Regional Management Corp (RM) Reports Q3 2023 Earnings: Net Income of $8.8 Million
Regional Management Corp (NYSE:RM) reported a net income of $8.8 million and diluted earnings per share of $0.91 for Q3 2023.
Net finance receivables as of September 30, 2023, were $1.8 billion, an increase of 8.9% from the prior-year period.
Total revenue for the third quarter of 2023 was $140.9 million, up 7.2% from the prior-year period.
The company's Board of Directors declared a dividend of $0.30 per common share for the fourth quarter of 2023.
Regional Management Corp (NYSE:RM) announced its third-quarter results for 2023 on November 1, 2023. The company reported a net income of $8.8 million and diluted earnings per share of $0.91. The 30+ day contractual delinquency rate was 7.3% as of September 30, 2023. The company ended the third quarter with net receivables of $1.8 billion.
Financial Highlights
Net finance receivables as of September 30, 2023, were $1.8 billion, an increase of $143.4 million, or 8.9%, from the prior-year period. Large loan net finance receivables of $1.3 billion increased by 13.9% from the prior-year period and represented 72.6% of the total loan portfolio. Total loan originations were $425.1 million in the third quarter of 2023, an increase of 1.5% from the prior-year period.
Total revenue for the third quarter of 2023 was $140.9 million, an increase of $9.4 million, or 7.2%, from the prior-year period. Interest and fee income increased by 7.8% primarily due to higher average net finance receivables. However, insurance income, net decreased by 5.0% due to lower premiums.
Provision for Credit Losses and Operating Expenses
The provision for credit losses for the third quarter of 2023 was $50.9 million, an increase of 5.9% from the prior-year period. The allowance for credit losses was $184.9 million as of September 30, 2023, or 10.6% of net finance receivables.
General and administrative expenses for the third quarter of 2023 were $62.1 million, an increase of 6.8% from the prior-year period. The operating expense ratio for the third quarter of 2023 was 14.4%, a 50 basis point improvement compared to the prior-year period.
Dividend Announcement
The company's Board of Directors has declared a dividend of $0.30 per common share for the fourth quarter of 2023. The dividend will be paid on December 13, 2023, to shareholders of record as of the close of business on November 22, 2023.
Liquidity and Capital Resources
As of September 30, 2023, the company had net finance receivables of $1.8 billion and debt of $1.4 billion. The company's unused capacity to fund future growth on its revolving credit facilities was $613 million, or 77.1%, and the company had available liquidity of $179.2 million.
Explore the complete 8-K earnings release (here) from Regional Management Corp for further details.
This article first appeared on GuruFocus.
