Lithia & Driveway (LAD) Reports Record Third Quarter Revenue of $9.2 billion, an 11% Increase
Announces Dividend of $0.53 per Share for Third Quarter
MEDFORD, Ore., Oct. 23, 2024 /PRNewswire/ -- Lithia & Driveway (NYSE: LAD) today reported the highest third quarter revenue in company history and the second profitable quarter for Financing Operations, which includes Driveway Finance Corporation.
Third quarter 2024 revenue increased 11% to $9.2 billion from $8.3 billion in the third quarter of 2023.
Third quarter 2024 diluted earnings per share attributable to LAD was $7.80, an 18% decrease from $9.46 per share reported in the third quarter of 2023. Third quarter 2024 adjusted diluted earnings per share attributable to LAD was $8.21, an 11% decrease compared to $9.22 per share in the same period of 2023. Unrealized investment gains and foreign currency exchange gains positively impacted diluted earnings per share by $0.11.
Third quarter 2024 net income was $223 million, a 16% decrease compared to net income of $265 million in the same period of 2023. Adjusted third quarter 2024 net income was $222 million, a 14% decrease compared to adjusted net income of $258 million for the same period of 2023.
As shown in the attached non-GAAP reconciliation tables, the 2024 third quarter adjusted results exclude a $0.41 per diluted share impact resulting from non-core items, including a premium paid for the redemption of the remaining non-controlling interest in Pfaff Automotive and acquisition expenses, partially offset by a net gain on the disposal of stores and tax attributes. The 2023 third quarter adjusted results exclude a $0.24 per diluted share impact resulting from non-core items, including a net gain on the disposal of stores, partially offset by acquisition expenses, insurance reserves, and one-time contract buyouts.
Key Third Quarter 2024 Highlights:
-- Total revenues increased 11% compared to third quarter 2023
-- Aftersales gross profit increased 6.3% on a same-store basis
-- Financing operations continued profitability with quarterly income of $1
million
-- Driveway Finance Corporation (DFC) originated $518 million in loans, for
a total portfolio of $3.8 billion, and priced a $615 million ABS
offering in October, our ninth securitization
-- Repurchased 0.7% of outstanding shares
"Our third quarter performance was strong and demonstrated the team's ability to grow our business, leveraging size and scale and seizing new opportunities while focusing on operational efficiency. Our core businesses showed consistent growth while delivering substantial cost savings, and our adjacent operations continued building momentum, positioning us well for the future," said Bryan DeBoer, President and CEO. "Our diversified model continues to strengthen our market position, driving shareholder value. We remain committed to creating customer loyalty through exceptional experiences and operational excellence across our omnichannel ecosystem."
For the first nine months of 2024 revenues increased 16% to $27.0 billion, compared to $23.4 billion in 2023.
Diluted earnings per share attributable to LAD for the first nine months of 2024 was $21.54, compared to $28.54 per share in 2023, a decrease of 25%. Adjusted diluted earnings per share attributable to LAD for the first nine months of 2024 decreased 23% to $22.17 from $28.61 in the same period of 2023. Unrealized gain on investments partially offset by foreign currency exchange losses for the first nine months of 2024 positively impacted diluted earnings per share by $0.74.
Corporate Development
During the third quarter, LAD continued to expand its network in the Southeast region with the acquisition of three stores from the Duval Motor Company in Jacksonville and Gainesville, Florida. These additions will strengthen LAD's import and luxury store footprint in Florida and increase the geographic reach of the Company's retail network.Year-to-date, LAD acquired over $5.9 billion in annualized revenues.
Balance Sheet Update
LAD ended the third quarter with approximately $1.1 billion in cash and cash equivalents, marketable securities, and availability on our revolving lines of credit. In addition, unfinanced real estate could provide additional liquidity of approximately $0.4 billion.
Dividend Payment and Share Repurchases
The Board of Directors approved a dividend of $0.53 per share related to third quarter 2024 financial results. The dividend is expected to be paid on November 15, 2024 to shareholders of record on November 8, 2024.
During 2024, we repurchased approximately 986,000 shares at a weighted average price of $260. Under the current share repurchase authorization approximately $560.9 million remains available.
Third Quarter Earnings Conference Call and Updated Presentation
The third quarter 2024 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 2024 results has been added to our investor relations website. To listen live on our website or for replay, visit investors.lithiadriveway.com and click on quarterly earnings.
About Lithia & Driveway (LAD)
Lithia & Driveway (NYSE: LAD) is one of the largest global automotive retailers providing a wide array of products and services throughout the vehicle ownership lifecycle. Simple, convenient, and transparent experiences are offered through our comprehensive network of physical locations, e-commerce platforms, captive finance solutions, fleet management offerings, and other synergistic adjacencies. We deliver consistent, profitable growth in a massive and unconsolidated industry. Our highly diversified and competitively differentiated design provides us the flexibility and scale to pursue our vision to modernize personal transportation solutions wherever, whenever and however consumers desire.
Sites
www.lithia.com
investors.lithiadriveway.com
www.lithiacareers.com
www.driveway.com
www.greencars.com
www.drivewayfinancecorp.com
Lithia & Driveway on Facebook
https://www.facebook.com/LithiaMotors
https://www.facebook.com/DrivewayHQ
Lithia & Driveway on Twitter
https://x.com/lithiamotors
https://x.com/DrivewayHQ
https://x.com/GreenCarsHQ
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 and other sales
levels and the supply of inventory
-- Our business strategy and plans, including our achieving our long-term
EPS and other financial targets
-- The growth, expansion, make-up and success of our network, including our
finding accretive acquisitions that meet our target valuations and
acquiring additional stores
-- Annualized revenues from acquired stores or achieving target returns
-- The growth and performance of our Driveway e-commerce home solution and
Driveway Finance Corporation (DFC), their synergies and other impacts on
our business and our ability to meet Driveway and DFC-related targets
-- The impact of sustainable vehicles and other market and regulatory
changes on our business
-- Our capital allocations and uses and levels of capital expenditures in
the future
-- Expected operating results, such as improved store performance,
continued improvement of selling, general and administrative expenses as
a percentage of gross profit and any projections
-- Our anticipated financial condition and liquidity, including from our
cash and the future availability of our credit facilities, unfinanced
real estate and other financing sources
-- Our continuing to purchase shares under our share repurchase program
-- Our compliance with financial and restrictive covenants in our credit
facilities and other debt agreements
-- Our programs and initiatives for employee recruitment, training, and
retention
-- Our strategies and targets for customer retention, growth, market
position, operations, 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 national and local economic and financial conditions, including
as a result of regional or global public health issues, inflation and
governmental programs, and spending
-- The market for dealerships, including the availability of stores to us
for an acceptable price
-- Changes in customer demand, our relationship with, and the financial and
operational stability of, OEMs and other suppliers
-- Changes in the competitive landscape, including through technology and
our ability to deliver new products, services and customer experiences
and a portfolio of in-demand and available vehicles
-- Risks associated with our indebtedness, including available borrowing
capacity, interest rates, compliance with financial covenants and
ability to refinance or repay indebtedness on favorable terms
-- The adequacy of our cash flows and other conditions which may affect our
ability to fund capital expenditures, obtain favorable financing and pay
our quarterly dividend at planned levels
-- Disruptions to our technology network including computer systems, as
well as natural events such as severe weather or man-made or other
disruptions of our operating systems, facilities or equipment
-- Government regulations and legislation
-- The 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, which may include adjusted net income and adjusted 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.
LAD
Consolidated Statements of Operations (Unaudited)
(In millions except per share data)
Three months ended % Nine months ended %
September 30, September 30,
Increase Increase
2024 2023 (Decrease) 2024 2023 (Decrease)
Revenues:
New vehicle retail $4,430.0 $3,885.8 14.0 % $12,847.9 $11,179.5 14.9 %
Used vehicle retail 2,843.3 2,620.2 8.5 8,630.1 7,302.8 18.2
Used vehicle wholesale 390.9 316.1 23.7 1,018.1 1,082.4 (5.9)
Finance and insurance 360.4 349.4 3.1 1,061.9 1,005.6 5.6
Aftersales 1,012.8 838.0 20.9 2,876.3 2,378.8 20.9
Fleet and other 183.6 267.5 (31.4) 580.4 418.9 38.6
Total revenues 9,221.0 8,277.0 11.4 % 27,014.7 23,368.0 15.6 %
Cost of sales:
New vehicle retail 4,123.6 3,526.9 16.9 11,925.4 10,099.6 18.1
Used vehicle retail 2,654.4 2,431.2 9.2 8,062.9 6,735.4 19.7
Used vehicle wholesale 393.0 322.1 22.0 1,020.7 1,091.9 (6.5)
Aftersales 453.0 375.2 20.7 1,285.1 1,077.7 19.2
Fleet and other 166.6 250.3 (33.4) 531.1 395.2 34.4
Total cost of sales 7,790.6 6,905.7 12.8 22,825.2 19,399.8 17.7
Gross profit 1,430.4 1,371.3 4.3 % 4,189.5 3,968.2 5.6 %
Finance operations income (loss) 0.9 (4.4) NM 6.4 (43.8) NM
SG&A expense 943.6 850.8 10.9 2,853.0 2,458.1 16.1
Depreciation and amortization 63.5 50.8 25.0 183.6 146.4 25.4
Income from operations 424.2 465.3 (8.8) % 1,159.3 1,319.9 (12.2) %
Floor plan interest expense (76.6) (40.2) 90.5 (214.0) (102.6) 108.6
Other interest expense (64.5) (58.5) 10.3 (189.3) (141.5) 33.8
Other income (expense) 5.1 (5.3) 196.2 35.4 6.8 420.6
Income before income taxes 288.2 361.3 (20.2) % 791.4 1,082.6 (26.9) %
Income tax expense (65.3) (96.4) (32.3) (187.0) (287.0) (34.8)
Income tax rate 22.7 % 26.7 % 23.6 % 26.5 %
Net income $222.9 $264.9 (15.9) % $604.4 $795.6 (24.0) %
Net income attributable to non-controlling (1.2) (2.1) (42.9) % (3.8) (4.7) (19.1) %
interests
Net income attributable to redeemable non- (12.6) (1.3) 869.2 % (14.8) (3.6) 311.1 %
controlling interest
Net income attributable to LAD $209.1 $261.5 (20.0) % $585.8 $787.3 (25.6) %
Diluted earnings per share attributable
to LAD:
Net income per share $7.80 $9.46 (17.5) % $21.54 $28.54 (24.5) %
Diluted shares outstanding 26.8 27.6 (2.9) % 27.2 27.6 (1.4) %
NM - not meaningful
LAD
Key Performance Metrics (Unaudited)
Three months ended % Nine months ended %
September 30, September 30,
Increase Increase
2024 2023 (Decrease) 2024 2023 (Decrease)
Gross margin
---
New vehicle retail 6.9 % 9.2 % (230) bps 7.2 % 9.7 % (250) bps
Used vehicle retail 6.6 7.2 (60) 6.6 7.8 (120)
Finance and insurance 100.0 100.0 100.0 100.0
Aftersales 55.3 55.2 10 55.3 54.7 60
Gross profit margin 15.5 16.6 (110) 15.5 17.0 (150)
Unit sales
---
New vehicle retail 94,964 82,188 15.5 % 273,154 233,521 17.0 %
Used vehicle retail 104,898 88,625 18.4 316,583 247,340 28.0
Average selling price
---
New vehicle retail $46,649 $47,279 (1.3) % $47,035 $47,874 (1.8) %
Used vehicle retail 27,105 29,565 (8.3) 27,260 29,525 (7.7)
Average gross profit per unit
---
New vehicle retail $3,226 $4,367 (26.1) % $3,377 $4,624 (27.0) %
Used vehicle retail 1,801 2,132 (15.5) 1,792 2,294 (21.9)
Finance and insurance 1,803 2,045 (11.8) 1,801 2,091 (13.9)
Total vehicle(1) 4,271 5,218 (18.1) 4,322 5,497 (21.4)
Revenue mix
---
New vehicle retail 48.0 % 46.9 % 47.6 % 47.8 %
Used vehicle retail 30.8 31.7 31.9 31.3
Used vehicle wholesale 4.2 3.8 3.8 4.6
Finance and insurance, net 3.9 4.2 3.9 4.3
Aftersales 11.0 10.1 10.6 10.2
Fleet and other 2.1 3.3 2.2 1.8
Gross Profit Mix
---
New vehicle retail 21.4 % 26.2 % 22.0 % 27.2 %
Used vehicle retail 13.2 13.8 13.5 14.3
Used vehicle wholesale (0.1) (0.4) (0.1) (0.2)
Finance and insurance, net 25.2 25.5 25.3 25.3
Aftersales 39.1 33.6 38.1 32.8
Fleet and other 1.2 1.3 1.2 0.6
Adjusted As reported Adjusted As reported
Three months Three months Nine months Nine months
ended September ended September ended September ended September
30, 30, 30, 30,
Other metrics 2024 2023 2024 2023 2024 2023 2024 2023
---
SG&A as a % of revenue 10.2 % 10.4 % 10.2 % 10.3 % 10.5 % 10.5 % 10.6 % 10.5 %
SG&A as a % of gross profit 66.0 62.7 66.0 62.0 67.7 61.9 68.1 61.9
Operating profit as a % of revenue 4.6 5.5 4.6 5.6 4.3 5.7 4.3 5.6
Operating profit as a % of gross profit 29.6 33.2 29.7 33.9 28.0 33.3 27.7 33.3
Pretax margin 3.1 4.3 3.1 4.4 3.0 4.6 2.9 4.6
Net profit margin 2.4 3.1 2.4 3.2 2.3 3.4 2.2 3.4
(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
LAD
Same Store Operating Highlights (Unaudited)
Three months ended % Nine months ended %
September 30, September 30,
Increase Increase
2024 2023 (Decrease) 2024 2023 (Decrease)
Revenues
---
New vehicle retail $3,900.9 $3,851.6 1.3 % $10,946.7 $10,959.3 (0.1) %
Used vehicle retail 2,213.1 2,592.5 (14.6) 6,488.8 7,135.6 (9.1)
Finance and insurance 322.0 345.1 (6.7) 931.6 986.6 (5.6)
Aftersales 871.6 829.3 5.1 2,382.0 2,327.2 2.4
Total revenues 7,690.6 8,199.1 (6.2) 21,754.2 22,881.9 (4.9)
Gross profit
---
New vehicle retail $265.2 $356.9 (25.7) % $764.5 $1,058.7 (27.8) %
Used vehicle retail 169.4 187.2 (9.5) 491.4 554.9 (11.4)
Finance and insurance 322.0 345.1 (6.7) 931.6 986.6 (5.6)
Aftersales 487.8 458.9 6.3 1,332.5 1,276.6 4.4
Total gross profit 1,250.3 1,359.4 (8.0) 3,532.3 3,891.1 (9.2)
Gross margin
---
New vehicle retail 6.8 % 9.3 % (250) bps 7.0 % 9.7 % (270) bps
Used vehicle retail 7.7 7.2 50 7.6 7.8 (20)
Finance and insurance 100.0 100.0 100.0 100.0
Aftersales 56.0 55.3 70 55.9 54.9 100
Gross profit margin 16.3 16.6 (30) 16.2 17.0 (80)
Unit sales
---
New vehicle retail 83,177 81,520 2.0 % 229,520 229,145 0.2 %
Used vehicle retail 79,297 87,672 (9.6) 231,665 242,017 (4.3)
Average selling price
---
New vehicle retail $46,898 $47,248 (0.7) % $47,694 $47,827 (0.3) %
Used vehicle retail 27,909 29,571 (5.6) 28,009 29,484 (5.0)
Average gross profit per unit
---
New vehicle retail $3,188 $4,377 (27.2) % $3,331 $4,620 (27.9) %
Used vehicle retail 2,136 2,135 2,121 2,293 (7.5)
Finance and insurance 1,982 2,040 (2.8) 2,020 2,094 (3.5)
Total vehicle(1) 4,631 5,221 (11.3) 4,719 5,499 (14.2)
(1) Includes the sales and gross profit related to new, used retail, used wholesale and finance and insurance and unit sales for new and used retail
LAD
Other Highlights (Unaudited)
Three months ended September 30, Nine months ended September 30,
2024 2024
Key Performance by Country Total Revenue Total Gross Total Revenue Total Gross
Profit Profit
---
United States 76.6 % 83.1 % 77.5 % 83.4 %
United Kingdom 20.2 % 14.3 % 19.3 % 13.9 %
Canada 3.2 % 2.6 % 3.2 % 2.7 %
As of
September 30, December 31, September 30,
Days Supply
(1) 2024 2023 2023
---
New vehicle inventory 68 65 55
Used vehicle inventory 68 64 58
(1) Days supply calculated based on current inventory levels, including in-transit vehicles, and a 30-day historical cost of sales level.
Selected Financing Operations Financial Information
---
Three months ended September 30, Nine months ended September 30,
($ in millions) 2024 % (1) 2023 % (1) 2024 % (1) 2023 % (1)
Interest margin:
Interest and fee income $91.1 9.5 $67.5 8.7 $252.2 9.3 $176.2 8.6
Interest expense (51.2) (5.3) (42.5) (5.4) (146.0) (5.4) (125.5) (6.1)
Total interest margin $39.9 4.1 $25.0 3.2 $106.2 3.9 $50.7 2.5
Lease income 25.6 4.9 61.2 14.1
Lease costs (21.6) (2.0) (51.0) (6.3)
Lease income, net 4.0 2.9 10.2 7.8
Selling, general and administrative (11.2) (9.2) (33.0) (27.3)
Provision expense (31.8) (3.3) (23.1) (3.0) (77.0) (2.8) (75.0) (3.7)
Finance operations income (loss) $0.9 $(4.4) $6.4 $(43.8)
Total average managed finance receivables $3,812.8 $3,092.4 $3,617.4 $2,731.0
(1) Annualized percentage of total average managed finance receivables
LAD
Condensed Consolidated Balance Sheets (Unaudited)
(In millions)
September 30, 2024 December 31, 2023
Cash, restricted cash, and cash equivalents $359.5 $941.4
Trade receivables, net 1,209.4 1,123.1
Inventories, net 6,100.2 4,753.9
Other current assets 224.0 136.8
Total current assets $7,893.1 $6,955.2
Property and equipment, net 4,664.0 3,981.4
Finance receivables, net 3,765.5 3,242.3
Intangibles 4,701.5 4,332.8
Other non-current assets 2,237.4 1,120.8
Total assets $23,261.5 $19,632.5
Floor plan notes payable 5,119.6 3,635.5
Other current liabilities 1,544.5 1,296.7
Total current liabilities $6,664.1 $4,932.2
Long-term debt, less current maturities 6,399.8 5,483.7
Non-recourse notes payable, less current maturities 1,772.7 1,671.7
Other long-term liabilities and deferred revenue 1,796.7 1,262.0
Total liabilities $16,633.3 $13,349.6
Equity and redeemable non-controlling interest 6,628.2 6,282.9
Total liabilities, equity, and redeemable non-controlling interest $23,261.5 $19,632.5
LAD
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In millions)
Nine months ended September 30,
Cash flows from operating activities: 2024 2023
Net income $604.4 $795.6
Adjustments to reconcile net income to net cash used in operating activities 397.2 250.2
Changes in:
Inventories (324.3) (498.2)
Finance receivables (526.5) (907.0)
Floor plan notes payable 325.0 292.0
Other operating activities (112.5) (109.8)
Net cash provided by (used in) operating activities 363.3 (177.2)
Cash flows from investing activities:
Capital expenditures (271.9) (163.7)
Cash paid for acquisitions, net of cash acquired (1,247.0) (1,204.7)
Proceeds from sales of stores 21.9 136.1
Other investing activities (323.8) (8.0)
Net cash used in investing activities (1,820.8) (1,240.3)
Cash flows from financing activities:
Net borrowings on floor plan notes payable, non-trade 280.1 426.7
Net borrowings non-recourse notes payable 77.4 1,047.7
Net borrowings of other debt and finance lease liabilities 900.7 (5.7)
Proceeds from issuance of common stock 21.3 23.0
Repurchase of common stock (273.2) (14.5)
Dividends paid (42.4) (39.1)
Other financing activity (83.7) (11.1)
Net cash provided by financing activities 880.2 1,427.0
Effect of exchange rate changes on cash and restricted cash 3.9 5.7
Change in cash, restricted cash, and cash equivalents (573.4) 15.2
Cash, restricted cash, and cash equivalents at beginning of period 972.0 271.5
Cash, restricted cash, and cash equivalents at end of period 398.6 286.7
LAD
Reconciliation of Non-GAAP Cash Flow from Operations (Unaudited)
(In millions)
Nine months ended September 30,
Net cash provided by operating activities 2024 2023
---
As reported $363.3 $(177.2)
Floor plan notes payable, non-trade, net 280.1 426.7
Adjust: finance receivables activity 526.5 907.0
Less: Borrowings on floor plan notes payable, non-trade associated with (105.5) (110.6)
acquired new vehicle inventory
Adjusted $1,064.4 $1,045.9
LAD
Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)
(In millions, except for per share data)
Three Months Ended September 30, 2024
As reported Net gain Acquisition Premium on Tax
attribute Adjusted
on disposal expenses redeemable
of stores NCI buyout
Selling, general and administrative $943.6 $0.3 $(0.2)
$ -
$ - $943.7
Operating income 424.2 (0.3) 0.2 424.1
Income before income taxes 288.2 (0.3) 0.2 288.1
Income tax (provision) benefit (65.3) 0.1 (0.1) (0.5) (65.8)
Net income $222.9 $(0.2) $0.1
$ - $(0.5) $222.3
Net income attributable to non-controlling (1.2) (1.2)
interests
Net income attributable to redeemable non- (12.6) 11.6 (1.0)
controlling interest
Net income attributable to LAD $209.1 $(0.2) $0.1 $11.6 $(0.5) $220.1
Diluted earnings per share attributable to LAD $7.80 $(0.01)
$ - $0.43 $(0.01) $8.21
Diluted share count 26.8
Three Months Ended September 30, 2023
As reported Net gain Insurance Acquisition Contract Adjusted
on disposal reserves expenses buyouts
of stores
Selling, general and administrative $850.8 $23.1 $(4.6) $(4.8) $(4.2) $860.3
Operating income 465.3 (23.1) 4.6 4.8 4.2 455.8
Income before income taxes 361.3 (23.1) 4.6 4.8 4.2 351.8
Income tax (provision) benefit (96.4) 6.1 (1.2) (0.8) (1.1) (93.4)
Net income $264.9 $(17.0) $3.4 $4.0 $3.1 $258.4
Net income attributable to non-controlling $(2.1)
$ -
$ -
$ -
$ - $(2.1)
interests
Net income attributable to redeemable non- $(1.3)
$ -
$ -
$ -
$ - $(1.3)
controlling interest
Net income attributable to LAD $261.5 $(17.0) $3.4 $4.0 $3.1 $255.0
Diluted earnings per share attributable to LAD $9.46 $(0.62) $0.12 $0.15 $0.11 $9.22
Diluted share count 27.6
LAD
Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)
(In millions, except for per share data)
Nine Months Ended September 30, 2024
As reported Net gain Insurance Acquisition Premium on Tax
on attribute Adjusted
disposal
of reserves expenses redeemable
stores NCI buyout
Selling, general and administrative $2,853.0 $0.3 $(6.0) $(9.7)
$ -
$ - $2,837.6
Operating income 1,159.3 (0.3) 6.0 9.7 1,174.7
Income before income taxes 791.4 (0.3) 6.0 9.7 806.8
Income tax (provision) benefit (187.0) 0.1 (1.5) (0.5) (8.0) (196.9)
Net income $604.4 $(0.2) $4.5 $9.2
$ - $(8.0) $609.9
Net income attributable to non-controlling (3.8) (3.8)
interests
Net income attributable to redeemable non- (14.8) 11.6 (3.2)
controlling interest
Net income attributable to LAD $585.8 $(0.2) $4.5 $9.2 $11.6 $(8.0) $602.9
Diluted earnings per share attributable to LAD $21.54 $(0.01) $0.17 $0.34 $0.43 $(0.30) $22.17
Diluted share count 27.2
Nine Months Ended September 30, 2023
As reported Net gain
on Insurance Acquisition Contract Adjusted
disposal
of reserves expenses buyouts
stores
Selling, general and administrative $2,458.1 $31.4 $(7.1) $(10.5) $(14.4) $2,457.5
Operating income 1,319.9 (31.4) 7.1 10.5 14.4 1,320.5
Income before income taxes 1,082.6 (31.4) 7.1 10.5 14.4 1,083.2
Income tax (provision) benefit (287.0) 8.5 (1.9) (1.5) (3.9) (285.8)
Net income $795.6 $(22.9) $5.2 $9.0 $10.5 $797.4
Net income attributable to non-controlling (4.7) (4.7)
interests
Net income attributable to redeemable non- (3.6) (3.6)
controlling interest
Net income attributable to LAD $787.3 $(22.9) $5.2 $9.0 $10.5 $789.1
Diluted earnings per share attributable to LAD $28.54 $(0.83) $0.19 $0.33 $0.38 $28.61
Diluted share count 27.6
LAD
Adjusted EBITDA and Net Debt to Adjusted EBITDA (Unaudited)
(In millions)
Three months ended % Nine months ended %
September 30, September 30,
Increase Increase
2024 2023 (Decrease) 2024 2023 (Decrease)
EBITDA and Adjusted EBITDA
---
Net income $222.9 $264.9 (15.9) % $604.4 $795.6 (24.0) %
Flooring interest expense 76.6 40.2 90.5 214.0 102.6 108.6
Other interest expense 64.5 58.5 10.3 189.3 141.5 33.8
Financing operations interest expense 51.2 42.5 20.5 146.0 125.5 16.3
Income tax expense 65.3 96.4 (32.3) 187.0 287.0 (34.8)
Depreciation and amortization 63.5 50.8 25.0 183.6 146.4 25.4
Financing operations depreciation expense 12.7 2.0 535.0 37.3 6.3 492.1
EBITDA $556.7 $555.3 0.3 % $1,561.6 $1,604.9 (2.7) %
Other adjustments:
Less: flooring interest expense $(76.6) $(40.2) 90.5 $(214.0) $(102.6) 108.6
Less: financing operations interest expense (51.2) (42.5) 20.5 (146.0) (125.5) 16.3
Less: used vehicle line of credit interest (7.4) (6.4) 15.6 (19.5) (11.2) 74.1
Add: acquisition expenses 0.2 4.8 (95.8) 9.7 10.5 (7.6)
Less: loss (gain) on disposal of stores (0.3) (23.1) NM (0.3) (31.4) NM
Add: insurance reserves - 4.6 NM 6.0 7.1 NM
Add: contract buyouts - 4.2 NM 14.4 NM
Adjusted EBITDA $421.4 $456.7 (7.7) % $1,197.5 $1,366.2 (12.3) %
NM - not meaningful
As of %
September 30, Increase
Net Debt to Adjusted EBITDA 2024 2023 (Decrease)
---
Floor plan notes payable: non-trade $2,516.7 $1,863.4 35.1 %
Floor plan notes payable 2,602.9 1,261.2 106.4
Used and service loaner vehicle inventory financing facility 925.7 860.2 7.6
Revolving lines of credit 1,848.2 1,281.4 44.2
Warehouse facilities 1,035.0 585.0 76.9
Non-recourse notes payable 1,783.0 1,469.9 21.3
4.625% Senior notes due 2027 400.0 400.0
4.375% Senior notes due 2031 550.0 550.0
3.875% Senior notes due 2029 800.0 800.0
Finance leases and other debt 980.5 746.8 31.3
Unamortized debt issuance costs (26.4) (33.4) (21.0)
Total debt $13,415.6 $9,784.5 37.1 %
Less: Floor plan related debt $(6,045.3) $(3,984.8) 51.7 %
Less: Financing operations related debt (2,818.0) (2,054.9) 37.1
Less: Unrestricted cash and cash equivalents (209.8) (146.9) 42.8
Less: Marketable securities (53.9)
Less: Availability on used vehicle and service loaner financing facilities (9.8) (66.8) (85.3)
Net Debt $4,278.8 $3,531.1 21.2 %
TTM Adjusted EBITDA $1,594.2 $1,780.1 (10.4) %
Net debt to Adjusted EBITDA 2.68 x 1.98 x
NM - not meaningful
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SOURCE Lithia Motors, Inc.
