Declares Dividend of $0.31 Per Share for
Third Quarter
Lithia Motors, Inc. (NYSE: LAD) today reported the highest third
quarter revenue and earnings per share in company history.
Third quarter 2020 revenue increased 9% to $3.6 billion from
$3.3 billion in the third quarter of 2019.
Third quarter 2020 net income per diluted share was $6.86, an
88% increase from $3.64 per diluted share reported in the third
quarter of 2019. Adjusted third quarter 2020 net income per diluted
share was $6.89, a 103% increase compared to adjusted net income of
$3.39 per diluted share in the same period of 2019.
Third quarter 2020 net income was $159 million, an 86% increase
compared to net income of $85 million in the same period of 2019.
Adjusted third quarter 2020 net income was $160 million, a 101%
increase compared to adjusted net income of $79 million for the
same period of 2019.
As shown in the attached non-GAAP reconciliation tables, the
2020 third quarter adjusted results exclude a $0.03 net non-core
charge related to insurance reserves and acquisition expenses. The
2019 third quarter adjusted results exclude a $0.25 net non-core
benefit due to a net gain on sale of stores, partially offset by
insurance reserves and acquisition expenses.
Third Quarter-over-Quarter Operating Highlights:
- Total company revenues increased 8.6%
- Same store used vehicle retail sales increased 11.2%
- Same store F&I per unit increased 9.8% to $1,617
- Same store total vehicle gross profit per unit increased 28.0%
to $4,690
- Adjusted SG&A as a percentage of gross profit improved by
920 basis points to 59.6%
"Our strong used vehicle performance and sequential improvements
in service, body and parts throughout the quarter, coupled with our
strategic cost saving measures taken earlier in the year, led us to
the highest quarterly earnings per share in our company's history,
more than doubling our adjusted earnings per share compared to the
third quarter of last year," said Bryan DeBoer, President and CEO.
"This record performance and profitability demonstrate the high
performance being achieved at our existing stores and only the very
beginning of the benefits to be realized through the activation of
Driveway, our ecommerce digital home solution."
For the first nine months of 2020 revenues decreased 2% to $9.2
billion, compared to $9.4 billion in 2019.
Net income for the first nine months of 2020 was $12.18 per
diluted share, compared to $8.72 per diluted share in 2019, an
increase of 40%. Adjusted net income per diluted share for the
first nine months of 2020 increased 43% to $12.59 from $8.81 in the
same period of 2019.
Corporate Development
During the quarter, we announced the acquisitions of San
Francisco BMW, the John Eagle Auto Group in Texas and a Chrysler
Jeep Dodge Ram store in Knoxville, Tennessee. In addition, earlier
this month we completed the acquisition of Latham Ford in the
Albany, New York area. These acquisitions are anticipated to
generate $1.46 billion in annualized steady state revenues. For the
year, this brings our total anticipated annualized revenue from
acquired locations to $1.75 billion and expands our density in key
geographic areas.
Balance Sheet Update
We ended the third quarter with over $694 million in cash and
availability on our revolving lines of credit.
Earlier this month, we raised $805 million of gross proceeds
through to the sale of 3,659,091 shares of Class A common stock, no
par value per share, which includes the exercise in full by the
Underwriters of their option to purchase up to 477,272 additional
shares of Class A common stock. Concurrently, we completed an
issuance of $550 million in aggregate principal amount of 4.375%
senior notes due 2031 in a private offering that is exempt from the
registration requirements of the Securities Act of 1933, as
amended. We intend to use the net proceeds for general corporate
purposes, which may include financing acquisitions, capital
expenditures, working capital and repaying or refinancing debt.
Together, this brings our current total cash and available
credit to over $2 billion. In addition, our unfinanced real estate
could provide additional liquidity of approximately $225
million.
"With the significant amount of capital raised in October, we
continue to accelerate the build out of our coast-to-coast network,
expanding our ability to provide consumers with convenient,
affordable solutions throughout their vehicle ownership lifecycle,"
said DeBoer. "Together, with our Driveway digital home channel, we
are providing the most transparent and comprehensive offerings
wherever, whenever and however consumers desire."
Dividend Payment
Our Board of Directors approved a dividend of $0.31 per share
related to third quarter 2020 financial results. We expect to pay
the dividend on November 27, 2020 to shareholders of record on
November 13, 2020.
Third Quarter Earnings Conference Call and Updated
Presentation
The third quarter 2020 conference call may be accessed at 10:00
a.m. ET today by telephone at 877-407-8029. An updated presentation
highlighting the third quarter 2020 results has been added to our
investor relations website. To listen live on our website or for
replay, visit www.lithiainvestorrelations.com and click on
webcasts.
About Lithia
Lithia Motors, Inc. is a growth company powered by people and
innovation with a 5-year plan to profitably consolidate the largest
retail sector in the country. They are a leading provider of
personal transportation solutions in the United States and are
among the fastest-growing companies in the Fortune 500 (#6 on
10-Year EPS Growth, #4 10-Year TSR in 2020). By providing a wide
array of products throughout the entire lifecycle of the consumer's
vehicle ownership experience, they build magnetic brand loyalty.
Operational excellence is achieved by focusing the business on
convenient and transparent consumer experiences supported by
proprietary data science to increase market share, consumer loyalty
and team performance. Lithia's omni-channel strategy will continue
to pragmatically disrupt the industry by leveraging experienced
teams, vast owned inventories, technology, and its physical
network. By purchasing strong businesses, they further strengthen
this network, leveraging their national digital home channel
Driveway and building upon their massive regenerating capital
engine. Together, these endeavors create a unique and compelling
high-growth strategy that provides transportation solutions
wherever, whenever and however consumers desire.
Sites www.lithia.com
www.lithiainvestorrelations.com www.lithiacareers.com
www.driveway.com
Lithia Motors on Facebook http://www.facebook.com/LithiaMotors
Lithia Motors on Twitter http://twitter.com/lithiamotors
Forward-Looking Statements
Certain statements in this presentation, and at times made by
our officers and representatives, constitute forward-looking
statements within the meaning of the "Safe Harbor" provisions of
the Private Securities Litigation Reform Act of 1995. Generally,
you can identify forward-looking statements by terms such as
"project", "outlook", "target", "may", "will", "would", "should",
"seek", "expect", "plan", "intend", "forecast", "anticipate",
"believe", "estimate", "predict", "potential", "likely", "goal",
"strategy", "future", "maintain", and "continue" or the negative of
these terms or other comparable terms. Examples of forward-looking
statements in this presentation include, among others, statements
regarding:
- Future market conditions, including anticipated car sales
levels;
- Anticipated impacts on consumer demand or governmental
restrictions related to the COVID-19 pandemic or otherwise;
- Expected level of business interruption due to shelter in place
policies or lifting of those restrictions, and when volumes and
consumer demand will return;
- Continuation of our sales and services, including in-store
appointments and home deliveries;
- Expected growth from our ecommerce home solutions and digital
strategies;
- Expected operating results, such as improved store performance;
continued improvement of selling, general and administrative
expenses ("SG&A") as a percentage of gross profit and all
projections;
- Anticipated integration, success and growth of acquired
stores;
- Anticipated ability to capture additional market share;
- Anticipated ability to find accretive acquisitions;
- Expected revenues from acquired stores;
- Anticipated synergies, ability to monetize our investment in
digital innovation;
- Anticipated additions of dealership locations to our portfolio
in the future;
- Anticipated financial condition and liquidity, including from
our cash, availability on our credit facility and unfinanced real
estate;
- Anticipated use of proceeds from our financings;
- Anticipated allocations, uses and levels of capital
expenditures in the future;
- Expectations regarding compliance with financial and
restrictive covenants in our credit facility and other debt
agreements;
- Statements regarding furloughed employees and cost reductions;
and
- Our strategies for customer retention, growth, market position,
financial results and risk management.
Because forward-looking statements relate to the future, they
are subject to inherent uncertainties, risks and changes in
circumstances that are difficult to predict and many of which are
outside of our control. Forward-looking statements are not
guarantees of future performance, and our actual results of
operations, financial condition and liquidity and development of
the industry in which we operate may differ materially from those
made in or suggested by the forward-looking statements in this
presentation. Therefore, you should not rely on any of these
forward-looking statements. The risks and uncertainties that could
cause actual results to differ materially from estimated or
projected results include, without limitation:
- Future economic and financial conditions (both nationally and
locally), including as a result of the COVID-19 pandemic;
- Changes in customer demand, our relationship with, and the
financial and operational stability of, vehicle manufacturers and
other suppliers;
- Risks associated with our indebtedness (including available
borrowing capacity, compliance with financial covenants and ability
to refinance or repay indebtedness on favorable terms);
- The adequacy of our cash flow and earnings and other conditions
which may affect our ability to pay our quarterly dividend at the
planned level;
- Disruptions to our technology network including computer
systems and software, as well as natural events such as severe
weather, fires, floods and earthquakes or man-made or other
disruptions of our operating systems, structures, facilities or
equipment; and
- Government regulations and legislation, and other risks set
forth throughout "Part II, Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations" and in
"Part I, Item 1A. Risk Factors" of our most recent Annual Report on
Form 10-K, and in "Part II, Item 1A. Risk Factors" of our Quarterly
Reports on Form 10-Q, and from time to time in our other filings
with the SEC.
Any forward-looking statement made by us in this presentation is
based only on information currently available to us and speaks only
as of the date on which it is made. Except as required by law, we
undertake no obligation to publicly update any forward-looking
statement, whether written or oral, that may be made from time to
time, whether as a result of new information, future developments
or otherwise.
Non-GAAP Financial Measures
This presentation contains non-GAAP financial measures such as
adjusted net income and diluted earnings per share, adjusted
SG&A as a percentage of revenue and gross profit, adjusted
operating margin, adjusted operating profit as a percentage of
revenue and gross profit, adjusted pre-tax margin and net profit
margin, EBITDA, adjusted EBITDA, leveraged EBITDA and adjusted
total debt. Non-GAAP measures do not have definitions under GAAP
and may be defined differently by and not comparable to similarly
titled measures used by other companies. As a result, we review any
non-GAAP financial measures in connection with a review of the most
directly comparable measures calculated in accordance with GAAP. We
caution you not to place undue reliance on such non-GAAP measures,
but also to consider them with the most directly comparable GAAP
measures. We present cash flows from operations in the attached
tables, adjusted to include the change in non-trade floor plan debt
to improve the visibility of cash flows related to vehicle
financing. As required by SEC rules, we have reconciled these
measures to the most directly comparable GAAP measures in the
attachments to this release. We believe the non-GAAP financial
measures we present improve the transparency of our disclosures;
provide a meaningful presentation of our results from core business
operations, because they exclude items not related to core business
operations and other non-cash items; and improve the
period-to-period comparability of our results from core business
operations. These presentations should not be considered an
alternative to GAAP measures.
Lithia Motors, Inc.
Consolidated Statements of
Operations (Unaudited)
(In millions except per share data)
Three months ended September
30,
%
Nine months ended September
30,
%
Increase
Increase
2020
2019
(Decrease)
2020
2019
(Decrease)
Revenues:
New vehicle retail
$
1,883.3
$
1,824.8
3.2
%
$
4,624.6
$
4,993.3
(7.4
)%
Used vehicle retail
1,093.2
916.3
19.3
2,889.7
2,632.4
9.8
Used vehicle wholesale
98.8
74.4
32.8
216.8
233.5
(7.2
)
Finance and insurance
160.5
136.3
17.8
407.2
382.7
6.4
Service, body and parts
359.5
340.5
5.6
964.9
993.3
(2.9
)
Fleet and other
24.9
40.1
(37.9
)
79.3
168.6
(53.0
)
Total revenues
3,620.2
3,332.4
8.6
%
9,182.5
9,403.8
(2.4
)%
Cost of sales:
New vehicle retail
1,743.2
1,724.8
1.1
4,314.2
4,711.9
(8.4
)
Used vehicle retail
948.4
816.6
16.1
2,556.8
2,355.0
8.6
Used vehicle wholesale
91.2
73.3
24.4
206.5
229.7
(10.1
)
Service, body and parts
163.6
169.0
(3.2
)
456.5
492.2
(7.3
)
Fleet and other
22.2
37.8
(41.3
)
71.6
159.8
(55.2
)
Total cost of sales
2,968.6
2,821.5
5.2
7,605.6
7,948.6
(4.3
)
Gross profit
651.6
510.9
27.5
%
1,576.9
1,455.2
8.4
%
Asset impairments
—
—
NM
7.9
0.5
NM
SG&A expense
389.1
343.2
13.4
1,039.6
1,021.5
1.8
Depreciation and amortization
22.9
20.9
9.6
67.3
60.9
10.5
Income from operations
239.6
146.8
63.2
%
462.1
372.3
24.1
%
Floor plan interest expense
(6.1
)
(17.9
)
(65.9
)
(28.3
)
(55.5
)
(49.0
)
Other interest expense
(16.6
)
(14.8
)
12.2
(50.4
)
(45.0
)
12.0
Other income, net
2.2
3.3
NM
8.2
8.9
NM
Income before income taxes
219.1
117.4
86.6
%
391.6
280.7
39.5
%
Income tax expense
(60.3
)
(32.2
)
87.3
(108.9
)
(77.2
)
41.1
Income tax rate
27.5
%
27.4
%
27.8
%
27.5
%
Net income
$
158.8
$
85.2
86.4
%
$
282.7
$
203.5
38.9
%
Diluted net income per share:
Net income per share
$
6.86
$
3.64
88.5
%
$
12.18
$
8.72
39.7
%
Diluted shares outstanding
23.1
23.4
(1.3
)%
23.2
23.3
(0.4
)%
NM - not meaningful
Lithia Motors, Inc.
Key Performance Metrics
(Unaudited)
Three months ended September
30,
%
Nine months ended September
30,
%
Increase
Increase
2020
2019
(Decrease)
2020
2019
(Decrease)
Gross
margin
New vehicle retail
7.4
%
5.5
%
190
bps
6.7
%
5.6
%
110
bps
Used vehicle retail
13.2
10.9
230
11.5
10.5
100
Finance and insurance
100.0
100.0
—
100.0
100.0
—
Service, body and parts
54.5
50.5
400
52.7
50.4
230
Gross profit margin
18.0
15.3
270
17.2
15.5
170
Unit
sales
New vehicle retail
47,923
48,508
(1.2
)%
118,699
134,090
(11.5
)%
Used vehicle retail
49,363
44,143
11.8
135,499
127,683
6.1
Total retail units sold
97,286
92,651
5.0
254,198
261,773
(2.9
)
Average selling
price
New vehicle retail
$
39,298
$
37,618
4.5
%
$
38,960
$
37,238
4.6
%
Used vehicle retail
22,145
20,756
6.7
21,326
20,617
3.4
Average gross
profit per unit
New vehicle retail
$
2,922
$
2,061
41.8
%
$
2,615
$
2,098
24.6
%
Used vehicle retail
2,932
2,258
29.8
2,457
2,173
13.1
Finance and insurance
1,649
1,471
12.1
1,602
1,462
9.6
Total vehicle(1)
4,655
3,638
28.0
4,173
3,611
15.6
Revenue
mix
New vehicle retail
52.0
%
54.8
%
50.4
%
53.1
%
Used vehicle retail
30.2
27.5
31.5
28.0
Used vehicle wholesale
2.7
2.2
2.4
2.5
Finance and insurance, net
4.4
4.1
4.4
4.1
Service, body and parts
9.9
10.2
10.5
10.6
Fleet and other
0.8
1.2
0.8
1.7
Gross Profit
Mix
New vehicle retail
21.5
%
19.6
%
19.7
%
19.3
%
Used vehicle retail
22.2
19.5
21.1
19.1
Used vehicle wholesale
1.2
0.2
0.7
0.3
Finance and insurance, net
24.6
26.7
25.8
26.3
Service, body and parts
30.1
33.5
32.2
34.4
Fleet and other
0.4
0.5
0.5
0.6
Adjusted
As reported
Adjusted
As reported
Three months ended September
30,
Three months ended September
30,
Nine months ended September
30,
Nine months ended September
30,
Other
metrics
2020
2019
2020
2019
2020
2019
2020
2019
SG&A as a % of revenue
10.7
%
10.5
%
10.7
%
10.3
%
11.3
%
10.8
%
11.3
%
10.9
%
SG&A as a % of gross profit
59.6
68.8
59.7
67.2
65.5
70.0
65.9
70.2
Operating profit as a % of revenue
6.6
4.2
6.6
4.4
5.2
4.0
5.0
4.0
Operating profit as a % of gross
profit
36.9
27.1
36.8
28.7
30.2
25.8
29.3
25.6
Pretax margin
6.1
3.3
6.1
3.5
4.4
3.0
4.3
3.0
Net profit margin
4.4
2.4
4.4
2.6
3.2
2.2
3.1
2.2
(1) Includes the sales and gross profit
related to new, used retail, used wholesale and finance and
insurance and unit sales for new and used retail
Lithia Motors, Inc.
Same Store Operating Highlights
(Unaudited)
Three months ended September
30,
%
Nine months ended September
30,
%
Increase
Increase
2020
2019
(Decrease)
2020
2019
(Decrease)
Revenues
New vehicle retail
$
1,714.1
$
1,793.7
(4.4
)%
$
4,265.0
$
4,886.6
(12.7
)%
Used vehicle retail
998.3
897.9
11.2
2,693.9
2,566.4
5.0
Finance and insurance
142.5
133.7
6.6
372.9
373.7
(0.2
)
Service, body and parts
324.3
334.1
(2.9
)
891.5
966.4
(7.8
)
Total revenues
3,294.7
3,272.7
0.7
8,501.1
9,185.4
(7.4
)
Gross
profit
New vehicle retail
$
130.0
$
98.9
31.4
%
$
287.8
$
276.5
4.1
%
Used vehicle retail
133.9
98.7
35.7
309.6
273.0
13.4
Finance and insurance
142.5
133.7
6.6
372.9
373.7
(0.2
)
Service, body and parts
174.9
168.3
3.9
467.7
488.4
(4.2
)
Total gross profit
591.0
503.1
17.5
1,455.4
1,424.2
2.2
Gross
margin
New vehicle retail
7.6
%
5.5
%
210
bps
6.7
%
5.7
%
100
bps
Used vehicle retail
13.4
11.0
240
11.5
10.6
90
Finance and insurance
100.0
100.0
—
100.0
100.0
—
Service, body and parts
53.9
50.4
350
52.5
50.5
200
Gross profit margin
17.9
15.4
250
17.1
15.5
160
Unit
sales
New vehicle retail
43,029
47,548
(9.5
)%
108,370
130,721
(17.1
)%
Used vehicle retail
45,066
43,180
4.4
126,160
124,147
1.6
Average selling
price
New vehicle retail
$
39,836
$
37,725
5.6
%
$
39,356
$
37,382
5.3
%
Used vehicle retail
22,151
20,794
6.5
21,353
20,672
3.3
Average gross
profit per unit
New vehicle retail
$
3,022
$
2,079
45.4
%
$
2,656
$
2,115
25.6
%
Used vehicle retail
2,971
2,286
30.0
2,454
2,199
11.6
Finance and insurance
1,617
1,473
9.8
1,590
1,466
8.5
Total vehicle(1)
4,690
3,663
28.0
4,178
3,637
14.9
(1) Includes the sales and gross profit
related to new, used retail, used wholesale and finance and
insurance and unit sales for new and used retail
Lithia Motors, Inc.
Other Highlights (Unaudited)
As of
September 30,
December 31,
September 30,
2020
2019
2019
Days
Supply(1)
New vehicle inventory
50
71
77
Used vehicle inventory
64
65
67
(1) Days supply calculated based on
current inventory levels, excluding in-transit vehicles, and a
30-day historical cost of sales level.
Financial
covenants
Requirement
As of September 30,
2020
Current ratio
Not less than 1.10 to 1
1.38 to 1
Fixed charge coverage ratio
Not less than 1.20 to 1
3.33 to 1
Leverage ratio
Not more than 5.75 to 1
2.33 to 1
Lithia Motors, Inc.
Condensed Consolidated Balance
Sheets (Unaudited)
(In millions)
September 30, 2020
December 31, 2019
Cash and cash equivalents
$
57.1
$
84.0
Trade receivables, net
511.7
505.0
Inventories, net
2,128.7
2,433.7
Other current assets
52.9
47.8
Total current assets
$
2,750.4
$
3,070.5
Property and equipment, net
1,798.3
1,611.7
Intangibles
947.7
761.3
Other non-current assets
899.3
640.4
Total assets
$
6,395.7
$
6,083.9
Floor plan notes payable
1,603.5
2,067.6
Other current liabilities
608.9
501.5
Total current liabilities
$
2,212.4
$
2,569.1
Long-term debt
1,799.0
1,430.6
Other long-term liabilities and deferred
revenue
689.9
616.5
Total liabilities
$
4,701.3
$
4,616.2
Stockholder's Equity
1,694.4
1,467.7
Total liabilities & stockholders'
equity
$
6,395.7
$
6,083.9
Lithia Motors, Inc.
Summarized Cash Flow from
Operations (Unaudited)
(In millions)
Nine months ended September
30,
2020
2019
Net income
$
282.7
$
203.5
Adjustments to reconcile net income to net
cash provided by operating activities:
Asset impairments
7.9
0.5
Depreciation and amortization
67.3
60.9
Stock-based compensation
17.2
11.8
Gain on disposal of assets
(0.5
)
—
Gain on sale of franchises
(1.4
)
(9.1
)
Deferred income taxes
6.8
39.5
(Increase) decrease:
Trade receivables, net
(11.3
)
69.7
Inventories
457.0
(4.1
)
Other assets
7.8
22.3
Increase (decrease):
Floor plan notes payable, net
(128.0
)
83.1
Trade payables
25.0
0.1
Accrued liabilities
23.6
(36.5
)
Other long-term liabilities and deferred
revenue
46.5
11.8
Net cash provided by operating
activities
$
800.6
$
453.5
Lithia Motors, Inc.
Reconciliation of Non-GAAP Cash Flow
from Operations (Unaudited)
(In millions)
Nine months ended September
30,
Net cash provided by
operating activities
2020
2019
As reported
$
800.6
$
453.5
Floor plan notes payable, non-trade,
net
(317.8
)
(114.0
)
Less: Borrowings on floor plan notes
payable, non-trade associated with acquired new vehicle
inventory
(133.6
)
(46.0
)
Adjusted
$
349.2
$
293.5
Lithia Motors, Inc.
Reconciliation of Certain Non-GAAP
Financial Measures (Unaudited)
(In millions, except for per share
data)
Three Months Ended September
30, 2020
As reported
Insurance reserves
Acquisition expenses
Adjusted
Selling, general and administrative
$
389.1
$
(0.3
)
$
(0.6
)
$
388.2
Operating income
239.6
0.3
0.6
240.5
Income before income taxes
219.1
0.3
0.6
220.0
Income tax (provision) benefit
(60.3
)
—
(0.1
)
(60.4
)
Net income
$
158.8
$
0.3
$
0.5
$
159.6
Diluted earnings per share
$
6.86
$
0.01
$
0.02
$
6.89
Diluted share count
23.1
Three Months Ended September
30, 2019
As reported
Disposal gain on sale of
stores
Insurance reserves
Acquisition expenses
Adjusted
Selling, general and administrative
$
343.2
$
9.4
$
(1.1
)
$
(0.2
)
$
351.3
Operating income
146.8
(9.4
)
1.1
0.2
138.7
Income before income taxes
117.4
(9.4
)
1.1
0.2
109.3
Income tax (provision) benefit
(32.2
)
2.7
(0.3
)
(0.1
)
(29.9
)
Net income
$
85.2
$
(6.7
)
$
0.8
$
0.1
$
79.4
Diluted earnings per share
$
3.64
$
(0.28
)
$
0.03
$
—
$
3.39
Diluted share count
23.4
Lithia Motors, Inc.
Reconciliation of Certain Non-GAAP
Financial Measures (Unaudited)
(In millions, except for per share
data)
Nine Months Ended September
30, 2020
As reported
Disposal gain on sale of
stores
Asset impairment
Insurance reserves
Acquisition expenses
Tax attribute
Adjusted
Asset impairments
$
7.9
$
—
$
(7.9
)
$
—
$
—
$
—
$
—
Selling, general and administrative
1,039.6
1.4
—
(6.1
)
(1.6
)
—
1,033.3
Operating income
462.1
(1.4
)
7.9
6.1
1.6
—
476.3
Income before income taxes
391.6
(1.4
)
7.9
6.1
1.6
—
405.8
Income tax (provision) benefit
(108.9
)
0.4
(2.3
)
(1.6
)
(0.4
)
(0.8
)
(113.6
)
Net income
$
282.7
$
(1.0
)
$
5.6
$
4.5
$
1.2
$
(0.8
)
$
292.2
Diluted earnings per share
$
12.18
$
(0.04
)
$
0.24
$
0.19
$
0.05
$
(0.03
)
$
12.59
Diluted share count
23.2
Nine Months Ended September
30, 2019
As reported
Disposal gain on sale of
stores
Asset impairment
Insurance reserves
Acquisition expenses
Adjusted
Asset impairments
$
0.5
$
—
$
(0.5
)
$
—
$
—
$
—
Selling, general and administrative
1,021.5
9.1
—
(9.5
)
(1.9
)
1,019.2
Operating income
372.3
(9.1
)
0.5
9.5
1.9
375.1
Income before income taxes
280.7
(9.1
)
0.5
9.5
1.9
283.5
Income tax (provision) benefit
(77.2
)
2.6
(0.1
)
(2.6
)
(0.5
)
(77.8
)
Net income
$
203.5
$
(6.5
)
$
0.4
$
6.9
$
1.4
$
205.7
Diluted earnings per share
$
8.72
$
(0.28
)
$
0.02
$
0.29
$
0.06
$
8.81
Diluted share count
23.3
Lithia Motors, Inc.
Adjusted EBITDA and Net Debt to
Adjusted EBITDA (Unaudited)
(In millions)
Three months ended September
30,
%
Nine months ended September
30,
%
Increase
Increase
2020
2019
(Decrease)
2020
2019
(Decrease)
EBITDA and
Adjusted EBITDA
Net income
$
158.8
$
85.2
86.4
%
$
282.7
$
203.5
38.9
%
Flooring interest expense
6.1
17.9
(65.9
)
28.3
55.5
(49.0
)
Other interest expense
16.6
14.8
12.2
50.4
45.0
12.0
Income tax expense
60.3
32.2
87.3
108.9
77.2
41.1
Depreciation and amortization
22.9
20.9
9.6
67.3
60.9
10.5
EBITDA
$
264.7
$
171.0
54.8
%
$
537.6
$
442.1
21.6
%
Other adjustments:
Less: flooring interest expense
$
(6.1
)
$
(17.9
)
(65.9
)
$
(28.3
)
$
(55.5
)
(49.0
)
Less: used vehicle line of credit
interest
(0.1
)
(1.2
)
(91.7
)
(0.5
)
(3.9
)
(87.2
)
Add: acquisition expenses
0.6
0.2
200.0
1.6
1.9
(15.8
)
Less: gain on divestitures
—
(9.4
)
(100.0
)
(1.4
)
(9.1
)
(84.6
)
Add: insurance reserve
0.3
1.1
(72.7
)
6.1
9.5
(35.8
)
Add: asset impairment
—
—
NM
7.9
0.5
NM
Adjusted EBITDA
$
259.4
$
143.8
80.4
%
$
523.0
$
385.5
35.7
%
NM - not meaningful
As of
%
September 30,
Increase
Net Debt to
Adjusted EBITDA
2020
2019
(Decrease)
Floor plan notes payable: non-trade
$
1,293.2
$
1,594.5
(18.9
)%
Floor plan notes payable
310.3
407.5
(23.9
)
Used and service loaner vehicle inventory
financing facility
357.0
332.0
7.5
Revolving lines of credit
35.0
69.0
NM
Real estate mortgages
628.8
585.1
7.5
5.250% Senior notes due 2025
300.0
300.0
—
4.625% Senior notes due 2027
400.0
—
NM
Other debt
147.5
33.5
340.3
Unamortized debt issuance costs
(12.8
)
(5.5
)
132.7
Total debt
$
3,459.0
$
3,316.1
4.3
%
Less: Floor plan related debt
$
(1,960.5
)
$
(2,334.0
)
(16.0
)%
Less: Cash and cash equivalents
(57.1
)
(27.1
)
110.7
Less: Availability on used vehicle and
service loaner financing facility
(72.0
)
—
NM
Net Debt
$
1,369.4
$
955.0
43.4
%
TTM Adjusted EBITDA
$
655.3
$
498.6
31.4
%
Net debt to Adjusted EBITDA
2.09
x
1.92
x
8.9
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201021005301/en/
Eric Pitt VP, Investor Relations and Treasurer EPitt@lithia.com
(541) 864-1748
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