|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
36-4215970
|
||
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
||
|
|
|
|
|
500 West Madison Street,
|
Suite 2800
|
|
|
|
Chicago
|
Illinois
|
|
|
60661
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of Each Class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
|
|
Common Stock, par value $.01 per share
|
|
LKQ
|
|
NASDAQ
|
Global Select Market
|
Large Accelerated Filer
|
☒
|
Accelerated Filer
|
☐
|
Non-accelerated Filer
|
☐ (Do not check if a smaller reporting company)
|
Smaller Reporting Company
|
☐
|
Emerging Growth Company
|
☐
|
|
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Income
(In thousands, except per share data)
|
|||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
$
|
3,248,173
|
|
|
$
|
3,030,751
|
|
|
$
|
6,348,476
|
|
|
$
|
5,751,515
|
|
Cost of goods sold
|
2,000,986
|
|
|
1,868,872
|
|
|
3,893,025
|
|
|
3,535,665
|
|
||||
Gross margin
|
1,247,187
|
|
|
1,161,879
|
|
|
2,455,451
|
|
|
2,215,850
|
|
||||
Selling, general and administrative expenses
|
898,368
|
|
|
826,044
|
|
|
1,794,900
|
|
|
1,592,935
|
|
||||
Restructuring and acquisition related expenses
|
8,377
|
|
|
15,878
|
|
|
11,684
|
|
|
19,932
|
|
||||
Impairment of net assets held for sale
|
33,497
|
|
|
—
|
|
|
48,520
|
|
|
—
|
|
||||
Depreciation and amortization
|
70,834
|
|
|
63,163
|
|
|
141,836
|
|
|
119,621
|
|
||||
Operating income
|
236,111
|
|
|
256,794
|
|
|
458,511
|
|
|
483,362
|
|
||||
Other expense (income):
|
|
|
|
|
|
|
|
||||||||
Interest expense, net of interest income
|
35,884
|
|
|
38,272
|
|
|
71,973
|
|
|
66,787
|
|
||||
Other (income) expense, net
|
(5,733
|
)
|
|
427
|
|
|
(9,584
|
)
|
|
(2,455
|
)
|
||||
Total other expense, net
|
30,151
|
|
|
38,699
|
|
|
62,389
|
|
|
64,332
|
|
||||
Income from continuing operations before provision for income taxes
|
205,960
|
|
|
218,095
|
|
|
396,122
|
|
|
419,030
|
|
||||
Provision for income taxes
|
55,825
|
|
|
60,775
|
|
|
107,375
|
|
|
110,359
|
|
||||
Equity in earnings (losses) of unconsolidated subsidiaries
|
1,572
|
|
|
546
|
|
|
(37,977
|
)
|
|
1,958
|
|
||||
Income from continuing operations
|
151,707
|
|
|
157,866
|
|
|
250,770
|
|
|
310,629
|
|
||||
Net income from discontinued operations
|
398
|
|
|
—
|
|
|
398
|
|
|
—
|
|
||||
Net income
|
152,105
|
|
|
157,866
|
|
|
251,168
|
|
|
310,629
|
|
||||
Less: net income attributable to continuing noncontrolling interest
|
1,352
|
|
|
859
|
|
|
2,367
|
|
|
662
|
|
||||
Less: net income attributable to discontinued noncontrolling interest
|
192
|
|
|
—
|
|
|
192
|
|
|
—
|
|
||||
Net income attributable to LKQ stockholders
|
$
|
150,561
|
|
|
$
|
157,007
|
|
|
$
|
248,609
|
|
|
$
|
309,967
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share: (1)
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
0.49
|
|
|
$
|
0.51
|
|
|
$
|
0.80
|
|
|
$
|
1.00
|
|
Net income from discontinued operations
|
0.00
|
|
|
—
|
|
|
0.00
|
|
|
—
|
|
||||
Net income
|
0.49
|
|
|
0.51
|
|
|
0.80
|
|
|
1.00
|
|
||||
Less: net income attributable to continuing noncontrolling interest
|
0.00
|
|
|
0.00
|
|
|
0.01
|
|
|
0.00
|
|
||||
Less: net income attributable to discontinued noncontrolling interest
|
0.00
|
|
|
—
|
|
|
0.00
|
|
|
—
|
|
||||
Net income attributable to LKQ stockholders
|
$
|
0.48
|
|
|
$
|
0.50
|
|
|
$
|
0.79
|
|
|
$
|
1.00
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share: (1)
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
0.49
|
|
|
$
|
0.50
|
|
|
$
|
0.80
|
|
|
$
|
0.99
|
|
Net income from discontinued operations
|
0.00
|
|
|
—
|
|
|
0.00
|
|
|
—
|
|
||||
Net income
|
0.49
|
|
|
0.50
|
|
|
0.80
|
|
|
0.99
|
|
||||
Less: net income attributable to continuing noncontrolling interest
|
0.00
|
|
|
0.00
|
|
|
0.01
|
|
|
0.00
|
|
||||
Less: net income attributable to discontinued noncontrolling interest
|
0.00
|
|
|
—
|
|
|
0.00
|
|
|
—
|
|
||||
Net income attributable to LKQ stockholders
|
$
|
0.48
|
|
|
$
|
0.50
|
|
|
$
|
0.79
|
|
|
$
|
0.99
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Comprehensive Income
(In thousands)
|
|||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
152,105
|
|
|
$
|
157,866
|
|
|
$
|
251,168
|
|
|
$
|
310,629
|
|
Less: net income attributable to continuing noncontrolling interest
|
1,352
|
|
|
859
|
|
|
2,367
|
|
|
662
|
|
||||
Less: net income attributable to discontinued noncontrolling interest
|
192
|
|
|
—
|
|
|
192
|
|
|
—
|
|
||||
Net income attributable to LKQ stockholders
|
150,561
|
|
|
157,007
|
|
|
248,609
|
|
|
309,967
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation, net of tax
|
5,602
|
|
|
(105,164
|
)
|
|
(4,293
|
)
|
|
(56,679
|
)
|
||||
Net change in unrealized gains/losses on cash flow hedges, net of tax
|
(5,650
|
)
|
|
2,406
|
|
|
(8,387
|
)
|
|
5,660
|
|
||||
Net change in unrealized gains/losses on pension plans, net of tax
|
28
|
|
|
(807
|
)
|
|
219
|
|
|
(1,428
|
)
|
||||
Net change in other comprehensive income (loss) from unconsolidated subsidiaries
|
2,321
|
|
|
2,122
|
|
|
(1,142
|
)
|
|
1,517
|
|
||||
Other comprehensive income (loss)
|
2,301
|
|
|
(101,443
|
)
|
|
(13,603
|
)
|
|
(50,930
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive income
|
154,406
|
|
|
56,423
|
|
|
237,565
|
|
|
259,699
|
|
||||
Less: comprehensive income attributable to continuing noncontrolling interest
|
1,352
|
|
|
859
|
|
|
2,367
|
|
|
662
|
|
||||
Less: comprehensive income attributable to discontinued noncontrolling interest
|
192
|
|
|
—
|
|
|
192
|
|
|
—
|
|
||||
Comprehensive income attributable to LKQ stockholders
|
$
|
152,862
|
|
|
$
|
55,564
|
|
|
$
|
235,006
|
|
|
$
|
259,037
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)
|
|||||||
|
June 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
375,967
|
|
|
$
|
331,761
|
|
Receivables, net
|
1,285,802
|
|
|
1,154,083
|
|
||
Inventories
|
2,650,138
|
|
|
2,836,075
|
|
||
Prepaid expenses and other current assets
|
319,942
|
|
|
199,030
|
|
||
Total current assets
|
4,631,849
|
|
|
4,520,949
|
|
||
Property, plant and equipment, net
|
1,206,690
|
|
|
1,220,162
|
|
||
Operating lease assets, net
|
1,294,541
|
|
|
—
|
|
||
Intangible assets:
|
|
|
|
||||
Goodwill
|
4,409,925
|
|
|
4,381,458
|
|
||
Other intangibles, net
|
880,123
|
|
|
928,752
|
|
||
Equity method investments
|
133,154
|
|
|
179,169
|
|
||
Other noncurrent assets
|
147,954
|
|
|
162,912
|
|
||
Total assets
|
$
|
12,704,236
|
|
|
$
|
11,393,402
|
|
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
1,031,952
|
|
|
$
|
942,398
|
|
Accrued expenses:
|
|
|
|
||||
Accrued payroll-related liabilities
|
171,650
|
|
|
172,005
|
|
||
Refund liability
|
106,612
|
|
|
104,585
|
|
||
Other accrued expenses
|
309,734
|
|
|
288,425
|
|
||
Other current liabilities
|
134,855
|
|
|
61,109
|
|
||
Current portion of operating lease liabilities
|
219,502
|
|
|
—
|
|
||
Current portion of long-term obligations
|
132,641
|
|
|
121,826
|
|
||
Total current liabilities
|
2,106,946
|
|
|
1,690,348
|
|
||
Long-term operating lease liabilities, excluding current portion
|
1,122,276
|
|
|
—
|
|
||
Long-term obligations, excluding current portion
|
3,919,902
|
|
|
4,188,674
|
|
||
Deferred income taxes
|
303,179
|
|
|
311,434
|
|
||
Other noncurrent liabilities
|
342,185
|
|
|
364,194
|
|
||
Commitments and contingencies
|
|
|
|
|
|||
Stockholders' equity:
|
|
|
|
||||
Common stock, $0.01 par value, 1,000,000,000 shares authorized, 319,010,278 shares issued and 309,695,052 shares outstanding at June 30, 2019; 318,417,821 shares issued and 316,146,114 shares outstanding at December 31, 2018
|
3,190
|
|
|
3,184
|
|
||
Additional paid-in capital
|
1,429,129
|
|
|
1,415,188
|
|
||
Retained earnings
|
3,847,485
|
|
|
3,598,876
|
|
||
Accumulated other comprehensive loss
|
(188,553
|
)
|
|
(174,950
|
)
|
||
Treasury stock, at cost; 9,315,226 shares at June 30, 2019 and 2,271,707 shares at December 31, 2018
|
(250,762
|
)
|
|
(60,000
|
)
|
||
Total Company stockholders' equity
|
4,840,489
|
|
|
4,782,298
|
|
||
Noncontrolling interest
|
69,259
|
|
|
56,454
|
|
||
Total stockholders' equity
|
4,909,748
|
|
|
4,838,752
|
|
||
Total liabilities and stockholders' equity
|
$
|
12,704,236
|
|
|
$
|
11,393,402
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Stockholders' Equity
(In thousands)
|
|||||||||||||||||||||||||||||||||
|
LKQ Stockholders
|
|
|
|
|
||||||||||||||||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-In Capital
|
|
Retained Earnings
|
|
Accumulated
Other
Comprehensive (Loss) Income
|
|
Noncontrolling Interest
|
|
Total Stockholders' Equity
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
||||||||||||||||||||||||||
BALANCE, April 1, 2019
|
318,889
|
|
|
$
|
3,189
|
|
|
(4,915
|
)
|
|
$
|
(130,462
|
)
|
|
$
|
1,420,685
|
|
|
$
|
3,696,924
|
|
|
$
|
(190,854
|
)
|
|
$
|
57,292
|
|
|
$
|
4,856,774
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
150,561
|
|
|
—
|
|
|
1,544
|
|
|
152,105
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,301
|
|
|
—
|
|
|
2,301
|
|
|||||||
Purchase of treasury stock
|
—
|
|
|
—
|
|
|
(4,400
|
)
|
|
(120,300
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(120,300
|
)
|
|||||||
Vesting of restricted stock units, net of shares withheld for employee tax
|
68
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(78
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(77
|
)
|
|||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,986
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,986
|
|
|||||||
Exercise of stock options
|
53
|
|
|
0
|
|
|
—
|
|
|
—
|
|
|
536
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
536
|
|
|||||||
Capital contributions from, net of dividends declared to, noncontrolling interest shareholder
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
162
|
|
|
162
|
|
|||||||
Acquired noncontrolling interest (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,261
|
|
|
10,261
|
|
|||||||
BALANCE, June 30, 2019
|
319,010
|
|
|
$
|
3,190
|
|
|
(9,315
|
)
|
|
$
|
(250,762
|
)
|
|
$
|
1,429,129
|
|
|
$
|
3,847,485
|
|
|
$
|
(188,553
|
)
|
|
$
|
69,259
|
|
|
$
|
4,909,748
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Stockholders' Equity
(In thousands)
|
||||||||||||||||||||||||||
|
LKQ Stockholders
|
|
|
|
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive (Loss) Income
|
|
Noncontrolling Interest
|
|
Total Stockholders' Equity
|
|||||||||||||||
|
Shares
Issued
|
|
Amount
|
|
||||||||||||||||||||||
BALANCE, April 1, 2018
|
309,631
|
|
|
$
|
3,096
|
|
|
$
|
1,146,391
|
|
|
$
|
3,271,718
|
|
|
$
|
(14,618
|
)
|
|
$
|
12,394
|
|
|
$
|
4,418,981
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
157,007
|
|
|
—
|
|
|
859
|
|
|
157,866
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(101,443
|
)
|
|
—
|
|
|
(101,443
|
)
|
||||||
Stock issued in acquisitions
|
8,056
|
|
|
81
|
|
|
251,253
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
251,334
|
|
||||||
Vesting of restricted stock units, net of shares withheld for employee tax
|
44
|
|
|
—
|
|
|
(381
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(381
|
)
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
5,862
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,862
|
|
||||||
Exercise of stock options
|
95
|
|
|
1
|
|
|
666
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
667
|
|
||||||
Shares withheld for net share settlement of stock option awards
|
(5
|
)
|
|
—
|
|
|
(161
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(161
|
)
|
||||||
Acquired noncontrolling
interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,250
|
|
|
44,250
|
|
||||||
BALANCE, June 30, 2018
|
317,821
|
|
|
$
|
3,178
|
|
|
$
|
1,403,630
|
|
|
$
|
3,428,725
|
|
|
$
|
(116,061
|
)
|
|
$
|
57,503
|
|
|
$
|
4,776,975
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Stockholders' Equity
(In thousands)
|
||||||||||||||||||||||||||
|
LKQ Stockholders
|
|
|
|
|
|||||||||||||||||||||
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive (Loss) Income
|
|
Noncontrolling Interest
|
|
Total Stockholders' Equity
|
|||||||||||||||
|
Shares
Issued
|
|
Amount
|
|
||||||||||||||||||||||
BALANCE, January 1, 2018
|
309,127
|
|
|
$
|
3,091
|
|
|
$
|
1,141,451
|
|
|
$
|
3,124,103
|
|
|
$
|
(70,476
|
)
|
|
$
|
8,484
|
|
|
$
|
4,206,653
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
309,967
|
|
|
—
|
|
|
662
|
|
|
310,629
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(50,930
|
)
|
|
—
|
|
|
(50,930
|
)
|
||||||
Stock issued in acquisitions
|
8,056
|
|
|
81
|
|
|
251,253
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
251,334
|
|
||||||
Vesting of restricted stock units, net of shares withheld for employee tax
|
344
|
|
|
3
|
|
|
(2,780
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,777
|
)
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
11,844
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,844
|
|
||||||
Exercise of stock options
|
321
|
|
|
3
|
|
|
2,919
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,922
|
|
||||||
Shares withheld for net share settlement of stock option awards
|
(27
|
)
|
|
—
|
|
|
(1,057
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,057
|
)
|
||||||
Adoption of ASU 2018-02 (see Note 9)
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,345
|
)
|
|
5,345
|
|
|
—
|
|
|
—
|
|
||||||
Capital contributions from noncontrolling interest shareholder
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,107
|
|
|
4,107
|
|
||||||
Acquired noncontrolling
interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,250
|
|
|
44,250
|
|
||||||
BALANCE, June 30, 2018
|
317,821
|
|
|
$
|
3,178
|
|
|
$
|
1,403,630
|
|
|
$
|
3,428,725
|
|
|
$
|
(116,061
|
)
|
|
$
|
57,503
|
|
|
$
|
4,776,975
|
|
Note 1.
|
Interim Financial Statements
|
|
Year Ended
|
||||||||||
|
December 31, 2018
|
||||||||||
|
Stahlgruber
|
|
Other Acquisitions (1)
|
|
Total
|
||||||
Receivables
|
$
|
144,826
|
|
|
$
|
19,171
|
|
|
$
|
163,997
|
|
Receivable reserves
|
(2,818
|
)
|
|
(918
|
)
|
|
(3,736
|
)
|
|||
Inventories
|
380,238
|
|
|
14,021
|
|
|
394,259
|
|
|||
Prepaid expenses and other current assets
|
10,970
|
|
|
1,851
|
|
|
12,821
|
|
|||
Property, plant and equipment
|
271,292
|
|
|
5,711
|
|
|
277,003
|
|
|||
Goodwill
|
908,253
|
|
|
64,637
|
|
|
972,890
|
|
|||
Other intangibles
|
285,255
|
|
|
35,159
|
|
|
320,414
|
|
|||
Other noncurrent assets
|
16,625
|
|
|
37
|
|
|
16,662
|
|
|||
Deferred income taxes
|
(78,130
|
)
|
|
(5,285
|
)
|
|
(83,415
|
)
|
|||
Current liabilities assumed
|
(346,788
|
)
|
|
(20,116
|
)
|
|
(366,904
|
)
|
|||
Debt assumed
|
(79,925
|
)
|
|
(4,875
|
)
|
|
(84,800
|
)
|
|||
Other noncurrent liabilities assumed (2)
|
(80,824
|
)
|
|
(10,306
|
)
|
|
(91,130
|
)
|
|||
Noncontrolling interest
|
(44,110
|
)
|
|
—
|
|
|
(44,110
|
)
|
|||
Contingent consideration liabilities
|
—
|
|
|
(3,107
|
)
|
|
(3,107
|
)
|
|||
Other purchase price obligations
|
(6,084
|
)
|
|
3,623
|
|
|
(2,461
|
)
|
|||
Stock issued
|
(251,334
|
)
|
|
—
|
|
|
(251,334
|
)
|
|||
Notes issued
|
—
|
|
|
(11,347
|
)
|
|
(11,347
|
)
|
|||
Gains on bargain purchases (3)
|
—
|
|
|
(2,418
|
)
|
|
(2,418
|
)
|
|||
Settlement of other purchase price obligations (non-interest bearing)
|
—
|
|
|
1,711
|
|
|
1,711
|
|
|||
Cash used in acquisitions, net of cash and restricted cash acquired
|
$
|
1,127,446
|
|
|
$
|
87,549
|
|
|
$
|
1,214,995
|
|
(1)
|
The amounts recorded during the year ended December 31, 2018 include a $5 million adjustment to increase other intangibles related to our acquisition of Warn Industries, Inc. in 2017 and $4 million of adjustments to reduce other purchase price obligations related to other 2017 acquisitions.
|
(2)
|
The amount recorded for our acquisition of Stahlgruber includes a $79 million liability for certain pension obligations.
|
(3)
|
The amounts recorded during the year ended December 31, 2018 are due to the gains on bargain purchases related to (i) an acquisition in Europe completed in the second quarter of 2017 as a result of changes in the acquisition date fair value of the consideration, and (ii) three acquisitions in Europe completed during 2018 as a result of changes to our estimates of the fair values of the net assets acquired.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue, as reported
|
$
|
3,248,173
|
|
|
$
|
3,030,751
|
|
|
$
|
6,348,476
|
|
|
$
|
5,751,515
|
|
Revenue of purchased businesses for the period prior to acquisition:
|
|
|
|
|
|
|
|
||||||||
Stahlgruber
|
—
|
|
|
325,871
|
|
|
—
|
|
|
815,405
|
|
||||
Other acquisitions
|
1,417
|
|
|
47,680
|
|
|
16,481
|
|
|
99,837
|
|
||||
Pro forma revenue
|
$
|
3,249,590
|
|
|
$
|
3,404,302
|
|
|
$
|
6,364,957
|
|
|
$
|
6,666,757
|
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations, as reported (1)
|
$
|
151,707
|
|
|
$
|
157,866
|
|
|
$
|
250,770
|
|
|
$
|
310,629
|
|
Income from continuing operations of purchased businesses for the period prior to acquisition, and pro forma purchase accounting adjustments:
|
|
|
|
|
|
|
|
||||||||
Stahlgruber
|
3,042
|
|
|
7,217
|
|
|
6,116
|
|
|
8,490
|
|
||||
Other acquisitions
|
353
|
|
|
1,502
|
|
|
1,990
|
|
|
3,106
|
|
||||
Acquisition related expenses, net of tax (2)
|
100
|
|
|
11,779
|
|
|
324
|
|
|
13,305
|
|
||||
Pro forma income from continuing operations
|
155,202
|
|
|
178,364
|
|
|
259,200
|
|
|
335,530
|
|
||||
Less: Net income attributable to continuing noncontrolling interest, as reported
|
1,352
|
|
|
859
|
|
|
2,367
|
|
|
662
|
|
||||
Less: Pro forma net income attributable to continuing noncontrolling interest
|
—
|
|
|
2,271
|
|
|
—
|
|
|
2,799
|
|
||||
Pro forma net income from continuing operations attributable to LKQ stockholders (3)
|
$
|
153,850
|
|
|
$
|
175,234
|
|
|
$
|
256,833
|
|
|
$
|
332,069
|
|
(1)
|
2018 amounts include interest expense for the period from April 9, 2018 through June 30, 2018 recorded on the senior notes issued in connection with our acquisition of Stahlgruber.
|
(2)
|
Includes expenses related to acquisitions closed in the period and excludes expenses for acquisitions not yet completed.
|
(3)
|
Excludes our acquisition of the Czech Republic wholesale business which is classified as discontinued operations.
|
|
June 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Aftermarket and refurbished products
|
$
|
2,181,873
|
|
|
$
|
2,309,458
|
|
Salvage and remanufactured products
|
441,579
|
|
|
503,199
|
|
||
Manufactured products
|
26,686
|
|
|
23,418
|
|
||
Total inventories (1)
|
$
|
2,650,138
|
|
|
$
|
2,836,075
|
|
(1)
|
As of June 30, 2019, $61 million of inventory was included in assets held for sale. Refer to the "Net Assets Held for Sale" section for further information.
|
Balance as of December 31, 2018
|
$
|
23,262
|
|
Warranty expense
|
29,529
|
|
|
Warranty claims
|
(22,770
|
)
|
|
Balance as of June 30, 2019
|
$
|
30,021
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
North America
|
$
|
1,165,482
|
|
|
$
|
1,165,422
|
|
|
$
|
2,321,180
|
|
|
$
|
2,338,007
|
|
Europe
|
1,510,952
|
|
|
1,279,996
|
|
|
2,951,793
|
|
|
2,317,042
|
|
||||
Specialty
|
410,263
|
|
|
411,633
|
|
|
762,819
|
|
|
762,307
|
|
||||
Parts and services
|
3,086,697
|
|
|
2,857,051
|
|
|
6,035,792
|
|
|
5,417,356
|
|
||||
Other
|
161,476
|
|
|
173,700
|
|
|
312,684
|
|
|
334,159
|
|
||||
Total revenue
|
$
|
3,248,173
|
|
|
$
|
3,030,751
|
|
|
$
|
6,348,476
|
|
|
$
|
5,751,515
|
|
Balance as of January 1, 2019
|
$
|
24,006
|
|
Additional warranty revenue deferred
|
21,241
|
|
|
Warranty revenue recognized
|
(19,171
|
)
|
|
Balance as of June 30, 2019
|
$
|
26,076
|
|
|
Number
Outstanding
|
|
Weighted
Average
Grant Date
Fair Value
|
|
Weighted Average Remaining Contractual Term
(in years)
|
|
Aggregate Intrinsic Value
(in thousands) (1)
|
|||||
Unvested as of January 1, 2019
|
1,475,682
|
|
|
$
|
34.94
|
|
|
|
|
|
||
Granted
|
981,906
|
|
|
$
|
27.86
|
|
|
|
|
|
||
Vested
|
(416,262
|
)
|
|
$
|
32.72
|
|
|
|
|
|
||
Forfeited / Canceled
|
(48,674
|
)
|
|
$
|
34.25
|
|
|
|
|
|
||
Unvested as of June 30, 2019
|
1,992,652
|
|
|
$
|
31.93
|
|
|
|
|
|
||
Expected to vest after June 30, 2019
|
1,813,605
|
|
|
$
|
31.97
|
|
|
2.9
|
|
$
|
48,260
|
|
(1)
|
The aggregate intrinsic value of expected to vest RSUs represents the total pretax intrinsic value (the fair value of the Company's stock on the last day of each period multiplied by the number of units) that would have been received by the holders had all RSUs vested. This amount changes based on the market price of the Company’s common stock.
|
|
Number
Outstanding
|
|
Weighted
Average
Grant Date
Fair Value
|
|
Weighted Average Remaining Contractual Term
(in years)
|
|
Aggregate Intrinsic Value
(in thousands) (1)
|
|||||
Unvested as of January 1, 2019
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Granted (2)
|
136,170
|
|
|
$
|
27.69
|
|
|
|
|
|
||
Unvested as of June 30, 2019
|
136,170
|
|
|
$
|
27.69
|
|
|
|
|
|
||
Expected to vest after June 30, 2019
|
136,170
|
|
|
$
|
27.69
|
|
|
2.8
|
|
$
|
3,623
|
|
(1)
|
The aggregate intrinsic value of expected to vest PSUs represents the total pretax intrinsic value (the fair value of the Company's stock on the last day of each period multiplied by the number of units at target) that would have been received by the holders had all PSUs vested. This amount changes based on the market price of the Company’s common stock and the achievement of the performance metrics relative to the established targets.
|
(2)
|
Represents the number of PSUs at target payout.
|
|
Number
Outstanding
|
|
Weighted
Average Exercise Price
|
|
Weighted Average Remaining Contractual Term
(in years)
|
|
Aggregate Intrinsic Value
(in thousands) (1)
|
|||||
Balance as of January 1, 2019
|
1,051,494
|
|
|
$
|
10.15
|
|
|
|
|
|
||
Exercised
|
(236,241
|
)
|
|
$
|
7.92
|
|
|
|
|
$
|
4,324
|
|
Canceled
|
(7,037
|
)
|
|
$
|
16.45
|
|
|
|
|
|
||
Balance as of June 30, 2019
|
808,216
|
|
|
$
|
10.75
|
|
|
0.5
|
|
$
|
13,000
|
|
Exercisable as of June 30, 2019
|
808,216
|
|
|
$
|
10.75
|
|
|
0.5
|
|
$
|
13,000
|
|
(1)
|
The aggregate intrinsic value of outstanding and exercisable options represents the total pretax intrinsic value (the difference between the fair value of the Company's stock on the last day of each period and the exercise price, multiplied by the number of options where the fair value exceeds the exercise price) that would have been received by the option holders had all option holders exercised their options as of the last day of the period indicated. This amount changes based on the market price of the Company’s common stock.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Income from continuing operations
|
$
|
151,707
|
|
|
$
|
157,866
|
|
|
$
|
250,770
|
|
|
$
|
310,629
|
|
Denominator for basic earnings per share—Weighted-average shares outstanding
|
311,891
|
|
|
312,556
|
|
|
313,460
|
|
|
311,045
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
RSUs
|
315
|
|
|
406
|
|
|
364
|
|
|
512
|
|
||||
PSUs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Stock options
|
513
|
|
|
1,050
|
|
|
536
|
|
|
1,131
|
|
||||
Denominator for diluted earnings per share—Adjusted weighted-average shares outstanding
|
312,719
|
|
|
314,012
|
|
|
314,360
|
|
|
312,688
|
|
||||
Basic earnings per share from continuing operations
|
$
|
0.49
|
|
|
$
|
0.51
|
|
|
$
|
0.80
|
|
|
$
|
1.00
|
|
Diluted earnings per share from continuing operations
|
$
|
0.49
|
|
|
$
|
0.50
|
|
|
$
|
0.80
|
|
|
$
|
0.99
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
June 30,
|
|
June 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Antidilutive securities:
|
|
|
|
|
|
|
|
||||
RSUs
|
559
|
|
|
575
|
|
|
579
|
|
|
288
|
|
Stock options
|
32
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
|
Three Months Ended
|
||||||||||||||||||
|
|
June 30, 2019
|
||||||||||||||||||
|
|
Foreign
Currency Translation |
|
Unrealized Gain (Loss)
on Cash Flow Hedges |
|
Unrealized (Loss) Gain
on Pension Plans |
|
Other Comprehensive (Loss) Income from Unconsolidated Subsidiaries
|
|
Accumulated
Other Comprehensive (Loss) Income |
||||||||||
Beginning balance
|
|
$
|
(187,492
|
)
|
|
$
|
11,637
|
|
|
$
|
(7,884
|
)
|
|
$
|
(7,115
|
)
|
|
$
|
(190,854
|
)
|
Pretax (loss) income
|
|
5,602
|
|
|
(9,418
|
)
|
|
—
|
|
|
—
|
|
|
(3,816
|
)
|
|||||
Income tax effect
|
|
—
|
|
|
2,230
|
|
|
—
|
|
|
—
|
|
|
2,230
|
|
|||||
Reclassification of unrealized (gain) loss
|
|
—
|
|
|
2,013
|
|
|
37
|
|
|
—
|
|
|
2,050
|
|
|||||
Reclassification of deferred income taxes
|
|
—
|
|
|
(475
|
)
|
|
(9
|
)
|
|
—
|
|
|
(484
|
)
|
|||||
Other comprehensive income from unconsolidated subsidiaries
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,321
|
|
|
2,321
|
|
|||||
Ending balance
|
|
$
|
(181,890
|
)
|
|
$
|
5,987
|
|
|
$
|
(7,856
|
)
|
|
$
|
(4,794
|
)
|
|
$
|
(188,553
|
)
|
|
|
Three Months Ended
|
||||||||||||||||||
|
|
June 30, 2018
|
||||||||||||||||||
|
|
Foreign
Currency Translation |
|
Unrealized Gain (Loss)
on Cash Flow Hedges |
|
Unrealized (Loss) Gain
on Pension Plans |
|
Other Comprehensive (Loss) Income from Unconsolidated Subsidiaries
|
|
Accumulated
Other Comprehensive (Loss) Income |
||||||||||
Beginning balance
|
|
$
|
(20,589
|
)
|
|
$
|
17,278
|
|
|
$
|
(9,393
|
)
|
|
$
|
(1,914
|
)
|
|
$
|
(14,618
|
)
|
Pretax (loss) income
|
|
(107,167
|
)
|
|
30,721
|
|
|
(690
|
)
|
|
—
|
|
|
(77,136
|
)
|
|||||
Income tax effect
|
|
2,003
|
|
|
(7,183
|
)
|
|
(174
|
)
|
|
—
|
|
|
(5,354
|
)
|
|||||
Reclassification of unrealized (gain) loss
|
|
—
|
|
|
(27,580
|
)
|
|
76
|
|
|
—
|
|
|
(27,504
|
)
|
|||||
Reclassification of deferred income taxes
|
|
—
|
|
|
6,448
|
|
|
(19
|
)
|
|
—
|
|
|
6,429
|
|
|||||
Other comprehensive income from unconsolidated subsidiaries
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,122
|
|
|
2,122
|
|
|||||
Ending balance
|
|
$
|
(125,753
|
)
|
|
$
|
19,684
|
|
|
$
|
(10,200
|
)
|
|
$
|
208
|
|
|
$
|
(116,061
|
)
|
|
|
Six Months Ended
|
||||||||||||||||||
|
|
June 30, 2019
|
||||||||||||||||||
|
|
Foreign
Currency Translation |
|
Unrealized Gain (Loss)
on Cash Flow Hedges |
|
Unrealized (Loss) Gain
on Pension Plans |
|
Other Comprehensive Loss from Unconsolidated Subsidiaries
|
|
Accumulated
Other Comprehensive (Loss) Income |
||||||||||
Beginning balance
|
|
$
|
(177,597
|
)
|
|
$
|
14,374
|
|
|
$
|
(8,075
|
)
|
|
$
|
(3,652
|
)
|
|
$
|
(174,950
|
)
|
Pretax (loss) income
|
|
(4,293
|
)
|
|
6,175
|
|
|
—
|
|
|
—
|
|
|
1,882
|
|
|||||
Income tax effect
|
|
—
|
|
|
(1,424
|
)
|
|
—
|
|
|
—
|
|
|
(1,424
|
)
|
|||||
Reclassification of unrealized (gain) loss
|
|
—
|
|
|
(17,175
|
)
|
|
290
|
|
|
—
|
|
|
(16,885
|
)
|
|||||
Reclassification of deferred income taxes
|
|
—
|
|
|
4,037
|
|
|
(71
|
)
|
|
—
|
|
|
3,966
|
|
|||||
Other comprehensive loss from unconsolidated subsidiaries
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,142
|
)
|
|
(1,142
|
)
|
|||||
Ending balance
|
|
$
|
(181,890
|
)
|
|
$
|
5,987
|
|
|
$
|
(7,856
|
)
|
|
$
|
(4,794
|
)
|
|
$
|
(188,553
|
)
|
|
|
Six Months Ended
|
||||||||||||||||||
|
|
June 30, 2018
|
||||||||||||||||||
|
|
Foreign
Currency Translation |
|
Unrealized Gain (Loss)
on Cash Flow Hedges |
|
Unrealized (Loss) Gain
on Pension Plans |
|
Other Comprehensive (Loss) Income from Unconsolidated Subsidiaries
|
|
Accumulated
Other Comprehensive (Loss) Income |
||||||||||
Beginning balance
|
|
$
|
(71,933
|
)
|
|
$
|
11,538
|
|
|
$
|
(8,772
|
)
|
|
$
|
(1,309
|
)
|
|
$
|
(70,476
|
)
|
Pretax (loss) income
|
|
(58,732
|
)
|
|
26,220
|
|
|
(1,319
|
)
|
|
—
|
|
|
(33,831
|
)
|
|||||
Income tax effect
|
|
2,053
|
|
|
(6,130
|
)
|
|
(166
|
)
|
|
—
|
|
|
(4,243
|
)
|
|||||
Reclassification of unrealized (gain) loss
|
|
—
|
|
|
(18,833
|
)
|
|
76
|
|
|
—
|
|
|
(18,757
|
)
|
|||||
Reclassification of deferred income taxes
|
|
—
|
|
|
4,403
|
|
|
(19
|
)
|
|
—
|
|
|
4,384
|
|
|||||
Other comprehensive income from unconsolidated subsidiaries
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,517
|
|
|
1,517
|
|
|||||
Adoption of ASU 2018-02
|
|
2,859
|
|
|
2,486
|
|
|
—
|
|
|
—
|
|
|
5,345
|
|
|||||
Ending balance
|
|
$
|
(125,753
|
)
|
|
$
|
19,684
|
|
|
$
|
(10,200
|
)
|
|
$
|
208
|
|
|
$
|
(116,061
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Unrealized gains on interest rate swaps (1) (2)
|
$
|
2,479
|
|
|
$
|
1,034
|
|
|
$
|
4,942
|
|
|
$
|
2,609
|
|
Unrealized gains on foreign currency forwards (2) (3)
|
3,602
|
|
|
2,776
|
|
|
7,162
|
|
|
4,156
|
|
||||
Unrealized (losses) gains on cross currency swaps (4)
|
(8,094
|
)
|
|
23,770
|
|
|
5,071
|
|
|
12,068
|
|
||||
Total
|
$
|
(2,013
|
)
|
|
$
|
27,580
|
|
|
$
|
17,175
|
|
|
$
|
18,833
|
|
(1)
|
Inclusive of our interest rate swap agreements and the interest rate swap component of our cross currency swaps.
|
(2)
|
Amounts reclassified to Interest expense, net of interest income in our Unaudited Condensed Consolidated Statements of Income.
|
(3)
|
Related to the foreign currency forward component of our cross currency swaps.
|
(4)
|
Amounts reclassified to Other (income) expense, net in our Unaudited Condensed Consolidated Statements of Income. These gains and losses offset the impact of the remeasurement of the underlying contracts.
|
|
June 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Senior secured credit agreement:
|
|
|
|
||||
Term loans payable
|
$
|
345,625
|
|
|
$
|
350,000
|
|
Revolving credit facilities
|
1,228,219
|
|
|
1,387,177
|
|
||
U.S. Notes (2023)
|
600,000
|
|
|
600,000
|
|
||
Euro Notes (2024)
|
568,650
|
|
|
573,350
|
|
||
Euro Notes (2026/28)
|
1,137,300
|
|
|
1,146,700
|
|
||
Receivables securitization facility
|
—
|
|
|
110,000
|
|
||
Notes payable through October 2030 at weighted average interest rates of 3.0% and 2.0%, respectively
|
41,465
|
|
|
23,056
|
|
||
Finance lease obligations
|
41,935
|
|
|
39,966
|
|
||
Other long-term debt at weighted average interest rates of 1.8% and 1.8%, respectively
|
123,104
|
|
|
117,448
|
|
||
Total debt
|
4,086,298
|
|
|
4,347,697
|
|
||
Less: long-term debt issuance costs
|
(33,469
|
)
|
|
(36,906
|
)
|
||
Less: current debt issuance costs
|
(286
|
)
|
|
(291
|
)
|
||
Total debt, net of debt issuance costs
|
4,052,543
|
|
|
4,310,500
|
|
||
Less: current maturities, net of debt issuance costs
|
(132,641
|
)
|
|
(121,826
|
)
|
||
Long term debt, net of debt issuance costs
|
$
|
3,919,902
|
|
|
$
|
4,188,674
|
|
|
Balance as of
June 30, 2019
|
|
Fair Value Measurements as of June 30, 2019
|
||||||||||||
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash surrender value of life insurance
|
$
|
55,501
|
|
|
$
|
—
|
|
|
$
|
55,501
|
|
|
$
|
—
|
|
Interest rate swaps
|
5,519
|
|
|
—
|
|
|
5,519
|
|
|
—
|
|
||||
Cross currency swap agreements
|
4,010
|
|
|
—
|
|
|
4,010
|
|
|
—
|
|
||||
Total Assets
|
$
|
65,030
|
|
|
$
|
—
|
|
|
$
|
65,030
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration liabilities
|
$
|
10,884
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,884
|
|
Deferred compensation liabilities
|
59,012
|
|
|
—
|
|
|
59,012
|
|
|
—
|
|
||||
Cross currency swap agreements
|
33,179
|
|
|
—
|
|
|
33,179
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
103,075
|
|
|
$
|
—
|
|
|
$
|
92,191
|
|
|
$
|
10,884
|
|
|
Balance as of December 31, 2018
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash surrender value of life insurance
|
$
|
47,649
|
|
|
$
|
—
|
|
|
$
|
47,649
|
|
|
$
|
—
|
|
Interest rate swaps
|
14,967
|
|
|
—
|
|
|
14,967
|
|
|
—
|
|
||||
Cross currency swap agreements
|
7,880
|
|
|
—
|
|
|
7,880
|
|
|
—
|
|
||||
Total Assets
|
$
|
70,496
|
|
|
$
|
—
|
|
|
$
|
70,496
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration liabilities
|
$
|
5,209
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,209
|
|
Deferred compensation liabilities
|
48,984
|
|
|
—
|
|
|
48,984
|
|
|
—
|
|
||||
Cross currency swap agreements
|
40,997
|
|
|
—
|
|
|
40,997
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
95,190
|
|
|
$
|
—
|
|
|
$
|
89,981
|
|
|
$
|
5,209
|
|
Leases
|
|
Classification
|
|
June 30, 2019
|
||
|
|
|
|
|
||
Assets
|
|
|
|
|
||
Operating lease assets, net
|
|
Operating lease assets, net
|
|
$
|
1,294,541
|
|
Finance lease assets, net
|
|
Property, plant and equipment, net
|
|
41,911
|
|
|
Total leased assets
|
|
|
|
$
|
1,336,452
|
|
Liabilities
|
|
|
|
|
||
Current
|
|
|
|
|
||
Operating
|
|
Current portion of operating lease liabilities
|
|
$
|
219,502
|
|
Finance
|
|
Current portion of long-term obligations
|
|
10,802
|
|
|
Noncurrent
|
|
|
|
|
||
Operating
|
|
Long-term operating lease liabilities
|
|
1,122,276
|
|
|
Finance
|
|
Long-term obligations, excluding current portion
|
|
31,133
|
|
|
Total lease liabilities
|
|
|
|
$
|
1,383,713
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||
Lease Cost
|
|
Classification
|
|
June 30, 2019
|
|
June 30, 2019
|
||||
|
|
|
|
|
|
|
||||
Operating lease cost
|
|
Cost of goods sold
|
|
$
|
5,876
|
|
|
$
|
9,712
|
|
Operating lease cost
|
|
Selling, general and administrative expenses
|
|
77,142
|
|
|
150,423
|
|
||
Short-term lease cost
|
|
Selling, general and administrative expenses
|
|
3,799
|
|
|
4,466
|
|
||
Variable lease cost
|
|
Selling, general and administrative expenses
|
|
25,199
|
|
|
51,189
|
|
||
Finance lease cost
|
|
|
|
|
|
|
||||
Amortization of leased assets
|
|
Depreciation and amortization
|
|
2,624
|
|
|
5,222
|
|
||
Interest on lease liabilities
|
|
Interest expense, net of interest income
|
|
405
|
|
|
853
|
|
||
Sublease income
|
|
Other income, net
|
|
(151
|
)
|
|
(426
|
)
|
||
Net lease cost
|
|
|
|
$
|
114,894
|
|
|
$
|
221,439
|
|
Years ending December 31:
|
|
||
2019
|
$
|
294,269
|
|
2020
|
256,172
|
|
|
2021
|
210,632
|
|
|
2022
|
158,763
|
|
|
2023
|
131,518
|
|
|
Thereafter
|
777,165
|
|
|
Future Minimum Lease Payments
|
$
|
1,828,519
|
|
|
Operating leases
|
|
Finance leases (1)
|
|
Total
|
||||||
Six months ending December 31, 2019
|
$
|
151,302
|
|
|
$
|
6,374
|
|
|
$
|
157,676
|
|
Years ending December 31:
|
|
|
|
|
|
||||||
2020
|
276,873
|
|
|
11,109
|
|
|
287,982
|
|
|||
2021
|
230,912
|
|
|
9,229
|
|
|
240,141
|
|
|||
2022
|
178,807
|
|
|
6,718
|
|
|
185,525
|
|
|||
2023
|
148,754
|
|
|
2,888
|
|
|
151,642
|
|
|||
2024
|
123,190
|
|
|
2,773
|
|
|
125,963
|
|
|||
Thereafter
|
724,388
|
|
|
15,953
|
|
|
740,341
|
|
|||
Future minimum lease payments
|
1,834,226
|
|
|
55,044
|
|
|
1,889,270
|
|
|||
Less: Interest
|
492,448
|
|
|
13,109
|
|
|
505,557
|
|
|||
Present value of lease liabilities
|
$
|
1,341,778
|
|
|
$
|
41,935
|
|
|
$
|
1,383,713
|
|
(1)
|
Amounts are included in the scheduled maturities of long-term obligations in the “Liquidity and Capital Resources” section of Management's Discussion and Analysis of Financial Condition and Results of Operations in Part I, Item 2 of this Quarterly Report on Form 10-Q.
|
Lease Term and Discount Rate
|
|
June 30, 2019
|
|
|
|
|
|
Weighted-average remaining lease term (years)
|
|
|
|
Operating leases
|
|
9.6
|
|
Finance leases
|
|
8.6
|
|
Weighted-average discount rate
|
|
|
|
Operating leases
|
|
5.4
|
%
|
Finance leases
|
|
4.5
|
%
|
|
|
Six Months Ended
|
||
Supplemental cash flows information (in thousands)
|
|
June 30, 2019
|
||
|
|
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
|
|
||
Operating cash flows from operating leases
|
|
$
|
147,897
|
|
Financing cash flows from finance leases
|
|
5,464
|
|
|
Leased assets obtained in exchange for new finance lease liabilities
|
|
7,568
|
|
|
Leased assets obtained in exchange for new operating lease liabilities
|
|
61,891
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Service cost
|
$
|
1,074
|
|
|
$
|
516
|
|
|
$
|
1,661
|
|
|
$
|
984
|
|
Interest cost
|
1,010
|
|
|
776
|
|
|
1,995
|
|
|
1,446
|
|
||||
Expected return on plan assets
|
(560
|
)
|
|
(783
|
)
|
|
(1,340
|
)
|
|
(1,500
|
)
|
||||
Amortization of actuarial loss
|
37
|
|
|
76
|
|
|
290
|
|
|
76
|
|
||||
Net periodic benefit cost
|
$
|
1,561
|
|
|
$
|
585
|
|
|
$
|
2,606
|
|
|
$
|
1,006
|
|
|
North America
|
|
Europe
|
|
Specialty
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
Third Party
|
$
|
1,321,670
|
|
|
$
|
1,516,240
|
|
|
$
|
410,263
|
|
|
$
|
—
|
|
|
$
|
3,248,173
|
|
Intersegment
|
96
|
|
|
—
|
|
|
1,373
|
|
|
(1,469
|
)
|
|
—
|
|
|||||
Total segment revenue
|
$
|
1,321,766
|
|
|
$
|
1,516,240
|
|
|
$
|
411,636
|
|
|
$
|
(1,469
|
)
|
|
$
|
3,248,173
|
|
Segment EBITDA
|
$
|
190,048
|
|
|
$
|
116,281
|
|
|
$
|
52,367
|
|
|
$
|
—
|
|
|
$
|
358,696
|
|
Depreciation and amortization (1)
|
22,425
|
|
|
46,774
|
|
|
6,955
|
|
|
—
|
|
|
76,154
|
|
|||||
Three Months Ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
Third Party
|
$
|
1,334,965
|
|
|
$
|
1,284,153
|
|
|
$
|
411,633
|
|
|
$
|
—
|
|
|
$
|
3,030,751
|
|
Intersegment
|
201
|
|
|
—
|
|
|
1,240
|
|
|
(1,441
|
)
|
|
—
|
|
|||||
Total segment revenue
|
$
|
1,335,166
|
|
|
$
|
1,284,153
|
|
|
$
|
412,873
|
|
|
$
|
(1,441
|
)
|
|
$
|
3,030,751
|
|
Segment EBITDA
|
$
|
175,010
|
|
|
$
|
110,893
|
|
|
$
|
56,068
|
|
|
$
|
—
|
|
|
$
|
341,971
|
|
Depreciation and amortization (1)
|
21,606
|
|
|
39,801
|
|
|
7,031
|
|
|
—
|
|
|
68,438
|
|
|
North America
|
|
Europe
|
|
Specialty
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
Third Party
|
$
|
2,623,876
|
|
|
$
|
2,961,781
|
|
|
$
|
762,819
|
|
|
$
|
—
|
|
|
$
|
6,348,476
|
|
Intersegment
|
199
|
|
|
—
|
|
|
2,554
|
|
|
(2,753
|
)
|
|
—
|
|
|||||
Total segment revenue
|
$
|
2,624,075
|
|
|
$
|
2,961,781
|
|
|
$
|
765,373
|
|
|
$
|
(2,753
|
)
|
|
$
|
6,348,476
|
|
Segment EBITDA
|
$
|
366,684
|
|
|
$
|
221,579
|
|
|
$
|
90,326
|
|
|
$
|
—
|
|
|
$
|
678,589
|
|
Depreciation and amortization (1)
|
44,664
|
|
|
93,785
|
|
|
13,912
|
|
|
—
|
|
|
152,361
|
|
|||||
Six Months Ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
Third Party
|
$
|
2,664,625
|
|
|
$
|
2,324,583
|
|
|
$
|
762,307
|
|
|
$
|
—
|
|
|
$
|
5,751,515
|
|
Intersegment
|
384
|
|
|
—
|
|
|
2,358
|
|
|
(2,742
|
)
|
|
—
|
|
|||||
Total segment revenue
|
$
|
2,665,009
|
|
|
$
|
2,324,583
|
|
|
$
|
764,665
|
|
|
$
|
(2,742
|
)
|
|
$
|
5,751,515
|
|
Segment EBITDA
|
$
|
352,723
|
|
|
$
|
186,427
|
|
|
$
|
98,037
|
|
|
$
|
—
|
|
|
$
|
637,187
|
|
Depreciation and amortization (1)
|
42,834
|
|
|
72,558
|
|
|
14,112
|
|
|
—
|
|
|
129,504
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
June 30,
|
|
June 30,
|
|||||||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||
Net income
|
$
|
152,105
|
|
|
$
|
157,866
|
|
|
$
|
251,168
|
|
|
$
|
310,629
|
|
Less: net income attributable to continuing noncontrolling interest
|
1,352
|
|
|
859
|
|
|
2,367
|
|
|
662
|
|
||||
Less: net income attributable to discontinued noncontrolling interest
|
192
|
|
|
—
|
|
|
192
|
|
|
—
|
|
||||
Net income attributable to LKQ stockholders
|
150,561
|
|
|
157,007
|
|
|
248,609
|
|
|
309,967
|
|
||||
Subtract:
|
|
|
|
|
|
|
|
||||||||
Net income from discontinued operations
|
398
|
|
|
—
|
|
|
398
|
|
|
—
|
|
||||
Net income attributable to discontinued noncontrolling interest
|
(192
|
)
|
|
—
|
|
|
(192
|
)
|
|
—
|
|
||||
Net income from continuing operations attributable to LKQ stockholders
|
150,355
|
|
|
157,007
|
|
|
248,403
|
|
|
309,967
|
|
||||
Add:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization
|
70,834
|
|
|
63,163
|
|
|
141,836
|
|
|
119,621
|
|
||||
Depreciation and amortization - cost of goods sold
|
5,320
|
|
|
5,275
|
|
|
10,525
|
|
|
9,883
|
|
||||
Interest expense, net of interest income
|
35,884
|
|
|
38,272
|
|
|
71,973
|
|
|
66,787
|
|
||||
Provision for income taxes
|
55,825
|
|
|
60,775
|
|
|
107,375
|
|
|
110,359
|
|
||||
EBITDA
|
318,218
|
|
|
324,492
|
|
|
580,112
|
|
|
616,617
|
|
||||
Subtract:
|
|
|
|
|
|
|
|
||||||||
Equity in earnings (losses) of unconsolidated subsidiaries (1)
|
1,572
|
|
|
546
|
|
|
(37,977
|
)
|
|
1,958
|
|
||||
Gains on bargain purchase
|
—
|
|
|
328
|
|
|
—
|
|
|
328
|
|
||||
Add:
|
|
|
|
|
|
|
|
||||||||
Restructuring and acquisition related expenses (2)
|
8,377
|
|
|
15,878
|
|
|
11,684
|
|
|
19,932
|
|
||||
Inventory step-up adjustment - acquisition related
|
—
|
|
|
—
|
|
|
—
|
|
|
403
|
|
||||
Impairment of net assets held for sale (3) (4)
|
33,497
|
|
|
2,438
|
|
|
48,520
|
|
|
2,438
|
|
||||
Change in fair value of contingent consideration liabilities
|
176
|
|
|
37
|
|
|
296
|
|
|
83
|
|
||||
Segment EBITDA
|
$
|
358,696
|
|
|
$
|
341,971
|
|
|
$
|
678,589
|
|
|
$
|
637,187
|
|
(1)
|
Refer to "Investments in Unconsolidated Subsidiaries" in Note 4, "Financial Statement Information," for further information.
|
(2)
|
Refer to Note 6, "Restructuring and Acquisition Related Expenses," for further information.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
June 30,
|
|
June 30,
|
|||||||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||
Capital Expenditures
|
|
|
|
|
|
|
|
||||||||
North America
|
$
|
23,169
|
|
|
$
|
29,206
|
|
|
$
|
54,403
|
|
|
$
|
58,868
|
|
Europe
|
21,840
|
|
|
16,863
|
|
|
41,417
|
|
|
45,678
|
|
||||
Specialty
|
3,243
|
|
|
7,163
|
|
|
5,448
|
|
|
10,875
|
|
||||
Total capital expenditures
|
$
|
48,252
|
|
|
$
|
53,232
|
|
|
$
|
101,268
|
|
|
$
|
115,421
|
|
|
June 30,
|
|
December 31,
|
||||
2019
|
|
2018
|
|||||
Receivables, net
|
|
|
|
||||
North America
|
$
|
423,626
|
|
|
$
|
411,818
|
|
Europe
|
725,834
|
|
|
649,174
|
|
||
Specialty
|
136,342
|
|
|
93,091
|
|
||
Total receivables, net
|
1,285,802
|
|
|
1,154,083
|
|
||
Inventories
|
|
|
|
||||
North America
|
996,548
|
|
|
1,076,306
|
|
||
Europe
|
1,326,836
|
|
|
1,410,264
|
|
||
Specialty
|
326,754
|
|
|
349,505
|
|
||
Total inventories
|
2,650,138
|
|
|
2,836,075
|
|
||
Property, plant and equipment, net
|
|
|
|
||||
North America
|
577,799
|
|
|
570,508
|
|
||
Europe
|
543,772
|
|
|
562,600
|
|
||
Specialty
|
85,119
|
|
|
87,054
|
|
||
Total property, plant and equipment, net
|
1,206,690
|
|
|
1,220,162
|
|
||
Operating lease assets, net (1)
|
|
|
|
||||
North America
|
781,119
|
|
|
—
|
|
||
Europe
|
431,288
|
|
|
—
|
|
||
Specialty
|
82,134
|
|
|
—
|
|
||
Total operating lease assets, net
|
1,294,541
|
|
|
—
|
|
||
Equity method investments
|
|
|
|
||||
North America
|
16,882
|
|
|
16,404
|
|
||
Europe (2)
|
116,272
|
|
|
162,765
|
|
||
Total equity method investments
|
133,154
|
|
|
179,169
|
|
||
Other unallocated assets
|
6,133,911
|
|
|
6,003,913
|
|
||
Total assets
|
$
|
12,704,236
|
|
|
$
|
11,393,402
|
|
(1)
|
Refer to Note 13, "Leases," for further information.
|
(2)
|
Refer to "Investments in Unconsolidated Subsidiaries" in Note 4, "Financial Statement Information," for further information.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
1,613,417
|
|
|
$
|
1,621,343
|
|
|
$
|
3,155,443
|
|
|
$
|
3,181,370
|
|
United Kingdom
|
409,765
|
|
|
454,689
|
|
|
822,578
|
|
|
885,681
|
|
||||
Germany
|
415,947
|
|
|
148,147
|
|
|
802,412
|
|
|
148,950
|
|
||||
Other countries
|
809,044
|
|
|
806,572
|
|
|
1,568,043
|
|
|
1,535,514
|
|
||||
Total revenue
|
$
|
3,248,173
|
|
|
$
|
3,030,751
|
|
|
$
|
6,348,476
|
|
|
$
|
5,751,515
|
|
|
June 30,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
Long-lived assets (1)
|
|
|
|
||||
United States
|
$
|
1,445,337
|
|
|
$
|
620,125
|
|
Germany
|
306,861
|
|
|
217,476
|
|
||
United Kingdom
|
325,417
|
|
|
165,145
|
|
||
Other countries
|
423,616
|
|
|
217,416
|
|
||
Total long-lived assets
|
$
|
2,501,231
|
|
|
$
|
1,220,162
|
|
(1)
|
The increase in long-lived assets is primarily related to the net operating lease assets added as a result of the adoption of the new lease accounting standard. Refer to Note 13, "Leases," for further information.
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Income
(In thousands)
|
|||||||||||||||||||
|
For the Three Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
1,629,925
|
|
|
$
|
1,656,317
|
|
|
$
|
(38,069
|
)
|
|
$
|
3,248,173
|
|
Cost of goods sold
|
—
|
|
|
974,156
|
|
|
1,064,899
|
|
|
(38,069
|
)
|
|
2,000,986
|
|
|||||
Gross margin
|
—
|
|
|
655,769
|
|
|
591,418
|
|
|
—
|
|
|
1,247,187
|
|
|||||
Selling, general and administrative expenses
|
12,691
|
|
|
426,886
|
|
|
458,791
|
|
|
—
|
|
|
898,368
|
|
|||||
Restructuring and acquisition related expenses
|
—
|
|
|
4,031
|
|
|
4,346
|
|
|
—
|
|
|
8,377
|
|
|||||
Impairment of net assets held for sale
|
—
|
|
|
33,233
|
|
|
264
|
|
|
—
|
|
|
33,497
|
|
|||||
Depreciation and amortization
|
38
|
|
|
25,176
|
|
|
45,620
|
|
|
—
|
|
|
70,834
|
|
|||||
Operating (loss) income
|
(12,729
|
)
|
|
166,443
|
|
|
82,397
|
|
|
—
|
|
|
236,111
|
|
|||||
Other expense (income):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net of interest income
|
12,786
|
|
|
217
|
|
|
22,881
|
|
|
—
|
|
|
35,884
|
|
|||||
Intercompany interest (income) expense, net
|
(14,763
|
)
|
|
8,471
|
|
|
6,292
|
|
|
—
|
|
|
—
|
|
|||||
Other income, net
|
(4
|
)
|
|
(4,342
|
)
|
|
(1,387
|
)
|
|
—
|
|
|
(5,733
|
)
|
|||||
Total other (income) expense, net
|
(1,981
|
)
|
|
4,346
|
|
|
27,786
|
|
|
—
|
|
|
30,151
|
|
|||||
(Loss) income before (benefit) provision for income taxes
|
(10,748
|
)
|
|
162,097
|
|
|
54,611
|
|
|
—
|
|
|
205,960
|
|
|||||
(Benefit) provision for income taxes
|
(2,992
|
)
|
|
43,118
|
|
|
15,699
|
|
|
—
|
|
|
55,825
|
|
|||||
Equity in (losses) earnings of unconsolidated subsidiaries
|
—
|
|
|
(669
|
)
|
|
2,241
|
|
|
—
|
|
|
1,572
|
|
|||||
Equity in earnings (losses) of subsidiaries
|
157,919
|
|
|
(600
|
)
|
|
—
|
|
|
(157,319
|
)
|
|
—
|
|
|||||
Income from continuing operations
|
150,163
|
|
|
117,710
|
|
|
41,153
|
|
|
(157,319
|
)
|
|
151,707
|
|
|||||
Net income from discontinued operations
|
398
|
|
|
—
|
|
|
398
|
|
|
(398
|
)
|
|
398
|
|
|||||
Net income
|
150,561
|
|
|
117,710
|
|
|
41,551
|
|
|
(157,717
|
)
|
|
152,105
|
|
|||||
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
1,352
|
|
|
—
|
|
|
1,352
|
|
|||||
Less: net income attributable to discontinued noncontrolling interest
|
—
|
|
|
—
|
|
|
192
|
|
|
—
|
|
|
192
|
|
|||||
Net income attributable to LKQ stockholders
|
$
|
150,561
|
|
|
$
|
117,710
|
|
|
$
|
40,007
|
|
|
$
|
(157,717
|
)
|
|
$
|
150,561
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Income
(In thousands)
|
|||||||||||||||||||
|
For the Three Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
1,640,396
|
|
|
$
|
1,426,650
|
|
|
$
|
(36,295
|
)
|
|
$
|
3,030,751
|
|
Cost of goods sold
|
—
|
|
|
988,671
|
|
|
916,496
|
|
|
(36,295
|
)
|
|
1,868,872
|
|
|||||
Gross margin
|
—
|
|
|
651,725
|
|
|
510,154
|
|
|
—
|
|
|
1,161,879
|
|
|||||
Selling, general and administrative expenses
|
9,683
|
|
|
430,693
|
|
|
385,668
|
|
|
—
|
|
|
826,044
|
|
|||||
Restructuring and acquisition related expenses
|
—
|
|
|
—
|
|
|
15,878
|
|
|
—
|
|
|
15,878
|
|
|||||
Depreciation and amortization
|
21
|
|
|
24,526
|
|
|
38,616
|
|
|
—
|
|
|
63,163
|
|
|||||
Operating (loss) income
|
(9,704
|
)
|
|
196,506
|
|
|
69,992
|
|
|
—
|
|
|
256,794
|
|
|||||
Other expense (income):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net of interest income
|
17,805
|
|
|
(113
|
)
|
|
20,580
|
|
|
—
|
|
|
38,272
|
|
|||||
Intercompany interest (income) expense, net
|
(15,406
|
)
|
|
9,865
|
|
|
5,541
|
|
|
—
|
|
|
—
|
|
|||||
Other expense (income), net
|
117
|
|
|
(4,397
|
)
|
|
4,707
|
|
|
—
|
|
|
427
|
|
|||||
Total other expense, net
|
2,516
|
|
|
5,355
|
|
|
30,828
|
|
|
—
|
|
|
38,699
|
|
|||||
(Loss) income before (benefit) provision for income taxes
|
(12,220
|
)
|
|
191,151
|
|
|
39,164
|
|
|
—
|
|
|
218,095
|
|
|||||
(Benefit) provision for income taxes
|
(3,744
|
)
|
|
53,543
|
|
|
10,976
|
|
|
—
|
|
|
60,775
|
|
|||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
—
|
|
|
546
|
|
|
—
|
|
|
546
|
|
|||||
Equity in earnings of subsidiaries
|
165,483
|
|
|
4,451
|
|
|
—
|
|
|
(169,934
|
)
|
|
—
|
|
|||||
Net income
|
157,007
|
|
|
142,059
|
|
|
28,734
|
|
|
(169,934
|
)
|
|
157,866
|
|
|||||
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
859
|
|
|
—
|
|
|
859
|
|
|||||
Net income attributable to LKQ stockholders
|
$
|
157,007
|
|
|
$
|
142,059
|
|
|
$
|
27,875
|
|
|
$
|
(169,934
|
)
|
|
$
|
157,007
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Income
(In thousands)
|
|||||||||||||||||||
|
For the Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
3,180,605
|
|
|
$
|
3,243,194
|
|
|
$
|
(75,323
|
)
|
|
$
|
6,348,476
|
|
Cost of goods sold
|
—
|
|
|
1,895,645
|
|
|
2,072,703
|
|
|
(75,323
|
)
|
|
3,893,025
|
|
|||||
Gross margin
|
—
|
|
|
1,284,960
|
|
|
1,170,491
|
|
|
—
|
|
|
2,455,451
|
|
|||||
Selling, general and administrative expenses
|
21,729
|
|
|
859,273
|
|
|
913,898
|
|
|
—
|
|
|
1,794,900
|
|
|||||
Restructuring and acquisition related expenses
|
—
|
|
|
4,637
|
|
|
7,047
|
|
|
—
|
|
|
11,684
|
|
|||||
Impairment of net assets held for sale
|
—
|
|
|
41,694
|
|
|
6,826
|
|
|
—
|
|
|
48,520
|
|
|||||
Depreciation and amortization
|
92
|
|
|
50,249
|
|
|
91,495
|
|
|
—
|
|
|
141,836
|
|
|||||
Operating (loss) income
|
(21,821
|
)
|
|
329,107
|
|
|
151,225
|
|
|
—
|
|
|
458,511
|
|
|||||
Other expense (income):
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net of interest income
|
26,622
|
|
|
(119
|
)
|
|
45,470
|
|
|
—
|
|
|
71,973
|
|
|||||
Intercompany interest (income) expense, net
|
(29,849
|
)
|
|
17,660
|
|
|
12,189
|
|
|
—
|
|
|
—
|
|
|||||
Other expense (income), net
|
15
|
|
|
(12,173
|
)
|
|
2,574
|
|
|
—
|
|
|
(9,584
|
)
|
|||||
Total other (income) expense, net
|
(3,212
|
)
|
|
5,368
|
|
|
60,233
|
|
|
—
|
|
|
62,389
|
|
|||||
(Loss) income before (benefit) provision for income taxes
|
(18,609
|
)
|
|
323,739
|
|
|
90,992
|
|
|
—
|
|
|
396,122
|
|
|||||
(Benefit) provision for income taxes
|
(5,038
|
)
|
|
86,421
|
|
|
25,992
|
|
|
—
|
|
|
107,375
|
|
|||||
Equity in earnings (losses) of unconsolidated subsidiaries
|
—
|
|
|
478
|
|
|
(38,455
|
)
|
|
—
|
|
|
(37,977
|
)
|
|||||
Equity in earnings of subsidiaries
|
261,782
|
|
|
9,112
|
|
|
—
|
|
|
(270,894
|
)
|
|
—
|
|
|||||
Income from continuing operations
|
248,211
|
|
|
246,908
|
|
|
26,545
|
|
|
(270,894
|
)
|
|
250,770
|
|
|||||
Net income from discontinued operations
|
398
|
|
|
—
|
|
|
398
|
|
|
(398
|
)
|
|
398
|
|
|||||
Net income
|
248,609
|
|
|
246,908
|
|
|
26,943
|
|
|
(271,292
|
)
|
|
251,168
|
|
|||||
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
2,367
|
|
|
—
|
|
|
2,367
|
|
|||||
Less: net income attributable to discontinued noncontrolling interest
|
—
|
|
|
—
|
|
|
192
|
|
|
—
|
|
|
192
|
|
|||||
Net income attributable to LKQ stockholders
|
$
|
248,609
|
|
|
$
|
246,908
|
|
|
$
|
24,384
|
|
|
$
|
(271,292
|
)
|
|
$
|
248,609
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Income
(In thousands)
|
|||||||||||||||||||
|
For the Six Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Revenue
|
$
|
—
|
|
|
$
|
3,217,991
|
|
|
$
|
2,606,892
|
|
|
$
|
(73,368
|
)
|
|
$
|
5,751,515
|
|
Cost of goods sold
|
—
|
|
|
1,934,586
|
|
|
1,674,447
|
|
|
(73,368
|
)
|
|
3,535,665
|
|
|||||
Gross margin
|
—
|
|
|
1,283,405
|
|
|
932,445
|
|
|
—
|
|
|
2,215,850
|
|
|||||
Selling, general and administrative expenses
|
18,813
|
|
|
857,490
|
|
|
716,632
|
|
|
—
|
|
|
1,592,935
|
|
|||||
Restructuring and acquisition related expenses
|
—
|
|
|
330
|
|
|
19,602
|
|
|
—
|
|
|
19,932
|
|
|||||
Depreciation and amortization
|
50
|
|
|
48,864
|
|
|
70,707
|
|
|
—
|
|
|
119,621
|
|
|||||
Operating (loss) income
|
(18,863
|
)
|
|
376,721
|
|
|
125,504
|
|
|
—
|
|
|
483,362
|
|
|||||
Other expense (income):
|
|
|
|
|
|
|
|
|
—
|
|
|||||||||
Interest expense, net of interest income
|
35,813
|
|
|
99
|
|
|
30,875
|
|
|
—
|
|
|
66,787
|
|
|||||
Intercompany interest (income) expense, net
|
(30,806
|
)
|
|
19,545
|
|
|
11,261
|
|
|
—
|
|
|
—
|
|
|||||
Other (income) expense, net
|
(898
|
)
|
|
(10,279
|
)
|
|
8,722
|
|
|
—
|
|
|
(2,455
|
)
|
|||||
Total other expense, net
|
4,109
|
|
|
9,365
|
|
|
50,858
|
|
|
—
|
|
|
64,332
|
|
|||||
(Loss) income before (benefit) provision for income taxes
|
(22,972
|
)
|
|
367,356
|
|
|
74,646
|
|
|
—
|
|
|
419,030
|
|
|||||
(Benefit) provision for income taxes
|
(7,648
|
)
|
|
99,420
|
|
|
18,587
|
|
|
—
|
|
|
110,359
|
|
|||||
Equity in earnings of unconsolidated subsidiaries
|
—
|
|
|
—
|
|
|
1,958
|
|
|
—
|
|
|
1,958
|
|
|||||
Equity in earnings of subsidiaries
|
325,291
|
|
|
9,561
|
|
|
—
|
|
|
(334,852
|
)
|
|
—
|
|
|||||
Net income
|
309,967
|
|
|
277,497
|
|
|
58,017
|
|
|
(334,852
|
)
|
|
310,629
|
|
|||||
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
662
|
|
|
—
|
|
|
662
|
|
|||||
Net income attributable to LKQ stockholders
|
$
|
309,967
|
|
|
$
|
277,497
|
|
|
$
|
57,355
|
|
|
$
|
(334,852
|
)
|
|
$
|
309,967
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Comprehensive Income
(In thousands)
|
|||||||||||||||||||
|
For the Three Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
150,561
|
|
|
$
|
117,710
|
|
|
$
|
41,551
|
|
|
$
|
(157,717
|
)
|
|
$
|
152,105
|
|
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
1,352
|
|
|
—
|
|
|
1,352
|
|
|||||
Less: net income attributable to discontinued noncontrolling interest
|
—
|
|
|
—
|
|
|
192
|
|
|
—
|
|
|
192
|
|
|||||
Net income attributable to LKQ stockholders
|
150,561
|
|
|
117,710
|
|
|
40,007
|
|
|
(157,717
|
)
|
|
150,561
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation, net of tax
|
5,602
|
|
|
2,342
|
|
|
5,086
|
|
|
(7,428
|
)
|
|
5,602
|
|
|||||
Net change in unrealized gains/losses on cash flow hedges, net of tax
|
(5,650
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,650
|
)
|
|||||
Net change in unrealized gains/losses on pension plans, net of tax
|
28
|
|
|
(10
|
)
|
|
38
|
|
|
(28
|
)
|
|
28
|
|
|||||
Net change in other comprehensive income from unconsolidated subsidiaries
|
2,321
|
|
|
—
|
|
|
2,321
|
|
|
(2,321
|
)
|
|
2,321
|
|
|||||
Other comprehensive income
|
2,301
|
|
|
2,332
|
|
|
7,445
|
|
|
(9,777
|
)
|
|
2,301
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income
|
152,862
|
|
|
120,042
|
|
|
48,996
|
|
|
(167,494
|
)
|
|
154,406
|
|
|||||
Less: comprehensive income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
1,352
|
|
|
—
|
|
|
1,352
|
|
|||||
Less: comprehensive income attributable to discontinued noncontrolling interest
|
—
|
|
|
—
|
|
|
192
|
|
|
—
|
|
|
192
|
|
|||||
Comprehensive income attributable to LKQ stockholders
|
$
|
152,862
|
|
|
$
|
120,042
|
|
|
$
|
47,452
|
|
|
$
|
(167,494
|
)
|
|
$
|
152,862
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Comprehensive Income
(In thousands)
|
|||||||||||||||||||
|
For the Three Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
157,007
|
|
|
$
|
142,059
|
|
|
$
|
28,734
|
|
|
$
|
(169,934
|
)
|
|
$
|
157,866
|
|
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
859
|
|
|
—
|
|
|
859
|
|
|||||
Net income attributable to LKQ stockholders
|
157,007
|
|
|
142,059
|
|
|
27,875
|
|
|
(169,934
|
)
|
|
157,007
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation, net of tax
|
(105,164
|
)
|
|
(2,303
|
)
|
|
(106,610
|
)
|
|
108,913
|
|
|
(105,164
|
)
|
|||||
Net change in unrealized gains/losses on cash flow hedges, net of tax
|
2,406
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,406
|
|
|||||
Net change in unrealized gains/losses on pension plans, net of tax
|
(807
|
)
|
|
(864
|
)
|
|
57
|
|
|
807
|
|
|
(807
|
)
|
|||||
Net change in other comprehensive income from unconsolidated subsidiaries
|
2,122
|
|
|
—
|
|
|
2,122
|
|
|
(2,122
|
)
|
|
2,122
|
|
|||||
Other comprehensive loss
|
(101,443
|
)
|
|
(3,167
|
)
|
|
(104,431
|
)
|
|
107,598
|
|
|
(101,443
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income (loss)
|
55,564
|
|
|
138,892
|
|
|
(75,697
|
)
|
|
(62,336
|
)
|
|
56,423
|
|
|||||
Less: comprehensive income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
859
|
|
|
—
|
|
|
859
|
|
|||||
Comprehensive income (loss) attributable to LKQ stockholders
|
$
|
55,564
|
|
|
$
|
138,892
|
|
|
$
|
(76,556
|
)
|
|
$
|
(62,336
|
)
|
|
$
|
55,564
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Comprehensive Income
(In thousands)
|
|||||||||||||||||||
|
For the Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
248,609
|
|
|
$
|
246,908
|
|
|
$
|
26,943
|
|
|
$
|
(271,292
|
)
|
|
$
|
251,168
|
|
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
2,367
|
|
|
—
|
|
|
2,367
|
|
|||||
Less: net income attributable to discontinued noncontrolling interest
|
—
|
|
|
—
|
|
|
192
|
|
|
—
|
|
|
192
|
|
|||||
Net income attributable to LKQ stockholders
|
248,609
|
|
|
246,908
|
|
|
24,384
|
|
|
(271,292
|
)
|
|
248,609
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation, net of tax
|
(4,293
|
)
|
|
4,536
|
|
|
(5,380
|
)
|
|
844
|
|
|
(4,293
|
)
|
|||||
Net change in unrealized gains/losses on cash flow hedges, net of tax
|
(8,387
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,387
|
)
|
|||||
Net change in unrealized gains/losses on pension plans, net of tax
|
219
|
|
|
(14
|
)
|
|
233
|
|
|
(219
|
)
|
|
219
|
|
|||||
Net change in other comprehensive loss from unconsolidated subsidiaries
|
(1,142
|
)
|
|
—
|
|
|
(1,142
|
)
|
|
1,142
|
|
|
(1,142
|
)
|
|||||
Other comprehensive (loss) income
|
(13,603
|
)
|
|
4,522
|
|
|
(6,289
|
)
|
|
1,767
|
|
|
(13,603
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income
|
235,006
|
|
|
251,430
|
|
|
20,654
|
|
|
(269,525
|
)
|
|
237,565
|
|
|||||
Less: comprehensive income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
2,367
|
|
|
—
|
|
|
2,367
|
|
|||||
Less: comprehensive income attributable to discontinued noncontrolling interest
|
—
|
|
|
—
|
|
|
192
|
|
|
—
|
|
|
192
|
|
|||||
Comprehensive income attributable to LKQ stockholders
|
$
|
235,006
|
|
|
$
|
251,430
|
|
|
$
|
18,095
|
|
|
$
|
(269,525
|
)
|
|
$
|
235,006
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Comprehensive Income
(In thousands)
|
|||||||||||||||||||
|
For the Six Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
309,967
|
|
|
$
|
277,497
|
|
|
$
|
58,017
|
|
|
$
|
(334,852
|
)
|
|
$
|
310,629
|
|
Less: net income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
662
|
|
|
—
|
|
|
662
|
|
|||||
Net income attributable to LKQ stockholders
|
309,967
|
|
|
277,497
|
|
|
57,355
|
|
|
(334,852
|
)
|
|
309,967
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation, net of tax
|
(56,679
|
)
|
|
(4,486
|
)
|
|
(57,555
|
)
|
|
62,041
|
|
|
(56,679
|
)
|
|||||
Net change in unrealized gains/losses on cash flow hedges, net of tax
|
5,660
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,660
|
|
|||||
Net change in unrealized gains/losses on pension plans, net of tax
|
(1,428
|
)
|
|
(1,485
|
)
|
|
57
|
|
|
1,428
|
|
|
(1,428
|
)
|
|||||
Net change in other comprehensive income from unconsolidated subsidiaries
|
1,517
|
|
|
—
|
|
|
1,517
|
|
|
(1,517
|
)
|
|
1,517
|
|
|||||
Other comprehensive loss
|
(50,930
|
)
|
|
(5,971
|
)
|
|
(55,981
|
)
|
|
61,952
|
|
|
(50,930
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income
|
259,037
|
|
|
271,526
|
|
|
2,036
|
|
|
(272,900
|
)
|
|
259,699
|
|
|||||
Less: comprehensive income attributable to continuing noncontrolling interest
|
—
|
|
|
—
|
|
|
662
|
|
|
—
|
|
|
662
|
|
|||||
Comprehensive income attributable to LKQ stockholders
|
$
|
259,037
|
|
|
$
|
271,526
|
|
|
$
|
1,374
|
|
|
$
|
(272,900
|
)
|
|
$
|
259,037
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Balance Sheets
(In thousands)
|
|||||||||||||||||||
|
June 30, 2019
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
59,244
|
|
|
$
|
42,654
|
|
|
$
|
274,069
|
|
|
$
|
—
|
|
|
$
|
375,967
|
|
Receivables, net
|
562
|
|
|
362,043
|
|
|
923,197
|
|
|
—
|
|
|
1,285,802
|
|
|||||
Intercompany receivables, net
|
8,116
|
|
|
—
|
|
|
28,079
|
|
|
(36,195
|
)
|
|
—
|
|
|||||
Inventories
|
—
|
|
|
1,239,102
|
|
|
1,411,036
|
|
|
—
|
|
|
2,650,138
|
|
|||||
Prepaid expenses and other current assets
|
13,563
|
|
|
134,382
|
|
|
171,997
|
|
|
—
|
|
|
319,942
|
|
|||||
Total current assets
|
81,485
|
|
|
1,778,181
|
|
|
2,808,378
|
|
|
(36,195
|
)
|
|
4,631,849
|
|
|||||
Property, plant and equipment, net
|
1,067
|
|
|
605,005
|
|
|
600,618
|
|
|
—
|
|
|
1,206,690
|
|
|||||
Operating lease assets, net
|
3,806
|
|
|
818,994
|
|
|
471,741
|
|
|
—
|
|
|
1,294,541
|
|
|||||
Intangible assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodwill
|
—
|
|
|
2,004,702
|
|
|
2,405,223
|
|
|
—
|
|
|
4,409,925
|
|
|||||
Other intangibles, net
|
208
|
|
|
257,517
|
|
|
622,398
|
|
|
—
|
|
|
880,123
|
|
|||||
Investment in subsidiaries
|
5,323,410
|
|
|
125,028
|
|
|
—
|
|
|
(5,448,438
|
)
|
|
—
|
|
|||||
Intercompany notes receivable
|
1,167,714
|
|
|
117,962
|
|
|
—
|
|
|
(1,285,676
|
)
|
|
—
|
|
|||||
Equity method investments
|
—
|
|
|
16,882
|
|
|
116,272
|
|
|
—
|
|
|
133,154
|
|
|||||
Other noncurrent assets
|
64,026
|
|
|
40,146
|
|
|
43,782
|
|
|
—
|
|
|
147,954
|
|
|||||
Total assets
|
$
|
6,641,716
|
|
|
$
|
5,764,417
|
|
|
$
|
7,068,412
|
|
|
$
|
(6,770,309
|
)
|
|
$
|
12,704,236
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
2,120
|
|
|
$
|
386,282
|
|
|
$
|
643,550
|
|
|
$
|
—
|
|
|
$
|
1,031,952
|
|
Intercompany payables, net
|
—
|
|
|
28,079
|
|
|
8,116
|
|
|
(36,195
|
)
|
|
—
|
|
|||||
Accrued expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accrued payroll-related liabilities
|
6,405
|
|
|
60,151
|
|
|
105,094
|
|
|
—
|
|
|
171,650
|
|
|||||
Refund liability
|
—
|
|
|
51,875
|
|
|
54,737
|
|
|
—
|
|
|
106,612
|
|
|||||
Other accrued expenses
|
5,167
|
|
|
113,832
|
|
|
190,735
|
|
|
—
|
|
|
309,734
|
|
|||||
Other current liabilities
|
282
|
|
|
27,576
|
|
|
106,997
|
|
|
—
|
|
|
134,855
|
|
|||||
Current portion of operating lease liabilities
|
210
|
|
|
119,744
|
|
|
99,548
|
|
|
—
|
|
|
219,502
|
|
|||||
Current portion of long-term obligations
|
14,510
|
|
|
3,311
|
|
|
114,820
|
|
|
—
|
|
|
132,641
|
|
|||||
Total current liabilities
|
28,694
|
|
|
790,850
|
|
|
1,323,597
|
|
|
(36,195
|
)
|
|
2,106,946
|
|
|||||
Long-term operating lease liabilities, excluding current portion
|
4,000
|
|
|
727,838
|
|
|
390,438
|
|
|
—
|
|
|
1,122,276
|
|
|||||
Long-term obligations, excluding current portion
|
1,636,839
|
|
|
16,242
|
|
|
2,266,821
|
|
|
—
|
|
|
3,919,902
|
|
|||||
Intercompany notes payable
|
—
|
|
|
557,324
|
|
|
728,352
|
|
|
(1,285,676
|
)
|
|
—
|
|
|||||
Deferred income taxes
|
5,432
|
|
|
135,283
|
|
|
162,464
|
|
|
—
|
|
|
303,179
|
|
|||||
Other noncurrent liabilities
|
126,262
|
|
|
79,658
|
|
|
136,265
|
|
|
—
|
|
|
342,185
|
|
|||||
Stockholders' equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Company stockholders' equity
|
4,840,489
|
|
|
3,457,222
|
|
|
1,991,216
|
|
|
(5,448,438
|
)
|
|
4,840,489
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
69,259
|
|
|
—
|
|
|
69,259
|
|
|||||
Total stockholders' equity
|
4,840,489
|
|
|
3,457,222
|
|
|
2,060,475
|
|
|
(5,448,438
|
)
|
|
4,909,748
|
|
|||||
Total liabilities and stockholders' equity
|
$
|
6,641,716
|
|
|
$
|
5,764,417
|
|
|
$
|
7,068,412
|
|
|
$
|
(6,770,309
|
)
|
|
$
|
12,704,236
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Balance Sheets
(In thousands)
|
|||||||||||||||||||
|
December 31, 2018
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
25,633
|
|
|
$
|
29,285
|
|
|
$
|
276,843
|
|
|
$
|
—
|
|
|
$
|
331,761
|
|
Receivables, net
|
310
|
|
|
316,726
|
|
|
837,047
|
|
|
—
|
|
|
1,154,083
|
|
|||||
Intercompany receivables, net
|
6,978
|
|
|
—
|
|
|
12,880
|
|
|
(19,858
|
)
|
|
—
|
|
|||||
Inventories
|
—
|
|
|
1,343,612
|
|
|
1,492,463
|
|
|
—
|
|
|
2,836,075
|
|
|||||
Prepaid expenses and other current assets
|
18,611
|
|
|
99,356
|
|
|
81,063
|
|
|
—
|
|
|
199,030
|
|
|||||
Total current assets
|
51,532
|
|
|
1,788,979
|
|
|
2,700,296
|
|
|
(19,858
|
)
|
|
4,520,949
|
|
|||||
Property, plant and equipment, net
|
1,547
|
|
|
600,054
|
|
|
618,561
|
|
|
—
|
|
|
1,220,162
|
|
|||||
Intangible assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodwill
|
—
|
|
|
1,973,364
|
|
|
2,408,094
|
|
|
—
|
|
|
4,381,458
|
|
|||||
Other intangibles, net
|
260
|
|
|
272,451
|
|
|
656,041
|
|
|
—
|
|
|
928,752
|
|
|||||
Investment in subsidiaries
|
5,224,006
|
|
|
111,826
|
|
|
—
|
|
|
(5,335,832
|
)
|
|
—
|
|
|||||
Intercompany notes receivable
|
1,220,582
|
|
|
10,515
|
|
|
—
|
|
|
(1,231,097
|
)
|
|
—
|
|
|||||
Equity method investments
|
—
|
|
|
16,404
|
|
|
162,765
|
|
|
—
|
|
|
179,169
|
|
|||||
Other noncurrent assets
|
70,283
|
|
|
40,548
|
|
|
52,081
|
|
|
—
|
|
|
162,912
|
|
|||||
Total assets
|
$
|
6,568,210
|
|
|
$
|
4,814,141
|
|
|
$
|
6,597,838
|
|
|
$
|
(6,586,787
|
)
|
|
$
|
11,393,402
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
2,454
|
|
|
$
|
343,116
|
|
|
$
|
596,828
|
|
|
$
|
—
|
|
|
$
|
942,398
|
|
Intercompany payables, net
|
—
|
|
|
12,880
|
|
|
6,978
|
|
|
(19,858
|
)
|
|
—
|
|
|||||
Accrued expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accrued payroll-related liabilities
|
6,652
|
|
|
70,267
|
|
|
95,086
|
|
|
—
|
|
|
172,005
|
|
|||||
Refund liability
|
—
|
|
|
50,899
|
|
|
53,686
|
|
|
—
|
|
|
104,585
|
|
|||||
Other accrued expenses
|
5,454
|
|
|
105,672
|
|
|
177,299
|
|
|
—
|
|
|
288,425
|
|
|||||
Other current liabilities
|
283
|
|
|
17,860
|
|
|
42,966
|
|
|
—
|
|
|
61,109
|
|
|||||
Current portion of long-term obligations
|
8,459
|
|
|
2,932
|
|
|
110,435
|
|
|
—
|
|
|
121,826
|
|
|||||
Total current liabilities
|
23,302
|
|
|
603,626
|
|
|
1,083,278
|
|
|
(19,858
|
)
|
|
1,690,348
|
|
|||||
Long-term obligations, excluding current portion
|
1,628,677
|
|
|
13,532
|
|
|
2,546,465
|
|
|
—
|
|
|
4,188,674
|
|
|||||
Intercompany notes payable
|
—
|
|
|
597,283
|
|
|
633,814
|
|
|
(1,231,097
|
)
|
|
—
|
|
|||||
Deferred income taxes
|
8,045
|
|
|
135,355
|
|
|
168,034
|
|
|
—
|
|
|
311,434
|
|
|||||
Other noncurrent liabilities
|
125,888
|
|
|
99,147
|
|
|
139,159
|
|
|
—
|
|
|
364,194
|
|
|||||
Stockholders' equity:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Company stockholders' equity
|
4,782,298
|
|
|
3,365,198
|
|
|
1,970,634
|
|
|
(5,335,832
|
)
|
|
4,782,298
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
56,454
|
|
|
—
|
|
|
56,454
|
|
|||||
Total stockholders' equity
|
4,782,298
|
|
|
3,365,198
|
|
|
2,027,088
|
|
|
(5,335,832
|
)
|
|
4,838,752
|
|
|||||
Total liabilities and stockholders' equity
|
$
|
6,568,210
|
|
|
$
|
4,814,141
|
|
|
$
|
6,597,838
|
|
|
$
|
(6,586,787
|
)
|
|
$
|
11,393,402
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Cash Flows
(In thousands)
|
|||||||||||||||||||
|
For the Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors (1)
|
|
Eliminations
|
|
Consolidated
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by operating activities
|
$
|
221,964
|
|
|
$
|
95,544
|
|
|
$
|
329,868
|
|
|
$
|
(8,972
|
)
|
|
$
|
638,404
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property, plant and equipment
|
(465
|
)
|
|
(54,687
|
)
|
|
(46,116
|
)
|
|
—
|
|
|
(101,268
|
)
|
|||||
Investment and intercompany note activity with subsidiaries
|
10,199
|
|
|
—
|
|
|
—
|
|
|
(10,199
|
)
|
|
—
|
|
|||||
Acquisitions, net of cash acquired
|
—
|
|
|
(10,118
|
)
|
|
(4,649
|
)
|
|
—
|
|
|
(14,767
|
)
|
|||||
Receipts of deferred purchase price on receivables under factoring arrangements
|
—
|
|
|
186,479
|
|
|
—
|
|
|
(186,479
|
)
|
|
—
|
|
|||||
Other investing activities, net
|
—
|
|
|
(495
|
)
|
|
(240
|
)
|
|
—
|
|
|
(735
|
)
|
|||||
Net cash provided by (used in) investing activities
|
9,734
|
|
|
121,179
|
|
|
(51,005
|
)
|
|
(196,678
|
)
|
|
(116,770
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt issuance costs
|
(35
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|||||
Purchase of treasury stock
|
(190,762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(190,762
|
)
|
|||||
Borrowings under revolving credit facilities
|
196,000
|
|
|
—
|
|
|
116,880
|
|
|
—
|
|
|
312,880
|
|
|||||
Repayments under revolving credit facilities
|
(198,931
|
)
|
|
—
|
|
|
(272,508
|
)
|
|
—
|
|
|
(471,439
|
)
|
|||||
Repayments under term loans
|
(4,375
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,375
|
)
|
|||||
Borrowings under receivables securitization facility
|
—
|
|
|
—
|
|
|
36,600
|
|
|
—
|
|
|
36,600
|
|
|||||
Repayments under receivables securitization facility
|
—
|
|
|
—
|
|
|
(146,600
|
)
|
|
—
|
|
|
(146,600
|
)
|
|||||
(Repayments) borrowings of other debt, net
|
(272
|
)
|
|
176
|
|
|
(8,271
|
)
|
|
—
|
|
|
(8,367
|
)
|
|||||
Other financing activities, net
|
288
|
|
|
—
|
|
|
(178
|
)
|
|
—
|
|
|
110
|
|
|||||
Investment and intercompany note activity with parent
|
—
|
|
|
(8,928
|
)
|
|
(1,271
|
)
|
|
10,199
|
|
|
—
|
|
|||||
Dividends
|
—
|
|
|
(195,451
|
)
|
|
—
|
|
|
195,451
|
|
|
—
|
|
|||||
Net cash used in financing activities
|
(198,087
|
)
|
|
(204,203
|
)
|
|
(275,348
|
)
|
|
205,650
|
|
|
(471,988
|
)
|
|||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
849
|
|
|
(951
|
)
|
|
—
|
|
|
(102
|
)
|
|||||
Net increase in cash, cash equivalents and restricted cash
|
33,611
|
|
|
13,369
|
|
|
2,564
|
|
|
—
|
|
|
49,544
|
|
|||||
Cash, cash equivalents and restricted cash of continuing operations, beginning of period
|
25,633
|
|
|
29,285
|
|
|
282,332
|
|
|
—
|
|
|
337,250
|
|
|||||
Cash, cash equivalents and restricted cash of continuing and discontinued operations, end of period
|
59,244
|
|
|
42,654
|
|
|
284,896
|
|
|
—
|
|
|
386,794
|
|
|||||
Less: Cash and cash equivalents of discontinued operations, end of period
|
—
|
|
|
—
|
|
|
5,372
|
|
|
—
|
|
|
5,372
|
|
|||||
Cash, cash equivalents and restricted cash, end of period
|
$
|
59,244
|
|
|
$
|
42,654
|
|
|
$
|
279,524
|
|
|
$
|
—
|
|
|
$
|
381,422
|
|
LKQ CORPORATION AND SUBSIDIARIES
Unaudited Condensed Consolidating Statements of Cash Flows
(In thousands)
|
|||||||||||||||||||
|
For the Six Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent
|
|
Guarantors
|
|
Non-Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by operating activities
|
$
|
149,253
|
|
|
$
|
115,247
|
|
|
$
|
68,285
|
|
|
$
|
(4,116
|
)
|
|
$
|
328,669
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property, plant and equipment
|
(260
|
)
|
|
(62,744
|
)
|
|
(52,417
|
)
|
|
—
|
|
|
(115,421
|
)
|
|||||
Investment and intercompany note activity with subsidiaries
|
48,339
|
|
|
—
|
|
|
—
|
|
|
(48,339
|
)
|
|
—
|
|
|||||
Acquisitions, net of cash acquired
|
—
|
|
|
(2,527
|
)
|
|
(1,133,443
|
)
|
|
—
|
|
|
(1,135,970
|
)
|
|||||
Receipts of deferred purchase price on receivables under factoring arrangements (1)
|
—
|
|
|
143,983
|
|
|
—
|
|
|
(143,983
|
)
|
|
—
|
|
|||||
Other investing activities, net
|
887
|
|
|
423
|
|
|
864
|
|
|
—
|
|
|
2,174
|
|
|||||
Net cash provided by (used in) investing activities
|
48,966
|
|
|
79,135
|
|
|
(1,184,996
|
)
|
|
(192,322
|
)
|
|
(1,249,217
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Debt issuance costs
|
(682
|
)
|
|
—
|
|
|
(16,077
|
)
|
|
—
|
|
|
(16,759
|
)
|
|||||
Proceeds from issuance of Euro Notes (2026/28)
|
—
|
|
|
—
|
|
|
1,232,100
|
|
|
—
|
|
|
1,232,100
|
|
|||||
Borrowings under revolving credit facilities
|
264,000
|
|
|
—
|
|
|
349,658
|
|
|
—
|
|
|
613,658
|
|
|||||
Repayments under revolving credit facilities
|
(451,931
|
)
|
|
—
|
|
|
(314,666
|
)
|
|
—
|
|
|
(766,597
|
)
|
|||||
Repayments under term loans
|
(8,810
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,810
|
)
|
|||||
(Repayments) borrowings of other debt, net
|
(385
|
)
|
|
289
|
|
|
(2,348
|
)
|
|
—
|
|
|
(2,444
|
)
|
|||||
Other financing activities, net
|
(912
|
)
|
|
—
|
|
|
4,107
|
|
|
—
|
|
|
3,195
|
|
|||||
Investment and intercompany note activity with parent
|
—
|
|
|
(42,596
|
)
|
|
(5,743
|
)
|
|
48,339
|
|
|
—
|
|
|||||
Dividends
|
—
|
|
|
(148,099
|
)
|
|
—
|
|
|
148,099
|
|
|
—
|
|
|||||
Net cash (used in) provided by financing activities
|
(198,720
|
)
|
|
(190,406
|
)
|
|
1,247,031
|
|
|
196,438
|
|
|
1,054,343
|
|
|||||
Effect of exchange rate changes on cash and cash equivalents
|
—
|
|
|
(805
|
)
|
|
(67,554
|
)
|
|
—
|
|
|
(68,359
|
)
|
|||||
Net (decrease) increase in cash and cash equivalents
|
(501
|
)
|
|
3,171
|
|
|
62,766
|
|
|
—
|
|
|
65,436
|
|
|||||
Cash and cash equivalents, beginning of period
|
34,360
|
|
|
35,131
|
|
|
210,275
|
|
|
—
|
|
|
279,766
|
|
|||||
Cash and cash equivalents, end of period
|
$
|
33,859
|
|
|
$
|
38,302
|
|
|
$
|
273,041
|
|
|
$
|
—
|
|
|
$
|
345,202
|
|
(1)
|
The amount was updated to reflect daily transactions compared to the monthly transactions as was initially calculated in 2018.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
June 30,
|
|
June 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of goods sold
|
61.6
|
%
|
|
61.7
|
%
|
|
61.3
|
%
|
|
61.5
|
%
|
Gross margin
|
38.4
|
%
|
|
38.3
|
%
|
|
38.7
|
%
|
|
38.5
|
%
|
Selling, general and administrative expenses
|
27.7
|
%
|
|
27.3
|
%
|
|
28.3
|
%
|
|
27.7
|
%
|
Restructuring and acquisition related expenses
|
0.3
|
%
|
|
0.5
|
%
|
|
0.2
|
%
|
|
0.3
|
%
|
Impairment of net assets held for sale
|
1.0
|
%
|
|
—
|
|
|
0.8
|
%
|
|
—
|
|
Depreciation and amortization
|
2.2
|
%
|
|
2.1
|
%
|
|
2.2
|
%
|
|
2.1
|
%
|
Operating income
|
7.3
|
%
|
|
8.5
|
%
|
|
7.2
|
%
|
|
8.4
|
%
|
Other expense, net
|
0.9
|
%
|
|
1.3
|
%
|
|
1.0
|
%
|
|
1.1
|
%
|
Income from continuing operations before provision for income taxes
|
6.3
|
%
|
|
7.2
|
%
|
|
6.2
|
%
|
|
7.3
|
%
|
Provision for income taxes
|
1.7
|
%
|
|
2.0
|
%
|
|
1.7
|
%
|
|
1.9
|
%
|
Equity in earnings (losses) of unconsolidated subsidiaries
|
0.0
|
%
|
|
0.0
|
%
|
|
(0.6
|
)%
|
|
0.0
|
%
|
Income from continuing operations
|
4.7
|
%
|
|
5.2
|
%
|
|
4.0
|
%
|
|
5.4
|
%
|
Net income from discontinued operations
|
0.0
|
%
|
|
—
|
|
|
0.0
|
%
|
|
—
|
|
Net income
|
4.7
|
%
|
|
5.2
|
%
|
|
4.0
|
%
|
|
5.4
|
%
|
Less: net income attributable to continuing noncontrolling interest
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
|
0.0
|
%
|
Less: net income attributable to discontinued noncontrolling interest
|
0.0
|
%
|
|
—
|
|
|
0.0
|
%
|
|
—
|
|
Net income attributable to LKQ stockholders
|
4.6
|
%
|
|
5.2
|
%
|
|
3.9
|
%
|
|
5.4
|
%
|
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding.
|
|
|
|
|
|
Three Months Ended
|
|
|
||||||||
|
June 30,
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
||||||
Restructuring expenses
|
$
|
8,212
|
|
(1)
|
$
|
2,095
|
|
(2)
|
$
|
6,117
|
|
Acquisition related expenses
|
165
|
|
|
13,783
|
|
(3)
|
(13,618
|
)
|
|||
Total restructuring and acquisition related expenses
|
$
|
8,377
|
|
|
$
|
15,878
|
|
|
$
|
(7,501
|
)
|
(1)
|
Restructuring expenses for the three months ended June 30, 2019 primarily consisted of $5 million related to our 2019 restructuring program and $3 million related to acquisition integration costs.
|
(2)
|
Restructuring expenses for the three months ended June 30, 2018 primarily related to the integration of our acquisition of Andrew Page.
|
(3)
|
Acquisition related expenses for the three months ended June 30, 2018 included $13 million of costs for our acquisition of Stahlgruber.
|
|
Three Months Ended
|
|
|
|
||||||||
|
June 30,
|
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
|
||||||
Depreciation
|
$
|
36,551
|
|
|
$
|
33,536
|
|
|
$
|
3,015
|
|
(1)
|
Amortization
|
34,283
|
|
|
29,627
|
|
|
4,656
|
|
(2)
|
|||
Total depreciation and amortization
|
$
|
70,834
|
|
|
$
|
63,163
|
|
|
$
|
7,671
|
|
|
(1)
|
Depreciation expense increased by $2 million in our Europe segment, principally due to incremental expense from our acquisition of Stahlgruber on May 30, 2018.
|
(2)
|
Amortization expense increased primarily due to an incremental $7 million from our acquisition of Stahlgruber, partially offset by a decrease of $2 million related to the impact of foreign currency translation, principally due to a decrease in the euro exchange rate during the three months ended June 30, 2019 compared to the prior year period.
|
Other expense, net for the three months ended June 30, 2018
|
$
|
38,699
|
|
|
|
Increase (decrease) due to:
|
|
|
|||
Interest expense, net of interest income
|
(2,388
|
)
|
(1)
|
||
Other expense (income), net
|
(6,160
|
)
|
(2)
|
||
Net increase
|
(8,548
|
)
|
|
||
Other expense, net for the three months ended June 30, 2019
|
$
|
30,151
|
|
|
(1)
|
The decrease in interest is primarily related to a $2 million decrease from lower interest rates on borrowings under our senior secured credit agreement compared to the prior year period.
|
(2)
|
The increase in other income primarily consisted of (i) a $4 million favorable variance in foreign currency gains and losses, and (ii) a $2 million non-recurring impairment loss recorded during the second quarter of 2018 related to our Andrew Page operation.
|
|
Six Months Ended
|
|
|
||||||||
|
June 30,
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
||||||
Restructuring expenses
|
$
|
11,198
|
|
(1)
|
$
|
4,132
|
|
(2)
|
$
|
7,066
|
|
Acquisition related expenses
|
486
|
|
|
15,800
|
|
(3)
|
(15,314
|
)
|
|||
Total restructuring and acquisition related expenses
|
$
|
11,684
|
|
|
$
|
19,932
|
|
|
$
|
(8,248
|
)
|
(1)
|
Restructuring expenses for the six months ended June 30, 2019 primarily consisted of $5 million related to our 2019 restructuring program and $6 million related to acquisition integration costs.
|
(2)
|
Restructuring expenses for the six months ended June 30, 2018 primarily related to the integration of our acquisition of Andrew Page.
|
(3)
|
Acquisition related expenses for the six months ended June 30, 2018 included $15 million of costs for our acquisition of Stahlgruber.
|
|
Six Months Ended
|
|
|
|
||||||||
|
June 30,
|
|
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
|
||||||
Depreciation
|
$
|
72,372
|
|
|
$
|
65,801
|
|
|
$
|
6,571
|
|
(1)
|
Amortization
|
69,464
|
|
|
53,820
|
|
|
15,644
|
|
(2)
|
|||
Total depreciation and amortization
|
$
|
141,836
|
|
|
$
|
119,621
|
|
|
$
|
22,215
|
|
|
(1)
|
Depreciation expense included an incremental $5 million in our Europe segment, principally due to (i) a $6 million increase in depreciation expense from our acquisition of Stahlgruber, partially offset by (ii) a decrease of $2 million related to the impact of foreign currency translation, primarily due to decreases in the euro and pound sterling exchange rates during the six months ended June 30, 2019 compared to the prior year period.
|
(2)
|
The increase in amortization expense primarily reflected an incremental $19 million from our acquisition of Stahlgruber, partially offset by a decrease of $4 million related to the impact of foreign currency translation, principally due to a decrease in the euro exchange rate during the six months ended June 30, 2019 compared to the prior year period.
|
Other expense, net for the six months ended June 30, 2018
|
$
|
64,332
|
|
|
|
Increase (decrease) due to:
|
|
|
|||
Interest expense, net of interest income
|
5,186
|
|
(1)
|
||
Other expense (income), net
|
(7,129
|
)
|
(2)
|
||
Net decrease
|
(1,943
|
)
|
|
||
Other expense, net for the six months ended June 30, 2019
|
$
|
62,389
|
|
|
(1)
|
Additional interest related to (i) a $10 million increase resulting from higher outstanding debt during the six months ended June 30, 2019 compared to the prior year period (including the borrowings under our Euro Notes (2026/28)), partially offset by (ii) a $4 million decrease from lower interest rates on borrowings under our senior secured credit agreement compared to the prior year period, and (iii) a $2 million decrease from foreign currency translation, primarily related to a decrease in the euro exchange rate during the first six months of 2019 compared to the prior year period.
|
(2)
|
The increase in other income primarily consisted of (i) $3 million of proceeds received in the first quarter of 2019 related to an insurance settlement in our North America segment, (ii) a $2 million non-recurring impairment loss recorded during the second quarter of 2018 related to our Andrew Page operation, and (iii) a $2 million favorable variance in foreign currency gains and losses.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2019
|
|
% of Total Segment Revenue
|
|
2018
|
|
% of Total Segment Revenue
|
|
2019
|
|
% of Total Segment Revenue
|
|
2018
|
|
% of Total Segment Revenue
|
||||||||||||
Third Party Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
$
|
1,321,670
|
|
|
|
|
$
|
1,334,965
|
|
|
|
|
$
|
2,623,876
|
|
|
|
|
$
|
2,664,625
|
|
|
|
||||
Europe
|
1,516,240
|
|
|
|
|
1,284,153
|
|
|
|
|
2,961,781
|
|
|
|
|
2,324,583
|
|
|
|
||||||||
Specialty
|
410,263
|
|
|
|
|
411,633
|
|
|
|
|
762,819
|
|
|
|
|
762,307
|
|
|
|
||||||||
Total third party revenue
|
$
|
3,248,173
|
|
|
|
|
$
|
3,030,751
|
|
|
|
|
$
|
6,348,476
|
|
|
|
|
$
|
5,751,515
|
|
|
|
||||
Total Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
$
|
1,321,766
|
|
|
|
|
$
|
1,335,166
|
|
|
|
|
$
|
2,624,075
|
|
|
|
|
$
|
2,665,009
|
|
|
|
||||
Europe
|
1,516,240
|
|
|
|
|
1,284,153
|
|
|
|
|
2,961,781
|
|
|
|
|
2,324,583
|
|
|
|
||||||||
Specialty
|
411,636
|
|
|
|
|
412,873
|
|
|
|
|
765,373
|
|
|
|
|
764,665
|
|
|
|
||||||||
Eliminations
|
(1,469
|
)
|
|
|
|
(1,441
|
)
|
|
|
|
(2,753
|
)
|
|
|
|
(2,742
|
)
|
|
|
||||||||
Total revenue
|
$
|
3,248,173
|
|
|
|
|
$
|
3,030,751
|
|
|
|
|
$
|
6,348,476
|
|
|
|
|
$
|
5,751,515
|
|
|
|
||||
Segment EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
$
|
190,048
|
|
|
14.4
|
%
|
|
$
|
175,010
|
|
|
13.1
|
%
|
|
$
|
366,684
|
|
|
14.0
|
%
|
|
$
|
352,723
|
|
|
13.2
|
%
|
Europe
|
116,281
|
|
|
7.7
|
%
|
|
110,893
|
|
|
8.6
|
%
|
|
221,579
|
|
|
7.5
|
%
|
|
186,427
|
|
|
8.0
|
%
|
||||
Specialty
|
52,367
|
|
|
12.7
|
%
|
|
56,068
|
|
|
13.6
|
%
|
|
90,326
|
|
|
11.8
|
%
|
|
98,037
|
|
|
12.8
|
%
|
|
Three Months Ended June 30,
|
|
Percentage Change in Revenue
|
|||||||||||||||||
North America
|
2019
|
|
2018
|
|
Organic
|
|
Acquisition (3)
|
|
Foreign Exchange
|
|
Total Change
|
|||||||||
Parts & services revenue
|
$
|
1,165,482
|
|
|
$
|
1,165,422
|
|
|
(0.4
|
)%
|
(1
|
)
|
0.6
|
%
|
|
(0.2
|
)%
|
|
0.0
|
%
|
Other revenue
|
156,188
|
|
|
169,543
|
|
|
(8.9
|
)%
|
(2
|
)
|
1.1
|
%
|
|
(0.1
|
)%
|
|
(7.9
|
)%
|
||
Total third party revenue
|
$
|
1,321,670
|
|
|
$
|
1,334,965
|
|
|
(1.4
|
)%
|
|
0.7
|
%
|
|
(0.2
|
)%
|
|
(1.0
|
)%
|
|
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding.
|
(1)
|
Parts and services organic revenue declined 0.4% in the second quarter of 2019 compared to the prior year period. This decline was impacted by (i) lower revenue in our glass and aviation businesses, which had unfavorable effects on organic growth of 0.6% and 0.4%, respectively, and (ii) collision and liability related auto claims being 2.6% lower in the second quarter of 2019 compared to the prior year period, which adversely impacted volume in our wholesale operations. Additionally, our North America segment generated a 7.4% organic growth rate for parts and services revenue in the second quarter of 2018, due in part to severe winter weather conditions, which increased backlog at our customers going into the second quarter. Facing a strong comparable period and with less favorable weather conditions in the first half of 2019, organic parts and services revenue growth was below our historical average.
|
(2)
|
The $15 million year over year organic decrease in other revenue primarily related to (i) a $20 million decrease in revenue from scrap steel and other metals primarily related to lower prices, partially offset by increased volumes, and (ii) a $6 million decrease in core revenue primarily related to decreased volumes, partially offset by (iii) a $10 million increase in revenue from metals found in catalytic converters (platinum, palladium, and rhodium) primarily due to higher prices and, to a lesser extent, increased volumes.
|
(3)
|
Acquisition related growth in the second quarter of 2019 reflected revenue from our acquisition of four wholesale businesses and one self service business since the beginning of the second quarter of 2018 through the one-year anniversary of the acquisitions.
|
(1)
|
The increase in gross margin primarily reflected a favorable impact of 1.2% from our wholesale operations, partially
|
(2)
|
Segment operating expenses as a percentage of revenue were flat year over year despite the negative leverage effect resulting from the $13 million year over year decline in other revenue, as incremental scrap revenue does not require additional overhead costs, such as commissions and delivery costs, thus creating a dilutive impact to margin in periods with declining scrap revenue. Lower personnel related expenses, including reductions in workers compensation claims, third party contract labor costs and overtime costs, helped to offset the negative leverage effect. Additionally, facility expenses increased 0.3% principally related to higher expenses in rent related to expansions and renewals. The offsetting decrease was primarily related to lower bad debt expense of 0.2%, principally due to increased collection efforts. In dollar terms, segment operating expenses were down by $5 million relative to the second quarter of 2018.
|
(3)
|
The decrease in other expense, net and net income attributable to continuing noncontrolling interest was primarily due to several individually immaterial factors that had a favorable impact of 0.2% in the aggregate.
|
|
Three Months Ended June 30,
|
|
Percentage Change in Revenue
|
||||||||||||||||
Europe
|
2019
|
|
2018
|
|
Organic (1)
|
|
Acquisition (2)
|
|
Foreign Exchange (3)
|
|
Total Change
|
||||||||
Parts & services revenue
|
$
|
1,510,952
|
|
|
$
|
1,279,996
|
|
|
(4.3
|
)%
|
|
27.7
|
%
|
|
(5.3
|
)%
|
|
18.0
|
%
|
Other revenue
|
5,288
|
|
|
4,157
|
|
|
9.6
|
%
|
|
24.6
|
%
|
|
(6.9
|
)%
|
|
27.2
|
%
|
||
Total third party revenue
|
$
|
1,516,240
|
|
|
$
|
1,284,153
|
|
|
(4.2
|
)%
|
|
27.6
|
%
|
|
(5.3
|
)%
|
|
18.1
|
%
|
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding.
|
(1)
|
The parts and services organic revenue decline for the quarter was affected by softer economic conditions across the continent. Additionally, we believe the U.K.'s potential exit from the European Union continues to have a negative impact on that market. Warmer weather also negatively impacted some markets. Selling days differ by market, but, on average, we had one fewer selling day in our Europe segment in the second quarter of 2019 than in the prior year period. On a per day basis, organic parts and services revenue declined 2.8%.
|
(2)
|
Acquisition related growth for the three months ended June 30, 2019 was $355 million, or 27.6%, primarily from our acquisition of Stahlgruber.
|
(3)
|
Compared to the prior year, exchange rates decreased our revenue growth by $69 million, or 5.3%, primarily due to the stronger U.S. dollar against the euro, pound sterling and Czech koruna during the second quarter of 2019 relative to the second quarter of 2018.
|
(1)
|
Gross margin was flat year over year primarily due to (i) a 0.5% favorable impact related to an increase in supplier rebates as a result of centralized procurement for our Europe segment, principally driven by our acquisition of Stahlgruber, offset by (ii) unfavorable impacts due to several individually immaterial factors.
|
(2)
|
The increase in segment operating expenses as a percentage of revenue reflects the negative leverage effect resulting from the year over year decline in revenue. Having one fewer selling day in the second quarter of 2019 and a decline in organic revenue (per day) increased the expense as a percentage of revenue of fixed costs, such as personnel salaries and facility rental expenses. The increase in segment operating expenses was primarily due to (i) a 1.0% increase in personnel expenses principally as a result of the negative leverage effect, and (ii) a 0.3% increase in non-recurring European systems and integration costs, including fees related to new information technology and other projects
|
(1)
|
Organic growth in parts and services revenue was roughly flat compared to the prior year second quarter as a result of modest volume growth in both our automotive and RV businesses in the U.S., partially offset by decreased sales volumes in our Canada operations compared to the prior year period, primarily due to softening economic conditions.
|
(1)
|
The decrease in gross margin reflects unfavorable impacts of (i) 0.7% due to unfavorable product mix in the second quarter of 2019, and (ii) 0.6% of higher product costs, primarily due to non-recurring benefits from supplier discounts resulting from strategic purchasing efforts in the fourth quarter of 2017, which had a favorable impact on the second quarter of 2018 as they were recognized over a turn of inventory.
|
(2)
|
The decrease in segment operating expenses reflects favorable impacts of (i) 0.4% in personnel costs primarily due to reduced headcount, and (ii) 0.2% in freight, vehicle and fuel expenses due to a decreased use of third party freight, partially offset by (iii) a 0.2% increase in facility expenses due to higher rent and property taxes as a result of warehouse expansion projects that were completed in the second half of 2018.
|
|
Six Months Ended June 30,
|
|
Percentage Change in Revenue
|
|||||||||||||||||
North America
|
2019
|
|
2018
|
|
Organic
|
|
Acquisition (3)
|
|
Foreign Exchange
|
|
Total Change
|
|||||||||
Parts & services revenue
|
$
|
2,321,180
|
|
|
$
|
2,338,007
|
|
|
(0.9
|
)%
|
(1
|
)
|
0.4
|
%
|
|
(0.3
|
)%
|
|
(0.7
|
)%
|
Other revenue
|
302,696
|
|
|
326,618
|
|
|
(7.8
|
)%
|
(2
|
)
|
0.6
|
%
|
|
(0.1
|
)%
|
|
(7.3
|
)%
|
||
Total third party revenue
|
$
|
2,623,876
|
|
|
$
|
2,664,625
|
|
|
(1.7
|
)%
|
|
0.5
|
%
|
|
(0.3
|
)%
|
|
(1.5
|
)%
|
|
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding.
|
(1)
|
Parts and services organic revenue was negatively impacted by one fewer selling day in the first half of 2019 compared to the prior year period. On a per day basis, organic revenue declined 0.1%. This decline was impacted by (i) lower revenue in our glass and aviation businesses, which had unfavorable effects on organic growth of 0.7% and 0.6%, respectively, and (ii) collision and liability related auto claims being 2.6% lower in the first half of 2019, which adversely impacted volume in our wholesale operations. Additionally, our North America segment generated a 7.0% organic growth rate for parts and services revenue in the first half of 2018, due in part to severe winter weather conditions. Facing a strong comparable period and with less favorable weather conditions in the first half of 2019, organic parts and services revenue growth was below our historical average.
|
(2)
|
The $25 million year over year organic decrease in other revenue primarily related to (i) a $33 million decrease in revenue from scrap steel and other metals primarily related to lower prices, partially offset by increased volumes, and (ii) an $8 million decrease in core revenue primarily related to decreased volumes, partially offset by (iii) a $16 million increase in revenue from metals found in catalytic converters (platinum, palladium, and rhodium) primarily due to higher prices, partially offset by decreased volumes.
|
(3)
|
Acquisition related growth in the first half of 2019 reflected revenue from our acquisition of five wholesale businesses and one self service business from the beginning of 2018 through the one-year anniversary of the acquisitions.
|
(1)
|
The increase in gross margin primarily reflected a favorable impact of 1.2% from our wholesale operations, partially offset by an unfavorable impact of 0.3% from our self service operations. The increase in wholesale gross margin was primarily attributable to ongoing pricing initiatives. The decrease in self service gross margin was primarily attributable to sequential decreases in scrap steel prices as higher cost vehicles were scrapped.
|
(2)
|
The increase in segment operating expenses as a percentage of revenue is primarily related to a 0.4% increase in facility expenses principally due to higher expenses in rent related to expansions and renewals. The increase in segment operating expenses also reflects the negative leverage effect resulting from the year over year decline in revenue. Having one fewer selling day in the first half of 2019 increased the expense as a percentage of revenue of fixed costs, such as facility rental expenses and personnel salaries. The decline in other revenue of $24 million
|
(3)
|
The decrease in other expense, net and net income attributable to continuing noncontrolling interest was due to several individually immaterial factors that had a favorable impact of 0.3% in the aggregate.
|
|
Six Months Ended June 30,
|
|
Percentage Change in Revenue
|
||||||||||||||||
Europe
|
2019
|
|
2018
|
|
Organic (1)
|
|
Acquisition (2)
|
|
Foreign Exchange (3)
|
|
Total Change
|
||||||||
Parts & services revenue
|
$
|
2,951,793
|
|
|
$
|
2,317,042
|
|
|
(1.8
|
)%
|
|
35.4
|
%
|
|
(6.2
|
)%
|
|
27.4
|
%
|
Other revenue
|
9,988
|
|
|
7,541
|
|
|
6.6
|
%
|
|
33.8
|
%
|
|
(7.9
|
)%
|
|
32.4
|
%
|
||
Total third party revenue
|
$
|
2,961,781
|
|
|
$
|
2,324,583
|
|
|
(1.7
|
)%
|
|
35.3
|
%
|
|
(6.2
|
)%
|
|
27.4
|
%
|
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding.
|
(1)
|
Parts and services organic revenue declined for the first half of 2019, primarily affected by softer economic conditions across the continent. Additionally, we believe the U.K.'s potential exit from the European Union continues to have a negative impact on that market. Warmer weather also negatively impacted some markets. Selling days differ by market, but, on average, we had one fewer selling day in our Europe segment in the first half of 2019 than in the prior year period. On a per day basis, organic parts and services revenue declined 0.6%.
|
(1)
|
Acquisition related growth for the six months ended June 30, 2019 was $822 million, or 35.3%, primarily from our acquisition of Stahlgruber.
|
(2)
|
Compared to the prior year, exchange rates decreased our revenue growth by $144 million, or 6.2%, primarily due to the stronger U.S. dollar against the euro, pound sterling and Czech koruna during the first half of 2019 relative to the comparable period of 2018.
|
(1)
|
The increase in gross margin was primarily due to a 0.6% favorable impact related to an increase in supplier rebates as a result of centralized procurement for our Europe segment.
|
(2)
|
The increase in segment operating expenses as a percentage of revenue reflects the negative leverage effect resulting from the year over year decline in revenue. Having one fewer selling day in the first half of 2019 and a decline in organic revenue (per day) increased the expense as a percentage of revenue of fixed costs, such as facility rental expenses and personnel salaries. The increase in segment operating expenses was primarily due to (i) a 1.0% increase in personnel expenses principally as a result of the negative leverage effect, and (ii) a 0.2% increase in non-recurring European systems and integration costs, including fees related to new information technology and other projects related to the integration of the European businesses. The unfavorable effects were partially offset by lower bad debt expense of 0.2%, principally due to increased collection efforts.
|
|
Six Months Ended June 30,
|
|
Percentage Change in Revenue
|
||||||||||||||||
Specialty
|
2019
|
|
2018
|
|
Organic (1)
|
|
Acquisition
|
|
Foreign Exchange
|
|
Total Change
|
||||||||
Parts & services revenue
|
$
|
762,819
|
|
|
$
|
762,307
|
|
|
0.5
|
%
|
|
—
|
%
|
|
(0.4
|
)%
|
|
0.1
|
%
|
Other revenue
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
||
Total third party revenue
|
$
|
762,819
|
|
|
$
|
762,307
|
|
|
0.5
|
%
|
|
—
|
%
|
|
(0.4
|
)%
|
|
0.1
|
%
|
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding.
|
(1)
|
Organic growth in parts and services revenue was primarily due to higher volumes across both our automotive and RV businesses in the U.S., largely due to expansion of our product line coverage, strong exclusive line performance, and continued roll-out of new product applications for new model year vehicles. The organic growth was partially offset by decreased sales volumes in our Canada operations compared to the prior year period, primarily due to softening economic conditions. Organic growth in parts and services revenue for our Specialty segment on a per day basis was 1.3% as there was one fewer selling day in the first half of 2019 compared to the prior year period.
|
(1)
|
The decrease in gross margin reflects unfavorable impacts of (i) 0.7% of higher product costs, primarily due to non-recurring benefits from supplier discounts resulting from strategic purchasing efforts in the fourth quarter of 2017, which had a favorable impact on the first half of 2018 as they were recognized over a turn of inventory, (ii) 0.3% due to unfavorable product mix in the first half of 2019, and (iii) 0.3% due to higher capitalized overhead expenses as a result of warehouse expansion projects that were completed in the second half of 2018.
|
(2)
|
The decrease in segment operating expenses reflects favorable impacts of (i) 0.3% in personnel costs primarily due to reduced headcount and (ii) several individually immaterial factors that had a favorable impact of 0.3% in the aggregate, partially offset by (iii) a 0.2% increase in facility expenses due to higher rent and property taxes as a result of warehouse expansion projects that were completed in the second half of 2018.
|
|
June 30, 2019
|
|
December 31, 2018
|
|
June 30, 2018
|
||||||
Cash and cash equivalents
|
$
|
375,967
|
|
|
$
|
331,761
|
|
|
$
|
345,202
|
|
Total debt (1)
|
4,086,298
|
|
|
4,347,697
|
|
|
4,476,000
|
|
|||
Current maturities (2)
|
132,927
|
|
|
122,117
|
|
|
181,992
|
|
|||
Capacity under credit facilities (3)
|
3,260,000
|
|
|
3,260,000
|
|
|
2,850,000
|
|
|||
Availability under credit facilities (3)
|
1,962,487
|
|
|
1,697,698
|
|
|
1,563,926
|
|
|||
Total liquidity (cash and cash equivalents plus availability under credit facilities)
|
2,338,454
|
|
|
2,029,459
|
|
|
1,909,128
|
|
(1)
|
Debt amounts reflect the gross values to be repaid (excluding debt issuance costs of $34 million as of June 30, 2019, and $37 million as of both December 31, 2018 and June 30, 2018).
|
(2)
|
Debt amounts reflect the gross values to be repaid (excluding debt issuance costs of immaterial amounts as of both June 30, 2019 and December 31, 2018 and $5 million as of June 30, 2018).
|
(3)
|
Capacity under credit facilities includes our revolving credit facilities and our receivables securitization facility. Availability under credit facilities is reduced by our outstanding letters of credit.
|
•
|
Senior secured credit facilities maturing in January 2024, composed of term loans totaling $350 million ($346 million outstanding at June 30, 2019) and $3.15 billion in revolving credit ($1.2 billion outstanding at June 30, 2019), bearing interest at variable rates (although a portion of the outstanding debt is hedged through interest rate swap contracts), with availability reduced by $69 million of amounts outstanding under letters of credit
|
•
|
U.S. Notes (2023) totaling $600 million, maturing in May 2023 and bearing interest at a 4.75% fixed rate
|
•
|
Euro Notes (2024) totaling $569 million (€500 million), maturing in April 2024 and bearing interest at a 3.875% fixed rate
|
•
|
Euro Notes (2026/28) totaling $1.1 billion (€1.0 billion), consisting of (i) €750 million maturing in April 2026 and bearing interest at a 3.625% fixed rate, and (ii) €250 million maturing in April 2028 and bearing interest at a 4.125% fixed rate
|
•
|
Receivables securitization facility with availability up to $110 million (no outstanding balance as of June 30, 2019), maturing in November 2021 and bearing interest at variable commercial paper rates
|
(1)
|
The total debt amounts presented above reflect the gross values to be repaid (excluding debt issuance costs of $34 million as of June 30, 2019).
|
|
Covenant Level
|
|
Ratio Achieved as of June 30, 2019
|
Maximum net leverage ratio
|
4.25:1.00
|
|
2.8
|
Minimum interest coverage ratio
|
3.00:1.00
|
|
9.2
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||||||||||||||
|
|
June 30,
|
|
June 30,
|
|
||||||||||||||||||||
|
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
|
||||||||||||
North America
|
|
$
|
343,300
|
|
|
$
|
363,000
|
|
|
$
|
(19,700
|
)
|
|
$
|
679,400
|
|
|
$
|
721,800
|
|
|
$
|
(42,400
|
)
|
(1)
|
Europe
|
|
982,900
|
|
|
827,100
|
|
|
155,800
|
|
|
1,921,600
|
|
|
1,494,200
|
|
|
427,400
|
|
(2)
|
||||||
Specialty
|
|
287,100
|
|
|
296,600
|
|
|
(9,500
|
)
|
|
537,700
|
|
|
570,600
|
|
|
(32,900
|
)
|
(3)
|
||||||
Total
|
|
$
|
1,613,300
|
|
|
$
|
1,486,700
|
|
|
$
|
126,600
|
|
|
$
|
3,138,700
|
|
|
$
|
2,786,600
|
|
|
$
|
352,100
|
|
|
(1)
|
In North America, aftermarket purchases during the six months ended June 30, 2019 decreased compared to the prior year period primarily as a result of an increased focus on inventory reduction.
|
(2)
|
In our Europe segment, the increase in purchases during the six months ended June 30, 2019 was primarily driven by (i) a $588 million increase attributable to incremental inventory purchases as a result of our acquisition of Stahlgruber in the second quarter of 2018, partially offset by (ii) a $25 million decrease attributable to our continental European operations and a $41 million decrease attributable to our UK operations primarily due to inventory reduction efforts. There was also a decrease of $95 million in inventory purchases attributable to the decrease in the value of the euro and pound sterling in the six months ended June 30, 2019 compared to the prior year period.
|
(3)
|
Specialty inventory purchases decreased $33 million during the six months ended June 30, 2019 compared to the prior year period primarily as a result of an increased focus on inventory reduction.
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||||||||
|
June 30,
|
|
June 30,
|
|
||||||||||||||
|
2019
|
|
2018
|
|
% Change
|
|
2019
|
|
2018
|
|
% Change
|
|
||||||
North America wholesale salvage cars and trucks
|
78
|
|
|
83
|
|
|
(6.0
|
)%
|
|
152
|
|
|
156
|
|
|
(2.6
|
)%
|
|
Europe wholesale salvage cars and trucks
|
6
|
|
|
7
|
|
|
(14.3
|
)%
|
|
14
|
|
|
15
|
|
|
(6.7
|
)%
|
|
Self service and "crush only" cars
|
165
|
|
|
150
|
|
|
10.0
|
%
|
|
304
|
|
|
291
|
|
|
4.5
|
%
|
|
(1)
|
Refer to the Results of Operations - Consolidated section for further information on the decrease in operating income.
|
(2)
|
Non-cash depreciation and amortization expense increased compared to the prior year period as discussed in the Results of Operations - Consolidated section.
|
(3)
|
In the first six months of 2019, we recorded impairment charges on net assets held for sale. See "Net Assets Held for Sale" in Note 4, "Financial Statement Information" to the unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information on the impairment charges.
|
(4)
|
Cash flows related to our primary working capital accounts can be volatile as the purchases, payments and collections can be timed differently from period to period.
|
(5)
|
Reflects a number of individually insignificant fluctuations in cash paid for other operating activities.
|
•
|
foreign exchange rates;
|
•
|
interest rates; and
|
•
|
commodity prices.
|
Period
|
|
Total Number of Shares Purchased
|
|
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
|
||||||
April 1, 2019 - April 30, 2019
|
|
330
|
|
|
$
|
29.88
|
|
|
330
|
|
|
$
|
359,674
|
|
May 1, 2019 - May 31, 2019
|
|
3,320
|
|
|
$
|
27.33
|
|
|
3,320
|
|
|
$
|
268,929
|
|
June 1, 2019 - June 30, 2019
|
|
750
|
|
|
$
|
26.26
|
|
|
750
|
|
|
$
|
249,238
|
|
Total
|
|
4,400
|
|
|
|
|
4,400
|
|
|
|
|
LKQ CORPORATION
|
|
|
|
/s/ Varun Laroyia
|
|
Varun Laroyia
|
|
Executive Vice President and Chief Financial Officer
|
|
(As duly authorized officer and Principal Financial Officer)
|
|
|
|
/s/ Michael S. Clark
|
|
Michael S. Clark
|
|
Vice President - Finance and Controller
|
|
(As duly authorized officer and Principal Accounting Officer)
|
/s/ DOMINICK ZARCONE
|
|
Dominick Zarcone
|
|
President and Chief Executive Officer
|
|
/S/ VARUN LAROYIA
|
|
Varun Laroyia
|
|
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 (15 U.S.C. 78m or 78o(d)); 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/ DOMINICK ZARCONE
|
|
Dominick Zarcone
|
|
President and Chief Executive Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); 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/ VARUN LAROYIA
|
|
Varun Laroyia
|
|
Executive Vice President and Chief Financial Officer
|