Lithia & Driveway (LAD) Reports Highest Second Quarter Earnings In Company History; Increases Revenue 118% And EPS 218%

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Announces Dividend Of $0.35 Per Share For Second Quarter

MEDFORD, Ore., July 21, 2021 /PRNewswire/ -- Lithia & Driveway (NYSE: LAD) today reported the highest second quarter revenue and earnings per share in company history.

Lithia & Driveway (PRNewsfoto/Lithia Motors, Inc.)
Lithia & Driveway (PRNewsfoto/Lithia Motors, Inc.)

Second quarter 2021 revenue increased 118% to $6.0 billion from $2.8 billion in the second quarter of 2020.

Second quarter 2021 net income per diluted share was $10.75, a 218% increase from $3.38 per diluted share reported in the second quarter of 2020. Adjusted second quarter 2021 net income per diluted share was $11.12, an 199% increase compared to adjusted net income of $3.72 per diluted share in the same period of 2020.

Second quarter 2021 net income was $305 million, a 292% increase compared to net income of $78 million in the same period of 2020. Adjusted second quarter 2021 net income was $315 million, a 269% increase compared to adjusted net income of $86 million for the same period of 2020.

As shown in the attached non-GAAP reconciliation tables, the 2021 second quarter adjusted results exclude a $0.37 per diluted share net non-core charge related to acquisition expenses, net loss on sale of stores, and insurance reserves, partially offset by a a non-cash unrealized investment gain. The 2020 second quarter adjusted results exclude a $0.34 per diluted share net non-core charge due to asset impairment, insurance reserves, and acquisition expenses, partially offset by a net gain on sale of stores and a tax attribute.

Second Quarter-over-Quarter Comparisons and Operating Highlights:

  • Total company revenues increased 117.8%

  • New vehicle retail sales increased 130.0%

  • Used vehicle retail sales increased 95.7%

  • Driveway milestone reached of 500 transactions in June

  • F&I per unit increased 16.4% to $1,854

  • Service, body, and parts revenues increased 89.1%

  • Total vehicle gross profit per unit increased 41.3% to $5,723

  • Adjusted SG&A as a percentage of gross profit improved by 900 basis points from 64.7% to 55.7%

"Our team's high performance, alongside the robust, demand-driven retail environment in the second quarter, resulted in same store revenue growth of 20% for new vehicles, 49% for used vehicles, 39% for F&I and 3% for service, body and parts compared to 2019," said Bryan DeBoer, Lithia & Driveway, President and CEO. "We achieved our initial Driveway monthly volume milestone in the final month of the quarter and are on pace to reach our target of 15,000 Driveway transactions this year. Combined with our outpaced growth in our core business and network development, we are considerably ahead of our year one goals laid out in our 5-Year Plan announced in July 2020."

For the first six months of 2021 revenues increased 86% to $10.4 billion, compared to $5.6 billion in 2020.

Net income for the first six months of 2021 was $16.69 per diluted share, compared to $5.32 per diluted share in 2020, an increase of 214%. Adjusted net income per diluted share for the first six months of 2021 increased 201% to $17.15 from $5.70 in the same period of 2020.

Corporate Development
During the quarter, we completed numerous acquisitions that in total are expected to contribute $3.7 billion in annualized revenue. These acquisitions strategically added density in key geographic markets and increased our nationwide footprint.

"With 40% of our targeted $20 billion revenue acquired in the first year of our 5-Year Plan, we are well ahead of schedule and are only getting started," said DeBoer. "Our acquisition pipeline is more active than we have ever seen and we are well positioned to continue to aggressively pursue our goal of achieving $50 billion in revenue and $50 of earnings per share."

Balance Sheet Update
We ended the second quarter with approximately $2.6 billion in cash and availability on our revolving lines of credit. In addition, our unfinanced real estate could provide additional liquidity of approximately $655 million.

Dividend Payment
Our Board of Directors approved a dividend of $0.35 per share related to second quarter 2021 financial results. We expect to pay the dividend on August 27, 2021 to shareholders of record on August 13, 2021.

Second Quarter Earnings Conference Call and Updated Presentation
The second quarter 2021 conference call may be accessed at 10:00 a.m. ET today by telephone at 877-407-8029. An updated presentation highlighting the second quarter 2021 results has been added to our investor relations website. To listen live on our website or for replay, visit www.lithiainvestorrelations.com and click on webcasts.

About Lithia & Driveway (LAD)
LAD is a growth company powered by people and innovation with a 5-Year Plan to profitably consolidate the largest retail sector in the country. As the leading provider of personal transportation solutions in the United States, LAD is among the fastest-growing companies in the Fortune 500 (#2 on 10-Year EPS Growth, #3 on 10-Year TSR and #12 on 10-year Revenue growth in 2021). By providing a wide array of products and services for the entire vehicle ownership lifecycle through various consumer channels, they build magnetic brand loyalty. Operational excellence is achieved by focusing the business on convenient and transparent consumer experiences supported by proprietary data science to increase market share, consumer loyalty and profitability. LAD's omni-channel strategy will continue to pragmatically disrupt the industry by leveraging experienced teams, vast owned inventories, technology, and physical network. Continuing to lead the industry's consolidation and Driveway's e-commerce in-home experiences further accelerates the massive regenerating capital engine. Together, these endeavors create a unique and compelling high-growth strategy that provides transportation solutions wherever, whenever, and however consumers desire.

Sites
www.lithia.com
www.lithiainvestorrelations.com
www.lithiacareers.com
www.driveway.com

Lithia & Driveway on Facebook
https://www.facebook.com/LithiaMotors
https://www.facebook.com/DrivewayHQ

Lithia & Driveway on Twitter
https://twitter.com/lithiamotors
https://twitter.com/DrivewayHQ

Forward-Looking Statements
Certain statements in this presentation, and at times made by our officers and representatives, constitute forward-looking statements within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Generally, you can identify forward-looking statements by terms such as "project", "outlook", "target", "may", "will", "would", "should", "seek", "expect", "plan", "intend", "forecast", "anticipate", "believe", "estimate", "predict", "potential", "likely", "goal", "strategy", "future", "maintain", and "continue" or the negative of these terms or other comparable terms. Examples of forward-looking statements in this presentation include, among others, statements regarding:

  • Future market conditions, including anticipated car sales levels;

  • Anticipated impacts of the continued COVID-19 pandemic on the U.S. and local economies in which we operate, our business operations and consumer demand;

  • Continuation of our sales and services, including in-store appointments and home deliveries;

  • Expected growth from our e-commerce home solutions and digital strategies;

  • Expected operating results, such as improved store performance; continued improvement of selling, general and administrative expenses ("SG&A") as a percentage of gross profit and all projections;

  • Anticipated integration, success and growth of acquired stores;

  • Anticipated ability to capture additional market share;

  • Anticipated ability to find accretive acquisitions;

  • Expected revenues from acquired stores;

  • Anticipated synergies, ability to monetize our investment in digital innovation;

  • Anticipated additions of dealership locations to our portfolio in the future;

  • Anticipated financial condition and liquidity, including from our cash, availability on our credit facility and unfinanced real estate;

  • Anticipated use of proceeds from our financings;

  • Anticipated allocations, uses and levels of capital expenditures in the future;

  • Expectations regarding compliance with financial and restrictive covenants in our credit facility and other debt agreements;

  • Statements regarding furloughed employees and cost reductions;

  • Expectations regarding programs and initiatives for employee recruitment, training, and retention; and

  • Our strategies for customer retention, growth, market position, financial results and risk management.

Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this presentation. Therefore, you should not rely on any of these forward-looking statements. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation:

  • Future economic and financial conditions (both nationally and locally), including as a result of the COVID-19 pandemic;

  • Changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers and other suppliers;

  • Risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms);

  • The adequacy of our cash flow and earnings and other conditions which may affect our ability to pay our quarterly dividend at the planned level;

  • Disruptions to our technology network including computer systems and software, as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of our operating systems, structures, facilities or equipment; and

  • Government regulations and legislation, and other risks set forth throughout "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and in "Part I, Item 1A. Risk Factors" of our most recent Annual Report on Form 10-K, and in "Part II, Item 1A. Risk Factors" of our Quarterly Reports on Form 10-Q, and from time to time in our other filings with the SEC.

Any forward-looking statement made by us in this presentation is based only on information currently available to us and speaks only as of the date on which it is made. Except as required by law, we undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Non-GAAP Financial Measures
This presentation contains non-GAAP financial measures such as adjusted net income and diluted earnings per share, adjusted SG&A as a percentage of revenue and gross profit, adjusted operating margin, adjusted operating profit as a percentage of revenue and gross profit, adjusted pre-tax margin and net profit margin, EBITDA, adjusted EBITDA, leveraged EBITDA and adjusted total debt. Non-GAAP measures do not have definitions under GAAP and may be defined differently by and not comparable to similarly titled measures used by other companies. As a result, we review any non-GAAP financial measures in connection with a review of the most directly comparable measures calculated in accordance with GAAP. We caution you not to place undue reliance on such non-GAAP measures, but also to consider them with the most directly comparable GAAP measures. We present cash flows from operations in the attached tables, adjusted to include the change in non-trade floor plan debt to improve the visibility of cash flows related to vehicle financing. As required by SEC rules, we have reconciled these measures to the most directly comparable GAAP measures in the attachments to this release. We believe the non-GAAP financial measures we present improve the transparency of our disclosures; provide a meaningful presentation of our results from core business operations, because they exclude items not related to core business operations and other non-cash items; and improve the period-to-period comparability of our results from core business operations. These presentations should not be considered an alternative to GAAP measures.

Lithia Motors, Inc.

Consolidated Statements of Operations (Unaudited)

(In millions except per share data)




Three months ended June 30,


%


Six months ended June 30,


%




Increase



Increase



2021


2020


(Decrease)


2021


2020


(Decrease)

Revenues:













New vehicle retail


$

3,146.2



$

1,367.8



130.0

%


$

5,339.5



$

2,741.3



94.8

%

Used vehicle retail


1,804.9



922.2



95.7



3,157.0



1,796.5



75.7


Used vehicle wholesale


217.4



51.3



323.8



352.6



118.0



198.8


Finance and insurance


269.6



124.9



115.9



467.9



246.7



89.7


Service, body and parts


521.0



275.5



89.1



925.0



605.4



52.8


Fleet and other


50.3



16.9



197.6



110.4



54.4



102.9


Total revenues


6,009.4



2,758.6



117.8

%


10,352.4



5,562.3



86.1

%

Cost of sales:













New vehicle retail


2,832.5



1,275.6



122.1



4,869.0



2,570.9



89.4


Used vehicle retail


1,572.3



823.9



90.8



2,788.3



1,608.3



73.4


Used vehicle wholesale


201.0



49.2



308.5



331.6



115.3



187.6


Service, body and parts


242.9



131.1



85.3



428.6



292.8



46.4


Fleet and other


50.1



14.4



247.9



108.8



49.7



118.9


Total cost of sales


4,898.8



2,294.2



113.5



8,526.3



4,637.0



83.9


Gross profit


1,110.6



464.4



139.1

%


1,826.1



925.3



97.4

%

Asset impairments




7.9



NM




7.9



NM


SG&A expense


634.0



304.5



108.2



1,084.2



650.5



66.7


Depreciation and amortization


30.3



22.3



35.9



57.2



44.3



29.1


Income from operations


446.3



129.7



244.1

%


684.7



222.6



207.6

%

Floor plan interest expense


(6.4)



(8.1)



(21.0)



(13.3)



(22.1)



(39.8)


Other interest expense


(28.1)



(16.8)



67.3



(51.6)



(33.8)



52.7


Other income, net


7.6



3.5



NM


11.1



5.8



NM


Income before income taxes


419.4



108.3



287.3

%


630.9



172.5



265.7

%

Income tax expense


(114.5)



(30.6)



274.2



(169.8)



(48.6)



249.4


Income tax rate


27.3

%


28.3

%




26.9

%


28.2

%



Net income


$

304.9



$

77.7



292.4

%


$

461.1



$

123.9



272.2

%














Diluted net income per share:













Net income per share


$

10.75



$

3.38



218.0

%


$

16.69



$

5.32



213.7

%














Diluted shares outstanding


28.4


23.0


23.5

%


27.6


23.3


18.5

%

NM - not meaningful

Lithia Motors, Inc.

Key Performance Metrics (Unaudited)




Three months ended June 30,


%


Six months ended June 30,


%




Increase



Increase



2021


2020


(Decrease)


2021


2020


(Decrease)

Gross margin













New vehicle retail


10.0

%


6.7

%


330

bps


8.8

%


6.2

%


260

bps

Used vehicle retail


12.9



10.7



220



11.7



10.5



120


Finance and insurance


100.0



100.0





100.0



100.0




Service, body and parts


53.4



52.4



100



53.7



51.6



210


Gross profit margin


18.5



16.8



170



17.6



16.6



100















Unit sales













New vehicle retail


75,176



34,869



115.6

%


129,040



70,776



82.3

%

Used vehicle retail


70,254



43,505



61.5



129,281



86,136



50.1


Total retail units sold


145,430



78,374



85.6



258,321



156,912



64.6















Average selling price













New vehicle retail


$

41,852



$

39,226



6.7

%


$

41,379



$

38,732



6.8

%

Used vehicle retail


25,691



21,196



21.2



24,420



20,857



17.1















Average gross profit per unit













New vehicle retail


$

4,173



$

2,643



57.9

%


$

3,646



$

2,407



51.5

%

Used vehicle retail


3,311



2,259



46.6



2,852



2,185



30.5


Finance and insurance


1,854



1,593



16.4



1,811



1,572



15.2


Total vehicle(1)


5,723



4,050



41.3



5,141



3,875



...

32.7















Revenue mix













New vehicle retail


52.4

%


49.6

%




51.6

%


49.3

%



Used vehicle retail


30.0



33.4





30.5



32.3




Used vehicle wholesale


3.6



1.9





3.4



2.1




Finance and insurance, net


4.5



4.5





4.5



4.4




Service, body and parts


8.7



10.0





8.9



10.9




Fleet and other


0.8



0.6





1.1



1.0

















Gross Profit Mix













New vehicle retail


28.2

%


19.8

%




25.8

%


18.4

%



Used vehicle retail


20.9



21.2





20.2



20.3




Used vehicle wholesale


1.5



0.5





1.2



0.3




Finance and insurance, net


24.3



26.9





25.6



26.7




Service, body and parts


25.1



31.0





27.1



33.8




Fleet and other




0.6





0.1



0.5






Adjusted


As reported


Adjusted


As reported



Three months ended
June 30,


Three months ended
June 30,


Six months ended
June 30,


Six months ended
June 30,

Other metrics


2021


2020


2021


2020


2021


2020


2021


2020

SG&A as a % of revenue


10.3

%


10.9

%


10.5

%


11.0

%


10.3

%


11.6

%


10.5

%


11.7

%

SG&A as a % of gross profit


55.7



64.7



57.1



65.6



58.4



69.7



59.4



70.3


Operating profit as a % of revenue


7.7



5.1



7.4



4.7



6.8



4.2



6.6



4.0


Operating profit as a % of gross profit


41.6



30.5



40.2



27.9



38.5



25.5



37.5



24.1


Pretax margin


7.2



4.4



7.0



3.9



6.3



3.3



6.1



3.1


Net profit margin


5.2



3.1



5.1



2.8



4.6



2.4



4.5



2.2


(1)

Includes the sales and gross profit related to new, used retail, used wholesale and finance and insurance and unit sales for new and used retail

Lithia Motors, Inc.

Same Store Operating Highlights (Unaudited)




Three months ended
June 30,


%


Six months ended
June 30,


%




Increase



Increase



2021


2020


(Decrease)


2021


2020


(Decrease)

Revenues













New vehicle retail


$

2,078.1



$

1,338.8



55.2

%


$

3,801.6



$

2,671.9



42.3

%

Used vehicle retail


1,342.7



902.1



48.8



2,462.2



1,751.5



40.6


Finance and insurance


183.6



122.4



50.0



337.2



241.2



39.8


Service, body and parts


352.3



269.9



30.5



668.3



589.1



13.4


Total revenues


4,128.1



2,700.2



52.9



7,596.7



5,421.9



40.1















Gross profit













New vehicle retail


$

209.8



$

90.2



132.6

%


$

336.5



$

166.4



102.2

%

Used vehicle retail


180.4



97.1



85.8



300.2



185.5



61.8


Finance and insurance


183.6



122.4



50.0



337.2



241.2



39.8


Service, body and parts


193.3



141.5



36.6



362.2



304.3



19.0


Total gross profit


777.1



455.8



70.5



1,350.8



904.9



49.3















Gross margin













New vehicle retail


10.1

%


6.7

%


340

bps


8.9

%


6.2

%


270

bps

Used vehicle retail


13.4



10.8



260



12.2



10.6



160


Finance and insurance


100.0



100.0





100.0



100.0




Service, body and parts


54.9



52.4



250



54.2



51.7



250


Gross profit margin


18.8



16.9



190



17.8



16.7



110















Unit sales













New vehicle retail


49,181



34,069



44.4

%


91,592



68,870



33.0

%

Used vehicle retail


51,806



42,495



21.9



101,075



83,823



20.6















Average selling price













New vehicle retail


$

42,255



$

39,296



7.5

%


$

41,506



$

38,797



7.0

%

Used vehicle retail


25,918



21,228



22.1



24,360



20,895



16.6















Average gross profit per unit













New vehicle retail


$

4,266



$

2,646



61.2

%


$

3,674



$

2,416



52.1

%

Used vehicle retail


3,483



2,285



52.4



2,970



2,212



34.3


Finance and insurance


1,818



1,599



13.7



1,750



1,579



10.8


Total vehicle(1)


5,778



4,072



41.9



5,121



3,903



31.2


(1)

Includes the sales and gross profit related to new, used retail, used wholesale and finance and insurance and unit sales for new and used retail

Lithia Motors, Inc.

Other Highlights (Unaudited)



As of


June 30,


December 31,


June 30,


2021


2020


2020

Days Supply(1)






New vehicle inventory

23


50


61

Used vehicle inventory

58


65


47

(1)

Days supply calculated based on current inventory levels, excluding in-transit vehicles, and a 30-day historical cost of sales level.

Financial covenants





Requirement


As of June 30, 2021

Current ratio

Not less than 1.10 to 1


1.68 to 1

Fixed charge coverage ratio

Not less than 1.20 to 1


6.82 to 1

Leverage ratio

Not more than 5.75 to 1


1.95 to 1

Lithia Motors, Inc.

Condensed Consolidated Balance Sheets (Unaudited)

(In millions)




June 30, 2021


December 31, 2020

Cash and cash equivalents


$

780.9



$

160.2


Trade receivables, net


799.7



614.0


Inventories, net


2,238.8



2,492.9


Other current assets


51.4



70.5


Total current assets


$

3,870.8



$

3,337.6







Property and equipment, net


2,299.3



2,197.5


Intangibles


987.0



943.2


Other non-current assets


2,935.4



1,423.8


Total assets


$

10,092.5



$

7,902.1







Floor plan notes payable


1,252.0



1,797.2


Other current liabilities


1,343.8



682.5


Total current liabilities


$

2,595.8



$

2,479.7







Long-term debt


2,521.9



2,064.7


Other long-term liabilities and deferred revenue


746.4



696.2


Total liabilities


$

5,864.1



$

5,240.6







Stockholder's Equity


4,228.4



2,661.5


Total liabilities & stockholders' equity


$

10,092.5



$

7,902.1


Lithia Motors, Inc.

Summarized Cash Flow from Operations (Unaudited)

(In millions)




Six months ended June 30,



2021


2020

Net income


$

461.1



$

123.9


Adjustments to reconcile net income to net cash provided by operating activities:





Asset impairments




7.9


Depreciation and amortization


57.1



44.3


Stock-based compensation


17.2



10.1


Loss on disposal of assets


0.1



(0.3)


Loss (gain) on sale of franchises


5.2



(1.4)


Unrealized investment loss


(0.9)




Deferred income taxes


31.8



(4.9)


Amortization of operating lease right-of-use assets


16.5



13.5


(Increase) decrease:





Trade receivables, net


(185.0)



53.8


Inventories


663.1



624.7


Other assets


(103.0)



(14.8)


Increase (decrease):





Floor plan notes payable, net


47.0



(130.7)


Trade payables


97.4



0.3


Accrued liabilities


144.3



55.4


Other long-term liabilities and deferred revenue


11.6



8.2


Net cash provided by operating activities


$

1,263.5



$

790.0


Lithia Motors, Inc.

Reconciliation of Non-GAAP Cash Flow from Operations (Unaudited)

(In millions)




Six months ended June 30,

Net cash provided by operating activities


2021


2020

As reported


$

1,263.5



$

790.0


Floor plan notes payable, non-trade, net


(571.6)



(456.8)


Less: Borrowings on floor plan notes payable, non-trade associated with acquired new vehicle inventory


(271.5)



(22.3)


Adjusted


$

420.4



$

310.9


Lithia Motors, Inc.

Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)

(In millions, except for per share data)




Three Months Ended June 30, 2021



As reported


Net disposal
loss on sale
of stores


Investment
gain


Insurance
reserves


Acquisition
expenses


Adjusted

Selling, general and administrative


$

634.0



$

(4.5)



$



$

(0.8)



$

(10.4)



$

618.3















Operating income


446.3



4.5





0.8



10.4



462.0















Other income (expense), net


7.6





(1.2)







6.4















Income before income taxes


419.4



4.5



(1.2)



0.8



10.4



433.9


Income tax (provision) benefit


(114.5)



(1.2)



0.3



(0.2)



(2.8)



(118.4)


Net income


$

304.9



$

3.3



$

(0.9)



$

0.6



$

7.6



$

315.5















Diluted earnings per share


$

10.75



$

0.12



$

(0.03)



$

0.02



$

0.26



$

11.12


Diluted share count


28.4














Three Months Ended June 30, 2020



As reported


Net disposal
gain on sale
of stores


Asset
impairment


Insurance
reserves


Acquisition
expenses


Tax attribute


Adjusted

Asset impairments


$

7.9



$



$

(7.9)



$



$



$



$

















Selling, general and administrative


304.5



1.3





(5.0)



(0.5)





300.3

















Operating income


129.7



(1.3)



7.9



5.0



0.5





141.8

















Income before income taxes


108.3



(1.3)



7.9



5.0



0.5





120.4


Income tax (provision) benefit


(30.6)



0.4



(2.3)



(1.4)



(0.2)



(0.8)



(34.9)


Net income


$

77.7



$

(0.9)



$

5.6



$

3.6



$

0.3



$

(0.8)



$

85.5

















Diluted earnings per share


$

3.38



$

(0.04)



$

0.24



$

0.16



$

0.01



$

(0.03)



$

3.72


Diluted share count


23.0














Lithia Motors, Inc.

Reconciliation of Certain Non-GAAP Financial Measures (Unaudited)

(In millions, except for per share data)




Six Months Ended June 30, 2021



As reported


Net disposal
loss on sale
of stores


Investment
gain


Insurance
reserves


Acquisition
expenses


Adjusted

Selling, general and administrative


$

1,084.2



$

(5.2)



$



$

(1.6)



$

(11.6)



$

1,065.8















Operating income


684.7



5.2





1.6



11.6



703.1















Other income (expense), net


11.1





(1.0)







10.1















Income before income taxes


630.9



5.2



(1.0)



1.6



11.6



648.3


Income tax (provision) benefit


(169.8)



(1.4)



0.3



(0.4)



(3.1)



(174.4)


Net income


$

461.1



$

3.8



$

(0.7)



$

1.2



$

8.5



$

473.9















Diluted earnings per share


$

16.69



$

0.14



$

(0.03)



$

0.04



$

0.31



$

17.15


Diluted share count


27.6














Six Months Ended June 30, 2020



As reported


Net disposal
gain on sale
of stores


Asset
impairment


Insurance
reserves


Acquisition
expenses


Tax attribute


Adjusted

Asset impairments


$

7.9



$



$

(7.9)



$



$



$



$

















Selling, general and administrative


$

650.5



$

1.4



$



$

(5.8)



$

(1.0)



$



$

645.1

















Operating income


222.6



(1.4)



7.9



5.8



1.0





235.9

















Income before income taxes


172.5



(1.4)



7.9



5.8



1.0





185.8


Income tax (provision) benefit


(48.6)



0.4



(2.3)



(1.6)



(0.3)



(0.8)



(53.2)


Net income


$

123.9



$

(1.0)



$

5.6



$

4.2



$

0.7



$

(0.8)



$

132.6

















Diluted earnings per share


$

5.32



$

(0.04)



$

0.24



$

0.18



$

0.03



$

(0.03)



$

5.70


Diluted share count


23.3














Lithia Motors, Inc.

Adjusted EBITDA and Net Debt to Adjusted EBITDA (Unaudited)

(In millions)




Three months ended June 30,


%


Six months ended June 30,


%




Increase



Increase



2021


2020


(Decrease)


2021


2020


(Decrease)

EBITDA and Adjusted EBITDA













Net income


$

304.9



$

77.7



292.4

%


$

461.1



$

123.9



272.2

%

Flooring interest expense


6.4



8.1



(21.0)



13.3



22.1



(39.8)


Other interest expense


28.1



16.8



67.3



51.6



33.8



52.7


Income tax expense


114.5



30.6



274.2



169.8



48.6



249.4


Depreciation and amortization


30.3



22.3



35.9



57.2



44.3



29.1


EBITDA


$

484.2



$

155.5



211.4

%


$

753.0



$

272.7



176.1

%














Other adjustments:













Less: flooring interest expense


$

(6.4)



$

(8.1)



(21.0)



$

(13.3)



$

(22.1)



(39.8)


Less: used vehicle line of credit interest




(0.1)



(100.0)





(0.3)



(100.0)


Add: acquisition expenses


10.4



0.5



1,980.0



11.6



1.0



1,060.0


Add: loss (gain) on divestitures


4.5



(1.3)



(446.2)



5.2



(1.4)



NM


Less: investment gain


(1.2)





NM



(1.0)





NM


Add: insurance reserves


0.8



5.0



(84.0)



1.6



5.8



(72.4)


Add: asset impairment




7.9



(100.0)





7.9



NM


Adjusted EBITDA


$

492.3



$

159.4



208.8

%


$

757.1



$

263.6



187.2

%

NM - not meaningful



As of


%



June 30,


Increase

Net Debt to Adjusted EBITDA


2021


2020


(Decrease)

Floor plan notes payable: non-trade


$

966.9



$

1,168.6



(17.3)

%

Floor plan notes payable


285.1



292.0



(2.4)


Used and service loaner vehicle inventory financing facility




40.0



(100.0)


Revolving lines of credit


200.0





NM


Real estate mortgages


612.8



636.9



(3.8)


Finance lease obligations


170.2



45.3



275.7


5.250% Senior notes due 2025


300.0



300.0




4.625% Senior notes due 2027


400.0



400.0




4.375% Senior notes due 2031


550.0





NM


3.875% Senior notes due 2029


800.0





NM


Other debt


2.2



2.7



(18.5)


Unamortized debt issuance costs


(27.2)



(10.4)



161.5


Total debt


$

4,260.0



$

2,875.1



48.2

%








Less: Floor plan related debt


$

(1,252.0)



$

(1,500.6)



(16.6)

%

Less: Cash and cash equivalents


(780.9)



(120.3)



549.1


Less: Availability on used vehicle and service loaner financing facilities


(653.4)



(281.9)



131.8


Net Debt


$

1,573.7



$

972.3



61.9

%








TTM Adjusted EBITDA


$

1,263.5



$

539.7



134.1

%








Net debt to Adjusted EBITDA


1.25

x


1.80

x



Cision
Cision

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SOURCE Lithia & Driveway