Company: GPI
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0001031203-25-000013
Chunk: 133

Company: GROUP 1 AUTOMOTIVE INC
Filing Date: 2025-02-14
Form: 10-K
Item: Item 7
Chunk 133
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 decrease in the gain recognized on the de-designation of a mortgage interest rate swap as compared to the Prior Year of approximately $3.8 million. Refer to Note 15. Debt within our Notes to Consolidated Financial Statements for additional discussion of our debt. Refer to Note 8. Financial Instruments and Fair Value Measurements within our Notes to the Consolidated Financial Statements for additional discussion of the de-designation of the mortgage interest rate swap. 

Provision for Income Taxes

Provision for income taxes from continuing operations during the Current Year decreased $36.7 million, or 18.5%, as compared to the Prior Year. During the Current Year and Prior Year, we recorded a tax provision from continuing operations of $161.5 million and $198.2 million, respectively. The year-over-year tax expense decrease was primarily due to lower pre-tax book income. 

The 2024 effective tax rate of 24.5% was lower than the 2023 effective tax rate of 24.8%. The tax rate decrease was primarily due to the mix of earnings and an increase in tax credits.

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.  

For further discussion, please refer to Note 16. Income Taxes within our Notes to Consolidated Financial Statements.

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 14. Floorplan Notes Payable within our Notes to 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.

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Available Liquidity Resources

We had the following sources of liquidity available (in millions): 

December 31, 2024Cash and cash equivalents$34.4 Floorplan offset accounts288.2 Available capacity under Acquisition Line893.2 Total liquidity$1,215.8 

Cash Flows

We arrange our new and used vehicle inventory floorplan financing through lenders affiliated with our