Slide 1: Q4 2021 & Annual Earnings Slides
Q4 2021 & Annual Earnings Slides February 16, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward looking statements are based on management’s current expectations, are not guarantees of future performance and are subject t
Slide 3: Fourth Quarter Summary
Fourth Quarter Summary ❑ KAR Financial Performance o Consolidated revenue of $549.4M ($454.8M excluding purchased vehicles) o Gross profit of $226.2M was 49.7% of net revenue1 o SG&A of $134.8 o Adjusted EBITDA of $97.9M o Cash flow from operations $60.6M o Operating adjusted EPS of $0.11 – includes
Slide 4: Fourth Quarter & Year-to-Date Results
F o u r t h Q u a r t e r & Ye a r - t o - D a t e Results 4
Slide 5: KAR 2021 Highlights
KAR 2021 Highlights* ($ in millions, except per share amounts) KAR Q4 2021 Q4 2020 YTD 2021 YTD 2020 Total operating revenues $549.4 $529.6 $2,251.6 $2,187.7 Gross profit** $226.2 $204.2 $951.7 $902.9 % of revenue** 41.2% 38.6% 42.3% 41.3% SG&A $134.8 $139.7 $558.1 $545.4 Other (income) expense, net
Slide 6: ADESA 2021 Highlights
ADESA 2021 Highlights* ($ in millions, except RPU) ADESA Q4 2021 Q4 2020 YTD 2021 YTD 2020 Auction fees $207.4 $207.0 $877.8 $887.7 Service revenue $168.2 $173.5 $707.2 $737.4 Purchased vehicle sales $94.6 $83.7 $377.4 $295.0 Total ADESA Revenue $470.2 $464.2 $1,962.4 $1,920.1 Gross profit** $161.4
Slide 7: AFC 2021 Highlights
AFC 2021 Highlights* ($ in millions, except for revenue per loan transaction) AFC Q4 2021 Q4 2020 YTD 2021 YTD 2020 Interest and fee income $76.1 $61.4 $284.1 $266.1 Other revenue $2.2 $1.9 $8.6 $8.7 Net recovery (provision) for credit losses $0.9 ($2.7) ($3.5) ($38.6) Warranty contract revenue $--
Slide 8: December 31, 2021 Leverage
December 31, 2021 Leverage (US$ in millions) Balance Maturity Term Loan B-6 (Adjusted LIBOR + 2.25%) $929 2026 Revolving Credit Facility (Adjusted LIBOR + 1.75%) - 2024 Senior Notes (Fixed 5.125%) 950 2025 Finance Leases & Other 18 Total 1,897 Less: Available Cash* (175) Net Debt $1,722 Senior Secur
Slide 9: Historical Data
AUCTION SERVICES. HISTORICAL DATA
Slide 10: ADESA Revenue
ADESA Revenue 2021 4Q21 3Q21 2Q21 1Q21 2020 4Q20 3Q20 2Q20 1Q20 Auction Fees $877.8 $207.4 $198.2 $236.7 $235.5 $887.7 $207.0 $247.6 $177.8 $255.3 Service Revenue $707.2 $168.2 $169.2 $182.2 $187.6 $737.4 $173.5 $192.9 $134.8 $236.2 Purchased Vehicle $377.4 $94.6 $92.2 $97.9 $92.7 $295.0 $83.7 $86.2
Slide 11: ADESA Metrics - Annual
ADESA Metrics - Annual 2021 2020 2019 2018 2017 Revenue1 $1,962.4 $1,920.1 $2,429.0 $2,101.9 $1,937.5 Commercial vehicles sold 1,503 2,265 2,726 2,446 2,148 Dealer consignment vehicles sold 1,090 797 1,058 1,026 1,032 Total vehicles sold 2,593 3,062 3,784 3,472 3,180 Auction fees per vehicle sold $3
Slide 12: ADESA Metrics - Quarter
ADESA Metrics - Quarter 4Q21 3Q21 2Q21 1Q21 4Q20 3Q20 2Q20 1Q20 Revenue1 $470.2 $459.6 $516.8 $515.8 $464.2 $526.7 $362.2 $567.0 Commercial vehicles sold 266 312 420 505 474 642 511 638 Dealer consignment 277 274 291 248 207 229 137 224 vehicles sold Total vehicles sold 543 586 711 753 681 871 648 8
Slide 13: AFC Metrics - Annual
AFC Metrics - Annual 2021 2020 2019 2018 2017 Revenue $289.2 $267.6 $352.9 $340.9 $301.3 Loan Transaction Units (LTU) 1,421 1,519 1,783 1,760 1,688 Revenue per Loan Transaction, Excluding $204 $156 $178 $175 $159 Warranty Contract Revenue Ending Managed Finance Receivables $2,529.0 $1,911.0 $2,115.2
Slide 14: AFC Metrics - Quarter
AFC Metrics - Quarter 4Q21 3Q21 2Q21 1Q21 4Q20 3Q20 2Q20 1Q20 Revenue $79.2 $75.6 $68.6 $65.8 $65.4 $66.9 $56.8 $78.5 Loan Transaction Units (LTU) 342 351 356 372 327 324 420 448 Revenue per Loan Transaction, Excluding Warranty Contract $232 $215 $193 $177 $186 $179 $115 $155 Revenue Ending Managed
Slide 15: AFC Provision for Credit Losses - Annual
AFC Provision for Credit Losses - Annual 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Ending Managed $2,529.0 $1,911.0 $2,115.2 $2,014.8 $1,912.6 $1,792.2 $1,641.0 $1,371.1 $1,107.6 $1,004.2 $883.2 $771.6 $613.0 $506.6 Receivables Average Managed $2,145.0 $1,854.8 $2,059.9 $
Slide 16: AFC Provision for Credit Losses - Quarterly
AFC Provision for Credit Losses - Quarterly 4Q21 3Q21 2Q21 1Q21 4Q20 3Q20 2Q20 1Q20 Ending Managed $2,529.0 $2,191.7 $2,108.9 $1,984.4 $1,911.0 $1,744.8 $1,548.3 $1,954.8 Receivables Average Managed $2,360.4 $2,150.3 $2,046.7 $1,947.7 $1,827.9 $1,646.6 $1,751.6 $2,035.0 Receivables Net (Recovery) Pr
Slide 17: Appendix
AUCTION SERVICES. APPENDIX
Slide 18: Non-GAAP Financial Measures
Non-GAAP Financial Measures EBITDA is defined as net income (loss), plus interest expense net of interest income, income tax provision (benefit), depreciation and amortization. Adjusted EBITDA is EBITDA adjusted for the items of income and expense and expected incremental revenue and cost savings as
Slide 19: Q4 2021 Adjusted EBITDA Reconciliation
Q4 2021 Adjusted EBITDA Reconciliation ($ in millions) Three Months ended December 31, 2021 ADESA AFC Consolidated Net income (loss) ($23.9) $29.0 $5.1 Add back: Income taxes (5.9) 9.4 3.5 Interest expense, net of interest income 21.5 10.5 32.0 Depreciation and amortization 43.6 2.3 45.9 Intercompan
Slide 20: Q4 2020 Adjusted EBITDA Reconciliation
Q4 2020 Adjusted EBITDA Reconciliation ($ in millions) Three Months ended December 31, 2020 ADESA AFC Consolidated Net income (loss) ($38.5) $21.4 ($17.1) Add back: Income taxes (9.7) 6.3 (3.4) Interest expense, net of interest income 21.5 8.8 30.3 Depreciation and amortization 47.7 2.9 50.6 Interco
Slide 21: YTD 2021 Adjusted EBITDA Reconciliation
YTD 2021 Adjusted EBITDA Reconciliation ($ in millions) Year ended December 31, 2021 ADESA AFC Consolidated Net income (loss) ($58.9) $125.4 $66.5 Add back: Income taxes (6.5) 41.5 35.0 Interest expense, net of interest income 86.2 39.5 125.7 Depreciation and amortization 173.6 9.4 183.0 Intercompan
Slide 22: YTD 2020 Adjusted EBITDA Reconciliation
YTD 2020 Adjusted EBITDA Reconciliation ($ in millions) Year ended December 31, 2020 ADESA AFC Consolidated Net income (loss) ($79.1) $79.6 $0.5 Add back: Income taxes (17.0) 21.9 4.9 Interest expense, net of interest income 88.3 39.0 127.3 Depreciation and amortization 178.8 12.5 191.3 Intercompany
Slide 23: Operating Adjusted Net Income per Share Reconciliation
Operating Adjusted Net Income per Share Reconciliation ($ in millions, except per share amounts), (unaudited) Three Months ended Year ended December 31, December 31, 2021 2020 2021 2020 Net income (loss)(1) $5.1 ($17.1) $66.5 $0.5 Acquired amortization expense 13.0 15.3 54.6 57.7 Contingent consider