Avis Budget (CAR) 8-K Results of Operations and Financial Condition

In conjunction with a change in the Company's management structure, the financial results of the Company’s Zipcar operations outside of North America will now be reported in the Company’s International segment, rather than in the Company’s North America segment. In addition, the Company has revised its definition of Adjusted EBITDA to exclude restructuring expense, to be consistent with the manner in which management assesses performance and allocates resources. Adjusted EBITDA represents income before non-vehicle related depreciation and amortization, any impairment charge, restructuring expense, early extinguishment of debt costs, transaction-related costs, non-vehicle related interest and income taxes. The Company's consolidated results for the year ended December 31, 2013 are not affected by such changes. The table below illustrates the impact of these changes to Revenue and Adjusted EBITDA for 2013.

Avis Budget Group, Inc.
Segment Results
For the Year Ended December 31, 2013
($ in millions)
	As Previously Reported
	Revenue															Adjusted EBITDA
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year			First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year
North America	$	1,100		$	1,292		$	1,513		$	1,178		$	5,083		$	90		$	114		$	223		$	73		$	500
International	515			608			773			586			2,481			14			53			144			29			240
Truck Rental	76			102			109			85			373			(9		)	8			13			3			15
Corporate and Other	—			—			—			—			—			(12		)	(11		)	(11		)	(13		)	(47		)
Total	1,691			2,002			2,395			1,849			7,937			83			164			369			92			708
	Adjustments for Segment Reclassification
	Revenue															Adjusted EBITDA
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year			First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year
North America	$	(2	)	$	(13	)	$	(13	)	$	(13	)	$	(41	)	$	—		$	1		$	—		$	—		$	1
International	2			13			13			13			41			—			(1		)	—			—			(1		)
Truck Rental	—			—			—			—			—			—			—			—			—			—
Corporate and Other	—			—			—			—			—			—			—			—			—			—
Total	—			—			—			—			—			—			—			—			—			—
	Adjustments to Exclude Restructuring Expense from Adjusted EBITDA Definition
	Revenue															Adjusted EBITDA
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year			First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year
North America	$	—		$	—		$	—		$	—		$	—		$	3		$	—		$	3		$	1		$	7
International	—			—			—			—			—			3			6			5			19			33
Truck Rental	—			—			—			—			—			4			9			6			2			21
Corporate and Other	—			—			—			—			—			—			—			—			—			—
Total	—			—			—			—			—			10			15			14			22			61
	As Adjusted
	Revenue															Adjusted EBITDA (a)
	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year			First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Full Year
North America	$	1,098		$	1,279		$	1,500		$	1,165		$	5,042		$	93		$	115		$	226		$	74		$	508
International	517			621			786			599			2,522			17			58			149			48			272
Truck Rental	76			102			109			85			373			(5		)	17			19			5			36
Corporate and Other	—			—			—			—			—			(12		)	(11		)	(11		)	(13		)	(47		)
Total	$	1,691		$	2,002		$	2,395		$	1,849		$	7,937		$	93		$	179		$	383		$	114		$	769

__________

The sum of the quarters does not necessarily equal the full year due to rounding.

^(a)The following table reconciles Adjusted EBITDA to Income (loss) before taxes.

Reconciliation of Adjusted EBITDA to Income (loss) before Income Taxes
	First Quarter			Second Quarter			Third Quarter		Fourth Quarter			Full Year
Adjusted EBITDA	$	93		$	179		$	383	$	114		$	769
Less: Non-vehicle related depreciation and amortization	34			37			39		42			152
Interest expense related to corporate debt, net	58			55			57		58			228
Early extinguishment of debt	40			91			—		16			147
Transaction-related costs	8			19			10		14			51
Impairment	—			—			33		—			33
Restructuring expense	10			15			14		22			61
Income (loss) before income taxes	$	(57	)	$	(38	)	$	230	$	(38	)	$	97

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