Slide 1: Second Quarter Earnings Call
SECOND QUARTER EARNINGS CALL August 8, 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: Second Quarter Highlights
SECOND QUARTER HIGHLIGHTS • Results reflect: Lower pricing due to industry over-fleeting Higher per-unit fleet costs due to lower used-car values • Industry fleets tightened up in the Americas towards the end of the quarter Rate per day increased more than 1% in July • We have identified $25 m
Slide 4: We've Been Busy…
WE’VE BEEN BUSY… Alexa will take care of making reservations 4
Slide 5: Company Second Quarter Results
COMPANY SECOND QUARTER RESULTS Revenue Adjusted EBITDA (in millions) (in millions) $2,238 $2,243 $204 $140 Second Quarter Second Quarter Second Quarter Second Quarter 2017 2016 2017 2016 Reconciliation of net income (loss) to Adjusted EBITDA can be found on slide A-3 of this presentation 5
Slide 6: Americas Second Quarter Results
AMERICAS SECOND QUARTER RESULTS • Leisure volume increased 6% and commercial volume was down 4% • Rate per day was 4% lower year-over-year Inbound volume • Per-unit fleet costs increased just under 10% year-over-year grew 5% • Adjusted EBITDA was $67 million lower compared to prior year Americas Rev
Slide 7: Americas Second Quarter Fleet Costs
AMERICAS SECOND QUARTER FLEET COSTS Second Quarter 2017 Monthly Per-Unit Fleet Costs $344 $314 48% 52% Alternative Channels Traditional Second Quarter 2016 Auction Second Quarter Second Quarter 39% 2017 2016 61% Excludes Truck 7
Slide 8: International Second Quarter Results
INTERNATIONAL SECOND QUARTER RESULTS • Volume increased 11%, including 6% from the acquisition of FranceCars • Local-currency rate per day was 3% lower reflecting competitive market conditions Inbound volume • Revenue grew 4%, or 6% in local currency grew 6% • Adjusted EBITDA increased 4% and 14% in
Slide 9: Strong Cash Flow and Funding Position
STRONG CASH FLOW AND FUNDING POSITION • Adjusted free cash flow of $397 million in the first half benefitted from timing of vehicle programs, expected to reverse in the second Repurchased $100 million half, and from strong working capital management of shares in the first half • $3 billion of availa
Slide 10: 2017 Adjusted Earnings Outlook
2017 ADJUSTED EARNINGS OUTLOOK (in millions, except EPS) Full-Year Projection Revenue $8,800 – 8,950 Non- GAAP effective tax rate expected to Adjusted EBITDA 725 – 775 be approximately 36% Non-vehicle D&A 205 Diluted share count of approximately 84 Interest expense to 86 million 195 – 200 Adjusted p
Slide 11: 2017 Adjusted Free Cash Flow Outlook
2017 ADJUSTED FREE CASH FLOW OUTLOOK Full-Year Projection (in millions) Adjusted pretax income $320 – $375 Plus: Non-vehicle D&A 205 Less: Capex (200) Less: Cash taxes (55) – (75) Plus: Vehicle programs 50 – 60 Plus: Working capital and other 30 – (15) Adjusted Free Cash Flow Approx. $350 All projec
Slide 12: Driving Profitable Revenue Growth
DRIVING PROFITABLE REVENUE GROWTH Pricing Manager Fleet Optimizer Demand Forecaster 12
Slide 13: Improving and Differentiating Our Customers' Digital User Experience
IMPROVING AND DIFFERENTIATING OUR CUSTOMERS’ DIGITAL USER EXPERIENCE 13
Slide 14: Leveraging Our Global Presence and Capabilities in New and Innovative Ways
LEVERAGING OUR GLOBAL PRESENCE AND CAPABILITIES IN NEW AND INNOVATIVE WAYS 14
Slide 15: Connected Cars Will Facilitate Substantial Operational Efficiencies
CONNECTED CARS WILL FACILITATE SUBSTANTIAL OPERATIONAL EFFICIENCIES Leverage connected car technology and organizational experience to… Reinvent Enhance Optimize our global end-to-end rental processes. 15
Slide 16: First of Its Kind Start-Up Technology Mobility Accelerator
FIRST OF ITS KIND START-UP TECHNOLOGY MOBILITY ACCELERATOR 16
Slide 17: Summary
SUMMARY • Higher fleet costs and lower pricing put pressure on second quarter results • Pricing has begun to improve in the Americas and was up more than 1% in July • Focused on multiple transformative cost saving initiatives • Leveraging our core competencies to play a major role in the future of m
Slide 18: Avis Budget Group
avis budget group
Slide 19: Appendix
APPENDIX
Slide 20: 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) $15-20 $25-30 $15-25 Adjusted EBITDA $18 ($7) $4-7 $5-7 $20-25 (net of hedging) Expect a $20 - $25 million year-over-year benefit to Adjusted EBITDA Esti
Slide 21: 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 22: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of net income (loss) to adjusted net income (loss) (in millions, except per-share amounts): Three Months Ended June 30, 2017 2016 Net income (loss) $ 3 $ 36 Add certain items, net of tax: Acquisition-related amortization expense 11 10 Restructuring
Slide 23: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of net corporate debt (in millions): June 30, 2017 Corporate debt $ 3,572 Less: Cash and cash equivalents 776 Net corporate debt $ 2,796 Latest Twelve Months Ended Reconciliation of net income (loss) to Adjusted EBITDA (in millions): June 30, 2017