Consumer Portfolio Services Inc. Reports Third Quarter Net Earnings
IRVINE, Calif.--Oct. 29, 2001--Consumer Portfolio Services Inc. , today announced net earnings for its third quarter ended Sept. 30, 2001.Net earnings for the quarter ended Sept. 30, 2001 were $253,000, or $0.01 per diluted share, compared with a net loss of $1.2 million, or ($0.06) per diluted share, for the quarter ended Sept. 30, 2000. Diluted shares outstanding were 21.1 million and 20.3 million for the quarters ending Sept. 30, 2001 and 2000, respectively.
Quarter over quarter revenues for the three months ended Sept. 30, 2001 and 2000 were unchanged at approximately $14.3 million for each of the periods.
For the nine months ended Sept. 30, 2001, net earnings were $680,000, or $0.03 per diluted share, compared with a net loss of $15.5 million, or ($0.76) per diluted share, for the year earlier period.
Diluted shares outstanding were 21.2 million and 20.3 million for the nine-month periods ending Sept. 30, 2001 and 2000, respectively. Revenues for the nine months ended Sept. 30, 2001 totaled $47.9 million, compared with revenues of $28.2 million for the period ending Sept. 30, 2000.
Purchases of contracts from automobile dealers during the quarter ended Sept. 30, 2001 increased by $2.0 million, or 1.3%, to $158.4 million from $156.4 million for the third quarter of 2000. During the three-month period ended Sept. 30, 2001, the company sold $158.1 million of contracts, compared with $156.4 million for the same period in the prior year, an increase of 1.1%.
Additionally, on Sept. 7, 2001 the company completed the CPS Auto Receivables Trust 2001-A Securitization, thereby issuing Class A-1 and Class A-2 Notes aggregating $68.5 million. This transaction represents the first term securitization completed by Consumer Portfolio Services since the fourth quarter of 1998.
The aggregate outstanding balance of contracts serviced by the company at Sept. 30, 2001 was $318.1 million, compared with $490.0 million at Sept. 30, 2000.
Balances of accounts past due over 30 days represented 5.0% of the servicing portfolio at Sept. 30, 2001, compared with 5.1% at Sept. 30, 2000. The annualized net charge-off rate for the three-month period ended Sept. 30, 2001 was 6.0%, compared with 9.7% for the three-month period ended Sept. 30, 2000, a decrease of 38.1%. The inventory of repossessed vehicles was 1.7% of the servicing portfolio as of Sept. 30, 2001, compared with 2.0% at Sept. 30, 2000.
"We continue to achieve the goals that we set forth at the beginning of 2001. Our first task was to achieve profitability, which we have now done for three consecutive quarters.
"Our second was to complete a term securitization representing the return of CPS to the securitization market, which was accomplished in the third quarter. These achievements are significant steps in returning CPS to a prominent position in our industry," said Charles E. Bradley, president and chief executive officer of Consumer Portfolio Services.
Consumer Portfolio Services purchases, sells and services retail installment sales contracts originated predominantly by franchised dealers for new and late model used cars. The company finances automobile purchases through more than 4,000 dealers under contract throughout the United States.
Forward-looking statements in this news release include the company's recorded gain on sale and provision for credit losses because these items are dependent on the company's estimates of future losses. The accuracy of such estimates may be adversely affected by various factors, which include (in addition to risks relating to the economy generally) the following: possible increased delinquencies, repossessions and losses on retail installment contracts; incorrect prepayment speed and/or discount rate assumptions, possible unavailability of qualified personnel, which could adversely affect the company's ability to service its portfolio; possible increases in the rate of consumer bankruptcy filings or changes in bankruptcy law, which could adversely affect the company's rights to collect payments from its portfolio; other changes in government regulations affecting consumer credit; possible declines in the market price for used vehicles, which could adversely affect the company's realization upon repossessed vehicles; and economic conditions in geographic areas in which the company's business is concentrated. -0-
Consumer Portfolio Services Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three months ended Nine months ended
Sept. 30, Sept. 30,
2001 2000 2001 2000
Revenues:
Gain on sale of
contracts, net $ 7,441 $ 4,787 $ 25,933 $ 12,628
Interest
income 3,909 5,648 13,222 2,483
Servicing fees 2,676 3,585 7,884 12,969
Other income 245 236 877 100
14,271 14,256 47,916 28,180
Expenses:
Employee costs 5,055 6,339 17,925 18,716
General and
administrative 3,205 2,684 9,871 10,697
Interest 3,258 4,241 11,016 13,011
Other expenses 2,500 2,483 8,304 7,950
14,018 15,747 47,116 50,374
Earnings (loss)
before income
tax expense
(benefit) 253 (1,491) 800 (22,194)
Income tax
expense
(benefit) - (313) 120 (6,733)
Net earnings
(loss) $ 253 $ (1,178) $ 680 $(15,461)
Earnings (loss)
per share:
Basic $ 0.01 $ (0.06) $ 0.03 $ (0.76)
Diluted 0.01 (0.06) 0.03 (0.76)
Number of shares
used in computing
earnings (loss)
per share:
Basic 19,790 20,311 19,567 20,258
Diluted 21,112 20,311 21,163 20,258
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
Sept. 30, Dec. 31,
2001 2000
Cash and restricted cash $ 14,473 $ 24,315
Contracts held for sale 2,612 18,830
Residual interest in securitizations 107,613 99,199
Other assets 28,598 33,350
-------------- --------------
$ 153,296 $ 175,694
Accounts payable and other liabilities $ 10,901 $ 16,373
Senior secured debt 26,000 38,000
Subordinated debt 54,514 59,199
91,415 113,572
Shareholders' equity 61,881 62,122
$ 153,296 $ 175,694