Onyx Acceptance Reports Increase in Earnings
22 October 1999
Onyx Acceptance Reports Increase in Earnings, Revenues and Loan Originations In Third Quarter
FOOTHILL RANCH, Calif., Oct. 22 -- Onyx Acceptance
Corporation announced today financial and operational results
for the quarter and nine-month periods ended September 30, 1999:
For The Third Quarter:
-- Net income rose by 48%, from $1.8 million earned in third quarter
1998, to $2.6 million.
-- Earnings per diluted share climbed 44% to $0.39. This compares with
$0.27 per diluted share for the third quarter 1998.
-- Total revenues increased by 43%, to $23.6 million. This compares to
$16.5 million in the same quarter 1998.
-- Contracts purchased increased by 39%, from $286.5 million originated
in third quarter 1998, to $398.8 million.
-- Operating expenses as a percent of average servicing portfolio
declined to 4.16%. This compares with 4.75% in the same quarter 1998.
-- Contracts securitized during the quarter increased by 60%, from
$250 million in 1998, to $400 million.
-- Off balance sheet reserves as a percent of securitized assets
increased to 4.45% at September 30, 1999, up from 4.31% at
December 31, 1998.
For The Nine-Month Period:
-- Net income increased 100% to $7.2 million, compared with $3.6 million
earned for the same period last year.
-- Earnings per diluted share for the period climbed 96% to $1.10,
compared with $0.56 for the same period in 1998.
-- Total revenues for the nine-month period increased 57% to
$65.9 million, compared to $42 million for the same period in 1998.
-- Contract purchases increased by 54% to $1.1 billion, compared to
$734.3 million in 1998.
-- Operating expenses as a percent of average servicing portfolio
declined to 4.31%. This compares with 4.88% for the nine months ended
September 30, 1998.
-- Servicing portfolio increased by 64% to $1.9 billion at quarter-end
from $1.2 billion at September 30, 1998.
ONYX ACCEPTANCE CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(UNAUDITED)
September 30, December 31,
1999 1998
ASSETS
CASH & CASH EQUIVALENTS $4,787,831 $1,928,991
CONTRACTS HELD FOR SALE
- Net of Allowance (a) 195,535,962 152,760,781
CREDIT ENHANCEMENT ASSETS 130,900,443 112,953,193
OTHER ASSETS 11,070,086 7,778,759
TOTAL ASSETS $342,294,322 $275,421,724
LIABILITIES AND EQUITY
LIABILITIES
DEBT $255,071,383 $209,600,061
OTHER LIABILITIES 36,514,796 21,997,942
TOTAL LIABILITIES 291,586,179 231,598,003
TOTAL EQUITY 50,708,143 43,823,721
TOTAL LIABILITIES AND EQUITY $342,294,322 $275,421,724
(a) Net of Unearned Discounts
ONYX ACCEPTANCE CORPORATION and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
REVENUES:
Net Interest Income 1,665,793 2,787,072 5,588,923 6,051,445
Gain on Sale
of Contracts 13,723,258 9,676,893 40,520,626 25,911,096
Service Fee Income 8,237,101 4,007,969 19,757,636 10,015,975
Total Revenues 23,626,152 16,471,934 65,867,185 41,978,516
EXPENSES:
Provision for
Credit Losses 203,579 597,957 952,560 1,229,764
Operating Expenses 18,994,516 12,878,210 52,672,183 34,612,101
Total Expenses 19,198,095 13,476,167 53,624,743 35,841,865
NET INCOME BEFORE
INCOME TAXES 4,428,057 2,995,767 12,242,442 6,136,651
INCOME TAXES 1,837,644 1,243,243 5,080,613 2,546,709
NET INCOME $2,590,413 $1,752,524 $7,161,829 $3,589,942
NET INCOME PER SHARE
- BASIC $0.42 $0.28 $1.16 $0.59
NET INCOME PER SHARE
- DILUTED $0.39 $0.27 $1.10 $0.56
BASIC SHARES
OUTSTANDING 6,175,817 6,162,374 6,172,628 6,093,198
DILUTED SHARES
OUTSTANDING 6,656,463 6,381,882 6,527,643 6,445,412
ONYX ACCEPTANCE CORPORATION and SUBSIDIARIES
DELINQUENCY AND LOSS RATES
(UNAUDITED)
(In Thousands)
September 30, December 31,
1999 1998
Delinquency Experience
Number of Number of
Contracts $ Contracts $
Servicing Portfolio 189,062 $1,924,881 131,862 $1,345,961
Serviced Delinquency
31 to 59 days 3,067 $29,324 2,766 $26,410
60 to 89 days 1,141 11,219 691 6,876
90 days or more 1,068 10,992 455 4,790
Total 5,276 $51,535 3,912 $38,076
Delinquency as a
percent of number
and amount of contracts 2.79% 2.68% 2.97% 2.83%
Three Months Ended Nine Months Ended
September 30, September 30,
Loss Experience
1999 1998 1999 1998
Average Contracts
Serviced during
the period $1,824,799 $1,083,919 $1,629,779 $945,077
Gross Charge-offs $9,426 $5,453 $24,528 $14,827
Recoveries $1,228 $794 $3,155 $2,251
Net Charge-offs $8,198 $4,659 $21,373 $12,576
Net Charge-offs as a
percent of contracts
outstanding during
the period 1.80% 1.72% 1.75% 1.77%
Onyx Acceptance Corporation
Static Pool Information for securitized pools outstanding
for the period from the date of securitization through September 30, 1999
Trust: 96-1 96-2 96-3 96-4 97-1 97-2 97-3 97-4
Month
1 0.00% 0.01% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
2 0.03% 0.07% 0.02% 0.02% 0.00% 0.00% 0.00% 0.00%
3 0.05% 0.20% 0.07% 0.05% 0.03% 0.02% 0.02% 0.01%
4 0.11% 0.33% 0.16% 0.14% 0.06% 0.07% 0.09% 0.04%
5 0.23% 0.46% 0.43% 0.24% 0.13% 0.22% 0.13% 0.11%
6 0.40% 0.78% 0.54% 0.38% 0.26% 0.32% 0.24% 0.20%
7 0.69% 0.98% 0.74% 0.53% 0.37% 0.59% 0.36% 0.28%
8 0.82% 1.15% 0.97% 0.81% 0.52% 0.80% 0.47% 0.43%
9 0.93% 1.39% 1.13% 0.98% 0.60% 0.91% 0.62% 0.55%
10 1.15% 1.52% 1.32% 1.18% 0.76% 1.07% 0.73% 0.72%
11 1.25% 1.69% 1.47% 1.43% 0.92% 1.26% 0.81% 0.87%
12 1.47% 1.94% 1.60% 1.63% 1.02% 1.42% 0.94% 0.95%
13 1.65% 2.08% 1.77% 1.73% 1.13% 1.58% 1.10% 1.08%
14 1.79% 2.34% 1.94% 1.87% 1.23% 1.68% 1.23% 1.19%
15 2.02% 2.52% 2.09% 2.07% 1.40% 1.80% 1.38% 1.36%
16 2.25% 2.76% 2.27% 2.23% 1.56% 1.97% 1.58% 1.42%
17 2.43% 2.89% 2.42% 2.33% 1.68% 2.10% 1.68% 1.52%
18 2.59% 3.10% 2.57% 2.49% 1.75% 2.23% 1.77% 1.64%
19 2.77% 3.14% 2.70% 2.62% 1.85% 2.35% 1.91% 1.75%
20 2.93% 3.30% 2.83% 2.73% 1.92% 2.48% 2.04% 1.85%
21 3.06% 3.47% 2.94% 2.84% 1.98% 2.59% 2.11% 1.97%
22 3.15% 3.60% 3.00% 2.93% 2.09% 2.72% 2.20% 2.08%
23 3.21% 3.70% 3.08% 3.02% 2.17% 2.81% 2.31%
24 3.28% 3.81% 3.17% 3.10% 2.22% 2.85% 2.41%
25 3.40% 3.93% 3.28% 3.22% 2.31% 2.93% 2.51%
26 3.43% 4.06% 3.38% 3.29% 2.38% 2.96%
27 3.55% 4.13% 3.43% 3.39% 2.44% 3.09%
28 3.60% 4.22% 3.54% 3.46% 2.50% 3.17%
29 3.73% 4.23% 3.59% 3.58% 2.55%
30 3.75% 4.29% 3.69% 3.61% 2.63%
31 3.79% 4.31% 3.77% 3.64% 2.67%
32 3.85% 4.33% 3.75% 3.72%
33 3.88% 4.37% 3.77% 3.74%
34 3.90% 4.39% 3.79% 3.77%
35 3.94% 4.39% 3.81%
36 3.94% 4.42% 3.83%
37 3.94% 4.42% 3.84%
38 3.97% 4.43%
39 3.99% 4.45%
40 3.96% 4.46%
41 3.96% 4.45%
42 3.95%
43 3.96%
44 3.94%
45 3.97%
Onyx Acceptance Corporation
Static Pool Information for securitized pools outstanding
for the period from the date of securitization through September 30, 1999
Trust: 98-1 98-A 98-B 98-C 99-A 99-B 99-C
Month
1 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
2 0.01% 0.01% 0.00% 0.02% 0.00% 0.00% 0.01%
3 0.02% 0.03% 0.02% 0.02% 0.02% 0.03%
4 0.08% 0.07% 0.08% 0.04% 0.05% 0.07%
5 0.14% 0.14% 0.19% 0.15% 0.11% 0.14%
6 0.24% 0.23% 0.33% 0.27% 0.21%
7 0.40% 0.37% 0.45% 0.46% 0.35%
8 0.53% 0.42% 0.61% 0.57% 0.49%
9 0.68% 0.51% 0.82% 0.74%
10 0.85% 0.70% 0.95% 0.94%
11 1.04% 0.85% 1.10% 1.12%
12 1.20% 1.01% 1.20%
13 1.33% 1.17% 1.36%
14 1.46% 1.37%
15 1.61% 1.48%
16 1.71% 1.59%
17 1.88%
18 2.01%
19 2.17%
Financial Results
The Company recorded a gain on sale of contracts of $13.7 million for the
quarter ended September 30, 1999, compared to a gain of $9.7 million for the
same period of 1998. For the nine months ended September 30, 1999, gain on
sales of contracts totaled $40.5 million compared to gain on sales of
$25.9 million for the same period of 1998. The increase in the gain on sales
is primarily the result of an increase in the amount of contracts sold.
Service fee income increased to $8.2 million and $19.8 million for the
three- and nine- month periods ending September 30, 1999, compared to
$4.0 million and $10.0 million for the same periods in 1998. These increases
are due primarily to higher amounts of contractual service fees, late fees and
document fees as a result of the growth in the servicing portfolio.
The increase in revenue was a result of the continued expansion of the
Company's servicing portfolio and the increased volume of contracts purchased
resulting from the continued development of the dealer base in new and
existing markets.
Total operating expenses as a percent of average servicing portfolio
declined to 4.16% for the quarter ended September 30, 1999, compared to 4.75%
for the quarter ended September 30, 1998. The operating expense ratio for the
nine months ended September 30, 1999, was 4.31%, compared to 4.88% for the
nine months ended September 30, 1998.
Portfolio Performance
Annualized net charge-offs as a percent of average servicing portfolio
increased to 1.80% at the end of third quarter 1999, from 1.72% at the end of
third quarter 1998. The annualized net charge-offs as a percent of average
servicing portfolio for the nine months ended September 30, 1999, was 1.75%,
down from 1.77% for the same period in 1998. The amount of total
delinquencies as a percent of the servicing portfolio was 2.68% at September
30, 1999, a 15 basis point improvement from 2.83% at December 31, 1998.
Business Development
Onyx opened its 17th auto finance center, this one in Arlington, Texas.
Chase Securities, Inc. joined the group of lenders providing financing to
Onyx. During the quarter, Chase arranged a $150 million warehouse line. The
transaction increased Onyx's warehousing capacity by 32% to $625 million.
Onyx Acceptance Corporation is a specialized automobile finance company
based in Foothill Ranch, CA. Onyx provides financing to franchised and select
independent dealerships throughout the United States.
This news release contains forward-looking statements that are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those projected. The most significant among these risks and
uncertainties are (a) the Company's level of delinquencies, gross charge-offs
and net losses, (b) the Company's ability to achieve adequate interest rate
spreads, (c) the effects of economic factors on consumer debt, and (d) the
continued availability of liquidity sources. Other important factors are
detailed in the Company's annual report on Form 10-K as amended by Form 10-K/A
for the year ended December 31, 1998, and on Form 10-Q for the quarters ended
March 31, 1999, and June 30, 1999.
For information about Onyx Acceptance Corporation and to view a recent
investor presentation, please visit Onyx's web site at http://www.onyxco.com.