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Consumer Portfolio Services Inc (CPSS) is a specialized finance company dedicated to providing indirect automobile financing to individuals who face challenges such as past credit problems, low incomes, or limited credit histories. Founded in 1991, the company has built a robust portfolio by purchasing retail installment sales contracts from automobile dealerships. These contracts are primarily secured by late-model used vehicles, with a minor portion involving new vehicles.
The company's core business involves acquiring these contracts from franchised and select independent dealerships across the United States. By doing so, CPSS offers an alternative financing solution for customers who are often referred to as sub-prime due to their credit profiles. This approach not only aids consumers in securing vehicle financing but also supports dealerships in closing sales that might otherwise be unattainable.
CPSS funds its contract purchases primarily through the securitization markets, ensuring long-term stability and sustainability. The company then services these contracts over their entire lifespan, maintaining a steady revenue stream and fostering lasting relationships with its customers. As of June 2015, CPSS has purchased over $11.8 billion in contracts and is currently servicing a managed portfolio worth approximately $1.8 billion, encompassing around 140,000 customers.
Headquartered in Irvine, California, CPSS operates additional servicing branches in Florida, Illinois, Nevada, and Virginia, strategically positioned to optimize operational efficiency and customer service. With a dedicated workforce of approximately 900 employees and dealer relationships spanning across 48 states, CPSS stands as a significant player in the U.S. specialty finance sector.
Consumer Portfolio Services (Nasdaq: CPSS) announced an increase in its credit agreement with Ares Agent Services, raising its capacity from $100 million to $200 million. This amended agreement allows CPS to secure loans against automobile receivables that it holds or will originate in the future. CPS can borrow on a revolving basis until January 31, 2024, with the option for repayment or amortization until January 31, 2028. The company specializes in indirect automobile financing for individuals with credit challenges.
Consumer Portfolio Services (Nasdaq: CPSS) announced the successful closing of its second term securitization in 2022, marking its 43rd overall since 2011. The securitization involved $395.6 million in asset-backed notes backed by $430 million in automobile receivables. This transaction received a triple ‘A’ rating from major agencies and features a weighted average coupon of approximately 4.83%. Additionally, the initial credit enhancement includes a cash deposit and overcollateralization. CPS aims to sell an additional $144.2 million of receivables in May 2022.
Consumer Portfolio Services, Inc. (CPSS) reported its best quarterly results since inception, with a net income of $21.1 million, or $0.75 per diluted share, for Q1 2022, up from $5.2 million in Q1 2021. Revenues increased by 17.8% to $74.4 million, while operating expenses decreased by 18.4% to $45.0 million. Notably, the company purchased $410 million in new contracts, a record high. Despite a rise in delinquencies to 8.52%, annualized net charge-offs improved to 3.3%. The strong metrics in credit performance boost the company's outlook for 2022.
Consumer Portfolio Services (Nasdaq: CPSS) announced a conference call scheduled for April 19, 2022, at 1:00 p.m. ET to discuss its Q1 2022 operating results. Participants can join by calling 877-312-5502 (international: 253-237-1131), with a replay available until April 26, 2022. The company specializes in indirect auto financing for individuals with credit challenges, purchasing retail installment sales contracts from dealerships, primarily funded through securitization markets.
Consumer Portfolio Services, Inc. (Nasdaq: CPSS) announced the nomination of Stephen H. Deckoff and James E. Walker III for election to its Board of Directors. This recommendation follows discussions with Black Diamond Capital Management, which owns approximately 22% of CPSS's outstanding shares. CEO Charles E. Bradley, Jr. endorsed the nominees, citing his long-standing acquaintance with them. The annual shareholders' meeting is anticipated in July 2022, with further details to be disclosed in the upcoming proxy materials.
Consumer Portfolio Services (CPSS) reported strong financial results for Q4 2021, with net income of $19.0 million ($0.71 per diluted share), up from $4.1 million ($0.17) in Q4 2020. Q4 revenues increased 11.1% to $69.4 million. Total operating expenses dropped 19.5% to $202.1 million for the year, leading to a pretax income of $65.7 million. New contract purchases reached $1.146 billion for 2021, a 54% increase year-over-year. The company also noted improved credit performance, with annualized net charge-offs at 2.57% compared to 5.18% in Q4 2020.
Consumer Portfolio Services (CPSS) announced a conference call on February 15, 2022, at 1:00 p.m. ET to discuss Q4 2021 operating results. Participants can join by calling 877 312-5502 (international: 253 237-1131) about 10 minutes before the start time, using conference ID 9319729. A replay will be available from February 15 to February 22, 2022, by calling 855 859-2056 (international: 404 537-3406). The call will also be streamed live on the company’s website, www.consumerportfolio.com.
Consumer Portfolio Services (Nasdaq: CPSS) has announced the renewal of its two-year revolving credit agreement with Ares Agent Services, effective February 2, 2022. This agreement allows CPS to secure loans backed by automobile receivables, with borrowing available until January 31, 2024. Post-revolving period, CPS has options for full repayment or amortization until January 31, 2028. The CEO, Charles E. Bradley, Jr., stated the renewal aligns with the company's strategy of maintaining substantial warehouse lines.
Consumer Portfolio Services (Nasdaq: CPSS) has successfully closed its first term securitization of 2022, marking its 42nd senior subordinate securitization since 2011. The transaction involved the sale of $316.8 million in asset-backed notes, backed by $330.0 million in automobile receivables. The notes received a triple “A” rating from two agencies and are structured with five classes of notes, featuring an average coupon rate of approximately 2.54%. Additionally, the securitization includes credit enhancements to support principal payments.
Consumer Portfolio Services (CPSS) has successfully closed its fourth term securitization in 2021, marking its 41st since 2011. The transaction involved the sale of $349.2 million in asset-backed notes backed by $360.0 million of automobile receivables. All notes received a triple 'A' rating from Moody's and DBRS Morningstar. The weighted average coupon on the notes is approximately 2.09%, and the transaction features initial credit enhancements of 4.00%. A pre-funding structure allows for the sale of additional receivables, facilitating long-term financing.
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