Company Quick10K Filing
Lithia Motors
Price131.02 EPS9
Shares23 P/E15
MCap3,066 P/FCF7
Net Debt1,261 EBIT281
TEV4,327 TEV/EBIT15
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-07-24
10-Q 2020-03-31 Filed 2020-04-24
10-K 2019-12-31 Filed 2020-02-21
10-Q 2019-09-30 Filed 2019-10-25
10-Q 2019-06-30 Filed 2019-07-26
10-Q 2019-03-31 Filed 2019-04-26
10-K 2018-12-31 Filed 2019-02-25
10-Q 2018-09-30 Filed 2018-10-26
10-Q 2018-06-30 Filed 2018-07-27
10-Q 2018-03-31 Filed 2018-04-27
10-K 2017-12-31 Filed 2018-02-23
10-Q 2017-09-30 Filed 2017-11-07
10-Q 2017-06-30 Filed 2017-08-02
10-Q 2017-03-31 Filed 2017-04-28
10-K 2016-12-31 Filed 2017-02-28
10-Q 2016-09-30 Filed 2016-10-28
10-Q 2016-06-30 Filed 2016-07-29
10-Q 2016-03-31 Filed 2016-04-29
10-K 2015-12-31 Filed 2016-02-26
10-Q 2015-09-30 Filed 2015-11-02
10-Q 2015-06-30 Filed 2015-07-31
10-Q 2015-03-31 Filed 2015-05-01
10-K 2014-12-31 Filed 2015-03-02
10-Q 2014-09-30 Filed 2014-10-31
10-Q 2014-06-30 Filed 2014-08-08
10-Q 2014-03-31 Filed 2014-04-28
10-K 2013-12-31 Filed 2014-02-21
10-Q 2013-09-30 Filed 2013-10-25
10-Q 2013-06-30 Filed 2013-07-26
10-Q 2013-03-31 Filed 2013-04-26
10-K 2012-12-31 Filed 2013-02-22
10-Q 2012-09-30 Filed 2012-10-26
10-Q 2012-06-30 Filed 2012-07-27
10-Q 2012-03-31 Filed 2012-04-27
10-K 2011-12-31 Filed 2012-02-24
10-Q 2011-09-30 Filed 2011-10-28
10-Q 2011-06-30 Filed 2011-07-29
10-Q 2011-03-31 Filed 2011-04-29
10-K 2010-12-31 Filed 2011-03-07
10-Q 2010-09-30 Filed 2010-10-29
10-Q 2010-06-30 Filed 2010-08-05
10-Q 2010-03-31 Filed 2010-04-30
10-K 2009-12-31 Filed 2010-03-03
8-K 2020-07-24 Other Events, Exhibits
8-K 2020-07-22 Earnings, Other Events, Exhibits
8-K 2020-07-14 Enter Agreement, Off-BS Arrangement, Exhibits
8-K 2020-07-07 Other Events, Exhibits
8-K 2020-06-02
8-K 2020-04-23
8-K 2020-04-22
8-K 2020-04-13
8-K 2020-03-27
8-K 2020-02-12
8-K 2019-12-09
8-K 2019-12-02
8-K 2019-12-02
8-K 2019-10-23
8-K 2019-07-24
8-K 2019-07-16
8-K 2019-04-25
8-K 2019-04-24
8-K 2019-03-01
8-K 2019-02-13
8-K 2019-01-21
8-K 2018-10-24
8-K 2018-07-25
8-K 2018-06-25
8-K 2018-04-27
8-K 2018-04-25

LAD 10Q Quarterly Report

Note 1. Interim Financial Statements
Note 2. Contract Liabilities and Assets
Note 3. Accounts Receivable and Contract Assets
Note 4. Inventories
Note 5. Goodwill and Franchise Value
Note 6. Stockholders' Equity
Note 7. Fair Value Measurements
Note 8. Net Income per Share of Class A and Class B Common Stock
Note 9. Segments
Note 10. Leases
Note 11. Derivative Financial Instruments
Note 12. Acquisitions
Note 13. Recent Accounting Pronouncements
Note 14. Subsequent Events
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-31.1 lad2020q2-10q_ex311.htm
EX-31.2 lad2020q2-10q_ex312.htm
EX-32.1 lad2020q2-10q_ex321.htm
EX-32.2 lad2020q2-10q_ex322.htm

Lithia Motors Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
10.08.06.04.02.00.02012201420172020
Assets, Equity
3.42.72.01.40.70.02012201420172020
Rev, G Profit, Net Income
0.70.40.1-0.1-0.4-0.72012201420172020
Ops, Inv, Fin

Document
false--12-31Q220200001023128LITHIA MOTORS INCus-gaap:AccountingStandardsUpdate201602Memberus-gaap:AccountingStandardsUpdate201613Memberus-gaap:AccountingStandardsUpdate201613Member2843000003092000007300000830000000001000000002500000010000000025000000226000006000002240000040000022600000600000224000004000000.052500.04625P5Yus-gaap:LongTermDebtAndCapitalLeaseObligationsCurrentus-gaap:LongTermDebtAndCapitalLeaseObligationsCurrentus-gaap:LongTermDebtAndCapitalLeaseObligationsus-gaap:LongTermDebtAndCapitalLeaseObligationsP1Yus-gaap:AccruedLiabilitiesCurrentus-gaap:AccruedLiabilitiesCurrent3000003000001800000500000230000040000000150000001500000000 0001023128 2020-01-01 2020-06-30 0001023128 us-gaap:CommonClassBMember 2020-07-24 0001023128 us-gaap:CommonClassAMember 2020-07-24 0001023128 2019-12-31 0001023128 2020-06-30 0001023128 us-gaap:CommonClassBMember 2019-12-31 0001023128 us-gaap:CommonClassAMember 2019-12-31 0001023128 us-gaap:CommonClassBMember 2020-06-30 0001023128 us-gaap:CommonClassAMember 2020-06-30 0001023128 2019-01-01 2019-06-30 0001023128 lad:UsedWholesaleVehicleMember 2019-04-01 2019-06-30 0001023128 lad:UsedRetailVehicleMember 2020-01-01 2020-06-30 0001023128 lad:FleetAndOtherMember 2019-04-01 2019-06-30 0001023128 2020-04-01 2020-06-30 0001023128 lad:FinanceAndInsuranceMember 2019-04-01 2019-06-30 0001023128 2019-04-01 2019-06-30 0001023128 lad:UsedWholesaleVehicleMember 2019-01-01 2019-06-30 0001023128 lad:UsedRetailVehicleMember 2019-01-01 2019-06-30 0001023128 lad:FinanceAndInsuranceMember 2019-01-01 2019-06-30 0001023128 lad:UsedWholesaleVehicleMember 2020-01-01 2020-06-30 0001023128 lad:FleetAndOtherMember 2020-01-01 2020-06-30 0001023128 lad:NewVehicleRetailMember 2019-01-01 2019-06-30 0001023128 lad:NewVehicleRetailMember 2020-04-01 2020-06-30 0001023128 lad:NewVehicleRetailMember 2019-04-01 2019-06-30 0001023128 lad:ServiceBodyAndPartsMember 2020-01-01 2020-06-30 0001023128 lad:UsedWholesaleVehicleMember 2020-04-01 2020-06-30 0001023128 lad:ServiceBodyAndPartsMember 2019-01-01 2019-06-30 0001023128 lad:NewVehicleRetailMember 2020-01-01 2020-06-30 0001023128 lad:ServiceBodyAndPartsMember 2019-04-01 2019-06-30 0001023128 lad:FinanceAndInsuranceMember 2020-01-01 2020-06-30 0001023128 lad:ServiceBodyAndPartsMember 2020-04-01 2020-06-30 0001023128 lad:FleetAndOtherMember 2020-04-01 2020-06-30 0001023128 lad:UsedRetailVehicleMember 2020-04-01 2020-06-30 0001023128 lad:UsedRetailVehicleMember 2019-04-01 2019-06-30 0001023128 lad:FinanceAndInsuranceMember 2020-04-01 2020-06-30 0001023128 lad:FleetAndOtherMember 2019-01-01 2019-06-30 0001023128 us-gaap:RetainedEarningsMember 2020-04-01 2020-06-30 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2020-01-01 2020-03-31 0001023128 us-gaap:RetainedEarningsMember 2020-01-01 2020-03-31 0001023128 2020-01-01 2020-03-31 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2020-04-01 2020-06-30 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2020-06-30 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2019-12-31 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2020-06-30 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2020-03-31 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-12-31 0001023128 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001023128 us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001023128 us-gaap:RetainedEarningsMember 2020-03-31 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2020-03-31 0001023128 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2019-12-31 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2019-12-31 0001023128 2020-03-31 0001023128 us-gaap:AdditionalPaidInCapitalMember 2020-04-01 2020-06-30 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-06-30 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2020-04-01 2020-06-30 0001023128 us-gaap:AdditionalPaidInCapitalMember 2020-06-30 0001023128 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember us-gaap:RetainedEarningsMember 2019-12-31 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-03-31 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-04-01 2020-06-30 0001023128 us-gaap:RetainedEarningsMember 2020-06-30 0001023128 us-gaap:AdditionalPaidInCapitalMember 2020-03-31 0001023128 us-gaap:RetainedEarningsMember 2019-12-31 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-01-01 2020-03-31 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2019-01-01 2019-03-31 0001023128 us-gaap:RetainedEarningsMember 2019-03-31 0001023128 us-gaap:AdditionalPaidInCapitalMember 2019-06-30 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2019-03-31 0001023128 2019-01-01 2019-03-31 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2019-03-31 0001023128 us-gaap:RetainedEarningsMember 2019-04-01 2019-06-30 0001023128 us-gaap:RetainedEarningsMember 2018-12-31 0001023128 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2018-12-31 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2019-06-30 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2019-04-01 2019-06-30 0001023128 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0001023128 2019-06-30 0001023128 us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-03-31 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-03-31 0001023128 us-gaap:RetainedEarningsMember 2019-01-01 2019-03-31 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2019-06-30 0001023128 us-gaap:RetainedEarningsMember 2019-06-30 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2019-01-01 2019-03-31 0001023128 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember us-gaap:RetainedEarningsMember 2018-12-31 0001023128 us-gaap:CommonClassAMember us-gaap:CommonStockMember 2018-12-31 0001023128 us-gaap:AdditionalPaidInCapitalMember 2019-03-31 0001023128 us-gaap:CommonClassBMember us-gaap:CommonStockMember 2018-12-31 0001023128 2018-12-31 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-12-31 0001023128 2019-03-31 0001023128 us-gaap:AdditionalPaidInCapitalMember 2019-04-01 2019-06-30 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-06-30 0001023128 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-04-01 2019-06-30 0001023128 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2020-01-01 0001023128 2020-01-01 0001023128 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember us-gaap:RetainedEarningsMember 2020-01-01 0001023128 lad:ContractsInTransitMember 2019-12-31 0001023128 us-gaap:TradeAccountsReceivableMember 2020-06-30 0001023128 lad:VehicleReceivablesMember 2019-12-31 0001023128 lad:VehicleReceivablesMember 2020-06-30 0001023128 lad:AutoLoansReceivablesMember 2019-12-31 0001023128 lad:ContractsInTransitMember 2020-06-30 0001023128 lad:OtherReceivablesMember 2020-06-30 0001023128 lad:ManufacturerReceivablesMember 2019-12-31 0001023128 lad:ManufacturerReceivablesMember 2020-06-30 0001023128 lad:OtherReceivablesMember 2019-12-31 0001023128 us-gaap:TradeAccountsReceivableMember 2019-12-31 0001023128 lad:AutoLoansReceivablesMember 2020-06-30 0001023128 lad:PartsAndAccessoriesMember 2019-12-31 0001023128 lad:UsedVehicleMember 2019-12-31 0001023128 lad:PartsAndAccessoriesMember 2020-06-30 0001023128 lad:NewVehicleRetailMember 2020-06-30 0001023128 lad:NewVehicleRetailMember 2019-12-31 0001023128 lad:UsedVehicleMember 2020-06-30 0001023128 2019-01-01 2019-12-31 0001023128 2008-12-31 0001023128 lad:DomesticMember 2019-01-01 2019-12-31 0001023128 lad:ImportMember 2020-01-01 2020-06-30 0001023128 lad:LuxuryMember 2019-01-01 2019-12-31 0001023128 lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 lad:LuxuryMember 2019-12-31 0001023128 lad:DomesticMember 2020-01-01 2020-06-30 0001023128 lad:LuxuryMember 2020-06-30 0001023128 lad:ImportMember 2020-06-30 0001023128 lad:DomesticMember 2019-12-31 0001023128 lad:ImportMember 2019-01-01 2019-12-31 0001023128 lad:LuxuryMember 2018-12-31 0001023128 lad:ImportMember 2018-12-31 0001023128 lad:DomesticMember 2018-12-31 0001023128 lad:DomesticMember 2020-06-30 0001023128 lad:ImportMember 2019-12-31 0001023128 us-gaap:CommonClassAMember 2016-02-01 2020-06-30 0001023128 us-gaap:CommonClassAMember 2020-01-01 2020-06-30 0001023128 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonClassAMember 2020-01-01 2020-06-30 0001023128 us-gaap:CommonClassAMember 2018-10-22 0001023128 us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember 2019-12-31 0001023128 us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember 2019-12-31 0001023128 us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember 2019-12-31 0001023128 us-gaap:EstimateOfFairValueFairValueDisclosureMember 2020-06-30 0001023128 lad:SeniorNotesDue2025Member us-gaap:EstimateOfFairValueFairValueDisclosureMember us-gaap:SeniorNotesMember 2019-12-31 0001023128 us-gaap:CarryingReportedAmountFairValueDisclosureMember lad:RealEstateMortgagesAndOtherDebtMember 2019-12-31 0001023128 lad:SeniorNotesDue2025Member us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:SeniorNotesMember 2020-06-30 0001023128 us-gaap:EstimateOfFairValueFairValueDisclosureMember 2019-12-31 0001023128 us-gaap:CarryingReportedAmountFairValueDisclosureMember lad:RealEstateMortgagesAndOtherDebtMember 2020-06-30 0001023128 us-gaap:EstimateOfFairValueFairValueDisclosureMember lad:RealEstateMortgagesAndOtherDebtMember 2019-12-31 0001023128 lad:SeniorNotesDue2027Member us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:SeniorNotesMember 2020-06-30 0001023128 us-gaap:EstimateOfFairValueFairValueDisclosureMember lad:RealEstateMortgagesAndOtherDebtMember 2020-06-30 0001023128 lad:SeniorNotesDue2027Member us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:SeniorNotesMember 2019-12-31 0001023128 lad:SeniorNotesDue2025Member us-gaap:EstimateOfFairValueFairValueDisclosureMember us-gaap:SeniorNotesMember 2020-06-30 0001023128 lad:SeniorNotesDue2025Member us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:SeniorNotesMember 2019-12-31 0001023128 us-gaap:CarryingReportedAmountFairValueDisclosureMember 2019-12-31 0001023128 us-gaap:CarryingReportedAmountFairValueDisclosureMember 2020-06-30 0001023128 lad:SeniorNotesDue2027Member us-gaap:EstimateOfFairValueFairValueDisclosureMember us-gaap:SeniorNotesMember 2019-12-31 0001023128 lad:SeniorNotesDue2027Member us-gaap:EstimateOfFairValueFairValueDisclosureMember us-gaap:SeniorNotesMember 2020-06-30 0001023128 us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember 2020-06-30 0001023128 us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember 2020-06-30 0001023128 us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember 2020-06-30 0001023128 lad:SeniorNotesDue2027Member us-gaap:SeniorNotesMember 2020-06-30 0001023128 lad:SeniorNotesDue2025Member us-gaap:SeniorNotesMember 2020-06-30 0001023128 us-gaap:CommonClassAMember 2020-04-01 2020-06-30 0001023128 us-gaap:CommonClassBMember 2019-04-01 2019-06-30 0001023128 us-gaap:CommonClassAMember 2019-04-01 2019-06-30 0001023128 us-gaap:CommonClassBMember 2020-04-01 2020-06-30 0001023128 us-gaap:CommonClassBMember 2019-01-01 2019-06-30 0001023128 us-gaap:CommonClassAMember 2019-01-01 2019-06-30 0001023128 us-gaap:CommonClassBMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:MaterialReconcilingItemsMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 lad:CorporateAndEliminationsMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 lad:CorporateAndEliminationsMember 2019-04-01 2019-06-30 0001023128 us-gaap:MaterialReconcilingItemsMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 us-gaap:MaterialReconcilingItemsMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 lad:CorporateAndEliminationsMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:DomesticMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:ImportMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 lad:CorporateAndEliminationsMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FleetAndOtherMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:LuxuryMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:DomesticMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:LuxuryMember 2019-01-01 2019-06-30 0001023128 us-gaap:MaterialReconcilingItemsMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:FinanceAndInsuranceMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:DomesticMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:ImportMember 2020-04-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedWholesaleVehicleMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:LuxuryMember 2019-04-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:NewVehicleRetailMember lad:ImportMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:LuxuryMember 2020-01-01 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ServiceBodyAndPartsMember lad:DomesticMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:UsedRetailVehicleMember lad:ImportMember 2019-01-01 2019-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ImportMember 2020-06-30 0001023128 lad:CorporateAndEliminationsMember 2019-12-31 0001023128 lad:CorporateAndEliminationsMember 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:LuxuryMember 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:LuxuryMember 2019-12-31 0001023128 us-gaap:OperatingSegmentsMember lad:DomesticMember 2019-12-31 0001023128 us-gaap:OperatingSegmentsMember lad:DomesticMember 2020-06-30 0001023128 us-gaap:OperatingSegmentsMember lad:ImportMember 2019-12-31 0001023128 srt:MaximumMember 2020-06-30 0001023128 srt:MinimumMember 2020-06-30 0001023128 lad:A2020AcquisitionsMember 2020-01-01 2020-06-30 0001023128 lad:A2020AcquisitionsMember 2020-06-30 0001023128 srt:MaximumMember lad:RealEstateBackedCreditFacilityMember us-gaap:SubsequentEventMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-07-14 2020-07-14 0001023128 lad:RealEstateBackedCreditFacilityMember us-gaap:SubsequentEventMember 2020-07-14 0001023128 lad:RealEstateBackedCreditFacilityMember us-gaap:SubsequentEventMember us-gaap:BaseRateMember 2020-07-14 2020-07-14 0001023128 srt:MinimumMember lad:RealEstateBackedCreditFacilityMember us-gaap:SubsequentEventMember us-gaap:LondonInterbankOfferedRateLIBORMember 2020-07-14 2020-07-14 0001023128 lad:RealEstateBackedCreditFacilityMember us-gaap:SubsequentEventMember 2020-07-14 2020-07-14 xbrli:shares iso4217:USD xbrli:shares iso4217:USD xbrli:pure lad:financial_institution lad:segment lad:Company


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q

(Mark One)
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from       to         
 
Commission file number: 001-14733

 

LITHIA MOTORS, INC.
(Exact name of registrant as specified in its charter)
Oregon
 
93-0572810
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
 
 
 
150 N. Bartlett Street
Medford
Oregon
97501
(Address of principal executive offices)
(Zip Code)
(541) 776-6401
Registrant’s telephone number, including area code
 
 
Securities registered pursuant to Section 12(b) of the Act: 
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Class A common stock without par value
 
LAD
 
The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No
 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
 ☒
 
Accelerated Filer
 ☐
Non-Accelerated Filer
 ☐
 
Smaller Reporting Company
 
 
 
Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

As of July 24, 2020, there were 22,440,945 shares of the registrant’s Class A common stock outstanding and 400,000 shares of the registrant’s Class B common stock outstanding.




LITHIA MOTORS, INC.
FORM 10-Q
INDEX 
 
PART I - FINANCIAL INFORMATION
Page
 
 
 
Item 1.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
PART II - OTHER INFORMATION
 
 
 
 
Item 1.
Legal Proceedings
 
 
 
Item 1A.
 
 
 
Item 2.
 
 
 
Item 6.
 
 
 
 

1



LITHIA MOTORS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In millions)
(Unaudited)
 
 
June 30, 2020
 
December 31, 2019
Assets
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
 
$
120.3

 
$
84.0

Accounts receivable, net of allowance for doubtful accounts of $8.3 and $7.3
 
446.4

 
505.0

Inventories, net
 
1,812.8

 
2,433.7

Other current assets
 
50.6

 
47.8

Total Current Assets
 
2,430.1

 
3,070.5

 
 
 
 
 
Property and equipment, net of accumulated depreciation of $309.2 and $284.3
 
1,663.0

 
1,611.7

Operating lease right-of-use assets
 
234.4

 
251.9

Goodwill
 
592.2

 
454.6

Franchise value
 
355.5

 
306.7

Other non-current assets
 
263.8

 
388.5

Total Assets
 
$
5,539.0

 
$
6,083.9

 
 
 
 
 
Liabilities and Stockholders’ Equity
 
 
 
 
Current Liabilities:
 
 
 
 
Floor plan notes payable
 
$
292.0

 
$
425.2

Floor plan notes payable: non-trade
 
1,168.6

 
1,642.4

Current maturities of long-term debt
 
56.7

 
39.3

Trade payables
 
124.8

 
125.3

Accrued liabilities
 
384.3

 
336.9

Total Current Liabilities
 
2,026.4

 
2,569.1

 
 
 
 
 
Long-term debt, less current maturities
 
1,357.9

 
1,430.6

Deferred revenue
 
145.4

 
137.9

Deferred income taxes
 
123.8

 
131.1

Non-current operating lease liabilities
 
221.6

 
238.5

Other long-term liabilities
 
131.7

 
109.0

Total Liabilities
 
4,006.8

 
4,616.2

 
 
 
 
 
Stockholders’ Equity:
 
 
 
 
Preferred stock - no par value; authorized 15.0 shares; none outstanding
 

 

Class A common stock - no par value; authorized 100.0 shares; issued and outstanding 22.4 and 22.6
 
2.1

 
20.5

Class B common stock - no par value; authorized 25.0 shares; issued and outstanding 0.4 and 0.6
 
0.1

 
0.1

Additional paid-in capital
 
30.1

 
46.0

Accumulated other comprehensive loss
 
(7.2
)
 
(0.7
)
Retained earnings
 
1,507.1

 
1,401.8

Total Stockholders’ Equity
 
1,532.2

 
1,467.7

Total Liabilities and Stockholders’ Equity
 
$
5,539.0

 
$
6,083.9

 
See accompanying condensed notes to consolidated financial statements.

2



LITHIA MOTORS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(In millions, except per share amounts)
(Unaudited)
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
Revenues:
 
 
 
 
 
 
 
 
New vehicle retail
 
$
1,367.8

 
$
1,707.4

 
$
2,741.3

 
$
3,168.5

Used vehicle retail
 
922.2

 
888.3

 
1,796.5

 
1,716.2

Used vehicle wholesale
 
51.3

 
81.7

 
118.0

 
159.1

Finance and insurance
 
124.9

 
129.0

 
246.7

 
246.5

Service, body and parts
 
275.5

 
335.5

 
605.4

 
652.9

Fleet and other
 
16.9

 
79.8

 
54.4

 
128.2

Total revenues
 
2,758.6

 
3,221.7

 
5,562.3

 
6,071.4

Cost of sales:
 
 
 
 
 
 
 
 
New vehicle retail
 
1,275.6

 
1,612.0

 
2,570.9

 
2,987.2

Used vehicle retail
 
823.9

 
795.1

 
1,608.3

 
1,538.4

Used vehicle wholesale
 
49.2

 
79.9

 
115.3

 
156.4

Service, body and parts
 
131.1

 
165.2

 
292.8

 
323.1

Fleet and other
 
14.4

 
75.9

 
49.7

 
122.0

Total cost of sales
 
2,294.2

 
2,728.1

 
4,637.0

 
5,127.1

Gross profit
 
464.4

 
493.6

 
925.3

 
944.3

Asset impairments
 
7.9

 

 
7.9

 
0.5

Selling, general and administrative
 
304.5

 
356.5

 
650.5

 
678.3

Depreciation and amortization
 
22.3

 
20.2

 
44.3

 
40.0

Operating income
 
129.7

 
116.9

 
222.6

 
225.5

Floor plan interest expense
 
(8.1
)
 
(19.4
)
 
(22.1
)
 
(37.5
)
Other interest expense, net
 
(16.8
)
 
(15.0
)
 
(33.8
)
 
(30.3
)
Other income, net
 
3.5

 
3.0

 
5.8

 
5.6

Income before income taxes
 
108.3

 
85.5

 
172.5

 
163.3

Income tax provision
 
(30.6
)
 
(23.6
)
 
(48.6
)
 
(45.0
)
Net income
 
$
77.7

 
$
61.9

 
$
123.9

 
$
118.3

 
 
 
 
 
 
 
 
 
Basic net income per share
 
$
3.40

 
$
2.65

 
$
5.37

 
$
5.10

Shares used in basic per share calculations
 
22.8

 
23.4

 
23.1

 
23.2

 
 
 
 
 
 
 
 
 
Diluted net income per share
 
$
3.38

 
$
2.63

 
$
5.32

 
$
5.08

Shares used in diluted per share calculations
 
23.0

 
23.5

 
23.3

 
23.3

 
 
 
 
 
 
 
 
 
Cash dividends paid per Class A and Class B share
 
$
0.30

 
$
0.30

 
$
0.60

 
$
0.59

 
See accompanying condensed notes to consolidated financial statements.

3



LITHIA MOTORS, INC. AND SUBSIDIARIES
Consolidated Statements of Comprehensive Income
(In millions)
(Unaudited)
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
Net income
 
$
77.7

 
$
61.9

 
$
123.9

 
$
118.3

Other comprehensive loss, net of tax:
 
 
 
 
 

 

Loss on cash flow hedges, net of tax benefit of $0.5, $0.3, $2.3, and $0.3, respectively
 
(1.4
)
 
(0.9
)
 
(6.5
)
 
(0.9
)
Comprehensive income
 
$
76.3

 
$
61.0

 
$
117.4

 
$
117.4

 
See accompanying condensed notes to consolidated financial statements.


4



LITHIA MOTORS, INC. AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders’ Equity
(In millions)
(Unaudited)
Three and Six Months Ended June 30, 2020
 
 Common Stock
 
Additional Paid-In Capital
 
Accumulated Other Comprehensive Loss
 
Retained Earnings
 
Total Stockholders’ Equity
 
 Class A
 
 Class B
 
 
 Shares
 
 Amount
 
 Shares
 
 Amount
 
Balance at December 31, 2019
22.6

 
$
20.5

 
0.6

 
$
0.1

 
$
46.0

 
$
(0.7
)
 
$
1,401.8

 
$
1,467.7

Net income

 

 

 

 

 

 
46.2

 
46.2

Loss on cash flow hedges, net of tax benefit of $1.8

 

 

 

 

 
(5.1
)
 

 
(5.1
)
Issuance of stock in connection with employee stock plans

 
2.6

 

 

 

 

 

 
2.6

Issuance of restricted stock to employees
0.1

 

 

 

 

 

 

 

Repurchase of Class A common stock
(0.5
)
 
(32.0
)
 

 

 
(16.2
)
 

 

 
(48.2
)
Compensation for stock and stock option issuances and excess tax benefits from option exercises

 
8.9

 

 

 
(3.8
)
 

 

 
5.1

Dividends paid

 

 

 

 

 

 
(7.0
)
 
(7.0
)
Adjustment to adopt ASC 326

 

 

 

 

 

 
(4.8
)
 
(4.8
)
Balance at March 31, 2020
22.2

 

 
0.6

 
0.1

 
26.0

 
(5.8
)
 
1,436.2

 
1,456.5

Net income

 

 

 

 

 

 
77.7

 
77.7

Loss on cash flow hedges, net of tax benefit of $0.5

 

 

 

 

 
(1.4
)
 

 
(1.4
)
Issuance of stock in connection with employee stock plans

 
3.5

 

 

 

 

 

 
3.5

Repurchase of Class A common stock

 
(2.3
)
 

 

 

 

 

 
(2.3
)
Class B common stock converted to Class A common stock
0.2

 

 
(0.2
)
 

 

 

 

 

Compensation for stock and stock option issuances and excess tax benefits from option exercises

 
0.9

 

 

 
4.1

 

 

 
5.0

Dividends paid

 

 

 

 

 

 
(6.8
)
 
(6.8
)
Balance as of June 30, 2020
22.4

 
$
2.1

 
0.4

 
$
0.1

 
$
30.1

 
$
(7.2
)
 
$
1,507.1

 
$
1,532.2


 See accompanying condensed notes to consolidated financial statements.

5



LITHIA MOTORS, INC. AND SUBSIDIARIES
Consolidated Statements of Changes in Stockholders’ Equity
(In millions)
(Unaudited)
Three and Six Months Ended June 30, 2019
 
 Common Stock
 
Additional Paid-In Capital
 
Accumulated Other Comprehensive Loss
 
Retained Earnings
 
Total Stockholders’ Equity
 
 Class A
 
 Class B
 
 
 Shares
 
 Amount
 
 Shares
 
 Amount
 
Balance at December 31, 2018
22.0

 
$

 
1.0

 
$
0.1

 
$
35.0

 
$

 
$
1,162.1

 
$
1,197.2

Net income

 

 

 

 

 

 
56.4

 
56.4

Issuance of stock in connection with employee stock plans

 
2.3

 

 

 

 

 

 
2.3

Issuance of restricted stock to employees
0.1

 

 

 

 

 

 

 

Repurchase of Class A common stock

 
(3.1
)
 

 

 

 

 

 
(3.1
)
Class B common stock converted to Class A common stock
0.2

 

 
(0.2
)
 

 

 

 

 

Compensation for stock and stock option issuances and excess tax benefits from option exercises

 
10.5

 

 

 
(7.0
)
 

 

 
3.5

Dividends paid

 

 

 

 

 

 
(6.7
)
 
(6.7
)
Adjustment to adopt ASC 842

 

 

 

 

 

 
0.9

 
0.9

Balance at March 31, 2019
22.3

 
9.7

 
0.8

 
0.1

 
28.0

 

 
1,212.7

 
1,250.5

Net income

 

 

 

 

 

 
61.9

 
61.9

Loss on cash flow hedges, net of tax benefit of $0.3

 

 

 

 

 
(0.9
)
 

 
(0.9
)
Issuance of stock in connection with employee stock plans
0.1

 
2.8

 

 

 

 

 

 
2.8

Compensation for stock and stock option issuances and excess tax benefits from option exercises

 
0.5

 

 

 
3.4

 

 

 
3.9

Option premiums paid

 

 

 

 
(31.4
)
 

 
(5.1
)
 
(36.5
)
Dividends paid

 

 

 

 

 

 
(7.0
)
 
(7.0
)
Balance as of June 30, 2019
22.4

 
$
13.0

 
0.8

 
$
0.1

 
$

 
$
(0.9
)
 
$
1,262.5

 
$
1,274.7


 See accompanying condensed notes to consolidated financial statements.


6



LITHIA MOTORS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In millions)
(Unaudited)
 
 
Six Months Ended June 30,
 
 
2020
 
2019
Cash flows from operating activities:
 
 
 
 
Net income
 
$
123.9

 
$
118.3

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
Asset impairments
 
7.9

 
0.5

Depreciation and amortization
 
44.3

 
40.0

Stock-based compensation
 
10.0

 
7.4

Gain on disposal of other assets
 
(0.3
)
 

(Gain) loss on disposal of franchise
 
(1.4
)
 
0.3

Deferred income taxes
 
(4.9
)
 
7.6

(Increase) decrease (net of acquisitions and dispositions):
 
 
 
 
Accounts receivable, net
 
53.8

 
40.1

Inventories
 
624.7

 
(63.0
)
Other assets
 
(10.6
)
 
6.4

Increase (decrease) (net of acquisitions and dispositions):
 
 
 
 
Floor plan notes payable
 
(130.7
)
 
89.7

Trade payables
 
0.3

 
3.5

Accrued liabilities
 
51.1

 
(8.8
)
Other long-term liabilities and deferred revenue
 
21.9

 
2.4

Net cash provided by operating activities
 
790.0

 
244.4

 
 
 
 
 
Cash flows from investing activities:
 
 
 
 
Capital expenditures
 
(78.3
)
 
(57.8
)
Proceeds from sales of assets
 
1.6

 
0.8

Cash paid for other investments
 
(9.7
)
 
(6.7
)
Cash paid for acquisitions, net of cash acquired
 
(92.3
)
 
(75.0
)
Proceeds from sales of stores
 
11.6

 
28.9

Net cash used in investing activities
 
(167.1
)
 
(109.8
)
 
 
 
 
 
Cash flows from financing activities:
 
 
 
 
Repayments on floor plan notes payable, net: non-trade
 
(456.8
)
 
(11.1
)
Borrowings on lines of credit
 
925.4

 
1,411.0

Repayments on lines of credit
 
(1,034.4
)
 
(1,450.0
)
Principal payments on long-term debt and capital leases, scheduled
 
(13.3
)
 
(12.0
)
Principal payments on long-term debt and capital leases, other
 
(4.9
)
 
(11.0
)
Proceeds from issuance of long-term debt
 
56.5

 

Payments of debt issuance costs
 
(0.9
)
 
(0.2
)
Proceeds from issuance of common stock
 
6.1

 
5.1

Repurchase of common stock
 
(50.5
)
 
(3.1
)
Dividends paid
 
(13.8
)
 
(13.7
)
Other financing activity
 

 
(36.5
)
Net cash used in financing activities
 
(586.6
)
 
(121.5
)
Increase in cash and cash equivalents
 
36.3

 
13.1

Cash and cash equivalents at beginning of period
 
84.0

 
31.6

Cash and cash equivalents at end of period
 
$
120.3

 
$
44.7

 
 
 
 
 
Supplemental disclosure of cash flow information:
 
 
 
 
Cash paid during the period for interest
 
$
61.3

 
$
69.5

Cash paid during the period for income taxes, net
 
4.4

 
7.2

Floor plan debt paid in connection with store disposals
 
22.0

 
4.8

 
 
 
 
 
Supplemental schedule of non-cash activities:
 
 
 
 
Debt issued in connection with acquisitions
 
$

 
$
26.4

ROU assets obtained in exchange for lease liabilities 1
 
$
4.2

 
$
260.3

Acquisition of financing leases
 
$
15.4

 
$

1 The amount for the six months ended June 30, 2019 includes the transition adjustment for the adoption of Topic 842.

 See accompanying condensed notes to consolidated financial statements.

7



LITHIA MOTORS, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 
Note 1. Interim Financial Statements
 
Basis of Presentation
These condensed Consolidated Financial Statements contain unaudited information as of June 30, 2020, and for the three and six months ended June 30, 2020 and 2019. The unaudited interim financial statements have been prepared pursuant to the rules and regulations for reporting on Form 10-Q. Accordingly, certain disclosures required by accounting principles generally accepted in the United States of America for annual financial statements are not included herein. In management’s opinion, these unaudited financial statements reflect all adjustments (which include only normal recurring adjustments) necessary for a fair presentation of the information when read in conjunction with our 2019 audited Consolidated Financial Statements and the related notes thereto. The financial information as of December 31, 2019, is derived from our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 21, 2020. The unaudited interim condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in our 2019 Annual Report on Form 10-K. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the full year.
 
In 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326),” which replaces the existing incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables and held-to-maturity debt securities. It also applies to off-balance sheet credit exposures not accounted for as insurance and net investments in leases recognized by a lessor in accordance with Topic 842 on leases. In addition, Topic 326 made changes to the accounting for available-for-sale debt securities. We adopted Topic 326 using a modified retrospective method for all financial assets measured at amortized cost. Results for reporting periods beginning after January 1, 2020 are presented under Topic 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP.  We recorded a decrease to retained earnings, net of tax, of $4.8 million as of January 1, 2020 for the cumulative effect of adopting Topic 326. The transition adjustment is related to updating our allowance for loan loss methodology related to our auto loan receivables. Our methodology incorporates a combination of historical loan loss experience, current conditions and forecasts, as well as the value of any underlying assets securing the receivables.

In April 2019, the FASB issued ASU 2019-04, “Codification Improvements,” which provides guidance on accounting for credit losses on accrued interest receivable balances and guidance on including recoveries when estimating the allowance. In May 2019, the FASB issued ASU 2019-05, “Targeted Transition Relief,” which allows entities with an option to elect fair value for certain instruments upon adoption of Topic 326.

The impact of adopting Topic 326 on the accompanying Consolidated Balance Sheets as of January 1, 2020 was as follows (in millions):
Impact on Consolidated Balance Sheets
 
December 31, 2019
 
Adjustments
 
January 1, 2020
CECL Adoption:
 
 
 
 
 
 
Accounts receivable, net of allowance for doubtful accounts of $7.3
 
$
505.0

 
$
(