Financial Performance - Total revenues for the three months ended March 31, 2021, were $63,112, a decrease of 10.5% from $70,767 in the same period of 2020[17]. - Net income for the three months ended March 31, 2021, was $5,164, down 52.1% from $10,792 in the same period of 2020[19]. - Basic earnings per share for the three months ended March 31, 2021, were $0.23, compared to $0.48 for the same period in 2020, a decrease of 52.1%[17]. - Other income for the three-month period ending March 31, 2021 was $1.436 million, a decrease of 27.5% compared to $1.981 million for the same period in 2020[37]. - Interest income for the three months ended March 31, 2021, was $61.7 million, compared to $68.8 million for the same period in 2020[84]. - Interest expense for the three months ended March 31, 2021, was $20.9 million, down from $27.0 million in the same period in 2020[84]. - The company reported charge-offs of $12.1 million for the three-month period ended March 31, 2021, compared to $34.2 million for the same period in 2020, showing an improvement in credit quality[68]. Assets and Liabilities - Total assets as of March 31, 2021, were $2,095,807, a decrease of 2.3% from $2,145,895 as of December 31, 2020[13]. - Finance receivables, net, decreased to $337,612 as of March 31, 2021, from $411,343 as of December 31, 2020, representing a decline of 17.9%[13]. - The total outstanding securitization trust debt was $1,949.1 million, with an initial principal of $5,391.0 million[71]. - The company had a short-term funding capacity of $200 million as of March 31, 2021, down from $300 million as of December 31, 2020[81]. - Total outstanding debt as of March 31, 2021, was approximately $1,907.0 million, consisting of $1,791.6 million in securitization trust debt and $71.1 million in warehouse lines of credit[190]. Cash Flow - The company provided $65,350 in net cash from operating activities for the three months ended March 31, 2021, compared to $64,054 in the same period of 2020[23]. - Net cash provided by operating activities for Q1 2021 was $65.4 million, an increase of $1.3 million compared to $64.1 million in Q1 2020[180]. - Net cash used in financing activities for Q1 2021 was $64.8 million, significantly higher than $1.7 million in the prior year period, indicating increased reliance on securitization trust debt[183]. Operating Expenses - Operating expenses for the three months ended March 31, 2021, totaled $55,168, down 18.5% from $67,655 in the same period of 2020[17]. - Total operating expenses decreased by $12.5 million, or 18.5%, to $55.2 million for the three months ended March 31, 2021, primarily due to decreases in interest expense, provisions for credit losses, and employee costs[135]. - Employee costs decreased by $1.7 million, or 7.7%, to $20.2 million, representing 36.5% of total operating expenses, compared to 32.3% in the prior year[136]. Credit Quality and Delinquencies - The allowance for credit losses increased by $127.0 million due to the adoption of the Current Expected Credit Loss (CECL) model, reflecting a significant adjustment in the credit loss estimation methodology[66]. - The delinquency status shows that current receivables were $360.4 million, down from $406.7 million, while receivables 31-60 days delinquent decreased from $56.6 million to $35.5 million[58]. - Total delinquencies as a percentage of the gross servicing portfolio increased to 8.1% as of March 31, 2021, compared to 7.8% in December 2020[161]. Securitization and Debt - The company completed a securitization transaction on April 28, 2021, selling $240.0 million of asset-backed notes secured by $240.0 million in automobile receivables[79]. - The company issued $230,545 from securitization trust debt during the three months ended March 31, 2021[23]. - The average balance of securitization trust debt decreased to $1,876.8 million for the three months ended March 31, 2021, compared to $2,186.8 million in the prior year[141]. Legal and Regulatory Matters - The company has been involved in various legal proceedings related to its consumer finance activities, which may impact future financial results[52]. - The ongoing COVID-19 pandemic has necessitated adjustments in the company's fair value measurements for finance receivables, reflecting potential economic impacts[53]. Future Outlook - The company anticipates that future cash flows and earnings will be influenced by economic conditions, credit loss provisions, and the market for used vehicles[192]. - The company has a risk of increased delinquencies and losses on retail installment contracts, which could adversely affect its financial condition[202].
CPS(CPSS) - 2021 Q1 - Quarterly Report