WRLD - Earnings call transcript Q3 2019 | World Acceptance Corporation

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Operator

Good morning, and welcome to the World Acceptance Corporation-sponsored Third Quarter Press Release Conference Call. This call is being recorded. At this time, all participants have been placed on listen-only mode.

Before we begin, the corporation has requested that I make the following announcement. The comments made during this conference call may contain certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 that represent the Corporation expectations and beliefs concerning future events. about are are risks subject statements uncertainties. and forward-looking matters inherently that to Such those fact statements. plan, of those than similar any other Statements historical foregoing the the will should and anticipate, variation may, of identified are as words estimate, believe, intend, forward-looking expect, expression and or by as well

time the obligation or results subsequent this not to XX-K March differ in from Chad XXXX, Additional and information any discussing to and Prashad, President to filed are to ended performance to statements The from paragraph such XX, Chief floor factor reports that undertake statement expectation Officer. is host, forward-looking section it Corporation fiscal turn At update recent in or press does expressed implied the makes. statement or regarding forward-looking the statements could in it forward-looking over Form Executive cause furnished the Corporation's any most the any with today's pleasure year actual my and time. release forward-looking time, the of Risk to SEC included for and earnings the Factors in your

Chad Prashad

joined and transcripts. our and This to earnings the Prashad, morning. Chad all some I'm Johnny you've General the had Counsel. of Umstetter, QX and Chief time Luke absorb with President is Acceptance. World also Financial Good and Officer; release here Calmes CEO Strategy I trust

I'll go this time open up any So and at it to ahead questions.

Operator

now ahead. Vincent from go Caintic We Instructions] from will Stephens. [Operator take our you. question first Thank Please

Vincent Caintic

morning, thanks. guys. Good Hey,

So a couple questions. of

program. of how you your aggressive on rate in buyback buybacks? of program. share with kind put get want a And the to can you buyback share get you think to in you what to be can do to terms sort leverage started wondering, order of run levels share full you your of So I'm

John Calmes

Sure, yes.

shares around and yesterday amount fair we -- buyback left We So bought authorization. have on XXXXXX the repurchased we have we've back the a through program. started

around now back current $XX performance. $XX that there's and buy balance that conservative the and debt of is authorization we always felt the debt-to-equity million So terms. our We've sheet for said we million can left X:X like fairly on under

level and going to that get just monitor we the we're as So and much along comfortable we'll to try market as can.

Vincent Caintic

Okay.

a Or a So assumption of get is there? how a you started. do? do you'd to like get have the when like sense to of there debt you'd sort of trying pacing Just quickly to sense

John Calmes

in limit purchase. we're how So to Sure. the We'd much limit volumes a but market, purchase we under quickly on by the possible, daily daily like the there's right? much we -- of get as limited there a as on how can can

to having capacity govern obviously the buy facility. to some how back debt extent well access will that and much So as as we of

Vincent Caintic

sense. A that ones. Okay little other makes

seeing and we if been thinking be kind where reserve you a about it's us -- where credit an the tough from forecast going at maybe could then new nice the losses and kind where So going customers. level. give about what also you are level since could just should us be look wondering us been a appropriate think should we growth you On little forecasting when sense I'm we just forward here? some forward of of levels you you of should think your what -- model to bit forward trend give credit you've should think give a reserves in a losses

John Calmes

Yes.

new mean hard I that will customer determined a right? be a it So project, of So lot to our lot it's of by growth.

you level growth, provisions could off the expect same we at it customer growth our if level. to continue higher or we new to the well. if growth, as provision Obviously them off to accelerate level customer the keep were drive could in in So new

we'll customer to new say the knowing sort have what hard it's certain of for without So future. in growth

Vincent Caintic

Okay.

So Would you the guess to comfortable growth? loss rate end. XX% quarter order be try sense forecast where higher of on going any you terms thinking is of maybe we in get to level? how charge-off right that to this our that that to in the try about you're Just rate sort you provisions I be to want had the can

Chad Prashad

Sure.

impacted in XX% that growth for customers. loss this And new mentioned we investment new by had going rate tremendously as forward. in customers growth So quarter the John a good is believe the is

there, last loss rate last we for year's So forward, you from somewhat long it. rate, growth But to to look the be if investment acquisitions continues as we look if it's opportunities over whether it's a through organic the or this think to good we'll increase it invest year, to loss other it's continue and is going whole quarter. good as continue and in the you grow that portfolios and believe see marginal. year's return at we of substantial And fairly at

believe similar long to a continuing to we're as I rates that would good at grow loss investment, it's forward same expect as we going extent So the the still rate. to see

Vincent Caintic

portfolios like there what's makes Okay. been has portfolios? of of been any pipeline -- acquiring is specific a And portfolios those That characteristics acquiring? you that The you've the you've sense. good could been there describe

Chad Prashad

we've this we fairly is XXX as So the past us. for prior down the footprint also that to that years our clearly be acquisitions portfolios that. ranging taking probably down tends within are to as common what new portfolios The to to -- states We've well that XX are XX acquire substantial enjoy XX stores our last to third stores. fiscal year up done taking in theme compared over of

our but into we So which XXX last our Utah, within also quarter stores current state, in we acquired stores helps expand acquired new a nearly footprint footprint.

Vincent Caintic

Great.

run year-over-year the investments for the also and wondering of and for terms XX% good kind you're G&A When one I up just the rate your there expense? if the staff last just higher sorry the in to I'm get going were and in that's marketing you've me But driver forward. guess And your I'll -- increased of that making a queue. any Thanks. about levels. Is expenses think reason

John Calmes

a and included lot increase driven that Obviously, to plan a in that of long-term we've loaded. earnings the release schedule front-end Sure. the was by how is show

so -- added So we XX the you'll six the plan headcount we Chad see that look add years new significantly. its over have XX also during we've de novo at expense year. the next acquired When we've related to XX increases the year. locations said had headcount, during decrease as to offices We've

that, careful to same time the along our been on accounts managing comes employee. we've that headcount but there's with at focus So, for

our accounts have we in So improvements the increases in seen employee we've seen though even headcount. for

good our about is we'll feel we try efficiency. continue that focus accounts that to and effectively on and improve So and employee which for our

we new So can money out spending good there's attractive some customers. we and with opportunities feel acquire feel expense still to comfortable at customers market there like that acquire we returns and

Vincent Caintic

Thanks much. very Great.

Operator

Thank you.

is next Our from from Rowan Please John question Janney. go ahead.

John Rowan

Good guys. morning,

John Calmes

morning. Good

Chad Prashad

morning. Good

John Rowan

next easy So year? first. for one Tax rate

John Calmes

range. the So yes between long XX%, we term XX% think in

John Rowan

And Okay. now…

John Calmes

But us it's term bit settlements -- so and It lower tax down. that long think a we've XX% to have we tax state some rate little favorable been it's that just still XX% had driven range. in the year this was to

John Rowan

Okay.

place? open not the us sub-X an can period theme frame year. comments investigations There took to comp has help plan less been $XXX repurchases? the same can whether looking -- still are million million history which ratio What a have debt-to-equity guys million X:X stock you there it It use that worth we've we a did we was guys How the I or because large This your debt-to-equity with stock a of buybacks comfortable to in do in back up a go out $XXX a going are about a buying relatively you your before. are heard was and availability see the the this share to a around year slow of per fast, to in time Just of it? from How lenders years it you're example levering X. can period timing the and go Mexico revolver? you almost back mean, -- at to be as of $XXX XX with few be here. ratio. Just

John Calmes

any But we to get Sure. intend of know sort we of that for some as get so back you on market fast right? can. hard don't get Honestly, sure, out when uncertainty timing and and are there. back So we control it's there's we in X:X and certain say is there's on the that can all give to as we idea things to that our

John Rowan

Can me revolver? how you your remind on have you available much

John Calmes

now are right So the commitments $XXX on million… revolver

John Rowan

Okay. Is there.

John Calmes

Yes. say. I'd roughly …

quarter. flow our We our fourth is have quarter big cash --

come the you'll see to over that we'll March outstanding million was by $XXX so quarter And XX. where the fourth down during -- in course the debt and about the quarter of the see

John Rowan

remind you you pacing if timeframe any there me of to payout right earnings mean, related required go there's any under the accretion? Or to can ratio million just in covenant I to speed is up necessary repurchases? $XXX Can lever covenants? generate a

John Calmes

Yes.

that restrictions payments are buybacks on part of there or agreement. our So restricted

consolidated limited of are XX% income. our we net to So

quarter. consolidated So that it of as add that right under still $XX -- But to now we'll have we've of so we'll our we with spent add to-date, left to what clause. million each XX% income

John Rowan

right. All Okay. you. Thank

John Calmes

Sure.

Operator

Kyle Joseph Please Instructions] from [Operator you. Thank next from go Jefferies. is question Our ahead.

Kyle Joseph

Hey, But we question. Thanks over of table year? the there my regarding sort them to taking there. morning, And payments? question the expect Or appreciate a to seasonality stock-based can is throwing just in comp out be related those kind in of for modeling spaced guys. evenly you that any

John Calmes

investing was a be great decrease, see will So every on right? you'll the October. XX it's so grant Well, it months in so

run based release. calculate sort in the through the in next then or the stable will included quarters be for next So and clips So and it and and on be able then through again, right? be of we there. QX to staggering the of But some year information then rate should four drop then earnings that there's steady will you drop steady

Kyle Joseph

about you to a talking Got it. give for target of sense the And were acquisitions? your pipeline going you the back us sort can earlier, given acquisitions

Chad Prashad

yeah. Sure,

well. So medium-sized acquisitions over acquisitions several the past XX months, reviewed very we've as large some

price We thoughtful down are couple we taken and so them how of smaller the ones. on a very we've

I fairly large ledger. yet in say haven't the mean do review When they large $XXX a deal. acquisition I But million $XXX we market million, and are We regularly. in secured them

the a haven't in what's of being seen slowdown least I past being over the year traded market, or at So marketed.

indication over In decent next what's so fact, an that's there over year and out last uptick XX the fairly there assume the fair probably it's an pipeline XX, seen to two say is I we've we months think over a years.

Kyle Joseph

and underlying provisioning for we Got it. going those health like. credit performance of then to But look customers a if sort back of really impact if understand, And and give consumer? the x us of you recurring how the out at borrowers the to sense sort Thanks. your new could could

Chad Prashad

Sure.

close have up portfolio around portfolio new So new the grown XX% and is Really of perspective. the I actual credit the for major customers just sheer returning provision which of looks so probably customers from increase believe our of and the increase just to customers stable fairly year. historicals performance compared to the of over and much have growth the growth customers. score Two the provision. from in past around one in perspective in weighting that both increase overall the XX% a two drivers is everything been makes existing entire

impact that overall So XX% is which just new up due other you XX% if things, to could somewhere the larger these really cetera, acquisitions to. economic There be about, at of that our increase around there customers. of of been but It et the these about sure right? increase and out So one look the that's what them is portfolio. so we're provision due has some on taking conditions be could creating, ends that pulling into overall not that's

Kyle Joseph

questions. Thanks it. very my answering much Got for

Operator

closing or are I would no conference further turn Mr. appears questions time. to you the this for to any there back remarks like additional Prashad. at It

Chad Prashad

us today. Thanks QX look call. joining for everyone joining next to for our and This forward earnings time. Thanks concludes XXXX us

Operator

Thank for participation. concludes the your This World Corporation you Acceptance quarterly teleconference.

now may disconnect. You

World Acceptance (WRLD) 31 Jan 192019 Q3 Earnings call transcript