Document And Entity Information
Document And Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 26, 2016 | Jun. 30, 2015 | |
Common Class A [Member] | |||
Entity Common Stock, Shares Outstanding (in shares) | 23,176,372 | ||
Common Class B [Member] | |||
Entity Common Stock, Shares Outstanding (in shares) | 2,542,231 | ||
Entity Registrant Name | LITHIA MOTORS INC | ||
Entity Central Index Key | 1,023,128 | ||
Trading Symbol | lad | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Public Float | $ 2,686,645 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 | ||
Common Class A [Member] | ||||
Stockholders' Equity: | ||||
Common stock | $ 258,410,000 | $ 276,058,000 | ||
Common Class B [Member] | ||||
Stockholders' Equity: | ||||
Common stock | 316,000 | 319,000 | ||
Cash and cash equivalents | 45,008,000 | 29,898,000 | ||
Accounts receivable, net of allowance for doubtful accounts of $2,243 and $2,904 | 308,462,000 | 295,379,000 | ||
Inventories, net | 1,470,987,000 | 1,249,659,000 | ||
Other current assets | $ 54,408,000 | 32,010,000 | ||
Assets held for sale | 8,563,000 | |||
Total Current Assets | $ 1,878,865,000 | 1,615,509,000 | ||
Property and equipment, net of accumulated depreciation of $137,853 and $117,679 | 876,660,000 | 816,745,000 | ||
Goodwill | [1] | 213,220,000 | 199,375,000 | |
Franchise value | 157,699,000 | 150,892,000 | ||
Other non-current assets | 100,855,000 | 98,411,000 | ||
Total Assets | 3,227,299,000 | 2,880,932,000 | ||
Floor Plan Notes Payable | 48,083,000 | 41,047,000 | [2] | |
Floor plan notes payable: non-trade | 1,265,872,000 | 1,137,632,000 | ||
Current maturities of long-term debt | 38,891,000 | 31,912,000 | ||
Trade payables | 70,871,000 | 70,853,000 | ||
Accrued liabilities | $ 167,108,000 | 153,661,000 | ||
Deferred income taxes | 2,603,000 | |||
Liabilities related to assets held for sale | 4,892,000 | |||
Total Current Liabilities | $ 1,590,825,000 | 1,442,600,000 | ||
Long-term debt, less current maturities | 606,463,000 | 609,066,000 | ||
Deferred revenue | 66,734,000 | 54,403,000 | ||
Deferred income taxes | 53,129,000 | 42,795,000 | ||
Other long-term liabilities | 81,984,000 | 58,963,000 | ||
Total Liabilities | 2,399,135,000 | 2,207,827,000 | ||
Preferred stock - no par value; authorized 15,000 shares; none outstanding | 0 | 0 | ||
Additional paid-in capital | 38,822,000 | 29,775,000 | ||
Accumulated other comprehensive loss | (277,000) | (926,000) | ||
Retained earnings | 530,893,000 | 367,879,000 | ||
Total Stockholders' Equity | 828,164,000 | 673,105,000 | ||
Total Liabilities and Stockholders' Equity | $ 3,227,299,000 | $ 2,880,932,000 | ||
[1] | Net of accumulated impairment losses of $299.3 million recorded during the year ended December 31, 2008. | |||
[2] | At December 31, 2014, we had an additional $4.9 million of floor plan notes payable outstanding on our new vehicle floor plan commitment recorded as liability related to assets held for sale. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Common Class A [Member] | ||
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 23,676,000 | 23,671,000 |
Common stock, shares outstanding (in shares) | 23,676,000 | 23,671,000 |
Common Class B [Member] | ||
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Common stock, shares issued (in shares) | 2,542,000 | 2,562,000 |
Common stock, shares outstanding (in shares) | 2,542,000 | 2,562,000 |
Allowance for doubtful accounts | $ 2,243 | $ 2,904 |
Accumulated depreciation | $ 137,853 | $ 117,679 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 15,000,000 | 15,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
New Vehicle [Member] | ||||
Revenues: | ||||
Revenues | $ 4,552,301 | $ 3,077,670 | $ 2,256,598 | |
Cost of sales: | ||||
Cost of sales | 4,271,931 | 2,879,486 | 2,105,480 | |
Used Retail Vehicle [Member] | ||||
Revenues: | ||||
Revenues | 1,927,016 | 1,362,481 | 1,032,224 | |
Cost of sales: | ||||
Cost of sales | 1,685,767 | 1,183,228 | 881,366 | |
Used Wholesale Vehicle [Member] | ||||
Revenues: | ||||
Revenues | 261,530 | 195,699 | 158,235 | |
Cost of sales: | ||||
Cost of sales | 257,073 | 192,053 | 155,524 | |
Finance and Insurance [Member] | ||||
Revenues: | ||||
Revenues | 283,018 | 190,381 | 139,007 | |
Service, Body and Parts [Member] | ||||
Revenues: | ||||
Revenues | 738,990 | 512,124 | 383,483 | |
Cost of sales: | ||||
Cost of sales | 375,069 | 262,388 | 197,913 | |
Fleet and Other [Member] | ||||
Revenues: | ||||
Revenues | 101,397 | 51,971 | 36,202 | |
Cost of sales: | ||||
Cost of sales | 98,778 | 49,849 | 34,513 | |
Revenues | 7,864,252 | 5,390,326 | 4,005,749 | |
Cost of sales | 6,688,618 | 4,567,004 | 3,374,796 | |
Gross profit | 1,175,634 | 823,322 | $ 630,953 | |
Asset impairments | 20,124 | 1,853 | ||
Selling, general and administrative | 811,175 | 563,207 | $ 427,400 | |
Depreciation and amortization | 41,600 | 26,363 | 20,035 | |
Operating income | 302,735 | 231,899 | 183,518 | |
Floor plan interest expense | (19,534) | (13,861) | (12,373) | |
Other interest expense | (19,491) | (10,742) | (8,350) | |
Other (expense) income, net | (1,006) | 3,199 | 2,993 | |
Income from continuing operations before income taxes | [1] | 262,704 | 210,495 | 165,788 |
Income tax provision | (79,705) | (74,955) | (60,574) | |
Income from continuing operations, net of income tax | $ 182,999 | 135,540 | 105,214 | |
Income from discontinued operations, net of income tax expense | 3,180 | 786 | ||
Net income | $ 182,999 | $ 138,720 | $ 106,000 | |
Basic income per share from continuing operations (in dollars per share) | $ 6.96 | $ 5.19 | $ 4.08 | |
Basic income per share from discontinued operations (in dollars per share) | 0.12 | 0.03 | ||
Basic net income per share (in dollars per share) | $ 6.96 | $ 5.31 | $ 4.11 | |
Shares used in basic per share calculations (in shares) | 26,290 | 26,121 | 25,805 | |
Diluted income per share from continuing operations (in dollars per share) | $ 6.91 | $ 5.14 | $ 4.02 | |
Diluted income per share from discontinued operations (in dollars per share) | 0.12 | 0.03 | ||
Diluted net income per share (in dollars per share) | $ 6.91 | $ 5.26 | $ 4.05 | |
Shares used in diluted per share calculations (in shares) | 26,490 | 26,382 | 26,191 | |
[1] | Segment income for each of the segments is defined as Income from continuing operations before income taxes, depreciation and amortization, other interest expense and other (expense) income, net. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net income | $ 182,999 | $ 138,720 | $ 106,000 |
Other comprehensive income, net of tax: | |||
Gain on cash flow hedges, net of tax expense of $399, $380 and $668 | 649 | 612 | 1,077 |
Comprehensive income | $ 183,648 | $ 139,332 | $ 107,077 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parentheticals) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Gain on cash flow hedges, tax expense | $ 399 | $ 380 | $ 668 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) | Common Stock [Member]Common Class A [Member] | Common Stock [Member]Common Class B [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Common Class A [Member] | Total |
Balance, shares (in shares) at Dec. 31, 2012 | 22,916,000 | 2,762,000 | |||||
Balance at Dec. 31, 2012 | $ 268,801,000 | $ 343,000 | $ 12,399,000 | $ (2,615,000) | $ 149,173,000 | $ 428,101,000 | |
Net income | 106,000,000 | 106,000,000 | |||||
Gain on cash flow hedges, net of tax expense of | 1,077,000 | 1,077,000 | |||||
Issuance of stock in connection with employee stock plans (in shares) | 283,000 | ||||||
Issuance of stock in connection with employee stock plans | $ 5,149,000 | 5,149,000 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 117,000 | ||||||
Repurchase of Class A common stock (in shares) | (187,000) | (127,900) | |||||
Repurchase of Class A common stock | $ (7,903,000) | (7,903,000) | |||||
Class B common stock converted to Class A common stock (in shares) | 200,000 | (200,000) | |||||
Class B common stock converted to Class A common stock | $ 24,000 | $ (24,000) | |||||
Compensation for stock and stock option issuances and excess tax benefits from option exercises | $ 2,184,000 | 10,199,000 | 12,383,000 | ||||
Dividends paid | (10,085,000) | (10,085,000) | |||||
Balance, shares (in shares) at Dec. 31, 2013 | 23,329,000 | 2,562,000 | |||||
Balance at Dec. 31, 2013 | $ 268,255,000 | $ 319,000 | 22,598,000 | (1,538,000) | 245,088,000 | $ 534,722,000 | |
Issuance of stock in connection with acquisitions | |||||||
Net income | 138,720,000 | $ 138,720,000 | |||||
Gain on cash flow hedges, net of tax expense of | 612,000 | 612,000 | |||||
Issuance of stock in connection with employee stock plans (in shares) | 118,000 | ||||||
Issuance of stock in connection with employee stock plans | $ 4,590,000 | 4,590,000 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 288,000 | ||||||
Repurchase of Class A common stock (in shares) | (333,000) | (226,729) | |||||
Repurchase of Class A common stock | $ (22,968,000) | (22,968,000) | |||||
Compensation for stock and stock option issuances and excess tax benefits from option exercises | $ 6,445,000 | 7,177,000 | 13,622,000 | ||||
Dividends paid | (15,929,000) | (15,929,000) | |||||
Balance, shares (in shares) at Dec. 31, 2014 | 23,671,000 | 2,562,000 | |||||
Balance at Dec. 31, 2014 | $ 276,058,000 | $ 319,000 | 29,775,000 | (926,000) | 367,879,000 | 673,105,000 | |
Issuance of stock in connection with acquisitions (in shares) | 269,000 | ||||||
Issuance of stock in connection with acquisitions | $ 19,736,000 | 19,736,000 | |||||
Net income | 182,999,000 | 182,999,000 | |||||
Gain on cash flow hedges, net of tax expense of | 649,000 | 649,000 | |||||
Issuance of stock in connection with employee stock plans (in shares) | 74,000 | ||||||
Issuance of stock in connection with employee stock plans | $ 6,065,000 | 6,065,000 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 217,000 | ||||||
Repurchase of Class A common stock (in shares) | (306,000) | (228,737) | |||||
Repurchase of Class A common stock | $ (31,548,000) | (31,548,000) | |||||
Class B common stock converted to Class A common stock (in shares) | 20,000 | (20,000) | |||||
Class B common stock converted to Class A common stock | $ 3,000 | $ (3,000) | |||||
Compensation for stock and stock option issuances and excess tax benefits from option exercises | $ 7,832,000 | 9,047,000 | 16,879,000 | ||||
Dividends paid | (19,985,000) | (19,985,000) | |||||
Balance, shares (in shares) at Dec. 31, 2015 | 23,676,000 | 2,542,000 | |||||
Balance at Dec. 31, 2015 | $ 258,410,000 | $ 316,000 | $ 38,822,000 | $ (277,000) | $ 530,893,000 | $ 828,164,000 | |
Issuance of stock in connection with acquisitions |
Consolidated Statements of Cha8
Consolidated Statements of Changes in Stockholders' Equity (Parentheticals) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
AOCI Attributable to Parent [Member] | |||
Gain on cash flow hedges, net of tax expense | $ 399 | $ 380 | $ 668 |
Gain on cash flow hedges, net of tax expense | $ 399 | $ 380 | $ 668 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Continuing Operations [Member] | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | $ 41,600 | $ 26,363 | $ 20,035 |
Deferred income taxes | 6,725 | 10,669 | 8,308 |
Scheduled Payments [Member] | |||
Cash flows from financing activities: | |||
Principal payments on long-term debt, scheduled | (15,074) | $ (8,666) | (7,100) |
Other Payments [Member] | |||
Cash flows from financing activities: | |||
Principal payments on long-term debt, scheduled | (9,189) | (25,770) | |
Common Class A [Member] | |||
Cash flows from financing activities: | |||
Excess tax benefit from share-based payment arrangements | 5,012 | $ 6,186 | 5,994 |
Net income | 182,999 | 138,720 | $ 106,000 |
Asset impairments | 20,124 | 1,853 | |
Stock-based compensation | 11,871 | 7,436 | $ 6,565 |
(Gain) loss on disposal of other assets | 203 | 271 | $ (2,339) |
Gain from disposal activities | (5,919) | (5,744) | |
Deferred income taxes | 12,341 | 13,355 | $ 14,477 |
Excess tax benefit from share-based payment arrangements | (5,012) | (6,186) | (5,994) |
Trade receivables, net | (13,047) | (59,474) | (37,370) |
Inventories | (197,079) | (76,002) | (106,896) |
Other assets | (31,620) | (31,182) | (5,655) |
Floor plan notes payable | 7,035 | (647) | 5,300 |
Trade payables | 674 | (3,105) | 8,480 |
Accrued liabilities | 16,273 | (13,472) | 12,304 |
Other long-term liabilities and deferred revenue | 33,766 | 38,133 | 17,152 |
Net cash provided by operating activities | $ 74,209 | 30,319 | 32,059 |
Principal payments received on notes receivable | 2,882 | 91 | |
Capital expenditures | $ (83,244) | (85,983) | (50,025) |
Proceeds from sales of assets | 270 | 4,896 | 4,632 |
Cash paid for other investments | (28,110) | (9,110) | (3,915) |
Cash paid for acquisitions, net of cash acquired | (71,615) | (659,634) | $ (81,105) |
Proceeds from sales of stores | 12,966 | 10,617 | |
Net cash used in investing activities | (169,733) | (736,332) | $ (130,322) |
Borrowings on floor plan notes payable: non-trade, net | 136,201 | 440,341 | 128,636 |
Borrowings on lines of credit | 1,261,597 | 1,435,144 | 800,000 |
Repayments on lines of credit | (1,298,120) | (1,251,375) | (814,355) |
Proceeds from issuance of long-term debt | 75,675 | 124,902 | 4,720 |
Proceeds from issuance of common stock | 6,065 | 4,590 | 4,973 |
Repurchase of common stock | (31,548) | (22,968) | (7,903) |
Dividends paid | (19,985) | (15,929) | (10,085) |
Net cash provided by financing activities | 110,634 | 712,225 | 79,110 |
Increase (decrease) in cash and cash equivalents | 15,110 | 6,212 | (19,153) |
Cash and cash equivalents at beginning of year | 29,898 | 23,686 | 42,839 |
Cash and cash equivalents at end of year | 45,008 | 29,898 | 23,686 |
Supplemental disclosure of cash flow information: | |||
Cash paid during the period for interest | 41,098 | 24,638 | 21,002 |
Cash paid during the period for income taxes, net | 86,533 | 63,827 | $ 42,682 |
Supplemental schedule of non-cash activities: | |||
Debt issued or acquired in connection with acquisitions | 2,160 | $ 55,693 | |
Debt forgiven in connection with acquisitions | $ 1,374 | ||
Floor plan debt acquired in connection with acquisitions | $ 24,686 | ||
Floor plan debt paid in connection with store disposals | $ 4,400 | 3,311 | |
Issuance of Class A common stock in connection with acquisitions | $ 19,736 |
Note 1 - Summary of Significant
Note 1 - Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Significant Accounting Policies [Text Block] | (1) Summary of Significant Accounting Policies Organization and Business We are a leading operator of automotive franchises and a retailer of new and used vehicles and related services. As of December 31, 2015, we offered 31 brands of new vehicles and all brands of used vehicles in 137 stores in the United States and online at Lithia.com and DCHauto.com . We sell new and used cars and replacement parts; provide vehicle maintenance, warranty, paint and repair services; arrange related financing; and sell service contracts, vehicle protection products and credit insurance. Our dealerships are located across the United States. We seek domestic, import and luxury franchises in cities ranging from mid-sized regional markets to metropolitan markets. We evaluate all brands for expansion opportunities provided the market is large enough to support adequate new vehicle sales to justify the required capital investment. Basis of Presentation The accompanying Consolidated Financial Statements reflect the results of operations, the financial position and the cash flows for Lithia Motors, Inc. and its directly and indirectly wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Cash and Cash Equivalents Cash and cash equivalents are defined as cash on hand and cash in bank accounts without restrictions. Accounts Receivable Accounts receivable include amounts due from the following: • various lenders for the financing of vehicles sold; • customers for vehicles sold and service and parts sales; • manufacturers for factory rebates, dealer incentives and warranty reimbursement; and • insurance companies and other miscellaneous receivables. Receivables are recorded at invoice and do not bear interest until they are 60 days past due. The allowance for doubtful accounts represents an estimate of the amount of net losses inherent in our portfolio of accounts receivable as of the reporting date. We estimate an allowance for doubtful accounts based on our historical write-off experience and consider recent delinquency trends and recovery rates. Account balances are charged against the allowance after all appropriate means of collection have been exhausted and the potential for recovery is considered remote. The annual activity for charges and subsequent recoveries is immaterial. See Note 2. Inventories Inventories are valued at the lower of market value or cost, using a pooled approach for vehicles and the specific identification method for parts. Certain acquired inventories are valued using the last-in first-out (LIFO) method. The LIFO reserve associated with this inventory as of December 31, 2015 and 2014 was immaterial. The cost of new and used vehicle inventories includes the cost of any equipment added, reconditioning and transportation. Manufacturers reimburse us for holdbacks, floor plan interest assistance and advertising assistance, which are reflected as a reduction in the carrying value of each vehicle purchased. We recognize advertising assistance, floor plan interest assistance, holdbacks, cash incentives and other rebates received from manufacturers that are tied to specific vehicles as a reduction to cost of sales as the related vehicles are sold. Parts are valued at lower of market value or cost using a specific identification method. Parts purchase discounts that we receive from the manufacturer are reflected as a reduction in the carrying value of the parts purchased from the manufacturer and are recognized as a reduction to cost of goods sold as the related inventory is sold. See Note 3. Property and Equipment Property and equipment are stated at cost and depreciated over their estimated useful lives on the straight-line basis. Leasehold improvements made at the inception of the lease or during the term of the lease are amortized on a straight-line basis over the shorter of the life of the improvement or the remaining term of the lease. The range of estimated useful lives is as follows: Buildings and improvements (in years) 5 to 40 Service equipment (in years) 5 to 15 Furniture, office equipment, signs and fixtures (in years) 3 to 10 The cost for maintenance, repairs and minor renewals is expensed as incurred, while significant remodels and betterments are capitalized. In addition, interest on borrowings for major capital projects, significant remodels and betterments are capitalized. Capitalized interest becomes a part of the cost of the depreciable asset and is depreciated according to the estimated useful lives as previously stated. For the years ended December 31, 2015, 2014 and 2013, we recorded capitalized interest of $0.5 million, $0.4 million and $0.1 million, respectively. When an asset is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts, and any gain or loss is credited or charged to income from continuing operations. Leased property meeting certain criteria is capitalized and the present value of the related lease payments is recorded as a liability. Amortization of capitalized leased assets is computed on a straight-line basis over the term of the lease, unless the lease transfers title or it contains a bargain purchase option, in which case, it is amortized over the asset’s useful life, and is included in depreciation expense. Long-lived assets held and used by us are reviewed for impairment whenever events or circumstances indicate that the carrying amount of assets may not be recoverable. We consider several factors when evaluating whether there are indications of potential impairment related to our long-lived assets, including store profitability, overall macroeconomic factors and the impact of our strategic management decisions. If recoverability testing is performed, we evaluate assets to be held and used by comparing the carrying amount of an asset to future net undiscounted cash flows associated with the asset, including its disposition. If such assets are considered to be impaired, the amount by which the carrying amount of the assets exceeds the fair value of the assets is recognized as a charge to income from continuing operations. See Note 4. Franchise Value We enter into agreements (“Franchise Agreements”) with the manufacturers. Franchise value represents a right received under Franchise Agreements with manufacturers and is identified on an individual store basis. We evaluated the useful lives of our Franchise Agreements based on the following factors: • certain of our Franchise Agreements continue indefinitely by their terms; • certain of our Franchise Agreements have limited terms, but are routinely renewed without substantial cost to us; • other than franchise terminations related to the unprecedented reorganizations of Chrysler and General Motors, and allowed by bankruptcy law, we are not aware of manufacturers terminating Franchise Agreements against the wishes of the franchise owners in the ordinary course of business. A manufacturer may pressure a franchise owner to sell a franchise when the owner is in breach of the franchise agreement over an extended period of time; • state dealership franchise laws typically limit the rights of the manufacturer to terminate or not renew a franchise; • we are not aware of any legislation or other factors that would materially change the retail automotive franchise system; and • as evidenced by our acquisition and disposition history, there is an active market for most automotive dealership franchises within the United States. We attribute value to the Franchise Agreements acquired with the dealerships we purchase based on the understanding and industry practice that the Franchise Agreements will be renewed indefinitely by the manufacturer. Accordingly, we have determined that our Franchise Agreements will continue to contribute to our cash flows indefinitely and, therefore, have indefinite lives. As an indefinite-lived intangible asset, franchise value is tested for impairment at least annually, and more frequently if events or circumstances indicate the carrying value may exceed fair value. The impairment test for indefinite-lived intangible assets requires the comparison of estimated fair value to carrying value. An impairment charge is recorded to the extent the fair value is less than the carrying value. We have the option to qualitatively or quantitatively assess indefinite-lived intangible assets for impairment. We evaluated our indefinite-lived intangible assets using a quantitative assessment process. We have determined the appropriate reporting unit for testing franchise value for impairment is each individual store. We test our franchise value for impairment on October 1 of each year. The quantitative assessment uses a multi-period excess earnings (“MPEE”) model to estimate the fair value of our franchises. We have determined that only certain cash flows of the store are directly attributable to franchise rights. Future cash flows are based on recently prepared operating forecasts and business plans to estimate the future economic benefits that the store will generate. Operating forecasts and cash flows include estimated revenue growth rates that are calculated based on management’s forecasted sales projections and on the U.S. Department of Labor, Bureau of Labor Statistics for historical consumer price index data. Additionally, we use a contributory asset charge to represent working capital, personal property and assembled workforce costs. A discount rate is utilized to convert the forecasted cash flows to their present value equivalent. The discount rate applied to the future cash flows factors an equity market risk premium, small stock risk premium, an average peer group beta and a risk-free interest rate. See Note 5. Goodwill Goodwill represents the excess purchase price over the fair value of net assets acquired which is not allocable to separately identifiable intangible assets. Other identifiable intangible assets, such as franchise rights, are separately recognized if the intangible asset is obtained through contractual or other legal right or if the intangible asset can be sold, transferred, licensed or exchanged. Goodwill is not amortized but tested for impairment at least annually, and more frequently if events or circumstances indicate the carrying value of the reporting unit more likely than not exceeds fair value. We have the option to qualitatively or quantitatively assess goodwill for impairment and we evaluated our goodwill using a quantitative assessment process. Goodwill is tested for impairment at the reporting unit level. Our reporting units are individual stores as this is the level at which discrete financial information is available and for which operating results are regularly reviewed by our chief operating decision maker to allocate resources and assess performance. We test our goodwill for impairment on October 1 of each year. We used an Adjusted Present Value (“APV”) method, a fair-value based test, to indicate the fair value of our reporting units. Under the APV method, future cash flows based on recently prepared operating forecasts and business plans are used to estimate the future economic benefits generated by the reporting unit. Operating forecasts and cash flows include estimated revenue growth rates based on management’s forecasted sales projections and on U.S. Department of Labor, Bureau of Labor Statistics for historical consumer price index data. A discount rate is utilized to convert the forecasted cash flows to their present value equivalent representing the indicated fair value of our reporting unit. The discount rate applied to the future cash flows factors an equity market risk premium, small stock risk premium, an average peer group beta and a risk-free interest rate. We compare the indicated fair value of our reporting unit to our market capitalization, including consideration of a control premium. The control premium represents the estimated amount an investor would pay to obtain a controlling interest. We believe this reconciliation is consistent with a market participant perspective. The quantitative impairment test of goodwill is a two-step process. The first step identifies potential impairment by comparing the estimated fair value of a reporting unit with its book value. If the fair value of the reporting unit exceeds the carrying amount, goodwill is not impaired and the second step is not necessary. If the carrying value exceeds the fair value, the second step includes determining the implied fair value in the same manner as the amount of goodwill recognized in a business combination is determined. The implied fair value of goodwill is then compared with the carrying amount of goodwill to determine if an impairment loss is necessary. See Note 5. Equity-Method Investments We own investments in certain partnerships which we account for under the equity method. These investments are included as a component of other non-current assets in our Consolidated Balance Sheets. We determined that we lack certain characteristics to direct the operations of the businesses and, as a result, do not qualify to consolidate these investments. Activity related to our equity-method investments is recognized in our Consolidated Statements of Operations as follows: • an other than temporary decline in fair value is reflected as an asset impairment; • our portion of the operating gains and losses is included as a component of other income, net; • the amortization related to the discounted fair value of future equity contributions is recognized over the life of the investments as non-cash interest expense; and • tax benefits and credits are reflected as a component of income tax provision. Periodically, whenever events or circumstances indicate that the carrying amount of assets may be impaired, we evaluate the equity-method investments for indications of loss resulting from an other than temporary decline. If the equity-method investment is determined to be impaired, the amount by which the investment basis exceeds the fair value of the investment is recognized as a charge to income from continuing operations. See Notes 12 and 18. Advertising We expense production and other costs of advertising as incurred as a component of selling, general and administrative expense. Additionally, manufacturer cooperative advertising credits for qualifying, specifically-identified advertising expenditures are recognized as a reduction of advertising expense. Advertising expense and manufacturer cooperative advertising credits were as follows (in thousands): Year Ended December 31, 2015 2014 2013 Advertising expense, gross $ 89,736 $ 62,933 $ 51,404 Manufacturer cooperative advertising credits (19,801 ) (16,281 ) (11,806 ) Advertising expense, net $ 69,935 $ 46,652 $ 39,598 Contract Origination Costs Contract origination commissions paid to our employees directly related to the sale of our self-insured lifetime lube, oil and filter service contracts are deferred and charged to expense in proportion to the associated revenue to be recognized. Legal Costs We are a party to numerous legal proceedings arising in the normal course of business. We accrue for certain legal costs, including attorney fees and potential settlement claims related to various legal proceedings that are estimable and probable. See Note 7. Stock-Based Compensation Compensation costs associated with equity instruments exchanged for employee and director services are measured at the grant date, based on the fair value of the award, with estimated forfeitures considered, and recognized as an expense on the straight-line basis over the individual’s requisite service period (generally the vesting period of the equity award). If there is a performance-based element to the award, the expense is recognized based on the estimated attainment level, estimated time to achieve the attainment level and/or the vesting period. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by persons who receive equity awards. The fair value of non-vested stock awards is based on the intrinsic value on the date of grant. See Note 10. Shares to be issued upon the exercise of stock options and the vesting of stock awards will come from newly issued shares. Income and Other Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance, if needed, reduces deferred tax assets when it is more likely than not that some or all of the deferred tax assets will not be realized. When there are situations with uncertainty as to the timing of the deduction, the amount of the deduction, or the validity of the deduction, we adjust our financial statements to reflect only those tax positions that are more-likely-than-not to be sustained. Positions that meet this criterion are measured using the largest benefit that is more than 50% likely to be realized. Interest and penalties are recorded as income tax provision in the period incurred or accrued when related to an uncertain tax position. See Note 13. We account for all taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction (i.e., sales, use, value-added) on a net (excluded from revenues) basis. Concentration of Risk and Uncertainties We purchase substantially all of our new vehicles and inventory from various manufacturers at the prevailing prices charged by auto makers to all franchised dealers. Our overall sales could be impacted by the auto manufacturers’ inability or unwillingness to supply dealerships with an adequate supply of popular models. We depend on our manufacturers to provide a supply of vehicles which supports expected sales levels. In the event that manufacturers are unable to supply the needed level of vehicles, our financial performance may be adversely impacted. We depend on our manufacturers to deliver high-quality, defect-free vehicles. In the event that manufacturers experience future quality issues, our financial performance may be adversely impacted. We are subject to a concentration of risk in the event of financial distress, including potential reorganization or bankruptcy, of a major vehicle manufacturer. Our sales volume could be materially adversely impacted by the manufacturers’ or distributors’ inability to supply the stores with an adequate supply of vehicles. We also receive incentives and rebates from our manufacturers, including cash allowances, financing programs, discounts, holdbacks and other incentives. These incentives are recorded as accounts receivable in our Consolidated Balance Sheets until payment is received. Our financial condition could be materially adversely impacted by the manufacturers’ or distributors’ inability to continue to offer these incentives and rebates at substantially similar terms, or to pay our outstanding receivables. We enter into Franchise Agreements with the manufacturers. The Franchise Agreements generally limit the location of the dealership and provide the auto manufacturer approval rights over changes in dealership management and ownership. The auto manufacturers are also entitled to terminate the Franchise Agreement if the dealership is in material breach of the terms. Our ability to expand operations depends, in part, on obtaining consents of the manufacturers for the acquisition of additional dealerships. See also “Goodwill” and “Franchise Value” above. We have a credit facility with a syndicate of 18 financial institutions, including eight manufacturer-affiliated finance companies. Several of these financial institutions also provide mortgage financing. This credit facility is the primary source of floor plan financing for our new vehicle inventory and also provides used vehicle financing and a revolving line of credit. The term of the facility extends through January 2021. At maturity, our financial condition could be materially adversely impacted if lenders are unable to provide credit that has typically been extended to us or with terms unacceptable to us. Our financial condition could be materially adversely impacted if these providers incur losses in the future or undergo funding limitations. See Note 6. We anticipate continued organic growth and growth through acquisitions. This growth will require additional credit which may be unavailable or with terms unacceptable to us. If these events were to occur, we may not be able to borrow sufficient funds to facilitate our growth. Financial Instruments, Fair Value and Market Risks The carrying amounts of cash equivalents, accounts receivable, trade payables, accrued liabilities and short-term borrowings approximate fair value because of the short-term nature and current market rates of these instruments. Fair value estimates are made at a specific point in time, based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. See Note 12. We have variable rate floor plan notes payable, mortgages and other credit line borrowings that subject us to market risk exposure. At December 31, 2015, we had $1.7 billion outstanding in variable rate debt. These borrowings had interest rates ranging from 1.49% to 3.00% per annum. An increase or decrease in the interest rates would affect interest expense for the period accordingly. The fair value of long-term, fixed interest rate debt is subject to interest rate risk. Generally, the fair value of fixed interest rate debt will increase as interest rates fall because we could refinance for a lower rate. Conversely, the fair value of fixed interest rate debt will decrease as interest rates rise. The interest rate changes affect the fair value, but do not impact earnings or cash flows. We monitor our fixed interest rate debt regularly, refinancing debt that is materially above market rates if permitted. See Note 12. We are also subject to market risk from changing interest rates. From time to time, we reduce our exposure to this market risk by entering into interest rate swaps and designating the swaps as cash flow hedges. We are generally exposed to credit or repayment risk based on our relationship with the counterparty to the derivative financial instrument. We minimize the credit or repayment risk on our derivative instruments by entering into transactions with institutions whose credit rating is Aa or higher. See Note 11. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and related notes to financial statements. Changes in such estimates may affect amounts reported in future periods. Estimates are used in the calculation of certain reserves maintained for charge-backs on estimated cancellations of service contracts; life, accident and disability insurance policies; finance fees from customer financing contracts and uncollectible accounts receivable. We also use estimates in the calculation of various expenses, accruals and reserves, including anticipated losses related to workers’ compensation insurance; anticipated losses related to self-insurance components of our property and casualty and medical insurance; self-insured lifetime lube, oil and filter service contracts; discretionary employee bonuses, the Transition Agreement with Sidney B. DeBoer, our Executive Chairman; warranties provided on certain products and services; legal reserves and stock-based compensation. We also make certain estimates regarding the assessment of the recoverability of long-lived assets, indefinite-lived intangible assets and deferred tax assets. We offer a limited warranty on the sale of most retail used vehicles. This warranty is based on mileage and time. We also offer a mileage and time based warranty on parts used in our service repair work and on tire purchases. The cost that may be incurred for these warranties is estimated at the time the related revenue is recorded. A reserve for these warranty liabilities is estimated based on current sales levels, warranty experience rates and estimated costs per claim. The annual activity for reserve increases and claims is immaterial. As of December 31, 2015 and 2014, the accrued warranty balance was $0.5 million and $0.4 million, respectively. Fair Value of Assets Acquired and Liabilities Assumed We estimate the fair value of the assets acquired and liabilities assumed in a business combination using various assumptions. The most significant assumptions used relate to determining the fair value of property and equipment and intangible franchise rights. We estimate the fair value of property and equipment based on a market valuation approach. We use prices and other relevant information generated primarily by recent market transactions involving similar or comparable assets, as well as our historical experience in divestitures, acquisitions and real estate transactions. Additionally, we may use a cost valuation approach to value long-lived assets when a market valuation approach is unavailable. Under this approach, we determine the cost to replace the service capacity of an asset, adjusted for physical and economic obsolescence. When available, we use valuation inputs from independent valuation experts, such as real estate appraisers and brokers, to corroborate our estimates of fair value. We use an MPEE model to determine the fair value of intangible franchise rights as discussed above under “Franchise Value.” We use a relief-from-royalty method to determine the fair value of a trade name. Future cost savings associated with owning, rather than licensing, a trade name is estimated based on a royalty rate and management’s forecasted sales projections. The discount rate applied to the future cost savings factors an equity market risk premium, small stock risk premium, an average peer group beta, a risk-free interest rate and a premium for forecast risk. Revenue Recognition Revenue from the sale of a vehicle is recognized when a contract is signed by the customer, financing has been arranged or collectability is reasonably assured and the delivery of the vehicle to the customer is made. We do not allow the return of new or used vehicles, except where mandated by state law. Revenue from parts and service is recognized upon delivery of the parts or service to the customer. We allow for customer returns on sales of our parts inventory up to 30 days after the sale. Most parts returns generally occur within one to two weeks from the time of sale, and are not significant. Finance fees earned for notes placed with financial institutions in connection with customer vehicle financing are recognized, net of estimated charge-backs, as finance and insurance revenue upon acceptance of the credit by the financial institution and recognition of the sale of the vehicle. Insurance income from third party insurance companies for commissions earned on credit life, accident and disability insurance policies sold in connection with the sale of a vehicle are recognized, net of anticipated cancellations, as finance and insurance revenue upon execution of the insurance contract and recognition of the sale of the vehicle. Commissions from third party service contracts are recognized, net of anticipated cancellations, as finance and insurance revenue upon sale of the contracts and recognition of the sale of the vehicle. We also participate in future underwriting profit, pursuant to retrospective commission arrangements, which is recognized in income as earned. Revenue related to self-insured lifetime lube, oil and filter service contracts is deferred and recognized based on expected future claims for service. The expected future claims experience is evaluated periodically to ensure it remains appropriate given actual claims history. Segment Reporting While we have determined that each individual store is a reporting unit, we have aggregated our reporting units into three reportable segments based on their economic similarities: Domestic, Import and Luxury. Our Domestic segment is comprised of retail automotive franchises that sell new vehicles manufactured by Chrysler, General Motors and Ford. Our Import segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Honda, Toyota, Subaru, Nissan and Volkswagen. Our Luxury segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by BMW, Mercedes-Benz and Lexus. The franchises in each segment also sell used vehicles, parts and automotive services, and automotive finance and insurance products. Corporate and other revenue and income includes the results of operations of our stand-alone collision center offset by unallocated corporate overhead expenses, such as corporate personnel costs, and certain unallocated reserve and elimination adjustments. Additionally, certain internal corporate expense allocations increase segment income for Corporate and other while decreasing segment income for the other reportable segments. These internal corporate expense allocations are used to increase comparability of our dealerships and reflect the capital burden a stand-alone dealership would experience. Examples of these internal allocations include internal rent expense, internal floor plan financing charges, and internal fees charged to offset employees within our corporate headquarters that perform certain dealership functions. We define our chief operating decision maker (“CODM”) to be certain members of our executive management group. Historical and forecasted operational performance is evaluated on a store-by-store basis and on a consolidated basis by the CODM. We derive the operating results of the segments directly from our internal management reporting system. The accounting policies used to derive segment results are substantially the same as those used to determine our consolidated results, excepted for the internal allocation within Corporate and other discussed above. Our CODM measures the performance of each operating segment based on several metrics, including earnings from operations, and uses these results, in part, to evaluate the performance of, and to allocate resources to, each of the operating segments. See Note 19. |
Note 2 - Accounts Receivable
Note 2 - Accounts Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | (2) Accounts Receivable Accounts receivable consisted of the following (in thousands): December 31, 2015 2014 Contracts in transit $ 168,460 $ 162,785 Trade receivables 33,749 37,194 Vehicle receivables 36,470 34,876 Manufacturer receivables 59,215 56,008 Auto loan receivables 42,490 25,424 Other receivables 3,033 4,554 343,417 320,841 Less: Allowance for doubtful accounts (2,243 ) (2,904 ) Less: Long-term portion of accounts receivable, net (32,712 ) (22,558 ) Total accounts receivable, net $ 308,462 $ 295,379 Accounts receivable classifications include the following: • Contracts in transit are receivables from various lenders for the financing of vehicles that we have arranged on behalf of the customer and are typically received within five to ten days of selling a vehicle. • Trade receivables are comprised of amounts due from customers, lenders for the commissions earned on financing and others for commissions earned on service contracts and insurance products. • Vehicle receivables represent receivables for the portion of the vehicle sales price paid directly by the customer. • Manufacturer receivables represent amounts due from manufacturers, including holdbacks, rebates, incentives and warranty claims. • Auto loan receivables include amounts due from customers related to retail sales of vehicles and certain finance and insurance products. Interest income on auto loan receivables is recognized based on the contractual terms of each loan and is accrued until repayment, charge-off or repossession. Direct costs associated with loan originations are capitalized and expensed as an offset to interest income when recognized on the loans. All other receivables are recorded at invoice and do not bear interest until they are 60 days past due. The allowance for doubtful accounts is estimated based on our historical write-off experience and is reviewed monthly. Consideration is given to recent delinquency trends and recovery rates. Account balances are charged against the allowance after all appropriate means of collection have been exhausted and the potential for recovery is considered remote. The annual activity for charges and subsequent recoveries is immaterial. The long-term portion of accounts receivable was included as a component of other non-current assets in the Consolidated Balance Sheets. |
Note 3 - Inventories
Note 3 - Inventories | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | (3) Inventories The components of inventories consisted of the following (in thousands): December 31, 2015 2014 New vehicles $ 1,113,613 $ 958,876 Used vehicles 302,911 240,908 Parts and accessories 54,463 49,875 Total inventories $ 1,470,987 $ 1,249,659 The new vehicle inventory cost is generally reduced by manufacturer holdbacks and incentives, while the related floor plan notes payable are reflective of the gross cost of the vehicle. As of December 31, 2015 and 2014, the carrying value of inventory had been reduced by $13.6 million and $12.3 million, respectively, for assistance received from manufacturers as discussed in Note 1. |
Note 4 - Property and Equipment
Note 4 - Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Property, Plant and Equipment Disclosure [Text Block] | (4) Property and Equipment Property and equipment consisted of the following (in thousands): December 31, 2015 2014 Land $ 281,982 $ 263,328 Building and improvements 527,545 475,149 Service equipment 70,559 60,644 Furniture, office equipment, signs and fixtures 119,250 100,163 999,336 899,284 Less accumulated depreciation (137,853 ) (117,679 ) 861,483 781,605 Construction in progress 15,177 35,140 $ 876,660 $ 816,745 Long-lived Asset Impairment Charges In 2015, we recorded $3.6 million of impairment charges associated with certain properties and equipment. As the expected future use of these facilities and equipment changed, the long-lived assets were tested for recoverability and were determined to have a carrying value exceeding their fair value. |
Note 5 - Goodwill and Franchise
Note 5 - Goodwill and Franchise Value | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Goodwill and Intangible Assets Disclosure [Text Block] | (5) Goodwill and Franchise Value The following is a roll-forward of goodwill (in thousands): Domestic Import Luxury Consolidated Balance as of December 31, 2013 (1) $ 22,548 $ 16,797 $ 10,166 $ 49,511 Additions through acquisitions 68,463 62,804 18,597 149,864 Balance as of December 31, 2014 (1) 91,011 79,601 28,763 199,375 Additions through acquisitions 6,892 5,029 2,170 14,091 Reductions through divestitures — (246 ) — (246 ) Balance as of December 31, 2015 (1) $ 97,903 $ 84,384 $ 30,933 $ 213,220 (1) Net of accumulated impairment losses of $299.3 million recorded during the year ended December 31, 2008. The following is a roll-forward of franchise value (in thousands): Franchise Value Balance as of December 31, 2013 $ 71,199 Additions through acquisitions 80,233 Transfers to assets held for sale (540 ) Balance as of December 31, 2014 150,892 Additions through acquisitions 6,843 Reductions through divestitures (36 ) Balance as of December 31, 2015 $ 157,699 |
Note 6 - Credit Facilities and
Note 6 - Credit Facilities and Long-term Debt | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | (6) Credit Facilities and Long-Term Debt Below is a summary of our outstanding balances on credit facilities and long-term debt (in thousands): December 31, 2015 2014 New vehicle floor plan commitment $ 1,265,872 $ 1,137,632 Floor plan notes payable (1) 48,083 41,047 Total floor plan debt 1,313,955 1,178,679 Used vehicle inventory financing facility 171,000 134,000 Revolving lines of credit 61,246 134,769 Real estate mortgages 387,861 334,443 Other debt 25,247 37,766 Total debt $ 1,959,309 $ 1,819,657 (1) At December 31, 2014, we had an additional $4.9 million of floor plan notes payable outstanding on our new vehicle floor plan commitment recorded as liability related to assets held for sale. Credit Facility We have a $1.85 billion revolving syndicated credit facility that matures in January 2021. This syndicated credit facility is comprised of 18 financial institutions, including eight manufacturer-affiliated finance companies. As of December 31, 2015, our credit facility provides for up to $1.45 billion in new vehicle inventory floor plan financing, up to $200 million in used vehicle inventory floor plan financing and a maximum of $200 million in revolving financing for general corporate purposes, including acquisitions and working capital. This credit facility may be expanded to $2.1 billion total availability, subject to lender approval. We may request a reallocation of any unused portion of our credit facility provided that the used vehicle inventory floor plan commitment does not exceed $250 million, the revolving financing commitment does not exceed $300 million, and the sum of those commitments plus the new vehicle inventory floor plan financing commitment does not exceed the total aggregate financing commitment. All borrowings from, and repayments to, our lending group are presented in the Consolidated Statements of Cash Flows as financing activities. The new vehicle floor plan commitment is collateralized by our new vehicle inventory. Our used vehicle inventory financing facility is collateralized by our used vehicle inventory that has been in stock for less than 180 days. Our revolving line of credit is secured by our outstanding receivables related to vehicle sales, unencumbered vehicle inventory, other eligible receivables, parts and accessories and equipment. We have the ability to deposit up to $50 million in cash in Principal Reduction “PR” accounts associated with our new vehicle inventory floor plan commitment. The PR accounts are recognized as offsetting credits against outstanding amounts on our new vehicle floor plan commitment and would reduce interest expense associated with the outstanding principal balance. As of December 31, 2015, we did not have any amounts deposited in our PR accounts. If the outstanding principal balance on our new vehicle inventory floor plan commitment, plus requests on any day, exceeds 95% of the loan commitment, a portion of the revolving line of credit must be reserved. The reserve amount is equal to the lesser of $15.0 million or the maximum revolving line of credit commitment less the outstanding balance on the line less outstanding letters of credit. The reserve amount will decrease the revolving line of credit availability and may be used to repay the new vehicle floor plan commitment balance. The interest rate on the credit facility varies based on the type of debt, with the rate of one-month LIBOR plus 1.25% for new vehicle floor plan financing, one-month LIBOR plus 1.50% for used vehicle floor plan financing; and a variable interest rate on the revolving financing ranging from the one-month LIBOR plus 1.25% to 2.50%, depending on our leverage ratio. The annual interest rate associated with our new vehicle floor plan commitment, excluding the effects of our interest rate swaps, was 1.68% at December 31, 2015. The annual interest rate associated with our used vehicle inventory financing facility and our revolving line of credit was 1.93% and 2.18%, respectively, at December 31, 2015. Under the terms of our credit facility we are subject to financial covenants and restrictive covenants that limit or restrict our incurring additional indebtedness, making investments, selling or acquiring assets and granting security interests in our assets. As of December 31, 2015, we were in compliance with all financial covenants. The table below details our financial covenants: Debt Covenant Ratio Requirement As of December 31, 2015 Current ratio Not less than 1.10 to 1 1.26 to 1 Fixed charge coverage ratio Not less than 1.20 to 1 3.36 to 1 Leverage ratio Not more than 5.00 to 1 1.79 to 1 Funded debt restriction Not to exceed $600 million $413.4 million Floor Plan Notes Payable We have floor plan agreements with manufacturer-affiliated finance companies for vehicles that are designated for use as service loaners. The interest rates on these floor plan notes payable commitments vary by manufacturer and are variable rates. At December 31, 2015, $48.1 million was outstanding on these agreements at interest rates ranging up to 3.0%. Borrowings from, and repayments to, manufacturer-affiliated finance companies are classified as operating activities in the Consolidated Statements of Cash Flows. Real Estate Mortgages and Other Debt We have mortgages associated with our owned real estate. Interest rates related to this debt ranged from 1.8% to 5.0% at December 31, 2015. The mortgages are payable in various installments through October 2034. As of December 31, 2015, we had fixed interest rates on 70% of our outstanding mortgage debt. Our other debt includes capital leases, sellers’ notes and our equity contribution obligations associated with the new markets tax credit equity-method investment. The interest rates associated with our other debt ranged from 2.2% to 6.5% at December 31, 2015. This debt, which totaled $25.2 million at December 31, 2015, is due in various installments through January 2024. Future Principal Payments The schedule of future principal payments associated with real estate mortgages and other debt as of December 31, 2015 was as follows (in thousands): Year Ending December 31, 2016 $ 38,823 2017 39,164 2018 39,547 2019 41,775 2020 32,923 Thereafter 220,876 Total principal payments $ 413,108 |
Note 7 - Commitments and Contin
Note 7 - Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | (7) Commitments and Contingencies Leases We lease certain facilities under non-cancelable operating and capital leases. These leases expire at various dates through 2066. Certain lease commitments contain fixed payment increases at predetermined intervals over the life of the lease, while other lease commitments are subject to escalation clauses of an amount equal to the increase in the cost of living based on the “Consumer Price Index - U.S. Cities Average - All Items for all Urban Consumers” published by the U.S. Department of Labor, or a substantially equivalent regional index. Lease expense related to operating leases is recognized on a straight-line basis over the life of the lease. The minimum lease payments under our operating and capital leases after December 31, 2015 are as follows (in thousands): Year Ending December 31, 2016 $ 25,514 2017 22,910 2018 20,818 2019 19,740 2020 18,186 Thereafter 123,093 Total minimum lease payments 230,261 Less: sublease rentals (8,723 ) $ 221,538 Rent expense, net of sublease income, for all operating leases was $23.8 million, $17.2 million and $14.0 million for the years ended December 31, 2015, 2014 and 2013, respectively. These amounts are included as a component of selling, general and administrative expenses in our Consolidated Statements of Operations. In connection with dispositions of dealerships, we occasionally assign or sublet our interests in any real property leases associated with such dealerships to the purchaser. We often retain responsibility for the performance of certain obligations under such leases to the extent that the assignee or sublessee does not perform. Additionally, we may remain subject to the terms of any guarantees and have correlating indemnification rights against the assignee or sublessee in the event of non-performance, as well as certain other defenses. We may also be called upon to perform other obligations under these leases, such as environmental remediation of the premises or repairs upon termination of the lease. We currently have no reason to believe that we will be called upon to perform any such services; however, there can be no assurance that any future performance required by us under these leases will not have a material adverse effect on our financial condition or results of operations. Charge-Backs for Various Contracts We have recorded a liability of $35.0 million as of December 31, 2015 for our estimated contractual obligations related to potential charge-backs for vehicle service contracts, lifetime oil change contracts and other various insurance contracts that are terminated early by the customer. We estimate that the charge-backs will be paid out as follows (in thousands): Year Ending December 31, 2016 $ 19,638 2017 10,127 2018 3,907 2019 1,124 2020 214 Thereafter 23 Total $ 35,033 Lifetime Lube, Oil and Filter Contracts We retain the obligation for lifetime lube, oil and filter service contracts sold to our customers and assumed the liability of certain existing lifetime lube, oil and filter contracts. These amounts are recorded as deferred revenues. At the time of sale, we defer the full sale price and recognize the revenue based on the rate we expect future costs to be incurred. As of December 31, 2015, we had a deferred revenue balance of $80.2 million associated with these contracts and estimate the deferred revenue will be recognized as follows (in thousands): Year Ending December 31, 2016 $ 16,103 2017 12,573 2018 10,053 2019 8,406 2020 7,118 Thereafter 25,940 Total $ 80,193 The current portion of this deferred revenue balance is recorded as a component of accrued liabilities in our Consolidated Balance Sheets. We periodically evaluate the estimated future costs of these assumed contracts and record a charge if future expected claim and cancellation costs exceed the deferred revenue to be recognized. As of December 31, 2015, we had a reserve balance of $3.4 million recorded as a component of accrued liabilities and other long-term liabilities in our Consolidated Balance Sheets. The charges associated with this reserve were recognized in 2011 and earlier. Self-insurance Programs We self-insure a portion of our property and casualty insurance, vehicle open lot coverage, medical insurance and workers’ compensation insurance. Third parties are engaged to assist in estimating the loss exposure related to the self-retained portion of the risk associated with these insurances. Additionally, we analyze our historical loss and claims experience to estimate the loss exposure associated with these programs. As of December 31, 2015 and 2014, we had liabilities associated with these programs of $25.9 million and $23.2 million, respectively, recorded as a component of accrued liabilities and other long-term liabilities in our Consolidated Balance Sheets. Litigation We are party to numerous legal proceedings arising in the normal course of our business. Although we do not anticipate that the resolution of legal proceedings arising in the normal course of business will have a material adverse effect on our business, results of operations, financial condition, or cash flows, we cannot predict this with certainty. Stein Litigation On December 14, 2015, Shiva Y. Stein, a Lithia shareholder, filed derivative claims on behalf of Lithia against its Board of Directors, also listing Lithia as a nominal defendant. The case, Stein v. DeBoer, et al. |
Note 8 - Stockholders' Equity
Note 8 - Stockholders' Equity | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | (8) Stockholders’ Equity Class A and Class B Common Stock The shares of Class A common stock are not convertible into any other series or class of our securities. Each share of Class B common stock, however, is freely convertible into one share of Class A common stock at the option of the holder of the Class B common stock. All shares of Class B common stock shall automatically convert to shares of Class A common stock (on a share-for-share basis, subject to adjustment) on the earliest record date for an annual meeting of our stockholders on which the number of shares of Class B common stock outstanding is less than 1% of the total number of shares of common stock outstanding. Shares of Class B common stock may not be transferred to third parties, except for transfers to certain family members and in other limited circumstances. Holders of Class A common stock are entitled to one vote for each share held of record and holders of Class B common stock are entitled to ten votes for each share held of record. The Class A common stock and Class B common stock vote together as a single class on all matters submitted to shareholders. Repurchases of Class A Common Stock In August 2011, our Board of Directors authorized the repurchase of up to 2,000,000 shares of our Class A common stock and, on July 20, 2012, our Board of Directors authorized the repurchase of 1,000,000 additional shares of our Class A common stock. Through December 31, 2015, we had purchased approximately 1.7 million shares under this program at an average price of $41.34 per share. As of December 31, 2015, 1.3 million shares remained available for purchase pursuant to this program. These plans do not have an expiration date and we may continue to repurchase shares from time to time as conditions warrant. The following is a summary of our repurchases in the years ended December 31, 2015, 2014 and 2013: Year Ended December 31, 2015 2014 2013 Shares repurchased pursuant to repurchase plan 228,737 226,729 127,900 Total purchase price (in thousands) $ 24,676 $ 15,990 $ 5,213 Average purchase price per share $ 107.88 $ 70.52 $ 40.76 Shares repurchased in association with tax withholdings on the exercise of stock options 77,649 106,772 59,721 Dividends We declared and paid dividends on our Class A and Class B Common Stock as follows: Quarter declared Dividend amount per Class A and Class B share Total amount of dividend (in thousands) 2013 First quarter (1) $ — $ — Second quarter 0.13 3,356 Third quarter 0.13 3,363 Fourth quarter 0.13 3,366 2014 First quarter $ 0.13 $ 3,378 Second quarter 0.16 4,179 Third quarter 0.16 4,174 Fourth quarter 0.16 4,198 2015 First quarter $ 0.16 $ 4,216 Second quarter 0.20 5,266 Third quarter 0.20 5,257 Fourth quarter 0.20 5,246 (1) We declared and paid a dividend payment in December 2012 in lieu of the dividend typically declared and paid in March of the following year. Reclassification From Accumulated Other Comprehensive Loss The reclassification from accumulated other comprehensive loss was as follows (in thousands): Year Ended December 31, 2015 2014 2013 Affected Line Item in the Consolidated Statement of Operations Loss on cash flow hedges $ (449 ) $ (488 ) $ (740 ) Floor plan interest expense Income tax benefits 174 187 283 Income tax provision Loss on cash flow hedges, net $ (275 ) $ (301 ) $ (457 ) See Note 11 for more details regarding our derivative contracts. |
Note 9 - 401(k) Profit Sharing,
Note 9 - 401(k) Profit Sharing, Deferred Compensation and Long-term Incentive Plans | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Pension and Other Postretirement Benefits Disclosure [Text Block] | (9) 401(k) Profit Sharing, Deferred Compensation and Long-Term Incentive Plans We have a defined contribution 401(k) plan and trust covering substantially all full-time employees. The annual contribution to the plan is at the discretion of our Board of Directors. Contributions of $5.3 million, $3.2 million and $2.1 million were recognized for the years ended December 31, 2015, 2014 and 2013, respectively. Employees may contribute to the plan if they meet certain eligibility requirements. We offer a deferred compensation and long-term incentive plan (the “LTIP”) to provide certain employees the ability to accumulate assets for retirement on a tax deferred basis. We may make discretionary contributions to the LTIP. Discretionary contributions vest between one and seven years based on the employee’s age and position. Additionally, a participant may defer a portion of his or her compensation and receive the deferred amount upon certain events, including termination or retirement. The following is a summary related to our LTIP: Year Ended December 31, 2015 2014 2013 Compensation expense (in millions) $ 1.8 $ 1.9 $ 1.4 Total discretionary contribution (in millions) $ 2.2 $ 2.4 $ 2.1 Guaranteed annual return 5.25 % 5.25 % 5.25 % As of December 31, 2015 and 2014, the balance due to participants was $19.7 million and $14.2 million, respectively, and was included as a component of other long-term liabilities in the Consolidated Balance Sheets. |
Note 10 - Stock-based Compensat
Note 10 - Stock-based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | (10) Stock-Based Compensation 2009 Employee Stock Purchase Plan The 2009 Employee Stock Purchase Plan (the “2009 ESPP”) allows for the issuance of 1,500,000 shares of our Class A common stock. The 2009 ESPP is intended to qualify as an “Employee Stock Purchase Plan” under Section 423 of the Internal Revenue Code of 1986, as amended, and is administered by the Compensation Committee of the Board of Directors. Eligible employees are entitled to defer up to 10% of their base pay for the purchase of stock, up to $25,000 of fair market value of our Class A common stock annually. The purchase price is equal to 85% of the fair market value at the end of the purchase period. Following is information regarding our 2009 ESPP: Year Ended December 31, 2015 Shares purchased pursuant to 2009 ESPP 71,811 Weighted average per share price of shares purchased $ 90.04 Weighted average per share discount from market value for shares purchased $ 15.89 As of December 31, 2015 Shares available for purchase pursuant to 2009 ESPP 467,660 Compensation expense related to our 2009 ESPP is calculated based on the 15% discount from the per share market price on the date of grant. 2013 Stock Incentive Plan Our 2013 Stock Incentive Plan, as amended, (the “2013 Plan”) allows for the grant of a total of 3.8 million shares in the form of stock appreciation rights, qualified stock options, nonqualified stock options and shares of restricted stock to our officers, key employees, directors and consultants. The 2013 Plan is administered by the Compensation Committee of the Board of Directors and permits accelerated vesting of outstanding awards upon the occurrence of certain changes in control. As of December 31, 2015, 1,520,910 shares of Class A common stock were available for future grants. As of December 31, 2015, there were no stock appreciation rights, qualified stock options or shares of restricted stock outstanding. Restricted Stock Units (“RSUs”) RSU grants vest over a period up to four years from the date of grant. RSU activity was as follows: RSUs Weighted average grant date fair value Balance, December 31, 2014 464,758 $ 36.33 Granted 171,185 88.74 Vested (216,833 ) 62.74 Forfeited (8,036 ) 57.73 Balance, December 31, 2015 411,074 59.13 We granted 34,903 time-vesting RSUs to members of our Board of Directors and employees in 2015. Each grant entitles the holder to receive shares of our Class A common stock upon vesting. A quarter of the RSUs vest on each of the four anniversaries of the grant date for employees and vests quarterly for our Board of Directors, over their service period. Certain key employees were granted 85,290 performance and time-vesting RSUs in 2015. The RSUs entitled the holder to receive shares based on attaining various target levels of operational performance. Based on the levels of performance achieved in 2015, a weighted average attainment level of 72% for these RSUs was met. These RSUs will vest over four years from the grant date. Twelve senior executives were also granted 50,992 long-term RSUs which vest based on attaining or exceeding a specified target level of adjusted net income per share in any fiscal year ending between December 31, 2015 and December 31, 2018. The RSUs will vest on the date the target level is certified. Stock Options Stock options become exercisable over a period of up to five years from the date of grant with expiration dates up to ten years from the date of grant and at exercise prices of not less than market value, as determined by the Board of Directors. The expiration date of options granted is six years. Stock option activity was as follows: Shares subject to options Weighted average exercise price Aggregate intrinsic value (in millions) Weighted average remaining contractual term (in years) Balance, December 31, 2014 6,834 $ 6.79 $ 0.5 0.8 Granted — — Forfeited — — Expired (2,000 ) 3.23 Exercised (4,834 ) 8.27 Balance, December 31, 2015 — — — — Exercisable, December 31, 2015 — — — — Stock-Based Compensation As of December 31, 2015, unrecognized stock-based compensation related to outstanding, but unvested RSUs was $10.3 million, which will be recognized over the remaining weighted average vesting period of 1.3 years. Certain information regarding our stock-based compensation was as follows: Year Ended December 31, 2015 2014 2013 Per share intrinsic value of non-vested stock granted $ 88.74 $ 68.99 $ 43.13 Weighted average per share discount for compensation expense recognized under the 2009 ESPP 15.89 11.92 8.81 Total intrinsic value of stock options exercised (in millions) 0.5 3.1 8.7 Fair value of non-vested stock that vested during the period (in millions) 19.3 18.9 8.4 Stock-based compensation recognized in Consolidated Statements of Operations, as a component of selling, general and administrative expense (in millions) 11.9 7.4 6.6 Tax benefit recognized in Consolidated Statements of Operations (in millions) 4.2 2.6 2.3 Cash received from options exercised and shares purchased under all share-based arrangements (in millions) 6.5 4.9 5.2 Tax deduction realized related to stock options exercised (in millions) 7.6 8.4 6.5 |
Note 11 - Derivative Financial
Note 11 - Derivative Financial Instrument | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | (11) Derivative Financial Instruments From time to time, we enter into interest rate swaps to fix a portion of our interest expense. We do not enter into derivative instruments for any purpose other than to manage interest rate exposure to fluctuations in the one-month LIBOR benchmark. That is, we do not engage in interest rate speculation using derivative instruments. As of December 31, 2015, we had a $25 million interest rate swap outstanding with U.S. Bank Dealer Commercial Services. This interest rate swap matures on June 15, 2016 and has a fixed rate of 5.587% per annum. The variable rate on the interest rate swap is the one-month LIBOR rate. At December 31, 2015, the one-month LIBOR rate was 0.43% per annum, as reported in the Wall Street Journal. Typically, we designate all interest rate swaps as cash flow hedges and, accordingly, we record the change in fair value for the effective portion of these interest rate swaps in comprehensive income rather than net income until the underlying hedged transaction affects net income. If a swap is no longer designated as a cash flow hedge and the forecasted transaction remains probable or reasonably possible of occurring, the gain or loss recorded in accumulated other comprehensive loss is recognized in income as the forecasted transaction occurs. If the forecasted transaction is probable of not occurring, the gain or loss recorded in accumulated other comprehensive loss is recognized in income immediately. The estimated amount that we expect to reclassify from accumulated other comprehensive loss to net income within the next twelve months is $0.5 million at December 31, 2015. The fair value of our derivative instruments was included in our Consolidated Balance Sheets as follows (in thousands): Balance Sheet Information Fair Value of Liability Derivatives Derivatives Designated as Hedging Instruments Location in Balance Sheet December 31, 2015 Interest Rate Swap Contract Accrued liabilities $ 532 Other long-term liabilities — $ 532 Balance Sheet Information Fair Value of Liability Derivatives Derivatives Designated as Hedging Instruments Location in Balance Sheet December 31, 2014 Interest Rate Swap Contract Accrued liabilities $ 1,194 Other long-term liabilities 556 $ 1,750 The effect of derivative instruments in our Consolidated Statements of Operations was as follows (in thousands): Derivatives in Cash Flow Hedging Relationships Amount of gain recognized in Accumulated OCI (effective portion) Location of loss reclassified from Accumulated OCI into Income (effective portion) Amount of loss reclassified from Accumulated OCI into Income (effective portion) Location of loss recognized in Income on derivative (ineffective portion and amount excluded from effectiveness testing) Amount of loss recognized in Income on derivative (ineffective portion and amount excluded from effectiveness testing) For the Year Ended December 31, 2015 Interest rate swap contract $ 599 Floor plan interest expense $ (449 ) Floor plan interest expense $ (758 ) For the Year Ended December 31, 2014 Interest rate swap contract $ 505 Floor plan interest expense $ (488 ) Floor plan interest expense $ (732 ) For the Year Ended December 31, 2013 Interest rate swap contracts $ 1,005 Floor plan interest expense $ (740 ) Floor plan interest expense $ (1,235 ) |
Note 12 - Fair Value Measuremen
Note 12 - Fair Value Measurements | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | (12) Fair Value Measurements Factors used in determining the fair value of our financial assets and liabilities are summarized into three broad categories: • Level 1 - quoted prices in active markets for identical securities; • Level 2 - other significant observable inputs, including quoted prices for similar securities, interest rates, prepayment spreads, credit risk; and • Level 3 - significant unobservable inputs, including our own assumptions in determining fair value. The inputs or methodology used for valuing financial assets and liabilities are not necessarily an indication of the risk associated with investing in them. We use the income approach to determine the fair value of our interest rate swap using observable Level 2 market expectations at each measurement date and an income approach to convert estimated future cash flows to a single present value amount (discounted) assuming that participants are motivated, but not compelled, to transact. Level 2 inputs for the swap valuation are limited to quoted prices for similar assets or liabilities in active markets (specifically futures contracts on LIBOR for the first two years) and inputs other than quoted prices that are observable for the asset or liability (specifically LIBOR cash and swap rates and credit risk at commonly quoted intervals). Mid-market pricing is used as a practical expedient for fair value measurements. Key inputs, including the cash rates for very short term borrowings, futures rates for up to two years and LIBOR swap rates beyond the derivative maturity, are used to predict future reset rates to discount those future cash flows to present value at the measurement date. Inputs are collected from Bloomberg on the last market day of the period and used to determine the rate applied to discount the future cash flows. The valuation of the interest rate swap also takes into consideration estimates of our own, as well as the counterparty’s, risk of non-performance under the contract. See Note 8 and 11 for more details regarding our derivative contracts. We estimate the value of our equity-method investment, which is recorded at fair value on a non-recurring basis, based on a market valuation approach. We use prices and other relevant information generated primarily by recent market transactions involving similar or comparable assets. Because these valuations contain unobservable inputs, we classified the measurement of fair value of our equity-method investment as Level 3. We estimate the value of other long-lived assets that are recorded at fair value on a non-recurring based on a market valuation approach. We use prices and other relevant information generated primarily by recent market transactions involving similar or comparable assets, as well as our historical experience in divestitures, acquisitions and real estate transactions. Additionally, we may use a cost valuation approach to value long-lived assets when a market valuation approach is unavailable. Under this approach, we determine the cost to replace the service capacity of an asset, adjusted for physical and economic obsolescence. When available, we use valuation inputs from independent valuation experts, such as real estate appraisers and brokers, to corroborate our estimates of fair value. Real estate appraisers’ and brokers’ valuations are typically developed using one or more valuation techniques including market, income and replacement cost approaches. Because these valuations contain unobservable inputs, we classified the measurement of fair value of long-lived assets as Level 3. There were no changes to our valuation techniques during the year ended December 31, 2015. Assets and Liabilities Measured at Fair Value Following are the disclosures related to our assets and (liabilities) that are measured at fair value (in thousands): Fair Value at December 31, 2015 Level 1 Level 2 Level 3 Measured on a recurring basis: Derivative contract, net $ — $ 532 $ — Measured on a non-recurring basis: Equity-method investment $ — $ — $ 22,284 Long-lived assets held and used: Certain buildings and improvements — — 6,559 Fair Value at December 31, 2014 Level 1 Level 2 Level 3 Measured on a recurring basis: Derivative contract, net $ — $ 1,750 $ — Measured on a non-recurring basis: Equity-method investment $ — $ — $ 33,282 See Note 11 for more details regarding our derivative contracts. Based on operating losses recognized by the equity-method investment, we determined that an impairment of our investment had occurred. Accordingly, we performed a fair value calculation for this investment and determined that a $16.5 million and $1.9 million impairment, respectively, was required to be recorded as asset impairments in our Consolidated Statements of Operations for the years ended December 31, 2015 and 2014, respectively. See Note 18. Fair Value Disclosures for Financial Assets and Liabilities We have fixed rate debt and calculate the estimated fair value of our fixed rate debt using a discounted cash flow methodology. Using estimated current interest rates based on a similar risk profile and duration (Level 2), the fixed cash flows are discounted and summed to compute the fair value of the debt. As of December 31, 2015, this debt had maturity dates between November 2016 and October 2034. A summary of the aggregate carrying values and fair values of our long-term fixed interest rate debt is as follows (in thousands): December 31, 2015 2014 Carrying value $ 297,463 $ 257,780 Fair value 296,961 270,781 We believe the carrying value of our variable rate debt approximates fair value. |
Note 13 - Income Taxes
Note 13 - Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | (13) Income Taxes Income Tax Provision Income tax provision from continuing operations was as follows (in thousands): Year Ended December 31, 2015 2014 2013 Current: Federal $ 58,408 $ 56,342 $ 46,727 State 14,572 7,944 5,539 72,980 64,286 52,266 Deferred: Federal 6,046 10,433 9,010 State 679 236 (702 ) 6,725 10,669 8,308 Total $ 79,705 $ 74,955 $ 60,574 At December 31, 2015 and 2014, we had income taxes receivable of $23.8 million and $5.6 million, respectively, included as a component of other current assets in our Consolidated Balance Sheets. The reconciliation between amounts computed using the federal income tax rate of 35% and our income tax provision from continuing operations is shown in the following tabulation (in thousands): Year Ended December 31, 2015 2014 2013 Federal tax provision at statutory rate $ 91,947 $ 73,673 $ 58,026 State taxes, net of federal income tax benefit 9,357 6,526 3,141 Equity investment basis difference 11,048 1,422 — Non-deductible items 882 1,766 1,010 Permanent differences related to the employee stock purchase program 156 68 55 Net change in valuation allowance (3,303 ) (4,121 ) (554 ) General business credits (29,093 ) (4,002 ) (440 ) Other (1,289 ) (377 ) (664 ) Income tax provision $ 79,705 $ 74,955 $ 60,574 Deferred Taxes Individually significant components of the deferred tax assets and (liabilities) are presented below (in thousands): December 31, 2015 2014 Deferred tax assets: Deferred revenue and cancellation reserves $ 39,323 $ 31,539 Allowances and accruals, including state tax carryforward amounts 43,185 29,198 Interest on derivatives 206 678 Goodwill 2,581 2,668 Capital loss carryforward 10,414 10,711 Valuation allowance (5,360 ) (8,663 ) Total deferred tax assets 90,349 66,131 Deferred tax liabilities: Inventories (21,313 ) (19,356 ) Goodwill (31,258 ) (21,320 ) Property and equipment, principally due to differences in depreciation (84,355 ) (67,271 ) Prepaid expenses and other (6,552 ) (3,582 ) Total deferred tax liabilities (143,478 ) (111,529 ) Total $ (53,129 ) $ (45,398 ) We consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon future taxable income during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income and tax-planning strategies in making this assessment. As of December 31, 2015, we had a $5.4 million valuation allowance recorded associated with our deferred tax assets. The majority of this allowance is associated with capital losses from the sale of corporate entities in prior years. The valuation allowance decreased $3.3 million in the current year primarily as a result of our equity investment in a partnership with U.S. Bancorp Community Development Corporation. See also Note 18. As of December 31, 2015, we evaluated the availability of projected capital gains and determined that it continues to be unlikely the remaining capital loss carryforward would be fully utilized. We will continue to evaluate if it is more likely than not that we will realize the benefits of these deductible differences. However, additional valuation allowance amounts could be recorded in the future if estimates of taxable income during the carryforward period are reduced. At December 31, 2015, we had a number of state tax NOL carryforward amounts totaling approximately $2.0 million, tax effected, with expiration dates through 2035. We believe that it is more likely than not that the benefit from certain state NOL carryforward amounts will not be realized. In recognition of this risk, we have provided a valuation allowance of $2.0 million on the deferred tax assets relating to these state NOL carryforwards. Additionally, we have $2.2 million, tax effected, in state tax credit carryforwards with expiration dates through 2025. We believe it is more likely than not that the benefits from these state tax credit carryforwards will be realized. We early adopted the guidance, ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes (Topic 740)”, which simplifies the accounting for deferred taxes in a classified statement of financial position and requires all deferred taxes to be presented as non-current. Adoption of this guidance resulted in a reclassification of our net current deferred tax liability to the net non-current deferred tax liability in our Consolidated Balance Sheet as of December 31, 2015. No prior periods were retrospectively adjusted. Unrecognized Tax Benefits The following is a reconciliation of our unrecognized tax benefits (in thousands): Balance, December 31, 2013 $ — Acquired with acquisition 1,495 Balance, December 31, 2014 1,495 Decrease related to tax positions taken - prior year (464 ) Balance, December 31, 2015 $ 1,031 The unrecognized tax benefits recorded were acquired as part of the acquisition of DCH. We recorded a tax indemnification asset related to the unrecognized tax benefit as we determined the amount would be recoverable from the seller. Because we anticipate settlements and resulting cash payments related to the unrecognized tax benefits within the next twelve months, these amounts are included as a component of accrued liabilities in our Consolidated Balance Sheets. We did not have any activity during 2013 related to unrecognized tax benefits. Open tax years at December 31, 2015 included the following: Federal 2012 - 2015 18 states 2011 - 2015 |
Note 14 - Acquisitions
Note 14 - Acquisitions | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Business Combination Disclosure [Text Block] | (14) Acquisitions In 2015, we completed the following acquisitions: • On May 14, 2015, we acquired a smart franchise from Smart Center of Omaha. • On July 31, 2015, we acquired Bitterroot Ford in Missoula, Montana. • On August 20, 2015, we acquired Acura of Honolulu in Honolulu, Hawaii. • On September 28, 2015, we acquired Bennett Motors in Great Falls, Montana. • On October 12, 2015, we acquired Crown Chrysler Jeep Dodge Ram Fiat in Concord, California. • On December 17, 2015, we acquired Barton Chrysler Jeep Dodge Ram Alfa Fiat in Spokane, Washington. Revenue and operating income contributed by the 2015 acquisitions subsequent to the date of acquisition were as follows (in thousands): Year Ended December 31, 2015 Revenue $ 45,891 Operating income 23 In 2014, we completed the following acquisitions: • On January 31, 2014, we acquired Island Honda in Kahului, Hawaii. • On February 3, 2014, we acquired Stockton Volkswagen in Stockton, California. • On March 5, 2014, we acquired Honolulu Buick GMC Cadillac and Honolulu Volkswagen in Honolulu, Hawaii. • On April 1, 2014, we acquired Corpus Christi Ford in Corpus Christi, Texas. • On June 11, 2014, we acquired Beaverton GMC Buick and Portland Cadillac in Portland, Oregon. • On July 28, 2014, we acquired Bellingham GMC Buick in Bellingham, Washington. • On October 1, 2014, we completed the purchase of all of the issued and outstanding shares of the capital stock of DCH, which includes 27 stores located in New York, New Jersey and California. • On October 6, 2014, we acquired Harris Nissan in Clovis, California. All acquisitions were accounted for as business combinations under the acquisition method of accounting. The results of operations of the acquired stores are included in our Consolidated Financial Statements from the date of acquisition. The following table summarizes the consideration paid in cash and equity securities for our acquisitions and the amount of identified assets acquired and liabilities assumed as of the acquisition date (in thousands): Consideration paid for year ended December 31, 2015 DCH All other acquisitions Total 2014 Cash paid, net of cash acquired $ 71,615 $ 569,995 $ 89,639 $ 659,634 Forgiven outstanding note receivable 1,374 — — — Equity securities issued — 19,736 — 19,736 $ 72,989 $ 589,731 $ 89,639 $ 679,370 Assets acquired and liabilities assumed for year ended December 31, 2015 DCH All other acquisitions Total 2014 Trade receivables, net $ 36 $ 63,888 $ — $ 63,888 Inventories 34,374 265,378 48,662 314,040 Franchise value 6,843 72,856 7,377 80,233 Property and equipment 22,118 256,122 17,395 273,517 Other assets 224 20,313 531 20,844 Floor plan notes payable — (24,686 ) — (24,686 ) Debt and capital lease obligations (2,160 ) (52,532 ) (3,161 ) (55,693 ) Deferred taxes, net — (49,651 ) — (49,651 ) Other liabilities (2,537 ) (92,863 ) (123 ) (92,986 ) 58,898 458,825 70,681 529,506 Goodwill 14,091 130,906 18,958 149,864 $ 72,989 $ 589,731 $ 89,639 $ 679,370 We account for franchise value as an indefinite-lived intangible asset. We expect $14.1 million of the goodwill recognized in 2015 to be deductible for tax purposes. In 2014, we recorded $1.9 million in acquisition expenses as a component of selling, general and administrative expenses in the Consolidated Statements of Operations. We did not have any material acquisition-related expenses in 2015 or 2013. The following unaudited pro forma summary presents consolidated information as if the acquisitions had occurred on January 1 of the previous year (in thousands, except for per share amounts): Year Ended December 31, 2015 2014 Revenue $ 7,999,256 $ 7,333,480 Income from continuing operations, net of tax 182,131 147,975 Basic income per share from continuing operations, net of tax 6.93 5.66 Diluted income per share from continuing operations, net of tax 6.88 5.61 These amounts have been calculated by applying our accounting policies and estimates. The results of the acquired stores have been adjusted to reflect the following: depreciation on a straight-line basis over the expected lives for property, plant and equipment; accounting for inventory on a specific identification method; and recognition of interest expense for real estate financing related to stores where we purchased the facility. No nonrecurring pro forma adjustments directly attributable to the acquisitions are included in the reported pro forma revenues and earnings. |
Note 15 - Discontinued Operatio
Note 15 - Discontinued Operations and Assets and Related Liabilities Held for Sale | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | (15) Discontinued Operations and Assets and Related Liabilities Held for Sale We classify an asset group as held for sale if the location has been sold, we have ceased operations at that location or the store meets the criteria required by U.S. generally accepted accounting standards as follows: • our management team, possessing the necessary authority, commits to a plan to sell the store; • the store is available for immediate sale in its present condition; • an active program to locate buyers and other actions that are required to sell the store are initiated; • a market for the store exists and we believe its sale is likely within one year; • active marketing of the store commences at a price that is reasonable in relation to the estimated fair market value; and • our management team believes it is unlikely changes will be made to the plan or the plan to dispose of the store will be withdrawn. In April 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that amended the accounting guidance related to discontinued operations. This amendment defines discontinued operations as a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has or will have a major effect on an entity’s operations and financial results. We early adopted this guidance in September 2014 and, as a result, determined that individual stores which met the criteria for held for sale after our adoption date would no longer qualify for classification as discontinued operations. We had previously reclassified a store’s operations to discontinued operations in our Consolidated Statements of Operations, on a comparable basis for all periods presented, provided we did not expect to have any significant continuing involvement in the store’s operations after its disposal. On May 1, 2014, we completed the sale of one store which had been classified as held for sale since October 2012. This store’s operations have been reclassified to discontinued operations in our Consolidated Statement of Operations, on a comparable basis for all periods presented. As of December 31, 2014, we had two stores classified as held for sale. We did not have any stores classified as held for sale as of December 31, 2015. Assets held for sale included the following (in thousands): December 31, 2015 2014 Inventories $ — $ 6,284 Property, plant and equipment — 1,739 Intangible assets — 540 $ — $ 8,563 Liabilities related to assets held for sale included the following (in thousands): December 31, 2015 2014 Floor plan notes payable $ — $ 4,892 Actual floor plan interest expense for a store classified as discontinued operations is directly related to the store’s new vehicles. Interest expense related to our used vehicle inventory financing and revolving line of credit is allocated based on the working capital level of the store. Interest expense included as a component of discontinued operations was as follows (in thousands): Year Ended December 31, 2015 2014 2013 Floor plan interest $ — $ 32 $ 117 Other interest — 8 21 Total interest $ — $ 40 $ 138 Certain financial information related to discontinued operations was as follows (in thousands): Year Ended December 31, 2015 2014 2013 Revenue $ — $ 12,569 $ 38,978 Pre-tax gain (loss) from discontinued operations $ — $ (467 ) $ 1,310 Net gain on disposal activities — 5,744 — 5,277 1,310 Income tax expense — (2,097 ) (524 ) Income from discontinued operations, net of income tax expense $ — $ 3,180 $ 786 Goodwill and other intangible assets disposed of $ — $ 211 $ — The net gain on disposal activities in 2014 included a $6.8 million gain related to the disposal of goodwill and other intangible assets. |
Note 16 - Related Party Transac
Note 16 - Related Party Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | (16) Related Party Transactions Transition Agreement In September 2015, we entered into a transition agreement with Sidney B. DeBoer, our Executive Chairman, which provides him certain benefits until his death. The agreement has an effective date of January 1, 2016 with the initial payment of these benefits beginning in the third quarter of 2016. We recorded a charge of $18.3 million in 2015 as a component of selling, general and administrative expense in our Consolidated Statement of Operations related to the present value of estimated future payments due pursuant to this agreement. We believe that this estimate is reasonable; however, actual cash flows could differ materially. We will periodically evaluate whether significant changes in our assumptions have occurred and record an adjustment if future expected cash flows are significantly different than the reserve recorded. As of December 31, 2015, the balance associated with this agreement was $18.3 million and was included as a component of accrued liabilities and other long-term liabilities in our Consolidated Balance Sheets. Sale of Land In the fourth quarter of 2013, we completed the sale of land in Medford, Oregon to Dick Heimann for $4.2 million. Mr. Heimann relocated stores he purchased from us in 2012 to this location. We determined the fair value of the land based on a third party appraisal for the property. The sale resulted in a gain of $2.5 million, recorded as a component of selling, general and administrative expenses in our Consolidated Statements of Operations. |
Note 17 - Net Income Per Share
Note 17 - Net Income Per Share of Class A and Class B Common Stock | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | (17) Net Income Per Share of Class A and Class B Common Stock We compute net income per share of Class A and Class B common stock using the two-class method. Under this method, basic net income per share is computed using the weighted average number of common shares outstanding during the period excluding unvested common shares subject to repurchase or cancellation. Diluted net income per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and unvested restricted shares subject to repurchase or cancellation. The dilutive effect of outstanding stock options and other grants is reflected in diluted earnings per share by application of the treasury stock method. The computation of the diluted net income per share of Class A common stock assumes the conversion of Class B common stock, while the diluted net income per share of Class B common stock does not assume the conversion of those shares. Except with respect to voting and transfer rights, the rights of the holders of our Class A and Class B common stock are identical. Our Restated Articles of Incorporation require that the Class A and Class B common stock must share equally in any dividends, liquidation proceeds or other distribution with respect to our common stock and the Articles of Incorporation can only be amended by a vote of the stockholders. Additionally, Oregon law provides that amendments to our Articles of Incorporation, which would have the effect of adversely altering the rights, powers or preferences of a given class of stock, must be approved by the class of stock adversely affected by the proposed amendment. As a result, the undistributed earnings for each year are allocated based on the contractual participation rights of the Class A and Class B common shares as if the earnings for the year had been distributed. Because the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis. Following is a reconciliation of the income from continuing operations and weighted average shares used for our basic earnings per share (“EPS”) and diluted EPS (in thousands, except per share amounts): Year Ended December 31, 2015 2014 2013 Basic EPS Class A Class B Class A Class B Class A Class B Numerator: Income from continuing operations applicable to common stockholders $ 165,172 $ 17,827 $ 122,246 $ 13,294 $ 94,532 $ 10,682 Distributed income applicable to common stockholders (18,038 ) (1,947 ) (14,367 ) (1,562 ) (9,061 ) (1,024 ) Basic undistributed income from continuing operations applicable to common stockholders $ 147,134 $ 15,880 $ 107,879 $ 11,732 $ 85,471 $ 9,658 Denominator: Weighted average number of shares out-standing used to calculate basic income per share 23,729 2,561 23,559 2,562 23,185 2,620 Basic income from continuing operations per share applicable to common stockholders $ 6.96 $ 6.96 $ 5.19 $ 5.19 $ 4.08 $ 4.08 Basic distributed income per share applicable to common stockholders (0.76 ) (0.76 ) (0.61 ) (61 ) (0.39 ) (0.39 ) Basic undistributed income from continuing operations per share applicable to common stockholders $ 6.20 $ 6.20 $ 4.58 $ 4.58 $ 3.69 $ 3.69 Year Ended December 31, 2015 2014 2013 Diluted EPS Class A Class B Class A Class B Class A Class B Numerator: Distributed income applicable to common stockholders $ 18,038 $ 1,947 $ 14,367 $ 1,562 $ 9,061 $ 1,024 Reallocation of distributed income as a result of conversion of dilutive stock options 15 (15 ) 15 (15 ) 15 (15 ) Reallocation of distributed income due to conversion of Class B to Class A 1,932 — 1,547 — 1,009 — Diluted distributed income applicable to common stockholders $ 19,985 $ 1,932 $ 15,929 $ 1,547 $ 10,085 $ 1,009 Undistributed income from continuing operations applicable to common stockholders $ 147,134 $ 15,880 $ 107,879 $ 11,732 $ 85,471 $ 9,658 Reallocation of undistributed income as a result of conversion of dilutive stock options 120 (120 ) 116 (116 ) 142 (142 ) Reallocation of undistributed income due to conversion of Class B to Class A 15,760 — 11,616 — 9,516 — Diluted undistributed income from continuing operations applicable to common stockholders $ 163,014 $ 15,760 $ 119,611 $ 11,616 $ 95,129 $ 9,516 Denominator: Weighted average number of shares outstanding used to calculate basic income per share 23,729 2,561 23,559 2,562 23,185 2,620 Weighted average number of shares from stock options 200 — 261 — 386 — Conversion of Class B to Class A 2,561 — 2,562 — 2,620 — Weighted average number of shares outstanding used to calculate diluted income per share 26,490 2,561 26,382 2,562 26,191 2,620 Year Ended December 31, 2015 2014 2013 Diluted EPS Class A Class B Class A Class B Class A Class B Diluted income from continuing operations per share available to common stockholders $ 6.91 $ 6.91 $ 5.14 $ 5.14 $ 4.02 $ 4.02 Diluted distributed income from continuing operations per share applicable to common stockholders (0.76 ) (0.76 ) (0.61 ) (0.61 ) (0.39 ) (0.39 ) Diluted undistributed income from continuing operations per share applicable to common stockholders $ 6.15 $ 6.15 $ 4.53 $ 4.53 $ 3.63 $ 3.63 Antidilutive Securities: Shares issuable pursuant to stock options not included since they were antidilutive 16 — 13 — 16 — |
Note 18 - Equity-method Investm
Note 18 - Equity-method Investment | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | (18) Equity-Method Investment In October 2014, we acquired a 99.9% membership interest in a limited liability company managed by U.S. Bancorp Community Development Corporation with an initial equity contribution of $4.1 million. We made additional equity contributions to the entity of $22.8 million in 2015. We are obligated to make $49.8 million of total contributions to the entity over a two-year period ending October 2016, $26.9 million of which had been made as of December 31, 2015. This investment generates new markets tax credits under the New Markets Tax Credit Program (“NMTC Program”). The NMTC Program was established by Congress in 2000 to spur new or increased investments into operating businesses and real estate projects located in low-income communities. While U.S. Bancorp Community Development Corporation exercises management control over the limited liability company, due to the economic interest we hold in the entity, we determined our ownership portion of the entity was appropriately accounted for using the equity method. The following amounts related to this equity-method investment were recorded in our Consolidated Balance Sheets (in thousands): December 31, 2015 2014 Carrying value, recorded as a component of other non-current assets $ 22,284 $ 33,282 Present value of obligation associated with future equity contributions, recorded as a component of accrued liabilities and other long-term liabilities 22,511 32,177 The following amounts related to this equity-method investment were recorded in our Consolidated Statements of Operations (in thousands): Year Ended December 31, 2015 2014 2013 Asset impairments to write investment down to fair value $ 16,521 $ 1,853 $ — Our portion of the partnership’s operating losses 6,929 1,160 — Non-cash interest expense related to the amortization of the discounted fair value of future equity contributions 674 152 — Tax benefits and credits generated 30,832 6,506 — |
Note 19 - Segments
Note 19 - Segments | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | (19) Segments Certain financial information on a segment basis is as follows (in thousands): Year Ended December 31, 2015 2014 2013 Revenues: Domestic $ 3,034,849 $ 2,566,473 $ 2,145,478 Import 3,334,983 1,893,034 1,225,800 Luxury 1,490,632 926,856 629,521 7,860,464 5,386,363 4,000,799 Corporate and other 3,788 3,963 4,950 $ 7,864,252 $ 5,390,326 $ 4,005,749 Segment income*: Domestic $ 115,525 $ 96,888 $ 84,500 Import 98,371 50,870 40,264 Luxury 36,391 25,448 16,133 250,287 173,206 140,897 Corporate and other 74,514 71,195 50,283 Depreciation and amortization (41,600 ) (26,363 ) (20,035 ) Other interest expense (19,491 ) (10,742 ) (8,350 ) Other (expense) income, net (1,006 ) 3,199 2,993 Income from continuing operations before income taxes $ 262,704 $ 210,495 $ 165,788 *Segment income for each of the segments is defined as Income from continuing operations before income taxes, depreciation and amortization, other interest expense and other (expense) income, net. Floor plan interest expense: Domestic $ 20,970 $ 17,852 $ 15,223 Import 15,051 9,439 6,475 Luxury 9,096 5,098 3,931 45,117 32,389 25,629 Corporate and other (25,583 ) (18,528 ) (13,256 ) $ 19,534 $ 13,861 $ 12,373 December 31, 2015 2014 Total assets: Domestic $ 985,374 $ 829,721 Import 725,011 698,015 Luxury 475,305 405,222 Corporate and other 1,041,609 947,974 $ 3,227,299 $ 2,880,932 |
Note 20 - Recent Accounting Pro
Note 20 - Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | (20) Recent Accounting Pronouncements In May 2014, the FASB issued accounting standards update (“ASU”) 2014-09, “Revenue from Contracts with Customers,” which amends the accounting guidance related to revenues. This amendment will replace most of the existing revenue recognition guidance when it becomes effective. The new standard, as amended in July 2015, is effective for fiscal years beginning after December 15, 2017 and entities are allowed to adopt the standard as early as annual periods beginning after December 15, 2016, and interim periods therein. The standard permits the use of either the retrospective or cumulative effect transition method. We are evaluating the effect this amendment will have on our consolidated financial statements and related disclosures and believe the financial impact is not material. We have not yet selected a transition method. In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” ASU 2015-11 simplifies the accounting for the valuation of all inventory not accounted for using the last-in, first-out method by prescribing inventory be valued at the lower of cost and net realizable value. ASU 2015-11 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016 on a prospective basis. Early adoption is permitted. We do not expect the adoption of ASU 2015-11 to have a material effect on our financial position, results of operations or cash flows. In September 2015, the FASB issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments.” This guidance eliminated the requirement for retrospective adjustments to financial statements for measurement-period adjustments that occur after a business combination is consummated. ASU 2015-16 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2015 on a prospective basis. Early adoption is permitted. We do not expect the adoption of ASU 2015-16 to have any effect on our financial position, results of operations or cash flows. |
Note 21 - Subsequent Events
Note 21 - Subsequent Events | 12 Months Ended |
Dec. 31, 2015 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | (21) Subsequent Events Common Stock Dividend On February 22, 2016, our Board of Directors approved a dividend of $0.20 per share on our Class A and Class B common stock related to our fourth quarter 2015 financial results. The dividend will total approximately $5.1 million and will be paid on March 25, 2016 to shareholders of record on March 11, 2016. Repurchases of Class A Common Stock In 2016 to date, we have repurchased approximately 594,123 shares at a weighted average price of $79.11 per share. As of February 26, 2016, under our existing share repurchase authorization, approximately 677,364 shares remain available for purchase. Acquisitions On January 26, 2016, we acquired the inventory, equipment and intangible assets of Riverside Subaru in Riverside, California. We paid $3.6 million in cash for this acquisition. On February 1, 2016, we acquired the inventory, equipment and intangible assets of Ira Toyota / Scion of Milford, Massachusetts. We paid $6.5 million in cash for this acquisition. Litigation Jessos v. DeBoer, et al. Stein |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying Consolidated Financial Statements reflect the results of operations, the financial position and the cash flows for Lithia Motors, Inc. and its directly and indirectly wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash and cash equivalents are defined as cash on hand and cash in bank accounts without restrictions. |
Receivables, Policy [Policy Text Block] | Accounts Receivable Accounts receivable include amounts due from the following: • various lenders for the financing of vehicles sold; • customers for vehicles sold and service and parts sales; • manufacturers for factory rebates, dealer incentives and warranty reimbursement; and • insurance companies and other miscellaneous receivables. Receivables are recorded at invoice and do not bear interest until they are 60 days past due. The allowance for doubtful accounts represents an estimate of the amount of net losses inherent in our portfolio of accounts receivable as of the reporting date. We estimate an allowance for doubtful accounts based on our historical write-off experience and consider recent delinquency trends and recovery rates. Account balances are charged against the allowance after all appropriate means of collection have been exhausted and the potential for recovery is considered remote. The annual activity for charges and subsequent recoveries is immaterial. See Note 2. |
Inventory, Policy [Policy Text Block] | Inventories Inventories are valued at the lower of market value or cost, using a pooled approach for vehicles and the specific identification method for parts. Certain acquired inventories are valued using the last-in first-out (LIFO) method. The LIFO reserve associated with this inventory as of December 31, 2015 and 2014 was immaterial. The cost of new and used vehicle inventories includes the cost of any equipment added, reconditioning and transportation. Manufacturers reimburse us for holdbacks, floor plan interest assistance and advertising assistance, which are reflected as a reduction in the carrying value of each vehicle purchased. We recognize advertising assistance, floor plan interest assistance, holdbacks, cash incentives and other rebates received from manufacturers that are tied to specific vehicles as a reduction to cost of sales as the related vehicles are sold. Parts are valued at lower of market value or cost using a specific identification method. Parts purchase discounts that we receive from the manufacturer are reflected as a reduction in the carrying value of the parts purchased from the manufacturer and are recognized as a reduction to cost of goods sold as the related inventory is sold. See Note 3. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment are stated at cost and depreciated over their estimated useful lives on the straight-line basis. Leasehold improvements made at the inception of the lease or during the term of the lease are amortized on a straight-line basis over the shorter of the life of the improvement or the remaining term of the lease. The range of estimated useful lives is as follows: Buildings and improvements (in years) 5 to 40 Service equipment (in years) 5 to 15 Furniture, office equipment, signs and fixtures (in years) 3 to 10 The cost for maintenance, repairs and minor renewals is expensed as incurred, while significant remodels and betterments are capitalized. In addition, interest on borrowings for major capital projects, significant remodels and betterments are capitalized. Capitalized interest becomes a part of the cost of the depreciable asset and is depreciated according to the estimated useful lives as previously stated. For the years ended December 31, 2015, 2014 and 2013, we recorded capitalized interest of $0.5 million, $0.4 million and $0.1 million, respectively. When an asset is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts, and any gain or loss is credited or charged to income from continuing operations. Leased property meeting certain criteria is capitalized and the present value of the related lease payments is recorded as a liability. Amortization of capitalized leased assets is computed on a straight-line basis over the term of the lease, unless the lease transfers title or it contains a bargain purchase option, in which case, it is amortized over the asset’s useful life, and is included in depreciation expense. Long-lived assets held and used by us are reviewed for impairment whenever events or circumstances indicate that the carrying amount of assets may not be recoverable. We consider several factors when evaluating whether there are indications of potential impairment related to our long-lived assets, including store profitability, overall macroeconomic factors and the impact of our strategic management decisions. If recoverability testing is performed, we evaluate assets to be held and used by comparing the carrying amount of an asset to future net undiscounted cash flows associated with the asset, including its disposition. If such assets are considered to be impaired, the amount by which the carrying amount of the assets exceeds the fair value of the assets is recognized as a charge to income from continuing operations. See Note 4. |
Goodwill and Intangible Assets, Intangible Assets, Indefinite-Lived, Policy [Policy Text Block] | Franchise Value We enter into agreements (“Franchise Agreements”) with the manufacturers. Franchise value represents a right received under Franchise Agreements with manufacturers and is identified on an individual store basis. We evaluated the useful lives of our Franchise Agreements based on the following factors: • certain of our Franchise Agreements continue indefinitely by their terms; • certain of our Franchise Agreements have limited terms, but are routinely renewed without substantial cost to us; • other than franchise terminations related to the unprecedented reorganizations of Chrysler and General Motors, and allowed by bankruptcy law, we are not aware of manufacturers terminating Franchise Agreements against the wishes of the franchise owners in the ordinary course of business. A manufacturer may pressure a franchise owner to sell a franchise when the owner is in breach of the franchise agreement over an extended period of time; • state dealership franchise laws typically limit the rights of the manufacturer to terminate or not renew a franchise; • we are not aware of any legislation or other factors that would materially change the retail automotive franchise system; and • as evidenced by our acquisition and disposition history, there is an active market for most automotive dealership franchises within the United States. We attribute value to the Franchise Agreements acquired with the dealerships we purchase based on the understanding and industry practice that the Franchise Agreements will be renewed indefinitely by the manufacturer. Accordingly, we have determined that our Franchise Agreements will continue to contribute to our cash flows indefinitely and, therefore, have indefinite lives. As an indefinite-lived intangible asset, franchise value is tested for impairment at least annually, and more frequently if events or circumstances indicate the carrying value may exceed fair value. The impairment test for indefinite-lived intangible assets requires the comparison of estimated fair value to carrying value. An impairment charge is recorded to the extent the fair value is less than the carrying value. We have the option to qualitatively or quantitatively assess indefinite-lived intangible assets for impairment. We evaluated our indefinite-lived intangible assets using a quantitative assessment process. We have determined the appropriate reporting unit for testing franchise value for impairment is each individual store. We test our franchise value for impairment on October 1 of each year. The quantitative assessment uses a multi-period excess earnings (“MPEE”) model to estimate the fair value of our franchises. We have determined that only certain cash flows of the store are directly attributable to franchise rights. Future cash flows are based on recently prepared operating forecasts and business plans to estimate the future economic benefits that the store will generate. Operating forecasts and cash flows include estimated revenue growth rates that are calculated based on management’s forecasted sales projections and on the U.S. Department of Labor, Bureau of Labor Statistics for historical consumer price index data. Additionally, we use a contributory asset charge to represent working capital, personal property and assembled workforce costs. A discount rate is utilized to convert the forecasted cash flows to their present value equivalent. The discount rate applied to the future cash flows factors an equity market risk premium, small stock risk premium, an average peer group beta and a risk-free interest rate. See Note 5. |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill Goodwill represents the excess purchase price over the fair value of net assets acquired which is not allocable to separately identifiable intangible assets. Other identifiable intangible assets, such as franchise rights, are separately recognized if the intangible asset is obtained through contractual or other legal right or if the intangible asset can be sold, transferred, licensed or exchanged. Goodwill is not amortized but tested for impairment at least annually, and more frequently if events or circumstances indicate the carrying value of the reporting unit more likely than not exceeds fair value. We have the option to qualitatively or quantitatively assess goodwill for impairment and we evaluated our goodwill using a quantitative assessment process. Goodwill is tested for impairment at the reporting unit level. Our reporting units are individual stores as this is the level at which discrete financial information is available and for which operating results are regularly reviewed by our chief operating decision maker to allocate resources and assess performance. We test our goodwill for impairment on October 1 of each year. We used an Adjusted Present Value (“APV”) method, a fair-value based test, to indicate the fair value of our reporting units. Under the APV method, future cash flows based on recently prepared operating forecasts and business plans are used to estimate the future economic benefits generated by the reporting unit. Operating forecasts and cash flows include estimated revenue growth rates based on management’s forecasted sales projections and on U.S. Department of Labor, Bureau of Labor Statistics for historical consumer price index data. A discount rate is utilized to convert the forecasted cash flows to their present value equivalent representing the indicated fair value of our reporting unit. The discount rate applied to the future cash flows factors an equity market risk premium, small stock risk premium, an average peer group beta and a risk-free interest rate. We compare the indicated fair value of our reporting unit to our market capitalization, including consideration of a control premium. The control premium represents the estimated amount an investor would pay to obtain a controlling interest. We believe this reconciliation is consistent with a market participant perspective. The quantitative impairment test of goodwill is a two-step process. The first step identifies potential impairment by comparing the estimated fair value of a reporting unit with its book value. If the fair value of the reporting unit exceeds the carrying amount, goodwill is not impaired and the second step is not necessary. If the carrying value exceeds the fair value, the second step includes determining the implied fair value in the same manner as the amount of goodwill recognized in a business combination is determined. The implied fair value of goodwill is then compared with the carrying amount of goodwill to determine if an impairment loss is necessary. See Note 5. |
Equity Method Investments, Policy [Policy Text Block] | Equity-Method Investments We own investments in certain partnerships which we account for under the equity method. These investments are included as a component of other non-current assets in our Consolidated Balance Sheets. We determined that we lack certain characteristics to direct the operations of the businesses and, as a result, do not qualify to consolidate these investments. Activity related to our equity-method investments is recognized in our Consolidated Statements of Operations as follows: • an other than temporary decline in fair value is reflected as an asset impairment; • our portion of the operating gains and losses is included as a component of other income, net; • the amortization related to the discounted fair value of future equity contributions is recognized over the life of the investments as non-cash interest expense; and • tax benefits and credits are reflected as a component of income tax provision. Periodically, whenever events or circumstances indicate that the carrying amount of assets may be impaired, we evaluate the equity-method investments for indications of loss resulting from an other than temporary decline. If the equity-method investment is determined to be impaired, the amount by which the investment basis exceeds the fair value of the investment is recognized as a charge to income from continuing operations. See Notes 12 and 18. |
Advertising Costs, Policy [Policy Text Block] | Advertising We expense production and other costs of advertising as incurred as a component of selling, general and administrative expense. Additionally, manufacturer cooperative advertising credits for qualifying, specifically-identified advertising expenditures are recognized as a reduction of advertising expense. Advertising expense and manufacturer cooperative advertising credits were as follows (in thousands): Year Ended December 31, 2015 2014 2013 Advertising expense, gross $ 89,736 $ 62,933 $ 51,404 Manufacturer cooperative advertising credits (19,801 ) (16,281 ) (11,806 ) Advertising expense, net $ 69,935 $ 46,652 $ 39,598 |
Contract Origination Costs Policy [Policy Text Block] | Contract Origination Costs Contract origination commissions paid to our employees directly related to the sale of our self-insured lifetime lube, oil and filter service contracts are deferred and charged to expense in proportion to the associated revenue to be recognized. |
Legal Costs, Policy [Policy Text Block] | Legal Costs We are a party to numerous legal proceedings arising in the normal course of business. We accrue for certain legal costs, including attorney fees and potential settlement claims related to various legal proceedings that are estimable and probable. See Note 7. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation Compensation costs associated with equity instruments exchanged for employee and director services are measured at the grant date, based on the fair value of the award, with estimated forfeitures considered, and recognized as an expense on the straight-line basis over the individual’s requisite service period (generally the vesting period of the equity award). If there is a performance-based element to the award, the expense is recognized based on the estimated attainment level, estimated time to achieve the attainment level and/or the vesting period. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by persons who receive equity awards. The fair value of non-vested stock awards is based on the intrinsic value on the date of grant. See Note 10. Shares to be issued upon the exercise of stock options and the vesting of stock awards will come from newly issued shares. |
Income Tax, Policy [Policy Text Block] | Income and Other Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance, if needed, reduces deferred tax assets when it is more likely than not that some or all of the deferred tax assets will not be realized. When there are situations with uncertainty as to the timing of the deduction, the amount of the deduction, or the validity of the deduction, we adjust our financial statements to reflect only those tax positions that are more-likely-than-not to be sustained. Positions that meet this criterion are measured using the largest benefit that is more than 50% likely to be realized. Interest and penalties are recorded as income tax provision in the period incurred or accrued when related to an uncertain tax position. See Note 13. We account for all taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction (i.e., sales, use, value-added) on a net (excluded from revenues) basis. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentration of Risk and Uncertainties We purchase substantially all of our new vehicles and inventory from various manufacturers at the prevailing prices charged by auto makers to all franchised dealers. Our overall sales could be impacted by the auto manufacturers’ inability or unwillingness to supply dealerships with an adequate supply of popular models. We depend on our manufacturers to provide a supply of vehicles which supports expected sales levels. In the event that manufacturers are unable to supply the needed level of vehicles, our financial performance may be adversely impacted. We depend on our manufacturers to deliver high-quality, defect-free vehicles. In the event that manufacturers experience future quality issues, our financial performance may be adversely impacted. We are subject to a concentration of risk in the event of financial distress, including potential reorganization or bankruptcy, of a major vehicle manufacturer. Our sales volume could be materially adversely impacted by the manufacturers’ or distributors’ inability to supply the stores with an adequate supply of vehicles. We also receive incentives and rebates from our manufacturers, including cash allowances, financing programs, discounts, holdbacks and other incentives. These incentives are recorded as accounts receivable in our Consolidated Balance Sheets until payment is received. Our financial condition could be materially adversely impacted by the manufacturers’ or distributors’ inability to continue to offer these incentives and rebates at substantially similar terms, or to pay our outstanding receivables. We enter into Franchise Agreements with the manufacturers. The Franchise Agreements generally limit the location of the dealership and provide the auto manufacturer approval rights over changes in dealership management and ownership. The auto manufacturers are also entitled to terminate the Franchise Agreement if the dealership is in material breach of the terms. Our ability to expand operations depends, in part, on obtaining consents of the manufacturers for the acquisition of additional dealerships. See also “Goodwill” and “Franchise Value” above. We have a credit facility with a syndicate of 18 financial institutions, including eight manufacturer-affiliated finance companies. Several of these financial institutions also provide mortgage financing. This credit facility is the primary source of floor plan financing for our new vehicle inventory and also provides used vehicle financing and a revolving line of credit. The term of the facility extends through January 2021. At maturity, our financial condition could be materially adversely impacted if lenders are unable to provide credit that has typically been extended to us or with terms unacceptable to us. Our financial condition could be materially adversely impacted if these providers incur losses in the future or undergo funding limitations. See Note 6. We anticipate continued organic growth and growth through acquisitions. This growth will require additional credit which may be unavailable or with terms unacceptable to us. If these events were to occur, we may not be able to borrow sufficient funds to facilitate our growth. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Financial Instruments, Fair Value and Market Risks The carrying amounts of cash equivalents, accounts receivable, trade payables, accrued liabilities and short-term borrowings approximate fair value because of the short-term nature and current market rates of these instruments. Fair value estimates are made at a specific point in time, based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. See Note 12. We have variable rate floor plan notes payable, mortgages and other credit line borrowings that subject us to market risk exposure. At December 31, 2015, we had $1.6 billion outstanding in variable rate debt. These borrowings had interest rates ranging from 1.49% to 3.00% per annum. An increase or decrease in the interest rates would affect interest expense for the period accordingly. The fair value of long-term, fixed interest rate debt is subject to interest rate risk. Generally, the fair value of fixed interest rate debt will increase as interest rates fall because we could refinance for a lower rate. Conversely, the fair value of fixed interest rate debt will decrease as interest rates rise. The interest rate changes affect the fair value, but do not impact earnings or cash flows. We monitor our fixed interest rate debt regularly, refinancing debt that is materially above market rates if permitted. See Note 12. We are also subject to market risk from changing interest rates. From time to time, we reduce our exposure to this market risk by entering into interest rate swaps and designating the swaps as cash flow hedges. We are generally exposed to credit or repayment risk based on our relationship with the counterparty to the derivative financial instrument. We minimize the credit or repayment risk on our derivative instruments by entering into transactions with institutions whose credit rating is Aa or higher. See Note 11. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and related notes to financial statements. Changes in such estimates may affect amounts reported in future periods. Estimates are used in the calculation of certain reserves maintained for charge-backs on estimated cancellations of service contracts; life, accident and disability insurance policies; finance fees from customer financing contracts and uncollectible accounts receivable. We also use estimates in the calculation of various expenses, accruals and reserves, including anticipated losses related to workers’ compensation insurance; anticipated losses related to self-insurance components of our property and casualty and medical insurance; self-insured lifetime lube, oil and filter service contracts; discretionary employee bonuses, the Transition Agreement with Sidney B. DeBoer, our Executive Chairman; warranties provided on certain products and services; legal reserves and stock-based compensation. We also make certain estimates regarding the assessment of the recoverability of long-lived assets, indefinite-lived intangible assets and deferred tax assets. We offer a limited warranty on the sale of most retail used vehicles. This warranty is based on mileage and time. We also offer a mileage and time based warranty on parts used in our service repair work and on tire purchases. The cost that may be incurred for these warranties is estimated at the time the related revenue is recorded. A reserve for these warranty liabilities is estimated based on current sales levels, warranty experience rates and estimated costs per claim. The annual activity for reserve increases and claims is immaterial. As of December 31, 2015 and 2014, the accrued warranty balance was $0.5 million and $0.4 million, respectively. |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value of Assets Acquired and Liabilities Assumed We estimate the fair value of the assets acquired and liabilities assumed in a business combination using various assumptions. The most significant assumptions used relate to determining the fair value of property and equipment and intangible franchise rights. We estimate the fair value of property and equipment based on a market valuation approach. We use prices and other relevant information generated primarily by recent market transactions involving similar or comparable assets, as well as our historical experience in divestitures, acquisitions and real estate transactions. Additionally, we may use a cost valuation approach to value long-lived assets when a market valuation approach is unavailable. Under this approach, we determine the cost to replace the service capacity of an asset, adjusted for physical and economic obsolescence. When available, we use valuation inputs from independent valuation experts, such as real estate appraisers and brokers, to corroborate our estimates of fair value. We use an MPEE model to determine the fair value of intangible franchise rights as discussed above under “Franchise Value.” We use a relief-from-royalty method to determine the fair value of a trade name. Future cost savings associated with owning, rather than licensing, a trade name is estimated based on a royalty rate and management’s forecasted sales projections. The discount rate applied to the future cost savings factors an equity market risk premium, small stock risk premium, an average peer group beta, a risk-free interest rate and a premium for forecast risk. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition Revenue from the sale of a vehicle is recognized when a contract is signed by the customer, financing has been arranged or collectability is reasonably assured and the delivery of the vehicle to the customer is made. We do not allow the return of new or used vehicles, except where mandated by state law. Revenue from parts and service is recognized upon delivery of the parts or service to the customer. We allow for customer returns on sales of our parts inventory up to 30 days after the sale. Most parts returns generally occur within one to two weeks from the time of sale, and are not significant. Finance fees earned for notes placed with financial institutions in connection with customer vehicle financing are recognized, net of estimated charge-backs, as finance and insurance revenue upon acceptance of the credit by the financial institution and recognition of the sale of the vehicle. Insurance income from third party insurance companies for commissions earned on credit life, accident and disability insurance policies sold in connection with the sale of a vehicle are recognized, net of anticipated cancellations, as finance and insurance revenue upon execution of the insurance contract and recognition of the sale of the vehicle. Commissions from third party service contracts are recognized, net of anticipated cancellations, as finance and insurance revenue upon sale of the contracts and recognition of the sale of the vehicle. We also participate in future underwriting profit, pursuant to retrospective commission arrangements, which is recognized in income as earned. Revenue related to self-insured lifetime lube, oil and filter service contracts is deferred and recognized based on expected future claims for service. The expected future claims experience is evaluated periodically to ensure it remains appropriate given actual claims history. |
Segment Reporting, Policy [Policy Text Block] | Segment Reporting While we have determined that each individual store is a reporting unit, we have aggregated our reporting units into three reportable segments based on their economic similarities: Domestic, Import and Luxury. Our Domestic segment is comprised of retail automotive franchises that sell new vehicles manufactured by Chrysler, General Motors and Ford. Our Import segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by Honda, Toyota, Subaru, Nissan and Volkswagen. Our Luxury segment is comprised of retail automotive franchises that sell new vehicles manufactured primarily by BMW, Mercedes-Benz and Lexus. The franchises in each segment also sell used vehicles, parts and automotive services, and automotive finance and insurance products. Corporate and other revenue and income includes the results of operations of our stand-alone collision center offset by unallocated corporate overhead expenses, such as corporate personnel costs, and certain unallocated reserve and elimination adjustments. Additionally, certain internal corporate expense allocations increase segment income for Corporate and other while decreasing segment income for the other reportable segments. These internal corporate expense allocations are used to increase comparability of our dealerships and reflect the capital burden a stand-alone dealership would experience. Examples of these internal allocations include internal rent expense, internal floor plan financing charges, and internal fees charged to offset employees within our corporate headquarters that perform certain dealership functions. We define our chief operating decision maker (“CODM”) to be certain members of our executive management group. Historical and forecasted operational performance is evaluated on a store-by-store basis and on a consolidated basis by the CODM. We derive the operating results of the segments directly from our internal management reporting system. The accounting policies used to derive segment results are substantially the same as those used to determine our consolidated results, excepted for the internal allocation within Corporate and other discussed above. Our CODM measures the performance of each operating segment based on several metrics, including earnings from operations, and uses these results, in part, to evaluate the performance of, and to allocate resources to, each of the operating segments. See Note 19. |
Note 1 - Summary of Significa32
Note 1 - Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Property Plant and Equipment, Estimated Useful Lives [Table Text Block] | Buildings and improvements (in years) 5 to 40 Service equipment (in years) 5 to 15 Furniture, office equipment, signs and fixtures (in years) 3 to 10 |
Advertising Expense, and Cooperative Advertising Credits [Table Text Block] | Year Ended December 31, 2015 2014 2013 Advertising expense, gross $ 89,736 $ 62,933 $ 51,404 Manufacturer cooperative advertising credits (19,801 ) (16,281 ) (11,806 ) Advertising expense, net $ 69,935 $ 46,652 $ 39,598 |
Note 2 - Accounts Receivable (T
Note 2 - Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | December 31, 2015 2014 Contracts in transit $ 168,460 $ 162,785 Trade receivables 33,749 37,194 Vehicle receivables 36,470 34,876 Manufacturer receivables 59,215 56,008 Auto loan receivables 42,490 25,424 Other receivables 3,033 4,554 343,417 320,841 Less: Allowance for doubtful accounts (2,243 ) (2,904 ) Less: Long-term portion of accounts receivable, net (32,712 ) (22,558 ) Total accounts receivable, net $ 308,462 $ 295,379 |
Note 3 - Inventories (Tables)
Note 3 - Inventories (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | December 31, 2015 2014 New vehicles $ 1,113,613 $ 958,876 Used vehicles 302,911 240,908 Parts and accessories 54,463 49,875 Total inventories $ 1,470,987 $ 1,249,659 |
Note 4 - Property and Equipme35
Note 4 - Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | December 31, 2015 2014 Land $ 281,982 $ 263,328 Building and improvements 527,545 475,149 Service equipment 70,559 60,644 Furniture, office equipment, signs and fixtures 119,250 100,163 999,336 899,284 Less accumulated depreciation (137,853 ) (117,679 ) 861,483 781,605 Construction in progress 15,177 35,140 $ 876,660 $ 816,745 |
Note 5 - Goodwill and Franchi36
Note 5 - Goodwill and Franchise Value (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Goodwill [Table Text Block] | Domestic Import Luxury Consolidated Balance as of December 31, 2013 (1) $ 22,548 $ 16,797 $ 10,166 $ 49,511 Additions through acquisitions 68,463 62,804 18,597 149,864 Balance as of December 31, 2014 (1) 91,011 79,601 28,763 199,375 Additions through acquisitions 6,892 5,029 2,170 14,091 Reductions through divestitures — (246 ) — (246 ) Balance as of December 31, 2015 (1) $ 97,903 $ 84,384 $ 30,933 $ 213,220 |
Schedule of Indefinite-Lived Intangible Assets [Table Text Block] | Franchise Value Balance as of December 31, 2013 $ 71,199 Additions through acquisitions 80,233 Transfers to assets held for sale (540 ) Balance as of December 31, 2014 150,892 Additions through acquisitions 6,843 Reductions through divestitures (36 ) Balance as of December 31, 2015 $ 157,699 |
Note 6 - Credit Facilities an37
Note 6 - Credit Facilities and Long-term Debt (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Debt [Table Text Block] | December 31, 2015 2014 New vehicle floor plan commitment $ 1,265,872 $ 1,137,632 Floor plan notes payable (1) 48,083 41,047 Total floor plan debt 1,313,955 1,178,679 Used vehicle inventory financing facility 171,000 134,000 Revolving lines of credit 61,246 134,769 Real estate mortgages 387,861 334,443 Other debt 25,247 37,766 Total debt $ 1,959,309 $ 1,819,657 |
Debt Covenant Terms [Table Text Block] | Debt Covenant Ratio Requirement As of December 31, 2015 Current ratio Not less than 1.10 to 1 1.26 to 1 Fixed charge coverage ratio Not less than 1.20 to 1 3.36 to 1 Leverage ratio Not more than 5.00 to 1 1.79 to 1 Funded debt restriction Not to exceed $600 million $413.4 million |
Schedule of Maturities of Long-term Debt [Table Text Block] | Year Ending December 31, 2016 $ 38,823 2017 39,164 2018 39,547 2019 41,775 2020 32,923 Thereafter 220,876 Total principal payments $ 413,108 |
Note 7 - Commitments and Cont38
Note 7 - Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule Of Future Minimum Lease Payments [Table Text Block] | Year Ending December 31, 2016 $ 25,514 2017 22,910 2018 20,818 2019 19,740 2020 18,186 Thereafter 123,093 Total minimum lease payments 230,261 Less: sublease rentals (8,723 ) $ 221,538 |
Charge Backs Estimated Future Payments [Table Text Block] | Year Ending December 31, 2016 $ 19,638 2017 10,127 2018 3,907 2019 1,124 2020 214 Thereafter 23 Total $ 35,033 |
Schedule of Deferred Revenue Future Recognition [Table Text Block] | Year Ending December 31, 2016 $ 16,103 2017 12,573 2018 10,053 2019 8,406 2020 7,118 Thereafter 25,940 Total $ 80,193 |
Note 8 - Stockholders' Equity (
Note 8 - Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Class of Treasury Stock [Table Text Block] | Year Ended December 31, 2015 2014 2013 Shares repurchased pursuant to repurchase plan 228,737 226,729 127,900 Total purchase price (in thousands) $ 24,676 $ 15,990 $ 5,213 Average purchase price per share $ 107.88 $ 70.52 $ 40.76 Shares repurchased in association with tax withholdings on the exercise of stock options 77,649 106,772 59,721 |
Dividends Declared [Table Text Block] | Quarter declared Dividend amount per Class A and Class B share Total amount of dividend (in thousands) 2013 First quarter (1) $ — $ — Second quarter 0.13 3,356 Third quarter 0.13 3,363 Fourth quarter 0.13 3,366 2014 First quarter $ 0.13 $ 3,378 Second quarter 0.16 4,179 Third quarter 0.16 4,174 Fourth quarter 0.16 4,198 2015 First quarter $ 0.16 $ 4,216 Second quarter 0.20 5,266 Third quarter 0.20 5,257 Fourth quarter 0.20 5,246 |
Reclassification out of Accumulated Other Comprehensive Income [Table Text Block] | Year Ended December 31, 2015 2014 2013 Affected Line Item in the Consolidated Statement of Operations Loss on cash flow hedges $ (449 ) $ (488 ) $ (740 ) Floor plan interest expense Income tax benefits 174 187 283 Income tax provision Loss on cash flow hedges, net $ (275 ) $ (301 ) $ (457 ) |
Note 9 - 401(k) Profit Sharin40
Note 9 - 401(k) Profit Sharing, Deferred Compensation and Long-term Incentive Plans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits by Title of Individual and Type of Deferred Compensation [Table Text Block] | Year Ended December 31, 2015 2014 2013 Compensation expense (in millions) $ 1.8 $ 1.9 $ 1.4 Total discretionary contribution (in millions) $ 2.2 $ 2.4 $ 2.1 Guaranteed annual return 5.25 % 5.25 % 5.25 % |
Note 10 - Stock-based Compens41
Note 10 - Stock-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Share-based Compensation, Employee Stock Purchase Plan, Activity [Table Text Block] | Year Ended December 31, 2015 Shares purchased pursuant to 2009 ESPP 71,811 Weighted average per share price of shares purchased $ 90.04 Weighted average per share discount from market value for shares purchased $ 15.89 As of December 31, 2015 Shares available for purchase pursuant to 2009 ESPP 467,660 |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block] | RSUs Weighted average grant date fair value Balance, December 31, 2014 464,758 $ 36.33 Granted 171,185 88.74 Vested (216,833 ) 62.74 Forfeited (8,036 ) 57.73 Balance, December 31, 2015 411,074 59.13 |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | Shares subject to options Weighted average exercise price Aggregate intrinsic value (in millions) Weighted average remaining contractual term (in years) Balance, December 31, 2014 6,834 $ 6.79 $ 0.5 0.8 Granted — — Forfeited — — Expired (2,000 ) 3.23 Exercised (4,834 ) 8.27 Balance, December 31, 2015 — — — — Exercisable, December 31, 2015 — — — — |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] | Year Ended December 31, 2015 2014 2013 Per share intrinsic value of non-vested stock granted $ 88.74 $ 68.99 $ 43.13 Weighted average per share discount for compensation expense recognized under the 2009 ESPP 15.89 11.92 8.81 Total intrinsic value of stock options exercised (in millions) 0.5 3.1 8.7 Fair value of non-vested stock that vested during the period (in millions) 19.3 18.9 8.4 Stock-based compensation recognized in Consolidated Statements of Operations, as a component of selling, general and administrative expense (in millions) 11.9 7.4 6.6 Tax benefit recognized in Consolidated Statements of Operations (in millions) 4.2 2.6 2.3 Cash received from options exercised and shares purchased under all share-based arrangements (in millions) 6.5 4.9 5.2 Tax deduction realized related to stock options exercised (in millions) 7.6 8.4 6.5 |
Note 11 - Derivative Financia42
Note 11 - Derivative Financial Instrument (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | Balance Sheet Information Fair Value of Liability Derivatives Derivatives Designated as Hedging Instruments Location in Balance Sheet December 31, 2015 Interest Rate Swap Contract Accrued liabilities $ 532 Other long-term liabilities — $ 532 Balance Sheet Information Fair Value of Liability Derivatives Derivatives Designated as Hedging Instruments Location in Balance Sheet December 31, 2014 Interest Rate Swap Contract Accrued liabilities $ 1,194 Other long-term liabilities 556 $ 1,750 |
Derivative Instruments, Gain (Loss) [Table Text Block] | Derivatives in Cash Flow Hedging Relationships Amount of gain recognized in Accumulated OCI (effective portion) Location of loss reclassified from Accumulated OCI into Income (effective portion) Amount of loss reclassified from Accumulated OCI into Income (effective portion) Location of loss recognized in Income on derivative (ineffective portion and amount excluded from effectiveness testing) Amount of loss recognized in Income on derivative (ineffective portion and amount excluded from effectiveness testing) For the Year Ended December 31, 2015 Interest rate swap contract $ 599 Floor plan interest expense $ (449 ) Floor plan interest expense $ (758 ) For the Year Ended December 31, 2014 Interest rate swap contract $ 505 Floor plan interest expense $ (488 ) Floor plan interest expense $ (732 ) For the Year Ended December 31, 2013 Interest rate swap contracts $ 1,005 Floor plan interest expense $ (740 ) Floor plan interest expense $ (1,235 ) |
Note 12 - Fair Value Measurem43
Note 12 - Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] | Fair Value at December 31, 2015 Level 1 Level 2 Level 3 Measured on a recurring basis: Derivative contract, net $ — $ 532 $ — Measured on a non-recurring basis: Equity-method investment $ — $ — $ 22,284 Long-lived assets held and used: Certain buildings and improvements — — 6,559 Fair Value at December 31, 2014 Level 1 Level 2 Level 3 Measured on a recurring basis: Derivative contract, net $ — $ 1,750 $ — Measured on a non-recurring basis: Equity-method investment $ — $ — $ 33,282 |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments [Table Text Block] | December 31, 2015 2014 Carrying value $ 297,463 $ 257,780 Fair value 296,961 270,781 |
Note 13 - Income Taxes (Tables)
Note 13 - Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | Year Ended December 31, 2015 2014 2013 Current: Federal $ 58,408 $ 56,342 $ 46,727 State 14,572 7,944 5,539 72,980 64,286 52,266 Deferred: Federal 6,046 10,433 9,010 State 679 236 (702 ) 6,725 10,669 8,308 Total $ 79,705 $ 74,955 $ 60,574 |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | Year Ended December 31, 2015 2014 2013 Federal tax provision at statutory rate $ 91,947 $ 73,673 $ 58,026 State taxes, net of federal income tax benefit 9,357 6,526 3,141 Equity investment basis difference 11,048 1,422 — Non-deductible items 882 1,766 1,010 Permanent differences related to the employee stock purchase program 156 68 55 Net change in valuation allowance (3,303 ) (4,121 ) (554 ) General business credits (29,093 ) (4,002 ) (440 ) Other (1,289 ) (377 ) (664 ) Income tax provision $ 79,705 $ 74,955 $ 60,574 |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | December 31, 2015 2014 Deferred tax assets: Deferred revenue and cancellation reserves $ 39,323 $ 31,539 Allowances and accruals, including state tax carryforward amounts 43,185 29,198 Interest on derivatives 206 678 Goodwill 2,581 2,668 Capital loss carryforward 10,414 10,711 Valuation allowance (5,360 ) (8,663 ) Total deferred tax assets 90,349 66,131 Deferred tax liabilities: Inventories (21,313 ) (19,356 ) Goodwill (31,258 ) (21,320 ) Property and equipment, principally due to differences in depreciation (84,355 ) (67,271 ) Prepaid expenses and other (6,552 ) (3,582 ) Total deferred tax liabilities (143,478 ) (111,529 ) Total $ (53,129 ) $ (45,398 ) |
Schedule of Unrecognized Tax Benefits Roll Forward [Table Text Block] | Balance, December 31, 2013 $ — Acquired with acquisition 1,495 Balance, December 31, 2014 1,495 Decrease related to tax positions taken - prior year (464 ) Balance, December 31, 2015 $ 1,031 |
Summary of Income Tax Contingencies [Table Text Block] | Federal 2012 - 2015 18 states 2011 - 2015 |
Note 14 - Acquisitions (Tables)
Note 14 - Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Operating Results from Acquisitions [Table Text Block] | Year Ended December 31, 2015 Revenue $ 45,891 Operating income 23 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | Consideration paid for year ended December 31, 2015 DCH All other acquisitions Total 2014 Cash paid, net of cash acquired $ 71,615 $ 569,995 $ 89,639 $ 659,634 Forgiven outstanding note receivable 1,374 — — — Equity securities issued — 19,736 — 19,736 $ 72,989 $ 589,731 $ 89,639 $ 679,370 Assets acquired and liabilities assumed for year ended December 31, 2015 DCH All other acquisitions Total 2014 Trade receivables, net $ 36 $ 63,888 $ — $ 63,888 Inventories 34,374 265,378 48,662 314,040 Franchise value 6,843 72,856 7,377 80,233 Property and equipment 22,118 256,122 17,395 273,517 Other assets 224 20,313 531 20,844 Floor plan notes payable — (24,686 ) — (24,686 ) Debt and capital lease obligations (2,160 ) (52,532 ) (3,161 ) (55,693 ) Deferred taxes, net — (49,651 ) — (49,651 ) Other liabilities (2,537 ) (92,863 ) (123 ) (92,986 ) 58,898 458,825 70,681 529,506 Goodwill 14,091 130,906 18,958 149,864 $ 72,989 $ 589,731 $ 89,639 $ 679,370 |
Business Acquisition, Pro Forma Information [Table Text Block] | Year Ended December 31, 2015 2014 Revenue $ 7,999,256 $ 7,333,480 Income from continuing operations, net of tax 182,131 147,975 Basic income per share from continuing operations, net of tax 6.93 5.66 Diluted income per share from continuing operations, net of tax 6.88 5.61 |
Note 15 - Discontinued Operat46
Note 15 - Discontinued Operations and Assets and Related Liabilities Held for Sale (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Disclosure of Long Lived Assets Held-for-sale [Table Text Block] | December 31, 2015 2014 Inventories $ — $ 6,284 Property, plant and equipment — 1,739 Intangible assets — 540 $ — $ 8,563 December 31, 2015 2014 Floor plan notes payable $ — $ 4,892 |
Disposal Groups, Including Discontinued Operations [Table Text Block] | Year Ended December 31, 2015 2014 2013 Floor plan interest $ — $ 32 $ 117 Other interest — 8 21 Total interest $ — $ 40 $ 138 Year Ended December 31, 2015 2014 2013 Revenue $ — $ 12,569 $ 38,978 Pre-tax gain (loss) from discontinued operations $ — $ (467 ) $ 1,310 Net gain on disposal activities — 5,744 — 5,277 1,310 Income tax expense — (2,097 ) (524 ) Income from discontinued operations, net of income tax expense $ — $ 3,180 $ 786 Goodwill and other intangible assets disposed of $ — $ 211 $ — |
Note 17 - Net Income Per Shar47
Note 17 - Net Income Per Share of Class A and Class B Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Year Ended December 31, 2015 2014 2013 Basic EPS Class A Class B Class A Class B Class A Class B Numerator: Income from continuing operations applicable to common stockholders $ 165,172 $ 17,827 $ 122,246 $ 13,294 $ 94,532 $ 10,682 Distributed income applicable to common stockholders (18,038 ) (1,947 ) (14,367 ) (1,562 ) (9,061 ) (1,024 ) Basic undistributed income from continuing operations applicable to common stockholders $ 147,134 $ 15,880 $ 107,879 $ 11,732 $ 85,471 $ 9,658 Denominator: Weighted average number of shares out-standing used to calculate basic income per share 23,729 2,561 23,559 2,562 23,185 2,620 Basic income from continuing operations per share applicable to common stockholders $ 6.96 $ 6.96 $ 5.19 $ 5.19 $ 4.08 $ 4.08 Basic distributed income per share applicable to common stockholders (0.76 ) (0.76 ) (0.61 ) (61 ) (0.39 ) (0.39 ) Basic undistributed income from continuing operations per share applicable to common stockholders $ 6.20 $ 6.20 $ 4.58 $ 4.58 $ 3.69 $ 3.69 Year Ended December 31, 2015 2014 2013 Diluted EPS Class A Class B Class A Class B Class A Class B Numerator: Distributed income applicable to common stockholders $ 18,038 $ 1,947 $ 14,367 $ 1,562 $ 9,061 $ 1,024 Reallocation of distributed income as a result of conversion of dilutive stock options 15 (15 ) 15 (15 ) 15 (15 ) Reallocation of distributed income due to conversion of Class B to Class A 1,932 — 1,547 — 1,009 — Diluted distributed income applicable to common stockholders $ 19,985 $ 1,932 $ 15,929 $ 1,547 $ 10,085 $ 1,009 Undistributed income from continuing operations applicable to common stockholders $ 147,134 $ 15,880 $ 107,879 $ 11,732 $ 85,471 $ 9,658 Reallocation of undistributed income as a result of conversion of dilutive stock options 120 (120 ) 116 (116 ) 142 (142 ) Reallocation of undistributed income due to conversion of Class B to Class A 15,760 — 11,616 — 9,516 — Diluted undistributed income from continuing operations applicable to common stockholders $ 163,014 $ 15,760 $ 119,611 $ 11,616 $ 95,129 $ 9,516 Denominator: Weighted average number of shares outstanding used to calculate basic income per share 23,729 2,561 23,559 2,562 23,185 2,620 Weighted average number of shares from stock options 200 — 261 — 386 — Conversion of Class B to Class A 2,561 — 2,562 — 2,620 — Weighted average number of shares outstanding used to calculate diluted income per share 26,490 2,561 26,382 2,562 26,191 2,620 Year Ended December 31, 2015 2014 2013 Diluted EPS Class A Class B Class A Class B Class A Class B Diluted income from continuing operations per share available to common stockholders $ 6.91 $ 6.91 $ 5.14 $ 5.14 $ 4.02 $ 4.02 Diluted distributed income from continuing operations per share applicable to common stockholders (0.76 ) (0.76 ) (0.61 ) (0.61 ) (0.39 ) (0.39 ) Diluted undistributed income from continuing operations per share applicable to common stockholders $ 6.15 $ 6.15 $ 4.53 $ 4.53 $ 3.63 $ 3.63 Antidilutive Securities: Shares issuable pursuant to stock options not included since they were antidilutive 16 — 13 — 16 — |
Note 18 - Equity-method Inves48
Note 18 - Equity-method Investment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Consolidated Statement of Operations [Member] | |
Notes Tables | |
Equity Method Investments [Table Text Block] | Year Ended December 31, 2015 2014 2013 Asset impairments to write investment down to fair value $ 16,521 $ 1,853 $ — Our portion of the partnership’s operating losses 6,929 1,160 — Non-cash interest expense related to the amortization of the discounted fair value of future equity contributions 674 152 — Tax benefits and credits generated 30,832 6,506 — |
Consolidated Balance Sheet [Member] | |
Notes Tables | |
Equity Method Investments [Table Text Block] | December 31, 2015 2014 Carrying value, recorded as a component of other non-current assets $ 22,284 $ 33,282 Present value of obligation associated with future equity contributions, recorded as a component of accrued liabilities and other long-term liabilities 22,511 32,177 |
Note 19 - Segments (Tables)
Note 19 - Segments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Year Ended December 31, 2015 2014 2013 Revenues: Domestic $ 3,034,849 $ 2,566,473 $ 2,145,478 Import 3,334,983 1,893,034 1,225,800 Luxury 1,490,632 926,856 629,521 7,860,464 5,386,363 4,000,799 Corporate and other 3,788 3,963 4,950 $ 7,864,252 $ 5,390,326 $ 4,005,749 Segment income*: Domestic $ 115,525 $ 96,888 $ 84,500 Import 98,371 50,870 40,264 Luxury 36,391 25,448 16,133 250,287 173,206 140,897 Corporate and other 74,514 71,195 50,283 Depreciation and amortization (41,600 ) (26,363 ) (20,035 ) Other interest expense (19,491 ) (10,742 ) (8,350 ) Other (expense) income, net (1,006 ) 3,199 2,993 Income from continuing operations before income taxes $ 262,704 $ 210,495 $ 165,788 Floor plan interest expense: Domestic $ 20,970 $ 17,852 $ 15,223 Import 15,051 9,439 6,475 Luxury 9,096 5,098 3,931 45,117 32,389 25,629 Corporate and other (25,583 ) (18,528 ) (13,256 ) $ 19,534 $ 13,861 $ 12,373 |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | December 31, 2015 2014 Total assets: Domestic $ 985,374 $ 829,721 Import 725,011 698,015 Luxury 475,305 405,222 Corporate and other 1,041,609 947,974 $ 3,227,299 $ 2,880,932 |
Note 1 - Summary of Significa50
Note 1 - Summary of Significant Accounting Policies (Details Textual) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Minimum [Member] | |||
Long-term Debt, Percentage Bearing Variable Interest, Percentage Rate | 1.49% | ||
Maximum [Member] | |||
Long-term Debt, Percentage Bearing Variable Interest, Percentage Rate | 3.00% | ||
Number of New Vehicle Brands | 31 | ||
Number of Stores | 137 | ||
Interest Costs Capitalized | $ 0.5 | $ 0.4 | $ 0.1 |
Number of Financial Institutions | 18 | ||
Number of Manufacturer Affiliated Finance Companies | 8 | ||
Long-term Debt, Percentage Bearing Variable Interest, Amount | $ 1,700 | ||
Product Warranty Accrual | $ 0.5 | $ 0.4 | |
Number of Reportable Segments | 3 |
Note 1 - Property and Equipment
Note 1 - Property and Equipment Estimated Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Building and Building Improvements [Member] | Minimum [Member] | |
Property, plant and equipment, useful life | 5 years |
Building and Building Improvements [Member] | Maximum [Member] | |
Property, plant and equipment, useful life | 40 years |
Equipment [Member] | Minimum [Member] | |
Property, plant and equipment, useful life | 5 years |
Equipment [Member] | Maximum [Member] | |
Property, plant and equipment, useful life | 15 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, plant and equipment, useful life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, plant and equipment, useful life | 10 years |
Note 1 - Advertising Expense an
Note 1 - Advertising Expense and Manufacturing Cooperative Advertising Credits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Advertising expense, gross | $ 89,736 | $ 62,933 | $ 51,404 |
Manufacturer cooperative advertising credits | (19,801) | (16,281) | (11,806) |
Advertising expense, net | $ 69,935 | $ 46,652 | $ 39,598 |
Note 2 - Accounts Receivable (D
Note 2 - Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Contracts in Transit [Member] | ||
Accounts receivable gross | $ 168,460 | $ 162,785 |
Trade Accounts Receivable [Member] | ||
Accounts receivable gross | 33,749 | 37,194 |
Vehicle Receivables [Member] | ||
Accounts receivable gross | 36,470 | 34,876 |
Manufacturer Receivables [Member] | ||
Accounts receivable gross | 59,215 | 56,008 |
Auto Loans Receivables [Member] | ||
Accounts receivable gross | 42,490 | 25,424 |
Other Receivables [Member] | ||
Accounts receivable gross | 3,033 | 4,554 |
Accounts receivable gross | 343,417 | 320,841 |
Less: Allowance for doubtful accounts | (2,243) | (2,904) |
Less: Long-term portion of accounts receivable, net | (32,712) | (22,558) |
Total accounts receivable, net | $ 308,462 | $ 295,379 |
Note 3 - Inventories (Details T
Note 3 - Inventories (Details Textual) - USD ($) $ in Millions | Dec. 31, 2015 | Dec. 31, 2014 |
Inventory Adjustments | $ 13.6 | $ 12.3 |
Note 3 - Inventories (Details)
Note 3 - Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
New Vehicle [Member] | ||
Inventory Net | $ 1,113,613 | $ 958,876 |
Used Vehicle [Member] | ||
Inventory Net | 302,911 | 240,908 |
Parts and Accessories [Member] | ||
Inventory Net | 54,463 | 49,875 |
Inventory Net | $ 1,470,987 | $ 1,249,659 |
Note 4 - Property and Equipme56
Note 4 - Property and Equipment (Details Textual) $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Impairment of Long-Lived Assets Held-for-use | $ 3.6 |
Note 4 - Property and Equipme57
Note 4 - Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Land [Member] | ||
Property, plant and equipment, gross | $ 281,982 | $ 263,328 |
Building and Building Improvements [Member] | ||
Property, plant and equipment, gross | 527,545 | 475,149 |
Equipment [Member] | ||
Property, plant and equipment, gross | 70,559 | 60,644 |
Furniture and Fixtures [Member] | ||
Property, plant and equipment, gross | 119,250 | 100,163 |
Excluding Construction in Progress [Member] | ||
Property, plant and equipment, net | 861,483 | 781,605 |
Construction in Progress [Member] | ||
Property, plant and equipment, gross | 15,177 | 35,140 |
Property, plant and equipment, gross | 999,336 | 899,284 |
Less accumulated depreciation | (137,853) | (117,679) |
Property, plant and equipment, net | $ 876,660 | $ 816,745 |
Note 5 - Goodwill and Franchi58
Note 5 - Goodwill and Franchise Value (Details Textual) $ in Millions | Dec. 31, 2008USD ($) |
Goodwill, Impaired, Accumulated Impairment Loss | $ 299.3 |
Note 5 - Goodwill (Details)
Note 5 - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | ||
Domestic [Member] | |||
Balance | [1] | $ 91,011 | $ 22,548 |
Additions through acquisitions | 6,892 | 68,463 | |
Balance | [1] | $ 97,903 | 91,011 |
Reductions through divestitures | |||
Import [Member] | |||
Balance | [1] | $ 79,601 | 16,797 |
Additions through acquisitions | 5,029 | 62,804 | |
Balance | [1] | 84,384 | 79,601 |
Reductions through divestitures | (246) | ||
Luxury [Member] | |||
Balance | [1] | 28,763 | 10,166 |
Additions through acquisitions | 2,170 | 18,597 | |
Balance | [1] | $ 30,933 | 28,763 |
Reductions through divestitures | |||
Balance | [1] | $ 199,375 | 49,511 |
Additions through acquisitions | 14,091 | 149,864 | |
Balance | [1] | 213,220 | $ 199,375 |
Reductions through divestitures | $ (246) | ||
[1] | Net of accumulated impairment losses of $299.3 million recorded during the year ended December 31, 2008. |
Note 5 - Franchise Value (Detai
Note 5 - Franchise Value (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Balance | $ 150,892 | $ 71,199 |
Additions through acquisitions | 6,843 | 80,233 |
Written off related to sale of business | (36) | (540) |
Balance | $ 157,699 | $ 150,892 |
Note 6 - Credit Facilities an61
Note 6 - Credit Facilities and Long-term Debt (Details Textual) | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | ||
Used Vehicle Inventory Financing [Member] | Syndicated Credit Facility [Member] | Reallocation [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 250,000,000 | ||
Used Vehicle Inventory Financing [Member] | Syndicated Credit Facility [Member] | |||
Line of Credit Facility, Inventory Collateral, Days in Stock, Maximum | 180 days | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 200,000,000 | ||
Used Vehicle Inventory Financing [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | ||
Used Vehicle Inventory Financing [Member] | |||
Line of Credit Facility, Interest Rate During Period | 1.93% | ||
New Vehicle Floor Plan [Member] | Syndicated Credit Facility [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,450,000,000 | ||
New Vehicle Floor Plan [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | |||
Disposal Group, Including Discontinued Operation, Liabilities | $ 4,900,000 | ||
New Vehicle Floor Plan [Member] | |||
Reserve Commitment Percent | 95.00% | ||
Maximum Reserve Amount if Reserve is Required | $ 15,000,000 | ||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||
Line of Credit Facility, Interest Rate During Period | 1.68% | ||
Revolving Credit Facility [Member] | Syndicated Credit Facility [Member] | Reallocation [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 300,000,000 | ||
Revolving Credit Facility [Member] | Syndicated Credit Facility [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 200,000,000 | ||
Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||
Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | ||
Revolving Credit Facility [Member] | |||
Line of Credit Facility, Interest Rate During Period | 2.18% | ||
Syndicated Credit Facility [Member] | Scenario Subject to Lender Approval [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,100,000,000 | ||
Syndicated Credit Facility [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,850,000,000 | ||
Number of Financial Institutions | 18 | ||
Number of Manufacturer Affiliated Finance Companies | 8 | ||
Floor Plan Notes Payable [Member] | Maximum [Member] | |||
Debt Instrument, Interest Rate, Stated Percentage | 3.00% | ||
Minimum [Member] | Mortgages [Member] | |||
Debt Instrument, Interest Rate, Stated Percentage | 1.80% | ||
Minimum [Member] | Other 1 [Member] | |||
Debt Instrument, Interest Rate, Stated Percentage | 2.20% | ||
Maximum [Member] | Mortgages [Member] | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||
Maximum [Member] | Other 1 [Member] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | ||
Mortgages [Member] | |||
Percent of Total Mortgage Debt that is Fixed | 70.00% | ||
Other 1 [Member] | |||
Long-term Debt | $ 25,200,000 | ||
Principal Reduction Accounts Outstanding Amount | $ 0 | ||
Disposal Group, Including Discontinued Operation, Liabilities | $ 4,892,000 | ||
Number of Financial Institutions | 18 | ||
Number of Manufacturer Affiliated Finance Companies | 8 | ||
Principal Reduction Accounts Maximum Deposit Amount | $ 50,000,000 | ||
Floor Plan Notes Payable | 48,083,000 | $ 41,047,000 | [1] |
Long-term Debt | $ 413,108,000 | ||
[1] | At December 31, 2014, we had an additional $4.9 million of floor plan notes payable outstanding on our new vehicle floor plan commitment recorded as liability related to assets held for sale. |
Note 6 - Credit Facilities an62
Note 6 - Credit Facilities and Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | |
Used Vehicle Inventory Financing [Member] | |||
Line of credit | $ 171,000 | $ 134,000 | |
Revolving Credit Facility [Member] | |||
Line of credit | 61,246 | 134,769 | |
New vehicle floor plan commitment | 1,265,872 | 1,137,632 | |
Floor plan notes payable | 48,083 | 41,047 | [1] |
Total floor plan debt | 1,313,955 | 1,178,679 | |
Real estate mortgages | 387,861 | 334,443 | |
Other debt | 25,247 | 37,766 | |
Total debt | $ 1,959,309 | $ 1,819,657 | |
[1] | At December 31, 2014, we had an additional $4.9 million of floor plan notes payable outstanding on our new vehicle floor plan commitment recorded as liability related to assets held for sale. |
Note 6 - Details of Financial C
Note 6 - Details of Financial Covenants (Details) $ in Millions | Dec. 31, 2015USD ($) |
Current ratio, requirement | 1.1 |
Current ratio | 1.26 |
Fixed charge coverage ratio, requirement | 1.2 |
Fixed charge coverage ratio | 3.36 |
Leverage ratio, requirement | 5 |
Leverage ratio | 1.79 |
Funded debt restriction | $ 600 |
Funded debt | $ 413.4 |
Note 6 - Future Principal Payme
Note 6 - Future Principal Payments on Long-term Debt (Details) $ in Thousands | Dec. 31, 2015USD ($) |
2,016 | $ 38,823 |
2,017 | 39,164 |
2,018 | 39,547 |
2,019 | 41,775 |
2,020 | 32,923 |
Thereafter | 220,876 |
Total principal payments | $ 413,108 |
Note 7 - Commitments and Cont65
Note 7 - Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Lifetime Oil Contracts [Member] | |||
Deferred Revenue | $ 80,200 | ||
Operating Leases, Rent Expense, Minimum Rentals | 23,800 | $ 17,200 | $ 14,000 |
Charge Backs Liabilities | 35,033 | ||
Contracts Obligations Reserve | 3,400 | ||
Self Insurance Reserve | $ 25,900 | $ 23,200 |
Note 7 - Minimum Lease Payments
Note 7 - Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2015USD ($) |
2,016 | $ 25,514 |
2,017 | 22,910 |
2,018 | 20,818 |
2,019 | 19,740 |
2,020 | 18,186 |
Thereafter | 123,093 |
Total minimum lease payments | 230,261 |
Less: sublease rentals | (8,723) |
$ 221,538 |
Note 7 - Charge-Backs for Vario
Note 7 - Charge-Backs for Various Contracts (Details) $ in Thousands | Dec. 31, 2015USD ($) |
2,016 | $ 19,638 |
2,017 | 10,127 |
2,018 | 3,907 |
2,019 | 1,124 |
2,020 | 214 |
Thereafter | 23 |
Total | $ 35,033 |
Note 7 - Lifetime Lube, Oil and
Note 7 - Lifetime Lube, Oil and Filter Contracts Aquired (Details) - Lifetime Oil Contracts [Member] $ in Thousands | Dec. 31, 2015USD ($) |
2,016 | $ 16,103 |
2,017 | 12,573 |
2,018 | 10,053 |
2,019 | 8,406 |
2,020 | 7,118 |
Thereafter | 25,940 |
Total | $ 80,193 |
Note 8 - Stockholders' Equity69
Note 8 - Stockholders' Equity (Details Textual) | 12 Months Ended | 53 Months Ended | ||||
Dec. 31, 2015shares | Dec. 31, 2014shares | Dec. 31, 2013shares | Dec. 31, 2015$ / sharesshares | Jul. 20, 2012shares | Aug. 31, 2011shares | |
Common Class A [Member] | Additional Shares Authorized [Member] | ||||||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 1,000,000 | |||||
Common Class A [Member] | ||||||
Conversion of Common Stock Shares | 1 | |||||
Common Stock Number of Votes | 1 | |||||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 2,000,000 | |||||
Stock Repurchased During Period, Shares | 228,737 | 226,729 | 127,900 | 1,700,000 | ||
Treasury Stock Acquired, Average Cost Per Share | $ / shares | $ 41.34 | |||||
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased | 1,300,000 | 1,300,000 | ||||
Common Class B [Member] | ||||||
Percentage of Class B Common to Total Common Stock Subject to Automatic Conversion | 1.00% | |||||
Common Stock Number of Votes | 10 |
Note 8 - Share Repurchases (Det
Note 8 - Share Repurchases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Common Class A [Member] | Share Repurchase Plan [Member] | |||
Total purchase price (in thousands) | $ 24,676 | $ 15,990 | $ 5,213 |
Average purchase price per share (in dollars per share) | $ 107.88 | $ 70.52 | $ 40.76 |
Common Class A [Member] | |||
Shares repurchased pursuant to repurchase plan (in shares) | 228,737 | 226,729 | 127,900 |
Total purchase price (in thousands) | $ 31,548 | $ 22,968 | $ 7,903 |
Shares repurchased in association with tax withholdings on the exercise of stock options (in shares) | 77,649 | 106,772 | 59,721 |
Note 8 - Dividends Paid (Detail
Note 8 - Dividends Paid (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | [1] | |
Dividend amount per share (in dollars per share) | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.16 | $ 0.16 | $ 0.16 | $ 0.16 | $ 0.13 | $ 0.13 | $ 0.13 | $ 0.13 | ||
Total amount of dividend | $ 5,246 | $ 5,257 | $ 5,266 | $ 4,216 | $ 4,198 | $ 4,174 | $ 4,179 | $ 3,378 | $ 3,366 | $ 3,363 | $ 3,356 | ||
[1] | We declared and paid a dividend payment in December 2012 in lieu of the dividend typically declared and paid in March of the following year. |
Note 8 - Reclassification from
Note 8 - Reclassification from Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Floor Plan Interest Expense [Member] | |||
Loss on cash flow hedges | $ (449) | $ (488) | $ (740) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Income Tax Provision [Member] | |||
Income tax benefits | 174 | 187 | 283 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||
Loss on cash flow hedges, net | (275) | (301) | (457) |
Floor Plan Interest Expense [Member] | |||
Loss on cash flow hedges | $ (449) | $ (488) | $ (740) |
Note 9 - 401(k) Profit Sharin73
Note 9 - 401(k) Profit Sharing, Deferred Compensation and Long-term Incentive Plans (Details Textual) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Minimum [Member] | |||
Deferred Compensation Arrangement with Individual, Requisite Service Period | 1 year | ||
Maximum [Member] | |||
Deferred Compensation Arrangement with Individual, Requisite Service Period | 7 years | ||
Other Noncurrent Liabilities [Member] | |||
Deferred Compensation Liability, Classified, Noncurrent | $ 19.7 | $ 14.2 | |
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 5.3 | $ 3.2 | $ 2.1 |
Note 9 - Compensation Expense (
Note 9 - Compensation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Compensation expense (in millions) | $ 1.8 | $ 1.9 | $ 1.4 |
Total discretionary contribution (in millions) | $ 2.2 | $ 2.4 | $ 2.1 |
Guaranteed annual return | 5.25% | 5.25% | 5.25% |
Note 10 - Stock-based Compens75
Note 10 - Stock-based Compensation (Details Textual) | 12 Months Ended | 144 Months Ended | |
Dec. 31, 2015USD ($)shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014shares | |
Two Thousand Thirteen Stock Incentive Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 0 | 0 | |
Two Thousand Thirteen Stock Incentive Plan [Member] | Restricted Stock [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | ||
Two Thousand Thirteen Stock Incentive Plan [Member] | Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 0 | 0 | |
Two Thousand Thirteen Stock Incentive Plan [Member] | Time Vesting RSU [Member] | |||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 34,903 | ||
Two Thousand Thirteen Stock Incentive Plan [Member] | Performance and Time Vestings RSU's [Member] | |||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 85,290 | ||
Two Thousand Thirteen Stock Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | ||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 50,992 | ||
Weighted Average Attainment Level for Performance and Time Vesting RSUs | 72.00% | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $ | $ 10,300,000 | $ 10,300,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 109 days | ||
Two Thousand Thirteen Stock Incentive Plan [Member] | Employee Stock Option [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||
Two Thousand Thirteen Stock Incentive Plan [Member] | Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | 6 years | |
Two Thousand Thirteen Stock Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 0 | 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 3,800,000 | 3,800,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,520,910 | 1,520,910 | |
Number of Senior Executives Received RSU | 12 | ||
The 2009 ESPP [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,500,000 | 1,500,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription Rate | 10.00% | 10.00% | |
Share Based Compensation Arrangement By Share Based Payment Award Maximum Amount Of Stock Per Employee | $ | $ 25,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent | 85.00% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Discount from Market Price, Offering Date | 15.00% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 467,660 | 467,660 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 6,834 |
Note 10 - Summary of 2009 ESPP
Note 10 - Summary of 2009 ESPP (Details) | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
The 2009 ESPP [Member] | |
Shares purchased pursuant to 2009 ESPP (in shares) | shares | 71,811 |
Weighted average per share price of shares purchased (in dollars per share) | $ 90.04 |
Weighted average per share discount from market value for shares purchased (in dollars per share) | $ 15.89 |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | shares | 467,660 |
Weighted average per share discount from market value for shares purchased (in dollars per share) | $ 15.89 |
Note 10 - Stock Incentive Plans
Note 10 - Stock Incentive Plans Activity - Restricted Stock (Details) - Restricted Stock [Member] | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Balance (in shares) | shares | 464,758 |
Balance (in dollars per share) | $ / shares | $ 36.33 |
Granted (in shares) | shares | 171,185 |
Granted (in dollars per share) | $ / shares | $ 88.74 |
Vested (in shares) | shares | (216,833) |
Vested (in dollars per share) | $ / shares | $ 62.74 |
Forfeited (in shares) | shares | (8,036) |
Forfeited (in dollars per share) | $ / shares | $ 57.73 |
Balance (in shares) | shares | 411,074 |
Balance (in dollars per share) | $ / shares | $ 59.13 |
Note 10 - Stock Incentive Pla78
Note 10 - Stock Incentive Plans Activity - Stock Options (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Balance, shares subject to options (in shares) | 6,834 | |
Balance, weighted average exercise price (in dollars per share) | $ 6.79 | |
Balance, aggregate intrinsic value | $ 0.5 | |
Balance, weighted average remaining contractual term | 292 days | |
Expired (in shares) | (2,000) | |
Expired (in dollars per share) | $ 3.23 | |
Exercised (in shares) | (4,834) | |
Exercised (in dollars per share) | $ 8.27 | |
Balance, shares subject to options (in shares) | 6,834 | |
Balance, weighted average exercise price (in dollars per share) | $ 6.79 | |
Balance, aggregate intrinsic value | $ 0.5 | |
Exercisable, December 31, 2015 (in shares) | ||
Exercisable, December 31, 2015 (in dollars per share) | ||
Exercisable, December 31, 2015 |
Note 10 - Stock-based Compens79
Note 10 - Stock-based Compensation Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Selling, General and Administrative Expenses [Member] | |||
Stock-based compensation recognized in Consolidated Statements of Operations, as a component of selling, general and administrative expense (in millions) | $ 11.9 | $ 7.4 | $ 6.6 |
Per share intrinsic value of non-vested stock granted (in dollars per share) | $ 88.74 | $ 68.99 | $ 43.13 |
Weighted average per share discount from market value for shares purchased (in dollars per share) | $ 15.89 | $ 11.92 | $ 8.81 |
Total intrinsic value of stock options exercised (in millions) | $ 0.5 | $ 3.1 | $ 8.7 |
Fair value of non-vested stock that vested during the period (in millions) | 19.3 | 18.9 | 8.4 |
Tax benefit recognized in Consolidated Statements of Operations (in millions) | 4.2 | 2.6 | 2.3 |
Cash received from options exercised and shares purchased under all share-based arrangements (in millions) | 6.5 | 4.9 | 5.2 |
Tax deduction realized related to stock options exercised (in millions) | $ 7.6 | $ 8.4 | $ 6.5 |
Note 11 - Derivative Financia80
Note 11 - Derivative Financial Instrument (Details Textual) - Interest Rate Swap [Member] $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
London Interbank Offered Rate (LIBOR) [Member] | |
Derivative, Variable Interest Rate | 0.43% |
Derivative Liability, Notional Amount | $ 25 |
Derivative, Maturity Date | Jun. 15, 2016 |
Derivative, Fixed Interest Rate | 5.587% |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ 0.5 |
Note 11 - Fair Value of Derivat
Note 11 - Fair Value of Derivative Instruments in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts Payable and Accrued Liabilities [Member] | Designated as Hedging Instrument [Member] | ||
Interest Rate Swap Contract | $ 532 | $ 1,194 |
Other Noncurrent Liabilities [Member] | Designated as Hedging Instrument [Member] | ||
Interest Rate Swap Contract | 556 | |
Interest Rate Swap Contract | $ 532 | $ 1,750 |
Note 11 - Effect of Derivative
Note 11 - Effect of Derivative Instruments on Consolidated Statements of Operations (Details) - Floor Plan Interest Expense [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Interest Rate Swap Contract, Amount of Gain Recognized in Accumulated OCI (Effective Portion) | $ 599 | $ 505 | $ 1,005 |
Loss on cash flow hedges | (449) | (488) | (740) |
Interest Rate Swap Contract, Amount of Loss Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) | $ (758) | $ (732) | $ (1,235) |
Note 12 - Fair Value Measurem83
Note 12 - Fair Value Measurements (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Equity Method Investments [Member] | |||
Asset Impairment Charges | $ 16,500 | $ 1,900 | |
Asset Impairment Charges | $ 20,124 | $ 1,853 |
Note 12 - Assets and Liabilitie
Note 12 - Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Derivative contract, net | ||
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Building and Building Improvements [Member] | ||
Certain buildings and improvements | ||
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Equity-method investment | ||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Derivative contract, net | $ 532 | $ 1,750 |
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Building and Building Improvements [Member] | ||
Certain buildings and improvements | ||
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Equity-method investment | ||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Derivative contract, net | ||
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | Building and Building Improvements [Member] | ||
Certain buildings and improvements | $ 6,559 | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Nonrecurring [Member] | ||
Equity-method investment | $ 22,284 | $ 33,282 |
Note 12 - Long-term Fixed Inter
Note 12 - Long-term Fixed Interest Rate Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Carrying value | $ 297,463 | $ 257,780 |
Fair value | $ 296,961 | $ 270,781 |
Note 13 - Income Taxes (Details
Note 13 - Income Taxes (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2013 | Dec. 31, 2014 | |
State and Local Jurisdiction [Member] | |||
Deferred Tax Assets, Valuation Allowance | $ 2,200,000 | ||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 2,000,000 | ||
Unrecognized Tax Benefits, Period Increase (Decrease) | $ 0 | ||
Income Taxes Receivable | $ 23,800,000 | $ 5,600,000 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | ||
Deferred Tax Assets, Valuation Allowance | $ 5,360,000 | $ 8,663,000 | |
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | (3,300,000) | ||
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | $ 2,000,000 |
Note 13 - Income Tax Provision
Note 13 - Income Tax Provision (Benefit) from Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Continuing Operations [Member] | |||
Federal | $ 58,408 | $ 56,342 | $ 46,727 |
State | 14,572 | 7,944 | 5,539 |
72,980 | 64,286 | 52,266 | |
Federal | 6,046 | 10,433 | 9,010 |
State | 679 | 236 | (702) |
6,725 | 10,669 | 8,308 | |
Income tax provision | 79,705 | 74,955 | 60,574 |
12,341 | 13,355 | 14,477 | |
Income tax provision | $ 79,705 | $ 74,955 | $ 60,574 |
Note 13 - Tax Rate Reconciliati
Note 13 - Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Federal tax provision at statutory rate | $ 91,947 | $ 73,673 | $ 58,026 |
State taxes, net of federal income tax benefit | 9,357 | 6,526 | $ 3,141 |
Equity investment basis difference | 11,048 | 1,422 | |
Non-deductible items | 882 | 1,766 | $ 1,010 |
Permanent differences related to the employee stock purchase program | 156 | 68 | 55 |
Net change in valuation allowance | (3,303) | (4,121) | (554) |
General business credits | (29,093) | (4,002) | (440) |
Other | (1,289) | (377) | (664) |
Income tax provision | $ 79,705 | $ 74,955 | $ 60,574 |
Note 13 - Deferred Tax Assets a
Note 13 - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Deferred revenue and cancellation reserves | $ 39,323 | $ 31,539 |
Allowances and accruals, including state tax carryforward amounts | 43,185 | 29,198 |
Interest on derivatives | 206 | 678 |
Goodwill | 2,581 | 2,668 |
Capital loss carryforward | 10,414 | 10,711 |
Valuation allowance | (5,360) | (8,663) |
Total deferred tax assets | 90,349 | 66,131 |
Deferred tax liabilities: | ||
Inventories | (21,313) | (19,356) |
Goodwill | (31,258) | (21,320) |
Property and equipment, principally due to differences in depreciation | (84,355) | (67,271) |
Prepaid expenses and other | (6,552) | (3,582) |
Total deferred tax liabilities | (143,478) | (111,529) |
Total | $ (53,129) | $ (45,398) |
Note 13 - Unrecognized Tax Bene
Note 13 - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Balance | $ 1,495 | |
Acquired with acquisition | $ 1,495 | |
Balance | 1,031 | $ 1,495 |
Decrease related to tax positions taken - prior year | $ (464) |
Note 13 - Open Tax Years (Detai
Note 13 - Open Tax Years (Details) | 12 Months Ended |
Dec. 31, 2015 | |
Domestic Tax Authority [Member] | Earliest Tax Year [Member] | |
Open Tax Year | 2,012 |
Domestic Tax Authority [Member] | Latest Tax Year [Member] | |
Open Tax Year | 2,015 |
State and Local Jurisdiction [Member] | Earliest Tax Year [Member] | |
Open Tax Year | 2,011 |
State and Local Jurisdiction [Member] | Latest Tax Year [Member] | |
Open Tax Year | 2,015 |
Note 14 - Acquisitions (Details
Note 14 - Acquisitions (Details Textual) | 12 Months Ended | |||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Oct. 02, 2014 | |
DCH Auto Group USA Inc [Member] | ||||
Number of Stores | 27 | |||
Selling, General and Administrative Expenses [Member] | ||||
Business Combination, Acquisition Related Costs | $ 1,900,000 | |||
Business Combination, Acquisition Related Costs | $ 0 | $ 0 | ||
Number of Stores | 137 | |||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | $ 14,100,000 |
Note 14 - Revenue and Operating
Note 14 - Revenue and Operating Income from Acquisitions (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
2015 Acquisitions [Member] | |
Revenues | $ 45,891 |
Operating income | 23 |
Revenues | 7,864,252 |
Operating income | $ 302,735 |
Note 14 - Summary of Acquisitio
Note 14 - Summary of Acquisitions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
DCH Auto Group USA Inc [Member] | ||
Payments to Acquire Businesses, Net of Cash Acquired | $ 569,995 | |
Forgiven outstanding note receivable | ||
Equity securities issued | $ 19,736 | |
Total | 589,731 | |
Trade receivables, net | 63,888 | |
Inventories | 265,378 | |
Franchise value | 72,856 | |
Property and equipment | 256,122 | |
Other assets | 20,313 | |
Floor plan notes payable | (24,686) | |
Debt and capital lease obligations | (52,532) | |
Deferred taxes, net | (49,651) | |
Other liabilities | (92,863) | |
458,825 | ||
Additions through acquisitions | 130,906 | |
589,731 | ||
All Other Acquisitions [Member] | ||
Payments to Acquire Businesses, Net of Cash Acquired | $ 89,639 | |
Forgiven outstanding note receivable | ||
Equity securities issued | ||
Total | $ 89,639 | |
Trade receivables, net | ||
Inventories | $ 48,662 | |
Franchise value | 7,377 | |
Property and equipment | 17,395 | |
Other assets | $ 531 | |
Floor plan notes payable | ||
Debt and capital lease obligations | $ (3,161) | |
Deferred taxes, net | ||
Other liabilities | $ (123) | |
70,681 | ||
Additions through acquisitions | 18,958 | |
89,639 | ||
Payments to Acquire Businesses, Net of Cash Acquired | 71,615 | $ 659,634 |
Forgiven outstanding note receivable | $ 1,374 | |
Equity securities issued | $ 19,736 | |
Total | $ 72,989 | 679,370 |
Trade receivables, net | 36 | 63,888 |
Inventories | 34,374 | 314,040 |
Franchise value | 6,843 | 80,233 |
Property and equipment | 22,118 | 273,517 |
Other assets | $ 224 | 20,844 |
Floor plan notes payable | (24,686) | |
Debt and capital lease obligations | $ (2,160) | (55,693) |
Deferred taxes, net | (49,651) | |
Other liabilities | $ (2,537) | (92,986) |
58,898 | 529,506 | |
Additions through acquisitions | 14,091 | 149,864 |
$ 72,989 | $ 679,370 |
Note 14 - Pro Forma (Details)
Note 14 - Pro Forma (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue | $ 7,999,256 | $ 7,333,480 |
Income from continuing operations, net of tax | $ 182,131 | $ 147,975 |
Basic income per share from continuing operations, net of tax (in dollars per share) | $ 6.93 | $ 5.66 |
Diluted income per share from continuing operations, net of tax (in dollars per share) | $ 6.88 | $ 5.61 |
Note 15 - Discontinued Operat96
Note 15 - Discontinued Operations and Assets and Related Liabilities Held for Sale (Details Textual) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | |||
Number of Stores | 0 | 2 | |
Goodwill and Other Intangible Assets [Member] | |||
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | $ 6,800 | ||
Number of Stores | 137 | ||
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | $ 5,744 |
Note 15 - Assets and Related Li
Note 15 - Assets and Related Liabilities Held for Sale (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Inventory [Member] | ||
Assets held for sale | $ 6,284 | |
Property, Plant and Equipment Held for Sale [Member] | ||
Assets held for sale | 1,739 | |
Intangible Assets [Member] | ||
Assets held for sale | 540 | |
Assets held for sale | 8,563 | |
Disposal Group, Including Discontinued Operation, Liabilities | $ 4,892 |
Note 15 - Financial Information
Note 15 - Financial Information of Discontinued Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Discontinued Operations [Member] | |||
Floor plan interest expense | $ 32 | $ 117 | |
Other interest | 8 | 21 | |
Total interest | 40 | 138 | |
Floor plan interest expense | $ 19,534 | 13,861 | 12,373 |
Other interest | $ 19,491 | 10,742 | 8,350 |
Revenue | 12,569 | 38,978 | |
Pre-tax gain (loss) from discontinued operations | (467) | $ 1,310 | |
Net gain on disposal activities | 5,744 | ||
5,277 | $ 1,310 | ||
Income tax expense | (2,097) | (524) | |
Income from discontinued operations, net of income tax expense | 3,180 | $ 786 | |
Goodwill and other intangible assets disposed of | $ 211 |
Note 16 - Related Party Trans99
Note 16 - Related Party Transactions (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Dec. 31, 2013 | Dec. 31, 2015 | |
Executive Chairman [Member] | Accrued Liabilities and Other Long Term Liabilities [Member] | ||
Due to Related Parties | $ 18.3 | |
Executive Chairman [Member] | ||
Related Party Transaction, Selling, General and Administrative Expenses from Transactions with Related Party | $ 18.3 | |
Sale of Land [Member] | ||
Related Party Transaction, Amounts of Transaction | $ 4.2 | |
Gain (Loss) on Disposition of Assets | $ 2.5 |
Note 17 - Earnings Per Share Re
Note 17 - Earnings Per Share Reconciliation (Details) - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Common Class A [Member] | Distributed [Member] | |||
Reallocation of distributed income as a result of conversion of dilutive stock options | $ 15,000 | $ 15,000 | $ 15,000 |
Reallocation of distributed income due to conversion of Class B to Class A | 1,932,000 | 1,547,000 | 1,009,000 |
Common Class A [Member] | Diluted [Member] | |||
Distributed income applicable to common stockholders | (19,985,000) | (15,929,000) | (10,085,000) |
Distributed income applicable to common stockholders | 19,985,000 | 15,929,000 | 10,085,000 |
Undistributed income from continuing operations applicable to common stockholders | 163,014,000 | 119,611,000 | 95,129,000 |
Common Class A [Member] | Undistributed [Member] | |||
Reallocation of distributed income as a result of conversion of dilutive stock options | 120,000 | 116,000 | 142,000 |
Reallocation of distributed income due to conversion of Class B to Class A | $ 15,760,000 | $ 11,616,000 | |
Common Class A [Member] | Employee Stock Option [Member] | |||
Shares issuable pursuant to stock options not included since they were antidilutive (in shares) | 16 | 13 | |
Common Class A [Member] | |||
Income from continuing operations applicable to common stockholders | $ 165,172,000 | $ 122,246,000 | 94,532,000 |
Distributed income applicable to common stockholders | (18,038,000) | (14,367,000) | (9,061,000) |
Basic undistributed income from continuing operations applicable to common stockholders | $ 147,134,000 | $ 107,879,000 | $ 85,471,000 |
Weighted average number of shares out-standing used to calculate basic income per share (in shares) | 23,729 | 23,559 | 23,185 |
Basic income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.96 | $ 5.19 | $ 4.08 |
Basic distributed income per share applicable to common stockholders (in dollars per share) | (0.76) | (0.61) | (0.39) |
Basic undistributed income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.20 | $ 4.58 | $ 3.69 |
Distributed income applicable to common stockholders | $ 18,038,000 | $ 14,367,000 | $ 9,061,000 |
Undistributed income from continuing operations applicable to common stockholders | $ 147,134,000 | $ 107,879,000 | $ 85,471,000 |
Weighted average number of shares from stock options (in shares) | 200 | 261 | 386 |
Conversion of Class B to Class A (in shares) | 2,561 | 2,562 | 2,620 |
Weighted average number of shares outstanding used to calculate diluted income per share (in shares) | 26,490 | 26,382 | 26,191 |
Diluted income from continuing operations per share available to common stockholders | $ 6,910 | $ 5,140 | $ 4,020 |
Diluted distributed income from continuing operations per share applicable to common stockholders (in dollars per share) | $ (0.76) | $ (0.61) | $ (0.39) |
Diluted undistributed income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.15 | $ 4.53 | $ 3.63 |
Common Class B [Member] | Distributed [Member] | |||
Reallocation of distributed income as a result of conversion of dilutive stock options | $ (15,000) | $ (15,000) | $ (15,000) |
Reallocation of distributed income due to conversion of Class B to Class A | |||
Common Class B [Member] | Diluted [Member] | |||
Distributed income applicable to common stockholders | $ (1,932,000) | $ (1,547,000) | $ (1,009,000) |
Distributed income applicable to common stockholders | 1,932,000 | 1,547,000 | 1,009,000 |
Undistributed income from continuing operations applicable to common stockholders | 15,760,000 | 11,616,000 | 9,516,000 |
Common Class B [Member] | Undistributed [Member] | |||
Reallocation of distributed income as a result of conversion of dilutive stock options | (120,000) | (116,000) | (142,000) |
Common Class B [Member] | |||
Income from continuing operations applicable to common stockholders | 17,827,000 | 13,294,000 | 10,682,000 |
Distributed income applicable to common stockholders | (1,947,000) | (1,562,000) | (1,024,000) |
Basic undistributed income from continuing operations applicable to common stockholders | $ 15,880,000 | $ 11,732,000 | $ 9,658,000 |
Weighted average number of shares out-standing used to calculate basic income per share (in shares) | 2,561 | 2,562 | 2,620 |
Basic income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.96 | $ 5.19 | $ 4.08 |
Basic distributed income per share applicable to common stockholders (in dollars per share) | (0.76) | (61) | (0.39) |
Basic undistributed income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.20 | $ 4.58 | $ 3.69 |
Distributed income applicable to common stockholders | $ 1,947,000 | $ 1,562,000 | $ 1,024,000 |
Undistributed income from continuing operations applicable to common stockholders | $ 15,880,000 | $ 11,732,000 | $ 9,658,000 |
Weighted average number of shares from stock options (in shares) | |||
Conversion of Class B to Class A (in shares) | |||
Weighted average number of shares outstanding used to calculate diluted income per share (in shares) | 2,561 | 2,562 | 2,620 |
Diluted income from continuing operations per share available to common stockholders | $ 6,910 | $ 5,140 | $ 4,020 |
Diluted distributed income from continuing operations per share applicable to common stockholders (in dollars per share) | $ (0.76) | $ (0.61) | $ (0.39) |
Diluted undistributed income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.15 | $ 4.53 | $ 3.63 |
Income from continuing operations applicable to common stockholders | $ 182,999,000 | $ 135,540,000 | $ 105,214,000 |
Weighted average number of shares out-standing used to calculate basic income per share (in shares) | 26,290 | 26,121 | 25,805 |
Basic income from continuing operations per share applicable to common stockholders (in dollars per share) | $ 6.96 | $ 5.19 | $ 4.08 |
Weighted average number of shares outstanding used to calculate diluted income per share (in shares) | 26,490 | 26,382 | 26,191 |
Note 18 - Equity-method Inve101
Note 18 - Equity-method Investment (Details Textual) - NMTC Program [Member] - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | 24 Months Ended |
Oct. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2015 | |
Equity Method Investment, Ownership Percentage | 99.90% | ||
Payments to Acquire Equity Method Investments | $ 4.1 | $ 22.8 | $ 26.9 |
Equity Method Investment Equity Contribution Obligation | $ 49.8 | ||
Equity Method Investment Equity Contribution Obligation Term | 2 years |
Note 18 - Equity-method Inve102
Note 18 - Equity-method Investment Recorded in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Other Noncurrent Assets [Member] | ||
Carrying value, recorded as a component of other non-current assets | $ 22,284 | $ 33,282 |
Accrued Liabilities and Other Long Term Liabilities [Member] | ||
Present value of obligation associated with future equity contributions, recorded as a component of accrued liabilities and other long-term liabilities | $ 22,511 | $ 32,177 |
Note 18 - Equity-method Inve103
Note 18 - Equity-method Investment Recorded in Consolidated Statements of Operations (Details) - NMTC Program [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Asset impairments to write investment down to fair value | $ 16,521 | $ 1,853 | |
Our portion of the partnership’s operating losses | 6,929 | 1,160 | |
Non-cash interest expense related to the amortization of the discounted fair value of future equity contributions | 674 | 152 | |
Tax benefits and credits generated | $ 30,832 | $ 6,506 |
Note 19 - Certain Segment Finan
Note 19 - Certain Segment Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Operating Segments [Member] | Domestic [Member] | ||||
Revenues: | ||||
Revenues | $ 3,034,849 | $ 2,566,473 | $ 2,145,478 | |
Segment income*: | ||||
Segment income | [1] | 115,525 | 96,888 | 84,500 |
Floor plan interest expense: | ||||
Floor plan interest expense | 20,970 | 17,852 | 15,223 | |
Operating Segments [Member] | Import [Member] | ||||
Revenues: | ||||
Revenues | 3,334,983 | 1,893,034 | 1,225,800 | |
Segment income*: | ||||
Segment income | [1] | 98,371 | 50,870 | 40,264 |
Floor plan interest expense: | ||||
Floor plan interest expense | 15,051 | 9,439 | 6,475 | |
Operating Segments [Member] | Luxury [Member] | ||||
Revenues: | ||||
Revenues | 1,490,632 | 926,856 | 629,521 | |
Segment income*: | ||||
Segment income | [1] | 36,391 | 25,448 | 16,133 |
Floor plan interest expense: | ||||
Floor plan interest expense | 9,096 | 5,098 | 3,931 | |
Operating Segments [Member] | Corporate and Other [Member] | ||||
Floor plan interest expense: | ||||
Floor plan interest expense | 25,583 | 18,528 | 13,256 | |
Operating Segments [Member] | ||||
Revenues: | ||||
Revenues | 7,860,464 | 5,386,363 | 4,000,799 | |
Segment income*: | ||||
Segment income | [1] | 250,287 | 173,206 | 140,897 |
Floor plan interest expense: | ||||
Floor plan interest expense | 45,117 | 32,389 | 25,629 | |
Corporate, Non-Segment [Member] | ||||
Revenues: | ||||
Revenues | 3,788 | 3,963 | 4,950 | |
Segment income*: | ||||
Segment income | [1] | 74,514 | 71,195 | 50,283 |
Revenues | 7,864,252 | 5,390,326 | 4,005,749 | |
Segment income | [1] | 262,704 | 210,495 | 165,788 |
Depreciation and amortization | (41,600) | (26,363) | (20,035) | |
Other interest expense | (19,491) | (10,742) | (8,350) | |
Other (expense) income, net | (1,006) | 3,199 | 2,993 | |
Floor plan interest expense: | ||||
Floor plan interest expense | $ 19,534 | $ 13,861 | $ 12,373 | |
[1] | Segment income for each of the segments is defined as Income from continuing operations before income taxes, depreciation and amortization, other interest expense and other (expense) income, net. |
Note 19 - Segment Assets (Detai
Note 19 - Segment Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Operating Segments [Member] | Domestic [Member] | ||
Total assets: | ||
Assets | $ 985,374 | $ 829,721 |
Operating Segments [Member] | Import [Member] | ||
Total assets: | ||
Assets | 725,011 | 698,015 |
Operating Segments [Member] | Luxury [Member] | ||
Total assets: | ||
Assets | 475,305 | 405,222 |
Operating Segments [Member] | Corporate and Other [Member] | ||
Total assets: | ||
Assets | 1,041,609 | 947,974 |
Assets | $ 3,227,299 | $ 2,880,932 |
Note 21 - Subsequent Events (De
Note 21 - Subsequent Events (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | Feb. 26, 2016 | Feb. 22, 2016 | Feb. 01, 2016 | Jan. 26, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 |
Subsequent Event [Member] | Common Class A [Member] | Share Repurchase Plan [Member] | ||||||||
Stock Repurchased During Period, Shares | 594,123 | |||||||
Treasury Stock Acquired, Average Cost Per Share | $ 79.11 | |||||||
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased | 677,364 | |||||||
Subsequent Event [Member] | Common Class A [Member] | ||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.20 | |||||||
Subsequent Event [Member] | Common Class B [Member] | ||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.20 | |||||||
Subsequent Event [Member] | Riverside Subaru [Member] | ||||||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 3,600 | |||||||
Subsequent Event [Member] | Ira Toyota / Scion [Member] | ||||||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 6,500 | |||||||
Subsequent Event [Member] | ||||||||
Dividends, Common Stock, Cash | $ 5,100 | |||||||
Common Class A [Member] | Share Repurchase Plan [Member] | ||||||||
Treasury Stock Acquired, Average Cost Per Share | $ 107.88 | $ 70.52 | $ 40.76 | |||||
Common Class A [Member] | ||||||||
Stock Repurchased During Period, Shares | 228,737 | 226,729 | 127,900 | 1,700,000 | ||||
Treasury Stock Acquired, Average Cost Per Share | $ 41.34 | |||||||
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased | 1,300,000 | 1,300,000 | ||||||
Payments to Acquire Businesses, Net of Cash Acquired | $ 71,615 | $ 659,634 | $ 81,105 |