Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 28, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-31262 | ||
Entity Registrant Name | ASBURY AUTOMOTIVE GROUP, INC | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 01-0609375 | ||
Entity Address, Address Line One | 2905 Premiere Parkway NW, | ||
Entity Address, Address Line Two | Suite 300 | ||
Entity Address, City or Town | Duluth, | ||
Entity Address, State or Province | GA | ||
Entity Address, Postal Zip Code | 30097 | ||
City Area Code | 770 | ||
Local Phone Number | 418-8200 | ||
Title of 12(b) Security | Common stock, $0.01 par value per share | ||
Trading Symbol | ABG | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
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 | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3,280 | ||
Entity Common Stock, Shares Outstanding | 23,187,817 | ||
Documents Incorporated by Reference | List hereunder the following documents if incorporated by reference and the Part of the Form 10-K into which the document is incorporated: Portions of the registrant's definitive Proxy Statement for the 2022 Annual Meeting of Stockholders, to be filed within 120 days after the end of the registrant's fiscal year, are incorporated by reference into Part III, Items 10 through 14 of this Annual Report on Form 10-K. | ||
Entity Central Index Key | 0001144980 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Audit Information [Abstract] | |
Auditor Name | Ernst & Young LLP |
Auditor Location | Atlanta, Georgia |
Auditor Firm ID | 42 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 178.9 | $ 1.4 |
Short-term Investments | 11 | 0 |
Contracts-in-transit, net | 212.5 | 161.5 |
Accounts receivable, net | 229.8 | 155.5 |
Inventories, net | 718.4 | 875.2 |
Assets held for sale | 375.1 | 28.3 |
Other current assets | 203.7 | 183.8 |
Total current assets | 1,929.4 | 1,405.7 |
INVESTMENTS | 123.5 | 0 |
PROPERTY AND EQUIPMENT, net | 1,990 | 956.2 |
OPERATING LEASE RIGHT-OF-USE ASSETS | 261 | 317.4 |
GOODWILL | 2,271.7 | 562.2 |
INTANGIBLE FRANCHISE RIGHTS | 1,335.7 | 425.2 |
DEFERRED INCOME TAXES, net of current portion | 69.1 | 0 |
OTHER LONG-TERM ASSETS | 22.2 | 9.6 |
Total assets | 8,002.6 | 3,676.3 |
CURRENT LIABILITIES: | ||
Floor plan notes payable—trade, net | 37.3 | 64.9 |
Floor plan notes payable—non-trade, net | 527.2 | 637.3 |
Current maturities of long-term debt | 62.5 | 36.6 |
Current maturities of operating leases | 25.8 | 24.8 |
Accounts payable and accrued liabilities | 742.9 | 450.9 |
Deferred revenue—current | 181.5 | 0 |
Liabilities associated with assets held for sale | 20.8 | 8.9 |
Total current liabilities | 1,598 | 1,223.4 |
LONG-TERM DEBT | 3,520.1 | 1,165.2 |
LONG-TERM LEASE LIABILITY | 242 | 296.7 |
Contract with Customer, Liability, Noncurrent | 466.3 | 0 |
DEFERRED INCOME TAXES | 0 | 34.6 |
OTHER LONG-TERM LIABILITIES | 60.7 | 50.9 |
COMMITMENTS AND CONTINGENCIES (Note 21) | ||
SHAREHOLDERS' EQUITY: | ||
Preferred stock, $.01 par value, 10,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock, $.01 par value, 90,000,000 shares authorized; 45,052,293 and 41,133,668 shares issued, including shares held in treasury, respectively | 0.4 | 0.4 |
Additional paid-in capital | 1,278.6 | 595.5 |
Retained earnings | 1,881.3 | 1,348.9 |
Treasury stock, at cost; 21,914,251 and 21,848,314 shares, respectively | (1,044.1) | (1,033.7) |
Accumulated other comprehensive loss | (0.7) | (5.6) |
Total shareholders' equity | 2,115.5 | 905.5 |
Total liabilities and shareholders' equity | $ 8,002.6 | $ 3,676.3 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 90,000,000 | 90,000,000 |
Common stock, shares issued (in shares) | 45,052,293 | 41,133,668 |
Treasury stock, shares (in shares) | 21,914,251 | 21,848,314 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
REVENUE: | |||
Finance and insurance, net | $ 405.1 | $ 305.1 | $ 316 |
TOTAL REVENUE | 9,837.7 | 7,131.8 | 7,210.3 |
COST OF SALES: | |||
Finance and insurance | 3.6 | 0 | 0 |
TOTAL COST OF SALES | 7,935.5 | 5,908.4 | 6,041.4 |
GROSS PROFIT | 1,902.2 | 1,223.4 | 1,168.9 |
OPERATING EXPENSES: | |||
Selling, general, and administrative | 1,073.9 | 781.9 | 799.8 |
Depreciation and amortization | 41.9 | 38.5 | 36.2 |
Franchise rights impairment | 0 | 23 | 7.1 |
Other operating (income) expense, net | (5.4) | 9.2 | 0.8 |
INCOME FROM OPERATIONS | 791.8 | 370.8 | 325 |
OTHER EXPENSES (INCOME): | |||
Floor plan interest expense | 8.2 | 17.7 | 37.9 |
Other interest expense, net | 93.9 | 56.7 | 54.9 |
Loss on extinguishment of long-term debt, net | 0 | 20.6 | 0 |
Gain on dealership divestitures, net | (8) | (62.3) | (11.7) |
Total other expenses, net | 94.1 | 32.7 | 81.1 |
INCOME BEFORE INCOME TAXES | 697.7 | 338.1 | 243.9 |
Income tax expense | 165.3 | 83.7 | 59.5 |
NET INCOME | $ 532.4 | $ 254.4 | $ 184.4 |
Basic— | |||
Net income (in dollars per share) | $ 26.75 | $ 13.25 | $ 9.65 |
Diluted— | |||
Net income (in dollars per share) | $ 26.49 | $ 13.18 | $ 9.55 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||
Basic (in shares) | 19.9 | 19.2 | 19.1 |
Restricted stock (in shares) | 0.1 | 0 | 0.1 |
Performance share units (in shares) | 0.1 | 0.1 | 0.1 |
Diluted (in shares) | 20.1 | 19.3 | 19.3 |
New vehicle | |||
REVENUE: | |||
Revenue | $ 4,934.1 | $ 3,767.4 | $ 3,863.3 |
COST OF SALES: | |||
Parts and service | 4,443.6 | 3,548.9 | 3,703.8 |
Used vehicle | |||
REVENUE: | |||
Revenue | 3,315.6 | 2,169.5 | 2,131.6 |
COST OF SALES: | |||
Parts and service | 3,027.3 | 2,012.9 | 1,997.5 |
Parts and services | |||
REVENUE: | |||
Revenue | 1,182.9 | 889.8 | 899.4 |
COST OF SALES: | |||
Parts and service | $ 461 | $ 346.6 | $ 340.1 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 532.4 | $ 254.4 | $ 184.4 |
Other comprehensive income (loss): | |||
Change in fair value of cash flow swaps | 6.3 | (3.6) | (4.4) |
Unrealized gains on available-for-sale debt securities | 0.2 | 0 | 0 |
Income tax benefit (expense) associated with other comprehensive income items | (1.6) | 0.9 | 1.1 |
Comprehensive income | $ 537.3 | $ 251.7 | $ 181.1 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-in Capital | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss)Cumulative Effect, Period of Adoption, Adjustment |
Accounting Standards Update [Extensible List] | Accounting Standards Update 2018-02 [Member] | ||||||||
Balance (in shares) at Dec. 31, 2018 | 41,065,069 | 21,719,339 | |||||||
Balance at Dec. 31, 2018 | $ 473,200,000 | $ 0 | $ 400,000 | $ 572,900,000 | $ 922,700,000 | $ 200,000 | $ (1,023,400,000) | $ 600,000 | $ (200,000) |
Comprehensive Income (Loss): | |||||||||
Net income | 184,400,000 | 184,400,000 | |||||||
Unrealized gains on available-for-sale debt securities, net of $0 tax charge | 0 | ||||||||
Change in fair value of cash flow swaps, net of reclassification adjustment | (3,300,000) | (3,300,000) | |||||||
Comprehensive income | 181,100,000 | 184,400,000 | (3,300,000) | ||||||
Share-based compensation | 12,500,000 | 12,500,000 | |||||||
Issuance of common stock in connection with share-based payment arrangements (in shares) | 209,390 | ||||||||
Issuance of common stock, net of forfeitures, in connection with share-based payment arrangements | 0 | ||||||||
Repurchase of common stock associated with net share settlements of employee share-based awards (in shares) | 72,368 | ||||||||
Repurchase of common stock associated with net share settlements of employee share-based awards | (5,200,000) | $ (5,200,000) | |||||||
Purchase of treasury shares (in shares) | 202,379 | ||||||||
Purchase of treasury shares | (15,300,000) | $ (15,300,000) | |||||||
Retirement of previously repurchased common stock (in shares) | (202,379) | (202,379) | |||||||
Retirement of previously repurchased common stock | 0 | (2,500,000) | (12,800,000) | $ 15,300,000 | |||||
Balance (in shares) at Dec. 31, 2019 | 41,072,080 | 21,791,707 | |||||||
Balance at Dec. 31, 2019 | 646,300,000 | $ 400,000 | 582,900,000 | 1,094,500,000 | $ (1,028,600,000) | (2,900,000) | |||
Comprehensive Income (Loss): | |||||||||
Net income | 254,400,000 | 254,400,000 | |||||||
Unrealized gains on available-for-sale debt securities, net of $0 tax charge | 0 | ||||||||
Change in fair value of cash flow swaps, net of reclassification adjustment | (2,700,000) | (2,700,000) | |||||||
Comprehensive income | 251,700,000 | 254,400,000 | (2,700,000) | ||||||
Share-based compensation | 12,600,000 | 12,600,000 | |||||||
Issuance of common stock in connection with share-based payment arrangements (in shares) | 61,588 | ||||||||
Issuance of common stock, net of forfeitures, in connection with share-based payment arrangements | 0 | 0 | |||||||
Repurchase of common stock associated with net share settlements of employee share-based awards (in shares) | 56,607 | ||||||||
Repurchase of common stock associated with net share settlements of employee share-based awards | (5,100,000) | $ (5,100,000) | |||||||
Balance (in shares) at Dec. 31, 2020 | 41,133,668 | 21,848,314 | |||||||
Balance at Dec. 31, 2020 | 905,500,000 | $ 400,000 | 595,500,000 | 1,348,900,000 | $ (1,033,700,000) | (5,600,000) | |||
Comprehensive Income (Loss): | |||||||||
Net income | 532,400,000 | 532,400,000 | |||||||
Unrealized gains on available-for-sale debt securities, net of $0 tax charge | 200,000 | 200,000 | |||||||
Change in fair value of cash flow swaps, net of reclassification adjustment | 4,700,000 | 4,700,000 | |||||||
Comprehensive income | 537,300,000 | 532,400,000 | 4,900,000 | ||||||
Share-based compensation | 16,200,000 | 16,200,000 | |||||||
Proceeds from secondary offering of common stock, net (in shares) | 3,795,000 | ||||||||
Proceeds from secondary offering of common stock, net | 666,900,000 | 666,900,000 | |||||||
Issuance of common stock in connection with share-based payment arrangements (in shares) | 123,625 | ||||||||
Issuance of common stock, net of forfeitures, in connection with share-based payment arrangements | 0 | 0 | |||||||
Repurchase of common stock associated with net share settlements of employee share-based awards (in shares) | 65,937 | ||||||||
Repurchase of common stock associated with net share settlements of employee share-based awards | (10,400,000) | $ (10,400,000) | |||||||
Retirement of previously repurchased common stock | 0 | ||||||||
Balance (in shares) at Dec. 31, 2021 | 45,052,293 | 21,914,251 | |||||||
Balance at Dec. 31, 2021 | $ 2,115,500,000 | $ 400,000 | $ 1,278,600,000 | $ 1,881,300,000 | $ (1,044,100,000) | $ (700,000) |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Parenthetical) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | |||
Change in fair value of cash flow swaps, net of reclassification adjustment tax charge (benefit) | $ 1,600,000 | $ (900,000) | $ (1,100,000) |
Unrealized gains on available-for-sale debt securities, tax | $ 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOW FROM OPERATING ACTIVITIES: | |||
Net income | $ 532.4 | $ 254.4 | $ 184.4 |
Adjustments to reconcile net income to net cash provided by operating activities— | |||
Depreciation and amortization | 41.9 | 38.5 | 36.2 |
Share-based compensation | 16.2 | 12.6 | 12.5 |
Deferred income taxes | 31.2 | 9.5 | 5.4 |
Franchise rights impairment | 0 | 23 | 7.1 |
Unrealized gains on investments | (1) | 0 | 0 |
Loss on extinguishment of debt | 0 | 20.6 | 0 |
Loaner vehicle amortization | 20.9 | 21.8 | 23.6 |
Gain on divestitures | (8) | (62.3) | (11.7) |
Change in right-of-use asset | 22.3 | 21.5 | 19.4 |
Other adjustments, net | (0.8) | 1.3 | 4.8 |
Changes in operating assets and liabilities, net of acquisitions and divestitures— | |||
Contracts-in-transit | 48.5 | 33.2 | 3.6 |
Accounts receivable | 35.3 | (19.1) | (6) |
Inventories | 670.5 | 428 | 212.1 |
Other current assets | (227.1) | (183.3) | (173.7) |
Floor plan notes payable—trade, net | (27.6) | (64.5) | 38.2 |
Increase (Decrease) in Contract with Customer, Asset | 3.6 | 0 | 0 |
Accounts payable and accrued liabilities | 39.2 | 121 | 10.7 |
Operating lease liabilities | (20.6) | (20.9) | (19.7) |
Other long-term assets and liabilities, net | (13.2) | 17.2 | 2.9 |
Net cash provided by operating activities | 1,163.7 | 652.5 | 349.8 |
CASH FLOW FROM INVESTING ACTIVITIES: | |||
Capital expenditures—excluding real estate | (74.2) | (46.5) | (57.6) |
Capital expenditures—real estate | (7.8) | (2.3) | (9.2) |
Purchases of previously leased real estate | (217.1) | 0 | (4.9) |
Acquisitions, net of cash acquired | (3,660.4) | (954.1) | (210) |
Divestitures | 21.3 | 177.9 | 39.1 |
Purchases of debt securities—available-for-sale | (1.1) | 0 | 0 |
Purchases of equity securities | (0.4) | 0 | 0 |
Proceeds from the sale of debt securities—available-for-sale | 0.8 | 0 | 0 |
Proceeds from the sale of equity securities | 0.4 | 0 | 0 |
Proceeds from the sale of assets | 21.5 | 4.2 | 15 |
Net cash used in investing activities | (3,917) | (820.8) | (227.6) |
CASH FLOW FROM FINANCING ACTIVITIES: | |||
Floor plan borrowings—non-trade | 5,042.8 | 4,312 | 4,318.6 |
Floor plan borrowings—acquisitions | 214.5 | 131.6 | 55.3 |
Floor plan repayments—non-trade | (5,357.5) | (4,467.3) | (4,513.3) |
Floor plan repayments—divestitures | (0.8) | (60.4) | (14.1) |
Proceeds from borrowings | 2,274 | 1,875.3 | 97.7 |
Repayments of borrowings | (41.5) | (1,622.5) | (48.4) |
Proceeds from revolving credit facility | 439 | 0 | 0 |
Repayments of revolving credit facility | (270) | 0 | 0 |
Sale and leaseback transaction | 0 | 7.3 | 0 |
Proceeds from issuance of common stock | 666.9 | 0 | 0 |
Payment of debt issuance costs | (26.2) | (4.7) | (2.3) |
Repurchases of common stock, including amounts associated with net share settlements of employee share-based awards | (10.4) | (5.1) | (20.5) |
Net cash provided by (used in) financing activities | 2,930.8 | 166.2 | (127) |
Net increase (decrease) in cash and cash equivalents | 177.5 | (2.1) | (4.8) |
CASH AND CASH EQUIVALENTS, beginning of period | 1.4 | 3.5 | 8.3 |
CASH AND CASH EQUIVALENTS, end of period | $ 178.9 | $ 1.4 | $ 3.5 |
DESCRIPTION OF BUSINESS AND SUM
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Asbury Automotive Group, Inc., a Delaware corporation organized in 2002, is one of the largest automotive retailers in the United States. Our store operations are conducted by our subsidiaries. As of December 31, 2021, we owned and operated 205 new vehicle franchises, representing 31 brands of automobiles at 155 dealership locations, 35 collision centers, seven stand-alone used vehicle dealerships, one used vehicle wholesale business and one auto auction within fifteen states. Our stores offer an extensive range of automotive products and services, including new and used vehicles; parts and service, which includes repair and maintenance services, replacement parts and collision repair services (collectively referred to as "parts and services" or "P&S"); and finance and insurance products ("F&I"), including arranging vehicle financing through third parties and aftermarket products, such as extended service contracts, guaranteed asset protection ("GAP") debt cancellation and prepaid maintenance. On December 17, 2021, the Company completed the acquisition of the Larry H. Miller Dealerships ("LHM"), thereby acquiring 54 new vehicle dealerships, seven used car stores, 11 collision centers, a used vehicle wholesale business, the real property related thereto, and the entities comprising the F&I product provider, Total Care Auto, Powered by Landcar ("TCA") for a total purchase price of $3.48 billion (the "LHM Acquisition"). The real property was acquired in escrow, to be released, together with the related portion of the purchase price, subject to the satisfaction of certain title related conditions. The purchase price was financed through a combination of cash, debt, including senior notes, real estate facilities, new and used vehicle floor plan facilities and the proceeds from the issuance of common stock. TCA offers extended vehicle service contracts, prepaid maintenance contracts, vehicle theft assistance contracts, key replacement contracts, guaranteed asset protection contracts, paintless dent repair contracts, appearance protection contracts, tire and wheel, DrivePur, and lease wear and tear contracts. In addition, TCA provides the required contractual liability insurance if needed. The majority of these service contracts are sold through affiliated automobile dealerships. As a result of acquiring the TCA as part of the LHM Acquisition, the Company now operates in two reportable segments, namely the Dealerships and TCA. On August 24, 2020 the Company closed on the purchase of the Park Place Dealership group, acquiring substantially all of the assets of and leasing the real property related to, 12 franchises (eight dealership locations), two collision centers and an auto auction for a purchase price of $889.9 million (the "Park Place Acquisition"). The purchase price was financed through a combination of cash, debt and seller financing. Certain of the leased real property was subsequently acquired in May 2021 for $217.1 million. See Note 3 "Acquisitions and Divestitures" for details of the LHM Acquisition and the Park Place Acquisition. Our operating results are generally subject to seasonal variations. Demand for new vehicles is generally highest during the second, third, and fourth quarters of each year and, accordingly, we expect our revenues to generally be higher during these periods. In addition, we typically experience higher sales of luxury vehicles in the fourth quarter, which have higher average selling prices and gross profit per vehicle retailed. Revenues and operating results may be impacted significantly from quarter to quarter by changing economic conditions, inventory availability, vehicle manufacturer incentive programs, or adverse weather events. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and reflect the consolidated accounts of Asbury Automotive Group, Inc. and our wholly owned subsidiaries. All intercompany transactions have been eliminated in consolidation. If necessary, reclassifications of amounts previously reported have been made to the accompanying Consolidated Financial Statements in order to conform to current presentation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the periods presented. Actual results could differ materially from these estimates. Estimates and assumptions are reviewed quarterly, and the effects of any revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant estimates made in the accompanying Consolidated Financial Statements include, but are not limited to, those relating to inventory valuation reserves, reserves for chargebacks against revenue recognized from the sale of finance and insurance products, reserves for self-insurance programs, certain assumptions related to intangible and long-lived assets, and reserves for certain legal or similar proceedings relating to our business operations. Cash and Cash Equivalents Cash and cash equivalents include investments in money market accounts and short-term certificates of deposit, which have maturity dates of less than 90 days when purchased. Restricted Cash and Securities TCA places securities on statutory deposit with certain state agencies to retain the right to do business in those states. Securities held on deposit with various state regulatory authorities had a fair value of $2.5 million at December 31, 2021. Short-Term Investments Short-term investments consist of debt securities that are callable or have a maturity date within the next 12 months and are classified as current assets. Debt securities classified as short-term investments are designated as available-for-sale as management intends to hold these securities for indefinite periods of time or may sell the securities in response to changes in interest rates, prepayments, or other similar factors. Available-for-sale debt securities are reported at fair market value with any unrealized gain or loss, net of applicable income tax, reported in other comprehensive income, as a separate component of shareholders’ equity. Premiums and discounts on debt securities classified as short-term investments are amortized or accreted using the effective interest method over the period from the purchase date to the expected maturity or call date of the related security and are reported in net income. Investments Investments consist of available-for-sale debt securities, equity securities, and other investments. These securities are classified as non-current investments as they are not intended to fund current operations or have stated call dates or maturity dates beyond the next 12 months. Equity securities may consist of both preferred stock and common stock. Other investments consist of hedge funds and partnerships. Debt securities classified as non-current investments are designated as available-for-sale as management intends to hold these securities for indefinite periods of time or may sell the securities in response to changes in interest rates, prepayments, or other similar factors. Available-for-sale debt securities included in non-current investments are reported at fair market value with any unrealized gain or loss, net of applicable income tax, reported in other comprehensive income, as a separate component of shareholders’ equity. Premiums and discounts on debt securities included in non-current investments are amortized or accreted, as applicable, using the effective interest method over the period from the purchase date to the expected maturity or call date of the related security and are reported in net income. Equity securities included in non-current investments are reported at fair market value with the change in value recognized in net income. Other investments are measured at net asset value as a practical expedient with the net change in net asset value recognized in net income. We review the debt securities portfolio at the security level on a quarterly basis for potential credit losses, which takes into consideration numerous factors. Some factors evaluated include changes in credit ratings, financial conditions of the issuer, recent payment activity, and other industry specific economic conditions. If a security is considered to have a potential credit loss, we compare the present value of expected cash flows to the amortized cost basis of the security to estimate the allowance for credit losses. The amount of the allowance is limited to the gross unrealized loss on an individual security. An unrealized loss on a debt security is generally considered to not be related to credit when the fair value of the security is below the carrying value of the security primarily due to changes in risk-free interest rates and when there has not been a significant deterioration in the financial condition of the issuer. If the Company no longer has the intent or ability to hold a security in an unrealized loss position until recovery of the of the security’s cost basis, a loss is realized immediately in net income. Contracts-In-Transit Contracts-in-transit represent receivables from third-party finance companies for the portion of new and used vehicle purchase price financed by customers through sources arranged by us. Inventories Inventories are stated at the lower of cost and net realizable value. We use the specific identification method to value vehicle inventories and parts and accessories are valued at the lower of cost or net realizable value. Our new vehicle sales history indicates that the vast majority of the new vehicles we sell are sold for, or in excess of, our cost to purchase those vehicles. Therefore, we generally do not maintain a reserve for new vehicle inventory. We maintain a reserve for used vehicle inventory where cost basis exceeds net realizable value. In assessing lower of cost and net realizable value for used vehicles, we consider (i) the aging of our used vehicles, (ii) historical sales experience of used vehicles, and (iii) current market conditions and trends in used vehicle sales. We also review and consider the following metrics related to used vehicle sales (both on a recent and longer-term historical basis): (i) days of supply in our used vehicle inventory, (ii) used vehicle units sold at less than original cost as a percentage of total used vehicles sold, and (iii) average vehicle selling price of used vehicle units sold at less than original cost. We then determine the appropriate level of reserve required to reduce our used vehicle inventory to the lower of cost and net realizable value, and record the resulting adjustment in the period in which we determine a loss has occurred. The level of reserve determined to be appropriate for each reporting period is considered to be a permanent inventory write-down, and therefore is only released upon the sale of the related inventory. We receive assistance from certain automobile manufacturers in the form of advertising and floor plan interest credits. Manufacturer advertising credits that are reimbursements of costs associated with specific advertising programs are recognized as a reduction of advertising expense in the period they are earned. All other manufacturer advertising and floor plan interest credits are accounted for as purchase discounts, and are recorded as a reduction of inventory and recognized as a reduction to New vehicle cost of sales in the accompanying Consolidated Statements of Income in the period the related vehicle is sold. Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives. Depreciation is included in Depreciation and amortization on the accompanying Consolidated Statements of Income. Leasehold improvements are capitalized and amortized over the lesser of the remaining lease term or the useful life of the related asset. The ranges of estimated useful lives are as follows (in years): Buildings and improvements 10-40 Machinery and equipment 5-10 Furniture and fixtures 3-10 Company vehicles 3-5 Expenditures for major additions or improvements, which extend the useful lives of assets, are capitalized. Minor replacements, maintenance and repairs, which do not improve or extend the lives of such assets, are expensed as incurred. We capitalize interest on borrowings during the active construction period of capital projects. Capitalized interest is added to the cost of the assets and is depreciated over the estimated useful lives of the assets. We review property and equipment for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable. When we test our long-lived assets for impairment, we first compare the carrying amount of the underlying assets to their net recoverable value by reviewing the undiscounted cash flows expected from the use and eventual disposition of the underlying assets. If the carrying amount of the underlying assets is less than their net recoverable value, then we calculate an impairment equal to the excess of the carrying amount over the fair market value, and the impairment loss would be charged to operations in the period identified. During the year ended December 31, 2020, we recorded a $0.7 million impairment related to a vacant property. We did not record an impairment of our property and equipment in 2021 and 2019. Acquisitions Acquisitions are accounted for under the acquisition method of accounting and the assets acquired and liabilities assumed are recorded at their fair value at the acquisition date. The results of operations of acquired dealerships and other businesses are included in the accompanying Consolidated Statements of Income, commencing on the date of acquisition. Goodwill and Franchise Rights Goodwill represents the excess cost of an acquired business over the estimated fair market value of its identifiable net assets. We have determined that, based on how we integrate acquisitions into our business, how the components of our business share resources and interact with one another, and how we review the results of our operations, that we have several geographic market-based operating segments which consist of our dealerships. We have determined that the dealerships in each of our operating segments are components that are aggregated into several geographic market-based reporting units for the purpose of testing goodwill for impairment, as they (i) have similar economic characteristics, (ii) offer similar products and services (all of our dealerships offer new and used vehicles, service, parts and third-party finance and insurance products), (iii) have similar customers, (iv) have similar distribution and marketing practices (all of our dealerships distribute products and services through dealership facilities that market to customers in similar ways), and (v) operate under similar regulatory environments. Our dealership operating segments are aggregated into our single dealerships reportable segment. Goodwill associated with TCA will be tested annually for impairment at the operating segment level which is the same as the reporting unit for this business. In December 2021, we completed the LHM Acquisition which included 54 new vehicle dealerships, seven used car stores, 11 collision centers, a used vehicle wholesale business, the real property related thereto (Dealerships segment), and the entities comprising TCA. We have determined that the operations of TCA comprise a separate operating and reportable segment to that of our dealerships operations and have therefore allocated goodwill of $1.64 billion associated with the LHM Acquisition to each of our reportable segments. Approximately $710.3 million of goodwill was allocated to the TCA segment and $929.0 million was allocated to the Dealerships segment. This allocation is preliminary and subject to change once the purchase price allocation is finalized. The fair value of our manufacturer franchise rights are determined as of the acquisition date, by discounting the projected cash flows specific to each franchise. We have determined that manufacturer franchise rights have an indefinite life, as there are no economic, contractual or other factors that limit their useful lives, and they are expected to generate cash flows indefinitely due to the historically long lives of the manufacturers' brand names. Furthermore, to the extent that any agreements evidencing our manufacturer franchise rights would expire, we expect that we would be able to renew those agreements in the ordinary course of business. Goodwill and manufacturer franchise rights are deemed to have indefinite lives and therefore are not subject to amortization. We review goodwill and manufacturer franchise rights for impairment annually as of October 1 st , or more often if events or circumstances indicate that impairment may have occurred. We are subject to financial statement risk to the extent that goodwill becomes impaired due to decreases in the fair value of our automotive retail business or manufacturer franchise rights become impaired due to decreases in the fair value of our individual franchises. Our identifiable intangible assets, other than goodwill, are our rights under franchise agreements with manufacturers, which are recorded at an individual franchise level, and the value of business acquired ("VOBA") which is recorded at the TCA operating unit level. We recorded VOBA of $5.6 million in connection with the acquisition of TCA. VOBA reflects the estimated fair value of the expected future profits in unearned premium for in-force service contracts acquired in the LHM Acquisition. VOBA is based on actuarially determined projections, by each type of service contract, of future charges, premiums, claims, operating expenses, investment returns and other factors. VOBA is reflected in Other long-term assets within the Consolidated Balance Sheets and is amortized over the period of the underlying contracts. Debt Issuance Costs Debt issuance costs are presented as a contra-liability within Current maturities of long-term debt or Long-term debt on our Consolidated Balance Sheets, except for debt issuance costs associated with our line-of-credit arrangements, which are presented as an asset within Other current assets or Other long-term assets on our Consolidated Balance Sheets. Debt issuance costs are amortized to Floor plan interest expense and Other interest expense, net in the accompanying Consolidated Statements of Income through maturity using the effective interest method or the straight-line method for our line-of-credit arrangements. Derivative Instruments and Hedging Activities From time to time, we utilize derivative financial instruments to manage our interest rate risk. The types of risks hedged are those relating to the variability of cash flows caused by fluctuations in interest rates. We document our risk management strategy and assess hedge effectiveness at each interest rate swap's inception and during the term of each hedge. Derivatives are reported at fair value on the accompanying Consolidated Balance Sheets. The changes in fair value on our hedges is reported as a component of Accumulated Other Comprehensive Loss on the accompanying Consolidated Balance Sheets, and reclassified to Other interest expense, net in the accompanying Consolidated Statements of Income in the period during which the hedged transaction affects earnings. Self-insurance Programs We are self-insured for employee medical claims and maintain stop-loss insurance for large-dollar individual claims. We have high deductible insurance programs for workers compensation, property and general liability claims. We maintain and review our claim and loss history to assist in assessing our expected future liability for these claims. We also use professional service providers, such as account administrators and actuaries, to help us accumulate and assess this information. Provisions for retained losses and deductibles are made by charges to expense based upon periodic evaluations of the estimated ultimate liabilities on reported and unreported claims. Revenue Recognition We recognize revenue in accordance with ASC 606, Revenue from Contracts with Customers (Topic 606). Under that guidance, the transaction price is attributed to the underlying performance obligations in the contract and revenue is deferred and recognized as income as the Company satisfies the performance obligations in the contract and as the obligations under the contracts are performed. Incremental costs of obtaining a contract are capitalized and amortized to the extent that the Company expects to recover those costs. The Company satisfies performance obligations either over time or at a point in time as discussed in further detail below. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised good or performing a service to a customer. Sales and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. New vehicle and used vehicle retail Revenue from the sale of new and used vehicles is recognized when the terms of the customer contract are satisfied which generally occurs with the signing of the sales contract and transfer of control of the vehicle to the customer. Payment is generally received at the time of sale or from a third-party financial institution within a short period of time following the sale of the vehicle. Amounts due from third-party financial institutions are reflected in Contracts-in-transit or vehicle receivables within Accounts receivable, net on our Consolidated Balance Sheets. Costs associated with incidental items that are immaterial in the context of the contract are accrued at the time of sale. Used vehicle wholesale Proceeds from the sale of these vehicles are recognized in used vehicle revenue upon transfer of control to end-users at auction. Sale of vehicle parts and accessories The Company recognizes revenue upon transfer of control to the customer which occurs at a point in time. Payment is typically received when control of the parts and accessories transfers to the customer or within 30 days of such time. When the Company performs shipping and handling activities after the transfer of control to the customer (e.g., when control transfers prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued when the related revenue is recognized. Vehicle repair and maintenance services The Company provides vehicle repair and maintenance services to its customers pursuant to the terms and conditions included within the customer contract ("repair order"). Payment for services are typically received upon completion of the services or within 30 days following the completion of the services. Certain of these services are provided by the Dealerships segment to TCA customers in connection with claims related to TCA's vehicle protection products. Revenues recorded by the Dealerships segment and the associated claims expenses recorded by the TCA segment are eliminated upon consolidation. Satisfaction of this performance obligation creates an asset with no alternative use for which an enforceable right to payment for performance to date exists within our contractual agreements. As such, the Company recognizes revenue over time as the Company satisfies its performance obligation. Additionally, the Company has determined that parts and labor are not individually distinct in the context of a repair order and therefore treated as a single performance obligation. Finance and insurance, net Within the Dealership segment, we receive commissions from third-party lending and insurance institutions for arranging customer financing and from the sale of vehicle service contracts, guaranteed asset protection debt cancellation, and other products, to end-users. In addition, we record commissions received from our TCA segment related to the sale of TCA's various vehicle protection F&I products. Finance and insurance commission revenue is recognized at the point of sale since our performance obligation is to arrange financing or facilitating the sale of a third party's products or services to our customers. The dealerships commission arrangements with TCA, third-party lenders and insurance administrators consists of fixed ("upfront") and variable consideration. Variable consideration includes commission chargebacks ("chargebacks") in the event a contract is prepaid, defaulted upon, or terminated by the end-user. The Company reserves for future chargebacks based on historical chargeback experience and the termination provisions of the applicable contract, and these reserves are established in the same period that the related revenue is recognized. Commissions revenue and related reserves for future chargebacks in connection with the sale of TCA F&I products by our dealerships, are eliminated in consolidation. We also participate in future profits pursuant to retrospective commission arrangements, which meet the definition of variable consideration, for certain insurance products associated with a third-party portfolio. The Company estimates the amount of variable consideration to be included in the transaction price based on historical payment trends and further constrains the variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur. In making these assessments the Company considers the likelihood and magnitude of a potential reversal of revenue and updates its assessment when uncertainties associated with the constraint are removed. Within our TCA segment, all revenue other than investment and interest income is the result of contracts with customers. Each contract is considered to have a single performance obligation which extends over the life of the contract. Revenue is recognized over the contract term in proportion to the amount of insurance protection provided. Expenses are matched with earned premiums resulting in recognition of profits over the life of the contracts. These expenses include the incremental costs incurred, primarily in the form of commissions, to obtain the contracts with customers. These commissions are primarily paid to affiliated dealerships and are therefore eliminated upon consolidation. Unearned premium reserves are established to cover the unexpired portion of premiums written. Deferred Revenue We earn and recognize premium revenue related to the TCA segment over the period of the related service contract. Accordingly, we record deferred revenue as we ratably recognize revenue over the service contract period. Unpaid Losses and Loss Adjustment Expense Reserve Losses and loss adjustment expense reserves represent management's best estimate of the ultimate net cost of all reported and unreported losses incurred through December 31, 2021. The Company does not discount liabilities for unpaid losses or unpaid loss adjustment expense reserves. The reserves for unpaid losses and loss adjustment expenses are estimated using individual case-basis valuation and statistical analysis. Those estimates are subject to the effects of trends in loss severity and frequency. Although considerable variability is inherent in such estimates, management believes the reserves for losses and loss adjustment expenses are adequate. The estimates are continually reviewed and adjusted as necessary as experience develops or new information becomes known; such adjustments are included in income from operations. Claims are counted when incidents that may result in a liability are reported and are based on policy coverage. Internal Profit Revenues and expenses associated with internal work performed by our parts and service departments on new and used vehicle inventory are eliminated in consolidation. The gross profit earned by our parts and service departments for internal work performed is included as a reduction of Parts and service cost of sales on the accompanying Consolidated Statements of Income upon the sale of the vehicle. The costs incurred by our new and used vehicle departments for work performed by our parts and service departments is included in either New vehicle cost of sales or Used vehicle cost of sales on the accompanying Consolidated Statements of Income, depending on the classification of the vehicle serviced. We eliminate the internal profit on vehicles that remain in inventory. Intersegment Elimination TCA's vehicle protection products are sold primarily through affiliated dealerships and the revenue from the related commissions are included in F&I revenue in the Dealerships segment revenue before consolidation. The corresponding claims expense incurred and the amortization of deferred acquisition costs is recorded as a cost of sales in the TCA segment. The Dealerships segment also provides vehicle repair and maintenance services to TCA customers in connection with claims related to TCA's vehicle protection products. Revenues recorded by the Dealerships segment and the associated claims expenses recorded by the TCA segment are eliminated upon consolidation. Intersegment revenues and profits from contracts and services are eliminated in consolidation. See Note 20 "Segment Information" for further details . Share-Based Compensation We record share-based compensation expense under the fair value method on a straight-line basis over the vesting period, unless the awards are subject to performance conditions, in which case we recognize the expense over the requisite service period of each separate vesting tranche. In addition, we account for the forfeiture of share-based awards as they occur. Share Repurchases Share repurchases may be made from time-to-time in open market transactions or through privately negotiated transactions under the authorization approved by the Board of Directors. Periodically, the Company may retire repurchased shares of common stock previously held by the Company as treasury stock. In accordance with our accounting policy, we allocate any excess share repurchase price over par value between additional paid-in capital, which is limited to amounts initially recorded for the same issue, and retained earnings. The Company did not repurchase any shares under the Repurchase Program or retire any treasury shares during 2021 and 2020. Earnings per Common Share Basic earnings per common share is computed by dividing net income by the weighted-average common shares outstanding during the period. Diluted earnings per common share is computed by dividing net income by the weighted-average common shares and common share equivalents outstanding during the period. For all periods presented, there were no adjustments to the numerator necessary to compute diluted earnings per share. Advertising We expense costs of advertising as incurred and production costs when the advertising initially takes place, net of certain advertising credits and other discounts received from certain automobile manufacturers. Advertising expense totaled $30.7 million, $25.5 million and $34.4 million for the years ended December 31, 2021, 2020 and 2019, which was net of earned advertising credits of $22.4 million, $19.6 million, and $21.1 million, respectively, and is included in Selling, general, and administrative expense in the accompanying Consolidated Statements of Income. Income Taxes We use the liability method to account for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax basis using currently enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all the deferred tax assets will not be realized. Assets Held for Sale and Liabilities Associated with Assets Held for Sale Certain amounts have been classified as Assets held for sale as of December 31, 2021 and 2020 in the accom |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION Disaggregation of Revenue Revenue from contracts with customers consists of the following: For the year ended December 31, 2021 2020 2019 (In million) Revenue: New vehicle $ 4,934.1 $ 3,767.4 $ 3,863.3 Used vehicle retail 3,055.9 1,930.0 1,941.3 Used vehicle wholesale 259.7 239.5 190.3 New and used vehicle 8,249.7 5,936.9 5,994.9 Sale of vehicle parts and accessories 212.0 140.1 148.8 Vehicle repair and maintenance services 970.9 749.7 750.6 Parts and services 1,182.9 889.8 899.4 Finance and insurance, net 405.1 305.1 316.0 Total revenue $ 9,837.7 $ 7,131.8 $ 7,210.3 Contract Assets Changes in contract assets during the period are reflected in the table below. Contract assets related to vehicle repair and maintenance services are transferred to receivables when a repair order is completed and invoiced to the customer. Certain incremental sales commissions payable to obtain an F&I revenue contract with a customer have been capitalized and are amortized using the same pattern of recognition applicable to the associated F&I revenue contract. Vehicle Repair and Maintenance Services Finance and Insurance, net Deferred Sales Commissions Total (In millions) Contract Assets (Current), December 31, 2019 $ 4.8 $ 12.3 $ — $ 17.1 Transferred to receivables from contract assets recognized at the beginning of the period (4.8) (12.3) — (17.1) Increases related to revenue recognized, inclusive of adjustments to constraint, during the period 7.1 13.3 20.4 Contract Assets (Current), December 31, 2020 7.1 13.3 — 20.4 Transferred to receivables from contract assets recognized at the beginning of the period (7.1) (14.7) — (21.8) Increases related to revenue recognized, inclusive of adjustments to constraint, during the period 12.3 14.9 1.4 28.6 Contract Assets (Current), December 31, 2021 $ 12.3 $ 13.5 $ 1.4 $ 27.2 The Company acquired $644.3 million in Deferred revenue as part of the LHM Acquisition in December 2021. As of December 31, 2021, we had $647.8 million of Deferred revenue reflected in the Consolidated Balance Sheet. |
ACQUISITIONS AND DIVESTITURES
ACQUISITIONS AND DIVESTITURES | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND DIVESTITURES | ACQUISITIONS AND DIVESTITURESResults of acquired businesses, which are primarily dealerships, are included in our accompanying Consolidated Statements of Income commencing on the date of acquisition. Our acquisitions are accounted for such that the assets acquired and liabilities assumed are recognized at their acquisition date fair values, with any excess of the consideration transferred over the estimated fair values of the identifiable net assets acquired recorded as goodwill. Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Upon the completion of purchase accounting, the fair value of our manufacturer franchise rights are determined as of the acquisition date, by discounting the projected cash flows specific to each franchise. Included in this analysis are market participant assumptions related to the cash flows directly attributable to the franchise rights, including year-over-year and terminal growth rates, working capital requirements, weighted average cost of capital, future gross margins, and future selling, general, and administrative expenses. LHM Acquisition On December 17, 2021, we completed the acquisition of the equity interests of, and the real property related to the businesses of the Larry H. Miller Dealerships and the Total Care Auto, Powered by Landcar business. The acquisition diversifies Asbury's geographic mix, with entry into six Western states; Arizona, Utah, New Mexico, Idaho, California and Washington, and adds to the Company’s growing Colorado presence. As a result of the LHM Acquisition, we acquired 54 new vehicle dealerships, seven used car stores, 11 collision centers, a used vehicle wholesale business, the real property related thereto, and the entities comprising the TCA Business for a total purchase price of approximately $3.48 billion. The real property was acquired in escrow, to be released, together with the related portion of the preliminary purchase consideration, subject to the satisfaction of certain title related conditions. The preliminary purchase price was paid in cash. The sources of the preliminary purchase consideration are as follows: (In millions) Cash, net of cash acquired $ 195.0 Common stock offering 666.9 Senior notes 1,578.5 Real estate facility 513.0 New vehicle floor plan facility 183.5 Used vehicle floor plan facility 51.0 Payable to sellers 6.0 Preliminary purchase price, net of cash acquired $ 3,193.9 Under the acquisition method of accounting, the tangible and intangible assets acquired and liabilities assumed are recorded at their estimated fair value based on information currently available. The following table summarizes the amounts recorded based on preliminary estimates of fair value: (In millions) Summary of Assets Acquired and Liabilities Assumed Cash and cash equivalents $ 287.4 Investments 133.5 Contracts-in-transit, net 99.5 Accounts receivable, net 110.0 Inventories, net 285.0 Other current assets 25.4 Total current assets 940.8 Property and equipment, net 792.6 Goodwill 1,639.3 Intangible franchise rights 870.0 Operating lease right-of-use assets 34.1 Deferred income taxes 136.5 Other long-term assets 5.6 Total assets acquired 4,418.9 Accounts payable and accrued liabilities 234.0 Operating lease liabilities 34.1 Deferred revenue 644.3 Other long-term liabilities 25.2 Total liabilities assumed 937.6 Net assets acquired $ 3,481.3 The preliminary acquisition accounting is based upon the Company’s estimates of fair value. The estimated fair values of the assets acquired and liabilities assumed and the related preliminary acquisition accounting are based on management’s estimates and assumptions, as well as other information compiled by management, including the books and records of Larry H. Miller. Our estimates and assumptions are subject to change during the measurement period, not to exceed one year from the acquisition date. The areas of acquisition accounting that are not yet finalized primarily relate to the following significant items: (i) finalizing the review and valuation of land, land improvements, buildings and non-real property and equipment (including the models, key assumptions, estimates and inputs used) and assignment of remaining useful lives associated with the depreciable assets, (ii) finalizing the review and valuation of manufacturer franchise rights (including key assumptions, inputs and estimates), (iii) finalizing the review of the actuarial inputs to the value of business added intangible asset for TCA, (iv) finalizing the valuation of certain in-place contracts or contractual relationships (including but not limited to leases), including determining the appropriate amortization period, (v) finalizing our review of certain assets acquired and liabilities assumed, (vi) finalizing the evaluation and valuation of certain legal matters and/or other loss contingencies, including those that we may not yet be aware of but meet the requirement to qualify as a pre-acquisition contingency, and (vii) finalizing our estimate of the impact of acquisition accounting on deferred income taxes or liabilities. As the initial acquisition accounting is based on our preliminary assessments, actual values may differ (possibly materially) when final information becomes available that differs from our current estimates. Additionally, the total consideration transferred is subject to certain post-close adjustments. We believe that the information gathered to date provides a reasonable basis for estimating the preliminary fair values of assets acquired and liabilities assumed. We will continue to evaluate these items until they are satisfactorily resolved and adjust our acquisition accounting accordingly, within the allowable measurement period. The Company recorded $4.9 million of acquisition related costs during the year ended December 31, 2021. These costs are included in Selling, general, and administrative in the Consolidated Statements of Income. The Company's Consolidated Statements of Income included revenue and net income attributable to LHM from December 17, 2021 through December 31, 2021 of $256.4 million and $15.7 million, respectively. The following represents the unaudited pro forma information as if LHM had been included in the consolidated results of the Company since January 1, 2020: For the Year Ended December 31, 2021 2020 (In millions) (Unaudited) Pro forma revenue $ 15,431.5 $ 12,927.3 Pro forma net income $ 777.3 $ 359.9 This pro forma information incorporates the Company's accounting policies and adjusts the results of the LHM Acquisition for depreciation, rent expense, and interest expense assuming that the fair value adjustments and indebtedness incurred in connection with the LHM Acquisition had occurred on January 1, 2020. They have also been adjusted to reflect the $4.9 million of acquisition related costs incurred during 2021 as having occurred on January 1, 2020. Park Place Acquisition On December 11, 2019, we announced the proposed acquisition of substantially all of the assets of the businesses of the Park Place Dealership family of entities (collectively, "Park Place") pursuant to that certain Asset Purchase Agreement, dated as of December 11, 2019, among the Company, Park Place and the other parties thereto (the "2019 Asset Purchase Agreement"), and related agreements and transactions (collectively, the "2019 Acquisition"). On March 24, 2020, as a result of the uncertainties related to the COVID-19 pandemic we delivered notice to the sellers terminating the 2019 Acquisition pursuant to the terms of the related agreements and transactions in exchange for the payment of $10.0 million of liquidated damages which is reflected in our accompanying Consolidated Statements of Income as Other operating (income) expense, net. See Note 14 "Debt" for details related to the impact on certain financing arrangements as a result of terminating the 2019 Acquisition. On July 6, 2020, the Company, through two of its subsidiaries, entered into an Asset Purchase Agreement with certain members of the Park Place Dealership group, to acquire substantially all of the assets of, and lease the real property related to, 12 new vehicle dealership franchises (8 dealership locations), two collision centers and an auto auction (collectively, the "Park Place Acquisition"). The Park Place acquisition was completed on August 24, 2020 and financed through a combination of cash, floor plan facilities and seller financing. The seller financing comprised $150.0 million in aggregate principal amount of a 4.00% promissory note due August 2021 and $50.0 million in aggregate principal amount of a 4.00% promissory note due February 2022 (collectively, the "Seller Notes"). In September 2020, the Company redeemed the Seller Notes with proceeds from the offering of 4.50% Notes due 2028 and 4.75% Notes due 2030. See Note 14 "Debt" for further details. The sources of the purchase consideration are as follows: (In millions) Cash $ 527.4 Seller notes 200.0 New vehicle floor plan facility 127.5 Used vehicle floor plan facility 35.0 Purchase price $ 889.9 Under the acquisition method of accounting, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on information currently available. For the year ended December 31, 2021, we recorded a $1.5 million measurement period adjustment to Property and equipment and Goodwill, respectively. The following table summarizes the allocation of the purchase price: (In millions) Summary of Assets Acquired and Liabilities Assumed Inventories $ 120.8 Loaner vehicles 57.0 Property and equipment 36.5 Goodwill 360.4 Manufacturer franchise rights 324.0 Operating lease right-of-use assets 202.7 Total assets acquired 1,101.4 Operating lease liabilities (202.2) Other liabilities (9.3) Total liabilities assumed (211.5) Net assets acquired $ 889.9 On May 20, 2021, we exercised the purchase option for certain Park Place real estate leases whose original operating lease right-of-use assets and liabilities totaled $99.5 million. We acquired these properties for $217.1 million which was partly financed through the 2021 BofA Real Estate Facility. The Company's Consolidated Statements of Income included revenue attributable to Park Place for the year ended December 31, 2021 of $1.79 billion. The Company recorded $1.3 million of acquisition related costs during the year ended December 31, 2020. These costs are included in Selling, general, and administrative in the Consolidated Statements of Income. The Company's Consolidated Statements of Income included revenue and net income attributable to Park Place from August 24, 2020 through December 31, 2020 of $589.6 million and $27.6 million, respectively. The following represents the unaudited pro forma information as if Park Place had been included in the consolidated results of the Company since January 1, 2019: For the Year Ended December 31, 2020 2019 (In millions) (Unaudited) Pro forma revenue $ 7,989.6 $ 8,828.1 Pro forma net income $ 276.2 $ 234.0 This pro forma information incorporates the Company's accounting policies and adjusts the results of Park Place for depreciation, rent expense, and interest expense assuming that the fair value adjustments and indebtedness incurred in connection with the Park Place Acquisition had occurred on January 1, 2019. They have also been adjusted to reflect the $1.3 million of acquisition related costs incurred during 2020 as having occurred on January 1, 2019. The pro forma information also assumes that the September 2020 divestiture of the Lexus Greenville dealership, which was related to the Park Place Acquisition, occurred on January 1, 2019. Other Acquisitions and Divestitures In addition to the LHM Acquisition during the year ended December 31, 2021, we acquired the assets of 11 franchises (10 dealership locations) in in the Denver, Colorado market and three franchises (one dealership location) in the Indianapolis, Indiana market for a combined purchase price of $485.7 million. We funded these acquisitions with an aggregate of $455.1 million of cash and $9.6 million of floor plan borrowings for the purchase of the related new vehicle inventory. In the aggregate, these acquisitions included purchase price holdbacks of $21.0 million for potential indemnity claims made by us with respect to the acquired franchises. In addition to the acquisition amounts above, we released $1.0 million of purchase price holdbacks related to current and prior year acquisitions during the year ended December 31, 2021. In addition to the Park Place Acquisition during the year ended December 31, 2020, we acquired the assets of three franchises (one dealership location) in the Denver, Colorado market for a combined purchase price of $63.6 million. We funded this acquisition with an aggregate of $34.5 million of cash and $27.1 million of floor plan borrowings for the purchase of the related new vehicle inventory. In the aggregate, this acquisition included purchase price holdbacks of $2.0 million for potential indemnity claims made by us with respect to the acquired franchises. In addition to the acquisition amounts above, we released $2.5 million of purchase price holdbacks related to current and prior year acquisitions during the year ended December 31, 2020. During the year ended December 31, 2019, we acquired the assets of nine franchises (five dealership locations) and one collision center in the Indianapolis, Indiana market and one franchise (one dealership location) in the Denver, Colorado market for a combined purchase price of $210.4 million. We funded these acquisitions with an aggregate of $153.9 million of cash and $55.3 million of floor plan borrowings for the purchase of the related new vehicle inventory. In the aggregate, these acquisitions included purchase price holdbacks of $1.2 million for potential indemnity claims made by us with respect to the acquired franchises. In addition to the acquisition amounts above, we released $ 0.8 million of purchase price holdbacks related to a prior year acquisition. Goodwill and manufacturer franchise rights associated with our Dealership segment acquisitions will be deductible for federal and state income tax purposes ratably over a 15-year period. Below is the allocation of the purchase price for the acquisitions (other than the LHM Acquisition and the Park Place Acquisition) for the years ended December 31, 2021 and 2020. For the 11 franchises (10 dealership locations) in the Denver, Colorado market and three franchises (one dealership location) in the Indianapolis, Indiana market acquired in 2021, the preliminary acquisition accounting is based upon the Company’s estimates of fair value. The estimated fair values of the assets acquired and liabilities assumed and the related preliminary acquisition accounting are based on management’s estimates and assumptions, as well as other information compiled by management. As the initial acquisition accounting is based on our preliminary assessments, actual values may differ (possibly materially) when final information becomes available that differs from our current estimates. Additionally, the total consideration transferred is subject to certain post-close adjustments. We believe that the information gathered to date provides a reasonable basis for estimating the preliminary fair values of assets acquired and liabilities assumed. We will continue to evaluate these items until they are satisfactorily resolved and adjust our acquisition accounting accordingly, within the allowable measurement period. For the Year Ended December 31, 2021 2020 (In millions) Inventory $ 38.3 $ 29.8 Real estate 99.9 14.5 Property and equipment 4.4 0.4 Goodwill 187.2 5.4 Manufacturer franchise rights 150.5 13.8 Loaner vehicles 8.9 — Other (3.5) (0.3) Total purchase price $ 485.7 $ 63.6 During the year ended December 31, 2021, we sold one franchise (one dealership location) in the Charlottesville, Virginia market. The Company recorded a pre-tax gain totaling $8.0 million, which is presented in our accompanying Consolidated Statements of Income as Gain on dealership divestitures, net. During the year ended December 31, 2020, we sold two franchises (two dealership locations) in the Atlanta, Georgia market, we sold six franchises (five dealership locations) and one collision center in the Jackson, Mississippi market, and we sold one franchise (one dealership location) in the Greenville, South Carolina market. The Company recorded a pre-tax gain totaling $62.3 million, which is presented in our accompanying Consolidated Statements of Income as Gain on dealership divestitures, net. During the year ended December 31, 2019, we sold one franchise (one dealership location) and one collision center in the Houston, Texas market. The Company divested $30.1 million of assets, which primarily consisted of inventory and property and equipment, resulting in a pre-tax gain of $11.7 million, which is presented in our accompanying Consolidated Statements of Income as Gain on divestitures. The divested businesses would not be considered a significant subsidiary as defined in Rule 1-02(w) of Regulation S-X. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2021 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE | ACCOUNTS RECEIVABLE Accounts receivable consisted of the following: As of December 31, 2021 2020 (In millions) Vehicle receivables $ 73.1 $ 61.2 Manufacturer receivables 44.0 57.1 Other receivables 114.3 38.4 Total accounts receivable 231.4 156.7 Less—Allowance for credit losses (1.6) (1.2) Accounts receivable, net $ 229.8 $ 155.5 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories consisted of the following: As of December 31, 2021 2020 (In millions) New vehicles $ 206.5 $ 640.0 Used vehicles 402.0 188.5 Parts and accessories 109.9 46.7 Total inventories, net (a) $ 718.4 $ 875.2 ____________________________ (a) Amounts reflected for inventory as of December 31, 2021, excluded $24.1 million, of inventories classified as Assets held for sale. The lower of cost and net realizable value reserves reduced total inventory cost by $7.7 million and $6.7 million, respectively as of December 31, 2021 and December 31, 2020. As of December 31, 2021 and December 31, 2020, certain automobile manufacturer incentives reduced new vehicle inventory cost by $1.2 million and $8.3 million, respectively, and reduced new vehicle cost of sales for the year ended December 31, 2021, 2020, and 2019 by $60.4 million, $47.0 million, and $45.7 million, respectively. New vehicle inventories as of December 31, 2021 have decreased from December 31, 2020 as a result of manufacturer production challenges caused by the semiconductor chip shortage. |
ASSETS HELD FOR SALE
ASSETS HELD FOR SALE | 12 Months Ended |
Dec. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
ASSETS HELD FOR SALE | ASSETS HELD FOR SALE Assets and liabilities classified as held for sale include (i) assets and liabilities associated with pending dealership disposals,(ii) real estate not currently used in our operations that we are actively marketing to sell and (iii) the related mortgage notes payable, if applicable. A summary of assets held for sale and liabilities associated with assets held for sale is as follows: As of December 31, 2021 2020 (In millions) Assets: Inventory $ 24.1 $ — Loaners, net 4.6 — Property and equipment, net 110.8 28.3 Operating lease right-of-use assets 7.1 — Goodwill 118.5 — Franchise rights 110.0 — Total Assets held for sale 375.1 28.3 Liabilities: Floor plan notes payable—non-trade 9.1 — Loaners/ Notes payable 4.6 — Current maturities of long-term debt — 0.5 Current maturities of operating leases 2.7 — Long-term debt — 8.4 Operating lease liabilities 4.4 — Total Liabilities associated with assets held for sale 20.8 8.9 Net assets held for sale $ 354.3 $ 19.4 As of December 31, 2021, assets held for sale consisted of eight franchises (eight dealership locations) in addition to one real estate property not currently used in our operations. Assets and liabilities associated with these dealerships and properties totaled $375.1 million and $20.8 million, respectively. As of December 31, 2020, assets held for sale consisted of three real estate properties not used in our operations. Assets and liabilities associated with these properties totaled $28.3 million and $8.9 million, respectively. During the year ended December 31, 2021, the Company sold one franchise (one dealership location) for a pre-tax gain totaling $8.0 million and two vacant properties with a net book value of $12.5 million. During the year ended December 31, 2020, the Company sold nine franchises (eight dealership locations) and one collision center for a pre-tax gain totaling $62.3 million and one vacant property with a net book value of $3.7 million. During the year ended December 31, 2020, we recorded $0.7 million of impairment expense related to a real estate property we were actively marketing to sell, based on offers received from prospective buyers and third-party brokers' opinions of value. We did not record impairment expense associated with real estate properties that we were actively marketing to sell during the year ended December 31, 2021. |
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
Other Assets [Abstract] | |
OTHER CURRENT ASSETS | OTHER CURRENT ASSETS Other current assets consisted of the following: As of December 31, 2021 2020 (In millions) Loaner vehicles $ 150.3 $ 136.0 Contract assets (see Note 2) 27.2 20.4 Prepaid expenses 12.7 13.4 Prepaid taxes 4.6 7.1 Deposits 1.5 1.1 Other 7.4 5.8 Other current assets $ 203.7 $ 183.8 |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | INVESTMENTS The acquisition of TCA included an investment portfolio funded primarily by product premiums. The amortized cost, gross unrealized gains and losses and estimated fair values of debt securities available-for-sale, equity securities, and other investments measured at net asset value are as follows: As of December 31, 2021 Amortized Cost Allowance For Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value (In millions) Short-term investments $ 11.0 $ — $ — $ — $ 11.0 U.S Treasury 7.5 — — (0.1) 7.4 Municipal 27.9 — 0.4 (0.1) 28.2 Corporate 9.5 — 0.1 (0.1) 9.5 Mortgage and other asset-backed securities 8.8 — 0.1 (0.1) 8.8 Total debt securities 64.7 — 0.6 (0.4) 64.9 Common stock 65.2 — — — 65.2 Other investments measured at net asset value 4.4 — — — 4.4 Total investments $ 134.3 $ — $ 0.6 $ (0.4) $ 134.5 As of December 31, 2021, the Company had $0.6 million of accrued interest receivable, which is included in Other current assets on the Consolidated Balance Sheet. The Company does not consider accrued interest receivable in the carrying amount of financial assets held at amortized cost basis or in the allowance for credit losses calculation. A summary of amortized costs and fair value of investments by time to maturity, is as follows: As of December 31, 2021 Amortized Costs Fair Value (In millions) Due in 1 year or less $ 11.0 $ 11.0 Due in 1-5 years 44.6 44.8 Due in 5-10 years 0.3 0.3 Due after 10 years — — Total by maturity 55.9 56.1 Mortgage and other asset-backed securities 8.8 8.8 Common stock 65.2 65.2 Other investments measured at net asset value 4.4 4.4 Total investment securities $ 134.3 $ 134.5 There were no gross gains and losses realized related to sales of available-for-sale debt securities carried at fair value from the acquisition date of December 17, 2021 to December 31, 2021 The following table summarizes the amount of unrealized losses, defined as the amount by which the amortized cost exceeds fair value, and the related fair value of investments with unrealized losses as of December 31, 2021. The investments were segregated into two categories: those that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position of 12 or more months. The reference point for determining how long an investment was in an unrealized loss position was December 31, 2021. All investments were acquired in the LHM acquisition on December 17, 2021, therefore there are no unrealized losses greater than 12 months at December 31, 2021. As of December 31, 2021 Less than 12 Months Greater than 12 Months Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (In millions) U.S Treasury 7.1 (0.1) — — 7.1 (0.1) Municipal 10.0 (0.1) — — 10.0 (0.1) Corporate 6.4 (0.1) — — 6.4 (0.1) Mortgage and other asset-backed securities 5.8 (0.1) — — 5.8 (0.1) Total debt securities $ 29.3 $ (0.4) $ — $ — $ 29.3 $ (0.4) |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following: As of December 31, 2021 2020 (In millions) Land $ 704.3 $ 350.5 Buildings and leasehold improvements 1,338.5 691.6 Machinery and equipment 128.8 107.4 Furniture and fixtures 87.3 72.9 Company vehicles 12.1 9.5 Construction in progress 46.9 19.9 Gross property and equipment 2,317.9 1,251.8 Less—Accumulated depreciation (327.9) (295.6) Property and equipment, net (a) $ 1,990.0 $ 956.2 ______________________________ (a) Amounts reflected for Property and equipment, net as of December 31, 2021 and 2020, excluded $110.8 million and $28.3 million, respectively classified as Assets held for sale. In addition, Property and equipment, net as of December 31, 2021 and 2020 included finance leases of $8.4 million and $14.6 million, respectively. During the years ended December 31, 2021, 2020, and 2019, we capitalized $0.8 million, $0.4 million, and $0.6 million, respectively, of interest in connection with various capital projects to upgrade or remodel our facilities. Depreciation expense was $41.9 million, $38.5 million, and $36.2 million for the years ended December 31, 2021, 2020, and 2019, respectively. |
GOODWILL AND INTANGIBLE FRANCHI
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS | GOODWILL AND INTANGIBLE FRANCHISE RIGHTS Our acquisitions have resulted in the recording of goodwill and intangible franchise rights. Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Intangible franchise rights is an asset representing our rights under franchise agreements with vehicle manufacturers. Goodwill and intangible franchise rights are tested annually as of October 1 st , or more frequently in the event that facts and circumstances indicate a triggering event has occurred. On December 17, 2021, the Company completed the LHM Acquisition, thereby acquiring 54 new vehicle dealerships, seven used car stores, 11 collision centers, a used vehicle wholesale business, the real property related thereto, and the entities comprising the TCA operations for a total purchase price of $3.48 billion. We preliminarily recorded goodwill of $1.64 billion, franchise rights of $870.0 million and value of business acquired ("VOBA") of $5.6 million in connection with the LHM Acquisition. We determined that the TCA operations are a separate operating and reportable segment from our dealership operations and have therefore allocated goodwill of $1.64 billion associated with the LHM Acquisition between our reportable segments. Approximately $710.3 million of goodwill was allocated to the TCA segment and $929.0 million was allocated to the Dealerships segment. This allocation is preliminary and subject to change once the purchase price allocation is finalized. Values may differ, possibly materially, when final information becomes available that differs from current estimates. As a result of the LHM Acquisition, the Company now operates in two reportable segments namely, the Dealerships and TCA segments. The changes in goodwill and intangible franchise rights for the years ended December 31, 2021 and 2020 are as follows: Goodwill (In millions) Balance as of December 31, 2019 (a) $ 201.7 Acquisitions 364.3 Divestitures (9.1) Reclassified from assets held for sale 5.3 Balance as of December 31, 2020 (a) $ 562.2 Acquisitions 1,828.6 Divestitures (0.6) Reclassified to assets held for sale (118.5) Balance as of December 31, 2021 (a) $ 2,271.7 _____________________________ (a) Net of accumulated impairment losses of $537.7 million recorded prior to the year ended December 31, 2019. Intangible Franchise Rights (In millions) Balance as of December 31, 2019 $ 121.7 Acquisitions 337.8 Divestitures (11.3) Impairments (23.0) Balance as of December 31, 2020 $ 425.2 Acquisitions 1,020.5 Reclassified to assets held for sale (110.0) Balance as of December 31, 2021 $ 1,335.7 We elected to perform a qualitative assessment for our October 1, 2021 goodwill and franchise rights impairment testing and determined that it was more likely than not that the fair value of our reporting units exceeded their carrying value. We did not record an impairment charge for goodwill or franchise rights in the year ended December 31, 2021. As a result of the adverse impact on our dealership operations caused by the COVID-19 pandemic in the first quarter of 2020, the Company considered the extent to which the COVID-19 impacts combined with other relevant circumstances (e.g., the results of the Company’s impairment test) could affect the significant inputs used to determine the fair value of the Company’s franchise rights and goodwill associated with the Company’s reporting units. To the extent that we determined that the totality of events and circumstances, and their effect on the significant inputs into the fair value determination of our franchise rights and reporting units, would more likely than not lead to an impairment of the carrying value of the franchise rights or goodwill reporting units, we performed quantitative impairment tests as of March 31, 2020. The quantitative impairment tests for franchise rights included a comparison of the estimated fair value to the carrying value of each franchise right asset. The Company estimates fair value by using a discounted cash flow model (income approach) based on market participant assumptions related to the cash flows directly attributable to the franchise. These assumptions include year-over-year and terminal growth rates, working capital requirements, weighted average cost of capital, future gross margins, and future selling, general, and administrative expenses. The results of the quantitative impairment testing identified that the carrying values of certain of our franchise rights assets exceeded their fair value. As a result, we recognized a $23.0 million pre-tax non-cash impairment charge during the three months ended March 31, 2020. We also performed qualitative assessments on the remaining franchise rights and goodwill reporting units as of March 31, 2020. The results of our quantitative and qualitative assessments indicated that the carrying value of goodwill related to all reporting units did not exceed their fair value. |
FLOOR PLAN NOTES PAYABLE_TRADE
FLOOR PLAN NOTES PAYABLE—TRADE | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
FLOOR PLAN NOTES PAYABLE—TRADE | FLOOR PLAN NOTES PAYABLE—TRADEWe consider floor plan notes payable to a party that is affiliated with the entity from which we purchase our new vehicle inventory as Floor Plan Notes Payable—Trade on our Consolidated Balance Sheets. Floor plan notes payable—trade, net consisted of the following: As of December 31, 2021 2020 (In millions) Floor plan notes payable—trade $ 39.3 $ 71.7 Floor plan notes payable offset account (2.0) (6.8) Total floor plan notes payable—trade, net $ 37.3 $ 64.9 We have a floor plan facility with the Ford Motor Credit Company ("Ford Credit") to purchase new Ford and Lincoln vehicle inventory. Our floor plan facility with Ford Credit was amended in July 2020 and can be terminated by either the Company or Ford Credit with a 30-day notice period. We have established a floor plan notes payable offset account with Ford Credit that allows us to transfer cash to the account as an offset to our outstanding Floor Plan Notes Payable—Trade. These transfers reduce the amount of outstanding new vehicle floor plan notes payable that would otherwise accrue interest, while retaining the ability to transfer amounts from the offset account into our operating cash accounts within one to two days. As a result of using our floor plan offset account, we experienced a reduction in Floor plan interest expense on our Consolidated Statements of Income. The representations and covenants contained in the agreement governing our floor plan facility with Ford Credit are customary for financing transactions of this nature. Further, the agreement governing our floor plan facility with Ford Credit also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, the Company could be required to immediately repay all outstanding amounts under our floor plan facility with Ford Credit. |
FLOOR PLAN NOTES PAYABLE_NON-TR
FLOOR PLAN NOTES PAYABLE—NON-TRADE | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
FLOOR PLAN NOTES PAYABLE—NON-TRADE | FLOOR PLAN NOTES PAYABLE—NON-TRADE We consider floor plan notes payable to a party that is not affiliated with the entity from which we purchase our new vehicle inventory as Floor Plan Notes Payable—Non-Trade on our Consolidated Balance Sheets. Floor plan notes payable—non-trade, net consisted of the following: As of December 31, 2021 2020 (In millions) Floor plan notes payable—new non-trade (a) $ 314.7 $ 715.9 Floor plan notes payable—used non-trade 294.0 — Floor plan notes payable offset account (81.5) (78.6) Total floor plan notes payable—non-trade, net $ 527.2 $ 637.3 ___________________________ (a) Amounts reflected for Floor plan notes payable—new non-trade as of December 31, 2021, excluded $9.1 million classified as Liabilities associated with assets held for sale. 2019 Senior Credit Facility In connection with the LHM Acquisition, as of October 29, 2021 we entered into a Third Amendment (the "October 29, 2021 Amendment") to the Third Amended and Restated Credit Agreement dated September 25, 2019 with Bank of America, N.A. ("Bank of America"), as administrative agent, and the other lenders party thereto (the "2019 Senior Credit Facility"). As a result of the October 29, 2021 Amendment, among other things, the 2019 Senior Credit Facility (1) increased the aggregate commitments under the Revolving Credit Facility to $450.0 million (2) increased the aggregate commitments under the Used Vehicle Floorplan Facility to $350.0 million, (3) increased the aggregate commitments under the New Vehicle Floorplan Facility to $1.75 billion, (4) removed our minimum consolidated current ratio covenant, and (5) permitted the use of borrowings under the 2021 Senior Credit Facility to fund a portion of the consideration for the LHM Acquisition. Proceeds from borrowings under the 2019 Senior Credit Facility will be used, among other things, (i) to finance the purchase of new and used vehicles by the Company and certain of its subsidiaries, (ii) for working capital needs of the Company and certain of its subsidiaries, and (iii) for other general corporate purposes of the Company and certain of its subsidiaries. Subject to compliance with certain conditions, the 2019 Senior Credit Agreement provides that we have the ability, at our option and subject to the receipt of additional commitments from existing or new lenders, to increase the size of the facilities by up to $350.0 million in the aggregate without lender consent. In addition, we have the ability to convert a portion of our availability under the Revolving Credit Facility to the New Vehicle Floor Plan Facility or the Used Vehicle Floor Plan Facility. The maximum amount we are allowed to convert is determined based on our aggregate revolving commitment under the Revolving Credit Facility, less $50.0 million. In addition, we are able to convert any amounts moved to the New Vehicle Floor Plan Facility or Used Vehicle Floor Plan Facility back to the Revolving Credit Facility. In connection with the New Vehicle Floor Plan Facility, we continue to maintain an offset account with Bank of America that allows us to transfer cash as an offset to floor plan notes payable. These transfers reduce the amount of outstanding new vehicle floor plan notes payable that would otherwise accrue interest, while retaining the ability to transfer amounts from the offset account into our operating cash accounts within one to two days. As a result of the use of our floor plan offset account, we experienced a reduction in Floor plan interest expense on our Consolidated Statements of Income. Borrowings under the 2019 Senior Credit Facility bear interest, at our option, based on the London Interbank Offered Rate ("LIBOR") or the Base Rate, in each case plus an Applicable Rate. The Base Rate is the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the Bank of America prime rate, and (iii) one month LIBOR plus 1.00%. Applicable Rate means with respect to the Revolving Credit Facility, a range from 1.00% to 2.00% for LIBOR loans and 0.15% to 1.00% for Base Rate loans, in each case based on the Company's consolidated total lease adjusted leverage ratio. Borrowings under the New Vehicle Floorplan Facility bear interest, at our option, based on LIBOR plus 1.10% or the Base Rate plus 0.10%. Borrowings under the Used Vehicle Floorplan Facility bear interest, at our option, based on LIBOR plus 1.40% or the Base Rate plus 0.40%. In addition to the payment of interest on borrowings outstanding under the 2019 Senior Credit Facility, we are required to pay a quarterly commitment fee on total unused commitments thereunder. The fee for unused commitments under the Revolving Credit Facility is between 0.15% and 0.40% per year, based on the Company's total lease adjusted leverage ratio, and the fee for unused commitments under the New Vehicle Facility Floor Plan and the Used Vehicle Facility Floor Plan Facility is 0.15% per year. The 2019 Senior Credit Facility matures, and all amounts outstanding thereunder will be due and payable, on September 25, 2024. The representations and covenants contained in the 2019 Senior Credit Agreement are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2019 Senior Credit Agreement. In addition, certain other covenants could restrict the Company's ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2019 Senior Credit Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. In certain instances, an event of default under either the Revolving Credit Facility or the Used Vehicle Floorplan Facility could be, or result in, an event of default under the New Vehicle Floorplan Facility, and vice versa. Upon the occurrence of an event of default, the Company could be required to immediately repay all amounts outstanding under the applicable facility. See the "Representations and Covenants" section below under our "Long-Term Debt" footnote for a description of the representations, covenants and events of default contained in the 2019 Senior Credit Facility. |
ACCOUNTS PAYABLE AND ACCRUED LI
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES | ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Accounts payable and accrued liabilities consisted of the following: As of December 31, 2021 2020 (In millions) Accounts payable $ 163.9 $ 97.6 Loaner vehicles notes payable (a) 146.3 132.7 Taxes payable 125.7 69.1 Accrued compensation 118.5 43.7 Accrued insurance 27.9 24.3 Accrued finance and insurance chargebacks 31.5 23.3 Accrued interest 24.3 16.4 Customer deposits 23.2 8.7 Unearned premium 13.0 — Accrued licenses and regulatory fees 9.6 9.6 Customer we owe liabilities 7.0 2.8 Accrued advertising 3.3 3.2 Other 48.7 19.5 Accounts payable and accrued liabilities $ 742.9 $ 450.9 ____________________________ (a) Amounts reflected for Loaner vehicles notes payable as of December 31, 2021, excluded $4.6 million classified as Liabilities associated with assets held for sale. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | DEBT Long-term debt consisted of the following: As of December 31, 2021 2020 (In millions) 4.50% Senior Notes due 2028 405.0 405.0 4.625% Senior Notes due 2029 800.0 — 4.75% Senior Notes due 2030 445.0 445.0 5.00% Senior Notes due 2032 600.0 — Mortgage notes payable bearing interest at fixed rates (the weighted average interest rates were 4.6% and 5.4% for the year ended December 31, 2021 and 2020, respectively) 71.7 79.2 2021 Real Estate Facility 689.7 — 2021 BofA Real Estate Facility 180.7 — 2018 Bank of America Facility 78.8 84.2 2018 Wells Fargo Master Loan Facility (a) 81.9 86.9 2013 BofA Real Estate Facility 31.1 33.6 2015 Wells Fargo Master Loan Facility (b) 53.2 61.7 2019 Syndicated Revolving Credit Facility 169.0 — Finance lease liability 8.4 16.6 Total debt outstanding 3,614.5 1,212.2 Add—unamortized premium on 4.50% Senior Notes due 2028 1.0 1.2 Add—unamortized premium on 4.75% Senior Notes due 2030 1.8 2.1 Less—debt issuance costs (34.7) (13.7) Long-term debt, including current portion 3,582.6 1,201.8 Less—current portion, net of debt issuance costs (62.5) (36.6) Long-term debt $ 3,520.1 $ 1,165.2 ____________________________ (a) Amounts reflected for the 2018 Wells Fargo Master Loan Facility as of December 31, 2020, exclude $5.1 million classified as Liabilities associated with assets held for sale. (b) Amounts reflected for the 2015 Wells Fargo Master Loan Facility as of December 31, 2020, exclude $3.8 million classified as Liabilities associated with assets held for sale. The aggregate maturities of long-term debt as of December 31, 2021 are as follows (in millions): 2022 $ 53.7 2023 75.9 2024 263.7 2025 142.7 2026 574.3 Thereafter 2,504.2 Total maturities of long-term debt $ 3,614.5 Senior Notes issued in 2021 In connection with the LHM Acquisition, on November 19, 2021, the Company completed its offering of $800 million aggregate principal amount of 4.625% senior notes due 2029 (the “2029 Notes”) and $600 million aggregate principal amount of 5.000% senior notes due 2032 (the “2032 Notes”). The Company paid lender fees of $17.5 million in conjunction with the offering of the 2029 Notes and 2032 Notes and incurred additional debt issuance costs of $4.0 million. The lender fees and other debt issuance costs incurred are being amortized over the terms of the 2029 and 2032 Notes using the effective interest method. The 2029 Notes will mature on November 15, 2029. We may redeem some or all of the 2029 Notes at any time on and after November 15, 2024 at redemption prices specified in the 2029 Notes Indenture. Prior to November 15, 2024, we may also redeem up to 40% of the aggregate principal amount of the 2029 Notes using the proceeds from certain equity offerings at a redemption price of 104.625% of their principal amount plus accrued and unpaid interest, if any, to, but not including the redemption date. In addition, we may redeem some or all of the 2029 Notes at any time prior to November 15, 2024 at a price equal to 100% of the principal amount thereof plus a make-whole premium set forth in the 2029 Notes Indenture, and accrued and unpaid interest, if any. If we sell certain of our assets or experience specific kinds of changes of control, we must offer to repurchase the 2029 Notes. The 2032 Notes mature on February 15, 2032. We may redeem some or all of the 2032 Notes at any time on and after November 15, 2026 at redemption prices specified in the 2032 Notes Indenture. Prior to November 15, 2026, we may also redeem up to 40% of the aggregate principal amount of the 2032 Notes using the proceeds from certain equity offerings at a redemption price of 105.000% of their principal amount plus accrued and unpaid interest to, if any, but not including the redemption date. In addition, we may redeem some or all of the 2032 Notes at any time prior to November 15, 2026 at a price equal to 100% of the principal amount thereof plus a make-whole premium set forth in the 2032 Notes Indenture, and accrued and unpaid interest, if any. If we sell certain of our assets or experience specific kinds of changes of control, we must offer to repurchase the 2032 Notes. We are a holding company with no independent assets or operations. For all relevant periods presented, our 2029 Notes and 2032 Notes have been fully and unconditionally guaranteed, on a joint and several basis, by substantially all of our subsidiaries other than Landcar Administration Company, Landcar Agency, Inc., and Landcar Casualty Company (collectively, the “TCA Non-Guarantor Subsidiaries”). Senior Notes issued in 2020 In connection with the 2019 Acquisition, on February 19, 2020, the Company completed its offering of senior unsecured notes (the "February 2020 Offering"), consisting of $525.0 million aggregate principal amount of 4.50% Senior Notes due 2028 (the "Existing 2028 Notes") and together with the Additional 2028 Notes ((as defined below), the "2028 Notes") and $600.0 million aggregate principal amount of 4.75% Senior Notes due 2030 (the "Existing 2030 Notes" and, together with the Existing 2028 Notes, the "Existing Notes") and together with the Additional 2030 Notes ((as defined below), the "2030 Notes"). The Company paid lender fees of $6.8 million in conjunction with the February 2020 Offering and incurred additional debt issuance costs of $3.1 million. As a result of the termination of the 2019 Acquisition, the Company delivered a notice of special mandatory redemption to holders of its Existing 2028 Notes and Existing 2030 Notes pursuant to which it would redeem on a pro rata basis (1) $245.0 million of the Existing 2028 Notes and (2) $280.0 million of the 2030 Existing Notes, in each case, at 100% of the respective principal amount plus accrued and unpaid interest to but excluding, the special mandatory redemption date. On March 30, 2020, the Company completed the redemption and recorded a write-off of unamortized debt issuance costs of $1.5 million. In September 2020, the Company completed an issuance of $250.0 million aggregate principal amount of additional senior unsecured notes (the "September 2020 Offering") consisting of $125.0 million aggregate principal amount of additional 4.50% Senior Notes due 2028 (the "Additional 2028 Notes") at a price of 101.00% of par, plus accrued interest from September 1, 2020, and $125.0 million aggregate principal amount of additional 4.75% Senior Notes due 2030 (the "Additional 2030 Notes" and together with the Additional 2028 Notes, the "Additional Notes") at a price of 101.75% of par, plus accrued interest from September 1, 2020. After deducting the initial purchasers' discounts of $2.8 million, we received net proceeds of approximately $250.6 million from the September 2020 Offering. The $3.5 million premium paid by the initial purchasers of the Additional Notes was recorded as a component of long-term debt on our Consolidated Balance Sheet and is being amortized as a reduction of interest expense over the remaining term of the Additional Notes. The proceeds of the September 2020 Offering were used to redeem the Seller Notes issued in connection with the Park Place Acquisition and repay approximately $50.0 million in aggregate principal amount outstanding under our Revolving Credit Facility. The lender fees and other debt issuance costs incurred are being amortized over the terms of the Notes using the effective interest method. The 2028 Notes and 2030 Notes mature on March 1, 2028 and March 1, 2030, respectively. Interest is payable semiannually, on March 1 and September 1 of each year. The February 2020 Offering, together with additional borrowings and cash on hand, was incurred to (i) fund the acquisition of substantially all of the assets of Park Place, (ii) redeem all of our outstanding $600.0 million aggregate principal amount of the 6.0% Notes (the "6.0% Notes") and (iii) pay fees and expenses in connection with the foregoing. The remaining outstanding 2028 Notes and 2030 Notes are subject to customary covenants, events of default and optional redemption provisions. In addition, the remaining outstanding 2028 Notes and 2030 Notes were required to be registered under the Securities Act of 1933 within 270 days of the closing date for the offering. The Company completed the registration of the 2028 Notes and 2030 Notes in October 2020. We are a holding company with no independent assets or operations. For all relevant periods presented, our 2028 Notes and 2030 Notes have been fully and unconditionally guaranteed, on a joint and several basis, by substantially all of our subsidiaries other than the TCA Non-Guarantor Subsidiaries. 6.0% Senior Subordinated Notes due 2024 On February 3, 2020, we issued a conditional notice of redemption to the holders of our 6.0% Senior Subordinated Notes due 2024, notifying such holders that we intended to redeem all of the 6.0% Notes. On March 4, 2020, the 6.0% Notes were redeemed at 103% of par, plus accrued and unpaid interest to, but excluding, the date of redemption. We recorded a loss on extinguishment of the 6.0% Notes of $19.1 million which comprised a redemption premium of $18.0 million and the net write-off of the unamortized premium and debt issuance costs of $1.1 million related to the 6.0% Notes on the redemption date. Seller Notes The Seller Notes comprised $150.0 million in aggregate principal amount of 4.00% promissory note due August 2021 and $50.0 million in aggregate principal amount of a 4.00% promissory note due February 2022 and were issued on August 24, 2020 in conjunction with the Park Place Acquisition. In September 2020, the Company redeemed the Seller Notes with the proceeds of the September 2020 Offering. Mortgage Financings We have multiple mortgage agreements with finance companies affiliated with our vehicle manufacturers ("captive mortgages") and other lenders. As of December 31, 2021 and 2020, we had total mortgage notes payable outstanding of $71.7 million and $79.2 million, respectively, which are collateralized by the associated real estate. 2021 Real Estate Facility On December 17, 2021, we entered into a real estate term loan credit agreement with Bank of America, N.A., as administrative agent and the various financial institutions party thereto, as lenders, which provides for term loans in an aggregate amount equal to $689.7 million (the “2021 Real Estate Facility”). The Company used the proceeds from these borrowings to finance the purchase of the real property in connection with the LHM Acquisition as well as other recent acquisitions and other unencumbered real property. Term loans under the 2021 Real Estate Facility bear interest, at our option, based on (1) Daily Simple SOFR plus 1.55% - 1.95% per annum (as determined by the consolidated total lease adjusted leverage ratio), or (2) the Base Rate (as described below) plus 0.55% - 0.95% per annum (as determined by the consolidated total lease adjusted leverage ratio). The Base Rate is the highest of (i) the Federal Funds rate plus 0.50%, (ii) the Bank of America prime rate, (iii) the Daily Simple SOFR plus 1.0% and (iv) 1.00%. We will be required to make 20 consecutive quarterly principal payments of 1.25% of the initial amount of each loan, with a balloon repayment of the outstanding principal amount of loans due on the maturity date. The 2021 Real Estate Facility matures five years from the initial funding date. Borrowings under the 2021 Real Estate Facility are guaranteed by us, and are collateralized by first priority liens, subject to certain permitted exceptions, on all of the real property financed thereunder. As of December 31, 2021, we had $689.7 million in term loans outstanding under the 2021 Real Estate Facility. 2021 BofA Real Estate Facility On May 20, 2021, the Company and certain of its subsidiaries borrowed $184.4 million under a real estate term loan credit agreement, dated as of May 10, 2021 (the “2021 BofA Real Estate Credit Agreement”), by and among the Company and certain of its subsidiaries, Bank of America, N.A., as administrative agent and the various financial institutions party thereto, as lenders, which provides for term loans in an aggregate amount equal to $184.4 million, subject to customary terms and conditions (the “2021 BofA Real Estate Facility”). The Company used the proceeds from these borrowings to finance the exercise of its option to purchase certain of the leased real property under the definitive agreements entered into in connection with the acquisition of the Park Place Dealerships. The Company completed the purchase of the leased real property on May 20, 2021. Term loans under our 2021 BofA Real Estate Facility bear interest, at our option, based on (1) LIBOR plus 1.65% per annum or (2) the Base Rate (as described below) plus 0.65% per annum. The Base Rate is the highest of (i) the Federal Funds rate plus 0.50%, (ii) the Bank of America prime rate, and (iii) one month LIBOR plus 1.0%. We will be required to make 39 consecutive quarterly principal payments of 1.00% of the initial amount of each loan, with a balloon repayment of the outstanding principal amount of loans due on the maturity date. The 2021 BofA Real Estate Facility matures ten years from the initial funding date. Borrowings under the 2021 BofA Real Estate Facility are guaranteed by us and each of our operating dealership subsidiaries that leased the real estate now financed under the 2021 BofA Real Estate Facility, and are collateralized by first priority liens, subject to certain permitted exceptions, on all of the real property financed thereunder. The representations and covenants in the 2021 BofA Real Estate Facility are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2021 BofA Real Estate Facility. In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2021 BofA Real Estate Facility also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, we could be required by the 2021 BofA Real Estate Facility to immediately repay all amounts outstanding thereunder. As of December 31, 2021, we had $180.7 million in term loans outstanding under the 2021 BofA Real Estate Facility. 2018 BofA Real Estate Facility On November 13, 2018, we entered into a real estate term loan credit agreement (as amended, restated or supplemented from time to time, the “2018 BofA Real Estate Credit Agreement”) with Bank of America, as lender, providing for term loans in an aggregate amount not to exceed $128.1 million, subject to customary terms and conditions (the “2018 BofA Real Estate Facility”). Our right to make draws under the 2018 BofA Real Estate Facility terminated on November 13, 2019. Term loans under our 2018 BofA Real Estate Facility bear interest, at our option, based on LIBOR plus 1.50% or the Base Rate (as described below) plus 0.50%. The Base Rate is the highest of (i) the Federal Funds rate plus 0.50%, (ii) the Bank of America prime rate, and (iii) one month LIBOR plus 1.0%. We are required to make quarterly principal payments of 1.25% of the initial amount of each loan on a twenty As of December 31, 2021 and 2020, we had $78.8 million and $84.2 million, respectively, in term loans outstanding under the 2018 BofA Real Estate Facility. 2018 Wells Fargo Master Loan Facility On November 16, 2018, certain of our subsidiaries entered into a master loan agreement (the “2018 Wells Fargo Master Loan Agreement” and, together with the 2013 BofA Real Estate Credit Agreement, the 2015 Wells Fargo Master Loan Agreement and the 2018 BofA Real Estate Agreement, the “Existing Real Estate Credit Agreements”) with Wells Fargo Bank, National Association, as lender, which provides for term loans to certain of our subsidiaries that are borrowers under the Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $100.0 million (the "Wells Fargo Master Loan Facility"), subject to customary terms and conditions (the “2018 Wells Fargo Master Loan Facility” and, together with the 2013 BofA Real Estate Facility, the 2015 Wells Fargo Master Loan Facility and the 2018 BofA Real Estate Facility, the “Existing Real Estate Facilities”). Our right to make draws under the 2018 Wells Fargo Master Loan Facility terminated on June 30, 2020. Term loans under the 2018 Wells Fargo Master Loan Facility bear interest based on LIBOR plus an applicable margin based on a pricing grid ranging from 1.50% per annum to 1.85% per annum based on our consolidated total lease adjusted leverage ratio. We are required to make quarterly principal payments with respect to the initial amount of each loan in 108 equal monthly principal payments based on a hypothetical 19 year amortization schedule, with a balloon repayment of the outstanding principal amount of loans due on December 1, 2028. Borrowings under the 2018 Wells Fargo Master Loan Facility can be voluntarily prepaid in whole or in part any time without premium or penalty. Borrowings under the 2018 Wells Fargo Master Loan Facility are guaranteed by us pursuant to an unconditional guaranty, and all of the real property financed by any of our operating dealership subsidiaries under the 2018 Wells Fargo Master Loan Facility is collateralized by first priority liens, subject to certain permitted exceptions. On June 26, 2020, the Company borrowed an additional $69.4 million under the 2018 Wells Fargo Master Loan Facility. As of December 31, 2021 and 2020, we had $81.9 million and $86.9 million, respectively, outstanding borrowings under the 2018 Wells Fargo Master Loan Facility, which excludes amounts classified as Liabilities associated with assets held for sale. 2015 Wells Fargo Master Loan Facility On February 3, 2015, certain of our subsidiaries entered into an amended and restated master loan agreement (as amended, restated or supplemented from time to time, the “2015 Wells Fargo Master Loan Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), as lender, which provides form term loans to certain of our subsidiaries that are borrowers under the 2015 Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $100.0 million (the “2015 Wells Fargo Master Loan Facility”). Our right to make draws under the 2015 Wells Fargo Master Loan Facility terminated on February 1, 2016. Term loans under the 2015 Wells Fargo Master Loan Facility bear interest based on LIBOR plus 1.85%. We are required to make quarterly principal payments with respect to the initial amount of each loan in 108 equal monthly principal payments based on a hypothetical 19 year amortization schedule, with a balloon repayment of the outstanding principal amount of loans due on February 1, 2025. Borrowings under the 2015 Wells Fargo Master Loan Facility can be voluntarily prepaid in whole or in part any time without premium or penalty. Borrowings under the 2015 Wells Fargo Master Loan Facility are guaranteed by us pursuant to an unconditional guaranty, and all of the real property financed by any of our operating dealership subsidiaries under the 2015 Wells Fargo Master Loan Facility is collateralized by first priority liens, subject to certain permitted exceptions. As of December 31, 2021 and 2020, we had $53.2 million and $61.7 million, respectively, outstanding under the 2015 Wells Fargo Master Loan Facility, which excludes amounts classified as Liabilities associated with assets held for sale. 2013 BofA Real Estate Facility On September 26, 2013, we entered into a real estate term loan credit agreement (the “2013 BofA Real Estate Credit Agreement”) with Bank of America, N.A. (“Bank of America”), as lender, providing for term loans in an aggregate amount not to exceed $75.0 million, subject to customary terms and conditions (the “2013 BofA Real Estate Facility”). Term loans under our 2013 BofA Real Estate Facility bear interest, at our option, based on LIBOR plus 1.50% or the Base Rate (as described below) plus 0.50%. The Base Rate is the highest of (i) the Federal Funds rate plus 0.50%, (ii) the Bank of America prime rate, and (iii) one month LIBOR plus 1.0%. Our right to make draws under the 2013 BofA Real Estate Facility terminated on December 26, 2013. We are required to make quarterly principal payments of 1.25% of the initial amount of each loan on a twenty As of December 31, 2021 and 2020, we had $31.1 million and $33.6 million, respectively, in term loans outstanding under the 2013 BofA Real Estate Facility. Summary of Mortgages Below is a summary of our outstanding mortgage notes payable, the carrying values of the related collateralized real estate, and year of maturity as of December 31, 2021 and 2020: As of December 31, 2021 As of December 31, 2020 Mortgage Agreement Aggregate Principal Outstanding Carrying Value of Collateralized Related Real Estate Maturity Dates Aggregate Principal Outstanding Carrying Value of Collateralized Related Real Estate Maturity Dates Captive mortgages $ 70.9 $ 152.2 2021-2024 $ 77.4 $ 201.7 2020-2024 Other mortgage debt 0.8 42.8 2021-2022 1.8 43.2 2020-2022 2021 Real Estate Facility 689.7 928.9 2026 — — — 2021 BofA Real Estate Facility 180.7 199.4 2031 — — — 2018 BofA Real Estate Facility 78.8 105.0 2025 84.2 106.2 2025 2018 Wells Fargo Master Loan Facility (a) 81.9 105.3 2028 86.9 112.9 2028 2013 BofA Real Estate Facility 31.1 71.8 2023 33.6 73.3 2023 2015 Wells Fargo Master Loan Facility (b) 53.2 95.3 2025 61.7 109.6 2025 Total mortgage debt $ 1,187.1 $ 1,700.7 $ 345.6 $ 646.9 ____________________________ (a) Amounts reflected for the 2018 Wells Fargo Master Loan Facility as of December 31, 2020 exclude $5.1 million classified as Liabilities associated with assets held for sale. (b) Amounts reflected for the 2015 Wells Fargo Master Loan Facility as of December 31, 2020 exclude $3.8 million classified as Liabilities associated with assets held for sale. Revolving Credit Facility As discussed above under our "Floor Plan Notes Payable—Non-Trade" footnote, the 2019 Senior Credit Facility includes a $450.0 million Revolving Credit Facility. We may request Bank of America to issue letters of credit on our behalf thereunder up to $50.0 million. Availability under the Revolving Credit Facility is limited by borrowing base calculations and is reduced on a dollar-for-dollar basis by the aggregate face amount of any outstanding letters of credit. As of December 31, 2021, we had $10.8 million in outstanding letters of credit, $169.0 million drawn on our Revolving Credit Facility and $270.2 million of borrowing availability as of December 31, 2021. Proceeds from borrowings from time to time under the revolving credit facility may be used for among other things, acquisitions, working capital and capital expenditures. Borrowings under the 2019 Senior Credit Facility bear interest, at our option, based on LIBOR or the Base Rate, in each case plus an Applicable Rate. The Base Rate is the highest of (i) the Federal Funds Rate plus 0.50%, (ii) the Bank of America prime rate, and (iii) one month LIBOR plus 1.00%. Applicable Rate means with respect to the Revolving Credit Facility, a range from 1.00% to 2.00% for LIBOR loans and 0.15% to 1.00% for Base Rate loans, in each case based on the Company's consolidated total lease adjusted leverage ratio. Borrowings under the New Vehicle Floorplan Facility bear interest, at our option, based on LIBOR plus 1.10% or the Base Rate plus 0.10%. Borrowings under the Used Vehicle Floorplan Facility bear interest, at our option, based on LIBOR plus 1.40% or the Base Rate plus 0.40%. Stock Repurchase and Dividend Restrictions The 2019 Senior Credit Facility and the Indentures currently allow for restricted payments without limit so long as our Consolidated Total Leverage Ratio (as defined in the 2019 Senior Credit Facility and the Indentures) is no greater than 3.0 to 1.0 after giving effect to such proposed restricted payments. Restricted payments generally include items such as dividends, share repurchases, unscheduled repayments of subordinated debt, or purchases of certain investments. Subject to our continued compliance with a consolidated fixed charge coverage ratio and a maximum consolidated total lease adjusted leverage ratio, in each case as set out in the Indentures, restricted payments capacity additions (or subtractions if negative) equal to a base level plus the cumulative amount of (i) 50% of our net income (as defined in the 2019 Senior Credit Facility) plus (ii) 100% of any cash proceeds we receive from the sale of equity interests minus (iii) the dollar amount of share purchases made and dividends paid during the defined measurement periods, subject to certain exceptions. In the event that our Consolidated Total Leverage Ratio does (or would) exceed 3.0 to 1.0, the 2019 Senior Credit Facility and the Indentures would then also allow for restricted payments under mutually exclusive parameters, subject to certain exclusions. Under the 2028 Senior Notes and 2030 Senior Notes, our most restrictive indentures, these parameters are: • The Company may repurchase its own shares in an aggregate amount not to exceed $20.0 million in any fiscal year. • The Company may otherwise make restricted payments only up the cumulative capacity above. Our restricted payment capacity balance as of December 31, 2021 was $958.6 million. Representations and Covenants We are subject to a number of covenants in our various debt and lease agreements, including those described below. We were in compliance with all of our covenants throughout 2021. Failure to comply with any of our debt covenants would constitute a default under the relevant debt agreements, which would entitle the lenders under such agreements to terminate our ability to borrow under the relevant agreements and accelerate our obligations to repay outstanding borrowings, if any, unless compliance with the covenants is waived. In many cases, defaults under one of our agreements could trigger cross-default provisions in our other agreements. If we are unable to remain in compliance with our financial or other covenants, we would be required to seek waivers or modifications of our covenants from our lenders, or we would need to raise debt and/or equity financing or sell assets to generate proceeds sufficient to repay such debt. We cannot give any assurance that we would be able to successfully take any of these actions on terms, or at times, that may be necessary or desirable. The representations and covenants contained in the agreement governing the 2019 Senior Credit Facility are customary for financing transactions of this nature including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the agreement governing the 2019 Senior Credit Facility. In addition, certain other covenants could restrict the Company's ability to incur additional debt, pay dividends or acquire or dispose of assets. The agreement governing the 2019 Senior Credit Facility also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. In certain instances, an event of default under either the Revolving Credit Facility or the Used Vehicle Floor Plan Facility could be, or result in, an event of default under the New Vehicle Floor Plan Facility, and vice versa. Upon the occurrence of an event of default, the Company could be required to immediately repay all amounts outstanding under the applicable facility. The representations and covenants contained in the 2021 BofA Real Estate Facility are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2021 BofA Real Estate Facility. In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2021 BofA Real Estate Facility also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, we could be required to immediately repay all amounts outstanding thereunder The representations and covenants contained in the 2021 Real Estate Facility are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2021 Real Estate Facility. In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2021 Real Estate Facility also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, we could be required to immediately repay all amounts outstanding thereunder The representations and covenants contained in the 2018 BofA Real Estate Credit Agreement are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2018 BofA Real Estate Credit Agreement. In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2018 BofA Real Estate Credit Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, we could be required by the 2018 BofA Real Estate Credit Agreement to immediately repay all amounts outstanding thereunder. The representations, warranties and covenants contained in the 2018 Wells Fargo Master Loan Agreement and the related documents are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio. In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2018 Wells Fargo Master Loan Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, we could be required by the 2018 Wells Fargo Master Loan Facility to immediately repay all amounts outstanding thereunder. The representations, warranties and covenants contained in the 2015 Wells Fargo Master Loan Agreement and the related documents are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio. In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets. The 2015 Wells Fargo Master Loan Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness. Upon the occurrence of an event of default, we could be required by the 2015 Wells Fargo Master Loan Facility to immediately repay all amounts outstanding thereunder. |
FINANCIAL INSTRUMENTS AND FAIR
FINANCIAL INSTRUMENTS AND FAIR VALUE | 12 Months Ended |
Dec. 31, 2021 | |
Derivatives and Fair Value [Abstract] | |
FINANCIAL INSTRUMENTS AND FAIR VALUE | FINANCIAL INSTRUMENTS AND FAIR VALUE In determining fair value, we use various valuation approaches, including market and income approaches. Accounting standards establish 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 independent sources. 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. 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 interest rate swap instruments, exchange-traded debt securities that are not actively traded or do not have a high trading volume, mortgage notes payable, and certain real estate properties on a non-recurring basis. 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 the fair value of certain non-financial assets and non-financial liabilities in purchase acquisitions and those used in the assessment of impairment for goodwill and intangible franchise rights. 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 to determine fair value is greatest for instruments 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 that is significant to the fair value measurement. Fair value is a market-based exit price 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 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 of significant market fluctuations. Financial instruments consist primarily of cash and cash equivalents, investments, contracts-in-transit, accounts receivable, cash surrender value of corporate-owned life insurance policies, accounts payable, floor plan notes payable, subordinated long-term debt, mortgage notes payable, and interest rate swap instruments. The carrying values of our financial instruments, with the exception of subordinated long-term debt and mortgage notes payable, approximate fair value due to (i) their short-term nature, (ii) recently completed market transactions, or (iii) existence of variable interest rates, which approximate market rates. The fair value of our subordinated long-term debt is based on reported market prices in an inactive market that reflects Level 2 inputs. We estimate the fair value of our mortgage notes payable using a present value technique based on current market interest rates for similar types of financial instruments that reflect Level 2 inputs. A summary of the carrying values and fair values of our Notes and our mortgage notes payable is as follows: As of December 31, 2021 2020 (In millions) Carrying Value: 4.50% Senior Notes due 2028 $ 401.6 $ 400.9 4.625% Senior Notes due 2029 787.9 — 4.75% Senior Notes due 2030 441.2 440.6 5.00% Senior Notes due 2032 $ 590.9 $ — Mortgage notes payable (a) 1,183.6 343.7 Total carrying value $ 3,405.2 $ 1,185.2 Fair Value: 4.50% Senior Notes due 2028 $ 413.6 $ 423.2 4.625% Senior Notes due 2029 815.0 — 4.75% Senior Notes due 2030 455.0 476.2 5.00% Senior Notes due 2032 621.8 — Mortgage notes payable (a) 1,196.6 354.5 Total fair value $ 3,502.0 $ 1,253.9 ____________________________ (a) The balances as of December 31, 2020 exclude amounts classified as Liabilities associated with assets held for sale. Interest Rate Swap Agreements As of December 31, 2021, we had five interest rate swap agreements. In May 2021, we entered into a new interest rate swap agreement with a notional principal amount of $184.4 million which will reduce to $110.6 million at maturity. This swap, along with our existing swaps, was designed to provide a hedge against changes in variable rate cash flows regarding fluctuations in the one month LIBOR rate, through each swap's maturity date as noted in the table below. The following table provides information on the attributes of each swap as of December 31, 2021: Inception Date Notional Value at Inception Notional Value as of December 31, 2021 Notional Value at Maturity Maturity Date (In millions) May 2021 $ 184.4 $ 180.7 $ 110.6 May 2031 July 2020 $ 93.5 $ 86.6 $ 50.6 December 2028 July 2020 $ 85.5 $ 78.8 $ 57.3 November 2025 June 2015 $ 100.0 $ 69.3 $ 53.1 February 2025 November 2013 $ 75.0 $ 45.2 $ 38.7 September 2023 The fair value of cash flow swaps is calculated as the present value of expected future cash flows, determined on the basis of forward interest rates and present value factors. Fair value estimates reflect a credit adjustment to the discount rate applied to all expected cash flows under the swaps. Other than this input, all other inputs used in the valuation for these swaps are designated to be Level 2 fair values. The fair value of our swaps for the years ended December 31, 2021 and 2020, reflect a net liability of $0.9 million and $7.2 million, respectively. The following table provides information regarding the fair value of our interest rate swap agreements and the impact on the Consolidated Balance Sheets: As of December 31, 2021 2020 (In millions) Other current liabilities $ (3.8) $ (2.8) Other long-term assets 5.5 — Other long-term liabilities (2.6) (4.4) Total fair value $ (0.9) $ (7.2) Our interest rate swaps qualify for cash flow hedge accounting treatment. These interest rate swaps are marked to market at each reporting date and any unrealized gains or losses are included in accumulated other comprehensive income and reclassified to interest expense in the same period or periods during which the hedged transactions affect earnings. Information about the effect of our interest rate swap agreements in the accompanying Consolidated Statements of Income and Consolidated Statements of Comprehensive Income, is as follows (in millions): For the Year Ended December 31, Results Recognized in Accumulated Other Comprehensive Loss Location of Results Reclassified from Accumulated Other Comprehensive Loss to Earnings Results Reclassified from Accumulated Other Comprehensive Loss 2021 $ 11.0 Other interest expense, net $ 4.7 2020 $ (6.1) Other interest expense, net $ (2.5) 2019 $ (4.4) Other interest expense, net $ — On the basis of yield curve conditions as of December 31, 2021 and including assumptions about future changes in fair value, we expect the amount to be reclassified out of Accumulated other comprehensive loss into earnings within the next 12 months will be losses of $3.8 million. Investments The table below presents the Company’s investment securities that are measured at fair value on a recurring basis aggregated by the level in the fair value hierarchy within which those measurements fall: As of December 31, 2021 Level 1 Level 2 Level 3 Total (In millions) Cash equivalents $ 6.0 $ — $ — $ 6.0 Short-term investments 2.9 8.1 — 11.0 U.S Treasury 7.4 — — 7.4 Municipal — 28.2 — 28.2 Corporate — 9.5 — 9.5 Mortgage and other asset backed securities — 8.8 — 8.8 Total debt securities 10.3 54.6 — 64.9 Common stock 65.2 — — 65.2 Total $ 75.5 $ 54.6 $ — $ 130.1 Investments measured at net asset value (a) 4.4 Total Investments, at fair value $ 134.5 (a) In accordance with ASC 820-10, certain investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The NAV is based on the fair value of the underlying assets owned by the fund, minus its liabilities, divided by the number of units outstanding and is determined by the fund investment manager or custodian. Other investment securities measured at net asset value as a practical expedient in the amount of $4.4 million are excluded from the fair value leveling disclosure above. We do not have any significant restrictions on our ability to liquidate our |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income tax expense are as follows: For the Year Ended December 31, 2021 2020 2019 (In millions) Current: Federal $ 113.9 $ 64.5 $ 46.3 State 20.8 9.8 8.0 Total current income tax expense 134.7 74.3 54.3 Deferred: Federal 24.8 9.2 5.5 State 5.8 0.2 (0.3) Total deferred income tax expense 30.6 9.4 5.2 Total income tax expense $ 165.3 $ 83.7 $ 59.5 A reconciliation of the statutory federal rate to the effective tax rate is as follows (dollar amounts shown in millions) : For the Year Ended December 31, 2021 % 2020 % 2019 % Income tax provision at the statutory rate $ 146.5 21.0 $ 71.0 21.0 $ 51.2 21.0 State income tax expense, net of federal benefit 21.0 3.0 10.1 3.0 7.8 3.2 Non-deductible/non-tax items 0.6 0.1 1.3 0.4 0.6 0.2 Other, net (2.8) (0.4) 1.3 0.4 (0.1) — Income tax expense $ 165.3 23.7 $ 83.7 24.8 $ 59.5 24.4 Deferred income tax asset and liability components consisted of the following: As of December 31, 2021 2020 (In millions) Deferred income tax assets: Deferred Revenue $ 139.4 $ — F&I chargeback liabilities 11.9 $ 11.5 Other accrued liabilities 2.2 4.7 Stock-based compensation 2.7 2.3 Operating lease right-of-use assets 67.2 77.8 Other, net 10.6 10.2 Total deferred income tax assets $ 234.0 $ 106.5 Deferred income tax liabilities: Intangible asset amortization (42.4) (23.9) Depreciation (50.7) (39.2) Operating lease liabilities (65.6) (76.8) Investments, net (2.0) — Other, net (4.2) (1.2) Total deferred income tax liabilities $ (164.9) $ (141.1) Net deferred income tax liabilities $ 69.1 $ (34.6) There were no valuation allowances recorded against the deferred tax assets as of December 31, 2021 or 2020. As of December 31, 2021 and 2020, we had income taxes payable of $47.0 million and $25.0 million, respectively included in Accounts payable and Accrued liabilities. As of December 31, 2020, there was $2.1 million of unrecognized tax benefit. There was no unrecognized tax benefits as of December 31, 2021 or 2019. The statutes of limitation related to our consolidated Federal income tax returns are closed for all tax years up to and including 2017. The expiration of the statutes of limitation related to the various state income tax returns that we and our subsidiaries file varies by state. The 2014 through 2020 tax years generally remain subject to examination by most state tax authorities. We believe that our tax positions comply with applicable tax law and that we have adequately provided for these matters. |
OTHER LONG-TERM LIABILITIES
OTHER LONG-TERM LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
OTHER LONG-TERM LIABILITIES | OTHER LONG-TERM LIABILITIES Other long-term liabilities consisted of the following: As of December 31, 2021 2020 (In millions) Unearned premiums $ 24.0 $ — Accrued finance and insurance chargebacks 22.4 22.9 Unclaimed property 4.6 3.1 Interest rate swap 2.6 4.4 Deferred payroll tax — 9.1 Sale and leaseback liability — 7.0 Other 7.1 4.4 Other long-term liabilities $ 60.7 $ 50.9 |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
Supplemental Cash Flow Information [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATIONDuring the years ended December 31, 2021, 2020, and 2019, we made interest payments, including amounts capitalized, totaling $92.2 million, $62.6 million, and $91.2 million, respectively. Included in these interest payments are $8.7 million, $19.4 million, and $38.6 million, of floor plan interest payments for the years ended December 31, 2021, 2020, and 2019, respectively. During the years ended December 31, 2021, 2020, and 2019 we made income tax payments, net of refunds received, totaling $114.2 million, $48.6 million, and $48.4 million, respectively. During the years ended December 31, 2021, 2020, and 2019, we transferred $216.3 million, $163.5 million, and $141.0 million, respectively, of loaner vehicles from Other current assets to Inventory on our Consolidated Balance Sheets. The following items are included in Other adjustments, net to reconcile net income to net cash provided by operating activities: For the Year Ended December 31, 2021 2020 2019 (In millions) Amortization of debt issuance costs $ 2.6 $ 1.8 $ 2.5 (Gain) Loss on disposal of fixed assets (2.3) 0.7 2.6 Other individually immaterial items (1.1) (1.2) (0.3) Other adjustments, net $ (0.8) $ 1.3 $ 4.8 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
LEASES | LEASES We lease real estate and equipment primarily under operating lease agreements. For leases with terms in excess of 12 months, we record a right-of-use ("ROU") asset and lease liability based on the present value of lease payments over the lease term. Escalation clauses, lease payments dependent on existing rates/indexes, renewal options, and purchase options are included within the determination of lease payments when appropriate. We have elected the practical expedient not to separate lease and non-lease components for all leases that qualify, except for information technology assets that are embedded within service agreements (such as software license arrangements). Leases are classified as either finance or operating, with classification impacting the pattern of expense recognition in the income statement. When available, the implicit rate is utilized to discount lease payments to present value; however, substantially all of our leases do not provide a readily determinable implicit rate. Therefore, we estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. Balance Sheet Presentation As of December 31, Leases Classification 2021 2020 (In millions) Assets: Current Operating Assets held for sale 7.1 — Non-Current Operating Operating lease right-of-use assets $ 261.0 $ 317.4 Finance Property and equipment, net 8.4 14.6 Total right-of-use assets $ 276.5 $ 332.0 Liabilities: Current Operating Current maturities of operating leases $ 25.8 $ 24.8 Operating Liabilities held for sale 2.7 — Finance Current maturities of long-term debt — 16.6 Non-Current Operating Operating lease liabilities 242.0 296.7 Operating Liabilities held for sale 4.4 — Finance Long-term debt 8.4 — Total lease liabilities $ 283.3 $ 338.1 Lease Term and Discount Rate As of December 31, 2021 2020 Weighted Average Lease Term - Operating Leases 14.4 years 14.3 years Weighted Average Lease Term - Finance Lease 38.7 years 0.2 years Weighted Average Discount Rate - Operating Leases 4.5 % 4.5 % Weighted Average Discount Rate - Finance Lease 4.3 % 4.1 % Lease Costs The following table provides certain information related to the lease costs for finance and operating leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Finance lease cost (Interest) $ 0.4 $ 0.7 Operating lease cost 33.9 28.2 Short-term lease cost 1.1 1.5 Variable lease cost 2.5 2.4 $ 37.9 $ 32.8 Supplemental Cash Flow Information The following table presents supplemental cash flow information for leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Supplemental Cash Flow: Cash paid for amounts included in the measurements of lease liabilities Operating cash flows from finance lease $ 0.4 $ 0.7 Operating cash flows from operating leases $ 32.9 $ 27.6 Financing cash flows from finance lease $ 0.1 $ 0.6 Right-of-use assets obtained in exchange for new finance lease liabilities $ 8.4 $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ 69.2 $ 272.3 Changes to finance lease right-of-use asset resulting from lease reassessment event $ (14.6) $ — During the years ended December 31, 2021 and 2020, we obtained $69.2 million and $272.3 million, respectively, of right-of-use assets in exchange for new operating lease liabilities, primarily as a result of business combination acquisition transactions. During the twelve months ended December 31, 2021, we reassessed and remeasured an existing real estate lease, which was previously accounted for as a finance lease due to the presence of a purchase price option which we concluded we are no longer reasonably certain to exercise. The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities as of December 31, 2021, including leases related to liabilities associated with assets held for sale . Finance Operating (In millions) 2022 $ 0.4 $ 40.0 2023 0.4 36.6 2024 0.4 28.6 2025 0.4 26.1 2026 0.4 24.3 Thereafter 16.5 229.4 Total minimum lease payments $ 18.5 $ 385.0 Less: Amount of lease payments representing interest (10.1) (110.1) Present value of future minimum lease payments $ 8.4 $ 274.9 Less: current obligations under leases — (28.5) Long-term lease obligation $ 8.4 $ 246.4 |
LEASES | LEASES We lease real estate and equipment primarily under operating lease agreements. For leases with terms in excess of 12 months, we record a right-of-use ("ROU") asset and lease liability based on the present value of lease payments over the lease term. Escalation clauses, lease payments dependent on existing rates/indexes, renewal options, and purchase options are included within the determination of lease payments when appropriate. We have elected the practical expedient not to separate lease and non-lease components for all leases that qualify, except for information technology assets that are embedded within service agreements (such as software license arrangements). Leases are classified as either finance or operating, with classification impacting the pattern of expense recognition in the income statement. When available, the implicit rate is utilized to discount lease payments to present value; however, substantially all of our leases do not provide a readily determinable implicit rate. Therefore, we estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement. Balance Sheet Presentation As of December 31, Leases Classification 2021 2020 (In millions) Assets: Current Operating Assets held for sale 7.1 — Non-Current Operating Operating lease right-of-use assets $ 261.0 $ 317.4 Finance Property and equipment, net 8.4 14.6 Total right-of-use assets $ 276.5 $ 332.0 Liabilities: Current Operating Current maturities of operating leases $ 25.8 $ 24.8 Operating Liabilities held for sale 2.7 — Finance Current maturities of long-term debt — 16.6 Non-Current Operating Operating lease liabilities 242.0 296.7 Operating Liabilities held for sale 4.4 — Finance Long-term debt 8.4 — Total lease liabilities $ 283.3 $ 338.1 Lease Term and Discount Rate As of December 31, 2021 2020 Weighted Average Lease Term - Operating Leases 14.4 years 14.3 years Weighted Average Lease Term - Finance Lease 38.7 years 0.2 years Weighted Average Discount Rate - Operating Leases 4.5 % 4.5 % Weighted Average Discount Rate - Finance Lease 4.3 % 4.1 % Lease Costs The following table provides certain information related to the lease costs for finance and operating leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Finance lease cost (Interest) $ 0.4 $ 0.7 Operating lease cost 33.9 28.2 Short-term lease cost 1.1 1.5 Variable lease cost 2.5 2.4 $ 37.9 $ 32.8 Supplemental Cash Flow Information The following table presents supplemental cash flow information for leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Supplemental Cash Flow: Cash paid for amounts included in the measurements of lease liabilities Operating cash flows from finance lease $ 0.4 $ 0.7 Operating cash flows from operating leases $ 32.9 $ 27.6 Financing cash flows from finance lease $ 0.1 $ 0.6 Right-of-use assets obtained in exchange for new finance lease liabilities $ 8.4 $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ 69.2 $ 272.3 Changes to finance lease right-of-use asset resulting from lease reassessment event $ (14.6) $ — During the years ended December 31, 2021 and 2020, we obtained $69.2 million and $272.3 million, respectively, of right-of-use assets in exchange for new operating lease liabilities, primarily as a result of business combination acquisition transactions. During the twelve months ended December 31, 2021, we reassessed and remeasured an existing real estate lease, which was previously accounted for as a finance lease due to the presence of a purchase price option which we concluded we are no longer reasonably certain to exercise. The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities as of December 31, 2021, including leases related to liabilities associated with assets held for sale . Finance Operating (In millions) 2022 $ 0.4 $ 40.0 2023 0.4 36.6 2024 0.4 28.6 2025 0.4 26.1 2026 0.4 24.3 Thereafter 16.5 229.4 Total minimum lease payments $ 18.5 $ 385.0 Less: Amount of lease payments representing interest (10.1) (110.1) Present value of future minimum lease payments $ 8.4 $ 274.9 Less: current obligations under leases — (28.5) Long-term lease obligation $ 8.4 $ 246.4 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION As of December 31, 2021, the Company had two reportable segments: (1) Dealerships and (2) TCA. Prior to the acquisition of TCA in connection with the LHM Acquisition, we had one reportable segment whereby the geographic dealership groups were aggregated into one reportable segment. On December 17, 2021, we completed the LHM Acquisition by which we acquired 54 new vehicle dealerships, seven used car stores, 11 collision centers, a used vehicle wholesale business, the real property related thereto, and the entities comprising TCA. The dealerships acquired in the LHM Acquisition are located in Utah, Arizona, New Mexico, Colorado, Idaho, California and Washington. Our dealership operations are organized by management into geographic market-based groups within the Dealerships segment. The operations of our F&I product provider is reflected within our TCA segment. Our Chief Operating Decision Maker is our Chief Executive Officer who manages the business, regularly reviews financial information and allocates resources at the geographic market level for our dealerships and at the TCA segment level for our F&I product provider's operations. The geographic dealership group operating segments have been aggregated into one reportable segment as their operations (i) have similar economic characteristics (our markets all have similar long-term average gross margins), (ii) offer similar products and services (all of our markets offer new and used vehicles, parts and service, and finance and insurance products), (iii) have similar customers, (iv) have similar distribution and marketing practices (all of our markets distribute products and services through dealership facilities that market to customers in similar ways), and (v) operate under similar regulatory environments. Goodwill acquired in the LHM Acquisition of $929.0 million and $710.3 million was allocated to the Dealership and TCA segments, respectively, is consistent with how the Chief Operating Decision Maker reviews financial information and allocates resources. The allocation was based on the net assets acquired in the Dealership and TCA segments. This allocation is preliminary and subject to change once the purchase price allocation is finalized. The majority of TCA’s revenue arises from sales through our affiliated dealerships. Intercompany profits and losses are eliminated in consolidation. Reportable segment financial information for the year ended December 31, 2021, are as follows: As of and for the year ended December 31, 2021 Dealerships TCA Eliminations Total Company (In millions) Revenue $ 9,836.7 $ 12.0 $ (11.0) $ 9,837.7 Gross profit 1,901.7 5.5 (5.0) 1,902.2 Depreciation and amortization 41.9 — — 41.9 Selling, general and administrative expense 1,076.9 0.3 (3.3) 1,073.9 Interest expense Floor plan interest expense 8.2 — — 8.2 Other interest expense, net 93.9 — — 93.9 Total interest expense $ 102.1 $ — $ — $ 102.1 Capital expenditures 74.2 — — $ 74.2 Total Assets $ 7,289.7 $ 762.6 $ (49.7) $ 8,002.6 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Our dealerships are party to dealer and framework agreements with applicable vehicle manufacturers. In accordance with these agreements, each dealership has certain rights and is subject to restrictions typical in the industry. The ability of these manufacturers to influence the operations of the dealerships or the loss of any of these agreements could have a materially negative impact on our operating results. In some instances, manufacturers may have the right, and may direct us, to implement costly capital improvements to dealerships as a condition to entering into, renewing, or extending franchise agreements with them. Manufacturers also typically require that their franchises meet specific standards of appearance. These factors, either alone or in combination, could cause us to use our financial resources on capital projects that we might not have planned for or otherwise determined to undertake. From time to time, we and our dealerships are or may become involved in various claims relating to, and arising out of, our business and our operations. These claims may involve, but not be limited to, financial and other audits by vehicle manufacturers or lenders and certain federal, state, and local government authorities, which have historically related primarily to (i) incentive and warranty payments received from vehicle manufacturers, or allegations of violations of manufacturer agreements or policies, (ii) compliance with lender rules and covenants, and (iii) payments made to government authorities relating to federal, state, and local taxes, as well as compliance with other government regulations. Claims may also arise through litigation, government proceedings, and other dispute resolution processes. Such claims, including class actions, could relate to, but may not be limited to, the practice of charging administrative fees and other fees and commissions, employment-related matters, truth-in-lending and other dealer assisted financing obligations, contractual disputes, actions brought by governmental authorities, and other matters. We evaluate pending and threatened claims and establish loss contingency reserves based upon outcomes we currently believe to be probable and reasonably estimable. We believe we have adequately accrued for the potential impact of loss contingencies that are probable and reasonably estimable. Based on our review of the various types of claims currently known to us, there is no indication of material reasonably possible losses in excess of amounts accrued in the aggregate. We currently do not anticipate that any known claim will materially adversely affect our financial condition, liquidity, or results of operations. However, the outcome of any matter cannot be predicted with certainty, and an unfavorable resolution of one or more matters presently known or arising in the future could have a material adverse effect on our financial condition, liquidity, or results of operations. A significant portion of our business involves the sale of vehicles, parts, or vehicles composed of parts that are manufactured outside the United States. As a result, our operations are subject to customary risks of importing merchandise, including fluctuations in the relative values of currencies, import duties, exchange controls, trade restrictions, work stoppages, and general political and socio-economic conditions in foreign countries. The United States or the countries from which our products are imported may, from time to time, impose new quotas, duties, tariffs, or other restrictions; or adjust presently prevailing quotas, duties, or tariffs, which may affect our operations, and our ability to purchase imported vehicles and/or parts at reasonable prices. Substantially all of our facilities are subject to federal, state and local provisions regarding the discharge of materials into the environment. Compliance with these provisions has not had, nor do we expect such compliance to have, any material effect upon our capital expenditures, net earnings, financial condition, liquidity or competitive position. We believe that our current practices and procedures for the control and disposition of such materials comply with applicable federal, state, and local requirements. No assurances can be provided, however, that future laws or regulations, or changes in existing laws or regulations, would not require us to expend significant resources in order to comply therewith. We had $10.8 million of letters of credit outstanding as of December 31, 2021, which are required by certain of our insurance providers. In addition, as of December 31, 2021, we maintained a $14.5 million surety bond line in the ordinary course of our business. Our letters of credit and surety bond line are considered to be off balance sheet arrangements. Our other material commitments include (i) floor plan notes payable, (ii) operating leases, (iii) long-term debt and (iv) interest on long-term debt, as described elsewhere herein. |
SHARE-BASED COMPENSATION AND EM
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2021 | |
Compensation Related Costs [Abstract] | |
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS | SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS On March 13, 2012, our Board of Directors, upon the recommendation of our Compensation and Human Resources Committee, approved the 2012 Equity Incentive Plan (the "2012 Plan"). On April 18, 2012, our shareholders approved the 2012 Plan, which replaced our previous equity incentive plan. The 2012 Plan expires on March 13, 2022 and provides for the grant of options, performance share units, restricted share units, and shares of restricted stock to our directors, officers, and employees in the total amount of 1.5 million shares. On April 17, 2019, the stockholders of the Company approved the Asbury Automotive Group, Inc. 2019 Equity and Incentive Compensation Plan (the "2019 Plan") and authorized a total of 1,590,000 shares of common stock for issuance under the 2019 Plan ("Plan Shares"). The Plan Shares include 641,363 shares of common stock which remained unissued under the 2012 Plan. No further grants of awards will be made under the 2012 Plan; however outstanding awards under the 2012 Plan will continue in effect in accordance with their terms and conditions. There were approximately 1.5 million shares available for grant in accordance with the 2019 Plan as of December 31, 2021. We issue shares of our common stock upon the vesting of performance share units or restricted share units. These shares are issued from our authorized and not outstanding common stock. In addition, in connection with the vesting of equity based awards, we repurchase a portion of the shares issued equal to the amount of employee income tax withholding. We have recognized $16.2 million ($3.9 million tax benefit), $12.6 million ($3.2 million tax benefit), and $12.5 million ($3.1 million tax benefit) in share-based compensation expense for the years ended December 31, 2021, 2020, and 2019, respectively. As of December 31, 2021, there was $14.4 million of total unrecognized share-based compensation expense related to non-vested share-based awards granted under the 2012 Plan, and the weighted average period over which it is expected to be recognized is 1.65 years. Further, we expect to recognize $1.6 million of this expense in 2022, $7.7 million in 2023, $5.1 million in 2024. Performance Share Units During the year ended December 31, 2021, the Compensation and Human Resources Committee of the Board of Directors approved the grant of up to 80,922 performance share units, which represents 150% of the target award. Performance share units provide an opportunity for the employee-recipient to receive a number of shares of our common stock based on our performance during a specified year period following the grant as measured against objective performance goals as determined by the Compensation and Human Resources Committee of our Board of Directors. The actual number of units earned may range from 0% to 150% of the target number of units depending upon achievement of the performance goals. Performance share units vest in three three The following table summarizes information about performance share units for 2021: Shares Weighted Average Grant Date Non-vested at January 1, 2021 194,486 $ 82.70 Granted 80,922 132.52 Vested (79,582) 71.82 Forfeited or unearned (58,097) 95.32 Non-vested at December 31, 2021 137,729 $ 118.07 The weighted average grant-date fair value of performance share units and total fair value of performance share units vested are summarized in the following table: For the Year Ended December 31, 2021 2020 2019 Weighted average grant-date fair value of performance share units granted $ 132.52 $ 96.31 $ 69.67 Total fair value of performance share units vested (in millions) $ 5.7 $ 4.9 $ 6.0 Restricted Share Units During the year ended December 31, 2021, the Compensation and Human Resources Committee of the Board of Directors approved the grant of 72,732 shares of restricted share units. Restricted share units vest in three three The following table summarizes information about restricted share units for 2021: Shares Weighted Average Grant Date Non-vested at January 1, 2021 102,593 $ 93.97 Granted 72,732 150.38 Vested (38,818) 98.31 Forfeited (19,760) 107.00 Non-vested at December 31, 2021 116,747 125.33 The weighted average grant-date fair value of restricted share units and total fair value of restricted share units vested are summarized in the following table: For the Year Ended December 31, 2021 2020 2019 Weighted average grant-date fair value of restricted share units granted $ 150.38 $ 94.07 $ — Total fair value of restricted share units vested (in millions) $ 3.8 $ 0.3 $ — Restricted Stock Awards Restricted stock awards vest in three three The following table summarizes information about restricted stock awards for 2021: Shares Weighted Average Grant Non-vested at January 1, 2021 98,630 $ 68.66 Granted — — Vested (58,028) 147.83 Forfeited (2,067) 69.20 Non-vested at December 31, 2021 38,535 $ 68.61 The weighted average grant-date fair value of restricted stock awards and total fair value of restricted stock awards vested are summarized in the following table: For the Year Ended December 31, 2021 2020 2019 Weighted average grant-date fair value of restricted stock granted $ — $ — $ 69.18 Total fair value of restricted stock awards vested (in millions) $ 8.6 $ 5.1 $ 5.1 Employee Retirement Plan The Company sponsors the Asbury Automotive Retirement Savings Plan (the "Retirement Savings Plan"), a 401(k) plan, for eligible employees. Employees electing to participate in the Retirement Savings Plan may contribute up to 75% of their annual eligible compensation. IRS rules limited total participant contributions during 2021 to $19,500, or $26,000 if age 50 or more. For non-highly compensated employees, after one year of employment we match 50% of employees' contributions up to 4% of their eligible compensation. The Company's match was suspended during part of 2020 as a result of the economic uncertainty associated with the COVID-19 pandemic. Employer contributions vest on a graded basis over 4 years after the date of hire. The Company's expense related to employer matching contributions totaled $5.3 million, $2.5 million, and $3.7 million for the years ended December 31, 2021, 2020, and 2019, respectively. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS(OPEN) Potential Items - SOFR SWAP/ PLAZA LEXUS (OR LHM) DIVESTITURE(S) |
DESCRIPTION OF BUSINESS AND S_2
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and reflect the consolidated accounts of Asbury Automotive Group, Inc. and our wholly owned subsidiaries. All intercompany transactions have been eliminated in consolidation. If necessary, reclassifications of amounts previously reported have been made to the accompanying Consolidated Financial Statements in order to conform to current presentation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the periods presented. Actual results could differ materially from these estimates. Estimates and assumptions are reviewed quarterly, and the effects of any revisions are |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include investments in money market accounts and short-term certificates of deposit, which have maturity dates of less than 90 days when purchased. |
Restricted Cash and Securities | Restricted Cash and Securities TCA places securities on statutory deposit with certain state agencies to retain the right to do business in those states. Securities held on deposit with various state regulatory authorities had a fair value of $2.5 million at December 31, 2021. |
Investments | Short-Term Investments Short-term investments consist of debt securities that are callable or have a maturity date within the next 12 months and are classified as current assets. Debt securities classified as short-term investments are designated as available-for-sale as management intends to hold these securities for indefinite periods of time or may sell the securities in response to changes in interest rates, prepayments, or other similar factors. Available-for-sale debt securities are reported at fair market value with any unrealized gain or loss, net of applicable income tax, reported in other comprehensive income, as a separate component of shareholders’ equity. Premiums and discounts on debt securities classified as short-term investments are amortized or accreted using the effective interest method over the period from the purchase date to the expected maturity or call date of the related security and are reported in net income. Investments Investments consist of available-for-sale debt securities, equity securities, and other investments. These securities are classified as non-current investments as they are not intended to fund current operations or have stated call dates or maturity dates beyond the next 12 months. Equity securities may consist of both preferred stock and common stock. Other investments consist of hedge funds and partnerships. Debt securities classified as non-current investments are designated as available-for-sale as management intends to hold these securities for indefinite periods of time or may sell the securities in response to changes in interest rates, prepayments, or other similar factors. Available-for-sale debt securities included in non-current investments are reported at fair market value with any unrealized gain or loss, net of applicable income tax, reported in other comprehensive income, as a separate component of shareholders’ equity. Premiums and discounts on debt securities included in non-current investments are amortized or accreted, as applicable, using the effective interest method over the period from the purchase date to the expected maturity or call date of the related security and are reported in net income. Equity securities included in non-current investments are reported at fair market value with the change in value recognized in net income. Other investments are measured at net asset value as a practical expedient with the net change in net asset value recognized in net income. |
Contracts-In-Transit | Contracts-In-Transit Contracts-in-transit represent receivables from third-party finance companies for the portion of new and used vehicle purchase price financed by customers through sources arranged by us. |
Inventories | Inventories Inventories are stated at the lower of cost and net realizable value. We use the specific identification method to value vehicle inventories and parts and accessories are valued at the lower of cost or net realizable value. Our new vehicle sales history indicates that the vast majority of the new vehicles we sell are sold for, or in excess of, our cost to purchase those vehicles. Therefore, we generally do not maintain a reserve for new vehicle inventory. We maintain a reserve for used vehicle inventory where cost basis exceeds net realizable value. In assessing lower of cost and net realizable value for used vehicles, we consider (i) the aging of our used vehicles, (ii) historical sales experience of used vehicles, and (iii) current market conditions and trends in used vehicle sales. We also review and consider the following metrics related to used vehicle sales (both on a recent and longer-term historical basis): (i) days of supply in our used vehicle inventory, (ii) used vehicle units sold at less than original cost as a percentage of total used vehicles sold, and (iii) average vehicle selling price of used vehicle units sold at less than original cost. We then determine the appropriate level of reserve required to reduce our used vehicle inventory to the lower of cost and net realizable value, and record the resulting adjustment in the period in which we determine a loss has occurred. The level of reserve determined to be appropriate for each reporting period is considered to be a permanent inventory write-down, and therefore is only released upon the sale of the related inventory. We receive assistance from certain automobile manufacturers in the form of advertising and floor plan interest credits. Manufacturer advertising credits that are reimbursements of costs associated with specific advertising programs are recognized as a reduction of advertising expense in the period they are earned. All other manufacturer advertising and floor plan interest credits are accounted for as purchase discounts, and are recorded as a reduction of inventory and recognized as a reduction to New vehicle cost of sales in the accompanying Consolidated Statements of Income in the period the related vehicle is sold. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives. Depreciation is included in Depreciation and amortization on the accompanying Consolidated Statements of Income. Leasehold improvements are capitalized and amortized over the lesser of the remaining lease term or the useful life of the related asset. The ranges of estimated useful lives are as follows (in years): Buildings and improvements 10-40 Machinery and equipment 5-10 Furniture and fixtures 3-10 Company vehicles 3-5 Expenditures for major additions or improvements, which extend the useful lives of assets, are capitalized. Minor replacements, maintenance and repairs, which do not improve or extend the lives of such assets, are expensed as incurred. We capitalize interest on borrowings during the active construction period of capital projects. Capitalized interest is added to the cost of the assets and is depreciated over the estimated useful lives of the assets. We review property and equipment for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable. When we test our long-lived assets for impairment, we first compare the carrying amount of the underlying assets to their net recoverable value by reviewing the undiscounted cash flows expected from the use and eventual disposition of the underlying assets. If the carrying amount of the underlying assets is less than their net recoverable value, then we calculate an impairment equal to the excess of the carrying amount over the fair market value, and the impairment loss would be charged to operations in the period identified. During the year ended December 31, 2020, we recorded a $0.7 million impairment related to a vacant property. We did not record an impairment of our property and equipment in 2021 and 2019. |
Acquisitions | Acquisitions Acquisitions are accounted for under the acquisition method of accounting and the assets acquired and liabilities assumed are recorded at their fair value at the acquisition date. The results of operations of acquired dealerships and other businesses are included in the accompanying Consolidated Statements of Income, commencing on the date of acquisition. |
Goodwill and Other Intangible Assets | Goodwill and Franchise Rights Goodwill represents the excess cost of an acquired business over the estimated fair market value of its identifiable net assets. We have determined that, based on how we integrate acquisitions into our business, how the components of our business share resources and interact with one another, and how we review the results of our operations, that we have several geographic market-based operating segments which consist of our dealerships. We have determined that the dealerships in each of our operating segments are components that are aggregated into several geographic market-based reporting units for the purpose of testing goodwill for impairment, as they (i) have similar economic characteristics, (ii) offer similar products and services (all of our dealerships offer new and used vehicles, service, parts and third-party finance and insurance products), (iii) have similar customers, (iv) have similar distribution and marketing practices (all of our dealerships distribute products and services through dealership facilities that market to customers in similar ways), and (v) operate under similar regulatory environments. Our dealership operating segments are aggregated into our single dealerships reportable segment. Goodwill associated with TCA will be tested annually for impairment at the operating segment level which is the same as the reporting unit for this business. In December 2021, we completed the LHM Acquisition which included 54 new vehicle dealerships, seven used car stores, 11 collision centers, a used vehicle wholesale business, the real property related thereto (Dealerships segment), and the entities comprising TCA. We have determined that the operations of TCA comprise a separate operating and reportable segment to that of our dealerships operations and have therefore allocated goodwill of $1.64 billion associated with the LHM Acquisition to each of our reportable segments. Approximately $710.3 million of goodwill was allocated to the TCA segment and $929.0 million was allocated to the Dealerships segment. This allocation is preliminary and subject to change once the purchase price allocation is finalized. The fair value of our manufacturer franchise rights are determined as of the acquisition date, by discounting the projected cash flows specific to each franchise. We have determined that manufacturer franchise rights have an indefinite life, as there are no economic, contractual or other factors that limit their useful lives, and they are expected to generate cash flows indefinitely due to the historically long lives of the manufacturers' brand names. Furthermore, to the extent that any agreements evidencing our manufacturer franchise rights would expire, we expect that we would be able to renew those agreements in the ordinary course of business. Goodwill and manufacturer franchise rights are deemed to have indefinite lives and therefore are not subject to amortization. We review goodwill and manufacturer franchise rights for impairment annually as of October 1 st , or more often if events or circumstances indicate that impairment may have occurred. We are subject to financial statement risk to the extent that goodwill becomes impaired due to decreases in the fair value of our automotive retail business or manufacturer franchise rights become impaired due to decreases in the fair value of our individual franchises. Our identifiable intangible assets, other than goodwill, are our rights under franchise agreements with manufacturers, which are recorded at an individual franchise level, and the value of business acquired ("VOBA") which is recorded at the TCA operating unit level. We recorded VOBA of $5.6 million in connection with the acquisition of TCA. VOBA reflects the estimated fair value of the expected future profits in unearned premium for in-force service contracts acquired in the LHM Acquisition. VOBA is based on actuarially determined projections, by each type of service contract, of future charges, premiums, claims, operating expenses, investment returns and other factors. VOBA is reflected in Other long-term assets within the Consolidated Balance Sheets and is amortized over the period of the underlying contracts. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs are presented as a contra-liability within Current maturities of long-term debt or Long-term debt on our Consolidated Balance Sheets, except for debt issuance costs associated with our line-of-credit arrangements, which are presented as an asset within Other current assets or Other long-term assets on our Consolidated Balance Sheets. Debt issuance costs are amortized to Floor plan interest expense and Other interest expense, net in the accompanying Consolidated Statements of Income through maturity using the effective interest method or the straight-line method for our line-of-credit arrangements. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities From time to time, we utilize derivative financial instruments to manage our interest rate risk. The types of risks hedged are those relating to the variability of cash flows caused by fluctuations in interest rates. We document our risk management strategy and assess hedge effectiveness at each interest rate swap's inception and during the term of each hedge. Derivatives are reported at fair value on the accompanying Consolidated Balance Sheets. The changes in fair value on our hedges is reported as a component of Accumulated Other Comprehensive Loss on the accompanying Consolidated Balance Sheets, and reclassified to Other interest expense, net in the accompanying Consolidated Statements of Income in the period during which the hedged transaction affects earnings. |
Self-insurance Programs | Self-insurance Programs We are self-insured for employee medical claims and maintain stop-loss insurance for large-dollar individual claims. We have high deductible insurance programs for workers compensation, property and general liability claims. We maintain and review our claim and loss history to assist in assessing our expected future liability for these claims. We also use professional service providers, such as account administrators and actuaries, to help us accumulate and assess this information. Provisions for retained losses and deductibles are made by charges to expense based upon periodic evaluations of the estimated ultimate liabilities on reported and unreported claims. |
Revenue Recognition | Revenue Recognition We recognize revenue in accordance with ASC 606, Revenue from Contracts with Customers (Topic 606). Under that guidance, the transaction price is attributed to the underlying performance obligations in the contract and revenue is deferred and recognized as income as the Company satisfies the performance obligations in the contract and as the obligations under the contracts are performed. Incremental costs of obtaining a contract are capitalized and amortized to the extent that the Company expects to recover those costs. The Company satisfies performance obligations either over time or at a point in time as discussed in further detail below. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised good or performing a service to a customer. Sales and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. New vehicle and used vehicle retail Revenue from the sale of new and used vehicles is recognized when the terms of the customer contract are satisfied which generally occurs with the signing of the sales contract and transfer of control of the vehicle to the customer. Payment is generally received at the time of sale or from a third-party financial institution within a short period of time following the sale of the vehicle. Amounts due from third-party financial institutions are reflected in Contracts-in-transit or vehicle receivables within Accounts receivable, net on our Consolidated Balance Sheets. Costs associated with incidental items that are immaterial in the context of the contract are accrued at the time of sale. Used vehicle wholesale Proceeds from the sale of these vehicles are recognized in used vehicle revenue upon transfer of control to end-users at auction. Sale of vehicle parts and accessories The Company recognizes revenue upon transfer of control to the customer which occurs at a point in time. Payment is typically received when control of the parts and accessories transfers to the customer or within 30 days of such time. When the Company performs shipping and handling activities after the transfer of control to the customer (e.g., when control transfers prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued when the related revenue is recognized. Vehicle repair and maintenance services The Company provides vehicle repair and maintenance services to its customers pursuant to the terms and conditions included within the customer contract ("repair order"). Payment for services are typically received upon completion of the services or within 30 days following the completion of the services. Certain of these services are provided by the Dealerships segment to TCA customers in connection with claims related to TCA's vehicle protection products. Revenues recorded by the Dealerships segment and the associated claims expenses recorded by the TCA segment are eliminated upon consolidation. Satisfaction of this performance obligation creates an asset with no alternative use for which an enforceable right to payment for performance to date exists within our contractual agreements. As such, the Company recognizes revenue over time as the Company satisfies its performance obligation. Additionally, the Company has determined that parts and labor are not individually distinct in the context of a repair order and therefore treated as a single performance obligation. Finance and insurance, net Within the Dealership segment, we receive commissions from third-party lending and insurance institutions for arranging customer financing and from the sale of vehicle service contracts, guaranteed asset protection debt cancellation, and other products, to end-users. In addition, we record commissions received from our TCA segment related to the sale of TCA's various vehicle protection F&I products. Finance and insurance commission revenue is recognized at the point of sale since our performance obligation is to arrange financing or facilitating the sale of a third party's products or services to our customers. The dealerships commission arrangements with TCA, third-party lenders and insurance administrators consists of fixed ("upfront") and variable consideration. Variable consideration includes commission chargebacks ("chargebacks") in the event a contract is prepaid, defaulted upon, or terminated by the end-user. The Company reserves for future chargebacks based on historical chargeback experience and the termination provisions of the applicable contract, and these reserves are established in the same period that the related revenue is recognized. Commissions revenue and related reserves for future chargebacks in connection with the sale of TCA F&I products by our dealerships, are eliminated in consolidation. We also participate in future profits pursuant to retrospective commission arrangements, which meet the definition of variable consideration, for certain insurance products associated with a third-party portfolio. The Company estimates the amount of variable consideration to be included in the transaction price based on historical payment trends and further constrains the variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur. In making these assessments the Company considers the likelihood and magnitude of a potential reversal of revenue and updates its assessment when uncertainties associated with the constraint are removed. Within our TCA segment, all revenue other than investment and interest income is the result of contracts with customers. Each contract is considered to have a single performance obligation which extends over the life of the contract. Revenue is recognized over the contract term in proportion to the amount of insurance protection provided. Expenses are matched with earned premiums resulting in recognition of profits over the life of the contracts. These expenses include the incremental costs incurred, primarily in the form of commissions, to obtain the contracts with customers. These commissions are primarily paid to affiliated dealerships and are therefore eliminated upon consolidation. Unearned premium reserves are established to cover the unexpired portion of premiums written. Deferred Revenue We earn and recognize premium revenue related to the TCA segment over the period of the related service contract. Accordingly, we record deferred revenue as we ratably recognize revenue over the service contract period. Unpaid Losses and Loss Adjustment Expense Reserve Losses and loss adjustment expense reserves represent management's best estimate of the ultimate net cost of all reported and unreported losses incurred through December 31, 2021. The Company does not discount liabilities for unpaid losses or unpaid loss adjustment expense reserves. The reserves for unpaid losses and loss adjustment expenses are estimated using individual case-basis valuation and statistical analysis. Those estimates are subject to the effects of trends in loss severity and frequency. Although considerable variability is inherent in such estimates, management believes the reserves for losses and loss adjustment expenses are adequate. The estimates are continually reviewed and adjusted as necessary as experience develops or new information becomes known; such adjustments are included in income from operations. Claims are counted when incidents that may result in a liability are reported and are based on policy coverage. |
Consolidation | Internal Profit Revenues and expenses associated with internal work performed by our parts and service departments on new and used vehicle inventory are eliminated in consolidation. The gross profit earned by our parts and service departments for internal work performed is included as a reduction of Parts and service cost of sales on the accompanying Consolidated Statements of Income upon the sale of the vehicle. The costs incurred by our new and used vehicle departments for work performed by our parts and service departments is included in either New vehicle cost of sales or Used vehicle cost of sales on the accompanying Consolidated Statements of Income, depending on the classification of the vehicle serviced. We eliminate the internal profit on vehicles that remain in inventory. Intersegment Elimination |
Share-based Compensation | Share-Based CompensationWe record share-based compensation expense under the fair value method on a straight-line basis over the vesting period, unless the awards are subject to performance conditions, in which case we recognize the expense over the requisite service period of each separate vesting tranche. In addition, we account for the forfeiture of share-based awards as they occur. |
Share Repurchase | Share Repurchases Share repurchases may be made from time-to-time in open market transactions or through privately negotiated transactions under the authorization approved by the Board of Directors. Periodically, the Company may retire repurchased shares of common stock previously held by the Company as treasury stock. In accordance with our accounting policy, we allocate any excess share repurchase price over par value between additional paid-in capital, which is limited to amounts initially recorded |
Earnings per Common Share | Earnings per Common Share Basic earnings per common share is computed by dividing net income by the weighted-average common shares outstanding during the period. Diluted earnings per common share is computed by dividing net income by the weighted-average common shares and common share equivalents outstanding during the period. For all periods presented, there were no adjustments to the numerator necessary to compute diluted earnings per share. |
Advertising | Advertising We expense costs of advertising as incurred and production costs when the advertising initially takes place, net of certain advertising credits and other discounts received from certain automobile manufacturers. Advertising expense totaled $30.7 million, $25.5 million and $34.4 million for the years ended December 31, 2021, 2020 and 2019, which was net of earned advertising credits of $22.4 million, $19.6 million, and $21.1 million, respectively, and is included in Selling, general, and administrative expense in the accompanying Consolidated Statements of Income. |
Income Taxes | Income TaxesWe use the liability method to account for income taxes. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax basis using currently enacted tax rates. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all the deferred tax assets will not be realized. |
Assets Held for Sale and Liabilities Associated with Assets Held for Sale | Assets Held for Sale and Liabilities Associated with Assets Held for Sale Certain amounts have been classified as Assets held for sale as of December 31, 2021 and 2020 in the accompanying Consolidated Balance Sheets. Assets and liabilities classified as held for sale include assets and liabilities associated with pending dealership disposals, real estate we are actively marketing to sell, and any related mortgage notes payable or other liabilities, if applicable. At the time of classifying assets as held for sale, we compare the carrying value of these assets to estimates of fair value to assess for impairment. We compare the carrying value to estimates of fair value utilizing the assistance of third-party broker opinions of value and third-party desktop appraisals to assist in our fair value estimates related to real estate properties. Classification as held for sale begins on the date that we have met all of the criteria for classification as held for sale. |
Statements of Cash Flows | Statements of Cash Flows Borrowings and repayments of floor plan notes payable through our 2019 Senior Credit Facility ("Non-Trade"), and all floor plan notes payable relating to used vehicles (together referred to as "Floor Plan Notes Payable—Non-Trade"), are classified as financing activities on the accompanying Consolidated Statements of Cash Flows, with borrowings reflected separately from repayments. The net change in floor plan notes payable to a lender affiliated with the manufacturer from which we purchase a particular new vehicle (collectively referred to as "Floor Plan Notes Payable—Trade") is classified as an operating activity on the accompanying Consolidated Statements of Cash Flows. Borrowings of floor plan notes payable associated with inventory acquired in connection with all acquisitions and repayments made in connection with all divestitures are classified as a financing activity in the accompanying Consolidated Statement of Cash Flows. Cash flows related to floor plan notes payable included in operating activities differ from cash flows related to floor plan notes payable included in financing activities only to the extent that the former are payable to a lender affiliated with the manufacturer from which we purchased the related inventory, while the latter are payable to our 2019 Senior Credit Facility that includes lenders affiliated with the manufacturers and lenders not affiliated with the manufacturers from which we purchased the related inventory. The majority of our floor plan notes are payable to our 2019 Senior Credit Facility, with the exception of floor plan notes payable relating to the financing of new Ford and Lincoln vehicles. Loaner vehicles account for a significant portion of Other current assets. We acquire loaner vehicles either with available cash or through borrowings from either our manufacturer affiliated lenders or through our senior secured credit agreement with Bank of America, as administrative agent, and the other agents and lenders party thereto (as amended, the "2019 Senior Credit Facility"). Loaner vehicles are initially used by our service department for only a short period of time (typically 6 to 12 months) before we seek to sell them. Therefore, we classify the acquisition of loaner vehicles in Other current assets and the borrowings and repayments of loaner vehicle notes payable in Accounts payable and accrued liabilities in the accompanying Consolidated Statements of Cash Flows. Loaner vehicles are depreciated over the service period to their estimated value. At the end of the |
Business and Credit Concentration Risk | Business and Credit Concentration Risk Financial instruments, which potentially subject us to a concentration of credit risk, consist principally of cash deposits and investments. We maintain cash balances at financial institutions with strong credit ratings. Generally, amounts maintained with these financial institutions are in excess of FDIC insurance limits. In addition, we maintain a diverse investment portfolio across various asset categories and limit our exposure through the kind, quality and concentration of these investments. As of December 31, 2021, the Company had total investments of $134.5 million. We have substantial debt service obligations. As of December 31, 2021, we had total debt of $3.61 billion, which excludes floor plan notes payable, debt issuance costs, and the debt premium on the 4.5% Senior Notes (the "4.5% Notes") and 4.75% Senior Notes (the "4.75% Notes") due 2028 and 2030, respectively. In addition, we and our subsidiaries have the ability to obtain additional debt from time to time to finance acquisitions, real property purchases, capital expenditures, share repurchases or for other purposes, although such borrowings are subject to the restrictions contained in the third amended and restated senior secured credit agreement with Bank of America, N.A. ("Bank of America"), as administrative agent, and the other lenders party thereto (the "2019 Senior Credit Facility"), the indentures governing our 4.5% Notes, 4.625% Notes, 4.75% Notes and 5.0% Notes (the "Indentures"), and our other debt instruments. We will have substantial debt service obligations, consisting of required cash payments of principal and interest, for the foreseeable future. We are subject to operating and financial restrictions and covenants in certain of our leases and in our debt instruments, including the 2019 Senior Credit Facility, the Indentures, and the credit agreements covering our mortgage obligations. These agreements contain restrictions on, among other things, our ability to incur additional indebtedness, to create liens or other encumbrances, and to make certain payments (including dividends and repurchases of our shares and investments). These agreements may also require us to maintain compliance with certain financial and other ratios. Our failure to comply with any of these covenants in the future would constitute a default under the relevant agreement, which would, depending on the relevant agreement, (i) entitle the creditors under such agreement to terminate our ability to borrow under the relevant agreement and accelerate our obligations to repay outstanding borrowings; (ii) require us to apply our available cash to repay these borrowings; (iii) entitle the creditors under such agreement to foreclose on the property securing the relevant indebtedness; and/or (iv) prevent us from making debt service payments on certain of our other indebtedness, any of which would have a material adverse effect on our business, financial condition or results of operations. In many cases, a default under one of our debt or mortgage agreements could trigger cross-default provisions in one or more of our other debt or mortgages. A number of our dealerships are located on properties that we lease. Each of the leases governing such properties has certain covenants with which we must comply. If we fail to comply with the covenants under our leases, the respective landlords could terminate the leases and seek damages from us. Concentrations of credit risk with respect to contracts-in-transit and accounts receivable are limited primarily to automotive manufacturers and financial institutions. Credit risk arising from receivables with commercial customers is minimal due to the large number of customers comprising our customer base. A significant portion of our new vehicle sales are derived from a limited number of automotive manufacturers. For the year ended December 31, 2021, manufacturers representing 5% or more of our revenues from new vehicle sales were as follows: Manufacturer (Vehicle Brands): % of Total Toyota Motor Sales, U.S.A., Inc. (Toyota and Lexus) 24 % American Honda Motor Co., Inc. (Honda and Acura) 19 % Mercedes-Benz USA, LLC ( Mercedes-Benz and Sprinter ) 13 % Ford Motor Company (Ford and Lincoln) 7 % Nissan North America, Inc. (Nissan and Infiniti) 5 % BMW of North America, LLC (BMW and MINI) 5 % |
Segment Reporting | Segment ReportingAs of December 31, 2021, the Company had two reportable segments: (1) Dealerships; and (2) TCA. Prior to the acquisition of TCA as part of the LHM Acquisition, we had one reportable segment as the geographic dealership groups are aggregated into one reportable segment. Segment information is discussed further in Note 20 "Segment Information". |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Effective October 1, 2021, the Company adopted Financial Accounting Standard Board Accounting Standards Update 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires an acquiring entity to apply ASC Topic 606 to recognize and measure contract assets acquired and contract liabilities assumed in a business combination. The Company applied ASC Topic 606 in recording contract assets acquired and contract liabilities assumed in business combinations that occurred in the quarter ended December 31, 2021. We assumed contract liabilities or deferred revenue of $644.3 million in connection with the LHM Acquisition which closed in December 2021. In March 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04"). In January 2021, the FASB issued Accounting Standards Update No. 2021-01, Reference Rate Reform (Topic 848): Scope, which clarified the scope and application of the original guidance. The guidance in these standards apply to contract accounting, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met, and provides optional expedients and exceptions for a limited time to ease the potential burden in accounting for reference rate reform. The amendments apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. ASU 2020-04 is effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2022. LIBOR benchmarking is utilized in our debt (including mortgages), revolving credit facilities, floorplan facilities, and interest rate swaps. We are in the process of amending our LIBOR-based debt arrangements and related hedging to revise their interest basis from LIBOR to a Secured Overnight Financing Rate ("SOFR"). The impact of these proposed amendments to our debt arrangements along with the adoption of the provisions from this standard is not anticipated to have a material impact on our Consolidated Financial Statements. Effective January 1, 2020, the Company adopted Financial Accounting Standard Board Accounting Standards Update 2016-13, Measurement of Credit Losses on Financial Instruments , which changed the way entities assess the impairment of its financial instruments based on its estimate of expected credit losses versus the current incurred loss model. The adoption of this standard did not have a material impact on our Consolidated Financial Statements. Effective January 1, 2019, the Company adopted the new lease accounting guidance in Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (“ASC 842”). For additional information, please refer to Note 19 "Leases" within the accompanying Notes to Consolidated Financial Statements for additional information. Effective January 1, 2019, the Company adopted ASU No. 2018-02, "Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income ("ASU 2018-02")." ASU 2018-02 allows entities to elect to reclassify the income tax effects resulting from the Tax Cuts and Jobs Act on items within accumulated other comprehensive income to retained earnings. The Company elected to reclassify $0.2 million related to the change in deferred taxes associated with our cash flow hedges from accumulated other comprehensive income to retained earnings. This reclassification was recognized as a cumulative effect adjustment in the Consolidated Statements of Shareholders' Equity. On January 1, 2019, the Company adopted ASU No. 2017-12, "Derivatives and Hedging" (Topic 815): Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"). This update intended to simplify hedge accounting by better aligning how an entity's risk management activities and hedging relationships are presented in its financial statements and simplifies the application of hedge accounting guidance in certain situations. This update 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. For cash flow hedges existing at the adoption date, this update required adoption on a modified retrospective basis with a cumulative-effect adjustment to retained earnings as of the effective date and the amendments to presentation guidance and disclosure requirements were required to be adopted prospectively. The adoption of this update did not have a material impact on our Consolidated Financial Statements. |
DESCRIPTION OF BUSINESS AND S_3
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives | The ranges of estimated useful lives are as follows (in years): Buildings and improvements 10-40 Machinery and equipment 5-10 Furniture and fixtures 3-10 Company vehicles 3-5 Property and equipment, net consisted of the following: As of December 31, 2021 2020 (In millions) Land $ 704.3 $ 350.5 Buildings and leasehold improvements 1,338.5 691.6 Machinery and equipment 128.8 107.4 Furniture and fixtures 87.3 72.9 Company vehicles 12.1 9.5 Construction in progress 46.9 19.9 Gross property and equipment 2,317.9 1,251.8 Less—Accumulated depreciation (327.9) (295.6) Property and equipment, net (a) $ 1,990.0 $ 956.2 ______________________________ |
Schedule of Revenue by Major Brand | For the year ended December 31, 2021, manufacturers representing 5% or more of our revenues from new vehicle sales were as follows: Manufacturer (Vehicle Brands): % of Total Toyota Motor Sales, U.S.A., Inc. (Toyota and Lexus) 24 % American Honda Motor Co., Inc. (Honda and Acura) 19 % Mercedes-Benz USA, LLC ( Mercedes-Benz and Sprinter ) 13 % Ford Motor Company (Ford and Lincoln) 7 % Nissan North America, Inc. (Nissan and Infiniti) 5 % BMW of North America, LLC (BMW and MINI) 5 % |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Revenue from contracts with customers consists of the following: For the year ended December 31, 2021 2020 2019 (In million) Revenue: New vehicle $ 4,934.1 $ 3,767.4 $ 3,863.3 Used vehicle retail 3,055.9 1,930.0 1,941.3 Used vehicle wholesale 259.7 239.5 190.3 New and used vehicle 8,249.7 5,936.9 5,994.9 Sale of vehicle parts and accessories 212.0 140.1 148.8 Vehicle repair and maintenance services 970.9 749.7 750.6 Parts and services 1,182.9 889.8 899.4 Finance and insurance, net 405.1 305.1 316.0 Total revenue $ 9,837.7 $ 7,131.8 $ 7,210.3 |
Schedule of Contract with Customer, Assets | Changes in contract assets during the period are reflected in the table below. Contract assets related to vehicle repair and maintenance services are transferred to receivables when a repair order is completed and invoiced to the customer. Certain incremental sales commissions payable to obtain an F&I revenue contract with a customer have been capitalized and are amortized using the same pattern of recognition applicable to the associated F&I revenue contract. Vehicle Repair and Maintenance Services Finance and Insurance, net Deferred Sales Commissions Total (In millions) Contract Assets (Current), December 31, 2019 $ 4.8 $ 12.3 $ — $ 17.1 Transferred to receivables from contract assets recognized at the beginning of the period (4.8) (12.3) — (17.1) Increases related to revenue recognized, inclusive of adjustments to constraint, during the period 7.1 13.3 20.4 Contract Assets (Current), December 31, 2020 7.1 13.3 — 20.4 Transferred to receivables from contract assets recognized at the beginning of the period (7.1) (14.7) — (21.8) Increases related to revenue recognized, inclusive of adjustments to constraint, during the period 12.3 14.9 1.4 28.6 Contract Assets (Current), December 31, 2021 $ 12.3 $ 13.5 $ 1.4 $ 27.2 The Company acquired $644.3 million in Deferred revenue as part of the LHM Acquisition in December 2021. As of December 31, 2021, we had $647.8 million of Deferred revenue reflected in the Consolidated Balance Sheet. |
ACQUISITIONS AND DIVESTITURES (
ACQUISITIONS AND DIVESTITURES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions | The sources of the preliminary purchase consideration are as follows: (In millions) Cash, net of cash acquired $ 195.0 Common stock offering 666.9 Senior notes 1,578.5 Real estate facility 513.0 New vehicle floor plan facility 183.5 Used vehicle floor plan facility 51.0 Payable to sellers 6.0 Preliminary purchase price, net of cash acquired $ 3,193.9 (In millions) Summary of Assets Acquired and Liabilities Assumed Cash and cash equivalents $ 287.4 Investments 133.5 Contracts-in-transit, net 99.5 Accounts receivable, net 110.0 Inventories, net 285.0 Other current assets 25.4 Total current assets 940.8 Property and equipment, net 792.6 Goodwill 1,639.3 Intangible franchise rights 870.0 Operating lease right-of-use assets 34.1 Deferred income taxes 136.5 Other long-term assets 5.6 Total assets acquired 4,418.9 Accounts payable and accrued liabilities 234.0 Operating lease liabilities 34.1 Deferred revenue 644.3 Other long-term liabilities 25.2 Total liabilities assumed 937.6 Net assets acquired $ 3,481.3 The sources of the purchase consideration are as follows: (In millions) Cash $ 527.4 Seller notes 200.0 New vehicle floor plan facility 127.5 Used vehicle floor plan facility 35.0 Purchase price $ 889.9 (In millions) Summary of Assets Acquired and Liabilities Assumed Inventories $ 120.8 Loaner vehicles 57.0 Property and equipment 36.5 Goodwill 360.4 Manufacturer franchise rights 324.0 Operating lease right-of-use assets 202.7 Total assets acquired 1,101.4 Operating lease liabilities (202.2) Other liabilities (9.3) Total liabilities assumed (211.5) Net assets acquired $ 889.9 For the Year Ended December 31, 2021 2020 (In millions) Inventory $ 38.3 $ 29.8 Real estate 99.9 14.5 Property and equipment 4.4 0.4 Goodwill 187.2 5.4 Manufacturer franchise rights 150.5 13.8 Loaner vehicles 8.9 — Other (3.5) (0.3) Total purchase price $ 485.7 $ 63.6 |
Schedule of Pro Forma Information | The following represents the unaudited pro forma information as if LHM had been included in the consolidated results of the Company since January 1, 2020: For the Year Ended December 31, 2021 2020 (In millions) (Unaudited) Pro forma revenue $ 15,431.5 $ 12,927.3 Pro forma net income $ 777.3 $ 359.9 The following represents the unaudited pro forma information as if Park Place had been included in the consolidated results of the Company since January 1, 2019: For the Year Ended December 31, 2020 2019 (In millions) (Unaudited) Pro forma revenue $ 7,989.6 $ 8,828.1 Pro forma net income $ 276.2 $ 234.0 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable consisted of the following: As of December 31, 2021 2020 (In millions) Vehicle receivables $ 73.1 $ 61.2 Manufacturer receivables 44.0 57.1 Other receivables 114.3 38.4 Total accounts receivable 231.4 156.7 Less—Allowance for credit losses (1.6) (1.2) Accounts receivable, net $ 229.8 $ 155.5 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consisted of the following: As of December 31, 2021 2020 (In millions) New vehicles $ 206.5 $ 640.0 Used vehicles 402.0 188.5 Parts and accessories 109.9 46.7 Total inventories, net (a) $ 718.4 $ 875.2 ____________________________ (a) Amounts reflected for inventory as of December 31, 2021, excluded $24.1 million, of inventories classified as Assets held for sale. |
ASSETS HELD FOR SALE (Tables)
ASSETS HELD FOR SALE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Assets Held for Sale and Liabilities Associated with Assets Held for Sale | A summary of assets held for sale and liabilities associated with assets held for sale is as follows: As of December 31, 2021 2020 (In millions) Assets: Inventory $ 24.1 $ — Loaners, net 4.6 — Property and equipment, net 110.8 28.3 Operating lease right-of-use assets 7.1 — Goodwill 118.5 — Franchise rights 110.0 — Total Assets held for sale 375.1 28.3 Liabilities: Floor plan notes payable—non-trade 9.1 — Loaners/ Notes payable 4.6 — Current maturities of long-term debt — 0.5 Current maturities of operating leases 2.7 — Long-term debt — 8.4 Operating lease liabilities 4.4 — Total Liabilities associated with assets held for sale 20.8 8.9 Net assets held for sale $ 354.3 $ 19.4 |
OTHER CURRENT ASSETS (Tables)
OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Other Assets [Abstract] | |
Schedule of Other Current Assets | Other current assets consisted of the following: As of December 31, 2021 2020 (In millions) Loaner vehicles $ 150.3 $ 136.0 Contract assets (see Note 2) 27.2 20.4 Prepaid expenses 12.7 13.4 Prepaid taxes 4.6 7.1 Deposits 1.5 1.1 Other 7.4 5.8 Other current assets $ 203.7 $ 183.8 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Carrying Amounts of Investment Securities and Fair Values | As of December 31, 2021 Amortized Cost Allowance For Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value (In millions) Short-term investments $ 11.0 $ — $ — $ — $ 11.0 U.S Treasury 7.5 — — (0.1) 7.4 Municipal 27.9 — 0.4 (0.1) 28.2 Corporate 9.5 — 0.1 (0.1) 9.5 Mortgage and other asset-backed securities 8.8 — 0.1 (0.1) 8.8 Total debt securities 64.7 — 0.6 (0.4) 64.9 Common stock 65.2 — — — 65.2 Other investments measured at net asset value 4.4 — — — 4.4 Total investments $ 134.3 $ — $ 0.6 $ (0.4) $ 134.5 |
Schedule of Amortized Cost and Fair Value of TCA's Investment | A summary of amortized costs and fair value of investments by time to maturity, is as follows: As of December 31, 2021 Amortized Costs Fair Value (In millions) Due in 1 year or less $ 11.0 $ 11.0 Due in 1-5 years 44.6 44.8 Due in 5-10 years 0.3 0.3 Due after 10 years — — Total by maturity 55.9 56.1 Mortgage and other asset-backed securities 8.8 8.8 Common stock 65.2 65.2 Other investments measured at net asset value 4.4 4.4 Total investment securities $ 134.3 $ 134.5 |
Schedule of Unrealized Loss on Investments | The following table summarizes the amount of unrealized losses, defined as the amount by which the amortized cost exceeds fair value, and the related fair value of investments with unrealized losses as of December 31, 2021. The investments were segregated into two categories: those that have been in a continuous unrealized loss position for less than 12 months and those that have been in a continuous unrealized loss position of 12 or more months. The reference point for determining how long an investment was in an unrealized loss position was December 31, 2021. All investments were acquired in the LHM acquisition on December 17, 2021, therefore there are no unrealized losses greater than 12 months at December 31, 2021. As of December 31, 2021 Less than 12 Months Greater than 12 Months Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (In millions) U.S Treasury 7.1 (0.1) — — 7.1 (0.1) Municipal 10.0 (0.1) — — 10.0 (0.1) Corporate 6.4 (0.1) — — 6.4 (0.1) Mortgage and other asset-backed securities 5.8 (0.1) — — 5.8 (0.1) Total debt securities $ 29.3 $ (0.4) $ — $ — $ 29.3 $ (0.4) |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | The ranges of estimated useful lives are as follows (in years): Buildings and improvements 10-40 Machinery and equipment 5-10 Furniture and fixtures 3-10 Company vehicles 3-5 Property and equipment, net consisted of the following: As of December 31, 2021 2020 (In millions) Land $ 704.3 $ 350.5 Buildings and leasehold improvements 1,338.5 691.6 Machinery and equipment 128.8 107.4 Furniture and fixtures 87.3 72.9 Company vehicles 12.1 9.5 Construction in progress 46.9 19.9 Gross property and equipment 2,317.9 1,251.8 Less—Accumulated depreciation (327.9) (295.6) Property and equipment, net (a) $ 1,990.0 $ 956.2 ______________________________ |
GOODWILL AND INTANGIBLE FRANC_2
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill and Intangibles | The changes in goodwill and intangible franchise rights for the years ended December 31, 2021 and 2020 are as follows: Goodwill (In millions) Balance as of December 31, 2019 (a) $ 201.7 Acquisitions 364.3 Divestitures (9.1) Reclassified from assets held for sale 5.3 Balance as of December 31, 2020 (a) $ 562.2 Acquisitions 1,828.6 Divestitures (0.6) Reclassified to assets held for sale (118.5) Balance as of December 31, 2021 (a) $ 2,271.7 _____________________________ (a) Net of accumulated impairment losses of $537.7 million recorded prior to the year ended December 31, 2019. Intangible Franchise Rights (In millions) Balance as of December 31, 2019 $ 121.7 Acquisitions 337.8 Divestitures (11.3) Impairments (23.0) Balance as of December 31, 2020 $ 425.2 Acquisitions 1,020.5 Reclassified to assets held for sale (110.0) Balance as of December 31, 2021 $ 1,335.7 |
FLOOR PLAN NOTES PAYABLE_TRADE
FLOOR PLAN NOTES PAYABLE—TRADE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Floor Plan Notes Payable - Trade | Floor plan notes payable—trade, net consisted of the following: As of December 31, 2021 2020 (In millions) Floor plan notes payable—trade $ 39.3 $ 71.7 Floor plan notes payable offset account (2.0) (6.8) Total floor plan notes payable—trade, net $ 37.3 $ 64.9 |
FLOOR PLAN NOTES PAYABLE_NON-_2
FLOOR PLAN NOTES PAYABLE—NON-TRADE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Floor Plan Notes Payable - Non-Trade | Floor plan notes payable—non-trade, net consisted of the following: As of December 31, 2021 2020 (In millions) Floor plan notes payable—new non-trade (a) $ 314.7 $ 715.9 Floor plan notes payable—used non-trade 294.0 — Floor plan notes payable offset account (81.5) (78.6) Total floor plan notes payable—non-trade, net $ 527.2 $ 637.3 ___________________________ |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable and accrued liabilities consisted of the following: As of December 31, 2021 2020 (In millions) Accounts payable $ 163.9 $ 97.6 Loaner vehicles notes payable (a) 146.3 132.7 Taxes payable 125.7 69.1 Accrued compensation 118.5 43.7 Accrued insurance 27.9 24.3 Accrued finance and insurance chargebacks 31.5 23.3 Accrued interest 24.3 16.4 Customer deposits 23.2 8.7 Unearned premium 13.0 — Accrued licenses and regulatory fees 9.6 9.6 Customer we owe liabilities 7.0 2.8 Accrued advertising 3.3 3.2 Other 48.7 19.5 Accounts payable and accrued liabilities $ 742.9 $ 450.9 ____________________________ (a) Amounts reflected for Loaner vehicles notes payable as of December 31, 2021, excluded $4.6 million classified as Liabilities associated with assets held for sale. |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consisted of the following: As of December 31, 2021 2020 (In millions) 4.50% Senior Notes due 2028 405.0 405.0 4.625% Senior Notes due 2029 800.0 — 4.75% Senior Notes due 2030 445.0 445.0 5.00% Senior Notes due 2032 600.0 — Mortgage notes payable bearing interest at fixed rates (the weighted average interest rates were 4.6% and 5.4% for the year ended December 31, 2021 and 2020, respectively) 71.7 79.2 2021 Real Estate Facility 689.7 — 2021 BofA Real Estate Facility 180.7 — 2018 Bank of America Facility 78.8 84.2 2018 Wells Fargo Master Loan Facility (a) 81.9 86.9 2013 BofA Real Estate Facility 31.1 33.6 2015 Wells Fargo Master Loan Facility (b) 53.2 61.7 2019 Syndicated Revolving Credit Facility 169.0 — Finance lease liability 8.4 16.6 Total debt outstanding 3,614.5 1,212.2 Add—unamortized premium on 4.50% Senior Notes due 2028 1.0 1.2 Add—unamortized premium on 4.75% Senior Notes due 2030 1.8 2.1 Less—debt issuance costs (34.7) (13.7) Long-term debt, including current portion 3,582.6 1,201.8 Less—current portion, net of debt issuance costs (62.5) (36.6) Long-term debt $ 3,520.1 $ 1,165.2 ____________________________ (a) Amounts reflected for the 2018 Wells Fargo Master Loan Facility as of December 31, 2020, exclude $5.1 million classified as Liabilities associated with assets held for sale. (b) Amounts reflected for the 2015 Wells Fargo Master Loan Facility as of December 31, 2020, exclude $3.8 million classified as Liabilities associated with assets held for sale. |
Schedule of Aggregate Maturities | The aggregate maturities of long-term debt as of December 31, 2021 are as follows (in millions): 2022 $ 53.7 2023 75.9 2024 263.7 2025 142.7 2026 574.3 Thereafter 2,504.2 Total maturities of long-term debt $ 3,614.5 |
Schedule of Mortgage Notes Payable | Below is a summary of our outstanding mortgage notes payable, the carrying values of the related collateralized real estate, and year of maturity as of December 31, 2021 and 2020: As of December 31, 2021 As of December 31, 2020 Mortgage Agreement Aggregate Principal Outstanding Carrying Value of Collateralized Related Real Estate Maturity Dates Aggregate Principal Outstanding Carrying Value of Collateralized Related Real Estate Maturity Dates Captive mortgages $ 70.9 $ 152.2 2021-2024 $ 77.4 $ 201.7 2020-2024 Other mortgage debt 0.8 42.8 2021-2022 1.8 43.2 2020-2022 2021 Real Estate Facility 689.7 928.9 2026 — — — 2021 BofA Real Estate Facility 180.7 199.4 2031 — — — 2018 BofA Real Estate Facility 78.8 105.0 2025 84.2 106.2 2025 2018 Wells Fargo Master Loan Facility (a) 81.9 105.3 2028 86.9 112.9 2028 2013 BofA Real Estate Facility 31.1 71.8 2023 33.6 73.3 2023 2015 Wells Fargo Master Loan Facility (b) 53.2 95.3 2025 61.7 109.6 2025 Total mortgage debt $ 1,187.1 $ 1,700.7 $ 345.6 $ 646.9 ____________________________ (a) Amounts reflected for the 2018 Wells Fargo Master Loan Facility as of December 31, 2020 exclude $5.1 million classified as Liabilities associated with assets held for sale. (b) Amounts reflected for the 2015 Wells Fargo Master Loan Facility as of December 31, 2020 exclude $3.8 million classified as Liabilities associated with assets held for sale. |
FINANCIAL INSTRUMENTS AND FAI_2
FINANCIAL INSTRUMENTS AND FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Derivatives and Fair Value [Abstract] | |
Schedule of Carrying Values and Fair Values of Liabilities | A summary of the carrying values and fair values of our Notes and our mortgage notes payable is as follows: As of December 31, 2021 2020 (In millions) Carrying Value: 4.50% Senior Notes due 2028 $ 401.6 $ 400.9 4.625% Senior Notes due 2029 787.9 — 4.75% Senior Notes due 2030 441.2 440.6 5.00% Senior Notes due 2032 $ 590.9 $ — Mortgage notes payable (a) 1,183.6 343.7 Total carrying value $ 3,405.2 $ 1,185.2 Fair Value: 4.50% Senior Notes due 2028 $ 413.6 $ 423.2 4.625% Senior Notes due 2029 815.0 — 4.75% Senior Notes due 2030 455.0 476.2 5.00% Senior Notes due 2032 621.8 — Mortgage notes payable (a) 1,196.6 354.5 Total fair value $ 3,502.0 $ 1,253.9 ____________________________ (a) The balances as of December 31, 2020 exclude amounts classified as Liabilities associated with assets held for sale. |
Schedule of Derivative Instruments | December 31, 2021: Inception Date Notional Value at Inception Notional Value as of December 31, 2021 Notional Value at Maturity Maturity Date (In millions) May 2021 $ 184.4 $ 180.7 $ 110.6 May 2031 July 2020 $ 93.5 $ 86.6 $ 50.6 December 2028 July 2020 $ 85.5 $ 78.8 $ 57.3 November 2025 June 2015 $ 100.0 $ 69.3 $ 53.1 February 2025 November 2013 $ 75.0 $ 45.2 $ 38.7 September 2023 |
Schedule of Derivative Instruments Fair Value | The following table provides information regarding the fair value of our interest rate swap agreements and the impact on the Consolidated Balance Sheets: As of December 31, 2021 2020 (In millions) Other current liabilities $ (3.8) $ (2.8) Other long-term assets 5.5 — Other long-term liabilities (2.6) (4.4) Total fair value $ (0.9) $ (7.2) |
Schedule of Derivative Instruments Effect on Accumulated Other Comprehensive Income | For the Year Ended December 31, Results Recognized in Accumulated Other Comprehensive Loss Location of Results Reclassified from Accumulated Other Comprehensive Loss to Earnings Results Reclassified from Accumulated Other Comprehensive Loss 2021 $ 11.0 Other interest expense, net $ 4.7 2020 $ (6.1) Other interest expense, net $ (2.5) 2019 $ (4.4) Other interest expense, net $ — |
Schedule of Fair Value, Assets Measured on Recurring Basis | The table below presents the Company’s investment securities that are measured at fair value on a recurring basis aggregated by the level in the fair value hierarchy within which those measurements fall: As of December 31, 2021 Level 1 Level 2 Level 3 Total (In millions) Cash equivalents $ 6.0 $ — $ — $ 6.0 Short-term investments 2.9 8.1 — 11.0 U.S Treasury 7.4 — — 7.4 Municipal — 28.2 — 28.2 Corporate — 9.5 — 9.5 Mortgage and other asset backed securities — 8.8 — 8.8 Total debt securities 10.3 54.6 — 64.9 Common stock 65.2 — — 65.2 Total $ 75.5 $ 54.6 $ — $ 130.1 Investments measured at net asset value (a) 4.4 Total Investments, at fair value $ 134.5 (a) In accordance with ASC 820-10, certain investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The NAV is based on the fair value of the underlying assets owned by the fund, minus its liabilities, divided by the number of units outstanding and is determined by the fund investment manager or custodian. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | The components of income tax expense are as follows: For the Year Ended December 31, 2021 2020 2019 (In millions) Current: Federal $ 113.9 $ 64.5 $ 46.3 State 20.8 9.8 8.0 Total current income tax expense 134.7 74.3 54.3 Deferred: Federal 24.8 9.2 5.5 State 5.8 0.2 (0.3) Total deferred income tax expense 30.6 9.4 5.2 Total income tax expense $ 165.3 $ 83.7 $ 59.5 |
Reconciliation of the Statutory Federal Rate to the Effective Rate | A reconciliation of the statutory federal rate to the effective tax rate is as follows (dollar amounts shown in millions) : For the Year Ended December 31, 2021 % 2020 % 2019 % Income tax provision at the statutory rate $ 146.5 21.0 $ 71.0 21.0 $ 51.2 21.0 State income tax expense, net of federal benefit 21.0 3.0 10.1 3.0 7.8 3.2 Non-deductible/non-tax items 0.6 0.1 1.3 0.4 0.6 0.2 Other, net (2.8) (0.4) 1.3 0.4 (0.1) — Income tax expense $ 165.3 23.7 $ 83.7 24.8 $ 59.5 24.4 |
Schedule of Deferred Tax Assets and Liabilities | Deferred income tax asset and liability components consisted of the following: As of December 31, 2021 2020 (In millions) Deferred income tax assets: Deferred Revenue $ 139.4 $ — F&I chargeback liabilities 11.9 $ 11.5 Other accrued liabilities 2.2 4.7 Stock-based compensation 2.7 2.3 Operating lease right-of-use assets 67.2 77.8 Other, net 10.6 10.2 Total deferred income tax assets $ 234.0 $ 106.5 Deferred income tax liabilities: Intangible asset amortization (42.4) (23.9) Depreciation (50.7) (39.2) Operating lease liabilities (65.6) (76.8) Investments, net (2.0) — Other, net (4.2) (1.2) Total deferred income tax liabilities $ (164.9) $ (141.1) Net deferred income tax liabilities $ 69.1 $ (34.6) |
OTHER LONG-TERM LIABILITIES (Ta
OTHER LONG-TERM LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Long-Term Liabilities | Other long-term liabilities consisted of the following: As of December 31, 2021 2020 (In millions) Unearned premiums $ 24.0 $ — Accrued finance and insurance chargebacks 22.4 22.9 Unclaimed property 4.6 3.1 Interest rate swap 2.6 4.4 Deferred payroll tax — 9.1 Sale and leaseback liability — 7.0 Other 7.1 4.4 Other long-term liabilities $ 60.7 $ 50.9 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | The following items are included in Other adjustments, net to reconcile net income to net cash provided by operating activities: For the Year Ended December 31, 2021 2020 2019 (In millions) Amortization of debt issuance costs $ 2.6 $ 1.8 $ 2.5 (Gain) Loss on disposal of fixed assets (2.3) 0.7 2.6 Other individually immaterial items (1.1) (1.2) (0.3) Other adjustments, net $ (0.8) $ 1.3 $ 4.8 The following table presents supplemental cash flow information for leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Supplemental Cash Flow: Cash paid for amounts included in the measurements of lease liabilities Operating cash flows from finance lease $ 0.4 $ 0.7 Operating cash flows from operating leases $ 32.9 $ 27.6 Financing cash flows from finance lease $ 0.1 $ 0.6 Right-of-use assets obtained in exchange for new finance lease liabilities $ 8.4 $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ 69.2 $ 272.3 Changes to finance lease right-of-use asset resulting from lease reassessment event $ (14.6) $ — |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Assets And Liabilities, Lessee | Balance Sheet Presentation As of December 31, Leases Classification 2021 2020 (In millions) Assets: Current Operating Assets held for sale 7.1 — Non-Current Operating Operating lease right-of-use assets $ 261.0 $ 317.4 Finance Property and equipment, net 8.4 14.6 Total right-of-use assets $ 276.5 $ 332.0 Liabilities: Current Operating Current maturities of operating leases $ 25.8 $ 24.8 Operating Liabilities held for sale 2.7 — Finance Current maturities of long-term debt — 16.6 Non-Current Operating Operating lease liabilities 242.0 296.7 Operating Liabilities held for sale 4.4 — Finance Long-term debt 8.4 — Total lease liabilities $ 283.3 $ 338.1 |
Lease Term and Discount Rate, Lessee | Lease Term and Discount Rate As of December 31, 2021 2020 Weighted Average Lease Term - Operating Leases 14.4 years 14.3 years Weighted Average Lease Term - Finance Lease 38.7 years 0.2 years Weighted Average Discount Rate - Operating Leases 4.5 % 4.5 % Weighted Average Discount Rate - Finance Lease 4.3 % 4.1 % |
Lease, Cost | The following table provides certain information related to the lease costs for finance and operating leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Finance lease cost (Interest) $ 0.4 $ 0.7 Operating lease cost 33.9 28.2 Short-term lease cost 1.1 1.5 Variable lease cost 2.5 2.4 $ 37.9 $ 32.8 |
Schedule of Cash Flow, Supplemental Disclosures | The following items are included in Other adjustments, net to reconcile net income to net cash provided by operating activities: For the Year Ended December 31, 2021 2020 2019 (In millions) Amortization of debt issuance costs $ 2.6 $ 1.8 $ 2.5 (Gain) Loss on disposal of fixed assets (2.3) 0.7 2.6 Other individually immaterial items (1.1) (1.2) (0.3) Other adjustments, net $ (0.8) $ 1.3 $ 4.8 The following table presents supplemental cash flow information for leases during the years ended December 31, 2021 and 2020. For the Year Ended December 31, 2021 2020 (In millions) Supplemental Cash Flow: Cash paid for amounts included in the measurements of lease liabilities Operating cash flows from finance lease $ 0.4 $ 0.7 Operating cash flows from operating leases $ 32.9 $ 27.6 Financing cash flows from finance lease $ 0.1 $ 0.6 Right-of-use assets obtained in exchange for new finance lease liabilities $ 8.4 $ — Right-of-use assets obtained in exchange for new operating lease liabilities $ 69.2 $ 272.3 Changes to finance lease right-of-use asset resulting from lease reassessment event $ (14.6) $ — |
Lessee, Operating Lease, Liability, Maturity | The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities as of December 31, 2021, including leases related to liabilities associated with assets held for sale . Finance Operating (In millions) 2022 $ 0.4 $ 40.0 2023 0.4 36.6 2024 0.4 28.6 2025 0.4 26.1 2026 0.4 24.3 Thereafter 16.5 229.4 Total minimum lease payments $ 18.5 $ 385.0 Less: Amount of lease payments representing interest (10.1) (110.1) Present value of future minimum lease payments $ 8.4 $ 274.9 Less: current obligations under leases — (28.5) Long-term lease obligation $ 8.4 $ 246.4 |
Finance Lease, Liability, Maturity | The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining years to the finance lease liabilities and operating lease liabilities as of December 31, 2021, including leases related to liabilities associated with assets held for sale . Finance Operating (In millions) 2022 $ 0.4 $ 40.0 2023 0.4 36.6 2024 0.4 28.6 2025 0.4 26.1 2026 0.4 24.3 Thereafter 16.5 229.4 Total minimum lease payments $ 18.5 $ 385.0 Less: Amount of lease payments representing interest (10.1) (110.1) Present value of future minimum lease payments $ 8.4 $ 274.9 Less: current obligations under leases — (28.5) Long-term lease obligation $ 8.4 $ 246.4 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Reportable segment financial information for the year ended December 31, 2021, are as follows: As of and for the year ended December 31, 2021 Dealerships TCA Eliminations Total Company (In millions) Revenue $ 9,836.7 $ 12.0 $ (11.0) $ 9,837.7 Gross profit 1,901.7 5.5 (5.0) 1,902.2 Depreciation and amortization 41.9 — — 41.9 Selling, general and administrative expense 1,076.9 0.3 (3.3) 1,073.9 Interest expense Floor plan interest expense 8.2 — — 8.2 Other interest expense, net 93.9 — — 93.9 Total interest expense $ 102.1 $ — $ — $ 102.1 Capital expenditures 74.2 — — $ 74.2 Total Assets $ 7,289.7 $ 762.6 $ (49.7) $ 8,002.6 |
SHARE-BASED COMPENSATION AND _2
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Compensation Related Costs [Abstract] | |
Schedule of Performance Share Units | The following table summarizes information about performance share units for 2021: Shares Weighted Average Grant Date Non-vested at January 1, 2021 194,486 $ 82.70 Granted 80,922 132.52 Vested (79,582) 71.82 Forfeited or unearned (58,097) 95.32 Non-vested at December 31, 2021 137,729 $ 118.07 The weighted average grant-date fair value of performance share units and total fair value of performance share units vested are summarized in the following table: For the Year Ended December 31, 2021 2020 2019 Weighted average grant-date fair value of performance share units granted $ 132.52 $ 96.31 $ 69.67 Total fair value of performance share units vested (in millions) $ 5.7 $ 4.9 $ 6.0 |
Schedule of Restricted Stock | The following table summarizes information about restricted share units for 2021: Shares Weighted Average Grant Date Non-vested at January 1, 2021 102,593 $ 93.97 Granted 72,732 150.38 Vested (38,818) 98.31 Forfeited (19,760) 107.00 Non-vested at December 31, 2021 116,747 125.33 The weighted average grant-date fair value of restricted share units and total fair value of restricted share units vested are summarized in the following table: For the Year Ended December 31, 2021 2020 2019 Weighted average grant-date fair value of restricted share units granted $ 150.38 $ 94.07 $ — Total fair value of restricted share units vested (in millions) $ 3.8 $ 0.3 $ — The following table summarizes information about restricted stock awards for 2021: Shares Weighted Average Grant Non-vested at January 1, 2021 98,630 $ 68.66 Granted — — Vested (58,028) 147.83 Forfeited (2,067) 69.20 Non-vested at December 31, 2021 38,535 $ 68.61 The weighted average grant-date fair value of restricted stock awards and total fair value of restricted stock awards vested are summarized in the following table: For the Year Ended December 31, 2021 2020 2019 Weighted average grant-date fair value of restricted stock granted $ — $ — $ 69.18 Total fair value of restricted stock awards vested (in millions) $ 8.6 $ 5.1 $ 5.1 |
DESCRIPTION OF BUSINESS AND S_4
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Description) (Details) $ in Millions | Dec. 17, 2021USD ($)numberOfUsedCarsStorescollision_center | Aug. 24, 2020USD ($)DealershipLocationsfranchisecollision_center | Jul. 06, 2020numberOfSubsidiariesdealership_locationfranchisecollision_center | Dec. 31, 2021dealership_locationfranchisenumberOfUsedCarsStoresbusinessCollisionRepairCentersstatescollision_centerVehicleBrands |
Business Organization [Line Items] | ||||
Number of franchises (in franchises) | franchise | 205 | |||
Number of vehicle brands (in vehicle brands) | VehicleBrands | 31 | |||
Number of dealership locations (in dealership locations) | dealership_location | 155 | |||
Number of collision repair centers (in collision repair centers) | CollisionRepairCenters | 35 | |||
Stand-alone used vehicle dealerships (in dealership) | dealership_location | 7 | |||
Used vehicle wholesale business | business | 1 | |||
Number of auto auctions (in auto auction) | dealership_location | 1 | |||
Number of states (in states) | states | 15 | |||
Number of collision centers acquired (in collision centers) | collision_center | 2 | |||
Number of franchises acquired (in franchises) | franchise | 12 | |||
Number of dealership locations acquired (in dealership locations) | dealership_location | 8 | |||
Asset Purchase Agreement | ||||
Business Organization [Line Items] | ||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | |||
Number of subsidiaries | numberOfSubsidiaries | 2 | |||
Number of franchises acquired (in franchises) | franchise | 12 | |||
Number of dealership locations acquired (in dealership locations) | DealershipLocations | 8 | |||
Consideration transferred | $ | $ 889.9 | |||
LHM Acquisition | ||||
Business Organization [Line Items] | ||||
Number of new vehicle dealerships acquired (in new vehicle dealerships) | collision_center | 54 | 54 | ||
Number of used cars stores acquired (in used cars stores) | numberOfUsedCarsStores | 7 | 7 | ||
Number of collision centers acquired (in collision centers) | collision_center | 11 | 11 | ||
Aggregate purchase price | $ | $ 3,480 |
DESCRIPTION OF BUSINESS AND S_5
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) | Dec. 17, 2021USD ($)numberOfUsedCarsStorescollision_center | Jul. 06, 2020collision_center | Dec. 31, 2021USD ($)collision_centernumberOfUsedCarsStores | Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($)segment | Dec. 31, 2019USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2020 | Feb. 19, 2020 |
Accounting Policies [Line Items] | |||||||||
Restricted securities | $ 2,500,000 | $ 2,500,000 | |||||||
Impairment of real estate | 700,000 | $ 0 | $ 0 | ||||||
Goodwill, impairment | 0 | $ 537,700,000 | |||||||
Repurchase or retirement of previously repurchased common stock | 0 | 0 | |||||||
Advertising expense | 30,700,000 | 25,500,000 | 34,400,000 | ||||||
Advertising credits and volume discounts | 22,400,000 | 19,600,000 | 21,100,000 | ||||||
Investments | 134,500,000 | 134,500,000 | |||||||
Total debt outstanding | 3,614,500,000 | $ 3,614,500,000 | $ 1,212,200,000 | ||||||
Revenues by major brand, disclosure percentage threshold | 5.00% | ||||||||
Number of reportable segments | segment | 2 | 1 | |||||||
Assumed contract liabilities | 647,800,000 | $ 647,800,000 | |||||||
Tax Cuts and Jobs Act, reclassification from AOCI to retained earnings | 200,000 | ||||||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | ||||||||
Goodwill | $ 2,271,700,000 | 2,271,700,000 | $ 562,200,000 | 201,700,000 | $ 201,700,000 | ||||
LHM Dealerships | TCA | |||||||||
Accounting Policies [Line Items] | |||||||||
Goodwill | $ 710,300,000 | ||||||||
LHM Dealerships | Dealerships | |||||||||
Accounting Policies [Line Items] | |||||||||
Goodwill | 929,000,000 | ||||||||
LHM Acquisition | |||||||||
Accounting Policies [Line Items] | |||||||||
Value of business acquired (VOBA) | $ 5,600,000 | ||||||||
Number of new vehicle dealerships acquired (in new vehicle dealerships) | collision_center | 54 | 54 | |||||||
Number of used cars stores acquired (in used cars stores) | numberOfUsedCarsStores | 7 | 7 | |||||||
Number of collision centers acquired (in collision centers) | collision_center | 11 | 11 | |||||||
Goodwill | $ 1,639,300,000 | ||||||||
Mortgages | |||||||||
Accounting Policies [Line Items] | |||||||||
Long-term debt, gross | $ 71,700,000 | 71,700,000 | 79,200,000 | ||||||
Senior Notes | 4.50% Senior Notes due 2028 | |||||||||
Accounting Policies [Line Items] | |||||||||
Long-term debt, gross | $ 405,000,000 | $ 405,000,000 | 405,000,000 | ||||||
Stated interest rate of debt instrument | 4.50% | 4.50% | 4.50% | 4.50% | |||||
Senior Notes | 4.75% Senior Notes due 2030 | |||||||||
Accounting Policies [Line Items] | |||||||||
Long-term debt, gross | $ 445,000,000 | $ 445,000,000 | $ 445,000,000 | ||||||
Stated interest rate of debt instrument | 4.75% | 4.75% | 4.75% | 4.75% | |||||
Retained Earnings | |||||||||
Accounting Policies [Line Items] | |||||||||
Repurchase or retirement of previously repurchased common stock | 12,800,000 | ||||||||
Treasury Stock | |||||||||
Accounting Policies [Line Items] | |||||||||
Repurchase or retirement of previously repurchased common stock | $ (15,300,000) | ||||||||
Minimum | |||||||||
Accounting Policies [Line Items] | |||||||||
Loaner vehicle period of use before sale (in months) | 6 months | ||||||||
Maximum | |||||||||
Accounting Policies [Line Items] | |||||||||
Loaner vehicle period of use before sale (in months) | 12 months |
DESCRIPTION OF BUSINESS AND S_6
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Schedule of Property and Equipment Useful Lives) (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Buildings and improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 10 years |
Buildings and improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 40 years |
Machinery and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 5 years |
Machinery and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 10 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 3 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 10 years |
Company vehicles | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 3 years |
Company vehicles | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 5 years |
DESCRIPTION OF BUSINESS AND S_7
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Schedule of Revenues by Major Brand) (Details) - New vehicles | 12 Months Ended |
Dec. 31, 2021 | |
Toyota Motor Sales, U.S.A., Inc. (Toyota and Lexus) | |
Schedule of Revenues by Major Brand [Line Items] | |
Revenues by major brand, percentage | 24.00% |
American Honda Motor Co., Inc. (Honda and Acura) | |
Schedule of Revenues by Major Brand [Line Items] | |
Revenues by major brand, percentage | 19.00% |
Mercedes-Benz USA, LLC (Mercedes-Benz and Sprinter) | |
Schedule of Revenues by Major Brand [Line Items] | |
Revenues by major brand, percentage | 13.00% |
Ford Motor Company (Ford and Lincoln) | |
Schedule of Revenues by Major Brand [Line Items] | |
Revenues by major brand, percentage | 7.00% |
Nissan North America, Inc. (Nissan and Infiniti) | |
Schedule of Revenues by Major Brand [Line Items] | |
Revenues by major brand, percentage | 5.00% |
BMW of North America, LLC (BMW and MINI) | |
Schedule of Revenues by Major Brand [Line Items] | |
Revenues by major brand, percentage | 5.00% |
REVENUE RECOGNITION (Disaggrega
REVENUE RECOGNITION (Disaggregation of Revenue) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 9,837.7 | $ 7,131.8 | $ 7,210.3 |
New and used vehicle | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 8,249.7 | 5,936.9 | 5,994.9 |
New and used vehicle | New vehicle | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 4,934.1 | 3,767.4 | 3,863.3 |
New and used vehicle | Used vehicle retail | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 3,055.9 | 1,930 | 1,941.3 |
New and used vehicle | Used vehicle wholesale | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 259.7 | 239.5 | 190.3 |
Parts and services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 1,182.9 | 889.8 | 899.4 |
Parts and services | Sale of vehicle parts and accessories | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 212 | 140.1 | 148.8 |
Parts and services | Vehicle repair and maintenance services | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | 970.9 | 749.7 | 750.6 |
Finance and insurance, net | |||
Disaggregation of Revenue [Line Items] | |||
Total revenue | $ 405.1 | $ 305.1 | $ 316 |
REVENUE RECOGNITION (Contract A
REVENUE RECOGNITION (Contract Assets) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Change in Contract with Customer, Asset [Roll Forward] | ||
Beginning balance | $ 20.4 | $ 17.1 |
Transferred to receivables from contract assets recognized at the beginning of the period | (21.8) | (17.1) |
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period | 28.6 | 20.4 |
Ending balance | 27.2 | 20.4 |
Assumed contract liabilities | 647.8 | |
Deferred Sales Commissions | ||
Change in Contract with Customer, Asset [Roll Forward] | ||
Beginning balance | 0 | 0 |
Transferred to receivables from contract assets recognized at the beginning of the period | 0 | 0 |
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period | 1.4 | |
Ending balance | 1.4 | 0 |
New and used vehicle | Vehicle repair and maintenance services | ||
Change in Contract with Customer, Asset [Roll Forward] | ||
Beginning balance | 7.1 | 4.8 |
Transferred to receivables from contract assets recognized at the beginning of the period | (7.1) | (4.8) |
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period | 12.3 | 7.1 |
Ending balance | 12.3 | 7.1 |
Finance and insurance, net | ||
Change in Contract with Customer, Asset [Roll Forward] | ||
Beginning balance | 13.3 | 12.3 |
Transferred to receivables from contract assets recognized at the beginning of the period | (14.7) | (12.3) |
Increases related to revenue recognized, inclusive of adjustments to constraint, during the period | 14.9 | 13.3 |
Ending balance | $ 13.5 | $ 13.3 |
ACQUISITIONS AND DIVESTITURES_2
ACQUISITIONS AND DIVESTITURES (LHM Acquisition - Narrative) (Details) $ in Millions | Dec. 31, 2021USD ($) | Dec. 17, 2021USD ($)numberOfUsedCarsStorescollision_center | Jul. 06, 2020collision_center | Dec. 31, 2021USD ($)collision_centernumberOfUsedCarsStores | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Business Acquisition [Line Items] | |||||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | ||||||
Revenues | $ 9,837.7 | $ 7,131.8 | $ 7,210.3 | ||||
Net income | 532.4 | $ 254.4 | $ 184.4 | ||||
LHM Acquisition | |||||||
Business Acquisition [Line Items] | |||||||
Number of new vehicle dealerships acquired (in new vehicle dealerships) | collision_center | 54 | 54 | |||||
Number of used cars stores acquired (in used cars stores) | numberOfUsedCarsStores | 7 | 7 | |||||
Number of collision centers acquired (in collision centers) | collision_center | 11 | 11 | |||||
Aggregate purchase price | $ 3,480 | ||||||
Transaction costs | $ 4.9 | $ 4.9 | $ 4.9 | ||||
Revenues | 256.4 | ||||||
Net income | $ 15.7 |
ACQUISITIONS AND DIVESTITURES_3
ACQUISITIONS AND DIVESTITURES (LHM Acquisition) (Details) - USD ($) $ in Millions | Dec. 17, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Summary of Assets Acquired and Liabilities Assumed | ||||
Goodwill | $ 2,271.7 | $ 562.2 | $ 201.7 | |
LHM Acquisition | ||||
Consideration Transferred | ||||
Cash, net of cash acquired | $ 195 | |||
Common stock offering | 666.9 | |||
Payable to sellers | 6 | |||
Preliminary purchase price, net of cash acquired | 3,193.9 | |||
Summary of Assets Acquired and Liabilities Assumed | ||||
Cash and cash equivalents | 287.4 | |||
Investments | 133.5 | |||
Contracts-in-transit, net | 99.5 | |||
Accounts receivable, net | 110 | |||
Inventories, net | 285 | |||
Other current assets | 25.4 | |||
Total current assets | 940.8 | |||
Property and equipment, net | 792.6 | |||
Goodwill | 1,639.3 | |||
Intangible franchise rights | 870 | |||
Operating lease right-of-use assets | 34.1 | |||
Deferred income taxes | 136.5 | |||
Other long-term assets | 5.6 | |||
Total assets acquired | 4,418.9 | |||
Operating lease liabilities | 34.1 | |||
Accounts payable and accrued liabilities | 234 | |||
Deferred revenue | 644.3 | |||
Other long-term liabilities | 25.2 | |||
Total liabilities assumed | 937.6 | |||
Net assets acquired | 3,481.3 | |||
LHM Acquisition | Senior Notes | ||||
Consideration Transferred | ||||
Other | 1,578.5 | |||
LHM Acquisition | 2021 Real Estate Facility | ||||
Consideration Transferred | ||||
Other | 513 | |||
LHM Acquisition | New Vehicle Floor Plan Facility | ||||
Consideration Transferred | ||||
Other | 183.5 | |||
LHM Acquisition | Used Vehicle Floor Plan Facility | ||||
Consideration Transferred | ||||
Other | $ 51 |
ACQUISITIONS AND DIVESTITURES_4
ACQUISITIONS AND DIVESTITURES (Park Place Acquisition) (Details) | May 20, 2021USD ($) | Aug. 24, 2020USD ($)DealershipLocationsfranchisecollision_center | Jul. 06, 2020numberOfSubsidiariesdealership_locationfranchisecollision_center | Dec. 31, 2020USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Mar. 24, 2020USD ($) |
Business Acquisition [Line Items] | ||||||||
Payment of liquidated damages | $ 10,000,000 | |||||||
Number of franchises acquired (in franchises) | franchise | 12 | |||||||
Number of dealership locations acquired (in dealership locations) | dealership_location | 8 | |||||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | |||||||
Operating lease, right-of-use asset | $ 317,400,000 | $ 261,000,000 | $ 317,400,000 | |||||
Operating lease, liability | 274,900,000 | |||||||
Revenues | 9,837,700,000 | 7,131,800,000 | $ 7,210,300,000 | |||||
Net income | 532,400,000 | $ 254,400,000 | $ 184,400,000 | |||||
Seller Note | 4.00% Promissory Note due August 2021 | ||||||||
Business Acquisition [Line Items] | ||||||||
Face amount | $ 150,000,000 | |||||||
Stated interest rate of debt instrument | 4.00% | |||||||
Seller Note | 4.00% Promissory Note due February 2022 | ||||||||
Business Acquisition [Line Items] | ||||||||
Face amount | $ 50,000,000 | |||||||
Stated interest rate of debt instrument | 4.00% | |||||||
Asset Purchase Agreement | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of subsidiaries | numberOfSubsidiaries | 2 | |||||||
Number of franchises acquired (in franchises) | franchise | 12 | |||||||
Number of dealership locations acquired (in dealership locations) | DealershipLocations | 8 | |||||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | |||||||
Measurement period adjustment to property and equipment | 1,500,000 | |||||||
Measurement period adjustment to goodwill | 1,500,000 | |||||||
Operating lease, right-of-use asset | $ 99,500,000 | |||||||
Operating lease, liability | 99,500,000 | |||||||
Operating lease | $ 217,100,000 | |||||||
Revenues | 589,600,000 | 1,790,000,000 | ||||||
Transaction costs | $ 1,300,000 | |||||||
Net income | $ 27,600,000 |
ACQUISITIONS AND DIVESTITURES_5
ACQUISITIONS AND DIVESTITURES (Park Place- Preliminary Purchase Price) (Details) - Asset Purchase Agreement $ in Millions | Jul. 06, 2020USD ($) |
Asset Acquisition [Line Items] | |
Cash | $ 527.4 |
Seller Notes | 200 |
New Vehicle Floor Plan Facility | 127.5 |
Used Vehicle Floor Plan Facility | 35 |
Purchase price | $ 889.9 |
ACQUISITIONS AND DIVESTITURES_6
ACQUISITIONS AND DIVESTITURES (Park Place- Allocation of Purchase Price) (Details) - Asset Purchase Agreement $ in Millions | Jul. 06, 2020USD ($) |
Asset Acquisition [Line Items] | |
Inventories | $ 120.8 |
Loaner vehicles | 57 |
Property and equipment | 36.5 |
Goodwill | 360.4 |
Manufacturer franchise rights | 324 |
Operating lease right-of-use assets | 202.7 |
Total assets acquired | 1,101.4 |
Operating lease liabilities | (202.2) |
Other liabilities | (9.3) |
Total liabilities assumed | (211.5) |
Net assets acquired | $ 889.9 |
ACQUISITIONS AND DIVESTITURES_7
ACQUISITIONS AND DIVESTITURES (Pro Forma Information) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Asset Purchase Agreement | ||
Business Acquisition [Line Items] | ||
Pro Forma Revenue | $ 7,989.6 | $ 8,828.1 |
Pro Forma Net Income | 276.2 | 234 |
LHM Acquisition | ||
Business Acquisition [Line Items] | ||
Pro Forma Revenue | 15,431.5 | 12,927.3 |
Pro Forma Net Income | $ 777.3 | $ 359.9 |
ACQUISITIONS AND DIVESTITURES_8
ACQUISITIONS AND DIVESTITURES (Acquisitions- Narrative) (Details) $ in Millions | Jul. 06, 2020dealership_locationfranchisecollision_center | Dec. 31, 2021USD ($)franchisedealership_location | Dec. 31, 2020USD ($)dealership_locationfranchise | Dec. 31, 2019USD ($)dealership_locationfranchisecollision_center |
Business Acquisition [Line Items] | ||||
Number of franchises acquired (in franchises) | franchise | 12 | |||
Number of dealership locations acquired (in dealership locations) | dealership_location | 8 | |||
Number of collision centers acquired (in collision centers) | collision_center | 2 | |||
Series of Individually Immaterial Business Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Aggregate purchase price | $ 485.7 | $ 210.4 | ||
Cash paid for acquisition | 455.1 | 153.9 | ||
Payable to sellers | 9.6 | 55.3 | ||
Purchase price holdbacks | 21 | 1.2 | ||
Consideration transferred, other, release | $ 1 | $ 0.8 | ||
Colorado | Series of Individually Immaterial Business Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Number of franchises acquired (in franchises) | franchise | 11 | 3 | 1 | |
Number of dealership locations acquired (in dealership locations) | dealership_location | 10 | 1 | 1 | |
Aggregate purchase price | $ 63.6 | |||
Cash paid for acquisition | 34.5 | |||
Payable to sellers | 27.1 | |||
Purchase price holdbacks | 2 | |||
Consideration transferred, other, release | $ 2.5 | |||
Indiana | Series of Individually Immaterial Business Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Number of franchises acquired (in franchises) | franchise | 3 | 9 | ||
Number of dealership locations acquired (in dealership locations) | dealership_location | 1 | 5 | ||
Number of collision centers acquired (in collision centers) | collision_center | 1 |
ACQUISITIONS AND DIVESTITURES_9
ACQUISITIONS AND DIVESTITURES (Schedule of Business Acquisitions) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||
Goodwill | $ 2,271.7 | $ 562.2 | $ 201.7 |
Series of Individually Immaterial Business Acquisitions | |||
Business Acquisition [Line Items] | |||
Inventories, net | 38.3 | 29.8 | |
Real estate | 99.9 | 14.5 | |
Property and equipment, net | 4.4 | 0.4 | |
Goodwill | 187.2 | 5.4 | |
Intangible franchise rights | 150.5 | 13.8 | |
Loaner vehicles | 8.9 | 0 | |
Other | (3.5) | (0.3) | |
Net assets acquired | $ 485.7 | $ 63.6 |
ACQUISITIONS AND DIVESTITURE_10
ACQUISITIONS AND DIVESTITURES (Divestitures- Narrative) (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)dealership_locationfranchise | Dec. 31, 2020USD ($)dealership_locationfranchisecollision_centercenter | Dec. 31, 2019USD ($)centerdealership_locationfranchise | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of dealership locations, sold (in dealership locations) | 1 | 8 | |
Number of collision centers, sold (in collision centers) | collision_center | 1 | ||
Proceeds from divestiture | $ | $ 21.3 | $ 177.9 | $ 39.1 |
Gain on divestitures | $ | 8 | $ 62.3 | 11.7 |
Virginia | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Gain on divestitures | $ | $ 8 | ||
Texas | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from divestiture | $ | $ 30.1 | ||
Colorado | Series of Individually Immaterial Business Acquisitions | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Goodwill and manufacturer franchise rights, period for federal and state tax deductions | 15 years | ||
Disposed of by Sale | Virginia | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of franchises, sold (in franchises) | franchise | 1 | ||
Number of dealership locations, sold (in dealership locations) | 1 | ||
Disposed of by Sale | Georgia | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of franchises, sold (in franchises) | franchise | 2 | ||
Number of dealership locations, sold (in dealership locations) | 2 | ||
Disposed of by Sale | Mississippi | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of franchises, sold (in franchises) | franchise | 6 | ||
Number of dealership locations, sold (in dealership locations) | 5 | ||
Number of collision centers, sold (in collision centers) | center | 1 | ||
Disposed of by Sale | South Carolina | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of franchises, sold (in franchises) | franchise | 1 | ||
Number of dealership locations, sold (in dealership locations) | 1 | ||
Disposed of by Sale | Texas | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of franchises, sold (in franchises) | franchise | 1 | ||
Number of dealership locations, sold (in dealership locations) | 1 | ||
Number of collision centers, sold (in collision centers) | center | 1 |
ACCOUNTS RECEIVABLE (Details)
ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | $ 231.4 | $ 156.7 |
Less—Allowance for credit losses | (1.6) | (1.2) |
Accounts receivable, net | 229.8 | 155.5 |
Vehicle receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | 73.1 | 61.2 |
Manufacturer receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | 44 | 57.1 |
Other receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable | $ 114.3 | $ 38.4 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Components of Inventory [Line Items] | |||
Total inventories | $ 718.4 | $ 875.2 | |
Lower of cost or market inventory reserves | 7.7 | 6.7 | |
Held-for-sale | |||
Components of Inventory [Line Items] | |||
Total inventories | 24.1 | ||
New vehicles | |||
Components of Inventory [Line Items] | |||
Total inventories | 206.5 | 640 | |
Reduction of new vehicle inventory cost by automobile manufacturer incentives | 1.2 | 8.3 | |
Reduction to new vehicle cost of sales by automobile manufacturer incentives | 60.4 | 47 | $ 45.7 |
Used vehicles | |||
Components of Inventory [Line Items] | |||
Total inventories | 402 | 188.5 | |
Parts and accessories | |||
Components of Inventory [Line Items] | |||
Total inventories | $ 109.9 | $ 46.7 |
ASSETS HELD FOR SALE (Assets He
ASSETS HELD FOR SALE (Assets Held for Sale and Liabilities Associated with the Assets) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Inventories | $ 24.1 | $ 0 |
Loaners, net | 4.6 | 0 |
Property and equipment, net | 110.8 | 28.3 |
Operating lease right-of-use assets | 7.1 | 0 |
Goodwill | 118.5 | 0 |
Franchise rights | 110 | 0 |
Total Assets | 375.1 | 28.3 |
Liabilities: | ||
Floor plan notes payable—non-trade | 9.1 | 0 |
Loaners/ Notes payable | 4.6 | 0 |
Current maturities of long-term debt | 0 | 0.5 |
Current maturities of operating leases | 2.7 | 0 |
Long-term debt | 0 | 8.4 |
Operating lease liabilities | 4.4 | 0 |
Total Liabilities associated with assets held for sale | 20.8 | 8.9 |
Net assets held for sale | $ 354.3 | $ 19.4 |
ASSETS HELD FOR SALE (Narrative
ASSETS HELD FOR SALE (Narrative) (Details) | Jul. 06, 2020dealership_location | Dec. 31, 2021USD ($)dealership_locationfranchiseproperty | Dec. 31, 2020USD ($)franchisedealership_locationcollision_center | Dec. 31, 2019USD ($) |
Long Lived Assets Held-for-sale [Line Items] | ||||
Assets held for sale | $ 354,300,000 | $ 19,400,000 | ||
Liabilities associated with assets held for sale | $ 20,800,000 | $ 8,900,000 | ||
Number of franchise, sold (in franchises) | franchise | 1 | 9 | ||
Number of dealership locations, sold (in dealership locations) | dealership_location | 1 | 8 | ||
Number of collision centers, sold (in collision centers) | collision_center | 1 | |||
Gain on divestitures | $ 8,000,000 | $ 62,300,000 | $ 11,700,000 | |
Impairment of real estate | $ 700,000 | $ 0 | $ 0 | |
Number of dealership locations acquired (in dealership locations) | dealership_location | 8 | |||
Held-for-sale | ||||
Long Lived Assets Held-for-sale [Line Items] | ||||
Number of real estate properties | franchise | 8 | 3 | ||
Assets held for sale | $ 28,300,000 | |||
Liabilities associated with assets held for sale | 8,900,000 | |||
Gain on divestitures | 62,300,000 | |||
Impairment of real estate | $ 0 | $ 700,000 | ||
Number of dealership locations acquired (in dealership locations) | dealership_location | 8 | |||
Held-for-sale | Vacant Property | ||||
Long Lived Assets Held-for-sale [Line Items] | ||||
Number of real estate properties | franchise | 2 | 1 | ||
Held-for-sale | Real Estate Not Currently Used in Operations | ||||
Long Lived Assets Held-for-sale [Line Items] | ||||
Number of real estate properties | property | 1 | |||
Assets held for sale | $ 375,100,000 | |||
Liabilities associated with assets held for sale | 20,800,000 | |||
Disposed of by Sale | Vacant Property | ||||
Long Lived Assets Held-for-sale [Line Items] | ||||
Real estate held-for-sale | $ 12,500,000 | $ 3,700,000 |
OTHER CURRENT ASSETS (Details)
OTHER CURRENT ASSETS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Other Assets [Abstract] | |||
Loaner vehicles | $ 150.3 | $ 136 | |
Contract assets | 27.2 | 20.4 | $ 17.1 |
Prepaid taxes | 12.7 | 13.4 | |
Prepaid taxes | 4.6 | 7.1 | |
Deposits | 1.5 | 1.1 | |
Other | 7.4 | 5.8 | |
Other current assets | $ 203.7 | $ 183.8 |
INVESTMENTS - Carrying Amounts
INVESTMENTS - Carrying Amounts of Investments (Details) $ in Millions | Dec. 31, 2021USD ($) |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | $ 134.3 |
Gross Unrealized Gains | 0.6 |
Gross Unrealized Losses | (0.4) |
Fair Value | 134.5 |
Interest receivable | 0.6 |
Short-term Investments | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 11 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | 0 |
Fair Value | 11 |
Total debt securities | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 64.7 |
Gross Unrealized Gains | 0.6 |
Gross Unrealized Losses | (0.4) |
Fair Value | 64.9 |
U.S Treasury | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 7.5 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | (0.1) |
Fair Value | 7.4 |
Municipal | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 27.9 |
Gross Unrealized Gains | 0.4 |
Gross Unrealized Losses | (0.1) |
Fair Value | 28.2 |
Corporate | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 9.5 |
Gross Unrealized Gains | 0.1 |
Gross Unrealized Losses | (0.1) |
Fair Value | 9.5 |
Mortgage and other asset-backed securities | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 8.8 |
Gross Unrealized Gains | 0.1 |
Gross Unrealized Losses | (0.1) |
Fair Value | 8.8 |
Common Stock | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 65.2 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | 0 |
Fair Value | 65.2 |
Other investments measured at net asset value | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 4.4 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | 0 |
Fair Value | $ 4.4 |
INVESTMENTS - Amortized Cost an
INVESTMENTS - Amortized Cost and Fair Value of TCA's Investment (Details) | Dec. 31, 2021USD ($) |
Available-for-Sale, Amortized Cost | |
Due in 1 year or less | $ 11,000,000 |
Due in 1-5 years | 44,600,000 |
Due in 5-10 years | 300,000 |
Due after 10 years | 0 |
Total by maturity | 55,900,000 |
Available-for-Sale, Fair Value | |
Due in 1 year or less | 11,000,000 |
Due in 1-5 years | 44,800,000 |
Due in 5-10 years | 300,000 |
Due after 10 years | 0 |
Total by maturity | 56,100,000 |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 134,300,000 |
Fair Value | 134,500,000 |
Debt securities, available-for-sale, gain (loss) | 0 |
Mortgage and other asset-backed securities | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 8,800,000 |
Fair Value | 8,800,000 |
Common Stock | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 65,200,000 |
Fair Value | 65,200,000 |
Other investments measured at net asset value | |
Debt Securities, Available-for-sale [Line Items] | |
Amortized Cost | 4,400,000 |
Fair Value | $ 4,400,000 |
INVESTMENTS - Schedule of Gross
INVESTMENTS - Schedule of Gross Realized Gains and Losses (Details) $ in Millions | Dec. 31, 2021USD ($) |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 Months, Fair Value | $ 29.3 |
Less than 12 Months, Gross Unrealized Losses | 0.4 |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Gross Unrealized Losses | 0 |
Total Fair Value | 29.3 |
Total Gross Unrealized Losses | 0.4 |
U.S Treasury | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 Months, Fair Value | 7.1 |
Less than 12 Months, Gross Unrealized Losses | 0.1 |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Gross Unrealized Losses | 0 |
Total Fair Value | 7.1 |
Total Gross Unrealized Losses | 0.1 |
Municipal | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 Months, Fair Value | 10 |
Less than 12 Months, Gross Unrealized Losses | 0.1 |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Gross Unrealized Losses | 0 |
Total Fair Value | 10 |
Total Gross Unrealized Losses | 0.1 |
Corporate | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 Months, Fair Value | 6.4 |
Less than 12 Months, Gross Unrealized Losses | 0.1 |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Gross Unrealized Losses | 0 |
Total Fair Value | 6.4 |
Total Gross Unrealized Losses | 0.1 |
Mortgage and other asset-backed securities | |
Debt Securities, Available-for-sale [Line Items] | |
Less than 12 Months, Fair Value | 5.8 |
Less than 12 Months, Gross Unrealized Losses | 0.1 |
12 Months or Longer, Fair Value | 0 |
12 Months or Longer, Gross Unrealized Losses | 0 |
Total Fair Value | 5.8 |
Total Gross Unrealized Losses | $ 0.1 |
PROPERTY AND EQUIPMENT, NET (Sc
PROPERTY AND EQUIPMENT, NET (Schedule of Property and Equipment, Net) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | $ 2,317.9 | $ 1,251.8 |
Less—Accumulated depreciation | (327.9) | (295.6) |
Property and equipment, net | 1,990 | 956.2 |
Finance lease | 8.4 | 14.6 |
OPERATING LEASE RIGHT-OF-USE ASSETS | 261 | 317.4 |
Held-for-sale | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 110.8 | 28.3 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | 704.3 | 350.5 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | 1,338.5 | 691.6 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | 128.8 | 107.4 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | 87.3 | 72.9 |
Company vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | 12.1 | 9.5 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Gross property and equipment | $ 46.9 | $ 19.9 |
PROPERTY AND EQUIPMENT, NET (Na
PROPERTY AND EQUIPMENT, NET (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Interest costs capitalized | $ 0.8 | $ 0.4 | $ 0.6 |
Depreciation and capital lease obligation amortization | $ 41.9 | $ 38.5 | $ 36.2 |
GOODWILL AND INTANGIBLE FRANC_3
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS (Narrative) (Details) $ in Millions | Dec. 17, 2021USD ($)numberOfUsedCarsStorescollision_center | Jul. 06, 2020collision_center | Dec. 31, 2021collision_centernumberOfUsedCarsStores | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Business Acquisition [Line Items] | |||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | ||||
Goodwill acquired | $ 1,828.6 | $ 364.3 | |||
Franchise rights | |||||
Business Acquisition [Line Items] | |||||
Intangible assets acquired | $ 1,020.5 | $ 337.8 | |||
LHM Acquisition | |||||
Business Acquisition [Line Items] | |||||
Number of new vehicle dealerships acquired (in new vehicle dealerships) | collision_center | 54 | 54 | |||
Number of used cars stores acquired (in used cars stores) | numberOfUsedCarsStores | 7 | 7 | |||
Number of collision centers acquired (in collision centers) | collision_center | 11 | 11 | |||
Aggregate purchase price | $ 3,480 | ||||
Goodwill acquired | 1,640 | ||||
Value of business acquired | 5.6 | ||||
LHM Acquisition | Franchise rights | |||||
Business Acquisition [Line Items] | |||||
Intangible assets acquired | $ 870 |
GOODWILL AND INTANGIBLE FRANC_4
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS (Goodwill) (Details) - USD ($) $ in Millions | 12 Months Ended | 216 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Roll Forward] | |||
Net, beginning balance | $ 562.2 | $ 201.7 | |
Acquisitions | 1,828.6 | 364.3 | |
Divestitures | (0.6) | (9.1) | |
Reclassified (to) from assets held for sale | (118.5) | 5.3 | |
Net, ending balance | 2,271.7 | $ 562.2 | $ 201.7 |
Goodwill, impairment | $ 0 | $ 537.7 |
GOODWILL AND INTANGIBLE FRANC_5
GOODWILL AND INTANGIBLE FRANCHISE RIGHTS (Franchise Rights) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Indefinite-lived Intangible Assets [Roll Forward] | ||||
Impairments | $ 0 | $ (23) | $ (7.1) | |
Franchise rights impairment | $ 23 | 0 | 23 | 7.1 |
Franchise rights | ||||
Indefinite-lived Intangible Assets [Roll Forward] | ||||
Beginning balance | $ 425.2 | 425.2 | 121.7 | |
Acquisitions | 1,020.5 | 337.8 | ||
Indefinite-lived Intangible Assets Reclassified to Held for Sale | (110) | |||
Divestitures | (11.3) | |||
Impairments | (23) | |||
Ending balance | $ 1,335.7 | $ 425.2 | $ 121.7 |
FLOOR PLAN NOTES PAYABLE_TRAD_2
FLOOR PLAN NOTES PAYABLE—TRADE (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
Floor plan notes payable—trade | $ 39.3 | $ 71.7 |
Floor plan notes payable offset account | (2) | (6.8) |
Total floor plan notes payable—trade, net | $ 37.3 | $ 64.9 |
FLOOR PLAN NOTES PAYABLE_NON-_3
FLOOR PLAN NOTES PAYABLE—NON-TRADE (Consist of) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
Floor plan notes payable—new non-trade | $ 314.7 | $ 715.9 |
Floor plan notes payable—used non-trade | 294 | 0 |
Floor plan notes payable offset account | (81.5) | (78.6) |
Total floor plan notes payable—non-trade, net | $ 527.2 | 637.3 |
Floor plan notes payable—non-trade, liabilities associated with assets held for sale | $ 9.1 |
FLOOR PLAN NOTES PAYABLE_NON-_4
FLOOR PLAN NOTES PAYABLE—NON-TRADE (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Oct. 29, 2021 | Oct. 16, 2014 | |
Revolving Credit Facility1 | Line of Credit | Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.15% | ||
Revolving Credit Facility1 | Line of Credit | Maximum | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.40% | ||
Revolving Credit Facility1 | Line of Credit | LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
Revolving Credit Facility1 | Line of Credit | Federal Funds | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Revolving Credit Facility1 | Bank of America | Line of Credit | LIBOR | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
Revolving Credit Facility1 | Bank of America | Line of Credit | LIBOR | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 2.00% | ||
Revolving Credit Facility1 | Bank of America | Line of Credit | Base Rate | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.15% | ||
Revolving Credit Facility1 | Bank of America | Line of Credit | Base Rate | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
New Vehicle Floor Plan Facility | Line of Credit | LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.10% | ||
New Vehicle Floor Plan Facility | Line of Credit | Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.10% | ||
Used Vehicle Floor Plan Facility | Line of Credit | LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.40% | ||
Used Vehicle Floor Plan Facility | Line of Credit | Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.40% | ||
New Vehicle and Used Vehicle Floor Plan | Line of Credit | |||
Debt Instrument [Line Items] | |||
Unused capacity, commitment fee percentage | 0.15% | ||
Revolving Credit Facility | 2019 Senior Credit Facility | Bank of America | |||
Debt Instrument [Line Items] | |||
Aggregate commitments | $ 450,000,000 | ||
Standby Letters of Credit | Bank of America | |||
Debt Instrument [Line Items] | |||
Face amount | $ 50,000,000 | $ 50,000,000 | |
New Vehicle Revolving Floor Plan Facility | 2019 Senior Credit Facility | Bank of America | |||
Debt Instrument [Line Items] | |||
Aggregate commitments | 1,750,000,000 | ||
Used Vehicle Revolving Floor Plan Facility | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.15% | ||
Used Vehicle Revolving Floor Plan Facility | 2019 Senior Credit Facility | Bank of America | |||
Debt Instrument [Line Items] | |||
Aggregate commitments | $ 350,000,000 | ||
Senior Credit Facility | 2019 Senior Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 350,000,000 |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 163.9 | $ 97.6 |
Loaner vehicles notes payable | 146.3 | 132.7 |
Taxes payable | 125.7 | 69.1 |
Accrued compensation | 118.5 | 43.7 |
Accrued insurance | 27.9 | 24.3 |
Accrued finance and insurance chargebacks | 31.5 | 23.3 |
Accrued interest | 24.3 | 16.4 |
Customer deposits | 23.2 | 8.7 |
Unearned premiums | 13 | 0 |
Accrued licenses and regulatory fees | 9.6 | 9.6 |
Customer we owe liabilities | 7 | 2.8 |
Accrued advertising | 3.3 | 3.2 |
Other | 48.7 | 19.5 |
Accounts payable and accrued liabilities | 742.9 | 450.9 |
Loaners/ Notes payable | $ 4.6 | $ 0 |
LONG-TERM DEBT (Schedule of Lon
LONG-TERM DEBT (Schedule of Long-Term Debt) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Nov. 19, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 26, 2020 | Feb. 19, 2020 |
Debt Instrument [Line Items] | ||||||
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | OTHER LONG-TERM LIABILITIES | OTHER LONG-TERM LIABILITIES | ||||
Finance lease liability | $ 8.4 | $ 16.6 | ||||
Total debt outstanding | 3,614.5 | 1,212.2 | ||||
Less: debt issuance costs | (34.7) | (13.7) | ||||
Long-term debt, including current portion | 3,582.6 | 1,201.8 | ||||
Less—current portion, net of debt issuance costs | (62.5) | (36.6) | ||||
Long-term debt | 3,520.1 | 1,165.2 | ||||
2021 Real Estate Facility | Bank of America | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 689.7 | 0 | ||||
2021 BofA Real Estate Facility | Wells Fargo | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 180.7 | 0 | ||||
2018 BofA Real Estate Facility | Bank of America | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 78.8 | 84.2 | ||||
2018 Wells Fargo Master Loan Facility | ||||||
Debt Instrument [Line Items] | ||||||
Mortgage note payable classified as liabilities associated with assets held-for-sale | 5.1 | |||||
2018 Wells Fargo Master Loan Facility | Wells Fargo | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 81.9 | 86.9 | $ 69.4 | |||
2013 BofA Real Estate Facility | Bank of America | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 31.1 | 33.6 | ||||
2015 Wells Fargo Master Loan Facility | ||||||
Debt Instrument [Line Items] | ||||||
Mortgage note payable classified as liabilities associated with assets held-for-sale | 3.8 | |||||
2015 Wells Fargo Master Loan Facility | Wells Fargo | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 53.2 | 61.7 | ||||
2019 Syndicated Revolving Credit Facility | Bank of America | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 169 | 0 | ||||
Mortgages | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 71.7 | $ 79.2 | ||||
Weighted average interest rate | 4.60% | 5.40% | ||||
Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Add: unamortized premium | $ 3.5 | |||||
Less: debt issuance costs | $ (17.5) | $ (6.8) | ||||
Senior Notes | 4.50% Senior Notes due 2028 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 405 | $ 405 | ||||
Add: unamortized premium | $ 1 | 1.2 | ||||
Stated interest rate of debt instrument | 4.50% | 4.50% | 4.50% | |||
Senior Notes | 4.625% Senior Notes due 2029 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 800 | 0 | ||||
Stated interest rate of debt instrument | 4.625% | 4.625% | ||||
Senior Notes | 4.75% Senior Notes due 2030 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 445 | 445 | ||||
Add: unamortized premium | $ 1.8 | 2.1 | ||||
Stated interest rate of debt instrument | 4.75% | 4.75% | 4.75% | |||
Senior Notes | 5.00% Senior Notes due 2032 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 600 | $ 0 | ||||
Stated interest rate of debt instrument | 5.00% | 5.00% |
LONG-TERM DEBT (Schedule of Agg
LONG-TERM DEBT (Schedule of Aggregate Maturities of Long-Term Debt) (Details) $ in Millions | Dec. 31, 2021USD ($) |
Debt Disclosure [Abstract] | |
2022 | $ 53.7 |
2023 | 75.9 |
2024 | 263.7 |
2025 | 142.7 |
2026 | 574.3 |
Thereafter | 2,504.2 |
Total maturities of long-term debt | $ 3,614.5 |
LONG-TERM DEBT (New Senior Note
LONG-TERM DEBT (New Senior Notes and Seller Notes) (Details) - USD ($) | Nov. 19, 2021 | Mar. 30, 2020 | Mar. 04, 2020 | Sep. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Aug. 24, 2020 | Feb. 19, 2020 |
Debt Instrument [Line Items] | ||||||||
Unamortized debt issuance expense | $ 34,700,000 | $ 13,700,000 | ||||||
Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 250,000,000 | |||||||
Unamortized debt issuance expense | $ 17,500,000 | $ 6,800,000 | ||||||
Additional debt issuance costs | 4,000,000 | $ 3,100,000 | ||||||
Percent of principal amount | 100.00% | |||||||
Write-off of unamortized debt issuance costs | $ 1,500,000 | |||||||
Initial purchasers' discounts and expenses | 2,800,000 | |||||||
Proceeds from issuance of debt | 250,600,000 | |||||||
Unamortized premium | 3,500,000 | |||||||
Extinguishment of debt, amount | 50,000,000 | |||||||
Senior Notes | 4.625% Senior Notes due 2029 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 800,000,000 | |||||||
Stated interest rate of debt instrument | 4.625% | 4.625% | ||||||
Maximum redemption as percent from aggregate principal amount | 40.00% | |||||||
Redemption price, percentage | 104.625% | |||||||
Percent of principal amount | 100.00% | |||||||
Senior Notes | 5.00% Senior Notes due 2032 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 600,000,000 | |||||||
Stated interest rate of debt instrument | 5.00% | 5.00% | ||||||
Maximum redemption as percent from aggregate principal amount | 40.00% | |||||||
Redemption price, percentage | 105.00% | |||||||
Percent of principal amount | 100.00% | |||||||
Senior Notes | 4.50% Senior Notes due 2028 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 125,000,000 | $ 525,000,000 | ||||||
Stated interest rate of debt instrument | 4.50% | 4.50% | 4.50% | |||||
Redemption price, percentage | 101.00% | |||||||
Redemption amount pro rata basis | $ 245,000,000 | |||||||
Unamortized premium | $ 1,000,000 | 1,200,000 | ||||||
Senior Notes | 4.75% Senior Notes due 2030 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 125,000,000 | $ 600,000,000 | ||||||
Stated interest rate of debt instrument | 4.75% | 4.75% | 4.75% | |||||
Redemption price, percentage | 101.75% | |||||||
Redemption amount pro rata basis | $ 280,000,000 | |||||||
Unamortized premium | $ 1,800,000 | $ 2,100,000 | ||||||
Senior Subordinated Notes | 6.0% Senior Subordinated Notes due 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Stated interest rate of debt instrument | 6.00% | |||||||
Redemption price, percentage | 103.00% | |||||||
Seller Note | 4.00% Promissory Note due August 2021 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 150,000,000 | |||||||
Stated interest rate of debt instrument | 4.00% | |||||||
Seller Note | 4.00% Promissory Note due February 2022 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 50,000,000 | |||||||
Stated interest rate of debt instrument | 4.00% |
LONG-TERM DEBT (6.0% Senior Sub
LONG-TERM DEBT (6.0% Senior Subordinated Notes due 2024) (Details) - USD ($) $ in Millions | Mar. 04, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||||
Loss on extinguishment of long-term debt, net | $ 0 | $ 20.6 | $ 0 | |
Senior Subordinated Notes | 6.0% Senior Subordinated Notes due 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate of debt instrument | 6.00% | |||
Redemption price, percentage | 103.00% | |||
Loss on extinguishment of long-term debt, net | $ 19.1 | |||
Redemption premium | 18 | |||
Unamortized premium and debt issuance costs | $ (1.1) |
LONG-TERM DEBT (Mortgage Notes
LONG-TERM DEBT (Mortgage Notes Payable) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Mortgages | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 71.7 | $ 79.2 |
LONG-TERM DEBT (2021 Real Estat
LONG-TERM DEBT (2021 Real Estate Facility) (Details) - Bank of America - 2021 Real Estate Facility $ in Millions | Dec. 17, 2021USD ($)numberOfPayments | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 689.7 | ||
Number of quarterly principal payments | numberOfPayments | 20 | ||
Quarterly principal payments as percent of initial amount | 1.25% | ||
Long-term debt, gross | $ 689.7 | $ 0 | |
Daily Simple SOFR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
Daily Simple SOFR | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.55% | ||
Daily Simple SOFR | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.95% | ||
Base Rate | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.55% | ||
Base Rate | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.95% | ||
Federal Funds | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% |
LONG-TERM DEBT (2021 BofA Real
LONG-TERM DEBT (2021 BofA Real Estate Facility) (Details) - Bank of America - 2021 BofA Real Estate Facility $ in Millions | May 20, 2021USD ($)numberOfPayments |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | $ | $ 184.4 |
Number of quarterly principal payments | numberOfPayments | 39 |
Quarterly principal payments as percent of initial amount | 1.00% |
Base Rate | Minimum | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 0.65% |
Federal Funds | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 0.50% |
LIBOR | Minimum | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 1.65% |
One month LIBOR | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 1.00% |
LONG-TERM DEBT (2018 BofA Real
LONG-TERM DEBT (2018 BofA Real Estate Facility) (Details) - Bank of America - 2018 BofA Real Estate Facility - USD ($) $ in Millions | Nov. 13, 2018 | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 128.1 | ||
Quarterly principal payments as percent of initial amount | 1.25% | ||
Repayment schedule | 20 years | ||
Long-term debt, gross | $ 78.8 | $ 84.2 | |
LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.50% | ||
Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Federal Funds | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
One month LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% |
LONG-TERM DEBT (2018 Wells Farg
LONG-TERM DEBT (2018 Wells Fargo Master Loan Facility) (Details) - 2018 Wells Fargo Master Loan Facility - Wells Fargo $ in Millions | Nov. 06, 2018 | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Jun. 26, 2020USD ($) | Nov. 16, 2018USD ($)payment |
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 100 | ||||
Number of equal monthly principal payments | payment | 108 | ||||
Amortization schedule | 19 years | ||||
Long-term debt, gross | $ 81.9 | $ 86.9 | $ 69.4 | ||
LIBOR | Minimum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.50% | ||||
LIBOR | Maximum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.85% |
LONG-TERM DEBT (2015 Wells Farg
LONG-TERM DEBT (2015 Wells Fargo Master Loan Facility) (Details) - 2015 Wells Fargo Master Loan Facility - Wells Fargo $ in Millions | Feb. 03, 2015USD ($)payment | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 100 | ||
Number of equal monthly principal payments | payment | 108 | ||
Amortization schedule | 19 years | ||
Long-term debt, gross | $ 53.2 | $ 61.7 | |
LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.85% |
LONG-TERM DEBT (2013 BofA Real
LONG-TERM DEBT (2013 BofA Real Estate Facility) (Details) - 2013 BofA Real Estate Facility - Bank of America - USD ($) $ in Millions | Sep. 26, 2013 | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 75 | ||
Quarterly principal payments as percent of initial amount | 1.25% | ||
Repayment schedule | 20 years | ||
Long-term debt, gross | $ 31.1 | $ 33.6 | |
LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.50% | ||
Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Federal Funds | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
One month LIBOR | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% |
LONG-TERM DEBT (Schedule of Mor
LONG-TERM DEBT (Schedule of Mortgage Notes Payable) (Details) - Mortgages - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | $ 1,187.1 | $ 345.6 |
Carrying Value of Collateralized Related Real Estate | 1,700.7 | 646.9 |
Captive mortgages | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 70.9 | 77.4 |
Carrying Value of Collateralized Related Real Estate | 152.2 | 201.7 |
Other mortgage debt | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 0.8 | 1.8 |
Carrying Value of Collateralized Related Real Estate | 42.8 | 43.2 |
2021 Real Estate Facility | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 689.7 | 0 |
Carrying Value of Collateralized Related Real Estate | 928.9 | 0 |
2021 BofA Real Estate Facility | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 180.7 | 0 |
Carrying Value of Collateralized Related Real Estate | 199.4 | 0 |
2018 BofA Real Estate Facility | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 78.8 | 84.2 |
Carrying Value of Collateralized Related Real Estate | 105 | 106.2 |
2018 Wells Fargo Master Loan Facility | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 81.9 | 86.9 |
Carrying Value of Collateralized Related Real Estate | 105.3 | 112.9 |
2013 BofA Real Estate Facility | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 31.1 | 33.6 |
Carrying Value of Collateralized Related Real Estate | 71.8 | 73.3 |
2015 Wells Fargo Master Loan Facility | ||
Debt Instrument [Line Items] | ||
Aggregate Principal Outstanding | 53.2 | 61.7 |
Carrying Value of Collateralized Related Real Estate | $ 95.3 | $ 109.6 |
LONG-TERM DEBT (Revolving Credi
LONG-TERM DEBT (Revolving Credit Facility and Stock Restrictions) (Details) - Bank of America - USD ($) | Dec. 31, 2021 | Oct. 16, 2014 |
Reastated Credit Agreement | ||
Debt Instrument [Line Items] | ||
Current borrowing capacity | $ 450,000,000 | |
Aggregate commitments | $ 169,000,000 | |
Remaining borrowing capacity | $ 270,200,000 | |
Reastated Credit Agreement | Federal Funds | ||
Debt Instrument [Line Items] | ||
Interest rate | 0.50% | |
Reastated Credit Agreement | LIBOR | Minimum | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.00% | |
Reastated Credit Agreement | LIBOR | Maximum | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.00% | |
Reastated Credit Agreement | Base Rate | Minimum | ||
Debt Instrument [Line Items] | ||
Interest rate | 0.15% | |
Reastated Credit Agreement | Base Rate | Maximum | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.00% | |
Reastated Credit Agreement | Guarantee Obligations | ||
Debt Instrument [Line Items] | ||
Amount of letters of credit outstanding | $ 10,800,000 | |
Standby Letters of Credit | ||
Debt Instrument [Line Items] | ||
Face amount | $ 50,000,000 | $ 50,000,000 |
New Vehicle Floor Plan Facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.10% | |
New Vehicle Floor Plan Facility | Base Rate | ||
Debt Instrument [Line Items] | ||
Interest rate | 0.10% | |
Used Vehicle Floor Plan Facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.40% | |
Used Vehicle Floor Plan Facility | Base Rate | ||
Debt Instrument [Line Items] | ||
Interest rate | 0.40% |
LONG-TERM DEBT (Stock Repurchas
LONG-TERM DEBT (Stock Repurchase and Dividend Restrictions) (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Senior Subordinated Notes | |
Debt Instrument [Line Items] | |
Restricted payments, aggregate amount | $ 20 |
General restricted payments allowance | $ 958.6 |
2019 Senior Credit Facility | |
Debt Instrument [Line Items] | |
Restricted payments capacity, percent of net income | 50.00% |
Percent of cash proceeds receive from sale of equity interests | 100.00% |
Maximum | 2019 Senior Credit Facility | |
Debt Instrument [Line Items] | |
Consolidated total leverage ratio | 3 |
FINANCIAL INSTRUMENTS AND FAI_3
FINANCIAL INSTRUMENTS AND FAIR VALUE (Narrative) (Details) | Dec. 31, 2021USD ($)numberOfInstruments | May 31, 2021USD ($) | Dec. 31, 2020USD ($) | Jun. 30, 2016USD ($) |
Level 2 | Other Liabilities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of interest rate swaps | $ 900,000 | $ (7,200,000) | ||
Interest Rate Swap | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Notional principal amount of derivative liability | $ 69,300,000 | $ 100,000,000 | ||
Notional principal amount of derivative liability, at maturity | $ 53,100,000 | |||
Interest Rate Swap | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Derivative, Number of Instruments Held | numberOfInstruments | 5 | |||
Notional principal amount of derivative liability | $ 180,700,000 | $ 184,400,000 | ||
Notional principal amount of derivative liability, at maturity | $ 110,600,000 | |||
Fair value of interest rate swaps | 900,000 | $ 7,200,000 | ||
Interest rate swap, net loss amount expected to be reclassified in the next twelve months | $ (3,800,000) |
FINANCIAL INSTRUMENTS AND FAI_4
FINANCIAL INSTRUMENTS AND FAIR VALUE (Summary of Carrying Values and Fair Values of Debt) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Nov. 19, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Feb. 19, 2020 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Total carrying value | $ 3,405.2 | $ 1,185.2 | |||
Total fair value | 3,502 | 1,253.9 | |||
Mortgages Notes Payable | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Total carrying value | 1,183.6 | 343.7 | |||
Total fair value | $ 1,196.6 | 354.5 | |||
4.50% Senior Notes due 2028 | Senior Notes | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Stated interest rate of debt instrument | 4.50% | 4.50% | 4.50% | ||
Total carrying value | $ 401.6 | 400.9 | |||
Total fair value | $ 413.6 | 423.2 | |||
4.625% Senior Notes due 2029 | Senior Notes | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Stated interest rate of debt instrument | 4.625% | 4.625% | |||
Total carrying value | $ 787.9 | 0 | |||
Total fair value | $ 815 | 0 | |||
4.75% Senior Notes due 2030 | Senior Notes | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Stated interest rate of debt instrument | 4.75% | 4.75% | 4.75% | ||
Total carrying value | $ 441.2 | 440.6 | |||
Total fair value | $ 455 | 476.2 | |||
5.00% Senior Notes due 2032 | Senior Notes | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Stated interest rate of debt instrument | 5.00% | 5.00% | |||
Total carrying value | $ 590.9 | 0 | |||
Total fair value | $ 621.8 | $ 0 |
FINANCIAL INSTRUMENTS AND FAI_5
FINANCIAL INSTRUMENTS AND FAIR VALUE (Interest Rate Swap Agreements) (Details) - Interest Rate Swap - USD ($) | Dec. 31, 2021 | May 31, 2021 | Jul. 31, 2020 | Jun. 30, 2016 | Nov. 30, 2013 |
Derivative [Line Items] | |||||
Notional principal amount of derivative liability | $ 180,700,000 | $ 184,400,000 | |||
Notional principal amount of derivative liability, at maturity | $ 110,600,000 | ||||
Notional principal amount of derivative liability | 86,600,000 | $ 93,500,000 | |||
Notional principal amount of derivative liability, at maturity | 50,600,000 | ||||
Notional principal amount of derivative liability | 78,800,000 | 85,500,000 | |||
Notional principal amount of derivative liability, at maturity | $ 57,300,000 | ||||
Notional principal amount of derivative liability | 69,300,000 | $ 100,000,000 | |||
Notional principal amount of derivative liability, at maturity | $ 53,100,000 | ||||
Notional principal amount of derivative liability | $ 45,200,000 | $ 75,000,000 | |||
Notional principal amount of derivative liability, at maturity | $ 38,700,000 |
FINANCIAL INSTRUMENTS AND FAI_6
FINANCIAL INSTRUMENTS AND FAIR VALUE (Schedule of Fair value of Interest Rate Swaps) (Details) - Interest Rate Swap - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of interest rate swaps assets (liabilities) | $ (0.9) | $ (7.2) |
Other current liabilities | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of interest rate swaps assets (liabilities) | (3.8) | (2.8) |
Other long-term assets | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of interest rate swaps assets (liabilities) | (5.5) | 0 |
Other long-term liabilities | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value of interest rate swaps assets (liabilities) | $ (2.6) | $ (4.4) |
FINANCIAL INSTRUMENTS AND FAI_7
FINANCIAL INSTRUMENTS AND FAIR VALUE (Schedule of Derivative Instruments Effect on the Consolidated Income Statement, Including Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Results Recognized in AOCI (Effective Portion) | $ 1.6 | $ (0.9) | $ (1.1) |
Interest Rate Swap | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Results Recognized in AOCI (Effective Portion) | 11 | (6.1) | (4.4) |
Interest Rate Swap | Interest Expense | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount Reclassified from AOCI to Earnings | $ 4.7 | $ (2.5) | $ 0 |
FINANCIAL INSTRUMENTS AND FAI_8
FINANCIAL INSTRUMENTS AND FAIR VALUE (Schedule of Investments at Fair Value) (Details) $ in Millions | Dec. 31, 2021USD ($) |
Investments measured at net asset value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | $ 4.4 |
Recurring | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 134.5 |
Recurring | Total | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 6 |
Total Investments, at fair value | 130.1 |
Recurring | Total | Total debt securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 64.9 |
Recurring | Total | Short-term Investments | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 11 |
Recurring | Total | U.S Treasury | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 7.4 |
Recurring | Total | Municipal | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 28.2 |
Recurring | Total | Corporate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 9.5 |
Recurring | Total | Mortgage and other asset-backed securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 8.8 |
Recurring | Total | Common Stock | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 65.2 |
Recurring | Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 6 |
Total Investments, at fair value | 75.5 |
Recurring | Level 1 | Total debt securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 10.3 |
Recurring | Level 1 | Short-term Investments | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 2.9 |
Recurring | Level 1 | U.S Treasury | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 7.4 |
Recurring | Level 1 | Municipal | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 1 | Corporate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 1 | Mortgage and other asset-backed securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 1 | Common Stock | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 65.2 |
Recurring | Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 0 |
Total Investments, at fair value | 54.6 |
Recurring | Level 2 | Total debt securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 54.6 |
Recurring | Level 2 | Short-term Investments | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 8.1 |
Recurring | Level 2 | U.S Treasury | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 2 | Municipal | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 28.2 |
Recurring | Level 2 | Corporate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 9.5 |
Recurring | Level 2 | Mortgage and other asset-backed securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 8.8 |
Recurring | Level 2 | Common Stock | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Cash equivalents | 0 |
Total Investments, at fair value | 0 |
Recurring | Level 3 | Total debt securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | Short-term Investments | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | U.S Treasury | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | Municipal | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | Corporate | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | Mortgage and other asset-backed securities | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Level 3 | Common Stock | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | 0 |
Recurring | Investments measured at net asset value | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Total Investments, at fair value | $ 4.4 |
INCOME TAXES (Schedule of Compo
INCOME TAXES (Schedule of Components of Income Tax Expense) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | |||
Federal | $ 113.9 | $ 64.5 | $ 46.3 |
State | 20.8 | 9.8 | 8 |
Total Current Income Tax Expense | 134.7 | 74.3 | 54.3 |
Deferred: | |||
Federal | 24.8 | 9.2 | 5.5 |
State | 5.8 | 0.2 | (0.3) |
Total Deferred Income Tax Expense | 30.6 | 9.4 | 5.2 |
Total Income Tax Expense | $ 165.3 | $ 83.7 | $ 59.5 |
INCOME TAXES (Schedule of Effec
INCOME TAXES (Schedule of Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Amount | |||
Income tax provision at the statutory rate | $ 146.5 | $ 71 | $ 51.2 |
State income tax expense, net | 21 | 10.1 | 7.8 |
Non-deductible/non-tax items | 0.6 | 1.3 | 0.6 |
Other, net | (2.8) | 1.3 | (0.1) |
Total Income Tax Expense | $ 165.3 | $ 83.7 | $ 59.5 |
Percent | |||
Income tax provision at the statutory rate | 21.00% | 21.00% | 21.00% |
State income tax expense, net | 3.00% | 3.00% | 3.20% |
Non-deductible/non-tax items | 0.10% | 0.40% | 0.20% |
Other, net | (0.40%) | 0.40% | 0.00% |
Income tax provision | 23.70% | 24.80% | 24.40% |
INCOME TAXES (Schedule of Defer
INCOME TAXES (Schedule of Deferred Income Tax Assets and Liabilities) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred income tax assets: | ||
Deferred Revenue | $ 139.4 | $ 0 |
F&I chargeback liabilities | 11.9 | 11.5 |
Other accrued liabilities | 2.2 | 4.7 |
Stock-based compensation | 2.7 | 2.3 |
Operating lease right-of-use assets | 67.2 | 77.8 |
Other, net | 10.6 | 10.2 |
Total deferred income tax assets | 234 | 106.5 |
Deferred income tax liabilities: | ||
Intangible asset amortization | (42.4) | (23.9) |
Depreciation | (50.7) | (39.2) |
Operating lease liabilities | (65.6) | (76.8) |
Deferred Tax Liabilities, Investments | (2) | 0 |
Other, net | (4.2) | (1.2) |
Total deferred income tax liabilities | (164.9) | (141.1) |
Net deferred income tax (liabilities) assets | $ (34.6) | |
Net deferred income tax liabilities | $ 69.1 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Operating Loss Carryforwards [Line Items] | |||
Prepaid taxes | $ 12,700,000 | $ 13,400,000 | |
Unrecognized tax benefits | 2,100,000 | 0 | $ 0 |
Accounts payable and accrued liabilities | |||
Operating Loss Carryforwards [Line Items] | |||
Taxes payable | $ 25,000,000 | ||
Other current assets | |||
Operating Loss Carryforwards [Line Items] | |||
Taxes payable | $ 47,000,000 |
OTHER LONG-TERM LIABILITIES (De
OTHER LONG-TERM LIABILITIES (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Other Liabilities Disclosure [Abstract] | ||
Unearned premiums | $ 24 | $ 0 |
Accrued finance and insurance chargebacks | 22.4 | 22.9 |
Unclaimed property | 4.6 | 3.1 |
Interest rate swap | 2.6 | 4.4 |
Deferred payroll tax | 0 | 9.1 |
Sale and leaseback liability | 0 | 7 |
Other | 7.1 | 4.4 |
Other long-term liabilities | $ 60.7 | $ 50.9 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | |||
Interest payments made including amounts capitalized | $ 92.2 | $ 62.6 | $ 91.2 |
Cash paid during the period related to floor plan interest | 8.7 | 19.4 | 38.6 |
Income taxes paid | 114.2 | 48.6 | 48.4 |
Loaner vehicles transferred from other current assets to inventory | $ 216.3 | $ 163.5 | $ 141 |
SUPPLEMENTAL CASH FLOW INFORM_4
SUPPLEMENTAL CASH FLOW INFORMATION (Schedule of Other Adjustments to Reconcile Net Income to Cash Flow from Operating Activities) (Details) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |||
Amortization of debt issuance costs | $ 2.6 | $ 1.8 | $ 2.5 |
Loss on disposal of fixed assets | (2.3) | 0.7 | 2.6 |
Other individually immaterial items | (1.1) | (1.2) | (0.3) |
Other adjustments, net | $ (0.8) | $ 1.3 | $ 4.8 |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Operating lease, right-of-use asset | $ 261 | $ 317.4 |
Operating lease, liability | $ 274.9 |
LEASES (Balance Sheets) (Detail
LEASES (Balance Sheets) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Assets held for sale | $ 7.1 | $ 0 |
Operating lease right-of-use assets | $ 261 | $ 317.4 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | PROPERTY AND EQUIPMENT, net | PROPERTY AND EQUIPMENT, net |
Assets, Finance | $ 8.4 | $ 14.6 |
Total right-of-use assets | 276.5 | 332 |
Liabilities, Current, Operating | 25.8 | 24.8 |
Operating Lease, Liability Held-for-Sale, Current | $ 2.7 | $ 0 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Current maturities of long-term debt | Current maturities of long-term debt |
Liabilities, Current, Finance | $ 0 | $ 16.6 |
Liabilities, Non-Current, Operating | 242 | 296.7 |
Operating Lease, Liability Held-for-Sale, Noncurrent | $ 4.4 | $ 0 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | LONG-TERM DEBT | LONG-TERM DEBT |
Liabilities, Non-Current, Finance | $ 8.4 | $ 0 |
Total lease liabilities | $ 283.3 | $ 338.1 |
LEASES (Lease Term and Discount
LEASES (Lease Term and Discount Rate) (Details) | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Weighted Average Lease Term - Operating Leases | 14 years 4 months 24 days | 14 years 3 months 18 days |
Weighted Average Lease Term - Finance Lease | 38 years 8 months 12 days | 2 months 12 days |
Weighted Average Discount Rate - Operating Leases | 4.50% | 4.50% |
Weighted Average Discount Rate - Finance Leases | 4.30% | 4.10% |
LEASES (Cost) (Details)
LEASES (Cost) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | ||
Finance lease cost (Interest) | $ 0.4 | $ 0.7 |
Operating lease cost | 33.9 | 28.2 |
Short-term lease cost | 1.1 | 1.5 |
Variable lease cost | 2.5 | 2.4 |
Total lease cost | $ 37.9 | $ 32.8 |
LEASES (Other Information) (Det
LEASES (Other Information) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | ||
Operating cash flows from finance lease | $ 0.4 | $ 0.7 |
Operating cash flows from operating leases | 32.9 | 27.6 |
Financing cash flows from finance lease | 0.1 | 0.6 |
Right-of-use assets obtained in exchange for new finance lease liabilities | 8.4 | 0 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 69.2 | 272.3 |
Changes to finance lease right-of-use asset resulting from lease reassessment event | $ (14.6) | $ 0 |
LEASES (Liabilities) (Details)
LEASES (Liabilities) (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Finance Lease, Liability, Payment, Due [Abstract] | ||
2022 | $ 0.4 | |
2023 | 0.4 | |
2024 | 0.4 | |
2025 | 0.4 | |
2026 | 0.4 | |
Thereafter | 16.5 | |
Total minimum lease payments | 18.5 | |
Less: Amount of lease payments representing interest | (10.1) | |
Present value of future minimum lease payments | 8.4 | $ 16.6 |
Less: current obligations under leases | 0 | (16.6) |
Long-term lease obligation | 8.4 | $ 0 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2022 | 40 | |
2023 | 36.6 | |
2024 | 28.6 | |
2025 | 26.1 | |
2026 | 24.3 | |
Thereafter | 229.4 | |
Total minimum lease payments | 385 | |
Less: Amount of lease payments representing interest | (110.1) | |
Present value of future minimum lease payments | 274.9 | |
Less: current obligations under leases | (28.5) | |
Long-term lease obligation | $ 246.4 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Millions | Dec. 31, 2021USD ($) | Dec. 17, 2021numberOfUsedCarsStorescollision_center | Jul. 06, 2020collision_center | Dec. 31, 2021USD ($)collision_centernumberOfUsedCarsStores | Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($)segment | Dec. 31, 2019USD ($) |
Segment Reporting [Abstract] | |||||||
Number of reportable segments | segment | 2 | 1 | |||||
Business Acquisition [Line Items] | |||||||
Number of collision centers acquired (in collision centers) | collision_center | 2 | ||||||
Revenues | $ 9,837.7 | $ 7,131.8 | $ 7,210.3 | ||||
Gross profit | 1,902.2 | 1,223.4 | 1,168.9 | ||||
Depreciation and amortization | 41.9 | 38.5 | 36.2 | ||||
Selling, general, and administrative | 1,073.9 | 781.9 | 799.8 | ||||
Floor plan interest expense | 8.2 | 17.7 | 37.9 | ||||
Other interest expense, net | 93.9 | 56.7 | $ 54.9 | ||||
Total interest expense | 102.1 | ||||||
Capital expenditures | 74.2 | ||||||
Assets | $ 8,002.6 | $ 8,002.6 | 8,002.6 | $ 3,676.3 | |||
Intersegment Eliminations | |||||||
Business Acquisition [Line Items] | |||||||
Revenues | (11) | ||||||
Gross profit | (5) | ||||||
Depreciation and amortization | 0 | ||||||
Selling, general, and administrative | (3.3) | ||||||
Floor plan interest expense | 0 | ||||||
Other interest expense, net | 0 | ||||||
Total interest expense | 0 | ||||||
Capital expenditures | 0 | ||||||
Assets | (49.7) | (49.7) | (49.7) | ||||
Dealerships | |||||||
Business Acquisition [Line Items] | |||||||
Revenues | 9,836.7 | ||||||
Gross profit | 1,901.7 | ||||||
Depreciation and amortization | 41.9 | ||||||
Selling, general, and administrative | 1,076.9 | ||||||
Floor plan interest expense | 8.2 | ||||||
Other interest expense, net | 93.9 | ||||||
Total interest expense | 102.1 | ||||||
Capital expenditures | 74.2 | ||||||
Assets | 7,289.7 | 7,289.7 | 7,289.7 | ||||
TCA | |||||||
Business Acquisition [Line Items] | |||||||
Revenues | 12 | ||||||
Gross profit | 5.5 | ||||||
Depreciation and amortization | 0 | ||||||
Selling, general, and administrative | 0.3 | ||||||
Floor plan interest expense | 0 | ||||||
Other interest expense, net | 0 | ||||||
Total interest expense | 0 | ||||||
Capital expenditures | 0 | ||||||
Assets | 762.6 | $ 762.6 | $ 762.6 | ||||
LHM Acquisition | |||||||
Business Acquisition [Line Items] | |||||||
Number of new vehicle dealerships acquired (in new vehicle dealerships) | collision_center | 54 | 54 | |||||
Number of used cars stores acquired (in used cars stores) | numberOfUsedCarsStores | 7 | 7 | |||||
Number of collision centers acquired (in collision centers) | collision_center | 11 | 11 | |||||
Revenues | $ 256.4 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - Guarantee Obligations $ in Millions | Dec. 31, 2021USD ($) |
Loss Contingencies [Line Items] | |
Amount of surety bond line maintained | $ 14.5 |
Reastated Credit Agreement | Bank of America | |
Loss Contingencies [Line Items] | |
Amount of letters of credit outstanding | $ 10.8 |
SHARE-BASED COMPENSATION AND _3
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS (Share-based Compensation) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Apr. 17, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of instruments provided for grant | 1,500,000 | |||
Number of shares still available for grant (in shares) | 1,500,000 | |||
Share-based compensation expense | $ 16.2 | $ 12.6 | $ 12.5 | |
Share-based compensation expense, tax benefit | 3.9 | $ 3.2 | $ 3.1 | |
Total unrecognized share-based compensation expense related to nonvested awards | 14.4 | |||
Expected future recognition of unrecognized compensation expense related to nonvested share-based awards, 2022 | 1.6 | |||
Expected future recognition of unrecognized compensation expense related to nonvested share-based awards, 2023 | 7.7 | |||
Expected future recognition of unrecognized compensation expense related to nonvested share-based awards, 2024 | $ 5.1 | |||
2019 Plan | Common Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized (in shares) | 1,590,000 | |||
Number of shares still available for grant (in shares) | 641,363 |
SHARE-BASED COMPENSATION AND _4
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS (Schedule of Performance Share Units) (Details) - Performance Share Units - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum percent of target earned | 150.00% | ||
Award vesting period | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Outsanding, beginning balance (in shares) | 194,486 | ||
Vested (in shares) | (79,582) | ||
Forfeited (in shares) | (58,097) | ||
Outsanding, ending balance (in shares) | 137,729 | 194,486 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding, beginning balance, weighted average grant date fair value (in dollars per share) | $ 82.70 | ||
Granted, weighted average grant date fair value (in dollars per share) | 132.52 | $ 96.31 | $ 69.67 |
Vested, weighted average grant date fair value (in dollars per share) | 71.82 | ||
Forfeited, weighted average grant date fair value (in dollars per share) | 95.32 | ||
Outstanding, ending balance, weighted average grant date fair value (in dollars per share) | $ 118.07 | $ 82.70 | |
Total fair value of performance share units vested (in millions) | $ 5.7 | $ 4.9 | $ 6 |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares that could be earned, range | 0.00% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Granted (in shares) | 80,922 | ||
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares that could be earned, range | 150.00% |
SHARE-BASED COMPENSATION AND _5
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS (Schedule of Restricted Stock) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Outsanding, beginning balance (in shares) | 102,593 | ||
Granted (in shares) | 72,732 | ||
Vested (in shares) | (38,818) | ||
Forfeited (in shares) | (19,760) | ||
Outsanding, ending balance (in shares) | 116,747 | 102,593 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding, beginning balance, weighted average grant date fair value (in dollars per share) | $ 93.97 | ||
Granted, weighted average grant date fair value (in dollars per share) | 150.38 | $ 94.07 | $ 0 |
Vested, weighted average grant date fair value (in dollars per share) | 98.31 | ||
Forfeited, weighted average grant date fair value (in dollars per share) | 107 | ||
Outstanding, ending balance, weighted average grant date fair value (in dollars per share) | $ 125.33 | $ 93.97 | |
Total fair value of restricted stock awards vested | $ 3.8 | $ 0.3 | $ 0 |
Restricted Stock Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Outsanding, beginning balance (in shares) | 98,630 | ||
Granted (in shares) | 0 | ||
Vested (in shares) | (58,028) | ||
Forfeited (in shares) | (2,067) | ||
Outsanding, ending balance (in shares) | 38,535 | 98,630 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding, beginning balance, weighted average grant date fair value (in dollars per share) | $ 68.66 | ||
Granted, weighted average grant date fair value (in dollars per share) | 0 | $ 0 | $ 69.18 |
Vested, weighted average grant date fair value (in dollars per share) | 147.83 | ||
Forfeited, weighted average grant date fair value (in dollars per share) | 69.20 | ||
Outstanding, ending balance, weighted average grant date fair value (in dollars per share) | $ 68.61 | $ 68.66 | |
Total fair value of restricted stock awards vested | $ 8.6 | $ 5.1 | $ 5.1 |
SHARE-BASED COMPENSATION AND _6
SHARE-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS (Employee Benefit Plans) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Maximum annual contributions per employee, percent | 75.00% | ||
Maximum annual contribution per employee | $ 19,500 | ||
Employer matching contribution, employment requirement period for matching eligibility, minimum | 1 year | ||
Employer matching contribution after one year of employment, percent | 50.00% | ||
Employer matching contribution, percent of employees' gross pay | 4.00% | ||
Employers matching contribution, vesting period after date of hire (in years) | 4 years | ||
Employer matching contributions | $ 5,300,000 | $ 2,500,000 | $ 3,700,000 |
Age 50 or More | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Maximum annual contribution per employee | $ 26,000 |