Avis Budget Group, Inc. · NASDAQ:CAR
Avis Budget — Q1 2018 Earnings Presentation
20 slides from Avis Budget's earnings presentation, May 3, 2018
Slide 1: 2018 First Quarter Earnings Call
2018 FIRST QUARTER EARNINGS CALL May 3, 2018 Webcast: ir.avisbudgetgroup.com Dial-in: (630) 395.0021 Replay: (203) 369-3463 Passcode: 2995545
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Statements about future results made in this presentation constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include projections. These statements are based on current expectatio
Slide 3: First Quarter Highlights
FIRST QUARTER HIGHLIGHTS • Strong global volume growth • Very strong leisure rates during peak periods • Lower fleet costs in the Americas • Higher utilization in both the Americas and International regions • Benefits from our strategic initiatives 3
Slide 4: First Quarter Results
FIRST QUARTER RESULTS Revenue Adjusted EBITDA $1,968 $2 2017 $1,839 7% 2018 2017 2018 ($27) Reconciliation of net income (loss) to Adjusted EBITDA can be found on slide A-3 of this presentation All $ amounts in millions 4
Slide 5: Strategic Initiatives
STRATEGIC INITIATIVES Demand-Fleet- • Integrated system now live in 14 markets in the Americas Pricing System • Driving higher revenue and pricing in these markets Web and Mobile • 45% of Budget bookings on our platforms were prepaid Platforms • Customers have used Avis app well over one million tim
Slide 6: Advances in Mobility
ADVANCES IN MOBILITY Innovating with new Zipcar products • “Flex” expanding to additional London boroughs • “Commuter” grew quarter-over-quarter revenue double-digits Driving efficiencies through Connected Car • Connected car fleet increased to 65,000 vehicles • Initial cost benefits from more accur
Slide 7: 2018 Outlook
2018 OUTLOOK Strong global demand and stable fleet costs Normalized industry fleet levels resulting in tighter peak periods Investing in technology to lower costs 7
Slide 8: Americas First Quarter Results
AMERICAS FIRST QUARTER RESULTS • Revenue growth driven by higher volumes • Total revenue per day unchanged due to lower ancillary revenue and Robust demand around loyalty accounting seasonal peaks drove 4% improvement in leisure Pricing under historical T&M per day metric improved by 2% pricing •
Slide 9: Americas Fleet Costs
AMERICAS FLEET COSTS Monthly Per-Unit Fleet Costs Alternative Disposition Channels 55% $335 $323 (4%) 45% 10 ppts First Quarter First Quarter First Quarter First Quarter 2017 2018 2017 2018 9
Slide 10: International First Quarter Results
INTERNATIONAL FIRST QUARTER RESULTS • Revenue increase resulting from 11% commercial volume growth • Total revenue per day was 2% lower in local currency Pricing under historical T&M per day metric improved by 1% in local currency Deployment of DFP robotic driving pricing benefits • Adjusted EBI
Slide 11: Strong Cash Flow and Funding Position
STRONG CASH FLOW AND FUNDING POSITION • $3.9 billion of available liquidity We expect our leverage • Corporate leverage of 4.0x, no maturities until 2022 ratio to progressively • First lien covenant ratio more than a full turn below maximum ease down over the of 2.5x course of the year Corporate Deb
Slide 12: Reiterating 2018 Adjusted Earnings Outlook
REITERATING 2018 ADJUSTED EARNINGS OUTLOOK Year-over-Year (in millions, except EPS) Full-Year Projection Growth Total Revenue $9,200 – 9,450 [3-6%] 5% Adjusted EBITDA 740 – 820 [1-10%] 6% Non-vehicle D&A 210 [4%] 4% Interest expense 200 [6%] 6% Adjusted pretax income 330 – 410 [(5%)-16%] 7% Adjusted
Slide 13: Reiterating 2018 Adjusted Free Cash Flow Outlook
REITERATING 2018 ADJUSTED FREE CASH FLOW OUTLOOK Full-Year Projection (in millions) Adjusted pretax income $330 – 410 Plus: Non-vehicle D&A 210 Less: Capex (220) Less: Cash taxes (45) – (55) Plus: Vehicle programs, 30 – 50 Working capital and other Adjusted Free Cash Flow $325-375 All figures are ap
Slide 14: Summary
SUMMARY • Strong first quarter driven by: Robust global volume growth Improved per-unit fleet costs Higher utilization • Industry pricing and fleet costs stabilized • Initiatives driving profitable revenue growth and cost savings • Margin improved 160 basis points year-over-year 14
Slide 15: Avis Budget Group
avis budget group
Slide 16: Appendix
APPENDIX
Slide 17: 2018 Currency Outlook
2018 CURRENCY OUTLOOK (in millions) First Second Third Fourth Full Year Quarter Quarter Quarter Quarter 2018 Revenue $63 $70-77 $35-42 $22-28 $190-210 Adjusted EBITDA $6 $13-16 $6-11 $0-2 $25-35 (net of hedging) Expect a $25 - $35 million year-over-year Adjusted EBITDA benefit A-1
Slide 18: Definitions
DEFINITIONS This presentation includes certain non-GAAP (generally accepted accounting principles) financial measures as defined under SEC rules. We have provided below reasons why we present these non- GAAP financial measures, a description of what they represent and a reconciliation to the most co
Slide 19: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of net loss to Adjusted net loss (in millions, except per-share amounts): Three Months Ended March 31, 2018 2017 Net loss $ (87) $ (107) Add certain items, net of tax: Acquisition-related amortization expense 9 9 Non-operational charges related to
Slide 20: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of net corporate debt (in millions): March 31, 2018 Corporate debt $ 3,607 Less: Cash and cash equivalents 544 Net corporate debt $ 3,063 Last Twelve Months ended Reconciliation of net income to Adjusted EBITDA (in millions): March 31 2018 Net inco