World Acceptance (US:WRLD)2022-08-05 20:06Financial Performance - Total revenues for the three months ended June 30, 2022, increased to $157.59 million, up 21.5% from $129.66 million in the same period of 2021[17] - Net loss for the three months ended June 30, 2022, was $8.80 million, resulting in a loss per share of $1.53, compared to a net income of $15.77 million and earnings per share of $2.56 in the same period of 2021[17] - Interest and fee income for the three months ended June 30, 2022, was $130.21 million, an increase of 19.3% from $109.17 million in the same period of 2021[17] - Net income for the three months ended June 30, 2022, was a loss of $8.8 million, compared to a profit of $15.8 million in the same period of 2021[23] - Operating income (loss) decreased by $27.1 million, or 104.1%, compared to the same period of the prior fiscal year[124] Credit Losses and Loan Performance - Provision for credit losses rose significantly to $85.82 million, compared to $30.27 million in the prior year, reflecting a 184.5% increase[17] - The provision for credit losses significantly increased to $85.8 million from $30.3 million year-over-year, indicating a rise of approximately 183%[23] - Net charge-offs for Q2 2022 were $64.41 million, significantly higher than $24.14 million in Q2 2021, indicating a rise in loan defaults[52] - The allowance for credit losses increased from $91.72 million in Q2 2021 to $134.24 million in Q2 2022, reflecting a provision for credit losses of $85.82 million in 2022 compared to $30.27 million in 2021[52] - The total gross loans receivable as of June 30, 2022, amounted to $1.64 billion, with a total past due amount of $183.17 million, representing 11.2% of total loans[52] Assets and Liabilities - Total assets reached $1.28 billion as of June 30, 2022, up from $1.22 billion as of March 31, 2022, indicating a 4.7% increase[14] - Total liabilities amounted to $924.95 million as of June 30, 2022, up from $845.27 million as of March 31, 2022, representing a 9.4% increase[14] - Senior notes payable increased to $481.39 million as of June 30, 2022, compared to $396.97 million as of March 31, 2022, reflecting a 21.2% rise[14] - Shareholders' equity decreased to $354.13 million as of June 30, 2022, down from $373.02 million as of March 31, 2022, a decline of 5.1%[14] Cash Flow and Investments - Net cash provided by operating activities increased to $58.2 million, up from $49.0 million year-over-year, reflecting a growth of approximately 18.5%[23] - Cash used in investing activities totaled $134.3 million, compared to $99.5 million in the prior year, reflecting an increase of about 35.0%[23] - Net cash provided by financing activities was $70.2 million, up from $43.1 million in the previous year, indicating a growth of approximately 62.9%[23] Loan Demand and Trends - The company’s highest loan demand typically occurs from October through December, indicating seasonal trends in loan volume[30] - The company has experienced significant seasonal fluctuations in operating results, with Q3 generally being lower and Q4 higher than other quarters[30] Debt and Covenants - The Company had total future debt payments of $781.4 million as of June 30, 2022[107] - The Company was in compliance with its debt covenants at June 30, 2022, and does not believe these covenants will materially limit its business and expansion strategy[104] - The Company has a minimum consolidated net worth requirement of $325.0 million as part of its debt covenants[102] Stock and Compensation - The weighted-average fair value at the grant date for stock options issued during the three months ended June 30, 2022, was $80.87, compared to $84.83 in 2021[77] - Compensation expense related to restricted stock was $3.0 million for the three months ended June 30, 2022, compared to $3.2 million for the same period in 2021[82] Miscellaneous - The company completed the sale of its last held-for-sale building, recording a loss of $39,000[28] - The company operates as a small-loan consumer finance company, providing short-term and medium-term loans to individuals with limited access to credit[29] - The company is currently evaluating the impact of the recently issued ASU 2022-02 on its consolidated financial statements[35]