Upbound Group, Inc. Reports Fourth Quarter and Full Year 2023 Results

Rhea-AI Summary

Upbound Group, Inc. (UPBD) reported total revenue of $1,018 million for the fourth quarter and $4 billion for the full year. The GAAP diluted EPS was $(0.21) for the fourth quarter and $(0.09) for the full year, while the non-GAAP diluted EPS stood at $0.81 for the fourth quarter and $3.55 for the full year. The company's CEO and CFO will host a conference call to discuss the financial results and outlook for 2024.

Insights

Financial Analyst

Examining Upbound Group, Inc.'s reported total revenue of $1,018 million for the fourth quarter and $4 billion for the full year reveals a significant financial milestone for the company. The reported non-GAAP diluted EPS of $0.81 for the fourth quarter and $3.55 for the full year indicates a robust profitability metric that investors often scrutinize. It's essential to dissect the non-GAAP figures as they exclude certain items that may be viewed as non-recurring or not indicative of the company's ongoing operations, such as restructuring costs or asset impairments.

From a financial perspective, the reported GAAP diluted EPS of $(0.21) for the fourth quarter and $(0.09) for the full year suggests that when including all financial items, the company may have incurred expenses or losses that impacted its net income. This discrepancy between GAAP and non-GAAP EPS warrants a closer look into the nature of these expenses. It is also important to consider the company's forward-looking statements and 2024 outlook provided during the earnings call, as this can influence investor sentiment and future stock performance.

Market Research Analyst

Upbound Group's performance should be contextualized within its industry and the broader market trends. A revenue of $4 billion positions the company in its competitive landscape and may reflect market share dynamics. The revenue growth rate, when compared to previous years, can signal the company's operational efficiency and market demand for its products or services. Additionally, the timing of the earnings call and the provision of a 2024 outlook is strategic, as it helps set market expectations and can impact stock volatility.

Investors and analysts will likely be interested in the underlying drivers of revenue, such as new customer acquisitions, product mix and pricing power. The company's ability to manage costs and improve margins will also be a focal point, especially in an environment where economic indicators might be signaling inflationary pressures or supply chain challenges. Understanding these elements can provide a more nuanced view of the company's financial health beyond the headline numbers.

Economist

The broader economic context in which Upbound Group, Inc. operates cannot be overlooked. Macroeconomic factors such as interest rates, inflation and consumer spending patterns directly influence the company's performance. For instance, an increase in interest rates could raise borrowing costs, impacting Upbound's capital expenditure plans and debt servicing. Similarly, inflationary trends can affect both the cost structure of the company and the purchasing power of its customers.

It's also pertinent to analyze the company's full-year performance in light of the economic cycle. If the company has shown resilience or growth during a downturn, it might suggest strong fundamentals and a competitive advantage. Conversely, if the economy is in an expansion phase and the company is not keeping pace with the growth rates of its peers, it could be a cause for concern. These economic insights are crucial for understanding the long-term sustainability of Upbound's financial performance.

Total Revenue of $1,018 Million for Fourth Quarter and $4 Billion for Full Year

GAAP Diluted EPS $(0.21) for Fourth Quarter and $(0.09) for Full Year

Non-GAAP Diluted EPS¹ $0.81 for Fourth Quarter and $3.55 for Full Year

PLANO, Texas--(BUSINESS WIRE)-- Upbound Group, Inc. (the "Company" or "Upbound") (NASDAQ:UPBD) today announced results for the quarter and year ended December 31, 2023. The earnings release, financial tables and related materials can be found on the Company's investor relations website at https://investor.upbound.com.

Today at 9 a.m. ET, Mitch Fadel, Chief Executive Officer, and Fahmi Karam, Chief Financial Officer, will host a conference call to review the financial results and provide 2024 outlook. The conference call can be accessed via an audio webcast through the investor relations website at investor.upbound.com, under events and presentations. Participants can access the call by phone via this link (Upbound Group Fourth Quarter Earnings Call), where the dial-in details will be provided. A replay will also be available on the website.

About Upbound Group, Inc.

Upbound Group, Inc. (NASDAQ: UPBD) is an omni-channel platform company committed to elevating financial opportunity for all through innovative, inclusive, and technology-driven financial solutions that address the evolving needs and aspirations of consumers. The Company’s customer-facing operating units include industry-leading brands such as Rent-A-Center® and Acima® that facilitate consumer transactions across a wide range of store-based and digital retail channels, including over 2,400 company branded retail units across the United States, Mexico and Puerto Rico. Upbound Group, Inc. is headquartered in Plano, Texas. For additional information about the Company, please visit our website Upbound.com.

Non-GAAP Financial Measures

This release and the Company's related conference call contain certain financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (GAAP), including (1) Non-GAAP diluted earnings per share (net earnings or loss, as adjusted for special items (as defined below), net of taxes, divided by the number of shares of our common stock on a fully diluted basis) and (2) other non-GAAP financial measures explained in the Company’s other quarterly earnings disclosures. “Special items” refers to certain gains and charges we view as extraordinary, unusual or non-recurring in nature or which we believe do not reflect our core business activities. For the periods presented herein, these special items are described in the quantitative reconciliation table included below in this release. Because of the inherent uncertainty related to these special items, management does not believe it is able to provide a meaningful forecast of the comparable GAAP measures or reconciliation to any forecasted GAAP measure without unreasonable effort. These non-GAAP measures are additional tools intended to assist our management in comparing our performance on a more consistent basis for purposes of business decision-making by removing the impact of certain items management believes do not directly reflect our core operations. These measures are intended to assist management in evaluating operating performance and liquidity, comparing performance and liquidity across periods, planning and forecasting future business operations, helping determine levels of operating and capital investments and identifying and assessing additional trends potentially impacting our Company that may not be shown solely by comparisons of GAAP measures. Consolidated Adjusted EBITDA is also used as part of our incentive compensation program for our executive officers and others. We believe these non-GAAP financial measures also provide supplemental information that is useful to investors, analysts and other external users of our consolidated financial statements in understanding our financial results and evaluating our performance and liquidity from period to period. However, non-GAAP financial measures have inherent limitations and are not substitutes for, or superior to, GAAP financial measures and they should be read together with, our consolidated financial statements prepared in accordance with GAAP. Further, because non-GAAP financial measures are not standardized, it may not be possible to compare such measures to the non-GAAP financial measures presented by other companies, even if they have the same or similar names.

Exhibit 1 - Reconciliation of diluted earnings per share to Non-GAAP diluted earnings per share
Three Months Ended December 31, 2023	Diluted Earnings
	per Share
GAAP Results	(0.21	)
Plus: Special Items
Acima equity consideration vesting	0.94
Acima acquired assets depreciation and amortization (1)	0.25
Accelerated software depreciation	0.06
Legal settlements	-
Discrete income tax items	(0.23	)
Non-GAAP Adjusted Results	0.81
(1) Includes amortization of approximately $14.2 million related to the total fair value of acquired intangible assets and incremental depreciation of approximately $4.0 million.

Year Ended December 31, 2023	Diluted Earnings
	per Share
GAAP Results	(0.09	)
Plus: Special Items
Acima equity consideration vesting	3.13
Acima acquired assets depreciation and amortization (1)	0.67
Accelerated software depreciation	0.12
Legal settlements	0.01
Other (2)	(0.04	)
Discrete income tax items	(0.25	)
Non-GAAP Adjusted Results	3.55
(1) Includes amortization of approximately $57.0 million related to the total fair value of acquired intangible assets and incremental depreciation of approximately $15.9 million.
(2) Represents interest income on tax refunds for prior years received in 2023.

¹ Non-GAAP financial measure. Refer to the explanations and reconciliations elsewhere in this release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240222857377/en/

Investor Contact:

Jeff Chesnut

SVP Strategy & Corporate Development

972-801-1108

jeff.chesnut@upbound.com

Source: Upbound Group, Inc.

FAQ

What was Upbound Group, Inc.'s total revenue for the fourth quarter and full year?

Upbound Group, Inc. reported total revenue of $1,018 million for the fourth quarter and $4 billion for the full year.

What were the GAAP diluted EPS figures for the fourth quarter and full year?

The GAAP diluted EPS was $(0.21) for the fourth quarter and $(0.09) for the full year.

What were the non-GAAP diluted EPS figures for the fourth quarter and full year?

The non-GAAP diluted EPS stood at $0.81 for the fourth quarter and $3.55 for the full year.

Who will host the conference call to discuss the financial results and outlook for 2024?

Mitch Fadel, Chief Executive Officer, and Fahmi Karam, Chief Financial Officer, will host the conference call.

Where can participants access the conference call?

Participants can access the conference call via an audio webcast through the investor relations website at investor.upbound.com.