Asbury Automotive Group (ABG) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01Disruptions in the production and delivery of new vehicles and parts from manufacturers due to the lack of availability of parts and key components from suppliers could have a material adverse effect on our business, results of operations, financial condition and cash flows
2. 02Property loss or other uninsured liabilities could have a material adverse impact on our results of operations
3. 03If we are unable to acquire and successfully integrate additional businesses into our existing operations, and realize expected benefits and synergies from such acquisitions, our revenue and earnings growth may be adversely affected
4. 04support or other actions by third parties such as vendors, suppliers, and licensing agencies, and the untimely or inadequate responses from such third parties can delay or otherwise negatively impact integration processes
5. 05We are a holding company and as a result are dependent on our operating subsidiaries to generate sufficient cash and distribute cash to us to service our indebtedness and fund our ongoing operations
6. 06Our inability to execute a substantial portion of our business strategy, including our mission to grow and transform our business, could have an adverse effect on our business, results of operations, financial condition and cash flows
7. 07We cannot give assurance that we will be able to execute a substantial portion of our strategic plan which could have a material adverse effect on our business, financial condition, results of operations, and cash flows
8. 08The loss of key personnel and limited management and personnel resources could adversely affect our business
9. 09The Herb Chambers Dealerships acquisition may not occur at all or may not occur in the expected time frame, which may negatively affect the trading price of our common stock and our future business and financial results
10. 10We may not realize the strategic benefits and cost synergies that are anticipated from the planned Herb Chambers Dealerships acquisition

Risks Related to Macroeconomic and Market Conditions

1. 11The automotive retail industry is sensitive to unfavorable changes in general economic conditions and various other factors that could affect demand for our products and services, which could have a material adverse effect on our business, our ability to implement our strategy and our results of operations
2. 12We also are subject to economic, competitive, and other conditions prevailing in the various markets in which we operate, even if those conditions are not prominent nationally
3. 13Adverse conditions affecting one or more of the vehicle manufacturers with which we hold franchises or their inability to deliver a desirable mix of vehicles that our consumers demand could have a material adverse effect on our business, results of operations, financial condition and cash flows
4. 14Hyundai Motor North America (Hyundai and Genesis)
5. 15Substantial competition in automobile sales and services may have a material adverse effect on our results of operations
6. 16If vehicle manufacturers reduce or discontinue sales incentive, warranty or other promotional programs, our business, financial condition, results of operations and cash flows may be materially adversely affected
7. 17Technological advances, including electrification of vehicles and adoption of autonomous vehicles in the long-term, could have a material adverse effect on our business

Risks Related to Our Indebtedness and Financial Matters

1. 18Our outstanding indebtedness, ability to incur additional debt and the provisions in the agreements governing our debt, and certain other agreements, could have a material adverse effect on our business, financial condition, results of operations, and cash flows
2. 19Our business, financial condition and results of operations may be materially adversely affected by increases in interest rates
3. 20Our vehicle sales, financial condition and results of operations may be materially adversely affected by changes in costs or availability of consumer financing
4. 21technology general controls ("ITGCs") at a third-party software vendor who supports the Dealer Management System ("DMS") utilized by the Koons dealership group that we acquired in December 2023

Risks Related to Legal and Regulatory Matters

1. 22New laws, regulations, or governmental policies in response to climate change, including fuel economy and greenhouse gas emission standards, or changes to existing standards, could adversely impact our business, results of operations, financial condition, cash flow, and prospects
2. 23currently devote significant resources to comply with applicable federal, state, and local regulation of health, safety, environmental, zoning and land use regulations, and we may need to spend additional time, effort, and money to keep our operations and existing or acquired facilities in compliance therewith
3. 24We are subject to risks related to the provision of employee health care benefits, which could have a material adverse effect on our business, results of operations, financial condition and cash flows
4. 25We are, and expect to continue to be, subject to legal and administrative proceedings, which, if the outcomes are adverse to us, could have a material adverse effect on our business, results of operations, financial condition, cash flows, reputation and prospects
5. 26A decline in our credit rating or a general disruption in the credit markets could negatively impact our liquidity and ability to conduct our operations
6. 27We are subject to risks associated with imported product restrictions or limitations, foreign trade and currency valuations