America's Car-Mart Reports Diluted Earnings per Share of $.81 on Revenue Increase of 12.2% to $138 Million
May 21 2015 - 5:56PM
America's Car-Mart, Inc. (Nasdaq:CRMT) today announced its
operating results for the fourth quarter and full fiscal year 2015.
Highlights of fourth quarter operating
results:
- Net income of $7.2 million - $.81 per diluted share vs. $.68
per diluted share
- Revenues of $138 million compared to $123 million for the prior
year quarter with same store revenue growth of 7.5%
- Retail unit sales increase of 10.7% to 11,699 from 10,565 for
the prior year quarter with 28.1 retail units sold per dealership
per month up from 26.9 for prior year quarter
- Average retail sales price increased $222 to $10,007 or 2.3%
from the prior year quarter
- Net charge-offs as a percent of average finance receivables of
7.8%, down from 8.3% for prior year quarter
- Provision for credit losses of 25.0% of sales compared to 25.3%
of sales for prior year quarter
- Selling, General and Administrative Expenses at 17.2% of sales
vs. 17.9% for prior year quarter
- Active accounts base now over 64,000
- Debt to equity of 44.8% and debt to finance receivables of
24.6%
- Allowance for credit losses at 23.8% of finance receivables,
net of deferred revenue at April 30, 2015
Highlights of full fiscal year operating
results:
- Net income of $29.5 million or $3.25 per diluted share vs.
$2.25 per diluted share for fiscal 2014 (the prior year amount
would have been $2.76 per diluted share excluding a $4.9 million
non-cash after-tax charge resulting from an increase to the
allowance for credit losses made in the third quarter)
- Revenue increase of 8.4% to $530 million from $489 million for
the prior year period with same store revenue growth of 2.9%
- Retail unit sales increase of 9.9% to 46,760 from 42,551 for
the prior year period
- Net charge-offs as a percentage of average finance receivables
of 27.8% compared to 28.2% for the prior year
- Provision for credit losses of 25.5% of sales vs. 27.4% (25.7%
excluding the effect of the $7.7 million increase in the allowance
for credit losses made in the third quarter) for prior year
period
- Strong cash flows supporting the significant increase in
revenues, the $38.0 million increase in finance receivables and the
$4.2 million increase in inventory, $4.0 million in net capital
expenditures and $20.0 million in common stock repurchases (442,700
shares) with only a $5.7 million increase in total debt
"As we expected, we saw a nice improvement at the top line for
the quarter and are pleased to see the increase in sales
productivity. Our general managers are doing a very nice job of
executing our sales plan and are working hard to attract customers
looking for good, basic and affordable transportation to go with
Car-Mart's excellent service. We believe that we offer our local
markets a better value by staying focused on customer success.
Retail units sold was up 10.7% and same store revenue was up 7.5%
when compared to the fourth quarter of fiscal 2014. Productivity,
as reflected in the average retail units sold per month per store,
increased from 26.9 to 28.1 for the quarter," said William H.
("Hank") Henderson, President and Chief Executive Officer of
America's Car-Mart, Inc. (the "Company"). "As always, we are
committed to growing our Company in a healthy manner with customer
success being the priority. Competition remains tough, but we know
that we can execute at a much higher level, specifically as related
to our lot level collections efforts. We remain committed to
continuing to grow the business in the face of increased
competitive pressures which have been prevalent for the last few
years. We believe that there is a significant number of good,
hard-working folks who deserve the opportunity to succeed with
Car-Mart, and we will continue to expand to meet this need."
"We now have 141 dealerships in ten states, an increase of seven
from this time last year. We currently have seven new location
projects in process. Our next dealership opening will be in June in
Rolla, Missouri. We are very excited about our expansion plans as
we will be adding a new state this year, Iowa. We have already
secured a location in Burlington, Iowa and are currently looking at
a few other prospects in the state. As always, we look forward to
adding value to the markets we will serve. We are looking to pick
up the pace of new lot openings in 2016 and the seven projects in
process right now will certainly help," added Mr. Henderson. "We
are pleased with the top line growth and remain convinced that we
are moving the company in the right direction."
"The increased top line allowed us to see solid leveraging of
our selling general and administrative expenses for the quarter,
which decreased to 17.2% of sales from 17.9% for the fourth quarter
of last year. As always, we will remain focused on ensuring that
dollars we spend are spent wisely, keeping in mind the fact that we
will need to continue to invest in our infrastructure to support a
growing company in an industry that requires a high level of
customer service and support. For the quarter, we saw net
charge-offs decrease to 7.8% from 8.3%. While it was nice to see
the decrease, we were disappointed that losses weren't even lower
as we were very optimistic heading into the 4th quarter. As Hank
mentioned, we can and must do much better job helping customers
succeed as this is what our Company has been built on. Our mission
is to earn repeat business and we can only do that if our customers
are successful," said Jeff Williams, Chief Financial Officer of
America's Car-Mart. "Because the competitive environment remains
challenging, we must always be on the top of our game especially as
related to collections. We are focused on the increase in our
accounts over 30 days past due at the end of the quarter and the
decrease in principal collected for the quarter. We are not happy
with where we are in these two areas and are working hard to help
our customers succeed."
"The debt to equity ratio was 44.8% and the debt to finance
receivables ratio was 24.6% at the end of the quarter. We
repurchased 121,025 shares of common stock during the quarter for
$6.4 million at an average cost per share of $52.81, and since
February 1, 2010, we have repurchased 3.7 million shares, or 31% of
our Company, for $120.7 million at an average cost per share of
$32.96. For the full fiscal year 2015, we opened seven new
dealerships and had net capital expenditures of $4.2 million, added
over 5,000 active accounts with receivables growth of $38.0 million
and re-purchased $20.0 million of common stock with only a $5.7
million increase in total debt. We will remain focused on watching
expenses and maximizing cash flows as we grow and we believe in the
long-term value of the Company," added Mr. Williams. "We will
always remain committed to striving to be the lowest cost provider
on both the financing side of the business and the dealership
side."
Conference Call
Management will be holding a conference call on Friday, May 22,
2015 at 11:00 a.m. Eastern Time to discuss fourth quarter results.
A live audio of the conference call will be accessible to the
public by calling (877) 776-4031. International callers dial (631)
291-4132. Callers should dial in approximately 10 minutes before
the call begins. A conference call replay will be available one
hour following the call for thirty days and can be accessed by
calling (855) 859-2056 (domestic) or (404) 537-3406
(international), conference call ID # 41809016.
About America's Car-Mart
America's Car-Mart, Inc. (the "Company") operates 141 automotive
dealerships in ten states and is one of the largest publicly held
automotive retailers in the United States focused exclusively on
the "Integrated Auto Sales and Finance" segment of the used car
market. The Company emphasizes superior customer service and the
building of strong personal relationships with its customers. The
Company operates its dealerships primarily in small cities
throughout the South-Central United States selling quality used
vehicles and providing financing for substantially all of its
customers. For more information, including investor
presentations, on America's Car-Mart, please visit our website at
www.car-mart.com.
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements address the Company's
future objectives, plans and goals, as well as the Company's
intent, beliefs and current expectations regarding future operating
performance and can generally be identified by words such as "may,"
"will," "should," "could," "believe," "expect," "anticipate,"
"intend," "plan," "foresee," and other similar words or
phrases. Specific events addressed by these forward-looking
statements include, but are not limited to:
- new dealership openings;
- performance of new dealerships;
- same store revenue growth;
- future overall revenue growth;
- the Company's collection results, including but not limited to
collections during income tax refund periods;
- repurchases of the Company's common stock; and
- the Company's business and growth strategies.
These forward-looking statements are based on the Company's
current estimates and assumptions and involve various risks and
uncertainties. As a result, you are cautioned that these
forward-looking statements are not guarantees of future
performance, and that actual results could differ materially from
those projected in these forward-looking statements. Factors
that may cause actual results to differ materially from the
Company's projections include, but are not limited to:
- the availability of credit facilities to support the Company's
business;
- the Company's ability to underwrite and collect its accounts
effectively, including but not limited to collections during income
tax refund periods;
- competition;
- dependence on existing management;
- availability of quality vehicles at prices that will be
affordable to customers;
- changes in financing laws or regulations; and
- general economic conditions in the markets in which the Company
operates, including but not limited to fluctuations in gas prices,
grocery prices and employment levels.
Additionally, risks and uncertainties that may affect future
results include those described from time to time in the Company's
SEC filings. The Company undertakes no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise. You are cautioned not
to place undue reliance on these forward-looking statements, which
speak only as of the dates on which they are made.
America's Car-Mart,
Inc. |
Consolidated Results of
Operations |
(Operating Statement Dollars in
Thousands) |
|
|
|
|
|
|
|
|
|
% Change |
As a % of
Sales |
|
Three Months Ended |
2015 |
Three Months Ended |
|
April 30, |
vs. |
April 30, |
|
2015 |
2014 |
2014 |
2015 |
2014 |
Operating Data: |
|
|
|
|
|
Retail units sold |
11,699 |
10,565 |
10.7% |
|
|
Average number of stores in
operation |
139 |
131 |
6.1 |
|
|
Average retail units sold per
store per month |
28.1 |
26.9 |
4.5 |
|
|
Average retail sales price |
$ 10,007 |
$ 9,785 |
2.3 |
|
|
Same store revenue growth |
7.5% |
(7.1)% |
|
|
|
Net charge-offs as a percent
of average Finance Receivables |
7.8% |
8.3% |
|
|
|
Collections as a percent of
average Finance Receivables |
16.7% |
17.5% |
|
|
|
Average percentage of Finance
Receivables-Current (excl. 1-2 day) |
76.6% |
78.9% |
|
|
|
Average down-payment
percentage |
9.0% |
9.7% |
|
|
|
|
|
|
|
|
|
Period End Data: |
|
|
|
|
|
Stores open |
141 |
134 |
5.2% |
|
|
Accounts over 30 days past
due |
5.8% |
4.4% |
|
|
|
Finance Receivables, gross |
$ 417,368 |
$ 379,332 |
10.0% |
|
|
|
|
|
|
|
|
Operating Statement: |
|
|
|
|
|
Revenues: |
|
|
|
|
|
Sales |
$ 123,269 |
$ 109,190 |
12.9% |
100.0% |
100.0% |
Interest income |
14,342 |
13,434 |
6.8 |
11.6 |
12.3 |
Total |
137,611 |
122,624 |
12.2 |
111.6 |
112.3 |
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
Cost of
sales |
72,147 |
63,782 |
13.1 |
58.5 |
58.4 |
Selling, general
and administrative |
21,187 |
19,546 |
8.4 |
17.2 |
17.9 |
Provision for
credit losses |
30,836 |
27,645 |
11.5 |
25.0 |
25.3 |
Interest
expense |
720 |
706 |
2.0 |
0.6 |
0.6 |
Depreciation and
amortization |
1,048 |
878 |
19.4 |
0.9 |
0.8 |
Loss on Disposal
of Property and Equipment |
(3) |
-- |
-- |
-- |
-- |
Total |
125,935 |
112,557 |
11.9 |
102.2 |
103.1 |
|
|
|
|
|
|
Income before
taxes |
11,676 |
10,067 |
|
9.5 |
9.2 |
|
|
|
|
|
|
Provision for income taxes |
4,426 |
3,754 |
|
3.6 |
3.4 |
|
|
|
|
|
|
Net income |
$ 7,250 |
$ 6,313 |
|
5.9 |
5.8 |
|
|
|
|
|
|
Dividends on subsidiary
preferred stock |
$ (10) |
$ (10) |
|
|
|
|
|
|
|
|
|
Net income attributable to
common shareholders |
$ 7,240 |
$ 6,303 |
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
Basic |
$ 0.85 |
$ 0.72 |
|
|
|
Diluted |
$ 0.81 |
$ 0.68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares
outstanding: |
|
|
|
|
|
Basic |
8,561,513 |
8,761,994 |
|
|
|
Diluted |
8,992,402 |
9,213,030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
America's Car-Mart,
Inc. |
Consolidated Results of
Operations |
(Operating Statement Dollars in
Thousands) |
|
|
|
|
|
|
|
|
|
% Change |
As a % of
Sales |
|
Years Ended |
2015 |
Years Ended |
|
April 30, |
vs. |
April 30, |
|
2015 |
2014 |
2014 |
2015 |
2014 |
Operating Data: |
|
|
|
|
|
Retail units sold |
46,760 |
42,551 |
9.9% |
|
|
Average number of stores in
operation |
137 |
128 |
7.0 |
|
|
Average retail units sold per
store per month |
28.4 |
27.7 |
2.5 |
|
|
Average retail sales price |
$ 9,680 |
$ 9,768 |
(0.9) |
|
|
Same store revenue growth |
2.9% |
(0.8)% |
|
|
|
Net charge-offs as a percent of
average Finance Receivables |
27.8% |
28.2% |
|
|
|
Collections as a percent of
average Finance Receivables |
58.7% |
58.0% |
|
|
|
Average percentage of Finance
Receivables-Current (excl. 1-2 day) |
79.9% |
80.1% |
|
|
|
Average down-payment
percentage |
6.9% |
6.6% |
|
|
|
|
|
|
|
|
|
Period End Data: |
|
|
|
|
|
Stores open |
141 |
134 |
5.2% |
|
|
Accounts over 30 days past
due |
5.8% |
4.4% |
|
|
|
Finance Receivables, gross |
$ 417,368 |
$ 379,332 |
10.0% |
|
|
|
|
|
|
|
|
Operating Statement: |
|
|
|
|
|
Revenues: |
|
|
|
|
|
Sales |
$ 472,569 |
$ 434,504 |
8.8% |
100.0% |
100.0% |
Interest
income |
57,752 |
54,683 |
5.6 |
12.2 |
12.6 |
Total |
530,321 |
489,187 |
8.4 |
112.2 |
112.6 |
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
Cost of
sales |
272,446 |
251,319 |
8.4 |
57.7 |
57.8 |
Selling, general
and administrative |
83,802 |
78,591 |
6.6 |
17.7 |
18.1 |
Provision for
credit losses |
120,289 |
119,247 |
0.9 |
25.5 |
27.4 |
Interest
expense |
2,903 |
2,997 |
(3.1) |
0.6 |
0.7 |
Depreciation and
amortization |
3,830 |
3,285 |
16.6 |
0.8 |
0.8 |
Loss on Disposal
of Property and Equipment |
17 |
76 |
(77.6) |
-- |
-- |
Total |
483,287 |
455,515 |
6.1 |
102.3 |
104.8 |
|
|
|
|
|
|
Income before taxes |
47,034 |
33,672 |
|
10.0 |
7.7 |
|
|
|
|
|
|
Provision for income taxes |
17,544 |
12,543 |
|
3.7 |
2.9 |
|
|
|
|
|
|
Net income |
$ 29,490 |
$ 21,129 |
|
6.2 |
4.9 |
|
|
|
|
|
|
Dividends on subsidiary
preferred stock |
$ (40) |
$ (40) |
|
|
|
|
|
|
|
|
|
Net income attributable to
common shareholders |
$ 29,450 |
$ 21,089 |
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
Basic |
$ 3.42 |
$ 2.36 |
|
|
|
Diluted |
$ 3.25 |
$ 2.25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares
outstanding: |
|
|
|
|
|
Basic |
8,617,864 |
8,930,592 |
|
|
|
Diluted |
9,048,957 |
9,391,667 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
America's Car-Mart,
Inc. |
Consolidated Balance
Sheet and Other Data |
(Dollars in
Thousands) |
|
|
April 30, |
April 30, |
|
2015 |
2014 |
|
|
|
Cash and cash equivalents |
$ 790 |
$ 289 |
Finance receivables, net |
$ 324,144 |
$ 293,299 |
Inventory |
$ 34,267 |
$ 30,115 |
Total assets |
$ 400,361 |
$ 363,297 |
Total debt |
$ 102,685 |
$ 97,032 |
Treasury stock |
$ 127,321 |
$ 107,301 |
Stockholders' equity |
$ 229,132 |
$ 213,006 |
Shares outstanding |
8,529,223 |
8,735,842 |
|
|
|
|
|
|
Finance receivables: |
|
|
Principal balance |
$ 417,368 |
$ 379,332 |
Deferred revenue - payment
protection plan |
(15,652) |
(13,233) |
Deferred revenue - service
contract |
(9,584) |
(4,234) |
Allowance for credit
losses |
(93,224) |
(86,033) |
|
|
|
Finance receivables, net of
allowance and deferred revenue |
$ 298,908 |
$ 275,832 |
|
|
|
|
|
|
Allowance as % of principal
balance net of deferred revenue |
23.8% |
23.8% (1) |
|
|
|
|
|
|
Changes in allowance for credit losses: |
|
|
|
Years Ended |
|
Ended April 30, |
|
2015 |
2014 |
Balance at beginning of
period |
$ 86,033 |
$ 75,345 |
Provision for credit
losses |
120,289 |
119,247 |
Charge-offs, net of collateral
recovered |
(113,098) |
(108,559) |
Balance at end of
period |
$ 93,224 |
$ 86,033 |
|
|
|
(1) The allowance as a percentage
of principal balance net of deferred revenue for April 30, 2014 has
been calculated net of deferred payment protection plan revenue and
deferred service contract revenue. Previously the deferred
service contract revenue was not included in this
calculation. The amount of the allowance for credit losses did
not change for April 30, 2014. |
CONTACT: William H. ("Hank") Henderson, CEO
at (479) 464-9944
or
Jeffrey A. Williams, CFO
at (479) 418-8021
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