Credit Acceptance(US:CACC)2025-04-30 20:05Financial Performance - Consolidated net income for Q1 2025 was $106.3 million, or $8.66 per diluted share, compared to $151.9 million, or $12.26 per diluted share in Q4 2024[2]. - Adjusted net income for Q1 2025 was $114.8 million, or $9.35 per diluted share, down from $126.0 million, or $10.17 per diluted share in Q4 2024[2]. - GAAP net income for the three months ended March 31, 2025, rose by 65.3% to $106.3 million, driven by a 12.3% increase in finance charges[27]. - Adjusted net income for the three months ended March 31, 2025, was $106.3 million, compared to $151.9 million for the previous quarter, reflecting a decrease of 30%[33]. - Adjusted net income for the same period was $114.8 million, down from $126.0 million in the prior quarter, a decline of 9.5%[37]. - Economic profit decreased by 31.3% to $35.3 million in Q1 2025, down from $51.4 million in Q1 2024[29]. - Economic profit for the quarter was $35.3 million, down from $51.3 million in the previous quarter, a decline of 31.1%[37]. - Basic net income per share rose to $8.79 in Q1 2025, compared to $5.15 in Q1 2024, representing an increase of 70.5%[62]. Revenue and Expenses - Adjusted revenue reached $571.1 million for the quarter, up from $565.9 million in the prior quarter, indicating a growth of 0.4%[33]. - Total revenue for Q1 2025 was $571.1 million, an increase of 12.4% compared to $508.0 million in Q1 2024[62]. - Finance charges increased to $526.7 million in Q1 2025 from $469.2 million in Q1 2024, reflecting a growth of 12.2%[62]. - Adjusted interest expense (after-tax) rose by 24.0% to $88.3 million in Q1 2025 from $71.2 million in Q1 2024[29]. - Interest expenses increased to $114.7 million in Q1 2025, up from $92.5 million in Q1 2024, marking a rise of 24.0%[62]. - Operating expenses grew by 7.5% year-over-year, impacting adjusted return on capital positively by 50 basis points[29]. Loan Portfolio and Credit Losses - The average balance of the loan portfolio increased by 11.0% year-over-year to $7.9 billion, the largest in company history[2]. - Consumer Loan assignment unit and dollar volumes declined by 10.1% and 15.5%, respectively, compared to Q1 2024[2]. - The provision for credit losses decreased by 13.0% ($24.1 million) due to a smaller decline in consumer loan performance and a decrease in new consumer loan assignments[27]. - Total provision for credit losses decreased to $161.9 million in Q1 2025 from $186.0 million in Q1 2024, a reduction of 12.9%[62]. - The GAAP provision for credit losses (after-tax) was $124.6 million, compared to $95.0 million in the previous quarter, indicating an increase of 31.6%[33]. Capital and Shareholder Equity - The average capital increased by 17.1% to $8,180.3 million for the three months ended March 31, 2025, compared to $6,985.3 million in 2024[27]. - Adjusted average capital increased by 18.3% to $8,882.6 million from $7,507.8 million year-over-year[29]. - The adjusted average capital was $8,882.6 million, compared to $8,633.3 million in the prior quarter, showing an increase of 2.9%[33]. - Shareholders' equity decreased to $1,710.9 million from $1,749.6 million, showing a decline of 2.2%[64]. - Paid-in capital increased to $351.7 million from $335.1 million, indicating a growth of 4.0%[64]. Dealer and Consumer Loans - The company enrolled 1,617 new dealers, bringing the total to 10,789 active dealers during the quarter[2]. - The percentage of consumer loans assigned as dealer loans decreased to 77.0% for the three months ended March 31, 2025, from 78.2% in the previous year[25]. - Consumer loan assignment volumes are influenced by overall demand and available capital, with a focus on maximizing economic profit[21]. - The average volume per active dealer decreased by 9.7% to 9.3 units for the three months ended March 31, 2025[23]. Cash and Assets - As of March 31, 2025, the company maintained over $2.2 billion in unrestricted cash and cash equivalents[2]. - Total assets increased to $9,258.0 million as of March 31, 2025, up from $8,854.6 million on December 31, 2024, representing a growth of 4.5%[64]. - Cash and cash equivalents increased to $528.8 million, up from $343.7 million, marking a significant increase of 53.8%[64]. - Loans receivable, net rose to $7,978.2 million, compared to $7,850.3 million, indicating an increase of 1.6%[64]. Debt and Financing - The company redeemed $250.0 million of 2023 senior notes on March 15, 2020, using proceeds from the 2024 senior notes[44]. - The company plans to issue 9.250% senior notes due 2028 in December 2023 and 6.625% senior notes due 2030 in February 2025[49].