• Revenue was $1,342.4 million as compared to $969.8 million in the prior year, an increase of 38.4% and the highest first quarter revenue reported in the Company's history
• Net income for the period was $4.3 million versus $21.3 million in the prior year and includes a loss on extinguishment of embedded derivative of $(29.3) million and a loss on extinguishment of debt of $(9.9) million in Q1 2022
• Adjusted EBITDA¹ was $62.2 million versus $47.2 million in the prior year, an increase of 31.7%; normalized increase of 60.6% as compared to prior year normalized adjusted EBITDA¹ of $38.7 million
• Adjusted EBITDA margin¹ was 4.6% versus 4.9% in the prior year, a decrease of (0.3) percentage points; normalized increase of 0.6 percentage points as compared to prior year normalized adjusted EBITDA margin¹of 4.0%
• Diluted earnings per share was $0.10, a decrease of $(0.61) from $0.71 in the prior year
• Indebtedness of $358.5 million at the end of Q1 2022 compares to $285.9 million at the end of Q4 2021
• Net indebtedness¹ of $248.8 million at the end of Q1 2022 compares to $212.7 million at the end of Q4 2021

EDMONTON, AB, May 4, 2022 /CNW/ - AutoCanada Inc. ("AutoCanada" or the "Company") (TSX: ACQ), a multi-location North American automobile dealership group, today reported its financial results for the three month period ended March 31, 2022.

"We opened 2022 with yet another record first quarter, reflecting ongoing positive momentum and our business as a whole continues to perform better than ever," said Paul Antony, Executive Chairman of AutoCanada. "Our Q1 results speak to the determination, agility and strength of our team, and the trend of sustainable improvement across all areas of our business. Continued strong performance from used vehicles, F&I, and our U.S. operations were key drivers in the quarter.

"We continued to advance our acquisition strategy with the recent addition of the Audi Windsor and Porsche of London dealerships, further expanding our platform in Ontario while adding brand diversity and increasing the mix of luxury dealerships within our overall portfolio. 

"Looking forward to the remainder of 2022, with our newly expanded executive team in place, we will continue to build on our strong momentum and focus on our strategic growth pillars to deliver industry-leading performance and enhance shareholder returns. We remain well positioned to continue to execute on our acquisition strategy in the coming quarters with several dealerships currently being evaluated. We also expect to see continued realization of synergies from our acquisitions which will further drive our 2022 Adjusted EBITDA performance."

AutoCanada also announced today that Maryann Keller will be retiring from the Company's Board of Directors effective May 5, 2022.

Mr. Antony continued, "On behalf of the Board and the management team at AutoCanada, I would like to thank Maryann for her dedication and capable guidance during her board tenure. Maryann has been with us since May 2015, including four years as our Lead Independent Director. Maryann has seen the Company through numerous critical transformations, leaving us with a strong foundation to pursue our growth strategy. We wish her all the best."

First Quarter Key Highlights and Recent Developments

The Company set another first quarter record as revenue reached $1,342.4 million as compared to $969.8 million in the prior year, an increase of 38.4%. Record Q1 2022 results were driven by strong performance across all areas of our complete business model, in particular our used vehicle and finance and insurance ("F&I") business operations, and continued material improvements from our U.S. Operations.

Net income for the period was $4.3 million, as compared to $21.3 million in Q1 2021, including a loss on extinguishment of embedded derivative of $(29.3) million and a loss on extinguishment of debt of $(9.9) million in Q1 2022. Diluted earnings per share was $0.10, an decrease of $(0.61) from $0.71 in the prior year.

Adjusted EBITDA¹ for the period was $62.2 million as compared to $47.2 million reported in Q1 2021, an improvement of 31.7%. Prior year results include $8.5 million of government assistance related to COVID. Excluding these typically non-recurring income items in the prior year, adjusted EBITDA¹ of $62.2 million compares to normalized adjusted EBITDA¹ of $38.7 million in the prior year, a normalized improvement of 60.6%. Adjusted EBITDA margin¹ of 4.6% compares to normalized adjusted EBITDA margin¹ of 4.0% in the prior year, an increase of 0.6 percentage points ("ppts").

Gross profit increased by $79.7 million to $247.3 million, an increase of 47.5%, as compared to prior year. This increase was largely driven by the increases of $13.6 million from used vehicles and $26.8 million from F&I. In addition, used retail vehicles² sales increased by 4,338 units, up 44.6%, to 14,072, which contributed to the consolidated used to new retail units ratio² moving to 1.55 from 1.18. F&I gross profit per retail unit average² increased to $3,406, up 17.9% or $516 per unit. Gross profit percentage² of 18.4% was a result of strong performance across all areas of the business and compares to 17.3% in the prior year.

Our U.S. Operations continues to demonstrate strong growth and contributed $38.9 million of gross profit, an increase of $23.5 million or 152% as compared to prior year. This improvement in gross profit was driven by gains across all aspects of the business, resulting in a gross profit percentage of 18.4%.

Proactive inventory management for both new and used vehicles continued to be a key driver to the Company's success in delivering both strong revenue and retail margin growth across all our business operations in the first quarter. We continue to manage our new vehicle inventory as the chip shortage remains an issue, particularly impacting new vehicle inventory supply. While we are gradually seeing improvements in both available new vehicle inventory and allocations, we are not expecting a return to "normalcy" in inventory levels until late 2023 to 2024. Compensating for reduced new vehicle supply, we more than doubled our used vehicle inventory position to $717.3 million as at March 31, 2022 as compared to $311.4 million in Q1 2021. Management continues to monitor the used vehicle market and actively manage our used vehicle inventory position to ensure it is appropriate to meet current market demand.

Net indebtedness¹ increased by $36.0 million from December 31, 2021 to $248.8 million at the end of Q1 2022. This increase is primarily driven by the repurchase and cancellation of $(31.2) million of shares under the authorized Normal Course Issuer Bid ("NCIB"). Free cash flow¹ on a trailing twelve month ("TTM") basis was $93.6 million at Q1 2022 as compared to $144.6 million in Q1 2021; the decline in free cash flow¹ between years was driven primarily by reduced government assistance in 2021, increased cash taxes, stock based compensation related cash payments, and changes in working capital. Additionally, our net indebtedness leverage ratio¹ of 1.1x remained well below our target range at the end of Q1 2022, as compared to 0.7x in Q1 2021.

Had all of the completed acquisitions, as identified in Section 5 Acquisitions, Divestitures, Relocations and Real Estate, occurred at April 1, 2021, consolidated pro forma net income would have been $155.7 million for the TTM ended March 31, 2022, as compared to consolidated pro forma net income of $174.8 million for the year ended December 31, 2021. Pro forma normalized adjusted EBITDA¹ would be $282.4 million for the TTM ended March 31, 2022, as compared to pro forma normalized adjusted EBITDA¹ of $266.4 million for the year ended December 31, 2021. 

We remain well-positioned to continue to execute on our acquisition strategy in the coming quarters. We continue to develop a transaction pipeline with a number of dealerships currently being evaluated.

The Company welcomed Jeffery Thorpe, President, Canadian Operations, Brian Feldman, Senior Vice President, Canadian Operations and Disruptive Technologies, and Lee Wittick, Senior Vice President, Operations and OEM Relations to the executive team April 2022 to continue to drive the Company's ongoing growth, synergies, and efficiencies. All three executive team members have significant industry expertise operating a dealership platform at scale using centralized services through head office, which closely mirrors AutoCanada's operating rhythm. With our 2022 strategic growth pillars and the new executive team in place, we are poised to demonstrate our best in class operations, and continue to grow our scalable and repeatable business model.

Our performance, both in Canada and U.S. Operations, continues our trend of sustainable improvement and demonstrates the efficacy of our complete business model and strategic initiatives. We remain aware that uncertainty continues to exist in the macroeconomic environment given the ongoing challenges associated with the global pandemic and the Russia-Ukraine war. Uncertainties may include potential economic recessions or downturns, continued disruptions to the global automotive manufacturing supply chain, and other general economic conditions resulting in reduced demand for vehicle sales and service. We will continue to remain proactive and vigilant in assessing the impacts on our organization and remain committed to optimizing and building stability and resiliency into our business model to ensure we are able to drive industry-leading performance regardless of changing market condition.

Consolidated AutoCanada Highlights

ANOTHER RECORD SETTING FIRST QUARTER

AutoCanada delivered another record setting first quarter.

Refer to Section 5 Acquisitions, Divestitures, Relocations and Real Estate of the Company's MD&A for the three month period ended March 31, 2022 for acquisitions included in Q1 2022 results.

For the three-month period ended March 31, 2022:

• Revenue was $1,342.4 million, an increase of $372.6 million or 38.4%
• Total vehicles sold² were 23,414, an increase of 4,707 units or 25.2%
• Used retail vehicles² sold increased by 4,338 or 44.6%
• Net income for the period was $4.3 million (or $0.11 per basic share) versus $21.3 million (or $0.71 per diluted share)
• Loss on extinguishment of embedded derivative of $(29.3) million and loss on extinguishment of debt of $(9.9) million were recognized in Q1 2022
• Adjusted EBITDA¹ increased by 31.7% to $62.2 million, an increase of $15.0 million
• Adjusted EBITDA¹ increased by 60.6% over prior year normalized adjusted EBITDA¹ of $38.7 million, an increase of $23.5 million
• Adjusted EBITDA¹ on a trailing twelve month basis was $266.8 million
• Net indebtedness¹ of $248.8 million reflected an increase of $36.0 million from the end of Q4 2021

Canadian Operations Highlights

OUTPERFORMED NEW RETAIL MARKET BY 6.6 PPTS, USED RETAIL UNIT² SALES INCREASED BY 30%

We outperformed the Canadian market, as same store new retail unit² sales decreased by (6.8)% as compared to the market decrease of (13.4)%, for same store brands represented by AutoCanada as reported by DesRosiers Automotive Consultants ("DesRosiers"), an outperformance of 6.6 ppts.

Our used vehicle and F&I segments were key drivers of the record earnings in Q1 2022. Used vehicle gross profit percentage² increased to 7.0% as compared to 6.7% in the prior year. F&I gross profit per retail unit average² increased to $3,368, up 12.7% or $379 per unit.

Unless stated otherwise, all results for acquired businesses are included in all Canadian references in the MD&A.

For the three-month period ended March 31, 2022:

• Revenue was $1,131.0 million, an increase of 30.9%
• Used retail vehicles² sold increased by 2,620 or 29.6%
• Average TTM Canadian used retail unit² sales per dealership per month, excluding Used Digital Retail Division dealerships², improved to 54, as compared to 50 in the prior year
• Used to new retail units ratio² increased to 1.50 from 1.29
• TTM used to new retail ratio² improved to 1.48 at Q1 2022 as compared to 1.01 at Q1 2021
• F&I gross profit per retail unit average² increased to $3,368, up 12.7% or $379 per unit
• Net loss for the period was $(1.0) million, down (104.8)% from a net income of $21.0 million in 2021
• Loss on extinguishment of embedded derivative of $(29.3) million and loss on extinguishment of debt of $(9.9) million were recognized in Q1 2022
• Adjusted EBITDA¹ increased 23.6% to $53.4 million, an increase of $10.2 million
• Adjusted EBITDA¹ increased by 33.1% over prior year normalized adjusted EBITDA¹ of $40.1 million
• Adjusted EBITDA margin¹ was 4.7% as compared to normalized adjusted EBITDA margin¹ of 4.6% in the prior year, an increase of 0.1 ppts

U.S. Operations Highlights

REVENUE DOUBLED TO $211 MILLION

U.S. Operations continues to improve under the new management team, as demonstrated by the fourth consecutive quarter of year-over year growth in adjusted EBITDA¹. This growth was driven by improvements across all aspects of the business and resulted in a gross profit percentage of 18.4% and a 77.3% increase in total retail unit sales.

• Revenue was $211.4 million, an increase of 99%, from $106.0 million
• Used retail vehicles² sold increased by 1,718 units or 192%
• F&I gross profit per retail unit average² increased to $3,583 per unit, up 62.3% or $1,375 per unit
• Net income for the period increased by $5.0 million to $5.3 million, from $0.3 million
• Net income on a trailing twelve month basis was $22.1 million
• Adjusted EBITDA¹ was $8.8 million as compared to $4.0 million, an increase of $4.8 million
• Normalized adjusted EBITDA¹ for the prior year was $(1.4) million, resulting in a normalized increase of $10.2 million
• Adjusted EBITDA¹ on a trailing twelve month basis was $36.0 million

Same Store Metrics - Canadian Operations

F&I GROSS PROFIT PER RETAIL UNIT AVERAGE² INCREASED TO $3,702, UP 20% OR $617 PER UNIT

We outperformed the Canadian market by 6.6 ppts as same store new retail units² decreased by (6.8)% as compared to the market decrease of (13.4)%, for same store brands represented by AutoCanada as reported by DesRosiers. The continued optimization of the Company's complete business model is highlighted by the year-over-year 23.2% improvement in gross profit across each individual business segment which collectively totaled $179.6 million.

Refer to Section 19 Same Stores Results Data of the Company's MD&A for the three month period ended March 31, 2022 for the definition of same store and further information.

• Revenue increased to $926.7 million, an increase of 17.2%
• Gross profit increased by $33.8 million or 23.2%
• Used to new retail units ratio² increased to 1.46 from 1.19
• Used retail unit² sales increased by 14.0%, an increase of 1,144 units
• For the fourteenth consecutive quarter of year-over-year growth, F&I gross profit per retail unit average² increased to $3,702, up 20.0% or $617 per unit; gross profit increased to $58.1 million as compared to $46.3 million in the prior year, an increase of 25.4%
• Parts, service and collision repair ("PS&CR") gross profit increased to $59.2 million, an increase of 17.3%
• PS&CR gross profit percentage² decreased to 52.2% as compared to 54.6% in the prior year

Financing and Investing Activities and Other Recent Developments

ISSUED $350 MILLION SENIOR UNSECURED NOTES

Net indebtedness¹ of $248.8 million resulted in a net indebtedness leverage ratio¹ of 1.1x. Financing and investing activities included the following:

• On January 12, 2022, S&P Global Ratings ("S&P") issued a research update and raised both the issuer credit rating and the Company's senior unsecured notes to 'B+'.
• On February 7, 2022, amended and extended our existing credit facility for total aggregate bank facilities of $1.3 billion, with a maturity date of April 14, 2025.
• On February 7, 2022, issued $350 million of Senior Unsecured Notes at 5.75%, due February 7, 2029, with the proceeds used to fund the redemption of the outstanding $250 million 8.75% Senior Unsecured Notes due February 11, 2025, to reduce the outstanding balance under its syndicated credit facility and for general corporate purposes including acquisitions.
• On May 2, 2022, the Company acquired substantially all of the assets used in or relating to the Audi Windsor and Porsche of London dealerships, located in London and Windsor, Ontario, respectively. The acquisition supports management's strategic objectives of further establishing the Company's presence in the province of Ontario, increasing both brand diversity and luxury mix within our portfolio. The acquisition included the underlying real estate for both dealerships.
• On May 4, 2022, the Company entered into an arrangement with the Bank of Nova Scotia to provide non-recourse mortgage financing for a previously purchased property in Maple Ridge, BC. The non-recourse mortgage arrangement will fund land value as well as construction costs associated with the development of two dealerships. The non-recourse mortgage is secured by the real estate as collateral. The credit facility allows for up to $100 million of non-recourse mortgage financing. The non-recourse mortgage liability is not considered a liability for purposes of calculating our credit facility financial covenants.

First Quarter Financial Information

The following table summarizes the Company's performance for the quarter:

SELECTED QUARTERLY FINANCIAL INFORMATION

The following table shows the unaudited results of the Company for each of the eight most recently completed quarters. The results of operations for these periods are not necessarily indicative of the results of operations to be expected in any given comparable period.

MD&A and Financial Statements

Information included in this press release is a summary of results. It should be read in conjunction with AutoCanada's Consolidated Financial Statements and Management's Discussion and Analysis for the quarter ended March 31, 2022, which can be found on the Company's website at www.autocan.ca or on www.sedar.com.

NON-GAAP MEASURES

This press release contains certain financial measures that do not have any standardized meaning prescribed by Canadian GAAP. Therefore, these financial measures may not be comparable to similar measures presented by other issuers. Investors are cautioned these measures should not be construed as an alternative to net earnings (loss) or to cash provided by (used in) operating, investing, financing activities, cash and cash equivalents, and indebtedness determined in accordance with Canadian GAAP, as indicators of our performance. We provide these additional non-GAAP measures, capital management measures, and supplementary financial measures to assist investors in determining our ability to generate earnings and cash provided by (used in) operating activities and to provide additional information on how these cash resources are used.

Adjusted EBITDA, adjusted EBITDA margin, normalized adjusted EBITDA, normalized adjusted EBITDA margin, income statement impacts and adjusted EBITDA on a pre-IFRS 16 basis, adjusted EBITDA margin on a pre-IFRS 16 basis, pro forma adjusted EBITDA, pro forma normalized adjusted EBITDA, free cash flow, net indebtedness, and net indebtedness leverage ratio are not earnings measures recognized by GAAP and do not have standardized meanings prescribed by GAAP. Investors are cautioned that these non-GAAP measures should not replace net earnings or loss (as determined in accordance with GAAP) as an indicator of the Company's performance, of its cash flows from operating, investing and financing activities or as a measure of its liquidity and cash flows. The Company's methods of calculating referenced non-GAAP measures may differ from the methods used by other issuers. Therefore, these measures may not be comparable to similar measures presented by other issuers. 

It should be noted that certain of the financial measures described below include pro forma items estimating the impact of the acquisitions if they had occurred on the first day of the relevant period, or as of a specified date. Readers should understand that these estimates were determined by management in good faith and are not indicative of what the historical results of the businesses acquired in the acquisitions actually were for the relevant period, or what those results would have been if the acquisitions had occurred on the dates indicated, or what they will be for any future period. As a result, the pro forma financial measures may not be indicative of the Company's financial position that would have prevailed, or operating results that would have been obtained, if the transactions had taken place on the dates indicated or of the financial position or operating results which may be obtained in the future. These pro forma financial measures are not a forecast or projection of future results. The actual financial position and results of operations of the Company for any period following the closing of the acquisitions will vary from the amounts set forth following pro forma financial measures, and such variation may be material.

We list and define these "NON-GAAP MEASURES" below:

Adjusted EBITDA

Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) is an indicator of a company's operating performance over a period of time and ability to incur and service debt. Adjusted EBITDA provides an indication of the results generated by our principal business activities prior to:

• Interest expense (other than interest expense on floorplan financing), income taxes, depreciation, and amortization;
• Charges that introduce volatility unrelated to operating performance by virtue of the impact of external factors (such as share-based compensation amounts attributed to certain equity issuances as a part of the Used Digital Retail Division);
• Non-cash charges (such as impairment, recoveries, gains or losses on free-standing derivatives, revaluation of contingent consideration and revaluation of redemption liabilities);
• Charges outside the normal course of business (such as restructuring, gains and losses on dealership divestitures and real estate transactions); and
• Charges that are non-recurring in nature (such as provisions for wholesale fraud and settlement income).

The Company believes adjusted EBITDA provides improved continuity with respect to the comparison of our operating performance over a period of time.

Normalized Adjusted EBITDA

With the onset of COVID-19 during the second quarter of 2020, the impact of COVID-19 related government restrictions resulted in charges that are one-time in nature, and related government programs resulted in subsidies that are non-recurring in the future.

Normalized adjusted EBITDA is an indicator of a company's operating performance over a period of time and ability to incur and service debt, normalized for charges that are non-recurring in nature related to the pandemic such as:

• Canada Emergency Wage Subsidy ("CEWS") income expected to recur until the Company is no longer eligible for the subsidy;
• Canada Emergency Rent Subsidy ("CERS") income expected to recur until the Company is no longer eligible for the subsidy; and
• One-time forgiveness of Small Business Association Paycheck Protection Program ("PPP") loans.

The Company believes normalized adjusted EBITDA provides improved continuity with respect to the comparison of our operating performance normalized for impacts related to the COVID-19 pandemic.

Pro Forma Adjusted EBITDA and Pro Forma Normalized Adjusted EBITDA

The Company believes pro forma adjusted EBITDA and pro forma normalized adjusted EBITDA provides improved understanding of the progress of our acquisition strategy as if the acquisitions had occurred at the beginning of the period. Pro forma adjusted EBITDA and pro forma normalized adjusted EBITDA includes management's estimate of the net income generated by our acquisitions prior to interest expense (other than interest expense on floorplan financing), income taxes, depreciation, and amortization, assuming acquisitions in the year had occurred on the first day of the 12 month period ended December 31, prior to any synergies, pursuant to the terms of the credit facilities. Pro forma adjustments estimated by management were derived from dealership financial statements. The Company's blended rate of Canadian corporate tax of 25.4% was applied to pro forma adjustments where applicable.

Refer to the MD&A for the year ended December 31, 2021 for the reconciliation of the pro forma normalized adjusted EBITDA for the year ended December 31, 2021.

Adjusted EBITDA Margin, Normalized Adjusted EBITDA Margin, and Adjusted EBITDA Margin on a Pre-IFRS 16 Basis

Adjusted EBITDA margin is an indicator of a company's operating performance specifically in relation to our revenue performance. Normalized adjusted EBITDA margin is an indicator of a company's operating performance specifically in relation to our revenue performance, normalized for government programs subsidies that are non-recurring in nature related to the pandemic such as:

• CEWS income expected to recur until the Company is no longer eligible for the subsidy;
• CERS expected to recur until the Company is no longer eligible for the subsidy; and
• One-time forgiveness of Small Business Association PPP loans.

The Company believes adjusted EBITDA margin, normalized adjusted EBITDA margin and adjusted EBITDA margin on a pre-IFRS 16 basis provides improved continuity with respect to the comparison of our operating performance with retaining and growing profitability as our revenue and scale increases over a period of time.

Income Statement Impacts and Adjusted EBITDA on a Pre-IFRS 16 basis

The Company adopted IFRS 16 on January 1, 2019. On adoption of IFRS 16, the Company recognized lease liabilities in relation to leases, which had previously been classified as 'operating leases' under the principles of IAS 17 Leases. These liabilities were measured at the present value of the remaining lease payments, discounted using the lessee's incremental borrowing rate. There are also corresponding income statement impacts to net income and other comprehensive income.

The Company believes adjusted EBITDA on a pre-IFRS 16 basis provides improved continuity for purposes of comparing to our historical operating performance prior to fiscal year 2019. Our Credit Facility financial covenants are calculated and presented on a pre-IFRS 16 basis. In addition, the net indebtedness leverage ratio is calculated on a pre-IFRS 16 basis.

Adjusted EBITDA on a pre-IFRS 16 basis is calculated as adjusted EBITDA less the rental expense, fair market value rent adjustment, and step lease rent adjustment eliminated from the adoption of IFRS 16 lease liabilities accounting standards.

Free Cash Flow

Free cash flow is a measure used by Management to evaluate the Company's performance. While the closest Canadian GAAP measure is cash provided by operating activities, free cash flow is considered relevant because it provides an indication of how much cash generated by operations is available after capital expenditures. It shall be noted that although we consider this measure to be free cash flow, financial and non-financial covenants in our credit facilities and dealer agreements may restrict cash from being available for distributions, re-investment in the Company, potential acquisitions, or other purposes. Investors should be cautioned that free cash flow may not actually be available for such purposes. References to "Free cash flow" are to cash provided by (used in) operating activities (including the net change in non-cash working capital balances) less capital expenditure (not including acquisitions of dealerships and dealership facilities).

Net Indebtedness Leverage Ratio

Net indebtedness leverage ratio is a measure used by management to evaluate the liquidity of the Company.

The Company believes presenting the net indebtedness leverage ratio on a pre-IFRS 16 basis provides improved continuity for purposes of comparing to our historical operating performance prior to fiscal year 2019 and remains relevant while our Credit Facility financial covenants continues to be calculated and presented on a pre-IFRS 16 basis. Net indebtedness leverage ratio is calculated as net indebtedness compared to Adjusted EBITDA pre-IFRS 16 on a TTM basis.

We list and define "CAPITAL MANAGEMENT MEASURES" below:

Net Indebtedness

Net indebtedness is used by management to evaluate the liquidity of the Company.

Net indebtedness is calculated as indebtedness, net of unamortized deferred financing costs, adding back embedded derivative asset, and less cash and cash equivalents.

NON-GAAP AND OTHER FINANCIAL MEASURES RECONCILIATIONS

Adjusted EBITDA and Normalized Adjusted EBITDA

The following table illustrates adjusted EBITDA and normalized adjusted EBITDA, for the three-month period ended March 31, over the last two years of operations:

Segmented Adjusted EBITDA and Segmented Normalized Adjusted EBITDA

The following table illustrates the segmented adjusted EBITDA and normalized adjusted EBITDA, for the three-month period ended March 31, over the last two years of operations:

Pro Forma Adjusted EBITDA and Pro Forma Normalized Adjusted EBITDA Reconciliation

The following table illustrates pro forma adjusted EBITDA and pro forma normalized adjusted EBITDA for the trailing twelve month period ended March 31, over the last two years of operations:

Quarter-to-Date Adjusted EBITDA Margin

The following table illustrates adjusted EBITDA margin for the three-month periods ended March 31, over the last two years of operations:

Quarter-to-Date Normalized Adjusted EBITDA Margin

The following table illustrates normalized adjusted EBITDA margin for the three-month periods ended March 31, over the last two years of operations:

Quarter-to-Date Adjusted EBITDA Margin on a Pre-IFRS 16 basis

The following table illustrates adjusted EBITDA margin on a pre-IFRS 16 basis for the three-month periods ended March 31, over the last two years of operations:

Quarter-to-Date Adjusted EBITDA on a Pre-IFRS 16 Basis Reconciliation

The following table illustrates segmented adjusted EBITDA on a pre-IFRS 16 basis, for the three-month periods ended March 31, over the last two years of operations:

Free Cash Flow

The following table illustrates free cash flow for the last eight consecutive quarters.

Net Indebtedness and Net Indebtedness Leverage Ratio Reconciliation

The following table illustrates the Company's net indebtedness and net indebtedness leverage ratio as at March 31, 2022 and December 31, 2021:

Conference Call

A conference call to discuss the results for the three months ended March 31, 2022 will be held on May 5, 2022 at 9:00am Mountain (11:00am Eastern). To participate in the conference call, please dial 1.888.664.6392 approximately 10 minutes prior to the call.

This conference call will also be webcast live over the internet and can be accessed by all interested parties at the following URL: https://investors.autocan.ca/event/2022-q1-conference-call/

About AutoCanada

AutoCanada is a leading North American multi-location automobile dealership group currently operating 80 franchised dealerships, comprised of 28 brands, in eight provinces in Canada as well as a group in Illinois, USA. AutoCanada currently sells Chrysler, Dodge, Jeep, Ram, FIAT, Alfa Romeo, Chevrolet, GMC, Buick, Cadillac, Ford, Infiniti, Nissan, Hyundai, Subaru, Audi, Volkswagen, Kia, Mazda, Mercedes-Benz, BMW, MINI, Volvo, Toyota, Lincoln, Acura, Honda and Porsche branded vehicles. Additionally, the Company's Canadian Operations segment currently operates 2 used vehicle dealerships supporting the Used Digital Retail Division, the RightRide division operates 7 locations, and 4 stand-alone collision centres (within our group of 18 collision centres). In 2021, our dealerships sold approximately 86,000 vehicles and processed over 800,000 service and collision repair orders in our 1,303 service bays generating revenue in excess of $4 billion.

Additional information about AutoCanada Inc. is available at www.sedar.com and the Company's website at www.autocan.ca.

Forward Looking Statements

Certain statements contained in this press release are forward-looking statements and information (collectively "forward-looking statements", including "with respect to", "among other things", "future performance", "expense reductions" and the "Go Forward Plan"), within the meaning of the applicable Canadian securities legislation. We hereby provide cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in these forward-looking statements. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as "will likely result", "are expected to", "will continue", "is anticipated", "projection", "vision", "goals", "objective", "target", "schedules", "outlook", "anticipate", "expect", "estimate", "could", "should", "plan", "seek", "may", "intend", "likely", "will", "believe", "shall" and similar expressions) are not historical facts and are forward-looking and may involve estimates and assumptions and are subject to risks, uncertainties and other factors some of which are beyond our control and difficult to predict.

Accordingly, these factors could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. Therefore, any such forward-looking statements are qualified in their entirety by reference to the factors discussed throughout this press release.

The Company's Annual Information Form and other documents filed with securities regulatory authorities (accessible through the SEDAR website at www.sedar.com) describe the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference.

Further, any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by applicable law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

Additional Information

Additional information about AutoCanada is available at the Company's website at www.autocan.ca and www.sedar.com.

SOURCE AutoCanada Inc.