Oregon | 001-14733 | 93-0572810 | |||||||||
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | |||||||||
150 N. Bartlett Street | Medford | Oregon | 97501 | ||||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Common stock without par value | LAD | The New York Stock Exchange |
Press Release of Lithia Motors, Inc. dated April 24, 2024 | |||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Date: April 24, 2024 | LITHIA MOTORS, INC. | |||||||
Registrant | ||||||||
By: | /s/ Tina Miller | |||||||
Tina Miller | ||||||||
Chief Financial Officer, Senior Vice President, and Principal Accounting Officer |
Three months ended March 31, | % | |||||||||||||||||||
Increase | ||||||||||||||||||||
2024 | 2023 | (Decrease) | ||||||||||||||||||
Revenues: | ||||||||||||||||||||
New vehicle retail | $ | 4,014.1 | $ | 3,278.9 | 22.4 | % | ||||||||||||||
Used vehicle retail | 2,800.8 | 2,227.5 | 25.7 | |||||||||||||||||
Used vehicle wholesale | 332.2 | 356.7 | (6.9) | |||||||||||||||||
Finance and insurance | 340.6 | 318.3 | 7.0 | |||||||||||||||||
Service, body and parts | 912.8 | 736.3 | 24.0 | |||||||||||||||||
Fleet and other | 155.9 | 56.1 | 177.9 | |||||||||||||||||
Total revenues |
8,556.4 | 6,973.8 | 22.7 | % | ||||||||||||||||
Cost of sales: | ||||||||||||||||||||
New vehicle retail | 3,718.8 | 2,945.1 | 26.3 | |||||||||||||||||
Used vehicle retail | 2,598.6 | 2,061.8 | 26.0 | |||||||||||||||||
Used vehicle wholesale | 352.8 | 359.5 | (1.9) | |||||||||||||||||
Service, body and parts | 410.8 | 341.9 | 20.2 | |||||||||||||||||
Fleet and other | 140.2 | 54.0 | 159.6 | |||||||||||||||||
Total cost of sales | 7,221.2 | 5,762.3 | 25.3 | |||||||||||||||||
Gross profit | 1,335.2 | 1,211.5 | 10.2 | % | ||||||||||||||||
Financing operations loss |
(1.7) | (20.8) | (91.8) | % | ||||||||||||||||
SG&A expense | 934.3 | 764.4 | 22.2 | |||||||||||||||||
Depreciation and amortization | 57.8 | 47.3 | 22.2 | |||||||||||||||||
Income from operations | 341.4 | 379.0 | (9.9) | % | ||||||||||||||||
Floor plan interest expense | (60.7) | (27.7) | 119.1 | |||||||||||||||||
Other interest expense | (63.6) | (39.0) | 63.1 | |||||||||||||||||
Other income (expense), net | 3.5 | 2.0 | NM | |||||||||||||||||
Income before income taxes | 220.6 | 314.3 | (29.8) | % | ||||||||||||||||
Income tax expense | (55.6) | (84.7) | (34.4) | |||||||||||||||||
Income tax rate | 25.2 | % | 26.9 | % | ||||||||||||||||
Net income | $ | 165.0 | $ | 229.6 | (28.1) | % | ||||||||||||||
Net income attributable to non-controlling interests | (1.5) | (0.7) | 114.3% | |||||||||||||||||
Net income attributable to redeemable non-controlling interest | (0.9) | (0.2) | 350.0% | |||||||||||||||||
Net income attributable to LAD | $ | 162.6 | $ | 228.7 | (28.9) | % | ||||||||||||||
Diluted earnings per share attributable to LAD: | ||||||||||||||||||||
Net income per share | $ | 5.89 | $ | 8.30 | (29.0) | % | ||||||||||||||
Diluted shares outstanding | 27.6 | 27.5 | 0.4 | % |
Three months ended March 31, | % | |||||||||||||||||||
Increase | ||||||||||||||||||||
2024 | 2023 | (Decrease) | ||||||||||||||||||
Gross margin | ||||||||||||||||||||
New vehicle retail | 7.4 | % | 10.2 | % | (280) | bps | ||||||||||||||
Used vehicle retail | 7.2 | 7.4 | (20) | |||||||||||||||||
Finance and insurance | 100.0 | 100.0 | — | |||||||||||||||||
Service, body and parts | 55.0 | 53.6 | 140 | |||||||||||||||||
Gross profit margin | 15.6 | 17.4 | (180) | |||||||||||||||||
Unit sales | ||||||||||||||||||||
New vehicle retail | 85,683 | 67,796 | 26.4 | % | ||||||||||||||||
Used vehicle retail | 102,436 | 78,142 | 31.1 | |||||||||||||||||
Average selling price | ||||||||||||||||||||
New vehicle retail | $ | 46,848 | $ | 48,364 | (3.1) | % | ||||||||||||||
Used vehicle retail | 27,342 | 28,506 | (4.1) | |||||||||||||||||
Average gross profit per unit | ||||||||||||||||||||
New vehicle retail | $ | 3,447 | $ | 4,924 | (30.0) | % | ||||||||||||||
Used vehicle retail | 1,974 | 2,120 | (6.9) | |||||||||||||||||
Finance and insurance | 1,811 | 2,181 | (17.0) | |||||||||||||||||
Total vehicle(1) |
4,346 | 5,585 | (22.2) | |||||||||||||||||
Revenue mix | ||||||||||||||||||||
New vehicle retail | 46.9 | % | 47.0 | % | ||||||||||||||||
Used vehicle retail | 32.7 | 31.9 | ||||||||||||||||||
Used vehicle wholesale | 3.9 | 5.1 | ||||||||||||||||||
Finance and insurance, net | 4.0 | 4.6 | ||||||||||||||||||
Service, body and parts | 10.7 | 10.6 | ||||||||||||||||||
Fleet and other | 1.8 | 0.8 | ||||||||||||||||||
Gross Profit Mix | ||||||||||||||||||||
New vehicle retail | 22.1 | % | 27.6 | % | ||||||||||||||||
Used vehicle retail | 15.1 | 13.7 | ||||||||||||||||||
Used vehicle wholesale | (1.5) | (0.2) | ||||||||||||||||||
Finance and insurance, net | 25.5 | 26.3 | ||||||||||||||||||
Service, body and parts | 37.6 | 32.4 | ||||||||||||||||||
Fleet and other | 1.2 | 0.2 |
Adjusted | As reported | |||||||||||||||||||||||||
Three months ended March 31, | Three months ended March 31, | |||||||||||||||||||||||||
Other metrics | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
SG&A as a % of revenue | 10.8 | % | 10.9 | % | 10.9 | % | 11.0 | % | ||||||||||||||||||
SG&A as a % of gross profit | 69.4 | 62.7 | 70.0 | 63.1 | ||||||||||||||||||||||
Operating profit as a % of revenue | 4.1 | 5.5 | 4.0 | 5.4 | ||||||||||||||||||||||
Operating profit as a % of gross profit | 26.1 | 31.6 | 25.6 | 31.3 | ||||||||||||||||||||||
Pretax margin | 2.7 | 4.6 | 2.6 | 4.5 | ||||||||||||||||||||||
Net profit margin | 2.0 | 3.3 | 1.9 | 3.3 |
Three months ended March 31, | % | |||||||||||||||||||
Increase | ||||||||||||||||||||
2024 | 2023 | (Decrease) | ||||||||||||||||||
Revenues | ||||||||||||||||||||
New vehicle retail | $ | 3,261.0 | $ | 3,188.7 | 2.3 | % | ||||||||||||||
Used vehicle retail | 2,039.6 | 2,148.0 | (5.0) | |||||||||||||||||
Finance and insurance | 297.7 | 312.7 | (4.8) | |||||||||||||||||
Service, body and parts | 740.2 | 717.5 | 3.2 | |||||||||||||||||
Total revenues | 6,639.8 | 6,771.1 | (1.9) | |||||||||||||||||
Gross profit | ||||||||||||||||||||
New vehicle retail | $ | 235.7 | $ | 323.5 | (27.1) | % | ||||||||||||||
Used vehicle retail | 152.6 | 160.6 | (5.0) | |||||||||||||||||
Finance and insurance | 297.7 | 312.7 | (4.8) | |||||||||||||||||
Service, body and parts | 409.7 | 384.4 | 6.6 | |||||||||||||||||
Total gross profit | 1,094.8 | 1,180.3 | (7.2) | |||||||||||||||||
Gross margin | ||||||||||||||||||||
New vehicle retail | 7.2 | % | 10.1 | % | (290) | bps | ||||||||||||||
Used vehicle retail | 7.5 | 7.5 | — | |||||||||||||||||
Finance and insurance | 100.0 | 100.0 | — | |||||||||||||||||
Service, body and parts | 55.4 | 53.6 | 180 | |||||||||||||||||
Gross profit margin | 16.5 | 17.4 | (90) | |||||||||||||||||
Unit sales | ||||||||||||||||||||
New vehicle retail | 68,373 | 65,980 | 3.6 | % | ||||||||||||||||
Used vehicle retail | 74,710 | 75,928 | (1.6) | |||||||||||||||||
Average selling price | ||||||||||||||||||||
New vehicle retail | $ | 47,695 | $ | 48,328 | (1.3) | % | ||||||||||||||
Used vehicle retail | 27,300 | 28,290 | (3.5) | |||||||||||||||||
Average gross profit per unit | ||||||||||||||||||||
New vehicle retail | $ | 3,448 | $ | 4,903 | (29.7) | % | ||||||||||||||
Used vehicle retail | 2,043 | 2,116 | (3.4) | |||||||||||||||||
Finance and insurance | 2,080 | 2,204 | (5.6) | |||||||||||||||||
Total vehicle(1) |
4,760 | 5,594 | (14.9) |
Three months ended March 31, | ||||||||||||||
2024 | ||||||||||||||
Key Performance by Country | Total Revenue |
Total Gross Profit |
||||||||||||
United States |
79.0% | 84.5% | ||||||||||||
United Kingdom |
18.2% | 13.0% | ||||||||||||
Canada |
2.8% | 2.5% | ||||||||||||
As of | |||||||||||||||||
March 31, | December 31, | March 31, | |||||||||||||||
2024 | 2023 | 2023 | |||||||||||||||
Days Supply(1) |
|||||||||||||||||
New vehicle inventory | 60 | 65 | 51 | ||||||||||||||
Used vehicle inventory | 58 | 64 | 53 |
Three months ended March 31, | |||||||||||||||||||||||
($ in millions) | 2024 | % (1) |
2023 | % (1) |
|||||||||||||||||||
Interest margin: | |||||||||||||||||||||||
Interest and fee income | $ | 77.3 | 9.0 | $ | 49.3 | 8.1 | |||||||||||||||||
Interest expense | (47.8) | (5.6) | (37.5) | (6.2) | |||||||||||||||||||
Total interest margin | $ | 29.5 | 3.5 | $ | 11.8 | 1.9 | |||||||||||||||||
Lease income | 22.4 | 4.6 | |||||||||||||||||||||
Depreciation and amortization | (18.0) | (2.3) | |||||||||||||||||||||
Lease income, net |
4.4 | 2.3 | |||||||||||||||||||||
Selling, general and administrative | (10.6) | (8.6) | |||||||||||||||||||||
Provision expense | (25.0) | (2.9) | (26.3) | (4.3) | |||||||||||||||||||
Financing operations loss | $ | (1.7) | $ | (20.8) | |||||||||||||||||||
Total average managed finance receivables | $ | 3,436.6 | $ | 2,461.9 | |||||||||||||||||||
Ending funded managed receivables | $ | 3,106.3 | $ | 2,247.9 | |||||||||||||||||||
% of ending managed receivables | 88.1% | 84.3% |
March 31, 2024 | December 31, 2023 | |||||||||||||
Cash, restricted cash, and cash equivalents | $ | 404.6 | $ | 941.4 | ||||||||||
Trade receivables, net | 1,249.3 | 1,123.1 | ||||||||||||
Inventories, net | 5,861.9 | 4,753.9 | ||||||||||||
Other current assets | 217.4 | 136.8 | ||||||||||||
Total current assets | $ | 7,733.2 | $ | 6,955.2 | ||||||||||
Property and equipment, net | 4,502.0 | 3,981.4 | ||||||||||||
Finance receivables, net | 3,412.5 | 3,242.3 | ||||||||||||
Intangibles | 4,619.7 | 4,332.8 | ||||||||||||
Other non-current assets | 1,912.6 | 1,120.8 | ||||||||||||
Total assets | $ | 22,180.0 | $ | 19,632.5 | ||||||||||
Floor plan notes payable | 4,962.0 | 3,635.5 | ||||||||||||
Other current liabilities | 1,629.5 | 1,296.7 | ||||||||||||
Total current liabilities | $ | 6,591.5 | $ | 4,932.2 | ||||||||||
Long-term debt, less current maturities | 5,662.4 | 5,483.7 | ||||||||||||
Non-recourse notes payable, less current maturities | 1,803.9 | 1,671.7 | ||||||||||||
Other long-term liabilities and deferred revenue | 1,700.6 | 1,262.0 | ||||||||||||
Total liabilities | $ | 15,758.4 | $ | 13,349.6 | ||||||||||
Redeemable non-controlling interest and equity | 6,421.6 | 6,282.9 | ||||||||||||
Total liabilities, redeemable non-controlling interest, and equity | $ | 22,180.0 | $ | 19,632.5 |
Three months ended March 31, | ||||||||||||||
Cash flows from operating activities: | 2024 | 2023 | ||||||||||||
Net income | $ | 165.0 | $ | 229.6 | ||||||||||
Adjustments to reconcile net income to net cash used in operating activities |
127.0 | 82.3 | ||||||||||||
Changes in: | ||||||||||||||
Inventories | (183.3) | (56.9) | ||||||||||||
Finance receivables, net | (173.8) | (397.0) | ||||||||||||
Floor plan notes payable, net | 327.7 | 38.9 | ||||||||||||
Other operating activities | 29.8 | 54.1 | ||||||||||||
Net cash provided by (used in) operating activities | 292.4 | (49.0) | ||||||||||||
Cash flows from investing activities: | ||||||||||||||
Capital expenditures | (79.6) | (38.9) | ||||||||||||
Cash paid for acquisitions, net of cash acquired | (1,074.4) | (387.4) | ||||||||||||
Proceeds from sales of stores | 6.4 | 22.7 | ||||||||||||
Other investing activities | (118.3) | (10.3) | ||||||||||||
Net cash used in investing activities | (1,265.9) | (413.9) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||
Net borrowings on floor plan notes payable, non-trade | 156.1 | 187.6 | ||||||||||||
Net borrowings non-recourse notes payable |
125.9 | 403.2 | ||||||||||||
Net borrowings (repayments) of other debt and finance lease liabilities |
201.8 | (42.1) | ||||||||||||
Proceeds from issuance of common stock | 5.7 | 6.1 | ||||||||||||
Repurchase of common stock | (15.0) | (14.4) | ||||||||||||
Dividends paid | (13.8) | (11.5) | ||||||||||||
Other financing activity | (15.7) | (19.0) | ||||||||||||
Net cash provided by financing activities | 445.0 | 509.9 | ||||||||||||
Effect of exchange rate changes on cash and restricted cash | (3.0) | 6.2 | ||||||||||||
Change in cash, restricted cash, and cash equivalents | (531.5) | 53.2 | ||||||||||||
Cash, restricted cash, and cash equivalents at beginning of period | 972.0 | 271.5 | ||||||||||||
Cash, restricted cash, and cash equivalents at end of period | 440.5 | 324.7 |
Three months ended March 31, | ||||||||||||||
Net cash provided by operating activities | 2024 | 2023 | ||||||||||||
As reported | $ | 292.4 | $ | (49.0) | ||||||||||
Floor plan notes payable, non-trade, net | 156.1 | 187.6 | ||||||||||||
Adjust: finance receivables activity | 173.8 | 397.0 | ||||||||||||
Less: Borrowings on floor plan notes payable, non-trade associated with acquired new vehicle inventory | (71.7) | (3.7) | ||||||||||||
Adjusted | $ | 550.6 | $ | 531.9 | ||||||||||
Three Months Ended March 31, 2024 | |||||||||||||||||
As reported | Acquisition expenses | Adjusted | |||||||||||||||
Selling, general and administrative | $ | 934.3 | $ | (7.7) | $ | 926.6 | |||||||||||
Operating income | 341.4 | 7.7 | 349.1 | ||||||||||||||
Income before income taxes | 220.6 | 7.7 | 228.3 | ||||||||||||||
Income tax provision | (55.6) | (1.6) | (57.2) | ||||||||||||||
Net income | $ | 165.0 | $ | 6.1 | $ | 171.1 | |||||||||||
Net income attributable to non-controlling interests | (1.5) | — | (1.5) | ||||||||||||||
Net income attributable to redeemable non-controlling interest | (0.9) | — | (0.9) | ||||||||||||||
Net income attributable to LAD | $ | 162.6 | $ | 6.1 | $ | 168.7 | |||||||||||
Diluted earnings per share attributable to LAD | $ | 5.89 | $ | 0.22 | $ | 6.11 | |||||||||||
Diluted share count | 27.6 |
Three Months Ended March 31, 2023 | |||||||||||||||||||||||||||||||||||||||||
As reported | Net disposal gain on sale of stores | Investment loss | Insurance reserves | Acquisition expenses | Contract buyouts | Adjusted | |||||||||||||||||||||||||||||||||||
Selling, general and administrative | $ | 764.4 | $ | 7.2 | $ | — | $ | (0.1) | $ | (1.3) | $ | (10.1) | $ | 760.1 | |||||||||||||||||||||||||||
Operating income | 379.0 | (7.2) | — | 0.1 | 1.3 | 10.1 | 383.3 | ||||||||||||||||||||||||||||||||||
Other income (expense), net | 2.0 | — | 0.5 | — | — | — | 2.5 | ||||||||||||||||||||||||||||||||||
Income before income taxes | 314.3 | (7.2) | 0.5 | 0.1 | 1.3 | 10.1 | 319.1 | ||||||||||||||||||||||||||||||||||
Income tax (provision) benefit | (84.7) | 1.9 | — | — | (0.2) | (2.7) | (85.7) | ||||||||||||||||||||||||||||||||||
Net income | $ | 229.6 | $ | (5.3) | $ | 0.5 | $ | 0.1 | $ | 1.1 | $ | 7.4 | $ | 233.4 | |||||||||||||||||||||||||||
Net income attributable to non-controlling interests | (0.7) | — | — | — | — | — | (0.7) | ||||||||||||||||||||||||||||||||||
Net income attributable to redeemable non-controlling interest | (0.2) | — | — | — | — | — | (0.2) | ||||||||||||||||||||||||||||||||||
Net income attributable to LAD | $ | 228.7 | $ | (5.3) | $ | 0.5 | $ | 0.1 | $ | 1.1 | $ | 7.4 | $ | 232.5 | |||||||||||||||||||||||||||
Diluted earnings per share attributable to LAD | $ | 8.30 | $ | (0.19) | $ | 0.02 | $ | — | $ | 0.04 | $ | 0.27 | $ | 8.44 | |||||||||||||||||||||||||||
Diluted share count | 27.5 |
Three months ended March 31, | % | |||||||||||||||||||
Increase | ||||||||||||||||||||
2024 | 2023 | (Decrease) | ||||||||||||||||||
EBITDA and Adjusted EBITDA | ||||||||||||||||||||
Net income | $ | 165.0 | $ | 229.6 | (28.1) | % | ||||||||||||||
Flooring interest expense | 60.7 | 27.7 | 119.1 | |||||||||||||||||
Other interest expense | 63.6 | 39.0 | 63.1 | |||||||||||||||||
Financing operations interest expense | 47.8 | 37.5 | 27.5 | |||||||||||||||||
Income tax expense | 55.6 | 84.7 | (34.4) | |||||||||||||||||
Depreciation and amortization | 57.8 | 47.3 | 22.2 | |||||||||||||||||
Financing operations depreciation expense | 18.0 | 2.3 | 682.6 | % | ||||||||||||||||
EBITDA | $ | 468.5 | $ | 468.1 | 0.1 | % | ||||||||||||||
Other adjustments: | ||||||||||||||||||||
Less: flooring interest expense | $ | (60.7) | $ | (27.7) | 119.1 | |||||||||||||||
Less: financing operations interest expense | (47.8) | (37.5) | 27.5 | |||||||||||||||||
Less: used vehicle line of credit interest | (6.2) | (1.5) | 313.3 | |||||||||||||||||
Add: acquisition expenses | 7.7 | 1.3 | 492.3 | |||||||||||||||||
Less: loss (gain) on divestitures |
— | (7.2) | NM | |||||||||||||||||
Add: investment loss |
— | 0.5 | NM | |||||||||||||||||
Add: insurance reserves | — | 0.1 | NM | |||||||||||||||||
Add: contract buyouts |
— | 10.1 | NM | |||||||||||||||||
Adjusted EBITDA | $ | 361.5 | $ | 406.2 | (11.0) | % | ||||||||||||||
As of | % | |||||||||||||||||||
March 31, | Increase | |||||||||||||||||||
Net Debt to Adjusted EBITDA | 2024 | 2023 | (Decrease) | |||||||||||||||||
Floor plan notes payable: non-trade | $ | 2,428.7 | $ | 1,664.9 | 45.9 | % | ||||||||||||||
Floor plan notes payable | 2,533.3 | 999.3 | 153.5 | |||||||||||||||||
Used and service loaner vehicle inventory financing facility | 912.7 | 843.6 | 8.2 | |||||||||||||||||
Revolving lines of credit | 1,610.5 | 1,012.4 | 59.1 | |||||||||||||||||
Warehouse facilities | 636.0 | 875.0 | (27.3) | |||||||||||||||||
Non-recourse notes payable | 1,831.5 | 825.4 | 121.9 | |||||||||||||||||
4.625% Senior notes due 2027 | 400.0 | 400.0 | — | |||||||||||||||||
4.375% Senior notes due 2031 | 550.0 | 550.0 | — | |||||||||||||||||
3.875% Senior notes due 2029 | 800.0 | 800.0 | — | |||||||||||||||||
Finance leases and other debt | 880.6 | 651.5 | 35.2 | |||||||||||||||||
Unamortized debt issuance costs | (30.2) | (30.6) | (1.3) | |||||||||||||||||
Total debt | $ | 12,553.1 | $ | 8,591.5 | 46.1 | % | ||||||||||||||
Less: Floor plan related debt | $ | (5,874.7) | $ | (3,507.8) | 67.5 | % | ||||||||||||||
Less: Financing operations related debt | (2,467.5) | (1,700.4) | 45.1 | |||||||||||||||||
Less: Unrestricted cash and cash equivalents |
(264.4) | (184.9) | 43.0 | |||||||||||||||||
Less: Marketable securities |
(49.9) | — | — | |||||||||||||||||
Less: Availability on used vehicle and service loaner financing facilities | (31.7) | (5.9) | 437.3 | |||||||||||||||||
Net Debt | $ | 3,864.9 | $ | 3,192.5 | 21.1 | % | ||||||||||||||
TTM Adjusted EBITDA | $ | 1,721.4 | $ | 1,875.0 | (8.2) | % | ||||||||||||||
Net debt to Adjusted EBITDA | 2.25 | x | 1.70 | x |