QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
(Address of principal executive offices) | (Zip Code) |
Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered | |||||||||||||||||||||
Global Select Market |
☒ | Accelerated Filer | ☐ | |||||||||
Non-accelerated Filer | ☐ | Smaller Reporting Company | |||||||||
Emerging Growth Company |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Revenue | $ | $ | $ | $ | |||||||||||||||||||
Cost of goods sold | |||||||||||||||||||||||
Gross margin | |||||||||||||||||||||||
Selling, general and administrative expenses | |||||||||||||||||||||||
Restructuring and acquisition related expenses | |||||||||||||||||||||||
Impairment of net assets held for sale and (gain) loss on disposal of businesses | ( | ||||||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||
Operating income | |||||||||||||||||||||||
Other expense (income): | |||||||||||||||||||||||
Interest expense, net of interest income | |||||||||||||||||||||||
Loss on debt extinguishment | |||||||||||||||||||||||
Other (income) expense, net | ( | ( | ( | ||||||||||||||||||||
Total other expense, net | |||||||||||||||||||||||
Income from continuing operations before provision for income taxes | |||||||||||||||||||||||
Provision for income taxes | |||||||||||||||||||||||
Equity in earnings of unconsolidated subsidiaries | |||||||||||||||||||||||
Income from continuing operations | |||||||||||||||||||||||
Net loss from discontinued operations | ( | ||||||||||||||||||||||
Net income | |||||||||||||||||||||||
Less: net (loss) income attributable to continuing noncontrolling interest | ( | ||||||||||||||||||||||
Less: net income attributable to discontinued noncontrolling interest | |||||||||||||||||||||||
Net income attributable to LKQ stockholders | $ | $ | $ | $ | |||||||||||||||||||
Basic earnings per share: (1) | |||||||||||||||||||||||
Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Net loss from discontinued operations | ( | ||||||||||||||||||||||
Net income | |||||||||||||||||||||||
Less: net (loss) income attributable to continuing noncontrolling interest | ( | ||||||||||||||||||||||
Less: net income attributable to discontinued noncontrolling interest | |||||||||||||||||||||||
Net income attributable to LKQ stockholders | $ | $ | $ | $ | |||||||||||||||||||
Diluted earnings per share: (1) | |||||||||||||||||||||||
Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Net loss from discontinued operations | ( | ||||||||||||||||||||||
Net income | |||||||||||||||||||||||
Less: net (loss) income attributable to continuing noncontrolling interest | ( | ||||||||||||||||||||||
Less: net income attributable to discontinued noncontrolling interest | |||||||||||||||||||||||
Net income attributable to LKQ stockholders | $ | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Less: net (loss) income attributable to continuing noncontrolling interest | ( | ||||||||||||||||||||||
Less: net income attributable to discontinued noncontrolling interest | |||||||||||||||||||||||
Net income attributable to LKQ stockholders | |||||||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||||||
Foreign currency translation, net of tax | ( | ( | ( | ||||||||||||||||||||
Net change in unrealized gains/losses on cash flow hedges, net of tax | ( | ||||||||||||||||||||||
Net change in unrealized gains/losses on pension plans, net of tax | |||||||||||||||||||||||
Other comprehensive income (loss) from unconsolidated subsidiaries | ( | ( | ( | ||||||||||||||||||||
Other comprehensive income (loss) | ( | ( | ( | ||||||||||||||||||||
Comprehensive income | |||||||||||||||||||||||
Less: comprehensive (loss) income attributable to continuing noncontrolling interest | ( | ||||||||||||||||||||||
Less: comprehensive income attributable to discontinued noncontrolling interest | |||||||||||||||||||||||
Comprehensive income attributable to LKQ stockholders | $ | $ | $ | $ |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Assets | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Receivables, net | |||||||||||
Inventories | |||||||||||
Prepaid expenses and other current assets | |||||||||||
Total current assets | |||||||||||
Property, plant and equipment, net | |||||||||||
Operating lease assets, net | |||||||||||
Intangible assets: | |||||||||||
Goodwill | |||||||||||
Other intangibles, net | |||||||||||
Equity method investments | |||||||||||
Other noncurrent assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities and Stockholders' Equity | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | $ | |||||||||
Accrued expenses: | |||||||||||
Accrued payroll-related liabilities | |||||||||||
Refund liability | |||||||||||
Other accrued expenses | |||||||||||
Other current liabilities | |||||||||||
Current portion of operating lease liabilities | |||||||||||
Current portion of long-term obligations | |||||||||||
Total current liabilities | |||||||||||
Long-term operating lease liabilities, excluding current portion | |||||||||||
Long-term obligations, excluding current portion | |||||||||||
Deferred income taxes | |||||||||||
Other noncurrent liabilities | |||||||||||
Commitments and contingencies | |||||||||||
Redeemable noncontrolling interest | |||||||||||
Stockholders' equity: | |||||||||||
Common stock, $0.01 par value, 1,000,000,000 shares authorized, 321,553,252 shares issued and 292,243,742 shares outstanding at September 30, 2021; 320,867,602 shares issued and 303,553,000 shares outstanding at December 31, 2020 | |||||||||||
Additional paid-in capital | |||||||||||
Retained earnings | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Treasury stock, at cost; 29,309,510 shares at September 30, 2021 and 17,314,602 shares at December 31, 2020 | ( | ( | |||||||||
Total Company stockholders' equity | |||||||||||
Noncontrolling interest | |||||||||||
Total stockholders' equity | |||||||||||
Total liabilities and stockholders' equity | $ | $ | |||||||||
Nine Months Ended | |||||||||||
September 30, | |||||||||||
2021 | 2020 | ||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | |||||||||||
Stock-based compensation expense | |||||||||||
Loss on debt extinguishment | |||||||||||
Other | ( | ( | |||||||||
Changes in operating assets and liabilities, net of effects from acquisitions and dispositions: | |||||||||||
Receivables, net | ( | ( | |||||||||
Inventories | ( | ||||||||||
Prepaid income taxes/income taxes payable | ( | ( | |||||||||
Accounts payable | ( | ||||||||||
Other operating assets and liabilities | |||||||||||
Net cash provided by operating activities | |||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
Purchases of property, plant and equipment | ( | ( | |||||||||
Proceeds from disposals of property, plant and equipment | |||||||||||
Acquisitions, net of cash acquired | ( | ( | |||||||||
Other investing activities, net | ( | ( | |||||||||
Net cash used in investing activities | ( | ( | |||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
Early-redemption premium | ( | ( | |||||||||
Repayment of Euro Notes (2026) | ( | ||||||||||
Repayment of U.S. Notes (2023) | ( | ||||||||||
Borrowings under revolving credit facilities | |||||||||||
Repayments under revolving credit facilities | ( | ( | |||||||||
Repayments under term loans | ( | ( | |||||||||
Borrowings under receivables securitization facility | |||||||||||
Repayments under receivables securitization facility | ( | ||||||||||
Repayments of other debt, net | ( | ( | |||||||||
Settlement of derivative instruments, net | ( | ||||||||||
Purchase of treasury stock | ( | ( | |||||||||
Other financing activities, net | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | ( | ||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | ||||||||||
Cash and cash equivalents of continuing operations, beginning of period (1) | |||||||||||
Add: Cash and cash equivalents of discontinued operations, beginning of period | |||||||||||
Cash and cash equivalents of continuing and discontinued operations, beginning of period | |||||||||||
Cash and cash equivalents, end of period | $ | $ | |||||||||
(1) The balance as of January 1, 2020 included restricted cash of $5 million. | |||||||||||
Nine Months Ended | |||||||||||
September 30, | |||||||||||
2021 | 2020 | ||||||||||
Supplemental disclosure of cash paid for: | |||||||||||
Income taxes, net of refunds | $ | $ | |||||||||
Interest | |||||||||||
Supplemental disclosure of noncash investing and financing activities: | |||||||||||
Leased assets obtained in exchange for finance lease liabilities | $ | $ | |||||||||
Leased assets obtained in exchange for operating lease liabilities | |||||||||||
Noncash property, plant and equipment and software intangible additions in accounts payable and other accrued expenses | |||||||||||
Notes payable and other financing obligations, including notes issued and debt assumed in connection with business acquisitions and disposals | |||||||||||
Notes receivable and contingent consideration receivable acquired in connection with disposal of businesses | |||||||||||
Contingent consideration liabilities |
LKQ Stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interest | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE, July 1, 2021 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Purchase of treasury stock | — | — | ( | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of shares withheld for employee tax | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Capital contributions from, net of dividends declared to, noncontrolling interest shareholder | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Disposition of subsidiary with noncontrolling interests | — | — | — | — | — | — | — | (145) | (145) | ||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment on noncontrolling interest | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
BALANCE, September 30, 2021 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ |
LKQ Stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Noncontrolling Interest | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE, July 1, 2020 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of shares withheld for employee tax | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Dividends declared to noncontrolling interest shareholder | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
BALANCE, September 30, 2020 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ |
LKQ Stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interest | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE, January 1, 2021 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Purchase of treasury stock | — | — | ( | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of shares withheld for employee tax | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Capital contributions from, net of dividends declared to, noncontrolling interest shareholder | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Disposition of subsidiary with noncontrolling interests | — | — | — | — | — | — | — | (145) | (145) | ||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment on noncontrolling interest | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
BALANCE, September 30, 2021 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ |
LKQ Stockholders | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interest | Total Stockholders' Equity | |||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||
BALANCE, January 1, 2020 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Purchase of treasury stock | — | — | ( | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of shares withheld for employee tax | — | — | ( | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
Capital contributions from, net of dividends declared to, noncontrolling interest shareholder | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Adoption of ASU 2016-13 | — | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Disposition of subsidiary with noncontrolling interests(1) | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
BALANCE, September 30, 2020 | $ | ( | $ | ( | $ | $ | $ | ( | $ | $ |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Aftermarket and refurbished products | $ | $ | |||||||||
Salvage and remanufactured products | |||||||||||
Manufactured products | |||||||||||
Total inventories | $ | $ |
Balance as of December 31, 2020 | $ | ||||
Warranty expense | |||||
Warranty claims | ( | ||||
Balance as of September 30, 2021 | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Cost of goods sold | $ | $ | $ | $ | |||||||||||||||||||
Selling, general and administrative expenses | |||||||||||||||||||||||
Total government assistance | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
North America | $ | $ | $ | $ | |||||||||||||||||||
Europe | |||||||||||||||||||||||
Specialty | |||||||||||||||||||||||
Parts and services | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Total revenue | $ | $ | $ | $ |
Balance as of January 1, 2021 | $ | ||||
Additional warranty revenue deferred | |||||
Warranty revenue recognized | ( | ||||
Balance as of September 30, 2021 | $ |
Number Outstanding | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in thousands) (1) | ||||||||||||||||||||
Unvested as of January 1, 2021 | $ | ||||||||||||||||||||||
Granted (2) | $ | ||||||||||||||||||||||
Vested | ( | $ | |||||||||||||||||||||
Forfeited / Canceled | ( | $ | |||||||||||||||||||||
Unvested as of September 30, 2021 | $ | ||||||||||||||||||||||
Expected to vest after September 30, 2021 | $ | $ |
Number Outstanding | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (in thousands) (1) | ||||||||||||||||||||
Unvested as of January 1, 2021 | $ | ||||||||||||||||||||||
Granted (2) | $ | ||||||||||||||||||||||
Forfeited / Canceled | ( | $ | |||||||||||||||||||||
Unvested as of September 30, 2021 | $ | ||||||||||||||||||||||
Expected to vest after September 30, 2021 | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Income from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Denominator for basic earnings per share—Weighted-average shares outstanding | |||||||||||||||||||||||
Effect of dilutive securities: | |||||||||||||||||||||||
RSUs | |||||||||||||||||||||||
PSUs | |||||||||||||||||||||||
Stock options | |||||||||||||||||||||||
Denominator for diluted earnings per share—Adjusted weighted-average shares outstanding | |||||||||||||||||||||||
Basic earnings per share from continuing operations | $ | $ | $ | $ | |||||||||||||||||||
Diluted earnings per share from continuing operations (1) | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Antidilutive securities: | |||||||||||||||||||||||
RSUs | |||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||
September 30, 2021 | ||||||||||||||||||||||||||||||||
Foreign Currency Translation | Unrealized Gain (Loss) on Cash Flow Hedges | Unrealized Gain (Loss) on Pension Plans | Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries | Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||||||
BALANCE, July 1, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||
Pretax loss | ( | ( | ||||||||||||||||||||||||||||||
Income tax effect | ||||||||||||||||||||||||||||||||
Reclassification of unrealized loss | ||||||||||||||||||||||||||||||||
Reclassification of deferred income taxes | ( | ( | ||||||||||||||||||||||||||||||
Other comprehensive income from unconsolidated subsidiaries | ||||||||||||||||||||||||||||||||
BALANCE, September 30, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Three Months Ended | ||||||||||||||||||||||||||||||||
September 30, 2020 | ||||||||||||||||||||||||||||||||
Foreign Currency Translation | Unrealized Gain (Loss) on Cash Flow Hedges | Unrealized Gain (Loss) on Pension Plans | Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries | Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||||||
BALANCE, July 1, 2020 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||
Pretax income (loss) | ( | ( | ||||||||||||||||||||||||||||||
Income tax effect | ||||||||||||||||||||||||||||||||
Reclassification of unrealized loss | ||||||||||||||||||||||||||||||||
Reclassification of deferred income taxes | ( | ( | ( | |||||||||||||||||||||||||||||
Other comprehensive loss from unconsolidated subsidiaries | ( | ( | ||||||||||||||||||||||||||||||
BALANCE, September 30, 2020 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Nine Months Ended | ||||||||||||||||||||||||||||||||
September 30, 2021 | ||||||||||||||||||||||||||||||||
Foreign Currency Translation | Unrealized Gain (Loss) on Cash Flow Hedges | Unrealized Gain (Loss) on Pension Plans | Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries | Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||||||
BALANCE, January 1, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||
Pretax (loss) income | ( | ( | ||||||||||||||||||||||||||||||
Income tax effect | ( | ( | ||||||||||||||||||||||||||||||
Reclassification of unrealized (gain) loss | ( | ( | ||||||||||||||||||||||||||||||
Reclassification of deferred income taxes | ( | |||||||||||||||||||||||||||||||
Other comprehensive loss from unconsolidated subsidiaries | ( | ( | ||||||||||||||||||||||||||||||
BALANCE, September 30, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Nine Months Ended | ||||||||||||||||||||||||||||||||
September 30, 2020 | ||||||||||||||||||||||||||||||||
Foreign Currency Translation | Unrealized Gain (Loss) on Cash Flow Hedges | Unrealized Gain (Loss) on Pension Plans | Other Comprehensive Income (Loss) from Unconsolidated Subsidiaries | Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||||||
BALANCE, January 1, 2020 | $ | ( | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||
Pretax loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||
Income tax effect | ||||||||||||||||||||||||||||||||
Reclassification of unrealized loss | ||||||||||||||||||||||||||||||||
Reclassification of deferred income taxes | ( | ( | ( | |||||||||||||||||||||||||||||
Disposal of business | ||||||||||||||||||||||||||||||||
Other comprehensive loss from unconsolidated subsidiaries | ( | ( | ||||||||||||||||||||||||||||||
BALANCE, September 30, 2020 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||||||||
Classification | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||||||||
Unrealized losses on interest rate swaps | Interest expense, net of interest income | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||||||
Unrealized gains on cross currency swaps | Interest expense, net of interest income | |||||||||||||||||||||||||||||||
Unrealized (losses) gains on cross currency swaps (1) | Other (income) expense, net | ( | ( | |||||||||||||||||||||||||||||
Unrealized gains on foreign currency forward contracts (1) | Other (income) expense, net | |||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Senior secured credit agreement: | |||||||||||
Term loans payable | $ | $ | |||||||||
Revolving credit facilities | |||||||||||
Euro Notes (2024) | |||||||||||
Euro Notes (2026/28) | |||||||||||
Notes payable through October 2030 at weighted average interest rates of 3.1% and 3.3%, respectively | |||||||||||
Finance lease obligations at weighted average interest rates of 3.5% and 3.5%, respectively | |||||||||||
Other debt at weighted average interest rates of 0.7% and 1.2%, respectively | |||||||||||
Total debt | |||||||||||
Less: long-term debt issuance costs | ( | ( | |||||||||
Less: current debt issuance costs | ( | ( | |||||||||
Total debt, net of debt issuance costs | |||||||||||
Less: current maturities, net of debt issuance costs | ( | ( | |||||||||
Long term debt, net of debt issuance costs | $ | $ |
December 31, 2020 | ||||||||
Interest rate swap agreements | ||||||||
USD denominated | $ | |||||||
Cross currency swap agreements | ||||||||
Euro denominated | € | |||||||
Foreign currency forward contracts | ||||||||
SEK denominated | kr |
Other Accrued Expenses | ||||||||
Fair Value at December 31, 2020 | ||||||||
Interest rate swap agreements | $ | |||||||
Cross currency swap agreements | ||||||||
Foreign currency forward contracts | ||||||||
Total cash flow hedges | $ |
Balance as of September 30, 2021 | Fair Value Measurements as of September 30, 2021 | ||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Cash surrender value of life insurance | $ | $ | $ | $ | |||||||||||||||||||
Total Assets | $ | $ | $ | $ | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Contingent consideration liabilities | $ | $ | $ | $ | |||||||||||||||||||
Deferred compensation liabilities | |||||||||||||||||||||||
Total Liabilities | $ | $ | $ | $ |
Balance as of December 31, 2020 | Fair Value Measurements as of December 31, 2020 | ||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Cash surrender value of life insurance | $ | $ | $ | $ | |||||||||||||||||||
Total Assets | $ | $ | $ | $ | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Contingent consideration liabilities | $ | $ | $ | $ | |||||||||||||||||||
Interest rate swaps | |||||||||||||||||||||||
Deferred compensation liabilities | |||||||||||||||||||||||
Cross currency swap agreements | |||||||||||||||||||||||
Foreign currency forward contracts | |||||||||||||||||||||||
Total Liabilities | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Service cost | $ | $ | $ | $ | |||||||||||||||||||
Interest cost | |||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||
Amortization of actuarial loss | |||||||||||||||||||||||
Settlement loss (1) | |||||||||||||||||||||||
Net periodic benefit cost | $ | $ | $ | $ |
North America | Europe | Specialty | Eliminations | Consolidated | |||||||||||||||||||||||||
Three Months Ended September 30, 2021 | |||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||
Third Party | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Intersegment | ( | ||||||||||||||||||||||||||||
Total segment revenue | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
Segment EBITDA | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Depreciation and amortization (1) | |||||||||||||||||||||||||||||
Three Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||
Third Party | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Intersegment | ( | ||||||||||||||||||||||||||||
Total segment revenue | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
Segment EBITDA | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Depreciation and amortization (1) |
North America | Europe | Specialty | Eliminations | Consolidated | |||||||||||||||||||||||||
Nine Months Ended September 30, 2021 | |||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||
Third Party | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Intersegment | ( | ||||||||||||||||||||||||||||
Total segment revenue | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
Segment EBITDA | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Depreciation and amortization (1) | |||||||||||||||||||||||||||||
Nine Months Ended September 30, 2020 | |||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||
Third Party | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Intersegment | ( | ||||||||||||||||||||||||||||
Total segment revenue | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||
Segment EBITDA | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
Depreciation and amortization (1) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Less: net (loss) income attributable to continuing noncontrolling interest | ( | ||||||||||||||||||||||
Less: net income attributable to discontinued noncontrolling interest | |||||||||||||||||||||||
Net income attributable to LKQ stockholders | |||||||||||||||||||||||
Subtract: | |||||||||||||||||||||||
Net loss from discontinued operations | ( | ||||||||||||||||||||||
Net income attributable to discontinued noncontrolling interest | ( | ||||||||||||||||||||||
Net income from continuing operations attributable to LKQ stockholders | |||||||||||||||||||||||
Add: | |||||||||||||||||||||||
Depreciation and amortization | |||||||||||||||||||||||
Depreciation and amortization - cost of goods sold | |||||||||||||||||||||||
Depreciation and amortization - restructuring expenses (1) | |||||||||||||||||||||||
Interest expense, net of interest income | |||||||||||||||||||||||
Loss on debt extinguishment | |||||||||||||||||||||||
Provision for income taxes | |||||||||||||||||||||||
EBITDA | |||||||||||||||||||||||
Subtract: | |||||||||||||||||||||||
Equity in earnings of unconsolidated subsidiaries (2) | |||||||||||||||||||||||
Equity investment mark to market adjustments | |||||||||||||||||||||||
Add: | |||||||||||||||||||||||
Restructuring and acquisition related expenses (1) | |||||||||||||||||||||||
Restructuring expenses - cost of goods sold | ( | ||||||||||||||||||||||
Impairment of net assets held for sale and (gain) loss on disposal of businesses | ( | ||||||||||||||||||||||
Change in fair value of contingent consideration liabilities | ( | ( | |||||||||||||||||||||
Segment EBITDA | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Capital Expenditures | |||||||||||||||||||||||
North America | $ | $ | $ | $ | |||||||||||||||||||
Europe | |||||||||||||||||||||||
Specialty | |||||||||||||||||||||||
Total capital expenditures | $ | $ | $ | $ |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Receivables, net | |||||||||||
North America | $ | $ | |||||||||
Europe | |||||||||||
Specialty | |||||||||||
Total receivables, net | |||||||||||
Inventories | |||||||||||
North America | |||||||||||
Europe | |||||||||||
Specialty | |||||||||||
Total inventories | |||||||||||
Property, plant and equipment, net | |||||||||||
North America | |||||||||||
Europe | |||||||||||
Specialty | |||||||||||
Total property, plant and equipment, net | |||||||||||
Operating lease assets, net | |||||||||||
North America | |||||||||||
Europe | |||||||||||
Specialty | |||||||||||
Total operating lease assets, net | |||||||||||
Equity method investments | |||||||||||
North America | |||||||||||
Europe | |||||||||||
Total equity method investments | |||||||||||
Other unallocated assets | |||||||||||
Total assets | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Revenue | |||||||||||||||||||||||
United States | $ | $ | $ | $ | |||||||||||||||||||
United Kingdom | |||||||||||||||||||||||
Germany | |||||||||||||||||||||||
Other countries | |||||||||||||||||||||||
Total revenue | $ | $ | $ | $ |
September 30, | December 31, | ||||||||||
2021 | 2020 | ||||||||||
Long-lived assets | |||||||||||
United States | $ | $ | |||||||||
Germany | |||||||||||
United Kingdom | |||||||||||
Other countries | |||||||||||
Total long-lived assets | $ | $ |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Revenue | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||
Cost of goods sold | 59.2 | % | 60.7 | % | 59.1 | % | 60.5 | % | |||||||||||||||
Gross margin | 40.8 | % | 39.3 | % | 40.9 | % | 39.5 | % | |||||||||||||||
Selling, general and administrative expenses | 27.2 | % | 26.7 | % | 26.7 | % | 28.3 | % | |||||||||||||||
Restructuring and acquisition related expenses | 0.1 | % | 0.7 | % | 0.2 | % | 0.6 | % | |||||||||||||||
Impairment of net assets held for sale and (gain) loss on disposal of businesses | 0.0 | % | (0.0) | % | 0.0 | % | 0.0 | % | |||||||||||||||
Depreciation and amortization | 1.9 | % | 2.3 | % | 2.0 | % | 2.3 | % | |||||||||||||||
Operating income | 11.5 | % | 9.7 | % | 12.1 | % | 8.3 | % | |||||||||||||||
Total other expense, net | 0.4 | % | 0.9 | % | 0.7 | % | 0.9 | % | |||||||||||||||
Income from continuing operations before provision for income taxes | 11.1 | % | 8.8 | % | 11.4 | % | 7.4 | % | |||||||||||||||
Provision for income taxes | 2.7 | % | 2.6 | % | 2.9 | % | 2.1 | % | |||||||||||||||
Equity in earnings of unconsolidated subsidiaries | 0.2 | % | 0.1 | % | 0.2 | % | 0.0 | % | |||||||||||||||
Income from continuing operations | 8.6 | % | 6.4 | % | 8.6 | % | 5.3 | % | |||||||||||||||
Net loss from discontinued operations | — | % | — | % | — | % | (0.0) | % | |||||||||||||||
Net income | 8.6 | % | 6.4 | % | 8.6 | % | 5.3 | % | |||||||||||||||
Less: net (loss) income attributable to continuing noncontrolling interest | (0.0) | % | 0.0 | % | 0.0 | % | 0.0 | % | |||||||||||||||
Less: net income attributable to discontinued noncontrolling interest | — | % | — | % | — | % | 0.0 | % | |||||||||||||||
Net income attributable to LKQ stockholders | 8.6 | % | 6.3 | % | 8.6 | % | 5.3 | % | |||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Three Months Ended | |||||||||||||||||||||||||||||||||||
September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
2021 | 2020 | Organic | Acquisition and Divestiture | Foreign Exchange | Total Change | ||||||||||||||||||||||||||||||
Parts & services revenue | $ | 3,061,308 | $ | 2,885,729 | 4.0 | % | 0.5 | % | 1.5 | % | 6.1 | % | |||||||||||||||||||||||
Other revenue | 235,303 | 161,955 | 45.1 | % | 0.1 | % | 0.1 | % | 45.3 | % | |||||||||||||||||||||||||
Total revenue | $ | 3,296,611 | $ | 3,047,684 | 6.2 | % | 0.5 | % | 1.5 | % | 8.2 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Three Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2021 | 2020 | Change | |||||||||||||||
Restructuring expenses | $ | 1,843 | (1) | $ | 12,701 | (2) | $ | (10,858) | |||||||||
Acquisition related expenses | 682 | (3) | 7,794 | (4) | (7,112) | ||||||||||||
Restructuring and acquisition related expenses | $ | 2,525 | $ | 20,495 | $ | (17,970) |
Three Months Ended | ||||||||||||||||||||
September 30, | ||||||||||||||||||||
2021 | 2020 | Change | ||||||||||||||||||
Depreciation | $ | 38,555 | $ | 38,346 | $ | 209 | (1) | |||||||||||||
Amortization | 25,440 | 30,309 | (4,869) | (2) | ||||||||||||||||
Total depreciation and amortization | $ | 63,995 | $ | 68,655 | $ | (4,660) |
Other expense, net for the three months ended September 30, 2020 | $ | 27,674 | |||||||||
Increase (decrease) due to: | |||||||||||
Interest expense, net of interest income | (9,755) | (1) | |||||||||
Other (income) expense, net | (5,380) | (2) | |||||||||
Net decrease | (15,135) | ||||||||||
Other expense, net for the three months ended September 30, 2021 | $ | 12,539 |
Nine Months Ended | |||||||||||||||||||||||||||||||||||
September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
2021 | 2020 | Organic | Acquisition and Divestiture | Foreign Exchange | Total Change | ||||||||||||||||||||||||||||||
Parts & services revenue | $ | 9,171,345 | $ | 8,201,604 | 8.3 | % | (0.1) | % | 3.6 | % | 11.8 | % | |||||||||||||||||||||||
Other revenue | 731,166 | 473,338 | 54.1 | % | 0.0 | % | 0.3 | % | 54.5 | % | |||||||||||||||||||||||||
Total revenue | $ | 9,902,511 | $ | 8,674,942 | 10.8 | % | (0.1) | % | 3.5 | % | 14.2 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2021 | 2020 | Change | |||||||||||||||
Restructuring expenses | $ | 14,679 | (1) | $ | 44,498 | (2) | $ | (29,819) | |||||||||
Acquisition related expenses | 800 | (3) | 7,917 | (4) | (7,117) | ||||||||||||
Restructuring and acquisition related expenses | $ | 15,479 | $ | 52,415 | $ | (36,936) |
Nine Months Ended | ||||||||||||||||||||
September 30, | ||||||||||||||||||||
2021 | 2020 | Change | ||||||||||||||||||
Depreciation | $ | 116,280 | $ | 112,462 | $ | 3,818 | (1) | |||||||||||||
Amortization | 78,412 | 87,435 | (9,023) | (2) | ||||||||||||||||
Total depreciation and amortization | $ | 194,692 | $ | 199,897 | $ | (5,205) |
Other expense, net for the nine months ended September 30, 2020 | $ | 80,176 | |||||||||
Increase (decrease) due to: | |||||||||||
Interest expense, net of interest income | (20,951) | (1) | |||||||||
Loss on debt extinguishment | 10,813 | (2) | |||||||||
Other (income) expense, net | (4,108) | (3) | |||||||||
Net decrease | (14,246) | ||||||||||
Other expense, net for the nine months ended September 30, 2021 | $ | 65,930 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2021 | % of Total Segment Revenue | 2020 | % of Total Segment Revenue | 2021 | % of Total Segment Revenue | 2020 | % of Total Segment Revenue | ||||||||||||||||||||||||||||||||||||||||
Third Party Revenue | |||||||||||||||||||||||||||||||||||||||||||||||
North America | $ | 1,306,310 | $ | 1,164,031 | $ | 3,882,734 | $ | 3,465,102 | |||||||||||||||||||||||||||||||||||||||
Europe | 1,525,274 | 1,484,099 | 4,565,388 | 4,058,878 | |||||||||||||||||||||||||||||||||||||||||||
Specialty | 465,027 | 399,554 | 1,454,389 | 1,150,962 | |||||||||||||||||||||||||||||||||||||||||||
Total third party revenue | $ | 3,296,611 | $ | 3,047,684 | $ | 9,902,511 | $ | 8,674,942 | |||||||||||||||||||||||||||||||||||||||
Total Revenue | |||||||||||||||||||||||||||||||||||||||||||||||
North America | $ | 1,306,965 | $ | 1,164,241 | $ | 3,884,352 | $ | 3,465,831 | |||||||||||||||||||||||||||||||||||||||
Europe | 1,525,274 | 1,484,099 | 4,565,388 | 4,058,878 | |||||||||||||||||||||||||||||||||||||||||||
Specialty | 465,842 | 400,429 | 1,457,060 | 1,153,885 | |||||||||||||||||||||||||||||||||||||||||||
Eliminations | (1,470) | (1,085) | (4,289) | (3,652) | |||||||||||||||||||||||||||||||||||||||||||
Total revenue | $ | 3,296,611 | $ | 3,047,684 | $ | 9,902,511 | $ | 8,674,942 | |||||||||||||||||||||||||||||||||||||||
Segment EBITDA | |||||||||||||||||||||||||||||||||||||||||||||||
North America | $ | 225,582 | 17.3 | % | $ | 204,957 | 17.6 | % | $ | 750,935 | 19.3 | % | $ | 565,949 | 16.3 | % | |||||||||||||||||||||||||||||||
Europe | 175,093 | 11.5 | % | 136,165 | 9.2 | % | 484,157 | 10.6 | % | 303,814 | 7.5 | % | |||||||||||||||||||||||||||||||||||
Specialty | 51,644 | 11.1 | % | 48,340 | 12.1 | % | 192,525 | 13.2 | % | 132,805 | 11.5 | % |
Three Months Ended September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
North America | 2021 | 2020 | Organic | Acquisition and Divestiture | Foreign Exchange | Total Change | |||||||||||||||||||||||||||||
Parts & services revenue | $ | 1,076,599 | $ | 1,007,001 | 5.9 | % | (1) | 0.6 | % | 0.4 | % | 6.9 | % | ||||||||||||||||||||||
Other revenue | 229,711 | 157,030 | 46.1 | % | (2) | 0.1 | % | 0.0 | % | 46.3 | % | ||||||||||||||||||||||||
Total third party revenue | $ | 1,306,310 | $ | 1,164,031 | 11.3 | % | 0.6 | % | 0.3 | % | 12.2 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
North America | Percentage of Total Segment Revenue | ||||||||||
Segment EBITDA for the three months ended September 30, 2020 | 17.6 | % | |||||||||
Increase (decrease) due to: | |||||||||||
Change in gross margin | 0.5 | % | (1) | ||||||||
Change in segment operating expenses | (1.0) | % | (2) | ||||||||
Change in other expense, net and net income attributable to continuing noncontrolling interest | 0.1 | % | |||||||||
Segment EBITDA for the three months ended September 30, 2021 | 17.3 | % | |||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Three Months Ended September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
Europe | 2021 | 2020 | Organic (1) | Acquisition and Divestiture | Foreign Exchange (2) | Total Change | |||||||||||||||||||||||||||||
Parts & services revenue | $ | 1,519,682 | $ | 1,479,174 | 0.1 | % | (0.0) | % | 2.6 | % | 2.7 | % | |||||||||||||||||||||||
Other revenue | 5,592 | 4,925 | 10.9 | % | — | % | 2.6 | % | 13.6 | % | |||||||||||||||||||||||||
Total third party revenue | $ | 1,525,274 | $ | 1,484,099 | 0.2 | % | (0.0) | % | 2.6 | % | 2.8 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Europe | Percentage of Total Segment Revenue | ||||||||||
Segment EBITDA for the three months ended September 30, 2020 | 9.2 | % | |||||||||
Increase (decrease) due to: | |||||||||||
Change in gross margin | 2.5 | % | (1) | ||||||||
Change in segment operating expenses | (0.3) | % | (2) | ||||||||
Change in other expense, net and net income attributable to continuing noncontrolling interest | 0.2 | % | |||||||||
Segment EBITDA for the three months ended September 30, 2021 | 11.5 | % | |||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Three Months Ended September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
Specialty | 2021 | 2020 | Organic (1) | Acquisition and Divestiture | Foreign Exchange | Total Change | |||||||||||||||||||||||||||||
Parts & services revenue | $ | 465,027 | $ | 399,554 | 13.7 | % | 2.1 | % | 0.6 | % | 16.4 | % | |||||||||||||||||||||||
Other revenue | — | — | — | % | — | % | — | % | — | % | |||||||||||||||||||||||||
Total third party revenue | $ | 465,027 | $ | 399,554 | 13.7 | % | 2.1 | % | 0.6 | % | 16.4 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Specialty | Percentage of Total Segment Revenue | ||||||||||
Segment EBITDA for the three months ended September 30, 2020 | 12.1 | % | |||||||||
Increase (decrease) due to: | |||||||||||
Change in gross margin | (0.3) | % | (1) | ||||||||
Change in segment operating expenses | (0.6) | % | (2) | ||||||||
Segment EBITDA for the three months ended September 30, 2021 | 11.1 | % | |||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Nine Months Ended September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
North America | 2021 | 2020 | Organic | Acquisition and Divestiture | Foreign Exchange | Total Change | |||||||||||||||||||||||||||||
Parts & services revenue | $ | 3,172,207 | $ | 3,007,169 | 4.7 | % | (1) | 0.3 | % | 0.5 | % | 5.5 | % | ||||||||||||||||||||||
Other revenue | 710,527 | 457,933 | 55.1 | % | (2) | 0.0 | % | 0.0 | % | 55.2 | % | ||||||||||||||||||||||||
Total third party revenue | $ | 3,882,734 | $ | 3,465,102 | 11.4 | % | 0.3 | % | 0.4 | % | 12.1 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
North America | Percentage of Total Segment Revenue | ||||||||||
Segment EBITDA for the nine months ended September 30, 2020 | 16.3 | % | |||||||||
Increase (decrease) due to: | |||||||||||
Change in gross margin | 1.5 | % | (1) | ||||||||
Change in segment operating expenses | 1.6 | % | (2) | ||||||||
Change in other expense, net and net income attributable to continuing noncontrolling interest | (0.2) | % | |||||||||
Segment EBITDA for the nine months ended September 30, 2021 | 19.3 | % | |||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Nine Months Ended September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
Europe | 2021 | 2020 | Organic | Acquisition and Divestiture (2) | Foreign Exchange (3) | Total Change | |||||||||||||||||||||||||||||
Parts & services revenue | $ | 4,544,749 | $ | 4,043,473 | 6.3 | % | (1) | (0.7) | % | 6.8 | % | 12.4 | % | ||||||||||||||||||||||
Other revenue | 20,639 | 15,405 | 25.6 | % | — | % | 8.4 | % | 34.0 | % | |||||||||||||||||||||||||
Total third party revenue | $ | 4,565,388 | $ | 4,058,878 | 6.4 | % | (0.7) | % | 6.8 | % | 12.5 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Europe | Percentage of Total Segment Revenue | ||||||||||
Segment EBITDA for the nine months ended September 30, 2020 | 7.5 | % | |||||||||
Increase (decrease) due to: | |||||||||||
Change in gross margin | 1.7 | % | (1) | ||||||||
Change in segment operating expenses | 1.3 | % | (2) | ||||||||
Change in other expense, net and net income attributable to continuing noncontrolling interest | 0.1 | % | |||||||||
Segment EBITDA for the nine months ended September 30, 2021 | 10.6 | % | |||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Nine Months Ended September 30, | Percentage Change in Revenue | ||||||||||||||||||||||||||||||||||
Specialty | 2021 | 2020 | Organic (1) | Acquisition and Divestiture | Foreign Exchange | Total Change | |||||||||||||||||||||||||||||
Parts & services revenue | $ | 1,454,389 | $ | 1,150,962 | 24.6 | % | 1.0 | % | 0.7 | % | 26.4 | % | |||||||||||||||||||||||
Other revenue | — | — | — | % | — | % | — | % | — | % | |||||||||||||||||||||||||
Total third party revenue | $ | 1,454,389 | $ | 1,150,962 | 24.6 | % | 1.0 | % | 0.7 | % | 26.4 | % | |||||||||||||||||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
Specialty | Percentage of Total Segment Revenue | ||||||||||
Segment EBITDA for the nine months ended September 30, 2020 | 11.5 | % | |||||||||
Increase (decrease) due to: | |||||||||||
Change in gross margin | 1.2 | % | (1) | ||||||||
Change in segment operating expenses | 0.5 | % | (2) | ||||||||
Segment EBITDA for the nine months ended September 30, 2021 | 13.2 | % | |||||||||
Note: In the table above, the sum of the individual percentages may not equal the total due to rounding. |
September 30, 2021 | December 31, 2020 | September 30, 2020 | |||||||||||||||
Cash and cash equivalents | $ | 402,703 | $ | 312,154 | $ | 421,382 | |||||||||||
Total debt (1) | 2,398,502 | 2,896,676 | 3,133,465 | ||||||||||||||
Current maturities (2) | 37,117 | 58,810 | 97,584 | ||||||||||||||
Capacity under credit facilities (3) | 3,150,000 | 3,260,000 | 3,260,000 | ||||||||||||||
Availability under credit facilities (3) | 1,637,753 | 2,546,081 | 2,270,953 | ||||||||||||||
Total liquidity (cash and cash equivalents plus availability under credit facilities) | 2,040,456 | 2,858,235 | 2,692,335 |
Covenant Level | Ratio Achieved as of September 30, 2021 | ||||||||||
Maximum net leverage ratio | 4.25:1.00 | 1.1 | |||||||||
Minimum interest coverage ratio | 3.00:1.00 | 24.4 |
Three months ending December 31, 2021 (1): | $ | 23,508 | |||
Years ending December 31: | |||||
2022 | 17,657 | ||||
2023 | 10,658 | ||||
2024 | 2,030,283 | ||||
2025 | 9,663 | ||||
Thereafter | 306,733 | ||||
Total debt (2) | $ | 2,398,502 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | Change | 2021 | 2020 | Change | ||||||||||||||||||||||||||||||||||||
North America | $ | 276,000 | $ | 270,600 | $ | 5,400 | $ | 798,100 | $ | 760,600 | $ | 37,500 | (1) | ||||||||||||||||||||||||||||
Europe | 961,600 | 940,400 | 21,200 | 2,860,900 | 2,491,600 | 369,300 | (2) | ||||||||||||||||||||||||||||||||||
Specialty | 352,500 | 252,200 | 100,300 | 1,105,200 | 678,400 | 426,800 | (3) | ||||||||||||||||||||||||||||||||||
Total | $ | 1,590,100 | $ | 1,463,200 | $ | 126,900 | $ | 4,764,200 | $ | 3,930,600 | $ | 833,600 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||||||||||||||
2021 | 2020 | % Change | 2021 | 2020 | % Change | |||||||||||||||||||||||||||||||||
North America wholesale salvage cars and trucks | 61 | 57 | 7.0 | % | 174 | 165 | 5.5 | % | ||||||||||||||||||||||||||||||
Europe wholesale salvage cars and trucks | 6 | 6 | 0.0 | % | 19 | 18 | 5.6 | % | ||||||||||||||||||||||||||||||
Self service and "crush only" cars | 138 | 148 | (6.8) | % | 414 | 434 | (4.6) | % |
Net cash provided by operating activities for the nine months ended September 30, 2020 | $ | 1,135 | ||||||
Increase (decrease) due to: | ||||||||
Operating income | 476 | (1) | ||||||
Cash paid for taxes | (126) | (2) | ||||||
Cash paid for interest | 45 | (3) | ||||||
Working capital accounts: (4) | ||||||||
Receivables, net | (105) | |||||||
Inventories | (588) | |||||||
Accounts payable | 484 | |||||||
Other operating activities | 41 | (5) | ||||||
Net cash provided by operating activities for the nine months ended September 30, 2021 | $ | 1,362 |
Nine Months Ended | |||||||||||
September 30, | |||||||||||
2021 | 2020 | ||||||||||
Net cash provided by operating activities | $ | 1,362,028 | $ | 1,134,641 | |||||||
Less: purchases of property, plant and equipment | 132,705 | 109,949 | |||||||||
Free cash flow | $ | 1,229,323 | $ | 1,024,692 |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | ||||||||||||||||||||||
July 1, 2021 - July 31, 2021 | 2,501 | $ | 50.18 | 2,501 | $ | 1,044,737 | ||||||||||||||||||||
August 1, 2021 - August 31, 2021 | 190 | $ | 51.03 | 190 | $ | 1,035,028 | ||||||||||||||||||||
September 1, 2021 - September 30, 2021 | 1,647 | $ | 50.92 | 1,647 | $ | 951,191 | ||||||||||||||||||||
Total | 4,338 | 4,338 | ||||||||||||||||||||||||
Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or Rule 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||
101.INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | ||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document | ||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | ||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
LKQ CORPORATION | |||||
/s/ Varun Laroyia | |||||
Varun Laroyia | |||||
Executive Vice President and Chief Financial Officer | |||||
(As duly authorized officer and Principal Financial Officer) | |||||
/s/ Michael S. Clark | |||||
Michael S. Clark | |||||
Vice President - Finance and Controller | |||||
(As duly authorized officer and Principal Accounting Officer) |
/s/ DOMINICK ZARCONE | |||||
Dominick Zarcone | |||||
President and Chief Executive Officer |
/S/ VARUN LAROYIA | |||||
Varun Laroyia | |||||
Executive Vice President and Chief Financial Officer |
/S/ DOMINICK ZARCONE | |||||
Dominick Zarcone | |||||
President and Chief Executive Officer |
/S/ VARUN LAROYIA | |||||
Varun Laroyia | |||||
Executive Vice President and Chief Financial Officer |
Consolidated Balance Sheets (Parenthetical) - $ / shares |
Sep. 30, 2021 |
Dec. 31, 2020 |
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Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 321,553,252 | 320,867,602 |
Common stock, shares outstanding | 292,243,742 | 303,553,000 |
Treasury Stock, Common, Shares | 29,309,510 | 17,314,602 |
Interim Financial Statements |
9 Months Ended |
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Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business | Interim Financial Statements The accompanying unaudited condensed consolidated financial statements represent the consolidation of LKQ Corporation, a Delaware corporation, and its subsidiaries. LKQ Corporation is a holding company and all operations are conducted by subsidiaries. When the terms "LKQ," "the Company," "we," "us," or "our" are used in this document, those terms refer to LKQ Corporation and its consolidated subsidiaries. We have prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") applicable to interim financial statements. Accordingly, certain information related to our significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted. These unaudited condensed consolidated financial statements reflect, in the opinion of management, all material adjustments (which include only normally recurring adjustments) necessary to fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented. Results for interim periods are not necessarily indicative of the results that can be expected for any subsequent interim period or for a full year. These interim financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 26, 2021 ("2020 Form 10-K"). The coronavirus disease 2019 ("COVID-19") pandemic and the resulting governmental actions taken to control the virus have impacted, and are expected to continue to impact, our business in 2020 and 2021. The effects include, but are not limited to, a reduction in demand for our products and services relative to 2019, liquidity challenges for certain of our customers and suppliers, and organizational changes, such as personnel reductions and route consolidation undertaken mostly in 2020, driven by cost actions to mitigate the revenue decline. We have considered COVID-19 impacts in the preparation of our financial statements and footnotes. Specific disclosures are presented in the following footnotes as applicable. The continuing impact of COVID-19 on our business, results of operations, financial condition and cash flows is dependent on future developments, including the severity and duration of the pandemic and the related impact on the global economy, which are uncertain and cannot be predicted at this time, but may be material.
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Discontinued Operations and Disposal Groups |
9 Months Ended |
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Sep. 30, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | Discontinued OperationsOn May 30, 2018, we acquired Stahlgruber GmbH ("Stahlgruber"), a leading European wholesale distributor of aftermarket spare parts for passenger cars, tools, capital equipment and accessories with operations in Germany, Austria, Italy, Slovenia, and Croatia, with further sales to Switzerland. Prior to closing, on May 3, 2018, the European Commission cleared the acquisition of Stahlgruber for the entire European Union, except with respect to the wholesale automotive parts business in the Czech Republic. The acquisition of Stahlgruber’s Czech Republic wholesale business was referred to the Czech Republic competition authority for review. On May 10, 2019, the Czech Republic competition authority approved our acquisition of Stahlgruber’s Czech Republic wholesale business subject to the requirement that we divest certain of the acquired locations. We acquired Stahlgruber’s Czech Republic wholesale business on May 29, 2019 and decided to divest all of the acquired locations. We immediately classified the business as discontinued operations because the business was never integrated into our Europe segment.We completed the sale of Stahlgruber's Czech Republic business on February 28, 2020, resulting in an immaterial loss on sale (presented in Net loss from discontinued operations in the Unaudited Condensed Consolidated Statements of Income). As part of the transaction, we purchased the 48.2% noncontrolling interest from the minority shareholder for a purchase price of €8 million, which included the issuance of €4 million of notes payable, and then immediately thereafter sold 100% of the business for a purchase price of €14 million, which included €7 million of notes receivable. This transaction resulted in a disposition of noncontrolling interest of $11 million. From January 1, 2020 through the date of sale, we recorded an immaterial amount of net income (excluding the loss on sale) from discontinued operations related to the business, of which an immaterial amount was attributable to the noncontrolling interest. |
Financial Statement Information (Notes) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Statement Information [Text Block] | Financial Statement Information Allowance for Credit Losses Receivables, net are reported net of an allowance for credit losses. Management evaluates the aging of customer receivable balances, the financial condition of our customers, historical trends, and macroeconomic factors to estimate the amount of customer receivables that may not be collected in the future and records a provision it believes is appropriate. Our reserve for expected lifetime credit losses was $63 million and $70 million as of September 30, 2021 and December 31, 2020, respectively. Bad debt expense totaled $3 million and $23 million for the nine months ended September 30, 2021 and 2020, respectively. Inventories Inventories consist of the following (in thousands):
Aftermarket and refurbished products and salvage and remanufactured products are primarily composed of finished goods. As of September 30, 2021, manufactured products inventory was composed of $24 million of raw materials, $5 million of work in process, and $1 million of finished goods. As of December 31, 2020, manufactured products inventory was composed of $16 million of raw materials, $3 million of work in process, and $2 million of finished goods. Intangible Assets Goodwill and indefinite-lived intangible assets are tested for impairment at least annually. We performed our annual impairment test during the fourth quarter of 2020, and we determined no impairment existed as all of our reporting units had a fair value estimate which exceeded the carrying value by at least 30%. The fair value estimates of our reporting units were established using weightings of the results of a discounted cash flow methodology and a comparative market multiples approach. Goodwill impairment testing may also be performed on an interim basis when events or circumstances arise that may lead to impairment. We did not identify a triggering event in 2021 that necessitated an interim test of goodwill impairment or indefinite-lived intangible assets impairment. Investments in Unconsolidated Subsidiaries Our investment in unconsolidated subsidiaries was $178 million and $155 million as of September 30, 2021 and December 31, 2020, respectively. Europe Segment Our investment in unconsolidated subsidiaries in Europe was $155 million and $137 million as of September 30, 2021 and December 31, 2020, respectively. We recorded equity in earnings of $4 million and $13 million during the three and nine months ended September 30, 2021, respectively, and equity in earnings of $4 million and $5 million during the three and nine months ended September 30, 2020, respectively, mainly related to our investment in Mekonomen AB ("Mekonomen"). We are accounting for our 26.6% equity interest in Mekonomen using the equity method of accounting, as our investment gives us the ability to exercise significant influence, but not control, over the investee. As of September 30, 2021, our share of the book value of Mekonomen's net assets exceeded the book value of our investment in Mekonomen by $8 million; this difference is primarily related to Mekonomen's Accumulated Other Comprehensive Income balance as of our acquisition date in 2016. We are recording our equity in the net earnings of Mekonomen on a one quarter lag. Mekonomen announced in March 2020 and February 2021, respectively, that the Mekonomen Board of Directors proposed no dividend payment in 2020 or 2021. The Level 1 fair value of our equity investment in the publicly traded Mekonomen common stock at September 30, 2021 was $271 million (using the Mekonomen share price of SEK 156 as of September 30, 2021) compared to a carrying value of $144 million. North America Segment Our investment in unconsolidated subsidiaries in the North America segment was $24 million and $19 million as of September 30, 2021 and December 31, 2020, respectively. We recorded equity in earnings of $3 million and $4 million during the three and nine months ended September 30, 2021, respectively, and equity in earnings of an immaterial amount and equity in losses of $3 million during the three and nine months ended September 30, 2020, respectively, related to our North America equity method investments. Warranty Reserve Some of our salvage mechanical products are sold with a standard six month warranty against defects. Additionally, some of our remanufactured engines are sold with a standard three or four year warranty against defects. We also provide a limited lifetime warranty for certain of our aftermarket products. These assurance-type warranties are not considered a separate performance obligation, and thus no transaction price is allocated to them. We record the warranty costs in Cost of goods sold in our Unaudited Condensed Consolidated Statements of Income. Our warranty reserve is calculated using historical claim information to project future warranty claims activity and is recorded within Other accrued expenses and Other noncurrent liabilities on our Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the related payments. The changes in the warranty reserve are as follows (in thousands):
Litigation and Related Contingencies We have certain contingencies resulting from litigation, claims and other commitments and are subject to a variety of environmental and pollution control laws and regulations incident to the ordinary course of business. We currently expect that the resolution of such contingencies will not materially affect our financial position, results of operations or cash flows. Government Assistance During the three and nine months ended September 30, 2021 and 2020, we recorded financial assistance from foreign governments, primarily in the form of grants, as credits in the following amounts (in thousands):
For the nine months ended September 30, 2021 and 2020, we received grants from European governments of $11 million and $38 million, respectively, with the remaining amounts related to Canada. Financial assistance received from governments is recorded during the period in which we incur the costs that the assistance is intended to offset (and only if it is probable that we will meet the conditions required under the terms of the assistance). Leases - Cash Flow Disclosure The amount disclosed for Leased assets obtained in exchange for operating lease liabilities for the nine months ended September 30, 2020 in the supplemental disclosure of noncash investing and financing activities in the Unaudited Condensed Consolidated Statements of Cash Flows includes an immaterial correction of $81 million to address an omission of the impact of lease modifications and terminations. Stockholders' Equity Treasury Stock As of June 30, 2021, our Board of Directors had authorized a stock repurchase program under which we were able to purchase up to $1.0 billion of our common stock from time to time through October 25, 2022. On July 28, 2021, our Board of Directors authorized a $1.0 billion increase and a two year extension to our stock repurchase program, raising the aggregate authorization under the program to $2.0 billion and authorizing repurchases through October 25, 2024. Repurchases under the program may be made in the open market or in privately negotiated transactions, with the amount and timing of repurchases depending on market conditions and corporate needs. The repurchase program does not obligate us to acquire any specific number of shares and may be suspended or discontinued at any time. Repurchased shares are accounted for as treasury stock using the cost method. During the three and nine months ended September 30, 2021, we repurchased 4.3 million and 12.0 million shares of common stock, respectively, for an aggregate price of $219 million and $580 million, respectively. During the nine months ended September 30, 2020, we repurchased 3.3 million shares of common stock for an aggregate price of $88 million; we did not repurchase any shares during the three months ended September 30, 2020. As of September 30, 2021, there was $951 million of remaining capacity under our repurchase program. Noncontrolling Interest In February 2020, as part of the sale of Stahlgruber's Czech Republic business, we divested the noncontrolling interest of the business, which resulted in a net decrease to Noncontrolling interest of $11 million in our unaudited condensed consolidated financial statements as of March 31, 2020. See Note 2, "Discontinued Operations," for further information. In December 2019, we modified the shares of a noncontrolling interest of a subsidiary acquired in connection with the Stahlgruber acquisition and issued new redeemable shares to the minority shareholder. The new redeemable shares contain (i) a put option for all noncontrolling interest shares at a fixed price of $24 million (€21 million) for the minority shareholder exercisable in the fourth quarter of 2023, (ii) a call option for all noncontrolling interest shares at a fixed price of $26 million (€23 million) for the Company exercisable beginning in the first quarter of 2026 through the end of the fourth quarter of 2027, and (iii) a guaranteed dividend to be paid quarterly to the minority shareholder through the fourth quarter of 2023. The new redeemable shares do not provide the minority shareholder with rights to participate in the profits and losses of the subsidiary prior to the exercise date of the put option. As the put option is outside the control of the Company, we recorded a $24 million Redeemable noncontrolling interest at the put option's redemption value outside of permanent equity on our Unaudited Condensed Consolidated Balance Sheets. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In the first quarter of 2021, we adopted ASU No. 2019-12, "Income Taxes" (Topic 740) ("ASU 2019-12"), which simplifies the accounting for income taxes and adds guidance to reduce complexity in certain areas. We adopted the standard in the first quarter using the prospective approach. The adoption of this accounting standard did not have a material impact on our unaudited condensed consolidated financial statements. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" ("ASU 2020-04"), which provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. ASU 2020-04 provides optional expedients and exceptions for applying generally accepted accounting principles to transactions affected by reference rate reform if certain criteria are met. These transactions include contract modifications, hedging relationships, and sale or transfer of debt securities classified as held-to-maturity. Entities may apply the provisions of the new standard as of the beginning of the reporting period when the election is made (i.e., as early as the first quarter of 2020). Unlike other topics, the provisions of this update are only available until December 31, 2022. We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures, and we have not yet elected an adoption date.
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Goodwill and Intangible Assets Disclosure | Intangible AssetsGoodwill and indefinite-lived intangible assets are tested for impairment at least annually. We performed our annual impairment test during the fourth quarter of 2020, and we determined no impairment existed as all of our reporting units had a fair value estimate which exceeded the carrying value by at least 30%. The fair value estimates of our reporting units were established using weightings of the results of a discounted cash flow methodology and a comparative market multiples approach. Goodwill impairment testing may also be performed on an interim basis when events or circumstances arise that may lead to impairment. We did not identify a triggering event in 2021 that necessitated an interim test of goodwill impairment or indefinite-lived intangible assets impairment. |
Revenue Recognition Revenue Reconition (Notes) |
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Revenue From Contract With Customer | Revenue Recognition The majority of our revenue is derived from the sale of vehicle parts. We recognize revenue when the products are shipped to, delivered to or picked up by customers, which is the point when title has transferred and risk of ownership has passed. Sources of Revenue We report our revenue in two categories: (i) parts and services and (ii) other. The following table sets forth our revenue by category, with our parts and services revenue further disaggregated by reportable segment (in thousands):
Parts and Services Our parts revenue is generated from the sale of vehicle products including replacement parts, components and systems used in the repair and maintenance of vehicles and specialty products and accessories to improve the performance, functionality and appearance of vehicles. Services revenue includes (i) additional services that are generally billed concurrently with the related product sales, such as the sale of service-type warranties, (ii) fees for admission to our self service yards, and (iii) diagnostic and repair services. In North America, our vehicle replacement products include sheet metal collision parts such as doors, hoods, and fenders; bumper covers; head and tail lamps; automotive glass products such as windshields; mirrors and grilles; wheels; and large mechanical items such as engines and transmissions. In Europe, our products include a wide variety of small mechanical products such as brake pads, discs and sensors; clutches; electrical products such as spark plugs and batteries; steering and suspension products; filters; and oil and automotive fluids. In our Specialty operations, we serve six product segments: truck and off-road; speed and performance; recreational vehicles; towing; wheels, tires and performance handling; and miscellaneous accessories. Our service-type warranties typically have service periods ranging from 6 months to 36 months. Proceeds from these service-type warranties are deferred at contract inception and amortized on a straight-line basis to revenue over the contract period. The changes in deferred service-type warranty revenue are as follows (in thousands):
Other Revenue Revenue from other sources includes sales of scrap and precious metals (platinum, palladium, and rhodium), bulk sales to mechanical manufacturers (including cores) and sales of aluminum ingots and sows from our furnace operations. We derive scrap metal and other precious metals from several sources, including vehicles that have been used in both our wholesale and self service recycling operations and from original equipment manufacturers ("OEMs") and other entities that contract with us for secure disposal of "crush only" vehicles. Revenue from the sale of hulks in our wholesale and self service recycling operations is recognized based on a price per ton of delivered material when the customer (processor) collects the scrap. Some adjustments may occur when the customer weighs the scrap at their location, and revenue is adjusted accordingly. Revenue by Geographic Area See Note 14, "Segment and Geographic Information" for information related to our revenue by geographic region. Variable Consideration The amount of revenue ultimately received from the customer can vary due to variable consideration including returns, discounts, rebates, refunds, credits, price concessions, incentives, performance bonuses, or other similar items. Under FASB Accounting Standards Codification Topic 606 ("ASC 606"), we are required to select the “expected value method” or the “most likely amount” method in order to estimate variable consideration. We utilize both methods in practice depending on the type of variable consideration, with contemplation of any expected reversals in revenue. We recorded a refund liability and return asset for expected returns of $108 million and $59 million, respectively, as of September 30, 2021, and $102 million and $57 million, respectively, as of December 31, 2020. The refund liability is presented separately on the Unaudited Condensed Consolidated Balance Sheets within current liabilities while the return asset is presented within Prepaid expenses and other current assets. Other types of variable consideration consist primarily of discounts, volume rebates, and other customer sales incentives that are recorded in Receivables, net on the Unaudited Condensed Consolidated Balance Sheets. We recorded a reserve for our variable consideration of $131 million and $127 million as of September 30, 2021 and December 31, 2020, respectively. While other customer incentive programs exist, we characterize them as material rights in the context of our sales transactions. We consider these programs to be immaterial to our unaudited condensed consolidated financial statements.
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Restructuring and Acquisition Related Expenses (Notes) |
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Sep. 30, 2021 | |
Restructuring and Acquisition Related Expenses [Abstract] | |
Business Acquisition, Integration, Restructuring and Other Related Costs [Text Block] | Restructuring and Acquisition Related Expenses 2019 Global Restructuring Program In the second quarter of 2019, we commenced a cost reduction initiative, covering all three of our reportable segments, designed to eliminate underperforming assets and cost inefficiencies. We have incurred and expect to incur costs for inventory write-downs; employee severance and other expenditures related to employee terminations; lease exit costs, such as lease termination fees, accelerated amortization of operating lease assets and impairment of operating lease assets; other costs related to facility exits, such as moving expenses to relocate inventory and equipment; and accelerated depreciation of fixed assets to be disposed of earlier than the end of the previously estimated useful lives. During the three and nine months ended September 30, 2020, we incurred $1 million and $6 million, respectively, of restructuring expenses under this program, primarily related to facility exit costs and employee-related costs in our Europe and North America segments. The actions under this program are substantially complete, and the expenses incurred during the three and nine months ended September 30, 2021 were immaterial. The total cumulative program costs incurred to date were $47 million, of which $31 million, $14 million and $1 million were in our Europe, North America and Specialty segments, respectively. As of September 30, 2021, the remaining expected costs and restructuring liabilities related to this program were immaterial. 2020 Global Restructuring Program Beginning in the first quarter of 2020, we initiated a further restructuring program aimed at cost reductions across all our reportable segments through the elimination of underperforming assets and cost inefficiencies. These actions are incremental to those initiated as part of the 2019 Global Restructuring Program, and include costs for inventory write-downs; employee severance and other expenditures related to employee terminations; lease exit costs, such as lease termination fees, accelerated amortization of operating lease assets and impairment of operating lease assets; other costs related to facility exits, such as moving expenses to relocate inventory and equipment; and accelerated depreciation of fixed assets to be disposed of earlier than the end of the previously estimated useful lives. We expanded this program during the second and third quarters of 2020 as we identified additional opportunities to eliminate inefficiencies, including actions in response to impacts to our business from COVID-19. During the three and nine months ended September 30, 2021, we recognized restructuring expenses of $1 million and $7 million, respectively, which included employee-related costs, facility exit costs, and a $3 million gain in the first quarter from the sale of a building to be closed as part of the restructuring plan. During the three and nine months ended September 30, 2020, we recognized restructuring expenses totaling $10 million and $38 million, respectively, for employee-related costs, facility exit costs and inventory write-downs. Of the cumulative program costs incurred to date, $29 million, $26 million and $1 million related to our North America, Europe and Specialty segments, respectively. We estimate total costs under the program through its expected completion date in 2023 will be between $60 million and $70 million, of which approximately $33 million, $32 million, and $1 million will be incurred by our Europe, North America and Specialty segments, respectively; these segment amounts represent the midpoints of the expected ranges of costs to be incurred by each segment. As of September 30, 2021 and December 31, 2020, restructuring liabilities incurred related to this program totaled $13 million and $21 million, respectively, including $10 million and $17 million, respectively, related to leases we have exited or expect to exit prior to the end of the lease term (reported in Current portion of operating lease liabilities and Long-term operating lease liabilities, excluding current portion on our Unaudited Condensed Consolidated Balance Sheets), and $2 million and $4 million, respectively, for employee termination costs (reported in Accrued payroll-related liabilities on our Unaudited Condensed Consolidated Balance Sheets). Our lease-related restructuring liabilities are estimated based on remaining rent payments after our actual exit date for facilities closed through the third quarter of 2021 and after our planned exit date for facilities we expect to close in future periods; these liabilities do not reflect any estimated proceeds we may be able to achieve through subleasing the facilities. Acquisition Integration Plans During the three and nine months ended September 30, 2021, we incurred immaterial restructuring expenses for our acquisition integration plans. We expect to incur future expenses of up to $5 million to complete an integration plan related to acquisitions completed in our Specialty segment during the nine months ended September 30, 2021. During the three and nine months ended September 30, 2020, we incurred $2 million and $8 million of restructuring expenses, respectively, for our acquisition integration plans. These expenses were primarily related to the integration of our operations in Belgium. 1 LKQ Europe Program In September 2019, we announced a multi-year program called "1 LKQ Europe" which is intended to create structural centralization and standardization of key functions to facilitate the operation of the Europe segment as a single business. Under the 1 LKQ Europe program, we will reorganize our non-customer-facing teams and support systems through various projects including the implementation of a common ERP platform, rationalization of our product portfolio, and creation of a Europe headquarters office and central back office. While certain projects were delayed in 2020 as a result of the COVID-19 pandemic, such as our procurement initiatives and the new headquarters in Switzerland, we also accelerated certain projects, such as the integration of previously acquired networks and sharing resources across LKQ Europe. We completed the organizational design and implementation projects in June 2021, with the remaining projects scheduled to be completed by 2024. During the nine months ended September 30, 2021, we incurred $6 million of employee-related restructuring charges under our 1 LKQ Europe program; costs incurred in the three months ended September 30, 2021 were immaterial. We estimate that we will incur between $40 million and $50 million in total personnel and inventory-related restructuring charges through 2024 under the program. We may identify additional initiatives and projects under the 1 LKQ Europe program in future periods that may result in additional restructuring expense, although we are currently unable to estimate the range of charges for such potential future initiatives and projects. As of September 30, 2021, the restructuring liabilities related to this program were immaterial. Acquisition Related Expenses We incurred immaterial acquisition related expenses in each of the three and nine months ended September 30, 2021. These expenses included external costs such as legal, accounting and advisory fees related to completed and potential transactions. During the three and nine months ended September 30, 2020, we incurred $8 million of acquisition related expenses, primarily related to the resolution of a purchase price matter related to the Stahlgruber transaction for an amount above our prior estimate.
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Equity Incentive Plans |
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Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Incentive Plans | Stock-Based Compensation In order to attract and retain employees, non-employee directors, consultants, and other persons associated with us, we grant equity-based awards under the LKQ Corporation 1998 Equity Incentive Plan (the “Equity Incentive Plan”). We have granted restricted stock units ("RSUs"), stock options, and restricted stock under the Equity Incentive Plan. We expect to issue new or treasury shares of common stock to cover past and future equity grants. RSUs The RSUs we have issued vest over periods of up to five years, subject to a continued service condition. Currently outstanding RSUs (other than PSUs, which are described below) contain either a time-based vesting condition or a combination of a performance-based vesting condition and a time-based vesting condition, in which case both conditions must be met before any RSUs vest. For all of the RSUs containing a performance-based vesting condition, the Company must report positive diluted earnings per share, subject to certain adjustments, during any fiscal year period within five years following the grant date. Each RSU converts into one share of LKQ common stock on the applicable vesting date. The grant date fair value of RSUs is based on the market price of LKQ stock on the grant date. Starting with our 2019 grants, participants who are eligible for retirement (defined as a voluntary separation of service from the Company after the participant has attained at least 60 years of age and completed at least five years of service) will continue to vest in their awards following retirement; if retirement occurs during the first year of the vesting period (for RSUs subject to a time-based vesting condition) or the first year of the performance period (for RSUs with a performance-based vesting condition), the participant vests in a prorated amount of the RSU grant based on the portion of the year employed. For our RSU grants prior to 2019, participants forfeit their unvested shares upon retirement. Outstanding unvested RSUs earn dividend equivalents at the same rate as dividends on the Company’s common stock. The dividend equivalents are subject to the same vesting requirements, restrictions and forfeiture provisions as the original award. The fair value of RSUs that vested during the nine months ended September 30, 2021 was $34 million; the fair value of RSUs vested is based on the market price of LKQ stock on the date vested. The following table summarizes activity related to our RSUs under the Equity Incentive Plan for the nine months ended September 30, 2021:
(1) The aggregate intrinsic value of expected to vest RSUs represents the total pretax intrinsic value (the fair value of the Company's stock on the last day of each period multiplied by the number of units) that would have been received by the holders had all the expected to vest RSUs vested. This amount changes based on the market price of the Company’s common stock. (2) The weighted average grant date fair value of RSUs granted during the nine months ended September 30, 2020 was $31.67. Starting in 2019, we granted performance-based three-year RSUs ("PSUs") to certain employees, including our executive officers, under our Equity Incentive Plan. As these awards are performance-based, the exact number of shares to be paid out may be up to twice the grant amount, depending on the Company's performance and the achievement of certain performance metrics (adjusted earnings per share, average organic parts and services revenue growth, and average return on invested capital) over the applicable three year performance periods. Outstanding unvested PSUs earn dividend equivalents at the same rate as dividends on the Company’s common stock. The dividend equivalents are subject to the same vesting requirements, restrictions and forfeiture provisions as the original award. The following table summarizes activity related to our PSUs under the Equity Incentive Plan for the nine months ended September 30, 2021:
(1) The aggregate intrinsic value of expected to vest PSUs represents the total pretax intrinsic value (the fair value of the Company's stock on the last day of each period multiplied by the number of units at target) that would have been received by the holders had all the expected to vest PSUs vested. This amount changes based on the market price of the Company’s common stock and the achievement of the performance metrics relative to the established targets. (2) Represents the number of PSUs at target payout. The weighted average grant date fair value of PSUs granted during the nine months ended September 30, 2020 was $31.85. Stock-Based Compensation Expense Pre-tax stock-based compensation expense for RSUs and PSUs totaled $8 million and $25 million for the three and nine months ended September 30, 2021, respectively, and $7 million and $23 million for the three and nine months ended September 30, 2020, respectively. As of September 30, 2021, unrecognized compensation expense related to unvested RSUs and PSUs was $50 million. Stock-based compensation expense related to these awards will be different to the extent that forfeitures are realized and performance under the PSUs differs from target.
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Earnings Per Share Earnings Per Share (Notes) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Text Block] | Earnings Per Share The following chart sets forth the computation of earnings per share (in thousands, except per share amounts):
(1) Diluted earnings per share from continuing operations was computed using the treasury stock method for dilutive securities. The following table sets forth the number of employee stock-based compensation awards outstanding but not included in the computation of diluted earnings per share because their effect would have been antidilutive for the three and nine months ended September 30, 2021 and 2020 (in thousands):
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Accumulated Other Comprehensive Income (Loss) |
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Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income (Loss) Note [Text Block] | Accumulated Other Comprehensive Income (Loss) The components of Accumulated Other Comprehensive Income (Loss) are as follows (in thousands):
Net unrealized losses and gains related to our pension plans were reclassified to Other (income) expense, net in our Unaudited Condensed Consolidated Statements of Income during each of the three and nine months ended September 30, 2021 and 2020. Our policy is to reclassify the income tax effect from Accumulated other comprehensive loss to the Provision for income taxes when the related gains and losses are released to the Unaudited Condensed Consolidated Statements of Income. The amounts of unrealized gains and losses on our Cash Flow Hedges reclassified to our Unaudited Condensed Consolidated Statements of Income are as follows (in thousands):
(1)The amounts reclassified to Other (income) expense, net in our Unaudited Condensed Consolidated Statements of Income offset the impact of the remeasurement of the underlying transactions.
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Accumulated Other Comprehensive Income (Loss) | The components of Accumulated Other Comprehensive Income (Loss) are as follows (in thousands):
Net unrealized losses and gains related to our pension plans were reclassified to Other (income) expense, net in our Unaudited Condensed Consolidated Statements of Income during each of the three and nine months ended September 30, 2021 and 2020. Our policy is to reclassify the income tax effect from Accumulated other comprehensive loss to the Provision for income taxes when the related gains and losses are released to the Unaudited Condensed Consolidated Statements of Income.
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Long-Term Obligations |
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Long-Term Obligations | Long-Term Obligations Long-term obligations consist of the following (in thousands):
Senior Secured Credit Agreement On June 11, 2020, LKQ Corporation and certain other subsidiaries of LKQ (collectively, the "Borrowers") entered into Amendment No. 4 to the Fourth Amended and Restated Credit Agreement dated January 29, 2016 (the "Credit Agreement"), which modified the maximum permitted net leverage ratio through the quarter ended September 30, 2021. Prior to the amendment, the maximum permitted net leverage ratio was 4.00:1.00. After the amendment, the maximum permitted net leverage ratio became 4.25:1.00 for the quarter ended September 30, 2021. Beginning with the quarter ending December 31, 2021, the maximum permitted net leverage ratio reverts to the terms in effect prior to the amendment. In the event that the net leverage ratio is greater than 4.00:1.00, the Company would be restricted from repurchasing its shares. We can at any time elect to cancel the modifications to the maximum permitted net leverage ratio and revert to the terms in effect prior to the amendment, subject to compliance with the 4.00:1.00 ratio. Amendment No. 4 to the Credit Agreement also made certain other immaterial modifications. On December 14, 2020, we entered into Amendment No. 5 to the Credit Agreement; the amendment added as a borrower our subsidiary LKQ Europe GmbH, a Swiss limited liability company, and made certain other immaterial or clarifying modifications. The total availability under the revolving credit facility's multicurrency component is $3.15 billion. Amounts outstanding under the revolving credit facility are due and payable upon maturity of the Credit Agreement on January 29, 2024. We were required to prepay the term loan by amounts equal to proceeds from the sale or disposition of certain assets if the proceeds were not reinvested within twelve months. We also had the option to prepay outstanding amounts under the Credit Agreement without penalty. During the second quarter, we exercised this option to prepay the outstanding amount on the term loan, and thus we did not have any term loan borrowings as of September 30, 2021. The Credit Agreement contains customary representations and warranties and customary covenants that provide limitations and conditions on our ability to enter into certain transactions. The Credit Agreement also contains financial and affirmative covenants, including limitations on our net leverage ratio and a minimum interest coverage ratio. Borrowings under the Credit Agreement bear interest at variable rates, which depend on the currency and duration of the borrowing elected, plus an applicable margin. The applicable margin is subject to change in increments of 0.25% depending on our net leverage ratio. Interest payments are due on the last day of the selected interest period or quarterly in arrears depending on the type of borrowing. Including the effect of the interest rate swap agreements described in Note 10, "Derivative Instruments and Hedging Activities," the weighted average interest rates on borrowings outstanding under the Credit Agreement at September 30, 2021 and December 31, 2020 were 1.1% and 1.7%, respectively. We also pay a commitment fee based on the average daily unused amount of the revolving credit facilities. The commitment fee is subject to change in increments of 0.05% depending on our net leverage ratio. In addition, we pay a participation commission on outstanding letters of credit at an applicable rate based on our net leverage ratio, and a fronting fee of 0.125% to the issuing bank, which are due quarterly in arrears. Of the total borrowings outstanding under the Credit Agreement, there were no current maturities as of September 30, 2021 and $18 million classified as current maturities as of December 31, 2020. As of September 30, 2021, there were letters of credit outstanding in the aggregate amount of $69 million. The amounts available under the revolving credit facilities are reduced by the amounts outstanding under letters of credit, and thus availability under the revolving credit facilities at September 30, 2021 was $1.6 billion. Related to the execution of Amendment No. 4 to the Fourth Amended and Restated Credit Agreement in June 2020, we incurred $4 million of fees, the majority of which were capitalized as an offset to Long-Term Obligations and are amortized over the term of the agreement. U.S. Notes (2023) On January 10, 2020, we redeemed the $600 million aggregate principal amount of 4.75% senior notes due 2023 (the "U.S Notes (2023)") at a redemption price equal to 101.583% of the principal amount of the U.S. Notes (2023) plus accrued and unpaid interest thereon to, but not including, January 10, 2020. The total redemption payment was $614 million, including an early-redemption premium of $9 million and accrued and unpaid interest of $4 million. In the first quarter of 2020, we recorded a loss on debt extinguishment of $13 million on the Unaudited Condensed Consolidated Statements of Income related to the redemption due to the early-redemption premium and the write-off of the unamortized debt issuance costs. Euro Notes (2024) On April 14, 2016, LKQ Italia Bondco S.p.A. ("LKQ Italia"), an indirect, wholly-owned subsidiary of LKQ Corporation, completed an offering of €500 million aggregate principal amount of senior notes due April 1, 2024 (the "Euro Notes (2024)") in a private placement conducted pursuant to Regulation S and Rule 144A under the Securities Act of 1933. The proceeds from the offering were used to repay a portion of the revolver borrowings under the Credit Agreement and to pay related fees and expenses. The Euro Notes (2024) are governed by the Indenture dated as of April 14, 2016 (the "Euro Notes (2024) Indenture") among LKQ Italia, LKQ Corporation and certain of our subsidiaries (the "Euro Notes (2024) Subsidiaries"), the trustee, and the paying agent, transfer agent, and registrar. The Euro Notes (2024) bear interest at a rate of 3.875% per year from the date of original issuance or from the most recent payment date on which interest has been paid or provided for. Interest on the Euro Notes (2024) is payable in arrears on April 1 and October 1 of each year. The Euro Notes (2024) are fully and unconditionally guaranteed by LKQ Corporation and the Euro Notes (2024) Subsidiaries (the "Euro Notes (2024) Guarantors"). The Euro Notes (2024) and the related guarantees are, respectively, LKQ Italia's and each Euro Notes (2024) Guarantor's senior unsecured obligations and are subordinated to all of LKQ Italia's and the Euro Notes (2024) Guarantors' existing and future secured debt to the extent of the assets securing that secured debt. In addition, the Euro Notes (2024) are effectively subordinated to all of the liabilities of our subsidiaries that are not guaranteeing the Euro Notes (2024) to the extent of the assets of those subsidiaries. The Euro Notes (2024) have been listed on the ExtraMOT, Professional Segment of the Borsa Italia S.p.A. securities exchange and the Global Exchange Market of Euronext Dublin. The Euro Notes (2024) are redeemable, in whole or in part, at any time at a redemption price of 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a "make whole" premium. On or after January 1, 2024, we may redeem some or all of the Euro Notes (2024) at a redemption price of 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date. We may be required to make an offer to purchase the Euro Notes (2024) upon the sale of certain assets, subject to certain exceptions, and upon a change of control. In addition, in the event of certain developments affecting taxation or under certain other circumstances which, in any case, require the payment of certain additional amounts, we may redeem the Euro Notes (2024) in whole, but not in part, at any time at a redemption price of 100% of the principal amount thereof plus accrued but unpaid interest, if any, and such certain additional amounts, if any, to the redemption date. Euro Notes (2026/28) On April 9, 2018, LKQ European Holdings B.V. ("LKQ Euro Holdings"), a wholly-owned subsidiary of LKQ Corporation, completed an offering of €1.0 billion aggregate principal amount of senior notes. The offering consisted of €750 million senior notes due 2026 (the "Euro Notes (2026)") and €250 million senior notes due 2028 (the "Euro Notes (2028)" and, together with the Euro Notes (2026), the "Euro Notes (2026/28)") in a private placement conducted pursuant to Regulation S and Rule 144A under the Securities Act of 1933. The proceeds from the offering, together with borrowings under our senior secured credit facility, were used (i) to finance a portion of the consideration paid for the Stahlgruber acquisition, (ii) for general corporate purposes and (iii) to pay related fees and expenses, including the refinancing of net financial debt. The Euro Notes (2026/28) are governed by the Indenture dated as of April 9, 2018 (the “Euro Notes (2026/28) Indenture”) among LKQ Euro Holdings, LKQ Corporation and certain of our subsidiaries (the “Euro Notes (2026/28) Subsidiaries”), the trustee, paying agent, transfer agent, and registrar. On April 1, 2021, we redeemed the 3.625% Euro Notes (2026) at a redemption price equal to 101.813% of the principal amount of the Euro Notes (2026) plus accrued and unpaid interest thereon to, but not including, April 1, 2021. The total redemption payment was $915 million (€777 million), including an early-redemption premium of $16 million (€14 million) and accrued and unpaid interest of $16 million (€14 million). In the second quarter of 2021, we recorded a loss on debt extinguishment of $24 million related to the redemption due to the early-redemption premium and the write-off of the unamortized debt issuance costs. The Euro Notes (2028) bear interest at a rate of 4.125% per year from the date of original issuance or from the most recent payment date on which interest has been paid or provided for. Interest on the Euro Notes (2028) is payable in arrears on April 1 and October 1 of each year. The Euro Notes (2028) are fully and unconditionally guaranteed by LKQ Corporation and the Euro Notes (2028) Subsidiaries (the "Euro Notes (2028) Guarantors"). The Euro Notes (2028) and the related guarantees are, respectively, LKQ Euro Holdings' and each Euro Notes (2028) Guarantor’s senior unsecured obligations and will be subordinated to all of LKQ Euro Holdings' and the Euro Notes (2028) Guarantors’ existing and future secured debt to the extent of the assets securing that secured debt. In addition, the Euro Notes (2028) are effectively subordinated to all of the liabilities of our subsidiaries that are not guaranteeing the Euro Notes (2028) to the extent of the assets of those subsidiaries. The Euro Notes (2028) have been listed on the Global Exchange Market of Euronext Dublin. The Euro Notes (2028) are redeemable, in whole or in part, at any time at a redemption price of 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date plus a "make whole" premium. On or after April 1, 2023, we may redeem some or all of the Euro Notes (2028) at the applicable redemption prices set forth in the Euro Notes (2026/28) Indenture. We may be required to make an offer to purchase the Euro Notes (2028) upon the sale of certain assets, subject to certain exceptions, and upon a change of control. In addition, in the event of certain developments affecting taxation or under certain other circumstances which, in any case, require the payment of certain additional amounts, we may redeem the Euro Notes (2028) in whole, but not in part, at any time at a redemption price of 100% of the principal amount thereof, plus accrued but unpaid interest, if any, and such certain additional amounts, if any, to the redemption date. Restricted Payments Our senior secured credit agreement and our senior notes indentures contain limitations on payment of cash dividends or other distributions of assets. Delaware law also imposes restrictions on dividend payments. These restrictions will not impact the payment of our dividend declared in October 2021 as disclosed in Note 15, “Subsequent Event”. Receivables Securitization Facility On December 20, 2018, we amended the terms of our receivables securitization facility with MUFG Bank, Ltd. ("MUFG") to: (i) extend the term of the facility to November 8, 2021; (ii) increase the maximum amount available to $110 million; and (iii) make other clarifying and updating changes. Under the facility, LKQ sells an ownership interest in certain receivables, related collections and security interests to MUFG for the benefit of conduit investors and/or financial institutions for cash proceeds. Effective July 30, 2021, we terminated the receivables securitization facility. There was no outstanding balance as of December 31, 2020. Net receivables totaling $121 million were collateral for the investments under the receivables facility as of December 31, 2020.
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Derivative Instruments and Hedging Activities (Notes) |
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Derivative Instruments and Hedging Activities Disclosure [Text Block] | Derivative Instruments and Hedging Activities We are exposed to market risks, including the effect of changes in interest rates, foreign currency exchange rates and commodity prices. Under our current policies, we may use derivatives to manage our exposure to variable interest rates on our senior secured debt and changing foreign exchange rates for certain foreign currency denominated transactions. We do not hold or issue derivatives for trading purposes. Cash Flow Hedges Through June 30, 2021, we held interest rate swap agreements to hedge a portion of the variable interest rate risk on our variable rate borrowings under our Credit Agreement, with the objective of minimizing the impact of interest rate fluctuations and stabilizing cash flows. Under the terms of the interest rate swap agreements, we paid the fixed interest rate and received payment at a variable rate of interest based on LIBOR for the respective currency of each interest rate swap agreement’s notional amount. Changes in the fair value of the interest rate swap agreements were recorded in Accumulated other comprehensive income (loss) and were reclassified to Interest expense, net of interest income when the underlying interest payment impacted earnings. At December 31, 2020, we held cross currency swaps, which contained an interest rate swap component and a foreign currency forward contract component that, combined with related intercompany financing arrangements, effectively converted variable rate U.S. dollar-denominated borrowings into fixed rate euro-denominated borrowings. The swaps were intended to minimize the impact of fluctuating exchange rates and interest rates on the cash flows resulting from the related intercompany financing arrangements. Changes in the fair value of the derivative instruments were recorded in Accumulated other comprehensive income (loss) and were reclassified to Interest expense, net of interest income and Other (income) expense, net when the underlying transactions had an impact on earnings. From time to time, we may hold foreign currency forward contracts related to certain foreign currency denominated intercompany transactions, with the objective of minimizing the impact of fluctuating exchange rates on these future cash flows. Under the terms of the foreign currency forward contracts, we will sell the foreign currency in exchange for U.S. dollars at a fixed rate on the maturity dates of the contracts. Changes in the fair value of the foreign currency forward contracts where we apply hedge accounting are recorded in Accumulated other comprehensive income (loss) and reclassified to Other (income) expense, net when the underlying transaction has an impact on earnings. As of September 30, 2021, we held no cash flow hedges, and as of December 31, 2020, we held cash flow hedges with the following notional amounts and fair values (in thousands):
While certain derivative instruments executed with the same counterparty are subject to master netting arrangements, we present our cash flow hedge derivative instruments on a gross basis on our Unaudited Condensed Consolidated Balance Sheets. The impact of netting the fair values of these contracts would have no effect on our Unaudited Condensed Consolidated Balance Sheets at December 31, 2020. The activity related to our cash flow hedges is included in Note 8, "Accumulated Other Comprehensive Income (Loss)." The activity related to our cash flow hedges is presented in either operating activities or financing activities in our Unaudited Condensed Consolidated Statements of Cash Flows. Other Derivative Instruments Not Designated as Hedges To manage our foreign currency exposure on non-functional currency denominated borrowings, we entered into short term foreign currency forward contracts. As of September 30, 2021, we held no foreign currency forward contracts related to non-functional currency denominated borrowings. At December 31, 2020, the notional amounts of foreign currency forward contracts related to non-functional currency denominated borrowings were €142 million and £75 million. We elected not to apply hedge accounting for these transactions, and therefore the contracts were adjusted to fair value through our results of operations as of each balance sheet date. The fair values of these short-term derivative instruments were recorded in either Prepaid expenses and other current assets or Other accrued expenses on our Unaudited Condensed Consolidated Balance Sheets. The fair values of these contracts at December 31, 2020, along with the effect on our results of operations during the three and nine months ended September 30, 2021 and 2020, were immaterial. We hold other short-term derivative instruments, including foreign currency forward contracts, to manage our exposure to variability in the cash flows related to inventory purchases denominated in a non-functional currency. We have elected not to apply hedge accounting for these transactions. The notional amount and fair value of these contracts at September 30, 2021 and December 31, 2020, along with the effect on our results of operations during the three and nine months ended September 30, 2021 and 2020, were immaterial.
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Fair Value Measurements (Notes) |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures | Fair Value Measurements Financial Assets and Liabilities Measured at Fair Value We use the market and income approaches to estimate the fair value of our financial assets and liabilities, and during the three and nine months ended September 30, 2021, there were no significant changes in valuation techniques or inputs related to the financial assets or liabilities that we have historically recorded at fair value. The tiers in the fair value hierarchy include: Level 1, defined as observable inputs such as quoted market prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as significant unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. The following tables present information about our financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs we utilized to determine such fair value as of September 30, 2021 and December 31, 2020 (in thousands):
The cash surrender value of life insurance is included in Other noncurrent assets on our Unaudited Condensed Consolidated Balance Sheets. The current portion of contingent consideration liabilities is included in Other current liabilities on our Unaudited Condensed Consolidated Balance Sheets; the noncurrent portion of deferred compensation liabilities and contingent consideration liabilities is included in Other noncurrent liabilities on our Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the related payments. The balance sheet classification of the interest rate swaps, cross currency swap agreements, and foreign currency forward contracts is presented in Note 10, "Derivative Instruments and Hedging Activities." Our Level 2 assets and liabilities are valued using inputs from third parties and market observable data. We obtain valuation data for the cash surrender value of life insurance and deferred compensation liabilities from third party sources, which determine the net asset values for our accounts using quoted market prices, investment allocations and reportable trades. We value our other derivative instruments using a third party valuation model that performs a discounted cash flow analysis based on the terms of the contracts and market observable inputs such as current and forward interest rates and current and forward foreign exchange rates. Our contingent consideration liabilities are related to our business acquisitions. Under the terms of the contingent consideration agreements, payments may be made at specified future dates depending on the performance of the acquired business subsequent to the acquisition. The liabilities for these payments are classified as Level 3 liabilities because the related fair value measurement, which is determined using an income approach, includes significant inputs not observable in the market. We also have equity investments recorded in Other noncurrent assets that are reported at fair value. We have used net asset value as a practical expedient to value these equity investments and thus they are excluded from the fair value hierarchy disclosure. Financial Assets and Liabilities Not Measured at Fair Value Our debt is reflected on the Unaudited Condensed Consolidated Balance Sheets at cost. Based on market conditions as of both September 30, 2021 and December 31, 2020, the fair value of our credit agreement borrowings reasonably approximated the carrying values of $1.4 billion and $967 million, respectively. As of September 30, 2021 and December 31, 2020, the fair values of the Euro Notes (2024) were approximately $625 million and $662 million, respectively, compared to carrying values of $579 million and $611 million, respectively. As of December 31, 2020, the fair value of the Euro Notes (2026) was $939 million compared to a carrying value of $916 million; as of September 30, 2021, the Euro Notes (2026) were paid off. As of September 30, 2021 and December 31, 2020, the fair values of the Euro Notes (2028) were $311 million and $332 million, respectively, compared to carrying values of $290 million and $305 million, respectively. The fair value measurements of the borrowings under our credit agreement and receivables facility are classified as Level 2 within the fair value hierarchy since they are determined based upon significant inputs observable in the market, including interest rates on recent financing transactions with similar terms and maturities. We estimated the fair value by calculating the upfront cash payment a market participant would require at September 30, 2021 and December 31, 2020 to assume these obligations. The fair values of our Euro Notes (2024) and Euro Notes (2026/28) are determined based upon observable market inputs including quoted market prices in markets that are not active, and therefore are classified as Level 2 within the fair value hierarchy.
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Employee Benefit Plans (Notes) |
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Pension and Other Postretirement Benefits Disclosure [Text Block] | Employee Benefit Plans We have funded and unfunded defined benefit plans covering certain employee groups in the U.S. and various European countries. Local statutory requirements govern many of our European plans. The defined benefit plans are mostly closed to new participants and, in some cases, existing participants no longer accrue benefits. As of September 30, 2021 and December 31, 2020, the aggregate funded status of the defined benefit plans was a liability of $145 million and $153 million, respectively, and is reported in Other noncurrent liabilities and Accrued payroll-related liabilities on our Unaudited Condensed Consolidated Balance Sheets. Net periodic benefit cost for our defined benefit plans included the following components for the three and nine months ended September 30, 2021 and 2020 (in thousands):
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Income Taxes (Notes) |
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Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | Income Taxes At the end of each interim period, we estimate our annual effective tax rate and apply that rate to our interim earnings. We also record the tax impact of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and the effects of changes in tax laws or rates, in the interim period in which they occur. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and significant judgment including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in state and foreign jurisdictions, permanent and temporary differences between book and taxable income, and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the tax environment changes. Our effective income tax rate for the nine months ended September 30, 2021 was 25.7%, compared to 28.3% for the comparable prior year period. The lower estimated annual effective tax rate for 2021 is primarily attributable to the higher forecasted 2021 results of operations, as compared to the forecasts available during the comparable period in 2020, when COVID-19 pandemic economic disruptions were depressing forecasted 2020 results. For the nine months ended September 30, 2021, the effective tax rate was decreased 0.1% by net favorable discrete items, primarily for excess tax benefits from stock-based payments. For the nine months ended September 30, 2020, the effective tax rate was increased 0.3% by unfavorable discrete items, primarily valuation allowances on net operating loss carryforwards and deferred tax adjustments as a result of statutory tax rate changes.
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Segment and Geographic Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment and Geographic Information | Segment and Geographic Information We have four operating segments: Wholesale – North America, Europe, Specialty and Self Service. Our Wholesale – North America and Self Service operating segments are aggregated into one reportable segment, North America, because they possess similar economic characteristics and have common products and services, customers, and methods of distribution. Our reportable segments are organized based on a combination of geographic areas served and type of product lines offered. The reportable segments are managed separately as each business serves different customers (i.e. geographic in the case of North America and Europe and product type in the case of Specialty) and is affected by different economic conditions. Therefore, we present three reportable segments: North America, Europe and Specialty. The following tables present our financial performance by reportable segment for the periods indicated (in thousands):
(1) Amounts presented include depreciation and amortization expense recorded within Cost of goods sold and Restructuring and acquisition related expenses. The key measure of segment profit or loss reviewed by our chief operating decision maker, our Chief Executive Officer, is Segment EBITDA. We use Segment EBITDA to compare profitability among our segments and evaluate business strategies. Segment EBITDA includes revenue and expenses that are controllable by the segment. Corporate general and administrative expenses are allocated to the segments based on usage, with shared expenses apportioned based on the segment's percentage of consolidated revenue. We calculate Segment EBITDA as EBITDA excluding restructuring and acquisition related expenses (which includes restructuring expenses recorded in Cost of goods sold); change in fair value of contingent consideration liabilities; other gains and losses related to acquisitions, equity method investments, or divestitures; equity in losses and earnings of unconsolidated subsidiaries; equity investment mark to market adjustments; and impairment charges. EBITDA, which is the basis for Segment EBITDA, is calculated as net income attributable to LKQ stockholders excluding discontinued operations and discontinued noncontrolling interest, depreciation, amortization, interest (which includes gains and losses on debt extinguishment) and income tax expense. The table below provides a reconciliation of Net Income to Segment EBITDA (in thousands):
(1) The sum of these two captions represents the total amount that is reported in Restructuring and acquisition related expenses in our Unaudited Condensed Consolidated Statements of Income. Refer to Note 5, "Restructuring and Acquisition Related Expenses," for further information. (2) Refer to "Investments in Unconsolidated Subsidiaries" in Note 3, "Financial Statement Information," for further information. The following table presents capital expenditures by reportable segment (in thousands):
The following table presents assets by reportable segment (in thousands):
We report net receivables; inventories; net property, plant and equipment; net operating lease assets; and equity method investments by segment as that information is used by the chief operating decision maker in assessing segment performance. These assets provide a measure for the operating capital employed in each segment. Unallocated assets include cash and cash equivalents, prepaid and other current and noncurrent assets, goodwill and other intangibles. Our largest countries of operation are the U.S., followed by the U.K. and Germany. Additional European operations are located in the Netherlands, Italy, Czech Republic, Belgium, Austria, Slovakia, Poland, and other European countries. Our operations in other countries include wholesale operations in Canada, remanufacturing operations in Mexico, an aftermarket parts freight consolidation warehouse in Taiwan, and administrative support functions in India. Our net sales are attributed to geographic area based on the location of the selling operation. The following table sets forth our revenue by geographic area (in thousands):
The following table sets forth our tangible long-lived assets by geographic area (in thousands):
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Subsequent Events |
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Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventOn October 26, 2021, the Board of Directors of LKQ declared a cash dividend to stockholders. The quarterly cash dividend of $0.25 per share of common stock will be payable on December 2, 2021 to stockholders of record at the close of business on November 11, 2021. |
Financial Statement Information Receivables (Policies) |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Government Assistance | Government Assistance During the three and nine months ended September 30, 2021 and 2020, we recorded financial assistance from foreign governments, primarily in the form of grants, as credits in the following amounts (in thousands):
For the nine months ended September 30, 2021 and 2020, we received grants from European governments of $11 million and $38 million, respectively, with the remaining amounts related to Canada. Financial assistance received from governments is recorded during the period in which we incur the costs that the assistance is intended to offset (and only if it is probable that we will meet the conditions required under the terms of the assistance).
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Equity Method Investments [Policy Text Block] | Investments in Unconsolidated Subsidiaries Our investment in unconsolidated subsidiaries was $178 million and $155 million as of September 30, 2021 and December 31, 2020, respectively. Europe Segment Our investment in unconsolidated subsidiaries in Europe was $155 million and $137 million as of September 30, 2021 and December 31, 2020, respectively. We recorded equity in earnings of $4 million and $13 million during the three and nine months ended September 30, 2021, respectively, and equity in earnings of $4 million and $5 million during the three and nine months ended September 30, 2020, respectively, mainly related to our investment in Mekonomen AB ("Mekonomen"). We are accounting for our 26.6% equity interest in Mekonomen using the equity method of accounting, as our investment gives us the ability to exercise significant influence, but not control, over the investee. As of September 30, 2021, our share of the book value of Mekonomen's net assets exceeded the book value of our investment in Mekonomen by $8 million; this difference is primarily related to Mekonomen's Accumulated Other Comprehensive Income balance as of our acquisition date in 2016. We are recording our equity in the net earnings of Mekonomen on a one quarter lag. Mekonomen announced in March 2020 and February 2021, respectively, that the Mekonomen Board of Directors proposed no dividend payment in 2020 or 2021. The Level 1 fair value of our equity investment in the publicly traded Mekonomen common stock at September 30, 2021 was $271 million (using the Mekonomen share price of SEK 156 as of September 30, 2021) compared to a carrying value of $144 million. North America Segment Our investment in unconsolidated subsidiaries in the North America segment was $24 million and $19 million as of September 30, 2021 and December 31, 2020, respectively. We recorded equity in earnings of $3 million and $4 million during the three and nine months ended September 30, 2021, respectively, and equity in earnings of an immaterial amount and equity in losses of $3 million during the three and nine months ended September 30, 2020, respectively, related to our North America equity method investments.
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Receivable | Allowance for Credit Losses Receivables, net are reported net of an allowance for credit losses. Management evaluates the aging of customer receivable balances, the financial condition of our customers, historical trends, and macroeconomic factors to estimate the amount of customer receivables that may not be collected in the future and records a provision it believes is appropriate. Our reserve for expected lifetime credit losses was $63 million and $70 million as of September 30, 2021 and December 31, 2020, respectively. Bad debt expense totaled $3 million and $23 million for the nine months ended September 30, 2021 and 2020, respectively.
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Financial Statement Information Inventories (Policies) |
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Inventory [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory, Policy [Policy Text Block] | Inventories Inventories consist of the following (in thousands):
Aftermarket and refurbished products and salvage and remanufactured products are primarily composed of finished goods. As of September 30, 2021, manufactured products inventory was composed of $24 million of raw materials, $5 million of work in process, and $1 million of finished goods. As of December 31, 2020, manufactured products inventory was composed of $16 million of raw materials, $3 million of work in process, and $2 million of finished goods.
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Financial Statement Information Investments in Unconsolidated Subsidiaries (Policies) |
9 Months Ended |
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Sep. 30, 2021 | |
Investments in Unconsolidated Subsidiaries [Abstract] | |
Equity Method Investments [Policy Text Block] | Investments in Unconsolidated Subsidiaries Our investment in unconsolidated subsidiaries was $178 million and $155 million as of September 30, 2021 and December 31, 2020, respectively. Europe Segment Our investment in unconsolidated subsidiaries in Europe was $155 million and $137 million as of September 30, 2021 and December 31, 2020, respectively. We recorded equity in earnings of $4 million and $13 million during the three and nine months ended September 30, 2021, respectively, and equity in earnings of $4 million and $5 million during the three and nine months ended September 30, 2020, respectively, mainly related to our investment in Mekonomen AB ("Mekonomen"). We are accounting for our 26.6% equity interest in Mekonomen using the equity method of accounting, as our investment gives us the ability to exercise significant influence, but not control, over the investee. As of September 30, 2021, our share of the book value of Mekonomen's net assets exceeded the book value of our investment in Mekonomen by $8 million; this difference is primarily related to Mekonomen's Accumulated Other Comprehensive Income balance as of our acquisition date in 2016. We are recording our equity in the net earnings of Mekonomen on a one quarter lag. Mekonomen announced in March 2020 and February 2021, respectively, that the Mekonomen Board of Directors proposed no dividend payment in 2020 or 2021. The Level 1 fair value of our equity investment in the publicly traded Mekonomen common stock at September 30, 2021 was $271 million (using the Mekonomen share price of SEK 156 as of September 30, 2021) compared to a carrying value of $144 million. North America Segment Our investment in unconsolidated subsidiaries in the North America segment was $24 million and $19 million as of September 30, 2021 and December 31, 2020, respectively. We recorded equity in earnings of $3 million and $4 million during the three and nine months ended September 30, 2021, respectively, and equity in earnings of an immaterial amount and equity in losses of $3 million during the three and nine months ended September 30, 2020, respectively, related to our North America equity method investments.
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Financial Statement Information Warranty Reserve (Policies) |
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Warranty Reserve [Abstract] | |||||||||||||||||||||||||||||||
Standard Product Warranty And Extended Product Warranty Policy Policy [Policy Text Block] | Warranty Reserve Some of our salvage mechanical products are sold with a standard six month warranty against defects. Additionally, some of our remanufactured engines are sold with a standard three or four year warranty against defects. We also provide a limited lifetime warranty for certain of our aftermarket products. These assurance-type warranties are not considered a separate performance obligation, and thus no transaction price is allocated to them. We record the warranty costs in Cost of goods sold in our Unaudited Condensed Consolidated Statements of Income. Our warranty reserve is calculated using historical claim information to project future warranty claims activity and is recorded within Other accrued expenses and Other noncurrent liabilities on our Unaudited Condensed Consolidated Balance Sheets based on the expected timing of the related payments. The changes in the warranty reserve are as follows (in thousands):
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Financial Statement Information Litigation and Related Contingencies (Policies) |
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Sep. 30, 2021 | |
Litigation and Related Contingencies [Abstract] | |
Commitments and Contingencies, Policy [Policy Text Block] | Litigation and Related Contingencies We have certain contingencies resulting from litigation, claims and other commitments and are subject to a variety of environmental and pollution control laws and regulations incident to the ordinary course of business. We currently expect that the resolution of such contingencies will not materially affect our financial position, results of operations or cash flows.
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Financial Statement Information Treasury Stock (Policies) |
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Sep. 30, 2021 | |
Treasury Stock [Abstract] | |
Stockholders' Equity, Policy [Policy Text Block] | Stockholders' Equity Treasury Stock As of June 30, 2021, our Board of Directors had authorized a stock repurchase program under which we were able to purchase up to $1.0 billion of our common stock from time to time through October 25, 2022. On July 28, 2021, our Board of Directors authorized a $1.0 billion increase and a two year extension to our stock repurchase program, raising the aggregate authorization under the program to $2.0 billion and authorizing repurchases through October 25, 2024. Repurchases under the program may be made in the open market or in privately negotiated transactions, with the amount and timing of repurchases depending on market conditions and corporate needs. The repurchase program does not obligate us to acquire any specific number of shares and may be suspended or discontinued at any time. Repurchased shares are accounted for as treasury stock using the cost method. During the three and nine months ended September 30, 2021, we repurchased 4.3 million and 12.0 million shares of common stock, respectively, for an aggregate price of $219 million and $580 million, respectively. During the nine months ended September 30, 2020, we repurchased 3.3 million shares of common stock for an aggregate price of $88 million; we did not repurchase any shares during the three months ended September 30, 2020. As of September 30, 2021, there was $951 million of remaining capacity under our repurchase program. Noncontrolling Interest In February 2020, as part of the sale of Stahlgruber's Czech Republic business, we divested the noncontrolling interest of the business, which resulted in a net decrease to Noncontrolling interest of $11 million in our unaudited condensed consolidated financial statements as of March 31, 2020. See Note 2, "Discontinued Operations," for further information. In December 2019, we modified the shares of a noncontrolling interest of a subsidiary acquired in connection with the Stahlgruber acquisition and issued new redeemable shares to the minority shareholder. The new redeemable shares contain (i) a put option for all noncontrolling interest shares at a fixed price of $24 million (€21 million) for the minority shareholder exercisable in the fourth quarter of 2023, (ii) a call option for all noncontrolling interest shares at a fixed price of $26 million (€23 million) for the Company exercisable beginning in the first quarter of 2026 through the end of the fourth quarter of 2027, and (iii) a guaranteed dividend to be paid quarterly to the minority shareholder through the fourth quarter of 2023. The new redeemable shares do not provide the minority shareholder with rights to participate in the profits and losses of the subsidiary prior to the exercise date of the put option. As the put option is outside the control of the Company, we recorded a $24 million Redeemable noncontrolling interest at the put option's redemption value outside of permanent equity on our Unaudited Condensed Consolidated Balance Sheets.
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Financial Statement Information Recent Accounting Pronouncements (Policies) |
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Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements Policy [Policy Text Block] | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In the first quarter of 2021, we adopted ASU No. 2019-12, "Income Taxes" (Topic 740) ("ASU 2019-12"), which simplifies the accounting for income taxes and adds guidance to reduce complexity in certain areas. We adopted the standard in the first quarter using the prospective approach. The adoption of this accounting standard did not have a material impact on our unaudited condensed consolidated financial statements. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, "Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting" ("ASU 2020-04"), which provides temporary optional guidance to ease the potential burden in accounting for reference rate reform. ASU 2020-04 provides optional expedients and exceptions for applying generally accepted accounting principles to transactions affected by reference rate reform if certain criteria are met. These transactions include contract modifications, hedging relationships, and sale or transfer of debt securities classified as held-to-maturity. Entities may apply the provisions of the new standard as of the beginning of the reporting period when the election is made (i.e., as early as the first quarter of 2020). Unlike other topics, the provisions of this update are only available until December 31, 2022. We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures, and we have not yet elected an adoption date.
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Financial Statement Information (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory, Current [Table Text Block] | Inventories consist of the following (in thousands):
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Schedule of Product Warranty Liability [Table Text Block] | The changes in the warranty reserve are as follows (in thousands):
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Government Assistance | During the three and nine months ended September 30, 2021 and 2020, we recorded financial assistance from foreign governments, primarily in the form of grants, as credits in the following amounts (in thousands):
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Revenue Recognition Disaggregation of Revenue (Tables) |
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Schedule of Product Warranty Liability [Table Text Block] | The changes in deferred service-type warranty revenue are as follows (in thousands):
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Disaggregation of Revenue [Table Text Block] | The following table sets forth our revenue by category, with our parts and services revenue further disaggregated by reportable segment (in thousands):
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Equity Incentive Plans (Tables) |
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Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Nonvested Restricted Stock Units Activity | The following table summarizes activity related to our RSUs under the Equity Incentive Plan for the nine months ended September 30, 2021:
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Schedule of Nonvested Performance-based Units Activity | The following table summarizes activity related to our PSUs under the Equity Incentive Plan for the nine months ended September 30, 2021:
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Earnings Per Share Schedule of Earnings Per Share, Basic and Diluted (Tables) |
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Schedule of Earnings Per Share, Basic and Diluted [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following chart sets forth the computation of earnings per share (in thousands, except per share amounts):
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Earnings Per Share Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Tables) |
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Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | The following table sets forth the number of employee stock-based compensation awards outstanding but not included in the computation of diluted earnings per share because their effect would have been antidilutive for the three and nine months ended September 30, 2021 and 2020 (in thousands):
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Accumulated Other Comprehensive Income (Loss) Accumulated Other Comprehensive Income (Loss) (Tables) |
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Cash Flow Hedges Reclassified to Interest Expense [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash Flow Hedges Reclassified to Interest Expense [Table Text Block] | The amounts of unrealized gains and losses on our Cash Flow Hedges reclassified to our Unaudited Condensed Consolidated Statements of Income are as follows (in thousands):
(1)The amounts reclassified to Other (income) expense, net in our Unaudited Condensed Consolidated Statements of Income offset the impact of the remeasurement of the underlying transactions.
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Accumulated Other Comprehensive Income (Loss) | The components of Accumulated Other Comprehensive Income (Loss) are as follows (in thousands):
Net unrealized losses and gains related to our pension plans were reclassified to Other (income) expense, net in our Unaudited Condensed Consolidated Statements of Income during each of the three and nine months ended September 30, 2021 and 2020. Our policy is to reclassify the income tax effect from Accumulated other comprehensive loss to the Provision for income taxes when the related gains and losses are released to the Unaudited Condensed Consolidated Statements of Income.
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Long-Term Obligations (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Long-Term Obligations | Long-term obligations consist of the following (in thousands):
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Derivative Instruments and Hedging Activities (Tables) |
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Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts of Outstanding Derivative Positions | As of September 30, 2021, we held no cash flow hedges, and as of December 31, 2020, we held cash flow hedges with the following notional amounts and fair values (in thousands):
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Fair Value Option, Disclosures |
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Fair Value Measurements (Tables) |
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Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The following tables present information about our financial assets and liabilities measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation inputs we utilized to determine such fair value as of September 30, 2021 and December 31, 2020 (in thousands):
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Employee Benefit Plans (Tables) |
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Employee Benefit Plans [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Benefit Costs [Table Text Block] | Net periodic benefit cost for our defined benefit plans included the following components for the three and nine months ended September 30, 2021 and 2020 (in thousands):
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Segment and Geographic Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Financial Performance By Reportable Segment | The following tables present our financial performance by reportable segment for the periods indicated (in thousands):
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||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation Of Segment EBITDA To Net Income Table | The table below provides a reconciliation of Net Income to Segment EBITDA (in thousands):
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Schedule Of Capital Expenditures By Reportable Segment | The following table presents capital expenditures by reportable segment (in thousands):
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Schedule Of Assets By Reportable Segment | The following table presents assets by reportable segment (in thousands):
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Revenue from External Customers by Geographic Area | The following table sets forth our revenue by geographic area (in thousands):
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Schedule Of Tangible Long-Lived Assets By Geographic Area | The following table sets forth our tangible long-lived assets by geographic area (in thousands):
|
Financial Statement Information Intangible Assets (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Intangible Assets | ||
Amount that fair value exceeds carrying value | 30.00% | |
Goodwill | $ 4,525,474 | $ 4,591,569 |
Financial Statement Information Warranty Reserve (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
|
Warranty Reserve [Abstract] | ||
Standard Product Warranty Accrual | $ 30,929 | $ 27,914 |
Standard Product Warranty Accrual, Increase for Warranties Issued | 56,254 | |
Standard Product Warranty Accrual, Decrease for Payments | $ 53,239 |
Financial Statement Information Treasury Stock (Details) - USD ($) $ in Thousands, shares in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2021 |
Sep. 30, 2020 |
Jul. 28, 2021 |
Jun. 30, 2021 |
|
Treasury Stock [Abstract] | |||||
Stock Repurchase Program, Authorized Amount | $ 2,000,000 | $ 1,000,000 | |||
Stock Repurchased During Period, Shares | 4.3 | 12.0 | 3.3 | ||
Payments for Repurchase of Common Stock | $ 574,585 | $ 88,006 | |||
Stock Repurchase Program Remaining Authorized Repurchases, Amount | $ 951,000 | $ 951,000 | |||
Stock Repurchase Program, Increase In Authorized Amount | $ 1,000,000 |
Financial Statement Information Recently Adopted Accounting Pronouncements (Details) $ in Thousands |
9 Months Ended |
---|---|
Sep. 30, 2020
USD ($)
| |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Cumulative Effect on Retained Earnings, before Tax | $ (2,519) |
Financial Statement Information Noncontrolling Interest (Details) |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Mar. 31, 2020
USD ($)
|
Sep. 30, 2020
USD ($)
|
Sep. 30, 2021
USD ($)
|
Dec. 31, 2020
USD ($)
|
Dec. 31, 2019
USD ($)
|
Dec. 31, 2019
EUR (€)
|
|
Noncontrolling Interest [Line Items] | ||||||
Noncontrolling Interest, Decrease from Deconsolidation | $ 11,404,000 | |||||
Redeemable noncontrolling interest | $ 24,077,000 | $ 24,077,000 | $ 24,000,000 | |||
Redeemable NCI, Call Option | 26,000,000 | € 23,000,000 | ||||
Reedemable NCI, Put Option | $ 24,000,000 | € 21,000,000 | ||||
Stahlgruber Czech Republic Wholesale Business [Member] | ||||||
Noncontrolling Interest [Line Items] | ||||||
Noncontrolling Interest, Decrease from Deconsolidation | $ 11,000,000 | |||||
Noncontrolling Interest | ||||||
Noncontrolling Interest [Line Items] | ||||||
Noncontrolling Interest, Decrease from Deconsolidation | $ 11,404,000 |
Financial Statement Information Government Assistance (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Government Assistance [Line Items] | ||||
Government Assistance Amount | $ 1,047 | $ 12,449 | $ 15,647 | $ 45,093 |
Europe | ||||
Government Assistance [Line Items] | ||||
Government Assistance Amount | 11,000 | 38,000 | ||
Selling, General and Administrative Expenses [Member] | ||||
Government Assistance [Line Items] | ||||
Government Assistance Amount | 884 | 11,754 | 15,121 | 43,928 |
cost of goods and services sold [Member] | ||||
Government Assistance [Line Items] | ||||
Government Assistance Amount | $ 163 | $ 695 | $ 526 | $ 1,165 |
Revenue Recognition Movement in Standard Product Warranty Accrual (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
|
Product Warranty Liability [Line Items] | ||
Contract with Customer, Right to Recover Product | $ 59,000 | $ 57,000 |
Contract with Customer, Refund Liability | 108,000 | 102,000 |
Revenue, Variable Consideration Reserve | 131,000 | 127,000 |
Deferred Service-Type Warranty Revenue | 31,747 | $ 25,622 |
Deferred Revenue, Additions | 51,159 | |
Deferred Revenue, Revenue Recognized | $ 45,034 | |
Minimum [Member] | ||
Product Warranty Liability [Line Items] | ||
Standard Product Warranty Period | 6 months | |
Maximum | ||
Product Warranty Liability [Line Items] | ||
Standard Product Warranty Period | 36 months |
Schedule of Stock-Based Compensation Expense Expected to be Recognized (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock-based compensation expense | $ 8,000 | $ 7,000 | $ 24,989 | $ 22,851 |
Share-based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ 50,000 | $ 50,000 |
Schedule of Antidilutive Securities Excluded from Computation of Diluted Earnings Per Share (Details) - shares shares in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Restricted Stock Units (RSUs) [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive securities | 0 | 717 | 39 | 847 |
Accumulated Other Comprehensive Income (Loss) Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Schedule of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Reclassification From Aoci Current Period Net Of Tax Attributable To Parent Unrealized Loss Gains | $ (427) | $ (23,947) | $ 457 | $ (20,770) |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent [Member] | ||||
Schedule of Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Reclassification From Aoci Current Period Net Of Tax Attributable To Parent Unrealized Loss Gains | $ 0 | $ (20,153) | $ 1,758 | $ (14,207) |
Schedule of Long-Term Obligations (Parenthetical) (Details) |
9 Months Ended | |
---|---|---|
Sep. 30, 2021 |
Dec. 31, 2020 |
|
Debt Instrument | ||
Finance Lease, Weighted Average Discount Rate, Percent | 3.50% | 3.50% |
Notes Payable [Member] | ||
Debt Instrument | ||
Debt, Weighted Average Interest Rate | 3.10% | 3.30% |
Senior Notes 2024 [Member] | ||
Debt Instrument | ||
Debt Instrument, Redemption Price, Percentage | 100.00% | |
Other Debt [Member] [Member] | ||
Debt Instrument | ||
Debt, Weighted Average Interest Rate | 0.70% | 1.20% |
Revolving Credit Facility [Member] | ||
Debt Instrument | ||
Debt, Weighted Average Interest Rate | 1.10% | 1.70% |
Derivative Instruments and Hedging Activities (Details) - Dec. 31, 2020 € in Thousands, kr in Thousands, $ in Thousands, £ in Millions |
USD ($) |
EUR (€) |
SEK (kr) |
GBP (£) |
---|---|---|---|---|
Derivative Liability, Current | $ 58,577 | |||
Interest Rate Swap [Member] | ||||
Derivative, Notional Amount | 480,000 | |||
Cross Currency Interest Rate Contract [Member] | ||||
Derivative, Notional Amount | € | € 340,000 | |||
Forward Contracts | ||||
Derivative, Notional Amount | € 142,000 | kr 227,000 | £ 75 | |
Fair Value, Recurring [Member] | Cross Currency Interest Rate Contract [Member] | ||||
Derivative Liability, Current | 56,328 | |||
Fair Value, Recurring [Member] | Interest Rate Swap [Member] | ||||
Derivative Liability, Current | 899 | |||
Fair Value, Recurring [Member] | Forward Contracts | ||||
Derivative Liability, Current | $ 1,350 |
Employee Benefit Plans (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
Dec. 31, 2020 |
|
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined Benefit Plan, Funded (Unfunded) Status of Plan | $ 145,000 | $ 145,000 | $ 153,000 | ||
Defined Benefit Plan, Service Cost | 921 | $ 688 | 2,749 | $ 2,214 | |
Defined Benefit Plan, Interest Cost | 333 | 682 | 1,028 | 2,131 | |
Defined Benefit Plan, Expected Return (Loss) on Plan Assets | (415) | (411) | (1,261) | (1,551) | |
Defined Benefit Plan, Amortization of Gain (Loss) | (427) | (238) | (1,301) | (907) | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) | 1,266 | 4,753 | 3,817 | 9,357 | |
Defined Benefits Plan, Settlements Loss | $ 0 | $ 3,556 | $ 0 | $ 5,656 |
Income Taxes - Additional Information (Details) |
9 Months Ended | |
---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Effective Income Tax Rate Reconciliation, Percent | 25.70% | 28.30% |
Effective Income Tax Rate Reconciliation, Change as a result of the Discrete Items, Percent | 0.10% | 0.30% |
Schedule of Capital Expenditures by Reportable Segment (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Segment Reporting Information | ||||
Capital Expenditures | $ 44,851 | $ 32,648 | $ 132,705 | $ 109,949 |
Specialty [Member] | ||||
Segment Reporting Information | ||||
Capital Expenditures | 3,244 | 2,876 | 13,445 | 7,414 |
North America | ||||
Segment Reporting Information | ||||
Capital Expenditures | 22,654 | 12,352 | 52,806 | 52,565 |
Europe | ||||
Segment Reporting Information | ||||
Capital Expenditures | $ 18,953 | $ 17,420 | $ 66,454 | $ 49,970 |
Segment and Geographic Information Schedule of Revenue by Geographic Area (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2021 |
Sep. 30, 2020 |
Sep. 30, 2021 |
Sep. 30, 2020 |
|
Revenues from External Customers and Long-Lived Assets | ||||
Revenues | $ 3,296,611 | $ 3,047,684 | $ 9,902,511 | $ 8,674,942 |
UNITED STATES | ||||
Revenues from External Customers and Long-Lived Assets | ||||
Revenues | 1,671,186 | 1,463,063 | 5,026,114 | 4,327,563 |
GERMANY | ||||
Revenues from External Customers and Long-Lived Assets | ||||
Revenues | 413,914 | 396,119 | 1,220,608 | 1,129,805 |
UNITED KINGDOM | ||||
Revenues from External Customers and Long-Lived Assets | ||||
Revenues | 428,730 | 411,861 | 1,253,482 | 1,080,899 |
Other countries | ||||
Revenues from External Customers and Long-Lived Assets | ||||
Revenues | $ 782,781 | $ 776,641 | $ 2,402,307 | $ 2,136,675 |
Schedule of Tangible Long-Lived Assets by Geographic Area (Details) - USD ($) $ in Thousands |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|
Revenues from External Customers and Long-Lived Assets | ||
Long-Lived Assets | $ 2,533,421 | $ 2,601,827 |
UNITED STATES | ||
Revenues from External Customers and Long-Lived Assets | ||
Long-Lived Assets | 1,410,729 | 1,419,113 |
UNITED KINGDOM | ||
Revenues from External Customers and Long-Lived Assets | ||
Long-Lived Assets | 290,943 | 315,333 |
Other countries | ||
Revenues from External Customers and Long-Lived Assets | ||
Long-Lived Assets | 500,423 | 507,197 |
GERMANY | ||
Revenues from External Customers and Long-Lived Assets | ||
Long-Lived Assets | $ 331,326 | $ 360,184 |
Subsequent Events (Details) |
Dec. 02, 2021
$ / shares
|
---|---|
Subsequent Events [Abstract] | |
Dividends Payable, Amount Per Share | $ 0.25 |