Avis Budget Group Reports Record Net Income and Adjusted EBITDA

PARSIPPANY, N.J., Aug. 03, 2021 (GLOBE NEWSWIRE) -- Avis Budget Group, Inc. (NASDAQ: CAR) today announced second quarter 2021 financial results.

We ended the second quarter with revenues up more than three times prior year and 1% above second quarter 2019, at $2.4 billion. Our revenues were driven by increased revenue per day compared to second quarter 2020, which represented the depths of the pandemic. Rental days also increased compared to prior year as demand continues to normalize.

Net income was $398 million and our Adjusted EBITDA was $624 million, increasing more than three times second quarter 2019, making it our best quarterly Adjusted EBITDA in our Company's 75 year history. Additionally, our utilization in the quarter was 71.3% and showed continuous improvement as the quarter progressed ensuring our fleet was well positioned to meet increased levels of demand.

Our liquidity position at the end of the quarter was approximately $1.8 billion with an additional $3.4 billion of fleet funding capacity. We have well-laddered corporate debt and renewed our credit facility in July. We now have no meaningful maturities until 2024.

“This is the best quarter result in our Company's history and a validation of all the hard work our team has put in since the pandemic began.” said Joe Ferraro, Avis Budget Group Chief Executive Officer. “The momentum we saw in the second quarter is expected to continue through the summer and our team will be ready to take advantage of increased demand while maintaining rigorous cost discipline.”

Q2 Highlights

  • Total Company revenues were up 212% compared to second quarter 2020 and up 1% compared to 2019.
  • Adjusted EBITDA in the Americas was $634 million for second quarter 2021 driven by continued sequential revenue growth and sustained cost discipline.
  • Adjusted EBITDA in International was $8 million for second quarter 2021 driven by strong cost mitigating actions to match demand as International recovery continues.
  • We issued $800 million asset-backed notes incurring our lowest ever interest at a weighted average rate of 1.73%.

Investor Conference Call

We will host a conference call to discuss second quarter results on August 4, 2021, at 8:30 a.m. (ET). Investors may access the call at ir.avisbudgetgroup.com or by dialing (877) 407-2991 and a replay will available on our website and at (877) 660-6853 using conference code 13721250.

About Avis Budget Group

Avis Budget Group, Inc. is a leading global provider of mobility solutions, both through its Avis and Budget brands, which have more than 10,000 rental locations in approximately 180 countries around the world, and through its Zipcar brand, which is the world's leading car sharing network with more than one million members. Avis Budget Group operates most of its car rental offices in North America, Europe and Australasia directly, and operates primarily through licensees in other parts of the world. Avis Budget Group is headquartered in Parsippany, N.J. More information is available at avisbudgetgroup.com.

Forward-Looking Statements

Certain statements in this press release constitute “forward-looking statements.” Any statements that refer to outlook, expectations or other characterizations of future events, circumstances or results, including all statements related to our future results, impact from the COVID-19 outbreak, cost-saving actions, the global semiconductor shortage and cash flows are forward-looking statements. Various risks that could cause future results to differ from those expressed by the forward-looking statements included in this press release include, but are not limited to, the severity and duration of the COVID-19 outbreak, which is expected to continue to have a significant impact on our operations, and resulting economic conditions and related restrictions, the high level of competition in the mobility industry, changes in our fleet costs, including as a result of a change in the cost of new vehicles, manufacturer recalls and/or the value of used vehicles, disruption in the supply of new vehicles, disposition of vehicles not covered by manufacturer repurchase programs, our ability to realize our estimated cost savings on a timely basis, or at all, the financial condition of the manufacturers that supply our rental vehicles, including as a result of the global semiconductor shortage, which could affect their ability to perform their obligations under our repurchase and/or guaranteed depreciation arrangements, the significant decline in travel demand as a result of COVID-19, including the current and any further disruptions in airline passenger traffic, the absence of an improvement in or any further deterioration in economic conditions generally, particularly during our peak season and/or in key market segments, any occurrence or threat of terrorism, the current and any future pandemic diseases or other natural disasters, any changes to the cost or supply of fuel, risks related to acquisitions or integration of acquired businesses, risks associated with litigation, governmental or regulatory inquiries or investigations, risks related to the security of our information technology systems, disruptions in our communication networks, changes in tax or other regulations, a significant increase in interest rates or borrowing costs, our ability to obtain financing for our global operations, including the funding of our vehicle fleet via asset-backed securities markets, any fluctuations related to the mark-to-market of derivatives which hedge our exposure to exchange rates, interest rates and fuel costs, our ability to meet the covenants contained in the agreements governing our indebtedness, and our ability to accurately estimate our future results and implement our cost savings actions. Other unknown or unpredictable factors could also have material adverse effects on the Company’s performance or achievements. Important assumptions and other important factors that could cause actual results to differ materially from those in the forward-looking statements are specified in Avis Budget Group’s Annual Report on Form 10-K for the year ended December 31, 2020, Quarterly Report on Form 10-Q for the three months ended March 31, 2021 and in other filings and furnishings made by the Company with the Securities and Exchange Commission (the "SEC") from time to time. The Company undertakes no obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances.

Non-GAAP Financial Measures and Key Metrics

This release includes financial measures such as Adjusted EBITDA, Adjusted net income and Adjusted free cash flow, as well as other financial measures that are not considered generally accepted accounting principles (“GAAP”) measures as defined under SEC rules. Important information regarding such measures is contained in the financial tables to this release and in Appendix I, including the definitions of these measures and reconciliations to the closest comparable GAAP measures. The Company and its management believe that these non-GAAP measures are useful to investors in measuring the comparable results of the Company period-over-period. The GAAP measures most directly comparable to Adjusted EBITDA, Adjusted free cash flow, Adjusted pretax income (loss), Adjusted net income (loss) and Adjusted diluted earnings (loss) per share are net income (loss), net cash provided by operating activities, income (loss) before income taxes, net income (loss) and diluted earnings (loss) per share, respectively. Foreign currency translation effects on the Company’s results are quantified by translating the current period’s non-U.S. dollar-denominated results using the currency exchange rates of the prior period of comparison including any related gains and losses on currency hedges. Per-unit fleet costs, which represent vehicle depreciation, lease charges and gain or loss on vehicle sales, divided by average rental fleet, are calculated on a per-month basis.

Contact
David Calabria
IR@avisbudget.com
PR@avisbudget.com

Tables Follow

Table 1

Avis Budget Group, Inc.
SUMMARY DATA SHEET
(In millions, except per share data)

    
 Three Months Ended June 30, Six Months Ended June 30,
 2021 2020 % Change 2021 2020 % Change
Income Statement and Other Items           
Revenues$2,371 $760  212% $3,743 $2,513  49%
Income (loss) before income taxes486 (609) 180% 236 (874) 127%
Net income (loss)398 (481) 183% 228 (639) 136%
Earnings (loss) per share - diluted5.63 (6.91) 181% 3.23 (8.96) 136%
            
Adjusted Earnings Measures (non-GAAP) (A)           
Adjusted EBITDA624 (382) 263% 671 (469) 243%
Adjusted pretax income (loss)512 (488) 205% 448 (679) 166%
Adjusted net income (loss)417 (388) 207% 385 (491) 178%
Adjusted earnings (loss) per share - diluted5.90 (5.60) 205% 5.45 (6.90) 179%
            
 As of        
 June 30, 2021 December 31, 2020        
Balance Sheet Items           
Cash and Cash Equivalents$1,324 $692         
Vehicles, net11,728 8,153         
Debt under vehicle programs10,408 6,857         
Corporate debt4,298 4,210         
Stockholders' equity92 (155)        
             


            
Segment Results           
 Three Months Ended June 30, Six Months Ended June 30,
 2021 2020 % Change 2021 2020 % Change
Revenues           
Americas$1,974  $565  249% $3,054  $1,822  68%
International397  195  104% 689  691  %
Corporate and Other    n/m     n/m
Total Company$2,371  $760  212% $3,743  $2,513  49%
            
Adjusted EBITDA           
Americas$634  $(233) 372% $742  $(263) 382%
International8  (140) 106% (42) (180) 77%
Corporate and Other(18) (9) n/m (29) (26) n/m
Total Company$624  $(382) 263% $671  $(469) 243%
            


_______
n/mNot meaningful.
(A)See Table 5 for reconciliations of non-GAAP measures and Appendix I for definitions.
  

Table 2

Avis Budget Group, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)

    
 Three Months Ended June 30, Six Months Ended June 30,
 2021 2020 2021 2020
Revenues$2,371 $760  $3,743 $2,513 
        
Expenses       
Operating1,032 622  1,864 1,680 
Vehicle depreciation and lease charges, net338 374  592 833 
Selling, general and administrative294 132  476 383 
Vehicle interest, net77 87  152 170 
Non-vehicle related depreciation and amortization62 71  130 140 
Interest expense related to corporate debt, net:       
Interest expense59 51  120 99 
Early extinguishment of debt 3  129 7 
Restructuring and other related charges22 28  42 72 
Transaction-related costs, net1 1  2 3 
Total expenses1,885 1,369  3,507 3,387 
        
Income (loss) before income taxes486 (609) 236 (874)
Provision for (benefit from) income taxes88 (128) 8 (235)
Net income (loss)$398 $(481) $228 $(639)
        
Earnings (loss) per share - diluted       
Basic$5.69 $(6.91) $3.26 $(8.96)
Diluted$5.63 $(6.91) $3.23 $(8.96)
        
Weighted average shares outstanding       
Basic69.9 69.6  69.9 71.3 
Diluted70.6 69.6  70.6 71.3 
        

Table 3

Avis Budget Group, Inc.
KEY METRICS SUMMARY

 Three Months Ended June 30, Six Months Ended June 30,
 2021 2020 % Change 2021 2020 % Change
            
Americas           
            
Rental Days (000’s)24,910  11,968  108 % 42,931  35,425  21 %
Revenue per Day, excluding exchange rate effects (A)$79.08  $47.16  68 % $70.99  $51.42  38 %
Average Rental Fleet377,987  399,083  (5)% 336,310  408,010  (18)%
Vehicle Utilization72.4% 33.0% 39.4 pps 70.5% 47.7% 22.8 pps
Per-Unit Fleet Costs per Month, excluding exchange rate effects (A)$228  $225  1 % $219  $246  (11)%
            
International           
            
Rental Days (000’s)8,135  6,024  35 % 14,960  17,092  (12)%
Revenue per Day, excluding exchange rate effects (A)$43.69  $32.46  35 % $41.43  $40.43  2 %
Average Rental Fleet131,416  164,360  (20)% 124,443  178,558  (30)%
Vehicle Utilization68.0% 40.3% 27.7 pps 66.4% 52.6% 13.8 pps
Per-Unit Fleet Costs per Month, excluding exchange rate effects (A)$181  $212  (15)% $182  $216  (16)%
            
Total           
            
Rental Days (000’s)33,045  17,992  84 % 57,891  52,517  10 %
Revenue per Day, excluding exchange rate effects (A)$70.37  $42.24  67 % $63.35  $47.84  32 %
Average Rental Fleet509,403  563,443  (10)% 460,753  586,568  (21)%
Vehicle Utilization71.3% 35.1% 36.2 pps 69.4% 49.2% 20.2 pps
Per-Unit Fleet Costs per Month, excluding exchange rate effects (A)$216  $221  (2)% $209  $237  (12)%
_______      
Refer to Table 6 for key metrics calculations and Appendix I for key metrics definitions.  
The following metrics include changes in currency exchange rates:  
            
 Three Months Ended June 30, Six Months Ended June 30,
 2021 2020 % Change 2021 2020 % Change
            
Americas           
            
Revenue per Day$79.26  $47.16  68 % $71.14  $51.42  38 %
Per-Unit Fleet Costs per Month$229  $225  2 % $219  $246  (11)%
            
International           
            
Revenue per Day$48.72  $32.46  50 % $46.06  $40.43  14 %
Per-Unit Fleet Costs per Month$200  $212  (6)% $199  $216  (8)%
            
Total           
            
Revenue per Day$71.74  $42.24  70 % $64.66  $47.84  35 %
Per-Unit Fleet Costs per Month$221  $221  0 % $214  $237  (10)%
                        
                        

Table 4

Avis Budget Group, Inc.
CONSOLIDATED CONDENSED SCHEDULES OF CASH FLOWS AND ADJUSTED FREE CASH FLOWS
(In millions)

CONSOLIDATED CONDENSED SCHEDULE OF CASH FLOWS

 Six Months Ended June 30, 2021
Operating Activities 
Net cash provided by operating activities$1,255 
  
Investing Activities 
Net cash used in investing activities exclusive of vehicle programs$(38)
Net cash used in investing activities of vehicle programs(3,997)
Net cash used in investing activities$(4,035)
  
Financing Activities 
Net cash used in financing activities exclusive of vehicle programs$(39)
Net cash provided by financing activities of vehicle programs3,469 
Net cash provided by financing activities$3,430 
  
Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash(4)
Net change in cash and cash equivalents, program and restricted cash646 
Cash and cash equivalents, program and restricted cash, beginning of period (A)765 
Cash and cash equivalents, program and restricted cash, end of period (B)$1,411 
    
    

CONSOLIDATED SCHEDULE OF ADJUSTED FREE CASH FLOWS (C)

  
 Six Months Ended June 30, 2021
Income before income taxes$236 
Add-back of non-vehicle related depreciation and amortization (D)135 
Add-back of debt extinguishment costs129 
Add-back of restructuring and other related costs42 
Add-back of transaction-related costs, net2 
Add-back of COVID-19 charges18 
Add-back of unprecedented personal-injury and other legal matters, net(11)
Working capital and other344 
Capital expenditures (E)(52)
Tax payments, net of refunds(50)
Vehicle programs and related (F)(26)
Adjusted free cash flow$767 
  
Acquisition and related payments, net of acquired cash$(5)
Borrowings, net of debt repayments(3)
Restructuring and other related payments(20)
Transaction-related payments(2)
COVID-19 payments, net(54)
Unprecedented personal-injury and other legal matter payments, net(8)
Repurchases of common stock(22)
Change in program cash14 
Change in restricted cash2 
Foreign exchange effects, financing costs and other(23)
Net change in cash and cash equivalents, program and restricted cash (per above)$646 


 
 


RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW

  
 Six Months Ended June 30, 2021
Net cash provided by operating activities (per above)$1,255 
Investing activities of vehicle programs(3,997)
Financing activities of vehicle programs3,469 
Capital expenditures(30)
Proceeds received on sale of assets and nonmarketable equity securities2 
Change in program cash(14)
Change in restricted cash(2)
COVID-19 payments, net54 
Restructuring and other related payments20 
Unprecedented personal-injury and other legal matter payments, net8 
Transaction-related payments2 
Adjusted free cash flow (per above)$767 


 _______
(A)Consists of cash and cash equivalents of $692 million, program cash of $72 million and restricted cash of $1 million.
(B)Consists of cash and cash equivalents of $1.3 billion, program cash of $84 million and restricted cash of $3 million.
(C)See Appendix I for the definition of Adjusted free cash flow.
(D)Includes $5 million of cloud computing costs.
(E)Includes $22 million of cloud computing implementation costs.
(F)Includes vehicle-backed borrowings (repayments) that are incremental to amounts required to fund incremental (reduced) vehicle and vehicle-related assets.
  

Table 5

Avis Budget Group, Inc.
DEFINITIONS AND RECONCILIATIONS OF NON-GAAP MEASURES
(In millions, except per share data)

The accompanying press release includes certain non-GAAP (generally accepted accounting principles) financial measures as defined under SEC rules. To the extent not provided in the press release or accompanying tables, we have provided the reasons we present these non-GAAP financial measures and a description of what they represent in Appendix I. For each non-GAAP financial measure a reconciliation to the most comparable GAAP financial measure is calculated and presented below with reconciliations of net income (loss), income (loss) before income taxes and diluted earnings (loss) per share to Adjusted EBITDA and our Adjusted earnings measures.

 Three Months Ended June 30, Six Months Ended June 30,
Reconciliation of net income (loss) to Adjusted EBITDA:2021 2020 2021 2020
        
Net income (loss)$398  $(481) $228  $(639)
Provision for (benefit from) income taxes88  (128) 8  (235)
Income (loss) before income taxes486  (609) 236  (874)
        
Add certain items:       
Early extinguishment of debt  3  129  7 
Restructuring and other related charges22  28  42  72 
Acquisition-related amortization expense14  16  32  29 
COVID-19 charges (A)  73  18  80 
Transaction-related costs, net1  1  2  3 
Non-operational charges related to shareholder activist activity (B)      4 
Unprecedented personal-injury and other legal matters, net (C)(11)   (11)  
Adjusted pretax income (loss)512  (488) 448  (679
)
Add:       
Non-vehicle related depreciation and amortization (excluding acquisition-related amortization expense) (D)53  55  103  111 
Interest expense related to corporate debt, net (excluding early extinguishment of debt)59  51  120  99 
Adjusted EBITDA$624  $(382) $671  $(469)
        
Reconciliation of net income (loss) to adjusted net income (loss):       
        
Net income (loss)398   (481) 228   (639)
Add certain items, net of tax:       
Early extinguishment of debt  3  96  6 
Restructuring and other related charges16  22  31  55 
Acquisition-related amortization expense11  12  24  22 
COVID-19 charges  55  13  60 
Transaction-related costs, net  1  1  2 
Non-operational charges related to shareholder activist activity      3 
Unprecedented personal-injury and other legal matters, net(8)   (8)  
Adjusted net income (loss)$417  $(388) $385  $(491)
        
Earnings (loss) per share - Diluted$5.63  $(6.91) $3.23  $(8.96)
        
Adjusted diluted earnings (loss) per share$5.90  $(5.60) $5.45  $(6.90)
        
Shares used to calculate Adjusted diluted earnings (loss) per share70.6  69.6  70.6
  71.3
 


_______       
(A)The following table presents the unusual, direct and incremental costs due to the COVID-19 pandemic.
  Three Months Ended June 30, Six Months Ended June 30,
  2021 2020 2021 2020
 Minimum Annual guaranteed rent in excess of concession fees, net$(3) $30 $16  $30
 Vehicles damaged in overflow parking lots, net of insurance proceeds2  28 (4) 33
 Incremental cleaning supplies to sanitize vehicles and facilities, and over flow parking for idle vehicles  15   17
 Other charges1   6  
 Operating expenses$  $72 $17  $79
 Selling, general and administrative expenses$  $1 $1  $1
(B)Reported within selling, general and administrative expenses in our Consolidated Statements of Operations.
(C)Reported within operating expenses in our Consolidated Statements of Operations.
(D)For the three and six months ended June 30, 2021 consists of $3 million within operating expenses and $2 million within selling, general and administrative expenses in our Consolidated Statements of Operations related to cloud computing costs.
  

Table 6

Avis Budget Group, Inc.
KEY METRICS CALCULATIONS
($ in millions, except as noted)

 Three Months Ended June 30, 2021 Three Months Ended June 30, 2020
 Americas International Total Americas International Total
Revenue per Day (RPD)           
Revenue$1,974   $397   $2,371   $565  $195  $760 
Currency exchange rate effects(4)  (41)  (45)       
Revenue excluding exchange rate effects$1,970   $356   $2,326   $565  $195  $760 
Rental days (000's)24,910   8,135   33,045   11,968  6,024  17,992 
RPD excluding exchange rate effects
(in $'s)
$79.08   $43.69   $70.37   $47.16  $32.46  $42.24 
            
Vehicle Utilization           
Rental days (000's)24,910   8,135   33,045   11,968  6,024  17,992 
Average rental fleet377,987   131,416   509,403   399,083  164,360  563,443 
Number of days in period91   91   91   91  91  91 
Available rental days (000's)34,397   11,959   46,356   36,316  14,957  51,273 
Vehicle utilization72.4 % 68.0 % 71.3 % 33.0% 40.3% 35.1%
            
Per-Unit Fleet Costs           
Vehicle depreciation and lease charges, net$259   $79   $338   $269  $105  $374 
Currency exchange rate effects(1)  (8)  (9)       
 $258   $71   $329   $269  $105  $374 
Average rental fleet377,987   131,416   509,403   399,083  164,360  563,443 
Per-unit fleet costs (in $'s)$683   $542   $647   $675  $637  $664 
Number of months in period3   3   3   3  3  3 
Per-unit fleet costs per month excluding exchange rate effects (in $'s)$228   $181   $216   $225  $212  $221 


    
    
 Six Months Ended June 30, 2021 Six Months Ended June 30, 2020
 Americas International Total Americas International Total
Revenue per Day (RPD)           
Revenue$3,054    $689    $3,743    $1,822   $691   $2,513  
Currency exchange rate effects(6)  (69)  (75)  —   —   —  
Revenue excluding exchange rate effects$3,048    $620    $3,668    $1,822   $691   $2,513  
Rental days (000's)42,931    14,960    57,891    35,425   17,092   52,517  
RPD excluding exchange rate effects
(in $'s)
$70.99    $41.43    $63.35    $51.42   $40.43   $47.84  
            
Vehicle Utilization           
Rental days (000's)42,931    14,960    57,891    35,425   17,092   52,517  
Average rental fleet336,310    124,443    460,753    408,010   178,558   586,568  
Number of days in period181    181    181    182   182   182  
Available rental days (000's)60,872    22,524    83,396    74,258   32,497   106,755  
Vehicle utilization70.5  % 66.4  % 69.4  % 47.7 % 52.6 % 49.2 %
            
Per-Unit Fleet Costs           
Vehicle depreciation and lease charges, net$443    $149    $592    $601   $232   $833  
Currency exchange rate effects(2)  (13)  (15)  —   —   —  
 $441    $136    $577    $601   $232   $833  
Average rental fleet336,310    124,443    460,753    408,010   178,558   586,568  
Per-unit fleet costs (in $'s)$1,312    $1,091    $1,252    $1,474   $1,297   $1,420  
Number of months in period              
Per-unit fleet costs per month excluding exchange rate effects (in $'s)$219    $182    $209    $246   $216   $237  


_______   
Our calculation of rental days and revenue per day may not be comparable to the calculation of similarly-titled metrics by other companies. Currency exchange rate effects are calculated by translating the current-year results at the prior-period average exchange rates plus any related gains and losses on currency hedges.
 

Appendix I

Avis Budget Group, Inc.
DEFINITIONS OF NON-GAAP MEASURES AND KEY METRICS

Adjusted EBITDA
The accompanying press release presents Adjusted EBITDA, which represents income (loss) from continuing operations before non-vehicle related depreciation and amortization, any impairment charges, restructuring and other related charges, early extinguishment of debt costs, non-vehicle related interest, transaction-related costs, net, charges for unprecedented personal-injury and other legal matters, net, non-operational charges related to shareholder activist activity, which include third party advisory, legal and other professional service fees, gain on sale of equity method investment in China, COVID-19 charges and income taxes. COVID-19 charges include unusual, direct and incremental costs due to the COVID-19 pandemic such as minimum annual guaranteed rent in excess of concession fees for the period, overflow parking for idle vehicles and related shuttling costs, incremental cleaning supplies to sanitize vehicles and facilities, and losses associated with vehicles damaged in overflow parking lots, net of insurance proceeds. Adjusted EBITDA includes stock-based compensation expense and deferred financing fee amortization totaling $16 million and $9 million in second quarter 2021 and 2020, respectively, and totaling $25 million and $13 million in the six months ended ended June 30, 2021 and 2020, respectively.

We believe that Adjusted EBITDA is useful to investors as a supplemental measure in evaluating the aggregate performance of our operating businesses and in comparing our results from period to period. Adjusted EBITDA is the measure that is used by our management, including our chief operating decision maker, to perform such evaluation. Adjusted EBITDA is also a component in the determination of management's compensation. Adjusted EBITDA should not be considered in isolation or as a substitute for net income or other income statement data prepared in accordance with GAAP and our presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies. A reconciliation of Adjusted EBITDA from net income (loss) recognized under GAAP is provided on Table 5.

Adjusted Earnings Non-GAAP Measures
The accompanying press release and tables present Adjusted pretax income (loss), Adjusted net income (loss) and Adjusted diluted earnings (loss) per share, which exclude certain items. We believe that these measures referred to above are useful to investors as supplemental measures in evaluating the aggregate performance of the Company. We exclude restructuring and other related charges, transaction-related costs, costs related to early extinguishment of debt and certain other items as such items are not representative of the results of operations of our business less a provision for income taxes derived utilizing applicable statutory tax rates for each item. A reconciliation of our Adjusted earnings Non-GAAP measures from the appropriate measures recognized under GAAP is provided on Table 5.

Adjusted Free Cash Flow
Represents Net Cash Provided by Operating Activities adjusted to reflect the cash inflows and outflows relating to capital expenditures, the investing and financing activities of our vehicle programs, asset sales, if any, and to exclude debt extinguishment costs, transaction-related costs, restructuring and other related charges, COVID-19 charges and non-operational charges related to shareholder activist activity. We have revised our definition of Adjusted Free Cash Flow to exclude COVID-19 charges and have not revised prior years' Adjusted Free Cash Flow amounts as there were no other charges similar in nature to these. We believe this change is meaningful to investors as it brings the measurement in line with our other non-GAAP measures. We believe that Adjusted Free Cash Flow is useful to management and investors in measuring the cash generated that is available to be used to repay debt obligations, repurchase stock, pay dividends and invest in future growth through new business development activities or acquisitions. Adjusted Free Cash Flow should not be construed as a substitute in measuring operating results or liquidity, and our presentation of Adjusted Free Cash Flow may not be comparable to similarly-titled measures used by other companies. A reconciliation of Adjusted Free Cash Flow to the appropriate measure recognized under GAAP is provided on Table 4.

Adjusted EBITDA Margin
Represents Adjusted EBITDA as a percentage of revenues.

Available Rental Days
Defined as Average Rental Fleet times the numbers of days in a given period.

Average Rental Fleet
Represents the average number of vehicles in our fleet during a given period of time.

Currency Exchange Rate Effects
Represents the difference between current-period results as reported and current-period results translated at the prior-period average exchange rates plus any related currency hedges.

Net Corporate Debt
Represents corporate debt minus cash and cash equivalents.

Net Corporate Leverage
Represents Net Corporate Debt divided by Adjusted EBITDA for the twelve months prior to the date of calculation.

Per-Unit Fleet Costs
Represents vehicle depreciation, lease charges and gain or loss on vehicles sales, divided by Average Rental Fleet.

Rental Days
Represents the total number of days (or portion thereof) a vehicle was rented during a 24-hour period.

Revenue per Day
Represents revenues divided by Rental Days.

Vehicle Utilization
Represents Rental Days divided by Available Rental Days.


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