- Net income of $7.7 million and diluted
earnings per share of $0.76, inclusive of a $4.3 million, or $0.42
per share, impact due to hurricane events occurring in the third
quarter of 2024 -
- Record revenue and ending net receivables
driven by $46 million of sequential portfolio growth, an annualized
growth rate of 10% -
- Net credit loss rate of 10.6% and 30+ day
contractual delinquency rate of 6.9% as of September 30, 2024, both
40 basis points better than the prior-year period -
- Continued expense discipline with operating
expense increasing only 0.6% from the prior-year period and an
operating expense ratio of 13.9%, a 50 basis point improvement
year-over-year -
Regional Management Corp. (NYSE: RM), a diversified consumer
finance company, today announced results for the third quarter
ended September 30, 2024.
“Our team once again delivered strong results in the third
quarter, and our credit performance continues to improve,” said
Robert W. Beck, President and Chief Executive Officer of Regional
Management Corp. “We generated net income of $7.7 million and
diluted EPS of $0.76, inclusive of a $4.3 million impact to net
income from third quarter hurricane activity. On a pre-tax basis,
we reserved $2.1 million for incremental net credit losses and $3.5
million for estimated personal property insurance claims caused by
the hurricanes. While these charges created a drag on our third
quarter results, we are pleased to be able to provide our customers
with special borrower assistance programs and valuable personal
property insurance benefits that will help them rebuild their
lives.”
“Despite the hurricane challenges, we grew our portfolio by $46
million sequentially, or 2.6%, to $1.82 billion in the quarter, an
annualized growth rate of just above 10%,” added Mr. Beck. “Quality
portfolio growth drove our quarterly revenue to a record high of
$146 million, and we improved our interest and fee yield by 90
basis points year-over-year to 29.9%—the highest it has been in
over two years—from a combination of increased pricing, growth of
our higher-margin small loan portfolio, and improved credit
performance. Meanwhile, we kept a tight grip on G&A expense
while still investing in our growth and strategic initiatives. We
improved our operating expense ratio by 50 basis points from the
prior-year period to 13.9%, and year-over-year revenue growth
outpaced expense growth by 15 times.”
“Overall, our credit quality has improved and we have observed
positive trends in our credit metrics in recent quarters, as we
have maintained a tight credit box while also increasing the growth
of our higher-margin small loan portfolio,” continued Mr. Beck.
“Higher-quality originations in our front book continue to perform
in line with our expectations, make up a larger portion of our
portfolio, and are delivering at lower loss levels than our
stressed back book vintages. Looking ahead, we will continue to
monitor the economic environment, competitive dynamics, consumer
health, and other factors as we allocate capital to grow the
different pieces of our portfolio. Ultimately, we will build our
portfolio in a way that will generate strong margins that meet our
return hurdles and optimize short- and long-term results, while
also appropriately balancing credit outcomes and customer
needs.”
Third Quarter 2024 Highlights
- Net income for the third quarter of 2024 was $7.7 million and
diluted earnings per share was $0.76, inclusive of a $4.3 million,
or $0.42 per share, impact due to hurricanes occurring in the third
quarter of 2024.
- Net income also reflects the impact of $46.0 million of
sequential portfolio growth in the third quarter, which required a
$4.6 million provision for credit losses, or $3.5 million after
tax. The company is required to reserve for expected lifetime
credit losses at origination of each loan, while the revenue
benefits are recognized over the life of the loan, highlighting the
impact of portfolio growth on our income statement.
- Record net finance receivables as of September 30, 2024 of $1.8
billion, an increase of $68.7 million, or 3.9%, from the prior-year
period.
- Large loan net finance receivables of $1.3 billion increased
$21.5 million, or 1.7%, from the prior-year period and represented
71.1% of the total loan portfolio, compared to 72.6% in the
prior-year period.
- Small loan net finance receivables of $524.8 million increased
$50.6 million, or 10.7%, from the prior-year period and represented
28.8% of the total loan portfolio, compared to 27.1% in the
prior-year period.
- Net finance receivables with annual percentage rates (APRs)
above 36% increased to 17.8% of the portfolio from 14.9% in the
prior-year period, driven by the increase in the higher-margin
small loan portfolio.
- Customer accounts increased by 5.1% from the prior-year
period.
- Record total revenue for the third quarter of 2024 of $146.3
million, an increase of $5.5 million, or 3.9%, from the prior-year
period, primarily due to growth in average net finance receivables
and 90 basis points of higher interest and fee yield compared to
the prior-year period.
- The increase in interest and fee yield is attributable to
increased pricing, growth of the higher-margin small loan
portfolio, and improved credit performance.
- Large loan interest and fee yield increased by 40 basis points,
while the interest and fee yield of the higher-margin small loan
portfolio increased by 120 basis points.
- Total revenue yield decreased 10 basis points year-over-year
primarily due to $3.5 million, or 80 basis points, in increased
property insurance claims and reserves related to hurricanes
occurring during the third quarter of 2024.
- Provision for credit losses for the third quarter of 2024 was
$54.3 million, an increase of $3.4 million, or 6.7%, from the
prior-year period, inclusive of a $2.1 million incremental
provision for credit losses associated with third quarter hurricane
activity.
- Annualized net credit losses as a percentage of average net
finance receivables for the third quarter of 2024 were 10.6%, a 40
basis point improvement compared to 11.0% in the prior-year period.
The third quarter 2024 net credit loss rate is inclusive of an
estimated 30 basis point impact from year-over-year growth of the
higher-rate small loan portfolio.
- The provision for credit losses for the third quarter of 2024
included a reserve increase of $6.7 million, or $5.1 million after
tax, primarily related to portfolio growth ($4.6 million of
provision) and hurricanes ($2.1 million of provision) occurring
during the third quarter of 2024.
- Allowance for credit losses was $192.1 million as of September
30, 2024, or 10.6% of net finance receivables, a 10 basis point
increase sequentially from 10.5% due to 20 basis points of impact
for estimated credit losses related to hurricanes occurring during
the third quarter of 2024.
- As of September 30, 2024, 30+ day contractual delinquencies
totaled $126.0 million, or 6.9% of net finance receivables,
comparable sequentially and a 40 basis point improvement from
September 30, 2023. The third quarter 2024 delinquency rate is
inclusive of an estimated 20 basis point impact from year-over-year
growth of the higher-rate small loan portfolio and a 40 basis point
benefit from special borrower assistance programs offered to
customers impacted by the hurricanes.
- The delinquency rate of the large loan portfolio was 5.9% as of
the end of the third quarter of 2024, a 60 basis point improvement
from the prior-year period.
- The delinquency rate of the small loan portfolio was 9.4% as of
the end of the third quarter of 2024, a 20 basis point improvement
from the prior-year period.
- The third quarter 2024 delinquency rate for the small loan
portfolio is inclusive of a 30 basis point impact from the
year-over-year shift within the portfolio to higher-APR loans. The
current-quarter delinquency rates for the large and small loan
portfolios also each include 40 basis points of benefit from
special borrower assistance programs offered to customers impacted
by the hurricanes.
- General and administrative expenses for the third quarter of
2024 were $62.5 million, an increase of $0.4 million, or 0.6%, from
the prior-year period. The operating expense ratio (annualized
general and administrative expenses as a percentage of average net
finance receivables) for the third quarter of 2024 was 13.9%, a 50
basis point improvement from 14.4% in the prior-year period.
Fourth Quarter 2024 Dividend
The company’s Board of Directors has declared a dividend of
$0.30 per common share for the fourth quarter of 2024. The dividend
will be paid on December 11, 2024 to shareholders of record as of
the close of business on November 21, 2024. The declaration and
payment of any future dividend is subject to the discretion of the
Board of Directors and will depend on a variety of factors,
including the company’s financial condition and results of
operations.
Liquidity and Capital Resources
As of September 30, 2024, the company had net finance
receivables of $1.8 billion and debt of $1.4 billion. The debt
consisted of:
- $173.7 million on the company’s $355 million senior revolving
credit facility,
- $76.1 million on the company’s aggregate $375 million revolving
warehouse credit facilities, and
- $1.1 billion through the company’s asset-backed
securitizations.
As of September 30, 2024, the company’s unused capacity to fund
future growth on its revolving credit facilities (subject to the
borrowing base) was $482 million, or 66.1%, and the company had
available liquidity of $154.7 million, including unrestricted cash
on hand and immediate availability to draw down cash from its
revolving credit facilities. As of September 30, 2024, the
company’s fixed-rate debt as a percentage of total debt was 82%,
with a weighted-average coupon of 4.3% and a weighted-average
revolving duration of 1.1 years.
The company had a funded debt-to-equity ratio of 4.0 to 1.0 and
a stockholders’ equity ratio of 19.4%, each as of September 30,
2024. On a non-GAAP basis, the company had a funded
debt-to-tangible equity ratio of 4.2 to 1.0, as of September 30,
2024. Please refer to the reconciliations of non-GAAP measures to
comparable GAAP measures included at the end of this press
release.
Conference Call Information
Regional Management Corp. will host a conference call and
webcast today at 5:00 PM ET to discuss these results.
The dial-in number for the conference call is (855) 327-6837
(toll-free) or (631) 891-4304 (direct). Please dial the number 10
minutes prior to the scheduled start time.
*** A supplemental slide presentation will be made available
on Regional’s website prior to the earnings call at
www.RegionalManagement.com. ***
In addition, a live webcast of the conference call will be
available on Regional’s website at www.RegionalManagement.com.
A webcast replay of the call will be available at
www.RegionalManagement.com for one year following the call.
About Regional Management Corp.
Regional Management Corp. (NYSE: RM) is a diversified consumer
finance company that provides attractive, easy-to-understand
installment loan products primarily to customers with limited
access to consumer credit from banks, thrifts, credit card
companies, and other lenders. Regional Management operates under
the name “Regional Finance” online and in branch locations in 19
states across the United States. Most of its loan products are
secured, and each is structured on a fixed-rate, fixed-term basis
with fully amortizing equal monthly installment payments, repayable
at any time without penalty. Regional Management sources loans
through its multiple channel platform, which includes branches,
centrally managed direct mail campaigns, digital partners, and its
consumer website. For more information, please visit
www.RegionalManagement.com.
Forward-Looking Statements
This press release may contain various “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements are not statements
of historical fact but instead represent Regional Management
Corp.’s expectations or beliefs concerning future events.
Forward-looking statements include, without limitation, statements
concerning financial outlooks or future plans, objectives, goals,
projections, strategies, events, or performance, and underlying
assumptions and other statements related thereto. Words such as
“may,” “will,” “should,” “likely,” “anticipates,” “expects,”
“intends,” “plans,” “projects,” “believes,” “estimates,” “outlook,”
and similar expressions may be used to identify these
forward-looking statements. Such forward-looking statements speak
only as of the date on which they were made and are about matters
that are inherently subject to risks and uncertainties, many of
which are outside of the control of Regional Management. As a
result, actual performance and results may differ materially from
those contemplated by these forward-looking statements. Therefore,
investors should not place undue reliance on forward-looking
statements.
Factors that could cause actual results or performance to differ
from the expectations expressed or implied in forward-looking
statements include, but are not limited to, the following: managing
growth effectively, implementing Regional Management’s growth
strategy, and opening new branches as planned; Regional
Management’s convenience check strategy; Regional Management’s
policies and procedures for underwriting, processing, and servicing
loans; Regional Management’s ability to collect on its loan
portfolio; Regional Management’s insurance operations; exposure to
credit risk and repayment risk, which risks may increase in light
of adverse or recessionary economic conditions; the implementation
of evolving underwriting models and processes, including as to the
effectiveness of Regional Management's custom scorecards; changes
in the competitive environment in which Regional Management
operates or a decrease in the demand for its products; the
geographic concentration of Regional Management’s loan portfolio;
the failure of third-party service providers, including those
providing information technology products; changes in economic
conditions in the markets Regional Management serves, including
levels of unemployment and bankruptcies; the ability to achieve
successful acquisitions and strategic alliances; the ability to
make technological improvements as quickly as competitors; security
breaches, cyber-attacks, failures in information systems, or
fraudulent activity; the ability to originate loans; reliance on
information technology resources and providers, including the risk
of prolonged system outages; changes in current revenue and expense
trends, including trends affecting delinquencies and credit losses;
any future public health crises, including the impact of such
crisis on our operations and financial condition; changes in
operating and administrative expenses; the departure, transition,
or replacement of key personnel; the ability to timely and
effectively implement, transition to, and maintain the necessary
information technology systems, infrastructure, processes, and
controls to support Regional Management’s operations and
initiatives; changes in interest rates; existing sources of
liquidity may become insufficient or access to these sources may
become unexpectedly restricted; exposure to financial risk due to
asset-backed securitization transactions; risks related to
regulation and legal proceedings, including changes in laws or
regulations or in the interpretation or enforcement of laws or
regulations; changes in accounting standards, rules, and
interpretations and the failure of related assumptions and
estimates; the impact of changes in tax laws and guidance,
including the timing and amount of revenues that may be recognized;
risks related to the ownership of Regional Management’s common
stock, including volatility in the market price of shares of
Regional Management’s common stock; the timing and amount of future
cash dividend payments; and anti-takeover provisions in Regional
Management’s charter documents and applicable state law.
The foregoing factors and others are discussed in greater detail
in Regional Management’s filings with the Securities and Exchange
Commission. Regional Management will not update or revise
forward-looking statements to reflect events or circumstances after
the date of this press release or to reflect the occurrence of
unanticipated events or the non-occurrence of anticipated events,
whether as a result of new information, future developments, or
otherwise, except as required by law. Regional Management is not
responsible for changes made to this document by wire services or
Internet services.
Regional Management Corp. and
Subsidiaries
Consolidated Statements of
Income
(Unaudited)
(dollars in thousands, except
per share amounts)
Better (Worse)
Better (Worse)
3Q 24
3Q 23
$
%
YTD 24
YTD 23
$
%
Revenue
Interest and fee income
$
133,932
$
125,018
$
8,914
7.1
%
$
390,648
$
363,508
$
27,140
7.5
%
Insurance income, net
7,422
11,382
(3,960
)
(34.8
)%
28,903
33,544
(4,641
)
(13.8
)%
Other income
4,984
4,478
506
11.3
%
14,120
12,688
1,432
11.3
%
Total revenue
146,338
140,878
5,460
3.9
%
433,671
409,740
23,931
5.8
%
Expenses
Provision for credit losses
54,349
50,930
(3,419
)
(6.7
)%
154,574
151,149
(3,425
)
(2.3
)%
Personnel
38,323
39,832
1,509
3.8
%
113,240
114,848
1,608
1.4
%
Occupancy
6,551
6,315
(236
)
(3.7
)%
19,075
18,761
(314
)
(1.7
)%
Marketing
5,078
4,077
(1,001
)
(24.6
)%
14,229
11,300
(2,929
)
(25.9
)%
Other
12,516
11,880
(636
)
(5.4
)%
36,508
33,414
(3,094
)
(9.3
)%
Total general and administrative
62,468
62,104
(364
)
(0.6
)%
183,052
178,323
(4,729
)
(2.7
)%
Interest expense
19,356
16,947
(2,409
)
(14.2
)%
54,725
49,953
(4,772
)
(9.6
)%
Income before income taxes
10,165
10,897
(732
)
(6.7
)%
41,320
30,315
11,005
36.3
%
Income taxes
2,502
2,077
(425
)
(20.5
)%
10,007
6,783
(3,224
)
(47.5
)%
Net income
$
7,663
$
8,820
$
(1,157
)
(13.1
)%
$
31,313
$
23,532
$
7,781
33.1
%
Net income per common share:
Basic
$
0.79
$
0.94
$
(0.15
)
(16.0
)%
$
3.25
$
2.51
$
0.74
29.5
%
Diluted
$
0.76
$
0.91
$
(0.15
)
(16.5
)%
$
3.16
$
2.45
$
0.71
29.0
%
Weighted-average common shares
outstanding:
Basic
9,683
9,429
(254
)
(2.7
)%
9,622
9,385
(237
)
(2.5
)%
Diluted
10,090
9,650
(440
)
(4.6
)%
9,900
9,613
(287
)
(3.0
)%
Return on average assets (annualized)
1.7
%
2.0
%
2.3
%
1.8
%
Return on average equity (annualized)
8.7
%
10.8
%
12.3
%
9.8
%
Regional Management Corp. and
Subsidiaries
Consolidated Balance
Sheets
(Unaudited)
(dollars in thousands, except
par value amounts)
Increase (Decrease)
3Q 24
3Q 23
$
%
Assets
Cash
$
4,745
$
7,413
$
(2,668
)
(36.0
)%
Net finance receivables
1,819,756
1,751,009
68,747
3.9
%
Unearned insurance premiums
(46,508
)
(48,764
)
2,256
4.6
%
Allowance for credit losses
(192,100
)
(184,900
)
(7,200
)
(3.9
)%
Net finance receivables, less unearned
insurance premiums and allowance for credit losses
1,581,148
1,517,345
63,803
4.2
%
Restricted cash
115,576
117,029
(1,453
)
(1.2
)%
Lease assets
37,229
34,864
2,365
6.8
%
Intangible assets
22,250
15,048
7,202
47.9
%
Restricted available-for-sale
investments
21,727
22,510
(783
)
(3.5
)%
Property and equipment
13,425
14,157
(732
)
(5.2
)%
Deferred tax assets, net
11,833
14,140
(2,307
)
(16.3
)%
Other assets
13,898
22,834
(8,936
)
(39.1
)%
Total assets
$
1,821,831
$
1,765,340
$
56,491
3.2
%
Liabilities and Stockholders’
Equity
Liabilities:
Debt
$
1,395,892
$
1,372,748
$
23,144
1.7
%
Unamortized debt issuance costs
(4,645
)
(5,647
)
1,002
17.7
%
Net debt
1,391,247
1,367,101
24,146
1.8
%
Lease liabilities
39,350
37,095
2,255
6.1
%
Accounts payable and accrued expenses
38,306
30,559
7,747
25.4
%
Total liabilities
1,468,903
1,434,755
34,148
2.4
%
Stockholders’ equity:
Preferred stock ($0.10 par value, 100,000
shares authorized, none issued or outstanding)
—
—
—
—
Common stock ($0.10 par value, 1,000,000
shares authorized, 14,971 shares issued and 10,164 shares
outstanding at September 30, 2024 and 14,642 shares issued and
9,835 shares outstanding at September 30, 2023)
1,497
1,464
33
2.3
%
Additional paid-in capital
129,936
119,507
10,429
8.7
%
Retained earnings
371,725
360,155
11,570
3.2
%
Accumulated other comprehensive loss
(87
)
(398
)
311
78.1
%
Treasury stock (4,807 shares at September
30, 2024 and September 30, 2023)
(150,143
)
(150,143
)
—
—
Total stockholders’ equity
352,928
330,585
22,343
6.8
%
Total liabilities and stockholders’
equity
$
1,821,831
$
1,765,340
$
56,491
3.2
%
Regional Management Corp. and
Subsidiaries
Selected Financial
Data
(Unaudited)
(dollars in thousands, except
per share amounts)
Net Finance
Receivables
3Q 24
2Q 24
QoQ $ Inc (Dec)
QoQ % Inc (Dec)
3Q 23
YoY $ Inc (Dec)
YoY % Inc (Dec)
Large loans
$
1,293,410
$
1,266,032
$
27,378
2.2
%
$
1,271,891
$
21,519
1.7
%
Small loans
524,826
505,640
19,186
3.8
%
474,181
50,645
10.7
%
Retail loans
1,520
2,071
(551
)
(26.6
)%
4,937
(3,417
)
(69.2
)%
Total net finance receivables
$
1,819,756
$
1,773,743
$
46,013
2.6
%
$
1,751,009
$
68,747
3.9
%
Number of branches at period end
340
343
(3
)
(0.9
)%
347
(7
)
(2.0
)%
Net finance receivables per branch
$
5,352
$
5,171
$
181
3.5
%
$
5,046
$
306
6.1
%
Averages and Yields
3Q 24
2Q 24
3Q 23
Average Net Finance
Receivables
Average Yield (1)
Average Net Finance
Receivables
Average Yield (1)
Average Net Finance
Receivables
Average Yield (1)
Large loans
$
1,279,720
26.7
%
$
1,255,729
26.1
%
$
1,257,168
26.3
%
Small loans
511,294
37.8
%
490,615
37.3
%
459,320
36.6
%
Retail loans
1,795
16.3
%
2,433
16.6
%
5,647
16.9
%
Total interest and fee yield
$
1,792,809
29.9
%
$
1,748,777
29.3
%
$
1,722,135
29.0
%
Total revenue yield
$
1,792,809
32.6
%
$
1,748,777
32.7
%
$
1,722,135
32.7
%
(1) Annualized interest and fee income as a percentage of
average net finance receivables.
Components of Increase in
Interest and Fee Income
3Q 24 Compared to 3Q
23
Increase (Decrease)
Volume
Rate
Volume & Rate
Total
Large loans
$
1,484
$
1,246
$
23
$
2,753
Small loans
4,757
1,410
159
6,326
Retail loans
(162
)
(8
)
5
(165
)
Product mix
(948
)
986
(38
)
—
Total increase in interest and fee
income
$
5,131
$
3,634
$
149
$
8,914
Loans Originated (1)
3Q 24
2Q 24
QoQ $ Inc (Dec)
QoQ % Inc (Dec)
3Q 23
YoY $ Inc (Dec)
YoY % Inc (Dec)
Large loans
$
251,563
$
254,779
$
(3,216
)
(1.3
)%
$
251,999
$
(436
)
(0.2
)%
Small loans
174,632
171,282
3,350
2.0
%
173,074
1,558
0.9
%
Total loans originated
$
426,195
$
426,061
$
134
—
$
425,073
$
1,122
0.3
%
(1) Represents the principal balance of loan originations and
refinancings.
Other Key Metrics
3Q 24
2Q 24
3Q 23
Net credit losses
$
47,649
$
55,502
$
47,430
Percentage of average net finance
receivables (annualized)
10.6
%
12.7
%
11.0
%
Provision for credit losses
$
54,349
$
53,802
$
50,930
Percentage of average net finance
receivables (annualized)
12.1
%
12.3
%
11.8
%
Percentage of total revenue
37.1
%
37.6
%
36.2
%
General and administrative expenses
$
62,468
$
60,136
$
62,104
Percentage of average net finance
receivables (annualized)
13.9
%
13.8
%
14.4
%
Percentage of total revenue
42.7
%
42.0
%
44.1
%
Same store results (1):
Net finance receivables at period-end
$
1,815,187
$
1,759,075
$
1,684,757
Net finance receivable growth rate
3.7
%
4.5
%
4.9
%
Number of branches in calculation
337
338
330
(1) Same store sales reflect the change in year-over-year sales
for the comparable branch base. The comparable branch base includes
those branches open for at least one year.
Contractual
Delinquency
3Q 24
2Q 24
3Q 23
Allowance for credit losses
$
192,100
10.6
%
$
185,400
10.5
%
$
184,900
10.6
%
Current
1,529,171
84.1
%
1,497,219
84.4
%
1,472,931
84.2
%
1 to 29 days past due
164,568
9.0
%
153,788
8.7
%
149,648
8.5
%
Delinquent accounts:
30 to 59 days
35,300
1.9
%
34,924
1.9
%
36,502
2.1
%
60 to 89 days
27,704
1.5
%
27,689
1.6
%
28,130
1.6
%
90 to 119 days
23,964
1.4
%
21,607
1.2
%
23,420
1.3
%
120 to 149 days
22,544
1.2
%
19,333
1.1
%
21,309
1.2
%
150 to 179 days
16,505
0.9
%
19,183
1.1
%
19,069
1.1
%
Total contractual delinquency
$
126,017
6.9
%
$
122,736
6.9
%
$
128,430
7.3
%
Total net finance receivables
$
1,819,756
100.0
%
$
1,773,743
100.0
%
$
1,751,009
100.0
%
1 day and over past due
$
290,585
15.9
%
$
276,524
15.6
%
$
278,078
15.8
%
Contractual Delinquency by
Product
3Q 24
2Q 24
3Q 23
Large loans
$
76,435
5.9
%
$
76,432
6.0
%
$
82,256
6.5
%
Small loans
49,351
9.4
%
46,015
9.1
%
45,438
9.6
%
Retail loans
231
15.2
%
289
14.0
%
736
14.9
%
Total contractual delinquency
$
126,017
6.9
%
$
122,736
6.9
%
$
128,430
7.3
%
Income Statement Quarterly
Trend
3Q 23
4Q 23
1Q 24
2Q 24
3Q 24
QoQ $ B(W)
YoY $ B(W)
Revenue
Interest and fee income
$
125,018
$
126,190
$
128,818
$
127,898
$
133,932
$
6,034
$
8,914
Insurance income, net
11,382
10,985
10,974
10,507
7,422
(3,085
)
(3,960
)
Other income
4,478
4,484
4,516
4,620
4,984
364
506
Total revenue
140,878
141,659
144,308
143,025
146,338
3,313
5,460
Expenses
Provision for credit losses
50,930
68,885
46,423
53,802
54,349
(547
)
(3,419
)
Personnel
39,832
42,024
37,820
37,097
38,323
(1,226
)
1,509
Occupancy
6,315
6,268
6,375
6,149
6,551
(402
)
(236
)
Marketing
4,077
4,474
4,315
4,836
5,078
(242
)
(1,001
)
Other
11,880
12,030
11,938
12,054
12,516
(462
)
(636
)
Total general and administrative
62,104
64,796
60,448
60,136
62,468
(2,332
)
(364
)
Interest expense
16,947
17,510
17,504
17,865
19,356
(1,491
)
(2,409
)
Income (loss) before income taxes
10,897
(9,532
)
19,933
11,222
10,165
(1,057
)
(732
)
Income taxes
2,077
(1,958
)
4,728
2,777
2,502
275
(425
)
Net income (loss)
$
8,820
$
(7,574
)
$
15,205
$
8,445
$
7,663
$
(782
)
$
(1,157
)
Net income (loss) per common share:
Basic
$
0.94
$
(0.80
)
$
1.59
$
0.88
$
0.79
$
(0.09
)
$
(0.15
)
Diluted
$
0.91
$
(0.80
)
$
1.56
$
0.86
$
0.76
$
(0.10
)
$
(0.15
)
Weighted-average shares outstanding:
Basic
9,429
9,437
9,569
9,613
9,683
(70
)
(254
)
Diluted
9,650
9,437
9,746
9,863
10,090
(227
)
(440
)
Balance Sheet Quarterly
Trend
3Q 23
4Q 23
1Q 24
2Q 24
3Q 24
QoQ $ Inc (Dec)
YoY $ Inc (Dec)
Total assets
$
1,765,340
$
1,794,527
$
1,756,748
$
1,789,052
$
1,821,831
$
32,779
$
56,491
Net finance receivables
$
1,751,009
$
1,771,410
$
1,744,286
$
1,773,743
$
1,819,756
$
46,013
$
68,747
Allowance for credit losses
$
184,900
$
187,400
$
187,100
$
185,400
$
192,100
$
6,700
$
7,200
Debt
$
1,372,748
$
1,399,814
$
1,358,795
$
1,378,449
$
1,395,892
$
17,443
$
23,144
Other Key Metrics Quarterly
Trend
3Q 23
4Q 23
1Q 24
2Q 24
3Q 24
QoQ Inc (Dec)
YoY Inc (Dec)
Interest and fee yield (annualized)
29.0
%
28.8
%
29.3
%
29.3
%
29.9
%
0.6
%
0.9
%
Efficiency ratio (1)
44.1
%
45.7
%
41.9
%
42.0
%
42.7
%
0.7
%
(1.4
)%
Operating expense ratio (2)
14.4
%
14.8
%
13.7
%
13.8
%
13.9
%
0.1
%
(0.5
)%
30+ contractual delinquency
7.3
%
6.9
%
7.1
%
6.9
%
6.9
%
—
(0.4
)%
Net credit loss ratio (3)
11.0
%
15.1
%
10.6
%
12.7
%
10.6
%
(2.1
)%
(0.4
)%
Book value per share
$
33.61
$
33.02
$
34.10
$
33.96
$
34.72
$
0.76
$
1.11
(1) General and administrative expenses as a percentage of total
revenue. (2) Annualized general and administrative expenses as a
percentage of average net finance receivables. (3) Annualized net
credit losses as a percentage of average net finance
receivables.
Averages and Yields
YTD 24
YTD 23
Average Net Finance
Receivables
Average Yield (1)
Average Net Finance
Receivables
Average Yield (1)
Large loans
$
1,266,363
26.3
%
$
1,232,170
26.1
%
Small loans
497,987
37.7
%
456,893
35.4
%
Retail loans
2,521
16.2
%
7,252
17.5
%
Total interest and fee yield
$
1,766,871
29.5
%
$
1,696,315
28.6
%
Total revenue yield
$
1,766,871
32.7
%
$
1,696,315
32.2
%
Components of Increase in
Interest and Fee Income
YTD 24 Compared to YTD
23
Increase (Decrease)
Volume
Rate
Volume & Rate
Total
Large loans
$
6,695
$
1,651
$
46
$
8,392
Small loans
10,910
7,784
700
19,394
Retail loans
(621
)
(72
)
47
(646
)
Product mix
(1,864
)
2,177
(313
)
—
Total increase in interest and fee
income
$
15,120
$
11,540
$
480
$
27,140
Loans Originated (1)
YTD 24
YTD 23
YTD $ Inc (Dec)
YTD % Inc (Dec)
Large loans
$
691,416
$
695,084
$
(3,668
)
(0.5
)%
Small loans
487,195
432,018
55,177
12.8
%
Retail loans
—
146
(146
)
(100.0
)%
Total loans originated
$
1,178,611
$
1,127,248
$
51,363
4.6
%
(1) Represents the principal balance of loan originations and
refinancings.
Other Key Metrics
YTD 24
YTD 23
Net credit losses
$
149,874
$
145,049
Percentage of average net finance
receivables (annualized)
11.3
%
11.4
%
Provision for credit losses
$
154,574
$
151,149
Percentage of average net finance
receivables (annualized)
11.7
%
11.9
%
Percentage of total revenue
35.6
%
36.9
%
General and administrative expenses
$
183,052
$
178,323
Percentage of average net finance
receivables (annualized)
13.8
%
14.0
%
Percentage of total revenue
42.2
%
43.5
%
Non-GAAP Financial Measures
In addition to financial measures presented in accordance with
generally accepted accounting principles (“GAAP”), this press
release contains certain non-GAAP financial measures. The company’s
management utilizes non-GAAP measures as additional metrics to aid
in, and enhance, its understanding of the company’s financial
results. Tangible equity and the funded debt-to-tangible equity
ratio are non-GAAP measures that adjust GAAP measures to exclude
intangible assets. Management uses these equity measures to
evaluate and manage the company’s capital and leverage position.
The company also believes that these equity measures are commonly
used in the financial services industry and provide useful
information to users of the company’s financial statements in the
evaluation of its capital and leverage position.
This non-GAAP financial information should be considered in
addition to, not as a substitute for or superior to, measures of
financial performance prepared in accordance with GAAP. In
addition, the company’s non-GAAP measures may not be comparable to
similarly titled non-GAAP measures of other companies. The
following tables provide a reconciliation of GAAP measures to
non-GAAP measures.
3Q 24
Debt
$
1,395,892
Total stockholders' equity
352,928
Less: Intangible assets
22,250
Tangible equity (non-GAAP)
$
330,678
Funded debt-to-equity ratio
4.0
x
Funded debt-to-tangible equity ratio
(non-GAAP)
4.2
x
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241106633278/en/
Investor Relations Garrett Edson, (203) 682-8331
investor.relations@regionalmanagement.com
Regional Management (NYSE:RM)
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