Q2 2026 AutoCanada Inc Earnings Call Transcript
Key Points
- Used vehicle volumes and gross profit improved sequentially, with a 13.3% revenue increase and a 10% rise in retail units.
- Finance and Insurance performance was strong, with gross profit up 4% and average gross profit per retail unit rising to $3,410 from $3,337.
- Inventory discipline improved significantly, with faster turns and reduced days of supply, particularly in used vehicles.
- Collision business gross profit increased and margins improved, driven by a stronger mix and contributions from recent acquisitions.
- The company made significant progress on divestitures, receiving approximately $106 million from US sales and expecting at least $130 million in total proceeds.
- New vehicle sales and gross profits remained under pressure due to a soft market and ongoing sales productivity rebuilding.
- Adjusted EBITDA from continuing operations declined to $52 million from $64 million, with margin down to 3.7% from 4.8%.
- Gross profit decreased 8.1% to $207 million, with gross profit percentage down 220 basis points to 14.6%.
- Parts and Service revenue declined, and the company faces challenges in technician staffing and customer retention.
- Leverage remains high at 3.6 times net funded debt to bank EBITDA, above the target range of 2 to 3 times.
Thank you for joining AutoCanada's conference call to discuss the financial results for the second quarter of 2026. I'm John, your moderator for today's call.
Before we begin, I'd like to remind everyone that today's discussion may include forward-looking statements which are subject to risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements. I encourage you to review AutoCanada's filings on SEDAR+ for a discussion of these risks as well as the second-quarter news release, financial statements, and MD&A.
All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session.
I'd now like to turn the call over to Mr. Samuel Cochrane, Chief Executive Officer of AutoCanada, Inc.
Good evening, everyone, and thank you for joining us. Before getting to the quarter, I want to spend a few minutes on the environment and the progress we are making
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