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Driven Brands Holdings Inc. (DRVN)·Q1 2025 Earnings Summary

Executive Summary

  • DRVN delivered solid Q1: revenue $516.2M (+7% y/y) and adjusted diluted EPS $0.27, with Take 5 comps +8% and total company comps +0.7% .
  • Results vs S&P Global consensus: revenue beat ($516.2M vs $494.6M*), adjusted EPS beat ($0.27 vs $0.239*); S&P’s “EBITDA” consensus was $122.5M* while S&P’s “actual” reflects GAAP EBITDA (~$94.2M), not company adjusted ($125.1M) — definitional differences matter here .
  • Reaffirmed FY25 guidance (revenue ~$2.05–$2.15B, adj. EBITDA ~$520–$550M, adj. EPS ~$1.15–$1.25; SSS +1–3%; net store growth ~175–200) .
  • Portfolio simplification and deleveraging on track: closed sale of U.S. car wash (Apr 10; ~$255M cash + $130M seller note), with proceeds used to reduce debt; net leverage 4.3x at Q1; goal ≤3x by end 2026 .
  • Near-term stock reaction catalysts: durability of Take 5 comps, Maaco softness trajectory within Franchise Brands, visibility on H2-weighted year, and tariff cost pass-through discipline .

What Went Well and What Went Wrong

  • What Went Well

    • Take 5 Oil Change momentum: revenue +15%, comps +8%, adjusted EBITDA $100.9M with margin ~34% and 22 net new units; management cited premium oil mix (~90%) and non-oil services >20% of segment sales as drivers .
    • International Car Wash strength: comps +26.2%, adjusted EBITDA $24.4M with margin 36% (+280bps y/y) on better operations and weather .
    • Deleveraging progress and portfolio simplification: closed U.S. car wash sale Apr 10; majority of proceeds used for debt reduction; >$43M paydown in Q1, and as of the call “nearly $290M” year-to-date since Jan 1, 2025 .

  • What Went Wrong

    • Franchise Brands softness, mainly at Maaco: segment same-store sales -2.9% and revenue -6% y/y; adjusted EBITDA fell to $44.4M; management expects near-term softness to persist into Q2 .
    • Margin pressure: company adjusted EBITDA margin ~24.2% (down ~120 bps y/y) on higher store expenses and SG&A (investments in growth initiatives; lapping a refranchising gain) .
    • Take 5 margin modestly lower y/y (repair/maintenance and rent pressure), with management guiding prudently for comp moderation off a larger base .

Financial Results

Trend (oldest → newest)

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$591.7 $564.1 $516.2
Adjusted EBITDA ($USD Millions)$138.8 $130.7 $125.1
Adjusted Diluted EPS ($)$0.26 $0.30 $0.27
GAAP Diluted EPS ($)$(0.09) $(1.94) $0.04
Total Same-Store Sales (%)1.1% 2.9% 0.7%

Q1 2025 vs S&P Global Consensus

MetricActualS&P Global Consensus
Revenue ($USD Millions)$516.2 $494.6*
Primary EPS / Adjusted Diluted EPS ($)$0.27 $0.239*
EBITDA ($USD Millions)$94.2 (GAAP EBITDA) $122.5*
Adjusted EBITDA ($USD Millions)$125.1 N/A

Note: S&P Global’s “EBITDA Consensus Mean” refers to S&P’s EBITDA construct; S&P’s “actual” field reflects GAAP EBITDA, while the company emphasizes Adjusted EBITDA; use care when comparing. Values marked with * are from S&P Global. Values retrieved from S&P Global.

Segment Breakdown – Q1 2025

SegmentSystem-wide Sales ($USD Millions)Store CountSame-Store Sales (%)Revenue ($USD Millions)Adjusted EBITDA ($USD Millions)
Take 5$387.5 1,203 8.0% $293.4 $100.9
Franchise Brands$1,033.4 2,660 (2.9)% $71.7 $44.4
Car Wash (International)$66.6 718 26.2% $68.0 $24.4
Corporate & Other$59.3 216 N/A$83.0 $(44.6)
Total$1,546.8 4,797 0.7% $516.2 $125.1

KPIs

KPIQ1 2024Q1 2025
Total System-wide Sales ($USD Millions)$1,512.9 $1,546.8
Total Store Count4,620 4,797
Total Same-Store Sales (%)1.0% 0.7%
Take 5 Same-Store Sales (%)N/A (not presented)8.0%
Franchise Brands Same-Store Sales (%)N/A (not presented)(2.9)%
Car Wash Same-Store Sales (%)N/A (not presented)26.2%

Guidance Changes

MetricPeriodPrevious Guidance (2/25/25)Current Guidance (5/6/25)Change
RevenueFY 2025~$2.05–$2.15B ~$2.05–$2.15B Maintained
Adjusted EBITDAFY 2025~$520–$550M ~$520–$550M Maintained
Adjusted Diluted EPSFY 2025~$1.15–$1.25 ~$1.15–$1.25 Maintained
Same-Store SalesFY 2025+1% to +3% +1% to +3% Maintained
Net Store GrowthFY 2025~175–200 ~175–200 Maintained
Phasing CommentaryFY 2025N/AH2 to contribute low-50% of FY revenue & adj. EBITDA Added color

Note: FY25 guidance excludes the now-closed U.S. car wash divestiture .

Earnings Call Themes & Trends

TopicQ3 2024 (Q-2)Q4 2024 (Q-1)Q1 2025 (Current)Trend
DeleveragingAchieved 4.5x net leverage target ahead of schedule Issued FY25 outlook; deleveraging a focus Net leverage 4.3x; >$43M Q1 paydown; >$15M annualized interest saved post further Q2 paydown Improving
Portfolio simplification–Announced sale of U.S. car wash Closed sale Apr 10; proceeds to debt reduction Executed
Take 5 growth engine+5% comps; strong pipeline Full-year Maintenance revenue +16%, comps +7% +8% comps; revenue +15%; non-oil services >20% of sales Strong, moderating prudently
Franchise Brands (Maaco)Stable brands highlighted Segment stable cash flow frame Softness concentrated in Maaco; comps -2.9%; near-term softness expected Near-term pressure
Tariffs/macro––Pricing power and diversified sourcing (USMCA coverage) to mitigate; monitoring impact Managed risk
Glass business––Multi-year build; insurance/commercial wins ramping in 2025 Early ramp
H2 weighting––Expect revenue/adj. EBITDA weighting to H2 low-50% New phasing detail

Management Commentary

  • Strategic focus: “Having accomplished the sale of our U.S. car wash business, our focus for 2025 is on our key priorities of delivering our 2025 outlook and utilizing excess free cash flow to reduce debt.” — Jonathan Fitzpatrick, CEO .
  • Take 5 drivers: “Non-oil change services…now above 20% of Take 5’s total system-wide sales…premium oils…~90% of our oil changes.” — Mike Diamond, CFO .
  • Tariffs and pricing power: “Our diversified sourcing strategy and pricing power…help us mitigate foreseeable risks…our offerings remain essential.” — Danny Rivera, incoming CEO .
  • Guidance tone: “We are reiterating our fiscal 2025 outlook…appropriately cautious for the upcoming quarter…second half of 2025 should contribute a percentage in the low 50%...” — CFO .

Q&A Highlights

  • Take 5 margins: Margins saw modest pressure from repair/maintenance and rent; team expects continued strong execution even if comps moderate as the base grows .
  • Franchise Brands levers: Segment margins primarily track sales; softness mainly Maaco (more discretionary); medium-term trajectory intact .
  • Oil cost tailwind: Base oil price declines flow through with ~one-quarter lag; helps Take 5 margin outlook .
  • Car Wash International: One of its best quarters (comps +26%, margin ~36%); some weather benefit; expect normalization in H2 .
  • Glass ramp: Multi-year build; benefits from newly landed insurance/commercial accounts starting to materialize in 2025 .

Estimates Context

  • Q1 2025 revenue beat: $516.2M vs $494.6M consensus*; 10 revenue estimates contributed to consensus .
  • Q1 2025 adjusted EPS beat: $0.27 vs $0.239 consensus*; 11 EPS estimates .
  • EBITDA nuance: S&P “EBITDA Consensus Mean” was $122.5M*, while S&P’s “actual” field reflects GAAP EBITDA ($94.2M); company-reported Adjusted EBITDA was $125.1M. On an adjusted basis, performance is slightly above the consensus construct, but investors should align definitions before concluding beat/miss .
  • Outlook for estimate revisions: Management reiterated FY25 revenue/adj. EBITDA/adj. EPS and highlighted H2 weighting; near-term softness in Maaco and prudent Take 5 comp moderation could shift intra-quarter estimates toward H2 phasing .

Values marked with * are from S&P Global. Values retrieved from S&P Global.

Key Takeaways for Investors

  • Take 5 remains the core growth engine (comps +8%; revenue +15%), with mix tailwinds from premium oil and non-oil services; watch for prudent comp moderation off a larger base .
  • Franchise Brands softness is concentrated in Maaco; management expects continued near-term pressure but medium-term stabilization; monitor sequential comp trends through Q2 .
  • Deleveraging trajectory is intact and accelerating post U.S. car wash sale; net leverage 4.3x with further interest expense savings as term debt is reduced .
  • FY25 guide reaffirmed; H2 weighting implies Q2 prudence and potential set-ups for H2 execution-driven upside if macro cooperates .
  • Tariff risk appears manageable given sourcing diversity and pricing power; oil cost declines could be a margin tailwind with ~1-quarter lag .
  • For trading, focus on: (1) Take 5 monthly comp cadence and unit openings, (2) Maaco comp inflection timing, (3) debt paydown pace and interest savings, (4) confirmation of H2 phasing on Q2 update .