SEGMENT INFORMATION

12 Months Ended

Dec. 31, 2023

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

As of December 31, 2023, the Company had two reportable segments: (1) Dealerships and (2) TCA. Our dealership operations are organized by management into geographic market-based groups within the Dealerships segment. The operations of our F&I product provider is reflected within our TCA segment. Our Chief Operating Decision Maker is our Chief Executive Officer who manages the business, regularly reviews financial information and allocates resources at the geographic market level for our dealerships and at the TCA segment level for our F&I product provider's operations. The geographic dealership group operating segments have been aggregated into one reportable segment as their operations (i) have similar economic characteristics (our markets all have similar long-term average gross margins), (ii) offer similar products and services (all of our markets offer new and used vehicles, parts and service, and finance and insurance products), (iii) have similar customers, (iv)

have similar distribution and marketing practices (all of our markets distribute products and services through dealership facilities that market to customers in similar ways), and (v) operate under similar regulatory environments.

TCA's vehicle protection products are sold through affiliated dealerships and the revenue from the related commissions is included in finance and insurance, net revenue in the Dealerships segment before consolidation. The corresponding claims expense incurred and the amortization of deferred acquisition costs is recorded as a cost of sales in the TCA segment. The Dealerships segment also provides vehicle repair and maintenance services to TCA customers in connection with claims related to TCA's vehicle protection products. Upon consolidation, the associated service revenue and costs recorded by the Dealerships segment are eliminated against claims expense recorded by the TCA segment.

The preliminary amount of goodwill acquired in the Koons acquisition of $231.7 million was allocated to the Dealerships segment.

The majority of TCA’s revenue arises from sales through our affiliated dealerships. Intercompany profits and losses are eliminated in consolidation.

Reportable segment financial information for the years ended December 31, 2023 and 2022 is as follows:

	As of and for the year ended December 31, 2023
	Dealerships		TCA		Eliminations		Total Company
	(In millions)
Revenue	$	14,699.0	$	285.2	$	(181.5)	$	14,802.7
Gross profit	2,671.1		77.1		7.6		2,755.8
Depreciation and amortization	67.1		0.7		—		67.7
Selling, general and administrative expense	1,638.5		7.4		(28.5)		1,617.4
Interest expense
Floor plan interest expense	9.6		—		—		9.6
Other interest expense, net	156.1		—		—		156.1
Total interest expense	$	165.7	$	—	$	—	$	165.7
Capital expenditures	142.3		—		—		142.3
Total assets	$	9,199.4	$	913.9	$	46.1	$	10,159.4

	As of and for the year ended December 31, 2022
	Dealerships		TCA		Eliminations		Total Company
	(In millions)
Revenue	$	15,341.1	$	245.8	$	(153.0)	$	15,433.8
Gross profit	3,036.0		53.8		10.8		3,100.6
Depreciation and amortization	68.2		0.8		—		69.0
Selling, general and administrative expense	1,786.3		7.0		(30.0)		1,763.4
Interest expense
Floor plan interest expense	8.4		—		—		8.4
Other interest expense, net	152.2		—		—		152.2
Total interest expense	$	160.6	$	—	$	—	$	160.6
Capital expenditures	94.6		—		—		94.6
Total assets	$	7,170.8	$	869.2	$	(18.6)	$	8,021.4