Earnings call transcript Q3 2022

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Operator

Greetings, and welcome to the Avis Budget Group Third Quarter 2022 Conference Call. At this time, all participants are in listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host David Calabria, Treasurer and Senior Vice President of Corporate Finance. sir. you, Thank

begin. You may

David Calabria

everyone, and joining morning, you thank us. Good for

with On our Ferraro, me our call Chief Chief Officer. Choi, Joe Brian are the and Executive Financial Officer;

we would future and materially statements section potential in performance, to that which the risks, remind begin, uncertainties could information, forward-looking to financial such like release subject periodic and our and and identified we discussing forward-looking factors I everyone are Before differ that Investor uncertainties will website. is risks the assumptions, cause be from with information. including and results other as earnings to assumptions SEC, of other filings well Such as actual our Relations

actual may obligation any forward-looking or about results of forward-looking our statements no to can We prove all undertake and no to upon forward-looking Accordingly, not of be or statements should inaccurate future performance. guarantees relied statements. make update and be our we our prediction as revise a

On how this for to comparable is website certain our the measures. call, reconciliations measures available on to release, financial discuss earnings and measures. press our closest we define which these will we GAAP Please refer non-GAAP

turn over the like Joe. to I'd that, With to call

Joe Ferraro

us morning, thank everyone, you, Thank Good David. you today. for and joining

for Yesterday, EBITDA sixth that history, quarterly given consecutive we reported delivered results our adjusted our quarter. company's making earnings we this best in our record-high report, where

dedication shown over drive half a has our continuously incredible and For setting year a benchmarks and by team new quarter-after-quarter. now,

decisively healthy we cost robust maintaining selling on materializing by our and bookings just acted possible. I we call season busiest Budget stringent age who thanking XX,XXX I've the to generate and Avis the with seen rely start-off quarter, summer Group, to by both earnings. said, this this make for ever in employees gains want fleet I as rate. in We travel do, usually But I were helped solid a strong demand discipline. didn't of demand Last

a result, quarter quarter. combine second travel adjusted record any history. are excellence, EBITDA our is operational sequential the the you third in adjusted of over quarter When which growth our That's EBITDA, this XX% in in adjusted billion for high favorable the previous $X.X company's a with XXXX environment EBITDA from

begin us far This XXXX, $X.X of in $X which at billion full And EBITDA still third have of let's EBITDA But to of quarter adjusted adjusted the puts fourth highlights the with fourth, let's and segment. we XXXX. $X.X billion already for go. through quarter talk over the our the the than we thus before Americas is results more usual about year record as billion go

to strong given was Americas metrics was in segments results able volume to second build-up billion The for is business reflecting a the EBITDA all that is in levels. our XXXX over segment the second over well quarter adjusted generate This and humming. continue time that operation with both across and Travel $X commercial strong a quarter. Americas leisure demand alone

in company. find where XX sequential the we've safely road. XXs parts operating rental low back We're the This chain in on cars our to a record resulted quarter. the This work our to and way of recalls wouldn't customers strong meet able a OEM third servicing who back a shortages demand our in get to the our of been overcame been million the utilization historically increase to days by for in quarter, without have team possible over the supply

don't quarter, RPD tells but whole up from story. was believe I the down second and of year-over-year slightly this the $XX.XX

on to quarter. While feel this provide some we into month-to-month typically do don't RPD, get of the important I color results it's

lower coming This us. implies with dynamics. welcomed us to and mentioned and seasonality normal stabilization trends. August. month-to sequentially than in industry to continue normal demand allows month in than happens September in in supply summer this July is efficiency, I what new last by that quarter sequentially and which normal That's our a compete in we lower on That operational a RPD RPD to call, see started On return RPD coming August

well Commercial and business was the powering levels signings above demand. new Day midweek robust post strong Labor XXXX especially of in the quarter, with accounts and partnerships

However, allowing of up last even pricing the for in month September rest good of summer, the was with exit more year September versus corporate travel compared the trends. in

vehicle out arrival on that executing of the said our our older August, out demand. on rotate fleet, and return Back proper with while customer our our to with capital macroeconomic Moving fleet invested laid order newer the fleet, to fleet call. last on trim strategy align we I in are continuing we and of given size we on in uncertainties ensure a to

And gains at healthy what to summer. exactly the throughout exit did vehicles that's relative able net were to high we We book value. mileage the

get quickly favorable used team market while of I'll allowing Excluding car fleet in quarter. more summer tirelessly around vehicles but we sold to business topic the window period peak a volume. the wanted early for fleet mobilizing throughout normal have handle take the and acknowledge number the Americas' part to fleet to in quickly this working during most our advantage enough of to the is this COVID, detail into of section, the I

the of same . Americas, to year-over-year incremental income margin million XX%. statement the by by EBITDA for an adjusted increased revenue million of period $XXX metrics. Americas roughly $XXX during increased on In Moving these results the

for margin by If of revenue the an you $XXX while recent by million XXX%. most increased Americas to results XXXX, EBITDA roughly $XXX of compare third our incremental million quarter adjusted increased

to approximately demand. advantage used market while decision our disposed results car proactive to $XXX contributed we on of million take our saw robust a reflecting vehicles Gains

the segment to bottom focus fall excluding However, in benefits with environment revenue in quarters all still it's costs power even allowed earnings the fleet line. evident the of recent gains, a impressive. car objectively prior Consistent our that around our is used strong to Americas

a lean and segment nimble, was believe results quarter focused. This historic the showcase the exiting that's saying we're Since been company. for era, we've Americas a the COVID business transformed and a I

of. Americas This is reflects team quarter what capable the

which move our our to International an season as had historic but International I've up of The and recovery segment, as well. over quarter. second summer let's strong consistent took robust in on segment outside quarter our EBITDA message, control that, returns. sets travel revenue advantage With the cost international quarter full the for in a stringent been built a team third a

versus due hampered believe XXXX airport rental to our were team cancellations, as with days constraints significantly we third quarter was serve While days international of rental RPDs. flight and the higher more XX% able to

generate most tight $XXX segment the was adjusted the international higher to to almost with exchange, able and year believe means will profitable EBITDA contributed dollar, international quarter strong company's that currency we grow. much million over EBITDA. full of resulted segment the in that, of RPDs to control strength in demand return This despite our in of foreign continue cost with prior The travelers, combined The one U.S. inbound than team million adjusted from $XX headwinds as history. of any the

first reach segment. acquired from of our International advantage. of would of Europe first magnitude we million way. adjusted a quarters $XXX EBITDA XXXX, Americas the In of in we Avis competitive roughly the three generated adjusted be We $XXX illustrate me transformation true because believe XXXX, In in generated of million three sustainable global segment roughly the the our EBITDA. this XXXX, another quarters Let

matter asset in other no rely in the quality over that No convenience matches infrastructure our The where this and consistent past car quarter rental built our ensures years. we've how investments the can footprint valuable made global world XX travel. results the on company we've demonstrate network and our customers they

the Moving fleet segment. size basically the quarter, focus more flat in on our from vehicles third. to vehicles average XXX,XXX the are with consistent to we'll second the we quarter fleet, the Americas, moving XXX,XXX on Americas quarter in In last was in

aggressively mentioned vehicles dispose earlier call, we we took new high of in mileage vehicles. As summer as of on the delivery throughout the

I've of what the do. is at we heart fleet always said that management

advantage demonstrates its the the highest. our of quickly car was size agile we quarter In XXXX. can market quarter quarter first demand at average be the in higher strong XX% how This of while used was taking first fleet of XXXX,

fleet of than the fleet third was third In quarter our XXXX. than the higher of XXXX. quarter, average second higher The size quarter average XX% was second quarter, XX% the our size

during So the growth first three to XX% of has quarters the this slowed year. to XX% from XX%

Our objective. objective to achieve return to size our on optimize is invested We fleet capital. to demand order match in that

Americas For our in to take we've sequentially fleet demand. pent-up the advantage of five travel the past quarters, grown

done in in However, to return of to we a given years sequential uncertainties, capital, the the macroeconomic supply with from we Americas' return believe quarter. invested and consistent mounting stabilizing on will manage decline seasonality historically order normal fourth in we've fleet what need to optimize industry third pre-pandemic the

we million $XXX would have the gains in quarter dispositions sales by We quarter. across from pulling that in typically roughly fourth third the had and spread forward

adjust the in of $XXX you straight-line third gains, you'll quarter quarter over increased $XXX the see fleet If from depreciation in our has XXXX that of for to XXXX. second

vehicles deplete model to the increase. current you'll inflate we As year older and vehicles, see straight-line model continue year depreciation

quarter monthly quarter, we given remarketing our the for along fleet fleet currently Also, the conservative our per straight-line for believe in in costs market used The we our the to fourth decrease depreciation for initially account significantly will quarter. fleet already flux, expected be nature third the similar of gains strategy in gains car harvested quarter. how assets, but we fourth where monthly next with given we've we that the is will unit ceiling

on wrap me comments buy. Let our the a fleet up with few XXXX section fleet

fleet have be at and pending. shortages vehicle been of along believe we fleet the a evident of more will do and is with chip place parts with OEM we are many visibility in our productive portion while While and terms have XXXX very And availability still buy our have still buy partners. of contracts industry in time, delays allocations we Conversations tight. supply, this

of a our as approach and are use our fleet buy terms return stewards of largest this purchase to price the vehicles in of our our of capital number are those taking Therefore, we responsibility purchases in that realize Fleet and vehicles. XXXX we both optimizing is for business on business. that measured of capital

world. and partners in order customers new around to taking mix broader our rental makes OEM with our the to an of showcase are vehicles of lineup We models a exciting on

make get our won't will into figures, of growing new vehicles XXXX we fleet electric specific buy. a while up And portion

said vehicle strategies. targeted vehicle When want use talked to this of I our to and discuss on maintain follow economics our implementation I've important sure life of demand, stability values. a and Next, residual utilization vehicle about we maintenance last ensure to the of life progress electric to purchase throughout the consumer the very cycle year, it was I from make end

infrastructure the in our locations with out We've been to-date progress our many build required hard our our working am with pleased plans partners to and and I of forward. going

number We along the fleet by plan extensive public demand location, of modeling and the determine from to and charging an units exact anticipated municipalities of needed city and airports to week size laid execution to levels the have of out get done rental both utilities. by day with

in we with a our ability operate maintain with will EVs confident we've consumer exciting to and an ready vehicles the and hard are service of and It's take our to time to OEM to working this follow. in purchase and the portfolio our pleased We preference. been diversified change partners this ability be year years and on are

airports. Avis our technology, offering majority increased to QuickPass our we on at Moving of a

to this with of if exit. gate car product, automated proceed customers exchange car rental technologies. return, the an to car their to their utilizing own a and select directly their for unfamiliar code those our Upon utilizing they connected drive out or on it phone, vehicles their from the customers enables our exit close QR their on can even For choice like

experience. responding to XX QuickPass promoter Those and are contactless favorably Avis utilize scores. customers score a higher points this on as free net stress Our that

a telematics after are gallon, As I allowing and rising each calculate the Gas gas. vehicles of of - us early tenth our registered the of to time, in into were down cost neutralize rental we to mentioned core adopters readings our last of and before systems. vehicle operating

operating fleet used lowest getting several intuitive pressures more now reduce are results demand significant systems improvements are our for to levels our price is DFP, wage the pricing and years allowing in Productivity both good notification forecasting system being supply driving demand use and to labor seen location continually down optimization. we've and and in demand performance.

We drive and expectations. with will our both existing exceed to further enhance customer our to integrate processes results ability continue systems operational our and to customer

team strongest double-digit and achieve. a saying over again wrap-up I the We summer by September demand with of was am once season. So we results to I'll pause been the and September on at prepared year. last here able how remarks terrific my record had our proud increases have

commercial greater with to Fall over entire start And we operating remain run-through leisure tape reported a XXXX. make the and off than optimistic and billion in conclusion, is trend intensity the is we sure $X.X EBITDA holiday both year last the our around in bookings great to organization we with and months to XXXX fourth-quarter. nine season. be of our adjusted In

With turn it outlook. to Brian liquidity our that I'll to our discuss over and

Brian Choi

everyone. Joe, you morning Thank and good,

near-term to I will in reconciled now focus adjusted start-off My outlook. from will I'd addressing today allocation. our press the on GAAP results, numbers by capital our which discuss liquidity comments and release. like our our are

the the as significantly slowed into As our third you'll that second quarter recall quarter repurchases of and continued share well. pace in

the Only both We X.X flow June, summer $X over retired trading summer XXX,XXX shares in million of average towards wait-and-see our the August July strategy XX of repurchase approach were dynamics price to the cash from levels to and stock. an deployed billion $XXX. the at over pivoted May, a quickly months of days and shares end of and reflecting

reported, last of million. an current of we retired XX.X shares, this consistent opportunistic we additional XX% since share to was example our be our count that quarter our been bringing saying means in an we've That repurchasing that. in We've shares outstanding

We standing continue find history the in ourselves company. strongest our in the of position the privileged financial of to in being

vehicle $X.X billion LTM grown our adjusted adjusted quarters, XQ, billion from lowest than as Which one history. of quarter began EBITDA billion now $X.X XQ, in first of ago XXXX and in four of $X.X quarter billion sit $X.X XQ, means XXXX, of leverage EBITDA. that in XXXX, ratio billion the net $X.X has LTM at since to our $X.X past times, company XXXX brought billion a invested back to we've the pandemic less our third in programs the the repurchased the and XXXX XX shares, in quarters In into to we in

we with As billion our in $X.X facilities. liquidity of ABS XX, additional capacity of September available of $X.X billion had borrowing approximately

the in with XX% of of in is maturities of on beyond corporate maintenance world with Our well we approximately secured around headroom as of corporate our debt with laddered, our facilities compliance significant covenant are debt or September. all XXXX and our end having financing tests the

on Let's to outlook. move

make as As changes. a you fourth environment we're of currently management on a annual business decision decisions know, made allow giving as ourselves to do we've formal team what color for But to quarter. forgo the seeing provide want guidance agile the the flexibility I to the to bit

is will demand both call, we in mentioned fall earlier season. Joe holiday segments, to normal optimistic the for the the continuing on and through Americas seasonality the we're As but travel see robust, International this and are continue

RPD XQ forward decline 'XX to to we the sequential gains, will be per-unit 'XX. sequential pulled will Americas, costs to benefit the closer normalizing reported fleet to the saw fleet XQ In Americas expected in be the we so We per a with basis. $XXX be 'XX from XQ month decline to 'XX on believe similar RPD XQ in

change will segment, from out will I'd One In in per our mix 'XX vehicle unit our believe and that travel expense due 'XX. like XQ prior fleet with to returning notable slowing, both to flat costs XQ relatively International in interest and RPD be point line. year leisure business be we

made one-third on variable rate debt $XX interest million expense $XX we you debt full be by and where rate absorbing the should floating sequentially to of million quarter. As Fed the variable of fixed floating on vehicle increase our notes. which roughly quarter, report. in two-thirds in notes were our versus we further up the know, hikes guidance is our next impact We'll when give interest third We'll full 'XX vehicle fourth term year

will vehicle debt what headwind we'll continue much deep So debt, rate for offset use, exogenous magnitude into alone tranches this equity rate for to interest interest as how tranches the environment, advance vehicle these the adjustments go optimize a going we rates we internal burden forward. rising the have of fleet cannot trip we our term fixed term interest vehicle In we But to programs. be our increases. operational refinanced and on how fund of

only can't believe our to appropriate capital we two require ways hikes Two, have hypervigilant costs in interest are Reserve, in when control. responsible this we the for all the there that from we We the headwind. this address if remain deploy. additional One, are rate to we factor cost control the return around macro have to we Federal evaluating

been Fortunately, and say the two That's that's we out have pandemic transformed ago, we so began discipline and these doing will to that we're we've full company. continue both confidence what our demonstrate I dimensions. since day mean across in years excellence ready. day team exactly over a we're what when

I In set the years, In each a EBITDA as previous XXXX XXXX, from reflected for XXXX, That quarter fourth the from XX% we've upcoming floor XQ years in year fourth for of call of was major this times We've gives that a mean most what in is quarter. all our the variables seasonal know think with all business return where of business on we're normal quarter. the is adjusted quarter. car But adjusted rental third fiscal fourth that several peak quarter of fairly the and of pre-COVID being the is and XQ we third for the see you drop-off mentioned sense the EBITDA? to this the normal XXXX. seeing those we does a ourselves in that seasonality consistent. for down

vehicle point, let's at deliver in we adjusted million are generate we'll that, more So EBITDA $XXX in $X EBITDA despite adjusted full in it which for believe means next we for depreciation, targeting monthly open With this up quarter, that to year that approximately than the billion difficult sequential questions. XXXX. comp

Operator

Ladies and you, Brinkman question-and-answer The JPMorgan. first now question gentlemen, we from is have a be will we conducting Ryan Thank sir. from Instructions] [Operator session.

Ryan Brinkman

for portfolio, the to of maybe park liquidity, earnings to taking question. to place level think With Or reducing more going regard forward do for as, in leverage. example, interest Enterprise we equity Thanks vehicle expense? a intend decreasing my different an Should equity I efficient has? vehicle Great. as this you investment fleet with fleet such the operate regard of the

Brian Choi

Ryan, this. efficient place nimble going double to cash factor here. on a into park side, definitely to this we it about reduces It We're the One, is our Brian be program -- which we our which vehicle interest vehicle it also is benefit. EBITDA. Yes, fairly leverage is because have expense reduces and

out been vehicle the proven on we've during sheet. we've flow it can balance the But of the -- in as that So putting cash vehicle in pull parking versus and programs the excess quickly in cash program. as cash pandemic, we

So keep nimble we're not want to We're that. over we we exactly going setting with to there. what levels fairly how be fund

Ryan Brinkman

Okay.

think of that include et less Board that would billion EBITDA. year, was a wouldn't of prices get the remember as at year EBITDA ahead demand the level normalize the imbalance to investors may the just attempting arms and questions I as be is key of I company cars said potentially than their used for $X are accept the I and of plan vehicle it Directors cetera? current lower, around think of when supply the for what normal new cycle you rental one past we last

estimated be be? how year the XXXX, -- in a when was about analysts may of was billion, Here, position earnings a what maybe year, And $X or might billion so? thinking you that Or earnings than start you're that might billion $X.X that out-year do that of ago fact you the the by I go you the believe the the comment to normalized of potential higher expected or on XXXX business reason $X is that? $X think the you you're was in billion. doing at instead think doing think Do expected to that

Brian Choi

decision guidance Sure. of We've Joe for thoughts. I to one made year the forego don't the start add management team giving out. formal Ryan, and why can his

definitely what rental path I'll our glide settles back XXXX that what reset materially So gentle this in Or look seeing Is our is drive XXXX? normalization And than business, key in longer But levels? runway call. a you giving hard mean? level like? guidance slope a like towards values. what said with said, long-term not that But days, call. RPD, does make normalization remarks, have the to is, we're your variables the it used on reiterate we car a does question prepared normalization You'll Joe? a higher to it at we're

Joe Ferraro

that XXXX, now seen. than Brian, some Listen of as company we've were we Yes. different of can action see by we've you some in the that a we're the taken growth

And manage should be certainly on it sizes fleet be our our be. with we'll comes demand cost so prudent in when to vehicle line and our we how what

We've taken past of couple a lot of action on cost years. control over the

things used So level that volume our technology nature, us We both the our help capacity. the side and the as side. managed to of we to but to of of a of as business well lot cost in due a pandemic business administer credit operate different

Ryan Brinkman

tight lastly, balance to supply say a you in and rental a Great, cars all I'm return I recalls. heard to comment that may of more lingering States? shortages when just on don't know was I impact you say thanks. And going remain the for XXXX, think you normal the fleets and of of curious chip I if forward. if that demand view you a think expect given then United have just

supply for asset it's cars, with for the itself. the talking not to houses mean, I hand, buy the were that revenue asset. right? track would could the were rent like so think you There's and amount any about if you vehicles simple, more we're as able it line On does in think I tracking? third should decline rent which asset in price, seem other that per demand or during of how asset about I And But course, think to it day the quarter. we may And the whether value. you

demand rental trend important So I line about where with into you you prices should factors vehicles more the day, cars? tracking or consumer the per RPD we give of more the the think what do or supply trend for revenue does forward used with of in going line 'XX it for are think out? to and shake enter but guidance expect most don't we'll in

Joe Ferraro

I'll me the off with - fleet start let Okay, start with the off side.

we've XXXX - mentioned last it as as and I So not had frankly. up a year, prepared fleet nature remarks, my size, this the in earlier to seen to just on XXXX, We in demand And of and aggressively seasonality. us. that's we leading normalization spent cars increasing than call pertains depleted all our due we to business trends different the very and of

at existed most second fleet. the and is the the about very the XXXX. I level quickly that a than thus and starting to XXXX. the business, higher early to the that some third. that of manage normalize But through think the majority the the fleet how And our say July But much level. the that dynamics, in seasonality we fleet have higher we I things bit saw most month were would at rental days most saw part industry think and the a quarter a into we you we have if

to then fleet And the through as down you of the get sizes - the taper year. remainder start

and new the us the good regularly in we dynamics pandemic quarter. here. this allowed of that business fleet to vehicles past we - used one rotated the number the quarter, exited year, a probably certainly really year did cars. strong This aspect since fact in take of arrival one with to this add advantage the other that's most our And of this that You car we quite interesting the

next trend is into some of And see least have continuing that that seemingly say the very strong. we we see going still year when And continuing. - pretty have to early visibility. at out good we But I demand part

on September said, the September busiest So as of month I was the record.

as talked having factors airlines are that well about differentiated of a Some seen a number the There to September. that. of

pretty from Our working lease business. with a, level remotely We've contribute I others, in couple help disappearing. see that's of forward. seen for a maybe going that leisure associated a see of maybe strong days of business was And there's increase don't commercial and for significant what home people and growth. those influx trends we business to

do from and believe based get be our that as going partners next that we do what I tight on the our insights As far into I size, OEM fleet buy our with year. fleet will allocations

during guess. But you year Now we those anyone's year what mid buy the year that stocks happens XX-model next the and is course see now, the as know, of - dynamics right we those that commercial elevated price? was some that a in and what and Price had allocations to being year comes, pretty tight. month happens With compared to September prior significant improvement.

a pretty go-forward certainly going for elevated on demand seems Looks high. basis our like price way and to on the the company is be rest of

deal our a we So October, a dynamics continue. to but fall precursor coming we seeing great doors, winter of and through are I - good we're thought our good was it demand season really see those was

Brian Choi

one to that factor to just considered. is car we Ryan, that, So used the prices just add

vehicle the going are our our up, all in expensive. we're that getting structure and labor costs interest mentioned highest more across remarks, are we've cost I seen. Assets inflationary in prepared just environment

we're maintain assets an that industry, and expensive, So across to getting - appropriate to for entire higher on so require that's capital. true invested we all our believe - return going prices are more

Operator

Adam from Morgan is [Operator next have sir question Stanley. from we Instructions] you, The Thank Jonas

Adam Jonas

me? hear Can you everybody. Thanks,

Joe Ferraro

Yes.

Adam Jonas

tell fleet question can actually EVs. your percentage of you guys My Very you're us right impressive not to on EV? first doing. on I now, are targets, the work know you but is - roughly what elaborate you're going is

Joe Ferraro

Brian I say will here's that, on that our Adam. I'll say, we fleet have take EVs what so currently. I'll

with that fourth our cars EV pleased in to in - not receive cars. into EVs quarter, are go to quite fleet. year have for going do the next we we that number We exact various and our have scheduled I'm for don't the of purchases We

models and a variation offer which, OEM and normally going fleet all conversations had to our with general in gives from know... partners, OEM we've But you to us public cars as partners. our of - We're makes good different do we all get the

Adam Jonas

believe. I

Joe Ferraro

Okay.

Adam Jonas

That's okay Joe.

cut I Joe going? Sorry, keep you mean off to

Joe Ferraro

believe believe takes up on we the us airports. expense for environment per our revenue that to which, rented our it's best at you And day, No, the I we minutes. most the best our investment, system gas the it we the as that car, important best return challenging EV execute know, We on our run control. is get strategy XX

to how car. So we knowledgeable have pretty take will it do pretty, long an to be EV

we generate our suppliers the best that And lot as the would airport knowledge, number any time did car at day, what any incredibly with started of our with will and and number any process we've to good given implemented given rented. when and the cost spent good we've say, to a a we and be have be months that quarter determine of have going come. in action. inventory and software in this time, to our a So I thought And investing to that modeling given contract to week said, into EV and next some businesses, quarter, providers we

Adam Jonas

half risk also guys your if analysis up leading mix confirm Thank your for the just that's or strategy now? versus with. a EV you, agree you remind don't Joe. combustion I program detailed XX% costs your right something EVs know follow-up, that broadly you OpEx or said great to as internal could competitor maintenance And And something is like job. just can me Hertz in car. and Thanks

Joe Ferraro

Program you. entirely thank mix EVs risk. versus Okay, entire - on is

if matter fleet of that helps. fact, risk risk for as program total As a our versus majority

gas early, As a rate are we you rate determine very per I'm day seeing far overall what is to benefits, seeing But really we put as maintenance it's trends a car. going right? gas normal we're a than But tell day the be. per would Adam, and to the car, early it than net higher higher normal

that about more talk as goes I'll time So on.

Operator

Deutsche we next is Bank. Chris sir you, from [Operator have Thank The from Instructions] question Woronka

Chris Woronka

and morning, Hi, quarter. great another good guys, congratulations on

and side, right? pivot we different know you a So you how little And a how But on does bit your beat fleet, guys economic to decisions dead bit horse true quickly if going - on to, pivot or of of can if and can kind next conditions my can maybe very purchase commitments, to? need of on especially question commentary you a purchase macro not you change, little that's quickly the need direction. the a maybe quickly if year for But on view us you the so? sales give the really

Joe Ferraro

pretty significant happens proved - and Well, we enough to if were we've do I you're this up, cars have volume take past we talking advantage certainly that. what as demand goes year to able about of that if think

ability So to quite fleet up. pleased I was our with

- as other far As pushed put see months out for get think manufacturers I deliveries, in insights spotty. months. to we from orders about those orders certainly what There delayed or we are still it's and and certain

the other that Like as So should time in things we the fleet we said, We've manage deeply have this this did out we've on far certainly as quarter, sales cars did pandemic to how quarter. out of we in as we the years. XXXX than day-to-day proven you probably if any and third very taken be even to turn way, nimble more quick we take XXXX, quarter our assets. pandemic and in the recession are the during fleet I

quarter, high So - and in this demand. had rental we

rental to cars, we de-fleeting the when and logistic both. with do able demand challenges So that's you were associated combine high

that. So years the I proven to feel that we've our over ability exercise

supply that team to juggle our able have certainly leadership team multiple a organization chain We strong field strong is initiatives. and in a

the said, getting industry for think So be will do the allocations fleet a that basis, we will be tight. being the that go-forward on I dynamics

Chris Woronka

I do Okay. I million. Thanks quarter my if current think I down mentioned Obviously, around your what if And at the to is XX.X smaller. Brian which comments look -- count becomes share a just helpful. try from triangulate a think even and more like it's being around share perspective shareholder, follow-up we the level mechanically But it your float getting think is, stock question the Joe. That's level you be, my And floats the difficult would buy a then point to opportunistic might approach with fourth is math to is repurchase. there a big attractive? at there

Brian Choi

that don't That's can here. we been want we we it's we've true think quarters Brian when so. now, for want. and the many proven shares get Yes, Chris, to, I go

contribution, saying share formulaic in paydown as that seen focused any of front. debt seen corporate So given be also this well. issue We're just been not interest equity quarter we've And we've in repurchases to on you've and said, terms going not we're as consistent and I on in rates, macroeconomic like fleet general uncertainties.

see But about permanent listen, to when opportunity not through we're shareholder shy repurchases, it. create value an we

the the So and to it with to continue timing both to we're comes going when nimble repurchases. magnitude be

Operator

have from Thank The question Stephanie sir. we next Jefferies. you, from is Moore

Stephanie Moore

the expectation. side, travel cause differ? XQ return Hi, on of the you're and from dig in good seasonality that a in wanted what a to bit a morning. seeing potential on XQ about is more little to normal kind XQ commercial business I rebound to to color further business I the could there appreciate

Joe Ferraro

to a that's Yes, are travel commercial great travel reporting organizations in compared Most Joe. question. declines 'XX. is This

We that. defense actually are they in contracting, more robust have not in of tech it government, associations quarter, are seen Trade together the logistic aerospace, having meetings. companies, September. maybe are seen getting now month frequently growth the was in than in had meetings, We've and especially pandemic probably organizations very companies, prior. and Companies the terrific having

more of in did And everything everything a used like If a were be the in those involved around our there's operations states into beaches to cities. of city was lot you those centered places well doing It the We've and week. think that the that was the weekend. in around seen activities. well. pandemic, it that resurgent centered now middle are quite Well, very leisure

trend though revenue equally of have the Thanksgiving came that that don't support we peaks enough the that holidays generation business. important we periods, of out see are I shoulder that quarter, as significant in dominate that us there which the in which gives fourth to the even changing to just tend are in confidence quarter. And Christmas, the and and asset utilization

bullish on our I'm believe. So I trends quite commercial

Stephanie Moore

your in of aggressively quarters? I'm out just to more and little the than between into appreciate couple the the the I strategy week what that bit more the two. a And take bit to Great. then and demand and No, you just of cars kind through with season. reconcile play third have seeing you maybe decisions of in How kind of little the throughout does shoulder a maybe more of de-fleet quarter a the over kind last of more that. bounce kind trying walked of the

Joe Ferraro

the Yes. also both I we both mistake would do and in fleet we off -- sown. that about trim make volume no it, we had drive to size saw wanted -- and quarter that rental our certainly

years. we is It's think over When didn't during have that it's just consideration use asset sell. the the thing about course that to asset. important in fleet period that fleet it's think fleet about that to a previous do the I into We And our rotate the normalized of not the probably costs time, actually of long or you you car we in third buy tremendous the a how do and to opportunity out. take saw time, quarter.

of higher to seen at an over cars high. rates haul But fleet that than and significantly ever made do mileage sense were insulate was probably the vehicles. and exit for costs the to our lot The higher all-time and we it long used a demand ourselves some

fleet that on same the what do day and put that have drive infrastructure the see right as well. we we to take always rental that size advantage the business opportunities to pressure will of in ensure We marketplace the

Operator

you, Thank from [Operator is sir. Healy have Northcoast. question next we from Instructions] The John

Unidentified Analyst

everyone. on for is [indiscernible] morning, Healy. good Hi, John This

Joe Ferraro

ahead. go Yes,

Unidentified Analyst

much guys was can in kind you understand ABS or like your into for at outlook service the in you this. how have cash the facilities reallocate look Good But ABS morning. touched at residuals, you on meaningful little market what the to collateral? time in joined us if I would to of to cause a Apologies, help more late. you equity decline sure of I not as you what levels structure

Brian Choi

We're we've public, in we've like in there position more the there's best ever since gone been ever the programs vehicle in than actually before. equity

press the look with do to and see debt the I assets is it you'll what think see to the programs at you'll vehicle -- that is. against ratio way release, with that under easiest the see vehicle programs,

efficient we cash to capital just place And back flow the mention that on park because excess into we've deployed been other that allocation we of call haven't funding sheet. in earlier free than more vehicle did balance cash the areas programs it's on a

Unidentified Analyst

Thank you, helpful. guys. Super Great.

Operator

floor At Joe are comments. no sir. you, over the I go to to would closing questions. this for sir. Thank time, like ahead, further turn there Ferraro back Please

Joe Ferraro

Yes. Thank you.

So in to company earnings quarterly recap, history. we reported our our best

delivered EBITDA. Americas including the enhanced in in metric, team team third fleet EBITDA control. These the quarter management were revenue cost and Our ever by generation highest stringent billion over diligent adjusted every business and $X a International the of quarter reporting highlighted efforts adjusted achieving

want all done. continuous to tireless employees the and for these their in Most helping we're not us acknowledge thank importantly, I efforts results, achieve and

track and to history, for in on thank company. company's be time adjusted We I interest to and your our continue the to want in deliver everyone highest full EBITDA year our

Operator

for today's This you, Thank us. conference. concludes you joining sir. Thank

You may now disconnect your lines.

Avis Budget (CAR) 1 Nov 222022 Q3 Earnings call transcript