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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
 
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2024
OR
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from              to
Commission file number: 001-31262  
ASBURY AUTOMOTIVE GROUP, INC.
(Exact name of Registrant as specified in its charter)
Delaware01-0609375
(State or other jurisdiction of
incorporation or organization)		(I.R.S. Employer
Identification No.)
2905 Premiere Parkway NW,Suite 300 
Duluth, Georgia
30097
(Address of principal executive offices) (Zip Code)
(770) 418-8200
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Trading
Title of each classSymbol(s)Name of each exchange on which registered
Common stock, $0.01 par value per shareABGNew York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x    No  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:
Large Accelerated Filer☒  Accelerated Filer☐
Non-Accelerated Filer☐Smaller Reporting Company☐
Emerging Growth Company☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  x
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: The number of shares of common stock outstanding as of August 7, 2024 was 19,980,100.

ASBURY AUTOMOTIVE GROUP, INC.

TABLE OF CONTENTS

  Page
PART I—Financial Information
PART II—Other Information







PART I. FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements

ASBURY AUTOMOTIVE GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except par value and share data)
(Unaudited)
 June 30, 2024December 31, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents$67.2 $45.7 
Short-term investments10.5 6.2 
Contracts-in-transit, net210.2 279.7 
Accounts receivable, net235.2 226.1 
Inventories, net2,066.0 1,768.3 
Assets held for sale206.6 342.2 
Other current assets422.5 388.9 
Total current assets3,218.3 3,057.1 
INVESTMENTS337.6 326.7 
PROPERTY AND EQUIPMENT, net2,423.4 2,315.7 
OPERATING LEASE RIGHT-OF-USE ASSETS228.6 241.8 
GOODWILL2,010.4 2,009.0 
INTANGIBLE FRANCHISE RIGHTS1,957.1 2,095.8 
OTHER LONG-TERM ASSETS130.7 113.3 
Total assets$10,306.0 $10,159.4 
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Floor plan notes payable—trade, net$102.8 $195.1 
Floor plan notes payable—non-trade, net1,317.3 1,590.6 
Current maturities of long-term debt113.1 84.9 
Current maturities of operating leases26.9 26.2 
Accounts payable and accrued liabilities769.7 748.1 
Deferred revenue—current233.6 228.6 
Liabilities associated with assets held for sale2.0 2.1 
Total current liabilities2,565.5 2,875.7 
LONG-TERM DEBT3,488.2 3,121.2 
LONG-TERM LEASE LIABILITY209.3 222.1 
DEFERRED REVENUE525.8 508.1 
DEFERRED INCOME TAXES137.7 136.4 
OTHER LONG-TERM LIABILITIES48.8 51.7 
COMMITMENTS AND CONTINGENCIES (Note 14)
SHAREHOLDERS' EQUITY:
Preferred stock, $.01 par value; 10,000,000 shares authorized; none issued
or outstanding
— — 
Common stock, $.01 par value; 90,000,000 shares authorized; 42,044,298 and 42,352,001 shares issued, including shares held in treasury, respectively
0.4 0.4 
Additional paid-in capital1,299.5 1,288.4 
Retained earnings3,048.7 2,961.5 
Treasury stock, at cost; 22,064,198 and 22,018,537 shares, respectively
(1,082.5)(1,067.3)
Accumulated other comprehensive income64.7 61.1 
Total shareholders' equity3,330.7 3,244.1 
Total liabilities and shareholders' equity$10,306.0 $10,159.4 

See accompanying Notes to Condensed Consolidated Financial Statements
4
ASBURY AUTOMOTIVE GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share data)
(Unaudited)
 For the Three Months Ended June 30,For the Six Months Ended June 30,
 2024202320242023
REVENUE:
New vehicle$2,164.9 $1,942.7 $4,229.1 $3,710.4 
Used vehicle1,308.0 1,107.3 2,664.9 2,233.9 
Parts and service580.9 526.1 1,171.2 1,041.7 
Finance and insurance, net192.4 166.3 382.1 338.9 
TOTAL REVENUE4,246.2 3,742.5 8,447.4 7,324.8 
COST OF SALES:
New vehicle2,009.8 1,757.7 3,911.2 3,346.5 
Used vehicle1,247.0 1,036.4 2,532.0 2,086.0 
Parts and service241.0 234.1 497.2 467.6 
Finance and insurance17.7 1.2 26.3 15.5 
TOTAL COST OF SALES3,515.5 3,029.4 6,966.7 5,915.5 
GROSS PROFIT730.7 713.1 1,480.7 1,409.3 
OPERATING EXPENSES:
Selling, general, and administrative476.5 408.6 945.1 811.6 
Depreciation and amortization18.2 16.8 36.9 33.5 
Asset impairments135.4 — 135.4 — 
INCOME FROM OPERATIONS100.5 287.7 363.3 564.2 
OTHER EXPENSES (INCOME):
Floor plan interest expense21.0 0.8 43.8 1.5 
Other interest expense, net45.1 39.3 89.2 76.6 
Gain on dealership divestitures(3.6)(13.5)(3.6)(13.5)
Total other expenses, net62.5 26.6 129.4 64.6 
INCOME BEFORE INCOME TAXES38.0 261.1 233.9 499.6 
Income tax expense9.9 64.8 58.7 121.9 
NET INCOME$28.1 $196.4 $175.2 $377.7 
EARNINGS PER SHARE:
Basic—
Net income$1.40 $9.37 $8.66 $17.78 
Diluted—
Net income$1.39 $9.34 $8.64 $17.70 
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic20.120.920.221.2
Restricted stock0.1———
Performance share units—0.10.10.1
Diluted20.221.020.321.3





 
See accompanying Notes to Condensed Consolidated Financial Statements
5
ASBURY AUTOMOTIVE GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In millions)
(Unaudited)
 For the Three Months Ended June 30,For the Six Months Ended June 30,
 202420232024 2023
Net income$28.1 $196.4 $175.2 $377.7 
Other comprehensive income:
Change in fair value of cash flow swaps(0.6)17.0 9.4 (2.4)
Income tax benefit (expense) associated with cash flow swaps0.1 (4.1)(2.3)0.6 
Unrealized losses on available-for-sale debt securities(1.6)(4.2)(4.3)(1.7)
Income tax benefit associated with available-for-sale debt securities0.3 1.0 0.9 0.5 
Comprehensive income$26.4  $206.0 $178.8  $374.7 







































See accompanying Notes to Condensed Consolidated Financial Statements
6
ASBURY AUTOMOTIVE GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(Dollars in millions)
(Unaudited)


 Common StockAdditional
Paid-in
Capital		Retained
Earnings		Treasury StockAccumulated
Other
Comprehensive
Income (Loss)		Total
 SharesAmountSharesAmount
Balances, December 31, 202342,352,001 $0.4 $1,288.4 $2,961.5 22,018,537 $(1,067.3)$61.1 $3,244.1 
Comprehensive Income:
Net income— — — 147.1 — — — 147.1 
Change in fair value of cash flow swaps, net of reclassification adjustment and $2.5 million tax expense
— — — — — — 7.5 7.5 
Unrealized loss on changes in fair value of debt securities, net of reclassification adjustment and $0.6 million tax benefit
— — — — — — (2.2)(2.2)
Comprehensive income— — — 147.1 — — 5.3 152.4 
Share-based compensation— — 10.5 — — — — 10.5 
Issuance of common stock, net of forfeitures, in connection with share-based payment arrangements123,845 — — — — — — — 
Share repurchases— — — — 239,790 (50.4)— (50.4)
Repurchase of common stock associated with net share settlement of employee share-based awards— — — — 45,399 (9.8)— (9.8)
Retirement of common stock(239,790)— (2.9)(47.1)(239,790)50.0 — — 
Balances, March 31, 202442,236,056 $0.4 $1,296.1 $3,061.5 22,063,936 $(1,077.5)$66.4 $3,346.9 
Comprehensive Income:
Net income— — — 28.1 — — — 28.1 
Change in fair value of cash flow swaps, net of reclassification adjustment and $0.1 million tax benefit
— — — — — — (0.4)(0.4)
Unrealized loss on changes in fair value of debt securities, net of reclassification adjustment and $0.3 million tax benefit
— — — — — — (1.3)(1.3)
Comprehensive income— — — 28.1 — — (1.7)26.4 
Share-based compensation— — 5.7 — — — — 5.7 
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements841 — — — — — 
Share repurchases— — — — 192,599 (48.2)— (48.2)
Repurchase of common stock associated with net share settlement of employee share-based awards— — — — 262 (0.1)— (0.1)
Retirement of common stock(192,599)— (2.3)(40.9)(192,599)43.2 — — 
Balances, June 30, 202442,044,298 $0.4 $1,299.5 $3,048.7 22,064,198 $(1,082.5)$64.7 $3,330.7 



7
 Common StockAdditional
Paid-in
Capital		Retained
Earnings		Treasury StockAccumulated
Other
Comprehensive
Income (Loss)		Total
 SharesAmountSharesAmount
Balances, December 31, 202243,593,809 $0.4 $1,281.4 $2,610.1 22,024,479 $(1,063.0)$74.4 $2,903.5 
Comprehensive Income:
Net income— — — 181.4 — — — 181.4 
Change in fair value of cash flow swaps, net of reclassification adjustment and $4.7 million tax benefit
— — — — — — (14.6)(14.6)
Unrealized gain on changes in fair value of debt securities, net of reclassification adjustment and $0.5 million tax expense
— — — — — — 2.0 2.0 
Comprehensive income— — — 181.4 — — (12.6)168.7 
Share-based compensation— — 8.6 — — — — 8.6 
Issuance of common stock, net of forfeitures, in connection with share-based payment arrangements120,575 — — — — — — — 
Share repurchases— — — — 110,323 (20.7)— (20.7)
Repurchase of common stock associated with net share settlement of employee share-based awards— — — — 45,613 (10.9)— (10.9)
Retirement of common stock(164,527)— (2.0)(28.2)(164,527)30.2 — — 
Balances, March 31, 202343,549,857 $0.4 $1,288.0 $2,763.3 22,015,888 $(1,064.3)$61.8 $3,049.2 
Comprehensive Income:
Net income— — — 196.4 — — — 196.4 
Change in fair value of cash flow swaps, net of reclassification adjustment and $4.1 million tax expense
— — — — — — 12.8 12.8 
Unrealized loss on changes in fair value of debt securities, net of reclassification adjustment and $1.0 million tax benefit
— — — — — — (3.2)(3.2)
Comprehensive income— — — 196.4 — — 9.6 206.0 
Share-based compensation— — 5.5 — — — — 5.5 
Issuance of common stock, net of forfeitures in connection with share-based payment arrangements1,043 — — — — — — — 
Share repurchases— — — — 959,803 (192.1)— (192.1)
Repurchase of common stock associated with net share settlement of employee share-based awards— — — — 379 (0.1)— (0.1)
Retirement of common stock(959,803)— (11.6)(178.5)(959,803)190.1 — — 
Balances, June 30, 202342,591,097 $0.4 $1,282.0 $2,781.1 22,016,267 $(1,066.4)$71.4 $3,068.6 



















See accompanying Notes to Condensed Consolidated Financial Statements
8
ASBURY AUTOMOTIVE GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
 For the Six Months Ended June 30,
 20242023
CASH FLOW FROM OPERATING ACTIVITIES:
Net income$175.2 $377.7 
Adjustments to reconcile net income to net cash provided by operating activities—
Depreciation and amortization36.9 33.5 
Share-based compensation16.2 14.1 
Deferred income taxes(0.1)2.2 
Asset impairments135.4 — 
Gains on investments(0.3)(3.3)
Loaner vehicle amortization23.9 13.4 
Gain on divestitures(3.6)(13.5)
Change in right-of-use assets14.3 12.4 
Other adjustments, net6.1 1.5 
Changes in operating assets and liabilities, net of acquisitions and divestitures—
Contracts-in-transit69.5 53.6 
Accounts receivable, net(9.5)(3.3)
Inventories(307.0)(242.6)
Other current assets, net(54.2)(69.1)
Floor plan notes payable—trade, net(92.3)(1.7)
Deferred revenue22.7 0.2 
Accounts payable and accrued liabilities14.3 64.1 
Operating lease liabilities(13.3)(12.9)
Other long-term assets and liabilities, net(11.4)(4.6)
Net cash provided by operating activities22.7 221.7 
CASH FLOW FROM INVESTING ACTIVITIES:
Capital expenditures—excluding real estate(65.4)(40.8)
Capital expenditures—real estate(67.4)— 
Purchase of previously leased real estate(11.9)— 
Acquisitions(4.7)— 
Proceeds from dealership divestitures149.3 30.7 
Purchases of debt securities—available-for-sale(39.4)(124.2)
Proceeds from the sale of debt securities—available-for-sale21.5 17.7 
Proceeds from the sale of equity securities— 51.8 
Proceeds from the sale of assets— 2.3 
Net cash used in investing activities(18.0)(62.5)
CASH FLOW FROM FINANCING ACTIVITIES:
Floor plan borrowings—non-trade4,834.1 3,719.2 
Floor plan repayments—non-trade(5,081.3)(3,722.0)
Floor plan repayments—non-trade—divestitures(26.1)— 
Repayments of borrowings(37.6)(82.8)
Proceeds from revolving credit facility1,013.5 — 
Repayments of revolving credit facility(582.8)— 
Purchases of treasury stock(93.2)(220.3)
Repurchases of common stock, associated with net share settlements of
employee share-based awards		(9.9)(11.0)
Net cash provided by (used in) financing activities16.7 (316.9)
Net increase (decrease) in cash and cash equivalents21.5 (157.8)
CASH AND CASH EQUIVALENTS, beginning of period45.7 235.3 
CASH AND CASH EQUIVALENTS, end of period$67.2 $77.5 

See Note 12 "Supplemental Cash Flow Information" for further details
See accompanying Notes to Condensed Consolidated Financial Statements
9
ASBURY AUTOMOTIVE GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Asbury Automotive Group, Inc., a Delaware corporation organized in 2002, is one of the largest automotive retailers in the United States. Our store operations are conducted by our subsidiaries.
As of June 30, 2024, we owned and operated 204 new vehicle franchises (155 dealership locations), representing 31 brands of automobiles, and 37 collision centers in 15 states. For the six months ended June 30, 2024, our new vehicle revenue brand mix consisted of 29% luxury, 41% imports and 29% domestic brands. Our stores offer an extensive range of automotive products and services, including new and used vehicles; parts and service, which includes repair and maintenance services, replacement parts and collision repair services (collectively referred to as "parts and services" or "P&S"); and finance and insurance ("F&I") products, including arranging vehicle financing through third parties and aftermarket products, such as extended service contracts, guaranteed asset protection ("GAP") debt cancellation and prepaid maintenance. The finance and insurance products are provided by independent third parties and Total Care Auto, Powered by Landcar ("TCA"). The Company reflects its operations in two reportable segments: Dealerships and TCA.
Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and reflect the consolidated accounts of Asbury Automotive Group, Inc. (the "Company") and our wholly owned subsidiaries. All intercompany transactions have been eliminated in consolidation. If necessary, reclassifications of amounts previously reported have been made to the accompanying condensed consolidated financial statements in order to conform to current presentation.
In the opinion of management, all adjustments, consisting only of normal, recurring adjustments, considered necessary for a fair statement of the condensed consolidated financial statements as of June 30, 2024, and for the three and six months ended June 30, 2024 and 2023, have been included, unless otherwise indicated. Amounts presented in the condensed consolidated financial statements have been calculated using non-rounded amounts for all periods presented and therefore certain amounts may not compute.
The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for any other interim period, or any full year period. Our condensed consolidated financial statements should be read together with our audited consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2023.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the periods presented. Actual results could differ materially from these estimates. Estimates and assumptions are reviewed quarterly and the effects of any revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Estimates made in the accompanying condensed consolidated financial statements include, but are not limited to, those relating to inventory valuation reserves, reserves for chargebacks against revenue recognized from the sale of F&I products, reserves for self-insurance programs, and certain assumptions related to goodwill and dealership franchise rights intangible assets.
Share Repurchases
Share repurchases may be made from time-to-time in open market transactions or through privately negotiated transactions under the authorization approved by the Board of Directors. Periodically, the Company may retire repurchased shares of common stock previously held by the Company as treasury stock. In accordance with our accounting policy, we allocate any excess share repurchase price over par value between additional paid-in capital, which is limited to amounts initially recorded for the same issue, and retained earnings.
During the three months ended June 30, 2024 and 2023, the Company repurchased 192,599 and 959,803 shares and retired 192,599 and 959,803 shares, of our common stock under our share repurchase program, respectively. During the six months ended June 30, 2024 and 2023, the Company repurchased 432,389 and 1,070,126 shares and retired 432,389 and 1,124,330, shares, of our common stock under our share repurchase program, respectively. The cash paid for these share repurchases was $93.2 million and $210.7 million for the six months ended June 30, 2024 and 2023, respectively.
10
On May 15, 2024, the Company announced that its Board of Directors approved an increase of $256.2 million in the Company's common share repurchase authorization to $400.0 million (the "New Share Repurchase Authorization"). As of June 30, 2024, the Company had $365.6 million remaining on its share repurchase authorization. The share repurchase authorization does not require the Company to repurchase any specific number of shares, and may be modified, suspended or terminated at any time without further notice.
Earnings per Share
Basic earnings per share is computed by dividing net income by the weighted-average common shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted-average common shares and common share equivalents outstanding during the period. The Company excluded 145 and 714 restricted share units issued under the Asbury Automotive Group, Inc. 2019 Equity and Incentive Compensation Plan from its computation of diluted earnings per share for the three months ended June 30, 2024 and 2023, respectively. The Company did not exclude any performance share units issued under the Asbury Automotive Group, Inc. 2019 Equity and Incentive Compensation Plan from its computation of diluted earnings per share for the three months ended June 30, 2024 and 2023. During the six months ended June 30, 2024 and 2023, the Company excluded 2,865 and 3,947 restricted share units and 23 and 0 performance share units issued under the Asbury Automotive Group, Inc. 2019 Equity and Incentive Compensation Plan from its computation of diluted earnings per share, respectively, because they were anti-dilutive. For all periods presented, there were no adjustments to the numerator necessary to compute diluted earnings per share.
Recent Accounting Pronouncements
The Financial Accounting Standards Board ("FASB") issued final guidance in ASU 2023-09, Improvements to Income Tax Disclosures, in December 2023 which primarily expands the disclosures related to the effective tax rate reconciliation and income taxes paid. The guidance is effective for annual periods beginning after December 15, 2024 and should be applied prospectively with the option of retrospective application. We are evaluating the impact of this new guidance on our consolidated financial statements.
In November 2023, the FASB issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which enhances the disclosures primarily around segment expenses. In addition, the amendments expand the scope of quarterly financial reporting by requiring disclosure of both existing annual segment reporting disclosures and the expanded disclosures outlined in ASU 2023-07. The guidance should be applied retrospectively and is effective for fiscal years beginning after December 15, 2023, and for interim periods beginning after December 15, 2024. We are evaluating the impact of this new guidance on our consolidated financial statements.
11
2. REVENUE RECOGNITION
Disaggregation of Revenue
Revenue from contracts with customers for the three and six months ended June 30, 2024 and 2023 consists of the following:
For the Three Months Ended June 30,
20242023
(In millions)
Revenue:
   New vehicle$2,164.9 $1,942.7 
   Used vehicle retail1,167.2 1,013.3 
   Used vehicle wholesale140.9 94.0 
New and used vehicle3,472.9 3,050.0 
  Sale of vehicle parts and accessories125.2 123.9 
  Vehicle repair and maintenance services455.6 402.2 
Parts and services580.9 526.1 
  Finance and insurance, net192.4 166.3 
Total revenue$4,246.2 $3,742.5 
For the Six Months Ended June 30,
20242023
(In millions)
Revenue:
   New vehicle$4,229.1 $3,710.4 
   Used vehicle retail2,358.5 2,034.9 
   Used vehicle wholesale306.4 198.9 
New and used vehicle6,894.1 5,944.2 
  Sale of vehicle parts and accessories258.9 250.0 
  Vehicle repair and maintenance services912.3 791.7 
Parts and service1,171.2 1,041.7 
Finance and insurance, net382.1 338.9 
Total revenue$8,447.4 $7,324.8 
Contract Assets
Changes in contract assets during the period are reflected in the table below. Contract assets related to vehicle repair and maintenance services are transferred to receivables when a repair order is completed and invoiced to the customer. Certain incremental sales commissions payable to obtain an F&I revenue contract with a customer have been capitalized and are amortized using the same pattern of recognition applicable to the associated F&I revenue contract.
12
Vehicle Repair and Maintenance ServicesFinance and Insurance, netDeferred Sales CommissionsTotal
(In millions)
Balance as of January 1, 2024$20.5 $13.8 $68.4 $102.7 
Transferred to receivables from contract assets recognized at the beginning of the period(20.5)(2.2)— (22.7)
Amortization of costs to obtain a contract with a customer— — (4.1)(4.1)
Costs incurred to obtain a contract with a customer— — 10.6 10.6 
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period18.9 1.9 — 20.8 
Balance as of March 31, 2024$18.9 $13.5 $74.9 $107.3 
Contract Assets (current), March 31, 202418.9 13.5 20.2 52.6 
Contract Assets (long-term), March 31, 2024— — 54.7 54.7 
Transferred to receivables from contract assets recognized at the beginning of the period(18.9)(2.6)— (21.5)
Amortization of costs to obtain a contract with a customer— — (4.6)(4.6)
Costs incurred to obtain a contract with a customer— — 10.4 10.4 
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period19.7 2.4 — 22.1 
Balance as of June 30, 2024$19.7 $13.3 $80.7 $113.7 
Contract Assets (current), June 30, 202419.7 13.3 21.7 54.7 
Contract Assets (long-term), June 30, 2024— — 59.0 59.0 
Deferred Revenue
The condensed consolidated balance sheets reflect $759.4 million and $736.7 million of deferred revenue as of June 30, 2024 and December 31, 2023, respectively. Approximately $128.8 million of deferred revenue at December 31, 2023 was recorded in finance and insurance, net revenue in the condensed consolidated statements of income during the six months ended June 30, 2024.
3. ACQUISITIONS AND DIVESTITURES
Koons Acquisition
On December 11, 2023, we completed the acquisition of the Jim Koons Dealerships ("Koons"). The results of the Jim Koons Dealerships have been included in our consolidated financial statements since that date.
As a result of the Koons acquisition, we acquired 20 new vehicle dealerships, six collision centers and the real property related thereto, for a total purchase price of approximately $1.50 billion, which includes $256.1 million of new vehicle floor plan financing and $100.9 million of assets held for sale related to Koons Lexus of Wilmington. The preliminary purchase price was paid in cash.
13
The sources of the preliminary purchase consideration are as follows:
(In millions)
Cash$941.3 
New vehicle floor plan facility256.1 
Used vehicle floor plan facility307.1 
Preliminary purchase price$1,504.5 
Under the acquisition method of accounting, the tangible and intangible assets acquired and liabilities assumed are recorded at their estimated fair value based on information currently available. The following table summarizes the amounts recorded based on preliminary estimates of fair value:
Summary of Assets Acquired and Liabilities Assumed
(In millions)
Assets
Inventories, net$310.6 
Other current assets13.7 
Assets held for sale100.9 
Total current assets425.2 
Property and equipment, net418.3 
Goodwill238.9 
Intangible franchise rights430.3 
Operating lease right-of-use assets11.2 
Total assets acquired$1,523.9 
Liabilities
Operating lease liabilities$11.2 
Other liabilities8.2 
Total liabilities assumed19.4 
Net assets acquired$1,504.5 
The preliminary acquisition accounting is based upon the Company’s estimates of fair value. The estimated fair values of the assets acquired and liabilities assumed and the related preliminary acquisition accounting are based on management’s estimates and assumptions, as well as other information compiled by management, including the books and records of Koons. Our estimates and assumptions are subject to change during the measurement period, not to exceed one year from the acquisition date. The areas of acquisition accounting that are not yet finalized primarily relate to the following significant items: (i) finalizing the review and valuation of inventory, land, land improvements, buildings and non-real property and equipment (including the models, key assumptions, estimates and inputs used) and assignment of remaining useful lives associated with the depreciable assets, and (ii) finalizing the review and valuation of manufacturer franchise rights (including key assumptions, inputs and estimates). As the initial acquisition accounting is based on our preliminary assessments, actual values may differ (possibly materially) when final information becomes available that differs from our current estimates. We believe that the information gathered to date provides a reasonable basis for estimating the preliminary fair values of assets acquired and liabilities assumed. We will continue to evaluate these items until they are satisfactorily resolved and adjust our acquisition accounting accordingly, within the allowable measurement period. Measurement period adjustments recorded during the six months ended June 30, 2024 and their related effects on our consolidated statement of income were not material.
On a preliminary basis, approximately $430.3 million of the purchase price was assigned to the indefinite lived franchise rights intangible assets related to the dealer agreements applicable to each new vehicle dealership. In addition, goodwill of $238.9 million was recognized and is primarily attributable to the anticipated synergies that Asbury expects to derive from the Koons acquisition as well as the acquired assembled workforce of the Koons dealerships.
The Company's consolidated statement of income for the six months ended June 30, 2024 included revenue and net income attributable to the Jim Koons Dealerships of $1,406.7 million and $49.2 million, respectively.

14
Other Acquisitions and Divestitures
There were no acquisitions during the six months ended June 30, 2024 and 2023.
During the six months ended June 30, 2024, we sold one Lexus franchise (one dealership location) in Wilmington, Delaware due to OEM requirements in connection with the Koons acquisition, one Nissan franchise (one dealership location) in Denver, Colorado and one Nissan franchise (one dealership location) in Atlanta, Georgia. The Company recorded a pre-tax gain totaling $3.6 million, which is presented in our accompanying condensed consolidated statement of income as a gain on dealership divestitures.
During the six months ended June 30, 2023, we sold one Acura franchise (one dealership location) in Austin, Texas. The Company recorded a pre-tax gain totaling $13.5 million, which is presented in our accompanying condensed consolidated statement of income as a gain on dealership divestitures.
4. ACCOUNTS RECEIVABLE
Accounts receivable consisted of the following: 
 As of
 June 30, 2024December 31, 2023
 (In millions)
Vehicle receivables$87.3 $72.5 
Manufacturer receivables60.6 68.0 
Other receivables90.3 88.1 
     Total accounts receivable238.2 228.6 
Less—Allowance for credit losses(3.0)(2.6)
     Accounts receivable, net$235.2 $226.1 
5. INVENTORIES
Inventories consisted of the following:
As of
 June 30, 2024December 31, 2023
 (In millions)
New vehicles$1,540.2 $1,252.5 
Used vehicles378.0 373.1 
Parts and accessories147.8 142.7 
Total inventories, net (a)$2,066.0 $1,768.3 
___________________________
(a) Inventories, net as of June 30, 2024 and December 31, 2023, excluded $58.4 million and $84.5 million classified as assets held for sale, respectively.
The lower of cost and net realizable value reserves reduced total inventories by $8.3 million and $8.8 million as of June 30, 2024 and December 31, 2023, respectively. As of June 30, 2024 and December 31, 2023, certain automobile manufacturer incentives reduced new vehicle inventory cost by $10.6 million and $8.3 million, respectively, and reduced new vehicle cost of sales for the six months ended June 30, 2024 and 2023 by $53.3 million and $46.4 million, respectively.
6. ASSETS AND LIABILITIES HELD FOR SALE
Assets and liabilities classified as held for sale include (i) assets and liabilities associated with pending dealership disposals and (ii) real estate not currently used in our operations that we are actively marketing to sell.
15
A summary of assets held for sale and liabilities associated with assets held for sale is as follows:
As of
June 30, 2024December 31, 2023
(In millions)
Assets:
Inventory$58.4 $84.5 
Loaners, net1.1 4.5 
Property and equipment, net110.8 136.6 
Operating lease right-of-use assets2.0 2.1 
Goodwill3.7 26.1 
Franchise rights30.5 88.5 
Total assets held for sale206.6 342.2 
Liabilities:
Current maturities of operating leases0.2 0.2 
Operating lease liabilities1.8 1.9 
Total liabilities associated with assets held for sale2.0 2.1 
Net assets held for sale$204.5 $340.1 
As of June 30, 2024, assets held for sale consisted of 8 franchises (8 dealership locations) in addition to one real estate property not currently used in our operations.
As of December 31, 2023, assets held for sale consisted of 11 franchises (11 dealership locations) in addition to one real estate property not currently used in our operations.
7. INVESTMENTS
Our investment portfolio is primarily funded by product premiums from the sale of our TCA F&I products. The amortized cost, gross unrealized gains and losses and estimated fair values of debt securities available-for-sale are as follows:
As of June 30, 2024
Amortized CostGross Unrealized GainsGross Unrealized LossesFair Value
(In millions)
Short-term investments$10.6 $— $(0.1)$10.5 
U.S. Treasury17.1 — (0.3)16.9 
Municipal29.5 — (0.5)29.1 
Corporate149.2 0.6 (1.8)148.0 
Mortgage and other asset-backed securities144.6 0.7 (1.6)143.7 
Total investments$351.1 $1.3 $(4.3)$348.1 

16
As of December 31, 2023
Amortized CostGross Unrealized GainsGross Unrealized LossesFair Value
(In millions)
Short-term investments$6.3 $— $(0.1)$6.2 
U.S. Treasury13.6 0.1 (0.1)13.5 
Municipal30.1 0.2 (0.2)30.1 
Corporate131.5 1.6 (0.9)132.2 
Mortgage and other asset-backed securities150.1 1.6 (0.9)150.9 
Total investments$331.6 $3.5 $(2.2)$332.9 
As of June 30, 2024 and December 31, 2023, the Company had $2.7 million and $2.5 million of accrued interest receivable, respectively, which is included in other current assets on the condensed consolidated balance sheets. The Company does not consider accrued interest receivable in the carrying amount of financial assets held at amortized cost basis or in the allowance for credit losses.
A summary of amortized costs and fair value of investments by time to maturity, is as follows:
 As of June 30, 2024
 Amortized CostFair Value
 (In millions)
Due in 1 year or less$10.6 $10.5 
Due in 1-5 years122.9 121.6 
Due in 6-10 years72.9 72.3 
Total by maturity206.5 204.4 
Mortgage and other asset-backed securities144.6 143.7 
Total investment securities$351.1 $348.1 
There were no gross losses and $0.2 million gross gains realized related to the sale of available-for-sale debt securities carried at fair value for the three months ended June 30, 2024. There were no gross losses and $0.3 million gross gains realized related to the sale of available-for-sale debt securities carried at fair value for the six months ended June 30, 2024.
There were $0.1 million and $0.2 million gross gains realized, respectively, related to the sale of available-for-sale debt securities carried at fair value for the three and six months ended June 30, 2023. There were no gross losses realized related to the sale of available-for-sale debt securities carried at fair value for the three and six months ended June 30, 2023. There were $3.7 million gross gains and $0.9 million gross losses realized, respectively, related to the sale of equity securities carried at fair value for the three and six months ended June 30, 2023.
The following tables summarize the amount of unrealized losses, defined as the amount by which the amortized cost exceeds fair value, and the related fair value of investments with unrealized losses. The investments were segregated into two categories: those that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position for 12 or more months. The reference point for determining how long an investment was in an unrealized loss position was June 30, 2024.
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As of June 30, 2024
Less than 12 MonthsGreater than 12 MonthsTotal
Fair ValueUnrealized LossesFair ValueUnrealized LossesFair ValueUnrealized Losses
(In millions)
Short-term investments$— $— $8.1 $(0.1)$8.1 $(0.1)
U.S. Treasury4.0 — 8.2 (0.2)12.2 (0.3)
Municipal2.3 — 22.5 (0.5)24.8 (0.5)
Corporate22.7 (0.2)81.9 (1.6)104.6 (1.8)
Mortgage and other asset-backed securities22.0 (0.3)59.5 (1.3)81.6 (1.6)
Total debt securities$51.0 $(0.5)$180.3 $(3.8)$231.3 $(4.3)
As of December 31, 2023
Less than 12 MonthsGreater than 12 MonthsTotal
Fair ValueUnrealized LossesFair ValueUnrealized LossesFair ValueUnrealized Losses
(In millions)
Short-term investments$— $— $6.0 $(0.1)$6.0 $(0.1)
U.S. Treasury3.4 (0.1)5.0 (0.1)8.5 (0.1)
Municipal6.4 (0.1)10.4 (0.1)16.8 (0.2)
Corporate11.4 (0.1)48.0 (0.8)59.4 (0.9)
Mortgage and other asset-backed securities29.8 (0.4)33.1 (0.5)62.9 (0.9)
Total debt securities$51.1 $(0.7)$102.5 $(1.6)$153.6 $(2.2)
The Company reviews the investment securities portfolio at the security level on a quarterly basis for potential credit losses, which takes into consideration numerous factors including changes in credit ratings. The decline in fair value identified in the tables above are a result of widening market spreads and not a result of credit quality. Additionally, the Company has determined it has both the intent and ability to hold these investments until the market price recovers or until maturity and does not believe it will be required to sell the securities before maturity. Accordingly, no credit losses were recognized on these securities during the three and six months ended June 30, 2024.
8. GOODWILL AND INTANGIBLE FRANCHISE RIGHTS
Our acquisitions have resulted in the recording of goodwill and intangible franchise rights. Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Franchise rights are indefinite-lived intangible assets representing our rights under franchise agreements with vehicle manufacturers. Goodwill and intangible franchise rights are tested annually as of October 1st, or more frequently in the event that facts and circumstances indicate a triggering event has occurred.
Based on the underperformance of certain stores, limited primarily to one brand, we performed quantitative impairment tests of franchise rights for certain stores in our Dealerships segment in the second quarter of 2024. The quantitative impairment tests for franchise rights included a comparison of the estimated fair value to the carrying value of each franchise right asset. The Company estimates fair value by using a discounted cash flow model (income approach) based on market participant assumptions related to the cash flows directly attributable to the franchise. These assumptions include year-over-year and terminal growth rates, weighted average cost of capital, future gross margins, and future selling, general, and administrative expenses.
The results of the quantitative impairment testing for certain franchise rights in the second quarter of 2024 identified that the carrying values of certain of our franchise rights intangible assets exceeded their fair value. As a result, we recognized a $134.1 million pre-tax non-cash impairment charge during the three months ended June 30, 2024.
The stores with franchise rights impairments in the second quarter of 2024 primarily related to our Arizona and Utah reporting units within our Dealerships segment. Therefore, we performed quantitative impairment assessments of goodwill for
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these two reporting units in the second quarter of 2024. The results of our quantitative assessments indicated that the carrying value of goodwill related to the Arizona and Utah reporting units did not exceed their fair value.
We also recorded a goodwill impairment charge of $1.3 million during the three months ended June 30, 2024 related to one dealership that met the assets held for sale criteria in June 2024. The quantitative impairment test of the disposal group included a comparison of the estimated fair value to the carrying value of the disposal group less cost to sell.
9. FLOOR PLAN NOTES PAYABLE
Floor plan notes payable consisted of the following:
As of
 June 30, 2024December 31, 2023
 (In millions)
Floor plan notes payable—trade$301.5 $245.6 
Floor plan notes payable offset account(198.7)(50.5)
Floor plan notes payable—trade, net$102.8 $195.1 
Floor plan notes payable—new non-trade$1,530.0 $1,328.1 
Floor plan notes payable—used non-trade— 307.1 
Floor plan notes payable offset account(212.7)(44.7)
Floor plan notes payable—non-trade, net$1,317.3 $1,590.6 
We have floor plan offset accounts that allow us to offset our floor plan notes payable balances outstanding with transfers of cash to reduce the amount of outstanding floor plan notes payable that would otherwise accrue interest, while retaining the ability to transfer amounts from the offset account into our operating cash accounts within the same day.
We have the ability to convert a portion of our availability under the Revolving Credit Facility to the New Vehicle Floor Plan Facility or the Used Vehicle Floor Plan Facility. The maximum amount we are allowed to convert is determined based on our aggregate revolving commitment under the Revolving Credit Facility, less $50.0 million. In addition, we are able to convert any amounts moved to the New Vehicle Floor Plan Facility or Used Vehicle Floor Plan Facility back to the Revolving Credit Facility.
In addition to our new and used vehicle floor plan facilities, we have loaner vehicle floor plan facilities with Bank of America and certain original equipment manufacturers (“OEMs”). Loaner vehicles notes payable related to Bank of America as of June 30, 2024 and December 31, 2023 were $132.3 million and $127.2 million, respectively. Loaner vehicles notes payable related to OEMs as of June 30, 2024 and December 31, 2023 were $103.9 million and $111.9 million, respectively.
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10. DEBT
Long-term debt consisted of the following:
 As of
June 30, 2024December 31, 2023
(In millions)
4.50% Senior Notes due 2028
$405.0