Condensed Consolidated Financial Information

12 Months Ended

Dec. 31, 2019

Condensed Financial Information Disclosure [Abstract]

CONDENSED CONSOLIDATING FINANCIAL INFORMATION

The following tables include condensed consolidating financial information as of December 31, 2019 and 2018, and for each of the years in the three-year period ended December 31, 2019, for Group 1 Automotive, Inc.’s (as issuer of the 5.00% Notes), guarantor subsidiaries and non-guarantor subsidiaries (representing foreign entities). The condensed consolidating financial information includes certain allocations of balance sheet, statement of operations and cash flows items that are not necessarily indicative of the financial position, results of operations or cash flows of these entities had they operated on a stand-alone basis. In accordance with Rule 3-10 of Regulation S-X, condensed consolidated financial statements of non-guarantors are not required. The Company has no assets or operations independent of its subsidiaries. Obligations under the 5.00% Notes are fully and unconditionally and jointly and severally guaranteed on a senior unsecured basis by the Company’s current 100%-owned domestic subsidiaries and certain of the Company’s future domestic subsidiaries, with the exception of the Company’s “minor” subsidiaries (as defined by Rule 3-10 of Regulation S-X). There are no significant restrictions on the ability of the Company or subsidiary guarantors for the Company to obtain funds from its subsidiary guarantors by dividend or loan. None of the subsidiary guarantors’ assets represent restricted assets pursuant to SEC Rule 4-08(e)(3) of Regulation S-X.

CONDENSED CONSOLIDATED BALANCE SHEETS

As of December 31, 2019

(In millions)



	Group 1 Automotive, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Elimination			Total Company
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	5.6		$	18.2	$	—		$	23.8
Contracts-in-transit and vehicle receivables, net	—		211.0			42.8		—			253.8
Accounts and notes receivable, net	0.4		177.0			47.7		—			225.1
Intercompany accounts receivable	72.3		99.0			1.0		(172.3		)	—
Inventories, net	—		1,498.5			403.2		—			1,901.7
Prepaid and other current assets	2.0		31.0			78.9		—			111.9
TOTAL CURRENT ASSETS	74.7		2,022.1			591.8		(172.3		)	2,516.3
Property and equipment, net	—		1,251.4			295.7		—			1,547.1
Operating lease assets	—		114.8			105.3		—			220.1
Goodwill	—		902.3			106.0		—			1,008.3
Intangible franchise rights	—		223.0			30.5		—			253.5
Investment in subsidiaries	3,393.2		—			—		(3,393.2		)	—
Other long-term assets	—		14.9			9.9		—			24.8
TOTAL ASSETS	$	3,467.9	$	4,528.5		$	1,139.2	$	(3,565.5	)	$	5,570.2

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Floorplan notes payable — credit facility and other, net of offset account of $106.8	$	—	$	1,099.1		$	45.3	$	—		$	1,144.4
Floorplan notes payable — manufacturer affiliates, net of offset account of $4.1	—		318.4			141.5		—			459.9
Current maturities of long-term debt	—		27.0			32.1		—			59.1
Current operating lease liabilities	—		17.4			7.2		—			24.6
Accounts payable	—		235.4			292.1		—			527.5
Intercompany accounts payable	1,296.8		—			100.0		(1,396.8		)	—
Accrued expenses and other current liabilities	—		177.2			29.5		—			206.7
TOTAL CURRENT LIABILITIES	1,296.8		1,874.5			647.7		(1,396.8		)	2,422.3
Long-term debt, net of current maturities	915.3		379.0			137.8		—			1,432.1
Operating lease liabilities, net of current portion	—		104.9			105.8		—			210.7
Deferred income taxes and other long-term liabilities	—		245.6			3.7		—			249.3
STOCKHOLDERS’ EQUITY:
Group 1 stockholders’ equity	1,255.7		3,148.9			244.3		(3,393.2		)	1,255.7
Intercompany note receivable	—		(1,224.5		)	—		1,224.5			—
TOTAL STOCKHOLDERS’ EQUITY	1,255.7		1,924.4			244.3		(2,168.7		)	1,255.7
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	3,467.9	$	4,528.5		$	1,139.2	$	(3,565.5	)	$	5,570.2

CONDENSED CONSOLIDATED BALANCE SHEETS

As of December 31, 2018

(In millions)



	Group 1 Automotive, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Elimination			Total Company
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	4.6		$	11.3	$	—		$	15.9
Contracts-in-transit and vehicle receivables, net	—		232.1			33.6		—			265.7
Accounts and notes receivable, net	—		153.9			40.1		—			194.0
Intercompany accounts receivable	31.9		21.6			—		(53.5		)	—
Inventories, net	—		1,468.5			375.6		—			1,844.1
Prepaid expenses and other current assets	1.0		32.1			49.6		—			82.7
TOTAL CURRENT ASSETS	32.9		1,912.8			510.2		(53.5		)	2,402.4
Property and equipment, net	—		1,124.5			223.3		—			1,347.8
Goodwill	—		861.6			102.3		—			963.9
Intangible franchise rights	—		224.4			35.2		—			259.6
Investment in subsidiaries	3,100.9		—			—		(3,100.9		)	—
Other long-term assets	—		16.2			11.2		—			27.3
TOTAL ASSETS	$	3,133.8	$	4,139.5		$	882.2	$	(3,154.4	)	$	5,001.1

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Floorplan notes payable — credit facility and other, net of offset account of $33.6	$	—	$	1,217.8		$	41.1	$	—		$	1,258.8
Floorplan notes payable — manufacturer affiliates, net of offset account of $0.1	—		276.7			141.1		—			417.8
Current maturities of long-term debt	—		73.9			19.1		—			93.0
Accounts payable	—		201.0			218.4		—			419.4
Intercompany accounts payable	1,165.0		—			53.4		(1,218.4		)	—
Accrued expenses and other current liabilities	—		165.0			32.6		—			197.6
TOTAL CURRENT LIABILITIES	1,165.0		1,934.4			505.7		(1,218.4		)	2,386.6
Long-term debt, net of current maturities	872.3		294.3			114.8		—			1,281.5
Deferred income taxes and other long-term liabilities	0.8		224.7			11.8		—			237.3
STOCKHOLDERS’ EQUITY:
Group 1 stockholders’ equity	1,095.7		2,851.0			249.9		(3,100.9		)	1,095.7
Intercompany note receivable	—		(1,164.9		)	—		1,164.9			—
TOTAL STOCKHOLDERS’ EQUITY	1,095.7		1,686.1			249.9		(1,936.0		)	1,095.7
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	3,133.8	$	4,139.5		$	882.2	$	(3,154.4	)	$	5,001.1

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Year Ended December 31, 2019

(In millions)



	Group 1 Automotive, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elimination			Total Company
Revenues	$	—		$	9,184.3		$	2,859.5		$	—		$	12,043.8
Cost of sales	—			7,689.5			2,538.3			—			10,227.8
Gross profit	—			1,494.8			321.2			—			1,816.0
Selling, general and administrative expenses	4.1			1,066.6			287.7			—			1,358.4
Depreciation and amortization expense	—			55.4			16.2			—			71.6
Asset impairments	—			14.6			7.6			—			22.2
Income (loss) from operations	(4.1		)	358.2			9.7			—			363.7
Interest expense:
Floorplan interest expense	—			53.8			7.8			—			61.6
Other interest expense, net	—			67.5			7.4			—			74.9
Income (loss) before income taxes and equity in earnings of subsidiaries	(4.1		)	236.9			(5.5		)	—			227.3
(Benefit) provision for income taxes	(1.0		)	56.2			(1.9		)	—			53.3
Equity in earnings (loss) of subsidiaries	177.1			—			—			(177.1		)	—
Net income (loss)	$	174.0		$	180.7		$	(3.6	)	$	(177.1	)	$	174.0
Other comprehensive income (loss)	(9.2		)	(13.0		)	3.8			9.2			(9.2		)
Comprehensive income (loss)	$	164.8		$	167.7		$	0.2		$	(167.9	)	$	164.8

Year Ended December 31, 2018

(In millions)



	Group 1 Automotive, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elimination			Total Company
Revenues	$	—		$	8,723.3		$	2,878.1		$	—		$	11,601.4
Cost of sales	—			7,332.0			2,544.3			—			9,876.3
Gross profit	—			1,391.3			333.8			—			1,725.1
Selling, general and administrative expenses	3.4			971.9			297.7			—			1,273.1
Depreciation and amortization expense	—			52.9			14.2			—			67.1
Asset impairments	—			43.4			0.5			—			43.9
Income (loss) from operations	(3.4		)	323.1			21.4			—			341.1
Interest expense:
Floorplan interest expense	—			(52.8		)	(7.1		)	—			(59.9		)
Other interest expense, net	—			(68.1		)	(7.7		)	—			(75.8		)
Income (loss) before income taxes and equity in earnings of subsidiaries	(3.4		)	202.2			6.5			—			205.4
(Benefit) provision for income taxes	(0.8		)	44.5			3.9			—			47.6
Equity in earnings (loss) of subsidiaries	160.4			—			—			(160.4		)	—
Net income (loss)	$	157.8		$	157.7		$	2.6		$	(160.4	)	$	157.8
Other comprehensive income (loss)	—			9.8			(24.2		)	—			(14.4		)
Comprehensive income (loss)	$	157.8		$	167.5		$	(21.5	)	$	(160.4	)	$	143.4

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Year Ended December 31, 2017

(In millions)



	Group 1 Automotive, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Elimination			Total Company
Revenues	$	—		$	8,680.6		$	2,443.2		$	—		$	11,123.7
Cost of sales	—			7,315.3			2,163.0			—			9,478.2
Gross profit	—			1,365.3			280.2			—			1,645.5
Selling, general and administrative expenses	3.4			974.4			248.4			—			1,226.2
Depreciation and amortization expense	—			48.3			9.7			—			57.9
Asset impairments	—			12.8			6.7			—			19.5
Income (loss) from operations	(3.4		)	329.9			15.4			—			341.9
Interest expense:
Floorplan interest expense	—			(47.2		)	(5.2		)	—			(52.4		)
Other interest expense, net	—			(66.5		)	(4.0		)	—			(70.5		)
Income (loss) before income taxes and equity in earnings of subsidiaries	(3.4		)	216.1			6.2			—			219.0
(Benefit) provision for income taxes	(1.3		)	6.9			(0.1		)	—			5.6
Equity in earnings (loss) of subsidiaries	215.6			—			—			(215.6		)	—
Net income (loss)	$	213.4		$	209.2		$	6.4		$	(215.6	)	$	213.4
Other comprehensive income (loss)	—			8.7			15.1			—			23.7
Comprehensive income (loss)	$	213.4		$	217.9		$	21.4		$	(215.6	)	$	237.2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended December 31, 2019

(In millions)



	Group 1 Automotive, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Total Company
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	174.0		$	169.1		$	27.8		$	370.9
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for acquisitions, net of cash received	—			(113.9		)	(29.3		)	(143.2		)
Proceeds from disposition of franchises, property and equipment	—			37.2			6.2			43.4
Purchases of property and equipment	—			(133.7		)	(58.1		)	(191.8		)
Net cash used in (provided by) investing activities	—			(210.4		)	(81.2		)	(291.6		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facility — floorplan line and other	—			7,248.9			55.7			7,304.6
Repayments on credit facility — floorplan line and other	—			(7,370.1		)	(53.1		)	(7,423.2		)
Borrowings on credit facility — acquisition line	319.0			—			—			319.0
Repayments on credit facility — acquisition line	(281.4		)	—			—			(281.4		)
Debt issue costs	—			(3.5		)	(1.9		)	(5.4		)
Borrowings on other debt	—			55.7			121.7			177.4
Principal payments on other debt	—			(53.8		)	(112.9		)	(166.7		)
Borrowings on debt related to real estate	—			152.4			21.1			173.5
Principal payments on debt related to real estate	—			(138.7		)	(8.6		)	(147.3		)
Proceeds from employee stock purchase plan	8.6			—			—			8.6
Payment of tax withholding for stock-based awards	(4.4		)	—			—			(4.4		)
Repurchases of common stock, amounts based on settlement date	(1.4		)	—			—			(1.4		)
Dividends paid	(20.3		)	—			—			(20.3		)
Borrowings (repayments) with subsidiaries	113.5			(155.9		)	42.5			—
Investment in subsidiaries	(307.5		)	307.3			0.2			—
Net cash provided by (used in) financing activities	(174.0		)	42.3			64.7			(67.0		)
Effect of exchange rate changes on cash	—			—			(2.9		)	(2.9		)
Net increase (decrease) in cash, cash equivalents and restricted cash	—			1.0			8.4			9.3
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period	—			4.6			14.1			18.7
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of period	$	—		$	5.6		$	22.5		$	28.1

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended December 31, 2018

(In millions)



	Group 1 Automotive, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Total Company
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	157.8		$	98.9		$	13.3		$	270.0
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for acquisitions, net of cash received	—			(91.9		)	(43.5		)	(135.3		)
Proceeds from disposition of franchises, property and equipment	—			101.5			6.4			107.9
Purchases of property and equipment	—			(97.2		)	(43.8		)	(141.0		)
Other	0.5			—			—			0.5
Net cash provided by (used in) investing activities	0.5			(87.7		)	(80.8		)	(168.0		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facility — floorplan line and other	—			6,858.5			95.8			6,954.3
Repayments on credit facility — floorplan line and other	—			(6,797.1		)	(72.9		)	(6,870.1		)
Borrowings on credit facility — acquisition line	165.3			—			—			165.3
Repayments on credit facility — acquisition line	(158.5		)	—			—			(158.5		)
Borrowings on other debt	—			95.8			60.2			156.0
Principal payments on other debt	(24.7		)	(48.9		)	(45.1		)	(118.8		)
Borrowings on debt related to real estate	—			42.7			12.1			54.7
Principal payments on debt related to real estate	—			(77.8		)	(13.7		)	(91.5		)
Proceeds from employee stock purchase plan	7.6			—			—			7.6
Payment of tax withholding for stock-based awards	(4.9		)	—			—			(4.9		)
Proceeds from termination of mortgage swap	—			0.9			—			0.9
Repurchases of common stock, amounts based on settlement date	(183.9		)	—			—			(183.9		)
Dividends paid	(20.9		)	—			—			(20.9		)
Borrowings (repayments) with subsidiaries	289.4			(300.7		)	11.3			—
Investment in subsidiaries	(227.8		)	209.9			17.8			—
Net cash provided by (used in) financing activities	(158.3		)	(16.8		)	65.5			(109.5		)
Effect of exchange rate changes on cash	—			—			(3.3		)	(3.3		)
Net increase (decrease) in cash, cash equivalents and restricted cash	—			(5.5		)	(5.4		)	(10.9		)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period	—			10.1			19.5			29.6
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of period	$	—		$	4.6		$	14.1		$	18.7

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended December 31, 2017

(In millions)



	Group 1 Automotive, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Total Company
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	214.6		$	(13.8	)	$	(4.3	)	$	196.5
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for acquisitions, net of cash received	—			(62.5		)	(46.6		)	(109.1		)
Proceeds from disposition of franchises, property and equipment	—			8.3			2.4			10.7
Purchases of property and equipment	—			(185.3		)	(30.5		)	(215.8		)
Other	—			1.6			—			1.6
Net cash provided by (used in) investing activities	—			(237.9		)	(74.7		)	(312.6		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facility — floorplan line and other	—			7,019.1			—			7,019.1
Repayments on credit facility — floorplan line and other	—			(6,957.9		)	—			(6,957.9		)
Borrowings on credit facility — acquisition line	68.1			—			—			68.1
Repayments on credit facility — acquisition line	(42.3		)	—			—			(42.3		)
Borrowings on other debt	25.1			—			140.6			165.7
Principal payments on other debt	(0.3		)	(0.7		)	(120.2		)	(121.2		)
Borrowings on debt related to real estate	—			46.4			28.9			75.3
Principal payments on debt related to real estate	—			(22.9		)	(6.5		)	(29.4		)
Proceeds from employee stock purchase plan	7.1			—			—			7.1
Payment of tax withholding for stock-based awards	(2.5		)	—			—			(2.5		)
Repurchases of common stock, amounts based on settlement date	(40.1		)	—			—			(40.1		)
Dividends paid	(20.5		)	—			—			(20.5		)
Borrowings (repayments) with subsidiaries	2.9			(32.7		)	29.8			—
Investment in subsidiaries	(212.1		)	202.4			9.7			—
Net cash provided by (used in) financing activities	(214.6		)	253.7			82.4			121.5
Net increase (decrease) in cash, cash equivalents and restricted cash	—			2.1			3.3			5.4
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, beginning of period	—			8.0			16.2			24.2
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, end of period	$	—		$	10.1		$	19.5		$	29.6