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ASBURY AUTOMOTIVE GROUP INC

ASBURY AUTOMOTIVE GROUP INCABGEarnings & Financial Report

NYSE · Consumer Discretionary · Retail-Auto Dealers & Gasoline Stations

Asbury Automotive Group is an American company based in the Atlanta area that operates auto dealerships in various parts of the United States. Founded in 1995, it was ranked No. 242 on the 2025 Fortune 500 list.

What changed in ASBURY AUTOMOTIVE GROUP INC's 10-K — 2024 vs 2025

Top changes in ASBURY AUTOMOTIVE GROUP INC's 2025 10-K

334 paragraphs added · 413 removed · 279 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

58 edited+6 added−16 removed70 unchanged
Our store operations are conducted by our subsidiaries and the Company operates in two reportable segments, the Dealerships and TCA segments.
Our store operations are conducted by our subsidiaries and the Company operates in two reportable segments, Dealerships and TCA.
We capitalize costs, such as employee sales commissions, to obtain customer contracts, and amortize those costs over the life of the contract. Amortization of costs to obtain customer contracts is included in selling, general and administrative expenses in the consolidated statements of income. The portion of commissions that are paid to affiliated dealerships are eliminated upon consolidation.
We capitalize costs, such as employee sales commissions, to obtain customer contracts, and amortize those costs over the life of the contract. Amortization of costs to obtain customer contracts is included in selling, general and administrative expenses in the consolidated statements of income. The portion of commissions that are paid to affiliated dealerships is eliminated upon consolidation.
Miller Dealerships Arizona Chrysler(b), Dodge Ram(c), Fiat, Ford, Genesis, Hyundai, Jeep(b), Nissan, Toyota, Volkswagen(a) California Toyota(a) Colorado Chrysler(a), Dodge Ram(b), Fiat, Ford, Jeep(a), Nissan, Volkswagen Idaho Chrysler, Dodge Ram, Honda, Jeep, Subaru New Mexico Chevrolet, Chrysler(a), Dodge Ram, Hyundai(a), Jeep(a), Toyota Utah Chevrolet(a), Chrysler(c), Dodge Ram(c), Ford(b), Honda, Jeep(c), Lexus(a), Lincoln, Mercedes-Benz, Toyota, Sprinter Mike Shaw, Stevinson & Arapahoe Automotive Groups Colorado Subaru(a), Chevrolet, Chrysler, Dodge Ram, Hyundai(a), Jaguar, Jeep, Lexus(a), Porsche, Toyota(a) Nalley Automotive Group Georgia Acura, Audi, Bentley, BMW, Honda, Hyundai, Infiniti(a), Kia, Lexus(a), Toyota(b), Volkswagen Park Place Automotive Texas Acura, Lexus(a), Land Rover, Mercedes-Benz(b), Porsche, Volvo, Sprinter(b) Plaza Motor Company Missouri Audi, BMW, Infiniti, Land Rover, Mercedes-Benz(a), Sprinter(a) ____________________________ (a) This dealership group has two of these franchises.
Miller Dealerships Arizona Chrysler(b), Dodge Ram(c), Fiat, Ford, Genesis, Hyundai, Jeep(b), Nissan, Toyota, Volkswagen(a) Colorado Chrysler(a), Dodge Ram(b), Fiat, Ford, Jeep(a), Volkswagen Idaho Chrysler, Dodge Ram, Honda, Jeep, Subaru New Mexico Chevrolet, Chrysler(a), Dodge Ram, Hyundai(a), Jeep(a), Toyota Utah Chevrolet, Chrysler, Dodge Ram, Ford(a), Honda, Jeep, Lincoln, Mercedes-Benz, Toyota, Sprinter Mike Shaw, Stevinson & Arapahoe Automotive Groups Colorado Subaru(a), Chevrolet, Hyundai(a), Jaguar, Lexus(a), Porsche, Toyota(a) Nalley Automotive Group Georgia Acura, Audi, Bentley, BMW, Honda, Hyundai, Infiniti(a), Kia, Lexus(a), Toyota(b), Volkswagen Park Place Automotive Texas Acura, Lexus(a), Land Rover, Mercedes-Benz(b), Porsche, Volvo, Sprinter(b) Plaza Motor Company Missouri Audi, BMW, Infiniti, Land Rover, Mercedes-Benz(a), Sprinter(a) ____________________________ (a) This dealership group has two of these franchises.
Accelerate same store growth and guest experience through technology investment . As part of our long-term growth strategy, we invest in technologies or partner with leading software platform vendors to develop applications that (i) serve our guests with omni-channel buying options offering enhanced speed, and transparency and (ii) drive a more efficient guest experience at a lower cost to serve.
Accelerate same store growth and guest experience through technology investment . As part of our long-term growth strategy, we invest in technologies and partner with leading software platform vendors to develop applications that (i) serve our guests with omni-channel buying options offering enhanced speed and transparency, and (ii) drive a more efficient guest experience at a lower cost to serve.
TCA’s key offerings include vehicle service contracts, prepaid maintenance, protection plans, key and remote replacement, leased vehicle protection and tire and wheel protection. Over the long-term, we expect that the profitability of our TCA products will be higher than the profitability associated with selling F&I products offered by third-parties.
TCA’s key offerings include vehicle service contracts, prepaid maintenance, protection plans, key and remote replacement, leased vehicle protection and tire and wheel protection. Over the long term, we expect the profitability of our TCA products will be higher than the profitability associated with selling F&I products offered by third parties.
We believe, however, that the increased use of advanced technology in vehicles is making it difficult for independent repair shops to compete effectively with franchised dealerships as they may not be able to make the investments necessary to perform major or technical repairs.
We believe that the increased use of advanced technology in vehicles is making it difficult for independent repair shops to compete effectively with franchised dealerships, however, as independent repair shops may not be able to make the investments necessary to perform major or technical repairs.
We are focused on providing a high level of customer service and have designed our dealerships’ services to meet the increasingly sophisticated needs of customers throughout the vehicle ownership lifecycle. Our digital capabilities further enhance our physical dealership network and drive additional revenue.
We are focused on providing a high level of customer service and have designed our dealership services to meet the increasingly sophisticated needs of customers throughout the vehicle ownership lifecycle. Our digital capabilities further enhance our physical dealership network and drive additional revenue.
Similarly, we are able to leverage our scale to implement these best practices when integrating newly acquired dealerships allowing us to continue to improve our operating efficiencies. 11 Table of Contents Deploy capital to highest returns and continue to invest in the business.
Similarly, 12 Table of Contents we are able to leverage our scale to implement these best practices when integrating newly acquired dealerships allowing us to continue to improve our operating efficiencies. Deploy capital to highest returns and continue to invest in the business.
However, none of our dealerships has been subject to any material liabilities in the past, nor do we know of any fact or condition that would result in any material liabilities being incurred in the future. Human Capital Mission and Vision At Asbury, our North Star and our mission is to be the most guest-centric automotive retailer.
However, none of our dealerships has been subject to any material liabilities in the past, nor do we know of any fact or condition that would result in any material liabilities being incurred in the future. 16 Table of Contents Human Capital Mission and Vision At Asbury, our North Star and our mission is to be the most guest-centric automotive retailer.
As of December 31, 2024, we employed approximately 15,000 full-time and part-time employees, none of whom were covered by collective bargaining agreements. We believe we have good relations with our employees.
As of December 31, 2025, we employed approximately 15,000 full-time and part-time employees, none of whom were covered by collective bargaining agreements. We believe we have good relations with our employees.
Item 1. BUSINESS Asbury Automotive Group, Inc., a Delaware corporation organized in 2002, is a Fortune 500 company and one of the largest franchised automotive retailers in the United States. Our mission and vision is to put the guest experience first and follow our "North Star" to be the most guest-centric automotive retailer in the industry.
Item 1. BUSINESS Asbury Automotive Group, Inc., a Delaware corporation organized in 2002, is a Fortune 500 company and one of the largest franchised automotive retailers in the United States. Our mission is to put the guest experience first and follow our "North Star," i.e., to be the most guest-centric automotive retailer in the industry.
We compete with a broad range of financial institutions in arranging financing for our customers' vehicle purchases. In addition, many financial institutions are now offering F&I products through the internet, which has increased competition and may reduce our profits on certain of these items.
We compete with a broad range of financial institutions in arranging financing for our customers' vehicle purchases. In addition, many financial institutions are now offering F&I products through the internet, which has increased competition and 13 Table of Contents may reduce our profits on certain of these items.
Through donations from our guests and company match, we have contributed more than $1.5 million to HBCUs since the start of our partnership with HBCU Change in May 2021. Recruitment and Talent Development When recruiting for open positions, we search for the most talented people who each have varying backgrounds, perspectives, and experiences.
Through donations from our guests and company match, we have contributed more than $1.95 million to HBCUs across the country since the start of our partnership with HBCU Change in May 2021. Recruitment and Talent Development When recruiting for open positions, we search for the most talented people who each have varying backgrounds, perspectives, and experiences.
Our operations are also subject to the National 14 Table of Contents Traffic and Motor Vehicle Safety Act, Federal Motor Vehicle Safety Standards and other product standards promulgated by the United States Department of Transportation, and the rules and regulations of various state motor vehicle regulatory agencies.
Our operations are also subject to the National Traffic and Motor Vehicle Safety Act, Federal Motor Vehicle Safety Standards and other product standards promulgated by the United States Department of Transportation, and the rules and regulations of various state motor vehicle regulatory agencies.
Our success depends on our employees and their commitment to delivering a consistent and exceptional guest experience. Our employees work at locations in Colorado, Florida, Georgia, Indiana, Missouri, South Carolina, Texas, California, Arizona, New Mexico, Idaho, Utah, Virginia and Maryland.
Our success depends on our employees and their commitment to delivering a consistent and exceptional guest experience. Our employees work at locations in Arizona, Colorado, Florida, Georgia, Idaho, Indiana, Maryland, Massachusetts, Missouri, New Mexico, Rhode Island, South Carolina, Texas, Utah, and Virginia.
In addition, we provide collision repair services at our 37 free-standing collision repair centers that we operate either on the premises of, or in close proximity to, our dealerships. Historically, parts and service revenues have been more stable than those from vehicle sales.
Additionally, we provide collision repair services at our 39 free-standing collision repair centers that we operate either on the premises of or in close proximity to our dealerships. Historically, parts and service revenues have been more stable than revenues from vehicle sales.
We believe the principal competitive factors in providing financing are convenience, interest rates, and flexibility in contract length. 12 Table of Contents Seasonality The automobile industry has historically been subject to seasonal variations.
We believe the principal competitive factors in providing financing are convenience, interest rates, and flexibility in contract length. Seasonality The automobile industry has historically been subject to seasonal variations.
We believe that our employees help to set us apart from our competitors, and, therefore, we understand 15 Table of Contents they are our greatest asset. As a result, a critical part of our business strategy is investing in, supporting and developing our employees so that they are trained and incentivized to provide best-in-class service to our guests.
We believe that our employees help to set us apart from our competitors, and, therefore, we understand they are one of our greatest assets. As a result, a critical part of our business strategy is investing in, supporting and developing our employees so that they are trained and incentivized to provide best-in-class service to our guests.
We also partner with local colleges and trade schools to develop apprenticeship and internship programs. This allows us to help provide valuable training to entry-level candidates while also growing our pipeline. Our goal is to promote employees from within to career growth opportunities whenever possible. We invest resources to train and develop our employees to reach their career goals.
We also partner with local colleges and trade schools to develop apprenticeship and internship programs. This allows us to help provide valuable training to entry-level candidates while also growing our pipeline. Our goal is to promote employees from within to career growth opportunities whenever possible.
We also evaluate dealership acquisition opportunities based on market position and geography, brand representation and availability, key personnel and other factors. Our approach to dispositions and acquisitions is highly disciplined with a focus on long-term strategic value to stockholders. Deliver on our mission to grow and transform our business with revenue of $30 billion or more by 2030.
We also evaluate dealership acquisition opportunities based on market position and geography, brand representation and availability, key personnel and other factors. Our approach to dispositions and acquisitions is highly disciplined, with a focus on long-term strategic value to stockholders. Deliver on our mission to grow and transform our business.
Compensation and Benefits We offer competitive compensation and benefits to attract and retain the best people, including the following benefits for our full-time employees: • Health, dental, and vision benefits with multiple plan choices; • Discounted healthcare premiums for biometric screening and completion of health survey; and • Employee assistance program. 16 Table of Contents Saving and retirement • Holiday match; and • 401(k) match.
Compensation and Benefits We offer competitive compensation and benefits to attract and retain the best people, including the following benefits for our full-time employees: • Health, dental, and vision benefits with multiple plan choices; • Discounted healthcare premiums for biometric screening and completion of health survey; and 17 Table of Contents • Employee assistance program.
F&I revenue in our TCA segment represents the premium revenue earned from customers for F&I products primarily sold in connection with the purchase of vehicles at our dealerships. The premium revenue is recognized over the life of the F&I 10 Table of Contents product contract as services are provided.
This F&I revenue is presented net of third-party chargebacks. 11 Table of Contents F&I revenue in our TCA segment represents the premium revenue earned from customers for F&I products primarily sold in connection with the purchase of vehicles at our dealerships. The premium revenue is recognized over the life of the F&I product contract as services are provided.
F&I revenue in our Dealerships segment represents the commissions earned from both TCA and independent third parties related to a broad range of F&I products. This F&I revenue is presented net of third-party chargebacks.
F&I revenue in our Dealerships segment represents the commissions earned from both TCA and independent third parties related to a broad range of F&I products.
The following chart provides a detailed breakdown of our states, brand names, and franchises as of December 31, 2024: Dealership Group Brand Name State Franchise Coggin Automotive Group Florida Acura, BMW, Buick, Chevrolet, Ford(a), GMC, Honda(d), Hyundai, Mercedes-Benz, Nissan(a), Toyota Courtesy Autogroup Florida Chrysler, Dodge Ram, Honda, Hyundai, Infiniti, Jeep, Kia, Mercedes-Benz, Nissan, Sprinter, Toyota Crown Automotive Company South Carolina Nissan Virginia Acura, BMW(a), MINI David McDavid Auto Group Texas Ford, Honda(a), Lincoln Greenville Automotive Group South Carolina Land Rover, Porsche, Toyota, Volvo Hare, Bill Estes & Kahlo Automotive Groups Indiana Chevrolet(b), Chrysler(a), Dodge Ram(a), Ford, GMC, Honda, Isuzu, Jeep(a), Toyota Jim Koons Automotive Companies Maryland Chevrolet(a), Ford, GMC, Kia, Mercedes-Benz, Sprinter, Toyota(b), Volvo Virginia Buick, Chevrolet, Chrysler, Dodge Ram, Ford(b), GMC(a), Hyundai, Jeep, Kia, Toyota(a) Larry H.
The following chart provides a detailed breakdown of our states, brand names, and franchises as of December 31, 2025: Dealership Group Brand Name State Franchise Coggin Automotive Group Florida Acura, BMW, Buick, Chevrolet, Ford(a), GMC, Honda(d), Hyundai, Mercedes-Benz, Nissan(a), Toyota Courtesy Autogroup Florida Chrysler, Dodge Ram, Honda, Hyundai, Infiniti, Jeep, Kia, Mercedes-Benz, Nissan, Sprinter, Toyota Crown Automotive Company South Carolina Nissan Virginia Acura, BMW(a), MINI David McDavid Auto Group Texas Ford, Honda(a), Lincoln Greenville Automotive Group South Carolina Land Rover, Porsche, Toyota Hare, Bill Estes & Kahlo Automotive Groups Indiana Chevrolet, Chrysler(a), Dodge Ram(a), Ford, Honda, Isuzu, Jeep(a), Toyota Herb Chambers Dealerships Massachusetts Alfa Romeo(a), Audi(a), Bentley, BMW(a), Cadillac, Chevrolet, Chrysler(a), Dodge Ram(a), Fiat(a), Ford(a), Honda(b), Hyundai, Infiniti, Jaguar(a), Jeep(a), Kia, Lamborghini, Land Rover(a), Lexus(a), Lincoln(a), Maserati(a), Mercedes-Benz(a), MINI, Porsche(a), Rolls Royce, Sprinter, Toyota(a), Volvo Rhode Island Alfa Romeo, Cadillac, Maserati Jim Koons Automotive Companies Maryland Chevrolet(a), Ford, GMC, Kia, Mercedes-Benz, Sprinter, Toyota(a), Volvo Virginia Buick, Chevrolet, Chrysler, Dodge Ram, Ford(b), GMC(a), Hyundai, Jeep, Kia, Toyota(a) Larry H.
However, typical dealer agreements give the manufacturer the right to terminate or the option of non-renewal of the dealer agreement under certain circumstances, subject to applicable state automotive dealership franchise laws, including: • insolvency or bankruptcy of the dealership; • failure to adequately operate the dealership or to maintain required capitalization levels; • impairment of the reputation or financial condition of the dealership; • change of ownership or management of the dealership without manufacturer consent; • certain extraordinary corporate transactions such as a merger or sale of all or substantially all of our assets without manufacturer consent; • failure to complete facility upgrades required by the manufacturer or agreed to by the dealer; • failure to maintain any license, permits or authorization required to conduct the dealership's business; • conviction of a dealer/manager or owner for certain crimes; or • material breach of other provisions of a dealer agreement.
However, typical dealer agreements give the manufacturer the right to terminate or the option of non-renewal of the dealer agreement under certain circumstances, subject to applicable state automotive dealership franchise laws, including: • insolvency or bankruptcy of the dealership; • failure to adequately operate the dealership or to maintain required capitalization levels; • impairment of the reputation or financial condition of the dealership; • change of ownership or management of the dealership without manufacturer consent; • certain extraordinary corporate transactions such as a merger or sale of all or substantially all of our assets without manufacturer consent; • failure to complete facility upgrades required by the manufacturer or agreed to by the dealer; • failure to maintain any license, permits or authorization required to conduct the dealership's business; • conviction of a dealer/manager or owner for certain crimes; or • material breach of other provisions of a dealer agreement. 14 Table of Contents Notwithstanding the terms of any dealer agreement, the states in which we operate have automotive dealership franchise laws which provide that it is unlawful for a manufacturer to terminate or not renew a franchise unless "good cause" exists.
We believe that leasing provides a number of benefits to our other business lines, including the historical customer loyalty to the leasing dealership for repairs and maintenance services and the fact that lessors typically give the leasing dealership the first option to purchase the off-lease vehicle. 9 Table of Contents Used Vehicle Sales We sell used vehicles at all our franchised dealership locations.
We believe that leasing provides a number of benefits to our other business lines, including the historical 10 Table of Contents customer loyalty to the leasing dealership for repairs and maintenance services and the fact that lessors typically give the leasing dealership the first option to purchase the off-lease vehicle.
The Company’s transaction adjusted net leverage ratio was 2.85x at December 31, 2024, compared to 2.54x at December 31, 2023. We believe our cash position and borrowing capacity, combined with our current and expected future cash generation capability, provides us with financial flexibility to, among other things, reinvest in our business, acquire dealerships and repurchase our stock, when prudent.
The Company’s transaction-adjusted net leverage ratio was 3.2x as of December 31, 2025, compared to 2.9x as of December 31, 2024. We believe our cash position and borrowing capacity, combined with our current and expected future cash generation capability, provide us with financial flexibility to, among other things, reinvest in our business, acquire dealerships and repurchase our stock, when prudent.
These laws and regulations include state franchise laws and regulations, product standards and recalls, consumer protection laws, privacy and data security laws, anti-money laundering laws, and other extensive laws and regulations applicable to new and used motor vehicle dealers. These laws also include federal and state wage and hour, anti-discrimination, and other laws governing employment practices.
These laws and regulations include state franchise laws and regulations, product standards and recalls, consumer protection laws, privacy and data security laws, anti-money laundering laws, and other extensive laws and regulations applicable to new and used motor vehicle dealers.
Aligning with our strategic outlook, the Company, on February 14, 2025, through one of its subsidiaries, entered into a Transaction Agreement with the Herb Chambers Dealerships that will result in the Company acquiring substantially all of the assets, including all real property and businesses of the Herb Chambers Dealerships, which comprise 33 dealerships, 52 franchises and three collision centers, which is expected to positively contribute to the Company’s overall revenue objectives.
Aligning with our strategic outlook, the Company entered into a Transaction Agreement related to the Herb Chambers dealership group that closed on July 21, 2025, resulting in the Company acquiring substantially all of the assets, including all real property and businesses of the Herb Chambers dealership group, which comprise 33 dealerships, 52 franchises and three collision centers, and which is expected to contribute positively to the Company’s overall revenue objectives.
(d) This dealership group has five of these franchises. 8 Table of Contents Operations New Vehicle Sales The following table reflects the number of franchises we owned as of December 31, 2024 and the percentage of new vehicle revenues represented by class and franchise for the year ended December 31, 2024: Class/Franchise Number of Franchises Owned % of New Vehicle Revenues Luxury Mercedes-Benz 9 8 % Lexus 8 10 BMW 5 3 Acura 4 1 Infiniti 4 1 Land Rover 3 2 Porsche 3 2 Volvo 3 1 Audi 2 1 Lincoln 2 1 Genesis 1 * Bentley 1 * Jaguar 1 * Total Luxury 46 30 % Import Toyota 19 19 % Honda 12 9 Hyundai 9 5 Sprinter 8 1 Nissan 6 2 Kia 4 2 Volkswagen 4 1 Subaru 3 2 Fiat 2 * MINI 1 * Isuzu 1 * Total Import 69 41 % Domestic Chrysler, Dodge, Jeep, Ram 52 9 % Chevrolet, Buick, GMC 18 8 Ford 13 13 Total Domestic 83 29 % Total Franchises 198 100 % * Franchise accounted for less than 1% of new vehicle revenues for the year ended December 31, 2024.
(d) This dealership group has five of these franchises. 9 Table of Contents Operations New Vehicle Sales The following table reflects the number of franchises we owned as of December 31, 2025 and the percentage of new vehicle revenues represented by class and franchise for the year ended December 31, 2025: Class/Franchise Number of Franchises Owned % of New Vehicle Revenues Luxury Mercedes-Benz 11 7 % Lexus 8 11 BMW 7 4 Acura 4 1 Infiniti 5 1 Land Rover 5 2 Maserati 3 * Lamborghini 1 * Porsche 5 2 Alfa Romeo 3 * Volvo 3 1 Audi 4 1 Rolls Royce 1 * Lincoln 4 1 Genesis 1 * Bentley 2 * Jaguar 3 * Total Luxury 70 32 % Import Toyota 18 19 % Honda 15 9 Hyundai 10 5 Sprinter 9 1 Nissan 5 1 Kia 5 2 Volkswagen 4 1 Subaru 3 1 Fiat 4 * MINI 2 * Isuzu 1 * Total Import 76 40 % Domestic Cadillac 2 * Chrysler, Dodge, Jeep, Ram 46 8 % Chevrolet, Buick, GMC 15 7 Ford 14 13 Total Domestic 77 28 % Total Franchises 223 100 % * Franchise accounted for less than 1% of new vehicle revenues for the year ended December 31, 2025.
Additionally, our used vehicle sales benefit from our ability to sell certified pre-owned vehicles from our franchised dealerships. Parts and Service We provide vehicle repair and maintenance services, sell replacement parts, and recondition used vehicles at all of our dealerships.
We also purchase a portion of our used vehicle inventory at "open" auctions and auctions restricted to new vehicle dealers. Additionally, our used vehicle sales benefit from our ability to sell certified pre-owned vehicles from our franchised dealerships. Parts and Service We provide vehicle repair and maintenance services, sell replacement parts, and recondition used vehicles at all our dealerships.
Four Key Components of Our Business The following chart presents the contribution to total revenue and gross profit by each line of business for the year ended December 31, 2024: 7 Table of Contents Our new vehicle franchise retail network within our Dealerships segment is made up of dealerships located in 14 states operating primarily under 16 locally branded dealership groups.
The Company recorded a pre-tax gain totaling $13.5 million. 7 Table of Contents Four Key Components of Our Business The following chart presents the contribution to total revenue and gross profit by each line of business for the year ended December 31, 2025: 8 Table of Contents Our new vehicle franchise retail network within our Dealerships segment is made up of dealerships located in 15 states operating primarily under 17 locally branded dealership groups.
As of December 31, 2024, we owned and operated 198 new vehicle franchises, representing 31 brands of automobiles at 152 dealership locations, 37 collision centers, and Total Care Auto, Powered by Landcar ("TCA" or "TCA Business"), our finance and insurance ("F&I") product provider, within 14 states.
As of December 31, 2025, we owned and operated 223 new vehicle franchises, representing 36 brands of automobiles at 171 dealership locations, 39 collision centers, and Total Care Auto, Powered by Asbury ("TCA" or "TCA Business"), our finance and insurance ("F&I") product provider, within 15 states.
Used vehicle sales include the sale of used vehicles to individual retail customers ("used retail") and the sale of used vehicles to other dealers or licensed wholesalers ("wholesale") (the terms "used retail" and "wholesale" collectively referred to as "used").
Used Vehicle Sales We sell used vehicles at all our franchised dealership locations. Used vehicle sales include the sale of used vehicles to individual retail customers ("used retail") and the sale of used vehicles to other dealers or licensed wholesalers ("wholesale") (the terms "used retail" and "wholesale" are collectively referred to as "used").
Paid time off • Up to 4 weeks paid time off; • Paid pregnancy leave; and • Paid parental leave. Disability and accident insurance • Short-term disability and long-term disability insurance; • Accident insurance, hospital indemnity, employee critical illness insurance; • Employer paid life insurance; and • Supplemental life insurance. Scholarships for education • Annual scholarship program.
Saving and retirement • 401(k) match. Paid time off • Up to 4 weeks paid time off; • Paid pregnancy leave; and • Paid parental leave. Disability and accident insurance • Short-term disability and long-term disability insurance; • Accident insurance, hospital indemnity, employee critical illness insurance; • Employer paid life insurance; and • Supplemental life insurance.
In 2022, we launched a training curriculum for all store positions. In addition, we offer our employees access to an online career path tool, which helps them plan their desired career path and see the required performance goals and milestones to be considered for a promotion.
In addition, we offer our employees access to an online career path tool, which helps them plan their desired career path and see the required performance goals and milestones to be considered for a promotion. Our fixed operations organization requires technicians to obtain and maintain certification status with our vehicle manufacturers, and our dealerships pay for the required training.
The Company recorded a pre-tax gain totaling $8.6 million, which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net. During the year ended December 31, 2023, we sold 1 franchise (1 dealership location) in Austin, Texas. The Company recorded a pre-tax gain totaling $13.5 million.
During the year ended December 31, 2024, we sold the following franchises: Manufacturer Franchises Locations States Nissan 2 2 Colorado; Georgia Lexus 1 1 Delaware Chevrolet 1 1 Georgia Honda 1 1 Washington The Company recorded a pre-tax gain totaling $8.6 million which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net.
The general manager of each of our dealerships is responsible for the operations, personnel and financial performance of that dealership as well as other day-to-day operations. Leverage scale and cost structure to improve operating efficiencies. We are positioned to leverage our significant scale so that we are able to achieve competitive operating margins by centralizing and streamlining various back-office functions.
Leverage scale and cost structure to improve operating efficiencies. We are positioned to leverage our significant scale so that we are able to achieve competitive operating margins by centralizing and streamlining various back-office functions.
Gross profit from the sale of used vehicles depends primarily on our dealerships' ability to obtain a high quality supply of used vehicles and our use of technology to manage our inventory.
Gross profit from the sale of used vehicles depends primarily on our dealerships' ability to obtain a high-quality supply of used vehicles and our use of technology to manage our inventory. Our new vehicle operations typically provide our used vehicle operations with a large supply of trade-ins and off-lease vehicles, which we believe are good sources of high-quality used vehicles.
Industry Regulations The Federal Trade Commission ("FTC") has regulatory authority over automotive dealers and has implemented enforcement initiatives relating to the marketing practices of automotive dealers.
These laws also include federal and state wage and hour, anti-discrimination, and other laws governing employment practices. 15 Table of Contents Industry Regulations The Federal Trade Commission ("FTC") has regulatory authority over automotive dealers and has implemented enforcement initiatives relating to the marketing practices of automotive dealers.
On December 11, 2023, the Company completed the acquisition of the business of the Jim Koons ("Koons") Automotive Companies, (collectively, the "Koons acquisition"), thereby acquiring 20 new vehicle dealerships, six collision centers and the real property related thereto for an aggregate purchase price of approximately $1.50 billion, which includes $256.1 million of new vehicle floor plan financing and $100.9 million of assets held for sale related to Koons Lexus of Wilmington.
There were no acquisitions during the year ended December 31, 2024. On December 11, 2023, the Company completed its acquisition of the Jim Koons ("Koons") Automotive Companies, (collectively, the "Koons acquisition"), acquiring 20 new vehicle dealerships, six collision centers and the real property related thereto for an aggregate purchase price of approximately $1.50 billion.
We are continuing to integrate TCA’s service offerings across our full dealership portfolio to increase our F&I product penetration and profitability.
We are continuing to integrate TCA’s service offerings across our full dealership portfolio to increase our F&I product penetration and profitability. We completed the rollout of TCA's service offerings in our Florida market and the Koons platform during the year ended December 31, 2025.
Broad employee equity ownership • We also lead the industry by offering equity awards to frontline employees because we want them to be owners of our Company and committed to our long-term success. Self-Insurance Programs Due to the inherent risk in the automotive retail industry, our operations expose us to a variety of liabilities.
Scholarships for education • Annual scholarship program. Broad employee equity ownership • We also lead the industry by offering equity awards to frontline employees because we want them to be owners of our Company and committed to our long-term success.
We intend to execute on this strategic plan by focusing on a variety of growth efforts including, balanced capital allocation, driving same-store revenue growth and acquiring revenue through strategic transactions.
We continually evaluate additional opportunities to drive revenue growth while maintaining our disciplined approach to capital allocation. We intend to execute on our strategic plan by focusing on a variety of growth efforts including, balanced capital allocation, driving same-store revenue growth, acquiring revenue through strategic transactions, opportunistically repurchasing our stock, and harvesting operating efficiencies enabled by the transition to Tekion.
Attract, retain and invest in top talent to drive growth and optimize operations . We believe the core of our business success lies in our talent pool, so we are focused on attracting, hiring and retaining the best people. We also invest in resources to train and develop our employees.
We believe the core of our business success lies in our talent pool, so we are focused on attracting, hiring and retaining the best people. We also invest in resources to train and develop our employees. Our executive management team has extensive experience in the auto retail sector and is able to leverage experience from all positions throughout the Company.
These risks generally require significant levels of insurance covering liabilities such as claims from employees, customers, or other third parties, for personal injury and property-related losses occurring in the course of our operations. We may be subject to fines and civil and criminal penalties in connection with alleged violations of federal and state laws or regulatory environments.
Self-Insurance Programs Due to the inherent risk in the automotive retail industry, our operations expose us to a variety of liabilities. These risks generally require significant levels of insurance covering liabilities such as claims from employees, customers, or other third parties, for personal injury and property-related losses occurring in the course of our operations.
The acquisition was funded with borrowings under Asbury’s existing credit facility and cash on hand. The Koons acquisition diversified Asbury's geographic mix, with expansion in the greater Washington-Baltimore region of the United States.
The acquisition was funded with borrowings under Asbury’s existing credit facility and cash on hand.
The insurance companies that underwrite our insurance require we secure certain of our obligations for deductible reimbursements with collateral. Our collateral requirements are set by the insurance companies and, to date, have been satisfied by posting surety bonds, letters of credit, and/or cash deposits.
Our collateral requirements are set by the insurance companies and, to date, have been satisfied by posting surety bonds, letters of credit, and/or cash deposits. Our collateral requirements may change from time-to-time based on, among other things, our claims experience.
We expect to complete the rollout of TCA's service offerings to all of our dealerships in 2025 by offering TCA products in our Florida market during the first quarter of 2025, and the Koons platform in the second quarter of 2025; however, no assurance can be given that the rollout will be completed with the timeframe contemplated.
We expect to complete the rollout to all our dealerships in 2026 by offering TCA products on our Herb Chambers platform; however, no assurance can be given that the rollout will be completed within the timeframe contemplated. Attract, retain and invest in top talent to drive growth and optimize operations .
Our executive management team has extensive experience in the auto retail sector and is able to leverage experience from all positions throughout the Company. In addition, we believe that local management of dealership operations enables our retail network to provide market specific responses to sales, customer service and inventory requirements.
In addition, we believe that local management of dealership operations enables our retail network to provide market specific responses to sales, customer service and inventory requirements. The general manager of each of our dealerships is responsible for the operations, personnel and financial performance of that dealership as well as other day-to-day operations.
Our fixed operations organization encourages technicians to obtain and maintain certification status with our vehicle manufacturers, and in most cases, our dealership pays for the training. Our employees also attend vehicle manufacturer-sponsored and industry training events. We pride ourselves on rewarding and developing talented and tenured employees.
Our employees also attend vehicle manufacturer-sponsored and industry training events. We pride ourselves on rewarding and developing talented and tenured employees.
In addition, the Company maintains separate insurance policies to address potential cyber and directors and officers exposures. We are self-insured for certain employee medical claims and maintain stop-loss insurance for individual claims. Provisions for retained losses and deductibles are made by charges to expense based upon periodic evaluations of the estimated ultimate liabilities on reported and unreported claims.
Under our self-insurance programs, including property and casualty, workers’ compensation, and medical, the Company retains various levels of aggregate loss limits and per-claim deductibles. In addition, the Company maintains separate insurance policies to address potential cyber and directors and officers exposures. We are self-insured for certain employee medical claims and maintain stop-loss insurance for individual claims.
Since 2021, we have awarded all of our full-time employees with an additional 40 hours of paid time off per year that can be used to volunteer with our local community partners. We have seen significant year-over-year growth in employee participation in our community engagement events.
Since 2021, we have awarded our full-time employees with an additional 40 hours of paid time off per year that can be used to volunteer with our local community partners. We partner with charitable organizations that focus on building strong communities, enhancing education and youth development, improving health and wellness, and supporting veterans and military families.
Notwithstanding the terms of any dealer agreement, the states in which we operate have automotive dealership franchise laws which provide that it is unlawful for a manufacturer to terminate or not renew a franchise unless "good cause" exists. 13 Table of Contents In addition to requirements under dealer agreements, we are subject to provisions contained in supplemental agreements, framework agreements, dealer addenda and manufacturers' policies, collectively referred to as "framework agreements." Framework agreements impose requirements on us in addition to those described above.
In addition to requirements under dealer agreements, we are subject to provisions contained in supplemental agreements, framework agreements, dealer addenda and manufacturers' policies, collectively referred to as "framework agreements." Framework agreements impose requirements on us in addition to those described above.
A significant portion of our Asbury Cares Community program revolves around education and making sure that young people in underserved communities have access to a quality education. We formed a partnership with HBCU Change, an app-based organization that lets users round up their spending and donate to historically black colleges and universities ("HBCU").
We formed a partnership with HBCU Change, an app-based organization that lets users round up their spending and donate to Historically Black Colleges and Universities ("HBCU"). Within our locations, the point-of-sale credit card machines show a prompt asking our guests if they would like to donate to HBCU Change.
Pursuant to the Transaction Agreement, the Company is expected to acquire substantially all of the assets, including all real property and businesses, of the Herb Chambers Dealerships (collectively, the "Businesses") for an aggregate purchase price of approximately $1.34 billion, which includes $750 million for goodwill and approximately $590 million for the real estate and leasehold improvements.
Acquisitions On July 21, 2025, the Company completed its acquisition of substantially all of the assets, including real property and businesses, of The Herb Chambers Companies (the "Herb Chambers acquisition") for an aggregate purchase price of approximately $1.76 billion.
Our ability to provide a low friction experience across our omni-channel platform drives customer satisfaction and repeat business across our dealership portfolio. Acquisitions On February 14, 2025, the Company, through one of its subsidiaries, entered into a Purchase and Sale Agreement (the "Transaction Agreement") with various entities that comprise the Herb Chambers automotive group (the "Herb Chambers Dealerships").
Our ability to provide a low friction experience across our omni-channel platform drives customer satisfaction and repeat business across our dealership portfolio.
Further, the automobile retail industry is subject to substantial risk of real and personal property loss, due to the significant concentration of property values located at the various dealership locations. Under our self-insurance programs, including property and casualty, workers’ compensation, and medical, the Company retains various levels of aggregate loss limits and per-claim deductibles.
We may be subject to fines and civil and criminal penalties in connection with alleged violations of federal and state laws or regulatory environments. Further, the automobile retail industry is subject to substantial risk of real and personal property loss, due to the significant concentration of property values located at the various dealership locations.
Removed
In addition, the Company will acquire new vehicles, used vehicles, service loaner vehicles, fixed assets, parts and supplies for a purchase price to be determined at the closing (the "Closing") of the transactions set forth in the Transaction Agreement and will reimburse the Herb Chambers Dealerships for certain dealership construction and development costs incurred prior to the Closing.
Added
The Herb Chambers acquisition was primarily funded with borrowings under Asbury’s existing senior credit facility and borrowings under the 2025 Real Estate Facility. The Herb Chambers acquisition comprised 33 dealerships, 52 franchises and three collision centers and real property and related businesses. The Herb Chambers acquisition increased the Company's footprint in the northeast region of the United States.
Removed
The Businesses include 33 dealerships, 52 franchises and three collision centers. Herb Chambers will retain ownership of the Mercedes-Benz of Boston dealership in Somerville, Massachusetts (the "MB Boston Dealership").
Added
The Koons acquisition diversified Asbury's geographic mix, with expansion into the greater Washington-Baltimore region of the United States. 6 Table of Contents Divestitures During the year ended December 31, 2025, we sold the following franchises: Manufacturer Franchises Locations States Toyota 3 3 California; Maryland Nissan 1 1 Colorado Chrysler Jeep Dodge Ram 12 4 Colorado; Utah Volvo 1 1 South Carolina Lexus 2 2 Utah Chevrolet Buick GMC 4 3 Utah; Indiana Ford 1 1 Utah The Company recorded a pre-tax gain totaling $80.2 million which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net.
Removed
The Transaction Agreement includes certain restrictions and obligations regarding the sale of the MB Boston Dealership, including a put right obligating the Company to purchase the MB Boston Dealership during the five-year period following the Closing, absent certain circumstances.
Added
During the year ended December 31, 2023, we sold one franchise (one dealership location) in Austin, Texas.
Removed
The Closing is subject to various customary closing conditions, including (i) receipt of approval of the transactions by certain automotive manufacturers, (ii) receipt of certain governmental clearances, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (iii) the continued accuracy of the representations and warranties of the parties, (iv) the assignment of certain leases and key contracts and (v) the absence of a material adverse effect.
Added
In 2025, we supported more than 75 organizations within our local communities. As part of our Asbury Cares Community program, a significant portion of our efforts revolve around education and making sure that young people in underserved communities have access to a quality education.
Removed
The Transaction Agreement also contains certain termination rights. The Herb Chambers Dealerships may, in some circumstances of termination, be required to pay us a termination fee of $100 million, and in other circumstances of termination, be entitled to receive certain earnest money.
Added
We invest significant resources to train and develop our employees to provide a great guest experience, enable success in their roles, and reach their career goals. In 2022, we launched a training curriculum for all store positions. In 2024, we also implemented guest experience training for all employees.
Removed
The Closing is anticipated to occur in the second quarter of 2025. 6 Table of Contents Some but not all of the factors that could cause actual results or events to differ materially from those anticipated are set forth at "Item 1A. Risk Factors" in this Form 10-K.
Added
Provisions for retained losses and deductibles are made by charges to expense based upon periodic evaluations of the estimated ultimate liabilities on reported and unreported claims. The insurance companies that underwrite our insurance require we secure certain of our obligations for deductible reimbursements with collateral.
Removed
There were no acquisitions during the years ended December 31, 2024 and 2022.
Removed
Divestitures During the year ended December 31, 2024, we sold 1 Lexus franchise (1 dealership location) in Wilmington, Delaware due to OEM requirements in connection with the Koons acquisition, 1 Nissan franchise (1 dealership location) in Denver, Colorado, 1 Nissan franchise (1 dealership location) in Atlanta, Georgia, 1 Chevrolet franchise (1 dealership location) in Atlanta, Georgia and 1 Honda franchise (1 dealership location) in Spokane, Washington.
Removed
During the year ended December 31, 2022, we sold one franchise (one dealership location) in St. Louis, Missouri, three franchises (three dealership locations) and one collision center in Denver, Colorado, two franchises (two dealership locations) in Spokane, Washington, one franchise (one dealership location) in Albuquerque, New Mexico and 11 franchises (nine dealership locations) and two collision centers in North Carolina.
Removed
The Company recorded a pre-tax gain totaling $207.1 million.
Removed
Our new vehicle operations typically provide our used vehicle operations with a large supply of trade-ins and off-lease vehicles, which we believe are good sources of high quality used vehicles. We also purchase a portion of our used vehicle inventory at "open" auctions and auctions restricted to new vehicle dealers.
Removed
We continually evaluate additional opportunities to drive revenue growth while maintaining our disciplined approach to capital allocation. In February 2024, the Company announced an update to our strategic outlook targeting revenue of $30 billion or more by 2030.
Removed
We learned that many HBCUs historically lag in funding and resources compared to other public or private universities and many have closed their doors in recent years.
Removed
Many of our Asbury team members are proud HBCU alumni and these institutions provide a unique community of support and understanding for not only African American students, but students of all races and backgrounds. In partnership with HBCU Change, we launched a campaign to help raise funds for HBCUs across the country and in the local communities where we operate.
Removed
The point-of-sale credit card machines in our locations show a prompt asking our guests if they would like to round up their change or donate $1, $3, $5, or a custom amount to HBCUs in their communities. At the end of each quarter, the funds raised are donated to HBCUs across the country.
Removed
Our collateral requirements may change from time-to-time based on, among other things, our claims experience. 17 Table of Contents

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Cyber incidents can include, for example, phishing, credential harvesting or use of stolen access credentials, unauthorized access to systems, networks or devices (for example, through hacking activity), structured query language attacks, infection from or spread of malware, ransomware, computer viruses or other malicious software code, corruption of data, exfiltration of data to malicious sites, the dark web or other locations or threat actors, the use of fraudulent or fake websites, and other attacks (including, but not limited to, denial-of-service attacks on websites), which shut down, disable, slow, impair or otherwise disrupt operations, business processes, technology, connectivity or website or internet access, functionality or performance.
Cybersecurity incidents can include, for example, phishing, credential harvesting or use of stolen access credentials, unauthorized access to systems, networks or devices (for example, through hacking activity), structured query language attacks, infection from or spread of malware, ransomware, computer viruses or other malicious software code, corruption of data, exfiltration of data to malicious sites, the dark web or other locations or threat actors, the use of fraudulent or fake websites, and other attacks (including, but not limited to, denial-of-service attacks on websites), which shut down, disable, slow, impair or otherwise disrupt operations, business processes, technology, connectivity or website or internet access, functionality or performance.
We also cannot guarantee that the benefits and cost synergies that we currently expect to realize as a result of the Herb Chambers Dealerships acquisition will be achieved within our anticipated time frames or at all.
We also cannot guarantee that the benefits and cost synergies that we currently expect to realize as a result of the Herb Chambers acquisition will be achieved within our anticipated time frames or at all.
Among other things, the Company’s lawsuit asserts that the FTC’s administrative proceeding violates Asbury’s constitutional rights by denying it the right to a jury trial and by allowing the FTC to serve as both prosecutor and judge in the same proceeding.
Among other things, the Company’s lawsuit asserts that the FTC’s administrative proceeding violates the Company’s constitutional rights by denying it the right to a jury trial and by allowing the FTC to serve as both prosecutor and judge in the same proceeding.
Additionally, in the ordinary course of business, we and our partners receive significant PII about our customers in order to complete the sale or service of a vehicle and related products. We also receive PII from our employees.
Additionally, in the ordinary course of business, we and our partners receive PII about our customers in order to complete the sale or service of a vehicle and related products. We also receive PII from our employees.
In addition, if a vehicle manufacturer’s financial condition worsens and it seeks protection from creditors in bankruptcy or similar proceedings, or otherwise under the laws of its jurisdiction of organization, (i) the manufacturer could seek to terminate or reject all or certain of our franchises, (ii) if the manufacturer is successful in terminating all or certain of our franchises, we may not receive adequate compensation for those franchises, (iii) our cost to obtain financing for our new vehicle inventory 22 Table of Contents may increase or no longer be available from such manufacturer’s captive finance subsidiary, (iv) consumer demand for such manufacturer’s products could be materially adversely affected, especially if costs related to improving such manufacturer’s financial condition are factored into the price of its products, (v) there may be a significant disruption in the availability of consumer credit to purchase or lease that manufacturer’s vehicles or negative changes in the terms of such financing, which may negatively impact our sales, or (vi) there may be a reduction in the value of receivables and inventory associated with that manufacturer, among other things.
If a vehicle manufacturer’s financial condition worsens and it seeks protection from creditors in bankruptcy or similar proceedings, or otherwise under the laws of its jurisdiction of organization, (i) the manufacturer could seek to terminate or reject all or certain of our franchises, (ii) if the manufacturer is successful in terminating all or certain of our franchises, we may not receive adequate compensation for those franchises, (iii) our cost to obtain financing for our new vehicle inventory may increase or no longer be available from such manufacturer’s captive finance subsidiary, (iv) consumer demand for such manufacturer’s products could be materially adversely affected, especially if costs related to improving such manufacturer’s financial condition are factored into the price of its products, (v) there may be a significant disruption in the availability of consumer credit to purchase or lease that manufacturer’s vehicles or negative changes in the terms of such financing, which may negatively impact our sales, or (vi) there may be a reduction in the value of receivables and inventory associated with that manufacturer, among other things.
In addition, manufacturer dealer or framework agreements may require the prior approval of the applicable manufacturer before any change is made in dealership general managers or other management positions.
In addition, dealer and framework agreements may require the prior approval of the applicable manufacturer before any change is made in dealership general managers or other management positions.
Furthermore, we expect that new laws and regulations, particularly at the federal level, in other areas may be enacted, which could also materially adversely impact our business. On August 3, 2022, we received a Civil Investigative Demand ("CID") from the FTC requesting information and documents concerning the Company’s corporate structure and operation of six of its dealerships.
Furthermore, we expect that new laws and regulations, particularly at the federal level, in other areas may be enacted, which could also materially adversely impact our business. On August 3, 2022, we received a Civil Investigative Demand (“CID”) from the FTC requesting information and documents concerning the Company’s corporate structure and operation of six of its dealerships.
Our failure to comply with any of these covenants in the future could constitute a default under the relevant agreement, which could, depending on the relevant agreement, (i) entitle the creditors under such agreement to terminate our ability to borrow under the relevant agreement and accelerate our obligations to repay outstanding borrowings; (ii) require us to repay those borrowings; (iii) entitle the creditors under such agreement to foreclose on the property securing the relevant 25 Table of Contents indebtedness; or (iv) prevent us from making debt service payments on certain of our other indebtedness, any of which would have a material adverse effect on our business, financial condition, results of operations and cash flows.
Our failure to comply with any of these covenants in the future could constitute a default under the relevant agreement, which could, depending on the relevant agreement, (i) entitle the creditors under such agreement to terminate our ability to borrow under the relevant agreement and accelerate our obligations to repay outstanding borrowings; (ii) require us to repay those borrowings; (iii) entitle the creditors under such agreement to foreclose on the property securing the relevant indebtedness; or (iv) prevent us from making debt service payments on certain of our other indebtedness, any of which would have a material adverse effect on our business, financial condition, results of operations and cash flows.
On February 8, 2024, the FTC staff counsel sent to us a proposed consent order and draft complaint, alleging that the Company and three of our dealerships had violated Section 5 of the Federal Trade Commission Act ("FTC Act") and certain provisions of the Equal Credit Opportunity Act ("ECOA") in connection with the sale of add-on products (e.g., vehicle service contracts, maintenance plans, etc.), and advised that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.
On February 8, 2024, the FTC staff counsel sent to us a proposed consent order and draft complaint, alleging that the Company and three of our dealerships had violated Section 5 of the Federal Trade Commission Act (“FTC Act”) and certain provisions of the Equal Credit Opportunity Act in connection with the sale of add-on products (e.g., vehicle service contracts, maintenance plans, etc.), and advised that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.
Although the requirements contained in these agreements did not restrict our subsidiaries from distributing cash to us as of December 31, 2024, unexpected changes to our financial metrics or to the terms of our franchise agreements, dealer agreements, or other agreements with manufacturers could require us to alter the manner in which we distribute or use cash.
Although the requirements contained in these agreements did not restrict our subsidiaries from distributing cash to us as of December 31, 2025, unexpected changes to our financial metrics or to the terms of our franchise agreements, dealer agreements, or other agreements with manufacturers could require us to alter the manner in which we distribute or use cash.
Manufacturer recall campaigns could (i) adversely affect our new and used vehicle sales or customer residual trade-in valuations, (ii) cause us to temporarily remove vehicles from our inventory, (iii) force us to incur increased costs, and (iv) expose us to litigation and adverse publicity related to the sale of recalled vehicles, which could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Manufacturer recall campaigns could (i) adversely affect our new and used vehicle sales or customer residual trade-in valuations, (ii) cause us to temporarily remove vehicles from our inventory, (iii) force us to incur increased costs, and (iv) expose us to litigation and 22 Table of Contents adverse publicity related to the sale of recalled vehicles, which could have a material adverse effect on our business, results of operations, financial condition and cash flows.
In addition to our ability to incur additional debt in the future, there are operating and financial restrictions and covenants, such as leverage covenants, in certain of our debt and mortgage agreements, including the agreement governing our 2023 Senior Credit Facility and our mortgage agreements and related mortgage guarantees, as well as certain other agreements to which we are a party that may adversely affect our ability to finance our future operations or capital needs or to pursue certain business activities.
In addition to our ability to incur additional debt in the future, there are operating and financial restrictions and covenants, such as leverage covenants, in certain of our debt and mortgage agreements, including the agreement governing our 2023 Senior Credit Facility and our mortgage agreements and related mortgage guarantees, as well as certain other agreements to which we are a party that may adversely affect our ability to finance our future operations or capital needs or to pursue certain 25 Table of Contents business activities.
Failure of a manufacturer to develop passenger vehicles and light trucks that meet these and other government standards could subject the manufacturer to substantial penalties, increase the cost of vehicles sold to us, and adversely affect our ability to market and sell vehicles to meet consumer needs and desires, which could have a material adverse effect on our business, results of operations, financial condition or cash flows.
Failure of a manufacturer 30 Table of Contents to develop passenger vehicles and light trucks that meet these and other government standards could subject the manufacturer to substantial penalties, increase the cost of vehicles sold to us, and adversely affect our ability to market and sell vehicles to meet consumer needs and desires, which could have a material adverse effect on our business, results of operations, financial condition or cash flows.
In addition to intentional cyber incidents, unintentional cyber incidents can occur (for example, the inadvertent release of confidential or non-public personal information). Changes to our business, processes, systems, or technology, if not implemented properly, can increase our vulnerability to cyber incidents.
In addition to intentional cybersecurity incidents, unintentional cybersecurity incidents can occur (for example, the inadvertent release of confidential or non-public personal information). Changes to our business, processes, systems, or technology, if not implemented properly, can increase our vulnerability to cybersecurity incidents.
These laws have historically restricted the ability of automobile manufacturers to directly enter the retail market and sell vehicles directly to consumers. However, many states have recently passed or introduced legislation to permit direct to consumer sales of electric vehicles by certain companies, such as Tesla and Rivian, without the requirements of establishing a dealer network.
These laws have historically restricted the ability of automobile manufacturers to directly enter the retail market and sell vehicles directly to consumers. However, many states have recently passed or introduced legislation to permit direct to consumer sales of electric vehicles by certain companies, such as Tesla and Rivian, without the requirements of 23 Table of Contents establishing a dealer network.
"Controls and Procedures" below, we have concluded that a material weakness in our internal control over financial reporting existed as of December 31, 2024 and, accordingly, internal control over financial reporting and our disclosure controls and procedures were not effective as of such date.
"Controls and Procedures" below, we previously concluded that a material weakness in our internal control over financial reporting existed as of December 31, 2024 and, accordingly, internal control over financial reporting and our disclosure controls and procedures were not effective as of such date.
An incident may not be detected until well after it occurs and the severity and potential impact may not be fully known for a substantial period of time after it has been discovered.
A cybersecurity incident may not be detected until well after it occurs and the severity and potential impact may not be fully known for a substantial period of time after it has been discovered.
We 28 Table of Contents currently devote significant resources to comply with applicable federal, state, and local regulation of health, safety, environmental, zoning and land use regulations, and we may need to spend additional time, effort, and money to keep our operations and existing or acquired facilities in compliance therewith.
We currently devote significant resources to comply with applicable federal, state, and local regulation of health, safety, environmental, zoning and land use regulations, and we may need to spend additional time, effort, and money to keep our operations and existing or acquired facilities in compliance therewith.
Key incentive programs include: (i) customer rebates on new vehicles; (ii) dealer incentives on new vehicles; (iii) special financing or leasing terms; (iv) warranties on new and used vehicles; and (v) sponsorship of used vehicle sales by authorized new vehicle dealers. 24 Table of Contents Vehicle manufacturers often make many changes to their incentive programs.
Key incentive programs include: (i) customer rebates on new vehicles; (ii) dealer incentives on new vehicles; (iii) special financing or leasing terms; (iv) warranties on new and used vehicles; and (v) sponsorship of used vehicle sales by authorized new vehicle dealers. Vehicle manufacturers often make many changes to their incentive programs.
Triggers of these clauses are often based upon actions by our stockholders and are generally outside of our control. Restrictions on any unapproved changes of ownership or management may adversely impact our value, as they may prevent or deter prospective acquirers from gaining control of us.
Triggers of these clauses are often based upon actions by our stockholders and are generally outside of our control. Restrictions on any unapproved changes of 24 Table of Contents ownership or management may adversely impact our value, as they may prevent or deter prospective acquirers from gaining control of us.
The occurrence of any one or more of these events could have a material adverse effect on our business, results of operations, financial condition, and cash flows. Furthermore, the automotive manufacturing supply chain spans the globe.
The occurrence of any one or more of these events could have a material adverse effect on our business, results of operations, financial condition, and cash flows. In addition, the automotive manufacturing supply chain spans the globe.
The imposition of new, or adjustments to prevailing, quotas, duties, tariffs or other restrictions or limitations could have a material adverse effect on our business, financial condition, results of operations and cash flows.
The imposition of new, or adjustments to 31 Table of Contents prevailing, quotas, duties, tariffs or other restrictions or limitations could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Retail vehicle sales are cyclical and historically have experienced periodic downturns characterized by oversupply and weak demand, which could result in a need for us to lower the prices at which we sell vehicles, which would reduce our revenue per vehicle sold and our margins.
Retail vehicle sales are cyclical and historically have experienced periodic downturns characterized by oversupply and weak demand, which could result in a need for us to lower the prices at which we sell vehicles, which would reduce our 21 Table of Contents revenue per vehicle sold and our margins.
For the year ended December 31, 2024, manufacturers representing 5% or more of our revenues from new vehicle sales were as follows: Manufacturer (Vehicle Brands): % of Total New Vehicle Revenues Toyota Motor Sales, U.S.A., Inc. ( Toyota and Lexus ) 30 % Ford Motor Company ( Ford and Lincoln ) 13 % American Honda Motor Co., Inc.
For the year ended December 31, 2025, manufacturers representing 5% or more of our revenues from new vehicle sales were as follows: Manufacturer (Vehicle Brands): % of Total New Vehicle Revenues Toyota Motor Sales, U.S.A., Inc. (Toyota and Lexus) 30 % Ford Motor Company (Ford and Lincoln) 14 % American Honda Motor Co., Inc.
Our inability to execute a substantial portion of our business strategy, could adversely affect our business, results of operations, financial condition and cash flows. We seek to execute on our strategic plan using a variety of growth efforts, which includes driving same-store revenue growth and acquiring additional revenue through strategic acquisitions.
Our inability to execute a substantial portion of our business strategy could adversely affect our business, results of operations, financial condition and cash flow. We seek to execute on our strategic plan using a variety of growth efforts, which include driving same-store revenue growth and acquiring additional revenue through strategic acquisitions.
We have identified a material weakness in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements or otherwise adversely affect the accuracy, reliability or timeliness of our financial statements. As described under Item 9A.
We may identify a material weakness in our internal control over financial reporting in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements or otherwise adversely affect the accuracy, reliability or timeliness of our financial statements. As described under Item 9A.
As a result, rising interest rates may have the effect of simultaneously increasing our capital costs and reducing our revenues. Given our variable interest rate debt and floor plan notes payable outstanding as of December 31, 2024, each one percent increase in market interest rates would increase our total annual interest expense by approximately $16.7 million.
As a result, rising interest rates may have the effect of simultaneously increasing our capital costs and reducing our revenues. Given our variable interest rate debt and floor plan notes payable outstanding as of December 31, 2025, each one percent increase in market interest rates would increase our total annual interest expense by approximately $26.2 million.
For example, with the consummation of the Koons acquisition in 2023 and the pending Herb Chambers acquisition, we have experienced, and expect to continue to experience, significantly more sales, and have more assets and employees than we did previously.
For example, with the consummation of the Koons acquisition in 2023 and the Herb Chambers acquisition in 2025, we have experienced, and expect to continue to experience, significantly more sales, and have more assets and employees than we did prior to the transaction.
Cyber incidents can result from human error or intentional (or deliberate) attacks or unintentional events by insiders (e.g., employees) or third parties, including cybercriminals, competitors, nation-states and "hacktivists," among others.
Cybersecurity incidents can result from human error or intentional (or deliberate) attacks or unintentional events by insiders (e.g., employees) or third parties, including cybercriminals, competitors, nation-states and “hacktivists,” among others.
We depend on the efficient operation of our information systems and those of our third-party service providers. We rely on information systems at our dealerships in all aspects of our sales and service efforts, as well as in the preparation of our consolidated financial and operating data. All of our dealerships currently operate on three dealer management systems ("DMS").
We depend on the efficient operation of our information systems and those of our third-party service providers. We rely on information systems at our dealerships in all aspects of our sales and service efforts, as well as in the preparation of our consolidated financial and operating data.
As a result of management's evaluation, management identified the material weakness as a result of deficiencies in information 26 Table of Contents technology general controls ("ITGCs") at a third-party software vendor who supports the Dealer Management System ("DMS") utilized by the Koons dealership group that we acquired in December 2023.
Management identified the material weakness as a result of deficiencies in information technology general controls ("ITGCs") at a third-party software vendor who supports the DMS utilized by the Koons dealership group that we acquired in December 2023.
Additionally, we may incur substantial expenses in connection with the integration of the Herb Chambers Dealerships, which may exceed expectations and offset certain anticipated benefits.
Additionally, we may incur substantial expenses in connection with the integration of the Herb Chambers dealerships, which may exceed expectations and offset certain anticipated benefits, and in connection with certain ongoing obligations under the Herb Chambers Transaction Agreement.
If market conditions cause subprime lenders to tighten credit standards, or if interest rates increase, the ability to obtain financing from subprime lenders for these consumers to purchase vehicles could become limited, resulting in a decline in our vehicle sales, which in turn, could have a material adverse effect on our financial condition and results of operations.
If market conditions cause subprime lenders to tighten credit standards, or if interest rates increase, the ability to obtain financing from subprime lenders for these consumers to purchase vehicles could become limited, resulting in a decline in our vehicle sales, which in turn, could have a material adverse effect on our financial condition and results of operations. 26 Table of Contents A decline in our credit rating or a general disruption in the credit markets could negatively impact our liquidity and ability to conduct our operations.
For 21 Table of Contents example, improvements in electric, battery-powered and hybrid gas/electric vehicles have increased consumer demand for such vehicles.
For example, improvements in electric, battery-powered and hybrid gas/electric vehicles have increased consumer demand for such vehicles.
A decline in our credit rating or a general disruption in the credit markets could negatively impact our liquidity and ability to conduct our operations. A deterioration of our credit rating, or a general disruption in the credit markets, could limit our ability to obtain credit on terms acceptable to us, or at all.
A deterioration of our credit rating, or a general disruption in the credit markets, could limit our ability to obtain credit on terms acceptable to us, or at all.
Because of the increasing number and sophistication of some cybersecurity incidents and cyber-attacks, and despite the security measures we have in place and any additional measures we may implement or adopt in the future, our facilities and systems, and those of our third-party service providers and business partners, could be vulnerable to cybersecurity incidents, security breaches, computer viruses, lost or misplaced data, programming errors, scams, burglary, human errors, acts of vandalism and/or other events.
Because of the increasing number and sophistication of some cybersecurity incidents and cyber-attacks, including increased artificial intelligence driven "deep fake" and social engineering, and despite the security measures we have in place and any additional measures we may implement or adopt in the future, our facilities and systems, and those of our third-party service providers and business partners, which include but are not limited to vehicle manufacturers, could be vulnerable to cybersecurity incidents, security breaches, computer viruses, lost or misplaced data, programming errors, scams, burglary, human errors, acts of vandalism and/or other events.
( Chrysler, Dodge, Jeep, Ram and Fiat ) 9 % Mercedes-Benz USA, LLC ( Mercedes-Benz and Sprinter ) 8 % General Motors Company ( Chevrolet, Buick and GMC) 8 % Hyundai Motor North America ( Hyundai and Genesis ) 5 % Similar to automotive retailers, vehicle manufacturers may be affected by the long-term U.S. and international economic climate.
(Honda and Acura) 10 % Stellantis N.V. (Chrysler, Dodge, Jeep, Ram and Fiat) 8 % General Motors Company (Chevrolet, Buick and GMC) 7 % Mercedes-Benz USA, LLC (Mercedes-Benz, Smart and Sprinter) 7 % Hyundai Motor America (Hyundai) 6 % Similar to automotive retailers, vehicle manufacturers may be affected by the long-term U.S. and international economic climate.
Goodwill and manufacturer franchise rights comprise a significant portion of our total assets. We must test our goodwill and manufacturer franchise rights for impairment at least annually, which could result in a material, non-cash write-down of goodwill or manufacturer franchise rights and could have a material adverse effect on our results of operations and stockholders’ equity.
We must test our goodwill and manufacturer franchise rights for impairment at least annually, which could result in a material, non-cash write-down of goodwill or manufacturer franchise rights and could have a material adverse effect on our results of operations and stockholders’ equity. Our principal intangible assets are goodwill and our rights under our franchise agreements with vehicle manufacturers.
Our principal intangible assets are goodwill and our rights under our franchise agreements with vehicle manufacturers. Goodwill and indefinite-lived intangible assets, including manufacturer franchise rights, are subject to impairment assessments at least annually (or more frequently when events or changes in circumstances indicate that an impairment may have occurred), by applying a qualitative or quantitative assessment.
Goodwill and indefinite-lived intangible assets, including manufacturer franchise rights, are subject to impairment assessments at least annually (or more frequently when events or changes in circumstances indicate that an impairment may have occurred), by applying a qualitative or quantitative assessment. A decrease in our market capitalization or profitability increases the risk of goodwill impairment.
A failure of any of our information systems or those of our third-party service providers, the inability to successfully transition from one key information system platform to a different platform, or a data security breach with regard to personally identifiable information ("PII") about our customers or employees, could have a material adverse effect on our business, results of operations, financial condition and cash flows.
A failure of any of our information systems or those of our third-party service providers, or a security breach with regard to personally identifiable information ("PII") about our customers or employees, or other cybersecurity incident, could have a material adverse effect on our business, results of operations, financial condition and cash flows.
The benefits that are expected to result from the Herb Chambers Dealerships acquisition will depend, in part, on our ability to consummate the Herb Chambers Dealerships acquisition within the anticipated time period, or at all, and to integrate and realize the anticipated cost synergies from the Herb Chambers Dealerships acquisition.
The benefits that are expected to result from the Herb Chambers acquisition will depend, in part, on our ability to integrate and realize the anticipated revenue and cost synergies from the Herb Chambers acquisition.
Illegal or unethical conduct by employees, customers, vendors, and unaffiliated third parties can result in loss of assets, disrupt operations, impact brand reputation, jeopardize manufacturer and other relationships, result in the imposition of fines or penalties, and subject us to governmental investigations or lawsuits.
Illegal or unethical conduct by employees, customers, vendors, and unaffiliated third parties can result in loss of assets, disrupt operations, impact brand reputation, jeopardize manufacturer and other relationships, result in the imposition of fines or penalties, and subject us to governmental investigations or lawsuits. While we maintain insurance to protect against various losses, this insurance coverage often contains significant deductibles.
If management is not able to effectively manage the integration process, or if any significant business activities are interrupted as a result of the integration process, our business, financial condition and results of operations could suffer.
If management is not able to effectively manage the integration process, including without limitation the rollout of our TCA products to the Herb Chambers dealerships and the transition of the Herb Chambers platform to Tekion,or if any significant business activities are interrupted as a result of the integration process, our business, financial condition and results of operations could suffer.
A decrease in our market capitalization or profitability increases the risk of goodwill impairment. The fair value of our manufacturer franchise rights is determined by discounting a subset of the projected cash flows at a dealership that we attribute to the value of the franchise.
The fair value of our manufacturer franchise rights is determined by discounting a subset of the projected cash flows at a dealership that we attribute to the value of the franchise. Changes to the business mix or declining cash flows in a dealership increase the risk of impairment.
However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our business, financial condition, results of operations and cash flows.
However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on our business, financial condition, results of operations and cash flows. We are subject to risks associated with imported product restrictions or limitations, foreign trade and currency valuations.
While we and the business partners and service providers on which we rely have experienced cybersecurity incidents in the past, and may experience additional incidents in the future, we are not aware of any incident having a material adverse effect on our business, results of operations or financial condition to date.
While we and the business partners and service providers on which we rely have experienced cybersecurity incidents in the past, and may experience additional incidents in the future, as of the date of this Annual Report on Form 10-K, we are not aware of any incident having a material adverse effect on our business, results of operations or financial condition to date. 28 Table of Contents However, there can be no assurance that we or the business partners and service providers on which we rely will not experience future cybersecurity incidents that may be material.
As of December 31, 2024, we had total debt of $3.16 billion and total floor plan notes payable, net of $1.69 billion.
As of December 31, 2025, we had total debt of $3.59 billion and total floor plan notes payable, net of $2.03 billion.
There can be no assurance that our initiatives and investments in digital channels will be successful or result in improved financial performance. We may not adequately anticipate all the demands that our growth will impose on our personnel, procedures and structures, including our financial and reporting control systems, information technology systems, data processing systems, and management structure.
We may not adequately anticipate all the demands that our growth will impose on our personnel, procedures and structures, including our financial and reporting control systems, information technology systems, data processing systems, and management structure.
There can be no assurance that the Company will succeed in either the FTC’s administrative proceeding against the Company or in the Company’s lawsuit against the FTC, and the FTC’s allegations, whether meritorious or not, may adversely affect our ability to attract customers, result in the loss of existing customers, harm our reputation and cause us to incur defense costs and other expenses. 29 Table of Contents Environmental laws and regulations govern, among other things, discharges into the air and water, storage of petroleum substances and chemicals, the handling and disposal of solid and hazardous wastes, investigation and remediation of contamination.
There can be no assurance that the Company will succeed in either the FTC’s administrative proceeding against the Company or in the Company’s lawsuit against the FTC, and the FTC’s allegations, whether meritorious or not, may adversely affect our ability to attract customers, result in the loss of existing customers, harm our reputation and cause us to incur defense costs and other expenses.
These risks include, but are not limited to: (i) failing to obtain manufacturers’ consents to acquisitions of additional franchises; (ii) manufacturers' requirements to divest certain franchises when acquiring additional franchises; (iii) incurring significant transaction-related costs for completed, failed and pending acquisitions; (iv) incurring significantly higher capital expenditures and operating expenses; (v) the inability to obtain the necessary financing in order to complete acquisitions; (vi) failing to successfully integrate the operations and personnel of the acquired dealerships and impairing relationships with employees; (vii) impairing relationships with employees of the acquired dealerships; (viii) incorrectly valuing entities to be acquired or incurring undisclosed liabilities at acquired dealerships; (ix) disrupting our ongoing business and diverting our management resources to newly acquired dealerships; (x) failing to achieve expected performance levels and financial results on a same store basis after integration; (xi) impairing relationships with manufacturers and customers as a result of changes in management; (xii) delays or difficulties related to our ability to obtain future necessary regulatory approvals for TCA in jurisdictions applicable to acquired dealerships; (xiii) difficulties in entering geographic markets in which we have no or limited direct prior experience; (xiv) failing to realize expected benefits and synergies from the transaction; and (xv) failing to implement or improve controls, policies and information systems and related security measures in the acquired businesses.
These risks include, but are not limited to: (i) failing to obtain manufacturers’ consents to acquisitions of additional franchises; (ii) incurring significant transaction-related costs for both completed and failed acquisitions; (iii) incurring significantly higher capital expenditures and operating expenses; (iv) failing to integrate the operations and personnel of the acquired dealerships and impairing relationships with employees; (v) incorrectly valuing entities to be acquired or incurring undisclosed liabilities at acquired dealerships; (vi) disrupting our ongoing business and diverting our management resources to newly acquired dealerships; (vii) failing to achieve 19 Table of Contents expected performance levels; (viii) impairing relationships with manufacturers and customers as a result of changes in management; (ix) failing to realize expected benefits and synergies from the transaction; and (ix) failing to implement or improve controls, policies and information systems and related security measures in the acquired businesses.
Market disruptors continue to push for legislation permitting direct-to-consumer sales models; if those lobbying efforts are successful, automotive manufacturers could bypass the traditional franchised dealer network, which in turn could materially adversely affect our business, results of operations, financial condition and cash flows.
Market disruptors continue to push for legislation permitting direct-to-consumer sales models; if those lobbying efforts are successful, automotive manufacturers could bypass the traditional franchised dealer network, which in turn could materially adversely affect our business, results of operations, financial condition and cash flows. 27 Table of Contents New laws, regulations, or governmental policies in response to climate change, including fuel economy and greenhouse gas emission standards, or changes to existing standards, could adversely impact our business, results of operations, financial condition, cash flow, and prospects.
We have historically experienced business interruptions from time to time at several of our dealerships, due to actual or threatened adverse weather conditions or natural disasters, such as hurricanes, earthquakes, tornadoes, floods, hail storms, fires or other extraordinary events. Concentration of property at dealership locations also makes the automotive retail business particularly vulnerable to theft, fraud and misappropriation of assets.
We have historically experienced business interruptions from time to time at several of our dealerships, due to actual or threatened adverse weather conditions or natural disasters, such as hurricanes, earthquakes, tornadoes, floods, hailstorms, fires or other extraordinary events.
The CFPB does not have direct regulatory authority over automotive dealers but could implement additional, indirect regulation of automotive dealers, in particular, their sale and marketing of finance and insurance products, through its regulation of automotive finance companies and other financial institutions.
If any of our employees were to engage in misconduct or were to be accused of such misconduct, our business and reputation could be adversely affected. 29 Table of Contents The CFPB does not have direct regulatory authority over automotive dealers but could implement additional, indirect regulation of automotive dealers, in particular, their sale and marketing of finance and insurance products, through its regulation of automotive finance companies and other financial institutions.
The Company vigorously disputed, and continues to vigorously dispute, the FTC’s allegations that it violated the FTC Act and the ECOA.
The Company vigorously disputed, and continues to vigorously dispute, the FTC’s allegations.
The occurrence of, or failure to remediate, this material weakness and any future material weaknesses in our internal control over financial reporting may adversely affect the accuracy, reliability and timeliness of our financial statements and have other consequences that could materially and adversely affect our business.
Failure to maintain effective internal control over financial reporting may adversely affect the accuracy and reliability of our financial statements and have other consequences that may materially and adversely affect our business.
In addition, if enrollment in our health care plans increases significantly, the additional costs that we will incur may be significant enough to materially affect our business, financial condition, results of operations and cash flows. 30 Table of Contents We are, and expect to continue to be, subject to legal and administrative proceedings, which, if the outcomes are adverse to us, could have a material adverse effect on our business, results of operations, financial condition, cash flows, reputation and prospects.
We are, and expect to continue to be, subject to legal and administrative proceedings, which, if the outcomes are adverse to us, could have a material adverse effect on our business, results of operations, financial condition, cash flows, reputation and prospects.
Risks Related to Our Business Operating Risks Disruptions in the production and delivery of new vehicles and parts from manufacturers due to the lack of availability of parts and key components from suppliers could have a material adverse effect on our business, results of operations, financial condition and cash flows.
In addition, other risks or uncertainties not presently known to us or that we currently do not deem material could arise, any of which could also materially adversely affect us. 18 Table of Contents Risks Related to Our Business Operating Risks Disruptions in the production and delivery of new vehicles and parts from manufacturers due to the lack of availability of parts and key components from suppliers could have a material adverse effect on our business, results of operations, financial condition and cash flows.
However, there can be no assurance that there will be sufficient revenue from such acquisitions to offset increased expenses and costs arising out of such acquisitions. When seeking to acquire other dealerships, we often compete with several other national, regional and local dealership groups, and other strategic and financial buyers, some of which may have greater financial resources than us.
When seeking to acquire other dealerships, we often compete with several other national, regional and local dealership groups, and other strategic and financial buyers, some of which may have greater financial resources than us.
If we are unable to retain our key personnel, we may be unable to successfully execute our business plans, which may have a material adverse effect on our business.
If we are unable to retain our key personnel, we may be unable to successfully execute our business plans, which may have a material adverse effect on our business. We may not realize the strategic benefits and cost synergies that are anticipated from the planned Herb Chambers acquisition.
Consumers are increasingly shopping for new and used vehicles, automotive repair and maintenance service and other automotive products and services online and through mobile applications, including through third-party online and mobile sales platforms, with which we compete, that are designed to generate consumer sales that are sold to automotive dealers.
Consumers are increasingly shopping for new and used vehicles, automotive repair and maintenance services and other automotive products and services online and through mobile applications, including through third-party online and mobile sales platforms, with which we compete. We have invested and will continue to invest in our omni-channel and other online applications in furtherance of our strategic vision.
Our business, operations, ability to implement our strategy, reputation, results of operations, financial condition, cash flows, and prospects may be materially adversely affected by the risks described below. In addition, other risks or uncertainties not presently known to us or that we currently do not deem material could arise, any of which could also materially adversely affect us.
Our business, operations, ability to implement our strategy, reputation, results of operations, financial condition, cash flows, and prospects may be materially adversely affected by the risks described below.
We may obtain new vehicles from manufacturers, service vehicles, sell new vehicles and display vehicle manufacturers’ trademarks only to the extent permitted under these agreements.
We may obtain new vehicles from manufacturers, service vehicles, sell new vehicles and display vehicle manufacturers’ trademarks only to the extent permitted under these agreements. The terms of these agreements may conflict with our interests and objectives and may impose limitations on key aspects of our operations, including acquisition strategy and capital spending.
The terms of these agreements may conflict with our interests and objectives and may impose limitations on key aspects of our operations, including acquisition strategy and capital spending. 23 Table of Contents For example, manufacturers can set performance standards with respect to sales volume, sales effectiveness and customer satisfaction, and require us to obtain manufacturer consent before we can acquire dealerships selling a manufacturer’s automobiles.
For example, manufacturers can set performance standards with respect to sales volume, sales effectiveness and customer satisfaction, and require us to obtain manufacturer consent before we can acquire dealerships selling a manufacturer’s automobiles.
The Company’s lawsuit also contends that FTC commissioners and in-house administrative law judges are effectively insulated from removal by the President in contravention of the Constitution’s requirements. At this time, we are unable to reasonably predict the possible outcome of the Company’s dispute with the FTC, or provide a reasonably possible range of loss, if any.
We are unable to reasonably predict the possible outcome of the Company’s dispute with the FTC at this time, or provide a reasonably possible range of loss, if any.
Changes to the business mix or declining cash flows in a dealership increase the risk of impairment. During the year ended December 31, 2024, we recognized asset impairment charges of $149.5 million associated with manufacturer franchise rights recorded at certain dealerships and goodwill associated with certain asset disposal groups.
During the year ended December 31, 2025, we recognized asset impairment charges of $141.0 million associated with manufacturer franchise rights recorded at certain dealerships and goodwill associated 20 Table of Contents with certain asset disposal groups.
Competition for attractive acquisition targets may result in fewer acquisition opportunities for us and we may have to forgo acquisition opportunities to the extent we cannot negotiate such acquisitions on acceptable terms. The integration processes require us to expend significant capital and significantly expand the scope of our operations and financial systems.
Competition for attractive acquisition targets may result in fewer acquisition opportunities for us and we may have to forgo acquisition opportunities to the extent we cannot negotiate such acquisitions on acceptable terms. We also face additional risks commonly encountered with growth through acquisitions.
Integration also requires 18 Table of Contents support or other actions by third parties such as vendors, suppliers, and licensing agencies, and the untimely or inadequate responses from such third parties can delay or otherwise negatively impact integration processes. We also face additional risks commonly encountered with growth through acquisitions.
The integration processes require us to expend significant capital and significantly expand the scope of our operations and financial systems. Integration also requires support or other actions by third parties such as vendors, suppliers, and licensing agencies and the untimely or inadequate responses from such third parties can delay or otherwise negatively impact the integration process.
Furthermore, we may decide to alter or discontinue aspects of our strategic plan and may adopt alternative or additional strategies in response to business or competitive factors or other factors or events beyond our control. 19 Table of Contents We cannot give assurance that we will be able to execute a substantial portion of our strategic plan which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.
We cannot give assurance that we will be able to execute a substantial portion of our strategic plan which could have a material adverse effect on our business, financial condition, results of operations, and cash flows. Goodwill and manufacturer franchise rights comprise a significant portion of our total assets.
We are subject to risks associated with imported product restrictions or limitations, foreign trade and currency valuations. Our business involves the sale of vehicles, parts or vehicles composed of parts that are manufactured outside of the United States.
Our business involves the sale of vehicles, parts or vehicles composed of parts that are manufactured outside of the United States.
The loss of key personnel and limited management and personnel resources could adversely affect our business. Our success depends, to a significant degree, upon the continued contributions of our management team, and service and sales personnel.
The loss or transition of key personnel and limited management and personnel resources could adversely affect our business.
Recently, inflation has increased throughout the U.S. economy. Inflation can adversely affect us by increasing the costs of labor, fuel and other costs as well as by reducing demand for automobiles. Sales of certain vehicles, particularly trucks and sport utility vehicles that historically have provided us with higher gross profit per vehicle retailed, may be sensitive to fuel prices.
Inflation continues to be an issue throughout the U.S. economy. Inflation can adversely affect us by increasing the costs of labor, fuel and other costs as well as by reducing demand for automobiles.
We have invested and will continue to invest in our omni-channel and other online applications in furtherance of our strategic vision. We face increased competition for market share from other automotive retailers and other sales platforms that have also invested in digital channels.
We face increased competition for market share from other automotive retailers and other sales platforms that have also invested in digital channels. There can be no assurance that our initiatives and investments in digital channels will be successful or result in improved financial performance.
In addition, rapid changes in fuel prices can cause shifts in consumer preferences which are difficult to accommodate given the long lead-time of inventory acquisition. Inflation is also often accompanied by higher interest rates, which could reduce the fair value of our outstanding debt obligations.
Inflation is also often accompanied by higher interest rates, which could reduce the fair value of our outstanding debt obligations.
New laws, regulations, or governmental policies in response to climate change, including fuel economy and greenhouse gas emission standards, or changes to existing standards, could adversely impact our business, results of operations, financial condition, cash flow, and prospects. New laws and regulations designed to address climate change concerns could affect vehicle manufacturers’ ability to produce cost effective vehicles.
New laws and regulations designed to address climate change concerns could affect vehicle manufacturers’ ability to produce cost effective vehicles.
There is a significant degree of difficulty and management distraction inherent in the process of integrating an acquisition.
Additionally, there is a significant degree of difficulty and management distraction inherent in the process of transitioning a key information system, and there are short-term productivity losses at the store level due to learning a new information system.
We have piloted a new DMS, and the inability to successfully transition from our existing DMS to a new DMS could 27 Table of Contents have a material adverse effect on the management of our day-to-day business activities.
The failure of a key information system, the inability to successfully transition between key information systems, or our ability to successfully incorporate new technologies could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Removed
While we maintain insurance to protect against a number of losses, this insurance coverage often contains significant deductibles.
Added
For example, in 2024, Hurricanes Helene and Milton impacted store operations in Florida, Georgia, and South Carolina, leading to temporary store closures and reduced customer traffic. Concentration of property at dealership locations also makes the automotive retail business particularly vulnerable to theft, fraud and misappropriation of assets.
Removed
The Herb Chambers Dealerships acquisition may not occur at all or may not occur in the expected time frame, which may negatively affect the trading price of our common stock and our future business and financial results.
Added
Furthermore, we may decide to alter or discontinue aspects of our strategic plan and may adopt alternative or additional strategies in response to business or competitive factors or other factors or events beyond our control.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Our CIO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity incidents pursuant to criteria set forth in the Company’s incident response plan and related processes.
Our CIO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity incidents pursuant to criteria set forth in the Company’s data incident response plan and related processes.
The audit committee is informed of material risks from cybersecurity threats pursuant to the escalation criteria as set forth in the Company’s disclosure controls and procedures.
The audit committee is informed of material risks from cybersecurity threats pursuant to the escalation criteria set forth in the Company’s disclosure controls and procedures.
In addition, the audit committee and capital allocation and risk management committee hold a joint meeting annually during which the CIO provides a comprehensive update regarding the assessment and management of material cybersecurity risks. Our CIO also provides updates as appropriate to the Company’s Board of Directors.
In addition, the audit committee and capital allocation and risk management committee hold a joint meeting annually during which the CIO provides a comprehensive update regarding the assessment and management of material cybersecurity risks. Our CIO also provides ad hoc updates as appropriate to the Company’s Board of Directors.
Our cybersecurity capabilities, processes, and other security measures also include, without limitation: • Service Organization Controls ("SOC")-as-a-Service (SOCaas) wherein a third-party vendor operates and maintains a fully-managed SOC on a subscription basis via the cloud; • Security Information and Event Management ("SIEM") software, which provides a threat detection, compliance, and security incident management system; • Endpoint Detection and Response ("EDR") software, which monitors for malicious activities on internal endpoints (e.g., Windows workstations, servers, MAC clients, and Linux endpoints); • Cloud monitoring; and • Disaster recovery and incident response plans, including a ransomware response plan.
Our cybersecurity capabilities, processes, and other security measures also include, without limitation: • Service Organization Controls ("SOC")-as-a-Service (SOCaas) wherein a third-party vendor operates and maintains a fully managed SOC on a subscription basis via the cloud; • Security Information and Event Management (“SIEM”) software, which provides a threat detection, compliance, and security incident management system; • Endpoint Detection and Response (“EDR”) software, which monitors for malicious activities on internal endpoints (e.g., Windows workstations, servers, MAC clients, and Linux endpoints); • Cloud monitoring; and • Disaster recovery and incident response plans, including a ransomware response plan.
As of the date of this Form 10-K, no cybersecurity incident or attack, or any risk from 32 Table of Contents cybersecurity threat, has materially affected or has been determined to be reasonably likely to materially affect the Company, our business strategy, results of operations, or financial condition.
As of the date of this Form 10-K, no cybersecurity incident, or any risk from cybersecurity threat, has materially affected or has been determined to be reasonably likely to materially affect the Company, our business strategy, results of operations, or financial condition.
We, or the business partners or services providers on which we rely, have experienced cybersecurity incidents in the past that have resulted in disruptions, technology failures, or unauthorized persons gaining access to certain information systems, and we could in the future experience similar incidents.
We, as well as the business partners or services providers on which we rely, have experienced cybersecurity incidents in the past that have resulted in disruptions, technology failures, or unauthorized people gaining access to certain information systems, and we could in the future experience similar incidents.
The Company from time to time engages third-party consultants, legal advisors, and audit firms in evaluating and testing the Company’s risk management systems and assessing and remediating certain potential cybersecurity incidents as appropriate.
The Company from time to time engages 32 Table of Contents third-party consultants, legal advisors, and audit firms in evaluating and testing the Company’s risk management systems and assessing and remediating certain potential cybersecurity incidents as appropriate.
Internally, among other things, we may perform penetration tests, internal tests/code reviews, and simulations using cybersecurity professionals to assess vulnerabilities in our information systems and evaluate our cyber defense capabilities.
Internally, among other things, we perform two penetration tests per year, internal tests/code reviews, and simulations using cybersecurity professionals to assess vulnerabilities in our information systems and evaluate our cyber defense capabilities.
For further discussion of the risks associated with cybersecurity incidents, see " A failure of any of our information systems or those of our third-party service providers, or a data security breach with regard to personally identifiable information ("PII") about our customers or employees, could have a material adverse effect on our business, results of operations, financial condition and cash flows.
For further discussion of the risks associated with cybersecurity incidents, see “ A failure of any of our information systems or those of our third-party service providers, or a data security breach with regard to personally identifiable information ("PII") about our customers or employees, could have a material adverse effect on our business, results of operations, financial condition and cash flows.” beginning on page 28 of the section entitled “Item 1A.
Asbury’s information and data security training programs are housed in a Learning Management System ("LMS"). We migrate our acquired companies into Asbury’s current LMS. Governance Our Chief Information Officer ("CIO"), who has over 35 years of experience in the technology field, oversees cybersecurity, data privacy and manages Asbury’s information and security procedures.
Asbury’s information and data security training programs are housed in a Learning Management System ("LMS"). We migrate our acquired companies into Asbury’s current LMS. Governance Our Chief Information Officer (“CIO”) oversees cybersecurity, data privacy and manages Asbury’s information and security procedures. Asbury also has a Director of Cybersecurity, as well as a formal team of analysts.
Asbury also has a Director of Cybersecurity, as well as a formal team of analysts. 31 Table of Contents Our Board of Directors maintains ultimate oversight of the Company’s enterprise risk management program, which includes material cyber security risks.
Our Board of Directors maintains ultimate oversight of the Company’s enterprise risk management program, which includes material cybersecurity risks.
Removed
For additional information regarding the risks from cybersecurity threats we face, see the section captioned.
Removed
" beginning on page 27 of the section entitled "Item 1A. Risk Factors" in this Form 10-K.

Item 2. Properties

Properties — owned and leased real estate

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(b) Includes one dealership location where we lease the underlying land but own the building facilities on that land. (c) Includes two dealership location where we lease the underlying land but own the building facilities on that land.
(b) Includes one dealership location where we lease the underlying land but own the building facilities on that land. (c) Includes two dealership locations where we lease the underlying land but own the building facilities on that land.
Miller Dealerships 41 4 (b) 7 2 Mike Shaw, Stevinson & Arapahoe Automotive Groups 8 4 — — Nalley Automotive Group 14 1 4 1 Park Place Automotive 5 4 (c) 2 1 Plaza Motor Company 5 1 (b) — 1 Total 128 24 29 8 ______________________________________ (a) Includes one dealership that leases a new vehicle facility and operates a separate used vehicle facility that is owned.
Miller Dealerships 32 4 6 2 Mike Shaw, Stevinson & Arapahoe Automotive Groups 7 4 — — Nalley Automotive Group 14 1 4 1 Park Place Automotive 5 4 (c) 2 1 Plaza Motor Company 5 1 (b) — 1 Total 142 29 31 8 ______________________________________ (a) Includes one dealership that leases a new vehicle facility and operates a separate used vehicle facility that is owned.
As of December 31, 2024, our operations encompassed 152 franchised dealership locations, 37 collision repair centers, throughout 14 states as follows: Dealerships Collision Repair Centers Dealership Group Brand Name: Owned Leased Owned Leased Coggin Automotive Group 12 4 (a) 5 2 Courtesy Autogroup 6 2 2 — Crown Automotive Company 3 1 (b) — — David McDavid Auto Group 4 — 2 — Greenville Automotive Group 4 1 1 — Hare, Bill Estes & Kahlo Automotive Groups 9 — 1 — Koons Automotive Group 17 2 5 1 Larry H.
As of December 31, 2025, our operations encompassed 171 franchised dealership locations, 39 collision repair centers, throughout 15 states as follows: 33 Table of Contents Dealerships Collision Repair Centers Dealership Group Brand Name: Owned Leased Owned Leased Coggin Automotive Group 12 4 (a) 5 2 Courtesy Autogroup 6 2 2 — Crown Automotive Company 3 2 (b) — — David McDavid Auto Group 4 — 2 — Greenville Automotive Group 3 — 1 — Hare, Bill Estes & Kahlo Automotive Groups 7 — 1 — Herb Chambers Dealerships 28 5 3 — Koons Automotive Group 16 2 5 1 Larry H.
We also have a corporate office in Texas. The operations of our TCA business are located in leased office space in Utah.
Item 2. Properties We own our corporate headquarters, which is located at 6655 Peachtree Dunwoody Road, Atlanta, Georgia 30328. We also have a corporate office in Texas. The operations of our TCA business are located in leased office space in Utah. We believe that our facilities are in good condition and meet our current business needs.
Removed
Item 2. Properties We lease our corporate headquarters, which is located at 2905 Premiere Parkway, NW, Suite 300, Duluth, Georgia 30097. In November 2024, we acquired real estate in Sandy Springs, Georgia to serve as our future corporate headquarters. We anticipate the relocation to our new corporate headquarters during the second half of 2025.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Among other things, the Company’s lawsuit asserts that the FTC’s administrative proceeding violates Asbury’s constitutional rights by denying it the right to a jury trial and by allowing the FTC to serve as both prosecutor and judge in the same proceeding.
Among other things, the Company’s lawsuit asserts that the FTC’s administrative proceeding violates the Company’s constitutional rights by denying it the right to a jury trial and by allowing the FTC to serve as both prosecutor and judge in the same proceeding.
There can be no assurance that the Company will succeed in either the FTC’s administrative proceeding against the Company or in the Company’s lawsuit against the FTC, and the FTC’s allegations, whether meritorious or not, may adversely affect our ability to attract customers, result in the loss of existing customers, harm our reputation and cause us to incur defense costs and other expenses.
There can 34 Table of Contents be no assurance that the Company will succeed in either the FTC’s administrative proceeding against the Company or in the Company’s lawsuit against the FTC, and the FTC’s allegations, whether meritorious or not, may adversely affect our ability to attract customers, result in the loss of existing customers, harm our reputation and cause us to incur defense costs and other expenses.
On August 3, 2022, we received a Civil Investigative Demand ("CID") from the Federal Trade Commission (the "FTC") requesting information and documents concerning the Company’s corporate structure and operation of six of its dealerships. We responded to the CID by producing information and documents for the period August 1, 2019 to April 24, 2023.
On August 3, 2022, we received a Civil Investigative Demand (“CID”) from the Federal Trade Commission (the “FTC”) requesting information and documents concerning the Company’s corporate structure and operation of six of its dealerships. We responded to the CID by producing information and documents for the period August 1, 2019 to April 24, 2023.
On February 8, 2024, the FTC staff counsel sent to us a proposed consent order and draft complaint, alleging that the Company and 33 Table of Contents three of our dealerships had violated Section 5 of the Federal Trade Commission Act ("FTC Act") and certain provisions of the Equal Credit Opportunity Act ("ECOA") in connection with the sale of add-on products (e.g., vehicle service contracts, maintenance plans, etc.), and advising that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.
On February 8, 2024, the FTC staff counsel sent to us a proposed consent order and draft complaint, alleging that the Company and three of our dealerships had violated Section 5 of the Federal Trade Commission Act (“FTC Act”) and certain provisions of the Equal Credit Opportunity Act in connection with the sale of add-on products (e.g., vehicle service contracts, maintenance plans, etc.), and advising that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.
The Company vigorously disputed, and continues to vigorously dispute, the FTC’s allegations that it violated the FTC Act and the ECOA.
The Company vigorously disputed, and continues to vigorously dispute, the FTC’s allegations.
The Company’s lawsuit also contends that FTC commissioners and in-house administrative law judges are effectively insulated from removal by the President in contravention of the Constitution’s requirements. At this time, we are unable to reasonably predict the possible outcome of the Company’s dispute with the FTC, or provide a reasonably possible range of loss, if any.
We are unable to reasonably predict the possible outcome of the Company’s dispute with the FTC at this time, or provide a reasonably possible range of loss, if any.
Removed
Item 4. Mine Safety Disclosures Not applicable. 34 Table of Contents PART II
Added
The Company’s lawsuit also contends that FTC commissioners and in-house administrative law judges are effectively insulated from removal by the President in contravention of the Constitution’s requirements. The FTC’s administrative proceeding and the Company’s lawsuit remain pending.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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The market-weighted Peer Group Index values were calculated from the beginning of the performance period. The historical stock performance shown below is not necessarily indicative of future expected performance. The forgoing graph is not, and shall not be deemed to be, filed as part of our annual report on Form 10-K.
The market-weighted Peer Group Index values were calculated from the beginning of the performance period. The historical stock performance shown below is not necessarily indicative of future expected performance. The foregoing graph is not, and shall not be deemed to be, filed as part of our annual report on Form 10-K.
Such graph is not, and will not be deemed, filed or incorporated by reference into any filing by us under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent specifically incorporated by reference therein by us. 36 Table of Contents Item 6. Reserved
Such graph is not, and will not be deemed, filed or incorporated by reference into any filing by us under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent specifically incorporated by reference therein by us. 37 Table of Contents Item 6. Reserved
The program does not require the Company to repurchase any specific number of shares, and may be modified, suspended or terminated at any time without further notice. 35 Table of Contents PERFORMANCE GRAPH The following graph furnished by us shows the value as of December 31, 2024, of a $100 investment in our common stock made on December 31, 2019, as compared with similar investments based on (i) the value of the S&P 500 Index (with dividends reinvested) and (ii) the value of a market-weighted Peer Group Index composed of the common stock of AutoNation, Inc.; Sonic Automotive, Inc.; Group 1 Automotive, Inc.; Penske Automotive Group, Inc.; and Lithia Motors, Inc., in each case on a "total return" basis assuming the reinvestment of any dividends.
The program does not require the Company to repurchase any specific number of shares, and may be modified, suspended or terminated at any time without further notice. 36 Table of Contents PERFORMANCE GRAPH The following graph furnished by us shows the value as of December 31, 2025, of a $100 investment in our common stock made on December 31, 2020, as compared with similar investments based on (i) the value of the S&P 500 Index (with dividends reinvested) and (ii) the value of a market-weighted Peer Group Index composed of the common stock of AutoNation, Inc.; Sonic Automotive, Inc.; Group 1 Automotive, Inc.; Penske Automotive Group, Inc.; and Lithia Motors, Inc., in each case on a "total return" basis assuming the reinvestment of any dividends.
Information about the shares of our common stock that we repurchased during the quarter ended December 31, 2024 is set forth below: Period Total Number of Shares (or Units) Purchased Average Price Paid per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (In millions 10/01/2024 - 10/31/2024 3,957 $ 219.97 3,957 $ 275.9 11/01/2024 - 11/30/2024 206 $ 255.29 — $ 275.9 12/01/2024 - 12/31/2024 24 $ 258.98 — $ 275.9 Total 4,187 3,957 On May 15, 2024, the Company announced that its Board of Directors approved an increase of $256.2 million in the Company's common share repurchase authorization to $400 million (the "New Share Repurchase Authorization"), for the repurchase of our common stock in open market transactions or privately negotiated transactions or in other manners as permitted by federal securities laws and other legal and contractual requirements.
Information about the shares of our common stock that we repurchased during the quarter ended December 31, 2025 is set forth below: Period Total Number of Shares (or Units) Purchased Average Price Paid per Share (or Unit) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs (In millions) 10/01/2025 - 10/31/2025 92,917 $ 238.77 92,917 $ 203.7 11/01/2025 - 11/30/2025 119,341 $ 233.04 119,248 $ 175.9 12/01/2025 - 12/31/2025 50 $ 226.92 — $ 175.9 Total 212,308 212,165 On May 15, 2024, the Company announced that its Board of Directors approved an increase of $256.2 million in the Company's common share repurchase authorization to $400.0 million (the "New Share Repurchase Authorization"), for the repurchase of our common stock in open market transactions or privately negotiated transactions or in other manners as permitted by federal securities laws and other legal and contractual requirements.
On February 24, 2025, the last reported sale price of our common stock on the NYSE was $274.15 per share, and there were approximately 511 record holders of our common stock. Our credit agreement with Bank of America, N.A.
On February 18, 2026, the last reported sale price of our common stock on the NYSE was $229.78 per share, and there were approximately 506 record holders of our common stock. Our credit agreement with Bank of America, N.A.
Added
As of December 31, 2025, we had remaining authorization to repurchase up to an additional $175.9 million of our common stock. Any repurchases will be subject to applicable limitations in our debt or other financing agreements that may be in existence from time to time.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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The $16.9 million decrease in adjusted cash flow provided by operating activities for the year ended December 31, 2024 compared to the year ended December 31, 2023, was primarily the result of the following: • decrease in $86.6 million in net income and non-cash adjustments to net income; • $100.9 million decrease related to the change in accounts payable and accrued liabilities; and • $24.8 million related to a decrease in inventory, net of floor plan notes payable, including both trade and non-trade, excluding offset and including used vehicle borrowing base changes adjusted for acquisitions and divestitures.
The $16.9 million decrease in our adjusted cash flow provided by operating activities for the year ended December 31, 2024 compared to the year ended December 31, 2023, was primarily the result of the following: • decrease of $86.6 million in net income and non-cash adjustments to net income; • $100.9 million decrease related to the change in accounts payable and accrued liabilities; and • $24.8 million related to a decrease in inventory, net of floor plan notes payable, including both trade and non-trade, excluding offset and including used vehicle borrowing base changes adjusted for acquisitions and divestitures.
On May 15, 2024, the Company announced that its Board of Directors approved an increase of $256.2 million in the Company's common share repurchase authorization to $400 million (the "New Share Repurchase Authorization"), for the repurchase of our common stock in open market transactions or privately negotiated transactions or in other manners as permitted by federal securities laws and other legal and contractual requirements.
On May 15, 2024, the Company announced that its Board of Directors approved an increase of $256.2 million in the Company's common share repurchase authorization to $400.0 million (the "New Share Repurchase Authorization"), for the repurchase of our common stock in open market transactions or privately negotiated transactions or in other manners as permitted by federal securities laws and other legal and contractual requirements.
We have provided below a reconciliation of cash flow provided by operating activities, as if all changes in floor plan notes payable, except for (i) borrowings associated with acquisitions and repayments associated with divestitures and (ii) borrowings and repayments associated with the purchase of used vehicle inventory and (iii) changes in the floorplan offset accounts were classified as an operating activity for both floorplan notes payable - non-trade and floor plan notes payable - trade.
We have provided below a reconciliation of cash flow provided by operating activities, as if all changes in floor plan notes payable, except for (i) borrowings associated with acquisitions and repayments associated with divestitures and (ii) borrowings and repayments associated with the purchase of used vehicle inventory and (iii) changes in the floor plan offset accounts were classified as an operating activity for both floor plan notes payable - non-trade and floor plan notes payable - trade.
The majority of our floor plan notes are payable to parties unaffiliated with the entities from which we purchase our new vehicle inventory, with the exception of floor plan notes payable relating to the financing of new Ford and Lincoln vehicles. We did not have any dealership acquisitions in 2024 and 2022.
The majority of our floor plan notes are payable to parties unaffiliated with the entities from which we purchase our new vehicle inventory, with the exception of floor plan notes payable relating to the financing of new Ford and Lincoln vehicles. We did not have any dealership acquisitions in 2024.
As explained in Note 14 of the Company's consolidated financial statements as of and for the year ended December 31, 2024, the Senior Notes have been fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis, by each existing and future restricted subsidiary of the Company (the "Guarantor Subsidiaries"), which are listed in Exhibit 21, with the exception of Landcar Administration Company, Landcar Agency, Inc. and Landcar Casualty Company and their respective subsidiaries (collectively, the "TCA Non-Guarantor Subsidiaries").
As explained in Note 14 of the Company's consolidated financial statements as of and for the year ended December 31, 2025, the Senior Notes have been fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis, by each existing and future restricted subsidiary of the Company (the "Guarantor Subsidiaries"), which are listed in Exhibit 21, with the exception of Landcar Administration Company, Landcar Agency, Inc. and Landcar Casualty Company and their respective subsidiaries (collectively, the "TCA Non-Guarantor Subsidiaries").
The representations and covenants contained in the 2021 Real Estate Facility, 2021 BofA Real Estate Credit Agreement, 2018 BofA Real Estate Credit Agreement, 2018 Wells Fargo Master Loan Agreement, 2015 Wells Fargo Master Loan Agreement, and the related documents are customary for financing transactions of this nature, including, among others, requirements to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case, as applicable.
The representations and covenants contained in the 2021 Real Estate Facility, 2021 BofA Real Estate Credit Agreement, 2018 BofA Real Estate Credit Agreement, 2018 Wells Fargo Master Loan Agreement, the 2025 Real Estate Facility, and the related documents are customary for financing transactions of this nature, including, among others, requirements to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case, as applicable.
Contractual Obligations As of December 31, 2024, we had significant contractual obligations related to our floor plan notes payable disclosed in Notes 11 and 12, operating lease liabilities disclosed in Note 19 and long-term debt arrangements discussed in Note 14. Disclosures related to our commitments and contingencies are outlined in Note 21.
Contractual Obligations As of December 31, 2025, we had significant contractual obligations related to our floor plan notes payable disclosed in Notes 11 and 12, operating lease liabilities disclosed in Note 19 and long-term debt arrangements discussed in Note 14. Disclosures related to our commitments and contingencies are outlined in Note 21.
The proceeds of the September 2020 Offering were used to redeem certain seller notes issued in connection with the acquisition of Park Place. 58 Table of Contents The 2028 Notes and the 2030 Notes are guaranteed, jointly and severally, on a senior unsecured basis, by each of our existing and future restricted subsidiaries, other than the TCA Non-Guarantor Subsidiaries.
The proceeds of the September 2020 Offering were used to redeem certain seller notes issued in connection with the acquisition of Park Place. The 2028 Notes and the 2030 Notes are guaranteed, jointly and severally, on a senior unsecured basis, by each of our existing and future restricted subsidiaries, other than the TCA Non-Guarantor Subsidiaries.
The representations and covenants contained in the agreement governing the 2023 Senior Credit Facility are customary for financing transactions of this nature including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the agreement governing the 2023 Senior Credit Facility.
The representations and covenants contained in the agreement governing the 2023 Senior Credit Facility are customary for financing transactions of this nature including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the agreement 52 Table of Contents governing the 2023 Senior Credit Facility.
Adjusted cash flow provided by operating activities may not be comparable to similarly titled measures of other companies and should not be considered in isolation, or as a substitute for 61 Table of Contents analysis of our operating results in accordance with GAAP. In order to compensate for these potential limitations we also review the related GAAP measures.
Adjusted cash flow provided by operating activities may not be comparable to similarly titled measures of other companies and should not be considered in isolation, or as a substitute for analysis of our operating results in accordance with GAAP. In order to compensate for these potential limitations, we also review the related GAAP measures.
On December 11, 2023, we completed the acquisition of the Jim Koons Dealerships for a total purchase price of approximately $1.50 billion, which includes $256.1 million of new vehicle floor plan financing and $100.9 million of assets held for sale related to Koons Lexus of Wilmington.
On December 11, 2023, we completed the acquisition of the Jim Koons Dealerships for a total purchase price of approximately $1.50 billion, which includes $256.1 million of new vehicle floor plan financing and $100.9 million of assets 55 Table of Contents held for sale related to Koons Lexus of Wilmington.
Furthermore, to the extent that any agreements evidencing our manufacturer franchise rights would expire, we expect that we would be able to renew those agreements in the ordinary course of business. 65 Table of Contents We do not amortize goodwill and other intangible assets that are deemed to have indefinite lives.
Furthermore, to the extent that any agreements evidencing our manufacturer franchise rights would expire, we expect that we would be able to renew those agreements in the ordinary course of business. We do not amortize goodwill and other intangible assets that are deemed to have indefinite lives.
("Bank of America"), as administrative agent, and the other lenders party thereto (the "2023 Senior Credit Facility"). The 2023 Senior Credit Facility amended and restated the Company’s pre-existing third amended and restated credit agreement, dated as of September 25, 2019, among the Company, certain of its subsidiaries, Bank of America, as administrative agent, and the other lenders party thereto.
The 2023 Senior Credit Facility amended and 49 Table of Contents restated the Company’s pre-existing third amended and restated credit agreement, dated as of September 25, 2019, among the Company, certain of its subsidiaries, Bank of America, as administrative agent, and the other lenders party thereto.
Cash flows related to floor plan notes payable included in operating activities differ from cash flows related to floor plan notes payable included in financing activities only to the extent that the former are payable to a lender affiliated with the manufacturer from which we purchased the related inventory, while the latter are payable to our 2023 Senior Credit Facility that includes lenders affiliated with the manufacturers and lenders not affiliated with the manufacturers from which we purchased the related inventory.
Cash flows related 53 Table of Contents to floor plan notes payable included in operating activities differ from cash flows related to floor plan notes payable included in financing activities only to the extent that the former are payable to a lender affiliated with the manufacturer from which we purchased the related inventory, while the latter are payable to our 2023 Senior Credit Facility that includes lenders affiliated with the manufacturers and lenders not affiliated with the manufacturers from which we purchased the related inventory.
We have determined, based on how we integrate acquisitions into our business, how the components of our business share resources and interact with one another, and how we review the results of our operations, that we have several geographic region-based operating segments.
We have determined, based on how we integrate acquisitions into our business, how the components of our business 57 Table of Contents share resources and interact with one another, and how we review the results of our operations, that we have several geographic region-based operating segments.
As of December 31, 2024, we had remaining authorization to repurchase up to an additional $275.9 million of our common stock. Any repurchases will be subject to applicable limitations in our debt or other financing agreements that may be in existence from time to time.
As of December 31, 2025, we had remaining authorization to repurchase up to an additional $175.9 million of our common stock. Any repurchases will be subject to applicable limitations in our debt or other financing agreements that may be in existence from time to time.
For all reporting units, for which a qualitative or quantitative impairment test was performed as of October 1, 2024, the fair values exceeded their carrying amounts. We believe that the fair value of our reporting units is substantially in excess of its carrying amount.
For all reporting units, for which a qualitative impairment test was performed as of October 1, 2025, the fair values exceeded their carrying amounts. We believe that the fair value of our reporting units is substantially in excess of its carrying amount.
Direct expenses incurred for the acquisition of F&I contracts on which revenue has not yet been recognized have been deferred and are amortized over the related contract period. During the years ended December 31, 2024 and 2023, TCA recorded $54.4 million and $37.9 million, respectively, of cost of sales consisting primarily of claims expense paid to affiliated dealerships.
Direct expenses incurred for the acquisition of F&I contracts on which revenue has not yet been recognized have been deferred and are amortized over the related contract period. During the years ended December 31, 2025 and 2024, TCA recorded $52.5 million and $54.4 million, respectively, of cost of sales consisting primarily of claims expense paid to affiliated dealerships.
Used Vehicle Floor Plan Facility — A $375.0 million Used Vehicle Floor Plan Facility to finance the acquisition of used vehicle inventory and for working capital and capital expenditures, as well as to refinance used vehicles. We began the year with $307.1 million amounts drawn on our Used Vehicle Floor Plan Facility.
Used Vehicle Floor Plan Facility — A $375.0 million Used Vehicle Floor Plan Facility to finance the acquisition of used vehicle inventory and for working capital and capital expenditures, as well as to refinance used vehicles. We began the year with $100.7 million amounts drawn on our Used Vehicle Floor Plan Facility.
We expect that capital expenditures during 2025 will total approximately $260.3 million to upgrade or replace our existing facilities, construct new facilities, expand our service capacity, and invest in technology and equipment. In addition, as part of our capital allocation strategy, we continually evaluate opportunities to purchase properties currently under lease and acquire properties in connection with future dealership relocations.
We expect that capital expenditures during 2026 will total approximately $250.0 million to upgrade or replace our existing facilities, construct new facilities, expand our service capacity, and invest in technology and equipment. In addition, as part of our capital allocation strategy, we continually evaluate opportunities to purchase properties currently under lease and acquire properties in connection with future dealership relocations.
Guarantor Financial Information As of December 31, 2024, the Company had outstanding $405 million of 4.500% Senior Notes due 2028 and $445 million of 4.750% Senior Notes due 2030.
Guarantor Financial Information As of December 31, 2025, the Company had outstanding $405.0 million of 4.500% Senior Notes due 2028 and $445.0 million of 4.750% Senior Notes due 2030.
Adjustments related to cash flows associated with our used vehicle borrowing base, floorplan offset accounts and the impact of acquisitions and divestitures eliminates cash flow volatility and provides an adjusted operating cash flow metric that best reflects our results of operations and our management of inventory and related financing activities.
We believe that the adjustments related to cash flows associated with our used vehicle borrowing base, floor plan offset accounts and the impact of acquisitions and divestitures eliminates cash flow volatility and provides an adjusted operating cash flow metric that best reflects our results of operations and our management of inventory and related financing activities.
Borrowings of floor plan notes payable associated with inventory acquired in connection with all acquisitions and repayments made in connection with all divestitures are classified as a financing activity in the accompanying consolidated statement of cash flows.
Borrowings of non-trade floor plan notes payable associated with inventory acquired in connection with all acquisitions and repayments made in connection with all divestitures are classified as a financing activity in the accompanying consolidated statements of cash flows.
We ended the year with approximately 49 days of supply of new vehicle inventory which reflects an increase from 43 days of supply as of December 31, 2023 but remains well below historical levels.
We ended the year with approximately 52 days of supply of new vehicle inventory which reflects an increase from 49 days of supply as of December 31, 2024, but remains well below historical levels.
The 2029 Senior Notes and 2032 Senior Notes mature on November 15, 2029 and February 15, 2032, respectively. Interest is payable semiannually, on November 15 and May 15 of each year.
The 2029 Senior Notes and 2032 Senior Notes mature on November 15, 2029 and February 15, 2032, respectively. Interest is payable semiannually, on 50 Table of Contents November 15 and May 15 of each year.
As of December 31, 2024, we had $62.2 million, outstanding borrowings under the 2018 Wells Fargo Master Loan Facility. There is no further borrowing availability under the 2018 Wells Fargo Master Loan Facility.
As of December 31, 2025, we had $57.2 million outstanding borrowings under the 2018 Wells Fargo Master Loan Facility. There is no further borrowing availability under the 2018 Wells Fargo Master Loan Facility.
We were in compliance with all of our covenants as of December 31, 2024.
We were in compliance with all of our covenants as of December 31, 2025.
The seasonally adjusted annual rate ("SAAR") for new vehicle sales in the U.S. during the year ended December 31, 2024 was approximately 15.8 million which increased as compared to approximately 15.4 million during the year ended December 31, 2023.
The seasonally adjusted annual rate ("SAAR") for new vehicle sales in the U.S. during the year ended December 31, 2025 was approximately 16.2 million which increased as compared to approximately 15.8 million during the year ended December 31, 2024.
For the Year Ended December 31, 2024 2023 2022 (In millions) Reconciliation of cash provided by operating activities to cash provided by operating activities, as adjusted Cash provided by operating activities, as reported $ 671.2 $ 313.0 $ 696.0 Change in Floor Plan Notes Payable Non-Trade, net (5.2) 1,018.9 (191.1) Change in Floor Plan Notes Payable Non-Trade associated with floor plan offset, used vehicle borrowing base changes adjusted for acquisition and divestitures 71.9 (571.3) 462.4 Change in Floor Plan Notes Payable Trade associated with floor plan offset and acquisitions and divestitures, net (49.5) (55.3) 19.7 Adjusted cash flow provided by operating activities $ 688.4 $ 705.3 $ 987.0 Operating Activities— Net cash provided by operating activities totaled $671.2 million, $313.0 million, and $696.0 million for the years ended December 31, 2024, 2023, and 2022, respectively.
For the Year Ended December 31, 2025 2024 2023 (In millions) Reconciliation of cash provided by operating activities to cash provided by operating activities, as adjusted Cash provided by operating activities, as reported $ 775.2 $ 671.2 $ 313.0 Change in Floor Plan Notes Payable Non-Trade, net (57.2) (5.2) 1,018.9 Change in Floor Plan Notes Payable Non-Trade associated with floor plan offset, used vehicle borrowing base changes adjusted for acquisition and divestitures (9.1) 71.9 (571.3) Change in Floor Plan Notes Payable Trade associated with floor plan offset and acquisitions and divestitures, net (57.4) (49.5) (55.3) Adjusted cash flow provided by operating activities $ 651.4 $ 688.4 $ 705.3 Operating Activities— Net cash provided by operating activities totaled $775.2 million, $671.2 million, and $313.0 million for the years ended December 31, 2025, 2024, and 2023, respectively.
This increase was offset by lower gross profit per vehicle sold for both new and used as margins continue to shift downward from the historic highs in recent years. • The effects of dealership divestitures also impacted consolidated revenue and gross profit. During the year ended December 31, 2024, we divested five franchises (five dealership locations).
This increase was offset by lower gross profit per vehicle sold for new vehicles as margins continue to shift downward from the historic highs in recent years. • The effects of dealership divestitures also impacted consolidated revenue and gross profit. During the year ended December 31, 2025, we divested 24 franchises (15 dealership locations).
During the years ended December 31, 2024, 2023, and 2022, we purchased $165.0 million, $195.2 million and $202.2 million of debt securities and $41.4 million of equity securities in December 31, 2022. We did not purchase any equity securities in 2024 or 2023.
During the years ended December 31, 2025, 2024, and 2023, we purchased $189.4 million, $165.0 million and $195.2 million of debt securities. We did not purchase any equity securities in 2025, 2024 or 2023.
Same store SG&A expense as a percentage of gross profit increased 528 basis points from 58.3% in 2023 to 63.5% in 2024. The increase in SG&A as a percentage of gross profit is primarily the result of higher cost in personnel and other categories in SG&A expense partially offset by higher gross profits for 2024 as compared to 2023.
Same store SG&A expense as a percentage of gross profit increased 16 basis points from 63.5% in 2024 to 63.7% in 2025. The increase in SG&A as a percentage of gross profit is primarily the result of higher cost in personnel and other categories in SG&A expense partially offset by higher gross profits for 2025 as compared to 2024.
The F&I products offered by TCA are sold through affiliated dealerships. For the year ended December 31, 2024, our new vehicle revenue brand mix consisted of 41% imports, 30% luxury, and 29% domestic brands. The Company manages its operations in two reportable segments: Dealerships and TCA.
The F&I products offered by TCA are sold through affiliated dealerships. For the year ended December 31, 2025, our new vehicle revenue brand mix consisted of 40% imports, 32% luxury, and 28% domestic brands. The Company manages its operations in two reportable segments: Dealerships and TCA.
The Company recorded a pre-tax gain totaling $8.6 million, which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net. During the year ended December 31, 2023, we sold 1 franchise (1 dealership location) in Austin, Texas. The Company recorded a pre-tax gain totaling $13.5 million.
The Company recorded a pre-tax gain totaling $8.6 million, which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net. During the year ended December 31, 2023, we sold one franchise (one dealership location) for proceeds of $30.7 million. The Company recorded a pre-tax gain totaling $13.5 million.
Adjusted cash flow provided by operating activities totaled $688.4 million, $705.3 million, and $987.0 million for the years ended December 31, 2024, 2023, and 2022, respectively.
Adjusted cash flow provided by operating activities totaled $651.4 million, $688.4 million, and $705.3 million for the years ended December 31, 2025, 2024, and 2023, respectively.
In addition, during the years ended December 31, 2023, we had non-trade floor plan borrowings of $256.1 million, related to acquisitions.
In addition, during the years ended December 31, 2025 and 2023 we had non-trade floor plan borrowings of $262.7 million and $256.1 million, respectively, related to acquisitions.
As of December 31, 2024, we had $1.42 billion outstanding under the New Vehicle Floor Plan Facility, which includes $56.7 million classified in loaner vehicles notes payable which is included in accounts payable and accrued liabilities in our consolidated balance sheets. As of December 31, 2024, we held $115.7 million in the floor plan notes payable offset account.
As of December 31, 2025, we had $1.57 billion outstanding under the New Vehicle Floor Plan Facility, which includes $65.0 million classified in loaner vehicles notes payable which is included in accounts payable and accrued liabilities in our consolidated balance sheets. As of December 31, 2025, we held $150.7 million in the floor plan notes payable offset account.
As of December 31, 2024, we had $349.9 million, which is net of $1.0 million in our floor plan offset account, outstanding under our floor plan facility.
As of December 31, 2025, we had $343.1 million, which is net of $1.0 million in our floor plan offset account, outstanding under our floor plan facility.
During the years ended December 31, 2024, 2023, and 2022, we made non-trade floor plan repayments of $9.66 billion, $7.06 billion, and $7.89 billion, respectively. In addition, during the years ended December 31, 2024 and 2022, we had floor plan repayments associated with dealership divestitures of $34.1 million and $48.4 million, respectively.
During the years ended December 31, 2025, 2024, and 2023, we made non-trade floor plan repayments of $10.21 billion, $9.66 billion, and $7.06 billion, respectively. In addition, during the years ended December 31, 2025 and 2024, we had floor plan repayments associated with dealership divestitures of $90.7 million and $34.1 million, respectively.
On a same store basis, F&I revenue, net decreased by $30.3 million (5%) in 2024 when compared to 2023 primarily as a result of a 1% decrease in new and used retail unit sales and a $144 (6%) decrease in F&I per vehicle retailed.
On a same store basis, F&I revenue, net decreased by $17.6 million (2%) in 2025 when compared to 2024 primarily as a result of a 2% decrease in new and used retail unit sales and a $14 (1%) decrease in F&I per vehicle retailed.
Proceeds from the sale of assets, unrelated to a dealership divestiture, were $6.5 million and $16.3 million for the years ended December 31, 2024 and 2023, respectively. We did not have any proceeds from the sale of assets, unrelated to a dealership divestitures in 2022.
Proceeds from the sale of assets, unrelated to a dealership divestiture, was $6.5 million and $16.3 million for the years ended December 31, 2024 and 2023, respectively. We did not have proceeds from the sale of assets, unrelated to a dealership divestiture, for the year ended December 31, 2025.
Asset Impairments — During the year ended December 31, 2024, we recognized asset impairment charges of $149.5 million as compared to $117.2 million of impairment charges during the year ended December 31, 2023.
Asset Impairments — During the year ended December 31, 2025, we recognized asset impairment charges of $141.0 million as compared to $149.5 million of impairment charges during the year ended December 31, 2024.
The decrease in our new vehicle gross profit margin was primarily attributable to the easing of new vehicle inventory constraints which softened the historically high new vehicle margins seen in recent years.
The decrease in our new vehicle gross profit margin was primarily attributable to the softening of the historically high new vehicle margins seen in recent years.
Commissions expense paid by TCA to our affiliated dealerships and reflected as F&I revenue in our Dealerships segment is eliminated upon consolidation.
Commissions expense paid by TCA to our affiliated dealerships and reflected as F&I revenue in our Dealerships segment is eliminated in the consolidated financial statements.
The financial results of the TCA segment, after dealership eliminations, are as follows: For the Year Ended December 31, Increase (Decrease) % Change 2024 2023 (Dollars in millions) Finance and insurance, revenue $ 120.6 $ 138.3 $ (17.8) (13) % Finance and insurance, cost of sales $ 54.4 $ 37.9 $ 16.4 43 % Finance and insurance, gross profit $ 66.2 $ 100.4 $ (34.2) (34) % TCA offers a variety of F&I products, such as extended vehicle service contracts, prepaid maintenance contracts, GAP, appearance protection contracts and lease wear-and-tear contracts.
The financial results of the TCA segment, after dealership eliminations, are as follows: For the Year Ended December 31, Increase (Decrease) % Change 2025 2024 (Dollars in millions) Finance and insurance, revenue $ 91.1 $ 120.6 $ (29.5) (24) % Finance and insurance, cost of sales $ 52.5 $ 54.4 $ (1.9) (3) % Finance and insurance, gross profit $ 38.6 $ 66.2 $ (27.6) (42) % TCA offers a variety of F&I products, such as extended vehicle service contracts, prepaid maintenance contracts, GAP, appearance protection contracts and lease wear-and-tear contracts.
There were no purchases related to real estate for the year ended December 31, 2023. Purchases of real estate totaled $145.6 million and $13.3 million for the years ended December 31, 2024, and 2022, respectively. In addition, we purchased previously leased facilities for $11.9 million during the year ended December 31, 2024.
Purchases of real estate totaled $19.3 million and $145.6 million for the years ended December 31, 2025, and 2024, respectively. In addition, we purchased previously leased facilities for $11.9 million during the year ended December 31, 2024.
As of December 31, 2024 we had total mortgage notes payable outstanding of $29.6 million which are collateralized by the associated real estate. • 2021 Real Estate Facility —On December 17, 2021, we entered into a real estate term loan credit agreement with Bank of America, N.A., as administrative agent and the other lenders party thereto, which provided for term loans in an aggregate amount equal to $689.7 million (the "2021 Real Estate Facility").
As of December 31, 2025, we had $537.4 million of outstanding borrowings under the 2025 Real Estate Facility. • 2021 Real Estate Facility —On December 17, 2021, we entered into a real estate term loan credit agreement with Bank of America, N.A., as administrative agent and the other lenders party thereto, which provided for term loans in an aggregate amount equal to $689.7 million (the "2021 Real Estate Facility").
As of December 31, 2024, through our Dealerships segment, we owned and operated 198 new vehicle franchises (152 dealership locations), representing 31 brands of automobiles, within 14 states. We also operated 37 collision centers, and Total Care Auto, Powered by Landcar ("TCA"), our F&I product provider.
As of December 31, 2025, through our Dealerships segment, we owned and operated 223 new vehicle franchises (171 dealership locations), representing 36 brands of automobiles, within 15 states. We also operated 39 collision centers, and Total Care Auto, Powered by Asbury ("TCA"), our F&I product provider.
As of December 31, 2024, we had $158.6 million of outstanding borrowings under the 2021 BofA Real Estate Facility. There is no further borrowing availability under the 2021 BofA Real Estate Credit Agreement.
As of December 31, 2025, we had $151.2 million of outstanding borrowings under the 51 Table of Contents 2021 BofA Real Estate Facility. There is no further borrowing availability under the 2021 BofA Real Estate Credit Agreement.
These divested dealerships contributed $121.2 million of revenue during the year ended December 31, 2024. • Our capital allocation priorities were supported by share repurchases of approximately 830,297 million shares for $183.0 million during the year ended December 31, 2024. 39 Table of Contents CONSOLIDATED RESULTS OF OPERATIONS We assess the organic growth of our revenue and gross profit on a same store basis.
These divested dealerships contributed approximately $436.3 million of revenue during the year ended December 31, 2025. • Our capital allocation priorities were supported by share repurchases of approximately 432,752 shares for $99.9 million during the year ended December 31, 2025. 40 Table of Contents CONSOLIDATED RESULTS OF OPERATIONS We assess the organic growth of our revenue and gross profit on a same store basis.
As of December 31, 2024, we had $579.9 million of outstanding borrowings under the 2021 Real Estate Facility.
As of December 31, 2025, we had $442.1 million of outstanding borrowings under the 2021 Real Estate Facility.
See Note 14 "Debt" for further details. • 2013 BofA Real Estate Facility —On September 26, 2013, we entered into a real estate term loan credit agreement (the "2013 BofA Real Estate Credit Agreement") with Bank of America, N.A., as lender, providing for term loans in an aggregate amount not to exceed $75.0 million, subject to customary terms and conditions (the "2013 BofA Real Estate Facility").
The outstanding balance under this agreement in the amount of $31.6 million was paid off in May 2025. • 2013 BofA Real Estate Facility —On September 26, 2013, we entered into a real estate term loan credit agreement (the "2013 BofA Real Estate Credit Agreement") with Bank of America, N.A., as lender, providing for term loans in an aggregate amount not to exceed $75.0 million, subject to customary terms and conditions (the "2013 BofA Real Estate Facility").
During the years ended December 31, 2024, 2023, and 2022, we also received proceeds of $149.8 million, $60.3 million, and $69.7 million from the sale of debt securities respectively and $51.8 million and $50.3 million, from the sale of equity securities in 2023, and 2022, respectively.
During the years ended December 31, 2025, 2024, and 2023, we also received proceeds of $132.8 million, $149.8 million, and $60.3 million from the sale of debt securities respectively and $51.8 million from the sale of equity securities in 2023. We did not have any proceeds from the sale of equity securities in 2025 or 2024.
The increase in same store parts and service revenue was due to a $42.7 million (4%) increase in customer pay revenue and a $33.0 million (12%) increase in warranty revenue, partially offset by a $15.6 million (4%) decrease in wholesale parts revenue and a $24.2 million (9%) decrease in collision revenue.
The increase in same store parts and service revenue was due to a $52.0 million (4%) increase in customer pay revenue and a $38.2 million (12%) increase in warranty revenue, partially offset by a $13.8 million (5%) decrease in collision revenue and a $2.7 million (1%) decrease in wholesale parts revenue.
During the years ended December 31, 2024, 2023, and 2022, we had non-trade floor plan borrowings of $9.45 billion, $8.39 billion, and $7.41 billion, respectively. Included in our non-trade floor plan borrowings, were borrowings of $100.7 million and $307.1 million for the years ended December 31, 2024 and 2023, respectively, related to our used vehicle floor plan facility.
Included in our non-trade floor plan borrowings, were borrowings of $325.0 million, $100.7 million, and $307.1 million for the years ended December 31, 2025, 2024, and 2023, respectively, related to our used vehicle floor plan facility.
We also recorded a goodwill impairment charge of $1.3 million during the year ended December 31, 2024 related to one dealership that met the assets held for sale criteria in June 2024. The quantitative impairment test of the disposal group included a comparison of the estimated fair value to the carrying value of the disposal group less cost to sell.
We also recorded a franchise rights impairment charge of $26.0 million during the year ended December 31, 2025 related to dealerships that met the assets held for sale criteria during 2025. The quantitative impairment test of the disposal group included a comparison of the estimated fair value, less costs to sell, to the carrying value of the disposal group.
As a result, when used vehicle, parts and service, and F&I revenue increase as a percentage of total revenue, we expect our overall gross profit margin to increase.
Historically, the sales of new vehicles generally results in a lower gross profit margin than used vehicle sales, sales of parts and service, and sales of F&I products. As a result, when used vehicle, parts and service, and F&I revenue increase as a percentage of total revenue, we expect our overall gross profit margin to increase.
The $7.3 million increase in parts and service revenue was due to a $6.3 million increase in customer pay revenue and a $10.2 million (4%) increase in warranty revenue, partially offset by a $9.2 million (2%) decrease in wholesale parts revenue.
The $152.1 million (6%) increase in parts and service revenue was due to a $95.8 million (8%) increase in customer pay revenue, a $66.4 million (19%) increase in warranty revenue, partially offset by a $4.9 million (1%) decrease in wholesale parts revenue and a $5.1 million (2%) decrease in collision revenue.
We continue to monitor developments related to macroeconomic conditions and the performance of our stores and reporting units. It is reasonably possible that future developments could have a negative effect on the estimates and assumptions utilized in our impairment assessments and could result in material impairment charges in future periods.
It is reasonably possible that future developments could have a negative effect on the estimates and assumptions utilized in our impairment assessments and could result in material impairment charges in future periods.
The $55.4 million increase in same store gross profit, excluding reconditioning and preparation, is primarily due to a $44.5 million (8%) increase in customer pay gross profit and a $21.3 million (15%) increase in warranty gross profit, partially offset by an $8.1 million (7%) decrease in collision gross profit and a $2.3 million (3%) decrease in wholesale parts gross profit.
The $57.2 million increase in same store gross profit, excluding reconditioning and preparation, is primarily due to a $41.0 million (6%) increase in customer pay gross profit and a $21.7 million (12%) increase in warranty gross profit, partially offset by a $5.8 million (5%) decrease in collision gross profit.
See Note 14 "Debt" for further details. • 2018 Wells Fargo Master Loan Facility — On November 16, 2018, certain of our subsidiaries entered into a master loan agreement (the "2018 Wells Fargo Master Loan Agreement") with Wells Fargo as lender, which provides for term loans to certain of our subsidiaries that are borrowers under the 2018 Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $100.0 million (the "2018 Wells Fargo Master Loan Facility").
In November 2025, we paid off the aggregate principal amounts remaining under the 2018 BofA Real Estate Facility for an aggregate amount of approximately $34.2 million. • 2018 Wells Fargo Master Loan Facility — On November 16, 2018, certain of our subsidiaries entered into a master loan agreement (the "2018 Wells Fargo Master Loan Agreement") with Wells Fargo as lender, which provides for term loans to certain of our subsidiaries that are borrowers under the 2018 Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $100.0 million (the "2018 Wells Fargo Master Loan Facility").
Our total gross profit margin decreased 146 basis points from 18.6% in 2023 to 17.2% in 2024.
Our total gross profit margin decreased 9 basis points from 17.2% in 2024 to 17.1% in 2025.
Other Interest Expense — Other interest expense increased $23.0 million (15%) from $156.1 million in 2023 to $179.1 million in 2024. The increase is primarily due to higher loaner payable interest expense driven by higher loaner vehicle balances, as well as interest expense on our revolving credit agreement during the year ended December 31, 2024.
The increase is primarily due to higher loaner payable interest expense driven by higher loaner vehicle balances, as well as interest expense on our revolving credit agreement during the year ended December 31, 2025.
The increase in our effective tax rate was primarily due to lower income before taxes and our acquisition and divestiture activity. Stores acquired are located in relatively high tax rate states while the stores divested are located in relatively low or no tax rate states.
Our effective tax rate increased 50 basis points from 25.2% in 2024 to 25.7% in 2025. The increase in our effective tax rate was primarily due to our acquisition and divestiture activity. Stores acquired are located in relatively high tax rate states while the stores divested are located in relatively low or no tax rate states.
The decrease in our adjusted cash flow provided by operating activities, was partially offset by: • $155.2 million related to an increase in inventory, net of floor plan notes payable, including both trade and non-trade, excluding offset and including used vehicle borrowing base changes adjusted for acquisitions and divestitures; and • $114.4 million related to the change in accounts payable and accrued liabilities.
The decrease in our adjusted cash flow provided by operating activities was partially offset by: • $59.4 million increase related to sale volume and the timing of collection of accounts receivable and contracts-in-transit during 2025 compared to 2024; • $31.3 million increase related to other long-term assets and liabilities, net; and • increase of $8.2 million in inventory, net of floor plan notes payable, including both trade and non-trade, excluding offset and including used vehicle borrowing base changes adjusted for acquisitions and divestitures.
During the year ended December 31, 2024, we had additional borrowings of $376.4 million and $582.8 million 57 Table of Contents in repayments resulting in $100.7 million outstanding borrowings as of December 31, 2024. We had $186.1 million borrowing capacity under the Used Vehicle Floor Plan Facility based on our borrowing base calculation as of December 31, 2024.
During the year ended December 31, 2025, we had additional borrowings of $650.0 million and $425.7 million in repayments resulting in $325.0 million outstanding borrowings as of December 31, 2025. We had fully utilized our borrowing capacity under the Used Vehicle Floor Plan Facility based on our borrowing base calculation as of December 31, 2025.
The Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 For the Year Ended December 31, Increase (Decrease) % Change 2024 2023 (Dollars in millions, except per share data) REVENUE: New vehicle $ 8,849.7 $ 7,630.7 $ 1,219.0 16 % Used vehicle 5,218.2 4,414.3 803.9 18 % Parts and service 2,354.7 2,081.5 273.2 13 % Finance and insurance, net 766.0 676.2 89.8 13 % TOTAL REVENUE 17,188.6 14,802.7 2,385.9 16 % GROSS PROFIT: New vehicle 640.4 703.0 (62.6) (9) % Used vehicle 245.4 264.0 (18.6) (7) % Parts and service 1,351.2 1,150.6 200.6 17 % Finance and insurance, net 711.6 638.2 73.4 11 % TOTAL GROSS PROFIT 2,948.6 2,755.8 192.8 7 % OPERATING EXPENSES: Selling, general and administrative 1,888.5 1,617.4 271.2 17 % Depreciation and amortization 75.0 67.7 7.3 11 % Asset impairments 149.5 117.2 32.3 28 % INCOME FROM OPERATIONS 835.6 953.5 (117.9) (12) % OTHER (INCOME) EXPENSES: Floor plan interest expense 89.9 9.6 80.2 NM Other interest expense, net 179.1 156.1 23.0 15 % Gain on dealership divestitures, net (8.6) (13.5) 4.9 (36) % Total other expenses, net 260.3 152.2 108.1 71 % INCOME BEFORE INCOME TAXES 575.3 801.3 (226.0) (28) % Income tax expense 145.0 198.8 (53.8) (27) % NET INCOME $ 430.3 $ 602.5 $ (172.2) (29) % Net income per common share—Diluted $ 21.50 $ 28.74 $ (7.24) (25) % ______________________________ NM — Not Meaningful 40 Table of Contents For the Year Ended December 31, 2024 2023 REVENUE MIX PERCENTAGES: New vehicles 51.5 % 51.5 % Used retail vehicles 26.8 % 27.1 % Used vehicle wholesale 3.6 % 2.7 % Parts and service 13.7 % 14.1 % Finance and insurance, net 4.5 % 4.6 % Total revenue 100.0 % 100.0 % GROSS PROFIT MIX PERCENTAGES: New vehicles 21.7 % 25.5 % Used retail vehicles 7.8 % 9.0 % Used vehicle wholesale 0.6 % 0.6 % Parts and service 45.8 % 41.8 % Finance and insurance, net 24.1 % 23.2 % Total gross profit 100.0 % 100.0 % GROSS PROFIT MARGIN 17.2 % 18.6 % SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT 64.0 % 58.7 % Total revenue during 2024 increased by $2,385.9 million (16%) compared to 2023, due to a $1,219.0 million (16%) increase in new vehicle revenue, an $803.9 million (18%) increase in used vehicle revenue, a $273.2 million (13%) increase in parts and service revenue and an $89.8 million (13%) increase in F&I revenue.
The Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 For the Year Ended December 31, Increase (Decrease) % Change 2025 2024 (Dollars in millions, except per share data) REVENUE: New vehicle $ 9,496.2 $ 8,849.7 $ 646.5 7 % Used vehicle 5,225.4 5,218.2 7.2 NM Parts and service 2,506.8 2,354.7 152.1 6 % Finance and insurance, net 770.6 766.0 4.6 1 % TOTAL REVENUE 17,999.0 17,188.6 810.4 5 % GROSS PROFIT: New vehicle 621.9 640.4 (18.4) (3) % Used vehicle 259.1 245.4 13.6 6 % Parts and service 1,472.5 1,351.2 121.3 9 % Finance and insurance, net 718.1 711.6 6.5 1 % TOTAL GROSS PROFIT 3,071.7 2,948.6 123.0 4 % OPERATING EXPENSES: Selling, general and administrative 1,987.6 1,888.5 99.0 5 % Depreciation and amortization 82.4 75.0 7.4 10 % Asset impairments 141.0 149.5 (8.5) (6) % INCOME FROM OPERATIONS 860.6 835.6 25.0 3 % OTHER (INCOME) EXPENSES: Floor plan interest expense 91.2 89.9 1.3 1 % Other interest expense, net 187.5 179.1 8.3 5 % Gain on dealership divestitures, net (80.2) (8.6) (71.6) NM Total other expenses, net 198.4 260.3 (61.9) (24) % INCOME BEFORE INCOME TAXES 662.2 575.3 86.9 15 % Income tax expense 170.2 145.0 25.3 17 % NET INCOME $ 492.0 $ 430.3 $ 61.6 14 % Net income per common share—Diluted $ 25.13 $ 21.50 $ 3.63 17 % ______________________________ NM — Not Meaningful 41 Table of Contents For the Year Ended December 31, 2025 2024 REVENUE MIX PERCENTAGES: New vehicles 52.8 % 51.5 % Used retail vehicles 25.3 % 26.8 % Used vehicle wholesale 3.8 % 3.6 % Parts and service 13.9 % 13.7 % Finance and insurance, net 4.3 % 4.5 % Total revenue 100.0 % 100.0 % GROSS PROFIT MIX PERCENTAGES: New vehicles 20.2 % 21.7 % Used retail vehicles 7.8 % 7.8 % Used vehicle wholesale 0.6 % 0.6 % Parts and service 47.9 % 45.8 % Finance and insurance, net 23.4 % 24.1 % Total gross profit 100.0 % 100.0 % GROSS PROFIT MARGIN 17.1 % 17.2 % SG&A EXPENSES AS A PERCENTAGE OF GROSS PROFIT 64.7 % 64.0 % Total revenue during 2025 increased by $810.4 million (5%) compared to 2024, due to a $646.5 million (7%) increase in new vehicle revenue, a $152.1 million (6%) increase in parts and service revenue, a $7.2 million increase in used vehicle revenue and a $4.6 million (1%) increase in F&I revenue.
Finance and Insurance, net— For the Year Ended December 31, Increase (Decrease) % Change 2024 2023 (Dollars in millions, except for per vehicle data) As Reported: Finance and insurance, net revenue $ 766.0 $ 676.2 $ 89.8 13 % Finance and insurance, net gross profit $ 711.6 $ 638.2 $ 73.4 11 % Finance and insurance, net per vehicle sold $ 2,197 $ 2,304 $ (107) (5) % Same Store: Finance and insurance, net revenue $ 630.4 $ 660.7 $ (30.3) (5) % Finance and insurance, net gross profit $ 576.0 $ 622.8 $ (46.8) (8) % Finance and insurance, net per vehicle sold $ 2,181 $ 2,325 $ (144) (6) % F&I revenue, net increased by $89.8 million (13%) in 2024 when compared to 2023 primarily as a result of a 17% increase in new and used retail unit sales, partially offset by a $107 (5%) decrease in F&I per vehicle retailed.
Finance and Insurance, net— For the Year Ended December 31, Increase (Decrease) % Change 2025 2024 (Dollars in millions, except for per vehicle data) As Reported: Finance and insurance, net revenue $ 770.6 $ 766.0 $ 4.6 1 % Finance and insurance, net gross profit $ 718.1 $ 711.6 $ 6.5 1 % Finance and insurance, net per vehicle sold $ 2,214 $ 2,197 $ 17.0 1 % Same Store: Finance and insurance, net revenue $ 715.7 $ 733.3 $ (17.6) (2) % Finance and insurance, net gross profit $ 663.2 $ 678.9 $ (15.7) (2) % Finance and insurance, net per vehicle sold $ 2,224 $ 2,238 $ (14.0) (1) % F&I revenue, net increased by $4.6 million (1%) in 2025 when compared to 2024 primarily as a result of a $17 (1%) increase in F&I per vehicle retailed which was partially offset by a decline in new and used retail unit sales.
The $192.8 million (7%) increase in gross profit during 2024 was the result of a $200.6 million (17%) increase in parts and service gross profit and a $73.4 million (11%) increase in F&I gross profit, partially offset by a $62.6 million (9%) decrease in new vehicle gross profit and an $18.6 million (7%) decrease in used vehicle gross profit.
The $123.0 million (4%) increase in gross profit during 2025 was the result of a $121.3 million (9%) increase in parts and service gross profit, a $13.6 million (6%) increase in used vehicle gross profit and a $6.5 million (1%) increase in F&I gross profit, partially offset by an $18.4 million (3%) decrease in new vehicle gross profit.
We believe that our used vehicle inventory continues to be well-aligned with current consumer demand, with approximately 32 days of supply as of December 31, 2023. This level of days of supply is in line with our historic targeted range of 30 to 35 days.
We believe that our used vehicle inventory continues to be well-aligned with current consumer demand, with approximately 38 days of supply as of December 31, 2025.
During 2023, we did not have any floor plan repayments associated with dealership divestitures. Repayments of borrowings totaled $71.4 million, $126.0 million and $106.2 million, for the years ended December 31, 2024, 2023, and 2022, respectively. During the year ended December 31, 2022, we received net proceeds from the issuance of common stock totaling $1.4 million.
During 2023, we did not have any floor plan repayments associated with dealership divestitures. Proceeds from borrowings totaled $546.5 million for the year ended December 31, 2025. We did not have proceeds from borrowings for the years ended December 31, 2024 and 2023, respectively.
Commissions expense paid by TCA to our affiliated dealerships and reflected as F&I revenue in our Dealerships segment is eliminated in the consolidated financial statements. 37 Table of Contents Our continued organic growth is dependent upon the execution of our balanced automotive retailing and service business strategy, the continued strength of our brand mix, and the production and allocation of desirable vehicles from the automobile manufacturers whose brands we sell.
Our continued organic growth is dependent upon the execution of our balanced automotive retailing and service business strategy, the continued strength of our brand mix, and the production and allocation of desirable vehicles from the automobile 38 Table of Contents manufacturers whose brands we sell.
LIQUIDITY AND CAPITAL RESOURCES As of December 31, 2024, we had total available liquidity of $827.7 million , which consisted of cash and cash equivalents of $38.9 million (excluding $30.5 million held by TCA), available funds in our floor plan offset accounts of $116.7 million million and $486.0 million of availability under our revolving credit facility and $186.1 million of availability under our used vehicle floor plan facility.
LIQUIDITY AND CAPITAL RESOURCES As of December 31, 2025, we had total available liquidity of $927.1 million, which consisted of cash and cash equivalents of $28.2 million (excluding $12.2 million held by TCA), available funds in our floor plan offset accounts of $151.6 million and $747.3 million of availability under our revolving credit facility.
As of December 31, 2024, we had $14.0 million in outstanding letters of credit, resulting in $486.0 million of borrowing availability. We began the year wit h no am ounts drawn on our revolving credit facility.
As of December 31, 2025, we had $25.2 million in outstanding letters of credit, resulting in $747.3 million of borrowing availability. We began the year with no amounts drawn on our revolving credit facility.
I n addition to the payment of interest on borrowings outstanding under the 2023 Senior Credit Facility, we are required to pay a quarterly commitment fee on total unused commitments thereunder.
In addition, we are able to re-designate any amounts moved to the New Vehicle Floor Plan Facility or the Used Vehicle Floor Plan Facility back to the Revolving Credit Facility. In addition to the payment of interest on borrowings outstanding under the 2023 Senior Credit Facility, we are required to pay a quarterly commitment fee on total unused commitments thereunder.
During the year ended December 31, 2024, 2023, 2022 we repurchased 830,297, 1,316,167 and 1,635,030 shares of our common stock under our Repurchase Program for a total of 183.0 million and $258.1 million and $297.0 million and 46,941, 48,262 and 56,024 shares of our common stock for $10.2 million, $11.4 million and $9.2 million from employees in connection with a net share settlement feature of employee equity-based awards, respectively.
During the years ended December 31, 2025, 2024, and 2023 we repurchased 432,752, 830,297, and 1,316,167 shares of our common stock under our Repurchase Program for a total of $99.9 million, $183.0 million and $258.1 million and 44,212, 46,941 and 48,262 shares of our common stock for $12.8 million, $10.2 million and $11.4 million from employees in connection with a net share settlement feature of employee equity-based awards, respectively. 56 Table of Contents Off-Balance Sheet Arrangements We had no off-balance sheet arrangements during any of the periods presented other than those disclosed in Note 21 "Commitments and Contingencies" of the Company's consolidated financial statements.
Parts and service gross profit, excluding reconditioning and preparation, increased by $5.1 million (1%) to $936.6 million and same store gross profit, excluding reconditioning and preparation, increased by $47.6 million (5%) to $928.1 million.
Parts and service gross profit, excluding reconditioning and preparation, increased by $107.9 million (10%) to $1,211.9 million and same store gross profit, excluding reconditioning and preparation, increased by $57.2 million (5%) to $1,100.1 million.
Amounts presented have been calculated using non-rounded amounts for all periods presented and therefore certain amounts may not compute due to rounding. Our dealerships gross profit margin varies with our revenue mix. Historically, the sales of new vehicles generally results in a lower gross profit margin than used vehicle sales, sales of parts and service, and sales of F&I products.
Amounts presented have been calculated using non-rounded amounts for all periods presented and therefore certain amounts may not compute due to rounding. Our Dealerships segment gross profit margin varies with our revenue mix.
We did not have any proceeds from the sale of equity securities in 2024. 63 Table of Contents Financing Activities— Net cash used in financing activities totaled $510.3 million and $1.10 billion for the years ended December 31, 2024 and 2022, respectively. Net cash provided by financing activities totaled $1.18 billion for the year ended December 31, 2023.
Financing Activities— Net cash provided by financing activities totaled $653.1 million and $1.18 billion for the years ended December 31, 2025 and 2023, respectively. Net cash used in financing activities totaled $510.3 million for the year ended December 31, 2024.
Refer to the "Forward-Looking Statements" and Part I, Item 1A. Risk Factors for a discussion of these risks and uncertainties. The discussion of our financial condition and results of operations for the year ended December 31, 2022 is included in Item 7.
Refer to the "Forward-Looking Statements" and Part I, Item 1A. Risk Factors for a discussion of these risks and uncertainties.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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For additional information about the effect of our derivative instruments, please refer to Note 15 "Financial Instruments and Fair Value" within the accompanying consolidated financial statements. 67 Table of Contents
For additional information about the effect of our derivative instruments, please refer to Note 15 "Financial Instruments and Fair Value" within the accompanying consolidated financial statements. 59 Table of Contents
All of our interest rate swaps qualify for cash flow hedge accounting treatment and do not contain any ineffectiveness. As of December 31, 2024 we had six interest rate swap agreements. These swaps are designed to provide a hedge against changes in variable rate cash flows regarding fluctuations in SOFR.
All of our interest rate swaps qualify for cash flow hedge accounting treatment and do not contain any ineffectiveness. As of December 31, 2025 we had four interest rate swap agreements. These swaps are designed to provide a hedge against changes in variable rate cash flows regarding fluctuations in SOFR.
We periodically receive floor plan assistance from certain automobile manufacturers, which is primarily accounted for as a reduction in our new vehicle inventory cost. Floor plan assistance reduced our cost of sales for the years ended December 31, 2024, 2023, and 2022, by $99.7 million, $87.0 million and $85.8 million, respectively.
We periodically receive floor plan assistance from certain automobile manufacturers, which is primarily accounted for as a reduction in our new vehicle inventory cost. Floor plan assistance reduced our cost of sales for the years ended December 31, 58 Table of Contents 2025, 2024, and 2023, by $113.4 million, $99.7 million and $87.0 million, respectively.
Based on $1.67 billion of total variable interest rate debt, which includes our floor plan notes payable, amounts drawn on our used vehicle floor plan, revolver and certain mortgage liabilities, outstanding as of December 31, 2024, a 100 basis point change in interest rates would result in a change of $16.7 million in annual interest expense.
Based on $2.62 billion of total variable interest rate debt, which includes our floor plan notes payable, amounts drawn on our used vehicle floor plan, revolver and certain mortgage liabilities, outstanding as of December 31, 2025, a 100 basis point change in interest rates would result in a change of $26.2 million in annual interest expense.
The following table provides information on the attributes of each swap as of December 31, 2024: 66 Table of Contents Inception Date Notional Value at Inception Notional Value Notional Value at Maturity Maturity Date (In millions) (In millions) (In millions) January 2022 $ 300.0 $ 258.8 $ 228.8 December 2026 January 2022 $ 250.0 $ 250.0 $ 250.0 December 2031 May 2021 $ 184.4 $ 158.6 $ 110.6 May 2031 July 2020 $ 93.5 $ 71.0 $ 50.6 December 2028 July 2020 $ 85.5 $ 62.7 $ 57.3 November 2025 June 2015 $ 100.0 $ 53.5 $ 53.1 February 2025 These interest rate swaps are marked to market at each reporting date and any unrealized gains or losses are included in accumulated other comprehensive income and reclassified to other interest expense in the same period or periods during which the hedged transactions affect earnings.
The following table provides information on the attributes of each swap as of December 31, 2025: Inception Date Notional Principal at Inception Notional Value as of December 31, 2025 Notional Principal at Maturity Maturity Date (In millions) January 2022 $ 300.0 $ 243.8 $ 228.8 December 2026 January 2022 $ 250.0 $ 250.0 $ 250.0 December 2031 May 2021 $ 184.4 $ 151.2 $ 110.6 May 2031 July 2020 $ 93.5 $ 65.8 $ 50.6 December 2028 These interest rate swaps are marked to market at each reporting date and any unrealized gains or losses are included in accumulated other comprehensive income and reclassified to other interest expense in the same period or periods during which the hedged transactions affect earnings.
Removed
All interest rate swap agreements with an inception date of 2021 and prior were amended on June 1, 2022 to provide a hedge against changes in variable rate cash flows regarding fluctuations in SOFR as compared to the previous benchmark rate of one-month LIBOR. The revisions to the interest rate swap agreements did not impact our hedge accounting.

Other ABG 10-K year-over-year comparisons