Exhibit 99.1
WORLD ACCEPTANCE CORPORATION REPORTS THIRD QUARTER RESULTS
GREENVILLE, S.C., Jan. 24 /PRNewswire-FirstCall/ -- World Acceptance
Corporation (Nasdaq: WRLD) today reported higher revenue, net income and loans
for its third fiscal quarter ended December 31, 2005.
Net income for the third quarter rose 3.4% to $5.7 million compared to $5.5
million for the same quarter of the prior year. Diluted earnings per share were
$0.30 for the current quarter, a 7.2% increase over the $0.28 per share for the
prior year quarter. The larger percentage increase in earnings per share than in
net earnings reflects the impact of our ongoing share repurchase program. Total
revenues for the quarter increased 15.3% to $61.3 million from $53.2 million for
the prior year quarter.
Gross loans outstanding increased to a record $464.4 million at December 31,
2005, a 20.7% increase over the $384.7 million in balances outstanding at
December 31, 2004, and a 32.1% increase since the beginning of the fiscal year.
During the quarter, the Company loaned a record $367 million in 421,000 separate
loan transactions.
Several key return ratios remained very high during the quarter. The return
on average assets (annualized) was 6.6% and the annualized return on average
equity was 12.0%. Total general and administrative expenses as a percent of
total revenue once again showed improvement on a year over year basis dropping
to 54.5% during the most recent quarter compared to 55.4% during the prior year
quarter.
Doug Jones, President and CEO, said, "Third quarter loans grew $68.8
million, a 17.4% increase from the second quarter of this year. This reflects
the continued demand for our loan products and the success of our existing
operations. The third quarter is traditionally our busiest period for making
loans to new and existing customers and this year was no exception. We are
pleased that the majority of our loan growth was generated internally, with only
$5.3 million attributable to acquisitions.
"Our earnings growth for the quarter was offset somewhat by an expected
increase in interest expense and a higher provision for loans losses, which
increased to $16.7 million from $13.7 million in the third quarter of last year.
The increased provision reflects both our excellent growth in loan balances and
our increase in charge-offs. We continue to evaluate charge-offs relative to our
increased loan volume and increase in total balances. We believe, however, that
the Company is positioned for excellent earnings during the fourth quarter which
is generally the Company's most profitable."
Nine-Month Results
For the first nine months of the fiscal year, net income was $20.4 million,
or $1.07 per diluted share, representing a 3.8% increase over the $19.7 million,
or $1.01 per diluted share, for the prior year nine-month period. Total revenues
for the first nine months of fiscal 2006 were $169.8 million, a 12.9% increase
over the $150.4 million during the corresponding period of the previous year.
Loan growth has been excellent throughout the entire first nine months of
the current year, and has been mostly internally generated. Since the beginning
of the fiscal year, gross loans have increased by $112.9 million, or 32.1%,
compared to an increase of $74.6 million, or 24.0%, during the first nine months
of fiscal 2005. Acquisitions during the current nine-month period amounted to
$8.3 million in gross loans compared to $27.4 million during the prior year
period.
During the first nine months of the fiscal year, the Company opened or
acquired 46 offices and closed six non-performing offices, leaving a total of
619 offices at December 31, 2005.
About World Acceptance
World Acceptance Corporation is one of the largest small-loan consumer
finance companies, operating 619 offices in 11 states and Mexico. It is also the
parent company of ParaData Financial Systems, a provider of computer software
solutions for the consumer finance industry.
Third Quarter Conference Call
The senior management of World Acceptance Corporation will be discussing
these results in its quarterly conference call to be held at 2:00 P.M. Eastern
today. Interested parties may participate in this call by dialing
1-866-814-1921. 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=1196857. 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 Nine Months Ended
Dec. 31, Dec. 31,
----------------------- -----------------------
2005 2004 2005 2004
---------- ---------- ---------- ----------
Interest & fees $ 52,380 $ 46,043 $ 145,722 $ 130,122
Insurance & other 8,939 7,123 24,109 20,276
---------- ---------- ---------- ----------
Total revenues 61,319 53,166 169,831 150,398
Expenses:
Provision for loan losses 16,726 13,731 39,397 33,640
General and administrative
expenses
Personnel 20,285 18,008 59,500 53,192
Occupancy & equipment 3,640 3,121 10,405 9,147
Data processing 512 542 1,524 1,410
Advertising 3,964 3,526 7,262 6,476
Intangible amortization 709 651 2,125 1,915
Other 4,305 3,612 11,970 10,270
---------- ---------- ---------- ----------
33,415 29,460 92,786 82,410
Interest expense 2,142 1,314 5,070 3,371
---------- ---------- ---------- ----------
Total expenses 52,283 44,505 137,253 119,421
---------- ---------- ---------- ----------
Income before taxes 9,036 8,661 32,578 30,977
Income taxes 3,350 3,160 12,150 11,305
---------- ---------- ---------- ----------
Net income $ 5,686 $ 5,501 $ 20,428 $ 19,672
========== ========== ========== ==========
Diluted earnings per share $ 0.30 $ 0.28 $ 1.07 $ 1.01
========== ========== ========== ==========
Diluted weighted average
shares outstanding 18,896 19,604 19,174 19,508
========== ========== ========== ==========
Consolidated Balance Sheets
(unaudited and in thousands)
Dec. 31, March 31, Dec. 31,
2005 2005 2004
---------- ---------- ----------
ASSETS
Cash $ 5,169 $ 3,047 $ 5,192
Gross loans receivable 464,391 351,496 384,715
Less: Unearned interest & fees (117,922) (84,472) (95,073)
Allowance for loan losses (25,471) (20,673) (23,184)
---------- ---------- ----------
Loans receivable, net 320,998 246,351 266,458
Property and equipment, net 10,892 9,806 9,917
Deferred tax benefit 3,415 10,690 9,535
Intangible assets 17,383 17,358 17,021
Other assets 5,810 6,254 6,053
---------- ---------- ----------
$ 363,667 $ 293,506 $ 314,176
========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Notes payable 160,200 83,900 132,850
Accounts payable and accrued expenses 11,385 19,895 5,675
---------- ---------- ----------
Total liabilities 171,585 103,795 138,525
Shareholders' equity 192,082 189,711 175,651
---------- ---------- ----------
$ 363,667 $ 293,506 $ 314,176
========== ========== ==========
Selected Consolidated Statistics
(dollars in thousands)
Three Months Ended Nine Months Ended
Dec. 31, Dec. 31,
---------------------------- ----------------------------
2005 2004 2005 2004
------------ ------------ ------------ ------------
Expenses as a percent of total revenues:
Provision for loan losses 27.3% 25.8% 23.2% 22.4%
General and administrative
expenses 54.5% 55.4% 54.6% 54.8%
Interest expense 3.5% 2.5% 3.0% 2.2%
Average gross loans receivable $ 422,446 $ 362,173 $ 389,107 $ 342,059
Average loans receivable $ 316,157 $ 274,217 $ 292,726 $ 259,643
Loan volume $ 366,996 $ 306,902 $ 954,325 $ 809,174
Net charge-offs as percent of
average loans 17.4% 15.9% 15.8% 14.7%
Return on average assets 6.6% 7.3% 8.5% 9.2%
Return on average equity 12.0% 12.8% 14.4% 16.0%
Offices opened (closed) during
the period, net 8 3 40 52
Offices open at end of period 619 578 619 578
SOURCE World Acceptance Corporation
-0- 01/24/2006
/CONTACT: Sandy McLean, Chief Financial Officer of World Acceptance
Corporation, +1-864-298-9800/
(WRLD)