QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading symbol(s) | Name of each exchange on which registered | ||||||
Voting |
x | Accelerated filer | o | Non-accelerated filer | o | Smaller reporting company | Emerging growth company |
Page | |||||
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | |||||
June 30, 2023 | December 31, 2022 | ||||||||||
(Unaudited) | |||||||||||
(In millions, except share and per share amounts) | |||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowance for doubtful accounts of $ | |||||||||||
Inventories | |||||||||||
Other current assets | |||||||||||
Total current assets | |||||||||||
Property and equipment, net | |||||||||||
Operating lease right-of-use assets | |||||||||||
Goodwill | |||||||||||
Other indefinite-lived intangible assets | |||||||||||
Equity method investments | |||||||||||
Other long-term assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES AND EQUITY | |||||||||||
Floor plan notes payable | $ | $ | |||||||||
Floor plan notes payable — non-trade | |||||||||||
Accounts payable | |||||||||||
Accrued expenses and other current liabilities | |||||||||||
Current portion of long-term debt | |||||||||||
Total current liabilities | |||||||||||
Long-term debt | |||||||||||
Long-term operating lease liabilities | |||||||||||
Deferred tax liabilities | |||||||||||
Other long-term liabilities | |||||||||||
Total liabilities | |||||||||||
Commitments and contingent liabilities (Note 10) | |||||||||||
Equity | |||||||||||
Penske Automotive Group stockholders' equity: | |||||||||||
Preferred Stock, $ | |||||||||||
Common Stock, $ | |||||||||||
Non-voting Common Stock, $ | |||||||||||
Class C Common Stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive income (loss) | ( | ( | |||||||||
Total Penske Automotive Group stockholders' equity | |||||||||||
Non-controlling interest | |||||||||||
Total equity | |||||||||||
Total liabilities and equity | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
(In millions, except per share amounts) | |||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Retail automotive dealership | $ | $ | $ | $ | |||||||||||||||||||
Retail commercial truck dealership | |||||||||||||||||||||||
Commercial vehicle distribution and other | |||||||||||||||||||||||
Total revenues | |||||||||||||||||||||||
Cost of sales: | |||||||||||||||||||||||
Retail automotive dealership | |||||||||||||||||||||||
Retail commercial truck dealership | |||||||||||||||||||||||
Commercial vehicle distribution and other | |||||||||||||||||||||||
Total cost of sales | |||||||||||||||||||||||
Gross profit | |||||||||||||||||||||||
Selling, general, and administrative expenses | |||||||||||||||||||||||
Depreciation | |||||||||||||||||||||||
Operating income | |||||||||||||||||||||||
Floor plan interest expense | ( | ( | ( | ( | |||||||||||||||||||
Other interest expense | ( | ( | ( | ( | |||||||||||||||||||
Equity in earnings of affiliates | |||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||
Income taxes | ( | ( | ( | ( | |||||||||||||||||||
Net income | |||||||||||||||||||||||
Less: Income attributable to non-controlling interests | |||||||||||||||||||||||
Net income attributable to Penske Automotive Group common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Basic earnings per share attributable to Penske Automotive Group common stockholders: | |||||||||||||||||||||||
Net income attributable to Penske Automotive Group common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Shares used in determining basic earnings per share | |||||||||||||||||||||||
Diluted earnings per share attributable to Penske Automotive Group common stockholders: | |||||||||||||||||||||||
Net income attributable to Penske Automotive Group common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Shares used in determining diluted earnings per share | |||||||||||||||||||||||
Amounts attributable to Penske Automotive Group common stockholders: | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Less: Income attributable to non-controlling interests | |||||||||||||||||||||||
Net income attributable to Penske Automotive Group common stockholders | $ | $ | $ | $ | |||||||||||||||||||
Cash dividends per share | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||||||
Foreign currency translation adjustment | ( | ( | |||||||||||||||||||||
Other adjustments to comprehensive income, net | |||||||||||||||||||||||
Other comprehensive income (loss), net of tax | ( | ( | |||||||||||||||||||||
Comprehensive income | |||||||||||||||||||||||
Less: Comprehensive income attributable to non-controlling interests | |||||||||||||||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | $ | $ | $ |
Six Months Ended June 30, | |||||||||||
2023 | 2022 | ||||||||||
(Unaudited) | |||||||||||
(In millions) | |||||||||||
Operating Activities: | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash from operating activities: | |||||||||||
Depreciation | |||||||||||
Earnings of equity method investments | ( | ( | |||||||||
Deferred income taxes | |||||||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | ( | ||||||||||
Inventories | ( | ( | |||||||||
Floor plan notes payable | |||||||||||
Accounts payable and accrued expenses | |||||||||||
Other | |||||||||||
Net cash provided by operating activities | |||||||||||
Investing Activities: | |||||||||||
Purchases of property, equipment, and improvements | ( | ( | |||||||||
Proceeds from sale of property and equipment | |||||||||||
Acquisitions net, including repayment of sellers' floor plan notes payable of $ | ( | ( | |||||||||
Other | ( | ( | |||||||||
Net cash used in investing activities | ( | ( | |||||||||
Financing Activities: | |||||||||||
Proceeds from borrowings under revolving U.S. credit agreement and mortgage facility | |||||||||||
Repayments under revolving U.S. credit agreement and mortgage facility | ( | ( | |||||||||
Net borrowings of other debt | |||||||||||
Net repayments of floor plan notes payable — non-trade | ( | ( | |||||||||
Repurchases of common stock | ( | ( | |||||||||
Payments of tax withholding for stock-based compensation | ( | ( | |||||||||
Dividends | ( | ( | |||||||||
Payment of debt issuance costs | ( | ( | |||||||||
Other | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash and cash equivalents | ( | ( | |||||||||
Net change in cash and cash equivalents | |||||||||||
Cash and cash equivalents, beginning of period | |||||||||||
Cash and cash equivalents, end of period | $ | $ | |||||||||
Supplemental disclosures of cash flow information: | |||||||||||
Cash paid for: | |||||||||||
Interest | $ | $ | |||||||||
Income taxes |
Three Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Voting and Non-voting Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Penske Automotive Group Stockholders' Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||
Issued Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2023 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Equity compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | — | ( | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Distributions to non-controlling interest | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | $ | $ | $ | ( | $ | $ | $ |
Three Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Voting and Non-voting Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Penske Automotive Group Stockholders' Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||
Issued Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Equity compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | — | ( | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Distributions to non-controlling interest | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2022 | $ | $ | $ | $ | ( | $ | $ | $ |
Six Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||
Voting and Non-voting Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Penske Automotive Group Stockholders’ Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||
Issued Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Equity compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | — | ( | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Distributions to non-controlling interest | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | $ | $ | $ | ( | $ | $ | $ |
Six Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Voting and Non-voting Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Penske Automotive Group Stockholders’ Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||
Issued Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
— | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||
Equity compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | — | ( | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Distributions to non-controlling interest | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2022 | $ | $ | $ | $ | ( | $ | $ | $ |
Level 1 | Quoted prices in active markets for identical assets or liabilities | ||||
Level 2 | Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted market prices in markets that are not active, or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities | ||||
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities |
June 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||||
$ | |||||||||||||||||||||||
Mortgage facilities (1) | |||||||||||||||||||||||
_____________________ | |||||||||||||||||||||||
(1)In addition to fixed rate debt, our mortgage facilities also include a revolving mortgage facility through Toyota Motor Credit Corporation that bears interest at a variable rate based on the prime rate. The fair value equals the carrying value. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
Retail Automotive Dealership Revenue | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
New vehicle | $ | $ | $ | $ | |||||||||||||||||||
Used vehicle | |||||||||||||||||||||||
Finance and insurance, net | |||||||||||||||||||||||
Service and parts | |||||||||||||||||||||||
Fleet and wholesale | |||||||||||||||||||||||
Total retail automotive dealership revenue | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
Retail Automotive Dealership Revenue | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
U.S. | $ | $ | $ | $ | |||||||||||||||||||
U.K. | |||||||||||||||||||||||
Germany, Italy, and Japan | |||||||||||||||||||||||
Total retail automotive dealership revenue | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
Retail Commercial Truck Dealership Revenue | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
New truck | $ | $ | $ | $ | |||||||||||||||||||
Used truck | |||||||||||||||||||||||
Finance and insurance, net | |||||||||||||||||||||||
Service and parts | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Total retail commercial truck dealership revenue | $ | $ | $ | $ |
June 30, 2023 | December 31, 2022 | ||||||||||
Accounts receivable | |||||||||||
Contracts in transit | $ | $ | |||||||||
Vehicle receivables | |||||||||||
Manufacturer receivables | |||||||||||
Trade receivables | |||||||||||
Accrued expenses | |||||||||||
Unearned revenues | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Lease Cost | |||||||||||||||||||||||
Operating lease cost (1) | $ | $ | $ | $ | |||||||||||||||||||
Sublease income | ( | ( | ( | ( | |||||||||||||||||||
Total lease cost | $ | $ | $ | $ | |||||||||||||||||||
_________________ | |||||||||||||||||||||||
(1)Includes short-term leases and variable lease costs, which are immaterial. |
Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | ||||||||||
Other Information | |||||||||||
Cash paid for amounts included in the measurement of lease liabilities | |||||||||||
Operating cash flows from operating leases | $ | $ | |||||||||
Right-of-use assets modified or obtained in exchange for operating lease liabilities, net | $ | ( | $ |
June 30, 2023 | December 31, 2022 | ||||||||||
Lease Term and Discount Rate | |||||||||||
Weighted-average remaining lease term - operating leases | |||||||||||
Weighted-average discount rate - operating leases | % | % |
Maturity of Lease Liabilities | June 30, 2023 | ||||
2023 (1) | $ | ||||
2024 | |||||
2025 | |||||
2026 | |||||
2027 | |||||
2028 | |||||
2029 and thereafter | |||||
Total future minimum lease payments | $ | ||||
Less: Imputed interest | ( | ||||
Present value of future minimum lease payments | $ | ||||
$ | |||||
Long-term operating lease liabilities | |||||
Total operating lease liabilities | $ | ||||
____________________ | |||||
(1)Excludes the six months ended June 30, 2023. | |||||
(2)Included within "Accrued expenses and other current liabilities" on Consolidated Condensed Balance Sheet as of June 30, 2023. |
June 30, 2023 | December 31, 2022 | ||||||||||
Retail automotive dealership new vehicles | $ | $ | |||||||||
Retail automotive dealership used vehicles | |||||||||||
Retail automotive parts, accessories, and other | |||||||||||
Retail commercial truck dealership vehicles and parts | |||||||||||
Commercial vehicle distribution vehicles, parts, and engines | |||||||||||
Total inventories | $ | $ |
June 30, | |||||||||||
2023 | 2022 | ||||||||||
Accounts receivable | $ | $ | |||||||||
Inventories | |||||||||||
Other current assets | |||||||||||
Property and equipment | |||||||||||
Indefinite-lived intangibles | |||||||||||
Other noncurrent assets | |||||||||||
Current liabilities | ( | ( | |||||||||
Noncurrent liabilities | ( | ||||||||||
Total cash used in acquisitions | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||||||||||
Net income attributable to Penske Automotive Group common stockholders | |||||||||||||||||||||||
Net income per diluted common share | $ | $ | $ | $ |
Goodwill | Other Indefinite- Lived Intangible Assets | ||||||||||
Balance, January 1, 2023 | $ | $ | |||||||||
Additions | |||||||||||
Disposals | |||||||||||
Foreign currency translation | |||||||||||
Balance, June 30, 2023 | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Weighted average number of common shares outstanding | |||||||||||||||||||||||
Effect of non-participatory equity compensation | |||||||||||||||||||||||
Weighted average number of common shares outstanding, including effect of dilutive securities |
June 30, 2023 | December 31, 2022 | |||||||||||||
U.S. credit agreement — revolving credit line | $ | $ | ||||||||||||
U.K. credit agreement — revolving credit line | ||||||||||||||
Canada credit agreement | ||||||||||||||
Australia credit agreement | ||||||||||||||
Mortgage facilities | ||||||||||||||
Other | ||||||||||||||
Total long-term debt | ||||||||||||||
Less: current portion | ( | ( | ||||||||||||
Net long-term debt | $ | $ |
Description | Maturity Date | Interest Payment Dates | Principal Amount | |||||||||||||||||
September 1, 2025 | February 15, August 15 | $ | ||||||||||||||||||
June 15, 2029 | June 15, December 15 | $ |
Foreign Currency Translation | Other | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Balance at March 31, 2023 | $ | ( | $ | ( | $ | ( | |||||||||||
Other comprehensive income (loss) before reclassifications | |||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) — net of tax | |||||||||||||||||
Net current period other comprehensive income (loss) | |||||||||||||||||
Balance at June 30, 2023 | $ | ( | $ | $ | ( |
Foreign Currency Translation | Other | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Balance at March 31, 2022 | $ | ( | $ | $ | ( | ||||||||||||
Other comprehensive income (loss) before reclassifications | ( | ( | |||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) — net of tax | |||||||||||||||||
Net current period other comprehensive income (loss) | ( | ( | |||||||||||||||
Balance at June 30, 2022 | $ | ( | $ | $ | ( |
Foreign Currency Translation | Other | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Balance at December 31, 2022 | $ | ( | $ | ( | $ | ( | |||||||||||
Other comprehensive income (loss) before reclassifications | |||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) — net of tax | |||||||||||||||||
Net current period other comprehensive income (loss) | |||||||||||||||||
Balance at June 30, 2023 | $ | ( | $ | $ | ( |
Foreign Currency Translation | Other | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||
Balance at December 31, 2021 | $ | ( | $ | $ | ( | ||||||||||||
Other comprehensive income (loss) before reclassifications | ( | ( | |||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) — net of tax | |||||||||||||||||
Net current period other comprehensive income (loss) | ( | ( | |||||||||||||||
Balance at June 30, 2022 | $ | ( | $ | $ | ( |
Retail Automotive | Retail Commercial Truck | Other | Non-Automotive Investments | Intersegment Elimination | Total | ||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||
2023 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
2022 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
Segment income | |||||||||||||||||||||||||||||||||||
2023 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
2022 | $ | $ | $ | $ | $ |
Retail Automotive | Retail Commercial Truck | Other | Non-Automotive Investments | Intersegment Elimination | Total | ||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||
2023 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
2022 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||
Segment income | |||||||||||||||||||||||||||||||||||
2023 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
2022 | $ | $ | $ | $ | $ |
2023 vs. 2022 | ||||||||||||||||||||||||||
New Vehicle Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
New retail unit sales (excluding agency) | 49,562 | 45,515 | 4,047 | 8.9 | % | |||||||||||||||||||||
Same-store new retail unit sales (excluding agency) | 48,923 | 44,920 | 4,003 | 8.9 | % | |||||||||||||||||||||
New agency unit sales | 8,931 | — | 8,931 | nm | ||||||||||||||||||||||
Same-store new agency unit sales | 7,554 | — | 7,554 | nm | ||||||||||||||||||||||
New sales revenue | $ | 2,820.1 | $ | 2,446.0 | $ | 374.1 | 15.3 | % | ||||||||||||||||||
Same-store new sales revenue | $ | 2,782.4 | $ | 2,416.6 | $ | 365.8 | 15.1 | % | ||||||||||||||||||
New retail sales revenue per unit (excluding agency) | $ | 56,557 | $ | 53,740 | $ | 2,817 | 5.2 | % | ||||||||||||||||||
Same-store new retail sales revenue per unit (excluding agency) | $ | 56,592 | $ | 53,799 | $ | 2,793 | 5.2 | % | ||||||||||||||||||
Gross profit — new | $ | 326.8 | $ | 312.3 | $ | 14.5 | 4.6 | % | ||||||||||||||||||
Same-store gross profit — new | $ | 321.4 | $ | 309.1 | $ | 12.3 | 4.0 | % | ||||||||||||||||||
Average gross profit per new vehicle (excluding agency) | $ | 6,259 | $ | 6,860 | $ | (601) | (8.8) | % | ||||||||||||||||||
Same-store average gross profit per new vehicle (excluding agency) | $ | 6,298 | $ | 6,880 | $ | (582) | (8.5) | % | ||||||||||||||||||
Gross margin % — new | 11.6 | % | 12.8 | % | (1.2) | % | (9.4) | % | ||||||||||||||||||
Same-store gross margin % — new | 11.6 | % | 12.8 | % | (1.2) | % | (9.4) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Used Vehicle Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Used retail unit sales | 65,386 | 69,994 | (4,608) | (6.6) | % | |||||||||||||||||||||
Same-store used retail unit sales | 63,726 | 68,921 | (5,195) | (7.5) | % | |||||||||||||||||||||
Used retail sales revenue | $ | 2,330.3 | $ | 2,387.8 | $ | (57.5) | (2.4) | % | ||||||||||||||||||
Same-store used retail sales revenue | $ | 2,269.8 | $ | 2,353.3 | $ | (83.5) | (3.5) | % | ||||||||||||||||||
Used retail sales revenue per unit | $ | 35,639 | $ | 34,114 | $ | 1,525 | 4.5 | % | ||||||||||||||||||
Same-store used retail sales revenue per unit | $ | 35,618 | $ | 34,145 | $ | 1,473 | 4.3 | % | ||||||||||||||||||
Gross profit — used | $ | 123.3 | $ | 155.2 | $ | (31.9) | (20.6) | % | ||||||||||||||||||
Same-store gross profit — used | $ | 121.2 | $ | 153.7 | $ | (32.5) | (21.1) | % | ||||||||||||||||||
Average gross profit per used vehicle retailed | $ | 1,887 | $ | 2,218 | $ | (331) | (14.9) | % | ||||||||||||||||||
Same-store average gross profit per used vehicle retailed | $ | 1,902 | $ | 2,230 | $ | (328) | (14.7) | % | ||||||||||||||||||
Gross margin % — used | 5.3 | % | 6.5 | % | (1.2) | % | (18.5) | % | ||||||||||||||||||
Same-store gross margin % — used | 5.3 | % | 6.5 | % | (1.2) | % | (18.5) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Finance and Insurance Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Total retail unit sales | 114,948 | 115,509 | (561) | (0.5) | % | |||||||||||||||||||||
Total same-store retail unit sales | 112,649 | 113,841 | (1,192) | (1.0) | % | |||||||||||||||||||||
Total agency unit sales | 8,931 | — | 8,931 | nm | ||||||||||||||||||||||
Total same-store agency unit sales | 7,554 | — | 7,554 | nm | ||||||||||||||||||||||
Finance and insurance revenue | $ | 214.1 | $ | 221.4 | $ | (7.3) | (3.3) | % | ||||||||||||||||||
Same-store finance and insurance revenue | $ | 209.3 | $ | 218.4 | $ | (9.1) | (4.2) | % | ||||||||||||||||||
Finance and insurance revenue per unit (excluding agency) | $ | 1,840 | $ | 1,917 | $ | (77) | (4.0) | % | ||||||||||||||||||
Same-store finance and insurance revenue per unit (excluding agency) | $ | 1,834 | $ | 1,918 | $ | (84) | (4.4) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Service and Parts Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Service and parts revenue | $ | 685.2 | $ | 597.0 | $ | 88.2 | 14.8 | % | ||||||||||||||||||
Same-store service and parts revenue | $ | 653.0 | $ | 589.7 | $ | 63.3 | 10.7 | % | ||||||||||||||||||
Gross profit — service and parts | $ | 406.5 | $ | 359.2 | $ | 47.3 | 13.2 | % | ||||||||||||||||||
Same-store service and parts gross profit | $ | 391.1 | $ | 354.7 | $ | 36.4 | 10.3 | % | ||||||||||||||||||
Gross margin % — service and parts | 59.3 | % | 60.2 | % | (0.9) | % | (1.5) | % | ||||||||||||||||||
Same-store service and parts gross margin % | 59.9 | % | 60.1 | % | (0.2) | % | (0.3) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
New Commercial Truck Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
New retail unit sales | 4,539 | 3,531 | 1,008 | 28.5 | % | |||||||||||||||||||||
Same-store new retail unit sales | 4,510 | 3,531 | 979 | 27.7 | % | |||||||||||||||||||||
New retail sales revenue | $ | 616.4 | $ | 447.3 | $ | 169.1 | 37.8 | % | ||||||||||||||||||
Same-store new retail sales revenue | $ | 611.7 | $ | 447.3 | $ | 164.4 | 36.8 | % | ||||||||||||||||||
New retail sales revenue per unit | $ | 135,798 | $ | 126,676 | $ | 9,122 | 7.2 | % | ||||||||||||||||||
Same-store new retail sales revenue per unit | $ | 135,637 | $ | 126,676 | $ | 8,961 | 7.1 | % | ||||||||||||||||||
Gross profit — new | $ | 37.5 | $ | 26.5 | $ | 11.0 | 41.5 | % | ||||||||||||||||||
Same-store gross profit — new | $ | 37.0 | $ | 26.5 | $ | 10.5 | 39.6 | % | ||||||||||||||||||
Average gross profit per new truck retailed | $ | 8,254 | $ | 7,504 | $ | 750 | 10.0 | % | ||||||||||||||||||
Same-store average gross profit per new truck retailed | $ | 8,211 | $ | 7,504 | $ | 707 | 9.4 | % | ||||||||||||||||||
Gross margin % — new | 6.1 | % | 5.9 | % | 0.2 | % | 3.4 | % | ||||||||||||||||||
Same-store gross margin % — new | 6.0 | % | 5.9 | % | 0.1 | % | 1.7 | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Used Commercial Truck Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Used retail unit sales | 704 | 643 | 61 | 9.5 | % | |||||||||||||||||||||
Same-store used retail unit sales | 701 | 643 | 58 | 9.0 | % | |||||||||||||||||||||
Used retail sales revenue | $ | 52.4 | $ | 78.7 | $ | (26.3) | (33.4) | % | ||||||||||||||||||
Same-store used retail sales revenue | $ | 52.2 | $ | 78.7 | $ | (26.5) | (33.7) | % | ||||||||||||||||||
Used retail sales revenue per unit | $ | 74,421 | $ | 122,415 | $ | (47,994) | (39.2) | % | ||||||||||||||||||
Same-store used retail sales revenue per unit | $ | 74,485 | $ | 122,415 | $ | (47,930) | (39.2) | % | ||||||||||||||||||
Gross profit — used | $ | 4.0 | $ | 5.9 | $ | (1.9) | (32.2) | % | ||||||||||||||||||
Same-store gross profit — used | $ | 4.0 | $ | 5.9 | $ | (1.9) | (32.2) | % | ||||||||||||||||||
Average gross profit per used truck retailed | $ | 5,722 | $ | 9,133 | $ | (3,411) | (37.3) | % | ||||||||||||||||||
Same-store average gross profit per used truck retailed | $ | 5,733 | $ | 9,133 | $ | (3,400) | (37.2) | % | ||||||||||||||||||
Gross margin % — used | 7.6 | % | 7.5 | % | 0.1 | % | 1.3 | % | ||||||||||||||||||
Same-store gross margin % — used | 7.7 | % | 7.5 | % | 0.2 | % | 2.7 | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Service and Parts Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Service and parts revenue | $ | 232.1 | $ | 219.6 | $ | 12.5 | 5.7 | % | ||||||||||||||||||
Same-store service and parts revenue | $ | 229.3 | $ | 219.6 | $ | 9.7 | 4.4 | % | ||||||||||||||||||
Gross profit — service and parts | $ | 95.4 | $ | 92.3 | $ | 3.1 | 3.4 | % | ||||||||||||||||||
Same-store service and parts gross profit | $ | 94.3 | $ | 92.3 | $ | 2.0 | 2.2 | % | ||||||||||||||||||
Gross margin % — service and parts | 41.1 | % | 42.0 | % | (0.9) | % | (2.1) | % | ||||||||||||||||||
Same-store service and parts gross margin % | 41.1 | % | 42.0 | % | (0.9) | % | (2.1) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Penske Australia Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Commercial vehicle units (wholesale and retail) | 323 | 357 | (34) | (9.5) | % | |||||||||||||||||||||
Power system units | 270 | 375 | (105) | (28.0) | % | |||||||||||||||||||||
Sales revenue | $ | 143.3 | $ | 140.9 | $ | 2.4 | 1.7 | % | ||||||||||||||||||
Gross profit | $ | 40.3 | $ | 41.0 | $ | (0.7) | (1.7) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Selling, General, and Administrative Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Personnel expense | $ | 518.3 | $ | 510.6 | $ | 7.7 | 1.5 | % | ||||||||||||||||||
Advertising expense | $ | 35.2 | $ | 31.2 | $ | 4.0 | 12.8 | % | ||||||||||||||||||
Rent & related expense | $ | 97.7 | $ | 92.9 | $ | 4.8 | 5.2 | % | ||||||||||||||||||
Other expense | $ | 206.9 | $ | 183.0 | $ | 23.9 | 13.1 | % | ||||||||||||||||||
Total SG&A expenses | $ | 858.1 | $ | 817.7 | $ | 40.4 | 4.9 | % | ||||||||||||||||||
Same-store SG&A expenses | $ | 832.1 | $ | 807.3 | $ | 24.8 | 3.1 | % | ||||||||||||||||||
Personnel expense as % of gross profit | 40.7 | % | 41.3 | % | (0.6) | % | (1.5) | % | ||||||||||||||||||
Advertising expense as % of gross profit | 2.8 | % | 2.5 | % | 0.3 | % | 12.0 | % | ||||||||||||||||||
Rent & related expense as % of gross profit | 7.7 | % | 7.5 | % | 0.2 | % | 2.7 | % | ||||||||||||||||||
Other expense as % of gross profit | 16.2 | % | 14.8 | % | 1.4 | % | 9.5 | % | ||||||||||||||||||
Total SG&A expenses as % of gross profit | 67.4 | % | 66.1 | % | 1.3 | % | 2.0 | % | ||||||||||||||||||
Same-store SG&A expenses as % of same-store gross profit | 66.9 | % | 65.9 | % | 1.0 | % | 1.5 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Depreciation | $ | 34.1 | $ | 31.7 | 2.4 | 7.6 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Floor plan interest expense | $ | 30.8 | $ | 9.0 | 21.8 | 242.2 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Other interest expense | $ | 24.2 | $ | 17.0 | 7.2 | 42.4 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Equity in earnings of affiliates | $ | 74.5 | $ | 138.0 | (63.5) | (46.0) | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Income taxes | $ | 97.7 | $ | 123.7 | (26.0) | (21.0) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
New Vehicle Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
New retail unit sales (excluding agency) | 97,224 | 91,043 | 6,181 | 6.8 | % | |||||||||||||||||||||
Same-store new retail unit sales (excluding agency) | 94,403 | 89,282 | 5,121 | 5.7 | % | |||||||||||||||||||||
New agency unit sales | 15,864 | — | 15,864 | nm | ||||||||||||||||||||||
Same-store new agency unit sales | 13,428 | — | 13,428 | nm | ||||||||||||||||||||||
New sales revenue | $ | 5,541.4 | $ | 4,891.5 | $ | 649.9 | 13.3 | % | ||||||||||||||||||
Same-store new sales revenue | $ | 5,395.1 | $ | 4,813.5 | $ | 581.6 | 12.1 | % | ||||||||||||||||||
New retail sales revenue per unit (excluding agency) | $ | 56,687 | $ | 53,727 | $ | 2,960 | 5.5 | % | ||||||||||||||||||
Same-store new retail sales revenue per unit (excluding agency) | $ | 56,889 | $ | 53,914 | $ | 2,975 | 5.5 | % | ||||||||||||||||||
Gross profit — new | $ | 640.6 | $ | 623.7 | $ | 16.9 | 2.7 | % | ||||||||||||||||||
Same-store gross profit — new | $ | 624.0 | $ | 616.6 | $ | 7.4 | 1.2 | % | ||||||||||||||||||
Average gross profit per new vehicle (excluding agency) | $ | 6,287 | $ | 6,850 | $ | (563) | (8.2) | % | ||||||||||||||||||
Same-store average gross profit per new vehicle (excluding agency) | $ | 6,358 | $ | 6,906 | $ | (548) | (7.9) | % | ||||||||||||||||||
Gross margin % — new | 11.6 | % | 12.8 | % | (1.2) | % | (9.4) | % | ||||||||||||||||||
Same-store gross margin % — new | 11.6 | % | 12.8 | % | (1.2) | % | (9.4) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Used Vehicle Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Used retail unit sales | 133,222 | 138,225 | (5,003) | (3.6) | % | |||||||||||||||||||||
Same-store used retail unit sales | 128,555 | 135,390 | (6,835) | (5.0) | % | |||||||||||||||||||||
Used retail sales revenue | $ | 4,627.4 | $ | 4,810.7 | $ | (183.3) | (3.8) | % | ||||||||||||||||||
Same-store used retail sales revenue | $ | 4,461.3 | $ | 4,721.7 | $ | (260.4) | (5.5) | % | ||||||||||||||||||
Used retail sales revenue per unit | $ | 34,735 | $ | 34,803 | $ | (68) | (0.2) | % | ||||||||||||||||||
Same-store used retail sales revenue per unit | $ | 34,703 | $ | 34,875 | $ | (172) | (0.5) | % | ||||||||||||||||||
Gross profit — used | $ | 245.9 | $ | 311.0 | $ | (65.1) | (20.9) | % | ||||||||||||||||||
Same-store gross profit — used | $ | 239.2 | $ | 307.0 | $ | (67.8) | (22.1) | % | ||||||||||||||||||
Average gross profit per used vehicle retailed | $ | 1,847 | $ | 2,250 | $ | (403) | (17.9) | % | ||||||||||||||||||
Same-store average gross profit per used vehicle retailed | $ | 1,861 | $ | 2,268 | $ | (407) | (17.9) | % | ||||||||||||||||||
Gross margin % — used | 5.3 | % | 6.5 | % | (1.2) | % | (18.5) | % | ||||||||||||||||||
Same-store gross margin % — used | 5.4 | % | 6.5 | % | (1.1) | % | (16.9) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Finance and Insurance Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Total retail unit sales | 230,446 | 229,268 | 1,178 | 0.5 | % | |||||||||||||||||||||
Total same-store retail unit sales | 222,958 | 224,672 | (1,714) | (0.8) | % | |||||||||||||||||||||
Total agency unit sales | 15,864 | — | 15,864 | nm | ||||||||||||||||||||||
Total same-store agency unit sales | 13,428 | — | 13,428 | nm | ||||||||||||||||||||||
Finance and insurance revenue | $ | 420.9 | $ | 438.7 | $ | (17.8) | (4.1) | % | ||||||||||||||||||
Same-store finance and insurance revenue | $ | 408.5 | $ | 433.3 | $ | (24.8) | (5.7) | % | ||||||||||||||||||
Finance and insurance revenue per unit (excluding agency) | $ | 1,806 | $ | 1,914 | $ | (108) | (5.6) | % | ||||||||||||||||||
Same-store finance and insurance revenue per unit (excluding agency) | $ | 1,812 | $ | 1,928 | $ | (116) | (6.0) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Service and Parts Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Service and parts revenue | $ | 1,368.2 | $ | 1,183.2 | $ | 185.0 | 15.6 | % | ||||||||||||||||||
Same-store service and parts revenue | $ | 1,288.9 | $ | 1,167.1 | $ | 121.8 | 10.4 | % | ||||||||||||||||||
Gross profit — service and parts | $ | 805.4 | $ | 709.7 | $ | 95.7 | 13.5 | % | ||||||||||||||||||
Same-store service and parts gross profit | $ | 766.2 | $ | 700.2 | $ | 66.0 | 9.4 | % | ||||||||||||||||||
Gross margin % — service and parts | 58.9 | % | 60.0 | % | (1.1) | % | (1.8) | % | ||||||||||||||||||
Same-store service and parts gross margin % | 59.4 | % | 60.0 | % | (0.6) | % | (1.0) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
New Commercial Truck Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
New retail unit sales | 9,056 | 7,386 | 1,670 | 22.6 | % | |||||||||||||||||||||
Same-store new retail unit sales | 8,610 | 7,175 | 1,435 | 20.0 | % | |||||||||||||||||||||
New retail sales revenue | $ | 1,216.6 | $ | 919.0 | $ | 297.6 | 32.4 | % | ||||||||||||||||||
Same-store new retail sales revenue | $ | 1,164.6 | $ | 893.5 | $ | 271.1 | 30.3 | % | ||||||||||||||||||
New retail sales revenue per unit | $ | 134,345 | $ | 124,422 | $ | 9,923 | 8.0 | % | ||||||||||||||||||
Same-store new retail sales revenue per unit | $ | 135,259 | $ | 124,527 | $ | 10,732 | 8.6 | % | ||||||||||||||||||
Gross profit — new | $ | 70.0 | $ | 55.5 | $ | 14.5 | 26.1 | % | ||||||||||||||||||
Same-store gross profit — new | $ | 66.0 | $ | 53.8 | $ | 12.2 | 22.7 | % | ||||||||||||||||||
Average gross profit per new truck retailed | $ | 7,723 | $ | 7,508 | $ | 215 | 2.9 | % | ||||||||||||||||||
Same-store average gross profit per new truck retailed | $ | 7,665 | $ | 7,493 | $ | 172 | 2.3 | % | ||||||||||||||||||
Gross margin % — new | 5.8 | % | 6.0 | % | (0.2) | % | (3.3) | % | ||||||||||||||||||
Same-store gross margin % — new | 5.7 | % | 6.0 | % | (0.3) | % | (5.0) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Used Commercial Truck Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Used retail unit sales | 1,359 | 1,480 | (121) | (8.2) | % | |||||||||||||||||||||
Same-store used retail unit sales | 1,327 | 1,464 | (137) | (9.4) | % | |||||||||||||||||||||
Used retail sales revenue | $ | 101.9 | $ | 179.0 | $ | (77.1) | (43.1) | % | ||||||||||||||||||
Same-store used retail sales revenue | $ | 99.7 | $ | 177.5 | $ | (77.8) | (43.8) | % | ||||||||||||||||||
Used retail sales revenue per unit | $ | 75,009 | $ | 120,963 | $ | (45,954) | (38.0) | % | ||||||||||||||||||
Same-store used retail sales revenue per unit | $ | 75,162 | $ | 121,271 | $ | (46,109) | (38.0) | % | ||||||||||||||||||
Gross profit — used | $ | 9.4 | $ | 21.8 | $ | (12.4) | (56.9) | % | ||||||||||||||||||
Same-store gross profit — used | $ | 9.1 | $ | 21.5 | $ | (12.4) | (57.7) | % | ||||||||||||||||||
Average gross profit per used truck retailed | $ | 6,914 | $ | 14,691 | $ | (7,777) | (52.9) | % | ||||||||||||||||||
Same-store average gross profit per used truck retailed | $ | 6,886 | $ | 14,713 | $ | (7,827) | (53.2) | % | ||||||||||||||||||
Gross margin % — used | 9.2 | % | 12.2 | % | (3.0) | % | (24.6) | % | ||||||||||||||||||
Same-store gross margin % — used | 9.1 | % | 12.1 | % | (3.0) | % | (24.8) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Service and Parts Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Service and parts revenue | $ | 460.1 | $ | 416.6 | $ | 43.5 | 10.4 | % | ||||||||||||||||||
Same-store service and parts revenue | $ | 428.6 | $ | 398.9 | $ | 29.7 | 7.4 | % | ||||||||||||||||||
Gross profit — service and parts | $ | 193.7 | $ | 176.1 | $ | 17.6 | 10.0 | % | ||||||||||||||||||
Same-store service and parts gross profit | $ | 180.7 | $ | 169.5 | $ | 11.2 | 6.6 | % | ||||||||||||||||||
Gross margin % — service and parts | 42.1 | % | 42.3 | % | (0.2) | % | (0.5) | % | ||||||||||||||||||
Same-store service and parts gross margin % | 42.2 | % | 42.5 | % | (0.3) | % | (0.7) | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Penske Australia Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Commercial vehicle units (wholesale and retail) | 602 | 695 | (93) | (13.4) | % | |||||||||||||||||||||
Power system units | 574 | 710 | (136) | (19.2) | % | |||||||||||||||||||||
Sales revenue | $ | 286.9 | $ | 294.8 | $ | (7.9) | (2.7) | % | ||||||||||||||||||
Gross profit | $ | 83.0 | $ | 80.8 | $ | 2.2 | 2.7 | % |
2023 vs. 2022 | ||||||||||||||||||||||||||
Selling, General, and Administrative Data | 2023 | 2022 | Change | % Change | ||||||||||||||||||||||
Personnel expense | $ | 1,023.9 | $ | 1,011.7 | $ | 12.2 | 1.2 | % | ||||||||||||||||||
Advertising expense | $ | 67.6 | $ | 62.8 | $ | 4.8 | 7.6 | % | ||||||||||||||||||
Rent & related expense | $ | 193.1 | $ | 183.7 | $ | 9.4 | 5.1 | % | ||||||||||||||||||
Other expense | $ | 418.4 | $ | 357.3 | $ | 61.1 | 17.1 | % | ||||||||||||||||||
Total SG&A expenses | $ | 1,703.0 | $ | 1,615.5 | $ | 87.5 | 5.4 | % | ||||||||||||||||||
Same-store SG&A expenses | $ | 1,628.2 | $ | 1,587.4 | $ | 40.8 | 2.6 | % | ||||||||||||||||||
Personnel expense as % of gross profit | 40.5 | % | 41.0 | % | (0.5) | % | (1.2) | % | ||||||||||||||||||
Advertising expense as % of gross profit | 2.7 | % | 2.5 | % | 0.2 | % | 8.0 | % | ||||||||||||||||||
Rent & related expense as % of gross profit | 7.6 | % | 7.4 | % | 0.2 | % | 2.7 | % | ||||||||||||||||||
Other expense as % of gross profit | 16.6 | % | 14.5 | % | 2.1 | % | 14.5 | % | ||||||||||||||||||
Total SG&A expenses as % of gross profit | 67.4 | % | 65.4 | % | 2.0 | % | 3.1 | % | ||||||||||||||||||
Same-store SG&A expenses as % of same-store gross profit | 66.9 | % | 65.2 | % | 1.7 | % | 2.6 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Depreciation | $ | 68.0 | $ | 63.6 | 4.4 | 6.9 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Floor plan interest expense | $ | 58.7 | $ | 16.5 | 42.2 | 255.8 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Other interest expense | $ | 45.0 | $ | 33.5 | 11.5 | 34.3 | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Equity in earnings of affiliates | $ | 156.6 | $ | 257.6 | (101.0) | (39.2) | % |
2023 vs. 2022 | |||||||||||||||||||||||
2023 | 2022 | Change | % Change | ||||||||||||||||||||
Income taxes | $ | 205.0 | $ | 251.8 | (46.8) | (18.6) | % |
2022 | |||||
First Quarter | $ | 0.47 | |||
Second Quarter | $ | 0.50 | |||
Third Quarter | $ | 0.53 | |||
Fourth Quarter | $ | 0.57 |
2023 | |||||
First Quarter | $ | 0.61 | |||
Second Quarter | $ | 0.66 | |||
(In millions) | June 30, 2023 | ||||
U.S. credit agreement — revolving credit line | $ | — | |||
U.K. credit agreement — revolving credit line | — | ||||
3.50% senior subordinated notes due 2025 | 546.9 | ||||
3.75% senior subordinated notes due 2029 | 495.4 | ||||
Canada credit agreement | 53.2 | ||||
Australia credit agreement | 24.1 | ||||
Mortgage facilities | 585.6 | ||||
Other | 38.5 | ||||
Total long-term debt | $ | 1,743.7 |
PAG and Guarantor Subsidiaries | |||||||||||
Six Months Ended June 30, 2023 | Twelve Months Ended December 31, 2022 | ||||||||||
Revenues | $ | 8,054.4 | $ | 16,093.8 | |||||||
Gross profit | 1,485.5 | 3,003.6 | |||||||||
Equity in earnings of affiliates | 154.1 | 490.0 | |||||||||
Net income | 426.0 | 1,081.7 | |||||||||
Net income attributable to Penske Automotive Group | 426.0 | 1,081.7 |
PAG and Guarantor Subsidiaries | |||||||||||
June 30, 2023 | December 31, 2022 | ||||||||||
Current assets (1) | $ | 2,666.4 | $ | 2,600.2 | |||||||
Property and equipment, net | 1,385.7 | 1,342.8 | |||||||||
Equity method investments | 1,663.0 | 1,593.5 | |||||||||
Other noncurrent assets | 3,587.7 | 3,603.3 | |||||||||
Current liabilities | 2,079.6 | 2,147.5 | |||||||||
Noncurrent liabilities | 4,086.5 | 3,993.9 |
Six Months Ended June 30, | |||||||||||
(In millions) | 2023 | 2022 | |||||||||
Net cash provided by operating activities | $ | 604.5 | $ | 879.2 | |||||||
Net cash used in investing activities | (261.4) | (357.0) | |||||||||
Net cash used in financing activities | (329.6) | (459.0) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | (0.4) | (9.0) | |||||||||
Net change in cash and cash equivalents | $ | 13.1 | $ | 54.2 |
Six Months Ended June 30, | |||||||||||
(In millions) | 2023 | 2022 | |||||||||
Net cash provided by operating activities as reported | $ | 604.5 | $ | 879.2 | |||||||
Floor plan notes payable — non-trade as reported | (2.4) | (115.6) | |||||||||
Net cash provided by operating activities including all floor plan notes payable | $ | 602.1 | $ | 763.6 |
Location | Dealerships | Ownership Interest | ||||||||||||
Fairfield, Connecticut | Audi, Mercedes-Benz, Sprinter, Porsche | 80.00% (A) | ||||||||||||
Greenwich, Connecticut | Mercedes-Benz | 80.00% (A) | ||||||||||||
Northern Italy | BMW, MINI, Maserati, Porsche, Audi, Jaguar, Land Rover, Volvo, Mercedes-Benz, smart, Lamborghini | 84.10% (A) | ||||||||||||
Frankfurt, Germany | Lexus, Toyota, Volkswagen | 50.00% (B) | ||||||||||||
Barcelona, Spain | BMW, MINI | 50.00% (B) | ||||||||||||
__________________ | ||||||||||||||
(A) Entity is consolidated in our financial statements. | ||||||||||||||
(B) Entity is accounted for using the equity method of accounting. |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Program (in millions) | |||||||||||||||||||||||||
April 1 to April 30, 2023 | — | $ | — | — | $214.1 | ||||||||||||||||||||||||
May 1 to May 31, 2023 | 1,379,092 | $ | 140.11 | 1,379,092 | $270.9 | ||||||||||||||||||||||||
June 1 to June 30, 2023 | 334,140 | (1) | $ | 140.81 | 171,966 | $246.3 | |||||||||||||||||||||||
1,713,232 | 1,551,058 | ||||||||||||||||||||||||||||
(1) Includes 162,174 shares acquired from employees in connection with a net share settlement feature of employee equity awards |
Exhibit No. | Description | |||||||
3.1 | ||||||||
3.2 | ||||||||
22.1 | ||||||||
31.1 | ||||||||
31.2 | ||||||||
32 | ||||||||
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PENSKE AUTOMOTIVE GROUP, INC. | ||||||||
By: | /s/ Roger Penske | |||||||
Roger Penske | ||||||||
Date: July 27, 2023 | Chief Executive Officer | |||||||
By: | /s/ Michelle Hulgrave | |||||||
Michelle Hulgrave | ||||||||
Date: July 27, 2023 | Chief Financial Officer |
/s/ Roger Penske | |||||
Roger Penske | |||||
Chief Executive Officer |
/s/ Michelle Hulgrave | |||||
Michelle Hulgrave | |||||
Chief Financial Officer |
/s/ Roger Penske | |||||
Roger Penske | |||||
Chief Executive Officer | |||||
July 27, 2023 |
/s/ Michelle Hulgrave | |||||
Michelle Hulgrave | |||||
Chief Financial Officer | |||||
July 27, 2023 |
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 302.6 | $ 375.9 | $ 602.2 | $ 745.4 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | 33.4 | (120.3) | 51.7 | (148.8) |
Other adjustments to comprehensive income, net | 3.4 | 5.7 | 8.2 | 4.5 |
Other comprehensive income (loss), net of tax | 36.8 | (114.6) | 59.9 | (144.3) |
Comprehensive income | 339.4 | 261.3 | 662.1 | 601.1 |
Less: Comprehensive income attributable to non-controlling interests | 1.9 | 1.1 | 3.5 | 2.3 |
Comprehensive income attributable to Penske Automotive Group common stockholders | $ 337.5 | $ 260.2 | $ 658.6 | $ 598.8 |
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Statement of Cash Flows [Abstract] | ||
Repayment of sellers' floor plan notes payable | $ 21.3 | $ 51.3 |
CONSOLIDATED CONDENSED STATEMENTS OF EQUITY - USD ($) $ in Millions |
Total |
Cumulative Effect, Period of Adoption, Adjustment |
Total Penske Automotive Group Stockholders' Equity |
Total Penske Automotive Group Stockholders' Equity
Cumulative Effect, Period of Adoption, Adjustment
|
Voting and Non-voting Common Stock |
Additional Paid-in Capital |
Retained Earnings |
Retained Earnings
Cumulative Effect, Period of Adoption, Adjustment
|
Accumulated Other Comprehensive Income (Loss) |
Non-controlling Interest |
---|---|---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2021 | 77,574,172 | |||||||||
Beginning balance at Dec. 31, 2021 | $ 4,095.0 | $ (121.6) | $ 4,070.0 | $ (121.6) | $ 0.0 | $ 42.2 | $ 4,196.6 | $ (121.6) | $ (168.8) | $ 25.0 |
Increase (decrease) in stockholders' equity | ||||||||||
Equity compensation (in shares) | 307,846 | |||||||||
Equity compensation | 14.6 | 14.6 | 14.6 | |||||||
Repurchase of common stock (in shares) | (2,866,556) | |||||||||
Repurchases of common stock | (292.6) | (292.6) | (56.8) | (235.8) | ||||||
Dividends | (74.4) | (74.4) | (74.4) | |||||||
Distributions to non-controlling interest | (2.7) | (2.7) | ||||||||
Foreign currency translation | (148.8) | (147.6) | (147.6) | (1.2) | ||||||
Other | 4.5 | 4.5 | 4.5 | 0.0 | ||||||
Net income | 745.4 | 741.9 | 741.9 | 3.5 | ||||||
Ending balance (in shares) at Jun. 30, 2022 | 75,015,462 | |||||||||
Ending balance at Jun. 30, 2022 | 4,219.4 | 4,194.8 | $ 0.0 | 0.0 | 4,506.7 | (311.9) | 24.6 | |||
Beginning balance (in shares) at Mar. 31, 2022 | 76,658,405 | |||||||||
Beginning balance at Mar. 31, 2022 | 4,164.4 | 4,138.8 | $ 0.0 | 0.0 | 4,336.9 | (198.1) | 25.6 | |||
Increase (decrease) in stockholders' equity | ||||||||||
Equity compensation (in shares) | 20,164 | |||||||||
Equity compensation | 7.2 | 7.2 | 7.2 | |||||||
Repurchase of common stock (in shares) | (1,663,107) | |||||||||
Repurchases of common stock | (173.4) | (173.4) | (7.2) | (166.2) | ||||||
Dividends | (38.0) | (38.0) | (38.0) | |||||||
Distributions to non-controlling interest | (2.1) | (2.1) | ||||||||
Foreign currency translation | (120.3) | (119.5) | (119.5) | (0.8) | ||||||
Other | 5.7 | 5.7 | 5.7 | |||||||
Net income | 375.9 | 374.0 | 374.0 | 1.9 | ||||||
Ending balance (in shares) at Jun. 30, 2022 | 75,015,462 | |||||||||
Ending balance at Jun. 30, 2022 | $ 4,219.4 | 4,194.8 | $ 0.0 | 0.0 | 4,506.7 | (311.9) | 24.6 | |||
Beginning balance (in shares) at Dec. 31, 2022 | 69,681,891 | 69,681,891 | ||||||||
Beginning balance at Dec. 31, 2022 | $ 4,174.8 | 4,148.0 | $ 0.0 | 0.0 | 4,483.3 | (335.3) | 26.8 | |||
Increase (decrease) in stockholders' equity | ||||||||||
Equity compensation (in shares) | 226,757 | |||||||||
Equity compensation | 16.0 | 16.0 | 16.0 | |||||||
Repurchase of common stock (in shares) | (2,603,559) | |||||||||
Repurchases of common stock | (353.3) | (353.3) | (16.0) | (337.3) | ||||||
Dividends | (87.2) | (87.2) | (87.2) | |||||||
Distributions to non-controlling interest | (2.7) | (2.7) | ||||||||
Foreign currency translation | 51.7 | 51.3 | 51.3 | 0.4 | ||||||
Other | 8.2 | 8.2 | 8.2 | |||||||
Net income | $ 602.2 | 599.1 | 599.1 | 3.1 | ||||||
Ending balance (in shares) at Jun. 30, 2023 | 67,305,089 | 67,305,089 | ||||||||
Ending balance at Jun. 30, 2023 | $ 4,409.7 | 4,382.1 | $ 0.0 | 0.0 | 4,657.9 | (275.8) | 27.6 | |||
Beginning balance (in shares) at Mar. 31, 2023 | 69,000,558 | |||||||||
Beginning balance at Mar. 31, 2023 | 4,351.4 | 4,323.3 | $ 0.0 | 0.0 | 4,635.8 | (312.5) | 28.1 | |||
Increase (decrease) in stockholders' equity | ||||||||||
Equity compensation (in shares) | 17,763 | |||||||||
Equity compensation | 8.2 | 8.2 | 8.2 | |||||||
Repurchase of common stock (in shares) | (1,713,232) | |||||||||
Repurchases of common stock | (242.0) | (242.0) | (8.2) | (233.8) | ||||||
Dividends | (44.9) | (44.9) | (44.9) | |||||||
Distributions to non-controlling interest | (2.4) | (2.4) | ||||||||
Foreign currency translation | 33.4 | 33.3 | 33.3 | 0.1 | ||||||
Other | 3.4 | 3.4 | 3.4 | |||||||
Net income | $ 302.6 | 300.8 | 300.8 | 1.8 | ||||||
Ending balance (in shares) at Jun. 30, 2023 | 67,305,089 | 67,305,089 | ||||||||
Ending balance at Jun. 30, 2023 | $ 4,409.7 | $ 4,382.1 | $ 0.0 | $ 0.0 | $ 4,657.9 | $ (275.8) | $ 27.6 |
Interim Financial Statements |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interim Financial Statements | Interim Financial Statements Unless the context otherwise requires, the use of the terms "PAG," "we," "us," and "our" in these Notes to the Consolidated Condensed Financial Statements refers to Penske Automotive Group, Inc. and its consolidated subsidiaries. Business Overview and Concentrations We are a diversified international transportation services company and one of the world's premier automotive and commercial truck retailers. We operate dealerships in the United States, the United Kingdom, Canada, Germany, Italy, and Japan, and we are one of the largest retailers of commercial trucks in North America for Freightliner. We also distribute and retail commercial vehicles, diesel and gas engines, power systems, and related parts and services principally in Australia and New Zealand. We employ over 27,000 people worldwide. Additionally, we own 28.9% of Penske Transportation Solutions, a business that employs over 43,000 people worldwide, manages one of the largest, most comprehensive and modern trucking fleets in North America with over 431,000 trucks, tractors, and trailers under lease, rental, and/or maintenance contracts, and provides innovative transportation, supply chain, and technology solutions to its customers. Retail Automotive. We are one of the largest global automotive retailers as measured by the $23.7 billion in total retail automotive dealership revenue we generated in 2022. We are diversified geographically with 54% of our total retail automotive dealership revenues in the six months ended June 30, 2023, generated in the U.S. and Puerto Rico and 46% generated outside of the U.S. We offer over 35 vehicle brands with 71% of our retail automotive franchised dealership revenue generated from premium brands, such as Audi, BMW, Land Rover, Mercedes-Benz, and Porsche, in the six months ended June 30, 2023. As of June 30, 2023, we operated 337 retail automotive franchised dealerships, of which 148 are located in the U.S. and 189 are located outside of the U.S. The franchised dealerships outside of the U.S. are located primarily in the U.K. As of June 30, 2023, we also operated 20 used vehicle dealerships, with seven dealerships in the U.S. and 13 dealerships in the U.K., which retailed used vehicles under a one price, "no-haggle" methodology under the CarShop brand. Each of our franchised dealerships offers a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, we generate higher-margin revenue at each of our dealerships through maintenance and repair services, the sale and placement of third-party finance and insurance products, third-party extended service and maintenance contracts, replacement and aftermarket automotive products, and at certain of our locations, collision repair services. We operate our franchised dealerships under franchise agreements with a number of automotive manufacturers and distributors that are subject to certain rights and restrictions typical of the industry. Beginning in 2023, we transitioned our Mercedes-Benz U.K. dealerships to an agency model under which these dealerships receive a fee for facilitating the sale by the manufacturer of a new vehicle but do not hold the vehicle in inventory. Vehicles sold under this agency model are counted as new agency units sold instead of new retail units sold by us, and only the fee we receive from the manufacturer, not the price of the vehicle, is reported as new revenue (as opposed to previously recording all of the vehicle sale price as new revenue) with no corresponding cost of sale. We continue to provide new vehicle customer service at our Mercedes-Benz U.K. dealerships, and the Mercedes-Benz U.K. agency model at this time has not changed our used vehicle sales operations or service and parts operations, although the long-term impact of the agency model at these dealerships as well as other agency models proposed by our manufacturer partners is uncertain. During the six months ended June 30, 2023, we closed four locations in the U.S., consisting of three retail automotive franchises and one CarShop location. Retail Commercial Truck Dealership. We operate Premier Truck Group ("PTG"), a heavy- and medium-duty truck dealership group offering primarily Freightliner and Western Star trucks (both Daimler brands), with locations across nine U.S. states and the Canadian provinces of Ontario and Manitoba. In June 2023, we acquired Transolutions Truck Centres ("TSTC"), a retailer of heavy- and medium-duty commercial trucks and buses across the greater Winnipeg, Manitoba market, adding three full-service dealerships and two service and parts centers to PTG’s operations. As of June 30, 2023, PTG operated 44 locations selling new and/or used trucks, performing service and parts operations, or offering collision repair services. Penske Australia. Penske Australia is the exclusive importer and distributor of Western Star heavy-duty trucks (a Daimler brand), MAN heavy- and medium-duty trucks and buses (a VW Group brand), and Dennis Eagle refuse collection vehicles, together with associated parts, across Australia, New Zealand, and portions of the Pacific. In most of these same markets, we are also a leading distributor of diesel and gas engines and power systems, principally representing MTU (a Rolls-Royce solution), Detroit Diesel, Allison Transmission, and Bergen Engines. Penske Australia offers products across the on- and off-highway markets, including in the trucking, mining, power generation, defense, marine, rail, and construction sectors and supports full parts and aftersales service through a network of branches, field service locations, and dealers across the region. Penske Transportation Solutions. We hold a 28.9% ownership interest in Penske Truck Leasing Co., L.P. ("PTL"). PTL is owned 41.1% by Penske Corporation, 28.9% by us, and 30.0% by Mitsui & Co., Ltd. ("Mitsui"). We account for our investment in PTL under the equity method, and we therefore record our share of PTL's earnings on our statements of income under the caption "Equity in earnings of affiliates," which also includes the results of our other equity method investments. Penske Transportation Solutions ("PTS") is the universal brand name for PTL's various business lines through which it is capable of meeting customers' needs across the supply chain with a broad product offering that includes full-service truck leasing, truck rental, and contract maintenance along with logistic services, such as dedicated contract carriage, distribution center management, freight management, and dry van truckload carrier services. Basis of Presentation The accompanying unaudited consolidated condensed financial statements of PAG have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022 is unaudited but includes all adjustments which our management believes to be necessary for the fair presentation of results for the periods presented. Results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with our audited financial statements for the year ended December 31, 2022, which are included as part of our Annual Report on Form 10-K. Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets, leases, and certain reserves. Fair Value of Financial Instruments Accounting standards define fair value as the price that would be received from selling an asset, or paid to transfer a liability in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. Accounting standards establish a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value and also establishes the following three levels of inputs that may be used to measure fair value:
Our financial instruments consist of cash and cash equivalents, debt, floor plan notes payable, and forward exchange contracts used to hedge future cash flows. Other than our fixed rate debt, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. Our fixed rate debt consists of amounts outstanding under our senior subordinated notes and mortgage facilities. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 2), and we estimate the fair value of our mortgage facilities using a present value technique based on our current market interest rates for similar types of financial instruments (Level 2). A summary of our fixed rate debt is as follows:
Disposals The results of operations for disposals are included within net income unless they meet the criteria to be classified as held for sale and treated as discontinued operations. Income Taxes Tax regulations may require items to be included in our tax return at different times than when those items are reflected in our financial statements. Some of the differences are permanent, such as expenses that are not deductible on our tax return, and some are temporary differences, such as the timing of depreciation expense. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that will be used as a tax deduction or credit in our tax return in future years which we have already recorded in our financial statements. Deferred tax liabilities generally represent deductions taken on our tax return that have not yet been recognized as an expense in our financial statements. We establish valuation allowances for our deferred tax assets if the amount of expected future taxable income is not more likely than not to allow for the use of the deduction or credit. Recent Accounting Pronouncements Reference Rate Reform In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting." This ASU provides optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued due to reference rate reform. Additionally, entities can elect to continue applying hedge accounting for hedging relationships affected by reference rate reform if certain conditions are met. In January 2021, the FASB issued ASU 2021-01, "Reference Rate Reform (Topic 848): Scope." This ASU refines the scope of ASC 848 and clarifies some of its guidance as part of the Board's monitoring of global reference rate reform activities. The ASU permits entities to elect certain optional expedients and exceptions when accounting for derivative contracts and certain hedging relationships affected by changes in the interest rates used for discounting cash flows, for computing variation margin settlements, and for calculating price alignment interest in connection with reference rate reform activities. In December 2022, the FASB issued ASU 2022-06, "Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848." This ASU defers the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. These new standards were effective upon issuance and generally can be applied to applicable contract modifications. While some of our floorplan arrangements and certain credit agreements had historically used LIBOR as a benchmark for calculating the applicable interest rate, all of our agreements previously utilizing LIBOR have transitioned to an alternative benchmark rate on or before July 1, 2023. These changes have not had a significant impact on our consolidated financial position, results of operations, and cash flows.
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Revenues |
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Revenues | Revenues Automotive and commercial truck dealerships generate the majority of our revenues. New and used vehicle revenues typically include sales to retail customers, to fleet customers, and to leasing companies providing consumer leasing. We generate finance and insurance revenues from sales of third-party extended service contracts, sales of third-party insurance policies, commissions relating to the sale of finance and lease contracts to third parties, and the sales of certain other products. Service and parts revenues include fees paid by customers for repair, maintenance and collision services, and the sale of replacement parts and other aftermarket accessories as well as warranty repairs that are reimbursed directly by various vehicle manufacturers. Revenues are recognized upon satisfaction of our performance obligations under contracts with our customers and are measured at the amount of consideration we expect to be entitled to in exchange for transferring goods or providing services. A discussion of revenue recognition by reportable segment is included below. Retail Automotive and Retail Commercial Truck Dealership Revenue Recognition Dealership Vehicle Sales. We record revenue for vehicle sales at a point in time when vehicles are delivered, which is when the transfer of title, risks and rewards of ownership, and control are considered passed to the customer. For dealerships operating under a franchise model, the amount of consideration we receive for vehicle sales is stated within the executed contract with our customer and is reduced by any non-cash consideration representing the fair value of trade-in vehicles, if applicable. Payment is typically due and collected within 30 days subsequent to transfer of control of the vehicle. For dealerships operating under an agency model, we receive a commission for each vehicle sale that we facilitate under the terms of the agency agreement with the manufacturer, which is recorded as new vehicle revenue. Dealership Parts and Service Sales. We record revenue for vehicle service and collision work over time as work is completed and when parts are delivered to our customers. For service and parts revenues recorded over time, we utilize a method that considers total costs incurred to date and the applicable margin in relation to total expected efforts to complete our performance obligation in order to determine the appropriate amount of revenue to recognize over time. Recognition of this revenue over time reflects the amount of consideration we expect to be entitled to for the transfer of goods and services performed to date, representative of the amount for which we have a right to payment. The amount of consideration we receive for parts and service sales, including collision repair work, is based upon labor hours expended and parts utilized to perform and complete the necessary services to our customers. Payment is typically due upon delivery or within a period of time shortly thereafter. We receive payment from our customers upon transfer of control or within a period typically less than 30 days subsequent to the completion of services for the customer. We allow for customer returns of parts sales up to 30 days after the sale; however, parts returns are not material. Dealership Finance and Insurance Sales. Subsequent to the sale of a vehicle to a customer, we sell installment sale contracts to various financial institutions on a non-recourse basis (with specified exceptions) to mitigate the risk of default. We receive a commission from the lender equal to either the difference between the interest rate charged to the customer and the interest rate set by the financing institution or a flat fee. We also receive commissions for facilitating the sale of various products to customers, including voluntary vehicle protection insurance, vehicle theft protection, and extended service contracts. These commissions are recorded as revenue at a point in time when the customer enters into the contract. Payment is typically due and collected within 30 days subsequent to the execution of the contract with the customer. In the case of finance contracts, a customer may prepay or fail to pay their contract, thereby terminating the contract. Customers may also terminate extended service contracts and other insurance products, which are fully paid at purchase, and become eligible for refunds of unused premiums. In these circumstances, a portion of the commissions we received may be charged back based on the terms of the contracts. The revenue we record relating to these transactions is net of an estimate of the amount of chargebacks we will be required to pay. Our estimate is based upon our historical experience with similar contracts, including the impact of refinance and default rates on retail finance contracts and cancellation rates on extended service contracts and other insurance products. Aggregate reserves relating to chargeback activity were $40.8 million and $38.4 million as of June 30, 2023, and December 31, 2022, respectively. Commercial Vehicle Distribution and Other Revenue Recognition Penske Australia. We record revenue from the distribution of vehicles and other products at a point in time when delivered, which is when the transfer of title, risks and rewards of ownership, and control are considered passed to the customer. We record revenue for service or repair work over time as work is completed and when parts are delivered to our customers. For service and parts revenues recorded over time, we utilize a method that considers total costs incurred to date and the applicable margin in relation to total expected efforts to complete our performance obligation in order to determine the appropriate amount of revenue to recognize over time. Recognition of this revenue over time reflects the amount of consideration we expect to be entitled to for the transfer of goods and services performed to date, representative of the amount for which we have a right to payment. The amount of consideration we receive for vehicle and product sales is stated within the executed contract with our customer. The amount of consideration we receive for parts and service sales is based upon labor hours expended and parts utilized to perform and complete the necessary services to our customers. Payment is typically due upon delivery, upon invoice, or within a period of time shortly thereafter. We receive payment from our customers upon transfer of control or within a period typically less than 30 days subsequent to transfer of control or invoice. We record revenue from the distribution of engines and other products at a point in time when delivered, which is when the transfer of title, risks and rewards of ownership, and control are considered passed to the customer. We record revenue for service or repair work over time as work is completed and when parts are delivered to our customers. For service and parts revenues recorded over time, we utilize a method that considers total costs incurred to date and the applicable margin in relation to total expected efforts to complete our performance obligation in order to determine the appropriate amount of revenue to recognize over time. Recognition of revenue over time reflects the amount of consideration we expect to be entitled to for the transfer of goods and services performed to date, representative of the amount for which we have a right to payment. For our long-term power generation contracts, we record revenue over time as services are provided in accordance with contract milestones, which is considered an output method that requires judgment to determine our progress towards contract completion and the corresponding amount of revenue to recognize. Any revisions to estimates related to revenues or costs to complete contracts are recorded in the period in which the revisions to estimates are identified and the amounts can be reasonably estimated. The amount of consideration we receive for engine, product, and power generation sales is stated within the executed contract with our customer. The amount of consideration we receive for service sales is based upon labor hours expended and parts utilized to perform and complete the necessary services to our customers. Payment is typically due upon delivery, upon invoice, or within a period of time shortly thereafter. We receive payment from our customers upon transfer of control or within a period typically less than 30 days subsequent to transfer of control or invoice. Retail Automotive Dealership The following tables disaggregate our retail automotive segment revenue by product type and geographic location for the three and six months ended June 30, 2023 and 2022:
Retail Commercial Truck Dealership The following table disaggregates our retail commercial truck segment revenue by product type for the three and six months ended June 30, 2023 and 2022:
Commercial Vehicle Distribution and Other Our other reportable segment relates to our Penske Australia business. Commercial vehicle distribution and other revenue was $143.3 million and $286.9 million, including $68.0 million and $129.3 million of service and parts revenue, during the three and six months ended June 30, 2023, and $140.9 million and $294.8 million, including $60.5 million and $115.6 million of service and parts revenue, during the three and six months ended June 30, 2022, respectively.Contract Balances The following table summarizes our accounts receivable and unearned revenues as of June 30, 2023, and December 31, 2022:
Contracts in transit represent receivables from unaffiliated finance companies relating to the sale of customers' installment sales and lease contracts arising in connection with the sale of a vehicle by us. Vehicle receivables represent receivables for any portion of the vehicle sales price not paid by the finance company. Manufacturer receivables represent amounts due from manufacturers, including incentives, holdbacks, rebates, warranty claims, and other receivables due from the factory. Trade receivables represent receivables due from customers, including amounts due for parts and service sales as well as receivables due from finance companies and others for the commissions earned on financing and commissions earned on insurance and extended service products provided by third parties. We evaluate collectability of receivables and estimate an allowance for doubtful accounts based on the age of the receivable, contractual life, historical collection experience, current conditions, and forecasts of future economic conditions, which is recorded within "Accounts receivable" on our consolidated balance sheets with our receivables presented net of the allowance. Unearned revenues primarily relate to payments received from customers prior to satisfaction of our performance obligations, such as refundable customer deposits, non-refundable customer deposits, and deferred revenues from operating leases. These amounts are presented within "Accrued expenses and other current liabilities" on our consolidated balance sheets. Of the amounts recorded as unearned revenues as of December 31, 2022, $168.8 million was recognized as revenue during the six months ended June 30, 2023. Additional Revenue Recognition Related Policies We do not have any material significant payment terms associated with contracts with our customers. Payment is due and collected as previously detailed for each reportable segment. We do not offer material rights of return or service-type warranties. Taxes collected from customers and remitted to governmental authorities are recorded on a net basis (excluded from revenue). Shipping costs incurred subsequent to transfer of control to our customers are recognized as cost of sales. Sales promotions that we offer to customers are accounted for as a reduction of revenues at the time of sale.
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases We lease land and facilities, including certain dealerships and office space. Our property leases are generally for an initial period between 5 and 20 years and are typically structured to include renewal options at our election. We include renewal options that we are reasonably certain to exercise in the measurement of our lease liabilities and right-of-use assets. We also have equipment leases that primarily relate to office and computer equipment, service and shop equipment, company vehicles, and other miscellaneous items. These leases are generally for a period of less than 5 years. We do not have any material leases, individually or in the aggregate, classified as a finance leasing arrangement. We estimate the total undiscounted rent obligations under these leases, including any extension periods that we are reasonably certain to exercise, to be $5.2 billion as of June 30, 2023. Some of our lease arrangements include rental payments that are adjusted based on an index or rate, such as the Consumer Price Index (CPI). As the rate implicit in the lease is generally not readily determinable for our operating leases, the discount rates used to determine the present value of our lease liability are based on our incremental borrowing rate at the lease commencement date and commensurate with the remaining lease term. Our incremental borrowing rate for a lease is the rate of interest we would have to pay to borrow on a collateralized basis over a similar term for an amount equal to the lease payments in a similar economic environment. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Pursuant to the leases for some of our larger facilities, we are required to comply with specified financial ratios, including a "rent coverage" ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require us to post collateral in the form of a letter of credit. A breach of the other lease covenants gives rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. In connection with the sale, relocation, and closure of certain of our dealerships, we have entered into a number of third-party sublease agreements. The rent paid by our sub-tenants on such properties was $4.3 million and $8.5 million for the three and six months ended June 30, 2023, and $4.6 million and $9.7 million for the three and six months ended June 30, 2022, respectively. We have in the past and may in the future enter into sale-leaseback transactions to finance certain property acquisitions and capital expenditures, pursuant to which we sell property to third parties and agree to lease those assets back for a certain period of time. Such sales generate proceeds that vary from period to period. We do not have any material leases that have not yet commenced as of June 30, 2023.The following table summarizes our net operating lease cost during the three and six months ended June 30, 2023 and 2022:
The following table summarizes supplemental cash flow information related to our operating leases:
Supplemental balance sheet information related to the weighted average remaining lease term and discount rate of our leases is as follows:
The following table summarizes the maturity of our lease liabilities on an undiscounted cash flow basis and a reconciliation to the operating lease liabilities recognized on our consolidated condensed balance sheet as of June 30, 2023:
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Inventories |
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Inventories | Inventories Inventories consisted of the following:
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Business Combinations |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations | Business Combinations During the six months ended June 30, 2023, we acquired Transolutions Truck Centres, a retailer of heavy- and medium-duty commercial trucks and buses across the greater Winnipeg, Manitoba market, adding three full-service dealerships and two service and parts centers to PTG’s operations. During the six months ended June 30, 2022, we acquired TEAM Truck Centres, a retailer of heavy- and medium-duty Freightliner and Western Star commercial trucks located in Ontario, Canada representing four full-service dealerships. During the six months ended June 30, 2022, we also acquired ten retail automotive franchises, consisting of six franchises in the U.K. and four franchises in the U.S. Our financial statements include the results of operations of the acquired entity from the date of acquisition. The fair value of the assets acquired and liabilities assumed have been recorded in our consolidated condensed financial statements and may be subject to adjustment pending completion of final valuation. The following table summarizes the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed for the six months ended June 30, 2023 and 2022:
Our following unaudited consolidated pro forma results of operations for the three and six months ended June 30, 2023 and 2022 give effect to acquisitions consummated during 2023 and 2022 as if they had occurred effective at the beginning of the period:
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Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets | Intangible Assets Following is a summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets during the six months ended June 30, 2023:
As of June 30, 2023, the goodwill balance within our Retail Automotive, Retail Commercial Truck, and Other reportable segments was $1,641.4 million, $494.2 million, and $73.3 million, respectively. There is no goodwill recorded in our Non-Automotive Investments reportable segment.
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Vehicle Financing |
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Jun. 30, 2023 | |
Short-Term Debt [Abstract] | |
Vehicle Financing | Vehicle Financing We finance substantially all of the commercial vehicles we purchase for distribution, new vehicles for retail sale, and a portion of our used vehicle inventories for retail sale under floor plan and other revolving arrangements with various lenders, including the captive finance companies associated with automotive manufacturers. In the U.S., the floor plan arrangements are due on demand; however, we have not historically been required to repay floor plan advances prior to the sale of the vehicles that have been financed. We typically make monthly interest payments on the amount financed. Outside of the U.S., substantially all of the floor plan arrangements are payable on demand or have an original maturity of 90 days or less, and we are generally required to repay floor plan advances at the earlier of the sale of the vehicles that have been financed or the stated maturity. The agreements typically grant a security interest in substantially all of the assets of our dealership and distribution subsidiaries and in the U.S., Australia, and New Zealand are guaranteed or partially guaranteed by us. Interest rates under the arrangements are variable and increase or decrease based on changes in the prime rate, the Secured Overnight Financing Rate ("SOFR"), the Sterling Overnight Index Average ("SONIA"), the Bank of England Base Rate, the Finance House Base Rate, the Euro Interbank Offered Rate, the Canadian Prime Rate, the Tokyo Interbank Offered Rate, the Australian Bank Bill Swap Rate, or the New Zealand Bank Bill Benchmark Rate. To date, we have not experienced any material limitation with respect to the amount or availability of financing from any institution providing us with vehicle financing. We also receive non-refundable credits from certain of our vehicle manufacturers, which are treated as a reduction of cost of sales as vehicles are sold. The weighted average interest rate on floor plan borrowings was 4.2% and 1.3% for the six months ended June 30, 2023 and 2022, respectively. We classify floor plan notes payable to a party other than the manufacturer of a particular new vehicle and all floor plan notes payable relating to pre-owned vehicles as "Floor plan notes payable — non-trade" on our consolidated balance sheets and classify related cash flows as a financing activity on our consolidated statements of cash flows.
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Earnings Per Share |
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Earnings Per Share | Earnings Per ShareBasic earnings per share is computed by dividing net income attributable to common stockholders by the number of weighted average shares of voting common stock outstanding, including unvested restricted stock awards which contain rights to non-forfeitable dividends. Diluted earnings per share is computed by dividing net income attributable to common stockholders by the number of weighted average shares of voting common stock outstanding, adjusted for the dilutive impact of unissued shares paid to directors as compensation. A reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three and six months ended June 30, 2023 and 2022 follows:
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Long-Term Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Term Debt | Long-Term Debt Long-term debt consisted of the following:
U.S. Credit Agreement On April 20, 2023, we entered into the Tenth Amendment (the “Amendment”) to our U.S. credit agreement with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, which added as a lender Daimler Truck Financial Services USA LLC (the credit agreement as amended, the “U.S. Credit Agreement”). The U.S. Credit Agreement provides for up to $1.2 billion in revolving loans for working capital, acquisitions, capital expenditures, investments, and other general corporate purposes and provides up to an additional $75 million of letters of credit. The U.S. Credit Agreement provides for a maximum of $400 million of borrowings for foreign acquisitions and expires on September 30, 2025. The interest rate on revolving loans is based on an adjusted Secured Overnight Financing Rate plus 1.50%, with uncollateralized borrowings in excess of a defined borrowing base bearing interest at adjusted SOFR plus 3.00%. The U.S. credit agreement is fully and unconditionally guaranteed on a joint and several basis by substantially all of our U.S. subsidiaries and contains a number of significant operating covenants that, among other things, restrict our ability to dispose of assets, incur additional indebtedness, repay certain other indebtedness, pay dividends, create liens on assets, make investments or acquisitions, and engage in mergers or consolidations. We are also required to comply with specified financial and other tests and ratios, each as defined in the U.S. credit agreement, including a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders' equity, and a ratio of debt to earnings before interest, taxes, depreciation, and amortization ("EBITDA"). A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of the amounts owed. The U.S. credit agreement also contains typical events of default, including change of control, non-payment of obligations, and cross-defaults to our other material indebtedness. Substantially all of our U.S. assets are subject to security interests granted to the lenders under the U.S. credit agreement. As of June 30, 2023, we had no revolver borrowings under the U.S. credit agreement. U.K. Credit Agreement Our subsidiaries in the U.K. (the "U.K. subsidiaries") are party to a £200.0 million revolving credit agreement with the National Westminster Bank plc and BMW Financial Services (GB) Limited (the "U.K. credit agreement") to be used for working capital, acquisitions, capital expenditures, investments, and general corporate purposes. This facility expires in January 2027 (with an option to extend the term to January 2028 as described below). The revolving loans bear interest between SONIA plus 1.10% and SONIA plus 2.10%. In addition, the U.K. credit agreement includes a £100.0 million "accordion" feature which allows the U.K. subsidiaries to request up to an additional £100.0 million of facility capacity, subject to certain limitations. The lenders may agree to provide additional capacity, and, if not, the U.K. subsidiaries may add an additional lender, if available, to the facility to provide such additional capacity. The U.K. subsidiaries may request an extension of the term of the U.K. credit agreement by an additional year by providing notice beginning in December 2023, with the effectiveness of such extension subject to lender approval. As of June 30, 2023, we had no borrowings under the U.K. credit agreement. The U.K. credit agreement is fully and unconditionally guaranteed on a joint and several basis by our U.K. subsidiaries and contains a number of significant covenants that, among other things, limit the ability of our U.K. subsidiaries to pay dividends, dispose of assets, incur additional indebtedness, repay other indebtedness, create liens on assets, make investments or acquisitions, and engage in mergers or consolidations. In addition, our U.K. subsidiaries are required to comply with defined ratios and tests, including a ratio of earnings before interest, taxes, amortization, and rental payments ("EBITAR") to interest plus rental payments, a measurement of maximum capital expenditures, and a debt to EBITDA ratio. A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. The U.K. credit agreement also contains typical events of default, including change of control and non-payment of obligations and cross-defaults to other material indebtedness of our U.K. subsidiaries. Substantially all of our U.K. subsidiaries' assets are subject to security interests granted to the lenders under the U.K. credit agreement. Senior Subordinated Notes We have issued the following senior subordinated notes:
Each of these notes are our unsecured, senior subordinated obligations and are guaranteed on an unsecured senior subordinated basis by our 100% owned U.S. subsidiaries. Each also contain customary negative covenants and events of default. If we experience certain "change of control" events specified in the indentures, holders of these notes will have the option to require us to purchase for cash all or a portion of their notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest. In addition, if we make certain asset sales and do not reinvest the proceeds thereof or use such proceeds to repay certain debt, we will be required to use the proceeds of such asset sales to make an offer to purchase the notes at a price equal to 100% of the principal amount of the notes, plus accrued and unpaid interest. Optional redemption. We may redeem the 3.50% Notes at the redemption prices noted in the indenture. Prior to June 15, 2024, we may redeem the 3.75% Notes at a redemption price equal to 100% of the principal thereof, plus an applicable make-whole premium, and any accrued and unpaid interest. In addition, we may redeem up to 40% of the Notes before June 15, 2024, with net cash proceeds from certain equity offerings at a redemption price equal to 103.750% of the principal thereof, plus accrued and unpaid interest. We may redeem the 3.75% Notes on or after June 15, 2024, at the redemption prices specified in the indenture. Canada Credit Agreement On May 25, 2023, we increased the borrowing availability under our Canadian revolving line of credit with Daimler Truck Financial Services Canada Corporation ("DTFS") to CAD $150.0 million (the "Canada credit agreement"). The Canada credit agreement bears interest at a rate of Canadian Prime (determined by the Royal Bank of Canada) ("Canadian Prime Rate") minus 0.50%; provided that DTFS is entitled to demand repayment of any outstanding borrowings under the Canada revolving note and, following such demand, the interest rate on outstanding borrowings shall be increased to the Canadian Prime Rate plus 2.00%. The Canada credit agreement is guaranteed by the holding company of a majority of our international subsidiaries. As of June 30, 2023, we had CAD $70.5 million ($53.2 million) outstanding borrowings under the Canada credit agreement. Australia Loan Agreements Penske Australia is party to an AU $75.0 million credit agreement with Daimler Truck Financial Services Australia Pty Ltd (the "Australia credit agreement"). The Australia credit agreement provides the lender with a secured interest in all assets of these businesses, is terminable with six months' notice, and carries an interest rate of Australian BBSW 30-day Bill Rate plus 2.29%. As of June 30, 2023, we had AU $36.2 million ($24.1 million) outstanding borrowings under the Australia credit agreement. Mortgage Facilities We are party to mortgages that bear interest at defined rates and require monthly principal and interest payments. We also have a revolving mortgage facility with Toyota Motor Credit Corporation with a maximum borrowing capacity of $300.0 million contingent on property values and a borrowing capacity as of June 30, 2023, of $251.2 million. The facility bears interest at the prime rate minus 1.68% and expires in December 2025. As of June 30, 2023, we had $176.8 million outstanding borrowings under this mortgage facility. Our mortgage facilities also contain typical events of default, including non-payment of obligations, cross-defaults to our other material indebtedness, certain change of control events, and the loss or sale of certain dealerships operated at the properties. Substantially all of the buildings and improvements on the properties financed pursuant to the mortgage facilities are subject to security interests granted to the lender. As of June 30, 2023, we owed $585.6 million of principal under all of our mortgage facilities.
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Commitments and Contingent Liabilities |
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Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingent Liabilities | Commitments and Contingent Liabilities We are involved in litigation which may relate to claims brought by governmental authorities, issues with customers, and employment related matters, including class action claims and purported class action claims. As of June 30, 2023, we were not party to any legal proceedings, including class action lawsuits that, individually or in the aggregate, are reasonably expected to have a material adverse effect on our results of operations, financial condition, or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our results of operations, financial condition, or cash flows. We lease land and facilities, including certain dealerships and office space. Pursuant to the leases for some of our larger facilities, we are required to comply with specified financial ratios, including a "rent coverage" ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require us to post collateral in the form of a letter of credit. A breach of the other lease covenants gives rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. Refer to the disclosures provided in Note 3 for further description of our leases. We have sold a number of dealerships to third parties and as a condition to certain of those sales, remain liable for the lease payments relating to the properties on which those businesses operate in the event of non-payment by the buyer. We are also party to lease agreements on properties that we no longer use in our retail operations that we have sublet to third parties. We rely on subtenants to pay the rent and maintain the property at these locations. In the event the subtenant does not perform as expected, we may not be able to recover amounts owed to us, and we could be required to fulfill these obligations. We believe we have made appropriate reserves relating to these locations. Our floor plan credit agreements with Mercedes-Benz Financial Services Australia and Mercedes-Benz Financial Services New Zealand ("MBA") provide us revolving loans for the acquisition of commercial vehicles for distribution to our retail network. These facilities include a commitment to repurchase dealer vehicles in the event the dealer's floor plan agreement with MBA is terminated. We have $26.1 million of letters of credit outstanding and $13.0 million of bank guarantees as of June 30, 2023, and have posted $21.6 million of surety bonds in the ordinary course of business.
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Equity |
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Jun. 30, 2023 | |
Equity [Abstract] | |
Equity | EquityDuring the three months ended June 30, 2023, we repurchased 1,551,058 shares of our common stock for $217.8 million, or an average of $140.44 per share, under our securities repurchase program approved by our Board of Directors. During the six months ended June 30, 2023, we repurchased 2,441,385 shares of our outstanding common stock for $328.0 million, or an average of $134.36 per share, under this program. In May 2023, our Board of Directors delegated to management an additional $250 million in authority to repurchase our outstanding securities, of which $246.3 million remained outstanding as of June 30, 2023. During the six months ended June 30, 2023, we also acquired 162,174 shares of our common stock for $22.4 million, or an average of $138.43 per share, from employees in connection with a net share settlement feature of employee equity awards. |
Accumulated Other Comprehensive Income (Loss) |
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Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss) by component and the reclassifications out of accumulated other comprehensive income (loss) during the three and six months ended June 30, 2023 and 2022, respectively, attributable to Penske Automotive Group common stockholders follows: Three Months Ended June 30, 2023
Three Months Ended June 30, 2022
Six Months Ended June 30, 2023
Six Months Ended June 30, 2022
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information Our operations are organized by management into operating segments by line of business and geography. We have determined that we have four reportable segments as defined in generally accepted accounting principles for segment reporting: (i) Retail Automotive, consisting of our retail automotive dealership operations; (ii) Retail Commercial Truck, consisting of our retail commercial truck dealership operations in the U.S. and Canada; (iii) Other, consisting of our commercial vehicle and power systems distribution operations; and (iv) Non-Automotive Investments, consisting of our equity method investments in non-automotive operations which includes our investment in PTS and other various investments. The Retail Automotive reportable segment includes all automotive dealerships and all departments relevant to the operation of the dealerships and our retail automotive joint ventures. The individual dealership operations included in the Retail Automotive reportable segment represent six operating segments: Eastern, Central, and Western United States, Used Vehicle Dealerships United States, International, and Used Vehicle Dealerships International. These operating segments have been aggregated into one reportable segment as their operations (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and/or used vehicles, service, parts, and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals), and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions). Revenue and segment income for the three and six months ended June 30, 2023 and 2022 follows: Three Months Ended June 30,
Six Months Ended June 30,
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Pay vs Performance Disclosure - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
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Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 300.8 | $ 374.0 | $ 599.1 | $ 741.9 |
Insider Trading Arrangements |
3 Months Ended |
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Jun. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Interim Financial Statements (Policies) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated condensed financial statements of PAG have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022 is unaudited but includes all adjustments which our management believes to be necessary for the fair presentation of results for the periods presented. Results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with our audited financial statements for the year ended December 31, 2022, which are included as part of our Annual Report on Form 10-K.
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Estimates | Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets, leases, and certain reserves.
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Fair Value of Financial Instruments | Fair Value of Financial Instruments Accounting standards define fair value as the price that would be received from selling an asset, or paid to transfer a liability in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants at the measurement date. Accounting standards establish a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value and also establishes the following three levels of inputs that may be used to measure fair value:
Our financial instruments consist of cash and cash equivalents, debt, floor plan notes payable, and forward exchange contracts used to hedge future cash flows. Other than our fixed rate debt, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting.Our fixed rate debt consists of amounts outstanding under our senior subordinated notes and mortgage facilities. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 2), and we estimate the fair value of our mortgage facilities using a present value technique based on our current market interest rates for similar types of financial instruments (Level 2).
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Disposals | Disposals The results of operations for disposals are included within net income unless they meet the criteria to be classified as held for sale and treated as discontinued operations.
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Income Taxes | Income Taxes Tax regulations may require items to be included in our tax return at different times than when those items are reflected in our financial statements. Some of the differences are permanent, such as expenses that are not deductible on our tax return, and some are temporary differences, such as the timing of depreciation expense. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that will be used as a tax deduction or credit in our tax return in future years which we have already recorded in our financial statements. Deferred tax liabilities generally represent deductions taken on our tax return that have not yet been recognized as an expense in our financial statements. We establish valuation allowances for our deferred tax assets if the amount of expected future taxable income is not more likely than not to allow for the use of the deduction or credit.
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Recent Accounting Pronouncements | Recent Accounting Pronouncements Reference Rate Reform In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting." This ASU provides optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued due to reference rate reform. Additionally, entities can elect to continue applying hedge accounting for hedging relationships affected by reference rate reform if certain conditions are met. In January 2021, the FASB issued ASU 2021-01, "Reference Rate Reform (Topic 848): Scope." This ASU refines the scope of ASC 848 and clarifies some of its guidance as part of the Board's monitoring of global reference rate reform activities. The ASU permits entities to elect certain optional expedients and exceptions when accounting for derivative contracts and certain hedging relationships affected by changes in the interest rates used for discounting cash flows, for computing variation margin settlements, and for calculating price alignment interest in connection with reference rate reform activities. In December 2022, the FASB issued ASU 2022-06, "Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848." This ASU defers the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. These new standards were effective upon issuance and generally can be applied to applicable contract modifications. While some of our floorplan arrangements and certain credit agreements had historically used LIBOR as a benchmark for calculating the applicable interest rate, all of our agreements previously utilizing LIBOR have transitioned to an alternative benchmark rate on or before July 1, 2023. These changes have not had a significant impact on our consolidated financial position, results of operations, and cash flows.
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Interim Financial Statements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of carrying values and fair values of senior subordinated notes and fixed rate mortgage facilities | A summary of our fixed rate debt is as follows:
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Revenues (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accounts receivable and unearned revenues | The following table summarizes our accounts receivable and unearned revenues as of June 30, 2023, and December 31, 2022:
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Retail automotive dealership | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of disaggregation of revenues | The following tables disaggregate our retail automotive segment revenue by product type and geographic location for the three and six months ended June 30, 2023 and 2022:
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Retail commercial truck dealership | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of disaggregation of revenues | The following table disaggregates our retail commercial truck segment revenue by product type for the three and six months ended June 30, 2023 and 2022:
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Leases (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of net operating lease cost | The following table summarizes our net operating lease cost during the three and six months ended June 30, 2023 and 2022:
The following table summarizes supplemental cash flow information related to our operating leases:
Supplemental balance sheet information related to the weighted average remaining lease term and discount rate of our leases is as follows:
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Schedule of maturity of lease liabilities | The following table summarizes the maturity of our lease liabilities on an undiscounted cash flow basis and a reconciliation to the operating lease liabilities recognized on our consolidated condensed balance sheet as of June 30, 2023:
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Inventories (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories consisted of the following:
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Business Combinations (Tables) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed | The following table summarizes the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed for the six months ended June 30, 2023 and 2022:
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Summary of unaudited consolidated pro forma results of operations | Our following unaudited consolidated pro forma results of operations for the three and six months ended June 30, 2023 and 2022 give effect to acquisitions consummated during 2023 and 2022 as if they had occurred effective at the beginning of the period:
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Intangible Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets | Following is a summary of the changes in the carrying amount of goodwill and other indefinite-lived intangible assets during the six months ended June 30, 2023:
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Earnings Per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of number of shares used in calculation of basic and diluted earning per share | A reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three and six months ended June 30, 2023 and 2022 follows:
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Long-Term Debt (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of long-term debt | Long-term debt consisted of the following:
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Schedule of senior subordinated notes issuances | We have issued the following senior subordinated notes:
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Accumulated Other Comprehensive Income (Loss) (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of the changes in accumulated other comprehensive income/(loss) by component and the reclassifications out of accumulated other comprehensive income/(loss) attributable to the entity's common stockholders | Changes in accumulated other comprehensive income (loss) by component and the reclassifications out of accumulated other comprehensive income (loss) during the three and six months ended June 30, 2023 and 2022, respectively, attributable to Penske Automotive Group common stockholders follows: Three Months Ended June 30, 2023
Three Months Ended June 30, 2022
Six Months Ended June 30, 2023
Six Months Ended June 30, 2022
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Segment Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues and segment income by reportable segment | Revenue and segment income for the three and six months ended June 30, 2023 and 2022 follows: Three Months Ended June 30,
Six Months Ended June 30,
|
Interim Financial Statements - Fair Value, Assets Held For Sale, Discontinued Operations (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Carrying Value | $ 1,743.7 | $ 1,622.1 |
3.50% senior subordinated notes due 2025 | ||
Debt Instrument [Line Items] | ||
Interest rate | 3.50% | |
Carrying Value | $ 546.9 | 546.2 |
Fair Value | $ 520.9 | 508.7 |
3.75% senior subordinated notes due 2029 | ||
Debt Instrument [Line Items] | ||
Interest rate | 3.75% | |
Carrying Value | $ 495.4 | 495.1 |
Fair Value | 428.0 | 404.2 |
Mortgage facilities | ||
Debt Instrument [Line Items] | ||
Carrying Value | 585.6 | 494.3 |
Fair Value | $ 555.1 | $ 462.1 |
Revenues - Other Disclosures (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Revenues | |||||
Total revenues | $ 7,468.5 | $ 6,906.9 | $ 14,807.5 | $ 13,882.3 | |
Commercial vehicle distribution and other | |||||
Revenues | |||||
Payment period | 30 days | ||||
Total revenues | 143.3 | 140.9 | $ 286.9 | 294.8 | |
Vehicle Sales | Retail Automotive and Retail Commercial Truck Dealership | |||||
Revenues | |||||
Payment period | 30 days | ||||
Service and parts | Retail Automotive and Retail Commercial Truck Dealership | |||||
Revenues | |||||
Payment period | 30 days | ||||
Service and parts | Commercial vehicle distribution and other | |||||
Revenues | |||||
Total revenues | 68.0 | $ 60.5 | $ 129.3 | $ 115.6 | |
Finance and insurance, net | Retail Automotive and Retail Commercial Truck Dealership | |||||
Revenues | |||||
Payment period | 30 days | ||||
Aggregate reserves relating to chargeback activity | $ 40.8 | $ 40.8 | $ 38.4 |
Revenues - Retail Commercial Truck Dealership (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Revenues | ||||
Total revenues | $ 7,468.5 | $ 6,906.9 | $ 14,807.5 | $ 13,882.3 |
Retail commercial truck dealership | ||||
Revenues | ||||
Total revenues | 919.2 | 768.7 | 1,814.8 | 1,561.0 |
New truck | Retail commercial truck dealership | ||||
Revenues | ||||
Total revenues | 616.4 | 447.3 | 1,216.6 | 919.0 |
Used truck | Retail commercial truck dealership | ||||
Revenues | ||||
Total revenues | 52.4 | 78.7 | 101.9 | 179.0 |
Finance and insurance, net | Retail commercial truck dealership | ||||
Revenues | ||||
Total revenues | 5.0 | 4.5 | 10.0 | 10.9 |
Service and parts | Retail commercial truck dealership | ||||
Revenues | ||||
Total revenues | 232.1 | 219.6 | 460.1 | 416.6 |
Other | Retail commercial truck dealership | ||||
Revenues | ||||
Total revenues | $ 13.3 | $ 18.6 | $ 26.2 | $ 35.5 |
Revenues - Commercial Vehicle Distribution (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Revenues | ||||
Total revenues | $ 7,468.5 | $ 6,906.9 | $ 14,807.5 | $ 13,882.3 |
Commercial vehicle distribution and other | ||||
Revenues | ||||
Total revenues | 143.3 | 140.9 | 286.9 | 294.8 |
Commercial vehicle distribution and other | Service and parts | ||||
Revenues | ||||
Total revenues | $ 68.0 | $ 60.5 | $ 129.3 | $ 115.6 |
Revenues - Contract Balances (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Contract Balances | ||
Accounts receivable | $ 890.6 | $ 906.7 |
Unearned revenues | 286.7 | 291.7 |
Unearned revenue recognized as revenue | 168.8 | |
Contracts in transit | ||
Contract Balances | ||
Accounts receivable | 245.3 | 281.7 |
Vehicle receivables | ||
Contract Balances | ||
Accounts receivable | 141.7 | 235.1 |
Manufacturer receivables | ||
Contract Balances | ||
Accounts receivable | 184.3 | 178.9 |
Trade receivables | ||
Contract Balances | ||
Accounts receivable | $ 298.3 | $ 191.1 |
Leases - Other (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Leases | ||||
Total undiscounted rent obligations | $ 5,235.1 | $ 5,235.1 | ||
Sublease rent received | $ 4.3 | $ 4.6 | $ 8.5 | $ 9.7 |
Property leases | Minimum | ||||
Leases | ||||
Initial lease period (in years) | 5 years | 5 years | ||
Property leases | Maximum | ||||
Leases | ||||
Initial lease period (in years) | 20 years | 20 years | ||
Equipment leases | Maximum | ||||
Leases | ||||
Initial lease period (in years) | 5 years | 5 years |
Leases - Net operating lease cost (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Lease Cost | ||||
Operating lease cost | $ 65.2 | $ 63.8 | $ 129.6 | $ 127.2 |
Sublease income | (4.3) | (4.6) | (8.5) | (9.7) |
Total lease cost | $ 60.9 | $ 59.2 | $ 121.1 | $ 117.5 |
Leases - Cash flow information, weighted average remaining term and discount rate (Details) - USD ($) $ in Millions |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating cash flows from operating leases | $ 129.3 | $ 122.5 | |
Right-of-use assets disposed in exchange for operating lease liabilities | $ (4.4) | $ 82.2 | |
Weighted-average remaining lease term - operating leases | 25 years | 25 years | |
Weighted-average discount rate - operating leases | 6.50% | 6.50% |
Leases - Maturity of lease liabilities (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Maturity of Lease Liabilities | ||
2023 | $ 124.4 | |
2024 | 244.2 | |
2025 | 239.7 | |
2026 | 232.9 | |
2027 | 225.3 | |
2028 | 215.1 | |
2029 and thereafter | 3,953.5 | |
Total future minimum lease payments | 5,235.1 | |
Less: Imputed interest | $ (2,832.2) | |
Current operating lease liabilities | Accrued expenses and other current liabilities | |
Current operating lease liabilities | $ 94.3 | |
Long-term operating lease liabilities | 2,308.6 | $ 2,335.7 |
Total operating lease liabilities | $ 2,402.9 |
Inventories (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Inventory [Line Items] | ||
Total inventories | $ 3,881.3 | $ 3,509.1 |
Retail automotive dealership new vehicles | ||
Inventory [Line Items] | ||
Total inventories | 1,545.3 | 1,326.5 |
Retail automotive dealership used vehicles | ||
Inventory [Line Items] | ||
Total inventories | 1,353.8 | 1,279.6 |
Retail automotive parts, accessories, and other | ||
Inventory [Line Items] | ||
Total inventories | 150.3 | 145.6 |
Retail commercial truck dealership vehicles and parts | ||
Inventory [Line Items] | ||
Total inventories | 501.5 | 506.2 |
Commercial vehicle distribution vehicles, parts, and engines | ||
Inventory [Line Items] | ||
Total inventories | $ 330.4 | $ 251.2 |
Inventory (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Inventory Disclosure [Abstract] | ||||
Interest credits and advertising assistance | $ 11.4 | $ 10.4 | $ 24.7 | $ 25.6 |
Business Combinations (Narrative) (Details) |
1 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2023
dealership
center
|
Jun. 30, 2022
franchise
dealership
|
|
Retail automotive dealership | ||
Business Acquisition [Line Items] | ||
Number of franchises acquired | 10 | |
Retail automotive dealership | U.K. | ||
Business Acquisition [Line Items] | ||
Number of franchises acquired | 6 | |
Retail automotive dealership | U.S. | ||
Business Acquisition [Line Items] | ||
Number of franchises acquired | 4 | |
Transolutions Truck Centres | Retail commercial truck dealership | ||
Business Acquisition [Line Items] | ||
Number of full service dealerships acquired | dealership | 3 | |
Number of service and parts centers acquired | center | 2 | |
TEAM Truck Centres | Retail commercial truck dealership | ||
Business Acquisition [Line Items] | ||
Number of full service dealerships acquired | dealership | 4 |
Business Combinations - Consideration Paid and Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed | ||
Accounts receivable | $ 0.0 | $ 8.3 |
Inventories | 25.3 | 71.5 |
Other current assets | 0.1 | 3.2 |
Property and equipment | 2.8 | 43.3 |
Indefinite-lived intangibles | 54.1 | 120.9 |
Other noncurrent assets | 0.0 | 0.0 |
Current liabilities | (1.8) | (11.3) |
Noncurrent liabilities | 0.0 | (10.0) |
Total cash used in acquisitions | $ 80.5 | $ 225.9 |
Business Combinations - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Summary of unaudited consolidated pro forma results of operations | ||||
Revenues | $ 7,499.2 | $ 7,074.4 | $ 14,884.2 | $ 14,345.6 |
Net income attributable to Penske Automotive Group common stockholders | $ 301.5 | $ 375.9 | $ 601.0 | $ 749.3 |
Net income per diluted common share (in dollars per share) | $ 4.42 | $ 4.96 | $ 8.75 | $ 9.79 |
Intangible Assets - Summary of Changes (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2023
USD ($)
| |
Goodwill | |
Beginning balance | $ 2,154.7 |
Additions | 31.1 |
Disposals | 0.0 |
Foreign currency translation | 23.1 |
Ending balance | 2,208.9 |
Other Indefinite- Lived Intangible Assets | |
Beginning balance | 690.9 |
Additions | 23.0 |
Disposals | 0.0 |
Foreign currency translation | 4.7 |
Ending balance | $ 718.6 |
Intangible Assets - Information by Segment (Details) - USD ($) $ in Millions |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Goodwill [Line Items] | ||
Goodwill | $ 2,208.9 | $ 2,154.7 |
Retail automotive dealership | ||
Goodwill [Line Items] | ||
Goodwill | 1,641.4 | |
Retail commercial truck dealership | ||
Goodwill [Line Items] | ||
Goodwill | 494.2 | |
Other | ||
Goodwill [Line Items] | ||
Goodwill | 73.3 | |
Non-Automotive Investments | ||
Goodwill [Line Items] | ||
Goodwill | $ 0.0 |
Vehicle Financing (Details) |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Short-Term Debt [Abstract] | ||
Maturity period of floor plan arrangements outside the U.S. if not payable on demand | 90 days | |
Weighted average interest rate on floor plan borrowings (as a percent) | 4.20% | 1.30% |
Earnings Per Share - (Details) - shares |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Reconciliation of number of shares used in calculation of basic and diluted earnings per share | ||||
Weighted average number of common shares outstanding (in shares) | 68,175,825 | 75,793,239 | 68,689,106 | 76,501,402 |
Effect of non-participatory equity compensation (in shares) | 15,003 | 23,880 | 15,003 | 23,880 |
Weighted average number of common shares outstanding, including effect of dilutive securities (in shares) | 68,190,828 | 75,817,119 | 68,704,109 | 76,525,282 |
Long-Term Debt - Summary of Senior Subordinated Notes (Details) $ in Millions |
Jun. 30, 2023
USD ($)
|
---|---|
3.50% senior subordinated notes due 2025 | |
Debt Instrument [Line Items] | |
Interest rate | 3.50% |
Senior unsecured notes issued | $ 550 |
3.75% senior subordinated notes due 2029 | |
Debt Instrument [Line Items] | |
Interest rate | 3.75% |
Senior unsecured notes issued | $ 500 |
Commitments and Contingent Liabilities (Details) $ in Millions |
Jun. 30, 2023
USD ($)
|
---|---|
Commitments and Contingencies Disclosure [Abstract] | |
Letters of credit outstanding | $ 26.1 |
Bank guarantees | 13.0 |
Surety bonds posted | $ 21.6 |
Equity (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
May 31, 2023 |
|
Securities Repurchase Program | |||||
Repurchase of common stock | $ 242.0 | $ 173.4 | $ 353.3 | $ 292.6 | |
Securities Repurchase Program | |||||
Securities Repurchase Program | |||||
Repurchased shares (in shares) | 1,551,058 | 2,441,385 | |||
Repurchase of common stock | $ 217.8 | $ 328.0 | |||
Repurchased shares, average price (in dollars per share) | $ 140.44 | $ 134.36 | |||
Amount authorized to be repurchased | $ 250.0 | ||||
Remaining amount authorized to be repurchased | $ 246.3 | $ 246.3 | |||
Acquired Employee Equity Awards | |||||
Securities Repurchase Program | |||||
Repurchased shares (in shares) | 162,174 | ||||
Repurchase of common stock | $ 22.4 | ||||
Repurchased shares, average price (in dollars per share) | $ 138.43 |
Label | Element | Value |
---|---|---|
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2016-02 [Member] |
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