ENVA - Earnings call transcript Q3 2019 | Enova International, Inc.

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Operator

Good day, and welcome to the Enova International Third Quarter 2019 Earnings Conference Call and Webcast. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Lindsay Savarese, Investor Relations. Please go ahead.

Lindsay Savarese

Thank you, operator, and good afternoon, everyone. the the ended market for this XX, results after afternoon close. released third September quarter XXXX, Enova

If you the did earnings of press not website receive a you our obtain copy may it ir.enova.com. from at Investor section release, Relations of our

call This our With Officer. the Chief Executive Chief is Investor archived website. on being webcast Relations David Officer; me are Fisher, of Steve and on Cunningham, be section today’s call Financial and will

our today’s it, that on factors will make Before to environment today as certain projections I’d on such new forward-looking that from refer the like press and the discussion. Please statements cause I on result events. contain does a to uncertainties. based in we call David, and based release information information statements note these turn the our undertake forward-looking that obligation risk of to or are as materially over assumptions could to we described future call and to include differ discussion filings today’s update Any no the statements of business as we this SEC more our and results currently risks see on as specific for

included performance, measures our U.S. reconciliations we to the these between the believe GAAP Accepted GAAP found In in addition Accounting We tables press of release. not report these that non-GAAP certain reporting, conform financial do Principles. Generally in enhance are measures to non-GAAP understanding today's and measures

supplemental of website. the portion in our our financial have earnings information noted release, on posted As we IR

call the And David. to with that, turn like to I'd over

David Fisher

today. everyone. afternoon and call Lindsay, good for Thanks joining Thanks our

you our detail. the I'll a Cunningham, you who’ll I'm more to and I’ll discuss going call financial After that of by strategy. then our guidance CFO and overview in to third Steve on over start quarter our results turn the brief giving update

pleased We're bottom line quarter and of deliver top growth. another to strong,

Compared profitability. growth we last ability to results revenue year, to demonstrate with third effectively delivered our quarter XX% QX Our growth. manage year-over-year of

growth of in revenue quarter by businesses. primarily U.S. driven our Third $XXX million was

Third adjusted XX%. EBITDA and quarter increased XX% adjusted rose EPS

growth to lead earnings revenue growth profitability particularly fixed business our growth, ability short growth to our manage strong to customer While through new more rational, ability customers both and term, our a credit marketing to with leverage we in demonstrate and efficient for model. spend, online new muted from continue costs the our can stable

our increase with new which As by has been last in QX X% case buoyed acquisition, the couple years, only expense performance a customer year-over-year. marketing for achieve to able robust was the of financial we're

to up quarterly During new XX% of total the since quarter, loans originations, customers from XXXX seen we’ve and last of year. highest QX represented in XX% proportion the

the going these expand new As we've past, mentioned customers forward. revenue profitable time over in our potential and become

with are high with customers performance basis percentage QX the XXX with portfolio, good entire remains year. margins Even our credit gross seeing quality this strong of expectations. line in of points over line year, across well our year essentially This with last evidences new charge-offs credit the up in clearly as we're last and

we're in change to this years been we’ve is indications no not XX soon. While economic an and that likely signs for cycle deterioration any credit now, of upward seeing

year. company X% compared was XX% declined wide year-over-year QX AR while the but to sequentially, and sequentially, quarter Total XX% total last increased up XX% originations in of

given in regulatory the During there. quarter we dramatically the slowed U.K. headwinds the originations

originations of XX% U.K. increased a year. over total Excluding the QX healthier last

in cost credit. the offering the We're Financial by our we've access industry to started high today Authority, one announced first loans exit market. to intention short-term the to of XXXX, we the regulator in fast Conduct be U.K. also of U.K. helped millions Since get U.K. in hardworking our lenders We authorized the people trustworthy

our of team. we review [ph] Following business, customer that and due excellent the our an largest became service product, sector talented superior [lending] U.K. and to independent authorization

have challenging the the we experienced over a regulatory past and uncertain year-and-a-half environment However, in U.K.

and complaint policy in criteria to Ombudsman decisions. post FCA de FOS continued Financial in Despite our instances has the XXXX in fact reviewed goal approved the that inconsistent guidelines. move and handling setting changing the the business with affordability FCA fact ever many practices its And with that facto was

state conversations we've concerns our We've FOS past sought with around months, clarity the been regarding handling. in and from several over the future continued the of and complaints them FCA

efforts Enova path need our but and Despite we the right to result find in to for to unable our the a come U.K. one disappointing, a to our investing business. resolution, This decision we U.K. exit shareholders. market continue us that to clarity is best forward the are provides the is

discuss to put our more the we but U.K. they for ever our impact work up will growth want the achieving all long-term, environment to regulatory detail while a opportunities. to Enova, the say financial thanks in our special there. Steve will this be to pursue positive in resources continue in potential team new and hard continue adjusting to focused believe the changing I freeing serving customers a to strategy for

our our While is ongoing U.S. small not business. our about financing, U.S. installment near-prime in Brazil the we encouraged what U.K. business in hoped, our Decisions, remain Enova businesses, namely outcome U.S. Analytics-as-a-Service subprime business offering, and our the we loan business, our

businesses, U.S. Our profitability. products include and domestic growth business, large financing subprime business NetCredit and our drive to our which our lending continue small

receivables year-over-year XX% those credit XX% and revenue. installment of QX year-over-year in in for a was three businesses by a and XX% increase Revenue led revenue increase in-line up loan finance

$XXX increased XX% XX%. balances million and Net credit originations increased to year-over-year loan

of represented compared products QX of last QX, portfolio XX% XX% in of end our year. total the at to near-prime U.S. Our

the our and the underlying portfolio demand strong portfolio and which significantly business, our saw securitization. products high this base to This Net in recently credit was analytics. validation asset investor net fastest the of term remains second support growth oversubscribed, growing our and completed we transaction of credit demonstrate

a good small XX% business our as our Turning year-over-year calls, of are grow the as products to QX. small discussed seeing unit and attractive of book for end on small this XXX% at capitalized enabled us we We now successfully of business represents originations in business, we our economics. demand which to last opportunity few

As good We we'll our like credit products, stable in able our to the SMB portfolio. further be momentum expect at have quality we remains right feel and business in consumer growth economics. small with space generate attractive unit now

sequentially. In on declined quarter Brazil, basis constant a year-over-year originations X% third increased and currency XX%

banks As we've handle new discussed originations our while Brazil by reconfigure slowed to in intentionally practices implemented we we previously, there. the operations debiting

middle stable regulatory believe hopeful Brazil and the environment. opportunity to to position large continue population, we changes that are with well And a that on represents We large growing are that opportunity. capitalize making a we huge class us

a as Enova continues avenue a traction, our for service Lastly, business real unique decisions growth for Enova. provides time to gain analytics

Before regulatory I wrap provide a up, update. I brief want to

XX% California a between at interest caps personal roughly and aware, passed and probably that $X,XXX $XX,XXX. rates law you As loans

While we Californians, unfairly access on believe for we material our law not will this believe a business. and have impact to do unnecessarily that restricts credit

product, We three installment currently offer product, a a installment single-pay product. products a and in prime near California, subprime

from originating to plan underwriting banks which instead of loans, by single-pay continue and new to offer near we product impacted in services will originating prime California. national is law not and We a market the provide

believe lending we be given all in we much in subprime but demand of profit law, recapture and originations for California. gross proximately state. This installment new we'll to able only will wind volume QX, X% percentage not the product of from With the down need we in of accounted the a similar our the if installment product elimination to this strong the expect all subprime

Google's touch with Play to apps the briefly an over to offer that I'd also Store. remove recent XX% like on decision APR from loans

us. little have While it we on strongly the decision effect disagree with Google's should very

primarily opposed apps and designed a to of on growth that used QX sum achieve as devices our revenue bottom easy to customers products on to track overall In services. the was as result to quarter we Our and record access year. strong our so have operating great this site are are all and mobile web another line or and websites is a nearly desktop all systems, functionality use always

We have sustainable to diversification focus consistently well our growth. executed produce strategy profitable on growth positioned us our efforts have and and

about to momentum significant demand XXXX, environment the efficient growth to execution combined we translate and healthy credit record with leverage. our and and in forward the QX given seeing optimistic expect and are operating are strong of we profitability Looking track

you that, to be turn call I'll Steve, and on remarks Steve? answer With questions have. his financials your may any over the who’ll following more guidance that happy to details provide we'll and

Steven Cunningham

David, and good Thank afternoon, you, everyone.

I'll reviewing our our fourth year start XXXX. of the quarter for XXXX and and for the third operating guidance quarter full and provider financial then and the outlook performance by

line results our again pleased of or are As financial with quarter meeting performance top bottom report to expectations. David another and we exceeding either mentioned once

meaningful our Third continued revenue growth. receivables, and deliver quarter profit results demonstrate to ability

sheet solid quarters. to product Our breadth XX offerings, balance to investor meet have and consecutive of best-in-class been operational key our for execution, exceed guidance our or ability analytics

and associated his there. a with in of recording are As primarily of onetime write-off U.K. charge operations In we of million of business. to cash with $XX approximately onetime related remaining down fourth in operations net of exit, quarter million the conjunction intend is to we the tax and non-cash David the of which assets approximately million charges the comprised that wind $XX our the the mentioned charges exit market U.K. approximately anticipate remarks, the after $XX

In guidance unless business. the the the charges U.K. supplemental to for information excluding information Relations future remarks financial website selected but we includes Enova related on today, of quarterly results historical noted. our the operations In any my Investor any exclude our financial on the historical today, posted otherwise exit in operations results onetime U.K. provided U.K.

midpoint constant was company loan XX% by $XXX in finance at grew increase receivables which combined million On year-over-year. range Revenue basis, total to balances company third increased driven XX% a guidance currency XX% of million XXXX and growth $XXX our billion. $X.X million. year-over-year to a revenue the $XXX of revenue to quarter Total increased

sequentially total respectively. receivables than of the and the in balances, line in line and agreements credit products company products finance revenue Installment XX% our receivables, year-over-year loans, XX% third loans in total XX% credit in which quarter. and now grew to continue purchase loans revenue. million Installment comprise drive XX% our on of The domestic portfolio of $XXX total growth XX% to and of year-over-year XX% a basis more increased

accounted XX% revenue in combined for was domestic receivables operations finance year-over-year our of strong driven balances. total demand and domestic increase revenue Domestic by quarter. Revenue growth loan the and our in XX% in a

our resolution that As debiting market. David international future the reaching driven to the were our of by results on new continued operation in the business of adjustment practices focus on our and U.K. address for Brazilian mentioned our quarter third the

constant currency actions international result to and revenue quarter $XX constant a XX% or As XX% on XX% million. $XX these a million ago basis decreased of loans year XX% to the compared on international decreased basis or total a currency to

XX% total third Our quarter to in margin of quarter profit the third company gross XX% the compared to last for year. increased

credit finance combined loan year quarter. our average net as the Solid were the drivers quarter in prior gross main and of quality decreased XX.X% portfolio a charge from margin offs the to as of improvement percent third mix and receivables in XX.X%

losses quarter XX.X% end for as the trends. combined of compared solid expect loan in liability recent XX.X% the financing third receivables the of At gross the continuation a percentage company we of of third year, the was credit and consolidated quarter as allowance and last the for to

and strong stable growth predictable allowing Our economics. deliver customers to are with existing analytics attractive driving strong new credit and from unit both performance, us

XX% businesses and the we've operation As first quarter, XX% total year ago customers the of new and during year highest David mentioned, our since XX% all were a across proportion the of seen last from quarter. our originations quarterly up from of

expect For year continue the profit be our we to to the XX%. of range XX% gross margin full to in consolidated

mentioned upper the year. profit experience as the we've sequential lower half second during past, end of range we guidance of declines the of see the gross our we As growth the half during year seasonally in the in first typically by margin followed

As seasonally higher we our period. move growth into

credit new the by mix The versus and addition performance. originations portfolio. margin in financings our also of returning profit gross customers in In mix will influenced loans to in and the seasonality, of be

in in the Our gross XX% profit of seasonality from from quarter year. XX% margin this XX% the quarter domestic in sequentially second last year our third normal of and was the due third to lower quarter, up

year up XXXX U.K. margin was of quarter, up the international in third profit in gross as aforementioned from prior the reduced international the originations XX% second prior quarter Our the and and from the and the in quarters. Brazil XX% sequentially actions XX% year from in quarter

marketing of including $XX to During of quarter total operating or the XX% quarter expenses revenue compared XXXX, the $XXX of third XXXX. were of revenue in million third or XX% million

We quarter our $XX were of spend. XX% XX% the million Marketing in expenses or $XX marketing in continue or see third to million quarter revenue in revenue to the efficiency compared XXXX. of third of

expect typical will the in is our will year-over-year percent increase as and spend low-to-mid and As of in we sequentially marketing range in seasonality the we fourth terms absolute revenue. teens of quarter a

$XX technology expenses. in million million from related of the U.K. complaints as higher third or well the the with of XXXX quarter of quarter as to compared XX% expenses we’re totaled Operations revenue and in or revenue associated variable primarily XX% in third and ongoing expenses $XX volume

range technology X% cost for and expect between revenue. X% and We operations moderate XXXX of remainder in of to the

quarter or the and primarily from revenue legal third revenue costs of million General consulting expenses, fees. and personnel were the and related prior higher X% third to administrative quarter of expenses X% compared the or $XX of in year we’re million $XX in

We the in between cost flat of X% expect range to absolute remain revenue. remainder relatively G&A X% for of XXXX and

Adjusted to credit. stable and $XX in EBITDA non-GAAP strong third year-over-year XX% quarter by and driven the growth million rose measure

margin third EBITDA from adjusted year. increased the quarter prior XX% of in Our to the XX%

stock-based to expense the $X.X in million third XXXX. compares which was quarter million third compensation the in Our quarter, of $X.X

a was year quarter rate compared quarter tax certain the the quarter to federal The tax timing with elections. deductions in of associated effective third XX% the Our tax of included third income in XXXX. prior benefit

range. mid-XX% to expect our to be the continue normalized tax in effective rate We ongoing

$X.XX a $XX of earnings non-GAAP equity XX% Net third to prior income $XX the quarter and $X.XX from per the or million to income diluted million per shareholder third of or the XX% per quarter per using month million diluted XXXX. to third quarter share measure in third from $XX adjusted the return million in average or diluted ago. of The share diluted share XX% XX% or trailing net $X.XX Adjusted increased XX from $X.XX share on quarter earnings increased increased the year. during $XX year in

We liquidity flow a solid the continue cash quarter to generate operational position. enter and with strong

unrestricted $XX cash with $XXX quarter total ended the flows and quarter from cash the we of $XXX cash and million During totaled debt million and million. operations of equivalents

our loans $XXX corporate of under facilities and our outstanding Our million balance quarter end the $XX debt at of the combined installment includes outstanding million revolver. million $XXX securitization under million $XXX

net second announced As funds securitization our net markets enhances earlier further this to liquidity the capital and a funding originations demonstrates asset and month completed transaction, credit term to and $XXX back access our we we loan which our fund successfully million of our credit diversify sources. cost capacity ability

and fixed our investor to improved high X.XX% demand class a three significant investors. transactions cost of advance and of price rates, The are oversubscription weighted average levels was with allocated XX

the point approximately the income to XXX benefit recognize improvement cost Our from cost of basis the of continue pretax year third $X ago, decline transactions a completed The cost as quarter. over to past of funds same years. for funds X.X%, contributed the million two operating this quarter a declined we quarter of

million share under Today, a a we has that totaling XXnd, the also acquired December program at The million October program $X.X cost repurchase prior the XXX,XXX our Directors through announced XXXX. $XX authorized of authorization Year-to-date share repurchase that of shares of million. Board we program. expires previous new $XX XX, new replaces

us continuing will on to plan new for commitment to The creating for our share deliver shareholders. give our repurchase additional value flexibility

for revenue operations full U.K. one-time adjusted any our forward, and and year the the charges. fourth adjusted exclude EPS related in for Looking quarter outlook EBITDA XXXX our

customers domestic outlook business faster small recent of the in as line receivables growth growth and credit including mix and in of RPA continued an growth our consumer credit, stable addition, new relative expectation originations. In for continued products well installment, trends reflects as and of

year. expect EBITDA also share leverage and of to year-over-year the operating increase cost per in the funding We lower margins remainder earnings for

impacts significant from guidance to changes. Finally, regulatory our no our assumes businesses

total As a to $XXX earnings planned million of XXXX to $XXX earnings $X.XX million revenue related of the we operations quarter share $X.XX million adjusted EBITDA one-time for of $XX and result as fourth million, noted excluding of $XX and U.K. the adjusted in of exit, expect to our charges release per

loss to related includes XXXX, U.K. and share of quarter is diluted fourth to which be the negative GAAP $X.XX. per expected negative one-time charges the operations for exit $X.XX

exit. Our outlook related for the as the and one-time result full full year also the excludes U.K. planned charges operations of for year a

year operations. outlook the we share excluding total previous are the full revenue, comparability, EBITDA For adjusted for U.K. also and providing earnings adjusted XXXX per

versus total $X.XXX billion billion we of For guidance $X.XXX expect the billion. XXXX, full billion $X.XXX revenue previous of year to $X.XXX to

Adjusted $XXX $XXX $X.XX share And of guidance previous per versus million. to $X.XX EBITDA to share. of $XXX million of adjusted of million $X.XX $X.XX to guidance $XXX versus million to per previous earnings

diluted operations the charges exit be is full XXXX, per to GAAP and per to share. guidance which for earnings one-time U.K. previous expected $X.XX of share $X.XX year $X.XX versus includes $X.XX to the related

believe forward our to the meaningful we will diversified see XXXX, look growth we As as we product opportunities. offerings to greatest our resources we where allocate provide

expect financing trajectory in leverage of growth. EBITDA will top-line EPS scale our drive to growth flexible we into revenue our continue than year faster to We and continue growth and to analytics, and next

conference forward XXXX with outlook next updating details call during more early our on you We fourth to look for year. quarter our

with operator? that, questions, we'd happy And your be to take

Operator

Instructions]. [Operator

Rowan, please. Janney. Your first ahead comes question John Go from

John Rowan

the want guidance points how I I just understood sure take to of we the kind of U.K. out just and make understand some business.

figure. that XX it million I'm of odd to kind financial at So about right. of dollars earning roughly sound that looking assets, generate I'm some the way supplement reading the

Steven Cunningham

the you with the for without I historical information Enova or look John, mean, supplement, financial can at see the if U.K. selected think, I Yes, you

that is delta obviously So that... the

John Rowan

I what looking at. That’s was Yes.

of from international. income expense the is million the operating of of consolidated much lines? we is of that do there then statement $XX quarter in How And out Okay. that and much U.K. each for strip how

Steven Cunningham

Yes.

think the each technology U.K. technology line. operations The I you of G&A percent So I excluding with the the biggest gave range of operations, the you in and has for the the in change see biggest the changes lines, guidance marketing, - will revenue

John Rowan

to mid-teens to I Okay, if X% correctly had not I revenue. technology, sure make and X%, G&A was I’m then, said down and right written so – marketing X% And Correct? of you X% operation

Steven Cunningham

right. That's

John Rowan

just you to discuss you services providing going loans providing banks bit to discuss look can does are can continue how we're installment be underwriting And to from that little moving like? a on U.K., What you in that product California. going

David Fisher

Yes.

So banks who provide banks that marketing originate underwriting operate in will then loans. the and nationally originate the and for California

John Rowan

still we're of was But going With it that - XX% correct? talking California, be about to underwriting excess what you're that in providing. product in for

David Fisher

right XX% around of kind and above. Yes, XX%,

John Rowan

I’ll hop questions. if back any in the have further queue I

Operator

please. ahead question next Vincent Your Go Caintic, from comes Stephens.

Vincent Caintic

I broad questions. guess two

So first the exiting on U.K.

have like should be So now of five you buybacks? more six cylinder other actions to there cylinders Is we six going another cylinders. instead expect like or

David Fisher

both. I think likely

we we where But around because full ideas great the been is of floating our Enova we you, is see as market if Steve buyback always a plate Board gives great, the significant was up thought a with be proactive that stock. there to authorized which plenty increase flexibility $XX a going million, in out mentioned, opportunities camp So into or six businesses. to down our us purposely the in

to five or one do have an Now that those up more we're other provides I over potentially resources of years. that opportunity opportunities think and that explore to bubbled the down us

VincentCaintic

update can discussions we if partnerships one on just then about to and question appetite the on when hear so had of the maybe Thanks. could expect or on partnerships. more second wondering bank you've us And you the and maybe

David Fisher

great. sounds that mean I

contract working We signed have others. on one and

going think for good to going forward. we opportunity So be us it's a

Operator

Hecht, Your next ahead John from question Jefferies. please. comes Go

John Hecht

is And if it it that I sounds like John now heard Rowan name, Johnny right.

Steven Cunningham

But you're still John.

John Hecht

down guiding of in channels how - of the things work guidance, going attracting just that - terms this at of are this but competitive a Question know productively? the step year prior consistent is customers, customers highest Anyway, new last relative with certain lot while you percent, a are in couple you marketing taken Is you're down. so percentage is more to new markets? - Is a revenue. marketing I marketing being of a to has reflection level still yet

David Fisher

we've great more is, have won't still aggressively to efficient try We attractive ramp spend how marketing time we we and two over spend problem in becomes have up more spend, really we revenue years the unit Probably to seen percentage meaningfully continue as dollars forever, some lean not conservative be with a what less, more of economics. have. last still every ways but marketing into a and room is which to but

go of So spend once as want and types too silly be loans unprofitable to all much not maybe loans. spend we and don't the revenue, out or only it a but wrong and of potentially at attract percentage

continue So But cautiously. over more for as of to strong TV time we're this increase we to to direct and the has year online across opportunity that well. continues direct as our do a going do channel channels. spend to is mail continue been channels, well to there a us think variety

John Hecht

of portfolio it credit, but we pretty what different guidance, installment slight different the - then - migration. in that a I expected the portfolios respect saw that line of in the think seasoning with how markedly, trajectories with in and there of of improving kind underwriting function or a of credit the stable of credit do And results came standards Is of clearly those it's sort well your about total there? different was we more to line or

David Fisher

improve to leading -- strong level. it's mean the can't remember growth. very down little it certainly we XX% to number, the is, as something, growth the expect rate portfolio the XX% It's to comes good performance there. that for it. what's that expect just to were about time from really of that credit seasons, we And saw or up tick in leading fine that's increase high continue what credit exact I with We is line originations. but performance and completely it mean over I natural that's where I the credit the strong,

John Hecht

on makes implementation? last Steve, that head of CECL of be as we that question, anyway should commentary or we ton Okay toward any thinking that sense. about And the kind

Steven Cunningham

so effective toward requirements that progress accounting of X. making become of John, adoption January we're great Yes, new loss the our life loan

FASB guys that investment you fair that know think well And how flow no the on is both marginal cash has value as for allowing I CECL as options we this adoption given make decisions. compliance. impact as or

think compliance our implementation expect I I would the But P&L. that to best for should sheet we'll the say of the we that be you be adopting business. just for balance regardless captures impacts and an accounting policy economics expect both manageable

John Hecht

next assume I that we'll well, terms quarter in on good of…? so get then Okay guidance

Steven Cunningham

That’s correct.

Operator

Instructions] Your from JMP comes Scharf, next please. ahead Go [Operator David question Securities.

David Scharf

hey full I some speaking Brazil know year-to-date relates like raising you even unpack what like it If of Steve and I and down to David the seems A quarter mean guidance obviously there. there earnings this - look million I because as or I excluding I the want ignoring correctly it you're the internationally lot is to U.K. kind at earning when realize the U.K. and assets the $XX.X it and year in to exit. like. sure just make outlook roughly interpret loss the the the operating just was are drilling

remaining out that loss, unchanged from much to it of you way But seems that be that amount But effectively pulling annualize some Services the maybe by guidance million to year the last frame guidance there if Corporate went EBITDA operating its million, $XX a that know $XX core net is pulling Is the pretax pretty which out more your up. million, quarter? and is I of segment. $XX we’re coming the things for

Steven Cunningham

Yes, we I gave given that little oranges U.K. to do right, guidance apples think without mean and I going bit our the what just of to we be trying if were that's a was

bit of right. that pro you Just last forma to implied give quarter from guidance a

And basically close the the takeaways the but guidance actual for just just affirming third consistent as of quarter to remainder you So, year. the it the we have expected would is what as increasing, look had the of which maybe the overall. with very performance where I at we expected think slightly our of midpoints performance we're if well

David Scharf

it product. based like. you to dramatic And growth Yes, levels credit then much losses it was No obviously it’s installment the John you on the allowance question, Hecht’s make there and and line that’s credit just has different want echoing just switching in sure what near know which a profile know than gears seem seems maybe so prime. of such little

to thoughts just that’s I'm marketing choice. consumer to if any big the specifically just into is you the something this product type a will strategy, your it is and of I'm seems you be wondering, that of if of baked pretty and extent? for have what's It concentration on rebalancing wondering driving loan demand that type

David Fisher

mean we loan product the that products a installment ago think of things learned cases over a either customers years product. really most a even Yes, prefer subprime a or couple couple in line I is there pay credit I single

line for previously states of products look weren’t opportunities credit they getting available. where in specific And so, we continue rollout to authorize various some including products states to those

success us And a two, and past half so a for two great that's story been the years. over

In that a originations XXX% of number line business for of wide which credit two small over had year-over-year has of and also a as is small total company – well. is one and product had or line growth credit that's products our also

product also us successful So and year. for business very to small really has businesses been consumers like this small appreciate the seem

David Scharf

that's like I And sense what don't I is. for the it's period guess just the balances can something time how whether we how end versus has borrowers give much in it's aggregate actually pretty on curious open and mean I us have approved point each quarter? just been see been know of with for what a those you drawn you a much like in borrow figure your September at stable any to disclose. lines XXth But

David Fisher

upfront corporate for. or It's pretty less some to more I a card tend something disclose track. we draws a not, take very the like stable time. it's more revolver. We that’s than not they're draw over more a additional would maybe making that exactly, – a like really like repayments Customers is don't or then credit take actually it's really of that start And line. It and stable but authorized it's like usually it's amount total the

line like people So low very like utilization we unlike facility But corporate there like to it's see up then also tend you very stay a line to just of to XXX% get where to we credit not forever. would don't and subprime tend tend utilization. see credit have where low card our a credit of

draw to those tends with the really the between initial large in that. proportion of being be two So

David Scharf

more California. Just counterintuitive on question different maybe last the twist regarding a strategically questions

all given online the lending anything you've risk adjusted attractive? much pretty this there or that in market as and analytical your appealing to longer anyone the sub is XX% returns just capabilities competition to Just and may than not start look been you of

David Fisher

a there. sub I say capital two sub it's lot advantage terms no, there's of of XX would big a the of no. XX have Yes Banks too a and things, for cost in and down market of competition clear us lending one direct in not

be. So not where it's want we to

in well analytics really do work there, our have space. analytics, we terms good are we In near of think subprime advantage nowhere the but I and the

harder. a So where we prime near have a near and space subprime customers prime Underwriting deep is experience. much deep,

customers advantage in underwriting easier. where better much analytics a prime And than – is our so, provide frankly capabilities – much bigger

David Scharf

I keeping you I rising it you're increasing that the pretty not rate. the percentage you in XXXX know and been guidance – No, – – But has revenue. one same marketing not mean more despite of spend called know sneak yet. times Hey, acquisition level or mid-teens if how no out of I low level few to a sense. customer new at makes keeping

Steve out that's guidance, know incremental for goal of trying a mean get is is target I of – and where a most is one to I model. something leverage operating areas? looking marketing your something that's the whether you specifically that sort that I'm those a as the operating sense but surfaces in year,

Steven Cunningham

of solidly into that not into that operating G&A really marketing No range. and arise fixed level really that marketing, and leverage and from The the pieces are marketing. is getting focused we going operations of technology to range on

David Scharf

Well Great, I my assume guys. I'll so on commercial credit I first seeing more. be yesterday, net thanks saw television

Operator

for back This conference turn you. would concludes to our David Thank I Fisher, remarks. like closing the question-and-answer CEO to session.

David Fisher

Thanks call our everybody for today. joining

very with much forward and quarter. look it appreciate next to speaking We’re you again

Operator

The you. now Thank Thank conference presentation. is you attending for today's concluded.

disconnect. now may You

Enova International (ENVA) 24 Oct 192019 Q3 Earnings call transcript