AmeriCredit Reports First Quarter Operating Results
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-- 1stQuarter earnings of $26 million, $0.19 per share
-- Loan originations of $229 million
-- Total available liquidity of $704 million
FORT WORTH, Texas--(BUSINESS WIRE)-- AMERICREDIT CORP. (NYSE: ACF) today announced net income of $26 million, or $0.19 per share, for its fiscal first quarter ended September 30, 2009. The Company reported a net loss of $5 million, or $0.05 per share, for the same period a year earlier. Net loss for the quarter ended September 30, 2008, was revised, from a net loss of $2 million, or $0.01 per share, to reflect the retrospective adoption, on July 1, 2009, of a new accounting standard that changes the accounting for convertible bonds.
Originations were $229 million for the quarter ended September 30, 2009, compared to $579 million for the same quarter last fiscal year. Finance receivables totaled $10.0 billion at September 30, 2009, compared to $14.1 billion at September 30, 2008.
Annualized net charge-offs totaled 8.4% of average finance receivables for the quarter ended September 30, 2009, compared to 7.3% for the quarter ended September 30, 2008.
Finance receivables 31-to-60 days delinquent were 7.6% of the portfolio at September 30, 2009, compared to 7.4% at September 30, 2008. Accounts more than 60 days delinquent were 3.8% of the portfolio at September 30, 2009, compared to 3.6% a year ago.
The allowance for loan losses as a percentage of finance receivables was 8.2% at September 30, 2009, compared to 8.2% at June 30, 2009 and 6.8% at September 30, 2008.
The Company had total available liquidity of $704 million at September 30, 2009, consisting of $462 million of unrestricted cash and approximately $242 million of borrowing capacity on unpledged eligible receivables. During the September quarter, the Company received a $113 million income tax refund. Subsequent to September 30, 2009, the Company received an additional income tax refund of $85 million, for a total refund of $198 million resulting from federal net loss carrybacks.
"We had a solid September quarter. Credit metrics reflected typical seasonal decline and the impact of a decreasing portfolio balance. However, we are seeing a moderation in the rate of deterioration in our credit performance," said President and Chief Executive Officer Dan Berce. "With ample liquidity, sufficient warehouse capacity and an improving capital markets environment, we are well-positioned to rebuild loan origination levels."
AmeriCredit will host a conference call for analysts and investors today at 5:30 p.m. Eastern time. For a live Internet broadcast of this conference call, please go to the Company's Web site to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call.
About AmeriCredit
AmeriCredit Corp. is a leading independent automobile finance company that provides financing solutions indirectly through auto dealers across the United States. AmeriCredit has approximately 900,000 customers and $10 billion in auto receivables. The Company was founded in 1992 and is headquartered in Fort Worth, Texas. For more information, visit www.americredit.com.
Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements that involve risks and uncertainties detailed from time to time in the Company's filings and reports with the Securities and Exchange Commission including the Company's annual report on Form 10-K for the year ended June 30, 2009. Such risks include - but are not limited to - variable economic conditions, adverse portfolio performance, volatile wholesale vehicle values, reliance on warehouse financing and capital markets, the ability to continue to securitize loans, the continued availability of credit enhancement for securitization transactions on acceptable terms, fluctuating interest rates, competition, regulatory and legal changes, the high degree of risk associated with subprime borrowers, and exposure to litigation. These forward-looking statements are based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. Actual events or results may differ materially. It is advisable not to place undue reliance on any forward-looking statements. The Company undertakes no obligation to, and does not, publicly update or revise any forward-looking statements, except as required by federal securities laws, whether as a result of new information, future events or otherwise.
AmeriCredit Corp.
Consolidated Statements of Operations
(Unaudited, Dollars in Thousands, Except Per Share Amounts)
Three Months Ended
September 30,
2009 2008
(Revised)
Revenue:
Finance charge income $ 389,796 $ 533,973
Other income 23,488 31,076
Gain on retirement of debt 994
413,284 566,043
Costs and expenses:
Operating expenses 68,862 84,255
Leased vehicles depreciation 10,110 10,914
Provision for loan losses 157,951 274,865
Interest expense 130,148 200,654
Restructuring charges (37 ) 551
367,034 571,239
Income (loss) before income taxes 46,250 (5,196 )
Income tax provision 20,489 78
Net income (loss) $ 25,761 $ ( 5,274 )
Earnings (loss) per share:
Basic $ 0.19 $ (0.05 )
Diluted $ 0.19 $ (0.05 )
Weighted average shares 133,229,960 116,271,119
Weighted average shares and
assumed incremental shares 136,083,460 116,271,119
Consolidated Balance Sheets
(Unaudited, Dollars in Thousands)
September 30, June 30, September 30,
2009 2009 2008
(Revised) (Revised)
Cash and cash equivalents $ 462,106 $ 193,287 $ 243,752
Finance receivables, net 9,195,075 10,037,329 13,102,726
Restricted cash - securitization 873,304 851,606 915,694
notes payable
Restricted cash - credit facilities 170,281 195,079 190,619
Property and equipment, net 42,054 44,195 52,992
Leased vehicles, net 143,819 156,387 198,606
Deferred income taxes 54,659 75,782 282,876
Income tax receivable 84,387 197,579 21,832
Other assets 190,047 207,083 325,443
Total assets $ 11,215,732 $ 11,958,327 $ 15,334,540
Credit facilities $ 1,019,068 $ 1,630,133 $ 2,990,427
Securitization notes payable 7,266,456 7,426,687 9,289,957
Senior notes 91,620 91,620 200,000
Convertible debt 397,763 392,514 533,706
Accrued taxes and expenses 153,725 157,640 233,682
Interest rate swap agreements 119,756 131,885 63,489
Other liabilities 17,071 20,540 41,066
Total liabilities 9,065,459 9,851,019 13,352,327
Shareholders' equity 2,150,273 2,107,308 1,982,213
Total liabilities and shareholders' $ 11,215,732 $ 11,958,327 $ 15,334,540
equity
Consolidated Statements of Cash Flows
(Unaudited, Dollars in Thousands)
Three Months Ended
September 30,
2009 2008
(Revised)
Cash flows from operating activities:
Net income (loss) $ 25,761 $ (5,274 )
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 22,824 25,885
Accretion and amortization of fees 2,375 6,995
Provision for loan losses 157,951 274,865
Deferred income taxes 15,517 (5,162 )
Non-cash interest on convertible debt 5,249 5,608
Stock-based compensation expense 2,968 3,894
Amortization of warrants 1,968 12,348
Gain on retirement of debt (994 )
Other (6,817 ) 3,670
Changes in assets and liabilities:
Income tax receivable 113,207 1,065
Other assets 1,305 352
Accrued taxes and expenses (6,657 ) 6,960
Net cash provided by operating activities 335,651 330,212
Cash flows from investing activities:
Purchases of receivables (217,920 ) (586,647 )
Principal collections and recoveries on 912,121 1,213,444
receivables
Net change in restricted cash and other 13,335 36,882
Net cash provided by investing activities 707,536 663,679
Cash flows from financing activities:
Net change in credit facilities (611,065 ) 67,013
Net change in securitization notes payable (160,950 ) (1,130,862 )
Proceeds from issuance of common stock 1,136 14
Retirement of convertible debt (114,048 )
Other net changes (2,823 ) (6,348 )
Net cash used by financing activities (773,702 ) (1,184,231 )
Net increase (decrease) in cash and
cash equivalents 269,485 (190,340 )
Effect of Canadian exchange rate changes on
cash and cash equivalents (666 ) 599
Cash and cash equivalents at beginning of period 193,287 433,493
Cash and cash equivalents at end of period $ 462,106 $ 243,752
Other Financial Data
(Unaudited, Dollars in Thousands)
Three Months Ended
September 30,
2009 2008
Origination volume $ 229,073 $ 579,290
Loans securitized 981,056 -
Average finance receivables $ 10,482,453 $ 14,544,922
September 30, June 30, September 30,
2009 2009 2008
Finance receivables:
Principal $ 10,021,033 $ 10,927,969 $ 14,062,845
Allowance for loan losses and
nonaccretable acquisition fees (825,958 ) (890,640 ) (960,119 )
$ 9,195,075 $ 10,037,329 $ 13,102,726
Allowance as a percent of ending
finance receivables 8.2 % 8.2 % 6.8 %
September 30, June 30, September 30,
2009 2009 2008
Loan delinquency as a percent of
ending finance receivables:
31 - 60 days 7.6 % 6.9 % 7.4 %
Greater than 60 days 3.8 3.5 3.6
Total 11.4 % 10.4 % 11.0 %
Three Months Ended
September 30,
2009 2008
Contracts receiving a payment
deferral as an average quarterly
percentage of average finance
receivables 7.9 % 7.3 %
Net charge-offs $ 222,633 $ 265,859
Annualized net charge-offs as a
percent of average finance
receivables 8.4 % 7.3 %
Net recoveries as a
percent of gross repossession
charge-offs 42.7 % 41.6 %
Components of net margin:
Three Months Ended
September 30,
2009 2008
(Revised)
Finance charge income $ 389,796 $ 533,973
Other income 23,488 31,076
Interest expense (130,148 ) (200,654 )
Net margin $ 283,136 $ 364,395
Annualized net margin as a percent of average finance
receivables:
Three Months Ended
September 30,
2009 2008
(Revised)
Finance charge income 14.7 % 14.5 %
Other income 0.9 0.9
Interest expense (4.9 ) (5.5 )
Net margin 10.7 % 9.9 %
Three Months Ended
September 30,
2009 2008
Operating expenses $ 68,862 $ 84,255
Annualized operating expenses as
a
percent of average finance
receivables 2.6 % 2.3 %
On July 1, 2009, the Company adopted FSP APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement), which requires that the Company retrospectively apply FSP APB 14-1 to prior periods. The following table shows select financial statement data as reported in prior periods.
Fiscal Year
Three Months Ended Ended
September 30, December 31, March 31, June 30, June 30,
(As 2008 2008 2009 2009 2009
Reported)
Gain on
retirement $ 994 $ 37,873 $ 14,442 $ 9,886 $ 63,195
of debt
Interest 195,046 219,063 143,085 147,426 704,620
expense
Income
(loss)
before
income taxes 412 (39,631 ) 20,136 55,919 36,836
Income tax
provision
(benefit) 2,074 (14,075 ) 10,303 24,647 22,949
Net income (1,662 ) (25,556 ) 9,833 31,272 13,887
(loss)
Earnings
(loss) per
share:
Basic $ (0.01 ) $ (0.21 ) $ 0.07 $ 0.24 $ 0.11
Diluted $ (0.01 ) $ (0.21 ) $ 0.07 $ 0.23 $ 0.11
Weighted
average
shares
outstanding:
Basic 116,271,119 120,106,666 131,914,885 132,890,596 125,239,241
Diluted 116,271,119 120,106,666 133,982,994 133,523,867 129,381,343
The following table shows selected financial data as revised for the retrospective adoption of
FSP APB 14-1:
Fiscal Year
Three Months Ended Ended
September 30, December 31, March 31, June 30, June 30,
(Revised) 2008 2008 2009 2009 2009
Gain on
retirement $ 994 $ 30,411 $ 11,048 $ 5,699 $ 48,152
of debt
Interest 200,654 224,775 148,237 152,894 726,560
expense
Income
(loss)
before
income taxes (5,196 ) (52,805 ) 11,590 46,264 (147 )
Income tax
provision
(benefit) 78 (17,803 ) 13,996 14,471 10,742
Net income (5,274 ) (35,002 ) (2,406 ) 31,793 (10,889 )
(loss)
Earnings
(loss) per
share:
Basic $ (0.05 ) $ (0.29 ) $ (0.02 ) $ 0.24 $ (0.09 )
Diluted $ (0.05 ) $ (0.29 ) $ (0.02 ) $ 0.24 $ (0.09 )
Weighted
average
shares
outstanding:
Basic 116,271,119 120,106,666 131,914,885 132,890,596 125,239,241
Diluted 116,271,119 120,106,666 131,914,885 133,523,867 125,239,241
Source: AmeriCredit Corp.
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