Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 22, 2013 | |
Document and Entity Information | ||
Entity Registrant Name | PENSKE AUTOMOTIVE GROUP, INC. | |
Entity Central Index Key | 1019849 | |
Document Type | 10-Q | |
Document Period End Date | 30-Sep-13 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 90,199,990 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED_CONDENSED_BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
ASSETS | ||
Cash and cash equivalents | $71,101 | $43,447 |
Accounts receivable, net of allowance for doubtful accounts of $3,330 and $2,979 | 588,311 | 554,851 |
Inventories | 2,293,390 | 2,000,206 |
Other current assets | 83,508 | 90,485 |
Assets held for sale | 1,065 | 71,107 |
Total current assets | 3,037,375 | 2,760,096 |
Property and equipment, net | 1,211,020 | 1,031,188 |
Goodwill | 1,118,369 | 980,438 |
Franchise value | 283,128 | 283,152 |
Equity method investments | 333,081 | 303,160 |
Other long-term assets | 27,831 | 20,956 |
Total assets | 6,010,804 | 5,378,990 |
LIABILITIES AND EQUITY | ||
Floor plan notes payable | 1,537,185 | 1,408,362 |
Floor plan notes payable - non-trade | 802,051 | 725,526 |
Accounts payable | 380,000 | 263,881 |
Accrued expenses | 275,483 | 223,972 |
Current portion of long-term debt | 46,894 | 19,493 |
Liabilities held for sale | 2,592 | 51,279 |
Total current liabilities | 3,044,205 | 2,692,513 |
Long-term debt | 1,014,070 | 918,024 |
Deferred tax liabilities | 338,430 | 287,818 |
Other long-term liabilities | 156,708 | 164,314 |
Total liabilities | 4,553,413 | 4,062,669 |
Commitments and contingent liabilities | ||
Penske Automotive Group stockholders' equity: | ||
Preferred Stock, $0.0001 par value; 100 shares authorized; none issued and outstanding | ||
Common Stock | 9 | 9 |
Additional paid-in capital | 691,886 | 700,013 |
Retained earnings | 755,344 | 611,026 |
Accumulated other comprehensive income (loss) | -3,054 | -6,833 |
Total Penske Automotive Group stockholders' equity | 1,444,185 | 1,304,215 |
Non-controlling interest | 13,206 | 12,106 |
Total equity | 1,457,391 | 1,316,321 |
Total liabilities and equity | 6,010,804 | 5,378,990 |
Non-voting Common Stock | ||
Penske Automotive Group stockholders' equity: | ||
Common Stock | ||
Class C Common Stock | ||
Penske Automotive Group stockholders' equity: | ||
Common Stock |
CONSOLIDATED_CONDENSED_BALANCE1
CONSOLIDATED CONDENSED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $3,330 | $2,979 |
Preferred Stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, shares authorized | 100 | 100 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, shares authorized | 240,000 | 240,000 |
Common Stock, shares issued | 90,200 | 90,295 |
Common Stock, shares outstanding | 90,200 | 90,295 |
Non-voting Common Stock | ||
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, shares authorized | 7,125 | 7,125 |
Common Stock, shares issued | 0 | 0 |
Common Stock, shares outstanding | 0 | 0 |
Class C Common Stock | ||
Common Stock, par value (in dollars per share) | $0.00 | $0.00 |
Common Stock, shares authorized | 20,000 | 20,000 |
Common Stock, shares issued | 0 | 0 |
Common Stock, shares outstanding | 0 | 0 |
CONSOLIDATED_CONDENSED_STATEME
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenue: | ||||
Total revenues | $3,824,143 | $3,336,020 | $10,927,917 | $9,814,784 |
Cost of sales: | ||||
Total cost of sales | 3,244,235 | 2,834,536 | 9,244,779 | 8,313,365 |
Gross profit | 579,908 | 501,484 | 1,683,138 | 1,501,419 |
Selling, general and administrative expenses | 454,188 | 400,039 | 1,308,958 | 1,188,658 |
Depreciation | 15,784 | 13,704 | 45,300 | 40,014 |
Operating income | 109,936 | 87,741 | 328,880 | 272,747 |
Floor plan interest expense | -10,840 | -9,951 | -32,008 | -29,319 |
Other interest expense | -12,370 | -11,583 | -36,163 | -35,155 |
Equity in earnings of affiliates | 11,240 | 8,814 | 22,489 | 21,392 |
Debt redemption costs | -17,753 | -17,753 | ||
Income from continuing operations before income taxes | 97,966 | 57,268 | 283,198 | 211,912 |
Income taxes | -31,692 | -15,421 | -95,263 | -69,347 |
Income from continuing operations | 66,274 | 41,847 | 187,935 | 142,565 |
Income (Loss) from discontinued operations, net of tax | -742 | -534 | -1,889 | -4,634 |
Net income | 65,532 | 41,313 | 186,046 | 137,931 |
Less: Income attributable to non-controlling interests | 257 | 282 | 1,065 | 990 |
Net income attributable to Penske Automotive Group common stockholders | 65,275 | 41,031 | 184,981 | 136,941 |
Basic earnings per share attributable to Penske Automotive Group common stockholders: | ||||
Continuing operations (in dollars per share) | $0.73 | $0.46 | $2.07 | $1.57 |
Discontinued operations (in dollars per share) | ($0.01) | ($0.01) | ($0.02) | ($0.05) |
Net income attributable to Penske Automotive Group common stockholders (in dollars per share) | $0.72 | $0.45 | $2.05 | $1.52 |
Shares used in determining basic earnings per share (in shares) | 90,201,075 | 90,263,865 | 90,297,797 | 90,330,378 |
Diluted earnings per share attributable to Penske Automotive Group common stockholders: | ||||
Continuing operations (in dollars per share) | $0.73 | $0.46 | $2.07 | $1.57 |
Discontinued operations (in dollars per share) | ($0.01) | ($0.01) | ($0.02) | ($0.05) |
Net income attributable to Penske Automotive Group common stockholders (in dollars per share) | $0.72 | $0.45 | $2.05 | $1.52 |
Shares used in determining diluted earnings per share (in shares) | 90,237,075 | 90,295,865 | 90,333,797 | 90,362,378 |
Amounts attributable to Penske Automotive Group common stockholders: | ||||
Income from continuing operations | 66,274 | 41,847 | 187,935 | 142,565 |
Less: Income attributable to non-controlling interests | 257 | 282 | 1,065 | 990 |
Income from continuing operations, net of tax | 66,017 | 41,565 | 186,870 | 141,575 |
Income (Loss) from discontinued operations, net of tax | -742 | -534 | -1,889 | -4,634 |
Net income attributable to Penske Automotive Group common stockholders | 65,275 | 41,031 | 184,981 | 136,941 |
New vehicle | ||||
Revenue: | ||||
Total revenues | 1,995,836 | 1,736,131 | 5,674,658 | 4,997,923 |
Cost of sales: | ||||
Total cost of sales | 1,846,504 | 1,601,762 | 5,245,533 | 4,596,274 |
Used vehicle | ||||
Revenue: | ||||
Total revenues | 1,098,484 | 969,130 | 3,182,822 | 2,841,403 |
Cost of sales: | ||||
Total cost of sales | 1,017,109 | 898,264 | 2,941,273 | 2,622,055 |
Finance and insurance, net | ||||
Revenue: | ||||
Total revenues | 99,758 | 83,650 | 282,353 | 242,892 |
Service and parts | ||||
Revenue: | ||||
Total revenues | 381,485 | 365,351 | 1,158,404 | 1,088,665 |
Cost of sales: | ||||
Total cost of sales | 152,033 | 154,203 | 469,229 | 457,205 |
Fleet and wholesale | ||||
Revenue: | ||||
Total revenues | 182,629 | 181,758 | 541,924 | 643,901 |
Cost of sales: | ||||
Total cost of sales | 180,162 | 180,307 | 532,391 | 637,831 |
Commercial vehicle and car rental | ||||
Revenue: | ||||
Total revenues | 65,951 | 87,756 | ||
Cost of sales: | ||||
Total cost of sales | $48,427 | $56,353 |
CONSOLIDATED_CONDENSED_STATEME1
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net Income | $65,532 | $41,313 | $186,046 | $137,931 |
Other Comprehensive Income: | ||||
Foreign currency translation adjustment | 41,811 | 16,707 | 6,714 | 15,224 |
Unrealized gain (loss) on interest rate swaps: | ||||
Unrealized gain (loss) arising during the period, net of tax benefit (provision) of $(178), $590, $(513), and $2,114, respectively | 272 | -903 | 784 | -3,232 |
Reclassification adjustment for loss included in floor plan interest expense, net of tax provision of $361, $705, $1,447, and $2,066, respectively | 552 | 1,078 | 2,213 | 3,158 |
Unrealized gain (loss) on interest rate swaps, net of tax | 824 | 175 | 2,997 | -74 |
Unrealized gain (loss) on forward exchange contracts | -4,013 | -4,013 | ||
Other adjustments to Comprehensive Income, net | -173 | 1,066 | -1,385 | 2,608 |
Other Comprehensive Income (Loss), Net of Taxes | 38,449 | 17,948 | 4,313 | 17,758 |
Comprehensive Income | 103,981 | 59,261 | 190,359 | 155,689 |
Less: Comprehensive income attributable to non-controlling interests | 257 | 489 | 1,599 | 1,197 |
Comprehensive income attributable to Penske Automotive Group common stockholders | $103,724 | $58,772 | $188,760 | $154,492 |
CONSOLIDATED_CONDENSED_STATEME2
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Unrealized gain (loss) arising during the period, tax benefit (provision) | ($178) | $590 | ($513) | $2,114 |
Reclassification adjustment for loss included in floor plan interest expense, tax provision | $361 | $705 | $1,447 | $2,066 |
CONSOLIDATED_CONDENSED_STATEME3
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Operating Activities: | ||
Net income | $186,046 | $137,931 |
Adjustments to reconcile net income to net cash from continuing operating activities: | ||
Depreciation | 45,300 | 40,014 |
Earnings of equity method investments | -18,456 | -16,796 |
Loss from discontinued operations, net of tax | 1,889 | 4,634 |
Debt redemption costs | 17,753 | |
Deferred income taxes | 47,145 | 14,867 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -17,699 | -31,591 |
Inventories | -156,158 | -190,627 |
Floor plan notes payable | 126,343 | 256,015 |
Accounts payable and accrued expenses | 72,269 | 37,560 |
Other | 11,318 | -7,012 |
Net cash from continuing operating activities | 297,997 | 262,748 |
Investing Activities: | ||
Purchase of equipment and improvements | -122,952 | -96,380 |
Purchase of Penske Car Rental vehicles | -82,313 | |
Proceeds from sale-leaseback transactions | 1,584 | |
Acquisitions net, including repayment of sellers' floor plan notes payable of $1,045 and $49,467, respectively | -221,160 | -137,805 |
Other | -7,493 | 3,496 |
Net cash from continuing investing activities | -433,918 | -229,105 |
Financing Activities: | ||
Proceeds from borrowings under U.S. credit agreement revolving credit line | 808,700 | 525,800 |
Repayments under U.S. credit agreement revolving credit line | -814,700 | -657,800 |
Repayments under U.S. credit agreement term loan | -12,000 | -17,000 |
Repurchase of 3.5% senior subordinated convertible notes | -62,687 | |
Issuance of 5.75% senior subordinated notes | 550,000 | |
Repurchase of 7.75% senior subordinated notes | -390,755 | |
Net borrowings (repayments) of car rental revolver | 73,885 | |
Net borrowings (repayments) of other long-term debt | 67,940 | 15,087 |
Net borrowings (repayments) of floor plan notes payable - non-trade | 76,525 | 32,410 |
Repurchases of common stock | -15,813 | -9,829 |
Dividends | -40,663 | -29,760 |
Payment of deferred financing fees | -8,502 | |
Other | 235 | |
Net cash from continuing financing activities | 144,109 | -53,036 |
Discontinued operations: | ||
Net cash from discontinued operating activities | 11,845 | -3,704 |
Net cash from discontinued investing activities | 29,857 | 34,902 |
Net cash from discontinued financing activities | -22,236 | -12,916 |
Net cash from discontinued operations | 19,466 | 18,282 |
Net change in cash and cash equivalents | 27,654 | -1,111 |
Cash and cash equivalents, beginning of period | 43,447 | 26,997 |
Cash and cash equivalents, end of period | 71,101 | 25,886 |
Cash paid for: | ||
Interest | 61,986 | 64,340 |
Income taxes | $23,200 | $35,232 |
CONSOLIDATED_CONDENSED_STATEME4
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | ||
Dealership acquisitions net, repayment of sellers' floor plan notes payable | $1,045 | $49,467 |
CONSOLIDATED_CONDENSED_STATEME5
CONSOLIDATED CONDENSED STATEMENT OF EQUITY (USD $) | Total | Total Penske Automotive Group Stockholders' Equity | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interest |
In Thousands, except Share data, unless otherwise specified | |||||||
Balance at Dec. 31, 2012 | $1,316,321 | $1,304,215 | $9 | $700,013 | $611,026 | ($6,833) | $12,106 |
Balance (in shares) at Dec. 31, 2012 | 90,294,765 | ||||||
Increase (decrease) in stockholders' equity | |||||||
Equity compensation | 7,451 | 7,451 | 7,451 | ||||
Equity compensation (in shares) | 412,786 | ||||||
Repurchases of common stock | -15,813 | -15,813 | -15,813 | ||||
Repurchases of common stock (in shares) | -507,561 | ||||||
Dividends | -40,663 | -40,663 | -40,663 | ||||
Distributions to non-controlling interests | -1,247 | -1,247 | |||||
Sale of subsidiary shares to non-controlling interest | 378 | 235 | 235 | 143 | |||
Deconsolidation of Italian investment | -8,309 | -8,309 | |||||
Reconsolidation of Italian investment | 8,914 | 8,914 | |||||
Foreign currency translation | 6,714 | 6,180 | 6,180 | 534 | |||
Interest rate swaps | 2,997 | 2,997 | 2,997 | ||||
Forward exchange contracts | -4,013 | -4,013 | -4,013 | ||||
Other | -1,385 | -1,385 | -1,385 | ||||
Net income | 186,046 | 184,981 | 184,981 | 1,065 | |||
Balance at Sep. 30, 2013 | $1,457,391 | $1,444,185 | $9 | $691,886 | $755,344 | ($3,054) | $13,206 |
Balance (in shares) at Sep. 30, 2013 | 90,199,990 |
Interim_Financial_Statements
Interim Financial Statements | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Interim Financial Statements | ||||||||||||||
Interim Financial Statements | 1. Interim Financial Statements | |||||||||||||
Business Overview | ||||||||||||||
Unless the context otherwise requires, the use of the terms “PAG,” “we,” “us,” and “our” in these Notes to the Consolidated Condensed Financial Statements refers to Penske Automotive Group, Inc. and its consolidated subsidiaries. | ||||||||||||||
We are an international transportation services company, operating retail automotive dealerships, Hertz car rental franchises and commercial vehicle distribution. We are the second largest automotive retailer headquartered in the U.S. as measured by total revenue. As of September 30, 2013, we operated 321 retail franchises, of which 171 franchises are located in the U.S. and 150 franchises are located outside of the U.S. The franchises outside the U.S. are located primarily in the U.K. | ||||||||||||||
Each of our dealerships offers a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, we generate higher-margin revenue at each of our dealerships through maintenance and repair services and the sale and placement of higher-margin products, such as third-party finance and insurance products, third-party extended service contracts and replacement and aftermarket automotive products. We also hold a 9.0% ownership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading provider of transportation services and supply chain management. | ||||||||||||||
In August 2013, we completed the acquisition of Western Star Trucks Australia, the exclusive importer and distributor of Western Star commercial trucks, MAN commercial trucks and buses, and Dennis Eagle refuse collection vehicles, together with associated parts across Australia, New Zealand and portions of Southeast Asia. The business also includes two retail truck dealerships. We refer to this business as “Penske Commercial Vehicles.” Since our acquisition of Penske Commercial Vehicles on August 30, 2013, it has generated $49,426 of revenue, through the distribution and retail sale of vehicles and parts to a network of 84 dealerships. The purchase price of approximately $200,000 included vehicle inventory, parts and other assets, and is subject to a working capital adjustment that is expected to be finalized in the fourth quarter of 2013. | ||||||||||||||
During the nine months ended September 30, 2013, we acquired one U.K. franchise, Guy Salmon Land Rover Northampton. We also were awarded two franchises, Maserati of Warwick and Lamborghini Leicester. We disposed of twenty-six franchises representing nine different brands, principally consisting of ten Toyota/Lexus and twelve Chrysler/Jeep/Dodge franchises in the U.K. During the three months ended September 30, 2013, we acquired an additional 35% interest in our joint venture operating dealerships in northern Italy, resulting in a 70% controlling interest in the Italian joint venture as of September 30, 2013. | ||||||||||||||
We are the Hertz rental car franchisee in the Memphis, Tennessee market and certain Indiana markets. We currently operate more than fifty on- and off-airport Hertz rental car locations. Our Hertz car rental business generated $38,600 of revenue during the nine months ended September 30, 2013. | ||||||||||||||
Basis of Presentation | ||||||||||||||
The accompanying unaudited consolidated condensed financial statements of PAG have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of September 30, 2013 and December 31, 2012 and for the three and nine month periods ended September 30, 2013 and 2012 is unaudited, but includes all adjustments which the management of PAG believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities which have been treated as discontinued operations through September 30, 2013, and the results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with our audited financial statements for the year ended December 31, 2012, which are included as part of our Annual Report on Form 10-K. | ||||||||||||||
Recent Accounting Pronouncements | ||||||||||||||
In February 2013, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-02, “Comprehensive Income (Topic 220) — Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” ASU No. 2013-02 requires disclosure of amounts reclassified out of accumulated other comprehensive income by component. In addition, we are required to present either on the face of the statement of income or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required to be reclassified to net income in its entirety in the same reporting period. For amounts not reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional detail about those amounts. We complied with the disclosure requirements of this ASU beginning with the quarter ended March 31, 2013. | ||||||||||||||
In March 2013, the FASB issued ASU No. 2013-05, “Foreign Currency Matters (Topic 830) — Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.” ASU No. 2013-05 resolves the diversity in practice about whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. This ASU is effective prospectively for the first annual period beginning after December 15, 2013. We do not expect adoption of ASU No. 2013-05 to affect our consolidated financial position, results of operations, or cash flows. | ||||||||||||||
In July 2013, the FASB issued ASU No. 2013-10, “Derivatives and Hedging (Topic 815) — Inclusion of the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) as a Benchmark Interest Rate for Hedge Accounting Purposes.” The amendments in ASU No. 2013-10 permit the Fed Funds Effective Swap Rate to be used as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, in addition to UST and LIBOR. This ASU is effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. We do not expect the adoption of ASU No. 2013-10 to affect our consolidated financial position, results of operations, or cash flows. | ||||||||||||||
In July 2013, the FASB issued ASU No. 2013-11, “Income Taxes (Topic 740) — Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” ASU No. 2013-11 resolves the diversity in practice regarding the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This ASU is effective for the first annual period beginning after December 15, 2013. We do not expect adoption of ASU No. 2013-11 to affect our consolidated financial position, results of operations, or cash flows. | ||||||||||||||
Discontinued Operations | ||||||||||||||
We account for dispositions in our retail operations as discontinued operations when it is evident that the operations and cash flows of a franchise being disposed of will be eliminated from on-going operations and that we will not have any significant continuing involvement in its operations. | ||||||||||||||
In evaluating whether the cash flows of a dealership in our Retail reportable segment will be eliminated from ongoing operations, we consider whether it is likely that customers will migrate to similar franchises that we own in the same geographic market. Our consideration includes an evaluation of the brands sold at other dealerships we operate in the market and their proximity to the disposed dealership. When we dispose of franchises, we typically do not have continuing brand representation in that market. If the franchise being disposed of is located in a complex of PAG owned dealerships, we do not treat the disposition as a discontinued operation if we believe that the cash flows previously generated by the disposed franchise will be replaced by expanded operations of the remaining or replacement franchises. | ||||||||||||||
Combined financial information regarding entities accounted for as discontinued operations follows: | ||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues | $ | 15,158 | $ | 107,391 | $ | 162,953 | $ | 332,878 | ||||||
Pre-tax income (loss) | (955 | ) | (817 | ) | (2,609 | ) | (13,673 | ) | ||||||
Gain (loss) on disposal | (31 | ) | 285 | 809 | 10,445 | |||||||||
September 30, | December 31, | |||||||||||||
2013 | 2012 | |||||||||||||
Inventories | $ | 10 | $ | 44,649 | ||||||||||
Other assets | 1,055 | 26,458 | ||||||||||||
Total assets | $ | 1,065 | $ | 71,107 | ||||||||||
Floor plan notes payable (including non-trade) | $ | 40 | $ | 36,689 | ||||||||||
Other liabilities | 2,552 | 14,590 | ||||||||||||
Total liabilities | $ | 2,592 | $ | 51,279 | ||||||||||
Estimates | ||||||||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves. | ||||||||||||||
Fair Value of Financial Instruments | ||||||||||||||
Accounting standards define fair value as the price that would be received from selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Accounting standards establish a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value and also establishes the following three levels of inputs that may be used to measure fair value: | ||||||||||||||
Level 1 | Quoted prices in active markets for identical assets or liabilities | |||||||||||||
Level 2 | Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted market prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities | |||||||||||||
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities | |||||||||||||
Our financial instruments consist of cash and cash equivalents, debt, floor plan notes payable, forward exchange contracts and interest rate swaps used to hedge future cash flows. Other than our fixed rate debt, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. | ||||||||||||||
Our fixed rate debt consists of amounts outstanding under our senior subordinated notes and mortgage facilities. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 1), and we estimate the fair value of our mortgage facilities using a present value technique based on our current market interest rates for similar types of financial instruments (Level 2). A summary of the carrying values and fair values of our 5.75% senior subordinated notes and our fixed rate mortgage facilities are as follows: | ||||||||||||||
September 30, 2013 | ||||||||||||||
Carrying Value | Fair Value | |||||||||||||
5.75% senior subordinated notes due 2022 | $ | 550,000 | $ | 543,070 | ||||||||||
Mortgage facilities | 101,445 | 101,777 | ||||||||||||
Inventories
Inventories | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventories | ||||||||
Inventories | 2. Inventories | |||||||
Inventories consisted of the following: | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
New vehicles | $ | 1,497,648 | $ | 1,429,250 | ||||
Used vehicles | 582,695 | 484,269 | ||||||
Commercial vehicles | 121,575 | — | ||||||
Parts, accessories and other | 91,472 | 86,687 | ||||||
Total inventories | $ | 2,293,390 | $ | 2,000,206 | ||||
We receive credits from certain vehicle manufacturers that reduce cost of sales when the vehicles are sold. Such credits amounted to $26,445 and $23,085 during the nine months ended September 30, 2013 and 2012, respectively. |
Business_Combinations
Business Combinations | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Business Combinations | ||||||||||||||
Business Combinations | 3. Business Combinations | |||||||||||||
We acquired Penske Commercial Vehicles as discussed in Note 1, one Hertz car rental franchise market area and one automotive retail franchise during the nine months ended September 30, 2013. We acquired twenty-one automotive retail franchises during the nine months ended September 30, 2012. Our financial statements include the results of operations of the acquired entities from the date of acquisition. The fair value of the assets acquired and liabilities assumed have been recorded in our consolidated condensed financial statements, and may be subject to adjustment pending completion of final valuation. A summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed for the nine months ended September 30, 2013 and 2012 follows: | ||||||||||||||
September 30, | ||||||||||||||
2013 | 2012 | |||||||||||||
Accounts receivable | $ | 20,117 | $ | 28,907 | ||||||||||
Inventory | 124,259 | 94,627 | ||||||||||||
Other current assets | 2,812 | 411 | ||||||||||||
Property and equipment | 26,062 | 34,261 | ||||||||||||
Indefinite-lived intangibles | 133,075 | 61,686 | ||||||||||||
Other non-current assets | 8,427 | 745 | ||||||||||||
Current liabilities | (94,107 | ) | (58,926 | ) | ||||||||||
Non-current liabilities | 515 | (23,906 | ) | |||||||||||
Total consideration | 221,160 | 137,805 | ||||||||||||
Seller financed/assumed debt | — | — | ||||||||||||
Cash used in acquisitions | $ | 221,160 | $ | 137,805 | ||||||||||
The following unaudited consolidated pro forma results of operations of PAG for the three and nine months ended September 30, 2013 and 2012, give effect to acquisitions consummated during 2013 and 2012 as if they had occurred effective at the beginning of the period: | ||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues | $ | 3,892,754 | $ | 3,547,785 | $ | 11,244,562 | $ | 10,419,047 | ||||||
Income from continuing operations | 68,843 | 50,454 | 200,498 | 162,012 | ||||||||||
Net income | 67,844 | 49,638 | 197,544 | 156,388 | ||||||||||
Income from continuing operations per diluted common share | $ | 0.76 | $ | 0.56 | $ | 2.21 | $ | 1.78 | ||||||
Net income per diluted common share | $ | 0.75 | $ | 0.55 | $ | 2.19 | $ | 1.73 |
Intangible_Assets
Intangible Assets | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Intangible Assets | ||||||||
Intangible Assets | 4. Intangible Assets | |||||||
Following is a summary of the changes in the carrying amount of goodwill and franchise value during the nine months ended September 30, 2013: | ||||||||
Goodwill | Franchise | |||||||
Value | ||||||||
Balance, December 31, 2012 | $ | 980,438 | $ | 283,152 | ||||
Additions | 133,075 | — | ||||||
Deconsolidation of Italian investment | (7,231 | ) | (2,908 | ) | ||||
Reconsolidation of Italian investment | 7,434 | 3,068 | ||||||
Foreign currency translation | 4,653 | (184 | ) | |||||
Balance, September 30, 2013 | $ | 1,118,369 | $ | 283,128 | ||||
Goodwill additions of $5,780 and $125,596 were related to our Hertz rental car operations and Penske Commercial Vehicles, respectively, within our Other reportable segment. All other changes were within our Retail reportable segment. As of September 30, 2013, the goodwill balance within our Retail and Other reportable segments was $981,060 and $137,309, respectively. |
Floor_Plan_Notes_Payable_Trade
Floor Plan Notes Payable - Trade and Non-trade | 9 Months Ended |
Sep. 30, 2013 | |
Floor Plan Notes Payable - Trade and Non-trade | |
Floor Plan Notes Payable - Trade and Non-trade | 5. Floor Plan Notes Payable — Trade and Non-trade |
We finance substantially all of the commercial vehicles we purchase for distribution, new vehicles for retail sale and a portion of our used vehicle inventories for retail sale under revolving floor plan arrangements with various lenders, including the captive finance companies associated with automotive manufacturers. In the U.S., substantially all of our floor plan arrangements are due on demand; however, we have not historically been required to repay floor plan advances prior to the sale of the vehicles that have been financed. We typically make monthly interest payments on the amount financed. Outside of the U.S., substantially all of the floor plan arrangements are payable on demand or have an original maturity of 90 days or less, and we are generally required to repay floor plan advances at the earlier of the sale of the vehicles that have been financed or the stated maturity. | |
The floor plan agreements grant a security interest in substantially all of the assets of our dealership and distribution subsidiaries, and in the U.S., Australia and New Zealand are guaranteed by us. Interest rates under the floor plan arrangements are variable and increase or decrease based on changes in the prime rate, defined London Interbank Offered Rate (“LIBOR”), the Finance House Bank Rate, the Euro Interbank Offer Rate or the Australian or New Zealand Bank Bill Swap Rate. We classify floor plan notes payable to a party other than the manufacturer of a particular new vehicle or commercial vehicle, and all floor plan notes payable relating to pre-owned vehicles, as floor plan notes payable — non-trade on our consolidated condensed balance sheets and classify related cash flows as a financing activity on our consolidated condensed statements of cash flows. | |
Earnings_Per_Share
Earnings Per Share | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Earnings Per Share | ||||||||||
Earnings Per Share | 6. Earnings Per Share | |||||||||
Basic earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, including outstanding unvested equity awards which contain rights to non-forfeitable dividends. Diluted earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, adjusted for any dilutive effects. A reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three and nine months ended September 30, 2013 and 2012 follows: | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||
2013 | 2012 | 2013 | 2012 | |||||||
Weighted average number of common shares outstanding | 90,201,075 | 90,263,865 | 90,297,797 | 90,330,378 | ||||||
Effect of non-participatory equity compensation | 36,000 | 32,000 | 36,000 | 32,000 | ||||||
Weighted average number of common shares outstanding, including effect of dilutive securities | 90,237,075 | 90,295,865 | 90,333,797 | 90,362,378 | ||||||
LongTerm_Debt
Long-Term Debt | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Long-Term Debt | ||||||||
Long-Term Debt | 7. Long-Term Debt | |||||||
Long-term debt consisted of the following: | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
U.S. credit agreement - revolving credit line | $ | 44,000 | $ | 50,000 | ||||
U.S. credit agreement - term loan | 98,000 | 110,000 | ||||||
U.K. credit agreement - revolving credit line | 124,625 | 48,741 | ||||||
U.K. credit agreement - term loan | 31,561 | 38,993 | ||||||
U.K. credit agreement - overdraft line of credit | — | 6,838 | ||||||
5.75% senior subordinated notes due 2022 | 550,000 | 550,000 | ||||||
Rental car revolver | 97,056 | 23,171 | ||||||
Mortgage facilities | 101,445 | 104,043 | ||||||
Other | 14,277 | 5,731 | ||||||
Total long-term debt | 1,060,964 | 937,517 | ||||||
Less: current portion | (46,894 | ) | (19,493 | ) | ||||
Net long-term debt | $ | 1,014,070 | $ | 918,024 | ||||
U.S. Credit Agreement | ||||||||
We are party to a credit agreement with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, as amended (the “U.S. Credit Agreement”), which provides for up to $375,000 in revolving loans for working capital, acquisitions, capital expenditures, investments and other general corporate purposes, a non-amortizing term loan with a remaining balance of $98,000 and for an additional $10,000 of availability for letters of credit, through September 2016. The revolving loans bear interest at a defined LIBOR plus 2.25%, subject to an incremental 1.25% for uncollateralized borrowings in excess of a defined borrowing base. The term loan, which bears interest at defined LIBOR plus 2.25%, may be prepaid at any time, but then may not be re-borrowed. | ||||||||
The U.S. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by our domestic subsidiaries and contains a number of significant covenants that, among other things, restrict our ability to dispose of assets, incur additional indebtedness, repay other indebtedness, pay dividends, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. We are also required to comply with specified financial and other tests and ratios, each as defined in the U.S. Credit Agreement including: a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders’ equity and a ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of the amounts owed. As of September 30, 2013, we were in compliance with all covenants under the U.S. Credit Agreement. | ||||||||
The U.S. Credit Agreement also contains typical events of default, including change of control, non-payment of obligations and cross-defaults to our other material indebtedness. Substantially all of our domestic assets are subject to security interests granted to lenders under the U.S. Credit Agreement. As of September 30, 2013, $44,000 of revolver borrowings, $98,000 of term loans and no letters of credit were outstanding under the U.S. Credit Agreement. We repaid $12,000 under the term loan during the nine months ended September 30, 2013. | ||||||||
U.K. Credit Agreement | ||||||||
Our subsidiaries in the U.K. (the “U.K. subsidiaries”) are party to a £100,000 revolving credit agreement with the Royal Bank of Scotland plc (RBS) and BMW Financial Services (GB) Limited, and an additional £10,000 demand overdraft line of credit with RBS (collectively, the “U.K. credit agreement”) to be used for working capital, acquisitions, capital expenditures, investments and general corporate purposes through November 2015. The revolving loans bear interest between defined LIBOR plus 1.35% and defined LIBOR plus 3.0% and the demand overdraft line of credit bears interest at the Bank of England Base Rate plus 1.75%. As of September 30, 2013, £77,000 ($124,625) was outstanding under the U.K. credit agreement. | ||||||||
The U.K. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by our U.K. subsidiaries, and contains a number of significant covenants that, among other things, restrict the ability of our U.K. subsidiaries to pay dividends, dispose of assets, incur additional indebtedness, repay other indebtedness, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. In addition, our U.K. subsidiaries are required to comply with defined ratios and tests, including: a ratio of earnings before interest, taxes, amortization, and rental payments (“EBITAR”) to interest plus rental payments, a measurement of maximum capital expenditures, and a debt to EBITDA ratio. A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. As of September 30, 2013, our U.K. subsidiaries were in compliance with all covenants under the U.K. credit agreement. | ||||||||
The U.K. credit agreement also contains typical events of default, including change of control and non-payment of obligations and cross-defaults to other material indebtedness of our U.K. subsidiaries. Substantially all of our U.K. subsidiaries’ assets are subject to security interests granted to lenders under the U.K. credit agreement. In July 2013, we amended the U.K. credit agreement and U.K. term loan to provide the U.K. subsidiaries with covenant flexibility to fund the purchase of Penske Commercial Vehicles (discussed above) and operate the subsidiaries acquired. | ||||||||
In January 2012, our U.K. subsidiaries entered into a separate agreement with RBS, as agent for National Westminster Bank plc, providing for a £30,000 term loan which was used for working capital and an acquisition. The term loan is repayable in £1,500 quarterly installments through 2015 with a final payment of £7,500 due December 31, 2015. The term loan bears interest between 2.675% and 4.325%, depending on the U.K. subsidiaries’ ratio of net borrowings to earnings before interest, taxes, depreciation and amortization (as defined). As of September 30, 2013, the amount outstanding under the U.K. term loan was £19,500 ($31,561). | ||||||||
5.75% Senior Subordinated Notes | ||||||||
In August 2012, we issued $550,000 in aggregate principal amount of 5.75% Senior Subordinated Notes due 2022 (the “5.75% Notes”). | ||||||||
Interest on the 5.75% Notes is payable semiannually on April 1 and October 1 of each year, beginning on April 1, 2013. The 5.75% Notes mature on October 1, 2022, unless earlier redeemed or purchased by us. The 5.75% Notes are our unsecured senior subordinated obligations and are guaranteed on an unsecured senior subordinated basis by our existing 100% owned domestic subsidiaries. The 5.75% Notes also contain customary negative covenants and events of default. As of September 30, 2013, we were in compliance with all negative covenants, and there were no events of default. | ||||||||
On or after October 1, 2017, we may redeem the 5.75% Notes for cash at the redemption prices noted in the indenture, plus any accrued and unpaid interest. We may also redeem up to 40% of the 5.75% Notes using the proceeds of specified equity offerings at any time prior to October 1, 2015, at a price specified in the indenture. | ||||||||
If we experience certain “change of control” events specified in the indenture, holders of the 5.75% Notes will have the option to require us to purchase for cash all or a portion of their notes at a price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest. In addition, if we make certain asset sales and do not reinvest the proceeds thereof or use such proceeds to repay certain debt, we will be required to use the proceeds of such asset sales to make an offer to purchase the notes at a price equal to 100% of the principal amount of the notes, plus accrued and unpaid interest. | ||||||||
Rental Car Revolver | ||||||||
We are party to a credit agreement with Toyota Motor Credit Corporation that currently provides us with up to $150,000 in revolving loans for the acquisition of rental vehicles. The revolving loans bear interest at three-month LIBOR plus 2.50%. This agreement provides the lender with a secured interest in the vehicles and our rental car operations’ other assets, requires us to make monthly curtailment payments and expires in October 2014. As of September 30, 2013, outstanding loans under the rental car revolver amounted to $97,056. | ||||||||
Mortgage Facilities | ||||||||
We are party to several mortgages which bear interest at defined rates and require monthly principal and interest payments. These mortgage facilities also contain typical events of default, including non-payment of obligations, cross-defaults to our other material indebtedness, certain change of control events, and the loss or sale of certain franchises operated at the properties. Substantially all of the buildings and improvements on the properties financed pursuant to the mortgage facilities are subject to security interests granted to the lender. As of September 30, 2013, we owed $101,445 of principal under our mortgage facilities. |
Derivatives_and_Hedging
Derivatives and Hedging | 9 Months Ended |
Sep. 30, 2013 | |
Derivatives and Hedging | |
Derivatives and Hedging | 8. Derivatives and Hedging |
We periodically use interest rate swaps to manage interest rate risk associated with our variable rate floor plan debt. We are party to interest rate swap agreements through December 2014 pursuant to which the LIBOR portion of $300,000 of our floating rate floor plan debt is fixed at 2.135% and $100,000 of our floating rate floor plan debt is fixed at a rate of 1.55%. We may terminate these agreements at any time, subject to the settlement of the then current fair value of the swap arrangements. | |
We used Level 2 inputs to estimate the fair value of the interest rate swap agreements. As of September 30, 2013 and December 31, 2012, the fair value of the swaps designated as hedging instruments was estimated to be a liability of $9,379 and $14,337, respectively. During 2013 and 2012, there was no hedge ineffectiveness recorded in our income statement. During the three and nine months ended September 30, 2013, the swaps increased the weighted average interest rate on our floor plan borrowings by approximately 35 and 36 basis points, respectively. | |
Penske Commercial Vehicles sells vehicles and parts purchased from manufacturers in the U.S., Germany, and United Kingdom. In order to protect against exchange rate movements, we enter into forward foreign exchange contracts against anticipated cash flows. The contracts are timed to mature when major shipments are scheduled to arrive in Australia and when receipt of payment from customers is expected. We classify our forward foreign exchange contracts as cash flow hedges and state them at fair value. We used Level 2 inputs to estimate the fair value of the forward foreign exchange contracts. The fair value of the contracts designated as hedging instruments was estimated to be an asset of $1,965 as of September 30, 2013. | |
Commitments_and_Contingent_Lia
Commitments and Contingent Liabilities | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingent Liabilities | |
Commitments and Contingent Liabilities | 9. Commitments and Contingent Liabilities |
We are involved in litigation which may relate to claims brought by governmental authorities, issues with customers, and employment related matters, including class action claims and purported class action claims. As of September 30, 2013, we were not party to any legal proceedings, including class action lawsuits, that, individually or in the aggregate, are reasonably expected to have a material adverse effect on our results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our results of operations, financial condition or cash flows. | |
We have historically structured our operations so as to minimize ownership of real property. As a result, we lease or sublease substantially all of our facilities. These leases are generally for a period between five and 20 years, and are typically structured to include renewal options at our election. Pursuant to the leases for some of our larger facilities, we are required to comply with specified financial ratios, including a “rent coverage” ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require us to post collateral in the form of a letter of credit. A breach of the other lease covenants gives rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. As of September 30, 2013, we were in compliance with all covenants under these leases. | |
We have sold a number of dealerships to third parties and, as a condition to certain of those sales, remain liable for the lease payments relating to the properties on which those businesses operate in the event of non-payment by the buyer. We are also party to lease agreements on properties that we no longer use in our retail operations that we have sublet to third parties. We rely on subtenants to pay the rent and maintain the property at these locations. In the event the subtenant does not perform as expected, we may not be able to recover amounts owed to us and we could be required to fulfill these obligations. | |
We hold a 9.0% ownership interest in PTL. Historically General Electric Capital Corporation (“GECC”) has provided PTL with a majority of its financing. PTL has refinanced all of its GECC indebtedness. As part of that refinancing, we and the other PTL partners created a new company (“Holdings”), which, together with GECC, co-issued $700,000 of 3.8% senior unsecured notes due 2019 (the “Holdings Bonds”). A wholly-owned subsidiary of Holdings contributed $700,000 derived from the net proceeds from the offering of the Holdings Bonds and a portion of its cash on hand to PTL in exchange for a 21.5% limited partner interest in PTL. PTL used the $700,000 of funds to reduce its outstanding debt owed to GECC. GECC agreed to be a co-obligor of the Holdings Bonds in order to achieve lower interest rates on the Holdings Bonds. | |
Additional capital contributions from the members may be required to fund interest and principal payments on the Holdings Bonds. In addition, we have agreed to indemnify GECC for 9.0% of any principal or interest that GECC is required to pay as co-obligor, and pay GECC an annual fee of approximately $950 for acting as co-obligor. The maximum amount of our potential obligations to GECC under this agreement are 9.0% of the required principal repayment due in 2019 (which is expected to be $63,100) and 9.0% of interest payments under the Holdings Bonds, plus fees and default interest, if any. | |
Our floor plan credit agreement with Mercedes Benz Financial Services Australia (“MBA”) provides us revolving loans for the acquisition of commercial vehicles for distribution to our retail network. This facility includes a limited parent guarantee and a commitment to repurchase dealer vehicles in the event the dealer’s floor plan agreement with MBA is terminated. | |
We have $18,197 of letters of credit outstanding as of September 30, 2013, and have posted $9,154 of surety bonds in the ordinary course of business. | |
Equity
Equity | 9 Months Ended |
Sep. 30, 2013 | |
Equity | |
Equity | 10. Equity |
Share Repurchase | |
During the nine months ended September 30, 2013, we repurchased 410,000 shares of our outstanding common stock for $12,680, or an average of $30.93 per share, under a program approved by our Board of Directors. During the nine months ended September 30, 2013, we acquired 97,629 shares of our common stock for $3,135, or an average of $32.11, from employees in connection with a net share settlement feature of employee equity awards. | |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Income / (Loss) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Accumulated Other Comprehensive Income / (Loss) | ||||||||||||||
Accumulated Other Comprehensive Income / (Loss) | 11. Accumulated Other Comprehensive Income / (Loss) | |||||||||||||
The following tables below present the changes in accumulated other comprehensive income / (loss) by component and the reclassifications out of accumulated other comprehensive income / (loss) during the three and nine months ended September 30, 2013, attributable to Penske Automotive Group common stockholders. | ||||||||||||||
Three Months Ended September 30, 2013 | ||||||||||||||
Interest Rate | Foreign | Other | Total | |||||||||||
Swaps | Currency | |||||||||||||
Translation | ||||||||||||||
Balance at June 30, 2013 | $ | (6,505 | ) | $ | (36,825 | ) | $ | 1,825 | $ | (41,505 | ) | |||
Other comprehensive income before reclassifications | 272 | 41,811 | (4,184 | ) | 37,899 | |||||||||
Amounts reclassified from accumulated other comprehensive income - net of tax | 552 | — | — | 552 | ||||||||||
Net current-period other comprehensive income | 824 | 41,811 | (4,184 | ) | 38,451 | |||||||||
Balance at September 30, 2013 | $ | (5,681 | ) | $ | 4,986 | $ | (2,359 | ) | $ | (3,054 | ) | |||
Nine Months Ended September 30, 2013 | ||||||||||||||
Interest Rate | Foreign | Other | Total | |||||||||||
Swaps | Currency | |||||||||||||
Translation | ||||||||||||||
Balance at December 31, 2012 | $ | (8,678 | ) | $ | (1,194 | ) | $ | 3,039 | $ | (6,833 | ) | |||
Other comprehensive income before reclassifications | 784 | 7,064 | (5,398 | ) | 2,450 | |||||||||
Amounts reclassified from accumulated other comprehensive income - net of tax | 2,213 | (884 | ) | — | 1,329 | |||||||||
Net current-period other comprehensive income | 2,997 | 6,180 | (5,398 | ) | 3,779 | |||||||||
Balance at September 30, 2013 | $ | (5,681 | ) | $ | 4,986 | $ | (2,359 | ) | $ | (3,054 | ) | |||
Within the amounts reclassified from accumulated other comprehensive income, the $552 and $2,213 associated with interest rate swaps is included in floor plan interest expense, and the $(884) associated with foreign currency translation is included in selling, general, and administrative expenses. |
Segment_Information
Segment Information | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Segment Information | ||||||||||||||
Segment Information | 12. Segment Information | |||||||||||||
Our operations are organized by management into operating segments by line of business and geography. We have determined that we have two reportable segments as defined in generally accepted accounting principles for segment reporting: (i) Retail, consisting of our automotive retail operations, and (ii) Other, consisting of our Hertz rental car business operating segment, our investments in non-automotive retail operations operating segment and our Penske Commercial Vehicles operating segment. The Retail reportable segment includes all automotive dealerships and all departments relevant to the operation of the dealerships and the retail automotive joint ventures. The individual dealership operations included in the Retail reportable segment have been grouped into four geographic operating segments: Eastern, Central, and Western United States and International. The geographic operating segments have been aggregated into one reportable segment as their operations (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and used vehicles, service, parts and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals) and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions). | ||||||||||||||
Three Months Ended September 30 | ||||||||||||||
Retail | Other | Intersegment | Total | |||||||||||
Elimination | ||||||||||||||
Revenues | ||||||||||||||
2013 | $ | 3,763,840 | $ | 66,050 | $ | (5,747 | ) | $ | 3,824,143 | |||||
2012 | 3,336,020 | — | — | 3,336,020 | ||||||||||
Segment income | ||||||||||||||
2013 | 51,732 | 13,485 | 58 | 65,275 | ||||||||||
2012 | 33,119 | 7,912 | — | 41,031 | ||||||||||
Nine Months Ended September 30 | ||||||||||||||
Retail | Other | Intersegment | Total | |||||||||||
Elimination | ||||||||||||||
Revenues | ||||||||||||||
2013 | $ | 10,867,035 | $ | 88,026 | $ | (27,144 | ) | $ | 10,927,917 | |||||
2012 | 9,814,784 | — | — | 9,814,784 | ||||||||||
Segment income | ||||||||||||||
2013 | 162,074 | 23,178 | (271 | ) | 184,981 | |||||||||
2012 | 117,994 | 18,947 | — | 136,941 | ||||||||||
Consolidating_Condensed_Financ
Consolidating Condensed Financial Information | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Consolidating Condensed Financial Information | |||||||||||||||||
Consolidating Condensed Financial Information | 13. Consolidating Condensed Financial Information | ||||||||||||||||
The following tables include condensed consolidating financial information as of September 30, 2013 and December 31, 2012 and for the three and nine month periods ended September 30, 2013 and 2012 for Penske Automotive Group, Inc. (as the issuer of the 5.75% Notes), guarantor subsidiaries and non-guarantor subsidiaries (primarily representing foreign entities). Guarantor subsidiaries are directly or indirectly 100% owned by PAG, and the guarantees are full and unconditional, and jointly and several. The condensed consolidating financial information includes certain allocations of balance sheet, income statement and cash flow items which are not necessarily indicative of the financial position, results of operations and cash flows of these entities on a stand-alone basis. | |||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET | |||||||||||||||||
September 30, 2013 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Cash and cash equivalents | $ | 71,101 | $ | — | $ | — | $ | 7,514 | $ | 63,587 | |||||||
Accounts receivable, net | 588,311 | (378,659 | ) | 378,659 | 292,806 | 295,505 | |||||||||||
Inventories | 2,293,390 | — | — | 1,300,592 | 992,798 | ||||||||||||
Other current assets | 83,508 | — | 2,955 | 32,593 | 47,960 | ||||||||||||
Assets held for sale | 1,065 | — | — | 165 | 900 | ||||||||||||
Total current assets | 3,037,375 | (378,659 | ) | 381,614 | 1,633,670 | 1,400,750 | |||||||||||
Property and equipment, net | 1,211,020 | — | 4,251 | 814,083 | 392,686 | ||||||||||||
Intangible assets | 1,401,497 | — | — | 768,677 | 632,820 | ||||||||||||
Equity method investments | 333,081 | — | 280,730 | — | 52,351 | ||||||||||||
Other long-term assets | 27,831 | (1,602,664 | ) | 1,613,941 | 5,232 | 11,322 | |||||||||||
Total assets | $ | 6,010,804 | $ | (1,981,323 | ) | $ | 2,280,536 | $ | 3,221,662 | $ | 2,489,929 | ||||||
Floor plan notes payable | $ | 1,537,185 | $ | — | $ | — | $ | 884,700 | $ | 652,485 | |||||||
Floor plan notes payable — non-trade | 802,051 | — | 128,100 | 375,983 | 297,968 | ||||||||||||
Accounts payable | 380,000 | — | 2,841 | 128,236 | 248,923 | ||||||||||||
Accrued expenses | 275,483 | (378,659 | ) | 205 | 142,530 | 511,407 | |||||||||||
Current portion of long-term debt | 46,894 | — | — | 36,236 | 10,658 | ||||||||||||
Liabilities held for sale | 2,592 | — | — | 383 | 2,209 | ||||||||||||
Total current liabilities | 3,044,205 | (378,659 | ) | 131,146 | 1,568,068 | 1,723,650 | |||||||||||
Long-term debt | 1,014,070 | (96,472 | ) | 692,000 | 166,262 | 252,280 | |||||||||||
Deferred tax liabilities | 338,430 | — | — | 313,342 | 25,088 | ||||||||||||
Other long-term liabilities | 156,708 | — | — | 77,865 | 78,843 | ||||||||||||
Total liabilities | 4,553,413 | (475,131 | ) | 823,146 | 2,125,537 | 2,079,861 | |||||||||||
Total equity | 1,457,391 | (1,506,192 | ) | 1,457,390 | 1,096,125 | 410,068 | |||||||||||
Total liabilities and equity | $ | 6,010,804 | $ | (1,981,323 | ) | $ | 2,280,536 | $ | 3,221,662 | $ | 2,489,929 | ||||||
CONDENSED CONSOLIDATING BALANCE SHEET | |||||||||||||||||
December 31, 2012 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Cash and cash equivalents | $ | 43,447 | $ | — | $ | — | $ | 36,478 | $ | 6,969 | |||||||
Accounts receivable, net | 554,851 | (340,917 | ) | 340,917 | 375,442 | 179,409 | |||||||||||
Inventories | 2,000,206 | — | — | 1,212,521 | 787,685 | ||||||||||||
Other current assets | 90,485 | — | 3,546 | 55,841 | 31,098 | ||||||||||||
Assets held for sale | 71,107 | — | — | 28,716 | 42,391 | ||||||||||||
Total current assets | 2,760,096 | (340,917 | ) | 344,463 | 1,708,998 | 1,047,552 | |||||||||||
Property and equipment, net | 1,031,188 | — | 4,474 | 662,722 | 363,992 | ||||||||||||
Intangible assets | 1,263,590 | — | — | 761,005 | 502,585 | ||||||||||||
Equity method investments | 303,160 | — | 252,816 | — | 50,344 | ||||||||||||
Other long-term assets | 20,956 | (1,527,156 | ) | 1,540,447 | 5,029 | 2,636 | |||||||||||
Total assets | $ | 5,378,990 | $ | (1,868,073 | ) | $ | 2,142,200 | $ | 3,137,754 | $ | 1,967,109 | ||||||
Floor plan notes payable | $ | 1,408,362 | $ | — | $ | — | $ | 917,391 | $ | 490,971 | |||||||
Floor plan notes payable — non-trade | 725,526 | — | 112,085 | 346,683 | 266,758 | ||||||||||||
Accounts payable | 263,881 | — | 3,344 | 124,663 | 135,874 | ||||||||||||
Accrued expenses | 223,972 | (340,917 | ) | 450 | 114,636 | 449,803 | |||||||||||
Current portion of long-term debt | 19,493 | — | — | 9,745 | 9,748 | ||||||||||||
Liabilities held for sale | 51,279 | — | — | 17,766 | 33,513 | ||||||||||||
Total current liabilities | 2,692,513 | (340,917 | ) | 115,879 | 1,530,884 | 1,386,667 | |||||||||||
Long-term debt | 918,024 | (38,692 | ) | 710,000 | 121,618 | 125,098 | |||||||||||
Deferred tax liabilities | 287,818 | — | — | 260,445 | 27,373 | ||||||||||||
Other long-term liabilities | 164,314 | — | — | 85,151 | 79,163 | ||||||||||||
Total liabilities | 4,062,669 | (379,609 | ) | 825,879 | 1,998,098 | 1,618,301 | |||||||||||
Total equity | 1,316,321 | (1,488,464 | ) | 1,316,321 | 1,139,656 | 348,808 | |||||||||||
Total liabilities and equity | $ | 5,378,990 | $ | (1,868,073 | ) | $ | 2,142,200 | $ | 3,137,754 | $ | 1,967,109 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Three Months Ended September 30, 2013 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 3,824,143 | $ | — | $ | — | $ | 2,296,224 | $ | 1,527,919 | |||||||
Cost of sales | 3,244,235 | — | — | 1,933,197 | 1,311,038 | ||||||||||||
Gross profit | 579,908 | — | — | 363,027 | 216,881 | ||||||||||||
Selling, general and administrative expenses | 454,188 | — | 5,475 | 280,222 | 168,491 | ||||||||||||
Depreciation | 15,784 | — | 417 | 9,538 | 5,829 | ||||||||||||
Operating income (loss) | 109,936 | — | (5,892 | ) | 73,267 | 42,561 | |||||||||||
Floor plan interest expense | (10,840 | ) | — | (2,428 | ) | (4,951 | ) | (3,461 | ) | ||||||||
Other interest expense | (12,370 | ) | — | (7,159 | ) | (1,951 | ) | (3,260 | ) | ||||||||
Equity in earnings of affiliates | 11,240 | — | 10,035 | — | 1,205 | ||||||||||||
Equity in earnings of subsidiaries | — | (103,153 | ) | 103,153 | — | — | |||||||||||
Income (loss) from continuing operations before income taxes | 97,966 | (103,153 | ) | 97,709 | 66,365 | 37,045 | |||||||||||
Income taxes | (31,692 | ) | 33,458 | (31,692 | ) | (24,116 | ) | (9,342 | ) | ||||||||
Income (loss) from continuing operations | 66,274 | (69,695 | ) | 66,017 | 42,249 | 27,703 | |||||||||||
Income (loss) from discontinued operations, net of tax | (742 | ) | 742 | (742 | ) | (151 | ) | (591 | ) | ||||||||
Net income (loss) | 65,532 | (68,953 | ) | 65,275 | 42,098 | 27,112 | |||||||||||
Other comprenhensive income (loss), net of tax | 38,449 | (38,622 | ) | 38,449 | 824 | 37,798 | |||||||||||
Comprehensive income | 103,981 | (107,575 | ) | 103,724 | 42,922 | 64,910 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 257 | — | — | — | 257 | ||||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 103,724 | $ | (107,575 | ) | $ | 103,724 | $ | 42,922 | $ | 64,653 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Three Months Ended September 30, 2012 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 3,336,020 | $ | — | $ | — | $ | 1,997,423 | $ | 1,338,597 | |||||||
Cost of sales | 2,834,536 | — | — | 1,687,417 | 1,147,119 | ||||||||||||
Gross profit | 501,484 | — | — | 310,006 | 191,478 | ||||||||||||
Selling, general and administrative expenses | 400,039 | — | 5,073 | 244,259 | 150,707 | ||||||||||||
Depreciation | 13,704 | — | 328 | 7,580 | 5,796 | ||||||||||||
Operating income (loss) | 87,741 | — | (5,401 | ) | 58,167 | 34,975 | |||||||||||
Floor plan interest expense | (9,951 | ) | — | (2,322 | ) | (4,300 | ) | (3,329 | ) | ||||||||
Other interest expense | (11,583 | ) | — | (7,695 | ) | (804 | ) | (3,084 | ) | ||||||||
Equity in earnings of affiliates | 8,814 | — | 7,784 | — | 1,030 | ||||||||||||
Equity in earnings of subsidiaries | — | (82,373 | ) | 82,373 | — | — | |||||||||||
Debt redemption costs | (17,753 | ) | — | (17,753 | ) | — | — | ||||||||||
Income (loss) from continuing operations before income taxes | 57,268 | (82,373 | ) | 56,986 | 53,063 | 29,592 | |||||||||||
Income taxes | (15,421 | ) | 22,292 | (15,421 | ) | (14,733 | ) | (7,559 | ) | ||||||||
Income (loss) from continuing operations | 41,847 | (60,081 | ) | 41,565 | 38,330 | 22,033 | |||||||||||
Income (loss) from discontinued operations, net of tax | (534 | ) | 534 | (534 | ) | 219 | (753 | ) | |||||||||
Net income (loss) | 41,313 | (59,547 | ) | 41,031 | 38,549 | 21,280 | |||||||||||
Other comprehensive income (loss), net of tax | 17,948 | (16,882 | ) | 17,948 | 175 | 16,707 | |||||||||||
Comprehensive income | 59,261 | (76,429 | ) | 58,979 | 38,724 | 37,987 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 489 | (207 | ) | 207 | — | 489 | |||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 58,772 | $ | (76,222 | ) | $ | 58,772 | $ | 38,724 | $ | 37,498 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 10,927,917 | $ | — | $ | — | $ | 6,616,079 | $ | 4,311,838 | |||||||
Cost of sales | 9,244,779 | — | — | 5,545,896 | 3,698,883 | ||||||||||||
Gross profit | 1,683,138 | — | — | 1,070,183 | 612,955 | ||||||||||||
Selling, general and administrative expenses | 1,308,958 | — | 15,328 | 820,249 | 473,381 | ||||||||||||
Depreciation | 45,300 | — | 1,206 | 26,743 | 17,351 | ||||||||||||
Operating income (loss) | 328,880 | — | (16,534 | ) | 223,191 | 122,223 | |||||||||||
Floor plan interest expense | (32,008 | ) | — | (7,174 | ) | (15,044 | ) | (9,790 | ) | ||||||||
Other interest expense | (36,163 | ) | — | (20,555 | ) | (4,214 | ) | (11,394 | ) | ||||||||
Equity in earnings of affiliates | 22,489 | — | 18,865 | — | 3,624 | ||||||||||||
Equity in earnings of subsidiaries | — | (307,531 | ) | 307,531 | — | — | |||||||||||
Income (loss) from continuing operations before income taxes | 283,198 | (307,531 | ) | 282,133 | 203,933 | 104,663 | |||||||||||
Income taxes | (95,263 | ) | 103,839 | (95,263 | ) | (77,745 | ) | (26,094 | ) | ||||||||
Income (loss) from continuing operations | 187,935 | (203,692 | ) | 186,870 | 126,188 | 78,569 | |||||||||||
Income (loss) from discontinued operations, net of tax | (1,889 | ) | 1,889 | (1,889 | ) | (184 | ) | (1,705 | ) | ||||||||
Net income (loss) | 186,046 | (201,803 | ) | 184,981 | 126,004 | 76,864 | |||||||||||
Other comprehensive income (loss), net of tax | 4,313 | (4,516 | ) | 4,313 | 2,997 | 1,519 | |||||||||||
Comprehensive income | 190,359 | (206,319 | ) | 189,294 | 129,001 | 78,383 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 1,599 | (534 | ) | 534 | — | 1,599 | |||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 188,760 | $ | (205,785 | ) | $ | 188,760 | $ | 129,001 | $ | 76,784 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Nine Months Ended September 30, 2012 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 9,814,784 | $ | — | $ | — | $ | 5,821,934 | $ | 3,992,850 | |||||||
Cost of sales | 8,313,365 | — | — | 4,897,098 | 3,416,267 | ||||||||||||
Gross profit | 1,501,419 | — | — | 924,836 | 576,583 | ||||||||||||
Selling, general and administrative expenses | 1,188,658 | — | 14,408 | 728,842 | 445,408 | ||||||||||||
Depreciation | 40,014 | — | 936 | 22,018 | 17,060 | ||||||||||||
Operating income (loss) | 272,747 | — | (15,344 | ) | 173,976 | 114,115 | |||||||||||
Floor plan interest expense | (29,319 | ) | — | (6,774 | ) | (12,247 | ) | (10,298 | ) | ||||||||
Other interest expense | (35,155 | ) | — | (21,986 | ) | (2,668 | ) | (10,501 | ) | ||||||||
Equity in earnings of affiliates | 21,392 | — | 18,538 | — | 2,854 | ||||||||||||
Equity in earnings of subsidiaries | — | (254,241 | ) | 254,241 | — | — | |||||||||||
Debt redemption costs | (17,753 | ) | — | (17,753 | ) | — | — | ||||||||||
Income (loss) from continuing operations before income taxes | 211,912 | (254,241 | ) | 210,922 | 159,061 | 96,170 | |||||||||||
Income taxes | (69,347 | ) | 83,603 | (69,347 | ) | (59,519 | ) | (24,084 | ) | ||||||||
Income (loss) from continuing operations | 142,565 | (170,638 | ) | 141,575 | 99,542 | 72,086 | |||||||||||
Income (loss) from discontinued operations, net of tax | (4,634 | ) | 4,634 | (4,634 | ) | (1,830 | ) | (2,804 | ) | ||||||||
Net income (loss) | 137,931 | (166,004 | ) | 136,941 | 97,712 | 69,282 | |||||||||||
Other comprehensive income (loss), net of tax | 17,758 | (15,150 | ) | 17,758 | (74 | ) | 15,224 | ||||||||||
Comprehensive income | 155,689 | (181,154 | ) | 154,699 | 97,638 | 84,506 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 1,197 | (207 | ) | 207 | — | 1,197 | |||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 154,492 | $ | (180,947 | ) | $ | 154,492 | $ | 97,638 | $ | 83,309 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||||||
Total | Penske | Guarantor | Non-Guarantor | ||||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Net cash from continuing operating activities | $ | 297,997 | $ | 59,444 | $ | 56,502 | $ | 182,051 | |||||||||
Investing activities: | |||||||||||||||||
Purchase of equipment and improvements | (122,952 | ) | (983 | ) | (84,506 | ) | (37,463 | ) | |||||||||
Purchase of Penske Car Rental vehicles | (82,313 | ) | — | (82,313 | ) | — | |||||||||||
Acquisitions, net | (221,160 | ) | — | (22,005 | ) | (199,155 | ) | ||||||||||
Other | (7,493 | ) | — | (7,522 | ) | 29 | |||||||||||
Net cash from continuing investing activities | (433,918 | ) | (983 | ) | (196,346 | ) | (236,589 | ) | |||||||||
Financing activities: | |||||||||||||||||
Net borrowings (repayments) of long-term debt | 123,825 | (18,000 | ) | 71,147 | 70,678 | ||||||||||||
Net borrowings (repayments) of floor plan notes payable — non-trade | 76,525 | 16,015 | 29,300 | 31,210 | |||||||||||||
Repurchases of common stock | (15,813 | ) | (15,813 | ) | — | — | |||||||||||
Dividends | (40,663 | ) | (40,663 | ) | — | — | |||||||||||
Distributions from (to) parent | — | — | 1,154 | (1,154 | ) | ||||||||||||
Other | 235 | — | — | 235 | |||||||||||||
Net cash from continuing financing activities | 144,109 | (58,461 | ) | 101,601 | 100,969 | ||||||||||||
Net cash from discontinued operations | 19,466 | — | 9,279 | 10,187 | |||||||||||||
Net change in cash and cash equivalents | 27,654 | — | (28,964 | ) | 56,618 | ||||||||||||
Cash and cash equivalents, beginning of period | 43,447 | — | 36,478 | 6,969 | |||||||||||||
Cash and cash equivalents, end of period | $ | 71,101 | $ | — | $ | 7,514 | $ | 63,587 | |||||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Nine Months Ended September 30, 2012 | |||||||||||||||||
Total | Penske | Guarantor | Non-Guarantor | ||||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Net cash from continuing operating activities | $ | 262,748 | $ | 95,748 | $ | 40,064 | $ | 126,936 | |||||||||
Investing activities: | |||||||||||||||||
Purchase of equipment and improvements | (96,380 | ) | (766 | ) | (67,233 | ) | (28,381 | ) | |||||||||
Proceeds from sale-leaseback transactions | 1,584 | — | — | 1,584 | |||||||||||||
Acquisitions, net | (137,805 | ) | — | (3,416 | ) | (134,389 | ) | ||||||||||
Other | 3,496 | (3,812 | ) | — | 7,308 | ||||||||||||
Net cash from continuing investing activities | (229,105 | ) | (4,578 | ) | (70,649 | ) | (153,878 | ) | |||||||||
Financing activities: | |||||||||||||||||
Repurchase of 3.5% senior subordinated convertible notes | (62,687 | ) | (62,687 | ) | — | — | |||||||||||
Issuance of 5.75% senior subordinated notes | 550,000 | 550,000 | — | — | |||||||||||||
Repurchase of 7.75% senior subordinated notes | (390,755 | ) | (390,755 | ) | — | — | |||||||||||
Net borrowings (repayments) of long-term debt | (133,913 | ) | (149,000 | ) | (1,598 | ) | 16,685 | ||||||||||
Net borrowings (repayments) of floor plan notes payable — non-trade | 32,410 | 9,363 | 11,471 | 11,576 | |||||||||||||
Repurchases of common stock | (9,829 | ) | (9,829 | ) | — | — | |||||||||||
Dividends | (29,760 | ) | (29,760 | ) | — | — | |||||||||||
Payment of deferred financing fees | (8,502 | ) | (8,502 | ) | — | — | |||||||||||
Distributions from (to) parent | — | — | 4,747 | (4,747 | ) | ||||||||||||
Net cash from continuing financing activities | (53,036 | ) | (91,170 | ) | 14,620 | 23,514 | |||||||||||
Net cash from discontinued operations | 18,282 | — | 6,725 | 11,557 | |||||||||||||
Net change in cash and cash equivalents | (1,111 | ) | — | (9,240 | ) | 8,129 | |||||||||||
Cash and cash equivalents, beginning of period | 26,997 | — | 26,767 | 230 | |||||||||||||
Cash and cash equivalents, end of period | $ | 25,886 | $ | — | $ | 17,527 | $ | 8,359 | |||||||||
Interim_Financial_Statements_P
Interim Financial Statements (Policies) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Interim Financial Statements | ||||||||||||||
Basis of Presentation | Basis of Presentation | |||||||||||||
The accompanying unaudited consolidated condensed financial statements of PAG have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in our annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of September 30, 2013 and December 31, 2012 and for the three and nine month periods ended September 30, 2013 and 2012 is unaudited, but includes all adjustments which the management of PAG believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities which have been treated as discontinued operations through September 30, 2013, and the results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with our audited financial statements for the year ended December 31, 2012, which are included as part of our Annual Report on Form 10-K. | ||||||||||||||
Recent Accounting Pronouncements | Recent Accounting Pronouncements | |||||||||||||
In February 2013, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2013-02, “Comprehensive Income (Topic 220) — Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” ASU No. 2013-02 requires disclosure of amounts reclassified out of accumulated other comprehensive income by component. In addition, we are required to present either on the face of the statement of income or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required to be reclassified to net income in its entirety in the same reporting period. For amounts not reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional detail about those amounts. We complied with the disclosure requirements of this ASU beginning with the quarter ended March 31, 2013. | ||||||||||||||
In March 2013, the FASB issued ASU No. 2013-05, “Foreign Currency Matters (Topic 830) — Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.” ASU No. 2013-05 resolves the diversity in practice about whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. This ASU is effective prospectively for the first annual period beginning after December 15, 2013. We do not expect adoption of ASU No. 2013-05 to affect our consolidated financial position, results of operations, or cash flows. | ||||||||||||||
In July 2013, the FASB issued ASU No. 2013-10, “Derivatives and Hedging (Topic 815) — Inclusion of the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) as a Benchmark Interest Rate for Hedge Accounting Purposes.” The amendments in ASU No. 2013-10 permit the Fed Funds Effective Swap Rate to be used as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, in addition to UST and LIBOR. This ASU is effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. We do not expect the adoption of ASU No. 2013-10 to affect our consolidated financial position, results of operations, or cash flows. | ||||||||||||||
In July 2013, the FASB issued ASU No. 2013-11, “Income Taxes (Topic 740) — Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” ASU No. 2013-11 resolves the diversity in practice regarding the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This ASU is effective for the first annual period beginning after December 15, 2013. We do not expect adoption of ASU No. 2013-11 to affect our consolidated financial position, results of operations, or cash flows. | ||||||||||||||
Discontinued Operations | Discontinued Operations | |||||||||||||
We account for dispositions in our retail operations as discontinued operations when it is evident that the operations and cash flows of a franchise being disposed of will be eliminated from on-going operations and that we will not have any significant continuing involvement in its operations. | ||||||||||||||
In evaluating whether the cash flows of a dealership in our Retail reportable segment will be eliminated from ongoing operations, we consider whether it is likely that customers will migrate to similar franchises that we own in the same geographic market. Our consideration includes an evaluation of the brands sold at other dealerships we operate in the market and their proximity to the disposed dealership. When we dispose of franchises, we typically do not have continuing brand representation in that market. If the franchise being disposed of is located in a complex of PAG owned dealerships, we do not treat the disposition as a discontinued operation if we believe that the cash flows previously generated by the disposed franchise will be replaced by expanded operations of the remaining or replacement franchises. | ||||||||||||||
Combined financial information regarding entities accounted for as discontinued operations follows: | ||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues | $ | 15,158 | $ | 107,391 | $ | 162,953 | $ | 332,878 | ||||||
Pre-tax income (loss) | (955 | ) | (817 | ) | (2,609 | ) | (13,673 | ) | ||||||
Gain (loss) on disposal | (31 | ) | 285 | 809 | 10,445 | |||||||||
September 30, | December 31, | |||||||||||||
2013 | 2012 | |||||||||||||
Inventories | $ | 10 | $ | 44,649 | ||||||||||
Other assets | 1,055 | 26,458 | ||||||||||||
Total assets | $ | 1,065 | $ | 71,107 | ||||||||||
Floor plan notes payable (including non-trade) | $ | 40 | $ | 36,689 | ||||||||||
Other liabilities | 2,552 | 14,590 | ||||||||||||
Total liabilities | $ | 2,592 | $ | 51,279 | ||||||||||
Estimates | Estimates | |||||||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves. | ||||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments | |||||||||||||
Accounting standards define fair value as the price that would be received from selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Accounting standards establish a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value and also establishes the following three levels of inputs that may be used to measure fair value: | ||||||||||||||
Level 1 | Quoted prices in active markets for identical assets or liabilities | |||||||||||||
Level 2 | Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted market prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities | |||||||||||||
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities | |||||||||||||
Our financial instruments consist of cash and cash equivalents, debt, floor plan notes payable, forward exchange contracts and interest rate swaps used to hedge future cash flows. Other than our fixed rate debt, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. | ||||||||||||||
Our fixed rate debt consists of amounts outstanding under our senior subordinated notes and mortgage facilities. We estimate the fair value of our senior unsecured notes using quoted prices for the identical liability (Level 1), and we estimate the fair value of our mortgage facilities using a present value technique based on our current market interest rates for similar types of financial instruments (Level 2). A summary of the carrying values and fair values of our 5.75% senior subordinated notes and our fixed rate mortgage facilities are as follows: | ||||||||||||||
September 30, 2013 | ||||||||||||||
Carrying Value | Fair Value | |||||||||||||
5.75% senior subordinated notes due 2022 | $ | 550,000 | $ | 543,070 | ||||||||||
Mortgage facilities | 101,445 | 101,777 | ||||||||||||
Interim_Financial_Statements_T
Interim Financial Statements (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Interim Financial Statements | ||||||||||||||
Combined financial information regarding entities accounted for as discontinued operations | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues | $ | 15,158 | $ | 107,391 | $ | 162,953 | $ | 332,878 | ||||||
Pre-tax income (loss) | (955 | ) | (817 | ) | (2,609 | ) | (13,673 | ) | ||||||
Gain (loss) on disposal | (31 | ) | 285 | 809 | 10,445 | |||||||||
September 30, | December 31, | |||||||||||||
2013 | 2012 | |||||||||||||
Inventories | $ | 10 | $ | 44,649 | ||||||||||
Other assets | 1,055 | 26,458 | ||||||||||||
Total assets | $ | 1,065 | $ | 71,107 | ||||||||||
Floor plan notes payable (including non-trade) | $ | 40 | $ | 36,689 | ||||||||||
Other liabilities | 2,552 | 14,590 | ||||||||||||
Total liabilities | $ | 2,592 | $ | 51,279 | ||||||||||
Summary of carrying values and fair values of senior subordinated notes and fixed rate mortgage facilities | ||||||||||||||
September 30, 2013 | ||||||||||||||
Carrying Value | Fair Value | |||||||||||||
5.75% senior subordinated notes due 2022 | $ | 550,000 | $ | 543,070 | ||||||||||
Mortgage facilities | 101,445 | 101,777 | ||||||||||||
Inventories_Tables
Inventories (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventories | ||||||||
Inventories Net | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
New vehicles | $ | 1,497,648 | $ | 1,429,250 | ||||
Used vehicles | 582,695 | 484,269 | ||||||
Commercial vehicles | 121,575 | — | ||||||
Parts, accessories and other | 91,472 | 86,687 | ||||||
Total inventories | $ | 2,293,390 | $ | 2,000,206 |
Business_Combinations_Tables
Business Combinations (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Business Combinations | ||||||||||||||
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed | September 30, | |||||||||||||
2013 | 2012 | |||||||||||||
Accounts receivable | $ | 20,117 | $ | 28,907 | ||||||||||
Inventory | 124,259 | 94,627 | ||||||||||||
Other current assets | 2,812 | 411 | ||||||||||||
Property and equipment | 26,062 | 34,261 | ||||||||||||
Indefinite-lived intangibles | 133,075 | 61,686 | ||||||||||||
Other non-current assets | 8,427 | 745 | ||||||||||||
Current liabilities | (94,107 | ) | (58,926 | ) | ||||||||||
Non-current liabilities | 515 | (23,906 | ) | |||||||||||
Total consideration | 221,160 | 137,805 | ||||||||||||
Seller financed/assumed debt | — | — | ||||||||||||
Cash used in acquisitions | $ | 221,160 | $ | 137,805 | ||||||||||
Summary of unaudited consolidated pro forma results of operations | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
Revenues | $ | 3,892,754 | $ | 3,547,785 | $ | 11,244,562 | $ | 10,419,047 | ||||||
Income from continuing operations | 68,843 | 50,454 | 200,498 | 162,012 | ||||||||||
Net income | 67,844 | 49,638 | 197,544 | 156,388 | ||||||||||
Income from continuing operations per diluted common share | $ | 0.76 | $ | 0.56 | $ | 2.21 | $ | 1.78 | ||||||
Net income per diluted common share | $ | 0.75 | $ | 0.55 | $ | 2.19 | $ | 1.73 |
Intangible_Assets_Tables
Intangible Assets (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Intangible Assets | ||||||||
Summary of the changes in the carrying amount of goodwill and franchise value | Goodwill | Franchise | ||||||
Value | ||||||||
Balance, December 31, 2012 | $ | 980,438 | $ | 283,152 | ||||
Additions | 133,075 | — | ||||||
Deconsolidation of Italian investment | (7,231 | ) | (2,908 | ) | ||||
Reconsolidation of Italian investment | 7,434 | 3,068 | ||||||
Foreign currency translation | 4,653 | (184 | ) | |||||
Balance, September 30, 2013 | $ | 1,118,369 | $ | 283,128 |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Earnings Per Share | ||||||||||
Reconciliation of number of shares used in calculation of basic and diluted earning per share | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||
2013 | 2012 | 2013 | 2012 | |||||||
Weighted average number of common shares outstanding | 90,201,075 | 90,263,865 | 90,297,797 | 90,330,378 | ||||||
Effect of non-participatory equity compensation | 36,000 | 32,000 | 36,000 | 32,000 | ||||||
Weighted average number of common shares outstanding, including effect of dilutive securities | 90,237,075 | 90,295,865 | 90,333,797 | 90,362,378 |
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Long-Term Debt | ||||||||
Long Term Debt | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
U.S. credit agreement - revolving credit line | $ | 44,000 | $ | 50,000 | ||||
U.S. credit agreement - term loan | 98,000 | 110,000 | ||||||
U.K. credit agreement - revolving credit line | 124,625 | 48,741 | ||||||
U.K. credit agreement - term loan | 31,561 | 38,993 | ||||||
U.K. credit agreement - overdraft line of credit | — | 6,838 | ||||||
5.75% senior subordinated notes due 2022 | 550,000 | 550,000 | ||||||
Rental car revolver | 97,056 | 23,171 | ||||||
Mortgage facilities | 101,445 | 104,043 | ||||||
Other | 14,277 | 5,731 | ||||||
Total long-term debt | 1,060,964 | 937,517 | ||||||
Less: current portion | (46,894 | ) | (19,493 | ) | ||||
Net long-term debt | $ | 1,014,070 | $ | 918,024 |
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Income / (Loss) (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Accumulated Other Comprehensive Income / (Loss) | ||||||||||||||
Schedule of the changes in accumulated other comprehensive income/ (loss) by component and the reclassifications out of accumulated other comprehensive income/ (loss) attributable to the entity's common stockholders | Three Months Ended September 30, 2013 | |||||||||||||
Interest Rate | Foreign | Other | Total | |||||||||||
Swaps | Currency | |||||||||||||
Translation | ||||||||||||||
Balance at June 30, 2013 | $ | (6,505 | ) | $ | (36,825 | ) | $ | 1,825 | $ | (41,505 | ) | |||
Other comprehensive income before reclassifications | 272 | 41,811 | (4,184 | ) | 37,899 | |||||||||
Amounts reclassified from accumulated other comprehensive income - net of tax | 552 | — | — | 552 | ||||||||||
Net current-period other comprehensive income | 824 | 41,811 | (4,184 | ) | 38,451 | |||||||||
Balance at September 30, 2013 | $ | (5,681 | ) | $ | 4,986 | $ | (2,359 | ) | $ | (3,054 | ) | |||
Nine Months Ended September 30, 2013 | ||||||||||||||
Interest Rate | Foreign | Other | Total | |||||||||||
Swaps | Currency | |||||||||||||
Translation | ||||||||||||||
Balance at December 31, 2012 | $ | (8,678 | ) | $ | (1,194 | ) | $ | 3,039 | $ | (6,833 | ) | |||
Other comprehensive income before reclassifications | 784 | 7,064 | (5,398 | ) | 2,450 | |||||||||
Amounts reclassified from accumulated other comprehensive income - net of tax | 2,213 | (884 | ) | — | 1,329 | |||||||||
Net current-period other comprehensive income | 2,997 | 6,180 | (5,398 | ) | 3,779 | |||||||||
Balance at September 30, 2013 | $ | (5,681 | ) | $ | 4,986 | $ | (2,359 | ) | $ | (3,054 | ) |
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | |||||||||||||
Sep. 30, 2013 | ||||||||||||||
Segment Information | ||||||||||||||
Revenues and adjusted segment income by reportable segment | Three Months Ended September 30 | |||||||||||||
Retail | Other | Intersegment | Total | |||||||||||
Elimination | ||||||||||||||
Revenues | ||||||||||||||
2013 | $ | 3,763,840 | $ | 66,050 | $ | (5,747 | ) | $ | 3,824,143 | |||||
2012 | 3,336,020 | — | — | 3,336,020 | ||||||||||
Segment income | ||||||||||||||
2013 | 51,732 | 13,485 | 58 | 65,275 | ||||||||||
2012 | 33,119 | 7,912 | — | 41,031 | ||||||||||
Nine Months Ended September 30 | ||||||||||||||
Retail | Other | Intersegment | Total | |||||||||||
Elimination | ||||||||||||||
Revenues | ||||||||||||||
2013 | $ | 10,867,035 | $ | 88,026 | $ | (27,144 | ) | $ | 10,927,917 | |||||
2012 | 9,814,784 | — | — | 9,814,784 | ||||||||||
Segment income | ||||||||||||||
2013 | 162,074 | 23,178 | (271 | ) | 184,981 | |||||||||
2012 | 117,994 | 18,947 | — | 136,941 | ||||||||||
Consolidating_Condensed_Financ1
Consolidating Condensed Financial Information (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Consolidating Condensed Financial Information | |||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET | |||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET | |||||||||||||||||
September 30, 2013 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Cash and cash equivalents | $ | 71,101 | $ | — | $ | — | $ | 7,514 | $ | 63,587 | |||||||
Accounts receivable, net | 588,311 | (378,659 | ) | 378,659 | 292,806 | 295,505 | |||||||||||
Inventories | 2,293,390 | — | — | 1,300,592 | 992,798 | ||||||||||||
Other current assets | 83,508 | — | 2,955 | 32,593 | 47,960 | ||||||||||||
Assets held for sale | 1,065 | — | — | 165 | 900 | ||||||||||||
Total current assets | 3,037,375 | (378,659 | ) | 381,614 | 1,633,670 | 1,400,750 | |||||||||||
Property and equipment, net | 1,211,020 | — | 4,251 | 814,083 | 392,686 | ||||||||||||
Intangible assets | 1,401,497 | — | — | 768,677 | 632,820 | ||||||||||||
Equity method investments | 333,081 | — | 280,730 | — | 52,351 | ||||||||||||
Other long-term assets | 27,831 | (1,602,664 | ) | 1,613,941 | 5,232 | 11,322 | |||||||||||
Total assets | $ | 6,010,804 | $ | (1,981,323 | ) | $ | 2,280,536 | $ | 3,221,662 | $ | 2,489,929 | ||||||
Floor plan notes payable | $ | 1,537,185 | $ | — | $ | — | $ | 884,700 | $ | 652,485 | |||||||
Floor plan notes payable — non-trade | 802,051 | — | 128,100 | 375,983 | 297,968 | ||||||||||||
Accounts payable | 380,000 | — | 2,841 | 128,236 | 248,923 | ||||||||||||
Accrued expenses | 275,483 | (378,659 | ) | 205 | 142,530 | 511,407 | |||||||||||
Current portion of long-term debt | 46,894 | — | — | 36,236 | 10,658 | ||||||||||||
Liabilities held for sale | 2,592 | — | — | 383 | 2,209 | ||||||||||||
Total current liabilities | 3,044,205 | (378,659 | ) | 131,146 | 1,568,068 | 1,723,650 | |||||||||||
Long-term debt | 1,014,070 | (96,472 | ) | 692,000 | 166,262 | 252,280 | |||||||||||
Deferred tax liabilities | 338,430 | — | — | 313,342 | 25,088 | ||||||||||||
Other long-term liabilities | 156,708 | — | — | 77,865 | 78,843 | ||||||||||||
Total liabilities | 4,553,413 | (475,131 | ) | 823,146 | 2,125,537 | 2,079,861 | |||||||||||
Total equity | 1,457,391 | (1,506,192 | ) | 1,457,390 | 1,096,125 | 410,068 | |||||||||||
Total liabilities and equity | $ | 6,010,804 | $ | (1,981,323 | ) | $ | 2,280,536 | $ | 3,221,662 | $ | 2,489,929 | ||||||
CONDENSED CONSOLIDATING BALANCE SHEET | |||||||||||||||||
December 31, 2012 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Cash and cash equivalents | $ | 43,447 | $ | — | $ | — | $ | 36,478 | $ | 6,969 | |||||||
Accounts receivable, net | 554,851 | (340,917 | ) | 340,917 | 375,442 | 179,409 | |||||||||||
Inventories | 2,000,206 | — | — | 1,212,521 | 787,685 | ||||||||||||
Other current assets | 90,485 | — | 3,546 | 55,841 | 31,098 | ||||||||||||
Assets held for sale | 71,107 | — | — | 28,716 | 42,391 | ||||||||||||
Total current assets | 2,760,096 | (340,917 | ) | 344,463 | 1,708,998 | 1,047,552 | |||||||||||
Property and equipment, net | 1,031,188 | — | 4,474 | 662,722 | 363,992 | ||||||||||||
Intangible assets | 1,263,590 | — | — | 761,005 | 502,585 | ||||||||||||
Equity method investments | 303,160 | — | 252,816 | — | 50,344 | ||||||||||||
Other long-term assets | 20,956 | (1,527,156 | ) | 1,540,447 | 5,029 | 2,636 | |||||||||||
Total assets | $ | 5,378,990 | $ | (1,868,073 | ) | $ | 2,142,200 | $ | 3,137,754 | $ | 1,967,109 | ||||||
Floor plan notes payable | $ | 1,408,362 | $ | — | $ | — | $ | 917,391 | $ | 490,971 | |||||||
Floor plan notes payable — non-trade | 725,526 | — | 112,085 | 346,683 | 266,758 | ||||||||||||
Accounts payable | 263,881 | — | 3,344 | 124,663 | 135,874 | ||||||||||||
Accrued expenses | 223,972 | (340,917 | ) | 450 | 114,636 | 449,803 | |||||||||||
Current portion of long-term debt | 19,493 | — | — | 9,745 | 9,748 | ||||||||||||
Liabilities held for sale | 51,279 | — | — | 17,766 | 33,513 | ||||||||||||
Total current liabilities | 2,692,513 | (340,917 | ) | 115,879 | 1,530,884 | 1,386,667 | |||||||||||
Long-term debt | 918,024 | (38,692 | ) | 710,000 | 121,618 | 125,098 | |||||||||||
Deferred tax liabilities | 287,818 | — | — | 260,445 | 27,373 | ||||||||||||
Other long-term liabilities | 164,314 | — | — | 85,151 | 79,163 | ||||||||||||
Total liabilities | 4,062,669 | (379,609 | ) | 825,879 | 1,998,098 | 1,618,301 | |||||||||||
Total equity | 1,316,321 | (1,488,464 | ) | 1,316,321 | 1,139,656 | 348,808 | |||||||||||
Total liabilities and equity | $ | 5,378,990 | $ | (1,868,073 | ) | $ | 2,142,200 | $ | 3,137,754 | $ | 1,967,109 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | CONDENSED CONSOLIDATING STATEMENT OF INCOME | ||||||||||||||||
Three Months Ended September 30, 2013 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 3,824,143 | $ | — | $ | — | $ | 2,296,224 | $ | 1,527,919 | |||||||
Cost of sales | 3,244,235 | — | — | 1,933,197 | 1,311,038 | ||||||||||||
Gross profit | 579,908 | — | — | 363,027 | 216,881 | ||||||||||||
Selling, general and administrative expenses | 454,188 | — | 5,475 | 280,222 | 168,491 | ||||||||||||
Depreciation | 15,784 | — | 417 | 9,538 | 5,829 | ||||||||||||
Operating income (loss) | 109,936 | — | (5,892 | ) | 73,267 | 42,561 | |||||||||||
Floor plan interest expense | (10,840 | ) | — | (2,428 | ) | (4,951 | ) | (3,461 | ) | ||||||||
Other interest expense | (12,370 | ) | — | (7,159 | ) | (1,951 | ) | (3,260 | ) | ||||||||
Equity in earnings of affiliates | 11,240 | — | 10,035 | — | 1,205 | ||||||||||||
Equity in earnings of subsidiaries | — | (103,153 | ) | 103,153 | — | — | |||||||||||
Income (loss) from continuing operations before income taxes | 97,966 | (103,153 | ) | 97,709 | 66,365 | 37,045 | |||||||||||
Income taxes | (31,692 | ) | 33,458 | (31,692 | ) | (24,116 | ) | (9,342 | ) | ||||||||
Income (loss) from continuing operations | 66,274 | (69,695 | ) | 66,017 | 42,249 | 27,703 | |||||||||||
Income (loss) from discontinued operations, net of tax | (742 | ) | 742 | (742 | ) | (151 | ) | (591 | ) | ||||||||
Net income (loss) | 65,532 | (68,953 | ) | 65,275 | 42,098 | 27,112 | |||||||||||
Other comprenhensive income (loss), net of tax | 38,449 | (38,622 | ) | 38,449 | 824 | 37,798 | |||||||||||
Comprehensive income | 103,981 | (107,575 | ) | 103,724 | 42,922 | 64,910 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 257 | — | — | — | 257 | ||||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 103,724 | $ | (107,575 | ) | $ | 103,724 | $ | 42,922 | $ | 64,653 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Three Months Ended September 30, 2012 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 3,336,020 | $ | — | $ | — | $ | 1,997,423 | $ | 1,338,597 | |||||||
Cost of sales | 2,834,536 | — | — | 1,687,417 | 1,147,119 | ||||||||||||
Gross profit | 501,484 | — | — | 310,006 | 191,478 | ||||||||||||
Selling, general and administrative expenses | 400,039 | — | 5,073 | 244,259 | 150,707 | ||||||||||||
Depreciation | 13,704 | — | 328 | 7,580 | 5,796 | ||||||||||||
Operating income (loss) | 87,741 | — | (5,401 | ) | 58,167 | 34,975 | |||||||||||
Floor plan interest expense | (9,951 | ) | — | (2,322 | ) | (4,300 | ) | (3,329 | ) | ||||||||
Other interest expense | (11,583 | ) | — | (7,695 | ) | (804 | ) | (3,084 | ) | ||||||||
Equity in earnings of affiliates | 8,814 | — | 7,784 | — | 1,030 | ||||||||||||
Equity in earnings of subsidiaries | — | (82,373 | ) | 82,373 | — | — | |||||||||||
Debt redemption costs | (17,753 | ) | — | (17,753 | ) | — | — | ||||||||||
Income (loss) from continuing operations before income taxes | 57,268 | (82,373 | ) | 56,986 | 53,063 | 29,592 | |||||||||||
Income taxes | (15,421 | ) | 22,292 | (15,421 | ) | (14,733 | ) | (7,559 | ) | ||||||||
Income (loss) from continuing operations | 41,847 | (60,081 | ) | 41,565 | 38,330 | 22,033 | |||||||||||
Income (loss) from discontinued operations, net of tax | (534 | ) | 534 | (534 | ) | 219 | (753 | ) | |||||||||
Net income (loss) | 41,313 | (59,547 | ) | 41,031 | 38,549 | 21,280 | |||||||||||
Other comprehensive income (loss), net of tax | 17,948 | (16,882 | ) | 17,948 | 175 | 16,707 | |||||||||||
Comprehensive income | 59,261 | (76,429 | ) | 58,979 | 38,724 | 37,987 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 489 | (207 | ) | 207 | — | 489 | |||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 58,772 | $ | (76,222 | ) | $ | 58,772 | $ | 38,724 | $ | 37,498 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 10,927,917 | $ | — | $ | — | $ | 6,616,079 | $ | 4,311,838 | |||||||
Cost of sales | 9,244,779 | — | — | 5,545,896 | 3,698,883 | ||||||||||||
Gross profit | 1,683,138 | — | — | 1,070,183 | 612,955 | ||||||||||||
Selling, general and administrative expenses | 1,308,958 | — | 15,328 | 820,249 | 473,381 | ||||||||||||
Depreciation | 45,300 | — | 1,206 | 26,743 | 17,351 | ||||||||||||
Operating income (loss) | 328,880 | — | (16,534 | ) | 223,191 | 122,223 | |||||||||||
Floor plan interest expense | (32,008 | ) | — | (7,174 | ) | (15,044 | ) | (9,790 | ) | ||||||||
Other interest expense | (36,163 | ) | — | (20,555 | ) | (4,214 | ) | (11,394 | ) | ||||||||
Equity in earnings of affiliates | 22,489 | — | 18,865 | — | 3,624 | ||||||||||||
Equity in earnings of subsidiaries | — | (307,531 | ) | 307,531 | — | — | |||||||||||
Income (loss) from continuing operations before income taxes | 283,198 | (307,531 | ) | 282,133 | 203,933 | 104,663 | |||||||||||
Income taxes | (95,263 | ) | 103,839 | (95,263 | ) | (77,745 | ) | (26,094 | ) | ||||||||
Income (loss) from continuing operations | 187,935 | (203,692 | ) | 186,870 | 126,188 | 78,569 | |||||||||||
Income (loss) from discontinued operations, net of tax | (1,889 | ) | 1,889 | (1,889 | ) | (184 | ) | (1,705 | ) | ||||||||
Net income (loss) | 186,046 | (201,803 | ) | 184,981 | 126,004 | 76,864 | |||||||||||
Other comprehensive income (loss), net of tax | 4,313 | (4,516 | ) | 4,313 | 2,997 | 1,519 | |||||||||||
Comprehensive income | 190,359 | (206,319 | ) | 189,294 | 129,001 | 78,383 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 1,599 | (534 | ) | 534 | — | 1,599 | |||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 188,760 | $ | (205,785 | ) | $ | 188,760 | $ | 129,001 | $ | 76,784 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF INCOME | |||||||||||||||||
Nine Months Ended September 30, 2012 | |||||||||||||||||
Total | Eliminations | Penske | Guarantor | Non-Guarantor | |||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Revenues | $ | 9,814,784 | $ | — | $ | — | $ | 5,821,934 | $ | 3,992,850 | |||||||
Cost of sales | 8,313,365 | — | — | 4,897,098 | 3,416,267 | ||||||||||||
Gross profit | 1,501,419 | — | — | 924,836 | 576,583 | ||||||||||||
Selling, general and administrative expenses | 1,188,658 | — | 14,408 | 728,842 | 445,408 | ||||||||||||
Depreciation | 40,014 | — | 936 | 22,018 | 17,060 | ||||||||||||
Operating income (loss) | 272,747 | — | (15,344 | ) | 173,976 | 114,115 | |||||||||||
Floor plan interest expense | (29,319 | ) | — | (6,774 | ) | (12,247 | ) | (10,298 | ) | ||||||||
Other interest expense | (35,155 | ) | — | (21,986 | ) | (2,668 | ) | (10,501 | ) | ||||||||
Equity in earnings of affiliates | 21,392 | — | 18,538 | — | 2,854 | ||||||||||||
Equity in earnings of subsidiaries | — | (254,241 | ) | 254,241 | — | — | |||||||||||
Debt redemption costs | (17,753 | ) | — | (17,753 | ) | — | — | ||||||||||
Income (loss) from continuing operations before income taxes | 211,912 | (254,241 | ) | 210,922 | 159,061 | 96,170 | |||||||||||
Income taxes | (69,347 | ) | 83,603 | (69,347 | ) | (59,519 | ) | (24,084 | ) | ||||||||
Income (loss) from continuing operations | 142,565 | (170,638 | ) | 141,575 | 99,542 | 72,086 | |||||||||||
Income (loss) from discontinued operations, net of tax | (4,634 | ) | 4,634 | (4,634 | ) | (1,830 | ) | (2,804 | ) | ||||||||
Net income (loss) | 137,931 | (166,004 | ) | 136,941 | 97,712 | 69,282 | |||||||||||
Other comprehensive income (loss), net of tax | 17,758 | (15,150 | ) | 17,758 | (74 | ) | 15,224 | ||||||||||
Comprehensive income | 155,689 | (181,154 | ) | 154,699 | 97,638 | 84,506 | |||||||||||
Less: Comprehensive income attributable to non-controlling interests | 1,197 | (207 | ) | 207 | — | 1,197 | |||||||||||
Comprehensive income attributable to Penske Automotive Group common stockholders | $ | 154,492 | $ | (180,947 | ) | $ | 154,492 | $ | 97,638 | $ | 83,309 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | ||||||||||||||||
Nine Months Ended September 30, 2013 | |||||||||||||||||
Total | Penske | Guarantor | Non-Guarantor | ||||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Net cash from continuing operating activities | $ | 297,997 | $ | 59,444 | $ | 56,502 | $ | 182,051 | |||||||||
Investing activities: | |||||||||||||||||
Purchase of equipment and improvements | (122,952 | ) | (983 | ) | (84,506 | ) | (37,463 | ) | |||||||||
Purchase of Penske Car Rental vehicles | (82,313 | ) | — | (82,313 | ) | — | |||||||||||
Acquisitions, net | (221,160 | ) | — | (22,005 | ) | (199,155 | ) | ||||||||||
Other | (7,493 | ) | — | (7,522 | ) | 29 | |||||||||||
Net cash from continuing investing activities | (433,918 | ) | (983 | ) | (196,346 | ) | (236,589 | ) | |||||||||
Financing activities: | |||||||||||||||||
Net borrowings (repayments) of long-term debt | 123,825 | (18,000 | ) | 71,147 | 70,678 | ||||||||||||
Net borrowings (repayments) of floor plan notes payable — non-trade | 76,525 | 16,015 | 29,300 | 31,210 | |||||||||||||
Repurchases of common stock | (15,813 | ) | (15,813 | ) | — | — | |||||||||||
Dividends | (40,663 | ) | (40,663 | ) | — | — | |||||||||||
Distributions from (to) parent | — | — | 1,154 | (1,154 | ) | ||||||||||||
Other | 235 | — | — | 235 | |||||||||||||
Net cash from continuing financing activities | 144,109 | (58,461 | ) | 101,601 | 100,969 | ||||||||||||
Net cash from discontinued operations | 19,466 | — | 9,279 | 10,187 | |||||||||||||
Net change in cash and cash equivalents | 27,654 | — | (28,964 | ) | 56,618 | ||||||||||||
Cash and cash equivalents, beginning of period | 43,447 | — | 36,478 | 6,969 | |||||||||||||
Cash and cash equivalents, end of period | $ | 71,101 | $ | — | $ | 7,514 | $ | 63,587 | |||||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Nine Months Ended September 30, 2012 | |||||||||||||||||
Total | Penske | Guarantor | Non-Guarantor | ||||||||||||||
Company | Automotive | Subsidiaries | Subsidiaries | ||||||||||||||
Group | |||||||||||||||||
(In thousands) | |||||||||||||||||
Net cash from continuing operating activities | $ | 262,748 | $ | 95,748 | $ | 40,064 | $ | 126,936 | |||||||||
Investing activities: | |||||||||||||||||
Purchase of equipment and improvements | (96,380 | ) | (766 | ) | (67,233 | ) | (28,381 | ) | |||||||||
Proceeds from sale-leaseback transactions | 1,584 | — | — | 1,584 | |||||||||||||
Acquisitions, net | (137,805 | ) | — | (3,416 | ) | (134,389 | ) | ||||||||||
Other | 3,496 | (3,812 | ) | — | 7,308 | ||||||||||||
Net cash from continuing investing activities | (229,105 | ) | (4,578 | ) | (70,649 | ) | (153,878 | ) | |||||||||
Financing activities: | |||||||||||||||||
Repurchase of 3.5% senior subordinated convertible notes | (62,687 | ) | (62,687 | ) | — | — | |||||||||||
Issuance of 5.75% senior subordinated notes | 550,000 | 550,000 | — | — | |||||||||||||
Repurchase of 7.75% senior subordinated notes | (390,755 | ) | (390,755 | ) | — | — | |||||||||||
Net borrowings (repayments) of long-term debt | (133,913 | ) | (149,000 | ) | (1,598 | ) | 16,685 | ||||||||||
Net borrowings (repayments) of floor plan notes payable — non-trade | 32,410 | 9,363 | 11,471 | 11,576 | |||||||||||||
Repurchases of common stock | (9,829 | ) | (9,829 | ) | — | — | |||||||||||
Dividends | (29,760 | ) | (29,760 | ) | — | — | |||||||||||
Payment of deferred financing fees | (8,502 | ) | (8,502 | ) | — | — | |||||||||||
Distributions from (to) parent | — | — | 4,747 | (4,747 | ) | ||||||||||||
Net cash from continuing financing activities | (53,036 | ) | (91,170 | ) | 14,620 | 23,514 | |||||||||||
Net cash from discontinued operations | 18,282 | — | 6,725 | 11,557 | |||||||||||||
Net change in cash and cash equivalents | (1,111 | ) | — | (9,240 | ) | 8,129 | |||||||||||
Cash and cash equivalents, beginning of period | 26,997 | — | 26,767 | 230 | |||||||||||||
Cash and cash equivalents, end of period | $ | 25,886 | $ | — | $ | 17,527 | $ | 8,359 | |||||||||
Interim_Financial_Statements_D
Interim Financial Statements (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 1 Months Ended | 9 Months Ended | |||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
item | item | Northern Italy | Penske Commercial Vehicles | Penske Commercial Vehicles | Penske Commercial Vehicles | Hertz car rental franchise | Penske Truck Leasing Co., L.P. | Toyota/Lexus | Chrysler/Jeep/Dodge | |||
item | item | item | item | item | ||||||||
Interim Financial Statements | ||||||||||||
Total number of owned and operated franchises | 321 | 321 | ||||||||||
Number of owned and operated franchises in US | 171 | 171 | ||||||||||
Number of owned and operated franchises outside US | 150 | 150 | ||||||||||
Significant Accounting Policies | ||||||||||||
Ownership interest in Penske Truck Leasing Co (as a percent) | 9.00% | |||||||||||
Number of truck retail dealerships owned by the reporting entity | 2 | |||||||||||
Revenue | $3,824,143 | $3,336,020 | $10,927,917 | $9,814,784 | $49,426 | $38,600 | ||||||
Number of dealerships in a certified network | 84 | |||||||||||
Purchase price | $221,160 | $137,805 | $200,000 | |||||||||
Number of acquired franchises | 1 | 1 | ||||||||||
Number of franchises awarded to the reporting entity | 2 | |||||||||||
Number of franchises disposed of | 26 | 10 | 12 | |||||||||
Number of different brands represented by franchises awarded to the reporting entity | 9 | |||||||||||
Additional ownership interest acquired (as a percent) | 35.00% | |||||||||||
Ownership interest (as a percent) | 70.00% | |||||||||||
Minimum number of on and off-airport locations in which company operates | 50 | 50 |
Interim_Financial_Statements_D1
Interim Financial Statements (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Balance Sheet information regarding entities accounted for as discontinued operations | |||||
Total liabilities | $2,592 | $2,592 | $51,279 | ||
Fair Value of Financial Instruments | |||||
Debt instrument, Carrying Value | 1,060,964 | 1,060,964 | 937,517 | ||
5.75% senior subordinated notes due 2022 | |||||
Balance Sheet information regarding entities accounted for as discontinued operations | |||||
Interest rate (as a percent) | 5.75% | 5.75% | 5.75% | 5.75% | 5.75% |
Fair Value of Financial Instruments | |||||
Debt instrument, Carrying Value | 550,000 | 550,000 | 550,000 | ||
5.75% senior subordinated notes due 2022 | Level 1 | |||||
Fair Value of Financial Instruments | |||||
Debt instrument, Fair Value | 543,070 | 543,070 | |||
Mortgage facilities | |||||
Fair Value of Financial Instruments | |||||
Debt instrument, Carrying Value | 101,445 | 101,445 | 104,043 | ||
Mortgage facilities | Level 2 | |||||
Fair Value of Financial Instruments | |||||
Debt instrument, Fair Value | 101,777 | 101,777 | |||
Retail | |||||
Combined financial information regarding entities accounted for as discontinued operations | |||||
Revenues | 15,158 | 107,391 | 162,953 | 332,878 | |
Pre-tax income (loss) | -955 | -817 | -2,609 | -13,673 | |
Gain on disposal | -31 | 285 | 809 | 10,445 | |
Balance Sheet information regarding entities accounted for as discontinued operations | |||||
Inventories | 10 | 10 | 44,649 | ||
Other assets | 1,055 | 1,055 | 26,458 | ||
Total assets | 1,065 | 1,065 | 71,107 | ||
Floor plan notes payable (including non-trade) | 40 | 40 | 36,689 | ||
Other liabilities | 2,552 | 2,552 | 14,590 | ||
Total liabilities | $2,592 | $2,592 | $51,279 |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventories Net | ||
New vehicles | $1,497,648 | $1,429,250 |
Used vehicles | 582,695 | 484,269 |
Commercial vehicles | 121,575 | |
Parts, accessories and other | 91,472 | 86,687 |
Total inventories | $2,293,390 | $2,000,206 |
Inventories_Details_2
Inventories (Details 2) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Inventories | ||
Interest credits and advertising assistance | $26,445 | $23,085 |
Business_Combinations_Details
Business Combinations (Details) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
item | item | |
Business combinations | ||
Number of acquired franchises | 1 | |
Hertz car rental franchise | ||
Business combinations | ||
Number of acquired franchises | 1 | |
Automotive retail franchise | ||
Business combinations | ||
Number of acquired franchises | 1 | 21 |
Business_Combinations_Details_
Business Combinations (Details 2) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed | ||
Accounts receivable | $20,117 | $28,907 |
Inventory | 124,259 | 94,627 |
Other current assets | 2,812 | 411 |
Property and equipment | 26,062 | 34,261 |
Indefinite-lived intangibles | 133,075 | 61,686 |
Other non-current assets | 8,427 | 745 |
Current liabilities | -94,107 | -58,926 |
Non-current liabilities | 515 | -23,906 |
Total consideration | 221,160 | 137,805 |
Cash used in acquisitions | $22,160 | $137,805 |
Business_Combinations_Details_1
Business Combinations (Details 3) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Summary of unaudited consolidated pro forma results of operations | ||||
Revenues | $3,892,754 | $3,547,785 | $11,244,562 | $10,419,047 |
Income from continuing operations | 68,843 | 50,454 | 200,498 | 162,012 |
Net income | $67,844 | $49,638 | $197,544 | $156,388 |
Income from continuing operations per diluted common share (in dollars per share) | $0.76 | $0.56 | $2.21 | $1.78 |
Net income per diluted common share (in dollars per share) | $0.75 | $0.55 | $2.19 | $1.73 |
Intangible_Assets_Details
Intangible Assets (Details) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Summary of the changes in the carrying amount of goodwill and franchise value | |
Goodwill, Beginning Balance | $980,438 |
Goodwill, Additions | 133,075 |
Goodwill, Deconsolidation of Italian investment | -7,231 |
Goodwill, Reconsolidation of Italian investment | 7,434 |
Goodwill, Foreign currency translation | 4,653 |
Goodwill, Ending Balance | 1,118,369 |
Franchise value, Beginning Balance | 283,152 |
Franchise value, Deconsolidation of Italian investment | -2,908 |
Franchise value, Reconsolidation of Italian investment | 3,068 |
Franchise value, Foreign currency translation | -184 |
Franchise value, Ending Balance | 283,128 |
Intangible assets | |
Goodwill | 1,118,369 |
Goodwill, Additions | 133,075 |
Retail | |
Summary of the changes in the carrying amount of goodwill and franchise value | |
Goodwill, Ending Balance | 981,060 |
Intangible assets | |
Goodwill | 981,060 |
Other | |
Summary of the changes in the carrying amount of goodwill and franchise value | |
Goodwill, Ending Balance | 137,309 |
Intangible assets | |
Goodwill | 137,309 |
Other | Hertz car rental franchise | |
Summary of the changes in the carrying amount of goodwill and franchise value | |
Goodwill, Additions | 5,780 |
Intangible assets | |
Goodwill, Additions | 5,780 |
Other | Penske Commercial Vehicles | |
Summary of the changes in the carrying amount of goodwill and franchise value | |
Goodwill, Additions | 125,596 |
Intangible assets | |
Goodwill, Additions | $125,596 |
Floor_Plan_Notes_Payable_Trade1
Floor Plan Notes Payable - Trade and Non-trade (Details) | 9 Months Ended |
Sep. 30, 2013 | |
Floor plan notes payable - trade and non-trade | |
Maturity period of floor plan arrangements outside the U.S. if not payable on demand | 90 days |
Earnings_Per_Share_Details
Earnings Per Share (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Reconciliation of number of shares used in calculation of basic and diluted earning per share | ||||
Weighted average number of common shares outstanding | 90,201,075 | 90,263,865 | 90,297,797 | 90,330,378 |
Effect of non-participatory equity compensation (in shares) | 36,000 | 32,000 | 36,000 | 32,000 |
Weighted average number of common shares outstanding, including effect of dilutive securities | 90,237,075 | 90,295,865 | 90,333,797 | 90,362,378 |
LongTerm_Debt_Details
Long-Term Debt (Details) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Jan. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Aug. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Aug. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | USD ($) | USD ($) | US Credit Agreement Revolving Credit Line | US Credit Agreement Revolving Credit Line | US Credit Agreement Term Loan | US Credit Agreement Term Loan | UK Credit Agreement Revolving Credit Line | UK Credit Agreement Revolving Credit Line | UK Credit Agreement Revolving Credit Line | UK Credit Agreement Revolving Credit Line | UK Credit Agreement Revolving Credit Line | U.K. Agreement Term Loan | U.K. Agreement Term Loan | U.K. Agreement Term Loan | U.K. Agreement Term Loan | U.K. Agreement Term Loan | U.K. Agreement Term Loan | UK Credit Agreement Overdraft Line of Credit | UK Credit Agreement Overdraft Line of Credit | UK Credit Agreement Overdraft Line of Credit | 5.75% senior subordinated notes due 2022 | 5.75% senior subordinated notes due 2022 | 5.75% senior subordinated notes due 2022 | 5.75% senior subordinated notes due 2022 | 5.75% senior subordinated notes due 2022 | Rental Car Revolver | Rental Car Revolver | Mortgage facilities | Mortgage facilities | Other Debt Securities | Other Debt Securities | US Credit Agreement Letters of Credit |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | GBP (£) | USD ($) | Minimum | Maximum | GBP (£) | USD ($) | USD ($) | GBP (£) | Minimum | Maximum | GBP (£) | USD ($) | USD ($) | USD ($) | USD ($) | Debt redemption prior to October 1, 2015 | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | |||||
Long Term Debt | ||||||||||||||||||||||||||||||||
Long-term Debt | $1,060,964 | $937,517 | $44,000 | $50,000 | $98,000 | $110,000 | $124,625 | £ 77,000 | $48,741 | £ 19,500 | $31,561 | $38,993 | $6,838 | $550,000 | $550,000 | $97,056 | $23,171 | $101,445 | $104,043 | $14,277 | $5,731 | |||||||||||
Less: current portion | -46,894 | -19,493 | ||||||||||||||||||||||||||||||
Net long-term debt | 1,014,070 | 918,024 | ||||||||||||||||||||||||||||||
Interest rate (as a percent) | 5.75% | 5.75% | 5.75% | |||||||||||||||||||||||||||||
Maximum credit available | 375,000 | 100,000 | 30,000 | 10,000 | 150,000 | 10,000 | ||||||||||||||||||||||||||
Base rate of interest on loans | LIBOR | LIBOR | LIBOR | LIBOR | Bank of England Base Rate | Bank of England Base Rate | three-month LIBOR | |||||||||||||||||||||||||
Line of credit basis spread on variable rate (as a percent) | 2.25% | 2.25% | 1.35% | 3.00% | 1.75% | 1.75% | 2.50% | |||||||||||||||||||||||||
Incremental interest rate for uncollateralized borrowings in excess of maximum limit (as a percent) | 1.25% | |||||||||||||||||||||||||||||||
Letters of credit outstanding | 18,197 | 0 | 0 | |||||||||||||||||||||||||||||
Balance outstanding under credit agreement | 44,000 | 98,000 | 97,056 | |||||||||||||||||||||||||||||
Repayment of debt | 12,000 | |||||||||||||||||||||||||||||||
Repayment of term loan, quarterly installments | 1,500 | |||||||||||||||||||||||||||||||
Frequency of principal repayments | Quarterly | |||||||||||||||||||||||||||||||
Final payment due December 31, 2015 | 7,500 | |||||||||||||||||||||||||||||||
Low end of interest rate, depending on UK subsidiaries ratios (as a percent) | 2.68% | |||||||||||||||||||||||||||||||
High end of interest rate, depending on UK subsidiaries ratios (as a percent) | 4.33% | |||||||||||||||||||||||||||||||
Debt issued | $550,000 | |||||||||||||||||||||||||||||||
Specified equity offerings, percentage of debt which may be redeemed | 40.00% | |||||||||||||||||||||||||||||||
Change of control, redemption price as a percentage of principal | 101.00% | |||||||||||||||||||||||||||||||
Sale of assets, redemption price as percentage of principal | 100.00% | |||||||||||||||||||||||||||||||
Domestic Subsidiaries ownership guaranteeing obligations (as a percent) | 100.00% |
Derivatives_and_Hedging_Detail
Derivatives and Hedging (Details) (USD $) | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Forward foreign exchange contracts | |
Fair Value, Inputs, Level 2 | Fair Value, Inputs, Level 2 | Floating Rate Floor Plan Debt | Floating Rate Floor Plan Debt | Floating Rate Floor Plan Debt | Floating Rate Floor Plan Debt | Fair Value, Inputs, Level 2 | |||
LIBOR portion | Fixed rate portion | ||||||||
Derivative | |||||||||
Portion of floating rate floor plan debt fixed by swap agreements | $300,000 | $100,000 | |||||||
Interest rate swap, fixed (as a percent) | 2.14% | 1.55% | |||||||
Estimated liabilities of swaps designated as hedging instruments, fair value | 9,379 | 14,337 | |||||||
Hedge ineffectiveness recorded | 0 | 0 | |||||||
Increase in the weighted average interest rate on floor plan borrowings due to the swaps (as a percent) | 0.35% | 0.36% | |||||||
Estimated asset of contracts designated as hedging instruments, fair value | $1,965 |
Commitments_and_Contingent_Lia1
Commitments and Contingent Liabilities (Details) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Commitments and Contingent Liabilities | |
Lease period, minimum | 5 years |
Lease period, maximum | 20 years |
Loss Contingencies | |
Letters of credit outstanding | $18,197 |
Surety bonds posted | 9,154 |
Holdings | Holdings Bond | |
Loss Contingencies | |
Senior unsecured notes issued | 700,000 |
Senior subordinated convertible notes, interest rate (as a percent) | 3.80% |
Penske Truck Leasing Co., L.P. | |
Loss Contingencies | |
Ownership interest in Penske Truck Leasing Co (as a percent) | 9.00% |
Funds Used to Reduce Outstanding Debt | 700,000 |
Penske Truck Leasing Co., L.P. | Holdings | |
Loss Contingencies | |
Subsidiary Contributed Capital | 700,000 |
Subsidiary of limited liability company or limited partnership ownership interest given in exchange of amount received percentage | 21.50% |
Guarantee of Indebtedness of Others | GECC | |
Loss Contingencies | |
Percentage of interest agreed to indemnify if GECC required to make any payments of principal or interest | 9.00% |
Annual fee pay for acting as co-obligor | 950 |
Value of interest payments included in maximum amount of Company's potential obligations | $63,100 |
Equity_Details
Equity (Details) (USD $) | 9 Months Ended |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 |
Stock Repurchase Period | |
Repurchase of common stock | $15,813 |
Board of Directors | |
Stock Repurchase Period | |
Repurchased shares | 410,000 |
Repurchase of common stock | 12,680 |
Repurchased shares, average price (in dollars per share) | $30.93 |
Employee Equity Awards | |
Stock Repurchase Period | |
Repurchased shares | 97,629 |
Repurchase of common stock | $3,135 |
Repurchased shares, average price (in dollars per share) | $32.11 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Income / (Loss) (Details) (USD $) | 3 Months Ended | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 |
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | ($41,505) | ($6,833) |
Other comprehensive income before reclassifications | 37,899 | 2,450 |
Amounts reclassified from accumulated other comprehensive income - net of tax | 552 | 1,329 |
Net current-period other comprehensive income | 38,451 | 3,779 |
Balance at the end of the period | -3,054 | -3,054 |
Interest Rate Swaps | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | -6,505 | -8,678 |
Other comprehensive income before reclassifications | 272 | 784 |
Amounts reclassified from accumulated other comprehensive income - net of tax | 552 | 2,213 |
Net current-period other comprehensive income | 824 | 2,997 |
Balance at the end of the period | -5,681 | -5,681 |
Interest Rate Swaps | Floor plan interest expense | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Amounts reclassified from accumulated other comprehensive income - net of tax | 552 | 2,213 |
Foreign Currency Translation | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | -36,825 | -1,194 |
Other comprehensive income before reclassifications | 41,811 | 7,064 |
Amounts reclassified from accumulated other comprehensive income - net of tax | -884 | |
Net current-period other comprehensive income | 41,811 | 6,180 |
Balance at the end of the period | 4,986 | 4,986 |
Foreign Currency Translation | Selling, general, and administrative expenses | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Amounts reclassified from accumulated other comprehensive income - net of tax | -884 | |
Other | ||
Changes in accumulated other comprehensive income (loss) by component | ||
Balance at the beginning of the period | 1,825 | 3,039 |
Other comprehensive income before reclassifications | -4,184 | -5,398 |
Net current-period other comprehensive income | -4,184 | -5,398 |
Balance at the end of the period | ($2,359) | ($2,359) |
Segment_Information_Details
Segment Information (Details) | 9 Months Ended |
Sep. 30, 2013 | |
item | |
Segment Information | |
Number of reportable Segments | 2 |
Number of geographic operating segments | 4 |
Segment_Information_Details_2
Segment Information (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues and adjusted segment income by reportable segment | ||||
Total revenues | $3,824,143 | $3,336,020 | $10,927,917 | $9,814,784 |
Segment income | 97,966 | 57,268 | 283,198 | 211,912 |
Operating segments | ||||
Revenues and adjusted segment income by reportable segment | ||||
Total revenues | 3,824,143 | 3,336,020 | 10,927,917 | 9,814,784 |
Segment income | 65,275 | 41,031 | 184,981 | 136,941 |
Operating segments | Retail | ||||
Revenues and adjusted segment income by reportable segment | ||||
Total revenues | 3,763,840 | 3,336,020 | 10,867,035 | 9,814,784 |
Segment income | 51,732 | 33,119 | 162,074 | 117,994 |
Operating segments | Other | ||||
Revenues and adjusted segment income by reportable segment | ||||
Total revenues | 66,050 | 88,026 | ||
Segment income | 13,485 | 7,912 | 23,178 | 18,947 |
Intersegment Elimination | ||||
Revenues and adjusted segment income by reportable segment | ||||
Total revenues | -5,747 | -27,144 | ||
Segment income | $58 | ($271) |
Consolidating_Condensed_Financ2
Consolidating Condensed Financial Information (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Condensed consolidating balance sheet | ||||
Cash and cash equivalents | $71,101 | $43,447 | $25,886 | $26,997 |
Accounts receivable, net | 588,311 | 554,851 | ||
Inventories | 2,293,390 | 2,000,206 | ||
Other current assets | 83,508 | 90,485 | ||
Assets held for sale | 1,065 | 71,107 | ||
Total current assets | 3,037,375 | 2,760,096 | ||
Property and equipment, net | 1,211,020 | 1,031,188 | ||
Intangible assets | 1,401,497 | 1,263,590 | ||
Equity method investments | 333,081 | 303,160 | ||
Other long-term assets | 27,831 | 20,956 | ||
Total assets | 6,010,804 | 5,378,990 | ||
Floor plan notes payable | 1,537,185 | 1,408,362 | ||
Floor plan notes payable - non-trade | 802,051 | 725,526 | ||
Accounts payable | 380,000 | 263,881 | ||
Accrued expenses | 275,483 | 223,972 | ||
Current portion of long-term debt | 46,894 | 19,493 | ||
Liabilities held for sale | 2,592 | 51,279 | ||
Total current liabilities | 3,044,205 | 2,692,513 | ||
Long-term debt | 1,014,070 | 918,024 | ||
Deferred tax liabilities | 338,430 | 287,818 | ||
Other long-term liabilities | 156,708 | 164,314 | ||
Total liabilities | 4,553,413 | 4,062,669 | ||
Total equity | 1,457,391 | 1,316,321 | ||
Total liabilities and equity | 6,010,804 | 5,378,990 | ||
5.75% Notes | ||||
Condensed consolidating balance sheet | ||||
Interest rate (as a percent) | 5.75% | 5.75% | 5.75% | |
Domestic Subsidiaries ownership guaranteeing obligations (as a percent) | 100.00% | |||
Penske Automotive Group | 5.75% Notes | ||||
Condensed consolidating balance sheet | ||||
Interest rate (as a percent) | 5.75% | 5.75% | ||
Guarantor Subsidiaries | ||||
Condensed consolidating balance sheet | ||||
Domestic Subsidiaries ownership guaranteeing obligations (as a percent) | 100.00% | |||
Reportable legal entities | Penske Automotive Group | ||||
Condensed consolidating balance sheet | ||||
Accounts receivable, net | 378,659 | 340,917 | ||
Other current assets | 2,955 | 3,546 | ||
Total current assets | 381,614 | 344,463 | ||
Property and equipment, net | 4,251 | 4,474 | ||
Equity method investments | 280,730 | 252,816 | ||
Other long-term assets | 1,613,941 | 1,540,447 | ||
Total assets | 2,280,536 | 2,142,200 | ||
Floor plan notes payable - non-trade | 128,100 | 112,085 | ||
Accounts payable | 2,841 | 3,344 | ||
Accrued expenses | 205 | 450 | ||
Total current liabilities | 131,146 | 115,879 | ||
Long-term debt | 692,000 | 710,000 | ||
Total liabilities | 823,146 | 825,879 | ||
Total equity | 1,457,390 | 1,316,321 | ||
Total liabilities and equity | 2,280,536 | 2,142,200 | ||
Reportable legal entities | Guarantor Subsidiaries | ||||
Condensed consolidating balance sheet | ||||
Cash and cash equivalents | 7,514 | 36,478 | 17,527 | 26,767 |
Accounts receivable, net | 292,806 | 375,442 | ||
Inventories | 1,300,592 | 1,212,521 | ||
Other current assets | 32,593 | 55,841 | ||
Assets held for sale | 165 | 28,716 | ||
Total current assets | 1,633,670 | 1,708,998 | ||
Property and equipment, net | 814,083 | 662,722 | ||
Intangible assets | 768,677 | 761,005 | ||
Other long-term assets | 5,232 | 5,029 | ||
Total assets | 3,221,662 | 3,137,754 | ||
Floor plan notes payable | 884,700 | 917,391 | ||
Floor plan notes payable - non-trade | 375,983 | 346,683 | ||
Accounts payable | 128,236 | 124,663 | ||
Accrued expenses | 142,530 | 114,636 | ||
Current portion of long-term debt | 36,236 | 9,745 | ||
Liabilities held for sale | 383 | 17,766 | ||
Total current liabilities | 1,568,068 | 1,530,884 | ||
Long-term debt | 166,262 | 121,618 | ||
Deferred tax liabilities | 313,342 | 260,445 | ||
Other long-term liabilities | 77,865 | 85,151 | ||
Total liabilities | 2,125,537 | 1,998,098 | ||
Total equity | 1,096,125 | 1,139,656 | ||
Total liabilities and equity | 3,221,662 | 3,137,754 | ||
Reportable legal entities | Non-Guarantor Subsidiaries | ||||
Condensed consolidating balance sheet | ||||
Cash and cash equivalents | 63,587 | 6,969 | 8,359 | 230 |
Accounts receivable, net | 295,505 | 179,409 | ||
Inventories | 992,798 | 787,685 | ||
Other current assets | 47,960 | 31,098 | ||
Assets held for sale | 900 | 42,391 | ||
Total current assets | 1,400,750 | 1,047,552 | ||
Property and equipment, net | 392,686 | 363,992 | ||
Intangible assets | 632,820 | 502,585 | ||
Equity method investments | 52,351 | 50,344 | ||
Other long-term assets | 11,322 | 2,636 | ||
Total assets | 2,489,929 | 1,967,109 | ||
Floor plan notes payable | 652,485 | 490,971 | ||
Floor plan notes payable - non-trade | 297,968 | 266,758 | ||
Accounts payable | 248,923 | 135,874 | ||
Accrued expenses | 511,407 | 449,803 | ||
Current portion of long-term debt | 10,658 | 9,748 | ||
Liabilities held for sale | 2,209 | 33,513 | ||
Total current liabilities | 1,723,650 | 1,386,667 | ||
Long-term debt | 252,280 | 125,098 | ||
Deferred tax liabilities | 25,088 | 27,373 | ||
Other long-term liabilities | 78,843 | 79,163 | ||
Total liabilities | 2,079,861 | 1,618,301 | ||
Total equity | 410,068 | 348,808 | ||
Total liabilities and equity | 2,489,929 | 1,967,109 | ||
Eliminations | ||||
Condensed consolidating balance sheet | ||||
Accounts receivable, net | -378,659 | -340,917 | ||
Total current assets | -378,659 | -340,917 | ||
Other long-term assets | -1,602,664 | -1,527,156 | ||
Total assets | -1,981,323 | -1,868,073 | ||
Accrued expenses | -378,659 | -340,917 | ||
Total current liabilities | -378,659 | -340,917 | ||
Long-term debt | -96,472 | -38,692 | ||
Total liabilities | -475,131 | -379,609 | ||
Total equity | -1,506,192 | -1,488,464 | ||
Total liabilities and equity | ($1,981,323) | ($1,868,073) |
Consolidating_Condensed_Financ3
Consolidating Condensed Financial Information (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Condensed consolidating statement of income | ||||
Revenues | $3,824,143 | $3,336,020 | $10,927,917 | $9,814,784 |
Cost of sales | 3,244,235 | 2,834,536 | 9,244,779 | 8,313,365 |
Gross profit | 579,908 | 501,484 | 1,683,138 | 1,501,419 |
Selling, general and administrative expenses | 454,188 | 400,039 | 1,308,958 | 1,188,658 |
Depreciation | 15,784 | 13,704 | 45,300 | 40,014 |
Operating Income (Loss) | 109,936 | 87,741 | 328,880 | 272,747 |
Floor plan interest expense | -10,840 | -9,951 | -32,008 | -29,319 |
Other interest expense | -12,370 | -11,583 | -36,163 | -35,155 |
Equity in earnings of affiliates | 11,240 | 8,814 | 22,489 | 21,392 |
Debt redemption costs | -17,753 | -17,753 | ||
Income from continuing operations before income taxes | 97,966 | 57,268 | 283,198 | 211,912 |
Income taxes | -31,692 | -15,421 | -95,263 | -69,347 |
Income from continuing operations | 66,274 | 41,847 | 187,935 | 142,565 |
Income (loss) from discontinued operations, net of tax | -742 | -534 | -1,889 | -4,634 |
Net income (loss) | 65,532 | 41,313 | 186,046 | 137,931 |
Other Comprehensive Income (Loss), Net of Taxes | 38,449 | 17,948 | 4,313 | 17,758 |
Comprehensive Income | 103,981 | 59,261 | 190,359 | 155,689 |
Less: Comprehensive income attributable to the non-controlling interests | 257 | 489 | 1,599 | 1,197 |
Comprehensive income attributable to Penske Automotive Group common stockholders | 103,724 | 58,772 | 188,760 | 154,492 |
Reportable legal entities | Penske Automotive Group | ||||
Condensed consolidating statement of income | ||||
Selling, general and administrative expenses | 5,475 | 5,073 | 15,328 | 14,408 |
Depreciation | 417 | 328 | 1,206 | 936 |
Operating Income (Loss) | -5,892 | -5,401 | -16,534 | -15,344 |
Floor plan interest expense | -2,428 | -2,322 | -7,174 | -6,774 |
Other interest expense | -7,159 | -7,695 | -20,555 | -21,986 |
Equity in earnings of affiliates | 10,035 | 7,784 | 18,865 | 18,538 |
Equity in earnings of subsidiaries | 103,153 | 82,373 | 307,531 | 254,241 |
Debt redemption costs | -17,753 | -17,753 | ||
Income from continuing operations before income taxes | 97,709 | 56,986 | 282,133 | 210,922 |
Income taxes | -31,692 | -15,421 | -95,263 | -69,347 |
Income from continuing operations | 66,017 | 41,565 | 186,870 | 141,575 |
Income (loss) from discontinued operations, net of tax | -742 | -534 | -1,889 | -4,634 |
Net income (loss) | 65,275 | 41,031 | 184,981 | 136,941 |
Other Comprehensive Income (Loss), Net of Taxes | 38,449 | 17,948 | 4,313 | 17,758 |
Comprehensive Income | 103,724 | 58,979 | 189,294 | 154,699 |
Less: Comprehensive income attributable to the non-controlling interests | 207 | 534 | 207 | |
Comprehensive income attributable to Penske Automotive Group common stockholders | 103,724 | 58,772 | 188,760 | 154,492 |
Reportable legal entities | Guarantor Subsidiaries | ||||
Condensed consolidating statement of income | ||||
Revenues | 2,296,224 | 1,997,423 | 6,616,079 | 5,821,934 |
Cost of sales | 1,933,197 | 1,687,417 | 5,545,896 | 4,897,098 |
Gross profit | 363,027 | 310,006 | 1,070,183 | 924,836 |
Selling, general and administrative expenses | 280,222 | 244,259 | 820,249 | 728,842 |
Depreciation | 9,538 | 7,580 | 26,743 | 22,018 |
Operating Income (Loss) | 73,267 | 58,167 | 223,191 | 173,976 |
Floor plan interest expense | -4,951 | -4,300 | -15,044 | -12,247 |
Other interest expense | -1,951 | -804 | -4,214 | -2,668 |
Income from continuing operations before income taxes | 66,365 | 53,063 | 203,933 | 159,061 |
Income taxes | -24,116 | -14,733 | -77,745 | -59,519 |
Income from continuing operations | 42,249 | 38,330 | 126,188 | 99,542 |
Income (loss) from discontinued operations, net of tax | -151 | 219 | -184 | -1,830 |
Net income (loss) | 42,098 | 38,549 | 126,004 | 97,712 |
Other Comprehensive Income (Loss), Net of Taxes | 824 | 175 | 2,997 | -74 |
Comprehensive Income | 42,922 | 38,724 | 129,001 | 97,638 |
Comprehensive income attributable to Penske Automotive Group common stockholders | 42,922 | 38,724 | 129,001 | 97,638 |
Reportable legal entities | Non-Guarantor Subsidiaries | ||||
Condensed consolidating statement of income | ||||
Revenues | 1,527,919 | 1,338,597 | 4,311,838 | 3,992,850 |
Cost of sales | 1,311,038 | 1,147,119 | 3,698,883 | 3,416,267 |
Gross profit | 216,881 | 191,478 | 612,955 | 576,583 |
Selling, general and administrative expenses | 168,491 | 150,707 | 473,381 | 445,408 |
Depreciation | 5,829 | 5,796 | 17,351 | 17,060 |
Operating Income (Loss) | 42,561 | 34,975 | 122,223 | 114,115 |
Floor plan interest expense | -3,461 | -3,329 | -9,790 | -10,298 |
Other interest expense | -3,260 | -3,084 | -11,394 | -10,501 |
Equity in earnings of affiliates | 1,205 | 1,030 | 3,624 | 2,854 |
Income from continuing operations before income taxes | 37,045 | 29,592 | 104,663 | 96,170 |
Income taxes | -9,342 | -7,559 | -26,094 | -24,084 |
Income from continuing operations | 27,703 | 22,033 | 78,569 | 72,086 |
Income (loss) from discontinued operations, net of tax | -591 | -753 | -1,705 | -2,804 |
Net income (loss) | 27,112 | 21,280 | 76,864 | 69,282 |
Other Comprehensive Income (Loss), Net of Taxes | 37,798 | 16,707 | 1,519 | 15,224 |
Comprehensive Income | 64,910 | 37,987 | 78,383 | 84,506 |
Less: Comprehensive income attributable to the non-controlling interests | 257 | 489 | 1,599 | 1,197 |
Comprehensive income attributable to Penske Automotive Group common stockholders | 64,653 | 37,498 | 76,784 | 83,309 |
Eliminations | ||||
Condensed consolidating statement of income | ||||
Equity in earnings of subsidiaries | -103,153 | -82,373 | -307,531 | -254,241 |
Income from continuing operations before income taxes | -103,153 | -82,373 | -307,531 | -254,241 |
Income taxes | 33,458 | 22,292 | 103,839 | 83,603 |
Income from continuing operations | -69,695 | -60,081 | -203,692 | -170,638 |
Income (loss) from discontinued operations, net of tax | 742 | 534 | 1,889 | 4,634 |
Net income (loss) | -68,953 | -59,547 | -201,803 | -166,004 |
Other Comprehensive Income (Loss), Net of Taxes | -38,622 | -16,882 | -4,516 | -15,150 |
Comprehensive Income | -107,575 | -76,429 | -206,319 | -181,154 |
Less: Comprehensive income attributable to the non-controlling interests | -207 | -534 | -207 | |
Comprehensive income attributable to Penske Automotive Group common stockholders | ($107,575) | ($76,222) | ($205,785) | ($180,947) |
Consolidating_Condensed_Financ4
Consolidating Condensed Financial Information (Details 3) (USD $) | 9 Months Ended | 9 Months Ended | |||||||||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
3.5% Notes | 5.75% Notes | 5.75% Notes | 5.75% Notes | 7.75% Notes | Penske Automotive Group | Penske Automotive Group | Reportable legal entities | Reportable legal entities | Reportable legal entities | Reportable legal entities | Reportable legal entities | Reportable legal entities | |||
5.75% Notes | 5.75% Notes | Penske Automotive Group | Penske Automotive Group | Guarantor Subsidiaries | Guarantor Subsidiaries | Non-Guarantor Subsidiaries | Non-Guarantor Subsidiaries | ||||||||
Condensed consolidating statement of cash flows | |||||||||||||||
Net cash from continuing operating activities | $297,997 | $262,748 | $59,444 | $95,748 | $56,502 | $40,064 | $182,051 | $126,936 | |||||||
Investing activities: | |||||||||||||||
Purchase of equipment and improvements | -122,952 | -96,380 | -983 | -766 | -84,506 | -67,233 | -37,463 | -28,381 | |||||||
Purchase of Penske Car Rental vehicles | -82,313 | -82,313 | |||||||||||||
Proceeds from sale-leaseback transactions | 1,584 | 1,584 | |||||||||||||
Acquisitions, net | -221,160 | -137,805 | -22,005 | -3,416 | -199,155 | -134,389 | |||||||||
Other | -7,493 | 3,496 | -3,812 | -7,522 | 29 | 7,308 | |||||||||
Net cash from continuing investing activities | -433,918 | -229,105 | -983 | -4,578 | -196,346 | -70,649 | -236,589 | -153,878 | |||||||
Financing activities: | |||||||||||||||
Repurchase of 3.5% senior subordinated convertible notes | -62,687 | -62,687 | |||||||||||||
Issuance of 5.75% senior subordinated notes | 550,000 | 550,000 | |||||||||||||
Repurchase of 7.75% senior subordinated notes | -390,755 | -390,755 | |||||||||||||
Net borrowings (repayments) of long-term debt | 123,825 | -133,913 | -18,000 | -149,000 | 71,147 | -1,598 | 70,678 | 16,685 | |||||||
Net borrowings (repayments) of floor plan notes payable - non-trade | 76,525 | 32,410 | 16,015 | 9,363 | 29,300 | 11,471 | 31,210 | 11,576 | |||||||
Repurchases of common stock | -15,813 | -9,829 | -15,813 | -9,829 | |||||||||||
Dividends | -40,663 | -29,760 | -40,663 | -29,760 | |||||||||||
Payment of deferred financing fees | -8,502 | -8,502 | |||||||||||||
Distributions from (to) parent | 1,154 | 4,747 | -1,154 | -4,747 | |||||||||||
Other | 235 | 235 | |||||||||||||
Net cash from continuing financing activities | 144,109 | -53,036 | -58,461 | -91,170 | 101,601 | 14,620 | 100,969 | 23,514 | |||||||
Net cash from discontinued operations | 19,466 | 18,282 | 9,279 | 6,725 | 10,187 | 11,557 | |||||||||
Net change in cash and cash equivalents | 27,654 | -1,111 | -28,964 | -9,240 | 56,618 | 8,129 | |||||||||
Cash and cash equivalents, beginning of period | 43,447 | 26,997 | 36,478 | 26,767 | 6,969 | 230 | |||||||||
Cash and cash equivalents, end of period | $71,101 | $25,886 | $7,514 | $17,527 | $63,587 | $8,359 | |||||||||
Interest rate (as a percent) | 3.50% | 5.75% | 5.75% | 5.75% | 7.75% | 5.75% | 5.75% |