Company: GPI
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001031203-25-000061
Chunk: 16

Company: GROUP 1 AUTOMOTIVE INC
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 1
Chunk 16
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 risk, an adjustment for company size risk and country risk adjustments for the U.K.Each of the significant assumptions to the fair value model are considered level 3 inputs within the fair value hierarchy as described further in Note 8. Financial Instruments and Fair Value Measurements. Developing these assumptions requires applying management’s knowledge of the industry, recent transactions and reasonable performance expectations for its operations.As a result of the quantitative assessment for the U.K. reporting unit as of August 31, 2025, the Company recorded a goodwill impairment charge of $93.0 million for the three months ended September 30, 2025.Based on the triggering event as described above, the Company examined its intangible franchise rights balance associated with the U.K. reporting unit and identified certain U.K. dealerships’ intangible franchise rights requiring further quantitative assessment.. To perform the intangible franchise rights quantitative assessment, the Company estimated the fair values of the respective franchise rights using a discounted cash flow, or income approach, following the income approach as described for Goodwill. This resulted in additional franchise rights impairment charges, unrelated to the OEM notification described above, of $5.4 million for the three months ended September 30, 2025, bringing total intangible franchise rights impairment charges, excluding impairments associated with restructuring charges, to $23.5 million and $23.9 million for the three and nine months ended September 30, 2025, respectively.

The impairment charges were recognized within Asset impairments in the Company’s Condensed Consolidated Statements of Operations. As of September 30, 2025, subsequent to the impairments described above, the U.K. reporting unit had $220.3 million and $121.9 million of goodwill and intangible franchise rights, respectively. 

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Table of Contents GROUP 1 AUTOMOTIVE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

5. RESTRUCTURING 

During the fourth quarter of 2024, the Company initiated a U.K.-wide restructuring plan (the “Restructuring Plan”) related to the integration activities of Inchcape Retail with existing U.K. operations. The Restructuring Plan consists of workforce realignment, including certain headcount reductions and strategic closing of certain facilities and dealerships. The Restructuring Plan is expected to continue throughout 2025, and the Company does not expect additional restructuring charges to be material. Any changes to the Company’s estimates or timing of