Ugly Duckling Reports Record Quarterly Results
PHOENIX--(BUSINESS WIRE)--April 19, 2000--Ugly Duckling Corp.
(NNM:UGLY):
First Quarter Highlights:
-- Net earnings totaled $4.5 million, or $0.30 per diluted share,
the highest quarterly EPS ever for the company, versus
earnings from continuing operations of $0.6 million or $0.04
per diluted share in the corresponding quarter of the prior
year.
-- Total revenues increased 33% to $159.1 million from $119.7
million in the corresponding quarter of the prior year.
-- E-Commerce provided $5.9 million in revenue and 701 cars sold
during the first quarter of 2000 versus $3.9 million in
revenue and 415 cars sold during the fourth quarter of 1999.
-- On-balance sheet loan portfolio principal balance reached
$418.9 million, representing a 17% increase over the fourth
quarter and a 130% rise over the year-ago quarter.
-- New loan originations reached $128.1 million, a 25% increase
over the same quarter of the prior year.
-- Completed the purchase of 1.1 million shares of common stock
on April 13, 2000, in exchange for $11.9 million, 11%
subordinated debentures.
Financial Highlights
(In thousands, except for percent
and per share numbers) Three Months Ended
3/31/00 3/31/99 % Increase
Total Revenues $159,124 $ 119,715 33%
Operating Income $ 9,892 $ 899 1,000%
Earnings - Continuing Operations $ 4,483 $ 619 625%
Diluted Earnings per Share -
Continuing Operations $ 0.30 $ 0.04 650%
*T
Ugly Duckling Corp. (NNM:UGLY), the largest and fastest-growing
used car sales company focused exclusively on the sub-prime market,
today reported record earnings for the first quarter 2000.
Strong Quarter over Quarter Results
For the three months ended March 31, 2000, Ugly Duckling achieved
earnings from continuing operations of $4,483,000, or $0.30 per
diluted share versus $619,000, or $0.04 per diluted share for the
three months ended March 31, 1999. The quarterly earnings and earnings
per share were the highest in the Company's history.
Total revenues reached $159,124,000 for the first quarter of 2000,
an increase of approximately 33% from total revenues of $119,715,000
in the first quarter of 1999. The increase is attributable to an
increased number of cars sold, together with growth in interest
income, offset by a decrease in servicing income.
The Company's car sales increased 24% to 15,802 cars sold in the
first quarter of 2000 versus 12,754 cars sold in the same quarter of
the previous year. The revenues and unit sales were also record highs
for the Company.
Interest income for the first quarter of 2000 increased
sequentially to $25,531,000 from $22,670,000 in the fourth quarter of
1999, a gain of 13%, and from $10,373,000 in the same period of the
prior year, an increase of over 146%. The increase in both periods is
primarily attributable to rapid growth of the Company's on-balance
sheet portfolio.
New loan originations for the first quarter of 2000 were
$128,123,000, representing a 58% increase from the $80,900,000
reported in the fourth quarter of 1999, and a 25% increase over the
$102,733,000 reported in the first quarter of 1999.
The current year quarter over prior year quarter increase is
primarily the result of the growth in the number of Ugly Duckling
dealerships coupled with an increase in sales from E-commerce related
business. The Company's dealerships increased in number to 75 in the
first quarter of 2000 from 58 in the same quarter of the prior year.
The increase in new loan originations in the first quarter of 2000
over fourth quarter of 1999 is a function of seasonality, as the first
quarter is historically the company's strongest sales quarter of the
year.
Operating expenses for the first quarter of 2000 were $36,688,000,
or 23% of total revenues, compared with operating expenses of
$28,970,000, or 24% of total revenues, for the previous year first
quarter. The slight decrease in operating expenses as a percentage of
revenue is primarily the result of continued efficiencies from the
Company's growth.
Greg Sullivan, President and Chief Executive Officer commented:
"We are very pleased with the first quarter results. We had good sales
volumes, excellent margins and continued to see some efficiencies
resulting from our growth. Most significantly, we continued the growth
in interest income that has been the primary driver of the growth in
net income since we went off gain on sale in the fourth quarter of
`98."
Portfolio
The Company achieved dramatic improvement in delinquency levels.
At the end of the first quarter 2000, 31+ day delinquencies dropped to
5.3%, down from 8.6% and 10.3% reported at the end of the fourth and
third quarter 1999, respectively.
"At the end of the third quarter, we told the investment community
that we were going to focus on bringing down our delinquency levels
and were confident that we would have delinquencies below 8% by the
end of March 2000," continued Sullivan. "Obviously, we have bettered
that goal significantly with 5.3% delinquencies at quarter end.
"We are extremely pleased by our progress in this area. And we are
even more pleased that we have been able to achieve these significant
improvements while keeping loan losses at acceptable levels. In fact,
net charge-offs in the first quarter were not only lower on a dollar
and percentage basis over the fourth quarter, they were also better on
both counts over the third quarter of `99.
"We are continuing to make enhancements to our loan servicing so
that we continue to see improvements in loan performance throughout
2000," Sullivan added.
E-Commerce Applications and Sales Accelerate
Ugly Duckling's Web site, located at uglyduckling.com,
provided significant growth in credit applications and car sales again
this quarter. The Web site provides potential customers with instant
credit applications as well as maps to the company's dealerships
nationwide.
The Company received 6,600 applications from customers initially
applying for credit through its Web site in the first quarter of 2000,
generating $5.9 million in revenue with 701 used car sales. In the
fourth quarter of 1999, the Company's Internet activity generated
revenues of over $3.9 million with 415 cars being sold.
The Company is finding that the E-commerce customer group is out
performing all other customers in terms of loan performance. The
Company is excited about the potential of its Web site-based
applications and plans to expand and enhance its efforts in this area.
Common Stock Exchange Offer
Just after quarter end, the Company acquired 1,085,415 of shares
of its common stock in exchange for $11.9 million of its 11% seven
year subordinated debt pursuant to an exchange offer commenced in
February 2000.
Investor Conference Call
Ugly Duckling will be holding an investor conference call to
discuss the Company's first quarter financial and operational results
at 11:30 a.m. Eastern (8:30 a.m. Phoenix) on April 19, 2000. Investors
will have the opportunity to listen to the conference call over the
Internet through Vcall at vcall.com.
To listen to the live call, go to the Web site at least 15 minutes
early to register, download, and install any necessary audio software.
For those who cannot listen to the live broadcast, a replay will be
available shortly after the call at vcall.com and on the
company's Web site at uglyduckling.com. |
