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| Statement |
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| And that's a really healthy margin service for us |
| We continue to be pleased by the performance of our Take 5 Oil Change and franchise businesses, all being key contributors to fiscal year 2023 growth |
| All I will tell you is that, Tracy and the team in Europe have done an exceptional job over the last three years in terms of managing that business |
| And our Paint, Collision & Glass segment, we achieve positive same store sales of 6.4% representing 11 straight quarters of same store sales growth |
| So you've seen at the top end of the range, higher price points, I think that it's important that we have a solid barbell strategy when it comes to pricing so that we've got the right entry level pricing that will drive trial and acquisition, which is obviously the feeder for getting people to become members |
| So the team has done a nice job driving that and will continue to drive that through 2025 |
| Some additional highlights for Driven in 2023 include building out our US Glass platform and strong performance from our asset light high margin franchise businesses |
| Additionally, our fleet team delivered our best every year with approximately $470 million of system wide sales |
| I think the path forward looks really good |
| So very excited that the team can actually focus now on growing the business into 2024 |
| We are pleased with the same store sales growth of 4.7% and maintenance our largest segment, revenue from this segment grew 8.9% over the prior year period |
| The headline is that we improved margins from approximately 17% in Q3 to over 23% in Q4 |
| This was primarily driven by our Take 5 Oil Change business which continues to perform strongly across both our franchise and company owned locations |
| Jonathan Fitzpatrick Yeah, Chris is Jonathan, I'll take a shot at that, look, we're pleased with the progress the sequential progress at a segment level from 17% to north of 23 in Q3 to Q4, as we think about 2024, at a minimum, we'd expect to sort of hold on to that sort of 23%, consolidated margin |
| Maintenance segment adjusted EBITDA margin increased by over 140 basis points versus Q4 2022 due to flow through from strong top line performance as well as continued focus on operational efficiency |
| Additionally, the team is making good progress on divesting any pipeline properties we owned when we made this decision |
| We successfully grew our segment adjusted EBITDA margins by over 600 basis points sequentially, with most of the improvement coming from our US business, mostly due to our continued focus on detergent costs and labor |
| So obviously that business continues to perform very strongly |
| Take 5 Oil Change system wide sales grew by 26% year-over-year, driven by 14% same store sales and 18% unit growth |
| In conclusion, we have a platform that generates high steady state returns with a long runway for reinvestment at exceptional returns |
| So Mo and the team have done a really nice job with that |
| I am pleased to say that we met or exceeded all the financial metrics that we provided in an updated 2023 outlook |
| For some time now we've been delivering successfully growing that PEMIX into the upper end of the spectrum |
| Businesses like Take 5 Oil Change, Auto Glass Now and platforms like Driven Advantage are managed to deliver accelerated growth in terms of revenue, adjusted EBITDA, and new units |
| Cash businesses, like Meineke, Maaco, CARSTAR and 1-800-Radiator managed to deliver strong margins and cash flow |
| The range also reflects various rates of improvement in our US Car Wash and US Glass operations throughout the year |
| In 2023 each of these businesses delivered positive revenue and double-digit adjusted EBITDA growth |
| So we feel really good about the fact that number one, we're growing comps, and number two, that we have the healthy balance in that growth via both car count and check size |
| Take 5 Oil Change has delivered positive same store sales growth for 14 quarters in a row by delivering fast, friendly and simple oil changes with a net promoter score in the upper 70s |
| We also remain poised to continue to grow Take 5 Oil Change by over 150 units per year for the foreseeable future, with a majority of those sites being asset light franchise locations |
| Statement |
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| In our Car Wash segment, we experienced the same store sales decline of 3.3% versus the prior year period |
| The Car Wash segment adjusted EBITDA margin decreased to 23.2% in the quarter from 26.9% in Q4 2022, resulting in segment adjusted EBITDA of $30.8 million |
| Although we continue to see softer retail volumes in the US, particularly in January due to the winter storms and freezing temperatures across the country |
| January was a challenging month with sales been impacted by multiple storms, flooding and freezing temperatures across many of our markets |
| Segment adjusted EBITDA margin was 27% versus 28.2% in Q4 2022, resulting in a $2.9 million decline in adjusted EBITDA |
| Platform Services segment adjusted EBITDA was $18.6 million margin decreased to 36.7% from 37.6% in Q4 2022, due to a positive one time item in the prior year period |
| And we estimate this could negatively impact performance in Q1 |
| We delivered adjusted net income of $155.9 million and adjusted diluted EPS of $0.93, which were down 25% and 23.8% year-over-year respectively |
| This decline is directly attributable to our US Glass business where we were working through the operational challenges that Danny previously mentioned |
| Adjusted EBITDA margin was 23.2% approximately 200 basis points below the prior year, primarily driven by US Car Wash store growth and increased rent from sale leaseback related to that store growth, as well as the impact of working through the integration of multiple US Glass acquisitions |
| And then just on the 850 EBITDA target, maybe you can put some context around the straight line rent adjustment, does that make it harder to reach the target? And it sounds like the guidance for this year is a little bit below what you thought because of some divestiture |
| This decline was driven by our US Car Wash operations, total segment revenue decreased 1% |
| At the bottom end of our outlook reflects potential impacts from macro economic uncertainty and weather |
| Down 87 basis points versus last year primarily due to our US Car Wash and US Glass businesses |
| We expect adjusted EBITDA to peak in Q2 and then decline sequentially throughout the remainder of the year |
| Adjusted EBITDA was $129 million down slightly versus $130 million in the same quarter last year |
| This is significantly lower than FY22, primarily due to the impact of the goodwill impairment recorded in Q3 of FY23 |
| Additionally, as Jonathan mentioned earlier, we had major storms impacting large swaths of the country in January |
| But it did slow rather meaningfully, sequentially from Q3 at 14 |
| So really, the majority of that slowdown was just lapping over price increases that we took Q4 of 2022 |
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