Condensed Consolidating Financial Information (Tables)

6 Months Ended

Jun. 30, 2019

Condensed Consolidating Financial Information

CONDENSED CONSOLIDATING BALANCE SHEET

CONDENSED CONSOLIDATING BALANCE SHEET

June 30, 2019

					Penske
	Total				Automotive		Guarantor		Non-Guarantor
	Company		Eliminations		Group		Subsidiaries		Subsidiaries
Cash and cash equivalents	$	43.8	$	—	$	—	$	2.5	$	41.3
Accounts receivable, net		944.4		(490.9)		490.9		462.3		482.1
Inventories		3,978.0		—		—		1,966.1		2,011.9
Other current assets		109.1		—		8.6		21.8		78.7
Total current assets		5,075.3		(490.9)		499.5		2,452.7		2,614.0
Property and equipment, net		2,308.9		—		3.8		1,101.0		1,204.1
Operating lease right-of-use assets		2,380.9		—		9.5		1,600.0		771.4
Intangible assets		2,235.0		—		—		1,422.2		812.8
Equity method investments		1,342.2		—		1,276.4		—		65.8
Other long-term assets		18.8		(2,830.9)		2,838.6		2.8		8.3
Total assets	$	13,361.1	$	(3,321.8)	$	4,627.8	$	6,578.7	$	5,476.4
Floor plan notes payable	$	2,350.3	$	—	$	—	$	1,350.6	$	999.7
Floor plan notes payable — non-trade		1,435.5		—		225.9		473.1		736.5
Accounts payable		638.5		—		4.9		177.5		456.1
Accrued expenses and other current liabilities		651.8		(490.9)		1.7		222.0		919.0
Current portion of long-term debt		93.3		—		—		10.4		82.9
Liabilities held for sale		0.5		—		—		0.5		—
Total current liabilities		5,169.9		(490.9)		232.5		2,234.1		3,194.2
Long-term debt		2,134.2		(82.3)		1,725.2		259.0		232.3
Long-term operating lease liabilities		2,330.3		—		9.1		1,573.0		748.2
Deferred tax liabilities		604.1		—		—		598.9		5.2
Other long-term liabilities		461.6		—		—		32.0		429.6
Total liabilities		10,700.1		(573.2)		1,966.8		4,697.0		4,609.5
Total equity		2,661.0		(2,748.6)		2,661.0		1,881.7		866.9
Total liabilities and equity	$	13,361.1	$	(3,321.8)	$	4,627.8	$	6,578.7	$	5,476.4

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2018

					Penske
	Total				Automotive		Guarantor		Non-Guarantor
	Company		Eliminations		Group		Subsidiaries		Subsidiaries
Cash and cash equivalents	$	39.4	$	—	$	—	$	12.9	$	26.5
Accounts receivable, net		929.1		(481.7)		481.7		507.1		422.0
Inventories		4,040.1		—		—		1,961.6		2,078.5
Other current assets		86.6		—		10.6		17.8		58.2
Total current assets		5,095.2		(481.7)		492.3		2,499.4		2,585.2
Property and equipment, net		2,250.0		—		3.9		1,077.7		1,168.4
Intangible assets		2,238.2		—		—		1,422.6		815.6
Equity method investments		1,305.2		—		1,239.9		—		65.3
Other long-term assets		15.9		(2,814.3)		2,821.0		2.9		6.3
Total assets	$	10,904.5	$	(3,296.0)	$	4,557.1	$	5,002.6	$	4,640.8
Floor plan notes payable	$	2,362.2	$	—	$	—	$	1,348.3	$	1,013.9
Floor plan notes payable — non-trade		1,428.6		—		232.3		505.9		690.4
Accounts payable		598.2		—		4.9		196.6		396.7
Accrued expenses		566.6		(481.7)		1.4		160.2		886.7
Current portion of long-term debt		92.0		—		—		6.3		85.7
Liabilities held for sale		0.7		—		—		0.7		—
Total current liabilities		5,048.3		(481.7)		238.6		2,218.0		3,073.4
Long-term debt		2,124.7		(88.6)		1,683.8		225.7		303.8
Deferred tax liabilities		577.8		—		—		570.5		7.3
Other long-term liabilities		519.0		—		—		57.6		461.4
Total liabilities		8,269.8		(570.3)		1,922.4		3,071.8		3,845.9
Total equity		2,634.7		(2,725.7)		2,634.7		1,930.8		794.9
Total liabilities and equity	$	10,904.5	$	(3,296.0)	$	4,557.1	$	5,002.6	$	4,640.8

CONDENSED CONSOLIDATING STATEMENT OF INCOME

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended June 30, 2019

					Penske
	Total				Automotive		Guarantor		Non-Guarantor
	Company		Eliminations		Group		Subsidiaries		Subsidiaries
Revenues	$	5,755.8	$	—	$	—	$	3,127.6	$	2,628.2
Cost of sales		4,888.0		—		—		2,628.9		2,259.1
Gross profit		867.8		—		—		498.7		369.1
Selling, general and administrative expenses		668.9		—		6.8		364.5		297.6
Depreciation		27.1		—		0.4		14.6		12.1
Operating income		171.8		—		(7.2)		119.6		59.4
Floor plan interest expense		(21.0)		—		(2.4)		(14.3)		(4.3)
Other interest expense		(30.4)		—		(19.3)		(3.0)		(8.1)
Equity in earnings of affiliates		39.5		—		38.0		—		1.5
Equity in earnings of subsidiaries		—		(150.0)		150.0		—		—
Income from continuing operations before income taxes		159.9		(150.0)		159.1		102.3		48.5
Income taxes		(41.5)		39.1		(41.5)		(29.5)		(9.6)
Income from continuing operations		118.4		(110.9)		117.6		72.8		38.9
Income from discontinued operations, net of tax		0.1		(0.1)		0.1		0.1		—
Net income		118.5		(111.0)		117.7		72.9		38.9
Other comprehensive (loss) income, net of tax		(14.5)		17.2		(14.5)		—		(17.2)
Comprehensive income		104.0		(93.8)		103.2		72.9		21.7
Less: Comprehensive income (loss) attributable to non-controlling interests		0.8		(0.2)		0.2		—		0.8
Comprehensive income attributable to Penske Automotive Group common stockholders	$	103.2	$	(93.6)	$	103.0	$	72.9	$	20.9

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended June 30, 2018

					Penske
	Total				Automotive		Guarantor		Non-Guarantor
	Company		Eliminations		Group		Subsidiaries		Subsidiaries
Revenues	$	5,940.3	$	—	$	—	$	3,071.8	$	2,868.5
Cost of sales		5,050.5		—		—		2,582.3		2,468.2
Gross profit		889.8		—		—		489.5		400.3
Selling, general and administrative expenses		675.4		—		6.6		359.7		309.1
Depreciation		25.7		—		0.4		13.7		11.6
Operating income		188.7		—		(7.0)		116.1		79.6
Floor plan interest expense		(19.9)		—		(1.8)		(12.3)		(5.8)
Other interest expense		(28.6)		—		(18.9)		(2.0)		(7.7)
Equity in earnings of affiliates		36.0		—		35.0		—		1.0
Equity in earnings of subsidiaries		—		(168.3)		168.3		—		—
Income from continuing operations before income taxes		176.2		(168.3)		175.6		101.8		67.1
Income taxes		(41.0)		39.4		(41.0)		(27.4)		(12.0)
Income from continuing operations		135.2		(128.9)		134.6		74.4		55.1
Income from discontinued operations, net of tax		—		—		—		—		—
Net income		135.2		(128.9)		134.6		74.4		55.1
Other comprehensive (loss) income, net of tax		(72.8)		68.1		(72.8)		—		(68.1)
Comprehensive income		62.4		(60.8)		61.8		74.4		(13.0)
Less: Comprehensive (loss) income attributable to non-controlling interests		(0.5)		1.1		(1.1)		—		(0.5)
Comprehensive income attributable to Penske Automotive Group common stockholders	$	62.9	$	(61.9)	$	62.9	$	74.4	$	(12.5)

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Six Months Ended June 30, 2019

					Penske
	Total				Automotive		Guarantor		Non-Guarantor
	Company		Eliminations		Group		Subsidiaries		Subsidiaries
Revenues	$	11,320.2	$	—	$	—	$	5,979.0	$	5,341.2
Cost of sales		9,600.9		—		—		5,011.8		4,589.1
Gross profit		1,719.3		—		—		967.2		752.1
Selling, general and administrative expenses		1,335.3		—		13.4		722.9		599.0
Depreciation		53.5		—		0.7		29.1		23.7
Operating income		330.5		—		(14.1)		215.2		129.4
Floor plan interest expense		(42.8)		—		(4.2)		(29.3)		(9.3)
Other interest expense		(60.3)		—		(38.5)		(6.0)		(15.8)
Equity in earnings of affiliates		66.3		—		63.8		—		2.5
Equity in earnings of subsidiaries		—		(287.1)		287.1		—		—
Income from continuing operations before income taxes		293.7		(287.1)		294.1		179.9		106.8
Income taxes		(76.2)		74.4		(76.3)		(52.5)		(21.8)
Income from continuing operations		217.5		(212.7)		217.8		127.4		85.0
Income from discontinued operations, net of tax		0.2		(0.2)		0.2		0.2		—
Net income		217.7		(212.9)		218.0		127.6		85.0
Other comprehensive (loss) income, net of tax		(6.0)		10.3		(6.0)		—		(10.3)
Comprehensive income		211.7		(202.6)		212.0		127.6		74.7
Less: Comprehensive (loss) income attributable to non-controlling interests		(0.5)		0.1		(0.1)		—		(0.5)
Comprehensive income attributable to Penske Automotive Group common stockholders	$	212.2	$	(202.7)	$	212.1	$	127.6	$	75.2

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Six Months Ended June 30, 2018

					Penske
	Total				Automotive		Guarantor		Non-Guarantor
	Company		Eliminations		Group		Subsidiaries		Subsidiaries
Revenues	$	11,687.2	$	—	$	—	$	5,928.3	$	5,758.9
Cost of sales		9,933.0		—		—		4,977.5		4,955.5
Gross profit		1,754.2		—		—		950.8		803.4
Selling, general and administrative expenses		1,338.5		—		12.8		703.0		622.7
Depreciation		51.3		—		0.8		27.3		23.2
Operating income		364.4		—		(13.6)		220.5		157.5
Floor plan interest expense		(38.8)		—		(3.4)		(23.6)		(11.8)
Other interest expense		(58.4)		—		(39.7)		(3.9)		(14.8)
Equity in earnings of affiliates		53.3		—		51.0		—		2.3
Equity in earnings of subsidiaries		—		(325.9)		325.9		—		—
Income from continuing operations before income taxes		320.5		(325.9)		320.2		193.0		133.2
Income taxes		(77.6)		79.2		(77.6)		(52.4)		(26.8)
Income from continuing operations		242.9		(246.7)		242.6		140.6		106.4
Loss from discontinued operations, net of tax		0.1		(0.1)		0.1		0.1		—
Net income		243.0		(246.8)		242.7		140.7		106.4
Other comprehensive (loss) income, net of tax		(41.0)		36.6		(41.0)		—		(36.6)
Comprehensive income		202.0		(210.2)		201.7		140.7		69.8
Less: Comprehensive (loss) income attributable to non-controlling interests		(0.8)		1.1		(1.1)		—		(0.8)
Comprehensive income attributable to Penske Automotive Group common stockholders	$	202.8	$	(211.3)	$	202.8	$	140.7	$	70.6

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six Months Ended June 30, 2019

			Penske
	Total		Automotive		Guarantor		Non-Guarantor
	Company		Group		Subsidiaries		Subsidiaries
Net cash provided by (used in) continuing operating activities	$	304.6	$	(18.4)	$	214.0	$	109.0
Investing activities:
Purchase of equipment and improvements		(134.5)		(0.7)		(56.0)		(77.8)
Proceeds from sale of dealerships		7.2		—		7.2		—
Proceeds from sale-leaseback transactions		7.3		—		—		7.3
Acquisitions, net		(1.1)		—		—		(1.1)
Other		(0.9)		(1.3)		—		0.4
Net cash used in continuing investing activities		(122.0)		(2.0)		(48.8)		(71.2)
Financing activities:
Net borrowings (repayments) of long-term debt		9.8		39.9		37.0		(67.1)
Net borrowings (repayments) of floor plan notes payable — non-trade		6.8		(6.4)		(32.8)		46.0
Repurchases of common stock		(130.6)		(130.6)		—		—
Dividends		(64.5)		(64.5)		—		—
Other		0.4		0.4		—		—
Distributions from (to) parent		—		181.6		(179.8)		(1.8)
Net cash (used in) provided by continuing financing activities		(178.1)		20.4		(175.6)		(22.9)
Net cash (used in) provided by discontinued operations		—		—		—		—
Effect of exchange rate changes on cash and cash equivalents		(0.1)		—		—		(0.1)
Net change in cash and cash equivalents		4.4		—		(10.4)		14.8
Cash and cash equivalents, beginning of period		39.4		—		12.9		26.5
Cash and cash equivalents, end of period	$	43.8	$	—	$	2.5	$	41.3

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Six Months Ended June 30, 2018

			Penske
	Total		Automotive		Guarantor		Non-Guarantor
	Company		Group		Subsidiaries		Subsidiaries
Net cash provided by (used in) continuing operating activities	$	417.0	$	(24.5)	$	357.2	$	84.3
Investing activities:
Purchase of equipment and improvements		(118.8)		(0.4)		(68.4)		(50.0)
Proceeds from sale of dealerships		58.4		—		55.9		2.5
Proceeds from sale-leaseback transactions		5.8		—		—		5.8
Acquisitions, net		(168.6)		—		—		(168.6)
Other		(3.0)		(1.9)		—		(1.1)
Net cash (used in) provided by continuing investing activities		(226.2)		(2.3)		(12.5)		(211.4)
Financing activities:
Net borrowings (repayments) of long-term debt		23.1		(73.0)		(56.5)		152.6
Net (repayments) borrowings of floor plan notes payable — non-trade		(92.9)		1.8		(98.8)		4.1
Repurchases of common stock		(55.8)		(55.8)		—		—
Dividends		(59.0)		(59.0)		—		—
Other		(6.1)		(0.3)		(5.8)		—
Distributions from (to) parent		—		213.1		(198.2)		(14.9)
Net cash (used in) provided by continuing financing activities		(190.7)		26.8		(359.3)		141.8
Net cash provided by discontinued operations		0.2		—		0.2		—
Effect of exchange rate changes on cash and cash equivalents		(0.2)		—		—		(0.2)
Net change in cash and cash equivalents		0.1		—		(14.4)		14.5
Cash and cash equivalents, beginning of period		45.7		—		14.8		30.9
Cash and cash equivalents, end of period	$	45.8	$	—	$	0.4	$	45.4