Nicholas Financial, Inc.
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FOR IMMEDIATE RELEASE

Contact: Ralph Finkenbrink
Nicholas Financial, Inc.
Ph # - (727) 726-0763
Fax # - (727) 726-2140
E-Mail - rfinkenbrink@nicfn

Investor Relations
Michael Marika
Ph # - (727) 726-0763
Fax # - (727) 726-2140
E-Mail - mmarika@nicfn.com

Stock Symbol:
         (NASDAQ): NICK.

Web Site -
         www.nicholasfinancial.com

Nicholas Financial Reports Results For
3rd
Quarter Ended December 31, 2007


 

 

Clearwater, Florida, - February 5, 2008 - Nicholas Financial, Inc. (NASDAQ: NICK), announced that revenue increased 8% to $12,614,000 for the three months ended December 31, 2007 as compared to $11,730,000 for the three months ended December 31, 2006. Net income decreased 19% to $2,236,000 for the three months ended December 31, 2007 as compared to $2,770,000 for the three months ended December 31, 2006. Diluted earnings per share decreased 19% to $0.22 for the three months ended December 31, 2007 as compared to $0.27 for the three months ended December 31, 2006.

Revenue increased 8% to $37,362,000 for the nine months ended December 31, 2007 as compared to $34,666,000 for the nine months ended December 31, 2006. Net income decreased 11% to $7,617,000 for the nine months ended December 31, 2007 as compared to $8,568,000 for the nine months ended December 31, 2006. Diluted earnings per share decreased 11% to $0.74 for the nine months ended December 31, 2007 as compared to $0.83 for the nine months ended December 31, 2006.

The Company is very pleased to announce that BMO Capital Markets, a wholly owed subsidiary of Bank of Montreal, has joined our consortium of lenders, led by Bank of America. The Company now has a team of lenders comprised of Bank of America, 1st Horizon Bank, Capital One Bank, BMO Capital and Bank of Scotland.

The Company will be opening up two (2) new branch offices during the next 30 days. We will be adding a second branch location in Birmingham, Alabama and a second location in Indianapolis, Indiana.

Business has been very challenging this year as our typical customer is coping with both higher gasoline prices and a weaker employment environment. The Company believes the economic stimulus package that our government is proposing will be implemented quickly and will be helpful to many of our customers.

Founded in 1985, with assets of $184,847,000, Nicholas Financial, Inc. is one of the largest publicly traded specialty consumer finance companies based in the Southeast. The Company presently operates out of 46 branch locations in both the Southeast and the Mid-West States. The Company has approximately 10,055,000 shares of common stock outstanding. For an index of Nicholas Financial Inc.’s news releases or to obtain a specific release, visit our web site at
 www.nicholasfinancial.com.

Download Adobe Acrobat version of this press release.

 


 

 

 

Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements that involve risks and uncertainties including competitive factors, the management of growth, and other risks detailed from time to time in the Company’s filings and reports with the Securities and Exchange Commission including the Company’s Annual Report on Form 10-K for the year ended March 31, 2007. Such statements are based on the beliefs of the Company’s management as well as assumptions made by and information currently available to Company management. Actual events or results may differ materially. All forward looking statements and cautionary statements included in this document are made as of the date hereby based on information available to the Company as of the date hereof, and the Company assumes no obligation to update any forward looking statement or cautionary statement.

 

NICHOLAS FINANCIAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited, Dollars in Thousands, Except Per Share Amounts)


 

 

Three Months Ended
December 31,

Nine Months Ended
December 31,

2007

2006

2007

2006

Revenue:
    Interest income on 
          finance
receivables

12,593

11,707

37,301

34,576

    Sales

            21

            23

          61

          90

      12,614

      11,730

      37,362

      34,666

Expenses:
    Operating

4,982

4,604

14,983

13,871

    Provision for credit losses

2,467

1,194

5,281

2,856

    Interest expense

       1,611

       1,452

        4,843

        4,075

       9,060

       7,250

       25,107

       20,802

         
Operating income before
     income taxes

       3,554

       4,480

12,255

13,864

Income tax expense

       1,318

       1,710

        4,638

        5,296

    Net income

   $   2,236
=======

   $   2,770
=======

   $  7,617
=======

   $  8,568
=======

..
Earnings per share:
    Basic

    $    0.22
=======

    $    0.28
=======

     $   0.76
=======

     $   0.86
=======

    Diluted

    $    0.22
=======

    $    0.27
=======

     $   0.74
=======

     $   0.83
=======

..
Weighted average shares

10,045,000
=======

9,935,000
=======

10,028,000
=======

9,927,000
=======

..
Weighted average shares
    and assumed dilution


10,298,000
=======


10,264,000
=======

10,346,000
=======

10,270,000
=======

 

NICHOLAS FINANCIAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, Dollars in Thousands)


 

 

December 31,

March 31,

2007     

2007    

Cash

$       4,705

$        1,499

Finance receivables, net

171,939

164,365

Other Assets

       8,203

      7,155


    Total Assets


$   184,847

=======


$   173,019

=======

Line of credit

   99,903

$     94,012

Other liabilities

       7,880

       9,200

    Total liabilities

107,783

103,212

..
Shareholder's equity

     77,064

     69,807

Total liabilities &
    Shareholders' equity


    $   184,847
=======


    $   173,019
=======

 


 

 

Portfolio Summary

         Three Months Ended
         December
31

         Nine Months Ended
         December
31

         2007

         2006

         2007

         2006

Average finance receivables, net of unearned interest (1)


$ 192
,408,861
============


$ 1
74,444,124
============

$   189,618,834
============

$   169,638,227
============


Average indebtedness (2)

 
$   98,899
,680
============

 
$   88,950
,919
============

 $    96,177,013
============

 $    85,716,061
============


Finance revenue (3)

$     12,593,397

$     11,706,732

$    37,301,655

$    34,575,726


Interest expense
          1,610,758           1,451,647            4,842,628            4,074,541

Net finance revenue


$    10,982
,639
============


$    10,255
,086
============

$   32,459,027
============

$   30,501,185
============


Weighted average contractual rate (4)


24.14%
============


23.78%
============

24.25%
============

23.95%
============


Average Cost of Borrowed Funds (2)


6.51%
============


6.53%
============

6.71%
============

6.34%
============


Gross Portfolio Yield (5)

26.18%

26.84%


26.23%
 


27.18%
 

Interest expense as a percentage of average finance receivables, net of unearned interest

3.35%

3.33%

3.41%

3.20%


Provision for credit losses as a percentage of average finance receivables, net of unearned interest
               5.13%                2.74%                3.71%                2.24%

Net portfolio yield (5)

17.70%

20.77%

19.11%

21.74%


Operating expenses as a percentage of average finance receivables, net of unearned interest (6)
               10.23%                10.46%               10.41%               10.80%

Pre-tax yield as a percentage of average finance receivables, net of unearned interest (7)




7.47%
============




10.31%
============

8.70%
============

10.94%
============


Write-off to liquidation (8)


10.35%


7.96%


8.77%


6.91%


Net charge-off percentage (9)
 

9.51%
 

7.38%
 

7.98%
 

6.47%
 

Note: All three and nine month key performance indicators expressed as percentages have been annualized

(1)  Average finance receivables, net of unearned interest, represents the average of gross finance receivables, less unearned interest throughout the period.

(2)  Average indebtedness represents the average outstanding borrowings under the Line and notes payable-related party.  Average cost of borrowed funds represents interest expense as a percentage of average indebtedness. 

(3)  Finance revenue does not include revenue generated by Nicholas Data Services, Inc. (NDS) the wholly-owned software subsidiary of Nicholas Financial, Inc.

(4)  Weighted average contractual rate represents the weighted average annual percentage rate (APR) of all Contracts purchased and direct loans originated during the period.    

(5)  Gross portfolio yield represents finance revenues as a percentage of average finance receivables, net of unearned interest. Net portfolio yield represents finance revenue minus (a) interest expense and (b) the provision for credit losses as a percentage of average finance receivables, net of unearned interest. 

(6)  Operating expenses represent total expenses, less interest expense, the provision for credit losses and operating costs associated with NDS.

(7)  Pre-tax yield represents net portfolio yield minus operating expenses as a percentage of average finance receivables, net of unearned interest.

(8)  Write-off to liquidation percentage is defined as net charge-offs divided by liquidation. Liquidation is defined as beginning receivable balance plus current period purchases minus voids and refinances minus ending receivable balance.

(9)  Net charge-off percentage represents net charge-offs divided by average finance receivables, net of unearned interest,
              outstanding during the period.

 


 

 

The following tables present certain information regarding delinquency rates experienced by the Company with respect to Contracts and under its direct loan program.
 

 

At December 31,

2007

2006

Contracts    
Gross Balance Outstanding

$ 256,278,730

$ 233,992,372

         

Delinquencies

 

 

 

 

 
30 to 59 days

$8,908,945

3.48%

$4,942,628

2.11%

60 to 89 days

2,933,134

1.14%

1,682,993

0.72%

90 + days

  1,402,143

      0.55%

    691,092

      0.30%

         
Total Delinquencies

$10,989,625

 

$10,052,202

 
         
Direct Loans        
Gross Balance Outstanding

$ 10,052,202

$ 7,904,426

..
Delinquencies        
         
30 to 59 days

$212,084

1.93%

$94,912

0.95%

60 to 89 days

77,503

0.71%

55,635

0.55%

90 + days

      91,271

      0.83%

      25,482

      0.25%

         
Total Delinquencies

$380,858

3.47%

$176,029

1.75%

 


 

 

The following tables presents selected information on Contracts purchased by the Company, net of unearned interest.

Three Months Ended
December 31

Nine Months Ended
December 31

Contracts

2007

2006

2007

2006

Purchases

$25,469,763

$29,101,987

$83,498,826

$85,834,957

Weighted APR

24.08%

23.66%

24.13%

23.84%

Avg. Discount

8.34%

8.53%

8.18%

8.46%

Weighted Avg.
Term
(months)

48

46

48

46

Average Loan

$  9,316

$  9,100

$  9,369

$  9,073

# of Contracts    2,734    3,198        8,912        9,460

 



Contact Information

Telephone
727-726-0763
FAX
727-726-2140
Postal address
2454 McMullen-Booth Rd., Bldg. C, Clearwater, FL 33759
Electronic mail
Nicholas Employee E-Mail Directory
Investor Information: mmarika@nicfn.com
Webmaster: mmarika@nicfn.com

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