CAR Q3 2021 Earnings

Call Details

• Call Title: Avis Budget Group Q3 2021 Earnings Call
• Date: November 2, 2021 at 12:30 PM UTC
• Management Team:
  • David Calabria (Treasurer and Senior Vice President of Corporate Finance)
  • Joe Ferraro (Chief Executive Officer)
  • Brian Choi (Chief Financial Officer)

Call Summary

Financial Performance

• Reported non-GAAP adjusted EBITDA exceeded $1.0B in Q3 2021 for the quarter alone.
• Generated over $1.7B in adjusted EBITDA in the first nine months of 2021 on a non-GAAP basis.
• Americas revenue increased by $1.3B year-over-year in Q3 2021.
• Americas adjusted EBITDA increased by nearly $750M year-over-year, implying an incremental margin of 58% on that revenue gain.
• International adjusted EBITDA improved from $6M in Q3 2020 to $128M in Q3 2021 on a $170M revenue gain, representing a 70% contribution margin on that incremental revenue.
• Gains on vehicle sales were approximately $150M in the quarter and the company reported a straight-line depreciation run-rate of roughly $240 per vehicle per month.

Guidance

• Company did not provide formal annual guidance in the press release but provided color on current trends.
• Current view expects over $2.0B in adjusted EBITDA for full year 2021 on a non-GAAP basis.
• Company stated it will forego providing formal annual guidance going forward to retain operational flexibility.
• Expect normal RPD seasonality so Q4 RPD will be lower than Q3 2021 but still higher year-over-year on an absolute basis.
• Americas rental days are expected to finish down low single digits in Q4 2021 versus Q3 2019 levels.
• Executive commentary emphasized that COVID transmission volatility could rapidly change near-term booking patterns and seasonality assumptions.