Avis Budget Group, Inc. (
NASDAQ: CAR) today
reported results for its first quarter ended March 31, 2020.
First Quarter 2020 over First Quarter 2019:
- Revenues of $1.8 billion, a decrease of
9%, however, Year to Date February Revenues were up
9%
- Net loss of $158 million, or $2.16 per diluted share
and Adjusted net loss of $103 million, or $1.40 per Adjusted
diluted share
- Adjusted EBITDA loss of $87
million, however, Year to Date February Adjusted
EBITDA was up ~$60 million
- Per-Unit Fleet Costs improved 7% excluding exchange
rate effects
- Available liquidity of $1.6 billion at March 31,
2020
Company Results
The momentum from the fourth quarter continued into the first
quarter and we were off to a record start, with revenues up 9%,
driven by a 15% improvement in the Americas and Adjusted EBITDA
approximately $60 million better than the prior year through
February. However, the pandemic impacted travel activity and
shelter in place requirements caused significant deterioration in
revenue through March. We took dramatic action to respond to the
crisis, including significant reductions in personnel, shrinking
the size of the fleet, and halting all non-essential spending,
initially targeting $400 million in annualized cost savings, which
we materially increased.
“I am incredibly proud of our team,” said Joe Ferraro, Avis
Budget Group Interim Chief Executive Officer. “We ended February
off to a record start to the year, and in less than a week, we
pivoted the entire organization to respond to the unprecedented
effects of the pandemic on our business and the economy. Our top
priority continues to be the safety of both our employees and our
customers. Our front line employees went above and beyond to assist
people in getting home, traveling to care for loved ones or to
provide essential services, including first responders and delivery
services. At the same time, we took early and decisive actions with
our fleet, disposing of 35,000 cars in the month of March and
cancelling 80% of our incoming rental vehicle orders in the
United States for the remainder of the year.”
First quarter revenues decreased 8% compared to prior year
excluding a $20 million negative impact from currency exchange rate
movements, comprised of a 7% decrease in Rental Days and a 1%
decrease in Revenue per Day, excluding exchange rate effects. For
the quarter, net loss was $158 million, or $2.16 per diluted share,
Adjusted EBITDA loss was $87 million and Adjusted net loss was $103
million, or $1.40 per Adjusted diluted share.
“We quickly responded to remove costs and preserve liquidity,”
said Ferraro. “As of the end of April, we achieved over $2.0
billion of annualized cost removal actions, including reductions in
headcount, a significantly smaller vehicle fleet, and the
elimination of all non-essential capital and operating expenses.
However, we will remain vigilant and will identify additional cost
removal actions if we experience a slower recovery or in the event
of further disruption later in the year.”
Current Liquidity and Credit Amendment
As of March 31, 2020, we had available liquidity of $1.6
billion, comprised of $0.7 billion in cash and cash equivalents,
approximately $0.7 billion of accessible cash from our vehicle
programs, which is not consolidated on our balance sheet, and $0.2
billion in availability under our revolving credit facility after
taking into account estimated needs for letters of credit. We
estimate our cash burn for the second quarter 2020 will be
approximately $800 million, excluding $100 million of debt
retirements associated with our senior notes due 2023 which were
redeemed in February.
We have no meaningful corporate debt maturities until 2023 and
have no material fleet financing maturities in 2020. Based on
current operational assumptions, we believe we have adequate
liquidity for the balance of 2020 and into 2021.
On April 27, 2020, we amended our existing senior credit
facilities, comprised of a term loan and revolving credit facility,
obtaining approval from 97% of our creditors. The amendment granted
a waiver of the leverage covenant until June 30, 2021, and provides
for a relaxed covenant until June 30, 2022. Additionally, the
amendment allows us to incur up to $750 million of additional first
lien debt.
Outlook
We anticipate revenues being approximately 80% lower in April
and May compared to the prior year, with a gradual recovery in June
and improving thereafter, as shelter in place restrictions are
lifted and leisure travel begins to resume. Our current
reservations show improvement in June and sequentially increase
over the balance of the summer.
In markets where shelter in place restrictions are being lifted,
we are seeing early indications of improving demand, leaving us
optimistic for the third quarter. Given the significant
cancellations of vehicle orders, which reduce the number of units
being added to our fleet, we anticipate needing to dispose of fewer
vehicles over the next three months.
As the economy begins to reopen, we are emphasizing safety,
trust and empathy in all of our actions. We believe renting a
vehicle will be an attractive alternative to other forms of
transportation as travel activities resume. We have enhanced our
cleaning protocols, including utilizing disinfectant that is
CDC-recommended and EPA certified to be effective against human
coronavirus, including novel pathogens such as the one responsible
for COVID-19.
“Car rental is a clean and safe form of transportation,” said
Ferraro. “Empowering our customers to control their own environment
as they travel is a key differentiator. We have a strong legacy of
providing clean vehicles and improving the customer experience. In
times of uncertainty, our customers can count on us to get them
wherever they need to go both safely and conveniently.”
Investor Conference Call
We will host a conference call to discuss first quarter results
and our outlook on May 5, 2020, at 7:00 a.m. (ET). Investors may
access the call at ir.avisbudgetgroup.com or by dialing (877)
407-2991 and a replay will available on our website and at (877)
660-6853 using conference code 13702810.
About Avis Budget Group
Avis Budget Group, Inc. is a leading global provider of mobility
solutions, both through its Avis and Budget brands, which have more
than 11,000 rental locations in approximately 180 countries around
the world, and through its Zipcar brand, which is the world's
leading car sharing network with more than one million members.
Avis Budget Group operates most of its car rental offices in North
America, Europe and Australasia directly, and operates primarily
through licensees in other parts of the world. Avis Budget Group is
headquartered in Parsippany, N.J. More information is available at
avisbudgetgroup.com.
Forward-Looking Statements
Certain statements in this press release constitute
“forward-looking statements.” Any statements that refer to outlook,
expectations or other characterizations of future events,
circumstances or results, including all statements related to our
future results, impact from the coronavirus, cost-saving actions,
and cash flows are forward-looking statements. Various risks that
could cause future results to differ from those expressed by the
forward-looking statements included in this press release include,
but are not limited to, the severity and duration of the COVID-19
outbreak and related travel restrictions, the high level of
competition in the mobility industry, changes in our fleet costs as
a result of a change in the cost of new vehicles, manufacturer
recalls and/or the value of used vehicles, disruption in the supply
of new vehicles, disposition of vehicles not covered by
manufacturer repurchase programs, the financial condition of the
manufacturers that supply our rental vehicles which could affect
their ability to perform their obligations under our repurchase
and/or guaranteed depreciation arrangements, any further
deterioration in economic conditions generally, particularly during
our peak season and/or in key market segments, any further
deterioration in travel demand, including airline passenger
traffic, any occurrence or threat of terrorism, any changes to the
cost or supply of fuel, risks related to acquisitions or
integration of acquired businesses, risks associated with
litigation, governmental or regulatory inquiries or investigations,
risks related to the security of our information technology
systems, disruptions in our communication networks, changes in tax
or other regulations, a significant increase in interest rates or
borrowing costs, our ability to obtain financing for our global
operations, including the funding of our vehicle fleet via
asset-backed securities markets, any fluctuations related to the
mark-to-market of derivatives which hedge our exposure to exchange
rates, interest rates and fuel costs, our ability to meet the
covenants contained in the agreements governing our indebtedness,
and our ability to accurately estimate our future results and
implement our cost savings actions. Other unknown or unpredictable
factors could also have material adverse effects on the Company’s
performance or achievements. Important assumptions and other
important factors that could cause actual results to differ
materially from those in the forward-looking statements are
specified in Avis Budget Group’s Annual Report on Form 10-K for the
year ended December 31, 2019 and Quarterly Report on Form 10-Q for
the three months ended March 31, 2020 and in other filings and
furnishings made by the Company with the Securities and Exchange
Commission (the "SEC") from time to time. The Company undertakes no
obligation to publicly update any forward-looking statements to
reflect subsequent events or circumstances.
Non-GAAP Financial Measures and Key Metrics
This release includes financial measures such as Adjusted EBITDA
and Adjusted free cash flow, as well as other financial measures
that exclude certain items that are not considered generally
accepted accounting principles (“GAAP”) measures as defined under
SEC rules. Important information regarding such measures is
contained on Table 1, Table 4, Table 5 and Appendix I of this
release. The Company and its management believe that these non-GAAP
measures are useful to investors in measuring the comparable
results of the Company period-over-period. The GAAP measures most
directly comparable to Adjusted EBITDA, Adjusted free cash flow,
Adjusted pretax income (loss), Adjusted net income (loss) and
Adjusted diluted earnings (loss) per share are net income (loss),
net cash provided by operating activities, income (loss) before
income taxes, net income (loss) and diluted earnings (loss) per
share, respectively. Foreign currency translation effects on the
Company’s results are quantified by translating the current
period’s non-U.S. dollar-denominated results using the currency
exchange rates of the prior period of comparison including any
related gains and losses on currency hedges. Per-unit fleet costs,
which represent vehicle depreciation, lease charges and gain or
loss on vehicle sales, divided by average rental fleet, are
calculated on a per-month basis.
Contact |
David Calabria |
IR@avisbudget.com |
PR@avisbudget.com |
###Tables Follow
Table 1 |
Avis Budget Group, Inc. |
SUMMARY DATA SHEET |
(In millions, except per share data) |
|
|
Three Months
Ended March 31, |
|
2020 |
|
2019 |
|
% Change |
Income Statement and Other Items |
|
|
|
|
|
Revenues |
$ |
1,753 |
|
|
$ |
1,920 |
|
|
(9 |
) |
% |
Loss before income taxes |
(265 |
) |
|
(136 |
) |
|
(95 |
) |
% |
Net loss |
(158 |
) |
|
(91 |
) |
|
(74 |
) |
% |
Loss per share - diluted |
(2.16 |
) |
|
(1.20 |
) |
|
(80 |
) |
% |
|
|
|
|
|
|
Adjusted Earnings Measures (non-GAAP) (A) |
|
|
|
|
|
Adjusted EBITDA |
(87 |
) |
|
(1 |
) |
|
n/m |
Adjusted pretax loss |
(191 |
) |
|
(93 |
) |
|
n/m |
Adjusted net loss |
(103 |
) |
|
(59 |
) |
|
(75 |
) |
% |
Adjusted loss per share - diluted |
(1.40 |
) |
|
(0.78 |
) |
|
(79 |
) |
% |
|
|
|
|
|
|
|
As
of |
|
|
|
March 31, 2020 |
|
December 31, 2019 |
|
|
Balance Sheet Items |
|
|
|
|
|
Cash and cash equivalents |
$ |
679 |
|
|
$ |
686 |
|
|
|
Vehicles, net |
12,815 |
|
|
12,177 |
|
|
|
Debt under vehicle programs |
11,998 |
|
|
11,068 |
|
|
|
Corporate debt |
3,514 |
|
|
3,435 |
|
|
|
Stockholders' equity |
292 |
|
|
656 |
|
|
|
Segment Results |
|
Three Months
Ended March 31, |
|
2020 |
|
2019 |
|
% Change |
Revenues |
|
|
|
|
|
Americas |
$ |
1,257 |
|
|
$ |
1,327 |
|
|
(5 |
) |
% |
International |
496 |
|
|
593 |
|
|
(16 |
) |
% |
Corporate and Other |
- |
|
|
- |
|
|
n/m |
Total Company |
$ |
1,753 |
|
|
$ |
1,920 |
|
|
(9 |
) |
% |
|
Adjusted EBITDA |
|
|
|
|
|
Americas |
$ |
(30 |
) |
|
$ |
35 |
|
|
n/m |
International |
(40 |
) |
|
(21 |
) |
|
(90 |
) |
% |
Corporate and Other |
(17 |
) |
|
(15 |
) |
|
n/m |
Total Company |
$ |
(87 |
) |
|
$ |
(1 |
) |
|
n/m |
n/m |
Not meaningful. |
(A) |
See Table 5 for reconciliations
of non-GAAP measures and Appendix I for definitions. |
Table 2 |
Avis Budget Group, Inc. |
CONSOLIDATED STATEMENTS OF OPERATIONS |
(In millions, except per share data) |
|
|
Three Months Ended March 31, |
|
2020 |
|
2019 |
Revenues |
$ |
1,753 |
|
|
$ |
1,920 |
|
|
|
|
|
Expenses |
|
|
|
Operating |
1,058 |
|
|
1,071 |
|
Vehicle depreciation and lease charges, net |
459 |
|
|
485 |
|
Selling, general and administrative |
251 |
|
|
284 |
|
Vehicle interest, net |
83 |
|
|
81 |
|
Non-vehicle related depreciation and amortization |
69 |
|
|
67 |
|
Interest expense related to corporate debt, net: |
|
|
|
Interest expense |
48 |
|
|
42 |
|
Early extinguishment of debt |
4 |
|
|
- |
|
Restructuring and other related charges |
44 |
|
|
21 |
|
Transaction-related costs, net |
2 |
|
|
5 |
|
Total expenses |
2,018 |
|
|
2,056 |
|
|
|
|
|
Loss before income
taxes |
(265 |
) |
|
(136 |
) |
Benefit from income taxes |
(107 |
) |
|
(45 |
) |
Net loss |
$ |
(158 |
) |
|
$ |
(91 |
) |
|
|
|
|
Loss per share -
diluted |
|
|
|
Basic |
$ |
(2.16 |
) |
|
$ |
(1.20 |
) |
Diluted |
$ |
(2.16 |
) |
|
$ |
(1.20 |
) |
|
|
|
|
Weighted average
shares outstanding |
|
|
|
Basic |
72.9 |
|
|
75.8 |
|
Diluted |
72.9 |
|
|
75.8 |
|
Table 3 |
Avis Budget Group, Inc. |
KEY METRICS SUMMARY |
|
|
Three Months Ended March 31, |
|
2020 |
|
2019 |
|
% Change |
|
|
|
|
|
|
Americas |
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
23,458 |
|
|
24,709 |
|
|
(5 |
) |
% |
Revenue per Day, excluding exchange rate effects
(A) |
$ |
53.61 |
|
|
$ |
53.74 |
|
|
0 |
|
% |
Average Rental Fleet |
416,937 |
|
|
397,008 |
|
|
5 |
|
% |
Vehicle Utilization |
61.8 |
% |
|
69.2 |
% |
|
(740) bps |
Per-Unit Fleet Costs per Month, excluding exchange rate effects
(A) |
$ |
266 |
|
|
$ |
297 |
|
|
(10 |
) |
% |
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
11,067 |
|
|
12,456 |
|
|
(11 |
) |
% |
Revenue per Day, excluding exchange rate effects
(A) |
$ |
46.61 |
|
|
$ |
47.59 |
|
|
(2 |
) |
% |
Average Rental Fleet |
192,755 |
|
|
197,693 |
|
|
(2 |
) |
% |
Vehicle Utilization |
63.1 |
% |
|
70.0 |
% |
|
(690) bps |
Per-Unit Fleet Costs per Month, excluding exchange rate effects
(A) |
$ |
227 |
|
|
$ |
223 |
|
|
2 |
|
% |
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
34,525 |
|
|
37,165 |
|
|
(7 |
) |
% |
Revenue per Day, excluding exchange rate effects
(A) |
$ |
51.36 |
|
|
$ |
51.67 |
|
|
(1 |
) |
% |
Average Rental Fleet |
609,692 |
|
|
594,701 |
|
|
3 |
|
% |
Vehicle Utilization |
62.2 |
% |
|
69.4 |
% |
|
(720) bps |
Per-Unit Fleet Costs per Month, excluding exchange rate effects
(A) |
$ |
253 |
|
|
$ |
272 |
|
|
(7 |
) |
% |
_______ |
Refer to Table 6
for key metrics calculations and Appendix I for key metrics
definitions. |
(A) The following metrics include changes in
currency exchange rates: |
|
Three Months Ended March 31, |
|
2020 |
|
2019 |
|
% Change |
|
|
|
|
|
|
Americas |
|
|
|
|
|
|
|
|
|
|
|
Revenue per Day |
$ |
53.59 |
|
|
$ |
53.74 |
|
|
0 |
|
% |
Per-Unit Fleet Costs per Month |
$ |
265 |
|
|
$ |
297 |
|
|
(11 |
) |
% |
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
Revenue per Day |
$ |
44.77 |
|
|
$ |
47.59 |
|
|
(6 |
) |
% |
Per-Unit Fleet Costs per Month |
$ |
219 |
|
|
$ |
223 |
|
|
(2 |
) |
% |
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Revenue per Day |
$ |
50.76 |
|
|
$ |
51.67 |
|
|
(2 |
) |
% |
Per-Unit Fleet Costs per Month |
$ |
251 |
|
|
$ |
272 |
|
|
(8 |
) |
% |
Table 4 (page 1 of 2) |
Avis Budget Group, Inc. |
CONSOLIDATED CONDENSED SCHEDULES OF CASH FLOWS AND ADJUSTED
FREE CASH FLOWS |
(In millions) |
|
CONSOLIDATED CONDENSED SCHEDULE OF CASH FLOWS |
|
|
Three Months Ended March 31, 2020 |
Operating
Activities |
|
Net cash provided by operating activities |
$ |
370 |
|
|
|
Investing
Activities |
|
Net cash used in investing activities exclusive of vehicle
programs |
$ |
(92 |
) |
Net cash used in investing activities of vehicle programs |
(1,390 |
) |
Net cash used in investing activities |
$ |
(1,482 |
) |
|
|
Financing
Activities |
|
Net cash provided by (used in) financing activities exclusive of
vehicle programs |
$ |
(14 |
) |
Net cash provided by (used in) financing activities of vehicle
programs |
976 |
|
Net cash provided by (used in) financing activities |
$ |
962 |
|
|
|
Effect of changes in exchange
rates on cash and cash equivalents, program and restricted
cash |
(29 |
) |
Net change in cash and cash
equivalents, program and restricted cash |
(179 |
) |
Cash and cash
equivalents, program and restricted cash, beginning of period
(A) |
900 |
|
Cash and cash
equivalents, program and restricted cash, end of period
(B) |
$ |
721 |
|
|
_______ |
(A) |
Consists of cash and cash
equivalents of $686 million, program cash of $211 million and
restricted cash of $3 million. |
(B) |
Consists of cash and cash
equivalents of $679 million, program cash of $39 million and
restricted cash of $3 million. |
CONSOLIDATED SCHEDULE OF ADJUSTED FREE CASH FLOWS
(C) |
|
|
Three Months Ended March 31, 2020 |
Income before income taxes |
$ |
(265 |
) |
Add-back of
non-vehicle related depreciation and amortization |
69 |
|
Add-back of debt
extinguishment costs |
4 |
|
Add-back of
restructuring and other related costs |
44 |
|
Add-back of
non-operational charges related to shareholder activist
activity |
4 |
|
Add-back of
transaction-related costs |
2 |
|
Add-back of
COVID-19 charges |
7 |
|
Working capital
and other |
76 |
|
Capital
expenditures |
(49 |
) |
Tax payments, net
of refunds |
(5 |
) |
Vehicle programs
and related (D) |
194 |
|
Adjusted
free cash flow |
$ |
81 |
|
|
Acquisition and
related payments, net of acquired cash (E) |
$ |
(30 |
) |
Borrowings, net of
debt repayments |
92 |
|
Restructuring and
other related payments |
(16 |
) |
Transaction-related payments |
(2 |
) |
Non-operational
payments related to shareholder activist activity |
(3 |
) |
Issuance of common
stock |
15 |
|
Repurchases of
common stock |
(118 |
) |
Change in program
cash |
(166 |
) |
Foreign exchange
effects, financing costs and other |
(32 |
) |
Net change
in cash and cash equivalents, program and restricted cash (per
above) |
$ |
(179 |
) |
|
_______ |
(C) |
See Appendix I for the definition
of Adjusted free cash flow. |
(D) |
Includes vehicle-backed
borrowings (repayments) that are incremental to amounts required to
fund incremental (reduced) vehicle and vehicle-related assets. |
(E) |
Excludes $21 million of vehicles
purchased as a part of North America licensee acquisitions, which
were financed through incremental vehicle-backed borrowings. |
Table 4 (page 2 of 2) |
|
|
RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES
TO ADJUSTED FREE CASH FLOW |
|
|
Three Months Ended March 31, 2020 |
Net cash provided by operating activities (per
above) |
$ |
370 |
|
Investing activities of vehicle programs |
(1,390 |
) |
Financing activities of vehicle programs |
976 |
|
Capital expenditures |
(43 |
) |
Proceeds received on sale of assets and nonmarketable equity
securities |
2 |
|
Change in program cash |
166 |
|
Acquisition and disposition-related payments |
(21 |
) |
Non-operational payments related to shareholder activist
activity |
3 |
|
Restructuring and other related payments |
16 |
|
Transaction-related payments |
2 |
|
Adjusted
free cash flow (per above) |
$ |
81 |
|
Table 5 |
Avis Budget Group, Inc. |
DEFINITIONS AND RECONCILIATIONS OF NON-GAAP
MEASURES |
(In millions, except per share data) |
The accompanying press release includes certain
non-GAAP (generally accepted accounting principles) financial
measures as defined under SEC rules. To the extent not provided in
the press release or accompanying tables, we have provided the
reasons we present these non-GAAP financial measures and a
description of what they represent in Appendix I. For each non-GAAP
financial measure a reconciliation to the most comparable GAAP
financial measure is calculated and presented below with
reconciliations of net loss, loss before income taxes and diluted
loss per share to Adjusted EBITDA and our Adjusted earnings
measures.
|
Three Months
Ended March 31, |
Reconciliation of net loss to Adjusted
EBITDA: |
2020 |
|
2019 |
|
|
|
|
|
|
Net loss |
$ |
(158 |
) |
|
$ |
(91 |
) |
|
Benefit from income taxes |
(107 |
) |
|
(45 |
) |
|
Loss before income taxes |
(265 |
) |
|
(136 |
) |
|
|
|
|
|
|
|
Add certain items: |
|
|
|
|
Restructuring and other related charges |
44 |
|
|
21 |
|
|
Acquisition-related amortization expense |
13 |
|
|
17 |
|
|
COVID-19 charges (A) |
7 |
|
|
- |
|
|
Early extinguishment of debt |
4 |
|
|
- |
|
|
Non-operational charges related to shareholder activist activity
(B) |
4 |
|
|
- |
|
|
Transaction-related costs, net |
2 |
|
|
5 |
|
|
Adjusted pretax loss |
(191 |
) |
|
(93 |
) |
|
|
|
|
|
|
Add: |
Non-vehicle related depreciation and amortization (excluding
acquisition-related amortization expense) |
56 |
|
|
50 |
|
|
|
Interest expense related to corporate debt, net (excluding
early extinguishment of debt) |
48 |
|
|
42 |
|
|
Adjusted EBITDA |
$ |
(87 |
) |
|
$ |
(1 |
) |
|
|
|
|
|
|
Reconciliation of net loss to adjusted net
loss: |
|
|
|
|
|
|
|
|
Net loss |
$ |
(158 |
) |
|
$ |
(91 |
) |
|
Add certain items, net of tax: |
|
|
|
|
|
Restructuring and other related charges |
33 |
|
|
16 |
|
|
|
Acquisition-related amortization expense |
10 |
|
|
12 |
|
|
|
COVID-19 charges |
5 |
|
|
- |
|
|
|
Early extinguishment of debt |
3 |
|
|
- |
|
|
|
Non-operational charges related to shareholder activist
activity |
3 |
|
|
- |
|
|
|
Transaction-related costs, net |
1 |
|
|
4 |
|
|
Adjusted net loss |
$ |
(103 |
) |
|
$ |
(59 |
) |
|
|
|
|
|
|
|
Loss per share - Diluted |
$ |
(2.16 |
) |
|
$ |
(1.20 |
) |
|
|
|
|
|
|
|
Adjusted diluted loss per
share |
$ |
(1.40 |
) |
|
$ |
(0.78 |
) |
|
|
|
|
|
|
|
Shares used to calculate Adjusted diluted
loss per share |
72.9 |
|
|
75.8 |
|
_______ |
(A) |
Reported within operating expenses in our Consolidated Statements
of Operations. |
(B) |
Reported within
selling, general and administrative expenses in our Consolidated
Statements of Operations. |
Table 6 |
Avis Budget Group, Inc. |
KEY METRICS CALCULATIONS |
($ in millions, except as noted) |
|
|
Three Months Ended March 31, 2020 |
|
Three Months Ended March 31, 2019 |
|
Americas |
|
International |
|
Total |
|
Americas |
|
International |
|
Total |
Revenue per Day
(RPD) |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
1,257 |
|
|
$ |
496 |
|
|
$ |
1,753 |
|
|
$ |
1,327 |
|
|
$ |
593 |
|
|
$ |
1,920 |
|
Currency exchange rate effects |
- |
|
|
20 |
|
|
20 |
|
|
- |
|
|
- |
|
|
- |
|
Revenue excluding exchange rate effects |
1,257 |
|
|
516 |
|
|
1,773 |
|
|
1,327 |
|
|
593 |
|
|
1,920 |
|
Rental days (000's) |
23,458 |
|
|
11,067 |
|
|
34,525 |
|
|
24,709 |
|
|
12,456 |
|
|
37,165 |
|
RPD excluding exchange rate effects (in $'s) |
$ |
53.61 |
|
|
$ |
46.61 |
|
|
$ |
51.36 |
|
|
$ |
53.74 |
|
|
$ |
47.59 |
|
|
$ |
51.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle
Utilization |
|
|
|
|
|
|
|
|
|
|
|
Rental days (000's) |
23,458 |
|
|
11,067 |
|
|
34,525 |
|
|
24,709 |
|
|
12,456 |
|
|
37,165 |
|
Average rental fleet |
416,937 |
|
|
192,755 |
|
|
609,692 |
|
|
397,008 |
|
|
197,693 |
|
|
594,701 |
|
Number of days in period |
91 |
|
|
91 |
|
|
91 |
|
|
90 |
|
|
90 |
|
|
90 |
|
Available rental days (000's) |
37,941 |
|
|
17,541 |
|
|
55,482 |
|
|
35,731 |
|
|
17,792 |
|
|
53,523 |
|
Vehicle utilization |
61.8 |
% |
|
63.1 |
% |
|
62.2 |
% |
|
69.2 |
% |
|
70.0 |
% |
|
69.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Per-Unit Fleet
Costs |
|
|
|
|
|
|
|
|
|
|
|
Vehicle depreciation and lease charges, net |
$ |
332 |
|
|
$ |
127 |
|
|
$ |
459 |
|
|
$ |
353 |
|
|
$ |
132 |
|
|
$ |
485 |
|
Currency exchange rate effects |
- |
|
|
5 |
|
|
5 |
|
|
- |
|
|
- |
|
|
- |
|
|
$ |
332 |
|
|
$ |
132 |
|
|
$ |
464 |
|
|
$ |
353 |
|
|
$ |
132 |
|
|
$ |
485 |
|
Average rental fleet |
416,937 |
|
|
192,755 |
|
|
609,692 |
|
|
397,008 |
|
|
197,693 |
|
|
594,701 |
|
Per-unit fleet costs (in $'s) |
$ |
797 |
|
|
$ |
682 |
|
|
$ |
760 |
|
|
$ |
890 |
|
|
$ |
668 |
|
|
$ |
816 |
|
Number of months in period |
3 |
|
|
3 |
|
|
3 |
|
|
3 |
|
|
3 |
|
|
3 |
|
Per-unit fleet costs per month excluding exchange rate effects (in
$'s) |
$ |
266 |
|
|
$ |
227 |
|
|
$ |
253 |
|
|
$ |
297 |
|
|
$ |
223 |
|
|
$ |
272 |
|
_______ |
Our calculation of
rental days and revenue per day may not be comparable to the
calculation of similarly-titled metrics by other companies.
Currency exchange rate effects are calculated by translating the
current-year results at the prior-period average exchange rates
plus any related gains and losses on currency hedges. |
Appendix I |
Avis Budget Group, Inc. |
DEFINITIONS OF NON-GAAP MEASURES AND KEY
METRICS |
Adjusted EBITDAThe accompanying press release
presents Adjusted EBITDA, which represents income (loss) from
continuing operations before non-vehicle related depreciation and
amortization, any impairment charges, restructuring and other
related charges, early extinguishment of debt costs, non-vehicle
related interest, transaction-related costs, net charges for
unprecedented personal-injury legal matters, non-operational
charges related to shareholder activist activity, gain on sale of
equity method investment in China, COVID-19 charges and income
taxes. Net charges for unprecedented personal-injury legal matters
and gain on sale of equity method investment in China are recorded
within operating expenses in our consolidated condensed statement
of operations. Non-operational charges related to shareholder
activist activity include third party advisory, legal and other
professional service fees and are recorded within selling, general
and administrative expenses in our consolidated results of
operations. COVID-19 charges include unusual, direct and
incremental costs due to COVID-19 global pandemic such as overflow
parking for idle vehicles, incremental cleaning supplies to
sanitize vehicles and facilities, and losses associated with
vehicles damaged in overflow parking lots and are recorded within
operating expenses in our consolidated condensed statement of
operations. We have revised our definition of Adjusted EBITDA to
exclude COVID-19. We did not revised prior years' Adjusted EBITDA
amounts because there were no other charges similar in nature to
these. Adjusted EBITDA includes stock-based compensation expense
and deferred financing fee amortization totaling $4 million and $11
million in first quarter 2020 and 2019, respectively.
We believe that Adjusted EBITDA is useful to investors as a
supplemental measure in evaluating the aggregate performance of our
operating businesses and in comparing our results from period to
period. Adjusted EBITDA is the measure that is used by our
management, including our chief operating decision maker, to
perform such evaluation. Adjusted EBITDA is also a component in the
determination of management's compensation. Adjusted EBITDA should
not be considered in isolation or as a substitute for net income or
other income statement data prepared in accordance with GAAP and
our presentation of Adjusted EBITDA may not be comparable to
similarly-titled measures used by other companies. A reconciliation
of Adjusted EBITDA from net income (loss) recognized under GAAP is
provided on Table 5.
Adjusted Earnings Non-GAAP MeasuresThe
accompanying press release and tables present Adjusted pretax
income (loss), Adjusted net income (loss) and Adjusted diluted
earnings (loss) per share, which exclude certain items. We believe
that these measures referred to above are useful to investors as
supplemental measures in evaluating the aggregate performance of
the Company. We exclude restructuring and other related charges,
transaction-related costs, costs related to early extinguishment of
debt and certain other items as such items are not representative
of the results of operations of our business less a provision for
income taxes derived utilizing applicable statutory tax rates for
each item. A reconciliation of our Adjusted earnings Non-GAAP
measures from the appropriate measures recognized under GAAP is
provided on Table 5.
Adjusted Free Cash FlowRepresents Net Cash
Provided by Operating Activities adjusted to reflect the cash
inflows and outflows relating to capital expenditures, the
investing and financing activities of our vehicle programs, asset
sales, if any, and to exclude debt extinguishment costs,
transaction-related costs, restructuring and other related charges,
COVID-19 charges and non-operational charges related to shareholder
activist activity. We have revised our definition of Adjusted Free
Cash Flow to exclude COVID-19 charges and have not revised prior
years' Adjusted Free Cash Flow amounts as there were not other
charges similar in nature these. We believe this change is
meaningful to investors as it brings the measurement in line with
our other non-GAAP measures. We believe that Adjusted Free Cash
Flow is useful to management and investors in measuring the cash
generated that is available to be used to repay debt obligations,
repurchase stock, pay dividends and invest in future growth through
new business development activities or acquisitions. Adjusted Free
Cash Flow should not be construed as a substitute in measuring
operating results or liquidity, and our presentation of Adjusted
Free Cash Flow may not be comparable to similarly-titled measures
used by other companies. A reconciliation of Adjusted Free Cash
Flow to the appropriate measure recognized under GAAP is provided
on Table 4.
Available Rental DaysDefined as Average Rental
Fleet times the numbers of days in a given period.
Average Rental FleetRepresents the average
number of vehicles in our fleet during a given period of time.
Currency Exchange Rate EffectsRepresents the
difference between current-period results as reported and
current-period results translated at the prior-period average
exchange rates plus any related currency hedges.
Net Corporate DebtRepresents corporate debt
minus cash and cash equivalents.
Net Corporate LeverageRepresents Net Corporate
Debt divided by Adjusted EBITDA for the twelve months prior to the
date of calculation.
Per-Unit Fleet CostsRepresents vehicle
depreciation, lease charges and gain or loss on vehicles sales,
divided by Average Rental Fleet.
Rental DaysRepresents the total number of days
(or portion thereof) a vehicle was rented during a 24-hour
period.
Revenue per DayRepresents revenues divided by
Rental Days.
Vehicle UtilizationRepresents Rental Days
divided by Available Rental Days.
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