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January 2023
October 2022
October 2022
September 2022
July 2022
June 2022
June 2022
May 2022
May 2022
April 2022
• | Revenue growth of 26.6% to $3.12 billion |
• | Organic revenue growth for parts and services of 4.3% |
• | Growth of net income attributable to LKQ stockholders of 9.6% to $134 million; adjusted net income increased 26.9% |
• | Third quarter 2018 diluted EPS attributable to LKQ stockholders of $0.42; adjusted diluted EPS of $0.56 |
• | $500 million stock repurchase program announced |
• | 2018 annual earnings guidance updated |
Updated Guidance | Prior Guidance | |
Organic revenue growth for parts & services | 4.5% to 5.0% | 4.5% to 5.5% |
Net income from continuing operations attributable to LKQ stockholders | $565 million to $585 million | $602 million to $627 million |
Adjusted net income from continuing operations attributable to LKQ stockholders* | $690 million to $710 million | $710 million to $735 million |
Diluted EPS from continuing operations attributable to LKQ stockholders | $1.79 to $1.85 | $1.91 to $1.99 |
Adjusted diluted EPS from continuing operations attributable to LKQ stockholders* | $2.19 to $2.25 | $2.25 to $2.33 |
Cash flows from operations | $610 million to $660 million | $660 million to $710 million |
Capital expenditures | $240 million to $260 million | $255 million to $285 million |
• | changes in economic and political activity in the U.S. and other countries in which we are located or do business, including the U.K. withdrawal from the European Union, and the impact of these changes on our businesses, the demand for our products and our ability to obtain financing for operations; |
• | increasing competition in the automotive parts industry (including the potential competitive advantage to original equipment manufacturers (“OEMs”) with "connected car" technology); |
• | fluctuations in the pricing of new OEM replacement products; |
• | changes in the level of acceptance and promotion of alternative automotive parts by insurance companies and auto repairers; |
• | changes to our business relationships with insurance companies or changes by insurance companies to their business practices relating to the use of our products; |
• | our ability to identify sufficient acquisition candidates at reasonable prices to maintain our growth objectives; |
• | our ability to integrate, realize expected synergies, and successfully operate acquired companies and any companies acquired in the future, and the risks associated with these companies; |
• | the implementation of a border tax or tariff on imports and the negative impact on our business due to the amount of inventory we import, as well as the potential negative effects of countermeasures by other countries to which we export products; |
• | restrictions or prohibitions on selling certain aftermarket products to the extent OEMs seek and obtain more design patents than they have in the past and are successful in asserting infringement of these patents and defending their validity; |
• | variations in the number of vehicles manufactured and sold, vehicle accident rates, miles driven, and the age profile of vehicles in accidents; |
• | the increase of accident avoidance systems being installed in vehicles; |
• | the potential loss of sales of certain mechanical parts due to the rise of electric vehicle sales; |
• | fluctuations in the prices of fuel, scrap metal and other commodities; |
• | changes in laws or regulations affecting our business; |
• | higher costs and the resulting potential inability to service our customers to the extent that our suppliers decide to discontinue business relationships with us; |
• | price increases, interruptions or disruptions to the supply of vehicle parts from aftermarket suppliers and vehicles from salvage auctions; |
• | changes in the demand for our products and the supply of our inventory due to severity of weather and seasonality of weather patterns; |
• | the risks associated with operating in foreign jurisdictions, including foreign laws and economic and political instabilities; |
• | declines in the values of our assets; |
• | additional unionization efforts, new collective bargaining agreements, and work stoppages; |
• | our ability to develop and implement the operational and financial systems needed to manage our operations; |
• | interruptions, outages or breaches of our operational systems, security systems, or infrastructure as a result of attacks on, or malfunctions of, our systems; |
• | costs of complying with laws relating to the security of personal information and the potential significant penalties for failure to comply with such laws; |
• | product liability claims by the end users of our products or claims by other parties who we have promised to indemnify for product liability matters; |
• | costs associated with recalls of the products we sell; |
• | potential losses of our right to operate at key locations if we are not able to negotiate lease renewals; |
• | inaccuracies in the data relating to our industry published by independent sources upon which we rely; |
• | currency fluctuations in the U.S. dollar, pound sterling and euro versus other currencies; |
• | our ability to obtain financing on acceptable terms to finance our growth; |
• | our ability to satisfy our debt obligations and to operate within the limitations imposed by financing arrangements; and |
• | changes to applicable U.S. and foreign tax laws, changes to interpretations of tax laws, and changes in our mix of earnings among the jurisdictions in which we operate. |
Three Months Ended September 30, | ||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||
% of Revenue (1) | % of Revenue (1) | $ Change | % Change | |||||||||||||||||
Revenue | $ | 3,122,378 | 100.0 | % | $ | 2,465,800 | 100.0 | % | $ | 656,578 | 26.6 | % | ||||||||
Cost of goods sold | 1,925,180 | 61.7 | % | 1,508,924 | 61.2 | % | 416,256 | 27.6 | % | |||||||||||
Gross margin | 1,197,198 | 38.3 | % | 956,876 | 38.8 | % | 240,322 | 25.1 | % | |||||||||||
Selling, general and administrative expenses (2) | 879,150 | 28.2 | % | 695,978 | 28.2 | % | 183,172 | 26.3 | % | |||||||||||
Restructuring and acquisition related expenses | 6,614 | 0.2 | % | 4,922 | 0.2 | % | 1,692 | 34.4 | % | |||||||||||
Depreciation and amortization | 76,701 | 2.5 | % | 56,877 | 2.3 | % | 19,824 | 34.9 | % | |||||||||||
Operating income | 234,733 | 7.5 | % | 199,099 | 8.1 | % | 35,634 | 17.9 | % | |||||||||||
Other expense (income): | ||||||||||||||||||||
Interest expense, net | 40,860 | 1.3 | % | 25,222 | 1.0 | % | 15,638 | 62.0 | % | |||||||||||
Gain on bargain purchase | — | 0.0 | % | (913 | ) | 0.0 | % | 913 | 100.0 | % | ||||||||||
Other income, net | (6,959 | ) | (0.2 | %) | (3,107 | ) | (0.1 | %) | (3,852 | ) | n/m | |||||||||
Total other expense, net | 33,901 | 1.1 | % | 21,202 | 0.9 | % | 12,699 | 59.9 | % | |||||||||||
Income from continuing operations before provision for income taxes | 200,832 | 6.4 | % | 177,897 | 7.2 | % | 22,935 | 12.9 | % | |||||||||||
Provision for income taxes | 46,068 | 1.5 | % | 58,189 | 2.4 | % | (12,121 | ) | (20.8 | %) | ||||||||||
Equity in (losses) earnings of unconsolidated subsidiaries | (20,284 | ) | (0.6 | %) | 2,673 | 0.1 | % | (22,957 | ) | n/m | ||||||||||
Income from continuing operations | 134,480 | 4.3 | % | 122,381 | 5.0 | % | 12,099 | 9.9 | % | |||||||||||
Net loss from discontinued operations | — | 0.0 | % | — | 0.0 | % | — | n/m | ||||||||||||
Net income | 134,480 | 4.3 | % | 122,381 | 5.0 | % | 12,099 | 9.9 | % | |||||||||||
Less: net income attributable to noncontrolling interest | 378 | 0.0 | % | — | 0.0 | % | 378 | n/m | ||||||||||||
Net income attributable to LKQ stockholders | $ | 134,102 | 4.3 | % | $ | 122,381 | 5.0 | % | $ | 11,721 | 9.6 | % | ||||||||
Basic earnings per share: (3) | ||||||||||||||||||||
Income from continuing operations | $ | 0.42 | $ | 0.40 | $ | 0.02 | 5.0 | % | ||||||||||||
Net loss from discontinued operations | — | — | — | n/m | ||||||||||||||||
Net income | 0.42 | 0.40 | 0.02 | 5.0 | % | |||||||||||||||
Less: net income attributable to noncontrolling interest | 0.00 | — | 0.00 | n/m | ||||||||||||||||
Net income attributable to LKQ stockholders | $ | 0.42 | $ | 0.40 | $ | 0.02 | 5.0 | % | ||||||||||||
Diluted earnings per share: (3) | ||||||||||||||||||||
Income from continuing operations | $ | 0.42 | $ | 0.39 | $ | 0.03 | 7.7 | % | ||||||||||||
Net loss from discontinued operations | — | — | — | n/m | ||||||||||||||||
Net income | 0.42 | 0.39 | 0.03 | 7.7 | % | |||||||||||||||
Less: net income attributable to noncontrolling interest | 0.00 | — | 0.00 | n/m | ||||||||||||||||
Net income attributable to LKQ stockholders | $ | 0.42 | $ | 0.39 | $ | 0.03 | 7.7 | % | ||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||||||
Basic | 318,082 | 308,909 | 9,173 | 3.0 | % | |||||||||||||||
Diluted | 319,402 | 310,779 | 8,623 | 2.8 | % | |||||||||||||||
(1) The sum of the individual percentage of revenue components may not equal the total due to rounding. | ||||||||||||||||||||
(2) Selling, general and administrative expenses contain facility and warehouses expenses and distribution expenses that were previously shown separately. | ||||||||||||||||||||
(3) The sum of the individual earnings per share amounts may not equal the total due to rounding. |
Nine Months Ended September 30, | ||||||||||||||||||||
2018 | 2017 | |||||||||||||||||||
% of Revenue (1) | % of Revenue (1) | $ Change | % Change | |||||||||||||||||
Revenue | $ | 8,873,893 | 100.0 | % | $ | 7,267,054 | 100.0 | % | $ | 1,606,839 | 22.1 | % | ||||||||
Cost of goods sold | 5,460,845 | 61.5 | % | 4,415,076 | 60.8 | % | 1,045,769 | 23.7 | % | |||||||||||
Gross margin | 3,413,048 | 38.5 | % | 2,851,978 | 39.2 | % | 561,070 | 19.7 | % | |||||||||||
Selling, general and administrative expenses (2) | 2,472,085 | 27.9 | % | 2,003,065 | 27.6 | % | 469,020 | 23.4 | % | |||||||||||
Restructuring and acquisition related expenses | 26,546 | 0.3 | % | 10,371 | 0.1 | % | 16,175 | n/m | ||||||||||||
Depreciation and amortization | 196,322 | 2.2 | % | 159,178 | 2.2 | % | 37,144 | 23.3 | % | |||||||||||
Operating income | 718,095 | 8.1 | % | 679,364 | 9.3 | % | 38,731 | 5.7 | % | |||||||||||
Other expense (income): | ||||||||||||||||||||
Interest expense, net | 107,647 | 1.2 | % | 73,806 | 1.0 | % | 33,841 | 45.9 | % | |||||||||||
Gains on bargain purchases | (328 | ) | (0.0 | %) | (3,990 | ) | (0.1 | %) | 3,662 | 91.8 | % | |||||||||
Other income, net | (9,086 | ) | (0.1 | %) | (6,884 | ) | (0.1 | %) | (2,202 | ) | 32.0 | % | ||||||||
Total other expense, net | 98,233 | 1.1 | % | 62,932 | 0.9 | % | 35,301 | 56.1 | % | |||||||||||
Income from continuing operations before provision for income taxes | 619,862 | 7.0 | % | 616,432 | 8.5 | % | 3,430 | 0.6 | % | |||||||||||
Provision for income taxes | 156,427 | 1.8 | % | 206,206 | 2.8 | % | (49,779 | ) | (24.1 | %) | ||||||||||
Equity in (losses) earnings of unconsolidated subsidiaries | (18,326 | ) | (0.2 | %) | 3,878 | 0.1 | % | (22,204 | ) | n/m | ||||||||||
Income from continuing operations | 445,109 | 5.0 | % | 414,104 | 5.7 | % | 31,005 | 7.5 | % | |||||||||||
Net loss from discontinued operations | — | 0.0 | % | (4,531 | ) | (0.1 | %) | 4,531 | (100.0 | %) | ||||||||||
Net income | 445,109 | 5.0 | % | 409,573 | 5.6 | % | 35,536 | 8.7 | % | |||||||||||
Less: net income attributable to noncontrolling interest | 1,040 | 0.0 | % | — | 0.0 | % | 1,040 | n/m | ||||||||||||
Net income attributable to LKQ stockholders | $ | 444,069 | 5.0 | % | $ | 409,573 | 5.6 | % | $ | 34,496 | 8.4 | % | ||||||||
Basic earnings per share: (3) | ||||||||||||||||||||
Income from continuing operations | $ | 1.42 | $ | 1.34 | $ | 0.08 | 6.0 | % | ||||||||||||
Net loss from discontinued operations | — | (0.01 | ) | 0.01 | (100.0 | %) | ||||||||||||||
Net income | 1.42 | 1.33 | 0.09 | 6.8 | % | |||||||||||||||
Less: net income attributable to noncontrolling interest | 0.00 | — | 0.00 | n/m | ||||||||||||||||
Net income attributable to LKQ stockholders | $ | 1.42 | $ | 1.33 | $ | 0.09 | 6.8 | % | ||||||||||||
Diluted earnings per share: (3) | ||||||||||||||||||||
Income from continuing operations | $ | 1.41 | $ | 1.33 | $ | 0.08 | 6.0 | % | ||||||||||||
Net loss from discontinued operations | — | (0.01 | ) | 0.01 | (100.0 | %) | ||||||||||||||
Net income | 1.41 | 1.32 | 0.09 | 6.8 | % | |||||||||||||||
Less: net income attributable to noncontrolling interest | 0.00 | — | 0.00 | n/m | ||||||||||||||||
Net income attributable to LKQ stockholders | $ | 1.41 | $ | 1.32 | $ | 0.09 | 6.8 | % | ||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||||||
Basic | 313,417 | 308,451 | 4,966 | 1.6 | % | |||||||||||||||
Diluted | 314,951 | 310,495 | 4,456 | 1.4 | % | |||||||||||||||
(1) The sum of the individual percentage of revenue components may not equal the total due to rounding. | ||||||||||||||||||||
(2) Selling, general and administrative expenses contain facility and warehouses expenses and distribution expenses that were previously shown separately. | ||||||||||||||||||||
(3) The sum of the individual earnings per share amounts may not equal the total due to rounding. |
September 30, 2018 | December 31, 2017 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 341,346 | $ | 279,766 | |||
Receivables, net | 1,255,876 | 1,027,106 | |||||
Inventories | 2,794,894 | 2,380,783 | |||||
Prepaid expenses and other current assets | 200,944 | 134,479 | |||||
Total current assets | 4,593,060 | 3,822,134 | |||||
Property, plant and equipment, net | 1,201,003 | 913,089 | |||||
Intangible assets: | |||||||
Goodwill | 4,475,266 | 3,536,511 | |||||
Other intangibles, net | 953,372 | 743,769 | |||||
Equity method investments | 157,409 | 208,404 | |||||
Other assets | 205,226 | 142,965 | |||||
Total assets | $ | 11,585,336 | $ | 9,366,872 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 941,747 | $ | 788,613 | |||
Accrued expenses: | |||||||
Accrued payroll-related liabilities | 153,536 | 143,424 | |||||
Other accrued expenses | 358,212 | 218,600 | |||||
Refund liability | 106,732 | — | |||||
Other current liabilities | 57,088 | 45,727 | |||||
Current portion of long-term obligations | 118,365 | 126,360 | |||||
Total current liabilities | 1,735,680 | 1,322,724 | |||||
Long-term obligations, excluding current portion | 4,250,137 | 3,277,620 | |||||
Deferred income taxes | 325,537 | 252,359 | |||||
Other noncurrent liabilities | 376,566 | 307,516 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Common stock, $0.01 par value, 1,000,000,000 shares authorized, 318,197,309 and 309,126,386 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively | 3,182 | 3,091 | |||||
Additional paid-in capital | 1,409,242 | 1,141,451 | |||||
Retained earnings | 3,562,827 | 3,124,103 | |||||
Accumulated other comprehensive loss | (134,791 | ) | (70,476 | ) | |||
Total Company stockholders’ equity | 4,840,460 | 4,198,169 | |||||
Noncontrolling interest | 56,956 | 8,484 | |||||
Total stockholders’ equity | 4,897,416 | 4,206,653 | |||||
Total liabilities and stockholders’ equity | $ | 11,585,336 | $ | 9,366,872 |
Nine Months Ended | |||||||
September 30, | |||||||
2018 | 2017 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income | $ | 445,109 | $ | 409,573 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 210,977 | 166,508 | |||||
Impairment on Mekonomen equity method investment | 22,715 | — | |||||
Stock-based compensation expense | 17,544 | 17,582 | |||||
Loss on sale of business | — | 8,580 | |||||
Other | (7,187 | ) | (11,982 | ) | |||
Changes in operating assets and liabilities, net of effects from acquisitions and dispositions: | |||||||
Receivables, net | (70,797 | ) | (75,444 | ) | |||
Inventories | (71,058 | ) | (97,584 | ) | |||
Prepaid income taxes/income taxes payable | 7,262 | (928 | ) | ||||
Accounts payable | (71,997 | ) | 42,175 | ||||
Other operating assets and liabilities | 38,599 | (9,237 | ) | ||||
Net cash provided by operating activities | 521,167 | 449,243 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Purchases of property, plant and equipment | (171,763 | ) | (135,537 | ) | |||
Acquisitions, net of cash acquired | (1,206,067 | ) | (252,667 | ) | |||
Proceeds from disposals of business/investment | — | 301,297 | |||||
Investments in unconsolidated subsidiaries | (11,066 | ) | (7,114 | ) | |||
Payments of deferred purchase price on receivables securitization facility | 9,410 | — | |||||
Other investing activities, net | 7,970 | 9,864 | |||||
Net cash used in investing activities | (1,371,516 | ) | (84,157 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Proceeds from exercise of stock options | 3,772 | 6,465 | |||||
Taxes paid related to net share settlements of stock-based compensation awards | (4,768 | ) | (5,095 | ) | |||
Debt issuance costs | (16,938 | ) | — | ||||
Proceeds from issuance of Euro Notes (2026/28) | 1,232,100 | — | |||||
Borrowings under revolving credit facilities | 1,025,496 | 424,976 | |||||
Repayments under revolving credit facilities | (1,110,035 | ) | (770,884 | ) | |||
Repayments under term loans | (114,800 | ) | (27,884 | ) | |||
Borrowings under receivables securitization facility | — | 8,525 | |||||
Repayments under receivables securitization facility | — | (9,925 | ) | ||||
(Repayments) borrowings of other debt, net | (38,695 | ) | 24,522 | ||||
Payments of other obligations | — | (2,079 | ) | ||||
Other financing activities, net | 3,182 | 4,316 | |||||
Net cash provided by (used in) financing activities | 979,314 | (347,063 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | (67,385 | ) | 22,538 | ||||
Net increase in cash and cash equivalents | 61,580 | 40,561 | |||||
Cash and cash equivalents of continuing operations, beginning of period | 279,766 | 227,400 | |||||
Add: Cash and cash equivalents of discontinued operations, beginning of period | — | 7,116 | |||||
Cash and cash equivalents of continuing and discontinued operations, beginning of period | 279,766 | 234,516 | |||||
Cash and cash equivalents, end of period | $ | 341,346 | $ | 275,077 |
Three Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2018 | 2017 | $ Change | % Change | |||||||||||
(In thousands) | ||||||||||||||
Included in Unaudited Condensed Consolidated | ||||||||||||||
Statements of Income of LKQ Corporation | ||||||||||||||
North America | $ | 1,109,067 | $ | 1,051,470 | $ | 57,597 | 5.5 | % | ||||||
Europe | 1,464,049 | 952,765 | 511,284 | 53.7 | % | |||||||||
Specialty | 388,865 | 329,522 | 59,343 | 18.0 | % | |||||||||
Parts and services | 2,961,981 | 2,333,757 | 628,224 | 26.9 | % | |||||||||
Other | 160,397 | 132,043 | 28,354 | 21.5 | % | |||||||||
Total | $ | 3,122,378 | $ | 2,465,800 | $ | 656,578 | 26.6 | % |
Revenue Change Attributable to: | |||||||||||
Organic | Acquisition | Foreign Exchange | Total Change (1) | ||||||||
North America | 5.2 | % | 0.5 | % | (0.3 | %) | 5.5 | % | |||
Europe | 2.0 | % | 52.6 | % | (0.9 | %) | 53.7 | % | |||
Specialty | 8.0 | % | 10.5 | % | (0.5 | %) | 18.0 | % | |||
Parts and services | 4.3 | % | 23.2 | % | (0.6 | %) | 26.9 | % | |||
Other | 18.9 | % | 2.7 | % | (0.1 | %) | 21.5 | % | |||
Total | 5.1 | % | 22.1 | % | (0.6 | %) | 26.6 | % |
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2018 | 2017 | $ Change | % Change | |||||||||||
(In thousands) | ||||||||||||||
Included in Unaudited Condensed Consolidated | ||||||||||||||
Statements of Income of LKQ Corporation | ||||||||||||||
North America | $ | 3,447,074 | $ | 3,207,001 | $ | 240,073 | 7.5 | % | ||||||
Europe | 3,781,091 | 2,659,804 | 1,121,287 | 42.2 | % | |||||||||
Specialty | 1,151,172 | 1,005,776 | 145,396 | 14.5 | % | |||||||||
Parts and services | 8,379,337 | 6,872,581 | 1,506,756 | 21.9 | % | |||||||||
Other | 494,556 | 394,473 | 100,083 | 25.4 | % | |||||||||
Total | $ | 8,873,893 | $ | 7,267,054 | $ | 1,606,839 | 22.1 | % |
Revenue Change Attributable to: | |||||||||||
Organic | Acquisition | Foreign Exchange | Total Change (1) | ||||||||
North America | 6.4 | % | 1.0 | % | 0.1 | % | 7.5 | % | |||
Europe | 3.8 | % | 31.9 | % | 6.4 | % | 42.2 | % | |||
Specialty | 4.2 | % | 10.1 | % | 0.1 | % | 14.5 | % | |||
Parts and services | 5.1 | % | 14.3 | % | 2.5 | % | 21.9 | % | |||
Other | 23.9 | % | 1.5 | % | 0.1 | % | 25.4 | % | |||
Total | 6.1 | % | 13.6 | % | 2.4 | % | 22.1 | % |
Three Months Ended | Nine Months Ended | |||||||||||
September 30, 2018 | September 30, 2018 | |||||||||||
Consolidated | Europe | Consolidated | Europe | |||||||||
Parts & Services | ||||||||||||
Revenue growth as reported | 26.9 | % | 53.7 | % | 21.9 | % | 42.2 | % | ||||
Less: Currency impact | (0.6 | %) | (0.9 | %) | 2.5 | % | 6.4 | % | ||||
Revenue growth at constant currency | 27.5 | % | 54.6 | % | 19.4 | % | 35.8 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||
(In thousands) | % of Revenue | % of Revenue | % of Revenue | % of Revenue | |||||||||||||||||||
Revenue | |||||||||||||||||||||||
North America | $ | 1,262,799 | $ | 1,181,943 | $ | 3,927,808 | $ | 3,596,697 | |||||||||||||||
Europe | 1,470,856 | 954,522 | 3,795,439 | 2,665,170 | |||||||||||||||||||
Specialty | 390,061 | 330,594 | 1,154,726 | 1,008,998 | |||||||||||||||||||
Eliminations | (1,338 | ) | (1,259 | ) | (4,080 | ) | (3,811 | ) | |||||||||||||||
Total revenue | $ | 3,122,378 | $ | 2,465,800 | $ | 8,873,893 | $ | 7,267,054 | |||||||||||||||
Segment EBITDA | |||||||||||||||||||||||
North America | $ | 154,049 | 12.2 | % | $ | 152,627 | 12.9 | % | $ | 506,772 | 12.9 | % | $ | 502,494 | 14.0 | % | |||||||
Europe | 129,358 | 8.8 | % | 79,294 | 8.3 | % | 315,785 | 8.3 | % | 241,537 | 9.1 | % | |||||||||||
Specialty | 42,937 | 11.0 | % | 35,114 | 10.6 | % | 140,974 | 12.2 | % | 119,133 | 11.8 | % | |||||||||||
Total Segment EBITDA | $ | 326,344 | 10.5 | % | $ | 267,035 | 10.8 | % | $ | 963,531 | 10.9 | % | $ | 863,164 | 11.9 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
(In thousands) | |||||||||||||||
Net income | $ | 134,480 | $ | 122,381 | $ | 445,109 | $ | 409,573 | |||||||
Less: net income attributable to noncontrolling interest | 378 | — | 1,040 | — | |||||||||||
Net income attributable to LKQ stockholders | 134,102 | 122,381 | 444,069 | 409,573 | |||||||||||
Subtract: | |||||||||||||||
Net loss from discontinued operations | — | — | — | (4,531 | ) | ||||||||||
Net income from continuing operations attributable to LKQ stockholders | 134,102 | 122,381 | 444,069 | 414,104 | |||||||||||
Add: | |||||||||||||||
Depreciation and amortization | 76,701 | 56,877 | 196,322 | 159,178 | |||||||||||
Depreciation and amortization - cost of goods sold | 4,772 | 3,025 | 14,655 | 7,330 | |||||||||||
Interest expense, net | 40,860 | 25,222 | 107,647 | 73,806 | |||||||||||
Provision for income taxes | 46,068 | 58,189 | 156,427 | 206,206 | |||||||||||
Earnings before interest, taxes, depreciation and amortization (EBITDA) | 302,503 | 265,694 | 919,120 | 860,624 | |||||||||||
Subtract: | |||||||||||||||
Equity in (losses) earnings of unconsolidated subsidiaries | (20,284 | ) | 2,673 | (18,326 | ) | 3,878 | |||||||||
Fair value gain on Mekonomen derivative instrument | 2,509 | — | 2,509 | — | |||||||||||
Gains on bargain purchases | — | 913 | 328 | 3,990 | |||||||||||
Add: | |||||||||||||||
Restructuring and acquisition related expenses | 6,614 | 4,922 | 26,546 | 10,371 | |||||||||||
Inventory step-up adjustment - acquisition related | — | — | 403 | — | |||||||||||
Impairment of net assets held for sale | — | — | 2,438 | — | |||||||||||
Change in fair value of contingent consideration liabilities | (548 | ) | 5 | (465 | ) | 37 | |||||||||
Segment EBITDA | $ | 326,344 | $ | 267,035 | $ | 963,531 | $ | 863,164 | |||||||
EBITDA as a percentage of revenue | 9.7 | % | 10.8 | % | 10.4 | % | 11.8 | % | |||||||
Segment EBITDA as a percentage of revenue | 10.5 | % | 10.8 | % | 10.9 | % | 11.9 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
(In thousands, except per share data) | |||||||||||||||
Net income | $ | 134,480 | $ | 122,381 | $ | 445,109 | $ | 409,573 | |||||||
Less: net income attributable to noncontrolling interest | 378 | — | 1,040 | — | |||||||||||
Net income attributable to LKQ stockholders | 134,102 | 122,381 | 444,069 | 409,573 | |||||||||||
Subtract: | |||||||||||||||
Net loss from discontinued operations | — | — | — | (4,531 | ) | ||||||||||
Net income from continuing operations attributable to LKQ stockholders | 134,102 | 122,381 | 444,069 | 414,104 | |||||||||||
Adjustments - continuing operations attributable to LKQ stockholders: | |||||||||||||||
Amortization of acquired intangibles | 38,994 | 25,084 | 88,924 | 71,163 | |||||||||||
Restructuring and acquisition related expenses | 6,614 | 4,922 | 26,546 | 10,371 | |||||||||||
Inventory step-up adjustment - acquisition related | — | — | 403 | — | |||||||||||
Change in fair value of contingent consideration liabilities | (548 | ) | 5 | (465 | ) | 37 | |||||||||
Gains on bargain purchases | — | (913 | ) | (328 | ) | (3,990 | ) | ||||||||
Impairment of net assets held for sale | — | — | 2,438 | — | |||||||||||
Impairment on Mekonomen equity method investment | 22,715 | — | 22,715 | — | |||||||||||
Fair value gain on Mekonomen derivative instrument | (2,509 | ) | — | (2,509 | ) | — | |||||||||
U.S. tax law change 2017 | (9,581 | ) | — | (9,581 | ) | — | |||||||||
Excess tax benefit from stock-based payments | (793 | ) | (1,513 | ) | (3,985 | ) | (7,058 | ) | |||||||
Tax effect of adjustments | (11,701 | ) | (10,221 | ) | (28,805 | ) | (28,333 | ) | |||||||
Adjusted net income from continuing operations attributable to LKQ stockholders | $ | 177,293 | $ | 139,745 | $ | 539,422 | $ | 456,294 | |||||||
Weighted average diluted common shares outstanding | 319,402 | 310,779 | 314,951 | 310,495 | |||||||||||
Diluted earnings per share from continuing operations attributable to LKQ stockholders: | |||||||||||||||
Reported | $ | 0.42 | $ | 0.39 | $ | 1.41 | $ | 1.33 | |||||||
Adjusted | $ | 0.56 | $ | 0.45 | $ | 1.71 | $ | 1.47 |
Forecasted | |||||||
Fiscal Year 2018 | |||||||
Minimum Guidance | Maximum Guidance | ||||||
(In millions, except per share data) | |||||||
Net income from continuing operations attributable to LKQ stockholders | $ | 565 | $ | 585 | |||
Adjustments: | |||||||
Amortization of acquired intangibles | 130 | 130 | |||||
Restructuring and acquisition related expenses | 27 | 27 | |||||
Impairment on Mekonomen equity method investment | 23 | 23 | |||||
U.S. tax law change 2017 | (10 | ) | (10 | ) | |||
Excess tax benefit from stock-based payments | (4 | ) | (4 | ) | |||
Other | (0 | ) | (0 | ) | |||
Tax effect of adjustments | (40 | ) | (40 | ) | |||
Adjusted net income from continuing operations attributable to LKQ stockholders | $ | 690 | $ | 710 | |||
Weighted average diluted common shares outstanding | 316 | 316 | |||||
Diluted earnings per share from continuing operations attributable to LKQ stockholders: | |||||||
U.S. GAAP | $ | 1.79 | $ | 1.85 | |||
Non-GAAP (Adjusted) | $ | 2.19 | $ | 2.25 |
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Ticker: LKQEvents:
CIK: 1065696
Form Type: 8-K Corporate News
Accession Number: 0001065696-18-000068
Submitted to the SEC: Thu Oct 25 2018 6:55:36 AM EST
Accepted by the SEC: Thu Oct 25 2018
Period: Thursday, October 25, 2018
Industry: Wholesale Motor Vehicles And Motor Vehicle Parts And Supplies