Slide 1: AutoCanada Investor Presentation August 2023
AUTOCANADA (TSX:ACQ) INVESTOR PRESENTATION AUGUST 2023
Slide 2: Forward-Looking Statements and Non-GAAP and Other Financial Measures
Forward-Looking Statements and Non-GAAP and Other Financial Measures Forward-Looking Statement Certain statements contained in this presentation are forward-looking statements and information (collectively “forward-looking statements”), within the meaning of the applicable Canadian securities legisl
Slide 3: Who We Are
WHO WE ARE
Slide 4: AutoCanada Overview
AutoCanada Overview A Leading Multi-Location Automobile Dealership Group At a Glance1 65 18 • One of Canada’s largest multi-location automobile OEM Franchises in Canada2 OEM Franchises in Illinois, U.S. dealership groups with ~6,000 employees • Only publicly listed auto dealership group in Canada 15
Slide 5: Revenue Diversity Across Brands and Geographies
Revenue Diversity Across Brands and Geographies AUTOCANADA CANADIAN REVENUE MIX1 % of AutoCanada Revenue by Region 1 Segment Segment % Brand Brand Revenue % Acura 1% Honda 5% Hyundai 9% BC AB Infiniti 1% 9.8% 26.5% SK MB Import 31% Kia 2% 6.4% 6.6% Mazda 1% QC Nissan 5% ON 23.8% 10.4% ATL Subaru 1%
Slide 6: Investment Highlights
Investment Highlights Large and Highly Fragmented Canadian Market with Significant Resilient Business Model Strong Stewards of Capital Consolidation Opportunities Accelerated Growth Through Complete Business Model First Mover Advantage Significant Organic Experienced with Canadian Growth Opportuniti
Slide 7: Serving the $198 billion + Market
Large and Highly Fragmented Market – Ample Opportunity for Consolidation > 3,700 Dealerships in Canada AutoCanada NEW 2% VEHICLE MARKET Other Dealers 98% Serving the 1.6 Million New Vehicles 3.1 Million Used Vehicles $198 billion + Market USED Private Franchised New VEHICLE Parties 33.0% Car Dealers
Slide 8: Profitable Product Mix & Diverse Earnings Streams Provide Stability
Profitable Product Mix & Diverse Earnings Streams Provide Stability Complete Business Model Facilitates Higher Margin F&I and PS&CR Sales New Used PS&CR F&I • New car sales are local monopolies that have averaged ~ 2.0% unit sales growth over the long term 19% • Used car sales offer bricks and 32% m
Slide 9: Growth Pillars
Growth Pillars Strategic Growth Initiatives Driving Industry-Leading Performance GROWTH PILLARS Used Parts & Finance & Vehicles Services Collision M&A U.S. Insurance Data Analytics 9
Slide 10: Increasing Used Vehicles Sales
Increasing Used Vehicles Sales Industry Leader in Canada • Counter-cyclical to new vehicle sales; no OEM constraints on market share growth; omni-channel strategy • Creates opportunities to capture high margin sales in F&I and PS&CR 2 • Canadian market used to new retail unit ratio2 was 0.7 in 20211
Slide 11: RightRide / Used Digital
RightRide / Used Digital Significant Organic Growth Opportunities RightRide offers ability to offer attractive financing products to credit Used Digital strategy complementary to existing Complete challenged customers (sub and near prime) Business Model o No credit risk retained by AutoCanada • Omni
Slide 12: Parts & Service
Parts & Service Significant Organic Growth Opportunities • Leverage centralized call centre (Business Development Centre or “BDC”) Same Store1 Quarterly Parts, Service & Collision Repair to handle all inbound and outbound service work appointment bookings Gross Profit ($M) • Management focus on effe
Slide 13: Collision Centre Expansion
Collision Centre Expansion Currently 27 locations across Canada with Opportunity to Meaningfully Expand Network • Strategy prioritizes access to OEM repair procedures, OEM certifications and OEM parts procurement • Large, fragmented and mature market which benefits consolidator • Dedicated leadershi
Slide 14: Drive Growth Through Optimization of Finance & Insurance
Drive Growth Through Optimization of Finance & Insurance Resilienc y Leading F&I GPU across North America • Dedicated and focused F&I team leading efforts across all dealerships Same Store1 Quarterly F&I Gross Profit ($M) • F&I amplifies gross margin contributions from New and Used Vehicle sales 66.
Slide 15: Generated $167M of Free Cash Flow Q2 2023 TTM
Generated $167M of Free Cash Flow Q2 2023 TTM Total Net Funded Debt to Bank EBITDA Leverage Ratio of 2.08x DISCIPLINED MANAGEMENT OF LEVERAGE TOTAL NET FUNDED DEBT Q2 2023 ($M) Revolving term facility - Credit Facility 143.7 Senior Unsecured Notes 345.0 Other funded debt according to Credit Facility
Slide 16: Capital Allocation Strategy
Capital Allocation Strategy Strong Stewards of Capital • AutoCanada capital allocation aligned with business strategy, growth opportunities and free cash flow profile CAPITAL ALLOCATION PRIORITIES Organic Growth / Internal M&A / Strategic Liability Management Return to Shareholders Investment Partne
Slide 17: Well Positioned for Industry Consolidation Through Disciplined M&A Strategy
Well Positioned for Industry Consolidation Through Disciplined M&A Strategy Significant Consolidation Opportunities Acquisitions are a key part of • Advance and actively assess strategic acquisition capital allocation strategy opportunities and develop a robust acquisition pipeline Disciplined appro
Slide 18: Recent Acquisitions
Recent Acquisitions Executing on Robust Pipeline of Opportunities Date Company Location Type Description May 2022 Audi Windsor and Porsche of London Ontario Dealerships • Adds 2 dealerships, geographic diversification and adds Porsche to Canada Jun. 2022 Burwell Auto Body London, ON Collision • Expa
Slide 19: Management Team With Proven Track Record Driving Vision & Strategy
Management Team With Proven Track Record Driving Vision & Strategy Recently Expanded Leadership Team v Peter Hong Jeffrey Thorpe Paul Antony Azim Lalani Chief Strategy Officer & General President, Canadian Operations Executive Chairman Chief Financial Officer Counsel Joined April 2022 Joined May 201
Slide 20: Environment, Social & Governance (ESG) Overview
Environment, Social & Governance (ESG) Overview Focus on areas that positively impact our business and society • We are committed to responsible business practices and driving continuous improvement of our operations and our relationships with our employees and the communities in which we live and w
Slide 21: In Conclusion – Key Takeaways
In Conclusion – Key Takeaways • We have executed well on building out our ‘Complete’ Business Model o Progress on initiatives to grow New, Used, F&I, and PS&CR driving resiliency o Able to deliver top decile performance in any economic environment • Strengthened balance sheet, strong cash flow and c
Slide 22: Q2 2023 Results
Q2 2023 RESULTS
Slide 23: Q2 2023 Results Overview
Q2 2023 Results Overview Record Results Across Various Operational Segments • Revenue was $1,756.3 million as compared to $1,686.0 million in the prior year, an increase of 4.2% • Total retail vehicles sold of 28,479 units, an increase of 861 units or 3.1% • Used to new retail units ratio1 was 1.53
Slide 24: Q2 2023 Results Continued
Q2 2023 Results Continued Second Quarter Results ($M, unless otherwise noted) Q2 2023 Q2 2022 Change Consolidated Revenue 1,756.3 1,686.0 +4% Gross Profit %1 18.1% 16.6% +1.6 ppts Adjusted EBITDA1 94.1 75.6 +24% Adjusted EBITDA1% 5.4% 4.5% +0.9 ppts Same Store Used to New Ratio1 1.56 1.70 -14% Total
Slide 25: Q2 2023 Results Continued
Q2 2023 Results Continued Operations Results – Higher New and Used Vehicle Retail Sales & F&I Key Drivers CONSOLIDATED ADJUSTED EBITDA1 ($M) 4.7% 5.4% 4.5% 3.6% 2.9% 94.1 TTM Consolidated Adjusted EBITDA1 $266.1 million 75.6 76.4 50.7 TTM Canadian Operations Adjusted EBITDA1 $246.9 million 45.0 -2.2
Slide 26: Appendix
APPENDIX
Slide 27: Dealership Locations and Brands
Dealership Locations and Brands Geographic and Brand Diversification – AutoCanada Owns Some of the Best Performing Dealerships in Canada 2022 & 2023 YTD Awards British Columbia Alberta Abbotsford Volkswagen Airdrie Dodge Fish Creek Nissan Grande Prairie Volkswagen Ponoka Chrysler Award Dealership/Co
Slide 28: Thank You
AUTOCANADA THANK YOU INVESTORS.AUTOCAN.CA