RB Global, Inc. (NYSE & TSX: RBA, the “Company”, “RB
Global”, “we”, “us”, “their”, or “our”) reported the following
results for the three months and year ended December 31, 2024.
“I am proud of everything the RB Global team accomplished in
2024,” said Jim Kessler, CEO of RB Global. “We made significant
progress on our strategic priorities, and we have a firm foundation
by which we expect continued long-term growth and value
creation.”
Commenting on the results, Eric J. Guerin, Chief Financial
Officer, said, “I am pleased with the financial discipline we've
instilled as a team. This past year we have enhanced our
operational efficiency, made strategic investments in long-term
growth opportunities, and significantly reduced our leverage.”
Fourth Quarter Financial Highlights1,2,3:
- Total gross transaction value ("GTV") increased 2% year over
year to $4.1 billion.
- Total revenue increased 10% year over year to $1.1 billion.
- Service revenue increased 8% year over year to $875.5
million.
- Inventory sales revenue increased 15% year over year to $266.1
million.
- Net income increased 41% year over year to $118.4 million.
- Net income available to common stockholders increased 44% year
over year to $107.8 million.
- Diluted earnings per share available to common stockholders
increased 41% to $0.58 per share.
- Diluted adjusted earnings per share available to common
stockholders increased 16% year over year to $0.95 per share.
- Adjusted earnings before interest, taxes, depreciation and
amortization ("EBITDA") increased 13% year over year to $346.0
million.
2025 Financial Outlook The table below outlines the
Company's outlook for select full-year 2025 financial data:
Year ended December 31, 2025
(in U.S. dollars in millions, except
percentages)
Low-End
High-End
GTV growth
0%
3%
Adjusted EBITDA
$1,320
$1,380
Full year tax rate (GAAP and Adjusted)
25%
28%
Capital Expenditures4
$350
$400
Year ended December 31, 2025
The Company has not provided a reconciliation of Adjusted EBITDA
outlook for fiscal 2025 to GAAP net income, the most directly
comparable GAAP financial measure, because without unreasonable
efforts, it is unable to predict with reasonable certainty the
amount or timing of non-GAAP adjustments that are used to calculate
Adjusted EBITDA, including but not limited to: (a) the net loss or
gain on the sale of property plant & equipment or other assets,
(b) acquisition-related or integration costs relating to our
mergers and acquisition activity, including severance costs, (c)
other legal, advisory, restructuring and non-income tax expenses,
(d) share-based payments compensation expense which value is
directly impacted by the fluctuations in our share price and other
variables, and (e) other expenses that we do not believe are
indicative of our ongoing operations. These adjustments are
uncertain, depend on various factors that are beyond our control
and could have a material impact on net income for fiscal 2025.
1 For information regarding RB Global's
use and definition of certain measures, see “Key Operating Metrics”
and “Non-GAAP Measures” sections in this press release.
2 All figures are presented in U.S.
dollars.
3 For the fourth quarter of 2024 as
compared to the fourth quarter of 2023.
4 Capital expenditures is defined as
property, plant and equipment, net of proceeds on disposals, plus
intangible asset additions
Additional Financial and Operational Highlights
(Unaudited)
Three months ended December
31,
Year ended December
31,
% Change
% Change
(in U.S. dollars in millions, except
EPS and
2024 over
2024 over
percentages)
2024
2023
2023
2024
2023
2023
GTV
$ 4,101.2
$ 4,012.0
2 %
$ 15,904.8
$ 13,930.6
14 %
Service revenue
875.5
809.1
8 %
3,363.6
2,732.5
23 %
Service revenue take rate
21.3 %
20.2 %
110bps
21.1 %
19.6 %
150bps
Inventory sales revenue
$ 266.1
$ 231.8
15 %
$ 920.6
$ 947.1
(3) %
Inventory return
15.1
11.6
30 %
56.8
53.5
6 %
Inventory rate
5.7 %
5.0 %
70bps
6.2 %
5.6 %
60bps
Net income
$ 118.4
$ 84.2
41 %
$ 412.8
$ 206.0
100 %
Net income available to common
stockholders
107.8
74.8
44 %
372.7
174.9
113 %
Adjusted EBITDA
346.0
307.5
13 %
1,302.7
1,032.8
26 %
Diluted earnings per share available to
common
stockholders
$ 0.58
$ 0.41
41 %
$ 2.01
$ 1.04
93 %
Diluted adjusted earnings per share
available to
common stockholders
$ 0.95
$ 0.82
16 %
$ 3.49
$ 2.99
17 %
Revenue
Three months ended
December 31,
Year ended December
31,
% Change
% Change
(in U.S. dollars in millions)
2024
2023
2024 over
2023
2024
2023
2024 over
2023
Transactional seller revenue
$ 243.5
$ 244.7
0 %
$ 939.4
$ 851.7
10 %
Transactional buyer revenue
544.8
488.7
11 %
2,067.1
1,593.2
30 %
Marketplace services revenue
87.2
75.7
15 %
357.1
287.6
24 %
Total service revenue
875.5
809.1
8 %
3,363.6
2,732.5
23 %
Inventory sales revenue
266.1
231.8
15 %
920.6
947.1
(3) %
Total revenue
$ 1,141.6
$ 1,040.9
10 %
$ 4,284.2
$ 3,679.6
16 %
In the third quarter of 2024, we also updated our presentation
of disaggregated service revenue to align to how management
evaluates its financial and business performance. The prior year
disaggregation of service revenue amounts have been recast to
conform with current period presentation.
For the Fourth Quarter:
- GTV increased 2% year over year to $4.1 billion with growth
primarily in the automotive sector.
- Service revenue increased 8% year over year to $875.5 million
as a result of a higher average service revenue take rate and
higher GTV. Service revenue take rate expanded 110 basis points
year over year to 21.3% driven by a higher buyer fee rate structure
and growth in marketplace services. Growth in marketplace services
revenue was driven by an increase in transportation services,
primarily in connection with a large consignment contract in the
transportation sector in the United States.
- Inventory sales revenue increased 15% year over year to $266.1
million due to higher revenues from the commercial construction and
transportation sector ("CC&T"). Inventory rate expanded 70
basis points year over year to 5.7%, attributable to stronger
performance primarily in the automotive sector.
- Net income available to common stockholders increased to $107.8
million, primarily driven by higher operating income and lower
interest expense, partially offset by higher income tax
expense.
- Adjusted EBITDA1 increased 13% year over year driven by a
higher service revenue take rate, higher GTV, higher inventory
return, partially offset by higher operating expenses.
GTV by Sector
Three months ended December
31,
Year ended December
31,
% Change
% Change
(in U.S. dollars in millions, except
percentages)
2024
2023
2024 over
2023
2024
2023
2024 over
2023
Automotive
$ 2,133.9
$ 2,046.4
4 %
$ 8,277.6
$ 6,531.2
27 %
CC&T
1,413.7
1,422.8
(1) %
5,805.8
5,446.5
7 %
Other
553.6
542.8
2 %
1,821.4
1,952.9
(7) %
Total GTV
$ 4,101.2
$ 4,012.0
2 %
$ 15,904.8
$ 13,930.6
14 %
Historically, we presented GTV from the sale of parts in our
vehicle dismantling business within our automotive sector and
excluded the number of parts sold from our total lots sold metric.
Commencing in the second quarter of 2024, management has begun to
review the number of parts sold in our vehicle dismantling business
within our other sector and as part of our total lots sold
metric.
Lots Sold by Sector
Three months ended December
31,
Year ended December
31,
% Change
% Change
(in '000's of lots sold, except
percentages)
2024
2023
2024 over
2023
2024
2023
2024 over
2023
Automotive
611.1
572.5
7 %
2,297.2
1,788.4
28 %
CC&T
102.2
86.9
18 %
432.3
314.5
37 %
Other
157.4
155.3
1 %
617.3
591.1
4 %
Total lots
870.7
814.7
7 %
3,346.8
2,694.0
24 %
1 For information regarding RB Global's
use and definition of this measure, see “Key Operating Metrics” and
“Non-GAAP Measures” sections in this press release.
Reconciliation of Operating Expenses (Unaudited)
The below table reconciles as reported operating expenses by
line item to adjusted operating expenses to exclude the impact of
adjustments as defined in our Non-GAAP Measures.
For the three months ended
December 31, 2024
Cost of services
Cost of inventory sold
Selling,
general and administrative
expenses
Acquisition-
related and integration
costs
Depreciation and
amortization
Total operating
expenses
(in U.S. dollars in millions)
As reported (unaudited)
$ 374.2
$251.0
$189.4
$6.1
$114.5
$935.2
Share-based payments expense
—
—
(15.2)
—
—
(15.2)
Acquisition- related and integration
costs
—
—
—
(6.1)
—
(6.1)
Amortization of acquired intangible
assets
—
—
—
—
(68.5)
(68.5)
(Loss) on disposition of property, plant
and equipment and related costs
—
—
(0.7)
—
—
(0.7)
Prepaid consigned vehicle charges
0.7
—
—
—
—
0.7
Other legal, advisory, restructuring and
non-income tax expenses
—
—
(1.0)
—
—
(1.0)
Executive transition costs
—
—
(2.4)
—
—
(2.4)
Adjusted
$ 374.9
$251.0
$170.1
$—
$46.0
$842.0
For the year ended December
31, 2024
(in U.S. dollars in millions)
Cost of services
Cost of inventory sold
Selling,
general and administrative
expenses
Acquisition-
related and integration
costs
Depreciation and
amortization
Total operating
expenses
As reported (unaudited)
$ 1,415.7
$ 863.8
$773.9
$29.0
$444.4
$3,526.8
Share-based payments expense
—
—
(56.3)
—
—
(56.3)
Acquisition- related and integration
costs
—
—
—
(29.0)
—
(29.0)
Amortization of acquired intangible
assets
—
—
—
—
(274.9)
(274.9)
(Loss) gain on disposition of property,
plant and equipment and related costs
—
—
(2.7)
—
—
(2.7)
Prepaid consigned vehicle charges
4.7
—
—
—
—
4.7
Other legal, advisory, restructuring and
non-income tax expenses
—
—
(9.3)
—
—
(9.3)
Executive transition costs
—
—
(6.7)
—
—
(6.7)
Remeasurements in connection with business
combination
—
—
(1.2)
—
—
(1.2)
Adjusted
$ 1,420.4
$863.8
$697.7
$—
$169.5
$3,151.4
Upcoming Investor Events
RB Global will participate in the following investor conferences
in the first quarter:
- Raymond James Institutional Investor Conference, March 4 and 5,
Orlando, United States
Fourth Quarter and Full Year 2024 Earnings Conference
Call RB Global is hosting a conference call to discuss its
financial results for the quarter ended December 31, 2024 at 4:30
PM ET on February 18, 2025. The replay of the webcast will be
available through February 1, 2026.
Conference call and webcast details are available at the
following link: https://investor.rbglobal.com
About RB Global RB Global, Inc. (NYSE: RBA) (TSX: RBA) is
a leading, omnichannel marketplace that provides value-added
insights, services and transaction solutions for buyers and sellers
of commercial assets and vehicles worldwide. Through our auction
sites and digital platform, we have a wide global presence and
serve customers across a variety of asset classes, including
automotive, commercial transportation, construction, government
surplus, lifting and material handling, energy, mining and
agriculture. Our marketplace brands include Ritchie Bros., the
world's largest auctioneer of commercial assets and vehicles
offering online bidding, and IAA, Inc. ("IAA"), a leading global
digital marketplace connecting vehicle buyers and sellers. Our
portfolio of brands also includes Rouse Services ("Rouse"), which
provides a complete end-to-end asset management, data-driven
intelligence and performance benchmarking system; SmartEquip Inc.
("SmartEquip"), an innovative technology platform that supports
customers' management of the equipment lifecycle and integrates
parts procurement with both OEMs and dealers; and VeriTread LLC
("VeriTread"), an online marketplace for heavy haul transport.
Forward-looking Statements This news release contains
forward-looking statements and forward-looking information within
the meaning of applicable US and Canadian securities legislation
(collectively, “forward-looking statements”), including, in
particular, statements regarding future financial and operational
results, opportunities, and any other statements regarding events
or developments that RB Global believes or anticipates will or may
occur in the future. Forward-looking statements are statements that
are not historical facts and are generally, although not always,
identified by words such as “expect”, “plan”, “anticipate”,
“project”, “target”, “potential”, “schedule”, “forecast”, “budget”,
“estimate”, “intend” or “believe” and similar expressions or their
negative connotations, or statements that events or conditions
“will”, “would”, “may”, “could”, “should” or “might” occur. All
such forward-looking statements are based on the opinions and
estimates of management as of the date such statements are made.
Forward-looking statements necessarily involve assumptions, risks
and uncertainties, certain of which are beyond RB Global’s control,
including risks and uncertainties related to: the effects of the
business combination with IAA, including the Company’s future
financial condition, results of operations, strategy and plans;
potential adverse reactions or changes to business or employee
relationships, including those resulting from the completion of the
merger; the diversion of management time on transaction-related
issues; the response of competitors to the merger; the ultimate
difficulty, timing, cost and results of integrating the operations
of IAA; the fact that operating costs and business disruption may
be greater than expected; the effect of the consummation of the
merger on the trading price of RB Global's common shares; the
ability of RB Global to retain and hire key personnel and
employees; the significant costs associated with the merger; the
outcome of any legal proceedings that have been or could be
instituted against RB Global; the ability of the Company to realize
anticipated synergies in the amount, manner or timeframe expected
or at all; the failure of the Company to achieve expected operating
results in the amount, manner or timeframe expected or at all;
changes in capital markets and the ability of the Company to
generate cash flow and/or finance operations in the manner expected
or to de- lever in the timeframe expected; the failure of RB Global
or the Company to meet financial forecasts and/or KPI targets; the
Company’s ability to commercialize new platform solutions and
offerings; legislative, regulatory and economic developments
affecting the combined business; general economic and market
developments and conditions; the evolving legal, regulatory and tax
regimes under which RB Global operates; unpredictability and
severity of catastrophic events, including, but not limited to,
pandemics, acts of terrorism or outbreak of war or hostilities, as
well as RB Global’s response to any of the aforementioned factors.
Other risks that could cause actual results to differ materially
from those described in the forward-looking statements are included
in RB Global's periodic reports and other filings with the
Securities and Exchange Commission (“SEC”) and/or applicable
Canadian securities regulatory authorities, including the risk
factors identified under Item 1A “Risk Factors” and the section
titled “Summary of Risk Factors” in RB Global’s most recent Annual
Report on Form 10-K for the fiscal year ended December 31, 2023,
and RB Global’s periodic reports and other filings with the SEC,
which are available on the SEC, SEDAR and RB Global’ websites. The
foregoing list is not exhaustive of the factors that may affect RB
Global’s forward-looking statements. There can be no assurance that
forward- looking statements will prove to be accurate, and actual
results may differ materially from those expressed in, or implied
by, these forward-looking statements. Forward-looking statements
are made as of the date of this news release and RB Global does not
undertake any obligation to update the information contained herein
unless required by applicable securities legislation. For the
reasons set forth above, you should not place undue reliance on
forward-looking statements.
Key Operating Metrics
We regularly review a number of metrics, including the following
key operating metrics, to evaluate our business, measure our
performance, identify trends affecting our business, and make
operating decisions. We believe these key operating metrics are
useful to investors because management uses these metrics to assess
the growth of our business and the effectiveness of our operational
strategies.
We define our key operating metrics as follows:
GTV: Represents total proceeds from all items sold at the
Company’s auctions and online marketplaces. GTV is not a measure of
financial performance, liquidity, or revenue, and is not presented
in the Company’s consolidated financial statements.
Inventory return: Inventory sales revenue less cost of
inventory sold.
Inventory rate: Inventory return divided by inventory
sales revenue.
Total lots sold: A single asset to be sold, or a group of
assets bundled for sale as one unit. Low value assets are sometimes
bundled into a single lot, collectively referred to as “small value
lots.”
Total service revenue take rate: Total service revenue
divided by total GTV.
GTV and Selected Condensed Consolidated
Financial Information
GTV and Condensed Consolidated Income
Statements
(Expressed in millions of U.S. dollars,
except share, per share data and percentages)
(Unaudited)
Three months ended December
31,
Year ended December
31,
2024
2023
2024
2023
GTV
$
4,101.2
$
4,012.0
$
15,904.8
$
13,930.6
Revenue:
Service revenue
$
875.5
$
809.1
$
3,363.6
$
2,732.5
Inventory sales revenue
266.1
231.8
920.6
947.1
Total revenue
1,141.6
1,040.9
4,284.2
3,679.6
Operating expenses:
Costs of services
374.2
327.1
1,415.7
1,007.6
Cost of inventory sold
251.0
220.2
863.8
893.6
Selling, general and administrative
189.4
197.5
773.9
743.7
Acquisition-related and integration
costs
6.1
20.5
29.0
216.1
Depreciation and amortization
114.5
105.3
444.4
352.2
Total operating expenses
935.2
870.6
3,526.8
3,213.2
Gain on disposition of property, plant and
equipment
0.6
0.5
3.8
4.9
Operating income
207.0
170.8
761.2
471.3
Interest expense
(52.7
)
(64.2
)
(233.7
)
(213.8
)
Interest income
5.9
6.2
26.2
22.0
Other income (loss), net
0.5
1.7
(1.7
)
4.7
Foreign exchange (loss) gain
(0.3
)
(0.4
)
(1.9
)
(1.8
)
Income before income taxes
160.4
114.1
550.1
282.4
Income tax expense
42.0
29.9
137.3
76.4
Net income
$
118.4
$
84.2
$
412.8
$
206.0
Net income attributable to:
Controlling interests
$
118.5
$
84.3
$
413.1
$
206.5
Redeemable non-controlling interests
(0.1
)
(0.1
)
(0.3
)
(0.5
)
Net income
$
118.4
$
84.2
$
412.8
$
206.0
Net income attributable to controlling
interests
$
118.5
$
84.3
$
413.1
$
206.5
Cumulative dividends on Series A Senior
Preferred Shares
(6.7
)
(6.7
)
(26.7
)
(24.3
)
Allocated earnings to Series A Senior
Preferred Shares
(4.0
)
(2.8
)
(13.7
)
(7.3
)
Net income available to common
stockholders
$
107.8
$
74.8
$
372.7
$
174.9
Earnings per share available to common
stockholders:
Basic
$
0.58
$
0.41
$
2.03
$
1.05
Diluted
$
0.58
$
0.41
$
2.01
$
1.04
Weighted average number of shares
outstanding:
Basic
184,571,029
182,509,436
183,958,258
166,963,575
Diluted
186,014,058
183,895,313
185,254,557
168,203,981
Condensed Consolidated Balance
Sheets
(Expressed in millions of U.S. dollars,
except share data)
(Unaudited)
December 31,
December 31,
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
533.9
$
576.2
Restricted cash
174.9
171.7
Trade and other receivables, net of
allowance for credit losses of $4.9 and $3.3 respectively
709.4
731.5
Prepaid consigned vehicle charges
67.9
66.9
Inventory
121.5
166.5
Other current assets
77.0
91.2
Income taxes receivable
30.2
10.0
Total current assets
1,714.8
1,814.0
Property, plant and equipment, net
1,275.4
1,200.9
Operating lease right-of-use assets
1,529.1
1,475.5
Other non-current assets
98.4
85.6
Intangible assets, net
2,668.7
2,914.1
Goodwill
4,511.8
4,537.0
Deferred tax assets
8.8
10.3
Total assets
$
11,807.0
$
12,037.4
Liabilities, Temporary Equity and
Stockholders' Equity
Current liabilities:
Auction proceeds payable
$
378.0
$
502.5
Trade and other liabilities
782.0
685.8
Current operating lease liabilities
113.3
118.0
Income taxes payable
26.2
8.5
Short-term debt
27.7
13.7
Current portion of long-term debt
4.1
14.2
Total current liabilities
1,331.3
1,342.7
Long-term operating lease liabilities
1,431.1
1,354.3
Long-term debt
2,622.1
3,061.6
Other non-current liabilities
97.4
86.7
Deferred tax liabilities
608.7
682.7
Total liabilities
6,090.6
6,528.0
Temporary equity:
Series A Senior Preferred Shares; shares
authorized, issued and outstanding: 485,000,000
(December 31, 2023: 485,000,000)
482.0
482.0
Redeemable non-controlling interest
8.1
8.4
Stockholders' equity:
Senior preferred and junior preferred
stock, unlimited shares authorized; shares issued and outstanding,
other than Series A Senior Preferred Shares: nil (December 31,
2023: nil)
—
—
Common stock; no par value, unlimited
shares authorized, issued and outstanding shares:
184,732,582 (December 31, 2023:
182,843,942)
4,163.1
4,054.2
Additional paid-in capital
95.4
88.0
Retained earnings
1,090.3
918.5
Accumulated other comprehensive loss
(124.8
)
(44.0
)
Stockholders' equity
5,224.0
5,016.7
Non-controlling interests
2.3
2.3
Total stockholders' equity
5,226.3
5,019.0
Total liabilities, temporary equity and
stockholders' equity
$
11,807.0
$
12,037.4
Condensed Consolidated Statements of
Cash Flows
(Expressed in millions of U.S.
dollars)
(Unaudited)
Year ended December 31,
2024
2023
Cash provided by (used in):
Operating activities:
Net income
$
412.8
$
206.0
Adjustments for items not affecting
cash:
Depreciation and amortization
444.4
352.2
Share-based payments expense
62.4
55.8
Deferred income tax benefit
(69.2
)
(65.8
)
Unrealized foreign exchange (gain)
loss
(0.4
)
6.6
Gain on disposition of property, plant and
equipment
(3.8
)
(4.9
)
Allowance for expected credit losses
5.1
5.9
Loss on redemption of notes
—
3.3
Gain on remeasurement of investment upon
acquisition
—
(1.4
)
Amortization of debt issuance costs
12.5
10.1
Amortization of right-of-use assets
154.4
109.9
Inventory write-downs
14.9
7.0
Other, net
(1.3
)
3.0
Net changes in operating assets and
liabilities
(99.8
)
(143.7
)
Net cash provided by operating
activities
932.0
544.0
Investing activities:
Acquisition of IAA, net of cash
acquired
—
(2,753.9
)
Acquisition of VeriTread, net of cash
acquired
—
(24.7
)
Acquisition of Boom and Bucket, net of
cash acquired
(8.6
)
—
Property, plant and equipment
additions
(167.4
)
(227.9
)
Proceeds on disposition of property, plant
and equipment
2.6
32.6
Intangible asset additions
(109.5
)
(118.3
)
Repayment of loans receivable
8.1
4.0
Issuance of loans receivable
(24.1
)
(18.8
)
Other, net
(2.7
)
(1.3
)
Net cash (used in) provided by investing
activities
(301.6
)
(3,108.3
)
Financing activities:
Issuance of Series A Senior Preferred
Shares and common stock, net of issuance costs
—
496.9
Dividends paid to common stockholders
(206.0
)
(298.0
)
Acquisition of remaining interest in NCI
and dividends paid to NCI
—
—
Dividends paid to Series A Senior
Preferred shareholders
(34.2
)
(30.4
)
Proceeds from exercise of options and
share option plans
75.5
43.7
Payment of withholding taxes on issuance
of shares
(14.8
)
(15.9
)
Net increase (decrease) in short-term
debt
14.5
(15.5
)
Proceeds from long-term debt
—
3,175.0
Repayment of long-term debt
(454.4
)
(654.4
)
Payment of debt issue costs
(0.3
)
(41.7
)
Repayment of finance lease and equipment
financing obligations
(26.5
)
(19.2
)
Proceeds of equipment financing
obligations
2.6
37.6
Payment of contingent consideration
(1.9
)
(1.9
)
Net cash (used in) provided by financing
activities
(645.5
)
2,676.2
Effect of changes in foreign currency
rates on cash, cash equivalents, and restricted cash
(24.0
)
10.1
Net (decrease) increase in cash, cash
equivalents, and restricted cash
(39.1
)
122.0
Cash, cash equivalents, and restricted
cash, beginning of period
747.9
625.9
Cash, cash equivalents, and restricted
cash, end of period
$
708.8
$
747.9
Non-GAAP Measures (Unaudited)
This news release references non-GAAP measures. These measures
do not have a standardized meaning and are, therefore, unlikely to
be comparable to similar measures presented by other companies. The
presentation of this financial information, which is not prepared
under any comprehensive set of accounting rules or principles, is
not intended to be considered in isolation of, or as a substitute
for, the financial information prepared and presented in accordance
with US GAAP.
Adjusted Net Income Available to Common Stockholders and
Diluted Adjusted EPS Available to Common Stockholders
Reconciliation The Company believes that adjusted net income
available to common stockholders provides useful information about
the growth or decline of the net income available to common
stockholders for the relevant financial period and eliminates the
financial impact of adjusting items the Company does not consider
to be part of the normal operating results. Diluted adjusted EPS
available to common stockholders eliminates the financial impact of
adjusting items from net income available to common stockholders
that the Company does not consider to be part of the normal
operating results.
Adjusted net income available to common stockholders is
calculated as net income available to common stockholders,
excluding the effects of adjusting items that we do not consider to
be part of our normal operating results, such as share- based
payments expense, acquisition-related and integration costs,
amortization of acquired intangible assets, executive transition
costs and certain other items.
Net income available to common stockholders is calculated as net
income attributable to controlling interests, less cumulative
dividends on Series A Senior Preferred Shares and allocated
earnings to participating securities.
Diluted adjusted EPS available to common stockholders is
calculated by dividing adjusted net income available to common
stockholders by the weighted average number of dilutive shares
outstanding, except that it is computed based upon the lower of the
two-class method or the if-converted method, which includes the
effects of the assumed conversion of the Series A Senior Preferred
Shares and the effect of shares issuable under the Company’s
stock-based incentive plans, if such effect is dilutive.
The following table reconciles adjusted net income available to
common stockholders and diluted adjusted EPS available to common
stockholders to net income available to common stockholders and
diluted EPS available to common stockholders, which are the most
directly comparable GAAP measures in our consolidated financial
statements:
Three months ended December
31,
Year ended December
31,
% Change
%Change
(in U.S. dollars in millions, except
share, per share data, and percentages)
2024
2023
2024 over
2023
2024
2023
2024 over
2023
Net income available to common
stockholders
$
107.8
$
74.8
44
%
$
372.7
$
174.9
113
%
Share-based payments expense
15.2
13.8
10
%
56.3
45.5
24
%
Acquisition-related and integration
costs
6.1
20.5
(70
)%
29.0
216.1
(87
)%
Amortization of acquired intangible
assets
68.5
69.6
(2
)%
274.9
226.2
22
%
(Gain) loss on disposition of property,
plant and equipment and related costs
—
0.2
NM
(1.2
)
(0.8
)
50
%
Prepaid consigned vehicle charges
(0.7
)
(7.3
)
(90
)%
(4.7
)
(67.0
)
(93
)%
Loss on redemption of the 2016 and 2021
Notes and certain related interest expense
—
—
NM
—
3.3
NM
Other legal, advisory, restructuring and
non- income tax expenses
1.3
0.7
86
%
13.4
2.0
570
%
Executive transition costs
2.4
2.2
9
%
6.7
12.0
(44
)%
Remeasurements in connection with business
combinations
—
0.1
NM
1.2
(2.9
)
NM
Related tax effects of the above
(21.5
)
(21.2
)
1
%
(91.4
)
(95.8
)
(5
)%
Related allocation of the above to
participating securities
(2.5
)
(2.8
)
(11
%
(10.1
)
(11.3
)
(11
%
Adjusted net income available to common
stockholders
$
176.6
$
150.6
17
%
$
646.8
$
502.2
29
%
Weighted average number of dilutive shares
outstanding
186,014,058
183,895,313
1
%
185,254,557
168,203,981
10
%
Diluted earnings per share available to
common stockholders
$
0.58
$
0.41
41
%
$
2.01
$
1.04
93
%
Diluted adjusted earnings per share
available to
common stockholders
$
0.95
$
0.82
16
%
$
3.49
$
2.99
17
%
NM - Not meaningful
Adjusted EBITDA The Company believes adjusted EBITDA
provides useful information about the growth or decline of its net
income when compared between different financial periods. The
Company uses adjusted EBITDA as a key performance measure because
the Company believes it facilitates operating performance
comparisons from period to period and provides management with the
ability to monitor its controllable incremental revenues and
costs.
Adjusted EBITDA is calculated by adding back depreciation and
amortization, interest expense, income tax expense, and subtracting
interest income from net income, as well as adding back the
adjusting items.
The following table reconciles adjusted EBITDA to net income,
which is the most directly comparable GAAP measure in, or
calculated from, our consolidated financial statements:
Three months ended December
31,
Year ended December
31,
% Change
% Change
(in U.S. dollars in millions, except
percentages)
2024
2023
2024 over
2023
2024
2023
2024 over
2023
Net income
$
118.4
$
84.2
41
%
$
412.8
$
206.0
100
%
Add: depreciation and amortization
114.5
105.3
9
%
444.4
352.2
26
%
Add: interest expense
52.7
64.2
(18
)%
233.7
213.8
9
%
Less: interest income
(5.9
)
(6.2
)
(5
)%
(26.2
)
(22.0
)
19
%
Add: income tax expense
42.0
29.9
40
%
137.3
76.4
80
%
EBITDA
321.7
277.4
16
%
1,202.0
826.4
45
%
Share-based payments expense
15.2
13.8
10
%
56.3
45.5
24
%
Acquisition-related and integration
costs
6.1
20.5
(70
)%
29.0
216.1
(87
)%
(Gain) loss on disposition of property,
plant and equipment and related costs
—
0.2
NM
(1.2
)
(0.8
)
50
%
Prepaid consigned vehicle charges
(0.7
)
(7.3
)
(90
)%
(4.7
)
(67.0
)
(93
)%
Other legal, advisory, restructuring and
non- income tax expenses
1.3
0.7
86
%
13.4
2.0
570
%
Executive transition costs
2.4
2.2
9
%
6.7
12.0
(44
)%
Remeasurements in connection with business
combinations
—
—
NM
1.2
(1.4
)
NM
Adjusted EBITDA
$
346.0
$
307.5
13
%
$
1,302.7
$
1,032.8
26
%
NM - Not meaningful
Adjusted Net Debt and Adjusted Net Debt/Adjusted EBITDA
Reconciliation The Company believes that comparing adjusted net
debt/adjusted EBITDA on a trailing twelve-month basis for different
financial periods provides useful information about the performance
of its operations as an indicator of the amount of time it would
take to settle both the Company’s short and long-term debt. The
Company does not consider this to be a measure of its liquidity,
which is its ability to settle only short-term obligations, but
rather a measure of how well it funds liquidity.
Adjusted net debt is calculated by subtracting cash and cash
equivalents from short and long-term debt and long-term debt in
escrow. Adjusted net debt/Adjusted EBITDA is calculated by dividing
adjusted net debt by adjusted EBITDA.
The following table reconciles adjusted net debt to debt,
adjusted EBITDA to net income, and adjusted net debt/ adjusted
EBITDA to debt/ net income, respectively, which are the most
directly comparable GAAP measures in, or calculated from, our
consolidated financial statements.
Year ended December
31,
(in U.S. dollars in millions, except
percentages)
2024
2023
% Change
2024 over 2023
Short-term debt
$
27.7
$
13.7
102
%
Long-term debt
2,626.2
3,075.8
(15
)%
Debt
2,653.9
3,089.5
(14
)%
Less: cash and cash equivalents
(533.9
)
(576.2
)
(7
)%
Adjusted net debt
2,120.0
2,513.3
(16
)%
Net income
$
412.8
$
206.0
100
%
Add: depreciation and amortization
444.4
352.2
26
%
Add: interest expense
233.7
213.8
9
%
Less: interest income
(26.2
)
(22.0
)
19
%
Add: income tax expense
137.3
76.4
80
%
EBITDA
1,202.0
826.4
45
%
Share-based payments expense
56.3
45.5
24
%
Acquisition-related and integration
costs
29.0
216.1
(87
)%
(Gain) loss on disposition of property,
plant and equipment and related costs
(1.2
)
(0.8
)
50
%
Prepaid consigned vehicle charges
(4.7
)
(67.0
)
(93
)%
Other legal, advisory, restructuring and
non-income tax expenses
13.4
2.0
570
%
Executive transition costs
6.7
12.0
(44
)%
Remeasurements in connection with business
combinations
1.2
(1.4
)
NM
Adjusted EBITDA
$
1,302.7
$
1,032.8
26
%
Debt/net income
6.4 x
15.0 x
(57
)%
Adjusted net debt/adjusted EBITDA
1.6 x
2.4 x
(33
)%
NM - Not meaningful
Adjusting items for the year ended December 31, 2024:
Recognized in the fourth quarter of 2024
- $15.2 million share-based payments expense.
- $6.1 million of acquisition-related and integration costs,
primarily relating to severance and integration activities in
connection with the acquisition of IAA.
- $68.5 million amortization of acquired intangible assets from
acquisitions.
- $0.7 million relating to a fair value adjustment made to the
prepaid consigned vehicle charges on the opening balance sheet of
IAA at acquisition.
- $1.3 million of other legal, advisory, restructuring and
non-income tax expenses, including costs incurred with the Canada
Revenue Agency's dispute.
- $2.4 million of estimated executive transition costs, primarily
estimated settlement and legal amounts associated with the
departure of our former CEO on August 1, 2023.
Recognized in the third quarter of 2024
- $9.7 million share-based payments expense.
- $6.0 million of acquisition-related and integration costs,
primarily relating to the acquisition of IAA.
- $67.9 million amortization of acquired intangible assets from
past acquisitions.
- $0.2 million loss on disposition of property, plant and
equipment and related costs, primarily driven by non-cash costs
arising from the accounting for the sale of the Bolton property,
recorded in selling, general and administrative cost, partially
offset by a $0.5 million gain on the disposition of property, plant
and equipment.
- $0.6 million relating to a fair value adjustment made to the
prepaid consigned vehicle charges on the opening balance sheet of
IAA at acquisition.
- $2.2 million of other legal, advisory, restructuring and
non-income tax expenses, which primarily includes an estimated
accrual for the settlement amount of an unusual legal claim
recorded in other income (loss), as well as terminated and ongoing
transaction costs recorded in selling, general and administrative
costs.
- $0.6 million of estimated executive transition costs, primarily
legal costs, associated with the departure of our former CEO on
August 1, 2023.
- $1.2 million of remeasurements in connection with a business
combination which relates to the revaluation of a contingent
consideration liability for IAA's acquisition of Marisat, Inc. in
2021.
Recognized in the second quarter of 2024
- $18.1 million share-based payments expense.
- $4.1 million of acquisition-related and integration costs,
primarily relating to the acquisition of IAA.
- $69.0 million amortization of acquired intangible assets from
past acquisitions.
- $0.4 million loss on disposition of property, plant and
equipment and related costs, primarily driven by non-cash costs
arising from the accounting for the sale of the Bolton property,
recorded in selling, general and administrative costs.
- $1.3 million relating to a fair value adjustment made to the
prepaid consigned vehicle charges on the opening balance sheet of
IAA at acquisition.
- $7.7 million of other legal, advisory, restructuring and
non-income tax expenses, which includes an estimated accrual for a
new digital services tax in Canada on certain in-scope revenues
earned for the period from January 1, 2022 to June 30, 2024, legal
costs in connection with the settlement of an unusual legal claim
accrued in the first quarter of 2024, as well as terminated and
ongoing transaction costs.
- $2.0 million of estimated executive transition costs associated
with the departure of our former CEO on August 1, 2023, which
includes estimated settlement amounts and related costs.
Recognized in the first quarter of 2024
- $13.3 million share-based payments expense.
- $12.8 million of acquisition-related and integration costs
primarily relating to the acquisition of IAA.
- $69.6 million amortization of acquired intangible assets from
past acquisitions, of which $61.9 million related to the acquired
intangible assets from the acquisition of IAA.
- $1.8 million gain on disposition of property, plant and
equipment and related costs, primarily driven by a $2.2 million
gain on a lease modification, offset by non-cash costs arising from
the accounting for the sale of the Bolton property, recorded in
selling, general and administrative costs.
- $2.1 million relating to a fair value adjustment made to the
prepaid consigned vehicle charges on the opening balance sheet of
IAA, which do not have a future benefit at acquisition, and
therefore has created a favorable reduction to our cost of services
in the quarter.
- $2.2 million of other advisory, legal and restructuring costs,
which primarily includes a $1.9 million loss on the settlement of
an unusual legal claim recorded in other income, $0.3 million of
terminated and ongoing transaction costs and $0.1 million of costs
incurred with the CRA's investigation.
- $1.7 million of estimated executive transition costs associated
with the departures of certain executives on August 1, 2023, which
includes severance, estimated settlement amounts and related
costs.
The adjusting items recognized in our prior quarters are
discussed in "Part II, Item 7: Management’s Discussion and Analysis
of Financial Condition and Results of Operations” of our Annual
Report on Form 10-K for the year ended December 31, 2023.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250218757724/en/
For further information, please contact: Sameer Rathod |
Vice President, Investor Relations and Market Intelligence
1-510-381-7584 | srathod@rbglobal.com
Grafico Azioni RB Global (NYSE:RBA)
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Grafico Azioni RB Global (NYSE:RBA)
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