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Share Name | Share Symbol | Market | Type |
---|---|---|---|
PROG Holdings Inc | NYSE:PRG | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.22 | 0.61% | 36.36 | 36.46 | 35.74 | 36.15 | 318,276 | 01:00:00 |
PROG Holdings, Inc. (NYSE:PRG), the fintech holding company for Progressive Leasing, Vive Financial, Four Technologies, and Build, today announced financial results for the fourth quarter ended December 31, 2023, and the initiation of a quarterly cash dividend for shareholders, as well as a $500 million share repurchase authorization.
"We were pleased to finish 2023 with financial results that matched or exceeded our outlook, as strong customer behavior and conversion rates during the holiday period drove a year-over-year increase in quarterly GMV, due in part to marketing and other initiatives we put in place with our retail partners," said PROG Holdings President and CEO Steve Michaels. "Our portfolio remains healthy, and we continue to effectively manage its performance while maintaining cost discipline in the face of challenging retail conditions, enabling us to deliver strong results for both the fourth quarter and the full year. Our focus remains on our three-pillared strategy to grow, enhance, and expand, while our active management of our portfolio and SG&A spend allows us to invest in key growth initiatives, positioning us for future success."
"Additionally, our Board of Directors has approved payment of a quarterly cash dividend of $0.12 per share of Company common stock in the first quarter of 2024 alongside a new $500 million share repurchase authorization," Michaels continued. "We believe our cash-efficient model will allow us to reinvest in the business while pursuing a balanced capital return strategy for our shareholders."
Consolidated Results
Consolidated revenues for the fourth quarter of 2023 were $577.4 million, a decrease of 5.7% from the same period in 2022, driven by a lower gross leased asset balance entering the quarter.
Consolidated net earnings for the quarter were $18.6 million, compared with $36.1 million in the prior year period. Adjusted EBITDA for the quarter decreased 18.1% to $61.0 million, or 10.6% of revenues, compared with $74.4 million, or 12.2% of revenues for the same period in 2022. The year-over-year decline in adjusted EBITDA was driven primarily by a decline in revenue and deleveraging of SG&A, partially offset by customer payment performance.
Diluted earnings per share for the fourth quarter of 2023 were $0.41, compared with $0.73 in the year ago period. On a non-GAAP basis, diluted earnings per share were $0.72 in the fourth quarter of 2023, compared with $0.84 for the same period in 2022. The Company's weighted average shares outstanding assuming dilution in the fourth quarter was 8.3% lower year-over-year.
Progressive Leasing Results
Progressive Leasing's fourth quarter GMV increased 1.2% year over year to $547.6 million, primarily driven by better-than-expected customer demand for leasable items during the holidays. The provision for lease merchandise write-offs for the quarter was 7.0%, within the Company's 6%-8% targeted annual range.
Capital Returns
PROG Holdings ended the fourth quarter of 2023 with cash of $155.4 million and gross debt of $600 million. The Company repurchased $31.3 million of its stock in the quarter at an average price of $28.35 per share. PROG Holdings’ Board has authorized a total of $500 million of share repurchases under the Company’s existing share repurchase program, as well as a quarterly cash dividend of $0.12 per share of the Company's common stock, payable on March 28, 2024 to shareholders of record at the close of business on March 14, 2024. While the Company expects to continue paying a quarterly cash dividend going forward, the future payment of dividends will be at the sole discretion of our Board of Directors and will depend on many factors, including our earnings, financial condition, and other considerations that our Board of Directors deems relevant.
2024 Outlook
PROG Holdings is issuing full year and Q1 2024 outlook for revenues, consolidated net earnings, segment earnings before taxes, adjusted EBITDA, diluted GAAP EPS, and diluted non-GAAP EPS. This outlook assumes a difficult operating environment with continued soft demand for consumer durable goods, no material changes in the Company's decisioning posture, an effective tax rate for non-GAAP EPS of approximately 29%, no material increases in the unemployment rate for our consumer, and no impact from additional share repurchases.
Full Year 2024 Outlook
(In thousands, except per share amounts)
Low
High
PROG Holdings - Total Revenues
$
2,235,000
$
2,335,000
PROG Holdings - Net Earnings
89,500
105,000
PROG Holdings - Adjusted EBITDA
230,000
250,000
PROG Holdings - Diluted EPS
2.00
2.34
PROG Holdings - Diluted Non-GAAP EPS
2.70
3.00
Progressive Leasing - Total Revenues
2,160,000
2,240,000
Progressive Leasing - Earnings Before Taxes
147,000
164,000
Progressive Leasing - Adjusted EBITDA
241,000
256,000
Vive - Total Revenues
55,000
65,000
Vive - Earnings Before Taxes
1,500
3,000
Vive - Adjusted EBITDA
3,000
5,000
Other - Total Revenues
20,000
30,000
Other - Loss Before Taxes
(20,000
)
(18,000
)
Other - Adjusted EBITDA
(14,000
)
(11,000
)
Three Months Ended March 31, 2024 Outlook
(In thousands, except per share amounts)
Low
High
PROG Holdings - Total Revenues
$
620,000
$
640,000
PROG Holdings - Net Earnings
14,500
19,500
PROG Holdings - Adjusted EBITDA
62,000
68,000
PROG Holdings - Diluted EPS
0.34
0.44
PROG Holdings - Diluted Non-GAAP EPS
0.80
0.85
Conference Call and Webcast
The Company has scheduled a live webcast and conference call for Wednesday, February 21, 2024, at 8:30 A.M. ET to discuss its financial results for the fourth quarter of 2023. To access the live webcast, visit the Events and Presentations page of the Company’s Investor Relations website, https://investor.progholdings.com/.
About PROG Holdings, Inc.
PROG Holdings, Inc. (NYSE:PRG) is a fintech holding company headquartered in Salt Lake City, UT, that provides transparent and competitive payment options to consumers. The Company owns Progressive Leasing, a leading provider of e-commerce, app-based, and in-store point-of-sale lease-to-own solutions, Vive Financial, an omnichannel provider of second-look revolving credit products, Four Technologies, a provider of Buy Now, Pay Later payment options through its platform, Four, and Build, provider of personal credit building products. More information on PROG Holdings and its companies can be found at https://investor.progholdings.com/.
Forward Looking Statements:
Statements in this news release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements generally can be identified by the use of forward-looking terminology, such as "continue", "allow", "believe", "payable", "expects", "outlook", "will", "assumes" and similar forward-looking terminology. These risks and uncertainties include factors such as (i) continued volatility and challenges in the macro environment and, in particular, the unfavorable effects on our business of significant inflation, elevated interest rates, and fears of a recession, and the impact of those headwinds on: (a) consumer confidence and customer demand for the merchandise that our POS partners sell, in particular consumer durables; (b) our customers’ disposable income and their ability to make the lease and loan payments they owe the Company; (c) the availability of consumer credit; and (d) our overall financial performance and outlook; (ii) our businesses being subject to extensive laws and regulations, including laws and regulations unique to the industries in which our businesses operate, that may subject them to government investigations and significant monetary penalties and compliance-related burdens, as well as an increased focus by federal, state and local regulators on the industries within which our businesses operate, including with respect to consumer protection, customer privacy, third party and employee fraud and information security; (iii) deteriorating macroeconomic conditions resulting in the algorithms and other proprietary decisioning tools used in approving Progressive Leasing and Vive customers for leases and loans no longer being indicative of their ability to perform, which may limit the ability of those businesses to avoid lease and loan charge-offs or may result in their reserves being insufficient to cover actual losses; (iv) the impact of the cybersecurity incident experienced by Progressive Leasing in September 2023 and expenses incurred in connection with responding to the matter, including the litigation filed in response to that incident, or any regulatory proceedings that may result from the incident; (v) a large percentage of the Company’s revenues being concentrated with several of Progressive Leasing’s key POS partners; (vi) the risks that Progressive Leasing will be unable to attract new POS partners or retain and grow its business with its existing POS partners; (vii) Vive’s and Four’s business models differing significantly from Progressive Leasing’s, which creates specific and unique risks for each of the Vive and Four businesses, including Vive’s reliance on a limited number of bank partners to issue its credit products and each of Vive’s and Four’s exposure to the unique regulatory risks associated with the laws and regulations that apply to each of their businesses; (viii) our ability to continue to protect confidential, proprietary, or sensitive information, including the personal and confidential information of our customers, which may be adversely affected by cyber-attacks, employee or other internal misconduct, computer viruses, electronic break-ins or "hacking", or similar disruptions, any one of which could have a material adverse impact on our results of operations, financial condition, and prospects; (ix) our cost reduction initiatives may not be adequate or may have unintended consequences that could be disruptive to our businesses, including with respect to our global workforce strategy; (x) the risk that our capital allocation strategy, including our current stock repurchase and dividend programs, as well as any future debt repurchase program, will not be effective at enhancing shareholder value and may have an adverse impact on our cash reserves; (xi) the loss of the services of our key executives or our inability to attract and retain key talent, particularly with respect to our information technology function, may have a material adverse impact on our operations; (xii) increased competition from traditional and virtual lease-to-own competitors and also from competitors of our Vive segment; (xiii) the transactions offered by our Progressive Leasing, Vive and/or Four businesses may be negatively characterized by government officials, consumer advocacy groups or the media; (xiv) real or perceived software or system errors, failures, bugs, defects or outages, including those that may be caused by third-party vendors, may adversely affect Progressive Leasing, Vive or Four; and (xv) the other risks and uncertainties discussed under "Risk Factors" in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 21, 2024. Statements in this press release that are "forward-looking" include without limitation statements about: (i) the benefits expected from our stock repurchase program and from our payment of a quarterly cash dividend, and our expectations regarding paying such a dividend going forward; (ii) the health of our lease portfolio and our ability to effectively manage that portfolio performance and SG&A spending; (iii) our ability to invest in our business, including in our key growth initiatives; (iv) our expectations regarding our cash efficiency and our capital return strategy; and (v) our outlook for the first quarter and full year 2024. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as required by law, the Company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances after the date of this press release.
PROG Holdings, Inc.
Consolidated Statements of Earnings
(In thousands, except per share data)
(Unaudited) Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
REVENUES:
Lease Revenues and Fees
$
557,484
$
592,942
$
2,333,588
$
2,523,785
Interest and Fees on Loans Receivable
19,917
19,155
74,676
74,041
577,401
612,097
2,408,264
2,597,826
COSTS AND EXPENSES:
Depreciation of Lease Merchandise
374,146
399,017
1,576,303
1,757,730
Provision for Lease Merchandise Write-offs
38,955
38,271
155,250
193,926
Operating Expenses
128,932
112,377
451,084
450,374
Impairment of Goodwill
—
—
—
10,151
542,033
549,665
2,182,637
2,412,181
OPERATING PROFIT
35,368
62,432
225,627
185,645
Interest Expense, Net
(6,857
)
(8,701
)
(29,406
)
(37,401
)
EARNINGS BEFORE INCOME TAX EXPENSE
28,511
53,731
196,221
148,244
INCOME TAX EXPENSE
9,936
17,646
57,383
49,535
NET EARNINGS
$
18,575
$
36,085
$
138,838
$
98,709
EARNINGS PER SHARE
Basic
$
0.42
$
0.74
$
3.02
$
1.90
Assuming Dilution
$
0.41
$
0.73
$
2.98
$
1.90
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic
44,337
49,029
46,034
51,921
Assuming Dilution
45,075
49,170
46,550
52,075
PROG Holdings, Inc.
Consolidated Balance Sheets
(In thousands, except share data)
December 31, 2023
December 31, 2022
ASSETS:
Cash and Cash Equivalents
$
155,416
$
131,880
Accounts Receivable (net of allowances of $64,180 in 2023 and $69,264 in 2022)
67,879
64,521
Lease Merchandise (net of accumulated depreciation and allowances of $423,466 in 2023 and $467,355 in 2022)
633,427
648,043
Loans Receivable (net of allowances and unamortized fees of $50,022 in 2023 and $53,635 in 2022)
126,823
130,966
Property and Equipment, Net
24,104
23,852
Operating Lease Right-of-Use Assets
9,271
11,875
Goodwill
296,061
296,061
Other Intangibles, Net
91,664
114,411
Income Tax Receivable
32,918
18,864
Deferred Income Tax Assets
2,981
2,955
Prepaid Expenses and Other Assets
50,711
48,481
Total Assets
$
1,491,255
$
1,491,909
LIABILITIES & SHAREHOLDERS’ EQUITY:
Accounts Payable and Accrued Expenses
$
151,259
$
135,025
Deferred Income Tax Liabilities
104,838
137,261
Customer Deposits and Advance Payments
35,713
37,074
Operating Lease Liabilities
15,849
21,122
Debt
592,265
590,966
Total Liabilities
899,924
921,448
SHAREHOLDERS' EQUITY:
Common Stock, Par Value $0.50 Per Share: Authorized: 225,000,000 Shares at December 31, 2023 and 2022; Shares Issued: 82,078,654 at December 31, 2023 and 2022
41,039
41,039
Additional Paid-in Capital
352,421
338,814
Retained Earnings
1,293,073
1,154,235
1,686,533
1,534,088
Less: Treasury Shares at Cost
Common Stock: 38,404,527 Shares at December 31, 2023 and 34,044,102 at December 31, 2022
(1,095,202
)
(963,627
)
Total Shareholders’ Equity
591,331
570,461
Total Liabilities & Shareholders’ Equity
$
1,491,255
$
1,491,909
PROG Holdings, Inc.
Consolidated Statements of Cash Flows
(In thousands)
Year Ended December 31,
2023
2022
OPERATING ACTIVITIES:
Net Earnings
$
138,838
$
98,709
Adjustments to Reconcile Net Earnings to Cash Provided by Operating Activities:
Depreciation of Lease Merchandise
1,576,303
1,757,730
Other Depreciation and Amortization
32,032
33,851
Provisions for Accounts Receivable and Loan Losses
345,383
417,496
Stock-Based Compensation
24,920
17,521
Deferred Income Taxes
(32,449
)
(9,199
)
Impairment of Goodwill
—
10,151
Non-Cash Lease Expense
(2,669
)
(1,674
)
Other Changes, Net
(5,992
)
(7,164
)
Changes in Operating Assets and Liabilities:
Additions to Lease Merchandise
(1,721,117
)
(1,889,207
)
Book Value of Lease Merchandise Sold or Disposed
159,430
197,489
Accounts Receivable
(307,984
)
(374,515
)
Prepaid Expenses and Other Assets
(2,110
)
68
Income Tax Receivable and Payable
(14,188
)
(6,007
)
Operating Lease Right-of-Use Assets and Liabilities
—
2,999
Accounts Payable and Accrued Expenses
15,200
2,227
Customer Deposits and Advance Payments
(1,361
)
(7,996
)
Cash Provided by Operating Activities
204,236
242,479
INVESTING ACTIVITIES:
Investments in Loans Receivable
(214,686
)
(203,600
)
Proceeds from Loans Receivable
185,056
159,707
Outflows on Purchases of Property and Equipment
(9,616
)
(9,674
)
Proceeds from Property and Equipment
48
27
Proceeds from Acquisitions of Businesses
365
6
Cash Used in Investing Activities
(38,833
)
(53,534
)
FINANCING ACTIVITIES:
Acquisition of Treasury Stock
(139,573
)
(223,598
)
Tender Offer Shares Repurchased and Retired
—
(274
)
Issuance of Stock Under Stock Option and Employee Purchase Plans
1,357
1,150
Shares Withheld for Tax Payments
(3,622
)
(2,902
)
Debt Issuance Costs
(29
)
(1,600
)
Cash Used in Financing Activities
(141,867
)
(227,224
)
Increase (Decrease) in Cash and Cash Equivalents
23,536
(38,279
)
Cash and Cash Equivalents at Beginning of Year
131,880
170,159
Cash and Cash Equivalents at End of Year
$
155,416
$
131,880
Net Cash Paid During the Year:
Interest
$
36,991
$
35,712
Income Taxes
$
100,433
$
62,172
PROG Holdings, Inc.
Quarterly Revenues by Segment
(In thousands)
(Unaudited)
Three Months Ended
December 31, 2023
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
557,484
$
—
$
—
$
557,484
Interest and Fees on Loans Receivable
—
17,025
2,892
19,917
Total Revenues
$
557,484
$
17,025
$
2,892
$
577,401
(Unaudited)
Three Months Ended
December 31, 2022
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
592,942
$
—
$
—
$
592,942
Interest and Fees on Loans Receivable
—
17,886
1,269
19,155
Total Revenues
$
592,942
$
17,886
$
1,269
$
612,097
PROG Holdings, Inc.
Annual Revenues by Segment
(In thousands)
Twelve Months Ended
December 31, 2023
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
2,333,588
$
—
$
—
$
2,333,588
Interest and Fees on Loans Receivable
—
68,912
5,764
74,676
Total Revenues
$
2,333,588
$
68,912
$
5,764
$
2,408,264
Twelve Months Ended
December 31, 2022
Progressive Leasing
Vive
Other
Consolidated Total
Lease Revenues and Fees
$
2,523,785
$
—
$
—
$
2,523,785
Interest and Fees on Loans Receivable
—
70,911
3,130
74,041
Total Revenues
$
2,523,785
$
70,911
$
3,130
$
2,597,826
PROG Holdings, Inc.
Gross Merchandise Volume by Quarter
(In thousands)
(Unaudited)
Three Months Ended December 31,
2023
2022
Progressive Leasing
$
547,575
$
540,913
Vive
31,918
40,417
Other
53,260
26,192
Total GMV
$
632,753
$
607,522
Use of Non-GAAP Financial Information:
Non-GAAP net earnings, non-GAAP diluted earnings per share, and adjusted EBITDA are supplemental measures of our performance that are not calculated in accordance with generally accepted accounting principles in the United States ("GAAP"). Non-GAAP diluted earnings per share for the full year 2024 and first quarter 2024 outlook exclude intangible amortization expense, restructuring expenses, and accrued interest on an uncertain tax position related to Progressive Leasing's $175 million settlement with the FTC in 2020. Non-GAAP net earnings and non-GAAP diluted earnings per share for the three and twelve months ended December 31, 2023 exclude intangible amortization expense, restructuring expenses, costs related to the cybersecurity incident, regulatory insurance recoveries, and accrued interest on an uncertain tax position related to Progressive Leasing's $175 million settlement with the FTC in 2020. Non-GAAP net earnings and non-GAAP diluted earnings per share for the three and twelve months ended December 31, 2022, exclude intangible amortization expense, restructuring expenses, impairment of goodwill and accrued interest on an uncertain tax position related to Progressive Leasing's $175 million settlement with the FTC in 2020. The amount for the after-tax non-GAAP adjustment, which is tax effected using our statutory tax rate, can be found in the reconciliation of net earnings and earnings per share assuming dilution to non-GAAP net earnings and earnings per share assuming dilution table in this press release.
The Adjusted EBITDA figures presented in this press release are calculated as the Company’s earnings before interest expense, net, depreciation on property and equipment, amortization of intangible assets and income taxes. Adjusted EBITDA for the full year 2024 and first quarter 2024 outlook exclude stock-based compensation expense and restructuring expenses. Adjusted EBITDA for the three and twelve months ended December 31, 2023, exclude stock-based compensation expense, restructuring expenses, costs related to the cybersecurity incident and regulatory insurance recoveries. Adjusted EBITDA for the three and twelve months ended December 31, 2022, exclude stock-based compensation expense, restructuring expenses and impairment of goodwill. The amounts for these pre-tax non-GAAP adjustments can be found in the segment EBITDA tables in this press release.
Management believes that non-GAAP net earnings, non-GAAP diluted earnings per share, and adjusted EBITDA provide relevant and useful information, and are widely used by analysts, investors and competitors in our industry as well as by our management in assessing both consolidated and business unit performance.
Non-GAAP net earnings, non-GAAP diluted earnings, and adjusted EBITDA provide management and investors with an understanding of the results from the primary operations of our business by excluding the effects of certain items that generally arose from larger, one-time transactions that are not reflective of the ordinary earnings activity of our operations or transactions that have variability and volatility of the amount. We believe the exclusion of stock-based compensation expense provides for a better comparison of our operating results with our peer companies as the calculations of stock-based compensation vary from period to period and company to company due to different valuation methodologies, subjective assumptions and the variety of award types. This measure may be useful to an investor in evaluating the underlying operating performance of our business.
Adjusted EBITDA also provides management and investors with an understanding of one aspect of earnings before the impact of investing and financing charges and income taxes. These measures may be useful to an investor in evaluating our operating performance because the measures:
Non-GAAP financial measures, however, should not be used as a substitute for, or considered superior to, measures of financial performance prepared in accordance with GAAP, such as the Company’s GAAP basis net earnings and diluted earnings per share and the GAAP revenues and earnings before income taxes of the Company’s segments, which are also presented in the press release. Further, we caution investors that amounts presented in accordance with our definitions of non-GAAP net earnings, non-GAAP diluted earnings per share, and adjusted EBITDA may not be comparable to similar measures disclosed by other companies, because not all companies and analysts calculate these measures in the same manner.
PROG Holdings, Inc.
Reconciliation of Net Earnings and Earnings Per Share Assuming Dilution to Non-GAAP Net Earnings and Earnings Per Share Assuming Dilution
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
Twelve Months Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Dec 31,
2023
Net Earnings
$
48,033
$
37,218
$
35,012
$
18,575
$
138,838
Add: Intangible Amortization Expense
5,724
5,723
5,650
5,651
22,748
Add: Restructuring Expense
757
963
238
10,575
12,533
Add: Costs Related to the Cybersecurity Incident
—
—
1,805
1,028
2,833
Less: Regulatory Insurance Recoveries
(525
)
—
—
—
(525
)
Less: Tax Impact of Adjustments(1)
(1,549
)
(1,738
)
(2,000
)
(4,486
)
(9,773
)
Add: Accrued Interest on FTC Settlement Uncertain Tax Position
970
970
971
1,078
3,989
Non-GAAP Net Earnings
$
53,410
$
43,136
$
41,676
$
32,421
$
170,643
Earnings Per Share Assuming Dilution
$
1.00
$
0.79
$
0.76
$
0.41
$
2.98
Add: Intangible Amortization Expense
0.12
0.12
0.12
0.13
0.49
Add: Restructuring Expense
0.02
0.02
0.01
0.23
0.27
Add: Costs Related to the Cybersecurity Incident
—
—
0.04
0.02
0.06
Less: Regulatory Insurance Recoveries
(0.01
)
—
—
—
(0.01
)
Less: Tax Impact of Adjustments(1)
(0.03
)
(0.04
)
(0.04
)
(0.10
)
(0.21
)
Add: Accrued Interest on FTC Settlement Uncertain Tax Position
0.02
0.02
0.02
0.02
0.09
Non-GAAP Earnings Per Share Assuming Dilution(2)
$
1.11
$
0.92
$
0.90
$
0.72
$
3.67
Weighted Average Shares Outstanding Assuming Dilution
48,139
46,896
46,133
45,075
46,550
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
PROG Holdings, Inc.
Reconciliation of Net Earnings and Earnings Per Share Assuming Dilution to Non-GAAP Net Earnings and Earnings Per Share Assuming Dilution
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
Twelve Months Ended
Mar 31,
Jun 30,
Sept 30,
Dec 31,
Dec 31,
2022
Net Earnings
$
27,135
$
19,484
$
16,005
$
36,085
$
98,709
Add: Intangible Amortization Expense
5,724
5,723
5,724
5,723
22,894
Add: Restructuring Expense
—
4,328
4,673
—
9,001
Add: Impairment of Goodwill
—
—
10,151
—
10,151
Less: Tax Impact of Adjustments(1)
(1,488
)
(2,613
)
(2,703
)
(1,488
)
(8,292
)
Add: Accrued Interest on FTC Settlement Uncertain Tax Position
539
647
755
972
2,913
Non-GAAP Net Earnings
$
31,910
$
27,569
$
34,605
$
41,292
$
135,376
Earnings Per Share Assuming Dilution
$
0.49
$
0.37
$
0.32
$
0.73
$
1.90
Add: Intangible Amortization Expense
0.10
0.11
0.11
0.12
0.44
Add: Restructuring Expense
—
0.08
0.09
—
0.17
Add: Impairment of Goodwill
—
—
0.20
—
0.19
Less: Tax Impact of Adjustments(1)
(0.03
)
(0.05
)
(0.05
)
(0.03
)
(0.16
)
Add: Accrued Interest on FTC Settlement Uncertain Tax Position
0.01
0.01
0.01
0.02
0.06
Non-GAAP Earnings Per Share Assuming Dilution(2)
$
0.57
$
0.52
$
0.68
$
0.84
$
2.60
Weighted Average Shares Outstanding Assuming Dilution
55,706
52,961
50,547
49,170
52,075
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
PROG Holdings, Inc.
Non-GAAP Financial Information
Quarterly Segment EBITDA
(In thousands)
(Unaudited)
Three Months Ended
December 31, 2023
Progressive Leasing
Vive
Other
Consolidated Total
Net Earnings
$
18,575
Income Tax Expense(1)
9,936
Earnings (Loss) Before Income Tax Expense
$
35,857
$
59
$
(7,405
)
28,511
Interest Expense, Net
6,915
24
(82
)
6,857
Depreciation
1,941
211
353
2,505
Amortization
5,422
—
229
5,651
EBITDA
50,135
294
(6,905
)
43,524
Stock-Based Compensation
4,024
306
1,509
5,839
Restructuring Expense
10,575
—
—
10,575
Costs Related to the Cybersecurity Incident
1,028
—
—
1,028
Adjusted EBITDA
$
65,762
$
600
$
(5,396
)
$
60,966
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
(Unaudited)
Three Months Ended
December 31, 2022
Progressive Leasing
Vive
Other
Consolidated Total
Net Earnings
$
36,085
Income Tax Expense(1)
17,646
Earnings (Loss) Before Income Tax Expense
$
61,187
$
41
$
(7,497
)
53,731
Interest Expense, Net
8,590
111
—
8,701
Depreciation
2,283
199
200
2,682
Amortization
5,420
—
303
5,723
EBITDA
77,480
351
(6,994
)
70,837
Stock-Based Compensation
2,925
100
566
3,591
Adjusted EBITDA
$
80,405
$
451
$
(6,428
)
$
74,428
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
PROG Holdings, Inc.
Non-GAAP Financial Information
Twelve Month Segment EBITDA
(In thousands)
Twelve Months Ended
December 31, 2023
Progressive Leasing
Vive
Other
Consolidated Total
Net Earnings
$
138,838
Income Tax Expense(1)
57,383
Earnings (Loss) Before Income Tax Expense
$
216,271
$
4,545
$
(24,595
)
196,221
Interest Expense, Net
28,978
593
(165
)
29,406
Depreciation
7,482
745
1,058
9,285
Amortization
21,684
—
1,064
22,748
EBITDA
274,415
5,883
(22,638
)
257,660
Stock-Based Compensation
17,327
1,190
6,403
24,920
Restructuring Expense
12,533
—
—
12,533
Regulatory Insurance Recoveries
(525
)
—
—
(525
)
Costs Related to the Cybersecurity Incident
2,833
—
—
2,833
Adjusted EBITDA
$
306,583
$
7,073
$
(16,235
)
$
297,421
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
Twelve Months Ended
December 31, 2022
Progressive Leasing
Vive
Other
Consolidated Total
Net Earnings
$
98,709
Income Tax Expense(1)
49,535
Earnings (Loss) Before Income Tax Expense
$
174,143
$
9,195
$
(35,094
)
148,244
Interest Expense, Net
37,003
398
—
37,401
Depreciation
9,691
795
471
10,957
Amortization
21,683
—
1,211
22,894
EBITDA
242,520
10,388
(33,412
)
219,496
Stock-Based Compensation
12,633
391
4,497
17,521
Restructuring Expense
8,343
658
—
9,001
Impairment of Goodwill
—
—
10,151
10,151
Adjusted EBITDA
$
263,496
$
11,437
$
(18,764
)
$
256,169
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
PROG Holdings, Inc.
Non-GAAP Financial Information
Reconciliation of Full Year 2024 Outlook for Adjusted EBITDA
(In thousands)
Fiscal Year 2024 Ranges
Progressive Leasing
Vive
Other
Consolidated Total
Estimated Net Earnings
$89,500 - $105,000
Income Tax Expense(1)
39,000 - 44,000
Projected Earnings (Loss) Before Income Tax Expense
$147,000 - $164,000
$1,500 - $3,000
$(20,000) - $(18,000)
128,500 - 149,000
Interest Expense, Net
31,000 - 29,000
—
—
31,000 - 29,000
Depreciation
8,000
500
2,000
10,500
Amortization
17,000
—
1,000
18,000
Projected EBITDA
203,000 - 218,000
2,000 - 3,500
(17,000) - (15,000)
188,000 - 206,500
Stock-Based Compensation
18,000 - 20,000
1,000 - 1,500
3,000 - 4,000
22,000 - 25,500
Restructuring Expense
20,000 - 18,000
—
—
20,000 - 18,000
Projected Adjusted EBITDA
$241,000 - $256,000
$3,000 - $5,000
$(14,000) - $(11,000)
$230,000 - $250,000
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
PROG Holdings, Inc.
Non-GAAP Financial Information
Reconciliation of the Three Months Ended March 31, 2024 Outlook for Adjusted EBITDA
(In thousands)
Three Months Ended March 31, 2024 Outlook
Consolidated Total
Estimated Net Earnings
$14,500 - $19,500
Income Tax Expense(1)
6,000 - 8,000
Projected Earnings Before Income Tax Expense
20,500 - 27,500
Interest Expense, Net
8,000 - 7,500
Depreciation
2,500
Amortization
6,000
Projected EBITDA
37,000 - 43,500
Stock-Based Compensation
5,000 - 6,500
Restructuring Expense
20,000 - 18,000
Projected Adjusted EBITDA
$62,000 - $68,000
(1)
Taxes are calculated on a consolidated basis and are not identifiable by Company segment.
PROG Holdings, Inc.
Reconciliation of Full Year 2024 Outlook for Earnings Per Share
Assuming Dilution to Non-GAAP Earnings Per Share Assuming Dilution
Full Year 2024
Low
High
Projected Earnings Per Share Assuming Dilution
$
2.00
$
2.34
Add: Projected Intangible Amortization Expense
0.40
0.40
Add: Projected Interest on FTC Settlement Uncertain Tax Position
0.07
0.07
Add: Projected Restructuring Expense
0.44
0.40
Subtract: Tax Effect on Non-GAAP Adjustments(1)
(0.22
)
(0.21
)
Projected Non-GAAP Earnings Per Share Assuming Dilution(2)
$
2.70
$
3.00
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
PROG Holdings, Inc.
Reconciliation of the Three Months Ended March 31, 2024 Outlook for Earnings Per Share
Assuming Dilution to Non-GAAP Earnings Per Share Assuming Dilution
Three Months Ended March 31, 2024
Low
High
Projected Earnings Per Share Assuming Dilution
$
0.34
$
0.44
Add: Projected Intangible Amortization Expense
0.13
0.13
Add: Projected Interest on FTC Settlement Uncertain Tax Position
0.02
0.02
Add: Projected Restructuring Expense
0.45
0.40
Subtract: Tax Effect on Non-GAAP Adjustments(1)
(0.15
)
(0.14
)
Projected Non-GAAP Earnings Per Share Assuming Dilution(2)
$
0.80
$
0.85
(1)
Adjustments are tax-effected using an assumed statutory tax rate of 26%.
(2)
In some cases, the sum of individual EPS amounts may not equal total non-GAAP EPS calculations due to rounding.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240221369993/en/
Investor Contact John Baugh, CFA Vice President, Investor Relations john.baugh@progleasing.com Media Contact Mark Delcorps Director, Corporate Communications media@progholdings.com
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