Avis Budget Group, Inc. (
NASDAQ: CAR) today
announced financial results for fourth quarter and full year ended
December 31, 2022.
We ended 2022 with fourth quarter revenues 8%
above prior year and 28% above fourth quarter 2019, at $2.8
billion. Our revenues were driven by increased revenue per day and
strong demand from both our commercial business and leisure holiday
travel. Net income was $424 million and Adjusted EBITDA1 was $658
million. Utilization for the quarter was 67.0%, showing that our
fleet continues to be well positioned to meet demand.
Full year revenues increased 29% compared to the
prior year and 31% compared to 2019, at $12.0 billion. Net income
was $2.8 billion and Adjusted EBITDA was $4.1 billion, both full
year records for the Company.
Our liquidity position at the end of the quarter
was approximately $1.6 billion with an additional $1.9 billion of
fleet funding capacity. We have well-laddered corporate debt and no
meaningful maturities until 2024.
"Our fourth quarter demand was strong with our
commercial business performing well above 2019 levels, and the
leisure segment continuing its strong performance, especially over
the holiday period. These trends have continued into the first
quarter,” said Joe Ferraro, Avis Budget Group Chief Executive
Officer. “2022 was a record setting year for our Company, and I
want to thank our team, all around the world, for their outstanding
efforts and look forward to another successful year in 2023.”
Q4 and Full Year Highlights
- Total Company
revenues was $2.8 billion for the fourth quarter and $12.0 billion
for the year ended 2022 driven by strong demand and pricing. It is
the best full year revenue in the Company's history.
- Adjusted EBITDA in
the Americas was $624 million for the fourth quarter and $3.7
billion for the year ended 2022 driven by record demand. It is the
best full year Adjusted EBITDA in Americas' history.
- Adjusted EBITDA in
International was $63 million for the fourth quarter and $560
million for the year ended 2022 driven by increased pricing and
return of demand. It is the best full year Adjusted EBITDA in
International's history.
- Our Board of
Directors approved a $1 billion increase to our existing share
repurchase authorization in February.
______________________1 Adjusted EBITDA,
as well as certain other measures in this release, is a non-GAAP
financial measure. See "Non-GAAP Measures and Key Metrics" and the
tables that accompany this release for how we define these measures
and reconciliations of these non-GAAP measures to the closest
comparable GAAP measures.
Investor Conference Call
We will host a conference call to discuss fourth
quarter and full year ended December 31, 2022 results on
February 14, 2023, at 8:30 a.m. (ET). Investors may access the call
at ir.avisbudgetgroup.com or by dialing (877) 407-2991 and a replay
will be available on our website and at (877) 660-6853 using
conference code 13735409.
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 10,000 rental locations in
approximately 180 countries around the world, and through its
Zipcar brand, which is the world's leading car sharing network.
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, future demand for our services, and global
economic conditions 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, COVID-19, which has had, and is
expected to continue to have, a significant impact on our
operations, and resulting economic conditions and related
restrictions, the high level of competition in the mobility
industry, changes in our fleet costs, including 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, our ability to achieve and maintain cost savings, the
financial condition of the manufacturers that supply our rental
vehicles, including as a result of the global semiconductor
shortage, which could affect their ability to perform their
obligations under our repurchase and/or guaranteed depreciation
arrangements, the significant volatility in travel demand as a
result of COVID-19, the absence of an improvement in or any further
deterioration in economic conditions generally, particularly during
our peak season and/or in key market segments, any occurrence or
threat of terrorism, the current and any future pandemic diseases
or other natural disasters, any changes to the cost or supply of
fuel, risks related to acquisitions or integration of acquired
businesses, risks associated with litigation, including class
action lawsuits, governmental or regulatory inquiries or
investigations, risks related to the security of our and our
business partners' 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. Other unknown or
unpredictable factors could also have material adverse effects on
the Company’s performance or achievements, such as the potential
effects on the world economy and markets, elections and government
shutdowns as a result of the ongoing military conflict between
Russia and Ukraine. 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, 2021, Quarterly Report on Form 10-Q for the three
and nine months ended September 30, 2022 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, Adjusted net income and Adjusted free cash flow,
as well as other financial measures that are not considered
generally accepted accounting principles (“GAAP”) measures as
defined under SEC rules. Important information regarding such
measures is contained in the financial tables to this release and
in Appendix I, including the definitions of these measures and
reconciliations to the closest comparable GAAP measures. The
Company and its management believe that these non-GAAP measures are
useful to investors as supplemental measures in comparing our
results period over period. These non-GAAP measures have
limitations as analytical tools, and you should not consider them
in isolation or as alternatives to GAAP measures. 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) attributable to Avis Budget Group,
Inc. and diluted earnings (loss) per share, respectively. Foreign
currency translation effects on our 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.
ContactInvestor Relations
Contact:David CalabriaIR@avisbudget.com
Media Relations Contact:James
TomlinsonABGPress@edelman.com
Tables Follow
|
Table 1 |
|
Avis Budget Group, Inc.SUMMARY DATA
SHEET(In millions, except per share
data) |
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
2022 |
|
|
2021 |
|
% Change |
Income Statement and Other Items |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
$ |
2,771 |
|
|
$ |
2,569 |
|
|
8 |
% |
|
$ |
11,994 |
|
$ |
9,313 |
|
29 |
% |
Income before income taxes |
|
516 |
|
|
|
543 |
|
|
(5 |
)% |
|
|
3,636 |
|
|
1,708 |
|
113 |
% |
Net income |
|
424 |
|
|
|
381 |
|
|
11 |
% |
|
|
2,756 |
|
|
1,283 |
|
115 |
% |
Earnings per share - diluted |
|
10.10 |
|
|
|
6.63 |
|
|
52 |
% |
|
|
57.16 |
|
|
19.44 |
|
194 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Earnings Measures (non-GAAP)
(A) |
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
$ |
658 |
|
|
$ |
683 |
|
|
(4 |
)% |
|
$ |
4,133 |
|
$ |
2,411 |
|
71 |
% |
Adjusted pretax income |
|
536 |
|
|
|
578 |
|
|
(7 |
)% |
|
|
3,691 |
|
|
1,980 |
|
86 |
% |
Adjusted net income |
|
438 |
|
|
|
408 |
|
|
7 |
% |
|
|
2,807 |
|
|
1,486 |
|
89 |
% |
Adjusted earnings per share - diluted |
|
10.46 |
|
|
|
7.08 |
|
|
48 |
% |
|
|
58.05 |
|
|
22.49 |
|
158 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
|
|
|
|
|
|
December 31, 2022 |
|
December 31, 2021 |
|
|
|
|
|
|
|
|
Balance Sheet Items |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
570 |
|
|
$ |
534 |
|
|
|
|
|
|
|
|
|
Vehicles, net |
|
15,961 |
|
|
|
12,866 |
|
|
|
|
|
|
|
|
|
Debt under vehicle programs |
|
13,809 |
|
|
|
11,390 |
|
|
|
|
|
|
|
|
|
Corporate debt |
|
4,671 |
|
|
|
4,009 |
|
|
|
|
|
|
|
|
|
Stockholders' equity attributable to Avis Budget Group, Inc. |
|
(703 |
) |
|
|
(220 |
) |
|
|
|
|
|
|
|
|
Segment Results |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
Revenues |
|
|
|
|
|
|
|
|
|
|
|
Americas |
$ |
2,204 |
|
|
$ |
2,100 |
|
|
5 |
% |
|
$ |
9,474 |
|
|
$ |
7,557 |
|
|
25 |
% |
International |
|
567 |
|
|
|
469 |
|
|
21 |
% |
|
|
2,520 |
|
|
|
1,756 |
|
|
44 |
% |
Corporate and Other |
|
— |
|
|
|
— |
|
|
n/m |
|
|
|
— |
|
|
|
— |
|
|
n/m |
|
Total Company |
$ |
2,771 |
|
|
$ |
2,569 |
|
|
8 |
% |
|
$ |
11,994 |
|
|
$ |
9,313 |
|
|
29 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
Americas |
$ |
624 |
|
|
$ |
670 |
|
|
(7 |
)% |
|
$ |
3,660 |
|
|
$ |
2,364 |
|
|
55 |
% |
International |
|
63 |
|
|
|
32 |
|
|
97 |
% |
|
|
560 |
|
|
|
118 |
|
|
375 |
% |
Corporate and Other |
|
(29 |
) |
|
|
(19 |
) |
|
53 |
% |
|
|
(87 |
) |
|
|
(71 |
) |
|
23 |
% |
Total Company |
$ |
658 |
|
|
$ |
683 |
|
|
(4 |
)% |
|
$ |
4,133 |
|
|
$ |
2,411 |
|
|
71 |
% |
_______ |
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 December 31, |
|
Year Ended December 31, |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Revenues |
$ |
2,771 |
|
$ |
2,569 |
|
|
$ |
11,994 |
|
|
$ |
9,313 |
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
Operating |
|
1,325 |
|
|
1,166 |
|
|
|
5,285 |
|
|
|
4,255 |
|
Vehicle depreciation and lease charges, net |
|
349 |
|
|
328 |
|
|
|
828 |
|
|
|
1,197 |
|
Selling, general and administrative |
|
322 |
|
|
308 |
|
|
|
1,348 |
|
|
|
1,145 |
|
Vehicle interest, net |
|
121 |
|
|
81 |
|
|
|
402 |
|
|
|
313 |
|
Non-vehicle related depreciation and amortization |
|
57 |
|
|
73 |
|
|
|
225 |
|
|
|
272 |
|
Interest expense related to corporate debt, net: |
|
|
|
|
|
|
|
Interest expense |
|
69 |
|
|
51 |
|
|
|
250 |
|
|
|
218 |
|
Early extinguishment of debt |
|
— |
|
|
— |
|
|
|
— |
|
|
|
136 |
|
Restructuring and other related charges |
|
3 |
|
|
17 |
|
|
|
19 |
|
|
|
64 |
|
Transaction-related costs, net |
|
7 |
|
|
2 |
|
|
|
8 |
|
|
|
5 |
|
Other (income) expense, net |
|
2 |
|
|
— |
|
|
|
(7 |
) |
|
|
— |
|
Total expenses |
|
2,255 |
|
|
2,026 |
|
|
|
8,358 |
|
|
|
7,605 |
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
516 |
|
|
543 |
|
|
|
3,636 |
|
|
|
1,708 |
|
Provision for income taxes |
|
92 |
|
|
162 |
|
|
|
880 |
|
|
|
425 |
|
Net income |
|
424 |
|
|
381 |
|
|
|
2,756 |
|
|
|
1,283 |
|
Less: income (loss) attributable to non-controlling interests |
|
1 |
|
|
(1 |
) |
|
|
(8 |
) |
|
|
(2 |
) |
Net income attributable to Avis Budget Group,
Inc. |
$ |
423 |
|
$ |
382 |
|
|
$ |
2,764 |
|
|
$ |
1,285 |
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
Basic |
$ |
10.32 |
|
$ |
6.78 |
|
|
$ |
58.41 |
|
|
$ |
19.79 |
|
Diluted |
$ |
10.10 |
|
$ |
6.63 |
|
|
$ |
57.16 |
|
|
$ |
19.44 |
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding |
|
|
|
|
|
|
|
Basic |
|
41.0 |
|
|
56.4 |
|
|
|
47.3 |
|
|
|
64.9 |
|
Diluted |
|
41.9 |
|
|
57.7 |
|
|
|
48.4 |
|
|
|
66.1 |
|
|
Table 3 |
|
Avis Budget Group, Inc.KEY METRICS
SUMMARY |
|
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
|
|
29,226 |
|
|
|
27,996 |
|
|
4% |
|
|
121,917 |
|
|
|
99,763 |
|
|
22% |
Revenue per Day, excluding exchange rate effects
(A) |
|
$ |
75.64 |
|
|
$ |
75.02 |
|
|
1% |
|
$ |
77.85 |
|
|
$ |
75.75 |
|
|
3% |
Average Rental Fleet |
|
|
467,331 |
|
|
|
435,403 |
|
|
7% |
|
|
479,672 |
|
|
|
385,610 |
|
|
24% |
Vehicle Utilization |
|
|
68.0 |
% |
|
|
69.9 |
% |
|
(1.9) pps |
|
|
69.6 |
% |
|
|
70.9 |
% |
|
(1.3) pps |
Per-Unit Fleet Costs per Month, excluding exchange rate effects
(A) |
|
$ |
176 |
|
|
$ |
170 |
|
|
4% |
|
$ |
72 |
|
|
$ |
184 |
|
|
(61)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
|
|
10,680 |
|
|
|
9,251 |
|
|
15% |
|
|
43,100 |
|
|
|
34,931 |
|
|
23% |
Revenue per Day, excluding exchange rate effects
(A) |
|
$ |
59.89 |
|
|
$ |
50.69 |
|
|
18% |
|
$ |
65.65 |
|
|
$ |
50.27 |
|
|
31% |
Average Rental Fleet |
|
|
180,297 |
|
|
|
157,883 |
|
|
14% |
|
|
174,708 |
|
|
|
143,300 |
|
|
22% |
Vehicle Utilization |
|
|
64.4 |
% |
|
|
63.7 |
% |
|
0.7 pps |
|
|
67.6 |
% |
|
|
66.8 |
% |
|
0.8 pps |
Per-Unit Fleet Costs per Month, excluding exchange rate effects
(A) |
|
$ |
215 |
|
|
$ |
225 |
|
|
(4)% |
|
$ |
221 |
|
|
$ |
201 |
|
|
10% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
|
|
39,906 |
|
|
|
37,247 |
|
|
7% |
|
|
165,017 |
|
|
|
134,694 |
|
|
23% |
Revenue per Day, excluding exchange rate effects
(A) |
|
$ |
71.43 |
|
|
$ |
68.97 |
|
|
4% |
|
$ |
74.67 |
|
|
$ |
69.14 |
|
|
8% |
Average Rental Fleet |
|
|
647,628 |
|
|
|
593,286 |
|
|
9% |
|
|
654,380 |
|
|
|
528,910 |
|
|
24% |
Vehicle Utilization |
|
|
67.0 |
% |
|
|
68.2 |
% |
|
(1.2) pps |
|
|
69.1 |
% |
|
|
69.8 |
% |
|
(0.7) pps |
Per-Unit Fleet Costs per Month, excluding exchange rate effects
(A) |
|
$ |
187 |
|
|
$ |
185 |
|
|
1% |
|
$ |
112 |
|
|
$ |
189 |
|
|
(41)% |
_______ |
|
|
|
|
|
|
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 December 31, |
|
Year Ended December 31, |
|
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
2022 |
|
|
|
2021 |
|
|
% Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue per Day |
|
$ |
75.40 |
|
|
$ |
75.02 |
|
|
1% |
|
$ |
77.71 |
|
|
$ |
75.75 |
|
|
3% |
Per-Unit Fleet Costs per Month |
|
$ |
175 |
|
|
$ |
170 |
|
|
3% |
|
$ |
72 |
|
|
$ |
184 |
|
|
(61)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue per Day |
|
$ |
53.20 |
|
|
$ |
50.69 |
|
|
5% |
|
$ |
58.48 |
|
|
$ |
50.27 |
|
|
16% |
Per-Unit Fleet Costs per Month |
|
$ |
192 |
|
|
$ |
225 |
|
|
(15)% |
|
$ |
198 |
|
|
$ |
201 |
|
|
(1)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue per Day |
|
$ |
69.46 |
|
|
$ |
68.97 |
|
|
1% |
|
$ |
72.68 |
|
|
$ |
69.14 |
|
|
5% |
Per-Unit Fleet Costs per Month |
|
$ |
180 |
|
|
$ |
185 |
|
|
(3)% |
|
$ |
105 |
|
|
$ |
189 |
|
|
(44)% |
|
Table 4 |
|
Avis Budget Group, Inc.CONSOLIDATED
CONDENSED SCHEDULES OF CASH FLOWS AND ADJUSTED FREE CASH
FLOWS(In millions) |
|
CONSOLIDATED CONDENSED SCHEDULE OF CASH FLOWS |
Year Ended December 31, 2022 |
Operating Activities |
|
Net cash provided by operating activities |
$ |
4,707 |
|
Investing Activities |
|
Net cash used in investing activities exclusive of vehicle
programs |
|
(280 |
) |
Net cash used in investing activities of vehicle programs |
|
(4,019 |
) |
Net cash used in investing activities |
|
(4,299 |
) |
Financing Activities |
|
Net cash used in financing activities exclusive of vehicle
programs |
|
(2,592 |
) |
Net cash provided by financing activities of vehicle programs |
|
2,232 |
|
Net cash used in financing activities |
|
(360 |
) |
Effect of changes in exchange rates on cash and cash equivalents,
program and restricted cash |
|
(32 |
) |
Net change in cash and cash equivalents, program and restricted
cash |
|
16 |
|
Cash and cash equivalents, program and restricted cash,
beginning of period (A) |
|
626 |
|
Cash and cash equivalents, program and restricted cash, end
of period (B) |
$ |
642 |
|
CONSOLIDATED SCHEDULE OF ADJUSTED FREE CASH FLOWS
(C) |
Year Ended December 31, 2022 |
Income before income taxes |
$ |
3,636 |
|
Add-back of non-vehicle related depreciation and amortization
(D) |
|
235 |
|
Add-back of restructuring and other related costs |
|
19 |
|
Add-back of transaction-related costs, net |
|
8 |
|
Add-back of other (income) expense, net |
|
(7 |
) |
Add-back of COVID-19 charges, net |
|
(9 |
) |
Add-back of unprecedented personal-injury and other legal matters,
net |
|
1 |
|
Working capital and other |
|
148 |
|
Capital expenditures (E) |
|
(304 |
) |
Tax payments, net of refunds |
|
(192 |
) |
Vehicle programs and related (F) |
|
(810 |
) |
Adjusted free cash flow |
$ |
2,725 |
|
Acquisition and related payments, net of acquired cash |
|
(3 |
) |
Borrowings, net of debt repayments |
|
704 |
|
Repurchases of common stock |
|
(3,329 |
) |
Change in program and restricted cash |
|
(16 |
) |
Other receipts (payments), net |
|
(13 |
) |
Foreign exchange effects, financing costs and other |
|
(52 |
) |
Net change in cash and cash equivalents, program and
restricted cash (per above) |
$ |
16 |
|
Reconciliation of Net cash provided by operating activities
to Adjusted free cash flow: |
Year Ended December 31, 2022 |
Net cash provided by operating activities (per
above) |
$ |
4,707 |
|
Investing activities of vehicle programs |
|
(4,019 |
) |
Financing activities of vehicle programs |
|
2,232 |
|
Capital expenditures |
|
(246 |
) |
Proceeds received on sale of assets and nonmarketable equity
securities |
|
2 |
|
Acquisition and disposition-related payments |
|
20 |
|
Change in program and restricted cash |
|
16 |
|
Other receipts (payments), net |
|
13 |
|
Adjusted free cash flow (per above) |
$ |
2,725 |
|
|
_______ |
(A) |
Consists of cash and cash equivalents, program cash and restricted
cash of $534 million, $89 million and $3 million,
respectively. |
(B) |
Consists of cash and cash equivalents, program cash and restricted
cash of $570 million, $70 million and $2 million,
respectively. |
(C) |
See Appendix I for the definition of Adjusted free cash flow. |
(D) |
Includes $10 million of cloud computing costs. |
(E) |
Includes $58 million of cloud computing implementation costs. |
(F) |
Includes vehicle-backed borrowings (repayments) that are
incremental to amounts required to fund incremental (reduced)
vehicle and vehicle-related assets. Also includes $17 million of
vehicles sold in the divestiture of our operations in the United
States Virgin Islands and the Netherlands. |
|
|
|
|
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 income (loss), income (loss) before income
taxes and diluted earnings (loss) per share to Adjusted EBITDA and
our Adjusted earnings measures.
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
Reconciliation of Net income to Adjusted
EBITDA: |
2022 |
|
2021 |
|
2022 |
|
2021 |
|
|
|
|
|
|
|
|
Net income |
$ |
424 |
|
$ |
381 |
|
|
$ |
2,756 |
|
|
$ |
1,283 |
|
Add: |
Provision for income taxes |
|
92 |
|
|
162 |
|
|
|
880 |
|
|
|
425 |
|
Income before income taxes |
|
516 |
|
|
543 |
|
|
|
3,636 |
|
|
|
1,708 |
|
Add certain items: |
|
|
|
|
|
|
|
Acquisition-related amortization expense |
|
8 |
|
|
21 |
|
|
|
43 |
|
|
|
66 |
|
Restructuring and other related charges |
|
3 |
|
|
17 |
|
|
|
19 |
|
|
|
64 |
|
Transaction-related costs, net |
|
7 |
|
|
2 |
|
|
|
8 |
|
|
|
5 |
|
Other (income) expense, net |
|
2 |
|
|
— |
|
|
|
(7 |
) |
|
|
— |
|
Early extinguishment of debt |
|
— |
|
|
— |
|
|
|
— |
|
|
|
136 |
|
COVID-19 charges, net (A) |
|
— |
|
|
(14 |
) |
|
|
(9 |
) |
|
|
(2 |
) |
Unprecedented personal-injury and other legal matters, net (B) |
|
— |
|
|
9 |
|
|
|
1 |
|
|
|
3 |
|
Adjusted pretax income |
|
536 |
|
|
578 |
|
|
|
3,691 |
|
|
|
1,980 |
|
Add: |
Non-vehicle related depreciation and amortization (excluding
acquisition-related amortization expense) (C) |
|
53 |
|
|
54 |
|
|
|
192 |
|
|
|
213 |
|
|
Interest expense related to corporate debt, net (excluding early
extinguishment of debt) |
|
69 |
|
|
51 |
|
|
|
250 |
|
|
|
218 |
|
Adjusted EBITDA |
$ |
658 |
|
$ |
683 |
|
|
$ |
4,133 |
|
|
$ |
2,411 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net income attributable to Avis Budget
Group, Inc. to Adjusted net income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to Avis Budget Group,
Inc. |
$ |
423 |
|
$ |
382 |
|
|
$ |
2,764 |
|
|
$ |
1,285 |
|
Add certain items, net of tax: |
|
|
|
|
|
|
|
Acquisition-related amortization expense |
|
7 |
|
|
17 |
|
|
|
32 |
|
|
|
50 |
|
Restructuring and other related charges |
|
2 |
|
|
12 |
|
|
|
16 |
|
|
|
47 |
|
Transaction-related costs, net |
|
4 |
|
|
1 |
|
|
|
5 |
|
|
|
3 |
|
Other (income) expense, net |
|
2 |
|
|
— |
|
|
|
(5 |
) |
|
|
— |
|
Early extinguishment of debt |
|
— |
|
|
— |
|
|
|
— |
|
|
|
101 |
|
COVID-19 charges, net |
|
— |
|
|
(10 |
) |
|
|
(6 |
) |
|
|
(2 |
) |
Unprecedented personal-injury and other legal matters, net |
|
— |
|
|
6 |
|
|
|
1 |
|
|
|
2 |
|
Adjusted net income |
$ |
438 |
|
$ |
408 |
|
|
$ |
2,807 |
|
|
$ |
1,486 |
|
|
|
|
|
|
|
|
|
|
Earnings per share - diluted |
$ |
10.10 |
|
$ |
6.63 |
|
|
$ |
57.16 |
|
|
$ |
19.44 |
|
Adjusted diluted earnings per share |
$ |
10.46 |
|
$ |
7.08 |
|
|
$ |
58.05 |
|
|
$ |
22.49 |
|
Shares used to calculate Adjusted diluted earnings per
share |
|
41.9 |
|
|
57.7 |
|
|
|
48.4 |
|
|
|
66.1 |
|
_______ |
|
|
|
|
|
|
|
(A) |
The following table presents the unusual, direct and incremental
costs due to the COVID-19 pandemic: |
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
Minimum annual guaranteed rent in excess of concession fees,
net |
$ |
— |
|
$ |
(14 |
) |
|
$ |
(9 |
) |
|
$ |
(2 |
) |
|
Vehicles damaged in overflow parking lots, net of insurance
proceeds |
|
— |
|
|
— |
|
|
|
— |
|
|
|
(7 |
) |
|
Other charges |
|
— |
|
|
— |
|
|
|
— |
|
|
|
7 |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
— |
|
|
(14 |
) |
|
|
(9 |
) |
|
|
(3 |
) |
|
Selling, general and administrative expenses |
|
— |
|
|
— |
|
|
|
— |
|
|
|
1 |
|
|
COVID-19 charges, net |
$ |
— |
|
$ |
(14 |
) |
|
$ |
(9 |
) |
|
$ |
(2 |
) |
|
|
|
|
|
|
|
|
|
(B) |
Reported within operating expenses in our Consolidated Statements
of Operations. |
(C) |
Operating expenses in our Consolidated Statements of Operations
related to cloud computing costs totaling $4 million and $2 million
in fourth quarter 2022 and 2021, respectively and totaling $10
million and $7 million in the year ended December 31, 2022 and
2021, respectively. |
|
Table 6 |
|
Avis Budget Group, Inc.KEY METRICS
CALCULATIONS($ in millions, except as
noted) |
|
|
Three Months Ended December 31, 2022 |
|
Three Months Ended December 31, 2021 |
|
Americas |
|
International |
|
Total |
|
Americas |
|
International |
|
Total |
Revenue per Day (RPD) |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
2,204 |
|
|
$ |
567 |
|
|
$ |
2,771 |
|
|
$ |
2,100 |
|
|
$ |
469 |
|
|
$ |
2,569 |
|
Currency exchange rate effects |
|
7 |
|
|
|
73 |
|
|
|
80 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Revenue excluding exchange rate effects |
|
2,211 |
|
|
|
640 |
|
|
|
2,851 |
|
|
|
2,100 |
|
|
|
469 |
|
|
|
2,569 |
|
Rental days (000's) |
|
29,226 |
|
|
|
10,680 |
|
|
|
39,906 |
|
|
|
27,996 |
|
|
|
9,251 |
|
|
|
37,247 |
|
RPD excluding exchange rate effects (in $'s) |
$ |
75.64 |
|
|
$ |
59.89 |
|
|
$ |
71.43 |
|
|
$ |
75.02 |
|
|
$ |
50.69 |
|
|
$ |
68.97 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization |
|
|
|
|
|
|
|
|
|
|
|
Rental days (000's) |
|
29,226 |
|
|
|
10,680 |
|
|
|
39,906 |
|
|
|
27,996 |
|
|
|
9,251 |
|
|
|
37,247 |
|
Average rental fleet |
|
467,331 |
|
|
|
180,297 |
|
|
|
647,628 |
|
|
|
435,403 |
|
|
|
157,883 |
|
|
|
593,286 |
|
Number of days in period |
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
|
92 |
|
Available rental days (000's) |
|
42,995 |
|
|
|
16,587 |
|
|
|
59,582 |
|
|
|
40,057 |
|
|
|
14,525 |
|
|
|
54,582 |
|
Vehicle utilization |
|
68.0 |
% |
|
|
64.4 |
% |
|
|
67.0 |
% |
|
|
69.9 |
% |
|
|
63.7 |
% |
|
|
68.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Per-Unit Fleet Costs |
|
|
|
|
|
|
|
|
|
|
|
Vehicle depreciation and lease charges, net |
$ |
245 |
|
|
$ |
104 |
|
|
$ |
349 |
|
|
$ |
222 |
|
|
$ |
106 |
|
|
$ |
328 |
|
Currency exchange rate effects |
|
2 |
|
|
|
12 |
|
|
|
14 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
$ |
247 |
|
|
$ |
116 |
|
|
$ |
363 |
|
|
$ |
222 |
|
|
$ |
106 |
|
|
$ |
328 |
|
Average rental fleet |
|
467,331 |
|
|
|
180,297 |
|
|
|
647,628 |
|
|
|
435,403 |
|
|
|
157,883 |
|
|
|
593,286 |
|
Per-unit fleet costs (in $'s) |
$ |
528 |
|
|
$ |
646 |
|
|
$ |
560 |
|
|
$ |
510 |
|
|
$ |
674 |
|
|
$ |
554 |
|
Number of months in period |
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
|
3 |
|
Per-unit fleet costs per month excluding exchange rate effects (in
$'s) |
$ |
176 |
|
|
$ |
215 |
|
|
$ |
187 |
|
|
$ |
170 |
|
|
$ |
225 |
|
|
$ |
185 |
|
|
Year Ended December 31, 2022 |
|
Year Ended December 31, 2021 |
|
Americas |
|
International |
|
Total |
|
Americas |
|
International |
|
Total |
Revenue per Day (RPD) |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
9,474 |
|
|
$ |
2,520 |
|
|
$ |
11,994 |
|
|
$ |
7,557 |
|
|
$ |
1,756 |
|
|
$ |
9,313 |
|
Currency exchange rate effects |
|
17 |
|
|
|
310 |
|
|
|
327 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Revenue excluding exchange rate effects |
|
9,491 |
|
|
|
2,830 |
|
|
|
12,321 |
|
|
|
7,557 |
|
|
|
1,756 |
|
|
|
9,313 |
|
Rental days (000's) |
|
121,917 |
|
|
|
43,100 |
|
|
|
165,017 |
|
|
|
99,763 |
|
|
|
34,931 |
|
|
|
134,694 |
|
RPD excluding exchange rate effects (in $'s) |
$ |
77.85 |
|
|
$ |
65.65 |
|
|
$ |
74.67 |
|
|
$ |
75.75 |
|
|
$ |
50.27 |
|
|
$ |
69.14 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization |
|
|
|
|
|
|
|
|
|
|
|
Rental days (000's) |
|
121,917 |
|
|
|
43,100 |
|
|
|
165,017 |
|
|
|
99,763 |
|
|
|
34,931 |
|
|
|
134,694 |
|
Average rental fleet |
|
479,672 |
|
|
|
174,708 |
|
|
|
654,380 |
|
|
|
385,610 |
|
|
|
143,300 |
|
|
|
528,910 |
|
Number of days in period |
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
|
365 |
|
Available rental days (000's) |
|
175,081 |
|
|
|
63,768 |
|
|
|
238,849 |
|
|
|
140,748 |
|
|
|
52,304 |
|
|
|
193,052 |
|
Vehicle utilization |
|
69.6 |
% |
|
|
67.6 |
% |
|
|
69.1 |
% |
|
|
70.9 |
% |
|
|
66.8 |
% |
|
|
69.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Per-Unit Fleet Costs |
|
|
|
|
|
|
|
|
|
|
|
Vehicle depreciation and lease charges, net |
$ |
413 |
|
|
$ |
415 |
|
|
$ |
828 |
|
|
$ |
851 |
|
|
$ |
346 |
|
|
$ |
1,197 |
|
Currency exchange rate effects |
|
4 |
|
|
|
49 |
|
|
|
53 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
$ |
417 |
|
|
$ |
464 |
|
|
$ |
881 |
|
|
$ |
851 |
|
|
$ |
346 |
|
|
$ |
1,197 |
|
Average rental fleet |
|
479,672 |
|
|
|
174,708 |
|
|
|
654,380 |
|
|
|
385,610 |
|
|
|
143,300 |
|
|
|
528,910 |
|
Per-unit fleet costs (in $'s) |
$ |
868 |
|
|
$ |
2,658 |
|
|
$ |
1,346 |
|
|
$ |
2,208 |
|
|
$ |
2,412 |
|
|
$ |
2,264 |
|
Number of months in period |
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
Per-unit fleet costs per month excluding exchange rate effects (in
$'s) |
$ |
72 |
|
|
$ |
221 |
|
|
$ |
112 |
|
|
$ |
184 |
|
|
$ |
201 |
|
|
$ |
189 |
|
_______ |
|
|
|
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 we define as income
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 and other legal matters, net, which
includes amounts recorded in excess of $5 million related to class
action lawsuits; non-operational charges related to shareholder
activist activity, which includes third party advisory, legal and
other professional fees; COVID-19 charges, net; other (income)
expense, net; and income taxes. Adjusted EBITDA includes
stock-based compensation expense and vehicle related deferred
financing fee amortization in the aggregate totaling $13 million
and $11 million in fourth quarter 2022 and 2021, respectively, and
$49 million and $52 million in the year ended December 31,
2022 and 2021, respectively.
We revised our definition of Adjusted EBITDA to
exclude other (income) expense, net. We did not revise prior years'
Adjusted EBITDA because there were no other charges similar in
nature. We believe Adjusted EBITDA is useful as a supplemental
measure in evaluating the performance of our operating businesses
and in comparing our results from period to period. We also believe
that Adjusted EBITDA is useful to investors because it allows them
to assess our results of operations and financial condition on the
same basis that management uses internally. Adjusted EBITDA is a
non-GAAP measure and should not be considered in isolation or as a
substitute for net income or other income statement data prepared
in accordance with GAAP. 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 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 our aggregate performance. 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, charges for unprecedented personal-injury
and other legal matters, COVID-19 charges, other (income) expense,
and non-operational charges related to shareholder activist
activity. 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.
Adjusted EBITDA
MarginRepresents Adjusted EBITDA as a percentage of
revenues.
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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