Delaware | 001-10308 | 06-0918165 |
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
6 Sylvan Way Parsippany, NJ | 07054 |
(Address of Principal Executive Offices) | (Zip Code) |
Exhibit No. | Description |
99.1 | Press Release dated August 2, 2016. |
AVIS BUDGET GROUP, INC. | ||
By: | /s/ David T. Calabria | |
David T. Calabria Senior Vice President and Chief Accounting Officer |
Exhibit No. | Description |
99.1 | Press Release dated August 2, 2016. |
AVIS BUDGET GROUP REPORTS SECOND QUARTER RESULTS |
• | Revenue increased 3% in the second quarter to $2.2 billion. |
• | Net income was $36 million, and Adjusted EBITDA was $204 million. |
• | Diluted earnings per share were $0.38, and adjusted diluted earnings per share were $0.63. |
• | Company increases its 2016 Adjusted EBITDA estimate to $850 to $900 million and adjusted earnings per share to $2.90 to $3.30. |
2016 | 2015 | % change | |||||||
Revenue | $ | 1,593 | $ | 1,556 | 2 | % | |||
Adjusted EBITDA | $ | 163 | $ | 178 | (8 | %) |
2016 | 2015 | % change | |||||||
Revenue | $ | 650 | $ | 617 | 5 | % | |||
Adjusted EBITDA | $ | 57 | $ | 61 | (7 | %) |
• | Full-year 2016 revenue will increase 3% to 5%, to $8.75 to $8.9 billion. Movements in currency exchange rates are currently expected to negatively impact revenue growth by approximately $50 million. In the Company’s Americas segment, rental days are expected to increase 2% to 3%, and pricing is now expected to be largely unchanged, with no |
• | Total Company per-unit fleet costs are expected to be $285 to $290 per month in 2016, compared to $277 in 2015. In the Company’s Americas segment, per-unit fleet costs are expected to be $313 to $316 per month in 2016, an increase of 5% to 6% compared to $297 in 2015. In the Company’s International segment, per-unit fleet costs are expected to be $223 to $227 per month in 2016, compared to $229 per month in 2015, which represents a decrease of 1% to 3%, including a 1% reduction from currency exchange rates. |
• | Adjusted EBITDA is expected to be $850 million to $900 million, including an approximately $20 million negative year-over-year impact from movements in currency exchange rates. |
• | Interest expense related to corporate debt will be approximately $205 million. |
• | 2016 non-vehicle depreciation and amortization expense (excluding the amortization of intangible assets related to acquisitions of $60 million) will be approximately $195 million. |
• | Adjusted pretax income will be $450 to $500 million. |
• | The Company’s effective tax rate applicable to adjusted pretax income in 2016 will be approximately 39%. |
• | The Company’s diluted share count will be 93 million to 95 million, including the effect of repurchasing $350 million of stock in 2016. |
Contacts | |
Media Contact: | Investor Contact: |
Alice Pereira | Neal Goldner |
(973) 496-3916 | (973) 496-5086 |
PR@avisbudget.com | IR@avisbudget.com |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2016 | 2015 | % Change | 2016 | 2015 | % Change | ||||||||||||||||||
Income Statement and Other Items | |||||||||||||||||||||||
Net revenues | $ | 2,243 | $ | 2,173 | 3 | % | $ | 4,124 | $ | 4,023 | 3 | % | |||||||||||
Income (loss) before income taxes | 63 | 82 | (23 | %) | (23 | ) | 66 | * | |||||||||||||||
Net income (loss) | 36 | 143 | (75 | %) | (15 | ) | 134 | * | |||||||||||||||
Earnings (loss) per share - Diluted | 0.38 | 1.34 | (72 | %) | (0.16 | ) | 1.25 | * | |||||||||||||||
Adjusted Earnings Metrics (non-GAAP) (A) | |||||||||||||||||||||||
Adjusted EBITDA | 204 | 227 | (10 | %) | 248 | 344 | (28 | %) | |||||||||||||||
Adjusted pretax income | 98 | 142 | (31 | %) | 46 | 168 | (73 | %) | |||||||||||||||
Adjusted net income | 60 | 90 | (33 | %) | 33 | 109 | (70 | %) | |||||||||||||||
Adjusted earnings per share - Diluted | 0.63 | 0.84 | (25 | %) | 0.34 | 1.01 | (66 | %) | |||||||||||||||
As of | |||||||||||||||||||||||
June 30, 2016 | December 31, 2015 | ||||||||||||||||||||||
Balance Sheet Items | |||||||||||||||||||||||
Cash and cash equivalents | $ | 527 | $ | 452 | |||||||||||||||||||
Vehicles, net | 13,227 | 10,658 | |||||||||||||||||||||
Debt under vehicle programs | 11,165 | 8,860 | |||||||||||||||||||||
Corporate debt | 3,530 | 3,461 | |||||||||||||||||||||
Stockholders’ equity | 339 | 439 |
Segment Results | |||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2016 | 2015 | % Change | 2016 | 2015 | % Change | ||||||||||||||||||
Net Revenues | |||||||||||||||||||||||
Americas | $ | 1,593 | $ | 1,556 | 2 | % | $ | 2,957 | $ | 2,931 | 1 | % | |||||||||||
International | 650 | 617 | 5 | % | 1,167 | 1,092 | 7 | % | |||||||||||||||
Corporate and Other | — | — | * | — | — | * | |||||||||||||||||
Total Company | $ | 2,243 | $ | 2,173 | 3 | % | $ | 4,124 | $ | 4,023 | 3 | % | |||||||||||
Adjusted EBITDA (A) | |||||||||||||||||||||||
Americas | $ | 163 | $ | 178 | (8 | %) | $ | 226 | $ | 293 | (23 | %) | |||||||||||
International | 57 | 61 | (7 | %) | 58 | 77 | (25 | %) | |||||||||||||||
Corporate and Other | (16 | ) | (12 | ) | * | (36 | ) | (26 | ) | * | |||||||||||||
Total Company | $ | 204 | $ | 227 | (10 | %) | $ | 248 | $ | 344 | (28 | %) | |||||||||||
_______ | ||||
* | Not meaningful. | |||
(A) | See Table 5 for definitions and reconciliations of non-GAAP measures. Adjusted EBITDA includes stock-based compensation expense and deferred financing fee amortization of $14 million and $16 million in second quarter 2016 and 2015, respectively, and $27 million and $29 million in the six months ended June 30, 2016 and 2015, respectively. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
Revenues | ||||||||||||||||
Vehicle rental | $ | 1,573 | $ | 1,533 | $ | 2,901 | $ | 2,852 | ||||||||
Other | 670 | 640 | 1,223 | 1,171 | ||||||||||||
Net revenues | 2,243 | 2,173 | 4,124 | 4,023 | ||||||||||||
Expenses | ||||||||||||||||
Operating | 1,122 | 1,092 | 2,162 | 2,077 | ||||||||||||
Vehicle depreciation and lease charges, net | 532 | 498 | 995 | 930 | ||||||||||||
Selling, general and administrative | 312 | 281 | 581 | 529 | ||||||||||||
Vehicle interest, net | 73 | 75 | 138 | 143 | ||||||||||||
Non-vehicle related depreciation and amortization | 65 | 56 | 126 | 105 | ||||||||||||
Interest expense related to corporate debt, net: | ||||||||||||||||
Interest expense | 56 | 45 | 106 | 97 | ||||||||||||
Early extinguishment of debt | 10 | 23 | 10 | 23 | ||||||||||||
Restructuring expense | 5 | 3 | 20 | 4 | ||||||||||||
Transaction-related costs, net | 5 | 18 | 9 | 49 | ||||||||||||
Total expenses | 2,180 | 2,091 | 4,147 | 3,957 | ||||||||||||
Income (loss) before income taxes | 63 | 82 | (23 | ) | 66 | |||||||||||
Provision for (benefit from) income taxes | 27 | (61 | ) | (8 | ) | (68 | ) | |||||||||
Net income (loss) | $ | 36 | $ | 143 | $ | (15 | ) | $ | 134 | |||||||
Earnings (loss) per share | ||||||||||||||||
Basic | $ | 0.39 | $ | 1.36 | $ | (0.16 | ) | $ | 1.27 | |||||||
Diluted | $ | 0.38 | $ | 1.34 | $ | (0.16 | ) | $ | 1.25 | |||||||
Weighted average shares outstanding | ||||||||||||||||
Basic | 93.9 | 105.5 | 95.1 | 105.8 | ||||||||||||
Diluted | 95.1 | 106.7 | 95.1 | 107.1 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2016 | 2015 | % Change | 2016 | 2015 | % Change | |||||||||||||||||||
Americas | ||||||||||||||||||||||||
Rental Days (000’s) | 26,214 | 25,823 | 2 | % | 49,335 | 48,264 | 2 | % | ||||||||||||||||
Time and Mileage Revenue per Day (A) | $ | 40.25 | $ | 39.71 | 1 | % | $ | 39.83 | $ | 40.56 | (2 | %) | ||||||||||||
Average Rental Fleet | 404,932 | 404,415 | 0 | % | 381,580 | 380,405 | 0 | % | ||||||||||||||||
International | ||||||||||||||||||||||||
Rental Days (000’s) | 11,795 | 10,916 | 8 | % | 21,262 | 18,730 | 14 | % | ||||||||||||||||
Time and Mileage Revenue per Day (B) | $ | 31.76 | $ | 33.08 | (4 | %) | $ | 31.94 | $ | 34.10 | (6 | %) | ||||||||||||
Average Rental Fleet | 182,797 | 170,307 | 7 | % | 165,758 | 147,390 | 12 | % | ||||||||||||||||
Total | ||||||||||||||||||||||||
Rental Days (000’s) | 38,009 | 36,739 | 3 | % | 70,597 | 66,994 | 5 | % | ||||||||||||||||
Time and Mileage Revenue per Day | $ | 37.62 | $ | 37.74 | 0 | % | $ | 37.45 | $ | 38.75 | (3 | %) | ||||||||||||
Average Rental Fleet | 587,729 | 574,722 | 2 | % | 547,338 | 527,795 | 4 | % | ||||||||||||||||
_______ | ||||||||||||||||||||||||
Rental days and time and mileage revenue per day are calculated based on the actual rental of the vehicle during a 24-hour period. Our calculation of rental days and time and mileage revenue per day may not be comparable to the calculation of similarly-titled statistics by other companies. Amounts exclude U.S. truck rental and Zipcar transactions. | ||||||||||||||||||||||||
(A) | Changes in currency exchange rates had a 1% negative impact in the three and six months ended June 30, 2016. | |||||||||||||||||||||||
(B) | Changes in currency exchange rates had a 1% and 2% negative impact in the three and six months ended June 30, 2016, respectively. |
Six Months Ended June 30, 2016 | |||||
Operating Activities | |||||
Net cash provided by operating activities | $ | 1,070 | |||
Investing Activities | |||||
Net cash used in investing activities exclusive of vehicle programs | (81 | ) | |||
Net cash used in investing activities of vehicle programs | (3,000 | ) | |||
Net cash used in investing activities | (3,081 | ) | |||
Financing Activities | |||||
Net cash used in financing activities exclusive of vehicle programs | (146 | ) | |||
Net cash provided by financing activities of vehicle programs | 2,219 | ||||
Net cash provided by financing activities | 2,073 | ||||
Effect of changes in exchange rates on cash and cash equivalents | 13 | ||||
Net change in cash and cash equivalents | 75 | ||||
Cash and cash equivalents, beginning of period | 452 | ||||
Cash and cash equivalents, end of period | $ | 527 |
Six Months Ended June 30, 2016 | |||||
Loss before income taxes | $ | (23 | ) | ||
Add-back of non-vehicle related depreciation and amortization | 126 | ||||
Add-back of debt extinguishment costs | 10 | ||||
Add-back of transaction-related costs | 9 | ||||
Working capital and other | (19 | ) | |||
Capital expenditures | (90 | ) | |||
Tax payments, net of refunds | (36 | ) | |||
Vehicle programs and related (B) | 241 | ||||
Free Cash Flow | 218 | ||||
Acquisition and related payments, net of acquired cash | (3 | ) | |||
Borrowings, net of debt repayments | 38 | ||||
Transaction-related payments | (10 | ) | |||
Repurchases of common stock | (174 | ) | |||
Foreign exchange effects, financing costs and other | 6 | ||||
Net change in cash and cash equivalents (per above) | $ | 75 |
_______ | |
(A) | See Table 5 for a description of Free Cash Flow. |
(B) | Includes vehicle-backed borrowings (repayments) that are incremental to amounts required to fund incremental (reduced) vehicle and vehicle-related assets. |
Six Months Ended June 30, 2016 | |||||
Free Cash Flow (per above) | $ | 218 | |||
Investing activities of vehicle programs | 3,000 | ||||
Financing activities of vehicle programs | (2,219 | ) | |||
Capital expenditures | 90 | ||||
Proceeds received on asset sales | (7 | ) | |||
Change in restricted cash | (2 | ) | |||
Acquisition-related payments | — | ||||
Transaction-related payments | (10 | ) | |||
Net Cash Provided by Operating Activities (per above) | $ | 1,070 |
Three Months Ended June 30, | |||||||||
Reconciliation of Adjusted EBITDA to net income: | 2016 | 2015 | |||||||
Adjusted EBITDA | $ | 204 | $ | 227 | |||||
Less: | Non-vehicle related depreciation and amortization (excluding acquisition-related amortization expense) | 50 | 40 | ||||||
Interest expense related to corporate debt, net (excluding early extinguishment of debt) | 56 | 45 | |||||||
Adjusted pretax income | 98 | 142 | |||||||
Less certain items: | |||||||||
Acquisition-related amortization expense | 15 | 16 | |||||||
Early extinguishment of debt | 10 | 23 | |||||||
Restructuring expense | 5 | 3 | |||||||
Transaction-related costs, net | 5 | 18 | |||||||
Income before income taxes | 63 | 82 | |||||||
Provision for (benefit from) income taxes | 27 | (61 | ) | ||||||
Net income | $ | 36 | $ | 143 | |||||
Reconciliation of adjusted net income to net income: | |||||||||
Adjusted net income | $ | 60 | $ | 90 | |||||
Less certain items, net of tax: | |||||||||
Acquisition-related amortization expense | 10 | 10 | |||||||
Early extinguishment of debt | 6 | 14 | |||||||
Restructuring expense | 4 | 3 | |||||||
Transaction-related costs, net | 4 | 18 | |||||||
Resolution of a prior-year income tax matter | — | (98 | ) | ||||||
Net income | $ | 36 | $ | 143 | |||||
Adjusted diluted earnings per share | $ | 0.63 | $ | 0.84 | |||||
Earnings per share - Diluted | $ | 0.38 | $ | 1.34 | |||||
Shares used to calculate adjusted diluted earnings per share | 95.1 | 106.7 |
Six Months Ended June 30, | |||||||||
Reconciliation of Adjusted EBITDA to net income (loss): | 2016 | 2015 | |||||||
Adjusted EBITDA | $ | 248 | $ | 344 | |||||
Less: | Non-vehicle related depreciation and amortization (excluding acquisition-related amortization expense) | 96 | 79 | ||||||
Interest expense related to corporate debt, net (excluding early extinguishment of debt) | 106 | 97 | |||||||
Adjusted pretax income | 46 | 168 | |||||||
Less certain items: | |||||||||
Acquisition-related amortization expense | 30 | 26 | |||||||
Restructuring expense | 20 | 4 | |||||||
Early extinguishment of debt | 10 | 23 | |||||||
Transaction-related costs, net | 9 | 49 | |||||||
Income (loss) before income taxes | (23 | ) | 66 | ||||||
Benefit from income taxes | (8 | ) | (68 | ) | |||||
Net income (loss) | $ | (15 | ) | $ | 134 | ||||
Reconciliation of adjusted net income to net income (loss): | |||||||||
Adjusted net income | $ | 33 | $ | 109 | |||||
Less certain items, net of tax: | |||||||||
Acquisition-related amortization expense | 20 | 17 | |||||||
Restructuring expense | 15 | 3 | |||||||
Early extinguishment of debt | 6 | 14 | |||||||
Transaction-related costs, net | 7 | 39 | |||||||
Resolution of a prior-year income tax matter | — | (98 | ) | ||||||
Net income (loss) | $ | (15 | ) | $ | 134 | ||||
Adjusted diluted earnings per share | $ | 0.34 | $ | 1.01 | |||||
Earnings (loss) per share - Diluted | $ | (0.16 | ) | $ | 1.25 | ||||
Shares used to calculate adjusted diluted earnings per share | 96.3 | 107.1 |
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