Nicholas Financial, Inc. (NASDAQ: NICK) announced a net loss for
the three months ended June 30, 2022 of $1.8 million compared to
net income of $1.7 million for the three months ended June 30,
2021. Diluted net loss per share was $0.24 for the three months
ended June 30, 2022 as compared to diluted net income per share of
$0.22 for the three months ended June 30, 2021. Interest and fee
income on finance receivables decreased 4.2% to $12.1 million for
the three months ended June 30, 2022 as compared to $12.6 million
for the three months ended June 30, 2021. The Company total revenue
included an unrealized loss of $0.8 million on equity investments
in the three month ended June 30, 2022. The Company reported a loss
before income taxes for the three months ended June 30, 2022 of
$2.4 million compared to income before income taxes of $2.3 million
for the three months ended June 30, 2021. The Company recorded an
income tax benefit of approximately $0.6 million during the three
months ended June 30, 2022 as compared to income tax expense of
$0.6 million during the three months ended June 30, 2021.
For the quarter ended June 30, 2022, the Company
originated $30.6 million in finance receivables, collected $28.3
million in principal payments, purchased $7.2 million of equity
investments, increased debt by $11.8 million and decreased cash by
$1.2 million.
“While we ended up with a net loss of $1.8
million this fiscal quarter, we increased our finance receivables
by $1.3 million with a total of $30.6 million originated. Our
underwriting and servicing were top priorities through the quarter,
as we adhered to our core policies and procedures to ensure quality
and compliance.” commented Mike Rost, interim CEO of Nicholas
Financial.
“Adding another quarter of receivable growth is
a great accomplishment for the Company, but the net financial
results highlighted the need for an urgent reduction in operating
expenses, especially in the environment of rising delinquencies and
capital costs. As previously announced in July 2022, we executed a
branch consolidation plan affecting several markets along with
right-sizing the remaining branch network. We believe that this
initiative will allow the Company to be better positioned for the
possible economic downturn,” concluded Rost.
Key Performance Indicators on Contracts
Purchased |
|
(Purchases in thousands) |
|
|
|
|
Number of |
|
|
|
|
|
Average |
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal
Year |
|
|
Contracts |
|
|
Principal Amount |
|
|
Amount |
|
|
Average |
|
|
|
Average |
|
|
|
Average |
|
/Quarter |
|
|
Purchased |
|
|
Purchased# |
|
|
Financed*^ |
|
|
APR* |
|
|
|
Discount%* |
|
|
|
Term* |
|
|
2023 |
|
|
|
1,935 |
|
|
$ |
22,354 |
|
|
$ |
11,552 |
|
|
|
22.9 |
|
% |
|
|
6.6 |
|
% |
|
|
48 |
|
|
1 |
|
|
|
1,935 |
|
|
|
22,354 |
|
|
|
11,552 |
|
|
|
22.9 |
|
% |
|
|
6.6 |
|
% |
|
|
48 |
|
|
2022 |
|
|
|
7,793 |
|
|
$ |
85,804 |
|
|
$ |
11,002 |
|
|
|
23.1 |
|
% |
|
|
6.9 |
|
% |
|
|
47 |
|
|
4 |
|
|
|
2,404 |
|
|
|
27,139 |
|
|
|
11,289 |
|
|
|
22.9 |
|
% |
|
|
6.9 |
|
% |
|
|
47 |
|
|
3 |
|
|
|
1,735 |
|
|
|
19,480 |
|
|
|
11,228 |
|
|
|
23.1 |
|
% |
|
|
6.8 |
|
% |
|
|
47 |
|
|
2 |
|
|
|
1,707 |
|
|
|
18,880 |
|
|
|
11,061 |
|
|
|
23.0 |
|
% |
|
|
6.7 |
|
% |
|
|
47 |
|
|
1 |
|
|
|
1,947 |
|
|
|
20,305 |
|
|
|
10,429 |
|
|
|
23.2 |
|
% |
|
|
7.0 |
|
% |
|
|
46 |
|
|
2021 |
|
|
|
7,307 |
|
|
$ |
74,025 |
|
|
$ |
10,135 |
|
|
|
23.4 |
|
% |
|
|
7.5 |
|
% |
|
|
46 |
|
|
4 |
|
|
|
2,429 |
|
|
|
24,637 |
|
|
|
10,143 |
|
|
|
23.2 |
|
% |
|
7.5 |
|
% |
|
|
46 |
|
|
3 |
|
|
|
1,483 |
|
|
|
15,285 |
|
|
|
10,307 |
|
|
|
23.4 |
|
% |
|
|
7.5 |
|
% |
|
|
46 |
|
|
2 |
|
|
|
1,709 |
|
|
|
17,307 |
|
|
|
10,127 |
|
|
|
23.5 |
|
% |
|
|
6.8 |
|
% |
|
|
46 |
|
|
1 |
|
|
|
1,686 |
|
|
|
16,796 |
|
|
|
9,962 |
|
|
|
23.5 |
|
% |
|
|
8.0 |
|
% |
|
|
46 |
|
|
2020 |
|
|
|
7,647 |
|
|
$ |
76,696 |
|
|
$ |
10,035 |
|
|
|
23.4 |
|
% |
|
|
7.9 |
|
% |
|
|
47 |
|
Key Performance Indicators on Direct Loans
Originated(Originations in
thousands) |
|
|
|
|
Number of |
|
|
|
Principal |
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year |
|
|
Loans |
|
|
|
Amount |
|
|
Average Amount |
|
|
Average |
|
|
|
Average |
|
/Quarter |
|
|
Originated |
|
|
|
Originated |
|
|
Financed*^ |
|
|
APR* |
|
|
|
Term* |
|
|
2023 |
|
|
|
1,990 |
|
|
|
$ |
8,215 |
|
|
$ |
4,128 |
|
|
|
31.2 |
|
% |
|
|
25 |
|
|
1 |
|
|
|
1,990 |
|
|
|
|
8,215 |
|
|
|
4,128 |
|
|
|
31.2 |
|
% |
|
|
25 |
|
|
2022 |
|
|
|
6,770 |
|
|
|
$ |
28,740 |
|
|
$ |
4,307 |
|
|
|
30.5 |
|
% |
|
|
26 |
|
|
4 |
|
|
|
1,584 |
|
|
|
|
7,458 |
|
|
|
4,708 |
|
|
|
30.0 |
|
% |
|
|
27 |
|
|
3 |
|
|
|
2,282 |
|
|
|
|
8,505 |
|
|
|
3,727 |
|
|
31.8 |
|
% |
|
|
24 |
|
|
2 |
|
|
|
1,588 |
|
|
|
|
7,040 |
|
|
|
4,433 |
|
|
|
30.0 |
|
% |
|
|
26 |
|
|
1 |
|
|
|
1,316 |
|
|
|
|
5,737 |
|
|
|
4,359 |
|
|
30.1 |
|
% |
|
|
25 |
|
|
2021 |
|
|
|
3,497 |
|
|
|
|
$ |
14,148 |
|
|
$ |
4,131 |
|
|
|
29.6 |
|
% |
|
|
25 |
|
|
4 |
|
|
|
753 |
|
|
|
|
3,284 |
|
|
|
4,362 |
|
|
29.6 |
|
% |
|
|
25 |
|
|
3 |
|
|
|
1,265 |
|
|
|
|
4,605 |
|
|
|
3,641 |
|
|
30.9 |
|
% |
|
|
22 |
|
|
2 |
|
|
|
924 |
|
|
|
|
3,832 |
|
|
|
4,147 |
|
|
29.2 |
|
% |
|
|
25 |
|
|
1 |
|
|
|
555 |
|
|
|
|
2,427 |
|
|
|
4,373 |
|
|
28.7 |
|
% |
|
|
26 |
|
|
2020 |
|
|
|
3,142 |
|
|
|
|
$ |
12,638 |
|
|
$ |
4,017 |
|
|
|
28.2 |
|
% |
|
|
25 |
|
*Each average included in the tables is
calculated as a simple average.^Average amount
financed is calculated as a single loan
amount.#Bulk portfolio purchase excluded for
period-over-period comparability
Nicholas Financial, Inc. (NASDAQ:NICK) is a
specialized consumer finance company, operating branch locations in
both Southeastern and Midwestern U.S. States. The Company engages
primarily in acquiring and servicing automobile finance installment
contracts (“Contracts”) for purchases of used and new automobiles
and light trucks. Additionally, Nicholas Financial originates
direct consumer loans (“Direct Loans”) and sells consumer-finance
related products. For an index of Nicholas Financial, Inc’s new
releases or to obtain a specific release, please visit our website
at www.nicholasfinancial.com.
Cautionary Note regarding Forward-Looking
Statements
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
28may 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, the
Securities and Exchange Commission (SEC), Department of Justice,
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; 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 line of credit 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). All forward-looking
statements and cautionary statements included in this document are
made as of the date hereof based on information available to the
Company as of the date hereof, and the Company assumes no
obligation to update any forward-looking statement or cautionary
statement.
Nicholas Financial,
Inc.Condensed Consolidated Statements of
Income(Unaudited, Dollars in Thousands, Except Share and
Per Share Amounts)
|
Three months ended |
|
|
|
June 30, |
|
|
|
2022 |
2021 |
|
Revenue: |
|
|
|
|
|
|
Interest and fee income on finance receivables |
|
$ |
12,064 |
|
|
$ |
12,594 |
|
Unrealized losses on equity investments |
|
|
(787 |
) |
|
|
- |
|
Total Revenue |
|
$ |
11,277 |
|
|
$ |
12,594 |
|
Expenses: |
|
|
|
|
|
|
Operating expenses |
|
|
9,469 |
|
|
|
8,348 |
|
Provision for credit losses |
|
|
3,644 |
|
|
|
730 |
|
Interest expense |
|
|
568 |
|
|
|
1,188 |
|
Total expenses |
|
|
13,681 |
|
|
|
10,266 |
|
(Loss)/Income before income
taxes |
|
|
(2,404 |
) |
|
|
2,328 |
|
Income tax (benefit)/expense |
|
|
(627 |
) |
|
|
599 |
|
Net (Loss)/Income |
|
$ |
(1,777 |
) |
|
$ |
1,729 |
|
(Loss)/Earnings per share: |
|
|
|
|
|
|
Basic |
|
$ |
(0.24 |
) |
|
$ |
0.22 |
|
Diluted |
|
$ |
(0.24 |
) |
|
$ |
0.22 |
|
Condensed Consolidated Balance
Sheets(Unaudited, In Thousands)
|
|
June 30, |
March 31, |
|
|
|
2022 |
|
|
2022 |
|
Cash |
|
$ |
3,551 |
|
|
$ |
4,775 |
|
Equity investments |
|
|
6,449 |
|
|
|
- |
|
Finance receivables, net |
|
|
169,380 |
|
|
|
168,600 |
|
Repossessed assets |
|
|
988 |
|
|
|
658 |
|
Operating lease right-of-use
assets |
|
|
4,084 |
|
|
|
4,277 |
|
Other assets |
|
|
5,896 |
|
|
|
5,260 |
|
Total assets |
|
$ |
190,348 |
|
|
$ |
183,570 |
|
Line of credit, net of debt
issuance costs |
|
$ |
69,831 |
|
|
$ |
54,813 |
|
Note payable |
|
|
- |
|
|
|
3,244 |
|
Operating lease
liabilities |
|
|
4,228 |
|
|
|
4,410 |
|
Other liabilities |
|
|
3,967 |
|
|
|
4,717 |
|
Total liabilities |
|
|
78,026 |
|
|
|
67,184 |
|
Shareholders’ equity |
|
|
112,322 |
|
|
|
116,386 |
|
Total liabilities and
shareholders’ equity |
|
$ |
190,348 |
|
|
$ |
183,570 |
|
Book value per share |
|
$ |
15.36 |
|
|
$ |
15.42 |
|
|
|
Three months ended |
|
|
|
|
June 30, |
|
|
|
|
(In thousands) |
|
|
Portfolio
Summary |
|
2022 |
|
|
2021 |
|
|
Average finance receivables
(1) |
|
$ |
179,455 |
|
|
$ |
181,970 |
|
|
Average indebtedness (2) |
|
$ |
60,829 |
|
|
$ |
79,217 |
|
|
Interest and fee income on
finance receivables |
|
$ |
12,064 |
|
|
$ |
12,594 |
|
|
Interest expense |
|
|
568 |
|
|
|
1,188 |
|
|
Net interest and fee income on
finance receivables |
|
$ |
11,496 |
|
|
$ |
11,406 |
|
|
Portfolio yield (3) |
|
|
26.89 |
|
% |
|
27.68 |
|
% |
Interest expense as a
percentage of average finance receivables |
|
|
1.27 |
|
% |
|
2.61 |
|
% |
Provision for credit losses as
a percentage of average finance receivables |
|
|
8.12 |
|
% |
|
1.60 |
|
% |
Net portfolio yield (3) |
|
|
17.50 |
|
% |
|
23.47 |
|
% |
Operating expenses as a
percentage of average finance receivables |
|
|
21.11 |
|
% |
|
18.35 |
|
% |
Pre-tax yield as a
percentage of average finance receivables (4) |
|
|
(3.61 |
) |
% |
|
5.12 |
|
% |
Net charge-off percentage (5) |
|
|
6.48 |
|
% |
|
3.59 |
|
% |
Finance receivables |
|
$ |
180,053 |
|
|
$ |
180,823 |
|
|
Allowance percentage (6) |
|
|
2.05 |
|
% |
|
2.90 |
|
% |
Total reserves percentage
(7) |
|
|
5.95 |
|
% |
|
7.01 |
|
% |
Note: All three-month statement of income
performance indicators expressed as percentages have been
annualized.
(1) |
Average finance receivables represent the average of finance
receivables throughout the period. |
(2) |
Average indebtedness represents the average daily outstanding
borrowings under the line of credit. Average indebtedness does not
include the PPP loan. |
(3) |
Portfolio yield represents interest and fee income on finance
receivables as a percentage of average finance receivables. Net
portfolio yield represents (a) interest and fee income on
finance receivables minus (b) interest expense minus
(c) the provision for credit losses, as a percentage of
average finance receivables. |
(4) |
Pre-tax yield represents net portfolio yield minus operating
expenses, as a percentage of average finance receivables. |
(5) |
Net charge-off percentage represents net charge-offs
(charge-offs less recoveries) divided by average finance
receivables, outstanding during the period. |
(6) |
Allowance percentage represents the allowance for credit losses
divided by finance receivables outstanding as of ending balance
sheet dates. |
(7) |
Total reserves percentage represents the allowance for credit
losses, purchase price discount, and unearned dealer discounts
divided by finance receivables outstanding as of ending balance
sheet date. |
The following tables present certain
information regarding the delinquency rates experienced by the
Company with respect to automobile finance installment contracts
(“Contracts”) and direct consumer loans (“Direct Loans”), excluding
any Chapter 13 bankruptcy accounts:
(In thousands, except percentages)
Contracts |
|
Balance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding |
|
|
30 – 59 days |
|
|
60 – 89 days |
|
|
|
90 – 119 days |
|
|
|
120+ |
|
|
|
Total |
|
|
June 30, 2022 |
|
$ |
153,029 |
|
|
$ |
8,958 |
|
|
$ |
4,041 |
|
|
|
$ |
1,448 |
|
|
|
$ |
29 |
|
|
|
$ |
14,476 |
|
|
|
|
|
|
|
|
5.85 |
|
% |
|
2.64 |
|
% |
|
|
0.95 |
|
% |
|
|
0.02 |
|
% |
|
|
9.46 |
|
% |
June 30, 2021 |
|
$ |
164,929 |
|
|
$ |
7,087 |
|
|
$ |
2,575 |
|
|
|
$ |
644 |
|
|
|
$ |
10 |
|
|
|
$ |
10,316 |
|
|
|
|
|
|
|
|
4.30 |
|
% |
|
1.56 |
|
% |
|
|
0.39 |
|
% |
|
|
0.01 |
|
% |
|
|
6.26 |
|
% |
|
|
|
|
|
|
|
Direct
Loans |
|
Balance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding |
|
|
30 – 59 days |
|
|
60 – 89 days |
|
|
|
90 – 119 days |
|
|
|
120+ |
|
|
|
Total |
|
|
June 30, 2022 |
|
$ |
26,779 |
|
|
$ |
889 |
|
|
$ |
300 |
|
|
|
$ |
187 |
|
|
|
$ |
0 |
|
|
|
$ |
1,376 |
|
|
|
|
|
|
|
|
3.32 |
|
% |
|
1.12 |
|
% |
|
|
0.70 |
|
% |
|
|
0.00 |
|
% |
|
|
5.14 |
|
% |
June 30, 2021 |
|
$ |
15,721 |
|
|
$ |
285 |
|
|
$ |
70 |
|
|
|
$ |
53 |
|
|
|
$ |
0 |
|
|
|
$ |
408 |
|
|
|
|
|
|
|
|
1.81 |
|
% |
|
0.45 |
|
% |
|
|
0.34 |
|
% |
|
|
0.00 |
|
% |
|
|
2.60 |
|
% |
The following table presents selected information on
Contracts purchased and Direct Loans originated by the
Company:
|
|
Contracts |
|
|
Direct Loans |
|
|
|
|
Three months ended |
|
|
Three months ended |
|
|
|
|
June 30, |
|
|
June 30, |
|
|
|
|
(Purchases in thousands) |
|
|
(Originations in thousands) |
|
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
Purchases/Originations |
|
$ |
22,354 |
|
|
$ |
20,305 |
|
|
$ |
8,215 |
|
|
|
$ |
5,737 |
|
|
Average APR |
|
|
22.9 |
|
% |
|
23.2 |
|
% |
31.2 |
|
% |
|
30.1 |
|
% |
Average discount |
|
|
6.6 |
|
% |
|
7.0 |
|
% |
N/A |
|
|
|
N/A |
|
|
Average term (months) |
|
|
48 |
|
|
|
46 |
|
|
|
25 |
|
|
|
|
25 |
|
|
Average amount financed |
|
$ |
11,552 |
|
|
$ |
10,429 |
|
|
$ |
4,128 |
|
|
|
$ |
4,359 |
|
|
Number of contracts |
|
|
1,935 |
|
|
|
1,947 |
|
|
|
1,990 |
|
|
|
|
1,316 |
|
|
The following table presents selected information on the
entire Contract and Direct Loan portfolios of the
Company:
|
|
Contracts |
|
|
Direct Loans |
|
|
|
|
As of |
|
|
As of |
|
|
|
|
June 30, |
|
|
June 30, |
|
|
Portfolio |
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
Average APR |
|
|
22.9 |
|
% |
|
22.8 |
|
% |
|
29.9 |
|
% |
|
|
28.8 |
|
% |
Average discount |
|
|
7.3 |
|
% |
|
7.5 |
|
% |
N/A |
|
|
|
N/A |
|
|
Average term (months) |
|
|
50 |
|
|
50 |
|
|
27 |
|
|
|
27 |
|
|
Number of active
contracts |
|
|
18,959 |
|
|
|
21,995 |
|
|
|
7,096 |
|
|
|
|
4,354 |
|
|
Contact:
Irina Nashtatik
CFO
Ph # (727)-726-0763
Web site: www.nicholasfinancial.com
Nicholas Financial Inc Bc (NASDAQ:NICK)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Nicholas Financial Inc Bc (NASDAQ:NICK)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024