Regional Management Corp. Announces Third Quarter 2023 Results
- Net income of $8.8 million and diluted earnings per share of $0.91 for Q3 2023.
- Record revenue of $141 million and a sequential increase in revenue yields of 80 basis points.
- 30+ day contractual delinquency rate of 7.3% as of September 30, 2023.
- Dividend declared for the fourth quarter of 2023 at $0.30 per common share.
- None.
- Net income of
- 30+ day contractual delinquency rate of
- Third quarter ending net receivables of
“With a high-quality portfolio, prudent expense management, and solid execution of our core business, we delivered another set of strong results in the third quarter,” said Robert W. Beck, President and Chief Executive Officer of Regional Management Corp. “We generated
“We remain well-positioned to operate effectively in the current economic cycle,” added Mr. Beck. “We ended the quarter with a 30+ day delinquency rate of
Third Quarter 2023 Highlights
-
Net income for the third quarter of 2023 was
$8.8 million $0.91 -
Net finance receivables as of September 30, 2023 were
$1.8 billion $143.4 million 8.9% , from the prior-year period.-
Large loan net finance receivables of
$1.3 billion $155.4 million 13.9% , from the prior-year period and represented72.6% of the total loan portfolio, compared to69.4% in the prior-year period. -
Small loan net finance receivables were
$474.2 million 1.3% from the prior-year period. -
Total loan originations were
$425.1 million $6.4 million 1.5% , from the prior-year period.
-
Large loan net finance receivables of
-
Total revenue for the third quarter of 2023 was
$140.9 million $9.4 million 7.2% , from the prior-year period.-
Interest and fee income increased
$9.0 million 7.8% , primarily due to higher average net finance receivables. -
Insurance income, net decreased
$0.6 million 5.0% , due to lower premiums.
-
Interest and fee income increased
-
Provision for credit losses for the third quarter of 2023 was
$50.9 million $2.9 million 5.9% , from the prior-year period.-
Annualized net credit losses as a percentage of average net finance receivables for the third quarter of 2023 were
11.0% , compared to9.1% in the prior-year period. -
The provision for credit losses for the third quarter of 2023 included a reserve increase of
$3.5 million -
Allowance for credit losses was
$184.9 million 10.6% of net finance receivables.
-
Annualized net credit losses as a percentage of average net finance receivables for the third quarter of 2023 were
-
As of September 30, 2023, 30+ day contractual delinquencies totaled
$128.4 million 7.3% of net finance receivables, an increase of 10 basis points compared to September 30, 2022. The 30+ day contractual delinquency compares favorably to the company’s$184.9 million -
General and administrative expenses for the third quarter of 2023 were
$62.1 million $3.9 million 6.8% , from the prior-year period. -
The operating expense ratio (annualized general and administrative expenses as a percentage of average net finance receivables) for the third quarter of 2023 was
14.4% , a 50 basis point improvement compared to the prior-year period.
Fourth Quarter 2023 Dividend
The company’s Board of Directors has declared a dividend of
Liquidity and Capital Resources
As of September 30, 2023, the company had net finance receivables of
-
$131.3 million $420 million -
$52.2 million $375 million -
$1.2 billion
As of September 30, 2023, the company’s unused capacity to fund future growth on its revolving credit facilities (subject to the borrowing base) was
The company had a funded debt-to-equity ratio of 4.2 to 1.0 and a stockholders’ equity ratio of
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” online and in branch locations in 19 states across
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: 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 evolving underwriting models and processes, including as to the effectiveness of Regional Management's 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; any future public health crises (including the resurgence of COVID-19), including the impact of such crisis on our operations and financial condition; 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; the impact of changes in tax laws and guidance, 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 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 |
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Consolidated Statements of Income |
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(Unaudited) |
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(dollars in thousands, except per share amounts) |
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Better (Worse) |
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Better (Worse) |
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3Q 23 |
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3Q 22 |
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$ |
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% |
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YTD 23 |
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YTD 22 |
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$ |
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% |
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Revenue |
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Interest and fee income |
|
$ |
125,018 |
|
|
$ |
116,020 |
|
|
$ |
8,998 |
|
|
|
7.8 |
% |
|
$ |
363,508 |
|
|
$ |
333,422 |
|
|
$ |
30,086 |
|
|
|
9.0 |
% |
Insurance income, net |
|
|
11,382 |
|
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|
11,987 |
|
|
|
(605 |
) |
|
|
(5.0 |
)% |
|
|
33,544 |
|
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|
32,751 |
|
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|
793 |
|
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|
2.4 |
% |
Other income |
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|
4,478 |
|
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|
3,445 |
|
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|
1,033 |
|
|
|
30.0 |
% |
|
|
12,688 |
|
|
|
8,998 |
|
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|
3,690 |
|
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|
41.0 |
% |
Total revenue |
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|
140,878 |
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|
131,452 |
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|
9,426 |
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|
7.2 |
% |
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|
409,740 |
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|
375,171 |
|
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|
34,569 |
|
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|
9.2 |
% |
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Expenses |
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Provision for credit losses |
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|
50,930 |
|
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|
48,071 |
|
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|
(2,859 |
) |
|
|
(5.9 |
)% |
|
|
151,149 |
|
|
|
124,329 |
|
|
|
(26,820 |
) |
|
|
(21.6 |
)% |
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Personnel |
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39,832 |
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|
36,979 |
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|
(2,853 |
) |
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|
(7.7 |
)% |
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|
114,848 |
|
|
|
106,574 |
|
|
|
(8,274 |
) |
|
|
(7.8 |
)% |
Occupancy |
|
|
6,315 |
|
|
|
5,848 |
|
|
|
(467 |
) |
|
|
(8.0 |
)% |
|
|
18,761 |
|
|
|
17,812 |
|
|
|
(949 |
) |
|
|
(5.3 |
)% |
Marketing |
|
|
4,077 |
|
|
|
3,940 |
|
|
|
(137 |
) |
|
|
(3.5 |
)% |
|
|
11,300 |
|
|
|
11,139 |
|
|
|
(161 |
) |
|
|
(1.4 |
)% |
Other |
|
|
11,880 |
|
|
|
11,397 |
|
|
|
(483 |
) |
|
|
(4.2 |
)% |
|
|
33,414 |
|
|
|
31,860 |
|
|
|
(1,554 |
) |
|
|
(4.9 |
)% |
Total general and administrative |
|
|
62,104 |
|
|
|
58,164 |
|
|
|
(3,940 |
) |
|
|
(6.8 |
)% |
|
|
178,323 |
|
|
|
167,385 |
|
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|
(10,938 |
) |
|
|
(6.5 |
)% |
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Interest expense |
|
|
16,947 |
|
|
|
11,863 |
|
|
|
(5,084 |
) |
|
|
(42.9 |
)% |
|
|
49,953 |
|
|
|
19,368 |
|
|
|
(30,585 |
) |
|
|
(157.9 |
)% |
Income before income taxes |
|
|
10,897 |
|
|
|
13,354 |
|
|
|
(2,457 |
) |
|
|
(18.4 |
)% |
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|
30,315 |
|
|
|
64,089 |
|
|
|
(33,774 |
) |
|
|
(52.7 |
)% |
Income taxes |
|
|
2,077 |
|
|
|
3,286 |
|
|
|
1,209 |
|
|
|
36.8 |
% |
|
|
6,783 |
|
|
|
15,256 |
|
|
|
8,473 |
|
|
|
55.5 |
% |
Net income |
|
$ |
8,820 |
|
|
$ |
10,068 |
|
|
$ |
(1,248 |
) |
|
|
(12.4 |
)% |
|
$ |
23,532 |
|
|
$ |
48,833 |
|
|
$ |
(25,301 |
) |
|
|
(51.8 |
)% |
Net income per common share: |
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||||||||
Basic |
|
$ |
0.94 |
|
|
$ |
1.09 |
|
|
$ |
(0.15 |
) |
|
|
(13.8 |
)% |
|
$ |
2.51 |
|
|
$ |
5.23 |
|
|
$ |
(2.72 |
) |
|
|
(52.0 |
)% |
Diluted |
|
$ |
0.91 |
|
|
$ |
1.06 |
|
|
$ |
(0.15 |
) |
|
|
(14.2 |
)% |
|
$ |
2.45 |
|
|
$ |
5.01 |
|
|
$ |
(2.56 |
) |
|
|
(51.1 |
)% |
Weighted-average common shares outstanding: |
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Basic |
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|
9,429 |
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|
9,195 |
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|
(234 |
) |
|
|
(2.5 |
)% |
|
|
9,385 |
|
|
|
9,329 |
|
|
|
(56 |
) |
|
|
(0.6 |
)% |
Diluted |
|
|
9,650 |
|
|
|
9,526 |
|
|
|
(124 |
) |
|
|
(1.3 |
)% |
|
|
9,613 |
|
|
|
9,738 |
|
|
|
125 |
|
|
|
1.3 |
% |
Return on average assets (annualized) |
|
|
2.0 |
% |
|
|
2.5 |
% |
|
|
|
|
|
|
|
|
1.8 |
% |
|
|
4.3 |
% |
|
|
|
|
|
|
||||
Return on average equity (annualized) |
|
|
10.8 |
% |
|
|
13.1 |
% |
|
|
|
|
|
|
|
|
9.8 |
% |
|
|
21.7 |
% |
|
|
|
|
|
|
||||
Regional Management Corp. and Subsidiaries |
||||||||||||||||
Consolidated Balance Sheets |
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(Unaudited) |
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(dollars in thousands, except par value amounts) |
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|
|
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|
Increase (Decrease) |
|
|||||||
|
|
3Q 23 |
|
|
3Q 22 |
|
|
$ |
|
|
% |
|
||||
Assets |
|
|
|
|
|
|
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|
||||
Cash |
|
$ |
7,413 |
|
|
$ |
3,140 |
|
|
$ |
4,273 |
|
|
|
136.1 |
% |
Net finance receivables |
|
|
1,751,009 |
|
|
|
1,607,598 |
|
|
|
143,411 |
|
|
|
8.9 |
% |
Unearned insurance premiums |
|
|
(48,764 |
) |
|
|
(49,789 |
) |
|
|
1,025 |
|
|
|
2.1 |
% |
Allowance for credit losses |
|
|
(184,900 |
) |
|
|
(179,800 |
) |
|
|
(5,100 |
) |
|
|
(2.8 |
)% |
Net finance receivables, less unearned insurance premiums and allowance for credit losses |
|
|
1,517,345 |
|
|
|
1,378,009 |
|
|
|
139,336 |
|
|
|
10.1 |
% |
Restricted cash |
|
|
117,029 |
|
|
|
113,865 |
|
|
|
3,164 |
|
|
|
2.8 |
% |
Lease assets |
|
|
34,864 |
|
|
|
30,153 |
|
|
|
4,711 |
|
|
|
15.6 |
% |
Restricted available-for-sale investments |
|
|
22,510 |
|
|
|
20,290 |
|
|
|
2,220 |
|
|
|
10.9 |
% |
Intangible assets |
|
|
15,048 |
|
|
|
11,305 |
|
|
|
3,743 |
|
|
|
33.1 |
% |
Property and equipment |
|
|
14,157 |
|
|
|
12,370 |
|
|
|
1,787 |
|
|
|
14.4 |
% |
Deferred tax assets, net |
|
|
14,140 |
|
|
|
16,836 |
|
|
|
(2,696 |
) |
|
|
(16.0 |
)% |
Other assets |
|
|
22,834 |
|
|
|
20,582 |
|
|
|
2,252 |
|
|
|
10.9 |
% |
Total assets |
|
$ |
1,765,340 |
|
|
$ |
1,606,550 |
|
|
$ |
158,790 |
|
|
|
9.9 |
% |
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
|
|
|
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|
||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Debt |
|
$ |
1,372,748 |
|
|
$ |
1,241,039 |
|
|
$ |
131,709 |
|
|
|
10.6 |
% |
Unamortized debt issuance costs |
|
|
(5,647 |
) |
|
|
(9,647 |
) |
|
|
4,000 |
|
|
|
41.5 |
% |
Net debt |
|
|
1,367,101 |
|
|
|
1,231,392 |
|
|
|
135,709 |
|
|
|
11.0 |
% |
Lease liabilities |
|
|
37,095 |
|
|
|
32,468 |
|
|
|
4,627 |
|
|
|
14.3 |
% |
Accounts payable and accrued expenses |
|
|
30,559 |
|
|
|
34,237 |
|
|
|
(3,678 |
) |
|
|
(10.7 |
)% |
Total liabilities |
|
|
1,434,755 |
|
|
|
1,298,097 |
|
|
|
136,658 |
|
|
|
10.5 |
% |
Stockholders’ equity: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Preferred stock ( |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Common stock ( |
|
|
1,464 |
|
|
|
1,439 |
|
|
|
25 |
|
|
|
1.7 |
% |
Additional paid-in capital |
|
|
119,507 |
|
|
|
111,530 |
|
|
|
7,977 |
|
|
|
7.2 |
% |
Retained earnings |
|
|
360,155 |
|
|
|
346,083 |
|
|
|
14,072 |
|
|
|
4.1 |
% |
Accumulated other comprehensive loss |
|
|
(398 |
) |
|
|
(456 |
) |
|
|
58 |
|
|
|
12.7 |
% |
Treasury stock (4,807 shares at September 30, 2023 and 4,807 shares at September 30, 2022) |
|
|
(150,143 |
) |
|
|
(150,143 |
) |
|
|
— |
|
|
|
— |
|
Total stockholders’ equity |
|
|
330,585 |
|
|
|
308,453 |
|
|
|
22,132 |
|
|
|
7.2 |
% |
Total liabilities and stockholders’ equity |
|
$ |
1,765,340 |
|
|
$ |
1,606,550 |
|
|
$ |
158,790 |
|
|
|
9.9 |
% |
Regional Management Corp. and Subsidiaries |
||||||||||||||||||||||||||||
Selected Financial Data |
||||||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||||||
(dollars in thousands, except per share amounts) |
||||||||||||||||||||||||||||
|
|
Net Finance Receivables |
|
|||||||||||||||||||||||||
|
|
3Q 23 |
|
|
2Q 23 |
|
|
QoQ $
|
|
|
QoQ %
|
|
|
3Q 22 |
|
|
YoY $
|
|
|
YoY %
|
|
|||||||
Small loans |
|
$ |
474,181 |
|
|
$ |
444,590 |
|
|
$ |
29,591 |
|
|
|
6.7 |
% |
|
$ |
480,199 |
|
|
$ |
(6,018 |
) |
|
|
(1.3 |
)% |
Large loans |
|
|
1,271,891 |
|
|
|
1,238,031 |
|
|
|
33,860 |
|
|
|
2.7 |
% |
|
|
1,116,455 |
|
|
|
155,436 |
|
|
|
13.9 |
% |
Retail loans |
|
|
4,937 |
|
|
|
6,316 |
|
|
|
(1,379 |
) |
|
|
(21.8 |
)% |
|
|
10,944 |
|
|
|
(6,007 |
) |
|
|
(54.9 |
)% |
Total net finance receivables |
|
$ |
1,751,009 |
|
|
$ |
1,688,937 |
|
|
$ |
62,072 |
|
|
|
3.7 |
% |
|
$ |
1,607,598 |
|
|
$ |
143,411 |
|
|
|
8.9 |
% |
Number of branches at period end |
|
|
347 |
|
|
|
347 |
|
|
|
— |
|
|
|
— |
|
|
|
338 |
|
|
|
9 |
|
|
|
2.7 |
% |
Net finance receivables per branch |
|
$ |
5,046 |
|
|
$ |
4,867 |
|
|
$ |
179 |
|
|
|
3.7 |
% |
|
$ |
4,756 |
|
|
$ |
290 |
|
|
|
6.1 |
% |
|
|
Averages and Yields |
|
|||||||||||||||||||||
|
|
3Q 23 |
|
|
2Q 23 |
|
|
3Q 22 |
|
|||||||||||||||
|
|
Average Net
|
|
|
Average
|
|
|
Average Net
|
|
|
Average
|
|
|
Average Net
|
|
|
Average
|
|
||||||
Small loans |
|
$ |
459,320 |
|
|
|
36.6 |
% |
|
$ |
443,601 |
|
|
|
34.5 |
% |
|
$ |
466,087 |
|
|
|
35.5 |
% |
Large loans |
|
|
1,257,168 |
|
|
|
26.3 |
% |
|
|
1,223,339 |
|
|
|
26.0 |
% |
|
|
1,089,225 |
|
|
|
27.2 |
% |
Retail loans |
|
|
5,647 |
|
|
|
16.9 |
% |
|
|
7,191 |
|
|
|
16.6 |
% |
|
|
10,935 |
|
|
|
18.5 |
% |
Total interest and fee yield |
|
$ |
1,722,135 |
|
|
|
29.0 |
% |
|
$ |
1,674,131 |
|
|
|
28.2 |
% |
|
$ |
1,566,247 |
|
|
|
29.6 |
% |
Total revenue yield |
|
$ |
1,722,135 |
|
|
|
32.7 |
% |
|
$ |
1,674,131 |
|
|
|
31.9 |
% |
|
$ |
1,566,247 |
|
|
|
33.6 |
% |
(1) |
Annualized interest and fee income as a percentage of average net finance receivables. |
|
|
Components of Increase in Interest and Fee Income |
|
|||||||||||||
|
|
3Q 23 Compared to 3Q 22 |
|
|||||||||||||
|
|
Increase (Decrease) |
|
|||||||||||||
|
|
Volume |
|
|
Rate |
|
|
Volume & Rate |
|
|
Total |
|
||||
Small loans |
|
$ |
(601 |
) |
|
$ |
1,260 |
|
|
$ |
(18 |
) |
|
$ |
641 |
|
Large loans |
|
|
11,428 |
|
|
|
(2,428 |
) |
|
|
(375 |
) |
|
|
8,625 |
|
Retail loans |
|
|
(245 |
) |
|
|
(45 |
) |
|
|
22 |
|
|
|
(268 |
) |
Product mix |
|
|
965 |
|
|
|
(1,106 |
) |
|
|
141 |
|
|
|
— |
|
Total increase in interest and fee income |
|
$ |
11,547 |
|
|
$ |
(2,319 |
) |
|
$ |
(230 |
) |
|
$ |
8,998 |
|
|
|
Loans Originated (1) |
|
|||||||||||||||||||||||||
|
|
3Q 23 |
|
|
2Q 23 |
|
|
QoQ $
|
|
|
QoQ %
|
|
|
3Q 22 |
|
|
YoY $
|
|
|
YoY %
|
|
|||||||
Small loans |
|
$ |
173,074 |
|
|
$ |
149,460 |
|
|
$ |
23,614 |
|
|
|
15.8 |
% |
|
$ |
173,269 |
|
|
$ |
(195 |
) |
|
|
(0.1 |
)% |
Large loans |
|
|
251,999 |
|
|
|
249,514 |
|
|
|
2,485 |
|
|
|
1.0 |
% |
|
|
243,259 |
|
|
|
8,740 |
|
|
|
3.6 |
% |
Retail loans |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,145 |
|
|
|
(2,145 |
) |
|
|
(100.0 |
)% |
Total loans originated |
|
$ |
425,073 |
|
|
$ |
398,974 |
|
|
$ |
26,099 |
|
|
|
6.5 |
% |
|
$ |
418,673 |
|
|
$ |
6,400 |
|
|
|
1.5 |
% |
(1) |
Represents the principal balance of loan originations and refinancings. |
|
|
Other Key Metrics |
|
|||||||||
|
|
3Q 23 |
|
|
2Q 23 |
|
|
3Q 22 |
|
|||
Net credit losses |
|
$ |
47,430 |
|
|
$ |
54,951 |
|
|
$ |
35,771 |
|
Percentage of average net finance receivables (annualized) |
|
|
11.0 |
% |
|
|
13.1 |
% |
|
|
9.1 |
% |
Provision for credit losses |
|
$ |
50,930 |
|
|
$ |
52,551 |
|
|
$ |
48,071 |
|
Percentage of average net finance receivables (annualized) |
|
|
11.8 |
% |
|
|
12.6 |
% |
|
|
12.3 |
% |
Percentage of total revenue |
|
|
36.2 |
% |
|
|
39.4 |
% |
|
|
36.6 |
% |
General and administrative expenses |
|
$ |
62,104 |
|
|
$ |
56,896 |
|
|
$ |
58,164 |
|
Percentage of average net finance receivables (annualized) |
|
|
14.4 |
% |
|
|
13.6 |
% |
|
|
14.9 |
% |
Percentage of total revenue |
|
|
44.1 |
% |
|
|
42.6 |
% |
|
|
44.2 |
% |
Same store results (1): |
|
|
|
|
|
|
|
|
|
|||
Net finance receivables at period-end |
|
$ |
1,684,757 |
|
|
$ |
1,636,131 |
|
|
$ |
1,552,740 |
|
Net finance receivable growth rate |
|
|
4.9 |
% |
|
|
7.2 |
% |
|
|
19.2 |
% |
Number of branches in calculation |
|
|
330 |
|
|
|
329 |
|
|
|
315 |
|
| (1) | 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 |
|
|||||||||||||||||||||
|
|
3Q 23 |
|
|
2Q 23 |
|
|
3Q 22 |
|
|||||||||||||||
Allowance for credit losses |
|
$ |
184,900 |
|
|
|
10.6 |
% |
|
$ |
181,400 |
|
|
|
10.7 |
% |
|
$ |
179,800 |
|
|
|
11.2 |
% |
Current |
|
|
1,472,931 |
|
|
|
84.2 |
% |
|
|
1,433,787 |
|
|
|
84.9 |
% |
|
|
1,356,134 |
|
|
|
84.4 |
% |
1 to 29 days past due |
|
|
149,648 |
|
|
|
8.5 |
% |
|
|
138,810 |
|
|
|
8.2 |
% |
|
|
135,468 |
|
|
|
8.4 |
% |
Delinquent accounts: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
30 to 59 days |
|
|
36,502 |
|
|
|
2.1 |
% |
|
|
33,676 |
|
|
|
2.0 |
% |
|
|
32,295 |
|
|
|
2.0 |
% |
60 to 89 days |
|
|
28,130 |
|
|
|
1.6 |
% |
|
|
24,931 |
|
|
|
1.5 |
% |
|
|
25,375 |
|
|
|
1.6 |
% |
90 to 119 days |
|
|
23,420 |
|
|
|
1.3 |
% |
|
|
20,041 |
|
|
|
1.1 |
% |
|
|
21,720 |
|
|
|
1.3 |
% |
120 to 149 days |
|
|
21,309 |
|
|
|
1.2 |
% |
|
|
18,087 |
|
|
|
1.1 |
% |
|
|
17,503 |
|
|
|
1.1 |
% |
150 to 179 days |
|
|
19,069 |
|
|
|
1.1 |
% |
|
|
19,605 |
|
|
|
1.2 |
% |
|
|
19,103 |
|
|
|
1.2 |
% |
Total contractual delinquency |
|
$ |
128,430 |
|
|
|
7.3 |
% |
|
$ |
116,340 |
|
|
|
6.9 |
% |
|
$ |
115,996 |
|
|
|
7.2 |
% |
Total net finance receivables |
|
$ |
1,751,009 |
|
|
|
100.0 |
% |
|
$ |
1,688,937 |
|
|
|
100.0 |
% |
|
$ |
1,607,598 |
|
|
|
100.0 |
% |
1 day and over past due |
|
$ |
278,078 |
|
|
|
15.8 |
% |
|
$ |
255,150 |
|
|
|
15.1 |
% |
|
$ |
251,464 |
|
|
|
15.6 |
% |
|
|
Contractual Delinquency by Product |
|
|||||||||||||||||||||
|
|
3Q 23 |
|
|
2Q 23 |
|
|
3Q 22 |
|
|||||||||||||||
Small loans |
|
$ |
45,438 |
|
|
|
9.6 |
% |
|
$ |
40,894 |
|
|
|
9.2 |
% |
|
$ |
49,906 |
|
|
|
10.4 |
% |
Large loans |
|
|
82,256 |
|
|
|
6.5 |
% |
|
|
74,637 |
|
|
|
6.0 |
% |
|
|
64,922 |
|
|
|
5.8 |
% |
Retail loans |
|
|
736 |
|
|
|
14.9 |
% |
|
|
809 |
|
|
|
12.8 |
% |
|
|
1,168 |
|
|
|
10.7 |
% |
Total contractual delinquency |
|
$ |
128,430 |
|
|
|
7.3 |
% |
|
$ |
116,340 |
|
|
|
6.9 |
% |
|
$ |
115,996 |
|
|
|
7.2 |
% |
|
|
Income Statement Quarterly Trend |
|
|||||||||||||||||||||||||
|
|
3Q 22 |
|
|
4Q 22 |
|
|
1Q 23 |
|
|
2Q 23 |
|
|
3Q 23 |
|
|
QoQ $
|
|
|
YoY $
|
|
|||||||
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Interest and fee income |
|
$ |
116,020 |
|
|
$ |
117,432 |
|
|
$ |
120,407 |
|
|
$ |
118,083 |
|
|
$ |
125,018 |
|
|
$ |
6,935 |
|
|
$ |
8,998 |
|
Insurance income, net |
|
|
11,987 |
|
|
|
10,751 |
|
|
|
10,959 |
|
|
|
11,203 |
|
|
|
11,382 |
|
|
|
179 |
|
|
|
(605 |
) |
Other income |
|
|
3,445 |
|
|
|
3,833 |
|
|
|
4,012 |
|
|
|
4,198 |
|
|
|
4,478 |
|
|
|
280 |
|
|
|
1,033 |
|
Total revenue |
|
|
131,452 |
|
|
|
132,016 |
|
|
|
135,378 |
|
|
|
133,484 |
|
|
|
140,878 |
|
|
|
7,394 |
|
|
|
9,426 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Provision for credit losses |
|
|
48,071 |
|
|
|
60,786 |
|
|
|
47,668 |
|
|
|
52,551 |
|
|
|
50,930 |
|
|
|
1,621 |
|
|
|
(2,859 |
) |
Personnel |
|
|
36,979 |
|
|
|
34,669 |
|
|
|
38,597 |
|
|
|
36,419 |
|
|
|
39,832 |
|
|
|
(3,413 |
) |
|
|
(2,853 |
) |
Occupancy |
|
|
5,848 |
|
|
|
5,997 |
|
|
|
6,288 |
|
|
|
6,158 |
|
|
|
6,315 |
|
|
|
(157 |
) |
|
|
(467 |
) |
Marketing |
|
|
3,940 |
|
|
|
4,239 |
|
|
|
3,379 |
|
|
|
3,844 |
|
|
|
4,077 |
|
|
|
(233 |
) |
|
|
(137 |
) |
Other |
|
|
11,397 |
|
|
|
10,238 |
|
|
|
11,059 |
|
|
|
10,475 |
|
|
|
11,880 |
|
|
|
(1,405 |
) |
|
|
(483 |
) |
Total general and administrative |
|
|
58,164 |
|
|
|
55,143 |
|
|
|
59,323 |
|
|
|
56,896 |
|
|
|
62,104 |
|
|
|
(5,208 |
) |
|
|
(3,940 |
) |
Interest expense |
|
|
11,863 |
|
|
|
14,855 |
|
|
|
16,782 |
|
|
|
16,224 |
|
|
|
16,947 |
|
|
|
(723 |
) |
|
|
(5,084 |
) |
Income before income taxes |
|
|
13,354 |
|
|
|
1,232 |
|
|
|
11,605 |
|
|
|
7,813 |
|
|
|
10,897 |
|
|
|
3,084 |
|
|
|
(2,457 |
) |
Income taxes |
|
|
3,286 |
|
|
|
(1,159 |
) |
|
|
2,916 |
|
|
|
1,790 |
|
|
|
2,077 |
|
|
|
(287 |
) |
|
|
1,209 |
|
Net income |
|
$ |
10,068 |
|
|
$ |
2,391 |
|
|
$ |
8,689 |
|
|
$ |
6,023 |
|
|
$ |
8,820 |
|
|
$ |
2,797 |
|
|
$ |
(1,248 |
) |
Net income per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
|
$ |
1.09 |
|
|
$ |
0.26 |
|
|
$ |
0.93 |
|
|
$ |
0.64 |
|
|
$ |
0.94 |
|
|
$ |
0.30 |
|
|
$ |
(0.15 |
) |
Diluted |
|
$ |
1.06 |
|
|
$ |
0.25 |
|
|
$ |
0.90 |
|
|
$ |
0.63 |
|
|
$ |
0.91 |
|
|
$ |
0.28 |
|
|
$ |
(0.15 |
) |
Weighted-average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Basic |
|
|
9,195 |
|
|
|
9,199 |
|
|
|
9,325 |
|
|
|
9,399 |
|
|
|
9,429 |
|
|
|
(30 |
) |
|
|
(234 |
) |
Diluted |
|
|
9,526 |
|
|
|
9,411 |
|
|
|
9,622 |
|
|
|
9,566 |
|
|
|
9,650 |
|
|
|
(84 |
) |
|
|
(124 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
Balance Sheet Quarterly Trend |
|
|||||||||||||||||||||||||
|
|
3Q 22 |
|
|
4Q 22 |
|
|
1Q 23 |
|
|
2Q 23 |
|
|
3Q 23 |
|
|
QoQ $
|
|
|
YoY $
|
|
|||||||
Total assets |
|
$ |
1,606,550 |
|
|
$ |
1,724,987 |
|
|
$ |
1,701,114 |
|
|
$ |
1,723,616 |
|
|
$ |
1,765,340 |
|
|
$ |
41,724 |
|
|
$ |
158,790 |
|
Net finance receivables |
|
$ |
1,607,598 |
|
|
$ |
1,699,393 |
|
|
$ |
1,676,230 |
|
|
$ |
1,688,937 |
|
|
$ |
1,751,009 |
|
|
$ |
62,072 |
|
|
$ |
143,411 |
|
Allowance for credit losses |
|
$ |
179,800 |
|
|
$ |
178,800 |
|
|
$ |
183,800 |
|
|
$ |
181,400 |
|
|
$ |
184,900 |
|
|
$ |
3,500 |
|
|
$ |
5,100 |
|
Debt |
|
$ |
1,241,039 |
|
|
$ |
1,355,359 |
|
|
$ |
1,329,677 |
|
|
$ |
1,344,855 |
|
|
$ |
1,372,748 |
|
|
$ |
27,893 |
|
|
$ |
131,709 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
Other Key Metrics Quarterly Trend |
|
|||||||||||||||||||||||||
|
|
3Q 22 |
|
|
4Q 22 |
|
|
1Q 23 |
|
|
2Q 23 |
|
|
3Q 23 |
|
|
QoQ
|
|
|
YoY
|
|
|||||||
Interest and fee yield (annualized) |
|
|
29.6 |
% |
|
|
28.5 |
% |
|
|
28.5 |
% |
|
|
28.2 |
% |
|
|
29.0 |
% |
|
|
0.8 |
% |
|
|
(0.6 |
)% |
Efficiency ratio (1) |
|
|
44.2 |
% |
|
|
41.8 |
% |
|
|
43.8 |
% |
|
|
42.6 |
% |
|
|
44.1 |
% |
|
|
1.5 |
% |
|
|
(0.1 |
)% |
Operating expense ratio (2) |
|
|
14.9 |
% |
|
|
13.4 |
% |
|
|
14.0 |
% |
|
|
13.6 |
% |
|
|
14.4 |
% |
|
|
0.8 |
% |
|
|
(0.5 |
)% |
30+ contractual delinquency |
|
|
7.2 |
% |
|
|
7.1 |
% |
|
|
7.2 |
% |
|
|
6.9 |
% |
|
|
7.3 |
% |
|
|
0.4 |
% |
|
|
0.1 |
% |
Net credit loss ratio (3) |
|
|
9.1 |
% |
|
|
15.0 |
% |
|
|
10.1 |
% |
|
|
13.1 |
% |
|
|
11.0 |
% |
|
|
(2.1 |
)% |
|
|
1.9 |
% |
Book value per share |
|
$ |
32.18 |
|
|
$ |
32.41 |
|
|
$ |
33.06 |
|
|
$ |
32.71 |
|
|
$ |
33.61 |
|
|
$ |
0.90 |
|
|
$ |
1.43 |
|
(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 |
|
|||||||||||||
|
|
YTD 23 |
|
|
YTD 22 |
|
||||||||||
|
|
Average Net Finance
|
|
|
Average
|
|
|
Average Net Finance
|
|
|
Average
|
|
||||
Small loans |
|
$ |
456,893 |
|
|
|
35.4 |
% |
|
$ |
448,175 |
|
|
|
35.8 |
% |
Large loans |
|
|
1,232,170 |
|
|
|
26.1 |
% |
|
|
1,032,273 |
|
|
|
27.4 |
% |
Retail loans |
|
|
7,252 |
|
|
|
17.5 |
% |
|
|
10,796 |
|
|
|
18.4 |
% |
Total interest and fee yield |
|
$ |
1,696,315 |
|
|
|
28.6 |
% |
|
$ |
1,491,244 |
|
|
|
29.8 |
% |
Total revenue yield |
|
$ |
1,696,315 |
|
|
|
32.2 |
% |
|
$ |
1,491,244 |
|
|
|
33.5 |
% |
(1) |
Annualized interest and fee income as a percentage of average net finance receivables. |
|
|
Components of Increase in Interest and Fee Income |
|
|||||||||||||
|
|
YTD 23 Compared to YTD 22 |
|
|||||||||||||
|
|
Increase (Decrease) |
|
|||||||||||||
|
|
Volume |
|
|
Rate |
|
|
Volume & Rate |
|
|
Total |
|
||||
Small loans |
|
$ |
2,338 |
|
|
$ |
(1,208 |
) |
|
$ |
(24 |
) |
|
$ |
1,106 |
|
Large loans |
|
|
41,004 |
|
|
|
(9,624 |
) |
|
|
(1,864 |
) |
|
|
29,516 |
|
Retail loans |
|
|
(488 |
) |
|
|
(71 |
) |
|
|
23 |
|
|
|
(536 |
) |
Product mix |
|
|
2,997 |
|
|
|
(2,956 |
) |
|
|
(41 |
) |
|
|
— |
|
Total increase in interest and fee income |
|
$ |
45,851 |
|
|
$ |
(13,859 |
) |
|
$ |
(1,906 |
) |
|
$ |
30,086 |
|
|
|
Loans Originated (1) |
|
|||||||||||||
|
|
YTD 23 |
|
|
YTD 22 |
|
|
YTD $
|
|
|
YTD %
|
|
||||
Small loans |
|
$ |
432,018 |
|
|
$ |
481,644 |
|
|
$ |
(49,626 |
) |
|
|
(10.3 |
)% |
Large loans |
|
|
695,084 |
|
|
|
682,110 |
|
|
|
12,974 |
|
|
|
1.9 |
% |
Retail loans |
|
|
146 |
|
|
|
7,206 |
|
|
|
(7,060 |
) |
|
|
(98.0 |
)% |
Total loans originated |
|
$ |
1,127,248 |
|
|
$ |
1,170,960 |
|
|
$ |
(43,712 |
) |
|
|
(3.7 |
)% |
(1) |
Represents the principal balance of loan originations and refinancings. |
|
|
Other Key Metrics |
|
|||||
|
|
YTD 23 |
|
|
YTD 22 |
|
||
Net credit losses |
|
$ |
145,049 |
|
|
$ |
103,829 |
|
Percentage of average net finance receivables (annualized) |
|
|
11.4 |
% |
|
|
9.3 |
% |
Provision for credit losses |
|
$ |
151,149 |
|
|
$ |
124,329 |
|
Percentage of average net finance receivables (annualized) |
|
|
11.9 |
% |
|
|
11.1 |
% |
Percentage of total revenue |
|
|
36.9 |
% |
|
|
33.1 |
% |
General and administrative expenses |
|
$ |
178,323 |
|
|
$ |
167,385 |
|
Percentage of average net finance receivables (annualized) |
|
|
14.0 |
% |
|
|
15.0 |
% |
Percentage of total revenue |
|
|
43.5 |
% |
|
|
44.6 |
% |
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 the 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.
|
|
3Q 23 |
|
|
Debt |
|
$ |
1,372,748 |
|
Total stockholders' equity |
|
|
330,585 |
|
Less: Intangible assets |
|
|
15,048 |
|
Tangible equity (non-GAAP) |
|
$ |
315,537 |
|
Funded debt-to-equity ratio |
|
|
4.2 |
x |
Funded debt-to-tangible equity ratio (non-GAAP) |
|
|
4.4 |
x |
View source version on businesswire.com: https://www.businesswire.com/news/home/20231101241638/en/
Investor Relations
Garrett Edson, (203) 682-8331
investor.relations@regionalmanagement.com
Source: Regional Management Corp.
FAQ
What were the net income and diluted earnings per share for Regional Management Corp. in Q3 2023?
What was the 30+ day contractual delinquency rate for Regional Management Corp. as of September 30, 2023?
What dividend was declared by Regional Management Corp. for the fourth quarter of 2023?
