Driven Brands Holdings Inc. officials announced Nov. 3 that newly discovered accounting errors will require another round of corrections to financial results, including figures already restated earlier this year.
The errors primarily concern how assets were recorded, depreciated and written off. According to the release, managers of the Charlotte-based parent of CARSTAR and Maaco, found them while preparing for subsidiary audits.
The review covers annual financial statements for 2023, 2024 and 2025, along with quarterly results for 2024, 2025 and the first half of 2026. The board’s audit committee determined on Oct. 31 that the affected statements should no longer be relied upon.
The announcement follows an earlier accounting review disclosed in February. That review uncovered overstated cash and revenue, unrecorded leases and expenses assigned to incorrect categories. It delayed publication of the 2025 annual report until May 19.
The corrections published in May reduced cash reported at the end of 2024 by US$28 million and accounts receivable by US$26 million. They also added US$40 million in previously unrecorded lease liabilities.
The earlier restatement reduced reported net income by US$54 million for 2023, US$5 million for 2024 and US$5 million through the first three quarters of 2025. Those corrected accounts are now subject to further revision.
During the May earnings call, Danny Rivera, president and chief executive officer, attributed the earlier problems to rapid expansion and financial systems integration that had outpaced accounting staff, processes and controls. Chief financial officer Mike Diamond linked cash accounting problems largely to Auto Glass Now and described technology integration failures involving the Driven Advantage marketplace.
The earlier reporting delays prompted Nasdaq notices over late filings. Management subsequently confirmed that compliance with reporting requirements had been restored on June 12.
The latest findings will delay the third-quarter earnings call and quarterly report. Management confirmed that the report would miss its Nov. 5 deadline and the available five-day extension.
“Our top priority is to complete the restatement, continue to strengthen our processes and controls, and earn back trust one quarter at a time,” Rivera said in the Nov. 3 press release.
Management expects accounting correction costs to reach at least US$50 million in 2026, with further expenses in 2027. No completion date has been set.
The revised annual forecast puts adjusted earnings before interest, taxes, depreciation and amortization at US$410 million to US$430 million, down from US$430 million to US$460 million.
The review is also affecting franchise expansion. Delayed audits have held up franchise disclosure documents needed for new openings. Management expects those delays to continue until the accounts are corrected and updated documents are issued.
