CACC - Earnings call 3 2023 | Credit Acceptance Corporation

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Operator

Good day, everyone, and welcome to the Credit Acceptance Corporation Third Quarter 2023 Earnings Call. Today's call is being recorded. A webcast and transcript of today's earnings call will be made available on Credit Acceptance's website.

At this time, I would like to turn the call over to Credit Acceptance Chief Treasury Officer, Doug Busk.

Douglas Busk

Thank you. to Acceptance welcome XXXX Third and Call. Earnings afternoon, the Corporation Credit Quarter Good

our posted federal as news Relations read within recognize you As release forward-looking contain our this call, statements at that to both section meaning on website, ir.creditacceptance.com, laws. listen and of you the conference please securities of Investor the

include and materially control cautionary statements other forward-looking risks from Consider the out results of statement and which many statements and regarding risks those uncertainties, actual These uncertainties. forward-looking are These statements. cause beyond such subject and uncertainties our spelled of to news in forward-looking in all in those could and the to differ light of information a number included which risks release. are

comply measures mention which the measures. to refer of should G, please results to non-GAAP the release, our news I how Regulation reconcile that to showing SEC's financial section GAAP tables with provides Additionally,

quarter rates net GAAP include: $XX X.X% Our for decrease forecasted in compared quarter flows rates the by of to decreased decreased million in million $XX third net that forecasted the XXXX, by or during a flows and X.X%. cash decrease a collection forecasted forecasted cash adjusted or results the collection

below and forecasted consumer consumer in for average to a decrease forecast collection estimates was net lower rates result at primarily of XXXX the loans than slower profitability as forecasted decline during through XXXX, since We quarter loan our to levels. cash due September in assigned XXXX, in XXXX of a a that flow XX, timing third prepayments XXXX

the increase the portfolio and average on quarter XXXX. X.X% of XXXX, An spread in GAAP third completed on XX% adjusted on the debt, rates. of recently in our balance in XX.X%, basis result compared volumes XX.X% with which to consumer increase XXXX. of or dollar and assignments loans XX.X%, of a average respectively, lower was to initial loan as rates grew an The respectively, and to loan of as and the and secured consumer to third increased XX.X% a interest our quarter secured quarter assigned primarily Unit third compared cost older extended the on compared higher financings interest of of repayment financing

and decreased Chief the Adjusted your Adjusted Senior net third $XX.XX. questions. income XXXX the XX% Vice time, take quarter XX% decreased this Executive third and from XXXX Martin, Jay from of $XXX will per Officer; our of Accounting, Booth, quarter I President, At our to Ken share earnings million. to Finance

Operator

Rowan first Instructions] question Scott. from [Operator comes John Our of Janney Montgomery

John Rowan

So when cycle think X/X financial crisis we've those and you of forecasted kind that at I went every the frame forecast or company collections. was that time back roughly obviously, away. long after it was that, a the whether to charges And of looking it took seen, rightsize about great in COVID overall revisions then

right? Is collection different number We're X downside. makes difficult quarters of row something the a environment Is there it now I'm seeing still to to reverberations, Or these CECL? trying why cycle, still prices? into figure COVID it it and negative is much car so it get more that revisions forecasted about at charges. is we're we're on this in out the that longer just

Douglas Busk

I doesn't don't do CECL. with it accounting. mean to I just that's -- anything have

to the rates in. for taken collection don't why a for 'XX longer to In have terms of as it's in settle particular, [indiscernible] perfect reason estimating forecasted

that deal in which was had -- is had at very elevated those pretty never used the a with. prices, the competitive unique previously inflation, impact were time, loans we've in car to were have We and something industry very originated we of

answer So best you. give can -- the I that's really about

John Rowan

material disclosures CFPB be out, given came Okay. suit. to an saw there's and any has York I But that it on obviously, New it X. say there's seem -- regarding update does And Q that the the November just like then AG doesn't

there a would you stayed. forward it's Is tell time anything would which just on update that possible what November I is can obviously, case move to this in again frame because us that still happens understand include? Or about currently want X. what

Douglas Busk

our think that is has the don't CFP I constitutionality Supreme Yes. The decision. court the with stay really that or going rules granted until happen motion to to case on of the -- CFPB. the case anything on pending the a Court

don't court. what know with discussed we early exactly I the in November So

But I Supreme -- motion Court's court the has decision. the granted to pending stay a

Operator

John from question comes And our Hecht of Jefferies. next

John Hecht

is this of because you kind emerged John's guess maker price related fallen a question my competitors back. a bit to is cycle. a In longer guys have other as just little I cycles, as prior have question, prior

future there the of But see a look any even indications would were be years the issuing at through that you're if coming of spreads we've market? favorable below few cycle they're tough still time. competitive I'm you describe you'd may a or that for it And period kind the something in where a they more gone wondering kind is how because now, of you that ago, such

Douglas Busk

QX think think competitive happy with. materially. October of the portfolio at through first rates grew loan favorable I today. days and we grew originations the We relatively Volume that is environment up the is XX in we're

favorable. is environment competitive the think I So

recently. I The certainly to how future, going it's the industry But competitive is even to access in pleased more ago. indicate going know a was the really I out didn't it a when play we're with the date. than time. how existed but that think period credit It's that certainly the that, to October crisis favorable capital environment for volume that's it's have And situation better year a don't that would of in not like

John Hecht

expected environment? spurts kind And past -- you're and you cash credit the then fits just, I quarters the Maybe guess, the flows maybe that. comment you and can just obviously, discuss had in writing of over down few on

been more now? tied in a it service is debts values because it asset you their describe market is is do and the how is to consumers' to -- credit exhausted just ability right it mean, inflation? the I -- consumer the Or that's it by

Douglas Busk

I Yes. several would you inflation of it's X mentioned the probably and material factors, think -- mean that X the contributors. a be asset most combination values I

Operator

from Wildhack And question our Research. of Autonomous Instructions] next Robert comes [Operator

Robert Wildhack

Just business? in back to structural? temporary words, last out up other on Is follow the the i.e., point that competitive do competitive Why the some is behind what's there. improvement just or landscape? going for bit? that In -- competitors of Or a think the pulling you reason the

Douglas Busk

in been that business consumers. There of vehicle gone have have but huge the to exited sub-prime used financing out participants or some market, companies they been haven't

a So having more differently the I it's loans industry of rates. just participants due interest to think other their function to in increase price

reacting probably credit in I to think softness performance. people also are

Robert Wildhack

change Okay. And the all the all you And then revisions did relates recent collections, forecasted in approval in your to rate as it in downward have at quarters? you October? then rate at approval your adjusted

Douglas Busk

everyone. haven't We mean, seen a material I approve -- we

change So approval haven't policy haven't October. we changes seen we And meaningful in made our policies. or a any in in price

Robert Wildhack

Okay. No change in October.

Douglas Busk

No material changes, no.

Operator

for to conference in remarks. to over closing questions turn the the back further no I would additional any or Busk queue. Mr. like With

Douglas Busk

for joining We thank their support on us call to today. would like for and conference our everyone

to them please to Thank our additional you follow-up you. Investor next at have We quarter. look mailbox Relations to again ir.creditacceptance.com. direct questions, you any talking If forward

Operator

conference. conclude your today's does again, We thank Once you participation. for this

Credit Acceptance (CACC) 30 Oct 232023 Q3 Earnings call transcript