Asbury Automotive Group(US:ABG)2024-02-28 16:00Financial Performance - Total revenue for 2023 was $14,802.7 million, a decrease of 4.1% from $15,433.8 million in 2022[358]. - New vehicle revenue increased to $7,630.7 million, up from $7,365.6 million in 2022, representing a growth of 3.6%[358]. - Used vehicle revenue decreased to $4,414.3 million, down 15.1% from $5,197.1 million in 2022[358]. - Gross profit for 2023 was $2,755.8 million, a decline of 11.1% compared to $3,100.6 million in 2022[358]. - Net income for 2023 was $602.5 million, a decrease of 39.7% from $997.3 million in 2022[358]. - Earnings per diluted share for 2023 was $28.74, down from $44.61 in 2022, reflecting a decline of 35.7%[358]. - The company reported a comprehensive income of $589.1 million for 2023, down from $1,072.2 million in 2022[361]. Assets and Liabilities - Total current assets increased to $3,057.1 million, up from $1,909.8 million in 2022, marking a growth of 60.0%[354]. - Total liabilities increased to $6,915.3 million, compared to $5,117.2 million in 2022, an increase of 35.1%[354]. - Shareholders' equity rose to $3,244.1 million, up from $2,903.5 million in 2022, representing a growth of 11.7%[354]. - Total accounts receivable was $228.6 million, up from $174.1 million in 2022, reflecting an increase of approximately 31.3%[449]. - Total inventories as of December 31, 2023, amounted to $1,768.3 million, a significant rise from $959.2 million in 2022, representing an increase of approximately 84.5%[450]. - As of December 31, 2023, total assets held for sale were valued at $342.2 million, compared to $29.1 million in 2022, indicating a substantial increase[453]. Debt and Financing - As of December 31, 2023, the company had total debt of $3.23 billion, excluding floor plan notes payable and certain debt issuance costs[420]. - The company has substantial debt service obligations, which include required cash payments of principal and interest for the foreseeable future[420]. - The company entered into a 2023 Senior Credit Facility providing a $500.0 million revolving credit facility and a $1.93 billion new vehicle revolving floorplan facility[480]. - The 2023 Senior Credit Facility matures on October 20, 2028, with all amounts outstanding due at that time[485]. - Total outstanding long-term debt as of December 31, 2023, is $3,121.2 million, a decrease from $3,216.8 million in 2022, reflecting a reduction of approximately 2.95%[14]. - The aggregate maturities of long-term debt for 2024 amount to $85.7 million, with total maturities reaching $3,230.1 million as of December 31, 2023[495]. Acquisitions and Impairments - The company completed the acquisition of the Jim Koons Dealerships for approximately $1.50 billion, funded by borrowings and cash on hand[373]. - The company recorded impairment charges of $73.1 million related to manufacturer franchise rights during the year ended December 31, 2023, with an aggregate carrying value of approximately $2,095.8 million[339]. - Goodwill associated with acquisitions is tested for impairment annually, with the fair value of manufacturer franchise rights determined by discounting projected cash flows[392][394]. - Goodwill recognized from the Koons acquisition was $231.7 million, primarily due to anticipated synergies and the acquired workforce[436]. - The company recorded a $1.1 million impairment charge related to construction in progress during the year ended December 31, 2023[390]. Cash Flow and Investments - Net cash provided by operating activities decreased to $313.0 million in 2023 from $696.0 million in 2022 and $1,163.7 million in 2021[366]. - Net cash used in investing activities was $(1,678.4) million in 2023, a significant decrease from $464.7 million in 2022[366]. - The company had total investments of $332.9 million as of December 31, 2023[419]. - The company recorded gross gains of $3.7 million and gross losses of $0.9 million from equity securities for the year ended December 31, 2023[460]. Operational Highlights - The company operates 208 new vehicle franchises and 37 collision centers across 16 states[372]. - Seasonal variations affect operating results, with higher demand for new vehicles typically in the second, third, and fourth quarters[374]. - The company maintains a reserve for used vehicle inventory where cost basis exceeds net realizable value, considering factors such as aging, historical sales experience, and current market conditions[385]. Shareholder Activities - The company issued 128,563 shares of common stock in connection with share-based payment arrangements during the year ended December 31, 2023[364]. - The company repurchased 1,316,167 shares of common stock during the year ended December 31, 2023, under its share repurchase program[412]. - Share-based compensation for the year ended December 31, 2023, amounted to $23.5 million, compared to $20.6 million in 2021, reflecting an increase of approximately 14.0%[364]. Regulatory and Compliance - The company’s internal control over financial reporting was deemed effective as of December 31, 2023, based on the COSO criteria[345]. - The company is subject to operating and financial restrictions in its leases and debt instruments, which may impact its ability to incur additional indebtedness[421]. - The company is evaluating the impact of recent accounting pronouncements on its consolidated financial statements, including ASU 2023-09 and ASU 2023-07[424][425].