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CPS Announces Third Quarter 2024 Earnings
Source: Nasdaq GlobeNewswire / 31 Oct 2024 16:30:58 America/New_York
- Revenues of $100.6 million compared to $92.1 million in the prior year period
- Net income of $4.8 million, or $0.20 per diluted share
- Total portfolio balance of $3.330 billion, highest in company history
- New contract purchases of $445.9 million, compared to $322.4 million in the prior year period
LAS VEGAS, NV, Oct. 31, 2024 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) today announced earnings of $4.8 million, or $0.20 per diluted share, for its third quarter ended September 30, 2024.
Revenues for the third quarter of 2024 were $100.6 million, an increase of $8.5 million, or 9.2%, compared to $92.1 million for the third quarter of 2023. Total operating expenses for the third quarter of 2024 were $93.7 million compared to $77.9 million for the 2023 period. Pretax income for the third quarter of 2024 was $6.9 million compared to pretax income of $14.2 million in the third quarter of 2023.
For the nine months ended September 30, 2024 total revenues were $288.2 million compared to $260.0 million for the nine months ended September 30, 2023, an increase of approximately $28.2 million, or 10.8%. Total operating expenses for the nine months ended September 30, 2024 were $268.1 million, compared to $208.8 million for the nine months ended September 30, 2023. Pretax income for the nine months ended September 30, 2024 was $20.1 million, compared to $51.3 million for the nine months ended September 30, 2023. Net income for the nine months ended September 30, 2024 was $14.1 million compared to $38.2 million for the nine months ended September 30, 2023.
During the third quarter of 2024, CPS purchased $445.9 million of new contracts compared to $431.9 million during the second quarter of 2024 and $322.4 million during the third quarter of 2023. The Company's receivables totaled $3.330 billion as of September 30, 2024, an increase from $3.173 billion as of June 30, 2024 and an increase from $2.943 billion as of September 30, 2023.
Annualized net charge-offs for the third quarter of 2024 were 7.32% of the average portfolio as compared to 6.86% for the third quarter of 2023. Delinquencies greater than 30 days (including repossession inventory) were 14.04% of the total portfolio as of September 30, 2024, compared to 13.31% as of September 30, 2023.
“New loan origination volumes have outpaced the prior quarter for a fourth consecutive quarter. This positions us well for future quarters,” said Charles E. Bradley Jr., Chief Executive Officer. “With our operating efficiencies improving, we remain committed to driving the company forward in any environment.”
Conference Call
CPS announced that it will hold a conference call on November 1, 2024 at 1:00 p.m. ET to discuss its third quarter 2024 operating results.
Those wishing to participate can pre-register for the conference call at the following link https://register.vevent.com/register/BIaadcdbbe0a7849aa918eac85c86475ff. Registered participants will receive an email containing conference call details for dial-in options. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the schedule start time. A replay will be available beginning two hours after conclusion of the call for 12 months via the Company’s website at https://ir.consumerportfolio.com/investor-relations.
About Consumer Portfolio Services, Inc.
Consumer Portfolio Services, Inc. is an independent specialty finance company that provides indirect automobile financing to individuals with past credit problems or limited credit histories. We purchase retail installment sales contracts primarily from franchised automobile dealerships secured by late model used vehicles and, to a lesser extent, new vehicles. We fund these contract purchases on a long-term basis primarily through the securitization markets and service the contracts over their lives.
Forward-looking statements in this news release include the Company's recorded figures representing allowances for remaining expected lifetime credit losses, its estimates of fair value (most significantly for its receivables accounted for at fair value), its provision for credit losses, its entries offsetting the preceding, and figures derived from any of the preceding. In each case, such figures are forward-looking statements because they are dependent on the Company’s estimates of losses to be incurred in the future. The accuracy of such estimates may be adversely affected by various factors, which include the following: possible increased delinquencies; repossessions and losses on retail installment contracts; incorrect prepayment speed and/or discount rate assumptions; possible unavailability of qualified personnel, which could adversely affect the Company’s ability to service its portfolio; possible increases in the rate of consumer bankruptcy filings, which could adversely affect the Company’s rights to collect payments from its portfolio; other changes in government regulations affecting consumer credit; possible declines in the market price for used vehicles, which could adversely affect the Company’s realization upon repossessed vehicles; and economic conditions in geographic areas in which the Company's business is concentrated. Any or all of such factors also may affect the Company’s future financial results, as to which there can be no assurance. Any implication that the results of the most recently completed quarter are indicative of future results is disclaimed, and the reader should draw no such inference. Factors such as those identified above in relation to losses to be incurred in the future may affect future performance.
Investor Relations Contact
Danny Bharwani, Chief Financial Officer
949-753-6811
Consumer Portfolio Services, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three months ended Nine months ended September 30, September 30, 2024 2023 2024 2023 Revenues: Interest income $ 93,158 $ 83,261 $ 265,812 $ 245,960 Mark to finance receivables measured at fair value 5,500 6,000 16,000 6,000 Other income 1,922 2,818 6,391 8,077 100,580 92,079 288,203 260,037 Expenses: Employee costs 24,162 21,812 72,303 64,991 General and administrative 13,276 13,045 40,288 36,224 Interest 50,056 37,889 138,735 106,354 Provision for credit losses (994 ) (2,000 ) (4,579 ) (20,700 ) Other expenses 7,229 7,115 21,376 21,915 93,729 77,861 268,123 208,784 Income before income taxes 6,851 14,218 20,080 51,253 Income tax expense 2,055 3,839 6,022 13,097 Net income $ 4,796 $ 10,379 $ 14,058 $ 38,156 Earnings per share: Basic $ 0.22 $ 0.49 $ 0.66 $ 1.83 Diluted $ 0.20 $ 0.41 $ 0.58 $ 1.51 Number of shares used in computing earnings per share: Basic 21,343 21,154 21,250 20,815 Diluted 24,153 25,218 24,340 25,331 Condensed Consolidated Balance Sheets (In thousands) (Unaudited) September 30, December 31, 2024 2023 Assets: Cash and cash equivalents $ 8,071 $ 6,174 Restricted cash and equivalents 270,981 119,257 Finance receivables measured at fair value 3,132,310 2,722,662 Finance receivables 8,274 27,553 Allowance for finance credit losses -486 -2,869 Finance receivables, net 7,788 24,684 Deferred tax assets, net 1,565 3,736 Other assets 41,977 27,233 $ 3,462,692 $ 2,903,746 Liabilities and Shareholders' Equity: Accounts payable and accrued expenses $ 72,626 $ 62,544 Warehouse lines of credit 105,783 234,025 Residual interest financing 99,127 49,875 Securitization trust debt 2,875,777 2,265,446 Subordinated renewable notes 24,288 17,188 3,177,601 2,629,078 Shareholders' equity 285,091 274,668 $ 3,462,692 $ 2,903,746 Operating and Performance Data ($ in millions) At and for the At and for the Three months ended Nine months ended September 30, September 30, 2024 2023 2024 2023 Contracts purchased $ 445.95 $ 322.42 $ 1,224.13 $ 1,055.96 Contracts securitized $ 298.42 $ 312.68 1,256.13 1,045.42 Total portfolio balance (1) $ 3,329.84 $ 2,943.33 $ 3,329.84 $ 2,943.33 Average portfolio balance (1) $ 3,278.34 $ 2,934.75 3,131.48 2,898.44 Delinquencies (1) 31+ Days 11.25 % 11.74 % Repossession Inventory 2.79 % 1.57 % Total Delinquencies and Repo. Inventory 14.04 % 13.31 % Annualized Net Charge-offs as % of Average Portfolio (1) 7.32 % 6.86 % 7.47 % 6.12 % Recovery rates (1), (2) 29.1 % 37.8 % 31.1 % 41.1 % For the For the Three months ended Nine months ended September 30, September 30, 2024 2023 2024 2023 $ (3) % (4) $ (3) % (4) $ (3) % (4) $ (3) % (4) Interest income $ 93.16 11.4 % $ 83.26 11.3 % $ 265.81 11.3 % $ 245.96 11.3 % Mark to finance receivables measured at fair value 5.50 0.7 % 6.00 0.8 % 16.00 0.7 % 6.00 0.3 % Other income 1.92 0.2 % 2.82 0.4 % 6.39 0.3 % 8.08 0.4 % Interest expense (50.06 ) -6.1 % (37.89 ) -5.2 % (138.74 ) -5.9 % (106.35 ) -4.9 % Net interest margin 50.52 6.2 % 54.19 7.4 % 149.47 6.4 % 153.68 7.1 % Provision for credit losses 0.99 0.1 % 2.00 0.3 % 4.58 0.2 % 20.70 1.0 % Risk adjusted margin 51.52 6.3 % 56.19 7.7 % 154.05 6.6 % 174.38 8.0 % Other operating expenses (5) (44.67 ) -5.4 % (41.97 ) -5.7 % (133.97 ) -5.7 % (123.13 ) -5.7 % Pre-tax income $ 6.85 0.8 % $ 14.22 1.9 % $ 20.08 0.9 % $ 51.25 2.4 % (1) Excludes third party portfolios. (2) Wholesale auction liquidation amounts (net of expenses) as a percentage of the account balance at the time of sale. (3) Numbers may not add due to rounding. (4) Annualized percentage of the average portfolio balance. Percentages may not add due to rounding. (5) Total pre-tax expenses less provision for credit losses and interest expense. 
