America's Car-Mart Reports Diluted Earnings per Share of $6.19 on Record Revenues of $279 Million

Rogers, Arkansas, UNITED STATES


ROGERS, Ark., May 24, 2021 (GLOBE NEWSWIRE) -- America’s Car-Mart, Inc. (NASDAQ: CRMT) today announced its operating results for the fourth quarter and full fiscal year 2021, including net income of $43.5 million, or diluted earnings per share of $6.19, for the quarter ended April 30, 2021. The fourth quarter fiscal 2021 results include a $15.1 million (diluted earnings per share increase of $1.65) pretax decrease to the allowance for credit losses. These results compare to net income of $9.3 million, or diluted earnings per share of $1.35, for the quarter ended April 30, 2020. The prior year quarter included an $11.7 million (diluted earnings per share decrease of $1.42) pretax charge to increase the allowance for credit losses due to the COVID-19 pandemic.

“We are pleased with our results and are optimistic about our ability to continue to grow the Company as we move forward. We have a unique position in the market and believe that we have an obligation to serve significantly more customers - we improve lives by reducing stress related to our customers’ local transportation needs. We give our customers peace of mind by keeping them on the road and supporting them at the very highest levels. We are clearly seeing the benefits and the power and potential of the various investments we have been making to the model,” said Jeff Williams, President and CEO. “It has been a very difficult year with the pandemic and social unrest in our country, but our team has stayed focused on taking care of each other and our customers and we have become stronger as a result of these challenges.”

“The investments we are making are foundational and will continue to allow us to increase productivity and leverage our cost structure while significantly improving the customer experience. We continue to prioritize investments in the areas of associate recruiting, training and retention, inventory procurement and management, and customer experience,” added Mr. Williams. “Investments in information technology via our Microsoft Dynamics 365 effort are critically important and key to our future. We are also excited about our customer facing digital opportunities and the advantages these efforts will give us in our local markets. We will continue to look for opportunities to move certain functions from the field to the corporate office to allow our field personnel to focus on growing market share and serving more customers. We are making good progress in all of these areas, and we have a collective sense of urgency to move forward quickly.”

“It was good to see record sales volume productivity of 36.5 sales per lot per month for the quarter. We are transitioning from a collections company to a sales company that is very good at collections. We are completing the rollout of our new service contracts and the reaction from our customers has been very positive. As we have previously stated, we believe that most of our existing dealerships could support 1,000 or more customers over time and that we have significant long-term growth potential from this existing dealership base. In addition, we will continue to open new locations and look for acquisition opportunities into the future,” added Mr. Williams. “Our associates have done outstanding work in very difficult and uncertain times and have demonstrated how nimble our business can be. We have over 2,000 associates supporting over 88,000 customers, and they come to work every day to make a difference in the lives of others.”  

“Revenue increases were driven by a 15.9% increase in the average retail sales price and a 24.3% increase in units sold. We were pleased to see our productivity, the average retail units sold per store per month, improve by 20.9% for the quarter. This is a result of the investments made in inventory, our new service contract offerings, and the hard work of our associates, supplemented by the stimulus payments,” said Vickie Judy, Chief Financial Officer. “Net charge-offs for the quarter, as a percentage of average finance receivables, were down to 4.8% compared to 5.6% in the prior year quarter. As a result of the improved credit losses as well as our outlook for projected losses, we lowered our allowance for credit losses from 26.5% to 24.5% as a percentage of finance receivables, net of deferred revenue. This decrease in the allowance resulted in a $15.1 million pretax decrease in the provision for credit losses. Our selling, general and administrative expenses increased $5.7 million compared to the fourth quarter of fiscal 2020, with continued investment in our associates and the infrastructure to support a growing customer count. We experienced some positive leveraging with the increased sales volumes with selling, general and administrative expenses decreasing to 14.5% of sales compared to 17.7% in the prior year quarter.”

“Our debt, net of cash, to finance receivables is 27.6%, compared to 25.1% at the end of the fourth quarter of fiscal 2020. During the fiscal year, we added $188.4 million in receivables, increased inventory by $45.8 million, repurchased $10.6 million of our common stock, and funded $9.0 million in capital expenditures, a total of $253.8 million, with only a $67.0 million increase in debt, net of cash. These metrics, a strong balance sheet and strong cash-on-cash returns position us to continue to add customer count and grow dealerships,” added Ms. Judy.

Conference Call

Management will be holding a conference call on Tuesday, May 25, 2021 at 11:00 a.m. Eastern Time to discuss quarterly 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 two hours following the call for thirty days and can be accessed by calling (855) 859-2056 (domestic) or (404) 537-3406 (international), conference call ID #8190324.

About America's Car-Mart

America’s Car-Mart, Inc. operates automotive dealerships in twelve states and is one of the largest publicly held automotive retailers 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 smaller cities throughout the South-Central United States selling quality used vehicles and providing financing for substantially all of its customers. For more information about America’s Car-Mart, including investor presentations, 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 may include, but are not limited to:

  • new dealership openings;        
  • performance of new dealerships;
  • same dealership revenue growth;
  • future revenue growth;
  • receivables growth as related to revenue growth;
  • customer growth;
  • gross profit per retail unit sold;
  • interest rates;
  • future credit losses;
  • the Company’s collection results, including but not limited to collections during income tax refund periods;
  • seasonality;
  • technological investments and initiatives; and
  • the Company’s business, operating 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:

  • 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;
  • business and economic disruptions and uncertainty that may result from any future adverse developments with the COVID-19 pandemic and any efforts to mitigate the financial impact and health risks associated with such developments;
  • the expiration of existing economic stimulus measures or other government assistance programs implemented in response to the COVID-19 pandemic or the adoption of further such stimulus measures or assistance programs;
  • the availability of credit facilities to support the Company’s business;
  • the Company’s ability to underwrite and collect its contracts effectively;
  • competition;
  • dependence on existing management;
  • ability to attract, develop and retain qualified general managers;
  • availability of quality vehicles at prices that will be affordable to customers;
  • changes in consumer finance laws or regulations, including but not limited to rules and regulations that have recently been enacted or could be enacted by federal and state governments;
  • ability to keep pace with technological advances and changes in consumer behavior affecting our business;                
  • security breaches, cyber-attacks, or fraudulent activity; and
  • the ability to successfully identify, complete and integrate new acquisitions.

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.

____________________________
Contacts:  Jeffrey A. Williams, President and CEO (479) 464-9944 or Vickie D. Judy, CFO (479) 464-9944



          % Change    As a % of Sales
      Three Months Ended 2021 Three Months Ended
      April 30, vs. April 30,
       2021   2020  2020 2021 2020
Operating Data:               
 Retail units sold  16,555   13,314  24.3 %        
 Average number of stores in operation  151   147  2.7          
 Average retail units sold per store per month  36.5   30.2  20.9          
 Average retail sales price $14,387  $12,408  15.9          
 Gross profit per retail unit $6,032  $5,232  15.3          
 Same store revenue growth  37.6%  8.6%           
 Net charge-offs as a percent of average finance receivables 4.8%  5.6%           
 Collections as a percent of average finance receivables 14.9%  15.0%           
 Average percentage of finance receivables-current (excl. 1-2 day) 85.3%  79.6%           
 Average down-payment percentage  8.7%  7.8%           
                    
Period End Data:               
 Stores open  151   148  2.0 %        
 Accounts over 30 days past due  2.6%  6.2%           
 Active customer count  88,092   80,669  9.2 %        
 Finance receivables, gross $809,538  $621,182  30.3 %        
                    
Operating Statement:               
 Revenues:               
  Sales $248,625  $171,922  44.6 % 100.0 % 100.0 %
  Interest income  30,454   23,767  28.1   12.2   13.8  
    Total  279,079   195,689  42.6   112.2   113.8  
                    
 Costs and expenses:               
  Cost of sales  148,773   102,260  45.5   59.8   59.5  
  Selling, general and administrative  36,139   30,464  18.6   14.5   17.7  
  Provision for credit losses  36,077   49,361  (26.9)  14.5   28.7  
  Interest expense  1,738   1,943  (10.6)  0.7   1.1  
  Depreciation and amortization  947   926  2.3   0.4   0.5  
  Gain on disposal of property and equipment  2   (153) (101.3)  -   -  
    Total  223,676   184,801  21.0   90.0   107.5  
                    
    Income before taxes  55,403   10,888     22.3   6.3  
                    
 Provision for income taxes  11,906   1,629     4.8   0.9  
                    
    Net income $43,497  $9,259     17.5   5.4  
                    
 Dividends on subsidiary preferred stock $(10) $(10)           
                    
    Net income attributable to common shareholders$43,487  $9,249            
                    
Earnings per share:               
 Basic  $6.57  $1.40            
 Diluted $6.19  $1.35            
                    
                    
Weighted average number of shares used in calculation:              
 Basic   6,620,372   6,616,305            
 Diluted  7,028,537   6,872,769            



          % Change As a % of Sales
      Years Ended 2021 Years Ended
      April 30, vs. April 30,
       2021   2020  2020 2021 2020
Operating Data:               
 Retail units sold  56,806   52,914  7.4 %        
 Average number of stores in operation  150   146  2.7          
 Average retail units sold per store per month  31.6   30.2  4.6          
 Average retail sales price $13,621  $11,793  15.5          
 Gross profit per retail unit $5,790  $4,999  15.8          
 Same store revenue growth  18.7%  9.3%           
 Net charge-offs as a percent of average finance receivables 19.3%  23.1%           
 Collections as a percent of average finance receivables 53.2%  55.1%           
 Average percentage of finance receivables-current (excl. 1-2 day) 84.8%  82.2%           
 Average down-payment percentage  7.1%  6.4%           
                    
Period End Data:               
 Stores open  151   148  2.0 %        
 Accounts over 30 days past due  2.6%  6.2%           
 Active customer count  88,092   80,669  9.2 %        
 Finance receivables, gross $809,538  $621,182  30.3 %        
                    
Operating Statement:               
 Revenues:               
  Sales $808,065  $652,992  23.7 % 100.0 % 100.0 %
  Interest income  110,545   91,619  20.7   13.7   14.0  
    Total  918,610   744,611  23.4   113.7   114.0  
                    
 Costs and expenses:               
  Cost of sales  479,153   388,475  23.3   59.3   59.5  
  Selling, general and administrative  130,855   117,762  11.1   16.2   18.0  
  Provision for credit losses  163,662   162,246  0.9   20.3   24.8  
  Interest expense  6,820   8,052  (15.3)  0.8   1.2  
  Depreciation and amortization  3,719   3,839  (3.1)  0.5   0.6  
  Gain on disposal of property and equipment  (40)  (114) (64.9)  -   -  
    Total  784,169   680,260  15.3   97.0   104.2  
                    
    Income before taxes  134,441   64,351     16.6   9.9  
                    
 Provision for income taxes  30,302   13,008     3.7   2.0  
                    
    Net income $104,139  $51,343     12.9   7.9  
                    
 Dividends on subsidiary preferred stock $(40) $(40)           
                    
    Net income attributable to common shareholders$104,099  $51,303            
                    
Earnings per share:               
 Basic  $15.70  $7.74            
 Diluted $14.95  $7.39            
                    
                    
Weighted average number of shares used in calculation:              
 Basic   6,628,749   6,630,023            
 Diluted  6,961,575   6,945,652            
                    



    April 30, April 30, April 30,  
     2021   2020   2019   
           
Cash and cash equivalents $2,893  $59,560  $1,752   
Finance receivables, net $625,119  $466,141  $415,486   
Inventory $82,263  $36,414  $37,483   
Total assets $822,159  $667,324  $492,542   
Total debt $225,924  $215,568  $152,918   
Treasury stock $257,527  $246,911  $230,902   
Total equity $406,496  $302,759  $260,510   
Shares outstanding  6,625,885   6,619,319   6,699,421   
           
           
           
Finance receivables:        
 Principal balance $809,537  $621,182  $543,328   
 Deferred revenue - payment protection plan (32,704)  (24,480)  (21,367)  
 Deferred revenue - service contract (24,106)  (11,641)  (10,592)  
 Allowance for credit losses (184,418)  (155,041)  (127,842)  
           
 Finance receivables, net of allowance and deferred revenue$568,309  $430,020  $383,527   
           
           
 Allowance as % of principal balance net of deferred revenue 24.5%  26.5%  25.0%  
           
           
           
Changes in allowance for credit losses:       
    Three Months EndedYears Ended
    April 30,April 30,
     2021   2020   2021   2020 
 Balance at beginning of period$185,580  $140,282  $155,041  $127,842 
 Provision for credit losses 36,077   49,361   163,662   162,246 
 Charge-offs, net of collateral recovered (37,239)  (34,602)  (134,285)  (135,047)
  Balance at end of period$184,418  $155,041  $184,418  $155,041