Consumer Portfolio Services Inc. Reports Second Quarter 2002 Earnings; Continued Growth in Revenues and Net Income
IRVINE, Calif.--Aug. 6, 2002--Consumer Portfolio Services Inc. today announced earnings for its second quarter, ended June 30, 2002.For the three months ended June 30, 2002 total revenues increased approximately $10.9 million, or 67%, to $27.2 million, compared with $16.3 million for the three months ended June 30, 2001. Operating income for the second quarter 2002 was $1.3 million, an increase of 431% over the $241,000 for the same period last year.
Net income for the quarter ended June 30, 2002 was $739,000, or $0.04 per diluted share, compared with net income of $241,000, or $0.01 per diluted share, for the quarter ended June 30, 2001, representing an increase of more than 200%. Diluted shares outstanding were 21.1 million and 21.2 million for the quarters ended June 30, 2002 and 2001, respectively.
Revenues for the six months ended June 30, 2002 totaled $40.4 million, an increase of $6.8 million, or 20%, compared with $33.6 million in the 2001 period. For the six months ended June 30, 2002 net income was $17.2 million, or $0.79 per diluted share, which includes an extraordinary gain recognized in the first quarter 2002 related to the CPS acquisition of MFN Financial Corp., which closed March 8, 2002.
For the six months ended June 30, 2001 net income was $427,000, or $0.02 per diluted share. Diluted shares outstanding were 22 million and 21.3 million for the six-month periods ended June 30, 2002 and 2001, respectively.
"Consumer Portfolio Services continues to take significant steps toward re-establishing itself as a leader in our industry. Our acquisition of MFN Financial Corp. has progressed according to plan. We are rapidly moving toward the creation of a single, seamless organization and are extremely pleased with the success we have had in consolidating our operations to a single servicing platform in such a short time frame.
"We are excited about the future, and look forward to seizing the enormous opportunities in our market," said Charles E. Bradley, president and chief executive officer of Consumer Portfolio Services.
CPS' managed receivables totaled $570.7 million at June 30, 2002, an increase of 61% since June 30, 2001.
Conference Call
Consumer Portfolio Services also announced that it will hold a conference call on Tuesday, Aug. 6, 2002, at 11 a.m. Pacific Time (2 p.m. Eastern Time), to discuss its quarterly results. Those wishing to participate by telephone may dial-in at 888/858-4066 approximately 10 minutes prior to the scheduled time. A replay will be available between Aug. 6, 2002 and Aug. 13, 2002, beginning one hour after conclusion of the call by dialing 877/519-4471. The reservation number is 3426114.
About Consumer Portfolio Services Inc.
Consumer Portfolio Services is a consumer finance company that specializes in purchasing, selling and servicing retail automobile installment sale contracts originated by automobile dealers located throughout the United States. The company is currently active in 39 states.
Through its purchase of contracts, the company provides indirect financing to car dealer customers with limited credit histories, low incomes or past credit problems, who generally would not be expected to qualify for financing provided by banks or by automobile manufacturers' captive finance companies.
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.
Consumer Portfolio Services, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three months ended Six months ended
June 30, June 30,
2002 2001 2002 2001
Revenues:
Gain on sale of contracts,
net $ 5,095 $ 9,121 $ 6,867 $ 18,492
Interest income 14,746 4,299 22,490 9,314
Servicing fees 3,376 2,628 6,766 5,207
Other income 3,999 272 4,229 632
27,216 16,320 40,352 33,645
Expenses:
Employee costs 10,972 5,918 19,434 12,870
General and
administrative 5,121 3,799 9,525 6,666
Interest 7,217 3,489 11,648 7,758
Other expenses 2,627 2,873 5,241 5,804
25,937 16,079 45,848 33,098
Income (loss) before income tax expense (benefit)
and extraordinary
item 1,279 241 (5,496) 547
Income tax expense
(benefit) 540 - (5,254) 120
Income (loss) before extraordinary
item 739 241 (242) 427
Extraordinary item, unallocated negative
goodwill - - 17,412 -
Net income $ 739 $ 241 $ 17,170 $ 427
Earnings (loss) per share before extraordinary item:
Basic $ 0.04 $ 0.01 $ (0.01) $ 0.02
Diluted 0.04 0.01 (0.01) 0.02
Earnings per share after extraordinary item:
Basic $ 0.04 $ 0.01 $ 0.88 $ 0.02
Diluted 0.04 0.01 0.79 0.02
Number of shares used in computing earnings (loss) per share:
Basic 19,418 19,540 19,405 19,558
Diluted 21,064 21,222 21,989 21,297
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
June 30, Dec. 31,
2002 2001
Cash and restricted cash $ 41,841 $ 13,924
Finance receivables, net 138,953 -
Residual interest in
securitizations 124,106 106,103
Other assets 30,336 31,177
$ 335,236 $ 151,204
Accounts payable and other
liabilities $ 18,851 $ 9,029
Securitization trust debt 115,767 -
Senior secured debt 65,256 26,000
Subordinated debt 54,324 54,489
254,198 89,518
Shareholders' equity 81,038 61,686
$ 335,236 $ 151,204