Slide 1: Third Quarter Earnings Call
THIRD QUARTER EARNINGS CALL November 7, 2017 Webcast: ir.avisbudgetgroup.com Dial-in: 630.395.0021 Replay: 402.220.0241 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: Third Quarter Highlights
THIRD QUARTER HIGHLIGHTS • Results reflect: Strong global volume growth Positive pricing and better than expected used car values in the Americas Double-digit volume growth but with lower pricing in our International region • Hurricane effect: $15 million negative Adjusted EBITDA impact in t
Slide 4: Driving Profitable Revenue Growth
DRIVING PROFITABLE REVENUE GROWTH Demand-Fleet- • Integrated system now live in six markets in the Americas Pricing System • Pricing robotic launched across 25 European cities Web and Mobile • Investments in websites driving strong prepaid growth Platforms • Mobile app conversion improved 40 basis p
Slide 5: Mobility Innovations
MOBILITY INNOVATIONS • Expanded Zipcar footprint • Broadening Avis Mobile App availability • Connected City pilot progressing well • Creating new service offerings such as Waymo partnership • Innovative technology opportunities with RocketSpace mobility accelerator 5
Slide 6: We Had a Record Quarter
WE HAD A RECORD QUARTER Revenue Adjusted EBITDA $2,656 $2,752 $482 4% $469 3% Third Quarter Third Quarter Third Quarter Third Quarter 2016 2017 2016 2017 Reconciliation of net income to Adjusted EBITDA can be found on slide A-3 of this presentation All $ amounts in millions 6
Slide 7: Americas Third Quarter Revenue
AMERICAS THIRD QUARTER REVENUE • Revenue increased 1% with an 80 basis point improvement in utilization $5 million negative • Leisure volume increased 3% year-over-year, commercial lower revenue impact from by 3% business disruption due to hurricanes Inbound rental days increased 3% • Leisure pric
Slide 8: Americas Third Quarter Costs
AMERICAS THIRD QUARTER COSTS Cost Saving Initiatives Fleet Disposition Channels • Manpower initiative drove a 4% productivity improvement January-September 2017 • Shuttling costs 4% lower per transaction, despite incremental costs from hurricanes 50% 50% Alternative Monthly Per-Unit Fleet Costs Chan
Slide 9: International Third Quarter Results
INTERNATIONAL THIRD QUARTER RESULTS • Revenue grew 9%, or 5% in local currency • Leisure growth driven by strong demand in Spain and Germany • Commercial volume increased a strong 8% Budget leisure volume grew 17% in Europe • Rate per day was down 1%, or 5% in local currency • Adjusted EBITDA increa
Slide 10: Strong Cash Flow and Funding Position
STRONG CASH FLOW AND FUNDING POSITION • Adjusted free cash flow year-to-date benefits from timing of vehicle Repurchased $127 million programs in first half of the year, partially reversed in third quarter of shares through • $4 billion of available liquidity September 30th • Corporate leverage of 3
Slide 11: 2017 Adjusted Earnings Outlook
2017 ADJUSTED EARNINGS OUTLOOK (in millions, except EPS) Full-Year Projection Revenue Growth $8,800 – 8,900 Adjusted effective tax rate expected to Adjusted EBITDA 725 – 745 be approximately 35% Non-vehicle D&A 205 Interest expense 195 Adjusted pretax income 325 – 345 Adjusted net income 210 – 225 A
Slide 12: 2017 Adjusted Free Cash Flow Outlook
2017 ADJUSTED FREE CASH FLOW OUTLOOK Full-Year Projection (in millions) Adjusted pretax income $325 – $345 Plus: Non-vehicle D&A 205 Less: Capex (200) Less: Cash taxes (55) – (65) Plus: Vehicle programs 80 – 85 Plus: Working capital and other (30) – (45) Adjusted Free Cash Flow Approx. $325 All figu
Slide 13: Summary
SUMMARY • Record quarter with improved pricing in the Americas and strong volume in our International segment • Initiatives to drive profitable revenue growth are proving successful • Manpower and shuttling initiatives are lowering our costs • Well positioned to capitalize on growth of outbound trav
Slide 14: Avis Budget Group
avis budget group
Slide 15: Appendix
APPENDIX
Slide 16: Currency Movements Year-Over-Year Effect
CURRENCY MOVEMENTS YEAR-OVER-YEAR EFFECT (in millions) First Second Third Fourth Full Year Quarter Quarter Quarter Quarter 2017 Revenue ($5) ($20) $42 $48-53 $65-70 Adjusted EBITDA $18 ($7) $9 $5-10 $25-30 (net of hedging) Expect a $25 - $30 million year-over-year benefit to Adjusted EBITDA Estimate
Slide 17: 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 com
Slide 18: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of net income to Adjusted net income (in millions, except per-share amounts): Three Months Ended September 30, 2017 2016 Net income $ 245 $ 209 Add certain items, net of tax: Acquisition-related amortization expense 10 10 Restructuring and other re
Slide 19: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of net corporate debt (in millions): September 30, 2017 Corporate debt $ 3,591 Less: Cash and cash equivalents 814 Net corporate debt $ 2,777 Latest Twelve Months Ended Reconciliation of net income to Adjusted EBITDA (in millions): September 30, 20