America's Car-Mart Reports Third Quarter Fiscal Year 2025 Results

Core Insights - America's Car-Mart, Inc. reported a strong financial performance for the third quarter of fiscal year 2025, with total revenue increasing by 8.7% year-over-year to $325.7 million, driven by higher sales volumes and interest income [5][6][19]. Financial Performance - Total revenue reached$325.7 million, reflecting an 8.7% increase compared to the same quarter last year [5][19]. - Sales volumes increased by 13.2%, totaling 13,198 units sold, compared to 11,664 units in the prior year [7][19]. - Interest income rose by $3.0 million, or 5.1$3.2 million, a significant recovery from a loss of $8.5 million in the same quarter last year, resulting in diluted earnings per share of$0.37 compared to a loss per share of $1.34 [5][31]. Operational Metrics - The average retail sales price of vehicles sold was$19,275, a slight decrease of 0.9% from the previous year [19]. - The allowance for credit losses improved to 24.31%, down from 24.72% sequentially, indicating better credit performance [9][19]. - Net charge-offs as a percentage of average finance receivables improved to 6.1% from 6.8% in the prior year, reflecting a decrease in both frequency and severity of losses [8][19]. Financing and Capital Structure - The company completed a $200 million term securitization transaction, achieving a 95 basis point improvement in the weighted average life adjusted coupon compared to the previous transaction [5][14]. - An amended asset-based lending revolving credit facility of$350 million was established, extending the maturity to March 2027 [5][15]. - Debt to finance receivables ratio stood at 53.5%, while the ratio of debt, net of total cash, to finance receivables was 45.0% [13][38]. Customer and Market Insights - The company ended the quarter with a higher inventory level to support seasonal sales trends associated with spring and tax refund season [7]. - Active customer count increased to 103,663, up from 102,175 in the previous year, indicating growth in customer engagement [20]. Strategic Initiatives - The company is focused on enhancing financial flexibility, operational capabilities, and technology, which has contributed to improved performance metrics [3]. - Continued investment in leadership and technology is expected to support future growth and customer service enhancements [3].