BENTONVILLE, Ark., Nov. 19, 2010 (GLOBE NEWSWIRE) -- America's Car-Mart, Inc. (Nasdaq:CRMT) today announced its operating results for its second fiscal quarter ended October 31, 2010. The Company repurchased 168,230 shares of its common stock during the quarter, representing approximately 1.5% of the outstanding shares.
Highlights of second quarter operating results:
- Net income of $.56 per diluted share vs. $.53 per diluted share for prior year quarter (5.7% increase in diluted earnings per share)
- Revenue increase of 11.2% to $91.8 million from $82.6 million with same store revenue growth of 8.1%
- Retail unit sales increase of 5.9% to 8,431 from 7,965 for the prior year quarter
- Strong cash flows supporting the significant increase in revenues as well as the $4.5 million increase in Finance Receivables, $1.1 million in net capital expenditures, $7.4 million in income tax payments and $3.8 million in common stock re-purchases with only a $6.9 million increase in debt
- Active customer base now over 49,000
- Debt to equity of 28.3% and debt to finance receivables of 18.5%
- Allowance for credit losses remains unchanged at 22% of Finance Receivables
Highlights of six month operating results:
- Net income of $1.25 per diluted share vs. $1.13 per diluted share for prior year period (10.6% increase in diluted earnings per share)
- Active customer base increased 4.5% to over 49,000 during the six months ended October 31, 2010
- Revenue increase of 10.2% with same store revenue growth of 7.2%
- Retail unit sales increase of 4.7%
- Provision for credit losses of 21.1% of sales vs. 19.8% for prior year period
- Strong cash flows with Finance Receivables growth of $16 million, capital expenditures of $2.2 million, $11 million in common stock re-purchases with only a $12.4 million increase in debt
"Our financial results for the quarter were solid, but short of our own internal expectations. The uptick in our credit losses means we've got to do a better job taking care of our customers. Our commitment to helping our customers succeed has always been a cornerstone of our success and this will not change as we move forward," said William H. ("Hank") Henderson, President and Chief Executive Officer of America's Car-Mart.
"Our new store openings are going very well and we are on pace. We have added 4 great locations so far in fiscal 2011 and we have 4 more in the works that we intend to have in operation by the end of the fiscal year," added Mr. Henderson. "While we expect that most of our top line growth year to year will come from existing stores, the contributions of these new locations will be an important factor in keeping us on our projected growth targets. Our biggest promotion of the year, the "Zero Down" tax promotion is off to a great start and we look forward to reporting the success for this program next quarter."
"Our long-term financial goals remain firmly in place. Our balance sheet is strong and we are pleased with our new loan package with Bank of America and Bank of Arkansas as the primary lenders. These banks are familiar with our industry and we expect that the current lending group will grow with us into the future," said Jeff Williams, Chief Financial Officer of America's Car-Mart. "The loan package contains revolving loan commitments totaling $90 million along with a $15 million accordion feature. Excess availability was $38.8 million at the end of the quarter. We continue to focus on cash returns by ensuring that our customers have equity in their vehicles throughout the term of their contracts. We are expecting strong collections during the spring months this year based on some operational and software changes that have recently been installed."
"The company repurchased 168,230 shares, or 1.5%, of its common stock during the second quarter and 917,762 shares, or approximately 8% since February," added Mr. Williams. "We believe in the long-term value of our company and we expect to continue to invest in the repurchase program. We have approximately 900,000 shares available to repurchase under our existing repurchase program. Our debt to equity ratio of 28.3% and our debt to finance receivables ratio of 18.5% continue to be strong and what we consider to be the best in the industry. The ratios are even more impressive when considering the fact that we have repurchased almost $22 million of common stock and added approximately $16 million in finance receivables since February 1, 2010."
"We are happy to report that on November 2, 2010 the voters in Arkansas approved a state constitutional amendment to allow up to 17% interest for non-bank loans and contracts in the state. This amendment removes the major unknown we were facing as to interest rates we could charge to our Arkansas customers," said Mr. Williams.
Conference Call
Management will be holding a conference call on Friday, November 19, 2010 at 11:00 a.m. Eastern time to discuss second quarter results. A live audio of the conference call will be accessible to the public by calling (877) 776-4031. International callers dial (631) 291-4132. Callers should dial in approximately 10 minutes before the call begins. A conference call replay will be available one hour following the call for thirty days and can be accessed by calling (800) 642-1687 (domestic) or (706) 645-9291 (international), conference call ID #23430965.
About America's Car-Mart
America's Car-Mart, Inc. (the "Company") operates 101 automotive dealerships in eight states and is the largest publicly held automotive retailer in the United States focused exclusively on the "Integrated Auto Sales and Finance" segment of the used car market. The Company emphasizes superior customer service and the building of strong personal relationships with its customers. The Company operates its dealerships primarily in small cities throughout the South-Central United States selling quality used vehicles and providing financing for substantially all of its customers. For more information, including investor presentations, on America's Car-Mart, please visit our website at www.car-mart.com.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements address the Company's future objectives, plans and goals, as well as the Company's intent, beliefs and current expectations regarding future operating performance, and can generally be identified by words such as "may," "will," "should," "could, "believe," "expect," "anticipate," "intend," "plan," "foresee," and other similar words or phrases. Specific events addressed by these forward-looking statements include, but are not limited to:
- new store openings;
- same store revenue growth;
- future overall revenue growth;
- the Company's collection results;
- repurchases of the Company's common stock;
- the Company's business and growth strategies.
These forward-looking statements are based on the Company's current estimates and assumptions and involve various risks and uncertainties. As a result, you are cautioned that these forward-looking statements are not guarantees of future performance, and that actual results could differ materially from those projected in these forward-looking statements. Factors that may cause actual results to differ materially from the Company's projections include, but are not limited to:
- the availability of credit facilities to support the Company's business;
- the Company's ability to underwrite and collect its loans effectively;
- competition;
- dependence on existing management;
- availability of quality vehicles at prices that will be affordable to customers;
- changes in lending laws or regulations; and
- general economic conditions in the markets in which the Company operates, including but not limited to fluctuations in gas prices, grocery prices and employment levels.
Additionally, risks and uncertainties that may affect future results include those described from time to time in the company's SEC filings. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.
| America's Car-Mart, Inc. | ||||||||||
| Consolidated Results of Operations | ||||||||||
| (Operating Statement Dollars in Thousands) | ||||||||||
| % Change | As a % of Sales | |||||||||
| Three Months Ended | 2010 | Three Months Ended | ||||||||
| October 31, | vs. | October 31, | ||||||||
| 2010 | 2009 | 2009 | 2010 | 2009 | ||||||
| Operating Data: | ||||||||||
| Retail units sold | 8,431 | 7,965 | 5.9 % | |||||||
| Average number of stores in operation | 99 | 96 | 3.1 | |||||||
| Average retail units sold per store per month | 28.4 | 27.7 | 2.5 | |||||||
| Average retail sales price | $ 9,209 | $ 9,024 | 2.1 | |||||||
| Same store revenue growth | 8.1% | 11.4% | ||||||||
| Net charge-offs as a percent of average Finance Receivables | 6.5% | 5.3% | ||||||||
| Collections as a percent of average Finance Receivables | 16.2% | 16.2% | ||||||||
| Average percentage of Finance Receivables-Current (excl. 1-2 day) | 81.3% | 83.7% | ||||||||
| Average down-payment percentage | 6.8% | 6.9% | ||||||||
| Period End Data: | ||||||||||
| Stores open | 101 | 96 | 5.2 % | |||||||
| Accounts over 30 days past due | 3.9% | 3.4% | -- | |||||||
| Finance Receivables, gross | $ 277,022 | $ 253,719 | 9.2 % | |||||||
| Operating Statement: | ||||||||||
| Revenues: | ||||||||||
| Sales | $ 82,611 | $ 75,242 | 9.8 % | 100.0 % | 100.0 % | |||||
| Interest income | 9,224 | 7,319 | 26.0 | 11.2 | 9.7 | |||||
| Total | 91,835 | 82,561 | 11.2 | 111.2 | 109.7 | |||||
| Costs and expenses: | ||||||||||
| Cost of sales | 47,269 | 42,318 | 11.7 | 57.2 | 56.2 | |||||
| Selling, general and administrative | 14,684 | 13,964 | 5.2 | 17.8 | 18.6 | |||||
| Provision for credit losses | 18,767 | 15,152 | 23.9 | 22.7 | 20.1 | |||||
| Interest expense | 753 | 683 | 10.2 | 0.9 | 0.9 | |||||
| Interest expense- change in fair value of Interest Rate Swap | 50 | 93 | -- | 0.1 | 0.1 | |||||
| Depreciation and amortization | 465 | 412 | 12.9 | 0.6 | 0.5 | |||||
| Total | 81,988 | 72,622 | 12.9 | 99.3 | 96.5 | |||||
| Income before taxes | 9,847 | 9,939 | 11.9 | 13.2 | ||||||
| Provision for income taxes | 3,658 | 3,627 | 4.4 | 4.8 | ||||||
| Net income | $ 6,189 | $ 6,312 | 7.5 | 8.4 | ||||||
| Dividends on subsidiary preferred stock | $ (10) | $ (10) | ||||||||
| Net income attributable to common shareholders | $ 6,179 | $ 6,302 | ||||||||
| Earnings per share: | ||||||||||
| Basic | $ 0.57 | $ 0.54 | ||||||||
| Diluted | $ 0.56 | $ 0.53 | ||||||||
| Weighted average number of shares outstanding: | ||||||||||
| Basic | 10,892,177 | 11,732,151 | ||||||||
| Diluted | 11,117,087 | 11,862,679 | ||||||||
| America's Car-Mart, Inc. | |||||
| Consolidated Results of Operations | |||||
| (Operating Statement Dollars in Thousands) | |||||
| % Change | As a % of Sales | ||||
| Six Months Ended | 2010 | Six Months Ended | |||
| October 31, | vs. | October 31, | |||
| 2010 | 2009 | 2009 | 2010 | 2009 | |
| Operating Data: | |||||
| Retail units sold | 16,912 | 16,147 | 4.7 % | ||
| Average number of stores in operation | 99 | 95 | 4.2 | ||
| Average retail units sold per store per month | 28.5 | 28.3 | 0.7 | ||
| Average retail sales price | $ 9,225 | $ 9,033 | 2.1 | ||
| Same store revenue growth | 7.2% | 9.9% | |||
| Net charge-offs as a percent of average Finance Receivables | 11.6% | 10.4% | |||
| Collections as a percent of average Finance Receivables | 32.5% | 32.8% | |||
| Average percentage of Finance Receivables-Current (excl. 1-2 day) | 82.0% | 83.4% | |||
| Average down-payment percentage | 7.0% | 6.9% | |||
| Period End Data: | |||||
| Stores open | 101 | 96 | 5.2 % | ||
| Accounts over 30 days past due | 3.9% | 3.4% | |||
| Finance Receivables, gross | $ 277,022 | $ 253,719 | 9.2 % | ||
| Operating Statement: | |||||
| Revenues: | |||||
| Sales | $ 165,213 | $ 152,254 | 8.5 % | 100.0 % | 100.0 % |
| Interest income | 18,082 | 14,062 | 28.6 | 10.9 | 9.2 |
| Total | 183,295 | 166,316 | 10.2 | 110.9 | 109.2 |
| Costs and expenses: | |||||
| Cost of sales | 93,702 | 85,400 | 9.7 | 56.7 | 56.1 |
| Selling, general and administrative | 29,475 | 27,887 | 5.7 | 17.8 | 18.3 |
| Provision for credit losses | 34,905 | 30,203 | 15.6 | 21.1 | 19.8 |
| Interest expense | 1,487 | 1,249 | 19.1 | 0.9 | 0.8 |
| Interest expense (income)- change in fair value of Interest Rate Swap | 283 | (226) | -- | 0.2 | (0.1) |
| Depreciation and amortization | 920 | 804 | 14.4 | 0.6 | 0.5 |
| Total | 160,772 | 145,317 | 10.6 | 97.3 | 95.4 |
| Income before taxes | 22,523 | 20,999 | 13.6 | 13.8 | |
| Provision for income taxes | 8,369 | 7,659 | 5.1 | 5.0 | |
| Net income | $ 14,154 | $ 13,340 | 8.5 | 8.8 | |
| Dividends on subsidiary preferred stock | $ (20) | $ (20) | |||
| Net income attributable to common shareholders | $ 14,134 | $ 13,320 | |||
| Earnings per share: | |||||
| Basic | $ 1.28 | $ 1.14 | |||
| Diluted | $ 1.25 | $ 1.13 | |||
| Weighted average number of shares outstanding: | |||||
| Basic | 11,057,977 | 11,731,100 | |||
| Diluted | 11,276,850 | 11,827,588 | |||
| America's Car-Mart, Inc. | ||
| Consolidated Balance Sheet and Other Data | ||
| (Dollars in Thousands) | ||
| October 31, | April 30, | |
| 2010 | 2010 | |
| Cash and cash equivalents | $ 226 | $ 268 |
| Finance receivables, net | $ 217,988 | $ 205,423 |
| Total assets | $ 269,203 | $ 251,272 |
| Total debt | $ 51,212 | $ 38,766 |
| Treasury Stock | $ 28,566 | $ 17,528 |
| Stockholders' equity | $ 180,900 | $ 176,190 |
| Shares outstanding | 10,854,332 | 11,337,677 |
| Finance receivables: | ||
| Principal balance | $ 277,022 | $ 261,051 |
| Deferred Revenue -- Payment Protection Plan | $ (8,597) | $ (8,229) |
| Allowance for credit losses | (59,034) | (55,628) |
| Finance receivables, net of allowance & deferred revenue | $ 209,391 | $ 197,194 |
| Allowance as % of net principal balance | 22.0% | 22.0% |
| Changes in allowance for credit losses: | ||
| Six Months Ended | ||
| October 31, | ||
| 2010 | 2009 | |
| Balance at beginning of year | $ 55,628 | $ 49,310 |
| Provision for credit losses | 34,905 | 30,203 |
| Net charge-offs | (31,499) | (25,427) |
| Change in allowance related to purchased accounts | -- | (31) |
| Balance at end of period | $ 59,034 | $ 54,055 |