SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the transition period from ________ to ________
Commission File No.: 0-23962
TEAM RENTAL GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 59-3227576
-------- ----------
State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization
125 Basin Street, Suite 210, Daytona Beach, FL 32114
(Address of principal executive offices)
(904) 238-7035
--------------
Registrant's telephone number, including area code
Not applicable
--------------
(Former name, former address, and former fiscal year, if
changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X| No |_|
11,250,783 shares were outstanding as of August 12, 1996, comprised of 9,314,183
shares of the registrant's Class A common stock, par value $0.01, and 1,936,600
shares of the registrant's Class B common stock, par value $0.01.
The Exhibit Index, filed as a part of this report, appears on page 13.
- --------------------------------------------------------------------------------
1
<PAGE>
INDEX
PART I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 1996 (unaudited)
and December 31, 1995 3
Consolidated Statements of Operations for the Three- and Six-Month
Periods Ended June 30, 1996 and 1995 (unaudited) 4
Consolidated Statement of Changes in Stockholders' Equity
for the Six-Month Period Ended June 30, 1996 (unaudited) 5
Consolidated Statements of Cash Flows for the Six-Month
Periods Ended June 30, 1996 and 1995 (unaudited) 6
Notes to Unaudited Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. Other Information
Item 1. Legal Proceedings 12
Item 2. Changes in Securities 12
Item 3. Default Upon Senior Securities 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
Signature Page 14
2
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Team Rental Group, Inc.
Consolidated Balance Sheets
(Unaudited)
(Dollar amounts in thousands)
June 30, December 31,
ASSETS 1996 1995
--------- -----------
Cash and cash equivalents $ 10,970 $ 357
Restricted cash 2,878 67,731
Trade and vehicle receivables, net 24,249 20,928
Accounts receivable, related parties 61 61
Vehicle inventory 15,890 8,938
Revenue earning vehicles, net 337,633 219,927
Property and equipment, net 20,217 12,503
Franchise rights, net 59,315 46,670
Deferred financing fees, net 2,129 2,266
Other assets 9,449 6,942
--------- ---------
Total assets $ 482,791 $ 386,323
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Notes payable $ 402,338 $ 318,233
Capital lease obligations 702 784
Accounts payable 14,501 14,698
Deferred income taxes 1,433 1,701
Accrued and other liabilities 15,289 9,315
--------- ---------
Total liabilities 434,263 344,731
Common Stock Warrant 2,000 2,000
STOCKHOLDERS' EQUITY
Common Stock 74 72
Additional paid-in-capital 45,395 41,984
Retained earnings (accumulated deficit) 1,389 (2,134)
Treasury Stock (330) (330)
--------- ---------
Total stockholders' equity 46,528 39,592
--------- ---------
Total liabilities and stockholders' equity $ 482,791 $ 386,323
========= =========
See accompanying notes to unaudited consolidated financial statements.
3
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Team Rental Group, Inc.
Consolidated Statements of Operations
(Unaudited)
(Dollar amounts in thousands except per share data)
<TABLE>
<CAPTION>
For the three-month periods ended June 30, For the six-month periods ended June 30,
1996 1995 1996 1995
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Operating revenue:
Rental revenue $ 59,145 $ 23,788 $ 103,842 $ 41,142
Sales revenue 34,589 8,092 55,686 12,815
Other revenue 0 442 0 635
-------------- -------------- -------------- --------------
Total operating revenue 93,734 32,322 159,528 54,592
Operating expenses:
Direct vehicle and operating 8,533 2,673 14,492 5,298
Depreciation - vehicles 16,219 6,443 28,023 11,569
Depreciation - nonvehicle 674 300 1,210 585
Cost of car sales 29,455 7,192 47,295 11,450
Advertising, promotion and selling 6,009 2,493 10,609 4,529
Facilities 5,089 2,470 9,417 4,546
Personnel 13,316 5,363 24,005 9,857
General and administrative 3,115 1,115 5,385 2,001
Amortization 482 239 996 351
-------------- -------------- -------------- --------------
Total operating expenses 82,892 28,288 141,432 50,186
-------------- -------------- -------------- --------------
Operating income 10,842 4,034 18,096 4,406
-------------- -------------- -------------- --------------
Other (income) expense:
Vehicle interest 6,342 2,800 11,963 5,416
Other interest, net 795 165 931 232
Interest income - restricted cash (38) (172) (787) (572)
Related party interest 0 0 118 0
-------------- -------------- -------------- --------------
Total other (income) expense 7,099 2,793 12,225 5,076
Income (loss) before provision
(credit) for income taxes 3,743 1,241 5,871 (670)
Provision (credit) for income taxes 1,497 498 2,348 (267)
-------------- -------------- -------------- --------------
Net income (loss) $ 2,246 $ 743 $ 3,523 $ (403)
============== ============== ============== ==============
Net income (loss) per common share:
Primary $ 0.30 $ 0.12 $ 0.48 $ (0.07)
============== ============== ============== ==============
Fully diluted $ 0.30 $ 0.12 $ 0.47 $ (0.07)
============== ============== ============== ==============
Weighted average shares outstanding:
Primary 7,569,000 6,144,000 7,413,000 6,091,000
============== ============== ============== ==============
Fully diluted 7,584,000 6,144,000 7,497,000 6,091,000
============== ============== ============== ==============
</TABLE>
See accompanying notes to unaudited consolidated financial statements.
4
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Team Rental Group, Inc.
Consolidated Statement of Changes in
Stockholders' Equity
For the six-month period ended June 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Retained
Additional Earnings Total
Common Paid-In (Accumulated Treasury Stockholders'
(Dollar amounts in thousands) Stock Capital Deficit) Stock Equity
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1995 $ 72 $ 41,984 $ (2,134) ($330) $ 39,592
Shares issued in conjunction
with acquisition of
Arizona Rent A Car Systems, Inc. 2 2,725 2,727
Warrants issued in conjunction
with financing 686 686
Net Income 3,523 3,523
------------- ------------- ------------- ------------- -------------
Balance at June 30, 1996 $ 74 $ 45,395 $ 1,389 $ (330) $ 46,528
============= ============= ============= ============= =============
</TABLE>
See accompanying notes to unaudited consolidated financial statements.
5
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Team Rental Group, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
(Dollar amounts in thousands) For the six-month periods
ended June 30,
1996 1995
---------- ----------
Cash flows from operating activities:
Net income (loss) $ 3,523 $ (403)
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities:
Depreciation 29,233 12,154
Amortization 1,133 674
Deferred income tax provision (268) (21)
Changes in operating assets and liabilities:
Accounts receivable (3,321) (2,829)
Other assets (2,507) (3,627)
Vehicle inventory (6,952)
Accounts payable (197) 5,204
Other liabilities 5,974 3,913
---------- ----------
Total adjustments 23,095 15,468
---------- ----------
Net cash provided by operating activities 26,618 15,065
Cash flows from investing activities:
Restricted cash 64,853 31,923
Proceeds from sale of
revenue-earning vehicles 119,348 73,337
Purchases of revenue-earning vehicles (263,809) (162,064)
Purchase of rental vehicle franchise rights (11,496) (7,117)
Purchases of equipment and improvements (8,924) (2,577)
---------- ----------
Net cash used in investing activities (100,028) (66,498)
Cash flows from financing activities:
Proceeds from vehicle financing 108,893 52,840
Repayment of vehicle financing (50,362) (9,609)
Proceeds from borrowings under notes payable 26,074 10,353
Principal payments:
Capital leases (82) (59)
Other (500) (72)
---------- ----------
Net cash provided by financing activities 84,023 53,525
---------- ----------
Net increase in cash and cash equivalents 10,613 2,092
Cash and cash equivalents, beginning of period 357 878
---------- ----------
Cash and cash equivalents, end of period $ 10,970 $ 2,970
========== ==========
See accompanying notes to unaudited consolidated financial statements.
6
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Team Rental Group, Inc.
Notes to Unaudited Consolidated Financial Statements
1. Basis of Presentation
The accompanying unaudited consolidated financial statements of Team Rental
Group, Inc. (the "Company") for the three- and six-month periods ended June 30,
1996 and 1995 reflect all adjustments (consisting of normal recurring
adjustments) which, in the opinion of management, are necessary to present
fairly the Company's consolidated financial condition, results of operations and
cash flows for the periods presented. Operating results for the three- and
six-month periods ended June 30, 1996 are not necessarily indicative of the
results that may be expected for the entire year ending December 31, 1996.
The consolidated financial statements for the three- and six-month periods ended
June 30, 1995 give effect to the Company's acquisition of all of the outstanding
stock of the Budget franchises in Dayton, Ohio, Charlotte, North Carolina, and
Hartford, Connecticut. The accompanying statement of operations and statement of
cash flows only give effect to these operations for the period from their
respective dates of acquisition through June 30, 1995. The consolidated
financial statements as of June 30, 1996 and for the three- and six-month
periods then ended give effect to the Company's acquisition of all of the
outstanding stock of the Budget franchise in Phoenix, Arizona and VPSI, Inc.,
both of which were acquired in February 1996. The accompanying statement of
operations and statement of cash flows only give effect to these operations for
the period from their respective dates of acquisition through the end of the
period presented.
2. Acquisitions
Dayton Franchise - In January 1995, the Company purchased all of the outstanding
stock of Don Kremer, Inc. located in Dayton, Ohio, for $1.3 million. The
acquisition funding consisted of $650,000 cash and two notes totaling $650,000.
Charlotte Franchise - In January 1995, the Company purchased all of the
outstanding stock of MacKay Car & Truck Rentals, Inc. located in Charlotte,
North Carolina for approximately $8.4 million consisting of cash of $8.3 million
and 13,483 shares of Class A common stock.
Hartford Franchise - In March 1995, the Company purchased all of the outstanding
stock of Rental Car Resources, Inc. located in Hartford, Connecticut for
approximately $1.5 million by issuing 157,333 shares of Class A common stock.
OPCO Franchise - In October 1995, the Company purchased all of the outstanding
stock of BRAC-OPCO, Inc. which operates Budget franchises in the greater Los
Angeles area, excluding the vehicle rental operations at Los Angeles
International Airport, for approximately $11.2 million by issuing 1,050,000
shares of Class A common stock.
Acquisition of Van Pool Operations - In February 1996, the Company purchased for
a nominal amount all of the outstanding stock of VPSI, Inc. ("VPSI") located in
Detroit, Michigan. VPSI provides commuter van pooling services to business
commuters in 22 states, operating a rental fleet of approximately 3,300 vans as
of March 31, 1996.
Acquisition of Phoenix Franchise - In February 1996, the Company purchased all
of the outstanding stock of Arizona Rent-A-Car Systems, Inc. located in Phoenix,
Arizona for approximately $18 million consisting of cash of approximately $5.0
million, a promissory note of $10.0 million and 272,727 shares of Class A common
stock.
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If the acquisitions had occurred at the beginning of 1995, the Company's results
of operations would be as shown in the following table. These unaudited pro
forma results are not necessarily indicative of the actual results of operations
that would have occurred had the acquisitions actually been made at the
beginning of the respective years.
Six-month period ended June 30, 1996 1995
---- ----
(Dollars in thousands)
Operating revenue $ 170,565 $ 129,967
Income (loss) before provision for income taxes 2,821 (677)
Net income (loss) 1,693 (406)
Earnings (loss) per common share $ 0.23 $ (0.05)
3. Subsequent Events
On July 9, 1996, the Company sold 3,821,007 shares of Class A common stock at
$13.00 per share to investors in a public offering yielding proceeds, net of
underwriters' commissions, of $46.9 million to the Company.
On August 1, 1996, the Company acquired ValCar Rental Car Sales, Inc. for
$400,000 cash. ValCar owns and operates four retail vehicle sales facilities in
Indianapolis, Indiana, and was formerly owned by a director and officer of Team
Rental Group.
8
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
General
The Company's original operation, acquired in April 1987, was the Budget
franchise for the San Diego metropolitan area, exclusive of the airport
location, which it acquired in 1988. The Company acquired the Albany and
Rochester, New York franchises and the Richmond, Virginia franchise in 1991.
Concurrent with the Company's initial public offering on August 25, 1994, the
Company purchased the Budget operations in Philadelphia and Pittsburgh,
Pennsylvania and Cincinnati, Ohio. In November 1994, the Company acquired the
Fort Wayne, Indiana Budget franchise and opened its first retail car sales
facility in San Diego, California. The Company acquired the Dayton, Ohio and
Charlotte, North Carolina Budget franchises in January 1995, the Hartford,
Connecticut Budget franchise in March 1995 and the Los Angeles Budget franchise
in October 1995. During 1995, the Company opened four retail car sales
facilities, including locations in Philadelphia, Pennsylvania; Richmond,
Virginia; Charlotte, North Carolina; and a second location in San Diego,
California; and acquired retail car sales facilities in Dayton, Ohio and
Ontario, California. In February 1996, the Company acquired the Phoenix, Arizona
Budget franchise territory and VPSI, Inc., a commuter van pooling service with
operations in many regions throughout the United States.
Liquidity and Capital Resources
Historically, the Company's operations have been funded by cash provided from
operating activities and by financing provided by banks, automobile
manufacturers' captive finance companies and leasing companies. The Company's
existing indebtedness at June 30, 1996 has interest rates ranging from 6.1% to
9.5%. The Company intends to fund its operations through medium term notes,
revolving credit facilities with financial institutions for fleet financing and
working capital, as well as through other similar facilities and through
placements or offerings of additional debt and/or equity securities.
At June 30, 1996, the Company has $145.7 million borrowed under medium term
notes which are utilized to finance vehicles eligible for certain manufacturers'
guaranteed repurchase programs. Proceeds from the notes that are temporarily
unutilized for vehicle financing are maintained in restricted cash accounts with
the trustee. The notes are collateralized by the secured vehicles and the
restricted cash accounts. Rates on medium term notes at June 30, 1996 range from
6.1% to 6.8%.
The Company's other vehicle obligations consist of outstanding lines of credit
to purchase rental fleet and retail car sales inventory. Revolving credit
facilities are in place with various financial institutions with rates ranging
from 7.0% to 9.5% at June 30, 1996. Collateralized lines of credit at June 30,
1996 consist of $244 million for rental vehicles and $26 million for retail car
sales inventory with maturity dates ranging from July 1996 to July 1997. Vehicle
obligations are collateralized by revenue earning vehicles financed under these
credit facilities and proceeds from the sale, lease or rental of rental vehicles
and retail car sales inventory. Interest payments for rental fleet facilities
are due monthly at annual interest rates ranging from 7.0% to 9.5% at June 30,
1996. Management expects vehicle obligations will generally be repaid within one
year from the balance sheet date with proceeds received from either the
repurchase of the vehicles by the manufacturers in accordance with the terms of
the manufacturers' rental fleet programs or from the sale of the vehicles.
Monthly payments of interest only for retail car sales inventory obligations are
required at an annual interest rate of 8.5% at June 30, 1996. Retail car sales
inventory obligations are paid when the inventory is sold but in no event later
than 120 days after the date of purchase.
Working capital facilities with a combined available credit of up to $30,000,000
are for working capital and the purchase of retail car sales inventory, and bear
9
<PAGE>
interest payable monthly at rates that ranged from 8.0% to 11.25% at June 30,
1996. These facilities expire in November 1996. The facilities are
collateralized by accounts receivable, inventory, equipment, general
intangibles, investments and all other personal property of the Company and
guarantees of the Company's subsidiaries. Under the terms of one of the
agreements, the Company is required to pay commitment fees quarterly equal to
0.125% per annum on the maximum amount of credit available under the credit
facility and an annual agent fee of $50,000 as long as the facility has an
outstanding balance. This agreement is subject to certain covenants which
require the Company to maintain certain financial ratios and minimum tangible
net worth and prohibits the payment of cash dividends. At June 30, 1996, $30
million was outstanding under these working capital facilities. All such
outstanding balances were repaid in July 1996.
Change in Financial Condition
Total assets increased $96.5 million, or 25.0% from $386.3 million at December
31, 1995 to $482.8 million at June 30, 1996. This increase resulted primarily
from increases in revenue-earning vehicles of $117.7 million, franchise rights
of $12.6 million and other assets of $20.4 million that were primarily the
result of the acquisition activity discussed above, which was somewhat offset by
a decrease in cash and cash equivalents and restricted cash of $54.2 million
resulting from the use of cash to finance vehicle purchases in the first six
months of 1996. Total liabilities increased $89.5 million, or 26.0% from $344.7
million at December 31, 1995 to $434.3 million at June 30, 1996 due primarily to
an additional $84.1 million of net borrowings for financing vehicle acquisitions
and for financing the acquisitions in the first quarter of 1996 and increases in
accounts payable and other accrued liabilities of $5.4 million relating to the
increased size of the Company at June 30, 1996. The increase in stockholders'
equity of approximately $6.9 million resulted from the additional shares issued
in conjunction with the Arizona Rent a Car Systems, Inc. acquisition totaling
$2.7 million, additional paid-in capital from the issuance of stock warrants in
the amount of $0.7 million and net income of $3.5 million earned in the first
six months of 1996.
Results of Operations
General Operating Results. Net income for the first six months of 1996 increased
$.55 from a $.07 loss incurred in the first six months of 1995 to $.48 income
for the first six months of 1996. Net income for the second quarter of 1996 of
$0.30 per share represented a $.18 increase from the $0.12 per share earned in
the second quarter of 1995. Income before provision for income taxes increased
$2.5 million from $1.2 million in the second quarter of 1995 to $3.7 million
income in the second quarter of 1996. This increase was due to the Company's
acquisition activity and the growth of the Company's car sales operations from
four locations at June 30, 1995 to nine locations at June 30, 1996. Operating
income increased almost 170% to $10.8 million in the second quarter of 1996 as
compared to $4.0 million operating income earned in the comparable period of
1995. Operating income for the six-month period ended June 30, 1996 increased
$13.7 million, or 311%, to $18.1 million. The increase in operating income in
the second quarter was somewhat offset by an increase in net interest expense of
$4.3 million, or 154%, due primarily to an increase in the vehicle fleet due to
the acquisitions of the Budget franchises in Arizona and Southern California and
VPSI, and due to an increase in the provision for income taxes of $1.0 million
due to the enhanced profitability of the Company in 1996.
Operating Revenues. Vehicle rental revenues increased $35.4 million, or 149%, in
the second quarter of 1996 as compared to the comparable period of 1995. Such
revenues for the six-month period ended June 30, 1996 increased $62.7 million
from $41.1 million in 1995 to $103.8 million in the current year. The increase
in rental revenues is due primarily to the increase in the size of the Company
from operating 85 rental locations in eight franchise areas at June 30, 1995 to
operating 159 locations in thirteen franchise territories at June 30, 1996 and
to the acquisition of VPSI, Inc. in February 1996. This increased size resulted
10
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in an increase in the number of rental revenue days from 573,000 in the second
quarter of 1995 to 1,212,000 days in 1996. The average rental term increased
from 3.61 days in the second quarter of 1995 to 3.88 days in the comparable
period of 1996. Vehicle rental revenues also increased in the second quarter of
1996 due to the inclusion of $8.2 million of revenues earned by VPSI for which
there were no corresponding revenues in 1995. Revenues from the Company's retail
car sales operations increased $26.1 million from $8.5 million in the second
quarter of 1995 to $34.6 million in the comparable period of 1996, due to the
expansion of the Company's car sales facilities from four locations at June 30,
1995 to nine locations at June 30, 1996.
Operating Expenses. Operating expenses increased approximately $91.2 million, or
182% to $141.4 million for the six-month period ended June 30, 1996 as compared
to $50.2 million for the same period in 1995. The growth of the Company's
vehicle rental operations through the acquisitions discussed above was the
principal cause of all of the increases to the Company's operating expenses.
Vehicle depreciation increased approximately $16.5 million, or 142%, due to an
increase in fleet of 9,000 vehicles. Personnel costs increased approximately
144% in the first six months of 1996 as compared to the comparable period of
1995 due to an increase of approximately 1,300 employees since June 30, 1995.
Advertising expenses increased from $4.5 million to $10.6 million for the first
six months of 1996 due to the increase in the size of the rental operations and
due to the growth of the retail car sales operations from four markets at June
30, 1995 to nine markets at June 30, 1996. The retail car sales business
typically incurs greater advertising expense than the car rental business.
Facilities expense increased $4.9 million, or 107% due to the addition of 60
locations since June 30, 1995. Other operating expense increases were due to the
increased volume of rental business resulting from the 1995 and 1996
acquisitions.
Other (Income) Expense, net. Interest expense, net of interest income, increased
from $5.1 million for the first six months of 1995 to $12.2 million for the
first six months of 1996. Vehicle interest expense increased approximately $3.5
million in the second quarter of 1996 due to the increase in the size of the
Company's rental fleet from approximately 9,200 vehicles at June 30, 1995 to
approximately 18,200 vehicles at June 30, 1996. The Company's cost of funds
decreased approximately 0.6% per annum in the second quarter of 1996 as compared
to the second quarter of 1995, due primarily to the decrease in the LIBOR rate,
upon which most of the Company's debt is based. Nonvehicle interest and other
expense, net of interest income, increased approximately $764,000 in the second
quarter of 1996, from approximately $7,000 income in 1995 to $757,000 expense in
1996. This increase was due to an increase in the Company's borrowings under its
working capital facilities from $7 million at June 30, 1995 to $30 million at
June 30, 1996 due primarily to borrowings to fund the acquisitions of the Budget
franchises in Southern California and Arizona, and to a $134,000 reduction in
interest earned on the excess proceeds from the medium term note program
remaining available for vehicle financing in the second quarter of 1996, as the
Company had utilized a larger portion of its medium term note funds in the
second quarter of 1996 than in the comparable period of 1995.
Provision for income taxes. The provision for income taxes increased $2.6
million from a $0.3 million benefit for the first six months of 1995 to $2.3
million provision for the comparable period of 1996. The tax provision is
calculated at a rate of 40%. The increase in provision is due to the enhanced
profitability in the first six months of 1996 as compared to 1995.
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PART II - OTHER INFORMATION
ITEM 1 Legal Proceedings
Thereare no material pending legal proceedings to which Team Rental Group,
Inc. nor any of its subsidiaries is a party or to which any of their
property is subject.
ITEM 2 Changes in Securities
Not applicable.
ITEM 3 Default upon Senior Securities
Not applicable.
ITEM 4 Submission of Matters to a Vote of Security Holders
The annual meeting of shareholders was held on June 18, 1996 in Dayton,
Ohio for the purpose of electing the Board of Directors, approving an
amendment to the amended and restated certificate of incorporation and
approving an amendment to the Company's 1994 Incentive Stock Option Plan.
Proxies for the meeting were solicited pursuant to Section 14(a) of the
Securities Exchange Act of 1934 and there was no solicitation in opposition
to management's solicitations.
All of management's' nominees for directors as listed in the proxy
statement were elected with the following vote:
Director Shares Shares
Nominee Voted For Withheld
------- --------- --------
Sanford Miller 21,931,350 501
Jeffrey D. Congdon 21,931,350 501
John P. Kennedy 21,931,350 501
Ronald D. Agronin 21,931,350 501
James F. Calvano 21,931,350 501
Alan Liker 21,931,350 501
Jeffrey R. Mirkin 21,931,350 501
Stephen L. Weber 21,931,350 501
An amendment to the amended and restated certificate of incorporation deleting
Section 8 was approved with the following vote:
Shares Shares Shares
Voted For Voted Against Withheld
--------- ------------- --------
21,914,147 1,552 401
An amendment to the Company's 1994 Incentive Stock Option Plan was approved with
the following vote:
Shares Shares Shares
Voted For Voted Against Withheld
--------- ------------- --------
21,501,828 163,652 5,002
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ITEM 5 Other Information
Not applicable.
ITEM 6 Exhibits and Reports on Form 8-K
(a) Exhibits.
Exhibit 11.1 Earnings Per Share Computations
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
In a Form 8-KA dated February 27, 1996 and filed on May 13, 1996, the Company
filed under Item 7 the financial statements of Arizona Rent-A-Car Systems, Inc.
and the required pro forma financial information.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TEAM RENTAL GROUP, INC.
(Registrant)
Dated: August 13, 1996 By: /s/ Sanford Miller
--------------
Sanford Miller
Chairman of the Board and
Chief Executive Officer
Dated: August 13, 1996 By: /s/ Jeffrey D. Congdon
------------------
Jeffrey D. Congdon
Chief Financial Officer
14
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EXHIBIT 11.1
EARNINGS PER SHARE COMPUTATIONS
Six-Month Period Ended
June 30, June 30,
1996 1995
------------- -------------
PRIMARY EARNINGS PER SHARE: (Dollar and share amounts in 000's)
Net Income $ 3,523 ($ 403)
------------- -------------
Shares:
Weighted average common shares outstanding 7,343 6,091
Effect of shares issuable under stock option
plans and from stock purchase warrants,
based on the treasury stock method 70
------------- -------------
Adjusted common shares and equivalents 7,413 6,091
------------- -------------
Earnings per share - primary $ 0.48 ($ 0.07)
------------- -------------
FULLY DILUTED EARNINGS PER SHARE:
Net Income $ 3,523 ($ 403)
------------- -------------
Shares:
Weighted average common shares outstanding 7,343 6,091
Effect of shares issuable under stock option
plans and from stock purchase warrants,
based on the treasury stock method 154
------------- -------------
Adjusted common shares and equivalents 7,497 6,091
------------- -------------
Earnings per share - fully diluted $ 0.47 ($ 0.07)
------------- -------------
<PAGE>
EXHIBIT 11.1
EARNINGS PER SHARE COMPUTATIONS
Three-Month Period Ended
June 30, June 30,
1996 1995
------------- -------------
PRIMARY EARNINGS PER SHARE: (Dollar and share amounts in 000's)
Net Income $ 2,246 $ 743
------------- -------------
Shares:
Weighted average common shares outstanding 7,430 6,144
Effect of shares issuable under stock option
plans and from stock purchase warrants,
based on the treasury stock method 139
------------- -------------
Adjusted common shares and equivalents 7,569 6,144
------------- -------------
Earnings per share - primary $ 0.30 $ 0.12
------------- -------------
FULLY DILUTED EARNINGS PER SHARE:
Net Income $ 2,246 $ 743
------------- -------------
Shares:
Weighted average common shares outstanding 7,430 6,144
Effect of shares issuable under stock option
plans and from stock purchase warrants,
based on the treasury stock method 154
------------- -------------
Adjusted common shares and equivalents 7,584 6,144
------------- -------------
Earnings per share - fully diluted $0.30 $0.12
------------- -------------
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 13,848
<SECURITIES> 0
<RECEIVABLES> 24,310
<ALLOWANCES> 0<F1>
<INVENTORY> 353,523
<CURRENT-ASSETS> 391,681
<PP&E> 20,217<F2>
<DEPRECIATION> 0
<TOTAL-ASSETS> 482,791
<CURRENT-LIABILITIES> 30,492
<BONDS> 402,338
2,000
0
<COMMON> 74
<OTHER-SE> 46,464
<TOTAL-LIABILITY-AND-EQUITY> 482,791
<SALES> 159,528
<TOTAL-REVENUES> 159,528
<CGS> 47,295
<TOTAL-COSTS> 94,137
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 12,225
<INCOME-PRETAX> 5,871
<INCOME-TAX> 2,348
<INCOME-CONTINUING> 3,523
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,523
<EPS-PRIMARY> 0.48
<EPS-DILUTED> 0.47
<FN>
<F1>Receivables are reported net of allowances for doubtful accounts on the Balance
Sheet
<F2>Property, plant & equipment is reported net of accumulated depreciation on the
Balance Sheet
</FN>
</TABLE>
