Boyd Group, (TSX: BYD.TO), the Canada-based parent company of Gerber Collision & Glass in the U.S., announced a five-year goal of reaching $5 billion in annual revenue in 2029, up from its current $3 billion, and achieving the No. 1 or No. 2 market share position in every market it serves.
“(T)his plan delivers continued double-digit percentage revenue growth and accelerated profitability,” said Tim O’Day, CEO of Boyd Group until his retirement in May, when Brian Kaner will move into that position. “I am confident in Brian and the team’s ability to execute this plan and capitalize on the significant opportunities in our highly fragmented market.”
Boyd Group CEO Tim O'Day.
O’Day had been with Gerber Collision for six years when that company was acquired by Boyd in 2004. Since then, he has served in various leadership roles, including becoming chief operating officer for all of Boyd’s North American collision operations in 2017, before becoming CEO in 2020. The company late last fall announced its succession plan following O’Day’s retirement this spring.
During a recent call with financial analysts, Kaner acknowledged “the North American collision industry faced several short-term headwinds in 2024, including a mild winter, rising total loss rates due to lower used car prices, customers deferring claims amid economic uncertainty and the significant increase in insurance premiums.”
But given Boyd’s performance history, he said, he was confident in the company’s ability to meet its new five-year goals, including doubling its adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) to $700 million. Kaner said this goal is based not just on adding new locations along with same-store growth of 3% to 5%, but also on “the implementation of a company-wide cost optimization initiative, focused on enhancing profitability and returns across the organization.”
Through that initiative, launched in Q4 2024, he said, the company “expects to achieve $100 million in recurring annual cost savings” over a five-year period. The cost savings, Kaner said, focus on “structural costs that we can take out of the business, plus leveraging the size and scale we have to get better discount structures with our vendor, and better positioning ourselves with a fewer number of partners that are out there.”
He said he expects about half of Boyd’s store count growth in the next five years to be new brownfield and greenfield locations, with the rest being single shop and “small multi-location acquisitions.”
“While our pace of single-shop growth slowed in 2024 as we focused on the short-term headwinds in our market, we have a robust pipeline of opportunities to add new locations in our markets,” Kaner said.
Jeff Murray, executive vice president and CFO for Boyd Group, said the company’s “solid balance sheet and strong cashflow generation” makes it well-positioned to fund such growth.
“We will continue to allocate a substantial portion of our capital toward growing the business, capitalizing on opportunities with the highest returns,” Murray said on the call with financial analysts.
Boyd is the second-largest shop operator in North America, behind Caliber Collision, with about 840 U.S. shops and about 140 in Canada under the trade names Boyd Autobody & Glass and Assured Automotive as of the end of 2024. Kaner said the company holds about 6% of the total market share in the industry, and the company’s five-year growth plans would help it reach about 10% market share by 2029.
John Yoswick