Page | ||||
PART I. FINANCIAL INFORMATION | ||||
Item 1. | Financial Statements (Unaudited) | |||
Consolidated Balance Sheets | ||||
Consolidated Statements of Operations | ||||
Consolidated Statements of Comprehensive (Loss) Income | ||||
Consolidated Statement of Shareholders’ Deficit | ||||
Consolidated Statements of Cash Flows | ||||
Notes to Consolidated Financial Statements | ||||
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | |||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | |||
Item 4. | Controls and Procedures | |||
Part II. OTHER INFORMATION | ||||
Item 1. | Legal Proceedings | |||
Item 1A. | Risk Factors | |||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | |||
Item 3. | Defaults Upon Senior Securities | |||
Item 4. | Mine Safety Disclosure | |||
Item 5. | Other Information | |||
Item 6. | Exhibits | |||
Signatures | ||||
ITEM 1. | FINANCIAL STATEMENTS |
March 31, 2018 | December 31, 2017 | ||||||
Assets | |||||||
Unrestricted cash and cash equivalents | $ | 35,414 | $ | 41,484 | |||
Restricted cash and cash equivalents | 31,240 | 29,174 | |||||
Loans and fees receivable: | |||||||
Loans and fees receivable, at fair value | 9,413 | 11,109 | |||||
Loans and fees receivable, gross | 400,727 | 393,898 | |||||
Allowances for uncollectible loans and fees receivable | (58,323 | ) | (62,970 | ) | |||
Deferred revenue | (36,097 | ) | (36,956 | ) | |||
Net loans and fees receivable | 315,720 | 305,081 | |||||
Property at cost, net of depreciation | 3,021 | 3,229 | |||||
Investment in equity-method investee | 3,561 | 4,244 | |||||
Deposits | 272 | 252 | |||||
Prepaid expenses and other assets | 43,684 | 42,149 | |||||
Total assets | $ | 432,912 | $ | 425,613 | |||
Liabilities | |||||||
Accounts payable and accrued expenses | $ | 114,709 | $ | 115,737 | |||
Notes payable, at face value, net | 242,130 | 226,238 | |||||
Notes payable to related parties | 40,000 | 40,000 | |||||
Notes payable associated with structured financings, at fair value | 7,909 | 9,240 | |||||
Convertible senior notes | 61,650 | 61,393 | |||||
Income tax liability | 9,465 | 9,132 | |||||
Total liabilities | 475,863 | 461,740 | |||||
Commitments and contingencies (Note 9) | |||||||
Equity | |||||||
Common stock, no par value, 150,000,000 shares authorized: 15,353,878 shares issued and outstanding (including 1,459,233 loaned shares to be returned) at March 31, 2018; and 15,291,884 shares issued and outstanding (including 1,459,233 loaned shares to be returned) at December 31, 2017 | — | — | |||||
Additional paid-in capital | 213,025 | 212,785 | |||||
Accumulated other comprehensive loss | (4,523 | ) | (2,178 | ) | |||
Retained deficit | (251,310 | ) | (246,640 | ) | |||
Total shareholders’ equity | (42,808 | ) | (36,033 | ) | |||
Noncontrolling interests | (143 | ) | (94 | ) | |||
Total equity | (42,951 | ) | (36,127 | ) | |||
Total liabilities and equity | $ | 432,912 | $ | 425,613 |
For the Three Months Ended March 31, | ||||||||
2018 | 2017 | |||||||
Interest income: | ||||||||
Consumer loans, including past due fees | $ | 35,681 | $ | 25,859 | ||||
Other | 45 | 101 | ||||||
Total interest income | 35,726 | 25,960 | ||||||
Interest expense | (8,153 | ) | (5,817 | ) | ||||
Net interest income before fees and related income on earning assets and provision for losses on loans and fees receivable | 27,573 | 20,143 | ||||||
Fees and related income on earning assets | 6,214 | 2,801 | ||||||
(Losses upon) net recovery of charge off of loans and fees receivable recorded at fair value | (1,791 | ) | 7,851 | |||||
Provision for losses on loans and fees receivable recorded at net realizable value | (15,991 | ) | (10,653 | ) | ||||
Net interest income, fees and related income on earning assets | 16,005 | 20,142 | ||||||
Other operating income: | ||||||||
Servicing income | 632 | 1,089 | ||||||
Other income | 516 | 109 | ||||||
Equity in income of equity-method investee | 9 | 334 | ||||||
Total other operating income | 1,157 | 1,532 | ||||||
Other operating expense: | ||||||||
Salaries and benefits | 6,298 | 5,780 | ||||||
Card and loan servicing | 9,164 | 7,137 | ||||||
Marketing and solicitation | 2,346 | 2,201 | ||||||
Depreciation | 229 | 310 | ||||||
Other | 3,700 | 4,901 | ||||||
Total other operating expense | 21,737 | 20,329 | ||||||
(Loss) income before income taxes | (4,575 | ) | 1,345 | |||||
Income tax expense | (144 | ) | (618 | ) | ||||
Net (loss) income | (4,719 | ) | 727 | |||||
Net loss attributable to noncontrolling interests | 49 | 1 | ||||||
Net (loss) income attributable to controlling interests | $ | (4,670 | ) | $ | 728 | |||
Net (loss) income attributable to controlling interests per common share—basic | $ | (0.34 | ) | $ | 0.05 | |||
Net (loss) income attributable to controlling interests per common share—diluted | $ | (0.34 | ) | $ | 0.05 |
For the Three Months Ended March 31, | ||||||||
2018 | 2017 | |||||||
Net (loss) income | $ | (4,719 | ) | $ | 727 | |||
Other comprehensive loss: | ||||||||
Foreign currency translation adjustment | (2,345 | ) | — | |||||
Reclassifications of foreign currency translation adjustment to Other operating expense on the consolidated statements of operations | — | — | ||||||
Income tax benefit related to other comprehensive loss | — | — | ||||||
Comprehensive (loss) income | (7,064 | ) | 727 | |||||
Comprehensive loss attributable to noncontrolling interests | 49 | 1 | ||||||
Comprehensive (loss) income attributable to controlling interests | $ | (7,015 | ) | $ | 728 |
Common Stock | ||||||||||||||||||||||||||
Shares Issued | Amount | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Deficit | Noncontrolling Interests | Total Equity | ||||||||||||||||||||
Balance at December 31, 2017 | 15,291,884 | $ | — | $ | 212,785 | $ | (2,178 | ) | $ | (246,640 | ) | $ | (94 | ) | $ | (36,127 | ) | |||||||||
Compensatory stock issuances, net of forfeitures | 69,000 | — | — | — | — | — | — | |||||||||||||||||||
Amortization of deferred stock-based compensation costs | — | — | 254 | — | — | — | 254 | |||||||||||||||||||
Redemption and retirement of shares | (7,006 | ) | — | (14 | ) | — | — | — | (14 | ) | ||||||||||||||||
Other comprehensive loss | — | — | — | (2,345 | ) | (4,670 | ) | (49 | ) | (7,064 | ) | |||||||||||||||
Balance at March 31, 2018 | 15,353,878 | $ | — | $ | 213,025 | $ | (4,523 | ) | $ | (251,310 | ) | $ | (143 | ) | $ | (42,951 | ) |
For the Three Months Ended March 31, | |||||||
2018 | 2017 | ||||||
Operating activities | |||||||
Net (loss) income | $ | (4,719 | ) | $ | 727 | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||||||
Depreciation, amortization and accretion, net | 229 | 310 | |||||
Losses upon charge off of loans and fees receivable recorded at fair value | 1,791 | 1,093 | |||||
Provision for losses on loans and fees receivable | 15,991 | 10,653 | |||||
Interest expense from accretion of discount on notes | 216 | 178 | |||||
Income from accretion of discount associated with receivables purchases | (18,020 | ) | (12,263 | ) | |||
Unrealized gain on loans and fees receivable and underlying notes payable held at fair value | (1,313 | ) | (1,269 | ) | |||
Amortization of deferred loan costs | 390 | 126 | |||||
Income from equity-method investments | (9 | ) | (334 | ) | |||
Changes in assets and liabilities: | |||||||
Increase in uncollected fees on earning assets | (802 | ) | (983 | ) | |||
Increase in income tax liability | 333 | 438 | |||||
(Increase) decrease in deposits | (20 | ) | 200 | ||||
(Decrease) increase in accounts payable and accrued expenses | (4,323 | ) | 3,530 | ||||
Other | 19 | (9 | ) | ||||
Net cash (used in) provided by operating activities | (10,237 | ) | 2,397 | ||||
Investing activities | |||||||
Proceeds from equity-method investee | 692 | 1,066 | |||||
Investments in earning assets | (125,768 | ) | (99,045 | ) | |||
Proceeds from earning assets | 116,164 | 93,961 | |||||
Purchases and development of property, net of disposals | (21 | ) | (22 | ) | |||
Net cash used in investing activities | (8,933 | ) | (4,040 | ) | |||
Financing activities | |||||||
Purchase and retirement of outstanding stock | (14 | ) | (18 | ) | |||
Proceeds from borrowings | 89,538 | 64,761 | |||||
Repayment of borrowings | (73,996 | ) | (61,248 | ) | |||
Net cash provided by financing activities | 15,528 | 3,495 | |||||
Effect of exchange rate changes on cash | (362 | ) | 50 | ||||
Net (decrease) increase in unrestricted cash | (4,004 | ) | 1,902 | ||||
Cash and cash equivalents at beginning of period | 70,658 | 92,641 | |||||
Cash and cash equivalents at end of period | $ | 66,654 | $ | 94,543 | |||
Supplemental cash flow information | |||||||
Cash paid for interest | $ | 8,718 | $ | 6,698 | |||
Net cash income tax (refunds) payments | $ | (189 | ) | $ | 180 | ||
Supplemental non-cash information | |||||||
Issuance of stock options and restricted stock | $ | 169 | $ | 1,005 |
1. | Description of Our Business |
2. | Significant Accounting Policies and Consolidated Financial Statement Components |
For the Three Months Ended March 31, 2018 | Credit Cards | Auto Finance | Other Unsecured Lending Products | Total | ||||||||||||
Allowance for uncollectible loans and fees receivable: | ||||||||||||||||
Balance at beginning of period | $ | (18.2 | ) | $ | (2.3 | ) | $ | (42.5 | ) | $ | (63.0 | ) | ||||
Provision for loan losses | (9.0 | ) | — | (7.0 | ) | (16.0 | ) | |||||||||
Charge offs | 6.5 | 0.7 | 15.1 | 22.3 | ||||||||||||
Recoveries | (0.1 | ) | (0.3 | ) | (1.2 | ) | (1.6 | ) | ||||||||
Balance at end of period | $ | (20.8 | ) | $ | (1.9 | ) | $ | (35.6 | ) | $ | (58.3 | ) |
As of March 31, 2018 | Credit Cards | Auto Finance | Other Unsecured Lending Products | Total | ||||||||||||
Allowance for uncollectible loans and fees receivable: | ||||||||||||||||
Balance at end of period individually evaluated for impairment | $ | — | $ | — | $ | (0.2 | ) | $ | (0.2 | ) | ||||||
Balance at end of period collectively evaluated for impairment | $ | (20.8 | ) | $ | (1.9 | ) | $ | (35.4 | ) | $ | (58.1 | ) | ||||
Loans and fees receivable: | ||||||||||||||||
Loans and fees receivable, gross | $ | 97.8 | $ | 78.4 | $ | 224.5 | $ | 400.7 | ||||||||
Loans and fees receivable individually evaluated for impairment | $ | — | $ | 0.1 | $ | 0.2 | $ | 0.3 | ||||||||
Loans and fees receivable collectively evaluated for impairment | $ | 97.8 | $ | 78.3 | $ | 224.3 | $ | 400.4 |
For the Three Months Ended March 31, 2017 | Credit Cards | Auto Finance | Other Unsecured Lending Products | Total | ||||||||||||
Allowance for uncollectible loans and fees receivable: | ||||||||||||||||
Balance at beginning of period | $ | (1.4 | ) | $ | (2.1 | ) | $ | (39.8 | ) | $ | (43.3 | ) | ||||
Provision for loan losses | (0.4 | ) | (0.4 | ) | (9.9 | ) | (10.7 | ) | ||||||||
Charge offs | 0.4 | 0.8 | 14.6 | 15.8 | ||||||||||||
Recoveries | (0.4 | ) | (0.3 | ) | (0.6 | ) | (1.3 | ) | ||||||||
Balance at end of period | $ | (1.8 | ) | $ | (2.0 | ) | $ | (35.7 | ) | $ | (39.5 | ) |
As of December 31, 2017 | Credit Cards | Auto Finance | Other Unsecured Lending Products | Total | ||||||||||||
Allowance for uncollectible loans and fees receivable: | ||||||||||||||||
Balance at end of period individually evaluated for impairment | $ | — | $ | (0.2 | ) | $ | (0.2 | ) | $ | (0.4 | ) | |||||
Balance at end of period collectively evaluated for impairment | $ | (18.2 | ) | $ | (2.1 | ) | $ | (42.3 | ) | $ | (62.6 | ) | ||||
Loans and fees receivable: | ||||||||||||||||
Loans and fees receivable, gross | $ | 87.2 | $ | 77.8 | $ | 228.9 | $ | 393.9 | ||||||||
Loans and fees receivable individually evaluated for impairment | $ | — | $ | 0.4 | $ | 0.2 | $ | 0.6 | ||||||||
Loans and fees receivable collectively evaluated for impairment | $ | 87.2 | $ | 77.4 | $ | 228.7 | $ | 393.3 |
Balance at March 31, 2018 | Credit Cards | Auto Finance | Other Unsecured Lending Products | Total | ||||||||||||
30-59 days past due | $ | 2.8 | $ | 4.3 | $ | 7.1 | $ | 14.2 | ||||||||
60-89 days past due | 2.7 | 1.4 | 5.9 | 10.0 | ||||||||||||
90 or more days past due | 6.9 | 1.3 | 14.7 | 22.9 | ||||||||||||
Delinquent loans and fees receivable, gross | 12.4 | 7.0 | 27.7 | 47.1 | ||||||||||||
Current loans and fees receivable, gross | 85.4 | 71.4 | 196.8 | 353.6 | ||||||||||||
Total loans and fees receivable, gross | $ | 97.8 | $ | 78.4 | $ | 224.5 | $ | 400.7 | ||||||||
Balance of loans 90 or more days past due and still accruing interest and fees | $ | — | $ | 1.1 | $ | — | $ | 1.1 |
Balance at December 31, 2017 | Credit Cards | Auto Finance | Other Unsecured Lending Products | Total | |||||||||||
30-59 days past due | $ | 3.2 | $ | 6.4 | $ | 9.0 | $ | 18.6 | |||||||
60-89 days past due | 3.3 | 2.1 | 7.1 | 12.5 | |||||||||||
90 or more days past due | 4.9 | 1.9 | 15.7 | 22.5 | |||||||||||
Delinquent loans and fees receivable, gross | 11.4 | 10.4 | 31.8 | 53.6 | |||||||||||
Current loans and fees receivable, gross | 75.8 | 67.4 | 197.1 | 340.3 | |||||||||||
Total loans and fees receivable, gross | $ | 87.2 | $ | 77.8 | $ | 228.9 | $ | 393.9 | |||||||
Balance of loans 90 or more days past due and still accruing interest and fees | $ | — | $ | 1.6 | $ | — | $ | 1.6 |
As of | ||||||||||||||||
March 31, 2018 | December 31, 2017 | |||||||||||||||
Point-of-sale | Direct-to-consumer | Point-of-sale | Direct-to-consumer | |||||||||||||
Number of accounts on non-accrual status | 11,711 | 8,650 | 11,432 | 6,681 | ||||||||||||
Number of accounts on non-accrual status above that have been re-aged | 1,135 | 157 | 915 | 80 | ||||||||||||
Amount of receivables on non-accrual status (in thousands) | $ | 17,388 | $ | 8,778 | $ | 17,169 | $ | 7,067 | ||||||||
Amount of receivables on non-accrual status above that have been re-aged (in thousands) | $ | 2,048 | $ | 171 | $ | 1,570 | $ | 86 | ||||||||
Carrying value of receivables on non-accrual status (in thousands) | $ | 5,431 | $ | 1,365 | $ | 4,247 | $ | 1,173 | ||||||||
TDRs - Performing (carrying value, in thousands)* | $ | 3,563 | $ | 856 | $ | 2,368 | $ | 508 | ||||||||
TDRs - Nonperforming (carrying value, in thousands)* | $ | 1,868 | $ | 509 | $ | 1,879 | $ | 665 |
Twelve Months Ended | ||||||||||||
March 31, 2018 | March 31, 2017 | |||||||||||
Point-of-Sale | Direct-to-Consumer | Point-of-Sale | Direct-to-Consumer | |||||||||
Number of accounts | 1,881 | 868 | 1,617 | 654 | ||||||||
Loan balance at time of charge off (in thousands) | $ | 2,885 | $ | 1,845 | $1,860 | $1,906 |
Three months ended March 31, | ||||||||
2018 | 2017 | |||||||
Fees on credit products | $ | 4,905 | $ | 1,096 | ||||
Changes in fair value of loans and fees receivable recorded at fair value | (18 | ) | 563 | |||||
Changes in fair value of notes payable associated with structured financings recorded at fair value | 1,331 | 706 | ||||||
Rental revenue | — | 148 | ||||||
Other | (4 | ) | 288 | |||||
Total fees and related income on earning assets | $ | 6,214 | $ | 2,801 |
Three months ended March 31, 2018 | Credit and Other Investments | Auto Finance | Total | ||||||||
Interchange revenues, net (1) | $ | 444 | $ | — | $ | 444 | |||||
Service charges and other customer related fees | 25 | 47 | 72 | ||||||||
Total Other income | 469 | 47 | 516 |
3. | Segment Reporting |
Three months ended March 31, 2018 | Credit and Other Investments | Auto Finance | Total | |||||||||
Interest income: | ||||||||||||
Consumer loans, including past due fees | $ | 28,562 | $ | 7,119 | $ | 35,681 | ||||||
Other | 45 | — | 45 | |||||||||
Total interest income | 28,607 | 7,119 | 35,726 | |||||||||
Interest expense | (7,892 | ) | (261 | ) | (8,153 | ) | ||||||
Net interest income before fees and related income on earning assets and provision for losses on loans and fees receivable | $ | 20,715 | $ | 6,858 | $ | 27,573 | ||||||
Fees and related income on earning assets | $ | 6,197 | $ | 17 | $ | 6,214 | ||||||
Servicing income | $ | 402 | $ | 230 | $ | 632 | ||||||
Equity in income of equity-method investee | $ | 9 | $ | — | $ | 9 | ||||||
(Loss) income before income taxes | $ | (6,914 | ) | $ | 2,339 | $ | (4,575 | ) | ||||
Income tax benefit (expense) | $ | 399 | $ | (543 | ) | $ | (144 | ) | ||||
Total assets | $ | 365,882 | $ | 67,030 | $ | 432,912 |
Three months ended March 31, 2017 | Credit and Other Investments | Auto Finance | Total | |||||||||
Interest income: | ||||||||||||
Consumer loans, including past due fees | $ | 18,830 | $ | 7,029 | $ | 25,859 | ||||||
Other | 101 | — | 101 | |||||||||
Total interest income | 18,931 | 7,029 | 25,960 | |||||||||
Interest expense | (5,594 | ) | (223 | ) | (5,817 | ) | ||||||
Net interest income before fees and related income on earning assets and provision for losses on loans and fees receivable | $ | 13,337 | $ | 6,806 | $ | 20,143 | ||||||
Fees and related income on earning assets | $ | 2,779 | $ | 22 | $ | 2,801 | ||||||
Servicing income | $ | 857 | $ | 232 | $ | 1,089 | ||||||
Depreciation of rental merchandise | $ | (27 | ) | $ | — | $ | (27 | ) | ||||
Equity in income of equity-method investee | $ | 334 | $ | — | $ | 334 | ||||||
(Loss) income before income taxes | $ | (387 | ) | $ | 1,732 | $ | 1,345 | |||||
Income tax expense | $ | (33 | ) | $ | (585 | ) | $ | (618 | ) | |||
Total assets | $ | 306,721 | $ | 64,402 | $ | 371,123 |
4. | Shareholders’ Equity |
5. | Investment in Equity-Method Investee |
As of | |||||||
March 31, 2018 | December 31, 2017 | ||||||
Loans and fees receivable, at fair value | $ | 5,088 | $ | 6,123 | |||
Total assets | $ | 5,366 | $ | 6,392 | |||
Total liabilities | $ | 24 | $ | 26 | |||
Members’ capital | $ | 5,342 | $ | 6,366 |
Three months ended March 31, | |||||||
2018 | 2017 | ||||||
Net interest income, fees and related income on earning assets | $ | 14 | $ | 504 | |||
Net (loss) income | $ | (61 | ) | $ | 397 | ||
Net income attributable to our equity investment in investee | $ | 9 | $ | 334 |
6. | Fair Values of Assets and Liabilities |
Assets – As of March 31, 2018 (1) | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Carrying Amount of Assets | ||||||||||||
Loans and fees receivable, net for which it is practicable to estimate fair value | $ | — | $ | — | $ | 328,404 | $ | 306,307 | ||||||||
Loans and fees receivable, at fair value | $ | — | $ | — | $ | 9,413 | $ | 9,413 |
Assets – As of December 31, 2017 (1) | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Carrying Amount of Assets | ||||||||||||
Loans and fees receivable, net for which it is practicable to estimate fair value | $ | — | $ | — | $ | 324,945 | $ | 293,972 | ||||||||
Loans and fees receivable, at fair value | $ | — | $ | — | $ | 11,109 | $ | 11,109 |
(1) | For cash, deposits and other short-term investments, the carrying amount is a reasonable estimate of fair value. |
Loans and Fees Receivable, at Fair Value | |||||||
2018 | 2017 | ||||||
Balance at January 1, | $ | 11,109 | $ | 15,648 | |||
Total gains—realized/unrealized: | |||||||
Net revaluations of loans and fees receivable, at fair value | (18 | ) | 563 | ||||
Settlements | (1,691 | ) | (2,626 | ) | |||
Impact of foreign currency translation | 13 | 6 | |||||
Balance at March 31, | $ | 9,413 | $ | 13,591 |
Quantitative Information about Level 3 Fair Value Measurements | ||||||||||
Fair Value Measurements | Fair Value at March 31, 2018 | Valuation Technique | Unobservable Input | Range (Weighted Average) | ||||||
Loans and fees receivable, at fair value | $ | 9,413 | Discounted cash flows | Gross yield | 16.3% to 27.9% (25.8%) | |||||
Principal payment rate | 1.2% to 3.1% (2.4%) | |||||||||
Expected credit loss rate | 9.0% to 13.4% (12.3%) | |||||||||
Servicing rate | 12.0% to 14.8% (12.3%) | |||||||||
Discount rate | 6.0% to 14.4% (12.9%) |
Quantitative Information about Level 3 Fair Value Measurements | ||||||||||
Fair Value Measurements | Fair Value at December 31, 2017 | Valuation Technique | Unobservable Input | Range (Weighted Average) | ||||||
Loans and fees receivable, at fair value | $ | 11,109 | Discounted cash flows | Gross yield | 15.8% to 27.4% (24.5%) | |||||
Principal payment rate | 1.9% to 3.6% (2.6%) | |||||||||
Expected credit loss rate | 9.4% to 10.4% (9.7%) | |||||||||
Servicing rate | 10.2% to 12.3% (10.5%) | |||||||||
Discount rate | 6.0% to 14.2% (12.8%) |
Liabilities – As of March 31, 2018 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Carrying Amount of Liabilities | ||||||||||||
Liabilities not carried at fair value | ||||||||||||||||
Revolving credit facilities | $ | — | $ | — | $ | 183,388 | $ | 183,388 | ||||||||
Amortizing debt facilities | $ | — | $ | — | $ | 58,742 | $ | 58,742 | ||||||||
Senior secured term loan | $ | — | $ | — | $ | 40,000 | $ | 40,000 | ||||||||
5.875% convertible senior notes | $ | — | $ | 43,588 | $ | — | $ | 61,650 | ||||||||
Liabilities carried at fair value | ||||||||||||||||
Notes payable associated with structured financings, at fair value | $ | — | $ | — | $ | 7,909 | $ | 7,909 |
Liabilities - As of December 31, 2017 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Carrying Amount of Liabilities | ||||||||||||
Liabilities not carried at fair value | ||||||||||||||||
Revolving credit facilities | $ | — | $ | — | $ | 160,854 | $ | 160,854 | ||||||||
Amortizing debt facilities | $ | — | $ | — | $ | 65,384 | $ | 65,384 | ||||||||
Senior secured term loan | $ | — | $ | — | $ | 40,000 | $ | 40,000 | ||||||||
5.875% convertible senior notes | $ | — | $ | 43,588 | $ | — | $ | 61,393 | ||||||||
Liabilities carried at fair value | ||||||||||||||||
Notes payable associated with structured financings, at fair value | $ | — | $ | — | $ | 9,240 | $ | 9,240 |
Notes Payable Associated with Structured Financings, at Fair Value | |||||||
2018 | 2017 | ||||||
Beginning balance, January 1, | $ | 9,240 | $ | 12,276 | |||
Total (gains) losses—realized/unrealized: | |||||||
Net revaluations of notes payable associated with structured financings, at fair value | (1,331 | ) | (706 | ) | |||
Repayments on outstanding notes payable, net | — | (439 | ) | ||||
Ending balance, March 31, | $ | 7,909 | $ | 11,131 |
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||
Fair Value Measurements | Fair Value at March 31, 2018 | Valuation Technique | Unobservable Input | Weighted Average | |||||||
Notes payable associated with structured financings, at fair value | $ | 7,909 | Discounted cash flows | Gross yield | 27.9 | % | |||||
Principal payment rate | 2.6 | % | |||||||||
Expected credit loss rate | 13.4 | % | |||||||||
Discount rate | 14.4 | % |
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||
Fair Value Measurements | Fair Value at December 31, 2017 | Valuation Technique | Unobservable Input | Weighted Average | |||||||
Notes payable associated with structured financings, at fair value | $ | 9,240 | Discounted cash flows | Gross yield | 25.9 | % | |||||
Principal payment rate | 2.5 | % | |||||||||
Expected credit loss rate | 9.4 | % | |||||||||
Discount rate | 14.2 | % |
As of March 31, 2018 | Loans and Fees Receivable at Fair Value | Loans and Fees Receivable Pledged as Collateral under Structured Financings at Fair Value | ||||||
Aggregate unpaid principal balance within loans and fees receivable that are reported at fair value | $ | 4,088 | $ | 10,222 | ||||
Aggregate fair value of loans and fees receivable that are reported at fair value | $ | 1,504 | $ | 7,909 | ||||
Aggregate fair value of receivables carried at fair value that are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) | $ | 2 | $ | 12 | ||||
Aggregate excess of balance of unpaid principal receivables within loans and fees receivable that are reported at fair value and are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) over the fair value of such loans and fees receivable | $ | 85 | $ | 303 |
As of December 31, 2017 | Loans and Fees Receivable at Fair Value | Loans and Fees Receivable Pledged as Collateral under Structured Financings at Fair Value | ||||||
Aggregate unpaid principal balance within loans and fees receivable that are reported at fair value | $ | 4,416 | $ | 11,349 | ||||
Aggregate fair value of loans and fees receivable that are reported at fair value | $ | 1,869 | $ | 9,240 | ||||
Aggregate fair value of receivables carried at fair value that are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) | $ | 5 | $ | 17 | ||||
Aggregate excess of balance of unpaid principal receivables within loans and fees receivable that are reported at fair value and are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) over the fair value of such loans and fees receivable | $ | 107 | $ | 369 |
Notes Payable | Notes Payable Associated with Structured Financings, at Fair Value as of March 31, 2018 | Notes Payable Associated with Structured Financings, at Fair Value as of December 31, 2017 | ||||||
Aggregate unpaid principal balance of notes payable | $ | 101,314 | $ | 101,314 | ||||
Aggregate fair value of notes payable | $ | 7,909 | $ | 9,240 |
7. | Notes Payable |
Carrying Amounts at Fair Value as of | |||||||
March 31, 2018 | December 31, 2017 | ||||||
Amortizing securitization facility (stated maturity of December 2021), outstanding face amount of $101.3 million as of March 31, 2018 ($101.3 million as of December 31, 2017) bearing interest at a weighted average 7.0% interest rate at March 31, 2018 (6.7% at December 31, 2017), which is secured by credit card receivables and restricted cash aggregating $7.9 million as of March 31, 2018 ($9.2 million as of December 31, 2017) in carrying amount | $ | 7.9 | $ | 9.2 |
As of | |||||||
March 31, 2018 | December 31, 2017 | ||||||
Revolving credit facilities at a weighted average interest rate equal to 8.3% at March 31, 2018 (7.8% at December 31, 2017) secured by the financial and operating assets of CAR and/or certain receivables and restricted cash with a combined aggregate carrying amount of $243.0 million as of March 31, 2018 ($216.0 million at December 31, 2017) | |||||||
Revolving credit facility, not to exceed $40.0 million (expiring November 1, 2019) (1) | 24.6 | 24.8 | |||||
Revolving credit facility, not to exceed $50.0 million (expiring October 30, 2019) (2) (3) | 49.2 | 49.4 | |||||
Revolving credit facility, not to exceed $12.0 million (expiring December 21, 2019) (2) (3) | 11.8 | 3.8 | |||||
Revolving credit facility, not to exceed $20.0 million (expiring December 31, 2019) (2) (3) | 19.7 | 19.8 | |||||
Revolving credit facility, not to exceed $90.0 million (expiring February 8, 2022) (2) (4) | 80.0 | 65.0 | |||||
Amortizing facilities at a weighted average interest rate equal to 6.3% at March 31, 2018 (6.0% at December 31, 2017) secured by certain receivables and restricted cash with a combined aggregate carrying amount of $73.1 million as of March 31, 2018 ($77.9 million as of December 31, 2017) | |||||||
Amortizing debt facility (repaid March 31, 2018) (2) (3) (5) | — | 3.7 | |||||
Amortizing debt facility (expiring June 30, 2018) (2) (3) (5) | 9.2 | 18.3 | |||||
Amortizing debt facility (expiring December 12, 2018) (2) (3) | 4.0 | 6.0 | |||||
Amortizing debt facility (expiring September 14, 2018) (2) (3) | 5.0 | 7.5 | |||||
Amortizing debt facility (expiring November 30, 2018) (2) (3) (5) | 14.9 | 20.5 | |||||
Amortizing debt facility (expiring April 22, 2019) (2) (3) (5) | 26.1 | 10.0 | |||||
Other facilities | |||||||
Senior secured term loan from related parties (expiring November 21, 2018) that is secured by certain assets of the Company with an annual interest rate equal to 9.0% (4) | 40.0 | 40.0 | |||||
Total notes payable before unamortized debt issuance costs and discounts | 284.5 | 268.8 | |||||
Unamortized debt issuance costs and discounts | 2.4 | 2.6 | |||||
Total notes payable outstanding, net | $ | 282.1 | $ | 266.2 |
(1) | Loan is subject to certain affirmative covenants, including a coverage ratio, a leverage ratio and a collateral performance test, the failure of which could result in required early repayment of all or a portion of the outstanding balance by our CAR Auto Finance operations. |
(2) | Loans are subject to certain affirmative covenants tied to default rates and other performance metrics the failure of which could result in required early repayment of the remaining unamortized balances of the notes. |
(3) | These notes reflect modifications to either extend the maturity date, increase the loaned amount or both. |
(4) | See below for additional information. |
(5) | Loans are comprised of four tranches with the same lenders. Terms and conditions are substantially identical with the exception of maturity date as indicated in the table above. |
8. | Convertible Senior Notes |
As of | |||||||
March 31, 2018 | December 31, 2017 | ||||||
Face amount of 5.875% convertible senior notes | $ | 88,280 | $ | 88,280 | |||
Discount | (26,630 | ) | (26,887 | ) | |||
Net carrying value | $ | 61,650 | $ | 61,393 | |||
Carrying amount of equity component included in additional paid-in capital | $ | 108,714 | $ | 108,714 | |||
Excess of instruments’ if-converted values over face principal amounts | $ | — | $ | — |
9. | Commitments and Contingencies |
10. | Net (Loss) Income Attributable to Controlling Interests Per Common Share |
For the Three Months Ended March 31, | ||||||||
2018 | 2017 | |||||||
Numerator: | ||||||||
Net (loss) income attributable to controlling interests | $ | (4,670 | ) | $ | 728 | |||
Denominator: | ||||||||
Basic (including unvested share-based payment awards) (1) | 13,899 | 13,944 | ||||||
Effect of dilutive stock compensation arrangements (2) | — | 33 | ||||||
Diluted (including unvested share-based payment awards) (1) | 13,899 | 13,977 | ||||||
Net (loss) income attributable to controlling interests per common share—basic | $ | (0.34 | ) | $ | 0.05 | |||
Net (loss) income attributable to controlling interests per common share—diluted | $ | (0.34 | ) | $ | 0.05 |
(1) | Shares related to unvested share-based payment awards included in our basic and diluted share counts were 184,196 for the three months ended March 31, 2018, compared to 345,385 for the three months ended March 31, 2017. |
(2) | The effect of dilutive stock compensation arrangements is shown only for informational purposes where we are in a net loss position. In such situations, the effect of including outstanding options and restricted stock would be anti-dilutive, and they are thus excluded from all loss period calculations. |
11. | Stock-Based Compensation |
March 31, 2018 | ||||||||||||
Number of Shares | Weighted- Average Exercise Price | Weighted- Average of Remaining Contractual Life (in years) | Aggregate Intrinsic Value | |||||||||
Outstanding at December 31, 2017 | 2,619,334 | $ | 3.04 | |||||||||
Issued | — | $ | — | |||||||||
Exercised | — | $ | — | |||||||||
Cancelled/Forfeited | (4,667 | ) | $ | 3.04 | ||||||||
Outstanding at March 31, 2018 | 2,614,667 | $ | 3.04 | 3.1 | $ | — | ||||||
Exercisable at March 31, 2018 | 1,010,815 | $ | 2.95 | 2.1 | $ | — |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Income | |||||||||||
For the Three Months Ended March 31, | Increases (Decreases) | ||||||||||
(In Thousands) | 2018 | 2017 | from 2017 to 2018 | ||||||||
Total interest income | $ | 35,726 | $ | 25,960 | $ | 9,766 | |||||
Interest expense | (8,153 | ) | (5,817 | ) | (2,336 | ) | |||||
Fees and related income on earning assets: | |||||||||||
Fees on credit products | 4,905 | 1,096 | 3,809 | ||||||||
Changes in fair value of loans and fees receivable recorded at fair value | (18 | ) | 563 | (581 | ) | ||||||
Changes in fair value of notes payable associated with structured financings recorded at fair value | 1,331 | 706 | 625 | ||||||||
Rental revenue | — | 148 | (148 | ) | |||||||
Other | (4 | ) | 288 | (292 | ) | ||||||
Other operating income: | |||||||||||
Servicing income | 632 | 1,089 | (457 | ) | |||||||
Other income | 516 | 109 | 407 | ||||||||
Equity in income equity-method investee | 9 | 334 | (325 | ) | |||||||
Total | $ | 34,944 | $ | 24,476 | $ | 10,468 | |||||
Net losses upon (recovery of) charge off of loans and fees receivable recorded at fair value | 1,791 | (7,851 | ) | (9,642 | ) | ||||||
Provision for losses on loans and fees receivable recorded at net realizable value | 15,991 | 10,653 | (5,338 | ) | |||||||
Other operating expenses: | |||||||||||
Salaries and benefits | 6,298 | 5,780 | (518 | ) | |||||||
Card and loan servicing | 9,164 | 7,137 | (2,027 | ) | |||||||
Marketing and solicitation | 2,346 | 2,201 | (145 | ) | |||||||
Depreciation, primarily related to rental merchandise | 229 | 310 | 81 | ||||||||
Other | 3,700 | 4,901 | 1,201 | ||||||||
Net (loss) income | (4,719 | ) | 727 | (5,446 | ) | ||||||
Net loss attributable to noncontrolling interests | 49 | 1 | 48 | ||||||||
Net (loss) income attributable to controlling interests | (4,670 | ) | 728 | (5,398 | ) |
• | increases in fees on credit products, primarily associated with growth in direct-to-consumer products and to a lesser degree by growth in point-of-sale finance products, offset somewhat by general net declines in historical credit card receivables; and |
• | the effects of changes in the fair values of credit card receivables recorded at fair value and notes payable associated with structured financings recorded at fair value as described below. |
• | increases in card and loan servicing expenses in the three months ended March 31, 2018 when compared to the three months ended March 31, 2017 due to growth in receivables associated with our investments in point-of-sale and direct-to-consumer receivables which grew from $225.6 million outstanding to $322.3 million outstanding at March 31, 2017 and March 31, 2018, respectively, offset by the continued net liquidations in our historical credit card portfolios, the receivables of which declined from $21.9 million outstanding to $15.6 million outstanding at March 31, 2017 and March 31, 2018, respectively; |
• | slight increases in marketing and solicitation costs for the three months ended March 31, 2018 primarily due to volume-related increases in costs attributable to the growth in our retail point-of-sale and direct-to-consumer portfolios. We expect that increased origination and brand marketing support will result in overall increases in year-over-year costs during 2018 although the frequency and timing of marketing efforts could result in reductions in quarter-over-quarter marketing costs; and |
• | declines in other expenses primarily related to realized translation gains and losses recognized during both periods. |
At or for the Three Months Ended | |||||||||||||||
2018 | 2017 | 2016 | |||||||||||||
Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | ||||||||
Loans and fees receivable, gross | 15,557 | 16,601 | 18,180 | 20,102 | 21,922 | 24,229 | 28,313 | 28,514 | |||||||
Fair value adjustment | (6,144) | (5,492) | (6,161) | (7,332) | (8,331) | (8,581) | (9,868) | (7,994) | |||||||
Loans and fees receivable, at fair value | 9,413 | 11,109 | 12,019 | 12,770 | 13,591 | 15,648 | 18,445 | 20,520 |
At or for the Three Months Ended | |||||||||||||||||||||||
2018 | 2017 | 2016 | |||||||||||||||||||||
Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | ||||||||||||||||
Period-end managed receivables | $337,848 | $333,286 | $303,080 | $267,637 | $247,569 | $238,493 | $219,016 | $193,253 | |||||||||||||||
Percent 30 or more days past due | 12.1 | % | 13.7 | % | 12.1 | % | 11.5 | % | 11.5 | % | 12.7 | % | 11.7 | % | 8.9 | % | |||||||
Percent 60 or more days past due | 9.1 | % | 9.8 | % | 8.3 | % | 7.8 | % | 8.3 | % | 8.8 | % | 7.8 | % | 5.8 | % | |||||||
Percent 90 or more days past due | 6.5 | % | 6.5 | % | 5.5 | % | 4.9 | % | 5.5 | % | 5.5 | % | 4.9 | % | 3.7 | % | |||||||
Average managed receivables | $335,567 | $318,183 | $285,359 | $257,603 | $243,031 | $228,755 | $206,135 | $169,503 | |||||||||||||||
Total yield ratio | 41.0 | % | 39.5 | % | 36.5 | % | 35.1 | % | 34.8 | % | 33.4 | % | 35.6 | % | 35.8 | % | |||||||
Combined gross charge-off ratio | 24.2 | % | 20.1 | % | 18.2 | % | 21.1 | % | 22.4 | % | 20.1 | % | 12.6 | % | 13.9 | % |
Retail - At or for the Three Months Ended | |||||||||||||||
2018 | 2017 | 2016 | |||||||||||||
Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | ||||||||
Period-end managed receivables | $207,231 | $206,877 | $193,403 | $180,830 | 161,876 | $141,261 | $110,542 | $89,836 | |||||||
Percent 30 or more days past due | 12.6% | 14.0% | 14.0% | 12.3% | 11.8% | 13.4% | 13.8% | 12.6% | |||||||
Percent 60 or more days past due | 9.4% | 10.1% | 9.9% | 8.4% | 8.6% | 9.6% | 9.5% | 8.3% | |||||||
Percent 90 or more days past due | 6.8% | 7.2% | 6.9% | 5.6% | 6.1% | 6.4% | 6.5% | 5.4% | |||||||
Average APR | 24.2% | 24.2% | 26.7% | 26.7% | 26.5% | 26.3% | 25.5% | 25% | |||||||
Receivables purchased during period | $60,932 | $64,036 | $59,293 | $65,786 | $64,617 | $60,118 | $44,871 | $35,478 |
Direct - At or for the Three Months Ended | |||||||||||||||
2018 | 2017 | 2016 | |||||||||||||
Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | ||||||||
Period-end managed receivables | $115,060 | $109,808 | $91,497 | $66,705 | $63,771 | $73,003 | $80,161 | $74,903 | |||||||
Percent 30 or more days past due | 12.2% | 12.9% | 8.3% | 9.3% | 10.8% | 10.8% | 7.9% | 3.5% | |||||||
Percent 60 or more days past due | 9.2% | 9.1% | 5.0% | 6.2% | 7.4% | 6.9% | 4.9% | 2.0% | |||||||
Percent 90 or more days past due | 6.4% | 5.3% | 2.7% | 3.4% | 3.8% | 3.6% | 2.3% | 1.1% | |||||||
Average APR | 26.9% | 27.5% | 28.5% | 28.0% | 27.8% | 28.3% | 29.2% | 30.1% | |||||||
Receivables purchased during period | $33,747 | $38,338 | $38,005 | $15,051 | $5,782 | $5,602 | $15,852 | $45,562 |
At or for the Three Months Ended | |||||||||||||||||||||||||||||||
2018 | 2017 | 2016 | |||||||||||||||||||||||||||||
Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | Mar. 31 | Dec. 31 | Sept. 30 | Jun. 30 | ||||||||||||||||||||||||
Period-end managed receivables | $ | 78,436 | $ | 77,213 | $ | 74,923 | $ | 76,387 | $ | 72,121 | $ | 76,433 | $ | 73,624 | $ | 78,010 | |||||||||||||||
Percent 30 or more days past due | 8.8 | % | 12.8 | % | 13.0 | % | 11.7 | % | 10.0 | % | 14.2 | % | 12.7 | % | 12.3 | % | |||||||||||||||
Percent 60 or more days past due | 3.3 | % | 5.0 | % | 5.0 | % | 4.0 | % | 4.2 | % | 5.4 | % | 4.5 | % | 3.9 | % | |||||||||||||||
Percent 90 or more days past due | 1.6 | % | 2.4 | % | 2.2 | % | 1.4 | % | 2.1 | % | 2.4 | % | 1.8 | % | 1.5 | % | |||||||||||||||
Average managed receivables | $ | 77,825 | $ | 76,068 | $ | 75,655 | $ | 74,254 | $ | 74,278 | $ | 75,029 | $ | 75,817 | $ | 76,878 | |||||||||||||||
Total yield ratio | 37.9 | % | 37.9 | % | 38.8 | % | 39.2 | % | 39.3 | % | 39.5 | % | 40.3 | % | 39.6 | % | |||||||||||||||
Combined gross charge-off ratio | 2.1 | % | 3.0 | % | 1.1 | % | 2.5 | % | 2.5 | % | 2.8 | % | 2.9 | % | 3.2 | % | |||||||||||||||
Recovery ratio | 1.5 | % | 1.5 | % | 1.7 | % | 2.0 | % | 1.6 | % | 1.6 | % | 1.1 | % | 1.6 | % |
Revolving credit facility (expiring October 30, 2019) that is secured by certain receivables and restricted cash | $ | 49.2 | |
Revolving credit facility (expiring November 1, 2019) that is secured by the financial and operating assets of our CAR operations | 24.6 | ||
Revolving credit facility (expiring December 31, 2019) that is secured by certain receivables and restricted cash | 19.7 | ||
Revolving credit facility (expiring December 21, 2019) that is secured by certain receivables and restricted cash | 11.8 | ||
Senior secured term loan from related parties (expiring November 21, 2018) that is secured by certain assets of the Company with an annual interest rate equal to 9.0% | 40.0 | ||
Total | $ | 145.3 |
• | During the three months ended March 31, 2018, we used $10.2 million of cash flows from operations compared to the generation of $2.4 million of cash flows from operations during the three months ended March 31, 2017. The |
• | During the three months ended March 31, 2018, we used $8.9 million of cash from our investing activities, compared to use of $4.0 million of cash from investing activities during the three months ended March 31, 2017. This increase is primarily due to: 1) the shrinking size of our historical credit card receivables, resulting in lower corresponding payments from consumers; and 2) increasing levels of investments for 2018 in the point-of-sale and direct-to-consumer receivables relative to the same period in 2017 and which we expect to continue to make throughout 2018. Slightly offsetting this increase in cash used by investing activities are returns on our aforementioned investments in point-of-sale and direct-to-consumer receivables which contributed positively to our cash generated from investing activities. |
• | During the three months ended March 31, 2018, we generated $15.5 million of cash in financing activities, compared to our generating $3.5 million of cash in financing activities during the three months ended March 31, 2017. In both periods, the data reflect borrowings associated with point-of-sale and direct-to-consumer receivables offset by net repayments of amortizing debt facilities as payments are made on the underlying receivables that serve as collateral. |
• | the availability of adequate financing to support growth; |
• | the extent to which federal, state, local and foreign governmental regulation of our various business lines and the products we service for others limits or prohibits the operation of our businesses; |
• | current and future litigation and regulatory proceedings against us; |
• | the effect of adverse economic conditions on our revenues, loss rates and cash flows; |
• | competition from various sources providing similar financial products, or other alternative sources of credit, to consumers; |
• | the adequacy of our allowances for uncollectible loans and fees receivable and estimates of loan losses used within our risk management and analyses; |
• | the possible impairment of assets; |
• | our ability to manage costs in line with the expansion or contraction of our various business lines; |
• | our relationship with (i) the merchants that participate in point-of-sale finance operations and (ii) the banks that issue credit cards and provide certain other credit products utilizing our technology platform and related services; and |
• | theft and employee errors. |
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
• | the availability of funding on favorable terms; |
• | our relationships with the banks that issue credit cards; |
• | the degree to which we lose business to competitors; |
• | the level of usage of our credit card products by consumers; |
• | the availability of portfolios for purchase on attractive terms; |
• | levels of delinquencies and charge offs; |
• | the level of costs of acquiring new receivables; |
• | our ability to employ and train new personnel; |
• | our ability to maintain adequate management systems, collection procedures, internal controls and automated systems; and |
• | general economic and other factors beyond our control. |
• | receivables not originated in compliance with law (or revised interpretations) could become unenforceable and uncollectible under their terms against the obligors; |
• | we may be required to credit or refund previously collected amounts; |
• | certain fees and finance charges could be limited, prohibited or restricted, which would reduce the profitability of certain investments in receivables; |
• | certain collection methods could be prohibited, forcing us to revise our practices or adopt more costly or less effective practices; |
• | limitations on our ability to recover on charged-off receivables regardless of any act or omission on our part; |
• | some credit products and services could be banned in certain states or at the federal level; |
• | federal or state bankruptcy or debtor relief laws could offer additional protections to consumers seeking bankruptcy protection, providing a court greater leeway to reduce or discharge amounts owed to us; and |
• | a reduction in our ability or willingness to invest in receivables arising under loans to certain consumers, such as military personnel. |
• | actual or anticipated fluctuations in our operating results; |
• | changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors; |
• | the overall financing environment, which is critical to our value; |
• | the operating and stock performance of our competitors; |
• | announcements by us or our competitors of new products or services or significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments; |
• | changes in interest rates; |
• | the announcement of enforcement actions or investigations against us or our competitors or other negative publicity relating to us or our industry; |
• | changes in GAAP, laws, regulations or the interpretations thereof that affect our various business activities and segments; |
• | general domestic or international economic, market and political conditions; |
• | changes in ownership by executive officers, directors and parties related to them who control a majority of our common stock; |
• | additions or departures of key personnel; and |
• | future sales of our common stock and the transfer or cancellation of shares of common stock pursuant to a share lending agreement. |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased under the Plans or Programs (1)(2) | |||||||||
January 1- January 31 | 826 | $ | 2.36 | 826 | 4,826,775 | |||||||
February 1 - February 28 | — | $ | — | — | 4,826,775 | |||||||
March 1 - March 31 | 6,180 | $ | 2.00 | — | 4,826,775 | |||||||
Total | 7,006 | $ | 2.04 | 826 | 4,826,775 |
(1) | Because withholding tax-related stock repurchases are permitted outside the scope of our 5,000,000 share Board-authorized repurchase plan, these amounts exclude shares of stock returned to us by employees in satisfaction of withholding tax requirements on vested stock grants. There were 6,180 such shares returned to us during the three months ended March 31, 2018. |
(2) | Pursuant to a share repurchase plan authorized by our Board of Directors on May 10, 2018, we are authorized to repurchase 5,000,000 shares of our common stock through June 30, 2020. |
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. | MINE SAFETY DISCLOSURES |
ITEM 5. | OTHER INFORMATION |
ITEM 6. | EXHIBITS |
Exhibit Number | Description of Exhibit | Incorporated by Reference from Atlanticus’ SEC Filings Unless Otherwise Indicated | ||
10.1 | Second Amended and Restated Employee Stock Purchase Plan | |||
31.1 | Certification of Principal Executive Officer pursuant to Rule 13a-14(a) | |||
31.2 | Certification of Principal Financial Officer pursuant to Rule 13a-14(a) | |||
32.1 | Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350 | |||
101.INS | XBRL Instance Document | Filed herewith | ||
101.SCH | XBRL Taxonomy Extension Schema Document | Filed herewith | ||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | Filed herewith | ||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | Filed herewith | ||
101.PRE | XBRL Taxonomy Presentation Linkbase Document | Filed herewith | ||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | Filed herewith |
ATLANTICUS HOLDINGS CORPORATION | ||||
May 15, 2018 | By | /s/ WILLIAM R. McCAMEY | ||
William R. McCamey | ||||
Chief Financial Officer | ||||
(duly authorized officer and principal financial officer) |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the fourth fiscal period in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ DAVID G. HANNA | |
David G. Hanna | |
Chief Executive Officer and Chairman of the Board |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the fourth fiscal period in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/s/ WILLIAM R. McCAMEY | |
William R. McCamey | |
Chief Financial Officer |
/s/ DAVID G. HANNA | |
David G. Hanna | |
Chief Executive Officer and | |
Chairman of the Board | |
/s/ WILLIAM R. McCAMEY | |
William R. McCamey | |
Chief Financial Officer |
Document and Entity Information - USD ($) |
3 Months Ended | ||
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Mar. 31, 2018 |
May 09, 2018 |
Jun. 30, 2017 |
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Document and Entity Information [Abstract] | |||
Trading Symbol | ATLC | ||
Entity Registrant Name | Atlanticus Holdings Corp | ||
Entity Central Index Key | 0001464343 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 15,349,923 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | Q1 | ||
Document Type | 10-Q | ||
Amendment Flag | false | ||
Document Period End Date | Mar. 31, 2018 | ||
Entity Public Float | $ 14,443,220 |
Consolidated Balance Sheets (Parenthetical) - $ / shares |
Mar. 31, 2018 |
Dec. 31, 2017 |
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Equity | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 15,353,878 | 15,291,884 |
Common stock, shares outstanding | 15,353,878 | 15,291,884 |
Own-share Lending Arrangement, Shares, Outstanding | 1,459,233 | 1,459,233 |
Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | |
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Mar. 31, 2018 |
Mar. 31, 2017 |
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Other comprehensive loss: | ||
Net (loss) income | $ (4,719) | $ 727 |
Foreign currency translation adjustment | (2,345) | 0 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | 0 | 0 |
Income tax benefit related to other comprehensive loss | 0 | 0 |
Comprehensive (loss) income | (7,064) | 727 |
Comprehensive loss attributable to noncontrolling interests | 49 | 1 |
Comprehensive (loss) income attributable to controlling interests | $ (7,015) | $ 728 |
Description of Our Business |
3 Months Ended |
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Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Our Business | Description of Our Business Our accompanying consolidated financial statements include the accounts of Atlanticus Holdings Corporation (the “Company”) and those entities we control. We are primarily focused on providing financial technology and related services. Through our subsidiaries, we provide technology and other support services to lenders who offer an array of financial products and services to consumers who may have been declined under traditional financing options. In most cases, we invest in the receivables originated by lenders who utilize our technology platform and other related services. As discussed further below, we reflect our business lines within two reportable segments: Credit and Other Investments; and Auto Finance. See also Note 3, “Segment Reporting,” for further details. Within our Credit and Other Investments segment, we facilitate consumer finance programs offered by our bank partners to originate consumer loans through multiple channels, including retail point-of-sale, direct mail solicitation, on-line and partnerships. In the retail credit (the “point-of-sale” operations) channel, we partner with retailers and service providers in various industries across the United States (“U.S.”) to enable them to provide credit to their customers for the purchase of goods and services. These services of our lending partners are often extended to consumers who may have been declined under traditional financing options. We specialize in supporting this “second look” credit service in various industries across the U.S. Additionally, we support lenders who market general purpose personal loans and credit cards directly to consumers (collectively, the “direct-to-consumer” operations) through additional channels enabling them to reach consumers through a diverse origination platform which includes direct mail, Internet-based marketing and through partnerships. Using our infrastructure and technology platform, we also provide loan servicing, including risk management and customer service outsourcing, for third parties. Beyond these activities within our Credit and Other Investments segment, we continue to service portfolios of credit card receivables. One of our portfolios of credit card receivables is encumbered by non-recourse structured financing, and for this portfolio our principal remaining economic interest is the servicing compensation we receive as an offset against our servicing costs given that the likely future collections on the portfolio are insufficient to allow for full repayment of the financing. Additionally, we report within our Credit and Other Investments segment: 1) the income earned from an investment in an equity-method investee that holds credit card receivables for which we are the servicer; and 2) gains or losses associated with investments previously made in consumer finance technology platforms. These include investments in companies engaged in mobile technologies, marketplace lending and other financial technologies. These investments are carried at the lower of cost or market valuation. None of these companies are publicly-traded and there are no material pending liquidity events. Within our Auto Finance segment, our CAR subsidiary operations principally purchase and/or service loans secured by automobiles from or for, and also provide floor plan financing for, a pre-qualified network of independent automotive dealers and automotive finance companies in the buy-here, pay-here, used car business. We purchase auto loans at a discount and with dealer retentions or holdbacks that provide risk protection. Also within our Auto Finance segment, we are providing certain installment lending products in addition to our traditional loans secured by automobiles. |
Segment Reporting |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | Segment Reporting We operate primarily within one industry consisting of two reportable segments by which we manage our business. Our two reportable segments are: Credit and Other Investments, and Auto Finance. As of both March 31, 2018 and December 31, 2017, we did not have a material amount of long-lived assets located outside of the U.S., and only a negligible portion of our revenues for the three months ended March 31, 2018 and 2017 were generated outside of the U.S. We measure the profitability of our reportable segments based on their income after allocation of specific costs and corporate overhead; however, our segment results do not reflect any charges for internal capital allocations among our segments. Overhead costs are allocated based on headcounts and other applicable measures to better align costs with the associated revenues. Summary operating segment information (in thousands) is as follows:
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Shareholders' Equity |
3 Months Ended |
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Mar. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity During the three months ended March 31, 2018 and 2017, we repurchased and contemporaneously retired 7,006 and 6,702 shares of our common stock at an aggregate cost of $14,000 and $18,000, respectively, pursuant to both open market and private purchases and the return of stock by holders of equity incentive awards to pay tax withholding obligations. We had 1,459,233 loaned shares outstanding at March 31, 2018 and December 31, 2017, which were originally lent in connection with our November 2005 issuance of convertible senior notes. We retire lent shares as they are returned to us. |
Investments in Equity-Method Investees |
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Investments in Equity-Method Investees | Investment in Equity-Method Investee Our equity-method investment outstanding at March 31, 2018 consists of our 66.7% interest in a joint venture formed to purchase a credit card receivable portfolio. In the following tables, we summarize (in thousands) balance sheet and results of operations data for our equity-method investee:
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Fair Values of Assets and Liabilities |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Values of Assets and Liabilities | Fair Values of Assets and Liabilities Valuations and Techniques for Assets Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The table below summarizes (in thousands) by fair value hierarchy the March 31, 2018 and December 31, 2017 fair values and carrying amounts of (1) our assets that are required to be carried at fair value in our consolidated financial statements and (2) our assets not carried at fair value, but for which fair value disclosures are required:
For those asset classes above that are required to be carried at fair value in our consolidated financial statements, gains and losses associated with fair value changes are detailed on our fees and related income on earning assets table within Note 2, “Significant Accounting Policies and Consolidated Financial Statement Components.” For Level 3 assets carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) a reconciliation of the beginning and ending balances for the three months ended March 31, 2018 and 2017:
The unrealized gains and losses for assets within the Level 3 category presented in the tables above include changes in fair value that are attributable to both observable and unobservable inputs. Impacts related to foreign currency translation are included as a component of other operating expense on the consolidated statements of operations. Net Revaluation of Loans and Fees Receivable. We record the net revaluation of loans and fees receivable (including those pledged as collateral) in the fees and related income on earning assets category in our consolidated statements of operations, specifically as changes in fair value of loans and fees receivable recorded at fair value. The net revaluation of loans and fees receivable is based on the present value of future cash flows using a valuation model of expected cash flows and the estimated cost to service and collect those cash flows. We estimate the present value of these future cash flows using a valuation model consisting of internally developed estimates of assumptions third-party market participants would use in determining fair value, including estimates of net collected yield, principal payment rates, expected principal credit loss rates, costs of funds, discount rates and servicing costs. Accrued interest income on receivables underlying our asset classes that are carried at fair value in our consolidated financial statements is recorded in Interest income - Consumer loans, including past due fees in our Consolidated Statements of Operations. For Level 3 assets carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) quantitative information about the valuation techniques and the inputs used in the fair value measurement as of March 31, 2018 and December 31, 2017:
Valuations and Techniques for Liabilities Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the liability. The table below summarizes (in thousands) by fair value hierarchy the March 31, 2018 and December 31, 2017 fair values and carrying amounts of (1) our liabilities that are required to be carried at fair value in our consolidated financial statements and (2) our liabilities not carried at fair value, but for which fair value disclosures are required:
For our material Level 3 liabilities carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) a reconciliation of the beginning and ending balances for the three months ended March 31, 2018 and 2017.
The unrealized gains and losses for liabilities within the Level 3 category presented in the table above include changes in fair value that are attributable to both observable and unobservable inputs. We provide below a brief description of the valuation techniques used for Level 3 liabilities. Net Revaluation of Notes Payable Associated with Structured Financings, at Fair Value. We record the net revaluations of notes payable associated with structured financings, at fair value, in the changes in fair value of notes payable associated with structured financings line item within the fees and related income on earning assets category of our consolidated statements of operations. The net revaluation of these notes is based on the present value of future cash flows utilized in repayment of the outstanding principal and interest under the facilities using a valuation model of expected cash flows net of the contractual service expenses within the facilities. We estimate the present value of these future cash flows using a valuation model consisting of internally developed estimates of assumptions third-party market participants would use in determining fair value, including: estimates of net collected yield, principal payment rates and expected principal credit loss rates on the credit card receivables that secure the non-recourse notes payable; costs of funds; discount rates; and contractual servicing fees. Accrued interest expense on notes payable underlying our notes payable associated with structured financings, at fair value is recorded in Interest expense in our Consolidated Statements of Operations. For material Level 3 liabilities carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) quantitative information about the valuation techniques and the inputs used in the fair value measurement as of March 31, 2018 and December 31, 2017:
Other Relevant Data Other relevant data (in thousands) as of March 31, 2018 and December 31, 2017 concerning certain assets and liabilities we carry at fair value are as follows:
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Notes Payable |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes Payable | Notes Payable Notes Payable Associated with Structured Financings, at Fair Value Scheduled (in millions) in the table below are (1) the carrying amount of our structured financing note secured by certain credit card receivables and reported at fair value as of March 31, 2018 and December 31, 2017, (2) the outstanding face amount of our structured financing note secured by certain credit card receivables and reported at fair value as of March 31, 2018 and December 31, 2017, and (3) the carrying amount of the credit card receivables and restricted cash that provide the exclusive means of repayment for the note (i.e., lenders have recourse only to the specific credit card receivables and restricted cash underlying each respective facility and cannot look to our general credit for repayment) as of March 31, 2018 and December 31, 2017.
Contractual payment allocations within this credit card receivables structured financing provide for a priority distribution of cash flows to us to service the credit card receivables, a distribution of cash flows to pay interest and principal due on the notes, and a distribution of all excess cash flows (if any) to us. The structured financing facility included in the above table is amortizing down along with collections of the underlying receivables and there are no provisions within the debt agreement that allow for acceleration or bullet repayment of the facility prior to its scheduled expiration date. The aggregate carrying amount of the credit card receivables and restricted cash that provide security for the $7.9 million in fair value of the structured financing facility included in the above table is $7.9 million, which means that we have no aggregate exposure to pre-tax equity loss associated with the above structured financing arrangement at March 31, 2018. Beyond our role as servicer of the underlying assets within the credit cards receivables structured financing, we have provided no other financial or other support to the structure, and we have no explicit or implicit arrangements that could require us to provide financial support to the structure. Notes Payable, at Face Value and Notes Payable to Related Parties Other notes payable outstanding as of March 31, 2018 and December 31, 2017 that are secured by the financial and operating assets of either the borrower, another of our subsidiaries or both, include the following, scheduled (in millions); except as otherwise noted, the assets of our holding company (Atlanticus Holdings Corporation) are subject to creditor claims under these scheduled facilities:
On November 26, 2014, we and certain of our subsidiaries entered into a Loan and Security Agreement with Dove Ventures, LLC, a Nevada limited liability company (“Dove”). The agreement provides for a senior secured term loan facility in an amount of up to $40.0 million at any time outstanding. The Loan and Security Agreement was fully drawn with $40.0 million outstanding as of March 31, 2018. In November 2017, the agreement was amended to extend the maturity date of the term loan to November 21, 2018. All other terms remain unchanged. Our obligations under the agreement are guaranteed by certain subsidiary guarantors and secured by a pledge of certain assets of ours and the subsidiary guarantors. The loans bear interest at the rate of 9.0% per annum, payable monthly in arrears. The principal amount of these loans is payable in a single installment on November 21, 2018 (as amended). The agreement includes customary affirmative and negative covenants, as well as customary representations, warranties and events of default. Subject to certain conditions, we can prepay the principal amounts of these loans without premium or penalty. Dove is a limited liability company owned by three trusts. David G. Hanna is the sole shareholder and the President of the corporation that serves as the sole trustee of one of the trusts, and David G. Hanna and members of his immediate family are the beneficiaries of this trust. Frank J. Hanna, III is the sole shareholder and the President of the corporation that serves as the sole trustee of the other two trusts, and Frank J. Hanna, III and members of his immediate family are the beneficiaries of these other two trusts. In February 2017, we (through a wholly owned subsidiary) established a program under which we sell certain receivables to a consolidated trust in exchange for notes issued by the trust. The notes are secured by the receivables and other assets of the trust. Simultaneously with the establishment of the program, the trust issued a series of variable funding notes and sold an aggregate amount of up to $90.0 million (of which $80.0 million was outstanding as of March 31, 2018) to an unaffiliated third party pursuant to a facility that can be drawn upon to the extent of outstanding eligible receivables. Interest rates on the notes range from 8.0% to 14.0%. The facility matures on February 8, 2022 and is subject to certain affirmative covenants and collateral performance tests, the failure of which could result in required early repayment of all or a portion of the outstanding balance of notes. The facility also may be prepaid subject to payment of a prepayment fee. |
Convertible Senior Notes |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Convertible Senior Notes | Convertible Senior Notes In November 2005, we issued $300.0 million aggregate principal amount of 5.875% convertible senior notes due November 30, 2035 (“5.875% convertible senior notes”). The 5.875% convertible senior notes are unsecured, subordinate to existing and future secured obligations and structurally subordinate to existing and future claims of our subsidiaries’ creditors. These notes (net of repurchases since the issuance dates) are reflected within convertible senior notes on our consolidated balance sheets. No put rights exist under our 5.875% convertible senior notes. The following summarizes (in thousands) components of our consolidated balance sheets associated with our convertible senior notes:
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Commitments and Contingencies |
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Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies General Under finance products available in the point-of-sale and direct-to-consumer channels, consumers have the ability to borrow up to the maximum credit limit assigned to each individual’s account. Unfunded commitments under these products aggregated $453.4 million at March 31, 2018. We have never experienced a situation in which all borrowers have exercised their entire available lines of credit at any given point in time, nor do we anticipate this will ever occur in the future. Moreover, there would be a concurrent increase in assets should there be any exercise of these lines of credit. We also have the effective right to reduce or cancel these available lines of credit at any time. Additionally our CAR operations provide floor-plan financing for a pre-qualified network of independent automotive dealers and automotive finance companies in the buy-here, pay-here used car business. The financings allow dealers and finance companies to borrow up to the maximum pre-approved credit limit allowed in order to finance ongoing inventory needs. These loans are secured by the underlying auto inventory and, in certain cases where we have other lending products outstanding with the dealer, are secured by the collateral under those lending arrangements as well, including any outstanding dealer reserves. As of March 31, 2018, CAR had unfunded outstanding floor-plan financing commitments totaling $8.8 million. Each draw against unused commitments is reviewed for conformity to pre-established guidelines. Under agreements with third-party originating and other financial institutions, we have pledged security (collateral) related to their issuance of consumer credit and purchases thereunder, of which $8.7 million remains pledged as of March 31, 2018 to support various ongoing contractual obligations. Under agreements with third-party originating and other financial institutions, we have agreed to indemnify the financial institutions for certain liabilities associated with the services we provide on behalf of the financial institutions—such indemnification obligations generally being limited to instances in which we either (a) have been afforded the opportunity to defend against any potentially indemnifiable claims or (b) have reached agreement with the financial institutions regarding settlement of potentially indemnifiable claims. As of March 31, 2018, we have assessed the likelihood of any potential payments related to the aforementioned contingencies as remote. We will accrue liabilities related to these contingencies in any future period if and in which we assess the likelihood of an estimable payment as probable. We also are subject to certain minimum payments under cancelable and non-cancelable lease arrangements. For further information regarding these commitments, see Note 8, “Leases” to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017. Litigation See Note 11, “Commitments and Contingencies” to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2017 for information regarding outstanding litigation. Additionally, we are involved in various other legal proceedings that are incidental to the conduct of our business, none of which are expected to be material to us. |
Net Income (Loss) Attributable to Controlling Interests Per Common Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income (Loss) Attributable to Controlling Interests Per Common Share | Net (Loss) Income Attributable to Controlling Interests Per Common Share The following table sets forth the computations of net loss per common share (in thousands, except per share data):
For the three months ended March 31, 2018 and 2017, there were no shares potentially issuable and thus includible in the diluted net income attributable to controlling interests per common share calculations pursuant to our 5.875% convertible senior notes. However, in future reporting periods during which our closing stock price is above the $24.61 conversion price for the 5.875% convertible senior notes, and depending on the closing stock price at conversion, the maximum potential dilution under the conversion provisions of such notes is 3.6 million shares, which could be included in diluted share counts in net income per common share calculations. See Note 8, “Convertible Senior Notes,” for a further discussion of these convertible securities. |
Stock-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation |
We currently have two stock-based compensation plans, the Second Amended and Restated Employee Stock Purchase Plan (the “ESPP”) and the Second Amended and Restated 2014 Equity Incentive Plan (the “2014 Plan”). As of March 31, 2018, 103,702 shares remained available for issuance under the ESPP and 1,024,515 shares remained available for issuance under the 2014 Plan. Exercises and vestings under our stock-based compensation plans resulted in $0 in income tax-related charges to additional paid-in capital during the three months ended March 31, 2018 and 2017. Restricted Stock During the three months ended March 31, 2018 and 2017, we granted 69,000 and 57,000 shares of restricted stock (net of any forfeitures), respectively, with aggregate grant date fair values of $0.2 million and $0.2 million, respectively. We incurred expenses of $0.1 million and $0.2 million during the three months ended March 31, 2018 and 2017, respectively, related to restricted stock awards. When we grant restricted stock, we defer the grant date value of the restricted stock and amortize that value (net of the value of anticipated forfeitures) as compensation expense with an offsetting entry to the additional paid-in capital component of our consolidated shareholders’ equity. Our restricted stock awards typically vest over a range of 12 to 60 months (or other term as specified in the grant) and are amortized to salaries and benefits expense ratably over applicable vesting periods. As of March 31, 2018, our unamortized deferred compensation costs associated with non-vested restricted stock awards were $0.2 million with a weighted-average remaining amortization period of 0.4 years. Stock Options Our 2014 Plan provides that we may grant options on or shares of our common stock (and other types of equity awards) to members of our Board of Directors, employees, consultants and advisors. The exercise price per share of the options must be equal to or greater than the market price on the date the option is granted. The option period may not exceed 10 years from the date of grant. The vesting requirements for options are determined by the Compensation Committee of the Board of Directors. We had expense of $0.2 million and $0.3 million related to stock option-related compensation costs during the three months ended March 31, 2018 and 2017, respectively. When applicable, we recognize stock option-related compensation expense for any awards with graded vesting on a straight-line basis over the vesting period for the entire award. The table below includes additional information about outstanding options:
We had $0.7 million and $0.9 million of unamortized deferred compensation costs associated with non-vested stock options as of March 31, 2018 and December 31, 2017, respectively. |
Significant Accounting Policies and Consolidated Financial Statement Components (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans and Leases Receivable, Troubled Debt Restructuring Policy [Policy Text Block] | Troubled Debt Restructurings. As part of ongoing collection efforts, once an account in our Credit and Other Investments segment is 90 days or more past due, the account is placed on a non-accrual status. Placement on a non-accrual status results in the elimination of the annual percentage rate (“APR”) charged to an account and a cessation of fee billing. Following this adjustment, if a customer demonstrates a willingness and ability to resume making monthly payments and meets certain additional criteria, we will re-age the customer’s account. When we re-age an account, we adjust the status of the account to bring a delinquent account current, but generally do not make any further modifications to the payment terms or amount owed. Once an account is placed on a non-accrual status, it is closed for further purchases. Accounts that are placed on a non-accrual status and thereafter make at least one payment qualify as troubled debt restructurings (“TDRs”). The following table details by class of receivable, the number and amount of modified loans, including TDRs that have been re-aged, of March 31, 2018 and December 31, 2017:
*“TDRs - Performing” include accounts that are current on all amounts owed, while “TDRs - Nonperforming” include all accounts with past due amounts owed. Given that the above TDRs have a high reserve rate prior to modification as TDRs, we do not separately reserve or impair these receivables outside of our general reserve process. The following table details by class of receivable, the number of accounts and carrying value of loans that completed a modification (including those that were classified as TDRs) within the prior twelve months and subsequently charged off.
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Prepaid Expenses and Other Assets [Policy Text Block] | Prepaid Expenses and Other Assets Prepaid expenses and other assets include amounts paid to third parties for marketing and other services as well as amounts owed to us by third parties. Prepaid amounts are expensed as the underlying related services are performed. Also included are (1) commissions paid associated with our various office leases which we amortize into expense over the lease terms, (2) amounts due from a third party in respect of a servicing agreement totaling $31.6 million as of March 31, 2018, (3) ongoing deferred costs associated with service contracts and (4) investments in consumer finance technology platforms carried at the lower of cost or market valuation. |
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Accounts Payable and Accrued Liabilities Disclosure [Text Block] | Accounts Payable and Accrued Expenses Accounts payable and accrued expenses reflect both the billed and unbilled amounts owed at the end of a period for services rendered. Also included within accounts payable and accrued expenses are amounts which may be owed in respect of one of our portfolios. |
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Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates We prepare our consolidated financial statements in accordance with generally accepted accounting principles in the U.S. (“GAAP”). |
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Use of Estimates, Policy [Policy Text Block] | The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of our consolidated financial statements, as well as the reported amounts of revenues and expenses during each reporting period. We base these estimates on information available to us as of the date of the financial statements. Actual results could differ materially from these estimates. Certain estimates, such as credit losses, payment rates, costs of funds, discount rates and the yields earned on credit card receivables, significantly affect the reported amount of credit card receivables that we report at fair value and our notes payable associated with structured financings, at fair value; these estimates likewise affect the changes in these amounts reflected within our fees and related income on earning assets line item on our consolidated statements of operations. Additionally, estimates of future credit losses have a significant effect on loans and fees receivable, net, as shown on our consolidated balance sheets, as well as on the provision for losses on loans and fees receivable within our consolidated statements of operations. We have eliminated all significant intercompany balances and transactions for financial reporting purposes. |
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Loans and Fees Receivable | Loans and Fees Receivable Our loans and fees receivable include loans and fees receivable, at fair value and loans and fees receivable, gross. As of March 31, 2018 and December 31, 2017, the weighted average remaining accretion period for the $36.1 million and $37.0 million of deferred revenue reflected in the consolidated balance sheets was 12 months and 11 months, respectively. A roll-forward (in millions) of our allowance for uncollectible loans and fees receivable by class of receivable is as follows:
An aging of our delinquent loans and fees receivable, gross (in millions) by class of receivable as of March 31, 2018 and December 31, 2017 is as follows:
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Income Tax, Policy [Policy Text Block] | Income Taxes We experienced a negative effective income tax expense rate of 3.1% for the three months ended March 31, 2018, compared to an effective income tax expense rate of 45.9% for the three months ended March 31, 2017. Our negative effective income tax expense rate for the three months ended March 31, 2018, is below the statutory rate principally due to (1) interest we accrued during such period on unpaid federal tax liabilities and uncertain tax positions, (2) additions during such period to valuation allowances against our net federal deferred tax assets associated with our net loss incurred during such period, and (3) foreign tax expense incurred during such period. Our effective income tax expense rate for the three months ended March 31, 2017 was above the statutory rate applicable during such period principally due to interest we accrued during such period on unpaid federal tax liabilities. As implied above, we report income tax-related interest and penalties (including those associated with both our accrued liabilities for uncertain tax positions and unpaid tax liabilities) within our income tax benefit or expense line item on our consolidated statements of operations. We likewise report the reversal of income tax-related interest and penalties within such line item to the extent that we resolve our liabilities for uncertain tax positions or unpaid tax liabilities in a manner favorable to our accruals therefor. During both the three months ended March 31, 2018, and 2017, we included $0.2 million of net income tax-related interest and penalties within those periods’ respective income tax expense line items. In December 2014, we reached a settlement with the IRS concerning the tax treatment of net operating losses we incurred in 2007 and 2008 and carried back to obtain refunds of federal income taxes paid in earlier years dating back to 2003. Our net unpaid income tax assessment associated with that settlement was $7.4 million at March 31, 2018; this amount excludes unpaid interest and penalties on the tax assessment, the accruals for which aggregated $4.3 million at March 31, 2018. Prior to our filing amended return claims that would have eliminated the $7.4 million assessment (and corresponding interest and penalties) under a negotiated provision of the IRS settlement, the IRS filed a lien (as is customarily the case), associated with the assessment. Subsequently, an IRS examination team denied our amended return claims, and we filed a protest with IRS Appeals. Following correspondence and conferences we held with IRS Appeals, we received a settlement offer from IRS Appeals in April 2018 that would reduce our $7.4 million net unpaid income tax assessment referenced above to $3.7 million. We currently are evaluating the settlement offer, and should we accept the offer, (1) our $3.7 million reduction in the unpaid income tax assessment and liability accrued therefor would be reversed into income (along with a commensurate portion of the $4.3 million we have accrued for interest and penalties associated with the $3.7 million settled accrual), and (2) we would expect to pay the remaining accrued income tax, interest and penalties liability to the IRS after the settlement is finalized. |
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Revenue Recognition, Policy | Income Taxes We experienced a negative effective income tax expense rate of 3.1% for the three months ended March 31, 2018, compared to an effective income tax expense rate of 45.9% for the three months ended March 31, 2017. Our negative effective income tax expense rate for the three months ended March 31, 2018, is below the statutory rate principally due to (1) interest we accrued during such period on unpaid federal tax liabilities and uncertain tax positions, (2) additions during such period to valuation allowances against our net federal deferred tax assets associated with our net loss incurred during such period, and (3) foreign tax expense incurred during such period. Our effective income tax expense rate for the three months ended March 31, 2017 was above the statutory rate applicable during such period principally due to interest we accrued during such period on unpaid federal tax liabilities. As implied above, we report income tax-related interest and penalties (including those associated with both our accrued liabilities for uncertain tax positions and unpaid tax liabilities) within our income tax benefit or expense line item on our consolidated statements of operations. We likewise report the reversal of income tax-related interest and penalties within such line item to the extent that we resolve our liabilities for uncertain tax positions or unpaid tax liabilities in a manner favorable to our accruals therefor. During both the three months ended March 31, 2018, and 2017, we included $0.2 million of net income tax-related interest and penalties within those periods’ respective income tax expense line items. In December 2014, we reached a settlement with the IRS concerning the tax treatment of net operating losses we incurred in 2007 and 2008 and carried back to obtain refunds of federal income taxes paid in earlier years dating back to 2003. Our net unpaid income tax assessment associated with that settlement was $7.4 million at March 31, 2018; this amount excludes unpaid interest and penalties on the tax assessment, the accruals for which aggregated $4.3 million at March 31, 2018. Prior to our filing amended return claims that would have eliminated the $7.4 million assessment (and corresponding interest and penalties) under a negotiated provision of the IRS settlement, the IRS filed a lien (as is customarily the case), associated with the assessment. Subsequently, an IRS examination team denied our amended return claims, and we filed a protest with IRS Appeals. Following correspondence and conferences we held with IRS Appeals, we received a settlement offer from IRS Appeals in April 2018 that would reduce our $7.4 million net unpaid income tax assessment referenced above to $3.7 million. We currently are evaluating the settlement offer, and should we accept the offer, (1) our $3.7 million reduction in the unpaid income tax assessment and liability accrued therefor would be reversed into income (along with a commensurate portion of the $4.3 million we have accrued for interest and penalties associated with the $3.7 million settled accrual), and (2) we would expect to pay the remaining accrued income tax, interest and penalties liability to the IRS after the settlement is finalized. Revenue Recognition and Revenue from Contracts with Customers Consumer Loans, Including Past Due Fees Consumer loans, including past due fees reflect interest income, including finance charges, and late fees on loans in accordance with the terms of the related customer agreements. Premiums and discounts paid or received associated with a loan are generally deferred and amortized over the average life of the related loans using the effective interest method. Finance charges and fees, net of amounts that we consider uncollectible, are included in loans and fees receivable and revenue when the fees are earned. Fees and Related Income on Earning Assets Fees and related income on earning assets primarily include: (1) fees associated with our credit products, including the receivables underlying our U.S. point-of-sale finance and direct-to-consumer activities, and our historical credit card receivables; (2) changes in the fair value of loans and fees receivable recorded at fair value; (3) changes in fair value of notes payable associated with structured financings recorded at fair value; (4) revenues associated with rent payments on rental merchandise; and (5) gains or losses associated with our investments in securities. We assess fees on credit card accounts underlying our credit card receivables according to the terms of the related cardholder agreements and, except for annual membership fees, we recognize these fees as income when they are charged to the customers’ accounts. We accrete annual membership fees associated with our credit card receivables into income on a straight-line basis over the cardholder privilege period. Similarly, fees on our other credit products are recognized when earned, which coincides with the time they are charged to the customer’s account. Fees and related income on earning assets, net of amounts that we consider uncollectible, are included in loans and fees receivable and revenue when the fees are earned. In periods where applicable, we accrue periodic billed rental amounts (net of allowances for uncollectible billings) into revenues over the rental period to which the billed amounts relate, and we defer recognition in revenues of any advanced customer rental payments until the rental period in which they are properly recognizable under the terms of the contract. The components (in thousands) of our fees and related income on earning assets are as follows:
The above changes in the fair value of loans and fees receivable recorded at fair value category exclude the impact of charge offs associated with these receivables which are separately stated in Net recovery of charge off of loans and fees receivable recorded at fair value on our consolidated statements of operations. See Note 6, “Fair Values of Assets and Liabilities,” for further discussion of these receivables and their effects on our consolidated statements of operations. Revenue from Contracts with Customers In the first quarter of 2018, we adopted Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” under the modified retrospective transition method. We have determined that revenue from contracts with customers would primarily consist of interchange revenues in our Credit and Other Investments segment and other customer-related fees in both our Credit and Other Investments segment and our Auto Finance segment. Revenue from these contracts with customers is included as a component of Other income on our Consolidated Statements of Operations. Components (in thousands) of our revenue from contracts with customers is as follows:
(1) Interchange revenue is presented net of customer reward expense |
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New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. The guidance requires an assessment of credit losses based on expected rather than incurred losses (known as the current expected credit loss model). This generally will result in the recognition of allowances for losses earlier than under current accounting guidance for trade and other receivables, held to maturity debt securities and other instruments. The standard will be adopted on a prospective basis with a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. We are currently in the process of reviewing accounting interpretations, expected data requirements and necessary changes to our loss estimation methods, processes and systems. This standard is expected to result in an increase to our allowance for loan losses given the change to expected losses for the estimated life of the financial asset. The extent of the increase will depend on the asset quality of the portfolio, and economic conditions and forecasts at adoption. In February 2016, the FASB issued ASU No. 2016-02, Leases, which requires lessees to recognize assets and liabilities for most leases, changing certain aspects of current lessor accounting, among other things. ASU 2016-02 is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The adoption of ASU 2016-02 will result in the Company recognizing a right-of-use asset and lease liability on the consolidated balance sheet based on the present value of remaining operating lease payments. Net future minimum lease payments totaled $12.2 million as of December 31, 2017. We do not expect the adoption of ASU 2016-02 to have a material impact on our consolidated financial statements due to the limited lease activity we are involved in. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 establishes a principles-based model under which revenue from a contract is allocated to the distinct performance obligations within the contract and recognized in income as each performance obligation is satisfied. Additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract is also required. In August 2015, the FASB delayed the effective date by one year and the guidance was effective for annual and interim periods beginning January 1, 2018. Most revenue associated with financial instruments, including interest income, loan origination fees and credit card fees, is outside the scope of the guidance. We adopted this standard as of January 1, 2018 using the modified retrospective method of adoption. Our adoption of this standard did not have a material impact on our consolidated financial statements. |
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Subsequent Events | Subsequent Events We evaluate subsequent events that occur after our consolidated balance sheet date but before our consolidated financial statements are issued. There are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements; and (2) nonrecognized, or those that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to that date. We have evaluated subsequent events occurring after March 31, 2018, and based on our evaluation we did not identify any recognized or nonrecognized subsequent events that would have required further adjustments to our consolidated financial statements. |
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Significant Accounting Policies and Consolidated Financial Statement Components | Significant Accounting Policies and Consolidated Financial Statement Components The following is a summary of significant accounting policies we follow in preparing our consolidated financial statements, as well as a description of significant components of our consolidated financial statements. Basis of Presentation and Use of Estimates We prepare our consolidated financial statements in accordance with generally accepted accounting principles in the U.S. (“GAAP”). The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of our consolidated financial statements, as well as the reported amounts of revenues and expenses during each reporting period. We base these estimates on information available to us as of the date of the financial statements. Actual results could differ materially from these estimates. Certain estimates, such as credit losses, payment rates, costs of funds, discount rates and the yields earned on credit card receivables, significantly affect the reported amount of credit card receivables that we report at fair value and our notes payable associated with structured financings, at fair value; these estimates likewise affect the changes in these amounts reflected within our fees and related income on earning assets line item on our consolidated statements of operations. Additionally, estimates of future credit losses have a significant effect on loans and fees receivable, net, as shown on our consolidated balance sheets, as well as on the provision for losses on loans and fees receivable within our consolidated statements of operations. We have eliminated all significant intercompany balances and transactions for financial reporting purposes. Loans and Fees Receivable Our loans and fees receivable include loans and fees receivable, at fair value and loans and fees receivable, gross. As of March 31, 2018 and December 31, 2017, the weighted average remaining accretion period for the $36.1 million and $37.0 million of deferred revenue reflected in the consolidated balance sheets was 12 months and 11 months, respectively. A roll-forward (in millions) of our allowance for uncollectible loans and fees receivable by class of receivable is as follows:
An aging of our delinquent loans and fees receivable, gross (in millions) by class of receivable as of March 31, 2018 and December 31, 2017 is as follows:
Troubled Debt Restructurings. As part of ongoing collection efforts, once an account in our Credit and Other Investments segment is 90 days or more past due, the account is placed on a non-accrual status. Placement on a non-accrual status results in the elimination of the annual percentage rate (“APR”) charged to an account and a cessation of fee billing. Following this adjustment, if a customer demonstrates a willingness and ability to resume making monthly payments and meets certain additional criteria, we will re-age the customer’s account. When we re-age an account, we adjust the status of the account to bring a delinquent account current, but generally do not make any further modifications to the payment terms or amount owed. Once an account is placed on a non-accrual status, it is closed for further purchases. Accounts that are placed on a non-accrual status and thereafter make at least one payment qualify as troubled debt restructurings (“TDRs”). The following table details by class of receivable, the number and amount of modified loans, including TDRs that have been re-aged, of March 31, 2018 and December 31, 2017:
*“TDRs - Performing” include accounts that are current on all amounts owed, while “TDRs - Nonperforming” include all accounts with past due amounts owed. Given that the above TDRs have a high reserve rate prior to modification as TDRs, we do not separately reserve or impair these receivables outside of our general reserve process. The following table details by class of receivable, the number of accounts and carrying value of loans that completed a modification (including those that were classified as TDRs) within the prior twelve months and subsequently charged off.
Prepaid Expenses and Other Assets Prepaid expenses and other assets include amounts paid to third parties for marketing and other services as well as amounts owed to us by third parties. Prepaid amounts are expensed as the underlying related services are performed. Also included are (1) commissions paid associated with our various office leases which we amortize into expense over the lease terms, (2) amounts due from a third party in respect of a servicing agreement totaling $31.6 million as of March 31, 2018, (3) ongoing deferred costs associated with service contracts and (4) investments in consumer finance technology platforms carried at the lower of cost or market valuation. Accounts Payable and Accrued Expenses Accounts payable and accrued expenses reflect both the billed and unbilled amounts owed at the end of a period for services rendered. Also included within accounts payable and accrued expenses are amounts which may be owed in respect of one of our portfolios. Income Taxes We experienced a negative effective income tax expense rate of 3.1% for the three months ended March 31, 2018, compared to an effective income tax expense rate of 45.9% for the three months ended March 31, 2017. Our negative effective income tax expense rate for the three months ended March 31, 2018, is below the statutory rate principally due to (1) interest we accrued during such period on unpaid federal tax liabilities and uncertain tax positions, (2) additions during such period to valuation allowances against our net federal deferred tax assets associated with our net loss incurred during such period, and (3) foreign tax expense incurred during such period. Our effective income tax expense rate for the three months ended March 31, 2017 was above the statutory rate applicable during such period principally due to interest we accrued during such period on unpaid federal tax liabilities. As implied above, we report income tax-related interest and penalties (including those associated with both our accrued liabilities for uncertain tax positions and unpaid tax liabilities) within our income tax benefit or expense line item on our consolidated statements of operations. We likewise report the reversal of income tax-related interest and penalties within such line item to the extent that we resolve our liabilities for uncertain tax positions or unpaid tax liabilities in a manner favorable to our accruals therefor. During both the three months ended March 31, 2018, and 2017, we included $0.2 million of net income tax-related interest and penalties within those periods’ respective income tax expense line items. In December 2014, we reached a settlement with the IRS concerning the tax treatment of net operating losses we incurred in 2007 and 2008 and carried back to obtain refunds of federal income taxes paid in earlier years dating back to 2003. Our net unpaid income tax assessment associated with that settlement was $7.4 million at March 31, 2018; this amount excludes unpaid interest and penalties on the tax assessment, the accruals for which aggregated $4.3 million at March 31, 2018. Prior to our filing amended return claims that would have eliminated the $7.4 million assessment (and corresponding interest and penalties) under a negotiated provision of the IRS settlement, the IRS filed a lien (as is customarily the case), associated with the assessment. Subsequently, an IRS examination team denied our amended return claims, and we filed a protest with IRS Appeals. Following correspondence and conferences we held with IRS Appeals, we received a settlement offer from IRS Appeals in April 2018 that would reduce our $7.4 million net unpaid income tax assessment referenced above to $3.7 million. We currently are evaluating the settlement offer, and should we accept the offer, (1) our $3.7 million reduction in the unpaid income tax assessment and liability accrued therefor would be reversed into income (along with a commensurate portion of the $4.3 million we have accrued for interest and penalties associated with the $3.7 million settled accrual), and (2) we would expect to pay the remaining accrued income tax, interest and penalties liability to the IRS after the settlement is finalized. Revenue Recognition and Revenue from Contracts with Customers Consumer Loans, Including Past Due Fees Consumer loans, including past due fees reflect interest income, including finance charges, and late fees on loans in accordance with the terms of the related customer agreements. Premiums and discounts paid or received associated with a loan are generally deferred and amortized over the average life of the related loans using the effective interest method. Finance charges and fees, net of amounts that we consider uncollectible, are included in loans and fees receivable and revenue when the fees are earned. Fees and Related Income on Earning Assets Fees and related income on earning assets primarily include: (1) fees associated with our credit products, including the receivables underlying our U.S. point-of-sale finance and direct-to-consumer activities, and our historical credit card receivables; (2) changes in the fair value of loans and fees receivable recorded at fair value; (3) changes in fair value of notes payable associated with structured financings recorded at fair value; (4) revenues associated with rent payments on rental merchandise; and (5) gains or losses associated with our investments in securities. We assess fees on credit card accounts underlying our credit card receivables according to the terms of the related cardholder agreements and, except for annual membership fees, we recognize these fees as income when they are charged to the customers’ accounts. We accrete annual membership fees associated with our credit card receivables into income on a straight-line basis over the cardholder privilege period. Similarly, fees on our other credit products are recognized when earned, which coincides with the time they are charged to the customer’s account. Fees and related income on earning assets, net of amounts that we consider uncollectible, are included in loans and fees receivable and revenue when the fees are earned. In periods where applicable, we accrue periodic billed rental amounts (net of allowances for uncollectible billings) into revenues over the rental period to which the billed amounts relate, and we defer recognition in revenues of any advanced customer rental payments until the rental period in which they are properly recognizable under the terms of the contract. The components (in thousands) of our fees and related income on earning assets are as follows:
The above changes in the fair value of loans and fees receivable recorded at fair value category exclude the impact of charge offs associated with these receivables which are separately stated in Net recovery of charge off of loans and fees receivable recorded at fair value on our consolidated statements of operations. See Note 6, “Fair Values of Assets and Liabilities,” for further discussion of these receivables and their effects on our consolidated statements of operations. Revenue from Contracts with Customers In the first quarter of 2018, we adopted Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” under the modified retrospective transition method. We have determined that revenue from contracts with customers would primarily consist of interchange revenues in our Credit and Other Investments segment and other customer-related fees in both our Credit and Other Investments segment and our Auto Finance segment. Revenue from these contracts with customers is included as a component of Other income on our Consolidated Statements of Operations. Components (in thousands) of our revenue from contracts with customers is as follows:
(1) Interchange revenue is presented net of customer reward expense Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. The guidance requires an assessment of credit losses based on expected rather than incurred losses (known as the current expected credit loss model). This generally will result in the recognition of allowances for losses earlier than under current accounting guidance for trade and other receivables, held to maturity debt securities and other instruments. The standard will be adopted on a prospective basis with a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019, with early adoption permitted. We are currently in the process of reviewing accounting interpretations, expected data requirements and necessary changes to our loss estimation methods, processes and systems. This standard is expected to result in an increase to our allowance for loan losses given the change to expected losses for the estimated life of the financial asset. The extent of the increase will depend on the asset quality of the portfolio, and economic conditions and forecasts at adoption. In February 2016, the FASB issued ASU No. 2016-02, Leases, which requires lessees to recognize assets and liabilities for most leases, changing certain aspects of current lessor accounting, among other things. ASU 2016-02 is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The adoption of ASU 2016-02 will result in the Company recognizing a right-of-use asset and lease liability on the consolidated balance sheet based on the present value of remaining operating lease payments. Net future minimum lease payments totaled $12.2 million as of December 31, 2017. We do not expect the adoption of ASU 2016-02 to have a material impact on our consolidated financial statements due to the limited lease activity we are involved in. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” ASU 2014-09 establishes a principles-based model under which revenue from a contract is allocated to the distinct performance obligations within the contract and recognized in income as each performance obligation is satisfied. Additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract is also required. In August 2015, the FASB delayed the effective date by one year and the guidance was effective for annual and interim periods beginning January 1, 2018. Most revenue associated with financial instruments, including interest income, loan origination fees and credit card fees, is outside the scope of the guidance. We adopted this standard as of January 1, 2018 using the modified retrospective method of adoption. Our adoption of this standard did not have a material impact on our consolidated financial statements. Subsequent Events We evaluate subsequent events that occur after our consolidated balance sheet date but before our consolidated financial statements are issued. There are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements; and (2) nonrecognized, or those that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to that date. We have evaluated subsequent events occurring after March 31, 2018, and based on our evaluation we did not identify any recognized or nonrecognized subsequent events that would have required further adjustments to our consolidated financial statements. |
Significant Accounting Policies and Consolidated Financial Statement Components (Tables) |
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Revenue from Contract with Customer [Text Block] | Components (in thousands) of our revenue from contracts with customers is as follows:
(1) Interchange revenue is presented net of customer reward expense |
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Troubled Debt Restructurings on Financing Receivables [Table Text Block] | The following table details by class of receivable, the number and amount of modified loans, including TDRs that have been re-aged, of March 31, 2018 and December 31, 2017:
*“TDRs - Performing” include accounts that are current on all amounts owed, while “TDRs - Nonperforming” include all accounts with past due amounts owed. Given that the above TDRs have a high reserve rate prior to modification as TDRs, we do not separately reserve or impair these receivables outside of our general reserve process. The following table details by class of receivable, the number of accounts and carrying value of loans that completed a modification (including those that were classified as TDRs) within the prior twelve months and subsequently charged off.
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Roll-forward of allowance for uncollectible loans and fees receivable, net | A roll-forward (in millions) of our allowance for uncollectible loans and fees receivable by class of receivable is as follows:
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Delinquent loans and fees receivable, gross | An aging of our delinquent loans and fees receivable, gross (in millions) by class of receivable as of March 31, 2018 and December 31, 2017 is as follows:
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Components of fees and related income on earning assets | The components (in thousands) of our fees and related income on earning assets are as follows:
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Troubled Debt Restructurings Subsequent Chargeoff [Table Text Block] | The following table details by class of receivable, the number of accounts and carrying value of loans that completed a modification (including those that were classified as TDRs) within the prior twelve months and subsequently charged off.
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Significant Accounting Policies and Consolidated Financial Statement Components Troubled Debt Restructuring (Tables) |
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Troubled Debt Restructuring [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Troubled Debt Restructurings on Financing Receivables [Table Text Block] | The following table details by class of receivable, the number and amount of modified loans, including TDRs that have been re-aged, of March 31, 2018 and December 31, 2017:
*“TDRs - Performing” include accounts that are current on all amounts owed, while “TDRs - Nonperforming” include all accounts with past due amounts owed. Given that the above TDRs have a high reserve rate prior to modification as TDRs, we do not separately reserve or impair these receivables outside of our general reserve process. The following table details by class of receivable, the number of accounts and carrying value of loans that completed a modification (including those that were classified as TDRs) within the prior twelve months and subsequently charged off.
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Segment Reporting (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of operating segment information | Summary operating segment information (in thousands) is as follows:
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Investments in Equity-Method Investees (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summarized data of combined balance sheet and results of operations for our equity-method investees | In the following tables, we summarize (in thousands) balance sheet and results of operations data for our equity-method investee:
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Fair Values of Assets and Liabilities (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets measured on a recurring basis at fair value | The table below summarizes (in thousands) by fair value hierarchy the March 31, 2018 and December 31, 2017 fair values and carrying amounts of (1) our assets that are required to be carried at fair value in our consolidated financial statements and (2) our assets not carried at fair value, but for which fair value disclosures are required:
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Reconciliation of Level 3 assets measured at fair value on a recurring basis using significant unobservable inputs | For Level 3 assets carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) a reconciliation of the beginning and ending balances for the three months ended March 31, 2018 and 2017:
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Level 3 assets measured at fair value on a recurring basis using significant unobservable inputs, quantitative information | For Level 3 assets carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) quantitative information about the valuation techniques and the inputs used in the fair value measurement as of March 31, 2018 and December 31, 2017:
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Liabilities measured on a recurring basis at fair value | The table below summarizes (in thousands) by fair value hierarchy the March 31, 2018 and December 31, 2017 fair values and carrying amounts of (1) our liabilities that are required to be carried at fair value in our consolidated financial statements and (2) our liabilities not carried at fair value, but for which fair value disclosures are required:
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Reconciliation for Level 3 Liabilities measured at fair value on a recurring basis using significant unobservable inputs | For our material Level 3 liabilities carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) a reconciliation of the beginning and ending balances for the three months ended March 31, 2018 and 2017.
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Level 3 liabilities measured at fair value on a recurring basis using significant unobservable inputs, quantitative information | For material Level 3 liabilities carried at fair value measured on a recurring basis using significant unobservable inputs, the following table presents (in thousands) quantitative information about the valuation techniques and the inputs used in the fair value measurement as of March 31, 2018 and December 31, 2017:
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Other relevant data concerning our assets and liabilities measured at fair value | Other relevant data (in thousands) as of March 31, 2018 and December 31, 2017 concerning certain assets and liabilities we carry at fair value are as follows:
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Notes Payable (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of structured financing notes at fair value | Scheduled (in millions) in the table below are (1) the carrying amount of our structured financing note secured by certain credit card receivables and reported at fair value as of March 31, 2018 and December 31, 2017, (2) the outstanding face amount of our structured financing note secured by certain credit card receivables and reported at fair value as of March 31, 2018 and December 31, 2017, and (3) the carrying amount of the credit card receivables and restricted cash that provide the exclusive means of repayment for the note (i.e., lenders have recourse only to the specific credit card receivables and restricted cash underlying each respective facility and cannot look to our general credit for repayment) as of March 31, 2018 and December 31, 2017.
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Schedule of structured financing notes at face value | Other notes payable outstanding as of March 31, 2018 and December 31, 2017 that are secured by the financial and operating assets of either the borrower, another of our subsidiaries or both, include the following, scheduled (in millions); except as otherwise noted, the assets of our holding company (Atlanticus Holdings Corporation) are subject to creditor claims under these scheduled facilities:
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Convertible Senior Notes (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of consolidated balance sheets associated with convertible senior notes | The following summarizes (in thousands) components of our consolidated balance sheets associated with our convertible senior notes:
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Net Income (Loss) Attributable to Controlling Interests Per Common Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computations of net income (loss) per common share | The following table sets forth the computations of net loss per common share (in thousands, except per share data):
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Stock-Based Compensation Share Based Compensation (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Stock Based Compensation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Compensation, Stock Options, Activity [Table Text Block] | The table below includes additional information about outstanding options:
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Description of Our Business (Details) |
3 Months Ended |
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Mar. 31, 2018
segment
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 2 |
Significant Accounting Policies and Consolidated Financial Statement Components Loans and Fees Receivable, Net Narrative (Details) |
3 Months Ended | |
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Mar. 31, 2018 |
Mar. 31, 2017 |
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Accounting Policies [Abstract] | ||
Weighted Average Remaining Accretion Period of Deferred Revenue | 12 months | 11 months |
Significant Accounting Policies and Consolidated Financial Statement Components Property at cost, net of depreciation (Details) - USD ($) $ in Millions |
3 Months Ended | |
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Mar. 31, 2018 |
Mar. 31, 2017 |
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Property, Plant and Equipment [Line Items] | ||
Effective Income Tax Rate Reconciliation, Percent | 3.10% | 45.90% |
Unrecognized Tax Benefits, Income Tax Penalties Expense | $ 0.2 | |
Income tax settlement amount with taxing authority | $ 7.4 | |
Other Assets, Miscellaneous | 31.6 | |
Income Tax Examination, Interest Accrued | $ 4.3 |
Significant Accounting Policies and Consolidated Financial Statement Components Investments in Equity-Method Investees (Details) |
Mar. 31, 2018 |
---|---|
Schedule of Equity Method Investments [Line Items] | |
Equity-method investment, interests | 66.70% |
Significant Accounting Policies and Consolidated Financial Statement Components Rental Merchandise (Details) $ in Thousands |
3 Months Ended |
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Mar. 31, 2017
USD ($)
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Leased Merchandise [Abstract] | |
Depreciation of rental merchandise | $ 27 |
Significant Accounting Policies and Consolidated Financial Statement Components Troubled Debt Restructuring (Details) $ in Thousands |
3 Months Ended | 12 Months Ended | |
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Mar. 31, 2018
USD ($)
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Mar. 31, 2017
USD ($)
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Dec. 31, 2017
USD ($)
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Financing Receivable, Modifications [Line Items] | |||
Threshold period past due for Non-Accrual of Finance Receivable | 90 days | ||
Point-of-Sale [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Financing Receivable, Modifications, Subsequent Default, Number of Contracts | 1,881,000 | 1,617,000 | |
Financing Receivable Modifications Number Of Contracts Outstanding | 11,711,000 | 11,432,000 | |
Financing Receivable, Modifications, Recorded Investment | $ 17,388 | $ 17,169 | |
Financing Receivable, Modification, Carrying Value, Nonaccrual Status | 5,431 | 4,247 | |
Financing Receivable, Modification, Carrying Value, Nonaccrual Status, Performing | 3,563 | 2,368 | |
Financing Receivable, Modification, Carrying Value, Nonaccrual Status, Nonperforming | 1,868 | $ 1,879 | |
Financing Receivable, Modifications, Subsequent Default, Recorded Investment | $ 2,885 | $ 1,860 | |
Direct-to-Consumer [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Financing Receivable, Modifications, Subsequent Default, Number of Contracts | 868,000 | 654,000 | |
Financing Receivable Modifications Number Of Contracts Outstanding | 8,650,000 | 6,681,000 | |
Financing Receivable, Modifications, Recorded Investment | $ 8,778 | $ 7,067 | |
Financing Receivable, Modification, Carrying Value, Nonaccrual Status | 1,365 | 1,173 | |
Financing Receivable, Modification, Carrying Value, Nonaccrual Status, Performing | 856 | 508 | |
Financing Receivable, Modification, Carrying Value, Nonaccrual Status, Nonperforming | 509 | $ 665 | |
Financing Receivable, Modifications, Subsequent Default, Recorded Investment | $ 1,845 | $ 1,906 | |
Extended Maturity [Member] | Point-of-Sale [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Financing Receivable Modifications Number Of Contracts Outstanding | 1,135,000 | 915,000 | |
Financing Receivable, Modifications, Recorded Investment | $ 2,048 | $ 1,570 | |
Extended Maturity [Member] | Direct-to-Consumer [Member] | |||
Financing Receivable, Modifications [Line Items] | |||
Financing Receivable Modifications Number Of Contracts Outstanding | 157,000 | 80,000 | |
Financing Receivable, Modifications, Recorded Investment | $ 171 | $ 86 |
Significant Accounting Policies and Consolidated Financial Statement Components Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | ||
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Mar. 31, 2018 |
Mar. 31, 2017 |
Apr. 30, 2018 |
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Income Tax Examination [Line Items] | |||
Income Tax Examination, Interest Accrued | $ 4.3 | ||
Income tax settlement amount with taxing authority | $ 7.4 | ||
Unrecognized Tax Benefits, Income Tax Penalties Expense | $ 0.2 | ||
Effective Income Tax Rate Reconciliation, Percent | 3.10% | 45.90% | |
Subsequent Event [Member] | |||
Income Tax Examination [Line Items] | |||
Income tax settlement amount with taxing authority | $ 3.7 |
Segment Reporting (Details) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018
USD ($)
industry
segment
|
Mar. 31, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
|
|
Segment Reporting Information [Line Items] | |||
Number of industries the Company operates in | industry | 1 | ||
Number of reportable segments | segment | 2 | ||
Interest income: | |||
Consumer loans, including past due fees | $ 35,681 | $ 25,859 | |
Other | 45 | 101 | |
Total interest income | 35,726 | 25,960 | |
Interest expense | (8,153) | (5,817) | |
Net interest income before fees and related income on earning assets and provision for losses on loans and fees receivable | 27,573 | 20,143 | |
Fees and related income on earning assets | 6,214 | 2,801 | |
Servicing income | 632 | 1,089 | |
Depreciation of rental merchandise | (27) | ||
Equity in income of equity-method investee | 9 | 334 | |
(Loss) income before income taxes | (4,575) | 1,345 | |
Income Tax Expense (Benefit) | (144) | (618) | |
Total assets | 432,912 | 371,123 | $ 425,613 |
Reportable Segments One [Member] | |||
Interest income: | |||
Consumer loans, including past due fees | 28,562 | 18,830 | |
Other | 45 | 101 | |
Total interest income | 28,607 | 18,931 | |
Interest expense | (7,892) | (5,594) | |
Net interest income before fees and related income on earning assets and provision for losses on loans and fees receivable | 20,715 | 13,337 | |
Fees and related income on earning assets | 6,197 | 2,779 | |
Servicing income | 402 | 857 | |
Depreciation of rental merchandise | (27) | ||
Equity in income of equity-method investee | 9 | 334 | |
(Loss) income before income taxes | (6,914) | (387) | |
Income Tax Expense (Benefit) | 399 | (33) | |
Total assets | 365,882 | 306,721 | |
Reportable Segments Three [Member] | |||
Interest income: | |||
Consumer loans, including past due fees | 7,119 | 7,029 | |
Other | 0 | 0 | |
Total interest income | 7,119 | 7,029 | |
Interest expense | (261) | (223) | |
Net interest income before fees and related income on earning assets and provision for losses on loans and fees receivable | 6,858 | 6,806 | |
Fees and related income on earning assets | 17 | 22 | |
Servicing income | 230 | 232 | |
Depreciation of rental merchandise | 0 | ||
Equity in income of equity-method investee | 0 | 0 | |
(Loss) income before income taxes | 2,339 | 1,732 | |
Income Tax Expense (Benefit) | (543) | (585) | |
Total assets | $ 67,030 | $ 64,402 |
Shareholders' Equity (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Class of Stock [Line Items] | |||
Stock Repurchased and Retired During Period, Value | $ 14,000 | ||
Own-share Lending Arrangement, Shares, Outstanding | 1,459,233 | 1,459,233 | |
Treasury Stock [Member] | |||
Class of Stock [Line Items] | |||
Stock Repurchased and Retired During Period, Shares | 7,006 | 6,702 | |
Stock Repurchased and Retired During Period, Value | $ 14,000 | $ 18,000 |
Investments in Equity-Method Investees (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Schedule of Equity Method Investments [Line Items] | |||
Equity-method investment, interests | 66.70% | ||
Summarized data of combined balance sheet and results of operations for our equity-method investees [Abstract] | |||
Net income attributable to our equity investment in investee | $ 9 | $ 334 | |
Equity-Method Investees [Member] | |||
Summarized data of combined balance sheet and results of operations for our equity-method investees [Abstract] | |||
Equity Method Investment, Summarized Financial Information, Noncurrent Assets | 5,088 | $ 6,123 | |
Total assets | 5,366 | 6,392 | |
Total liabilities | 24 | 26 | |
Equity Method Investment Summarized Financial Information, Equity | 5,342 | $ 6,366 | |
Equity Method Investment, Summarized Financial Information, Revenue | 14 | 504 | |
Net income | (61) | 397 | |
Net income attributable to our equity investment in investee | $ 9 | $ 334 |
Fair Values of Assets and Liabilities Summary of Fair Value Hierarchy for Assets (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
|||
---|---|---|---|---|---|
Fair Value, Measurements, Recurring [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loans and fees receivable, net for which it is practicable to estimate fair value | [1] | $ 306,307 | $ 293,972 | ||
Loans and fees receivable, at fair value | [1] | 9,413 | 11,109 | ||
Fair Value, Measurements, Recurring [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loans and fees receivable, net for which it is practicable to estimate fair value | [1] | 0 | 0 | ||
Loans and fees receivable, at fair value | [1] | 0 | 0 | ||
Fair Value, Measurements, Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loans and fees receivable, net for which it is practicable to estimate fair value | [1] | 0 | 0 | ||
Loans and fees receivable, at fair value | [1] | 0 | 0 | ||
Fair Value, Measurements, Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loans and fees receivable, net for which it is practicable to estimate fair value | [1] | 328,404 | 324,945 | ||
Loans and fees receivable, at fair value | [1] | 9,413 | 11,109 | ||
Loans And Fees Receivable [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loans and fees receivable, at fair value | $ 1,504 | $ 1,869 | |||
|
Fair Values of Assets and Liabilities Reconciliation of Level 3 Assets (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Reconciliation of Level 3 assets measured at fair value on a recurring basis using significant unobservable inputs [Abstract] | ||
Beginning Balance | $ 11,109 | $ 15,648 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings, Description | (18) | 563 |
Settlements | (1,691) | (2,626) |
Impact of foreign currency translation | 13 | 6 |
Ending Balance | $ 9,413 | $ 13,591 |
Fair Values of Assets and Liabilities Quantitative Information about Level 3 Assets Fair Value Measurements (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Gross yield | 27.90% | 25.90% | |
Principal payment rate | 2.60% | 2.50% | |
Expected credit loss rate | 13.40% | 9.40% | |
Discount rate | 14.40% | 14.20% | |
Loans And Fees Receivable [Member] | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Loans and Fees Receivable, at Fair Value | $ 9,413 | $ 11,109 | |
Loans And Fees Receivable [Member] | Minimum [Member] | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Gross yield | 16.30% | 15.80% | |
Principal payment rate | 1.20% | 1.90% | |
Expected credit loss rate | 9.00% | 9.40% | |
Servicing rate | 12.00% | 10.20% | |
Discount rate | 6.00% | 6.00% | |
Loans And Fees Receivable [Member] | Maximum [Member] | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Gross yield | 27.90% | 27.40% | |
Principal payment rate | 3.10% | 3.60% | |
Expected credit loss rate | 13.40% | 10.40% | |
Servicing rate | 14.80% | 12.30% | |
Discount rate | 14.40% | 14.20% | |
Loans And Fees Receivable [Member] | Weighted Average [Member] | |||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | |||
Gross yield | 25.80% | 24.50% | |
Principal payment rate | 2.40% | 2.60% | |
Expected credit loss rate | 12.30% | 9.70% | |
Servicing rate | 12.30% | 10.50% | |
Discount rate | 12.90% | 12.80% |
Fair Values of Assets and Liabilities Summary of Fair Value Hierarchy for Liabilities (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
Nov. 30, 2005 |
May 31, 2005 |
---|---|---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Long-term Line of Credit | $ 183,388 | $ 160,854 | ||
Amortizing debt facilities | 58,742 | 65,384 | ||
Notes Payable, Related Parties | 40,000 | 40,000 | ||
Convertible Debt, Fair Value Disclosures | 61,650 | 61,393 | ||
Liabilities carried at fair value | ||||
Notes payable associated with structured financings, at fair value | 7,909 | 9,240 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Long-term Line of Credit | 0 | 0 | ||
Amortizing debt facilities | 0 | 0 | ||
Notes Payable, Related Parties | 0 | 0 | ||
Convertible Debt, Fair Value Disclosures | 0 | 0 | ||
Liabilities carried at fair value | ||||
Notes payable associated with structured financings, at fair value | 0 | 0 | ||
Significant Other Observable Inputs (Level 2) [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Long-term Line of Credit | 0 | 0 | ||
Amortizing debt facilities | 0 | 0 | ||
Notes Payable, Related Parties | 0 | 0 | ||
Convertible Debt, Fair Value Disclosures | 43,588 | 43,588 | ||
Liabilities carried at fair value | ||||
Notes payable associated with structured financings, at fair value | 0 | 0 | ||
Significant Unobservable Inputs (Level 3) [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Long-term Line of Credit | 183,388 | 160,854 | ||
Amortizing debt facilities | 58,742 | 65,384 | ||
Notes Payable, Related Parties | 40,000 | 40,000 | ||
Convertible Debt, Fair Value Disclosures | 0 | 0 | ||
Liabilities carried at fair value | ||||
Notes payable associated with structured financings, at fair value | $ 7,909 | $ 9,240 | ||
Five Point Eight Seven Five Percent Convertible Senior Notes Due Two Thousand Thirty Five [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 5.875% | 5.875% |
Fair Values of Assets and Liabilities Reconciliation of Level 3 Liabilities (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning Balance | $ 9,240 | $ 12,276 |
Total (gains) losses—realized/unrealized: | ||
Net revaluations of notes payable associated with structured financings, at fair value | (1,331) | (706) |
Repayments on outstanding notes payable, net | 0 | (439) |
Ending Balance | $ 7,909 | $ 11,131 |
Fair Values of Assets and Liabilities Quantitative Information about Level 3 Liabilities Fair Value Measurements (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
|
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||
Notes payable associated with structured financings, at fair value | $ 7,909 | $ 9,240 | |
Gross yield | 27.90% | 25.90% | |
Principal payment rate | 2.60% | 2.50% | |
Expected credit loss rate | 13.40% | 9.40% | |
Discount rate | 14.40% | 14.20% | |
Loans And Fees Receivable [Member] | Minimum [Member] | |||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||
Gross yield | 16.30% | 15.80% | |
Principal payment rate | 1.20% | 1.90% | |
Expected credit loss rate | 9.00% | 9.40% | |
Discount rate | 6.00% | 6.00% | |
Fair Value Inputs Servicing Rate | 12.00% | 10.20% | |
Loans And Fees Receivable [Member] | Maximum [Member] | |||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||
Gross yield | 27.90% | 27.40% | |
Principal payment rate | 3.10% | 3.60% | |
Expected credit loss rate | 13.40% | 10.40% | |
Discount rate | 14.40% | 14.20% | |
Fair Value Inputs Servicing Rate | 14.80% | 12.30% | |
Loans And Fees Receivable [Member] | Weighted Average [Member] | |||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | |||
Gross yield | 25.80% | 24.50% | |
Principal payment rate | 2.40% | 2.60% | |
Expected credit loss rate | 12.30% | 9.70% | |
Discount rate | 12.90% | 12.80% | |
Fair Value Inputs Servicing Rate | 12.30% | 10.50% |
Fair Values of Assets and Liabilities, Other Relevant Data (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
Nov. 30, 2005 |
May 31, 2005 |
---|---|---|---|---|
Structured Financing Notes Payable [Member] | ||||
Schedule of Fair Value Assets And Liabilities [Line Items] | ||||
Aggregate unpaid principal balance of notes payable | $ 101,314 | $ 101,314 | ||
Aggregate fair value of notes payable | 7,909 | 9,240 | ||
Loans and Fees Receivable, at Fair Value [Member] | ||||
Schedule of Fair Value Assets And Liabilities [Line Items] | ||||
Aggregate unpaid principal balance within loans and fees receivable that are reported at fair value | 4,088 | 4,416 | ||
Aggregate fair value of loans and fees receivable that are reported at fair value | 1,504 | 1,869 | ||
Aggregate fair value of receivables carried at fair value that are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) | 2 | 5 | ||
Aggregate excess of balance of unpaid principal receivables within loans and fees receivable that are reported at fair value and are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) over the fair value of such loans and fees receivable | 85 | 107 | ||
Loans and Fees Receivable Pledged as Collateral under Structured Financings, at Fair Value [Member] | ||||
Schedule of Fair Value Assets And Liabilities [Line Items] | ||||
Aggregate unpaid principal balance within loans and fees receivable that are reported at fair value | 10,222 | 11,349 | ||
Aggregate fair value of loans and fees receivable that are reported at fair value | 7,909 | 9,240 | ||
Aggregate fair value of receivables carried at fair value that are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) | 12 | 17 | ||
Aggregate excess of balance of unpaid principal receivables within loans and fees receivable that are reported at fair value and are 90 days or more past due (which also coincides with finance charge and fee non-accrual policies) over the fair value of such loans and fees receivable | $ 303 | $ 369 | ||
5.875% Convertible Senior Notes Due 2035 [Member] | ||||
Schedule of Fair Value Assets And Liabilities [Line Items] | ||||
Interest rate on notes | 5.875% | 5.875% |
Notes Payable Schedule of structured financing notes at fair value (Details) - USD ($) |
3 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
||||||
Debt Instrument [Line Items] | |||||||
Total structured financing notes reported at fair value that are secured by credit card receivables and to which we are subordinated | $ 7,909,000 | $ 9,240,000 | |||||
Debt, Weighted Average Interest Rate | [1],[2] | 6.30% | 6.00% | ||||
Credit card receivables and restricted cash carrying amount as security for notes payable | $ 7,900,000 | ||||||
Maturity date | Nov. 30, 2035 | ||||||
Loans Pledged as Collateral | [1],[2] | $ 73,100,000 | $ 77,900,000 | ||||
Notes Payable to Banks [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Total structured financing notes reported at fair value that are secured by credit card receivables and to which we are subordinated | 7,900,000 | 9,200,000 | |||||
Amortizing Securitization Facility Expiration Date December 1, 2021 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Face Amount | $ 101,300,000.0 | $ 101,300,000.0 | |||||
Debt, Weighted Average Interest Rate | 7.00% | 6.70% | |||||
Credit card receivables and restricted cash carrying amount as security for notes payable | $ 7,900,000.0 | $ 9,200,000 | |||||
Maturity date | Dec. 01, 2021 | ||||||
|
Notes Payable Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
||||||||||
Debt Instrument [Line Items] | |||||||||||
Long-term Line of Credit | $ 183,388 | $ 160,854 | |||||||||
Debt, Weighted Average Interest Rate | [1],[2] | 6.30% | 6.00% | ||||||||
Notes payable associated with structured financings, at fair value | $ 7,909 | $ 9,240 | |||||||||
Credit card receivables and restricted cash carrying amount as security for notes payable | 7,900 | ||||||||||
Maximum Aggregate Exposure to Pretax Equity Loss Associated With Structured Financing at Fair Value | $ 0 | ||||||||||
Senior Secured Term Loan, Expiring 2018 [Domain] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | [3] | 9.00% | 9.00% | ||||||||
Expiring November 2018 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Long-term Line of Credit | [4] | $ 24,600 | $ 24,800 | ||||||||
Line of Credit Facility, Expiration Date | [4] | Nov. 01, 2019 | |||||||||
Expiring February 2022 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 90,000 | ||||||||||
Long-term Line of Credit | [1],[3] | $ 80,000 | $ 65,000 | ||||||||
Line of Credit Facility, Expiration Date | [1],[3] | Feb. 08, 2022 | |||||||||
Minimum [Member] | Expiring February 2022 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt, Weighted Average Interest Rate | 8.00% | ||||||||||
Maximum [Member] | Expiring February 2022 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt, Weighted Average Interest Rate | 14.00% | ||||||||||
|
Notes Payable Schedule of structured financing notes at face value (Details) - USD ($) $ in Thousands |
3 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Long-term Line of Credit | $ 183,388 | $ 160,854 | |||||||||||
Amortizing debt facilities | 58,742 | 65,384 | |||||||||||
Notes Payable, Related Parties | 40,000 | 40,000 | |||||||||||
Notes Payable, Gross | 284,500 | 268,800 | |||||||||||
Notes Payable | 282,100 | 266,200 | |||||||||||
Debt Issuance Costs, Net | $ 2,400 | $ 2,600 | |||||||||||
Debt, Weighted Average Interest Rate | [1],[2] | 6.30% | 6.00% | ||||||||||
Loans Pledged as Collateral | [1],[2] | $ 73,100 | $ 77,900 | ||||||||||
Maturity date | Nov. 30, 2035 | ||||||||||||
Amortizing Debt Facility Secured By Underlying Merchant Expiring July 2017 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Maturity date | [1],[2],[3] | Jul. 15, 2017 | |||||||||||
Expiring August 2018 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Maturity date | [1],[2] | Sep. 01, 2017 | |||||||||||
Expires March 2018 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Amortizing debt facilities | [1],[2],[3] | $ 0 | 3,700 | ||||||||||
Maturity date | [1],[2],[3] | Mar. 31, 2018 | |||||||||||
Expiring June 2018 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Amortizing debt facilities | [1],[2],[3] | $ 9,200 | 18,300 | ||||||||||
Maturity date | [1],[2],[3] | Jun. 30, 2018 | |||||||||||
Expires August 2018 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Amortizing debt facilities | [1],[2] | $ 4,000 | 6,000 | ||||||||||
Maturity date | [1],[2] | Dec. 12, 2018 | |||||||||||
Expiring September 2018 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Amortizing debt facilities | [1],[2] | $ 5,000 | 7,500 | ||||||||||
Maturity date | [1],[2] | Sep. 14, 2018 | |||||||||||
Expiring November 2018 2 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Amortizing debt facilities | [1],[2],[3] | $ 14,900 | 20,500 | ||||||||||
Maturity date | [1],[2],[3] | Nov. 30, 2018 | |||||||||||
Expires April 22, 2019 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Amortizing debt facilities | [1],[2],[3] | $ 26,100 | 10,000 | ||||||||||
Maturity date | [1],[2],[3] | Apr. 22, 2019 | |||||||||||
Senior Secured Term Loan, Expiring 2018 [Domain] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Notes Payable, Related Parties | [4] | $ 40,000 | $ 40,000 | ||||||||||
Debt Instrument, Interest Rate, Stated Percentage | [4] | 9.00% | 9.00% | ||||||||||
Related Party Transaction, Date | [4] | Nov. 21, 2018 | |||||||||||
Expiring November 2018 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Long-term Line of Credit | [5] | $ 24,600 | $ 24,800 | ||||||||||
Line of Credit Facility, Expiration Date | [5] | Nov. 01, 2019 | |||||||||||
Revolving Credit Facility [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Debt, Weighted Average Interest Rate | 8.30% | 7.80% | |||||||||||
Carrying Amount of Receivables as Security for Structured Financing Notes | $ 243,000 | $ 216,000 | |||||||||||
Expiring October 2017 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Long-term Line of Credit | [1],[2] | $ 49,200 | 49,400 | ||||||||||
Line of Credit Facility, Expiration Date | [1],[2] | Oct. 30, 2019 | |||||||||||
Expiring October 4 2017 [Domain] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Long-term Line of Credit | [1],[2] | $ 11,800 | 3,800 | ||||||||||
Line of Credit Facility, Expiration Date | [1],[2] | Dec. 21, 2019 | |||||||||||
Expiring December 2019 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Long-term Line of Credit | [1],[2] | $ 19,700 | 19,800 | ||||||||||
Line of Credit Facility, Expiration Date | [1],[2] | Dec. 31, 2019 | |||||||||||
Expiring February 2022 [Member] | |||||||||||||
Notes Payable, at Face Value [Abstract] | |||||||||||||
Long-term Line of Credit | [1],[4] | $ 80,000 | $ 65,000 | ||||||||||
Line of Credit Facility, Expiration Date | [1],[4] | Feb. 08, 2022 | |||||||||||
|
Convertible Senior Notes Narrative (Details) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
Nov. 30, 2005 |
May 31, 2005 |
|
Debt Instrument [Line Items] | ||||
Own-share Lending Arrangement, Shares, Outstanding | 1,459,233 | 1,459,233 | ||
Maturity date | Nov. 30, 2035 | |||
5.875% Convertible Senior Notes Due 2035 [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 88,280,000 | $ 88,280,000 | $ 300,000,000.0 | |
Interest rate on notes | 5.875% | 5.875% | ||
Conversion price for convertible senior notes (in dollars per share) | $ 24.61 |
Convertible Senior Notes Components of consolidated balance sheets associated with convertible senior notes (Details) - USD ($) |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
Nov. 30, 2005 |
May 31, 2005 |
|
Debt Instrument [Line Items] | |||||
Convertible Debt | $ 61,650,000 | $ 61,393,000 | |||
Carrying amount of equity component included in additional paid-in capital | 108,714,000 | 108,714,000 | |||
Excess of instruments’ if-converted values over face principal amounts | 0 | $ 0 | |||
5.875% Convertible Senior Notes Due 2035 [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Face Amount | 88,280,000 | 88,280,000 | $ 300,000,000.0 | ||
Debt Instrument, Unamortized Discount | $ 26,630,000 | $ 26,887,000 | |||
Interest rate on notes | 5.875% | 5.875% |
Convertible Senior Notes Accounting for Convertible Senior Notes (Details) - USD ($) |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
Dec. 31, 2017 |
Nov. 30, 2005 |
May 31, 2005 |
|
Debt Instrument [Line Items] | |||||
Maturity date | Nov. 30, 2035 | ||||
Interest expense from accretion of discount on notes | $ 216,000 | $ 178,000 | |||
Own-share Lending Arrangement, Shares, Outstanding | 1,459,233 | 1,459,233 | |||
5.875% Convertible Senior Notes Due 2035 [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, Face Amount | $ 88,280,000 | $ 88,280,000 | $ 300,000,000.0 | ||
Debt Instrument, Interest Rate, Stated Percentage | 5.875% | 5.875% | |||
Conversion price for convertible senior notes (in dollars per share) | $ 24.61 |
Commitments and Contingencies General (Details) $ in Millions |
Mar. 31, 2018
USD ($)
|
---|---|
Supply Commitment [Member] | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | |
Off-balance sheet risks, liability | $ 453.4 |
Commitments to Car Operations [Member] | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | |
Off-balance sheet risks, liability | 8.8 |
Deposits [Member] | |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | |
Off-balance sheet risks, liability | $ 8.7 |
Net Income (Loss) Attributable to Controlling Interests Per Common Share (Details) $ / shares in Units, $ in Thousands |
3 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Mar. 31, 2018
USD ($)
shares
$ / shares
|
Mar. 31, 2017
USD ($)
$ / shares
shares
|
||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Weighted Average Number of Shares, Restricted Stock | 184,196 | 345,385 | |||||
Document Fiscal Year Focus | 2018 | ||||||
Numerator: | |||||||
Net (loss) income attributable to controlling interests | $ | $ (4,670) | $ 728 | |||||
Denominator: | |||||||
Basic (including unvested share-based payment awards) (in shares) | [1] | 13,899,000 | 13,944,000 | ||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements | [2] | 0 | 33,000 | ||||
Weighted Average Number of Shares Outstanding, Diluted | [1] | 13,899,000 | 13,977,000 | ||||
Net (loss) income attributable to controlling interests per common share-basic (in dollars per share) | $ / shares | $ (0.34) | $ 0.05 | |||||
Net (loss) income attributable to controlling interests per common share-diluted (in dollars per share) | $ / shares | $ (0.34) | $ 0.05 | |||||
Five Point Eight Seven Five Percent Convertible Senior Notes Due Two Thousand Thirty Five [Member] | |||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||
Debt Instrument, Convertible, Number of Equity Instruments | 3,600,000 | ||||||
Denominator: | |||||||
Incremental Common Shares Attributable to Conversion of Debt Securities | 0 | ||||||
|
Net Income (Loss) Attributable to Controlling Interests Per Common Share Antidilutive Securities (Details) |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2018
shares
$ / shares
|
Mar. 31, 2017
shares
|
Nov. 30, 2005 |
May 31, 2005 |
|
Debt Instrument [Line Items] | ||||
Weighted Average Number of Shares, Restricted Stock | 184,196 | 345,385 | ||
5.875% Convertible Senior Notes Due 2035 [Member] | ||||
Debt Instrument [Line Items] | ||||
Shares potentially issuable and includible in diluted net loss attributable to controlling interest per common share | 0 | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.875% | 5.875% | ||
Conversion price for convertible senior notes | $ / shares | $ 24.61 | |||
Debt Instrument, Convertible, Number of Equity Instruments | 3,600,000 |
Stock-Based Compensation (Details) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018
USD ($)
stock_compensation_plan
$ / shares
shares
|
Mar. 31, 2017
USD ($)
shares
|
Dec. 31, 2017
USD ($)
$ / shares
shares
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $ | $ 700,000 | $ 900,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | shares | 2,614,667 | 2,619,334 | |
Number of stock based compensation plans | stock_compensation_plan | 2 | ||
Employee Stock purchase plan, shares authorized | shares | 103,702 | ||
Maximum aggregate number of shares of common stock issued | shares | 1,024,515 | ||
Adjustments to Additional Paid in Capital, Share-based Compensation and Exercise of Stock Options | $ | $ 0 | $ 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ / shares | $ 3.04 | $ 3.04 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | shares | 0 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares | $ 0.00 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | shares | 0 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ / shares | $ 0.00 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period | shares | 4,667 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price | $ / shares | $ 3.04 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 3 years 1 month | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ | $ 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | shares | 1,010,815 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ / shares | $ 2.95 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | 2 years 1 month | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value | $ | $ 0 | ||
Document Period End Date | Mar. 31, 2018 | ||
Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | shares | 69,000 | 57,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ | $ 200,000 | $ 200,000 | |
Allocated Share-based Compensation Expense | $ | 100,000 | 200,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | $ | $ 200,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 5 months | ||
Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Allocated Share-based Compensation Expense | $ | $ 182,000 | $ 309,000 | |
Maximum [Member] | Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 60 months | ||
Maximum [Member] | Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 10 years | ||
Minimum [Member] | Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 12 months |
Property (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 31, 2017 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Property at cost, net of depreciation | $ 3,021 | $ 3,229 |
Income Taxes (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2018
Rate
|
Mar. 31, 2017
Rate
|
|
Income Tax [Abstract] | ||
Effective Income Tax Rate Reconciliation, Percent | 3.10% | 45.90% |
Income Taxes Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Schedule of Components of Income Tax Expense (Benefit) [Abstract] | ||
Income Tax Expense (Benefit) | $ (144) | $ (618) |
Income Taxes Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Mar. 31, 2017 |
|
Schedule of Effective Income Tax Rate Reconciliation [Abstract] | ||
Effective Income Tax Rate Reconciliation, Percent | 3.10% | 45.90% |
Unrecognized Tax Benefits, Income Tax Penalties Expense | $ (0.2) | |
Income tax settlement amount with taxing authority | $ 7.4 | |
Income Tax Examination, Interest Accrued | $ 4.3 |
Related Party Transactions (Details) - USD ($) $ in Thousands |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 31, 2018 |
Dec. 31, 2017 |
||||
Related Party Transaction [Line Items] | |||||
Notes Payable, Related Parties | $ 40,000 | $ 40,000 | |||
Related Party Transaction [Domain] | |||||
Related Party Transaction [Line Items] | |||||
Notes Payable, Related Party Max Facility Limit | 40,000 | ||||
Senior Secured Term Loan, Expiring 2018 [Domain] | |||||
Related Party Transaction [Line Items] | |||||
Notes Payable, Related Parties | [1] | $ 40,000 | $ 40,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | [1] | 9.00% | 9.00% | ||
Related Party Transaction, Date | [1] | Nov. 21, 2018 | |||
|
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