Avis Budget Group, Inc. · NASDAQ:CAR
Avis Budget — Q3 2018 Earnings Presentation
17 slides from Avis Budget's earnings presentation, Nov 6, 2018
Slide 1: Third Quarter 2018 Earnings Call
2018 THIRD QUARTER EARNINGS CALL November 6, 2018 Webcast: ir.avisbudgetgroup.com Dial-in: (630) 395.0021 Replay: (402) 220-0222 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 Adjusted EPS • Record $2.8 billion revenue • Americas delivered record Adjusted EBITDA $3.33 T&M per Day increased for 5th consecutive $3.10 7% quarter • Strong International volume despite challenging European summer • Lowered per-unit fleet costs by 7% excluding exchange
Slide 4: Strategic Initiatives
STRATEGIC INITIATIVES • Substantial improvement in ancillary trends Profitable Revenue • Amazon agreement extended to include Budget brand Growth • Developing new and innovative ancillary products Web and Mobile • Prepaid bookings increased double-digits Platforms • Conversion on our proprietary cha
Slide 5: Advances in Mobility
ADVANCES IN MOBILITY Driving efficiencies through Connected Car • New agreement with Ford to add 35,000 connected vehicles • K.C. mobility lab using vehicle diagnostic codes to identify cost savings opportunities Innovating with Zipcar • Zipcar Flex growing monthly and contributing to International
Slide 6: Americas Third Quarter Results
AMERICAS THIRD QUARTER RESULTS Revenue $1,839 $1,844 • Revenue increased 1% excluding exchange rate effects • Volume grew 1% despite record recalls • Revenue per Day essentially in-line due to change in loyalty accounting Third Quarter Third Quarter Pricing under historical T&M per Day metric 2017
Slide 7: International Third Quarter Results
INTERNATIONAL THIRD QUARTER RESULTS Revenue $934 $913 • Revenue growth of 4% excluding exchange rate effects • Strong 7% volume growth Good commercial performance in Europe Asia-Pacific growth driven by Australia Third Quarter Third Quarter 2017 2018 • Revenue per Day was 2% lower excluding exch
Slide 8: Strong Cash Flow and Funding Position
STRONG CASH FLOW AND FUNDING POSITION Net Corporate Leverage • Generated $289 million of Adjusted Free Cash Flow year-to-date 4.1x Capex of $157 million year-to-date including 3.8x revenue management, connected car and new Zipcar platform Acquisitions and investments of $108 million year-to-date
Slide 9: Updating 2018 Adjusted Earnings Outlook
UPDATING 2018 ADJUSTED EARNINGS OUTLOOK Year-over-Year (in millions, except EPS) Full-Year Projection Growth Revenues $9,100 – 9,200 [3-6%] 3% Adjusted EBITDA 760 – 800 [1-10%] 6% Non-vehicle D&A 200 [4%] 0% Interest expense 190 [6%] 1% Adjusted pretax income 370 – 410 [(5%)-16%] 13% Adjusted net in
Slide 10: Reiterating 2018 Adjusted Free Cash Flow Outlook
REITERATING 2018 ADJUSTED FREE CASH FLOW OUTLOOK (in millions) Full-Year Projection Adjusted pretax income $370 – 410 Plus: Non-vehicle D&A 200 Less: Capex (225) Less: Cash taxes (45) – (55) Plus: Vehicle programs, 25 – 45 Working capital and other Adjusted Free Cash Flow $325 – 375 See slide A-2 fo
Slide 11: Summary
SUMMARY • Delivered record U.S. pricing and record Americas Adjusted EBITDA • Strong demand from Amazon customers, recently added Budget brand • International volume up 7% despite challenging summer in Europe • Investing for growth through acquisitions and strategic investments • Strong funding posi
Slide 12: Avis Budget Group
avis budget group
Slide 13: Appendix
APPENDIX
Slide 14: 2018 Currency Outlook
2018 CURRENCY OUTLOOK First Second Third Fourth Full Year (in millions) Quarter Quarter Quarter Quarter 2018 Revenue $63 $41 $(31) $(28)-(18) $45-55 Adjusted EBITDA $6 $21 $(5) $(6)-(1) $16-21 (net of hedging) Expect a $16 – $21 million year-over-year Adjusted EBITDA benefit A-1
Slide 15: 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 co
Slide 16: 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, 2018 2017 Net Income $ 213 $ 245 Add certain items, net of tax: Acquisition-related amortization expense 11 10 Transaction-related costs,
Slide 17: Reconciliations of Non-GAAP Measures
RECONCILIATIONS OF NON-GAAP MEASURES Reconciliation of Net Corporate Debt (in millions): December 31, September 30, 2017 2018 Corporate debt $ 3,599 $ 3,561 Less: Cash and cash equivalents 611 605 Net Corporate Debt $ 2,988 $ 2,956 Last Twelve Months Reconciliation of net income to Adjusted EBITDA (