Financial Data and Key Metrics Changes - The company reported a gross transactional value (GTV) growth of 10% on a pro forma combined basis for the first quarter [20][66] - Adjusted earnings per share increased by 58% due to strong operational performance and the full quarter impact of the IAA inclusion [29][37] - The adjusted EBITDA guidance was increased to $1.2 billion to $1.26 billion based on strong top-line flow through and operational excellence [4][66] Business Line Data and Key Metrics Changes - Service revenue increased by 14%, with the service revenue take rate expanding approximately 80 basis points to 20.8% [10] - GTV in the commercial construction and transportation sector increased by 20%, driven by increases in lot volumes, partially offset by declines in average price per lot sold [28] - Automotive GTV increased by 6%, benefiting from higher unit volumes and a 3.3% higher average selling price [66] Market Data and Key Metrics Changes - The company noted a normalization of equipment supply in the construction and transportation sector following a post-pandemic surge [21] - The percentage of vehicles sold to international buyers reached an all-time high in the first quarter, indicating strong international market engagement [26] - Inventory revenue declined by 12%, with lower contributions from automotive, commercial construction, and transportation sectors [81] Company Strategy and Development Direction - The company is focused on integrating and driving returns from recent acquisitions, particularly IAA, while monitoring future acquisition opportunities [30][51] - Continuous improvement and operational efficiency are emphasized as critical levers for growth and market share expansion [65] - The company aims to maintain a target net leverage around two times while continuing to invest strategically in technology and business growth [46][82] Management's Comments on Operating Environment and Future Outlook - Management anticipates that GTV growth will moderate for the remainder of the year due to the full impact of a previously announced customer loss and normalization in partner performance [4][6] - The leadership team expressed confidence in the company's ability to deliver on commitments and improve service level agreements, which are expected to lead to market share gains [73][65] - The company is prepared for a competitive environment in the commercial construction and transportation sectors, with a focus on maintaining operational efficiency [81][61] Other Important Information - The company hosted its 21st Industry Leadership Summit, which attracted record attendance and served as a platform to strengthen partnerships and showcase operational improvements [24][41] - The company highlighted the importance of its omnichannel platform in optimizing price realization and matching supply with demand [9] Q&A Session Summary Question: Guidance and Performance Expectations - Management indicated that the guidance increase was based on Q1 performance being in line with expectations, with a focus on maintaining operational efficiency [71] Question: Auto Performance and ASP - Management discussed efforts to enhance average selling prices (ASP) through improved data offerings and operational performance, with expectations for consistent results moving forward [73] Question: Impact of Customer Loss - Management acknowledged the impact of the previously announced customer loss on GTV and unit volumes, particularly in the automotive sector [75] Question: Cost Management and SG&A - Management was asked about the sustainability of the current SG&A cost structure, indicating ongoing efforts to optimize costs while supporting volume growth [76] Question: Future Acquisition Strategy - Management expressed a cautious approach to future acquisitions, focusing on integrating existing acquisitions and ensuring operational efficiency [77]

[PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [ITEM 1: Condensed Consolidated Financial Statements](index=4&type=section&id=ITEM%201%3A%20Condensed%20Consolidated%20Financial%20Statements) This section presents RB Global, Inc's unaudited condensed consolidated financial statements for Q1 2024 [Condensed Consolidated Income Statements](index=4&type=section&id=Condensed%20Consolidated%20Income%20Statements) | Metric | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 1,064.7 | 512.4 | 108% | | Service Revenue | 849.1 | 343.6 | 147% | | Inventory Sales Revenue | 215.6 | 168.8 | 28% | | Operating Income (Loss) | 198.9 | (24.9) | 899% | | Net Income (Loss) | 107.4 | (28.2) | 481% | | Net Income (Loss) available to common stockholders | 97.1 | (34.2) | 384% | | Basic EPS | 0.53 | (0.28) | 289% | | Diluted EPS | 0.53 | (0.28) | 289% | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) | Metric | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Net income (loss) | 107.4 | (28.2) | 481% | | Foreign currency translation adjustment | (25.0) | 15.1 | (265.6%) | | Total comprehensive income (loss) | 82.4 | (13.1) | 730.5% | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) | Metric | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 12,045.2 | 12,037.4 | 0.1% | | Cash and cash equivalents | 462.8 | 576.2 | (19.7%) | | Trade and other receivables, net | 944.6 | 731.5 | 29.1% | | Total Current Assets | 1,884.8 | 1,814.0 | 3.9% | | Goodwill | 4,528.8 | 4,537.0 | (0.2%) | | Total Liabilities | 6,486.2 | 6,528.0 | (0.6%) | | Total Stockholders' Equity | 5,068.6 | 5,019.0 | 1.0% | [Condensed Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Temporary%20Equity%20and%20Stockholders'%20Equity) | Metric | Balance, Dec 31, 2023 (Millions USD) | Net Income (Millions USD) | Other Comprehensive Loss (Millions USD) | Dividends Paid (Millions USD) | Balance, Mar 31, 2024 (Millions USD) | | :--- | :--- | :--- | :--- | :--- | :--- | | Retained Earnings | 918.5 | 107.4 | — | (57.8) | 967.7 | | Accumulated Other Comprehensive Loss | (44.0) | — | (25.0) | — | (69.0) | | Total Stockholders' Equity | 5,019.0 | 107.4 | (25.0) | (57.8) | 5,068.6 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) | Cash Flow Activity | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | 124.8 | (57.3) | 318% | | Net cash used in investing activities | (77.5) | (2,823.0) | (97%) | | Net cash (used in) provided by financing activities | (190.9) | 2,958.5 | (106%) | | Net (Decrease) Increase in cash, cash equivalents, and restricted cash | (150.5) | 81.1 | (286%) | | Cash and cash equivalents, and restricted cash, end of period | 597.4 | 707.0 | (15.5%) | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed disclosures and explanations for the condensed consolidated financial statements - RB Global is a leading omnichannel marketplace for commercial assets and vehicles worldwide, operating in 13 countries with a digital platform serving over 170 countries[18](index=18&type=chunk) - Key brands include **Ritchie Bros., IAA, Rouse Services, SmartEquip, and VeriTread**[19](index=19&type=chunk) - The unaudited condensed consolidated interim financial statements are prepared in accordance with **US GAAP**, following the same accounting policies as the 2023 annual audited consolidated financial statements[21](index=21&type=chunk)[22](index=22&type=chunk) - The company is evaluating the impact of new FASB ASUs **2023-09 (Income Taxes)** and **2023-07 (Segment Reporting)**, effective for fiscal years beginning after December 15, 2024, and December 15, 2023 (interim periods after Dec 15, 2024) respectively[24](index=24&type=chunk)[25](index=25&type=chunk) [1. Description of Business and Basis of Preparation](index=10&type=section&id=1.%20Description%20of%20Business%20and%20Basis%20of%20Preparation) - RB Global is a leading omnichannel marketplace for commercial assets and vehicles worldwide, with auction sites in **13 countries** and a digital platform serving over **170 countries**[18](index=18&type=chunk) - Key brands include **Ritchie Bros., IAA, Rouse Services, SmartEquip, and VeriTread**[19](index=19&type=chunk) - The unaudited condensed consolidated interim financial statements are prepared in accordance with **US GAAP**, consistent with the Company's audited consolidated financial statements for the year ended December 31, 2023[21](index=21&type=chunk)[22](index=22&type=chunk) [2. Recent Accounting Pronouncements](index=10&type=section&id=2.%20Recent%20Accounting%20Pronouncements) - **ASU 2023-09 (Income Taxes)** requires enhanced annual disclosures for rate reconciliations and income taxes paid, effective for fiscal years beginning after December 15, 2024[24](index=24&type=chunk) - **ASU 2023-07 (Segment Reporting)** requires enhanced disclosure of significant segment expenses, effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024[25](index=25&type=chunk) [3. Business Combinations](index=11&type=section&id=3.%20Business%20Combinations) - The company completed its acquisition of IAA, Inc ('IAA') on March 20, 2023, for a total purchase price of approximately **$6.6 billion**, aiming to create a leading omnichannel marketplace[26](index=26&type=chunk) - The IAA acquisition resulted in **$3,546.6 million in goodwill**, attributed to expected synergies and IAA's assembled workforce[31](index=31&type=chunk)[32](index=32&type=chunk) - On January 3, 2023, the company acquired **75% control of VeriTread for $25.1 million** cash consideration, with **$25.2 million in goodwill** recognized, expected to accelerate the company's marketplace strategy[33](index=33&type=chunk)[36](index=36&type=chunk) [IAA Acquisition](index=11&type=section&id=IAA%20Acquisition) - Acquisition of IAA, Inc completed on March 20, 2023, for approximately **$6.6 billion**[26](index=26&type=chunk) - Consideration included **$1,714.2 million cash**, **$3,712.9 million fair value of common shares issued**, and repayment of **$1,157.1 million of IAA's net debt**[27](index=27&type=chunk)[29](index=29&type=chunk) - Goodwill acquired on acquisition was **$3,546.6 million**, related to expected synergies and IAA's assembled workforce[31](index=31&type=chunk)[32](index=32&type=chunk) [VeriTread Acquisition](index=14&type=section&id=VeriTread%20Acquisition) - Acquired **75% control of VeriTread** on January 18, 2023, for **$25.1 million** cash consideration[33](index=33&type=chunk) - Goodwill acquired on acquisition was **$25.2 million**, expected to accelerate the company's marketplace strategy[36](index=36&type=chunk) - A redeemable non-controlling interest of **21%** is classified in temporary equity due to a probable put/call agreement[34](index=34&type=chunk) [4. Segment Information](index=15&type=section&id=4.%20Segment%20Information) - The company operates as a **single operating and reportable segment**, with the CEO (CODM) reviewing performance and allocating resources at the consolidated level[37](index=37&type=chunk) | Region | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | | :--- | :--- | :--- | | United States | 791.2 | 360.1 | | Canada | 142.4 | 68.3 | | Europe | 87.1 | 50.7 | | Australia | 27.6 | 19.1 | | Other | 16.4 | 14.2 | | **Consolidated** | **1,064.7** | **512.4** | [5. Revenue](index=15&type=section&id=5.%20Revenue) - Revenue sources include commissions from consignors, buyer fees from purchasers, and marketplace services revenue (e.g, refurbishing, parts procurement, data, transportation, financing)[39](index=39&type=chunk) - Approximately **23% of consolidated revenues** in Q1 2024 were associated with vehicles supplied by the company's three largest provider customers[40](index=40&type=chunk) | Revenue Type | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Commissions | 227.4 | 130.6 | 74% | | Buyer fees | 502.7 | 140.7 | 257% | | Marketplace services revenue | 119.0 | 72.3 | 65% | | **Total service revenue** | **849.1** | **343.6** | **147%** | | Inventory sales revenue | 215.6 | 168.8 | 28% | | **Total revenue** | **1,064.7** | **512.4** | **108%** | [6. Operating Expenses](index=16&type=section&id=6.%20Operating%20Expenses) | Expense Type | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Costs of services | 353.0 | 76.4 | 362% | | Cost of inventory sold | 196.6 | 151.5 | 30% | | Selling, general and administrative | 198.1 | 148.2 | 34% | | Acquisition-related and integration costs | 12.8 | 126.2 | (90%) | | Depreciation and amortization | 107.7 | 36.2 | 198% | | **Total operating expenses** | **868.2** | **538.5** | **61%** | [Acquisition-Related and Integration Costs](index=16&type=section&id=Acquisition-Related%20and%20Integration%20Costs) - The significant decrease is due to the **non-recurrence of substantial financing, investment banking, and legal costs** associated with the IAA acquisition in the prior year[134](index=134&type=chunk) | Cost Type (IAA) | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Financing | — | 30.0 | (100%) | | Severance | 5.2 | 14.0 | (62.9%) | | Integration | 5.4 | 5.1 | 5.9% | | Investment banking, consulting and other acquisition-related costs | 1.1 | 61.6 | (98.2%) | | **Total acquisition-related and integration costs** | **12.8** | **126.2** | **(90%)** | [Depreciation and Amortization](index=16&type=section&id=Depreciation%20and%20Amortization) - The increase is primarily driven by **higher amortization costs**, reflecting the impact of recent business combinations[136](index=136&type=chunk) | Expense Type | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Depreciation | 24.9 | 11.5 | 116.5% | | Amortization | 82.8 | 24.7 | 235.2% | | **Total** | **107.7** | **36.2** | **198.0%** | [7. Income Taxes](index=16&type=section&id=7.%20Income%20Taxes) - Income tax expense for Q1 2024 was **$32.5 million**, compared to a benefit of $9.3 million in Q1 2023, with an effective tax rate of **23.2%**[9](index=9&type=chunk)[139](index=139&type=chunk) - The effective tax rate variance from the Canadian statutory rate (27.0%) is primarily due to estimated income taxed in jurisdictions with lower tax rates, deductions for share-based payments, and a benefit related to **Foreign-Derived Intangible Income (FDII)**[46](index=46&type=chunk) - The Canada Revenue Agency (CRA) has issued a proposal letter asserting a Luxembourg subsidiary was resident in Canada from 2010-2015, potentially leading to **$26.0 million - $30.0 million in additional Canadian income tax**, exclusive of interest and penalties[49](index=49&type=chunk) [8. Earnings (Loss) Per Share Available to Common Stockholders](index=18&type=section&id=8.%20Earnings%20(Loss)%20Per%20Share%20Available%20to%20Common%20Stockholders) - Potentially dilutive securities include unvested performance-based restricted share units (PSUs), unvested restricted share units (RSUs), outstanding stock options, and stock committed under the Employee Stock Purchase Plan[52](index=52&type=chunk) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income (loss) available to common stockholders | $97.1 million | $(34.2) million | | Basic weighted average share outstanding | 183,059,321 | 120,487,251 | | Diluted average shares outstanding | 184,581,054 | 120,487,251 | | Basic EPS | $0.53 | $(0.28) | | Diluted EPS | $0.53 | $(0.28) | [9. Supplemental Cash Flow Information](index=19&type=section&id=9.%20Supplemental%20Cash%20Flow%20Information) [Net Changes in Operating Assets and Liabilities](index=19&type=section&id=Net%20Changes%20in%20Operating%20Assets%20and%20Liabilities) | Item | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | | :--- | :--- | :--- | | Trade and other receivables | (220.0) | (104.3) | | Prepaid consigned vehicle charges | 6.4 | (14.2) | | Inventory | (13.0) | (46.4) | | Auction proceeds payable | 165.0 | 118.2 | | Trade and other liabilities | (62.1) | 38.9 | | **Net changes in operating assets and liabilities** | **(141.8)** | **(86.8)** | [Interest and Tax Payments](index=19&type=section&id=Interest%20and%20Tax%20Payments) | Item | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | | :--- | :--- | :--- | | Interest paid, net of interest capitalized | 85.6 | 20.4 | | Interest received | 6.6 | 6.3 | | Net income taxes paid | 23.0 | 50.9 | [10. Fair Value Measurement](index=19&type=section&id=10.%20Fair%20Value%20Measurement) - The fair value of derivative financial assets (forward currency contracts) is determined using observable **Level 2 inputs**, including foreign currency spot exchange rates and forward pricing curves[57](index=57&type=chunk) - A contingent consideration liability of **$5.3 million** (March 31, 2024) related to a previous acquisition is recorded at fair value[59](index=59&type=chunk) | Instrument | Carrying Amount (Millions USD) | Fair Value (Millions USD) | Valuation Level | | :--- | :--- | :--- | :--- | | Loans receivable | 41.4 | 41.3 | Level 2 | | Derivative financial assets | 0.1 | 0.1 | Level 2 | | 2023 Secured Notes | 543.6 | 560.0 | Level 1 | | 2023 Unsecured Notes | 789.8 | 837.0 | Level 1 | | Term loans | 1,592.8 | 1,605.1 | Level 2 | [11. Derivative Financial Instruments](index=21&type=section&id=11.%20Derivative%20Financial%20Instruments) - The company uses **forward currency contracts** to manage exposure to foreign currency exchange rate fluctuations on monetary loan receivables and significant intercompany balances[60](index=60&type=chunk) - The gross total notional amount of forward currency contracts was **$38.9 million** as of March 31, 2024[60](index=60&type=chunk) - An unrealized loss of **$0.3 million** was recognized within foreign exchange loss in the condensed consolidated income statement for Q1 2024[60](index=60&type=chunk) [12. Trade and Other Receivables](index=21&type=section&id=12.%20Trade%20and%20Other%20Receivables) - The allowance for expected credit losses increased from $6.4 million at December 31, 2023, to **$8.4 million** at March 31, 2024, with a current period provision of $3.2 million[62](index=62&type=chunk) - Loans receivable totaled **$41.4 million** at March 31, 2024, are fully collateralized by equipment, and have terms of one to four years[63](index=63&type=chunk) | Item | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :--- | :--- | :--- | | Advanced charges receivable | 354.5 | 374.7 | | Trade accounts receivable | 559.7 | 315.8 | | Loans receivable | 22.4 | 21.8 | | **Trade and other receivables, gross** | **953.0** | **737.9** | | Less: allowance for credit losses | (8.4) | (6.4) | | **Trade and other receivables, net** | **944.6** | **731.5** | [13. Trade and Other Liabilities](index=22&type=section&id=13.%20Trade%20and%20Other%20Liabilities) | Item | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :--- | :--- | :--- | | Accrued liabilities | 210.3 | 294.5 | | Trade payables | 138.8 | 138.9 | | Book overdrafts | 134.2 | 129.1 | | Deferred revenue | 21.2 | 17.5 | | Taxes payable | 70.1 | 63.7 | | **Total** | **618.6** | **685.8** | [14. Debt](index=22&type=section&id=14.%20Debt) - The company repaid **$150.0 million of principal** on the USD TLA Facility during Q1 2024, with no mandatory principal repayments remaining until maturity in September 2026[69](index=69&type=chunk)[161](index=161&type=chunk) - At March 31, 2024, the company had **$712.8 million in unused committed revolving credit facilities** and was in compliance with all financial and other covenants[66](index=66&type=chunk)[166](index=166&type=chunk) | Debt Type | March 31, 2024 (Millions USD) | December 31, 2023 (Millions USD) | | :--- | :--- | :--- | | Short-term debt | 24.8 | 13.7 | | Long-term debt | 2,926.2 | 3,075.8 | | **Total debt** | **2,951.0** | **3,089.5** | [15. Temporary Equity, Equity and Dividends](index=24&type=section&id=15.%20Temporary%20Equity%2C%20Equity%20and%20Dividends) - The company has unlimited common shares (no par value) and **485,000,000 Series A Senior Preferred Shares** authorized, issued, and outstanding[72](index=72&type=chunk)[73](index=73&type=chunk) - Series A Senior Preferred Shares are convertible into common stock at **$71.58 per share** (as of March 31, 2024), carry a **5.5% preferential dividend**, and participate in common share dividends[74](index=74&type=chunk) - Redeemable non-controlling interest relates to a **21% interest in VeriTread**, classified as temporary equity due to a probable put/call agreement[78](index=78&type=chunk) - Common stock dividends paid in Q1 2024 totaled **$49.3 million ($0.27 per share)**, while preferred stock dividends totaled **$8.5 million** ($6.7 million preferential, $1.8 million participating)[79](index=79&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk) [16. Share-based Payments](index=26&type=section&id=16.%20Share-based%20Payments) - In March 2024, **276,276 equity-settled PSUs** were granted to executives and senior employees, vesting over three years based on performance and market conditions[88](index=88&type=chunk) - During Q1 2024, **263,930 equity-settled RSUs** were granted, not subject to market vesting conditions[93](index=93&type=chunk) | Expense Type | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | | :--- | :--- | :--- | | Selling, general and administrative | 14.0 | 6.7 | | Acquisition-related and integration costs | 1.1 | 6.0 | | **Total** | **15.1** | **12.7** | [17. Leases](index=27&type=section&id=17.%20Leases) - The company enters into commercial leases for various properties (auction sites, offices) and operating leases for equipment (computers, motor vehicles)[94](index=94&type=chunk) | Lease Cost Type | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | | :--- | :--- | :--- | | Operating lease cost | 60.8 | 13.1 | | Finance lease cost (Amortization + Interest) | 3.1 | 5.7 | | Short-term lease cost | 5.4 | 3.4 | | Sublease income | (0.2) | (0.1) | | **Total** | **69.1** | **22.1** | [18. Contingencies](index=28&type=section&id=18.%20Contingencies) - The company is in a dispute with its former CEO, Ann Fandozzi, regarding her resignation and compensation; an expense of **$1.3 million** was recorded in Q1 2024 for changes to estimated share-based payment awards, and the final settlement could be material[97](index=97&type=chunk)[98](index=98&type=chunk) - At March 31, 2024, **$79.7 million of assets were guaranteed** under contract to consignors, with **98%** expected to be sold prior to June 30, 2024[101](index=101&type=chunk) [ITEM 2: Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=ITEM%202%3A%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides a comprehensive analysis of RB Global's financial condition and results of operations for Q1 2024 [Overview of Business, Macroeconomic Conditions and Service Offerings](index=29&type=section&id=Overview%20of%20Business%2C%20Macroeconomic%20Conditions%20and%20Service%20Offerings) - RB Global is a leading global marketplace for commercial assets and vehicles, primarily serving the **automotive, construction, and commercial transportation sectors** through an omnichannel platform[108](index=108&type=chunk)[110](index=110&type=chunk) - The business is impacted by macroeconomic conditions, including **inflationary pressures** on operating costs and **interest rate volatility** on variable rate long-term debt[111](index=111&type=chunk) - The company offers various contract options (straight commission, fixed commission, guarantee commission, and inventory contracts) and value-added services such as refurbishment, parts procurement, data intelligence, and financial services[113](index=113&type=chunk)[114](index=114&type=chunk) [Performance Overview and Consolidated Results](index=32&type=section&id=Performance%20Overview%20and%20Consolidated%20Results) - Net income available to common stockholders **increased 384% to $97.1 million** in Q1 2024 from a $34.2 million loss in Q1 2023[118](index=118&type=chunk) - Total GTV **increased 115% to $4.1 billion**, including $2.3 billion from IAA, and total revenue **increased 108% to $1.1 billion**, including $588.6 million from IAA[119](index=119&type=chunk) - Adjusted EBITDA **increased 150% to $331.0 million**, and diluted adjusted EPS available to common stockholders **increased 58% to $0.90 per share**[118](index=118&type=chunk)[119](index=119&type=chunk) [Results of Operations Analysis](index=33&type=section&id=Results%20of%20Operations%20Analysis) - **IAA contributed 90% of the increase in Total GTV** and **92% of the increase in Total Revenue**, significantly impacting year-over-year comparisons due to its full-quarter inclusion in Q1 2024[122](index=122&type=chunk)[123](index=123&type=chunk) - Operating income **increased 899% to $198.9 million**, primarily driven by the decrease in significant acquisition-related and integration costs and the inclusion of IAA's operating income[135](index=135&type=chunk)[136](index=136&type=chunk) | Metric | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 1,064.7 | 512.4 | 108% | | Service Revenue | 849.1 | 343.6 | 147% | | Inventory Sales Revenue | 215.6 | 168.8 | 28% | | Total Operating Expenses | 868.2 | 538.5 | 61% | | Operating Income (Loss) | 198.9 | (24.9) | 899% | | Net Income (Loss) | 107.4 | (28.2) | 481% | | Total GTV | 4,077.4 | 1,899.2 | 115% | | Effective Tax Rate | 23.2% | 24.8% | (160)bps | [Total GTV](index=34&type=section&id=Total%20GTV) - Total GTV **increased 115% to $4.1 billion** in Q1 2024, with IAA accounting for **90% ($2.0 billion)** of this increase due to its full-quarter inclusion[122](index=122&type=chunk) - Excluding IAA, total GTV **increased 13% to $1.8 billion**, driven by higher lot volumes from strategic accounts, particularly in the United States[122](index=122&type=chunk) | Region | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | United States | 3,261.8 | 1,400.9 | 133% | | Canada | 553.5 | 291.9 | 90% | | International | 262.1 | 206.4 | 27% | | **Total GTV** | **4,077.4** | **1,899.2** | **115%** | [Total Revenue](index=34&type=section&id=Total%20Revenue) - Total revenue **increased 108% to $1.1 billion** in Q1 2024, with IAA contributing **$508.7 million (92%)** of the increase[123](index=123&type=chunk) - Service revenue **increased 147%**, and inventory sales revenue **increased 28%**[123](index=123&type=chunk) - Excluding IAA, total revenue **increased 10% to $476.1 million**[123](index=123&type=chunk) [Service Revenue](index=34&type=section&id=Service%20Revenue) - Buyer fees **increased 257%**, primarily due to IAA's full-quarter inclusion, contributing **$340.4 million (94%)** of the increase, and changes in buyer fee structure[127](index=127&type=chunk) - Commissions revenue **increased 74%**, with IAA contributing **$77.8 million (80%)** of the increase, despite IAA earning lower commission rates[128](index=128&type=chunk) | Revenue Type | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Commissions | 227.4 | 130.6 | 74% | | Buyer fees | 502.7 | 140.7 | 257% | | Marketplace services revenue | 119.0 | 72.3 | 65% | | **Total service revenue** | **849.1** | **343.6** | **147%** | [Inventory Sales Revenue](index=35&type=section&id=Inventory%20Sales%20Revenue) - Inventory sales revenue **increased 28%** in Q1 2024, primarily due to the inclusion of IAA for a full quarter, which contributed **126%** of the increase[130](index=130&type=chunk) - Excluding IAA, inventory sales revenue decreased due to a lower mix of inventory contracts in the United States, partially offset by an increase in Canada[130](index=130&type=chunk) [Costs of Services](index=35&type=section&id=Costs%20of%20Services) - Costs of services **increased 362% to $353.0 million** in Q1 2024, with IAA's full-quarter inclusion accounting for **95%** of the increase[131](index=131&type=chunk) - The increase also reflects higher costs for transportation services and profit-sharing arrangements related to a large consignor contract in the United States[131](index=131&type=chunk) [Cost of Inventory Sold](index=35&type=section&id=Cost%20of%20Inventory%20Sold) - Cost of inventory sold **increased 30% to $196.6 million** in Q1 2024, generally in line with the **28% increase** in inventory sales revenue[132](index=132&type=chunk) - The increase rate was slightly higher than sales revenue due to softer performance on North American inventory contracts, partially offset by higher inventory rates on assets sold through the GovPlanet business[132](index=132&type=chunk) [Selling, General and Administrative](index=35&type=section&id=Selling%2C%20General%20and%20Administrative) - Selling, general and administrative (SG&A) expenses **increased 34% to $198.1 million** in Q1 2024, with IAA's inclusion contributing **75%** of this rise[133](index=133&type=chunk) - The remaining increase was driven by higher employee compensation (including share-based payments and benefits), investments in sales coverage teams, and technology modernization[133](index=133&type=chunk) - These increases were partially offset by lower travel, advertising, and promotion costs[133](index=133&type=chunk) [Acquisition-related and Integration Costs](index=35&type=section&id=Acquisition-related%20and%20Integration%20Costs) - Acquisition-related and integration costs **decreased 90% to $12.8 million** in Q1 2024, down from $126.2 million in Q1 2023[134](index=134&type=chunk) - This significant reduction is due to the **non-recurrence of substantial acquisition-related costs** (investment banking, consulting, financing, legal) incurred for the IAA acquisition in the prior year, and lower severance costs[134](index=134&type=chunk) [Operating Income (Loss)](index=35&type=section&id=Operating%20Income%20(Loss)) - Operating income **increased 899% to $198.9 million** in Q1 2024, reversing a $24.9 million loss in Q1 2023[135](index=135&type=chunk) - This improvement was primarily driven by the **decrease in significant acquisition-related and integration costs** and the full-quarter inclusion of operating income from IAA[135](index=135&type=chunk)[136](index=136&type=chunk) - The increase was partially offset by higher depreciation and amortization driven by the acquisition of IAA[136](index=136&type=chunk) [Income Tax Expense (Benefit) and Effective Tax Rate](index=37&type=section&id=Income%20Tax%20Expense%20(Benefit)%20and%20Effective%20Tax%20Rate) - Income tax expense for Q1 2024 was **$32.5 million**, compared to a benefit of $9.3 million in Q1 2023[139](index=139&type=chunk) - The effective tax rate for Q1 2024 was **23.2%**, favorably impacted by estimated income taxed in lower tax rate jurisdictions, higher benefit related to Foreign-Derived Intangible Income (FDII), and lower estimated non-deductible expenses[138](index=138&type=chunk) [Net Income (Loss) Attributable to Controlling Interests](index=37&type=section&id=Net%20Income%20(Loss)%20Attributable%20to%20Controlling%20Interests) - Net income attributable to controlling interests **increased 481% to $107.4 million** in Q1 2024, from a $28.1 million loss in Q1 2023[140](index=140&type=chunk) - This increase was primarily driven by **higher operating income**, partially offset by higher interest expense (due to debt financing for IAA acquisition and rising rates) and higher income tax expense[140](index=140&type=chunk) [Diluted EPS](index=37&type=section&id=Diluted%20EPS) - Diluted EPS available to common stockholders **increased 289% to $0.53 per share** for Q1 2024, compared to a $0.28 loss per share for Q1 2023[141](index=141&type=chunk) - The increase was primarily due to the increase in net income attributable to controlling interests, partially offset by an increase in the number of shares issued for the acquisition of IAA[141](index=141&type=chunk) [U.S. Dollar Exchange Rate Comparison](index=37&type=section&id=U.S.%20Dollar%20Exchange%20Rate%20Comparison) - Foreign exchange fluctuations had an **unfavorable impact on total revenue** and a **favorable impact on expenses** in Q1 2024 compared to Q1 2023[142](index=142&type=chunk) - These impacts were primarily due to fluctuations in the British pound sterling, Canadian dollar, Euro, and Australian dollar exchange rates relative to the U.S dollar[142](index=142&type=chunk) | Currency | 2024 Average | 2023 Average | % Change (2024 over 2023) | | :--- | :--- | :--- | :--- | | Canadian dollar | 0.7419 | 0.7397 | — % | | Euro | 1.0861 | 1.0732 | 1 % | | British pound sterling | 1.2683 | 1.2146 | 4 % | | Australian dollar | 0.6579 | 0.6841 | (4)% | [Non-GAAP Measures and Key Operating Metrics](index=38&type=section&id=Non-GAAP%20Measures%20and%20Key%20Operating%20Metrics) - Adjusted net income available to common stockholders **increased 139% to $165.5 million**, diluted adjusted EPS **increased 58% to $0.90 per share**, and adjusted EBITDA **increased 150% to $331.0 million** in Q1 2024[145](index=145&type=chunk)[146](index=146&type=chunk)[147](index=147&type=chunk) | Sector | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Automotive | 2,113.7 | 331.7 | 537% | | Commercial construction and transportation | 1,562.8 | 1,190.0 | 31% | | Other | 400.9 | 377.5 | 6% | | **Total GTV** | **4,077.4** | **1,899.2** | **115%** | | Sector | Q1 2024 (Thousands of lots) | Q1 2023 (Thousands of lots) | Change (%) | | :--- | :--- | :--- | :--- | | Automotive | 585.3 | 87.5 | 569% | | Commercial construction and transportation | 108.8 | 56.6 | 92% | | Other | 112.5 | 105.2 | 7% | | **Total Lots Sold** | **806.6** | **249.3** | **224%** | [Key Operating Metrics Definitions](index=38&type=section&id=Key%20Operating%20Metrics%20Definitions) - **Gross transaction value (GTV)** represents total proceeds from all items sold at the company's auctions and online marketplaces[150](index=150&type=chunk) - **Total service revenue take rate** is total service revenue divided by total GTV[151](index=151&type=chunk) - **Inventory return** is inventory sales revenue less cost of inventory sold, and **inventory rate** is inventory return divided by inventory sales revenue[152](index=152&type=chunk)[153](index=153&type=chunk) [GTV by Sector](index=38&type=section&id=GTV%20by%20Sector) - The **537% increase** in the automotive sector's GTV was primarily due to the inclusion of IAA for a full quarter[155](index=155&type=chunk) - Commercial construction and transportation GTV **increased 31%**, mainly driven by higher lot volumes from strategic accounts in the United States[155](index=155&type=chunk) | Sector | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Automotive | 2,113.7 | 331.7 | 537% | | Commercial construction and transportation | 1,562.8 | 1,190.0 | 31% | | Other | 400.9 | 377.5 | 6% | | **Total GTV** | **4,077.4** | **1,899.2** | **115%** | [Total Lots Sold by Sector](index=39&type=section&id=Total%20Lots%20Sold%20by%20Sector) - The **569% increase** in automotive lots sold was due to the inclusion of IAA for a full quarter[159](index=159&type=chunk) - Commercial construction and transportation lots sold **increased 92%**, mainly driven by a higher proportion of low-value lots in the United States and the inclusion of IAA[159](index=159&type=chunk) | Sector | Q1 2024 (Thousands of lots) | Q1 2023 (Thousands of lots) | Change (%) | | :--- | :--- | :--- | :--- | | Automotive | 585.3 | 87.5 | 569% | | Commercial construction and transportation | 108.8 | 56.6 | 92% | | Other | 112.5 | 105.2 | 7% | | **Total Lots Sold** | **806.6** | **249.3** | **224%** | [Financial Condition: Debt, Liquidity and Capital Resources](index=39&type=section&id=Financial%20Condition%3A%20Debt%2C%20Liquidity%20and%20Capital%20Resources) - Total debt decreased to **$2,951.0 million** at March 31, 2024, from $3,089.5 million at December 31, 2023, following a **$150.0 million repayment** on the USD TLA Facility[65](index=65&type=chunk)[161](index=161&type=chunk) - The company maintains strong liquidity with **$717.8 million in unused revolving credit facilities** and was in compliance with all debt covenants at March 31, 2024[162](index=162&type=chunk)[166](index=166&type=chunk)[171](index=171&type=chunk) - Net cash provided by operating activities significantly improved to **$124.8 million** in Q1 2024 from a $57.3 million outflow in Q1 2023[173](index=173&type=chunk) - The Debt/Net Income ratio improved to **8.6x** at March 31, 2024, from 28.6x at March 31, 2023, due to higher net income and slightly lower debt levels[177](index=177&type=chunk) [Debt Structure and Covenants](index=39&type=section&id=Debt%20Structure%20and%20Covenants) - The company's credit agreement, including multicurrency revolving facilities and the Term Loan A facility (USD and CAD), matures on **September 21, 2026**[160](index=160&type=chunk) - A **$150.0 million principal repayment** was made on the USD TLA Facility during Q1 2024, with no mandatory principal repayments remaining until maturity[161](index=161&type=chunk) - At March 31, 2024, the company had **$712.8 million in unused committed revolving credit facilities** and was in compliance with all financial and other covenants[66](index=66&type=chunk)[166](index=166&type=chunk) [Liquidity and Capital Resources Management](index=41&type=section&id=Liquidity%20and%20Capital%20Resources%20Management) - The company believes its existing working capital and **$717.8 million in unused revolving credit facilities** are sufficient to satisfy present operating requirements and contractual obligations[169](index=169&type=chunk)[171](index=171&type=chunk) - Short-term cash requirements include dividends, consignor settlements, personnel, income taxes, debt payments, IT architecture, lease obligations, capital expenditures, working capital, and advances[168](index=168&type=chunk) - Long-term cash requirements include scheduled principal repayments of **$1.6 billion on the TLA Facility** and **$1.4 billion on the 2023 Notes**, as well as operating and finance lease obligations[170](index=170&type=chunk) [Cash Flows Analysis](index=42&type=section&id=Cash%20Flows%20Analysis) - Net cash provided by operating activities **increased $182.1 million**, mainly due to higher net income from IAA's full-quarter inclusion and lower acquisition-related costs[173](index=173&type=chunk) - Net cash used in investing activities **decreased significantly** due to the non-recurrence of cash used for the IAA and VeriTread acquisitions in the prior quarter[174](index=174&type=chunk) | Cash Flow Activity | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Operating activities | 124.8 | (57.3) | 318% | | Investing activities | (77.5) | (2,823.0) | (97%) | | Financing activities | (190.9) | 2,958.5 | (106%) | | Effect of changes in foreign currency rates | (6.9) | 2.9 | (338%) | | **Net decrease in cash, cash equivalents, and restricted cash** | **(150.5)** | **81.1** | **(286%)** | [Dividend Information](index=42&type=section&id=Dividend%20Information) - The company declared a quarterly dividend of **$0.27 per common share** for the quarter ended March 31, 2024, consistent with previous quarters[176](index=176&type=chunk) - A special dividend of **$1.08 per common share** was paid in Q1 2023 in connection with the IAA acquisition[79](index=79&type=chunk)[175](index=175&type=chunk) [Debt over Net Income](index=42&type=section&id=Debt%20over%20Net%20Income) - The Debt/Net Income ratio significantly improved to **8.6x** at March 31, 2024, from 28.6x at March 31, 2023, a **70% decrease**[177](index=177&type=chunk)[191](index=191&type=chunk) - The Adjusted Net Debt/Adjusted EBITDA ratio decreased to **2.0x** at March 31, 2024, from 5.4x at March 31, 2023, a **63% decrease**[177](index=177&type=chunk)[191](index=191&type=chunk) - This improvement is attributed to higher net income from IAA's inclusion and slightly lower debt levels due to TLA Facility repayments[177](index=177&type=chunk) [Critical Accounting Policies and Non-GAAP Reconciliations](index=43&type=section&id=Critical%20Accounting%20Policies%20and%20Non-GAAP%20Reconciliations) - No material changes to critical accounting policies, judgments, estimates, and assumptions were reported from the prior annual report[178](index=178&type=chunk) - Beginning Q1 2024, the company **no longer reports non-GAAP adjusted operating income** and non-GAAP operating free cash flow[180](index=180&type=chunk) - Adjusted net income available to common stockholders **increased 139% to $165.5 million**, diluted adjusted EPS **increased 58% to $0.90 per share**, and adjusted EBITDA **increased 150% to $331.0 million** in Q1 2024[145](index=145&type=chunk)[146](index=146&type=chunk)[147](index=147&type=chunk) - Adjusted ROIC significantly improved to **9.7%** for the trailing twelve months ended March 31, 2024, from 5.9% in the prior year[195](index=195&type=chunk) [Critical Accounting Policies, Judgments, Estimates and Assumptions](index=43&type=section&id=Critical%20Accounting%20Policies%2C%20Judgments%2C%20Estimates%20and%20Assumptions) - There were **no material changes** in critical accounting policies, judgments, estimates, and assumptions from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023[178](index=178&type=chunk) [Adjusted Net Income Available to Common Stockholders and Diluted Adjusted EPS Available to Common Stockholders Reconciliation](index=44&type=section&id=Adjusted%20Net%20Income%20Available%20to%20Common%20Stockholders%20and%20Diluted%20Adjusted%20EPS%20Available%20to%20Common%20Stockholders%20Reconciliation) - Adjusted net income excludes effects of share-based payments expense, acquisition-related and integration costs, amortization of acquired intangible assets, executive transition costs, and certain other items[183](index=183&type=chunk) | Metric | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Net income (loss) available to common stockholders | 97.1 | (34.2) | 384% | | Adjusting items (net of tax and allocation) | 68.4 | 103.4 | (33.9%) | | **Adjusted net income available to common stockholders** | **165.5** | **69.2** | **139%** | | Diluted EPS available to common stockholders | $0.53 | $(0.28) | 289% | | **Diluted adjusted EPS available to common stockholders** | **$0.90** | **$0.57** | **58%** | [Adjusted EBITDA Reconciliation](index=45&type=section&id=Adjusted%20EBITDA%20Reconciliation) - Adjusted EBITDA is calculated by adding back depreciation and amortization, interest expense, income tax expense (benefit), and subtracting interest income from net income (loss), as well as adding back specific adjusting items[188](index=188&type=chunk) | Metric | Q1 2024 (Millions USD) | Q1 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Net income (loss) | 107.4 | (28.2) | 481% | | EBITDA | 304.9 | 13.3 | 2192% | | Adjusting items (total) | 26.1 | 119.3 | (78.1%) | | **Adjusted EBITDA** | **331.0** | **132.6** | **150%** | [Adjusted Net Debt and Adjusted Net Debt/Adjusted EBITDA Reconciliation](index=46&type=section&id=Adjusted%20Net%20Debt%20and%20Adjusted%20Net%20Debt%2FAdjusted%20EBITDA%20Reconciliation) - The decrease in the Adjusted Net Debt/Adjusted EBITDA multiplier was due to higher net income from the inclusion of IAA's net income and slightly lower levels of debt driven by repayments[177](index=177&type=chunk) | Metric | TTM Mar 31, 2024 (Millions USD) | TTM Mar 31, 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Debt | 2,951.0 | 3,244.0 | (9%) | | Less: cash and cash equivalents | (462.8) | (568.3) | (19%) | | **Adjusted net debt** | **2,488.2** | **2,675.7** | **(7%)** | | Adjusted EBITDA | 1,231.5 | 492.8 | 150% | | **Adjusted net debt/adjusted EBITDA** | **2.0 x** | **5.4 x** | **(63%)** | [Adjusted Return and Adjusted ROIC Reconciliation](index=47&type=section&id=Adjusted%20Return%20and%20Adjusted%20ROIC%20Reconciliation) - Adjusted ROIC is used by management to determine how productively the company uses its long-term capital and to gauge investment decisions[192](index=192&type=chunk) | Metric | TTM Mar 31, 2024 (Millions USD) | TTM Mar 31, 2023 (Millions USD) | Change (%) | | :--- | :--- | :--- | :--- | | Reported return | 519.6 | 147.7 | 252% | | Adjusting items (net of tax) | 305.9 | 163.8 | 86.7% | | **Adjusted return** | **825.5** | **311.5** | **165%** | | Adjusted average invested capital | 8,543.4 | 5,238.5 | 63% | | ROIC | 6.1% | 2.6% | 350bps | | **Adjusted ROIC** | **9.7%** | **5.9%** | **380bps** | [Adjusting Items](index=49&type=section&id=Adjusting%20Items) - Q1 2024 adjusting items include **$13.3 million share-based payments expense**, **$12.8 million acquisition-related and integration costs**, **$69.6 million amortization of acquired intangible assets** (primarily from IAA), and **$1.7 million executive transition costs**[196](index=196&type=chunk) - Q4 2023 adjusting items included **$13.8 million share-based payments expense**, **$20.5 million acquisition-related and integration costs**, **$69.6 million amortization of acquired intangible assets**, and **$2.2 million executive transition costs**[197](index=197&type=chunk) - Q3 2023 adjusting items included **$12.7 million share-based payments expense**, **$23.1 million acquisition-related and integration costs**, **$63.9 million amortization of acquired intangible assets**, and **$9.8 million executive transition costs**[198](index=198&type=chunk) [ITEM 3: Quantitative and Qualitative Disclosures About Market Risk](index=52&type=section&id=ITEM%203%3A%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There have been no material changes to the company's market risk disclosures during Q1 2024 - **No material changes** to market risk disclosures in Q1 2024 from the Annual Report on Form 10-K for December 31, 2023[207](index=207&type=chunk) [ITEM 4: Controls and Procedures](index=52&type=section&id=ITEM%204%3A%20Controls%20and%20Procedures) The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2024 - CEO and CFO concluded that disclosure controls and procedures were **effective as of March 31, 2024**, providing reasonable assurance for timely and accurate reporting[208](index=208&type=chunk)[209](index=209&type=chunk) - **No material changes** in internal control over financial reporting occurred during Q1 2024, apart from those related to the continued integration of IAA[211](index=211&type=chunk) [Disclosure Controls and Procedures](index=52&type=section&id=Disclosure%20Controls%20and%20Procedures) - The CEO and CFO evaluated and concluded that the company's disclosure controls and procedures were **effective as of March 31, 2024**[208](index=208&type=chunk)[209](index=209&type=chunk) - These controls are designed to ensure that information required for SEC filings is accumulated, communicated, and reported within specified time periods, providing reasonable assurance[208](index=208&type=chunk)[209](index=209&type=chunk) [Changes in Internal Control over Financial Reporting](index=53&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) - **No material changes** in the company's internal control over financial reporting occurred during Q1 2024[211](index=211&type=chunk) - The only exception relates to the **continued integration of IAA**, which was acquired on March 20, 2023[211](index=211&type=chunk) [PART II – OTHER INFORMATION](index=54&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [ITEM 1: Legal Proceedings](index=54&type=section&id=ITEM%201%3A%20Legal%20Proceedings) The company has no material legal proceedings pending, other than routine litigation incidental to its business - **No material legal proceedings** pending or contemplated by governmental authorities, beyond ordinary routine litigation incidental to the business[214](index=214&type=chunk) [ITEM 1A: Risk Factors](index=54&type=section&id=ITEM%201A%3A%20Risk%20Factors) As of the filing date, there have been no material changes to the risk factors previously disclosed - **No material changes** to risk factors as of the filing date, compared to the Annual Report on Form 10-K for December 31, 2023[215](index=215&type=chunk) - The business is subject to a number of risks and uncertainties, and past performance is no guarantee of future performance[215](index=215&type=chunk) [ITEM 2: Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=ITEM%202%3A%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report during Q1 2024 - None[216](index=216&type=chunk) [ITEM 3: Defaults Upon Senior Securities](index=54&type=section&id=ITEM%203%3A%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report during Q1 2024 - None[217](index=217&type=chunk) [ITEM 4: Mine Safety Disclosures](index=54&type=section&id=ITEM%204%3A%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[218](index=218&type=chunk) [ITEM 5: Other Information](index=54&type=section&id=ITEM%205%3A%20Other%20Information) No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement during Q1 2024 - None of the company's directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during Q1 2024[219](index=219&type=chunk) [ITEM 6: Exhibits](index=55&type=section&id=ITEM%206%3A%20Exhibits) This section lists the exhibits filed as part of the Quarterly Report on Form 10-Q - Exhibits include certifications from the Chief Executive Officer and Chief Financial Officer (pursuant to Rule 13a-14(a) and 18 U.S.C Section 1350) and Interactive Data Files (Inline XBRL) for the financial statements[222](index=222&type=chunk) [SIGNATURES](index=56&type=section&id=SIGNATURES) - The report is signed by **Jim Kessler, Chief Executive Officer**, and **Eric J. Guerin, Chief Financial Officer**, on May 9, 2024[226](index=226&type=chunk)

[RB Global First Quarter 2024 Results](index=1&type=section&id=RB%20Global%20reports%20first%20quarter%202024%20results) [Executive Summary & Outlook](index=1&type=section&id=Executive%20Summary%20%26%20Outlook) The company reports strong Q1 growth driven by the IAA acquisition, raises full-year guidance, and achieves its net leverage target early - CEO Jim Kessler attributed the solid start to the year to robust execution in the automotive sector[2](index=2&type=chunk) - The company **raised its full-year Adjusted EBITDA guidance** and met its net leverage target a year ahead of schedule[3](index=3&type=chunk) First Quarter 2024 Financial Highlights (YoY) | Metric | Value | Change (YoY) | | :--- | :--- | :--- | | GTV | $4.1 billion | +115% | | Total revenue | $1.1 billion | +108% | | Service revenue | $849.1 million | +147% | | Inventory sales revenue | $215.6 million | +28% | | Net income available to common stockholders | $97.1 million | +384% | | Diluted EPS available to common stockholders | $0.53 | +289% | | Diluted adjusted EPS available to common stockholders | $0.90 | +58% | | Adjusted EBITDA | $331.0 million | +150% | Updated Full-Year 2024 Financial Outlook | Metric | Current Outlook | Prior Outlook | | :--- | :--- | :--- | | GTV growth | 1% to 4% | 1% to 4% | | Adjusted EBITDA | $1,200 to $1,260 million | $1,170 to $1,230 million | | Full year tax rate (GAAP and Adjusted) | 25% to 27% | 25% to 28% | | Capital expenditures | $275 to $325 million | $275 to $325 million | [Q1 2024 Financial & Operational Performance (As-Reported)](index=2&type=section&id=Q1%202024%20Financial%20%26%20Operational%20Performance%20(As-Reported)) As-reported results show massive YoY growth due to the IAA acquisition, with the automotive sector being the primary driver Q1 2024 vs Q1 2023 Key Metrics | Metric | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | GTV | $4,077.4 M | $1,899.2 M | 115% | | Service revenue | $849.1 M | $343.6 M | 147% | | Service revenue take rate | 20.8% | 18.1% | 270bps | | Inventory sales revenue | $215.6 M | $168.8 M | 28% | | Net income (loss) | $107.4 M | $(28.2) M | 481% | | Adjusted EBITDA | $331.0 M | $132.6 M | 150% | | Diluted EPS | $0.53 | $(0.28) | 289% | | Diluted adjusted EPS | $0.90 | $0.57 | 58% | GTV by Sector (in millions) | Sector | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | Automotive | $2,113.7 | $331.7 | 537% | | Commercial construction and transportation | $1,562.8 | $1,190.0 | 31% | | Other | $400.9 | $377.5 | 6% | | **Total GTV** | **$4,077.4** | **$1,899.2** | **115%** | Lots Sold by Sector (in '000s) | Sector | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | Automotive | 585.3 | 87.5 | 569% | | Commercial construction and transportation | 108.8 | 56.6 | 92% | | Other | 112.5 | 105.2 | 7% | | **Total lots** | **806.6** | **249.3** | **224%** | [Q1 2024 Supplemental Pro Forma Performance](index=3&type=section&id=Q1%202024%20Supplemental%20Pro%20Forma%20Performance) Pro forma results, including IAA in prior-year data, show 10% GTV growth led by the commercial and automotive sectors Supplemental Pro Forma Revenue Highlights (in millions) | Metric | Q1 2024 | Q1 2023 Pro Forma | % Change | | :--- | :--- | :--- | :--- | | GTV | $4,077.4 | $3,721.6 | 10% | | Service revenue | $849.1 | $745.0 | 14% | | Service revenue take rate | 20.8% | 20.0% | 80 bps | | Inventory sales revenue | $215.6 | $244.0 | (12)% | Supplemental Pro Forma GTV by Sector (in millions) | Sector | Q1 2024 | Q1 2023 Pro Forma | % Change | | :--- | :--- | :--- | :--- | | Automotive | $2,113.7 | $1,987.6 | 6% | | Commercial construction and transportation | $1,562.8 | $1,302.3 | 20% | | Other | $400.9 | $431.7 | (7)% | | **Total GTV** | **$4,077.4** | **$3,721.6** | **10%** | Supplemental Pro Forma Lots Sold by Sector (in '000s) | Sector | Q1 2024 | Q1 2023 Pro Forma | % Change | | :--- | :--- | :--- | :--- | | Automotive | 585.3 | 568.4 | 3% | | Commercial construction and transportation | 108.8 | 73.8 | 47% | | Other | 112.5 | 119.1 | (6)% | | **Total Lots** | **806.6** | **761.3** | **6%** | [Detailed Financial Review](index=6&type=section&id=Detailed%20Financial%20Review) Performance was driven by a 10% pro forma GTV increase and 14% service revenue growth, offset by a 12% drop in inventory sales revenue - **GTV increased 10% year-over-year** on a pro forma basis, with strength from the commercial construction and transportation sector and the automotive sector[19](index=19&type=chunk) - Pro forma service revenue **increased 14% YoY**, driven by higher GTV and an **80 basis point expansion in the service revenue take rate to 20.8%**[19](index=19&type=chunk) - Pro forma inventory sales revenue **decreased 12% YoY** due to lower automotive and commercial construction/transportation revenue[19](index=19&type=chunk) - Net income available to common stockholders **increased to $97.1 million**, primarily due to higher operating income[19](index=19&type=chunk) [Consolidated Financial Statements](index=10&type=section&id=Consolidated%20Financial%20Statements) The Q1 2024 statements show significant revenue growth, a return to profitability, and improved operating cash flow [Condensed Consolidated Income Statements](index=10&type=section&id=Condensed%20Consolidated%20Income%20Statements) Q1 2024 revenue grew 108% to $1.06 billion, with operating income turning positive to $198.9 million Q1 2024 Income Statement Highlights (in millions, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Total revenue | $1,064.7 | $512.4 | | Operating income (loss) | $198.9 | $(24.9) | | Income (loss) before income taxes | $139.9 | $(37.5) | | Net income (loss) | $107.4 | $(28.2) | | Net income (loss) available to common stockholders | $97.1 | $(34.2) | | Diluted earnings (loss) per share | $0.53 | $(0.28) | [Condensed Consolidated Balance Sheets](index=11&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet remains stable with total assets of $12.05 billion, including $4.53 billion in goodwill Balance Sheet Summary (in millions) | Metric | March 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total current assets | $1,884.8 | $1,814.0 | | Goodwill | $4,528.8 | $4,537.0 | | Intangible assets, net | $2,853.8 | $2,914.1 | | **Total assets** | **$12,045.2** | **$12,037.4** | | Total current liabilities | $1,464.2 | $1,342.7 | | Long-term debt | $2,921.8 | $3,061.6 | | **Total liabilities** | **$6,486.2** | **$6,528.0** | | **Total stockholders' equity** | **$5,068.6** | **$5,019.0** | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations improved significantly to $124.8 million, while financing activities used $190.9 million Q1 2024 Cash Flow Summary (in millions) | Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $124.8 | $(57.3) | | Net cash used in investing activities | $(77.5) | $(2,823.0) | | Net cash (used in) provided by financing activities | $(190.9) | $2,958.5 | | **(Decrease) Increase in Cash** | **$(150.5)** | **$81.1** | [Non-GAAP Financial Measures & Reconciliations](index=5&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section provides reconciliations for key non-GAAP measures, adjusting for acquisition costs and amortization - Beginning in Q1 2024, the company will **no longer report non-GAAP adjusted operating income and non-GAAP operating free cash flow**[32](index=32&type=chunk) [Reconciliation of Operating Expenses](index=5&type=section&id=Reconciliation%20of%20Operating%20Expenses) Total operating expenses of $868.2 million were adjusted to $771.8 million after excluding non-recurring items Reconciliation of Operating Expenses for Q1 2024 (in millions) | Expense Category | As Reported | Adjustments | Adjusted | | :--- | :--- | :--- | :--- | | Cost of services | $353.0 | $2.1 | $355.1 | | Cost of inventory sold | $196.6 | $0.0 | $196.6 | | SG&A | $198.1 | $(15.4) | $182.0 | | Acquisition related and integration costs | $12.8 | $(12.8) | $0.0 | | Depreciation and amortization | $107.7 | $(69.6) | $38.1 | | **Total operating expenses** | **$868.2** | **$(96.4)** | **$771.8** | [Adjusted Net Income and Diluted Adjusted EPS Reconciliation](index=13&type=section&id=Adjusted%20Net%20Income%20and%20Diluted%20Adjusted%20EPS%20Reconciliation) Adjusted net income increased 139% to $165.5 million, resulting in a Diluted Adjusted EPS of $0.90 Reconciliation to Adjusted Net Income (in millions) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income (loss) available to common stockholders (GAAP) | $97.1 | $(34.2) | | Amortization of acquired intangible assets | $69.6 | $16.6 | | Acquisition-related and integration costs | $12.8 | $126.2 | | Share-based payments expense | $13.3 | $6.7 | | Other adjustments, net | $(5.3) | $(49.1) | | **Adjusted net income available to common stockholders (Non-GAAP)** | **$165.5** | **$69.2** | Diluted Adjusted EPS | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Diluted EPS (GAAP) | $0.53 | $(0.28) | | **Diluted adjusted EPS (Non-GAAP)** | **$0.90** | **$0.57** | [Adjusted EBITDA Reconciliation](index=15&type=section&id=Adjusted%20EBITDA%20Reconciliation) Adjusted EBITDA increased 150% YoY to $331.0 million, reconciled from GAAP net income of $107.4 million Reconciliation to Adjusted EBITDA (in millions) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income (loss) (GAAP) | $107.4 | $(28.2) | | Depreciation and amortization | $107.7 | $36.2 | | Interest expense | $63.9 | $20.9 | | Income tax expense (benefit) | $32.5 | $(9.3) | | Interest income | $(6.6) | $(6.3) | | **EBITDA** | **$304.9** | **$13.3** | | Other adjustments | $26.1 | $119.3 | | **Adjusted EBITDA (Non-GAAP)** | **$331.0** | **$132.6** | [Adjusted Net Debt and Adjusted Net Debt/Adjusted EBITDA Reconciliation](index=16&type=section&id=Adjusted%20Net%20Debt%20and%20Adjusted%20Net%20Debt%2FAdjusted%20EBITDA%20Reconciliation) The adjusted net debt to TTM adjusted EBITDA ratio improved significantly from 5.4x to 2.0x YoY Adjusted Net Debt / Adjusted EBITDA (TTM) | Metric | March 31, 2024 | March 31, 2023 | | :--- | :--- | :--- | | Adjusted net debt | $2,488.2 M | $2,675.7 M | | Adjusted EBITDA (TTM) | $1,231.5 M | $492.8 M | | **Adjusted net debt/adjusted EBITDA** | **2.0x** | **5.4x** | [Shareholder Information](index=8&type=section&id=Shareholder%20Information) The company declared a quarterly cash dividend and announced participation in upcoming investor conferences - The company declared a **quarterly cash dividend of $0.27 per common share**, payable on June 20, 2024[21](index=21&type=chunk) - Upcoming investor events in Q2 2024 include the RBC Canadian Industrials Conference, Jefferies Automotive Conference, and William Blair Growth Conference[22](index=22&type=chunk)[24](index=24&type=chunk) [Appendix](index=8&type=section&id=Appendix) This section defines key operating metrics and includes the forward-looking statements disclaimer [Key Operating Metrics](index=9&type=section&id=Key%20Operating%20Metrics) Key metrics used to evaluate business performance include GTV, service revenue take rate, and inventory return - **Gross transaction value (GTV):** Total proceeds from all items sold at the Company's auctions and online marketplaces[26](index=26&type=chunk) - **Total service revenue take rate:** Total service revenue divided by total GTV[27](index=27&type=chunk) - **Inventory return:** Inventory sales revenue less cost of inventory sold[27](index=27&type=chunk) [Forward-looking Statements](index=8&type=section&id=Forward-looking%20Statements) This section outlines forward-looking statements and associated risks detailed in the company's SEC filings - Forward-looking statements involve risks related to the **IAA business combination**, integration efforts, and the ability to realize anticipated synergies[24](index=24&type=chunk) - Other risks are detailed in the company's periodic reports filed with the SEC, including the **Form 10-K for the fiscal year ended December 31, 2023**[25](index=25&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 RB Global, Inc. | (Exact Name of Registrant as Specified in its Charter) | | | | --- | --- | --- | | Canada | | 98-0626225 | | (State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) | | Two Westbrook Corporate Center, Suite 500, | | | | Westchester, Illinois, USA 60154 | | (7 ...

RB Global, Inc. (NYSE:RBA) Q4 2023 Earnings Conference Call February 23, 2024 8:30 AM ET Company Participants Sameer Rathod - VP IR & Market Intelligence James Kessler - CEO Eric Guerin - CFO Conference Call Participants Michael Doumet - Scotiabank Steve Hansen - Raymond James Craig Kennison - Baird Gary Prestopino - Barrington Research John Healy - Northcoast Research Larry De Maria - William Blair Maxim Sytchev - National Bank Financial Sabahat Khan - RBC Capital Markets Operator Good morning. My name is ...

Financial Performance - GTV increased 160% year-over-year to $4.0 billion, including $2.2 billion from the acquisition of IAA, Inc. [4] - Total revenue rose 134% year-over-year to $1.0 billion, with $559.2 million attributed to the IAA acquisition [4] - Service revenue surged 197% year-over-year to $809.1 million, including $488.0 million from IAA [4] - Adjusted EBITDA increased 153% year-over-year to $307.5 million [4] - Net income available to common stockholders grew 65% year-over-year to $74.8 million [4] - Diluted adjusted earnings per share rose 21% year-over-year to $0.82 per share [4] - Operating income for Q4 2023 was $170.8 million, a 160% increase from $65.7 million in Q4 2022; annual operating income was $471.3 million, a slight increase of 4% from $453.5 million [28] - Net income for Q4 2023 was $84.2 million, an 85% increase from $45.4 million in Q4 2022; for the year, net income was $206.0 million, down 36% from $319.8 million [28] - Adjusted net income available to common stockholders for the year ended December 31, 2023, was $502.2 million, an 86% increase from $269.9 million in 2022 [40] - Adjusted EBITDA for Q4 2023 was $307.5 million, a 153% increase from $121.5 million in Q4 2022 [42] Growth Projections - The company projects full-year 2024 GTV growth between 1% and 4% [4] - The company anticipates continued growth opportunities following the acquisition of IAA, with a focus on integrating operations and realizing synergies [23] Revenue Breakdown - Automotive sector GTV for Q4 2023 reached $2.1 billion, a 4,177% increase year-over-year [7] - Total lots sold increased by 6% year-over-year to 786.8 thousand in Q4 2023, with automotive lots sold rising by 7% to 573.2 thousand [12] - Gross transaction value (GTV) surged 160% year-over-year to $4.0 billion, primarily due to the inclusion of $2.2 billion GTV from IAA [18] - Service revenue rose 197% year-over-year to $809.1 million, with $488.0 million attributed to IAA, and a pro forma increase of 14% [18] - Inventory sales revenue grew by 35% year-over-year, largely due to $71.2 million from IAA, but decreased by 10% on a pro forma basis [18] Expenses and Cash Flow - Operating expenses for Q4 2023 totaled $870.6 million, with adjusted operating expenses at $770.4 million [15] - Operating Free Cash Flow (OFCF) for 2023 was $230.4 million, a decrease of 59% compared to $556.6 million in 2022 [49] - Cash provided by operating activities increased to $544.0 million in 2023, up 17% from $463.1 million in 2022 [49] - Net capital spending in 2023 was $(313.6) million, a significant increase from $93.5 million in 2022, reflecting a 435% change [49] Assets and Liabilities - Cash and cash equivalents at the end of 2023 were $576.2 million, up from $494.3 million at the end of 2022 [29] - Total assets increased to $12,037.4 million in 2023 from $2,863.7 million in 2022, driven by significant acquisitions and growth in intangible assets [29] - Total debt increased to $3,089.5 million in 2023, a 406% increase from $610.6 million in 2022 [46] - Adjusted net debt rose to $2,513.3 million, a 2061% increase from $116.3 million in 2022 [46] Shareholder Returns - The company declared a quarterly cash dividend of $0.27 per common share, payable on March 1, 2024 [20] - The company reported a basic earnings per share of $0.41 for Q4 2023, unchanged from Q4 2022, while diluted earnings per share increased by 2% to $0.41 [28] Acquisition Impact - The company completed the acquisition of IAA, impacting cash flows and resulting in a net cash used in investing activities of $(3,108.3) million for 2023 [30] - Acquisition-related and integration costs for the year increased significantly to $216.1 million, a 479% rise from $37.3 million in 2022 [42] - Amortization of acquired intangible assets in 2023 was $76.0 million, including $67.6 million from IAA [55] - Acquisition-related and integration costs for 2023 totaled $46.3 million, primarily related to the acquisition of IAA [55]

RB Global, Inc. (NYSE:RBA) Q3 2023 Earnings Conference Call November 9, 2023 4:30 PM ET Company Participants Sameer Rathod - VP IR & Market Intelligence James Kessler - CEO Conference Call Participants Michael Doumet - Scotiabank Craig Kennison - Baird Steven Hansen - Raymond James Sabahat Khan - RBC Capital Markets Maxim Sytchev - National Bank Financial Michael Feniger - Bank of America Lawrence De Maria - William Blair Operator Good day. My name is Chris, and I'll be your conference operator today. At th ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number: 001-13425 RB Global, Inc. | (Exact Name of Registrant as Specified in its Charter) | | | --- | --- | | Can ...

Financial Data and Key Metrics Changes - GTV increased by 9%, driven by strength in commercial construction and transportation, as well as a rebound in the automotive sector [23][44] - Adjusted EBITDA increased by 13% compared to the combined adjusted EBITDA of IAA and Ritchie Bros. for the prior year period [27] - Cash used in operating activities decreased in the first half of 2023 compared to the same period last year due to higher networking capital balances and increased cash taxes [29][49] Business Line Data and Key Metrics Changes - Automotive GTV increased by 5%, driven by rebounding unit volumes on a flat average price per lot [24] - Service revenue increased by 15%, with the service revenue take rate expanding by 100 basis points to 19.5% [45] - Inventory revenue declined by 1%, with the inventory rate contracting by 710 basis points year-over-year to approximately 3% [26] Market Data and Key Metrics Changes - The total loss ratio in the automotive sector improved to approximately 18.4% from 17.1% in the same period last year [17] - GTV for construction and transportation increased by 15%, driven by an increase in unit volumes [44] Company Strategy and Development Direction - The company is focused on integrating IAA and realizing targeted cost savings while enhancing customer experience [7][18] - A modern checkout microservice was successfully implemented, receiving positive customer feedback [16] - The company aims to deliver at least $100 million to $120 million of annual run rate synergies by the end of 2025 [42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the integration of IAA and its long-term business prospects, highlighting strong execution and market adaptability [15][18] - The company anticipates GTV growth in the third quarter to be low to mid single digits year-over-year on a combined basis due to seasonality and timing of auctions [24] - Management emphasized the importance of consistent execution and collaboration with insurance partners to enhance competitiveness [68][115] Other Important Information - The company realized $7 million in actual cost synergies for the quarter and has auctioned a total of $36 million in annual run rate cost synergies since the close of the transaction [21][88] - Adjusted net debt was approximately $2.7 billion, with a focus on de-leveraging to approximately 2 times by the end of the first quarter of 2025 [49] Q&A Session All Questions and Answers Question: What is the commitment to synergy opportunities following the leadership change? - Management expressed strong commitment to delivering on synergy opportunities and emphasized the importance of consistent execution across all branches [52][53] Question: Can you provide insights on the termination of the royalty and non-compete agreement? - The termination allows the company to leverage its capabilities more effectively and scale its business more efficiently [41][55] Question: How is the integration process structured and managed? - The integration team is led by a steering committee that includes senior leaders from both IAA and Ritchie Bros., ensuring focused execution on integration plans [63][87] Question: What are the expectations for RBA and IAA EBITDA by the end of the year? - IAA is performing better than expected, while specific RBA EBITDA figures were not disclosed [95][96] Question: How does the company plan to enhance competitiveness in the insurance market? - The focus is on improving operational execution, ensuring consistency, and leveraging technology to enhance service delivery [68][115] Question: What is the outlook for service revenue take rates? - The company expects some headwinds in commission take rates due to sourcing more GTV from strategic accounts, but anticipates long-term growth in take rates [131]

On a combined basis, we are about 35% Commissions to 65% Buyer Fees • Includes certain legal, finance, advisory and other costs related to acquisitions • It also includes integration costs, such as severance Note: Sectors include salvage and non-salvage transactions © 2023 RB Global, Inc. | All Rights Reserved 11 | --- | |------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | | Inventory revenue is impac ...