Avis Budget Group Reports Second Quarter 2013 Results

Avis Budget Group Reports Second Quarter 2013 Results

  *Revenue increased 7% to $2.0 billion.
    
  *Pricing in North America increased 1% year-over-year.
    
  *Adjusted EBITDA was $179 million, excluding certain items.
    
  *Diluted earnings per share were $0.50, excluding certain items, on a GAAP
    net loss of $28 million.
    
  *Company updates its full-year earnings outlook.
    
  *Company authorizes $200 million share repurchase program.

PARSIPPANY, N.J., Aug. 6, 2013 (GLOBE NEWSWIRE) -- Avis Budget Group, Inc.
(Nasdaq:CAR) today reported results for its second quarter ended June 30,
2013. For the quarter, the Company reported revenue of $2.0 billion, a 7%
increase compared with the prior-year second quarter. Excluding certain items,
Adjusted EBITDA declined 33% to $179 million. The Company reported net income
of $58 million, excluding certain items, and a GAAP net loss of $28 million
due to debt-extinguishment expenses, transaction-related charges and
restructuring costs.

"Our second quarter results reflected volume growth in all regions and
increased pricing in North America, offset by the significant year-over-year
increase in North American fleet costs occasioned by the significant car-sale
gains and depreciation adjustments recorded in the comparable quarter of last
year," said Ronald L. Nelson, Avis Budget Group Chairman and Chief Executive
Officer. "Going forward, we expect volume and pricing trends in North America
to remain favorable and fleet costs to stabilize. In addition, summer trends
in Europe are also favorable, while the integration of Zipcar continues to
progress as planned, with both cost savings and incremental revenue
opportunities being realized."

Zipcar, acquired by the Company in March 2013, contributed approximately $76
million to revenues and $6 million to Adjusted EBITDA in the second quarter.

The Company also today announced that its Board of Directors has authorized a
new share repurchase program that will enable it to purchase up to $200
million of its common stock. The amount and timing of specific repurchases are
subject to market conditions, Company performance and stock price, applicable
legal requirements and other factors. Repurchases may be conducted in the open
market or in privately negotiated transactions. The Company intends to fund
share repurchases primarily with cash flow from operations and indicated that
the share repurchase authorization does not represent any change in its
targeted leverage ratios.

"Today's share-repurchase announcement reflects the confidence we have in our
business and our prospects," Mr. Nelson said. "We have reduced our diluted
share count by more than 16 million shares as a result of having repurchased
$270 million of our convertible debt in 2012 and 2013, and we remain committed
to delivering value to our shareholders, while also maintaining a prudent
capital structure and flexibility to execute on our strategic objectives."

Executive Summary

Total Company revenue increased 7% in second quarter 2013 compared to second
quarter 2012 primarily due to the acquisition of Zipcar and a 3% increase in
rental days. Second quarter Adjusted EBITDA decreased 33% to $179 million,
excluding certain items, primarily due to higher fleet costs in North America.

Business Segment Discussion

The following discussion of second quarter operating results focuses on
revenue and Adjusted EBITDA for each of our operating segments. Revenue and
Adjusted EBITDA are expressed in millions.

North America

(Consisting of the Company's U.S. car rental operations, Canadian vehicle
rental operations and Zipcar business)

               2013    2012     % change
Revenue         $1,292 $1,184 9%
Adjusted EBITDA $114  $184   (38%)

Revenue increased 9% primarily due to the acquisition of Zipcar, a 2% increase
in volume and a 1% increase in pricing, including a 4% increase in leisure
pricing. Adjusted EBITDA decreased 38% primarily due to a 60%, or $120
million, increase in per-unit fleet costs, partially offset by higher pricing,
lower operating costs and lower vehicle interest expense. Excluding the
acquisition of Zipcar, revenue increased 3% and Adjusted EBITDA decreased 41%.
Adjusted EBITDA includes $1 million of restructuring costs in second quarter
2013.

International

(Consisting of the Company's international vehicle rental operations)

               2013   2012   % change
Revenue         $608 $579 5%
Adjusted EBITDA $53  $59  (10%)

Revenue increased 5% primarily due to a 6% increase in rental days, partially
offset by a 2% decline in pricing. The October 2012 acquisition of Apex Car
Rentals contributed $7 million to revenue. Adjusted EBITDA declined $6 million
primarily reflecting inflationary increases in operating costs and increased
marketing commissions in Europe. Adjusted EBITDA includes $6 million of
restructuring costs in second quarter 2013 compared to $12 million in second
quarter 2012.

Truck Rental

(Consisting of the Company's U.S. truck rental operations)

               2013   2012   % change
Revenue         $102 $103 (1%)
Adjusted EBITDA $8   $17  (53%)

Truck Rental revenue decreased 1% due to a 7% decrease in our truck rental
fleet and a corresponding decrease in volume, largely offset by a 9% increase
in pricing. Adjusted EBITDA declined by $9 million primarily due to our
previously announced initiative to reposition the business, which resulted in
$8 million of restructuring costs.

Other Items

  *Acquisition of Payless Car Rental - The Company announced in July that it
    had acquired Payless Car Rental, the sixth largest car rental company in
    North America. The addition of the Payless brand, which generated
    approximately $80 million in annual revenue in 2012, gives Avis Budget
    Group a meaningful position in the deep-value segment of the car rental
    market.
    
  *Debt Refinancing - In June, the Company refinanced its existing $900
    million in term loan borrowings due 2019 with $1 billion in new term loan
    borrowings due 2019, while also reducing the interest rate on such loans
    by 75 basis points. The Company also redeemed all of its $124 million
    outstanding 9.625% senior notes due 2018 and $100 million of its
    floating-rate senior notes due 2014.
    
  *Revolving Credit Facility Extension - In August, the Company amended its
    principal corporate revolving credit facility, extending its maturity from
    2016 to 2018, expanding its size from $1.5 billion to $1.65 billion, and
    reducing the interest rate under the facility by 75 basis points. As of
    June 30, 2013, the Company had no borrowings and $1.1 billion of letters
    of credit outstanding under the facility.

Outlook

The Company today updated its estimates of its full-year 2013 results based on
current economic conditions.

The Company continues to expect its full-year 2013 revenue to be approximately
$7.8 billion to $8.0 billion, a 6% to 9% increase compared to 2012. The
Company now expects its Adjusted EBITDA to be approximately $750 million to
$800 million, excluding certain items. The narrowing of the Company's
projected Adjusted EBITDA range from its initial expectation reflects
better-than-expected pricing trends in North America, offset by lower vehicle
residual values in North America and weak economic conditions in Europe and
Australia.

The Company now expects per-unit fleet costs in its North America segment to
increase approximately 25%, to roughly $300 per month in 2013. Total Company
fleet costs are expected to be $285 to $295 per unit per month in 2013, an
increase of approximately 15% to 20% compared to 2012.

The Company expects interest expense related to corporate debt to be
approximately $230 million, a decline of $30 million compared to 2012. The
Company continues to expect that its 2013 non-vehicle depreciation and
amortization expense (excluding the amortization of intangible assets related
to the acquisitions of Avis Europe and Zipcar) will be approximately $130
million to $135 million. As a result, the Company estimates that its pretax
income will be approximately $385 million to $440 million, excluding certain
items.

The Company continues to expect that its effective tax rate in 2013 will be
approximately 37% to 38%, excluding certain items, and that its diluted share
count will be approximately 117 to 118 million. Based on these expectations,
the Company estimates that its 2013 diluted earnings per share, excluding
certain items, will be approximately $2.05 to $2.35.

Investor Conference Call

Avis Budget Group will host a conference call to discuss second quarter
results on August 7, 2013, at 8:30 a.m. (ET). Investors may access the call
live at ir.avisbudgetgroup.com or by dialing (630) 395-0021 and providing the
access code "Avis Budget." Investors are encouraged to dial in approximately
10 minutes prior to the call. A web replay will be available at
ir.avisbudgetgroup.com following the call. A telephone replay will be
available from 11:00 a.m. (ET) on August 7 until 8:00 p.m. (ET) on August 21
at (203) 369-1043, access code: "Avis Budget."

About Avis Budget Group, Inc.

Avis Budget Group, Inc. is a leading global provider of vehicle rental
services, both through its Avis and Budget brands, which have more than 10,000
rental locations in approximately 175 countries around the world, and through
its Zipcar brand, which is the world's leading car sharing network, with more
than 810,000 members. Avis Budget Group operates most of its car rental
offices in North America, Europe and Australia directly, and operates
primarily through licensees in other parts of the world. Avis Budget Group has
approximately 30,000 employees and is headquartered in Parsippany, N.J. More
information is available at www.avisbudgetgroup.com.

Forward-Looking Statements

Certain statements in this press release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements. Statements preceded by, followed by or that
otherwise include the words "believes", "expects", "anticipates", "intends",
"projects", "estimates", "plans", "may increase", "forecast" and similar
expressions or future or conditional verbs such as "will", "should", "would",
"may" and "could" are based upon then current assumptions and expectations and
are generally forward-looking in nature and not historical facts. Any
statements that refer to outlook, expectations or other characterizations of
future events, circumstances or results, including all statements related to
future results, future fleet costs, future rental volume and pricing trends,
effective tax rates, acquisition synergies, cost-saving initiatives and share
repurchases are also forward-looking statements.

Various risks that could cause future results to differ from those expressed
by the forward-looking statements included in this press release include, but
are not limited to, the Company's ability to promptly and effectively
integrate the businesses of Zipcar, Payless and Avis Budget, any change in
economic conditions generally, particularly during our peak season or in key
market segments, the high level of competition in the vehicle rental industry,
a change in our fleet costs as a result of a change in the cost for new
vehicles and/or the value of used vehicles, disruption in the supply of new
vehicles, disposition of vehicles not covered by manufacturer repurchase
programs, the financial condition of the manufacturers that supply our rental
vehicles which could impact their ability to perform their obligations under
our repurchase and/or guaranteed depreciation arrangements, any change in
travel demand, including any change in airline passenger traffic, any
occurrence or threat of terrorism, a significant increase in interest rates or
borrowing costs, our ability to obtain financing for our global operations,
including the funding of our vehicle fleet via the asset-backed securities
market, any changes to the cost or supply of fuel, any fluctuations related to
the mark-to-market of derivatives which hedge our exposure to exchange rates,
interest rates and fuel costs, the Company's ability to meet the financial and
other covenants contained in the agreements governing our indebtedness, risks
associated with litigation, regulation or governmental or regulatory inquiries
or investigations involving the Company, and the Company's ability to
accurately estimate its future results and implement its strategy for cost
savings and growth. Other unknown or unpredictable factors could also have
material adverse effects on Avis Budget Group's performance or achievements.
In light of these risks, uncertainties, assumptions and factors, the
forward-looking events discussed in this press release may not occur. You are
cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date stated, or if no date is stated, as of the
date of this press release. Important assumptions and other important factors
that could cause actual results to differ materially from those in the
forward-looking statements are specified in Avis Budget Group's Annual Report
on Form 10-K for the year ended December 31, 2012 and Quarterly Report on Form
10-Q for the quarter ended March 31, 2013, included under headings such as
"Forward-Looking Statements", "Risk Factors" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations", and in other
filings and furnishings made by the Company with the SEC from time to time.
Except for the Company's ongoing obligations to disclose material information
under the federal securities laws, the Company undertakes no obligation to
release publicly any revisions to any forward-looking statements, to report
events or to report the occurrence of unanticipated events unless required by
law.

This release includes certain financial measures such as Adjusted EBITDA,
pretax income and diluted earnings per share, which exclude certain items
under each measure and are not considered generally accepted accounting
principles ("GAAP") measures as defined under SEC rules. Important information
regarding such measures is contained on Table 1 and Table 5 to this release.
The Company believes that these non-GAAP measures are useful in measuring the
comparable results of the Company period-over-period. The GAAP measures most
directly comparable to Adjusted EBITDA, pretax income and diluted earnings per
share, excluding certain items under each measure, are net income, pretax
income and diluted earnings per share. Because of the forward-looking nature
of the Company's forecasted non-GAAP Adjusted EBITDA, pretax income and
diluted earnings per share, excluding certain items, specific quantifications
of the amounts that would be required to reconcile forecasted net income,
pretax income and diluted earnings per share are not available. The Company
believes that there is a degree of volatility with respect to certain of the
Company's GAAP measures which preclude the Company from providing accurate
forecasted GAAP to non-GAAP reconciliations. Based on the above, the Company
believes that providing estimates of the amounts that would be required to
reconcile the range of the non-GAAP Adjusted EBITDA, pretax income and diluted
earnings per share, excluding certain items, to forecasted net income, pretax
income, and diluted earnings per share would imply a degree of precision that
would be confusing or misleading to investors for the reasons identified
above.

                                                                 Table 1
Avis Budget Group, Inc.
SUMMARY DATA SHEET
(In millions, except per share data)
                                                                 
                                                                 
                     Three Months Ended June 30,    Six Months Ended June 30,
                     2013        2012       %       2013     2012     %
                                             Change                    Change
Income Statement and                                              
Other Certain Items
Net revenues         $2,002    $1,866   7%      $3,693 $3,489 6%
Adjusted EBITDA       164        254       (35%)   247     366     (33%)
(non-GAAP)
Income (loss) before  (38)       129        *       (95)    102      *
income taxes
Net income (loss)     (28)       79        *       (74)    56      *
Earnings (loss) per   (0.26)     0.66      *       (0.69)  0.47    *
share - Diluted
                                                                 
Excluding Certain                                                 
Items (non-GAAP) (A)
Net revenues         $2,002    $1,866   7%      $3,693 $3,489 6%
Adjusted EBITDA       179        266       (33%)   272     385     (29%)
Income before income  93         171        (46%)   98      190      (48%)
taxes
Net income            58         112        (48%)   67      126      (47%)
Earnings per share -  0.50       0.94      (47%)   0.58    1.04     (44%)
Diluted
                                                                 
                     As of                                        
                      June 30,    December
                     2013        31,                               
                                  2012
Balance Sheet Items                                               
Cash and cash         $503      $606                            
equivalents
Vehicles, net         12,099     9,274                            
Debt under vehicle    9,357      6,806                            
programs
Corporate debt        3,416      2,905                            
Stockholders' equity  646        757                              
                                                                 
Segment Results                                                   
                     Three Months Ended June 30,    Six Months Ended June 30,
                     2013        2012       %       2013     2012     %
                                             Change                    Change
Net Revenues                                                      
North America         $1,292    $1,184   9%      $2,392 $2,222 8%
International        608        579       5%      1,123   1,089   3%
Truck Rental          102        103       (1%)    178     177     1%
Corporate and Other   -           -          *       -        1       *
Total Company         $2,002    $1,866   7%      $3,693 $3,489 6%
                                                                 
Adjusted EBITDA (B)                                               
North America         $114      $184     (38%)   $205   $277   (26%)
International        53         59        (10%)   67      81      (17%)
Truck Rental          8          17        (53%)   (2)     18      *
Corporate and Other   (11)       (6)       *       (23)    (10)    *
Total Company         $164      $254     (35%)   $247   $366   (33%)
                                                                 
Reconciliation of Adjusted EBITDA                                  
to Pretax Income (Loss)
Total Company         $164      $254            $247   $366   
Adjusted EBITDA
Less: Non-vehicle
related depreciation  37         29               71      62      
and amortization
Interest expense
related to corporate                                              
debt, net:
Interest expense     55         69               114     142     
Early extinguishment  91         23               131     50      
of debt
Transaction-related   19         4                26      10      
costs
Income (loss) before  $(38)     $129     *       $(95)  $102   *
income taxes
_________                                                         
* Not meaningful.                                                 
(A) During the three and six months ended June 30, 2013, we recorded certain
items of $131 million and $193 million ($86 million and $141 million, net of
tax), respectively. For the three months ended June 30, 2013, these items
consisted of $91 million ($56 million, net of tax) for costs related to the
early extinguishment of corporate debt, $19 million ($16 million, net of tax)
for transaction-related costs primarily related to the integration of Avis
Europe and the acquisition and integration of Zipcar, $15 million ($10
million, net of tax) in restructuring expenses and $6 million ($4 million, net
of tax) for purchase-accounting effects related to the acquisitions of Avis
Europe and Zipcar. For the six months ended June 30, 2013, these items
consisted of $131 million ($95 million, net of tax) for costs related to the
early extinguishment of corporate debt, $26 million ($23 million, net of tax)
for transaction-related costs primarily related to the integration of Avis
Europe and the acquisition of Zipcar, $25 million ($16 million, net of tax) in
restructuring expenses and $11 million ($7 million, net of tax) for
purchase-accounting effects related to the acquisitions of Avis Europe and
Zipcar.
During the three and six months ended June 30, 2012, we recorded certain items
of $42 million and $88 million ($33 million and $70 million, net of tax),
respectively. During the three months ended June 30, 2012, these items
consisted of $23 million ($21 million, net of tax) for the early
extinguishment of corporate debt, $12 million ($8 million, net of tax) in
restructuring expenses, $4 million ($2 million, net of tax) of
transaction-related costs related to the integration of Avis Europe and $3
million ($2 million, net of tax) for amortization expense related to
intangible assets recognized in the Avis Europe acquisition. During the six
months ended June 30, 2012, certain items consisted of $50 million ($44
million, net of tax) for the early extinguishment of corporate debt, $19
million ($13 million, net of tax) in restructuring expenses, $10 million ($7
million, net of tax) in transaction-related costs related to the integration
of Avis Europe and $9 million ($6 million, net of tax) for amortization
expense related to the intangible assets recognized in the Avis Europe
acquisition.
(B) See Table 5 for a description of Adjusted EBITDA. Adjusted EBITDA includes
stock-based compensation expense and deferred financing fee amortization of
$12 million and $11 million in second quarter 2013 and 2012, respectively, and
$22 million and $21 million in the six months ended June 30, 2013 and 2012,
respectively.

                                                                
                                                                Table 2
Avis Budget Group, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
                                                                
                                                                
                              Three Months Ended June Six Months Ended June
                               30,                     30,
                              2013         2012        2013        2012
Revenues                                                         
Vehicle rental                 $1,438     $1,334    $2,654    $2,502
Other                          564         532        1,039      987
Net revenues                   2,002       1,866      3,693      3,489
                                                                
Expenses                                                         
Operating                      1,007       953        1,937      1,847
Vehicle depreciation and lease 476         334        863        652
charges, net
Selling, general and           274         233        498        452
administrative
Vehicle interest, net          66          80         123        153
Non-vehicle related            37          29         71         62
depreciation and amortization
Interest expense related to                                      
corporate debt, net:
Interest expense             55          69         114        142
Early extinguishment of debt  91          23         131        50
Transaction-related costs      19          4          26         10
Restructuring expense          15          12         25         19
Total expenses                 2,040       1,737      3,788      3,387
                                                                
Income (loss) before income    (38)        129        (95)       102
taxes
Provision for (benefit from)   (10)        50         (21)       46
income taxes
Net income (loss)              $(28)      $79       $(74)     $56
                                                                
Earnings (loss) per share                                        
Basic                          $(0.26)    $0.74     $(0.69)   $0.52
Diluted                        $(0.26)    $0.66     $(0.69)   $0.47
                                                                
Weighted average shares                                          
outstanding
Basic                          108.4       106.7      108.0      106.3
Diluted                        108.4       121.9      108.0      124.8

                                                                
                                                                Table 3
Avis Budget Group, Inc.
SEGMENT REVENUE DRIVER ANALYSIS

                                                                
                  Three Months Ended June 30,    Six Months Ended June 30,
                  2013       2012      % Change  2013      2012      % Change
CAR RENTAL                                                       
North America                                                    
Segment (A)
Rental Days        23,016     22,570    2%        42,739    42,010    2%
(000's)
Time and Mileage   $39.26   $38.75  1%        $40.22  $39.23  3%
Revenue per Day
Average Rental     358,943   348,730  3%        335,773  326,849  3%
Fleet
                                                                
International                                                    
Segment
Rental Days        9,312      8,813     6%        16,812    16,152    4%
(000's)
Time and Mileage
Revenue per Day    $41.79   $42.76  (2%)      $42.73  $44.04  (3%)
(B)
Average Rental     146,538   141,448  4%        134,394  129,486  4%
Fleet
                                                                
Total Car Rental                                                 
(A)
Rental Days        32,328    31,383   3%        59,551   58,162   2%
(000's)
Time and Mileage   $39.99   $39.88  0%        $40.93  $40.56  1%
Revenue per Day
Average Rental     505,481   490,178  3%        470,167  456,335  3%
Fleet
                                                                
TRUCK RENTAL                                                     
SEGMENT
Rental Days        1,007      1,101     (9%)      1,860     1,978     (6%)
(000's)
Time and Mileage   $81.90   $75.23  9%        $76.91  $72.27  6%
Revenue per Day
Average Rental     25,138    26,925   (7%)      25,885   26,026   (1%)
Fleet
_________                                                        
Rental days and time and mileage revenue per day are calculated based on the
actual rental of the vehicle during a 24-hour period. Our calculation of
rental days and time and mileage revenue per day may not be comparable to the
calculation of similarly-titled statistics by other companies.
(A) Amounts exclude Zipcar.
(B) Excluding currency exchange effects, time and mileage revenue per day
decreased 3 percentage points in the three and six months ended June 30, 2013.

                                                         
                                                         Table 4
Avis Budget Group, Inc.
CONSOLIDATED CONDENSED SCHEDULES OF CASH FLOWS AND FREE CASH FLOWS
(In millions)
                                                         
CONSOLIDATED CONDENSED SCHEDULE OF CASH FLOWS
                                                         
                                                         Six Months Ended
                                                          June 30, 2013
Operating Activities                                      
Net cash provided by operating activities                 $874
                                                         
Investing Activities                                      
Net cash used in investing activities exclusive of        (475)
vehicle programs
Net cash used in investing activities of vehicle programs (2,983)
Net cash used in investing activities                     (3,458)
                                                         
Financing Activities                                      
Net cash provided in financing activities exclusive of    382
vehicle programs
Net cash provided by financing activities of vehicle      2,116
programs
Net cash provided by financing activities                 2,498
                                                         
Effect of changes in exchange rates on cash and cash      (17)
equivalents
Net change in cash and cash equivalents                   (103)
Cash and cash equivalents, beginning of period            606
Cash and cash equivalents, end of period                  $503
                                                         
                                                         
CONSOLIDATED SCHEDULE OF FREE CASH FLOWS (A)
                                                         Six Months Ended
                                                          June 30, 2013
Pretax loss                                               $(95)
Add-back of non-vehicle related depreciation and          71
amortization
Add-back of debt extinguishment costs                     131
Add-back of transaction-related costs                     26
Working capital and other                                (55)
Capital expenditures                                      (56)
Tax payments, net of refunds                             (23)
Vehicle programs and related (B)                          20
Free Cash Flow                                            19
                                                         
Acquisition and related payments, net of acquired cash    (495)
(C)
Borrowings, net of debt repayments                        397
Transaction-related payments                              (28)
Financing costs, foreign exchange effects and other       4
Net change in cash and cash equivalents (per above)       $(103)
_____________________________                             
(A) See Table 5 for a description of Free Cash Flow.
(B) Includes vehicle-backed borrowings (repayments) that are incremental to
vehicle-backed borrowings (repayments) required to fund incremental (reduced)
vehicle and vehicle-related assets.
(C) Includes acquisition-related payments incurred as a result of the
acquisition of Zipcar.
                                                         
RECONCILIATION OF FREE CASH FLOW TO NET CASH PROVIDED BY OPERATING ACTIVITIES
                                                         
                                                         Six Months Ended
                                                          June 30, 2013
Free Cash Flow (per above)                                $19
Investing activities of vehicle programs                  2,983
Financing activities of vehicle programs                  (2,116)
Capital expenditures                                      56
Proceeds received on asset sales                          (7)
Change in restricted cash                                 (14)
Acquisition-related payments                              (19)
Transaction-related payments                              (28)
Net Cash Provided by Operating Activities (per above)     $874

                                                         
                                                         Table 5
Avis Budget Group, Inc.
DEFINITIONS AND RECONCILIATIONS OF NON-GAAP MEASURES
(In millions, except per share data)
                                                         
The accompanying press release includes certain non-GAAP (generally accepted
accounting principles) financial measures as defined under SEC rules. To the
extent not provided in the press release or accompanying tables, we have
provided below the reasons we present these non-GAAP financial measures, a
description of what they represent and a reconciliation to the most comparable
financial measure calculated and presented in accordance with GAAP.
                                                         
DEFINITIONS
Adjusted EBITDA                                           
The accompanying press release presents Adjusted EBITDA, which represents
income before non-vehicle related depreciation and amortization, any
impairment charge, transaction-related costs, non-vehicle related interest,
transaction-related costs and income taxes. We believe that Adjusted EBITDA is
useful as a supplemental measure in evaluating the aggregate performance of
our operating businesses. Adjusted EBITDA is the measure that is used by our
management, including our chief operating decision maker, to perform such
evaluation. It is also a component of our financial covenant calculations
under our credit facilities, subject to certain adjustments. Adjusted EBITDA
should not be considered in isolation or as a substitute for net income (loss)
or other income statement data prepared in accordance with GAAP and our
presentation of Adjusted EBITDA may not be comparable to similarly-titled
measures used by other companies.
A reconciliation of Adjusted EBITDA to income (loss) before income taxes can
be found on Table 1 and a reconciliation of income (loss) before income taxes
to net income (loss) can be found on Table 2.
                                                         
Certain items                                             
The accompanying press release and tables present Adjusted EBITDA, loss before
income taxes, net loss and diluted earnings per share for the three months
ended June 30, 2013, excluding certain items. For the three months ended June
30, 2013, these items consisted of $91 million ($56 million, net of tax) for
costs related to the early extinguishment of corporate debt, $19 million ($16
million, net of tax) for transaction-related costs primarily related to the
integration of Avis Europe and the acquisition and integration of Zipcar, $15
million ($10 million, net of tax) in restructuring expenses and $6 million ($4
million, net of tax) for purchase-accounting effects related to the
acquisitions of Avis Europe and Zipcar.
For the six months ended June 30, 2013, these items consisted of $131 million
($95 million, net of tax) for costs related to the early extinguishment of
corporate debt, $26 million ($23 million, net of tax) for transaction-related
costs primarily related to the integration of Avis Europe and the acquisition
and integration of Zipcar, $25 million ($16 million, net of tax) in
restructuring expenses and $11 million ($7 million, net of tax) for
purchase-accounting effects related to the acquisitions of Avis Europe and
Zipcar.
We believe that the measures referred to above are useful as supplemental
measures in evaluating the aggregate performance of the Company. We exclude
restructuring-related expenses, costs related to early extinguishment of debt
and other certain items as such items are not representative of the results of
operations of our business for the three and six months ended June 30, 2013.
                                                         
Reconciliation of Avis Budget Group, Inc. Adjusted EBITDA, excluding certain
items to net loss:
                                                         
                                    Three Months Ended    Six Months Ended
                                     June 30, 2013         June 30, 2013
Adjusted EBITDA, excluding certain   $179                $272
items
                                                         
Less: Non-vehicle related
depreciation and amortization                             
(excluding
acquisition-related amortization     31                   60
expense)
Interest expense related to corporate debt, net (excluding 
early
extinguishment of debt)              55                   114
Income before income taxes,          93                   98
excluding certain items
                                                         
Less certain items:                                       
Early extinguishment of debt         91                   131
Transaction-related costs            19                   26
Restructuring expense                15                   25
Acquisition-related amortization     6                    11
expense
Loss before income taxes             (38)                 (95)
Benefit from income taxes            (10)                 (21)
Net loss                             $(28)               $(74)
                                                         
Reconciliation of net income, excluding certain items to net loss:
                                                         
Net income, excluding certain items  $58                 $67
Less certain items, net of tax:                           
Early extinguishment of debt         56                   95
Transaction-related costs            16                   23
Restructuring expense                10                   16
Acquisition-related amortization     4                    7
expense
Net loss                             $(28)               $(74)
                                                         
Earnings per share, excluding        $0.50               $0.58
certain items (diluted)
                                                         
Loss per share (diluted)             $(0.26)             $(0.69)
                                                         
Shares used to calculate earnings
per share, excluding certain items   116.3                117.2
(diluted)
                                                         
The accompanying press release and tables present Adjusted EBITDA, income
before income taxes, net income and diluted earnings per share for the three
and six months ended June 30, 2012, excluding certain items. For the three
months ended June 30, 2012, certain items consisted of $23 million ($21
million, net of tax) of expense for the early extinguishment of corporate
debt, $12 million ($8 million, net of tax) in restructuring expenses, $4
million ($2 million, net of tax) of transaction-related costs related to the
integration of the operations of Avis Europe and $3 million ($2 million, net
of tax) for amortization expense related to intangible assets recognized in
the Avis Europe acquisition.
For the six months ended June 30, 2012, certain items consisted of $50 million
($44 million, net of tax) of expense for the early extinguishment of corporate
debt, $19 million ($13 million, net of tax) in restructuring expenses, $10
million ($7 million, net of tax) of transaction-related costs related to the
integration of the operations of Avis Europe and $9 million ($6 million, net
of tax) for amortization expense related to intangible assets recognized in
the Avis Europe acquisition.
We believe that the measures referred to above are useful as supplemental
measures in evaluating the aggregate performance of the Company. We exclude
restructuring-related expenses, costs related to early extinguishment of debt
and other certain items as such items are not representative of the results of
operations of our business for the three and six months ended June 30, 2012.
                                                         
Reconciliation of Avis Budget Group, Inc. Adjusted EBITDA, excluding certain
items to net income:
                                                         
                                    Three Months Ended    Six Months Ended
                                     June 30, 2012         June 30, 2012
Adjusted EBITDA, excluding certain   $266                $385
items
                                                         
Less: Non-vehicle related
depreciation and amortization                             
(excluding
acquisition-related amortization     26                   53
expense)
Interest expense related to corporate debt, net (excluding 
early
extinguishment of debt)              69                   142
Income before income taxes,          171                  190
excluding certain items
                                                         
Less certain items:                                       
Early extinguishment of debt         23                   50
Restructuring expense                12                   19
Transaction-related costs            4                    10
Acquisition-related amortization     3                    9
expense
Income before income taxes           129                  102
Provision for income taxes           50                   46
Net income                           $79                 $56
                                                         
Reconciliation of net income, excluding certain items to net income:
                                                         
Net income, excluding certain items  $112                $126
Less certain items, net of tax:                           
Early extinguishment of debt         21                   44
Restructuring expense                8                    13
Transaction-related costs            2                    7
Acquisition-related amortization     2                    6
expense
Net income                           $79                 $56
                                                         
Earnings per share, excluding        $0.94               $1.04
certain items (diluted)
                                                         
Earnings per share (diluted)         $0.66               $0.47
                                                         
Shares used to calculate earnings
per share, excluding certain items   121.9                124.8
(diluted)
                                                         
Free Cash Flow                                            
Represents Net Cash Provided by Operating Activities adjusted to reflect the
cash inflows and outflows relating to capital expenditures and GPS
navigational units, the investing and financing activities of our vehicle
programs, asset sales, if any, and to exclude debt extinguishment costs and
transaction-related costs. We believe that Free Cash Flow is useful to
management and investors in measuring the cash generated that is available to
be used to repurchase stock, repay debt obligations, pay dividends and invest
in future growth through new business development activities or acquisitions.
Free Cash Flow should not be construed as a substitute in measuring operating
results or liquidity, and our presentation of Free Cash Flow may not be
comparable to similarly-titled measures used by other companies. A
reconciliation of Free Cash Flow to the appropriate measure recognized under
GAAP is provided on Table 4.

CONTACT: Media Contact:
         John Barrows
         (973) 496-7865
         PR@avisbudget.com
        
         Investor Contact:
         Neal Goldner
         (973) 496-5086
         IR@avisbudget.com

Avis Budget Group, Inc. Logo