Company: GPI
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001031203-25-000061
Chunk: 127

Company: GROUP 1 AUTOMOTIVE INC
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 2
Chunk 127
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 or 45.7%, as compared to the Prior Year Quarter. For the Current Year, our provision for income taxes of $106.8 million decreased by $26.7 million, or 20.0%, as compared to the Prior Year. The tax expense decrease in the Current Quarter and Current Year, as compared to the Prior Year Quarter and Prior Year, was primarily due to lower pre-tax income. Our Current Quarter effective tax rate of 63.7% was higher than the Prior Year Quarter’s effective tax rate of 26.6%, primarily due to the non-deductible U.K. goodwill impairment of $93.0 million in the Current Quarter compared to the Prior Year Quarter.

We believe that it is more-likely-than-not that our deferred tax assets, net of valuation allowances provided, will be realized, based primarily on assumptions of our future taxable income, considering future reversals of existing taxable temporary differences. 

Liquidity and Capital Resources 

Our liquidity and capital resources are primarily derived from cash on hand, cash temporarily invested as a pay down of our U.S. Floorplan Line and FMCC Facility levels (refer to Note 11. Floorplan Notes Payable within our Notes to Condensed Consolidated Financial Statements for additional information), cash from operations, borrowings under our credit facilities, working capital, dealership and real estate acquisition financing and proceeds from debt and equity offerings. We anticipate we will generate sufficient cash flows from operations, coupled with cash on hand and available borrowing capacity under our credit facilities, to fund our working capital requirements, service our debt and meet any other recurring operating expenditures.

Available Liquidity Resources

We had the following sources of liquidity available (in millions): September 30, 2025Cash and cash equivalents$30.8 Floorplan offset accounts402.9Available capacity under Acquisition Line555.2 Total liquidity$988.9 

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Cash Flows

We arrange our new and used vehicle inventory floorplan financing through lenders affiliated with our vehicle manufacturers and our Revolving Credit Facility. In accordance with U.S. GAAP, we report floorplan financed with lenders affiliated with our vehicle manufacturers (excluding the cash flows from or to manufacturer-affiliated lenders participating in our syndicated lending group) within Cash Flows from Operating Activities in the Condensed Consolidated Statements of Cash Flows. We report floorplan financed with the Revolving Credit Facility (including the cash flows from or to manufacturer-affiliated lenders participating in the facility) and other credit facilities in the U.K.