Financial Data and Key Metrics Changes - Driven Brands reported a revenue increase of 6% year-over-year, totaling $551 million for Q2 2025 [17][18] - Adjusted EBITDA for the quarter was $143.2 million, reflecting a slight decrease of approximately $200,000 compared to Q2 2024 [18] - The adjusted EBITDA margin decreased by roughly 160 basis points to 26% due to increased operating expenses [19] - Net income from continuing operations was $11.8 million, with adjusted net income of $59.1 million, resulting in adjusted diluted EPS of $0.36, down $0.01 from the previous year [19] Business Line Data and Key Metrics Changes - The Take Five Oil Change segment, which represents about 75% of overall adjusted EBITDA, achieved same-store sales growth of 6.6% and revenue growth of 14.7% [20] - Franchise Brands experienced a 1.5% decline in same-store sales, although this marked a sequential improvement from Q1 2025 [21] - The Car Wash segment reported same-store sales growth of 19.4%, with adjusted EBITDA increasing to $27.3 million and adjusted EBITDA margin rising to 37% [22] Market Data and Key Metrics Changes - System-wide sales increased by 3.1% to $1.6 billion, supported by the addition of 52 net new stores in Q2 2025 [17] - The company added 184 net new stores over the last twelve months, with 41 new stores opened in the current quarter [7][17] - The collision industry remains under pressure, with Driven Brands gaining market share despite overall industry softness [11][66] Company Strategy and Development Direction - The company aims to reduce net leverage to three times by 2026, having already paid down nearly $700 million of debt since the end of 2023 [12][13] - Driven Brands is focused on delivering consistent growth through Take Five, generating strong free cash flow from Franchise Brands, and executing on its deleveraging plan [7][14] - The company is expanding its service offerings, including the rollout of differential fluid service, which is expected to enhance non-oil change revenue [9][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience despite a dynamic macro environment, noting strong performance in the Take Five segment and sequential improvement in Franchise Brands [27] - The company anticipates ongoing softness in the collision and Mako segments due to discretionary spending pullbacks among lower-income consumers [11][27] - For the full year 2025, the company reiterated its revenue guidance of $2.05 billion to $2.15 billion and adjusted EBITDA of $520 million to $550 million [27][28] Other Important Information - The company successfully monetized a seller note from the U.S. Car Wash transaction for $113 million, which was used to retire its term loan and reduce its revolving credit facility [12][22] - Free cash flow for the quarter was $31.9 million, driven by strong operating performance [23] - The company expects net store growth between 175 and 200 units for the year, with capital expenditures projected to be between 6.5% and 7.5% of revenue [28] Q&A Session Summary Question: Can you dive deeper into the traffic versus ticket side within Take Five? - Management indicated satisfaction with the 7% same-store sales growth and noted that both traffic and ticket metrics are performing well [32][34] Question: What are the profitability implications for the Take Five segment in the back half of the year? - Management expressed confidence in maintaining mid-30s margins, despite some expected variability due to increased costs [36][37] Question: How much of the strength in the Car Wash business is due to internal initiatives? - Management acknowledged both internal initiatives and favorable weather as contributing factors, but anticipated moderation in growth rates in the back half of the year [46][48] Question: What is the outlook for non-oil change services? - Management sees significant growth potential in non-oil change services, with attachment rates continuing to improve [51][56] Question: Can you comment on the collision industry softness? - Management noted that the collision industry is facing challenges due to claim avoidance and high total loss rates, but Driven Brands is gaining market share [65][66] Question: What is the competitive dynamic for the Take Five business? - Management highlighted Take Five's unique value proposition of a quick, convenient service, which continues to attract customers and franchisee interest [116]

Financial Performance - The net leverage ratio as of Q2 2025 was 4.1x[1,2] - Net loss for the six months ended December 28, 2024, was $326.916 million, while net income for the six months ended June 28, 2025, was $29.299 million[1] - Interest expense, net, for the six months ended December 28, 2024, was $81.396 million, and for the six months ended June 28, 2025, was $67.893 million[1] - Depreciation and amortization for the six months ended December 28, 2024, was $92.250 million, and for the six months ended June 28, 2025, was $68.055 million[1] - Adjusted EBITDA for the twelve months ended June 28, 2025, was $537.822 million[1] - Debt Agreement Adjusted EBITDA for the twelve months ended June 28, 2025, was $532.968 million[1] Debt and Cash Flow - Total debt as of June 28, 2025, was $2.376724 billion[1] - Cash and cash equivalents as of June 28, 2025, were $166.131 million[1] - Net debt as of June 28, 2025, was $2.210593 billion[1] Adjustments to EBITDA - Pro forma EBITDA adjustments resulted in a decrease of $23.535 million[1] - Run rate adjustments related to store openings and closings resulted in an increase of $11.395 million[1] - Other adjustments permitted under the Debt Agreement resulted in an increase of $7.287 million[1]

Second Quarter 2025 Financial Results Overview [Executive Summary and Key Highlights](index=1&type=section&id=Executive%20Summary%20and%20Key%20Highlights) Driven Brands achieved its 18th consecutive quarter of same store sales growth, with Q2 2025 revenue up 6.2% to $551.0 million and system-wide sales up 3.1% to $1.6 billion - Achieved **18th consecutive quarter of same store sales growth**[1](index=1&type=chunk) - Take 5 segment delivered **15% revenue growth** and **7% same store sales growth**[1](index=1&type=chunk) - Pro forma net leverage ratio of **3.9x Adjusted EBITDA** post sale of U.S. car wash seller note[1](index=1&type=chunk) Q2 2025 Key Financial Highlights | Metric | Q2 2025 | Q2 2024 | Change (%) | | :-------------------------------- | :-------- | :-------- | :--------- | | Revenue | $551.0M | $518.8M | +6.2% | | System-wide Sales | $1.6B | $1.58B | +3.1% | | Same Store Sales Growth | 1.7% | N/A | N/A | | Store Count Growth | 3.9% | N/A | N/A | | Net Income from Continuing Operations | $11.8M | $37.2M | -68.3% | | Diluted EPS from Continuing Operations | $0.07 | $0.22 | -68.2% | | Adjusted Net Income | $59.1M | $60.4M | -2.15% | | Adjusted Diluted EPS | $0.36 | $0.37 | -2.7% | | Adjusted EBITDA | $143.2M | $143.4M | -0.14% | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Danny Rivera highlighted consistent performance, successful debt reduction, and the strength of the diversified platform, expressing confidence in sustainable growth and leverage reduction - Achieved pro forma net leverage of **3.9x** following the sale of the U.S. car wash seller note in July[3](index=3&type=chunk) - Take 5 Oil Change delivered its **20th consecutive quarter of same store sales growth**[3](index=3&type=chunk) - Key priorities include driving continued growth, generating robust free cash flow, and reducing leverage[4](index=4&type=chunk) [Q2 2025 Key Performance Indicators by Segment](index=1&type=section&id=Q2%202025%20Key%20Performance%20Indicators%20by%20Segment) Take 5 and Car Wash segments showed strong performance with significant same store sales and revenue growth, while Franchise Brands maintained a large system-wide sales base Q2 2025 Key Performance Indicators by Segment | Segment | System-wide Sales (in millions) | Store Count | Same Store Sales | Revenue (in millions) | Adjusted EBITDA (in millions) | | :---------------- | :------------------------------ | :---------- | :--------------- | :-------------------- | :---------------------------- | | Take 5 | $406.6 | 1,244 | 6.6 % | $304.2 | $108.2 | | Franchise Brands | $1,075.2 | 2,673 | (1.5) % | $74.6 | $45.4 | | Car Wash | $71.8 | 718 | 19.4 % | $73.4 | $27.3 | | Corporate and Other | $71.2 | 214 | N/A | $98.8 | $(37.7) | | Total | $1,624.8 | 4,849 | 1.7 % | $551.0 | $143.2 | Financial Statements [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Total net revenue increased by 6.2% to $551.0 million in Q2 2025, but operating income and net income from continuing operations significantly decreased due to higher expenses Q2 2025 Consolidated Statements of Operations Highlights | Metric (in thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Change (%) | | :-------------------------------- | :------------------------------- | :------------------------------- | :--------- | | Total Net Revenue | $550,988 | $518,796 | +6.2% | | Operating Income | $38,112 | $90,074 | -57.6% | | Net Income from Continuing Operations | $11,809 | $37,217 | -68.3% | | Diluted EPS from Continuing Operations | $0.07 | $0.22 | -68.2% | | Net Income | $47,564 | $30,159 | +57.7% | | Net Diluted EPS | $0.29 | $0.18 | +61.1% | - Selling, general, and administrative expenses increased from **$119.8 million** in Q2 2024 to **$183.1 million** in Q2 2025[17](index=17&type=chunk) - Gain on sale of discontinued operations, net of tax, contributed **$37.367 million** to net income in Q2 2025[17](index=17&type=chunk) [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to $4.28 billion as of June 28, 2025, primarily due to divestitures, while total liabilities also fell significantly, and shareholders' equity increased Consolidated Balance Sheet Highlights | Metric (in thousands) | June 28, 2025 | December 28, 2024 | Change (%) | | :-------------------------------- | :-------------- | :---------------- | :--------- | | Total Assets | $4,283,514 | $5,261,787 | -18.6% | | Total Liabilities | $3,540,119 | $4,654,453 | -23.9% | | Total Shareholders' Equity | $743,395 | $607,334 | +22.4% | | Cash and Cash Equivalents | $166,131 | $149,573 | +11.1% | | Long-term Debt | $2,094,535 | $2,656,308 | -21.2% | - The balance sheet reflects the divestiture of the U.S. car wash business, with "Assets held for sale" decreasing and "Seller note receivable" appearing at **$113.0 million**[19](index=19&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities increased to $155.5 million for the six months ended June 28, 2025, while investing activities significantly improved, and financing activities saw a substantial increase in debt repayment Six Months Ended June 28, 2025 Cash Flow Highlights | Metric (in thousands) | Six Months Ended June 28, 2025 | Six Months Ended June 29, 2024 | Change (%) | | :-------------------------------- | :------------------------------- | :------------------------------- | :--------- | | Net Cash Provided by Operating Activities | $155,527 | $107,224 | +45.1% | | Cash Provided by (Used in) Investing Activities | $157,552 | $(34,026) | N/A (significant improvement) | | Cash Used in Financing Activities | $(321,882) | $(102,063) | +215.4% | | Proceeds from sale or disposal of businesses and fixed assets | $259,585 | $112,845 | +130.0% | | Repayment of long-term debt | $(305,446) | $(34,005) | +798.2% | Capital and Liquidity [Liquidity Position](index=2&type=section&id=Liquidity%20Position) Driven Brands ended Q2 2025 with total liquidity of $654.8 million, including cash and undrawn capacity from its variable funding securitization senior notes and revolving credit facility Q2 2025 Liquidity Position | Metric | Amount (in millions) | | :-------------------------------- | :------------------- | | Total Liquidity | $654.8 | | Cash and Cash Equivalents | $166.1 | | Undrawn Capacity (VFN & Revolver) | $488.7 | | Additional VFN Borrowing Capacity | $135.0 | [Seller Note Divestiture](index=2&type=section&id=Seller%20Note%20Divestiture) Driven Brands divested its U.S. car wash seller note for $113.0 million in cash, using proceeds to reduce debt and achieve a pro forma net leverage ratio of 3.9x Adjusted EBITDA - Divested seller note for **$113.0 million** in cash proceeds on July 25, 2025[8](index=8&type=chunk) - Net proceeds used to pay off outstanding term loan principal and **$65.0 million** of revolving credit facility[8](index=8&type=chunk) - Achieved pro forma net leverage of **3.9x Adjusted EBITDA** after debt reduction[8](index=8&type=chunk) Fiscal Year 2025 Outlook [Reaffirmed Financial Outlook](index=2&type=section&id=Reaffirmed%20Financial%20Outlook) Driven Brands reaffirmed its fiscal year 2025 financial outlook, projecting revenue between $2.05 billion and $2.15 billion, Adjusted EBITDA between $520 million and $550 million, and Adjusted Diluted EPS between $1.15 and $1.25 - Reaffirmed fiscal year 2025 financial outlook[9](index=9&type=chunk) Fiscal Year 2025 Financial Outlook | Metric | 2025 Outlook | | :-------------------- |

Driven Brands (DRVN) 2025 Conference Summary Company Overview - Driven Brands is the largest automotive services platform in North America with approximately 4,800 locations, providing essential services such as oil changes, maintenance, paint, collision, and glass work [1][2] Key Points and Arguments Business Model and Strategy - About 80% of Driven Brands' locations are franchised or independently operated, with a recent divestiture of the U.S. car wash business, which was capital intensive and discretionary [2] - The company is at an inflection point for free cash flow, aiding in deleveraging efforts [3] - The CFO, Mike Diamond, emphasizes growth, capital allocation, and value creation as key focuses since taking over [5][7] Take Five as Growth Engine - Take Five is highlighted as the crown jewel of Driven Brands, with over 1,300 units and significant growth potential [14] - Same-store sales for Take Five increased by 8% in the last quarter, attributed to its unique service model of a 10-minute oil change while customers remain in their cars [14][15] - The company has a pipeline of about 1,000 units, with expectations to open 175 to 200 new units in the current year, transitioning towards a more balanced mix of corporate and franchise locations [18][19] Financial Performance and Projections - The expected adjusted EBITDA for the year is between $520 million and $550 million, with a focus on maintaining strong free cash flow [64][66] - Cash on cash return for franchisees is projected at about 30%, with a payback period of under three years for new units [22][20] - Non-oil change revenue currently accounts for about 20% of total revenue, with significant growth potential in this area [26] Market Position and Competitive Landscape - Driven Brands is positioned to capture market share from smaller competitors and dealerships, with a focus on convenience and customer satisfaction [30][31] - The company believes there is still a long runway for growth in the oil change market, despite competition [32] Margin and Cost Management - The EBITDA margin for the business is in the mid-30s, with expectations for consistency throughout the year despite some minor dips due to G&A and rent costs [33][34] - Capital expenditures are projected at 6.5% to 7.5% of sales, with half allocated to supporting Take Five growth [57][59] Franchise Business and Cash Flow Generation - The franchise segment is crucial for cash flow generation, providing stability and funding for future growth initiatives [36][38] - Relationships with fleet and insurance companies are enhanced through franchise brands, aiding in business development [37] Future Growth Opportunities - The glass business is seen as a promising growth area, leveraging existing insurance relationships [39][40] - Driven Advantage, the company's procurement engine, aims to enhance purchasing power and expand product offerings [42][44] Tariff Exposure and Economic Resilience - Driven Brands has modest exposure to tariffs, with a strong demand outlook due to the nondiscretionary nature of its services [45][48] - The company is well-positioned to navigate economic uncertainties, as car maintenance remains a priority for consumers [45] Additional Insights - The transition in leadership from Jonathan to Danny is expected to maintain continuity in strategy while enhancing operational focus [10][12] - The company is committed to deleveraging, aiming for a net leverage ratio of three times by the end of 2026, with ongoing asset sales contributing to this goal [68][71] - The potential of the AGN business is viewed as a call option for future growth, not yet reflected in current valuations [73][74]

Core Insights - Driven Brands Holdings Inc. reported a revenue of $516.16 million for the quarter ended March 2025, reflecting a year-over-year decline of 9.8% but exceeding the Zacks Consensus Estimate by 4.02% [1] - The company's EPS for the quarter was $0.27, up from $0.23 in the same quarter last year, resulting in an EPS surprise of 17.39% compared to the consensus estimate [1] Financial Performance Metrics - Same-store sales increased by 0.7%, falling short of the average estimate of 1.9% [4] - Total store count was reported at 4,797, below the average estimate of 5,036 [4] - Car wash store count was 718, significantly lower than the estimated 914 [4] - Same-store sales for car wash services surged by 26.2%, compared to the average estimate of 1.4% [4] - Company-operated store count was 964, below the average estimate of 1,156 [4] - Revenue from company-operated store sales was $314.13 million, down 16.1% year-over-year and below the average estimate of $326.76 million [4] - Revenue from independently-operated store sales reached $66.64 million, exceeding the estimate of $52.68 million and representing a year-over-year increase of 25.6% [4] - Advertising contributions generated $25.33 million, slightly below the estimate of $25.51 million, but up 5.2% year-over-year [4] - Franchise royalties and fees totaled $44.71 million, below the estimate of $48.39 million, with a slight decline of 0.7% year-over-year [4] - Revenue from supply and other sources was $65.36 million, below the average estimate of $74.85 million, reflecting a year-over-year decrease of 13.6% [4] - Corporate/Other revenue was reported at $83 million, significantly exceeding the estimate of $6.51 million, marking a dramatic increase of 1382.1% year-over-year [4] - Revenue from car wash services was $68 million, below the estimate of $85.71 million, representing a decline of 53% year-over-year [4] Stock Performance - Driven Brands Holdings' shares have returned +12.3% over the past month, outperforming the Zacks S&P 500 composite's +11.5% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

分组1 - Driven Brands Holdings Inc. reported quarterly earnings of $0.27 per share, exceeding the Zacks Consensus Estimate of $0.23 per share, and showing an increase from $0.23 per share a year ago, representing an earnings surprise of 17.39% [1] - The company achieved revenues of $516.16 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 4.02%, although this is a decrease from year-ago revenues of $572.23 million [2] - Driven Brands Holdings has outperformed the S&P 500, with shares increasing about 7.4% since the beginning of the year, while the S&P 500 has declined by 3.9% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.35 on revenues of $535.75 million, and for the current fiscal year, it is $1.22 on revenues of $2.09 billion [7] - The Automotive - Retail and Wholesale - Parts industry, to which Driven Brands Holdings belongs, is currently ranked in the top 18% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8]

Financial Data and Key Metrics Changes - Driven Brands reported Q1 2025 revenue of $516 million, a 7.1% increase year-over-year, supported by 177 net new stores and 0.7% same-store sales growth, marking the seventeenth consecutive quarter of positive same-store sales growth [7][19] - Diluted adjusted EPS from continuing operations was $0.27, and adjusted EBITDA was $125 million, reflecting a 1.9% increase [8][21] - Operating income declined by $6.8 million to $61.3 million for Q1, while adjusted EBITDA margin decreased by approximately 120 basis points to 24.2% [20][21] Business Line Data and Key Metrics Changes - Take Five Oil Change achieved same-store sales growth of 8% and revenue growth of 15.3%, with adjusted EBITDA of $100.9 million, reflecting a 13.5% increase [10][22] - Franchise Brands experienced a 2.9% decline in same-store sales, with segment revenue down by $4.6 million or 6.1% [11][24] - The international car wash segment reported same-store sales growth of 26.2%, with adjusted EBITDA increasing by $6.4 million to $24.4 million [12][25] Market Data and Key Metrics Changes - System-wide sales for the company grew by 2.2% in Q1 to $1.5 billion [19] - The company closed a net of 19 units in the Franchise Brands segment due to the departure of a franchisee [19][24] - The U.S. Car Wash transaction closed on April 10, 2025, providing liquidity for debt repayment and simplifying the company's portfolio [13][28] Company Strategy and Development Direction - The company aims to utilize excess free cash flow to reduce debt, targeting a net leverage ratio of three times by the end of 2026 [7][14] - Driven Brands is focused on maintaining growth in its Take Five business while managing the performance of its franchise segment [32][33] - The divestiture of the U.S. Car Wash business is expected to support the company's outlook for net capital expenditures, which are projected to be approximately $70 million less than the previous year [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver results despite macroeconomic uncertainties, emphasizing the essential nature of their services [15][17] - The company remains cautious about the potential impact of tariffs on margins and demand but believes its diversified sourcing strategy will mitigate risks [14][30] - Management reiterated its fiscal 2025 outlook, expecting moderate growth in Take Five and continued softness in the discretionary business, Mako [31][32] Other Important Information - The company has paid down nearly $290 million in debt since the beginning of 2025, with total debt repaid exceeding $5 billion since 2024 [8][27] - Free cash flow for the quarter was $27.6 million, driven by strong operating performance [26] Q&A Session Summary Question: Can you discuss the margin management for Take Five? - Management noted that margin pressure was due to increased repair and maintenance and rent expenses, but they remain confident in the team's ability to manage costs effectively [35][36] Question: What is the outlook for Franchise Brands if same-store sales softness continues? - Management indicated that while there are limited levers in a franchise model, they are optimistic about the long-term trajectory of the franchise brands despite current softness [37][38] Question: What are the expectations for Q2 comps? - Management refrained from providing specific quarter guidance but indicated they expect to see trends stabilize, with a potential for 1% to 3% growth based on current trends [42][44] Question: How is the Auto Glass business performing? - Management confirmed that the Auto Glass business is still in the early stages of growth, with positive developments in securing insurance and commercial accounts [50][63] Question: Are there any signs of increased price competition in the Quick Lubes market? - Management reported no significant material changes in competitive pricing dynamics, although some localized competition may exist [100] Question: How does the company view the impact of economic downturns on its business? - Management emphasized that the majority of their services are nondiscretionary, which positions them well during economic uncertainty, as consumers will still need vehicle maintenance [90][112]

Financial Data and Key Metrics Changes - Driven Brands reported Q1 2025 revenue of $516 million, a 7.1% increase year-over-year, supported by 177 net new stores and 0.7% same-store sales growth, marking the seventeenth consecutive quarter of positive same-store sales growth [5][18] - Adjusted EBITDA for Q1 increased by 1.9% to $125.1 million, with an adjusted EBITDA margin of 24.2%, a decrease of approximately 120 basis points compared to the previous year [20][21] - The company generated diluted adjusted EPS from continuing operations of $0.27, up $0.02 from Q1 last year, driven by strong operating performance and continued debt paydown [6][20] Business Line Data and Key Metrics Changes - Take Five Oil Change achieved same-store sales growth of 8% for the quarter, marking its nineteenth consecutive quarter of positive same-store sales, with revenue growth of 15.3% and adjusted EBITDA growth of 13.5% [8][21] - The Franchise Brands segment experienced a 2.9% decline in same-store sales, primarily due to softness in the Mako brand, with segment revenue declining by 6.1% [10][22] - The international car wash segment reported same-store sales growth of 26.2%, with revenue and adjusted EBITDA increasing by 2536% year-over-year [11][24] Market Data and Key Metrics Changes - System-wide sales for the company grew by 2.2% in Q1 to $1.5 billion [18] - The company closed a net of 19 units in the Franchise Brands segment due to the negotiated departure of a franchisee [17] Company Strategy and Development Direction - The company aims to utilize excess free cash flow to reduce debt, with a target of reducing net leverage to three times by the end of 2026 [5][12] - The divestiture of the U.S. Car Wash business is expected to simplify the portfolio and support the goal of reducing net CapEx [12][28] - The company remains focused on growing the Take Five business and maintaining the strength of its franchise segment while generating cash and executing its deleveraging plan [32][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver despite macroeconomic uncertainties, highlighting the essential nature of their services [14][32] - The company anticipates that the second half of 2025 will contribute a percentage in the low 50s for full-year revenue and adjusted EBITDA [32] - Management noted that while there may be softness in discretionary services like Mako, the overall business model remains resilient due to the nondiscretionary nature of most services [91][92] Other Important Information - The company has paid down nearly $290 million in debt since the beginning of 2025, with total debt repaid exceeding $5 billion since the start of 2024 [6][29] - The company extended its revolving credit facility for an additional five years, maintaining a capacity of $300 million [26][27] Q&A Session Summary Question: Regarding Take Five's EBITDA margin and potential for margin increase if same-store sales slow - Management indicated that margin pressure was due to increased repair and maintenance and rent expenses, but they remain confident in the team's ability to manage costs effectively [38][39] Question: Update on Franchise Brands and potential for driving EBITDA amidst softness - Management noted that while there are limited levers in a franchise business, they are optimistic about the long-term trajectory of the franchise brands despite current softness [40] Question: Expectations for Q2 comps and potential acceleration in the back half of the year - Management refrained from providing specific quarter guidance but indicated that they expect some moderation in growth due to the larger base created by new openings [44][46] Question: Update on the Auto Glass business performance - Management confirmed that the Auto Glass business is still in the early stages of growth, with positive developments in securing insurance and commercial accounts [50][52] Question: Observations on oil change customer behavior amidst economic pressures - Management reported strong performance in the Take Five business, with no significant changes in customer trends despite economic pressures [59][61] Question: Insights on the impact of tariffs on franchisee costs - Management acknowledged the potential impact of tariffs but indicated that they have not seen significant effects on costs thus far [72][73] Question: Discussion on the performance of the Mako brand and collision repair services - Management confirmed that Mako is experiencing softness due to its discretionary nature, but they believe they can get the business back on track in the second half of the year [81][84]

[First Quarter 2025 Financial Highlights](index=1&type=section&id=First%20Quarter%202025%20Results) [Overall Performance](index=1&type=section&id=Overall%20Performance) In the first quarter of 2025, Driven Brands reported a 7% year-over-year increase in revenue to $516.2 million and a 2% rise in system-wide sales to $1.5 billion, marking its 17th consecutive quarter of same-store sales growth Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue (in millions) | $516.2M | $482.0M | +7% | | System-Wide Sales (in billions) | $1.5B | $1.5B | +2% | | Same Store Sales | +1% | N/A | N/A | | Net Income (in millions) | $6.0M | $4.0M | +50% | | Diluted EPS | $0.04 | $0.02 | +100% | | Adjusted Net Income (in millions) | $44.0M | $40.0M | +10% | | Adjusted Diluted EPS | $0.27 | $0.25 | +8% | | Adjusted EBITDA (in millions) | $125.0M | $122.8M | +2% | [Segment Performance](index=1&type=section&id=Segment%20Performance) The Take 5 Oil Change segment was a standout performer, delivering 15% revenue growth and 8% same-store sales growth, while the Franchise Brands segment experienced a 2.9% decline in same-store sales - Take 5 Oil Change achieved its **19th consecutive quarter** of same-store sales growth, with revenue up **15%** and same-store sales up **8%**[1](index=1&type=chunk)[3](index=3&type=chunk) Q1 2025 Key Performance Indicators by Segment | Segment | System-wide Sales (in millions) | Store Count | Same Store Sales | Revenue (in millions) | Adjusted EBITDA (in millions) | | :--- | :--- | :--- | :--- | :--- | :--- | | Take 5 | $387.5 | 1,203 | 8.0% | $293.4 | $100.9 | | Franchise Brands | $1,033.4 | 2,660 | (2.9)% | $71.7 | $44.4 | | Car Wash | $66.6 | 718 | 26.2% | $68.0 | $24.4 | | Corporate and Other | $59.3 | 216 | N/A | $83.0 | $(44.6) | [Management Commentary & Corporate Developments](index=1&type=section&id=Management%20Commentary%20%26%20Corporate%20Developments) Management highlighted the successful divestiture of the U.S. car wash business in April 2025, with proceeds primarily used for debt reduction, and announced Danny Rivera as the new CEO - Successfully completed the sale of the U.S. car wash business in early April, using the proceeds mainly to reduce debt[1](index=1&type=chunk)[3](index=3&type=chunk) - The company remains committed to paying down debt as the business grows[3](index=3&type=chunk) - Danny Rivera has been appointed as the new CEO, with former CEO Jonathan Fitzpatrick remaining as Chair of the board[4](index=4&type=chunk) [Financial Outlook and Liquidity](index=2&type=section&id=Fiscal%20Year%202025%20Outlook) [Fiscal Year 2025 Outlook](index=2&type=section&id=Fiscal%20Year%202025%20Outlook) Driven Brands reaffirmed its financial outlook for the fiscal year 2025, anticipating revenue between $2.05 billion and $2.15 billion and same-store sales growth of 1% to 3% Fiscal Year 2025 Outlook | Metric | 2025 Outlook | | :--- | :--- | | Revenue (in billions) | ~$2.05 - $2.15 | | Adjusted EBITDA (in millions) | ~$520 - $550 | | Adjusted Diluted EPS | ~$1.15 - $1.25 | - The company also expects same-store sales growth of **1% - 3%** and net store growth of approximately **175 - 200** for fiscal year 2025[13](index=13&type=chunk) [Capital and Liquidity](index=2&type=section&id=Capital%20and%20Liquidity) The company concluded the first quarter with a strong liquidity position of $640.8 million, comprising $152.0 million in cash and cash equivalents and $488.7 million in undrawn capacity on its credit facilities - Ended Q1 with total liquidity of **$640.8 million**, consisting of **$152.0 million** in cash and **$488.7 million** of undrawn capacity on credit facilities[7](index=7&type=chunk) [Consolidated Financial Statements (Unaudited)](index=4&type=section&id=CONSOLIDATED%20FINANCIAL%20STATEMENTS%20(UNAUDITED)) [Consolidated Statements of Operations](index=4&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20(UNAUDITED)) For the first quarter ended March 29, 2025, total net revenue increased to $516.2 million from $482.0 million in the prior-year period, while operating income decreased to $61.3 million from $68.1 million Q1 2025 vs Q1 2024 Statement of Operations (in thousands) | Account | Three Months Ended Mar 29, 2025 | Three Months Ended Mar 30, 2024 | | :--- | :--- | :--- | | Total net revenue | $516,163 | $481,992 | | Total operating expenses | $454,898 | $413,910 | | Operating income | $61,265 | $68,082 | | Interest expense, net | $36,534 | $43,751 | | Net income from continuing operations | $17,490 | $11,552 | | Net income | $5,506 | $4,261 | | Diluted earnings per share | $0.04 | $0.02 | [Consolidated Balance Sheets](index=5&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS%20(UNAUDITED)) As of March 29, 2025, Driven Brands reported total assets of $5.30 billion, a slight increase from $5.26 billion at the end of fiscal 2024, with total liabilities remaining stable at $4.66 billion Balance Sheet Highlights (in thousands) | Account | March 29, 2025 | December 28, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $152,042 | $149,573 | | Total current assets | $671,381 | $657,438 | | Total assets | $5,301,651 | $5,261,787 | | Long-term debt | $2,616,272 | $2,656,308 | | Total liabilities | $4,658,408 | $4,654,453 | | Total shareholders' equity | $643,243 | $607,334 | [Consolidated Statements of Cash Flows](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20(UNAUDITED)) In the first quarter of 2025, cash provided by operating activities increased to $75.1 million from $60.3 million in the prior year, while cash used in investing activities was $44.0 million and cash used in financing activities increased to $47.8 million Q1 2025 vs Q1 2024 Statement of Cash Flows (in thousands) | Account | Three Months Ended Mar 29, 2025 | Three Months Ended Mar 30, 2024 | | :--- | :--- | :--- | | Cash provided by operating activities | $75,131 | $60,283 | | Cash used in investing activities | $(44,012) | $(34,280) | | Cash used in financing activities | $(47,767) | $(33,220) | [Reconciliation of Non-GAAP Financial Measures](index=8&type=section&id=RECONCILIATION%20OF%20NON-GAAP%20FINANCIAL%20MEASURES) [Adjusted Net Income and Adjusted EPS Reconciliation](index=8&type=section&id=Adjusted%20Net%20Income%20and%20Adjusted%20Earnings%20Per%20Share) For Q1 2025, Adjusted Net Income from continuing operations was $44.2 million, up from $40.0 million in Q1 2024, with adjustments to GAAP net income including share-based compensation and amortization of acquired intangibles Reconciliation to Adjusted Net Income (in thousands) | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income from continuing operations | $17,490 | $11,552 | | Share-based compensation expense | $11,788 | $11,861 | | Asset sale leaseback (gain) loss, net, etc. | $11,753 | $3,976 | | Amortization related to acquired intangible assets | $4,659 | $6,415 | | Other adjustments, net | $7,649 | $12,112 | | Tax impact of adjustments | $(9,160) | $(7,004) | | **Adjusted net income from continuing operations** | **$44,179** | **$40,012** | Adjusted EPS | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Adjusted basic EPS from continuing operations | $0.27 | $0.25 | | Adjusted diluted EPS from continuing operations | $0.27 | $0.25 | [Adjusted EBITDA Reconciliation](index=10&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA for Q1 2025 was $125.1 million, a 2% increase from $122.8 million in the prior year, primarily driven by the Take 5 segment's contribution of $100.9 million Net Income to Adjusted EBITDA Reconciliation (in thousands) | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income from continuing operations | $17,490 | $11,552 | | Income tax expense | $7,031 | $8,458 | | Interest expense, net | $36,534 | $43,751 | | Depreciation and amortization | $33,152 | $31,116 | | **EBITDA** | **$94,207** | **$94,877** | | Adjustments (Acquisition costs, Share-based comp, etc.) | $30,891 | $27,915 | | **Adjusted EBITDA** | **$125,098** | **$122,792** | Adjusted EBITDA by Segment (in thousands) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Take 5 | $100,918 | $88,888 | | Franchise Brands | $44,383 | $47,589 | | Car Wash | $24,388 | $17,985 | | Corporate and Other | $(44,591) | $(31,670) | | **Total Adjusted EBITDA** | **$125,098** | **$122,792** | [Supplemental Information](index=14&type=section&id=ADDITIONAL%20INFORMATION%20ON%20KEY%20PERFORMANCE%20INDICATORS%20(UNAUDITED)) [Key Performance Indicators by Segment](index=14&type=section&id=Key%20Performance%20Indicators%20by%20Segment) The company's total store count grew to 4,797 in Q1 2025, a net increase of 177 stores year-over-year, primarily driven by the Take 5 segment's expansion System-wide Sales & Store Count by Segment (Q1 2025) | Segment | System-wide Sales (in thousands) | Total Store Count | | :--- | :--- | :--- | | Take 5 | $387,488 | 1,203 | | Franchise Brands | $1,033,366 | 2,660 | | Car Wash | $66,640 | 718 | | Corporate and Other | $59,339 | 216 | | **Total** | **$1,546,833** | **4,797** | System-wide Sales & Store Count by Segment (Q1 2024) | Segment | System-wide Sales (in thousands) | Total Store Count | | :--- | :--- | :--- | | Take 5 | $326,427 | 1,035 | | Franchise Brands | $1,074,541 | 2,647 | | Car Wash | $53,047 | 718 | | Corporate and Other | $58,889 | 220 | | **Total** | **$1,512,904** | **4,620** |

Financial Performance - The net leverage ratio as of Q1 2025 was 4.3x[1] - For the twelve months ended March 29, 2025, the Debt Agreement Adjusted EBITDA was $578.303 million[1] - Total debt as of March 29, 2025, was $2,648.506 million[1] - Cash and cash equivalents totaled $152.042 million[1] - Net debt was $2,496.464 million[1] Key Adjustments to EBITDA - Adjusted EBITDA for the twelve months ended March 29, 2025, was $546.801 million before pro forma and other adjustments[1] - Pro forma EBITDA adjustments added $1.802 million[1] - Run rate adjustments related to store openings and closings contributed $8.899 million[1] - Other adjustments permitted under the Debt Agreement added $20.802 million[1] Loss and Expense Details - Net loss for the three months ended March 29, 2025, was $279.267 million[1] - Interest expense, net, for the twelve months ended March 29, 2025, was $149.726 million[1] - Depreciation and amortization for the twelve months ended March 29, 2025, was $170.035 million[1]