EDMONTON, AB, Sept. 24, 2024 /CNW/ - AutoCanada Inc. ("AutoCanada" or the "Company") (TSX: ACQ), a leader in Canadian automotive retail, today announced the restructuring of its RightRide operations, including the closure of several underperforming locations within RightRide. This decision is part of a larger strategic shift to optimize operations and reduce leverage.
As part of this initiative, AutoCanada has closed seven unprofitable locations, while maintaining a select number of performing RightRide stores. The remaining locations have been shifted to an inventory-light business model and re-focused on the original strategy to provide credit solutions to credit challenged used light vehicle customers. This realignment is expected to strengthen the Company's position in the market and return RightRide to profitability.
"To position our business for sustained profitability, we have made the difficult decision to close select underperforming RightRide stores," said Paul Antony, Executive Chairman. "By focusing on our profitable locations and returning to our original strategy, we are confident that the operational efficiency and profitability of our remaining stores will improve."
Financial Highlights
Discontinued RightRide operations generated $34.9 million in sales during the trailing 12-month period ending June 30, 2024. Closure of these locations is expected to be immediately accretive to Adjusted EBITDA and earnings per share.
About AutoCanada
AutoCanada is a leading North American multi-location automobile dealership group currently operating 83 franchised dealerships, comprised of 28 brands, in eight provinces in Canada as well as a group in Illinois, USA. AutoCanada currently sells Acura, Alfa Romeo, Audi, BMW, Buick, Cadillac, Chevrolet, Chrysler, Dodge, FIAT, Ford, GMC, Honda, Hyundai, Infiniti, Jeep, Kia, Lincoln, Mazda, Mercedes-Benz, MINI, Nissan, Porsche, Ram, Subaru, Toyota, Volkswagen, and Volvo branded vehicles. In addition, AutoCanada's Canadian Operations segment currently operates 11 stand-alone collision centres within our group of 27 collision centres. In 2023, the Company generated revenue in excess of $6 billion and our dealerships sold over 100,000 retail vehicles.
Additional Information
Additional information about AutoCanada is available at the Company's website at www.autocan.ca and www.sedarplus.ca.
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 our actual results to differ materially from those identified 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" and similar expressions) are not historical facts and are forward looking. In particular, this press release contains forward-looking statements with respect to, among other things, our strategic shift to optimize operations and reduce leverage, the impact of the restructuring on the Company's position in the market and RightRide's operational efficiency and profitability, and the impact of the restructuring on Adjusted EBITDA margin and earnings per share.
AutoCanada cautions that the foregoing forward-looking statements are subject to assumptions, risks and uncertainties and our ability to mitigate and address those risks and uncertainties. The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website at www.sedarplus.ca) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference. The forward-looking statements contained in this press release speak only as of the date hereof and AutoCanada assumes no obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable securities laws.
SOURCE AutoCanada Inc.
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