BENTONVILLE, Ark., Nov. 20, 2009 (GLOBE NEWSWIRE) -- America's Car-Mart, Inc. (Nasdaq:CRMT) today announced its operating results for the second fiscal quarter ended October 31, 2009.
Highlights of second quarter operating results:
* Net income of $6.3 million ($.53 per diluted share) vs. $3.9 million ($.33 per diluted share) for prior year quarter * Active customer base increased 3.3% to over 45,500 during the quarter ended October 31, 2009 * Revenue increase of 14.7% with same store revenue growth of 11.4% * Retail unit sales increase of 14.5% * Provision for credit losses of 20.1% of sales vs. 22.0% for prior year quarter * Accounts over 30 days past due of 3.4% at October 31, 2009 compared to 3.8% at October 31, 2008 * Net charge-offs as a percentage of average Finance Receivables decreased to 5.3% from 6.2% for the prior year quarter * Gross margin of 43.8% of sales vs. 42.8% for prior year quarter * Strong cash flows with Finance Receivables growth of $9 million to $254 million, capital expenditures of $1.3 million with only a $3.6 million increase in debt * Debt to equity of 19.96% and debt to finance receivables of 13.5%
For the three months ended October 31, 2009, revenues increased 14.7% to $82.6 million compared with $72.0 million in the same period of the prior year. Income for the quarter was $6.3 million or $.53 per diluted share, versus $3.9 million, or $0.33 per diluted share in the same period last year. Retail unit sales increased 14.5%, with 7,965 vehicles sold in the current quarter, compared to 6,958 in the same period last year. Same store revenue increased 11.4% for the quarter. The provision for credit losses was 20.1% of sales compared to 22.0% in the same period last year. Net charge-offs as a percentage of average finance receivables was 5.3% compared to 6.2% in the same period last year. Gross profit on vehicle sales was 43.8% for the quarter compared to 42.8% for the prior year quarter. Finance Receivables grew by $9 million during the quarter or 3.7%. The allowance for credit losses is 22% of Finance Receivables principal balance at both October 31, 2009 and 2008.
Highlights of six month operating results:
* Net income of $13.3 million ($1.13 per diluted share) vs. $9.2 million ($.78 per diluted share) for prior year period * Active customer base increased 17% to over 45,500 for the six months ended October 31, 2009 * Revenue increase of 12.6% with same store revenue growth of 9.9% * Retail unit sales increase of 12.8% * Provision for credit losses of 19.8% of sales vs. 21.5% for prior year period * Net charge-offs as a percentage of average Finance Receivables decreased to 10.4% from 11.9% for the prior year period. Collections as a percentage of average Finance Receivables increased to 32.8% from 32.6% for the prior year. * Gross margin of 43.9% of sales vs. 43.2% for prior year period * Strong cash flows with Finance Receivables growth of $22.3 million, capital expenditures of $2.3 million with only a $4.4 million increase in debt
For the six months ended October 31, 2009, revenues increased 12.6% to $166.3 million compared with $147.6 million in the same period of the prior year. Income for the six months was $13.3 million or $1.13 per diluted share, versus $9.2 million, or $0.78 per diluted share in the same period last year. Retail unit sales increased 12.8%, with 16,147 vehicles sold during the six months, compared to 14,311 in the same period last year. Same store revenue increased 9.9% for the six months. The provision for credit losses was 19.8% of sales compared to 21.5% in the same period last year. Net charge-offs as a percentage of average finance receivables was 10.4% compared to 11.9% in the same period last year. Gross profit on vehicle sales was 43.9% for the quarter compared to 43.2% for the prior year period. Finance Receivables grew by $22.3 million during the six months or 9.7%.
"We continue to see benefits from our significant infrastructure investments made over the last few years. We are very pleased with our second quarter results and see it as a testament to the strength of our business model," said William H. ("Hank") Henderson, President and Chief Executive Officer of America's Car-Mart. "The Car-Mart brand continues to gain momentum as more and more people recognize the great value we provide for good, affordable basic transportation and flexible financing to go with it. Our top line growth has improved as we continue to focus on increasing per location volume levels, especially for our newer stores. We believe we continue to gain market share by building on our successful branding campaign coupled with continuous improvements in execution at the lot level supported by oversight from the corporate level. We anticipate the demand for our vehicles and service to continue to increase into the future. Continuing credit constrictions for vehicle consumers and most of our competitors will enhance Car-Mart's position as the leader in our industry. Our mission is to strive to earn the repeat business of our customers by providing quality vehicles, affordable payment terms, and excellent service. Our associates understand this mission and as a result our future is bright."
"Our future growth plans include pushing for higher sales volumes at all of our existing locations as well as continuing our 'grass-fire' growth approach in adding new locations," continued Mr. Henderson. "The 14.7% increase for our top line resulted from an 11.4% increase in same store sales and sales generated at our five new locations added since the second quarter of fiscal 2009. By continuing to re-invest our profits in our business, we will not only enhance the value we provide our customers but we will also provide growth opportunities to our talented associates allowing them to grow and advance individually into the future. The credit performance of our loans continues to be strong as evidenced by the 20.1% credit loss result compared to 22.0% for last year's second quarter. The execution level of our associates in the collections area continues to improve and we are doing an outstanding job of working with customers to minimize delinquencies and losses. These efforts are certainly showing up in our numbers. Once again, while we are pleased with our current results, we fully realize that we have a lot of work to do to reach our potential over the longer term. We have a team in place to take us to the next level and are excited about our future. On another note, our $0 down tax promotion began at the end of October and, as expected, has been very well received by our customers. We expect to see increasing benefits from this program as we move forward and view this promotion as another way to leverage Car-Mart's strengths against our competition."
"We are seeing some benefit from overall credit constrictions as well as a general shift in consumer sentiment toward good, basic, affordable transportation. We expect this mindset to continue for the foreseeable future. Car-Mart is uniquely positioned to fill this need in the markets we serve and we expect to continue to see benefits. Our service is non-discretionary in many respects and we will continue to invest in the business to ensure we provide the best possible product to our customers," said Jeff Williams, Chief Financial Officer of America's Car-Mart. "From a financial standpoint, we are pleased but not content with our results and expect continuing improvements. We have been able to keep our average selling price relatively flat with the prior year's quarter and actually down sequentially for the last two quarters. This lower selling price not only keeps our vehicles more affordable for our customers but also helps provide for a higher gross margin percentage which was up 100 bps from the prior year quarter to 43.8%. A lower sales price can also positively affect future credits losses. For the quarter, we saw strong cash flows which allowed us to grow our customer count by over 1,400 and the resulting receivable dollars by over $9 million together with capital expenditures of $1.3 million with only a $3.6 million increase in overall debt levels. Our debt to equity and debt to finance receivables ratios of 19.96% and 13.5%, respectively, continue to be very strong and are further indicators of the strength of our operations and business model. Our charge-off percentage was down, the average percentage of finance receivables-current was up and our accounts over 30 days past due was down, all positive indicators of the quality of the portfolio. Similarly, our provision for credit losses of 20.1% as a percentage of sales was low by historical standards and something we are very pleased with."
Conference Call
Management will be holding a conference call on Friday, November 20, 2009 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 (888) 661-5144. International callers dial (913) 312-1437. 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 (888) 203-1112 (domestic) or (719) 457-0820 (international), conference call ID #1343376.
About America's Car-Mart
America's Car-Mart operates 96 automotive dealerships in eight states and is the largest publicly held automotive retailer in the United States focused exclusively on the "Buy Here/Pay Here" 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 on America's Car-Mart, please visit our website at www.car-mart.com.
Included herein are forward-looking statements, including statements with respect to projected revenues and earnings per share amounts. Such forward-looking statements are based upon management's current knowledge and assumptions. There are many factors that affect management's view about future revenues and earnings. These factors involve risks and uncertainties that could cause actual results to differ materially from management's present view. These factors include, without limitation, assumptions relating to unit sales, average selling prices, credit losses, gross margins, operating expenses, collection results, operational initiatives underway and economic conditions, and other risk factors described under "Forward-Looking Statements" of Item 1A of Part I of the Company's Annual Report on Form 10-K for the fiscal year ended April 30, 2009 and its current and quarterly reports filed with or furnished to the Securities and Exchange Commission. All forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company does not undertake any obligation to update forward-looking statements.
America's Car-Mart, Inc.
Consolidated Results of Operations
(Operating Statement Dollars in Thousands)
% As a %
Change of Sales
------ --------------
Three Months Ended 2009 Three Months
October 31, vs. Ended Oct. 31,
2009 2008 2008 2009 2008
---------- ---------- ------ ------ ------
Operating Data:
Retail units sold 7,965 6,958 14.5%
Average number of
stores in operation 96 91 5.5
Average retail units
sold per store
per month 27.7 25.5 8.6
Average retail
sales price $ 9,024 $ 8,913 1.3
Same store revenue
growth 11.4% 5.3%
Net charge-offs as
a percent of
average Finance
Receivables 5.3% 6.2%
Collections as a
percent of average
Finance Receivables 16.2% 16.3%
Average percentage
of Finance
Receivables-Current
(excl. 1-2 day) 83.7% 81.5%
Average down-payment
percentage 6.9% 7.0%
Period End Data:
Stores open 96 91 5.5%
Accounts over 30
days past due 3.4% 3.8% --
Finance Receivables,
gross $ 253,719 $ 223,539 13.5%
Operating Statement:
Revenues:
Sales $ 75,242 $ 65,413 15.0% 100.0% 100.0%
Interest income 7,319 6,570 11.4 9.7 10.0
---------- ---------- ------ ------
Total 82,561 71,983 14.7 109.7 110.0
---------- ---------- ------ ------
Costs and expenses:
Cost of sales 42,318 37,437 13.0 56.2 57.2
Selling, general and
administrative 13,964 12,500 11.7 18.6 19.1
Provision for credit
losses 15,152 14,421 5.1 20.1 22.0
Interest expense 683 629 8.6 0.9 1.0
Interest expense-
change in fair value
of Interest Rate
Swap 93 481 -- 0.1 0.7
Depreciation and
amortization 412 338 21.9 0.5 0.5
---------- ---------- ------ ------
Total 72,622 65,806 10.4 96.5 100.6
---------- ---------- ------ ------
Income before taxes 9,939 6,177 13.2 9.4
Provision for income
taxes 3,627 2,296 4.8 3.5
---------- ---------- ------ ------
Net income $ 6,312 $ 3,881 8.4 5.9
========== ========== ====== ======
Dividends on
subsidiary preferred
stock $ (10) $ (10)
---------- ----------
Net income
attributable to
common shareholders $ 6,302 $ 3,871
========== ==========
Earnings per share:
Basic $ 0.54 $ 0.33
Diluted $ 0.53 $ 0.33
Weighted average
number of shares
outstanding:
Basic 11,732,151 11,760,421
Diluted 11,862,679 11,825,806
America's Car-Mart, Inc.
Consolidated Results of Operations
(Operating Statement Dollars in Thousands)
% As a
Change % of Sales
------ --------------
Six Months Ended 2009 Six Months
October 31, vs. Ended Oct. 31,
2009 2008 2008 2009 2008
---------- ---------- ------ ------ ------
Operating Data:
Retail units sold 16,147 14,311 12.8%
Average number of
stores in operation 95 91 4.4
Average retail units
sold per store
per month 28.3 26.2 8.0
Average retail
sales price $ 9,033 $ 8,933 1.1
Same store
revenue growth 9.9% 16.0%
Net charge-offs as
a percent of
average Finance
Receivables 10.4% 11.9%
Collections as a
percent of average
Finance Receivables 32.8% 32.6%
Average percentage of
Finance Receivables-
Current (excl.
1-2 day) 83.4% 81.5%
Average down-payment
percentage 6.9% 6.8%
Period End Data:
Stores open 96 91 5.5%
Accounts over 30
days past due 3.4% 3.8%
Finance Receivables,
gross $ 253,719 $ 223,539 13.5%
Operating Statement:
Revenues:
Sales $ 152,254 $ 134,639 13.1% 100.0% 100.0%
Interest income 14,062 13,005 8.1 9.2 9.7
---------- ---------- ------ ------
Total 166,316 147,644 12.6 109.2 109.7
---------- ---------- ------ ------
Costs and expenses:
Cost of sales 85,400 76,463 11.7 56.1 56.8
Selling, general
and administrative 27,887 25,309 10.2 18.3 18.8
Provision for
credit losses 30,203 28,912 4.5 19.8 21.5
Interest expense 1,249 1,308 (4.5) 0.8 1.0
Interest expense
(income)- change
in fair value of
Interest Rate Swap (226) 494 -- (0.1) 0.4
Depreciation and
amortization 804 657 22.4 0.5 0.5
---------- ---------- ------ ------
Total 145,317 133,143 9.1 95.4 98.9
---------- ---------- ------ ------
Income before taxes 20,999 14,501 13.8 10.8
Provision for
income taxes 7,659 5,329 5.0 4.0
---------- ---------- ------ ------
Net income $ 13,340 $ 9,172 8.8 6.8
========== ========== ====== ======
Dividends on
subsidiary preferred
stock $ (20) $ (20)
---------- ----------
Net income
attributable to
common shareholders $ 13,320 $ 9,152
========== ==========
Earnings per share:
Basic $ 1.14 $ 0.78
Diluted $ 1.13 $ 0.78
Weighted average
number of shares
outstanding:
Basic 11,731,100 11,733,571
Diluted 11,827,588 11,807,141
America's Car-Mart, Inc.
Consolidated Balance Sheet and Other Data
(Dollars in Thousands)
October 31, April 30,
2009 2009
------------- -------------
Cash and cash equivalents $ 229 $ 168
Finance receivables, net $ 199,664 $ 182,041
Total assets $ 240,478 $ 219,624
Total debt $ 34,201 $ 29,839
Stockholders' equity $ 171,354 $ 156,977
Shares outstanding 11,732,151 11,729,181
Finance receivables:
Principal balance $ 253,719 $ 231,351
Deferred Revenue - Payment
Protection Plan $ (8,014) $ (7,353)
Allowance for credit losses (54,055)(a) (49,310)
------------- -------------
Finance receivables, net of allowance
& deferred revenue $ 191,650 $ 174,688
============= =============
Allowance as % of net principal
balance 22.00% 22.01%(a)
============= =============
(a) Represents the weighted average for Finance Receivables
generated by the Company (at 22.0%) and purchased Finance Receivables.
Changes in allowance for credit losses:
Six Months Ended
October 31,
2009 2008
------------- -------------
Balance at beginning of year $ 49,310 $ 44,809
Provision for credit losses 30,203 28,912
Net charge-offs (25,427) (26,028)
Change in allowance related to
purchased accounts (31) --
------------- -------------
Balance at end of period $ 54,055 $ 47,693
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