Slide 1: First Quarter 2024 Earnings Release
First Quarter 2024 Earnings Release April 26, 2024 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be dee
Slide 3: 1Q 2024 Overview
1Q 2024 Overview TOTAL STORE PERFORMANCE COMMENTS New Vehicle unit growth + 7% • New unit growth led by imports Used Vehicle unit growth + 2% • New PVRs in line with expectations • Used units higher while navigating tight supply Customer Financial Services #1 • Opened 4 AN USA locations in existing
Slide 4: Financial Summary
1Q 2024 Financial Summary ($ in millions, except per share data) Q1 2023 Q1 2024 YoY COMMENTS Growth highlighted by new vehicle volumes and Total Revenue $6,399 $6,486 1% After-Sales Gross Profit $1,286 $1,198 -7% 18.5% Gross Profit Margin Adj. SG&A Expense $778 $786 1% Stable core SG&A, investing f
Slide 5: New Vehicles
1Q 2024 New Vehicles RETAIL UNITS & PVR NOTES 58,863 • Units in line with overall market and up 7% 55,065 YoY • Imports up 19%, Domestic approximately flat, Premium Luxury down 4% $5,210 • Sequential PVR moderation of $325 in line with expectations and reflects changes in: • Segment Mix $3,328 • ASP
Slide 6: Used Vehicles
1Q 2024 Used Vehicles RETAIL UNITS & PVR NOTES • Units up 2% from 1Q 23 69,121 • Units up sequentially 6%, Gross PVRs up 67,539 slightly from 4Q 23 • Volume and PVR impacted by: $2,117 • Pricing band mix • Inventory optimization • Stabilizing vehicle value trends $1,473 • Inventory remains limited i
Slide 7: Customer Financial Services
1Q 2024 Customer Financial Services GROSS PROFIT ($M) & GROSS PROFIT PVR NOTES $332 $335 • Industry leading CFS performance continues • Robust product attachment, finance $2,711 penetration for new vehicles $2,615 • Modest PVR decline reflects: • Shift to AN Finance (higher lifetime profit) • Elevat
Slide 8: After Sales
1Q 2024 After Sales REVENUE ($M) & GROSS PROFIT ($M) NOTES $1,173 • Revenue growth of 8%, gross profit growth of 9% $1,090 • Value per repair order improving $556 $511 • Volume of repair orders increasing • Increases in Internal, Warranty, Customer Pay • Gross Profit margin of 47.4%, up ~50 bps • Fo
Slide 9: Operating Income
1Q 2024 Operating Income ADJ OPERATING INCOME MARGIN (%) NOTES 7.0% • Margin ~150 bps above pre-pandemic levels 5.4% • Moderation of vehicle gross profit and growth investments • SG&A growth reflects: • Investments for growth • Advertising to support used vehicle acquisitions • Normalized SG&A / Gro
Slide 10: Free Cash Flow
1Q 2024 Free Cash Flow ADJ FCF ($M) & CONVERSION % NOTES $368 • Continued attractive cash conversion profile $257 • Sharpened focus on cycle times (e.g. billing, time-to-auction, and service WIP) 127% 135% • Capital investments in-line with prior year 1Q 23 1Q 24 Refer to the Appendix for Non-GAAP R
Slide 11: Capital Allocation
1Q 2024 Capital Allocation CAPITAL ALLOCATION ($M) NOTES 1Q 23 1Q 24 • Continued strong cash conversion provides optionality Capital Expenditures $95 $94 • CapEx on pace for ~$300 million FY Debt Repayment (Borrowing)* (235) 155 • Recent attractive M&A opportunities remain limited • Share repurchase
Slide 12: Commentary
1Q 2024 Commentary • Vehicle supply and demand continue to normalize • Focused on managing controllable variables well • Strong cash flow generation continues • Prudent capital deployment key tenet of model Resilient Business Model 12
Slide 13: AutoNation
1Q 2024 AutoNation Solid operating results in a normalizing environment Strong cash conversion and attractive capital deployment Continuing to invest for growth including processes and technology as well as CapEx Experienced AutoNation team focused on delivering shareholder returns 13
Slide 14: Appendix
Appendix This presentation contains certain non-GAAP financial measures for which we have set forth below reconciliations to the most comparable GAAP measures. The Company believes that these measures improve the transparency of the Company’s disclosure, provide a meaningful presentation of the Comp
Slide 15: Global Financial Crisis to 2024
SELECT HISTORICAL DATA Global Financial Crisis to 2024 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 1Q 24* Avg. SAAR (mm) 13.1 10.3 11.5 12.6 14.3 15.4 16.4 17.4 17.5 17.1 17.2 17.0 14.5 14.9 13.7 15.6 15.4 14.9 New Retail SAAR (mm) 10.6 8.6 9.2 10.3 11.7 12.8 13.6
Slide 16: Balance Sheet and Other Items
1Q 2024 Balance Sheet and Other Items ($ in millions) Balance Sheet and Other Highlights 3/31/23 12/31/23 3/31/24 Cash and cash equivalents $58.3 $60.8 $60.3 Inventory $2,196.2 $3,033.4 $3,002.7 Floorplan notes payable $2,185.7 $3,382.4 $3,270.9 Non-recourse debt $283.4 $258.4 $345.2 Non-vehicle deb
Slide 17: Comparable Basis Reconciliations
NON-GAAP RECONCILIATIONS Comparable Basis Reconciliations Three Months Ended March 31, 2023, and March 31, 2024 Income from Continuing Diluted Earnings Per Operating Income Operations Before Income Tax Provision(1) Effective Tax Rate Net Income Share(2) Income Taxes 2023 2024 2023 2024 2023 2024 202
Slide 18: Free Cash Flow Reconciliation
1Q 2024 Free Cash Flow Reconciliation ($ in millions) Free Cash Flow Reconciliation 3/31/23 3/31/24 Net cash provided by operating activities $510.0 $294.5 Decrease in Vehicle Floorplan – non-Trade (67.3) (93.5) Increase in Auto loans receivable, net 20.4 149.5 Adj. cash provided by operating activi