- Net income of $20.8 million and diluted
earnings per share of $2.04 -
- 22.6% year-over-year revenue growth and 26.5%
year-over-year core net finance receivables growth -
- 30+ day contractual delinquencies of 6.0% as
of December 31, 2021, a 100 basis point improvement from December
31, 2019 -
- Increases quarterly cash dividend by 20% to
$0.30 per common share and announces a new $20 million stock
repurchase program -
Regional Management Corp. (NYSE: RM), a diversified consumer
finance company, today announced results for the fourth quarter
ended December 31, 2021.
“We continued to deliver consistent, predictable, and superior
results in the fourth quarter,” said Robert W. Beck, President and
Chief Executive Officer of Regional Management Corp. “Our strategic
investments in digital initiatives, geographic expansion, and
product and channel development, along with our proven,
multi-channel marketing engine, continue to generate substantial,
profitable growth. In the fourth quarter, we grew our loan
portfolio sequentially by $112 million, driving our ending net
finance receivables to an all-time high of more than $1.4 billion,
up 26% over the prior year. Our portfolio fueled record quarterly
revenue of $119 million, an increase of 23% year-over-year, and in
combination with a strong credit profile, disciplined expense
management, and low funding costs, we delivered $20.8 million of
net income and $2.04 of diluted EPS.”
“In 2021, we posted a number of annual and quarterly records on
both our balance sheet and income statement,” added Mr. Beck. “I’m
proud of our team’s relentless execution on our strategic growth
initiatives and our company’s production of strong results
benefitting all stakeholders. We finished the year with $88.7
million of net income, $8.33 of diluted EPS, 7.2% ROA, 31.6% ROE, a
net credit loss rate of 6.6%, and a 30+ day delinquency rate just
below 6.0%. In recognition of these exceptional results, our strong
capital position, and the long-term earnings power of our business,
we are increasing our quarterly dividend by 20% to $0.30 per share
and announcing a new $20 million stock repurchase program.”
“We entered 2022 in a position of considerable strength, with
ample liquidity and borrowing capacity to support our ambitious
growth objectives and a credit profile that remains stronger than
pre-pandemic levels,” continued Mr. Beck. “In the new year, we will
continue to gain market share by investing heavily in technology
and digital customer acquisition, expanding geographically to at
least an additional five new states, and further diversifying our
products and marketing channels. We remain well-situated to execute
on our long-term strategies, and we look forward to delivering
profitable growth, sustainable long-term value, and capital returns
in the future.”
Fourth Quarter 2021 Highlights
- Net income for the fourth quarter of 2021 was $20.8 million and
diluted earnings per share was $2.04, increases of 44.8% and 59.4%,
respectively, compared to the prior-year period.
- Net finance receivables as of December 31, 2021 hit an all-time
high of $1.4 billion, a record increase of $290.0 million, or
25.5%, from the prior-year period.
- Total core small and large loan net finance
receivables increased $296.1 million, or 26.5%, compared to the
prior-year period.
- Large loan net finance receivables of
$969.4 million increased $254.1 million, or 35.5%, from the
prior-year period and represented 68.0% of the total loan
portfolio. Small loan net finance receivables were $445.0 million,
an increase of 10.4% from the prior-year period.
- Record loan originations of $434.4 million
in the fourth quarter of 2021, an increase of $70.4 million, or
19.3%, from the prior-year period.
- Record digitally sourced originations of
$48.7 million in the fourth quarter of 2021, an increase of $28.0
million, or 134.8%, from the prior-year period.
- Total revenue for the fourth quarter of 2021 was a record
$119.5 million, an increase of $22.0 million, or 22.6%, from the
prior-year period.
- Interest and fee income increased $20.3
million, or 23.3%, primarily due to higher average net finance
receivables.
- Insurance income, net increased $1.5
million, or 19.4%, driven by an increase in premium revenue,
partially offset by increases in life insurance claims expense and
expected non-file insurance claims.
- Provision for credit losses for the fourth quarter of 2021 was
$31.0 million, an increase of $6.3 million, or 25.5%, from the
prior-year period. The provision for credit losses for the fourth
quarter of 2021 included a release in the allowance for credit
losses of $1.1 million related to the expected economic impact of
the COVID-19 pandemic and a net build of $10.3 million related to
portfolio growth.
- Allowance for credit losses was $159.3
million as of December 31, 2021, including a $14.4 million
allowance for credit losses associated with COVID-19.
- Annualized net credit losses as a percentage of average net
finance receivables for the fourth quarter of 2021 were 6.4%, a 50
basis point improvement compared to 6.9% in the prior-year
period.
- As of December 31, 2021, 30+ day contractual delinquencies
totaled $84.9 million, or 6.0% of net finance receivables, an
increase of 70 basis points compared to the prior-year period, but
a 100 basis point improvement from December 31, 2019. The 30+ day
contractual delinquency remains well below the company’s $159.3
million allowance for credit losses as of December 31, 2021.
- As previously noted, the company closed 31 branches in the
fourth quarter where clear opportunities existed to consolidate
operations into a larger branch in close proximity. This branch
optimization is consistent with the company’s omni-channel strategy
and builds upon the company’s recent successes in entering new
states with a lighter branch footprint, while still providing
customers with best-in-class service. The company incurred $0.9
million of branch optimization expenses in the fourth quarter. The
branch optimization will generate approximately $2.2 million in
annual savings, which the company will reinvest in its expansion
into new states.
- General and administrative expenses for the fourth quarter of
2021 were $55.5 million, an increase of $10.7 million, or 24.0%,
from the prior-year period due to ongoing investment in personnel,
marketing, and digital capabilities to support the company’s growth
strategy. General and administrative expenses for the fourth
quarter of 2021 included $0.9 million of expenses related to branch
optimization.
- The operating expense ratio (annualized general and
administrative expenses as a percentage of average net finance
receivables) for the fourth quarter of 2021 was 16.3%, a 10 basis
point improvement compared to the prior-year period. The operating
expense ratio was inclusive of a 30 basis point impact related to
branch optimization.
- In the fourth quarter of 2021, the company repurchased 199,155
shares of its common stock at a weighted-average price of $57.38
per share under the company’s $50 million stock repurchase program.
The company repurchased 933,696 shares in total under the program
at a weighted-average price of $52.91 per share through December
2021, and has since completed the repurchase program.
First Quarter 2022 Dividend and New Stock Repurchase
Program
The company’s Board of Directors has declared a dividend of
$0.30 per common share for the first quarter of 2022. The dividend
is 20% higher than the prior quarter’s dividend and will be paid on
March 16, 2022 to shareholders of record as of the close of
business on February 23, 2022. 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.
In addition, the company’s Board of Directors has authorized a
new stock repurchase program allowing for the repurchase of up to
$20 million of its outstanding common stock. The authorization is
effective immediately and will continue through February 3,
2024.
Share repurchases under the stock repurchase program may be made
in the open market at prevailing market prices, through privately
negotiated transactions, or through other structures in accordance
with applicable federal securities laws, at times and in amounts as
management deems appropriate. The timing and the amount of any
common stock repurchases will be determined by the company’s
management based on its evaluation of market conditions, the
company’s liquidity needs, legal and contractual requirements and
restrictions (including covenants in the company’s credit
agreements), share price, and other factors. Repurchases of common
stock may be made under a Rule 10b5-1 plan, which would permit
common stock to be repurchased when the company might otherwise be
precluded from doing so under insider trading laws. The repurchase
program does not obligate the company to purchase any particular
number of shares and may be suspended, modified, or discontinued at
any time without prior notice.
Liquidity and Capital Resources
As of December 31, 2021, the company had net finance receivables
of $1.4 billion and debt of $1.1 billion. The debt consisted
of:
- $112.1 million on the company’s $500 million senior revolving
credit facility,
- $132.0 million on the company’s aggregate $300 million
revolving warehouse credit facilities, and
- $863.9 million through the company’s asset-backed
securitizations.
As of December 31, 2021, the company’s unused capacity to fund
future growth on its revolving credit facilities (subject to the
borrowing base) was $557 million, or 69.6%, and the company had
available liquidity of $209.7 million, including unrestricted cash
on hand and immediate availability to draw down cash from its
revolving credit facilities.
As of December 31, 2021, the company’s fixed-rate debt as a
percentage of total debt was 78%, with a weighted-average coupon of
2.7% and an average revolving duration of 3.1 years. The company
also held interest rate caps with an aggregate notional principal
amount of $550 million to manage the risk associated with variable
rate debt. The interest rate caps are based on the one-month LIBOR
and reimburse the company for the difference when the one-month
LIBOR exceeds the strike rate. Of the aggregate amount, $450
million of the interest rate caps have strike rates of 25 or 50
basis points and a weighted-average duration of 2.0 years.
The company had a funded debt-to-equity ratio of 3.9 to 1.0 and
a stockholders’ equity ratio of 19.4%, each as of December 31,
2021. On a non-GAAP basis, the company had a funded
debt-to-tangible equity ratio of 4.1 to 1.0, as of December 31,
2021. 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” in more than 350 branch locations in 14
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,
retailers, 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: risks
related to Regional Management’s business, including the COVID-19
pandemic and its impact on Regional Management’s operations and
financial condition; 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 new underwriting models and processes,
including as to the effectiveness of new 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;
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, including those associated with CECL accounting; the
impact of changes in tax laws, guidance, and interpretations,
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
COVID-19 pandemic may also magnify many of these risks and
uncertainties.
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)
4Q 21
4Q 20
$
%
FY 21
FY 20
$
%
Revenue
Interest and fee income
$
107,117
$
86,845
$
20,272
23.3
%
$
382,544
$
335,215
$
47,329
14.1
%
Insurance income, net
9,423
7,889
1,534
19.4
%
35,482
28,349
7,133
25.2
%
Other income
2,944
2,710
234
8.6
%
10,325
10,342
(17
)
(0.2
)%
Total revenue
119,484
97,444
22,040
22.6
%
428,351
373,906
54,445
14.6
%
Expenses
Provision for credit losses
31,008
24,700
(6,308
)
(25.5
)%
89,015
123,810
34,795
28.1
%
Personnel
33,313
26,979
(6,334
)
(23.5
)%
119,833
109,560
(10,273
)
(9.4
)%
Occupancy
6,511
5,900
(611
)
(10.4
)%
24,126
22,629
(1,497
)
(6.6
)%
Marketing
4,431
3,984
(447
)
(11.2
)%
14,405
10,357
(4,048
)
(39.1
)%
Other
11,277
7,931
(3,346
)
(42.2
)%
37,150
33,770
(3,380
)
(10.0
)%
Total general and administrative
55,532
44,794
(10,738
)
(24.0
)%
195,514
176,316
(19,198
)
(10.9
)%
Interest expense
7,597
9,256
1,659
17.9
%
31,349
37,852
6,503
17.2
%
Income before income taxes
25,347
18,694
6,653
35.6
%
112,473
35,928
76,545
213.1
%
Income taxes
4,569
4,347
(222
)
(5.1
)%
23,786
9,198
(14,588
)
(158.6
)%
Net income
$
20,778
$
14,347
$
6,431
44.8
%
$
88,687
$
26,730
$
61,957
231.8
%
Net income per common share:
Basic
$
2.18
$
1.32
$
0.86
65.2
%
$
8.84
$
2.45
$
6.39
260.8
%
Diluted
$
2.04
$
1.28
$
0.76
59.4
%
$
8.33
$
2.40
$
5.93
247.1
%
Weighted-average common shares
outstanding:
Basic
9,545
10,882
1,337
12.3
%
10,034
10,930
896
8.2
%
Diluted
10,177
11,228
1,051
9.4
%
10,643
11,145
502
4.5
%
Return on average assets (annualized)
6.0
%
5.4
%
7.2
%
2.5
%
Return on average equity (annualized)
29.5
%
20.8
%
31.6
%
10.0
%
Regional Management Corp. and
Subsidiaries
Consolidated Balance
Sheets
(Unaudited)
(dollars in thousands, except
par value amounts)
Increase (Decrease)
4Q 21
4Q 20
$
%
Assets
Cash
$
10,507
$
8,052
$
2,455
30.5
%
Net finance receivables
1,426,257
1,136,259
289,998
25.5
%
Unearned insurance premiums
(47,837
)
(34,545
)
(13,292
)
(38.5
)%
Allowance for credit losses
(159,300
)
(150,000
)
(9,300
)
(6.2
)%
Net finance receivables, less unearned
insurance premiums and allowance for credit losses
1,219,120
951,714
267,406
28.1
%
Restricted cash
138,682
63,824
74,858
117.3
%
Lease assets
28,721
27,116
1,605
5.9
%
Deferred tax assets, net
18,420
14,121
4,299
30.4
%
Property and equipment
12,938
14,008
(1,070
)
(7.6
)%
Intangible assets
9,517
8,689
828
9.5
%
Other assets
21,757
16,332
5,425
33.2
%
Total assets
$
1,459,662
$
1,103,856
$
355,806
32.2
%
Liabilities and Stockholders’
Equity
Liabilities:
Debt
$
1,107,953
$
768,909
$
339,044
44.1
%
Unamortized debt issuance costs
(11,010
)
(6,661
)
(4,349
)
(65.3
)%
Net debt
1,096,943
762,248
334,695
43.9
%
Accounts payable and accrued expenses
49,283
40,284
8,999
22.3
%
Lease liabilities
30,700
29,201
1,499
5.1
%
Total liabilities
1,176,926
831,733
345,193
41.5
%
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, 14,157 shares issued and 9,788 shares
outstanding at December 31, 2021 and 13,851 shares issued and
10,932 shares outstanding at December 31, 2020)
1,416
1,385
31
2.2
%
Additional paid-in capital
104,745
105,483
(738
)
(0.7
)%
Retained earnings
306,105
227,343
78,762
34.6
%
Treasury stock (4,370 shares at December
31, 2021 and 2,919 shares at December 31, 2020)
(129,530
)
(62,088
)
(67,442
)
(108.6
)%
Total stockholders’ equity
282,736
272,123
10,613
3.9
%
Total liabilities and stockholders’
equity
$
1,459,662
$
1,103,856
$
355,806
32.2
%
Regional Management Corp. and
Subsidiaries
Selected Financial
Data
(Unaudited)
(dollars in thousands, except
per share amounts)
Net Finance Receivables by
Product
4Q 21
3Q 21
QoQ $ Inc (Dec)
QoQ % Inc (Dec)
4Q 20
YoY $ Inc (Dec)
YoY % Inc (Dec)
Small loans
$
445,023
$
419,602
$
25,421
6.1
%
$
403,062
$
41,961
10.4
%
Large loans
969,351
882,514
86,837
9.8
%
715,210
254,141
35.5
%
Total core loans
1,414,374
1,302,116
112,258
8.6
%
1,118,272
296,102
26.5
%
Automobile loans
1,343
1,757
(414
)
(23.6
)%
3,889
(2,546
)
(65.5
)%
Retail loans
10,540
10,360
180
1.7
%
14,098
(3,558
)
(25.2
)%
Total net finance receivables
$
1,426,257
$
1,314,233
$
112,024
8.5
%
$
1,136,259
$
289,998
25.5
%
Number of branches at period end
350
372
(22
)
(5.9
)%
365
(15
)
(4.1
)%
Net finance receivables per branch
$
4,075
$
3,533
$
542
15.3
%
$
3,113
$
962
30.9
%
Averages and Yields
4Q 21
3Q 21
4Q 20
Average Net Finance
Receivables
Average Yield
(Annualized)
Average Net Finance
Receivables
Average Yield
(Annualized)
Average Net Finance
Receivables
Average Yield
(Annualized)
Small loans
$
427,586
38.1
%
$
394,888
38.9
%
$
387,688
38.4
%
Large loans
923,674
28.5
%
834,470
28.9
%
683,520
28.5
%
Automobile loans
1,552
12.9
%
2,036
13.4
%
4,360
14.3
%
Retail loans
10,435
18.7
%
10,291
18.8
%
14,908
18.3
%
Total interest and fee yield
$
1,363,247
31.4
%
$
1,241,685
32.0
%
$
1,090,476
31.9
%
Total revenue yield
$
1,363,247
35.1
%
$
1,241,685
35.9
%
$
1,090,476
35.7
%
Components of Increase in
Interest and Fee Income
4Q 21 Compared to 4Q
20
Increase (Decrease)
Volume
Rate
Volume & Rate
Total
Small loans
$
3,834
$
(329
)
$
(34
)
$
3,471
Large loans
17,128
(20
)
(7
)
17,101
Automobile loans
(100
)
(16
)
10
(106
)
Retail loans
(204
)
15
(5
)
(194
)
Product mix
1,065
(811
)
(254
)
—
Total increase in interest and fee
income
$
21,723
$
(1,161
)
$
(290
)
$
20,272
Loans Originated (1)
(2)
4Q 21
3Q 21
QoQ $ Inc (Dec)
QoQ % Inc (Dec)
4Q 20
YoY $ Inc (Dec)
YoY % Inc (Dec)
Small loans
$
175,898
$
173,390
$
2,508
1.4
%
$
164,360
$
11,538
7.0
%
Large loans
255,828
245,062
10,766
4.4
%
197,737
58,091
29.4
%
Retail loans
2,630
2,206
424
19.2
%
1,889
741
39.2
%
Total loans originated
$
434,356
$
420,658
$
13,698
3.3
%
$
363,986
$
70,370
19.3
%
(1) Represents the principal balance of loan originations and
refinancings. (2) The company ceased originating automobile
purchase loans in November 2017.
Other Key Metrics
4Q 21
3Q 21
4Q 20
Net credit losses
$
21,808
$
15,396
$
18,700
Percentage of average net finance
receivables (annualized)
6.4
%
5.0
%
6.9
%
Provision for credit losses (1)
$
31,008
$
26,096
$
24,700
Percentage of average net finance
receivables (annualized)
9.1
%
8.4
%
9.1
%
Percentage of total revenue
26.0
%
23.4
%
25.3
%
General and administrative expenses
$
55,532
$
47,750
$
44,794
Percentage of average net finance
receivables (annualized)
16.3
%
15.4
%
16.4
%
Percentage of total revenue
46.5
%
42.8
%
46.0
%
Same store results (2):
Net finance receivables at period-end
$
1,400,817
$
1,296,746
$
1,125,507
Net finance receivable growth rate
23.3
%
22.7
%
0.1
%
Number of branches in calculation
330
359
347
(1) Includes COVID-19 pandemic impacts to provision for credit
losses of $(1,100), $(2,000), and $(1,500) for 4Q 21, 3Q 21, and 4Q
20, respectively. (2) 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 by
Aging
4Q 21
3Q 21
4Q 20
Allowance for credit losses (1)
$
159,300
11.2
%
$
150,100
11.4
%
$
150,000
13.2
%
Current
1,237,165
86.7
%
1,156,475
88.0
%
990,467
87.2
%
1 to 29 days past due
104,201
7.3
%
96,477
7.3
%
85,342
7.5
%
Delinquent accounts:
30 to 59 days
25,283
1.9
%
20,162
1.6
%
18,381
1.6
%
60 to 89 days
20,395
1.4
%
15,075
1.1
%
14,955
1.3
%
90 to 119 days
15,962
1.0
%
11,202
0.9
%
10,496
0.9
%
120 to 149 days
12,466
0.9
%
8,176
0.6
%
9,085
0.8
%
150 to 179 days
10,785
0.8
%
6,666
0.5
%
7,533
0.7
%
Total contractual delinquency
$
84,891
6.0
%
$
61,281
4.7
%
$
60,450
5.3
%
Total net finance receivables
$
1,426,257
100.0
%
$
1,314,233
100.0
%
$
1,136,259
100.0
%
1 day and over past due
$
189,092
13.3
%
$
157,758
12.0
%
$
145,792
12.8
%
Contractual Delinquency by
Product
4Q 21
3Q 21
4Q 20
Small loans
$
39,794
8.9
%
$
27,928
6.7
%
$
27,703
6.9
%
Large loans
44,264
4.6
%
32,523
3.7
%
31,259
4.4
%
Automobile loans
84
6.3
%
143
8.1
%
296
7.6
%
Retail loans
749
7.1
%
687
6.6
%
1,192
8.5
%
Total contractual delinquency
$
84,891
6.0
%
$
61,281
4.7
%
$
60,450
5.3
%
(1) Includes incremental COVID-19 allowance for credit losses of
$14,400, $15,500, and $30,400 in 4Q 21, 3Q 21, and 4Q 20,
respectively.
Income Statement Quarterly
Trend
4Q 20
1Q 21
2Q 21
3Q 21
4Q 21
QoQ $ B(W)
YoY $ B(W)
Revenue
Interest and fee income
$
86,845
$
87,279
$
88,793
$
99,355
$
107,117
$
7,762
$
20,272
Insurance income, net
7,889
7,985
8,656
9,418
9,423
5
1,534
Other income
2,710
2,467
2,227
2,687
2,944
257
234
Total revenue
97,444
97,731
99,676
111,460
119,484
8,024
22,040
Expenses
Provision for credit losses
24,700
11,362
20,549
26,096
31,008
(4,912
)
(6,308
)
Personnel
26,979
28,851
28,370
29,299
33,313
(4,014
)
(6,334
)
Occupancy
5,900
6,020
5,568
6,027
6,511
(484
)
(611
)
Marketing
3,984
2,710
4,776
2,488
4,431
(1,943
)
(447
)
Other
7,931
8,262
7,675
9,936
11,277
(1,341
)
(3,346
)
Total general and administrative
44,794
45,843
46,389
47,750
55,532
(7,782
)
(10,738
)
Interest expense
9,256
7,135
7,801
8,816
7,597
1,219
1,659
Income before income taxes
18,694
33,391
24,937
28,798
25,347
(3,451
)
6,653
Income taxes
4,347
7,869
4,771
6,577
4,569
2,008
(222
)
Net income
$
14,347
$
25,522
$
20,166
$
22,221
$
20,778
$
(1,443
)
$
6,431
Net income per common share:
Basic
$
1.32
$
2.42
$
1.98
$
2.25
$
2.18
$
(0.07
)
$
0.86
Diluted
$
1.28
$
2.31
$
1.87
$
2.11
$
2.04
$
(0.07
)
$
0.76
Weighted-average shares outstanding:
Basic
10,882
10,543
10,200
9,861
9,545
316
1,337
Diluted
11,228
11,066
10,797
10,544
10,177
367
1,051
Net interest margin
$
88,188
$
90,596
$
91,875
$
102,644
$
111,887
$
9,243
$
23,699
Net credit margin
$
63,488
$
79,234
$
71,326
$
76,548
$
80,879
$
4,331
$
17,391
Balance Sheet Quarterly
Trend
4Q 20
1Q 21
2Q 21
3Q 21
4Q 21
QoQ $ Inc (Dec)
YoY $ Inc (Dec)
Total assets
$
1,103,856
$
1,098,295
$
1,191,305
$
1,313,558
$
1,459,662
$
146,104
$
355,806
Net finance receivables
$
1,136,259
$
1,105,603
$
1,183,387
$
1,314,233
$
1,426,257
$
112,024
$
289,998
Allowance for credit losses
$
150,000
$
139,600
$
139,400
$
150,100
$
159,300
$
9,200
$
9,300
Debt
$
768,909
$
752,200
$
853,067
$
978,803
$
1,107,953
$
129,150
$
339,044
Other Key Metrics Quarterly
Trend
4Q 20
1Q 21
2Q 21
3Q 21
4Q 21
QoQ Inc (Dec)
YoY Inc (Dec)
Interest and fee yield (annualized)
31.9
%
31.1
%
31.6
%
32.0
%
31.4
%
(0.6
)%
(0.5
)%
Efficiency ratio (1)
46.0
%
46.9
%
46.5
%
42.8
%
46.5
%
3.7
%
0.5
%
Operating expense ratio (2)
16.4
%
16.3
%
16.5
%
15.4
%
16.3
%
0.9
%
(0.1
)%
30+ contractual delinquency
5.3
%
4.3
%
3.6
%
4.7
%
6.0
%
1.3
%
0.7
%
Net credit loss ratio (3)
6.9
%
7.7
%
7.4
%
5.0
%
6.4
%
1.4
%
(0.5
)%
Book value per share
$
24.89
$
26.28
$
26.93
$
27.73
$
28.89
$
1.16
$
4.00
(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
FY 21
FY 20
Average Net Finance
Receivables
Average Yield
(Annualized)
Average Net Finance
Receivables
Average Yield
(Annualized)
Small loans
$
394,394
38.2
%
$
406,675
37.3
%
Large loans
805,808
28.5
%
642,085
27.9
%
Automobile loans
2,422
13.0
%
6,315
14.0
%
Retail loans
11,259
18.3
%
18,791
18.2
%
Total interest and fee yield
$
1,213,883
31.5
%
$
1,073,866
31.2
%
Total revenue yield
$
1,213,883
35.3
%
$
1,073,866
34.8
%
Components of Increase in
Interest and Fee Income
FY 21 Compared to FY
20
Increase (Decrease)
Volume
Rate
Volume & Rate
Total
Small loans
$
(4,576
)
$
3,781
$
(114
)
$
(909
)
Large loans
45,737
3,530
900
50,167
Automobile loans
(546
)
(64
)
40
(570
)
Retail loans
(1,373
)
23
(9
)
(1,359
)
Product mix
4,465
(4,066
)
(399
)
—
Total increase in interest and fee
income
$
43,707
$
3,204
$
418
$
47,329
Loans Originated (1)
(2)
FY 21
FY 20
FY $ Inc (Dec)
FY % Inc (Dec)
Small loans
$
602,613
$
516,124
$
86,489
16.8
%
Large loans
856,699
557,952
298,747
53.5
%
Retail loans
8,275
9,201
(926
)
(10.1
)%
Total loans originated
$
1,467,587
$
1,083,277
$
384,310
35.5
%
(1) Represents the principal balance of loan originations and
refinancings. (2) The company ceased originating automobile loans
in November 2017.
Other Key Metrics
FY 21
FY 20
Net credit losses
$
79,715
$
96,110
Percentage of average net finance
receivables (annualized)
6.6
%
8.9
%
Provision for credit losses (1)
$
89,015
$
123,810
Percentage of average net finance
receivables (annualized)
7.3
%
11.5
%
Percentage of total revenue
20.8
%
33.1
%
General and administrative expenses (2)
(3) (4)
$
195,514
$
176,316
Percentage of average net finance
receivables (annualized)
16.1
%
16.4
%
Percentage of total revenue
45.6
%
47.2
%
(1) Includes COVID-19 pandemic impacts to provision for credit
losses of $(16,000) and $30,400 for FY 21 and FY 20, respectively.
(2) Includes non-operating executive transition costs of $3,066 for
YTD 20. (3) Includes non-operating loan management system outage
costs of $720 for YTD 20. (4) Includes non-operating severance
costs of $778 for YTD 20.
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 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.
4Q 21
Debt
$
1,107,953
Total stockholders' equity
282,736
Less: Intangible assets
9,517
Tangible equity (non-GAAP)
$
273,219
Funded debt-to-equity ratio
3.9
x
Funded debt-to-tangible equity ratio
(non-GAAP)
4.1
x
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220209005917/en/
Investor Relations Garrett Edson, (203) 682-8331
investor.relations@regionalmanagement.com
Grafico Azioni Regional Management (NYSE:RM)
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Grafico Azioni Regional Management (NYSE:RM)
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