- Revenue was $727.4 million as
compared to $945.8 million in the
prior year, a decrease of (23.1)%
- Canadian total retail unit sales progressively improved from a
decrease of (50)% for the month of April to a decrease of (25)% for
the month of May to an increase of 33% for the month of June (all
changes year-over-year)
- Significantly outperformed the Canadian market with same store
new retail unit sales decreasing (23.9)% compared to the Canadian
market decrease of (44.3)% as reported by DesRosiers Automotive
Consultants
- Canadian used to new retail units ratio increased 36.8% to 1.00
from 0.73 last year
- Same store finance and insurance gross profit per unit grew by
18.0% compared to prior year
- In response to COVID-19, re-engineered business model to better
position the Company for top decile operating performance with
permanent annualized cost savings of approximately $10 million identified and actioned
- Net indebtedness decreased by $45.8
million from $170.0 million at
the end of Q1 2020 to $124.2 million
at the end of Q2 2020
- Free cash flow of $52.6 million
in the quarter as compared to $(21.8)
million in the prior year. Free cash flow on a 12 month
trailing basis of $178.1 million at
Q2 2020 as compared to $(19.5)
million in Q2 2019 on a 12 month trailing basis
EDMONTON, AB, Aug. 11, 2020 /CNW/ - AutoCanada Inc.
("AutoCanada" or the "Company") (TSX: ACQ), a multi-location North
American automobile dealership group, today reported its financial
results for the three month period ended June 30, 2020.
"AutoCanada achieved a number of significant milestones in the
second quarter, advancing our strategic priorities and continuing
to execute on our Go Forward Plan while substantially strengthening
our balance sheet, reducing net debt and increasing free cash flow
in spite of COVID-19," said Paul
Antony, Executive Chairman of AutoCanada. "Very early
on in the COVID-19 pandemic, we took decisive actions, implementing
a range of measures in response to the crisis that have enhanced
our resiliency and positioned the Company for industry-leading
performance that will drive growth and competitive differentiation
going forward. Our cost reduction measures have resulted in
structural cost savings of approximately $10
million.
"I'm extremely proud of our people, who have worked hard and
delivered excellent performance, continuing to prove our complete
business model under challenging conditions. We remain
confident that AutoCanada's resilient business model, transformed
platform and strengthened balance sheet position us to emerge from
this period even stronger and with momentum."
2020 Second Quarter Key Highlights and Recent
Developments
All comparisons presented below are between the three-month
period ended June 30, 2020 and the three-month period ended
June 30, 2019, unless otherwise
indicated.
Executive Overview
The Company continued to
demonstrate strong performance through the second quarter as we
executed on all elements of our complete business model during a
complex and unpredictable period in the market. We outperformed the
Canadian new vehicle retail market for the sixth consecutive
quarter, delivered a second consecutive quarter where our used to
new retail units ratio was at or better than 1.0, and increased our
same store finance and insurance gross profit per unit by 18.0%,
the eighth consecutive quarter of year-over-year growth. Notably,
we reduced our net indebtedness by $45.8
million from March 31, 2020 in
a challenging quarter where revenues were down by (23.1)%.
Importantly, Q2 volatility served as a catalyst for re-evaluating
the Company's business practices, operations and other key
initiatives. This includes both operating performance in existing
segments as well as initiatives expected to drive growth and
competitive differentiation going forward. As a result, management
believes AutoCanada is better positioned to deliver
industry-leading performance going forward.
Our priorities, both from the onset of COVID-19 and to date,
included focusing on the safety of our people and customers and
ensuring we followed all government requirements to safely address
the pandemic.
Over the last quarter, management developed and staged an action
plan to mitigate losses, manage inventory and protect cash and
liquidity. Cost reduction actions included employee reductions,
aggressive expense management, and deferral of all discretionary
costs. Inventory management actions included recognition of
inventory write-downs to capture the impact from the loss of a key
selling period (last two weeks of March, April and May) and the
resulting buildup of inventory. The write-down allowed management
to address the buildup of dealership inventory with 2019 and 2020
models in advance of expected receipt of 2021 models.
With the onset of COVID-19, the Company used the opportunity to
complete a comprehensive review of all aspects of the business, in
essence re-engineering the business model where applicable. With
the objective of positioning the Company well for Q3 2020 and
beyond, annualized cost savings of approximately $10 million were identified and actioned, and all
identified impacts to inventory, receivables and other accounts
were provisioned. Importantly, none of these cost saving actions
are expected to impact the Company's strategic position in the
market or ability to execute.
Total write-downs, provisions, and typically non-recurring
charges recognized in the quarter included:
- Inventory write-down of $20.9
million, comprised of the following:
-
- Write-down to Canadian new vehicle inventory of $9.2 million, used vehicle inventory of
$4.8 million and parts inventory of
$3.9 million
- Write-down to U.S. new vehicle inventory of $2.6 million and used vehicle inventory of
$0.4 million
- Severance charges of $8.2
million
- Incremental provision for aged receivables of $3.2 million
- Provision for contingent liabilities, and charges taken for
facility sublease, and other expenses of $2.6 million
- Write-off of prepaid advertising leads of $2.1 million
- One-time retention and recognition payments of $1.7 million for key dealership employees
- Other charges including true-up of accruals and other
liabilities of $4.5 million
The greater majority, or approximately $40 million of these charges were non-cash in the
quarter.
Cash management actions included an amendment to our syndicated
credit facility (the "Credit Facility") providing covenant relief
through June 30, 2021, the suspension
of our dividend, and the deferral of capital spending. These
actions provide us with ample liquidity and full access to the
$175 million revolving facility in
our Credit Facility.
Our action plan measures were taken with both an eye to managing
a range of COVID-19 impacts to date, and to ensure the Company
enters Q3 2020 well positioned to deliver exceptional operating
performance going forward.
The Company's same store new retail unit sales outperformed the
Canadian market for the sixth consecutive quarter. Consolidated
revenues of $727.4 million reflected
a decrease of (23.1)% over the prior year while same store new
retail unit sales decreased by (23.9)% as compared to the Canadian
market decrease of (44.3)%, for brands represented by AutoCanada,
as reported by DesRosiers Automotive Consultants. Canadian total
retail unit sales progressively improved from a decrease of (50)%
for the month of April to a decrease of (25)% for the month of May
to an increase of 33% for the month of June (all changes
year-over-year). Preliminary Canadian total retail unit sales for
the month of July reflects an increase of 19%.
The challenging environment and management's response to the
pandemic drove a decrease of $(27.3)
million from the prior year, to an Adjusted EBITDA of
$4.8 million. Adjusted EBITDA
included $43.2 million in inventory
write-downs, provisions, and typically non-recurring charges, as
highlighted above. The greater majority, or approximately
$40 million of these charges were
non-cash in the quarter. Results also reflect the recognition of
$26.2 million in Canada Emergency Wage Subsidy ("CEWS"),
recorded as a reduction to employee costs; of this amount
recognized, half was received in the quarter, with the balance due
in Q3.
Net indebtedness (total indebtedness less cash and cash
equivalents on hand) decreased by $45.8
million from $170.0 million at
the end of Q1 2020 to $124.2 million
at the end of Q2 2020. Free cash flow was $52.6 million in the quarter as compared to
$(21.8) million in the prior
year.
While we don't know what the future holds at this point with
COVID-19, we've taken our learnings from this situation to
re-evaluate and adapt our business to drive industry-leading
performance. We're confident that we will be a top decile performer
in any environment. With our complete business model, our strong
balance sheet and our team, we are well positioned to emerge from
this pandemic even stronger.
Consolidated AutoCanada Highlights
COVID-19 NEGATIVELY IMPACTS QUARTER; NET
INDEBTEDNESS IMPROVED $45.8M FROM END
OF Q1 2020
For the first two months of Q2 2020, our performance was
negatively impacted by COVID-19. In June, our total retail vehicles
unit sales performance improved by 28% as compared to the prior
year.
For the three-month period ended June 30, 2020:
- Revenue was $727.4 million, a
decrease of $(218.3) million or
(23.1)%
- Total vehicles sold were 15,094, a decrease of (4,259) units or
(22.0)%
- Net income (loss) for the period was $(20.1) million (or $(0.72) per diluted share) versus $(3.5) million (or $(0.15) per diluted share)
- Adjusted EBITDA decreased by (85.0)% to $4.8 million, a decrease of $(27.3) million
-
- Typically non-recurring provisions of $43.2 million were recorded in the quarter, of
which approximately $40 million were
non-cash in nature
- CEWS of $26.2 million was
recorded in the quarter, of which $13.0
million was received in cash; remaining balance to be
received in Q3 2020
- Adjusting for both the provisions and CEWS, normalized Adjusted
EBITDA improves to $21.8 million as
compared to $32.1 million in the
prior year
- Ending net indebtedness was $124.2
million, an improvement in the quarter of $45.8 million from the end of Q1 2020; based on
cash and cash equivalents and availability on our Credit Facility,
our liquidity was $177.8 million.
Total Net Funded Debt to Bank EBITDA ratio of 3.23x at the end of
Q2 2020 was well within our covenant threshold of 5.00x.
Canadian Operations Highlights
FOR THE SIXTH CONSECUTIVE QUARTER,
OUTPERFORMED CANADIAN NEW RETAIL MARKET
Management continued to execute its complete business model
during the quarter. For the sixth consecutive quarter, we
outperformed the Canadian market, as same store new retail unit
sales decreased by (23.9)% as compared to the market decrease of
(44.3)%, for brands represented by AutoCanada, as reported by
DesRosiers Automotive Consultants. Our F&I initiative helped
increase gross profit per retail unit average to $2,646, an increase of 16.2% year-over-year. Our
used to new retail units ratio increased to 1.00 from 0.73 in the
prior year; this was our second consecutive quarter where our used
to new retail units ratio is at or better than 1.0.
For the first two months of Q2 2020, the impact of COVID-19
resulted in a slow-down in the Canadian market as non-essential
business closure orders were implemented across provinces and
cities. As a result of the broader market restrictions, on a
year-over-year basis, the Company's total retail vehicles sold
decreased (50)% for the month of April and decreased (25)% for the
month of May. For the month of June, total retail vehicles sold
increased by 33% as compared to the prior year.
For the three-month period ended June 30, 2020:
- Revenue was $656.4 million, a
decrease of (20.9)%
- Total retail vehicles sold were 13,053, a decrease of (2,139)
units or (14.1)%
-
- Same store new and used retail unit sales decreased by (13.4)%
to 12,307 units
-
- Same store used retail unit sales increased by 0.7%
- Used to new retail units ratio increased to 1.00 from 0.73, an
increase of 36.8%
- Finance and insurance gross profit per retail unit average
increased to $2,646, up 16.2% or
$369 per unit
- Net (loss) income for the period was $(13.7) million, down (207.0)% from a net income
of $12.8 million in 2019
- Adjusted EBITDA decreased (74.2)% to $8.3 million, a decrease of $(24.0) million
-
- Typically non-recurring provisions of $38.8 million were recorded in the quarter, of
which approximately $36 million were
non-cash in nature
- CEWS of $26.2 million was
recorded in the quarter, of which $13.0
million was received in cash; remaining balance to be
received in Q3 2020
- Adjusting for both the provisions and CEWS, normalized Adjusted
EBITDA improves to $20.9 million as
compared to $32.3 million in the
prior year
U.S. Operations Highlights
COVID-19 NEGATIVELY IMPACTS U.S.
PERFORMANCE
The U.S. Operations segment was particularly negatively impacted
by the pandemic, including government restrictions in the state of
Illinois. Despite the impacts of
COVID-19, management continues to focus on profitability by
ensuring vehicle profits are not sacrificed in the pursuit of
vehicle unit sales and continued improvements to the expense
structure. Signalling good progress on driving improved segment
profitability, used vehicles, parts, service and collision repair,
and finance and insurance gross profit percentage were up over the
prior year.
- Revenue was $71.1 million, a
decrease of (38.8)%
- Retail unit sales decreased to 1,701 units, down (666) units or
(28.1)%
- Net (loss) income for the period was $(6.4) million, an increase of 61.0% from
$(16.3) million in 2019
- Adjusted EBITDA was $(3.5)
million, a decrease of $(3.3)
million from 2019
-
- Typically non-recurring non-cash provisions of $4.4 million were recorded in the quarter,
primarily associated with inventory write-downs
- Adjusting for these provisions, normalized Adjusted EBITDA was
$0.9 million, an increase of
$1.1 million from 2019
Same Store Metrics
SAME STORE USED RETAIL UNIT SALES GROWTH
OF 0.7%
Total same store new and used retail unit sales for Canadian
Operations decreased by (13.4)% to 12,307 units, with new
retail units showing a decrease of (23.9)% and used retail units
showing an increase of 0.7%. The Company continues to strengthen
and build on our complete business model, as highlighted through
continued success of the F&I department, which led to an
increase in average F&I gross profit per retail unit of
$409 per unit compared to the prior
year. In addition, despite the (13.4)% reduction in total same
store retail units sold, finance and insurance gross profit
increased by 2.2% and demonstrates the stability of our complete
business model. The decrease of new retail units by (23.9)%
outperformed the market decrease of (44.3)% in the Canadian new
vehicle market for the brands represented by AutoCanada, as
reported by DesRosiers Automotive Consultants. The same stores
metric includes only Canadian dealerships which have been owned for
at least two full years since acquisition.
- Revenue decreased to $589.7
million, a decrease of (22.4)%
- Gross profit decreased by $(43.3)
million or (33.9)%
-
- Adjusting for the same store inventory write-down of
$16.9 million recognized, gross
profit decreased by $(26.4) million
or (20.7)%; gross profit percentage increased to 17.2% as compared
to 16.8% in the prior year
- Used to new retail units ratio increased to 0.99 from 0.75
- Finance and insurance gross profit per retail unit average
increased to $2,678, up 18.0% or
$409 per unit; gross profit increased
to $33.0 million as compared to
$32.2 million in the prior year
- Parts, service and collision repair gross profit decreased to
$38.0 million, a decrease of
(26.3)%
-
- Adjusting for the same store parts inventory write-down of
$3.7 million recognized, gross profit
decreased by (19.1)%; gross profit percentage increased to 54.8%,
as compared to 51.2% in the prior year
Financing and Investing Activities and Other Recent
Developments
AMENDMENT EXECUTED EXTENDING COVENANT RELIEF
TO JUNE 30, 2021
As at June 30, 2020, based on cash and cash equivalents and
availability on our Credit Facility, our liquidity was $177.8 million.
In response to the impacts of COVID-19, management has taken the
following financial resilience measures to manage liquidity for the
next twelve months:
- Executed Credit Facility amendment dated April 20, 2020 that extends covenant relief to
June 30, 2021
-
- Includes replacement of Q2 2020 results with Q2 2019 results
for covenant calculation purposes
- Entered into arrangement with Ally Financial to replace
previous floorplan financing
- Continued suspension of the quarterly dividend
- Reduced capital expenditures to approximate $17 million for the year as compared to a 2-year
average of $29 million
-
- Increase from initial reduction in capital expenditures was
driven by improved performance through Q2 and an improved outlook
for the balance of year
Our immediate focus has been on preserving cash and managing
liquidity. By replacing Q2 2020 financial results with Q2 2019
financial results for covenant calculation purposes, we have
addressed covenant risks brought on by the impacts the
pandemic.
Board Member Retirement
The Company also announced today Dennis
DesRosiers' decision to retire from the Board of Directors,
effective March 2021.
Mr. DesRosiers has been a member of the Board since 2007,
bringing more than 40 years of experience in the Canadian
automotive sector to the role. Mr. DesRosiers helped
successfully guide the Company through several major events
including a period of extraordinary transformation for the
Company. During his tenure on the Board, Mr. DesRosiers
served on the Governance and Compensation Committee. Following Mr.
DesRosiers' retirement, AutoCanada will continue to work with
Dennis as a resource to the Company.
"On behalf of the Board of Directors, I would like to thank
Dennis for his many years of leadership, strategic guidance and
dedicated service to our Company," said Mr. Antony. "We are
grateful for the unmatched knowledge he brought to the AutoCanada
Board. His wisdom and experience will be missed, and we wish him
well in his retirement."
Recent Performance
Based on current trending information, the impacts of COVID-19
on our business model have been more moderate than initially
expected. We entered Q2 2020 well prepared as a result of
management's actions taken early in the crisis and the continued
refinement of our business model.
The graph below shows the impact the challenging environment had
on our Canadian year-over -year retail unit results. Most notably,
June represented an impressive return to positive growth of 33%. In
July, we continued to see positive growth of 19%.
Canadian Retail Vehicle Unit Count YoY % Change
COVID-19 Response
Actions Taken in Response to COVID-19
Since the outset of COVID-19, the Company has carefully followed
the most current direction of government and related health
agencies in our policies and procedures across our operations. To
that end, we continue to implement stringent operating practices to
ensure personal protection, cleanliness, distancing, overall
employee and customer safety, work from home protocols wherever
possible, halting all non-essential travel, and following
established guidelines.
The Company continues to operate in accordance with local
government orders regarding the operation of non-essential
businesses due to COVID-19. From mid-March to mid-May, AutoCanada
was providing service operations and limited sales in New Brunswick, Ontario, and Illinois, only service operations in
Quebec, and full operations in the
balance of Canada. Currently, in
conjunction with the re-opening of the market and staged easing of
restrictions, AutoCanada's Canadian and U.S. dealerships are now
fully operational. We continue to monitor and ensure our operations
comply with all restrictions.
Across all our operations, AutoCanada will continue to safely
support customers with their vehicle servicing and purchasing
requirements, and customers are encouraged to contact their local
dealership as needed.
Combined with the measures taken as identified below, and the
Company's comprehensive business model, management believes the
Company to be well-positioned to operate within the COVID-19
environment. We continue to be mindful of the potential impacts of
COVID-19 over the coming months.
Financial Resilience Measures Taken
Our main
priorities continue to be the management of our inventory and cash
and to ensure we remain adaptable and resilient through the coming
quarters. The Company has taken measures to enhance financial
resilience in response to the evolving market conditions due to
COVID-19. These measures are designed to address immediate
challenges, while reinforcing the balance sheet to ensure we are
well-prepared to respond to market given the pandemic is expected
to continue for an unknown period of time.
|
|
Measures
Taken
|
Impact of Measures
Taken
|
Amended Credit
Facility
|
•
|
Staged covenant
relief thresholds for the Total and Senior Net Funded Debt to Bank
EBITDA
and Fixed Charge Coverage Ratios through to Q2 2021
|
Employee Reductions
and
Compensation
|
•
|
At the peak of the
COVID-19 situation, the Company had reduced its workforce by
approximately 1,700, or 40%
|
•
|
Adjusted pay plans to
further bias to variable cost structure
|
Discretionary Vendor
and
Landlord Expenses
|
•
|
Deferred, reduced, or
eliminated most discretionary and non-essential operational and
administrative spending
|
•
|
Worked with several
vendors and landlords to reduce costs through this period
and/or
defer payments on goods, services, and rent
|
Reduced Capital
Expenditures
|
•
|
Reduced capital
spending forecast to approximately $17 million for the year,
down approximately
$(12) million from two year average
|
Suspension of
Dividend
|
•
|
Suspension represents
approximately $11 million in annualized cash savings;
approximately $8 million for 2020
|
Non-Core Asset
Portfolio
|
•
|
Non-core assets
valued at $12.5 million; $1.1 million realized Q2 2020
YTD
|
Government Program
and
Subsidies
|
•
|
CEWS provided a total
of $27.2 million in income for the 16 week period from March 15
to
July 4, 2020
|
•
|
Recognized $26.2
million as income and $13.0 million as cash in Q2 2020; remainder
to be
recognized in Q3 2020
|
•
|
Will assess
eligibility for the remaining 20 week period of the program (July 5
to November
21, 2020) in accordance with relevant program
requirements
|
•
|
U.S. dealerships
received a loan of $5.4 million (USD) under the Paycheck
Protection
Program implemented by the Small Business Administration, with
opportunity for forgiveness
|
•
|
Continued deferral of
corporate income tax installments
|
Hedging
Actions
|
•
|
Restructured nearly
half of interest rate swap portfolio in the first half of the year,
to drive
approximately $2.2 million in annual cash savings
|
COVID-19 Operating Impacts to Business Objectives and
Strategy
Our business model continues to operate well, and we are gaining
traction from the success of the Go Forward Plan initiatives to
manage impacts from COVID-19. Based on currently available
information, we have created a detailed plan to ensure we
successfully weather the pandemic, while also improving and
strengthening our business model to best address the ever-changing
market condition. This includes actively managing headcount,
continued focus on used retail sales, leveraging our Business
Development Centre ("BDC") to drive parts and service, and ensuring
pay plan programs align with changing market conditions to drive
greater consistency across platforms and better alignment with
operating targets.
Management is actively assessing what the "new normal" will be.
Despite the market beginning to re-open in varying stages across
Canada and U.S., we are aware that
consumer uncertainty in our markets will likely create a lag in the
anticipated recovery. We will continue to respond according to
market conditions as they evolve.
The Company intends to emerge from this unprecedented event as a
stronger and more efficient operating entity.
Second Quarter Financial Information
The following
table summarizes the Company's performance for the quarter:
|
|
|
Three Months Ended
June 30
|
Consolidated
Operational Data
|
2020
|
2019
|
%
Change
|
Revenue
|
727,447
|
945,767
|
(23.1)%
|
Gross
profit
|
97,879
|
153,366
|
(36.2)%
|
Gross profit
%
|
13.5%
|
16.2%
|
(2.7)%
|
Operating
expenses
|
99,736
|
128,190
|
(22.2)%
|
Operating (loss)
profit
|
(4,388)
|
18,906
|
(123.2)%
|
Net (loss) for the
period
|
(20,052)
|
(3,512)
|
471.0%
|
Basic net (loss) per
share attributable to AutoCanada shareholders
|
(0.72)
|
(0.15)
|
380.0%
|
Adjusted EBITDA
1
|
4,828
|
32,100
|
(85.0)%
|
|
|
|
|
New retail vehicles
sold (units)
|
7,526
|
10,310
|
(27.0)%
|
New fleet vehicles
sold (units)
|
340
|
1,794
|
(81.0)%
|
Total new vehicles
sold (units)
|
7,866
|
12,104
|
(35.0)%
|
Used retail vehicles
sold (units)
|
7,228
|
7,249
|
(0.3)%
|
Total vehicles
sold
|
15,094
|
19,353
|
(22.0)%
|
Same store new retail
vehicles sold (units)
|
6,184
|
8,129
|
(23.9)%
|
Same store new fleet
vehicles sold (units)
|
321
|
1,602
|
(80.0)%
|
Same store used retail
vehicles sold (units)
|
6,123
|
6,080
|
0.7%
|
Same store total
vehicles sold
|
12,628
|
15,811
|
(20.1)%
|
Same store
revenue
|
589,717
|
760,208
|
(22.4)%
|
Same store gross
profit
|
84,295
|
127,591
|
(33.9)%
|
Same store gross
profit %
|
14.3%
|
16.8%
|
(2.5)%
|
See the Company's
Management's Discussion and Analysis for the quarter ended
June 30, 2020 for complete footnote
disclosures.
|
The following table shows the segmented operating results for
the Company for the three month periods ended June 30, 2020
and June 30, 2019.
|
|
|
|
|
Three Months
Ended
June 30, 2020
|
|
Three Months
Ended
June 30, 2019
|
|
Canada
$
|
|
U.S.
$
|
|
Total
$
|
|
Canada
$
|
|
U.S.
$
|
|
Total
$
|
New
vehicles
|
337,999
|
|
43,428
|
|
381,427
|
|
480,903
|
|
73,783
|
|
554,686
|
Used
vehicles
|
200,088
|
|
14,944
|
|
215,032
|
|
200,716
|
|
22,542
|
|
223,258
|
Parts, service and
collision repair
|
80,493
|
|
9,924
|
|
90,417
|
|
109,989
|
|
15,833
|
|
125,822
|
Finance, insurance and
other
|
37,801
|
|
2,770
|
|
40,571
|
|
38,120
|
|
3,881
|
|
42,001
|
Total
revenue
|
656,381
|
|
71,066
|
|
727,447
|
|
829,728
|
|
116,039
|
|
945,767
|
New
vehicles
|
12,485
|
|
(1,851)
|
|
10,634
|
|
35,196
|
|
1,449
|
|
36,645
|
Used
vehicles
|
2,839
|
|
1,385
|
|
4,224
|
|
12,172
|
|
1,764
|
|
13,936
|
Parts, service and
collision repair
|
40,008
|
|
5,828
|
|
45,836
|
|
56,118
|
|
8,400
|
|
64,518
|
Finance, insurance and
other
|
34,534
|
|
2,651
|
|
37,185
|
|
34,591
|
|
3,676
|
|
38,267
|
Total gross
profit
|
89,866
|
|
8,013
|
|
97,879
|
|
138,077
|
|
15,289
|
|
153,366
|
Employee
costs
|
66,167
|
|
6,129
|
|
72,296
|
|
67,348
|
|
8,957
|
|
76,305
|
Administrative
costs
|
37,237
|
|
5,409
|
|
42,646
|
|
34,889
|
|
5,241
|
|
40,130
|
Facility lease and
storage costs
|
648
|
|
—
|
|
648
|
|
75
|
|
910
|
|
985
|
Depreciation of
property and equipment
|
3,744
|
|
307
|
|
4,051
|
|
4,302
|
|
696
|
|
4,998
|
Depreciation of
right-of-use assets 2
|
5,682
|
|
636
|
|
6,318
|
|
5,210
|
|
562
|
|
5,772
|
Total operating
expenses
|
87,255
|
|
12,481
|
|
99,736
|
|
111,824
|
|
16,366
|
|
128,190
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
(loss) before other income
|
2,611
|
|
(4,468)
|
|
(1,857)
|
|
26,253
|
|
(1,077)
|
|
25,176
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
data
|
|
|
|
|
|
|
|
|
|
|
|
New retail vehicles
sold 1
|
6,518
|
|
1,008
|
|
7,526
|
|
8,768
|
|
1,542
|
|
10,310
|
New fleet vehicles
sold 1
|
337
|
|
3
|
|
340
|
|
1,791
|
|
3
|
|
1,794
|
Total new vehicles
sold 1
|
6,855
|
|
1,011
|
|
7,866
|
|
10,559
|
|
1,545
|
|
12,104
|
Used retail vehicles
sold 1
|
6,535
|
|
693
|
|
7,228
|
|
6,424
|
|
825
|
|
7,249
|
Total vehicles sold
1
|
13,390
|
|
1,704
|
|
15,094
|
|
16,983
|
|
2,370
|
|
19,353
|
# of service and
collision repair orders completed 1
|
146,422
|
|
20,138
|
|
166,560
|
|
205,104
|
|
37,030
|
|
242,134
|
# of dealerships at
period end
|
50
|
|
13
|
|
63
|
|
51
|
|
14
|
|
65
|
# of service bays at
period end
|
867
|
|
177
|
|
1,044
|
|
897
|
|
200
|
|
1,097
|
See the Company's
Management's Discussion and Analysis for the quarter ended
June 30, 2020 for complete footnote
disclosures.
|
MD&A and Financial Statements
Information included in this press release is a summary of
results. It should be read in conjunction with AutoCanada's
Consolidated Financial Statements and Management's Discussion and
Analysis for the quarter ended June 30, 2020, which can be
found on the Company's website at www.autocan.ca or on
www.sedar.com.
Non-GAAP Measures
This press release contains certain financial measures that do
not have any standardized meaning prescribed by Canadian
GAAP. Therefore, these financial measures may not be
comparable to similar measures presented by other issuers.
Investors are cautioned these measures should not be construed as
an alternative to net earnings (loss) or to cash provided by (used
in) operating, investing, and financing activities determined in
accordance with Canadian GAAP, as indicators of our
performance. We provide these measures to assist investors in
determining our ability to generate earnings and cash provided by
(used in) operating activities and to provide additional
information on how these cash resources are used. The following
"Non-GAAP Measures" are defined in the annual MD&A: Adjusted
EBITDA; Free Cash Flow; Net Indebtedness and Lease Adjusted
Leverage Ratio.
Conference Call
A conference call to discuss the results for the three months
ended June 30, 2020 will be held on August 12, 2020 at
9:00am Mountain (11:00am Eastern). To participate in the
conference call, please dial 1.888.231.8191 approximately 10
minutes prior to the call.
This conference call will also be webcast live over the internet
and can be accessed by all interested parties at the following URL:
https://www.autocan.ca/investors/q22020-presentation/
About AutoCanada
AutoCanada is a leading North American multi-location automobile
dealership group currently operating 62 franchised dealerships,
comprised of 26 brands, in eight provinces in Canada as well as a group in Illinois, USA. AutoCanada currently sells
Chrysler, Dodge, Jeep, Ram, FIAT, Alfa Romeo, Chevrolet, GMC,
Buick, Cadillac, Ford, Infiniti,
Nissan, Hyundai, Subaru, Audi, Volkswagen, Kia, Mazda,
Mercedes-Benz, BMW, MINI, Volvo, Toyota, Lincoln, and Honda branded vehicles. In 2019,
our dealerships sold approximately 71,000 vehicles and processed
approximately 900,000 service and collision repair orders in our
1,047 service bays generating revenue in excess of $3 billion.
Additional information about AutoCanada Inc. is available
at www.sedar.com and the Company's website
at www.autocan.ca.
Forward Looking Statements
Certain statements contained in this press release are
forward-looking statements and information (collectively
"forward-looking statements"), within the meaning of the applicable
Canadian securities legislation. We hereby provide cautionary
statements identifying important factors that could cause our
actual results to differ materially from those projected in these
forward-looking statements. Any statements that express, or involve
discussions as to, expectations, beliefs, plans, objectives,
assumptions of future events or performance (often, but not always,
through the use of words or phrases such as "will likely result",
"are expected to", "will continue", "is anticipated", "projection",
"vision", "goals", "objective", "target", "schedules", "outlook",
"anticipate", "expect", "estimate", "could", "should", "plan",
"seek", "may", "intend", "likely", "will", "believe", "shall" and
similar expressions) are not historical facts and are
forward-looking and may involve estimates and assumptions and are
subject to risks, uncertainties and other factors, some of which
are beyond our control and difficult to predict.
Accordingly, these factors could cause actual results or
outcomes to differ materially from those expressed in the
forward-looking statements. Therefore, any such forward-looking
statements are qualified in their entirety by reference to the
factors discussed throughout this press release.
The Company's Annual Information Form and other documents filed
with securities regulatory authorities (accessible through the
SEDAR website at www.sedar.com) describe the risks, material
assumptions and other factors that could influence actual results
and which are incorporated herein by reference.
Further, any forward-looking statement speaks only as of the
date on which such statement is made, and, except as required by
applicable law, we undertake no obligation to update any
forward-looking statement to reflect events or circumstances after
the date on which such statement is made or to reflect the
occurrence of unanticipated events. New factors emerge from time to
time, and it is not possible for management to predict all of such
factors and to assess in advance the impact of each such factor on
our business or the extent to which any factor, or combination of
factors, may cause actual results to differ materially from those
contained in any forward-looking statement.
Additional Information
Additional information about AutoCanada is available at the
Company's website at www.autocan.ca and www.sedar.com.
SOURCE AutoCanada Inc.