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Form
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10-Q
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Avis Budget Group, Inc.
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(Exact name of registrant as specified in its charter)
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Delaware
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06-0918165
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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6 Sylvan Way
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Parsippany,
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NJ
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07054
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(Address of principal executive offices)
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(Zip Code)
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(973)
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496-4700
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(Registrant’s telephone number, including area code)
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Large Accelerated Filer
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☒
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Accelerated Filer
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☐
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Non-accelerated Filer
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☐
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Smaller Reporting Company
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☐
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Emerging Growth Company
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☐
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, Par Value $0.01
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CAR
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The NASDAQ Global Select Market
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Page
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PART I
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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||
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•
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the high level of competition in the mobility industry, including from new companies or technology, and the impact such competition may have on pricing and rental volume;
|
•
|
a change in our fleet costs as a result of a change in the cost of new vehicles, manufacturer recalls, disruption in the supply of new vehicles, and/or a change in the price at which we dispose of used vehicles either in the used vehicle market or under repurchase or guaranteed depreciation programs;
|
•
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the results of operations or financial condition of the manufacturers of our cars, which could impact their ability to perform their payment obligations under our agreements with them, including repurchase and/or guaranteed depreciation arrangements, and/or their willingness or ability to make cars available to us or the rental car industry as a whole on commercially reasonable terms or at all;
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•
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a change in travel demand, including changes or disruptions in airline passenger traffic;
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•
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any change in economic conditions generally, particularly during our peak season or in key market segments;
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•
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an occurrence or threat of terrorism, pandemic disease, natural disasters, military conflict, civil unrest or political instability in the locations in which we operate;
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•
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any substantial changes in the cost or supply of fuel, vehicle parts, energy, labor or other resources on which we depend to operate our business;
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•
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our ability to continue to successfully implement our business strategies, achieve and maintain cost savings and adapt our business to changes in mobility;
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•
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political, economic or commercial instability in the countries in which we operate, and our ability to conform to multiple and conflicting laws or regulations in those countries;
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•
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our dependence on third-party distribution channels, third-party suppliers of other services and co-marketing arrangements with third parties;
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•
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our dependence on the performance and retention of our senior management and key employees;
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•
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risks related to completed or future acquisitions or investments that we may pursue, including the incurrence of incremental indebtedness to help fund such transactions and our ability to promptly and effectively integrate any acquired businesses or capitalize on joint ventures, partnerships and other investments;
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•
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our ability to utilize derivative instruments, and the impact of derivative instruments we utilize, which can be affected by fluctuations in interest rates, gasoline prices and exchange rates, changes in government regulations and other factors;
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•
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our exposure to uninsured or unpaid claims in excess of historical levels;
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•
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risks associated with litigation, governmental or regulatory inquiries, or any failure or inability to comply with laws, regulations or contractual obligations or any changes in laws, regulations or contractual obligations, including with respect to personally identifiable information and consumer privacy, labor and employment, and tax;
|
•
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risks related to protecting the integrity of, and preventing unauthorized access to, our information technology systems or those of our third-party vendors, and protecting the confidential information of our employees and customers against security breaches, including physical or cybersecurity breaches, attacks, or other disruptions, and compliance with privacy and data protection regulation;
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•
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any impact on us from the actions of our licensees, dealers, third-party vendors and independent contractors;
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•
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any major disruptions in our communication networks or information systems;
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•
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risks related to tax obligations and the effect of future changes in tax laws and accounting standards;
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•
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risks related to our indebtedness, including our substantial outstanding debt obligations, potential interest rate increases, and our ability to incur substantially more debt;
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•
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our ability to obtain financing for our global operations, including the funding of our vehicle fleet through the issuance of asset-backed securities and use of the global lending markets;
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•
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our ability to meet the financial and other covenants contained in the agreements governing our indebtedness;
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•
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our ability to accurately estimate our future results; and
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•
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other business, economic, competitive, governmental, regulatory, political or technological factors affecting our operations, pricing or services.
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Item 1.
|
Financial Statements
|
|
|
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Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues
|
$
|
2,753
|
|
|
$
|
2,778
|
|
|
$
|
7,010
|
|
|
$
|
7,074
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Expenses
|
|
|
|
|
|
|
|
||||||||||
|
Operating
|
1,291
|
|
|
1,294
|
|
|
3,534
|
|
|
3,561
|
|
|||||
|
Vehicle depreciation and lease charges, net
|
551
|
|
|
587
|
|
|
1,579
|
|
|
1,693
|
|
|||||
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Selling, general and administrative
|
350
|
|
|
336
|
|
|
947
|
|
|
953
|
|
|||||
|
Vehicle interest, net
|
90
|
|
|
85
|
|
|
261
|
|
|
237
|
|
|||||
|
Non-vehicle related depreciation and amortization
|
62
|
|
|
62
|
|
|
195
|
|
|
190
|
|
|||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|||||||||
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Interest expense
|
49
|
|
|
44
|
|
|
139
|
|
|
139
|
|
|||||
|
Early extinguishment of debt
|
10
|
|
|
—
|
|
|
10
|
|
|
5
|
|
|||||
|
Restructuring and other related charges
|
22
|
|
|
4
|
|
|
66
|
|
|
14
|
|
|||||
|
Transaction-related costs, net
|
—
|
|
|
11
|
|
|
6
|
|
|
18
|
|
|||||
Total expenses
|
2,425
|
|
|
2,423
|
|
|
6,737
|
|
|
6,810
|
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Income before income taxes
|
328
|
|
|
355
|
|
|
273
|
|
|
264
|
|
||||||
Provision for income taxes
|
139
|
|
|
142
|
|
|
113
|
|
|
112
|
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
189
|
|
|
$
|
213
|
|
|
$
|
160
|
|
|
$
|
152
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Comprehensive income
|
$
|
155
|
|
|
$
|
207
|
|
|
$
|
119
|
|
|
$
|
104
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share
|
|
|
|
|
|
|
|
||||||||||
|
Basic
|
$
|
2.52
|
|
|
$
|
2.71
|
|
|
$
|
2.12
|
|
|
$
|
1.90
|
|
|
|
Diluted
|
$
|
2.50
|
|
|
$
|
2.68
|
|
|
$
|
2.10
|
|
|
$
|
1.88
|
|
|
|
September 30,
2019 |
|
December 31, 2018
|
||||
Assets
|
|
|
|
|||||
Current assets:
|
|
|
|
|||||
|
Cash and cash equivalents
|
$
|
615
|
|
|
$
|
615
|
|
|
Receivables, net
|
872
|
|
|
955
|
|
||
|
Other current assets
|
660
|
|
|
604
|
|
||
Total current assets
|
2,147
|
|
|
2,174
|
|
|||
|
|
|
|
|
||||
Property and equipment, net
|
752
|
|
|
736
|
|
|||
Operating lease right-of-use assets
|
2,365
|
|
|
—
|
|
|||
Deferred income taxes
|
1,360
|
|
|
1,301
|
|
|||
Goodwill
|
1,083
|
|
|
1,092
|
|
|||
Other intangibles, net
|
792
|
|
|
825
|
|
|||
Other non-current assets
|
221
|
|
|
242
|
|
|||
Total assets exclusive of assets under vehicle programs
|
8,720
|
|
|
6,370
|
|
|||
|
|
|
|
|
||||
Assets under vehicle programs:
|
|
|
|
|||||
|
Program cash
|
89
|
|
|
115
|
|
||
|
Vehicles, net
|
12,752
|
|
|
11,474
|
|
||
|
Receivables from vehicle manufacturers and other
|
905
|
|
|
631
|
|
||
|
Investment in Avis Budget Rental Car Funding (AESOP) LLC—related party
|
642
|
|
|
559
|
|
||
|
|
14,388
|
|
|
12,779
|
|
||
Total assets
|
$
|
23,108
|
|
|
$
|
19,149
|
|
|
|
|
|
|
|
||||
Liabilities and stockholders’ equity
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|||||
|
Accounts payable and other current liabilities
|
$
|
2,195
|
|
|
$
|
1,693
|
|
|
Short-term debt and current portion of long-term debt
|
95
|
|
|
23
|
|
||
Total current liabilities
|
2,290
|
|
|
1,716
|
|
|||
|
|
|
|
|
||||
Long-term debt
|
3,388
|
|
|
3,528
|
|
|||
Long-term operating lease liabilities
|
1,966
|
|
|
—
|
|
|||
Other non-current liabilities
|
748
|
|
|
767
|
|
|||
Total liabilities exclusive of liabilities under vehicle programs
|
8,392
|
|
|
6,011
|
|
|||
|
|
|
|
|
||||
Liabilities under vehicle programs:
|
|
|
|
|||||
|
Debt
|
3,722
|
|
|
2,874
|
|
||
|
Debt due to Avis Budget Rental Car Funding (AESOP) LLC—related party
|
7,870
|
|
|
7,358
|
|
||
|
Deferred income taxes
|
2,058
|
|
|
1,961
|
|
||
|
Other
|
571
|
|
|
531
|
|
||
|
|
14,221
|
|
|
12,724
|
|
||
Commitments and contingencies (Note 13)
|
|
|
|
|||||
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|||||
|
Preferred stock, $0.01 par value—authorized 10 shares; none issued and outstanding, respectively
|
—
|
|
|
—
|
|
||
|
Common stock, $0.01 par value—authorized 250 shares; issued 137 shares, respectively
|
1
|
|
|
1
|
|
||
|
Additional paid-in capital
|
6,735
|
|
|
6,771
|
|
||
|
Accumulated deficit
|
(927
|
)
|
|
(1,091
|
)
|
||
|
Accumulated other comprehensive loss
|
(173
|
)
|
|
(133
|
)
|
||
|
Treasury stock, at cost—63 and 61 shares, respectively
|
(5,141
|
)
|
|
(5,134
|
)
|
||
Total stockholders’ equity
|
495
|
|
|
414
|
|
|||
Total liabilities and stockholders’ equity
|
$
|
23,108
|
|
|
$
|
19,149
|
|
|
|
|
Nine Months Ended
September 30, |
||||||
|
|
|
2019
|
|
2018
|
||||
Operating activities
|
|
|
|
||||||
Net income
|
$
|
160
|
|
|
$
|
152
|
|
||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||||
|
Vehicle depreciation
|
1,457
|
|
|
1,536
|
|
|||
|
Amortization of right-of-use assets
|
752
|
|
|
—
|
|
|||
|
(Gain) loss on sale of vehicles, net
|
(69
|
)
|
|
(35
|
)
|
|||
|
Non-vehicle related depreciation and amortization
|
195
|
|
|
190
|
|
|||
|
Stock-based compensation
|
18
|
|
|
18
|
|
|||
|
Amortization of debt financing fees
|
23
|
|
|
21
|
|
|||
|
Early extinguishment of debt costs
|
10
|
|
|
5
|
|
|||
|
Net change in assets and liabilities:
|
|
|
|
|||||
|
|
Receivables
|
(65
|
)
|
|
(140
|
)
|
||
|
|
Income taxes and deferred income taxes
|
40
|
|
|
78
|
|
||
|
|
Accounts payable and other current liabilities
|
41
|
|
|
138
|
|
||
|
Operating lease liabilities
|
(746
|
)
|
|
—
|
|
|||
|
Other, net
|
115
|
|
|
132
|
|
|||
Net cash provided by operating activities
|
1,931
|
|
|
2,095
|
|
||||
|
|
|
|
|
|
||||
Investing activities
|
|
|
|
||||||
Property and equipment additions
|
(178
|
)
|
|
(157
|
)
|
||||
Proceeds received on asset sales
|
7
|
|
|
9
|
|
||||
Net assets acquired (net of cash acquired)
|
(68
|
)
|
|
(64
|
)
|
||||
Other, net
|
80
|
|
|
(44
|
)
|
||||
Net cash used in investing activities exclusive of vehicle programs
|
(159
|
)
|
|
(256
|
)
|
||||
|
|
|
|
|
|
||||
Vehicle programs:
|
|
|
|
||||||
|
Investment in vehicles
|
(10,621
|
)
|
|
(10,079
|
)
|
|||
|
Proceeds received on disposition of vehicles
|
7,826
|
|
|
6,752
|
|
|||
|
Investment in debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party
|
(221
|
)
|
|
(116
|
)
|
|||
|
Proceeds from debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party
|
137
|
|
|
22
|
|
|||
|
|
(2,879
|
)
|
|
(3,421
|
)
|
|||
Net cash used in investing activities
|
(3,038
|
)
|
|
(3,677
|
)
|
Avis Budget Group, Inc.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Continued)
(In millions)
(Unaudited)
|
||||||||
|
|
Nine Months Ended
September 30, |
||||||
|
|
2019
|
|
2018
|
||||
Financing activities
|
|
|
|
|||||
Proceeds from long-term borrowings
|
402
|
|
|
81
|
|
|||
Payments on long-term borrowings
|
(427
|
)
|
|
(99
|
)
|
|||
Net change in short-term borrowings
|
—
|
|
|
(4
|
)
|
|||
Repurchases of common stock
|
(65
|
)
|
|
(143
|
)
|
|||
Debt financing fees
|
(6
|
)
|
|
(9
|
)
|
|||
Other, net
|
—
|
|
|
3
|
|
|||
Net cash used in financing activities exclusive of vehicle programs
|
(96
|
)
|
|
(171
|
)
|
|||
|
|
|
|
|
||||
Vehicle programs:
|
|
|
|
|||||
|
Proceeds from borrowings
|
16,042
|
|
|
13,371
|
|
||
|
Payments on borrowings
|
(14,838
|
)
|
|
(11,727
|
)
|
||
|
Debt financing fees
|
(18
|
)
|
|
(19
|
)
|
||
|
|
1,186
|
|
|
1,625
|
|
||
Net cash provided by financing activities
|
1,090
|
|
|
1,454
|
|
|||
|
|
|
|
|
||||
Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash
|
(10
|
)
|
|
(5
|
)
|
|||
|
|
|
|
|
||||
Net decrease in cash and cash equivalents, program and restricted cash
|
(27
|
)
|
|
(133
|
)
|
|||
Cash and cash equivalents, program and restricted cash, beginning of period
|
735
|
|
|
901
|
|
|||
Cash and cash equivalents, program and restricted cash, end of period
|
$
|
708
|
|
|
$
|
768
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Total Stockholders’ Equity
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balance at June 30, 2019
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,723
|
|
|
$
|
(1,116
|
)
|
|
$
|
(139
|
)
|
|
(61.1
|
)
|
|
$
|
(5,093
|
)
|
|
$
|
376
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
189
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
155
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net activity related to restricted stock units
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
10
|
|
|
7
|
|
||||||
Option premiums settled
|
—
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16
|
|
||||||
Activity related to employee stock purchase plan
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.1
|
)
|
|
(59
|
)
|
|
(59
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at September 30, 2019
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,735
|
|
|
$
|
(927
|
)
|
|
$
|
(173
|
)
|
|
(63.1
|
)
|
|
$
|
(5,141
|
)
|
|
$
|
495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at June 30, 2018
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,779
|
|
|
$
|
(1,316
|
)
|
|
$
|
(72
|
)
|
|
(57.4
|
)
|
|
$
|
(5,020
|
)
|
|
$
|
372
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
213
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
207
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net activity related to restricted stock units
|
—
|
|
|
—
|
|
|
(12
|
)
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
16
|
|
|
4
|
|
||||||
Activity related to employee stock purchase plan
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.9
|
)
|
|
(62
|
)
|
|
(62
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at September 30, 2018
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,766
|
|
|
$
|
(1,103
|
)
|
|
$
|
(78
|
)
|
|
(59.1
|
)
|
|
$
|
(5,065
|
)
|
|
$
|
521
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Total Stockholders’ Equity
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
Shares
|
|
Amount
|
|
||||||||||||||||||
Balance at December 31, 2018
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,771
|
|
|
$
|
(1,091
|
)
|
|
$
|
(133
|
)
|
|
(61.5
|
)
|
|
$
|
(5,134
|
)
|
|
$
|
414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cumulative effect of accounting change
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
160
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
119
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net activity related to restricted stock units
|
—
|
|
|
—
|
|
|
(30
|
)
|
|
—
|
|
|
—
|
|
|
0.4
|
|
|
46
|
|
|
16
|
|
||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
5
|
|
|
—
|
|
||||||
Activity related to employee stock purchase plan
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.1
|
)
|
|
(59
|
)
|
|
(59
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at September 30, 2019
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,735
|
|
|
$
|
(927
|
)
|
|
$
|
(173
|
)
|
|
(63.1
|
)
|
|
$
|
(5,141
|
)
|
|
$
|
495
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2017
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,820
|
|
|
$
|
(1,222
|
)
|
|
$
|
(24
|
)
|
|
(56.3
|
)
|
|
$
|
(5,002
|
)
|
|
$
|
573
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cumulative effect of accounting change
|
—
|
|
|
—
|
|
|
—
|
|
|
(33
|
)
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(39
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
152
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(48
|
)
|
|
—
|
|
|
—
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
104
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net activity related to restricted stock units
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|
48
|
|
|
10
|
|
||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
17
|
|
|
2
|
|
||||||
Activity related to employee stock purchase plan
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||
Repurchase of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3.5
|
)
|
|
(129
|
)
|
|
(129
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at September 30, 2018
|
137.1
|
|
|
$
|
1
|
|
|
$
|
6,766
|
|
|
$
|
(1,103
|
)
|
|
$
|
(78
|
)
|
|
(59.1
|
)
|
|
$
|
(5,065
|
)
|
|
$
|
521
|
|
1.
|
Basis of Presentation
|
•
|
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 the areas in which the Company does not operate directly.
|
•
|
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 the areas in which the Company does not operate directly.
|
|
As of September 30,
|
||||||
|
2019
|
|
2018
|
||||
Cash and cash equivalents
|
$
|
615
|
|
|
$
|
605
|
|
Program cash
|
89
|
|
|
151
|
|
||
Restricted cash (a)
|
4
|
|
|
12
|
|
||
Total cash and cash equivalents, program and restricted cash
|
$
|
708
|
|
|
$
|
768
|
|
(a)
|
Included within other current assets.
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Americas
|
$
|
1,868
|
|
|
$
|
1,844
|
|
|
$
|
4,822
|
|
|
$
|
4,782
|
|
|
Europe, Middle East and Africa
|
742
|
|
|
784
|
|
|
1,747
|
|
|
1,830
|
|
|||||
Asia and Australasia
|
143
|
|
|
150
|
|
|
441
|
|
|
462
|
|
|||||
Total revenues
|
$
|
2,753
|
|
|
$
|
2,778
|
|
|
$
|
7,010
|
|
|
$
|
7,074
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Avis
|
$
|
1,580
|
|
|
$
|
1,599
|
|
|
$
|
4,008
|
|
|
$
|
4,095
|
|
|
Budget
|
950
|
|
|
953
|
|
|
2,417
|
|
|
2,372
|
|
|||||
Other
|
223
|
|
|
226
|
|
|
585
|
|
|
607
|
|
|||||
Total revenues
|
$
|
2,753
|
|
|
$
|
2,778
|
|
|
$
|
7,010
|
|
|
$
|
7,074
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
Balance, January 1
|
$
|
64
|
|
|
$
|
69
|
|
Revenue deferred
|
19
|
|
|
12
|
|
||
Revenue recognized
|
(16
|
)
|
|
(9
|
)
|
||
Balance, September 30
|
$
|
67
|
|
|
$
|
72
|
|
2.
|
Leases
|
|
Three Months Ended September 30, 2019
|
|
Nine Months Ended
September 30, 2019 |
|||||
Americas
|
$
|
1,856
|
|
|
$
|
4,792
|
|
|
Europe, Middle East and Africa
|
717
|
|
|
1,684
|
|
|||
Asia and Australasia
|
140
|
|
|
431
|
|
|||
Total lease revenues
|
$
|
2,713
|
|
|
$
|
6,907
|
|
|
Three Months Ended September 30, 2019
|
|
Nine Months Ended
September 30, 2019 |
|||||
Avis
|
$
|
1,559
|
|
|
$
|
3,953
|
|
|
Budget
|
935
|
|
|
2,379
|
|
|||
Other
|
219
|
|
|
575
|
|
|||
Total lease revenues
|
$
|
2,713
|
|
|
$
|
6,907
|
|
|
Three Months Ended September 30, 2019
|
|
Nine Months Ended
September 30, 2019 |
||||
Property leases (a)
|
|
|
|
||||
Operating lease expense
|
$
|
184
|
|
|
$
|
540
|
|
Variable lease expense
|
93
|
|
|
219
|
|
||
Sublease income
|
(2
|
)
|
|
(6
|
)
|
||
Total property lease expense
|
$
|
275
|
|
|
$
|
753
|
|
|
|
|
|
||||
Vehicle leases
|
|
|
|
||||
Finance lease expense:
|
|
|
|
||||
Amortization of ROU assets (b)
|
$
|
8
|
|
|
$
|
31
|
|
Interest on lease liabilities (c)
|
1
|
|
|
3
|
|
||
Operating lease expense (b)
|
72
|
|
|
191
|
|
||
Total vehicle lease expense
|
$
|
81
|
|
|
$
|
225
|
|
(a)
|
Primarily included in operating expense.
|
(b)
|
Included in vehicle depreciation and lease charges, net.
|
(c)
|
Included in vehicle interest, net.
|
|
As of
September 30, 2019 |
||
Property leases
|
|
||
Operating lease ROU assets
|
$
|
2,365
|
|
|
|
||
Short-term operating lease liabilities (a)
|
$
|
420
|
|
Long-term operating lease liabilities
|
1,966
|
|
|
Operating lease liabilities
|
$
|
2,386
|
|
|
|
||
Weighted average remaining lease term
|
9.4 years
|
|
|
Weighted average discount rate
|
4.50
|
%
|
|
|
|
||
Vehicle leases
|
|
||
Finance
|
|
||
Finance lease ROU assets, gross
|
$
|
337
|
|
Accumulated amortization
|
(55
|
)
|
|
Finance lease ROU assets, net (b)
|
$
|
282
|
|
|
|
||
Short-term vehicle finance lease liabilities
|
$
|
96
|
|
Long-term vehicle finance lease liabilities
|
164
|
|
|
Vehicle finance lease liabilities (c)
|
$
|
260
|
|
|
|
||
Weighted average remaining lease term
|
1.9 years
|
|
|
Weighted average discount rate
|
1.77
|
%
|
|
|
|
||
Operating
|
|
||
Vehicle operating lease ROU assets (d)
|
$
|
205
|
|
|
|
||
Short-term vehicle operating lease liabilities
|
$
|
136
|
|
Long-term vehicle operating lease liabilities
|
69
|
|
|
Vehicle operating lease liabilities (e)
|
$
|
205
|
|
|
|
||
Weighted average remaining lease term
|
1.7 years
|
|
|
Weighted average discount rate
|
2.91
|
%
|
(a)
|
Included in Accounts payable and other current liabilities.
|
(b)
|
Included in Vehicles, net within Assets under vehicle programs.
|
(c)
|
Included in Debt within Liabilities under vehicle programs.
|
(d)
|
Included in Receivables from vehicle manufacturers and other within Assets under vehicle programs.
|
(e)
|
Included in Other within Liabilities under vehicle programs.
|
|
Nine Months Ended
September 30, 2019 |
||
Cash payments for lease liabilities within operating activities:
|
|
||
Property operating leases
|
$
|
564
|
|
Vehicle operating leases
|
182
|
|
|
Vehicle finance leases
|
3
|
|
|
Cash payments for lease liabilities within financing activities:
|
|
||
Vehicle finance leases
|
193
|
|
|
Non-cash activities - increase (decrease) in ROU assets in exchange for lease liabilities:
|
|
||
Property operating leases (a)
|
149
|
|
|
Vehicle operating leases (a)
|
209
|
|
|
Vehicle finance leases
|
247
|
|
(a)
|
ROU assets obtained in exchange for lease liabilities from initial recognition.
|
|
Property Operating Leases
|
|
Vehicle Finance Leases
|
|
Vehicle Operating Leases
|
||||||
Within 1 year
|
$
|
517
|
|
|
$
|
96
|
|
|
$
|
140
|
|
Between 1 and 2 years
|
424
|
|
|
21
|
|
|
52
|
|
|||
Between 2 and 3 years
|
357
|
|
|
138
|
|
|
15
|
|
|||
Between 3 and 4 years
|
298
|
|
|
5
|
|
|
4
|
|
|||
Between 4 and 5 years
|
215
|
|
|
—
|
|
|
—
|
|
|||
Thereafter
|
1,159
|
|
|
—
|
|
|
—
|
|
|||
Total lease payments
|
2,970
|
|
|
260
|
|
|
211
|
|
|||
Less: Imputed interest
|
(584
|
)
|
|
—
|
|
|
(6
|
)
|
|||
Total
|
$
|
2,386
|
|
|
$
|
260
|
|
|
$
|
205
|
|
|
Amount
|
||
2019
|
$
|
835
|
|
2020
|
476
|
|
|
2021
|
345
|
|
|
2022
|
253
|
|
|
2023
|
162
|
|
|
Thereafter
|
590
|
|
|
|
$
|
2,661
|
|
3.
|
Restructuring and Other Related Charges
|
|
|
|
|
Americas
|
|
International
|
|
Total
|
||||||||
Balance as of January 1, 2019
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|||
|
Restructuring expense:
|
|
|
|
|
|
|
|
||||||||
|
Brazil
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|||||
|
T19
|
|
|
34
|
|
|
11
|
|
|
45
|
|
|||||
|
Restructuring payment/utilization:
|
|
|
|
|
|
|
|
||||||||
|
Brazil
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
|
T19
|
|
|
(34
|
)
|
|
(9
|
)
|
|
(43
|
)
|
|||||
|
Workforce planning
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||||
Balance as of September 30, 2019
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
5
|
|
|||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Personnel
|
|
Facility
Related |
|
Other (a)
|
|
Total
|
||||||||
Balance as of January 1, 2019
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
|
Restructuring expense:
|
|
|
|
|
|
|
|
||||||||
|
Brazil
|
1
|
|
|
1
|
|
|
4
|
|
|
6
|
|
||||
|
T19
|
16
|
|
|
—
|
|
|
29
|
|
|
45
|
|
||||
|
Restructuring payment/utilization:
|
|
|
|
|
|
|
|
||||||||
|
Brazil
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(4
|
)
|
||||
|
T19
|
(15
|
)
|
|
—
|
|
|
(28
|
)
|
|
(43
|
)
|
||||
|
Workforce planning
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||
Balance as of September 30, 2019
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
5
|
|
(a)
|
Includes expenses primarily related to the disposition of vehicles.
|
4.
|
Earnings Per Share
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income for basic and diluted EPS
|
$
|
189
|
|
|
$
|
213
|
|
|
$
|
160
|
|
|
$
|
152
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
75.2
|
|
|
78.8
|
|
|
75.6
|
|
|
80.1
|
|
|||||
Options and non-vested stock (a)
|
0.5
|
|
|
0.7
|
|
|
0.6
|
|
|
0.9
|
|
|||||
Diluted weighted average shares outstanding
|
75.7
|
|
|
79.5
|
|
|
76.2
|
|
|
81.0
|
|
|||||
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share:
|
|
|
|
|
|
|
|
|||||||||
|
Basic
|
$
|
2.52
|
|
|
$
|
2.71
|
|
|
$
|
2.12
|
|
|
$
|
1.90
|
|
|
Diluted
|
$
|
2.50
|
|
|
$
|
2.68
|
|
|
$
|
2.10
|
|
|
$
|
1.88
|
|
(a)
|
For the three months ended September 30, 2019 and 2018, 0.4 million and 0.5 million non-vested stock awards, respectively, have an anti-dilutive effect and therefore are excluded from the computation of diluted weighted average shares outstanding. For the nine months ended September 30, 2019 and 2018, 0.5 million and 0.2 million non-vested stock awards, respectively, have an anti-dilutive effect and therefore are excluded from the computation of diluted weighted average shares outstanding.
|
5.
|
Acquisitions
|
6.
|
Other Current Assets
|
|
As of
September 30, 2019 |
|
As of December 31, 2018
|
||||
Prepaid expenses
|
$
|
259
|
|
|
$
|
241
|
|
Sales and use taxes
|
246
|
|
|
180
|
|
||
Other
|
155
|
|
|
183
|
|
||
Other current assets
|
$
|
660
|
|
|
$
|
604
|
|
7.
|
Intangible Assets
|
|
As of September 30, 2019
|
|
As of December 31, 2018
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Amortized Intangible Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
License agreements
|
$
|
229
|
|
|
$
|
104
|
|
|
$
|
125
|
|
|
$
|
305
|
|
|
$
|
168
|
|
|
$
|
137
|
|
Customer relationships
|
250
|
|
|
157
|
|
|
93
|
|
|
251
|
|
|
141
|
|
|
110
|
|
||||||
Other
|
49
|
|
|
23
|
|
|
26
|
|
|
52
|
|
|
21
|
|
|
31
|
|
||||||
Total
|
$
|
528
|
|
|
$
|
284
|
|
|
$
|
244
|
|
|
$
|
608
|
|
|
$
|
330
|
|
|
$
|
278
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unamortized Intangible Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
$
|
1,083
|
|
|
|
|
|
|
$
|
1,092
|
|
|
|
|
|
||||||||
Trademarks
|
$
|
548
|
|
|
|
|
|
|
$
|
547
|
|
|
|
|
|
8.
|
Vehicle Rental Activities
|
|
As of
|
|
As of
|
||||
|
September 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Rental vehicles
|
$
|
13,691
|
|
|
$
|
12,548
|
|
Less: Accumulated depreciation
|
(1,524
|
)
|
|
(1,670
|
)
|
||
|
12,167
|
|
|
10,878
|
|
||
Vehicles held for sale
|
585
|
|
|
596
|
|
||
Vehicles, net
|
$
|
12,752
|
|
|
$
|
11,474
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Depreciation expense
|
$
|
516
|
|
|
$
|
540
|
|
|
$
|
1,457
|
|
|
$
|
1,536
|
|
Lease charges
|
72
|
|
|
72
|
|
|
191
|
|
|
192
|
|
||||
(Gain) loss on sale of vehicles, net
|
(37
|
)
|
|
(25
|
)
|
|
(69
|
)
|
|
(35
|
)
|
||||
Vehicle depreciation and lease charges, net
|
$
|
551
|
|
|
$
|
587
|
|
|
$
|
1,579
|
|
|
$
|
1,693
|
|
9.
|
Income Taxes
|
10.
|
Accounts Payable and Other Current Liabilities
|
|
As of
|
|
As of
|
||||
|
September 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Short-term operating lease liabilities
|
$
|
420
|
|
|
$
|
—
|
|
Accounts payable
|
382
|
|
|
371
|
|
||
Accrued sales and use taxes
|
267
|
|
|
208
|
|
||
Accrued advertising and marketing
|
206
|
|
|
192
|
|
||
Accrued payroll and related
|
184
|
|
|
200
|
|
||
Public liability and property damage insurance liabilities – current
|
150
|
|
|
149
|
|
||
Deferred lease revenues – current
|
141
|
|
|
140
|
|
||
Other
|
445
|
|
|
433
|
|
||
Accounts payable and other current liabilities
|
$
|
2,195
|
|
|
$
|
1,693
|
|
11.
|
Long-term Corporate Debt and Borrowing Arrangements
|
|
|
|
As of
|
|
As of
|
||||
|
Maturity
Dates
|
|
September 30,
|
|
December 31,
|
||||
|
|
2019
|
|
2018
|
|||||
5½% Senior Notes (a)
|
April 2023
|
|
$
|
275
|
|
|
$
|
675
|
|
6⅜% Senior Notes
|
April 2024
|
|
350
|
|
|
350
|
|
||
4⅛% euro-denominated Senior Notes
|
November 2024
|
|
327
|
|
|
344
|
|
||
Floating Rate Term Loan (b)
|
February 2025
|
|
1,115
|
|
|
1,123
|
|
||
5¼% Senior Notes
|
March 2025
|
|
375
|
|
|
375
|
|
||
4½% euro-denominated Senior Notes
|
May 2025
|
|
272
|
|
|
287
|
|
||
4¾% euro-denominated Senior Notes
|
January 2026
|
|
381
|
|
|
401
|
|
||
5¾% Senior Notes
|
July 2027
|
|
400
|
|
|
—
|
|
||
Other (c)
|
|
|
30
|
|
|
41
|
|
||
Deferred financing fees
|
|
|
(42
|
)
|
|
(45
|
)
|
||
Total
|
|
|
3,483
|
|
|
3,551
|
|
||
Less: Short-term debt and current portion of long-term debt
|
|
|
95
|
|
|
23
|
|
||
Long-term debt
|
|
|
$
|
3,388
|
|
|
$
|
3,528
|
|
(a)
|
A portion of these notes have been called for redemption.
|
(b)
|
The floating rate term loan is part of the Company’s senior revolving credit facility, which is secured by pledges of capital stock of certain subsidiaries of the Company, and liens on substantially all of the Company’s intellectual property and certain other real and personal property. As of September 30, 2019, the floating rate term loan due 2025 bears interest at one-month LIBOR plus 200 basis points, for an aggregate rate of 4.05%. The Company has entered into a swap to hedge $700 million of its interest rate exposure related to the floating rate term loan at an aggregate rate of 3.67%.
|
(c)
|
Primarily includes finance leases which are secured by liens on the related assets.
|
|
Total
Capacity
|
|
Outstanding
Borrowings
|
|
Letters of Credit Issued
|
|
Available
Capacity
|
||||||||
Senior revolving credit facility maturing 2023 (a)
|
$
|
1,800
|
|
|
$
|
—
|
|
|
$
|
947
|
|
|
$
|
853
|
|
(a)
|
The senior revolving credit facility bears interest at one-month LIBOR plus 200 basis points and is part of the Company’s senior credit facility, which is secured by pledges of capital stock of certain subsidiaries of the Company, and liens on substantially all of the Company’s intellectual property and certain other real and personal property.
|
12.
|
Debt Under Vehicle Programs and Borrowing Arrangements
|
|
As of
|
|
As of
|
||||
|
September 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Americas - Debt due to Avis Budget Rental Car Funding (a)
|
$
|
7,910
|
|
|
$
|
7,393
|
|
Americas - Debt borrowings (a)
|
923
|
|
|
635
|
|
||
International - Debt borrowings (a)
|
2,592
|
|
|
2,060
|
|
||
International - Finance leases (a)
|
217
|
|
|
191
|
|
||
Other
|
—
|
|
|
2
|
|
||
Deferred financing fees (b)
|
(50
|
)
|
|
(49
|
)
|
||
Total
|
$
|
11,592
|
|
|
$
|
10,232
|
|
(a)
|
The increase reflects additional borrowings principally to fund increases in the Company’s car rental fleet.
|
(b)
|
Deferred financing fees related to Debt due to Avis Budget Rental Car Funding as of September 30, 2019 and December 31, 2018 was $40 million and $35 million, respectively.
|
|
Debt under Vehicle Programs (a)
|
||
Within 1 year
|
$
|
1,795
|
|
Between 1 and 2 years (b)
|
4,783
|
|
|
Between 2 and 3 years
|
1,668
|
|
|
Between 3 and 4 years
|
1,088
|
|
|
Between 4 and 5 years
|
1,418
|
|
|
Thereafter
|
890
|
|
|
Total
|
$
|
11,642
|
|
(a)
|
Vehicle-backed debt primarily represents asset-backed securities.
|
(b)
|
Includes $3.7 billion of bank and bank-sponsored facilities.
|
|
Total
Capacity (a)
|
|
Outstanding
Borrowings (b)
|
|
Available
Capacity
|
||||||
Americas - Debt due to Avis Budget Rental Car Funding
|
$
|
10,000
|
|
|
$
|
7,910
|
|
|
$
|
2,090
|
|
Americas - Debt borrowings
|
935
|
|
|
923
|
|
|
12
|
|
|||
International - Debt borrowings
|
2,889
|
|
|
2,592
|
|
|
297
|
|
|||
International - Finance leases
|
253
|
|
|
217
|
|
|
36
|
|
|||
Total
|
$
|
14,077
|
|
|
$
|
11,642
|
|
|
$
|
2,435
|
|
(a)
|
Capacity is subject to maintaining sufficient assets to collateralize debt.
|
(b)
|
The outstanding debt is collateralized by vehicles and related assets of $9.4 billion for Americas - Debt due to Avis Budget Rental Car Funding; $1.2 billion for Americas - Debt borrowings; $3.0 billion for International - Debt borrowings; and $0.3 billion for International - Finance leases.
|
13.
|
Commitments and Contingencies
|
14.
|
Stockholders’ Equity
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
189
|
|
|
$
|
213
|
|
|
$
|
160
|
|
|
$
|
152
|
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|||||||||
|
Currency translation adjustments (net of tax of $(12), $(1), $(14), and $(6) respectively)
|
(31
|
)
|
|
(8
|
)
|
|
(21
|
)
|
|
(61
|
)
|
||||
|
Net unrealized gain (loss) on cash flow hedges (net of tax of $2, $0, and $9, and $(3) respectively)
|
(4
|
)
|
|
—
|
|
|
(25
|
)
|
|
8
|
|
||||
|
Minimum pension liability adjustment (net of tax of $(1), $0, $(1), and $(1), respectively)
|
1
|
|
|
2
|
|
|
5
|
|
|
5
|
|
||||
|
|
(34
|
)
|
|
(6
|
)
|
|
(41
|
)
|
|
(48
|
)
|
||||
Comprehensive income
|
$
|
155
|
|
|
$
|
207
|
|
|
$
|
119
|
|
|
$
|
104
|
|
|
|
Currency
Translation
Adjustments
|
|
Net Unrealized
Gains (Losses)
on Cash Flow
Hedges(a)
|
|
Net Unrealized Gains (Losses) on Available-for-Sale Securities
|
|
Minimum
Pension
Liability
Adjustment(b)
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
||||||||||
Balance, December 31, 2018
|
$
|
(3
|
)
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
(132
|
)
|
|
$
|
(133
|
)
|
|
|
Cumulative effect of accounting change (c)
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Balance, January 1, 2019
|
$
|
(3
|
)
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
(132
|
)
|
|
$
|
(132
|
)
|
|
|
Other comprehensive income (loss) before reclassifications
|
(21
|
)
|
|
(23
|
)
|
|
—
|
|
|
1
|
|
|
(43
|
)
|
|||||
|
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
4
|
|
|
2
|
|
|||||
Net current-period other comprehensive income (loss)
|
(21
|
)
|
|
(25
|
)
|
|
—
|
|
|
5
|
|
|
(41
|
)
|
||||||
Balance, September 30, 2019
|
$
|
(24
|
)
|
|
$
|
(22
|
)
|
|
$
|
—
|
|
|
$
|
(127
|
)
|
|
$
|
(173
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, December 31, 2017
|
$
|
71
|
|
|
$
|
5
|
|
|
$
|
2
|
|
|
$
|
(102
|
)
|
|
$
|
(24
|
)
|
|
|
Cumulative effect of accounting change
|
7
|
|
|
1
|
|
|
(2
|
)
|
|
(12
|
)
|
|
(6
|
)
|
|||||
Balance, January 1, 2018
|
$
|
78
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
(114
|
)
|
|
$
|
(30
|
)
|
|
|
Other comprehensive income (loss) before reclassifications
|
(61
|
)
|
|
9
|
|
|
—
|
|
|
1
|
|
|
(51
|
)
|
|||||
|
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
4
|
|
|
3
|
|
|||||
Net current-period other comprehensive income (loss)
|
(61
|
)
|
|
8
|
|
|
—
|
|
|
5
|
|
|
(48
|
)
|
||||||
Balance, September 30, 2018
|
$
|
17
|
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
(109
|
)
|
|
$
|
(78
|
)
|
(a)
|
For the three and nine months ended September 30, 2019, the amount reclassified from accumulated other comprehensive income (loss) into corporate interest expense was $1 million ($0 million, net of tax) and $4 million ($2 million, net of tax), respectively. For the three and nine months ended September 30, 2018, the amounts reclassified from accumulated other comprehensive income (loss) into corporate interest expense were $2 million ($1 million, net of tax), in each period.
|
(b)
|
For the three and nine months ended September 30, 2019, amounts reclassified from accumulated other comprehensive income (loss) into selling, general and administrative expenses were $2 million ($1 million, net of tax) and $6 million ($4 million, net of tax), respectively. For the three and nine months ended September 30, 2018, amounts reclassified from accumulated other
|
(c)
|
See Note 1–Basis of Presentation for the impact of adoption of ASU 2017-12.
|
15.
|
Stock-Based Compensation
|
|
|
|
Number of Shares
|
|
Weighted
Average Grant Date Fair Value |
|
Weighted Average Remaining Contractual Term (years)
|
|
Aggregate Intrinsic Value (in millions)
|
|||||
Time-based RSUs
|
|
|
|
|
|
|
|
|||||||
|
Outstanding at January 1, 2019
|
838
|
|
|
$
|
38.67
|
|
|
|
|
|
|||
|
|
Granted (a)
|
606
|
|
|
34.17
|
|
|
|
|
|
|||
|
|
Vested (b)
|
(502
|
)
|
|
36.00
|
|
|
|
|
|
|||
|
|
Forfeited
|
(56
|
)
|
|
38.76
|
|
|
|
|
|
|||
|
Outstanding and expected to vest at September 30, 2019 (c)
|
886
|
|
|
$
|
37.10
|
|
|
1.3
|
|
$
|
25
|
|
|
Performance-based and market-based RSUs
|
|
|
|
|
|
|
|
|||||||
|
Outstanding at January 1, 2019
|
1,169
|
|
|
$
|
35.14
|
|
|
|
|
|
|||
|
|
Granted (a)
|
570
|
|
|
34.56
|
|
|
|
|
|
|||
|
|
Vested
|
—
|
|
|
—
|
|
|
|
|
|
|||
|
|
Forfeited
|
(430
|
)
|
|
24.85
|
|
|
|
|
|
|||
|
Outstanding at September 30, 2019
|
1,309
|
|
|
$
|
38.27
|
|
|
1.6
|
|
$
|
37
|
|
|
|
Outstanding and expected to vest at September 30, 2019 (c)
|
524
|
|
|
$
|
39.31
|
|
|
1.9
|
|
$
|
15
|
|
(a)
|
Reflects the maximum number of stock units assuming achievement of all performance-, market- and time-vesting criteria and does not include those for non-employee directors. The weighted-average fair value of time-based RSUs and performance-based RSUs granted during the nine months ended September 30, 2018 was $48.41 and $48.52, respectively.
|
(b)
|
The total fair value of RSUs vested during September 30, 2019 and 2018 was $18 million and $20 million, respectively.
|
(c)
|
Aggregate unrecognized compensation expense related to time-based RSUs and performance-based RSUs amounted to $36 million and will be recognized over a weighted average vesting period of 1.5 years.
|
|
|
Number of Options
|
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Term (years) |
|
Aggregate Intrinsic Value (in millions)
|
||||||
Outstanding at January 1, 2019
|
57
|
|
|
$
|
0.79
|
|
|
0.1
|
|
|
$
|
1
|
|
|
|
Granted
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|||
|
Exercised (a)
|
(57
|
)
|
|
0.79
|
|
|
|
|
1
|
|
|||
|
Forfeited/expired
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|||
Outstanding and exercisable at September 30, 2019
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
(a)
|
Stock options exercised during the nine months ended September 30, 2018 had an aggregate intrinsic value of $8 million and the cash received was $2 million.
|
16.
|
Financial Instruments
|
|
As of September 30, 2019
|
||
Foreign exchange contracts
|
$
|
1,445
|
|
Interest rate caps (a)
|
7,754
|
|
|
Interest rate swaps
|
1,500
|
|
|
|
|
||
Commodity contracts (millions of gallons of unleaded gasoline)
|
5
|
|
(a)
|
Represents $5.4 billion of interest rate caps sold, partially offset by approximately $2.4 billion of interest rate caps purchased. These amounts exclude $3.0 billion of interest rate caps purchased by the Company’s Avis Budget Rental Car Funding subsidiary as it is not consolidated by the Company.
|
|
|
As of September 30, 2019
|
|
As of December 31, 2018
|
||||||||||||
|
|
Fair Value,
Derivative
Assets
|
|
Fair Value,
Derivative
Liabilities
|
|
Fair Value,
Derivative Assets |
|
Fair Value,
Derivative Liabilities |
||||||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
|||||||||
|
Interest rate swaps (a)
|
$
|
1
|
|
|
$
|
31
|
|
|
$
|
12
|
|
|
$
|
8
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
|||||||||
|
Foreign exchange contracts (b)
|
9
|
|
|
5
|
|
|
5
|
|
|
11
|
|
||||
|
Interest rate caps (c)
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
|
Commodity contracts (b)
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
|
Total
|
$
|
10
|
|
|
$
|
36
|
|
|
$
|
17
|
|
|
$
|
22
|
|
(a)
|
Included in other non-current assets or other non-current liabilities.
|
(b)
|
Included in other current assets or other current liabilities.
|
(c)
|
Included in assets under vehicle programs or liabilities under vehicle programs.
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Derivatives designated as hedging instruments (a)
|
|
|
|
|
|
|
|
|||||||||
|
Interest rate swaps (b)
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
(25
|
)
|
|
$
|
8
|
|
|
Euro-denominated notes (c)
|
32
|
|
|
3
|
|
|
37
|
|
|
16
|
|
||||
Derivatives not designated as hedging instruments (d)
|
|
|
|
|
|
|
|
|||||||||
|
Foreign exchange contracts (e)
|
10
|
|
|
6
|
|
|
21
|
|
|
25
|
|
||||
|
Interest rate caps (f)
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(4
|
)
|
||||
|
Commodity contracts (g)
|
(1
|
)
|
|
—
|
|
|
3
|
|
|
1
|
|
||||
|
Total
|
$
|
37
|
|
|
$
|
6
|
|
|
$
|
36
|
|
|
$
|
46
|
|
(a)
|
Recognized, net of tax, as a component of other comprehensive income (loss) within stockholders’ equity.
|
(b)
|
Classified as a net unrealized gain (loss) on cash flow hedges in accumulated other comprehensive income (loss). Refer to Note 14–Stockholders’ Equity for amounts reclassified from accumulated other comprehensive income into earnings.
|
(c)
|
Classified as a net investment hedge within currency translation adjustment in accumulated other comprehensive income (loss).
|
(d)
|
Gains (losses) related to derivative instruments are expected to be largely offset by (losses) gains on the underlying exposures being hedged.
|
(e)
|
For the three months ended September 30, 2019, included a $9 million gain in interest expense and a $1 million gain in operating expense and for the nine months ended September 30, 2019, included a $20 million gain in interest expense and a $1 million gain operating expense. For the three months ended September 30, 2018, included $5 million gain in interest expense and a $1 million gain in operating expense and for the nine months ended September 30, 2018, included a $12 million gain in interest expense and a $13 million gain in operating expense.
|
(f)
|
Included primarily in vehicle interest, net.
|
(g)
|
Included in operating expense.
|
|
|
As of September 30, 2019
|
|
As of December 31, 2018
|
||||||||||||
|
|
Carrying
Amount
|
|
Estimated
Fair
Value
|
|
Carrying
Amount
|
|
Estimated
Fair
Value
|
||||||||
Corporate debt
|
|
|
|
|
|
|
|
|||||||||
|
Short-term debt and current portion of long-term debt
|
$
|
95
|
|
|
$
|
96
|
|
|
$
|
23
|
|
|
$
|
23
|
|
|
Long-term debt
|
3,388
|
|
|
3,536
|
|
|
3,528
|
|
|
3,462
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Debt under vehicle programs
|
|
|
|
|
|
|
|
|||||||||
|
Vehicle-backed debt due to Avis Budget Rental Car Funding
|
$
|
7,870
|
|
|
$
|
8,053
|
|
|
$
|
7,358
|
|
|
$
|
7,383
|
|
|
Vehicle-backed debt
|
3,719
|
|
|
3,734
|
|
|
2,871
|
|
|
2,881
|
|
||||
|
Interest rate swaps and interest rate caps (a)
|
3
|
|
|
3
|
|
|
3
|
|
|
3
|
|
(a)
|
Derivatives in a liability position.
|
17.
|
Segment Information
|
(a)
|
Includes unallocated corporate overhead which is not attributable to a particular segment.
|
(a)
|
Includes unallocated corporate overhead which is not attributable to a particular segment.
|
18.
|
Guarantor and Non-Guarantor Consolidating Condensed Financial Statements
|
|
As of September 30,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
|
Non-Guarantor
|
|
Total
|
|
Non-Guarantor
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
600
|
|
|
$
|
615
|
|
|
$
|
529
|
|
|
$
|
605
|
|
Program cash
|
89
|
|
|
89
|
|
|
151
|
|
|
151
|
|
||||
Restricted cash (a)
|
4
|
|
|
4
|
|
|
12
|
|
|
12
|
|
||||
Total cash and cash equivalents, program and restricted cash
|
$
|
693
|
|
|
$
|
708
|
|
|
$
|
692
|
|
|
$
|
768
|
|
(a)
|
Included within other current assets.
|
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,606
|
|
|
$
|
1,745
|
|
|
$
|
(598
|
)
|
|
$
|
2,753
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Operating
|
1
|
|
|
1
|
|
|
755
|
|
|
534
|
|
|
—
|
|
|
1,291
|
|
|||||||
|
Vehicle depreciation and lease charges, net
|
—
|
|
|
—
|
|
|
553
|
|
|
526
|
|
|
(528
|
)
|
|
551
|
|
|||||||
|
Selling, general and administrative
|
14
|
|
|
5
|
|
|
195
|
|
|
136
|
|
|
—
|
|
|
350
|
|
|||||||
|
Vehicle interest, net
|
—
|
|
|
1
|
|
|
70
|
|
|
89
|
|
|
(70
|
)
|
|
90
|
|
|||||||
|
Non-vehicle related depreciation and amortization
|
—
|
|
|
1
|
|
|
37
|
|
|
24
|
|
|
—
|
|
|
62
|
|
|||||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Interest expense
|
—
|
|
|
36
|
|
|
1
|
|
|
12
|
|
|
—
|
|
|
49
|
|
||||||
|
|
Intercompany interest expense (income)
|
(3
|
)
|
|
(34
|
)
|
|
6
|
|
|
31
|
|
|
—
|
|
|
—
|
|
||||||
|
|
Early extinguishment of debt
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
|
Restructuring and other related charges
|
4
|
|
|
—
|
|
|
8
|
|
|
10
|
|
|
—
|
|
|
22
|
|
|||||||
|
Transaction-related costs, net
|
—
|
|
|
2
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|||||||
Total expenses
|
16
|
|
|
22
|
|
|
1,625
|
|
|
1,360
|
|
|
(598
|
)
|
|
2,425
|
|
||||||||
Income (loss) before income taxes and equity in earnings of subsidiaries
|
(16
|
)
|
|
(22
|
)
|
|
(19
|
)
|
|
385
|
|
|
—
|
|
|
328
|
|
||||||||
Provision for (benefit from) income taxes
|
(5
|
)
|
|
(8
|
)
|
|
70
|
|
|
82
|
|
|
—
|
|
|
139
|
|
||||||||
Equity in earnings of subsidiaries
|
200
|
|
|
214
|
|
|
303
|
|
|
—
|
|
|
(717
|
)
|
|
—
|
|
||||||||
Net income
|
$
|
189
|
|
|
$
|
200
|
|
|
$
|
214
|
|
|
$
|
303
|
|
|
$
|
(717
|
)
|
|
$
|
189
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Comprehensive income
|
$
|
155
|
|
|
$
|
166
|
|
|
$
|
185
|
|
|
$
|
273
|
|
|
$
|
(624
|
)
|
|
$
|
155
|
|
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,236
|
|
|
$
|
4,590
|
|
|
$
|
(1,816
|
)
|
|
$
|
7,010
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Operating
|
2
|
|
|
1
|
|
|
2,089
|
|
|
1,442
|
|
|
—
|
|
|
3,534
|
|
|||||||
|
Vehicle depreciation and lease charges, net
|
—
|
|
|
—
|
|
|
1,679
|
|
|
1,511
|
|
|
(1,611
|
)
|
|
1,579
|
|
|||||||
|
Selling, general and administrative
|
35
|
|
|
13
|
|
|
526
|
|
|
373
|
|
|
—
|
|
|
947
|
|
|||||||
|
Vehicle interest, net
|
—
|
|
|
1
|
|
|
205
|
|
|
260
|
|
|
(205
|
)
|
|
261
|
|
|||||||
|
Non-vehicle related depreciation and amortization
|
—
|
|
|
6
|
|
|
110
|
|
|
79
|
|
|
—
|
|
|
195
|
|
|||||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Interest expense
|
—
|
|
|
104
|
|
|
2
|
|
|
33
|
|
|
—
|
|
|
139
|
|
||||||
|
|
Intercompany interest expense (income)
|
(9
|
)
|
|
(26
|
)
|
|
20
|
|
|
15
|
|
|
—
|
|
|
—
|
|
||||||
|
|
Early extinguishment of debt
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
|
Restructuring and other related charges
|
15
|
|
|
—
|
|
|
33
|
|
|
18
|
|
|
—
|
|
|
66
|
|
|||||||
|
Transaction-related costs, net
|
—
|
|
|
3
|
|
|
(6
|
)
|
|
9
|
|
|
—
|
|
|
6
|
|
|||||||
Total expenses
|
43
|
|
|
112
|
|
|
4,658
|
|
|
3,740
|
|
|
(1,816
|
)
|
|
6,737
|
|
||||||||
Income (loss) before income taxes and equity in earnings of subsidiaries
|
(43
|
)
|
|
(112
|
)
|
|
(422
|
)
|
|
850
|
|
|
—
|
|
|
273
|
|
||||||||
Provision for (benefit from) income taxes
|
(15
|
)
|
|
(40
|
)
|
|
94
|
|
|
74
|
|
|
—
|
|
|
113
|
|
||||||||
Equity in earnings of subsidiaries
|
188
|
|
|
260
|
|
|
776
|
|
|
—
|
|
|
(1,224
|
)
|
|
—
|
|
||||||||
Net income
|
$
|
160
|
|
|
$
|
188
|
|
|
$
|
260
|
|
|
$
|
776
|
|
|
$
|
(1,224
|
)
|
|
$
|
160
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
$
|
119
|
|
|
$
|
147
|
|
|
$
|
243
|
|
|
$
|
757
|
|
|
$
|
(1,147
|
)
|
|
$
|
119
|
|
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,592
|
|
|
$
|
1,746
|
|
|
$
|
(560
|
)
|
|
$
|
2,778
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Operating
|
—
|
|
|
3
|
|
|
737
|
|
|
554
|
|
|
—
|
|
|
1,294
|
|
|||||||
|
Vehicle depreciation and lease charges, net
|
—
|
|
|
—
|
|
|
540
|
|
|
551
|
|
|
(504
|
)
|
|
587
|
|
|||||||
|
Selling, general and administrative
|
10
|
|
|
3
|
|
|
182
|
|
|
141
|
|
|
—
|
|
|
336
|
|
|||||||
|
Vehicle interest, net
|
—
|
|
|
—
|
|
|
59
|
|
|
82
|
|
|
(56
|
)
|
|
85
|
|
|||||||
|
Non-vehicle related depreciation and amortization
|
—
|
|
|
—
|
|
|
36
|
|
|
26
|
|
|
—
|
|
|
62
|
|
|||||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Interest expense
|
—
|
|
|
37
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
44
|
|
||||||
|
|
Intercompany interest expense (income)
|
(3
|
)
|
|
1
|
|
|
9
|
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
||||||
|
Transaction-related costs, net
|
—
|
|
|
—
|
|
|
2
|
|
|
9
|
|
|
—
|
|
|
11
|
|
|||||||
|
Restructuring and other related charges
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
4
|
|
|||||||
Total expenses
|
7
|
|
|
44
|
|
|
1,567
|
|
|
1,365
|
|
|
(560
|
)
|
|
2,423
|
|
||||||||
Income (loss) before income taxes and equity in earnings of subsidiaries
|
(7
|
)
|
|
(44
|
)
|
|
25
|
|
|
381
|
|
|
—
|
|
|
355
|
|
||||||||
Provision for (benefit from) income taxes
|
(2
|
)
|
|
(12
|
)
|
|
119
|
|
|
37
|
|
|
—
|
|
|
142
|
|
||||||||
Equity in earnings of subsidiaries
|
218
|
|
|
250
|
|
|
344
|
|
|
—
|
|
|
(812
|
)
|
|
—
|
|
||||||||
Net income
|
$
|
213
|
|
|
$
|
218
|
|
|
$
|
250
|
|
|
$
|
344
|
|
|
$
|
(812
|
)
|
|
$
|
213
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
$
|
207
|
|
|
$
|
212
|
|
|
$
|
244
|
|
|
$
|
338
|
|
|
$
|
(794
|
)
|
|
$
|
207
|
|
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,171
|
|
|
$
|
4,695
|
|
|
$
|
(1,792
|
)
|
|
$
|
7,074
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Operating
|
2
|
|
|
4
|
|
|
2,035
|
|
|
1,520
|
|
|
—
|
|
|
3,561
|
|
|||||||
|
Vehicle depreciation and lease charges, net
|
—
|
|
|
—
|
|
|
1,681
|
|
|
1,637
|
|
|
(1,625
|
)
|
|
1,693
|
|
|||||||
|
Selling, general and administrative
|
38
|
|
|
9
|
|
|
513
|
|
|
393
|
|
|
—
|
|
|
953
|
|
|||||||
|
Vehicle interest, net
|
—
|
|
|
—
|
|
|
172
|
|
|
232
|
|
|
(167
|
)
|
|
237
|
|
|||||||
|
Non-vehicle related depreciation and amortization
|
—
|
|
|
1
|
|
|
108
|
|
|
81
|
|
|
—
|
|
|
190
|
|
|||||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Interest expense
|
—
|
|
|
115
|
|
|
2
|
|
|
22
|
|
|
—
|
|
|
139
|
|
||||||
|
|
Intercompany interest expense (income)
|
(9
|
)
|
|
(8
|
)
|
|
20
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
||||||
|
|
Early extinguishment of debt
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||||
|
Transaction-related costs, net
|
—
|
|
|
1
|
|
|
3
|
|
|
14
|
|
|
—
|
|
|
18
|
|
|||||||
|
Restructuring and other related charges
|
—
|
|
|
—
|
|
|
6
|
|
|
8
|
|
|
—
|
|
|
14
|
|
|||||||
Total expenses
|
31
|
|
|
127
|
|
|
4,540
|
|
|
3,904
|
|
|
(1,792
|
)
|
|
6,810
|
|
||||||||
Income (loss) before income taxes and equity in earnings of subsidiaries
|
(31
|
)
|
|
(127
|
)
|
|
(369
|
)
|
|
791
|
|
|
—
|
|
|
264
|
|
||||||||
Provision for (benefit from) income taxes
|
(13
|
)
|
|
(34
|
)
|
|
114
|
|
|
45
|
|
|
—
|
|
|
112
|
|
||||||||
Equity in earnings of subsidiaries
|
170
|
|
|
263
|
|
|
746
|
|
|
—
|
|
|
(1,179
|
)
|
|
—
|
|
||||||||
Net income
|
$
|
152
|
|
|
$
|
170
|
|
|
$
|
263
|
|
|
$
|
746
|
|
|
$
|
(1,179
|
)
|
|
$
|
152
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
$
|
104
|
|
|
$
|
122
|
|
|
$
|
207
|
|
|
$
|
687
|
|
|
$
|
(1,016
|
)
|
|
$
|
104
|
|
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Cash and cash equivalents
|
$
|
1
|
|
|
$
|
13
|
|
|
$
|
1
|
|
|
$
|
600
|
|
|
$
|
—
|
|
|
$
|
615
|
|
|
|
Receivables, net
|
—
|
|
|
—
|
|
|
257
|
|
|
615
|
|
|
—
|
|
|
872
|
|
|||||||
|
Other current assets
|
1
|
|
|
118
|
|
|
125
|
|
|
416
|
|
|
—
|
|
|
660
|
|
|||||||
Total current assets
|
2
|
|
|
131
|
|
|
383
|
|
|
1,631
|
|
|
—
|
|
|
2,147
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property and equipment, net
|
—
|
|
|
223
|
|
|
328
|
|
|
201
|
|
|
—
|
|
|
752
|
|
||||||||
Operating lease right-of-use assets
|
—
|
|
|
707
|
|
|
1,123
|
|
|
535
|
|
|
—
|
|
|
2,365
|
|
||||||||
Deferred income taxes
|
14
|
|
|
1,076
|
|
|
207
|
|
|
63
|
|
|
—
|
|
|
1,360
|
|
||||||||
Goodwill
|
—
|
|
|
—
|
|
|
470
|
|
|
613
|
|
|
—
|
|
|
1,083
|
|
||||||||
Other intangibles, net
|
—
|
|
|
25
|
|
|
474
|
|
|
293
|
|
|
—
|
|
|
792
|
|
||||||||
Other non-current assets
|
49
|
|
|
31
|
|
|
15
|
|
|
126
|
|
|
—
|
|
|
221
|
|
||||||||
Intercompany receivables
|
168
|
|
|
422
|
|
|
2,332
|
|
|
1,315
|
|
|
(4,237
|
)
|
|
—
|
|
||||||||
Investment in subsidiaries
|
323
|
|
|
5,035
|
|
|
3,982
|
|
|
—
|
|
|
(9,340
|
)
|
|
—
|
|
||||||||
Total assets exclusive of assets under vehicle programs
|
556
|
|
|
7,650
|
|
|
9,314
|
|
|
4,777
|
|
|
(13,577
|
)
|
|
8,720
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets under vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Program cash
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|
—
|
|
|
89
|
|
|||||||
|
Vehicles, net
|
—
|
|
|
155
|
|
|
55
|
|
|
12,542
|
|
|
—
|
|
|
12,752
|
|
|||||||
|
Receivables from vehicle manufacturers and other
|
—
|
|
|
3
|
|
|
100
|
|
|
802
|
|
|
—
|
|
|
905
|
|
|||||||
|
Investment in Avis Budget Rental Car Funding (AESOP) LLC-related party
|
—
|
|
|
—
|
|
|
—
|
|
|
642
|
|
|
—
|
|
|
642
|
|
|||||||
|
|
|
—
|
|
|
158
|
|
|
155
|
|
|
14,075
|
|
|
—
|
|
|
14,388
|
|
||||||
Total assets
|
$
|
556
|
|
|
$
|
7,808
|
|
|
$
|
9,469
|
|
|
$
|
18,852
|
|
|
$
|
(13,577
|
)
|
|
$
|
23,108
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and stockholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Accounts payable and other current liabilities
|
$
|
17
|
|
|
$
|
295
|
|
|
$
|
826
|
|
|
$
|
1,057
|
|
|
$
|
—
|
|
|
$
|
2,195
|
|
|
|
Short-term debt and current portion of long-term debt
|
—
|
|
|
92
|
|
|
2
|
|
|
1
|
|
|
—
|
|
|
95
|
|
|||||||
Total current liabilities
|
17
|
|
|
387
|
|
|
828
|
|
|
1,058
|
|
|
—
|
|
|
2,290
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term debt
|
—
|
|
|
2,417
|
|
|
2
|
|
|
969
|
|
|
—
|
|
|
3,388
|
|
||||||||
Long-term operating lease liabilities
|
—
|
|
|
643
|
|
|
941
|
|
|
382
|
|
|
—
|
|
|
1,966
|
|
||||||||
Other non-current liabilities
|
44
|
|
|
106
|
|
|
226
|
|
|
372
|
|
|
—
|
|
|
748
|
|
||||||||
Intercompany payables
|
—
|
|
|
3,813
|
|
|
422
|
|
|
2
|
|
|
(4,237
|
)
|
|
—
|
|
||||||||
Total liabilities exclusive of liabilities under vehicle programs
|
61
|
|
|
7,366
|
|
|
2,419
|
|
|
2,783
|
|
|
(4,237
|
)
|
|
8,392
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities under vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Debt
|
—
|
|
|
91
|
|
|
41
|
|
|
3,590
|
|
|
—
|
|
|
3,722
|
|
|||||||
|
Due to Avis Budget Rental Car Funding (AESOP) LLC-related party
|
—
|
|
|
—
|
|
|
—
|
|
|
7,870
|
|
|
—
|
|
|
7,870
|
|
|||||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
1,874
|
|
|
184
|
|
|
—
|
|
|
2,058
|
|
||||||||
Other
|
—
|
|
|
28
|
|
|
100
|
|
|
443
|
|
|
—
|
|
|
571
|
|
||||||||
|
|
|
—
|
|
|
119
|
|
|
2,015
|
|
|
12,087
|
|
|
—
|
|
|
14,221
|
|
||||||
Total stockholders’ equity
|
495
|
|
|
323
|
|
|
5,035
|
|
|
3,982
|
|
|
(9,340
|
)
|
|
495
|
|
||||||||
Total liabilities and stockholders’ equity
|
$
|
556
|
|
|
$
|
7,808
|
|
|
$
|
9,469
|
|
|
$
|
18,852
|
|
|
$
|
(13,577
|
)
|
|
$
|
23,108
|
|
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Cash and cash equivalents
|
$
|
1
|
|
|
$
|
12
|
|
|
$
|
1
|
|
|
$
|
601
|
|
|
$
|
—
|
|
|
$
|
615
|
|
|
|
Receivables, net
|
—
|
|
|
—
|
|
|
239
|
|
|
716
|
|
|
—
|
|
|
955
|
|
|||||||
|
Other current assets
|
5
|
|
|
112
|
|
|
116
|
|
|
371
|
|
|
—
|
|
|
604
|
|
|||||||
Total current assets
|
6
|
|
|
124
|
|
|
356
|
|
|
1,688
|
|
|
—
|
|
|
2,174
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property and equipment, net
|
—
|
|
|
199
|
|
|
319
|
|
|
218
|
|
|
—
|
|
|
736
|
|
||||||||
Deferred income taxes
|
13
|
|
|
1,015
|
|
|
207
|
|
|
66
|
|
|
—
|
|
|
1,301
|
|
||||||||
Goodwill
|
—
|
|
|
—
|
|
|
471
|
|
|
621
|
|
|
—
|
|
|
1,092
|
|
||||||||
Other intangibles, net
|
—
|
|
|
26
|
|
|
475
|
|
|
324
|
|
|
—
|
|
|
825
|
|
||||||||
Other non-current assets
|
47
|
|
|
39
|
|
|
16
|
|
|
140
|
|
|
—
|
|
|
242
|
|
||||||||
Intercompany receivables
|
159
|
|
|
404
|
|
|
2,104
|
|
|
1,262
|
|
|
(3,929
|
)
|
|
—
|
|
||||||||
Investment in subsidiaries
|
246
|
|
|
4,786
|
|
|
3,852
|
|
|
—
|
|
|
(8,884
|
)
|
|
—
|
|
||||||||
Total assets exclusive of assets under vehicle programs
|
471
|
|
|
6,593
|
|
|
7,800
|
|
|
4,319
|
|
|
(12,813
|
)
|
|
6,370
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets under vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Program cash
|
—
|
|
|
—
|
|
|
—
|
|
|
115
|
|
|
—
|
|
|
115
|
|
|||||||
|
Vehicles, net
|
—
|
|
|
55
|
|
|
54
|
|
|
11,365
|
|
|
—
|
|
|
11,474
|
|
|||||||
|
Receivables from vehicle manufacturers and other
|
—
|
|
|
2
|
|
|
—
|
|
|
629
|
|
|
—
|
|
|
631
|
|
|||||||
|
Investment in Avis Budget Rental Car Funding (AESOP) LLC-related party
|
—
|
|
|
—
|
|
|
—
|
|
|
559
|
|
|
—
|
|
|
559
|
|
|||||||
|
|
|
—
|
|
|
57
|
|
|
54
|
|
|
12,668
|
|
|
—
|
|
|
12,779
|
|
||||||
Total assets
|
$
|
471
|
|
|
$
|
6,650
|
|
|
$
|
7,854
|
|
|
$
|
16,987
|
|
|
$
|
(12,813
|
)
|
|
$
|
19,149
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and stockholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Accounts payable and other current liabilities
|
$
|
16
|
|
|
$
|
246
|
|
|
$
|
582
|
|
|
$
|
849
|
|
|
$
|
—
|
|
|
$
|
1,693
|
|
|
|
Short-term debt and current portion of long-term debt
|
—
|
|
|
18
|
|
|
3
|
|
|
2
|
|
|
—
|
|
|
23
|
|
|||||||
Total current liabilities
|
16
|
|
|
264
|
|
|
585
|
|
|
851
|
|
|
—
|
|
|
1,716
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Long-term debt
|
—
|
|
|
2,501
|
|
|
3
|
|
|
1,024
|
|
|
—
|
|
|
3,528
|
|
||||||||
Other non-current liabilities
|
41
|
|
|
87
|
|
|
257
|
|
|
382
|
|
|
—
|
|
|
767
|
|
||||||||
Intercompany payables
|
—
|
|
|
3,524
|
|
|
404
|
|
|
1
|
|
|
(3,929
|
)
|
|
—
|
|
||||||||
Total liabilities exclusive of liabilities under vehicle programs
|
57
|
|
|
6,376
|
|
|
1,249
|
|
|
2,258
|
|
|
(3,929
|
)
|
|
6,011
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities under vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Debt
|
—
|
|
|
28
|
|
|
49
|
|
|
2,797
|
|
|
—
|
|
|
2,874
|
|
|||||||
|
Due to Avis Budget Rental Car Funding (AESOP) LLC-related party
|
—
|
|
|
—
|
|
|
—
|
|
|
7,358
|
|
|
—
|
|
|
7,358
|
|
|||||||
|
Deferred income taxes
|
—
|
|
|
—
|
|
|
1,770
|
|
|
191
|
|
|
—
|
|
|
1,961
|
|
|||||||
|
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
531
|
|
|
—
|
|
|
531
|
|
|||||||
|
|
|
—
|
|
|
28
|
|
|
1,819
|
|
|
10,877
|
|
|
—
|
|
|
12,724
|
|
||||||
Total stockholders’ equity
|
414
|
|
|
246
|
|
|
4,786
|
|
|
3,852
|
|
|
(8,884
|
)
|
|
414
|
|
||||||||
Total liabilities and stockholders’ equity
|
$
|
471
|
|
|
$
|
6,650
|
|
|
$
|
7,854
|
|
|
$
|
16,987
|
|
|
$
|
(12,813
|
)
|
|
$
|
19,149
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Net cash provided by (used in) operating activities
|
$
|
65
|
|
|
$
|
196
|
|
|
$
|
167
|
|
|
$
|
1,765
|
|
|
$
|
(262
|
)
|
|
$
|
1,931
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property and equipment additions
|
—
|
|
|
(56
|
)
|
|
(74
|
)
|
|
(48
|
)
|
|
—
|
|
|
(178
|
)
|
||||||
Proceeds received on asset sales
|
—
|
|
|
1
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
7
|
|
||||||
Net assets acquired (net of cash acquired)
|
—
|
|
|
(5
|
)
|
|
(12
|
)
|
|
(51
|
)
|
|
—
|
|
|
(68
|
)
|
||||||
Other, net
|
—
|
|
|
(75
|
)
|
|
11
|
|
|
69
|
|
|
75
|
|
|
80
|
|
||||||
Net cash provided by (used in) investing activities exclusive of vehicle programs
|
—
|
|
|
(135
|
)
|
|
(75
|
)
|
|
(24
|
)
|
|
75
|
|
|
(159
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment in vehicles
|
—
|
|
|
(42
|
)
|
|
(16
|
)
|
|
(10,563
|
)
|
|
—
|
|
|
(10,621
|
)
|
||||||
Proceeds received on disposition of vehicles
|
—
|
|
|
34
|
|
|
—
|
|
|
7,792
|
|
|
—
|
|
|
7,826
|
|
||||||
Investment in debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party
|
—
|
|
|
—
|
|
|
—
|
|
|
(221
|
)
|
|
—
|
|
|
(221
|
)
|
||||||
Proceeds from debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party
|
—
|
|
|
—
|
|
|
—
|
|
|
137
|
|
|
—
|
|
|
137
|
|
||||||
|
—
|
|
|
(8
|
)
|
|
(16
|
)
|
|
(2,855
|
)
|
|
—
|
|
|
(2,879
|
)
|
||||||
Net cash provided by (used in) investing activities
|
—
|
|
|
(143
|
)
|
|
(91
|
)
|
|
(2,879
|
)
|
|
75
|
|
|
(3,038
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from long-term borrowings
|
—
|
|
|
400
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
402
|
|
||||||
Payments on long-term borrowings
|
—
|
|
|
(420
|
)
|
|
(2
|
)
|
|
(5
|
)
|
|
—
|
|
|
(427
|
)
|
||||||
Repurchases of common stock
|
(65
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(65
|
)
|
||||||
Debt financing fees
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
||||||
Other, net
|
—
|
|
|
(59
|
)
|
|
(64
|
)
|
|
(64
|
)
|
|
187
|
|
|
—
|
|
||||||
Net cash provided by (used in) financing activities exclusive of vehicle programs
|
(65
|
)
|
|
(85
|
)
|
|
(66
|
)
|
|
(67
|
)
|
|
187
|
|
|
(96
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from borrowings
|
—
|
|
|
38
|
|
|
—
|
|
|
16,004
|
|
|
—
|
|
|
16,042
|
|
||||||
Payments on borrowings
|
—
|
|
|
(5
|
)
|
|
(10
|
)
|
|
(14,823
|
)
|
|
—
|
|
|
(14,838
|
)
|
||||||
Debt financing fees
|
—
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
(18
|
)
|
||||||
|
—
|
|
|
33
|
|
|
(10
|
)
|
|
1,163
|
|
|
—
|
|
|
1,186
|
|
||||||
Net cash provided by (used in) financing activities
|
(65
|
)
|
|
(52
|
)
|
|
(76
|
)
|
|
1,096
|
|
|
187
|
|
|
1,090
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(10
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net increase (decrease) in cash and cash equivalents, program and restricted cash
|
—
|
|
|
1
|
|
|
—
|
|
|
(28
|
)
|
|
—
|
|
|
(27
|
)
|
||||||
Cash and cash equivalents, program and restricted cash, beginning of period
|
1
|
|
|
12
|
|
|
1
|
|
|
721
|
|
|
—
|
|
|
735
|
|
||||||
Cash and cash equivalents, program and restricted cash, end of period
|
$
|
1
|
|
|
$
|
13
|
|
|
$
|
1
|
|
|
$
|
693
|
|
|
$
|
—
|
|
|
$
|
708
|
|
|
Parent
|
|
Subsidiary
Issuers
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||||
Net cash provided by (used-in) operating activities
|
$
|
139
|
|
|
$
|
202
|
|
|
$
|
88
|
|
|
$
|
1,785
|
|
|
$
|
(119
|
)
|
|
$
|
2,095
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Property and equipment additions
|
—
|
|
|
(45
|
)
|
|
(60
|
)
|
|
(52
|
)
|
|
—
|
|
|
(157
|
)
|
||||||
Proceeds received on asset sales
|
—
|
|
|
2
|
|
|
2
|
|
|
5
|
|
|
—
|
|
|
9
|
|
||||||
Net assets acquired (net of cash acquired)
|
—
|
|
|
(3
|
)
|
|
(5
|
)
|
|
(56
|
)
|
|
—
|
|
|
(64
|
)
|
||||||
Other, net
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
(44
|
)
|
||||||
Net cash provided by (used in) investing activities exclusive of vehicle programs
|
—
|
|
|
(54
|
)
|
|
(63
|
)
|
|
(139
|
)
|
|
—
|
|
|
(256
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Investment in vehicles
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(10,075
|
)
|
|
—
|
|
|
(10,079
|
)
|
||||||
Proceeds received on disposition of vehicles
|
—
|
|
|
33
|
|
|
—
|
|
|
6,719
|
|
|
—
|
|
|
6,752
|
|
||||||
Investment in debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party
|
—
|
|
|
—
|
|
|
—
|
|
|
(116
|
)
|
|
—
|
|
|
(116
|
)
|
||||||
Proceeds from debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
22
|
|
||||||
|
—
|
|
|
33
|
|
|
(4
|
)
|
|
(3,450
|
)
|
|
—
|
|
|
(3,421
|
)
|
||||||
Net cash provided by (used in) investing activities
|
—
|
|
|
(21
|
)
|
|
(67
|
)
|
|
(3,589
|
)
|
|
—
|
|
|
(3,677
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financing activities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from long-term borrowings
|
—
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
81
|
|
||||||
Payments on long-term borrowings
|
—
|
|
|
(97
|
)
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(99
|
)
|
||||||
Net change in short-term borrowings
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
||||||
Debt financing fees
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||||
Repurchases of common stock
|
(143
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(143
|
)
|
||||||
Other, net
|
3
|
|
|
(95
|
)
|
|
(12
|
)
|
|
(12
|
)
|
|
119
|
|
|
3
|
|
||||||
Net cash provided by (used in) financing activities exclusive of vehicle programs
|
(140
|
)
|
|
(120
|
)
|
|
(14
|
)
|
|
(16
|
)
|
|
119
|
|
|
(171
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Vehicle programs:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Proceeds from borrowings
|
—
|
|
|
—
|
|
|
—
|
|
|
13,371
|
|
|
—
|
|
|
13,371
|
|
||||||
Payments on borrowings
|
—
|
|
|
(2
|
)
|
|
(7
|
)
|
|
(11,718
|
)
|
|
—
|
|
|
(11,727
|
)
|
||||||
Debt financing fees
|
—
|
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
(19
|
)
|
||||||
|
—
|
|
|
(2
|
)
|
|
(7
|
)
|
|
1,634
|
|
|
—
|
|
|
1,625
|
|
||||||
Net cash provided by (used in) financing activities
|
(140
|
)
|
|
(122
|
)
|
|
(21
|
)
|
|
1,618
|
|
|
119
|
|
|
1,454
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net increase (decrease) in cash and cash equivalents, program and restricted cash
|
(1
|
)
|
|
59
|
|
|
—
|
|
|
(191
|
)
|
|
—
|
|
|
(133
|
)
|
||||||
Cash and cash equivalents, program and restricted cash, beginning of period
|
4
|
|
|
14
|
|
|
—
|
|
|
883
|
|
|
—
|
|
|
901
|
|
||||||
Cash and cash equivalents, program and restricted cash, end of period
|
$
|
3
|
|
|
$
|
73
|
|
|
$
|
—
|
|
|
$
|
692
|
|
|
$
|
—
|
|
|
$
|
768
|
|
19.
|
Subsequent Event
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
OVERVIEW
|
•
|
time & mileage fees charged to our customers for vehicle rentals;
|
•
|
sales of loss damage waivers and insurance and other supplemental items in conjunction with vehicle rentals; and
|
•
|
payments from our customers with respect to certain operating expenses we incur, including gasoline, vehicle licensing fees and concession fees, which provide the right to operate at airports and other locations.
|
•
|
Our revenues totaled $7.0 billion and decreased 1% compared to the similar period in 2018, primarily due to a 2% negative impact from currency exchange rate movements.
|
•
|
Our net income was $160 million, representing an $8 million year-over-year improvement in earnings, and our Adjusted EBITDA was $645 million, representing a $6 million year-over-year increase, primarily due to Americas’ lower per-unit fleet costs, partially offset by lower revenues, higher salaries, wages and related benefits and higher interest rates.
|
•
|
We repurchased $59 million of our common stock, reducing our shares outstanding by approximately 2.1 million shares, or 3%.
|
•
|
We acquired various licensees primarily in North America.
|
|
|
|
|
Three Months Ended
September 30, |
|
|
|
|
|||||||||
|
|
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Revenues
|
$
|
2,753
|
|
|
$
|
2,778
|
|
|
$
|
(25
|
)
|
|
(1
|
%)
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Expenses
|
|
|
|
|
|
|
|
||||||||||
|
Operating
|
1,291
|
|
|
1,294
|
|
|
(3
|
)
|
|
0
|
%
|
|||||
|
Vehicle depreciation and lease charges, net
|
551
|
|
|
587
|
|
|
(36
|
)
|
|
(6
|
%)
|
|||||
|
Selling, general and administrative
|
350
|
|
|
336
|
|
|
14
|
|
|
4
|
%
|
|||||
|
Vehicle interest, net
|
90
|
|
|
85
|
|
|
5
|
|
|
6
|
%
|
|||||
|
Non-vehicle related depreciation and amortization
|
62
|
|
|
62
|
|
|
—
|
|
|
0
|
%
|
|||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|||||||||
|
Interest expense
|
49
|
|
|
44
|
|
|
5
|
|
|
11
|
%
|
|||||
|
Early extinguishment of debt
|
10
|
|
|
—
|
|
|
10
|
|
|
n/m
|
|
|||||
|
Restructuring and other related charges
|
22
|
|
|
4
|
|
|
18
|
|
|
n/m
|
|
|||||
|
Transaction-related costs, net
|
—
|
|
|
11
|
|
|
(11
|
)
|
|
n/m
|
|
|||||
Total expenses
|
2,425
|
|
|
2,423
|
|
|
2
|
|
|
0
|
%
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Income before income taxes
|
328
|
|
|
355
|
|
|
(27
|
)
|
|
(8
|
%)
|
||||||
Provision for income taxes
|
139
|
|
|
142
|
|
|
(3
|
)
|
|
(2
|
%)
|
||||||
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
189
|
|
|
$
|
213
|
|
|
$
|
(24
|
)
|
|
(11
|
%)
|
n/m
|
Not meaningful.
|
|
|
|
|
Three Months Ended September 30,
|
||||||||||||||
|
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
|
|
Revenues
|
|
Adjusted EBITDA
|
|
Revenues
|
|
Adjusted EBITDA
|
||||||||
Americas
|
$
|
1,868
|
|
|
$
|
321
|
|
|
$
|
1,844
|
|
|
$
|
313
|
|
|||
International
|
885
|
|
|
169
|
|
|
934
|
|
|
178
|
|
|||||||
Corporate and Other (a)
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
(15
|
)
|
|||||||
|
Total Company
|
$
|
2,753
|
|
|
$
|
471
|
|
|
$
|
2,778
|
|
|
$
|
476
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
Reconciliation to Adjusted EBITDA
|
|
|||||||||||||
|
|
|
|
|
|
|
|
2019
|
|
2018
|
||||||||
Net income
|
|
$
|
189
|
|
|
$
|
213
|
|
||||||||||
Provision for income taxes
|
|
139
|
|
|
142
|
|
||||||||||||
Income before income taxes
|
|
328
|
|
|
355
|
|
||||||||||||
|
|
|
|
|
|
|||||||||||||
Add:
|
Non-vehicle related depreciation and amortization
|
|
62
|
|
|
62
|
|
|||||||||||
|
|
Interest expense related to corporate debt, net:
|
|
|
|
|
||||||||||||
|
|
Interest expense
|
|
49
|
|
|
44
|
|
||||||||||
|
|
Early extinguishment of debt
|
|
10
|
|
|
—
|
|
||||||||||
|
|
Restructuring and other related charges
|
|
22
|
|
|
4
|
|
||||||||||
|
|
Transaction-related costs, net (b)
|
|
—
|
|
|
11
|
|
||||||||||
Adjusted EBITDA
|
|
$
|
471
|
|
|
$
|
476
|
|
(a)
|
Includes unallocated corporate overhead which is not attributable to a particular segment.
|
(b)
|
Primarily comprised of acquisition- and integration-related expenses.
|
|
|
Three Months Ended
September 30, |
|
|
|||||||
|
|
2019
|
|
2018
|
|
% Change
|
|||||
Revenues
|
|
$
|
1,868
|
|
|
$
|
1,844
|
|
|
1
|
%
|
Adjusted EBITDA
|
|
321
|
|
|
313
|
|
|
3
|
%
|
|
|
Three Months Ended
September 30, |
|
|
|||||||
|
|
2019
|
|
2018
|
|
% Change
|
|||||
Revenues
|
|
$
|
885
|
|
|
$
|
934
|
|
|
(5
|
%)
|
Adjusted EBITDA
|
|
169
|
|
|
178
|
|
|
(5
|
%)
|
|
|
|
|
Nine Months Ended
September 30, |
|
|
|
|
|||||||||
|
|
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Revenues
|
$
|
7,010
|
|
|
$
|
7,074
|
|
|
$
|
(64
|
)
|
|
(1
|
%)
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Expenses
|
|
|
|
|
|
|
|
||||||||||
|
Operating
|
3,534
|
|
|
3,561
|
|
|
(27
|
)
|
|
(1
|
%)
|
|||||
|
Vehicle depreciation and lease charges, net
|
1,579
|
|
|
1,693
|
|
|
(114
|
)
|
|
(7
|
%)
|
|||||
|
Selling, general and administrative
|
947
|
|
|
953
|
|
|
(6
|
)
|
|
(1
|
%)
|
|||||
|
Vehicle interest, net
|
261
|
|
|
237
|
|
|
24
|
|
|
10
|
%
|
|||||
|
Non-vehicle related depreciation and amortization
|
195
|
|
|
190
|
|
|
5
|
|
|
3
|
%
|
|||||
|
Interest expense related to corporate debt, net:
|
|
|
|
|
|
|
|
|
|
|||||||
|
Interest expense
|
139
|
|
|
139
|
|
|
—
|
|
|
0
|
%
|
|||||
|
Early extinguishment of debt
|
10
|
|
|
5
|
|
|
5
|
|
|
100
|
%
|
|||||
|
Restructuring and other related charges
|
66
|
|
|
14
|
|
|
52
|
|
|
n/m
|
|
|||||
|
Transaction-related costs, net
|
6
|
|
|
18
|
|
|
(12
|
)
|
|
(67
|
%)
|
|||||
Total expenses
|
6,737
|
|
|
6,810
|
|
|
(73
|
)
|
|
(1
|
%)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Income before income taxes
|
273
|
|
|
264
|
|
|
9
|
|
|
3
|
%
|
||||||
Provision for income taxes
|
113
|
|
|
112
|
|
|
1
|
|
|
1
|
%
|
||||||
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
160
|
|
|
$
|
152
|
|
|
$
|
8
|
|
|
5
|
%
|
n/m
|
Not meaningful.
|
|
|
|
|
Nine Months Ended September 30,
|
||||||||||||||
|
|
|
|
2019
|
|
2018
|
||||||||||||
|
|
|
|
Revenues
|
|
Adjusted EBITDA
|
|
Revenues
|
|
Adjusted EBITDA
|
||||||||
Americas
|
$
|
4,822
|
|
|
$
|
508
|
|
|
$
|
4,782
|
|
|
$
|
435
|
|
|||
International
|
2,188
|
|
|
187
|
|
|
2,292
|
|
|
252
|
|
|||||||
Corporate and Other (a)
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
(48
|
)
|
|||||||
|
Total Company
|
$
|
7,010
|
|
|
$
|
645
|
|
|
$
|
7,074
|
|
|
$
|
639
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
Reconciliation to Adjusted EBITDA
|
|
|||||||||||||
|
|
|
|
|
|
|
|
2019
|
|
2018
|
||||||||
Net income
|
|
$
|
160
|
|
|
$
|
152
|
|
||||||||||
Provision for income taxes
|
|
113
|
|
|
112
|
|
||||||||||||
Income before income taxes
|
|
273
|
|
|
264
|
|
||||||||||||
|
|
|
|
|
|
|||||||||||||
Add:
|
Non-vehicle related depreciation and amortization
|
|
195
|
|
|
190
|
|
|||||||||||
|
|
Interest expense related to corporate debt, net
|
|
|
|
|
||||||||||||
|
|
Interest expense
|
|
139
|
|
|
139
|
|
||||||||||
|
|
Early extinguishment of debt
|
|
10
|
|
|
5
|
|
||||||||||
|
|
Restructuring and other related charges
|
|
66
|
|
|
14
|
|
||||||||||
|
|
Transaction-related costs, net (b)
|
|
6
|
|
|
18
|
|
||||||||||
|
|
Non-operational charges related to shareholder activist activity (c)
|
|
—
|
|
|
9
|
|
||||||||||
|
|
Gain on sale of equity method investment in Anji (d)
|
|
(44
|
)
|
|
—
|
|
||||||||||
Adjusted EBITDA
|
|
$
|
645
|
|
|
$
|
639
|
|
(a)
|
Includes unallocated corporate overhead which is not attributable to a particular segment.
|
(b)
|
Primarily comprised of acquisition- and integration-related expenses.
|
(c)
|
Reported within selling, general and administrative expenses in our consolidated results of operations.
|
(d)
|
Reported within operating expenses in our consolidated results of operations (see Note 1 to our Consolidated Condensed Financial Statements).
|
|
|
Nine Months Ended
September 30, |
|
|
|||||||
|
|
2019
|
|
2018
|
|
% Change
|
|||||
Revenue
|
|
$
|
4,822
|
|
|
$
|
4,782
|
|
|
1
|
%
|
Adjusted EBITDA
|
|
508
|
|
|
435
|
|
|
17
|
%
|
|
|
Nine Months Ended
September 30, |
|
|
|||||||
|
|
2019
|
|
2018
|
|
% Change
|
|||||
Revenue
|
|
$
|
2,188
|
|
|
$
|
2,292
|
|
|
(5
|
%)
|
Adjusted EBITDA
|
|
187
|
|
|
252
|
|
|
(26
|
%)
|
|
|
September 30,
2019 |
|
December 31, 2018
|
|
Change
|
||||||
Total assets exclusive of assets under vehicle programs
|
|
$
|
8,720
|
|
|
$
|
6,370
|
|
|
$
|
2,350
|
|
Total liabilities exclusive of liabilities under vehicle programs
|
|
8,392
|
|
|
6,011
|
|
|
2,381
|
|
|||
Assets under vehicle programs
|
|
14,388
|
|
|
12,779
|
|
|
1,609
|
|
|||
Liabilities under vehicle programs
|
|
14,221
|
|
|
12,724
|
|
|
1,497
|
|
|||
Stockholders’ equity
|
|
495
|
|
|
414
|
|
|
81
|
|
|
|
Nine Months Ended September 30,
|
||||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
Cash provided by (used in):
|
|
|
|
|
|
|||||||
|
Operating activities
|
$
|
1,931
|
|
|
$
|
2,095
|
|
|
$
|
(164
|
)
|
|
Investing activities
|
(3,038
|
)
|
|
(3,677
|
)
|
|
639
|
|
|||
|
Financing activities
|
1,090
|
|
|
1,454
|
|
|
(364
|
)
|
|||
Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash
|
(10
|
)
|
|
(5
|
)
|
|
(5
|
)
|
||||
Net decrease in cash and cash equivalents, program and restricted cash
|
(27
|
)
|
|
(133
|
)
|
|
106
|
|
||||
Cash and cash equivalents, program and restricted cash, beginning of period
|
735
|
|
|
901
|
|
|
(166
|
)
|
||||
Cash and cash equivalents, program and restricted cash, end of period
|
$
|
708
|
|
|
$
|
768
|
|
|
$
|
(60
|
)
|
Item 3.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item 4.
|
Controls and Procedures
|
(a)
|
Disclosure Controls and Procedures. Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, our management conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of September 30, 2019.
|
(b)
|
Changes in Internal Control Over Financial Reporting. During the fiscal quarter to which this report relates, there has been no change in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
Total Number of Shares Purchased(a)
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs
|
||||||
July 2019
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
150,501,899
|
|
August 2019
|
1,480,395
|
|
|
26.68
|
|
|
1,480,395
|
|
|
210,987,586
|
|
||
September 2019
|
660,872
|
|
|
29.18
|
|
|
660,872
|
|
|
191,703,211
|
|
||
Total
|
2,141,267
|
|
|
$
|
27.45
|
|
|
2,141,267
|
|
|
$
|
191,703,211
|
|
(a)
|
Excludes, for the three months ended September 30, 2019, 50,749 shares which were withheld by the Company to satisfy employees’ income tax liabilities attributable to the vesting of restricted stock unit awards.
|
Item 6.
|
Exhibits
|
|
|
|
|
AVIS BUDGET GROUP, INC.
|
|
|
|
||
Date:
|
November 1, 2019
|
|
|
|
|
|
|
|
/s/ Cathleen DeGenova
|
|
|
|
|
Cathleen DeGenova
|
|
|
|
|
Vice President and
|
|
|
|
|
Chief Accounting Officer
|
Exhibit No.
|
Description
|
10.1
|
|
10.2
|
|
10.3
|
|
31.1
|
|
31.2
|
|
32
|
|
101.INS
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
101.SCH
|
XBRL Taxonomy Extension Schema.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase.
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase.
|
1.
|
You will not engage in any activity that competes with or adversely affects the Company or any of its subsidiaries, nor will you begin to organize or develop any competing entity (or assist anyone else in doing so).
|
2.
|
You will not disclose at any time (except for business purposes on behalf of the Company or any of its subsidiaries and in accordance with corporate policy) any confidential or proprietary material of the Company or any of its subsidiaries, which material shall include, but is not limited to, the names and addresses of customers, customer contacts, contracts, bidding information, business strategies, pricing information, and the Company’s policies and procedures.
|
3.
|
All documents (paper or electronic) and other information related in any way to the Company or any of its subsidiaries shall be the property of the respective applicable entity, and will be returned to the applicable entity upon the end of your employment with the Company.
|
1.
|
the last sentence of the “Duration” section shall be amended to read as follows: “Following expiration of the Initial Term, the Assignment will continue until January 31, 2020 (the period from the expiration of the Initial Term until January 31, 2020 being the “Extended Term”);
|
2.
|
the first sentence of the section entitled “Fees Associated with Transition and Advisory Services” shall be amended to add the following language at the end of such sentence: “provided, however, that from September 19, 2019 through the end of the Extended Term, such base salary shall be reduced by 50%”; and
|
3.
|
the second sentence of the “Termination” section shall be amended to include the following language at the end of such sentence: “provided, however, that if at any time following September 19, 2019 the Company terminates the Assignment or the Extended Term for any reason or no reason, the Company shall not be required to pay any amount that has not been earned under the first sentence of the section entitled “Fees Associated with Transition and Advisory Services.”
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Avis Budget Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Larry D. De Shon
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Avis Budget Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ John F. North, III
|
Executive Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ LARRY D. DE SHON
|
Larry D. De Shon
|
President and Chief Executive Officer
|
November 1, 2019
|
|
/s/ JOHN F. NORTH, III
|
John F. North, III
|
Executive Vice President and Chief Financial Officer
|
November 1, 2019
|