Good afternoon, my name is Konstantin, and I will be your conference operator today. At this time, I would like to welcome everyone to the Boyd investor call. All lines have been placed on mute to prevent any background noise. At this time, you may begin your conference.
Thank you for listening to the Boyd Group Services Inc.'s call. Listeners are reminded that certain matters discussed on today's call could constitute forward-looking statements that are subject to risks and uncertainties relating to Boyd's future financial or business performance. Actual results could differ materially from those anticipated in these forward-looking statements. The risk factors that may affect results are detailed in Boyd's Annual Information Form and other periodic filings and registration statements, and you can access these documents at SEDAR+'s database found at sedarplus.ca . At this time, I'll pause on Slide 2 and remind you that we will be referring to forward-looking information during today's presentation. By its nature, this information contains forecasts, assumptions, and expectations about future outcomes, which are subject to the risks and uncertainties outlined here and discussed more fully in our public disclosure filings.
We'll also be referring to non-GAAP measures summarized on Slide 4, which are reconciled to their most directly comparable GAAP measures in the appendices to this presentation and in our public filings. On the call with us today is Mr. Brian Kaner, President and Chief Executive Officer, and Mr. Jeff Murray, Chief Financial Officer. Please go ahead, Mr. Kaner.
Hello all. Thank you for joining our call today. I'm excited to announce that Boyd Group has entered into a definitive agreement to purchase Joe Hudson's Collision Center, a leading player in the North American collision industry, for $1.3 billion. As highlighted on Slide 6, Boyd Group was founded in 1990 and since that time has grown to become the third largest player in the $50 billion North American collision industry, with over 1,000 locations and $3 billion in revenue for the trailing 12 months ended June 30, 2025. Over the past 10 years, we have grown our revenue at a 15% compound annual growth rate, and our outlook remains strong as we continue to focus on expanding our footprint, achieving scale to enhance our operations, and better serve our customers.
Before we discuss Joe Hudson's acquisition, I would like to take a few minutes to share our estimated preliminary third-quarter results for the period ending September 30, 2025. As you can see on Slide 7 of today's presentation, Boyd generated strong results during the third quarter, with a key highlight coming from an expected return to positive same-store sales growth. For the quarter, we expect revenue to increase approximately 5% from a year ago, driven by the expectation of 2%-2.5% same-store sales growth, with the remainder coming from new location growth. Alongside revenue growth, we anticipate an improvement in Adjusted EBITDA margin, expected to be between 12.3%-12.5% during the quarter, increasing approximately 170 basis points over the same period last year. This increase is expected to generate 21%-23% growth in Adjusted EBITDA in the quarter.
Over the past year, we have witnessed a rise in used car prices and moderation in auto insurance premiums, both of which are important drivers of industry volumes. It's been exciting to see these trends translate into an improving repairable claims environment over the past quarter, enabling us to start generating positive same-store sales growth. This backdrop, coupled with the successful execution of Project 360 and additional progress on internalization of scanning and calibration, were all important contributors to our strong results in the quarter. With a strong foundation in place alongside an improvement in industry conditions, it is an opportune time for Boyd to accelerate our growth, which we are doing today with our acquisition of Joe Hudson's Collision Center. As summarized on Slide 9 and 10, this is a highly strategic acquisition for Boyd.
It increases our location count by 25% to 1,273 locations, densifies the regions in which we operate, enhances our margins, and solidifies our positions as one of the leading players in the North American collision industry. In addition, given the anticipated synergies and attractive purchase multiple, we expect to be able to complete the acquisition while maintaining our strong balance sheet. Turning to Slide 11, Joe Hudson's was founded in 1989 in Alabama and now operates 258 collision locations across 18 states. Throughout its history, Joe Hudson's has successfully executed a highly strategic growth strategy, which has seen it concentrate its growth within the U.S. Southeast region. Currently, approximately 85% of its locations are situated in only 10 states, and its larger states include Texas, Florida, Alabama, and South Carolina. This strategy has provided Joe Hudson's with a strong industry position, including providing exposure to the growing U.S. Southeast market.
As highlighted on Slide 12, the states in which Joe Hudson's operates have benefited from positive demographic drivers, resulting in an above-average population growth over the past four years and above-average growth in vehicle miles traveled between August of 2019 and August of 2025. In addition to these positive market conditions, this concentrated focus also provides densification benefits, including margin expansion opportunities through operational improvements and the ability to provide superior customer service to both the consumer and insurance customer clients. Moving on to Slide 13, over its history, Joe Hudson's has established a strong track record of growth and profitability. Since 2020, Joe Hudson's has grown its location count by a 20% compound annual growth rate, with the growth coming from both acquisitions and new startup locations.
For the trailing 12 months ended June 30, 2025, Joe Hudson's has generated $722 million in sales and a strong Adjusted EBITDA margin of 8.7%. Once adjusted for lease payments, which provides a more consistent comparison to Boyd Group's reported financial results, Joe Hudson's EBITDA margin over the same period was 14.4%. Slide 14 of today's presentation provides an overview of the strong strategic rationale for the acquisition. As you can see from the table, the transaction increases our locations by 25%. The majority of this growth is coming from our existing markets, with only two new states being added through the combination of our two businesses. In addition, the acquisition solidifies our position as a leading player in the North American market, while at the same time providing us a significant potential for long-term growth, given our combined estimated revenue share of only 7.6%.
Lastly, as a result of Joe Hudson's strong profitability and meaningful expected synergies, this transaction is accretive to our Adjusted EBITDA margins and positions us well for future margin expansion through continued execution of our Project 360 initiatives. As we turn to Slide 15, the map summarizing our combined locations highlights the complementary and strategic nature of today's transaction. These include densification within the U.S. Southeast region, as well as the concentration of our locations on the eastern half of the U.S. While this greater density enhances our margin potential through operational improvements, it also provides us the opportunity to better service insurance company clients, providing the opportunity for continued sales growth. In terms of our growth, as seen on Slide 16, Boyd has a long history of unit growth, with acquisitions being a key contributor to this growth.
Since our founding in 1990, we have grown our locations through a combination of single-shop and large multi-shop operator acquisitions, as well as the opening of new startup locations. What we have grown to learn since starting our discussions with Joe Hudson's is that it has adopted a very similar growth strategy to Boyd in terms of new location growth. Since the end of 2020, Joe Hudson's has acquired 123 locations and opened 17 new startup locations. In addition, the company has more than doubled its location count since 2020. Our established long-term track record of both acquisitions and integration gives us the confidence in our ability to successfully integrate the Joe Hudson's team into our operations while at the same time generating strong synergies and shareholder value.
I will now pass it over to Jeff to provide more details on the expected synergies as well as the transaction details and financing summary.
Thanks, Brian. And thank you, everyone, for joining us today. As Brian mentioned, it is an exciting day for Boyd as we announce the acquisition of Joe Hudson's. As we have mentioned on previous earnings conference calls, we would be patient to watch for an opportunity to buy a larger-scale multi-shop operator that was the right partner at the right time. We believe both objectives will be achieved with this acquisition. Joe Hudson's has a strong track record of growth and profitability and is also highly complementary to our business. This alignment spans geographic presence, growth strategy, operational discipline, and culture. In terms of timing, we believe that the improvement in industry conditions, which began to evolve late in the second quarter and continued in the third quarter, positions Boyd well for future success.
Ultimate funding of the transaction, as described on Slide 17, is anticipated through a combination of equity and debt securities, as well as bank facilities. Financing will be structured to ensure Boyd maintains a strong balance sheet, consistent with its long track record of financial discipline. In the meantime, we have secured fully committed financing to fund the acquisition. At the time of closing of the transaction, we expect our net debt before lease liabilities to Adjusted EBITDA after lease payments to be 3.4x , up from 2.7x at the end of the second quarter of 2025. We expect to see this leverage ratio decline to our current levels as early as the end of 2027. As we have highlighted in Slide 18, we expect to generate meaningful potential synergies from this transaction. Identified synergies total $35-$45 million.
We target achieving these synergy goals by 2028, with 50% of these synergies targeted for completion in the near term. There are several different avenues from which we expect to achieve these synergies, including both direct and indirect procurement savings, the internalization of Joe Hudson's scanning and calibration services, efficiencies achieved through increased densification, as well as operational and administrative cost savings. A number of these synergies, namely procurement savings and internalization of scanning and calibration, are two initiatives that are underway today within Boyd, providing us with a high level of confidence in our ability to achieve these synergy targets. In addition, as Brian highlighted, the complementary nature of our combined location footprint enhances our density in several geographic markets, providing visibility into potential efficiency improvements across both businesses. The purchase price of the transaction is $1.3 billion, or approximately $1.15 billion net of tax benefits.
The purchase price net of expected tax benefits represents a purchase multiple of 13.3x Joe Hudson's last 12 months ended June 30, 2025, Adjusted EBITDA, assuming run rate adjustments. When incorporating the anticipated synergies, this purchase multiple decreases to 9.3x . The acquisition is expected to be accretive to Adjusted Net Earnings per Share after synergies in the first full year. We expect to close the acquisition in the fourth quarter of 2025, subject to satisfaction of customary closing conditions and regulatory approvals. Before I turn it over to Brian for closing remarks, I want to thank everyone once again for participating on the call today, and we look forward to providing a further update on our business during our third quarter earnings call on November 12th. Brian?
Thanks, Jeff. As I highlighted in my opening remarks, this is a significant milestone for Boyd. Today's transaction is fully aligned with our goal of solidifying our position as one of the leading players in the highly fragmented North American collision industry, densifying our regional presence, and accelerating our profitability. I believe the many initiatives that have been underway at Boyd over the last several years, including Project 360, our new go-to-market strategy, and expanded WOW Operating Way, position us well to take advantage of the improvement in industry conditions. These initiatives, complemented by Joe Hudson's strong profitability and strategic growth strategy, position Boyd to continue executing on its long-term growth strategy while generating strong long-term value creation for shareholders. Thank you for your time, and we look forward to engaging with you as we embark on this next exciting chapter.