AUTOCANADA ANNOUNCES SECOND QUARTER RESULTS

• Revenue from continuing operations was $1,338.2 million as compared to $1,381.2 million in the prior year, a decrease of $(43.0) million
• Net income for the period from total operations was $18.9 million as compared to a net loss of $(33.1) million in the prior year
  • Net income from continuing operations was $18.9 million as compared to $3.9 million in the prior year
  • Net loss from discontinued operations was $0.0 million as compared to $(37.0) million in the prior year
• Diluted net income per share from continuing operations was $0.72 as compared to $0.12 in the prior year
• Adjusted EBITDA from total operations¹ was $68.5 million as compared to $27.0 million in the prior year
  • Adjusted EBITDA from continuing operations¹ was $64.4 million as compared to $33.5 million in the prior year
  • Adjusted EBITDA from discontinued operations¹ was $4.1 million as compared to $(6.5) million in the prior year¹
• Total Net Funded Debt to Bank EBITDA Ratio² reduced from 4.92x as at March 31, 2025 to 3.42x as at June 30, 2025

EDMONTON, AB, Aug. 13, 2025 /CNW/ – AutoCanada Inc. (“AutoCanada” or the “Company”) (TSX: ACQ), a multi-location North American automobile dealership group, today reported its financial results for the three-month period ended June 30, 2025.

Paul Antony, Executive Chairman, stated, “AutoCanada’s second quarter results reflect the momentum we’re building as our transformation takes hold. With $80.0 million in annualized savings already realized, we’ve raised our target to $115.0 million, exceeding the original $100.0 million ambition we committed to at the beginning of this year. At the same time, we’ve made decisive progress on the U.S. divestiture, with one dealership sold and a clear path to exit the remaining dealerships. Expected total net proceeds of $115.0 to $130.0 million from the sale of our U.S. dealerships will meaningfully deleverage the balance sheet and sharpen our focus on the core Canadian business.

“Our team is squarely focused on completing the transformation, and we remain on track to deliver $48.5 million in net in-year savings by year-end, even after accounting for $29.3 million in restructuring costs,” said Paul Antony, Executive Chairman. “While Canadian new vehicle demand has been strong so far this year, the potential impact of tariffs on the industry remains unclear. We may also see some near-term softness in same store sales as our store-level teams focus on execution and operational efficiency. As the transformation concludes, we expect sales momentum to normalize, underpinned by the comprehensive restructuring that has established a more efficient and sustainable cost structure, positioning the business to refocus on rebuilding volume from a stronger, more profitable foundation.”

As we enter the final phase of our transformation, AutoCanada has come full circle, returning to its roots as a focused consolidator of Canadian dealerships and collision centres. With the major pieces in place, the time is right for a leadership transition. As we close out the year, our priorities are clear: complete the U.S. exit, deliver the remaining savings, deleverage the balance sheet, and position the company for its next chapter of profitable growth.

I want to sincerely thank our employees across the country who have worked relentlessly to drive this transformation, and our OEM partners for their continued support. It’s been a privilege to lead this company through such a critical chapter in its history.”

Second Quarter Key Highlights and Recent Developments

Revenue decreased by (3.1)% in the second quarter of 2025 compared to the second quarter of 2024, primarily due to decreases in used vehicle sales and F&I. This decline is partially offset by increases in revenue from new vehicle sales, parts and service and collision repair services.

Gross profit increased by 2.1% to $225.4 million in the second quarter of 2025 compared to the second quarter of 2024, driven by increases in used vehicle and collision repair services gross profit. These increases were partially offset by decreases in new vehicle, parts and service, and F&I. A key factor contributing to the increase in gross profit is the improvement in used vehicle gross profit per retail unit², which offset the impact of lower overall total retail² unit volumes from both new and used during the quarter. Used vehicle gross profit improvements are driven by better management of used vehicle inventory, which is a key focus of the ACX Operating method and lapping a used vehicle provision taken in the second quarter of 2024.

Operating expenses before depreciation² decreased by (9.0)% to $157.1 million in the second quarter of 2025 compared to the second quarter of 2024. Normalized operating expenses before depreciation¹ decreased by (10.1)% to $147.5 million, and included the normalization of $6.0 million of restructuring charges related to the ongoing initiatives targeting $115.0 million in annual run-rate cost savings by the end of 2025. This guidance has been raised from $100.0 million in annual run-rate cost savings in-light of faster-than-expected progress achieved to date.

Floorplan financing expenses decreased (48.1)% to $9.0 million due to reduced new and used vehicle inventory levels and lower interest rates. Inventory management has been a focus in conjunction with the implementation of the ACX Operating Method.

Net income for the period increased by 380.6% to $18.9 million in the second quarter of 2025 compared to the second quarter of 2024, as a result of items noted above, which is partially offset by higher income taxes.

Adjusted EBITDA¹ increased by 92.4% to $64.4 million in the second quarter of 2025 compared to the second quarter of 2024, while adjusted EBITDA margin¹ improved 2.4 ppts to 4.8%. These improvements were driven by lower operating expenses before depreciation², lower floorplan financing expenses and improved gross profit as noted above.

Collision Operations Highlights

Revenue and gross profit increased as a result of strong customer demand, additional Original Equipment Manufacturer (“OEM”) certifications, increased insurance referrals and increased hail repairs.

Gross profit percentage² decreased due to an increase in paintless dent repair which has a lower margin profile than traditional collision repair.

Trends in the same store revenue, gross profit and gross profit percentage² are consistent with overall business performance, with the reasons noted above.

Adjusted EBITDA¹ increased as a result of revenue growth and gross profit improvements described above.

Other Recent Developments

During the quarter:

• On April 30, 2025, the Company completed the divestiture of North Toronto Auction, a used vehicle auction business operating in Innisfil, Ontario for $3.3 million in proceeds.
• On May 28, 2025, the Company terminated its Alfa Romeo and FIAT franchise at Maple Ridge Chrysler Dodge Jeep Ram & Fraser Valley Alfa Romeo, located in Maple Ridge, British Columbia.

After the quarter:

• On July 11, 2025, the Company announced that Paul Antony will transition from his role as Executive Chair. The Board of Directors has begun a search for a Chief Executive Officer.
• On July 16, 2025, the Company announced that it has entered into definitive agreements to sell 13 franchised dealerships in its U.S. Operations segment for expected aggregate proceeds of approximately $82.7 million which includes approximately $6.4 million for real estate. The transactions are subject to customary closing conditions, including OEM approvals, and are anticipated to close in the second half of 2025.
• On July 21, 2025, the Company announced that it has selected CarGurus as its preferred partner in Canada supporting digital marketing efforts.
• On July 29, 2025, the Company sold substantially all of the operating assets of Crystal Lake Chrysler Dodge Jeep Ram, located in Crystal Lake, Illinois, for cash consideration of $9.9 million plus closing adjustments. Crystal Lake Chrysler Dodge Jeep Ram was presented as held for sale in the U.S. Operations segment as at June 30, 2025.

Conference Call

A conference call to discuss the results for the three months ended June 30, 2025 will be held on August 13, 2025 at 4:00 pm Mountain (6:00 pm Eastern). To participate in the conference call, please dial 1-888-510-2154 approximately 10 minutes prior to the call.

This conference call will also be webcast live over the internet and can be accessed by all interested parties at the following URL: https://investors.autocan.ca/2025-q2-conference-call/.

MD&A and Financial Statements

Information included in this press release is a summary of results. It should be read in conjunction with AutoCanada’s Interim Consolidated Financial Statements (“Interim Financial Statements”) and Management’s Discussion and Analysis (“MD&A”) for the three-month period and six-month period ended June 30, 2025, which can be found on the Company’s website at www.autocan.ca or on www.sedarplus.ca.

All comparisons presented in this press release are between the three-month period ended June 30, 2025 and the three-month period ended June 30, 2024, unless otherwise indicated. Results are reported in Canadian dollars and have been rounded to the nearest thousand dollars, unless otherwise stated.

Condensed Interim Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

(in thousands of Canadian dollars except for share and per share amounts)

 Condensed Interim Consolidated Statements of Financial Position

(Unaudited)

(in thousands of Canadian dollars)

Condensed Interim Consolidated Statements of Cash Flows

(Unaudited)

(in thousands of Canadian dollars)

NON-GAAP AND OTHER FINANCIAL MEASURES

This press release contains certain financial measures that do not have any standardized meaning prescribed by GAAP. Therefore, these financial measures may not be comparable to similar measures presented by other issuers. Investors are cautioned these measures should not be construed as an alternative to net income (loss) or to cash provided by (used in) operating, investing, financing activities, cash, and indebtedness determined in accordance with GAAP, as indicators of our performance. We provide these additional non-GAAP measures (“Non-GAAP Measures”), capital management measures, and supplementary financial measures to assist investors in determining the Company’s ability to generate earnings and cash provided by (used in) operating activities and to provide additional information on how these cash resources are used.

Adjusted EBITDA, adjusted EBITDA margin, normalized operating expenses before depreciation, and normalized operating expenses before depreciation as a percentage of gross profit are not earnings measures recognized by GAAP and do not have standardized meanings prescribed by GAAP. Investors are cautioned that these Non-GAAP Measures should not replace net earnings or loss (as determined in accordance with GAAP) as an indicator of the Company’s performance, cash flows from operating, investing and financing activities or as a measure of liquidity and cash flows. The Company’s methods of calculating referenced Non-GAAP Measures may differ from the methods used by other issuers. Therefore, these measures may not be comparable to similar measures presented by other issuers.

We list and define these “NON-GAAP MEASURES” below:

Adjusted EBITDA

Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) is an indicator of a company’s operating performance over a period of time and ability to incur and service debt. Adjusted EBITDA provides an indication of the results generated by our principal business activities prior to:

• Interest expense (other than interest expense on floorplan financing), income taxes, depreciation, and amortization;
• Charges that introduce volatility unrelated to operating performance by virtue of the impact of external factors (such as share-based compensation amounts attributed to certain equity issuances as part of the Used Digital Division);
• Non-cash charges (such as impairment, recoveries, gains or losses on derivatives, revaluation of contingent consideration and revaluation of redemption liabilities);
• Charges outside the normal course of business (such as restructuring, gains and losses on dealership divestitures, and real estate transactions); and
• Charges that are non-recurring in nature (such as resolution of lawsuits and legal claims, and share-based compensation amounts attributable to certain equity issuances as part of the transformation plan).

The Company considers this measure meaningful as it provides improved continuity with respect to the comparison of our operating performance over a period of time.

Adjusted EBITDA Margin

Adjusted EBITDA margin is an indicator of a company’s operating performance specifically in relation to our revenue performance.

The Company considers this measure meaningful as it provides improved continuity with respect to the comparison of our operating performance with retaining and growing profitability as our revenue and scale changes over a period of time.

Normalized Operating Expenses (“Opex”) Before Depreciation

Normalized operating expenses before depreciation is an indicator of a company’s operating expense before depreciation over a period of time, normalized for the following items:

• Transaction costs related to acquisitions, dispositions, and open points;
• Software implementation costs associated with the configuration or customization of software as a service arrangement;
• Restructuring charges relate to non-recurring organizational changes to improve the Company’s profitability and overall efficiency;
• Management transition costs; and
• Share-based compensation expense.

The Company considers this measure meaningful as it provides a comparison of our operating expense normalized for transactions that are not indicative of the Company’s operating expenses over time.

Normalized Operating Expenses Before Depreciation as a Percentage of Gross Profit

Normalized operating expenses before depreciation as a percentage of gross profit is a measure of a company’s normalized operating expenses before depreciation over a period of time in relation to gross profit.

The Company considers this measure meaningful as it provides a comparison of our operating performance, normalized for transactions that are not indicative of the Company’s operating expenses, with our growing profitability as our gross profit and scale changes over a period of time.

NON-GAAP AND OTHER FINANCIAL MEASURES RECONCILIATIONS

Adjusted EBITDA and Segmented Adjusted EBITDA

The following table illustrates segmented adjusted EBITDA for the three-month periods ended June 30:

The following table illustrates segmented collision adjusted EBITDA from continuing operations for the three-months ended June 30. There is no discontinued operation in Collision Operations.

Adjusted EBITDA Margin

The following table illustrates segmented adjusted EBITDA margin from continuing operations for the three-month periods ended June 30:

Normalized Operating Expenses Before Depreciation and Normalized Operating Expenses Before Depreciation as a Percentage of Gross Profit

The following tables illustrate segmented normalized opex before depreciation and normalized opex before depreciation as a percentage of gross profit from continuing operations, for the three-month periods and six-month periods ended June 30:

Forward Looking Statements

Certain statements contained in this press release are forward-looking statements and information (collectively “forward-looking statements”), within the meaning of the applicable Canadian securities legislation. We hereby provide cautionary statements identifying important factors that could cause actual results to differ materially from those projected in these forward-looking statements. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions, or future events or performance (often, but not always, through the use of words or phrases such as “will likely result”, “are expected to”, “will continue”, “is anticipated”, “projection”, “vision”, “goals”, “objective”, “target”, “schedules”, “outlook”, “anticipate”, “expect”, “estimate”, “could”, “should”, “plan”, “seek”, “may”, “intend”, “likely”, “will”, “believe”, “shall” and similar expressions) and the financial outlook with respect to the transformation plan are not all historical facts and are forward-looking and may involve estimates and assumptions and are subject to risks, uncertainties and other factors some of which are beyond our control and difficult to predict.

Forward-looking statements and financial outlook in this press release include: AutoCanada’s future financial position, expected run-rate operational expense savings from the implementation of the ACX Operating Method, the expected aggregate proceeds from the U.S. dealership divestitures, the completion and the anticipated timing of completion of the U.S. dealership disposition transactions, engagement in selling the remaining dealerships of the U.S. Operations segment, and the impact of the U.S. dealership divestitures on the Company’s leverage ratio.

Forward-looking statements and financial outlook provide information about management’s expectations and plans for the future and may not be appropriate for other purposes. Forward looking statements and financial outlook are based on various assumptions, and expectations that AutoCanada believes are reasonable in the circumstances. No assurance can be given that these assumptions and expectations will prove correct. Those assumptions and expectations are based on information currently available to AutoCanada, including information obtained from third-party consultants and other third-party sources, and the historic performance of AutoCanada’s businesses. AutoCanada cautions that the assumptions used to prepare such forward-looking statements and financial outlook, including AutoCanada’s expected run-rate operational expense savings through the transformation plan, could prove to be incorrect or inaccurate.

In preparing the forward-looking statements and financial outlook, AutoCanada considered numerous economic, market and operational assumptions, including key assumptions listed under Section 3 Market and Financial Outlook of the MD&A.

The forward-looking statements and financial outlook are also subject to the risks and uncertainties set forth below. By their very nature, forward-looking statements and financial outlook involve numerous assumptions, risks and uncertainties, both general and specific. Should one or more of these risks and uncertainties materialize or should underlying assumptions prove incorrect, as many important factors are beyond our control, AutoCanada’s actual performance and financial results may vary materially from those estimates and expectations contemplated, expressed or implied in the forward-looking statements or financial outlook. These risks and uncertainties include risks relating to failure to realize expected cost-savings, cost overruns in one-time restructuring expenses, compliance with laws and regulations, reduced customer demand, operational risks, force majeure, labour relations matters, our ability to access external sources of debt and equity capital, and the risks identified in (i) the MD&A under Section 12 Risk Factors and (ii) AutoCanada’s most recent Annual Information Form (the “AIF”). The preceding list of assumptions, risks and uncertainties is not exhaustive.

Accordingly, these factors could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements and financial outlook. Therefore, any such forward-looking statements and financial outlook are qualified in their entirety by reference to the factors discussed throughout this press release and in the MD&A.

Details of the Company’s material forward-looking statements and financial outlook are included in the Company’s most recent AIF. The AIF and other documents filed with securities regulatory authorities (accessible through the SEDAR+ website (www.sedarplus.ca) describe the risks, material assumptions, and other factors that could influence actual results and which are incorporated herein by reference.

When relying on our forward-looking statements and financial outlook to make decisions with respect to AutoCanada, investors and others should carefully consider the preceding factors, other uncertainties and potential events. Any forward-looking statements and financial outlook are provided as of the date of this press release and, except as required by law, AutoCanada does not undertake to update or revise such statements to reflect new information, subsequent or otherwise. For the reasons set forth above, investors should not place undue reliance on forward-looking statements or financial outlook.

About AutoCanada

AutoCanada’s Canadian Operations segment, as of June 30, 2025, operates 64 franchised dealerships in Canada, comprised of 23 brands, in 8 provinces. AutoCanada currently sells Acura, Audi, BMW, Buick, Cadillac, Chevrolet, Chrysler, Dodge, Ford, GMC, Honda, Hyundai, Infiniti, Jeep, Kia, Mazda, Mercedes-Benz, MINI, Nissan, Porsche, Ram, Subaru, and Volkswagen branded vehicles. In addition, AutoCanada’s Canadian Operations segment currently operates 3 independent used dealerships dealerships (“Used Vehicle Operations”) and 14 stand-alone collision centres within our group of 30 collision centres (“Collision Centres”). In 2024, our Canadian dealerships sold approximately 85,000 new and used retail vehicles. In addition, our Collision Centres offer an opportunity for the Company to retain customers at every touchpoint within the automotive ecosystem.

AutoCanada’s U.S. Operations segment, operating as Leader Automotive Group (“Leader”), operates 17 franchised dealerships comprised of 15 brands, in Illinois, USA. Leader currently sells Audi, Chevrolet, Chrysler, Dodge, Honda, Hyundai, Jeep, Kia, Lincoln, Mercedes-Benz, Porsche, Ram, Subaru, Toyota, and Volkswagen branded vehicles. In 2024, our U.S. dealerships sold approximately 12,900 new and used retail vehicles.

Additional Information

Additional information about AutoCanada is available at the Company’s website at www.autocan.ca and on the SEDAR+ website at www.sedarplus.ca.

SOURCE AutoCanada Inc.