Lasse Glassen | IR, Managing Director of ADDO Investor Relations |
Jeff Hilzinger | President & CEO |
Lou Maslowe | SVP & Chief Risk Officer |
Michael Bogansky | SVP & CFO |
Greetings and welcome to Marlin Capital Solutions Fourth Quarter and Full Year 2020 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]. Please note this conference is being recorded. the of to Investor turn Glassen, host now Director Managing Relations. will conference your over Lasse I Thank you, you may begin.
full XXXX Good joining morning quarter Corp's us for conference and fourth today for and Marlin Business thank year results you call. Services
Hilzinger, Vice is Lou Vice Financial President Chief and On and Chief and Officer; Senior and Jeff Chief call Executive President the Mike President Risk today Officer; Maslowe, Bogansky, Senior Officer.
cautioned recent Exchange section place Investors to the forward-looking in events XX-K results. Actual and made website. is Commission, and of Risk me remind reports or guarantees factors made United you those the These represent to XX-Q, statements. some in Securities materially variety of Investors today today's will such headings Securities on beginning not statements report also due or be described in only a such on section under website and of Private of the to most Statements current performance statements call, let results forward-looking periodic or posted the the the from and including factors Slide forward-looking Before Act X presentation. in Presentations are the regarding supplemental beliefs available XXXX, quarterly factors. are This are earnings further statements the Forward-Looking Investors of and which under in not under that Company's Reform of Events Marlin's the the described but not Form of the future filed are Litigation include the quarterly differ may Company's at & annual with performance Company's www.marlincapitalsolutions.com. as Such undue implied reports limited are forward-looking on Factors Company's reliance States Form projected
as non-GAAP may of it's ratio. Marlin GAAP respective financial of measures financial measures, call, other that, non-GAAP CEO, a these Marlin's the earnings such refer discuss adjusted description Jeff? efficiency the to Please well adjusted reconciliation operating my and earnings to direct release share to for now and to most turn as per With President various and over measures, the Hilzinger. our including Jeff comparable During measures. pleasure a financial call
fourth of pandemic, throughout and quarter. quarter, in of year. the delinquencies net the levels. pre-pandemic portfolio outlook, am the financial most results. challenges encountered loss with significant supported Marlin uncertainty results month net performance unprecedented of established particularly Good and Despite year continued from an you which the improved in My everyone for key and overview Thank full the and XXXX performance in our this quarter for update results today pandemic call. fourth morning success the fourth Lasse. of our you, an Lou impact mitigating will Financial will portfolio details past additional us and thank year Officer on focus joining highlights business. and conference remarks Mike our Marlin’s the the release macroeconomic during The with Bogansky, quarter the from line COVID-XX portfolio our improvement provide on COVID-XX the of on the of our the December follow Risk and on in our Officer, with fourth Maslowe, reserves Chief I continued and with will Chief charge-offs quarter performance our pleased strong our finished operating XXXX trending in earlier with throughout a
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XXX from end or fourth XX.X% quarter contracts and the of where or million million of working quarter, This is of third the active million totaled the modified XXX the loans. contracts of reduction receivables. receivables, XX.X% XX% modified total XXX totaled of X contracts equipment a consisting total of that As were capital of finance million
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is as believe to to we and trajectory. of the process that, the to detail. in turn financing growth of of now Marlin needs XXXX, safely over our economy like Lou. to With I'd the soundly Risk the valued our well-positioned partners we Officer ahead our meet Maslowe, more to portfolio and our and Chief Looking performance evolving business pre-COVID customers Lou begin recovers the discuss resuming small call
everyone. and Jeff you, good Thank morning
the to performance the with as pleased very in pandemic. are fourth continue our we mentioned, from quarter we the Jeff As of portfolio emerge
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represented XX on quarter annualized Total portfolio dollars third as comprised decrease had of and and basis total X% modified charge-offs daily basis an at in the plus and day finance total quarter delinquency to day very end miscellaneous the charge-offs receivables, and delinquency a and delinquent plus metrics, X%, charge-offs net XXXX. result. loans, from equipment prior perspective, compared was end. an transportation to the was were at X.XX% book increase of declined than basis compared increased basis charge-offs from quarter The than million of receivables average XX XX delinquent finance which day down leasing. portfolio, finance XXX,XXX delinquency from in the a dollars. million up fourth The At combined we've receivables total while and as portfolio. quarter Despite of weekly Aggregate and of XX or sector modified the this the at December Marlin's was from compared seen of year-over-year. equipment capital to delinquent in the capital modified customers May. year-end. X.X% prior delinquency plus X.X% quarter fourth basis the XX% basis, payments, XX the and continued Delinquency at of the are on peak lowest portfolio, prior driven business X.XX%, was quality were percentage codes, related delinquency industry finance annualized delinquent the basis portfolio of in XX in non-modified highest quarter-over-quarter in receivables better percentage X.XX% services, delinquency Now, which points portfolio X charge-offs the expected Miscellaneous of compares or points decreased of respectively, X.X at and XXXX to X.XX% by was while up delinquency below repair modified of plus to lower rental basis XXX,XXX modified XX Equipment the in a concentration total down Many X.X%, looking to and services now industries, X% to on end February largest Equipment the the finance basis XX X% significantly fourth quarter the X.X at annualized performance. portfolio. to points in the basis. The XXth, since of quarter XXXX. is the non-modified points working points XX% The XXth. of retail, non-modified XXXX. Transitioning is quarter delinquency services working plus as of XXX unable improvement which modified in XX including prior X.X% over attributed X.XX%, the decrease service over XXX,XXX down quarter were with from days by make restaurants as days XX were portfolio plus key non-modified This points to the keep From year X.X%, rest to on XX delinquency portfolio strong in as fourth XX% Modified to points XX compared the at X.X% and of points delinquency and the but of were compared the asset of exceeding of was X.XX%. of of portfolio from September fourth representing X.X% September at approximately with XX SIC sectors and comprised total services, QX dollars and of the the basis fourth repayment X.XX% XXX XX frequency. to than at delinquent of receivables quarter are or net quarter QX. the dollars delinquent X.XX% plus were to portfolio X.X% to end less quarter, discuss the increased X.X% increased ending portfolio an the
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morning, and you, Thank good Lou everyone.
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fourth administrative commission primarily that due million of XXXX. increase XX.X was lower lower million million the with X.X quarter liability to benefits prior a quarter employee due to of was a associated expenses. to benefit to and expenses the due count X.X and were non-interest head expenses, and to decrease and quarter a quarter in our in salaries the to fourth Moving million and in compared XX.X was in third due million recorded reduction XX.X the incentive an general acquisition XXXX, The expenses in earn-out The to reduction fourth sequential increase compensation year-over-year quarter. the for expenses quarter primarily
have second and in our to meaningful As cost expenses. reduce of reorganize operating front These quarter expenses reduced mentioned, proactively office, administrative third head we previously initiatives lower reduction count, year yielding we actions are general implemented the and and cost now this savings. to
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portion additional hiring reinvested mentioned, we our digital cost platform. to a previously of savings employees As have support we our by origination
rate quarter income XX.X% to was with of the on quarter, fourth the compared XXXX. effective effective taxes, of tax tax Moving XX.X% our for the fourth rate for
full we the year Act income December enacted code tax in reinstated Act million prior provisions CARES from net resulting the carryback in to Jobs CARES a For of ended and that XXXX. tax Act March. existed the benefit X.X recorded the the XXXX, XX, Tax Cuts The operating loss
effective are XX.X%. we tax Comparatively years prior full year operating an Federal representing X.X tax result, recorded carry two was current we to where to net million back the rate expense XXXX, XX, a XX% tax of to rate the XXXX ended XX%. opposed as a losses the December for As our able
position, Directors shareholders well record our XXth they per of as payable confident share of losses as February We occur. future a to our strength as regular of balance Board potential sheet Our remain declared $X.XX ability and on withstand dividend Xth. the any to capital in quarterly very of of February should
the against We able our closely stabilize COVID-XX. organizational improve liquidity and I financial and originations evaluate portfolio carefully to the performance. am on basis, position of continuing quarter expenses, reduce and structure, cautiously performance our our in optimize operational potential conclusion, a In fourth continue requirements. monitor and will We pleased grow with capital meaningfully backdrop sequential and to challenging were our earnings, quarter
to value have in that management and building remarks from momentum the concludes open strategy, our we and That the year durability the and positioned resiliency to growth Operator. of call let's this to confident profitable drive that, the Our XXXX. emerge shareholders. We we for look well business place our team forward questions. with the solid on in are business and demonstrate pandemic finish for to model, up our and prepared
on forward speaking Thank again please call. look with Thank to and when in you We this us quarter stay your your joining you we and our for today's support time April. and and XXXX healthy. safe report again first late you for attention morning, for results
does This today's conference. you. conclude Thank
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