Financial Data and Key Metrics Changes - FlexShopper reported a total revenue increase of over 29% year-over-year in Q2 2024 [5] - Gross profit expanded by 90%, resulting in a gross margin of 50% compared to 34% in Q2 2023 [17] - Adjusted EBITDA rose from approximately 4.9 million in Q2 2024, marking the highest second quarter adjusted EBITDA level in two years [6][19] Business Line Data and Key Metrics Changes - Retail revenue increased from 1.4 million in Q2 2024, showing consistent growth in monthly retail revenue [9] - Total lease funding approvals doubled year-over-year, reaching 37.0 million in Q2 2023 [18] - The provision for doubtful accounts as a percentage of gross lease billings improved to 22.5% in Q2 2024 from 33.4% in Q2 2023, indicating better asset quality [15] Market Data and Key Metrics Changes - The company added 150 retail storefronts by the end of Q2 2024, with an expectation of 500 additional storefronts in the second half of 2024 [11][32] - The retail lending environment remains challenging for nonprime consumers, but the company is enhancing risk-based pricing to optimize consumer engagement [13] Company Strategy and Development Direction - FlexShopper is focused on expanding its financing options and enhancing its digital marketplace, which includes traditional lease-to-own offerings and unsecured consumer loan products [6][7] - The company aims to increase customer conversion rates, which have been under 1% of unique website visitors, through various strategies including expanding payment solutions [12] - A significant opportunity exists to grow the online retail strategy, with plans to add more product categories and SKUs to the FlexShopper site [10][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth strategies and the ability to capture market share as other lenders tighten their standards [13][14] - The company remains vigilant regarding potential economic slowdowns but sees continued customer interest and stable consumer prices [20] Other Important Information - FlexShopper has made significant investments in technology to enhance underwriting, collections, and account servicing capabilities [8] - The company does not take inventory of products offered on its websites, relying on strategic relationships with distributors and manufacturers for drop-shipping [10] Q&A Session Summary Question: Update on total lease funding approvals metric - Management explained the shift to total lease funding approvals to clarify the number of approvals being issued, which may not be used immediately [22] Question: Status of microsites rollout - The first microsite focusing on gaming and electronics is live, with plans to launch two more by the end of the year [23] Question: Maturity of new retail locations - New locations typically take a few days to set up, with training for local operators being crucial for acceptance [24][25] Question: Customer engagement with lease funding approvals - Management noted seasonality in customer engagement, with higher take rates for essential items compared to consumer electronics [30] Question: Total retail locations after new additions - The total number of retail locations is expected to be just short of 5,000 after the addition of 500 new locations [32]
FlexShopper(FPAY) - 2024 Q2 - Earnings Call Transcript