AVIS BUDGET GROUP INC

Previous wording

We operate three of the most globally recognized brands in mobility solutions, Avis, Budget and Zipcar, together with several other brands well recognized in their respective markets. We are a leading vehicle rental operator in North America, Europe, Australasia and certain other regions we serve, with an average rental fleet of approximately 667,000 vehicles in first quarter 2024. We also license the use of our trademarks to licensees in the areas in which we do not operate directly. We and our licensees operate our brands in approximately 180 countries throughout the world.

Current wording

We operate three of the most globally recognized brands in mobility solutions, Avis, Budget and Zipcar, together with several other brands well recognized in their respective markets. We are a leading vehicle rental operator in North America, Europe, Australasia and certain other regions we serve, with an average rental fleet of approximately 705,000 vehicles in second quarter 2024. We also license the use of our trademarks to licensees in the areas in which we do not operate directly. We and our licensees operate our brands in approximately 180 countries throughout the world.

Previous wording

We categorize our operations into two reportable business segments: Americas, consisting primarily of our vehicle rental operations in North America, South America, Central America and the Caribbean, car sharing operations in certain of these markets, and licensees in certain areas in which we do not operate directly; and International, consisting primarily of our vehicle rental operations in Europe, the Middle East, Africa, Asia and Australasia, car sharing operations in certain of these markets, and licensees in certain areas in which we do not operate directly.

Current wording

We categorize our operations into two reportable business segments: Americas, consisting primarily of (i) vehicle rental operations in North America, South America, Central America and the Caribbean, (ii) car sharing operations in certain of these markets, and (iii) licensees in certain areas in which we do not operate directly; and International, consisting primarily of (i) vehicle rental operations in Europe, the Middle East, Africa, Asia and Australasia, (ii) car sharing operations in certain of these markets, and (iii) licensees in certain areas in which we do not operate directly.

Previous wording

Our strategy continues to primarily focus on customer experience and costs to strengthen our Company, maximize profitability, and deliver stakeholder value. During the three months ended March 31, 2024, we generated revenues of $2.6 billion, net loss of $113 million and Adjusted EBITDA of $12 million. These results were driven primarily by increased volume, offset by decreased revenue per day, increased fleet costs, and sustained inflationary pressures on costs.

Current wording

Our strategy continues to primarily focus on customer experience and costs to strengthen our Company, maximize profitability, and deliver stakeholder value. During the three months ended June 30, 2024, we generated revenues of $3.0 billion, net income of $15 million and Adjusted EBITDA of $214 million. These results were driven primarily by increased volume, offset by decreased revenue per day, and increased fleet and interest costs.

Previous wording

We continue to be susceptible to a number of industry-specific and global macroeconomic factors that may cause our actual results of operations to differ from our historical results of operations or current expectations. The factors and trends that we currently believe are or will be most impactful to our results of operations and financial condition include the following: interest rates, inflationary impact on items such as commodity prices and wages, supply of new vehicles, used car values, and an economic downturn that may impact travel demand, all of which may be exacerbated by the ongoing military conflicts in the Middle East and Eastern Europe. We continue to monitor the potential favorable or unfavorable impacts of these and other factors on our business, operations, financial condition, and future results of operations.

Current wording

We continue to be susceptible to a number of industry-specific and global macroeconomic factors that may cause our actual results of operations to differ from our historical results of operations or current expectations. The factors and trends that we currently believe are or will be most impactful to our results of operations and financial condition include the following: interest rates, inflationary impact on items such as commodity prices and wages, cost of new vehicles, used car values, and an economic downturn that may impact travel demand, all of which may be exacerbated by the ongoing military conflicts in the Middle East and Eastern Europe. We continue to monitor the potential favorable or unfavorable impacts of these and other factors on our business, operations, financial condition, and future results of operations.

Previous wording

•Our net loss was $114 million, representing a decrease of $426 million year-over-year, primarily due to increased fleet costs and sustained inflationary pressures on costs.

Current wording

•Our net loss was $100 million, representing a decrease in our net income of $847 million year-over-year, primarily due to increased fleet and interest costs.

Previous wording

•Our Adjusted EBITDA was $12 million, representing a decrease of $523 million year-over-year.

Current wording

•Our Adjusted EBITDA was $226 million, representing a decrease of $1.0 billion year-over-year.

Previous wording

Our consolidated condensed results of operations comprised the following:

Current wording

Our consolidated condensed results of operations comprised of the following:

Previous wording

Revenues during the three months ended March 31, 2024 were consistent with the similar period in 2023, primarily due to a 5% increase in volume, offset by a 5% decrease in revenue per day, excluding exchange rate effects. Total expenses increased 25% during the three months ended March 31, 2024, compared to the similar period in 2023, primarily due to increased fleet costs and the impact of inflation. Our effective tax rates were a benefit of 20.4% and a provision of 21.4% for the three months ended March 31, 2024 and 2023, respectively. As a result of these items, our net income decreased by $426 million compared to the similar period in 2023. For the three months ended March 31, 2024 and 2023, we reported earnings (loss) per diluted share of $(3.21) and $7.72, respectively.

Current wording

Revenues decreased $75 million, or 2%, during the three months ended June 30, 2024 compared to the similar period in 2023, primarily due to a 4% decrease in revenue per day, excluding exchange rate effects, and a $10 million negative impact from currency exchange rate movements, partially offset by a 2% increase in volume. Total expenses increased 20% during the three months ended June 30, 2024 compared to the similar period in 2023, primarily due to increased fleet and interest costs. Our effective tax rates were a provision of 44.4% and 27.1% for the three months ended June 30, 2024 and 2023, respectively. As a result of these items, our net income decreased by $421 million compared to the similar period in 2023. For the three months ended June 30, 2024 and 2023, we reported earnings per diluted share of $0.41 and $11.01, respectively.

Previous wording

Adjusted EBITDA decreased during the three months ended March 31, 2024 compared to the similar period in 2023, primarily due to higher per-unit fleet costs and inflationary pressures.

Current wording

Adjusted EBITDA decreased during the three months ended June 30, 2024 compared to the similar period in 2023, primarily due to higher per-unit fleet and interest costs.

Previous wording

Revenues decreased during thethree months ended March 31, 2024 compared to the similar period in 2023, primarily due toa 6% decrease in revenue per day, partially offset by a 5% increase in volume.

Current wording

Revenues decreased during the three months ended June 30, 2024, compared to the similar period in 2023, primarily due to a 5% decrease in revenue per day, excluding exchange rate effects, and a $8 million negative impact from currency exchange rate movements, offset by a 5% increase in volume.

Previous wording

Revenues increased during thethree months ended March 31, 2024 compared to the similar period in 2023, primarily due to a 4% increase in volume, partially offset by a 1% decrease in revenue per day, excluding exchange rate effects.

Current wording

Revenues increased during thesix months ended June 30, 2024 compared to the similar period in 2023, primarily due to a 5% increase in volume, partially offset by a 3% decrease in revenue per day, excluding exchange rate effects, and a $8 million negative impact from currency exchange rate movements.

Previous wording

Operating expenses decreased to 51.9% of revenue during the three months ended March 31, 2024 compared to 52.6% during the similar period in 2023, primarily due to an increase in volume, partially offset by a decrease in revenue per day, excluding exchange rate effects. Vehicle depreciation and lease charges increased to 26.7% of revenue during the three months ended March 31, 2024 compared to 16.7% during the similar period in 2023, primarily due to increased per-unit fleet costs, excluding exchange rate effects, which was driven by increased fleet levels, increased depreciation rates, and a decrease in the gain on sale of vehicles. Selling, general and administrative costs were approximately 17.7% of revenue during the three months ended March 31, 2024, consistent with the similar period in 2023, primarily due to increased marketing costs and commissions, offset by a decrease in other selling, general and administrative costs. Vehicle interest costs increased to 6.5% of revenue during the three months ended March 31, 2024 compared to 3.8% during the similar period in 2023, primarily due to rising interest rates and additional funding for vehicles.

Current wording

Operating expenses increased to 49.8% of revenue during the six months ended June 30, 2024 compared to 48.5% during the similar period in 2023, primarily due to an increase in volume. Vehicle depreciation and lease charges increased to 25.9% of revenue during the six months ended June 30, 2024 compared to 17.0% during the similar period in 2023, primarily due to increased per-unit fleet costs, excluding exchange rate effects, which was driven by increased fleet levels, increased depreciation rates, and a decrease in the gain on sale of vehicles. Selling, general and administrative costs were approximately 16.7% of revenue during the six months ended June 30, 2024 compared to 16.6% during the similar period in 2023. Vehicle interest costs increased to 5.9% of revenue during the six months ended June 30, 2024 compared to 3.8% during the similar period in 2023, primarily due to rising interest rates.

Previous wording

The increases in assets and liabilities under vehicle programs are primarily due to the increase in the size and cost of our vehicle fleet.

Current wording

The increases in assets and liabilities under vehicle programs are primarily due to the increase in the cost of our vehicle fleet.

Previous wording

Our Board of Directors has authorized the repurchase of up to approximately$8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023. Our stock repurchases may occur through open market purchases, privately negotiated transactions or trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements, restricted payment capacity under our debt instruments and other factors. The repurchase program may be suspended, modified or discontinued at any time without prior notice. The repurchase program has no set expiration or termination date. During the three months ended March 31, 2024, nocommon stock repurchases were made under the program. As of March 31, 2024, approximately $802 million of authorization remained available to repurchase common stock under the program.

Current wording

Our Board of Directors has authorized the repurchase of up to approximately$8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023. Our stock repurchases may occur through open market purchases, privately negotiated transactions or trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements, restricted payment capacity under our debt instruments and other factors. The Stock Repurchase Program may be suspended, modified or discontinued at any time without prior notice. The Stock Repurchase Program has no set expiration or termination date. During the six months ended June 30, 2024, nocommon stock repurchases were made under the Stock Repurchase Program. As of June 30, 2024, approximately $802 million of authorization remained available to repurchase common stock under the Stock Repurchase Program.

Previous wording

The decrease in cash provided by operating activities during the three months ended March 31, 2024 compared with the similar period in 2023 is primarily due to the decrease in our net income.

Current wording

The decrease in cash provided by operating activities during the six months ended June 30, 2024 compared with the similar period in 2023 is primarily due to the decrease in our net income.

Previous wording

The decrease in cash used in investing activities during the three months ended March 31, 2024 compared with the similar period in 2023 is primarily due to the increase in proceeds received on disposition of vehicles.

Current wording

The decrease in cash used in investing activities during the six months ended June 30, 2024 compared with the similar period in 2023 is primarily due to the decrease in investment in vehicles, partially offset by proceeds received on disposition of vehicles.

Previous wording

The increase in cash provided by financing activities during the three months ended March 31, 2024 compared with the similar period in 2023 is primarily due to the increase in our net corporate borrowings, offset by the decrease in our net borrowings under vehicle programs.

Current wording

The decrease in cash provided by financing activities during the six months ended June 30, 2024 compared with the similar period in 2023 is primarily due to the decrease in our net borrowings under vehicle programs, offset by the increase in our net corporate borrowings.

Previous wording

At March 31, 2024, we had approximately $24.6 billion of indebtedness, including corporate indebtedness of approximately $5.4 billion and debt under vehicle programs of approximately $19.2 billion. For information regarding our debt and borrowing arrangements, see Notes 1, 10 and 11 to our Consolidated Condensed Financial Statements.

Current wording

At June 30, 2024, we had approximately $24.8 billion of indebtedness, including corporate indebtedness of approximately $5.3 billion and debt under vehicle programs of approximately $19.5 billion. For information regarding our debt and borrowing arrangements, see Notes 1, 10 and 11 to our Consolidated Condensed Financial Statements.

Previous wording

As of March 31, 2024, we had $522 million of available cash and cash equivalents and access to available borrowings under our revolving credit facility of approximately $200 million, providing us with access to an approximate $722 million of total liquidity.

Current wording

As of June 30, 2024, we had $511 million of available cash and cash equivalents and access to available borrowings under our revolving credit facility of approximately $11 million, providing us with access to an approximate $522 million of total liquidity.

Previous wording

Our future contractual obligations have not changed significantly from the amounts reported within our 2023 Form 10-K with the exception of our commitment to purchase vehicles, which decreased by approximately $2.7 billion from December 31, 2023, to approximately $4.1 billion as of March 31, 2024 due to existing fleet levels. Changes to our obligations related to corporate indebtedness and debt under vehicle programs are presented above within the section titled “Liquidity and Capital Resources—Debt and Financing Arrangements” and also within Notes 10 and 11 to our Consolidated Condensed Financial Statements.

Current wording

Our future contractual obligations have not changed significantly from the amounts reported within our 2023 Form 10-K with the exception of our commitment to purchase vehicles, which decreased by approximately $5.4 billion from December 31, 2023, to approximately $1.4 billion as of June 30, 2024 due to existing fleet levels. Changes to our obligations related to corporate indebtedness and debt under vehicle programs are presented above within the section titled “Liquidity and Capital Resources—Debt and Financing Arrangements” and also within Notes 10 and 11 to our Consolidated Condensed Financial Statements.