Avis Budget Group, Inc. (
NASDAQ: CAR) today
announced financial results for the fourth quarter and full year
ended December 31, 2023.
We ended 2023 with fourth quarter revenues of
$2.8 billion, driven by strong demand. Net income was $260 million
and Adjusted EBITDA1 was $311 million.
Full year revenues of $12.0 billion was a new
record for the Company. Net income was $1.6 billion and Adjusted
EBITDA was $2.5 billion, both second highest full year records for
the Company.
Our liquidity position at the end of the quarter
was over $800 million with approximately an additional
$900 million of fleet funding capacity. We have well-laddered
corporate debt and no meaningful maturities until 2026.
"We concluded the year with record revenue and
the second-best Adjusted EBITDA in our Company’s history. We
achieved this through continued demand improvement, seasonally
adjusted price well above historical levels, and reducing the costs
in our control,” said Joe Ferraro, Avis Budget Group Chief
Executive Officer. “We finished the year with the highest volume of
rentals in our fourth quarter history, and our employees seamlessly
provided exceptional service. I want to thank them for their
efforts, and we look forward to another successful year in
2024.”
Q4 and Full Year Highlights
- Total Company
revenues were $2.8 billion for the fourth quarter and $12.0 billion
for the year ended 2023, driven by strong demand. It is the best
full year revenue in the Company's history.
- Adjusted EBITDA in
the Americas was $309 million for the fourth quarter and $2.2
billion for the year ended 2023.
- Adjusted EBITDA in
International was $28 million for the fourth quarter and $400
million for the year ended 2023.
- We paid a one-time
special cash dividend of $10 per share to our shareholders in the
fourth quarter; the first time in our Company’s history.
- We repurchased
approximately 1.4 million shares of common stock in the fourth
quarter and 4.3 million shares of common stock for the year ended
2023 for a total of $257 million and $889 million, under the share
repurchase program, respectively.
- In November, we
issued $500 million Senior Notes due February 2031 and used the
proceeds to redeem all of our outstanding €250 million Senior Notes
due May 2025 and repay $200 million of our Term Loan C due March
2029.
INVESTOR CONFERENCE CALL
We will host a conference call to discuss our
fourth quarter results on February 13, 2024, at 8:30 a.m.
(ET). Investors may access the call on our investor relations
website at ir.avisbudgetgroup.com or by dialing (877) 407-2991. A
replay of the call will be available on our website and at (877)
660-6853 using conference code 13743503.
ABOUT AVIS BUDGET GROUP
We are a leading global provider of mobility
solutions, both through our Avis and Budget brands, which have
approximately 10,250 rental locations in approximately 180
countries around the world, and through our Zipcar brand, which is
the world's leading car sharing network. We operate most of our car
rental locations in North America, Europe and Australasia directly,
and operate primarily through licensees in other parts of the
world. We are headquartered in Parsippany, N.J. More information is
available at avisbudgetgroup.com.
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 are not considered generally accepted
accounting principle (“GAAP”) measures as defined under SEC rules.
Important information regarding such non-GAAP measures is contained
in the tables within this release and in Appendix I, including the
definitions of these measures and reconciliations to the most
comparable GAAP measures.
We measure performance principally using the
following key metrics: (i) rental days, (ii) revenue per day, (iii)
vehicle utilization, and (iv) per-unit fleet costs. Our rental
days, revenue per day and vehicle utilization metrics are all
calculated based on the actual rental of the vehicle during a
24-hour period. We believe that this methodology provides
management with the most relevant metrics in order to effectively
manage the performance of our business. Our calculations may not be
comparable to the calculations of similarly-titled metrics by other
companies. We present currency exchange rate effects on our key
metrics to provide a method of assessing how our business performed
excluding the effects of foreign currency rate fluctuations.
Currency exchange rate effects are calculated by translating the
current-period's results at the prior-period average exchange rates
plus any related gains and losses on currency hedges.
Forward-Looking Statements
Certain statements in this press release
constitute “forward-looking statements” as that term is defined in
the Private Securities Litigation Reform Act of 1995. The
forward-looking statements contained herein are subject to known
and unknown risks, uncertainties, assumptions and other factors
that may cause our actual results, performance or achievements to
be materially different from those expressed or implied by any such
forward-looking statements. Forward-looking statements include
information concerning our future financial performance, business
strategy, projected plans and objectives. These statements may be
identified by the fact that they do not relate to historical or
current facts and may use words such as “believes,” “expects,”
“anticipates,” “will,” “should,” “could,” “may,” “would,”
“intends,” “projects,” “estimates,” “plans,” “forecasts,”
“guidance,” and similar words, expressions or phrases. The
following important factors and assumptions could affect our future
results and could cause actual results to differ materially from
those expressed in such forward-looking statements. These factors
include, but are not limited to:
- the high level of competition in
the mobility industry, including from new companies or technology,
and the impact such competition may have on pricing and rental
volume;
- a change in our fleet costs,
including as a result of a change in the cost of new vehicles,
resulting from inflation or otherwise, manufacturer recalls,
disruption in the supply of new vehicles, including due to labor
actions by the United Auto Workers or otherwise, shortages in
semiconductors used in new vehicle production, and/or a change in
the price at which we dispose of used vehicles either in the used
vehicle market or under repurchase or guaranteed depreciation
programs;
- the results of operations or
financial condition of the manufacturers of our vehicles, which
could impact their ability to perform their payment obligations
under our agreements with them, including repurchase and/or
guaranteed depreciation arrangements, and/or their willingness or
ability to make vehicles available to us or the mobility industry
as a whole on commercially reasonable terms or at all;
- levels of and volatility in travel
demand, including future volatility in airline passenger
traffic;
- a deterioration in economic
conditions, resulting in a recession or otherwise, particularly
during our peak season or in key market segments;
- an occurrence or threat of
terrorism, the current and any future pandemic diseases, natural
disasters, military conflicts, including the ongoing military
conflicts in the Middle East and Eastern Europe, or civil unrest in
the locations in which we operate, and the potential effects of
sanctions on the world economy and markets and/or international
trade;
- any substantial changes in the cost
or supply of fuel, vehicle parts, energy, labor or other resources
on which we depend to operate our business, including as a result
of a global pandemic such as COVID-19, inflation, the ongoing
military conflicts in the Middle East and Eastern Europe, and any
embargoes on oil sales imposed on or by the Russian
government;
- our ability to continue to
successfully implement or achieve our business plans and
strategies, achieve and maintain cost savings and adapt our
business to changes in mobility;
- political, economic or commercial
instability in the countries in which we operate, and our ability
to conform to multiple and conflicting laws or regulations in those
countries;
- the performance of the used vehicle
market from time to time, including our ability to dispose of
vehicles in the used vehicle market on attractive terms;
- our dependence on third-party
distribution channels, third-party suppliers of other services and
co-marketing arrangements with third parties;
- risks related to completed or
future acquisitions or investments that we may pursue, including
the incurrence of incremental indebtedness to help fund such
transactions and our ability to promptly and effectively integrate
any acquired businesses or capitalize on joint ventures,
partnerships and other investments;
- our ability to utilize derivative
instruments, and the impact of derivative instruments we utilize,
which can be affected by fluctuations in interest rates, fuel
prices and exchange rates, changes in government regulations and
other factors;
- our exposure to uninsured or unpaid
claims in excess of historical levels and our ability to obtain
insurance at desired levels and the cost of that insurance;
- risks associated with litigation or
governmental or regulatory inquiries, or any failure or inability
to comply with laws, regulations or contractual obligations or any
changes in laws, regulations or contractual obligations, including
with respect to personally identifiable information and consumer
privacy, labor and employment, and tax;
- risks related to protecting the
integrity of, and preventing unauthorized access to, our
information technology systems or those of our third-party vendors,
licensees, dealers, independent operators and independent
contractors, and protecting the confidential information of our
employees and customers against security breaches, including
physical or cybersecurity breaches, attacks, or other disruptions,
compliance with privacy and data protection regulation, and the
effects of any potential increase in cyberattacks on the world
economy and markets and/or international trade;
- any impact on us from the actions
of our third-party vendors, licensees, dealers, independent
operators and independent contractors and/or disputes that may
arise out of our agreements with such parties;
- any major disruptions in our
communication networks or information systems;
- risks related to tax obligations
and the effect of future changes in tax laws and accounting
standards;
- risks related to our indebtedness,
including our substantial outstanding debt obligations, recent and
future interest rate increases, which increase our financing costs,
downgrades by rating agencies and our ability to incur
substantially more debt;
- our ability to obtain financing for
our global operations, including the funding of our vehicle fleet
through the issuance of asset-backed securities and use of the
global lending markets;
- our ability to meet the financial
and other covenants contained in the agreements governing our
indebtedness, or to obtain a waiver or amendment of such covenants
should we be unable to meet such covenants;
- significant changes in the
assumptions and estimates that are used in our impairment testing
for goodwill or intangible assets, which could result in a
significant impairment of our goodwill or intangible assets;
and
- other business, economic,
competitive, governmental, regulatory, political or technological
factors affecting our operations, pricing or services.
We operate in a continuously changing business
environment and new risk factors emerge from time to time. New risk
factors, factors beyond our control, or changes in the impact of
identified risk factors may cause actual results to differ
materially from those set forth in any forward-looking statements.
Accordingly, forward-looking statements should not be relied upon
as a prediction of actual results. Moreover, we do not assume
responsibility if future results are materially different from
those forecasted or anticipated. Other factors and assumptions not
identified above, including those discussed in “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” set forth in Item 2 and "Risk Factors" set forth in
Item 1A in our quarterly reports and in similarly titled sections
set forth in Item 7 and in Item 1A and in other portions of our
2022 Annual Report on Form 10-K filed with the Securities and
Exchange Commission (the “SEC”) on February 16, 2023 (the
“2022 Form 10-K”), may cause actual results to differ materially
from those projected in any forward-looking statements.
Although we believe that our assumptions are
reasonable, any or all of our forward-looking statements may prove
to be inaccurate and we can make no guarantees about our future
performance. Should unknown risks or uncertainties materialize or
underlying assumptions prove inaccurate, actual results could
differ materially from past results and/or those anticipated,
estimated or projected. We undertake no obligation to release any
revisions to any forward-looking statements, to report events or to
report the occurrence of unanticipated events. For any
forward-looking statements contained in any document, we claim the
protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995.
For additional information concerning forward-looking statements
and other important factors, refer to our 2022 Form 10-K, Quarterly
Reports on Form 10-Q and other filings with the SEC.
Investor Relations Contact: |
Media Relations Contact: |
David Calabria, IR@avisbudget.com |
James Tomlinson, ABGPress@edelman.com |
|
|
*** Tables 1 - 6 and Appendix I attached *** |
Table 1
Avis Budget Group,
Inc.SUMMARY DATA SHEET(In
millions, except per share data)
|
|
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
|
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
Income Statement and Other Items |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
$ |
2,764 |
|
|
$ |
2,771 |
|
|
— |
% |
|
$ |
12,008 |
|
$ |
11,994 |
|
— |
% |
|
Income before income taxes |
|
162 |
|
|
|
516 |
|
|
(69 |
)% |
|
|
1,914 |
|
|
3,636 |
|
(47 |
)% |
|
Net income |
|
260 |
|
|
|
424 |
|
|
(39 |
)% |
|
|
1,635 |
|
|
2,756 |
|
(41 |
)% |
|
Earnings per share - diluted |
|
7.10 |
|
|
|
10.10 |
|
|
(30 |
)% |
|
|
42.08 |
|
|
57.16 |
|
(26 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA(a) |
$ |
311 |
|
|
$ |
658 |
|
|
(53 |
)% |
|
$ |
2,490 |
|
$ |
4,133 |
|
(40 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, |
|
|
|
|
|
|
|
|
|
|
2023 |
|
2022 |
|
|
|
|
|
|
|
|
Balance Sheet Items |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
555 |
|
|
$ |
570 |
|
|
|
|
|
|
|
|
|
|
Program cash and restricted cash |
|
89 |
|
|
|
72 |
|
|
|
|
|
|
|
|
|
|
Vehicles, net |
|
21,240 |
|
|
|
15,961 |
|
|
|
|
|
|
|
|
|
|
Debt under vehicle programs |
|
18,937 |
|
|
|
13,809 |
|
|
|
|
|
|
|
|
|
|
Corporate debt |
|
4,823 |
|
|
|
4,671 |
|
|
|
|
|
|
|
|
|
|
Stockholders' equity attributable to Avis Budget Group, Inc. |
|
(349 |
) |
|
|
(703 |
) |
|
|
|
|
|
|
|
|
|
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
Segment Results |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
Americas |
$ |
2,167 |
|
|
$ |
2,204 |
|
|
(2 |
)% |
|
$ |
9,347 |
|
|
$ |
9,474 |
|
|
(1 |
)% |
International |
|
597 |
|
|
|
567 |
|
|
5 |
% |
|
|
2,661 |
|
|
|
2,520 |
|
|
6 |
% |
Corporate and Other |
|
— |
|
|
|
— |
|
|
n/m |
|
|
|
— |
|
|
|
— |
|
|
n/m |
|
Total Company |
$ |
2,764 |
|
|
$ |
2,771 |
|
|
— |
% |
|
$ |
12,008 |
|
|
$ |
11,994 |
|
|
— |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(a) |
|
|
|
|
|
|
|
|
|
|
|
Americas |
$ |
309 |
|
|
$ |
624 |
|
|
(50 |
)% |
|
$ |
2,196 |
|
|
$ |
3,660 |
|
|
(40 |
)% |
International |
|
28 |
|
|
|
63 |
|
|
(56 |
)% |
|
|
400 |
|
|
|
560 |
|
|
(29 |
)% |
Corporate and Other |
|
(26 |
) |
|
|
(29 |
) |
|
10 |
% |
|
|
(106 |
) |
|
|
(87 |
) |
|
(22 |
)% |
Total Company |
$ |
311 |
|
|
$ |
658 |
|
|
(53 |
)% |
|
$ |
2,490 |
|
|
$ |
4,133 |
|
|
(40 |
)% |
_______ |
n/m |
Not meaningful. |
(a) |
Refer to Table 5 for the reconciliation of net income to Adjusted
EBITDA and Appendix I for the related definition of the non-GAAP
financial measure. |
Table 2
Avis Budget Group,
Inc.CONSOLIDATED STATEMENTS OF
OPERATIONS(In millions, except per share
data)
|
|
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Revenues |
$ |
2,764 |
|
|
$ |
2,771 |
|
$ |
12,008 |
|
$ |
11,994 |
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
Operating |
|
1,350 |
|
|
|
1,325 |
|
|
5,675 |
|
|
5,285 |
|
|
Vehicle depreciation and lease charges, net |
|
582 |
|
|
|
349 |
|
|
1,739 |
|
|
828 |
|
|
Selling, general and administrative |
|
309 |
|
|
|
322 |
|
|
1,408 |
|
|
1,348 |
|
|
Vehicle interest, net |
|
223 |
|
|
|
121 |
|
|
736 |
|
|
402 |
|
|
Non-vehicle related depreciation and amortization |
|
53 |
|
|
|
57 |
|
|
216 |
|
|
225 |
|
|
Interest expense related to corporate debt, net: |
|
|
|
|
|
|
|
|
Interest expense |
|
75 |
|
|
|
69 |
|
|
296 |
|
|
250 |
|
|
Early extinguishment of debt |
|
4 |
|
|
|
— |
|
|
5 |
|
|
— |
|
|
Restructuring and other related charges |
|
4 |
|
|
|
3 |
|
|
11 |
|
|
19 |
|
|
Transaction-related costs, net |
|
2 |
|
|
|
7 |
|
|
5 |
|
|
8 |
|
|
Other (income) expense, net |
|
— |
|
|
|
2 |
|
|
3 |
|
|
(7 |
) |
Total expenses |
|
2,602 |
|
|
|
2,255 |
|
|
10,094 |
|
|
8,358 |
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
162 |
|
|
|
516 |
|
|
1,914 |
|
|
3,636 |
|
Provision for (benefit from) income taxes |
|
(98 |
) |
|
|
92 |
|
|
279 |
|
|
880 |
|
Net income |
|
260 |
|
|
|
424 |
|
|
1,635 |
|
|
2,756 |
|
Less: Net income (loss) attributable to non-controlling
interests |
|
1 |
|
|
|
1 |
|
|
3 |
|
|
(8 |
) |
Net income attributable to Avis Budget Group,
Inc. |
$ |
259 |
|
|
$ |
423 |
|
$ |
1,632 |
|
$ |
2,764 |
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
|
Basic |
$ |
7.18 |
|
|
$ |
10.32 |
|
$ |
42.57 |
|
$ |
58.41 |
|
|
Diluted |
$ |
7.10 |
|
|
$ |
10.10 |
|
$ |
42.08 |
|
$ |
57.16 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding |
|
|
|
|
|
|
|
|
Basic |
|
36.0 |
|
|
|
41.0 |
|
|
38.3 |
|
|
47.3 |
|
|
Diluted |
|
36.4 |
|
|
|
41.9 |
|
|
38.8 |
|
|
48.4 |
|
Table 3
Avis Budget Group,
Inc.KEY METRICS SUMMARY
|
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
|
31,009 |
|
|
|
29,226 |
|
|
6 |
% |
|
|
127,661 |
|
|
|
121,917 |
|
|
5 |
% |
Revenue per Day |
$ |
69.89 |
|
|
$ |
75.40 |
|
|
(7 |
)% |
|
$ |
73.22 |
|
|
$ |
77.71 |
|
|
(6 |
)% |
Revenue per Day, excluding exchange rate effects |
$ |
69.89 |
|
|
$ |
75.40 |
|
|
(7 |
)% |
|
$ |
73.35 |
|
|
$ |
77.71 |
|
|
(6 |
)% |
Average Rental Fleet |
|
518,928 |
|
|
|
467,331 |
|
|
11 |
% |
|
|
507,358 |
|
|
|
479,672 |
|
|
6 |
% |
Vehicle Utilization |
|
65.0 |
% |
|
|
68.0 |
% |
|
(3.0 |
)pps |
|
|
68.9 |
% |
|
|
69.6 |
% |
|
(0.7 |
)pps |
Per-Unit Fleet Costs per Month |
$ |
272 |
|
|
$ |
175 |
|
|
55 |
% |
|
$ |
200 |
|
|
$ |
72 |
|
|
178 |
% |
Per-Unit Fleet Costs per Month, excluding exchange rate
effects |
$ |
272 |
|
|
$ |
175 |
|
|
55 |
% |
|
$ |
200 |
|
|
$ |
72 |
|
|
178 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
|
11,018 |
|
|
|
10,680 |
|
|
3 |
% |
|
|
45,644 |
|
|
|
43,100 |
|
|
6 |
% |
Revenue per Day |
$ |
54.22 |
|
|
$ |
53.20 |
|
|
2 |
% |
|
$ |
58.30 |
|
|
$ |
58.48 |
|
|
— |
% |
Revenue per Day, excluding exchange rate effects |
$ |
52.39 |
|
|
$ |
53.20 |
|
|
(2 |
)% |
|
$ |
57.74 |
|
|
$ |
58.48 |
|
|
(1 |
)% |
Average Rental Fleet |
|
182,337 |
|
|
|
180,297 |
|
|
1 |
% |
|
|
184,147 |
|
|
|
174,708 |
|
|
5 |
% |
Vehicle Utilization |
|
65.7 |
% |
|
|
64.4 |
% |
|
1.3 |
pps |
|
|
67.9 |
% |
|
|
67.6 |
% |
|
0.3 |
pps |
Per-Unit Fleet Costs per Month |
$ |
291 |
|
|
$ |
192 |
|
|
52 |
% |
|
$ |
237 |
|
|
$ |
198 |
|
|
20 |
% |
Per-Unit Fleet Costs per Month, excluding exchange rate
effects |
$ |
278 |
|
|
$ |
192 |
|
|
45 |
% |
|
$ |
232 |
|
|
$ |
198 |
|
|
17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental Days (000’s) |
|
42,027 |
|
|
|
39,906 |
|
|
5 |
% |
|
|
173,305 |
|
|
|
165,017 |
|
|
5 |
% |
Revenue per Day |
$ |
65.78 |
|
|
$ |
69.46 |
|
|
(5 |
)% |
|
$ |
69.29 |
|
|
$ |
72.68 |
|
|
(5 |
)% |
Revenue per Day, excluding exchange rate effects |
$ |
65.30 |
|
|
$ |
69.46 |
|
|
(6 |
)% |
|
$ |
69.24 |
|
|
$ |
72.68 |
|
|
(5 |
)% |
Average Rental Fleet |
|
701,265 |
|
|
|
647,628 |
|
|
8 |
% |
|
|
691,505 |
|
|
|
654,380 |
|
|
6 |
% |
Vehicle Utilization |
|
65.1 |
% |
|
|
67.0 |
% |
|
(1.9 |
)pps |
|
|
68.7 |
% |
|
|
69.1 |
% |
|
(0.4 |
)pps |
Per-Unit Fleet Costs per Month |
$ |
277 |
|
|
$ |
180 |
|
|
54 |
% |
|
$ |
210 |
|
|
$ |
105 |
|
|
100 |
% |
Per-Unit Fleet Costs per Month, excluding exchange rate
effects |
$ |
274 |
|
|
$ |
180 |
|
|
52 |
% |
|
$ |
208 |
|
|
$ |
105 |
|
|
98 |
% |
_______ |
|
|
|
|
|
|
|
|
|
|
|
Refer to Table 6 for key metrics calculations and Appendix I for
key metrics definitions. |
Table 4
Avis Budget Group,
Inc.CONSOLIDATED CONDENSED SCHEDULE OF CASH FLOW
AND ADJUSTED FREE CASH FLOW(In
millions)
CONSOLIDATED CONDENSED SCHEDULE OF CASH FLOW |
Year Ended December 31, 2023 |
Operating Activities |
|
Net cash provided by operating activities |
$ |
3,828 |
|
Investing Activities |
|
Net cash used in investing activities exclusive of vehicle
programs |
|
(329 |
) |
Net cash used in investing activities of vehicle programs |
|
(7,017 |
) |
Net cash used in investing activities |
|
(7,346 |
) |
Financing Activities |
|
Net cash used in financing activities exclusive of vehicle
programs |
|
(1,210 |
) |
Net cash provided by financing activities of vehicle programs |
|
4,716 |
|
Net cash provided by financing activities |
|
3,506 |
|
Effect of changes in exchange rates on cash and cash equivalents,
program and restricted cash |
|
14 |
|
Net change in cash and cash equivalents, program and restricted
cash |
|
2 |
|
Cash and cash equivalents, program and restricted cash,
beginning of period |
|
642 |
|
Cash and cash equivalents, program and restricted cash, end
of period |
$ |
644 |
|
ADJUSTED FREE CASH
FLOW(a) |
Year Ended December 31, 2023 |
Adjusted
EBITDA(b) |
$ |
2,490 |
|
Interest expense related to corporate debt, net (excluding early
extinguishment of debt) |
|
(296 |
) |
Working capital and other |
|
(18 |
) |
Capital expenditures(c) |
|
(329 |
) |
Tax payments, net of refunds |
|
(169 |
) |
Vehicle programs and related(d) |
|
(451 |
) |
Adjusted Free Cash
Flow(b) |
$ |
1,227 |
|
Acquisition and related payments, net of acquired cash(e) |
|
(45 |
) |
Borrowings, net of debt repayments |
|
118 |
|
Repurchases of common stock |
|
(951 |
) |
Dividends paid |
|
(355 |
) |
Change in program and restricted cash |
|
16 |
|
Other receipts (payments), net |
|
(6 |
) |
Foreign exchange effects, financing costs and other |
|
(2 |
) |
Net change in cash and cash equivalents, program and
restricted cash (per above) |
$ |
2 |
|
_______ |
Refer to Appendix I for the definitions of non-GAAP financial
measures Adjusted EBITDA and Adjusted Free Cash Flow. |
(a) |
This presentation demonstrates the relationship between Adjusted
EBITDA and Adjusted Free Cash Flow. We believe it is useful to
understand this relationship because it demonstrates how cash
generated by our operations is used. This presentation is not
intended to be reconciliations of these non-GAAP measures, which
are provided on Table 5. |
(b) |
Refer to Table 5 for the reconciliations of net income to Adjusted
EBITDA and net cash provided by operating activities to Adjusted
Free Cash Flow. |
(c) |
Includes $56 million of cloud computing implementation costs. |
(d) |
Includes vehicle-backed borrowings (repayments) that are
incremental to amounts required to fund vehicle and vehicle-related
assets. |
(e) |
Excludes $20 million of vehicles purchased in licensee
acquisitions, which were financed through incremental
vehicle-backed borrowings. |
Table 5
Avis Budget Group,
Inc.RECONCILIATION OF NON-GAAP
MEASURES(In millions)
|
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
Reconciliation of Net income to Adjusted
EBITDA: |
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
|
|
|
|
|
|
Net income |
$ |
260 |
|
|
$ |
424 |
|
$ |
1,635 |
|
|
$ |
2,756 |
|
Provision for (benefit from) income taxes |
|
(98 |
) |
|
|
92 |
|
|
279 |
|
|
|
880 |
|
Income before income taxes |
|
162 |
|
|
|
516 |
|
|
1,914 |
|
|
|
3,636 |
|
Non-vehicle related depreciation and amortization |
|
53 |
|
|
|
57 |
|
|
216 |
|
|
|
225 |
|
Interest expense related to corporate debt, net |
|
|
|
|
|
|
|
Interest expense |
|
75 |
|
|
|
69 |
|
|
296 |
|
|
|
250 |
|
Early extinguishment of debt |
|
4 |
|
|
|
— |
|
|
5 |
|
|
|
— |
|
Restructuring and other related charges |
|
4 |
|
|
|
3 |
|
|
11 |
|
|
|
19 |
|
Transaction-related costs, net |
|
2 |
|
|
|
7 |
|
|
5 |
|
|
|
8 |
|
Other (income) expense, net |
|
— |
|
|
|
2 |
|
|
3 |
|
|
|
(7 |
) |
Reported within operating expenses: |
|
|
|
|
|
|
|
Cloud computing costs |
|
11 |
|
|
|
4 |
|
|
35 |
|
|
|
10 |
|
COVID-19 charges, net |
|
— |
|
|
|
— |
|
|
— |
|
|
|
(9 |
) |
Legal matters, net |
|
— |
|
|
|
— |
|
|
5 |
|
|
|
1 |
|
Adjusted EBITDA |
$ |
311 |
|
|
$ |
658 |
|
$ |
2,490 |
|
|
$ |
4,133 |
|
|
|
|
|
|
|
|
|
Reconciliation of Net cash provided by operating activities
to Adjusted Free Cash Flow: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
|
|
$ |
3,828 |
|
|
|
Net cash used in investing activities of vehicle programs |
|
|
|
|
|
(7,017 |
) |
|
|
Net cash provided by financing activities of vehicle programs |
|
|
|
|
|
4,716 |
|
|
|
Capital expenditures |
|
|
|
|
|
(273 |
) |
|
|
Proceeds received on sale of assets and nonmarketable equity
securities |
|
|
|
|
|
3 |
|
|
|
Acquisition and disposition-related payments |
|
|
|
|
|
(20 |
) |
|
|
Change in program and restricted cash |
|
|
|
|
|
(16 |
) |
|
|
Other receipts (payments), net |
|
|
|
|
|
6 |
|
|
|
Adjusted Free Cash Flow |
|
|
|
|
$ |
1,227 |
|
|
|
_______ |
|
|
|
|
|
|
|
Refer to Appendix I for the definitions of Adjusted EBITDA and
Adjusted Free Cash Flow, non-GAAP financial measures. Adjusted
EBITDA includes stock-based compensation expense and vehicle
related deferred financing fee amortization in the aggregate
totaling $15 million and $13 million in the three months ended
December 31, 2023 and 2022, respectively, and $59 million and
$49 million in the years ended ended December 31, 2023 and
2022, respectively. |
Table 6
Avis Budget Group,
Inc.KEY METRICS CALCULATIONS($ in
millions, except as noted)
|
|
Three Months Ended December 31, 2023 |
|
Three Months Ended December 31, 2022 |
|
|
Americas |
|
International |
|
Total |
|
Americas |
|
International |
|
Total |
Revenue per Day (RPD) |
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
2,167 |
|
|
$ |
597 |
|
|
$ |
2,764 |
|
|
$ |
2,204 |
|
|
$ |
567 |
|
|
$ |
2,771 |
|
|
Currency exchange rate effects |
|
— |
|
|
|
(20 |
) |
|
|
(20 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Revenue excluding exchange
rate effects |
|
2,167 |
|
|
|
577 |
|
|
|
2,744 |
|
|
|
2,204 |
|
|
|
567 |
|
|
|
2,771 |
|
|
Rental days (000's) |
|
31,009 |
|
|
|
11,018 |
|
|
|
42,027 |
|
|
|
29,226 |
|
|
|
10,680 |
|
|
|
39,906 |
|
|
RPD excluding exchange rate effects (in $'s) |
$ |
69.89 |
|
|
$ |
52.39 |
|
|
$ |
65.30 |
|
|
$ |
75.40 |
|
|
$ |
53.20 |
|
|
$ |
69.46 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization |
|
|
|
|
|
|
|
|
|
|
|
|
Rental days (000's) |
|
31,009 |
|
|
|
11,018 |
|
|
|
42,027 |
|
|
|
29,226 |
|
|
|
10,680 |
|
|
|
39,906 |
|
|
Average rental fleet |
|
518,928 |
|
|
|
182,337 |
|
|
|
701,265 |
|
|
|
467,331 |
|
|
|
180,297 |
|
|
|
647,628 |
|
|
Number of days in period |
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
|
92 |
|
|
Available rental days (000's) |
|
47,741 |
|
|
|
16,775 |
|
|
|
64,516 |
|
|
|
42,995 |
|
|
|
16,587 |
|
|
|
59,582 |
|
|
Vehicle utilization |
|
65.0 |
% |
|
|
65.7 |
% |
|
|
65.1 |
% |
|
|
68.0 |
% |
|
|
64.4 |
% |
|
|
67.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Per-Unit Fleet Costs |
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle depreciation and lease
charges, net |
$ |
424 |
|
|
$ |
158 |
|
|
$ |
582 |
|
|
$ |
245 |
|
|
$ |
104 |
|
|
$ |
349 |
|
|
Currency exchange rate effects |
|
— |
|
|
|
(7 |
) |
|
|
(7 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
$ |
424 |
|
|
$ |
151 |
|
|
$ |
575 |
|
|
$ |
245 |
|
|
$ |
104 |
|
|
$ |
349 |
|
|
Average rental fleet |
|
518,928 |
|
|
|
182,337 |
|
|
|
701,265 |
|
|
|
467,331 |
|
|
|
180,297 |
|
|
|
647,628 |
|
|
Per-unit fleet costs (in $'s) |
$ |
816 |
|
|
$ |
834 |
|
|
$ |
821 |
|
|
$ |
525 |
|
|
$ |
576 |
|
|
$ |
539 |
|
|
Number of months in period |
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
|
3 |
|
|
Per-unit fleet costs per month
excluding exchange rate effects (in $'s) |
$ |
272 |
|
|
$ |
278 |
|
|
$ |
274 |
|
|
$ |
175 |
|
|
$ |
192 |
|
|
$ |
180 |
|
|
|
Year Ended December 31, 2023 |
|
Year Ended December 31, 2022 |
|
|
Americas |
|
International |
|
Total |
|
Americas |
|
International |
|
Total |
Revenue per Day (RPD) |
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
9,347 |
|
|
$ |
2,661 |
|
|
$ |
12,008 |
|
|
$ |
9,474 |
|
|
$ |
2,520 |
|
|
$ |
11,994 |
|
|
Currency exchange rate effects |
|
17 |
|
|
|
(25 |
) |
|
|
(8 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Revenue excluding exchange rate
effects |
|
9,364 |
|
|
|
2,636 |
|
|
|
12,000 |
|
|
|
9,474 |
|
|
|
2,520 |
|
|
|
11,994 |
|
|
Rental days (000's) |
|
127,661 |
|
|
|
45,644 |
|
|
|
173,305 |
|
|
|
121,917 |
|
|
|
43,100 |
|
|
|
165,017 |
|
|
RPD excluding exchange rate
effects (in $'s) |
$ |
73.35 |
|
|
$ |
57.74 |
|
|
$ |
69.24 |
|
|
$ |
77.71 |
|
|
$ |
58.48 |
|
|
$ |
72.68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle Utilization |
|
|
|
|
|
|
|
|
|
|
|
|
Rental days (000's) |
|
127,661 |
|
|
|
45,644 |
|
|
|
173,305 |
|
|
|
121,917 |
|
|
|
43,100 |
|
|
|
165,017 |
|
|
Average rental fleet |
|
507,358 |
|
|
|
184,147 |
|
|
|
691,505 |
|
|
|
479,672 |
|
|
|
174,708 |
|
|
|
654,380 |
|
|
Number of days in period |
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
|
365 |
|
|
Available rental days (000's) |
|
185,186 |
|
|
|
67,213 |
|
|
|
252,399 |
|
|
|
175,081 |
|
|
|
63,768 |
|
|
|
238,849 |
|
|
Vehicle utilization |
|
68.9 |
% |
|
|
67.9 |
% |
|
|
68.7 |
% |
|
|
69.6 |
% |
|
|
67.6 |
% |
|
|
69.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Per-Unit Fleet Costs |
|
|
|
|
|
|
|
|
|
|
|
|
Vehicle depreciation and lease
charges, net |
$ |
1,215 |
|
|
$ |
524 |
|
|
$ |
1,739 |
|
|
$ |
413 |
|
|
$ |
415 |
|
|
$ |
828 |
|
|
Currency exchange rate effects |
|
1 |
|
|
|
(12 |
) |
|
|
(11 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
$ |
1,216 |
|
|
$ |
512 |
|
|
$ |
1,728 |
|
|
$ |
413 |
|
|
$ |
415 |
|
|
$ |
828 |
|
|
Average rental fleet |
|
507,358 |
|
|
|
184,147 |
|
|
|
691,505 |
|
|
|
479,672 |
|
|
|
174,708 |
|
|
|
654,380 |
|
|
Per-unit fleet costs (in $'s) |
$ |
2,397 |
|
|
$ |
2,780 |
|
|
$ |
2,499 |
|
|
$ |
863 |
|
|
$ |
2,373 |
|
|
$ |
1,266 |
|
|
Number of months in period |
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
|
12 |
|
|
Per-unit fleet costs per month
excluding exchange rate effects (in $'s) |
$ |
200 |
|
|
$ |
232 |
|
|
$ |
208 |
|
|
$ |
72 |
|
|
$ |
198 |
|
|
$ |
105 |
|
_______ |
|
|
|
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-period's 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 is a non-GAAP measure
most directly comparable to net income (loss). Adjusted EBITDA is
defined as 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 legal matters, net,
which includes amounts recorded in excess of $5 million
related to class action lawsuits and personal injury matters;
non-operational charges related to shareholder activist activity,
which includes third-party advisory, legal and other professional
fees; COVID-19 charges, net; cloud computing costs; other (income)
expense, net, and income taxes.
We believe Adjusted EBITDA is useful to
investors 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 U.S. 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 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 legal matters, net, which
includes amounts recorded in excess of $5 million related to class
action lawsuits and personal injury 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 from net cash provided by operating activities recognized
under GAAP is provided on Table 5.
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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