QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | ||
(Address of principal executive offices) | (Zip Code) |
Not Applicable | ||
(Former name, former address and former fiscal year, if changed since last report) |
Title of each class | Trading symbol(s) | Name of each exchange on which registered | |||
þ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | Emerging growth company |
PART I. — FINANCIAL INFORMATION | |
ITEM 1. FINANCIAL STATEMENTS | |
Consolidated Balance Sheets - As of September 30, 2019 and December 31, 2018 | |
Consolidated Statements of Income - Three and nine months ended September 30, 2019 and 2018 | |
Consolidated Statements of Comprehensive Income - Three and nine months ended September 30, 2019 and 2018 | |
Consolidated Statements of Shareholders' Equity - Three and nine months ended September 30, 2019 and 2018 | |
Consolidated Statements of Cash Flows - Nine months ended September 30, 2019 and 2018 | |
PART II. — OTHER INFORMATION | |
ITEM 1. LEGAL PROCEEDINGS | |
ITEM 6. EXHIBITS | |
SIGNATURES |
(Dollars in millions, except per share data) | As of | ||||||
September 30, 2019 | December 31, 2018 | ||||||
ASSETS: | |||||||
Cash and cash equivalents | $ | $ | |||||
Restricted cash and cash equivalents | |||||||
Restricted securities available for sale | |||||||
Loans receivable | |||||||
Allowance for credit losses | ( | ) | ( | ) | |||
Loans receivable, net | |||||||
Property and equipment, net | |||||||
Income taxes receivable | |||||||
Other assets | |||||||
Total Assets | $ | $ | |||||
LIABILITIES AND SHAREHOLDERS' EQUITY: | |||||||
Liabilities: | |||||||
Accounts payable and accrued liabilities | $ | $ | |||||
Revolving secured line of credit | |||||||
Secured financing | |||||||
Senior notes | |||||||
Mortgage note | |||||||
Deferred income taxes, net | |||||||
Income taxes payable | |||||||
Total Liabilities | |||||||
Commitments and Contingencies - See Note 15 | |||||||
Shareholders' Equity: | |||||||
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued | |||||||
Common stock, $0.01 par value, 80,000,000 shares authorized, 18,796,770 and 18,972,558 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively | |||||||
Paid-in capital | |||||||
Retained earnings | |||||||
Accumulated other comprehensive income (loss) | ( | ) | |||||
Total Shareholders' Equity | |||||||
Total Liabilities and Shareholders' Equity | $ | $ |
(Dollars in millions, except per share data) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenue: | |||||||||||||||
Finance charges | $ | $ | $ | $ | |||||||||||
Premiums earned | |||||||||||||||
Other income | |||||||||||||||
Total revenue | |||||||||||||||
Costs and expenses: | |||||||||||||||
Salaries and wages | |||||||||||||||
General and administrative | |||||||||||||||
Sales and marketing | |||||||||||||||
Provision for credit losses | |||||||||||||||
Interest | |||||||||||||||
Provision for claims | |||||||||||||||
Total costs and expenses | |||||||||||||||
Income before provision for income taxes | |||||||||||||||
Provision for income taxes | |||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||
Net income per share: | |||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||
Diluted | $ | $ | $ | $ | |||||||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | |||||||||||||||
Diluted |
(In millions) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net income | $ | $ | $ | $ | |||||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||
Unrealized gain (loss) on securities, net of tax | ( | ) | |||||||||||||
Other comprehensive income (loss) | ( | ) | |||||||||||||
Comprehensive income | $ | $ | $ | $ |
(Dollars in millions) | For the Three Months Ended September 30, 2019 | |||||||||||||||||||||
Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' Equity | ||||||||||||||||||
Number | Amount | |||||||||||||||||||||
Balance, beginning of period | $ | $ | $ | $ | $ | |||||||||||||||||
Net income | — | |||||||||||||||||||||
Other comprehensive income | — | |||||||||||||||||||||
Stock-based compensation | — | |||||||||||||||||||||
Restricted stock awards, net of forfeitures | ( | ) | — | — | — | — | — | |||||||||||||||
Balance, end of period | $ | $ | $ | $ | $ | |||||||||||||||||
(Dollars in millions) | For the Three Months Ended September 30, 2018 | |||||||||||||||||||||
Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' Equity | ||||||||||||||||||
Number | Amount | |||||||||||||||||||||
Balance, beginning of period | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||
Net income | — | |||||||||||||||||||||
Other comprehensive loss | — | |||||||||||||||||||||
Stock-based compensation | — | |||||||||||||||||||||
Restricted stock awards, net of forfeitures | ( | ) | — | — | — | — | — | |||||||||||||||
Balance, end of period | $ | $ | $ | $ | ( | ) | $ |
(Dollars in millions) | For the Nine Months Ended September 30, 2019 | |||||||||||||||||||||
Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' Equity | ||||||||||||||||||
Number | Amount | |||||||||||||||||||||
Balance, beginning of period | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||
Net income | — | |||||||||||||||||||||
Other comprehensive income | — | |||||||||||||||||||||
Stock-based compensation | — | |||||||||||||||||||||
Restricted stock awards, net of forfeitures | — | — | — | — | — | |||||||||||||||||
Repurchase of common stock | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Restricted stock units converted to common stock | — | — | — | — | — | |||||||||||||||||
Balance, end of period | $ | $ | $ | $ | $ | |||||||||||||||||
(Dollars in millions) | For the Nine Months Ended September 30, 2018 | |||||||||||||||||||||
Common Stock | Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' Equity | ||||||||||||||||||
Number | Amount | |||||||||||||||||||||
Balance, beginning of period | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||
Net income | — | |||||||||||||||||||||
Other comprehensive income | — | ( | ) | ( | ) | |||||||||||||||||
Stock-based compensation | — | |||||||||||||||||||||
Restricted stock awards, net of forfeitures | — | — | — | — | — | |||||||||||||||||
Repurchase of common stock | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
Restricted stock units converted to common stock | — | — | — | — | — | |||||||||||||||||
Balance, end of period | $ | $ | $ | $ | ( | ) | $ |
(In millions) | For the Nine Months Ended September 30, | ||||||
2019 | 2018 | ||||||
Cash Flows From Operating Activities: | |||||||
Net income | $ | $ | |||||
Adjustments to reconcile cash provided by operating activities: | |||||||
Provision for credit losses | |||||||
Depreciation | |||||||
Amortization | |||||||
Provision for deferred income taxes | |||||||
Stock-based compensation | |||||||
Other | ( | ) | |||||
Change in operating assets and liabilities: | |||||||
Increase (decrease) in accounts payable and accrued liabilities | ( | ) | |||||
Increase in income taxes receivable | ( | ) | ( | ) | |||
Decrease in income taxes payable | ( | ) | ( | ) | |||
Decrease in other assets | |||||||
Net cash provided by operating activities | |||||||
Cash Flows From Investing Activities: | |||||||
Purchases of restricted securities available for sale | ( | ) | ( | ) | |||
Proceeds from sale of restricted securities available for sale | |||||||
Maturities of restricted securities available for sale | |||||||
Principal collected on Loans receivable | |||||||
Advances to Dealers | ( | ) | ( | ) | |||
Purchases of Consumer Loans | ( | ) | ( | ) | |||
Accelerated payments of Dealer Holdback | ( | ) | ( | ) | |||
Payments of Dealer Holdback | ( | ) | ( | ) | |||
Purchases of property and equipment | ( | ) | ( | ) | |||
Net cash used in investing activities | ( | ) | ( | ) | |||
Cash Flows From Financing Activities: | |||||||
Borrowings under revolving secured line of credit | |||||||
Repayments under revolving secured line of credit | ( | ) | ( | ) | |||
Proceeds from secured financing | |||||||
Repayments of secured financing | ( | ) | ( | ) | |||
Proceeds from issuance of senior notes | |||||||
Proceeds from mortgage note | |||||||
Payments of debt issuance costs | ( | ) | ( | ) | |||
Repurchase of common stock | ( | ) | ( | ) | |||
Other | ( | ) | ( | ) | |||
Net cash provided by financing activities | |||||||
Net increase in cash and cash equivalents and restricted cash and cash equivalents | |||||||
Cash and cash equivalents and restricted cash and cash equivalents beginning of period | |||||||
Cash and cash equivalents and restricted cash and cash equivalents end of period | $ | $ | |||||
Supplemental Disclosure of Cash Flow Information: | |||||||
Cash paid during the period for interest | $ | $ | |||||
Cash paid during the period for income taxes | $ | $ |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||
Consumer Loan Assignment Volume | 2019 | 2018 | 2019 | 2018 | ||||||||
Percentage of total unit volume with either FICO® scores below 650 or no FICO® scores | % | % | % | % |
Unit Volume | Dollar Volume (1) | |||||||||||
Three Months Ended | Dealer Loans | Purchased Loans | Dealer Loans | Purchased Loans | ||||||||
March 31, 2018 | % | % | % | % | ||||||||
June 30, 2018 | % | % | % | % | ||||||||
September 30, 2018 | % | % | % | % | ||||||||
December 31, 2018 | % | % | % | % | ||||||||
March 31, 2019 | % | % | % | % | ||||||||
June 30, 2019 | % | % | % | % | ||||||||
September 30, 2019 | % | % | % | % |
(1) | Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. Payments of Dealer Holdback (as defined below) and accelerated Dealer Holdback are not included. |
• | a down payment from the consumer; |
• | a non-recourse cash payment (“advance”) from us; and |
• | after the advance balance (cash advance and related Dealer Loan fees and costs) has been recovered by us, the cash from payments made on the Consumer Loan, net of certain collection costs and our servicing fee (“Dealer Holdback”). |
• | first, to reimburse us for certain collection costs; |
• | second, to pay us our servicing fee, which generally equals |
• | third, to reduce the aggregate advance balance and to pay any other amounts due from the Dealer to us; and |
• | fourth, to the Dealer as payment of Dealer Holdback. |
• | assigned at least |
• | franchise dealership; or |
• | independent dealership that meets certain criteria upon enrollment. |
(In millions) | As of | ||||||||||||||
September 30, 2019 | December 31, 2018 | September 30, 2018 | December 31, 2017 | ||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | |||||||||||
Restricted cash and cash equivalents | |||||||||||||||
Total cash and cash equivalents and restricted cash and cash equivalents | $ | $ | $ | $ |
• | the consumer and Dealer have signed a Consumer Loan contract; and |
• | we have received the executed Consumer Loan contract and supporting documentation in either physical or electronic form. |
• | the Consumer Loan has been legally assigned to us; and |
• | we have made a funding decision and generally have provided funding to the Dealer in the form of either an advance under the Portfolio Program or one-time purchase payment under the Purchase Program. |
• | the aggregate amount of all cash advances paid; |
• | finance charges; |
• | Dealer Holdback payments; |
• | accelerated Dealer Holdback payments; and |
• | recoveries. |
• | collections (net of certain collection costs); |
• | write-offs; and |
• | transfers. |
• | the aggregate amount of all amounts paid during the month of purchase to purchase Consumer Loans from Dealers; |
• | finance charges; |
• | recoveries; and |
• | transfers. |
• | collections (net of certain collection costs); and |
• | write-offs. |
• | We have a variable interest in the trust. We have a residual interest in the assets of the trust, which is variable in nature, given that it increases or decreases based upon the actual loss experience of the related service contracts. In addition, VSC Re is required to absorb any losses in excess of the trust's assets. |
• | The trust is a variable interest entity. The trust has insufficient equity at risk as no parties to the trust were required to contribute assets that provide them with any ownership interest. |
• | We are the primary beneficiary of the trust. We control the amount of premiums written and placed in the trust through Consumer Loan assignments under our Programs, which is the activity that most significantly impacts the economic performance of the trust. We have the right to receive benefits from the trust that could potentially be significant. In addition, VSC Re has the obligation to absorb losses of the trust that could potentially be significant. |
• | calculate an effective interest rate based on expected future net cash flows; and |
• | increase the Loans receivable and related allowance for credit losses balances by the present value of the difference between contractual future net cash flows and expected future net cash flows discounted at the effective interest rate. This “gross-up” will not impact the net carrying amount of Loans (Loans receivable less allowance for credit losses) or net income. |
• | recognize finance charge revenue using the effective interest rate that was calculated on the adoption date based on expected future net cash flows; and |
• | adjust the allowance for credit losses so that the net carrying amount of each Loan equals the present value of expected future net cash flows discounted at the effective interest rate. The adjustment to the allowance for credit losses will be recognized as either provision for credit losses expense or a reversal of provision for credit losses expense. |
• | calculate the effective interest rate based on contractual future net cash flows; and |
• | record an allowance for credit losses equal to the difference between the initial balance of the Loan (advance or purchase amount) and the present value of expected future net cash flows discounted at the effective interest rate. The initial allowance for credit losses will be recognized as provision for credit losses expense. |
• | recognize finance charge revenue using the effective interest rate that was calculated at the time of assignment based on contractual future net cash flows; and |
• | adjust the allowance for credit losses so that the net carrying amount of each Loan equals the present value of expected future net cash flows discounted at the effective interest rate. The adjustment to the allowance for credit losses will be recognized as either provision for credit losses expense or a reversal of provision for credit losses expense. |
• | the effective interest rate will be significantly inflated for contractual amounts that were not expected to be collected at the time of assignment; and |
• | the provision for credit losses expense recognized at the time of assignment does not represent an economic loss to us. |
• | We want to minimize volatility in our reported results related to a changing interest rate environment. In addition, we believe the election of the fair value option could materially adversely affect our financial position, liquidity and results of operations in a financial crisis period due to the impact of rapidly increasing market participant discount rates on fair value. |
• | We have modified our revolving secured line of credit and warehouse facilities so that the adoption of CECL will not materially impact the amount we are able to borrow under these facilities or materially impact our ability to comply with the financial covenants in these facilities. We believe that we will be able to structure our Term ABS financings issued after the adoption of CECL so that the amount that we will be able to borrow will not be materially impacted. |
• | We believe we will be able to quantify and explain to shareholders how CECL diverges from economic reality. |
(In millions) | As of September 30, 2019 | As of December 31, 2018 | |||||||||||||
Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||
Assets | |||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | |||||||||||
Restricted cash and cash equivalents | |||||||||||||||
Restricted securities available for sale | |||||||||||||||
Loans receivable, net | |||||||||||||||
Liabilities | |||||||||||||||
Revolving secured line of credit | $ | $ | $ | $ | |||||||||||
Secured financing | |||||||||||||||
Senior notes | |||||||||||||||
Mortgage note |
Level 1 | Valuation is based upon quoted prices for identical instruments traded in active markets. |
Level 2 | Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. |
Level 3 | Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates or assumptions that market participants would use in pricing the asset or liability. |
(In millions) | As of September 30, 2019 | ||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair Value | ||||||||||||
Assets | |||||||||||||||
Cash and cash equivalents (1) | $ | $ | — | $ | — | $ | |||||||||
Restricted cash and cash equivalents (1) | — | — | |||||||||||||
Restricted securities available for sale (2) | — | ||||||||||||||
Loans receivable, net (1) | — | — | |||||||||||||
Liabilities | |||||||||||||||
Revolving secured line of credit (1) | $ | — | $ | $ | — | $ | |||||||||
Secured financing (1) | — | — | |||||||||||||
Senior notes (1) | — | — | |||||||||||||
Mortgage note (1) | — |
(In millions) | As of December 31, 2018 | ||||||||||||||
Level 1 | Level 2 | Level 3 | Total Fair Value | ||||||||||||
Assets | |||||||||||||||
Cash and cash equivalents (1) | $ | $ | — | $ | — | $ | |||||||||
Restricted cash and cash equivalents (1) | — | — | |||||||||||||
Restricted securities available for sale (2) | — | ||||||||||||||
Loans receivable, net (1) | — | — | |||||||||||||
Liabilities | |||||||||||||||
Revolving secured line of credit (1) | $ | — | $ | $ | — | $ | |||||||||
Secured financing (1) | — | — | |||||||||||||
Senior notes (1) | — | — | |||||||||||||
Mortgage note (1) | — |
(1) | Measured at amortized cost with fair value disclosed. |
(2) |
(In millions) | As of September 30, 2019 | ||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
Corporate bonds | $ | $ | $ | $ | |||||||||||
U.S. Government and agency securities | |||||||||||||||
Asset-backed securities | |||||||||||||||
Mortgage-backed securities | |||||||||||||||
Total restricted securities available for sale | $ | $ | $ | $ | |||||||||||
(In millions) | As of December 31, 2018 | ||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
Corporate bonds | $ | $ | $ | ( | ) | $ | |||||||||
U.S. Government and agency securities | ( | ) | |||||||||||||
Asset-backed securities | ( | ) | |||||||||||||
Mortgage-backed securities | |||||||||||||||
Total restricted securities available for sale | $ | $ | $ | ( | ) | $ |
(In millions) | Securities Available for Sale with Gross Unrealized Losses as of September 30, 2019 | ||||||||||||||||||||||
Less than 12 Months | 12 Months or More | ||||||||||||||||||||||
Estimated Fair Value | Gross Unrealized Losses | Estimated Fair Value | Gross Unrealized Losses | Total Estimated Fair Value | Total Gross Unrealized Losses | ||||||||||||||||||
Corporate bonds | $ | $ | $ | $ | $ | $ | |||||||||||||||||
U.S. Government and agency securities | |||||||||||||||||||||||
Asset-backed securities | — | ||||||||||||||||||||||
Mortgage-backed securities | — | — | |||||||||||||||||||||
Total restricted securities available for sale | $ | $ | $ | $ | $ | $ |
(In millions) | Securities Available for Sale with Gross Unrealized Losses as of December 31, 2018 | ||||||||||||||||||||||
Less than 12 Months | 12 Months or More | ||||||||||||||||||||||
Estimated Fair Value | Gross Unrealized Losses | Estimated Fair Value | Gross Unrealized Losses | Total Estimated Fair Value | Total Gross Unrealized Losses | ||||||||||||||||||
Corporate bonds | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) | |||||||||||
U.S. Government and agency securities | ( | ) | ( | ) | |||||||||||||||||||
Asset-backed securities | — | ( | ) | ( | ) | ||||||||||||||||||
Mortgage-backed securities | — | — | |||||||||||||||||||||
Total restricted securities available for sale | $ | $ | ( | ) | $ | $ | ( | ) | $ | $ | ( | ) |
(In millions) | As of | |||||||||||||||
September 30, 2019 | December 31, 2018 | |||||||||||||||
Contractual Maturity | Amortized Cost | Estimated Fair Value | Amortized Cost | Estimated Fair Value | ||||||||||||
Within one year | $ | $ | $ | $ | ||||||||||||
Over one year to five years | ||||||||||||||||
Over five years to ten years | ||||||||||||||||
Over ten years | ||||||||||||||||
Total restricted securities available for sale | $ | $ | $ | $ |
(In millions) | As of September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Loans receivable | $ | $ | $ | ||||||||
Allowance for credit losses | ( | ) | ( | ) | ( | ) | |||||
Loans receivable, net | $ | $ | $ | ||||||||
(In millions) | As of December 31, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Loans receivable | $ | $ | $ | ||||||||
Allowance for credit losses | ( | ) | ( | ) | ( | ) | |||||
Loans receivable, net | $ | $ | $ |
(In millions) | For the Three Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Principal collected on Loans receivable | ( | ) | ( | ) | ( | ) | |||||
Accelerated Dealer Holdback payments | — | ||||||||||
Dealer Holdback payments | — | ||||||||||
Transfers (2) | ( | ) | — | ||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (3) | |||||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Three Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Principal collected on Loans receivable | ( | ) | ( | ) | ( | ) | |||||
Accelerated Dealer Holdback payments | — | ||||||||||
Dealer Holdback payments | — | ||||||||||
Transfers (2) | ( | ) | — | ||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (3) | |||||||||||
Balance, end of period | $ | $ | $ |
(In millions) | For the Nine Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Principal collected on Loans receivable | ( | ) | ( | ) | ( | ) | |||||
Accelerated Dealer Holdback payments | — | ||||||||||
Dealer Holdback payments | — | ||||||||||
Transfers (2) | ( | ) | — | ||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (3) | |||||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Nine Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Principal collected on Loans receivable | ( | ) | ( | ) | ( | ) | |||||
Accelerated Dealer Holdback payments | — | ||||||||||
Dealer Holdback payments | — | ||||||||||
Transfers (2) | ( | ) | — | ||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (3) | |||||||||||
Balance, end of period | $ | $ | $ |
(1) | The Dealer Loans amount represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program. The Purchased Loans amount represents one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. |
(2) | Under our Portfolio Program, certain events may result in Dealers forfeiting their rights to Dealer Holdback. We transfer the Dealer’s outstanding Dealer Loan balance and the related allowance for credit losses balance to Purchased Loans in the period this forfeiture occurs. |
(3) | Represents collections received on previously written off Loans. |
(In millions) | For the Three Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Accretion (2) | ( | ) | ( | ) | ( | ) | |||||
Provision for credit losses | |||||||||||
Forecast changes | ( | ) | |||||||||
Transfers (3) | ( | ) | |||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Three Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Accretion (2) | ( | ) | ( | ) | ( | ) | |||||
Provision for credit losses | |||||||||||
Forecast changes | ( | ) | |||||||||
Transfers (3) | ( | ) | |||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Nine Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Accretion (2) | ( | ) | ( | ) | ( | ) | |||||
Provision for credit losses | |||||||||||
Forecast changes | ( | ) | |||||||||
Transfers (3) | ( | ) | |||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Nine Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
New Consumer Loan assignments (1) | |||||||||||
Accretion (2) | ( | ) | ( | ) | ( | ) | |||||
Provision for credit losses | |||||||||||
Forecast changes | |||||||||||
Transfers (3) | ( | ) | |||||||||
Balance, end of period | $ | $ | $ |
(1) | The Dealer Loans amount represents the net cash flows expected at the time of assignment on Consumer Loans assigned under our Portfolio Program, less the related advances paid to Dealers. The Purchased Loans amount represents the net cash flows expected at the time of assignment on Consumer Loans assigned under our Purchase Program, less the related one-time payments made to Dealers. |
(2) | Represents finance charges excluding the amortization of deferred direct origination costs for Dealer Loans. |
(3) | Under our Portfolio Program, certain events may result in Dealers forfeiting their rights to Dealer Holdback. We transfer the Dealer’s outstanding Dealer Loan balance, the related allowance for credit losses balance and related expected future net cash flows to Purchased Loans in the period this forfeiture occurs. |
(In millions) | For the Three Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Contractual net cash flows at the time of assignment (1) | $ | $ | $ | ||||||||
Expected net cash flows at the time of assignment (2) | |||||||||||
Fair value at the time of assignment (3) | |||||||||||
(In millions) | For the Three Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Contractual net cash flows at the time of assignment (1) | $ | $ | $ | ||||||||
Expected net cash flows at the time of assignment (2) | |||||||||||
Fair value at the time of assignment (3) | |||||||||||
(In millions) | For the Nine Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Contractual net cash flows at the time of assignment (1) | $ | $ | $ | ||||||||
Expected net cash flows at the time of assignment (2) | |||||||||||
Fair value at the time of assignment (3) | |||||||||||
(In millions) | For the Nine Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Contractual net cash flows at the time of assignment (1) | $ | $ | $ | ||||||||
Expected net cash flows at the time of assignment (2) | |||||||||||
Fair value at the time of assignment (3) |
(1) | The Dealer Loans amount represents the repayments that we were contractually owed at the time of assignment on Consumer Loans assigned under our Portfolio Program, less the related Dealer Holdback payments that we would be required to make if we collected all of the contractual repayments. The Purchased Loans amount represents the repayments that we were contractually owed at the time of assignment on Consumer Loans assigned under our Purchase Program. |
(2) | The Dealer Loans amount represents the repayments that we expected to collect at the time of assignment on Consumer Loans assigned under our Portfolio Program, less the related Dealer Holdback payments that we expected to make. The Purchased Loans amount represents the repayments that we expected to collect at the time of assignment on Consumer Loans assigned under our Purchase Program. |
(3) | The Dealer Loans amount represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program. The Purchased Loans amount represents one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. |
Forecasted Collection Percentage as of (1) | Current Forecast Variance from | ||||||||||||||||||||
Consumer Loan Assignment Year | September 30, 2019 | June 30, 2019 | December 31, 2018 | Initial Forecast | June 30, 2019 | December 31, 2018 | Initial Forecast | ||||||||||||||
2010 | % | % | % | % | % | % | % | ||||||||||||||
2011 | % | % | % | % | % | % | % | ||||||||||||||
2012 | % | % | % | % | % | % | % | ||||||||||||||
2013 | % | % | % | % | % | % | % | ||||||||||||||
2014 | % | % | % | % | % | % | % | ||||||||||||||
2015 | % | % | % | % | % | % | - | % | |||||||||||||
2016 | % | % | % | % | - | % | - | % | - | % | |||||||||||
2017 | % | % | % | % | - | % | - | % | % | ||||||||||||
2018 | % | % | % | % | - | % | % | % | |||||||||||||
2019 (2) | % | % | — | % | % | — | % |
(1) | Represents the total forecasted collections we expect to collect on the Consumer Loans as a percentage of the repayments that we were contractually owed on the Consumer Loans at the time of assignment. Contractual repayments include both principal and interest. Forecasted collection rates are negatively impacted by canceled Consumer Loans as the contractual amount owed is not removed from the denominator for purposes of computing forecasted collection rates in the table. |
(2) | The forecasted collection rate for 2019 Consumer Loans as of September 30, 2019 includes both Consumer Loans that were in our portfolio as of June 30, 2019 and Consumer Loans assigned during the most recent quarter. The following table provides forecasted collection rates for each of these segments: |
Forecasted Collection Percentage as of | Current Forecast Variance from | ||||||||||||||
2019 Consumer Loan Assignment Period | September 30, 2019 | June 30, 2019 | Initial Forecast | June 30, 2019 | Initial Forecast | ||||||||||
January 1, 2019 through June 30, 2019 | % | % | % | % | % | ||||||||||
July 1, 2019 through September 30, 2019 | % | — | % | — | % |
(In millions) | As of September 30, 2019 | ||||||||||||||||||||||
Loan Pool Performance Meets or Exceeds Initial Estimates | Loan Pool Performance Less than Initial Estimates | ||||||||||||||||||||||
Dealer Loans | Purchased Loans | Total | Dealer Loans | Purchased Loans | Total | ||||||||||||||||||
Loans receivable | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Allowance for credit losses | — | — | — | ( | ) | ( | ) | ( | ) | ||||||||||||||
Loans receivable, net | $ | $ | $ | $ | $ | $ | |||||||||||||||||
(In millions) | As of December 31, 2018 | ||||||||||||||||||||||
Loan Pool Performance Meets or Exceeds Initial Estimates | Loan Pool Performance Less than Initial Estimates | ||||||||||||||||||||||
Dealer Loans | Purchased Loans | Total | Dealer Loans | Purchased Loans | Total | ||||||||||||||||||
Loans receivable | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Allowance for credit losses | — | — | — | ( | ) | ( | ) | ( | ) | ||||||||||||||
Loans receivable, net | $ | $ | $ | $ | $ | $ |
(In millions) | For the Three Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
Provision for credit losses | |||||||||||
Transfers (1) | ( | ) | |||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (2) | |||||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Three Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
Provision for credit losses | |||||||||||
Transfers (1) | ( | ) | |||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (2) | |||||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Nine Months Ended September 30, 2019 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
Provision for credit losses | |||||||||||
Transfers (1) | ( | ) | |||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (2) | |||||||||||
Balance, end of period | $ | $ | $ | ||||||||
(In millions) | For the Nine Months Ended September 30, 2018 | ||||||||||
Dealer Loans | Purchased Loans | Total | |||||||||
Balance, beginning of period | $ | $ | $ | ||||||||
Provision for credit losses | |||||||||||
Transfers (1) | ( | ) | |||||||||
Write-offs | ( | ) | ( | ) | ( | ) | |||||
Recoveries (2) | |||||||||||
Balance, end of period | $ | $ | $ |
(1) | Under our Portfolio Program, certain events may result in Dealers forfeiting their rights to Dealer Holdback. We transfer the Dealer’s outstanding Dealer Loan balance and the related allowance for credit losses balance to Purchased Loans in the period this forfeiture occurs. |
(2) |
(In millions) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Net assumed written premiums | $ | $ | $ | $ | |||||||||||
Net premiums earned | |||||||||||||||
Provision for claims | |||||||||||||||
Amortization of capitalized acquisition costs |
(In millions) | As of | ||||||||
Balance Sheet location | September 30, 2019 | December 31, 2018 | |||||||
Trust assets | Restricted cash and cash equivalents | $ | $ | ||||||
Trust assets | Restricted securities available for sale | ||||||||
Unearned premium | Accounts payable and accrued liabilities | ||||||||
Claims reserve (1) | Accounts payable and accrued liabilities |
(1) | The claims reserve represents our liability for incurred-but-not-reported claims and is estimated based on historical claims experience. |
(In millions) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Ancillary product profit sharing | $ | $ | $ | $ | |||||||||||
Remarketing fees | |||||||||||||||
Interest | |||||||||||||||
Dealer enrollment fees | |||||||||||||||
Dealer support products and services | |||||||||||||||
GPS-SID fees | |||||||||||||||
Other | |||||||||||||||
Total | $ | $ | $ | $ |
(In millions) | For the Three Months Ended September 30, 2019 | ||||||||||||||||||||||||||||||
Ancillary product profit sharing | Remarketing fees | Interest | Dealer enrollment fees | Dealer support products and services | GPS-SID fees | Other | Total Other Income | ||||||||||||||||||||||||
Source of income | |||||||||||||||||||||||||||||||
Third Party Providers | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Dealers | |||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Timing of revenue recognition | |||||||||||||||||||||||||||||||
Over time | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
At a point in time | |||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ |
(In millions) | For the Nine Months Ended September 30, 2019 | ||||||||||||||||||||||||||||||
Ancillary product profit sharing | Remarketing fees | Interest | Dealer enrollment fees | Dealer support products and services | GPS-SID fees | Other | Total Other Income | ||||||||||||||||||||||||
Source of income | |||||||||||||||||||||||||||||||
Third Party Providers | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Dealers | |||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
Timing of revenue recognition | |||||||||||||||||||||||||||||||
Over time | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||
At a point in time | |||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ |
(In millions) | As of September 30, 2019 | |||||||||||||||
Principal Outstanding | Unamortized Debt Issuance Costs | Unamortized Discount | Carrying Amount | |||||||||||||
Revolving secured line of credit (1) | $ | $ | $ | $ | ||||||||||||
Secured financing (2) | ( | ) | ||||||||||||||
Senior notes | ( | ) | ( | ) | ||||||||||||
Mortgage note | ||||||||||||||||
Total debt | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||
(In millions) | As of December 31, 2018 | |||||||||||||||
Principal Outstanding | Unamortized Debt Issuance Costs | Unamortized Discount | Carrying Amount | |||||||||||||
Revolving secured line of credit (1) | $ | $ | $ | $ | ||||||||||||
Secured financing (2) | ( | ) | ||||||||||||||
Senior notes | ( | ) | ( | ) | ||||||||||||
Mortgage note | ||||||||||||||||
Total debt | $ | $ | ( | ) | $ | ( | ) | $ |
(1) | Excludes deferred debt issuance costs of $ |
(2) | Warehouse facilities and Term ABS. |
(Dollars in millions) | |||||||||||
Financings | Wholly-owned Subsidiary | Maturity Date | Financing Amount | Interest Rate as of September 30, 2019 | |||||||
Revolving Secured Line of Credit | $ | At our option, either LIBOR plus 187.5 basis points or the prime rate plus 87.5 basis points | |||||||||
Warehouse Facility II (1) | (2) | LIBOR plus 175 basis points (3) | |||||||||
Warehouse Facility IV (1) | (2) | LIBOR plus 200 basis points (3) | |||||||||
Warehouse Facility V (1) | (4) | LIBOR plus 190 basis points (3) | |||||||||
Warehouse Facility VI (1) | (2) | LIBOR plus 200 basis points | |||||||||
Warehouse Facility VII (1) | (5) | Commercial paper rate plus 200 basis points (3) | |||||||||
Warehouse Facility VIII (1) | (2) | LIBOR plus 190 basis points (3) | |||||||||
Term ABS 2016-3 (1) | (2) | Fixed rate | |||||||||
Term ABS 2017-1 (1) | (2) | Fixed rate | |||||||||
Term ABS 2017-2 (1) | (2) | Fixed rate | |||||||||
Term ABS 2017-3 (1) | (2) | Fixed rate | |||||||||
Term ABS 2018-1 (1) | (2) | Fixed rate | |||||||||
Term ABS 2018-2 (1) | (2) | Fixed rate | |||||||||
Term ABS 2018-3 (1) | (2) | Fixed rate | |||||||||
Term ABS 2019-1 (1) | (2) | Fixed rate | |||||||||
Term ABS 2019-2 (1) | (6) | Fixed rate | |||||||||
2021 Senior Notes | Fixed rate | ||||||||||
2023 Senior Notes | Fixed rate | ||||||||||
2026 Senior Notes | Fixed rate | ||||||||||
Mortgage Note | LIBOR plus 150 basis points |
(1) | Financing made available only to a specified subsidiary of the Company. |
(2) |
(3) |
(4) | Represents the revolving maturity date. The outstanding balance will amortize after the revolving maturity date and any amounts remaining on August 17, 2023 will be due on that date. |
(5) | Represents the revolving maturity date. The outstanding balance will amortize after the revolving maturity date and any amounts remaining on December 17, 2022 will be due on that date. |
(6) | Represents the revolving maturity date. The Company has the option to redeem and retire the indebtedness after the revolving maturity date. If we do not elect this option, the outstanding balance will amortize based on the cash flows of the pledged assets. |
(In millions) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revolving Secured Line of Credit | |||||||||||||||
Maximum outstanding principal balance | $ | $ | $ | $ | |||||||||||
Average outstanding principal balance | |||||||||||||||
Warehouse Facility II | |||||||||||||||
Maximum outstanding principal balance | |||||||||||||||
Average outstanding principal balance | |||||||||||||||
Warehouse Facility IV | |||||||||||||||
Maximum outstanding principal balance | |||||||||||||||
Average outstanding principal balance | |||||||||||||||
Warehouse Facility V | |||||||||||||||
Maximum outstanding principal balance | |||||||||||||||
Average outstanding principal balance | |||||||||||||||
Warehouse Facility VI | |||||||||||||||
Maximum outstanding principal balance | |||||||||||||||
Average outstanding principal balance | |||||||||||||||
Warehouse Facility VII | |||||||||||||||
Maximum outstanding principal balance | |||||||||||||||
Average outstanding principal balance | |||||||||||||||
Warehouse Facility VIII | |||||||||||||||
Maximum outstanding principal balance | |||||||||||||||
Average outstanding principal balance |
(Dollars in millions) | As of | ||||||
September 30, 2019 | December 31, 2018 | ||||||
Revolving Secured Line of Credit | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Interest rate | % | % | |||||
Warehouse Facility II | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Warehouse Facility IV | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Warehouse Facility V | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Warehouse Facility VI | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Loans pledged as collateral | — | ||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Warehouse Facility VII | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Warehouse Facility VIII | |||||||
Principal balance outstanding | $ | $ | |||||
Amount available for borrowing (1) | |||||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2016-1 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % |
Term ABS 2016-2 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2016-3 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2017-1 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2017-2 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2017-3 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2018-1 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2018-2 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2018-3 | |||||||
Principal balance outstanding | $ | $ | |||||
Loans pledged as collateral | |||||||
Restricted cash and cash equivalents pledged as collateral | |||||||
Interest rate | % | % | |||||
Term ABS 2019-1 | |||||||
Principal balance outstanding | $ | $ | — | ||||
Loans pledged as collateral | — | ||||||
Restricted cash and cash equivalents pledged as collateral | — | ||||||
Interest rate | % | — | % | ||||
Term ABS 2019-2 | |||||||
Principal balance outstanding | $ | $ | — | ||||
Loans pledged as collateral | — | ||||||
Restricted cash and cash equivalents pledged as collateral | — | ||||||
Interest rate | % | — | % | ||||
2021 Senior Notes | |||||||
Principal balance outstanding | $ | $ | |||||
Interest rate | % | % | |||||
2023 Senior Notes | |||||||
Principal balance outstanding | $ | $ | |||||
Interest rate | % | % | |||||
2026 Senior Notes | |||||||
Principal balance outstanding | $ | $ | |||||
Interest rate | % | % | |||||
Mortgage Note | |||||||
Principal balance outstanding | $ | $ | |||||
Interest rate | % | % |
(1) | Availability may be limited by the amount of assets pledged as collateral. |
(Dollars in millions) | ||||||||
Term ABS Financings | Close Date | Net Book Value of Loans Contributed at Closing | Revolving Period | |||||
Term ABS 2016-3 | $ | Through October 15, 2018 | ||||||
Term ABS 2017-1 | Through February 15, 2019 | |||||||
Term ABS 2017-2 | Through June 17, 2019 | |||||||
Term ABS 2017-3 | Through October 15, 2019 | |||||||
Term ABS 2018-1 | Through February 17, 2020 | |||||||
Term ABS 2018-2 | Through May 15, 2020 | |||||||
Term ABS 2018-3 | Through August 17, 2020 | |||||||
Term ABS 2019-1 | Through February 15, 2021 | |||||||
Term ABS 2019-2 | Through August 15, 2022 |
(Dollars in millions) | |||||||||||||||||
As of September 30, 2019 | |||||||||||||||||
Facility Amount | Facility Name | Purpose | Start | End | Notional | Cap Interest Rate (1) | |||||||||||
$ | Warehouse Facility II | Cap Floating Rate | 12/2017 | 12/2020 | $ | % | |||||||||||
Warehouse Facility IV | Cap Floating Rate | 05/2017 | 04/2021 | % | |||||||||||||
Cap Floating Rate | 05/2018 | 04/2021 | % | ||||||||||||||
Cap Floating Rate | 07/2019 | 07/2023 | % | ||||||||||||||
Warehouse Facility V | Cap Floating Rate | 08/2018 | 08/2023 | % | |||||||||||||
Warehouse Facility VII | Cap Floating Rate | 12/2017 | 11/2021 | % | |||||||||||||
Warehouse Facility VIII | Cap Floating Rate | 08/2019 | 08/2023 | % |
(Dollars in millions) | |||||||||||||||||
As of December 31, 2018 | |||||||||||||||||
Facility Amount | Facility Name | Purpose | Start | End | Notional | Cap Interest Rate (1) | |||||||||||
$ | Warehouse Facility II | Cap Floating Rate | 12/2017 | 12/2020 | $ | % | |||||||||||
Warehouse Facility IV | Cap Floating Rate | 04/2016 | 04/2019 | % | |||||||||||||
Cap Floating Rate | 05/2017 | 04/2021 | % | ||||||||||||||
Cap Floating Rate | 05/2018 | 04/2021 | % | ||||||||||||||
Warehouse Facility V | Cap Floating Rate | 08/2018 | 08/2023 | % | |||||||||||||
Warehouse Facility VII | Cap Floating Rate | 12/2017 | 11/2021 | % | |||||||||||||
Term ABS 2016-1 | Cap Floating Rate | 04/2016 | 02/2019 | % |
(1) | Rate excludes the spread over the LIBOR rate. |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||
U.S. federal statutory income tax rate | % | % | % | % | |||||||
State income taxes | % | % | % | % | |||||||
Excess tax benefits from stock-based compensation plans | % | % | - | % | % | ||||||
Other | % | % | % | % | |||||||
Effective income tax rate | % | % | % | % |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||
Weighted average shares outstanding: | |||||||||||
Common shares | |||||||||||
Vested restricted stock units | |||||||||||
Basic number of weighted average shares outstanding | |||||||||||
Dilutive effect of restricted stock and restricted stock units | |||||||||||
Dilutive number of weighted average shares outstanding |
(Dollars in millions) | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | |||||||||||||
Stock Repurchases | Number of Shares Repurchased | Cost | Number of Shares Repurchased | Cost | ||||||||||
Open Market (1) | $ | $ | ||||||||||||
Other (2) | ||||||||||||||
Total | $ | $ |
(1) | Represents repurchases under authorizations by the board of directors for the repurchase of shares by us from time to time in the open market or in privately negotiated transactions. On February 13, 2017, the board of directors authorized the repurchase of up to |
(2) | Represents shares of common stock released to us by team members as payment of tax withholdings upon the vesting of restricted stock and restricted stock units and the conversion of restricted stock units to common stock. |
(In millions) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Restricted stock | $ | $ | $ | $ | ||||||||||||
Restricted stock units | ||||||||||||||||
Total | $ | $ | $ | $ |
Restricted Stock | Number of Shares | Weighted Average Grant-Date Fair Value Per Share | |||||
Non-vested as of December 31, 2018 | $ | ||||||
Granted | |||||||
Vested | ( | ) | |||||
Forfeited | ( | ) | |||||
Non-vested as of September 30, 2019 | $ |
Restricted Stock Units | Number of Restricted Stock Units | Weighted Average Grant-Date Fair Value Per Share | |||||
Outstanding as of December 31, 2018 | $ | ||||||
Granted | |||||||
Converted | ( | ) | |||||
Forfeited | ( | ) | |||||
Outstanding as of September 30, 2019 | $ |
Forecasted Collection Percentage as of (1) | Current Forecast Variance from | ||||||||||||||||||||
Consumer Loan Assignment Year | September 30, 2019 | June 30, 2019 | December 31, 2018 | Initial Forecast | June 30, 2019 | December 31, 2018 | Initial Forecast | ||||||||||||||
2010 | 77.7 | % | 77.7 | % | 77.7 | % | 73.6 | % | 0.0 | % | 0.0 | % | 4.1 | % | |||||||
2011 | 74.8 | % | 74.8 | % | 74.7 | % | 72.5 | % | 0.0 | % | 0.1 | % | 2.3 | % | |||||||
2012 | 73.9 | % | 73.9 | % | 73.8 | % | 71.4 | % | 0.0 | % | 0.1 | % | 2.5 | % | |||||||
2013 | 73.5 | % | 73.5 | % | 73.5 | % | 72.0 | % | 0.0 | % | 0.0 | % | 1.5 | % | |||||||
2014 | 71.8 | % | 71.8 | % | 71.7 | % | 71.8 | % | 0.0 | % | 0.1 | % | 0.0 | % | |||||||
2015 | 65.5 | % | 65.5 | % | 65.4 | % | 67.7 | % | 0.0 | % | 0.1 | % | -2.2 | % | |||||||
2016 | 64.1 | % | 64.2 | % | 64.2 | % | 65.4 | % | -0.1 | % | -0.1 | % | -1.3 | % | |||||||
2017 | 65.0 | % | 65.1 | % | 65.5 | % | 64.0 | % | -0.1 | % | -0.5 | % | 1.0 | % | |||||||
2018 | 65.4 | % | 65.5 | % | 65.0 | % | 63.6 | % | -0.1 | % | 0.4 | % | 1.8 | % | |||||||
2019 (2) | 64.8 | % | 64.7 | % | — | 64.1 | % | 0.1 | % | — | 0.7 | % |
(1) | Represents the total forecasted collections we expect to collect on the Consumer Loans as a percentage of the repayments that we were contractually owed on the Consumer Loans at the time of assignment. Contractual repayments include both principal and interest. Forecasted collection rates are negatively impacted by canceled Consumer Loans as the contractual amount owed is not removed from the denominator for purposes of computing forecasted collection rates in the table. |
(2) | The forecasted collection rate for 2019 Consumer Loans as of September 30, 2019 includes both Consumer Loans that were in our portfolio as of June 30, 2019 and Consumer Loans assigned during the most recent quarter. The following table provides forecasted collection rates for each of these segments: |
Forecasted Collection Percentage as of | Current Forecast Variance from | ||||||||||||||
2019 Consumer Loan Assignment Period | September 30, 2019 | June 30, 2019 | Initial Forecast | June 30, 2019 | Initial Forecast | ||||||||||
January 1, 2019 through June 30, 2019 | 65.1 | % | 64.7 | % | 64.2 | % | 0.4 | % | 0.9 | % | |||||
July 1, 2019 through September 30, 2019 | 64.1 | % | — | 64.0 | % | — | 0.1 | % |
(In millions) | For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||
Increase (Decrease) in Forecasted Net Cash Flows | 2019 | 2018 | 2019 | 2018 | ||||||||||||
Dealer Loans | $ | (4.2 | ) | $ | (0.1 | ) | $ | (0.3 | ) | $ | 3.5 | |||||
Purchased Loans | 6.8 | 17.2 | 32.6 | 31.0 | ||||||||||||
Total Loans | $ | 2.6 | $ | 17.1 | $ | 32.3 | $ | 34.5 |
Average | |||||||||||
Consumer Loan Assignment Year | Consumer Loan (1) | Advance (2) | Initial Loan Term (in months) | ||||||||
2010 | $ | 14,480 | $ | 6,473 | 41 | ||||||
2011 | 15,686 | 7,137 | 46 | ||||||||
2012 | 15,468 | 7,165 | 47 | ||||||||
2013 | 15,445 | 7,344 | 47 | ||||||||
2014 | 15,692 | 7,492 | 47 | ||||||||
2015 | 16,354 | 7,272 | 50 | ||||||||
2016 | 18,218 | 7,976 | 53 | ||||||||
2017 | 20,230 | 8,746 | 55 | ||||||||
2018 | 22,158 | 9,635 | 57 | ||||||||
2019 (3) | 22,942 | 10,098 | 57 |
(1) | Represents the repayments that we were contractually owed on Consumer Loans at the time of assignment, which include both principal and interest. |
(2) | Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. Payments of Dealer Holdback and accelerated Dealer Holdback are not included. |
(3) | The averages for 2019 Consumer Loans include both Consumer Loans that were in our portfolio as of June 30, 2019 and Consumer Loans assigned during the most recent quarter. The following table provides averages for each of these segments: |
Average | |||||||||||
2019 Consumer Loan Assignment Period | Consumer Loan | Advance | Initial Loan Term (in months) | ||||||||
January 1, 2019 through June 30, 2019 | $ | 22,740 | $ | 10,023 | 57 | ||||||
July 1, 2019 through September 30, 2019 | 23,423 | 10,275 | 58 |
As of September 30, 2019 | ||||||||||||
Consumer Loan Assignment Year | Forecasted Collection % | Advance % (1) | Spread % | % of Forecast Realized (2) | ||||||||
2010 | 77.7 | % | 44.7 | % | 33.0 | % | 99.8 | % | ||||
2011 | 74.8 | % | 45.5 | % | 29.3 | % | 99.5 | % | ||||
2012 | 73.9 | % | 46.3 | % | 27.6 | % | 99.2 | % | ||||
2013 | 73.5 | % | 47.6 | % | 25.9 | % | 98.7 | % | ||||
2014 | 71.8 | % | 47.7 | % | 24.1 | % | 97.6 | % | ||||
2015 | 65.5 | % | 44.5 | % | 21.0 | % | 93.2 | % | ||||
2016 | 64.1 | % | 43.8 | % | 20.3 | % | 81.9 | % | ||||
2017 | 65.0 | % | 43.2 | % | 21.8 | % | 64.1 | % | ||||
2018 | 65.4 | % | 43.5 | % | 21.9 | % | 38.5 | % | ||||
2019 (3) | 64.8 | % | 44.0 | % | 20.8 | % | 11.2 | % |
(1) | Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program as a percentage of the initial balance of the Consumer Loans. Payments of Dealer Holdback and accelerated Dealer Holdback are not included. |
(2) | Presented as a percentage of total forecasted collections. |
(3) | The forecasted collection rate, advance rate and spread for 2019 Consumer Loans as of September 30, 2019 include both Consumer Loans that were in our portfolio as of June 30, 2019 and Consumer Loans assigned during the most recent quarter. The following table provides forecasted collection rates, advance rates and spreads for each of these segments: |
As of September 30, 2019 | |||||||||
2019 Consumer Loan Assignment Period | Forecasted Collection % | Advance % | Spread % | ||||||
January 1, 2019 through June 30, 2019 | 65.1 | % | 44.1 | % | 21.0 | % | |||
July 1, 2019 through September 30, 2019 | 64.1 | % | 43.9 | % | 20.2 | % |
Dealer Loans | Purchased Loans | |||||||||||||||||
Forecasted Collection Percentage as of (1) | Forecasted Collection Percentage as of (1) | |||||||||||||||||
Consumer Loan Assignment Year | September 30, 2019 | Initial Forecast | Variance | September 30, 2019 | Initial Forecast | Variance | ||||||||||||
2010 | 77.6 | % | 73.6 | % | 4.0 | % | 78.7 | % | 73.1 | % | 5.6 | % | ||||||
2011 | 74.6 | % | 72.4 | % | 2.2 | % | 76.3 | % | 72.7 | % | 3.6 | % | ||||||
2012 | 73.7 | % | 71.3 | % | 2.4 | % | 75.9 | % | 71.4 | % | 4.5 | % | ||||||
2013 | 73.4 | % | 72.1 | % | 1.3 | % | 74.4 | % | 71.6 | % | 2.8 | % | ||||||
2014 | 71.6 | % | 71.9 | % | -0.3 | % | 72.6 | % | 70.9 | % | 1.7 | % | ||||||
2015 | 64.8 | % | 67.5 | % | -2.7 | % | 69.3 | % | 68.5 | % | 0.8 | % | ||||||
2016 | 63.3 | % | 65.1 | % | -1.8 | % | 66.7 | % | 66.5 | % | 0.2 | % | ||||||
2017 | 64.3 | % | 63.8 | % | 0.5 | % | 66.5 | % | 64.6 | % | 1.9 | % | ||||||
2018 | 65.0 | % | 63.6 | % | 1.4 | % | 66.3 | % | 63.5 | % | 2.8 | % | ||||||
2019 | 64.6 | % | 64.0 | % | 0.6 | % | 65.2 | % | 64.2 | % | 1.0 | % |
(1) | The forecasted collection rates presented for Dealer Loans and Purchased Loans reflect the Consumer Loan classification at the time of assignment. |
Dealer Loans | Purchased Loans | |||||||||||||||||
Consumer Loan Assignment Year | Forecasted Collection % (1) | Advance % (1)(2) | Spread % | Forecasted Collection % (1) | Advance % (1)(2) | Spread % | ||||||||||||
2010 | 77.6 | % | 44.4 | % | 33.2 | % | 78.7 | % | 47.3 | % | 31.4 | % | ||||||
2011 | 74.6 | % | 45.1 | % | 29.5 | % | 76.3 | % | 49.3 | % | 27.0 | % | ||||||
2012 | 73.7 | % | 46.0 | % | 27.7 | % | 75.9 | % | 50.0 | % | 25.9 | % | ||||||
2013 | 73.4 | % | 47.2 | % | 26.2 | % | 74.4 | % | 51.5 | % | 22.9 | % | ||||||
2014 | 71.6 | % | 47.2 | % | 24.4 | % | 72.6 | % | 51.8 | % | 20.8 | % | ||||||
2015 | 64.8 | % | 43.4 | % | 21.4 | % | 69.3 | % | 50.2 | % | 19.1 | % | ||||||
2016 | 63.3 | % | 42.1 | % | 21.2 | % | 66.7 | % | 48.6 | % | 18.1 | % | ||||||
2017 | 64.3 | % | 42.1 | % | 22.2 | % | 66.5 | % | 45.8 | % | 20.7 | % | ||||||
2018 | 65.0 | % | 42.7 | % | 22.3 | % | 66.3 | % | 45.2 | % | 21.1 | % | ||||||
2019 | 64.6 | % | 43.1 | % | 21.5 | % | 65.2 | % | 45.7 | % | 19.5 | % |
(1) | The forecasted collection rates and advance rates presented for Dealer Loans and Purchased Loans reflect the Consumer Loan classification at the time of assignment. |
(2) | Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program as a percentage of the initial balance of the Consumer Loans. Payments of Dealer Holdback and accelerated Dealer Holdback are not included. |
Year over Year Percent Change | ||||||
Three Months Ended | Unit Volume | Dollar Volume (1) | ||||
March 31, 2018 | 18.5 | % | 32.9 | % | ||
June 30, 2018 | 19.8 | % | 34.7 | % | ||
September 30, 2018 | 9.4 | % | 20.3 | % | ||
December 31, 2018 | 5.9 | % | 12.4 | % | ||
March 31, 2019 | 0.4 | % | 5.1 | % | ||
June 30, 2019 | 0.0 | % | 5.6 | % | ||
September 30, 2019 | 0.4 | % | 7.6 | % |
(1) | Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. Payments of Dealer Holdback and accelerated Dealer Holdback are not included. |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||
Consumer Loan unit volume | 86,331 | 86,005 | 0.4 | % | 291,788 | 290,976 | 0.3 | % | |||||||||
Active Dealers (1) | 9,555 | 8,684 | 10.0 | % | 12,553 | 11,390 | 10.2 | % | |||||||||
Average volume per active Dealer | 9.0 | 9.9 | -9.1 | % | 23.2 | 25.5 | -9.0 | % | |||||||||
Consumer Loan unit volume from Dealers active both periods | 65,264 | 72,044 | -9.4 | % | 242,418 | 262,703 | -7.7 | % | |||||||||
Dealers active both periods | 5,900 | 5,900 | — | 8,294 | 8,294 | — | |||||||||||
Average volume per Dealer active both periods | 11.1 | 12.2 | -9.4 | % | 29.2 | 31.7 | -7.7 | % | |||||||||
Consumer Loan unit volume from Dealers not active both periods | 21,067 | 13,961 | 50.9 | % | 49,370 | 28,273 | 74.6 | % | |||||||||
Dealers not active both periods | 3,655 | 2,784 | 31.3 | % | 4,259 | 3,096 | 37.6 | % | |||||||||
Average volume per Dealer not active both periods | 5.8 | 5.0 | 16.0 | % | 11.6 | 9.1 | 27.5 | % |
(1) | Active Dealers are Dealers who have received funding for at least one Consumer Loan during the period. |
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||
Consumer Loan unit volume from new active Dealers | 3,455 | 3,785 | -8.7 | % | 30,632 | 30,477 | 0.5 | % | |||||||||
New active Dealers (1) | 951 | 936 | 1.6 | % | 3,183 | 3,005 | 5.9 | % | |||||||||
Average volume per new active Dealer | 3.6 | 4.0 | -10.0 | % | 9.6 | 10.1 | -5.0 | % | |||||||||
Attrition (2) | -16.2 | % | -16.7 | % | -9.7 | % | -11.9 | % |
(1) | New active Dealers are Dealers who enrolled in our program and have received funding for their first Loan from us during the period. |
(2) | Attrition is measured according to the following formula: decrease in Consumer Loan unit volume from Dealers who have received funding for at least one Loan during the comparable period of the prior year but did not receive funding for any Loans during the current period divided by prior year comparable period Consumer Loan unit volume. |
Unit Volume | Dollar Volume (1) | |||||||||||
Three Months Ended | Dealer Loans | Purchased Loans | Dealer Loans | Purchased Loans | ||||||||
March 31, 2018 | 70.1 | % | 29.9 | % | 67.4 | % | 32.6 | % | ||||
June 30, 2018 | 69.7 | % | 30.3 | % | 66.8 | % | 33.2 | % | ||||
September 30, 2018 | 69.5 | % | 30.5 | % | 67.0 | % | 33.0 | % | ||||
December 31, 2018 | 69.4 | % | 30.6 | % | 67.4 | % | 32.6 | % | ||||
March 31, 2019 | 67.4 | % | 32.6 | % | 65.0 | % | 35.0 | % | ||||
June 30, 2019 | 66.7 | % | 33.3 | % | 63.7 | % | 36.3 | % | ||||
September 30, 2019 | 67.2 | % | 32.8 | % | 64.1 | % | 35.9 | % |
(1) | Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. Payments of Dealer Holdback and accelerated Dealer Holdback are not included. |
(Dollars in millions, except per share data) | For the Three Months Ended September 30, | |||||||||||||
2019 | 2018 | $ Change | % Change | |||||||||||
Revenue: | ||||||||||||||
Finance charges | $ | 349.9 | $ | 303.0 | $ | 46.9 | 15.5 | % | ||||||
Premiums earned | 12.9 | 12.2 | 0.7 | 5.7 | % | |||||||||
Other income | 15.9 | 16.8 | (0.9 | ) | -5.4 | % | ||||||||
Total revenue | 378.7 | 332.0 | 46.7 | 14.1 | % | |||||||||
Costs and expenses: | ||||||||||||||
Salaries and wages (1) | 47.9 | 41.1 | 6.8 | 16.5 | % | |||||||||
General and administrative (1) | 17.2 | 14.1 | 3.1 | 22.0 | % | |||||||||
Sales and marketing (1) | 16.6 | 16.3 | 0.3 | 1.8 | % | |||||||||
Provision for credit losses | 19.3 | 14.0 | 5.3 | 37.9 | % | |||||||||
Interest | 50.4 | 41.1 | 9.3 | 22.6 | % | |||||||||
Provision for claims | 8.2 | 7.0 | 1.2 | 17.1 | % | |||||||||
Total costs and expenses | 159.6 | 133.6 | 26.0 | 19.5 | % | |||||||||
Income before provision for income taxes | 219.1 | 198.4 | 20.7 | 10.4 | % | |||||||||
Provision for income taxes | 53.7 | 47.4 | 6.3 | 13.3 | % | |||||||||
Net income | $ | 165.4 | $ | 151.0 | $ | 14.4 | 9.5 | % | ||||||
Net income per share: | ||||||||||||||
Basic | $ | 8.73 | $ | 7.76 | $ | 0.97 | 12.5 | % | ||||||
Diluted | $ | 8.73 | $ | 7.75 | $ | 0.98 | 12.6 | % | ||||||
Weighted average shares outstanding: | ||||||||||||||
Basic | 18,944,672 | 19,465,563 | (520,891 | ) | -2.7 | % | ||||||||
Diluted | 18,950,866 | 19,473,978 | (523,112 | ) | -2.7 | % | ||||||||
(1) Operating expenses | $ | 81.7 | $ | 71.5 | $ | 10.2 | 14.3 | % |
(Dollars in millions) | For the Three Months Ended September 30, | ||||||||||
2019 | 2018 | Change | |||||||||
Average net Loans receivable balance | $ | 6,480.4 | $ | 5,458.3 | $ | 1,022.1 | |||||
Average yield on our Loan portfolio | 21.6 | % | 22.2 | % | -0.6 | % |
(In millions) | Year over Year Change | ||
Impact on finance charges: | For the Three Months Ended September 30, 2019 | ||
Due to an increase in the average net Loans receivable balance | $ | 56.7 | |
Due to a decrease in the average yield | (9.8 | ) | |
Total increase in finance charges | $ | 46.9 |
• | An increase in salaries and wages expense of $6.8 million, or 16.5%, comprised of the following: |
• | An increase of $4.2 million in cash-based incentive compensation expense primarily due to an improvement in Company performance measures. |
• | Excluding the change in cash-based incentive compensation expense, salaries and wages expense increased $2.6 million, primarily related to our support function primarily as a result of an increase in the number of team members. |
• | An increase in general and administrative expense of $3.1 million, or 22.0%, primarily due to increases in legal and building expenses. |
(Dollars in millions) | For the Three Months Ended September 30, | ||||||||||
2019 | 2018 | Change | |||||||||
Interest expense | $ | 50.4 | $ | 41.1 | $ | 9.3 | |||||
Average outstanding debt principal balance (1) | 4,255.5 | 3,807.6 | 447.9 | ||||||||
Average cost of debt | 4.7 | % | 4.3 | % | 0.4 | % |
(1) | Includes the unamortized debt discount and excludes deferred debt issuance costs. |
(Dollars in millions, except per share data) | For the Nine Months Ended September 30, | |||||||||||||
2019 | 2018 | $ Change | % Change | |||||||||||
Revenue: | ||||||||||||||
Finance charges | $ | 1,013.3 | $ | 863.0 | $ | 150.3 | 17.4 | % | ||||||
Premiums earned | 38.2 | 34.2 | 4.0 | 11.7 | % | |||||||||
Other income | 51.6 | 45.8 | 5.8 | 12.7 | % | |||||||||
Total revenue | 1,103.1 | 943.0 | 160.1 | 17.0 | % | |||||||||
Costs and expenses: | ||||||||||||||
Salaries and wages (1) | 143.9 | 123.3 | 20.6 | 16.7 | % | |||||||||
General and administrative (1) | 47.9 | 41.3 | 6.6 | 16.0 | % | |||||||||
Sales and marketing (1) | 53.1 | 51.3 | 1.8 | 3.5 | % | |||||||||
Provision for credit losses | 49.2 | 39.2 | 10.0 | 25.5 | % | |||||||||
Interest | 145.2 | 114.3 | 30.9 | 27.0 | % | |||||||||
Provision for claims | 23.1 | 19.5 | 3.6 | 18.5 | % | |||||||||
Total costs and expenses | 462.4 | 388.9 | 73.5 | 18.9 | % | |||||||||
Income before provision for income taxes | 640.7 | 554.1 | 86.6 | 15.6 | % | |||||||||
Provision for income taxes | 146.5 | 132.0 | 14.5 | 11.0 | % | |||||||||
Net income | $ | 494.2 | $ | 422.1 | $ | 72.1 | 17.1 | % | ||||||
Net income per share: | ||||||||||||||
Basic | $ | 26.08 | $ | 21.69 | $ | 4.39 | 20.2 | % | ||||||
Diluted | $ | 26.06 | $ | 21.68 | $ | 4.38 | 20.2 | % | ||||||
Weighted average shares outstanding: | ||||||||||||||
Basic | 18,948,140 | 19,456,389 | (508,249 | ) | -2.6 | % | ||||||||
Diluted | 18,967,552 | 19,472,197 | (504,645 | ) | -2.6 | % | ||||||||
(1) Operating expenses | $ | 244.9 | $ | 215.9 | 29.0 | 13.4 | % |
(Dollars in millions) | For the Nine Months Ended September 30, | ||||||||||
2019 | 2018 | Change | |||||||||
Average net Loans receivable balance | $ | 6,216.2 | $ | 5,147.4 | $ | 1,068.8 | |||||
Average yield on our Loan portfolio | 21.7 | % | 22.4 | % | -0.7 | % |
(In millions) | Year over Year Change | ||
Impact on finance charges: | For the Nine Months Ended September 30, 2019 | ||
Due to an increase in the average net Loans receivable balance | $ | 179.2 | |
Due to a decrease in the average yield | (28.9 | ) | |
Total increase in finance charges | $ | 150.3 |
• | An increase of $13.3 million in cash-based incentive compensation expense primarily due to an improvement in Company performance measures. |
• | Excluding the change in cash-based incentive compensation expense, salaries and wages expense increased $7.3 million, primarily related to our support function primarily as a result of an increase in the number of team members. |
(Dollars in millions) | For the Nine Months Ended September 30, | ||||||||||
2019 | 2018 | Change | |||||||||
Interest expense | $ | 145.2 | $ | 114.3 | $ | 30.9 | |||||
Average outstanding debt principal balance (1) | 4,181.7 | 3,581.0 | 600.7 | ||||||||
Average cost of debt | 4.6 | % | 4.3 | % | 0.3 | % |
(1) | Includes the unamortized debt discount and excludes deferred debt issuance costs. |
(In millions) | ||||
Year | Scheduled Principal Debt Maturities (1) | |||
Remainder of 2019 | $ | 245.8 | ||
2020 | 1,374.5 | |||
2021 | 1,291.1 | |||
2022 | 687.1 | |||
2023 | 259.3 | |||
Over five years | 400.0 | |||
Total | $ | 4,257.8 |
(1) | The principal maturities of certain financings are estimated based on forecasted collections. |
• | Our inability to accurately forecast and estimate the amount and timing of future collections could have a material adverse effect on results of operations. |
• | We may be unable to execute our business strategy due to current economic conditions. |
• | We may be unable to continue to access or renew funding sources and obtain capital needed to maintain and grow our business. |
• | The terms of our debt limit how we conduct our business. |
• | A violation of the terms of our Term ABS facilities or Warehouse facilities could have a material adverse impact on our operations. |
• | The conditions of the U.S. and international capital markets may adversely affect lenders with which we have relationships, causing us to incur additional costs and reducing our sources of liquidity, which may adversely affect our financial position, liquidity and results of operations. |
• | Our substantial debt could negatively impact our business, prevent us from satisfying our debt obligations and adversely affect our financial condition. |
• | Due to competition from traditional financing sources and non-traditional lenders, we may not be able to compete successfully. |
• | We may not be able to generate sufficient cash flows to service our outstanding debt and fund operations and may be forced to take other actions to satisfy our obligations under such debt. |
• | Interest rate fluctuations may adversely affect our borrowing costs, profitability and liquidity. |
• | Reduction in our credit rating could increase the cost of our funding from, and restrict our access to, the capital markets and adversely affect our liquidity, financial condition and results of operations. |
• | We may incur substantially more debt and other liabilities. This could exacerbate further the risks associated with our current debt levels. |
• | The regulation to which we are or may become subject could result in a material adverse effect on our business. |
• | Adverse changes in economic conditions, the automobile or finance industries, or the non-prime consumer market could adversely affect our financial position, liquidity and results of operations, the ability of key vendors that we depend on to supply us with services, and our ability to enter into future financing transactions. |
• | Litigation we are involved in from time to time may adversely affect our financial condition, results of operations and cash flows. |
• | Changes in tax laws and the resolution of uncertain income tax matters could have a material adverse effect on our results of operations and cash flows from operations. |
• | Our dependence on technology could have a material adverse effect on our business. |
• | Our use of electronic contracts could impact our ability to perfect our ownership or security interest in Consumer Loans. |
• | Reliance on third parties to administer our ancillary product offerings could adversely affect our business and financial results. |
• | We are dependent on our senior management and the loss of any of these individuals or an inability to hire additional team members could adversely affect our ability to operate profitably. |
• | Our reputation is a key asset to our business, and our business may be affected by how we are perceived in the marketplace. |
• | The concentration of our Dealers in several states could adversely affect us. |
• | Failure to properly safeguard confidential consumer and team member information could subject us to liability, decrease our profitability and damage our reputation. |
• | A small number of our shareholders have the ability to significantly influence matters requiring shareholder approval and such shareholders have interests which may conflict with the interests of our other security holders. |
• | Reliance on our outsourced business functions could adversely affect our business. |
• | Our ability to hire and retain foreign information technology personnel could be hindered by immigration restrictions. |
• | Natural disasters, acts of war, terrorist attacks and threats or the escalation of military activity in response to these attacks or otherwise may negatively affect our business, financial condition and results of operations. |
Exhibit No. | Description | |
Amendment No. 2 to the Sixth Amended and Restated Loan and Security Agreement dated as of July 12, 2019 among the Company, CAC Warehouse Funding Corporation II and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.102 to the Company’s Current Report on Form 8-K filed July 15, 2019). | ||
Fourth Amendment to Loan Security Agreement dated as of July 16, 2019 among the Company, CAC Warehouse Funding LLC V and Fifth Third Bank (incorporated by reference to Exhibit 4.103 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019). | ||
Second Amendment to Loan and Security Agreement, dated as of July 18, 2019 among the Company, CAC Warehouse Funding LLC VII, the lenders party thereto, Credit Suisse International and Credit Suisse AG, New York Branch (incorporated by reference to Exhibit 4.104 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019). | ||
Second Amendment to Loan and Security Agreement dated as of July 25, 2019 among the Company, CAC Warehouse Funding LLC VI and Flagstar Bank, FSB (incorporated by reference to Exhibit 4.105 to the Company’s Current Report on Form 8-K filed July 26, 2019). | ||
Loan and Security Agreement, dated as of July 26, 2019, among the Company, CAC Warehouse Funding LLC VIII, Citizens Bank N.A. and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.106 to the Company’s Current Report on Form 8-K filed July 29, 2019). | ||
Sale and Contribution Agreement, dated as of July 26, 2019, between the Company and CAC Warehouse Funding LLC VIII (incorporated by reference to Exhibit 4.107 to the Company’s Current Report on Form 8-K filed July 29, 2019). | ||
Backup Servicer Agreement, dated as of July 26, 2019, among the Company, CAC Warehouse Funding LLC VIII, Citizens Bank, N.A. and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.108 to the Company’s Current Report on Form 8-K filed July 29, 2019). | ||
Amended and Restated Intercreditor Agreement, dated July 26, 2019, among the Company, CAC Warehouse Funding Corporation II, CAC Warehouse Funding LLC IV, CAC Warehouse Funding LLC V, CAC Warehouse Funding LLC VI, CAC Warehouse Funding LLC VII, CAC Warehouse Funding LLC VIII, Credit Acceptance Funding LLC 2019-1, Credit Acceptance Funding LLC 2018-3, Credit Acceptance Funding LLC 2018-2, Credit Acceptance Funding LLC 2018-1, Credit Acceptance Funding LLC 2017-3, Credit Acceptance Funding LLC 2017-2, Credit Acceptance Funding LLC 2017-1, Credit Acceptance Funding LLC 2016-3, Credit Acceptance Funding LLC 2016-2, Credit Acceptance Auto Loan Trust 2019-1, Credit Acceptance Auto Loan Trust 2018-3, Credit Acceptance Auto Loan Trust 2018-2, Credit Acceptance Auto Loan Trust 2018-1, Credit Acceptance Auto Loan Trust 2017-3, Credit Acceptance Auto Loan Trust 2017-2, Credit Acceptance Auto Loan Trust 2017-1, Credit Acceptance Auto Loan Trust 2016-3, Credit Acceptance Auto Loan Trust 2016-2, Wells Fargo Bank, National Association, as agent, Fifth Third Bank, as agent, Bank of Montreal, as agent, Flagstar Bank, FSB, as agent, Citizens Bank, N.A., as agent and Comerica Bank, as agent (incorporated by reference to Exhibit 4.109 to the Company’s Current Report on Form 8-K filed July 29, 2019). | ||
First Amendment to Amended and Restated Loan and Security Agreement, dated as of July 26, 2019, among the Company, CAC Warehouse Funding LLC IV, Bank of Montreal, Citizens Bank, N.A., BMO Capital Markets Corp. and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.110 to the Company’s Current Report on Form 8-K filed July 29, 2019). | ||
Amended and Restated Backup Servicing Agreement, dated as of July 26, 2019, among the Company, CAC Warehouse Funding LLC IV, Bank of Montreal, BMO Capital Markets Corp. and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.111 to the Company’s Current Report on Form 8-K filed July 29, 2019). | ||
Loan and Security Agreement dated as of August 28, 2019 among the Company, Credit Acceptance Funding LLC 2019-2 and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.112 to the Company’s Current Report on Form 8-K filed September 4, 2019). | ||
Backup Servicing Agreement dated as of August 28, 2019, among the Company, Credit Acceptance Funding LLC 2019-2 and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 4.113 to the Company’s Current Report on Form 8-K filed September 4, 2019). |
Sale and Contribution Agreement, dated as of August 28, 2019, between the Company and Credit Acceptance Funding LLC 2019-2 (incorporated by reference to Exhibit 4.114 to the Company’s Current Report on Form 8-K filed September 4, 2019). | ||
Amended and Restated Intercreditor Agreement, dated August 28, 2019, among the Company, CAC Warehouse Funding Corporation II, CAC Warehouse Funding LLC IV, CAC Warehouse Funding LLC V, CAC Warehouse Funding LLC VI, CAC Warehouse Funding LLC VII, CAC Warehouse Funding LLC VIII, Credit Acceptance Funding LLC 2019-2, Credit Acceptance Funding LLC 2019-1, Credit Acceptance Funding LLC 2018-3, Credit Acceptance Funding LLC 2018-2, Credit Acceptance Funding LLC 2018-1, Credit Acceptance Funding LLC 2017-3, Credit Acceptance Funding LLC 2017-2, Credit Acceptance Funding LLC 2017-1, Credit Acceptance Funding LLC 2016-3, Credit Acceptance Auto Loan Trust 2019-1, Credit Acceptance Auto Loan Trust 2018-3, Credit Acceptance Auto Loan Trust 2018-2, Credit Acceptance Auto Loan Trust 2018-1, Credit Acceptance Auto Loan Trust 2017-3, Credit Acceptance Auto Loan Trust 2017-2, Credit Acceptance Auto Loan Trust 2017-1, Credit Acceptance Auto Loan Trust 2016-3, Wells Fargo Bank, National Association, as agent, Fifth Third Bank, as agent, Bank of Montreal, as agent, Flagstar Bank, FSB, as agent, Citizens Bank, N.A., as agent and Comerica Bank, as agent (incorporated by reference to Exhibit 4.115 to the Company’s Current Report on Form 8-K filed September 4, 2019). | ||
Amendment No. 3 to the Sixth Amended and Restated Loan and Security Agreement dated as of August 16, 2019 among the Company, CAC Warehouse Funding Corporation II and Wells Fargo Bank, National Association. | ||
Second Amended and Restated Backup Servicing Agreement, dated as of August 16, 2019, among the Company, CAC Warehouse Funding LLC II and Wells Fargo Bank, National Association. | ||
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
101(SCH) | Inline XBRL Taxonomy Extension Schema Document. | |
101(CAL) | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
101(DEF) | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
101(LAB) | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
101(PRE) | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
104 | Cover Page Interactive Data File (included in Exhibit 101). | |
CREDIT ACCEPTANCE CORPORATION | |||
(Registrant) | |||
By: | /s/ Kenneth S. Booth | ||
Kenneth S. Booth | |||
Chief Financial Officer | |||
(Principal Financial Officer and Principal Accounting Officer) | |||
Date: | November 1, 2019 |
THE BORROWER: | CAC WAREHOUSE FUNDING CORPORATION II |
By: /s/ Douglas W. Busk | |
Name: Douglas W. Busk | |
Title: Senior Vice President & Treasurer | |
THE SERVICER AND CUSTODIAN: | CREDIT ACCEPTANCE CORPORATION |
By: /s/ Douglas W. Busk | |
Name: Douglas W. Busk | |
Title: Senior Vice President & Treasurer | |
THE COLLATERAL AGENT AND BACKUP SERVICER: | WELLS FARGO BANK, NATIONAL ASSOCIATION, as Collateral Agent and Backup Servicer |
By: /s/ Kristen L. Puttin | |
Name: Kristen L. Puttin | |
Title: Vice President | |
THE DEAL AGENT AND SOLE LENDER: | WELLS FARGO BANK, NATIONAL ASSOCIATION, as Deal Agent and Lender |
By: /s/ James B. Brinkley II | |
Name: James B. Brinkley II | |
Title: Managing Director | |
Date: | November 1, 2019 | By: | /s/ Brett A. Roberts | |
Brett A. Roberts | ||||
Chief Executive Officer | ||||
(Principal Executive Officer) |
Date: | November 1, 2019 | By: | /s/ Kenneth S. Booth | |
Kenneth S. Booth | ||||
Chief Financial Officer | ||||
(Principal Financial Officer) |
Date: | November 1, 2019 | By: | /s/ Brett A. Roberts | |
Brett A. Roberts | ||||
Chief Executive Officer | ||||
(Principal Executive Officer) |
Date: | November 1, 2019 | By: | /s/ Kenneth S. Booth | |
Kenneth S. Booth | ||||
Chief Financial Officer | ||||
(Principal Financial Officer) |
Stock Repurchases |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Repurchases [Text Block] | STOCK REPURCHASES There were no stock repurchases for the three months ended September 30, 2019 and 2018. The following table summarizes our stock repurchases for the nine months ended September 30, 2019 and 2018:
(2) Represents shares of common stock released to us by team members as payment of tax withholdings upon the vesting of restricted stock and restricted stock units and the conversion of restricted stock units to common stock.
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Description of Business (Tables) |
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Description Of Business [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Percentage of Consumer Loans Assigned with FICO Score of Less Than 650 or No FICO Score | The following table shows the percentage of Consumer Loans assigned to us with either FICO® scores below 650 or no FICO® scores:
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Schedule of Percentage of Consumer Loans Assigned Based on Unit Volumes | The following table shows the percentage of Consumer Loans assigned to us as Dealer Loans and Purchased Loans for each of the last seven quarters:
(1) Represents advances paid to Dealers on Consumer Loans assigned under our Portfolio Program and one-time payments made to Dealers to purchase Consumer Loans assigned under our Purchase Program. Payments of Dealer Holdback (as defined below) and accelerated Dealer Holdback are not included.
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Loans Receivable (Tables) |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Loans Receivable | Loans receivable consists of the following:
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Summary of Changes in Loans Receivable | A summary of changes in Loans receivable is as follows:
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Summary of Changes in Accretable Yield | A summary of changes in the accretable yield is as follows:
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Summary of Information Related to New Consumer Loan Assignments | Additional information related to new Consumer Loan assignments is as follows:
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Schedule of Consumer Loans Forecasted Collection Percentage | The following table compares our forecast of Consumer Loan collection rates as of September 30, 2019 with the forecasts as of June 30, 2019, as of December 31, 2018 and at the time of assignment, segmented by year of assignment:
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Schedule of Additional Consumer Loans Forecasted Collection Percentage |
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Schedule of Consumer Loans Performance | The following table segments our Loan portfolio by the performance of the Loan pools:
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Summary of Changes in Allowance for Credit Losses | A summary of changes in the allowance for credit losses is as follows:
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Debt (Summary of Debt) (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Dec. 31, 2017 |
Mar. 30, 2015 |
|||||
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Debt Instrument [Line Items] | ||||||||||
Balance outstanding | $ 52.2 | $ 171.9 | ||||||||
Secured Debt | 3,228.3 | 3,092.7 | ||||||||
Balance outstanding | 940.2 | 544.4 | ||||||||
Restricted cash and cash equivalents pledged as collateral | 329.8 | 303.6 | $ 347.6 | $ 255.6 | ||||||
Mortgage note | [1] | 11.5 | 11.9 | |||||||
Revolving Secured Line of Credit [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Balance outstanding | 52.2 | 171.9 | ||||||||
Amount available for borrowing | [2] | $ 287.8 | $ 178.1 | |||||||
Interest rate | 3.89% | 4.38% | ||||||||
Warehouse Facility II [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 0.0 | ||||||||
Amount available for borrowing | [2] | 400.0 | 400.0 | |||||||
Loans pledged as collateral | 0.0 | 0.0 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 1.0 | $ 1.0 | ||||||||
Interest rate | 0.00% | 0.00% | ||||||||
Warehouse Facility IV [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 0.0 | ||||||||
Amount available for borrowing | [2] | 300.0 | 250.0 | |||||||
Loans pledged as collateral | 0.0 | 0.0 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 1.0 | $ 1.0 | ||||||||
Interest rate | 0.00% | 0.00% | ||||||||
Warehouse Facility V [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 0.0 | ||||||||
Amount available for borrowing | [2] | 100.0 | 100.0 | |||||||
Loans pledged as collateral | 0.0 | 0.0 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 1.0 | $ 1.0 | ||||||||
Interest rate | 0.00% | 0.00% | ||||||||
Warehouse Facility VI [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 0.0 | ||||||||
Amount available for borrowing | [2] | 75.0 | 75.0 | |||||||
Loans pledged as collateral | 0.0 | |||||||||
Restricted cash and cash equivalents pledged as collateral | $ 0.0 | $ 0.1 | ||||||||
Interest rate | 0.00% | 0.00% | ||||||||
Warehouse Facility VII [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 0.0 | ||||||||
Amount available for borrowing | [2] | 150.0 | 150.0 | |||||||
Loans pledged as collateral | 0.0 | 0.0 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 1.0 | $ 1.0 | ||||||||
Interest rate | 0.00% | 0.00% | ||||||||
Warehouse Facility VIII [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 0.0 | ||||||||
Amount available for borrowing | [2] | 200.0 | 0.0 | |||||||
Loans pledged as collateral | 0.0 | 0.0 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 0.0 | $ 0.0 | ||||||||
Interest rate | 0.00% | 0.00% | ||||||||
Term ABS 2016-1 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 125.3 | ||||||||
Loans pledged as collateral | 0.0 | 320.8 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 0.0 | $ 29.6 | ||||||||
Interest rate | 0.00% | 4.41% | ||||||||
Term ABS 2016-2 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 0.0 | $ 184.5 | ||||||||
Loans pledged as collateral | 0.0 | 335.0 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 0.0 | $ 28.3 | ||||||||
Interest rate | 0.00% | 3.20% | ||||||||
Term ABS 2016-3 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 102.5 | $ 300.6 | ||||||||
Loans pledged as collateral | 254.3 | 392.7 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 26.2 | $ 30.7 | ||||||||
Interest rate | 3.29% | 2.59% | ||||||||
Term ABS 2017-1 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 181.3 | $ 350.0 | ||||||||
Loans pledged as collateral | 331.1 | 429.8 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 29.5 | $ 30.9 | ||||||||
Interest rate | 2.98% | 2.78% | ||||||||
Term ABS 2017-2 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 359.5 | $ 450.0 | ||||||||
Loans pledged as collateral | 482.6 | 548.4 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 40.8 | $ 39.4 | ||||||||
Interest rate | 2.77% | 2.72% | ||||||||
Term ABS 2017-3 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 350.0 | $ 350.0 | ||||||||
Loans pledged as collateral | 424.5 | 426.1 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 33.0 | $ 28.6 | ||||||||
Interest rate | 2.88% | 2.88% | ||||||||
Term ABS 2018-1 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 500.0 | $ 500.0 | ||||||||
Loans pledged as collateral | 609.1 | 614.5 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 46.4 | $ 41.8 | ||||||||
Interest rate | 3.24% | 3.24% | ||||||||
Term ABS 2018-2 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 450.0 | $ 450.0 | ||||||||
Loans pledged as collateral | 550.5 | 552.2 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 40.2 | $ 36.3 | ||||||||
Interest rate | 3.68% | 3.68% | ||||||||
Term ABS 2018-3 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 398.3 | $ 398.3 | ||||||||
Loans pledged as collateral | 498.6 | 578.8 | ||||||||
Restricted cash and cash equivalents pledged as collateral | $ 35.1 | $ 33.6 | ||||||||
Interest rate | 3.72% | 3.72% | ||||||||
Term ABS 2019-1 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 402.5 | |||||||||
Loans pledged as collateral | 491.0 | |||||||||
Restricted cash and cash equivalents pledged as collateral | $ 34.1 | |||||||||
Interest rate | 3.53% | |||||||||
Term ABS 2019-2 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Secured Debt | $ 500.0 | |||||||||
Loans pledged as collateral | 642.0 | |||||||||
Restricted cash and cash equivalents pledged as collateral | $ 40.1 | |||||||||
Interest rate | 3.13% | |||||||||
2021 Senior Notes [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Balance outstanding | $ 300.0 | $ 300.0 | ||||||||
Interest rate | 6.125% | 6.125% | ||||||||
2023 Senior Notes [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Balance outstanding | $ 250.0 | $ 250.0 | ||||||||
Interest rate | 7.375% | 7.375% | 7.50% | |||||||
Mortgages [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate | 3.73% | 3.85% | ||||||||
Mortgage note | $ 11.5 | $ 11.9 | ||||||||
|
Loans Receivable (Schedule of Loans Receivable) (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Jun. 30, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|---|---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | $ 7,072.8 | $ 6,873.6 | $ 6,225.2 | $ 6,005.2 | $ 5,780.1 | $ 5,049.0 |
Allowance for credit losses | (509.1) | (489.6) | (461.9) | (447.6) | (435.7) | (429.4) |
Loans receivable, net | 6,563.7 | 5,763.3 | ||||
Dealer Loans [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 4,559.3 | 4,466.0 | 4,141.0 | 4,030.2 | 3,918.4 | 3,518.1 |
Allowance for credit losses | (409.3) | (394.0) | (378.1) | (373.0) | (365.9) | (366.0) |
Loans receivable, net | 4,150.0 | 3,762.9 | ||||
Purchased Loans [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 2,513.5 | 2,407.6 | 2,084.2 | 1,975.0 | 1,861.7 | 1,530.9 |
Allowance for credit losses | (99.8) | $ (95.6) | (83.8) | $ (74.6) | $ (69.8) | $ (63.4) |
Loans receivable, net | $ 2,413.7 | $ 2,000.4 |
Restricted Securities Available for Sale (Schedule of Restricted Securities Available for Sale) (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
||
---|---|---|---|---|
Restricted Securities Available For Sale [Line Items] | ||||
Available-for-sale Securities, Amortized Cost Basis | $ 58.7 | $ 59.0 | ||
Gross Unrealized Gains | 1.1 | 0.1 | ||
Gross Unrealized Losses | 0.0 | (0.5) | ||
Estimated Fair Value | [1] | 59.8 | 58.6 | |
Corporate Bond Securities [Member] | ||||
Restricted Securities Available For Sale [Line Items] | ||||
Available-for-sale Securities, Amortized Cost Basis | 24.9 | 23.4 | ||
Gross Unrealized Gains | 0.6 | 0.0 | ||
Gross Unrealized Losses | 0.0 | (0.2) | ||
Estimated Fair Value | 25.5 | 23.2 | ||
US Government and Agency Securities [Member] | ||||
Restricted Securities Available For Sale [Line Items] | ||||
Available-for-sale Securities, Amortized Cost Basis | 22.0 | 24.8 | ||
Gross Unrealized Gains | 0.4 | 0.1 | ||
Gross Unrealized Losses | 0.0 | (0.2) | ||
Estimated Fair Value | 22.4 | 24.7 | ||
Asset-backed Securities [Member] | ||||
Restricted Securities Available For Sale [Line Items] | ||||
Available-for-sale Securities, Amortized Cost Basis | 11.0 | 9.4 | ||
Gross Unrealized Gains | 0.1 | 0.0 | ||
Gross Unrealized Losses | 0.0 | (0.1) | ||
Estimated Fair Value | 11.1 | 9.3 | ||
Mortgage-backed Securities [Member] | ||||
Restricted Securities Available For Sale [Line Items] | ||||
Available-for-sale Securities, Amortized Cost Basis | 0.8 | 1.4 | ||
Gross Unrealized Gains | 0.0 | 0.0 | ||
Gross Unrealized Losses | 0.0 | 0.0 | ||
Estimated Fair Value | $ 0.8 | $ 1.4 | ||
|
Summary of Significant Accounting Policies New Accounting Pronouncements (Narrative) (Details) - ASU 2016-13 [Member] |
9 Months Ended |
---|---|
Sep. 30, 2019 | |
Minimum [Member] | Net Income [Member] | |
Item Effected [Line Items] | |
New Accounting Pronouncement Estimated Impact | 30.00% |
Minimum [Member] | Loans Receivable [Member] | |
Item Effected [Line Items] | |
New Accounting Pronouncement Estimated Impact | 30.00% |
Minimum [Member] | Allowance for Credit Losses [Member] | |
Item Effected [Line Items] | |
New Accounting Pronouncement Estimated Impact | 12.00% |
Maximum [Member] | Net Income [Member] | |
Item Effected [Line Items] | |
New Accounting Pronouncement Estimated Impact | 60.00% |
Maximum [Member] | Loans Receivable [Member] | |
Item Effected [Line Items] | |
New Accounting Pronouncement Estimated Impact | 40.00% |
Maximum [Member] | Allowance for Credit Losses [Member] | |
Item Effected [Line Items] | |
New Accounting Pronouncement Estimated Impact | 15.00% |
Stock-Based Compensation Plans (Schedule of Stock Based Compensation Expense) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 2.0 | $ 2.7 | $ 5.7 | $ 7.8 |
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | 0.8 | 0.7 | 2.3 | 2.1 |
Restricted Stock Units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1.2 | $ 2.0 | $ 3.4 | $ 5.7 |
Loans Receivable (Summary of Changes in Loans Receivable) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
Sep. 30, 2019 |
Sep. 30, 2018 |
||||||||||
Loans and Leases Receivable, Net [Roll Forward] | |||||||||||||
Balance, beginning of period | $ 6,873.6 | $ 5,780.1 | $ 6,225.2 | $ 5,049.0 | |||||||||
New Consumer Loan assignments | [1] | 894.4 | 831.0 | 2,955.0 | 2,787.2 | ||||||||
Principal collected on Loans receivable | (746.3) | (647.3) | (2,254.9) | (1,949.0) | |||||||||
Accelerated Dealer Holdback payments | (16.1) | (11.6) | (44.1) | (41.0) | |||||||||
Dealer Holdback payments | 34.8 | 31.9 | 105.4 | 98.0 | |||||||||
Write-offs | (0.5) | (2.7) | (4.1) | (24.5) | |||||||||
Recoveries | [2],[3] | 0.7 | 0.6 | 2.1 | 3.5 | ||||||||
Balance, end of period | 7,072.8 | 6,005.2 | 7,072.8 | 6,005.2 | |||||||||
Dealer Loans [Member] | |||||||||||||
Loans and Leases Receivable, Net [Roll Forward] | |||||||||||||
Balance, beginning of period | 4,466.0 | 3,918.4 | 4,141.0 | 3,518.1 | |||||||||
New Consumer Loan assignments | [1] | 573.3 | 556.7 | 1,901.1 | 1,870.2 | ||||||||
Principal collected on Loans receivable | (510.8) | (466.0) | (1,562.2) | (1,425.2) | |||||||||
Accelerated Dealer Holdback payments | (16.1) | (11.6) | (44.1) | (41.0) | |||||||||
Dealer Holdback payments | 34.8 | 31.9 | 105.4 | 98.0 | |||||||||
Transfers | [4] | (20.3) | (20.2) | (67.6) | 53.3 | ||||||||
Write-offs | (0.3) | (2.5) | (3.7) | (21.3) | |||||||||
Recoveries | [2],[3] | 0.5 | 0.3 | 1.2 | 2.7 | ||||||||
Balance, end of period | 4,559.3 | 4,030.2 | 4,559.3 | 4,030.2 | |||||||||
Purchased Loans [Member] | |||||||||||||
Loans and Leases Receivable, Net [Roll Forward] | |||||||||||||
Balance, beginning of period | 2,407.6 | 1,861.7 | 2,084.2 | 1,530.9 | |||||||||
New Consumer Loan assignments | [1] | 321.1 | 274.3 | 1,053.9 | 917.0 | ||||||||
Principal collected on Loans receivable | (235.5) | (181.3) | (692.7) | (523.8) | |||||||||
Transfers | [4] | 20.3 | 20.2 | 67.6 | 53.3 | ||||||||
Write-offs | (0.2) | (0.2) | (0.4) | (3.2) | |||||||||
Recoveries | [2],[3] | 0.2 | 0.3 | 0.9 | 0.8 | ||||||||
Balance, end of period | $ 2,513.5 | $ 1,975.0 | $ 2,513.5 | $ 1,975.0 | |||||||||
|
Loans Receivable (Schedule of Consumer Loans Performance) (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Jun. 30, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|---|---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | $ 7,072.8 | $ 6,873.6 | $ 6,225.2 | $ 6,005.2 | $ 5,780.1 | $ 5,049.0 |
Allowance for credit losses | (509.1) | (489.6) | (461.9) | (447.6) | (435.7) | (429.4) |
Loans receivable, net | 6,563.7 | 5,763.3 | ||||
Loan Pool Performance Meets Or Exceeds Initial Estimates [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 3,516.4 | 2,747.2 | ||||
Loans receivable, net | 3,516.4 | 2,747.2 | ||||
Loan Pool Performance Less Than Initial Estimates [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 3,556.4 | 3,478.0 | ||||
Allowance for credit losses | (509.1) | (461.9) | ||||
Loans receivable, net | 3,047.3 | 3,016.1 | ||||
Dealer Loans [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 4,559.3 | 4,466.0 | 4,141.0 | 4,030.2 | 3,918.4 | 3,518.1 |
Allowance for credit losses | (409.3) | (394.0) | (378.1) | (373.0) | (365.9) | (366.0) |
Loans receivable, net | 4,150.0 | 3,762.9 | ||||
Dealer Loans [Member] | Loan Pool Performance Meets Or Exceeds Initial Estimates [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 1,585.3 | 1,355.1 | ||||
Loans receivable, net | 1,585.3 | 1,355.1 | ||||
Dealer Loans [Member] | Loan Pool Performance Less Than Initial Estimates [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 2,974.0 | 2,785.9 | ||||
Allowance for credit losses | (409.3) | (378.1) | ||||
Loans receivable, net | 2,564.7 | 2,407.8 | ||||
Purchased Loans [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 2,513.5 | 2,407.6 | 2,084.2 | 1,975.0 | 1,861.7 | 1,530.9 |
Allowance for credit losses | (99.8) | $ (95.6) | (83.8) | $ (74.6) | $ (69.8) | $ (63.4) |
Loans receivable, net | 2,413.7 | 2,000.4 | ||||
Purchased Loans [Member] | Loan Pool Performance Meets Or Exceeds Initial Estimates [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 1,931.1 | 1,392.1 | ||||
Loans receivable, net | 1,931.1 | 1,392.1 | ||||
Purchased Loans [Member] | Loan Pool Performance Less Than Initial Estimates [Member] | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Loans receivable | 582.4 | 692.1 | ||||
Allowance for credit losses | (99.8) | (83.8) | ||||
Loans receivable, net | $ 482.6 | $ 608.3 |
Reinsurance (Schedule of Trust Assets and Reinsurance Liabilities) (Details) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
||
---|---|---|---|---|
Trust Assets [Member] | ||||
Reinsurance [Line Items] | ||||
Restricted cash and cash equivalents | $ 0.4 | $ 0.3 | ||
Restricted securities available for sale | 59.8 | 58.6 | ||
Unearned Premium [Member] | ||||
Reinsurance [Line Items] | ||||
Accounts payable and accrued liabilities | 44.2 | 43.3 | ||
Claims Reserve [Member] | ||||
Reinsurance [Line Items] | ||||
Accounts payable and accrued liabilities | [1] | $ 2.0 | $ 1.6 | |
|
Description of Business (Percentage of Consumer Loans Assigned Based on Volumes) (Details) |
3 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Sep. 30, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
||||
Portfolio Program [Member] | ||||||||||
Description Of Business [Line Items] | ||||||||||
Percentage of new consumer loans unit volume | 67.20% | 66.70% | 67.40% | 69.40% | 69.50% | 69.70% | 70.10% | |||
Percentage of new consumer loans dollar volume | [1] | 64.10% | 63.70% | 65.00% | 67.40% | 67.00% | 66.80% | 67.40% | ||
Purchase Program [Member] | ||||||||||
Description Of Business [Line Items] | ||||||||||
Percentage of new consumer loans unit volume | 32.80% | 33.30% | 32.60% | 30.60% | 30.50% | 30.30% | 29.90% | |||
Percentage of new consumer loans dollar volume | [1] | 35.90% | 36.30% | 35.00% | 32.60% | 33.00% | 33.20% | 32.60% | ||
|
Stock Repurchases (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Stock Repurchases | The following table summarizes our stock repurchases for the nine months ended September 30, 2019 and 2018:
(2) Represents shares of common stock released to us by team members as payment of tax withholdings upon the vesting of restricted stock and restricted stock units and the conversion of restricted stock units to common stock.
|
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Sep. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Loans receivable, from affiliates | $ 0.0 | $ 0.0 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 18,796,770 | 18,972,558 |
Balance, shares | 18,796,770 | 18,972,558 |
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 30, 2019 |
Sep. 30, 2018 |
|
Cash Flows From Operating Activities: | ||
Net income | $ 494.2 | $ 422.1 |
Adjustments to reconcile cash provided by operating activities: | ||
Provision for credit losses | 49.2 | 39.2 |
Depreciation | 5.3 | 3.9 |
Amortization | 11.3 | 10.0 |
Provision for deferred income taxes | 34.2 | 48.5 |
Stock-based compensation | 5.7 | 7.8 |
Other | 0.1 | (0.2) |
Change in operating assets and liabilities: | ||
Increase (decrease) in accounts payable and accrued liabilities | (4.8) | 21.0 |
Increase in income taxes receivable | (2.9) | (18.0) |
Decrease in income taxes payable | (2.3) | (39.7) |
Decrease in other assets | 18.0 | 6.4 |
Net cash provided by operating activities | 608.0 | 501.0 |
Cash Flows From Investing Activities: | ||
Purchases of restricted securities available for sale | (32.8) | (35.6) |
Proceeds from sale of restricted securities available for sale | 24.9 | 17.3 |
Maturities of restricted securities available for sale | 8.1 | 7.2 |
Principal collected on Loans receivable | 2,254.9 | 1,949.0 |
Advances to Dealers | (1,901.1) | (1,870.2) |
Purchases of Consumer Loans | (1,053.9) | (917.0) |
Accelerated payments of Dealer Holdback | (44.1) | (41.0) |
Payments of Dealer Holdback | (105.4) | (98.0) |
Purchases of property and equipment | (23.6) | (22.1) |
Net cash used in investing activities | (873.0) | (1,010.4) |
Cash Flows From Financing Activities: | ||
Borrowings under revolving secured line of credit | 3,027.2 | 1,724.7 |
Repayments under revolving secured line of credit | (3,146.9) | (1,738.6) |
Proceeds from secured financing | 1,698.4 | 2,696.6 |
Repayments of secured financing | (1,563.0) | (1,886.0) |
Proceeds from issuance of senior notes | 400.0 | 0.0 |
Proceeds from mortgage note | 0.0 | 12.0 |
Payments of debt issuance costs | (15.9) | (13.0) |
Repurchase of common stock | (109.2) | (2.0) |
Other | (0.4) | (4.8) |
Net cash provided by financing activities | 290.2 | 788.9 |
Net increase in cash and cash equivalents and restricted cash and cash equivalents | 25.2 | 279.5 |
Cash and cash equivalents and restricted cash and cash equivalents beginning of period | 329.3 | 263.8 |
Cash and cash equivalents and restricted cash and cash equivalents end of period | 354.5 | 543.3 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid during the period for interest | 141.6 | 112.0 |
Cash paid during the period for income taxes | $ 116.7 | $ 136.6 |
Debt (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Principal Debt Outstanding | Debt consists of the following:
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Schedule of General Information of Financing Transaction | General information for each of our financing transactions in place as of September 30, 2019 is as follows:
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Schedule of Additional Information Related to Debt Instruments | Additional information related to the amounts outstanding on each facility is as follows:
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Summary of Debt |
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Summary of Term ABS Financings | The table below sets forth certain additional details regarding the outstanding Term ABS financings:
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Restricted Securities Available for Sale |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Securities Available for Sale | RESTRICTED SECURITIES AVAILABLE FOR SALE Restricted securities available for sale consist of the following:
The fair value and gross unrealized losses for restricted securities available for sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, are as follows:
The cost and estimated fair values of debt securities by contractual maturity were as follows (securities with multiple maturity dates are classified in the period of final maturity). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
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Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | DEBT Debt consists of the following:
General information for each of our financing transactions in place as of September 30, 2019 is as follows:
Additional information related to the amounts outstanding on each facility is as follows:
Revolving Secured Line of Credit Facility We have a $340.0 million revolving secured line of credit facility with a commercial bank syndicate. Borrowings under the revolving secured line of credit facility, including any letters of credit issued under the facility, are subject to a borrowing-base limitation. This limitation equals 80% of the value of Loans, as defined in the agreement, less a hedging reserve (not exceeding $1.0 million), and the amount of other debt secured by the collateral which secures the revolving secured line of credit facility. Borrowings under the revolving secured line of credit facility agreement are secured by a lien on most of our assets. Warehouse Facilities We have six Warehouse facilities with total borrowing capacity of $1,225.0 million. Each of the facilities is with a different lender or group of lenders. Under each Warehouse facility, we can contribute Loans to our wholly-owned subsidiaries in return for cash and equity in each subsidiary. In turn, each subsidiary pledges the Loans as collateral to lenders to secure financing that will fund the cash portion of the purchase price of the Loans. The financing provided to each subsidiary under the applicable facility is generally limited to the lesser of 80% of the value of the contributed Loans, as defined in the agreements, plus the restricted cash and cash equivalents pledged as collateral on such Loans or the facility limit. The financings create indebtedness for which the subsidiaries are liable and which is secured by all the assets of each subsidiary. Such indebtedness is non-recourse to us, even though we are consolidated for financial reporting purposes with the subsidiaries. Because the subsidiaries are organized as legal entities separate from us, their assets (including the contributed Loans) are not available to our creditors. The subsidiaries pay us a monthly servicing fee equal to 6% of the collections received with respect to the contributed Loans. The servicing fee is paid out of the collections. Except for the servicing fee and holdback payments due to Dealers, if a facility is amortizing, we do not have any rights in any portion of such collections until all outstanding principal, accrued and unpaid interest, fees and other related costs have been paid in full. If a facility is not amortizing, the applicable subsidiary may be entitled to retain a portion of such collections provided that the borrowing base requirements of the facility are satisfied. Term ABS Financings We have wholly-owned subsidiaries (the “Funding LLCs”) that have completed secured financing transactions with qualified institutional investors or lenders. In connection with these transactions, we contributed Loans on an arms-length basis to each Funding LLC for cash and the sole membership interest in that Funding LLC. In turn, each Funding LLC, other than that of Term ABS 2019-2, contributed the Loans to a respective trust that issued notes to qualified institutional investors. The Funding LLC for the Term ABS 2019-2 transaction pledged the Loans to a lender. The Term ABS 2016-3, 2017-1, 2017-2, 2017-3, 2018-1, 2018-2, 2018-3 and 2019-1 transactions each consist of three classes of notes. Each financing at the time of issuance has a specified revolving period during which we are likely to contribute additional Loans to each Funding LLC. Each Funding LLC will then contribute the Loans to its respective trust. At the end of the applicable revolving period, the debt outstanding under each financing will begin to amortize. The financings create indebtedness for which the trusts or Funding LLCs are liable and which is secured by all the assets of each trust or Funding LLC. Such indebtedness is non-recourse to us, even though we are consolidated for financial reporting purposes with the trusts and the Funding LLCs. Because the Funding LLCs are organized as legal entities separate from us, their assets (including the contributed Loans) are not available to our creditors. We receive a monthly servicing fee on each financing equal to 6% of the collections received with respect to the contributed Loans. The fee is paid out of the collections. Except for the servicing fee and Dealer Holdback payments due to Dealers, if a facility is amortizing, we do not have any rights in any portion of such collections until all outstanding principal, accrued and unpaid interest, fees and other related costs have been paid in full. If a facility is not amortizing, the applicable subsidiary may be entitled to retain a portion of such collections provided that the borrowing base requirements of the facility are satisfied. However, in our capacity as servicer of the Loans, we do have a limited right to exercise a “clean-up call” option to purchase Loans from the Funding LLCs and/or the trusts under certain specified circumstances. For those Funding LLCs with a trust, when the trust’s underlying indebtedness is paid in full, either through collections or through a prepayment of the indebtedness, the trust is to pay any remaining collections over to its Funding LLC as the sole beneficiary of the trust. For all Funding LLCs, after the indebtedness is paid in full, any remaining collections will ultimately be available to be distributed to us as the sole member of the respective Funding LLC. The table below sets forth certain additional details regarding the outstanding Term ABS financings:
Senior Notes On March 7, 2019, we issued $400.0 million aggregate principal amount of 6.625% senior notes due 2026 (the “2026 senior notes”). The 2026 senior notes were issued pursuant to an indenture, dated as of March 7, 2019, among the Company, as issuer, the Company’s subsidiaries Buyers Vehicle Protection Plan, Inc. and Vehicle Remarketing Services, Inc., as guarantors (collectively, the “Guarantors”), and U.S. Bank National Association, as trustee. The 2026 senior notes mature on March 15, 2026 and bear interest at a rate of 6.625% per annum, computed on the basis of a 360-day year composed of twelve 30-day months and payable semi-annually on March 15 and September 15 of each year, beginning on September 15, 2019. We used the net proceeds from the offering of the notes for general corporate purposes, including repayment of outstanding borrowings under our revolving secured line of credit facility. On March 30, 2015, we issued $250.0 million aggregate principal amount of 7.375% senior notes due 2023 (the “2023 senior notes”). The 2023 senior notes were issued pursuant to an indenture, dated as of March 30, 2015, among the Company, as issuer, the Company’s subsidiaries Buyers Vehicle Protection Plan, Inc. and Vehicle Remarketing Services, Inc., as guarantors (collectively, the “Guarantors”), and U.S. Bank National Association, as trustee. The 2023 senior notes mature on March 15, 2023 and bear interest at a rate of 7.375% per annum, computed on the basis of a 360-day year composed of twelve 30-day months and payable semi-annually on March 15 and September 15 of each year, beginning on September 15, 2015. The 2023 senior notes were issued at a price of 99.266% of their aggregate principal amount, resulting in gross proceeds of $248.2 million, and a yield to maturity of 7.5% per annum. We used the net proceeds from the offering of the notes for general corporate purposes, including repayment of outstanding borrowings under our revolving secured line of credit facility. On January 22, 2014, we issued $300.0 million aggregate principal amount of 6.125% senior notes due 2021 (the “2021 senior notes”). The 2021 senior notes were issued pursuant to an indenture, dated as of January 22, 2014, among the Company, the Guarantors, and U.S. Bank National Association, as trustee. The 2021 senior notes mature on February 15, 2021 and bear interest at a rate of 6.125% per annum, computed on the basis of a 360-day year composed of twelve 30-day months and payable semi-annually on February 15 and August 15 of each year, beginning on August 15, 2014. We used the net proceeds from the 2021 senior notes, together with borrowings under our revolving credit facilities, to redeem in full the $350.0 million aggregate principal amount of our 9.125% first priority senior secured notes due 2017 on February 21, 2014. All of the 2021, 2023 and 2026 senior notes (the "senior notes") are guaranteed on a senior basis by the Guarantors, which are also guarantors of obligations under our revolving secured line of credit facility. Other existing and future subsidiaries of ours may become guarantors of the senior notes in the future. The indentures for the senior notes provide for a guarantor of the senior notes to be released from its obligations under its guarantee of the senior notes under specified circumstances. Mortgage Note On August 6, 2018, we entered into a $12.0 million mortgage note with a commercial bank that is secured by a first mortgage lien on a building acquired by us and an assignment of all leases, rents, revenues and profits under all present and future leases of the building. The note matures on August 6, 2023, and bears interest at LIBOR plus 150 basis points. Debt Covenants As of September 30, 2019, we were in compliance with our covenants under the revolving secured line of credit facility, including those that require the maintenance of certain financial ratios and other financial conditions. These covenants require a minimum ratio of (1) our net earnings, adjusted for specified items, before income taxes, depreciation, amortization and fixed charges to (2) our fixed charges. These covenants also limit the maximum ratio of our funded debt less unrestricted cash and cash equivalents to tangible net worth. Additionally, we must maintain consolidated net income of not less than $1 for the two most recently ended fiscal quarters. Some of these covenants may indirectly limit the repurchase of common stock or payment of dividends on common stock. Our Warehouse facilities and Term ABS financings also contain covenants that measure the performance of the contributed assets. As of September 30, 2019, we were in compliance with all such covenants. As of the end of the quarter, we were also in compliance with our covenants under the senior notes indentures.
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