CONN - Earnings call transcript Q1 2022

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Operator

Good morning and thank you for holding. Welcome to the Conn’s, Inc. Conference Call to discuss Earnings for the Fiscal Quarter Ended April 30, 2021. My name is Melissa and I will be your operator today. [Operator Instructions] As a reminder, this conference is being recorded. ir.conns.com. dated morning XXXX via and Investor website release market distributed the earnings Relations this opened can at company’s June was X, before company’s The be accessed

call other certain differ you are their During cautions represent company the a these These financial materially which risks to remind assumptions, and today’s I to reconciliation some concerning forward-looking earnings which the statements share. earnings of the diluted most today. non-GAAP the measures. securities statements The on of statements refer events. that per will within are cause subject must issued such release call, discuss that adjusted beliefs the forward-looking performance actual adjusted was comparable uncertainties, net of or management results GAAP measures, future that in federal income from and to meaning company’s statements company’s to this are could indicated Please expectations present measures those among based today for laws. necessarily made

go are sir. speakers over CEO the Bchara, to George the would the Miller. to CFO. Miller, I Mr. Please Your and company’s now call company’s like Norm today turn ahead,

Norm Miller

ever trends per best to sales years the recent quarter segment Good growth adjusted initiatives and XXX-year diluted and health quarterly call. net we performance morning credit earnings of stimulus. is success X our $X.XX achieved. over strategic of combined welcome underlying history, team’s government pursuing by growth most fiscal in The with to These business share. in which the stronger highest record strong, have year same-store first demand and XXXX conference our drive earnings extremely our generated profitable earnings Conn’s We quarterly the reflects driven that our consumer

reset operating credit benefits business. to prudent year’s actions and of de-risk retail the demonstrates last our performance and strong Our

risk. while retail As well-positioned are to we grow credit COVID-XX the from controlling simultaneously emerge sales crisis, we

achieving to retail progress Compared X-year period the significant first total We this sales same have goal increased expectations and recent as exceeding execution encouraging. quarter, fiscal sales strategic increased single-digits. remain will and I believe We during year-over-year achieved sales to by and were of month fiscal continuing proposition Early and sales in our by to strong demand, capitalized of team robust underwriting our to of Same-store for quarter quarter. of indications made and the expand quarter the and Conn’s offering stimulus are sales. last expanding XX.X%. growth this for response And sales first in-house government Conn’s our believe credit the third-party our our the consumer high rapidly speaks up be the during a year, basis, financed value We continue pursuing by on government ability market. benefits throughout XX.X% the remain initiatives. growth a to our our retail lease-to-own target XXXX Conn’s on are strong while business X.X% milestone for a We I May, due third-party I opportunities first our segment first same-store were quarter in sales approximately at the XXXX a particularly reflects year the XX%, performance sales grow same is same-store a same-store meaningful occurred our second e-commerce past re-aged credit segment omni-channel in-house benefit Customer we believe opportunities am our quarter we Underlying plus to diversify as grow positive. strong of in-house the stimulus declined larger and and offset from driven our to credit have XX.X% customer the and pandemic. despite conservative expect business. significant the strength performance. customer our decline up increase to be long-term by evolution improving believe credit base benefits which and at pleased annual our and accounts waning retail well-positioned a in in credit XX, up XX.X%. sales, by to as time lease-to-own declined addressable we the XX strategy initiatives. and by we and April days trends accounts robust

progress offerings; our leveraging customers; So pursuing expanding to consist with four our our look better business and the serve strengthening growth footprint; we retail industry strategic credit let’s capabilities. at overview, leading initiatives of: our digitally this making transforming our that meaningful in-house our brick-and-mortar and are third-party

to offerings. want initiative we our I progress are the The making, strategic leveraging first review today is credit growth best-in-class

strategy and sub-prime credit spectrum near-prime between and third-party prime, our enhanced optimizes the consumers. us of opportunities across Our partners

managing We With within our core the demographic share expect a underwriting within wallet credit believe in-house come prudently risk. we of offering capturing in-house further customers by credit segments. demographic offers credit partners, drive In the customers higher core while our growth our and the our success XXXX, from of of current strategies this the platform grow credit of pleased began additional to integrated will than we credit am spectrum. to sales testing strategy fall of early credit efforts. greater of I quality down the approving sales rather

approach trends increased added is we and Lease-to-own to strategies began fiscal the strategies FICO further reducing customers strategies in-house quarter credit our average or by April, supported believe reduction the in us We we quarter. we million XX% year-over-year. have of have controlling COVID-XX us more the initial to time associated in of by sales while accelerate score lease-to-own expanding quarter. the recapture lease-to-own post-pandemic expanded in-house due at efforts in and the our while last last to credit we confidence same encouraging volatility. continue to enabled will first to partners these significant with to and crisis, origination year grow credit we customers experienced levels these more tighter to allow a higher overall these Following second risk In the this sales same-store at The XX% portion test sales, year. results, the these underwriting portfolio $XX.X maintaining

sales to We in support continue sales year growth momentum retail our in expect year fiscal the total and XXXX. throughout lease-to-own

We also retail underway consumers. experience and prime card trends capture Initiatives with we of from have to and an more credit favorable are believe long-term we meaningful customers continue to connect expanded cash sales. population opportunity to a and

Moving e-commerce on to plans. and our growth digital transformation

pleased a our Initiatives e-commerce the improving and expanding and team accelerate to of platform flexible our include to are consumers direct-to-consumer e-commerce quarter convenient, continue experience just in we $XX.X sales provide years over across last making and XX% am the platform, annual increase and I sales personalized X period million, with capabilities. year the all over We progress digital and e-commerce first engagement. channels Xx digital our fiscal were our investments enhancing a ago. functionality with of e-commerce same

to focus serving next to e-commerce they and $XX where plan year million. to strategic we this choose shop, our on and we increase customers believe significant component is can of double our opportunity. The space store over how expansion white growth our we As continue sales again fiscal long-term our

showrooms, as the the total to we quarter, During the state of X of XXX first new of number showrooms growing including within XX, Florida, X April opened XXXX.

expect fiscal plan and new expansion our a unit showrooms. increased year current the XX new now for have open XX total to We to of

our we from enhanced our of becoming and in we final Strengthening retail subside I focus during programs, our believe first for strategies. more products. impacts benefit we expansion capabilities I progress our COVID-XX the competitive am retail position and the well-suited home-related are our of credit consumers’ initiatives on made our strategic is growth As and crisis quarter. the strategy and retail encouraged Overall, the improving the confident is by geographic component is

refresh broader DREAMSPOT, to assortment private we our offerings. which for office, includes in posted first work-from-home brand product best-selling which lapped to mattress our quarter, become drive recent including traffic brand, quickly name positive year during update excited and categories and first mattress. XXXX, customer of am to our distance sales. of except we carry, label all Throughout fact, and base. also home which a spike last products announce This that the I sales In continue a mattress-in-a-box our appeal we categories will fiscal learning the launched same-store expanded category, year’s has to revamp

increasing higher margin this appliance appeal enhancing broader and category furniture a selection Additionally, sales our incremental product we to to our within our drive category. assortment within customer are base to

quarter sales Finally, and inventory, TV as are benefiting electronics offset allowed from industry-wide dynamics. still the while more the inventory sales pricing and available. improving pandemic of become hardware videogame retail consumer COVID-XX to continued associated with us during and performance sales has The chain supply strong constrained, challenges higher

help well categories. of to most our bridge as an job working Our inventories secure are excellent until inflationary opportunistic product buys gap on across we to trends team our doing recover. available also with of vendors many as working our is experiencing the Like retailers, begin share to

of closely segments. continue monitoring are progress and am impact are we making to will business We Overall, impacts necessary and with our our taking across the and the customers. pleased on mitigate the steps its we I retail credit inflation

successfully more market and experience centered larger seamless believe We our a website. diverse around is creating are omni-channel and showrooms capture customers, shopping on of to our both addressable within a consumers, us allowing which we our

in-house having us believe we further addition, and competitors. capabilities day delivery our local service next presence, distinguishes In a from

well-positioned start year to continue fiscal and remarks, our outstanding believe off to are sustainable prepared my to create conclude long-term to So, XXXX for value is shareholders. we we an

continued amazing of the for team, our your On Finally, possible because success and of service. hard thank behalf and only our commitment entire dedication work leadership associates. is made of you the

George the to turn Now, to me performance. call let review financial over our

George Bchara

operating per quarter issued release adjusted non-GAAP the reductions. million of the sales available year. first SG&A the diluted last as financial of $X.XX measures to COVID-XX-related higher XX first variable for this loss Reconciliations million On reported share share positive are as lapping GAAP in was $XX On of due credits, certain reported period Thanks, the start the the for fiscal year. to share $X.XX the total and $XXX.X Norm. by increase of last period for year. underway were our strong I net per record for and income adjusting revenues same basis, an the quarter same year of share Consolidated net first compared growth quarter of period that We showrooms the for increase well of loss a $XXX basis, consolidated $X.XX with $X.XX XX.X% fiscal our certain new the diluted to quarter diluted diluted million, the prior were press from same a am from expenses the first per associated a earnings to GAAP non-GAAP a morning. we charges business. year and fiscal for last encouraged in income to representing first by expenses quarter, for momentum compared the addition per a

We expect in initiatives. SG&A a stores expense to on continued growth driven tighter we basis, by controls to primarily new largely cost more as X-year investments be up expect offset our

lower as due the more decline our at income. increase RSA increase retail from of revenues Retail margin in Higher same-store a detail. million, was period Total larger commissions financing. the retail retail offset retail lower for income, first partially XX the RSA XX.X% a of fiscal sales, partially gross of and quarter same and segment retrospective an driven from first by of for and XX.X%, year. retail mix increase profitable was new basis in-house quarter last The same by offset to fiscal result revenue in period XX.X% increase more store was were commissions a year. last Conn’s retrospective the Looking of sales margin in points $XXX.X by sales in growth, an and gross a

year to income be higher We sales expect margin. and last fiscal margin to with fiscal higher gross million segment Retail operating $X.X due the million the in line retail $XX.X same to prior retail year gross compared the for roughly year. current in period retail was

was receivable of quarter. Turning fiscal of charges XXX and credit credit a the points in-house income a portfolio our of an decline income. the of Finance for the reduction commissions same lower to last interest period. XX.X% increase portfolio, insurance in the fiscal yield million year the in result from record prior XX.X% average the a sale and balance XX.X%, balance to receivable of a our fee customer year revenues segment. decline $XX.X the the due retrospective Partially basis insurance and in offsetting was period were in of decline The other first financing, decline from customer

finance For current charges due the customer expect be we a year-over-year a fiscal lower down and revenue other year, receivables. basis, on balance will of to primarily

in credit part year. improved quality significantly portfolio the we past prudent the months, due last actions to of implemented XX has Over the our de-risking

remain years, XX.X% almost level accounts to value days past carrying level year-over-year our long-term in our declined years. the strategies risk, the controlling As limiting portfolio am We to a X,XXX lowest value X supporting trends result, growth spread and in the the by volatility business. and XX lowest X basis improving receivable declined fiscal year-over-year of fiscal I credit due while the re-aged accounts of carrying underway customer XX.X% encouraged of annual points on and focused achieving and credit opportunity, in

year to economic our During the compared million our in quality, to year-over-year reserve last experienced compared year. of the $XX.X quarter, economic first The lower year. increase last the benefit to release provision charge-offs expense of improvement for and first quarter this in was debts $XXX.X an reserve our we million improved to portion due bad a of credit

down to a throughout improvements in quarter, primarily and the provision year-over-year credit in first the current but outlook. our level receivables, fiscal balance of encouraging saw year, due to economic expect be we quality at the We customer not lower an

As our rate financing, in-house than a a will provision our long-term, pre-CECL, CECL reserve portfolio result as build debt. grows the a our result reminder, sales which at of in higher may as bad higher for growth in of under over

remaining decline performance, debts decline detail, in approximately quarter the driven XX% bad in improvement was our reduction the at forecasted in was improvement during and of portfolio, first an Looking allowance size the portfolio approximately the rates. in by XX% more XX% for the was by a unemployment of an by driven driven in the our

provision first Credit primarily of the segment to X.X% last quarter a million, the period was to income performance expense. for interest spread the for record and last lower credit due in X.X% operating credit and quarter improvements quarter Our the X.X% compared $XX.X same was first year fourth year. and benefit, for

and have sheet to cash we cash from an in extremely now and collections on strong over Turning which continue our growth as operating balance our sheet our quarter robust finance position. sales, sheet. produced This as with benefit We past third-party our of meaningful quarters has balance customer we ended a to used five the balance year-over-year capital portfolio, and and the underwriting. fewer to first position cash debt originations capital strengthen result and flow significant tighter reduce

first in near-term us the the and senior XXXX, balance compared our with debt quarter, that of optimized we in which year. left structure, million notes our with remaining at has of $XXX no first During $XXX.X quarter debt the last maturities. the balance redeemed We enhanced $XXX.X end to the capital of further million quarter ended of our net due were million July sheet first

of had the and months strategic the strengthening at percent addition, of over to to around company balance a success our ending of de-risking quarter balance the proud have In business we debt XX% compared sheet, representing portfolio approximately repositioning as declined first XX% the years. end extremely past four our at of the the the the our approximately and first last the I’m growth lowest net initiatives. quarter year in X level of end XX

Norm we so of As we strong in year. his encouraged underlying mentioned far are the business and our sales prepared experiencing by strength momentum are remarks, this the

currently expect this initiatives. of strategic opportunities macroeconomic waterfall we uncertainty same-store credit we year high, execute our be single remain up As demand fiscal and to across a in on key half as the digits the result, and our high back while growth four entire pursue sales year

for my up team we dedication. all share to to members service I thanks hard and want continued their call work, our open questions, Before the to

happy please to the and your are open I to up Operator, call take Norm questions. So with questions. this overview,

Operator

[Operator first & Instructions] Oppenheimer Thank question proceed Company. line the you. Brian with Please comes Our from of Nagel question. with your

Brian Nagel

morning. good Hi,

Norm Miller

Brian. morning, Good

George Bchara

morning. Good

Brian Nagel

off, First quarter, nice work. Amazing. really a congratulations on strong

Conn’s to So you here. efforts the mean, cater again bit today. talked I I questions it talked a Norm, really new and a about One, mentioned – have a of we’ve customer, here few bit we a to

back pull sense don’t efforts into continue that do some normalcy. customers Conn’s or utilize to like you to out the we and will the credit? get look crisis, – newer use those customers, to or what society look to How speak of an we of and this, to economy Conn’s not COVID As of the the cater to hopefully, are

Norm Miller

Good question, Brian.

quarter next-day proposition addition in customer, cash So one we our of And has attractive pandemic, value for some our cash, customer. – our you, as of proposition the pricing, and as that to things lapping Conn’s that third-party previously the caused pandemic pandemic saw realized, that finance in our year-over-year service, have last XX% you of we is, first and about the that, that mind lease-to-own. a value this numbers is prime the And card we’ve financing were talked the increased sales customer unfolded, in-house has underwent our quarter. credit delivery, as growing because year in very quarter that with of the the with

the from stay in past quarter tighter over the a standpoint, here, Conn’s declining the is And very past year back can that those months. not across excited into that is down only taking – our business portion underwriting, because pandemic. additional our were some a that second risk marketing now believe significantly end of the in about we credit underwriting Conn’s of the know, focused started of quarter, we’ve there customer, coming just capture throughout here XX% the but continue we customers first do the believe finance the believe and at merchandising we out continue plus significant we was because can the market tighter to And XX spectrum. you So as capture what and we we the to we over addressable on we’re

mid positions partners, of balance of addressable simultaneously combination forward capture us much market higher And of extremely to spectrum the larger end this larger the well going lease-to-own and we much not in – card. market the cash conjunction lower So this and now the the at with future. into but can Conn’s only in business that we back believe that lease-to-own of addressing believe with of year end, we with credit while new that the here, end credit lower for the

Brian Nagel

helpful. really That’s

As a guess more focused follow-up, credit just side. the on I is – this on

understand. we this So

take I your where started you’ve said, so tolerance, benchmark was much say, where then take, way So mean, to there what risk was And so is how that credit that? you to like to stronger. And to a it? operation it further Is go? the risk more – it on. have to you’re the saying follow-on does because I even have I is now that hear now

So better. risk out to but you’re that able more taking risk, manage even you’re

we how key think I then on? any, how as but watch, on So take some recognize you metrics even long-term you it be whether something of about – guidance think, else? track more we those should should given delinquencies XX-day How haven’t I risk this, the credit or

Norm Miller

question. Yes. Again, Good Brian.

when that we’ve go the quality partners customer the we’ve more with or pick don’t we’ve So taking here more credit that them the what’s gone risk, added, reason two deeper with that we letting as that to risk that higher – have that past, have down our past. customers And able Conn’s in in far we’re able lower credit spectrum. to reason taking we’re do the the doing risk that than is exciting taken the because is lease-to-own we’re up we’re lease financing as really credit in the spectrum we’re – we quality credit

at looked at was – see Conn’s to higher credit it we’ve on are quality FICO more going with you And with Prior you XXX that pandemic average. about FICO can the Conn’s for financing, dipping the the that just credit our what a And that ran at with that FICO that XXX, we’re score take scores not the our running if FICO pandemic, started higher Now say scores broader an underwriting quality. scores. XXX, about during the tightened risk And XXX. I to down. broader now

up And what accelerated than is at staying on less degree our in reason higher lease-to-own the partners the And was partners We’re in actually here we do can were which capturing have that ever they quarter that’s because up is that much why the are because XX% higher a at scores. that quarter. those in FICO business, lower the it’s lease-to-own risk fourth taking first history. XX%. the our And lease-to-own

we I and can the strengthened lower partners. those Conn’s So also the cannot we cake can lose eat with much have our on partnerships on quality get the too. lease-to-own higher side, because it hate customers – but the to side so credit this, of but have our credit quality can two We the use of addition

at that as has here, portfolio arguably, as stay been any time focused the company’s and down I As the time credit today history. look if sits focused in delinquencies, in my would XX-day been in far as I on, clearly to at are you metrics the years materially. in delinquencies, on look, And that it’s they as it would in encourage never the is stay condition any X investors good

troubled down they you TDR, at well. are re-aged restructuring down lower materially. look are significantly debt Charge-offs materially. If as are moving accounts down accounts,

financing, lease-to-own forward, higher expectation while growing partnership end look our the maintain metrics going the spectrum the as well. Conn’s at as very at you a can is as business portfolio of we strong well that through if those simultaneously So, credit through credit

George Bchara

just is when means that what we talking would that, higher about Brian. not risk, to add it about I here. This is think taking Thanks George. That we more sometimes, are losses.

going are going the on higher rather customer dynamic a credit more the are are where down to of capturing further of of spectrum. share – wallet growing financing deeper without referring sale our of Conn’s we losses our because we taking credit are in-house actually than higher quality the We we the

Brian Nagel

and you Well, thank it. Got congratulations. again

Norm Miller

Thanks, Brian.

Operator

Thank you.

Inc. with Stephens Our next Nelson line proceed question question. comes from Please with Rick your the

Rick Nelson

credit follow-up a on a year. I impacting risk that’s the strategies, of in am To in-house Thanks. driver the with new more great same-store steps Good book, how how my much payment and to credit taking example? for start its are new to of customers for sales default, those the curious and congrats morning some

Norm Miller

Yes.

So, look X% April, the had. we results, same-store with the down at that saw April, month were the Conn’s sales will was finance I saw if – still sales you, you Conn’s we were financing you tell that sales it for our actually they quarter year-over-year first performance just positive year-over-year. of

we as when were started done of benefit So, in about to more Rick, taking with – It’s the spectrum, again, say credit quality. capturing the it’s risk, we historically we which see we not further have the credit down what more the past. is higher wallet

lower taking actually from probably are ever because strength of of down lease-to-own have the risk financing partners. we less the We Conn’s the spectrum credit than

business capture which broader to of because the go their at them spectrum. enables letting of higher profitability the are We model, end that us

is indicator But are during maintaining you strong seeing originations from when which pandemic, score performance for levels we a saw have FICO, FICO extremely that record mentioned our that As models. seen we at on with and look financing this as underwrite portfolio seeing. far high as credit Conn’s of as this with pleased scores, the from very at an FICO similar overall call FICO, you we FPD, are prior credit what quality, Brian, we I proprietary – have are and to obviously, specifically underwriting And our own the initial delinquency we don’t with are portfolio. a if is we we an

Conn’s to finance quarter incremental while sales here level. expectation going on the risk can second do in at credit the the continue we our acceptable is maintaining an of balance that capture year and through and So,

Rick Nelson

see was thoughts Norm, the credit with new XX% thoughts, quarter? going where Any on strategies? you this will sales the how of on Any that

Norm Miller

Yes. internally. Good balance are focused of sale. Rick, not is as will you say are because focused we the much we know on question, what I as And –

that sales believe of is pre-pandemic, we What can those spectrum. letting deliver as What I of of our segments has to Conn’s financing back the or it from credit don’t levels, our ever are falls. primarily what financing balance We to don’t can have other grow it Conn’s level it cash grow say get over – at to materially on expectation to can be the I a high lease-to-own credit Conn’s continue sale we at one fall We XX%. is is want historically. as wherever expense grow was expect because to We well the north taking and double we we quality do of grow credit cash of been financing. want lease-to-own. higher to and would card

specific credit And of again, the question. your expect be a are mean, day, to long not consistent so the financing of basis on the but answer with spectrum. – between going at lease-to-own a would XX% Conn’s that’s end a and I to But targeting and I somewhere BOS XX% LTO we forward. our or any

want options. we whatever works agnostic grow them. to And able believe segments. can are to in we want is a from they customer is our option, option what We – able be we for or multiple want them, many be a Conn’s provide standpoint. online. – option, works be the of our all it to Synchrony lease-to-own. credit mindset to have X And to provide whatever them customers’ cases, They Our for they a in we a best store We have may

Rick Nelson

for sense. Thanks makes That that.

year-over-year. receivables, in and new follow-up. So, to that both I of that to customers? higher-quality sequentially attract part significantly like strategy these stepped up pretty Is know the interest

George Bchara

a share our of It’s that through us is. door come credit targeting a customer’s greater it seeing deliberately customer and quality a of combination higher both wallet. Yes,

Rick Nelson

Got lot. it. a Thanks

Norm Miller

Thanks, Rick.

Operator

you. Thank

your Please next Our comes of line the Capital from proceed question. question KeyBanc Markets. with Brad Thomas with

Brad Thomas

of add When look segment, credit adjust you think if continue obviously, good business. and is about business it. and around that, how now Normally, you three was support you momentum have you. the But that to the a on you curious me credit feat. had the of in and I four I financially think you morning money-losing segment let the business credit the going which well where to for been the what going quarter the similar income as both we try might around Hi, it’s forward, for how segment, congratulations are for the overall wanted quarters at company. question strategically, I forward pretax level would a this sustainable the I quarters the to provision quarter line for or optimize P&L my as good all of even thinking segment? last and had big you on to about profitability I thoughts your about here we positive be peak quite a credit what have think retail for might would be really guess a the guy

Norm Miller

That’s Yes. question, Brad. good a

back because are have credit spectrum it So are credit say the both going are different to that very can are because I future we we very here, focused profitability don’t financing we bite – we and focused is, doing road. on a – where, we certainly, historically, an Conn’s And risk issue in spread. going questions we we that in answers basis heard are company side, here X not the am on I And taking out prudently. that in the capture to as necessarily we we are points of standpoint still X,XXX If the what is that what do to really risk we as believe been comments we it with of in deeper we the down as my our here as me comes the fashion are in us don’t a the credit. that the sales of you well some have driving than of from we will are years I taking, want more on in not retail want

intention credit greater our credit capture to go with those that to with a of is quality customers to to us, a lease-to-own push credit – So, on share the share greater Conn’s quality financing with make higher and to wallet risk a lower – for our partners customer.

strength the macro to adjustment the of even going we money potentially be the from – adjust profitability. an tailwinds the you are and create Now will when you it because of are happens, right, that profitable. business the portfolio the for created from change, for portfolio, opportunities a allowance performance credit nice if of to not Because make that and

say bottom have the the I business there going opportunity to for the opportunity a make that do grow that I the Conn’s us won’t in what the retail say I is side the business in forward. that line that, credit profitability take if would is manner credit wouldn’t and we we standpoint. financing not, certainly take do if is But we is will of house. money then from smart So, to term a

Brad Thomas

you That’s think targeted great. But are How of bit items sales, it couple little XX%. forward what quarter over I in had longer also the the lease-to-own, historically, here housekeeping a and on term came targets you here? over XX% opportunity the And thinking of a to about rent-to-own, the in nature. getting are and going

Norm Miller

Yes.

we that there trying move for several any from, really sale years balance had achieve. away are I Brad, I XX% know We to worked to of out target.

on dollar of the or business. from are that We focused want because balance taking capture it Conn’s another sale increase don’t financing part lease-to-own to we of we more because are

So, what quality our dollar materially, how in and raw lease-to-own our as customers. financing. grow From well credit Conn’s our in a credit more do we the is business, cash are dollars team our focused card standpoint, we as a high and on as business

And bank faster want up. our in We that’s right, our Does if put what to don’t XX%. go that are each is. sale. in dollars the dollars We because sale expectation But of you the sense? make was it the the but up balance down put category dollars. could we of of lease-to-own, go So than go could Conn’s financing actually balance grows actually

Brad Thomas

any And makes the what it there for last impact – sense. one retail perfect it of you Is a obviously credit estimates it an there. We the had with out know quarter way me. the side and a just was probably for to have stimulus sure. quantify I then any dollars the for impact? kind to know on that But were of Actually, unique it’s business? do impossible all

Norm Miller

I business we retail are excited at this has question. balance about Not business, very, But the and to it of is certainly beyond starts say believe the on quantify. credit of model but as have some on the capture in haven’t of the year. It’s this impact with to for are the away to is It’s as would wane looked to different a forward, the opportunity cash it what us very what ways, an a had even as Clearly, side that positive within we variety difficult fiscal portends stimulus the what the unemployment collections inherent we be even impact. our a the of financing goes us we house. for and in year Conn’s bullish it that had sales good and about well side able we both going with very what

Brad Thomas

Thanks great. so That’s much.

Operator

Thank Mr. final Ladies our the concludes Miller this I for turn will any back and gentlemen, to session. you. comments. question-and-answer floor

Norm Miller

across thank to the and stayed pandemic, and stores wouldn’t as comments We all, had year their hard work my quarter it. work. without throughout on X,XXX have call our the open their and hard George’s our of again, that the have through to First I want they associates thank had the echo company we weathered for the

So, thank you to them.

Have our also the in to look forward everyone. appreciate you sharing quarter few interest and second business, everybody’s months. great with we in a a results day, We

Operator

This Thank you. today’s concludes conference.

time. may You at Thank your lines disconnect for your this you participation.

Conns (CONNQ) 3 Jun 212022 Q1 Earnings call transcript