Asbury Automotive Group Inc · NYSE:ABG
Asbury Automotive — Q3 2022 Earnings Presentation
35 slides from Asbury Automotive's earnings presentation, Oct 27, 2022
Slide 1: Investor Relations Presentation
Oct 2022 INVESTOR RELATIONS PRESENTATION NYSE: ABG | Asbury Automotive
Slide 2: Forward Looking Statements
This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical fact, and may include statements relating to goals, plans, objectives, projections regarding Asbury's fi
Slide 3: gest CENTRIC Aur
gest CENTRIC Aur re) KAHLO A? Mo, we %, (H clicklane & e 7 x %, &» McDavid & Z STEVINSON = 2 3 ® PLAZA MOTORS | NALEY TEAM MEMBERS AUTOMOTIVE FUN | SUPPORTIVE | THRIVE BOND | CULTURE ARAPAHOE ASBURY AUTOMOTIVE GROUP. OUR NORTH STAR A.LarryH Miller GUESTS Dealerships CARING | LOVE | STRIVE PROFESSION
Slide 4: Our Agenda
Our Agenda October 27, 2022 01 Company Highlights 02 Third Quarter 2022 Review 03 Growth Strategy 04 Appendix 4
Slide 5: Company Highlights
COMPANY HIGHLIGHTS ABG | Asbury Automotive 5
Slide 6: Company Highlights
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Company Highlights $27.29 $28.54 Since 2017, Asbury has(1) $11.73B 82% increase in revenue $12.90 $9.84B $9.46 344% increase in Adj EPS $8.41 $6.43 $7.21B $7.13B $6.46B $6.87B 85% increase in new dealer rooftops 155 148 Adj EPS Revenue Adj EBITDA ($MM) ($MM) 80 8
Slide 7: Company Highlights
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Company Highlights 1 WA Total Care Auto Integrated F&I 4 ID Product Provider 21 9 21 2 UT 6 4 $15 BILLION IN CA CO VA Total Revenue(1) MO 9 12 6 5 NC AZ NM 5TH LARGEST(2) 17 SC Automotive Retailer 14 GA TX 24 1.9X FL Adjusted Net Leverage(3,4) $1.2B Available Liq
Slide 8: Attractive Brand Mix
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Attractive Brand Mix A diversified portfolio with the right brands in the right markets (Based on New Vehicle Revenue – YTD 3Q22) Luxury Imports Lexus 9% Toyota 17% Mercedes-Benz 8% Honda 9% Luxury Domestic BMW 3% Hyundai 5% 31% 30% Acura 2% Nissan 3% Porsche 2%
Slide 9: The Four Key Components
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX The Four Key Components Diversified business mix provides multiple profit streams that are independent of SAAR (YTD 3Q22) 5% F&I, includes TCA 13% 24% Parts & Service Independent Used of SAAR 34% New 37% 12% 47% 27% Revenue Gross Profit May not add to 100% due to
Slide 10: ESG Impact
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX ESG Impact We have dedicated significant resources toward enhancing our ESG impact Minimizing Impact on the Environment Recycling – cardboard, glass, plastic, motor oil, tires Reclaiming – water in car washes Reducing – water usage, energy through motion sensors
Slide 11: Third Quarter 2022
THIRD QUARTER 2022 ABG | Asbury Automotive 11
Slide 12: Summary
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Summary Q3 2022 Year-Over-Year Growth Revenue Strategic Highlights Total Company Same Store Delivered record third quarter adjusted EPS Total 61% (3%) and EBITDA Sold over 6,800 vehicles via Clicklane, our New Vehicle 59% (7%) fully transactional online tool Gene
Slide 13: Operating Income & Margin Trend
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Operating Income & Margin Trend We consistently deliver best in class operating efficiency 8.3% Adj. Operating Margin 8.1% 7.7% 5.7% Increased year to date: 4.6% • adjusted operating income by $969 $413 million or 74% and • adjusted operating margin by 50 bps $79
Slide 14: Cash Flow Summary
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Cash Flow Summary As a larger company with more robust operating cash flow, we have increased capacity for capital deployment $34.84 Adj. Operating Cash $31.43 Flow per Share $782 $22.93 $21.66 $719 Increased year to date: • adjusted operating cash $14.63 $632 fl
Slide 15: Growth Strategy Update
GROWTH STRATEGY UPDATE ABG | Asbury Automotive 15
Slide 16: Our Strategy
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Our Strategy Two fundamental principles to drive shareholder value Leverage scale Capital and cost investments in structure existing dealerships Maintain best-in- class operating Acquire dealerships Operational Capital margins through meeting our continuous effic
Slide 17: 2025 Growth Plan
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX In 2025: >$55/Share EPS CAGR of >31%(2) Resulting <1.0x $6.2B ~$32B 2025 Growth Plan Leverage We are working towards achieving our Acquisitions $7.4B 5-year plan goal of $32 billion in revenue by 2025. Clicklane Robust $3.1B pipeline of 4x We continue to expand o
Slide 18: A Digital Experience
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX A Digital Experience Clicklane provides a full digital ecosystem for every aspect of car ownership Buying Buy a car 100% online. Finance, trade, protect and sign all online Ownership Unified ecosystem designed to offer all aspects of a guest's vehicle lifecycle S
Slide 19: 2025 Plan: Clicklane
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX 2025 Plan: Clicklane Multiple growth drivers deliver significant revenue for Clicklane $8.0B Revenue Expanding Clicklane Current volume limited by inventory shortages. Planned advertising campaigns are delayed until inventory recovers. Future growth drivers $2.2B
Slide 20: Key Clicklane Statistics
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Key Clicklane Statistics A fast, efficient process that delivers value to our guests and shareholders 6,817 36% $5.5K Actual Volume New Cars Total Front-End Yield 3Q22 sales volume Total Front-End PVR $3,450 F&I PVR $2,093 91% 14 95% Lender Approval Avg Minutes D
Slide 21: Total Care Auto
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Total Care Auto TCA is a stand-alone insurance company fully integrated with our dealerships that provides a new profit stream for Asbury Vehicle Sold (Dealership) Vehicle Service Contracts Key & Remote Replacement • Extensive list of vehicle parts and • 24-hour
Slide 22: Total Care Auto
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Total Care Auto Integrated insurance provider increasing profitability through ownership of the full guest experience $185M+ EBITDA $140M+ Seasoned and experienced management team built for growth Integration with Clicklane provides further opportunity for growth
Slide 23: 2025 Plan: Used Vehicles
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX 2025 Plan: Used Vehicles How we plan to grow our used vehicle sales through 2025 Proprietary software utilized for strategic 130 inventory management resulting in faster Used Vehicles turns and higher margins per Month per Rooftop Clicklane has proven to be a fas
Slide 24: 2025 Plan: Parts & Service
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX 2025 Plan: Parts & Service Technology enables productivity and transparency driving higher $s per repair order Focus on technology to drive employee Increase service retention through our level productivity of service and utilizing technology • Online appointment
Slide 25: Appendix
APPENDIX ABG | Asbury Automotive 25
Slide 26: Capital Allocation History
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Capital Allocation History We have a track record of prudent capital allocation YTD ‘14-’17 2018 2019 2020 2021 3Q22 Acquisitions $615M Revenue Acquired $220M Revenue Acquired $425M Revenue Acquired $1.8B Revenue Acquired $5.8B(2) Revenue Acquired N/A ▪ Dealershi
Slide 27: Leverage Varies Based on Business Conditions & Environment
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Leverage Varies Based on Business Conditions & Environment Equilibrium leverage target range balances financial flexibility with an efficient capital structure 2.5x Normal Target Range 3.0x NET DEBT/EBITDA Factors Influencing Leverage Top ECONOMIC CYCLE Bottom Hi
Slide 28: Debt Maturity Schedule
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Debt Maturity Schedule Our near-term obligations remain minimal with no significant maturities until 2025 ($ in Millions) $669 Senior Notes Mortgages $800 $600 $405 $445 $175 $25 $35 $106 $8 $78 $8 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Note: Date
Slide 29: Non-GAAP Financial Disclosure
In addition to evaluating the financial condition and results of our operations in accordance with GAAP, from time to time management evaluates and analyzes results and any impact on the Company of strategic decisions and actions relating to, among other things, cost reduction, growth, and profitabi
Slide 30: Non-GAAP Reconciliation: Adjusted Income from Operations
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Non-GAAP Reconciliation Adjusted income from Operations and Adjusted Operating Margin 30 NYSE: ABG
Slide 31: Non-GAAP Reconciliation: Adjusted EBITDA
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Non-GAAP Reconciliation Adjusted EBITDA 31 NYSE: ABG
Slide 32: Non-GAAP Reconciliation: Adjusted Net Income and EPS
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Non-GAAP Reconciliation Adjusted Net Income and Adjusted EPS 32 NYSE: ABG
Slide 33: Non-GAAP Reconciliation: Pro Forma Adjusted Net Leverage
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Non-GAAP Reconciliation Pro Forma Adjusted Net Leverage Ratio 33 NYSE: ABG
Slide 34: Non-GAAP Reconciliation: Adjusted Cash Flow from Operations
HIGHLIGHTS QUARTER 3 GROWTH APPENDIX Non-GAAP Reconciliation Adjusted Cash Flow from Operations 34 NYSE: ABG
Slide 35: Thank You
Thank You https://www.asburyauto.com 35
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