PRG - Earnings call 4 2023 | PROG Holdings, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the PROG Holdings Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, John Baugh, Vice President, Investor Relations. Please go ahead.

John Baugh

Thank you, and good morning, everyone. Holdings XXXX PROG Call. the to Fourth Earnings Quarter Welcome

PROG are and Garner, Joining Officer. morning Michaels, our Holdings' Financial Brian me this and Steven President Officer; Chief Chief Executive

earnings seen on available Investor Relations copy already which our have investor.progholdings.com. you this morning, of of Many our release website, issued is a

the capital make our certain of and priorities, outlook items place including undue expectations for today, quarterly no expectations allocation first are and and be in quarter our comments portfolio; and to and future outlook in options regarding cautioned consumer undertake to this call, a update regarding future will not year other our During purchase XXXX; our GMV regarding the any repurchase for periods; demand and of we health XXXX; XXXX. operations; our of regarding statements our we statements ability paying make our forward-looking, XXXX we Listeners full in such including to expectations shares statements. the leasable levels our performance charge-offs continue emphasis dividend cash XX-day the of forward-looking on obligation our

company's results performance. these measures to with these in have items, reconciliation adjusted of operating On will operational financial to adjusted financial including cash that to EPS, company provide the insight with facilitate with provides be release. other earnings performance understanding EBITDA them believes performance in our which measures certain been and help which periods detailed comparisons and investors company's measures tables non-GAAP certain today's measures, non-GAAP and the for assist are may affect non-GAAP comparability into meaningful The ongoing non-GAAP referring flows we call, the our prior These companies. and included to of the operational

would Chief President to Steven that, PROG Officer. over With to Executive call turn and Michaels, the like Steve? I Holdings'

Steven Michaels

year outlook and the a cover some we our report matched XXXX we as return our of in John, Today, unfolded, and XXXX to appreciate you initiate us initiatives as the joining outlook quarter I activities. dividend you, fourth our will business our or Thank exceeded are how concluded, everyone. full we provided results October. QX to good morning, late how capital we for drive a forward complement and decision implementing XXXX, to strategic that

partners. another was share these our of year weaker-than-expected for management Last business. shift spend year through balancing traffic in to our experiences and GMV strong consumer our while The categories operational gaining headwinds pressures and retail partners, We top retail with retail both spending from and balance customers challenging in discipline. impacted navigated leasable execution a portfolio consumables of and continued combination and

XXXX, Despite payment in year a gross strong margin revenues full decline our to behavior. due customer for primarily expanded, the

along our executing purchase benefited The our consumer XXXX, drove macroeconomic monitoring decisioning our at payments portfolio level from team's reminder, choosing half year. a a their made the strong first also for in our benefited I portfolio option backdrop. of portfolio throughout management want XX-day and in thank a exercise careful volatile fewer from to As customers XXXX. and with and which teams to mid-XXXX, charge-offs changes throughout the high lower-than-expected of customer the through

growth write-offs margin a resulting spending to of XXXX, to XX.X%, year-over-year or in approach $XX.X expansion XXX for points drove margin XXXX. basis of improved of and in disciplined XX.X% Gross EBITDA a X.X% X.X% million compared adjusted

due a program. of diluted we share $X.XX Our share benefited also repurchase count our as to lower non-GAAP year-over-year XX.X% EPS grew from

X.X% anticipated with expectations to a October pressures The our year-over-year. materially to Turning October, GMV ending continued of We when a similar GMV, delivered performance. progressive decline our XXXX late QX down set we into and X.X% mid-single-digit GMV QX. QX in leasing increase in the above month

including retail performed The partners, this believe our approval a more in various initiatives outperformance of increased to solutions sales higher for in than holiday and consumer demand driven we trade-down effects implementation was resulting observed with factors, stack. marketing above of signs season, positive the by some of and tightening payment better point-of-sale comp holiday mix during credit conversion and the electronics GMV slightly Notably, however, the We quarter. increased a season. expected, rates, due effective for consumer in us strong and smartphones spend,

seasonal partners leasing we GMV during In and representing as leasing percentage new integrations a of our e-com to quarter through and QX, e-commerce retail the a XX% plug-ins. customizable approximately high, was progressive GMV, of at continue total add

most We with able deepened X which with launching our them. we many a as whenever we convenient retail partner. solution allows added partners twice XXXX, and is card nearly XXXX, further e-com being to an integrations In e-com top for including also several in of added wherever partners, to new customers with as our existing our strategy us long-time engage

health good portfolio of structure. our the we XXXX, about our Entering feel and cost

continue emphasizes to partnerships, pillar, Enhance and dedication to our existing I'd to focus like business against highlight strategy areas Grow, marketing. which our To Grow progress efforts and We development our multiyear support retail across Expand. sales make a to new few and across

grew our exclusive we the key retailers continued contracts. Within environment partners record channel of retail renewing top track of share balance and our of multiyear with XXXX, with

value applications and a all in across incremental creates existing time. drive through development business partners conversion. the all for and team existing customer that team and sales is categories as initiatives improved mindset Our and The new traffic prospective top-of-funnel

important growth market. $XX industry's component pursuit of our capture $XX to regional new and of more to billion Our opportunities addressable our billion is across retail strategy brands national of an

customer brand Grow strategies to to marketing cycle. through marketing focus the the pillar, growth. our channels continue on life direct-to-consumer a invest scale top-of-the-funnel we awareness under catalyst in a We enhance Additionally, as and

partners We also strategic acquisition to business. retail to campaigns new customer repeat work and marketing support increase closely with attract

relationships, and Our ratio. helps high us of builds keep nurture repeat customer value with acquisition lifetime maintains customer that base, a engaging which healthy to cost we content

refer other Marketplace the we customers We our channel for double to marketplace to already which more launch. view retailers downloaded repeat GMV PROG new they roughly and marketplace, continued than as affiliate our materially through which We in where X partner partner retailers in allow grew Marketplace, million direct-to-consumer to as also we which been this relationships PROG retail of gives we And to since XXXX. Our PROG plan the since the when country. more this through a enhancements has its the times shop customers XXXX. with mobile complement year, some our Marketplace in and want we choice. through have our efforts, with app, leading But best

Enhance make our more journey customers. are retail to technology we pillar, quicker our leveraging and Under and partners the seamless for

portion while retailer shopping superior and Our recent more technology a and self-service the tools retail best decisioning our our is helping features flexible XXXX greater to enable road make informed technology partners. to to experience. map support in customer the of a investment customers investments provide new for choices customer-centric, our streamlined Also, and dedicated most a our for experience, and continuing personalization lease offer platform

generative investment several last launch our a consumer the customer Labs prevention, reducing our Enhance and group since productivity improve R&D group code Labs, and merchant of in has gains year needs piloted company pillar, represent achieve fraud experience the Additionally, solutions cleanup. to support, strategic to retailer AI. we to marketing through our the customer value-creating within the launched PROG efforts short improving These responsiveness while PROG costs. In and within the and relatively period under

of journey. more financial our XXXX, In account help the Expand launched savings. to customers installment an successfully a through continues to their product, the and empower both and Under positive history benefits pillar, secured of customers ecosystem our build loan Build our credit combines multiproduct we personal savings which

building be and leverage to necessary a our Vive, credit pay we as pivotal later to now, Leasing year our infrastructure Four, ecosystem. further Build, offering; product into solution; XXXX Progressive expect integrate our our buy secondary credit We

also through will marketing, our GMV. lean We leasing incremental believe will cross-selling we motion, into drive and

operations, in will In the terms will that our we of and our cross-marketing include for it of size a and the Four GMV top business. efforts, anticipate XXXX, through customer which retailer XX leasing acquisition other these represent drive Build,

Lastly, our we've the progress other operations. made of on profitability good

X/X earnings as approximately exit and We will profitability we our operations other these expect XXXX, reach to we XXXX believe reduce year. the by drag the from to compared on

get the macro into about on we're our going the While backdrop more Brian detail outlook, will XXXX thinking how summarize I'd year. to into like

due continued XXXX. believe Similar continue to we are headwinds XXXX, our to in will leasable economic our for facing, pressures customers demand in categories the

retailers in the Despite with started as progresses, by holiday year could a outlined will the retail average categories, GMV holidays drive promotional initiatives strategy Grow, With strong ticket leasable partners. in the to these However, pressures. activity further Enhance off optimistic in in many XXXX season, offset XXXX our since Expand of result an in our an softening uptick traffic major we decline across a pressures in size. attempt that trends are

QX is of based season GMV XX-day has a the also amount have have. level influenced to impact in. in to season, purchase our the heavily refunds but activity, refund affecting Tax yet and a by impacts can our tax different kick liquidity the really margin on several ways have impact which business can due of customers

activity when season first know late we should complete. be it, release the will impact of will the the not tax of this happen As full of we most until large refund tax will the but March, week, understand refunds how unfold

progressive macro of been and was to leasing within And January the have headwinds the expect month range. similar uncertainty the quarter Our low down digits. GMV we a for I given single discussing, end

the with initiatives direction, Even enter health optimistic year, about and the unknowns as are portfolio. strategic our of headwinds we we these and our growth

a of historically which, XX-day as the predominantly XX-day behavior option this gross Goldilocks half, fewer the from in choosing XXXX. to half last, scenario not of lower charge-offs first based expecting the and in have terms the repeat exited and first exercise half on benefited XXXX of between In their are difficult the purchase we of year comparison customers a XXXX low we year. purchases to from first XXXX, in margin, we

resources strategy focused and X on Our remains these pillars. initiatives Expand, numerous across Enhance solid with XXXX Grow, across in

the million, free business allocation. on priorities capital of the and remain business, our cash This initiation designed unchanged, followed number intend share a to is of a pay shareholders. first Board PROG our to share cash returning our forward, to declared complement quarterly repurchase per to to share program, program subject company's capital $XXX and our going cash conditions by repurchase in Directors. and excess $X.XX returning of the excess dividend allocation M&A to reinvesting basis increased strong factors, capital We quarterly Holdings' and generation to Turning model's the to under ongoing capital availability shareholders. commitment of dividend Board Directors our reflecting flow of total quarter XXXX a for of dividend market by including a prioritizing a approval and

In XXXX beyond. summary, our XXXX initiatives performance lay foundation in ongoing strategic and a and for solid our

ahead our are remain We delivering and to partners retail opportunities customers, and dedicated value the to shareholders. excited about

Before of and Board this, his Co-Founder Officer I Leasing XXth be to over want announce year as in executive turn call Brian, to I Holdings, member and of of that Progressive service. a team Curt Innovation Doman, Chief retiring the member PROG will the of

his to has industry retiring is be that on will overemphasize It executive position, our virtual transition the Curt impossible Board a member as from our to and continue adviser company. a on and he impact of lease-to-own role While senior Directors. both of the will had Curt will

virtual created Brent call the XX Progressive with and industry the lease-to-own we founding years ago, Wilson, now Curt of partner, Leasing. his

financial driving tomorrow For behind creating helped decades, in unlocking X.X better career. I for exemplary while for on the PROG that millions thank a built has through the want accomplished he personally grit he today behalf the and empowerment. has congratulate of entire of has of all what a PROG and innovation for leader, customers force him market the the has possibilities been Curt to Curt and last family remain his

its Curt brainchild. Curt. recently We will efforts, in but Curt's PROG PROG's be Thanks, will Center, us. the focus strategy, to philanthropic advise remain will launched are driving was also Foundation Youth fortunate continue which primary Development He specifically involved his that and and counsel

detail. now will to our discuss XXXX greater I'll over turn in Garner, call our CFO, financial the results Brian and who outlook Brian? XXXX

Brian Garner

start Steve. of a QX Thanks, financial with the summary I'll highlights.

our virtual for Our improved financial as lease-to-own results, GMV our quarter outlook, matched strong within ability showing control. exceeded product demonstrate demand our to marketing to and continue our results fourth initiatives manage drivers sales or

Beginning decline. year, a Steve on for segment, QX with mid-single-digit Leasing our X.X% compared to as of call Progressive Leasing the improved materially of our Progressive QX GMV mentioned, expectations above last communicated

the during holiday strong In benefit our to consumer pursue season, direct-to-consumer results. addition which TIM spend to rate opportunities, overall of the marketing contributed the of demand increased and

more business, QX year of portfolio XXXX will tailwind meaningfully the late revenue. in a to contribute to this revenue GMV XXXX compared as As

the segment million gross Revenues with time lease $XXX.X X% We for XXXX quarter last asset from a fourth down year million. X.X% declined the Progressive same improvement exited down largely the and exceeded to balance Leasing our to benefited Revenue entered top QX GMV. to as behavior, for due a $XXX.X X.X% outlook, compared payment portfolio in the the our the as our of GMV quarter fourth the better-than-expected slight benefit from size. favorable end with along customer

Year-over-year, normalized basis by remain levels as improved year-over-year the while XX.X%. in revenue driven favorable from XX points higher yield purchases at we portfolio margin trends, saw to charge-off quarter gross XX-day

our merchandise payment X% X%, of resulted lease write-offs behavior Our targeted portfolio range X%. a management for of the of customer to strong midpoint provision and annual the of to in lease led

percentage expense SG&A year-over-year QX in XX% QX a of Leasing's XXXX to of revenue from increased of as Progressive XX.X% in XXXX.

quarter, increased primarily fourth $X QX. incident occurred the million the cyber SG&A year-over-year, in that due expense approximately with incremental costs spend onetime For and associated marketing to

in our further percentage we I we XXXX. the actions trajectory a for put took us in flat SG&A on expect have outlook, a in January As discuss as will revenue of restructuring

for margin range revenue QX million adjusted performance, headwinds targeted to and year as annual within $XX.X period portfolio of EBITDA our to the XX.X% in million from XX% declined Adjusted $XX.X SG&A to offset XX%. in partially resulting by same were compared spend EBITDA Leasing an of last to Progressive

Pivoting to consolidated results.

EPS the declined $XXX.X Leasing share $XX.X million QX ago $XX $X.XX, revenues in by to the the driven our end outlook lower adjusted at $XXX.X due revenue in million from top margin. segment. by period, in contraction at the X.X% resulted of to Our non-GAAP year the declined our in from share favorability partially Consolidated offset by came EBITDA Progressive Leasing that in part the program. exceeding XX% decline the million Progressive count from Consolidated million but at gross to driven repurchase segment,

Our midpoint outlook. adjusted the EBITDA performance at our of was

increased quarterly press company's announced the earnings share the As morning's $XXX Board in to approved authorization has program and the dividend $X.XX share per existing a company's cash of release, this remaining million. total a of repurchase under

is $XXX which repurchased of flow million shareholders working $XX.XX. through price X.X To our echo stock Steve, fund shares of these our to in of of cash XXXX decisions allows We a value to at operations, capital profitability common repurchases. us weighted average cash speak of generation to of share return the the The strong and which to million needed business, combination company from dividends and net GMV. a generated

end. sheet. to at in our remain balance debt million Moving our XX-month We $XXX million adjusted the with million revolver $XXX.X $XXX of is net the EBITDA. undrawn comprised debt, million X.XXx We of quarter of and cash quarter which on gross $XXX.X ended trailing

key aspects in some press earnings our release. this morning's was touch provided of which I'll on now XXXX outlook,

at continue half first down GMV quarter decline with percentage least headwinds GMV XXXX, a first We the of to of year-over-year our single low through expect digits.

pressures, first a these GMV lease balance enter consolidated result gross expect revenue as with asset being will We down down X.X% we year-over-year. half in XXXX, combined

strong, throughout portfolio performance to to actively remain and Our expected yields continue XXXX. we manage is will

throughout Progressive the we exercising lesion be the customers rates in a we purchase last coupled lower XXXX low a XX-day of saw year. percentage record of to with first segment However, compare to the for half year, gross margin option difficult expect as charge-off their

we and of roughly growth XXXX, a anticipate to across Progressive X% revenue year merchandise will cost the to targeted year-over-year independent provision drive flat last the allow for to deliver for yet investments roughly actions million intended efficiencies X%. other month, cost a still sales within of certain including the structure by should announced Leasing, and slight savings in to a initiatives consistent these partially remain SG&A that we cost $XX range another our are operations. increase agreements leases in In reduction but expect annual actions of leasing performance The segment's drive progressive offset percentage lease the as and of We of Leasing in year-over-year. within business office-based consolidation for termination write-offs, workforce, agent Progressive

the Turning to XXXX. for consolidated outlook

environment $X.XX be $X.XX This increases the a for material EPS to no to XX%, of rate operating to outlook adjusted EBITDA difficult revenues non-GAAP share tax consumer EPS demand range durable additional expect of We the posture soft in range impact repurchases. continued billion consumer $XXX billion, $X.XX of approximately unemployment the million in range material $X. the decisioning and assumes the million to from effective for non-GAAP no with $XXX for in in of our no goods, changes rate and and company's in

to company's a the closing, several want increase and wins disciplined with renewal team to operate with strong emphasize balance through XXXX, top the portfolio of macro agreements In level high environment of an retail SG&A the multiyear spending. at ability I during partners, thank challenging share a in performance including partners, for key several exclusive and

In will controlled initiatives, portfolio maximize continue and focus value. the with spending XXXX, performance we on to balanced to shareholder growth

to now operator turn call. back call of Q&A Operator? I for portion the the will the over

Operator

from [Operator Joseph comes Jefferies. with first Our Kyle question Instructions]

Kyle Joseph

getting guidance your on congrats underlying year. Brian, perspective of consumer I'd the in through. love of start run of navigating and Steve challenging on a to kind your just the health kind

but little about provision. EBO talked You bit a activity, also a normalization higher of

the get driving the relatively weighing want what's environment, on reversing? a consumer? a Is but employment that? really going that just of of just of what's Goldilocks -- kind with scenario sense kind Obviously, to function your healthy but the a inflation, that Is function of

Steven Michaels

far right? past, you obviously, of time improving. on super a some hit a lower it, stressful XXXX for in about So buyouts our too then 'XX without was inflation. during talked going Yes, season. even the the got you And Goldilocks, was and with stable certainly consumer Kyle. lot tax could you So you And XX-day happened maybe right? And say we've mentioned it, that

buyouts, And those XX-day probably rolling ones a more to not those importantly, did and through happen, like pay those as, if continuing charge-off. to not that customers not

payments, that in do resulted have to might able XX-day, or not XX-day some to not choose the and continue had making do to the be stress to were they to they their able that but So them the Goldilocks. cause

Now normalized. an where we XX-day into half into us of that's season XXXX. the low for exiting days that's you The our right baked are were as but it's that activity consumer tax repeat. And because back levels assume ton been We hasn't to XXXX, now XX outsized good. strong. impact of certainly visibility kicked or employment, good a is don't that really cost of on that some going what's really has to certainly, really to jobs you the historically flip consumer, but And shape as There's difficult have Goldilocks inflation in yet, our is said, in view. are

waiting not to drop. for shoe we're So the

-- But weeks plays from we're that next as consumer visibility happened not or repeat 'XX, standpoint. the tax will XXXX. of over that expecting Goldilocks good more the complete in a out. most health not assuming first just a the shape just X We're more X season for it We're pronounced but in have that half We'll of of 'XX, into repeat. certainly the

Kyle Joseph

Yes, sense. just one it. for And me. that Got follow-up makes then

little saw But just on brain of you a quarter to for -- bit perspective. effect. pick your I that a your result tailwind mentioned want you a GMV trade-down as in the think fourth of I

environment like with us a space few prime the week. about seems about a are trade news big rates. sense, and just give talking now some kind finance your changes and And retailers? macro the seeing like you conversations consumer ago fourth obviously of expectations into talking quarter a incremental soft But the then this down potentially landing in higher it were weeks Obviously, we're we from

Steven Michaels

evidence we benefited many we've a has of season of the was Yes. mean quarters, trade holiday impact, factors, Kyle. about anticipating, talked more it that certainly we've benefited and quarter believe I delayed. which number a the for Thanks, as Yes. down of been which, from fourth and been one

a tighten from But have payment retailers for was way the on did hear from did need to LTO partners. And they to primaries finance we told in consumers' That the to holidays. just bright generally tightened -- option during a again future. heard also talking that directly the We we've was LTO. that ticket wasn't the And demonstrates that are and big and primary the spot items. our which have them their all retail that planning --

a of providers. by about it, though, think that consumers, we option, them more is will about The more over way be time traffic, Off traffic it's purchase traffic, The believe, need their we that generated. and the really option primary is will right? less purchase approved

share So continue that's otherwise of that of gain we belief the our the to partners retail environment. one can our within of challenging drivers demand balance and offset

The not impact, you funded tailwind, the the be And relationship linear is it's if dynamics, it magnitude of GMV, even XXXX headwind. will a top-of-funnel you into will, see of certainly but or we tailwind to and removal it's beyond. predict difficult a direct if hope trade-down a the because to

Operator

Haas Our comes Jason from America. of Bank next question with

Jason Haas

on you in to write-offs what could provide little in more color if bit XQ. regards curious saw a I'm you

through I XQ. up. a XQ then And we curious this to XXXX. following that, think historically, about you're But you've the down cadence seen I'm write-offs quarter, of saw from on how write-offs about will just thinking step tick

Brian Garner

very there, our any was some X%, are XXXX. into place degradating in we're All the there way we historical that no healthy indications of right in Kyle, Yes, inclination beyond enter our there in -- where portfolio middle the seasonal a as range we're dynamics beyond but comfortable. of are and was

was do an of here that of Goldilocks at basis reversion normalized what as the macro we've below to which we X% scenario annualized to a posted the look X%. from a and kind sized uptick to the we alluded midpoint on Steve slight in we XXXX, current up scenario, XXXX, from As what maybe expect more just

P&L standpoint that very So remains a deliver we of in focused confident to range forefront management think margins, gross from but XXXX. the what on within for feel optimizing at and I we're ability portfolio our

Jason Haas

And just or quarter to changes? at lose you was in any no? credit the clarify, all Did there decisioning some

Steven Michaels

Steve. in Approval changes in adjusting higher. were and Jason, always the rates quarter. slightly done online year, the decisioning, this the We're channel, the is more in quarter testing wholesale channel but on in-store and a in average, slightly the weighted on tweaking no the higher than previous so but than were

as intent dynamics. you obviously, And know, There's online. the versus those different more channels conversion store have different in you're purchase if

in increase portfolio an a bigger through into that So rates would on change change really or a or a our approved flows But impact write-offs. noticeable to store GMV. believe certainly have performance we in nothing

Jason Haas

in it. you've you categories category, some regions. if any how e-commerce a on seen the more in helpful. versus provide Got noticeably curious that were also I then there curious could by on as January And in follow-up, or then in-store? January, I'm was certain color winter weakness That's weaker compared weather bad I in are know And if there's January? that stronger some that

Steven Michaels

I you the you weren't word fairly very but to well told Yes. on seal broke allowed the the And pretty January us. been closely, I -- follow team has weather we documented mean, soft. for I say the how call, know

country the events in-store than weather out that online. on impact more across certainly had there So some

in X said of the kind marked wasn't we between different a single There channels. season, the holiday of out we did the a remarks, difference down coming prepared as January, digits. low low But see in

to As season, continue categories consumer the far actually electronics was we as to go, we see better. similar performing -- holiday

of than decent were softer planning overall, stores But was the or some days some promotionally-driven And weekends. furniture decent we had some it for. -- decent

Jason Haas

during early to too the Was there pickup or weekend Day any just say? Presidents'

Steven Michaels

impact too on. for data early the purchase leases and were well it's with sales Yes, were still have campaigns things and has not, that come partnered they that with on of -- as tax whether in will deliveries our it delayed activity or The season during the delay retailers some nature. President's an and say. to written, you And putting they in We their funded -- Day.

So really really tax to in not and through see it's to the we February start put till what's a happen. going comes how pin difficult March, end through of to until season

Operator

comes question Capital Bradley Thomas Markets. next KeyBanc with from Our

Bradley Thomas

trending? in I I the little remarks, I was the that's in I this you're and was how apologize about of a think if in a year customers count missed a talk there customer it step hoping bit starting to was prepared the bit press of about you where lap point I Steve, but don't a a believe release. been number could down ago.

all trending how So that's about about and forward? thinking curious going just you how are that

Steven Michaels

Yes, Brad, those to those I you of call. get me. We in front after can don't have numbers in -- right after the

shortly a as we'll think the But we K I repeat obviously, here well. file have lot of business.

we our mature about other helping to our And our we to of we that's the the from more to customers become, discussion -- those existing the all -- new introduce higher business. have, will had leasing We the and retailers products a multiproduct repeat have, that that including have are we products, always the relationships ecosystem some looking to add to we ecosystem. of new customers that

working influx add new of try in hard we'll in we're obviously, customers retailers But have and front new So very get to me. those don't the and as a numbers, that of then year-over-year I far customer regard. right as

Brian Garner

hear me? you guys still Can

Steven Michaels

you. got we Yes,

Brian Garner

around was you'll I the right so got in -- with going it's Maka. decline but see There's to I've say Yes, GLA, consistent down slightly, just X%. a --

so and from not customer there's it's count a disconnect consistent. pretty So GLA,

Bradley Thomas

really, partners. that we're dynamics from balance seeing lease some it to deflation And like it. was appreciate kind going out and of average tie to the I of just dynamics around I my question follow-up your with retail

Broadly, as et been have cetera, lower deflation, lot furniture, have of goods, container a rates the flowed through. seeing hard particularly

been average that going And curious you're customers the which it's was that the how how then of they're usable capacity reducing lease I forward? kind thinking seeing if your So with for balance taking up if about to it? or are business dynamic approved you're have affect they you

Steven Michaels

if we it. to remember talked in about happen didn't Yes. anyways, size basket was really it reduction February's a on but It fairly size bit that was -- call, ticket I we last see don't little We actually we expected in And average 'XX. XXXX. in or -- flat that

that But out, average activity we into pressure whether ticket, to there's seeing. amount small clear on be could be a deflation -- some for or there XXXX. our inventory and that And forecast of is it are promotional baked

Bradley Thomas

Well, Obviously, in program, one could repurchase if one. last share Understood. new you. sizable. Got I quite squeeze the

you potential the get if to -- curious course this or capacity could year. after Just of ratios that us give around leverage program any context over

Steven Michaels

Yes. I authorization up topped the did I $XXX the we it -- up million. call mean will to Board repurchase

As acquirers we'll several continue of returning the you last capital preferred shareholders. our stock over know, at pretty for to method to we've of and been that look our aggressive years,

However, we dividend The well. that. approved as initiated a Board did

that we activities. those And look -- so that at to a as nice complement

relates comfortable look an leverage that X it's because it -- at basis, to to similar that necessarily basis of on X.X will We're And a what in to not that we fluctuate. range. quarter-to-quarter ratios, leverage said. going kind we As have annual of to on net turns that's

we that cash but primary cash flow. we And repurchases, vehicle has that a return well. that define and excess accomplish we a XXXX, current generate with to from is have shareholders scenarios for cash additional much -- continue forecast all will we'll our pretty standpoint. to certainly, leverage to us, now for generating dividend we our being And the in But look to growth as ratio can as return flow, us comfortable

Operator

Chukumba Anthony Loop from comes Markets. question with next Capital Our

Anthony Chukumba

an partner I my you're perspective, from of retail is also what in terms seeing in perspective. enterprise pipeline, from first but an guess question SMB both the

Steven Michaels

big pipeline of focus vertical SMB is that's depending a -- to ours. on mean, a levels And which or in. as more area category competitive times, there. Yes, be various It side, the call Anthony, a players obviously, about on of continues with the of out I'll I we've you're it, maturation. number more talked There's

long as always the to job any side a but grow priority regional supportive in we really for space, sales pipeline. not not to certainly ours. existing lead top a conversions. through cycle as clearly to this remains backdrop side you do names continue well and frustratingly this environment updates to and enterprise conversations is we growing challenging But for of business we'll believe or look here morning, the continued those SMB partnerships a that And converting new The national is any a great and

Anthony Chukumba

expected Got What helpful. think low mentioned it. And to be down think you is first you quarter. and to think you quarter. positive then to a much has GMV GMV do so growth the quite you nice for this the as possibly in than mean for single have GMV you I did That's about digits GMV, time first you happen inflect fourth some going GMV, in that certainly better year?

GMV us the in happen to or quarters So do XXXX? has the -- quarters positive say, X think last see you to any of the for what X of for let's growth, last

Steven Michaels

on Yes, with retail Anthony, I existing mean, going we of have things lot a our internally partners.

one increased things of It's can retail those resulted it soft have in I -- we a things enterprise conversion, otherwise highlighted types card resulted difficult from the of the things existing number projects current And has top overcome of on think an retailers. while of the we in hasn't integration those help -- and we that environment us pipeline an prioritization a long-time has large of those environment. a map many demand done road partner. with e-comm

face pipeline kind as can singles GMV doubles we're the night day and can soft that we and including of of conversions, ball our And large hit motions that prepared manufacture a objectives, And hopefully, tough really environment. from inflect motion place our and and direct-to-consumer Marketplace, or overcome internal marketing working while the environment. I in so small cross-sell on in that our products, our remarks as mentioned PROG well other

things the guys in things, we working continuing are those mentioned and look that those on So certainly to that. we're on. expect progresses the to report progress forward you the out to we on And year as -- the

Operator

Bobby Raymond with Our next question comes Griffin James. from

Alessandra Jimenez

is Maybe first, on just for the XXXX sales missed guidance Griffin. is My follow-up in the GMV apologies full full for what year year a This outlook? it GMV. But I if on Alessandra prepared remarks. Bobby apply the Jimenez

Steven Michaels

year. Yes. GMV We the the guide for actually don't

of those will into So composition that. types and And revenue, you although in big has obviously, can models. everybody factor a revenue disposition back have their kind

what -- reporting be as XXXX. we is for of GMV our what intend reporting -- we're year and year us little as guide full we front one, view last last the it for did we're on of to but in quarter we on given quarter next this on the have what not think GMV bit what a for So we will do a the give

Alessandra Jimenez

that other Is XXXX on just maybe Or there revenue-dependent? to get low then the and the guidance. end building And to profitability Understood. just high some us are kind there? of end What range? takes Okay. it are versus of blocks puts the

Brian Garner

Yes.

there's of would dynamic. and I in revenue think in pointed variability that you gross exists which of to highlight the the profit what a the challenging terms Obviously, also gross within the the I you point dynamics, to model. margin some environment. just I'd

I different potential think -- there's variability scenarios, the if explored we've for there.

XXXX manage But confident portfolio, we're that to our we protect in upside saw model, we'll downside. obviously the in to that's any think Goldilocks to and in XXXX, duration the against if the I said. ability persist continue like the here for scenario we

well revenue I an perspective, Yes, with gross is and really dynamic. margin is and factor. the dynamics gross SG&A profit margin cost sure the top line. those align think it's biggest on the manage we'll gross revenue we of we're our other those From single I remain what So win within control, outside and think seeing and

Alessandra Jimenez

see And the to helpful. then me. repurchase. Okay. upping announcement share very for dividend and lastly then That's regards pleased We're the to

the flow business, cash XXXX a what is of generation cash to off cash Just Should in flow EBITDA XXXX? free similar conversion and flow we the the given strong implied expect adjusted guide? of the

Brian Garner

I dynamic variable a think little capital the cash cash putting as think between have that street. consistent. on out fair. you There's relatively Yes. I in might a I you're and where cash is flow The EBITDA mean GMV tax that's But working taxes. big is free the relationship in more

attention pay to I'd usage exceed what that to starts pretty later So free can or there GMV to the our significant is plan start cash flow. come year. of obviously, be GMV if in a we

I you free cash and otherwise, between consistency But variability absent about it towards. you're flow, The point EBITDA the thinking those that's right. So dynamics.

Operator

the the time, question-and-answer and remarks. Chief this Michaels, would to closing session. Executive for turn call back At Officer, concludes That President to I Steven like

Steven Michaels

to, Yes. thank I'd continued your in and this Holdings. interest for like again, you guys us for joining PROG morning

and further a great X-pillar on Expand. Grow, portfolio you right positioning to XXXX. on did of investments in We the progress making a the in job teams technology QX about great our delivered call a good forward our strategy and our look you Enhance, We late and XXXX's of Our feel we're people to have updating day. our Hope during initiatives April. strong

Operator

does participation program. your you for conference. today's Thank This in the conclude

You may disconnect. now

PROG (PRG) 21 Feb 242023 Q4 Earnings call transcript