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Share Name | Share Symbol | Market | Type |
---|---|---|---|
CURO Group Holdings Corp | NYSE:CURO | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.095 | 0 | 01:00:00 |
Delaware | 90-0934597 | |||||||
(State or other jurisdiction Of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
200 W Hubbard Street, 8th Floor, Chicago, IL | 60654 | |||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common stock, $0.001 par value per share | CURO | New York Stock Exchange |
Large accelerated filer | ☐ | Accelerated filer | ☒ | |||||||||||
Non-accelerated filer | ☐ | |||||||||||||
Smaller reporting company | ☒ | Emerging growth company | ☐ |
Page | |||||||||||||||||||||||
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Item 15. | Exhibits, Financial Statement Schedules | ||||||||||||||||||||||
Item 16. | |||||||||||||||||||||||
Term or abbreviation | Definition | |||||||
2021 Form 10-K | Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 7, 2022 | |||||||
7.50% Senior Secured Notes | 7.50% Senior Secured Notes, issued in July 2021 for $750.0 million, which mature in August 2028 | |||||||
8.25% Senior Secured Notes | 8.25% Senior Secured Notes, issued in August 2018 for $690.0 million, which were extinguished during the third quarter of 2021 | |||||||
Ad Astra | Ad Astra Recovery Services, Inc., a wholly-owned subsidiary of the Company, which, prior to acquisition in January 2020, was our exclusive provider of third-party collection services for the legacy Direct Lending U.S. business. The Company ceased operations of Ad Astra in January 2023. | |||||||
ABL | Asset-Backed Lending | |||||||
Adjusted EBITDA | EBITDA plus or minus certain non-cash and other adjusting items; Refer to "Supplemental Non-GAAP Financial Information" for additional details | |||||||
ALL | Allowance for loan losses | |||||||
AOCI | Accumulated other comprehensive income (loss) | |||||||
ASC | Accounting Standards Codification | |||||||
ASU | Accounting Standards Update | |||||||
Average gross loans receivable | Utilized to calculate product yield and NCO rates; calculated as average of beginning of quarter and end of quarter gross loans receivable | |||||||
BNPL | Buy-Now-Pay-Later | |||||||
bps | Basis points | |||||||
C$ | Canadian dollar | |||||||
CAB | Credit Access Business | |||||||
Canada SPV | A four-year revolving credit facility with capacity up to C$400.0 million | |||||||
Curo Canada Revolving Credit Facility | C$5.0 million revolving credit facility (formerly known as Cash Money Revolving Credit Facility), maintained by CURO Canada. This facility was terminated in January 2023. | |||||||
CDOR | Canadian Dollar Offered Rate | |||||||
CECL | In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU requires an impairment model (known as the current expected credit loss (“CECL”) model) that is based on expected rather than incurred losses, with an anticipated result of more timely loss recognition. This guidance will be effective for us on January 1, 2023. | |||||||
CODM | Chief Operating Decision Maker | |||||||
Community Choice Financial | Community Choice Financial Inc., a consumer financial services company based in Dublin, Ohio, which we sold our Legacy U.S. Direct Lending Business to on July 8, 2022 | |||||||
CSO | Credit services organization | |||||||
Curo Canada | Curo Canada Corp, a wholly-owned Canadian subsidiary of the Company, formerly known as Cash Money Cheque Cashing Inc. | |||||||
Curo Receivables Finance II, LLC | A U.S. bankruptcy remote special purpose vehicle and an indirect wholly-owned subsidiary of the Company | |||||||
EBITDA | Earnings Before Interest, Taxes, Depreciation and Amortization | |||||||
Exchange Act | Securities Exchange Act of 1934, as amended | |||||||
FASB | Financial Accounting Standards Board | |||||||
FinServ | FinServ Acquisition Corp., a publicly traded special purpose acquisition company | |||||||
FinTech | Financial Technology; the term used to describe any technology that delivers financial services through software, such as online banking, mobile payment apps or cryptocurrency | |||||||
First Heritage | First Heritage Credit, LLC, a wholly-owned U.S. subsidiary of the Company, which we acquired in July 2022 | |||||||
First Heritage SPV | A revolving credit facility, entered into concurrent with the acquisition of First Heritage, with capacity up to $225.0 million | |||||||
Flexiti | Flexiti Financial Inc., a wholly-owned Canadian subsidiary of the Company, which we acquired in March 2021 | |||||||
Flexiti Securitization | A non-recourse revolving credit facility, entered into on December 9, 2021, with capacity up to C$526.5 million |
Term or abbreviation | Definition | |||||||
Flexiti SPV | A revolving credit facility, entered into concurrent with the acquisition of Flexiti, with capacity up to C$535.0 million | |||||||
Form 10-K | This report on Form 10-K for the year ended December 31, 2022 | |||||||
Gross Combined Loans Receivable | Gross loans receivable plus loans originated by third-party lenders which are Guaranteed by the Company. As a result of the sale of the Legacy U.S. Direct Lending business on July 8, 2022, the Company no longer guarantees loans originated by third-party lenders through CSO programs | |||||||
Guaranteed by the Company | Loans originated by third-party lenders through the CSO program which we historically guaranteed but did not include in the Consolidated Financial Statements. All balances in connection with the CSO programs were disposed of on July 8, 2022 with the divestiture of the Legacy U.S. Direct Lending Business. | |||||||
Heights Finance | SouthernCo, Inc., a Delaware corporation d/b/a Heights Finance, a wholly-owned U.S. subsidiary of the Company, which we acquired in December 2021 | |||||||
Heights Finance SPV | A non-recourse revolving credit facility, entered into concurrent with the acquisition of Heights Finance, with capacity up to $350.0 million. This facility was extinguished on July 15, 2022 when we entered into a new non-recourse revolving warehouse facility, see "Heights SPV." | |||||||
Heights SPV | A revolving credit facility, entered into to replace the incumbent lender's facility and finance future loans originated by Heights Finance, with capacity up to $425.0 million | |||||||
ICFR | Internal control over financial reporting | |||||||
Katapult | Katapult Holdings, Inc. a lease-to-own platform for online, brick and mortar and omni-channel retailers. | |||||||
Legacy U.S. Direct Lending Business | The Legacy U.S. Direct Lending Business historically operated under the Speedy Cash, Rapid Cash and Avio Credit brands. We sold the Legacy U.S. Direct Lending Business to Community Choice Financial on July 8, 2022. | |||||||
LFL | LFL Group, Canada's largest home furnishings retailer. | |||||||
LIBOR | London Inter-Bank Offered Rate | |||||||
MDR | Merchant discount revenue | |||||||
NCO | Net charge-off; total charge-offs less total recoveries | |||||||
POS | Point-of-sale | |||||||
ROU | Right of use | |||||||
RSU | Restricted Stock Unit | |||||||
SEC | U.S. Securities and Exchange Commission | |||||||
Senior Revolver | Senior Secured Revolving Loan Facility with borrowing capacity of $40.0 million as of December 31, 2022 | |||||||
Sequential | The change from one quarter to the next fiscal quarter | |||||||
SOFR | Secured Overnight Financing Rate | |||||||
SPAC | Special Purpose Acquisition Company | |||||||
SPE | Special Purpose Entity | |||||||
SPV | Special Purpose Vehicle | |||||||
SRC | Smaller Reporting Company as defined by the SEC | |||||||
TDR | Troubled Debt Restructuring. Debt restructuring for which a concession is granted to the borrower as a result of economic or legal reasons related to the borrower's financial difficulties | |||||||
UDAAP | Unfair, deceptive, or abusive acts and practices | |||||||
U.K. Subsidiaries | Collectively, Curo Transatlantic Limited and SRC Transatlantic Limited. These wholly-owned subsidiaries were placed into administration in February 2019. | |||||||
U.S. | United States of America | |||||||
U.S. GAAP | Accounting principles generally accepted in the U.S. | |||||||
U.S. SPV | An asset-backed revolving credit facility with capacity up to $200.0 million if certain conditions are met. This facility was extinguished on July 7, 2022. | |||||||
VIE | Variable Interest Entity; our wholly-owned, bankruptcy-remote special purpose subsidiaries |
For the Year Ended | ||||||||||||||||||||||||||||||||||||||
December 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||
(in thousands) | U.S. Direct Lending | Canada Direct Lending | Canada POS Lending | Total | % of Total | U.S. Direct Lending | Canada Direct Lending | Canada POS Lending | Total | % of Total | ||||||||||||||||||||||||||||
Revolving LOC | $ | 57,269 | $ | 193,212 | $ | 95,332 | $ | 345,813 | 33.7 | % | $ | 106,302 | $ | 156,000 | $ | 32,289 | $ | 294,591 | 36.0 | % | ||||||||||||||||||
Installment | 511,538 | 48,056 | — | 559,594 | 54.5 | % | 405,409 | 43,735 | — | 449,144 | 54.9 | % | ||||||||||||||||||||||||||
Total interest and fees revenue | 568,807 | 241,268 | 95,332 | 905,407 | 88.3 | % | 511,711 | 199,735 | 32,289 | 743,735 | 90.9 | % | ||||||||||||||||||||||||||
Insurance premiums and commissions | 31,594 | 54,561 | 2,335 | 88,490 | 8.6 | % | 275 | 48,714 | 421 | 49,410 | 6.0 | % | ||||||||||||||||||||||||||
Other revenue | 15,321 | 7,921 | 8,779 | 32,021 | 3.1 | % | 13,976 | 8,590 | 2,132 | 24,698 | 3.0 | % | ||||||||||||||||||||||||||
Total revenue | $ | 615,722 | $ | 303,750 | $ | 106,446 | $ | 1,025,918 | 100.0 | % | $ | 525,962 | $ | 257,039 | $ | 34,842 | $ | 817,843 | 100.0 | % |
For the Year Ended | ||||||||||||||||||||||||||||||||||||||
December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||||||||
(in thousands) | U.S. Direct Lending | Canada Direct Lending | Canada POS Lending | Total | % of Total | U.S. Direct Lending | Canada Direct Lending | Canada POS Lending | Total | % of Total | ||||||||||||||||||||||||||||
Revolving LOC | $ | 106,302 | $ | 156,000 | $ | 32,289 | $ | 294,591 | 36.0 | % | $ | 134,449 | $ | 115,053 | $ | — | $ | 249,502 | 29.4 | % | ||||||||||||||||||
Installment | 405,409 | 43,735 | — | 449,144 | 54.9 | % | 489,057 | 49,628 | — | 538,685 | 63.6 | % | ||||||||||||||||||||||||||
Total interest and fees | 511,711 | 199,735 | 32,289 | 743,735 | 90.9 | % | 623,506 | 164,681 | — | 788,187 | 93.0 | % | ||||||||||||||||||||||||||
Insurance premiums and commissions | 275 | 48,714 | 421 | 49,410 | 6.0 | % | — | 35,553 | — | 35,553 | 4.2 | % | ||||||||||||||||||||||||||
Other revenue | 13,976 | 8,590 | 2,132 | 24,698 | 3.0 | % | 15,018 | 8,638 | — | 23,656 | 66.5 | % | ||||||||||||||||||||||||||
Total revenue | $ | 525,962 | $ | 257,039 | $ | 34,842 | $ | 817,843 | 100.0 | % | $ | 638,524 | $ | 208,872 | $ | — | $ | 847,396 | 100.0 | % |
(in thousands) | For the Year Ended December 31, | |||||||||||||
2022 | 2021 | 2020 | ||||||||||||
Revenue | ||||||||||||||
Interest and fees revenue | $ | 905,407 | $ | 743,735 | $ | 788,188 | ||||||||
Insurance premiums and commissions | 88,490 | 49,411 | 35,553 | |||||||||||
Other revenue | 32,021 | 24,697 | 23,655 | |||||||||||
Total revenue | 1,025,918 | 817,843 | $ 847,396 | |||||||||||
Provision for losses | 400,325 | 245,668 | 288,811 | |||||||||||
Net revenue | 625,593 | 572,175 | 558,585 | |||||||||||
Operating Expenses | ||||||||||||||
Salaries and benefits | 281,636 | 237,109 | 196,817 | |||||||||||
Occupancy | 59,485 | 55,559 | 57,271 | |||||||||||
Advertising | 32,143 | 38,762 | 44,552 | |||||||||||
Direct operations | 64,128 | 60,056 | 46,893 | |||||||||||
Depreciation and amortization | 36,322 | 26,955 | 17,498 | |||||||||||
Other operating expense | 82,811 | 68,473 | 47,048 | |||||||||||
Total operating expenses | 556,525 | 486,914 | 410,079 | |||||||||||
Other expense (income) | ||||||||||||||
Interest expense | 185,661 | 97,334 | 72,709 | |||||||||||
Loss (income) from equity method investment | 3,985 | (3,658) | — | |||||||||||
Gain from equity method investment | — | (135,387) | (4,546) | |||||||||||
Goodwill impairment | 145,241 | — | — | |||||||||||
Loss on extinguishment of debt | 4,391 | 40,206 | — | |||||||||||
(Gain) loss on change in fair value of contingent consideration | (7,605) | 6,209 | — | |||||||||||
Gain on sale of business | (68,443) | — | — | |||||||||||
Total other expense (income) | 263,230 | 4,704 | 68,163 | |||||||||||
(Loss) income from continuing operations before income taxes | (194,162) | 80,557 | 80,343 | |||||||||||
(Benefit) provision for income taxes | (8,678) | 21,223 | 5,895 | |||||||||||
Net (loss) income from continuing operations | (185,484) | 59,334 | 74,448 | |||||||||||
Net income from discontinued operations, net of tax | — | — | 1,285 | |||||||||||
Net (loss) income | $ | (185,484) | $ | 59,334 | $ | 75,733 |
(in thousands, except percentages, unaudited) | Q4 2022 | Q3 2022 | Q2 2022(2) | Q1 2022 | Q4 2021(1) | ||||||||||||||||||
Gross loans receivable | |||||||||||||||||||||||
Revolving LOC | $ | — | $ | — | $ | 58,471 | $ | 49,077 | $ | 52,532 | |||||||||||||
Installment loans | 773,380 | 739,100 | 627,651 | 589,652 | 137,782 | ||||||||||||||||||
Total gross loans receivable (3) | $ | 773,380 | $ | 739,100 | $ | 686,122 | $ | 638,729 | $ | 190,314 | |||||||||||||
Lending Revenue: | |||||||||||||||||||||||
Revolving LOC | $ | — | $ | 2,210 | $ | 28,145 | $ | 26,913 | $ | 27,911 | |||||||||||||
Installment loans (4) | 88,001 | 90,834 | 169,878 | 162,824 | 104,168 | ||||||||||||||||||
Total lending revenue | $ | 88,001 | $ | 93,044 | $ | 198,023 | $ | 189,737 | $ | 132,079 | |||||||||||||
Lending Provision: | |||||||||||||||||||||||
Revolving LOC | $ | — | $ | — | $ | 11,831 | $ | 9,577 | $ | 11,592 | |||||||||||||
Installment loans (5) | 42,523 | 29,045 | 83,181 | 54,711 | 44,585 | ||||||||||||||||||
Total lending provision | $ | 42,523 | $ | 29,045 | $ | 95,012 | $ | 64,288 | $ | 56,177 | |||||||||||||
NCOs (6) | |||||||||||||||||||||||
Revolving LOC | $ | — | $ | 1,140 | $ | 10,248 | $ | 10,055 | $ | 11,481 |
(in thousands, except percentages, unaudited) | Q4 2022 | Q3 2022 | Q2 2022(2) | Q1 2022 | Q4 2021(1) | ||||||||||||||||||
Installment loans (7) | 34,664 | 27,311 | 68,152 | 57,739 | 45,729 | ||||||||||||||||||
Total NCOs | $ | 34,664 | $ | 28,451 | $ | 78,400 | $ | 67,794 | $ | 57,210 | |||||||||||||
NCO rate (annualized) (6) (8) | |||||||||||||||||||||||
Revolving LOC | —% | 15.6% | 76.4% | 79.2% | 88.4% | ||||||||||||||||||
Installment loans | 18.4% | 16.0% | 44.8% | 63.6% | 132.8% | ||||||||||||||||||
Total NCO rate (9) | 18.4% | 15.6% | 44.0% | 58.8% | 97.6% | ||||||||||||||||||
ALL rate (10) | |||||||||||||||||||||||
Revolving LOC | — | % | — | % | 25.1% | 26.7% | 25.9% | ||||||||||||||||
Installment loans | 5.2 | % | 4.4 | % | 8.1% | 5.4% | 17.7% | ||||||||||||||||
Total ALL rate (11) | 5.2 | % | 4.4 | % | 8.9% | 6.6% | 16.0% | ||||||||||||||||
31+ days past-due rate (10) | |||||||||||||||||||||||
Revolving LOC | — | % | — | % | 17.4% | 19.1% | 19.2% | ||||||||||||||||
Installment loans | 9.9 | % | 10.5 | % | 20.5% | 19.0% | 19.0% | ||||||||||||||||
Total past-due rate(12) | 9.9 | % | 10.5 | % | 10.1% | 10.0% | 9.7% | ||||||||||||||||
(1) On December 27, 2021, we acquired Heights Finance, which accounted for approximately $472 million of U.S. Direct Lending Installment loans as of December 31, 2021. As the period between December 27, 2021 and December 31, 2021 did not result in material loan performance, we have excluded Heights Finance from the table for the fourth quarter of 2021. | ||||||||||||||||||||||||||||||||||||||
(2) Includes loan balances and activity classified as Held for Sale. | ||||||||||||||||||||||||||||||||||||||
(3)Total combined gross loans receivable including receivables from installment loans originated by third-party lenders through CSO programs and guaranteed by the Company were $737.4 million,$683.1 million and $236.6 million as of June 30, 2022, March 31, 2022 and December 31, 2021, respectively, including installment loans – guaranteed by the Company of $51.3 million, $44.4 million and $46.3 million as of June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending business. Total Gross Combined Loans Receivable and installment loans – guaranteed by the Company are non-GAAP measures. For a description of each non-GAAP metric, see "Non-GAAP Financial Measures.” | ||||||||||||||||||||||||||||||||||||||
(4) Includes lending revenue from installment loans originated by third-party lenders through CSO programs and guaranteed by the Company of $3.9 million,$48.3 million, $49.0 million and $47.3 million for the three months ended September 30, 2022, June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending Business. | ||||||||||||||||||||||||||||||||||||||
(5) Includes provision from installment loans originated by third-party lenders through CSO programs and guaranteed by the Company of $28.3 million, $21.7 million and $26.0 million for the three months ended June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending Business. | ||||||||||||||||||||||||||||||||||||||
(6) NCOs presented above include $0.0 million, $0.5 million, $10.3 million and $5.0 million, for the three months ended December 31, 2022, September 30, 2022, June 30, 2022 and March 31, 2022, respectively, related to the purchase accounting fair value discount, which are excluded from provision. | ||||||||||||||||||||||||||||||||||||||
(7) Total NCOs included NCOs for installment loans originated by third-party lenders through CSO programs and guaranteed by the Company of $1.6 million, $27.4 million, $21.5 million and $26.07 million for the three months ended September 30, 2022, June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending Business. | ||||||||||||||||||||||||||||||||||||||
(8) We calculate NCO rate as total quarterly NCOs divided by Average gross loans receivable, then we annualize the rate. The amount and timing of recoveries are impacted by our collection strategies, which are based on customer behavior and risk profile and include direct customer communications and the periodic sale of charged off loans. | ||||||||||||||||||||||||||||||||||||||
(9) Total NCO rate included the NCO rate for installment loans originated by third-party lenders through CSO programs and guaranteed by the Company was 24.8%, 228.8%, 189.6% and 232.4% for the three months ended September 30, 2022, June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending Business. | ||||||||||||||||||||||||||||||||||||||
(10) We calculate (i) Allowance for loan losses (ALL) rate and (ii) past-due rate as the respective totals divided by gross loans receivable at each respective quarter end. | ||||||||||||||||||||||||||||||||||||||
(11)Total CSO liability for losses for installment loans originated by third-party lenders through CSO programs and guaranteed by the Company was 0%, 15.7%, 16.1% and 14.9% for the three months ended September 30, 2022, June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending business. Total U.S. Direct Lending ALL and CSO liability for losses rate was 8.9%, 6.6% and 16.0% for the three months ended June 30, 2022, March 31, 2022 and December 31, 2021, respectively. | ||||||||||||||||||||||||||||||||||||||
(12) Total past-due rate included the past-due rate for installment loans originated by third-party lenders through CSO programs and guaranteed by the Company was 2.6%, 4.5% and 3.1% for the three months ended June 30, 2022, March 31, 2022 and December 31, 2021, respectively. All balances in connection with the CSO programs were disposed of on July 8, 2022 upon closing of the divestiture of the Legacy U.S. Direct Lending Business. | ||||||||||||||||||||||||||||||||||||||
For the Year Ended December 31, | |||||||||||
(dollars in thousands, unaudited) | 2022 | 2021 | 2020 | ||||||||
Revenue | |||||||||||
Interest and fees revenue | $ | 568,807 | $ | 511,711 | $ | 623,507 | |||||
Insurance premiums and commissions | 31,594 | 275 | — | ||||||||
Other revenue | 15,321 | 13,976 | 15,017 | ||||||||
Total revenue | 615,722 | 525,962 | $ 638,524 | ||||||||
Provision for losses | 240,578 | 166,033 | 230,164 | ||||||||
Net revenue | 375,144 | 359,929 | 408,360 | ||||||||
Operating Expenses | |||||||||||
Salaries and benefits | 200,930 | 170,508 | 151,344 | ||||||||
Occupancy | 36,000 | 32,565 | 35,814 | ||||||||
Advertising | 27,038 | 33,223 | 40,702 | ||||||||
Direct operations | 38,306 | 35,899 | 39,112 | ||||||||
Depreciation and amortization | 18,094 | 12,005 | 12,992 | ||||||||
Other operating expenses | 63,076 | 54,508 | 35,357 | ||||||||
Total operating expenses | 383,444 | 338,708 | 315,321 | ||||||||
Other expense (income) | |||||||||||
Interest expense | 119,955 | 72,543 | 63,413 | ||||||||
Loss (income) from equity method investment | 3,985 | (3,658) | (4,546) | ||||||||
Gain from equity method investment | — | (135,387) | — | ||||||||
Goodwill impairment | 107,827 | — | — | ||||||||
Loss on extinguishment of debt | 3,726 | 40,206 | — | ||||||||
Gain on disposal of business | (68,443) | — | — | ||||||||
Total other expense (income) | 167,050 | (26,296) | 58,867 | ||||||||
Segment (loss) income before income taxes | $ | (175,350) | $ | 47,517 | $ | 34,172 |
For the Year Ended December 31, | |||||||||||
(dollars in thousands, unaudited) | 2022 | 2021 | 2020 | ||||||||
Revenue | |||||||||||
Interest and Fees Revenue | $ | 241,268 | $ | 199,735 | $ | 164,681 | |||||
Insurance Premiums and Commissions | 54,561 | 48,714 | 35,553 | ||||||||
Other Revenue | 7,921 | 8,590 | 8,638 | ||||||||
Total Revenue | 303,750 | 257,039 | $ 208,872 | ||||||||
Provision for Losses | 114,567 | 54,997 | 58,647 | ||||||||
Net Revenue | 189,183 | 202,042 | 150,225 | ||||||||
Operating expenses | |||||||||||
Salaries and Benefits | 55,340 | 52,118 | 45,473 | ||||||||
Occupancy | 22,228 | 22,482 | 21,457 | ||||||||
Advertising Expense | 3,686 | 4,267 | 3,850 | ||||||||
Direct Operations | 11,053 | 9,777 | 7,781 | ||||||||
Amortization and Depreciation | 4,305 | 4,505 | 4,506 | ||||||||
Other operating expenses | 16,343 | 10,364 | 11,691 | ||||||||
Total operating expenses | 112,955 | 103,513 | 94,758 | ||||||||
Other expense (income) | |||||||||||
Interest Expense | 25,065 | 9,798 | 9,296 | ||||||||
Other Expense/Income | 25,065 | 9,798 | 9,296 | ||||||||
Segment income before income taxes | $ | 51,163 | $ | 88,731 | $ | 46,171 |
(in thousands, except percentages, unaudited) | Q4 2022 | Q3 2022 | Q2 2022 | Q1 2022 | Q4 2021 | ||||||||||||||||||
Revolving LOC | |||||||||||||||||||||||
Total gross loans receivable | $ | 833,438 | $ | 690,270 | $ | 627,163 | $ | 541,776 | $ | 459,176 | |||||||||||||
Total lending revenue | $ | 31,255 | $ | 24,575 | $ | 20,846 | $ | 18,655 | $ | 13,704 | |||||||||||||
Total lending provision | $ | 17,125 | $ | 13,379 | $ | 5,963 | $ | 8,714 | $ | 12,511 | |||||||||||||
NCOs (1) | $ | 8,672 | $ | 6,114 | $ | 3,537 | $ | 2,727 | $ | 1,731 | |||||||||||||
NCO rate (annualized) (1)(2) | 4.4 | % | 3.6 | % | 2.4 | % | 2.0 | % | 2.0 | % | |||||||||||||
ALL rate (3) | 4.9 | % | 4.8 | % | 4.5 | % | 5.1 | % | 4.8 | % | |||||||||||||
31+ days past-due rate (3) | 2.9 | % | 3.6 | % | 2.8 | % | 1.8 | % | 1.5 | % | |||||||||||||
(1) NCOs presented above include $0.8 million for the three months ended December 31, 2021 of NCOs related to the purchase accounting fair value discount, which are excluded from provision. | |||||||||||||||||||||||
(2) We calculate NCO rate as total quarterly NCOs divided by Average gross loans receivable then we annualized the rate. The amount and timing of recoveries are impacted by our collection strategies, which are based on customer behavior and risk profile and include direct customer communications and the periodic sale of charged off loans. | |||||||||||||||||||||||
(3) We calculate ALL rate and past-due rate as the respective totals divided by gross loans receivable at each respective quarter end. |
For the Year Ended December 31, | ||||||||
(dollars in thousands, unaudited) | 2022 | 2021(1) | ||||||
Revenue | ||||||||
Interest and fees revenue | $ | 95,332 | $ | 32,289 | ||||
Insurance premiums and commissions | 2,335 | 421 | ||||||
Other revenue | 8,779 | 2,132 | ||||||
Total revenue | 106,446 | 34,842 | ||||||
Provision for losses | 45,180 | 24,638 | ||||||
Net revenue | 61,266 | 10,204 | ||||||
Operating expenses | ||||||||
Salaries and benefits | 25,365 | 14,483 | ||||||
Occupancy | 1,258 | 512 | ||||||
Advertising | 1,420 | 1,272 | ||||||
Direct operations | 14,768 | 14,380 | ||||||
Depreciation and amortization | 13,923 | 10,445 | ||||||
Other operating expense | 3,392 | 3,601 | ||||||
Total operating expenses | 60,126 | 44,693 | ||||||
Other expense | (7,605) | — | ||||||
Goodwill Impairment | 37,414 | — | ||||||
Loss on Extinguishment of Debt | 665 | — | ||||||
Interest expense | 40,641 | 14,993 | ||||||
Total other expense | 71,115 | 14,993 | ||||||
Segment loss before income taxes | $ | (69,975) | $ | (49,482) | ||||
(1) The totals reported for the year ended December 31, 2021 include results from the date of the Flexiti acquisition, March 10, 2021, through December 31, 2021. |
For the Year Ended December 31, | ||||||||||||||
2022 | 2021 | 2020 | ||||||||||||
Net (loss) income from continuing operations | $ | (185,484) | $ | 59,334 | $ | 74,448 | ||||||||
Adjustments: | ||||||||||||||
Restructuring costs (1) | 16,038 | 12,717 | 510 | |||||||||||
Legal and other costs (2) | 1,489 | 2,134 | 2,415 | |||||||||||
Loss (income) from equity method investment (3) | 3,985 | (3,658) | (4,546) | |||||||||||
Gain from equity method investment (4) | — | (135,387) | — | |||||||||||
Transaction costs (5) | 11,179 | 15,406 | 2,737 | |||||||||||
Acquisition-related adjustments (6) | (2,004) | 13,949 | — | |||||||||||
Change in fair value of contingent consideration (7) | (7,605) | 6,209 | — | |||||||||||
Loss on extinguishment of debt (8) | 4,391 | 42,262 | — | |||||||||||
Share-based compensation (9) | 13,956 | 13,976 | 12,910 | |||||||||||
Intangible asset amortization (10) | 12,753 | 6,282 | 2,951 | |||||||||||
Gain on sale of business (11) | (68,443) | — | — | |||||||||||
Goodwill impairment (12) | 145,241 | — | — | |||||||||||
Cumulative tax effect of adjustments (13) | 5,316 | 8,455 | (4,534) | |||||||||||
Canada GST adjustment (14) | — | — | 2,160 | |||||||||||
Income tax valuations (15) | — | — | (3,472) | |||||||||||
Impact of tax law changes (16) | — | — | (11,251) | |||||||||||
Adjusted net (loss) income | $ | (49,188) | $ | 41,679 | $ | 74,328 | ||||||||
Net (loss) income | $ | (185,484) | $ | 59,334 | $ | 74,448 | ||||||||
Diluted weighted average shares outstanding | 40,428 | 43,143 | 42,091 | |||||||||||
Adjusted diluted weighted average shares outstanding | 40,428 | 43,143 | 42,091 | |||||||||||
Diluted (loss) earnings per share | $ | (4.59) | $ | 1.38 | $ | 1.77 | ||||||||
Per share impact of adjustments to net income (loss) | 3.37 | (0.41) | — | |||||||||||
Adjusted diluted (loss) earnings per share | $ | (1.22) | $ | 0.97 | $ | 1.77 | ||||||||
Note: Footnotes follow Reconciliation of Net income table on the next page |
(1) | Restructuring costs primarily related to U.S. and Canada store closures and other cost saving initiatives. | ||||
(2) | Legal and other costs primarily related to settlement costs related to certain legal matters. | ||||
(3) | Share of Katapult's U.S. GAAP net income or loss, recognized on a one quarter lag. | ||||
(4) | Gain on investment in Katapult recorded as a result of the completion of its reverse merger with FinServ. | ||||
(5) | Transaction costs primarily related to the sale of the Legacy U.S. Direct Lending Business in July 2022, the acquisition of First Heritage in July 2022 and the acquisition of Heights Finance in December 2021. | ||||
(6) | During 2022, acquisition-related adjustments related to the Heights Finance and First Heritage acquisitions. During 2022 and 2021, acquisition-related adjustments related to the Flexiti acquisition. | ||||
(7) | Adjustments related to the fair value of the contingent consideration related to the acquisition of Flexiti. | ||||
(8) | On July 30, 2021, we entered into new 7.50% Senior Secured Notes due 2028, which were used on August 12, 2021 to extinguish the 8.25% Senior Secured Notes due 2025. During the three and nine months ended December 30, 2021, $40.2 million from the loss on the extinguishment of debt was due to the early redemption of the 8.25% Senior Secured Notes due 2025. An additional $2.1 million of interest was incurred for the year ended December 30, 2021, which represents interest on the 8.25% Senior Secured Notes due 2025 for the period between July 30, 2021 and August 12, 2021, the period during which the 8.25% Senior Secured Notes and 7.50% Senior Secured Notes were outstanding. During the year ended December 31, 2022,, $3.1 million of the loss on extinguishment of debt was due to the early extinguishment of the U.S. SPV on July 8, 2022 upon the completion of the divestiture of our Legacy U.S.Direct Lending business to Community Choice Financial, $0.6 million was due to the extinguishment of the Heights Finance SPV on July 15, 2022 and $0.7 million of the loss on extinguishment of debt was due to the Flexiti SPF loan settlement. | ||||
(9) | Estimated fair value of share-based awards was recognized as non-cash compensation expense on a straight-line basis over the vesting period. | ||||
(10) | Intangible asset amortization primarily included amortization of identifiable intangible assets established in connection with the acquisitions of Flexiti in March 2021, Heights Finance in December 2021 and First Heritage in July 2022. | ||||
(11) | Gain on the divestiture of its Legacy U.S. Direct Lending Business to Community Choice Financial in July 2022. | ||||
(12) | Goodwill impairment charge of $107.8 million recorded on the U.S. Direct Lending reporting unit and $37.4 million recorded on the Canada POS Lending reporting unit during the fourth quarter of 2022. | ||||
(13) | Cumulative tax effect of adjustments included in Reconciliation of Net (loss) income to Adjusted net (loss) income table is calculated using the estimated incremental tax rate by country. | ||||
(14) | We received a Notice of Adjustment from Canadian tax authority auditors in the second quarter 2020 related to the treatment of certain expenses in prior years for purposes of calculating the Goods and Services Tax ("GST") due. | ||||
(15) | During the year ended December 31, 2020, a Texas court ruling related to the apportionment of income to the state for an unrelated company resulted in a change in estimate regarding the realization of a tax benefit previously taken. Accordingly, we recorded a $1.1 million liability for our estimated exposure related to this position, which was settled in April 2021. Also in the year ended December 31, 2020, we released a $4.6 million valuation allowance related to Net Operating Losses ("NOLs") for certain entities in Canada. | ||||
(16) | On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") was enacted by the U.S. Federal government in response to the COVID-19 pandemic. The CARES Act, among other things, allows NOLs incurred in 2018, 2019 and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. For the year ended December 31, 2020, we recorded an income tax benefit of $11.3 million related to the carryback of NOL from tax years 2018 and 2019. | ||||
For the Year Ended December 31, | For the Year Ended December 31, | |||||||||||||||||||||||||||||||
2022 | 2021 | % Change | 2021 | 2020 | % Change | |||||||||||||||||||||||||||
Average Exchange Rates for the Canadian Dollar | 0.7689 | $ | 0.7979 | (3.6) | % | $ | 0.7979 | $ | 0.7462 | 6.9 | % | |||||||||||||||||||||
December 31, | December 31, | Change | |||||||||||||||
2022 | 2021 | $ | % | ||||||||||||||
Exchange Rate for the Canadian Dollar | 0.7365 | 0.7846 | (0.0481) | (6.1) | % | ||||||||||||
For the Year Ended December 31, | ||||||||||||||||||||
2022 | 2021 | $ Change | % Change | |||||||||||||||||
Canada Direct Lending – constant currency basis: | ||||||||||||||||||||
Revenues | $ | 315,655 | $ | 257,039 | $ | 58,616 | 22.8 | % | ||||||||||||
Net revenue | 196,179 | 202,042 | (5,863) | (2.9) | % | |||||||||||||||
Segment income before income taxes | 52,574 | 88,731 | (36,157) | (40.7) | % | |||||||||||||||
Canada POS Lending – constant currency basis(1): | ||||||||||||||||||||
Revenues | $ | 111,163 | 34,842 | $ | 76,321 | 219.0 | % | |||||||||||||
Net revenue | 63,788 | 10,204 | 53,584 | 525.1 | % | |||||||||||||||
Segment loss before income taxes | (74,135) | (49,482) | (24,653) | 49.8 | % | |||||||||||||||
(1) The totals reported for the year ended December 31, 2021 include results from the date of acquisition, March 10, 2021, through December 31, 2021. | ||||||||||||||||||||
December 31, | December 31, | Change | ||||||||||||||||||
2022 | 2021 | $ | % | |||||||||||||||||
Canada Direct Lending – constant currency basis: | ||||||||||||||||||||
Gross loans receivable | $ | 512,454 | $ | 427,197 | $ | 85,257 | 20.0 | % | ||||||||||||
Canada POS Lending – constant currency basis: | ||||||||||||||||||||
Gross loans receivable | $ | 887,911 | $ | 459,176 | $ | 428,735 | 93.4 | % | ||||||||||||
Capacity | Interest Rate | Maturity | Balance as of December 31, 2022 (in USD) | ||||||||||||||
7.50% Senior Secured Notes (due 2028) (2) | $1.0 billion | 7.50% | August 1, 2028 | $ | 982,934 | ||||||||||||
Heights SPV | $425.0 million | 1-Mo SOFR + 4.25% | July 15, 2025 | 393,181 | |||||||||||||
First Heritage SPV | $225.0 million | 1-Mo SOFR + 4.25% | July 13, 2025 | 178,622 | |||||||||||||
Flexiti SPV(1) | C$535.0 million | Weighted average interest rate (3)(5) 8.33% | September 29, 2025 | 339,651 | |||||||||||||
Flexiti Securitization(1) | C$526.5 million | 1-Mo CDOR + 3.59%)(5) | December 9, 2025 | 385,054 | |||||||||||||
Canada SPV(1) | C$400.0 million | 3-Mo CDOR + 6.00% | August 2, 2026 | 292,872 | |||||||||||||
Curo Canada Revolving Credit Facility(1)(4) | C$5.0 million | Canada Prime Rate + 1.95% | January 6, 2023 | — | |||||||||||||
Senior Revolver | $40.0 million | 1-Mo SOFR + 5.00% | August 31, 2023 | 35,000 | |||||||||||||
(1) Capacity amounts are denominated in Canadian dollars, while outstanding balances as of December 31, 2022 are denominated in U.S. dollars. | |||||||||||||||||
(2) On July 30, 2021, we closed our $750 million aggregate principal amount of new 7.50% Senior Secured Notes, which was used to redeem our $690.0 million 8.25% Senior Secured Notes due 2025. On December 27, 2021, we issued an additional $250.0 million of our 7.50% Senior Secured Notes for a total capacity of $1.0 billion. | |||||||||||||||||
(3) The weighted average interest rate does not include the impact of the amortization of deferred loan origination costs or debt discounts. | |||||||||||||||||
(4) On December 21, 2022 the maximum amount of the CURO Canada Revolving Credit Facility was reduced from C$10.0million to C$5.0 million, and the facility was cancelled in its entirety on January 6, 2023. | |||||||||||||||||
(5) Swapped to fixed rate via interest rate swap hedging arrangement that terminates on September 29, 2025 for Flexiti SPV and December 9, 2025 for Flexiti Securitization. |
For the Year Ended December 31, | ||||||||||||||||||||
2022 | 2021 | 2020 | ||||||||||||||||||
Net cash provided by continuing operating activities | $ | 284,607 | $ | 323,173 | $ | 403,505 | ||||||||||||||
Net cash used in investing activities | (777,949) | (923,488) | (255,056) | |||||||||||||||||
Net cash provided by financing activities | 501,062 | 491,291 | 7,329 | |||||||||||||||||
Index to Consolidated Financial Statements | Page | |||||||
Consolidated Balance Sheets - December 31, 2022 and 2021 | ||||||||
Consolidated Statements of Operations - Years Ended December 31, 2022, 2021 and 2020 | ||||||||
Consolidated Statements of Comprehensive (Loss) Income - Years Ended December 31, 2022, 2021 and 2020 | ||||||||
Consolidated Statements of Changes in Equity - Years Ended December 31, 2022, 2021 and 2020 | ||||||||
Consolidated Statements of Cash Flows - Years Ended December 31, 2022, 2021 and 2020 | ||||||||
December 31, 2022 | December 31, 2021 | ||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 73,932 | $ | 63,179 | |||||||
Restricted cash (includes restricted cash of consolidated VIEs of $52,277 and $57,155 as of December 31, 2022 and December 31, 2021, respectively) | 91,745 | 98,896 | |||||||||
Gross loans receivable (includes loans of consolidated VIEs of $1,964,275 and $1,294,706 as of December 31, 2022 and December 31, 2021, respectively) | 2,087,833 | 1,548,318 | |||||||||
Less: Allowance for loan losses (includes allowance for loan losses of consolidated VIEs of $108,451 and $66,618 as of December 31, 2022 and December 31, 2021, respectively) | (122,028) | (87,560) | |||||||||
Loans receivable, net | 1,965,805 | 1,460,758 | |||||||||
Income taxes receivable | 21,918 | 31,774 | |||||||||
Prepaid expenses and other (includes prepaid expenses and other of consolidated VIEs of $12,908 and $— as of December 31, 2022 and December 31, 2021, respectively) | 53,057 | 42,038 | |||||||||
Property and equipment, net | 31,957 | 54,635 | |||||||||
Investment in Katapult | 23,915 | 27,900 | |||||||||
Right of use asset - operating leases | 61,197 | 116,300 | |||||||||
Deferred tax assets | 49,893 | 15,639 | |||||||||
Goodwill | 276,269 | 429,792 | |||||||||
Intangibles, net | 123,677 | 109,930 | |||||||||
Other assets | 15,828 | 9,755 | |||||||||
Total Assets | $ | 2,789,193 | $ | 2,460,596 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Liabilities | |||||||||||
Accounts payable and accrued liabilities (includes accounts payable and accrued liabilities of consolidated VIEs of $13,571 and $9,886 as of December 31, 2022 and December 31, 2021, respectively) | $ | 73,827 | $ | 121,434 | |||||||
Deferred revenue | 32,259 | 21,649 | |||||||||
Lease liability - operating leases | 62,847 | 122,431 | |||||||||
Contingent consideration related to acquisition | 16,884 | 26,508 | |||||||||
Income taxes payable | — | 680 | |||||||||
Accrued interest (includes accrued interest of consolidated VIEs of $7,023 and $3,279 as of December 31, 2022 and December 31, 2021, respectively) | 38,460 | 34,974 | |||||||||
Liability for losses on CSO lender-owned consumer loans | — | 6,908 | |||||||||
Debt (includes debt and issuance costs of consolidated VIEs of $1,609,427 and $20,047 as of December 31, 2022 and $979,500 and $14,428 as of December 31, 2021, respectively) | 2,607,314 | 1,945,793 | |||||||||
Other long-term liabilities | 11,736 | 13,845 | |||||||||
Deferred tax liabilities | — | 6,044 | |||||||||
Total Liabilities | 2,843,327 | 2,300,266 | |||||||||
Commitments and contingencies (Note 7) | |||||||||||
Stockholders' Equity | |||||||||||
Preferred stock - $0.001 par value, 25,000,000 shares authorized; no shares were issued | — | — | |||||||||
Common stock - $0.001 par value; 225,000,000 shares authorized; 50,216,165 and 49,684,080 shares issued; and 40,518,052 and 40,810,444 shares outstanding at the respective period ends | 23 | 23 | |||||||||
Treasury stock, at cost - 9,698,113 and 8,873,636 shares at the respective period ends | (136,832) | (124,302) | |||||||||
Paid-in capital | 124,483 | 113,520 | |||||||||
Retained earnings | 4,268 | 203,467 | |||||||||
Accumulated other comprehensive loss | (46,076) | (32,378) | |||||||||
Total Stockholders' (Deficit) Equity | (54,134) | 160,330 | |||||||||
Total Liabilities and Stockholders' (Deficit) Equity | $ | 2,789,193 | $ | 2,460,596 |
For the Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Revenue | |||||||||||||||||
Interest and fees revenue | $ | 905,407 | $ | 743,735 | $ | 788,188 | |||||||||||
Insurance premiums and commissions | 88,490 | 49,411 | 35,553 | ||||||||||||||
Other revenue | 32,021 | 24,697 | 23,655 | ||||||||||||||
Total revenue | 1,025,918 | 817,843 | 847,396 | ||||||||||||||
Provision for losses | 400,325 | 245,668 | 288,811 | ||||||||||||||
Net revenue | 625,593 | 572,175 | 558,585 | ||||||||||||||
Operating Expenses | |||||||||||||||||
Salaries and benefits | 281,636 | 237,109 | 196,817 | ||||||||||||||
Occupancy | 59,485 | 55,559 | 57,271 | ||||||||||||||
Advertising | 32,143 | 38,762 | 44,552 | ||||||||||||||
Direct operations | 64,128 | 60,056 | 46,893 | ||||||||||||||
Depreciation and amortization | 36,322 | 26,955 | 17,498 | ||||||||||||||
Other operating expense | 82,811 | 68,473 | 47,048 | ||||||||||||||
Total operating expenses | 556,525 | 486,914 | 410,079 | ||||||||||||||
Other expense (income) | |||||||||||||||||
Interest expense | 185,661 | 97,334 | 72,709 | ||||||||||||||
Loss (income) from equity method investment | 3,985 | (3,658) | (4,546) | ||||||||||||||
Gain from equity method investment | — | (135,387) | — | ||||||||||||||
Goodwill impairment | 145,241 | — | — | ||||||||||||||
Loss on extinguishment of debt | 4,391 | 40,206 | — | ||||||||||||||
(Gain) loss on change in fair value of contingent consideration | (7,605) | 6,209 | — | ||||||||||||||
Gain on sale of business | (68,443) | — | — | ||||||||||||||
Total other expense (income) | 263,230 | 4,704 | 68,163 | ||||||||||||||
(Loss) income from continuing operations before income taxes | (194,162) | 80,557 | 80,343 | ||||||||||||||
(Benefit) provision for income taxes | (8,678) | 21,223 | 5,895 | ||||||||||||||
Net (loss) income from continuing operations | $ | (185,484) | $ | 59,334 | $ | 74,448 | |||||||||||
Income from discontinued operations, before income taxes | — | — | 1,714 | ||||||||||||||
Income tax expense related to disposition | — | — | 429 | ||||||||||||||
Net income from discontinued operations | — | — | 1,285 | ||||||||||||||
Net (loss) income | (185,484) | 59,334 | 75,733 | ||||||||||||||
Basic (loss) earnings per share: | |||||||||||||||||
Continuing operations | $ | (4.59) | $ | 1.44 | $ | 1.82 | |||||||||||
Discontinued operations | — | — | 0.03 | ||||||||||||||
Basic (loss) earnings per share | $ | (4.59) | $ | 1.44 | $ | 1.85 | |||||||||||
Diluted (loss) earnings per share: | |||||||||||||||||
Continuing operations | $ | (4.59) | $ | 1.38 | $ | 1.77 | |||||||||||
Discontinued operations | — | — | 0.03 | ||||||||||||||
Diluted (loss) earnings per share | $ | (4.59) | $ | 1.38 | $ | 1.80 | |||||||||||
Weighted average common shares outstanding: | |||||||||||||||||
Basic | 40,428 | 41,155 | 40,886 | ||||||||||||||
Diluted | 40,428 | 43,143 | 42,091 |
For the Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Net (loss) income | $ | (185,484) | $ | 59,334 | $ | 75,733 | |||||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||||
Change in derivative instruments designated as cash flow hedges, net of tax | 5,333 | — | — | ||||||||||||||
Foreign currency translation adjustment, net of tax | (19,031) | (2,246) | 8,531 | ||||||||||||||
Other comprehensive (loss) income, net of tax | (13,698) | (2,246) | 8,531 | ||||||||||||||
Comprehensive (loss) income | $ | (199,182) | $ | 57,088 | $ | 84,264 |
Common Stock | Treasury Stock, at cost | Paid-in capital | Retained Earnings (Deficit) | AOCI (1) | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||
Balances at December 31, 2019 | 41,156,224 | $ | 9 | $ | (72,343) | $ | 68,087 | $ | 93,423 | $ | (38,663) | $ | 50,513 | ||||||||||||||||||||||||||||
Net income | — | — | — | — | 75,733 | — | 75,733 | ||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment and other | — | — | — | — | — | 8,531 | 8,531 | ||||||||||||||||||||||||||||||||||
Dividends | — | — | — | — | (9,088) | — | (9,088) | ||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | 12,910 | — | — | 12,910 | ||||||||||||||||||||||||||||||||||
Proceeds from exercise of stock options | 274,510 | — | — | 765 | — | — | 765 | ||||||||||||||||||||||||||||||||||
Repurchase of common stock | (540,762) | — | (5,509) | — | — | — | (5,509) | ||||||||||||||||||||||||||||||||||
Net settlement of share-based awards | 480,532 | — | — | (1,950) | — | — | (1,950) | ||||||||||||||||||||||||||||||||||
Balances at December 31, 2020 | 41,370,504 | $ | 9 | $ | (77,852) | $ | 79,812 | $ | 160,068 | $ | (30,132) | $ | 131,905 | ||||||||||||||||||||||||||||
Net income | — | — | — | — | 59,334 | — | 59,334 | ||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment and other | — | — | — | — | — | (2,246) | (2,246) | ||||||||||||||||||||||||||||||||||
Dividends | — | — | — | — | (15,935) | — | (15,935) | ||||||||||||||||||||||||||||||||||
Common stock issued for acquisition of Heights Finance | 1,446,257 | 14 | — | 24,355 | — | — | 24,369 | ||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | 13,976 | — | — | 13,976 | ||||||||||||||||||||||||||||||||||
Proceeds from exercise of stock options | 66,972 | — | — | 272 | — | — | 272 | ||||||||||||||||||||||||||||||||||
Repurchase of common stock (2) | (2,718,333) | — | (46,450) | — | — | — | (46,450) | ||||||||||||||||||||||||||||||||||
Net settlement of share-based awards | 645,044 | — | — | (4,895) | — | — | (4,895) | ||||||||||||||||||||||||||||||||||
Balances at December 31, 2021 | 40,810,444 | $ | 23 | $ | (124,302) | $ | 113,520 | $ | 203,467 | $ | (32,378) | $ | 160,330 | ||||||||||||||||||||||||||||
Net loss | — | — | — | — | (185,484) | (185,484) | |||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of tax | — | — | — | — | — | (13,698) | (13,698) | ||||||||||||||||||||||||||||||||||
Dividends | — | — | — | — | (13,715) | — | (13,715) | ||||||||||||||||||||||||||||||||||
Share based compensation expense | — | — | — | 13,957 | — | — | 13,957 | ||||||||||||||||||||||||||||||||||
Repurchase of common stock | (824,477) | — | (12,530) | — | — | — | (12,530) | ||||||||||||||||||||||||||||||||||
Common stock issued for RSUs vesting, net of shares withheld and withholding paid for employee taxes | 532,085 | — | (2,994) | — | — | (2,994) | |||||||||||||||||||||||||||||||||||
Balances at December 31, 2022 | 40,518,052 | $ | 23 | $ | (136,832) | $ | 124,483 | $ | 4,268 | $ | (46,076) | $ | (54,134) | ||||||||||||||||||||||||||||
(1) Accumulated other comprehensive income (loss) | |||||||||||||||||||||||||||||||||||||||||
(2)Includes the repurchase of 500,000 shares of common stock from a related party for $18.10 per share. See Note 23, "Share Repurchase Program" for additional information. |
For the Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Cash flows from operating activities | |||||||||||||||||
Net (loss) income | $ | (185,484) | $ | 59,334 | $ | 74,448 | |||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||
Depreciation and amortization | 36,322 | 26,955 | 17,498 | ||||||||||||||
Provision for losses | 400,325 | 245,668 | 288,811 | ||||||||||||||
Amortization of debt issuance costs and bond discount | 11,315 | 6,871 | 3,935 | ||||||||||||||
Loss on extinguishment of debt | 4,391 | 40,206 | — | ||||||||||||||
Deferred income tax benefit | (38,254) | (18,297) | 11,691 | ||||||||||||||
Gain on disposal of Legacy U.S. Direct Lending business | (68,443) | — | — | ||||||||||||||
Loss on disposal of property and equipment | 4,420 | 7,054 | 150 | ||||||||||||||
Loss from equity method investment | 3,985 | (3,658) | (4,546) | ||||||||||||||
Impairment loss (gain) from equity method investment | — | (135,387) | — | ||||||||||||||
Change in fair value of contingent consideration | (7,605) | 6,209 | — | ||||||||||||||
Share-based compensation | 13,957 | 13,976 | 12,910 | ||||||||||||||
Goodwill impairment | 145,241 | — | — | ||||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||||
Accrued interest on loans receivable | (37,257) | 8,751 | 23,714 | ||||||||||||||
Prepaid expenses and other assets | 15,003 | (6,053) | 8,058 | ||||||||||||||
Accounts payable and accrued liabilities | (46,624) | 43,832 | (11,876) | ||||||||||||||
Deferred revenue | 17,765 | 16,581 | (4,769) | ||||||||||||||
Income taxes payable | (9,088) | 678 | — | ||||||||||||||
Income taxes receivable | 17,892 | 3,829 | (20,603) | ||||||||||||||
Accrued interest | 3,624 | 13,069 | 264 | ||||||||||||||
Other long-term liabilities | 3,122 | (6,445) | 3,820 | ||||||||||||||
Net cash provided by continuing operating activities | 284,607 | 323,173 | 403,505 | ||||||||||||||
Net cash provided by (used in) discontinued operating activities | — | — | 1,714 | ||||||||||||||
Net cash provided by operating activities | 284,607 | 323,173 | 405,219 | ||||||||||||||
Cash flows from investing activities | |||||||||||||||||
Purchase of property, equipment and software | (45,821) | (23,648) | (10,920) | ||||||||||||||
Loans receivable originated or acquired | (2,554,947) | (1,517,275) | (1,296,398) | ||||||||||||||
Loans receivable repaid | 1,664,851 | 928,302 | 1,079,437 | ||||||||||||||
Proceeds from Katapult | 136,879 | (12,757) | |||||||||||||||
Acquisition of Ad Astra, net of acquiree's cash received | — | — | (14,418) | ||||||||||||||
Acquisition of Flexiti, net of acquiree's cash received | (91,203) | — | |||||||||||||||
Acquisition of Heights Finance, net of acquiree's cash received | — | (356,543) | — | ||||||||||||||
Divestiture of Legacy U.S. Direct Lending Business, net of cash provided | 288,980 | — | — | ||||||||||||||
Acquisition of First Heritage, net of acquiree's cash received | (131,012) | — | — | ||||||||||||||
Net cash used in investing activities | (777,949) | (923,488) | (255,056) | ||||||||||||||
Cash flows from financing activities | |||||||||||||||||
Proceeds from SPV and SPE facilities | 1,724,600 | 549,511 | 73,037 | ||||||||||||||
Payments on SPV and SPE facilities | (1,175,047) | (244,577) | (42,535) | ||||||||||||||
Debt issuance costs paid | (19,252) | (26,387) | (6,992) | ||||||||||||||
Proceeds from credit facilities | 169,496 | 68,108 | 69,947 | ||||||||||||||
Payments on credit facilities | (169,496) | (68,108) | (69,947) | ||||||||||||||
Extinguishment of 8.25% Senior Secured Notes | — | (690,000) | — | ||||||||||||||
Proceeds from issuance of 7.50% Senior Secured Notes | — | 1,000,000 | — | ||||||||||||||
Payments of call premiums from early debt extinguishments | — | (31,250) | — | ||||||||||||||
Proceeds from exercise of stock options | — | 272 | 765 | ||||||||||||||
Payments to net share settle equity awards | (2,994) | (4,895) | (1,950) | ||||||||||||||
Repurchase of common stock | (12,530) | (45,448) | (5,908) | ||||||||||||||
Dividends paid to stockholders | (13,715) | (15,935) | (9,088) | ||||||||||||||
Net cash provided by financing activities | 501,062 | 491,291 | 7,329 | ||||||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (4,118) | 2,991 | 595 | ||||||||||||||
Net increase in cash, cash equivalents and restricted cash | 3,602 | (106,033) | 158,087 | ||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | 162,075 | 268,108 | 110,021 | ||||||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 165,677 | $ | 162,075 | $ | 268,108 |
December 31, | ||||||||||||||||||||
2022 | 2021 | 2020 | ||||||||||||||||||
Cash and cash equivalents | $ | 73,932 | $ | 63,179 | $ | 213,343 | ||||||||||||||
Restricted cash (includes restricted cash of consolidated VIEs of $52,277 and $57,155 as of December 31, 2022 and December 31, 2021, respectively) | 91,745 | 98,896 | 54,765 | |||||||||||||||||
Total cash, cash equivalents and restricted cash used in the Statement of Cash Flows | $ | 165,677 | $ | 162,075 | $ | 268,108 |
Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Cash paid for: | |||||||||||||||||
Interest | $ | 162,365 | $ | 81,536 | $ | 69,212 | |||||||||||
Income taxes, net of refunds | 15,646 | 34,878 | 15,841 | ||||||||||||||
Non-cash investing activities: | |||||||||||||||||
Property and equipment accrued in accounts payable | 444 | 883 | 861 |
For the Year Ended December 31, | ||||||||||||||||||||
2022 | 2021 | 2020 | ||||||||||||||||||
Revolving LOC | $ | 345,813 | $ | 294,591 | $ | 249,502 | ||||||||||||||
Installment | 559,594 | 449,144 | 538,685 | |||||||||||||||||
Total interest and fees revenue | 905,407 | 743,735 | 788,187 | |||||||||||||||||
Insurance premiums and commissions | 88,490 | 49,410 | 35,553 | |||||||||||||||||
Other revenue | 32,021 | 24,698 | 23,655 | |||||||||||||||||
Total revenue(1) | $ | 1,025,918 | $ | 817,843 | $ | 847,396 | ||||||||||||||
(1) Includes revenue from CSO programs of $101.2 million, $167.1 million and $185.5 million for the years ended December 31, 2022, 2021 and 2020, respectively. |
December 31, 2021 | |||||
Total Installment - Guaranteed by the Company | |||||
Current loans receivable Guaranteed by the Company | $ | 38,102 | |||
1-30 days past-due | 6,795 | ||||
Delinquent loans receivable Guaranteed by the Company | 1,420 | ||||
Total loans receivable Guaranteed by the Company | 46,317 | ||||
Less: Liability for losses on CSO lender-owned consumer loans | (6,908) | ||||
Loans receivable Guaranteed by the Company, net | $ | 39,409 |
December 31, 2021 | ||||||||
Total Installment - Guaranteed by the Company | ||||||||
Delinquent loans receivable | ||||||||
31-60 days past-due | $ | 1,031 | ||||||
61-90 days past-due | 285 | |||||||
91 + days past-due | 104 | |||||||
Total delinquent loans receivable | $ | 1,420 |
For the Year Ended December 31, 2021 | ||||||||||||||
Revolving LOC | Installment | Other | Total | |||||||||||
Allowance for loan losses: | ||||||||||||||
Balance, beginning of period | $ | 51,958 | $ | 34,204 | $ | — | $ | 86,162 | ||||||
Charge-offs | (114,827) | (191,734) | (3,911) | (310,472) | ||||||||||
Recoveries | 29,454 | 107,147 | 1,810 | 138,411 | ||||||||||
Net charge-offs | (85,373) | (84,587) | (2,101) | (172,061) | ||||||||||
Provision for losses | 102,457 | 69,766 | 2,101 | 174,324 | ||||||||||
Effect of foreign currency translation | (902) | 37 | — | (865) | ||||||||||
Balance, end of period | $ | 68,140 | $ | 19,420 | $ | — | $ | 87,560 | ||||||
Liability for losses on CSO lender-owned consumer loans: | ||||||||||||||
Balance, beginning of period | $ | — | $ | 7,228 | $ | — | $ | 7,228 | ||||||
Decrease in liability | — | $ | (320) | — | $ | (320) | ||||||||
Balance, end of period | $ | — | $ | 6,908 | $ | — | $ | 6,908 |
As of December 31, 2022 | As of December 31, 2021 | ||||||||||
Current TDR gross receivables | $ | 10,169 | $ | 11,580 | |||||||
Delinquent TDR gross receivables | 2,635 | 5,066 | |||||||||
Total TDR gross receivables | 12,804 | 16,646 | |||||||||
Less: Impairment included in the allowance for loan losses | (2,691) | (3,632) | |||||||||
Less: Additional allowance | (660) | (2,212) | |||||||||
Outstanding TDR receivables, net of impairment | $ | 9,453 | $ | 10,802 |
For the Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Pre-modification TDR loans receivable | $ | 9,030 | $ | 16,255 | $ | 38,930 | |||||||||||
Post-modification TDR loans receivable | 8,702 | 14,538 | 34,252 | ||||||||||||||
Total concessions included in gross charge-offs | $ | 328 | $ | 1,717 | $ | 4,678 |
For the Year Ended December 31, | ||||||||||||||||||||
2022 | 2021 | 2020 | ||||||||||||||||||
Average outstanding TDR loans receivable | $ | 11,065 | $ | 18,259 | $ | 20,631 | ||||||||||||||
Interest income recognized | 5,320 | 18,328 | 17,074 | |||||||||||||||||
Number of TDR loans | 3,531 | 11,693 | 27,082 |
December 31, 2022 | December 31, 2021 | |||||||||||||
Assets | ||||||||||||||
Restricted cash | $ | 52,277 | $ | 57,155 | ||||||||||
Loans receivable, net | 1,855,824 | 1,228,088 | ||||||||||||
Prepaid expenses and other | 12,908 | — | ||||||||||||
Deferred tax assets | 17,027 | — | ||||||||||||
Total Assets | $ | 1,938,036 | $ | 1,285,243 | ||||||||||
Liabilities | ||||||||||||||
Accounts payable and accrued liabilities | $ | 13,571 | $ | 9,886 | ||||||||||
Deferred revenue | 31 | 106 | ||||||||||||
Deferred tax liability | — | 269 | ||||||||||||
Accrued interest | 7,023 | 3,279 | ||||||||||||
Income taxes payable | 7,850 | — | ||||||||||||
Debt, net | 1,589,380 | 965,072 | ||||||||||||
Total Liabilities | $ | 1,617,855 | $ | 978,612 |
U.S. Direct Lending | Canada Direct Lending | Canada POS Lending | Total | ||||||||||||||||||||
Goodwill at December 31, 2020 | $ | 105,922 | $ | 30,169 | $ | — | $ | 136,091 | |||||||||||||||
Foreign currency translation | — | (64) | (515) | (579) | |||||||||||||||||||
Measurement period adjustment | — | — | (4,478) | (4,478) | |||||||||||||||||||
Acquisition (Note 14) | 253,857 | — | 44,901 | 298,758 | |||||||||||||||||||
Goodwill at December 31, 2021 | 359,779 | 30,105 | 39,908 | 429,792 | |||||||||||||||||||
Foreign currency translation | — | (1,847) | (2,494) | (4,341) | |||||||||||||||||||
Measurement period adjustment | 11,825 | — | — | 11,825 | |||||||||||||||||||
Divestiture (Note 14) | (91,131) | — | — | (91,131) | |||||||||||||||||||
Acquisition (Note 14) | 75,365 | — | — | 75,365 | |||||||||||||||||||
Goodwill Impairment Charge | (107,827) | — | (37,414) | (145,241) | |||||||||||||||||||
Goodwill at December 31, 2022 | $ | 248,011 | $ | 28,258 | $ | — | $ | 276,269 |
December 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||
Weighted-Average Remaining Life (Years) | Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | |||||||||||||||||||||||||||||||||||
Assets not subject to amortization | |||||||||||||||||||||||||||||||||||||||||
Trade name | — | $ | 21,432 | $ | — | $ | 21,432 | $ | 22,832 | $ | — | $ | 22,832 | ||||||||||||||||||||||||||||
Assets subject to amortization | |||||||||||||||||||||||||||||||||||||||||
Merchant relationships | 3.3 | 18,265 | (6,610) | 11,655 | 19,459 | (3,151) | 16,308 | ||||||||||||||||||||||||||||||||||
Customer relationships | 2.4 | 18,005 | (5,957) | 12,048 | 20,285 | (10,295) | 9,990 | ||||||||||||||||||||||||||||||||||
Computer software(1) | 5.4 | 101,899 | (30,833) | 71,066 | 81,844 | (25,453) | 56,391 | ||||||||||||||||||||||||||||||||||
Trade name | 11.6 | 8,411 | (935) | 7,476 | 4,621 | (212) | 4,409 | ||||||||||||||||||||||||||||||||||
Balance, end of year | $ | 168,012 | $ | (44,335) | $ | 123,677 | $ | 149,041 | $ | (39,111) | $ | 109,930 | |||||||||||||||||||||||||||||
(1) Includes internally developed software, of $60.6 million and $44.7 million, net, as of December 31, 2022 and 2021, respectively. | |||||||||||||||||||||||||||||||||||||||||
Year Ending December 31, | |||||
2023 | $ | 23,817 | |||
2024 | 21,859 | ||||
2025 | 16,947 | ||||
2026 | 6,158 | ||||
2027 | 4,252 | ||||
Estimated Fair Value | |||||||||||||||||
Carrying Value December 31, 2022 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Financial assets: | |||||||||||||||||
Cash Surrender Value of Life Insurance | $ | 7,591 | $ | 7,591 | $ | — | $ | — | $ | 7,591 | |||||||
Derivative assets | 7,458 | — | 7,458 | — | 7,458 | ||||||||||||
Financial liabilities: | |||||||||||||||||
Non-qualified deferred compensation plan | $ | 5,149 | $ | 5,149 | $ | — | $ | — | 5,149 | ||||||||
Contingent consideration related to acquisition | 16,884 | — | — | 16,884 | 16,884 |
Estimated Fair Value | |||||||||||||||||
Carrying Value December 31, 2021 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Financial assets: | |||||||||||||||||
Cash Surrender Value of Life Insurance | $ | 8,242 | $ | 8,242 | $ | — | $ | — | $ | 8,242 | |||||||
Financial liabilities: | |||||||||||||||||
Non-qualified deferred compensation plan | $ | 5,109 | $ | 5,109 | $ | — | $ | — | $ | 5,109 | |||||||
Contingent consideration related to acquisition | 26,508 | — | — | 26,508 | 26,508 |
Estimated Fair Value | ||||||||||||||||||||
Carrying Value December 31, 2022 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 73,932 | $ | 73,932 | $ | — | $ | — | $ | 73,932 | ||||||||||
Restricted cash | 91,745 | 91,745 | — | — | 91,745 | |||||||||||||||
Loans receivable, net | 1,965,805 | — | — | 1,965,805 | 1,965,805 | |||||||||||||||
Investment in Katapult | 23,915 | 20,624 | — | — | 20,624 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
7.50% Senior Secured Notes | $ | 982,934 | $ | — | $ | 466,500 | $ | — | $ | 466,500 | ||||||||||
Heights SPV | 393,181 | — | — | 393,181 | 393,181 | |||||||||||||||
First Heritage SPV | 178,622 | — | — | 182,751 | 182,751 | |||||||||||||||
Flexiti SPV | 339,651 | — | — | 343,565 | 343,565 | |||||||||||||||
Flexiti Securitization | 385,054 | — | — | 387,759 | 387,759 | |||||||||||||||
Canada SPV | 292,872 | — | — | 294,594 | 294,594 | |||||||||||||||
Estimated Fair Value | |||||||||||||||||
Carrying Value December 31, 2021 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Financial assets: | |||||||||||||||||
Cash and cash equivalents | $ | 63,179 | $ | 63,179 | $ | — | $ | — | $ | 63,179 | |||||||
Restricted cash | 98,896 | 98,896 | — | — | 98,896 | ||||||||||||
Loans receivable, net | 1,460,758 | — | — | 1,460,758 | 1,460,758 | ||||||||||||
Investment in Katapult | 27,900 | 72,627 | — | — | 72,627 | ||||||||||||
Financial liabilities: | |||||||||||||||||
Liability for losses on CSO lender-owned consumer loans (1) | $ | 6,908 | $ | — | $ | — | $ | 6,908 | $ | 6,908 | |||||||
7.50% Senior Secured Notes | 980,721 | — | 1,005,700 | — | 1,005,700 | ||||||||||||
U.S. SPV (1) | 45,392 | — | — | 49,456 | 49,456 | ||||||||||||
Canada SPV | 157,813 | — | — | 160,533 | 160,533 | ||||||||||||
Flexiti SPV | 172,739 | — | — | 176,625 | 176,625 | ||||||||||||
Flexiti Securitization | 239,128 | — | — | 242,886 | 242,886 | ||||||||||||
Heights Finance SPV | 350,000 | — | — | 350,000 | 350,000 | ||||||||||||
(1) Liabilities were disposed of when we completed the divestiture of the Legacy U.S. Direct Lending Business on July 8, 2022. |
Equity Method Investment | Measurement Alternative (1) | Total Investment in Katapult | ||||||||||||||||||
Balance at December 31, 2019 | $ | 10,068 | $ | — | $ | 10,068 | ||||||||||||||
Equity method income | 4,546 | — | 4,546 | |||||||||||||||||
Accounting policy change for certain securities from equity method investment to measurement alternative | (12,452) | 12,452 | — | |||||||||||||||||
Purchases of common stock warrants and preferred shares | 4,030 | 7,157 | 11,187 | |||||||||||||||||
Purchases of common stock | 1,570 | — | 1,570 | |||||||||||||||||
Balance at December 31, 2020 | 7,762 | 19,609 | 27,371 | |||||||||||||||||
Equity method income | 3,658 | — | 3,658 | |||||||||||||||||
Conversion of investment(2) | 6,481 | (19,609) | (13,128) | |||||||||||||||||
Purchases of common stock | 9,999 | — | 9,999 | |||||||||||||||||
Balance at December 31, 2021 | 27,900 | — | 27,900 | |||||||||||||||||
Equity method loss | (3,985) | — | (3,985) | |||||||||||||||||
Balance at December 31, 2022 | $ | 23,915 | $ | — | $ | 23,915 | ||||||||||||||
(1) The Company elected to measure this equity security without a readily determinable fair value equal to its cost minus impairment. If the Company identifies an observable price change in orderly transactions for same or similar investment in Katapult, it will measure the equity security at fair value as of the date that the observable transaction occurred. | ||||||||||||||||||||
(2) On June 9, 2021, Katapult completed its merger with FinServ. Immediately prior to the merger, the Company first converted all of its preferred stock and exercised all common stock warrants, and then exchanged all shares of Katapult common stock for $146.9 million in cash and 18.9 million shares of common stock in the resulting public company, Katapult (NASDAQ: KPLT). The Company's entire investment in Katapult is now accounted for under the equity method of accounting. The Company recorded a related net gain of $135.4 million on its equity method investment in Katapult, based on the pro rata cost basis of the investment and the discharge of the guarantee provided during the second quarter of 2021. |
Amount | |||||
2023 | $ | 35,000 | |||
2024 | — | ||||
2025 | 1,314,833 | ||||
2026 | 294,594 | ||||
2027 | — | ||||
Thereafter | 1,000,000 | ||||
Debt (before deferred financing costs and discounts) | 2,644,427 | ||||
Less: deferred financing costs and discounts | 37,113 | ||||
Debt, net | $ | 2,607,314 |
Year Ended December 31, | |||||||||||
2022 | 2021 | 2020 | |||||||||
(Loss) income before taxes | |||||||||||
U.S. | $ | (140,463) | $ | 86,106 | $ | 59,741 | |||||
Non-U.S. | (53,697) | (5,549) | 20,602 | ||||||||
(Loss) income from continuing operations before taxes | $ | (194,160) | $ | 80,557 | $ | 80,343 | |||||
Current provision (benefit) | |||||||||||
Federal | $ | 16,254 | $ | 21,549 | $ | (14,585) | |||||
State | 3,783 | 4,553 | 5,959 | ||||||||
Foreign | 9,120 | 13,639 | 3,925 | ||||||||
Current provision (benefit) | $ | 29,157 | $ | 39,741 | $ | (4,701) | |||||
Deferred tax (benefit) provision | |||||||||||
Federal | $ | (19,691) | $ | (5,022) | $ | 14,949 | |||||
State | (1,873) | 154 | (1,247) | ||||||||
Foreign | (16,271) | (13,650) | (3,106) | ||||||||
Deferred tax (benefit) provision | $ | (37,835) | $ | (18,518) | $ | 10,596 | |||||
(Benefit) provision for income taxes | $ | (8,678) | $ | 21,223 | $ | 5,895 |
Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Income tax (benefit) expense using the statutory federal rate in effect | $ | (40,774) | $ | 16,917 | $ | 16,872 | |||||||||||
Tax effect of: | |||||||||||||||||
Effects of foreign rates different than U.S. statutory rate | 3,222 | 518 | (1,236) | ||||||||||||||
State, local and provincial income taxes, net of federal benefit | (2,635) | 3,359 | 6,619 | ||||||||||||||
Tax credits | (678) | (802) | (3,188) | ||||||||||||||
Nondeductible expenses | 1,801 | 1,090 | 564 | ||||||||||||||
Valuation allowance | 1,349 | (275) | (2,686) | ||||||||||||||
Prior year income tax re-determination | (602) | — | — | ||||||||||||||
Share-based compensation | 132 | (705) | 1,119 | ||||||||||||||
Gain on sale of business | 8,484 | — | — | ||||||||||||||
Impairment of Goodwill | 22,369 | — | — | ||||||||||||||
Federal NOL carryback | — | — | (11,251) | ||||||||||||||
Prior year basis adjustment | — | — | (659) | ||||||||||||||
Change in fair value of contingent consideration | (1,187) | 944 | — | ||||||||||||||
Other | (159) | 177 | (259) | ||||||||||||||
Total (benefit) provision for income taxes | $ | (8,678) | $ | 21,223 | $ | 5,895 | |||||||||||
Effective income tax rate | 4.5 | % | 26.3 | % | 7.3 | % | |||||||||||
Statutory federal income tax rate | 21.0 | % | 21.0 | % | 21.0 | % |
Year Ended December 31, | |||||||||||
2022 | 2021 | ||||||||||
Balance at the beginning of year | $ | 250 | $ | 1,100 | |||||||
Additions for tax positions related to prior years | 1,648 | 125 | |||||||||
Additions for tax positions related to the current year | 60 | 125 | |||||||||
Settlements with taxing authorities | — | (1,100) | |||||||||
Balance at end of year | $ | 1,958 | $ | 250 |
Year Ended December 31, | ||||||||
2022 | 2021 | |||||||
Deferred tax assets related to: | ||||||||
Loans receivable | $ | 9,913 | $ | — | ||||
Accrued expenses and other reserves | 7,309 | 2,960 | ||||||
Lease liability | 16,055 | 26,777 | ||||||
Compensation accruals | 6,826 | 5,845 | ||||||
Deferred revenue | 1,811 | 204 | ||||||
State and provincial NOL carryforwards | 18,560 | 15,547 | ||||||
Foreign NOL and capital loss carryforwards | 21,378 | 17,090 | ||||||
Tax credit carryforwards | 3,872 | 3,905 | ||||||
Gross deferred tax assets | 85,724 | 72,328 | ||||||
Less: Valuation allowance | (9,719) | (7,732) | ||||||
Net deferred tax assets | $ | 76,005 | $ | 64,596 | ||||
Deferred tax liabilities related to: | ||||||||
Property and equipment | $ | (2,820) | $ | (14,950) | ||||
Right of use asset | (15,648) | (25,304) | ||||||
Goodwill and other intangible assets | (2,730) | (9,914) | ||||||
Prepaid expenses and other assets | (3,055) | (466) | ||||||
Hedge accounting | (1,859) | — | ||||||
Loans receivable | — | (4,367) | ||||||
Gross deferred tax liabilities | (26,112) | (55,001) | ||||||
Net deferred tax assets | $ | 49,893 | $ | 9,595 |
Year Ended December 31, | ||||||||
2022 | 2021 | |||||||
Deferred tax assets | $ | 49,893 | $ | 15,639 | ||||
Deferred tax liabilities | — | (6,044) | ||||||
Net deferred tax assets | $ | 49,893 | $ | 9,595 |
Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Balance at the beginning of year | $ | 7,732 | $ | 5,695 | $ | 8,328 | |||||||||||
Increase (decrease) to balance charged as expense | 1,349 | (275) | (2,686) | ||||||||||||||
Increase to balance charged to opening balance sheet of the acquisition | 1,044 | 1,873 | — | ||||||||||||||
(Decrease) to balance for the divestiture | (542) | — | — | ||||||||||||||
Increase (decrease) to balance charged to Other comprehensive income | 136 | 392 | (378) | ||||||||||||||
Effect of foreign currency translation | — | 47 | 431 | ||||||||||||||
Balance at end of year | $ | 9,719 | $ | 7,732 | $ | 5,695 |
For the Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Net (loss) income from continuing operations | $ | (185,484) | $ | 59,334 | $ | 74,448 | |||||||||||
Net income from discontinued operations, net of tax | — | — | 1,285 | ||||||||||||||
Net income | $ | (185,484) | $ | 59,334 | $ | 75,733 | |||||||||||
Weighted average common shares - basic | 40,428 | 41,155 | 40,886 | ||||||||||||||
Dilutive effect of stock options and restricted stock units | — | 1,988 | 1,205 | ||||||||||||||
Weighted average common shares - diluted | 40,428 | 43,143 | 42,091 | ||||||||||||||
(Loss) earnings per share: | |||||||||||||||||
Continuing operations | $ | (4.59) | $ | 1.44 | $ | 1.82 | |||||||||||
Discontinued operations | — | — | 0.03 | ||||||||||||||
Basic (loss) earnings per share | $ | (4.59) | $ | 1.44 | $ | 1.85 | |||||||||||
Diluted (loss) earnings per share: | |||||||||||||||||
Continuing Operations | $ | (4.59) | $ | 1.38 | $ | 1.77 | |||||||||||
Discontinued operations | — | — | 0.03 | ||||||||||||||
Diluted (loss) earnings per share | $ | (4.59) | $ | 1.38 | $ | 1.80 | |||||||||||
Stock Options | Weighted Average Exercise Price | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (years) | Aggregate Intrinsic Value (in millions) | |||||||||||||||||||||||||
Outstanding at Outstanding at January 1, 2020 | 1,404,622 | $ | 3.56 | 2.6 | $ | 12.1 | |||||||||||||||||||||||
Granted | — | $ | — | $ | — | ||||||||||||||||||||||||
Exercised | (274,510) | $ | 2.79 | $ | 3.2 | ||||||||||||||||||||||||
Forfeited | — | $ | — | $ | — | ||||||||||||||||||||||||
Outstanding at December 31, 2020 | 1,130,112 | $ | 3.74 | 2.6 | $ | 12.0 | |||||||||||||||||||||||
Granted | — | $ | — | $ | — | ||||||||||||||||||||||||
Exercised | (615,024) | $ | 2.83 | $ | 8.1 | ||||||||||||||||||||||||
Forfeited | — | $ | — | $ | — | ||||||||||||||||||||||||
Outstanding at December 31, 2021 | 515,088 | $ | 4.83 | 4.2 | $ | 5.8 | |||||||||||||||||||||||
Granted | — | $ | — | $ | — | ||||||||||||||||||||||||
Exercised | — | $ | — | $ | — | ||||||||||||||||||||||||
Forfeited | — | $ | — | $ | — | ||||||||||||||||||||||||
Outstanding at December 31, 2022 | 515,088 | $ | 4.83 | 3.2 | $ | (0.7) | |||||||||||||||||||||||
Options exercisable at December 31, 2022 | 515,088 | $ | 4.83 | 3.2 | $ | (0.7) |
Number of RSUs | Weighted Average Grant Date Fair Value per Share | ||||||||||||||||
Time-Based | Market-Based | Performance-Based | |||||||||||||||
January 1, 2020 | 1,061,753 | 394,861 | — | $ | 11.47 | ||||||||||||
Granted | 694,213 | 368,539 | — | $ | 10.40 | ||||||||||||
Vested | (716,268) | — | — | $ | 12.86 | ||||||||||||
Forfeited | (26,906) | (4,687) | — | $ | 11.89 | ||||||||||||
December 31, 2020 | 1,012,792 | 758,713 | — | $ | 10.26 | ||||||||||||
Granted | 1,238,564 | 299,053 | 253,310 | $ | 15.51 | ||||||||||||
Vested | (494,790) | — | — | $ | 11.04 | ||||||||||||
Forfeited | (80,638) | (51,032) | — | $ | 11.46 | ||||||||||||
December 31, 2021 | 1,675,928 | 1,006,734 | 253,310 | $ | 13.27 | ||||||||||||
Granted | 1,649,980 | 1,422,886 | — | $ | 9.75 | ||||||||||||
Vested | (785,751) | — | (7,568) | $ | 13.80 | ||||||||||||
Forfeited | (444,088) | (701,258) | (101,252) | $ | 11.90 | ||||||||||||
December 31, 2022 | 2,096,069 | 1,728,362 | 144,490 | $ | 10.87 |
For the year ended, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Pre-tax share-based compensation expense | $ | 13,957 | $ | 13,976 | $ | 12,910 | |||||||||||
Income tax benefit | (3,283) | (4,475) | (1,164) | ||||||||||||||
Total share-based compensation expense, net of tax | $ | 10,674 | $ | 9,501 | $ | 11,746 |
Year Ended December 31, | ||||||||||||||||||||
2022 | 2021 | 2020 | ||||||||||||||||||
Operating lease costs: | ||||||||||||||||||||
Third-Party | $ | 32,538 | $ | 31,197 | $ | 30,828 | ||||||||||||||
Related-Party | 2,282 | 3,394 | 3,386 | |||||||||||||||||
Total operating lease costs (1) | $ | 34,820 | $ | 34,591 | $ | 34,214 | ||||||||||||||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 28,414 | $ | 36,235 | $ | 34,651 | ||||||||||||||
ROU assets (divested) obtained | $ | (24,749) | $ | 9,682 | $ | 18,847 | ||||||||||||||
Weighted average remaining lease term - Operating leases | 4.4 years | 4.9 years | 5.7 years | |||||||||||||||||
Weighted average discount rate - Operating leases | 7.8 | % | 8.3 | % | 9.9 | % | ||||||||||||||
(1) Includes immaterial variable lease costs. |
Third-Party | Related-Party | Total | ||||||||||||||||||
2023 | $ | 24,323 | $ | 616 | $ | 24,939 | ||||||||||||||
2024 | 17,433 | 632 | 18,065 | |||||||||||||||||
2025 | 11,813 | 649 | 12,462 | |||||||||||||||||
2026 | 6,686 | 667 | 7,353 | |||||||||||||||||
2027 | 4,265 | 685 | 4,950 | |||||||||||||||||
Thereafter | 8,139 | 993 | 9,132 | |||||||||||||||||
Total | 72,659 | 4,242 | 76,901 | |||||||||||||||||
Less: Imputed interest | (12,878) | (1,176) | (14,054) | |||||||||||||||||
Operating lease liabilities | $ | 59,781 | $ | 3,066 | $ | 62,847 |
Dividends Paid | |||||||||||||||||
Date of declaration | Stockholders of record | Date paid | Dividend per share | (in thousands) | |||||||||||||
Q1 2022 | February 4, 2022 | February 18, 2022 | March 1, 2022 | $ | 0.11 | $ | 4,517 | ||||||||||
Q2 2022 | April 28, 2022 | May 10, 2022 | May 23, 2022 | $ | 0.11 | $ | 4,440 | ||||||||||
Q3 2022 | August 3, 2022 | August 15, 2022 | August 26, 2022 | $ | 0.11 | $ | 4,453 | ||||||||||
Dividends Paid | |||||||||||||||||
Date of declaration | Stockholders of record | Date paid | Dividend per share | (in thousands) | |||||||||||||
Q1 2021 | January 29, 2021 | February 16, 2021 | March 2, 2021 | $ | 0.055 | $ | 2,284 | ||||||||||
Q2 2021 | May 3, 2021 | May 14, 2021 | May 27, 2021 | $ | 0.11 | $ | 4,580 | ||||||||||
Q3 2021 | July 28, 2021 | August 9, 2021 | August 19, 2021 | $ | 0.11 | $ | 4,556 | ||||||||||
Q4 2021 | October 27, 2021 | November 12, 2021 | November 22, 2021 | $ | 0.11 | $ | 4,453 | ||||||||||
For the Year Ended December 31, | |||||||||||||||||
2022 | 2021 | 2020 | |||||||||||||||
Revenues by segment: (1) | |||||||||||||||||
U.S. Direct Lending | $ | 615,722 | $ | 525,962 | $ | 638,524 | |||||||||||
Canada Direct Lending | 303,750 | 257,039 | 208,872 | ||||||||||||||
Canada POS Lending | 106,446 | 34,842 | — | ||||||||||||||
Consolidated revenue | $ | 1,025,918 | $ | 817,843 | $ | 847,396 | |||||||||||
Net revenues by segment: | |||||||||||||||||
U.S. Direct Lending | $ | 375,144 | $ | 359,929 | $ | 408,360 | |||||||||||
Canada Direct Lending | 189,183 | 202,042 | 150,225 | ||||||||||||||
Canada POS Lending | 61,266 | 10,204 | — | ||||||||||||||
Consolidated net revenue | $ | 625,593 | $ | 572,175 | $ | 558,585 | |||||||||||
Segment (loss) income before income taxes: | |||||||||||||||||
U.S. Direct Lending | $ | (175,350) | $ | 47,517 | $ | 34,172 | |||||||||||
Canada Direct Lending | 51,163 | 88,731 | 46,171 | ||||||||||||||
Canada POS Lending | (69,975) | (55,691) | — | ||||||||||||||
Consolidated (loss) income before income taxes | $ | (194,162) | $ | 80,557 | $ | 80,343 | |||||||||||
Expenditures for long-lived assets by segment: | |||||||||||||||||
U.S. Direct Lending | $ | 18,173 | $ | 13,450 | $ | 10,079 | |||||||||||
Canada Direct Lending | 6,768 | 2,238 | 639 | ||||||||||||||
Canada POS Lending | 20,880 | 7,891 | — | ||||||||||||||
Consolidated expenditures for long-lived assets | $ | 45,821 | $ | 23,579 | $ | 10,718 | |||||||||||
(1) For revenue by product, see Note 2, "Loans Receivable and Revenue." |
December 31, 2022 | December 31, 2021 | |||||||||||||
U.S. Direct Lending | $ | 773,380 | $ | 661,945 | ||||||||||
Canada Direct Lending | 481,015 | 427,197 | ||||||||||||
Canada POS Lending | 833,438 | 459,176 | ||||||||||||
Total gross loans receivable | $ | 2,087,833 | $ | 1,548,318 |
December 31, 2022 | December 31, 2021 | |||||||||||||
U.S. Direct Lending | $ | 13,993 | $ | 32,753 | ||||||||||
Canada Direct Lending | 15,239 | 21,072 | ||||||||||||
Canada POS Lending | 2,725 | 810 | ||||||||||||
Total net long-lived assets | $ | 31,957 | $ | 54,635 |
Fair Value | Useful Life | |||||||
Trade name | $ | 3,790 | 10.0 years | |||||
Customer relationships | 6,880 | 3.5 years | ||||||
Total identified intangible assets | $ | 10,670 |
Amounts acquired on December 27, 2021 | Measurement period adjustments | Amounts acquired on December 27, 2021 (as adjusted) | |||||||||
Assets | |||||||||||
Cash and cash equivalents | $ | 13,564 | $ | — | $ | 13,564 | |||||
Restricted cash | 33,630 | — | 33,630 | ||||||||
Gross loans receivable(1) | 471,630 | (15,379) | 456,251 | ||||||||
Income tax receivable | 3,526 | 4,209 | 7,735 | ||||||||
Prepaid expenses and other | 7,410 | — | 7,410 | ||||||||
Property and equipment | 4,748 | — | 4,748 | ||||||||
Right-of-use assets | 16,111 | — | 16,111 | ||||||||
Intangibles, net | 11,900 | — | 11,900 | ||||||||
Deferred tax asset | — | 2,477 | 2,477 | ||||||||
Other assets | 98 | — | 98 | ||||||||
Total assets | $ | 562,617 | $ | (8,693) | $ | 553,924 | |||||
Liabilities | |||||||||||
Accounts payable and accrued liabilities | $ | 19,186 | $ | 4,209 | $ | 23,395 | |||||
Lease liabilities | 16,315 | — | 16,315 | ||||||||
Deferred tax liability | 1,077 | (1,077) | — | ||||||||
Accrued interest on debt | 1,781 | — | 1,781 | ||||||||
Debt | 350,000 | — | 350,000 | ||||||||
Total liabilities | $ | 388,359 | $ | 3,132 | $ | 391,491 | |||||
Net assets acquired | $ | 174,258 | $ | (11,825) | $ | 162,433 | |||||
Total consideration paid | 428,115 | 428,115 | |||||||||
Goodwill | $ | 253,857 | $ | 265,682 | |||||||
(1) The gross contractual loans receivables as of December 27, 2021 were $485.4 million, of which the Company estimates $29.1 million will not be collected. |
Amounts acquired on March 10, 2021 | Measurement period adjustments | Amounts acquired on March 10, 2021 (as adjusted) | |||||||||
Assets | |||||||||||
Cash and cash equivalents | $ | 1,267 | $ | — | $ | 1,267 | |||||
Gross loans receivable(1) | 196,138 | — | 196,138 | ||||||||
Prepaid expenses and other | 687 | — | 687 | ||||||||
Property and equipment | 460 | — | 460 | ||||||||
Right-of-use assets | 616 | — | 616 | ||||||||
Intangibles | 50,876 | 3,572 | 54,448 | ||||||||
Deferred tax assets | 2,741 | 908 | 3,649 | ||||||||
Total assets | $ | 252,785 | $ | 4,480 | $ | 257,265 | |||||
Liabilities | |||||||||||
Accounts payable and accrued liabilities | $ | 9,356 | $ | — | $ | 9,356 | |||||
Credit facilities | 174,367 | — | 174,367 | ||||||||
Lease liabilities | 616 | — | 616 | ||||||||
Total liabilities | $ | 184,339 | $ | — | $ | 184,339 | |||||
Net assets acquired | $ | 68,446 | $ | 4,480 | $ | 72,926 | |||||
Total consideration paid | 113,347 | — | 113,347 | ||||||||
Goodwill | $ | 44,901 | $ | (4,480) | $ | 40,421 | |||||
(1) The gross contractual loans receivables as of March 10, 2021 were $208.6 million, of which the Company estimates $12.5 million will not be collected. |
Fair Value | Useful Life | |||||||
Developed technology | $ | 31,827 | 5.0 years | |||||
Merchant relationships | 19,684 | 5.0 years | ||||||
Customer relationships | 2,937 | 3.0 years | ||||||
Total identified intangible assets | $ | 54,448 |
(in thousands) | Amounts acquired on January 3, 2020 | ||||
Assets | |||||
Cash and cash equivalents | $ | 3,360 | |||
Accounts receivable | 465 | ||||
Property and equipment | 358 | ||||
Intangible assets | 1,101 | ||||
Goodwill | 14,791 | ||||
Operating lease asset | 235 | ||||
Total assets | $ | 20,310 | |||
Liabilities | |||||
Accounts payable and accrued liabilities | 2,264 | ||||
Operating lease liabilities | 235 | ||||
Total liabilities | $ | 2,499 | |||
Total cash consideration transferred | $ | 17,811 |
December 31, 2022 | December 31, 2021 | ||||||||||
Settlements and collateral due from third-party lenders (1) | $ | — | $ | 5,465 | |||||||
Fees receivable from customers under CSO programs (1) | — | 8,412 | |||||||||
Prepaid expenses | 13,963 | 16,243 | |||||||||
Other assets | 39,094 | 11,918 | |||||||||
Total prepaid expenses and other | $ | 53,057 | $ | 42,038 | |||||||
(1) All balances in connection with the CSO programs were disposed of on July 8, 2022 upon the completion of the divestiture of the Legacy U.S. Direct Lending Business. |
December 31, 2022 | December 31, 2021 | ||||||||||
Leasehold improvements | $ | 52,031 | $ | 122,049 | |||||||
Furniture, fixtures and equipment | 44,019 | 43,276 | |||||||||
Property and equipment, gross | 96,050 | 165,325 | |||||||||
Accumulated depreciation and amortization | (64,093) | (110,690) | |||||||||
Property and equipment, net | $ | 31,957 | $ | 54,635 |
December 31, 2022 | December 31, 2021 | ||||||||||
Trade accounts payable | $ | 14,100 | $ | 43,094 | |||||||
Money orders payable | 2,112 | 3,460 | |||||||||
Accrued taxes, other than income taxes | 1,248 | 1,053 | |||||||||
Accrued payroll and fringe benefits | 16,487 | 41,658 | |||||||||
Other accrued liabilities | 39,880 | 32,169 | |||||||||
Total accounts payable and accrued liabilities | $ | 73,827 | $ | 121,434 | |||||||
Employee Termination Benefits | Lease Exit Costs | Total Restructuring Costs | |||||||||
Salaries and Benefits | $ | 6,601 | $ | — | $ | 6,601 | |||||
Direct Operations | 1,266 | — | 1,266 | ||||||||
Other Operating Expense | — | 8,171 | 8,171 | ||||||||
Total | $ | 7,867 | $ | 8,171 | $ | 16,038 |
Total Restructuring Costs | |||||
Accrued restructuring costs as of October 5, 2022 | $ | — | |||
Restructuring costs incurred during the year ended December 31, 2022 | $ | 16,038 | |||
Amount paid during the year ended December 31, 2022 | $ | (11,292) | |||
Accrued restructuring costs as of December 31, 2022 | $ | 4,746 |
(in thousands) | Year Ended December 31, 2021 (1) | ||||
Store closure costs | |||||
Severance and employee costs | $ | 3,943 | |||
Lease termination costs | 1,710 | ||||
Net accelerated depreciation and write-off of ROU assets and lease liabilities | 7,064 | ||||
Total store closure costs | $ | 12,717 | |||
(1) During the year ended December 31, 2021, the Consolidated Statement of Operations included $3.9 million of store closure costs recorded within "Salaries and benefits" and $8.7 million recorded within "Other operating expense." |
For the Year Ended December 31, | |||||
2020 | |||||
Revenue | $ | — | |||
Provision for losses | — | ||||
Net revenue | — | ||||
Cost of providing services | |||||
Advertising | — | ||||
Non-advertising costs of providing services | — | ||||
Total cost of providing services | — | ||||
Gross margin | — | ||||
Operating expense (income) | |||||
Corporate, district and other expenses | — | ||||
Interest income | — | ||||
Gain on disposition | (1,714) | ||||
Total operating income | (1,714) | ||||
Pre-tax income from operations of discontinued operations | 1,714 | ||||
Income tax expense related to disposition | 429 | ||||
Net income from discontinued operations | $ | 1,285 | |||
2020 | ||||||||
Net cash provided by discontinued operating activities | $ | 1,714 | ||||||
Net cash used in discontinued investing activities | — | |||||||
Net cash used in discontinued financing activities | — | |||||||
For the Year Ended December 31, 2022 | For the Year Ended December 31, 2021 | |||||||
Total number of shares repurchased | 824,477 | 2,218,333 | ||||||
Average price paid per share | $ | 15.20 | $ | 16.86 | ||||
Total value of shares repurchased | $ | 12,530 | $ | 37,400 |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options (a)(1) | Weighted Average Exercise Price of Outstanding Options (b)(2) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities reflected in column(a)) (c)(3) | ||||||||
Equity compensation plans approved by security holders | 4,484,009 | $ | 4.83 | 2,967,721 | |||||||
Equity compensation plans not approved by security holders | — | — | — | ||||||||
Total | 4,484,009 | $ | 4.83 | 2,967,721 | |||||||
(1)This amount includes 515,088 shares of common stock to be issued for stock options and 3,824,431 shares of common stock to be issued upon the vesting of RSU's. | |||||||||||
(2) This amount represents only the stock options outstanding as of December 31, 2022, since RSU awards do not have an exercise price. | |||||||||||
(3) This amount represents securities issuable under the 2017 Incentive Plan which is comprised of only RSU's as of December 31, 2022. |
(1) | Consolidated Financial Statements | ||||
The consolidated financial statements and related notes, together with the reports of Deloitte & Touche LLP, appear in Part II, Item 8. "Financial Statements and Supplementary Data" of this Report. The consolidated financial statements consist of the following: | |||||
Consolidated Balance Sheets as of December 31, 2022 and 2021 | |||||
Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020 | |||||
Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2022, 2021 and 2020 | |||||
Consolidated Statements of Changes in Equity for the years ended December 31, 2022, 2021 and 2020 | |||||
Consolidated Statements of Cash Flows for the years ended December 31, 2022, 2021 and 2020 | |||||
Notes to Consolidated Financial Statements | |||||
(2) | Consolidated Financial Statement Schedules | ||||
All schedules have been omitted because they are not applicable, are insignificant or the required information is shown in the consolidated financial statements or notes thereto. | |||||
(3) | Exhibits | ||||
The exhibits are listed on the Exhibit Index. |
Exhibit | Description | Filed/Incorporated by Reference from Form | Incorporated by Reference from Exhibit Number | Filing Date | ||||||||||
2.1 | 10-K | 2.1 | 3/5/21 | |||||||||||
2.2 | 8-K | 2.1 | 11/19/21 | |||||||||||
2.3 | 8-K | 2.1 | 5/19/22 | |||||||||||
2.4 | 8-K | 2.2 | 7/14/22 | |||||||||||
2.5 | 8-K | 2.2 | 5/19/22 | |||||||||||
2.6 | 8-K | 2.4 | 7/14/22 | |||||||||||
3.1 | 10-Q | 10.1 | 8/5/20 | |||||||||||
3.2 | 8-K | 3.2 | 12/11/17 | |||||||||||
4.1 | S-1 | 4.1 | 11/28/17 | |||||||||||
4.2 | S-1 | 4.2 | 11/28/17 | |||||||||||
4.3 | S-1 | 4.3 | 5/14/18 | |||||||||||
4.4 | 8-K | 4.1 | 8/3/21 | |||||||||||
4.5 | 8-K | 4.1 | 12/3/21 | |||||||||||
4.6 | 8-K | 4.2 | 12/3/21 | |||||||||||
4.7 | 8-K | 4.1 | 12/28/21 | |||||||||||
4.8 | 10-K | 4.4 | 3/9/20 | |||||||||||
10.1 | 10-K | 10.6 | 3/7/22 |
10.15 | 10-K | 10.20 | 3/7/22 | |||||||||||
10.16 | 10-K | 10.21 | 3/7/22 | |||||||||||
10.17 | 10-K | 10.22 | 3/7/22 | |||||||||||
10.18 | 10-K | 10.23 | 3/7/22 | |||||||||||
10.19 | 10-K | 10.24 | 3/7/22 | |||||||||||
10.20 | Credit Agreement, dated as of July 13, 2022, among First Heritage Financing I, LLC, First Heritage Credit, LLC, the lenders and agents from time to time party thereto, the subservicers party thereto, Computershare Trust Company, National Association, Wilmington Trust, National Association and Credit Suisse AG, New York Branch¥ | 8-K | 10.1 | 7/14/22 | ||||||||||
10.21 | Credit Agreement, dated as of July 15, 2022, among Heights Financing I, LLC, SouthernCo, Inc., the lenders and agents from time to time party thereto, the subservicers party thereto, Computershare Trust Company, National Association, Wilmington Trust, National Association and Credit Suisse AG, New York Branch* ¥ | 8-K | 10.1 | 7/20/22 | ||||||||||
10.22 | S-1 | 10.26 | 10/24/17 | |||||||||||
10.23 | 10-K | 10.28 | 3/7/22 | |||||||||||
10.24 | 10-K | 10.29 | 3/7/22 | |||||||||||
10.25 | 10-Q | 10.1 | 7/28/21 | |||||||||||
10.26 | 10-Q | 10.2 | 7/28/21 | |||||||||||
10.27 | S-1 | 10.31 | 11/1/17 | |||||||||||
10.28 | S-1 | 10.7 | 10/24/17 | |||||||||||
10.29 | S-1 | 10.57 | 10/24/17 |
/s/ Douglas Clark | |||||
Douglas Clark | |||||
Chief Executive Officer and a Director | |||||
(Principal Executive Officer) | |||||
March 9, 2023 | |||||
/s/ Ismail Dawood | |||||
Ismail Dawood | |||||
Chief Financial Officer | |||||
(Principal Financial Officer) | |||||
March 9, 2023 | |||||
/s/ Tamara Schulz | |||||
Tamara Schulz | |||||
Chief Accounting Officer | |||||
(Principal Accounting Officer) | |||||
March 9, 2023 | |||||
* | |||||
Chad Faulkner | |||||
Chairman of Board of Directors | |||||
March 9, 2023 | |||||
* | |||||
Andrew Frawley | |||||
Director | |||||
March 9, 2023 | |||||
* | |||||
David M. Kirchheimer | |||||
Director | |||||
March 9, 2023 | |||||
* | |||||
Chris Masto | |||||
Director |
March 9, 2023 | |||||
* | |||||
Mike McKnight | |||||
Director | |||||
March 9, 2023 | |||||
* | |||||
Gillian Van Schaick | |||||
Director | |||||
March 9, 2023 | |||||
* | |||||
Issac Vaughn | |||||
Director | |||||
March 9, 2023 | |||||
* /s/ Ismail Dawood | |||||
Ismail Dawood | |||||
Attorney-in-Fact | |||||
March 9, 2023 |
1 Year CURO Chart |
1 Month CURO Chart |
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