Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 12, 2020 | Jun. 30, 2019 | |
Document and Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 1-13395 | ||
Entity Registrant Name | SONIC AUTOMOTIVE, INC. | ||
Entity Central Index Key | 0001043509 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 56-2010790 | ||
Entity Address, Address Line One | 4401 Colwick Road | ||
Entity Address, City or Town | Charlotte | ||
Entity Address, State or Province | NC | ||
Entity Address, Postal Zip Code | 28211 | ||
City Area Code | 704 | ||
Local Phone Number | 566-2400 | ||
Title of 12(b) Security | Class A Common Stock, par value $0.01 per share | ||
Trading Symbol | SAH | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 682.4 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission in connection with the registrant's 2020 Annual Meeting of Stockholders are incorporated by reference in Part III of this Annual Report Form 10-K to the extent described herein. | ||
Class A Common stock | |||
Document and Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 30,532,640 | ||
Class B Common stock | |||
Document and Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 12,029,375 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Current Assets: | ||
Cash and cash equivalents | $ 29,103 | $ 5,854 |
Receivables, net | 432,742 | 438,186 |
Inventories | 1,517,875 | 1,528,461 |
Other current assets | 37,890 | 20,886 |
Total current assets | 2,017,610 | 1,993,387 |
Property, Plant and Equipment, Net | 1,097,247 | 1,178,489 |
Goodwill | 475,791 | 509,592 |
Intangible Assets, Net (Excluding Goodwill) | 64,300 | 69,705 |
ROU assets | 337,842 | 0 |
Finance Lease, Right-of-Use Asset | 34,691 | 0 |
Other Assets | 43,554 | 45,634 |
Total Assets | 4,071,035 | 3,796,807 |
Current Liabilities: | ||
Notes payable - floor plan - trade | 860,871 | 821,074 |
Notes payable - floor plan - non-trade | 678,223 | 712,966 |
Trade accounts payable | 135,217 | 114,263 |
Operating Lease, Liability, Current | 43,332 | 0 |
Finance Lease, Liability, Current | 1,564 | 0 |
Accrued interest | 10,830 | 13,417 |
Other accrued liabilities | 266,211 | 257,823 |
Current maturities of long-term debt | 69,908 | 26,304 |
Total current liabilities | 2,066,156 | 1,945,847 |
Long-Term Debt | 636,978 | 918,779 |
Other Long-Term Liabilities | 73,746 | 75,887 |
Operating Lease, Liability, Noncurrent | 304,151 | 0 |
Finance Lease, Liability, Noncurrent | 36,313 | 0 |
Deferred Income Taxes | 8,927 | 33,178 |
Commitments and Contingencies | ||
Stockholders’ Equity: | ||
Class A Convertible Preferred Stock, none issued | 0 | 0 |
Paid-in capital | 755,904 | 745,052 |
Retained earnings | 790,158 | 670,691 |
Accumulated other comprehensive income (loss) | (2,062) | 4,233 |
Treasury stock, at cost; 33,476,159 Class A common stock shares held at December 31, 2018 and 32,290,493 Class A common stock shares held at December 31, 2017 | (600,004) | (597,623) |
Total Stockholders’ Equity | 944,764 | 823,116 |
Total Liabilities and Stockholders’ Equity | 4,071,035 | 3,796,807 |
Dividends, Common Stock | 12,430 | |
Finance Lease, Right-of-Use Asset | 34,691 | 0 |
Retained Earnings | ||
Stockholders’ Equity: | ||
Total Stockholders’ Equity | 790,158 | 670,691 |
Class A common stock | ||
Stockholders’ Equity: | ||
Common stock, value | 647 | 642 |
Dividends, Common Stock | 7,346 | |
Class A common stock | Retained Earnings | ||
Stockholders’ Equity: | ||
Dividends, Common Stock | 12,430 | 7,346 |
Class B common stock | ||
Stockholders’ Equity: | ||
Common stock, value | 121 | 121 |
Dividends, Common Stock | 4,812 | 2,887 |
Class B common stock | Retained Earnings | ||
Stockholders’ Equity: | ||
Dividends, Common Stock | $ 4,812 | $ 2,887 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) | Dec. 31, 2019$ / sharesshares |
Convertible preferred stock issued | 0 |
Class A common stock | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 |
Common stock, shares authorized | 100,000,000 |
Treasury stock, shares | 33,600,000 |
Class B common stock | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 |
Common stock, shares authorized | 30,000,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||
Total revenues | $ 10,454,343,000 | $ 9,951,630,000 | $ 9,867,208,000 |
Cost of Sales: | |||
Total cost of sales | (8,933,326,000) | (8,505,505,000) | (8,409,532,000) |
Gross profit | 1,521,017,000 | 1,446,125,000 | 1,457,676,000 |
Selling, general and administrative expenses | (1,099,374,000) | (1,145,325,000) | (1,147,773,000) |
Impairment charges | (20,768,000) | (29,514,000) | (9,394,000) |
Depreciation and amortization | (93,169,000) | (93,623,000) | (88,944,000) |
Operating income (loss) | 307,706,000 | 177,663,000 | 211,565,000 |
Other income (expense): | |||
Interest expense, floor plan | (48,519,000) | (48,398,000) | (36,395,000) |
Interest expense, other, net | (52,953,000) | (54,059,000) | (52,524,000) |
Other income (expense), net | (6,589,000) | 106,000 | (14,522,000) |
Total other income (expense) | (108,061,000) | (102,351,000) | (103,441,000) |
Income (loss) from continuing operations before taxes | 199,645,000 | 75,312,000 | 108,124,000 |
Provision for income taxes for continuing operations - benefit (expense) | (55,108,000) | (22,922,000) | (13,971,000) |
Income (loss) from continuing operations | 144,537,000 | 52,390,000 | 94,153,000 |
Discontinued operations: | |||
Income (loss) from discontinued operations before taxes | (554,000) | (1,017,000) | (1,942,000) |
Provision for income taxes for discontinued operations - benefit (expense) | 154,000 | 277,000 | 772,000 |
Income (loss) from discontinued operations | (400,000) | (740,000) | (1,170,000) |
Net income (loss) | $ 144,137,000 | $ 51,650,000 | $ 92,983,000 |
Basic earnings (loss) per common share: | |||
Earnings (loss) per share from continuing operations (usd per share) | $ 3.36 | $ 1.23 | $ 2.14 |
Earnings (loss) per share from discontinued operations (usd per share) | (0.01) | (0.02) | (0.03) |
Earnings (loss) per common share (usd per share) | $ 3.35 | $ 1.21 | $ 2.11 |
Weighted average common shares outstanding (in shares) | 43,016 | 42,708 | 43,997 |
Diluted earnings (loss) per common share: | |||
Earnings (loss) per share from continuing operations (usd per share) | $ 3.31 | $ 1.22 | $ 2.12 |
Earnings (loss) per share from discontinued operations (usd per share) | (0.01) | (0.02) | (0.03) |
Earnings (loss) per common share (usd per share) | $ 3.30 | $ 1.20 | $ 2.09 |
Weighted average common shares outstanding (in shares) | 43,710 | 42,950 | 44,358 |
EchoPark Total Impairment [Member] | |||
Cost of Sales: | |||
Impairment charges | $ (19,667,000) | $ (1,582,000) | $ (1,903,000) |
Franchised Dealership Impairment [Member] | |||
Cost of Sales: | |||
Impairment charges | (1,101,000) | (27,932,000) | (7,491,000) |
New vehicles | |||
Revenues: | |||
Total revenues | 4,889,171,000 | 4,974,097,000 | 5,295,051,000 |
Cost of Sales: | |||
Total cost of sales | (4,656,084,000) | (4,732,595,000) | (5,030,125,000) |
Used vehicles | |||
Revenues: | |||
Total revenues | 3,489,972,000 | 2,973,498,000 | 2,622,053,000 |
Cost of Sales: | |||
Total cost of sales | (3,342,576,000) | (2,830,510,000) | (2,467,150,000) |
Wholesale vehicles | |||
Revenues: | |||
Total revenues | 202,946,000 | 217,625,000 | 171,064,000 |
Cost of Sales: | |||
Total cost of sales | (207,378,000) | (228,874,000) | (179,778,000) |
Total vehicles | |||
Revenues: | |||
Total revenues | 8,582,089,000 | 8,165,220,000 | 8,088,168,000 |
Cost of Sales: | |||
Total cost of sales | (8,206,038,000) | (7,791,979,000) | (7,677,053,000) |
Parts, service and collision repair | |||
Revenues: | |||
Total revenues | 1,395,303,000 | 1,380,887,000 | 1,416,010,000 |
Cost of Sales: | |||
Total cost of sales | (727,288,000) | (713,526,000) | (732,479,000) |
Finance, insurance and other, net | |||
Revenues: | |||
Total revenues | $ 476,951,000 | $ 405,523,000 | $ 363,030,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 144,137 | $ 51,650 | $ 92,983 |
Other comprehensive income (loss) before taxes: | |||
Change in fair value of interest rate swap and rate cap agreements | (3,819) | 2,173 | 6,186 |
Amortization of terminated interest rate swap agreements | (2,484) | (429) | 0 |
Pension actuarial income (loss) | (2,670) | 2,368 | (429) |
Total other comprehensive income (loss) before taxes | (8,973) | 4,112 | 5,757 |
Provision for income tax benefit (expense) related to components of other comprehensive income (loss) | 2,678 | (1,186) | (2,188) |
Other comprehensive income (loss) | (6,295) | 2,926 | 3,569 |
Comprehensive income (loss) | $ 137,842 | $ 54,576 | $ 96,552 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Class A common stock | Class A common stockCommon stock | Class A common stockTreasury Stock | Class A common stockRetained Earnings | Class B common stock | Class B common stockCommon stock | Class B common stockRetained Earnings |
Beginning Balance at Dec. 31, 2016 | $ 725,164 | $ 721,695 | $ 541,146 | $ (2,262) | $ 630 | $ (536,166) | $ 121 | ||||
Beginning Balance, Shares at Dec. 31, 2016 | 62,967 | 30,263 | 12,029 | ||||||||
Shares awarded under stock compensation plans | 45 | 40 | $ 5 | ||||||||
Shares awarded under stock compensation plans, shares | 490 | ||||||||||
Purchases of treasury stock | (37,347) | $ (37,347) | |||||||||
Purchases of treasury stock, shares | (2,027) | ||||||||||
Change in fair value of interest rate swap and rate cap agreements net of tax expense | 3,835 | 3,835 | |||||||||
Pension accrual income, net of tax | (266) | (266) | |||||||||
Restricted stock amortization | 11,119 | 11,119 | |||||||||
Net income (loss) | 92,983 | 92,983 | |||||||||
Dividends declared | (6,367) | $ (6,367) | $ (2,406) | $ (2,406) | |||||||
Ending Balance at Dec. 31, 2017 | 786,760 | 732,854 | 625,356 | 1,307 | $ 635 | $ (573,513) | $ 121 | ||||
Ending Balance, Shares at Dec. 31, 2017 | 63,457 | 32,290 | 12,029 | ||||||||
Net income (loss) | 144,137 | 144,137 | |||||||||
Beginning Balance at Dec. 31, 2017 | 786,760 | 732,854 | 625,356 | 1,307 | $ 635 | $ (573,513) | $ 121 | ||||
Beginning Balance, Shares at Dec. 31, 2017 | 63,457 | 32,290 | 12,029 | ||||||||
Shares awarded under stock compensation plans | 352 | 345 | $ 7 | ||||||||
Shares awarded under stock compensation plans, shares | 740 | ||||||||||
Purchases of treasury stock | (24,110) | $ (24,110) | |||||||||
Purchases of treasury stock, shares | (1,186) | ||||||||||
Change in fair value of interest rate swap and rate cap agreements net of tax expense | 1,284 | 1,284 | |||||||||
Pension accrual income, net of tax | 1,642 | 1,642 | |||||||||
Restricted stock amortization | 11,853 | 11,853 | |||||||||
Net income (loss) | 51,650 | 51,650 | |||||||||
Dividends declared | $ (7,346) | (7,346) | (2,887) | (2,887) | |||||||
Ending Balance at Dec. 31, 2018 | 823,116 | 745,052 | 670,691 | 4,233 | $ 642 | $ (597,623) | $ 121 | ||||
Ending Balance, Shares at Dec. 31, 2018 | 64,197 | 33,476 | 12,029 | ||||||||
Cumulative effect of change in accounting principle (1) | (7,428) | (7,428) | |||||||||
Shares awarded under stock compensation plans | 60 | 55 | $ 5 | ||||||||
Shares awarded under stock compensation plans, shares | 537 | ||||||||||
Purchases of treasury stock | (2,381) | $ (2,381) | |||||||||
Purchases of treasury stock, shares | (153) | ||||||||||
Change in fair value of interest rate swap and rate cap agreements net of tax expense | (4,359) | (4,359) | |||||||||
Pension accrual income, net of tax | (1,936) | (1,936) | |||||||||
Restricted stock amortization | 10,797 | 10,797 | |||||||||
Net income (loss) | 144,137 | ||||||||||
Dividends declared | (12,430) | $ (12,430) | $ (4,812) | $ (4,812) | |||||||
Ending Balance at Dec. 31, 2019 | $ 944,764 | $ 755,904 | $ 790,158 | $ (2,062) | $ 647 | $ (600,004) | $ 121 | ||||
Ending Balance, Shares at Dec. 31, 2019 | 64,734 | 33,629 | 12,029 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Tax effect on fair value of interest rate swap and rate cap agreements | $ (1,944) | $ 460 | $ 2,351 |
Tax expense (benefit) associated with change in pension actuarial (income) loss | $ (734) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income (loss) | $ 144,137,000 | $ 51,650,000 | $ 92,983,000 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and amortization of property and equipment | 89,949,000 | 93,617,000 | 88,938,000 |
Provision for bad debt expense | 522,000 | 531,000 | 748,000 |
Other amortization | 5,000 | 617,000 | 649,000 |
Debt issuance cost amortization | 2,478,000 | 2,418,000 | 2,383,000 |
Debt discount amortization, net of premium amortization | 0 | 0 | 157,000 |
Stock-based compensation expense | 10,797,000 | 11,853,000 | 11,119,000 |
Deferred income taxes | (20,845,000) | (20,606,000) | (27,760,000) |
Net distributions from equity investee | (101,000) | (225,000) | (138,000) |
Asset impairment charges | 20,768,000 | 29,514,000 | 9,394,000 |
Loss (gain) on disposal of dealerships and property and equipment | (75,318,000) | (43,164,000) | (10,194,000) |
Loss (gain) on exit of leased dealerships | (170,000) | 1,709,000 | 2,157,000 |
Gain (Loss) on Extinguishment of Debt | 6,690,000 | 0 | 14,607,000 |
Changes in assets and liabilities that relate to operations: | |||
Receivables | 4,652,000 | 50,351,000 | (52,989,000) |
Inventories | (78,523,000) | (78,701,000) | 57,250,000 |
Other assets | 47,472,000 | 11,288,000 | 3,266,000 |
Notes payable - floor plan - trade | 39,797,000 | 16,836,000 | (46,299,000) |
Trade accounts payable and other liabilities | (21,396,000) | 15,987,000 | 16,612,000 |
Total adjustments | 26,777,000 | 92,025,000 | 69,900,000 |
Net cash provided by (used in) operating activities | 170,914,000 | 143,675,000 | 162,883,000 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchase of businesses, net of cash acquired | 0 | 0 | (76,610,000) |
Purchases of land, property and equipment | (125,576,000) | (163,619,000) | (234,245,000) |
Proceeds from sales of property and equipment | 10,841,000 | 19,554,000 | 596,000 |
Proceeds from sales of dealerships | 250,711,000 | 128,734,000 | 38,150,000 |
Proceeds from Life Insurance Policy | 805,000 | 0 | 0 |
Net cash provided by (used in) investing activities | 136,781,000 | (15,331,000) | (272,109,000) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Net (repayments) borrowings on notes payable - floor plan - non-trade | (34,743,000) | 3,868,000 | 33,745,000 |
Borrowings on revolving credit facilities | 482,488,000 | 918,967,000 | 327,070,000 |
Repayments on revolving credit facilities | (482,488,000) | (993,967,000) | (252,070,000) |
Proceeds from issuance of long-term debt | 109,088,000 | 21,072,000 | 302,483,000 |
Debt issuance costs | (1,427,000) | (144,000) | (4,855,000) |
Principal payments and repurchase of long-term debt | (40,274,000) | (45,053,000) | (36,836,000) |
Repurchase of debt securities | (294,095,000) | 0 | (210,914,000) |
Finance Lease, Right-of-Use Asset, Amortization | 5,181,000 | 0 | 0 |
Purchases of treasury stock | (2,381,000) | (24,110,000) | (37,347,000) |
Issuance of shares under stock compensation plans | 60,000 | 352,000 | 45,000 |
Dividends paid | (15,493,000) | (9,827,000) | (8,851,000) |
Net cash provided by (used in) financing activities | (284,446,000) | (128,842,000) | 112,470,000 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 23,249,000 | (498,000) | 3,244,000 |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 5,854,000 | 6,352,000 | 3,108,000 |
CASH AND CASH EQUIVALENTS, END OF YEAR | 29,103,000 | 5,854,000 | 6,352,000 |
SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES: | |||
Change in fair value of interest rate swap and rate cap agreements (net of tax expense of $460, $2,351 and $2,178 in the years ended December 31, 2018, 2017 and 2016, respectively) | (4,359,000) | 1,284,000 | 3,835,000 |
Cash paid (received) during the period for: | |||
Interest, including amount capitalized | 104,204,000 | 98,126,000 | 89,525,000 |
Income taxes | $ 72,752,000 | $ 35,217,000 | $ 42,907,000 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Cash Flows [Abstract] | |||
Tax effect on fair value of interest rate swap and rate cap agreements | $ (1,944) | $ 460 | $ 2,351 |
Statement of Income (Statement)
Statement of Income (Statement) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||||||
Lease exit accrual adjustments and charges | $ 2,600 | $ 4,800 | |||||
Nonrecurring Compensation Expense | $ 6,300 | $ 23,300 | $ 9,200 | $ 32,500 | |||
Pre-tax charge related to the extinguishment of debt | $ 7,200 | $ (6,690) | $ 0 | $ (14,607) |
Business Acquisitions and Dispo
Business Acquisitions and Dispositions | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Business Acquisitions and Dispositions | Business Acquisitions and Dispositions Acquisitions We did not acquire any businesses during 2019 or 2018. We opened one new EchoPark store in California during 2019 and opened one manufacturer-awarded luxury franchised dealership and three new EchoPark stores in 2018. We acquired one pre-owned business (that was subsequently converted to an EchoPark store) for approximately $76.6 million during 2017. Acquisitions are included in the consolidated financial statements from the date of acquisition. Dispositions We disposed of one luxury franchised dealership and nine mid-line import franchised dealerships in 2019, which generated net cash from dispositions of approximately $250.7 million. We disposed of two luxury franchised dealerships and five mid-line import franchised dealerships in 2018, which generated net cash from dispositions of approximately $128.7 million. Additionally, we terminated one luxury franchised dealership and ceased operations at a previously acquired pre-owned store in Florida and four stores in our EchoPark Segment in 2018. We disposed of one domestic franchised dealership and two mid-line import franchised dealerships in 2017, which generated net cash from dispositions of approximately $38.2 million. In conjunction with dealership dispositions, we have agreed to indemnify the buyers from certain liabilities and costs arising from operations or events that occurred prior to sale but which may or may not have been known at the time of sale, including environmental liabilities and liabilities resulting from the breach of representations or warranties made under the agreements. See Note 12, “Commitments and Contingencies,” for further discussion. Prior to our adoption of ASU 2014-08 beginning with our Quarterly Report on Form 10-Q for the period ended June 30, 2014, individual dealership franchises sold, terminated or classified as held for sale were reported as discontinued operations. The results of operations of these dealership franchises sold or terminated on or prior to March 31, 2014 are reported as discontinued operations for all periods presented. Dealership franchises sold after March 31, 2014 have not been reclassified to discontinued operations since they did not meet the criteria in ASU 2014-08. Income (loss) from operations and lease exit accrual adjustments and charges associated with disposed dealerships classified as discontinued operations were as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Income (loss) from operations before taxes $ (554) $ (610) $ (735) Lease exit accrual adjustments and charges — (407) (1,207) Income (loss) from discontinued operations before taxes $ (554) $ (1,017) $ (1,942) Revenues and other operating results associated with disposed dealerships that remain in continuing operations were as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Income (loss) from operations before taxes and items below $ 3,154 $ (4,313) $ (736) Gain (loss) on disposal of dealerships (1) 76,461 39,307 9,974 Lease exit accrual adjustments and charges 170 210 (1,207) Impairment charges — (4,180) (318) Income (loss) before taxes $ 79,785 $ 31,024 $ 7,713 Total revenues $ 307,849 $ 783,275 $ 1,140,514 (1) Included in selling, general and administrative expenses in the accompanying consolidated statements of income. In the ordinary course of business, we evaluate our dealership franchises for possible disposition based on various strategic and performance criteria. As of December 31, 2019, we did not have any franchises classified as held for sale; however, in the future, we may sell franchises that are not currently held for sale. |
Inventories and Related Notes P
Inventories and Related Notes Payable - Floor Plan | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories and Related Notes Payable - Floor Plan | Inventories and Related Notes Payable - Floor Plan Inventories consist of the following: December 31, 2019 December 31, 2018 (In thousands) New vehicles $ 983,123 $ 1,027,727 Used vehicles 319,791 293,179 Service loaners 152,278 141,542 Parts, accessories and other 62,683 66,013 Net inventories $ 1,517,875 $ 1,528,461 We finance all of our new and certain of our used vehicle inventory through standardized floor plan facilities with either a syndicate of financial institutions and manufacturer-affiliated finance companies or directly with individual manufacturer-affiliated finance companies and other lending institutions. The new and used vehicle floor plan facilities bear interest at variable rates based on either LIBOR or prime rates, depending on the lender arrangement. The weighted average interest rate for our new vehicle floor plan facilities was 3.03%, 3.10% and 2.37% for 2019, 2018 and 2017, respectively. Our floor plan interest expense related to the new vehicle floor plan arrangements is partially offset by amounts received from manufacturers in the form of floor plan assistance capitalized in inventory and charged against cost of sales when the associated inventory is sold. For 2019, 2018 and 2017, we recognized a reduction in cost of sales of approximately $41.5 million, $42.2 million and $45.3 million, respectively, related to manufacturer floor plan assistance. The weighted average interest rate for our used vehicle floor plan facilities was 3.10%, 2.98% and 2.61% for 2019, 2018 and 2017, respectively. The new and used vehicle floor plan facilities are collateralized by vehicle inventory and other assets, excluding goodwill and other intangible assets, of the relevant dealership subsidiary. The new and used vehicle floor plan facilities contain a number of covenants, including, among others, covenants restricting us with respect to the creation of liens and changes in ownership, officers and key management personnel. We were in compliance with all of these restrictive covenants as of December 31, 2019. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment, net consists of the following: December 31, 2019 December 31, 2018 (In thousands) Land $ 373,301 $ 381,527 Building and improvements (1) 969,609 989,872 Furniture, fixtures and equipment 346,260 330,149 Construction in progress 50,928 59,523 Total, at cost 1,740,098 1,761,071 Less accumulated depreciation (616,611) (575,720) Subtotal 1,123,487 1,185,351 Less assets held for sale (2) (26,240) (6,862) Property and equipment, net $ 1,097,247 $ 1,178,489 (1) As discussed in Note 1, “Description of Business and Summary of Significant Accounting Policies,” due to the adoption of ASC 842, “Leases,” effective January 1, 2019, previously existing capital lease assets have been reclassified from property and equipment, net to financing - right-of- use assets in the accompanying consolidated balance sheet as of December 31, 2019. (2) Classified in other current assets in the accompanying consolidated balance sheets. Interest capitalized in conjunction with construction projects and software development was approximately $1.6 million, $1.5 million and $2.2 million for 2019, 2018 and 2017, respectively. As of December 31, 2019, commitments for facility construction projects totaled approximately $18.0 million. During 2019, 2018 and 2017, property and equipment impairment charges were recorded as noted in the following table: Franchised Dealerships Segment EchoPark Segment Consolidated Year Ended December 31, (In thousands) 2019 $ 1,101 $ 19,667 $ 20,768 2018 $ 25,832 $ 1,582 $ 27,414 2017 $ 3,890 $ 1,004 $ 4,894 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill The changes in the carrying amount of franchise assets and goodwill for 2019 and 2018 were as follows: Franchise Assets Net Goodwill (In thousands) Balance at December 31, 2017 $ 69,900 $ 525,780 (1) Reductions from dispositions (2,100) (16,188) Reductions from impairment (2,100) — Balance at December 31, 2018 $ 65,700 $ 509,592 (1) Reductions from dispositions (1,400) (33,801) Balance at December 31, 2019 $ 64,300 $ 475,791 (1) (1) Net of accumulated impairment losses of $797.6 million. Other Intangible Assets Other intangible assets consist of franchise assets and definite life intangible assets, and are presented net of accumulated amortization on the accompanying consolidated balance sheets. Pursuant to applicable accounting pronouncements, we evaluate our franchise assets and definite life intangible assets for impairment annually (as of October 1 of each year) or more frequently if indications of impairment exist. There were no franchise asset impairment charges for 2019 and $2.1 million for 2018, which was recorded in continuing operations based on the impairment evaluations performed. As discussed below in Note 16, “Leases,” due to the adoption of ASC 842, “Leases,” effective January 1, 2019, previously existing definite life intangible assets have been reclassified from other intangible assets, net to right-of-use assets in the accompanying consolidated balance sheet as of December 31, 2019. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision for income taxes for continuing operations - benefit (expense) consists of the following: Year Ended December 31, 2019 2018 2017 (In thousands) Current: Federal $ (62,016) $ (37,028) $ (34,877) State (12,563) (7,411) (7,292) Total current (74,579) (44,439) (42,169) Deferred 19,471 21,517 28,198 Total provision for income taxes for continuing operations - benefit (expense) $ (55,108) $ (22,922) $ (13,971) The provision for income taxes for continuing operations - benefit (expense) includes a benefit of $28.4 million related to the remeasurement of the net deferred tax liability as of December 31, 2017, due to a reduction in the U.S. statutory federal income tax rate from 35.0% to 21.0% (beginning in 2018) resulting from enactment of the Tax Act which was signed into law in December 2017. The effect of this benefit is shown separately in the following rate reconciliation table. The reconciliation of the U.S. statutory federal income tax rate with our federal and state overall effective income tax rate from continuing operations is as follows: Year Ended December 31, 2019 2018 2017 U.S. statutory federal income tax rate 21.00 % 21.00 % 35.00 % Effective state income tax rate 4.10 % 4.60 % 4.58 % Valuation allowance adjustments (0.18) % 0.20 % (0.59) % Uncertain tax positions (0.45) % 0.17 % 0.71 % Effect of change in future U.S. statutory federal income tax rate 0.00 % 0.00 % (26.27) % Non-deductible compensation 1.48 % 3.06 % 0.23 % Other 1.65 % 1.41 % (0.74) % Effective income tax rate 27.60 % 30.44 % 12.92 % Deferred income taxes reflect the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purposes. Significant components of our deferred tax assets and liabilities are as follows: December 31, 2019 December 31, 2018 (In thousands) Deferred tax assets: Accruals and reserves $ 27,271 $ 24,948 State net operating loss carryforwards 10,771 12,687 Basis difference in property and equipment 20,923 11,515 Interest and state taxes associated with the liability for uncertain income tax positions 938 1,175 Fair value of interest rate swaps and interest rate caps 1,153 — Basis difference in liabilities related to right-of-use assets 93,808 — Other 2,146 1,778 Total deferred tax assets 157,010 52,103 Deferred tax liabilities: Fair value of interest rate swaps and caps — (462) Basis difference in inventories (804) (838) Basis difference in goodwill (61,397) (69,646) Basis difference in right-of-use assets (90,679) — Other (2,316) (2,544) Total deferred tax liabilities (155,196) (73,490) Valuation allowance (7,775) (8,138) Net deferred tax asset (liability) $ (5,961) $ (29,525) Net long-term deferred tax asset balances were approximately $3.0 million and $3.7 million at December 31, 2019 and 2018, respectively, and are recorded in other assets on the accompanying consolidated balance sheets. Net long-term deferred tax liability balances were approximately $8.9 million and $33.2 million at December 31, 2019 and 2018, respectively, and are recorded in deferred income taxes on the accompanying consolidated balance sheets. We have approximately $248.4 million in gross state net operating loss carryforwards that will expire between 2020 and 2039. Management reviews these carryforward positions, the time remaining until expiration and other opportunities to realize these carryforwards in making an assessment as to whether it is more likely than not that these carryforwards will be realized. The results of future operations, regulatory framework of the taxing authorities and other related matters cannot be predicted with certainty and, therefore, differences from the assumptions used in the development of management’s judgment could occur. As of December 31, 2019, we had recorded a valuation allowance amount of approximately $7.8 million related to certain state net operating loss carryforward deferred tax assets as we determined that we would not be able to generate sufficient state taxable income in the related entities to realize the accumulated net operating loss carryforward balances. At January 1, 2019, we had liabilities of approximately $5.5 million recorded related to unrecognized tax benefits. Included in the liabilities related to unrecognized tax benefits at January 1, 2019, was approximately $0.6 million related to interest and penalties which we have estimated may be paid as a result of our tax positions. It is our policy to classify the expense related to interest and penalties to be paid on underpayments of income taxes within income tax expense. A summary of the changes in the liability related to our unrecognized tax benefits is presented below. 2019 2018 2017 (In thousands) Unrecognized tax benefit liability, January 1 (1) $ 4,901 $ 4,645 $ 4,357 New positions — — 653 Prior period positions: Increases 1,795 7 491 Decreases (2,697) (199) (539) Increases from current period positions 582 714 692 Settlements (653) — — Lapse of statute of limitations (8) (69) (781) Other (81) (197) (228) Unrecognized tax benefit liability, December 31 (2) $ 3,839 $ 4,901 $ 4,645 (1) Excludes accrued interest and penalties of $0.6 million, $0.6 million and $0.8 million at January 1, 2019, 2018 and 2017, respectively. (2) Excludes accrued interest and penalties of $0.5 million, $0.6 million and $0.6 million at December 31, 2019, 2018 and 2017, respectively. Amount presented is net of state net operating losses of $0.0 million, $0.0 million and $0.1 million at December 31, 2019, 2018 and 2017, respectively. Approximately $3.8 million and $4.9 million of the unrecognized tax benefits as of December 31, 2019 and 2018, respectively, would ultimately affect the income tax rate if recognized. Included in the December 31, 2019 recorded liability is approximately $0.5 million related to interest and penalties which we have estimated may be paid as a result of our tax positions. We do not anticipate any significant changes in our unrecognized tax benefit liability within the next 12 months. Sonic and its subsidiaries are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. Sonic’s 2016 through 2019 U.S. federal income tax returns remain open to examination by the U.S. Internal Revenue Service. Sonic and its subsidiaries’ state income tax returns remain open to examination by state taxing authorities for years ranging from 2015 to 2019. The primary effect of the change in the U.S. federal income tax rate from 35.0% to 21.0%, as required by the Tax Act, related to the adjustment of deferred income tax balances. In periods prior to the year ended December 31, 2017, the income tax benefit or expense related to the reversal of deferred income tax assets and liabilities was expected to be realized at a federal income tax rate of 35.0%. Because of the Tax Act, the reversal of deferred income tax asset and liabilities in subsequent periods is recorded assuming a federal income tax rate of 21.0%. There were no significant provisional amounts considered in our recorded income tax balances at December 31, 2019. However, as the Tax Act was signed into law on December 22, 2017, clarifications of the Tax Act’s provisions may be issued at later dates that alter our understanding of the Tax Act’s provisions and thus may affect recorded income tax balances. Interpretations related to the Tax Act’s provisions concerning depreciation, interest and compensation deductibility could impact recorded income tax balances. |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties Certain of our dealerships purchase the zMAX micro-lubricant from Oil-Chem Research Corporation (“Oil-Chem”), a subsidiary of Speedway Motorsports, LLC f/k/a Speedway Motorsports Inc. (“Speedway Motorsports”), for resale to Fixed Operations customers of our dealerships in the ordinary course of business. Sonic’s Executive Chairman, Mr. O. Bruton Smith, is also the Executive Chairman of Speedway Motorsports, and Mr. Smith’s son, Mr. Marcus G. Smith, a director and a greater than 10% beneficial owner of Sonic, is the Chief Executive Officer and President and a director of Speedway Motorsports, and an Executive Vice President of Sonic Financial Corporation (“SFC”). Total purchases from Oil-Chem by our dealerships were approximately $1.6 million in both 2019 and 2018, and approximately $1.9 million in 2017. We also engaged in other transactions with various Speedway Motorsports subsidiaries, consisting primarily of (1) merchandise and apparel purchases from SMISC Holdings, LLC. (d/b/a SMI Properties) for approximately $0.9 million in each of 2019, 2018 and 2017; and (2) vehicle sales to various Speedway Motorsports subsidiaries for approximately $0.2 million in each of 2019, 2018 and 2017. We participate in various aircraft-related transactions with SFC, a privately held company controlled by Mr. O. Bruton Smith and his family. Such transactions include, but are not limited to, the use of aircraft owned by SFC for business-related travel by our executives, a management agreement with SFC for storage and maintenance of aircraft leased by us from |
Capital Structure and Per Share
Capital Structure and Per Share Data | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Capital Structure and Per Share Data | Capital Structure and Per Share Data Preferred Stock - We have 3,000,000 shares of “blank check” preferred stock authorized with such designations, rights and preferences as may be determined from time to time by our Board of Directors. Our Board of Directors has designated 300,000 shares of preferred stock as Class A Convertible Preferred Stock, par value $0.10 per share (the “Preferred Stock”), which is divided into 100,000 shares of Series I Preferred Stock, 100,000 shares of Series II Preferred Stock and 100,000 shares of Series III Preferred Stock. There were no shares of Preferred Stock issued or outstanding at December 31, 2019 or 2018. Common Stock - We have two classes of common stock. We have authorized 100,000,000 shares of Class A Common Stock at a par value of $0.01 per share. Class A Common Stock entitles its holder to one vote per share. We have also authorized 30,000,000 shares of Class B Common Stock at a par value of $0.01 per share. Class B Common Stock entitles its holder to 10 votes per share, except in certain circumstances. Each share of Class B Common Stock is convertible into one share of Class A Common Stock either upon voluntary conversion at the option of the holder, or automatically upon the occurrence of certain events, as provided in our charter. The two classes of common stock share equally in dividends and in the event of liquidation. Share Repurchases - Prior to December 31, 2019, our Board of Directors had authorized us to expend up to $695.0 million to repurchase shares of our Class A Common Stock. As of December 31, 2019, we had repurchased a total of approximately 33.6 million shares of Class A Common Stock at an average price per share of approximately $17.84 and had redeemed and retired 13,801.5 shares of the Preferred Stock at an average price of $1,000 per share. As of December 31, 2019, we had approximately $81.2 million remaining under our Board’s authorization. Per Share Data - The calculation of diluted earnings per share considers the potential dilutive effect of restricted stock units, restricted stock awards and stock options granted under Sonic’s stock compensation plans (and any non-forfeitable dividends paid on such awards), in addition to Class A Common Stock purchase warrants. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Substantially all of our employees are eligible to participate in a 401(k) plan. Contributions by us to our 401(k) plans were approximately $8.9 million, $9.2 million and $8.0 million in 2019, 2018 and 2017, respectively. Stock Compensation Plans We currently have two active stock compensation plans: the Sonic Automotive, Inc. 2012 Stock Incentive Plan (the “2012 Plan”) and the Sonic Automotive, Inc. 2012 Formula Restricted Stock and Deferral Plan for Non-Employee Directors (the “2012 Formula Plan”). Collectively, these plans are referred to as the “Stock Plans.” During the second quarter of 2012, our stockholders voted to approve the 2012 Plan and the 2012 Formula Plan, with authorization for issuance of 2,000,000 shares of Class A Common Stock and 300,000 shares of Class A Common Stock, respectively. During the second quarter of 2015, our stockholders voted to increase the number of shares of Class A Common Stock authorized for issuance under the 2012 Plan from 2,000,000 shares to 4,000,000 shares. During the second quarter of 2017, our stockholders voted to increase the number of shares of Class A Common Stock authorized for issuance under the 2012 Formula Plan from 300,000 shares to 500,000 shares. During the second quarter of 2019, our stockholders voted to increase the number of shares of Class A Common Stock authorized for issuance under the 2012 Plan from 4,000,000 shares to 6,000,000 shares. The Stock Plans were adopted by our Board of Directors in order to attract and retain key personnel. Under the 2012 Plan, options to purchase shares of Class A Common Stock may be granted to key employees of Sonic and its subsidiaries and to officers, directors, consultants and other individuals providing services to us. The options are granted at the fair market value of our Class A Common Stock at the date of grant, typically vest over a period ranging from six months to three years, are exercisable upon vesting and typically expire 10 years from the date of grant. The 2012 Plan also authorizes the issuance of restricted stock awards and restricted stock units. Restricted stock award and restricted stock unit grants under the 2012 Plan typically vest over a period ranging from one dividends on non-vested shares. Individuals holding restricted stock units as of December 31, 2019 granted under the 2012 Plan do not have voting or dividend rights. We issue new shares of Class A Common Stock to employees and directors to satisfy our option exercise and stock grant obligations. To offset the effects of these transactions, we have historically repurchased shares of our Class A Common Stock after considering cash flow, market conditions and other factors; however, there is no guarantee that this will occur in future periods. A summary of the status of the stock options related to the Stock Plans is presented below: Options Outstanding Exercise Price Per Share (Low - High) Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (In thousands, except per share data, term in years) Balance at December 31, 2018 33 $ 1.81 - 1.81 $ 1.81 0.3 $ 392 Exercised (33) $ 1.81 - 1.81 $ 1.81 Year Ended December 31, 2019 2018 2017 (In thousands) Intrinsic value of stock options exercised $ 426 $ 3,564 $ 425 We recognize compensation expense within selling, general and administrative expenses related to the stock options granted under the Stock Plans. No stock option compensation expense was recognized during 2019, 2018 or 2017, as all previous stock option grants were completely vested prior to December 31, 2012. A summary of the status of the non-vested restricted stock award and restricted stock unit grants related to the Stock Plans is presented below: Non-Vested Restricted Stock Awards and Restricted Stock Units Weighted Average Grant Date Fair Value per Share (In thousands, except per share data) Balance at December 31, 2018 2,161 $ 21.20 Granted 968 $ 13.38 Forfeited (295) $ 19.75 Vested (487) $ 18.82 Balance at December 31, 2019 2,347 $ 19.34 During 2019, approximately 911,000 restricted stock units were awarded to our executive officers and other key associates under the 2012 Plan. These awards were made in connection with establishing the objective performance criteria for 2019 incentive compensation and vest over three years. The majority of the restricted stock units awarded to executive officers and other key associates are subject to forfeiture, in whole or in part, based upon specified measures of Sonic’s earnings per share performance for 2019, continuation of employment and compliance with any restrictive covenants contained in an agreement between us and the respective executive officer or other key associate. Also in 2019, approximately 57,000 restricted stock awards were granted to our Board of Directors pursuant to the 2012 Formula Plan and vest on the earlier of the first anniversary of the grant date or the day before the next annual meeting of our stockholders, except to the extent that such grant is considered an interim grant for a newly elected non-employee director, in which case, restrictions on those shares expire on the first anniversary of the grant date. We recognized compensation expense within selling, general and administrative expenses related to restricted stock units and restricted stock awards of approximately $10.8 million, $11.9 million and $11.1 million in 2019, 2018 and 2017, respectively. Tax benefits recognized related to restricted stock unit and restricted stock award compensation expense were approximately $2.9 million, $3.0 million and $4.2 million for 2019, 2018 and 2017, respectively. Total compensation cost related to non-vested restricted stock units and restricted stock awards not yet recognized at December 31, 2019 was approximately $29.1 million and is expected to be recognized over a weighted average period of approximately 6.5 years. Supplemental Executive Retirement Plan On December 7, 2009, the Compensation Committee of our Board of Directors approved and adopted the Sonic Automotive, Inc. Supplemental Executive Retirement Plan (the “SERP”) to be effective as of January 1, 2010. The SERP is a non-qualified deferred compensation plan that is unfunded for federal tax purposes. The SERP included 12 active or former members of senior management at December 31, 2019. The purpose of the SERP is to attract and retain key members of management by providing a retirement benefit in addition to the benefits provided by our tax-qualified and other non-qualified deferred compensation plans. The following table sets forth the status of the SERP: Year Ended December 31, 2019 2018 Change in projected benefit obligation: (In thousands) Obligation at January 1 $ 13,326 $ 13,556 Service cost 1,731 1,933 Interest cost 575 470 Actuarial loss (gain) 2,641 (2,368) Amendments/settlements/curtailments loss (gain) — — Benefits paid (265) (265) Obligation at December 31 (1) $ 18,008 $ 13,326 Accumulated benefit obligation $ 13,694 $ 10,191 (1) For 2019, approximately $0.4 million is included in other accrued liabilities and approximately $17.6 million is included in other long-term liabilities in the accompanying consolidated balance sheets. For 2018, approximately $0.3 million is included in other accrued liabilities and approximately $13.0 million is included in other long-term liabilities in the accompanying consolidated balance sheets. Year Ended December 31, 2019 2018 (In thousands) Change in fair value of plan assets: Plan assets at January 1 $ — $ — Actual return on plan assets — — Employer contributions 265 265 Benefits paid (265) (265) Plan assets at December 31 — — Funded status recognized $ (18,008) $ (13,326) The following table provides the cost components of the SERP: Year Ended December 31, 2019 2018 (In thousands) Service cost $ 1,731 $ 1,933 Interest cost 575 470 Net pension expense (benefit) $ 2,306 $ 2,403 The weighted average assumptions used to determine the benefit obligation and net periodic benefit costs consist of: As of December 31, 2019 2018 Discount rate 2.99 % 4.36 % Rate of compensation increase 3.00 % 3.00 % The estimated future benefit payments expected to be paid for each of the next five years and the sum of the payments expected for the next five years thereafter are: Estimated Future Benefit Payments Year Ending December 31, (In thousands) 2020 $ 360 2021 $ 360 2022 $ 360 2023 $ 360 2024 $ 360 2025 - 2029 $ 2,414 Multiemployer Benefit Plan Five of our dealership subsidiaries in northern California currently make fixed-dollar contributions to the Automotive Industries Pension Plan (the “AI Pension Plan”) pursuant to collective bargaining agreements between our subsidiaries and the International Association of Machinists (the “IAM”) and the International Brotherhood of Teamsters (the “IBT”). The AI Pension Plan is a “multiemployer plan” as defined under the Employee Retirement Income Security Act of 1974, as amended, and our five dealership subsidiaries are among approximately 188 employers that are obligated to make contributions to the AI Pension Plan pursuant to collective bargaining agreements with the IAM, the IBT and other unions. The risks of participating in this multiemployer pension plan are different from single-employer plans in the following aspects: • assets contributed to the multiemployer pension plan by one employer may be used to provide benefits to employees of other participating employers; • if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; and • if we choose to stop participating in the multiemployer pension plan, we may be required to pay the plan an amount based on the underfunded status of the plan, referred to as a withdrawal liability. Our participation in the AI Pension Plan for 2019, 2018 and 2017 is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employee Identification Number (the “EIN”). Unless otherwise noted, the most recent Pension Protection Act of 2006 (the “PPA”) zone status available in the years ended December 31, 2019 and 2018 is for the plan’s year-end at December 31, 2018 and 2017, respectively. The zone status is based on information that we received from the AI Pension Plan. Among other factors, plans in the red zone are generally less than 65% funded (“Critical Status”), plans in the yellow zone are less than 80% funded and plans in the green zone are at least 80% funded. The “FIP/RP Status - Pending/Implemented” column indicates plans for which a Financial Improvement Plan (“FIP”) or a Rehabilitation Plan (“RP”) is either pending or has been implemented. The last column lists the expiration dates of the collective bargaining agreements to which the plan is subject. The number of employees covered by the AI Pension Plan decreased 1.0% from December 31, 2017 to December 31, 2018 and decreased 5.5% from December 31, 2018 to December 31, 2019, affecting the period-to-period comparability of the contributions for 2019, 2018 and 2017. Pension Protection Act Zone Status FIP/RP Status Sonic Contributions Surcharge Imposed Collective Bargaining Agreement Expiration Date Pension Fund EIN/Pension Plan Number 2019 2018 Pending /Implemented Year Ended December 31, 2019 2018 2017 (In thousands) AI Pension Plan 94-1133245 Red Red RP Implemented $181 $176 $171 Yes Between Our participating dealership subsidiaries were not listed in the AI Pension Plan’s Form 5500 as providing more than 5% of the total contributions for the plan years ended December 31, 2019 and December 31, 2018. In June 2006, we received information that the AI Pension Plan was substantially underfunded as of December 31, 2005. In July 2007, we received updated information that the AI Pension Plan continued to be substantially underfunded as of December 31, 2006, with the amount of such underfunding increasing versus year end 2005. In March 2008, the Board of Trustees of the AI Pension Plan |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements In determining fair value, we use various valuation approaches including market, income and/or cost approaches. “Fair Value Measurements and Disclosures” in the ASC establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of us. Unobservable inputs are inputs that reflect our assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 - Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access. Assets utilizing Level 1 inputs include marketable securities that are actively traded, including our stock or public bonds. Level 2 - Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. Assets and liabilities utilizing Level 2 inputs include cash flow swap instruments and deferred compensation plan balances. Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement. Asset and liability measurements utilizing Level 3 inputs include those used in estimating fair value of non-financial assets and non-financial liabilities in purchase acquisitions, those used in assessing impairment of right-of-use assets, property, plant and equipment and other intangibles and those used in the reporting unit valuation in the annual goodwill impairment evaluation. The availability of observable inputs can vary and is affected by a wide variety of factors. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment required by us in determining fair value is greatest for assets and liabilities categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed is determined based on the lowest level input (Level 3 being the lowest level) that is significant to the fair value measurement. Fair value is a market-based measure considered from the perspective of a market participant who holds the asset or owes the liability rather than an entity-specific measure. Therefore, even when market assumptions are not readily available, our own assumptions are set to reflect those that market participants would use in pricing the asset or liability at the measurement date. We use inputs that are current as of the measurement date, including during periods when the market may be abnormally high or abnormally low. Accordingly, fair value measurements can be volatile based on various factors that may or may not be within our control. Assets and liabilities recorded at fair value in the accompanying consolidated balance sheets as of December 31, 2019 and 2018 are as follows: Fair Value Based on Significant Other Observable Inputs (Level 2) December 31, 2019 December 31, 2018 (In thousands) Assets: Cash surrender value of life insurance policies (1) $ 32,799 $ 31,395 Cash flow swaps and interest rate caps designated as hedges (2) 97 4,839 Total assets $ 32,896 $ 36,234 Liabilities: Deferred compensation plan (3) $ 17,890 $ 19,848 Total liabilities $ 17,890 $ 19,848 (1) Included in other assets in the accompanying consolidated balance sheets. (2) As of December 31, 2019, approximately $0.1 million was included in other assets in the accompanying consolidated balance sheets. As of December 31, 2018, approximately $1.8 million and $3.0 million were included in other current assets and other assets, respectively, in the accompanying consolidated balance sheets. (3) Included in other long-term liabilities in the accompanying consolidated balance sheets. The carrying value of assets and liabilities measured at fair value on a non-recurring basis but not completely adjusted to fair value in the accompanying consolidated balance sheet as of December 31, 2019, are included in the table below. Certain components of long-lived assets held and used have been adjusted to fair value through impairment charges as discussed in Note 4, “Property and Equipment,” and Note 5, “Intangible Assets and Goodwill.” Significant Total Gains / (In thousands) Long-lived assets held and used (1) $ 7,286 $ (1,345) Assets held for sale (1) $ 23,030 $ (17,741) (1) See Note 1, “Description of Business and Summary of Significant Accounting Policies,” and Note 4, “Property and Equipment.” The fair values less costs to sell of long-lived assets or disposal groups held for sale are assessed each reporting period they remain classified as held for sale. Subsequent changes in the held for sale long-lived asset’s or disposal group’s fair value less cost to sell (increase or decrease) are reported as an adjustment to its carrying amount, except that the adjusted carrying amount cannot exceed the carrying amount of the long-lived asset or disposal group at the time it was initially classified as held for sale. (2) Excludes impairment loss of approximately $1.7 million related to long lived assets that were disposed during the year ended December 31, 2019. As of December 31, 2019 and 2018, the fair values of our financial instruments, including receivables, notes receivable from finance contracts, notes payable - floor plan, trade accounts payable, borrowings under the revolving credit facilities and certain mortgage notes, approximated their carrying values due either to length of maturity or existence of variable interest rates that approximate prevailing market rates. The fair value and carrying value of our fixed rate long-term debt were as follows: December 31, 2019 December 31, 2018 Fair Value Carrying Value Fair Value Carrying Value (In thousands) 5.0% Notes (1) $ — $ — $ 262,515 $ 289,273 6.125% Notes (1) $ 261,250 $ 250,000 $ 216,250 $ 250,000 Mortgage Notes (2) $ 195,962 $ 194,535 $ 218,402 $ 215,196 Other (2) $ — $ — $ 20,437 $ 20,588 (1) As determined by market quotations as of December 31, 2019 and 2018, respectively (Level 1). (2) As determined by DCF (Level 3). |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Exit Accruals A significant number of our dealership properties are leased under long-term operating lease arrangements. Prior to January 1, 2019, if leased properties were no longer being utilized in operations, we recorded lease exit accruals. These situations could include the relocation of an existing facility or the sale of a dealership when the buyer will not be subleasing the property for either the remaining term of the lease or for an amount equal to our obligation under the lease, or situations in which a facility is closed as a result of the associated franchise being terminated by us or the manufacturer and no other operations continue on the leased property. The lease exit accruals represented the present value of the lease payments, net of estimated sublease rentals, for the remaining life of the operating leases and other accruals necessary to satisfy lease commitments to the landlords. As of December 31, 2018, the net liability related to these lease exit accruals was approximately $4.6 million. As discussed in Note 16, “Leases” due to the adoption of ASC 842, “Leases,” effective January 1, 2019, previously existing lease exit accruals have been reclassified from other accrued liabilities and other long-term liabilities to a reduction in right-of-use assets in the accompanying consolidated balance sheet as of December 31, 2019. Beginning January 1, 2019, right-of-use assets have been evaluated for impairment consistent with the impairment guidance in ASC 842, “Leases,” and ASC 360, “Property, Plant, and Equipment,” which is similar to our historical practice of recording lease exit accruals. However, beginning January 1, 2019, instead of recording new lease exit accruals, the result would be the reduction of the related right-of-use asset as an impairment charge. A summary of the activity of operating lease exit accruals consists of the following: (In thousands) Balance at December 31, 2018 $ 4,634 Effect of adoption of ASC 842, “Leases” (4,634) Balance at December 31, 2019 $ — Many of our facility operating leases are subject to affirmative and financial covenant provisions related to a subordination and guaranty agreement executed with the landlord of many of our facility properties. The required financial covenants related to certain lease agreements are as follows: Covenant Minimum Consolidated Liquidity Ratio Minimum Consolidated Fixed Charge Coverage Ratio Maximum Consolidated Total Lease Adjusted Leverage Ratio Minimum EBTDAR to Rent Ratio Required ratio 1.05 1.20 5.75 1.50 December 31, 2019 actual 1.11 1.60 3.21 5.57 Guarantees and Indemnifications In accordance with the terms of our operating lease agreements, our dealership subsidiaries, acting as lessees, generally agree to indemnify the lessor from certain exposure arising as a result of the use of the leased premises, including environmental exposure and repairs to leased property upon termination of the lease. In addition, we have generally agreed to indemnify the lessor in the event of a breach of the lease by the lessee. In connection with dealership dispositions and facility relocations, certain of our subsidiaries have assigned or sublet to the buyer their interests in real property leases associated with such dealerships. In general, the subsidiaries retain responsibility for the performance of certain obligations under such leases, including rent payments and repairs to leased property upon termination of the lease, to the extent that the assignee or sublessee does not perform. In the event an assignee or a sublessee does not perform its obligations, Sonic remains liable for such obligations. In accordance with the terms of agreements entered into for the sale of our dealerships, we generally agree to indemnify the buyer from certain liabilities and costs arising subsequent to the date of sale, including environmental exposure and exposure resulting from the breach of representations or warranties made in accordance with the agreements. While our exposure with respect to environmental remediation and repairs is difficult to quantify, our maximum exposure associated with these general indemnifications was approximately $46.5 million at December 31, 2019. These indemnifications typically expire within a period of one We also guarantee the floor plan commitments of our 50%-owned joint venture, the amount of which was approximately $4.3 million at December 31, 2019. Legal Matters Sonic is involved, and expects to continue to be involved, in various legal and administrative proceedings arising out of the conduct of its business, including regulatory investigations and private civil actions brought by plaintiffs purporting to represent a potential class or for which a class has been certified. Although Sonic vigorously defends itself in all legal and administrative proceedings, the outcomes of pending and future proceedings arising out of the conduct of Sonic’s business, including litigation with customers, employment-related lawsuits, contractual disputes, class actions, purported class actions and actions brought by governmental authorities, cannot be predicted with certainty. An unfavorable resolution of one or more of these matters could have a material adverse effect on Sonic’s business, financial condition, results of operations, cash flows or prospects. Included in other accrued liabilities and other long-term liabilities in the accompanying consolidated balance sheet as of December 31, 2019 were approximately $1.2 million and $0.3 million, respectively, in reserves that Sonic was holding for pending proceedings. Included in other accrued liabilities and other long-term liabilities in the accompanying consolidated balance sheet as of December 31, 2018 were approximately $2.4 million for such reserves. Except as reflected in such reserves, Sonic is currently unable to estimate a range of reasonably possible loss, or a range of reasonably possible loss in excess of the amount accrued, for pending proceedings. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The changes in accumulated other comprehensive income (loss) by component for 2019 are as follows: Gains and (Losses) on Cash Flow Hedges Defined Benefit Pension Plan Total Accumulated Other Comprehensive Income (Loss) (In thousands) Balance at December 31, 2018 $ 3,034 $ 1,199 $ 4,233 Other comprehensive income (loss) before reclassifications (1) (1,646) (1,935) (3,581) Amounts reclassified out of accumulated other comprehensive income (loss) (2) (2,714) — (2,714) Net current-period other comprehensive income (loss) (4,360) (1,935) (6,295) Balance at December 31, 2019 $ (1,326) $ (736) $ (2,062) (1) Net of tax benefit of $836 related to gains on cash flow hedges and tax benefit of $734 related to the defined benefit pension plan. (2) Net of tax benefit of $1,108 related to gains on cash flow hedges. See the heading “Derivative Instruments and Hedging Activities” in Note 6, “Long-Term Debt,” for further discussion of our cash flow hedges. For further discussion of our defined benefit pension plan, see Note 10, “Employee Benefit Plans.” |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information As of December 31, 2019, we had two operating segments: (1) retail automotive franchises that sell new vehicles and buy and sell used vehicles, sell replacement parts, perform vehicle repair and maintenance services, and arrange finance and insurance products (the “Franchised Dealerships Segment”); and (2) pre-owned vehicle specialty retail locations that provide customers an opportunity to search our nationwide inventory, purchase a pre-owned vehicle, select finance and insurance products and sell their current vehicle to us (the “EchoPark Segment”). Sonic has determined that its operating segments also represent its reportable segments. The reportable segments identified above are the business activities of Sonic for which discrete financial information is available and for which operating results are regularly reviewed by our chief operating decision maker to assess operating performance and allocate resources. Sonic’s chief operating decision maker is a group of three individuals consisting of: (1) the Company’s Chief Executive Officer; (2) the Company’s President; and (3) the Company’s Chief Financial Officer. Reportable segment revenues, segment income (loss), impairment charges, depreciation and amortization, floor plan interest expense, interest expense, other, net, capital expenditures and assets are as follows: Year Ended December 31, 2019 2018 2017 Segment revenues (In thousands) Franchised Dealerships Segment revenues: New vehicles $ 4,889,171 $ 4,974,097 $ 5,295,051 Used vehicles 2,493,467 2,370,799 2,406,407 Wholesale vehicles 180,020 197,184 161,581 Parts, service and collision repair 1,366,550 1,364,559 1,401,802 Finance, insurance and other, net 363,117 344,814 348,058 Franchised Dealerships Segment revenues $ 9,292,325 $ 9,251,453 $ 9,612,899 EchoPark Segment revenues: Used vehicles $ 996,504 $ 602,698 $ 215,646 Wholesale vehicles 22,927 20,443 9,483 Parts, service and collision repair 28,753 16,327 14,208 Finance, insurance and other, net 113,834 60,709 14,972 EchoPark Segment revenues $ 1,162,018 $ 700,177 $ 254,309 Total consolidated revenues $ 10,454,343 $ 9,951,630 $ 9,867,208 Year Ended December 31, 2019 2018 2017 Segment income (loss) (1) (In thousands) Franchised Dealerships Segment (2) $ 211,267 $ 157,413 $ 138,468 EchoPark Segment (3) 9,146 (52,587) (20,950) Total segment income (loss) $ 220,413 $ 104,826 $ 117,518 Impairment charges (4) (20,768) (29,514) (9,394) Income (loss) from continuing operations before taxes $ 199,645 $ 75,312 $ 108,124 Retail new and used vehicle unit sales volume: Franchised Dealerships Segment 226,760 232,885 248,534 EchoPark Segment 49,520 29,437 10,618 Total retail new and used vehicle unit sales volume 276,280 262,322 259,152 (1) Segment income (loss) for each segment is defined as income (loss) from continuing operations before taxes and impairment charges. (2) For the year ended December 31, 2019, the above amount includes approximately $76.0 million of net gain on the disposal of franchised dealerships, offset partially by approximately $7.2 million of loss on the extinguishment of debt, approximately $6.3 million of executive transition costs and approximately $1.1 million of impairment charges. For the year ended December 31, 2018, the above amount includes approximately $38.9 million of net gain on the disposal of franchised dealerships, offset partially by approximately $27.9 million of impairment charges, approximately $4.0 million of storm-related physical damage costs, approximately $1.7 million of legal costs, approximately $1.6 million of executive transition costs and approximately $1.4 million of lease exit charges. For the year ended December 31, 2017, the above amount includes approximately $14.6 million of net loss on the extinguishment of debt, approximately $8.9 million of storm-related physical damage and legal costs, approximately $7.5 million of impairment charges, approximately $0.7 million of double-carry interest and approximately $0.3 million of lease exit charges, offset partially by approximately $10.0 million of net gain on the disposal of franchised dealerships. (3) For the year ended December 31, 2019, the above amount includes approximately $19.7 million of impairment charges related to building and land held for sale at former EchoPark locations. For the year ended December 31, 2018, the above amount includes approximately $32.5 million of long-term compensation-related charges and approximately $1.6 million of impairment charges. For the year ended December 31, 2017, the above amount includes approximately $1.9 million of impairment charges, approximately $1.3 million of long-term compensation-related charges, approximately $0.6 million of lease exit charges and approximately $0.2 million of storm-related physical damage and legal costs. (4) For the year ended December 31, 2019, the above amount includes approximately $1.1 million of impairment charges for the Franchised Dealerships Segment and approximately $19.7 million of impairment charges for the EchoPark Segment. For the year ended December 31, 2018, the above amount includes approximately $27.9 million of impairment charges for the Franchised Dealerships Segment and approximately $1.6 million of impairment charges for the EchoPark Segment. For the year ended December 31, 2017, the above amount includes approximately $7.5 million of impairment charges for the Franchised Dealerships Segment and approximately $1.9 million of impairment charges for the EchoPark Segment. Year Ended December 31, 2019 2018 2017 (In thousands) Impairment charges: Franchised Dealerships Segment $ 1,101 $ 27,932 $ 7,491 EchoPark Segment 19,667 1,582 1,903 Total impairment charges $ 20,768 $ 29,514 $ 9,394 Year Ended December 31, 2019 2018 2017 (In thousands) Depreciation and amortization: Franchised Dealerships Segment $ 82,636 $ 85,849 $ 83,741 EchoPark Segment 10,533 7,774 5,203 Total depreciation and amortization $ 93,169 $ 93,623 $ 88,944 Year Ended December 31, 2019 2018 2017 (In thousands) Floor plan interest expense: Franchised Dealerships Segment $ 45,055 $ 46,126 $ 35,030 EchoPark Segment 3,464 2,272 1,365 Total floor plan interest expense $ 48,519 $ 48,398 $ 36,395 Year Ended December 31, 2019 2018 2017 (In thousands) Interest expense, other, net: Franchised Dealerships Segment $ 51,231 $ 52,396 $ 51,548 EchoPark Segment 1,722 1,663 976 Total interest expense, other, net $ 52,953 $ 54,059 $ 52,524 Year Ended December 31, 2019 2018 2017 (In thousands) Capital expenditures: Franchised Dealerships Segment $ 89,332 $ 116,854 $ 195,220 EchoPark Segment 36,244 46,765 39,025 Total capital expenditures $ 125,576 $ 163,619 $ 234,245 December 31, 2019 2018 (In thousands) Assets: Franchised Dealerships Segment $ 3,797,878 $ 3,485,280 EchoPark Segment 244,054 305,673 Corporate and other: Cash and cash equivalents 29,103 5,854 Total assets $ 4,071,035 $ 3,796,807 |
Leases, Codification Topic 842
Leases, Codification Topic 842 | Jan. 01, 2019 |
Leases [Abstract] | |
Lessee, Operating Leases [Text Block] | 16. Leases The cumulative effect of the adoption of ASC 842, “Leases,” on our unaudited consolidated balance sheet as of January 1, 2019 was the recognition of right-of-use assets of approximately $406.9 million (including approximately $18.9 million related to capital leases that was reclassified from property and equipment, net in the accompanying consolidated balance sheet as of December 31, 2018) and related lease liabilities of approximately $419.5 million (including approximately $20.6 million related to capital leases that was reclassified from current maturities of long-term debt and long-term debt in the accompanying consolidated balance sheet as of December 31, 2018). Upon adoption of ASC 842, “Leases,” we evaluated right-of-use assets for impairment and determined that approximately $10.5 million of impairment was required related to newly recognized right-of-use assets that would have been impaired in previous periods. This impairment of the right-of-use assets as of January 1, 2019 was recorded, net of related income tax effects, as a $7.4 million reduction of beginning retained earnings. The adoption of ASC 842, “Leases,” did not have a material effect on our consolidated statements of income or our consolidated statements of cash flows. The effect of the adoption of ASC 842, “Leases,” on our unaudited consolidated balance sheet as of January 1, 2019 and our consolidated balance sheet as of December 31, 2019 was as follows: Before Impact of ASC 842 Effects of Adoption of ASC 842 After Impact of ASC 842 December 31, 2018 January 1, 2019 Balance Sheet (In thousands) Assets Property and Equipment, net $ 1,178,489 $ (18,948) $ 1,159,541 Other Intangible Assets, net 69,705 (4,005) 65,700 Right-of-Use Assets — 406,918 406,918 Liabilities Current lease liabilities $ — $ 48,832 $ 48,832 Other accrued liabilities 257,823 (1,987) 255,836 Long-Term Debt 918,779 (20,557) 898,222 Long-Term Lease Liabilities — 370,647 370,647 Other Long-Term Liabilities 75,887 (2,508) 73,379 Deferred Income Taxes 33,178 (3,034) 30,144 Stockholders’ Equity Retained earnings $ 670,691 $ (7,428) $ 663,263 Adoption New Modifications (1) Amortization As Reported December 31, 2019 (In thousands) Right-of-Use Assets Finance Leases $ 18,948 $ 121 $ 18,835 $ (3,213) $ 34,691 Operating Leases 387,970 10,081 (15,205) (45,004) 337,842 Total Right-of-Use Assets $ 406,918 $ 10,202 $ 3,630 $ (48,217) $ 372,533 Current Lease Liabilities Finance Leases $ 728 $ 12 $ 4,513 $ (3,689) $ 1,564 Operating Leases 48,104 1,560 (2,650) (3,682) 43,332 Total Current Lease Liabilities $ 48,832 $ 1,572 $ 1,863 $ (7,371) $ 44,896 Long-Term Lease Liabilities Finance Leases $ 19,829 $ 109 $ 17,867 $ (1,492) $ 36,313 Operating Leases 350,818 8,521 (12,400) (42,788) 304,151 Total Long-Term Lease Liabilities $ 370,647 $ 8,630 $ 5,467 $ (44,280) $ 340,464 (1) Includes the impact of remeasurements related to lease terminations and changes in assumptions around the probability of exercise of extension options. Twelve Months Ended December 31, 2019 Lease Expense (In thousands) Finance lease expense Reduction of right-of-use assets $ 3,213 Interest on lease liabilities 5,097 Operating lease expense (1) 68,367 Short-term lease expense (1) 1,570 Variable lease expense 2,120 Sublease income (14,207) Total $ 66,160 (1) Included in operating cash flows in the accompanying consolidated statements of cash flows. Twelve Months Ended December 31, 2019 Other Information (In thousands) Cash paid for amounts included in the measurement of lease liabilities Financing cash flows for finance leases $ 5,181 Operating cash flows for finance leases $ 5,097 Operating cash flows for operating leases $ 69,834 Right-of-use assets obtained in exchange for lease liabilities Finance leases $ 10,926 Operating leases (1) $ 22,055 (1) Includes the impact of reclassification of right-of-use assets from operating leases to finance leases due to remeasurement. December 31, 2019 Other Information Weighted-average remaining lease term (in years) Finance leases 11.8 Operating leases 9.5 Weighted-average discount rate Finance leases 18.74 % Operating leases 6.69 % Undiscounted Lease Cash Flows Under ASC 842 as of December 31, 2019 Finance Operating Receipts from Subleases Year Ending December 31, (In thousands) 2020 $ 6,608 $ 64,577 $ (10,795) 2021 6,760 58,093 (8,078) 2022 6,768 51,337 (6,103) 2023 6,829 49,689 (6,103) 2024 6,947 44,012 (5,042) Thereafter 43,787 215,240 (4,270) Total $ 77,699 $ 482,948 $ (40,391) Less: Present value discount (39,822) (135,465) Lease liabilities $ 37,877 $ 347,483 For comparison purposes, the following table provides the future minimum lease payments as presented in our Annual Report on Form 10-K for the year ended December 31, 2018 in accordance with ASC 840, “Leases.” Undiscounted Lease Cash Flows Under ASC 840 as of December 31, 2018 Finance Operating Receipts from Subleases Year Ending December 31, (In thousands) 2019 $ 6,985 $ 82,177 $ (13,430) 2020 7,165 66,023 (10,508) 2021 7,357 51,501 (8,534) 2022 7,374 37,152 (7,232) 2023 7,609 33,486 (7,013) Thereafter 48,239 127,026 (13,116) Total minimum lease payments (receipts) $ 84,729 $ 397,365 $ (59,833) Less: Present value discount (64,140) Lease liabilities $ 20,589 Current portion of lease liabilities $ 643 Long-term portion of lease liabilities $ 19,946 The majority of our leases are related to dealership properties that are subject to long-term lease arrangements. In addition, we have certain equipment leases and contracts containing embedded leased assets that have been evaluated and included in the right-of-use assets and lease liabilities above as appropriate. We recognize a right-of-use asset and a lease liability at the lease commencement date. For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. For finance leases, the lease liability is initially measured in the same manner and date as for operating leases and is subsequently measured at reduced cost using the effective interest method. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred or previously recognized favorable lease assets, less any lease incentives received or previously recognized lease exit accruals. For operating leases, the right-of-use asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term. For finance leases, the right-of-use asset is reduced using the straight-line method from the lease commencement date to the earlier of the end of its useful life or the end of the lease term unless the lease transfers ownership of the underlying asset to us or we are reasonably certain to exercise an option to purchase the underlying asset. In those cases, the right-of-use asset is reduced over the expected useful life of the underlying asset. Expense related to the reduction of the right-of-use asset is recognized and presented separately from interest expense on the lease liability. Variable lease payments associated with our leases are recognized when the event, activity or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented as operating expense in our consolidated statements of income in the same line item as expense arising from fixed lease payments (operating leases) or expense related to the reduction of the right-of-use asset (finance leases). Right-of-use assets for operating and finance leases are periodically reduced by impairment losses. We use the long-lived assets impairment guidance in ASC 360, “Property, Plant, and Equipment,” to determine whether right-of-use assets are impaired and, if so, the amount of the impairment loss to recognize. The Company monitors for events or changes in circumstances that require a reassessment of one of its leases. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding right-of-use asset unless doing so would reduce the carrying amount of the right-of-use asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative right-of-use asset balance is recorded in profit or loss. Key estimates and judgments related to the measurement and recording of right-of-use assets and lease liabilities include how we determine: (1) the discount rate used to discount the unpaid lease payments to present value; and (2) the expected lease term, including any extension options. ASC 842, “Leases,” requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, we cannot determine the interest rate implicit in the lease because we do not have access to the lessor’s estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, we generally use our incremental borrowing rate as the discount rate for the lease. We determined the discount rate for our leases based on the risk-free rate as of the measurement date for varying maturities corresponding to the remaining lease term, adjusted for the risk-premium attributed to Sonic’s corporate credit rating for a secured or collateralized instrument. Many of our lease arrangements have one or more existing renewal options to extend the lease term (typically in five- to 10-year increments), which were considered in the calculation of the right-of-use assets and lease liabilities if we determined that it was reasonably certain that an extension option would be exercised. The lease term for all of the Company’s leases includes the noncancellable period of the lease plus any additional periods covered by our option to extend the lease that we are reasonably certain to exercise. We determined the probability of the exercise of a lease extension option based on our long-term strategic business outlook and the condition and remaining useful life of the fixed assets at the location subject to the lease agreement, among other factors. The majority of our lease agreements require fixed monthly payments (subject to either specific or index-based escalations in future periods) while other agreements require variable lease payments based on changes in LIBOR or any replacement thereof. Lease payments included in the measurement of the lease liability comprise the: (1) fixed lease payments, including in-substance fixed payments, owed over the lease term, which include termination penalties we would owe if the estimated lease term assumes that we would be likely to exercise a termination option prior to the earliest expiration date; (2) variable lease payments that depend on an index or rate, initially measured using the index or rate at the lease commencement date; and (3) the exercise price of our option to purchase the underlying asset if we are reasonably certain to exercise the option. Our leases do not typically contain residual value guarantees. In certain situations, we have entered into sublease agreements whereby we sublease all or a portion of a leased real estate asset to a third party. To the extent that we have a sublease related to a lease agreement for an asset that we are no longer using in operations, we have reduced the right-of-use asset by any applicable net deficiency in expected cash flows from that sublease (either due to partial monthly sublease proceeds or a sublease term less than the remaining master lease term). As of December 31, 2018, the net liability related to these lease exit accruals was approximately $4.6 million as discussed in Note 12, “Commitments and Contingencies.” Upon the adoption of ASC 842, “Leases,” this balance was reclassified from other accrued liabilities and other long-term liabilities to a reduction in right-of-use assets in the accompanying consolidated balance sheet as of December 31, 2019. Prior to the adoption of ASC 842, “Leases,” we had recorded definite life intangible assets related to favorable lease assets acquired in business combinations. As of December 31, 2018, the net unamortized balance related to these definite life intangible assets was approximately $4.0 million. Upon adoption of ASC 842, “Leases,” this balance was reclassified from other intangible assets, net to right-of-use assets in the accompanying consolidated balance sheet as of December 31, 2019 and continues to be amortized over the remaining lease term. As part of the new lease standard implementation process, we assessed our existing real estate and equipment lease agreements, identified certain lease components embedded within existing service contracts, evaluated transition guidance and practical expedient elections, implemented lease accounting software and implemented internal controls over lease accounting under the new lease standard. |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Organization and Business | Organization and Business - Sonic Automotive, Inc. (“Sonic,” the “Company,” “we,” “us” or “our”) is one of the largest automotive retailers in the United States (as measured by total revenue). As a result of the way we manage our business, we had two reportable segments as of December 31, 2019: (1) the Franchised Dealerships Segment and (2) the EchoPark Segment. For management and operational reporting purposes, we group certain businesses together that share management and inventory (principally used vehicles) into “stores.” As of December 31, 2019, we operated 86 stores in the Franchised Dealerships Segment and nine stores in the EchoPark Segment. The Franchised Dealerships Segment consists of 99 new vehicle franchises (representing 21 different brands of cars and light trucks) and 15 collision repair centers in 12 states. The Franchised Dealerships Segment provides comprehensive services, including (1) sales of both new and used cars and light trucks; (2) sales of replacement parts and performance of vehicle maintenance, manufacturer warranty repairs, and paint and collision repair services (collectively, “Fixed Operations”); and (3) arrangement of extended warranties, service contracts, financing, insurance and other aftermarket products (collectively, “finance and insurance” or “F&I”) for our customers. The EchoPark Segment sells used cars and light trucks and arranges F&I product sales for our customers in pre-owned vehicle specialty retail locations. Our EchoPark business operates independently from our franchised dealerships business. |
Principles of Consolidation | Principles of Consolidation - All of our dealership and non-dealership subsidiaries are wholly owned and consolidated in the accompanying consolidated financial statements except for one 50%-owned dealership that is accounted for under the equity method. All material intercompany balances and transactions have been eliminated in the accompanying consolidated financial statements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements - In February 2016, the Financial Accounting Standards Board (the “FASB”) established Accounting Standards Codification (“ASC”) 842, “Leases,” by issuing Accounting Standards Update (“ASU”) 2016-02 (and subsequent amendments via ASU 2018-01, ASU 2018-10 and ASU 2018-11) in order to increase transparency and comparability among organizations by recognizing operating lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The new lease standard was effective for us on January 1, 2019. Prior to adoption of the new lease standard, only leases classified as capital leases under ASC Topic 840, “Leases,” were recorded in the consolidated balance sheets. Under ASC 842, “Leases,” we classify leases as either finance leases (formerly capital leases) or operating leases, and a right-of-use asset and lease liability are required to be recognized in the consolidated balance sheets for both finance and operating leases with a term longer than 12 months. The new lease standard required a modified retrospective transition approach and provides an optional transition method to either (1) record current existing leases as of the effective date; or (2) record leases existing as of the earliest comparative period presented in the financial statements by recasting comparative period financial statements. We adopted the new lease standard as of January 1, 2019 using the effective date as our date of application. As such, financial statement information and disclosures required under the new lease standard are not provided for dates and periods prior to January 1, 2019. The new lease standard provides for a number of optional practical expedients in transition, which include: (1) not requiring an entity to reassess prior conclusions about lease identification, lease classification or initial direct costs; (2) allowing an entity to use a portfolio approach for similar lease assets; (3) allowing an entity to elect an accounting policy to choose not to separate non-lease components of an agreement from lease components (by asset class); (4) allowing the use of hindsight in estimating lease term or assessing impairment of right-of-use assets; and (5) not requiring an entity to reassess prior conclusions about land easements. We elected all of the practical expedients permitted under the transition guidance within the new lease standard. The new lease standard also provides practical expedients for ongoing accounting. We elected the short-term lease recognition exemption for our real estate and equipment leases, which means that for those leases that qualify, we do not recognize right-of-use assets or lease liabilities and recognize the expense related to the short-term leases on a straight-line basis over the lease term and any variable lease payments in the period in which the obligation for those payments is incurred. We have also elected the practical expedient that allows us not to separate non-lease components of an agreement from lease components (for certain non-real estate assets). See Note 16, “Leases,” for further discussion on leases. In August 2017, the FASB issued ASU 2017-12, which amends the hedge accounting recognition and presentation requirements in ASC Topic 815, “Derivatives and Hedging.” This ASU expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. It also includes certain targeted improvements to simplify the application of current guidance related to hedge accounting. For public companies, this ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The adoption of this ASU did not materially impact our consolidated financial statements. In February 2018, the FASB issued ASU 2018-02, which allows the reclassification of stranded tax effects, as a result of the Tax Cuts and Jobs Acts of 2017 (the “Tax Act”), from accumulated other comprehensive income to retained earnings. For public companies, this ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The adoption of this ASU did not materially impact our consolidated financial statements. In June 2018, the FASB issued ASU 2018-07 to expand the scope of ASC Topic 718, “Compensation - Stock Compensation,” to include share-based payment transactions for acquiring goods and services from non-employees. For public companies, this ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The adoption of this ASU did not materially impact our consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (ASC Topic 326): Measurement of Credit Losses on Financial Instruments.” The amendment in this update replaced the previous incurred loss impairment methodology of recognizing credit losses when a loss is probable, with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to assess credit loss estimates. This ASU is effective for fiscal years beginning after December 15, 2019. We adopted this ASU as of January 1, 2020 and the effects of this ASU are not expected to materially impact our consolidated financial statements. |
Use of Estimates | Use of Estimates - The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires Sonic’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the accompanying consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates, particularly related to allowance for credit loss, realization of inventory values, intangible asset and deferred tax asset values, reserves for tax contingencies and legal matters, reserves for future commission revenue to be returned to the third-party provider for early termination of customer contracts (“chargebacks”), estimates of certain retrospective finance and insurance revenue, results reported as continuing and discontinued operations, insurance reserves, lease exit accruals and certain accrued expenses. |
Cash and Cash Equivalents | Cash and Cash Equivalents - We classify cash and all highly liquid investments with a maturity of three months or less at the date of purchase, including short-term time deposits and government agency and corporate obligations, as cash and cash equivalents. In the event that we are in a book overdraft cash position as of a reporting date, the book overdraft position is reclassified from cash and cash equivalents to trade accounts payable in the consolidated balance sheets and is reflected as activity in trade accounts payable and other liabilities in the consolidated statements of cash flows. We were not in a book overdraft position as of December 31, 2019 or 2018. |
Revenue Recognition | Revenue Recognition - As of January 1, 2018, we adopted ASC Topic 606 (ASC 606), “Revenue from Contracts with Customers.” Under this standard, revenue is recognized when a customer obtains control of promised goods or services and in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. The standard applies a five-step model that includes: (1) identifying the contract(s) with the customer; (2) identifying the performance obligation(s) in the contract(s); (3) determining the transaction price; (4) allocating the transaction price to the performance obligation(s) in the contract(s); and (5) recognizing revenue as the performance obligation(s) are satisfied. The standard also requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We do not include the cost of obtaining contracts within the related revenue streams since we elected the practical expedient to expense the costs to obtain a contract when incurred. We recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings. The comparative financial information has not been restated and continues to be reported under the accounting standards in effect for that period. The cumulative effect of the adjustments to our December 31, 2018 consolidated statements of income and January 1, 2018 consolidated balance sheet for the adoption of ASC Topic 606 was as follows: Income Statement Pre-ASC 606 Results Effects of Adoption of ASC 606 As Reported (In thousands) Revenues: Parts, service and collision repair $ 1,380,506 $ 381 $ 1,380,887 Finance, insurance and other, net $ 396,905 $ 8,618 $ 405,523 Cost of Sales: Parts, service and collision repair $ (713,259) $ (267) $ (713,526) Selling, general and administrative expenses: $ (1,145,294) $ (31) $ (1,145,325) Operating income (loss): $ 168,962 $ 8,701 $ 177,663 Balance Sheet December 31, 2017 Effects of Adoption of ASC 606 January 1, 2018 (In thousands) Assets: Receivables, net $ 482,126 $ 4,590 $ 486,716 Contract assets (1) $ — $ 2,082 $ 2,082 Liabilities: Other accrued liabilities $ 237,963 $ 1,286 $ 239,249 Deferred income taxes $ 51,619 $ 1,468 $ 53,087 Stockholders' Equity: Retained earnings $ 625,356 $ 3,918 $ 629,274 (1) Receivables, net in the accompanying consolidated balance sheet as of December 31, 2018 includes approximately $4.7 million related to work in process and a contract asset of approximately $5.4 million related to F&I retro revenues. Changes in contract assets from January 1, 2018 to December 31, 2018 were primarily due to ordinary business activity. Management has evaluated our established business processes, revenue transaction streams and accounting policies, and identified our material revenue streams to be: (1) the sale of new vehicles; (2) the sale of used vehicles to retail customers; (3) the sale of wholesale used vehicles at third-party auctions; (4) the arrangement of vehicle financing and the sale of service, warranty and other insurance contracts; and (5) the performance of vehicle maintenance and repair services and the sale of related parts and accessories. Generally, performance conditions are satisfied when the associated vehicle is either delivered or returned to a customer and customer acceptance has occurred, or over time as the maintenance and repair services are performed. We do not have any revenue streams with significant financing components as payments are typically received within a short period of time following completion of the performance obligation(s). Upon adoption, we changed the timing of revenue recognition related to: (1) service and collision repair orders that are incomplete as of a reporting date (“work in process”) and (2) certain retrospective finance and insurance revenue earned in periods subsequent to the completion of the initial performance obligation (“F&I retro revenues”). We previously recognized work in process when the service was completed and recognized F&I retro revenues at the amount that would be due at each reporting date based on the performance of the portfolio at such date, which results in the acceleration of revenue recognition. Under ASC 606, work in process revenues are recognized over time based on the completed work to date. Under ASC 606, F&I retro revenues are recognized when the product contract has been executed with the end customer and are estimated each reporting period based on the expected value method using historical and projected data, which results in the acceleration of revenue recognition. F&I retro revenues, which represent variable consideration, subject to constraint, are to be included in the transaction price and recognized when or as the performance obligation is satisfied. F&I retro revenues can vary based on a variety of factors, including number of contracts and history of cancellations and claims. Accordingly, we utilize this historical and projected data to constrain the consideration to the extent that it is probable that a significant reversal in the amount of cumulative revenue will not occur when the uncertainty associated with the variable consideration is subsequently resolved. We record revenue when vehicles are delivered to customers, when vehicle service work is performed and when parts are delivered. Conditions for completing a sale include having an agreement with the customer, including pricing, and the sales price must be reasonably expected to be collected. Receivables, net in the accompanying consolidated balance sheet as of December 31, 2019 include approximately $5.1 million related to work in process and a contract asset of approximately $12.9 million related to F&I retro revenues included in receivables, net on the accompanying consolidated balance sheets. We arrange financing for customers through various financial institutions and receive a commission from the financial institution either in a flat fee amount or in an amount equal to the difference between the interest rates charged to customers and the predetermined interest rates set by the financial institution. We also receive commissions from the sale of various insurance contracts and non-recourse third-party extended service contracts to customers. Under these contracts, the applicable manufacturer or third-party warranty company is directly liable for all warranties provided within the contract. We may be assessed a chargeback fee in the event of early cancellation of a loan or insurance contract by the customer. Finance and insurance commission revenue is recorded net of estimated chargebacks at the time of sale. As of December 31, 2019 and 2018, the amounts recorded as allowances for finance, insurance and service contract commission chargeback reserves were approximately $32.0 million and $25.8 million, respectively, and were classified as other accrued liabilities and other long-term liabilities in the accompanying consolidated balance sheets. |
Floor Plan Assistance | Floor Plan Assistance - We receive floor plan assistance payments from certain manufacturers. This assistance reduces the carrying value of our new vehicle inventory and is recognized as a reduction of cost of sales at the time the vehicle is sold. Amounts recognized as a reduction of cost of sales were approximately $41.5 million, $42.2 million and $45.3 million for 2019, 2018 and 2017, respectively. |
Contracts in Transit | Contracts in Transit - Contracts in transit represent customer finance contracts evidencing loans or lease agreements between us, as creditor, and the customer, as borrower, to acquire or lease a vehicle in situations where a third-party finance source has given us initial, non-binding approval to assume our position as creditor. Funding and final approval from the finance source is provided upon the finance source’s review of the loan or lease agreement and related documentation executed by the customer at the dealership. These finance contracts are typically funded within 10 days of the initial approval of the finance transaction given by the third-party finance source. The finance source is not contractually obligated to make the loan or lease to the customer until it gives its final approval and funds the transaction, and until such final approval is given, the contracts in transit represent amounts due from the customer to us. Contracts in transit are included in receivables, net on the accompanying consolidated balance sheets and totaled approximately $230.9 million and $227.8 million at December 31, 2019 and 2018, respectively. |
Accounts Receivable | Accounts Receivable - In addition to contracts in transit, our accounts receivable primarily consists of amounts due from automobile manufacturers for repair services performed on vehicles with a remaining factory warranty and amounts due from third parties from the sale of parts. We evaluate receivables for collectability based on the age of the receivable, the credit history of the customer and past collection experience. The recorded allowance for doubtful accounts receivable was not significant at December 31, 2019 and 2018. |
Inventories | Inventories - Inventories of new vehicles, recorded net of manufacturer credits, and used vehicles, including demonstrators, are stated at the lower of specific cost or net realizable value. Inventories of parts and accessories are accounted for using the “first-in, first-out” (“FIFO”) method of inventory accounting and are stated at the lower of FIFO cost or net realizable value. Other inventories are primarily service loaner vehicles and, to a lesser extent, vehicle chassis, other supplies and capitalized customer work-in-progress (open customer vehicle repair orders). Other inventories are stated at the lower of specific cost (depreciated cost for service loaner vehicles) or net realizable value. |
Property and Equipment | Property and Equipment - Property and equipment are stated at cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets. We amortize leasehold improvements over the shorter of the estimated useful life or the remaining available lease term. The available lease term includes renewal options if the exercise of a renewal option has been determined to be reasonably assured. The range of estimated useful lives is as follows: Leasehold, buildings and land improvements 10-30 years Furniture, fixtures and equipment 3-10 years We review the carrying value of property and equipment and other long-term assets (including related right-of-use assets for leased properties, but excluding goodwill and franchise assets) for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If such an indication is present, we compare the carrying amount of the asset to the estimated undiscounted cash flows related to that asset. We conclude that an asset is impaired if the sum of such expected future cash flows is less than the carrying amount of the related asset. If we determine an asset is impaired, the impairment loss would be the amount by which the carrying amount of the related asset exceeds its fair value. The fair value of the asset would be determined based on the quoted market prices, if available. If quoted market prices are not available, we determine fair value by using a discounted cash flow model. See Note 4, “Property and Equipment,” for a discussion of impairment charges. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities - We utilize derivative financial instruments for the purpose of hedging the risks of certain identifiable and anticipated transactions. Commonly, the types of risks being hedged are those relating to the variability of cash flows caused by fluctuations in interest rates. We document our risk management strategy and hedge effectiveness at the inception of and during the term of each hedge. As of December 31, 2019, we utilized interest rate cap agreements to limit our exposure to increases in London InterBank Offered Rate (“LIBOR”) rates above certain levels. See Note 6, “Long-Term Debt,” for further discussion of derivative instruments and hedging activities. |
Goodwill | Goodwill - Goodwill is recognized to the extent that the purchase price of the acquisition exceeds the estimated fair value of the net assets acquired, including other identifiable intangible assets. In accordance with “Intangibles - Goodwill and Other” in the ASC, we test goodwill for impairment at least annually (as of October 1 of each year), or more frequently if indications of impairment exist. The ASC also states that if an entity determines, based on an assessment of certain qualitative factors, that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative goodwill impairment test is unnecessary. For purposes of goodwill impairment testing, we have two reporting units, which consist of: (1) our traditional franchised dealerships and (2) our EchoPark stores. The carrying value of our goodwill totaled approximately $475.8 million at December 31, 2019, $415.8 million of which was related to our franchised dealerships reporting unit and $60.0 million of which was related to our EchoPark reporting unit. For each reporting unit, we utilized the Discounted Cash Flows (“DCF”) method to estimate its enterprise value as of October 1, 2019. The significant assumptions in our DCF model include projected earnings, a discount rate (and estimates in the discount rate inputs) and residual growth rates. In evaluating goodwill for impairment, if the fair value of a reporting unit is less than its carrying value, the difference would represent the amount of required goodwill impairment. To the extent the reporting unit’s earnings decline significantly or there are changes in one or more of these assumptions that would result in lower valuation results, it could cause the carrying value of the reporting unit to exceed its fair value and thus require us to record goodwill impairment. Based on the results of our quantitative test as of October 1, 2019, each reporting unit’s fair value exceeded its carrying value. As a result, we were not required to record goodwill impairment for either of our reporting units. See Note 5, “Intangible Assets and Goodwill,” for further discussion of goodwill. |
Other Intangible Assets | Other Intangible Assets - The principal identifiable intangible assets other than goodwill acquired in an acquisition are rights under franchise or dealer agreements with manufacturers. We classify franchise and dealer agreements as indefinite lived intangible assets as it has been our experience that renewals have occurred without substantial cost or material modifications to the underlying agreements. As such, we believe that our franchise and dealer agreements will contribute to cash flows for an indefinite period, therefore the carrying amount of franchise rights is not amortized. Franchise and dealer agreements acquired on or after July 1, 2001 have been included in other intangible assets, net on the accompanying consolidated balance sheets. Prior to July 1, 2001, franchise and dealer agreements were recorded and amortized as part of goodwill and remain as part of goodwill on the accompanying consolidated balance sheets. In accordance with “Intangibles - Goodwill and Other” in the ASC, we evaluate other intangible assets for impairment annually (as of October 1 each year) or more frequently if indications of impairment exist. We utilized a DCF model to estimate the fair value of the franchise assets for each of our franchises with recorded franchise assets. The significant assumptions in our DCF model include projected revenue, projected operating margin, a discount rate (and estimates in the discount rate inputs) and residual growth rates. In projecting the franchises’ revenue and growth rates, we developed many assumptions which may include, but are not limited to, revenue growth, internal revenue enhancement initiatives, cost control initiatives, internal investment programs (such as training, technology and infrastructure) and inventory floor plan borrowing rates. Our expectation of revenue growth is in part driven by our estimates of new vehicle industry sales volume in future periods. We believe the historic and projected industry sales volume is a good general indicator of growth or contraction in the retail automotive industry. Based on the October 1, 2019 impairment test, we determined that the fair value of the franchise assets exceeded the carrying value of the franchise assets for all of our franchises, resulting in no franchise asset impairment charges during 2019. See Note 5, “Intangible Assets and Goodwill,” for further discussion of franchise and dealer agreements. |
Insurance Reserves | Insurance Reserves - We have various self-insured and high deductible casualty and other insurance programs which require the Company to make estimates in determining the ultimate liability it may incur for claims arising under these programs. These insurance reserves are estimated by management using actuarial evaluations based on historical claims experience, claims processing procedures, medical cost trends and, in certain cases, a discount factor. As of December 31, 2019 and 2018, we had approximately $23.1 million and $22.9 million, respectively, reserved for such programs. |
Income Taxes | Income Taxes - Income taxes are provided for the tax effects of transactions reported in the accompanying consolidated financial statements and consist of taxes currently due plus deferred taxes. Deferred taxes are provided at enacted tax rates for the tax effects of carryforward items and temporary differences between the tax basis of assets and liabilities and their reported amounts. As a matter of course, the Company is regularly audited by various taxing authorities and, from time to time, these audits result in proposed assessments where the ultimate resolution may result in the Company owing additional taxes. Management believes that the Company’s tax positions comply, in all material respects, with applicable tax law and that the Company has adequately provided for any reasonably foreseeable outcome related to these matters. |
Concentrations of Credit and Business Risk | Concentrations of Credit and Business Risk - Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash on deposit with financial institutions. At times, amounts invested with financial institutions exceed Federal Deposit Insurance Corporation insurance limits. Concentrations of credit risk with respect to receivables are limited primarily to receivables from automobile manufacturers, totaling approximately $94.8 million and $93.8 million at December 31, 2019 and 2018, respectively, and receivables from financial institutions (which include manufacturer-affiliated finance companies and commercial banks), totaling approximately $258.7 million at December 31, 2019 and 2018. Credit risk arising from trade receivables from commercial customers is reduced by the large number of customers comprising the trade receivables balances. We are subject to a concentration of risk in the event of financial distress or other adverse events related to any of the automobile manufacturers whose franchised dealerships are included in our brand portfolio. We purchase our new vehicle inventory from various automobile manufacturers at the prevailing prices available to all franchised dealerships. In addition, we finance a substantial portion of our new vehicle inventory with manufacturer-affiliated finance companies. Our results of operations could be adversely affected by the manufacturers’ inability to supply our dealerships with an adequate supply of new vehicle inventory and related floor plan financing. We also have concentrations of risk related to the geographic markets in which our dealerships operate. Changes in overall economic, retail automotive or regulatory environments in one or more of these markets could adversely impact the results of our operations. |
Financial Instruments and Market Risks | Financial Instruments and Market Risks - As of December 31, 2019 and 2018, the fair values of our financial instruments including receivables, notes receivable from finance contracts, notes payable - floor plan, trade accounts payable, borrowings under the revolving credit facilities and certain mortgage notes approximated their carrying values due either to length of maturity or existence of variable interest rates that approximate prevailing market rates. See Note 11, “Fair Value Measurements,” for further discussion of the fair value and carrying value of our fixed rate long-term debt and other financial instruments. We have variable rate notes payable - floor plan, revolving credit facilities, a mortgage facility and other variable rate notes that expose us to risks caused by fluctuations in the underlying interest rates. The counterparties to our interest rate cap agreements are large financial institutions, however, we could be exposed to loss in the event of non-performance by any of these counterparties. See further discussion in Note 6, “Long-Term Debt.” |
Advertising | Advertising - We expense advertising costs in the period incurred, net of earned cooperative manufacturer credits that represent reimbursements for specific, identifiable and incremental advertising costs. Advertising expense amounted to approximately $60.8 million, $63.1 million and $61.6 million for 2019, 2018 and 2017, respectively, and is classified in selling, general and administrative expenses in the accompanying consolidated statements of income. We have cooperative advertising reimbursement agreements with certain automobile manufacturers we represent. These agreements require us to provide the manufacturer with support for qualified, actual advertising expenditures in order to receive reimbursement under the agreements. It is uncertain whether or not we would maintain the same level of advertising expenditures if these manufacturers discontinued their cooperative programs. Cooperative manufacturer credits classified as an offset to advertising expenses were approximately $25.3 million, $26.7 million and $26.0 million for 2019, 2018 and 2017, respectively. |
Segment Information | Segment Information - We have determined we have two reportable segments: (1) the Franchised Dealerships Segment and (2) the EchoPark Segment, for purposes of reporting financial condition and results of operations. The Franchised Dealerships Segment is comprised of retail automotive franchises that sell new vehicles and buy and sell used vehicles, sell replacement parts, perform vehicle repair and maintenance services, and arrange finance and insurance products. The EchoPark Segment is comprised of pre-owned vehicle specialty retail locations that provide customers an opportunity to search our nationwide inventory, purchase a pre-owned vehicle, select finance and insurance products and sell their current vehicle to us. Earnings Per Share - The calculation of diluted earnings per share considers the potential dilutive effect of restricted stock units, restricted stock awards and stock options granted under Sonic’s stock compensation plans (and any non-forfeitable dividends paid on such awards). |
Description of Business and S_2
Description of Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Range of Estimated Useful Lives | The range of estimated useful lives is as follows: Leasehold, buildings and land improvements 10-30 years Furniture, fixtures and equipment 3-10 years |
Business Acquisitions and Dis_2
Business Acquisitions and Dispositions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Revenues and Other Activities Associated with Disposed Dealerships Classified as Discontinued Operations | Income (loss) from operations and lease exit accrual adjustments and charges associated with disposed dealerships classified as discontinued operations were as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Income (loss) from operations before taxes $ (554) $ (610) $ (735) Lease exit accrual adjustments and charges — (407) (1,207) Income (loss) from discontinued operations before taxes $ (554) $ (1,017) $ (1,942) |
Revenues and Other Activities Associated with Disposed Dealerships That Remain in Continuing Operations | Revenues and other operating results associated with disposed dealerships that remain in continuing operations were as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Income (loss) from operations before taxes and items below $ 3,154 $ (4,313) $ (736) Gain (loss) on disposal of dealerships (1) 76,461 39,307 9,974 Lease exit accrual adjustments and charges 170 210 (1,207) Impairment charges — (4,180) (318) Income (loss) before taxes $ 79,785 $ 31,024 $ 7,713 Total revenues $ 307,849 $ 783,275 $ 1,140,514 |
Inventories and Related Notes_2
Inventories and Related Notes Payable - Floor Plan (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | Inventories consist of the following: December 31, 2019 December 31, 2018 (In thousands) New vehicles $ 983,123 $ 1,027,727 Used vehicles 319,791 293,179 Service loaners 152,278 141,542 Parts, accessories and other 62,683 66,013 Net inventories $ 1,517,875 $ 1,528,461 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Components of Property and Equipment, Net | Property and equipment, net consists of the following: December 31, 2019 December 31, 2018 (In thousands) Land $ 373,301 $ 381,527 Building and improvements (1) 969,609 989,872 Furniture, fixtures and equipment 346,260 330,149 Construction in progress 50,928 59,523 Total, at cost 1,740,098 1,761,071 Less accumulated depreciation (616,611) (575,720) Subtotal 1,123,487 1,185,351 Less assets held for sale (2) (26,240) (6,862) Property and equipment, net $ 1,097,247 $ 1,178,489 (1) As discussed in Note 1, “Description of Business and Summary of Significant Accounting Policies,” due to the adoption of ASC 842, “Leases,” effective January 1, 2019, previously existing capital lease assets have been reclassified from property and equipment, net to financing - right-of- use assets in the accompanying consolidated balance sheet as of December 31, 2019. (2) Classified in other current assets in the accompanying consolidated balance sheets. |
Property and Equipment Impairment Charges | During 2019, 2018 and 2017, property and equipment impairment charges were recorded as noted in the following table: Franchised Dealerships Segment EchoPark Segment Consolidated Year Ended December 31, (In thousands) 2019 $ 1,101 $ 19,667 $ 20,768 2018 $ 25,832 $ 1,582 $ 27,414 2017 $ 3,890 $ 1,004 $ 4,894 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Franchise Assets and Goodwill | The changes in the carrying amount of franchise assets and goodwill for 2019 and 2018 were as follows: Franchise Assets Net Goodwill (In thousands) Balance at December 31, 2017 $ 69,900 $ 525,780 (1) Reductions from dispositions (2,100) (16,188) Reductions from impairment (2,100) — Balance at December 31, 2018 $ 65,700 $ 509,592 (1) Reductions from dispositions (1,400) (33,801) Balance at December 31, 2019 $ 64,300 $ 475,791 (1) (1) Net of accumulated impairment losses of $797.6 million. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-term debt consists of the following: December 31, 2019 December 31, 2018 (In thousands) 2016 Revolving Credit Facility (1) $ — $ — 5.0% Senior Subordinated Notes due 2023 (the “5.0% Notes”) — 289,273 6.125% Senior Subordinated Notes due 2027 (the “6.125% Notes”) 250,000 250,000 2019 Mortgage Facility (2) 109,088 — Mortgage notes to finance companies - fixed rate, bearing interest from 3.51% to 7.03% 194,535 215,196 Mortgage notes to finance companies - variable rate, bearing interest at 1.50 to 2.90 percentage points above one-month or three-month LIBOR 161,345 180,959 Other — 20,589 Subtotal 714,968 956,017 Debt issuance costs (8,082) (10,934) Total debt 706,886 945,083 Less current maturities (69,908) (26,304) Long-term debt $ 636,978 $ 918,779 (1) The interest rate on the 2016 Revolving Credit Facility (as defined below) was 150 and 250 basis points above LIBOR at December 31, 2019 and 2018, respectively. (2) The interest rate on the 2019 Mortgage Facility (as defined below) was 200 basis points above LIBOR at December 31, 2019. |
Future Maturities of Long-Term Debt | Future maturities of long-term debt are as follows: Principal Year Ending December 31, (In thousands) 2020 $ 69,908 2021 63,274 2022 50,241 2023 68,857 2024 108,462 Thereafter 354,226 Total $ 714,968 |
Debt Instrument [Line Items] | |
Financial Covenants Include Required Specified Ratios | We were in compliance with the financial covenants under the 2016 Credit Facilities and the 2019 Mortgage Facility as of December 31, 2019. Financial covenants include required specified ratios (as each is defined in the 2016 Credit Facilities and the 2019 Mortgage Facility) of: Covenant Minimum Consolidated Liquidity Ratio Minimum Consolidated Fixed Charge Coverage Ratio Maximum Consolidated Total Lease Adjusted Leverage Ratio Required ratio 1.05 1.20 5.75 December 31, 2019 actual 1.11 1.60 3.21 |
Summary of Interest Received and Paid under Term of Cash Flow Swap | . Notional Cap Rate (1) Receive Rate (1) (2) Start Date Maturing Date (In millions) $ 312.5 2.000% one-month LIBOR July 1, 2019 June 30, 2020 $ 250.0 3.000% one-month LIBOR July 1, 2019 June 30, 2020 $ 225.0 3.000% one-month LIBOR July 1, 2020 June 30, 2021 $ 150.0 2.000% one-month LIBOR July 1, 2020 July 1, 2021 $ 250.0 3.000% one-month LIBOR July 1, 2021 July 1, 2022 (1) Under these interest rate caps, no payment will occur unless the stated receive rate exceeds the stated pay rate. If this occurs, a net payment to us from the counterparty based on the spread between the receive rate and the pay rate will be recognized as a reduction of interest expense, other, net in the accompanying consolidated statements of income. (2) The one-month LIBOR rate was approximately 1.763% at December 31, 2019. |
6.125% Notes | |
Debt Instrument [Line Items] | |
Redemption Price, Percentage | We may redeem the 6.125% Notes, in whole or in part, at any time on or after March 15, 2022 at the following redemption prices, which are expressed as percentages of the principal amount: Redemption Price Beginning on March 15, 2022 103.063 % Beginning on March 15, 2023 102.042 % Beginning on March 15, 2024 101.021 % Beginning on March 15, 2025 and thereafter 100.000 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes for Continuing Operations - Benefit (Expense) | The provision for income taxes for continuing operations - benefit (expense) consists of the following: Year Ended December 31, 2019 2018 2017 (In thousands) Current: Federal $ (62,016) $ (37,028) $ (34,877) State (12,563) (7,411) (7,292) Total current (74,579) (44,439) (42,169) Deferred 19,471 21,517 28,198 Total provision for income taxes for continuing operations - benefit (expense) $ (55,108) $ (22,922) $ (13,971) |
Reconciliation of Statutory Federal Income Tax Rate with Federal and State Overall Effective Income Tax Rate from Continuing Operations | The reconciliation of the U.S. statutory federal income tax rate with our federal and state overall effective income tax rate from continuing operations is as follows: Year Ended December 31, 2019 2018 2017 U.S. statutory federal income tax rate 21.00 % 21.00 % 35.00 % Effective state income tax rate 4.10 % 4.60 % 4.58 % Valuation allowance adjustments (0.18) % 0.20 % (0.59) % Uncertain tax positions (0.45) % 0.17 % 0.71 % Effect of change in future U.S. statutory federal income tax rate 0.00 % 0.00 % (26.27) % Non-deductible compensation 1.48 % 3.06 % 0.23 % Other 1.65 % 1.41 % (0.74) % Effective income tax rate 27.60 % 30.44 % 12.92 % |
Components of Deferred Tax Assets and Liabilities | Significant components of our deferred tax assets and liabilities are as follows: December 31, 2019 December 31, 2018 (In thousands) Deferred tax assets: Accruals and reserves $ 27,271 $ 24,948 State net operating loss carryforwards 10,771 12,687 Basis difference in property and equipment 20,923 11,515 Interest and state taxes associated with the liability for uncertain income tax positions 938 1,175 Fair value of interest rate swaps and interest rate caps 1,153 — Basis difference in liabilities related to right-of-use assets 93,808 — Other 2,146 1,778 Total deferred tax assets 157,010 52,103 Deferred tax liabilities: Fair value of interest rate swaps and caps — (462) Basis difference in inventories (804) (838) Basis difference in goodwill (61,397) (69,646) Basis difference in right-of-use assets (90,679) — Other (2,316) (2,544) Total deferred tax liabilities (155,196) (73,490) Valuation allowance (7,775) (8,138) Net deferred tax asset (liability) $ (5,961) $ (29,525) |
Summary of Changes in Liability Related to Unrecognized Tax Benefits | A summary of the changes in the liability related to our unrecognized tax benefits is presented below. 2019 2018 2017 (In thousands) Unrecognized tax benefit liability, January 1 (1) $ 4,901 $ 4,645 $ 4,357 New positions — — 653 Prior period positions: Increases 1,795 7 491 Decreases (2,697) (199) (539) Increases from current period positions 582 714 692 Settlements (653) — — Lapse of statute of limitations (8) (69) (781) Other (81) (197) (228) Unrecognized tax benefit liability, December 31 (2) $ 3,839 $ 4,901 $ 4,645 (1) Excludes accrued interest and penalties of $0.6 million, $0.6 million and $0.8 million at January 1, 2019, 2018 and 2017, respectively. (2) Excludes accrued interest and penalties of $0.5 million, $0.6 million and $0.6 million at December 31, 2019, 2018 and 2017, respectively. Amount presented is net of state net operating losses of $0.0 million, $0.0 million and $0.1 million at December 31, 2019, 2018 and 2017, respectively. |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Status of Stock Options Related to Stock Plans | A summary of the status of the stock options related to the Stock Plans is presented below: Options Outstanding Exercise Price Per Share (Low - High) Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (In thousands, except per share data, term in years) Balance at December 31, 2018 33 $ 1.81 - 1.81 $ 1.81 0.3 $ 392 Exercised (33) $ 1.81 - 1.81 $ 1.81 |
Schedule Intrinsic Value of Options Exercised | Year Ended December 31, 2019 2018 2017 (In thousands) Intrinsic value of stock options exercised $ 426 $ 3,564 $ 425 |
Status of Non-Vested Restricted Stock and Restricted Stock Unit Grants Related to Stock Plans | A summary of the status of the non-vested restricted stock award and restricted stock unit grants related to the Stock Plans is presented below: Non-Vested Restricted Stock Awards and Restricted Stock Units Weighted Average Grant Date Fair Value per Share (In thousands, except per share data) Balance at December 31, 2018 2,161 $ 21.20 Granted 968 $ 13.38 Forfeited (295) $ 19.75 Vested (487) $ 18.82 Balance at December 31, 2019 2,347 $ 19.34 |
Status of Supplemental Executive Retirement Plan | The following table sets forth the status of the SERP: Year Ended December 31, 2019 2018 Change in projected benefit obligation: (In thousands) Obligation at January 1 $ 13,326 $ 13,556 Service cost 1,731 1,933 Interest cost 575 470 Actuarial loss (gain) 2,641 (2,368) Amendments/settlements/curtailments loss (gain) — — Benefits paid (265) (265) Obligation at December 31 (1) $ 18,008 $ 13,326 Accumulated benefit obligation $ 13,694 $ 10,191 (1) For 2019, approximately $0.4 million is included in other accrued liabilities and approximately $17.6 million is included in other long-term liabilities in the accompanying consolidated balance sheets. For 2018, approximately $0.3 million is included in other accrued liabilities and approximately $13.0 million is included in other long-term liabilities in the accompanying consolidated balance sheets. |
Schedule of Funded Status | Year Ended December 31, 2019 2018 (In thousands) Change in fair value of plan assets: Plan assets at January 1 $ — $ — Actual return on plan assets — — Employer contributions 265 265 Benefits paid (265) (265) Plan assets at December 31 — — Funded status recognized $ (18,008) $ (13,326) |
Cost Components of Supplemental Executive Retirement Plan | The following table provides the cost components of the SERP: Year Ended December 31, 2019 2018 (In thousands) Service cost $ 1,731 $ 1,933 Interest cost 575 470 Net pension expense (benefit) $ 2,306 $ 2,403 |
Weighted Average Assumptions Used to Determine Benefit Obligation and Net Periodic Benefit Costs | The weighted average assumptions used to determine the benefit obligation and net periodic benefit costs consist of: As of December 31, 2019 2018 Discount rate 2.99 % 4.36 % Rate of compensation increase 3.00 % 3.00 % |
Estimated Future Benefit Payments | The estimated future benefit payments expected to be paid for each of the next five years and the sum of the payments expected for the next five years thereafter are: Estimated Future Benefit Payments Year Ending December 31, (In thousands) 2020 $ 360 2021 $ 360 2022 $ 360 2023 $ 360 2024 $ 360 2025 - 2029 $ 2,414 |
Schedule of Multiemployer Pension Plans Affecting Period-to-Period Comparability of Contributions | Our participation in the AI Pension Plan for 2019, 2018 and 2017 is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employee Identification Number (the “EIN”). Unless otherwise noted, the most recent Pension Protection Act of 2006 (the “PPA”) zone status available in the years ended December 31, 2019 and 2018 is for the plan’s year-end at December 31, 2018 and 2017, respectively. The zone status is based on information that we received from the AI Pension Plan. Among other factors, plans in the red zone are generally less than 65% funded (“Critical Status”), plans in the yellow zone are less than 80% funded and plans in the green zone are at least 80% funded. The “FIP/RP Status - Pending/Implemented” column indicates plans for which a Financial Improvement Plan (“FIP”) or a Rehabilitation Plan (“RP”) is either pending or has been implemented. The last column lists the expiration dates of the collective bargaining agreements to which the plan is subject. The number of employees covered by the AI Pension Plan decreased 1.0% from December 31, 2017 to December 31, 2018 and decreased 5.5% from December 31, 2018 to December 31, 2019, affecting the period-to-period comparability of the contributions for 2019, 2018 and 2017. Pension Protection Act Zone Status FIP/RP Status Sonic Contributions Surcharge Imposed Collective Bargaining Agreement Expiration Date Pension Fund EIN/Pension Plan Number 2019 2018 Pending /Implemented Year Ended December 31, 2019 2018 2017 (In thousands) AI Pension Plan 94-1133245 Red Red RP Implemented $181 $176 $171 Yes Between |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Recorded at Fair Value | Assets and liabilities recorded at fair value in the accompanying consolidated balance sheets as of December 31, 2019 and 2018 are as follows: Fair Value Based on Significant Other Observable Inputs (Level 2) December 31, 2019 December 31, 2018 (In thousands) Assets: Cash surrender value of life insurance policies (1) $ 32,799 $ 31,395 Cash flow swaps and interest rate caps designated as hedges (2) 97 4,839 Total assets $ 32,896 $ 36,234 Liabilities: Deferred compensation plan (3) $ 17,890 $ 19,848 Total liabilities $ 17,890 $ 19,848 (1) Included in other assets in the accompanying consolidated balance sheets. (2) As of December 31, 2019, approximately $0.1 million was included in other assets in the accompanying consolidated balance sheets. As of December 31, 2018, approximately $1.8 million and $3.0 million were included in other current assets and other assets, respectively, in the accompanying consolidated balance sheets. (3) Included in other long-term liabilities in the accompanying consolidated balance sheets. |
Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis | The carrying value of assets and liabilities measured at fair value on a non-recurring basis but not completely adjusted to fair value in the accompanying consolidated balance sheet as of December 31, 2019, are included in the table below. Certain components of long-lived assets held and used have been adjusted to fair value through impairment charges as discussed in Note 4, “Property and Equipment,” and Note 5, “Intangible Assets and Goodwill.” Significant Total Gains / (In thousands) Long-lived assets held and used (1) $ 7,286 $ (1,345) Assets held for sale (1) $ 23,030 $ (17,741) (1) See Note 1, “Description of Business and Summary of Significant Accounting Policies,” and Note 4, “Property and Equipment.” The fair values less costs to sell of long-lived assets or disposal groups held for sale are assessed each reporting period they remain classified as held for sale. Subsequent changes in the held for sale long-lived asset’s or disposal group’s fair value less cost to sell (increase or decrease) are reported as an adjustment to its carrying amount, except that the adjusted carrying amount cannot exceed the carrying amount of the long-lived asset or disposal group at the time it was initially classified as held for sale. (2) Excludes impairment loss of approximately $1.7 million related to long lived assets that were disposed during the year ended December 31, 2019. |
Fair Value and Carrying Value of Fixed Rate Long-Term Debt | The fair value and carrying value of our fixed rate long-term debt were as follows: December 31, 2019 December 31, 2018 Fair Value Carrying Value Fair Value Carrying Value (In thousands) 5.0% Notes (1) $ — $ — $ 262,515 $ 289,273 6.125% Notes (1) $ 261,250 $ 250,000 $ 216,250 $ 250,000 Mortgage Notes (2) $ 195,962 $ 194,535 $ 218,402 $ 215,196 Other (2) $ — $ — $ 20,437 $ 20,588 (1) As determined by market quotations as of December 31, 2019 and 2018, respectively (Level 1). (2) As determined by DCF (Level 3). |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Lease Exit Accruals | (In thousands) Balance at December 31, 2018 $ 4,634 Effect of adoption of ASC 842, “Leases” (4,634) Balance at December 31, 2019 $ — |
Financial Covenants Related to Amended Subordination and Guaranty Agreement | Many of our facility operating leases are subject to affirmative and financial covenant provisions related to a subordination and guaranty agreement executed with the landlord of many of our facility properties. The required financial covenants related to certain lease agreements are as follows: Covenant Minimum Consolidated Liquidity Ratio Minimum Consolidated Fixed Charge Coverage Ratio Maximum Consolidated Total Lease Adjusted Leverage Ratio Minimum EBTDAR to Rent Ratio Required ratio 1.05 1.20 5.75 1.50 December 31, 2019 actual 1.11 1.60 3.21 5.57 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Summary of Changes in Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive income (loss) by component for 2019 are as follows: Gains and (Losses) on Cash Flow Hedges Defined Benefit Pension Plan Total Accumulated Other Comprehensive Income (Loss) (In thousands) Balance at December 31, 2018 $ 3,034 $ 1,199 $ 4,233 Other comprehensive income (loss) before reclassifications (1) (1,646) (1,935) (3,581) Amounts reclassified out of accumulated other comprehensive income (loss) (2) (2,714) — (2,714) Net current-period other comprehensive income (loss) (4,360) (1,935) (6,295) Balance at December 31, 2019 $ (1,326) $ (736) $ (2,062) (1) Net of tax benefit of $836 related to gains on cash flow hedges and tax benefit of $734 related to the defined benefit pension plan. (2) Net of tax benefit of $1,108 related to gains on cash flow hedges. |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)retail_Units | Dec. 31, 2018USD ($)retail_Units | Dec. 31, 2017USD ($)retail_Units | |
Segment Reporting Information [Line Items] | |||||||||||
Total capital expenditures | $ 125,576,000 | $ 163,619,000 | $ 234,245,000 | ||||||||
Legal Costs | 1,700,000 | ||||||||||
EchoPark Capital Expenditures | 36,244,000 | 46,765,000 | 39,025,000 | ||||||||
Franchised Dealerships Capital Expenditures | 89,332,000 | 116,854,000 | 195,220,000 | ||||||||
EchoPark Interest Expense, Other, Net | 1,722,000 | 1,663,000 | 976,000 | ||||||||
Franchised Segment Interest Expense, Other, Net | 51,231,000 | 52,396,000 | 51,548,000 | ||||||||
Franchised Dealerships Segment Impairment | 1,100,000 | ||||||||||
EchoPark Lease exit expense | 600,000 | ||||||||||
Lease exit expense | (4,634,000) | 1,400,000 | 300,000 | ||||||||
Gain on Franchise Disposal | 76,000,000 | 38,900,000 | 10,000,000 | ||||||||
Double Carry Interest | (500,000) | 700,000 | |||||||||
Debt Extinguishment Costs | 7,200,000 | 14,600,000 | |||||||||
Executive transition costs | $ 1,600,000 | 6,300,000 | 1,600,000 | 1,300,000 | |||||||
Total Storm Damage Charges | 8,900,000 | ||||||||||
EchoPark Storm Damage Charges | 200,000 | ||||||||||
Franchised Dealerships Storm Damage Charges | 4,000,000 | ||||||||||
EchoPark Segment Assets | $ 244,054,000 | $ 305,673,000 | 244,054,000 | 305,673,000 | |||||||
Franchised Dealerships Segment Assets | 3,797,878,000 | 3,485,280,000 | 3,797,878,000 | 3,485,280,000 | |||||||
EchoPark Depreciation and Amortization | 10,533,000 | 7,774,000 | 5,203,000 | ||||||||
Franchised Dealerships Depreciation and Amortization | $ 82,636,000 | 85,849,000 | 83,741,000 | ||||||||
Summary of Reportable Operating Segment | Reportable segment revenues, segment income (loss), impairment charges, depreciation and amortization, floor plan interest expense, interest expense, other, net, capital expenditures and assets are as follows: Year Ended December 31, 2019 2018 2017 Segment revenues (In thousands) Franchised Dealerships Segment revenues: New vehicles $ 4,889,171 $ 4,974,097 $ 5,295,051 Used vehicles 2,493,467 2,370,799 2,406,407 Wholesale vehicles 180,020 197,184 161,581 Parts, service and collision repair 1,366,550 1,364,559 1,401,802 Finance, insurance and other, net 363,117 344,814 348,058 Franchised Dealerships Segment revenues $ 9,292,325 $ 9,251,453 $ 9,612,899 EchoPark Segment revenues: Used vehicles $ 996,504 $ 602,698 $ 215,646 Wholesale vehicles 22,927 20,443 9,483 Parts, service and collision repair 28,753 16,327 14,208 Finance, insurance and other, net 113,834 60,709 14,972 EchoPark Segment revenues $ 1,162,018 $ 700,177 $ 254,309 Total consolidated revenues $ 10,454,343 $ 9,951,630 $ 9,867,208 Year Ended December 31, 2019 2018 2017 Segment income (loss) (1) (In thousands) Franchised Dealerships Segment (2) $ 211,267 $ 157,413 $ 138,468 EchoPark Segment (3) 9,146 (52,587) (20,950) Total segment income (loss) $ 220,413 $ 104,826 $ 117,518 Impairment charges (4) (20,768) (29,514) (9,394) Income (loss) from continuing operations before taxes $ 199,645 $ 75,312 $ 108,124 Retail new and used vehicle unit sales volume: Franchised Dealerships Segment 226,760 232,885 248,534 EchoPark Segment 49,520 29,437 10,618 Total retail new and used vehicle unit sales volume 276,280 262,322 259,152 (1) Segment income (loss) for each segment is defined as income (loss) from continuing operations before taxes and impairment charges. (2) For the year ended December 31, 2019, the above amount includes approximately $76.0 million of net gain on the disposal of franchised dealerships, offset partially by approximately $7.2 million of loss on the extinguishment of debt, approximately $6.3 million of executive transition costs and approximately $1.1 million of impairment charges. For the year ended December 31, 2018, the above amount includes approximately $38.9 million of net gain on the disposal of franchised dealerships, offset partially by approximately $27.9 million of impairment charges, approximately $4.0 million of storm-related physical damage costs, approximately $1.7 million of legal costs, approximately $1.6 million of executive transition costs and approximately $1.4 million of lease exit charges. For the year ended December 31, 2017, the above amount includes approximately $14.6 million of net loss on the extinguishment of debt, approximately $8.9 million of storm-related physical damage and legal costs, approximately $7.5 million of impairment charges, approximately $0.7 million of double-carry interest and approximately $0.3 million of lease exit charges, offset partially by approximately $10.0 million of net gain on the disposal of franchised dealerships. (3) For the year ended December 31, 2019, the above amount includes approximately $19.7 million of impairment charges related to building and land held for sale at former EchoPark locations. For the year ended December 31, 2018, the above amount includes approximately $32.5 million of long-term compensation-related charges and approximately $1.6 million of impairment charges. For the year ended December 31, 2017, the above amount includes approximately $1.9 million of impairment charges, approximately $1.3 million of long-term compensation-related charges, approximately $0.6 million of lease exit charges and approximately $0.2 million of storm-related physical damage and legal costs. (4) For the year ended December 31, 2019, the above amount includes approximately $1.1 million of impairment charges for the Franchised Dealerships Segment and approximately $19.7 million of impairment charges for the EchoPark Segment. For the year ended December 31, 2018, the above amount includes approximately $27.9 million of impairment charges for the Franchised Dealerships Segment and approximately $1.6 million of impairment charges for the EchoPark Segment. For the year ended December 31, 2017, the above amount includes approximately $7.5 million of impairment charges for the Franchised Dealerships Segment and approximately $1.9 million of impairment charges for the EchoPark Segment. Year Ended December 31, 2019 2018 2017 (In thousands) Impairment charges: Franchised Dealerships Segment $ 1,101 $ 27,932 $ 7,491 EchoPark Segment 19,667 1,582 1,903 Total impairment charges $ 20,768 $ 29,514 $ 9,394 Year Ended December 31, 2019 2018 2017 (In thousands) Depreciation and amortization: Franchised Dealerships Segment $ 82,636 $ 85,849 $ 83,741 EchoPark Segment 10,533 7,774 5,203 Total depreciation and amortization $ 93,169 $ 93,623 $ 88,944 Year Ended December 31, 2019 2018 2017 (In thousands) Floor plan interest expense: Franchised Dealerships Segment $ 45,055 $ 46,126 $ 35,030 EchoPark Segment 3,464 2,272 1,365 Total floor plan interest expense $ 48,519 $ 48,398 $ 36,395 Year Ended December 31, 2019 2018 2017 (In thousands) Interest expense, other, net: Franchised Dealerships Segment $ 51,231 $ 52,396 $ 51,548 EchoPark Segment 1,722 1,663 976 Total interest expense, other, net $ 52,953 $ 54,059 $ 52,524 Year Ended December 31, 2019 2018 2017 (In thousands) Capital expenditures: Franchised Dealerships Segment $ 89,332 $ 116,854 $ 195,220 EchoPark Segment 36,244 46,765 39,025 Total capital expenditures $ 125,576 $ 163,619 $ 234,245 December 31, 2019 2018 (In thousands) Assets: Franchised Dealerships Segment $ 3,797,878 $ 3,485,280 EchoPark Segment 244,054 305,673 Corporate and other: Cash and cash equivalents 29,103 5,854 Total assets $ 4,071,035 $ 3,796,807 | ||||||||||
EchoPark Floorplan Exp | $ 3,464,000 | 2,272,000 | 1,365,000 | ||||||||
Franchised Dealerships Floorplan Exp | $ 45,055,000 | $ 46,126,000 | $ 35,030,000 | ||||||||
Segment Retail Units | retail_Units | 276,280 | 262,322 | 259,152 | ||||||||
EchoPark Retail Units | retail_Units | 49,520 | 29,437 | 10,618 | ||||||||
Franchised Dealerships Retail Units | retail_Units | 226,760 | 232,885 | 248,534 | ||||||||
Segment Income | $ 220,413,000 | $ 104,826,000 | $ 117,518,000 | ||||||||
EchoPark Segment Income | 9,146,000 | (52,587,000) | (20,950,000) | ||||||||
Franchised Dealerships Segment Income | 211,267,000 | 157,413,000 | 138,468,000 | ||||||||
Total consolidated revenues | 2,748,404,000 | $ 2,702,720,000 | $ 2,614,081,000 | $ 2,389,138,000 | 2,574,259,000 | 2,470,849,000 | $ 2,505,749,000 | $ 2,400,773,000 | |||
Revenues | $ 2,748,404,000 | $ 2,702,720,000 | $ 2,614,081,000 | $ 2,389,138,000 | $ 2,574,259,000 | $ 2,470,849,000 | $ 2,505,749,000 | $ 2,400,773,000 | |||
EchoPark Segment Revenue | 1,162,018 | 700,177 | 254,309 | ||||||||
EchoPark F&I Revenue | 113,834 | 60,709 | 14,972 | ||||||||
EchoPark Fixed Ops Revenue | 28,753 | 16,327 | 14,208 | ||||||||
EchoPark Wholesale Revenue | 22,927 | 20,443 | 9,483 | ||||||||
EchoPark Used Vehicle Revenue | 996,504 | 602,698 | 215,646 | ||||||||
Franchised Dealerships Segment Revenue | 9,292,325 | 9,251,453 | 9,612,899 | ||||||||
Franchised Dealerships F&I Revenue | 363,117 | 344,814 | 348,058 | ||||||||
Franchised Dealerships Fixed Ops Revenue | 1,366,550 | 1,364,559 | 1,401,802 | ||||||||
Franchised Dealerships New Vehicle Revenue | 4,889,171 | 4,974,097 | 5,295,051 | ||||||||
Franchised Dealerships Used Vehicle Revenue | 2,493,467 | 2,370,799 | 2,406,407 | ||||||||
Franchised Dealerships Wholesale Revenue | $ 180,020 | $ 197,184 | $ 161,581 |
Summary of Quarterly Financial
Summary of Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Consolidated Statements of Income by Quarter | The following table summarizes our results of operations as presented in the accompanying consolidated statements of income by quarter for 2019 and 2018: First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) Year Ended December 31, 2019 Total revenues (1) $ 2,389,138 $ 2,614,081 $ 2,702,720 $ 2,748,404 Gross profit (1) $ 359,011 $ 381,311 $ 386,811 $ 393,884 Net income (loss) (2) $ 42,221 $ 26,599 $ 29,010 $ 46,307 Earnings (loss) per common share - Basic (2) (3) $ 0.98 $ 0.62 $ 0.67 $ 1.07 Earnings (loss) per common share - Diluted (2) (3) $ 0.98 $ 0.61 $ 0.66 $ 1.04 Year Ended December 31, 2018 Total revenues (1) $ 2,400,773 $ 2,505,749 $ 2,470,849 $ 2,574,259 Gross profit (1) $ 352,499 $ 362,375 $ 360,536 $ 370,715 Net income (loss) (2) $ (2,194) $ 16,905 $ 15,118 $ 21,821 Earnings (loss) per common share - Basic (2) (3) $ (0.05) $ 0.40 $ 0.35 $ 0.51 Earnings (loss) per common share - Diluted (2) (3) $ (0.05) $ 0.39 $ 0.35 $ 0.51 (1) Results are for continuing operations. (2) Results include both continuing operations and discontinued operations. (3) The sum of net income per common share for the quarters may not equal the full year amount due to weighted average common shares being calculated on a quarterly versus annual basis. |
Leases, Codification Topic 842
Leases, Codification Topic 842 (Tables) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | |
Lease Cash [Abstract] | |||
Finance Lease, Principal Payments | $ 5,181,000 | ||
Finance Lease, Interest Payment on Liability | 5,097,000 | ||
Operating Lease, Payments | 69,834,000 | ||
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | 10,926,000 | ||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 22,055,000 | ||
Lease Other Information [Abstract] | |||
Finance Lease, Weighted Average Remaining Lease Term | 11 years 9 months 18 days | ||
Operating Lease, Weighted Average Remaining Lease Term | 9 years 6 months | ||
Finance Lease, Weighted Average Discount Rate, Percent | 18.74% | ||
Operating Lease, Weighted Average Discount Rate, Percent | 6.69% | ||
Finance Lease, Liability, Payment, Due [Abstract] | |||
Finance Leases, Future Minimum Payments Due, Due Next Twelve Months | $ 6,985,000 | ||
Finance Leases, Future Minimum Payments Due, Due In Two Years | 7,165,000 | ||
Finance Leases, Future Minimum Payments Due, Due In Three Years | 7,357,000 | ||
Finance Leases, Future Minimum Payments Due, Due In Four Years | 7,374,000 | ||
Finance Leases, Future Minimum Payments Due, Due In Five Years | 7,609,000 | ||
Finance Leases, Future Minimum Payments Due, Due after Five Years | 48,239,000 | ||
Finance Leases, Future Minimum Payments Due, Total | 84,729,000 | ||
Finance Lease, Present Value Discount ASC 840 | (64,140,000) | ||
Finance Lease, Lease Liabilities ASC 840 | 20,589,000 | ||
Finance Lease, ST Lease Liabilities ASC 840 | 643,000 | ||
Finance Lease, LT Lease Liabilities ASC 840 | 19,946,000 | ||
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||
2019 | 82,177,000 | ||
2020 | 66,023,000 | ||
2021 | 51,501,000 | ||
2022 | 37,152,000 | ||
2023 | 33,486,000 | ||
Thereafter | 127,026,000 | ||
Operating Leases, Future Minimum Payments Due | 397,365,000 | ||
Operating Leases, Future Minimum Payments Receivable 840 [Abstract] | |||
Operating Leases, Future Minimum Payments Receivable, Current | 13,430,000 | ||
Operating Leases, Future Minimum Payments Receivable, in Two Years | 10,508,000 | ||
Operating Leases, Future Minimum Payments Receivable, in Three Years | 8,534,000 | ||
Operating Leases, Future Minimum Payments Receivable, in Four Years | 7,232,000 | ||
Operating Leases, Future Minimum Payments Receivable, in Five Years | 7,013,000 | ||
Operating Leases, Future Minimum Payments Receivable, Thereafter | 13,116,000 | ||
Operating Leases, Future Minimum Payments Receivable | 59,833,000 | ||
Finance Lease, Liability, Payment, Due [Abstract] | |||
Finance Lease, Liability, Payments, Due Next Twelve Months | 6,608,000 | ||
Finance Lease, Liability, Payments, Due Year Two | 6,760,000 | ||
Finance Lease, Liability, Payments, Due Year Three | 6,768,000 | ||
Finance Lease, Liability, Payments, Due Year Four | 6,829,000 | ||
Finance Lease, Liability, Payments, Due Year Five | 6,947,000 | ||
Finance Lease, Liability, Payments, Due after Year Five | 43,787,000 | ||
Finance Lease, Liability, Payment, Due | 77,699,000 | ||
Finance Lease, Liability, Undiscounted Excess Amount | 39,822,000 | ||
Finance Lease, Liability, Current | 1,564,000 | $ 728,000 | $ 0 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||
Lessee, Operating Lease, Liability, Payments, Due Next Twelve Months | 64,577,000 | ||
Lessee, Operating Lease, Liability, Payments, Due Year Two | 58,093,000 | ||
Lessee, Operating Lease, Liability, Payments, Due Year Three | 51,337,000 | ||
Lessee, Operating Lease, Liability, Payments, Due Year Four | 49,689,000 | ||
Lessee, Operating Lease, Liability, Payments, Due Year Five | 44,012,000 | ||
Lessee, Operating Lease, Liability, Payments, Due after Year Five | 215,240,000 | ||
Lessee, Operating Lease, Liability, Payments, Due | 482,948,000 | ||
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 135,465,000 | ||
Operating lease liabilities | 347,483,000 | $ 419,500,000 | |
Lessor, Operating Lease, Payments, Fiscal Year Maturity [Abstract] | |||
Lessor, Operating Lease, Payments to be Received, Next Twelve Months | 10,795 | ||
Lessor, Operating Lease, Payments to be Received, Two Years | 8,078 | ||
Lessor, Operating Lease, Payments to be Received, Three Years | 6,103 | ||
Lessor, Operating Lease, Payments to be Received, Four Years | 6,103 | ||
Lessor, Operating Lease, Payments to be Received, Five Years | 5,042 | ||
Lessor, Operating Lease, Payments to be Received, Thereafter | 4,270 | ||
Lessor, Operating Lease, Payments to be Received | 40,391 | ||
Lease, Cost [Abstract] | |||
Finance Lease, ROU Asset, Amortization | 3,213,000 | ||
Finance Lease, Interest Expense | 5,097,000 | ||
Operating Lease, Cost | 68,367,000 | ||
Short-term Lease, Cost | 1,570,000 | ||
Variable Lease, Cost | 2,120,000 | ||
Sublease Income | 14,207,000 | ||
Lease, Cost | $ 66,160,000 |
Description of Business and S_3
Description of Business and Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||||
Dec. 31, 2019USD ($)DealershipsBrandCollisionStateStoreSegmentreporting_unit | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2019USD ($) | Jan. 01, 2018USD ($) | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of operating segments | Segment | 2 | ||||
Number of new vehicle dealerships | Dealerships | 99 | ||||
Number of states | State | 12 | ||||
Number of different brands of cars and light trucks | Brand | 21 | ||||
Number of collision repair centers | Collision | 15 | ||||
Operating lease liabilities | $ 347,483,000 | $ 419,500,000 | |||
ROU assets | 337,842,000 | $ 0 | $ 387,970,000 | ||
Book overdraft position | 0 | ||||
Revenue allowances for commission reserves | 32,000,000 | 25,800,000 | |||
Amount recognized for floor plan assistance | $ 41,500,000 | 42,200,000 | $ 45,300,000 | ||
Term for funding of finance contracts | 10 days | ||||
Contracts in transit included in receivables, net | $ 230,900,000 | 227,800,000 | |||
Receivables, net | $ 432,742,000 | 438,186,000 | $ 486,716,000 | ||
Number of reporting units | reporting_unit | 2 | ||||
Goodwill | $ 475,791,000 | 509,592,000 | 525,780,000 | ||
Insurance reserves | 23,100,000 | 22,900,000 | |||
Concentrations of credit risk with respect to receivables are limited primarily to receivables from automobile manufacturers | 94,800,000 | 93,800,000 | |||
Advertising expense | 60,800,000 | 63,100,000 | 61,600,000 | ||
Cooperative manufacturer credits advertising expenses | $ 25,300,000 | 26,700,000 | $ 26,000,000 | ||
Number of reportable Segment | Segment | 2 | ||||
Financial institutions | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Concentrations of credit risk with respect to receivables are limited primarily to receivables from financial institutions | $ 258,700,000 | ||||
Franchise assets | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Franchise asset impairment charge | 2,100,000 | ||||
Continuing operations | Franchise assets | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Franchise asset impairment charge | $ 0 | $ 2,100,000 | |||
Dealership | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Percentage of dealership that is accounted for under the equity method | 50.00% | ||||
Franchised dealerships | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Goodwill | $ 415,800,000 | ||||
EchoPark | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Goodwill | $ 60,000,000 | ||||
Franchised dealerships | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of Stores | Store | 86 | ||||
EchoPark | |||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of Stores | Store | 9 |
Description of Business and S_4
Description of Business and Summary of Significant Accounting Policies - Cumulative Effect of Adjustments for Adoption of ASC 606 (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | Jan. 01, 2018 | |
Revenues: | |||||
Total revenues | $ 10,454,343 | $ 9,951,630 | $ 9,867,208 | ||
Cost of Sales: | |||||
Work in process | 5,100 | 4,700 | |||
Total cost of sales | (8,933,326) | (8,505,505) | (8,409,532) | ||
Operating income (loss) | 307,706 | 177,663 | 211,565 | ||
Assets: | |||||
Receivables, net | 432,742 | 438,186 | $ 486,716 | ||
Contract with Customer, Asset, Net, Current | 2,082 | ||||
Liabilities: | |||||
Other accrued liabilities | 266,211 | 257,823 | $ 255,836 | 239,249 | |
Deferred income taxes | 53,087 | ||||
Stockholders’ Equity: | |||||
Retained earnings | 790,158 | 670,691 | 663,263 | 629,274 | |
Parts, service and collision repair | |||||
Revenues: | |||||
Total revenues | 1,395,303 | 1,380,887 | 1,416,010 | ||
Cost of Sales: | |||||
Total cost of sales | (727,288) | (713,526) | (732,479) | ||
Finance, insurance and other, net | |||||
Revenues: | |||||
Total revenues | 476,951 | 405,523 | $ 363,030 | ||
Pre-ASC 606 Results | |||||
Cost of Sales: | |||||
Operating income (loss) | 168,962 | ||||
Selling, General and Administrative Expense [Abstract] | |||||
Selling, general and administrative expenses | (1,145,294) | ||||
Pre-ASC 606 Results | Parts, service and collision repair | |||||
Revenues: | |||||
Total revenues | 1,380,506 | ||||
Cost of Sales: | |||||
Total cost of sales | (713,259) | ||||
Pre-ASC 606 Results | Finance, insurance and other, net | |||||
Revenues: | |||||
Total revenues | 396,905 | ||||
Pre-ASC 606 Results | Previously reported | |||||
Assets: | |||||
Receivables, net | 482,126 | ||||
Contract with Customer, Asset, Net, Current | 0 | ||||
Liabilities: | |||||
Other accrued liabilities | 237,963 | ||||
Deferred income taxes | 51,619 | ||||
Stockholders’ Equity: | |||||
Retained earnings | 625,356 | ||||
ASU 2014-09 | Finance, insurance and other, net | |||||
Assets: | |||||
Contract with Customer, Asset, Net, Current | $ 12,900 | 5,400 | |||
ASU 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||||
Cost of Sales: | |||||
Operating income (loss) | 8,701 | ||||
Selling, General and Administrative Expense [Abstract] | |||||
Selling, general and administrative expenses | (31) | ||||
ASU 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Parts, service and collision repair | |||||
Revenues: | |||||
Total revenues | 381 | ||||
Cost of Sales: | |||||
Total cost of sales | (267) | ||||
ASU 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Finance, insurance and other, net | |||||
Revenues: | |||||
Total revenues | 8,618 | ||||
ASU 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Restatement Adjustment [Member] | |||||
Assets: | |||||
Receivables, net | $ 4,590 | ||||
Contract with Customer, Asset, Net, Current | 2,082 | ||||
Liabilities: | |||||
Other accrued liabilities | 1,286 | ||||
Deferred income taxes | 1,468 | ||||
Stockholders’ Equity: | |||||
Retained earnings | $ 3,918 | ||||
7428000 | |||||
Liabilities: | |||||
Other accrued liabilities | (1,987) | ||||
Stockholders’ Equity: | |||||
Retained earnings | $ (7,428) |
Business Acquisitions and Dis_3
Business Acquisitions and Dispositions - Additional Information (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)storeFranchise | Dec. 31, 2018USD ($)store | Dec. 31, 2017USD ($)store | |
Business Acquisition [Line Items] | |||
Number of franchise dealerships opened | 1 | ||
Number of stores opened | 1 | ||
Number of EchoPark opened | 1 | 3 | |
Number of franchises disposed | 1 | 2 | |
Number of franchises disposed mid-line | 9 | 5 | |
Cash generated from disposition | $ | $ 250.7 | $ 128.7 | $ 38.2 |
Number of franchises terminated | 1 | 1 | |
Number of terminated stores | 4 | 2 | |
Number of dealerships held for sale | Franchise | 0 | ||
Pre-owned vehicle store | |||
Business Acquisition [Line Items] | |||
Business acquisition, consideration amount | $ | $ 76.6 |
Business Acquisitions and Dis_4
Business Acquisitions and Dispositions - Revenues and Other Activities Associated with Disposed Dealerships Classified as Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Lease exit accrual adjustments and charges | $ (2,600) | $ (4,800) | |||
Income (loss) from discontinued operations before taxes | $ (554) | $ (1,017) | $ (1,942) | ||
Discontinued operations | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Income (loss) from operations before taxes | (554) | (610) | (735) | ||
Lease exit accrual adjustments and charges | 0 | (407) | (1,207) | ||
Income (loss) from discontinued operations before taxes | $ (554) | $ (1,017) | $ (1,942) |
Business Acquisitions and Dis_5
Business Acquisitions and Dispositions - Revenues and Other Activities Associated with Disposed Dealerships That Remain in Continuing Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Lease exit accrual adjustments and charges | $ (2,600) | $ (4,800) | |||
Disposed dealerships that remain in continuing operations | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Income (loss) from operations before taxes and items below | $ 3,154 | $ (4,313) | $ (736) | ||
Gain (loss) on disposal of dealerships (1) | 76,461 | 39,307 | 9,974 | ||
Lease exit accrual adjustments and charges | 170 | 210 | (1,207) | ||
Impairment charges | 0 | (4,180) | (318) | ||
Income (loss) before taxes | 79,785 | 31,024 | 7,713 | ||
Total revenues | $ 307,849 | $ 783,275 | $ 1,140,514 |
Inventories and Related Notes_3
Inventories and Related Notes Payable - Floor Plan - Components of Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
New vehicles | $ 983,123 | $ 1,027,727 |
Used vehicles | 319,791 | 293,179 |
Service loaners | 152,278 | 141,542 |
Parts, accessories and other | 62,683 | 66,013 |
Net inventories | $ 1,517,875 | $ 1,528,461 |
Inventories and Related Notes_4
Inventories and Related Notes Payable - Floor Plan - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |||
Average interest rate for new vehicle floor plan facilities | 3.03% | 3.10% | 2.37% |
Amount recognized for floor plan assistance | $ 41.5 | $ 42.2 | $ 45.3 |
Average interest rate for used vehicle floor plan facilities | 3.10% | 2.98% | 2.61% |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | |||
Less accumulated depreciation | $ (616,611) | $ (575,720) | |
Subtotal | 1,123,487 | 1,185,351 | |
Less assets held for sale | (26,240) | (6,862) | |
Property and equipment, net | 1,097,247 | $ 1,159,541 | 1,178,489 |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Total, at cost | 373,301 | 381,527 | |
Building and improvements (1) | |||
Property, Plant and Equipment [Line Items] | |||
Total, at cost | 969,609 | 989,872 | |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total, at cost | 346,260 | 330,149 | |
Construction in Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total, at cost | 50,928 | 59,523 | |
Property, Plant and Equipment, Net, Excluding Capital Leased Assets | |||
Property, Plant and Equipment [Line Items] | |||
Total, at cost | $ 1,740,098 | $ 1,761,071 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Interest capitalized in conjunction with construction projects and software development | $ 1.6 | $ 1.5 | $ 2.2 |
Commitments for facility construction projects | $ 18 |
Property and Equipment - Impair
Property and Equipment - Impairment Charges (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Franchise PPE Impair | $ 1,101 | $ 25,832 | $ 3,890 |
EchoPark PPE Impair | 19,667 | 1,582 | 1,004 |
Property and equipment impairment charges | $ 20,768 | $ 27,414 | $ 4,894 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Changes in Carrying Amount of Franchise Assets and Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Net Goodwill | ||
Beginning balance | $ 509,592 | $ 525,780 |
Reductions from dispositions | (33,801) | (16,188) |
Reductions from impairment | 0 | |
Ending balance | 475,791 | 509,592 |
Net of accumulated impairment losses | 797,600 | 797,600 |
Franchise assets | ||
Franchise Assets | ||
Beginning balance | 65,700 | 69,900 |
Reductions from dispositions | (1,400) | (2,100) |
Reductions from impairment | (2,100) | |
Ending balance | 64,300 | 65,700 |
Continuing operations | Franchise assets | ||
Franchise Assets | ||
Reductions from impairment | $ 0 | $ (2,100) |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill impairment | $ 0 | |
Franchise assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite life Intangible asset, impairment charge | 2,100 | |
Franchise assets | Continuing operations | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite life Intangible asset, impairment charge | $ 0 | $ 2,100 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Mar. 10, 2017 | May 09, 2013 |
Debt Instrument [Line Items] | |||||
Other | $ 0 | $ 20,589 | |||
Mortgage notes to finance companies - fixed rate, bearing interest from 3.51% to 7.03% | 714,968 | 956,017 | |||
Debt issuance costs | (8,082) | (10,934) | |||
Total debt | 706,886 | 945,083 | |||
Less current maturities | (69,908) | (26,304) | |||
Long-Term Debt | 636,978 | $ 898,222 | 918,779 | ||
Mortgage notes | |||||
Debt Instrument [Line Items] | |||||
Long-term Debt, Percentage Bearing Fixed Interest, Amount | 194,535 | 215,196 | |||
Long-term Debt, Percentage Bearing Variable Interest, Amount | 161,345 | 180,959 | |||
Mortgage notes to finance companies - fixed rate, bearing interest from 3.51% to 7.03% | 355,900 | ||||
2019 Mortgage Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Long-term Debt, Percentage Bearing Variable Interest, Amount | 109,088 | 0 | |||
2016 Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
2016 Revolving Credit Facility | 0 | 0 | |||
5.0% Senior Subordinated Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Senior Subordinated Notes | 0 | 289,273 | |||
Total debt | 0 | 289,273 | |||
Stated interest rate on debt agreement | 5.00% | ||||
6.125% Notes | |||||
Debt Instrument [Line Items] | |||||
Senior Subordinated Notes | 250,000 | 250,000 | |||
Total debt | $ 250,000 | $ 250,000 | |||
Stated interest rate on debt agreement | 6.125% | 6.125% | 6.125% | ||
2019 Mortgage Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Mortgage notes to finance companies-variable rate, percentage | 10910000000.00% | ||||
Debt Instrument, Unused Borrowing Capacity, Amount | $ 3,100 | ||||
Long Term Debt Prepayment | $ 500 |
Long-Term Debt - Future Maturit
Long-Term Debt - Future Maturities of Long-Term Debt (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Debt Disclosure [Abstract] | |
2019 | $ 69,908 |
2020 | 63,274 |
2021 | 50,241 |
2022 | 68,857 |
2023 | 108,462 |
Thereafter | 354,226 |
Total | $ 714,968 |
Long-Term Debt Long-Term Debt -
Long-Term Debt Long-Term Debt - 2016 Credit Facilities (Details) - USD ($) | Nov. 30, 2016 | Dec. 31, 2019 | Dec. 31, 2018 |
Line of Credit Facility [Line Items] | |||
Maximum Borrowing 2019 Mortgage Facility | $ 112,200,000 | ||
2016 Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
2016 Revolving Credit Facility | 0 | $ 0 | |
Revolving Credit Facility | 2016 Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Increased availability under borrowing facility | $ 25,000,000 | ||
Current borrowing capacity | 250,000,000 | ||
Maximum borrowing capacity | 300,000,000 | ||
Borrowing base | 245,300,000 | ||
2016 Revolving Credit Facility | 0 | ||
Letters of credit outstanding amount | 14,600,000 | ||
Borrowing availability amount | 230,700,000 | ||
Revolving Credit Facility | 2016 Floor Plan Facilities | |||
Line of Credit Facility [Line Items] | |||
Increased availability under borrowing facility | $ 215,000,000 | ||
Current borrowing capacity | 1,015,000,000 | ||
Maximum borrowing capacity | $ 1,265,000,000 | ||
Revolving Credit Facility | 2016 Used Vehicle Floor Plan Facility | |||
Line of Credit Facility [Line Items] | |||
Allocation of credit facility increase, percentage | 30.00% |
Long-Term Debt - Notes Narrativ
Long-Term Debt - Notes Narrative (Details) - USD ($) | Mar. 10, 2017 | Dec. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2018 | Mar. 27, 2017 | May 09, 2013 |
Debt Instrument [Line Items] | ||||||
Loss on Debt Redemption 5 Percent Notes | $ 6,700,000 | |||||
Outstanding mortgage principal balance | 714,968,000 | $ 956,017,000 | ||||
Double Carry Interest | $ (500,000) | $ 700,000 | ||||
Mortgage notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt weighted average interest rate on note | 4.36% | |||||
Outstanding mortgage principal balance | $ 355,900,000 | |||||
6.125% Notes | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate on debt agreement | 6.125% | 6.125% | 6.125% | |||
Principal amount | $ 250,000,000 | |||||
Notes issued at a price of principal amount | 100.00% | |||||
Redemption Price | 106.125% | |||||
Notes redemption price percentage of the par value due to change of control | 101.00% | |||||
Debt instrument maximum allowed dividends per share (usd per share) | $ 0.12 | |||||
Outstanding principal amount of the 6.125% notes | 25.00% | |||||
6.125% Notes | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Notes redemption price percentage of the principal amount | 35.00% | |||||
6.125% Notes | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Indebtedness with outstanding balance under other agreements | $ 50,000,000 | |||||
7.0% Senior Subordinated Notes due 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate on debt agreement | 7.00% | |||||
5.0% Senior Subordinated Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Stated interest rate on debt agreement | 5.00% | |||||
Principal amount | $ 300,000,000 | |||||
Outstanding notes repurchased amount | 289,300,000 | 10,700,000 | ||||
Repurchase amount paid in cash, plus accrued and unpaid interest related thereto | $ 295,900,000 | $ 10,600,000 | ||||
2019 Mortgage Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Redemption Price | 1.667% |
Long-Term Debt - Redemption Pri
Long-Term Debt - Redemption Price, Percentage (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Debt Instrument, Redemption [Line Items] | |
Loss on Debt Redemption 5 Percent Notes | $ 6,700 |
6.125% Notes | |
Debt Instrument, Redemption [Line Items] | |
Redemption Price | 106.125% |
6.125% Notes | Beginning on March 15, 2022 | |
Debt Instrument, Redemption [Line Items] | |
Redemption Price | 103.063% |
6.125% Notes | Beginning on March 15, 2023 | |
Debt Instrument, Redemption [Line Items] | |
Redemption Price | 102.042% |
6.125% Notes | Beginning on March 15, 2024 | |
Debt Instrument, Redemption [Line Items] | |
Redemption Price | 101.021% |
6.125% Notes | Beginning on March 15, 2025 and thereafter | |
Debt Instrument, Redemption [Line Items] | |
Redemption Price | 100.00% |
Long-Term Debt - Financial Cove
Long-Term Debt - Financial Covenants Include Required Specified Ratios (Details) | Dec. 31, 2019 |
Line of Credit Facility [Line Items] | |
Minimum Consolidated Liquidity Ratio | 111.00% |
Minimum Consolidated Fixed Charge Coverage Ratio | 160.00% |
Maximum Consolidated Total Lease Adjusted Leverage Ratio | 321.00% |
Required ratio | |
Line of Credit Facility [Line Items] | |
Minimum Consolidated Liquidity Ratio | 105.00% |
Minimum Consolidated Fixed Charge Coverage Ratio | 120.00% |
Maximum Consolidated Total Lease Adjusted Leverage Ratio | 575.00% |
Long-Term Debt Long-Term Debt_2
Long-Term Debt Long-Term Debt - Covenants (Details) | Dec. 31, 2019USD ($) |
Line of Credit Facility [Line Items] | |
Minimum EBTDAR to rent ratio | 557.00% |
Required ratio | |
Line of Credit Facility [Line Items] | |
Minimum EBTDAR to rent ratio | 150.00% |
2016 Credit facility | |
Line of Credit Facility [Line Items] | |
Minimum EBTDAR to rent ratio | 557.00% |
2016 Credit facility | Required ratio | |
Line of Credit Facility [Line Items] | |
Minimum EBTDAR to rent ratio | 150.00% |
2016 Credit facility | Minimum | |
Line of Credit Facility [Line Items] | |
Net income and retained earnings free of restrictions | $ 259,900,000 |
Long-Term Debt - Derivative Ins
Long-Term Debt - Derivative Instruments and Hedging Activities Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Derivatives, Fair Value [Line Items] | |||
Cash premiums paid | $ 2,500 | $ 2,800 | |
Unamortized premium | 3,700 | 4,600 | |
Incremental interest expense | 1,200 | 200 | $ 3,100 |
Net benefit expected to be reclassified | 1,300 | ||
Designated as hedging instrument | Interest rate swap | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability, fair value of interest rate swap and cap positions | 100 | 4,800 | |
Designated as hedging instrument | Other current assets | Interest rate swap | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability, fair value of interest rate swap and cap positions | $ 100 | 1,800 | |
Designated as hedging instrument | Other assets | Interest rate swap | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset, fair value of interest rate swap and cap positions | $ 3,000 |
Long-Term Debt - Summary of Int
Long-Term Debt - Summary of Interest Received and Paid under Term of Cash Flow Swap (Details) | Dec. 31, 2019USD ($) |
Derivatives, Fair Value [Line Items] | |
Payment of interest rate | $ 0 |
One-month LIBOR rate | 1.763% |
Cash Flow Swap A | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 312,500,000 |
Pay Rate | 2.00% |
Cash Flow Swap B | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 250,000,000 |
Pay Rate | 3.00% |
Cash Flow Swap C | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 225,000,000 |
Pay Rate | 3.00% |
Cash Flow Swap D | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 150,000,000 |
Pay Rate | 2.00% |
Cash Flow Swap E | |
Derivatives, Fair Value [Line Items] | |
Notional Amount | $ 250,000,000 |
Pay Rate | 3.00% |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes for Continuing Operations - Benefit (Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Federal | $ (62,016) | $ (37,028) | $ (34,877) |
State | (12,563) | (7,411) | (7,292) |
Total current | (74,579) | (44,439) | (42,169) |
Deferred | 19,471 | 21,517 | 28,198 |
Total provision for income taxes for continuing operations - benefit (expense) | $ (55,108) | $ (22,922) | $ (13,971) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2019 | Jan. 01, 2019 | |
Income Taxes [Line Items] | |||
Provision for income taxes benefit (expense) related to remeasurement of net deferred tax liability | $ 28,400 | ||
Net long-term deferred tax asset | 3,700 | $ 3,000 | |
Net long-term deferred tax liability | 33,178 | 8,927 | $ 30,144 |
Gross deferred tax assets related to state net operating loss carryforwards | 248,400 | ||
Valuation allowance related to certain state net operating loss carryforward deferred tax assets | 7,800 | ||
Liabilities recorded related to unrecognized tax benefits | 5,500 | ||
Liabilities related to interest and penalties | 500 | $ 600 | |
Unrecognized tax benefit that would affect income tax rate if recognized | $ 4,900 | $ 3,800 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the Statutory Federal Income Tax Rate with Federal and State Overall Effective Income Tax Rate from Continuing Operations (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. statutory federal income tax rate | 21.00% | 21.00% | 35.00% |
Effective state income tax rate | 4.10% | 4.60% | 4.58% |
Valuation allowance adjustments | (0.18%) | 0.20% | (0.59%) |
Uncertain tax positions | (0.45%) | 0.17% | 0.71% |
Effect of change in future U.S. statutory federal income tax rate | 0.00% | 0.00% | (26.27%) |
Non-deductible compensation | 1.48% | 3.06% | 0.23% |
Other | 1.65% | 1.41% | (0.74%) |
Effective income tax rate | 27.60% | 30.44% | 12.92% |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Accruals and reserves | $ 27,271 | $ 24,948 |
State net operating loss carryforwards | 10,771 | 12,687 |
Basis difference in property and equipment | 20,923 | 11,515 |
Fair value of interest rate swaps | 1,153 | 0 |
Deferred Tax Assets Basis Difference Related to ROU Assets | 93,808 | 0 |
Interest and state taxes associated with the liability for uncertain income tax positions | 938 | 1,175 |
Other | 2,146 | 1,778 |
Other | 157,010 | 52,103 |
Deferred tax liabilities: | ||
Fair value of interest rate swaps and caps | 0 | (462) |
Basis difference in inventories | (804) | (838) |
Basis difference in goodwill | (61,397) | (69,646) |
Deferred Tax Liability Basis Difference in ROU Assets | (90,679) | 0 |
Other | (2,316) | (2,544) |
Total deferred tax liabilities | (155,196) | (73,490) |
Valuation allowance | (7,775) | (8,138) |
Net deferred tax asset (liability) | $ (5,961) | $ (29,525) |
Income Taxes - Summary of Chang
Income Taxes - Summary of Changes in Liability Related to Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Unrecognized tax benefit liability, Beginning Balance | $ 4,901 | $ 4,645 | $ 4,357 | |
New positions | 0 | 0 | 653 | |
Prior period positions: | ||||
Increases | 1,795 | 7 | 491 | |
Decreases | (2,697) | (199) | (539) | |
Increases from current period positions | 582 | 714 | 692 | |
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities | 653 | 0 | 0 | |
Lapse of statute of limitations | (8) | (69) | (781) | |
Other | (81) | (197) | (228) | |
Unrecognized tax benefit liability, Ending Balance | 3,839 | 4,901 | 4,645 | |
Accrued interest and penalties | 500 | 600 | 600 | $ 800 |
State | ||||
Schedule Of Unrecognized Tax Benefits [Line Items] | ||||
Net operating losses | $ 0 | $ 0 | $ 100 |
Related Parties - Additional In
Related Parties - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
SFC | |||
Related Party Transaction [Line Items] | |||
Aggregate annual rent for leased aircraft usage | $ 0.3 | $ 0.3 | $ 0.4 |
Oil-Chem | |||
Related Party Transaction [Line Items] | |||
Purchase from related party | 1.6 | 1.6 | 1.9 |
SMISC Holdings, Inc. | |||
Related Party Transaction [Line Items] | |||
Purchase from related party | 0.9 | 0.9 | 0.9 |
SMI subsidiaries | |||
Related Party Transaction [Line Items] | |||
Vehicle sales to related party | $ 0.2 | $ 0.2 | $ 0.2 |
Minimum | Mr. Marcus G. Smith | SFC | |||
Related Party Transaction [Line Items] | |||
Ownership percentage | 10.00% |
Capital Structure and Per Sha_2
Capital Structure and Per Share Data - Additional Information (Details) | 12 Months Ended | |
Dec. 31, 2019USD ($)ClassVote$ / sharesshares | Dec. 31, 2018USD ($) | |
Capital Structure And Per Share Data [Line Items] | ||
Preferred stock shares authorized | 3,000,000 | |
Preferred stock, issued | 0 | |
Number of classes of common stock | Class | 2 | |
Class A convertible preferred stock | ||
Capital Structure And Per Share Data [Line Items] | ||
Preferred stock shares authorized | 300,000 | |
Preferred Stock par value (in dollars per share) | $ / shares | $ 0.10 | |
Preferred stock shares redeemed | 13,801.5 | |
Preferred stock redemption price (in dollars per share) | $ / shares | $ 1,000 | |
Series I Preferred Stock | ||
Capital Structure And Per Share Data [Line Items] | ||
Preferred stock authorized (in shares) | 100,000 | |
Series II Preferred Stock | ||
Capital Structure And Per Share Data [Line Items] | ||
Preferred stock authorized (in shares) | 100,000 | |
Series III Preferred Stock | ||
Capital Structure And Per Share Data [Line Items] | ||
Preferred stock authorized (in shares) | 100,000 | |
Class A common stock | ||
Capital Structure And Per Share Data [Line Items] | ||
Common stock, shares authorized | 100,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | |
Common stock, number of votes per share | Vote | 1 | |
Number of shares of class A common stock issuable against each share of class B common stock | 1 | |
Authorized amount expend on repurchase of shares | $ | $ 695,000,000 | |
Common stock class A, shares repurchased | 33,600,000 | |
Common stock class A, share repurchase price per share (in dollars per share) | $ / shares | $ 17.84 | |
Remaining authorized amount | $ | $ 81,200,000 | |
Class B common stock | ||
Capital Structure And Per Share Data [Line Items] | ||
Common stock, shares authorized | 30,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | |
Common stock, number of votes per share | Vote | 10 |
Capital Structure and Per Sha_3
Capital Structure and Per Share Data - Dilutive Effect on Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Jan. 01, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Earnings Per Share [Abstract] | ||||||||||||
Weighted Average Shares (in shares) | 43,016 | 42,708 | 43,997 | |||||||||
Weighted Average Shares, Diluted (in shares) | 43,710 | 42,950 | 44,358 | |||||||||
Income (Loss) From Continuing Operations | $ 144,537 | $ 52,390 | $ 94,153 | |||||||||
Income (Loss) From Continuing Operations, Basic, Per Share Amount (usd per share) | $ 3.36 | $ 1.23 | $ 2.14 | |||||||||
Income (Loss) From Continuing Operations, Diluted (usd per share) | $ 3.31 | $ 1.22 | $ 2.12 | |||||||||
Income (Loss) From Discontinued Operations, Earnings (loss), Amount | $ (400) | $ (740) | $ (1,170) | |||||||||
Income (Loss) From Discontinued Operations, Basic earnings (loss), Per Share Amount (usd per share) | $ (0.01) | $ (0.02) | $ (0.03) | |||||||||
Income (Loss) From Discontinued Operations, Diluted earnings (loss), Per Share Amount (usd per share) | $ (0.01) | $ (0.02) | $ (0.03) | |||||||||
Net Income (Loss), Amount | $ 144,137 | $ 46,307 | $ 29,010 | $ 26,599 | $ 42,221 | $ 21,821 | $ 15,118 | $ 16,905 | $ (2,194) | $ 144,137 | $ 51,650 | $ 92,983 |
Earnings (loss) per common share (usd per share) | $ 1.07 | $ 0.67 | $ 0.62 | $ 0.98 | $ 0.51 | $ 0.35 | $ 0.40 | $ (0.05) | $ 3.35 | $ 1.21 | $ 2.11 | |
Earnings (loss) per common share (usd per share) | $ 1.04 | $ 0.66 | $ 0.61 | $ 0.98 | $ 0.51 | $ 0.35 | $ 0.39 | $ (0.05) | $ 3.30 | $ 1.20 | $ 2.09 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) | 12 Months Ended | ||||||
Dec. 31, 2019USD ($)EmployerMembersPlansshares | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2019shares | Jun. 30, 2018shares | Jun. 30, 2016shares | Jun. 30, 2013shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of active stock compensation plans | Plans | 2 | ||||||
Restricted stock shares | shares | 968,000 | ||||||
Number of employers obligated to make contribution under multiemployer plan | Employer | 188 | ||||||
Number of employee increase / (decrease) under multiemployer benefit percentage | (5.50%) | 1.00% | |||||
Total contributions of multi employer Plan | 5.00% | ||||||
SERP | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Members of senior management | Members | 12 | ||||||
Options | Selling, general and administrative expenses | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation expense | $ | $ 0 | $ 0 | $ 0 | ||||
Restricted stock units and restricted stock awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Tax benefit recognized | $ | 2,900,000 | 3,000,000 | 4,200,000 | ||||
Restricted stock units and restricted stock awards | Selling, general and administrative expenses | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation expense | $ | 10,800,000 | 11,900,000 | 11,100,000 | ||||
Restricted stock units and restricted stock awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation expense not yet recognized | $ | $ 29,100,000 | ||||||
Total compensation cost related to non-vested options expected to be recognized over weighted average period | 6 years 6 months | ||||||
401(k) plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Employer contribution | $ | $ 8,900,000 | $ 9,200,000 | $ 8,000,000 | ||||
2012 Formula Plan | Restricted stock awards | Board of Directors | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock shares | shares | 57,000 | ||||||
2012 Formula Plan | Class A common stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized | shares | 500,000 | 300,000 | |||||
2012 Plan | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock award vesting period | 3 years | ||||||
2012 Plan | Restricted stock units | Executive officers and other key associates | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock shares | shares | 911,000 | ||||||
2012 Plan | Class A common stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized | shares | 6,000,000 | 4,000,000 | 2,000,000 | ||||
2012 Formula Plan and 2004 Plan | Class A common stock | Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock option expiration period | 10 years | ||||||
2012 Formula Plan and 2004 Plan | Class A common stock | Options | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock award vesting period | 6 months | ||||||
2012 Formula Plan and 2004 Plan | Class A common stock | Options | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock award vesting period | 3 years | ||||||
2012 Formula Plan and 2004 Plan | Class A common stock | Restricted stock awards and restricted stock units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock award vesting period | 1 year | ||||||
2012 Formula Plan and 2004 Plan | Class A common stock | Restricted stock awards and restricted stock units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock award vesting period | 3 years |
Employee Benefit Plans - Status
Employee Benefit Plans - Status of Stock Options Related to Stock Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding Beginning Balance | 33,000 | ||
Options Outstanding Exercised | (33,000) | ||
Options Outstanding Ending Balance | 33,000 | ||
Weighted Average Exercise Price Per Share, Beginning Balance | $ 1.81 | ||
Weighted Average Exercise Price Per Share, Exercised | $ 1.81 | ||
Weighted Average Exercise Price Per Share, Ending Balance | $ 1.81 | ||
Weighted Average Remaining Contractual Term | 3 months 18 days | ||
Aggregate Intrinsic Value, Beginning Balance | $ 392 | ||
Intrinsic value of stock options exercised | $ 426 | $ 3,564 | $ 425 |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise Price Per Share, Beginning Balance | $ 1.81 | ||
Exercise Price Per Share, Exercised | 1.81 | ||
Exercise Price Per Share, Ending Balance | $ 1.81 | ||
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Exercise Price Per Share, Beginning Balance | 1.81 | ||
Exercise Price Per Share, Exercised | $ 1.81 | ||
Exercise Price Per Share, Ending Balance | $ 1.81 |
Employee Benefit Plans - Stat_2
Employee Benefit Plans - Status of Non-Vested Restricted Stock and Restricted Stock Unit Grants Related to Stock Plans (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Retirement Benefits [Abstract] | |
Non-vested Restricted Stock Awards and Restricted Stock Units, Beginning Balance | shares | 2,161 |
Non-vested Restricted Stock Awards and Restricted Stock Units, Granted | shares | 968 |
Non-vested Restricted Stock Awards and Restricted Stock Units, Forfeited | shares | (295) |
Non-vested Restricted Stock Awards and Restricted Stock Units, Vested | shares | (487) |
Non-vested Restricted Stock Awards and Restricted Stock Units, Ending Balance | shares | 2,347 |
Weighted Average Grant Date Fair Value per Share, Beginning Balance | $ / shares | $ 21.20 |
Weighted Average Grant Date Fair Value per Share, Granted | $ / shares | 13.38 |
Weighted Average Grant Date Fair Value per Share, Forfeited | $ / shares | 19.75 |
Weighted Average Grant Date Fair Value per Share, Vested | $ / shares | 18.82 |
Weighted Average Grant Date Fair Value per Share, Ending Balance | $ / shares | $ 19.34 |
Employee Benefit Plans - Stat_3
Employee Benefit Plans - Status of Supplemental Executive Retirement Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2019 | Jan. 01, 2018 | |
Change in fair value of plan assets: | ||||
Plan assets at January 1 | $ 0 | |||
Actual return on plan assets | 0 | $ 0 | ||
Plan assets at December 31 | 0 | |||
Other Long-Term Liabilities | 73,746 | 75,887 | $ 73,379 | |
Other accrued liabilities | 266,211 | 257,823 | $ 255,836 | $ 239,249 |
SERP | ||||
Change in projected benefit obligation: | ||||
Obligation at beginning of year | 13,326 | 13,556 | ||
Service cost | 1,731 | 1,933 | ||
Interest cost | 575 | 470 | ||
Actuarial loss (gain) | 2,641 | (2,368) | ||
Amendments/settlements/curtailments loss (gain) | 0 | 0 | ||
Benefits paid | (265) | (265) | ||
Obligation at end of year | 18,008 | 13,326 | ||
Accumulated benefit obligation | 13,694 | 10,191 | ||
Change in fair value of plan assets: | ||||
Plan assets at January 1 | 0 | 0 | ||
Employer contributions | 265 | 265 | ||
Benefits paid | (265) | (265) | ||
Plan assets at December 31 | 0 | 0 | ||
Funded status recognized | (18,008) | (13,326) | ||
Other Long-Term Liabilities | 17,600 | 13,000 | ||
Other accrued liabilities | $ 400 | $ 300 |
Employee Benefit Plans - Cost C
Employee Benefit Plans - Cost Components of Supplemental Executive Retirement Plan (Details) - SERP - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 1,731 | $ 1,933 |
Interest cost | 575 | 470 |
Net pension expense (benefit) | $ 2,306 | $ 2,403 |
Employee Benefit Plans - Weight
Employee Benefit Plans - Weighted Average Assumptions Used to Determine Benefit Obligation and Net Periodic Benefit Costs (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Retirement Benefits [Abstract] | ||
Discount rate | 2.99% | 4.36% |
Rate of compensation increase | 3.00% | 3.00% |
Employee Benefit Plans - Estima
Employee Benefit Plans - Estimated Future Benefit Payments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Retirement Benefits [Abstract] | |
2019 | $ 360 |
2020 | 360 |
2021 | 360 |
2022 | 360 |
2023 | 360 |
2025 - 2029 | $ 2,414 |
Employee Benefit Plans - Schedu
Employee Benefit Plans - Schedule of Multi-Employer Pension Plans Affecting Period-to-Period Comparability of Contributions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |||
Pension Fund | AI Pension Plan | ||
Entity Tax Identification Number | 56-2010790 | ||
Pension Protection Act Zone Status | Red | Red | |
Sonic Contributions | $ 181 | $ 176 | $ 171 |
Surcharge Imposed | Yes | ||
Collective-Bargaining Agreement Expiration Date | BetweenOctober 2021and February 2022 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Recorded at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Other current assets | ||
Assets: | ||
Cash flow swaps and interest rate caps designated as hedges | $ 1,800 | |
Other assets | ||
Assets: | ||
Cash flow swaps and interest rate caps designated as hedges | $ 100 | 3,000 |
Fair Value Based on Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Cash surrender value of life insurance policies | 32,799 | 31,395 |
Cash flow swaps and interest rate caps designated as hedges | 97 | 4,839 |
Total assets | 32,896 | 36,234 |
Liabilities: | ||
Deferred compensation plan | 17,890 | 19,848 |
Total liabilities | $ 17,890 | $ 19,848 |
Fair Value Measurements - Ass_2
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | |||
Total Gain (loss) on long-lived assets held and used | $ (20,768) | $ (27,414) | $ (4,894) |
Total Gain (loss) on goodwill | $ 0 | ||
Non-recurring basis | |||
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | |||
Impairment of Long-Lived Assets Held-for-use | (1,345) | ||
Total Gain (loss) on long-lived assets held and used | (17,741) | ||
Disposal Group, Not Discontinued Operation, Loss (Gain) on Write-down | 1,700 | ||
Non-recurring basis | Significant Unobservable Inputs (Level 3) as of December 31, 2019 | |||
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | |||
Long-lived assets held and used | 7,286 | ||
Assets Held-for-sale, Long Lived, Fair Value Disclosure | $ 23,030 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value and Carrying Value of Fixed Rate Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Mar. 10, 2017 | May 09, 2013 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Long-term Debt, Carrying Value | $ 706,886 | $ 945,083 | ||
5.0% Notes | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Long-term Debt, Fair Value | 0 | 262,515 | ||
Long-term Debt, Carrying Value | 0 | 289,273 | ||
Stated interest rate on debt agreement | 5.00% | |||
6.125% Notes | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Long-term Debt, Fair Value | 261,250 | 216,250 | ||
Long-term Debt, Carrying Value | $ 250,000 | $ 250,000 | ||
Stated interest rate on debt agreement | 6.125% | 6.125% | 6.125% | |
Mortgage Notes | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Long-term Debt, Fair Value | $ 195,962 | $ 218,402 | ||
Long-term Debt, Carrying Value | 194,535 | 215,196 | ||
Other | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Long-term Debt, Fair Value | 0 | 20,437 | ||
Long-term Debt, Carrying Value | $ 0 | $ 20,588 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Contingencies And Commitments [Line Items] | ||
Maximum exposure associated with general indemnifications | $ 46.5 | |
Contingent liability reserve balance after reduction | 4.3 | |
Other accrued liabilities | ||
Contingencies And Commitments [Line Items] | ||
Amount reserved for pending proceedings | 1.2 | $ 2.4 |
Other long-term liabilities | ||
Contingencies And Commitments [Line Items] | ||
Amount reserved for pending proceedings | $ 0.3 | |
Dealership | ||
Contingencies And Commitments [Line Items] | ||
Joint venture ownership percentage | 50.00% | |
Minimum | ||
Contingencies And Commitments [Line Items] | ||
General indemnifications expiration period | 1 year | |
Maximum | ||
Contingencies And Commitments [Line Items] | ||
General indemnifications expiration period | 3 years |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Lease Exit Accruals (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Beginning balance | $ 4,634,000 | ||
Lease exit expense | (4,634,000) | $ 1,400,000 | $ 300,000 |
Ending balance | $ 0 | $ 4,634,000 |
Commitments and Contingencies_3
Commitments and Contingencies - Future Minimum Lease Payments for both Continuing and Discontinued Operations (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 82,177 |
2020 | 66,023 |
2021 | 51,501 |
2022 | 37,152 |
2023 | 33,486 |
Thereafter | $ 127,026 |
Commitments and Contingencies_4
Commitments and Contingencies - Financial Covenants Related to Amended Subordination and Guaranty Agreement (Details) | Dec. 31, 2019 |
Subordination Agreement And Additional Financial Covenant [Line Items] | |
Minimum Consolidated Liquidity Ratio | 111.00% |
Minimum Consolidated Fixed Charge Coverage Ratio | 160.00% |
Maximum Consolidated Total Lease Adjusted Leverage Ratio | 321.00% |
Minimum EBTDAR to rent ratio | 557.00% |
Required ratio | |
Subordination Agreement And Additional Financial Covenant [Line Items] | |
Minimum Consolidated Liquidity Ratio | 105.00% |
Minimum Consolidated Fixed Charge Coverage Ratio | 120.00% |
Maximum Consolidated Total Lease Adjusted Leverage Ratio | 575.00% |
Minimum EBTDAR to rent ratio | 150.00% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Summary of Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | $ 823,116 | $ 786,760 | $ 725,164 |
Other comprehensive income (loss) before reclassifications | (3,581) | ||
Amounts reclassified out of accumulated other comprehensive income (loss) | (2,714) | ||
Other comprehensive income (loss) | (6,295) | 2,926 | 3,569 |
Ending Balance | 944,764 | 823,116 | 786,760 |
Other comprehensive income (loss) before reclassifications, tax expense | (836) | ||
Tax benefit associated with change in pension actuarial loss | 734 | ||
Amounts reclassified out of accumulated other comprehensive income (loss), tax expense | (1,108) | ||
Gains and (Losses) on Cash Flow Hedges | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 3,034 | ||
Other comprehensive income (loss) before reclassifications | (1,646) | ||
Amounts reclassified out of accumulated other comprehensive income (loss) | (2,714) | ||
Other comprehensive income (loss) | (4,360) | ||
Ending Balance | (1,326) | 3,034 | |
Defined Benefit Pension Plan | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 1,199 | ||
Other comprehensive income (loss) before reclassifications | (1,935) | ||
Amounts reclassified out of accumulated other comprehensive income (loss) | 0 | ||
Other comprehensive income (loss) | (1,935) | ||
Ending Balance | (736) | 1,199 | |
Accumulated Other Comprehensive Income (Loss) | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 4,233 | 1,307 | (2,262) |
Ending Balance | $ (2,062) | $ 4,233 | $ 1,307 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2019Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Segment Information - Summary o
Segment Information - Summary of Reportable Operating Segment (Details) | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)Segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 01, 2019USD ($) | Dec. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | |||||||||||||
Operating income (loss) | $ 307,706,000 | $ 177,663,000 | $ 211,565,000 | ||||||||||
Interest expense, other, net | (52,953,000) | (54,059,000) | (52,524,000) | ||||||||||
Other income (expense), net | (6,589,000) | 106,000 | (14,522,000) | ||||||||||
Income (loss) from continuing operations before taxes | 199,645,000 | 75,312,000 | 108,124,000 | ||||||||||
Segment Schedule Footnotes | |||||||||||||
Asset impairment charges | $ 17,700,000 | $ 1,900,000 | $ 15,600,000 | $ 10,300,000 | $ 3,600,000 | 20,768,000 | 29,514,000 | 9,394,000 | |||||
Storm-related physical damage | $ 1,200,000 | 3,100,000 | |||||||||||
Executive transition costs | 1,600,000 | 6,300,000 | 1,600,000 | 1,300,000 | |||||||||
Nonrecurring Compensation Expense | 6,300,000 | 23,300,000 | 9,200,000 | 32,500,000 | |||||||||
Gain (Loss) on Extinguishment of Debt | (7,200,000) | 6,690,000 | 0 | 14,607,000 | |||||||||
Total floor plan interest expense | 48,519,000 | 48,398,000 | 36,395,000 | ||||||||||
Depreciation, Depletion and Amortization, Nonproduction | 93,169,000 | 93,623,000 | 88,944,000 | ||||||||||
Total assets | 4,071,035,000 | 3,796,807,000 | 4,071,035,000 | 3,796,807,000 | |||||||||
Cash and cash equivalents | 29,103,000 | 5,854,000 | 29,103,000 | 5,854,000 | 6,352,000 | $ 3,108,000 | |||||||
Goodwill | 475,791,000 | 509,592,000 | 475,791,000 | 509,592,000 | 525,780,000 | ||||||||
Intangible Assets, Net (Excluding Goodwill) | 64,300,000 | 69,705,000 | $ 64,300,000 | 69,705,000 | $ 65,700,000 | ||||||||
Number of operating segments | Segment | 2 | ||||||||||||
Segment Income | $ 220,413,000 | 104,826,000 | 117,518,000 | ||||||||||
EchoPark Segment Income | 9,146,000 | (52,587,000) | (20,950,000) | ||||||||||
Segment Retail Units Sold | |||||||||||||
Franchised Dealerships New Vehicle Revenue | 4,889,171 | 4,974,097 | 5,295,051 | ||||||||||
Franchised Dealerships Used Vehicle Revenue | 2,493,467 | 2,370,799 | 2,406,407 | ||||||||||
Franchised Dealerships Wholesale Revenue | 180,020 | 197,184 | 161,581 | ||||||||||
Franchised Dealerships Fixed Ops Revenue | 1,366,550 | 1,364,559 | 1,401,802 | ||||||||||
Franchised Dealerships F&I Revenue | 363,117 | 344,814 | 348,058 | ||||||||||
Franchised Dealerships Segment Revenue | 9,292,325 | 9,251,453 | 9,612,899 | ||||||||||
Revenues | $ 2,748,404,000 | $ 2,702,720,000 | $ 2,614,081,000 | $ 2,389,138,000 | $ 2,574,259,000 | $ 2,470,849,000 | $ 2,505,749,000 | $ 2,400,773,000 | |||||
EchoPark Used Vehicle Revenue | 996,504 | 602,698 | 215,646 | ||||||||||
EchoPark Wholesale Revenue | 22,927 | 20,443 | 9,483 | ||||||||||
EchoPark Fixed Ops Revenue | 28,753 | 16,327 | 14,208 | ||||||||||
EchoPark F&I Revenue | 113,834 | 60,709 | 14,972 | ||||||||||
EchoPark Segment Revenue | 1,162,018 | 700,177 | 254,309 | ||||||||||
EchoPark Total Impairment [Member] | |||||||||||||
Segment Schedule Footnotes | |||||||||||||
Asset impairment charges | 19,667,000 | 1,582,000 | 1,903,000 | ||||||||||
Franchised Dealership Impairment [Member] | |||||||||||||
Segment Schedule Footnotes | |||||||||||||
Asset impairment charges | $ 1,101,000 | $ 27,932,000 | $ 7,491,000 |
Summary of Quarterly Financia_2
Summary of Quarterly Financial Data (Unaudited) - Consolidated Statements of Income by Quarter (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 01, 2018 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||
Total revenues | $ 2,748,404 | $ 2,702,720 | $ 2,614,081 | $ 2,389,138 | $ 2,574,259 | $ 2,470,849 | $ 2,505,749 | $ 2,400,773 | ||||
Gross profit | 393,884 | 386,811 | 381,311 | 359,011 | 370,715 | 360,536 | 362,375 | 352,499 | $ 1,521,017 | $ 1,446,125 | $ 1,457,676 | |
Net income (loss) | $ 144,137 | $ 46,307 | $ 29,010 | $ 26,599 | $ 42,221 | $ 21,821 | $ 15,118 | $ 16,905 | $ (2,194) | $ 144,137 | $ 51,650 | $ 92,983 |
Earnings (loss) per common share - Basic (usd per share) | $ 1.07 | $ 0.67 | $ 0.62 | $ 0.98 | $ 0.51 | $ 0.35 | $ 0.40 | $ (0.05) | $ 3.35 | $ 1.21 | $ 2.11 | |
Earnings (loss) per common share - Diluted (usd per share) | $ 1.04 | $ 0.66 | $ 0.61 | $ 0.98 | $ 0.51 | $ 0.35 | $ 0.39 | $ (0.05) | $ 3.30 | $ 1.20 | $ 2.09 | |
Lease exit accrual adjustments and charges | $ 2,600 | $ 4,800 | ||||||||||
Executive transition costs | $ 1,600 | $ 6,300 | $ 1,600 | $ 1,300 |
Summary of Quarterly Financia_3
Summary of Quarterly Financial Data (Unaudited) - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Condensed Unaudited Quarterly Financial Data [Line Items] | |||||||||
Asset impairment charges | $ 17,700,000 | $ 1,900,000 | $ 15,600,000 | $ 10,300,000 | $ 3,600,000 | $ 20,768,000 | $ 29,514,000 | $ 9,394,000 | |
Lease exit accrual adjustments and charges | 2,600,000 | 4,800,000 | |||||||
Executive transition costs | $ 1,600,000 | 6,300,000 | 1,600,000 | 1,300,000 | |||||
Storm-related physical damage | 1,200,000 | 3,100,000 | |||||||
Long-term compensation costs | $ 6,300,000 | 23,300,000 | 9,200,000 | 32,500,000 | |||||
Tax benefit related to deferred income tax impact of change in U.S. federal tax income rate | 28,400,000 | ||||||||
Pre-tax charge related to the extinguishment of debt | 7,200,000 | $ (6,690,000) | $ 0 | $ (14,607,000) | |||||
Net benefit from legal settlements | 1,500,000 | ||||||||
7.0% Senior Subordinated Notes Expired | |||||||||
Condensed Unaudited Quarterly Financial Data [Line Items] | |||||||||
Stated interest rate on debt agreement | 5.00% | ||||||||
Franchised dealerships | |||||||||
Condensed Unaudited Quarterly Financial Data [Line Items] | |||||||||
Lease exit accrual adjustments and charges | $ 800,000 | ||||||||
Pre-tax gain (loss) on disposal | 29,300,000 | $ 46,700,000 | 300,000 | 38,000,000 | 1,200,000 | ||||
Gain (loss) on disposal of dealerships (1) | $ 29,300,000 | $ 46,700,000 | $ 300,000 | $ 38,000,000 | $ 1,200,000 |
Leases, Codification Topic 84_2
Leases, Codification Topic 842 (Details) - USD ($) $ in Thousands | Jan. 01, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2018 |
Leases [Abstract] | |||||
Finance Lease, Right-of-Use Asset | $ 18,948 | $ 34,691 | $ 0 | ||
ROU assets | 387,970 | 337,842 | 0 | ||
Operating lease liabilities | 419,500 | 347,483 | |||
Finance Lease, Liability | 20,600 | 37,877 | |||
Right of Use Assets Total | 406,918 | 372,533 | |||
Lease Right of Use Asset New Lease Total | 10,202 | ||||
Finance Lease, Right-of-Use Asset, New Leases | 121 | ||||
Operating Lease, Right-of-Use Asset, New Leases | 10,081 | ||||
Finance Lease, Liability, Current, New Leases | 12 | ||||
Operating Lease, Liability, Current, New Leases | 1,560 | ||||
Lease Liability Current New Lease Total | 1,572 | ||||
Finance Lease, Liability, Noncurrent, New Leases | 109 | ||||
Operating Lease, Liability, Noncurrent, New Leases | 8,521 | ||||
Lease Liability Noncurrent New Lease Total | 8,630 | ||||
Finance Lease, Right-of-Use Asset, Modifications | 18,835 | ||||
Operating Lease, Right-of-Use Asset, Modifications | (15,205) | ||||
Lease Right of Use Asset Modifications Total | 3,630 | ||||
Lease Right of Use Asset Amortization Total | 48,217 | ||||
Finance Lease, Liability, Current, Modifications | 4,513 | ||||
Operating Lease, Liability, Current, Modifications | (2,650) | ||||
Lease, Liability Current, Modifications Total | 1,863 | ||||
Finance Lease, Liability, Noncurrent, Modifications | 17,867 | ||||
Operating Lease, Liability, Noncurrent, Modifications | (12,400) | ||||
Lease, Liability Noncurrent, Modifications Total | 5,467 | ||||
Finance Lease, Right-of-Use Asset, Amortization | 5,181 | 0 | $ 0 | ||
Operating Lease, Right-of-Use Asset, Amortization | 45,004 | ||||
Finance Lease, Liability, Current, Amortization | 3,689 | ||||
Operating Lease, Liability, Current, Amortization | 3,682 | ||||
Lease, Liability, Current, Amortization Total | 7,371 | ||||
Finance Lease, Liability, Noncurrent, Amortization | 1,492 | ||||
Operating Lease, Liability, Noncurrent, Amortization | 42,788 | ||||
Lease, Liability Noncurrent, Amortization Total | (44,280) | ||||
Finance Lease, Liability, Current | 728 | 1,564 | 0 | ||
Operating Lease, Liability, Current | 48,104 | 43,332 | 0 | ||
Lease Liability Current Total | 48,832 | 44,896 | |||
Finance Lease, Liability, Noncurrent | 19,829 | 36,313 | 0 | ||
Operating Lease, Liability, Noncurrent | 350,818 | 304,151 | 0 | ||
Lease Liability Noncurrent Total | 370,647 | 340,464 | |||
Lease Exit Accruals | 0 | 4,634 | |||
Lessee, Lease, Description [Line Items] | |||||
Retained earnings | 663,263 | 790,158 | 670,691 | $ 629,274 | |
Property, Plant and Equipment, Net | 1,159,541 | 1,097,247 | 1,178,489 | ||
Intangible Assets, Net (Excluding Goodwill) | 65,700 | 64,300 | 69,705 | ||
Leases, Right-of-Use Asset | 406,900 | ||||
Lease, Liability, Current | 48,832 | 0 | |||
Other Liabilities, Current | 255,836 | 266,211 | 257,823 | $ 239,249 | |
Lease, Right-of-Use Asset | 406,918 | 0 | |||
Long-Term Debt | 898,222 | 636,978 | 918,779 | ||
Lease, Liability, Noncurrent | 370,647 | 0 | |||
Other Liabilities, Noncurrent | 73,379 | 73,746 | 75,887 | ||
Deferred Income Taxes | 30,144 | $ 8,927 | $ 33,178 | ||
7428000 | |||||
Lessee, Lease, Description [Line Items] | |||||
Operating Lease, Impairment Loss | 10,500 | ||||
Retained earnings | (7,428) | ||||
Property, Plant and Equipment, Net | (18,948) | ||||
Intangible Assets, Net (Excluding Goodwill) | (4,005) | ||||
Lease, Liability, Current | 48,832 | ||||
Other Liabilities, Current | (1,987) | ||||
Lease, Right-of-Use Asset | 406,918 | ||||
Long-Term Debt | (20,557) | ||||
Lease, Liability, Noncurrent | 370,647 | ||||
Other Liabilities, Noncurrent | (2,508) | ||||
Deferred Income Taxes | $ (3,034) |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)store | Dec. 31, 2018USD ($)store | Dec. 31, 2017USD ($) | |
Subsequent Event [Line Items] | |||
Number of franchises disposed | store | 1 | 2 | |
Cash generated from disposition | $ | $ 250.7 | $ 128.7 | $ 38.2 |