Consumer Portfolio Services (CPSS) Q1 2025 Earnings Call May 13, 2025 01:00 PM ET Speaker0 Good day, everyone, and welcome to the Consumer Portfolio Services twenty twenty five First Quarter Operating Results Conference Call. Today's call is being recorded. Before we begin, management has asked me to inform you that this conference call may contain forward looking statements. Any statements made during this call that are not statements of historical facts may be deemed forward looking statements. Statements ...

Financial Performance - CPS reported earnings of $4.7 million, or $0.19 per diluted share, for Q1 2025, compared to $4.6 million, or $0.19 per diluted share, in Q1 2024[3][4] - Revenues for Q1 2025 were $106.9 million, an increase of $15.2 million, or 16.6%, from $91.7 million in Q1 2024[4][9] - Interest income for Q1 2025 was $101.9 million, an increase of 11.4% from $84.3 million in Q1 2024[17] - The company’s net interest margin for Q1 2025 was 51.96%, compared to 49.78% in Q1 2024[17] Portfolio and Contracts - Total portfolio balance reached $3.615 billion as of March 31, 2025, the highest in company history, up from $3.021 billion a year earlier[5][17] - New contract purchases amounted to $451.2 million in Q1 2025, compared to $346.3 million in Q1 2024[5][17] - CPS achieved the highest amount in new loan originations for any first quarter in company history[7] Credit Quality - Annualized net charge-offs for Q1 2025 were 7.54% of the average portfolio, down from 7.84% in Q1 2024[6][17] - Delinquencies greater than 30 days were 12.35% of the total portfolio as of March 31, 2025, slightly down from 12.39% a year earlier[6][17] Future Plans - The company plans to hold a conference call on May 13, 2025, to discuss its Q1 2025 operating results[7][8]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 For the transition period from _____to_____ Commission file number: 001-11416 CONSUMER PORTFOLIO SERVICES, INC. (Exact name of registrant as specified in its charter) California 33-0459135 (State or other jurisdiction of incorporation or organization) (IRS Employer Identification No.) 3800 Howard Hughes Parkway, Suite 1400, Las Vegas, Nevada 89169 (Address of principal executive offices) (Zip Code) FORM 10-Q ☒ QUARTERLY ...

LAS VEGAS, Nevada, May 12, 2025 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) announced the closing of its second term securitization in 2025 on Monday May 12, 2025. The transaction is CPS's 55th senior subordinate securitization since the beginning of 2011 and the 38th consecutive securitization to receive a triple “A” rating from at least two rating agencies on the senior class of notes. In the transaction, qualified institutional buyers purchased $419.95 mi ...

Las Vegas, Nevada, May 09, 2025 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) today announced that it will hold a conference call on Tuesday, May 13, 2025 at 1:00 p.m. ET to discuss its first quarter 2025 operating results. Those wishing to participate can pre-register for the conference call at the following link https://register-conf.media-server.com/register/BIa727447d5fdf49d4b7da9c96f3d668b7. Registered participants will receive an email containing confere ...

LAS VEGAS, NV, May 08, 2025 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”), a leader in providing indirect automobile financing to consumers, today announced the deployment of a next-generation AI-powered servicing and collections platform developed in partnership with Salient, a leading provider of AI voice agent solutions tailored for the automotive industry. As Consumer Portfolio Services continues to scale its loan portfolio and optimize servicing operation ...

LAS VEGAS, Nevada, March 20, 2025 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) today announced the closing of a $65.0 million securitization of residual interests from previously issued securitizations. In the transaction, a qualified institutional buyer purchased $65.0 million of asset-backed notes secured by an 80% interest in a CPS majority owned affiliate (“MOA”) that owns the residual interests in five CPS securitizations issued from October 2023 through ...

Debt and Financing - As of December 31, 2024, the company had approximately $3,131.0 million in outstanding debt, including $2,594.4 million in securitization trust debt and $410.9 million in warehouse lines of credit [123]. - The company's current short-term funding capacity is $535 million, consisting of two credit facilities [121]. - The ability to maintain warehouse or securitization financing on acceptable terms is crucial for the company's operations and could significantly impact its financial health [122]. - Risk retention rules require the company to retain at least 5% of the credit risk for securitizations executed after December 2016, potentially limiting liquidity and increasing capital requirements [154]. Economic and Market Risks - Economic downturns can lead to increased delinquencies, defaults, and losses, adversely impacting the company's financial position and liquidity [131]. - Economic downturns, particularly in regions like California, Texas, Ohio, Illinois, and Florida, could lead to increased delinquencies and adversely affect the company's operations [173]. - Natural disasters in key states could result in job losses or damage to vehicles securing contracts, leading to reduced collections and revenue [176]. - An increase in interest rates could decrease cash flows from excess spread, adversely affecting earnings and cash flows [179]. Performance and Credit Risks - The company relies on cash flows from residual interests in securitization programs and warehouse credit facilities, which are affected by the performance of the underlying automobile contracts [129]. - The performance of automobile contracts significantly impacts the company's results of operations, financial condition, cash flows, and liquidity, with defaults potentially leading to material adverse effects [142]. - The company specializes in sub-prime automobile contracts, which carry higher risks of non-performance and delinquencies compared to contracts with more creditworthy customers [141]. - An allowance for credit losses is maintained for receivables originated prior to January 2018, reflecting estimates of probable credit losses; inadequate allowances could adversely affect results [143]. - Receivables originated since January 2018 are recorded at fair value, and if actual credit losses exceed estimates, it may necessitate fair value adjustments or reduced interest income [144]. - The company cannot borrow against defaulted automobile contracts under warehouse credit facilities, which may reduce cash flows available [145]. - A downward adjustment in the recorded value of receivables could reduce the company's income and book value if actual credit losses exceed estimates [171]. - The fair value of receivables may require adjustment if market conditions indicate a significantly lower value than recorded, impacting income and book value [172]. Operational Risks - Loss of servicing rights on the portfolio of automobile contracts could materially impair results of operations and financial condition [146]. - Key personnel retention is critical; loss of key employees could adversely affect results of operations and financial condition [147]. - The company faces litigation risks that could result in significant financial penalties and adversely affect operations and cash flows [156]. - Non-compliance with regulations could lead to penalties, litigation losses, and damage to reputation, adversely affecting financial condition and stock price [150]. Stock and Dividend Policy - The company's common stock is thinly traded, leading to limited selling opportunities and potential price volatility; as of December 31, 2024, directors and executive officers owned approximately 61% of total shares outstanding [180]. - The company has never declared or paid cash dividends on its common stock and intends to retain future earnings without paying dividends in the foreseeable future [181]. Interest Rate Impact - Increased interest expenses were experienced in 2023 due to multiple interest rate hikes by the Federal Reserve, with uncertainty regarding future rate changes [138]. - The company may need to reduce interest income recognized on receivables if actual results materially deviate from estimates, particularly regarding future credit losses and prepayment rates [170]. - Fair value accounting for receivables acquired since January 1, 2018 introduces risks related to the valuation and potential adjustments impacting financial results [169].

Consumer Portfolio Services, Inc. (NASDAQ:CPSS) Q4 2024 Earnings Conference Call February 26, 2025 1:00 PM ET Company Participants Charles Bradley - CEO & Chairman Denesh Bharwani - CFO and EVP, Accounting & Finance Michael Lavin - President, COO & Chief Legal Officer Conference Call Participants Operator Good day, everyone, and welcome to the Consumer Portfolio Services 2024 fourth quarter operating results conference call. Today's call is being recorded. Before we begin, management has asked me to inform ...

Financial Data and Key Metrics Changes - Revenues for Q4 2024 were $105.3 million, a 5% increase from $100.6 million in Q3 2024 and a 14% increase from $92 million in Q4 2023 [8] - For the year, total revenues reached $393.5 million, a 12% increase from $352 million in 2023 [8] - Net income for Q4 2024 was $5.1 million, down from $7.2 million in Q4 2023, while annual net income was $19.2 million compared to $45.3 million in 2023 [13][14] - Pretax earnings for Q4 2024 were $7.4 million, down 24% from $9.8 million in Q4 2023, with annual pretax earnings at $27.4 million compared to $61.1 million in 2023 [13][14] - Total debt increased to $3.131 billion, a 22% rise from $2.566 billion at the end of 2023 [15] Business Line Data and Key Metrics Changes - Loan originations for Q4 2024 were $458 million, a 52% increase from $302 million in Q4 2023, with annual originations at $1.68 billion, a 24% increase from $1.36 billion in 2023 [9][19] - The fair value portfolio reached $3.5 billion, yielding 11.3% net of losses [10] - Core operating expenses as a percentage of the managed portfolio decreased to 5.4% in Q4 2024 from 5.9% in Q4 2023 [17] Market Data and Key Metrics Changes - The average FICO score for the portfolio was 571, with an average amount financed of $22,300 per deal [28] - The annual net charge-offs for Q4 2024 were 8.02% of the average portfolio, compared to 7.74% in Q4 2023 [29] - Delinquency greater than 30 days was 14.85% of the total portfolio, slightly up from 14.55% at the end of 2023 [30] Company Strategy and Development Direction - The company is focusing on cautious growth while improving credit performance and preparing for aggressive growth in 2025 [4][6] - Plans include hiring additional sales representatives and expanding into new territories to increase market share [22] - The company aims to tighten its credit model while still pursuing growth opportunities [32] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the economic environment, citing a favorable unemployment rate projected to remain low [38][47] - The company anticipates that the performance of 2024 vintages will improve as they flow through the portfolio, with expectations to phase out weaker 2022 vintages by the end of 2025 [43][46] - Management highlighted the importance of technology advancements, including AI-driven fraud detection, to enhance operational efficiency and reduce costs [39][41] Other Important Information - The company reported a significant reduction in loan provision adjustments from $22.3 million in 2023 to $5.3 million in 2024 [11] - The company has successfully reduced funding times and increased same-day funding rates, enhancing dealer relationships [27] Q&A Session Summary Question: What are the expectations for growth in 2025? - Management indicated that they are gearing up for growth in 2025, having already hired new sales reps and opened new territories in anticipation of increased market share [22][46] Question: How is the company managing credit risk? - The company is tightening its credit model while still focusing on growth, with expectations that the performance of newer vintages will improve [32][43] Question: What are the key drivers of revenue growth? - Revenue growth is primarily driven by strong loan originations and an increase in the fair value portfolio [9][10]