CURO Group Holdings Corp. Announces Second Quarter 2022 Financial Results

Consolidated Revenue Grew 62.2% in the Quarter Compared to 2021

WICHITA, Kan.–(BUSINESS WIRE)–CURO Group Holdings Corp. (NYSE: CURO) (“CURO” or the “Company”), a tech-enabled, omni-channel consumer finance company serving a full spectrum of non-prime and prime consumers in the U.S. and Canada, today announced financial results for its second quarter ended June 30, 2022.

“It was a very busy and productive quarter for CURO. In July, we successfully closed the transformative transactions that we announced in May 2022 – the sale of our legacy US Direct Lending business and acquisition of First Heritage Credit,” said Don Gayhardt, CURO’s Chief Executive Officer. “These transactions complete CURO’s strategic transition into longer term, higher balance and lower rate credit products, simplify and improve the future predictability of our business results, expand our access to lower cost funding, and focuses our capital on higher-growth, durable business lines. On the funding side, we also entered into new non-recourse revolving warehouse facilities to fund the loan portfolios and new originations for Heights Finance and First Heritage at lower spreads and higher advance rates.

“I am proud of what our team accomplished during these trying market conditions while still driving solid results in our Heights Finance, Canada Direct Lending, and Flexiti businesses. Excluding the sold U.S. Legacy Direct Lending business, loan balances grew 163.7% year-over-year and 9.4% sequentially compared to the first quarter of 2022. As expected, this solid sequential loan growth and normalization of net charge-off rates and loan loss provisions caused a meaningful reduction in year-over-year earnings for the quarter. As we enter the second half of the year, we will be laser-focused on execution – integrating and capitalizing on the Heights Finance and First Heritage acquisition synergies, careful credit risk management, liquidity and optimizing our cost structure in the wake of the sale of our U.S. Legacy Direct Lending business.”

Consolidated Summary Results

We reported a Net loss of $26.1 million ($0.65 loss per share) and Adjusted net loss of $11.3 million ($0.28 adjusted loss per share) on revenue of $304.4 million for the three months ended June 30, 2022, compared with Net income of $104.5 million ($2.39 per share) and Adjusted net income of $17.4 million ($0.40 adjusted diluted earnings per share) on total revenue of $187.7 million for the three months ended June 30, 2021.

The decline in Net income was primarily driven by (i) year-over-year comparisons for the provision for loan losses which continued to be affected by COVID-19 impacts during the second quarter of 2021 and (ii), higher interest expense. During the second quarter of 2021 Katapult became a public company via a SPAC merger, generating a pretax gain of $135.4 million. Government stimulus in March 2021 and pandemic-related consumer behavior reduced demand, increased payment rates and lowered loss rates in the second quarter of 2021, resulting in a provision for loan losses that was $4.6 million less than net charge-offs (NCOs). In this year’s second quarter, credit normalization and strong sequential loan growth resulted in a provision for loan losses that exceeded NCOs by $24.3 million (including the impact of purchase accounting for the Heights Finance portfolio acquired in December 2021). Interest expense increased because of our issuance of 7.50% Senior Secured Notes in the fourth quarter of 2021 to finance, in part, the Heights Finance acquisition, as well as the expansion of non-recourse asset-backed facility borrowing to support loan growth.

Below are additional highlights of our performance this year:

  • Revenue and Net Revenue
    • Revenue increased $116.7 million, or 62.2%, year over year, primarily driven by our December 27, 2021 acquisition of Heights Finance, which accounted for $74.3 million of revenue for the second quarter of 2022. Revenue for Canada POS Lending and Canada Direct Lending grew 229.9% and 22.1%, respectively, year over year.
    • Sequentially, revenue increased $14.2 million, or 4.9%, driven by growth of $2.8 million, or 14.0%, in Canada POS Lending, $4.1 million, or 5.7%, in Canada Direct Lending, and $7.3 million, or 3.7% in the U.S. Direct Lending.
    • For the three months ended June 30, 2022, net revenue increased $32.3 million, or 22.7%, year over year, and $17.8 million sequentially. Excluding Heights Finance, net revenue decreased $54.1 million, or 28.1%, year over year, because of the aforementioned loan loss provision comparisons.
  • Loans Receivable
    • Year-over-year growth in Company Owned gross loans receivable and combined gross loans receivable (gross loans receivable plus loans originated by third-party lenders which are guaranteed by the company) of $1,011.6 million, or 131.5%, and $1,025.8 million, or 127.2%, respectively, as a result of the acquisition of Heights Finance. Excluding Heights Finance, combined gross loans receivables increased $534.3 million, or 66.3%, year over year, primarily driven by $405.7 million, or 183.2%, for Canada POS Lending. Canada and U.S. Direct Lending (excluding Heights Finance) combined gross loans receivable grew 29.4% and 10.0%, respectively, versus the second quarter of 2021.
    • Sequential loan growth in Company Owned gross loans receivable and combined gross loans receivable of $152.3 million, or 9.4%, and $159.2 million, or 9.5%, respectively, was primarily due to growth in Canada POS Lending of $85.4 million, or 15.8%, and U.S. Direct Lending of $54.3 million, or 7.9%.
  • NCOs and Delinquency Metrics
    • Consolidated quarterly NCO rates improved by 60 bps year over year, primarily from the relative growth of Canada POS Lending and the acquisition of Heights Finance, which shifts our loan portfolio mix to lower loss-rate products offset by credit normalization in the U.S. Direct Lending business.
    • Sequentially, consolidated quarterly NCO rates improved by 80 bps, largely driven by loan growth at Heights and Canada POS Lending, which have lower NCO rates, offset by credit normalization in the U.S. Direct Lending business.
    • Consolidated past-due rates increased 300 bps year over year as credit continued to normalize compared to the first six months of 2021, which was affected by pandemic-related U.S. government stimulus.
    • Consolidated past-due rates increased by 100 bps sequentially, primarily due to seasonality and credit normalization.
  • Other Highlights
    • On July 8, 2022, we completed the sale of our U.S. Legacy Direct Lending business to Community Choice Financial, a consumer financial services company based in Dublin, Ohio, for total cash consideration of $345 million. The consideration included $310 million in cash paid at closing and $35 million payable in monthly installment payments over the subsequent 12 months.
    • On July 13, 2022, we completed the acquisition of First Heritage Credit (“FHC”), a consumer lender that provides near-prime installment loans along with customary opt-in insurance and other financial products, based in Ridgeland, Mississippi, for a total purchase price of $140 million in cash.
    • On July 13, 2022, concurrently with the closing of the FHC acquisition, we entered into a new $225 million non-recourse revolving warehouse facility to replace FHC’s incumbent lender’s facility and finance future loans originated by FHC.
    • On July 15, 2022, we entered into a new $425 million non-recourse revolving warehouse facility to replace the incumbent lender’s facility and finance future loans originated by Heights Finance.
    • On August 3, 2022 we declared the next quarterly dividend of $0.11 per share, payable on August 26, 2022 to stockholders of record as of August 15, 2022.

From the second quarter of 2020 through the first half of 2021, we experienced lower customer demand in the U.S. and Canada Direct Lending, relatively good credit performance, increased or accelerated repayments and favorable payment trends, as customers were aided by government stimulus programs while periodically enduring pandemic lockdowns as a result of COVID-19. From the third quarter of 2021 through the second quarter of 2022, our markets were less affected by COVID-19, resulting in positive growth trends in revenue and receivables, along with increases in charged off accounts as stimulus programs waned and credit normalized.

Results of Consolidated Operations

Beginning January 1, 2022, we began reporting “Interest and fees revenue,” “Insurance premiums and commissions” and “Other revenue” in place of our previously reported “Revenue” on our Statements of Operations. Prior period presentations have been revised to conform to the current period presentation.

Table 1 – Consolidated Statements of Operations

(in thousands, unaudited)

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2022

 

 

2021

 

Change $

Change %

 

 

2022

 

 

2021

 

Change $

Change %

Revenue

 

 

 

 

 

 

 

 

 

 

Interest and fees revenue

 

$

278,331

 

$

169,403

 

$

108,928

 

64.3

%

 

 

543,287

 

 

348,526

 

 

194,761

 

55.9

%

Insurance premiums and commissions

 

 

18,653

 

 

11,853

 

 

6,800

 

57.4

%

 

 

36,913

 

 

23,422

 

 

13,491

 

57.6

%

Other revenue

 

 

7,420

 

 

6,437

 

 

983

 

15.3

%

 

 

14,400

 

 

12,296

 

 

2,104

 

17.1

%

Total revenue

 

 

304,404

 

 

187,693

 

 

116,711

 

62.2

%

 

 

594,600

 

 

384,244

 

 

210,356

 

54.7

%

Provision for losses

 

 

129,546

 

 

45,165

 

 

84,381

 

186.8

%

 

 

227,077

 

 

81,310

 

 

145,767

 

#

Net revenue

 

 

174,858

 

 

142,528

 

 

32,330

 

22.7

%

 

 

367,523

 

 

302,934

 

 

64,589

 

21.3

%

Operating Expenses

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

 

82,427

 

 

58,320

 

 

24,107

 

41.3

%

 

 

162,156

 

 

113,237

 

 

48,919

 

43.2

%

Occupancy

 

 

17,507

 

 

13,783

 

 

3,724

 

27.0

%

 

 

34,544

 

 

28,130

 

 

6,414

 

22.8

%

Advertising

 

 

12,707

 

 

7,043

 

 

5,664

 

80.4

%

 

 

23,207

 

 

15,127

 

 

8,080

 

53.4

%

Direct operations

 

 

20,293

 

 

13,699

 

 

6,594

 

48.1

%

 

 

40,567

 

 

25,668

 

 

14,899

 

58.0

%

Depreciation and amortization

 

 

8,672

 

 

7,435

 

 

1,237

 

16.6

%

 

 

18,486

 

 

12,400

 

 

6,086

 

49.1

%

Other operating expense

 

 

22,801

 

 

17,218

 

 

5,583

 

32.4

%

 

 

38,913

 

 

30,170

 

 

8,743

 

29.0

%

Total operating expenses

 

 

164,407

 

 

117,498

 

 

46,909

 

39.9

%

 

 

317,873

 

 

224,732

 

 

93,141

 

41.4

%

Other expense (income)

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

42,193

 

 

23,440

 

 

18,753

 

80.0

%

 

 

80,534

 

 

42,979

 

 

37,555

 

87.4

%

Loss (income) from equity method investment

 

 

1,328

 

 

(1,712

)

 

3,040

 

#

 

 

(256

)

 

(2,258

)

 

2,002

 

(88.7

)%

Gain from equity method investment

 

 

 

 

(135,387

)

 

135,387

 

#

 

 

 

 

(135,387

)

 

135,387

 

#

Total other expense (income)

 

 

43,521

 

 

(113,659

)

 

157,180

 

#

 

 

80,278

 

 

(94,666

)

 

174,944

 

#

(Loss) income before income taxes

 

 

(33,070

)

 

138,689

 

 

(171,759

)

#

 

 

(30,628

)

 

172,868

 

 

(203,496

)

#

(Benefit) Provision for incomes taxes

 

 

(6,990

)

 

34,172

 

 

(41,162

)

#

 

 

(5,884

)

 

42,616

 

 

(48,500

)

#

Net (loss) income

 

$

(26,080

)

$

104,517

 

$

(130,597

)

#

 

($

24,744

)

$

130,252

 

($

154,996

)

#

# – Variance greater than 100% or not meaningful

 

Table 2 – Consolidated Balance Sheets

(in thousands)

 

June 30, 2022

(unaudited)

 

December 31, 2021

ASSETS

Cash and cash equivalents

$

37,394

 

 

$

63,179

 

Restricted cash

 

97,465

 

 

 

98,896

 

Gross loans receivable

 

1,592,815

 

 

 

1,548,318

 

Less: Allowance for loan losses

 

(90,286

)

 

 

(87,560

)

Loans receivable, net

 

1,502,529

 

 

 

1,460,758

 

Income taxes receivable

 

46,450

 

 

 

31,774

 

Prepaid expenses and other

 

25,370

 

 

 

42,038

 

Property and equipment, net

 

38,752

 

 

 

54,635

 

Investment in Katapult

 

28,157

 

 

 

27,900

 

Right of use asset – operating leases

 

64,602

 

 

 

116,300

 

Deferred tax assets

 

23,993

 

 

 

15,639

 

Goodwill

 

352,990

 

 

 

429,792

 

Intangibles, net

 

113,130

 

 

 

109,930

 

Other assets

 

8,558

 

 

 

9,755

 

Assets held for sale (1)

 

338,779

 

 

 

 

Total Assets

$

2,678,169

 

 

$

2,460,596

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

Liabilities

 

 

 

Accounts payable and accrued liabilities

$

81,423

 

 

$

121,434

 

Deferred revenue

 

23,425

 

 

 

21,649

 

Lease liability – operating leases

 

67,339

 

 

 

122,431

 

Contingent consideration related to acquisition

 

30,354

 

 

 

26,508

 

Income taxes payable

 

4

 

 

 

680

 

Accrued interest

 

34,970

 

 

 

34,974

 

Liability for losses on CSO lender-owned consumer loans

 

 

 

 

6,908

 

Debt

 

2,189,431

 

 

 

1,945,793

 

Other long-term liabilities

 

12,146

 

 

 

13,845

 

Deferred tax liabilities

 

12,360

 

 

 

6,044

 

Liabilities held for sale (1)

 

111,137

 

 

 

 

Total Liabilities

 

2,562,589

 

 

 

2,300,266

 

Stockholders’ Equity

 

 

 

Total Stockholders’ Equity

 

115,580

 

 

 

160,330

 

Total Liabilities and Stockholders’ Equity

$

2,678,169

 

 

$

2,460,596

 

(1) Assets held for sale and Liabilities held for sale represent the balance, as of June 30, 2022, for assets and liabilities, respectively, associated with the announced sale of the U.S. Legacy Direct Lending Business.

Table 3 – Consolidated Revenue by Product and Segment

The following table summarizes revenue by product, including revenue related to loans Held for Sale and revenue we earn from operating as a credit services organization (“CSO”) by charging customers a fee for arranging an unrelated third party to make a loan to that customer, which we refer to as “CSO fees,” for the period indicated:

 

 

Three Months Ended

 

 

June 30, 2022

 

June 30, 2021

(in thousands, unaudited)

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total

% of

Total

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total

% of

Total

Revolving LOC

 

$

28,145

$

47,591

$

20,847

$

96,583

31.7 %

 

$

24,091

$

37,450

$

6,495

$

68,036

36.2 %

Installment

 

 

169,879

 

11,869

 

 

181,748

59.7 %

 

 

90,826

 

10,541

 

 

101,367

54.0 %

Total interest and fees

 

 

198,024

 

59,460

 

20,847

 

278,331

91.4 %

 

 

114,917

 

47,991

 

6,495

 

169,403

90.3 %

Insurance premiums and commissions

 

 

4,323

 

13,921

 

409

 

18,653

6.1 %

 

 

 

11,678

 

143

 

11,821

6.3 %

Other revenue

 

 

3,363

 

2,161

 

1,896

 

7,420

2.4 %

 

 

3,877

 

2,211

 

381

 

6,469

3.4 %

Total revenue

 

$

205,710

$

75,542

$

23,152

$

304,404

100.0 %

 

$

118,794

$

61,880

$

7,019

$

187,693

100.0 %

 

 

 

Six Months Ended

 

 

June 30, 2022

 

June 30, 2021

(in thousands, unaudited)

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total

% of

Total

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total

% of

Total

Revolving LOC

 

$

55,059

$

93,045

$

39,502

$

187,606

31.6 %

 

$

51,014

$

71,818

$

7,939

$

130,771

34.0 %

Installment

 

 

332,703

 

22,978

 

 

355,681

59.8 %

 

 

196,767

 

20,988

 

 

217,755

56.7 %

Total interest and fees

 

 

387,762

 

116,023

 

39,502

 

543,287

91.4 %

 

 

247,781

 

92,806

 

7,939

 

348,526

90.7 %

Insurance premiums and commissions

 

 

9,324

 

26,943

 

646

 

36,913

6.2 %

 

 

 

23,247

 

175

 

23,422

6.1 %

Other revenue

 

 

7,024

 

4,062

 

3,314

 

14,400

2.4 %

 

 

7,505

 

4,267

 

524

 

12,296

3.2 %

Total revenue

 

$

404,110

$

147,028

$

43,462

$

594,600

100.0 %

 

$

255,286

$

120,320

$

8,638

$

384,244

100.0 %

Table 4 – Consolidated Loans Receivable

The following table reconciles Company Owned gross loans receivable, a GAAP-basis balance sheet measure, to Gross combined loans receivable, a non-GAAP measure(1). Gross combined loans receivable includes loans originated by third-party lenders through CSO programs, which are not included in the Consolidated Financial Statements but from which we earn revenue by providing a guarantee to the unaffiliated lender.

 

 

 

 

As of

(in thousands, unaudited)

 

June 30,

2022

 

March 31,

2022

 

December 31,

2021

 

September 30,

2021

 

June 30,

2021

U.S.

 

 

 

 

 

 

 

 

 

 

Revolving LOC (2)

 

$

58,471

 

$

49,077

 

$

52,532

 

$

51,196

 

$

47,277

Installment – Company Owned (2)

 

 

627,651

 

 

589,652

 

 

609,413

 

 

137,987

 

 

139,234

Canada Direct Lending

 

 

 

 

 

 

 

 

 

 

Revolving LOC

 

 

442,738

 

 

424,485

 

 

402,405

 

 

366,509

 

 

337,700

Installment

 

 

24,817

 

 

23,578

 

 

24,792

 

 

24,315

 

 

23,564

Canada POS Lending

 

 

 

 

 

 

 

 

 

 

Revolving LOC

 

 

627,163

 

 

541,776

 

 

459,176

 

 

302,349

 

 

221,453

Company Owned gross loans receivable

 

$

1,780,840

 

$

1,628,568

 

$

1,548,318

 

$

882,356

 

$

769,228

Gross loans receivable Guaranteed by the Company

 

 

51,323

 

 

44,420

 

 

46,317

 

 

43,422

 

 

37,093

Gross combined loans receivable (1)

 

$

1,832,163

 

$

1,672,988

 

$

1,594,635

 

$

925,778

 

$

806,321

(1) See “Non-GAAP Financial Measures” at the end of this release for definition and more information.

(2) Includes loan balances classified as Held for Sale.

Segment Analysis

The following is a summary of segment operating (loss) income and portfolio performance for the segment and period indicated. Included are results related to the business classified as Held for Sale.

Table 5 – Summary of Segment Operating (Loss) Income

 

Three Months Ended June 30, 2022

 

Three Months Ended June 30, 2021

(dollars in thousands, unaudited)

U.S.

Canada

Direct

Lending

Canada

POS

Lending

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total revenue

$

205,711

 

$

75,540

$

23,153

 

 

$

118,794

 

$

61,880

$

7,019

 

Provision for losses

 

97,563

 

 

26,021

 

5,962

 

 

 

33,622

 

 

8,556

 

2,987

 

Net revenue

 

108,148

 

 

49,519

 

17,191

 

 

 

85,172

 

 

53,324

 

4,032

 

Total operating expenses

 

115,633

 

 

28,332

 

20,442

 

 

 

81,656

 

 

25,483

 

10,359

 

Non-recourse interest expense

 

7,544

 

 

6,147

 

8,223

 

 

 

2,503

 

 

2,498

 

3,604

 

Recourse interest expense

 

20,279

 

 

 

 

 

 

14,835

 

 

 

 

Segment operating (loss) income

$

(35,308

)

$

15,040

$

(11,474

)

 

$

(13,822

)

$

25,343

$

(9,931

)

 

 

Six Months Ended June 30, 2022

 

Six Months Ended June 30, 2021

(dollars in thousands, unaudited)

U.S.

Canada

Direct

Lending

Canada

POS

Lending

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total revenue

$

404,110

 

$

147,028

$

43,462

 

 

$

255,286

$

120,320

$

8,638

 

Provision for losses

 

164,388

 

 

48,013

 

14,676

 

 

 

59,678

 

17,790

 

3,842

 

Net revenue

 

239,722

 

 

99,015

 

28,786

 

 

 

195,608

 

102,530

 

4,796

 

Total operating expenses

 

226,574

 

 

55,353

 

35,946

 

 

 

161,549

 

50,087

 

13,096

 

Non-recourse interest expense

 

15,408

 

 

10,177

 

14,849

 

 

 

4,130

 

4,853

 

4,430

 

Recourse interest expense

 

40,100

 

 

 

 

 

 

29,566

 

 

 

Segment operating (loss) income

$

(42,360

)

$

33,485

$

(22,009

)

 

$

363

$

47,590

$

(12,730

)

 

Table 6 – Summary of Adjusted Segment Operating (Loss) Income

 

Three Months Ended June 30, 2022

 

Three Months Ended June 30, 2021

(dollars in thousands, unaudited)

U.S.

Canada

Direct

Lending

Canada

POS

Lending

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total revenue

$

205,711

 

$

75,540

$

23,153

 

 

$

118,794

 

$

61,880

$

7,019

 

Provision for losses

 

97,563

 

 

26,021

 

5,962

 

 

 

33,622

 

 

8,556

 

2,987

 

Net revenue

 

108,148

 

 

49,519

 

17,191

 

 

 

85,172

 

 

53,324

 

4,032

 

Adjusted operating expense (1)

 

107,477

 

 

28,267

 

15,426

 

 

 

69,404

 

 

25,376

 

4,881

 

Non-recourse interest expense

 

7,544

 

 

6,147

 

8,223

 

 

 

2,503

 

 

2,498

 

3,604

 

Recourse interest expense

 

20,279

 

 

 

 

 

 

14,835

 

 

 

 

Adjusted segment operating (loss) income (1)

$

(27,152

)

$

15,105

$

(6,458

)

 

$

(1,570

)

$

25,450

$

(4,453

)

(1) These are non-GAAP metrics. For a description of each non-GAAP addback, see the applicable reconciliations and descriptions of each non-GAAP metric, see “Non-GAAP Financial Measures.”

 

Six Months Ended June 30, 2022

 

Six Months Ended June 30, 2021

(dollars in thousands, unaudited)

U.S.

Canada

Direct

Lending

Canada

POS

Lending

 

U.S.

Canada

Direct

Lending

Canada

POS

Lending

Total revenue

$

404,110

 

$

147,028

$

43,462

 

 

$

255,286

$

120,320

$

8,638

 

Provision for losses

 

164,388

 

 

48,013

 

14,676

 

 

 

59,678

 

17,790

 

3,842

 

Net revenue

 

239,722

 

 

99,015

 

28,786

 

 

 

195,608

 

102,530

 

4,796

 

Adjusted operating expense (1)

 

213,833

 

 

55,086

 

30,431

 

 

 

143,700

 

49,939

 

7,618

 

Non-recourse interest expense

 

15,408

 

 

10,177

 

14,849

 

 

 

4,130

 

4,853

 

4,430

 

Recourse interest expense

 

40,100

 

 

 

 

 

 

29,566

 

 

 

Adjusted segment operating (loss) income (1)

$

(29,619

)

$

33,752

$

(16,494

)

 

$

18,212

$

47,738

$

(7,252

)

(1) These are non-GAAP metrics. For a description of each non-GAAP addback, see the applicable reconciliations and descriptions of each non-GAAP metric, see “Non-GAAP Financial Measures.”

Table 7 – U.S. Portfolio Performance

(in thousands, except percentages)

 

Q2 2022(6)

Q1 2022

 

Q4 2021(1)

Q3 2021

Q2 2021

Gross combined loans receivable (2)

 

 

 

 

 

 

 

Revolving LOC

 

$

58,471

 

$

49,077

 

 

$

52,532

 

$

51,196

 

$

47,277

 

Installment loans – Company Owned

 

 

627,651

 

 

589,652

 

 

 

137,782

 

 

137,987

 

 

139,234

 

Total U.S. Company Owned gross loans receivable

 

 

686,122

 

 

638,729

 

 

 

190,314

 

 

189,183

 

 

186,511

 

Installment loans – Guaranteed by the Company (3)

 

 

51,323

 

 

44,420

 

 

 

46,317

 

 

43,422

 

 

37,093

 

Total U.S. gross combined loans receivable (2)

 

$

737,445

 

$

683,149

 

 

$

236,631

 

$

232,605

 

$

223,604

 

 

 

 

 

 

 

 

 

Lending Revenue:

 

 

 

 

 

 

 

Revolving LOC

 

$

28,145

 

$

26,913

 

 

$

27,911

 

$

27,377

 

$

24,091

 

Installment loans – Company Owned

 

 

121,595

 

 

113,833

 

 

 

56,820

 

 

57,659

 

 

55,918

 

Installment loans – Guaranteed by the Company (3)

 

 

48,283

 

 

48,991

 

 

 

47,348

 

 

43,377

 

 

34,908

 

Total U.S. lending revenue

 

$

198,023

 

$

189,737

 

 

$

132,079

 

$

128,413

 

$

114,917

 

 

 

 

 

 

 

 

 

Lending Provision:

 

 

 

 

 

 

 

Revolving LOC

 

$

11,831

 

$

9,577

 

 

$

11,592

 

$

8,140

 

$

6,621

 

Installment loans – Company Owned

 

 

54,868

 

 

32,962

 

 

 

18,618

 

 

16,792

 

 

14,048

 

Installment loans – Guaranteed by the Company (3)

 

 

28,313

 

 

21,749

 

 

 

25,967

 

 

23,146

 

 

12,583

 

Total U.S. lending provision

 

$

95,012

 

$

64,288

 

 

$

56,177

 

$

48,078

 

$

33,252

 

 

 

 

 

 

 

 

 

NCOs (7)

 

 

 

 

 

 

 

Revolving LOC

 

$

10,248

 

$

10,055

 

 

$

11,481

 

$

8,329

 

$

7,271

 

Installment loans – Company Owned

 

 

40,757

 

 

36,247

 

 

 

19,664

 

 

19,548

 

 

18,617

 

Installment loans – Guaranteed by the Company (3)

 

 

27,395

 

 

21,492

 

 

 

26,065

 

 

21,404

 

 

12,044

 

Total U.S. NCOs

 

$

78,400

 

$

67,794

 

 

$

57,210

 

$

49,281

 

$

37,932

 

 

 

 

 

 

 

 

 

NCO rate (4) (7)

 

 

 

 

 

 

 

Revolving LOC

 

 

19.1

%

 

19.8

%

 

 

22.1

%

 

16.9

%

 

16.0

%

Installment loans – Company Owned

 

 

6.7

%

 

6.0

%

 

 

14.3

%

 

14.1

%

 

13.2

%

Total U.S. Company Owned NCO rate

 

 

7.7

%

 

7.1

%

 

 

16.4

%

 

14.8

%

 

13.9

%

Installment loans – Guaranteed by the Company (3)

 

 

57.2

%

 

47.4

%

 

 

58.1

%

 

53.2

%

 

34.6

%

Total U.S. NCO rate

 

 

11.0

%

 

14.7

%

 

 

24.4

%

 

21.6

%

 

17.2

%

 

 

 

 

 

 

 

 

ALL and CSO Liability for Losses rate (5)

 

 

 

 

 

 

 

Revolving LOC

 

 

25.1

%

 

26.7

%

 

 

25.9

%

 

26.3

%

 

28.9

%

Installment loans – Company Owned

 

 

6.8

%

 

4.2

%

 

 

12.7

%

 

13.4

%

 

15.3

%

Total U.S. Company Owned ALL rate

 

 

8.4

%

 

5.9

%

 

 

16.3

%

 

16.9

%

 

18.7

%

Installment loans – Guaranteed by the Company (3)

 

 

15.7

%

 

16.1

%

 

 

14.9

%

 

16.1

%

 

14.2

%

Total ALL and CSO Liability for Losses rate

 

 

8.9

%

 

6.6

%

 

 

16.0

%

 

16.8

%

 

18.0

%

 

 

 

 

 

 

 

 

Past-due rate (5)

 

 

 

 

 

 

 

Revolving LOC

 

 

29.3

%

 

29.7

%

 

 

30.5

%

 

30.5

%

 

26.6

%

Installment loans – Company Owned

 

 

20.6

%

 

19.1

%

 

 

19.4

%

 

20.1

%

 

18.7

%

Total U.S. Company Owned past-due rate

 

 

21.3

%

 

19.9

%

 

 

22.5

%

 

22.9

%

 

20.7

%

 

 

 

 

 

 

 

 

Installment loans – Guaranteed by the Company (3)

 

 

19.0

%

 

18.5

%

 

 

17.7

%

 

19.8

%

 

17.4

%

(1) On December 27, 2021, we acquired Heights Finance, which accounted for approximately $472 million of U.S. Installment loans as of December 31, 2021. As the period between December 27, 2021 and December 31, 2021 did not result in material loan performance, we have excluded Heights Finance from the table for the fourth quarter of 2021.

(2) Non-GAAP measure. For a description of each non-GAAP metric, see “Non-GAAP Financial Measures.”

(3) Includes loans originated by third-party lenders through CSO programs. Installment gross loans receivable Guaranteed by the Company are not included in the Consolidated Financial Statements.

(4) We calculate NCO rate as total NCOs divided by Average gross loans receivable.

(5) We calculate (i) Allowance for loan losses (ALL) and CSO Liability for losses rate and (ii) past-due rate as the respective totals divided by gross loans receivable at each respective quarter end.

(6) Includes loan balances and activity classified as Held for Sale.

(7) For the first and second quarters of 2022, NCOs presented above include $5.0 million and $10.3 million, respectively, of NCO’s related to the fair value discount, which are excluded from provision.

Contacts

Investor Relations:

Roger Dean

Executive Vice President and Chief Financial Officer

Phone: 844-200-0342

Email: [email protected]

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