EXHIBIT
99.1
[CPS LOGO] NEWS
RELEASE
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CONSUMER PORTFOLIO SERVICES, INC. REPORTS
2005 SECOND QUARTER EARNINGS
IRVINE, CALIFORNIA, JULY 26, 2005 (BUSINESS WIRE) -- Consumer Portfolio
Services, Inc. (Nasdaq: CPSS) today announced earnings for its second
quarter
ended June 30, 2005.
Net income for the quarter ended June 30, 2005 was $545,000, or $0.02 per
diluted share, compared to net loss of $(174,000), or $(0.01) per diluted
share,
for the quarter ended June 30, 2004. For the three months ended June 30,
2005
total revenues increased approximately $15.1 million, or 46.2%, to $47.8
million, compared to $32.7 million for the three months ended June 30, 2004.
Total expenses for the three months ended June 30, 2005 were $47.2 million,
an
increase of $14.3 million, or 43.7%, as compared to $32.9 million for the
three
months ended June 30, 2004.
Net income for the six months ended June 30, 2005 was $306,000, or $0.01 per
diluted share, compared to net loss of $(1.6) million, or $(0.08) per
diluted
share, for the six months ended June 30, 2004. For the six months ended June
30,
2005 total revenues increased approximately $29.4 million, or 48.8%, to
$89.6
million, compared to $60.2 million for the six months ended June 30, 2004.
Total
expenses for the six months ended June 30, 2005 were $89.3 million, an
increase
of $27.5 million, or 44.5%, as compared to $61.8 million for the six months
ended June 30, 2004.
"We are pleased with the financial results for the second quarter as we were
profitable for the first time in almost two years," said Charles E. Bradley,
President and Chief Executive Officer of Consumer Portfolio Services. "Now
that
our transition from gain on sale to portfolio accounting has resulted in our
return to profitability, we would expect to see continued earnings in the
coming
quarters. Operationally, we built on the positive momentum from the last few
quarters. Asset performance during the first half of the year has been
stronger
than it has been since the mid-1990s. Additionally, during the second
quarter we
continued our growth in purchases of new receivables, which were once again
the
highest they have been in almost four years."
During the second quarter of 2005, Consumer Portfolio Services purchased
$153.9
million of contracts from dealers as compared to $144.2 million during the
first
quarter of 2005 and $107.4 million during the second quarter 2004. In
addition,
the Company continued its regular quarterly securitization program with the
June
sale of $130.6 million of AAA/Aaa rated asset backed notes. As of June 30,
2005,
the Company's managed receivables totaled $966.2 million, as follows ($ in
millions):
Owned by Consolidated Subsidiaries*
$772.6
Owned by Non-Consolidated Subsidiaries
162.3
As Third Party Servicer for SeaWest Financial
31.3
- ------
Total
$966.2
* Before $78.8 million of allowance for credit losses and
deferred acquisition fees.
As previously reported, in order to increase transparency of the Company's
financial reports, in the third quarter of 2003 Consumer Portfolio Services
began structuring its securitization transactions as secured financings,
with
receivables and associated debt remaining on the balance sheet, and without
recognition of a gain on sale. Accordingly, net earnings are recognized over
the
life of the receivables as interest income and fee income, less related
funding
costs and a provision for losses. Such loan loss provisions are recorded
upon
acquisition and during the life of the receivables. The effect is to
accelerate
recognition of expenses and defer recognition of revenue. As a result,
reported
earnings have been less than what they would have been had the Company
continued
to structure its securitizations to record a gain on sale.
CONFERENCE CALL
Consumer Portfolio Services announced that it will hold a conference call
tomorrow, July 27, 2005, at 1:30 p.m. EDT to discuss its quarterly earnings.
Those wishing to participate by telephone may dial-in at 973-409-9261
approximately 10 minutes prior to the scheduled time.
A replay will be available between July 27, 2005 and August 3, 2005,
beginning
one hour after conclusion of the call, by dialing 877-519-4471 or
973-341-3080
for international participants, with pin number 6295911. A broadcast of the
conference call will also be available live and for 30 days after the call
via
the Company's web site at www.consumerportfolio.com and at
www.streetevents.com.
ABOUT CONSUMER PORTFOLIO SERVICES, INC.
Consumer Portfolio Services, Inc. is a consumer finance company that
specializes
in purchasing, selling and servicing retail automobile installment sale
contracts originated by automobile dealers located throughout the United
States.
The Company is currently active in 38 states. Through its purchase of
contracts,
the Company provides indirect financing to car dealer customers with limited
credit histories, low incomes or past credit problems, who are typically
unable
to obtain financing from traditional sources.
FORWARD-LOOKING STATEMENTS IN THIS NEWS RELEASE INCLUDE THE COMPANY'S
RECORDED
REVENUE, EXPENSE, GAIN ON SALE REVENUE AND PROVISION FOR CREDIT LOSSES,
BECAUSE
THESE ITEMS ARE DEPENDENT ON THE COMPANY'S ESTIMATES OF FUTURE LOSSES, AND
ALSO
INCLUDE THE STATEMENT THAT CONTINUED EARNINGS ARE EXPECTED. THE ACCURACY OF
SUCH
ESTIMATES MAY BE ADVERSELY AFFECTED BY VARIOUS FACTORS, WHICH INCLUDE (IN
ADDITION TO RISKS RELATING TO THE ECONOMY GENERALLY) THE FOLLOWING: POSSIBLE
INCREASED DELINQUENCIES; REPOSSESSIONS AND LOSSES ON RETAIL INSTALLMENT
CONTRACTS; INCORRECT PREPAYMENT SPEED AND/OR DISCOUNT RATE ASSUMPTIONS;
POSSIBLE
UNAVAILABILITY OF QUALIFIED PERSONNEL, WHICH COULD ADVERSELY AFFECT THE
COMPANY'S ABILITY TO SERVICE ITS PORTFOLIO; POSSIBLE INCREASES IN THE RATE
OF
CONSUMER BANKRUPTCY FILINGS OR CHANGES IN BANKRUPTCY LAW, WHICH COULD
ADVERSELY
AFFECT THE COMPANY'S RIGHTS TO COLLECT PAYMENTS FROM ITS PORTFOLIO; OTHER
CHANGES IN GOVERNMENT REGULATIONS AFFECTING CONSUMER CREDIT; POSSIBLE
DECLINES
IN THE MARKET PRICE FOR USED VEHICLES, WHICH COULD ADVERSELY AFFECT THE
COMPANY'S REALIZATION UPON REPOSSESSED VEHICLES; AND ECONOMIC CONDITIONS IN
GEOGRAPHIC AREAS IN WHICH THE COMPANY'S BUSINESS IS CONCENTRATED. ALL OF
SUCH
FACTORS ALSO MAY AFFECT THE COMPANY'S FUTURE EARNINGS, AS TO WHICH THERE CAN
BE
NO ASSURANCE.
THE STATEMENTS CONCERNING THE INTENDED STRUCTURE OF FUTURE SECURITIZATIONS
AND
THE EFFECTS OF SUCH STRUCTURES ON FINANCIAL ITEMS ARE FORWARD-LOOKING
STATEMENTS. IF THE COMPANY WERE TO CHANGE THE STRUCTURE OF FUTURE
TRANSACTIONS,
THAT COULD CAUSE SUCH FORWARD-LOOKING STATEMENTS NOT TO BE ACCURATE.
ANY IMPLICATION THAT THE RESULTS OF THE MOST RECENTLY COMPLETED QUARTER ARE
INDICATIVE OF FUTURE RESULTS IS DISCLAIMED, AND THE READER SHOULD DRAW NO
SUCH
INFERENCE. FACTORS SUCH AS THOSE IDENTIFIED ABOVE IN RELATION TO GAIN ON
SALE
AND PROVISION FOR CREDIT LOSSES MAY AFFECT FUTURE PERFORMANCE.
Consumer Portfolio Services, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three months ended Six months ended
June 30, June 30,
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2005 2004 2005 2004
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Revenues:
Interest income $40,522 $25,722 $76,694 $46,145
Servicing fees 1,795 3,507 4,060 6,831
Other income 5,459 3,458 8,856 7,233
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47,776 32,687 89,610 60,209
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Expenses:
Employee costs 9,701 9,794 20,151 19,447
General and administrative 6,627 6,466 11,766 10,433
Interest 11,948 7,500 22,332 13,412
Provision for credit losses 15,224 6,300 27,536 13,050
Other expenses 3,731 2,801 7,519 5,448
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47,231 32,861 89,304 61,790
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Income (loss) before income
taxes 545 (174) 306 (1,581)
Income taxes - - - -
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Net income (loss) $545 $(174) $306 $(1,581)
========================================
Earnings (loss) per share:
Basic $0.03 $(0.01) $0.01 $(0.08)
Diluted 0.02 (0.01) 0.01 (0.08)
Number of shares used in
computing earnings
(loss) per share:
Basic 21,623 21,016 21,576 20,827
Diluted 23,399 21,016 23,451 20,827
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
June 30, Dec. 31,
2005 2004
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Cash and restricted cash $155,301 $139,479
Finance receivables, net 693,847 550,191
Residual interest in
securitizations 38,053 50,430
Other assets 26,240 26,499
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$913,441 $766,599
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Accounts payable and other
liabilities $19,876 $22,552
Warehouse lines of credit 45,315 34,279
Residual interest financing 12,031 22,204
Securitization trust debt 692,020 542,815
Senior secured debt 59,829 59,829
Subordinated debt 14,000 15,000
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843,071 696,679
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Shareholders' equity 70,370 69,920
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$913,441 $766,599
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INVESTOR RELATIONS CONTACT
Charles E. Bradley
Consumer Portfolio Services
949-753-6800