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Avis Budget Group Reports First Quarter 2019 Results

PARSIPPANY, N.J., May 1, 2019 – Avis Budget Group, Inc. (NASDAQ: CAR) today reported results for its first quarter ended March 31, 2019.

First Quarter Highlights:

  • Revenues were $1.9 billion, down 2% due to the impact of currency exchange rate movements
  • Net loss was $91 million or a diluted loss of $1.20 per share
  • Adjusted EBITDA loss was $1 million
  • Adjusted diluted loss of $0.78 per share
  • We reaffirm our projected full-year 2019 guidance

“We had a strong first quarter to begin 2019, despite the impacts from a government shutdown, uncertainty around Brexit and the shift of Easter to the second quarter,” said Larry De Shon, Avis Budget Group President and Chief Executive Officer. “Including these impacts, our results were comparable to prior year, leaving us on track for our full-year guidance. Americas leisure pricing increased for the seventh consecutive quarter. At the same time we continue to improve our per-unit fleet costs, which were 5% lower globally.”

“Looking forward, we will continue to execute on our strategic initiatives to accelerate our position as a global leader in mobility solutions, as evidenced by partnerships with Lyft, Via, and Waymo, while we enhance the customer experience and improve profitability.”

  • Revenues were 2% lower in the quarter, with a 2% decrease in Revenue per Day and a $56 million or 3% effect from currency exchange movements being partially offset by a 2% increase in Rental Days
  • Overall Per-Unit Fleet Costs improved 5% year-over-year
  • For the quarter, net loss was $91 million. Adjusted EBITDA loss was $1 million and Adjusted net loss was $59 million, or $0.78 per diluted share

Finance and Liquidity

In February 2019, our Avis Budget Rental Car Funding subsidiary issued $600 million of asset-backed notes with an expected final payment date of March 2022 incurring interest at a weighted average rate of 3.56%.

In April 2019, our Avis Budget Rental Car Funding subsidiary also issued $650 million of asset-backed notes with an expected final payment date of September 2024 incurring interest at a weighted average rate of 3.44%.

Our corporate debt was approximately $3,524 million at the end of the first quarter and cash and cash equivalents totaled $540 million.

Capital Allocation

Weighted average diluted shares outstanding (as used to calculate Adjusted diluted earnings per share) were 75.8 million in the quarter compared to 81.0 million in the prior year, a 6% year-over-year reduction.


The Company’s full-year 2019 outlook includes non-GAAP financial measures and excludes the effect of future changes in currency exchange rates.  The Company believes that it is impracticable to provide a reconciliation to the most comparable GAAP measures due to the forward-looking nature of these forecasted Adjusted earnings measures and the degree of uncertainty associated with forecasting the reconciling items and amounts.  The Company further believes that providing estimates of the amounts that would be required to reconcile the forecasted adjusted measures to forecasted GAAP measures would imply a degree of precision that would be confusing or misleading to investors. The after-tax effect of such reconciling items could be significant to the Company’s future quarterly or annual results.

The Company today provides its 2019 guidance:

$ millions *2019 Estimates
Revenues$9,200 – $9,500
Adjusted EBITDA$750 – $850
Non-vehicle related depreciation and amortization$215
Interest expense related to corporate debt, net$185
Adjusted pretax income$350 – $450
Adjusted net income$260 – $320
Adjusted diluted earnings per share$3.35 – $4.20
Capital expenditures$235
Cash taxes, vehicle programs and other$80 – $130
Adjusted free cash flow$250 – $300

* Excluding Adjusted diluted earnings per share.

Non-vehicle related depreciation and amortization excludes acquisition-related amortization expense.

Interest expense related to corporate debt, net excludes early extinguishment of debt.

$ change millions (better)/worsevs prior year
Vehicle interest expense$25 – $35
Adjusted EBITDA net currency translation$15 – $25

Additional guidance details:


% changevs prior year
Rental days0.0% – 2.0%
Revenue per Day0.5% – 2.5%
Per-Unit Fleet Costs per Month1.0% – 3.0%

Revenue per Day and Per-Unit Fleet Costs per Month exclude exchange rate effects.


% changevs prior year
Rental days3.0% – 6.0%
Revenue per Day(1.0%) – (4.0%)
Per-Unit Fleet Costs per Month0.0% – 2.0%

Revenue per Day and Per-Unit Fleet Costs per Month exclude exchange rate effects.

Investor Conference Call
Avis Budget Group will host a conference call to discuss first quarter results and its outlook on May 2, 2019, at 8:30 a.m. (ET).  Investors may access the call at or by dialing (773) 756-0108 and providing the participant passcode 9806274.  The supporting presentation will also be available at Investors are encouraged to dial in approximately 10 minutes prior to the call.  A replay will be available at following the call. A telephone replay will also be available from 11:00 a.m. (ET) on May 2, 2019 until 10:00 p.m. (ET) on June 2, 2019 at (203) 369-3335.

About Avis Budget Group
Avis Budget Group is a leading global provider of mobility solutions through our three most recognized brands, Avis, Budget and Zipcar, together with several other brands well recognized in their respective markets. We and our licensees operate in approximately 180 countries with more than 11,000 car and truck rental locations throughout the world. We generally maintain a leading share of airport car rental revenue in North America, Europe and Australasia, and we operate one of the leading truck rental businesses in the United States. Our Zipcar brand is one of the world’s leading car sharing businesses offering an alternative to traditional vehicle rental and ownership. Avis Budget Group has approximately 30,000 employees and is headquartered in Parsippany, N.J. More information is available at

Forward-Looking Statements
Certain statements in this press release constitute “forward-looking statements.” Any statements that refer to outlook, expectations or other characterizations of future events, circumstances or results, including all statements related to our future results, future fleet costs, acquisition synergies, cost-saving initiatives, cash flows and future share repurchases are forward-looking statements. Various risks that could cause future results to differ from those expressed by the forward-looking statements included in this press release include, but are not limited to, the high level of competition in the mobility industry, changes in our fleet costs as a result of a change in the cost of new vehicles, manufacturer recalls and/or the value of used vehicles, disruption in the supply of new vehicles, disposition of vehicles not covered by manufacturer repurchase programs, the financial condition of the manufacturers that supply our rental vehicles which could effect their ability to perform their obligations under our repurchase and/or guaranteed depreciation arrangements, any change in economic conditions generally, particularly during our peak season and/or in key market segments, any change in travel demand, including changes in airline passenger traffic, any occurrence or threat of terrorism, any changes to the cost or supply of fuel, risks related to acquisitions or integration of acquired businesses, risks associated with litigation, governmental or regulatory inquiries or investigations, risks related to the security of our information technology systems, disruptions in our communication networks, changes in tax or other regulations, a significant increase in interest rates or borrowing costs, our ability to obtain financing for our global operations, including the funding of our vehicle fleet via asset-backed securities markets, any fluctuations related to the mark-to-market of derivatives which hedge our exposure to exchange rates, interest rates and fuel costs, our ability to meet the covenants contained in the agreements governing our indebtedness, and our ability to accurately estimate our future results and implement our strategy for growth and cost savings. Other unknown or unpredictable factors could also have material adverse effects on the Company’s performance or achievements. Important assumptions and other important factors that could cause actual results to differ materially from those in the forward-looking statements are specified in Avis Budget Group’s Annual Report on Form 10-K for the year ended December 31, 2018 and in other filings and furnishings made by the Company with the Securities and Exchange Commission (the “SEC”) from time to time. The Company undertakes no obligation to publicly update any forward-looking statements to reflect subsequent events of circumstances.

Non-GAAP Financial Measures and Key Metrics
This release includes financial measures such as Adjusted EBITDA and Adjusted free cash flow, as well as other financial measures that exclude certain items that are not considered generally accepted accounting principles (“GAAP”) measures as defined under SEC rules. Important information regarding such measures is contained on Table 1, Table 4, Table 5 and Appendix I of this release. The Company and its management believe that these non-GAAP measures are useful to investors in measuring the comparable results of the Company period-over-period. The GAAP measures most directly comparable to Adjusted EBITDA, Adjusted free cash flow, Adjusted pretax income (loss), Adjusted net income (loss) and Adjusted diluted earnings (loss) per share are net income (loss), net cash provided by operating activities, income(loss) before income taxes, net income (loss) and diluted earnings (loss) per share, respectively. Foreign currency translation effects on the Company’s results are quantified by translating the current period’s non-U.S. dollar-denominated results using the currency exchange rates of the prior period of comparison including any related gains and losses on currency hedges. Per-unit fleet costs, which represent vehicle depreciation, lease charges and gain or loss on vehicle sales, divided by average rental fleet, is calculated on a per-month basis.

Share Repurchase Program
The Company’s share repurchases may occur through open market purchases or trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements and other factors. The repurchase program may be suspended, modified or discontinued at any time without prior notice. The repurchase program has no set expiration or termination date.

Media Contact:Investor Contact:
Katie McCallMatthew Flaherty
(973) 496-3916(973) 496-3906

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Tables Follow

Appendix I

Avis Budget Group, Inc.

Adjusted EBITDA
The accompanying press release presents Adjusted EBITDA, which represents income (loss) from continuing operations before non-vehicle related depreciation and amortization, any impairment charges, restructuring and other related charges, early extinguishment of debt costs, non-vehicle related interest, transaction-related costs, net charges for unprecedented personal-injury legal matters, non-operational charges related to shareholder activist activity and income taxes. Net charges for unprecedented personal-injury legal matters are recorded within operating expenses in our consolidated statement of operations. Non-operational charges related to shareholder activist activity include third party advisory, legal and other professional service fees and are recorded within selling, general and administrative expenses in our consolidated results of operations. Adjusted EBITDA includes stock-based compensation expense and deferred financing fee amortization totaling $11 million and $12 million in first quarter 2019 and 2018, respectively.

We and our management believe that Adjusted EBITDA is useful to investors as a supplemental measure in evaluating the aggregate performance of our operating businesses and in comparing our results from period to period. Adjusted EBITDA is the measure that is used by our management, including our chief operating decision maker, to perform such evaluation. Adjusted EBITDA is also a component in the determination of management’s compensation. Adjusted EBITDA should not be considered in isolation or as a substitute for net income or other income statement data prepared in accordance with GAAP and our presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies. A reconciliation of Adjusted EBITDA from net income (loss) recognized under GAAP is provided on Table 5.

Adjusted Earnings Non-GAAP Measures
The accompanying press release and tables present Adjusted pretax income (loss), Adjusted net income (loss) and Adjusted diluted earnings (loss) per share, which exclude certain items. We and our management believe that these measures referred to above are useful to investors as supplemental measures in evaluating the aggregate performance of the Company. We exclude restructuring and other related charges, transaction-related costs, costs related to early extinguishment of debt and other certain items as such items are not representative of the results of operations of our business less a provision for income taxes derived utilizing applicable statutory tax rates for each item. A reconciliation of our Adjusted earnings Non-GAAP measures from the appropriate measures recognized under GAAP is provided on Table 5.

Adjusted Free Cash Flow
Represents Net Cash Provided by Operating Activities adjusted to reflect the cash inflows and outflows relating to capital expenditures, the investing and financing activities of our vehicle programs, asset sales, if any, and to exclude debt extinguishment costs, transaction-related costs, restructuring and other related charges and non-operational charges related to shareholder activist activity. We have revised our definition of Adjusted Free Cash Flow to exclude restructuring and other related charges and have revised prior years’ Adjusted Free Cash Flow amounts accordingly. We believe this change is meaningful to investors as it brings the measurement in line with our other non-GAAP measures. We believe that Adjusted Free Cash Flow is useful to management and investors in measuring the cash generated that is available to be used to repay debt obligations, repurchase stock, pay dividends and invest in future growth through new business development activities or acquisitions. Adjusted Free Cash Flow should not be construed as a substitute in measuring operating results or liquidity, and our presentation of Adjusted Free Cash Flow may not be comparable to similarly-titled measures used by other companies.  A reconciliation of Adjusted Free Cash Flow to the appropriate measure recognized under GAAP is provided on Table 4.

Available Rental Day
Defined as Average Rental Fleet times the numbers of days in a given period.

Average Rental Fleet
Represents the average number of vehicles in our fleet during a given period of time.

Currency Exchange Rate Effects
Represents the difference between current-period results as reported and current-period results translated at the prior-period average exchange rates plus any related currency hedges.

Net Corporate Leverage
Represents corporate debt, minus cash and cash equivalents, divided by Adjusted EBITDA for the twelve months prior to the date of calculation.

Per-Unit Fleet Costs
Represents vehicle depreciation, lease charges and gain or loss on vehicles sales, divided by Average Rental Fleet.

Rental Days
Represents the total number of days (or portion thereof) a vehicle was rented during a 24-hour period.

Revenue per Day
Represents revenues divided by Rental Days.

Vehicle Utilization
Represents Rental Days divided by Available Rental Days.