TORONTO , Nov. 28, 2019 /CNW/ - Axis Auto Finance Inc. ("Axis" or the "Company"), (TSXV: AXIS) Canada's fastest growing publicly-traded sub-prime automotive finance company, today announced financial results for the first quarter of fiscal 2020 ending September 30, 2019 . In the quarter, Axis adopted IFRS 16, the new accounting pronouncement which amends the accounting treatment for operating leases. The Company also made the decision to report non-IFRS measures of portfolio yield, credit losses, and interest expense based on gross finance receivable balances as opposed to based on net balances as was the case previously.
- Record quarterly originations of $19.3 million ;
- Record quarterly revenues of $9.0 million , a 14% increase over Q4 2019;
- Record gross finance receivables of $117.6 million , up from $114.7 million in fiscal 2019;
- Average portfolio yield of 32.9%, in line with 33.0% in 2019; and
- Adjusted earnings 1 of $0.5 million for Q1 2020.
Originations for the first quarter of fiscal 2020 were $19.3 million , as compared to $18.3 million in the first quarter 2019, the result of sustained penetration in existing markets and expansion into new markets that Axis entered in the second half of fiscal 2019.
The increase in originations contributed to the growth in gross finance receivables, which increased from $114.7 million at June 30, 2019 to $117.6 million at the end of the first quarter of fiscal 2020.
First quarter revenues were a record $9.0 million , a 6.6% increase from $8.4 million for the first quarter of fiscal 2019 and a 14% increase from Q4 of fiscal 2019. The increase in revenue is the result of portfolio growth and maintaining strong portfolio yields on newly originated finance receivables.
Portfolio yields in the first quarter 2020 remained strong at 32.9%, in line with both first quarter of fiscal 2019 and the full fiscal 2019, which produced yields of 33.0%.
Annualized credit losses rose from 9.41% in fiscal 2019 to 10.47% in the first quarter of fiscal 2020. Delinquency at the end of the first quarter of fiscal 2020 was 5.72%, down from 7.06% for the comparative period in fiscal 2019.
Adjusted earnings (loss) for Q1 2020 was $0.5 million , compared to ($0.5) million in Q4 2019 and $1.7 million for Q1 2019.
Net income (loss) for Q1 2020 was ($0.5) million or ($0.006) per share, as compared to ($0.3) million or ($0.004) per share in Q1 2019. Book value of the Company was $34.1 million at the end of the first quarter of fiscal 2020, or $0.35 per share.
About Axis Auto Finance
Axis Auto Finance is a leading Canadian provider of alternative used vehicle financing options servicing roughly 30% of Canadians (Source:Equifax) that have credit scores in the non-prime range. 100% of all Axis auto loans report to the credit bureau, resulting in a significant improvement of the credit scores for the overwhelming majority of clients. These clients use Axis as a stepping-stone in their credit rebuilding journey and we are proud to be improving the lives of these Canadians. Supported by state-of-the-art, in-house developed risk analytics, Axis continues to be Canada's fastest-growing publicly traded auto-financing company. Further information on the Company can be found at investors.axisautofinance.ca/.
1 In order to track the performance of its finance receivable portfolio in a given period without the volatility associated with estimates and assumptions, Axis introduced a non-IFRS measure called Adjusted Earnings. This measure, now included in the MD&A, is equal to the net income (loss) for the period, adjusted for (i) non-cash expense items (as identified in the Statement of Cash Flows) (ii) actual credit losses incurred (iii) non-recurring one time transaction and integration costs (iv) occupancy related lease costs not included in general and administrative expenses and (v) specified expenses which were entirely recognized in a given quarter but for which the benefit was derived over more than a given quarter. For further information on Axis non-IFRS measures, please see the Management's Discussion and Analysis for the corresponding period.
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SOURCE Axis Auto Finance Inc.
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