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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