Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 03, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-38315 | |
Entity Registrant Name | CURO GROUP HOLDINGS CORP. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 90-0934597 | |
Entity Address, Address Line One | 3527 North Ridge Road | |
Entity Address, City or Town | Wichita | |
Entity Address, State or Province | KS | |
Entity Address, Postal Zip Code | 67205 | |
City Area Code | 316 | |
Local Phone Number | 772-3801 | |
Title of 12(b) Security | Common stock, $0.001 par value per share | |
Trading Symbol | CURO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 40,885,113 | |
Entity Central Index Key | 0001711291 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 269,342 | $ 75,242 |
Restricted cash (includes restricted cash of consolidated VIEs of $39,248 and $17,427 as of June 30, 2020 and December 31, 2019, respectively) | 63,274 | 34,779 |
Gross loans receivable (includes loans of consolidated VIEs of $290,828 and $244,492 as of June 30, 2020 and December 31, 2019, respectively) | 456,512 | 665,828 |
Less: allowance for loan losses (includes allowance for losses of consolidated VIEs of $47,988 and $24,425 as of June 30, 2020 and December 31, 2019, respectively) | (76,455) | (106,835) |
Loans receivable, net | 380,057 | 558,993 |
Income taxes receivable | 18,805 | 11,426 |
Prepaid expenses and other | 32,860 | 35,890 |
Property and equipment, net | 64,259 | 70,811 |
Right of use asset - operating leases | 111,860 | 117,453 |
Deferred tax assets | 0 | 5,055 |
Goodwill | 133,977 | 120,609 |
Other intangibles, net | 35,707 | 33,927 |
Other assets | 17,018 | 17,710 |
Total Assets | 1,127,159 | 1,081,895 |
Liabilities | ||
Accounts payable and accrued liabilities (includes accounts payable and accrued liabilities of consolidated VIEs of $20,567 and $13,462 as of June 30, 2020 and December 31, 2019, respectively) | 63,960 | 60,083 |
Deferred revenue | 4,974 | 10,170 |
Lease liability - operating leases | 119,767 | 124,999 |
Accrued interest (includes accrued interest of consolidated VIEs of $1,030 and $871 as of June 30, 2020 and December 31, 2019, respectively) | 20,005 | 19,847 |
Liability for losses on CSO lender-owned consumer loans | 5,164 | 10,623 |
Debt (includes debt and issuance costs of consolidated VIEs of $126,315 and $5,630 as of June 30, 2020 and $115,243 and $3,022 as of December 31, 2019, respectively) | 799,828 | 790,544 |
Other long-term liabilities | 11,461 | 10,664 |
Deferred tax liabilities | 9,058 | 4,452 |
Total Liabilities | 1,034,217 | 1,031,382 |
Commitments and contingencies (Note 13) | ||
Stockholders' Equity | ||
Preferred stock - $0.001 par value, 25,000,000 shares authorized; no shares were issued | 0 | 0 |
Common stock - $0.001 par value; 225,000,000 shares authorized; 47,039,848 and 46,770,765 shares issued; and 40,884,545 and 41,156,224 shares outstanding at the respective period ends | 9 | 9 |
Treasury stock, at cost - 6,155,303 and 5,614,541 shares as of the respective period ends | (77,852) | (72,343) |
Paid-in capital | 74,079 | 68,087 |
Retained earnings | 147,301 | 93,423 |
Accumulated other comprehensive loss | (50,595) | (38,663) |
Total Stockholders' Equity | 92,942 | 50,513 |
Total Liabilities and Stockholders' Equity | $ 1,127,159 | $ 1,081,895 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Restricted cash | $ 63,274 | $ 34,779 |
Total gross loans receivable | 456,512 | 665,828 |
Less: allowance for losses | 76,455 | 106,835 |
Accounts payable and accrued liabilities | 63,960 | 60,083 |
Accrued interest | $ 20,005 | $ 19,847 |
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 25,000,000 | 25,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Class A common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Class A common stock, authorized (in shares) | 225,000,000 | 225,000,000 |
Class A common stock, issued (in shares) | 47,039,848 | 46,770,765 |
Class A common stock, outstanding (in shares) | 40,884,545 | 41,156,224 |
Treasury stock (in shares) | 6,155,303 | 5,614,541 |
Variable Interest Entity | ||
Restricted cash | $ 39,248 | $ 17,427 |
Total gross loans receivable | 290,828 | 244,492 |
Less: allowance for losses | 47,988 | 24,425 |
Accounts payable and accrued liabilities | 20,567 | 13,462 |
Accrued interest | 1,030 | 871 |
Debt | 126,315 | 115,243 |
Issuance costs | $ 5,630 | $ 3,022 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement [Abstract] | ||||
Revenue | $ 182,509 | $ 264,300 | $ 463,315 | $ 542,239 |
Provision for losses | 50,693 | 112,010 | 164,229 | 214,395 |
Net revenue | 131,816 | 152,290 | 299,086 | 327,844 |
Cost of providing services | ||||
Salaries and benefits | 24,723 | 26,086 | 50,730 | 54,787 |
Occupancy | 13,043 | 13,932 | 27,059 | 28,169 |
Office | 3,800 | 5,457 | 9,474 | 10,570 |
Other costs of providing services | 8,001 | 12,854 | 17,656 | 27,074 |
Advertising | 5,750 | 12,780 | 17,969 | 20,566 |
Total cost of providing services | 55,317 | 71,109 | 122,888 | 141,166 |
Gross margin | 76,499 | 81,181 | 176,198 | 186,678 |
Operating expense | ||||
Corporate, district and other expenses | 36,781 | 35,290 | 79,588 | 84,378 |
Interest expense | 18,311 | 17,023 | 35,635 | 34,713 |
(Gain) loss from equity method investment | (741) | 3,748 | 877 | 3,748 |
Total operating expense | 54,351 | 56,061 | 116,100 | 122,839 |
Income from continuing operations before income taxes | 22,148 | 25,120 | 60,098 | 63,839 |
Provision for income taxes | 1,068 | 7,453 | 3,005 | 17,499 |
Net income from continuing operations | 21,080 | 17,667 | 57,093 | 46,340 |
Net income (loss) from discontinued operations, before income tax | 1,324 | 0 | 1,714 | (39,048) |
Income tax expense (benefit) related to disposition | 331 | 834 | 429 | (46,589) |
Net income (loss) from discontinued operations | 993 | (834) | 1,285 | 7,541 |
Net income | $ 22,073 | $ 16,833 | $ 58,378 | $ 53,881 |
Basic earnings (loss) per share: | ||||
Continuing operations (in dollars per share) | $ 0.52 | $ 0.38 | $ 1.40 | $ 1 |
Discontinued operations (in dollars per share) | 0.02 | (0.02) | 0.03 | 0.16 |
Basic earnings per share (in dollars per share) | 0.54 | 0.36 | 1.43 | 1.16 |
Diluted earnings (loss) per share: | ||||
Continuing operations (in dollars per share) | 0.51 | 0.38 | 1.37 | 0.98 |
Discontinued operations (in dollars per share) | 0.02 | (0.02) | 0.03 | 0.16 |
Diluted earnings per share (in dollars per share) | $ 0.53 | $ 0.36 | $ 1.40 | $ 1.14 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 40,810 | 46,451 | 40,814 | 46,438 |
Diluted (in shares) | 41,545 | 47,107 | 41,686 | 47,335 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 22,073 | $ 16,833 | $ 58,378 | $ 53,881 |
Other comprehensive (loss) income: | ||||
Foreign currency translation adjustment, net of $0 tax in both periods | 10,261 | 3,635 | (11,932) | 20,330 |
Other comprehensive (loss) income | 10,261 | 3,635 | (11,932) | 20,330 |
Comprehensive income | $ 32,334 | $ 20,468 | $ 46,446 | $ 74,211 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Foreign currency translation adjustment, tax effect | $ 0 | $ 0 | $ 0 | $ 0 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | ||
Cash flows from operating activities | |||
Net income from continuing operations | $ 57,093 | $ 46,340 | |
Adjustments to reconcile net income to net cash provided by continuing operating activities: | |||
Depreciation and amortization | 8,954 | 9,571 | |
Provision for losses | 164,229 | 214,395 | |
Amortization of debt issuance costs and bond discount | 1,600 | 1,568 | |
Deferred income tax (benefit) expense | 9,861 | (3,596) | |
Loss on disposal of property and equipment | 116 | 1,834 | |
Loss from equity method investment | 877 | 3,748 | |
Share-based compensation | 6,504 | 4,816 | |
Changes in operating assets and liabilities: | |||
Accrued interest on loans receivable | 28,654 | (1,171) | |
Prepaid expenses and other assets | 3,286 | 16,344 | |
Other assets | 99 | (6,893) | |
Accounts payable and accrued liabilities | 965 | 9,527 | |
Deferred revenue | (5,040) | (915) | |
Income taxes payable | 0 | 25,123 | |
Income taxes receivable | (7,413) | (8,253) | |
Accrued interest | 200 | (1,247) | |
Other liabilities | 815 | 1,128 | |
Net cash provided by continuing operating activities | 270,800 | 312,319 | |
Net cash provided by (used in) discontinued operating activities | 1,714 | (504) | |
Net cash provided by operating activities | 272,514 | 311,815 | |
Cash flows from investing activities | |||
Purchase of property and equipment | (4,724) | (6,164) | |
Loans receivable originated or acquired | (648,044) | (879,081) | |
Loans receivable repaid | 616,223 | 661,882 | |
Investments in Katapult | 0 | (4,368) | |
Acquisition of Ad Astra, net of acquiree's cash received | (14,418) | 0 | |
Net cash used in continuing investing activities | (50,963) | (227,731) | |
Net cash used in discontinued investing activities | 0 | (14,213) | |
Net cash used in investing activities | (50,963) | (241,944) | |
Cash flows from financing activities | |||
Debt issuance costs paid | (3,531) | (198) | |
Payments on subordinated stockholder debt | 0 | (2,245) | |
Proceeds from exercise of stock options | 126 | 27 | |
Payments to net share settle restricted stock units vesting | (638) | 0 | |
Repurchase of common stock | (5,908) | (1,762) | |
Dividends paid to stockholders | (4,500) | 0 | |
Net cash provided by (used in) financing activities | [1] | 2,123 | (45,180) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (1,079) | 1,461 | |
Net increase in cash, cash equivalents and restricted cash | 222,595 | 26,152 | |
Cash, cash equivalents and restricted cash at beginning of period | 110,021 | 99,857 | |
Cash, cash equivalents and restricted cash at end of period | 332,616 | 126,009 | |
Revolving Credit Facility | Non-Recourse U.S. SPV facility | |||
Cash flows from financing activities | |||
Proceeds from credit facilities | 35,206 | 0 | |
Revolving Credit Facility | Non-Recourse Canada SPV Facility | |||
Cash flows from financing activities | |||
Proceeds from credit facilities | 23,180 | 3,750 | |
Payments on credit facilities | (41,812) | (24,752) | |
Revolving Credit Facility | Senior Revolver | Line of Credit | |||
Cash flows from financing activities | |||
Proceeds from credit facilities | 69,778 | 68,002 | |
Payments on credit facilities | $ (69,778) | $ (88,002) | |
[1] | (1) Financing activities were not impacted by discontinued operations |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Cash and cash equivalents | $ 269,342 | $ 75,242 | $ 92,297 | |
Restricted cash | 63,274 | 34,779 | 33,712 | |
Total cash, cash equivalents and restricted cash used in the Statement of Cash Flows | 332,616 | 110,021 | 126,009 | $ 99,857 |
Variable Interest Entity | ||||
Restricted cash | $ 39,248 | $ 17,427 | $ 14,819 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS Nature of Operations and Basis of Presentation The terms “CURO" and the “Company” refer to CURO Group Holdings Corp. and its wholly-owned subsidiaries as a consolidated entity, except where otherwise stated. CURO is a growth-oriented, technology-enabled, highly-diversified consumer finance company serving a wide range of underbanked consumers in the U.S., Canada and, through February 25, 2019, the U.K. The Company has prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with US GAAP, and with the accounting policies described in its 2019 Form 10-K. Interim results of operations are not necessarily indicative of results that might be expected for future interim periods or for the year ending December 31, 2020. Certain information and note disclosures normally included in annual financial statements prepared in accordance with US GAAP have been condensed or omitted, although the Company believes that the disclosures are adequate to enable a reasonable understanding of the information presented. Additionally, the Company qualifies as an SRC as defined by the SEC, which allows registrants to report information under scaled disclosure requirements. SRC status is determined on an annual basis as of the last business day of the most recently completed second fiscal quarter. Under these rules, the Company met the definition of an SRC as of June 30, 2020, and it will reevaluate its status as of June 30, 2021. The unaudited Condensed Consolidated Financial Statements and the accompanying notes reflect all adjustments (consisting only of adjustments of a normal and recurring nature) which are, in the opinion of management, necessary to present fairly the Company's results of operations, financial position and cash flows for the periods presented. COVID-19 A novel strain of coronavirus, COVID-19, surfaced in late 2019 and has subsequently spread worldwide, including to the U.S. and Canada. On March 11, 2020, the World Health Organization categorized COVID-19 as a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. Macroeconomic conditions, in general, and the Company's operations have been significantly affected by the COVID-19 pandemic and there are no reliable estimates of how long the pandemic will last or the scope or magnitude of its near-term or long-term impact. Resurgences of the pandemic in various states in which the Company operates also adds uncertainty as jurisdictions establish protocols to lessen the burden of these cases, as described further below. Refer to Note 3 , "Loans Receivable and Reve nue" for an explanation of the effect of the pandemic on the Company's loans receivable and the allowance for loan losses as of June 30, 2020. In response to the pandemic, various governmental bodies have issued decrees prohibiting certain businesses from continuing to operate and certain classes of workers from reporting to work. However, CURO's operations have been designated as essential financial services by federal guidelines and local regulations. As a provider of an essential service, the Company remains focused on protecting the health and well being of its employees, customers and the communities in which it operates while assuring the continuity of its business operations. While CURO continues serving its customers through both store and online channels, store hours are reduced, enhanced cleaning protocols for all facilities are in place, and social distancing guidelines are in effect to aid in combating the spread of the pandemic. On March 27, 2020, the U.S. government enacted the CARES Act, which includes modifications to the limitation on business interest expense and net operating loss provisions, and provides a payment delay of employer payroll taxes incurred subsequent to the date of enactment. The Company expects to delay payment of employer payroll taxes otherwise due in 2020 with 50% due by December 31, 2021 and the remaining 50% by December 31, 2022. The CARES Act also included two provisions that directly impacted the demand for the Company's products as well as its customers’ ability to make payments on their existing loans. The CARES Act included one-time Economic Impact Payments to American households of up to $1,200 per adult for individuals whose income was less than $99,000 (or $198,000 for tax joint filers) and $500 per child under 17 years old, up to $3,400 for a family of four if certain eligibility criteria were met. The CARES Act also provided Unemployment benefit expansion, including (i) an additional $600 federal stimulus payment automatically added to each week of state benefits received between March 29 and July 25, 2020; (ii) expanded Pandemic Unemployment Assistance coverage to self-employed workers, independent contractors, people with limited employment history and people who have used all of their regular unemployment insurance benefits; and (iii) Pandemic Emergency Unemployment Compensation, which extends unemployment insurance benefits from 26 weeks to 39 weeks within a 12-month benefit year. On March 18, 2020, the Canadian government announced a set of pandemic measures as part of the Government of Canada’s COVID-19 Economic Response Plan. This plan included several provisions that directly impacted the demand for the Company's products as well as its customers’ ability to make payments on their existing loans, including (i) the Canada Emergency Response Benefit which provides a $2,000 benefit every four weeks for 24 weeks to eligible workers who become unemployed or under-employed as a result of COVID-19; (ii) a $300 per child Canada Child Benefit paid on May 20, 2020; (iii) a one-time special payment through Canada’s Goods and Services Tax credit for low and modest-income families that averages $400 for individuals and $600 for couples; and iv) temporary wage increases for low-income essential workers funded at the federal level but disbursed at the provincial level. Refer to Note 7, "Income Taxes" for the CARES Act impact to the Company's provision for income taxes. The effect of the COVID-19 pandemic will not be fully reflected in the Company's results of operations and overall financial performance until future periods. The extent of the impact of COVID-19 on the Company's business is highly uncertain and difficult to predict, as information is rapidly evolving with respect to the duration and severity of the pandemic. Principles of Consolidation The unaudited Condensed Consolidated Financial Statements include the accounts of CURO and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. Ad Astra Acquisition On January 3, 2020, the Company acquired 100% of the outstanding stock of Ad Astra, a related party, for total consideration of $14.4 million, net of cash received. Prior to the acquisition, Ad Astra was the Company's exclusive provider of third-party collection services for owned and managed loans in the U.S. that are in later-stage delinquency. Ad Astra, now a wholly-owned subsidiary, is included in the unaudited Condensed Consolidated Financial Statements. Prior to the acquisition, all costs related to Ad Astra were included in "Other costs of providing services." Following the acquisition, operating costs for Ad Astra are included within "Corporate, district and other expenses," consistent with presentation of other internal collection costs. See Note 17, "Acquisition" for further information. U.K. Segment Placed into Administration On February 25, 2019, the Company placed its U.K. segment into administration, which resulted in the treatment of the U.K. segment as discontinued operations for all periods presented. Throughout this Form 10-Q, current and prior period financial information is presented on a continuing operations basis, excluding the results and positions of the U.K. segment. See Note 15, "Discontinued Operations" for additional information. Equity Investment in Unconsolidated Entity The Company holds an equity investment in Katapult, a private lease-to-own platform for online, brick and mortar and omni-channel retailers. Katapult provides the retailers' customers with payment options in store or via the Katapult link on a retailer's website. As of June 30, 2020, the Company owned 42.5% of Katapult. The Company records the equity method investment in "Other assets" on the unaudited Condensed Consolidated Balance Sheets. See Note 8, "Fair Value Measurements" for additional detail on Katapult's fair value considerations. Use of Estimates The preparation of the unaudited Condensed Consolidated Financial Statements in conformity with US GAAP requires management to make estimates and assumptions, such as those impacted by COVID-19, that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the periods presented. Some of the significant estimates that the Company made in the accompanying unaudited Condensed Consolidated Financial Statements include allowances for loan losses, certain assumptions related to equity investments, goodwill and intangibles, accruals related to self-insurance, CSO liability for losses and estimated tax liabilities. Actual results may differ from those estimates. Troubled Debt Restructuring In certain circumstances, the Company modifies the terms of its loans receivable for borrowers. Under US GAAP, a modification of loans receivable terms is considered a TDR if the borrower is experiencing financial difficulty and the Company grants a concession to the borrower it would not have otherwise granted. In light of the COVID-19 pandemic, the Company established an enhanced Customer Care Program, which enables its team members to provide relief to customers in various ways, ranging from due date changes, interest or fee forgiveness, payment waivers or extended payment plans, depending on a customer’s individual circumstances. The Company modifies loans only if it believes the customer has the ability to pay under the restructured terms. The Company continues to accrue and collect interest on these loans in accordance with the restructured terms. The Company records its allowance for loan losses related to TDRs by discounting the estimated cash flows associated with the respective TDR at the effective interest rate immediately after the loan modification and records any difference between the discounted cash flows and the carrying value as an allowance adjustment. A loan that has been classified as a TDR remains so until the loan is paid off or charged off. A TDR is charged off consistent with the Company's policies for the related loan product. For additional information on the Company's loss recognition policy, see the Company's 2019 Form 10-K. Refer to Note 3 , " Loans Receivable and Revenue " for further information on TDRs as of June 30, 2020. Goodwill The annual impairment review for goodwill, performed as of October 1, consists of performing a qualitative assessment to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount as a basis for determining whether or not further testing is required. The Company may elect to bypass the qualitative assessment and proceed directly to the two-step process, for any reporting unit, in any period. The Company can resume the qualitative assessment for any reporting unit in any subsequent period. If the Company determines, on the basis of qualitative factors, that it is more likely than not that the fair value of the reporting unit is less than the carrying amount, the Company will then apply a two-step process of (i) determining the fair value of the reporting unit and (ii) comparing it to the carrying value of the net assets allocated to the reporting unit. When performing the two-step process, if the fair value of the reporting unit exceeds its carrying value, no further analysis or write-down of goodwill is required. In the event the estimated fair value of a reporting unit is less than the carrying value, the Company would recognize an impairment loss equal to such excess, which could significantly and adversely impact reported results of operations and stockholders’ equity. During the fourth quarter of 2019, the Company performed a quantitative assessment for the U.S. and Canada reporting units. Management concluded that the estimated fair values of these two reporting units were greater than their respective carrying values. In the second quarter of 2020, the Company performed an interim qualitative assessment of goodwill on both reporting units to consider whether current events or circumstances, attributable to uncertainty caused by COVID-19, resulted in a more-likely-than-not determination that the fair values of the reporting units fell below their respective carrying values. The Company did not record an impairment loss during the six months ended June 30, 2020 as a result of its interim qualitative assessment of either reporting unit. Refer to Note 16, "Goodwill" for further information. Recently Adopted Accounting Pronouncements ASU 2018-15 In August 2018, the FASB issued ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (“ASU 2018-15”). ASU 2018-15 requires implementation costs incurred by customers in cloud computing arrangements to be deferred over the non-cancellable term of the cloud computing arrangements plus any optional renewal periods (i) that are reasonably certain to be exercised by the customer or (ii) for which exercise of the renewal option is controlled by the cloud service provider. The Company adopted ASU 2018-15 on a prospective basis as of January 1, 2020. The adoption of ASU 2018-15 did not have a material impact on the unaudited Condensed Consolidated Financial Statements. ASU 2018-13 In August 2018, the FASB issued ASU 2018-13, Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which amends ASC 820, Fair Value Measurement . ASU 2018-13 modifies the disclosure requirements for fair value measurements by removing, modifying or adding certain disclosures. The Company adopted ASU 2018-13 as of January 1, 2020, which did not have a material impact on the unaudited Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” and subsequent amendments to the guidance: ASU 2018-19 in November 2018, ASU 2019-04 in April 2019, ASU 2019-05 in May 2019, ASU 2019-10 and 11 in November 2019, and ASU 2020-02 in February 2020. The amended standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace the current “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For available-for-sale debt securities, entities will be required to record allowances rather than reduce the carrying amount, as they currently do under the other-than-temporary impairment model. The standard also simplifies the accounting model for purchased credit-impaired debt securities and loans. The amendment will affect loans, debt securities, trade receivables, net investments in leases, off-balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2019-04 clarifies that equity instruments without readily determinable fair values for which an entity has elected the measurement alternative should be remeasured to fair value as of the date that an observable transaction occurred. ASU 2019-05 provides an option to irrevocably elect to measure certain individual financial assets at fair value instead of amortized cost. ASU 2019-10 amends the mandatory effective date for ASU 2016-13. The amendments are effective for fiscal years beginning after December 15, 2022 for entities that qualify as an SRC, for which the Company currently qualifies. ASU 2019-11 provides clarity and improves the codification to ASU 2016-13. The amendments should be applied on either a prospective transition or modified-retrospective approach depending on the subtopic. As issued, ASU 2016-13 is effective for annual periods beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Company is evaluating its alternatives with respect to the available accounting methods under ASU 2016-13, including the fair value option. If the fair value option is not utilized, adoption of ASU 2016-13 will increase the allowance for credit losses, with a resulting negative adjustment to retained earnings on the date of adoption. The Company deferred the adoption of ASU 2016-13 as permitted under ASU 2019-10. The Company is currently assessing the impact that adoption of ASU 2016-13 will have on its Consolidated Financial Statements. ASU 2020-01 In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (ASU 2020-01). ASU 2020-01 clarifies the interaction of the accounting for equity securities under Topic 321, the accounting for equity method investments in Topic 323, and the accounting for certain forward contracts and purchased options in Topic 815. ASU 2020-01 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company is currently assessing the impact the adoption of ASU 2020-01 will have on its Consolidated Financial Statements. ASU 2020-04 In March 2020, the FASB issued ASU 2020-04, “ Reference Rate Reform - Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ” This ASU provides temporary optional expedients and exceptions to US GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates, such as the Secured Overnight Financing Rate. Entities can elect not to apply certain modification accounting requirements to contracts affected by this reference rate reform, if certain criteria are met. An entity that makes this election would not have to remeasure the contracts at the modification date or reassess a previous accounting determination. Entities can also elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform, if certain criteria are met. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company is currently assessing the impact that adoption of ASU 2020-04 will have on its Consolidated Financial Statements. In December 2019, the FASB issued ASU 2019-12, “ Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES As of June 30, 2020, the Company held two credit facilities whereby certain loans receivables were sold to wholly-owned VIEs to collateralize debt incurred under each facility. See Note 5, "Debt" for additional details on the Non-Recourse U.S. SPV facility, entered into in April 2020, and the Non-Recourse Canada SPV facility, entered into in August 2018. The Company determined that it is the primary beneficiary of the VIEs and is required to consolidate the entities. The Company includes the assets and liabilities related to the VIEs in the unaudited Condensed Consolidated Balance Sheets. As required, CURO parenthetically discloses on the unaudited Condensed Consolidated Balance Sheets the VIEs' assets that can only be used to settle the VIEs' obligations and liabilities if the VIEs' creditors have no recourse against the Company's general credit. The carrying amounts of consolidated VIEs' assets and liabilities associated with the VIE subsidiaries were as follows (in thousands): June 30, December 31, Assets Restricted cash $ 39,248 $ 17,427 Loans receivable less allowance for loan losses 242,840 220,067 Prepaid expenses and other 699 — Total Assets $ 282,787 $ 237,494 Liabilities Accounts payable and accrued liabilities $ 20,567 $ 13,462 Deferred revenue 111 46 Accrued interest 1,030 871 Intercompany payable 57,836 69,639 Debt 120,685 112,221 Total Liabilities $ 200,229 $ 196,239 |
LOANS RECEIVABLE AND REVENUE
LOANS RECEIVABLE AND REVENUE | 6 Months Ended |
Jun. 30, 2020 | |
Receivables [Abstract] | |
LOANS RECEIVABLE AND REVENUE | LOANS RECEIVABLE AND REVENUE COVID-19 impacted CURO's customers and overall credit performance. During the second quarter of 2020, federal governments in the U.S. and Canada provided various stimulus and income stability payments, which, among other impacts, resulted in lower demand for the Company's products and lower than expected NCOs. Ongoing impacts from and risks related to COVID-19 have caused continued uncertainty regarding the performance of NCOs over the loss-development period as of June 30, 2020. The Company has maintained its historical allowance approach, but has adjusted future loss estimates for changes in past-due gross loans receivable due to market conditions at June 30, 2020 caused by COVID-19. The estimates and assumptions used to determine an appropriate allowance for loan losses and liability for losses on CSO lender-owned consumer loans are those that are available through the filing of this Form 10-Q and which are indicative of conditions occurring as of June 30, 2020. Additionally, as a result of COVID-19, the Company enhanced its Customer Care Program and began modifying loans for borrowers that experienced financial distress, as discussed in more detail in Note 1 , " S ummary o f S ignifi c ant A ccounting P ol icies and N ature of O perations " and the tables below. The following table summarizes revenue by product (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Unsecured Installment $ 70,429 $ 122,112 $ 192,838 $ 257,890 Secured Installment 19,401 26,076 45,687 53,553 Open-End 56,736 54,972 127,718 107,841 Single-Pay 22,732 45,528 67,889 92,289 Ancillary 13,211 15,612 29,183 30,666 Total revenue (1) $ 182,509 $ 264,300 $ 463,315 $ 542,239 (1) Includes revenue from CSO programs of $37.8 million and $63.6 million for the three months ended June 30, 2020 and 2019, respectively, and $105.8 million and $127.8 million for the six months ended June 30, 2020 and 2019, respectively. The following tables summarize loans receivable by product and the related delinquent loans receivable (in thousands): June 30, 2020 Single-Pay (1) Unsecured Installment Secured Installment Open-End Total Current loans receivable $ 36,130 $ 63,835 $ 44,675 $ 253,948 $ 398,588 Delinquent loans receivable — 17,766 8,950 31,208 57,924 Total loans receivable 36,130 81,601 53,625 285,156 456,512 Less: allowance for losses (2,802) (18,451) (7,883) (47,319) (76,455) Loans receivable, net $ 33,328 $ 63,150 $ 45,742 $ 237,837 $ 380,057 (1) Of the $36.1 million of Single-Pay receivables, $8.1 million relate to mandated extended payment options for certain Canada Single-Pay loans. June 30, 2020 Unsecured Installment Secured Installment Open-End Total Delinquent loans receivable 0-30 days past due $ 5,207 $ 3,500 $ 11,743 $ 20,450 31-60 days past due 3,825 2,157 7,225 13,207 61 + days past due 8,734 3,293 12,240 24,267 Total delinquent loans receivable $ 17,766 $ 8,950 $ 31,208 $ 57,924 December 31, 2019 Single-Pay (1) Unsecured Installment Secured Installment Open-End Total Current loans receivable $ 81,447 $ 117,682 $ 70,565 $ 285,452 $ 555,146 Delinquent loans receivable — 43,100 17,510 50,072 110,682 Total loans receivable 81,447 160,782 88,075 335,524 665,828 Less: allowance for losses (5,869) (35,587) (10,305) (55,074) (106,835) Loans receivable, net $ 75,578 $ 125,195 $ 77,770 $ 280,450 $ 558,993 (1) Of the $81.4 million of Single-Pay receivables, $22.4 million relate to mandated extended payment options for certain Canada Single-Pay loans. December 31, 2019 Unsecured Installment Secured Installment Open-End Total Delinquent loans receivable 0-30 days past due $ 15,369 $ 8,039 $ 21,823 $ 45,231 31-60 days past due 12,403 4,885 13,191 30,479 61 + days past due 15,328 4,586 15,058 34,972 Total delinquent loans receivable $ 43,100 $ 17,510 $ 50,072 $ 110,682 The following tables summarize loans guaranteed by the Company under CSO programs and the related delinquent receivables (in thousands): June 30, 2020 Unsecured Installment Secured Installment Total Current loans receivable guaranteed by the Company $ 29,063 $ 887 $ 29,950 Delinquent loans receivable guaranteed by the Company 4,019 123 4,142 Total loans receivable guaranteed by the Company 33,082 1,010 34,092 Less: Liability for losses on CSO lender-owned consumer loans (5,128) (36) (5,164) Loans receivable guaranteed by the Company, net $ 27,954 $ 974 $ 28,928 June 30, 2020 Unsecured Installment Secured Installment Total Delinquent loans receivable 0-30 days past due $ 3,411 $ 104 $ 3,515 31-60 days past due 347 11 358 61+ days past due 261 8 269 Total delinquent loans receivable $ 4,019 $ 123 $ 4,142 December 31, 2019 Unsecured Installment Secured Installment Total Current loans receivable guaranteed by the Company $ 61,840 $ 1,944 $ 63,784 Delinquent loans receivable guaranteed by the Company 12,477 392 12,869 Total loans receivable guaranteed by the Company 74,317 2,336 76,653 Less: Liability for losses on CSO lender-owned consumer loans (10,553) (70) (10,623) Loans receivable guaranteed by the Company, net $ 63,764 $ 2,266 $ 66,030 December 31, 2019 Unsecured Installment Secured Installment Total Delinquent loans receivable 0-30 days past due $ 10,392 $ 326 $ 10,718 31-60 days past due 1,256 40 1,296 61 + days past due 829 26 855 Total delinquent loans receivable $ 12,477 $ 392 $ 12,869 The following tables summarize activity in the allowance for loan losses and the liability for losses on CSO lender-owned consumer loans in total (in thousands): Three Months Ended June 30, 2020 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 4,693 $ 28,965 $ 9,726 $ 56,458 $ — $ 99,842 Charge-offs (21,168) (30,129) (11,747) (37,784) (750) (101,578) Recoveries 21,766 7,019 2,961 6,100 398 38,244 Net charge-offs 598 (23,110) (8,786) (31,684) (352) (63,334) Provision for losses (2,588) 12,584 6,943 21,341 352 38,632 Effect of foreign currency translation 99 12 — 1,204 — 1,315 Balance, end of period $ 2,802 $ 18,451 $ 7,883 $ 47,319 $ — $ 76,455 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 9,142 $ 47 $ — $ — $ 9,189 Decrease in liability — 4,014 11 — — 4,025 Balance, end of period $ — $ 5,128 $ 36 $ — $ — $ 5,164 Three Months Ended June 30, 2019 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 3,897 $ 33,666 $ 9,796 $ 46,963 $ — $ 94,322 Charge-offs (35,759) (37,336) (10,295) (30,688) (1,342) (115,420) Recoveries 24,301 5,366 2,693 5,537 822 38,719 Net charge-offs (11,458) (31,970) (7,602) (25,151) (520) (76,701) Provision for losses 12,446 33,514 7,802 29,373 520 83,655 Effect of foreign currency translation 56 13 — 532 — 601 Balance, end of period $ 4,941 $ 35,223 $ 9,996 $ 51,717 $ — $ 101,877 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 8,583 $ 78 $ — $ — $ 8,661 Increase in liability — (850) 7 — — (843) Balance, end of period $ — $ 9,433 $ 71 $ — $ — $ 9,504 Six Months Ended June 30, 2020 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 5,869 $ 35,587 $ 10,305 $ 55,074 $ — $ 106,835 Charge-offs (61,689) (68,687) (24,857) (81,293) (2,028) (238,554) Recoveries 51,770 12,802 5,870 12,511 977 83,930 Net charge-offs (9,919) (55,885) (18,987) (68,782) (1,051) (154,624) Provision for losses 7,051 38,766 16,565 62,332 1,051 125,765 Effect of foreign currency translation (199) (17) — (1,305) — (1,521) Balance, end of period $ 2,802 $ 18,451 $ 7,883 $ 47,319 $ — $ 76,455 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 10,553 $ 70 $ — $ — $ 10,623 Decrease in liability — 5,425 34 — — 5,459 Balance, end of period $ — $ 5,128 $ 36 $ — $ — $ 5,164 Six Months Ended June 30, 2019 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 4,189 $ 37,716 $ 12,191 $ 19,901 $ — $ 73,997 Charge-offs (72,280) (81,573) (22,966) (34,326) (2,693) (213,838) Recoveries 52,212 11,684 5,816 10,696 1,721 82,129 Net charge-offs (20,068) (69,889) (17,150) (23,630) (972) (131,709) Provision for losses 20,714 67,359 14,955 54,690 972 158,690 Effect of foreign currency translation 106 37 — 756 — 899 Balance, end of period $ 4,941 $ 35,223 $ 9,996 $ 51,717 $ — $ 101,877 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 11,582 $ 425 $ — $ — $ 12,007 Decrease (increase) in liability — 2,149 354 — — 2,503 Balance, end of period $ — $ 9,433 $ 71 $ — $ — $ 9,504 As of June 30, 2020, Installment and Open-End loans classified as nonaccrual were approximately $8.9 million and $5.3 million, respectively. As of December 31, 2019, Installment and Open-End loans classified as nonaccrual were approximately $16.6 million and $7.9 million, respectively. The Company's loans receivable inherently considers nonaccrual loans in its estimate of the allowance for loan losses as delinquencies are a primary input into the Company's roll rate-based model. TDR LOANS RECEIVABLE The table below presents TDRs included in gross loans receivable and the impairment included in the allowance for loan losses (in thousands): As of Current TDR gross receivables $ 13,803 Delinquent TDR gross receivables 6,534 Total TDR gross receivables 20,337 Less: Impairment included in the allowance for loan losses (9,043) Outstanding TDR receivables, net of impairment $ 11,294 There were no TDR's as of December 31, 2019. The tables below reflect new loans modified and classified as TDRs during the periods presented (in thousands): Three and Six Months Ended June 30, 2020 Pre-modification TDR loans receivable $ 24,069 Post-modification TDR loans receivable 21,390 Total concessions included in gross charge-offs $ 2,679 There was $0.9 million of loans classified as TDRs that were charged off and included as a reduction in the allowance for loan losses during the three and six months ended June 30, 2020. The Company had commitments to lend additional funds of approximately $1.8 million to customers with available and unfunded Open-End loans classified as TDRs as of June 30, 2020. The table below presents the Company's average outstanding TDR loans receivable and interest income recognized on TDR loans for the three and six months ended June 30, 2020 (in thousands): Three and Six Months Ended June 30, 2020 Average outstanding TDR loans receivable (1) $ 20,864 Interest income recognized 4,396 Number of TDR loans (2) 21,512 (1) As there were no TDRs prior to April 1, 2020, the average outstanding TDR loans receivable is calculated based on the amount immediately after the loan was classified as a TDR and the ending TDR balance as of June 30, 2020. (2) Presented in ones There were no loans classified as TDRs during the three and six month periods ended June 30, 2019. |
CREDIT SERVICES ORGANIZATION
CREDIT SERVICES ORGANIZATION | 6 Months Ended |
Jun. 30, 2020 | |
Guarantees [Abstract] | |
CREDIT SERVICES ORGANIZATION | CREDIT SERVICES ORGANIZATION The CSO fee receivables under CSO programs were $3.8 million and $14.7 million at June 30, 2020 and December 31, 2019, respectively, and are reflected in "Prepaid expenses and other" in the unaudited Condensed Consolidated Balance Sheets. The Company bears the risk of loss through its guarantee to purchase specific customer loans that are in default with the lenders. The terms of these loans range up to six months. See the 2019 Form 10-K for further details of the Company's accounting policy. As of June 30, 2020 and December 31, 2019, the incremental maximum amount payable under all such guarantees was $28.6 million and $62.7 million, respectively. If the Company is required to pay any portion of the total amount of the loans it has guaranteed, it will attempt to recover some or the entire amount from the applicable customers. The Company holds no collateral in respect of the guarantees. The Company estimates a liability for losses associated with the guaranty provided to the CSO lenders. Liability for losses on CSO loans Guaranteed by the Company was $5.2 million and $10.6 million at June 30, 2020 and December 31, 2019, respectively. Deferred revenue associated with the CSO program was immaterial as of June 30, 2020 and December 31, 2019 and there were no costs to obtain, or costs to fulfill, capitalized under the program. See Note 3, "Loans Receivable and Revenue" |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Debt consisted of the following (in thousands): June 30, 2020 December 31, 2019 8.25% Senior Secured Notes (due 2025) $ 679,143 $ 678,323 Non-Recourse U.S. SPV Facility 31,896 — Non-Recourse Canada SPV Facility 88,789 112,221 Debt $ 799,828 $ 790,544 8.25% Senior Secured Notes In August 2018, the Company issued $690.0 million of 8.25% Senior Secured Notes which mature on September 1, 2025. Interest on the notes is payable semiannually, in arrears, on March 1 and September 1. In connection with the 8.25% Senior Secured Notes, the remaining balance of capitalized financing costs of $10.9 million, net of amortization, is included in the unaudited Condensed Consolidated Balance Sheets as a component of "Debt." These costs are amortized over the term of the 8.25% Senior Secured Notes as a component of interest expense. Non-Recourse U.S. SPV Facility In April, 2020, Curo Receivables Finance II, LLC, a bankruptcy-remote special purpose vehicle (the “U.S. SPV Borrower”) and an indirect wholly-owned subsidiary of the Company, entered into the Non-Recourse U.S. SPV Facility with Midtown Madison Management LLC, as administrative agent, and Atalaya Asset Income Fund VI LP, as the initial lender. As of June 30, 2020, the Non-Recourse U.S. SPV Facility provided for $100.0 million of borrowing capacity. On July 31, 2020, the Company obtained additional commitments, which increased its capacity to $200.0 million. See Note 19, "Subsequent Events" for additional information. The Non-Recourse U.S. SPV Facility is secured by a first lien against all assets of the U.S. SPV Borrower. The lenders will make advances against the principal balance of the eligible Installment, Open-End and bank partner loans sold to the U.S. SPV Borrower. The initial advance rate is 65% and, subject to certain conditions, may increase to up to 90% beginning October 1, 2020. Interest accrues at an annual rate of one-month LIBOR plus (i) prior to the increase in commitments, 9.75% and (ii) from and after the increase in commitments, 5.75%. The U.S. SPV Borrower will pay the lenders additional interest if it does not borrow minimum specified percentages of the available commitments and a monthly 0.50% per annum commitment fee on the unused portion of the commitments. Advances under the Non-Recourse U.S. SPV Facility will be subject to a 1.0% original issue discount against the maximum commitment. The Non-Recourse U.S. SPV Facility may not be prepaid prior to April 8, 2021. Prepayments incur a fee equal to (a) prior to September 8, 2021, 3.0% of the aggregate commitments, (b) thereafter, until March 8, 2022, 2.0% of the aggregate commitments, and (c) thereafter, zero. As of June 30, 2020, outstanding borrowers under the Non-Recourse U.S. SPV Facility were $31.9 million, net of deferred financing costs of $3.3 million. For further information on the Non-Recourse U.S. SPV Facility, refer to Note 2, "Variable Interest Entities." Non-Recourse Canada SPV Facility On August 2, 2018, CURO Canada Receivables Limited Partnership, a bankruptcy-remote special purpose vehicle (the "Canada SPV Borrower") and a wholly-owned subsidiary, entered into the Non-Recourse Canada SPV Facility with Waterfall Asset Management, LLC that provided for C$175.0 million of initial borrowing capacity and the ability to expand such capacity up to C$250.0 million. The loans bear interest at an annual rate of 6.75% plus the three-month CDOR. The Canada SPV Borrower also pays a 0.50% per annum commitment fee on the unused portion of the commitments. In April 2019, the facility's maturity date was extended one year, to September 2, 2023. As of June 30, 2020, outstanding borrowings under the Non-Recourse Canada SPV Facility were $88.8 million, net of deferred financing costs of $2.3 million. For further information on the Non-Recourse Canada SPV, refer to Note 2, "Variable Interest Entities." Senior Revolver The Company maintains the Senior Revolver that provides $50.0 million of borrowing capacity, including up to $5.0 million of standby letters of credit, for a one-year term, renewable for successive terms following annual review. The current term has been extended to June 30, 2021. The Senior Revolver accrues interest at one-month LIBOR plus 5.00% (subject to a 5% overall minimum). The Senior Revolver is syndicated with participation by four banks. The terms of the Senior Revolver also require that its outstanding balance be zero for at least 30 consecutive days in each calendar year. The Senior Revolver is guaranteed by all subsidiaries that guarantee the 8.25% Senior Secured Notes and is secured by a lien on substantially all assets of CURO and the guarantor subsidiaries that is senior to the lien securing the 8.25% Senior Secured Notes. Additionally, the negative covenants of the Senior Revolver generally conform to the related provisions in the Indenture for the 8.25% Senior Secured Notes. The Senior Revolver contains various conditions to borrowing and affirmative, negative and financial maintenance covenants. Certain of the more significant covenants are (i) minimum eligible collateral value, (ii) consolidated interest coverage ratio and (iii) consolidated leverage ratio. The Senior Revolver also contains various events of default, the occurrence of which could result in termination of the lenders’ commitments to lend and the acceleration of all obligations under the Senior Revolver. The revolver was undrawn at June 30, 2020. Cash Money Revolving Credit Facility Cash Money maintains the Cash Money Revolving Credit Facility, a C$10.0 million revolving credit facility with Royal Bank of Canada, which provides short-term liquidity required to meet the working capital needs of the Company's Canadian operations. Aggregate draws under the revolving credit facility are limited to the lesser of: (i) the borrowing base, which is the percentage of cash, deposits in transit and accounts receivable, and (ii) C$10.0 million. As of June 30, 2020, the borrowing capacity under the Cash Money Revolving Credit Facility, was C$9.9 million, net of C$0.1 million in outstanding stand-by-letters of credit. The Cash Money Revolving Credit Facility is collateralized by substantially all of Cash Money’s assets and contains various covenants that require, among other things, that the aggregate borrowings outstanding under the facility not exceed the borrowing base, as well as restrictions on the encumbrance of assets and the creation of indebtedness. Borrowings under the Cash Money Revolving Credit Facility bear interest per annum at the prime rate of a Canadian chartered bank plus 1.95%. The Cash Money Revolving Credit Facility was undrawn at June 30, 2020. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATIONThe Company's stockholder-approved 2017 Incentive Plan provides for the issuance of up to 5.0 million shares, subject to certain adjustments, which may be issued in the form of stock options, restricted stock awards, RSUs, stock appreciation rights, performance awards and other awards that may be settled in or based on common stock. Awards may be granted to officers, employees, consultants and directors. The 2017 Incentive Plan provides that shares of common stock subject to awards granted become available for re-issuance if such awards expire, terminate, are canceled for any reason or are forfeited by the recipient. Restricted Stock Units Grants of time-based RSUs are valued at the date of grant based on the closing market price of common stock and are expensed using the straight-line method over the service period. Time-based RSUs typically vest over a three-year period. Grants of market-based RSUs are valued using the Monte Carlo simulation pricing model. The market-based RSUs vest after three years if the Company's total stockholder return over the three-year performance period meets a specified target relative to other companies in its selected peer group. Expense recognition for the market-based RSUs occurs over the service period using the straight-line method. Unvested shares of RSUs generally are forfeited upon termination of employment, or failure to achieve the required performance condition, if applicable. A summary of the activity of time-based and market-based unvested RSUs as of June 30, 2020 and changes during the six months ended June 30, 2020 are presented in the following table: Number of RSUs Time-Based Market-Based Weighted Average December 31, 2019 1,061,753 394,861 $ 11.47 Granted 679,413 368,539 10.42 Vested (307,142) — 11.34 Forfeited (24,025) (4,687) 11.99 June 30, 2020 1,409,999 758,713 $ 10.97 Share-based compensation expense for the three months ended June 30, 2020 and 2019, which includes compensation costs from stock options and RSUs, was $3.3 million and $2.6 million, respectively, and during the six months ended June 30, 2020 and 2019 was $6.5 million and $4.8 million, respectively. Share-based compensation expense is included in the unaudited Condensed Consolidated Statements of Operations as a component of "Corporate, district and other expenses." |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company's effective income tax rate was 5.0% and 27.4% for the six months ended June 30, 2020 and 2019, respectively. The decrease in effective income tax rate was primarily due to a tax benefit from the CARES Act, which was enacted by the U.S. Federal government on March 27, 2020 in response to the COVID-19 pandemic. The CARES Act, among other things, allows NOLs incurred in 2018, 2019 and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously-paid Federal income taxes. In the first quarter of 2020, the Company recorded an income tax benefit of $9.1 million related to the carry-back NOL from tax years 2018 and 2019, which will offset income earned in years prior to the 2017 tax reform and generate a refund of previously paid taxes at a 35% statutory rate. Additionally, in the second quarter of 2020, the Company recorded a tax benefit of $4.6 million from the release of a valuation allowance previously recorded against NOLs for certain entities in Canada. This benefit was partially offset by uncertain tax position reserve adjustments in the U.S. of $1.1 million. Losses from the Company's equity method investment in Katapult for the six months ended June 30, 2020 are not tax deductible, thus increasing the above effective income tax rate. The Company intends to reinvest Canada earnings indefinitely in its Canadian operations and therefore has not provided for any non-U.S. withholding tax that would be assessed on dividend distributions. If the earnings of $185.2 million were distributed to the U.S. legal entities, the Company would be subject to Canadian withholding taxes of an estimated $9.3 million. In the event the earnings were distributed to the U.S. legal entities, the Company would adjust the income tax provision for the applicable period and would determine the amount of foreign tax credit that would be available. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Company is required to use valuation techniques that are consistent with the market approach, income approach and/or cost approach. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability based on observable market data obtained from independent sources, or unobservable, meaning those that reflect the Company's own estimate about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. Accounting standards establish a three-level fair value hierarchy based upon the assumptions (inputs) used to price assets or liabilities. The hierarchy requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are listed below. Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has access to at the measurement date. Level 2 – Inputs include quoted market prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 – Unobservable inputs reflecting the Company's own judgments about the assumptions market participants would use in pricing the asset or liability since limited market data exists. The Company develops these inputs based on the best information available, including its own data. Financial Assets and Liabilities Carried at Fair Value The table below presents the assets and liabilities that were carried at fair value on the unaudited Condensed Consolidated Balance Sheets at June 30, 2020 (in thousands): Estimated Fair Value Carrying Value June 30, Level 1 Level 2 Level 3 Total Financial assets: Cash Surrender Value of Life Insurance $ 6,409 $ 6,409 $ — $ — $ 6,409 Financial liabilities: Non-qualified deferred compensation plan $ 4,292 $ 4,292 $ — $ — $ 4,292 The table below presents the assets and liabilities that were carried at fair value on the unaudited Condensed Consolidated Balance Sheets at December 31, 2019 (in thousands): Estimated Fair Value Carrying Value December 31, Level 1 Level 2 Level 3 Total Financial assets: Cash Surrender Value of Life Insurance $ 6,171 $ 6,171 $ — $ — $ 6,171 Financial liabilities: Non-qualified deferred compensation plan $ 4,666 $ 4,666 $ — $ — $ 4,666 Financial Assets and Liabilities Not Carried at Fair Value The table below presents the assets and liabilities that were not carried at fair value on the unaudited Condensed Consolidated Balance Sheets at June 30, 2020 (in thousands): Estimated Fair Value Carrying Value June 30, Level 1 Level 2 Level 3 Total Financial assets: Cash and cash equivalents $ 269,342 $ 269,342 $ — $ — $ 269,342 Restricted cash 63,274 63,274 — — 63,274 Loans receivable, net 380,057 — — 380,057 380,057 Equity method investment 9,191 — — 9,191 9,191 Financial liabilities: Liability for losses on CSO lender-owned consumer loans $ 5,164 $ — $ — $ 5,164 $ 5,164 8.25% Senior Secured Notes 679,143 — 543,111 — 543,111 Non-Recourse U.S. SPV facility 31,896 — — 35,206 35,206 Non-Recourse Canada SPV facility 88,789 — — 91,109 91,109 The table below presents the assets and liabilities that were not carried at fair value on the unaudited Condensed Consolidated Balance Sheets at December 31, 2019 (in thousands): Estimated Fair Value Carrying Value December 31, Level 1 Level 2 Level 3 Total Financial assets: Cash and cash equivalents $ 75,242 $ 75,242 $ — $ — $ 75,242 Restricted cash 34,779 34,779 — — 34,779 Loans receivable, net 558,993 — — 558,993 558,993 Equity method investment 10,068 — — 10,068 10,068 Financial liabilities: Liability for losses on CSO lender-owned consumer loans $ 10,623 $ — $ — $ 10,623 $ 10,623 8.25% Senior Secured Notes 678,323 — 596,924 — 596,924 Non-Recourse Canada SPV facility 112,221 — — 115,243 115,243 Loans receivable are carried on the unaudited Condensed Consolidated Balance Sheets net of the Allowance for loan losses. The unobservable inputs used to calculate the carrying values include quantitative factors, such as current default trends. Also considered in evaluating the accuracy of the models are changes to the loan portfolio mix, the impact of new loan products, changes to underwriting criteria or lending policies, new store development or entrance into new markets, changes in jurisdictional regulations or laws, recent credit trends and general economic conditions. The carrying value of loans receivable approximates their fair value. Refer to Note 3, "Loans Receivable and Revenue" for additional information. During 2019, Katapult completed an incremental equity round at a value per share less than the value per share raised in prior raises. This round included additional investments from existing shareholders and investments by new investors, and was considered indicative of the fair value of shares in Katapult. Accordingly, the Company recognized a $3.7 million loss on its investment to adjust it to market value. As of June 30, 2020, the Company owned approximately 42.5% of the outstanding shares of Katapult. In connection with CSO programs, the Company guarantees consumer loan payment obligations to unrelated third-party lenders for loans that the Company arranges for consumers on the third-party lenders’ behalf. The Company is required to purchase from the lender defaulted loans that it has guaranteed. Refer to Note 3, "Loans Receivable and Revenue" and Note 4, Credit Service s Organization " for additional information. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY The following table summarizes the changes in stockholders' equity for the three and six months ended June 30, 2020 and 2019 (in thousands): Common Stock Treasury Stock Paid-in capital Retained Earnings (Deficit) AOCI (1) Total Stockholders' Equity Shares Outstanding Par Value Balances at December 31, 2019 41,156,224 $ 9 $ (72,343) $ 68,087 $ 93,423 $ (38,663) $ 50,513 Net income from continuing operations — — — — 36,013 — 36,013 Net income from discontinued operations — — — — 292 — 292 Foreign currency translation adjustment — — — — — (22,193) (22,193) Dividends — — — — (2,256) — — (2,256) Share based compensation expense — — — 3,194 — — 3,194 Proceeds from exercise of stock options 42,094 — — 126 — — 126 Repurchase of common stock (540,762) — (5,509) — — — (5,509) Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 121,891 — — (609) — — (609) Balances at March 31, 2020 40,779,447 $ 9 $ (77,852) $ 70,798 $ 127,472 $ (60,856) $ 59,571 Net income from continuing operations — — — — 21,080 — 21,080 Net income from discontinued operations — — — — 993 — 993 Foreign currency translation adjustment — — — — — 10,261 10,261 Dividends — — — — (2,244) — (2,244) Share based compensation expense — — — 3,310 — — 3,310 Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 105,098 — — (29) — — (29) Balances at June 30, 2020 40,884,545 $ 9 $ (77,852) $ 74,079 $ 147,301 $ (50,595) $ 92,942 (1) Accumulated other comprehensive income (loss) Common Stock Treasury Stock Paid-in capital Retained Earnings (Deficit) AOCI (1) Total Stockholders' Equity (Deficit) Shares Outstanding Par Value Balances at December 31, 2018 46,412,231 $ 9 $ — $ 60,015 $ (18,065) $ (61,060) $ (19,101) Net income from continuing operations — — — — 28,673 — 28,673 Net income from discontinued operations — — — — 8,375 — 8,375 Foreign currency translation adjustment — — — — — 16,695 16,695 Share based compensation expense — — — 2,172 — — 2,172 Proceeds from exercise of stock options 7,888 — — 40 — — 40 Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 11,170 — — (110) — — (110) Balances at March 31, 2019 46,431,289 $ 9 $ — $ 62,117 $ 18,983 $ (44,365) $ 36,744 Net income from continuing operations — — — — 17,667 — 17,667 Net loss from discontinued operations — — — — (834) — (834) Foreign currency translation adjustment — — — — — 3,635 3,635 Share based compensation expense — — — 2,644 — — 2,644 Proceeds from exercise of stock options 4,908 — — 29 — — 29 Repurchase of common stock (244,200) — (2,507) — — — (2,507) Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 63,285 — — — — — — Balances at June 30, 2019 46,255,282 $ 9 $ (2,507) $ 64,790 $ 35,816 $ (40,730) $ 57,378 (1) Accumulated other comprehensive income (loss) Dividend On February 5, 2020, the Company's Board of Directors announced the initiation of a dividend program and declared the Company's first cash dividend of $0.055 per share. A dividend of $2.2 million was paid on March 2, 2020 to stockholders of record on February 18, 2020. On April 30, 2020, the Company's Board of Directors declared its second dividend under the previously announced dividend program, of $0.055 per share. A dividend of $2.2 million was paid on May 27, 2020 to stockholders of record on May 13, 2020. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table presents the computation of basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended Six Months Ended 2020 2019 2020 2019 Net income from continuing operations $ 21,080 $ 17,667 $ 57,093 $ 46,340 Net income (loss) from discontinued operations, net of tax 993 (834) 1,285 7,541 Net income $ 22,073 $ 16,833 $ 58,378 $ 53,881 Weighted average common shares - basic 40,810 46,451 40,814 46,438 Dilutive effect of stock options and restricted stock units 735 656 872 897 Weighted average common shares - diluted 41,545 47,107 41,686 47,335 Basic earnings (loss) per share: Continuing operations $ 0.52 $ 0.38 $ 1.40 $ 1.00 Discontinued operations 0.02 (0.02) 0.03 0.16 Basic earnings per share $ 0.54 $ 0.36 $ 1.43 $ 1.16 Diluted earnings (loss) per share: Continuing operations $ 0.51 $ 0.38 $ 1.37 $ 0.98 Discontinued operations 0.02 (0.02) 0.03 0.16 Diluted earnings per share $ 0.53 $ 0.36 $ 1.40 $ 1.14 Potential shares of common stock that would have the effect of increasing diluted earnings per share or decreasing diluted loss per share are considered to be anti-dilutive and as such, these shares are not included in calculating diluted earnings per share. For the three and six months ended June 30, 2020 , there were 2.3 million and 1.7 million, respectively, and for the three and six months ended June 30, 2019, there were 1.3 million and 1.2 million, respectively, of potential shares of common stock excluded from the calculation of diluted earnings per share because their effect was anti-dilutive. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 6 Months Ended |
Jun. 30, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION The following table provides supplemental cash flow information (in thousands): Six Months Ended 2020 2019 Cash paid for: Interest $ 34,125 $ 34,678 Income taxes, net of refunds 1,133 4,231 Non-cash investing activities: Property and equipment accrued in accounts payable and accrued liabilities $ 117 $ 105 |
SEGMENT REPORTING
SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING Segment information is prepared on the same basis that the Company's CODM reviews financial information for operational decision making purposes, including revenues, net revenue, gross margin, segment operating income and other items. U.S. As of June 30, 2020, the Company operated a total of 211 U.S. retail locations and had an online presence in 27 states. The Company provides Single-Pay loans, Installment loans and Open-End loans, vehicle title loans, check cashing, money transfer services, reloadable prepaid debit cards and a number of other ancillary financial products and services to its customers in the U.S. As disclosed in Note 17, "Acquisition," the acquisition of Ad Astra closed during January 2020. The results of Ad Astra are included within the U.S. reporting segment. Canada. As of June 30, 2020, the Company operated a total of 204 stores across seven Canadian provinces and territories and had an online presence in five provinces. The Company provides Single-Pay loans, Installment loans and Open-End loans, insurance products to Open-End and Installment loan customers, check cashing, money transfer services, foreign currency exchange, reloadable prepaid debit cards and a number of other ancillary financial products and services to its customers in Canada. The following table illustrates summarized financial information concerning reportable segments (in thousands): Three Months Ended Six Months Ended 2020 2019 2020 2019 Revenues by segment: (1) U.S. $ 137,320 $ 210,046 $ 359,088 $ 436,165 Canada 45,189 54,254 104,227 106,074 Consolidated revenue $ 182,509 $ 264,300 $ 463,315 $ 542,239 Net revenues by segment: U.S. $ 95,790 $ 117,494 $ 231,517 $ 258,633 Canada 36,026 34,796 $ 67,569 69,211 Consolidated net revenue $ 131,816 $ 152,290 $ 299,086 $ 327,844 Gross margin by segment: U.S. $ 56,860 $ 65,067 $ 144,400 $ 154,870 Canada 19,639 16,114 31,798 31,808 Consolidated gross margin $ 76,499 $ 81,181 $ 176,198 $ 186,678 Segment operating income: U.S. $ 11,857 $ 17,029 $ 45,283 $ 48,224 Canada 10,291 8,091 14,815 15,615 Consolidated operating income $ 22,148 $ 25,120 $ 60,098 $ 63,839 Expenditures for long-lived assets by segment: U.S. $ 248 $ 2,568 $ 4,528 $ 4,998 Canada 144 477 697 1,166 Consolidated expenditures for long-lived assets $ 392 $ 3,045 $ 5,225 $ 6,164 (1) For revenue by product, see Note 3, "Loans Receivable and Revenue." The following table provides the proportion of gross loans receivable by segment (in thousands): June 30, December 31, U.S. $ 199,734 $ 363,453 Canada 256,778 302,375 Total gross loans receivable $ 456,512 $ 665,828 The following table represents the Company's net long-lived assets, comprised of property and equipment, by segment. These amounts are aggregated on a legal entity basis and do not necessarily reflect where the asset is physically located (in thousands): June 30, December 31, U.S. $ 39,974 $ 43,618 Canada 24,285 27,193 Total net long-lived assets $ 64,259 $ 70,811 The Company's CODM does not review assets by segment for purposes of allocating resources or decision-making purposes; therefore, total assets by segment are not disclosed. |
COMMITMENTS AND CONTENGENCIES
COMMITMENTS AND CONTENGENCIES | 6 Months Ended |
Jun. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTENGENCIES | COMMITMENTS AND CONTINGENCIES Securities Litigation and Enforcement On December 5, 2018, a putative securities fraud class action lawsuit was filed against the Company and its chief executive officer, chief financial officer and chief operating officer in the United States District Court for the District of Kansas, captioned Yellowdog Partners, LP v. CURO Group Holdings Corp., Donald F. Gayhardt, William Baker and Roger W. Dean , Civil Action No. 18-2662 (the "Yellowdog Action"). On May 31, 2019, plaintiff filed a consolidated complaint naming Doug Rippel, Chad Faulkner, Mike McKnight, Friedman Fleischer & Lowe Capital Partners II, L.P., FFL Executive Partners II, L.P., and FFL Parallel Fund II, L.P. (collectively, the "FFL Defendants") as additional defendants. The complaint alleges that the Company and the individual defendants violated Section 10(b) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and that certain defendants also violated Section 20(a) of the Exchange Act as "control persons" of CURO. Plaintiff purports to bring these claims on behalf of a class of investors who purchased Company common stock between April 27, 2018 and October 24, 2018. Plaintiff generally alleges that, during the putative class period, the Company made misleading statements and omitted material information regarding its efforts to transition the Canadian inventory of products from Single-Pay loans to Open-End loans. Plaintiff asserts that the Company and the individual defendants made these misstatements and omissions to keep the stock price high. Plaintiff seeks unspecified damages and other relief. On May 27, 2020, the parties accepted a mediator’s proposal to settle the action for $9.0 million. On June 1, 2020, the parties informed the Court of the settlement. On August 1, 2020, the parties’ submitted settlement papers to the Court seeking an order preliminarily approving the proposed settlement and providing for notice to the class and a final settlement hearing. The Company's directors' and officers' insurance carriers are expected to pay any amount in excess of the $2.5 million retention under the policy. As of June 30, 2020, the Company recorded a $9.0 million receivable in "Other assets" and an incremental $9.0 million liability in "Accounts Payable and accrued liabilities." In addition, there was $1.3 million in "Accounts payable and accrued liabilities," which represents the liability remaining of the $2.5 million insurance retention less cash payments made toward the retention. On June 25, 2020, July 2, 2020 and July 16, 2020, three shareholder derivative lawsuits were filed against certain directors and officers of the Company, the Company, and in two of the three lawsuits, the FFL Defendants, in the United States District Court for the District of Delaware. Plaintiffs generally allege the same underlying facts of the Yellowdog Action. While the Company is vigorously contesting these lawsuits, it cannot determine the final resolution or when they might be resolved. In addition to the expenses incurred in defending these litigations and any damages in excess of insurance coverages that may be awarded in the event of any adverse rulings, management’s efforts and attention may be diverted from the ordinary business operations to address these claims. Regardless of the outcomes, these litigations may have a material adverse impact on results because of defense costs, including costs related to indemnification obligations, diversion of resources and other factors. During the first quarter of 2019, the Company received an inquiry from the SEC regarding the Company's public disclosures surrounding its efforts to transition the Canadian inventory of products from Single-Pay loans to Open-End loans. During the second quarter of 2020, the SEC requested information from the Company concerning third-party information cited in plaintiff's complaint in the Yellowdog Action, and the mediation process described above. City of Austin The Company was cited in July 2016 by the City of Austin, Texas for alleged violations of the Austin ordinance addressing products offered by CSOs. The Austin ordinance regulates aspects of products offered under the Company's CAB program, including loan sizes and repayment terms. The Company believes that: (i) the Austin ordinance (similar to its counterparts elsewhere in Texas) conflicts with Texas state law and (ii) in any event, the Company's product complies with the ordinance, when the ordinance is properly construed. The Austin Municipal Court agreed with the Company's position that the ordinance conflicts with Texas law and, accordingly, did not address the second argument. In September 2017, the Travis County Court reversed the Municipal Court’s decision and remanded the case for further proceedings. To date, a hearing and trial on the merits have not been scheduled. On May 15, 2020, the City of Austin proposed an ordinance in direct response to a recent Texas Attorney General’s opinion which would arguably allow CSO’s to provide signature loans outside the regulatory authority of the OCCC and the City of Austin. The proposed ordinance was effective June 1, 2020. The City not only implemented restrictions on CSO transactions, but also revised certain definitions found in the ordinance. These revisions potentially affect the foundation upon which the Company's previous arguments in municipal court were based. On June 8, 2020, another company within CURO's industry filed a Petition for Declaratory Relief, Application for Temporary Restraining Order, and Application for Temporary and Permanent Injunction against the City. The Temporary Restraining Order was granted, and extended to August 24, 2020. During the pendency of the Temporary Restraining Order, the revised ordinance is stayed as to its effectiveness for all impacted companies, including the Company. The Company does not anticipate having a final determination of the lawfulness of its CAB program under the Austin ordinances (and similar ordinances in other Texas cities) in the near future. A final adverse decision could result in material monetary liability in Austin and elsewhere in Texas, and could force the Company to restructure the loans it originates in Austin and elsewhere in Texas. Other Legal Matters |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Leases | LEASES Operating leases entered into by the Company are primarily for retail stores in certain U.S. states and Canadian provinces. Leases classified as finance are immaterial to the Company as of June 30, 2020. Operating leases expire at various times through 2032. The Company determines if an arrangement is a lease at inception. Operating leases are included in "Right of use asset - operating leases" and "Lease liability - operating leases" on the Condensed Consolidated Balance Sheets. Typically, a contract is or contains a lease if it conveys the right to control the use of an identified property, plant or equipment (an identified asset) for a period of time in exchange for consideration. To determine whether a contract conveys the right to control the use of an identified asset for a period of time, the Company must assess whether, throughout the period of use, the customer has both (i) the right to obtain substantially all of the economic benefits from use of the identified asset and (ii) the right to direct the use of the identified asset. If the customer has the right to control the use of an identified asset for only a portion of the term of the contract, the contract contains a lease for that portion of the term. The Company recognizes ROU assets and lease liabilities based on the present value of lease payments over the lease term at commencement date. The rate implicit in the Company's leases typically are not readily determinable. As a result, the Company uses its estimated incremental borrowing rate, as allowed by ASC 842, in determining the present value of lease payments. The incremental borrowing rate is based on internal and external information available at the lease commencement date and is determined using a portfolio approach (i.e., using the weighted average terms of all leases in the Company's portfolio). This rate is the theoretical rate the Company would pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term as that of the portfolio. The Company uses quoted interest rates obtained from financial institutions as an input, adjusted for Company specific factors, to derive the incremental borrowing rate as the discount rate for the leases. As new leases are added each period, the Company evaluates whether the incremental borrowing rate has changed. If the incremental borrowing rate has changed, the Company will apply the rate to new leases if not doing so would result in a material difference to the ROU asset and lease liability presented on the balance sheet. The majority of the leases have an original term of five years with two five-year renewal options. The Consumer Price Index is used in determining future lease payments and for purposes of calculating operating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Most of the leases have escalation clauses and certain leases also require payment of period costs, including maintenance, insurance and property taxes. Some of the leases are with related parties and have terms similar to the non-related party leases. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. The following table summarizes the operating lease costs and other information for the three and six months ended June 30, 2020 and June 30, 2019 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Operating lease costs: Third-Party $ 7,576 $ 7,608 $ 15,221 $ 15,246 Related-Party 845 865 1,691 1,741 Total operating lease costs $ 8,421 $ 8,473 $ 16,912 $ 16,987 Operating cash flow - Operating leases $ 16,545 $ 17,420 New ROU assets - Operating leases $ 6,922 $ 9,468 Weighted average remaining lease term - Operating leases 6.1 years 6.3 years Weighted average discount rate - Operating leases 10.3 % 10.3 % The following table summarizes the aggregate operating lease maturities that the Company is contractually obligated to make under operating leases as of June 30, 2020 (in thousands): Third-Party Related-Party Total Remainder of 2020 $ 15,334 $ 1,839 $ 17,173 2021 28,475 3,763 32,238 2022 25,638 3,663 29,301 2023 20,836 1,319 22,155 2024 15,911 964 16,875 2025 11,492 864 12,356 Thereafter 30,676 2,661 33,337 Total 148,362 15,073 163,435 Less: Imputed interest (40,146) (3,522) (43,668) Operating lease liabilities $ 108,216 $ 11,551 $ 119,767 |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Jun. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONSOn February 25, 2019, in accordance with the provisions of the U.K. Insolvency Act 1986 and as approved by the Boards of Directors of the U.K. Subsidiaries, insolvency practitioners from KPMG were appointed as Administrators for the U.K. Subsidiaries. The effect of the U.K. Subsidiaries’ entry into administration was to place their management, affairs, business and property of the U.K. Subsidiaries under the direct control of the Administrators. Accordingly, the Company deconsolidated the U.K. Subsidiaries, which comprised the U.K. reportable operating segment, as of February 25, 2019 and classified them as Discontinued Operations for all periods presented. The following table presents the results of operations of the U.K. Subsidiaries, which meet the criteria of Discontinued Operations and, therefore, are excluded from the Company's results of continuing operations (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (1) Revenue $ — $ — $ — $ 6,957 Provision for losses — — — 1,703 Net revenue — — — 5,254 Cost of providing services Office — — — 246 Other costs of providing services — — — 61 Advertising — — — 775 Total cost of providing services — — — 1,082 Gross margin — — — 4,172 Operating (income) expense Corporate, district and other expenses — — — 3,810 Interest income — — — (4) (Gain) loss on disposition (1,324) — (1,714) 39,414 Total operating (income) expense (1,324) — (1,714) 43,220 Pre-tax income (loss) from operations of discontinued operations 1,324 — 1,714 (39,048) Income tax expense (benefit) related to disposition 331 834 429 (46,589) Net income (loss) from discontinued operations $ 993 $ (834) $ 1,285 $ 7,541 (1) Includes U.K. Subsidiaries financial results from January 1, 2019 to February 25, 2019. Revenue and expenses related to discontinued operations included activity prior to the deconsolidation of the U.K. subsidiaries effective February 25, 2019. For the six months ended June 30, 2019, "(Gain) loss on disposition" of $39.4 million included the non-cash effect of eliminating assets and liabilities of the U.K. Subsidiaries as of the date of deconsolidation, as well as the effect of cumulative currency exchange rate differences on the U.S. investment in the U.K. In connection with the disposition of the U.K. Subsidiaries, the U.S. entity that owned the Company's interests in the U.K. Subsidiaries recognized a loss on investment. This loss resulted in an estimated U.S. Federal and state income tax benefit of $46.6 million, which will be available to offset future income tax obligations. Subsequently, in 2019, the Company revised the estimated tax basis in the U.K. Subsidiaries, resulting in a $0.8 million reduction in the income tax benefit as of June 30, 2019. During the six months ended June 30, 2020, the Company received its final distributions from the Administrators related to the wind-down of the U.K. Subsidiaries. As of June 30, 2020 and December 31, 2019, the unaudited Condensed Consolidated Balance Sheets were not impacted by the U.K. Subsidiaries as all balances were written off when the U.K. segment entered into administration during the first quarter of 2019. The following table presents cash flows of the U.K. Subsidiaries (in thousands): Six Months Ended June 30, 2020 2019 (1) Net cash provided by (used in) discontinued operating activities $ 1,714 $ (504) Net cash used in discontinued investing activities — (14,213) Net cash used in discontinued financing activities — — (1) Includes U.K. Subsidiaries financial results from January 1, 2019 to February 25, 2019. |
GOODWILL
GOODWILL | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | GOODWILL The change in the carrying amount of goodwill by operating segment for the six months ended June 30, 2020 was as follows (in thousands): U.S. Canada Total Goodwill at December 31, 2019 $ 91,131 $ 29,478 $ 120,609 Acquisition (Note 17) 14,791 — 14,791 Foreign currency translation — (1,423) (1,423) Goodwill at June 30, 2020 $ 105,922 $ 28,055 $ 133,977 The Company tests goodwill at least annually for impairment (the Company has elected to annually test for potential impairment of goodwill on October 1) and more frequently if indicators are present or changes in circumstances suggest that impairment may exist. The indicators include, among others, declines in sales, earning or cash flows or the development of a material adverse change in business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment, referred to as a reporting unit. See Note 1, "Summary of Significant Accounting Policies and Nature of Operations" of the 2019 Form 10-K for additional information on the Company's policy for assessing goodwill for impairment. In the second quarter of 2020, the Company performed an interim qualitative assessment of goodwill on both reporting units to consider whether current events or circumstances, attributable to uncertainty caused by COVID-19, resulted in a more-likely-than-not determination that the fair values of the reporting units fell below their respective carrying values. As a result of the interim qualitative assessment, the Company concluded that the fair value of each reporting unit was in excess of its respective carrying value and did not record any impairment losses during the six months ended June 30, 2020. Ad Astra Acquisition The Company completed the acquisition of Ad Astra on January 3, 2020. Goodwill of $14.8 million was recorded in the U.S. reporting unit during the six months ended June 30, 2020, based on the excess of the purchase price of the business combination over the fair value of the acquired net assets. See Note 17, "Acquisition" |
ACQUISITION
ACQUISITION | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
ACQUISITION | ACQUISITION On January 3, 2020, the Company acquired 100% of the outstanding stock of Ad Astra, a related party, for total consideration of $14.4 million, net of cash received. Prior to the acquisition, Ad Astra was the Company's exclusive provider of third-party collection services for owned and managed loans in the U.S. that are in later-stage delinquency. The Company began consolidating the financial results of this acquisition in the unaudited Condensed Consolidated Financial Statements on January 3, 2020. For the six months ended June 30, 2019, prior to the acquisition, $8.4 million of costs related to Ad Astra were included in "Other costs of providing services." Subsequent to the acquisition, operating costs for Ad Astra are included within "Corporate, district and other expenses," consistent with presentation of other internal collection costs. Ad Astra incurred $5.6 million of operating expense during the six months ended June 30, 2020. The transaction has been accounted for using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The Company was the acquirer for purposes of accounting for the business combination. The values assigned to the assets acquired and liabilities assumed are based on their estimates of fair value available. The Company completed the determination of the fair values of the acquired identifiable assets and liabilities based on the information available during March 2020. The following table summarizes the allocation of the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: (in thousands) Amounts acquired on January 3, 2020 Cash consideration transferred: $ 17,811 Cash and cash equivalents 3,360 Accounts receivable 465 Property and equipment 358 Intangible assets 1,101 Goodwill 14,791 Operating lease asset 235 Accounts payable and accrued liabilities (2,264) Operating lease liabilities (235) Total $ 17,811 Goodwill of $14.8 million represents the excess over the fair value of the net tangible and intangible assets acquired. Goodwill is not deductible for income tax purposes. |
SHARE REPURCHASE PROGRAM
SHARE REPURCHASE PROGRAM | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
SHARE REPURCHASE PROGRAM | SHARE REPURCHASE PROGRAM In February 2020, the Company's Board of Directors authorized a new share repurchase program for up to $25.0 million of its common stock. Due to uncertainty caused by COVID-19, the Board suspended the program on March 15, 2020. There were no material purchases under the program during the six months ended June 30, 2020. In April 2019, the Company's Board of Directors authorized a share repurchase program providing for the repurchase of up to $50.0 million of its common stock. The repurchase program, which commenced June 2019, was completed in February 2020. Under this program, the Company repurchased 455,255 shares of its common stock at an average price of $10.45 per share for total consideration of $4.8 million during the six months ended June 30, 2020. Purchases under the program were made from time-to-time in the open market, in privately negotiated transactions, or both, at the Company's discretion and subject to market conditions and other factors. Any repurchased shares are available for use in connection with equity plans or other corporate purposes. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Dividend On August 3, 2020, the Company's Board of Directors declared a dividend under its previously announced dividend program, of $0.055 per share to be paid on August 24, 2020 to stockholders of record on August 13, 2020. On July 31, 2020, the Company obtained additional commitments on the Non-Recourse U.S. SPV Facility, which increased its capacity to $200.0 million and reduced the interest rate to one-month LIBOR (with a floor of 1.65%) plus 6.25% on balances up to $145.5 million. Balances above $145.5 million accrue interest at an annual rate of one-month LIBOR (with a floor of 1.65%) plus 9.75%. See Note 5, "Debt" |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Nature of Operations and Basis of Presentation | Nature of Operations and Basis of Presentation The terms “CURO" and the “Company” refer to CURO Group Holdings Corp. and its wholly-owned subsidiaries as a consolidated entity, except where otherwise stated. CURO is a growth-oriented, technology-enabled, highly-diversified consumer finance company serving a wide range of underbanked consumers in the U.S., Canada and, through February 25, 2019, the U.K. The Company has prepared the accompanying unaudited Condensed Consolidated Financial Statements in accordance with US GAAP, and with the accounting policies described in its 2019 Form 10-K. Interim results of operations are not necessarily indicative of results that might be expected for future interim periods or for the year ending December 31, 2020. Certain information and note disclosures normally included in annual financial statements prepared in accordance with US GAAP have been condensed or omitted, although the Company believes that the disclosures are adequate to enable a reasonable understanding of the information presented. Additionally, the Company qualifies as an SRC as defined by the SEC, which allows registrants to report information under scaled disclosure requirements. SRC status is determined on an annual basis as of the last business day of the most recently completed second fiscal quarter. Under these rules, the Company met the definition of an SRC as of June 30, 2020, and it will reevaluate its status as of June 30, 2021. |
Principles of Consolidation | Principles of Consolidation The unaudited Condensed Consolidated Financial Statements include the accounts of CURO and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of EstimatesThe preparation of the unaudited Condensed Consolidated Financial Statements in conformity with US GAAP requires management to make estimates and assumptions, such as those impacted by COVID-19, that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenues and expenses during the periods presented. Some of the significant estimates that the Company made in the accompanying unaudited Condensed Consolidated Financial Statements include allowances for loan losses, certain assumptions related to equity investments, goodwill and intangibles, accruals related to self-insurance, CSO liability for losses and estimated tax liabilities. Actual results may differ from those estimates. |
Troubled Debt Restructuring | Troubled Debt Restructuring In certain circumstances, the Company modifies the terms of its loans receivable for borrowers. Under US GAAP, a modification of loans receivable terms is considered a TDR if the borrower is experiencing financial difficulty and the Company grants a concession to the borrower it would not have otherwise granted. In light of the COVID-19 pandemic, the Company established an enhanced Customer Care Program, which enables its team members to provide relief to customers in various ways, ranging from due date changes, interest or fee forgiveness, payment waivers or extended payment plans, depending on a customer’s individual circumstances. The Company modifies loans only if it believes the customer has the ability to pay under the restructured terms. The Company continues to accrue and collect interest on these loans in accordance with the restructured terms. The Company records its allowance for loan losses related to TDRs by discounting the estimated cash flows associated with the respective TDR at the effective interest rate immediately after the loan modification and records any difference between the discounted cash flows and the carrying value as an allowance adjustment. A loan that has been classified as a TDR remains so until the loan is paid off or charged off. A TDR is charged off consistent with the Company's policies for the related loan product. For additional information on the Company's loss recognition policy, see the Company's 2019 Form 10-K. |
Goodwill | Goodwill The annual impairment review for goodwill, performed as of October 1, consists of performing a qualitative assessment to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount as a basis for determining whether or not further testing is required. The Company may elect to bypass the qualitative assessment and proceed directly to the two-step process, for any reporting unit, in any period. The Company can resume the qualitative assessment for any reporting unit in any subsequent period. If the Company determines, on the basis of qualitative factors, that it is more likely than not that the fair value of the reporting unit is less than the carrying amount, the Company will then apply a two-step process of (i) determining the fair value of the reporting unit and (ii) comparing it to the carrying value of the net assets allocated to the reporting unit. When performing the two-step process, if the fair value of the reporting unit exceeds its carrying value, no further analysis or write-down of goodwill is required. In the event the estimated fair value of a reporting unit is less than the carrying value, the Company would recognize an impairment loss equal to such excess, which could significantly and adversely impact reported results of operations and stockholders’ equity. |
Recently Adopted and Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements ASU 2018-15 In August 2018, the FASB issued ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (“ASU 2018-15”). ASU 2018-15 requires implementation costs incurred by customers in cloud computing arrangements to be deferred over the non-cancellable term of the cloud computing arrangements plus any optional renewal periods (i) that are reasonably certain to be exercised by the customer or (ii) for which exercise of the renewal option is controlled by the cloud service provider. The Company adopted ASU 2018-15 on a prospective basis as of January 1, 2020. The adoption of ASU 2018-15 did not have a material impact on the unaudited Condensed Consolidated Financial Statements. ASU 2018-13 In August 2018, the FASB issued ASU 2018-13, Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which amends ASC 820, Fair Value Measurement . ASU 2018-13 modifies the disclosure requirements for fair value measurements by removing, modifying or adding certain disclosures. The Company adopted ASU 2018-13 as of January 1, 2020, which did not have a material impact on the unaudited Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” and subsequent amendments to the guidance: ASU 2018-19 in November 2018, ASU 2019-04 in April 2019, ASU 2019-05 in May 2019, ASU 2019-10 and 11 in November 2019, and ASU 2020-02 in February 2020. The amended standard changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace the current “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For available-for-sale debt securities, entities will be required to record allowances rather than reduce the carrying amount, as they currently do under the other-than-temporary impairment model. The standard also simplifies the accounting model for purchased credit-impaired debt securities and loans. The amendment will affect loans, debt securities, trade receivables, net investments in leases, off-balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2019-04 clarifies that equity instruments without readily determinable fair values for which an entity has elected the measurement alternative should be remeasured to fair value as of the date that an observable transaction occurred. ASU 2019-05 provides an option to irrevocably elect to measure certain individual financial assets at fair value instead of amortized cost. ASU 2019-10 amends the mandatory effective date for ASU 2016-13. The amendments are effective for fiscal years beginning after December 15, 2022 for entities that qualify as an SRC, for which the Company currently qualifies. ASU 2019-11 provides clarity and improves the codification to ASU 2016-13. The amendments should be applied on either a prospective transition or modified-retrospective approach depending on the subtopic. As issued, ASU 2016-13 is effective for annual periods beginning after December 15, 2019, and interim periods therein. Early adoption is permitted. The Company is evaluating its alternatives with respect to the available accounting methods under ASU 2016-13, including the fair value option. If the fair value option is not utilized, adoption of ASU 2016-13 will increase the allowance for credit losses, with a resulting negative adjustment to retained earnings on the date of adoption. The Company deferred the adoption of ASU 2016-13 as permitted under ASU 2019-10. The Company is currently assessing the impact that adoption of ASU 2016-13 will have on its Consolidated Financial Statements. ASU 2020-01 In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (ASU 2020-01). ASU 2020-01 clarifies the interaction of the accounting for equity securities under Topic 321, the accounting for equity method investments in Topic 323, and the accounting for certain forward contracts and purchased options in Topic 815. ASU 2020-01 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company is currently assessing the impact the adoption of ASU 2020-01 will have on its Consolidated Financial Statements. ASU 2020-04 In March 2020, the FASB issued ASU 2020-04, “ Reference Rate Reform - Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ” This ASU provides temporary optional expedients and exceptions to US GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates, such as the Secured Overnight Financing Rate. Entities can elect not to apply certain modification accounting requirements to contracts affected by this reference rate reform, if certain criteria are met. An entity that makes this election would not have to remeasure the contracts at the modification date or reassess a previous accounting determination. Entities can also elect various optional expedients that would allow them to continue applying hedge accounting for hedging relationships affected by reference rate reform, if certain criteria are met. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company is currently assessing the impact that adoption of ASU 2020-04 will have on its Consolidated Financial Statements. In December 2019, the FASB issued ASU 2019-12, “ Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Variable Interest Entity | The Company determined that it is the primary beneficiary of the VIEs and is required to consolidate the entities. The Company includes the assets and liabilities related to the VIEs in the unaudited Condensed Consolidated Balance Sheets. As required, CURO parenthetically discloses on the unaudited Condensed Consolidated Balance Sheets the VIEs' assets that can only be used to settle the VIEs' obligations and liabilities if the VIEs' creditors have no recourse against the Company's general credit. |
Fair Value of Financial Instruments | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. The Company is required to use valuation techniques that are consistent with the market approach, income approach and/or cost approach. Inputs to valuation techniques refer to the assumptions that market participants would use in pricing the asset or liability based on observable market data obtained from independent sources, or unobservable, meaning those that reflect the Company's own estimate about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. Accounting standards establish a three-level fair value hierarchy based upon the assumptions (inputs) used to price assets or liabilities. The hierarchy requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are listed below. Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has access to at the measurement date. Level 2 – Inputs include quoted market prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of the Carrying Amounts of Consolidated VIEs' Assets and Liabilities | The carrying amounts of consolidated VIEs' assets and liabilities associated with the VIE subsidiaries were as follows (in thousands): June 30, December 31, Assets Restricted cash $ 39,248 $ 17,427 Loans receivable less allowance for loan losses 242,840 220,067 Prepaid expenses and other 699 — Total Assets $ 282,787 $ 237,494 Liabilities Accounts payable and accrued liabilities $ 20,567 $ 13,462 Deferred revenue 111 46 Accrued interest 1,030 871 Intercompany payable 57,836 69,639 Debt 120,685 112,221 Total Liabilities $ 200,229 $ 196,239 |
LOANS RECEIVABLE AND REVENUE (T
LOANS RECEIVABLE AND REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Receivables [Abstract] | |
Summary of Revenue by Product | The following table summarizes revenue by product (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Unsecured Installment $ 70,429 $ 122,112 $ 192,838 $ 257,890 Secured Installment 19,401 26,076 45,687 53,553 Open-End 56,736 54,972 127,718 107,841 Single-Pay 22,732 45,528 67,889 92,289 Ancillary 13,211 15,612 29,183 30,666 Total revenue (1) $ 182,509 $ 264,300 $ 463,315 $ 542,239 (1) Includes revenue from CSO programs of $37.8 million and $63.6 million for the three months ended June 30, 2020 and 2019, respectively, and $105.8 million and $127.8 million for the six months ended June 30, 2020 and 2019, respectively. |
Summary of Loans Receivable by Product and Related Delinquent Loans | The following tables summarize loans receivable by product and the related delinquent loans receivable (in thousands): June 30, 2020 Single-Pay (1) Unsecured Installment Secured Installment Open-End Total Current loans receivable $ 36,130 $ 63,835 $ 44,675 $ 253,948 $ 398,588 Delinquent loans receivable — 17,766 8,950 31,208 57,924 Total loans receivable 36,130 81,601 53,625 285,156 456,512 Less: allowance for losses (2,802) (18,451) (7,883) (47,319) (76,455) Loans receivable, net $ 33,328 $ 63,150 $ 45,742 $ 237,837 $ 380,057 (1) Of the $36.1 million of Single-Pay receivables, $8.1 million relate to mandated extended payment options for certain Canada Single-Pay loans. June 30, 2020 Unsecured Installment Secured Installment Open-End Total Delinquent loans receivable 0-30 days past due $ 5,207 $ 3,500 $ 11,743 $ 20,450 31-60 days past due 3,825 2,157 7,225 13,207 61 + days past due 8,734 3,293 12,240 24,267 Total delinquent loans receivable $ 17,766 $ 8,950 $ 31,208 $ 57,924 December 31, 2019 Single-Pay (1) Unsecured Installment Secured Installment Open-End Total Current loans receivable $ 81,447 $ 117,682 $ 70,565 $ 285,452 $ 555,146 Delinquent loans receivable — 43,100 17,510 50,072 110,682 Total loans receivable 81,447 160,782 88,075 335,524 665,828 Less: allowance for losses (5,869) (35,587) (10,305) (55,074) (106,835) Loans receivable, net $ 75,578 $ 125,195 $ 77,770 $ 280,450 $ 558,993 (1) Of the $81.4 million of Single-Pay receivables, $22.4 million relate to mandated extended payment options for certain Canada Single-Pay loans. December 31, 2019 Unsecured Installment Secured Installment Open-End Total Delinquent loans receivable 0-30 days past due $ 15,369 $ 8,039 $ 21,823 $ 45,231 31-60 days past due 12,403 4,885 13,191 30,479 61 + days past due 15,328 4,586 15,058 34,972 Total delinquent loans receivable $ 43,100 $ 17,510 $ 50,072 $ 110,682 The following tables summarize loans guaranteed by the Company under CSO programs and the related delinquent receivables (in thousands): June 30, 2020 Unsecured Installment Secured Installment Total Current loans receivable guaranteed by the Company $ 29,063 $ 887 $ 29,950 Delinquent loans receivable guaranteed by the Company 4,019 123 4,142 Total loans receivable guaranteed by the Company 33,082 1,010 34,092 Less: Liability for losses on CSO lender-owned consumer loans (5,128) (36) (5,164) Loans receivable guaranteed by the Company, net $ 27,954 $ 974 $ 28,928 June 30, 2020 Unsecured Installment Secured Installment Total Delinquent loans receivable 0-30 days past due $ 3,411 $ 104 $ 3,515 31-60 days past due 347 11 358 61+ days past due 261 8 269 Total delinquent loans receivable $ 4,019 $ 123 $ 4,142 December 31, 2019 Unsecured Installment Secured Installment Total Current loans receivable guaranteed by the Company $ 61,840 $ 1,944 $ 63,784 Delinquent loans receivable guaranteed by the Company 12,477 392 12,869 Total loans receivable guaranteed by the Company 74,317 2,336 76,653 Less: Liability for losses on CSO lender-owned consumer loans (10,553) (70) (10,623) Loans receivable guaranteed by the Company, net $ 63,764 $ 2,266 $ 66,030 December 31, 2019 Unsecured Installment Secured Installment Total Delinquent loans receivable 0-30 days past due $ 10,392 $ 326 $ 10,718 31-60 days past due 1,256 40 1,296 61 + days past due 829 26 855 Total delinquent loans receivable $ 12,477 $ 392 $ 12,869 |
Summary of Activity in Allowance for Loan Losses, Credit Services Organization Guarantee Liability | The following tables summarize activity in the allowance for loan losses and the liability for losses on CSO lender-owned consumer loans in total (in thousands): Three Months Ended June 30, 2020 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 4,693 $ 28,965 $ 9,726 $ 56,458 $ — $ 99,842 Charge-offs (21,168) (30,129) (11,747) (37,784) (750) (101,578) Recoveries 21,766 7,019 2,961 6,100 398 38,244 Net charge-offs 598 (23,110) (8,786) (31,684) (352) (63,334) Provision for losses (2,588) 12,584 6,943 21,341 352 38,632 Effect of foreign currency translation 99 12 — 1,204 — 1,315 Balance, end of period $ 2,802 $ 18,451 $ 7,883 $ 47,319 $ — $ 76,455 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 9,142 $ 47 $ — $ — $ 9,189 Decrease in liability — 4,014 11 — — 4,025 Balance, end of period $ — $ 5,128 $ 36 $ — $ — $ 5,164 Three Months Ended June 30, 2019 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 3,897 $ 33,666 $ 9,796 $ 46,963 $ — $ 94,322 Charge-offs (35,759) (37,336) (10,295) (30,688) (1,342) (115,420) Recoveries 24,301 5,366 2,693 5,537 822 38,719 Net charge-offs (11,458) (31,970) (7,602) (25,151) (520) (76,701) Provision for losses 12,446 33,514 7,802 29,373 520 83,655 Effect of foreign currency translation 56 13 — 532 — 601 Balance, end of period $ 4,941 $ 35,223 $ 9,996 $ 51,717 $ — $ 101,877 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 8,583 $ 78 $ — $ — $ 8,661 Increase in liability — (850) 7 — — (843) Balance, end of period $ — $ 9,433 $ 71 $ — $ — $ 9,504 Six Months Ended June 30, 2020 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 5,869 $ 35,587 $ 10,305 $ 55,074 $ — $ 106,835 Charge-offs (61,689) (68,687) (24,857) (81,293) (2,028) (238,554) Recoveries 51,770 12,802 5,870 12,511 977 83,930 Net charge-offs (9,919) (55,885) (18,987) (68,782) (1,051) (154,624) Provision for losses 7,051 38,766 16,565 62,332 1,051 125,765 Effect of foreign currency translation (199) (17) — (1,305) — (1,521) Balance, end of period $ 2,802 $ 18,451 $ 7,883 $ 47,319 $ — $ 76,455 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 10,553 $ 70 $ — $ — $ 10,623 Decrease in liability — 5,425 34 — — 5,459 Balance, end of period $ — $ 5,128 $ 36 $ — $ — $ 5,164 Six Months Ended June 30, 2019 Single-Pay Unsecured Installment Secured Installment Open-End Other Total Allowance for loan losses: Balance, beginning of period $ 4,189 $ 37,716 $ 12,191 $ 19,901 $ — $ 73,997 Charge-offs (72,280) (81,573) (22,966) (34,326) (2,693) (213,838) Recoveries 52,212 11,684 5,816 10,696 1,721 82,129 Net charge-offs (20,068) (69,889) (17,150) (23,630) (972) (131,709) Provision for losses 20,714 67,359 14,955 54,690 972 158,690 Effect of foreign currency translation 106 37 — 756 — 899 Balance, end of period $ 4,941 $ 35,223 $ 9,996 $ 51,717 $ — $ 101,877 Liability for losses on CSO lender-owned consumer loans: Balance, beginning of period $ — $ 11,582 $ 425 $ — $ — $ 12,007 Decrease (increase) in liability — 2,149 354 — — 2,503 Balance, end of period $ — $ 9,433 $ 71 $ — $ — $ 9,504 |
Financing Receivable, Troubled Debt Restructuring | The table below presents TDRs included in gross loans receivable and the impairment included in the allowance for loan losses (in thousands): As of Current TDR gross receivables $ 13,803 Delinquent TDR gross receivables 6,534 Total TDR gross receivables 20,337 Less: Impairment included in the allowance for loan losses (9,043) Outstanding TDR receivables, net of impairment $ 11,294 The tables below reflect new loans modified and classified as TDRs during the periods presented (in thousands): Three and Six Months Ended June 30, 2020 Pre-modification TDR loans receivable $ 24,069 Post-modification TDR loans receivable 21,390 Total concessions included in gross charge-offs $ 2,679 The table below presents the Company's average outstanding TDR loans receivable and interest income recognized on TDR loans for the three and six months ended June 30, 2020 (in thousands): Three and Six Months Ended June 30, 2020 Average outstanding TDR loans receivable (1) $ 20,864 Interest income recognized 4,396 Number of TDR loans (2) 21,512 (1) As there were no TDRs prior to April 1, 2020, the average outstanding TDR loans receivable is calculated based on the amount immediately after the loan was classified as a TDR and the ending TDR balance as of June 30, 2020. (2) Presented in ones |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Debt consisted of the following (in thousands): June 30, 2020 December 31, 2019 8.25% Senior Secured Notes (due 2025) $ 679,143 $ 678,323 Non-Recourse U.S. SPV Facility 31,896 — Non-Recourse Canada SPV Facility 88,789 112,221 Debt $ 799,828 $ 790,544 |
SHARE-BASED COMPENSATION Tables
SHARE-BASED COMPENSATION Tables (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Restricted Stock Activity | A summary of the activity of time-based and market-based unvested RSUs as of June 30, 2020 and changes during the six months ended June 30, 2020 are presented in the following table: Number of RSUs Time-Based Market-Based Weighted Average December 31, 2019 1,061,753 394,861 $ 11.47 Granted 679,413 368,539 10.42 Vested (307,142) — 11.34 Forfeited (24,025) (4,687) 11.99 June 30, 2020 1,409,999 758,713 $ 10.97 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Not Measured at Fair Value | The table below presents the assets and liabilities that were carried at fair value on the unaudited Condensed Consolidated Balance Sheets at June 30, 2020 (in thousands): Estimated Fair Value Carrying Value June 30, Level 1 Level 2 Level 3 Total Financial assets: Cash Surrender Value of Life Insurance $ 6,409 $ 6,409 $ — $ — $ 6,409 Financial liabilities: Non-qualified deferred compensation plan $ 4,292 $ 4,292 $ — $ — $ 4,292 The table below presents the assets and liabilities that were carried at fair value on the unaudited Condensed Consolidated Balance Sheets at December 31, 2019 (in thousands): Estimated Fair Value Carrying Value December 31, Level 1 Level 2 Level 3 Total Financial assets: Cash Surrender Value of Life Insurance $ 6,171 $ 6,171 $ — $ — $ 6,171 Financial liabilities: Non-qualified deferred compensation plan $ 4,666 $ 4,666 $ — $ — $ 4,666 The table below presents the assets and liabilities that were not carried at fair value on the unaudited Condensed Consolidated Balance Sheets at June 30, 2020 (in thousands): Estimated Fair Value Carrying Value June 30, Level 1 Level 2 Level 3 Total Financial assets: Cash and cash equivalents $ 269,342 $ 269,342 $ — $ — $ 269,342 Restricted cash 63,274 63,274 — — 63,274 Loans receivable, net 380,057 — — 380,057 380,057 Equity method investment 9,191 — — 9,191 9,191 Financial liabilities: Liability for losses on CSO lender-owned consumer loans $ 5,164 $ — $ — $ 5,164 $ 5,164 8.25% Senior Secured Notes 679,143 — 543,111 — 543,111 Non-Recourse U.S. SPV facility 31,896 — — 35,206 35,206 Non-Recourse Canada SPV facility 88,789 — — 91,109 91,109 The table below presents the assets and liabilities that were not carried at fair value on the unaudited Condensed Consolidated Balance Sheets at December 31, 2019 (in thousands): Estimated Fair Value Carrying Value December 31, Level 1 Level 2 Level 3 Total Financial assets: Cash and cash equivalents $ 75,242 $ 75,242 $ — $ — $ 75,242 Restricted cash 34,779 34,779 — — 34,779 Loans receivable, net 558,993 — — 558,993 558,993 Equity method investment 10,068 — — 10,068 10,068 Financial liabilities: Liability for losses on CSO lender-owned consumer loans $ 10,623 $ — $ — $ 10,623 $ 10,623 8.25% Senior Secured Notes 678,323 — 596,924 — 596,924 Non-Recourse Canada SPV facility 112,221 — — 115,243 115,243 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Equity [Abstract] | |
Schedule of Stockholders Equity | The following table summarizes the changes in stockholders' equity for the three and six months ended June 30, 2020 and 2019 (in thousands): Common Stock Treasury Stock Paid-in capital Retained Earnings (Deficit) AOCI (1) Total Stockholders' Equity Shares Outstanding Par Value Balances at December 31, 2019 41,156,224 $ 9 $ (72,343) $ 68,087 $ 93,423 $ (38,663) $ 50,513 Net income from continuing operations — — — — 36,013 — 36,013 Net income from discontinued operations — — — — 292 — 292 Foreign currency translation adjustment — — — — — (22,193) (22,193) Dividends — — — — (2,256) — — (2,256) Share based compensation expense — — — 3,194 — — 3,194 Proceeds from exercise of stock options 42,094 — — 126 — — 126 Repurchase of common stock (540,762) — (5,509) — — — (5,509) Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 121,891 — — (609) — — (609) Balances at March 31, 2020 40,779,447 $ 9 $ (77,852) $ 70,798 $ 127,472 $ (60,856) $ 59,571 Net income from continuing operations — — — — 21,080 — 21,080 Net income from discontinued operations — — — — 993 — 993 Foreign currency translation adjustment — — — — — 10,261 10,261 Dividends — — — — (2,244) — (2,244) Share based compensation expense — — — 3,310 — — 3,310 Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 105,098 — — (29) — — (29) Balances at June 30, 2020 40,884,545 $ 9 $ (77,852) $ 74,079 $ 147,301 $ (50,595) $ 92,942 (1) Accumulated other comprehensive income (loss) Common Stock Treasury Stock Paid-in capital Retained Earnings (Deficit) AOCI (1) Total Stockholders' Equity (Deficit) Shares Outstanding Par Value Balances at December 31, 2018 46,412,231 $ 9 $ — $ 60,015 $ (18,065) $ (61,060) $ (19,101) Net income from continuing operations — — — — 28,673 — 28,673 Net income from discontinued operations — — — — 8,375 — 8,375 Foreign currency translation adjustment — — — — — 16,695 16,695 Share based compensation expense — — — 2,172 — — 2,172 Proceeds from exercise of stock options 7,888 — — 40 — — 40 Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 11,170 — — (110) — — (110) Balances at March 31, 2019 46,431,289 $ 9 $ — $ 62,117 $ 18,983 $ (44,365) $ 36,744 Net income from continuing operations — — — — 17,667 — 17,667 Net loss from discontinued operations — — — — (834) — (834) Foreign currency translation adjustment — — — — — 3,635 3,635 Share based compensation expense — — — 2,644 — — 2,644 Proceeds from exercise of stock options 4,908 — — 29 — — 29 Repurchase of common stock (244,200) — (2,507) — — — (2,507) Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes 63,285 — — — — — — Balances at June 30, 2019 46,255,282 $ 9 $ (2,507) $ 64,790 $ 35,816 $ (40,730) $ 57,378 (1) Accumulated other comprehensive income (loss) |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the computation of basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended Six Months Ended 2020 2019 2020 2019 Net income from continuing operations $ 21,080 $ 17,667 $ 57,093 $ 46,340 Net income (loss) from discontinued operations, net of tax 993 (834) 1,285 7,541 Net income $ 22,073 $ 16,833 $ 58,378 $ 53,881 Weighted average common shares - basic 40,810 46,451 40,814 46,438 Dilutive effect of stock options and restricted stock units 735 656 872 897 Weighted average common shares - diluted 41,545 47,107 41,686 47,335 Basic earnings (loss) per share: Continuing operations $ 0.52 $ 0.38 $ 1.40 $ 1.00 Discontinued operations 0.02 (0.02) 0.03 0.16 Basic earnings per share $ 0.54 $ 0.36 $ 1.43 $ 1.16 Diluted earnings (loss) per share: Continuing operations $ 0.51 $ 0.38 $ 1.37 $ 0.98 Discontinued operations 0.02 (0.02) 0.03 0.16 Diluted earnings per share $ 0.53 $ 0.36 $ 1.40 $ 1.14 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow Information | The following table provides supplemental cash flow information (in thousands): Six Months Ended 2020 2019 Cash paid for: Interest $ 34,125 $ 34,678 Income taxes, net of refunds 1,133 4,231 Non-cash investing activities: Property and equipment accrued in accounts payable and accrued liabilities $ 117 $ 105 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Summary of Financial Information by Segment | The following table illustrates summarized financial information concerning reportable segments (in thousands): Three Months Ended Six Months Ended 2020 2019 2020 2019 Revenues by segment: (1) U.S. $ 137,320 $ 210,046 $ 359,088 $ 436,165 Canada 45,189 54,254 104,227 106,074 Consolidated revenue $ 182,509 $ 264,300 $ 463,315 $ 542,239 Net revenues by segment: U.S. $ 95,790 $ 117,494 $ 231,517 $ 258,633 Canada 36,026 34,796 $ 67,569 69,211 Consolidated net revenue $ 131,816 $ 152,290 $ 299,086 $ 327,844 Gross margin by segment: U.S. $ 56,860 $ 65,067 $ 144,400 $ 154,870 Canada 19,639 16,114 31,798 31,808 Consolidated gross margin $ 76,499 $ 81,181 $ 176,198 $ 186,678 Segment operating income: U.S. $ 11,857 $ 17,029 $ 45,283 $ 48,224 Canada 10,291 8,091 14,815 15,615 Consolidated operating income $ 22,148 $ 25,120 $ 60,098 $ 63,839 Expenditures for long-lived assets by segment: U.S. $ 248 $ 2,568 $ 4,528 $ 4,998 Canada 144 477 697 1,166 Consolidated expenditures for long-lived assets $ 392 $ 3,045 $ 5,225 $ 6,164 (1) For revenue by product, see Note 3, "Loans Receivable and Revenue." The following table provides the proportion of gross loans receivable by segment (in thousands): June 30, December 31, U.S. $ 199,734 $ 363,453 Canada 256,778 302,375 Total gross loans receivable $ 456,512 $ 665,828 |
Summary of Long-lived Assets by Geographic Region | The following table represents the Company's net long-lived assets, comprised of property and equipment, by segment. These amounts are aggregated on a legal entity basis and do not necessarily reflect where the asset is physically located (in thousands): June 30, December 31, U.S. $ 39,974 $ 43,618 Canada 24,285 27,193 Total net long-lived assets $ 64,259 $ 70,811 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Leases [Abstract] | |
Summary of Operating Lease Costs | The following table summarizes the operating lease costs and other information for the three and six months ended June 30, 2020 and June 30, 2019 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Operating lease costs: Third-Party $ 7,576 $ 7,608 $ 15,221 $ 15,246 Related-Party 845 865 1,691 1,741 Total operating lease costs $ 8,421 $ 8,473 $ 16,912 $ 16,987 Operating cash flow - Operating leases $ 16,545 $ 17,420 New ROU assets - Operating leases $ 6,922 $ 9,468 Weighted average remaining lease term - Operating leases 6.1 years 6.3 years Weighted average discount rate - Operating leases 10.3 % 10.3 % |
Summary of Future Minimum Lease Payments, ASC 842 | The following table summarizes the aggregate operating lease maturities that the Company is contractually obligated to make under operating leases as of June 30, 2020 (in thousands): Third-Party Related-Party Total Remainder of 2020 $ 15,334 $ 1,839 $ 17,173 2021 28,475 3,763 32,238 2022 25,638 3,663 29,301 2023 20,836 1,319 22,155 2024 15,911 964 16,875 2025 11,492 864 12,356 Thereafter 30,676 2,661 33,337 Total 148,362 15,073 163,435 Less: Imputed interest (40,146) (3,522) (43,668) Operating lease liabilities $ 108,216 $ 11,551 $ 119,767 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The following table presents the results of operations of the U.K. Subsidiaries, which meet the criteria of Discontinued Operations and, therefore, are excluded from the Company's results of continuing operations (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 (1) Revenue $ — $ — $ — $ 6,957 Provision for losses — — — 1,703 Net revenue — — — 5,254 Cost of providing services Office — — — 246 Other costs of providing services — — — 61 Advertising — — — 775 Total cost of providing services — — — 1,082 Gross margin — — — 4,172 Operating (income) expense Corporate, district and other expenses — — — 3,810 Interest income — — — (4) (Gain) loss on disposition (1,324) — (1,714) 39,414 Total operating (income) expense (1,324) — (1,714) 43,220 Pre-tax income (loss) from operations of discontinued operations 1,324 — 1,714 (39,048) Income tax expense (benefit) related to disposition 331 834 429 (46,589) Net income (loss) from discontinued operations $ 993 $ (834) $ 1,285 $ 7,541 (1) Includes U.K. Subsidiaries financial results from January 1, 2019 to February 25, 2019. The following table presents cash flows of the U.K. Subsidiaries (in thousands): Six Months Ended June 30, 2020 2019 (1) Net cash provided by (used in) discontinued operating activities $ 1,714 $ (504) Net cash used in discontinued investing activities — (14,213) Net cash used in discontinued financing activities — — (1) Includes U.K. Subsidiaries financial results from January 1, 2019 to February 25, 2019. |
GOODWILL (Tables)
GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The change in the carrying amount of goodwill by operating segment for the six months ended June 30, 2020 was as follows (in thousands): U.S. Canada Total Goodwill at December 31, 2019 $ 91,131 $ 29,478 $ 120,609 Acquisition (Note 17) 14,791 — 14,791 Foreign currency translation — (1,423) (1,423) Goodwill at June 30, 2020 $ 105,922 $ 28,055 $ 133,977 |
ACQUISITION (Tables)
ACQUISITION (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the allocation of the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition: (in thousands) Amounts acquired on January 3, 2020 Cash consideration transferred: $ 17,811 Cash and cash equivalents 3,360 Accounts receivable 465 Property and equipment 358 Intangible assets 1,101 Goodwill 14,791 Operating lease asset 235 Accounts payable and accrued liabilities (2,264) Operating lease liabilities (235) Total $ 17,811 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS - Narrative (Details) $ in Thousands | Jan. 03, 2020USD ($) | Dec. 31, 2019reporting_unit | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Acquisition of Ad Astra, net of cash received | $ 14,418 | $ 0 | ||
Number of reporting units | reporting_unit | 2 | |||
Katapult | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Ownership percentage | 42.50% | |||
Ad Astra | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Equity interests acquired | 100.00% | |||
Acquisition of Ad Astra, net of cash received | $ 14,400 |
VARIABLE INTEREST ENTITIES - Ca
VARIABLE INTEREST ENTITIES - Carrying Amounts of Consolidated VIE Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
Assets | |||
Restricted cash | $ 63,274 | $ 34,779 | $ 33,712 |
Loans receivable less allowance for loan losses | 380,057 | 558,993 | |
Prepaid expenses and other | 32,860 | 35,890 | |
Total Assets | 1,127,159 | 1,081,895 | |
Liabilities | |||
Accounts payable and accrued liabilities | 63,960 | 60,083 | |
Deferred revenue | 4,974 | 10,170 | |
Accrued interest | 20,005 | 19,847 | |
Debt | 799,828 | 790,544 | |
Total Liabilities | 1,034,217 | 1,031,382 | |
Variable Interest Entity | |||
Assets | |||
Restricted cash | 39,248 | 17,427 | $ 14,819 |
Loans receivable less allowance for loan losses | 242,840 | 220,067 | |
Prepaid expenses and other | 699 | 0 | |
Total Assets | 282,787 | 237,494 | |
Liabilities | |||
Accounts payable and accrued liabilities | 20,567 | 13,462 | |
Deferred revenue | 111 | 46 | |
Accrued interest | 1,030 | 871 | |
Intercompany payable | 57,836 | 69,639 | |
Debt | 120,685 | 112,221 | |
Total Liabilities | $ 200,229 | $ 196,239 |
LOANS RECEIVABLE AND REVENUE -
LOANS RECEIVABLE AND REVENUE - Revenue by Product (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenue from External Customer [Line Items] | ||||
Revenue | $ 182,509 | $ 264,300 | $ 463,315 | $ 542,239 |
Credit Services Organization Programs | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 37,800 | 63,600 | 105,800 | 127,800 |
Consumer Portfolio Segment | Unsecured Installment | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 70,429 | 122,112 | 192,838 | 257,890 |
Consumer Portfolio Segment | Secured Installment | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 19,401 | 26,076 | 45,687 | 53,553 |
Consumer Portfolio Segment | Open-End | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 56,736 | 54,972 | 127,718 | 107,841 |
Consumer Portfolio Segment | Single-Pay | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | 22,732 | 45,528 | 67,889 | 92,289 |
Ancillary | ||||
Revenue from External Customer [Line Items] | ||||
Revenue | $ 13,211 | $ 15,612 | $ 29,183 | $ 30,666 |
LOANS RECEIVABLE AND REVENUE _2
LOANS RECEIVABLE AND REVENUE - Loans Receivable by Product and Delinquency (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current loans receivable | $ 398,588 | $ 555,146 |
Delinquent loans receivable | 57,924 | 110,682 |
Total loans receivable | 456,512 | 665,828 |
Less: allowance for losses | (76,455) | (106,835) |
Loans receivable, net | 380,057 | 558,993 |
Consumer Portfolio Segment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Delinquent loans receivable | 57,924 | 110,682 |
Consumer Portfolio Segment | Single-Pay | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current loans receivable | 36,130 | 81,447 |
Delinquent loans receivable | 0 | 0 |
Total loans receivable | 36,130 | 81,447 |
Less: allowance for losses | (2,802) | (5,869) |
Loans receivable, net | 33,328 | 75,578 |
Consumer Portfolio Segment | Single-Pay | Canada | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total loans receivable | 8,100 | 22,400 |
Consumer Portfolio Segment | Unsecured Installment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current loans receivable | 63,835 | 117,682 |
Delinquent loans receivable | 17,766 | 43,100 |
Total loans receivable | 81,601 | 160,782 |
Less: allowance for losses | (18,451) | (35,587) |
Loans receivable, net | 63,150 | 125,195 |
Consumer Portfolio Segment | Secured Installment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current loans receivable | 44,675 | 70,565 |
Delinquent loans receivable | 8,950 | 17,510 |
Total loans receivable | 53,625 | 88,075 |
Less: allowance for losses | (7,883) | (10,305) |
Loans receivable, net | 45,742 | 77,770 |
Consumer Portfolio Segment | Open-End | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Current loans receivable | 253,948 | 285,452 |
Delinquent loans receivable | 31,208 | 50,072 |
Total loans receivable | 285,156 | 335,524 |
Less: allowance for losses | (47,319) | (55,074) |
Loans receivable, net | $ 237,837 | $ 280,450 |
LOANS RECEIVABLE AND REVENUE _3
LOANS RECEIVABLE AND REVENUE - Delinquent Loans - Aging Analysis (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | $ 57,924 | $ 110,682 |
Consumer Portfolio Segment | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 57,924 | 110,682 |
Consumer Portfolio Segment | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 20,450 | 45,231 |
Consumer Portfolio Segment | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 13,207 | 30,479 |
Consumer Portfolio Segment | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 24,267 | 34,972 |
Consumer Portfolio Segment | Unsecured Installment | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 17,766 | 43,100 |
Consumer Portfolio Segment | Unsecured Installment | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 5,207 | 15,369 |
Consumer Portfolio Segment | Unsecured Installment | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 3,825 | 12,403 |
Consumer Portfolio Segment | Unsecured Installment | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 8,734 | 15,328 |
Consumer Portfolio Segment | Secured Installment | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 8,950 | 17,510 |
Consumer Portfolio Segment | Secured Installment | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 3,500 | 8,039 |
Consumer Portfolio Segment | Secured Installment | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 2,157 | 4,885 |
Consumer Portfolio Segment | Secured Installment | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 3,293 | 4,586 |
Consumer Portfolio Segment | Open-End | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 31,208 | 50,072 |
Consumer Portfolio Segment | Open-End | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 11,743 | 21,823 |
Consumer Portfolio Segment | Open-End | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | 7,225 | 13,191 |
Consumer Portfolio Segment | Open-End | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable | $ 12,240 | $ 15,058 |
LOANS RECEIVABLE AND REVENUE _4
LOANS RECEIVABLE AND REVENUE - Loans Receivable by Product, Credit Services Organization (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Current loans receivable guaranteed by the Company | $ 29,950 | $ 63,784 | ||||
Delinquent loans receivable guaranteed by the Company | 4,142 | 12,869 | ||||
Total loans receivable guaranteed by the Company | 34,092 | 76,653 | ||||
Less: Liability for losses on CSO lender-owned consumer loans | (5,164) | (10,623) | ||||
Loans receivable guaranteed by the Company, net | 28,928 | 66,030 | ||||
Consumer Portfolio Segment | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Delinquent loans receivable guaranteed by the Company | 4,142 | 12,869 | ||||
Less: Liability for losses on CSO lender-owned consumer loans | (5,164) | $ (9,189) | (10,623) | $ (9,504) | $ (8,661) | $ (12,007) |
Consumer Portfolio Segment | Unsecured Installment | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Current loans receivable guaranteed by the Company | 29,063 | 61,840 | ||||
Delinquent loans receivable guaranteed by the Company | 4,019 | 12,477 | ||||
Total loans receivable guaranteed by the Company | 33,082 | 74,317 | ||||
Less: Liability for losses on CSO lender-owned consumer loans | (5,128) | (9,142) | (10,553) | (9,433) | (8,583) | (11,582) |
Loans receivable guaranteed by the Company, net | 27,954 | 63,764 | ||||
Consumer Portfolio Segment | Secured Installment | ||||||
Loans and Leases Receivable Disclosure [Line Items] | ||||||
Current loans receivable guaranteed by the Company | 887 | 1,944 | ||||
Delinquent loans receivable guaranteed by the Company | 123 | 392 | ||||
Total loans receivable guaranteed by the Company | 1,010 | 2,336 | ||||
Less: Liability for losses on CSO lender-owned consumer loans | (36) | $ (47) | (70) | $ (71) | $ (78) | $ (425) |
Loans receivable guaranteed by the Company, net | $ 974 | $ 2,266 |
LOANS RECEIVABLE AND REVENUE _5
LOANS RECEIVABLE AND REVENUE - Delinquent Loans, Credit Services Organization - Aging Analysis (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | $ 4,142 | $ 12,869 |
Consumer Portfolio Segment | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 4,142 | 12,869 |
Consumer Portfolio Segment | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 3,515 | 10,718 |
Consumer Portfolio Segment | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 358 | 1,296 |
Consumer Portfolio Segment | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 269 | 855 |
Consumer Portfolio Segment | Unsecured Installment | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 4,019 | 12,477 |
Consumer Portfolio Segment | Unsecured Installment | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 3,411 | 10,392 |
Consumer Portfolio Segment | Unsecured Installment | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 347 | 1,256 |
Consumer Portfolio Segment | Unsecured Installment | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 261 | 829 |
Consumer Portfolio Segment | Secured Installment | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 123 | 392 |
Consumer Portfolio Segment | Secured Installment | 0-30 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 104 | 326 |
Consumer Portfolio Segment | Secured Installment | 31-60 days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | 11 | 40 |
Consumer Portfolio Segment | Secured Installment | 61 + days past due | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Delinquent loans receivable guaranteed by the Company | $ 8 | $ 26 |
LOANS RECEIVABLE AND REVENUE _6
LOANS RECEIVABLE AND REVENUE - Allowance For Doubtful Accounts - CSO Guarantee Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Allowance for loan losses: | ||||
Provision for losses | $ 50,693 | $ 112,010 | $ 164,229 | $ 214,395 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 10,623 | |||
Balance, end of period | 5,164 | 5,164 | ||
Consumer Portfolio Segment | ||||
Allowance for loan losses: | ||||
Balance, beginning of period | 99,842 | 94,322 | 106,835 | 73,997 |
Charge-offs | (101,578) | (115,420) | (238,554) | (213,838) |
Recoveries | 38,244 | 38,719 | 83,930 | 82,129 |
Net charge-offs | (63,334) | (76,701) | (154,624) | (131,709) |
Provision for losses | 38,632 | 83,655 | 125,765 | 158,690 |
Effect of foreign currency translation | 1,315 | 601 | (1,521) | 899 |
Balance, end of period | 76,455 | 101,877 | 76,455 | 101,877 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 9,189 | 8,661 | 10,623 | 12,007 |
Decrease (increase) in liability | 4,025 | (843) | 5,459 | 2,503 |
Balance, end of period | 5,164 | 9,504 | 5,164 | 9,504 |
Consumer Portfolio Segment | Single-Pay | ||||
Allowance for loan losses: | ||||
Balance, beginning of period | 4,693 | 3,897 | 5,869 | 4,189 |
Charge-offs | (21,168) | (35,759) | (61,689) | (72,280) |
Recoveries | 21,766 | 24,301 | 51,770 | 52,212 |
Net charge-offs | 598 | (11,458) | (9,919) | (20,068) |
Provision for losses | (2,588) | 12,446 | 7,051 | 20,714 |
Effect of foreign currency translation | 99 | 56 | (199) | 106 |
Balance, end of period | 2,802 | 4,941 | 2,802 | 4,941 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 0 | 0 | 0 | 0 |
Decrease (increase) in liability | 0 | 0 | 0 | 0 |
Balance, end of period | 0 | 0 | 0 | 0 |
Consumer Portfolio Segment | Unsecured Installment | ||||
Allowance for loan losses: | ||||
Balance, beginning of period | 28,965 | 33,666 | 35,587 | 37,716 |
Charge-offs | (30,129) | (37,336) | (68,687) | (81,573) |
Recoveries | 7,019 | 5,366 | 12,802 | 11,684 |
Net charge-offs | (23,110) | (31,970) | (55,885) | (69,889) |
Provision for losses | 12,584 | 33,514 | 38,766 | 67,359 |
Effect of foreign currency translation | 12 | 13 | (17) | 37 |
Balance, end of period | 18,451 | 35,223 | 18,451 | 35,223 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 9,142 | 8,583 | 10,553 | 11,582 |
Decrease (increase) in liability | 4,014 | (850) | 5,425 | 2,149 |
Balance, end of period | 5,128 | 9,433 | 5,128 | 9,433 |
Consumer Portfolio Segment | Secured Installment | ||||
Allowance for loan losses: | ||||
Balance, beginning of period | 9,726 | 9,796 | 10,305 | 12,191 |
Charge-offs | (11,747) | (10,295) | (24,857) | (22,966) |
Recoveries | 2,961 | 2,693 | 5,870 | 5,816 |
Net charge-offs | (8,786) | (7,602) | (18,987) | (17,150) |
Provision for losses | 6,943 | 7,802 | 16,565 | 14,955 |
Effect of foreign currency translation | 0 | 0 | 0 | 0 |
Balance, end of period | 7,883 | 9,996 | 7,883 | 9,996 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 47 | 78 | 70 | 425 |
Decrease (increase) in liability | 11 | 7 | 34 | 354 |
Balance, end of period | 36 | 71 | 36 | 71 |
Consumer Portfolio Segment | Open-End | ||||
Allowance for loan losses: | ||||
Balance, beginning of period | 56,458 | 46,963 | 55,074 | 19,901 |
Charge-offs | (37,784) | (30,688) | (81,293) | (34,326) |
Recoveries | 6,100 | 5,537 | 12,511 | 10,696 |
Net charge-offs | (31,684) | (25,151) | (68,782) | (23,630) |
Provision for losses | 21,341 | 29,373 | 62,332 | 54,690 |
Effect of foreign currency translation | 1,204 | 532 | (1,305) | 756 |
Balance, end of period | 47,319 | 51,717 | 47,319 | 51,717 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 0 | 0 | 0 | 0 |
Decrease (increase) in liability | 0 | 0 | 0 | 0 |
Balance, end of period | 0 | 0 | 0 | 0 |
Consumer Portfolio Segment | Other | ||||
Allowance for loan losses: | ||||
Balance, beginning of period | 0 | 0 | 0 | 0 |
Charge-offs | (750) | (1,342) | (2,028) | (2,693) |
Recoveries | 398 | 822 | 977 | 1,721 |
Net charge-offs | (352) | (520) | (1,051) | (972) |
Provision for losses | 352 | 520 | 1,051 | 972 |
Effect of foreign currency translation | 0 | 0 | 0 | 0 |
Balance, end of period | 0 | 0 | 0 | 0 |
Liability for losses on CSO lender-owned consumer loans: | ||||
Balance, beginning of period | 0 | 0 | 0 | 0 |
Decrease (increase) in liability | 0 | 0 | 0 | 0 |
Balance, end of period | $ 0 | $ 0 | $ 0 | $ 0 |
LOANS RECEIVABLE AND REVENUE _7
LOANS RECEIVABLE AND REVENUE - TDR Loans Receivable (Details) - Consumer Portfolio Segment - Credit Services Organization Programs $ in Thousands | Jun. 30, 2020USD ($) |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Current TDR gross receivables | $ 13,803 |
Delinquent TDR gross receivables | 6,534 |
Total TDR gross receivables | 20,337 |
Less: Impairment included in the allowance for loan losses | (9,043) |
Outstanding TDR receivables, net of impairment | $ 11,294 |
LOANS RECEIVABLE AND REVENUE _8
LOANS RECEIVABLE AND REVENUE - New Loans Modified and Classified as TDRs (Details) - Consumer Portfolio Segment - Credit Services Organization Programs - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||
Pre-modification TDR loans receivable | $ 24,069 | $ 24,069 |
Post-modification TDR loans receivable | 21,390 | 21,390 |
Total concessions included in gross charge-offs | $ 2,679 | $ 2,679 |
LOANS RECEIVABLE AND REVENUE _9
LOANS RECEIVABLE AND REVENUE - Outstanding TDR Loans Receivable and Interest Income (Details) - Credit Services Organization Programs - Consumer Portfolio Segment $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2020USD ($) | Mar. 31, 2020numberOfContracts | Jun. 30, 2019numberOfContracts | Jun. 30, 2020USD ($) | Jun. 30, 2019numberOfContracts | Dec. 31, 2019numberOfContracts | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||||
Average outstanding TDR loans receivable | $ 20,864 | $ 20,864 | ||||
Interest income recognized | $ 4,396 | $ 4,396 | ||||
Number of TDR loans | 21,512 | 0 | 0 | 21,512 | 0 | 0 |
LOANS RECEIVABLE AND REVENUE_10
LOANS RECEIVABLE AND REVENUE - Narrative (Details) - Consumer Portfolio Segment $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2020USD ($) | Mar. 31, 2020numberOfContracts | Jun. 30, 2019numberOfContracts | Jun. 30, 2020USD ($) | Jun. 30, 2019numberOfContracts | Dec. 31, 2019USD ($)numberOfContracts | |
Installment | ||||||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||||
Loans classified as nonaccrual | $ 8,900 | $ 8,900 | $ 16,600 | |||
Open-End | ||||||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||||
Loans classified as nonaccrual | $ 5,300 | $ 5,300 | $ 7,900 | |||
Credit Services Organization Programs | ||||||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||||
Number of TDR loans | 21,512 | 0 | 0 | 21,512 | 0 | 0 |
TDRs that were charged off | $ 900 | $ 900 | ||||
Credit Services Organization Programs | Open-End | ||||||
Financing Receivable, Troubled Debt Restructuring [Line Items] | ||||||
Commitment to lend additional funds | $ 1,800 | $ 1,800 |
CREDIT SERVICES ORGANIZATION (D
CREDIT SERVICES ORGANIZATION (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Loans and Leases Receivable Disclosure [Line Items] | ||
Credit services organization, fees receivable | $ 3,800 | $ 14,700 |
Guarantor obligations, maximum exposure, undiscounted | 28,600 | 62,700 |
Liability for losses on CSO lender-owned consumer loans | 5,164 | 10,623 |
Amounts placed in collateral accounts | $ 3,400 | $ 6,200 |
Maximum | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
CSO program loan terms | 6 months |
DEBT - Schedule of Long Term De
DEBT - Schedule of Long Term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Aug. 31, 2018 | Aug. 02, 2018 |
Debt Instrument [Line Items] | ||||
Debt | $ 799,828 | $ 790,544 | ||
Senior Notes | 8.25% Senior Secured Notes | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (as percent) | 8.25% | 8.25% | 8.25% | |
Debt | $ 679,143 | $ 678,323 | ||
Line of Credit | Revolving Credit Facility | Non-Recourse U.S. SPV facility | ||||
Debt Instrument [Line Items] | ||||
Debt | 31,896 | 0 | ||
Line of Credit | Revolving Credit Facility | Non-Recourse Canada SPV Facility | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (as percent) | 6.75% | |||
Debt | $ 88,789 | $ 112,221 |
DEBT - Senior Secured Notes (De
DEBT - Senior Secured Notes (Details) - Senior Notes - 8.25% Senior Secured Notes - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 | Aug. 31, 2018 |
Line of Credit Facility [Line Items] | |||
Stated interest rate (as percent) | 8.25% | 8.25% | 8.25% |
Debt instrument, face amount | $ 690,000,000 | ||
Debt issuance costs capitalized | $ 10,900,000 |
DEBT - Non-Recourse U.S. SPV Fa
DEBT - Non-Recourse U.S. SPV Facility (Details) $ in Thousands | Oct. 01, 2020 | Apr. 30, 2020CAD ($) | Mar. 09, 2022 | Mar. 08, 2022 | Sep. 07, 2021 | Jun. 30, 2020USD ($) | Dec. 31, 2019USD ($) |
Debt Instrument [Line Items] | |||||||
Debt | $ 799,828 | $ 790,544 | |||||
Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Credit facility, expansion capacity | $ 200,000,000 | ||||||
Initial advance rate (as percent) | 65.00% | ||||||
Commitment fee (as percent) | 0.50% | ||||||
Original issue discount rate on maximum commitment | 1.00% | ||||||
Debt | 31,896 | $ 0 | |||||
Debt issuance costs capitalized | $ 3,300 | ||||||
Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Maximum increase of advance rate (as percent) | 90.00% | ||||||
Maximum effective interest rate (as percent) | 0.00% | 2.00% | 3.00% | ||||
Non-Recourse U.S. SPV facility | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread (as percent) | 9.75% | ||||||
Non-Recourse U.S. SPV facility | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Line of Credit | Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread (as percent) | 5.75% |
DEBT - Non-Recourse Canada SPV
DEBT - Non-Recourse Canada SPV Facility (Details) $ in Thousands | Aug. 02, 2018CAD ($) | Apr. 30, 2019 | Jun. 30, 2020USD ($) | Apr. 30, 2020CAD ($) | Dec. 31, 2019USD ($) |
Line of Credit Facility [Line Items] | |||||
Debt | $ 799,828 | $ 790,544 | |||
Line of Credit | Non-Recourse Canada SPV Facility | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, borrowing capacity | $ 175,000,000 | $ 100,000,000 | |||
Credit facility, expansion capacity | $ 250,000,000 | ||||
Stated interest rate (as percent) | 6.75% | ||||
Commitment fee (as percent) | 0.50% | ||||
Debt instrument, extended term | 1 year | ||||
Debt | 88,789 | $ 112,221 | |||
Deferred financing costs | $ 2,300 |
DEBT - Senior Revolver (Details
DEBT - Senior Revolver (Details) | 1 Months Ended | ||||
Nov. 30, 2018USD ($) | Nov. 30, 2016 | Jun. 30, 2020lender | Dec. 31, 2019 | Aug. 31, 2018 | |
Line of Credit | Revolving Credit Facility | Senior Revolver | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 50,000,000 | ||||
Number of banks | lender | 4 | ||||
Covenant terms, oustanding balance requirement for calendar year | $ 0 | ||||
Covenant terms, outstanding balance requirement, minimum number of days | 30 days | ||||
Line of Credit | Letter of Credit | Senior Revolver | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 | ||||
Debt instrument, term | 1 year | ||||
Senior Notes | 8.25% Senior Secured Notes | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate (as percent) | 8.25% | 8.25% | 8.25% | ||
London Interbank Offered Rate (LIBOR) | Line of Credit | Senior Revolver | |||||
Debt Instrument [Line Items] | |||||
Basis spread (as percent) | 5.00% | ||||
Minimum | London Interbank Offered Rate (LIBOR) | Line of Credit | Senior Revolver | |||||
Debt Instrument [Line Items] | |||||
Basis spread (as percent) | 5.00% |
DEBT - Cash Money Revolving Cre
DEBT - Cash Money Revolving Credit Facility (Details) - Line of Credit - Cash Money Revolving Credit Facility - CAD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 29, 2019 | |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 9,900,000 | $ 10,000,000 |
Revolving Credit Facility | Prime Rate | ||
Debt Instrument [Line Items] | ||
Basis spread (as percent) | 1.95% | |
Standby Letters of Credit | ||
Debt Instrument [Line Items] | ||
Reduction in borrowing capacity | $ 100,000 |
SHARE-BASED COMPENSATION - Narr
SHARE-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 3.3 | $ 2.6 | $ 6.5 | $ 4.8 |
Unrecognized compensation costs | $ 17.2 | $ 17.2 | ||
Compensation cost not yet recognized, period for recognition | 1 year 10 months 24 days | |||
2017 Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized (in shares) | 5,000,000 | 5,000,000 | ||
Time-Based | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Unrecognized compensation costs | $ 12 | $ 12 | ||
Market-Based | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Performance period of stockholder return | 3 years | |||
Unrecognized compensation costs | $ 5 | $ 5 |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summary of RSUs and PSUs (Details) | 6 Months Ended |
Jun. 30, 2020$ / sharesshares | |
Time-Based | |
Number of Shares | |
Outstanding, beginning of period (in shares) | shares | 1,061,753 |
Granted (in shares) | shares | 679,413 |
Vested (in shares) | shares | (307,142) |
Forfeited (in shares) | shares | (24,025) |
Outstanding, end of period (in shares) | shares | 1,409,999 |
Weighted Average Grant Date Fair Value per Share | |
Weighted average grant date fair value, beginning of period (USD per share) | $ / shares | $ 11.47 |
Weighted average grant date fair value, granted (USD per share) | $ / shares | 10.42 |
Weighted average grant date fair value, vested (USD per share) | $ / shares | 11.34 |
Weighted average grant date fair value, forfeited (USD per share) | $ / shares | 11.99 |
Weighted average grant date fair value, end of period (USD per share) | $ / shares | $ 10.97 |
Market-Based | |
Number of Shares | |
Outstanding, beginning of period (in shares) | shares | 394,861 |
Granted (in shares) | shares | 368,539 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | (4,687) |
Outstanding, end of period (in shares) | shares | 758,713 |
Weighted Average Grant Date Fair Value per Share | |
Weighted average grant date fair value, beginning of period (USD per share) | $ / shares | $ 11.47 |
Weighted average grant date fair value, granted (USD per share) | $ / shares | 10.42 |
Weighted average grant date fair value, vested (USD per share) | $ / shares | 11.34 |
Weighted average grant date fair value, forfeited (USD per share) | $ / shares | 11.99 |
Weighted average grant date fair value, end of period (USD per share) | $ / shares | $ 10.97 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Contingency [Line Items] | ||||
Effective income tax rate (as percent) | 5.00% | 27.40% | ||
Income tax benefit from CARES Act | $ 9.1 | |||
Income tax benefit from utilization of NOLs in certain entities in Canada | $ 4.6 | |||
Tax positions reserve | 1.1 | |||
Undistributed foreign earnings | $ 185.2 | $ 185.2 | ||
Canada Revenue Agency | Pro forma | ||||
Income Tax Contingency [Line Items] | ||||
Expected tax if earnings were distributed to the U.S. | $ 9.3 |
FAIR VALUE MEASUREMENTS - Summa
FAIR VALUE MEASUREMENTS - Summary of Assets and Liabilities Not Measured at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Aug. 31, 2018 |
Financial assets: | ||||
Restricted cash | $ 63,274 | $ 34,779 | $ 33,712 | |
Senior Notes | 8.25% Senior Secured Notes | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Stated interest rate (as percent) | 8.25% | 8.25% | 8.25% | |
Fair Value, Measurements, Recurring | Carrying Value | ||||
Financial assets: | ||||
Cash Surrender Value of Life Insurance | $ 6,409 | $ 6,171 | ||
Financial liabilities: | ||||
Non-qualified deferred compensation plan | 4,292 | 4,666 | ||
Fair Value, Measurements, Recurring | Estimated Fair Value | ||||
Financial assets: | ||||
Cash Surrender Value of Life Insurance | 6,409 | 6,171 | ||
Financial liabilities: | ||||
Non-qualified deferred compensation plan | 4,292 | 4,666 | ||
Fair Value, Measurements, Recurring | Estimated Fair Value | Level 1 | ||||
Financial assets: | ||||
Cash Surrender Value of Life Insurance | 6,409 | 6,171 | ||
Financial liabilities: | ||||
Non-qualified deferred compensation plan | 4,292 | 4,666 | ||
Fair Value, Measurements, Recurring | Estimated Fair Value | Level 2 | ||||
Financial assets: | ||||
Cash Surrender Value of Life Insurance | 0 | 0 | ||
Financial liabilities: | ||||
Non-qualified deferred compensation plan | 0 | 0 | ||
Fair Value, Measurements, Recurring | Estimated Fair Value | Level 3 | ||||
Financial assets: | ||||
Cash Surrender Value of Life Insurance | 0 | 0 | ||
Financial liabilities: | ||||
Non-qualified deferred compensation plan | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Carrying Value | ||||
Financial assets: | ||||
Cash and cash equivalents | 269,342 | 75,242 | ||
Restricted cash | 63,274 | 34,779 | ||
Loans receivable, net | 380,057 | 558,993 | ||
Equity method investment | 9,191 | 10,068 | ||
Financial liabilities: | ||||
Liability for losses on CSO lender-owned consumer loans | 5,164 | 10,623 | ||
Fair Value, Measurements, Nonrecurring | Carrying Value | 8.25% Senior Secured Notes | ||||
Financial liabilities: | ||||
Debt | 679,143 | 678,323 | ||
Fair Value, Measurements, Nonrecurring | Carrying Value | Non-Recourse U.S. SPV facility | ||||
Financial liabilities: | ||||
Debt | 31,896 | |||
Fair Value, Measurements, Nonrecurring | Carrying Value | Non-Recourse Canada SPV facility | ||||
Financial liabilities: | ||||
Debt | 88,789 | 112,221 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | ||||
Financial assets: | ||||
Cash and cash equivalents | 269,342 | 75,242 | ||
Restricted cash | 63,274 | 34,779 | ||
Loans receivable, net | 380,057 | 558,993 | ||
Equity method investment | 9,191 | 10,068 | ||
Financial liabilities: | ||||
Liability for losses on CSO lender-owned consumer loans | 5,164 | 10,623 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | 8.25% Senior Secured Notes | ||||
Financial liabilities: | ||||
Debt | 543,111 | 596,924 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Non-Recourse U.S. SPV facility | ||||
Financial liabilities: | ||||
Debt | 35,206 | |||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Non-Recourse Canada SPV facility | ||||
Financial liabilities: | ||||
Debt | 91,109 | 115,243 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 1 | ||||
Financial assets: | ||||
Cash and cash equivalents | 269,342 | 75,242 | ||
Restricted cash | 63,274 | 34,779 | ||
Loans receivable, net | 0 | 0 | ||
Equity method investment | 0 | 0 | ||
Financial liabilities: | ||||
Liability for losses on CSO lender-owned consumer loans | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 1 | 8.25% Senior Secured Notes | ||||
Financial liabilities: | ||||
Debt | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 1 | Non-Recourse U.S. SPV facility | ||||
Financial liabilities: | ||||
Debt | 0 | |||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 1 | Non-Recourse Canada SPV facility | ||||
Financial liabilities: | ||||
Debt | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 2 | ||||
Financial assets: | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash | 0 | 0 | ||
Loans receivable, net | 0 | 0 | ||
Equity method investment | 0 | 0 | ||
Financial liabilities: | ||||
Liability for losses on CSO lender-owned consumer loans | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 2 | 8.25% Senior Secured Notes | ||||
Financial liabilities: | ||||
Debt | 543,111 | 596,924 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 2 | Non-Recourse U.S. SPV facility | ||||
Financial liabilities: | ||||
Debt | 0 | |||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 2 | Non-Recourse Canada SPV facility | ||||
Financial liabilities: | ||||
Debt | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | ||||
Financial assets: | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash | 0 | 0 | ||
Loans receivable, net | 380,057 | 558,993 | ||
Equity method investment | 9,191 | 10,068 | ||
Financial liabilities: | ||||
Liability for losses on CSO lender-owned consumer loans | 5,164 | 10,623 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | 8.25% Senior Secured Notes | ||||
Financial liabilities: | ||||
Debt | 0 | 0 | ||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | Non-Recourse U.S. SPV facility | ||||
Financial liabilities: | ||||
Debt | 35,206 | |||
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | Non-Recourse Canada SPV facility | ||||
Financial liabilities: | ||||
Debt | $ 91,109 | $ 115,243 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Jun. 30, 2020 | Aug. 31, 2018 | |
Senior Notes | 8.25% Senior Secured Notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Stated interest rate (as percent) | 8.25% | 8.25% | 8.25% |
Katapult | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Impairment recognized | $ 3.7 | ||
Ownership percentage | 42.50% |
STOCKHOLDERS' EQUITY - Schedule
STOCKHOLDERS' EQUITY - Schedule of Stockholders' Equity (Details) - USD ($) $ in Thousands | May 27, 2020 | Mar. 02, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance, beginning period | $ 59,571 | $ 50,513 | $ 36,744 | $ (19,101) | $ 50,513 | $ (19,101) | ||
Net income from continuing operations | 21,080 | 36,013 | 17,667 | 28,673 | 57,093 | 46,340 | ||
Net income (loss) from discontinued operations | 993 | 292 | (834) | 8,375 | 1,285 | 7,541 | ||
Foreign currency translation adjustment | 10,261 | (22,193) | 3,635 | 16,695 | (11,932) | 20,330 | ||
Dividends | $ (2,200) | $ (2,200) | (2,244) | (2,256) | ||||
Share based compensation expense | 3,310 | 3,194 | 2,644 | 2,172 | ||||
Proceeds from exercise of stock options | $ 126 | 29 | 40 | |||||
Repurchase of common stock (in shares) | (540,762) | |||||||
Repurchase of common stock | $ (5,509) | (2,507) | ||||||
Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes | (29) | (609) | 0 | (110) | ||||
Balance, ending period | $ 92,942 | $ 59,571 | $ 57,378 | $ 36,744 | $ 92,942 | $ 57,378 | ||
Common Stock | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance, beginning period (in shares) | 40,779,447 | 41,156,224 | 46,431,289 | 46,412,231 | 41,156,224 | 46,412,231 | ||
Balance, beginning period | $ 9 | $ 9 | $ 9 | $ 9 | $ 9 | $ 9 | ||
Proceeds from exercise of stock options (in shares) | 42,094 | 4,908 | 7,888 | |||||
Repurchase of common stock (in shares) | (244,200) | |||||||
Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes (in shares) | 105,098 | 121,891 | 63,285 | 11,170 | ||||
Balance, ending period (in shares) | 40,884,545 | 40,779,447 | 46,255,282 | 46,431,289 | 40,884,545 | 46,255,282 | ||
Balance, ending period | $ 9 | $ 9 | $ 9 | $ 9 | $ 9 | $ 9 | ||
Treasury Stock | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance, beginning period | (77,852) | (72,343) | 0 | 0 | (72,343) | 0 | ||
Repurchase of common stock | (5,509) | (2,507) | ||||||
Balance, ending period | (77,852) | (77,852) | (2,507) | 0 | (77,852) | (2,507) | ||
Paid-in capital | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance, beginning period | 70,798 | 68,087 | 62,117 | 60,015 | 68,087 | 60,015 | ||
Share based compensation expense | 3,310 | 3,194 | 2,644 | 2,172 | ||||
Proceeds from exercise of stock options | 126 | 29 | 40 | |||||
Common stock issued for RSU's vesting, net of shares withheld and withholding paid for employee taxes | (29) | (609) | (110) | |||||
Balance, ending period | 74,079 | 70,798 | 64,790 | 62,117 | 74,079 | 64,790 | ||
Retained Earnings (Deficit) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance, beginning period | 127,472 | 93,423 | 18,983 | (18,065) | 93,423 | (18,065) | ||
Net income from continuing operations | 21,080 | 36,013 | 17,667 | 28,673 | ||||
Net income (loss) from discontinued operations | 993 | 292 | (834) | 8,375 | ||||
Dividends | (2,244) | (2,256) | ||||||
Balance, ending period | 147,301 | 127,472 | 35,816 | 18,983 | 147,301 | 35,816 | ||
AOCI | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance, beginning period | (60,856) | (38,663) | (44,365) | (61,060) | (38,663) | (61,060) | ||
Foreign currency translation adjustment | 10,261 | (22,193) | 3,635 | 16,695 | ||||
Balance, ending period | $ (50,595) | $ (60,856) | $ (40,730) | $ (44,365) | $ (50,595) | $ (40,730) |
STOCKHOLDERS' EQUITY - Narrativ
STOCKHOLDERS' EQUITY - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | May 27, 2020 | Mar. 02, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Aug. 03, 2020 | Apr. 30, 2020 | Feb. 05, 2020 |
Dividends Payable [Line Items] | |||||||
Quarterly cash dividend (in dollars per share) | $ 0.055 | $ 0.055 | |||||
Dividends paid | $ 2,200 | $ 2,200 | $ 2,244 | $ 2,256 | |||
Subsequent Event | |||||||
Dividends Payable [Line Items] | |||||||
Quarterly cash dividend (in dollars per share) | $ 0.055 |
EARNINGS PER SHARE - Summary of
EARNINGS PER SHARE - Summary of Basic Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||||||
Net income from continuing operations | $ 21,080 | $ 36,013 | $ 17,667 | $ 28,673 | $ 57,093 | $ 46,340 |
Net income (loss) from discontinued operations | 993 | $ 292 | (834) | $ 8,375 | 1,285 | 7,541 |
Net income | $ 22,073 | $ 16,833 | $ 58,378 | $ 53,881 | ||
Weight average common shares - basic (in shares) | 40,810 | 46,451 | 40,814 | 46,438 | ||
Dilutive effect of stock options and restricted stock units (in shares) | 735 | 656 | 872 | 897 | ||
Weighted average common shares - diluted (in shares) | 41,545 | 47,107 | 41,686 | 47,335 | ||
Basic earnings (loss) per share: | ||||||
Continuing operations (in dollars per share) | $ 0.52 | $ 0.38 | $ 1.40 | $ 1 | ||
Discontinued operations (in dollars per share) | 0.02 | (0.02) | 0.03 | 0.16 | ||
Basic earnings per share (in dollars per share) | 0.54 | 0.36 | 1.43 | 1.16 | ||
Diluted earnings (loss) per share: | ||||||
Continuing operations (in dollars per share) | 0.51 | 0.38 | 1.37 | 0.98 | ||
Discontinued operations (in dollars per share) | 0.02 | (0.02) | 0.03 | 0.16 | ||
Diluted earnings per share (in dollars per share) | $ 0.53 | $ 0.36 | $ 1.40 | $ 1.14 |
EARNINGS PER SHARE - Narrative
EARNINGS PER SHARE - Narrative (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 2.3 | 1.3 | 1.7 | 1.2 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Cash paid for: | ||
Interest | $ 34,125 | $ 34,678 |
Income taxes, net of refunds | 1,133 | 4,231 |
Non-cash investing activities: | ||
Property and equipment accrued in accounts payable and accrued liabilities | $ 117 | $ 105 |
SEGMENT REPORTING - Narrative (
SEGMENT REPORTING - Narrative (Details) | Jun. 30, 2020provincestorestate |
U.S. | |
Segment Reporting Information [Line Items] | |
Number of retail locations | store | 211 |
Number of states/provinces with online presence | state | 27 |
Canada | |
Segment Reporting Information [Line Items] | |
Number of retail locations | store | 204 |
Number of states/provinces with online presence | province | 5 |
Number of states/provinces with retail locations | province | 7 |
SEGMENT REPORTING - Summary of
SEGMENT REPORTING - Summary of Financial Information by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||||
Consolidated revenue | $ 182,509 | $ 264,300 | $ 463,315 | $ 542,239 | |
Consolidated net revenue | 131,816 | 152,290 | 299,086 | 327,844 | |
Consolidated gross margin | 76,499 | 81,181 | 176,198 | 186,678 | |
Consolidated operating income | 22,148 | 25,120 | 60,098 | 63,839 | |
Consolidated expenditures for long-lived assets | 392 | 3,045 | 5,225 | 6,164 | |
Total gross loans receivable | 456,512 | 456,512 | $ 665,828 | ||
U.S. | |||||
Segment Reporting Information [Line Items] | |||||
Consolidated revenue | 137,320 | 210,046 | 359,088 | 436,165 | |
Consolidated net revenue | 95,790 | 117,494 | 231,517 | 258,633 | |
Consolidated gross margin | 56,860 | 65,067 | 144,400 | 154,870 | |
Consolidated operating income | 11,857 | 17,029 | 45,283 | 48,224 | |
Consolidated expenditures for long-lived assets | 248 | 2,568 | 4,528 | 4,998 | |
Total gross loans receivable | 199,734 | 199,734 | 363,453 | ||
Canada | |||||
Segment Reporting Information [Line Items] | |||||
Consolidated revenue | 45,189 | 54,254 | 104,227 | 106,074 | |
Consolidated net revenue | 36,026 | 34,796 | 67,569 | 69,211 | |
Consolidated gross margin | 19,639 | 16,114 | 31,798 | 31,808 | |
Consolidated operating income | 10,291 | 8,091 | 14,815 | 15,615 | |
Consolidated expenditures for long-lived assets | 144 | $ 477 | 697 | $ 1,166 | |
Total gross loans receivable | $ 256,778 | $ 256,778 | $ 302,375 |
SEGMENT REPORTING - Summary o_2
SEGMENT REPORTING - Summary of Long-lived Assets by Geographical Region (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total net long-lived assets | $ 64,259 | $ 70,811 |
U.S. | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total net long-lived assets | 39,974 | 43,618 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total net long-lived assets | $ 24,285 | $ 27,193 |
COMMITMENTS AND CONTENGENCIES (
COMMITMENTS AND CONTENGENCIES (Details) - USD ($) | May 27, 2020 | Jun. 30, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Litigation settlement amount | $ 9,000,000 | |
Insurance retention | $ 2,500,000 | $ 2,500,000 |
Receivable from insurance | 9,000,000 | |
Litigation settlement liability | 9,000,000 | |
Litigation settlement liability for insurance retention | $ 1,300,000 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) | Jun. 30, 2020renewal_option |
Leases [Abstract] | |
Operating lease original term of contract | 5 years |
Number of renewal terms | 2 |
Operating lease renewal term | 5 years |
LEASES - Summary of Operating L
LEASES - Summary of Operating Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease cost | $ 8,421 | $ 8,473 | $ 16,912 | $ 16,987 |
Operating lease payments | 16,545 | 17,420 | ||
ROU assets obtained in exchange for lease liabilities | $ 6,922 | $ 9,468 | ||
Weighted average remaining lease term | 6 years 1 month 6 days | 6 years 3 months 18 days | 6 years 1 month 6 days | 6 years 3 months 18 days |
Weighted average operating discount rate | 10.30% | 10.30% | 10.30% | 10.30% |
Third-Party | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease cost | $ 7,576 | $ 7,608 | $ 15,221 | $ 15,246 |
Related-Party | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease cost | $ 845 | $ 865 | $ 1,691 | $ 1,741 |
LEASES - Schedule of Future Min
LEASES - Schedule of Future Minimum Lease Payments, ASC 842 (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Lessee, Lease, Description [Line Items] | |
Remainder of 2020 | $ 17,173 |
2021 | 32,238 |
2022 | 29,301 |
2023 | 22,155 |
2024 | 16,875 |
2025 | 12,356 |
Thereafter | 33,337 |
Total | 163,435 |
Less: Imputed interest | (43,668) |
Operating lease liabilities | 119,767 |
Third-Party | |
Lessee, Lease, Description [Line Items] | |
Remainder of 2020 | 15,334 |
2021 | 28,475 |
2022 | 25,638 |
2023 | 20,836 |
2024 | 15,911 |
2025 | 11,492 |
Thereafter | 30,676 |
Total | 148,362 |
Less: Imputed interest | (40,146) |
Operating lease liabilities | 108,216 |
Related-Party | |
Lessee, Lease, Description [Line Items] | |
Remainder of 2020 | 1,839 |
2021 | 3,763 |
2022 | 3,663 |
2023 | 1,319 |
2024 | 964 |
2025 | 864 |
Thereafter | 2,661 |
Total | 15,073 |
Less: Imputed interest | (3,522) |
Operating lease liabilities | $ 11,551 |
DISCONTINUED OPERATIONS - Sched
DISCONTINUED OPERATIONS - Schedules of Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement Disclosures | ||||||
Pre-tax income (loss) from operations of discontinued operations | $ 1,324 | $ 0 | $ 1,714 | $ (39,048) | ||
Income tax expense (benefit) related to disposition | 331 | 834 | 429 | (46,589) | ||
Net income (loss) from discontinued operations | 993 | $ 292 | (834) | $ 8,375 | 1,285 | 7,541 |
Cash Flow Disclosures | ||||||
Net cash provided by (used in) discontinued operating activities | 1,714 | (504) | ||||
Net cash used in discontinued investing activities | 0 | (14,213) | ||||
U.K. Segment | Discontinued Operations, Disposed of by Means Other than Sale | ||||||
Income Statement Disclosures | ||||||
Revenue | 0 | 0 | 0 | 6,957 | ||
Provision for losses | 0 | 0 | 0 | 1,703 | ||
Net revenue | 0 | 0 | 0 | 5,254 | ||
Office | 0 | 0 | 0 | 246 | ||
Other costs of providing services | 0 | 0 | 0 | 61 | ||
Advertising | 0 | 0 | 0 | 775 | ||
Total cost of providing services | 0 | 0 | 0 | 1,082 | ||
Gross margin | 0 | 0 | 0 | 4,172 | ||
Corporate, district and other expenses | 0 | 0 | 0 | 3,810 | ||
Interest income | 0 | 0 | 0 | (4) | ||
(Gain) loss on disposition | (1,324) | 0 | (1,714) | 39,414 | ||
Total operating (income) expense | (1,324) | 0 | (1,714) | 43,220 | ||
Pre-tax income (loss) from operations of discontinued operations | 1,324 | 0 | 1,714 | (39,048) | ||
Income tax expense (benefit) related to disposition | 331 | 834 | 429 | (46,589) | ||
Net income (loss) from discontinued operations | $ 993 | $ (834) | 1,285 | 7,541 | ||
Cash Flow Disclosures | ||||||
Net cash provided by (used in) discontinued operating activities | 1,714 | (504) | ||||
Net cash used in discontinued investing activities | 0 | (14,213) | ||||
Net cash used in discontinued financing activities | $ 0 | $ 0 |
DISCONTINUED OPERATIONS - Narra
DISCONTINUED OPERATIONS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Income tax expense (benefit) related to disposition | $ 331 | $ 834 | $ 429 | $ (46,589) |
U.K. Segment | Discontinued Operations, Disposed of by Means Other than Sale | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
(Gain) loss on disposition | 1,324 | 0 | 1,714 | (39,414) |
Income tax expense (benefit) related to disposition | $ 331 | $ 834 | $ 429 | $ (46,589) |
GOODWILL (Details)
GOODWILL (Details) | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, Beginning Balance | $ 120,609,000 |
Acquisition (Note 17) | 14,791,000 |
Foreign currency translation | (1,423,000) |
Goodwill, ending balance | 133,977,000 |
Impairment losses | 0 |
U.S. | |
Goodwill [Roll Forward] | |
Goodwill, Beginning Balance | 91,131,000 |
Acquisition (Note 17) | 14,791,000 |
Foreign currency translation | 0 |
Goodwill, ending balance | 105,922,000 |
Canada | |
Goodwill [Roll Forward] | |
Goodwill, Beginning Balance | 29,478,000 |
Acquisition (Note 17) | 0 |
Foreign currency translation | (1,423,000) |
Goodwill, ending balance | $ 28,055,000 |
ACQUISITION - Narrative (Detail
ACQUISITION - Narrative (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||||
Acquisition of Ad Astra, net of cash received | $ 14,418 | $ 0 | ||||
Other costs of providing services | $ 8,001 | $ 12,854 | 17,656 | 27,074 | ||
Operating expense | (54,351) | $ (56,061) | (116,100) | (122,839) | ||
Goodwill | $ 14,800 | $ 133,977 | 133,977 | $ 120,609 | ||
Ad Astra | ||||||
Business Acquisition [Line Items] | ||||||
Equity interests acquired | 100.00% | |||||
Acquisition of Ad Astra, net of cash received | $ 14,400 | |||||
Other costs of providing services | $ 8,400 | |||||
Operating expense | $ (5,600) | |||||
Goodwill | $ 14,791 |
ACQUISITION - Schedule of Asset
ACQUISITION - Schedule of Assets and Liabilities Acquired and Assumed (Details) - USD ($) $ in Thousands | Jan. 03, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||
Goodwill | $ 14,800 | $ 133,977 | $ 120,609 |
Ad Astra | |||
Business Acquisition [Line Items] | |||
Cash consideration transferred: | 17,811 | ||
Cash and cash equivalents | 3,360 | ||
Accounts receivable | 465 | ||
Property and equipment | 358 | ||
Intangible assets | 1,101 | ||
Goodwill | 14,791 | ||
Operating lease asset | 235 | ||
Accounts payable and accrued liabilities | (2,264) | ||
Operating lease liabilities | (235) | ||
Total | $ 17,811 |
SHARE REPURCHASE PROGRAM (Detai
SHARE REPURCHASE PROGRAM (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Aug. 31, 2019 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Feb. 29, 2020 | Dec. 31, 2019 | Aug. 29, 2019 | Apr. 30, 2019 | |
Equity, Class of Treasury Stock [Line Items] | ||||||||
Total number of shares repurchased (in shares) | 540,762 | |||||||
Total value of shares repurchased | $ 5,509,000 | $ 2,507,000 | ||||||
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 | ||||||
Repurchase Program, 2020 | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Total authorized repurchase amount for the period presented | $ 25,000,000 | |||||||
Repurchase Program, 2019 | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Total authorized repurchase amount for the period presented | $ 50,000,000 | |||||||
Total number of shares repurchased (in shares) | 455,255 | |||||||
Average price paid per share (in dollars per share) | $ 10.45 | |||||||
Total value of shares repurchased | $ 4,800,000 | |||||||
Share Repurchase Agreement with FFL | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Closing common stock price (in usd per share) | $ 13.97 | |||||||
Discount | 3.00% | |||||||
Share Repurchase Agreement with FFL | Affiliated Entity | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Total number of shares repurchased (in shares) | 2,000,000 | |||||||
Average price paid per share (in dollars per share) | $ 13.55 | |||||||
Common stock, par value (in usd per share) | $ 0.001 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Jul. 31, 2020 | Apr. 30, 2020 | Aug. 03, 2020 | Feb. 05, 2020 |
Subsequent Event [Line Items] | ||||
Quarterly cash dividend (in dollars per share) | $ 0.055 | $ 0.055 | ||
London Interbank Offered Rate (LIBOR) | Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | ||||
Subsequent Event [Line Items] | ||||
Basis spread (as percent) | 9.75% | |||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Quarterly cash dividend (in dollars per share) | $ 0.055 | |||
Subsequent Event | Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | ||||
Subsequent Event [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 200,000,000 | |||
Balance threshold for interest rate terms | $ 145,500,000 | |||
Subsequent Event | Floor | Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | Balances Up To Threshold Amount | ||||
Subsequent Event [Line Items] | ||||
Basis spread (as percent) | 1.65% | |||
Subsequent Event | Floor | Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | Balances Above Threshold Amount | ||||
Subsequent Event [Line Items] | ||||
Basis spread (as percent) | 1.65% | |||
Subsequent Event | London Interbank Offered Rate (LIBOR) | Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | Balances Up To Threshold Amount | ||||
Subsequent Event [Line Items] | ||||
Basis spread (as percent) | 6.25% | |||
Subsequent Event | London Interbank Offered Rate (LIBOR) | Non-Recourse U.S. SPV facility | Revolving Credit Facility | Line of Credit | Balances Above Threshold Amount | ||||
Subsequent Event [Line Items] | ||||
Basis spread (as percent) | 9.75% |