What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2026-02-13 compared with 2025-02-14 · 351 added, 336 removed, 1296 unchanged (35% of the section changed)

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In making this assessment, management used the 2013 framework set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control — Integrated Framework .

As permitted by guidelines established by the SEC for newly acquired businesses, we excluded three of our recently acquired businesses in 2024, (the “Excluded Acquisitions”), from the scope of our annual report on internal controls over financial reporting for the year ended December 31, 2024.

The Excluded Acquisitions comprise approximately $768.6 million of our consolidated total assets as of December 31, 2024, and $1.0 billion of our consolidated revenues for the year then ended.

We are in the process of integrating these businesses into our overall internal controls over financial reporting and plan to include it in our scope for the year ended December 31, 2025.

As permitted by guidelines established by the SEC for newly acquired businesses, we excluded one of our recently acquired businesses in 2025, (the “Excluded Acquisition”), from the scope of our annual report on internal controls over financial reporting for the year ended December 31, 2025.

The Excluded Acquisition comprised approximately $157.4 million of our consolidated total assets as of December 31, 2025, and $94.4 million of our consolidated total revenues for the year then ended.

We are in the process of integrating this business into our overall internal controls over financial reporting and plan to include it in our scope for the year ended December 31, 2026.

Based on our evaluation under the framework in Internal Control — Integrated Framework , our management concluded that, as of December 31, 2025, our internal control over financial reporting was effective.

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We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2025, of the Company and our report dated February 13, 2026, expressed an unqualified opinion on those financial statements.

As described in Management’s Annual Report on Internal Control over Financial Reporting, management excluded from its assessment the internal control over financial reporting at three acquired businesses (the “Excluded Acquisitions”).

The Excluded Acquisitions constitute $768.6 million of consolidated total assets as of December 31, 2024, and $1.0 billion of consolidated revenues for the year then ended.

Accor dingly, our audit did not include the internal control over financial reporting at the Excluded Acquisitions.

As described in Management’s Annual Report on Internal Control over Financial Reporting, management excluded from its assessment the internal control over financial reporting at one acquired business (the “Excluded Acquisition”).

The Excluded Acquisition constitutes $157.4 million of consolidated total assets as of December 31, 2025, and $94.4 million of consolidated revenues for the year then ended.

Accor dingly, our audit did not include the internal control over financial reporting at the Excluded Acquisition.

Basis for Opinion

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Trading Plans

During the three months ended December 31, 2024, the following officer, as defined in Rule 16a-1(f), adopted a “Rule 10b5-1 trading arrangement,” as defined in Item 408(a) of Regulation S-K.

On November 26, 2024 , Daryl A.

Kenningham , our Chief Executive Officer , adopted a 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 24,401 shares of the Company’s common stock until August 1, 2025 .

No other officers or directors, as defined in Rule 16a-1(f), adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K, during the three months ended December 31, 2024.

During the three months ended December 31, 2025, no director or officer, as defined in Rule 16a-1(f), adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

21 unchanged sentences

001-13461) filed November 15, 2021)

— Third Amended and Restated Certificate of Incorporation of Group 1 Automotive, Inc.

effective May 18, 2023 (incorporated by reference to Exhibit 3.1 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended June 30, 2023)

— Fourth Amended and Restated Certificate of Incorporation of Group 1 Automotive, Inc.

effective May 13, 2025 (incorporated by reference to Exhibit 3.1 of Group 1 Automotive, Inc.’s Current Report on Form 8-K (File No.

001-13461) filed May 14, 2025)

— Certificate of Designation of Series A Junior Participating Preferred Stock (incorporated by reference to Exhibit 3.2 of Group 1’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended March 31, 2007)

— Fourth Amended and Restated Bylaws of Group 1 Automotive, Inc.

effective February 15, 2023 (incorporated by reference to Exhibit 3.1 of Group 1 Automotive, Inc.’s Current Report on Form 8-K (File No.

001-13461) filed July 28, 2023)

— Fifth Amended and Restated Bylaws of Group 1 Automotive, Inc.

effective May 13, 2025 (incorporated by reference to Exhibit 3.1 of Group 1 Automotive, Inc.’s Current Report on Form 8-K (File No.

001-13461) filed May 16, 2025)

— Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 of Group 1 Automotive, Inc.’s Registration Statement on Form S-1 (Registration No.

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001-13461) for the year ended December 31, 2020)

— Twelfth Amended and Restated Revolving Credit Agreement dated as of March 9, 2022, among Group 1 Automotive, Inc., the Subsidiary Borrowers listed therein, the Lenders listed therein and U.S.

Bank National Association, as Administrative Agent (incorporated by reference to Exhibit 10.1 of Group 1 Automotive, Inc.’s Current Report on Form 8-K (File No.

001-13461) filed on March 10, 2022).

— First Amendment to the Twelfth Amended and Restated Revolving Credit Agreement dated effective as of August 18, 2022 (incorporated by reference to Exhibit 10.1 of Group 1 Automotive Inc.’s Current Report on Form 8-K (File No.

001-13461) filed August 23, 2022).

— Second Amendment to the Twelfth Amended and Restated Revolving Credit Agreement dated effective December 8, 2023 (incorporated by reference to Exhibit 10.3 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended March 31, 2024)

— Third Amendment to the Twelfth Amended and Restated Revolving Credit Agreement dated effective April 30, 2024 (incorporated by reference to Exhibit 10.1 of Group 1 Automotive, Inc.’s Current Report on Form 8-K (File No.

001-13461) filed May 2, 2024)

— Fourth Amendment to the Twelfth Amended and Restated Revolving Credit Agreement effective July 25, 2024 (incorporated by reference to Exhibit 10.1 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended September 30, 2024)

— Thirteenth Amended and Restated Revolving Credit Agreement, effective May 30, 2025 (incorporated by reference to Exhibit 10.1 of Group 1 Automotive Inc.’s Current Report on Form 8-K (File No.

001-13461) filed June 3, 2025) (incorporated by reference to Exhibit 10.1 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended June 30, 2025)

— Additional Borrower Addendum to Master Loan Agreement dated effective March 25, 2024 (incorporated by reference to Exhibit 10.1 of Group 1 Automotive Inc.’s Current Report on Form 8-K (File No.

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001-13461) filed December 11, 2023)

— Second Addendum to Master Loan Agreement dated effective May 19, 2025 (File No.

001-13461) filed June 3, 2025) (incorporated by reference to Exhibit 10.2 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended June 30, 2025)

— Group 1 Automotive, Inc.

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001-13461) for the year ended December 31, 2023)

— Form of Restricted Stock Agreement (2025 Form)

— Form of Performance Share Unit Agreement (2025 Form)

— Form of Restricted Stock Agreement (2025 Form) (incorporated by reference to Exhibit 10.28 of Group 1 Automotive, Inc.’s Annual Report on Form 10-K (File No.

001-13461) for the year ended December 31, 2024)

— Form of Performance Share Unit Agreement (2025 Form) (incorporated by reference to Exhibit 10.29 of Group 1 Automotive, Inc.’s Annual Report on Form 10-K (File No.

001-13461) for the year ended December 31, 2024)

— Form of Restricted Stock Unit Agreement (Cash Settlement) for Non-Employee Directors

— Master Credit Agreement, dated February 12, 2024, by and among Group 1 Realty, Inc., AMR Real Estate Holdings, LLC, Group 1 Realty NE, LLC, G1R Clear Lake, LLC and LHM ATO, LLC, as Borrowers, and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 10.1 of Group 1 Automotive, Inc.’s Current Report on Form 8-K (File No.

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001-13461) for the quarter ended June 30, 2024)

— Separation Agreement, dated effective February 24, 2025, by and between Group 1 Automotive, Inc.

and Edward McKissic (incorporated by reference to Exhibit 10.2 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended March 31, 2025)

— First Amendment to Separation Agreement, dated effective February 28, 2025, by and between Group 1 Automotive, Inc.

and Edward McKissic (incorporated by reference to Exhibit 10.3 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended March 31, 2025)

— Separation Agreement, dated August 27, 2025, by and between Michael Jones and Group 1 Automotive, Inc.

(incorporated by reference to Exhibit 10.1 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended September 30, 2025)

— First Amendment to Separation Agreement, dated October 22, 2025, by and between Michael Jones and Group 1 Automotive Inc.

(incorporated by reference to Exhibit 10.2 of Group 1 Automotive, Inc.’s Quarterly Report on Form 10-Q (File No.

001-13461) for the quarter ended September 30, 2025)

— Group 1 Automotive, Inc.

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+ Exhibits marked with a (+) exclude certain immaterial schedules and exhibits pursuant to the provisions of Regulation S-K, Item 601(a)(5).

A copy of any of the omitted schedules and exhibits will be furnished to the Securities and Exchange Commission upon request.

A copy of any of the omitted schedules and exhibits will be furnished to the SEC upon request.

Form 10-K Summary

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The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Intangible Franchise Rights in Acquisitions and Impairment Assessments — Refer to Notes 1, 3 and 13 to the consolidated financial statements

Intangible Franchise Rights — Refer to Notes 1 and 12 to the financial statements

Critical Audit Matter Description

During the year ended December 31, 2024, the Company acquired 67 dealerships.

The acquisitions were accounted for as business combinations.

Accordingly, the purchase price was allocated to the assets acquired and liabilities assumed based on their respective fair values, including indefinite-lived intangible assets, related to rights under franchise agreements with manufacturers.

The fair value of acquired intangible franchise rights is estimated using the income approach.

The Company’s annual impairment assessment for intangible franchise rights is performed in the fourth quarter, or more frequently if events or circumstances indicate possible impairment.

In evaluating intangible franchise rights for impairment, a qualitative assessment is initially performed to determine whether it is more-likely-than-not that an impairment exists.

The Company’s evaluation of intangible franchise rights for impairment is performed annually, or more frequently if events or circumstances indicate possible impairment.

The Company first completes a qualitative assessment to determine whether it is more-likely-than-not that an impairment exists.

If it is concluded that it is more-likely-than-not that an impairment exists, a quantitative assessment is performed.

The fair value is estimated using a discounted cash flow model, or income approach.

The Company’s impairment assessments performed in fiscal year 2024 resulted in an impairment of $28.2 million of intangible franchise rights.

We identified the fair value of acquired intangible franchise rights for the acquisitions, the qualitative impairment assessments for certain franchise rights, as well as the fair value estimates used in the quantitative impairment assessments of intangible franchise rights as a critical audit matter because of the significant estimates and assumptions management makes related to forecasts of revenue growth rates, future EBITDA margins, weighted average cost of capital, and terminal growth rates.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists for the quantitative impairment assessments and acquired intangible franchise rights, when performing audit procedures to evaluate the reasonableness of management’s assumptions.

We identified the fair value estimates used in the quantitative impairment assessment of intangible franchise rights as a critical audit matter because of the significant judgments made by management to estimate the fair value including revenue growth rates, future earnings before interest, taxes, depreciation, and amortization (“EBITDA”) margins, and the weighted average cost of capital (“WACC”).

This required a high degree of auditor judgment and extensive effort to evaluate the reasonableness of management judgments, including the involvement of internal fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures for the acquisitions and the impairment assessments related to the forecasts of revenue growth rates, future EBITDA margins, weighted average cost of capital and terminal growth rates included the following, among others:

• We tested the effectiveness of internal controls over the acquired intangible franchise rights and the intangible franchise rights impairment assessments, including those over the inputs, assumptions, and calculations used in determining fair value of the intangible franchise rights.

• We evaluated the reasonableness of management’s forecasts of revenue growth rates and future EBITDA margins by comparing the forecasts to:

◦ The Company’s historical revenue and EBITDA margins.

◦ Internal communications to management and the Board of Directors.

◦ Current industry, market and economic trends.

• We performed a sensitivity analysis of certain assumptions such as revenue growth rates, future EBITDA margins, weighted average cost of capital, and terminal growth rates to evaluate the potential change in the fair value resulting from changes in underlying assumptions.

• With the assistance of our fair value specialists, for acquired intangible franchise rights and those intangible franchise rights where a quantitative impairment assessment was performed, we evaluated the reasonableness of the weighted average cost of capital and terminal growth rates by:

◦ Developing a range of independent estimates and comparing those to the weighted average cost of capital selected by management.

◦ Testing the source information underlying the determination of the terminal growth rates and testing the mathematical accuracy of the calculations.

Goodwill Impairment Assessment — Refer to Notes 1 and 13 to the consolidated financial statements

Our audit procedures for the impairment assessment related to the revenue growth rates, future EBITDA margins, and the WACC included the following, among others:

• We tested the effectiveness of internal controls over the intangible franchise rights impairment assessment, including those over the determination of the fair value of the intangible franchise rights, such as controls related to management's forecasts of revenue growth rates, future EBITDA margins, and the WACC.

• We evaluated the reasonableness of management’s revenue growth rates and future EBITDA margins by comparing to (1) internal communications to management, (2) information included in Company press releases and (3) analyst and industry reports for the Company and companies in its peer group.

• We performed a sensitivity analysis to evaluate the change in fair value resulting from changes in revenue growth rates, EBITDA margins, and WACC assumptions .

• With the assistance of our fair value specialists, we evaluated the reasonableness of the WACC by developing a range of independent estimates and comparing those to the WACC selected by management.

Goodwill — U.K.

Reporting Unit — Refer to Notes 1 and 12 to the financial statements

Critical Audit Matter Description

The Company’s annual impairment assessment for goodwill is performed in the fourth quarter, or more frequently if events or circumstances indicate possible impairment.

The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying value.

The fair value is estimated using the income approach and market approach, weighted equally.

The goodwill balance for the U.K.

reporting unit was $275.7 million as of December 31, 2024.

The fair value of the U.K.

reporting unit exceeded the carrying value as of the assessment date and, therefore, no impairment was recognized.

We identified the fair value estimates used in the U.K.

reporting unit goodwill impairment assessment as a critical audit matter because of the significant estimates and assumptions management makes related to forecasts of revenue growth rates, future EBITDA margins, weighted average cost of capital, valuation multiples, and terminal growth rate.

This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of management’s assumptions.

reporting unit, the Company uses a combination of the income and market approaches to estimate reporting unit fair value, which requires management to make significant estimates and assumptions related to revenue growth rates, future EBITDA, the WACC, and market multiples.

Changes in these assumptions could have a significant impact on the amount of any impairment charge.

We identified the U.K.

reporting unit goodwill impairment assessments as a critical audit matter because of the significant judgments made by management to estimate the fair value including revenue growth rates, future EBITDA margins, the WACC, and market multiples.

This required a high degree of auditor judgment and extensive effort to evaluate the reasonableness of those management judgments, including the involvement of internal fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures for the impairment assessment related to the forecasts of revenue growth rates, future EBITDA margins, weighted average cost of capital, valuation multiples, and terminal growth rate included the following, among others:

• We tested the effectiveness of internal controls over the goodwill impairment assessment, including those over the inputs, assumptions, and calculations used in determining fair value of the reporting unit.

• We evaluated the reasonableness of management’s forecasts of revenue growth rates and future EBITDA margins by comparing the forecasts to:

◦ The Company’s historical revenue and EBITDA margins.

◦ Internal communications to management and the Board of Directors.

◦ Current industry, market and economic trends.

• We performed a sensitivity analysis of certain assumptions such as revenue growth rates, future EBITDA margins, weighted average cost of capital, valuation multiples, and terminal growth rate to evaluate the potential change in the fair value resulting from changes in underlying assumptions.

• With the assistance of our fair value specialists, we evaluated the reasonableness of the weighted average cost of capital, valuation multiples, and terminal growth rate by:

◦ Developing a range of independent estimates and comparing those to the weighted average cost of capital and valuation multiples selected by management.

◦ Testing the source information underlying the determination of the terminal growth rate and testing the mathematical accuracy of the calculations.

Our audit procedures related to revenue growth rates, future EBITDA margins, the WACC, and market multiples used by management to estimate the fair value of the U.K.

reporting unit included the following, among others:

• We tested the effectiveness of controls over the goodwill impairment assessment, including those over the determination of the fair value for the U.K.

reporting unit, such as controls related to management's forecasts of future revenues and EBITDA margins, the WACC, and market multiples.

• We performed sensitivity analyses to evaluate the change in fair value resulting from changes in revenue growth rates, future EBITDA, the WACC, and market multiples assumptions.

• We evaluated management’s ability to accurately forecast future revenues by comparing actual results to management’s historical forecasts.

• We evaluated the reasonableness of management’s forecasted revenues by comparing to (1) internal communications to management, (2) information included in Company press releases and (3) analyst and industry reports for the Company and companies in its peer group.

• With the assistance of our fair value specialists, we evaluated the reasonableness of the WACC and market multiples by:

◦ Testing the source information underlying the determination of the WACC and the mathematical accuracy of the calculation.

◦ Testing the source information underlying the determination of the market multiples and the mathematical accuracy of the calculation and comparing the multiples selected by management to its guideline companies.

◦ Developing a range of independent estimates and comparing those to the WACC and market multiples selected by management.

/s/ Deloitte & Touche LLP

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Restructuring charges

Other operating (income) expense

Other operating income

INCOME FROM OPERATIONS 734.0 909.1 968.6

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Other interest expense, net 182.9 141.3 99.8

Other expense 0.7 4.5 1.2

Other (income) expense

( 0.2 ) 0.7 4.5

INCOME BEFORE INCOME TAXES 449.9 658.5 800.2

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Other comprehensive income (loss), net of taxes:

Net foreign currency translation adjustments:

Unrealized foreign currency translation adjustments ( 19.1 ) 23.7 ( 27.2 )

Reclassification of cumulative foreign currency translation adjustments associated with the Brazil Disposal — — 122.8

Reclassification of other cumulative foreign currency translation adjustments — — 1.5

Foreign currency translation adjustments, net of reclassifications ( 19.1 ) 23.7 97.1

Foreign currency translation adjustments

54.8 ( 19.1 ) 23.7

Net unrealized gain (loss) on interest rate risk management activities, net of tax:

Unrealized gain arising during the period, net of tax provision of $( 6.7 ), $( 3.3 ) and $( 25.8 ), respectively

Unrealized (loss) gain arising during the period, net of tax benefit (provision) of $ 1.5 , $( 6.7 ) and $( 3.3 ), respectively

( 4.7 ) 21.5 10.4

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— ( 0.2 ) ( 3.1 )

Unrealized (loss) gain on interest rate risk management activities, net of tax ( 7.4 ) ( 18.0 ) 81.6

OTHER COMPREHENSIVE (LOSS) INCOME, NET OF TAX

Unrealized loss on interest rate risk management activities, net of tax

( 24.9 ) ( 7.4 ) ( 18.0 )

OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX

30.0 ( 26.5 ) 5.7

COMPREHENSIVE INCOME $ 355.2 $ 471.7 $ 607.3

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Other comprehensive income, net of taxes — — — — 5.7 — 5.7

Purchases of treasury stock — — — — — ( 521.2 ) ( 521.2 )

Purchases of treasury stock, including excise tax

— — — — — ( 174.2 ) ( 174.2 )

Net issuance of treasury shares to stock compensation plans ( 101,160 ) — ( 9.7 ) — — 18.9 9.2

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Net income — — — 498.1 — — 498.1

Other comprehensive income, net of taxes — — — — 5.7 — 5.7

Other comprehensive loss, net of taxes — — — — ( 26.5 ) — ( 26.5 )

Purchases of treasury stock, including excise tax

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Net income — — — 325.2 — — 325.2

Other comprehensive loss, net of taxes — — — — ( 26.5 ) — ( 26.5 )

Other comprehensive income, net of taxes — — — — 30.0 — 30.0

Purchases of treasury stock, including excise tax — — — — — ( 559.7 ) ( 559.7 )

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Unrealized loss (gain) on derivative instruments 1.3 0.3 ( 3.7 )

0.3 ( 3.7 ) —

Other ( 0.4 ) ( 0.1 ) ( 2.7 )

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Purchases of property and equipment ( 270.0 ) ( 245.1 ) ( 185.4 )

Proceeds from sale of discontinued operations, net — — 59.4

Other — 9.6 ( 8.3 )

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Dividends paid ( 25.6 ) ( 25.2 ) ( 25.2 )

Other — — ( 1.2 )

Net cash provided by (used in) financing activities 681.1 185.2 ( 67.3 )

Net cash (used in) provided by financing activities ( 31.1 ) 681.1 185.2

Effect of exchange rate changes on cash 6.0 ( 7.6 ) 0.1

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and its subsidiaries are collectively referred to as the “Company” in these Notes to Consolidated Financial Statements.

On July 1, 2022, the Company completed the disposal of 100 % of the issued and outstanding equity interests of the Company’s Brazilian operations (the “Brazil Disposal Group”).

The Brazil Disposal Group met the criteria to be reported as discontinued operations.

Therefore, the related assets, liabilities and operating results of the Brazil Disposal Group are reported as discontinued operations (the “Brazil Discontinued Operations”) for all periods presented.

Discontinued operations presented in the accompanying Consolidated Financial Statements relate to the Company’s Brazilian operations which were disposed of in 2022.

Unless otherwise specified, disclosures in these Consolidated Financial Statements reflect continuing operations only.

Refer to Note 4.

Discontinued Operations and Other Divestitures for additional information on the Brazil Discontinued Operations.

During the year ended December 31, 2024, the Company recognized $ 10.0 million of business interruption insurance recoveries as a result of the June 2024 cybersecurity incident experienced by CDK, which resulted in service outages on CDK’s dealers’ systems.

The insurance recoveries were recognized within Other operating (income) expense in the Consolidated Statements of Operations.

Certain amounts in the Consolidated Financial Statements and the accompanying notes may not compute due to rounding.

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Management analyzes the Company’s estimates based on historical experience and other assumptions that are believed to be reasonable under the circumstances, however, actual results could differ materially from such estimates.

The significant estimates made by management in the accompanying Consolidated Financial Statements include, but are not limited to, inventory valuation adjustments, reserves for future chargebacks on finance, insurance and vehicle service contract fees, self-insured property and casualty insurance exposure, the fair value of assets acquired and liabilities assumed in business combinations, the valuation of goodwill and intangible franchise rights, and reserves for potential litigation.

The significant estimates made by management in the accompanying Consolidated Financial Statements include, but are not limited to, inventory valuation adjustments, reserves for future chargebacks on finance, insurance and VSC fees, self-insured property and casualty insurance exposure, the fair value of assets acquired and liabilities assumed in business combinations, the valuation of goodwill and intangible franchise rights, and reserves for potential litigation.

Revenue Recognition

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In determining the lower of specific cost or net realizable value of new and used vehicles, the Company considers historical loss experience and current market trends.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Parts and accessories inventories are valued at the lower of cost or net realizable value and determined on a first-in, first-out basis.

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The rebates, interest assistance and other dealer incentives reduce inventory costs in the Consolidated Balance Sheets and are reflected as a reduction to Cost of Sales in the Consolidated Statements of Operations as the vehicles are sold.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Refer to Note 9.

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Property and equipment estimated useful lives are as follows:

Buildings and leasehold improvements 25 to 50

Buildings and leasehold improvements (1)

Machinery and dealership equipment 7 to 20

Office equipment, furniture and fixtures 3 to 20

Company vehicles 3 to 5

Company vehicles 3

(1) Leasehold improvements are depreciated over the lesser of their estimated useful lives or the minimum lease term at lease inception.

Subsequent to lease inception, depreciation is based on the lesser of the estimated useful life or the Company’s expected period of occupancy.

Refer to Note 11.

Leases for further discussion of the Company’s leases.

Expenditures for major additions or improvements, which improve or extend the useful lives of the assets are capitalized.

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Refer to Note 3.

Acquisitions for further discussion of the Company’s business combinations.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Acquisitions and Dispositions for further discussion of the Company’s business combinations.

Goodwill and Intangible Franchise Rights

Goodwill represents the excess, at the date of acquisition, of the purchase price of an acquired business over the fair value of the net tangible and intangible assets acquired.

The Company is organized into two geographic regions, the U.S.

region and the U.K.

The Company has determined that each region represents a reporting unit for the purpose of assessing goodwill for impairment.

The Company is organized into two geographic segments, the U.S.

segment and the U.K.

The Company has determined that each segment represents a reporting unit for the purpose of assessing goodwill for impairment.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

In addition to goodwill, the Company recognizes, at the dealership level, separately identifiable intangible assets for rights under franchise agreements with manufacturers.

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The Company receives advertising assistance from certain automobile manufacturers, which the Company is required to spend on qualified advertising, and which is subject to audit and chargeback by the manufacturer.

The assistance is accounted for as a reduction to SG&A expenses as earned and amounted t o $ 24.8 million , $ 22.3 million and $ 17.4 million for the years ended December 31, 2024, 2023 and 2022, respectively.

The assistance is accounted for as a reduction to SG&A expenses as earned and amounted to $ 25.6 million, $ 24.8 million and $ 22.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Statements of Cash Flows

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All borrowings from, and repayments to, the Company’s credit facilities (including the cash flows from or to manufacturer affiliated lenders participating in the Revolving Credit Facility) are presented within Cash Flows from Financing Activities.

Refer to the discussion of the Company’s leases and related accounting policies in Note 11.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Refer to the discussion of the Company’s leases and related accounting policies in Note 12.

Foreign Currency Translation

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Recent Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The amendments require the disclosure of a reconciliation between income tax expense from continuing operations and the amount computed by multiplying income from continuing operations before income taxes by the applicable statutory rate as well as an annual disaggregation of the income tax rate reconciliation between certain specified categories by both percentage and reported amounts, along with other changes to income tax disclosure requirements.

The standard will be effective for fiscal years beginning after December 15, 2024.

Early adoption is permitted and can be applied retrospectively.

The Company is currently evaluating the impact that the adoption of the provisions of the ASU will have on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures.

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The Company is currently evaluating the impact that the adoption of the provisions of the ASU will have on its consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments — Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets .

The amendments introduce a practical expedient that allows entities to measure expected credit losses on current accounts receivable and current contract assets by assuming that current conditions as of the reporting date will remain unchanged over the life of those assets.

This update is intended to simplify the estimation process by reducing reliance on forecasts of future economic conditions.

The standard will be effective for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years, with early adoption permitted.

The Company is currently evaluating the impact the adoption of the ASU will have on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software .

The amendments eliminate the previous stage of development framework and require capitalization of internal-use software costs to begin when management authorizes and commits funding for a project, and it is probable the project will be completed and placed in service.

The standard will be effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted.

The Company is planning to early adopt the ASU prospectively for the fiscal year beginning January 1, 2026, including interim periods.

The Company does not expect the adoption will have a material impact on its consolidated financial statements.

In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815):

Hedge Accounting Improvements .

The ASU is intended to simplify and clarify hedge accounting under ASC 815 and improves the alignment of hedge results with risk-management activities.

The standard will be effective for fiscal years beginning after December 15, 2026, and interim periods within those annual reporting periods.

The Company is currently evaluating the impact that the adoption of the provisions of the ASU will have on its consolidated financial statements.

The Company derives its revenues primarily from the sale of new and used vehicles;

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Total revenues $ 16,626.8 $ 5,944.6 $ 22,571.4

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2024

8 unchanged sentences

Total revenues $ 15,772.9 $ 4,161.5 $ 19,934.3

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2023

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In certain jurisdictions, the Company has an enforceable right to payment for performance completed to date on open work orders and as such, the transfer of control of vehicle maintenance and repair services and satisfaction of the performance obligation to its customer occurs over time.

For these contracts that qualify for revenue recognition over time, the Company uses the input method for the measurement of progress and recognition of revenues, utilizing labor cost incurred to estimate the services performed for which the Company has an enforceable right to payment.

For these contracts that qualify for revenue recognition over time, the Company uses the input method for the measurement of progress and recognition of revenues, utilizing labor costs incurred to estimate the services performed for which the Company has an enforceable right to payment.

The Company believes this method is the most objective measure of progress and provides a faithful depiction of the Company’s transfer of services to the customer.

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With regards to the upfront commission for these contracts, the transaction price is the amount earned for each individual contract executed and is generally collected within 30 days of the satisfaction of the performance.

The Company may be charged back in the future for commissions received on F&I contract or vehicle service contract fees in the event of early termination of the contracts by customers.

The Company may be charged back in the future for commissions received on F&I contract or VSC fees in the event of early termination of the contracts by customers.

A reserve for future amounts estimated to be charged back, representing variable consideration, is recorded as a reduction to Finance, insurance and other, net in the Consolidated Statements of Operations.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

ACQUISITIONS AND DISPOSITIONS

The Company accounts for business combinations under the acquisition method of accounting, under which the Company allocates the purchase price to the assets acquired and liabilities assumed based on an estimate of fair value.

Inchcape Acquisition

On August 1, 2024 (the “Acquisition Date”), the Company completed the acquisition of Inchcape Retail automotive operations (“Inchcape Retail”), consisting of 54 dealership locations, certain real estate and three collision centers acro ss the U.K.

On August 1, 2024, the Company completed the acquisition of Inchcape Retail automotive operations (“Inchcape Retail”), consisting of 54 dealership locations, certain real estate and three collision centers acro ss the U.K.

(collectively referred to as the “Inchcape Acquisition”), for aggregate consideration of approximately $ 517.0 million .

The accounting for the Inchcape Acquisition is considered to be preliminary.

The Company is continuing to analyze and assess relevant information related to the valuation of certain property, equipment, intangible assets, property lease contracts and deferred tax assets.

Due to the recent timing and complexity of the Inchcape Acquisition, these amounts are provisional and subject to change as the Company’s fair value assessments are finalized.

The Company will reflect any such adjustments in subsequent filings.

The Company has completed its analysis and assessment of all relevant fair value information and finalized the purchase price allocation of the Inchcape Acquisition.

The results of the Inchcape Acquisition are included in the U.K.

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Goodwill $ 128.4

The Company recorded $ 15.4 million of acquisition related costs attributable to the Inchcape Acquisition during the year ended December 31, 2024.

The Company recorded $ 0.2 million and $ 15.4 million of acquisition related costs attributable to the Inchcape Acquisition during the years ended December 31, 2025 and 2024 , respectively .

These costs are included in Selling, general and administrative expenses in the Consolidated Statements of Operations.

The Company’s Consolidated Statements of Operations included revenues and net loss attributable to Inchcape Retail from the Acquisition Date through the year ended December 31, 2024, of $ 990.4 million and $ 3.1 million , res pectively.

The Company’s Consolidated Statements of Operations included revenues and net loss attributable to Inchcape Retail for the year ended December 31, 2025, of $ 2.4 billion and $ 18.7 million, respectively, and for the year ended December 31, 2024, of $ 990.4 million and $ 3.1 million , res pectively.

The net loss attributable to Inchcape Retail for the years ended December 31, 2025 and 2024 includes the impact of the restructuring charges further described in Note 4.

Restructuring.

The following unaudited pro forma financial information presents consolidated information of the Company as if the Inchcape Acquisition had occurred on January 1, 2023 (in millions):

Year Ended December 31,

Years Ended December 31,

Revenues $ 21,498.7 $ 20,503.1

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Other Acquisitions

During the year ended December 31, 2024, the Co mpany acquired nine dealerships in the U.S., including three Honda, two Lexus, one Toyota, one Kia, one Hyundai and one Mercedes-Benz dealerships.

The Company also acquired one Toyota Certified pre-owned center and three collision centers in the U.S.

During the year ended December 31, 2025, the Co mpany acquired four dealerships in the U.S., specifically one Lexus dealership, one Acura dealership and two Mercedes-Benz dealerships.

Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $ 531.7 million.

Goodwill associated with the acquisitions totaled $ 251.9 million.

During the year ended December 31, 2024, the Company acquired five additional dealerships in the U.K., including four Mercedes-Benz and one BMW/MINI dealerships.

Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $ 110.1 million, net of cash acquired, consisting of cash paid of $ 111.1 million and a receivable of $ 1.1 million.

During the year ended December 31, 2025, the Company acquired four dealerships in the U.K., specifically three Toyota dealerships and one Lexus dealership.

Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $ 16.4 million.

Goodwill associated with the acquisitions totaled $ 2.4 million.

The accounting for these acquisitions is considered to be preliminary and subject to change as the Company’s fair value assessments are finalized.

The Company is continuing to analyze and assess relevant information related to the valuation of property, equipment and intangible assets.

The purchase price allocation for these acquisitions is preliminary and subject to change as the Company’s fair value assessments are finalized.

The Company is continuing to analyze and assess relevant information related to the valuation of certain assets and liabilities, including, but not limited to, the valuation of property, equipment and intangible assets and deferred income taxes.

The Company will reflect any required fair value adjustments in subsequent periods.

During the year ended December 31, 2023, the Company acquired six dealerships in the U.S.

Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $ 365.8 million, net of cash acquired .

During the year ended December 31, 2024, the Company acquired nine dealerships in the U.S.

specifically three Honda dealerships, two Lexus dealerships, one Toyota dealership, one Kia dealership, one Hyundai dealership and one Mercedes-Benz dealership.

The Company also acquired one Toyota Certified pre-owned center and three collision centers in the U.S.

Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $ 690.4 million .

Goodwill associated with these acquisitions totaled $ 288.3 million .

During the year ended December 31, 2022, the Company acquired six dealerships and a collision center in the U.S.

During the year ended December 31, 2024, the Company acquired five dealerships in the U.K.

specifically four Mercedes-Benz dealerships and one BMW/MINI dealership.

Aggregate c onsideration paid for these dealerships, which were accounted for as business combinations, was $ 110.1 million , net of cash acquired.

Goodwill associated with the acquisitions totaled $ 46.3 million .

During the year ended December 31, 2023, the Company acquired six dealerships in the U.S.

Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $ 365.8 million, net of cash acquired .

Goodwill associated with these acquisitions totaled $ 49.7 million.

During the year ended December 31, 2022, the Company acquired a dealership and related collision center in the U.K.

C onsideration paid, which was accounted for as a business combination, was $ 34.1 million , net of cash acquired.

Goodwill associated with the acquisition totaled $ 10.2 million .

DISCONTINUED OPERATIONS AND OTHER DIVESTITURES

Brazil Discontinued Operations

On November 12, 2021, the Company entered into an agreement to effect the Brazil Disposal.

The sale price of approximately Brazilian Real (“BRL”) 510.0 million included a holdback amount as of July 1, 2022 (the “Brazil Disposition Date”), for general representations and warranties, of BRL 115.0 million, to be held in escrow for a period of five years from the close of the transaction (the “Brazil Disposal Escrow”).

At the conclusion of the five-year period, the remaining funds held in the Brazil Disposal Escrow will be released to the Company.

This amount has been included in the proceeds received.

As of December 31, 2024 , the Company had a remaining receivable balance of $ 16.8 million associated with the Brazil Disposal Escrow recorded in Other long-term assets on the Consolidated Balance Sheets, of which $ 2.4 million is expected to be paid to settle the Company’s portion of accrued liabilities retained subsequent to the Brazil Disposition Date.

Results of the Brazil Discontinued Operations were immaterial for the years ended December 31, 2024 and 2023.

The assets and liabilities of the Brazil Discontinued Operations were immaterial as of December 31, 2024 and 2023 and primarily consist of the Brazil Disposal Escrow described above.

The Company’s divestitures generally consist of dealership assets and related real estate.

Gains and losses on divestitures are recorded in Selling, general and administrative expenses in the Consolidated Statements of Operations.

During the year ended December 31, 2025, the Company recorded a net pre-tax gain totaling $ 8.1 million related to the disposition of four dealerships and one collision center in the U.S.

The dispositions reduced goodwill by $ 30.6 million.

The Company also terminated four franchises in the U.S.

During the year ended December 31, 2025, the Company closed nine dealerships in the U.K.

in connection with the Restructuring Plan (as defined in Note 4.

Restructuring).

Refer to Note 4.

Restructuring for further information regarding the impairment charges taken on these closed dealerships as part of the Restructuring Plan.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Results of the Brazil Discontinued Operations for the year ended December 31, 2022 were as follows (in millions):

Year Ended December 31,

New vehicle retail sales $ 109.0

Used vehicle retail sales 44.0

Used vehicle wholesale sales 10.1

Parts and service sales 23.8

Finance, insurance and other, net 3.3

Total revenues 190.2

COST OF SALES:

New vehicle retail sales 98.5

Used vehicle retail sales 41.2

Used vehicle wholesale sales 10.0

Parts and service sales 14.5

Total cost of sales 164.2

GROSS PROFIT 26.1

Selling, general and administrative expenses 15.1

Depreciation and amortization expense 0.9

Asset impairments 6.3

INCOME FROM DISCONTINUED OPERATIONS

Floorplan interest expense 1.4

Other interest income, net

Other expenses 1.5

INCOME BEFORE INCOME TAXES — DISCONTINUED OPERATIONS

Provision for income taxes 5.3

NET LOSS — DISCONTINUED OPERATIONS $ ( 2.7 )

Cash flows from operating and investing activities for the Brazil Discontinued Operations were immaterial for the years ended December 31, 2024 and 2023.

Cash flows from operating and investing activities for the Brazil Discontinued Operations for the year ended December 31, 2022 were as follows (in millions):

Year Ended December 31,

Net cash provided by operating activities — discontinued operations $ 26.6

Net cash provided by investing activities — discontinued operations

Other Divestitures

The Company’s dispositions generally consist of dealership assets and related real estate.

Gains and losses on dispositions are recorded in Selling, general and administrative expenses in the Consolidated Statements of Operations.

During the year ended December 31, 2025, the Company terminated eight franchises in the U.K.

and recorded an impairment charge of $ 2.7 million associated with certain franchise terminations.

During the year ended December 31, 2024, the Company recorded a net pre-tax gain totaling $ 52.9 million related to the disposition of eight dealerships and one collision center in the U.S.

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The company also terminated two franchises in the U.S.

During the year ended December 31, 2022, the Company recorded a net pre-tax gain totaling $ 30.8 million related to the disposition of five dealerships and one collision center in the U.S.

The dispositions reduced goodwill by $ 37.3 million.

The Company also terminated one franchise in the U.K.

Assets held for sale in the Consolidated Balance Sheets includes $ 11.5 million and $ 39.8 million of goodwill that has been reclassified to assets held for sale as of December 31, 2024 and 2023, respectively.

Assets held for sale in the Consolidated Balance Sheets include $ 39.5 million and $ 11.5 million of goodwill that has been reclassified to assets held for sale as of December 31, 2025 and December 31, 2024, respectively.

During the year ended December 31, 2024, the Company recognized $ 4.8 million in intangible asset impairment associated with assets held for sale.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the year ended December 31, 2025, the Company recognized a gain of $ 2.3 million associated with these previously impaired assets held for sale.

RESTRUCTURING

During the three months ended December 31, 2024, the Company i nitiated a U.K.

wide restructuring plan (the “Restructuring Plan”) relating to the integration activities of Inchcape Retail with existing U.K.

The Restructuring Plan consisted of workforce realignment, strategic closing of certain facilities and systems integrations.

The Restructuring Plan is expected to continue through 2025 and the Company expects to incur $ 7.7 million in additional restructuring costs.

Any changes to the Company’s estimates or timing will be reflected in the Company’s results of operations in future periods.

The following table summarizes restructuring charges (in millions):

Year Ended December 31,

During the fourth quarter of 2025, the Company initiated a second U.K.-wide restructuring plan (the “2025 Restructuring Plan”) to continue to reduce costs in the U.K.

The 2025 Restructuring Plan consists of further workforce realignment and strategic closing of certain facilities.

The 2025 Restructuring Plan is expected to continue through 2026, and the Company expects to incur $ 2.8 million of additional restructuring charges associated with this plan.

Any changes to the Company’s estimates or timing of such charges will be reflected in the Company’s results of operations in future periods.

During the fourth quarter of 2024, the Company initiated the first U.K.-wide restructuring plan (the “2024 Restructuring Plan”) related to the integration of Inchcape Retail with its existing U.K.

The 2024 Restructuring Plan, which included workforce realignment, the strategic closure of certain facilities and systems integrations, was completed as of September 30, 2025.

All planned actions under the 2024 Restructuring Plan have been finalized, and the associated restructuring charges have been fully recognized in the Company’s consolidated financial statements for the period ended December 31, 2025.

The components of total restructuring charges were as follows (in millions):

Years Ended December 31,

2025 Restructuring Plan

2024 Restructuring Plan

Contract termination costs

$ — $ 4.1 $ 10.1

Facility closure costs 2.8 3.3 —

Employee related costs

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Total restructuring charges

$ 8.1 $ 20.3 $ 16.7

Charges associated with the Restructuring Plan are included within Restructuring Charges on the Consolidated Statements of Operations.

The following table presents the changes in restructuring related liabilities (in millions):

2025 Restructuring Plan

2024 Restructuring Plan

December 31, 2024 $ — $ 11.9

Charges incurred (1)

Cash payments

( 5.4 ) ( 22.8 )

December 31, 2025 $ 0.4 $ 5.2

(1) Charges incurred exclude non-cash asset impairments of $ 2.4 million and $ 4.3 million for the 2025 Restructuring Plan and 2024 Restructuring Plan, respectively.

Liabilities associated with restructuring charges are included in Accrued expenses and other current liabilities on the Consolidated Balance Sheets.

As of December 31, 2024, the Company had $ 11.9 million of accrued restructuring charges related to the Restructuring Plan.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

STOCK-BASED COMPENSATION PLANS

On May 15, 2024, the Company’s shareholders approved the amendment and restatement of the Company’s Long Term Incentive Plan (the “2024 Incentive Plan”).

Under the Company’s 2024 Long Term Incentive Plan (the “Incentive Plan”), the Company currently grants RSAs, RSUs and PSUs provided to Company employees and non-employee directors.

The aggregate maximum number of shares that may be issued or transferred under the Incentive Plan is 0.7 million.

The Company currently grants RSAs, RSUs and PSUs provided to Company employees and non-employee directors pursuant to the 2024 Incentive Plan.

The 2024 Incentive Plan expires on March 24, 2034.

The Incentive Plan expires on May 14, 2034.

The terms of the awards (including vesting schedules) are established by the Compensation Committee of the Company’s Board of Directors.

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Earnings Per Share for further details.

RSAs are subject to vesting periods of up to five years .

RSAs are subject to vesting periods of up to three years .

Compensation expense for RSAs is calculated based on the average market price of the Company’s common stock at the date of grant and recognized over the requisite vesting period on a straight-line basis.

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As of December 31, 2025, there was $ 17.3 million of total unrecognized compensation cost related to RSAs which is expected to be recognized over a weighted-average period of 1.2 years .

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Restricted Stock Units

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Compensation cost for PSUs is based on the Company’s closing stock price on the date of grant, forecasted achievement of performance targets and the estimated grant date per share value of market-based performance utilizing a Monte Carlo simulation model.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table summarizes PSU activity and related information for 2025:

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Vested ( 16,900 ) $ 396.09

Performance adjustment 23,352 $ 424.14

Forfeited ( 1,069 ) $ 280.57

Nonvested at December 31, 2025

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Employee Stock Purchase Plan

On May 15, 2024, the Company’s shareholders approved the amendment and restatement of the Employee Stock Purchase Plan (the “ESPP Plan”).

As a result, the ESPP Plan authorizes the issuance of up to 4.75 million shares of common stock and provides that no options to purchase shares may be granted under the Purchase Plan after May 24, 2034.

The Employee Stock Purchase Plan (the “ESPP Plan”) authorizes the issuance of up to 4.75 million shares of common stock and provides that no options to purchase shares may be granted under the ESPP Plan after March 24, 2034.

The ESPP Plan is available to all employees of the Company and its participating subsidiaries and is a qualified plan as defined by Section 423 of the Internal Revenue Code.

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As of December 31, 2025, there were 340,960 sha res available for issuance under the ESPP Plan.

During the years ended December 31, 2024, 2023 and 2022, the Company iss ued 92,787 , 112,189 and 146,416 shares, respectively, of common stock to employees participating in the ESPP Plan.

During the years ended December 31, 2025, 2024 and 2023, the Company issued 87,082 , 92,787 and 112,189 shares, respectively, of common stock to employees participating in the ESPP Plan.

With respect to shares issued under the ESPP Plan, the Company’s Board of Directors has authorized specific share repurchases to fund the shares issuable under the ESPP Plan.

The weighted average per share fair value of employee stock purchase rights issued pursuant to the ESPP Plan was $ 68.92 , $ 50.04 an d $ 39.45 during the years ended December 31, 2024, 2023 and 2022, respectively.

The weighted average per share fair value of employee stock purchase rights issued pursuant to the ESPP Plan was $ 90.68 , $ 68.92 and $ 50.04 during the years ended December 31, 2025, 2024 and 2023, respectively.

The fair value of employee stock purchase rights is calculated using the grant date stock price, the value of the embed ded call option and the value of the embedded put option.

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Cash received from the ESPP Plan purchase s was $ 29.7 million , $ 24.4 million and $ 21.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Stock-Based Compensation

1 unchanged sentence

Stock-based compensation related to equity-settled awards was $ 29.0 million, $ 25.2 million and $ 20.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Stock-based compensation related to cash-settled awar ds was $ 5.0 million, $ 4.8 million and $ 0.5 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Stock-based compensation related to cash-settled awar d s was $( 0.5 ) million , $ 5.0 million and $ 4.8 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Tax benefits related to total stock-based compensation were $ 11.0 million , $ 8.3 million and $ 8.5 million for the years ended December 31, 2025, 2024 and 2023, respectively.

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Diluted EPS is computed by dividing net income available to diluted common shares by the weighted average number of dilutive common shares outstanding during the period.

The following table sets forth the calculation of EPS on total net income for the years ended December 31, 2024, 2023 and 2022 (in millions, except share and per share data):

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table sets forth the calculation of EPS on total net income (in millions, except share and per share data):

Years Ended December 31,

5 unchanged sentences

Earnings allocated to participating securities from continuing operations 3.7 10.5 14.8

Earnings (loss) allocated to participating securities from discontinued operations — — ( 0.1 )

Earnings allocated to participating securities from discontinued operations — — —

Net income available to basic common shares $ 321.5 $ 487.6 $ 586.8

2 unchanged sentences

Earnings allocated to participating securities from continuing operations 3.6 10.4 14.8

Earnings (loss) allocated to participating securities from discontinued operations — — ( 0.1 )

Earnings allocated to participating securities from discontinued operations — — —

Net income available to diluted common shares $ 321.5 $ 487.7 $ 586.9

Diluted earnings per common share $ 25.24 $ 36.81 $ 42.73

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

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Fixed Rate Long-Term Debt

On July 30, 2024, the Company issued $ 500.0 million in aggregate principal of 6.375 % Senior Notes due January 2030 (“ 6.375 % Senior Notes”).

The Company estimates the fair value of its $ 750.0 million 4.00 % Senior Notes due August 2028 (“ 4.00 % Senior Notes”) and the 6.375 % Senior Notes using quoted prices for the identical liability (Level 1) and estimates the fair value of its fixed-rate mortgage facilities using a present value technique based on current market interest rates for similar types of financial instruments (Level 2).

The Company estimates the fair value of its $ 750.0 million 4.00 % Senior Notes due August 2028 (“ 4.00 % Senior Notes”) and the $ 500.0 million 6.375 % Senior Notes due January 2030 (“ 6.375 % Senior Notes”) using quoted prices for the identical liability (Level 1) and estimates the fair value of its fixed-rate mortgage facilities using a present value method based on current market interest rates for similar types of financial instruments (Level 2).

Refer to Note 14.

Debt for further discussion of the Company’s long-term debt arrangements and the issuance of the 6.375 % Senior Notes.

Debt for further discussion of the Company’s long-term debt arrangements.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The carrying value and fair value of the Company’s fixed rate long-term debt were as follows (in millions):

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The inputs to the fair value measurements reflect Level 2 of the hierarchy framework.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Assets associated with the Company’s interest rate swaps, as reflected gross in the Consolidated Balance Sheets, were as follows (in millions):

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Total assets $ 45.5 $ 79.3

(1) As of December 31, 2024 and December 31, 2023 , the balance included gross fair value of $ 3.4 million and $ 3.7 million, respectively, related to the de-designated swaps as described below.

(1) As of December 31, 2025 and December 31, 2024 , the balance included gross fair value of $ 2.2 million and $ 3.4 million, respectively, related to the de-designated swap as described below.

There were no liabilities associated with the Company’s interest rate swaps as of December 31, 2025 and December 31, 2024 .

Interest Rate Swaps De-designated as Cash Flow Hedges

The Company de-designated one mortgage interest rate swap during each of the years ended December 31, 2024 and 2023 , due to the Company settling the underlying mortgages associated with the swaps.

As of December 31, 2024, the de-designated swaps had a total aggregate notional value of $ 34.0 million and a weighted average interest rate of 0.60 % .

The de-designated swaps will mature between January 4, 2025 and March 1, 2030.

The Company reclassified the entire previously deferred gains associated with the de-designated interest rate swaps of $ 0.2 million and $ 3.1 million, net of tax of $ 0.1 million and $ 1.0 million, during th e years ended December 31, 2024 and 2023, respectively, from AOCI into income as an adjustment to Other interest expense, net, as the remaining forecasted hedged transactions associated with the interest rate swaps were probable of not occurring due to the settlement of the mortgages described above.

The Company recorded unrealized mark-to-mark et losses of $ 0.5 million and $ 0.3 million and realized gains of $ 1.6 million and $ 1.0 million a ssociated with the de-designated interest rate swaps within Other interest expense, net, for the years ended December 31, 2024 and 2023 , respectively.

As of December 31, 2025 , the Company had one de-designated mortgage interest rate swap with a notional value of $ 25.0 million and an interest rate of 0.60 % .

The de-designated swap will mature on March 1, 2030.

No interest rate swaps were de-designated by the Company during the year ended December 31, 2025.

The Company recorded unrealized mark-to-mark et losse s of $ 1.3 million, $ 0.5 million and $ 0.3 million and realized gains of $ 1.0 million, $ 1.6 million and $ 1.0 million associated with the de-designated interest rate swaps within Other interest expense, net, for the years ended December 31, 2025, 2024 and 2023 respectively.

Interest Rate Swaps Designated as Cash Flow Hedges

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As of December 31, 2024, the Company held 28 interest rate swaps designated as cash flow hedges with a total notional value of $ 889.3 million that fixed its underlying SOFR at a weighted average rate of 1.23 %.

The maturity dates of the Company’s designated interest rate swaps range between February 14, 2025 and December 31, 2031.

The maturity dates of the Company’s designated interest rate swaps range between January 1, 2026 and December 31, 2031.

GROUP 1 AUTOMOTIVE, INC.

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Accounts and Notes Receivables

Accounts and notes receivable consist primarily of amounts due from manufacturers related to dealer incentives, and also includes receivables related to parts and service sales.

Accounts and notes receivable consist primarily of amounts due from manufacturers related to dealer incentives, and also include receivables related to parts and service sales.

The Company maintains an allowance for doubtful accounts that is calculated under the current expected credit loss (“CECL”) model.

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Used vehicles 765.3 729.4

Rental vehicles 246.7 217.2

Loaner vehicles

Parts, accessories and other 145.1 151.8

3 unchanged sentences

The lower of specific cost or net realizable value adjustments reduced total inventory cost by $ 16.0 million a nd $ 14.1 million at December 31, 2025 and 2024, respectively.

Interest assistance reduced inventory costs by $ 8.0 million a nd $ 7.0 million at December 31, 2024 and 2023, respectively, and reduced cost of sal es by $ 88.4 million, $ 71.2 million and $ 56.0 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Interest assistance reduced inventory costs by $ 10.5 million a nd $ 8.0 million at December 31, 2025 and 2024, respectively, and reduced cost of sales by $ 91.0 million, $ 88.4 million and $ 71.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Impairments of inventory, net of insurance proceeds, related to catastrophic events are included in Selling, general and administrative expenses in the Consolidated Statements of Operations.

During the years ended December 31, 2024, 2023 and 2022, the Company recorded $ 2.7 million, $ 3.4 million and $ 0.3 million of impairment charges, respectively.

During the years ended December 31, 2025, 2024 and 2023, the Company re corded $ 1.1 million, $ 2.7 million and $ 3.4 million of impairment charges, respectively.

Refer to Note 1.

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Property and equipment, net $ 3,137.4 $ 2,856.5

For the year ended December 31, 2025, the Company recognized $ 11.0 million of asset impairment charges related to property and equipment , consisting of $ 3.6 million in the U.S.

segment and $ 7.4 million in the U.K.

No asset impairments were recorded for the year ended December 31, 2024.

For the years ended December 31, 2023 and 2022, the Company recognized $ 6.8 million and $ 0.8 million , respectively, in asset impairment charges related to property and equipment in the Company’s U.S.

For the year ended December 31, 2023, the Company recognized $ 6.8 million of asset impairment charges related to property and equipment in the Company’s U.S.

Property and equipment impairment charges are reflected in Asset impairments in the Consolidated Statements of Operations.

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The Company has elected not to record leases with an initial term of 12 months or less on the balance sheet for all asset classes.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company reviews ROU assets for impairment at the lowest level of identifiable cash flows whenever evidence exists that the carrying value of an asset may not be recoverable (i.e., triggering events).

5 unchanged sentences

Financial Instruments and Fair Value Measurements.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

No impairm ents of ROU assets were recorded during the year ended December 31, 2024 .

During the year ended December 31, 2023, the Company recorded $ 1.8 million of impairments of ROU assets related to the U.S.

During the year ended December 31, 2025, the Company recorded $ 0.3 million of impairments of ROU assets related to the U.K.

No impairments of ROU assets were recorded during the year ended December 31, 2024.

During the year ended December 31, 2023 , the Company recorded $ 1.8 million of impairments of ROU assets related to the U.S.

The impairment charges were recognized within Asset impairments in the Company’s Consolidated Statements of Operations.

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Net lease expense $ 85.7 $ 74.6 $ 67.6

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 31, 2025

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Present value of lease liabilities $ 255.0 $ 329.5

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Years Ended December 31,

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Basis of Presentation, Consolidation and Summary of Accounting Policies for further discussion of the Company’s accounting policies relating to impairment testing.

For the October 31, 2024 annual goodwill impairment testing, the Company elected to perfor m a quantitative assessment on the U.K.

A triggering event was identified during the three months ended September 30, 2025, primarily due to macroeconomic factors as the U.K.

economy continues to face challenges, including persistent inflation, elevated interest rates, rising energy costs and a slowdown in consumer spending.

These factors have contributed to margin compression and increased operating expenses within the automotive retail industry.

The economic challenges in the U.K., coupled with the termination of certain franchise agreements further described below, constituted a triggering event indicating that goodwill and intangible franchise rights may be impaired.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As a result of the triggering event described above, the Company performed a quantitative assessment on the goodwill associated with the U.K.

reporting unit to determine whether the fair values of the U.K.

reporting unit were less than their carrying values.

Based on the results of the quantitative assessment for the U.K.

reporting unit, the Company recorded a goodwill impairment charge of $ 93.0 million for the three months ended September 30, 2025.

For the October 31, 2025 annual goodwill impairment test, the Company elected to perform a quantitative assessment on the U.K.

reporting unit and a qualitative assessment on the U.S.

reporting unit to determine whether the fair values of the Company’s reporting units were less than their carrying values.

Based on the results of the assessments, the Company did not record a goodwill impairment charge.

When a quantitative impairment assessme nt is performed, the Company estimates the fair value of goodwill using a combination of the market approach, and the discoun ted cash flow, or income approach.

The Company weights the market approach and the income approach 50 % and 50 %, respe ctively, in the fair value model.

For the market approach, the Company utilizes recent market multiples of guideline companies for both revenue and pre-tax net income weighted as appropriate by reporting unit.

For intangible franchise rights, the fair value of the respective franchise right is also estimated using a discounted cash flow, or income approach.

The income approach measures fair value by discounting expected future cash flows at a weighted average cost of capital (“WACC”) that proportionately weights the cost of debt and equity.

Significant assumptions in the model include revenue growth rates, future EBITDA margins, the WACC and terminal growth rates.

Based on the results of the assessments, the Company did not record an additional goodwill impairment charge for the year ended December 31, 2025.

When a quantitative impairment assessme nt is performed, the Company estimates the fair value of goodwill using a combination of the market approach and the income approach, also referred to as the discounted cash flow approach .

The Company weighs the market approach and the income approach equally in the fair value model.

For the market approach, the Company utilizes recent market multiples of guideline companies for both revenue and pre-tax net income.

The income approach measures fair value by discounting expected future cash flows at a WACC that proportionately weighs the cost of debt and equity.

Significant assumptions in the model include revenue growth rates, future earnings before interest, taxes, depreciation and amortization (“EBITDA”) margins, the fair value of non-operating assets, the WACC and terminal growth rates.

The Company applies a five-year projection period which aligns with the Company’s strategic plan.

Key considerations in the assumed growth rates include industry seasonally adjusted annual rate of vehicle sales projections, macroeconomic conditions including consumer confidence levels, unemployment rates and gross domestic product growth, and internal measures such as historical financial performance, cost control and planned capital expenditures.

Key considerations in the assumed growth rates include industry seasonally adjusted annual rate of vehicle sales projections, market share performance, macroeconomic conditions including consumer confidence levels, unemployment rates and gross domestic product growth, and internal measures such as historical financial performance, cost control and planned capital expenditures.

Beyond the five forecasted years, the terminal value is determined using a perpetuity growth rate based on long-term inflation projections for each reporting unit.

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Developing these assumptions requires applying management’s knowledge of the industry, recent transactions and reasonable performance expectations for its operations.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Intangible Franchise Rights

During the three months ended September 30, 2025, the Company elected to terminate franchise rights agreements associated with ten JLR dealerships in the U.K.

Formal notice of termination was provided to JLR, with an effective date of termination of August 2027.

As a result of the termination notice, the Company recorded a corresponding intangible franchise rights impairment charge of $ 18.1 million in the U.K.

segment for the three months ended September 30, 2025.

Based on the triggering event as described above, the Company examined its intangible franchise rights balance associated with the U.K.

reporting unit and identified certain U.K.

dealerships’ intangible franchise rights required further quantitative assessment.

This resulted in additional franchise rights impairment charges, unrelated to the OEM notification described above, of $ 5.4 million for the three months ended September 30, 2025.

For the October 31, 2025 annual intangible franchise rights assessment, the Company elected to perform a qualitative assessment.

Based on the results of the qualitative assessment, certain dealerships required a quantitative assessment based on their actual results through October 31, 2024 and an update of the annual budget in the fourth quarter of 2024.

To perform the intangible franchise rights quantitative assessment, the Company estimated the fair values of the respective franchise rights using a discounted cash flow, or income approach, following the income approach as described for Goodwill.

This resulted in franchise rights impairment ch arges of $ 28.2 million in the U.S.

segment and none in the U .K.

Based on the results of the qualitative assessment, certain dealerships required a quantitative assessment based on their actual results through October 31, 2025, as well as an update of the annual budget in the fourth quarter of 2025.

Based on the results of the assessment, the Company recorded franchise rights impairment charges of $ 63.3 million in the U.S.

segment and $ 1.6 million in the U.K.

segment during the three months ended December 31, 2025, bringing total intangible franchise rights impairment charges, excluding impairments associated with restructuring charges, to $ 63.3 million in the U.S.

segment and $ 27.8 million in the U.K.

segment for the year ended December 31, 2025.

The impairment charges were recognized within Asset impairments in the Company’s Consolidated Statements of Operations.

After recording these impairments, the remaining fair value associated with the intangible franchise rights tested, measured on a nonrecurring basis, was $ 39.0 million.

To perform the intangible franchise rights quantitative assessments described above, the Company estimated the fair values of the respective franchise rights using a discounted cash flow, or income approach, following the methodology for the income approach as described above for Goodwill.

During the year ended December 31, 2024, the Company recorded impairment charges of $ 28.2 million in the U.S.

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The impairment charges were recognized within Asset impairments in the Company’s Consolidated Statements of Operations.

During the year ended December 31, 2024, the Company recorded additional indefinite-lived intangible franchise rights acquired through business combinations of $ 178.1 million in the U.S.

segment and $ 121.8 million in the U.K.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

During the year ended December 31, 2025, the Company recorded additional intangible franchise rights acquire d through business combinations of $ 84.8 million in the U.S.

segment and none in the U.K.

During the year ended December 31, 2024 , the Company recorded additional indefinite-lived intangible franchise rights acquired through business combinations of $ 178.1 million in the U.S.

segment and $ 121.8 million in the U.K.

Refer to Note 3.

Acquisitions for further discussion of the Company’s acquisitions.

Acquisitions and Dispositions for further discussion of the Company’s acquisitions.

Each of the significant assumptions to the fair value model are considered level 3 inputs within the fair value hierarchy described further in Note 7.

Financial Instruments and Fair Value Measurements.

Developing these assumptions requires applying management’s knowledge of the industry, recent transactions and reasonable performance expectations for its operations.

The following table presents the significant unobservable inputs used in the assessment of intangible franchise rights:

Description Valuation Technique Unobservable Input Range (Average)

Intangible franchise rights

Discounted cash flow

Revenue growth rate

1.2 % — 10.4 % ( 2.8 %)

Long-term growth rate

EBITDA margin

( 0.2 )% — 1.6 % ( 1.0 %)

The following table presents the Company’s intangible franchise rights balances by segment as of December 31, 2025 and 2024 (in millions):

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Reclassified from (to) assets held for sale, net ( 19.6 ) — ( 19.6 )

Impairments — ( 93.0 ) ( 93.0 )

Currency translation — 21.5 21.5

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reporting unit.

(2) Net of accumulated impairments of $ 93.0 million in the U.K.

reporting unit.

GROUP 1 AUTOMOTIVE, INC.

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Revolving Credit Facility — floorplan notes payable

$ 1,388.5 $ 1,328.7

Revolving Credit Facility — floorplan notes payable offset account

( 504.2 ) ( 286.3 )

Revolving Credit Facility — floorplan notes payable, net

884.2 1,042.4

Other non-manufacturer facilities 199.3 212.9

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Revolving Credit Facility

In the U.S., the Company has a revolving syndicated credit arrangement with 20 participating financial institutions that matures on March 9, 2027 (the “Revolving Credit Facility”) .

On April 30, 2024, the Company entered into an amendment to the Revolving Credit Facility that increased the availability from $ 2.0 billion to $ 2.5 billion, with the ability to increase to $ 3.0 billion, as further described below.

On May 30, 2025, in the U.S., the Company entered into an amended revolving syndicated credit arrangement that matures on May 30, 2030, with 18 participating financial institutions (the “Revolving Credit Facility”).

In addition to extending the term, the amendment increased the availability from $ 2.5 billion to $ 3.5 billion, with the ability to increase to $ 4.5 billion, subject to lender approval.

The Revolving Credit Facility consists of two tranches:

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The capacity under these two tranches can be re-designated within the overall $ 3.5 billion commitment.

The Acquisition Line includes a $ 100 million sub-limit for letters of credit and a $ 50.0 million minimum capacity tranche.

The Company had $ 11.8 million and $ 12.2 million in letters of credit outstanding as of December 31, 2024 and 2023, respectively.

The Acquisition Line includes a $ 100 million sub-limit for letters of credit.

The Company had $ 11.8 million in letters of credit outstanding as of both December 31, 2025 and December 31, 2024 .

Floorplan Line bears interest at rates equal to SOFR plus 120 basis points for new vehicle inventory and SOFR plus 150 basis points for used vehicle inventory.

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Floorplan Line for specific vehicle inventory are to be repaid upon the sale of the vehicle financed and in no case is a borrowing for a vehicle to remain outstanding for greater than one year.

The Acquisition Line requires a commitment fee ranging from 0.15 % to 0.40 % per annum, depending on the Company’s total adjusted leverage ratio, based on a minimum commitment of $ 50.0 million less outstanding borrowings.

In conjunction with the Revolving Credit Facility, the Company had $ 3.1 million and $ 3.8 million of unamortized debt issuance costs as of December 31, 2024 and 2023, respectively, which are included in Prepaid expenses and Other long-term assets in the Company’s Consolidated Balance Sheets and amortized over the term of the facility.

The Acquisition Line requires a commitment fee ranging from 0.15 % to 0.40 % per annum, depending on the Company’s total adjusted leverage ratio.

In conjunction with the Revolving Credit Facility, the Company had $ 8.0 million and $ 3.1 million of unamortized debt issuance costs as of December 31, 2025 and December 31, 2024 , respectively, which are included in Prepaid expenses and Other long-term assets in the Company’s Consolidated Balance Sheets and amortized over the term of the facility.

Under the Revolving Credit Facility, dividends are permitted to the extent that no event of default exists, and the Company is in compliance with the financial covenants contained therein.

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The FMCC Facility bears interest at the U.S.

prime rate which was 7.50 % as of December 31, 2024.

prime rate w hich was 6.75 % a s of December 31, 2025.

GM Financial Facility

During 2023, the Company entered into a master loan agreement with General Motors Financial (the “GM Financial Facility”).

During the year ended December 31, 2024, additional subsidiaries of the Company entered into the GM Financial Facility as additional borrowers and the borrowing base thereunder was increased.

As of December 31, 2024 and December 31, 2023 , the GM Financial Facility had a total capacity of $ 348.1 million and $ 84.5 million , respectively.

The Company has a master loan agreement with General Motors Financial for financing of new GM vehicles (the “GM Financial Facility”).

The GM Financial Facility bears interest at the U.S.

prime rate less 100 basis points.

As of December 31, 2025 , the GM Financial Facility had a total borrowing capacity of $ 376.7 million .

Other Manufacturer Facilities

The Company has other credit facilities in the U.S.

and the U.K., respectively, with financial institutions affiliated with manufacturers for financing of new, used and rental vehicle inventories.

As of December 31, 2024, borrowings outstanding under these facilities totaled $ 377.2 million, comprised of $ 190.0 million in the U.S.

and $ 187.2 million in the U.K., with annual interest rates ranging from 1 % to approximately 8 %.

Interest rates on the Company’s manufacturer facilities vary across manufacturers.

and the U.K., respectively, with financial institutions affiliated with manufacturers for financing of new, used and loaner vehicle inventories.

As of December 31, 2025, borrowings outstanding under these facilities totale d $ 442.2 million, comprised of $ 212.5 million in the U.S.

and $ 229.7 million in the U.K., with annual interest rates ranging from approximately 1 % to 8 %.

Int erest rates on the Company’s manufacturer facilities vary across manufacturers.

Offset Accounts

Offset accounts consist of immediately available cash used to pay down the U.S.

Floorplan Line and FMCC Facility, and therefore offset the respective outstanding balances in the Company’s Consolidated Balance Sheets.

Floorplan Line, FMCC Facility and GM Financial Facility, and therefore offset the respective outstanding balances in the Company’s Consolidated Balance Sheets.

The offset accounts are the Company’s primary options for the short-term investment of excess cash.

In May 2025, the Company entered into an addendum to the master loan agreement with General Motors Financial and established an offset account under the GM Financial Facility (the “GM Floorplan Offset”).

As of December 31, 2025, there was no balance for the GM Floorplan Offset account.

GROUP 1 AUTOMOTIVE, INC.

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Total $ 3,712.7

6.375 % Senior Notes Issuance

On July 30, 2024, the Company issued the following notes, at par:

Description Principal Amount

(in millions) Maturity Date Effective Interest Rate (1)

Interest Payment Dates

6.375 % Senior Notes

$ 500.0 January 15, 2030 6.661 % January 15 th , July 15 th

(1) The effective interest rate is after the impact of associated debt issuance costs.

The Company may redeem up to 40 % of the original principal amount of the 6.375 % Senior Notes, plus accrued and unpaid interest, at any time prior to July 15, 2026, subject to certain conditions.

The Company, at its option, may redeem some or all of the 6.375 % Senior Notes at the redemption prices (expressed as percentages of principal amount of the notes) set forth below, plus accrued and unpaid interest.

Redemption Period Redemption Price

July 15, 2026 103.188 %

July 15, 2027 101.594 %

July 15, 2028 and thereafter 100.000 %

The 6.375 % Senior Notes are unsecured obligations and rank equal in right of payment to all of the Company’s existing and future senior unsecured debt and senior in right of payment to all of the Company’s future subordinated debt.

The 6.375 % Senior Notes are subordinated to all existing and future senior secured debt of the Company and subordinated to all existing and future liabilities (including trade payables) of any non-guarantor subsidiaries.

The 6.375 % Senior Notes are guaranteed by substantially all of the Company’s U.S.

subsidiaries.

subsidiary guarantees rank equally in the right of payment to all of the Company’s guarantor’s existing and future senior debt and rank senior in right of payment to all of the Company’s guarantor’s existing and future subordinated debt.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company may be required to purchase the 6.375 % Senior Notes if it sells certain assets or triggers the change in control provisions defined in the indenture governing the 6.375 % Senior Notes.

The indenture governing the 6.375 % Senior Notes contains customary restrictions on the Company, including the ability to pay dividends, incur additional indebtedness, create liens, sell or otherwise dispose of assets and repurchase shares of outstanding common stock, which are consistent with those contained in the indenture governing the Company’s 4.00 % Senior Notes.

Acquisition Line

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Floorplan Notes Payable), totaled $ 964.0 million .

The average interest rate on this facility was 5.92 % as of December 31, 2024.

The weighted average interest rate on this facility was 5.52 % for the year ended December 31, 2025.

Real Estate Related

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As of December 31, 2025, borrowings outstanding under these facilities totaled $ 1,151.0 million, gross of debt issuance costs, comprised of $ 760.8 million in the U.S.

and $ 410.5 million in the U.K., respectively.

and $ 390.2 million in the U.K., res pectively.

The Company’s mortgage loans are secured by real property owned by the Company.

The carrying values of the related collateralized real estate as of December 31, 2025 and 2024 were $ 1,538.6 million and $ 1,612.9 million, respectively.

In February 2024, the Company entered into a master credit agreement with Wells Fargo Bank, National Association (the “Wells Fargo Credit Agreement”), which provides for delayed draw term loans with a maximum borrowing capacity of $ 258.3 million.

The Company has a master credit agreement with Wells Fargo Bank, National Association (the “Wells Fargo Credit Agreement”), which provides for delayed draw term loans with a maximum borrowing capacity of $ 258.3 million.

The Wells Fargo Credit Agreement accrues interest at SOFR plus 175 basis points and matures on March 1, 2031.

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Leases for further information regarding the Company’s finance leases.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The Company has adopted ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures, effective for the year ended December 31, 2025.

As a result of this adoption, the Company’s income tax disclosure below now includes additional information related to the effective tax rate reconciliation and income taxes paid.

Income from continuing operations before income taxes by geographic area was as follows (in millions):

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Provision for income taxes $ 126.2 $ 161.5 $ 198.2

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A reconciliation of the statutory federal rate to the effective tax rate on income before income taxes from continuing operations was as follows (in millions):

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2025 2024 2023

Provision at the U.S.

PTI Tax % PTI Tax % PTI Tax %

federal statutory rate $ 449.9 $ 94.5 21.0 % $ 658.5 $ 138.3 21.0 % $ 800.2 $ 168.0 21.0 %

Increase (decrease) resulting from:

State income tax, net of benefit for federal deduction 21.0 25.2 22.3

Foreign income tax rate differential ( 2.1 ) 0.6 ( 2.3 )

State income taxes, net of federal benefit (1)

15.6 3.5 % 19.7 3.0 % 22.7 2.8 %

Foreign tax effects

Goodwill impairments 22.7 5.0 % — — % — — %

Other ( 0.1 ) — % 2.3 0.3 % 1.9 0.2 %

Other Foreign Jurisdiction ( 4.3 ) ( 1.0 ) % ( 1.9 ) ( 0.3 ) % ( 1.0 ) ( 0.1 ) %

Effect of cross-border tax laws — — % 1.7 0.3 % 1.8 0.2 %

Tax credits ( 3.3 ) ( 0.7 ) % ( 3.9 ) ( 0.6 ) % ( 0.5 ) ( 0.1 ) %

Change in valuation allowance ( 1.6 ) ( 2.6 ) ( 2.1 )

Stock-based compensation ( 2.9 ) ( 3.6 ) ( 1.6 )

Deferred state tax effect — ( 1.1 ) 4.3

Gain on dispositions 3.2 5.5 —

Changes in valuation allowances — — % — — % — — %

Nontaxable or nondeductible items 2.5 0.6 % 2.1 0.3 % 0.7 0.1 %

Changes in unrecognized tax benefits — — % — — % — — %

Other ( 1.4 ) ( 0.3 ) % 3.2 0.5 % 4.6 0.6 %

Provision for income taxes $ 449.9 $ 126.2 28.0 % $ 658.5 $ 161.5 24.5 % $ 800.2 $ 198.2 24.8 %

(1) State taxes in California, Massachusetts, Oklahoma and Texas made up the majority (greater than 50%) of the tax effect in this category.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Taxes paid, net of refunds, were as follows (in millions):

Years Ended December 31,

2025 2024 2023

Federal $ 91.1 $ 115.1 $ 143.7

State 15.6 20.7 22.1

Foreign (U.K.) 1.4 10.2 18.0

$ 108.1 $ 146.0 $ 183.8

The components of deferred tax assets and liabilities were as follows (in millions):

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Net deferred tax liability $ 331.1 $ 295.8

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

As of December 31, 2025, the Company had state pre-tax net operating loss carryforwards in the U.S .

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Based on the statutes of limitations in the applicable jurisdictions in which the Company operates, the Company is generally no longer subject to examinations by tax authorities in years prior to 2020.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A reconciliation of the Company’s unrecognized tax benefits is as follows (in millions):

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Participants receive a rate of return as determined by management and approved by the Board of Directors.

The balances due to participants of the Deferred Compensation Plan as of December 31, 2024 and 2023, were $ 111.8 million and $ 108.4 million, resp ectively, with $ 7.9 million and $ 8.1 million c lassified as current for each respective period.

The balances due to participants of the Deferred Compensation Plan as of December 31, 2025 and 2024, were $ 116.8 million and $ 111.8 million, respectively, with $ 7.0 million and $ 7.9 million classified as current for each respective period.

In the U.S., the Company offers a 401(k) plan to eligible employees and provides matching contribution to employees that participate in the plan.

2 unchanged sentences

For the years ended December 31, 2025, 2024 and 2023, the matching contributions paid by the Company totaled $ 12.4 million, $ 8.5 million and $ 5.2 million, respectively.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

COMMITMENTS AND CONTINGENCIES

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Although the Company has no reason to believe that it will be called upon to perform under any such assigned leases, the Company estimates that lessee remaining rental obligations were $ 27.5 million as of December 31, 2025.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

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54.8 ( 6.1 ) 48.7

— ( 6.7 ) ( 6.7 )

Amounts reclassified from accumulated other comprehensive income (loss):

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— ( 10.8 ) ( 10.8 )

Reclassification related to de-designated interest rate swaps (pre-tax) — ( 0.2 ) ( 0.2 )

Provision for income taxes — 6.3 6.3

Net current period other comprehensive loss ( 19.1 ) ( 7.4 ) ( 26.5 )

Net current period other comprehensive income (loss) 54.8 ( 24.9 ) 30.0

Balance, December 31, 2025

$ ( 1.7 ) $ 33.3 $ 31.6

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2024

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Provision for income taxes — 9.0 9.0

Net current period other comprehensive income (loss) 23.7 ( 18.0 ) 5.7

Net current period other comprehensive loss ( 19.1 ) ( 7.4 ) ( 26.5 )

Balance, December 31, 2024

$ ( 56.5 ) $ 58.2 $ 1.6

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2023

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— ( 17.9 ) ( 17.9 )

Cumulative foreign currency translation adjustments associated with the Brazil Disposal 122.8 — 122.8

Other cumulative foreign currency translation adjustments 1.5 — 1.5

Reclassification related to de-designated interest rate swaps (pre-tax)

— ( 4.0 ) ( 4.0 )

Provision for income taxes — 8.9 8.9

Net current period other comprehensive income 97.1 81.6 178.7

Net current period other comprehensive income (loss) 23.7 ( 18.0 ) 5.7

Balance, December 31, 2023

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Non-cash Activities

The accrual for capital expend itures, was $ 9.0 million, $ 6.7 million and $ 4.7 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Interest and Income Taxes Paid

The accrual for capital expend itures was $ 3.7 million and $ 9.0 million as of December 31, 2025 and 2024, respectively.

Interest Paid

Cash paid for interest, including the monthly settlement of the Company’s interest rate swaps, was $ 268.2 million, $ 223.6 million and $ 154.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

1 unchanged sentence

Financial Instruments and Fair Value Measurements for further discussion of the Company’s interest rate swaps.

Cash paid for income taxes, net of refunds, was $ 146.0 million , $ 183.8 million and $ 202.2 million for the years ended December 31, 2024, 2023 and 2022, respectively.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

SEGMENT INFORMATION

The Company has adopted ASU 2023-07, Segment Reporting (Topic 820):

Improvements to Reportable Segment Disclosures, effective retrospectively for the year ended December 31, 2024.

As a result of this adoption, the Company’s segment disclosure below now includes significant expense categories.

The Company’s segment performance measure remains unchanged.

As of December 31, 2025, the Company had two operating and reportable segments:

The Company defines its segments as those operations whose results the Company’s Chief Executive Officer, who is the Chief Operating Decision Maker (“CODM”), regularly reviews to analyze performance and allocate resources at the U.S.

geographic areas.

4 unchanged sentences

and sell vehicle parts.

The CODM uses income before income taxes predominantly in making decisions about the allocation of operating and capital resources to each segment, evaluating annual budget and forecast, as well as determining compensation for certain employees.

The CODM predominantly uses the metric of income before income taxes in making decisions about the allocation of operating and capital resources to each segment, evaluating annual budget and forecast, as well as determining compensation for certain employees.

The accounting policies of the segments are the same as those described in the Company’s summary of accounting policies.

2 unchanged sentences

Basis of Presentation, Consolidation and Summary of Accounting Policies for further discussion of the Company’s accounting policies.

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Selected reportable segment data for continuing operations as follows (in millions):

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$ — $ 28.4 $ 28.4

Other operating (income) expense

$ ( 10.0 ) $ — $ ( 10.0 )

Floorplan interest expense $ 74.7 $ 26.8 $ 101.5

2 unchanged sentences

$ ( 0.2 ) $ — $ ( 0.2 )

Income before income taxes $ 652.2 $ 6.3 $ 658.5

Income (loss) before income taxes

$ 563.1 $ ( 113.2 ) $ 449.9

Capital expenditures:

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Total capital expenditures $ 238.0 $ 32.0 $ 270.0

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2024

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Asset impairments $ 33.0 $ — $ 33.0

Restructuring charges $ — $ 16.7 $ 16.7

Other operating income

$ ( 10.0 ) $ — $ ( 10.0 )

Floorplan interest expense $ 88.8 $ 19.8 $ 108.5

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Total capital expenditures $ 191.3 $ 53.7 $ 245.1

GROUP 1 AUTOMOTIVE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Year Ended December 31, 2023

14 unchanged sentences

Total capital expenditures $ 156.2 $ 29.3 $ 185.4

(1) Other segment items include other expenses, which primarily relate to currency translation losses.

(1) Other segment items include other expenses, which primarily relate to currency translation.

December 31, 2025

1 unchanged sentence

Total assets (1)

$ 8,146.3 $ 2,183.0 $ 10,329.3

December 31, 2024

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Total assets (1)

$ 7,630.1 $ 2,176.6 $ 9,806.6

(1) Total assets for reportable segments exclude the total assets related to discontinued operations.

The assets related to discontinued operations were immaterial as of December 31, 2025 and December 31, 2024.

Refer to Note 12.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures