Driven Brands Q2 2024 10-Q Filed

TL;DR

**Driven Brands Q2 2024 10-Q is in! Check financials for auto services giant.**

AI Summary

Driven Brands Holdings Inc. filed its 10-Q for the period ending June 29, 2024. The filing details financial performance and operational updates for the company, which operates in the automotive repair, services, and parking sector. Specific financial figures and operational metrics for the second quarter of 2024 are presented.

Why It Matters

This filing provides investors and analysts with the latest financial health and operational performance of Driven Brands, a significant player in the automotive services industry.

Risk Assessment

Risk Level: medium — The company operates in a competitive and cyclical industry, and its financial performance is subject to various market and economic factors.

Key Numbers

• 2024-06-29 — Reporting Period End Date (Indicates the end of the financial quarter being reported.)
• 2024-08-08 — Filing Date (The date the 10-Q was officially submitted to the SEC.)

Key Players & Entities

• Driven Brands Holdings Inc. (company) — Filer of the 10-Q
• 2024-06-29 (date) — End of the reporting period
• 2024-08-08 (date) — Date of filing
• Charlotte, NC (location) — Company headquarters

FAQ

Key Financial Figures

• $0.01 — 55 Title of each class Common Stock, $0.01 par value Trading Symbol DRVN Name

Filing Documents

• drvn-20240629.htm (10-Q) — 1755KB
• exhibit311-q22024ceo302cer.htm (EX-31.1) — 10KB
• exhibit312-q22024pfo302cer.htm (EX-31.2) — 10KB
• exhibit321-q22024ceo906cer.htm (EX-32.1) — 5KB
• exhibit322-q22024pfo906cer.htm (EX-32.2) — 5KB
• drvn-20240629_g1.jpg (GRAPHIC) — 112KB
• 0001804745-24-000020.txt ( ) — 7602KB
• drvn-20240629.xsd (EX-101.SCH) — 44KB
• drvn-20240629_cal.xml (EX-101.CAL) — 81KB
• drvn-20240629_def.xml (EX-101.DEF) — 194KB
• drvn-20240629_lab.xml (EX-101.LAB) — 587KB
• drvn-20240629_pre.xml (EX-101.PRE) — 403KB
• drvn-20240629_htm.xml (XML) — 1051KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements (Unaudited)

Item 1. Financial Statements (Unaudited) 3 Consolidated Statements of Operations 3 Consolidated Statements of Comprehensive Income (Loss) 4 Consolidated Balance Sheets 5 Consolidated Statements of Shareholders' Equity 6 Consolidated Statements of Cash Flows 8 Notes to the Consolidated Financial Statements 10

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 21

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 44

Controls and Procedures

Item 4. Controls and Procedures 45

. OTHER INFORMATION

PART II . OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 46

Risk Factors

Item 1A. Risk Factors 46

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 46

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 46

Other Information

Item 5. Other Information 46

Exhibits

Item 6. Exhibits 47

Forward-Looking Statements

Forward-Looking Statements This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are generally identified by the use of forward-looking terminology, including the terms "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "likely," "may," "plan," "possible," "potential," "predict," "project," "should," "target," "will," "would" and, in each case, their negative or other various or comparable terminology. All statements other than statements of historical facts contained in this Quarterly Report, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, trends, plans, objectives of management, impact of accounting standards and guidance, impairments, and expected market growth are forward-looking statements. In particular, forward-looking statements include, among other things, statements relating to: (i) our strategy, outlook, and growth prospects; (ii) our operational and financial targets and dividend policy; (iii) general economic trends and trends in the industry and markets; (iv) the risks and costs associated with the integration of, and or ability to integrate, our stores and business units successfully; (v) the proper application of generally accepted accounting principles, which are highly complex and involve many subjective assumptions, estimates, and judgments; and (vi) the competitive environment in which we operate. Forward-looking statements are not based on historical facts but instead represent our current expectations and assumptions regarding our business, the economy, and other future conditions, and involve known and unknown risks, uncertainties, and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expre

Financial Information

Part I. Financial Information

Financial Statements (Unaudited)

Item 1. Financial Statements (Unaudited) DRIVEN BRANDS HOLDINGS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Six Months Ended (in thousands, except per share amounts) June 29, 2024 July 1, 2023 June 29, 2024 July 01, 2023 Net revenue: Franchise royalties and fees $ 50,029 $ 49,805 $ 95,074 $ 93,320 Company-operated store sales 394,681 394,578 769,137 770,644 Independently-operated store sales 60,280 61,533 113,327 114,065 Advertising contributions 24,911 24,749 48,981 46,426 Supply and other revenue 81,665 76,186 157,273 144,863 Total net revenue 611,566 606,851 1,183,792 1,169,318 Operating Expenses: Company-operated store expenses 254,174 257,040 496,227 500,449 Independently-operated store expenses 31,956 31,958 61,311 61,322 Advertising expenses 24,911 24,749 48,981 46,426 Supply and other expenses 40,554 42,106 76,770 79,372 Selling, general, and administrative expenses 121,123 96,815 237,525 209,143 Acquisition related costs 271 3,750 2,065 5,597 Store opening costs 940 1,377 2,203 2,402 Depreciation and amortization 44,633 45,419 87,862 83,617 Asset impairment charges and lease terminations 12,497 6,044 31,823 6,211 Total operating expenses 531,059 509,258 1,044,767 994,539 Operating income 80,507 97,593 139,025 174,779 Other expenses, net: Interest expense, net 31,796 40,871 75,568 79,012 Foreign currency transaction loss (gain), net 681 ( 1,302 ) 5,002 ( 2,977 ) Other expense, net 32,477 39,569 80,570 76,035 Income before taxes 48,030 58,024 58,455 98,744 Income tax expense 17,871 20,275 24,035 31,246 Net income $ 30,159 $ 37,749 $ 34,420 $ 67,498 Earnings per share: Basic $ 0.18 $ 0.23 $ 0.21 $ 0.41 Diluted $ 0.18 $ 0.22 $ 0.21 $ 0.40 Weighted average shares outstanding Basic 159,795 162,911 159,713 162,848 Diluted 160,765 166,888 160,683 166,882 The accompanying notes are an integral part of these unaudited consolidated financial statements. 3 DRIVEN BRANDS HOLDING

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1— Description of Business Description of Business Driven Brands Holdings Inc. together with its subsidiaries (collectively, the "Company") is a Delaware corporation and is the parent holding company of Driven Brands, Inc. and Shine Holdco (UK) Limited (collectively, "Driven Brands"). Driven Brands is the largest automotive services company in North America with a growing and highly-franchised base of more than 5,000 franchised, independently-operated, and company-operated locations across 49 U.S. states and 13 other countries. The Company has a portfolio of highly recognized brands, including Take 5 Oil Change , Take 5 Car Wash , Meineke Car Care Centers , MAACO , CARSTAR , Auto Glass Now , and 1-800-Radiator & A/C that compete in the automotive services industry. Tax Receivable Agreement The Company expects to be able to utilize certain tax benefits which are related to periods prior to the effective date of the Company's IPO and are attributed to current and former shareholders. The Company previously entered into a Tax Receivable Agreement which provides our pre-IPO shareholders with the right to receive payment of 85 % of the amount of cash savings, if any, in U.S. and Canadian federal, state, local, and provincial income tax that the Company will actually realize or divests. The Tax Receivable Agreement was effective as of the date of the Company's IPO. The Company recorded a current tax receivable liability of $ 56 million as of December 30, 2023 and a non-current tax receivable liability of $ 134 million and $ 118 million as of June 29, 2024 and December 30, 2023, respectively, on the consolidated balance sheets. We made payments of approximately $ 38 million under the Tax Receivable Agreement in 2024 and no additional payments are planned within the next 12 months. Note 2— Summary of Significant Accounting Policies Fiscal Year The Company operates and reports financial information on a 52

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View this 10-Q filing on SEC EDGAR