DRVN Driven Brands Holdings Inc

--Achieved 13 consecutive quarters of same store sales growth--

--Maintenance segment delivered 5% same store sales growth driven by 7% in Take 5 Oil Change--

--Net Income of $4 million and Adjusted EBITDA of $131 million--

--Announces CFO transition--

--Reaffirms Fiscal Year 2024 Outlook--

Driven Brands Holdings Inc. (NASDAQ: DRVN) (“Driven Brands” or the “Company”) today reported financial results for the first quarter ending March 30, 2024.

For the first quarter, Driven Brands delivered revenue of $572 million, up 2% versus the prior year. System-wide sales were $1.6 billion, up 7% versus the prior year primarily driven by 0.7% same store sales growth and 144 net new units.

Net Income was $4.3 million or $0.03 per diluted share versus $29.7 million or $0.17 per diluted share in the prior year. Adjusted Net Income1 was $38.1 million or $0.23 per diluted share versus $39.1 million or $0.23 per diluted share in the prior year. Adjusted EBITDA1 was $131.0 million up 6% versus the prior year. Cash provided by operating activities increased $23.5 million or 64% to $60.3 million compared to $36.8 million in the prior year.

“We are pleased with our strong performance in the first quarter of 2024. The Maintenance segment once again delivered exceptional results, largely driven by Take 5 Oil Change, which saw same store sales growth of 7%. We increased total company revenue, managed expenses and achieved our 13th consecutive quarter of same store sales growth,” said Jonathan Fitzpatrick, President and Chief Executive Officer.

“Looking ahead to the remainder of 2024, we are confident in our full-year outlook and committed to prudently deploying capital and paying down debt,” Fitzpatrick concluded.

First Quarter 2024 Key Performance Indicators by Segment

 

System-wide Sales (in millions)

Store Count

Same-Store Sales

Revenue

(in millions)

Segment Adjusted EBITDA (in millions)

Maintenance

$

499.7

1,814

4.8

%

$

261.7

$

91.4

Car Wash

 

143.3

1,106

(7.4

)%

 

144.7

 

29.1

Paint, Collision & Glass

 

882.1

1,883

1.3

%

 

106.4

 

30.8

Platform Services

 

78.0

205

N/A

 

 

53.8

 

19.9

Corporate / Other

 

N/A

N/A

N/A

 

 

5.6

 

Total

$

1,603.1

5,008

0.7

%

$

572.2

Capital and Liquidity

The Company ended the first quarter with total liquidity of $308.0 million consisting of $165.5 million in cash and cash equivalents and $142.5 million of undrawn capacity on its variable funding securitization senior notes and revolving credit facility. This does not include the additional $135.0 million Series 2022 Class A-1 Notes that expand the Company’s variable funding note borrowing capacity when the Company elects to exercise them, assuming certain conditions continue to be met.

CFO Transition

Driven Brands also announced today that Gary W. Ferrera, Chief Financial Officer, will step down to pursue a professional opportunity at a privately held company and move back to Colorado, where his family is located.

Mr. Ferrera’s resignation will be effective after the filing of the Company’s quarterly report on Form 10-Q for the first quarter of 2024. Driven Brands has initiated a comprehensive search with the assistance of a leading executive recruitment firm to identify Mr. Ferrera’s successor.

Effective upon Mr. Ferrera’s departure, Joel Arnao, Senior Vice President of FP&A, Treasury and Investor Relations, has been appointed as interim Chief Financial Officer, and Michael Beland, Senior Vice President and Chief Accounting Officer, has been designated as principal financial officer. Mr. Ferrera will be available to support transitional needs following his departure.

Mr. Fitzpatrick added, “We appreciate Gary’s contributions to Driven Brands, which have been additive to our collective efforts to position the business for long-term value creation. The Driven Brands board and management team extend our sincere thanks to Gary and wish him well in his next chapter. Driven Brands is fortunate to have a strong bench of talent, and we appreciate that Joel and Michael have agreed to take on additional responsibilities while we undertake our CFO search. Joel and Michael are prominent members of our financial team and have a deep understanding of our business, strategy and operations. I am confident this will be a seamless transition for our stakeholders.”

Mr. Ferrera’s resignation does not reflect any disagreement with the Company on any matter relating to the Company’s operations, policies or practices, or any issues regarding the Company’s accounting policies or practices.

Fiscal Year 2024 Outlook

The Company reaffirms its financial outlook for fiscal year 2024:

 

2024 Outlook

Revenue

~$2.35 - $2.45 billion

Adjusted EBITDA1

~$535 - $565 million

Adjusted EPS1

~$0.88 - $1.00

Note: The Company has not included potential future M&A in its outlook for fiscal year 2024.

___________

1 Adjusted EBITDA, Adjusted Net Income and Adjusted EPS are non-GAAP financial measures. See “Reconciliation of Non-GAAP Financial Measures” for additional information on non-GAAP financial measures and a reconciliation to the most comparable GAAP measures. Forward-looking estimates of Adjusted EBITDA and Adjusted EPS are made in a manner consistent with the relevant definitions and assumptions noted herein.

Conference Call

Driven Brands will host a conference call to discuss first quarter 2024 results today, Thursday, May 2, 2024, at 8:30 a.m. ET. The call will be available by webcast and can be accessed by visiting Driven Brands’ Investor Relations website at investors.drivenbrands.com. A replay of the call will be available for at least three months.

About Driven Brands

Driven Brands™, headquartered in Charlotte, NC, is the largest automotive services company in North America, providing a range of consumer and commercial automotive needs, including paint, collision, glass, vehicle repair, oil change, maintenance and car wash. Driven Brands is the parent company of some of North America’s leading automotive service businesses including Take 5 Oil Change®, Take 5 Car Wash®, Meineke Car Care Centers®, Maaco®, 1-800-Radiator & A/C®, Auto Glass Now®, and CARSTAR®. Driven Brands has more than 5,000 locations across 13 countries, and services approximately 70 million vehicles annually. Driven Brands’ network generates approximately $2.3 billion in annual revenue from approximately $6.4 billion in system-wide sales.

Disclosure Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are generally identified by the use of forward-looking terminology, including the terms “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this Press Release, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, trends, plans, objectives of management, impact of accounting standards and outlook, impairments, and expected market growth are forward-looking statements. In particular, forward-looking statements include, among other things, statements relating to: (i) our strategy, outlook and growth prospects; (ii) our operational and financial targets and dividend policy; (iii) general economic trends and trends in the industry and markets; (iv) the risks and costs associated with the integration of, and our ability to integrate, our stores and business units successfully; (v) the proper application of generally accepted accounting principles, which are highly complex and involve many subjective assumptions, estimates, and judgments and (vi) the competitive environment in which we operate. Forward-looking statements are not based on historical facts, but instead represent our current expectations and assumptions regarding our business, the economy and other future conditions, and involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. It is not possible to predict or identify all such risks. These risks include, but are not limited to, the risk factors that are described under the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 30, 2023 as well as in our other filings with the Securities and Exchange Commission, which are available on its website at www.sec.gov. Given these uncertainties, you should not place undue reliance on these forward-looking statements.

DRIVEN BRANDS HOLDINGS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

 

 

Three Months Ended

(in thousands, except per share amounts)

March 30, 2024

 

April 1, 2023

Revenue:

 

 

 

Franchise royalties and fees

$

45,045

 

$

43,515

 

Company-operated store sales

 

374,456

 

 

376,066

 

Independently-operated store sales

 

53,047

 

 

52,532

 

Advertising contributions

 

24,070

 

 

21,677

 

Supply and other revenue

 

75,608

 

 

68,677

 

Total net revenue

 

572,226

 

 

562,467

 

Operating Expenses:

 

 

 

Company-operated store expenses

 

242,053

 

 

243,409

 

Independently-operated store expenses

 

29,355

 

 

29,364

 

Advertising expenses

 

24,070

 

 

21,677

 

Supply and other expenses

 

36,216

 

 

37,266

 

Selling, general, and administrative expenses

 

116,402

 

 

112,328

 

Acquisition related costs

 

1,794

 

 

1,847

 

Store opening costs

 

1,263

 

 

1,025

 

Depreciation and amortization

 

43,229

 

 

38,198

 

Asset impairment charges and lease terminations

 

19,326

 

 

167

 

Total operating expenses

 

513,708

 

 

485,281

 

Operating income

 

58,518

 

 

77,186

 

Other expenses, net:

 

 

 

Interest expense, net

 

43,772

 

 

38,141

 

Loss (gain) on foreign currency transactions

 

4,321

 

 

(1,675

)

Other expense, net

 

48,093

 

 

36,466

 

Income before taxes

 

10,425

 

 

40,720

 

Income tax expense

 

6,164

 

 

10,971

 

Net income

 

4,261

 

 

29,749

 

Net income attributable to non-controlling interest

 

—

 

 

—

 

Net income attributable to Driven Brands Holdings Inc.

$

4,261

 

$

29,749

 

 

 

 

 

Earnings per share:

 

 

 

Basic

$

0.03

 

$

0.18

 

Diluted

$

0.03

 

$

0.17

 

Weighted average shares outstanding

 

 

 

Basic

 

159,631

 

 

162,784

 

Diluted

 

160,604

 

 

166,874

 

DRIVEN BRANDS HOLDINGS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

 

(in thousands, except share and per share amounts)

March 30, 2024

 

December 30, 2023

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

165,513

 

 

$

176,522

 

Restricted cash

 

657

 

 

 

657

 

Accounts and notes receivable, net

 

165,992

 

 

 

151,259

 

Inventory

 

82,875

 

 

 

83,171

 

Prepaid and other assets

 

49,901

 

 

 

46,714

 

Income tax receivable

 

7,337

 

 

 

15,928

 

Assets held for sale

 

290,818

 

 

 

301,229

 

Advertising fund assets, restricted

 

52,711

 

 

 

45,627

 

Total current assets

 

815,804

 

 

 

821,107

 

Other assets

 

90,175

 

 

 

56,565

 

Property and equipment, net

 

1,425,882

 

 

 

1,438,496

 

Operating lease right-of-use assets

 

1,383,400

 

 

 

1,389,316

 

Deferred commissions

 

6,643

 

 

 

6,312

 

Intangibles, net

 

729,354

 

 

 

739,402

 

Goodwill

 

1,435,618

 

 

 

1,455,946

 

Deferred tax assets

 

3,453

 

 

 

3,660

 

Total assets

$

5,890,329

 

 

$

5,910,804

 

Liabilities and shareholders' equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

82,843

 

 

$

67,526

 

Accrued expenses and other liabilities

 

246,522

 

 

 

242,171

 

Income tax payable

 

2,022

 

 

 

5,404

 

Current portion of long-term debt

 

33,020

 

 

 

32,673

 

Income tax receivable liability

 

41,437

 

 

 

56,001

 

Advertising fund liabilities

 

33,208

 

 

 

23,392

 

Total current liabilities

 

439,052

 

 

 

427,167

 

Long-term debt

 

2,905,033

 

 

 

2,910,812

 

Deferred tax liabilities

 

149,931

 

 

 

154,742

 

Operating lease liabilities

 

1,319,936

 

 

 

1,332,519

 

Income tax receivable liability

 

108,215

 

 

 

117,915

 

Deferred revenue

 

32,159

 

 

 

30,507

 

Long-term accrued expenses and other liabilities

 

29,187

 

 

 

30,419

 

Total liabilities

 

4,983,513

 

 

 

5,004,081

 

Preferred Stock $0.01 par value; 100,000,000 shares authorized; none issued or outstanding

 

—

 

 

 

—

 

Common stock, $0.01 par value, 900,000,000 shares authorized: and 164,079,581 and 163,965,231 shares outstanding; respectively

 

1,641

 

 

 

1,640

 

Additional paid-in capital

 

1,664,764

 

 

 

1,652,401

 

Retained (deficit) earnings

 

(705,826

)

 

 

(710,087

)

Accumulated other comprehensive loss

 

(54,407

)

 

 

(37,875

)

Total shareholders’ equity attributable to Driven Brands Holdings Inc.

 

906,172

 

 

 

906,079

 

Non-controlling interests

 

644

 

 

 

644

 

Total shareholders' equity

 

906,816

 

 

 

906,723

 

Total liabilities and shareholders' equity

$

5,890,329

 

 

$

5,910,804

 

DRIVEN BRANDS HOLDINGS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

 

 

Three Months Ended

(in thousands)

March 30, 2024

 

April 1, 2023

Net income

$

4,261

 

 

$

29,749

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

43,229

 

 

 

38,198

 

Equity-based compensation expense

 

11,861

 

 

 

2,564

 

Loss on foreign denominated transactions

 

7,574

 

 

 

161

 

Gain on foreign currency derivatives

 

(3,253

)

 

 

(1,836

)

(Gain) loss on sale and disposal of businesses, fixed assets, and sale-leaseback transactions

 

(12,913

)

 

 

1,671

 

Reclassification of interest rate hedge to income

 

(519

)

 

 

(519

)

Bad debt expense

 

2,070

 

 

 

82

 

Asset impairment costs

 

19,326

 

 

 

167

 

Amortization of deferred financing costs and bond discounts

 

1,954

 

 

 

1,850

 

Amortization of cloud computing

 

1,345

 

 

 

—

 

Benefit for deferred income taxes

 

(2,807

)

 

 

4,650

 

Other, net

 

10,669

 

 

 

4,043

 

Changes in assets and liabilities, net of acquisitions:

 

 

 

Accounts and notes receivable, net

 

(17,351

)

 

 

(44,084

)

Inventory

 

(1,005

)

 

 

(5,473

)

Prepaid and other assets

 

(4,270

)

 

 

(13,867

)

Advertising fund assets and liabilities, restricted

 

7,650

 

 

 

906

 

Other Assets

 

(33,300

)

 

 

(7,382

)

Deferred commissions

 

(331

)

 

 

455

 

Deferred revenue

 

1,659

 

 

 

161

 

Accounts payable

 

14,165

 

 

 

25,597

 

Accrued expenses and other liabilities

 

6,293

 

 

 

(960

)

Income tax receivable

 

3,976

 

 

 

659

 

Cash provided by operating activities

 

60,283

 

 

 

36,792

 

Cash flows from investing activities:

 

 

 

Capital expenditures

 

(89,483

)

 

 

(169,155

)

Cash used in business acquisitions, net of cash acquired

 

(2,024

)

 

 

(29,307

)

Proceeds from sale-leaseback transactions

 

4,550

 

 

 

16,772

 

Proceeds from sale or disposal of businesses and fixed assets

 

52,677

 

 

 

—

 

Cash used in investing activities

 

(34,280

)

 

 

(181,690

)

Cash flows from financing activities:

 

 

 

Repayment of long-term debt

 

(7,616

)

 

 

(7,002

)

Proceeds from revolving lines of credit and short-term debt

 

46,000

 

 

 

140,000

 

Repayments of revolving lines of credit and short-term debt

 

(46,000

)

 

 

(25,000

)

Payment of Tax Receivable Agreement

 

(24,718

)

 

 

—

 

Repayment of principal portion of finance lease liability

 

(886

)

 

 

(854

)

Stock option exercises

 

—

 

 

 

1,380

 

Other, net

 

—

 

 

 

(32

)

Cash (used in) provided by financing activities

 

(33,220

)

 

 

108,492

 

Effect of exchange rate changes on cash

 

1,133

 

 

 

2,392

 

Net change in cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted

 

(6,084

)

 

 

(34,014

)

Cash and cash equivalents, beginning of period

 

176,522

 

 

 

227,110

 

Cash included in advertising fund assets, restricted, beginning of period

 

38,537

 

 

 

32,871

 

Restricted cash, beginning of period

 

657

 

 

 

792

 

Cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted, beginning of period

 

215,716

 

 

 

260,773

 

Cash and cash equivalents, end of period

 

165,513

 

 

 

190,841

 

Cash included in advertising fund assets, restricted, end of period

 

43,462

 

 

 

35,126

 

Restricted cash, end of period

 

657

 

 

 

792

 

Cash, cash equivalents, restricted cash, and cash included in advertising fund assets, restricted, end of period

$

209,632

 

 

$

226,759

 

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

The following information provides definitions and reconciliations of the non-GAAP financial measures presented in this earnings release to the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles (GAAP). The Company has provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The non-GAAP financial measures in this earnings release may differ from similarly titled measures used by other companies.

Non-GAAP Financial Measures in Outlook

Driven Brands includes Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“Adjusted EBITDA”) and Adjusted Earnings per Share (“Adjusted EPS”) in the Company’s Fiscal Year 2024 Outlook. Adjusted EBITDA and Adjusted EPS are non-GAAP financial measures and have not been reconciled to the most comparable GAAP financial measures because it is not possible to do so without unreasonable efforts due to the uncertainty and potential variability of reconciling items, which are dependent on future events and often outside of management’s control and which could be significant. Because such items cannot be reasonably predicted with the level of precision required, we are unable to provide an outlook for the comparable GAAP measures. Forward-looking estimates of Adjusted EBITDA and Adjusted EPS are made in a manner consistent with the relevant definitions and assumptions noted herein and in our filings with the SEC.

Adjusted Net Income and Adjusted Earnings Per Share

Adjusted Net Income and Adjusted EPS are considered non-GAAP financial measures under the SEC’s rules because they exclude certain amounts included in the net income attributable to Driven Brands common stockholders and diluted earnings per share attributable to Driven Brands common stockholders calculated in accordance with GAAP. Management believes that Adjusted Net Income and Adjusted EPS are meaningful measures to share with investors because they facilitate comparison of the current period performance with that of the comparable prior period. In addition, Adjusted Net Income and Adjusted EPS afford investors a view of what management considers to be Driven Brands’ core earnings performance as well as the ability to make a more informed assessment of such earnings performance with that of the prior period.

The tables below reflect the calculation of Adjusted Net Income and Adjusted Earnings Per Share for the three months ended March 30, 2024, compared to the three months ended April 1, 2023.

Net Income to Adjusted Net Income and Adjusted Earnings Per Share (Unaudited)

 

Three Months Ended

(in thousands, except per share data)

March 30, 2024

 

April 1, 2023

Net income

$

4,261

 

 

$

29,749

 

Acquisition related costs(a)

 

1,794

 

 

 

1,847

 

Non-core items and project costs, net(b)

 

4,711

 

 

 

1,824

 

Cloud computing amortization(c)

 

1,345

 

 

 

—

 

Equity-based compensation expense(d)

 

11,861

 

 

 

2,564

 

Foreign currency transaction loss (gain), net(e)

 

4,321

 

 

 

(1,675

)

Asset sale leaseback (gain) loss, impairment and closed store expenses(f)

 

9,560

 

 

 

1,844

 

Amortization related to acquired intangible assets(g)

 

7,020

 

 

 

6,036

 

Valuation allowance for deferred tax asset(h)

 

1,134

 

 

 

—

 

Adjusted net income before tax impact of adjustments

 

46,007

 

 

 

42,189

 

Tax impact of adjustments(i)

 

(7,885

)

 

 

(3,085

)

Adjusted net income

 

38,122

 

 

 

39,104

 

Net income attributable to non-controlling interest

 

—

 

 

 

—

 

Adjusted net income attributable to Driven Brands Holdings Inc.

$

38,122

 

 

$

39,104

 

 

 

 

 

Earnings per share

 

 

 

Basic

$

0.03

 

 

$

0.18

 

Diluted

$

0.03

 

 

$

0.17

 

 

 

 

 

Adjusted earnings per share(1)

 

 

 

Basic

$

0.23

 

 

$

0.24

 

Diluted

$

0.23

 

 

$

0.23

 

 

 

 

 

Weighted average shares outstanding for Net Income

 

 

 

Basic

 

159,631

 

 

 

162,784

 

Diluted

 

160,604

 

 

 

166,874

 

(1)

Adjusted Earnings Per Share is calculated under the two-class method. Under the two-class method, adjusted earnings per share is calculated using adjusted net income attributable to common shares, which is derived by reducing adjusted net income by the amount attributable to participating securities. Adjusted Net Income attributable to participating securities used in the basic and diluted earnings per share calculation was less than $1 million for the three months ended March 30, 2024 and April 1, 2023.

Adjusted EBITDA

Adjusted EBITDA is considered a non-GAAP financial measure under the Securities and Exchange Commission’s (“SEC”) rules because it excludes certain amounts included in net income calculated in accordance with GAAP. Management believes that Adjusted EBITDA is a meaningful measure to share with investors because it facilitates comparison of the current period performance with that of the comparable prior period. In addition, Adjusted EBITDA affords investors a view of what management considers to be Driven Brand’s core operating performance as well as the ability to make a more informed assessment of such operating performance as compared with that of the prior period.

Please see the company’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023, filed with the SEC on February 28, 2024, for additional information on Adjusted EBITDA. The tables below reflect the calculation of Adjusted EBITDA for the three months ended March 30, 2024, compared to the three months ended April 1, 2023.

Net Income to Adjusted EBITDA Reconciliation (Unaudited)

 

 

 

 

 

Three Months Ended

(in thousands)

March 30, 2024

 

April 1, 2023

Net income

$

4,261

 

$

29,749

 

Income tax expense

 

6,164

 

 

10,971

 

Interest expense, net

 

43,772

 

 

38,141

 

Depreciation and amortization

 

43,229

 

 

38,198

 

EBITDA

 

97,426

 

 

117,059

 

Acquisition related costs(a)

 

1,794

 

 

1,847

 

Non-core items and project costs, net(b)

 

4,711

 

 

1,824

 

Cloud computing amortization(c)

 

1,345

 

 

—

 

Equity-based compensation expense(d)

 

11,861

 

 

2,564

 

Foreign currency transaction loss (gain), net(e)

 

4,321

 

 

(1,675

)

Asset sale leaseback (gain) loss, impairment and closed store expenses(f)

 

9,560

 

 

1,844

 

Adjusted EBITDA

$

131,018

 

$

123,463

 

Adjusted EBITDA, Adjusted Net Income and Adjusted Earnings Per Share Footnotes

(a)

Consists of acquisition costs as reflected within the consolidated statements of operations, including legal, consulting and other fees, and expenses incurred in connection with acquisitions completed during the applicable period, as well as inventory rationalization expenses incurred in connection with acquisitions. We expect to incur similar costs in connection with other acquisitions in the future and, under U.S. GAAP, such costs relating to acquisitions are expensed as incurred and not capitalized.

(b)

Consists of discrete items and project costs, including third party consulting and professional fees associated with strategic transformation initiatives as well as non-recurring payroll-related costs.

(c)

Includes non-cash amortization expenses relating to cloud computing arrangements.

(d)

Represents non-cash equity-based compensation expense.

(e)

Represents foreign currency transaction (gains) losses, net that primarily related to the remeasurement of our intercompany loans as well as gains and losses on cross currency swaps and forward contracts.

(f)

Relates to (gains) losses, net on sale leasebacks, impairment of certain fixed assets and operating lease right-of-use assets related to closed and underperforming locations, assets held for sale, and lease exit costs and other costs associated with stores that were closed prior to the respective lease termination dates.

(g)

Consists of amortization related to acquired intangible assets as reflected within depreciation and amortization in the unaudited consolidated statement of operations.

(h)

Represents valuation allowances on income tax carryforwards in certain domestic jurisdictions that are not more likely than not to be realized.

(i)

Represents the tax impact of adjustments associated with the reconciling items between net income and Adjusted Net Income, excluding the provision for uncertain tax positions. To determine the tax impact of the deductible reconciling items, we utilized statutory income tax rates ranging from 9% to 36% depending upon the tax attributes of each adjustment and the applicable jurisdiction.

DRIVEN BRANDS HOLDINGS INC. AND SUBSIDIARIES

ADJUSTED EBITDA AND SEGMENT ADJUSTED EBITDA RECONCILIATION (UNAUDITED)

 

 

Three Months Ended

(in thousands)

March 30, 2024

 

April 1, 2023

Segment Adjusted EBITDA:

 

 

 

Maintenance

$

91,436

 

 

$

72,233

 

Car Wash

 

29,134

 

 

 

41,048

 

Paint, Collision & Glass

 

30,820

 

 

 

35,450

 

Platform Services

 

19,871

 

 

 

17,008

 

Corporate and other

 

(38,980

)

 

 

(41,251

)

Store opening costs

 

(1,263

)

 

 

(1,025

)

Adjusted EBITDA

$

131,018

 

 

$

123,463

 

DRIVEN BRANDS HOLDINGS INC. AND SUBSIDIARIES

ADDITIONAL INFORMATION ON KEY PERFORMANCE INDICATORS (UNAUDITED)

 

 

Three Months Ended March 30, 2024

(in thousands)

Maintenance

 

Car Wash

 

Paint, Collision & Glass

 

Platform Services

 

Total

System-wide Sales

 

 

 

 

 

 

 

 

 

Franchise stores

$

278,861

 

$

—

 

$

819,615

 

$

77,152

 

$

1,175,628

Company-operated stores

 

220,871

 

 

90,227

 

 

62,509

 

 

849

 

 

374,456

Independently operated stores

 

—

 

 

53,047

 

 

—

 

 

—

 

 

53,047

Total System-wide Sales

$

499,732

 

$

143,274

 

$

882,124

 

$

78,001

 

$

1,603,131

 

 

 

 

 

 

 

 

 

 

Store Count (in whole numbers)

 

 

 

 

 

 

 

 

 

Franchise stores

 

1,153

 

 

—

 

 

1,650

 

 

204

 

 

3,007

Company-operated stores

 

661

 

 

388

 

 

233

 

 

1

 

 

1,283

Independently operated stores

 

—

 

 

718

 

 

—

 

 

—

 

 

718

Total Store Count

 

1,814

 

 

1,106

 

 

1,883

 

 

205

 

 

5,008

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended April 1, 2023

(in thousands)

Maintenance

 

Car Wash

 

Paint,

Collision &

Glass

 

Platform

Services

 

Total

System-wide Sales

 

 

 

 

 

 

 

 

 

Franchise stores

$

246,683

 

$

—

 

$

738,563

 

$

89,103

 

$

1,074,349

Company-operated stores

 

195,260

 

 

102,446

 

 

77,479

 

 

881

 

 

376,066

Independently operated stores

 

—

 

 

52,532

 

 

—

 

 

—

 

 

52,532

Total System-wide Sales

$

441,943

 

$

154,978

 

$

816,042

 

$

89,984

 

$

1,502,947

 

 

 

 

 

 

 

 

 

 

Store Count (in whole numbers)

 

 

 

 

 

 

 

 

 

Franchise stores

 

1,067

 

 

—

 

 

1,642

 

 

204

 

 

2,913

Company-operated stores

 

599

 

 

400

 

 

235

 

 

1

 

 

1,235

Independently operated stores

 

—

 

 

716

 

 

—

 

 

—

 

 

716

Total Store Count

 

1,666

 

 

1,116

 

 

1,877

 

 

205

 

 

4,864

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240502248037/en/

Shareholder/Analyst inquiries: Dawn Francfort ICR, Inc. investors@drivenbrands.com (203) 682-8200

Media inquiries: Taylor Blanchard taylor.blanchard@drivenbrands.com (704) 644-8129