Avis Budget Group Inc (CAR) Q3 2024 Earnings Call Highlights: Strong Revenue and Strategic ...

GuruFocus News
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In This Article:

  • Revenue: Nearly $3.5 billion for the third quarter.

  • Adjusted EBITDA: $503 million for the third quarter.

  • Americas Revenue: More than $2.6 billion in the third quarter.

  • Americas Adjusted EBITDA: $384 million in the third quarter.

  • International Revenue: $840 million in the third quarter.

  • International Adjusted EBITDA: $139 million in the third quarter.

  • Rental Days in Americas: Down 2% compared to the third quarter of 2023.

  • Price Change: Down 2% overall for the quarter.

  • Vehicle Utilization in Americas: Nearly 72%, more than 1 point higher than the third quarter of 2023.

  • Vehicle Utilization International: 73.7%, up over 3 points compared to the third quarter of 2023.

  • Net Corporate Leverage Ratio: 4.7 times after term loan repayment.

  • Available Liquidity: Over $1.2 billion as of September 30.

  • Share Repurchases: Approximately 526,000 shares for nearly $43 million through October 30.

Release Date: November 01, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Avis Budget Group Inc (NASDAQ:CAR) reported strong third-quarter revenue of nearly $3.5 billion and adjusted EBITDA of $503 million.

  • The company successfully improved vehicle utilization, with the Americas segment achieving a utilization rate of nearly 72%, more than 1 point higher than the third quarter of 2023.

  • The model year 2025 fleet buy is progressing well, with expected holding costs below recent years, positioning the company for a more profitable future.

  • International operations saw a 5% increase in rental days and a 14% growth in higher-margin inbound and intra-European cross-border volumes.

  • The company launched a new customer app in October, enhancing user experience and aiming to increase app downloads, boost conversion rates, and drive revenue growth through direct channel reservations.

Negative Points

  • Price was down 2% for the quarter overall, with the Americas nearly flat, indicating pricing pressures in the market.

  • The company faced a $40 million loss from pulling forward vehicle sales in the quarter, compared to $145 million of gains last year, resulting in a significant year-over-year variance.

  • Straight-line depreciation increased, resulting in more than $100 million in incremental fleet expense year-over-year.

  • Vehicle interest was a $33 million headwind in the quarter, with expectations for similar impacts in the fourth quarter.

  • Rental days were slightly less than anticipated, leading to a nearly $85 million reduction in year-over-year revenue.

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