America’s Car-Mart, Inc. (NASDAQ: CRMT) today announced its
operating results for the first quarter of fiscal year 2021.
“Once again, results were strong, and our
‘scoreboard’ is solid. We are certainly proud of the operating
success; however, we do not celebrate the scoreboard. We look
deeper at the quality of our daily work and how we can continue to
improve and fulfill our obligation to serve significantly more
customers into the future. While we are making good progress we
maintain a sense of urgency to quickly improve in all areas,” said
Jeff Williams, President and CEO. “We have a great team here at
America’s Car-Mart sharing a common goal of giving our
customers peace of mind with their local transportation needs by
keeping them on the road after the sale. How we conduct our
business has a direct effect on the quality of life and the overall
health of our communities, a responsibility we take to heart.
Through the continuing challenges related to the pandemic and
social unrest, we continue to focus on the health, safety, and
growth of our associates and how we can add value in the
communities we serve.
“We have stepped up and will continue to make a
positive difference by holding ourselves to a higher standard,
always moving our expectations up as we move forward,” added Mr.
Williams. “We have never been more certain of our purpose and our
place in the world and will continue to make investments in our
future with laser focus in the areas of recruiting, training and
retention of great associates. These investments include our new
Car-Mart University program, an enhanced customer experience with
emphasis on digital channels via our Customer Care Team, and better
inventory procurement as we leverage our scale and improve the
quality and consistency of the vehicles we sell.
“Our results were strong with top-line growth up
over 9%, net charge-offs down significantly and nice leveraging of
our selling, general and administrative costs. Our balance sheet is
in great shape and will allow for us to be nimble as we see
opportunities. We are very thankful to our associates for their
hard-work, dedication, and commitment to each other and to our
customers and our communities. Once, again, we have a great team
and we will be intentional about making a positive difference in
the world and growing our company in the right way,” said Mr.
Williams. “We opened two new dealerships during the quarter and
have two more in progress. We continue to grow our customer base
from our existing dealerships and believe we have significant
growth opportunities in towns we already serve. Additionally, we
believe that we will have acquisition opportunities as we move
forward. As always, our goal is to continue to grow at a rate at
which we can support our customers at the highest levels. Our
future is bright, and we are excited about our business as we look
forward.”
“Our overall revenue increase was driven by a
12.2% increase in the average retail sales price combined with a
$3.3 million increase in interest income. Our first quarter
sales volumes were impacted by reduced inventory levels,
especially at the lower price points, and lower customer traffic
both as a result of the pandemic, although volumes improved as we
moved through the quarter,” said Vickie Judy, Chief Financial
Officer. “We were able to take advantage of recent efforts by
rental car companies to reduce their fleets, allowing us to acquire
some newer model, lower mileage vehicles at affordable prices for
our customers. Net charge-offs for the quarter, as a
percentage of average finance receivables, were down to 4.8%,
positively impacted by the hard work of our associates to help
customers through this pandemic and by the additional CARES Act
enhanced unemployment payments. We saw leveraging with our selling,
general, and administrative expenses as we took steps to reduce
expenses early in the pandemic. All of our associates are
back to work full time, and we will continue to invest to build and
enhance our infrastructure to support a growing customer base.
“Our cash balance is $50.6 million and our debt,
net of cash, to finance receivable is 25.4%. During the
quarter, we added $22.2 million in receivables, funded $2.9 million
in net capital expenditures, and increased inventory by $19.8
million, with only a $7.7 million increase in debt, net of cash.
Our balance sheet is strong, and our vision is clear as we push for
market share increases by providing a great customer experience and
earning repeat business,” added Ms. Judy.
Conference Call
Management will be holding a conference call on
Tuesday, August 18, 2020 at 11:00 a.m. Eastern Time to discuss
first 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 two hours following the
call for thirty days and can be accessed by calling (855) 859-2056
(domestic) or (404) 537-3406 (international), conference call ID
#3239645.
About America's Car-Mart
America’s Car-Mart, Inc. operates automotive
dealerships in twelve 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
smaller cities throughout the South-Central United States selling
quality used vehicles and providing financing for substantially all
of its customers. For more information about America’s
Car-Mart, including investor presentations, please visit our
website at www.car-mart.com.
America’s Car-Mart was named to the Forbes
America’s Best Mid-Size Employers list for two consecutive years in
2019 and 2018 and has sold nearly 700,000 vehicles since fiscal
year 2000.
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 may include, but are not limited to:
- new dealership openings;
- performance of new dealerships;
- same dealership revenue growth;
- future revenue growth;
- receivables growth as related to revenue growth;
- gross profit per retail unit sold;
- interest rates;
- future credit losses;
- the Company’s collection results, including but not limited to
collections during income tax refund periods;
- seasonality; 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:
- business and economic disruptions and uncertainty resulting
from the COVID-19 pandemic and efforts to mitigate the financial
impact and health risks associated with the pandemic;
- 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;
- the availability of credit facilities to support the Company’s
business;
- the Company’s ability to underwrite and collect its contracts
effectively;
- competition;
- dependence on existing management;
- ability to attract, develop and retain qualified general
managers;
- availability of quality vehicles at prices that will be
affordable to customers;
- changes in consumer finance laws or regulations, including but
not limited to rules and regulations that have recently been
enacted or could be enacted by federal and state governments;
- security breaches, cyber-attacks, or fraudulent activity;
and
- the ability to successfully identify, complete and integrate
new acquisitions.
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.
____________________________Contacts:
Jeffrey A. Williams, President and CEO (479) 464-9944 or Vickie D.
Judy, CFO (479) 464-9944
|
|
|
|
|
|
|
|
|
% Change |
|
|
|
As a % of Sales |
|
Three Months Ended |
|
2020 |
|
|
|
Three Months Ended |
|
July 31, |
|
vs. |
|
|
|
July 31, |
|
2020 |
|
2019 |
|
2019 |
|
|
|
2020 |
|
2019 |
Operating Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail units sold |
|
12,176 |
|
|
|
12,523 |
|
|
(2.8 |
) |
% |
|
|
|
|
|
|
Average number of stores in operation |
|
148 |
|
|
|
144 |
|
|
2.8 |
|
|
|
|
|
|
|
|
Average retail units sold per store per month |
|
27.4 |
|
|
|
29.0 |
|
|
(5.5 |
) |
|
|
|
|
|
|
|
Average retail sales price |
$ |
12,800 |
|
|
$ |
11,410 |
|
|
12.2 |
|
|
|
|
|
|
|
|
Gross profit per retail unit |
$ |
5,579 |
|
|
$ |
4,886 |
|
|
14.2 |
|
|
|
|
|
|
|
|
Same store revenue growth |
|
5.5 |
% |
|
|
3.3 |
% |
|
|
|
|
|
|
|
|
|
|
Net charge-offs as a percent of average finance receivables |
|
4.8 |
% |
|
|
5.4 |
% |
|
|
|
|
|
|
|
|
|
|
Collections as a percent of average finance receivables |
|
13.0 |
% |
|
|
13.5 |
% |
|
|
|
|
|
|
|
|
|
|
Average percentage of finance receivables-current (excl. 1-2
day) |
|
84.8 |
% |
|
|
83.0 |
% |
|
|
|
|
|
|
|
|
|
|
Average down-payment percentage |
|
7.6 |
% |
|
|
6.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period End Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stores open |
|
150 |
|
|
|
145 |
|
|
3.4 |
|
% |
|
|
|
|
|
|
Accounts over 30 days past due |
|
2.6 |
% |
|
|
3.8 |
% |
|
|
|
|
|
|
|
|
|
|
Active customer count |
|
81,738 |
|
|
|
77,199 |
|
|
5.9 |
|
|
|
|
|
|
|
|
Finance receivables, gross |
$ |
643,335 |
|
|
$ |
561,104 |
|
|
14.7 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statements of Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
$ |
162,799 |
|
|
$ |
150,074 |
|
|
8.5 |
|
% |
|
100.0 |
% |
|
100.0 |
% |
Interest income |
|
25,112 |
|
|
|
21,804 |
|
|
15.2 |
|
|
|
15.4 |
|
|
14.5 |
|
Total |
|
187,911 |
|
|
|
171,878 |
|
|
9.3 |
|
|
|
115.4 |
|
|
114.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
94,874 |
|
|
|
88,885 |
|
|
6.7 |
|
|
|
58.3 |
|
|
59.2 |
|
Selling, general and administrative |
|
28,757 |
|
|
|
28,671 |
|
|
0.3 |
|
|
|
17.7 |
|
|
19.1 |
|
Provision for credit losses |
|
36,084 |
|
|
|
31,475 |
|
|
14.6 |
|
|
|
22.2 |
|
|
21.0 |
|
Interest expense |
|
1,719 |
|
|
|
2,004 |
|
|
(14.2 |
) |
|
|
1.1 |
|
|
1.3 |
|
Depreciation and amortization |
|
938 |
|
|
|
967 |
|
|
(3.0 |
) |
|
|
0.6 |
|
|
0.6 |
|
Loss on disposal of property and equipment |
|
- |
|
|
|
37 |
|
|
- |
|
|
|
- |
|
|
- |
|
Total |
|
162,372 |
|
|
|
152,039 |
|
|
6.8 |
|
|
|
99.7 |
|
|
101.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before taxes |
|
25,539 |
|
|
|
19,839 |
|
|
|
|
|
|
15.7 |
|
|
13.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
5,975 |
|
|
|
4,328 |
|
|
|
|
|
|
3.7 |
|
|
2.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
19,564 |
|
|
$ |
15,511 |
|
|
|
|
|
|
12.0 |
|
|
10.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends on subsidiary preferred stock |
$ |
(10 |
) |
|
$ |
(10 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to common shareholders |
$ |
19,554 |
|
|
$ |
15,501 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
2.95 |
|
|
$ |
2.32 |
|
|
|
|
|
|
|
|
|
|
|
Diluted |
$ |
2.83 |
|
|
$ |
2.21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares used in calculation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
6,632,445 |
|
|
|
6,684,282 |
|
|
|
|
|
|
|
|
|
|
|
Diluted |
|
6,915,596 |
|
|
|
7,016,752 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
July 31, |
|
April 30, |
|
July 31, |
|
2020 |
|
2020 |
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
50,618 |
|
|
$ |
59,560 |
|
|
$ |
1,640 |
|
Finance receivables, net |
$ |
482,528 |
|
|
$ |
466,141 |
|
|
$ |
431,610 |
|
Inventory |
$ |
56,220 |
|
|
$ |
36,414 |
|
|
$ |
44,651 |
|
Total assets |
$ |
698,988 |
|
|
$ |
667,324 |
|
|
$ |
548,779 |
|
Total debt |
$ |
214,283 |
|
|
$ |
215,568 |
|
|
$ |
158,677 |
|
Treasury stock |
$ |
246,911 |
|
|
$ |
246,911 |
|
|
$ |
235,617 |
|
Total equity |
$ |
325,849 |
|
|
$ |
302,759 |
|
|
$ |
273,036 |
|
Shares outstanding |
|
6,641,994 |
|
|
|
6,619,319 |
|
|
|
6,660,281 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance receivables: |
|
|
|
|
|
|
|
|
|
|
|
Principal balance |
$ |
643,335 |
|
|
$ |
621,182 |
|
|
$ |
561,104 |
|
Deferred revenue - payment protection plan |
|
(24,878 |
) |
|
|
(24,480 |
) |
|
|
(21,831 |
) |
Deferred revenue - service contract |
|
(11,637 |
) |
|
|
(11,641 |
) |
|
|
(10,727 |
) |
Allowance for credit losses |
|
(160,807 |
) |
|
|
(155,041 |
) |
|
|
(129,494 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Finance receivables, net of allowance and deferred revenue |
$ |
446,013 |
|
|
$ |
430,020 |
|
|
$ |
399,052 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance as % of principal balance net of deferred revenue |
|
26.5 |
% |
|
|
26.5 |
% |
|
|
24.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in allowance for credit losses: |
|
|
|
|
|
|
|
|
|
|
|
|
Three months Ended |
|
|
|
|
|
July 31, |
|
|
|
|
|
2020 |
|
2019 |
|
|
|
|
Balance at beginning of period |
$ |
155,041 |
|
|
$ |
127,842 |
|
|
|
|
|
Provision for credit losses |
|
36,084 |
|
|
|
31,475 |
|
|
|
|
|
Charge-offs, net of collateral recovered |
|
(30,318 |
) |
|
|
(29,823 |
) |
|
|
|
|
Balance at end of period |
$ |
160,807 |
|
|
$ |
129,494 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas Car Mart (NASDAQ:CRMT)
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