The following is a summary of the AutoCanada Inc. (AOCIF) Q1 2024 Earnings Call Transcript:
Financial Performance:
AutoCanada reported Q1 sales of $1.4 billion, a decrease of 7.7% compared to the same period in 2023, primarily due to lower used vehicle sales volume.
An adjusted EBITDA of $22 million was reported, signifying a decline of 51.2% year-over-year.
The quarter brought a diluted loss per share of $0.10 and a decrease of $4.6 million in employee expenses.The net funded debt to bank EBITDA covenant ratio stood at 2.79.
Despite strategic initiatives, the company expects short-term macroeconomic challenges to continue.
Business Progress:
AutoCanada is implementing Project Elevate, a strategic plan focused on enhancing efficiency and improving market position.
The company has successfully restructured its US operations and brought down the average days reconditioning from 63 to 8.3.
The Collision repair division, to be reported separately, showed a same-store gross profit increase of 31.3%.
With high car prices and a lack of fresh trades impacting inventory, AutoCanada is working on acquisition efficiencies to improve used car inventory.
A merger with Kijiji F&I and ICO applications is also underway to diversify sales.
As part of Project Elevate, contracts with vendors are being reassessed for cost savings, and a shared services and HRIS system infrastructure is being developed for better governance and operation.
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