CPS(US:CPSS)2019-08-07 18:36Financial Performance - Total revenues for the three months ended June 30, 2019, were $86,325, a decrease of 13% compared to $99,362 for the same period in 2018[15] - Net income for the three months ended June 30, 2019, was $1,800, down 43% from $3,165 in the same period of 2018[17] - Net income for the six months ended June 30, 2019, was $3,539,000, a decrease of 43.8% compared to $6,312,000 for the same period in 2018[19] - Total revenues for the six months ended June 30, 2019 were $174.6 million, a decrease of $28.4 million, or 14.0%, from the prior year, primarily due to a decrease in interest income[141] - Interest income for the six months ended June 30, 2019 decreased by $27.6 million, or 14.0%, to $170.3 million from $197.9 million in the prior year[141] Operating Expenses - Total operating expenses were $83.6 million for the three months ended June 30, 2019, a decrease of $11.1 million, or 11.8%, compared to $94.7 million in the prior period[122] - Total operating expenses were $169.1 million for the six months ended June 30, 2019, a decrease of $24.6 million, or 12.7%, primarily due to a decrease in provision for credit losses[148] - Employee costs for the three months ended June 30, 2019, were $19,706, slightly down from $19,842 in the same period of 2018[15] - Employee costs decreased by $1.7 million or 4.2%, to $38.8 million during the six months ended June 30, 2019, representing 22.9% of total operating expenses[149] Interest and Financing - Interest income for the three months ended June 30, 2019 was $84.4 million, compared to $97.0 million for the same period in 2018, representing a decrease of approximately 12.5%[73] - Interest expense for the three months ended June 30, 2019 was $27.7 million, an increase of 10% from $25.2 million in the same period of 2018[73] - Interest expense for the six months ended June 30, 2019 increased by $5.7 million to $55.0 million, or 11.7%, representing 32.5% of total operating expenses[150] - The blended cost of funds for recent securitizations has generally increased, with a cost of 4.4% for the six months ended June 30, 2019, compared to 4.1% in the prior year[152] Credit Quality and Losses - The allowance for finance credit losses decreased to $32,664 as of June 30, 2019, from $67,376 as of December 31, 2018, indicating improved credit quality[14] - Provision for credit losses was $20.5 million for the three months ended June 30, 2019, a decrease of $15.0 million, or 42.3%, compared to the prior year, representing 24.5% of total operating expenses[136] - Provision for credit losses was $44.4 million for the six months ended June 30, 2019, a decrease of $31.6 million, or 41.5%, compared to the prior year, representing 26.3% of total operating expenses[161] Cash Flow and Investments - Net cash provided by operating activities increased to $112,418,000 from $101,295,000, representing an increase of 10.5% year-over-year[19] - Net cash used in investing activities was $(115,377,000), compared to $(93,069,000) in the prior year, indicating an increase in cash outflow of 24.0%[19] - Purchases of finance receivables were $494.6 million in the first six months of 2019, compared to $430.6 million in the same period of 2018, marking an increase of 14.9%[1] Debt and Equity - Total liabilities increased to $2,324,130 as of June 30, 2019, from $2,288,562 as of December 31, 2018[14] - Total shareholders' equity at the end of the period was $200,683,000, up from $189,622,000, reflecting an increase of 5.6%[21] - As of June 30, 2019, the company had outstanding debt of $195.1 million, a slight decrease from $195.4 million at December 31, 2018[70] Securitization and Asset Management - The company completed a securitization transaction on July 24, 2019, selling $243.5 million of asset-backed notes secured by $244.1 million in automobile receivables[68] - The company completed two securitizations aggregating $482.7 million of notes sold during the six-month period ended June 30, 2019[1] - The average balance of securitization trust debt increased by 2.3% to $2,175.9 million for the three months ended June 30, 2019[127] Delinquencies and Extensions - Total delinquencies amounted to 22,975 contracts, with a total value of $315,389 thousand, compared to 15,140 contracts valued at $200,339 thousand in the previous year, indicating a significant increase in delinquencies[166] - Average number of extensions granted per month decreased to 4,994 in June 2019 from 10,298 in June 2018, reflecting a reduction of approximately 51.5%[1] - The company considers extensions to be insignificant delays in payments rather than troubled debt restructurings, with specific criteria for granting extensions based on the obligor's situation[170] Forward-Looking Statements - Forward-looking statements may involve risks and uncertainties, including changes in economic conditions and competition[206] - The company does not undertake any obligation to publicly update forward-looking information[208]