Company: GPI
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001031203-25-000061
Chunk: 66

Company: GROUP 1 AUTOMOTIVE INC
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 1
Chunk 66
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0 $76.3 $0.6 0.8 %Other interest expense, net$130.4 $102.5 $27.9 27.3 %Provision for income taxes $106.8 $133.5 $(26.7)(20.0)%

Depreciation and Amortization Expense

Depreciation and amortization expense for the Current Quarter and Current Year was higher compared to the Prior Year Quarter and Prior Year, primarily driven by acquired property and equipment in our U.S. and U.K. regions, as we continue to strategically add dealership related real estate and facilities to our investment portfolio and make improvements to our existing facilities intended to enhance the profitability of our dealerships and improve the overall customer experience. 

Asset Impairments

Asset impairments totaled $123.9 million in the Current Quarter and $124.6 million in the Current Year. During the Current Year, we recognized goodwill, intangible franchise rights and fixed asset impairment charges of $93.0 million, $23.9 million and $7.7 million, respectively, primarily in the U.K. reporting unit.

Refer to Note 4. Intangible Franchise Rights and Goodwill within our Notes to Condensed Consolidated Financial Statements for further discussion.

Restructuring Charges

During the Current Quarter and Current Year, we incurred $1.6 million and $20.3 million of restructuring charges in the U.K., respectively. Restructuring charges primarily consist of planned workforce realignment, strategic closing of certain facilities and systems integrations, among other efforts to increase operational efficiency and profitability in connection with the integration of the Inchcape Retail acquisition with our U.K. business. The Company anticipates implementing further restructuring plans in the U.K. in future periods to reduce costs.

Refer to Note 5. Restructuring within our Notes to Condensed Consolidated Financial Statements for further discussion of our restructuring plan.

43

Floorplan Interest Expense 

Our floorplan interest expense fluctuates with changes in our outstanding borrowings and associated interest rates, which are based on SOFR, the U.S. prime rate or other benchmark rates. Outstanding borrowings largely fluctuate based on our levels of new and used vehicle inventory. To mitigate the impact of interest rate fluctuations, we employ an interest rate hedging strategy, whereby we swap variable interest rate exposure on a portion of our borrowings for a fixed interest rate.

Total floorplan interest expense during the Current Quarter decreased $7.5 million