America's Car Mart (NASDAQ: CRMT) reported Q3 EPS of $0.47, $0.03 worse than the analyst estimate of $0.50. Revenue for the quarter came in at $137 million versus the consensus estimate of $132.35 million.

“We are very proud of our Company and our 35 year history of expanding our footprint to new communities. With our growth and the changes we have seen in the industry, it is time to make a few management structure changes that we believe will allow us to continue our success out into the future,” said William H. (“Hank”) Henderson, Chief Executive Officer of America’s Car-Mart, Inc. (the “Company”). “We have promoted Leon Walthall to the newly created position of Field Operations Officer where he will be leading our Regional Vice Presidents of Operations. Leon has been with the Company for over 27 years and has had tremendous success both as a General Manager and for the last six years as a Regional Vice President. Jeff Williams, our Chief Financial Officer for the last 10 years, will assume additional responsibilities as our President. We are very excited for Leon and Jeff and appreciate their hard-work and dedication to the Company. I am confident that expanding their scope of influence will be very beneficial and a move in the right direction to realizing the true potential of our Company.”

“We feel good about the quality of the vehicles we are selling and the credit profiles of our customers. However, we continue to struggle with our sales volumes as we haven’t yet seen relief from the operating environment. There is no doubt that competition is still very intense and January was particularly weak from a sales volume perspective. In addition to the high level of competition, we also attribute the volume challenges to us being more conservative with our underwriting and to a delay in income tax refunds this year compared to last,” added Mr. Henderson. “Even with the volume shortfall we were able to show good, solid growth at the top line for the quarter, something we are very proud of and something that we can build on as we move forward. We will continue to work hard on the expense side of the business as we move to improve productivity. We will adjust accordingly and as always continue to try to find just the right balance between risk and volume.”

“As Hank mentioned, one of our biggest challenges right now is finding our footing on the volume side and making sure our infrastructure costs are in alignment. Our cash on cash returns for the deals we are writing are solid, but we are struggling with attracting enough good, solid deals in this environment. While we still believe we will grow into our cost structure, which was created with the view of supporting much higher volumes, that was certainly not the case this quarter and we are making adjustments, including pushing for higher volumes,” said Jeff Williams, Chief Financial Officer for America’s Car-Mart, Inc. “It has been a very difficult market to read, and competitive forces are intense. We will continue to pursue our mission of striving to earn the repeat business of our customers by providing quality vehicles, affordable payment terms and excellent service. We believe more firmly than ever that supporting our customers with a face-to-face relationship is the best way to serve our market.”

“Our debt to equity ratio is 53.5% and our debt to receivables ratio is 27.6%, up from 24.6% at April 30, 2015. We re-purchased 252,513 shares for $6.5 million for an average cost of $25.73 per share during the quarter, and since February 10, 2010, we have repurchased 4 million shares, or 34% of our Company, for $131 million at an average cost of $32.76 per share. To support our growth and any potential future repurchases, today we exercised an option under our existing credit agreement to increase our revolving credit facilities by $27.5 million from $145 million to $172.5 million,” added Mr. Williams. “As always, we are focused on cash flows and growing value over the long-term. Since January 31, 2015, we have repurchased almost $17 million in common stock, incurred $6 million in capital expenditures, grown finance receivables by $18 million and inventory by $4 million, which will decrease back down during the fourth quarter, with only a $10 million increase in debt.”

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