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World Acceptance Corporation Reports Fiscal 2023 Second Quarter Results

World Acceptance Corporation (NASDAQ: WRLD) today reported financial results for its second quarter of fiscal 2023 and six months ended September 30, 2022.

Second quarter highlights

During its fiscal second quarter, World Acceptance Corporation slowed growth in both loan balances and customer base by tightening underwriting and reducing new borrower marketing spend. Management believes that continuing to conservatively manage investment in our highest credit-risk customers, including lower credit-grade new customers, is prudent given current economic uncertainties.

Highlights from the second quarter include:

  • Gross loans outstanding of $1.60 billion, a 14.6% increase from same quarter prior year
  • Total revenues of $151.2 million, a 9.72% increase from the same quarter prior year
  • Net loss of $1.4 million and adjusted net loss of $1.2 million
  • Net loss per share of $0.24 and adjusted net loss per diluted share of $0.20
  • Cash flow from operating activities of $136.7 million over the last six months, a 27.7% increase from the same period in FY2022



    See "Non-GAAP financial measures." below.

Portfolio results

Gross loans outstanding were $1.60 billion as of September 30, 2022, a 14.6% increase from the $1.39 billion of gross loans outstanding as of September 30, 2021. During the most recent quarter, gross loans outstanding decreased 2.6%, or $43.4 million, from $1.64 billion as of June 30, 2022, compared to an increase of 14.0%, or $171.7 million, in the comparable quarter of the prior year. During the quarter, we saw a decrease in borrowing from new and former customers compared to the same quarter of the prior year. During the quarter, we continued to tighten the credit model underwriting on new borrowers implemented in the prior quarter, as well as took steps to improve the gross yield to expected loss ratio for all new, former, and refinance customer originations.

The following table includes the volume of gross loan origination balances, excluding tax advance loans, by customer type for the following comparative quarterly periods:

 

Q2 FY 2023

Q2 FY 2022

Q2 FY 2021

New Customers

$41,008,781

$97,139,581

$40,950,109

Former Customers

$94,612,837

$123,686,880

$89,819,052

Refinance Customers

$621,104,354

$586,422,822

$523,735,959

Our customer base decreased by 2.3% during the twelve-month period ended September 30, 2022, compared to an increase of 5.0% for the comparable period ended September 30, 2021. During the quarter ended September 30, 2022, the number of unique borrowers in the portfolio decreased by 5.1% compared to an increase of 8.2% during the quarter ended September 30, 2021. As a result of the expanded emphasis on our larger loan offerings, the average gross loan balance increased 17.6% as of September 30, 2022, compared to September 30, 2021.

As of September 30, 2022, the Company had 1,104 open branches. For branches open throughout both periods, same store gross loans increased 21.2% in the twelve-month period ended September 30, 2022, compared to an increase of 27.5% for the twelve-month period ended September 30, 2021. For branches open throughout both periods, the customer base over the twelve-month period ended September 30, 2022, increased 3.3% compared to an increase of 6.3% for the twelve-month period ended September 30, 2021.

Three-month financial results

Net income for the second quarter of fiscal 2023 decreased by $13.8 million to a $1.4 million loss from $12.4 million of income for the same quarter of the prior year. Net income per diluted share decreased to a $0.24 loss per share in the second quarter of fiscal 2023 from income of $1.94 per share for the same quarter of the prior year. Net loss adjusted for the impact of the change in the allowance for credit losses but including the impact of recognized net credit losses was $1.2 million for the current quarter compared to income of $27.3 million in the same quarter of the prior year. Adjusted net income per diluted share decreased to a loss of $0.20 per share in the second quarter of fiscal 2023 from income of $4.26 per share for the same quarter of the prior year. We believe this provides additional insight into our operations and profitability in periods of substantial growth and provides additional information regarding the expected loss rates due to credit normalization and seasonality. See further discussion on the current quarter provision and impact of current expected credit loss methodology below.

There were no repurchases of common stock during the second quarter of fiscal 2023. The Company repurchased 73,643 shares of its common stock on the open market at an aggregate purchase price of approximately $14.3 million during the first quarter of fiscal 2023. This is in addition to repurchase of 589,533 shares in fiscal 2022 at an aggregate purchase price of approximately $111.1 million and the repurchase of 1,129,875 shares in fiscal 2021 at an aggregate purchase price of approximately $102.4 million. The Company had approximately 5.7 million common shares outstanding, excluding approximately 550,000 unvested restricted shares, as of September 30, 2022. As of September 30, 2022, the Company had the ability to repurchase approximately $1.1 million of additional shares under its current share repurchase program and, subject to board approval, could repurchase approximately $13.5 million of shares under the terms of its debt facilities.

Total revenues for the second quarter of fiscal 2023 increased to $151.2 million, a 9.7% increase from $137.8 million for the same quarter of the prior year. This was driven by a 9.9% increase in average gross earning loans (total gross loans less gross loans 60 days contractually past due and tax advances). Interest and fee income increased 10.5%, from $118.1 million in the second quarter of fiscal 2022 to $130.5 million in the second quarter of fiscal 2023 due to an increase in loans outstanding. Insurance income increased by 21.9% to $16.8 million in the second quarter of fiscal 2023 compared to $13.8 million in the second quarter of fiscal 2022. The large loan portfolio increased from 47.6% of the overall portfolio as of September 30, 2021, to 55.4% as of September 30, 2022. This resulted in lower interest and fee yields but higher insurance sales in the most recent quarter, given that the sale of insurance products is limited to large loans in several states in which we operate. Other income decreased by 33.4% to $3.9 million in the second fiscal quarter of fiscal 2023 compared to $5.9 million in the second fiscal quarter of fiscal 2022. Other income decreased due to a decrease in sales of our motor club product.

On April 1, 2020, the Company replaced its incurred loss methodology with a current expected credit loss ("CECL") methodology to accrue for expected losses. This change in accounting methodology requires us to create a larger provision for credit losses on the day we originate the loan compared to the prior methodology. The provision for credit losses increased $26.6 million to $68.6 million from $42.0 million when comparing the second quarter of fiscal 2023 to the second quarter of fiscal 2022. The table below itemizes the key components of the CECL allowance and provision impact during the quarter.

CECL Allowance and Provision (Dollars in millions)

 

FY 2023

 

FY 2022

 

Difference

Beginning Allowance - June 30

 

$155.7

 

$97.9

 

$57.8

Change due to Growth

 

$(4.1)

 

$13.7

 

$(17.8)

Change due to Expected Loss Rate on Performing Loans

 

$(3.6)

 

$(0.2)

 

$(3.4)

Change due to 90 day past due

 

$7.9

 

$3.3

 

$4.6

Ending Allowance - September 30

 

$155.9

 

$114.7

 

$41.2

 

 

 

 

 

 

 

Net Charge-offs

 

$68.4

 

$25.2

 

$43.2

Provision

 

$68.6

 

$42.0

 

$26.6

Note: The change in allowance for the quarter plus net charge-offs for the quarter equals the provision for the quarter.

The change in the allowance during the quarter was significantly impacted by an increase in accounts 90 days past due. This was partially offset by a decrease in the portfolio and changes in expected loss rates on our performing loans. The three most important factors impacting the expected loss rates on performing loans are recent actual loss performance, changes in mix of the portfolio tenure, and a seasonality factor. The table below includes the seasonality factor for each quarter end.

Quarter End

Seasonality Factor

March 31

0.943738

June 30

1.080301

September 30

1.047518

December 31

0.938281

Expected loss rates by tenure bucket also increased due to actual loss rates increasing as credit normalizes. This was offset to some degree by a shift in portfolio mix to more tenured customers.

Net charge-offs for the quarter increased $43.2 million, from $25.2 million in the second quarter of fiscal 2022 to $68.4 million in the second quarter of fiscal 2023. Net charge-offs as a percentage of average net loan receivables on an annualized basis increased from 10.5% in the second quarter of fiscal 2022 to 23.0% in the second quarter of fiscal 2023.

Accounts 61 days or more past due increased to 8.0% on a recency basis at September 30, 2022, compared to 5.0% at September 30, 2021. The accounts 61 days or more past due include $5.3 million in gross loans related to loans acquired at a discount during the fiscal year. Total delinquency on a recency basis increased to 12.5% at September 30, 2022, compared to 8.9% at September 30, 2021. Our allowance for credit losses as a percent of net loans receivable was 13.5% at September 30, 2022, compared to 11.2% at September 30, 2021.

The table below is updated to use the customer tenure based methodology that aligns with our CECL methodology. After experiencing rapid portfolio growth during fiscal years 2019 and 2020, primarily in new customers, our gross loan balance experienced pandemic related declines in fiscal 2021 before rebounding during fiscal 2022. The tables below illustrate the changes in the portfolio weighting.

Gross Loan Balance By Customer Tenure at Origination

As of

Less Than 2 Years

More Than 2 Years

Total

09/30/2017

$292,919,738

$731,005,012

$1,023,924,750

09/30/2018

$360,508,875

$766,281,264

$1,126,790,139

09/30/2019

$457,720,143

$816,488,354

$1,274,208,497

09/30/2020

$365,242,591

$744,182,305

$1,109,424,896

09/30/2021

$455,201,848

$939,669,804

$1,394,871,652

09/30/2022

$481,374,232

$1,117,025,275

$1,598,399,507

Year-Over-Year Growth (Decline) in Gross Loan Balance by Customer Tenure at Origination

12 Month Period Ended

Less Than 2 Years

More Than 2 Years

Total

9/30/2017

$19,023,915

$12,819,275

$31,843,190

9/30/2018

$67,589,136

$35,276,253

$102,865,389

9/30/2019

$97,211,268

$50,207,090

$147,418,358

9/30/2020

$(92,477,552)

$(72,306,050)

$(164,783,602)

9/30/2021

$89,959,256

$195,487,500

$285,446,756

9/30/2022

$25,139,613

$178,388,242

$203,527,855

Change in Portfolio Mix by Customer Tenure at Origination

As of

Less Than 2 Years

More Than 2 Years

9/30/2017

6.9%

1.8%

9/30/2018

23.1%

4.8%

9/30/2019

27.0%

6.6%

9/30/2020

(20.2)%

(8.9)%

9/30/2021

24.6%

26.3%

9/30/2022

5.5%

19.0%

General and administrative (“G&A”) expenses decreased $3.8 million, or 5.1%, to $71.2 million in the second quarter of fiscal 2023 compared to $75.0 million in the same quarter of the prior fiscal year. As a percentage of revenues, G&A expenses decreased from 54.4% during the second quarter of fiscal 2022 to 47.1% during the second quarter of fiscal 2023. G&A expenses per average open branch increased by 1.4% when comparing the second quarter of fiscal 2023 to the second quarter fiscal 2022.

Personnel expense decreased $0.5 million, or 1.0%, during the second quarter of fiscal 2023 as compared to the second quarter of fiscal 2022. Salary expense increased approximately $3.3 million, or 11.4%, in the quarter ended September 30, 2022, compared to the quarter ended September 30, 2021. Our headcount as of September 30, 2022, increased 1.8% compared to September 30, 2021. Benefit expense decreased approximately $0.7 million, or 8.2%, when comparing the quarterly periods ended September 30, 2022 and 2021. Incentive expense decreased $3.6 million, or 31.8%, in the second quarter of fiscal 2023 compared to second quarter of fiscal 2022. On July 1, 2022, we increased base wages for our Financial Service Representatives to a minimum of approximately $15 an hour and eliminated the monthly bonus for the same position.

Occupancy and equipment expense increased $0.6 million, or 4.3%, when comparing the quarterly periods ended September 30, 2022 and 2021. The current year includes $0.7 million in expense related to the merger of branches during the quarter.

Advertising expense decreased $4.3 million, or 80.9%, in the second quarter of fiscal 2023 compared to the second quarter of fiscal 2022 due to decreased spending on new customer acquisition programs.

Other expense increased $0.5 million, or 5.3%, in the second quarter of fiscal 2023 compared to the second quarter of fiscal 2022.

Interest expense for the quarter ended September 30, 2022, increased by $6.3 million, or 94.1%, from the corresponding quarter of the previous year. Interest expense increased due to an increase in average debt outstanding and a 32.6% increase in the effective interest rate from 5.0% to 6.7%. The average debt outstanding increased from $524.7 million to $775.6 million when comparing the quarters ended September 30, 2021 and 2022. The Company’s debt to equity ratio increased to 2.1:1 at September 30, 2022, compared to 1.4:1 at September 30, 2021. As of September 30, 2022, the Company had $746.7 million of debt outstanding, net of unamortized debt issuance costs related to the unsecured senior notes payable. The net paydown of debt during the quarter was $30.5 million.

Other key return ratios for the second quarter of fiscal 2023 included a 1.3% return on average assets and a return on average equity of 4.1% (both on a trailing twelve-month basis).

Six-Month Results

Net income for the six-months ended September 30, 2022, decreased $38.4 million to a $10.2 million loss compared to income of $28.2 million for the same period of the prior year. This resulted in a net loss of $1.77 per diluted share for the six months ended September 30, 2022, compared to a net income of $4.38 per diluted share in the prior-year period. Total revenues for the first six-months of fiscal 2023 increased 15.5% to $308.8 million compared to $267.5 million during the corresponding period of the previous year due to an increase in loans outstanding. Annualized net charge-offs as a percent of average net loans increased from 10.9% during the first six-months of fiscal 2022 to 22.8% for the first six-months of fiscal 2023.

Non-GAAP financial measures

From time-to-time the Company uses certain financial measures derived on a basis other than generally accepted accounting principles (“GAAP”), primarily by excluding from a comparable GAAP measure certain items the Company does not consider to be representative of its actual operating performance. Such financial measures qualify as “non-GAAP financial measures” as defined in SEC rules. The Company uses these non-GAAP financial measures in operating its business because management believes they are less susceptible to variances in actual operating performance that can result from the excluded items and other infrequent charges. The Company may present these financial measures to investors because management believes they are useful to investors in evaluating the primary factors that drive the Company’s core operating performance and provide greater transparency into the Company’s results of operations. However, items that are excluded and other adjustments and assumptions that are made in calculating these non-GAAP financial measures are significant components to understanding and assessing the Company’s financial performance. Such non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, the Company’s GAAP financial measures. Further, because these non-GAAP financial measures are not determined in accordance with GAAP and are, thus, susceptible to varying calculations, any non-GAAP financial measures, as presented, may not be comparable to other similarly titled measures of other companies.

For purposes of assessing performance, the Company will adjust earnings to remove the impact of the change in the allowance for credit losses but including the impact of recognized net credit losses. The Company believes this measure improves the compatibility of our results to peer companies who use varying methods to determine their allowance for credit losses under the CECL. The measure also normalizes earnings for the impact of growth, seasonality and periods of volatility in expected loss rates.

This measure has limitations as an analytical tool and should not be considered in isolation or as a substitute for GAAP earnings or other income statement data prepared in accordance with GAAP. The following table reconciles GAAP net income (loss) to Adjusted net income (loss):

 

Three months

ended

September 30,

 

Three months

ended

September 30,

 

2022

 

2021

 

 

 

 

Income (loss) before income taxes

$(1,612,225)

 

$

14,080,846

 

 

 

 

 

Provision for credit losses

68,620,146

 

 

42,043,526

 

Net charge-offs

(68,378,724)

 

 

(25,235,916

)

Adjusted income (loss) before income taxes

(1,370,803)

 

 

30,888,456

 

Income tax expense (benefit) at actual rate

(209,385)

 

 

3,599,241

 

Adjusted net income (loss)

$(1,161,418)

 

$

27,289,215

 

 

 

 

 

Weighted average dilutive shares outstanding

5,726,469

 

 

6,413,079

 

 

 

 

 

Adjusted net income (loss) per common share, diluted

$(0.20)

 

$

4.26

 

About World Acceptance Corporation (World Finance)

Founded in 1962, World Acceptance Corporation (NASDAQ: WRLD), is a people-focused finance company that provides personal installment loan solutions and personal tax preparation and filing services to over one million customers each year. Headquartered in Greenville, South Carolina, the Company operates more than 1,100 community-based World Finance branches across 16 states. The Company primarily serves a segment of the population that does not have ready access to credit; however, unlike many other lenders in this segment, we strive to work with our customers to understand their broader financial pictures, ensure they have the ability and stability to make payments, and help them achieve their financial goals. For more information, visit www.loansbyworld.com.

Second quarter conference call

The senior management of World Acceptance Corporation will be discussing these results in its quarterly conference call to be held at 10:00 a.m. Eastern Time today. A simulcast of the conference call will be available on the Internet at https://event.choruscall.com/mediaframe/webcast.html?webcastid=Su51S5JD. The call will be available for replay on the Internet for approximately 30 days.

During the conference call, the Company may discuss and answer questions concerning business and financial developments and trends that have occurred after quarter-end. The Company’s responses to questions, as well as other matters discussed during the conference call, may contain or constitute information that has not been disclosed previously.

Cautionary Note Regarding Forward-looking Information

This press release may contain various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, that represent the Company’s current expectations or beliefs concerning future events. Statements other than those of historical fact, as well as those identified by words such as “anticipate,” “estimate,” intend,” “plan,” “expect,” “project,” “believe,” “may,” “will,” “should,” “would,” “could,” “probable” and any variation of the foregoing and similar expressions are forward-looking statements. Such forward-looking statements are inherently subject to risks and uncertainties. The Company’s actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause actual results or performance to differ from the expectations expressed or implied in such forward-looking statements include the following: the ongoing impact of the COVID-19 pandemic and the mitigation efforts by governments and related effects on our financial condition, business operations and liquidity, our customers, our employees, and the overall economy; recently enacted, proposed or future legislation and the manner in which it is implemented; changes in the U.S. tax code; the nature and scope of regulatory authority, particularly discretionary authority, that may be exercised by regulators, including, but not limited to, U.S. Consumer Financial Protection Bureau, and individual state regulators having jurisdiction over the Company; the unpredictable nature of regulatory proceedings and litigation; employee misconduct or misconduct by third parties; uncertainties associated with management turnover and the effective succession of senior management; media and public characterization of consumer installment loans; labor unrest; the impact of changes in accounting rules and regulations, or their interpretation or application, which could materially and adversely affect the Company’s reported consolidated financial statements or necessitate material delays or changes in the issuance of the Company’s audited consolidated financial statements; the Company's assessment of its internal control over financial reporting; changes in interest rates; the impact of inflation; risks relating to the acquisition or sale of assets or businesses or other strategic initiatives, including increased loan delinquencies or net charge-offs, the loss of key personnel, integration or migration issues, the failure to achieve anticipated synergies, increased costs of servicing, incomplete records, and retention of customers; risks inherent in making loans, including repayment risks and value of collateral; cybersecurity threats, including the potential misappropriation of assets or sensitive information, corruption of data or operational disruption; our dependence on debt and the potential impact of limitations in the Company’s amended revolving credit facility or other impacts on the Company's ability to borrow money on favorable terms, or at all; the timing and amount of revenues that may be recognized by the Company; changes in current revenue and expense trends (including trends affecting delinquency and charge-offs); the impact of extreme weather events and natural disasters; changes in the Company’s markets and general changes in the economy (particularly in the markets served by the Company).

These and other factors are discussed in greater detail in Part I, Item 1A,“Risk Factors” in the Company’s most recent annual report on Form 10-K for the fiscal year ended March 31, 2022, as filed with the SEC and the Company’s other reports filed with, or furnished to, the SEC from time to time. World Acceptance Corporation does not undertake any obligation to update any forward-looking statements it makes. The Company is also not responsible for updating the information contained in this press release beyond the publication date, or for changes made to this document by wire services or Internet services.

WORLD ACCEPTANCE CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited and in thousands, except per share amounts)

 

Three months ended September 30,

 

Six months ended September 30,

 

2022

 

2021

 

2022

 

2021

Revenues:

 

 

 

 

 

 

 

Interest and fee income

$

130,462

 

 

$

118,113

 

$

260,667

 

 

$

227,288

Insurance income, net and other income

 

20,765

 

 

 

19,713

 

 

48,154

 

 

 

40,198

Total revenues

 

151,227

 

 

 

137,826

 

 

308,821

 

 

 

267,486

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

Provision for credit losses

 

68,620

 

 

 

42,044

 

 

154,442

 

 

 

72,309

General and administrative expenses:

 

 

 

 

 

 

 

Personnel

 

45,295

 

 

 

45,746

 

 

90,473

 

 

 

91,978

Occupancy and equipment

 

13,491

 

 

 

12,935

 

 

26,726

 

 

 

26,542

Advertising

 

1,010

 

 

 

5,295

 

 

3,218

 

 

 

9,055

Amortization of intangible assets

 

1,106

 

 

 

1,246

 

 

2,238

 

 

 

2,460

Other

 

10,284

 

 

 

9,767

 

 

21,381

 

 

 

18,306

Total general and administrative expenses

 

71,186

 

 

 

74,989

 

 

144,036

 

 

 

148,341

 

 

 

 

 

 

 

 

Interest expense

 

13,032

 

 

 

6,714

 

 

24,207

 

 

 

12,215

Total expenses

 

152,838

 

 

 

123,747

 

 

322,685

 

 

 

232,865

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(1,611

)

 

 

14,079

 

 

(13,864

)

 

 

34,621

 

 

 

 

 

 

 

 

Income tax expense (benefit)

 

(246

)

 

 

1,641

 

 

(3,696

)

 

 

6,412

 

 

 

 

 

 

 

 

Net income (loss)

$

(1,365

)

 

$

12,438

 

$

(10,168

)

 

$

28,209

 

 

 

 

 

 

 

 

Net income (loss) per common share, diluted

$

(0.24

)

 

$

1.94

 

$

(1.77

)

 

$

4.38

 

 

 

 

 

 

 

 

Weighted average diluted shares outstanding

 

5,726

 

 

 

6,413

 

 

5,734

 

 

 

6,434

WORLD ACCEPTANCE CORPORATION AND SUBSIDIARIES

 

CONSOLIDATED BALANCE SHEETS

(unaudited and in thousands)

 

September 30, 2022

 

March 31, 2022

 

September 30, 2021

ASSETS

 

 

 

 

 

Cash and cash equivalents

$

20,695

 

 

$

19,236

 

 

$

16,886

 

Gross loans receivable

 

1,598,361

 

 

 

1,522,789

 

 

 

1,394,827

 

Less:

 

 

 

 

 

Unearned interest, insurance and fees

 

(439,656

)

 

 

(403,031

)

 

 

(370,017

)

Allowance for credit losses

 

(155,892

)

 

 

(134,243

)

 

 

(114,660

)

Loans receivable, net

 

1,002,813

 

 

 

985,515

 

 

 

910,150

 

Operating lease right-of-use assets, net

 

85,517

 

 

 

85,631

 

 

 

88,197

 

Finance lease right-of-use assets, net

 

 

 

 

608

 

 

 

810

 

Property and equipment, net

 

24,741

 

 

 

24,476

 

 

 

25,067

 

Deferred income taxes, net

 

47,299

 

 

 

39,801

 

 

 

34,248

 

Other assets, net

 

41,303

 

 

 

35,902

 

 

 

35,544

 

Goodwill

 

7,371

 

 

 

7,371

 

 

 

7,371

 

Intangible assets, net

 

17,518

 

 

 

19,756

 

 

 

22,306

 

Total assets

$

1,247,257

 

 

$

1,218,296

 

 

$

1,140,579

 

 

 

 

 

 

 

LIABILITIES & SHAREHOLDERS' EQUITY

 

 

 

 

 

Liabilities:

 

 

 

 

 

Senior notes payable

$

450,899

 

 

$

396,973

 

 

$

275,706

 

Senior unsecured notes payable, net

 

295,793

 

 

 

295,394

 

 

 

294,897

 

Income taxes payable

 

1,505

 

 

 

7,384

 

 

 

8,258

 

Operating lease liability

 

87,968

 

 

 

87,399

 

 

 

89,754

 

Finance lease liability

 

 

 

 

80

 

 

 

284

 

Accounts payable and accrued expenses

 

54,511

 

 

 

58,042

 

 

 

52,673

 

Total liabilities

 

890,676

 

 

 

845,272

 

 

 

721,572

 

 

 

 

 

 

 

Shareholders' equity

 

356,581

 

 

 

373,024

 

 

 

419,007

 

Total liabilities and shareholders' equity

$

1,247,257

 

 

$

1,218,296

 

 

$

1,140,579

 

WORLD ACCEPTANCE CORPORATION AND SUBSIDIARIES

 

SELECTED CONSOLIDATED STATISTICS

(unaudited and in thousands, except percentages and branches)

 

 

Three months ended

September 30,

Six months ended

September 30,

 

 

2022

 

2021

2022

 

2021

 

 

 

 

 

 

 

 

Gross loans receivable

 

$

1,598,361

 

 

$

1,394,827

 

$

1,598,361

 

 

$

1,394,827

 

Average gross loans receivable (1)

 

 

1,635,556

 

 

 

1,314,397

 

 

1,600,374

 

 

 

1,230,307

 

Net loans receivable (2)

 

 

1,158,705

 

 

 

1,024,810

 

 

1,158,705

 

 

 

1,024,810

 

Average net loans receivable (3)

 

 

1,187,295

 

 

 

965,588

 

 

1,166,656

 

 

 

908,381

 

 

 

 

 

 

 

 

 

Expenses as a percentage of total revenue:

 

 

 

 

 

 

 

Provision for credit losses

 

 

45.4

%

 

 

30.5

%

 

50.0

%

 

 

27.0

%

General and administrative

 

 

47.1

%

 

 

54.4

%

 

46.6

%

 

 

55.5

%

Interest expense

 

 

8.6

%

 

 

4.9

%

 

7.8

%

 

 

4.6

%

Operating income as a % of total revenue (4)

 

 

7.6

%

 

 

15.1

%

 

3.3

%

 

 

17.5

%

 

 

 

 

 

 

 

 

Loan volume (5)

 

 

756,477

 

 

 

801,487

 

 

1,688,856

 

 

 

1,555,696

 

 

 

 

 

 

 

 

 

Net charge-offs as percent of average net loans receivable on an annualized basis

 

 

23.0

%

 

 

10.5

%

 

22.8

%

 

 

10.9

%

 

 

 

 

 

 

 

 

Return on average assets (trailing 12 months)

 

 

1.3

%

 

 

8.6

%

 

1.3

%

 

 

8.6

%

 

 

 

 

 

 

 

 

Return on average equity (trailing 12 months)

 

 

4.1

%

 

 

22.4

%

 

4.1

%

 

 

22.4

%

 

 

 

 

 

 

 

 

Branches opened or acquired (merged or closed), net

 

 

(42

)

 

 

(3

)

 

(63

)

 

 

(3

)

 

 

 

 

 

 

 

 

Branches open (at period end)

 

 

1,104

 

 

 

1,202

 

 

1,104

 

 

 

1,202

 

_______________________________________________________

(1) Average gross loans receivable have been determined by averaging month-end gross loans receivable over the indicated period, excluding tax advances.

(2) Net loans receivable is defined as gross loans receivable less unearned interest and deferred fees.

(3) Average net loans receivable have been determined by averaging month-end gross loans receivable less unearned interest and deferred fees over the indicated period, excluding tax advances.

(4) Operating income is computed as total revenues less provision for credit losses and general and administrative expenses.

(5) Loan volume includes all loan balances originated by the Company. It does not include loans purchased through acquisitions.

 

Contacts

John L. Calmes, Jr.

Chief Financial and Strategy Officer

(864) 298-9800

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