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National Press Release
 | Asbury Automotive Group Reports Fourth Quarter and Full Year 2008 Financial ResultsPublished 2009-03-16 07:00By Asbury Automotive Group, Inc. |
The Company's loss from continuing operations for the fourth quarter of
Commenting on the fourth quarter, Asbury's President and CEO
Commenting on the accomplishments during the quarter, Mr. Oglesby continued, "During the quarter we repurchased
The Company announced that it intends to file its 2008 Annual Report on Form 10-K with the U.S. Securities and Exchange Commission later today. In that document, the Company's independent public accounting firm, Deloitte & Touche LLP, included an explanatory paragraph in its audit report that indicated there is uncertainty that the Company will remain in compliance with certain covenants in its debt agreements, and that they believe this uncertainty raises substantial doubt about the Company's ability to continue as a going concern. The inclusion of this explanatory paragraph in the audit report constitutes a default under certain of the Company's borrowing facilities. The Company has received waivers from all of its associated lending partners with respect to these defaults, including 100% of the financial institutions that are party to our syndicated revolving credit facility. The Company was in compliance with all of its financial covenants as of
Mr. Monaghan continued, "With
Mr. Oglesby concluded, "We are rebuilding Asbury and structuring the company to deliver consistent cash flow and profitability, even during this period of unprecedented weakness in U.S. automotive sales."
For the full year, the loss from continuing operations was
Asbury will host a conference call to discuss its fourth quarter results this morning at
About Asbury Automotive Group
Asbury Automotive Group, Inc. ("Asbury"), headquartered in
Forward-Looking Statements
This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements relating to goals, plans, market conditions and projections regarding the Company's financial position, liquidity, ability to continue as a going concern, results of operations, market position, the benefits of its restructuring program and store-level productivity initiatives, ability to structure the business to be profitable in the current challenging economic environment, ability to maintain compliance with the covenants in its debt and lease agreements and future business strategy. These statements are based on management's current expectations and involve significant risks and uncertainties that may cause results to differ materially from those set forth in the statements. These risks and uncertainties include, among other things, market factors, the Company's relationships with, and financial stability of, vehicle manufacturers and other suppliers, risks associated with the Company's indebtedness, the Company's relationship with its lenders, risks related to competition in the automotive retail and service industries, general economic conditions both nationally and locally, governmental regulations, legislation and the Company's ability to execute its restructuring programs and other operational strategies. There can be no guarantees that the Company's plans for future operations will be successfully implemented or that they will prove to be commercially successful. These and other risk factors are discussed in the Company's annual report on Form 10-K and in its other filings with the Securities and Exchange Commission. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
[Tables Follow]
Asbury Automotive Group, Inc.
Consolidated Statements of Income
(In millions, except per share data)
(Unaudited)
For the Three For the Twelve
Months Ended Months Ended
December 31, December 31,
2008 2007 2008 2007
REVENUES:
New vehicle $517.9 $772.8 $2,705.8 $3,263.9
Used vehicle 206.0 311.0 1,085.3 1,389.8
Parts and service 166.8 169.9 692.6 664.9
Finance and insurance, net 27.7 37.5 135.8 155.2
Total revenues 918.4 1,291.2 4,619.5 5,473.8
COST OF SALES:
New vehicle 485.6 718.7 2,524.6 3,028.8
Used vehicle 191.2 286.8 994.3 1,268.7
Parts and service 84.2 83.9 343.4 323.5
Total cost of sales 761.0 1,089.4 3,862.3 4,621.0
GROSS PROFIT 157.4 201.8 757.2 852.8
OPERATING EXPENSES:
Selling, general and
administrative 136.3 160.9 616.6 656.2
Depreciation and
amortization 6.3 5.3 23.4 20.6
Impairment expenses 535.9 - 535.9 -
Other operating (income)
expense, net (0.3) (1.2) 1.3 1.0
(Loss) income from
operations (520.8) 36.8 (420.0) 175.0
OTHER INCOME (EXPENSE):
Floor plan interest expense (7.0) (9.9) (30.8) (41.0)
Other interest expense (11.0) (9.2) (40.1) (39.1)
Interest income 0.1 0.4 1.5 4.3
Gain (loss) on extinguishment
of long-term debt 34.2 - 32.5 (18.5)
Total other income
(expense), net 16.3 (18.7) (36.9) (94.3)
(Loss) income before
income taxes (504.5) 18.1 (456.9) 80.7
INCOME TAX (BENEFIT) EXPENSE (151.0) 7.1 (133.8) 29.0
(LOSS) INCOME FROM
CONTINUING OPERATIONS (353.5) 11.0 (323.1) 51.7
DISCONTINUED OPERATIONS,
net of tax (11.9) - (14.9) (0.7)
NET (LOSS) INCOME $(365.4) $11.0 $(338.0) $51.0
(LOSS) EARNINGS
PER COMMON SHARE:
Basic-
Continuing operations $(11.15) $0.35 $(10.19) $1.59
Discontinued operations (0.38) - (0.47) (0.02)
Net (loss) income $(11.53) $0.35 $(10.66) $1.57
Diluted-
Continuing operations $(11.15) $0.34 $(10.19) $1.55
Discontinued operations (0.38) - (0.47) (0.02)
Net (loss) income $(11.53) $0.34 $(10.66) $1.53
WEIGHTED AVERAGE
COMMON SHARES OUTSTANDING:
Basic 31.7 31.6 31.7 32.5
Diluted 31.7 32.2 31.7 33.3
Asbury Automotive Group, Inc.
Selected Data
(Dollars in millions, except per vehicle data)
(Unaudited)
As Reported for the
Three Months Ended
December 31, Increase
2008 2007 (Decrease) % Change
REVENUE:
New light vehicles $462.2 $731.0 $(268.8) (37%)
New heavy trucks 55.7 41.8 13.9 33%
Total new vehicle 517.9 772.8 (254.9) (33%)
Used retail 165.4 232.0 (66.6) (29%)
Used wholesale 40.6 79.0 (38.4) (49%)
Total used vehicle 206.0 311.0 (105.0) (34%)
Parts and service 166.8 169.9 (3.1) (2%)
Finance and insurance, net 27.7 37.5 (9.8) (26%)
Total revenue $918.4 $1,291.2 $(372.8) (29%)
GROSS PROFIT:
New light vehicles $ 30.4 $51.8 $(21.4) (41%)
New heavy trucks 1.9 2.3 (0.4) (17%)
Total new vehicle 32.3 54.1 (21.8) (40%)
Used retail 16.3 25.7 (9.4) (37%)
Used wholesale (1.5) (1.5) 0.0 -
Total used vehicle 14.8 24.2 (9.4) (39%)
Parts and service 82.6 86.0 (3.4) (4%)
Finance and insurance, net 27.7 37.5 (9.8) (26%)
Total gross profit $157.4 $201.8 $(44.4) (22%)
VEHICLES SOLD:
New light retail vehicles 14,557 22,477 (7,920) (35%)
New fleet vehicles 562 1,391 (829) (60%)
Total light vehicles 15,119 23,868 (8,749) (37%)
New heavy trucks 782 669 113 17%
Total new vehicle 15,901 24,537 (8,636) (35%)
Used retail units 9,251 12,427 (3,176) (26%)
REVENUE PER VEHICLE SOLD:
New light vehicles $30,571 $30,627 $(56) -
New heavy trucks 71,228 62,481 8,747 14%
Used retail 17,879 18,669 (790) (4%)
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $2,011 $2,170 $(159) (7%)
New heavy trucks 2,430 3,438 (1,008) (29%)
Used retail 1,762 2,068 (306) (15%)
Finance and insurance, net 1,101 1,015 86 8%
Dealership generated
finance and insurance, net 914 1,015 (101) (10%)
GROSS PROFIT MARGIN:
New light vehicles 6.6% 7.1% (0.5%) (7%)
New heavy trucks 3.4% 5.5% (2.1%) (38%)
Used retail 9.9% 11.1% (1.2%) (11%)
Parts and service 49.5% 50.6% (1.1%) (2%)
Total 17.1% 15.6% 1.5% 10%
REVENUE MIX PERCENTAGES:
New light vehicles 50.3% 56.6%
New heavy trucks 6.1% 3.2%
Used retail 18.0% 18.0%
Used wholesale 4.4% 6.1%
Parts and service 18.2% 13.2%
Finance and insurance, net 3.0% 2.9%
Total revenue 100.0% 100.0%
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 19.3% 25.7%
New heavy trucks 1.2% 1.1%
Used retail 10.4% 12.7%
Used wholesale (1.0%) (0.7%)
Parts and service 52.5% 42.6%
Finance and insurance, net 17.6% 18.6%
Total gross profit 100.0% 100.0%
SG&A EXPENSE AS A PERCENTAGE
OF GROSS PROFIT 86.6% 79.7% 6.9% 9%
Asbury Automotive Group, Inc.
Selected Data
(Dollars in millions, except per vehicle data)
(Unaudited)
Same Store for the
Three Months Ended
December 31, Increase
2008 2007 (Decrease) % Change
REVENUE:
New light vehicles $451.7 $731.0 $(279.3) (38%)
New heavy trucks 55.7 41.8 13.9 33%
Total new vehicle 507.4 772.8 (265.4) (34%)
Used retail 163.0 232.0 (69.0) (30%)
Used wholesale 39.8 79.0 (39.2) (50%)
Total used vehicle 202.8 311.0 (108.2) (35%)
Parts and service 163.3 169.9 (6.6) (4%)
Finance and insurance, net 27.2 37.5 (10.3) (27%)
Total revenue $900.7 $1,291.2 $(390.5) (30%)
GROSS PROFIT:
New light vehicles $29.6 $ 51.8 $(22.2) (43%)
New heavy trucks 1.9 2.3 (0.4) (17%)
Total new vehicle 31.5 54.1 (22.6) (42%)
Used retail 16.5 25.7 (9.2) (36%)
Used wholesale (1.5) (1.5) 0.0 -
Total used vehicle 15.0 24.2 (9.2) (38%)
Parts and service 80.9 86.0 (5.1) (6%)
Finance and insurance, net 27.2 37.5 (10.3) (27%)
Total gross profit $154.6 $201.8 $(47.2) (23%)
VEHICLES SOLD:
New light retail vehicles 14,127 22,477 (8,350) (37%)
New fleet vehicles 560 1,391 (831) (60%)
Total light vehicles 14,687 23,868 (9,181) (38%)
New heavy trucks 782 669 113 17%
Total new vehicle 15,469 24,537 (9,068) (37%)
Used retail units 9,091 12,427 (3,336) (27%)
REVENUE PER VEHICLE SOLD:
New light vehicles $30,755 $30,627 $128 -
New heavy trucks 71,228 62,481 8,747 14%
Used retail 17,930 18,669 (739) (4%)
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $2,015 $2,170 $(155) (7%)
New heavy trucks 2,430 3,438 (1,008) (29%)
Used retail 1,815 2,068 (253) (12%)
Finance and insurance, net 1,107 1,015 92 9%
Dealership generated finance
and insurance, net 916 1,015 (99) (10%)
GROSS PROFIT MARGIN:
New light vehicles 6.6% 7.1% (0.5%) (7%)
New heavy trucks 3.4% 5.5% (2.1%) (38%)
Used retail 10.1% 11.1% (1.0%) (9%)
Parts and service 49.5% 50.6% (1.1%) (2%)
Total 17.2% 15.6% 1.6% 10%
REVENUE MIX PERCENTAGES:
New light vehicles 50.1% 56.6%
New heavy trucks 6.2% 3.2%
Used retail 18.2% 18.0%
Used wholesale 4.4% 6.1%
Parts and service 18.1% 13.2%
Finance and insurance, net 3.0% 2.9%
Total revenue 100.0% 100.0%
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 19.1% 25.7%
New heavy trucks 1.2% 1.1%
Used retail 10.8% 12.7%
Used wholesale (1.0%) (0.7%)
Parts and service 52.3% 42.6%
Finance and insurance, net 17.6% 18.6%
Total gross profit 100.0% 100.0%
SG&A EXPENSE AS A PERCENTAGE
OF GROSS PROFIT 86.9% 79.7% 7.2% 9%
Asbury Automotive Group, Inc.
Selected Data
(Dollars in millions, except per vehicle data)
(Unaudited)
As Reported for the
Twelve Months Ended
December 31, Increase
2008 2007 (Decrease) % Change
REVENUE:
New light vehicles $2,514.7 $3,047.5 $(532.8) (17%)
New heavy trucks 191.1 216.4 (25.3) (12%)
Total new vehicle 2,705.8 3,263.9 (558.1) (17%)
Used retail 841.9 1,055.6 (213.7) (20%)
Used wholesale 243.4 334.2 (90.8) (27%)
Total used vehicle 1,085.3 1,389.8 (304.5) (22%)
Parts and service 692.6 664.9 27.7 4%
Finance and insurance, net 135.8 155.2 (19.4) (13%)
Total revenue $4,619.5 $5,473.8 $(854.3) (16%)
GROSS PROFIT:
New light vehicles $173.6 $224.8 $(51.2) (23%)
New heavy trucks 7.6 10.3 (2.7) (26%)
Total new vehicle 181.2 235.1 (53.9) (23%)
Used retail 94.8 123.3 (28.5) (23%)
Used wholesale (3.8) (2.2) (1.6) (73%)
Total used vehicle 91.0 121.1 (30.1) (25%)
Parts and service 349.2 341.4 7.8 2%
Finance and insurance, net 135.8 155.2 (19.4) (13%)
Total gross profit $757.2 $852.8 $(95.6) (11%)
VEHICLES SOLD:
New light retail vehicles 80,937 95,144 (14,207) (15%)
New fleet vehicles 3,932 7,419 (3,487) (47%)
Total light vehicles 84,869 102,563 (17,694) (17%)
New heavy trucks 2,885 3,625 (740) (20%)
Total new vehicle 87,754 106,188 (18,434) (17%)
Used retail units 47,325 57,663 (10,338) (18%)
REVENUE PER VEHICLE SOLD:
New light vehicles $29,630 $29,713 $(83) -
New heavy trucks 66,239 59,697 6,542 11%
Used retail 17,790 18,306 (516) (3%)
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $2,046 $2,192 $ (146) (7%)
New heavy trucks 2,634 2,841 (207) (7%)
Used retail 2,003 2,138 (135) (6%)
Finance and insurance, net 1,005 947 58 6%
Dealership generated
finance and insurance, net 971 947 24 3%
GROSS PROFIT MARGIN:
New light vehicles 6.9% 7.4% (0.5%) (7%)
New heavy trucks 4.0% 4.8% (0.8%) (17%)
Used retail 11.3% 11.7% (0.4%) (3%)
Parts and service 50.4% 51.3% (0.9%) (2%)
Total 16.4% 15.6% 0.8% 5%
REVENUE MIX PERCENTAGES:
New light vehicles 54.4% 55.7%
New heavy trucks 4.1% 4.0%
Used retail 18.2% 19.3%
Used wholesale 5.4% 6.1%
Parts and service 15.0% 12.1%
Finance and insurance, net 2.9% 2.8%
Total revenue 100.0% 100.0%
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 22.9% 26.4%
New heavy trucks 1.0% 1.2%
Used retail 12.5% 14.5%
Used wholesale (0.4%) (0.3%)
Parts and service 46.1% 40.0%
Finance and insurance, net 17.9% 18.2%
Total gross profit 100.0% 100.0%
SG&A EXPENSE AS A PERCENTAGE
OF GROSS PROFIT 81.4% 76.9% 4.5% 6%
Asbury Automotive Group, Inc.
Selected Data
(Dollars in millions, except per vehicle data)
(Unaudited)
Same Store for the
Twelve Months Ended
December 31, Increase
2008 2007 (Decrease) % Change
REVENUE:
New light vehicles $2,381.4 $3,047.5 $(666.1) (22%)
New heavy trucks 191.1 216.4 (25.3) (12%)
Total new vehicle 2,572.5 3,263.9 (691.4) (21%)
Used retail 809.6 1,055.6 (246.0) (23%)
Used wholesale 230.6 334.2 (103.6) (31%)
Total used vehicle 1,040.2 1,389.8 (349.6) (25%)
Parts and service 664.5 664.9 (0.4) -
Finance and insurance, net 131.5 155.2 (23.7) (15%)
Total revenue $4,408.7 $5,473.8 $(1,065.1) (19%)
GROSS PROFIT:
New light vehicles $162.9 $224.8 $(61.9) (28%)
New heavy trucks 7.6 10.3 (2.7) (26%)
Total new vehicle 170.5 235.1 (64.6) (27%)
Used retail 91.9 123.3 (31.4) (25%)
Used wholesale (3.7) (2.2) (1.5) (68%)
Total used vehicle 88.2 121.1 (32.9) (27%)
Parts and service 334.8 341.4 (6.6) (2%)
Finance and insurance, net 131.5 155.2 (23.7) (15%)
Total gross profit $725.0 $852.8 $(127.8) (15%)
VEHICLES SOLD:
New light retail vehicles 76,504 95,144 (18,640) (20%)
New fleet vehicles 3,831 7,419 (3,558) (48%)
Total light vehicles 80,335 102,563 (22,228) (22%)
New heavy trucks 2,885 3,625 (740) (20%)
Total new vehicle 83,220 106,188 (22,968) (22%)
Used retail units 45,607 57,663 (12,056) (21%)
REVENUE PER VEHICLE SOLD:
New light vehicles $29,643 $29,713 $(70) -
New heavy trucks 66,239 59,697 6,542 11%
Used retail 17,752 18,306 (554) (3%)
GROSS PROFIT PER VEHICLE SOLD:
New light vehicles $2,028 $2,192 $(164) (7%)
New heavy trucks 2,634 2,841 (207) (7%)
Used retail 2,015 2,138 (123) (6%)
Finance and insurance, net 1,021 947 74 8%
Dealership generated finance
and insurance, net 984 947 37 4%
GROSS PROFIT MARGIN:
New light vehicles 6.8% 7.4% (0.6%) (8%)
New heavy trucks 4.0% 4.8% (0.8%) (17%)
Used retail 11.4% 11.7% (0.3%) (3%)
Parts and service 50.4% 51.3% (0.9%) (2%)
Total 16.4% 15.6% 0.8% 5%
REVENUE MIX PERCENTAGES:
New light vehicles 54.0% 55.7%
New heavy trucks 4.3% 4.0%
Used retail 18.4% 19.3%
Used wholesale 5.2% 6.1%
Parts and service 15.1% 12.1%
Finance and insurance, net 3.0% 2.8%
Total revenue 100.0% 100.0%
GROSS PROFIT MIX PERCENTAGES:
New light vehicles 22.5% 26.4%
New heavy trucks 1.0% 1.2%
Used retail 12.7% 14.5%
Used wholesale (0.5%) (0.3%)
Parts and service 46.2% 40.0%
Finance and insurance, net 18.1% 18.2%
Total gross profit 100.0% 100.0%
SG&A EXPENSE AS A PERCENTAGE
OF GROSS PROFIT 81.8% 76.9% 4.9% 6%
Asbury Automotive Group, Inc.
Selected Data
(Dollars in millions)
(Unaudited)
December 31, December 31, Increase %
2008 2007 (Decrease) Change
BALANCE SHEET DATA
Cash and cash equivalents $ 91.6 $53.4 $38.2 71.5%
New vehicle inventory 562.2 622.7 (60.5) (9.7%)
Used vehicle inventory 59.9 101.1 (41.2) (40.8%)
Parts inventory 44.5 46.2 (1.7) (3.7%)
Total current assets 1,019.7 1,192.4 (172.7) (14.5%)
Floor plan notes payable 612.8 673.9 (61.1) (9.1%)
Total current liabilities 854.5 871.7 (17.2) (2.0%)
CAPITALIZATION
Long-term debt (including
current portion) $607.1 $475.6 $131.5 27.6%
Shareholders' equity 222.7 584.2 (361.5) (61.9%)
Total $829.8 $1,059.8 $(230.0) (21.7%)
BRAND MIX - NEW LIGHT VEHICLE UNITS
For the Twelve Months Ended
December 31,
2008 2007
Luxury:
BMW 5% 4%
Mercedes-Benz 4% 4%
Lexus 4% 4%
Acura 4% 4%
Infinity 3% 3%
Other Luxury 3% 3%
Total Luxury 23% 22%
Mid-Line Imports:
Honda 32% 30%
Toyota 11% 10%
Nissan 14% 15%
Other imports 4% 2%
Total Imports 61% 57%
Mid-Line Domestic:
Ford 7% 8%
Chevrolet 5% 6%
Other domestic 3% 5%
Total Domestic 15% 19%
Value 1% 2%
Total Light Vehicles 100% 100%
December 31, December 31,
2008 2007
DSI - NEW LIGHT VEHICLE 98.9 68.2
DSI - USED LIGHT VEHICLE 34.4 45.0
Asbury Automotive Group, Inc.
Supplemental Disclosures
(Dollars in millions, except per share data)
(Unaudited)
Our operations during 2008 and 2007 were impacted by certain items that
are not core dealership operating items, which we believe are important
to highlight when reviewing our results and should not be considered when
forecasting our future results.
The non-core items shown in the table below include (i) impairment
expenses totaling $491.7 million related to the write-off of all of our
goodwill, a $36.8 million impairment of franchise rights and other
intangible assets and a $7.4 million impairment of certain property and
equipment as a result of a sustained decline in our market capitalization
and a significant decline in our total revenue in the fourth quarter of
2008, (ii) gains and losses on the extinguishment of long-term debt,
(iii) a corporate generated F&I gain related to the sale of our remaining
interest in a pool of maintenance contracts, (iv) restructuring costs
consisting primarily of severance and retention expenses related to the
relocation of our corporate headquarters, (v) a reversal of deferred tax
asset valuation allowances that we now expect to realize, (vi) executive
separation benefits in 2008 and 2007 related to the departure of our
former chief financial officer and chief executive officer, respectively,
(vii) implementation costs associated with transitioning approximately
35% of our dealerships to the Arkona dealer management system, (viii)
legal settlement expenses in 2007 related to the settlement of legal
claims arising in, and before, the year 2003, and (ix) secondary offering
expenses in 2007 related to two secondary offerings in which we did not
receive any proceeds.
As Reported for the
Three Months Ended
December 31,
2008 2007
Non-core items - (income) expense
Impairment expenses $535.9 $-
Gain on extinguishment of long-term debt (34.2) -
Corporate generated F&I gain (4.7) -
Restructuring costs 3.3 -
Legal settlements expenses - 1.9
Dealer management system
implementation costs 0.1 -
Tax impact of non-core items above (149.4) (0.7)
Total $351.0 $1.2
Non-core items per dilutive share $11.07 $0.04
Weighted average common shares
outstanding (diluted) 31.7 32.2
As Reported for the
Twelve Months Ended
December 31,
2008 2007
Non-core items - (income) expense
Impairment expenses $535.9 $-
(Gain) loss on extinguishment
of long-term debt, net (32.5) 18.5
Corporate generated F&I gain (4.7) -
Restructuring costs 5.8 -
Executive separation benefits expense 1.7 3.0
Dealer management system
implementation costs 1.0 -
Legal settlements expenses - 2.5
Secondary offering expenses - 0.3
Tax impact of non-core items above (152.0) (9.0)
Reversal of deferred tax
valuation allowance (1.1) -
Total $354.1 $15.3
Non-core items per dilutive share $11.15 $0.46
Weighted average common
shares outstanding (diluted) 31.8 33.3
Asbury Automotive Group, Inc.
Summary of Debt Covenants
As of and for the Period Ended December 31, 2008
(Dollars in millions, except per vehicle data)
(Unaudited)
Wachovia Credit
Mortgages Facilities
Senior Leverage Ratio must be < 3.00
SECURED DEBT (numerator)
+ Mortgage notes payable (including
mortgages associated with assets held for sale) $177.5
+ Borrowings under Revolving Credit Facility 50.0
+ Capital lease obligations 0.3
+ Interest rate SWAP obligations -
+ Other indebtedness 12.1
= TOTAL SECURED DEBT (ex floorplan) $239.9
EBITDA (denominator)
+ Income from continuing operations
- trailing 12 months ("T12") $(323.1)
+ Add back Total interest expense
(ex floorplan interest) - T12 40.1
+ Add back Income tax expense - T12 (133.8)
+ Add back Depreciation & amortization - T12 23.4
+ Add back Other non-cash charges - T12 540.0
= CONSOLIDATED EBITDA 146.6
+ Add back Pro forma
acquisitions EBITDA (as defined) 0.3
+ Add back Pro forma rent savings (as defined) 6.8
= CONSOLIDATED PROFORMA EBITDA $153.7
SENIOR LEVERAGE RATIO 1.56
Total Leverage Ratio must be < 5.00
TOTAL DEBT (numerator)
+ 8.0% Sr. Subordinated Notes
(face value outstanding) $179.4 $179.4
+ 7.625% Sr. Subordinated Notes 143.2 143.2
+ 3.0% Convertible Notes 62.0 62.0
+ Mortgage notes payable (including
mortgages associated with
assets held for sale) 177.5 177.5
+ Borrowings under Revolving Credit Facility 50.0 50.0
+ Direct reimbursement obligations
under letters of credit 7.3 -
+ Capital lease obligations 0.3 0.3
+ Interest rate SWAP obligations 12.5 -
+ Other indebtedness (as defined) 13.2 12.1
= TOTAL DEBT (ex Floorplan) $645.4 $624.5
EBITDA (denominator)
+ Income from continuing operations
- trailing 12 months ("T12") $(323.1) $(323.1)
+ Add back Total interest
expense (ex floorplan) - T12 40.1 40.1
+ Add back Income tax expense - T12 (133.8) (133.8)
+ Add back Depreciation & amortization - T12 23.4 23.4
+ Add back Other non-cash charges - T12 548.1 540.0
+ Add back Non-recurring items - T12 8.0 -
= CONSOLIDATED EBITDA 162.7 146.6
+ Add back Pro forma acquisitions
EBITDA (as defined) 0.3 0.3
+ Add back Pro forma rent savings (as defined) - 6.8
= CONSOLIDATED PROFORMA EBITDA $163.0 $153.7
TOTAL LEVERAGE RATIO 3.96 4.06
Fixed Charge Coverage Ratio must be > 1.2
EBITDAR (numerator)
+ Pre-tax Income from continuing
operations - trailing 12 months ("T12") $(323.1) $(323.1)
+ Add back Total interest expense
(ex floorplan) - T12 40.1 40.1
+ Add back Income tax expense - T12 (133.8) (133.8)
+ Add back Depreciation & amortization - T12 23.4 23.4
+ Add back Other non-cash
charges - T12 (as defined) 548.1 540.0
+ Add back Non-recurring
items - T12 (as defined) 8.0 -
= CONSOLIDATED EBITDA 162.7 146.6
+ PLUS rent expense - T12 50.0 50.0
- LESS Capital expenditures (as defined) (17.4) (13.0)
= TOTAL EARNINGS AVAILABLE FOR FIXED CHARGES $195.3 $183.6
FIXED CHARGES (denominator)
+ Total interest expense
(ex Floorplan Interest) - T12 $40.1 $40.1
+ PLUS Required principal payments - T12 5.4 5.4
+ PLUS Rental expense - T12 50.0 50.0
- LESS Pro forma rent savings (as defined) - (6.8)
+ PLUS Cash paid for taxes - T12 8.8 8.8
= TOTAL FIXED CHARGES $104.3 $97.5
FIXED CHARGE COVERAGE RATIO 1.87 1.88
Current Ratio must be > 1.2
Total current assets (numerator)
+ Total current assets $1,019.7 $1,019.7
+ PLUS Available unused commitments
under Revolving Credit Facility 88.0 88.0
= TOTAL CURRENT ASSETS $1,107.7 $1,107.7
Total current liabilities (denominator)
+ Total current liabilities $854.5 $854.5
- LESS Debt balloon payments
due within 6-12 months - -
= TOTAL CURRENT LIABILITIES $854.5 $854.5
CURRENT RATIO 1.30 1.30
Adjusted Net Worth must be > $350 million
Stockholders' equity $222.7
- LESS 50% of net income subsequent
to March 31, 2008 (to the extent net
income is positive) -
- LESS Proceeds from stock option
exercises subsequent to March 31, 2008 (0.1)
+ ADD Impairment expenses, net of tax 383.0
= ADJUSTED NET WORTH $605.6
SOURCE Asbury Automotive Group, Inc.
