Regional Management Corp. Announces First Quarter 2016 Results

- Net income of $5.2 million; diluted earnings per share of $0.40 -

- Total finance receivables of $607 million, up 15.5% compared to prior-year period -

- Total delinquencies as a percentage of finance receivables of 16.7%; historic low -

GREENVILLE, S.C.--(BUSINESS WIRE)-- Regional Management Corp. (NYSE: RM), a diversified specialty consumer finance company, today announced results for the first quarter ended March 31, 2016.

First Quarter 2016 Highlights and Subsequent Events

• Net income for the first quarter of 2016 was $5.2 million, an increase of $1.1 million from the prior-year period. Diluted earnings per share were $0.40 based on a diluted share count of 12.9 million.
• Total finance receivables as of March 31, 2016 were $607.4 million, an increase of 15.5% from the prior year and a decrease of 3.4% sequentially due to normal seasonality:
  • Large loan finance receivables as of March 31, 2016 were $162.3 million, an increase of 156.2% compared to the prior year and an increase of 10.7% sequentially.
  • Branch small loan and convenience check finance receivables, collectively, as of March 31, 2016 were $310.5 million, an increase of 6.5% over the prior year and a decrease of 8.2% sequentially due to normal seasonality.
• Total revenue for the first quarter of 2016 was $56.7 million, a $4.2 million, or 7.9%, increase from the prior-year period. Revenue growth over the prior-year period was driven by a 15.5% increase in receivables, partially offset by an overall yield decline of 270 basis points. On a sequential basis, yield declined by 20 basis points.
• Net charge-offs1 for the first quarter of 2016 were $15.0 million, or 9.7% of average finance receivables.
• Total delinquencies as a percentage of total finance receivables as of March 31, 2016 were a historical low of 16.7%, an improvement sequentially from 20.3% as of December 31, 2015 and from 19.2% as of March 31, 2015.
  • 30+ day contractual delinquencies as of March 31, 2016 were 6.2%, an improvement sequentially from 7.2% as of December 31, 2015 and from 6.3% as of March 31, 2015.
• During the first quarter of 2016, Regional Management repurchased 571,544 shares at a weighted-average price of $15.49 per share. As of April 27, 2016, Regional Management had repurchased $15.1 million of shares, leaving $9.9 million of availability remaining under Regional Management’s $25.0 million share repurchase program.
• Regional Management opened 8 new branches in the first quarter of 2016. As of March 31, 2016, Regional Management’s branch network consisted of 339 locations.

____________

1 Net charge-offs are reported on an annualized basis.

“Our first quarter performance continued the progress we saw throughout 2015, particularly on our top line and in our overall finance receivables,” said Michael R. Dunn, Chief Executive Officer of Regional Management Corp. “Our core products, led most prominently once again by our large and branch small loans, drove the 15.5% year-over-year growth in our portfolio, and of particular note, our large loan portfolio now comprises nearly 27% of our total loan portfolio. Our targeted focus on these areas helped mitigate the usual first quarter portfolio seasonal liquidation and primes us for another year of solid origination and portfolio growth.”

“In addition to the performance of our overall portfolio, our total and 30+ day delinquency levels at the end of the first quarter were at or near historically low levels – a testament to the ongoing improvements in our underwriting practices and credit metrics,” continued Mr. Dunn. “Overall, our focus remains on executing on our core product strategy, while continuing to invest in our operations throughout the year in order to firmly position us for long-term sustainable and profitable growth.”

First Quarter 2016 Results

Finance receivables outstanding at March 31, 2016 were $607.4 million, a 15.5% increase from $525.9 million in the prior year. Finance receivables increased primarily due to an increase in both Regional Management’s small and large loan portfolios and the addition of 33 de novo branches since March 31, 2015.

For the first quarter ended March 31, 2016, Regional Management reported total revenue of $56.7 million, a 7.9% increase from $52.5 million in the prior-year period. Interest and fee income for the first quarter of 2016 was $51.3 million, a 9.0% increase from $47.1 million in the prior-year period, primarily due to an increase in the portfolios of both small and large loans compared to the prior-year period and partially offset by lower interest and fee yield, primarily in the convenience check and branch small loan portfolios. Insurance income, net for the first quarter of 2016 was $2.9 million, comparable with the prior-year period. Other income for the first quarter of 2016 was $2.5 million, also comparable with the prior-year period.

Provision for credit losses in the first quarter of 2016 was $13.8 million versus $9.7 million in the prior-year period. Net charge-offs were $15.0 million in the first quarter of 2016 versus $13.3 million in the prior-year period. As a percentage of average finance receivables, net charge-offs for the first quarter of 2016 were 9.7%, a slight improvement from 9.9% in the prior-year period. The provision in the first quarter of 2015 was considerably lower than net charge-offs in that period due to a release of allowance related to the issuance of convenience checks to lower credit quality customers reported in the third quarter of 2014.

On a sequential basis, net charge-offs of $15.0 million were $1.3 million higher than the fourth quarter of 2015 (excluding the bulk sale of charged-off loans), consistent with the higher dollar amount of accounts in the last three delinquency buckets at December 31, 2015 compared to September 30, 2015. The higher delinquency levels in the second half of 2015 and the higher net charge-offs for the first quarter of 2016 were partially due to seasonality and partially due to tighter underwriting criteria implemented in the third quarter of 2015.

General and administrative expenses for the first quarter of 2016 were $29.8 million, a decrease of 8.6% from $32.6 million in the prior-year period, driven primarily by $2.2 million of improvement in home office expenses and $1.0 million in reduced marketing, and partially offset by a $0.4 million increase in branch expenses. Branch expenses include changes in staffing and incentive plans for all branches, as well as the expenses associated with 33 branches added since March 31, 2015. Excluding $0.4 million of loan system conversion costs in the first quarter of 2016 and excluding non-operating compensation-related costs of $2.1 million and loan system conversion costs of $0.6 million in the first quarter of 2015, general and administrative expenses for the first quarter of 2016 would have been $29.4 million versus $30.0 million in the prior-year period.

GAAP net income for the first quarter of 2016 was $5.2 million, a 26.8% increase compared to GAAP net income of $4.1 million in the prior-year period. Diluted earnings per share for the first quarter of 2016 were $0.40, an increase from $0.31 in the prior-year period. Excluding the aforementioned non-operating expenses in both periods, non-GAAP net income in the first quarter of 2016 would have been $5.4 million and diluted earnings per share would have been $0.42, compared to non-GAAP net income of $5.7 million and diluted earnings per share of $0.44 in the prior-year period. For a reconciliation of non-GAAP financial measures to the nearest comparable GAAP financial measure, please refer to the reconciliation table accompanying this release.

2016 De Novo Outlook

As of March 31, 2016, Regional Management’s branch network consisted of 339 locations. Regional Management opened 8 de novo branches in the first quarter of 2016 and, for the full year 2016, maintains its plans to open between 20 and 25 de novo branches.

Liquidity and Capital Resources

As of March 31, 2016, Regional Management had finance receivables of $607.4 million and outstanding long-term debt of $396.5 million (consisting of $332.7 million of long-term debt on its $538.0 million senior revolving credit facility and $63.8 million of long-term debt on its $75.7 million amortizing loan).

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) 590-2959 (toll-free) or (503) 343-6651 (direct), passcode 91371922. Please dial the number 10 minutes prior to the scheduled start time.

*** A supplemental slide presentation will be made available on Regional Management’s website prior to the earnings call at www.RegionalManagement.com. ***

In addition, a live webcast of the conference call will also be available on Regional Management’s website at www.RegionalManagement.com.

A replay will be available following the end of the call through Thursday, May 5, 2016, by telephone at (855) 859-2056 (toll-free) or (404) 537-3406 (direct), passcode 91371922. A webcast replay of the call will be available at www.RegionalManagement.com for one year following the call.

Forward-Looking Statements

This press release may contain various “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which represent Regional Management Corp.’s expectations or beliefs concerning future events. 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 are about matters that are inherently subject to risks and uncertainties, many of which are outside of the control of Regional Management. Factors that could cause actual results or performance to differ from the expectations expressed or implied in such forward-looking statements include, but are not limited to, the following: the continuation or worsening of adverse conditions in the global and domestic credit markets and uncertainties regarding, or the impact of, governmental responses to those conditions; changes in interest rates; risks related to acquisitions; risks related to opening new branches, including the ability or inability to open new branches as planned; risks inherent in making loans, including repayment risks and value of collateral, which risks may increase in light of adverse or recessionary economic conditions; recently-enacted or proposed legislation; the timing and amount of revenues that may be recognized by Regional Management; changes in current revenue and expense trends (including trends affecting delinquencies and charge-offs); changes in Regional Management’s markets and general changes in the economy (particularly in the markets served by Regional Management); changes in operating and administrative expenses; and the departure, transition or replacement of key personnel. Such factors and others are discussed in greater detail in Regional Management’s filings with the Securities and Exchange Commission. Regional Management will not and is 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.

About Regional Management Corp.

Regional Management Corp. (NYSE: RM) is a diversified specialty consumer finance company providing a broad array of loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies and other traditional lenders. Regional Management began operations in 1987 with four branches in South Carolina and has since expanded its branch network across South Carolina, Texas, North Carolina, Tennessee, Alabama, Oklahoma, New Mexico, Georgia and Virginia. Each of its loan products is structured on a fixed rate, fixed term basis with fully amortizing equal monthly installment payments and is repayable at any time without penalty. Regional Management’s loans are sourced through its multiple channel platform, including in its branches, through direct mail campaigns, independent and franchise automobile dealerships, online credit application networks, retailers and its consumer website. For more information, please visit www.RegionalManagement.com.

Regional Management Corp. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
(in thousands, except per share amounts)
																			Better (Worse)
					1Q’16							1Q’15							$							%
Revenue
Interest and fee income					$		51,300					$		47,065					$		4,235					9.0	%
Insurance income, net							2,939							2,929							10					0.3	%
Other income							2,458							2,530							(72	)				(2.8	)  %
Total revenue							56,697							52,524							4,173					7.9	%
Expenses
Provision for credit losses							13,791							9,712							(4,079	)				(42.0	)  %
Personnel							17,127							19,760							2,633					13.3	%
Occupancy							4,863							4,105							(758	)				(18.5	)  %
Marketing							1,515							2,471							956					38.7	%
Other							6,300							6,287							(13	)				(0.2	)  %
Total general and administrative							29,805							32,623							2,818					8.6	%
Interest expense							4,710							3,604							(1,106	)				(30.7	)  %
Income before income taxes							8,391							6,585							1,806					27.4	%
Income taxes							3,215							2,502							(713	)				(28.5	)  %
Net income					$		5,176					$		4,083					$		1,093					26.8	%
Net income per common share:
Basic					$		0.41					$		0.32					$		0.09					28.1	%
Diluted					$		0.40					$		0.31					$		0.09					29.0	%
Weighted-average shares outstanding:
Basic							12,756							12,838							(82	)				(0.6	)  %
Diluted							12,949							13,061							(112	)				(0.9	)  %
Return on average assets (annualized)							3.4	%						3.2	%
Return on average equity (annualized)							10.1	%						9.0	%

Regional Management Corp. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
(in thousands, except par value amounts)
																			Increase (Decrease)
					1Q’16							1Q’15							$							%
Assets
Cash					$		7,436					$		2,060					$		5,376					261.0	%
Gross finance receivables							761,294							638,809							122,485					19.2	%
Unearned finance charges, insurance premiums, and commissions							(153,931	)						(112,902	)						(41,029	)				(36.3	)  %
Finance receivables							607,363							525,907							81,456					15.5	%
Allowance for credit losses							(36,230	)						(36,950	)						720					1.9	%
Net finance receivables							571,133							488,957							82,176					16.8	%
Restricted cash							10,818							1,901							8,917					469.1	%
Property and equipment, net of accumulated depreciation							9,888							7,836							2,052					26.2	%
Intangible assets, net							2,907							1,166							1,741					149.3	%
Deferred tax asset, net							2,453							1,372							1,081					78.8	%
Goodwill							716							716							—					0.0	%
Repossessed assets at net realizable value							467							400							67					16.8	%
Other assets							3,889							2,592							1,297					50.0	%
Total assets					$		609,707					$		507,000					$		102,707					20.3	%
Liabilities and Stockholders’ Equity
Liabilities:
Long-term debt					$		396,543					$		312,538					$		84,005					26.9	%
Unamortized debt issuance costs							(2,443	)						(742	)						(1,701	)				(229.2	) %
Net long-term debt							394,100							311,796							82,304					26.4	%
Accounts payable and accrued expenses							13,685							10,905							2,780					25.5	%
Total liabilities							407,785							322,701							85,084					26.4	%
Commitments and Contingencies
Stockholders’ equity:
Preferred stock, $0.10 par value, 100,000 shares authorized, no sharesissued or outstanding							—							—							—					—
Common stock, $0.10 par value, 1,000,000 shares authorized, 12,939shares issued and 12,367 shares outstanding at March 31, 2016 and12,848 shares issued and outstanding at March 31, 2015							1,294							1,285							9					0.7	%
Additional paid-in-capital							89,565							87,538							2,027					2.3	%
Retained earnings							119,934							95,476							24,458					25.6	%
Treasury stock, at cost, 572 shares at March 31, 2016							(8,871	)						—							(8,871	)				(100.0	)  %
Total stockholders’ equity							201,922							184,299							17,623					9.6	%
Total liabilities and stockholders’ equity					$		609,707					$		507,000					$		102,707					20.3	%

Regional Management Corp. and Subsidiaries
Selected Financial Data
(Unaudited)
(in thousands, except per share amounts)
					Averages and Yields
					1Q’16										4Q’15										1Q’15
					Average FinanceReceivables					Average Yield       (Annualized)					Average FinanceReceivables					Average Yield       (Annualized)					Average FinanceReceivables					Average Yield       (Annualized)
Branch small loans					$		153,516			43.1	%				$		151,983			43.1	%				$		124,350			46.2	%
Convenience checks							172,133			40.8	%						180,395			41.4	%						181,425			45.9	%
Large loans							152,938			28.2	%						133,457			28.0	%						52,738			26.7	%
Automobile loans							111,008			18.2	%						122,049			18.4	%						150,107			19.2	%
Retail loans							27,923			19.2	%						26,453			19.4	%						25,121			18.2	%
Total interest and fee yield					$		617,518			33.2	%				$		614,337			33.4	%				$		533,741			35.3	%
Total revenue yield					$		617,518			36.7	%				$		614,337			36.9	%				$		533,741			39.4	%

					Components of Increase in Interest and Fee Income1Q’16 Compared to 1Q’15Increase (Decrease)
					Volume								Rate								Net
Branch small loans					$			3,196					$			(1,013	)				$			2,183
Convenience checks								(1,029	)							(2,211	)							(3,240	)
Large loans								7,047								200								7,247
Automobile loans								(1,796	)							(355	)							(2,151	)
Retail loans								133								63								196
Total increase (decrease) in interest and fee income					$			7,551					$			(3,316	)				$			4,235

					Net Loans Originated (1)
					1Q’16						4Q’15						QoQ $Inc (Dec)							QoQ %       Inc (Dec)					1Q’15						YoY $ Inc (Dec)							YoY %      Inc (Dec)
Branch small loans					$		58,399				$		81,074				$		(22,675	)				(28.0	) %				$		51,371				$		7,028					13.7	%
Convenience checks							55,978						83,230						(27,252	)				(32.7	) %						60,653						(4,675	)				(7.7	) %
Large loans							48,569						52,686						(4,117	)				(7.8	) %						29,829						18,740					62.8	%
Automobile loans							8,485						7,563						922					12.2	%						14,590						(6,105	)				(41.8	) %
Retail loans							8,701						8,978						(277	)				(3.1	) %						6,727						1,974					29.3	%
Total net loans originated					$		180,132				$		233,531				$		(53,399	)				(22.9	) %				$		163,170				$		16,962					10.4	%
(1) Represents the balance of loan origination and refinancing net of unearned finance charges

					Other Key Metrics
					1Q’16							4Q’15							1Q’15
Net charge-offs					$		15,013					$		11,783					$		13,273
Net charge-offs (bulk sale of charged-off loans)							—							1,964							—
Net charge-offs (excluding sale)					$		15,013					$		13,747					$		13,273
Percentage of average finance receivables (annualized)							9.7	%						9.0	%						9.9	%
Provision for credit losses					$		13,791					$		11,449					$		9,712
Provision for credit losses (bulk sale of charged-off loans)							—							1,964							—
Provision for credit losses (excluding sale)					$		13,791					$		13,413					$		9,712
Percentage of average finance receivables (annualized)							8.9	%						8.7	%						7.3	%
Percentage of total revenue							24.3	%						23.7	%						18.5	%
General and administrative expenses					$		29,805					$		28,550					$		32,623
Percentage of average finance receivables (annualized)							19.3	%						18.6	%						24.4	%
Percentage of total revenue							52.6	%						50.4	%						62.1	%
Same store results:
Finance receivables at period-end					$		552,313					$		599,415					$		501,393
Finance receivable growth rate							7.3	%						11.7	%						1.1	%
Number of branches in calculation							306							296							264

					Finance Receivables by Product
					1Q’16						4Q’15						QoQ $Inc (Dec)							QoQ %          Inc (Dec)				1Q’15						YoY $Inc (Dec)							YoY %          Inc (Dec)
Branch small loans					$		148,700				$		157,755				$		(9,055	)				(5.7	)  %			$		121,649				$		27,051					22.2	%
Convenience checks							161,802						180,402						(18,600	)				(10.3	)  %					170,013						(8,211	)				(4.8	)  %
Large loans							162,301						146,553						15,748					10.7	%					63,338						98,963					156.2	%
Total core loans							472,803						484,710						(11,907	)				(2.5	)  %					355,000						117,803					33.2	%
Automobile loans							106,297						116,109						(9,812	)				(8.5	)  %					146,724						(40,427	)				(27.6	)  %
Retail loans							28,263						27,625						638					2.3	%					24,183						4,080					16.9	%
Total finance receivables					$		607,363				$		628,444				$		(21,081	)				(3.4	)  %			$		525,907				$		81,456					15.5	%
Number of branches at period end							339						331						8					2.4	%					306						33					10.8	%
Average finance receivables per branch					$		1,792				$		1,899				$		(107	)				(5.6	)  %			$		1,719				$		73					4.2	%
					1Q’15						4Q’14						QoQ $ Inc (Dec)							QoQ % Inc (Dec)
Total finance receivables					$		525,907				$		546,192				$		(20,285	)				(3.7	)  %

					Contractual Delinquency by Aging
					1Q’16											4Q’15											1Q’15
Allowance for credit losses					$		36,230				6.0	%				$		37,452				6.0	%				$		36,950				7.0	%
Current							505,801				83.3	%						500,591				79.7	%						425,088				80.8	%
1 to 29 days past due							63,686				10.5	%						82,589				13.1	%						67,653				12.9	%
Delinquent accounts:
30 to 59 days							11,986				1.9	%						15,654				2.5	%						11,596				2.2	%
60 to 89 days							7,640				1.3	%						9,858				1.6	%						6,824				1.3	%
90 to 119 days							7,099				1.1	%						7,696				1.1	%						4,844				0.9	%
120 to 149 days							5,914				1.0	%						6,678				1.1	%						4,881				0.9	%
150 to 179 days							5,237				0.9	%						5,378				0.9	%						5,021				1.0	%
Total contractual delinquency					$		37,876				6.2	%				$		45,264				7.2	%				$		33,166				6.3	%
Total finance receivables					$		607,363				100.0	%				$		628,444				100.0	%				$		525,907				100.0	%
1 day and over past due					$		101,562				16.7	%				$		127,853				20.3	%				$		100,819				19.2	%

					Contractual Delinquency by Product
					1Q’16												4Q’15												1Q’15
Branch small loans					$		12,627					8.5	%				$		14,765					9.4	%				$		8,890					7.3	%
Convenience checks							12,351					7.6	%						15,420					8.5	%						14,681					8.6	%
Large loans							5,561					3.4	%						4,945					3.4	%						1,704					2.7	%
Automobile loans							6,120					5.8	%						8,713					7.5	%						6,854					4.7	%
Retail loans							1,217					4.3	%						1,421					5.1	%						1,037					4.3	%
Total contractual delinquency							37,876					6.2	%				$		45,264					7.2	%				$		33,166					6.3	%

					Quarterly Trend
					1Q’15						2Q’15						3Q’15						4Q’15						1Q’16						QoQ $      B(W)							YoY $      B(W)
Revenue
Interest and fee income					$		47,065				$		47,668				$		49,741				$		51,320				$		51,300				$		(20	)				$		4,235
Insurance income, net							2,929						3,120						2,767						2,838						2,939						101							10
Other income							2,530						2,213						2,588						2,527						2,458						(69	)						(72	)
Total revenue							52,524						53,001						55,096						56,685						56,697						12							4,173
Expenses
Provision for credit losses							9,712						12,102						14,085						11,449						13,791						(2,342	)						(4,079	)
Personnel							19,760						16,211						15,993						17,283						17,127						156							2,633
Occupancy							4,105						4,227						4,458						4,522						4,863						(341	)						(758	)
Marketing							2,471						2,009						1,134						1,403						1,515						(112	)						956
Other							6,287						5,796						4,597						5,342						6,300						(958	)						(13	)
Total general and administrative							32,623						28,243						26,182						28,550						29,805						(1,255	)						2,818
Interest expense							3,604						3,932						4,335						4,350						4,710						(360	)						(1,106	)
Income before income taxes							6,585						8,724						10,494						12,336						8,391						(3,945	)						1,806
Income taxes							2,502						3,316						3,987						4,969						3,215						1,754							(713	)
Net income					$		4,083				$		5,408				$		6,507				$		7,367				$		5,176				$		(2,191	)				$		1,093
Net income per common share:
Basic					$		0.32				$		0.42				$		0.51				$		0.57				$		0.41				$		(0.16	)				$		0.09
Diluted					$		0.31				$		0.41				$		0.50				$		0.56				$		0.40				$		(0.16	)				$		0.09
Weighted-average shares outstanding:
Basic							12,838						12,845						12,881						12,891						12,756						(135	)						(82	)
Diluted							13,061						13,078						13,111						13,105						12,949						(156	)						(112	)
Net interest margin							48,920						49,069						50,761						52,335						51,987						(348	)						3,067
Net credit margin							35,647						36,188						38,291						40,552						36,974						(3,578	)						1,327
					1Q’15						2Q’15						3Q’15						4Q’15						1Q’16						QoQ $Inc (Dec)							YoY $ Inc (Dec)
Total assets							507,000						560,351						587,508						626,373						609,707						(16,666	)						102,707
Finance receivables							525,907						572,525						601,608						628,444						607,363						(21,081	)						81,456
Allowance for credit losses							36,950						36,171						37,786						37,452						36,230						(1,222	)						(720	)
Long-term debt							312,538						359,491						379,617						411,177						396,543						(14,634	)						84,005

					Headcount Trend
					1Q’15				2Q’15				3Q’15				4Q’15				1Q’16				QoQ      Inc (Dec)					YoY     Inc (Dec)
Legacy branch headcount					1,288				1,245				1,256				1,280				1,237				(43	)				(51	)
2016 new branches																					17				17					17
Total branch headcount					1,288				1,245				1,256				1,280				1,254				(26	)				(34	)
Home office headcount					125				120				129				133				137				4					12
Total headcount					1,413				1,365				1,385				1,413				1,391				(22	)				(22	)
Number of branches					306				316				322				331				339				8					33

					General & Administrative Expenses Trend
					1Q’15						2Q’15						3Q’15						4Q’15						1Q’16						QoQ $   B(W)							YoY $   B(W)
Legacy branch G&A expenses					$		19,370				$		17,094				$		18,876				$		18,862				$		19,205				$		(343	)				$			165
2016 new branches																															548						(548	)							(548	)
Total branch G&A expenses							19,370						17,094						18,876						18,862						19,753						(891	)							(383	)
Marketing							2,471						2,009						1,134						1,403						1,515						(112	)							956
Home office G&A expenses							10,782						9,140						6,172						8,285						8,537						(252	)							2,245
Total G&A expenses					$		32,623				$		28,243				$		26,182				$		28,550				$		29,805				$		(1,255	)				$			2,818

Because it adjusts for certain non-operating and non-cash items, the Company believes that non-GAAP measures are useful to investors as supplemental financial measures that, when viewed with its GAAP financial information, provide information regarding trends in the Company’s results of operations and credit metrics, which is intended to help investors meaningfully evaluate and compare the Company’s results of operations and credit metrics between periods.

					Non-GAAP Reconciliation
					1Q’16								Adjustments									Non-GAAP
General and administrative expenses					$				29,805				$				(392	)(2)				$				29,413
Income taxes					$				3,215				$				150	(4)				$				3,365
Net income					$				5,176				$				242					$				5,418
Diluted net income per common share					$				0.40				$				0.02					$				0.42

					Non-GAAP Reconciliation
					1Q’15								Adjustments									Non-GAAP
General and administrative expenses					$				32,623				$				(2,672	)(1)(2)(3)				$				29,951
Income taxes					$				2,502				$				1,015	(4)				$				3,517
Net income					$				4,083				$				1,657					$				5,740
Diluted net income per common share					$				0.31				$				0.13					$				0.44

(1)		Exclude executive retirement agreement costs of $533
(2)		Exclude loan system conversion costs of $392 and $609 for 1Q’16 and 1Q’15
(3)		Exclude CEO equity award costs of $1,530
(4)		Tax effect of the adjustments

View source version on businesswire.com: http://www.businesswire.com/news/home/20160428006881/en/

For Regional Management Corp.
Investor Relations
Garrett Edson, 203-682-8331

Source: Regional Management Corp.