
|||
Reconditioning and preparation *
|
$
|
27.3
|
|
|
$
|
28.0
|
|
|
$
|
(0.7
|
)
|
|
(3
|
)%
|
Total parts and service gross profit
|
$
|
124.1
|
|
|
$
|
127.4
|
|
|
$
|
(3.3
|
)
|
|
(3
|
)%
|
|
For the Three Months Ended March 31,
|
|
Increase
(Decrease)
|
|
%
Change
|
|||||||||
|
2020
|
|
2019
|
|
||||||||||
|
(Dollars in millions, except for per vehicle data)
|
|||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
70.4
|
|
|
$
|
71.5
|
|
|
$
|
(1.1
|
)
|
|
(2
|
)%
|
Finance and insurance, net per vehicle sold
|
$
|
1,666
|
|
|
$
|
1,582
|
|
|
$
|
84
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|||||||
Same Store:
|
|
|
|
|
|
|
|
|||||||
Finance and insurance, net
|
$
|
64.4
|
|
|
$
|
66.2
|
|
|
$
|
(1.8
|
)
|
|
(3
|
)%
|
Finance and insurance, net per vehicle sold
|
$
|
1,688
|
|
|
$
|
1,598
|
|
|
$
|
90
|
|
|
6
|
%
|
|
For the Three Months Ended March 31,
|
|
Increase
(Decrease)
|
|
% of Gross
Profit Increase (Decrease)
|
|||||||||||||||
|
2020
|
|
% of Gross
Profit
|
|
2019
|
|
% of Gross
Profit
|
|
||||||||||||
|
(Dollars in millions)
|
|||||||||||||||||||
As Reported:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
94.9
|
|
|
34.8
|
%
|
|
$
|
92.4
|
|
|
33.1
|
%
|
|
$
|
2.5
|
|
|
1.7
|
%
|
Sales compensation
|
27.4
|
|
|
10.1
|
%
|
|
28.3
|
|
|
10.1
|
%
|
|
(0.9
|
)
|
|
—
|
%
|
|||
Share-based compensation
|
3.5
|
|
|
1.3
|
%
|
|
3.9
|
|
|
1.4
|
%
|
|
(0.4
|
)
|
|
(0.1
|
)%
|
|||
Outside services
|
21.4
|
|
|
7.9
|
%
|
|
19.5
|
|
|
7.0
|
%
|
|
1.9
|
|
|
0.9
|
%
|
|||
Advertising
|
7.4
|
|
|
2.7
|
%
|
|
8.0
|
|
|
2.9
|
%
|
|
(0.6
|
)
|
|
(0.2
|
)%
|
|||
Rent
|
6.8
|
|
|
2.5
|
%
|
|
6.8
|
|
|
2.4
|
%
|
|
—
|
|
|
0.1
|
%
|
|||
Utilities
|
4.1
|
|
|
1.5
|
%
|
|
4.2
|
|
|
1.5
|
%
|
|
(0.1
|
)
|
|
—
|
%
|
|||
Insurance
|
4.1
|
|
|
1.5
|
%
|
|
3.2
|
|
|
1.1
|
%
|
|
0.9
|
|
|
0.4
|
%
|
|||
Other
|
25.1
|
|
|
9.2
|
%
|
|
24.7
|
|
|
8.9
|
%
|
|
0.4
|
|
|
0.3
|
%
|
|||
Selling, general, and administrative expense
|
$
|
194.7
|
|
|
71.5
|
%
|
|
$
|
191.0
|
|
|
68.4
|
%
|
|
$
|
3.7
|
|
|
3.1
|
%
|
Gross profit
|
$
|
272.4
|
|
|
|
|
$
|
279.2
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Same Store:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Personnel costs
|
$
|
86.9
|
|
|
34.8
|
%
|
|
$
|
86.9
|
|
|
33.2
|
%
|
|
$
|
—
|
|
|
1.6
|
%
|
Sales compensation
|
24.8
|
|
|
9.9
|
%
|
|
26.2
|
|
|
10.0
|
%
|
|
(1.4
|
)
|
|
(0.1
|
)%
|
|||
Share-based compensation
|
3.5
|
|
|
1.4
|
%
|
|
3.9
|
|
|
1.5
|
%
|
|
(0.4
|
)
|
|
(0.1
|
)%
|
|||
Outside services
|
19.5
|
|
|
7.8
|
%
|
|
18.1
|
|
|
6.9
|
%
|
|
1.4
|
|
|
0.9
|
%
|
|||
Advertising
|
5.9
|
|
|
2.4
|
%
|
|
7.3
|
|
|
2.8
|
%
|
|
(1.4
|
)
|
|
(0.4
|
)%
|
|||
Rent
|
6.7
|
|
|
2.7
|
%
|
|
6.7
|
|
|
2.6
|
%
|
|
—
|
|
|
0.1
|
%
|
|||
Utilities
|
3.7
|
|
|
1.5
|
%
|
|
3.9
|
|
|
1.5
|
%
|
|
(0.2
|
)
|
|
—
|
%
|
|||
Insurance
|
3.4
|
|
|
1.4
|
%
|
|
2.8
|
|
|
1.1
|
%
|
|
0.6
|
|
|
0.3
|
%
|
|||
Other
|
$
|
24.1
|
|
|
9.6
|
%
|
|
$
|
23.3
|
|
|
8.7
|
%
|
|
0.8
|
|
|
0.9
|
%
|
|
Selling, general, and administrative expense
|
$
|
178.5
|
|
|
71.5
|
%
|
|
$
|
179.1
|
|
|
68.3
|
%
|
|
$
|
(0.6
|
)
|
|
3.2
|
%
|
Gross profit
|
$
|
249.5
|
|
|
|
|
$
|
262.1
|
|
|
|
|
|
|
|
•
|
The Company delivered a notice of special mandatory redemption to holders of its $525.0 million aggregate principal amount of 4.50% senior notes due 2028 (the “2028 Notes”) and $600.0 million aggregate principal amount of 4.75% senior notes due 2030 (the “2030 Notes” and, together with the 2028 Notes, the “Notes”) pursuant to which it redeemed on a pro rata basis (1) $245.0 million of the 2028 Notes and (2) $280.0 million of the 2030 Notes, in each case, at 100% of the respective principal amount plus accrued and unpaid interest to, but excluding the special mandatory redemption date.
|
•
|
The Company did not consummate the transactions contemplated by, or incur indebtedness in connection with, the new real estate term loan credit agreement, dated as of February 7, 2020, by and among various financial institutions party thereto, certain of the Company’s subsidiaries and Bank of America, N.A. (“Bank of America”).
|
•
|
The amendments to the Third Amended and Restated Credit Agreement, dated as of September 25, 2019, among the Company, certain of its subsidiaries, Bank of America and the other lenders thereto (the “2019 Senior Credit Agreement”) to (1) increase the aggregate commitments under the revolving credit facility to $350.0 million, (2) increase the aggregate commitments under the new vehicle floorplan facility to $1.35 billion and (3) increase the aggregate commitments under the used vehicle floorplan facility to $200.0 million did not become effective.
|
•
|
The amended and restated commitment letter, by and among the Company, Bank of America, BofA Securities, Inc., JPMorgan Chase Bank, N.A., Wells Fargo Securities, LLC, Wells Fargo Bank, National Association, Santander Bank, N.A., SunTrust Robinson Humphrey, Inc., Trust Bank and U.S. Bank National Association terminated in accordance with its terms on April 15, 2020.
|
•
|
2019 Senior Credit Facility — On September 25, 2019, the Company and certain of its subsidiaries entered into the third amended and restated credit agreement with Bank of America, as administrative agent, and the other lenders party thereto (the "2019 Senior Credit Facility"). The 2019 Senior Credit Agreement provides for the following:
|
•
|
Manufacturer affiliated new vehicle floor plan and other financing facilities —We have a floor plan facility with the Ford Motor Credit Company ("Ford Credit") to purchase new Ford and Lincoln vehicle inventory. This floor plan facility was amended in December 2019 to extend the maturity date from December 5, 2019 to May 31, 2020. We have also established a floor plan offset account with Ford Credit, which operates in a similar manner to our floor plan offset account with Bank of America. As of March 31, 2020, we had $118.4 million, net of $15.3 million in our floor plan offset account, outstanding under our floor plan facility. Additionally, we had $83.6 million outstanding under facilities with certain manufacturers for the financing of loaner vehicles, which were presented within Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets. Neither our floor plan facility with Ford Credit nor our facilities for loaner vehicles have stated borrowing limitations.
|
•
|
The New Senior Notes—On February 19, 2020, the Company completed its offering of senior unsecured notes, consisting of $525.0 million aggregate principal amount of 4.50% Senior Notes due 2028 (the “2028 Notes”) and $600.0 million aggregate principal amount of 4.75% Senior Notes due 2030 (the “2030 Notes” and, together with the 2028 Notes, the “Notes”). The 2028 Notes and 2030 Notes mature on March 1, 2028 and March 1, 2030, respectively. Interest is payable semiannually, on March 1 and September 1 of each year. The New Senior Notes were offered,
|
•
|
6.0% Senior Subordinated Notes due 2024 — In connection with the issuance of the 2028 Notes and 2030 Notes, on March 4, 2020, we redeemed all of our 6.0% Notes at 103% of par, plus accrued and unpaid interest up to, but excluding, the date of redemption.
|
•
|
Mortgage notes — as of March 31, 2020, we had $99.2 million of mortgage note obligations. These obligations are collateralized by the associated real estate at our dealership locations.
|
•
|
2013 BofA Real Estate Facility— As of March 31, 2020, we had $16.5 million of outstanding borrowings under the 2013 BofA Real Estate Facility. There is no further borrowing availability under this agreement.
|
•
|
2015 Wells Fargo Master Loan Facility—Borrowings under the 2015 Wells Fargo Master Loan Facility (as defined herein) are guaranteed by us and are collateralized by the real property financed under the 2015 Wells Fargo Master Loan Facility. As of March 31, 2020, the outstanding balance under this agreement was $75.5 million. There is no further borrowing availability under this agreement.
|
•
|
2018 Bank of America Facility —On November 13, 2018, the Company and certain of its subsidiaries entered into the 2018 BofA Real Estate Facility (as defined herein) with Bank of America, which provides for term loans in an aggregate amount not to exceed $128.1 million. Our right to make draws under the 2018 BofA Real Estate Facility terminated on November 13, 2019. All of the real property financed by an operating dealership subsidiary of the Company under the 2018 BofA Real Estate Facility is collateralized by first priority liens, subject to certain permitted exceptions. As of March 31, 2020, we had $105.3 million of outstanding borrowings under the 2018 Bank of America Facility.
|
•
|
2018 Wells Fargo Master Loan Facility—On November 16, 2018, certain subsidiaries of the Company entered into a 2018 Wells Fargo Master Loan Agreement (as defined herein) which provides for term loans to certain of the Company's subsidiaries that are borrowers under the 2018 Wells Fargo Master Loan Facility in an aggregate amount not to exceed $100.0 million. Our right to make draws under the 2018 Wells Fargo Master Loan Facility will terminate on June 30, 2020. On November 16, 2018, we borrowed an aggregate amount of $25.0 million under the 2018 Wells Fargo Master Loan Facility, the proceeds of which were used for general corporate purposes. As of March 31, 2020, we had $25.0 million outstanding borrowings under the 2018 Wells Fargo Master Loan Facility.
|
|
For the Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In millions)
|
||||||
Reconciliation of Cash provided by operating activities to Cash provided by operating activities, as adjusted
|
|
|
|
||||
Cash provided by operating activities, as reported
|
$
|
127.7
|
|
|
$
|
65.2
|
|
New vehicle floor plan borrowings —non-trade, net
|
37.2
|
|
|
32.7
|
|
||
Cash provided by operating activities, as adjusted
|
$
|
164.9
|
|
|
$
|
97.9
|
|
|
|
|
|
|
|
|
|
|
Exhibit
Number |
|
Description of Documents
|
|
Indenture relating to the 2028 Notes, dated as of February 19, 2020, by and among Asbury Automotive Group, Inc., the Subsidiary Guarantors listed on Schedule I thereto and U.S. Bank National Association, as Trustee, including the form of note attached as Exhibit A thereto (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
|
|
Form of 4.50% Senior Note due 2028 (included as Exhibit A in Exhibit 4.1 to the Company's Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
|
|
Indenture relating to the 2030 Notes, dated as of February 19, 2020, by and among Asbury Automotive Group, Inc., the Subsidiary Guarantors listed on Schedule I thereto and U.S. Bank National Association, as Trustee, including the form of note attached as Exhibit A thereto (filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
|
|
Form of 4.75% Senior Note due 2030 (included as Exhibit A in Exhibit 4.2 to the Company's Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
|
|
Registration Rights Agreement relating to the 2028 Notes, dated February 19, 2020, among Asbury Automotive Group, Inc., the guarantors party thereto and BofA Securities, Inc., J.P. Morgan Securities, LLC, Wells Fargo Securities, LLC, Santander Investment Securities Inc., SunTrust Robinson Humphrey, Inc. and U.S. Bancorp Investments, Inc. (filed as Exhibit 4.5 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
|
|
Registration Rights Agreement relating to the 2030 Notes, dated February 19, 2020, among Asbury Automotive Group, Inc., the guarantors party thereto and BofA Securities, Inc., J.P. Morgan Securities, LLC, Wells Fargo Securities, LLC, Santander Investment Securities Inc., SunTrust Robinson Humphrey, Inc. and U.S. Bancorp Investments, Inc. (filed as Exhibit 4.6 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
|
|
Credit Agreement, dated February 7, 2020, by and among Asbury Automotive Group, Inc., certain subsidiaries party thereto and Bank of America, N.A (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 13, 2020)*
|
|
|
First Amendment to the Third Amended and Restated Credit Agreement, dated January 31, 2020, among Asbury Automotive Group, Inc., as a borrower, certain of its subsidiaries, as vehicle borrowers, Bank of America, N.A., as administrative agent, revolving swing line lender, new vehicle floorplan swing line lender, used vehicle floorplan swingline lender and an l/c issuer, and the other lenders party thereto, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, N.A., as co-syndication agents, Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, as co-documentation agents, and BofA Securities, Inc. as sole lead arranger and sole bookrunner (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 3, 2020)*
|
|
|
Certificate of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
Certificate of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
Certificate of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
Certificate of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
101.INS
|
|
XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
104
|
|
Cover Page Interactive Data File (formatted in iXBRL Exhibit 101)
|
*
|
|
Incorporated by reference
|
|
|
Asbury Automotive Group, Inc.
|
||
|
|
|
|
|
Date:
|
May 11, 2020
|
By:
|
|
/s/ David W. Hult
|
|
|
Name:
|
|
David W. Hult
|
|
|
Title:
|
|
Chief Executive Officer and President
|
|
|
Asbury Automotive Group, Inc.
|
||
|
|
|
|
|
Date:
|
May 11, 2020
|
By:
|
|
/s/ William F. Stax
|
|
|
Name:
|
|
William F. Stax
|
|
|
Title:
|
|
Interim Principal Financial Officer, Vice President, Controller and Chief Accounting Officer
|
Exhibit
Number |
|
Description of Documents
|
4.1
|
|
Indenture relating to the 2028 Notes, dated as of February 19, 2020, by and among Asbury Automotive Group, Inc., the Subsidiary Guarantors listed on Schedule I thereto and U.S. Bank National Association, as Trustee, including the form of note attached as Exhibit A thereto (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
4.2
|
|
Form of 4.50% Senior Note due 2028 (included as Exhibit A in Exhibit 4.1 to the Company's Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
4.3
|
|
Indenture relating to the 2030 Notes, dated as of February 19, 2020, by and among Asbury Automotive Group, Inc., the Subsidiary Guarantors listed on Schedule I thereto and U.S. Bank National Association, as Trustee, including the form of note attached as Exhibit A thereto (filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
4.4
|
|
Form of 4.75% Senior Note due 2030 (included as Exhibit A in Exhibit 4.2 to the Company's Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
4.5
|
|
Registration Rights Agreement relating to the 2028 Notes, dated February 19, 2020, among Asbury Automotive Group, Inc., the guarantors party thereto and BofA Securities, Inc., J.P. Morgan Securities, LLC, Wells Fargo Securities, LLC, Santander Investment Securities Inc., SunTrust Robinson Humphrey, Inc. and U.S. Bancorp Investments, Inc. (filed as Exhibit 4.5 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
4.6
|
|
Registration Rights Agreement relating to the 2030 Notes, dated February 19, 2020, among Asbury Automotive Group, Inc., the guarantors party thereto and BofA Securities, Inc., J.P. Morgan Securities, LLC, Wells Fargo Securities, LLC, Santander Investment Securities Inc., SunTrust Robinson Humphrey, Inc. and U.S. Bancorp Investments, Inc. (filed as Exhibit 4.6 to the Company’s Current Report on Form 8-K filed with the SEC on February 20, 2020)*
|
10.1
|
|
Credit Agreement, dated February 7, 2020, by and among Asbury Automotive Group, Inc., certain subsidiaries party thereto and Bank of America, N.A (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 13, 2020)*
|
10.2
|
|
First Amendment to the Third Amended and Restated Credit Agreement, dated January 31, 2020, among Asbury Automotive Group, Inc., as a borrower, certain of its subsidiaries, as vehicle borrowers, Bank of America, N.A., as administrative agent, revolving swing line lender, new vehicle floorplan swing line lender, used vehicle floorplan swingline lender and an l/c issuer, and the other lenders party thereto, JPMorgan Chase Bank, N.A. and Wells Fargo Bank, N.A., as co-syndication agents, Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, as co-documentation agents, and BofA Securities, Inc. as sole lead arranger and sole bookrunner (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 3, 2020)*
|
31.1
|
|
Certificate of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2
|
|
Certificate of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1
|
|
Certificate of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2
|
|
Certificate of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.INS
|
|
XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
104
|
|
Cover Page Interactive Data File (formatted in iXBRL Exhibit 101)
|
*
|
|
Incorporated by reference
|
1 Year Asbury Automotive Chart |
1 Month Asbury Automotive Chart |
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