AmeriCredit Corp. Reports 66% Increase in Third Quarter Earnings
14 April 2000
AmeriCredit Corp. Reports 66% Increase in Third Quarter Earnings On Record Loan Volume of $1.2 Billion
FORT WORTH, Texas--April 13, 2000--AmeriCredit Corp. (NYSE:ACF) today announced record net income of $32,410,000, or $0.41 per share, for its third fiscal quarter ended March 31, 2000, versus earnings of $19,505,000, or $0.29 per share, for the quarter ended March 31, 1999. On a comparative basis, net income increased 66% and earnings per share rose 41%.For the nine months ended March 31, 2000, AmeriCredit reported net income of $77,343,000, or $1.01 per share, including a charge for the closing of AmeriCredit's mortgage business in the second quarter. Excluding this charge, earnings for the nine months ended March 31, 2000 were $86,328,000, or $1.13 per share, versus earnings of $52,363,000, or $0.78 per share, for the nine months ended March 31, 1999. On a comparative basis, excluding the charge, this represents an increase of 65% in earnings and 45% in earnings per share.
Automobile loan purchases were a record $1,155,116,000 for the third quarter of fiscal 2000, an increase of 51% over loan purchases of $766,778,000 for the third quarter of fiscal 1999. AmeriCredit's managed auto receivables totaled $5,949,918,000 at March 31, 2000, an increase of 67% since March 31, 1999. The Company had 186 branch locations in 41 states and Canada at March 31, 2000.
Annualized net charge-offs decreased to 3.9% of average managed auto receivables for the third quarter ended March 31, 2000, down from 4.7% for the third quarter of fiscal 1999. This marks the Company's 16th consecutive quarter of stable or declining charge-off levels.
Managed auto receivables more than sixty days delinquent were 2.1% of total managed auto receivables at March 31, 2000, compared to 2.3% at March 31, 1999.
Clifton H. Morris, Jr., Chairman and Chief Executive Officer of AmeriCredit, stated, "We are extremely pleased that we achieved record loan origination volume while implementing increases in loan pricing during the quarter. Our increased return on managed assets during the quarter confirms our ability to sustain our margins during periods of rising interest rates." AmeriCredit's average interest rate on loans originated in the third quarter increased by approximately 70 basis points over the preceding quarterly period ended Dec. 31, 1999, more than offsetting higher funding costs.
AmeriCredit is one of the nation's largest middle market finance companies specializing in purchasing, securitizing and servicing automobile loans. AmeriCredit maintains a Web site at www.americredit.com that contains further information on the Company.
AmeriCredit will host a conference call for analysts and investors at 9:00 A.M. Eastern Time on Friday, April 14, 2000. For an Internet broadcast of this conference call, please go to the Company's Web site to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call.
Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements that involve risks and uncertainties detailed from time to time in the Company's filings and reports with the Securities and Exchange Commission. Such statements are based on the beliefs of the Company's management as well as assumptions made by and information currently available to Company management. Actual events or results may differ materially.
AmeriCredit Corp.
Consolidated Income Statements
(Unaudited, Dollars in Thousands, Except Per Share Amounts)
Three Months Ended Nine Months Ended
March 31, March 31,
----------------------- ----------------------
2000 1999 2000 1999
------------ ---------- ----------- ----------
Revenue:
Finance charge income $ 30,512 $ 18,361 $ 85,506 $ 51,538
Gain on sale of
receivables 52,923 42,531 151,165 116,551
Servicing fee income 44,645 23,691 120,528 61,702
Other income 1,953 484 4,697 3,361
----------- ---------- ----------- ----------
130,033 85,067 361,896 233,152
----------- ---------- ----------- ----------
Costs and expenses:
Operating expenses 55,488 42,025 162,031 115,760
Provision for losses 3,986 2,286 11,229 6,589
Interest expense 17,858 9,041 48,263 25,660
Charge for closing 10,500
mortgage business ----------- ---------- ----------- ----------
77,332 53,352 232,023 148,009
----------- ---------- ----------- ----------
Income before
income taxes 52,701 31,715 129,873 85,143
Income tax provision 20,291 12,210 52,530 32,780
----------- ---------- ----------- ----------
Net income $32,410 $ 19,505 $ 77,343 $ 52,363
=========== ========== =========== ==========
Earnings per share:
Basic $ 0.43 $ 0.31 $ 1.07 $ 0.83
=========== ========== =========== ==========
Diluted $ 0.41 $ 0.29 $ 1.01 $ 0.78
=========== ========== =========== ==========
Weighted average shares 74,869,550 63,187,789 72,110,495 62,872,858
=========== ========== =========== ==========
Weighted average shares
and assumed incremental
shares 79,027,907 66,514,367 76,544,943 66,822,426
=========== ========== =========== ==========
Condensed Consolidated Balance Sheets
(Unaudited, Dollars in Thousands)
March 31, December 31, June 30,
2000 1999 1999
------------ ----------- -----------
Cash and cash equivalents $ 50,818 $ 176,672 $ 21,189
Finance receivables, net 688,021 559,929 456,009
Interest-only receivables
from Trusts 223,411 230,366 191,865
Investments in Trust receivables 300,169 270,827 195,598
Restricted cash 215,533 183,868 107,399
Other assets 107,345 108,658 91,427
------------ ----------- -----------
Total assets $ 1,585,297 $ 1,530,320 $ 1,063,487
============ =========== ===========
Borrowings under warehouse lines $ 324,647 $ 356,217 $ 114,659
Senior notes 375,000 375,000 375,000
Other notes payable 66,398 58,092 17,874
Other liabilities 198,567 155,219 156,224
------------ ----------- -----------
Total liabilities 964,612 944,528 663,757
Shareholders' equity 620,685 585,792 399,730
------------ ----------- -----------
Total liabilities and
shareholders' equity $ 1,585,297 $ 1,530,320 $ 1,063,487
============ =========== ===========
Cash Flows From Operating Activities:
(Unaudited, Dollars in Thousands)
Three Months Ended Nine Months Ended
March 31, March 31,
------------------ ------------------
2000 1999 2000 1999
-------- -------- -------- --------
Cash revenue
Finance charge income $ 30,512 $ 18,361 $ 85,506 $ 51,538
Cash gain on sale 6,840 5,292 12,412 8,909
Servicing fee income 33,422 19,495 89,140 50,963
Other income 1,953 484 4,697 3,361
Securitization distributions 42,732 10,261 79,443 35,182
Changes in working capital 6,968 (85) 8,322 15,539
-------- -------- -------- --------
122,427 53,808 279,520 165,492
-------- -------- -------- --------
Cash expenses
Operating expenses (51,318) (39,257) (148,504) (108,858)
Interest expense (17,858) (9,041) (48,263) (25,660)
Income taxes (18,121) (10) (42,946) (10)
Charge for closing mortgage -- -- (3,934) --
business -------- -------- -------- --------
(87,297) (48,308) (243,647) (134,528)
-------- -------- -------- --------
Operating cash flow 35,130 5,500 35,873 30,964
Undistributed securitization
cash flow 17,184 1,888 77,092 29,007
Restricted cash deposits (30,750) (21,000) (87,750) (57,250)
Return of restricted cash
deposits -- 23,000 -- 23,000
-------- -------- -------- --------
Net cash flow $ 21,564 $ 9,388 $ 25,215 $ 25,721
======== ======== ======== ========
Total Cash Flow Generated
by Trusts:
Undistributed $ 17,184 $ 1,888 $ 77,092 $ 29,007
Return of restricted cash
deposits -- 23,000 -- 23,000
Distributed 42,732 10,261 79,443 35,182
-------- -------- -------- --------
Total $ 59,916 $ 35,149 $ 156,535 $ 87,189
======== ======== ======== ========
Other Financial Data
(Unaudited, Dollars in Thousands)
Three Months Ended Nine Months Ended
March 31, March 31,
------------------ ------------------
2000 1999 2000 1999
----------- ----------- ----------- ----------
Auto lending operations
Auto loan originations $ 1,155,116 $ 766,778 $ 3,167,835 $ 1,990,894
Auto loans sold 1,025,000 700,000 2,925,000 1,920,001
Gain on sale of auto
loans 52,923 40,514 149,654 111,452
Gain on sale of auto
loans 5.2% 5.8% 5.1% 5.8%
(% of loans sold)
Average owned
receivables $ 533,259 $ 308,375 $ 496,599 $ 292,629
Average serviced
receivables 5,060,612 2,970,569 4,514,551 2,600,123
----------- ----------- ----------- ----------
Average managed
receivables $ 5,593,871 $3,278,944 $ 5,011,150 $ 2,892,752
----------- ----------- ----------- ----------
March 31, 2000
----------------
Auto loan portfolio Owned Serviced Total Managed
----- -------- -------------
Principal $ 699,450 $ 5,250,468 $ 5,949,918
Allowance for losses (20,488) (507,574) (528,062)
---------- ------------ -------------
$ 678,962 $ 4,742,894 $ 5,421,856
========== ============ =============
Allowance for losses (%) 2.9% 9.7% 8.9%
========== ============ =============
March 31, December 31, March 31,
2000 1999 1999
-------------- --------------- -------------
Auto loan delinquency (%)
31 - 60 days 6.0% 7.6% 6.2%
> 60 days 2.1% 2.5% 2.3%
-------------- --------------- -------------
8.1% 10.1% 8.5%
Repossessions 0.8% 0.9% 0.9%
-------------- --------------- -------------
8.9% 11.0% 9.4%
============== =============== =============
Pro Forma "Portfolio-Based" Earnings Data(1)
(Unaudited, Dollars in Thousands)
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------- ---------------------
2000 1999 2000(2) 1999
-------- ------- -------- --------
Finance charge, fee and
other income $ 272,093 $ 160,312 $ 737,163 $ 431,346
Funding costs (107,991) (55,281) (282,742) (151,936)
--------- --------- --------- ---------
Net margin 164,102 105,031 454,421 279,410
Operating expenses (55,488) (42,025) (162,031) (115,760)
Credit losses (53,997) (38,118) (154,904) (103,891)
--------- --------- --------- ---------
Pre-tax "portfolio-based"
income 54,617 24,888 137,486 59,759
Income taxes (21,028) (9,582) (52,933) (23,007)
--------- --------- --------- ---------
Net "portfolio-based"
income $ 33,589 $ 15,306 $ 84,553 $ 36,752
========= ========= ========= =========
Diluted "portfolio-based"
earnings per share $ 0.43 $ 0.23 $ 1.10 $ 0.55
========= ========= ========= =========
Pro Forma Return on Managed Assets(1)
(Auto Business, Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------- ---------------------
2000 1999 2000 1999
-------- ------- -------- --------
Finance charge, fee and
other income 19.6% 19.5% 19.5% 19.5%
Funding costs (7.8) (6.8) (7.5) (6.9)
--------- --------- --------- ---------
Net margin 11.8 12.7 12.0 12.6
Credit losses (3.9) (4.7) (4.1) (4.8)
--------- --------- --------- ---------
Risk adjusted margin 7.9 8.0 7.9 7.8
Operating expenses (4.0) (4.9) (4.2) (5.0)
--------- --------- --------- ---------
Pre-tax return on managed
assets 3.9 3.1 3.7 2.8
Income taxes (1.5) (1.2) (1.4) (1.1)
--------- --------- --------- ---------
Return on managed assets 2.4% 1.9% 2.3% 1.7%
========= ========= ========= =========
(1) The pro forma "portfolio-based" earnings data and return on
managed assets present the Company's operating results under the
assumption that securitization transactions are financings and no
gain on sale or servicing fee income is recognized. Instead,
finance charge income and fees as well as interest and other costs
are recognized over the life of the securitized receivables as
accrued. Credit losses are recorded as incurred. While this data
does not purport to present the Company's operating results in
accordance with generally accepted accounting principles, the
Company believes such presentation provides another measure for
assessing the Company's performance.
(2) The pro forma "portfolio-based" earnings data for the nine-month
period ended March 31, 2000 excludes the charge for the closing of
AmeriCredit's mortgage business.