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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) 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.
Consumer Portfolio Services (CPSS) reported a significant rise in third-quarter earnings for 2021, achieving net income of $13.7 million or $0.52 per diluted share, a 232% increase from the prior year. The company's pretax income soared to $19.5 million, up from $5.9 million in Q3 2020. However, total revenues decreased to $68.6 million, down from $70.7 million year-over-year. New contract purchases reached $327 million, a 14% rise compared to the previous quarter. CPS also repurchased approximately 2 million shares of its common stock, reaffirming its commitment to shareholders.
Consumer Portfolio Services (CPSS) will host a conference call on October 28, 2021, at 1:00 p.m. ET to discuss its third quarter 2021 operating results. Participants can join via phone by calling 877-312-5502 (international: 253-237-1131) about 10 minutes prior. The call will be available for replay from October 28 to November 4, 2021, using the same conference ID 9262788. Investors can also access a live broadcast via the company’s website and on-demand for 90 days post-call.
Consumer Portfolio Services, Inc. (CPSS) reported a net income of $9.7 million, or $0.39 per diluted share, for Q2 2021, up from $3.0 million in Q2 2020. The pretax income soared by 199% to $13.9 million. However, total revenues fell to $66.8 million, slightly down from $67.3 million in the same quarter last year. Year-to-date revenues decreased by 5.9% to $129.9 million, but total expenses dropped significantly by 17.1% to $108.1 million in the six months ended June 30, 2021. New contract purchases reached $286 million, a 39% increase over Q1 2021.
Consumer Portfolio Services, Inc. (Nasdaq: CPSS) announced a conference call scheduled for August 12, 2021, at 1:00 p.m. ET to discuss its Q2 2021 operating results. Participants can dial in to join the call and a replay will be available from August 12 to August 19, 2021. CPS specializes in indirect automobile financing, primarily focusing on individuals with credit challenges by purchasing retail installment sales contracts from franchised dealerships. The company funds contract purchases mainly through securitization markets.
Consumer Portfolio Services (CPSS) announced the closing of its third term securitization in 2021, marking its 40th senior subordinate securitization since 2011. This transaction involved the sale of $291 million in asset-backed notes secured by $300 million in automobile receivables. Notably, it is the 23rd consecutive securitization to receive a triple 'A' rating from at least two agencies. The weighted average coupon on the notes is approximately 1.55%. The transaction enhances CPS's financing for future receivables, with a pre-funding structure in place.
Consumer Portfolio Services (CPSS) reported a net income of $5.2 million, or $0.21 per diluted share, for Q1 2021, reflecting a significant decrease from $10.8 million or $0.45 per diluted share in Q1 2020. Revenues declined by 10.8% to $63.1 million, down from $70.8 million a year earlier. However, pretax income rose 155.3% to $7.9 million. The company purchased $205 million in new contracts, showcasing a robust recovery in originations. Charge-offs decreased to 6.3% of the average portfolio, and delinquencies improved to 7.77%.
Consumer Portfolio Services, Inc. (Nasdaq: CPSS) has announced a conference call scheduled for May 11, 2021, at 1:00 p.m. ET to discuss its first quarter 2021 operating results. Interested participants can join by calling 877 312-5502 or 253 237-1131 for international calls, with a conference ID of 7645419. A replay will be available from May 11 to May 18, with dial-in numbers provided for both domestic and international listeners. The call will also be broadcast live on the company's website.
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