[Fourth Quarter Highlights](index=1&type=section&id=Fourth%20Quarter%20Highlights) The company's fourth quarter saw a focus on credit quality, a slowdown in customer base decline, and improved net income and diluted EPS despite slightly lower revenues [Operational Overview](index=1&type=section&id=Operational%20Overview) World Acceptance Corporation maintained a focus on credit quality and conservative lending, with gross loans outstanding decreasing but the customer base decline slowing significantly - Gross loans outstanding were **$1.28 billion** as of March 31, 2024, an **8.1% decrease** from **$1.39 billion** as of March 31, 2023, with a sequential decrease of **8.8% ($123.5 million)** from December 31, 2023[3](index=3&type=chunk) - The customer base decreased by **1.5%** during the twelve-month period ended March 31, 2024, a significant improvement compared to a **15.9% decrease** in the comparable prior-year period[4](index=4&type=chunk) Volume of Gross Loan Origination Balances (excluding tax advance loans) by Customer Type | Customer Type | Q4 FY 2024 (USD) | Q4 FY 2023 (USD) | | :--- | :--- | :--- | | New Customers | $26,511,522 | $25,669,834 | | Former Customers | $58,583,919 | $62,965,426 | | Refinance Customers | $432,270,234 | $449,571,142 | - The Company operated **1,048 open branches** as of March 31, 2024, with same-store gross loans decreasing **6.7%** for branches open at least twelve months[5](index=5&type=chunk) [Key Financial Metrics (Q4 FY2024)](index=1&type=section&id=Key%20Financial%20Metrics%20(Q4%20FY2024)) The fourth fiscal quarter saw a notable increase in net income and diluted EPS, despite a slight decline in total revenues, with improved credit quality evidenced by reduced delinquency rates - Net income for the fourth fiscal quarter was **$35.1 million**[6](index=6&type=chunk) - Diluted net income per share was **$6.09**[6](index=6&type=chunk) - Recency delinquency on accounts 90+ days past due improved to **3.1%** at March 31, 2024, from **3.5%** at March 31, 2023[6](index=6&type=chunk) - Total revenues were **$159.3 million**, including a **34 basis point yield increase** compared to the same quarter in the prior year[6](index=6&type=chunk) [Detailed Fourth Quarter Financial Results (Three Months Ended March 31, 2024)](index=3&type=section&id=Detailed%20Fourth%20Quarter%20Financial%20Results%20(Three%20Months%20Ended%20March%2031,%202024)) This section provides an in-depth analysis of the company's Q4 FY2024 financial performance, covering income, credit quality, loan portfolio, operating expenses, and capital management [Income and Revenue Analysis](index=3&type=section&id=Income%20and%20Revenue%20Analysis) Net income and diluted EPS significantly increased in Q4 FY2024 compared to the prior year, despite a slight decrease in total revenues, driven by a decline in interest and insurance income partially offset by strong growth in other income Q4 Financial Performance (Three Months Ended March 31) | Metric | Q4 FY 2024 (USD) | Q4 FY 2023 (USD) | Change | | :--- | :--- | :--- | :--- | | Net income | $35.1 million | $24.6 million | +42.7% | | Diluted net income per share | $6.09 | $4.20 | +45.0% | | Total revenues | $159.3 million | $160.8 million | -1.0% | Revenue Breakdown (Q4 FY2024 vs. Q4 FY2023) | Revenue Type | Q4 FY 2024 (USD) | Q4 FY 2023 (USD) | Change | | :--- | :--- | :--- | :--- | | Interest and fee income | $116.3 million | $121.5 million | -4.3% | | Insurance income | $13.2 million | $16.0 million | -17.8% | | Other income | $29.8 million | $23.3 million | +27.7% | - Revenues from the tax return preparation business increased by **$6.2 million**, or **30.5%**, due to a **13.6% increase** in the number of tax returns prepared and an increase in the average preparation fee per return[9](index=9&type=chunk) [Credit Quality and Provision for Credit Losses](index=3&type=section&id=Credit%20Quality%20and%20Provision%20for%20Credit%20Losses) The company experienced significant improvements in credit quality during Q4 FY2024, with a substantial decrease in the provision for credit losses and net charge-offs, alongside lower delinquency rates - The provision for credit losses decreased **$16.1 million** to **$29.3 million** in Q4 FY2024 from **$45.4 million** in Q4 FY2023[10](index=10&type=chunk) - Net charge-offs for the quarter decreased **$17.0 million**, from **$64.4 million** in Q4 FY2023 to **$47.4 million** in Q4 FY2024[12](index=12&type=chunk) - Net charge-offs as a percentage of average net loan receivables on an annualized basis decreased to **18.8%** in Q4 FY2024 from **23.9%** in Q4 FY2023[12](index=12&type=chunk) - Accounts 61 days or more past due decreased to **5.0%** on a recency basis at March 31, 2024, compared to **5.5%** at March 31, 2023, while allowance for credit losses as a percent of net loans receivable was **10.8%** at March 31, 2024, compared to **12.4%** at March 31, 2023[13](index=13&type=chunk) [Loan Portfolio Composition and Management](index=4&type=section&id=Loan%20Portfolio%20Composition%20and%20Management) The company has strategically tightened lending to new customers over the past two years, resulting in a shift in the loan portfolio mix towards customers with more than two years of tenure Gross Loan Balance By Customer Tenure at Origination (As of March 31) | As of | Less Than 2 Years (USD) | More Than 2 Years (USD) | Total (USD) | | :--- | :--- | :--- | :--- | | 03/31/2024 | $270,069,839 | $1,007,164,462 | $1,277,234,301 | | 03/31/2023 | $348,513,335 | $1,041,619,563 | $1,390,132,898 | Portfolio Mix by Customer Tenure at Origination (As of March 31) | As of | Less Than 2 Years (%) | More Than 2 Years (%) | | :--- | :--- | :--- | | 03/31/2024 | 21.1% | 78.9% | | 03/31/2023 | 25.1% | 74.9% | Year-Over-Year Growth (Decline) in Gross Loan Balance by Customer Tenure at Origination (12 Month Period Ended March 31, 2024) | 12 Month Period Ended | Less Than 2 Years (USD) | More Than 2 Years (USD) | Total (USD) | | :--- | :--- | :--- | :--- | | 03/31/2024 | $(78,443,496) | $(34,455,101) | $(112,898,597) | [Operating Expenses Analysis](index=4&type=section&id=Operating%20Expenses%20Analysis) General and administrative (G&A) expenses decreased in Q4 FY2024, primarily due to lower personnel and advertising costs, leading to a slight improvement in G&A expenses as a percentage of revenues - General and administrative (G&A) expenses decreased **$1.6 million**, or **2.1%**, to **$71.6 million** in Q4 FY2024 compared to **$73.2 million** in the same quarter of the prior fiscal year[16](index=16&type=chunk) - As a percentage of revenues, G&A expenses decreased from **45.5%** during Q4 FY2023 to **45.0%** during Q4 FY2024[16](index=16&type=chunk) - Personnel expense decreased **$2.2 million**, or **4.7%**, during Q4 FY2024, with headcount decreasing **6.6%** compared to March 31, 2023[17](index=17&type=chunk) - Advertising expense decreased **$0.3 million**, or **21.5%**, in Q4 FY2024 due to decreased spending on customer acquisition programs[18](index=18&type=chunk) [Debt and Capital Management](index=4&type=section&id=Debt%20and%20Capital%20Management) Interest expense decreased in Q4 FY2024, driven by a significant reduction in average debt outstanding, which also contributed to an improved debt-to-equity ratio - Interest expense for Q4 FY2024 decreased by **$0.4 million**, or **3.5%**, from the corresponding quarter of the previous year[19](index=19&type=chunk) - Average debt outstanding decreased **17.2%** from **$674.5 million** to **$558.3 million** when comparing Q4 FY2024 and Q4 FY2023, despite a **5.7% increase** in the effective interest rate[20](index=20&type=chunk) - The Company's debt to equity ratio decreased to **1.2:1** at March 31, 2024, compared to **1.6:1** at March 31, 2023[20](index=20&type=chunk) - The Company repurchased and canceled **$7.6 million** of its previously issued bonds for a purchase price of **$7.1 million** during the quarter[20](index=20&type=chunk) [Shareholder Returns and Performance Ratios](index=6&type=section&id=Shareholder%20Returns%20and%20Performance%20Ratios) The company demonstrated strong financial performance with improved return on average assets and equity on a trailing twelve-month basis, alongside continued share repurchase activities - Key return ratios for Q4 FY2024 included a **7.0% return on average assets** and a **19.1% return on average equity** (both on a trailing twelve-month basis)[21](index=21&type=chunk) - The Company repurchased **146,436 shares** of its common stock for approximately **$19.0 million** during Q4 FY2024[22](index=22&type=chunk) - For the full fiscal year 2024, a total of **295,201 shares** were repurchased for approximately **$36.2 million**[22](index=22&type=chunk) [Full Fiscal Year 2024 Results (Twelve Months Ended March 31, 2024)](index=6&type=section&id=Full%20Fiscal%20Year%202024%20Results%20(Twelve%20Months%20Ended%20March%2031,%202024)) For the full fiscal year 2024, World Acceptance Corporation reported a substantial increase in net income and diluted EPS, despite a decrease in total revenues, and achieved a significant improvement in annualized net charge-offs Full Fiscal Year Performance (Twelve Months Ended March 31) | Metric | FY 2024 (USD) | FY 2023 (USD) | Change | | :--- | :--- | :--- | :--- | | Net income | $77.3 million | $21.2 million | +264.6% | | Diluted net income per share | $13.19 | $3.60 | +266.4% | | Total revenues | $573.2 million | $616.5 million | -7.0% | - Annualized net charge-offs as a percent of average net loans decreased from **23.7%** during fiscal 2023 to **17.7%** for fiscal 2024[23](index=23&type=chunk) [Company Information](index=6&type=section&id=Company%20Information) This section provides an overview of World Acceptance Corporation's business model and details regarding its upcoming financial results conference call [About World Acceptance Corporation](index=6&type=section&id=About%20World%20Acceptance%20Corporation) World Acceptance Corporation, operating as World Finance, is a people-focused finance company established in 1962, providing personal installment loans and tax preparation services through over 1,000 branches - Founded in 1962, World Acceptance Corporation (NASDAQ: WRLD) provides personal installment loan solutions and personal tax preparation and filing services[24](index=24&type=chunk) - The Company operates more than **1,000 community-based World Finance branches** across **16 states**, headquartered in Greenville, South Carolina[24](index=24&type=chunk) - It primarily serves a segment of the population that does not have ready access to credit, focusing on understanding customers' financial pictures and ensuring their ability to make payments[24](index=24&type=chunk) [Conference Call Details](index=6&type=section&id=Conference%20Call%20Details) World Acceptance Corporation's senior management will host a conference call to discuss the financial results, with a live simulcast and replay available online - A quarterly conference call will be held at **10:00 a.m. Eastern Time on May 2, 2024**[25](index=25&type=chunk) - A simulcast of the conference call will be available on the Internet at https://event.choruscall.com/mediaframe/webcast.html?webcastid=jzCjKJe2 and will be available for replay for approximately **30 days**[25](index=25&type=chunk) [Legal Disclosures](index=7&type=section&id=Legal%20Disclosures) This section outlines important legal disclaimers regarding forward-looking statements, emphasizing inherent risks and the company's non-obligation to update such information [Cautionary Note Regarding Forward-Looking Information](index=7&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Information) This section advises that the press release contains forward-looking statements subject to inherent risks and uncertainties, which could cause actual results to differ materially from those projected - The press release may contain 'forward-looking statements' subject to risks and uncertainties, including legislative changes, regulatory authority, litigation, employee misconduct, management turnover, economic factors, interest rates, inflation, cybersecurity threats, and dependence on debt[28](index=28&type=chunk) - The Company's actual results and financial condition may differ materially from those indicated in the forward-looking statements, and readers should not rely on them[28](index=28&type=chunk) - World Acceptance Corporation does not undertake any obligation to update any forward-looking statements[29](index=29&type=chunk) [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) This section provides the unaudited consolidated financial statements, including statements of operations, balance sheets, and selected key statistics for the reported periods [Consolidated Statements of Operations](index=8&type=section&id=Consolidated%20Statements%20of%20Operations) This section presents the unaudited consolidated statements of operations for the three and twelve months ended March 31, 2024, and 2023, detailing revenues, expenses, and net income Consolidated Statements of Operations (unaudited, in thousands, except per share amounts) | Metric | Three months ended March 31, 2024 (USD) | Three months ended March 31, 2023 (USD) | Twelve months ended March 31, 2024 (USD) | Twelve months ended March 31, 2023 (USD) | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $159,265 | $160,837 | $573,214 | $616,546 | | Provision for credit losses | $29,276 | $45,412 | $156,973 | $259,463 | | Total general and administrative expenses | $71,619 | $73,178 | $268,600 | $279,475 | | Interest expense | $11,757 | $12,185 | $48,232 | $50,463 | | Total expenses | $112,652 | $130,775 | $473,805 | $589,401 | | Income before income taxes | $46,613 | $30,062 | $99,409 | $27,145 | | Net income | $35,058 | $24,632 | $77,346 | $21,231 | | Net income per common share, diluted | $6.09 | $4.20 | $13.19 | $3.60 | [Consolidated Balance Sheets](index=9&type=section&id=Consolidated%20Balance%20Sheets) This section provides the unaudited consolidated balance sheets as of March 31, 2024, 2023, and 2022, detailing the company's assets, liabilities, and shareholders' equity Consolidated Balance Sheets (unaudited, in thousands) | Metric | March 31, 2024 (USD) | March 31, 2023 (USD) | March 31, 2022 (USD) | | :--- | :--- | :--- | :--- | | Total assets | $1,056,351 | $1,117,319 | $1,218,296 | | Gross loans receivable | $1,277,149 | $1,390,016 | $1,522,789 | | Allowance for credit losses | $(102,963) | $(125,553) | $(134,243) | | Loans receivable, net | $847,440 | $887,788 | $985,515 | | Total liabilities | $631,924 | $732,092 | $845,272 | | Senior notes payable | $223,419 | $307,911 | $396,973 | | Senior unsecured notes payable, net | $272,610 | $287,353 | $295,394 | | Shareholders' equity | $424,427 | $385,227 | $373,024 | [Selected Consolidated Statistics](index=10&type=section&id=Selected%20Consolidated%20Statistics) This section provides selected unaudited consolidated statistics for the three and twelve months ended March 31, 2024, and 2023, including loan metrics, expense ratios, and key performance indicators Selected Consolidated Statistics (unaudited, in thousands, except percentages and branches) | Metric | Q4 FY24 (USD) | Q4 FY23 (USD) | FY24 (USD) | FY23 (USD) | | :--- | :--- | :--- | :--- | :--- | | Gross loans receivable | $1,277,149 | $1,390,016 | $1,277,149 | $1,390,016 | | Average gross loans receivable | $1,357,845 | $1,481,111 | $1,378,329 | $1,555,655 | | Net charge-offs as percent of average net loans receivable on an annualized basis | 18.8% | 23.9% | 17.7% | 23.7% | | Return on average assets (trailing 12 months) | 7.0% | 1.7% | 7.0% | 1.7% | | Return on average equity (trailing 12 months) | 19.1% | 5.8% | 19.1% | 5.8% | | Branches open (at period end) | 1,048 | 1,073 | 1,048 | 1,073 | | Provision for credit losses as % of total revenue | 18.4% | 28.2% | 27.4% | 42.1% | | General and administrative as % of total revenue | 45.0% | 45.5% | 46.9% | 45.3% | | Operating income as a % of total revenue | 36.7% | 26.3% | 25.8% | 12.6% |

[PART I - FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) This section presents the company's consolidated financial statements, management's analysis, market risk disclosures, and internal controls [Item 1. Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) The unaudited consolidated financial statements for the period ended December 31, 2023, show improved profitability, with net income reaching **$16.7 million** for the quarter and **$42.3 million** for the nine-month period, reversing a prior-year loss, primarily due to a lower provision for credit losses [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of December 31, 2023, total assets were **$1.12 billion**, a slight increase from **$1.12 billion** at March 31, 2023, driven by higher net loans receivable, while total liabilities decreased, leading to an increase in shareholders' equity to **$407.0 million** | Balance Sheet Items | Dec 31, 2023 ($) | Mar 31, 2023 ($) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | 12,775,524 | 16,508,935 | | Loans receivable, net | 907,229,249 | 887,788,486 | | Total assets | 1,119,538,669 | 1,117,318,141 | | **Liabilities & Equity** | | | | Senior notes payable | 305,089,480 | 307,910,824 | | Senior unsecured notes payable, net | 279,915,756 | 287,352,892 | | Total liabilities | 712,519,503 | 732,091,404 | | Total shareholders' equity | 407,019,166 | 385,226,737 | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) For Q3 FY24, net income was **$16.7 million**, a **187% increase** from the prior-year quarter, and for the nine months, net income was **$42.3 million**, a significant turnaround from a **$3.4 million loss**, primarily due to a substantial reduction in the provision for credit losses | Metric | Three Months Ended Dec 31, 2023 ($) | Three Months Ended Dec 31, 2022 ($) | Nine Months Ended Dec 31, 2023 ($) | Nine Months Ended Dec 31, 2022 ($) | | :--- | :--- | :--- | :--- | :--- | | Total revenues | 137,749,387 | 146,532,150 | 413,948,499 | 455,708,616 | | Provision for credit losses | 40,631,994 | 59,608,655 | 127,697,072 | 214,051,068 | | Net income (loss) | 16,664,818 | 5,804,586 | 42,285,985 | (3,399,465) | | Diluted EPS | 2.84 | 0.99 | 7.17 | (0.59) | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) Shareholders' equity increased from **$385.2 million** to **$407.0 million** by December 31, 2023, driven by **$42.3 million** in net income, partially offset by **$17.3 million** in common stock repurchases - For the nine months ended December 31, 2023, total shareholders' equity increased by **$21.8 million**, reflecting the net effect of **$42.3 million** in net income and **$17.3 million** in common stock repurchases[21](index=21&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended December 31, 2023, the company generated **$182.0 million** in cash from operating activities, used **$157.3 million** in investing activities, and **$28.4 million** in financing activities, resulting in a net decrease in cash of **$3.7 million** | Cash Flow Activity (Nine months ended Dec 31, 2023) | Amount ($) | | :--- | :--- | | Net cash provided by operating activities | 181,969,945 | | Net cash used in investing activities | (157,309,595) | | Net cash provided by (used in) financing activities | (28,393,761) | | **Net change in cash and cash equivalents** | **(3,733,411)** | [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, including the CECL model for credit losses, debt structure, stock-based compensation reversals, operating lease obligations, and income tax positions - The company's allowance for credit losses is primarily determined by segmenting its loan portfolio into pools based on customer tenure, which management identified as the strongest predictor of default risk[53](index=53&type=chunk)[55](index=55&type=chunk) | Allowance for Credit Losses Roll-forward | Nine Months Ended Dec 31, 2023 ($) | Nine Months Ended Dec 31, 2022 ($) | | :--- | :--- | :--- | | Beginning balance | 125,552,733 | 134,242,862 | | Provision for credit losses | 127,697,072 | 214,051,068 | | Net charge-offs | (132,167,737) | (203,754,387) | | **Ending Balance** | **121,082,068** | **144,539,543** | - During the first nine months of fiscal 2024, the company repurchased and extinguished **$8.25 million** of its senior unsecured notes, recognizing a **$1.2 million** gain on extinguishment[106](index=106&type=chunk) - A reversal of **$4.9 million** in previously recognized stock-based compensation occurred in the second quarter of fiscal 2024, as it was determined that the performance targets for certain Performance Options were no longer probable of being achieved[89](index=89&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported a **187.1% increase** in Q3 net income year-over-year, driven by a **31.8% decrease** in the provision for credit losses, despite a **6.0% decline** in revenue, while addressing regulatory matters and improving the debt-to-equity ratio [Results of Operations](index=35&type=section&id=Results%20of%20Operations) For Q3 FY24, net income surged **187.1%** to **$16.7 million**, primarily due to a **$19.0 million (31.8%) decrease** in the provision for credit losses, despite a **6.0%** fall in total revenues, with net charge-offs improving significantly - Gross loans outstanding decreased **9.9%** YoY to **$1.40 billion** as of December 31, 2023, but the company eased underwriting standards, resulting in a **2.4% increase** in unique borrowers during the quarter[125](index=125&type=chunk) | Metric (Q3 FY24 vs Q3 FY23) | Q3 FY2024 | Q3 FY2023 | Change | | :--- | :--- | :--- | :--- | | Net Income | $16.7M | $5.8M | +187.1% | | Total Revenues | $137.7M | $146.5M | -6.0% | | Provision for Credit Losses | $40.6M | $59.6M | -31.8% | | Net Charge-offs (annualized %) | 19.1% | 25.1% | -6.0 p.p. | - For the nine months ended Dec 31, 2023, net income increased to **$42.3 million** from a **$3.4 million loss** in the prior year, driven by an **$86.4 million (40.3%) decrease** in the provision for credit losses[143](index=143&type=chunk)[147](index=147&type=chunk) [Regulatory Matters](index=40&type=section&id=Regulatory%20Matters) The company is monitoring a CFPB rule on payment requirements, currently under U.S. Supreme Court review, and expects a supervisory review soon after the CFPB asserted its "dormant authority" over the company - A CFPB rule imposing payment requirements on certain loans was vacated by the Fifth Circuit, but the decision is currently under review by the U.S. Supreme Court, creating uncertainty about its future implementation[156](index=156&type=chunk) - The CFPB has asserted its supervisory authority over the company using its "dormant authority" to examine nonbank entities that pose risks to consumers, and the company expects a supervisory review soon[158](index=158&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains liquidity through cash from operations and its revolving credit facility, with **$274.4 million** available as of December 31, 2023, an improved debt-to-equity ratio of **1.4:1.0**, and ongoing share repurchase programs - Primary sources of liquidity are cash flows from operations (**$182.0 million** for the nine months ended Dec 31, 2023) and borrowings from institutional lenders[160](index=160&type=chunk) - As of December 31, 2023, the company had **$274.4 million** of unused availability under its revolving credit facility, and its debt-to-equity ratio was **1.4:1.0**[169](index=169&type=chunk)[174](index=174&type=chunk) - The Board of Directors authorized a **$20.0 million** share repurchase program in November 2023, with **$2.8 million** remaining under this authorization and approximately **$33.2 million** permitted under debt covenants as of December 31, 2023[176](index=176&type=chunk)[177](index=177&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risk is interest rate fluctuations on its variable-rate revolving credit facility, where a **1.0%** change would alter annual interest expense by approximately **$3.1 million** - The company's main market risk is interest rate risk, where a **1.0%** change in interest rates would cause an annual change in interest expense of approximately **$3.1 million** on its revolving credit facility balance as of December 31, 2023[189](index=189&type=chunk) [Item 4. Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of December 31, 2023, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures are effective to provide reasonable assurance of timely and accurate reporting[191](index=191&type=chunk) - No changes occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[190](index=190&type=chunk) [PART II - OTHER INFORMATION](index=45&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, and details on unregistered sales of equity securities and use of proceeds [Item 1. Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various litigation matters arising from normal business operations, and while estimating potential losses is difficult, an adverse outcome could materially affect its financial condition - The company is subject to litigation in the normal course of business, and while it cannot easily estimate losses, an adverse outcome could have a material adverse effect on financial results[116](index=116&type=chunk)[117](index=117&type=chunk) [Item 1A. Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended March 31, 2023, were reported - No material changes to the company's risk factors were reported for the quarter[195](index=195&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q3 FY24, the company repurchased **148,765** shares of common stock at an average price of **$115.42** per share, totaling approximately **$17.2 million**, with **$2.8 million** remaining available for repurchase | Period | Total Shares Purchased | Average Price Paid ($) | Total Cost ($) | | :--- | :--- | :--- | :--- | | Oct 2023 | 0 | — | 0 | | Nov 2023 | 64,062 | 110.18 | 7,058,424 | | Dec 2023 | 84,703 | 119.38 | 10,112,101 | | **Total for Quarter** | **148,765** | **115.42** | **17,170,525** | - As of December 31, 2023, the company had **$2.8 million** remaining in its share repurchase authorization[196](index=196&type=chunk)[197](index=197&type=chunk)

Financial Data and Key Metrics Changes - New customer loan volume increased approximately 22% sequentially from the prior quarter and about 56% compared to last year's third quarter [4] - First pay defaults remain at or below historical norms, indicating improved credit quality performance [5] - Overall new customer application volume has returned to within 1% of pre-COVID levels, with a 30% increase compared to last year's third quarter [6] Business Line Data and Key Metrics Changes - Approval and booking rates have significantly improved from lows in August, with a 22% increase in booked new customer lines sequentially [5] - Return of former customers increased around 6% sequentially and 17% compared to last year's third quarter [6] - Yields for new customers and the overall portfolio continue to improve due to better gross yields and reduced delinquency [7] Market Data and Key Metrics Changes - The company has seen a seasonal adjustment in expected loss rates, with December being the lowest risk quarter historically [10] - The impact of tax refund season on customer behavior remains uncertain, as it is still early in the tax filing process [15] Company Strategy and Development Direction - The company has been tightening credit since April 2021, focusing on improving underwriting and marketing strategies without sacrificing credit quality for growth [20] - Management is cautious about macroeconomic conditions and is not considering loosening credit standards for growth [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the improved credit quality and operating conditions, with expectations of economic stability increasing [7] - The company aims to transition from a conservative growth approach to a more aggressive growth strategy while maintaining prudent credit standards [20] Other Important Information - The company continues to accrue for long-term incentive plans with earnings per share targets of $16.35 and $20.45 by the end of fiscal year 2025 [12] Q&A Session Summary Question: What change in assumptions drove the $10 million provision release? - The reduction is primarily due to seasonal factors, as December is historically the lowest risk quarter [10] Question: How does lifetime loss accounting factor into seasonal trends? - Seasonal factors still influence expected losses at a point in time, affecting reserve levels [11] Question: What are the expectations for tax refund season this year? - It is too early to determine the impact of tax refunds on the customer base [15] Question: What does the future look like for loan metrics in fiscal 2025? - The company expects continued improvement in credit quality and portfolio yields, treating current metrics as the norm going forward [18] Question: What macro trends are being monitored before significant portfolio growth? - The company remains conservative and is focused on maintaining credit quality while cautiously considering growth opportunities [20]

[GLOSSARY OF DEFINED TERMS](index=4&type=section&id=GLOSSARY%20OF%20DEFINED%20TERMS) This glossary defines key terms, accounting standards, and financial instruments essential for understanding the report - The glossary defines key terms used throughout the report, including accounting standards (**ASC, ASU, CECL, GAAP**), company roles (**CEO, CFO**), regulatory bodies (**CFPB, DOJ, SEC**), financial metrics (**Customer Tenure, Rehab Rate**), and specific financial instruments (**Notes, Performance Options, Restricted Stock, TAL**)[11](index=11&type=chunk) PART I - FINANCIAL INFORMATION [Consolidated Financial Statements (unaudited)](index=5&type=section&id=1.%20Consolidated%20Financial%20Statements%20(unaudited)) This section presents the Company's unaudited consolidated financial statements and accompanying detailed explanatory notes [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20September%2030%2C%202023%20and%20March%2031%2C%202023) This section details the Company's financial position, including assets, liabilities, and shareholders' equity, at specific reporting dates Consolidated Balance Sheet Highlights (in thousands of dollars) | Metric | September 30, 2023 | March 31, 2023 | | :-------------------------- | :------------------- | :------------------- | | Total Assets | $1,105,699 | $1,117,318 | | Gross loans receivable | $1,379,514 | $1,390,016 | | Loans receivable, net | $880,309 | $887,788 | | Total Liabilities | $695,677 | $732,091 | | Total Shareholders' Equity | $410,023 | $385,227 | - Total assets decreased by approximately **$11.6 million**, or **1.04%**, from March 31, 2023, to September 30, 2023[13](index=13&type=chunk) - Total shareholders' equity increased by approximately **$24.8 million**, or **6.44%**, from March 31, 2023, to September 30, 2023, primarily driven by retained earnings[15](index=15&type=chunk) [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations%20for%20the%20three%20and%20six%20months%20ended%20September%2030%2C%202023%20and%20September%2030%2C%202022) This section presents the Company's financial performance, detailing revenues, expenses, and net income or loss over specific periods Consolidated Statements of Operations Highlights (in thousands of dollars) | Metric | 3 months ended Sep 30, 2023 | 3 months ended Sep 30, 2022 | 6 months ended Sep 30, 2023 | 6 months ended Sep 30, 2022 | | :-------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total revenues | $136,875 | $151,258 | $276,199 | $309,176 | | Provision for credit losses | $40,463 | $68,620 | $87,065 | $154,442 | | Total general and administrative expenses | $62,948 | $69,694 | $131,073 | $141,345 | | Net income (loss) | $16,082 | $(638) | $25,621 | $(9,204) | | Basic Net income (loss) per common share | $2.78 | $(0.11) | $4.44 | $(1.61) | - Net income for the three months ended September 30, 2023, significantly increased to **$16.1 million** from a net loss of **$0.6 million** in the prior year, representing a **2,622.4%** increase[17](index=17&type=chunk) - The provision for credit losses decreased by **41.0%** for the three months ended September 30, 2023, and by **43.6%** for the six months ended September 30, 2023, compared to the respective prior year periods[17](index=17&type=chunk) [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders%27%20Equity%20for%20the%20three%20and%20six%20months%20ended%20September%2030%2C%202023%20and%20September%2030%2C%202022) This section details changes in shareholders' equity, including net income, stock-based compensation, and stock option exercises, over specific periods Shareholders' Equity Changes (Six months ended September 30, 2023, in thousands of dollars) | Item | Amount | | :---------------------------------------------------------------- | :----------- | | Balances at March 31, 2023 | $385,227 | | Proceeds from exercise of stock options | $1,070 | | Stock-based compensation related to restricted stock, net of cancellations | $2,166 | | Stock-based compensation (reversal) related to stock options | $(4,061) | | Net income | $25,621 | | Balances at September 30, 2023 | $410,023 | - Total shareholders' equity increased from **$385.2 million** at March 31, 2023, to **$410.0 million** at September 30, 2023, primarily due to net income of **$25.6 million**[20](index=20&type=chunk) - A significant reversal of **$4.1 million** in stock-based compensation related to stock options occurred during the six months ended September 30, 2023[20](index=20&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20six%20months%20ended%20September%2030%2C%202023%20and%20September%2030%2C%202022) This section categorizes cash movements into operating, investing, and financing activities, illustrating the Company's liquidity and cash generation Consolidated Statements of Cash Flows Highlights (Six months ended September 30, in thousands of dollars) | Cash Flow Activity | 2023 | 2022 | | :----------------------------------- | :----------- | :----------- | | Net cash provided by operating activities | $123,086 | $136,658 | | Net cash used in investing activities | $(87,276) | $(174,600) | | Net cash provided by (used in) financing activities | $(33,533) | $39,401 | | Net change in cash and cash equivalents | $2,277 | $1,458 | | Cash and cash equivalents at end of period | $18,786 | $20,695 | - Net cash provided by operating activities decreased by approximately **$13.6 million**, or **9.99%**, for the six months ended September 30, 2023, compared to the prior year[24](index=24&type=chunk) - Net cash used in investing activities significantly decreased by approximately **$87.3 million**, or **50.0%**, primarily due to a smaller increase in loans receivable and no cash paid for acquisitions in 2023[24](index=24&type=chunk) - Financing activities shifted from providing **$39.4 million** in cash in 2022 to using **$33.5 million** in 2023, mainly due to higher payments on senior notes payable[24](index=24&type=chunk) [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes offer detailed explanations and additional information for the consolidated financial statements, covering policies, estimates, and specific items [NOTE 1 – BASIS OF PRESENTATION](index=12&type=section&id=NOTE%201%20%E2%80%93%20BASIS%20OF%20PRESENTATION) This note outlines the basis for preparing the unaudited consolidated financial statements, emphasizing Form 10-Q compliance and management estimates - The consolidated financial statements are unaudited and prepared in accordance with Form 10-Q, including all necessary normal, recurring adjustments for fair presentation[27](index=27&type=chunk) - Management's estimates and assumptions are used in preparing the financial statements, and actual results may differ[28](index=28&type=chunk) - These interim statements should be read in conjunction with the Company's audited consolidated financial statements in its Annual Report on Form 10-K for the fiscal year ended March 31, 2023[29](index=29&type=chunk) [NOTE 2 – SUMMARY OF SIGNIFICANT POLICIES](index=12&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20POLICIES) This note describes the Company's business model, seasonal loan trends, and the impact of recently adopted accounting pronouncements - The Company is a small-loan consumer finance company offering short-term and medium-term loans, related credit insurance, ancillary products, and income tax return preparation services[30](index=30&type=chunk) - Loan volume and repayment follow seasonal trends, with highest demand from October to December (Q3) and lowest demand/highest repayment from January to March (Q4)[31](index=31&type=chunk) - The adoption of ASU 2022-02 on April 1, 2023, expanded write-off disclosures but had no other material impact on the Company's Consolidated Financial Statements[38](index=38&type=chunk) [NOTE 3 – FAIR VALUE](index=14&type=section&id=NOTE%203%20%E2%80%93%20FAIR%20VALUE) This note details the Company's fair value measurements for financial instruments, categorized into three levels based on input observability - Fair value measurements are categorized into three levels based on the observability of inputs, with Level 1 for active market quoted prices, Level 2 for observable inputs other than quoted prices, and Level 3 for unobservable inputs[41](index=41&type=chunk) Fair Value of Financial Instruments (September 30, 2023, in thousands of dollars) | Instrument | Carrying Value | Estimated Fair Value | Input Level | | :-------------------------- | :------------------- | :------------------- | :---------- | | Cash and cash equivalents | $18,786 | $18,786 | 1 | | Loans receivable, net | $880,309 | $880,309 | 3 | | Senior unsecured notes payable | $287,360 | $246,176 | 2 | | Senior notes payable | $276,556 | $276,556 | 3 | [NOTE 4 – LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES](index=14&type=section&id=NOTE%204%20%E2%80%93%20LOANS%20RECEIVABLE%20AND%20ALLOWANCE%20FOR%20CREDIT%20LOSSES) This note details loans receivable, including customer tenure segmentation, and the methodology and changes in the allowance for credit losses Gross Loans Receivable by Customer Tenure (in thousands of dollars) | Customer Tenure | September 30, 2023 | March 31, 2023 | | :---------------- | :------------------- | :------------------- | | 0 to 5 months | $78,906 | $81,804 | | 6 to 17 months | $98,861 | $133,650 | | 18 to 35 months | $151,877 | $135,396 | | 36 to 59 months | $226,824 | $244,414 | | 60+ months | $822,889 | $792,189 | | Tax advance loans | $157 | $2,562 | | Total gross loans | $1,379,514 | $1,390,016 | - Customer Tenure is identified as the strongest predictor of default risk and is used to aggregate loans into pools for the CECL allowance calculation[53](index=53&type=chunk) Allowance for Credit Losses Roll Forward (Six months ended September 30, in thousands of dollars) | Metric | 2023 | 2022 | | :------------------------ | :----------- | :----------- | | Beginning balance | $125,553 | $134,243 | | Provision for credit losses | $87,065 | $154,442 | | Charge-offs | $(102,494) | $(142,350) | | Recoveries | $18,768 | $9,556 | | Ending Balance | $128,892 | $155,892 | - The Company reversed **$13.4 million** of unpaid accrued interest against interest income for the six months ended September 30, 2023, compared to **$20.4 million** in the prior year, as loans moved to nonaccrual status[59](index=59&type=chunk) [NOTE 5 – LEASES](index=24&type=section&id=NOTE%205%20%E2%80%93%20LEASES) This note describes the Company's operating lease arrangements for office space and equipment, including terms, costs, and weighted-average metrics - The Company's leases primarily consist of operating leases for office space and equipment, with terms generally ranging from three to five years and options to extend[63](index=63&type=chunk) - As of September 30, 2023, the Company had no finance leases, having exercised purchase options for IT equipment when prior finance lease terms expired in fiscal 2023[64](index=64&type=chunk) Total Lease Cost (Three and Six months ended September 30, in thousands of dollars) | Metric | 3 months ended Sep 30, 2023 | 3 months ended Sep 30, 2022 | 6 months ended Sep 30, 2023 | 6 months ended Sep 30, 2022 | | :---------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total lease cost | $7,253 | $8,628 | $14,757 | $16,325 | - The weighted-average remaining lease term for operating leases was **7.0 years**, with a weighted-average discount rate of **6.2%** as of September 30, 2023[66](index=66&type=chunk) [NOTE 6 – AVERAGE SHARE INFORMATION](index=26&type=section&id=NOTE%206%20%E2%80%93%20AVERAGE%20SHARE%20INFORMATION) This note presents weighted average common shares outstanding for basic and diluted EPS calculations, explaining factors affecting dilution Weighted Average Common Shares Outstanding (Three and Six months ended September 30) | Metric | 3 months ended Sep 30, 2023 | 3 months ended Sep 30, 2022 | 6 months ended Sep 30, 2023 | 6 months ended Sep 30, 2022 | | :------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Basic | 5,780,061 | 5,726,469 | 5,776,417 | 5,733,613 | | Diluted | 5,938,705 | 5,726,469 | 5,915,023 | 5,733,613 | - Dilutive potential common shares were excluded from the weighted average diluted shares outstanding calculation for the three and six months ended September 30, 2022, because the Company incurred a loss from continuing operations[68](index=68&type=chunk) [NOTE 7 – STOCK-BASED COMPENSATION](index=27&type=section&id=NOTE%207%20%E2%80%93%20STOCK-BASED%20COMPENSATION) This note details the Company's stock incentive plans, award types, vesting conditions, and the financial impact of stock-based compensation - The Company maintains stock incentive plans (2008, 2011, and 2017) for directors, officers, and key employees, reserving **3,350,000 shares** for grants[69](index=69&type=chunk) - The long-term incentive program includes Service Options, Performance Options, Restricted Stock, and Performance Shares, with vesting tied to continued employment and, for performance awards, specific EPS targets[71](index=71&type=chunk)[73](index=73&type=chunk)[77](index=77&type=chunk) Total Stock-Based Compensation (Reversal) Related to Equity Classified Awards (Three and Six months ended September 30, in thousands of dollars) | Metric | 3 months ended Sep 30, 2023 | 3 months ended Sep 30, 2022 | 6 months ended Sep 30, 2023 | 6 months ended Sep 30, 2022 | | :---------------------------------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Stock-based compensation (reversal) related to stock options | $(4,374) | $677 | $(4,061) | $1,445 | | Stock-based compensation related to restricted stock | $1,067 | $3,144 | $2,166 | $6,192 | | Total stock-based compensation (reversal) | $(3,308) | $3,821 | $(1,895) | $7,637 | - A **$4.9 million** reversal of previously recognized stock-based compensation related to Performance Options occurred in the second quarter of fiscal 2024, as the performance target was deemed no longer probable of being achieved[92](index=92&type=chunk) [NOTE 8 – ACQUISITIONS](index=31&type=section&id=NOTE%208%20%E2%80%93%20ACQUISITIONS) This note outlines the Company's acquisition activities, including acquired loan portfolios and their financial impact, noting no acquisitions in the current period Acquisition Activity (Six months ended September 30, in thousands of dollars) | Metric | 2023 | 2022 | | :------------------------------------------ | :--- | :----------- | | Number of loan portfolios acquired | — | 43 | | Purchase price | $— | $22,315 | | Loans receivable, net acquired | — | $27,105 | | Purchase price amount below carrying value of net tangible assets | — | $(4,790) | - The Company had no acquisition activity for the six months ended September 30, 2023, compared to **43** loan portfolio acquisitions in the prior year[91](index=91&type=chunk) - Acquired loans are valued at their net loan balance and are included in the CECL reserve calculations[94](index=94&type=chunk) [NOTE 9 – DEBT](index=32&type=section&id=NOTE%209%20%E2%80%93%20DEBT) This note describes the Company's debt structure, including revolving credit facility amendments, outstanding balances, interest rates, and covenant compliance - On July 18, 2023, the Company amended its revolving credit facility, reducing total commitments to **$580 million**, extending maturity to June 7, 2026, and adjusting financial covenants[98](index=98&type=chunk) - As of September 30, 2023, **$276.6 million** was outstanding under the revolving credit facility, with an effective interest rate of **9.8%** annualized for the six months ended September 30, 2023[100](index=100&type=chunk)[101](index=101&type=chunk) - During the first six months of fiscal 2024, the Company repurchased and extinguished **$3.5 million** of its senior unsecured notes, recognizing a **$0.6 million** gain on extinguishment[105](index=105&type=chunk) - The Company was in compliance with all debt covenants under its revolving credit facility and senior unsecured notes indenture as of September 30, 2023[107](index=107&type=chunk) [NOTE 10 – INCOME TAXES](index=34&type=section&id=NOTE%2010%20%E2%80%93%20INCOME%20TAXES) This note explains the Company's effective income tax rate, factors influencing its changes, and the amount of unrecognized tax benefits - The Company's effective income tax rate was **23.1%** for the quarter ended September 30, 2023, a significant improvement from **(618.9)%** in the prior year quarter[114](index=114&type=chunk) - This change was primarily due to the effects of pretax book earnings, a decrease in disallowed executive compensation, and the recognition of additional Historic Tax Credits (HTCs)[114](index=114&type=chunk) - As of September 30, 2023, the Company had **$1.2 million** in total gross unrecognized tax benefits[111](index=111&type=chunk) [NOTE 11 – COMMITMENTS AND CONTINGENCIES](index=35&type=section&id=NOTE%2011%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) This note addresses the Company's litigation involvement, highlighting difficulties in estimating potential losses and possible adverse financial impact - The Company is involved in various litigation matters arising from its operations in the normal course of business[115](index=115&type=chunk) - Estimating potential losses from litigation is inherently difficult due to indeterminate claims, discretionary fines, regulatory changes, and early stages of proceedings[116](index=116&type=chunk) - An adverse outcome in one or more of these matters could materially and adversely affect the Company's financial condition, results of operations, or cash flows[116](index=116&type=chunk) [NOTE 12 – SUBSEQUENT EVENTS](index=35&type=section&id=NOTE%2012%20%E2%80%93%20SUBSEQUENT%20EVENTS) This note confirms that management is unaware of any significant events subsequent to the balance sheet date that would materially affect the financial statements - Management is not aware of any significant events occurring subsequent to the balance sheet date that would have a material effect on the financial statements[117](index=117&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=2.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the Company's financial condition and operating results, covering improved net income, credit losses, regulatory matters, liquidity, and critical accounting policies - Net income for the three months ended September 30, 2023, increased by **2,622.4%** to **$16.1 million** from a net loss of **$0.6 million** in the prior year[125](index=125&type=chunk) - Gross loans outstanding decreased by **13.7%** to **$1.38 billion** as of September 30, 2023, compared to the prior year, primarily due to tighter underwriting standards[124](index=124&type=chunk)[142](index=142&type=chunk) - The provision for credit losses decreased by **41.0%** for the three months and **43.6%** for the six months ended September 30, 2023, driven by lower charge-offs and smaller increases in 90-day past due loans[128](index=128&type=chunk)[130](index=130&type=chunk)[147](index=147&type=chunk) - Net charge-offs as a percentage of average net loan receivables on an annualized basis decreased from **23.0%** to **16.1%** for the three months ended September 30, 2023[131](index=131&type=chunk) [Cautionary Note Regarding Forward-Looking Information](index=36&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Information) This note advises that forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from projections - The report contains forward-looking statements based on management's beliefs and assumptions, which are subject to risks, uncertainties, and assumptions that could cause actual results to differ materially[119](index=119&type=chunk) - Key factors influencing actual results include legislation, regulatory authority, litigation, management turnover, accounting rule changes, interest rates, inflation, acquisitions, loan risks, cybersecurity, and debt dependence[120](index=120&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) This section analyzes the Company's financial performance, detailing changes in revenues, expenses, net income, and key operating ratios for the reporting periods Key Operating Data and Ratios (Three months ended September 30, in thousands of dollars) | Metric | 2023 | 2022 | Change (%) | | :-------------------------------------------------- | :----------- | :----------- | :--------- | | Gross loans receivable | $1,379,514 | $1,598,361 | -13.7% | | Net income (loss) | $16,082 | $(638) | 2622.4% | | Total revenues | $136,875 | $151,258 | -9.5% | | Provision for credit losses | $40,463 | $68,620 | -41.0% | | General and administrative expenses | $62,948 | $69,694 | -9.7% | | Interest expense | $12,543 | $13,032 | -3.8% | | Net charge-offs as % of avg net loans (annualized) | 16.1% | 23.0% | -6.9 ppt | | Return on average assets (trailing 12 months) | 5.0% | 1.3% | +3.7 ppt | | Return on average equity (trailing 12 months) | 15.2% | 4.1% | +11.1 ppt | Key Operating Data and Ratios (Six months ended September 30, in thousands of dollars) | Metric | 2023 | 2022 | Change (%) | | :-------------------------------------------------- | :----------- | :----------- | :--------- | | Gross loans receivable | $1,379,514 | $1,598,361 | -13.7% | | Net income (loss) | $25,621 | $(9,204) | 378.4% | | Total revenues | $276,199 | $309,176 | -10.7% | | Provision for credit losses | $87,065 | $154,442 | -43.6% | | General and administrative expenses | $131,073 | $141,345 | -7.3% | | Interest expense | $24,785 | $24,207 | +2.4% | | Net charge-offs as % of avg net loans (annualized) | 16.5% | 22.8% | -6.3 ppt | | Return on average assets (trailing 12 months) | 5.0% | 1.3% | +3.7 ppt | | Return on average equity (trailing 12 months) | 15.2% | 4.1% | +11.1 ppt | - Personnel expense decreased by **$6.9 million** (**15.1%**) for the three months ended September 30, 2023, largely due to a **$4.9 million** reversal of share-based compensation related to a performance-based share plan[135](index=135&type=chunk) - Advertising expense increased by **$1.2 million** (**122.0%**) for the three months and **$1.8 million** (**55.1%**) for the six months ended September 30, 2023, due to increased spending on customer acquisition programs[137](index=137&type=chunk)[151](index=151&type=chunk) [Regulatory Matters](index=40&type=section&id=Regulatory%20Matters) This section discusses the potential impact of the CFPB's Rule on consumer loans, its funding structure, and the Company's possible supervisory authority - The CFPB's Rule imposing limitations on certain consumer loans faces uncertainty due to a Fifth Circuit Court of Appeals decision challenging the CFPB's funding structure, with the U.S. Supreme Court currently reviewing the case[157](index=157&type=chunk) - The outcome of the Supreme Court's review, expected by June 2024, could impact the implementation of the Rule's payment requirements and necessitate changes to the Company's lending practices[157](index=157&type=chunk)[158](index=158&type=chunk) - The CFPB is considering rules to define 'larger participants' in consumer payments, which could bring the Company under its supervisory authority and subject it to reporting obligations and on-site compliance examinations[159](index=159&type=chunk) [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) This section examines the Company's ability to meet financial obligations through operating cash flows and borrowings, detailing its revolving credit facility and debt covenants - The Company finances its operations primarily through cash flows from operations and borrowings from institutional lenders, including a revolving credit facility and senior unsecured notes[161](index=161&type=chunk) - Net cash provided by operating activities for the six months ended September 30, 2023, was **$123.1 million**[161](index=161&type=chunk) - The revolving credit facility was amended in July 2023, extending its maturity to June 7, 2026, and the Company was in compliance with all debt covenants as of September 30, 2023[171](index=171&type=chunk)[174](index=174&type=chunk) - As of September 30, 2023, the Company's debt-to-equity ratio was **1.4:1.0**, and approximately **$42.0 million** of shares could be repurchased under the terms of its debt facilities, subject to Board approval[176](index=176&type=chunk)[180](index=180&type=chunk) [Inflation](index=44&type=section&id=Inflation) This section assesses inflation's potential impact on the Company's financial condition, expecting increased operating costs to be offset by higher loan demand - The Company does not believe that inflation, within reasonably anticipated rates, will have a material, adverse effect on its financial condition[181](index=181&type=chunk) - Increased operating costs due to inflation are expected to be offset by an increase in loan demand and revenue from a larger loan portfolio[181](index=181&type=chunk) [Quarterly Information and Seasonality](index=44&type=section&id=Quarterly%20Information%20and%20Seasonality) This section directs readers to Note 2 for detailed information on the Company's quarterly trends and seasonal business patterns - Refer to Note 2 to the unaudited Consolidated Financial Statements for detailed information on quarterly trends and seasonality[182](index=182&type=chunk) [Recently Adopted Accounting Pronouncements](index=44&type=section&id=Recently%20Adopted%20Accounting%20Pronouncements) This section refers to Note 2 for details on recently adopted accounting pronouncements and their impact on the Company's financial statements - Refer to Note 2 to the unaudited Consolidated Financial Statements for information on recently adopted accounting pronouncements[183](index=183&type=chunk) [Critical Accounting Policies](index=44&type=section&id=Critical%20Accounting%20Policies) This section highlights critical accounting policies, including allowance for credit losses, share-based compensation, and income taxes, involving significant management judgment - The Company's most critical accounting policies, involving significant management judgment and estimates, are the allowance for credit losses, share-based compensation, and income taxes[184](index=184&type=chunk) - The allowance for credit losses is management's best estimate of current expected credit losses, considering historical experience, current conditions, qualitative factors, and reasonable forecasts[185](index=185&type=chunk) - Share-based compensation is measured at fair value using the Black-Scholes model for stock options and quoted prices for restricted stock, requiring assumptions for volatility, risk-free rate, and expected life[186](index=186&type=chunk) - Income tax accounting involves considerable judgment in determining payable/refundable amounts, deferred assets/liabilities, and expense, subject to re-evaluation and potential adjustments by tax authorities[187](index=187&type=chunk)[188](index=188&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=44&type=section&id=3.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The Company's primary market risk is interest rate risk from its variable-rate revolving credit facility, with a 1.0% change impacting annual interest expense by approximately **$2.8 million** - The Company's outstanding debt under its revolving credit facility was **$276.6 million** at September 30, 2023[191](index=191&type=chunk) - Interest on borrowings under this facility is based on the greater of **4.5%** or one month SOFR plus **0.10%** and an applicable margin of **3.5%**[191](index=191&type=chunk) - A **1.0%** change in the interest rate would cause an approximate **$2.8 million** change in annual interest expense[191](index=191&type=chunk) [Controls and Procedures](index=44&type=section&id=4.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2023, with no material changes to internal control over financial reporting - There were no changes to internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting during the period[192](index=192&type=chunk) - The CEO and CFO concluded that the Company's disclosure controls and procedures were effective as of September 30, 2023, providing reasonable assurance that required information is recorded, processed, summarized, and reported timely[193](index=193&type=chunk) - A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that objectives are met, and benefits of controls must be considered relative to their costs[194](index=194&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=45&type=section&id=1.%20Legal%20Proceedings) This section refers to Note 11 for information on legal proceedings, detailing the Company's litigation involvement and difficulties in estimating potential losses - Refer to Note 11 to the unaudited Consolidated Financial Statements for information regarding legal proceedings[196](index=196&type=chunk) [Risk Factors](index=45&type=section&id=1A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2023 - No material changes to the risk factors disclosed in Part I, Item 1A of the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2023[197](index=197&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=2.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Board authorized a **$30.0 million** share repurchase program, with **$1.1 million** remaining as of September 30, 2023, and no shares repurchased this quarter - The Board of Directors authorized a **$30.0 million** share repurchase program on February 24, 2022[198](index=198&type=chunk) - As of September 30, 2023, the Company had **$1.1 million** in aggregate remaining repurchase capacity under its current share repurchase program[198](index=198&type=chunk) - No shares were purchased by the Company during the three months ended September 30, 2023[199](index=199&type=chunk) [Defaults Upon Senior Securities](index=45&type=section&id=3.%20Defaults%20Upon%20Senior%20Securities) The Company reported no defaults upon senior securities during the period - No defaults upon senior securities were reported[199](index=199&type=chunk) [Mine Safety Disclosures](index=45&type=section&id=4.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company's operations - Mine Safety Disclosures are not applicable to the Company[200](index=200&type=chunk) [Other Information](index=45&type=section&id=5.%20Other%20Information) No officers or directors entered into, modified, or terminated any Rule 10b5-1 trading arrangements during the quarter ended September 30, 2023 - None of the Company's officers and directors entered into, modified, or terminated any 'Rule 10b5-1 trading arrangements' or 'non-Rule 10b5-1 trading arrangements' during the quarter ended September 30, 2023[201](index=201&type=chunk) [Exhibits](index=46&type=section&id=6.%20Exhibits) This section indicates that the exhibits listed in the accompanying exhibit index are filed as part of this Quarterly Report on Form 10-Q - The exhibits listed in the accompanying exhibit index are filed as part of the Quarterly Report on Form 10-Q[202](index=202&type=chunk) [EXHIBIT INDEX](index=47&type=section&id=EXHIBIT%20INDEX) The Exhibit Index lists documents filed with Form 10-Q, including corporate governance, credit facility amendments, CEO/CFO certifications, and XBRL financial statements - Key exhibits include the Second Amended and Restated Articles of Incorporation, Eighth Amended and Restated Bylaws, and the Tenth Amendment to the Amended and Restated Revolving Credit Facility dated July 18, 2023[204](index=204&type=chunk) - The index also lists Rule 13a-14(a)/15d-14(a) and Section 1350 Certifications from the Chief Executive Officer and Chief Financial and Strategy Officer[204](index=204&type=chunk) - Inline XBRL formatted financial statements for the quarter ended September 30, 2023, are included as Exhibit 101.01[204](index=204&type=chunk) [SIGNATURES](index=48&type=section&id=SIGNATURES) The report is signed by Scott McIntyre, Senior Vice President of Accounting and principal accounting officer, on November 3, 2023 - The report is signed by Scott McIntyre, Senior Vice President of Accounting, as the principal accounting officer[209](index=209&type=chunk) - The signing date for the report is November 3, 2023[209](index=209&type=chunk)

World Acceptance Corporation (NASDAQ:WRLD) Q2 2024 Earnings Conference Call October 20, 2023 10:00 AM ET Company Participants Chad Prashad - President and Chief Executive Officer John Calmes - Executive Vice President, Chief Financial and Strategy Officer Conference Call Participants Vincent Caintic - Stephens Inc. John Rowan - Janney Montgomery Scott LLC Operator Good morning, and welcome to World Acceptance Corporation's Second Quarter 2024 Earnings Conference Call. This call is being recorded. At this ti ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________________________ Form 10-Q __________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT of 1934 For the transition period from ______________ to ______________ Commission File Number: 000-19599 WORLD ACCEPTANCE CORPO ...

World Acceptance Corporation (NASDAQ:WRLD) Q1 2024 Results Conference Call July 21, 2023 10:00 AM ET Company Participants Chad Prashad - President & Chief Executive Officer Johnny Calmes - Chief Financial & Strategy Officer Conference Call Participants John Rowan - Janney Vincent Caintic - Stephens Operator Good morning, and welcome to the World Acceptance Corporation's First Quarter 2024 Earnings Conference Call. This call is being recorded. At this time, all participants have been placed on listen-only mo ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________________________ Form 10-K __________________________________ ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _____________ Commission file number: 000-19599 WORLD ACCEPTANCE CORPORATION (Exact nam ...

World Acceptance Corporation (NASDAQ:WRLD) Q4 2023 Earnings Conference Call May 4, 2023 10:00 AM ET Company Participants Chad Prashad - President & Chief Executive Officer Johnny Calmes - Chief Financial & Strategy Officer Conference Call Participants Vincent Caintic - Stephens John Rowan - Janney Operator Good morning, and welcome to World Acceptance Corporation's Fourth Quarter 2023 Earnings Conference Call. This call is being recorded. And at this time, all participants have been placed on listen-only mo ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 __________________________________ Form 10-Q __________________________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT of 1934 For the transition period from ______________ to ______________ Commission File Number: 000-19599 WORLD ACCEPTANCE C ...