Exhibit 99.1
World Acceptance Corporation Reports Record Second Quarter Income
GREENVILLE, S.C.--(BUSINESS WIRE)--Oct. 18, 2004--World Acceptance
Corporation (NASDAQ/NM:WRLD) today reported higher revenue, net income
and loans for its second fiscal quarter ended September 30, 2004.
Net income for the second quarter rose 13.2% to $6.9 million, or
$0.36 per diluted share, compared with $6.1 million, or $0.32 per
diluted share, for the same quarter of the prior year. Total revenues
for the quarter increased 19.4% to $49.8 million from $41.7 million
for the prior year quarter.
"World Acceptance's record results for the second quarter were due
to increased loan demand, improved operating leverage and the
contribution of offices acquired since last year," stated Douglas R.
Jones, President and CEO of World Acceptance Corporation. "At the end
of the quarter, we acquired 17 offices with loan portfolios totaling
$9.7 million. These offices will increase our market presence in Texas
and Kentucky and we believe that these investments in the first half
of the fiscal year should pay benefits in the upcoming growth season
quarter and on into the future."
Gross loans outstanding increased to $349.4 million at September
30, 2004, a 23.3% increase over the $283.5 million in balances
outstanding at September 30, 2003, and a 12.7% increase since the
beginning of the fiscal year. Two acquisitions were completed
effective September 30, 2004, including 10 offices and $2.9 million in
gross loans receivable in Texas and seven offices and $6.8 million in
gross loans in Kentucky. The acquisitions had no effect on operating
results for the quarter.
Net charge-offs as a percentage of average loans outstanding
declined to 15.4% during the most recent quarter compared with 16.0%
during the three month period ending September 30, 2003. "We continue
to make progress in reducing charge-offs," stated Mr. Jones. "We
normally experience a seasonal increase in our charge-offs in the
second quarter compared to our first quarter due to vacations by both
our employees and our customers and this year followed a similar
pattern. For the first six months of this fiscal year, our charge-off
rate declined to 14.0% from 14.7% in the same period of last year."
Operating income (revenues less the provision for loan losses and
general and administrative expenses) increased to $11.9 million and
24.0% of revenues during the most recent quarter compared to $10.4
million and 24.9% of revenues during the corresponding quarter of the
prior year.
Several key return ratios remained very high during the quarter,
as the return on average assets (annualized) amounted to 9.7% and the
annualized return on average equity was 17.0%. This compares with a
10.4% return on assets and a 19.0% return on equity for the quarter
ended September 30, 2003.
Six-Month Results
For the first six months of the fiscal year, net income was $14.2
million, or $0.73 per diluted share, representing a 21.0% increase
over the $11.7 million, or $0.62 per diluted share, for the prior year
six-month period. Total revenues for the first six months of fiscal
2005 were $97.2 million, an 18.7% increase over the $81.9 million
during the corresponding period of the previous year.
During the first six months of the fiscal year, the Company opened
or acquired 50 offices and closed one non-performing office, leaving a
total of 575 offices at September 30, 2004.
About World Acceptance
World Acceptance Corporation is one of the largest small-loan
consumer finance companies, operating 575 offices in 12 states. It is
also the parent company of ParaData Financial Systems, a provider of
computer software solutions for the consumer finance industry.
Second Quarter Conference Call
The senior management of World Acceptance Corporation will review
the Company's second quarter results in its quarterly conference call
to be held at 2:00 P.M. Eastern time today. Interested parties may
participate in this call by dialing 1-888-694-4769. A simulcast of the
conference call is also available on the Internet at:
http://phx.corporate-ir.net/playerlink.zhtml?c=103383&s=wm&e=953600.
The call will be available for replay on the Internet for
approximately 30 days.
This press release may contain various "forward-looking
statements" within the meaning of Section 27A of the Securities
Exchange Act of 1934, as amended, that represent the Company's
expectations or beliefs concerning future events. Such forward-looking
statements are about matters that are inherently subject to risks and
uncertainties. Factors that could cause actual results or performance
to differ from the expectations expressed or implied in such
forward-looking statements include changes in the timing and amount of
revenues that may be recognized by the Company, changes in current
revenue and expense trends (including trends affecting charge-offs),
changes in the Company's markets and changes in the economy
(particular in the markets served by the Company). Such factors are
discussed in greater detail in the Company's filings with the
Securities and Exchange Commission. World Acceptance Corporation is
not responsible for updating the information contained in this press
release beyond the publication date, or for changes made to this
document by wire services or Internet services.
World Acceptance Corporation
Consolidated Statements of Operations
- ----------------------------------------------------------------------
(unaudited and in thousands, except per share amounts)
Three Months Ended Six Months Ended
September 30, September 30,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Interest & fees $ 43,478 36,549 84,079 70,954
Insurance & other 6,276 5,127 13,153 10,985
--------- --------- --------- ---------
Total revenues 49,754 41,676 97,232 81,939
Expenses:
Provision for loan losses 11,282 9,328 19,909 17,257
General and administrative
expenses
Personnel 17,478 14,511 35,184 29,860
Occupancy & equipment 3,112 2,443 6,027 4,745
Data processing 399 446 867 922
Advertising 1,370 1,171 2,950 2,454
Intangible amortization 633 566 1,265 1,122
Other 3,539 2,824 6,658 5,500
--------- --------- --------- ---------
26,531 21,961 52,951 44,603
Interest expense 1,067 928 2,056 1,919
--------- --------- --------- ---------
Total expenses 38,880 32,217 74,916 63,779
--------- --------- --------- ---------
Income before taxes 10,874 9,459 22,316 18,160
Income taxes 3,968 3,358 8,145 6,447
--------- --------- --------- ---------
Net income $ 6,906 6,101 14,171 11,713
========= ========= ========= =========
Diluted earnings per share $ 0.36 0.32 0.73 0.62
========= ========= ========= =========
Diluted weighted average shares
outstanding 19,429 19,163 19,459 18,962
========= ========= ========= =========
Consolidated Balance Sheets
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(unaudited and in thousands)
September 30, March 31, September 30,
2004 2004 2003
-------------- ------------- -------------
ASSETS
Cash $ 5,318 4,314 3,133
Gross loans receivable 349,402 310,131 283,485
Less: Unearned interest
& fees (84,136) (73,603) (69,228)
Allowance for loan losses (20,421) (17,261) (17,053)
-------------- ------------- -------------
Loans receivable, net 244,845 219,267 197,204
Property and equipment, net 9,634 9,274 8,238
Intangible assets 17,484 15,514 14,304
Other assets 14,785 13,600 12,576
-------------- ------------- -------------
$ 292,066 261,969 235,455
============== ============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Notes payable 110,300 95,032 97,432
Accounts payable and
accrued expenses 14,673 10,357 5,148
-------------- ------------- -------------
Total liabilities 124,973 105,389 102,580
Shareholders' equity 167,093 156,580 132,875
-------------- ------------- -------------
$ 292,066 261,969 235,455
============== ============= =============
Selected Consolidated Statistics
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(dollars in thousands)
Three Months Ended Six Months Ended
September 30, September 30,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Expenses as a percent of total
revenues:
Provision for loan losses 22.7% 22.4% 20.5% 21.1%
General and administrative
expenses 53.3% 52.7% 54.5% 54.4%
Interest expense 2.1% 2.2% 2.1% 2.3%
Average gross loans receivable $340,829 $282,578 $331,614 $276,957
Average loans receivable $258,705 $213,684 $252,119 $209,822
Loan volume $251,030 $209,008 $502,272 $417,751
Net charge-offs as percent of
average loans 15.4% 16.0% 14.0% 14.7%
Return on average assets 9.7% 10.4% 10.2% 10.1%
Return on average equity 17.0% 19.0% 17.7% 18.9%
Offices opened (closed) during
the period, net 31 13 49 16
Offices open at end of period 575 486 575 486
CONTACT: World Acceptance Corporation, Greenville
Sandy McLean, 864-298-9800