x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
DELAWARE | 86-0721358 | |
(State or other jurisdiction of Incorporation or organization) | (I.R.S. Employer Identification No.) |
ARIZONA | 82-0587346 | |
(State or other jurisdiction of Incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer | ¨ | Accelerated filer | ¨ | ||
Non-accelerated filer | x | (Do not check if a smaller reporting company) | Smaller reporting company | ¨ |
Page | |
PART I. | FINANCIAL INFORMATION |
Item 1. | Financial Statements |
March 31, 2013 | December 31, 2012 | ||||||
(In thousands) | |||||||
ASSETS | |||||||
Cash and Cash Equivalents | $ | 25,731 | $ | 26,480 | |||
Restricted Cash and Investments Held in Trust | 126,951 | 107,072 | |||||
Finance Receivables | 1,739,540 | 1,634,622 | |||||
Allowance for Credit Losses | (269,622 | ) | (252,590 | ) | |||
Finance Receivables, net | 1,469,918 | 1,382,032 | |||||
Dealer Finance Receivables | 74,753 | 40,956 | |||||
Inventory | 228,876 | 270,733 | |||||
Property and Equipment, net | 96,113 | 94,397 | |||||
Other Assets | 57,313 | 67,447 | |||||
Total Assets | $ | 2,079,655 | $ | 1,989,117 | |||
LIABILITIES & SHAREHOLDERS’ EQUITY | |||||||
Liabilities: | |||||||
Accounts Payable | $ | 18,581 | $ | 17,346 | |||
Accrued Expenses and Other Liabilities | 104,829 | 81,121 | |||||
Accrued Expenses—Related Party | 941 | 818 | |||||
Portfolio Term Financings | 989,206 | 1,049,478 | |||||
Portfolio Warehouse Facilities | 145,000 | 57,200 | |||||
Senior Secured Notes Payable | 193,392 | 193,320 | |||||
Senior Secured Notes Payable-Related Party | 5,000 | 5,000 | |||||
Other Secured Notes Payable | 136,668 | 117,281 | |||||
Total Liabilities | 1,593,617 | 1,521,564 | |||||
Shareholders’ Equity—DTAG: | |||||||
Common Stock | — | — | |||||
Paid-in Capital | 117,272 | 147,117 | |||||
Retained Earnings | 7,749 | 8,931 | |||||
Total Shareholders’ Equity—DTAG | 125,021 | 156,048 | |||||
Noncontrolling Interest-DTAC (1) | 361,017 | 311,505 | |||||
Total Equity | 486,038 | 467,553 | |||||
Total Liabilities & Shareholders’ Equity | $ | 2,079,655 | $ | 1,989,117 |
Three Months Ended | |||||||
March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Revenue: | |||||||
Sales of Used Vehicles | $ | 309,468 | $ | 297,135 | |||
Interest Income | 74,974 | 70,528 | |||||
Dealer Finance and Other Income | 2,800 | 175 | |||||
Total Revenue | 387,242 | 367,838 | |||||
Costs and Expenses: | |||||||
Cost of Used Vehicles Sold | 211,638 | 197,161 | |||||
Provision for Credit Losses | 77,842 | 60,342 | |||||
Portfolio Debt Interest Expense | 10,186 | 10,354 | |||||
Non- Portfolio Debt Interest Expense | 1,319 | 1,043 | |||||
Senior Secured Debt Interest Expense | 6,483 | 6,606 | |||||
Senior Secured Debt Interest Expense—Related Party | 158 | — | |||||
Selling and Marketing | 8,917 | 9,470 | |||||
General and Administrative | 43,709 | 41,866 | |||||
General and Administrative—Related Party | 2,651 | 2,858 | |||||
Depreciation Expense | 5,408 | 4,951 | |||||
Total Costs and Expenses | 368,311 | 334,651 | |||||
Income Before Income Taxes | 18,931 | 33,187 | |||||
Income Tax Expense | 342 | 392 | |||||
Net Income | $ | 18,589 | $ | 32,795 | |||
Net Loss Attributable to Noncontrolling Interest—DTAC (1) | $ | (59,749 | ) | $ | (44,904 | ) | |
Net Income Attributable to DTAG | 78,338 | 77,699 | |||||
Net Income | $ | 18,589 | $ | 32,795 |
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Cash Flows from Operating Activities: | |||||||
Net Income | $ | 18,589 | $ | 32,795 | |||
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: | |||||||
Provision for Credit Losses | 77,842 | 60,342 | |||||
Depreciation Expense | 5,408 | 4,951 | |||||
Amortization of Debt Issuance Costs and Debt Premium and Discount | 1,660 | 1,913 | |||||
Non-Cash Compensation Expense—Related Party | 311 | 465 | |||||
Loss (Gain) from Disposal of Property and Equipment | 31 | (60 | ) | ||||
Originations of Finance Receivables | (312,074 | ) | (292,970 | ) | |||
Collections and Recoveries on Finance Receivable Principal Balances | 145,923 | 148,309 | |||||
Change in Accrued Interest Receivable and Loan Origination Costs | 423 | (506 | ) | ||||
Change in Inventory | 41,857 | 80,748 | |||||
Change in Other Assets | 8,829 | 6,042 | |||||
Increase in Accounts Payable, Accrued Expenses and Other Liabilities | 24,530 | 20,476 | |||||
Change in Accrued Expenses-Related Party | 123 | 95 | |||||
Net Cash Provided By Operating Activities | 13,452 | 62,600 | |||||
Cash Flows from Investing Activities: | |||||||
Origination of Dealer Finance Receivables | (38,960 | ) | (5,627 | ) | |||
Collections and Recoveries of Dealer Finance Receivables | 5,163 | 178 | |||||
Proceeds from Disposal of Property and Equipment | 641 | 456 | |||||
Purchase of Property and Equipment | (7,797 | ) | (5,650 | ) | |||
Net Cash Used in Investing Activities | (40,953 | ) | (10,643 | ) | |||
Cash Flows from Financing Activities: | |||||||
Increase in Restricted Cash | (15,624 | ) | (8,499 | ) | |||
Collections, Buybacks and Change in Investments Held in Trust | (4,255 | ) | (1,785 | ) | |||
Additions to Portfolio Term Financings | 75,000 | — | |||||
Repayment of Portfolio Term Financings | (135,207 | ) | (112,289 | ) | |||
Additions to Portfolio Warehouse Facilities | 210,300 | 195,800 | |||||
Repayment of Portfolio Warehouse Facilities | (122,500 | ) | (108,000 | ) | |||
Additions to Other Secured Notes Payable | 20,000 | — | |||||
Repayment of Other Secured Notes Payable | (614 | ) | (14,531 | ) | |||
Payment of Debt Issuance Costs | (348 | ) | (557 | ) | |||
Dividend Distributions | — | (5,260 | ) | ||||
Net Cash Provided by / (Used in) Financing Activities | 26,752 | (55,121 | ) | ||||
Net Decrease in Cash and Cash Equivalents | (749 | ) | (3,164 | ) | |||
Cash and Cash Equivalents at Beginning of Period | 26,480 | 25,930 | |||||
Cash and Cash Equivalents at End of Period | $ | 25,731 | $ | 22,766 | |||
Supplemental Statement of Cash Flows Information: | |||||||
Interest Paid | $ | 11,424 | $ | 11,311 | |||
Interest Paid—Related Party | $ | 158 | $ | — | |||
Income Taxes Paid | $ | 518 | $ | 463 | |||
Supplemental Statement of Non-Cash Investing and Financing Activities: | |||||||
Disposal of Fully Depreciated Property and Equipment | $ | — | $ | 551 |
(1) | Description of Business, Ownership Formation, Basis of Presentation, and Principles of Consolidation |
(2) | Restricted Cash and Investments Held in Trust |
As of March 31, 2013 | As of December 31, 2012 | ||||||
(In thousands) | |||||||
Restricted cash | $ | 38,121 | $ | 22,496 | |||
Investments Held in Trust | 88,830 | 84,576 | |||||
$ | 126,951 | $ | 107,072 |
(3) | Finance Receivables - DriveTime |
As of March 31, 2013 | As of December 31, 2012 | ||||||
(In thousands) | |||||||
Principal Balances | $ | 1,707,051 | $ | 1,601,710 | |||
Accrued Interest | 15,366 | 16,414 | |||||
Loan Origination Costs | 17,123 | 16,498 | |||||
Finance Receivables | $ | 1,739,540 | $ | 1,634,622 |
March 31, 2013 | December 31, 2012 | March 31, 2012 | ||||||||||||||||||
Percent of Portfolio | Loan Principal | Percent of Portfolio | Loan Principal | Percent of Portfolio | Loan Principal | |||||||||||||||
($ In thousands) | ||||||||||||||||||||
Days Delinquent: | ||||||||||||||||||||
Current | 61.4 | % | $ | 1,047,962 | 49.1 | % | $ | 786,765 | 65.8 | % | $ | 1,030,752 | ||||||||
01-30 Days | 28.0 | % | 478,861 | 33.0 | % | 528,300 | 27.4 | % | 429,219 | |||||||||||
31-60 Days | 6.9 | % | 117,721 | 10.0 | % | 161,157 | 4.3 | % | 67,359 | |||||||||||
61-90 Days | 3.2 | % | 54,537 | 5.1 | % | 81,378 | 2.2 | % | 34,463 | |||||||||||
91-120 Days | 0.5 | % | 7,970 | 2.8 | % | 44,110 | 0.3 | % | 4,699 | |||||||||||
Total Past Due | 38.6 | % | $ | 659,089 | 50.9 | % | $ | 814,945 | 34.2 | % | $ | 535,740 | ||||||||
Total Finance Receivables | 100.0 | % | $ | 1,707,051 | 100.0 | % | $ | 1,601,710 | 100.0 | % | $ | 1,566,492 |
Grade | Average FICO Score (1) | Percentage of Portfolio Loans | Total Loans (2) | Percentage of Portfolio Principal | Loan Principal | |||||||
(In thousands) | ||||||||||||
A+ | 555 | 10.3% | 15,019 | 10.5% | $ | 178,406 | ||||||
A | 540 | 18.3% | 26,575 | 18.6% | 317,210 | |||||||
B | 517 | 37.3% | 54,078 | 38.0% | 648,685 | |||||||
C | 504 | 28.8% | 41,790 | 28.3% | 483,127 | |||||||
C- | 489 | 3.8% | 5,546 | 3.3% | 56,882 | |||||||
D+/D/D- | 482 | 1.5% | 2,202 | 1.3% | 22,741 | |||||||
100.0% | 145,210 | 100.0% | $ | 1,707,051 |
Grade | Average FICO Score (1) | Percentage of Portfolio Contracts | Total Loans | Percentage of Portfolio Principal | Loan Principal | |||||||
(In thousands) | ||||||||||||
A+ | 556 | 10.4% | 14,660 | 10.6% | $ | 169,023 | ||||||
A | 539 | 18.5% | 25,998 | 18.8% | 301,173 | |||||||
B | 517 | 37.3% | 52,476 | 38.2% | 612,084 | |||||||
C | 503 | 28.4% | 40,066 | 27.8% | 445,497 | |||||||
C- | 488 | 3.9% | 5,447 | 3.3% | 53,512 | |||||||
D+/D/D- | 478 | 1.5% | 2,101 | 1.3% | 20,421 | |||||||
100.0% | 140,748 | 100.0% | $ | 1,601,710 |
(1) | Average FICO score is provided as an external metric of credit quality. FICO score is not utilized as the primary tool in determining internal credit grade. |
(2) | Excludes Carvana originations |
As of March 31, 2013 | As of December 31, 2012 | |||||||||||||||
State | Percent of Portfolio | Loan Principal (In thousands) | State | Percent of Portfolio | Loan Principal (In thousands) | |||||||||||
Texas | 22.4 | % | $ | 384,359 | Texas | 23.0 | % | $ | 369,021 | |||||||
Florida | 15.2 | % | 261,348 | Florida | 15.4 | % | 247,281 | |||||||||
North Carolina | 9.6 | % | 163,058 | North Carolina | 9.9 | % | 157,670 | |||||||||
Georgia | 7.7 | % | 130,818 | Georgia | 7.6 | % | 122,027 | |||||||||
Virginia | 6.5 | % | 110,887 | Arizona | 6.8 | % | 108,792 | |||||||||
Arizona | 6.4 | % | 108,947 | Virginia | 6.7 | % | 106,749 | |||||||||
Tennessee | 4.9 | % | 83,020 | Tennessee | 4.6 | % | 72,967 | |||||||||
California | 4.4 | % | 75,524 | California | 4.4 | % | 71,005 | |||||||||
Nevada | 3.8 | % | 64,948 | Nevada | 4.0 | % | 63,346 | |||||||||
South Carolina | 3.7 | % | 63,827 | South Carolina | 3.6 | % | 58,163 | |||||||||
Alabama | 3.1 | % | 53,224 | New Mexico | 3.0 | % | 48,421 | |||||||||
New Mexico | 2.9 | % | 48,745 | Alabama | 2.8 | % | 44,787 | |||||||||
Oklahoma | 2.3 | % | 38,703 | Oklahoma | 2.3 | % | 36,109 | |||||||||
Colorado | 2.1 | % | 35,458 | Colorado | 2.2 | % | 35,268 | |||||||||
Ohio | 1.7 | % | 28,409 | Indiana | 1.3 | % | 21,603 | |||||||||
Indiana | 1.4 | % | 24,084 | Ohio | 1.1 | % | 17,417 | |||||||||
Mississippi | 1.1 | % | 19,371 | Mississippi | 1.0 | % | 15,847 | |||||||||
Arkansas | 0.4 | % | 6,252 | Arkansas | 0.2 | % | 3,218 | |||||||||
Missouri | 0.4 | % | 6,069 | Missouri | 0.1 | % | 2,019 | |||||||||
100.0 | % | $ | 1,707,051 | 100.0 | % | $ | 1,601,710 |
Three months ended March 31, | |||||||
2013 | 2012 | ||||||
($ In thousands) | |||||||
Allowance Activity: | |||||||
Balance, beginning of period | $ | 252,590 | $ | 221,533 | |||
Provision for credit losses | 77,842 | 60,342 | |||||
Net charge-offs | (60,810 | ) | (44,848 | ) | |||
Balance, end of period | $ | 269,622 | $ | 237,027 | |||
Allowance as a percent of portfolio principal | 15.7 | % | 15.1 | % | |||
Charge off Activity: | |||||||
Principal balances | $ | (97,917 | ) | $ | (82,851 | ) | |
Recoveries, net | 37,107 | 38,003 | |||||
Net charge-offs | $ | (60,810 | ) | $ | (44,848 | ) |
(4) | Dealer Finance Receivables - GO |
Three months ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Balance, Beginning of Period | $ | 40,956 | $ | 24 | |||
Advances During the Period | 38,960 | 5,502 | |||||
Revenue Recognized | 2,037 | 125 | |||||
Payments to Reduce Amount Advanced | (7,200 | ) | (178 | ) | |||
Balance, End of Period | $ | 74,753 | $ | 5,473 |
Three months ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Balance, Beginning of Period | $ | 8,887 | $ | — | |||
Accretion (Revenue Recognized) | (2,037 | ) | (125 | ) | |||
Additions | 9,999 | 1,792 | |||||
Reclassification from (to) Nonaccretable Yield | — | — | |||||
Balance, End of Period | $ | 16,849 | $ | 1,667 |
As of March 31, 2013 | |||
(In thousands) | |||
Contractual Net Cash Flows (1) | $ | 103,306 | |
Expected Net Cash Flows | (91,602 | ) | |
Non-accretable Yield | $ | 11,704 |
(5) | Debt Obligations |
As of March 31, 2013 | As of December 31, 2012 | ||||||
(In thousands) | |||||||
Securitization Debt: | |||||||
Asset backed security obligations | $ | 569,884 | $ | 677,118 | |||
Bank Term Financing: | |||||||
Variable rate secured financing transactions for our finance receivable portfolio | 319,322 | 347,360 | |||||
Portfolio Term Residual Financing: | |||||||
Variable rate financing facility secured by residual interests in finance receivables of certain warehouse facilities and securitization trusts | 100,000 | 25,000 | |||||
Total Portfolio Term Financings | $ | 989,206 | $ | 1,049,478 |
As of March 31, 2013 | As of December 31, 2012 | |||||||||||||||||||||||||||
Transaction | Debt Balance | Gross Receivables Pledged | Cash Reserve | Interest Rate (1) | Debt Balance | Gross Receivables Pledged | Cash Reserve | Interest Rate (1) | ||||||||||||||||||||
($ In thousands) | ($ In thousands) | |||||||||||||||||||||||||||
2010-1 | $ | 16,037 | $ | 40,958 | $ | 4,500 | 3.6% | $ | 23,036 | $ | 55,525 | $ | 4,500 | 3.6% | ||||||||||||||
2011-1 | 48,398 | 67,170 | 4,200 | 3.0% | 60,335 | 84,198 | 4,200 | 3.0% | ||||||||||||||||||||
2011-2 | 69,436 | 84,419 | 4,500 | 2.9% | 84,977 | 103,779 | 4,500 | 2.9% | ||||||||||||||||||||
2011-3 | 106,570 | 129,943 | 4,500 | 3.9% | 130,347 | 159,068 | 4,500 | 3.9% | ||||||||||||||||||||
2012-1 | 145,443 | 188,752 | 4,500 | 3.5% | 170,198 | 219,252 | 4,500 | 3.5% | ||||||||||||||||||||
2012-2 | 184,000 | 223,914 | 4,500 | 2.9% | 208,225 | 251,409 | 4,500 | 2.9% | ||||||||||||||||||||
$ | 569,884 | $ | 735,156 | $ | 26,700 | $ | 677,118 | $ | 873,231 | $ | 26,700 |
As of March 31, 2013 | |||||||||||||||||||||
Amount Drawn | Facility Amount | Stated Advance Rate | Collateral (1) | Interest Rate (2) | Expiration Date | Final Maturity | |||||||||||||||
($ In thousands) | |||||||||||||||||||||
Portfolio Warehouse Facilities | |||||||||||||||||||||
Deutsche Bank | $ | 48,100 | $ | 150,000 | 65 | % | $ | 111,641 | 2.45 | % | Dec 2014 | Dec 2015 | |||||||||
Wells Fargo | 53,000 | 150,000 | 58 | % | 119,858 | 2.45 | % | Dec 2013 | Dec 2015 | ||||||||||||
RBS | 43,900 | 125,000 | 65 | % | 116,138 | 2.50 | % | Mar 2014 | Mar 2015 | ||||||||||||
Total Portfolio Warehouse Facilities | $ | 145,000 | $ | 425,000 |
As of December 31, 2012 | |||||||||||||||||||||
Amount Drawn | Facility Amount | Stated Advance Rate | Collateral (1) | Interest Rate (2) | Expiration Date | Final Maturity | |||||||||||||||
($ In thousands) | |||||||||||||||||||||
Portfolio Warehouse Facilities | |||||||||||||||||||||
Deutsche Bank | $ | 19,300 | $ | 150,000 | 65 | % | $ | 38,881 | 2.46 | % | Dec 2014 | Dec 2015 | |||||||||
Wells Fargo | 23,000 | 150,000 | 58 | % | 42,778 | 2.46 | % | Dec 2013 | Dec 2015 | ||||||||||||
RBS | 14,900 | 125,000 | 53 | % | 26,707 | 1.65 | % | Mar 2013 | Mar 2014 | ||||||||||||
Total Portfolio Warehouse Facilities | $ | 57,200 | $ | 425,000 |
(1) | Collateral represents underlying pools of finance receivables pledged to each facility. |
(2) | Interest rate at period end equal to contractual benchmark plus index. |
As of March 31, 2013 | As of December 31, 2012 | ||||
(In thousands) | |||||
Senior Secured Notes Payable | 193,392 | 193,320 | |||
Senior Secured Notes Payable - Related Party | 5,000 | 5,000 | |||
Total Senior Secured Notes Payable | 198,392 | 198,320 |
As of March 31, 2013 | |||||||||||||
Balance | Max Facility Capacity | Advance Rate | Interest Rate (1) | Expiration Date | |||||||||
($ In thousands) | |||||||||||||
Other Secured Notes Payable | |||||||||||||
Revolving Inventory Facility | $ | 111,321 | $ | 130,000 | 85% | (2) | 3.75% | Nov 2014 | |||||
Mortgage Note Payable | 12,397 | n/a | n/a | 5.87% | Mar 2017 | ||||||||
Real Estate Facility | 11,269 | 25,000 | 70% | 4.20% | Oct 2020 | ||||||||
Equipment Note Payable | 1,681 | n/a | n/a | 4.75% | Apr 2013 | ||||||||
Total Other Secured Notes Payable | $ | 136,668 | $ | 155,000 | |||||||||
As of December 31, 2012 | |||||||||||||
Balance | Max Facility Capacity | Advance Rate | Interest Rate (1) | Expiration Date | |||||||||
($ In thousands) | |||||||||||||
Other Secured Notes Payable | |||||||||||||
Revolving Inventory Facility | $ | 91,320 | $ | 140,000 | (3) | 85% | (2) | 3.75% | Nov 2014 | ||||
Mortgage Note Payable | 12,454 | n/a | n/a | 5.87% | Mar 2017 | ||||||||
Real Estate Facility | 11,733 | 25,000 | 70% | 4.21% | Oct 2020 | ||||||||
Equipment Note Payable | 1,774 | n/a | n/a | 4.75% | Apr 2013 | ||||||||
Total Other Secured Notes Payable | $ | 117,281 | $ | 165,000 |
(1) | Interest rate at period end equal to contractual benchmark plus index. |
(2) | Advance rate is based on qualifying vehicle cost and is secured by our entire vehicle inventory. |
(3) | Inclusive of a $10.0 million seasonal increase in the months of November through the end of January. |
Three Months Ended March 31, 2013 | |||
(In thousands) | |||
Balance, Beginning of Period | $ | 2,332 | |
Gross Revenue Deferred | 7,037 | ||
Revenue Recognized | (358 | ) | |
Balance, End of Period | $ | 9,011 |
(7) | Related Party Transactions |
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
General and Administrative Expenses—Related Party | |||||||
Property lease expense | $ | 1,198 | $ | 1,220 | |||
Restricted stock compensation expense | 310 | 465 | |||||
Aircraft operating and lease expense | 1,088 | 1,016 | |||||
Salaries and wages, general & administrative and other expenses | 132 | 228 | |||||
Reimbursement of certain general and administrative expenses | (77 | ) | (71 | ) | |||
Total General and Administrative Expenses—Related Party | $ | 2,651 | $ | 2,858 |
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Senior Secured Notes Interest Expense—Related Party | |||||||
Senior Secured Notes Payable—Verde | $ | 142 | $ | — | |||
Senior Secured Notes Payable—CEO | 16 | — | |||||
Total Senior Secured Notes Interest Expense—Related Party | $ | 158 | $ | — |
(8) | Income Taxes |
(9) | Shareholders’ Equity, Dividends & Stock Compensation |
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Warranty Accrual Activity | |||||||
Balance, Beginning of Period | $ | 24,030 | $ | 24,004 | |||
Warranty Expense | 8,556 | 7,441 | |||||
Warranty Claims Paid | (7,678 | ) | (4,009 | ) | |||
Balance, End of Period | $ | 24,908 | $ | 27,436 |
(11) | Fair Value of Financial Instruments |
March 31, 2013 | December 31, 2012 | ||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||
(In thousands) | (In thousands) | ||||||||||||||
Finance Receivables, net (1) | $ | 1,461,336 | $ | 1,550,131 | $ | 1,370,800 | $ | 1,441,026 | |||||||
Dealer Finance Receivables - GO, net | 74,753 | 74,753 | 40,956 | 40,956 | |||||||||||
Securitization Debt | 569,884 | 588,176 | 677,118 | 702,031 | |||||||||||
Portfolio Term Residual Financing | 100,000 | 100,000 | 25,000 | 25,000 | |||||||||||
Bank Term Financings | 319,321 | 319,321 | 347,360 | 347,360 | |||||||||||
Portfolio Warehouse Facilities | 145,000 | 145,000 | 57,200 | 57,200 | |||||||||||
Senior Secured Notes Payable | 198,392 | 222,199 | 198,320 | 220,135 | |||||||||||
Revolving Inventory Facility | 111,321 | 111,662 | 91,320 | 91,600 | |||||||||||
Mortgage Note Payable | 12,397 | 11,149 | 12,454 | 11,200 | |||||||||||
Real Estate Facility | 11,269 | 11,237 | 11,733 | 11,700 |
(1) | Represents finance receivable principal balances, plus accrued interest, less the allowance for credit losses. |
(12) | Subsequent Events |
(13) | Recent Accounting Pronouncements |
(14) | Supplemental Consolidating Financial Information |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non-Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non-Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||||||||||||||||||||||||
Cash and Cash Equivalents | $ | 3,327 | $ | 510 | $ | 5 | $ | — | $ | 3,842 | $ | 52 | $ | 257 | $ | 21,580 | $ | — | $ | 21,889 | $ | — | $ | 25,731 | |||||||||||||||||||||||
Restricted Cash and Investments Held in Trust | — | — | — | — | — | 25,027 | 101,924 | — | — | 126,951 | — | 126,951 | |||||||||||||||||||||||||||||||||||
Finance Receivables | — | — | — | — | — | 279 | — | 1,739,261 | — | 1,739,540 | — | 1,739,540 | |||||||||||||||||||||||||||||||||||
Allowance for Credit Losses | — | — | — | — | — | — | — | (269,622 | ) | — | (269,622 | ) | — | (269,622 | ) | ||||||||||||||||||||||||||||||||
Finance Receivables, Net | — | — | — | — | — | 279 | — | 1,469,639 | — | 1,469,918 | — | 1,469,918 | |||||||||||||||||||||||||||||||||||
Dealer Finance Receivables | — | — | — | — | — | 74,753 | — | — | — | 74,753 | — | 74,753 | |||||||||||||||||||||||||||||||||||
Inventory | 228,876 | — | — | — | 228,876 | — | — | — | — | — | — | 228,876 | |||||||||||||||||||||||||||||||||||
Property and Equipment, Net | 72,924 | — | — | — | 72,924 | 5,457 | 15,211 | 2,521 | — | 23,189 | — | 96,113 | |||||||||||||||||||||||||||||||||||
Investments in Subsidiaries | — | — | 348,577 | (348,577 | ) | — | — | — | 430,410 | (430,410 | ) | — | — | — | |||||||||||||||||||||||||||||||||
Other Assets | 1,428,316 | 26,135 | 480,864 | (706,690 | ) | 1,228,625 | 649,462 | 1,455,383 | 1,129,613 | (2,110,920 | ) | 1,123,538 | (2,294,850 | ) | 57,313 | ||||||||||||||||||||||||||||||||
Total Assets | $ | 1,733,443 | $ | 26,645 | $ | 829,446 | $ | (1,055,267 | ) | $ | 1,534,267 | $ | 755,030 | $ | 1,572,775 | $ | 3,053,763 | $ | (2,541,330 | ) | $ | 2,840,238 | $ | (2,294,850 | ) | $ | 2,079,655 | ||||||||||||||||||||
LIABILITIES & SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||
Accounts Payable | $ | 18,571 | $ | — | $ | — | $ | — | $ | 18,571 | $ | 10 | $ | — | $ | — | $ | — | $ | 10 | $ | — | $ | 18,581 | |||||||||||||||||||||||
Accrued Expenses and Other Liabilities | 1,270,241 | 108 | 605,229 | (706,690 | ) | 1,168,888 | 726,350 | 6,459 | 2,593,550 | (2,094,627 | ) | 1,231,732 | (2,294,850 | ) | 105,770 | ||||||||||||||||||||||||||||||||
Portfolio Term Financings | — | — | — | — | — | — | 1,005,499 | — | (16,293 | ) | 989,206 | — | 989,206 | ||||||||||||||||||||||||||||||||||
Portfolio Warehouse Facilities | — | — | — | — | — | — | 145,000 | — | — | 145,000 | — | 145,000 | |||||||||||||||||||||||||||||||||||
Senior Secured Notes Payable | — | — | 99,196 | — | 99,196 | — | — | 99,196 | — | 99,196 | — | 198,392 | |||||||||||||||||||||||||||||||||||
Other Secured Notes Payable | 111,321 | 11,269 | — | — | 122,590 | 1,681 | 12,397 | — | — | 14,078 | — | 136,668 | |||||||||||||||||||||||||||||||||||
Total Liabilities | 1,400,133 | 11,377 | 704,425 | (706,690 | ) | 1,409,245 | 728,041 | 1,169,355 | 2,692,746 | (2,110,920 | ) | 2,479,222 | (2,294,850 | ) | 1,593,617 | ||||||||||||||||||||||||||||||||
Shareholders’ Equity: | |||||||||||||||||||||||||||||||||||||||||||||||
Total Shareholders’ Equity | 333,309 | 15,268 | 125,021 | (348,577 | ) | 125,021 | 26,989 | 403,421 | 361,017 | (430,410 | ) | 361,017 | — | 486,038 | |||||||||||||||||||||||||||||||||
Total Liabilities & Shareholders’ Equity | $ | 1,733,442 | $ | 26,645 | $ | 829,446 | $ | (1,055,267 | ) | $ | 1,534,266 | $ | 755,030 | $ | 1,572,776 | $ | 3,053,763 | $ | (2,541,330 | ) | $ | 2,840,239 | $ | (2,294,850 | ) | $ | 2,079,655 |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non- Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non- Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
ASSETS | |||||||||||||||||||||||||||||||||||||||||||||||
Cash and Cash Equivalents | $ | 6,937 | $ | 482 | $ | 5 | $ | — | $ | 7,424 | $ | 9 | $ | 423 | $ | 18,624 | $ | — | $ | 19,056 | $ | — | $ | 26,480 | |||||||||||||||||||||||
Restricted Cash and Investments Held in Trust | — | — | — | — | — | 16,163 | 90,909 | — | — | 107,072 | — | 107,072 | |||||||||||||||||||||||||||||||||||
Finance Receivables | — | — | — | — | — | — | — | 1,634,622 | — | 1,634,622 | — | 1,634,622 | |||||||||||||||||||||||||||||||||||
Allowance for Credit Losses | — | — | — | — | — | — | — | (252,590 | ) | — | (252,590 | ) | — | (252,590 | ) | ||||||||||||||||||||||||||||||||
Finance Receivables, Net | — | — | — | — | — | — | — | 1,382,032 | — | 1,382,032 | — | 1,382,032 | |||||||||||||||||||||||||||||||||||
Dealer Finance Receivables | — | — | — | — | — | 40,956 | — | — | — | 40,956 | — | 40,956 | |||||||||||||||||||||||||||||||||||
Inventory | 270,733 | — | — | — | 270,733 | — | — | — | — | — | — | 270,733 | |||||||||||||||||||||||||||||||||||
Property and Equipment, Net | 70,668 | — | — | — | 70,668 | 5,807 | 15,216 | 2,706 | — | 23,729 | — | 94,397 | |||||||||||||||||||||||||||||||||||
Investments in Subsidiaries | — | — | 473,828 | (473,828 | ) | — | — | — | 348,577 | (348,577 | ) | — | — | — | |||||||||||||||||||||||||||||||||
Other Assets | 1,226,409 | 26,480 | 383,689 | (711,814 | ) | 924,764 | 496,384 | 1,352,295 | 887,248 | (1,857,217 | ) | 878,710 | (1,736,027 | ) | 67,447 | ||||||||||||||||||||||||||||||||
Total Assets | $ | 1,574,747 | $ | 26,962 | $ | 857,522 | $ | (1,185,642 | ) | $ | 1,273,589 | $ | 559,319 | $ | 1,458,843 | $ | 2,639,187 | $ | (2,205,794 | ) | $ | 2,451,555 | $ | (1,736,027 | ) | $ | 1,989,117 | ||||||||||||||||||||
LIABILITIES & SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||||||||
Accounts Payable | $ | 17,342 | $ | — | $ | — | $ | — | $ | 17,342 | $ | 4 | $ | — | $ | — | $ | — | $ | 4 | $ | — | $ | 17,346 | |||||||||||||||||||||||
Accrued Expenses and Other Liabilities | 1,006,791 | 695 | 602,314 | (711,814 | ) | 897,986 | 521,476 | 6,703 | 2,228,522 | (1,836,721 | ) | 919,980 | (1,736,027 | ) | 81,939 | ||||||||||||||||||||||||||||||||
Portfolio Term Financings | — | — | — | — | — | — | 1,069,974 | — | (20,496 | ) | 1,049,478 | — | 1,049,478 | ||||||||||||||||||||||||||||||||||
Portfolio Warehouse Facilities | — | — | — | — | — | — | 57,200 | — | — | 57,200 | — | 57,200 | |||||||||||||||||||||||||||||||||||
Senior Secured Notes Payable | — | — | 99,160 | — | 99,160 | — | — | 99,160 | — | 99,160 | — | 198,320 | |||||||||||||||||||||||||||||||||||
Other Secured Notes Payable | 91,320 | 11,733 | — | — | 103,053 | 1,774 | 12,454 | — | — | 14,228 | — | 117,281 | |||||||||||||||||||||||||||||||||||
Total Liabilities | 1,115,453 | 12,428 | 701,474 | (711,814 | ) | 1,117,541 | 523,254 | 1,146,331 | 2,327,682 | (1,857,217 | ) | 2,140,050 | (1,736,027 | ) | 1,521,564 | ||||||||||||||||||||||||||||||||
Shareholders’ Equity: | |||||||||||||||||||||||||||||||||||||||||||||||
Total Shareholders’ Equity | 459,294 | 14,534 | 156,048 | (473,828 | ) | 156,048 | 36,065 | 312,512 | 311,505 | (348,577 | ) | 311,505 | — | 467,553 | |||||||||||||||||||||||||||||||||
Total Liabilities & Shareholders’ Equity | $ | 1,574,747 | $ | 26,962 | $ | 857,522 | $ | (1,185,642 | ) | $ | 1,273,589 | $ | 559,319 | $ | 1,458,843 | $ | 2,639,187 | $ | (2,205,794 | ) | $ | 2,451,555 | $ | (1,736,027 | ) | $ | 1,989,117 |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non-Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non-Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||||||||||||||||||
Sales of Used Vehicles | $ | 309,468 | $ | — | $ | — | $ | — | $ | 309,468 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 309,468 | |||||||||||||||||||||||
Interest Income | — | — | — | — | — | 3 | 73,291 | 75,249 | (73,569 | ) | 74,974 | — | 74,974 | ||||||||||||||||||||||||||||||||||
Dealer Finance and Other Income | — | — | — | — | — | 2,800 | — | — | — | 2,800 | — | 2,800 | |||||||||||||||||||||||||||||||||||
Other Revenue | 12,130 | — | 12,546 | — | 24,676 | 15,980 | — | 523 | (15,994 | ) | 509 | (25,185 | ) | — | |||||||||||||||||||||||||||||||||
Equity in Income of Subsidiaries | — | — | 71,391 | (71,391 | ) | — | — | — | 50,153 | (50,153 | ) | — | — | — | |||||||||||||||||||||||||||||||||
Total Revenue | 321,598 | — | 83,937 | (71,391 | ) | 334,144 | 18,783 | 73,291 | 125,925 | (139,716 | ) | 78,283 | (25,185 | ) | 387,242 | ||||||||||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||
Cost of Used Vehicles Sold | 211,638 | — | — | — | 211,638 | — | — | — | — | — | — | 211,638 | |||||||||||||||||||||||||||||||||||
Provision for Credit Losses | — | — | — | — | — | — | — | 77,842 | — | 77,842 | — | 77,842 | |||||||||||||||||||||||||||||||||||
Portfolio Debt Interest Expense | — | — | — | — | — | — | 10,186 | — | — | 10,186 | — | 10,186 | |||||||||||||||||||||||||||||||||||
Non-Portfolio Debt Interest Expense | 957 | 135 | 13 | — | 1,105 | 20 | 464 | 86,788 | (73,569 | ) | 13,703 | (13,489 | ) | 1,319 | |||||||||||||||||||||||||||||||||
Senior Secured Debt Interest Expense | — | — | 3,321 | — | 3,321 | — | — | 3,320 | — | 3,320 | — | 6,641 | |||||||||||||||||||||||||||||||||||
Selling and Marketing | 8,982 | — | — | — | 8,982 | 14 | — | (79 | ) | — | (65 | ) | — | 8,917 | |||||||||||||||||||||||||||||||||
General and Administrative | 24,837 | (952 | ) | 2,195 | — | 26,080 | 16,558 | 14,125 | 17,287 | (15,994 | ) | 31,976 | (11,696 | ) | 46,360 | ||||||||||||||||||||||||||||||||
Depreciation Expense | 4,527 | — | — | — | 4,527 | 419 | 135 | 327 | — | 881 | — | 5,408 | |||||||||||||||||||||||||||||||||||
Total Costs and Expenses | 250,941 | (817 | ) | 5,529 | — | 255,653 | 17,011 | 24,910 | 185,485 | (89,563 | ) | 137,843 | (25,185 | ) | 368,311 | ||||||||||||||||||||||||||||||||
Income (Loss) before Income Taxes | 70,657 | 817 | 78,408 | (71,391 | ) | 78,491 | 1,772 | 48,381 | (59,560 | ) | (50,153 | ) | (59,560 | ) | — | 18,931 | |||||||||||||||||||||||||||||||
Income Tax Expense | — | 83 | 70 | — | 153 | — | — | 189 | — | 189 | — | 342 | |||||||||||||||||||||||||||||||||||
Net Income (Loss) | $ | 70,657 | $ | 734 | $ | 78,338 | $ | (71,391 | ) | $ | 78,338 | $ | 1,772 | $ | 48,381 | $ | (59,749 | ) | $ | (50,153 | ) | $ | (59,749 | ) | $ | — | $ | 18,589 |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non- Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non- Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||||||||||||||||||
Sales of Used Vehicles | $ | 297,135 | $ | — | $ | — | $ | — | $ | 297,135 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 297,135 | |||||||||||||||||||||||
Interest Income | — | — | — | — | — | — | 63,490 | 70,831 | (63,793 | ) | 70,528 | — | 70,528 | ||||||||||||||||||||||||||||||||||
Dealer Finance and Other Income | — | — | — | — | — | 175 | — | — | — | 175 | — | 175 | |||||||||||||||||||||||||||||||||||
Other Revenue | 11,413 | — | 6,760 | — | 18,173 | 14,525 | — | 569 | (14,504 | ) | 590 | (18,763 | ) | — | |||||||||||||||||||||||||||||||||
Equity in Income of Subsidiaries | — | — | 76,510 | (76,510 | ) | — | — | — | 39,219 | (39,219 | ) | — | — | — | |||||||||||||||||||||||||||||||||
Total Revenue | 308,548 | — | 83,270 | (76,510 | ) | 315,308 | 14,700 | 63,490 | 110,619 | (117,516 | ) | 71,293 | (18,763 | ) | 367,838 | ||||||||||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||
Cost of Used Vehicles Sold | 197,161 | — | — | — | 197,161 | — | — | — | — | — | — | 197,161 | |||||||||||||||||||||||||||||||||||
Provision for Credit Losses | — | — | — | — | — | — | — | 60,342 | — | 60,342 | — | 60,342 | |||||||||||||||||||||||||||||||||||
Portfolio Debt Interest Expense | — | — | — | — | — | — | 10,354 | — | — | 10,354 | — | 10,354 | |||||||||||||||||||||||||||||||||||
Non-Portfolio Debt Interest Expense | 813 | — | 10 | — | 823 | 24 | 494 | 71,894 | (63,793 | ) | 8,619 | (8,399 | ) | 1,043 | |||||||||||||||||||||||||||||||||
Senior Secured Debt Interest Expense | — | — | 3,303 | — | 3,303 | — | — | 3,303 | — | 3,303 | — | 6,606 | |||||||||||||||||||||||||||||||||||
Selling and Marketing | 9,405 | — | — | — | 9,405 | 65 | — | — | — | 65 | — | 9,470 | |||||||||||||||||||||||||||||||||||
General and Administrative | 20,736 | (306 | ) | 2,113 | — | 22,543 | 15,207 | 12,413 | 19,429 | (14,504 | ) | 32,545 | (10,364 | ) | 44,724 | ||||||||||||||||||||||||||||||||
Depreciation Expense | 4,210 | — | — | — | 4,210 | 260 | 154 | 327 | — | 741 | — | 4,951 | |||||||||||||||||||||||||||||||||||
Total Costs and Expenses | 232,325 | (306 | ) | 5,426 | — | 237,445 | 15,556 | 23,415 | 155,295 | (78,297 | ) | 115,969 | (18,763 | ) | 334,651 | ||||||||||||||||||||||||||||||||
Income (Loss) before Income Taxes | 76,223 | 306 | 77,844 | (76,510 | ) | 77,863 | (856 | ) | 40,075 | (44,676 | ) | (39,219 | ) | (44,676 | ) | — | 33,187 | ||||||||||||||||||||||||||||||
Income Tax Expense | — | 56 | 108 | — | 164 | — | — | 228 | — | 228 | — | 392 | |||||||||||||||||||||||||||||||||||
Net Income (Loss) | $ | 76,223 | $ | 250 | $ | 77,736 | $ | (76,510 | ) | $ | 77,699 | $ | (856 | ) | $ | 40,075 | $ | (44,904 | ) | $ | (39,219 | ) | $ | (44,904 | ) | $ | — | $ | 32,795 |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non-Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non-Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
Cash Flows from Operating Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Net Income (Loss) | $ | 70,657 | $ | 734 | $ | 78,338 | $ | (71,391 | ) | $ | 78,338 | $ | 1,772 | $ | 48,381 | $ | (59,749 | ) | $ | (50,153 | ) | $ | (59,749 | ) | $ | — | $ | 18,589 | |||||||||||||||||||
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by (Used In) Operating Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Provision for Credit Losses | — | — | — | — | — | — | — | 77,842 | — | 77,842 | — | 77,842 | |||||||||||||||||||||||||||||||||||
Depreciation Expense | 4,527 | — | — | — | 4,527 | 419 | 135 | 327 | — | 881 | — | 5,408 | |||||||||||||||||||||||||||||||||||
Amortization of Debt Issuance Costs and Debt Premium and Discount | 41 | 15 | 164 | — | 220 | — | 1,276 | 164 | — | 1,440 | — | 1,660 | |||||||||||||||||||||||||||||||||||
Non-Cash Compensation Expense-Related Party | — | — | 155 | — | 155 | — | — | 156 | — | 156 | — | 311 | |||||||||||||||||||||||||||||||||||
Loss (Gain) from Disposal of Property and Equipment | (41 | ) | — | — | — | (41 | ) | 78 | — | (6 | ) | — | 72 | — | 31 | ||||||||||||||||||||||||||||||||
Originations of Finance Receivables | — | — | — | — | — | (285 | ) | — | (311,789 | ) | — | (312,074 | ) | — | (312,074 | ) | |||||||||||||||||||||||||||||||
Collections and Recoveries on Finance Receivable Principal Balances | — | — | — | — | — | 7 | — | 145,916 | — | 145,923 | — | 145,923 | |||||||||||||||||||||||||||||||||||
Change in Accrued Interest Receivable and Loan Origination Costs | — | — | — | — | — | — | — | 423 | — | 423 | — | 423 | |||||||||||||||||||||||||||||||||||
Decrease in Inventory | 41,857 | — | — | — | 41,857 | — | — | — | — | — | — | 41,857 | |||||||||||||||||||||||||||||||||||
(Increase) Decrease in Other Assets | (398,590 | ) | 330 | (81,588 | ) | 66,267 | (413,581 | ) | (163,925 | ) | (61,553 | ) | (214,791 | ) | 303,856 | (136,413 | ) | 558,823 | 8,829 | ||||||||||||||||||||||||||||
Increase (Decrease) in Accounts Payable, Accrued Expenses and Other Liabilities | 264,680 | (588 | ) | 2,931 | 5,124 | 272,147 | 204,879 | (243 | ) | 364,599 | (257,906 | ) | 311,329 | (558,823 | ) | 24,653 | |||||||||||||||||||||||||||||||
Net Cash Provided By (Used In) Operating Activities | (16,869 | ) | 491 | — | — | (16,378 | ) | 42,945 | (12,004 | ) | 3,092 | (4,203 | ) | 29,830 | — | 13,452 | |||||||||||||||||||||||||||||||
Cash Flows from Investing Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Origination of Dealer Finance Receivables | — | — | — | — | — | (38,960 | ) | — | — | — | (38,960 | ) | — | (38,960 | ) | ||||||||||||||||||||||||||||||||
Collections and Recoveries of Dealer Finance Receivables | — | — | — | — | — | 5,163 | — | — | — | 5,163 | — | 5,163 | |||||||||||||||||||||||||||||||||||
Proceeds from Disposal of Property and Equipment | 453 | — | — | — | 453 | 165 | — | 23 | — | 188 | — | 641 | |||||||||||||||||||||||||||||||||||
Purchase of Property and Equipment | (7,194 | ) | — | — | — | (7,194 | ) | (313 | ) | (131 | ) | (159 | ) | — | (603 | ) | — | (7,797 | ) | ||||||||||||||||||||||||||||
Net Cash Used In Investing Activities | (6,741 | ) | — | — | — | (6,741 | ) | (33,945 | ) | (131 | ) | (136 | ) | — | (34,212 | ) | — | (40,953 | ) |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non-Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non-Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
Cash Flows from Financing Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Decrease in Restricted Cash | — | — | — | — | — | (8,864 | ) | (6,760 | ) | — | — | (15,624 | ) | — | (15,624 | ) | |||||||||||||||||||||||||||||||
Collections, Buybacks and Change in Investments Held in Trust | — | — | — | — | — | — | (4,255 | ) | — | — | (4,255 | ) | — | (4,255 | ) | ||||||||||||||||||||||||||||||||
Additions to Portfolio Term Financings | — | — | — | — | — | — | 75,000 | — | — | 75,000 | — | 75,000 | |||||||||||||||||||||||||||||||||||
Repayment of Portfolio Term Financings | — | — | — | — | — | — | (139,410 | ) | — | 4,203 | (135,207 | ) | — | (135,207 | ) | ||||||||||||||||||||||||||||||||
Additions to Portfolio Warehouse Facilities | — | — | — | — | — | — | 210,300 | — | — | 210,300 | — | 210,300 | |||||||||||||||||||||||||||||||||||
Repayment of Portfolio Warehouse Facilities | — | — | — | — | — | — | (122,500 | ) | — | — | (122,500 | ) | — | (122,500 | ) | ||||||||||||||||||||||||||||||||
Additions to Other Secured Notes Payable | 20,000 | — | — | — | 20,000 | — | — | — | — | — | — | 20,000 | |||||||||||||||||||||||||||||||||||
Repayment of Other Secured Notes Payable | — | (463 | ) | — | — | (463 | ) | (93 | ) | (58 | ) | — | — | (151 | ) | — | (614 | ) | |||||||||||||||||||||||||||||
Payment of Debt Issuance Costs | — | — | — | — | — | — | (348 | ) | — | — | (348 | ) | — | (348 | ) | ||||||||||||||||||||||||||||||||
Dividend Distributions | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Net Cash Provided By (Used In) Financing Activities | 20,000 | (463 | ) | — | — | 19,537 | (8,957 | ) | 11,969 | — | 4,203 | 7,215 | — | 26,752 | |||||||||||||||||||||||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | (3,610 | ) | 28 | — | — | (3,582 | ) | 43 | (166 | ) | 2,956 | — | 2,833 | — | (749 | ) | |||||||||||||||||||||||||||||||
Cash and Cash Equivalents at Beginning of Period | 6,937 | 482 | 5 | — | 7,424 | 9 | 423 | 18,624 | — | 19,056 | — | 26,480 | |||||||||||||||||||||||||||||||||||
Cash and Cash Equivalents at End of Period | $ | 3,327 | $ | 510 | $ | 5 | $ | — | $ | 3,842 | $ | 52 | $ | 257 | $ | 21,580 | $ | — | $ | 21,889 | $ | — | $ | 25,731 |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non- Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non- Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
Cash Flows from Operating Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Net Income (Loss) | $ | 76,223 | $ | 250 | $ | 77,736 | $ | (76,510 | ) | $ | 77,699 | $ | (856 | ) | $ | 40,075 | $ | (44,904 | ) | $ | (39,219 | ) | $ | (44,904 | ) | $ | — | $ | 32,795 | ||||||||||||||||||
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by (Used In) Operating Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Provision for Credit Losses | — | — | — | — | — | — | — | 60,342 | — | 60,342 | — | 60,342 | |||||||||||||||||||||||||||||||||||
Depreciation Expense | 4,210 | — | — | — | 4,210 | 260 | 154 | 327 | — | 741 | — | 4,951 | |||||||||||||||||||||||||||||||||||
Amortization of Debt Issuance Costs and Debt Premium and Discount | (9 | ) | — | 147 | — | 138 | — | 1,628 | 147 | — | 1,775 | — | 1,913 | ||||||||||||||||||||||||||||||||||
Non-Cash Compensation Expense-Related Party | — | — | 233 | — | 233 | — | — | 232 | — | 232 | — | 465 | |||||||||||||||||||||||||||||||||||
Loss from Disposal of Property and Equipment | (43 | ) | — | — | — | (43 | ) | (17 | ) | — | — | — | (17 | ) | — | (60 | ) | ||||||||||||||||||||||||||||||
Originations of Finance Receivables | — | — | — | — | — | — | — | (292,970 | ) | — | (292,970 | ) | — | (292,970 | ) | ||||||||||||||||||||||||||||||||
Collections and Recoveries on Finance Receivable Principal Balances | — | — | — | — | — | — | — | 148,309 | — | 148,309 | — | 148,309 | |||||||||||||||||||||||||||||||||||
Decrease in Accrued Interest Receivable and Loan Origination Costs | — | — | — | — | — | — | — | (506 | ) | — | (506 | ) | — | (506 | ) | ||||||||||||||||||||||||||||||||
Decrease in Inventory | 80,748 | — | — | — | 80,748 | — | — | — | — | — | — | 80,748 | |||||||||||||||||||||||||||||||||||
(Increase) Decrease in Other Assets | (392,660 | ) | (860 | ) | (79,037 | ) | 75,599 | (396,958 | ) | (215,975 | ) | 54,673 | (147,096 | ) | 144,296 | (164,102 | ) | 567,102 | 6,042 | ||||||||||||||||||||||||||||
Increase (Decrease) in Accounts Payable, Accrued Expenses and Other Liabilities | 256,446 | 96 | 927 | 911 | 258,380 | 227,018 | (1,467 | ) | 272,488 | (168,746 | ) | 329,293 | (567,102 | ) | 20,571 | ||||||||||||||||||||||||||||||||
Net Cash Provided By (Used In) Operating Activities | 24,915 | (514 | ) | 6 | — | 24,407 | 10,430 | 95,063 | (3,631 | ) | (63,669 | ) | 38,193 | — | 62,600 | ||||||||||||||||||||||||||||||||
Cash Flows from Investing Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Origination of Dealer Finance Receivables | — | — | — | — | — | (5,627 | ) | — | — | — | (5,627 | ) | — | (5,627 | ) | ||||||||||||||||||||||||||||||||
Collections and Receoveries of Dealer Finance Receivables | — | — | — | — | — | 178 | — | — | — | 178 | — | 178 | |||||||||||||||||||||||||||||||||||
Proceeds from Disposal of Property and Equipment | 364 | — | — | — | 364 | 70 | — | 22 | — | 92 | — | 456 | |||||||||||||||||||||||||||||||||||
Purchase of Property and Equipment | (4,587 | ) | — | — | — | (4,587 | ) | (1,419 | ) | 460 | (104 | ) | — | (1,063 | ) | — | (5,650 | ) | |||||||||||||||||||||||||||||
Net Cash Provided By (Used In) Investing Activities | (4,223 | ) | — | — | — | (4,223 | ) | (6,798 | ) | 460 | (82 | ) | — | (6,420 | ) | — | (10,643 | ) |
DriveTime Automotive Group, Inc. | DT Acceptance Corp | ||||||||||||||||||||||||||||||||||||||||||||||
Guarantor Subsidiaries Combined | Non- Guarantor Subsidiary | Parent Company | Eliminations | Consolidated | Guarantor Subsidiaries Combined | Non- Guarantor Subsidiaries Combined | Parent Company | Eliminations | Consolidated | Eliminations | DriveTime Automotive Group, Inc. and Subsidiaries | ||||||||||||||||||||||||||||||||||||
Cash Flows from Financing Activities: | |||||||||||||||||||||||||||||||||||||||||||||||
Decrease in Restricted Cash | — | — | — | — | — | (3,396 | ) | (5,103 | ) | — | — | (8,499 | ) | — | (8,499 | ) | |||||||||||||||||||||||||||||||
Collections, Buybacks and Change in Investments Held in Trust | — | — | — | — | — | — | (1,785 | ) | — | — | (1,785 | ) | — | (1,785 | ) | ||||||||||||||||||||||||||||||||
Additions to Portfolio Warehouse Facilities | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Repayment of Portfolio Warehouse Facilities | — | — | — | — | — | — | (112,289 | ) | — | — | (112,289 | ) | — | (112,289 | ) | ||||||||||||||||||||||||||||||||
Additions to Portfolio Term Financings | — | — | — | — | — | — | 195,800 | — | — | 195,800 | — | 195,800 | |||||||||||||||||||||||||||||||||||
Repayment of Portfolio Term Financings | — | — | — | — | — | — | (108,000 | ) | — | — | (108,000 | ) | — | (108,000 | ) | ||||||||||||||||||||||||||||||||
Additions to Other Secured Notes Payable | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||
Repayment of Other Secured Notes Payable | (14,390 | ) | — | — | — | (14,390 | ) | (89 | ) | (52 | ) | — | — | (141 | ) | — | (14,531 | ) | |||||||||||||||||||||||||||||
Payment of Debt Issuance Costs | (25 | ) | — | (6 | ) | — | (31 | ) | — | (520 | ) | (6 | ) | — | (526 | ) | — | (557 | ) | ||||||||||||||||||||||||||||
Dividend Distributions | — | — | — | — | — | — | (63,669 | ) | (5,260 | ) | 63,669 | (5,260 | ) | — | (5,260 | ) | |||||||||||||||||||||||||||||||
Net Cash Provided By (Used In) Financing Activities | (14,415 | ) | — | (6 | ) | — | (14,421 | ) | (3,485 | ) | (95,618 | ) | (5,266 | ) | 63,669 | (40,700 | ) | — | (55,121 | ) | |||||||||||||||||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | 6,277 | (514 | ) | — | — | 5,763 | 147 | (95 | ) | (8,979 | ) | — | (8,927 | ) | — | (3,164 | ) | ||||||||||||||||||||||||||||||
Cash and Cash Equivalents at Beginning of Period | 2,868 | 595 | 5 | — | 3,468 | 52 | 397 | 22,013 | — | 22,462 | — | 25,930 | |||||||||||||||||||||||||||||||||||
Cash and Cash Equivalents at End of Period | $ | 9,145 | $ | 81 | $ | 5 | $ | — | $ | 9,231 | $ | 199 | $ | 302 | $ | 13,034 | $ | — | $ | 13,535 | $ | — | $ | 22,766 |
(15) | Segment Information |
Three Months Ended | Three Months Ended | ||||||||||||||||||||||
March 31, 2013 | March 31, 2012 | ||||||||||||||||||||||
DriveTime | GO | Total | DriveTime | GO | Total | ||||||||||||||||||
Revenue: | (In thousands) | ||||||||||||||||||||||
Sales of Used Vehicles | $ | 309,468 | $ | — | $ | 309,468 | $ | 297,135 | $ | — | $ | 297,135 | |||||||||||
Interest Income | 74,971 | 3 | 74,974 | 70,528 | — | 70,528 | |||||||||||||||||
Dealer Finance and Other Income | — | 2,800 | 2,800 | — | 175 | 175 | |||||||||||||||||
Total Revenue: | $ | 384,439 | $ | 2,803 | $ | 387,242 | $ | 367,663 | $ | 175 | $ | 367,838 | |||||||||||
Expenses: | |||||||||||||||||||||||
Interest Expense | 18,146 | — | 18,146 | 18,003 | — | 18,003 | |||||||||||||||||
Depreciation Expense | 5,277 | 131 | 5,408 | 4,876 | 75 | 4,951 | |||||||||||||||||
Other Costs and Operating Expenses | 342,853 | 1,904 | 344,757 | 310,466 | 1,231 | 311,697 | |||||||||||||||||
Total Costs and Expenses: | $ | 366,276 | $ | 2,035 | $ | 368,311 | $ | 333,345 | $ | 1,306 | $ | 334,651 | |||||||||||
Income (Loss) Before Income Taxes: | $ | 18,163 | $ | 768 | $ | 18,931 | $ | 34,318 | $ | (1,131 | ) | $ | 33,187 |
March 31, 2013 | December 31, 2012 | ||||||||||||||||||||||
DriveTime | GO | Total | DriveTime | GO | Total | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Assets: | $ | 2,003,189 | $ | 76,466 | $ | 2,079,655 | $ | 1,946,714 | $ | 42,403 | $ | 1,989,117 | |||||||||||
Liabilities: | $ | 1,592,176 | $ | 1,441 | $ | 1,593,617 | $ | 1,520,866 | $ | 698 | $ | 1,521,564 | |||||||||||
Equity: | $ | 411,013 | $ | 75,025 | $ | 486,038 | $ | 425,848 | $ | 41,705 | $ | 467,553 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Three Months Ended | ||||||||||||||||||||||
March 31, 2013 | As of March 31, 2013 | |||||||||||||||||||||
State | # of Units Sold | Percent of Unit Sales Volume | Number of Stores | Number of Reconditioning Facilities | # of Active Loans | Loan Principal | % of Portfolio | |||||||||||||||
(In thousands) | ||||||||||||||||||||||
Texas | 3,899 | 19.9 | % | 18 | 4 | 32,913 | $ | 384,359 | 22.4 | % | ||||||||||||
Florida | 2,859 | 14.6 | % | 18 | 2 | 22,845 | 261,348 | 15.2 | % | |||||||||||||
North Carolina | 1,610 | 8.2 | % | 9 | 1 | 13,800 | 163,058 | 9.6 | % | |||||||||||||
Georgia | 1,545 | 7.8 | % | 7 | 1 | 11,093 | 130,818 | 7.7 | % | |||||||||||||
Arizona | 1,227 | 6.3 | % | 6 | 1 | 10,267 | 108,947 | 6.4 | % | |||||||||||||
Tennessee | 1,151 | 5.9 | % | 5 | 1 | 6,260 | 83,020 | 4.9 | % | |||||||||||||
Virginia | 1,135 | 5.8 | % | 6 | 1 | 10,033 | 110,887 | 6.5 | % | |||||||||||||
Alabama | 859 | 4.4 | % | 5 | 1 | 3,944 | 53,224 | 3.1 | % | |||||||||||||
California | 835 | 4.3 | % | 4 | 1 | 6,718 | 75,524 | 4.4 | % | |||||||||||||
South Carolina | 785 | 4.0 | % | 4 | — | 4,928 | 63,827 | 3.7 | % | |||||||||||||
Ohio | 783 | 4.0 | % | 3 | — | 1,926 | 28,409 | 1.7 | % | |||||||||||||
Nevada | 643 | 3.3 | % | 2 | 1 | 5,830 | 64,948 | 3.8 | % | |||||||||||||
New Mexico | 451 | 2.3 | % | 3 | 1 | 4,657 | 48,745 | 2.9 | % | |||||||||||||
Oklahoma | 438 | 2.2 | % | 3 | — | 2,962 | 38,703 | 2.3 | % | |||||||||||||
Mississippi | 312 | 1.6 | % | 1 | — | 1,354 | 19,371 | 1.1 | % | |||||||||||||
Indiana | 311 | 1.6 | % | 2 | 1 | 1,657 | 24,084 | 1.4 | % | |||||||||||||
Colorado | 311 | 1.6 | % | 2 | 1 | 3,251 | 35,458 | 2.1 | % | |||||||||||||
Missouri | 256 | 1.2 | % | 1 | — | 389 | 6,069 | 0.4 | % | |||||||||||||
Arkansas | 197 | 1.0 | % | 1 | — | 398 | 6,252 | 0.4 | % | |||||||||||||
19,607 | 100.0 | % | 100 | 17 | 145,225 | $ | 1,707,051 | 100.0 | % |
• | Total revenue increased 5.3% to $387.2 million, compared to first quarter 2012. |
• | Unit sales increased 2.4% to 19,607 vehicles sold, compared to first quarter 2012. |
• | Originations increased 6.5% to $312.1 million, compared to first quarter 2012. |
• | GO Financial increased its active dealer base from 191 to 262 dealers and funded $39.0 million in dealer advances. |
• | We opened three new dealerships in two new geographic regions, including Miami and Fort Myers, Florida. |
• | changes to our business plan that are currently being implemented, and those that may be implemented in the future, may not be successful and may cause unintended consequences; |
• | interest rates affect our profitability and cash flows and an increase in interest rates will increase our interest expense and lower our profitability and liquidity; |
• | general, wholesale used vehicle auction prices, and economic conditions and their effect on automobile sales; |
• | seasonal and other fluctuations in our results of operations; |
• | our ability to complete any pending financing transactions. |
As of and for the | |||||||
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
($ In thousands except per vehicle data) | |||||||
Consolidated Statement of Operations Data: | |||||||
Total Revenue | $ | 387,242 | $ | 367,838 | |||
Total Costs and Expenses | $ | 368,311 | $ | 334,651 | |||
Income Before Income Taxes | $ | 18,931 | $ | 33,187 | |||
Net Income | $ | 18,589 | $ | 32,795 | |||
Other Financial Data: | |||||||
EBITDA (1) | $ | 42,485 | $ | 56,141 | |||
Adjusted EBITDA (1) | $ | 48,493 | $ | 56,179 | |||
Dealerships:* | |||||||
Dealerships in operation at end of period | 100 | 90 | |||||
Average number of vehicles sold per dealership per month | 67 | 72 | |||||
Retail Sales:* | |||||||
Number of used vehicles sold | 19,607 | 19,145 | |||||
Average age of vehicles sold (in years) | 5.9 | 5.9 | |||||
Average mileage of vehicles sold | 82,224 | 80,839 | |||||
Per vehicle sold data: | |||||||
Average net revenue per vehicle sold | $ | 15,784 | $ | 15,520 | |||
Average cost of vehicle sold | $ | (10,794 | ) | $ | (10,298 | ) | |
Average gross margin | $ | 4,990 | $ | 5,222 | |||
Gross margin percentage | 31.6 | % | 33.6 | % | |||
Loan Portfolio:* | |||||||
Principal balances originated | $ | 312,074 | $ | 292,970 | |||
Average amount financed per origination | $ | 15,982 | $ | 15,298 | |||
Number of loans outstanding—end of period | 145,225 | 142,627 | |||||
Principal outstanding—end of period | $ | 1,707,051 | $ | 1,566,492 | |||
Average principal outstanding | $ | 1,616,127 | $ | 1,484,085 | |||
Average effective yield on portfolio (2) | 19.1 | % | 19.6 | % | |||
Allowance for credit losses as a percentage of portfolio principal | 15.7 | % | 15.1 | % | |||
Portfolio performance data:* | |||||||
Portfolio delinquencies over 31-90 days | 10.1 | % | 6.5 | % | |||
Principal charged-off as a percentage of outstanding principal (3) | 6.1 | % | 5.6 | % | |||
Recoveries as a percentage of principal charged-off (3) | 37.9 | % | 45.9 | % | |||
Net charge-offs as a percentage of average principal (3) | 3.8 | % | 3.0 | % | |||
Financing and Liquidity:* | |||||||
Unrestricted cash and availability (4) | $ | 177,763 | $ | 224,075 | |||
Ratio of net debt to shareholders’ equity (5) | 2.8x | 2.2x | |||||
Total average debt | $ | 1,440,300 | $ | 1,189,990 | |||
Weighted average effective borrowing rate on total debt (6) | 5.1 | % | 6.1 | % |
March 31, 2013 | December 31, 2012 | ||||||
(In thousands) | |||||||
Consolidated Balance Sheet Data: | |||||||
Cash and Cash Equivalents | $ | 25,731 | $ | 26,480 | |||
DriveTime and GO Finance Receivables (7) | $ | 1,814,293 | $ | 1,675,578 | |||
Allowance for Credit Losses - DriveTime | $ | (269,622 | ) | $ | (252,590 | ) | |
Inventory | $ | 228,876 | $ | 270,733 | |||
Total Assets | $ | 2,079,655 | $ | 1,989,117 | |||
Total Debt (8) | $ | 1,469,266 | $ | 1,422,279 | |||
Shareholders’ Equity | $ | 486,038 | $ | 467,553 |
(1) | See definition of EBITDA and Adjusted EBITDA in Management’s Discussion and Analysis – Non-GAAP discussion |
(2) | Average effective yield represents the interest income earned at the contractual rate (stated APR) less the write-off of accrued interest on charged-off loans and amortization of loan origination costs (which includes the write-off of unamortized loan origination costs on charged-off loans), plus interest earned on investments held in trust and late fees earned. |
(3) | Information is not annualized due to the seasonality of charge-offs and receivables. |
(4) | Unrestricted cash and availability consists of cash and cash equivalents plus available borrowings under the portfolio warehouse, residual, and inventory facilities, based on assets pledged or available to be pledged to the facilities. |
(5) | Net debt is calculated as total debt less restricted cash and investments held in trust securing various debt facilities. Ratio of net debt to shareholders’ equity is calculated as net debt divided by total shareholders’ equity. |
(6) | Weighted average effective borrowing rate includes the effect of amortization of discounts, debt issuance costs, and unused line fees. |
(7) | Includes DriveTime principal balances, accrued interest, and capitalized loan origination costs, and GO carrying value of dealer finance receivables. |
(8) | Total debt excludes accounts payable, accrued expenses, and other liabilities. |
Three Months Ended March 31, 2013 | |||||||
Actual | As Adjusted (1) | ||||||
(In thousands) | |||||||
Balance Sheet Data: | |||||||
Cash and Cash Equivalents | $ | 25,731 | $ | 25,731 | |||
Restricted cash and investments held in trust | $ | 126,951 | $ | 126,951 | |||
Total assets | $ | 2,079,655 | $ | 2,080,892 | |||
Total portfolio debt | $ | 1,134,206 | $ | 1,084,205 | |||
Total debt | $ | 1,469,266 | $ | 1,471,305 | |||
Shareholders' equity | $ | 486,038 | $ | 485,236 | |||
Credit Ratios: | |||||||
Ratio of net debt to shareholders' equity | 2.8x | 2.8x | |||||
Secured Collateral Coverage ratio | 1.9x | 2.3x | |||||
Ratio of Adjusted EBITDA to interest expense | 2.4x | 2.4x |
(1) | Gives effect to (i) the offering of $50 million of senior secured notes in May 2013, as if it occured on March 31, 2013, including the use of proceeds to pay-down warehouse facility and inventory facility debt (ii) additional interest expense that would have been incurred had the $50 million of senior notes been outstanding since January 1, 2013, and (iii) the pledging of the residual interests in SPE's (for collateral coverage ratio) not currently pledged. |
Three Months Ended March 31, | |||||||||
2013 | 2012 | % Change | |||||||
($ in thousands) | |||||||||
Revenue: | |||||||||
Sales of Used Vehicles | $ | 309,468 | $ | 297,135 | 4.2% | ||||
Interest Income | 74,974 | 70,528 | 6.3% | ||||||
Dealer Finance and Other Income | 2,800 | 175 | 1,500.0% | ||||||
Total Revenue | 387,242 | 367,838 | 5.3% | ||||||
Costs and Expenses: | |||||||||
Cost of Used Vehicles Sold | 211,638 | 197,161 | 7.3% | ||||||
Provision for Credit Losses | 77,842 | 60,342 | 29.0% | ||||||
Portfolio Debt Interest Expense | 10,186 | 10,354 | (1.6)% | ||||||
Non-Portfolio Debt Interest Expense | 1,319 | 1,043 | 26.5% | ||||||
Senior Secured Debt Interest Expense | 6,641 | 6,606 | 0.5% | ||||||
Selling and Marketing | 8,917 | 9,470 | (5.8)% | ||||||
General and Administrative | 46,360 | 44,724 | 3.7% | ||||||
Depreciation Expense | 5,408 | 4,951 | 9.2% | ||||||
Total Costs and Expenses | 368,311 | 334,651 | 10.1% | ||||||
Income Before Income Taxes | 18,931 | 33,187 | (43.0)% | ||||||
Income Tax Expense | 342 | 392 | (12.8)% | ||||||
Net Income | $ | 18,589 | $ | 32,795 | (43.3)% |
Three months ended March 31, | |||||||||
2013 | 2012 | % Change | |||||||
($ In thousands) | |||||||||
Net Income | $ | 18,589 | $ | 32,795 | (43.3)% | ||||
GO Financial (Income)/Loss | (768 | ) | 1,131 | (167.9)% | |||||
Carvana (Income)/Loss | 977 | — | 100.0% | ||||||
Change in Deferred Income (1) | 5,356 | — | 100.0% | ||||||
Adjusted Net Income | $ | 24,154 | $ | 33,926 | (28.8)% |
Three Months Ended March 31, | Change | ||||||||||
2013 | 2012 | ||||||||||
($ In thousands except per loan data) | |||||||||||
Amount originated | $ | 312,074 | $ | 292,970 | $ | 19,104 | |||||
Number of loans originated | 19,526 | 19,141 | 385 | ||||||||
Average amount financed per origination | $ | 15,982 | $ | 15,298 | $ | 684 | |||||
Average APR originated | 19.9 | % | 20.4 | % | (0.5 | )% | |||||
Average term (in months) | 63.6 | 57.5 | 6.1 | ||||||||
Average down payment per origination | $ | 1,194 | $ | 1,230 | $ | (36 | ) | ||||
Down payment as a percent of amount financed | 7.5 | % | 8.0 | % | (0.5 | )% | |||||
Percentage of sales revenue financed (1) | 100.8 | % | 98.6 | % | 2.2 | % |
As of and for the | |||||||||||
Three Months Ended March 31, | |||||||||||
2013 | 2012 | Change | |||||||||
($ In thousands except per loan data) | |||||||||||
Average remaining principal per loan, end of period | $ | 11,755 | $ | 10,983 | $ | 772 | |||||
Weighted Average APR of contracts outstanding | 20.3 | % | 20.6 | % | (0.3 | )% | |||||
Average age per loan (in months) | 14.5 | 15.1 | (0.6 | ) | |||||||
Delinquencies: | |||||||||||
Delinquencies 31-60 days | 6.9 | % | 4.3 | % | 2.6 | % | |||||
Delinquencies 61-90 days | 3.2 | % | 2.2 | % | 1.0 | % | |||||
Delinquencies 91-120 days | 0.5 | % | 0.3 | % | 0.2 | % | |||||
Total Delinquencies over 30 days | 10.6 | % | 6.8 | % | 3.8 | % |
Three months ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Revenue: | |||||||
Dealer Finance Income | $ | 2,039 | $ | 124 | |||
Other Income | 764 | 51 | |||||
Total Revenue | $ | 2,803 | $ | 175 | |||
Costs and Expenses: | |||||||
Selling and Marketing | $ | 13 | $ | 65 | |||
General and Administrative | 1,891 | 1,166 | |||||
Depreciation Expense | 131 | 75 | |||||
Total Costs and Expenses | $ | 2,035 | $ | 1,306 | |||
Income (Loss) before Income Taxes | $ | 768 | $ | (1,131 | ) | ||
Income Tax Expense (Benefit) | — | — | |||||
Net Income / (Loss) | $ | 768 | $ | (1,131 | ) |
Three months ended March 31, | |||||||
2013 | 2012 | ||||||
($ In thousands, except per contract information) | |||||||
Originations: | |||||||
Total dealer advance funded | $ | 38,960 | $ | 5,627 | |||
Number of contracts funded | 5,027 | 643 | |||||
Average amount advanced per contract | $ | 7,750 | $ | 8,751 | |||
Average Advance Rate | 73.0 | % | 75.0 | % | |||
Dealers: | |||||||
Number of Funding Dealers | 262 | 53 | |||||
Total Number of Dealers | 377 | 97 | |||||
Number of Active Pools | 318 | 50 | |||||
Number of Closed Pools | 56 | — |
March 31, 2013 | December 31, 2012 | March 31, 2012 | |||||||||
(In thousands) | |||||||||||
Liquidity | |||||||||||
Unrestricted Cash | $ | 25,731 | $ | 26,480 | $ | 22,766 | |||||
Portfolio Warehouse Facilities | 133,353 | 54,185 | 199,893 | ||||||||
Term Residual Facility | — | 9,058 | — | ||||||||
Inventory Facility | 18,679 | 48,679 | 1,416 | ||||||||
Total Liquidity | $ | 177,763 | $ | 138,402 | $ | 224,075 |
Components of Liquidity | Facility Amount | Amount Drawn | Unused Facility Amount | Borrowing Base | Amount Drawn | Total Availability | ||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Deutsche Bank Warehouse Facility | $ | 150,000 | $ | 48,100 | $ | 101,900 | $ | 69,030 | $ | 48,100 | $ | 20,930 | (1) | |||||||||||
Wells Fargo Warehouse Facility | 150,000 | 53,000 | 97,000 | 68,298 | 53,000 | 15,298 | (2) | |||||||||||||||||
RBS Warehouse Facility | 125,000 | 43,900 | 81,100 | 74,920 | 43,900 | 31,020 | (3) | |||||||||||||||||
DTAC Receivables | N/A | N/A | N/A | 36,105 | N/A | 36,105 | (4) | |||||||||||||||||
GO Receivables | N/A | N/A | N/A | 30,000 | N/A | 30,000 | (5) | |||||||||||||||||
Total Portfolio Warehouse Facilities | $ | 425,000 | $ | 145,000 | $ | 280,000 | $ | 278,353 | $ | 145,000 | $ | 133,353 | ||||||||||||
Term Residual Facility | 100,000 | 100,000 | — | 100,000 | 100,000 | — | ||||||||||||||||||
Inventory Facility | 130,000 | 111,321 | 18,679 | 130,000 | 111,321 | 18,679 | ||||||||||||||||||
$ | 655,000 | $ | 356,321 | $ | 298,679 | $ | 508,353 | $ | 356,321 | 152,032 | ||||||||||||||
Unrestricted Cash | 25,731 | |||||||||||||||||||||||
Total Cash and Availability | $ | 177,763 |
(1) | Excludes $3.4 million of warehouse cash collections per borrowing base definition. |
(2) | Excludes $2.9 million of warehouse cash collections per borrowing base definition. |
(3) | Assumes collection and reserve amounts on deposit of $3.3 million are used to paydown amount drawn. |
(4) | Includes $57.9 million of unpledged qualifying receivables that can be pledged immediately and bring total borrowing to our maximum capacity. The borrowing base is the lesser of total eligible collateral multiplied by the applicable advance rate and the facility amount. |
(5) | Includes $86.6 million of unpledged qualifying receivables that can be pledged immediately and bring total borrowing to our maximum capacity. The borrowing base is the lesser of total eligible collateral multiplied by the applicable advance rate and the facility amount. |
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Liquidity, Beginning of Period | $ | 138,402 | $ | 230,267 | |||
Net Decrease in Cash and Cash Equivalents | (749 | ) | (3,164 | ) | |||
Increase in Portfolio Warehouse Availability | 79,168 | 51,056 | |||||
Decrease in Term Residual Facility Availability | (9,058 | ) | — | ||||
(Decrease) in Inventory Facility Availability | (30,000 | ) | (54,084 | ) | |||
Liquidity, End of Period | $ | 177,763 | $ | 224,075 |
As of March 31, 2013 | |||||||||||||||
Guarantor Subsidiaries | Non- Guarantor Subsidiaries | Co-Issuers | Total | ||||||||||||
(In thousands) | |||||||||||||||
Collateral Amounts: | |||||||||||||||
Net Receivables Value (1) | $ | — | $ | 87,569 | $ | 212,378 | $ | 299,947 | |||||||
Net Inventory Value (2) | 73,773 | — | 73,773 | ||||||||||||
Cash Equivalents (3) | — | — | — | — | |||||||||||
Total Collateral Amount | $ | 73,773 | $ | 87,569 | $ | 212,378 | $ | 373,720 | |||||||
12.625% Senior Secured Notes | 200,000 | ||||||||||||||
Collateral Coverage Ratio | 1.9x |
(1) | Receivables Value equals 85% of the finance receivables (including accrued interest and capitalized loan costs) minus debt (exclusive of Senior Secured Notes) collateralized by finance receivables (including accrued interest) plus cash equivalents securing such debt. The Senior Secured Notes are excluded from this calculation. |
(2) | Net Inventory Value equals 85% of the book value of inventory pledged as collateral minus debt obligations (including accrued interest) secured by inventory. The Senior Secured Notes are excluded from this calculation. |
(3) | Cash equivalents equal cash and equivalents pledged directly to secure the Senior Secured Notes. |
• | through fixed rate portfolio term financings, which allowed us to fix a portion of our borrowing costs and generally match the term of the underlying finance receivables, and |
• | by increasing the interest rate charged for loans originated at our dealerships (if allowed under applicable law) while maintaining affordability of the customers’ payment. |
• | cash expenditures for capital expenditures or contractual commitments; |
• | changes in, or cash requirements for, our working capital requirements; |
• | interest expense, or the cash requirements necessary to service interest or principal payments on our indebtedness; |
• | the cost or cash required to replace assets that are being depreciated or amortized; and |
• | the impact on our reported results of earnings or charges resulting from items accounted for in the GAAP measure from which EBITDA and Adjusted EBITDA is derived. |
Three Months Ended March 31, | |||||||
2013 | 2012 | ||||||
(In thousands) | |||||||
Net income: | $ | 18,589 | $ | 32,795 | |||
Plus EBITDA adjustments: | |||||||
Income tax expense | 342 | 392 | |||||
Total interest expense | 18,146 | 18,003 | |||||
Depreciation expense | 5,408 | 4,951 | |||||
EBITDA | 42,485 | 56,141 | |||||
Store closing costs (1) | 59 | 276 | |||||
Sales tax refund adjustments (2) | 283 | (703 | ) | ||||
Restricted stock compensation expense (3) | 310 | 465 | |||||
Deferred income adjustments (4) | 5,356 | — | |||||
Adjusted EBITDA | $ | 48,493 | $ | 56,179 |
(1) | Store closing costs represent ongoing costs to close stores in 2008 and 2009 related to downsizing (and do not include stores closed in the normal course of business). |
(2) | Represents non-cash adjustments to sales tax refunds related to loans charged-off in prior periods. |
(3) | Represents compensation expense related to a restricted stock agreement between the Company and Mr. Fidel. |
(4) | Represents the accounting effect of deferring income related to the sale of separately priced service contracts. |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk |
Item 4. | Controls and Procedures |
PART II. | OTHER INFORMATION |
Item 1. | Legal Proceedings |
Item 1A. | Risk Factors |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Item 3. | Defaults Upon Senior Securities |
Item 4. | Mine Safety Disclosures |
Item 5. | Other Information |
Item 6. | Exhibits |
Exhibit # | Description of Document | |
3.1.1 | Amended and Restated Certificate of Incorporation of Ugly Duckling Corporation (former name of DriveTime Automotive Group, Inc.) (incorporated by reference to Exhibit 3.1.1 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.1.2.1 | Articles of Incorporation of DriveTime Acceptance Corporation (former name of DT Acceptance Corporation) (incorporated by reference to Exhibit 3.1.2.1 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.1.2.2 | Articles of Amendment to the Articles of Incorporation of DriveTime Acceptance Corporation (former name of DT Acceptance Corporation) (incorporated by reference to Exhibit 3.1.2.2 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.1.3 | Articles of Organization of DriveTime Car Sales Company, LLC (incorporated by reference to Exhibit 3.1.3 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.1.4 | Articles of Organization of DriveTime Sales and Finance Company, LLC (incorporated by reference to Exhibit 3.1.4 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.1.5 | Articles of Organization of DT Credit Company, LLC (incorporated by reference to Exhibit 3.1.5 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.1.6 | Articles of Organization of DT Jet Leasing, LLC (incorporated by reference to Exhibit 3.1.6 to our Registration Statement on Form S- 4/A filed on October 19, 2010) | |
3.2.1 | By-laws of Ugly Duckling Corporation (former name of DriveTime Automotive Group, Inc.) (incorporated by reference to Exhibit 3.2.1 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.2.2 | Bylaws of DriveTime Acceptance Corporation (former name of DT Acceptance Corporation) (incorporated by reference to Exhibit 3.2.2 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.2.3 | Operating Agreement of DriveTime Car Sales Company, LLC (incorporated by reference to Exhibit 3.2.3 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.2.4 | Operating Agreement of DriveTime Sales and Finance Company, LLC (incorporated by reference to Exhibit 3.2.4 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.2.5 | Operating Agreement of DT Credit Company, LLC (incorporated by reference to Exhibit 3.2.5 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
3.2.6 | Operating Agreement of DT Jet Leasing, LLC (incorporated by reference to Exhibit 3.2.6 to our Registration Statement on Form S- 4/A filed on October 19, 2010) | |
4.1.1 | Indenture governing 12.625% Senior Secured Notes due 2017, including the form of 12.625% Senior Secured Notes due 2017, among DriveTime Automotive Group, Inc., DT Acceptance Corporation, DriveTime Car Sales Company, LLC, DriveTime Sales and Finance Company, LLC, DT Credit Company, LLC, DT Jet Leasing, LLC and Wells Fargo Bank, National Association, dated as of June 4, 2010 (incorporated by reference to Exhibit 3.1.1 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
4.1.2 | First Supplemental Indenture governing 12.625% Senior Secured Notes due 2017, dated as of September 20, 2010, among DriveTime Automotive Group, Inc., DT Acceptance Corporation, Approval Services Company, LLC and Wells Fargo Bank, National Association, as Trustee. (incorporated by reference to Exhibit 4.1.2 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
4.1.3 | Second Supplemental Indenture, dated as of August 16, 2011, by and among DriveTime Automotive Group, Inc., DT Acceptance Corporation, Wells Fargo Bank, National Association and Go Financial Company LLC (incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed on August 22, 2011) | |
4.1.4 | Third Supplemental Indenture, dated as of October 6, 2011, by and among DriveTime Automotive Group, Inc., DT Acceptance Corporation, Wells Fargo Bank, National Association and DriveTime Ohio Company, LLC (incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed on October 13, 2011) | |
4.1.5 | Fourth Supplemental Indenture, dated as of March 30, 2012, by and among DriveTime Automotive Group, Inc., DT Acceptance Corporation, Wells Fargo Bank, National Association, as Trustee and Collateral Agent and Carvana, LLC (incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed on April 5, 2012) | |
Exhibit # | Description of Document | |
4.2.1 | Security Agreement dated as of June 4, 2010, among DT Acceptance Corporation, DriveTime Automotive Group, Inc., DriveTime Car Sales Company, LLC, and Wells Fargo Bank, National Association. (incorporated by reference to Exhibit 4.1.3 to our Registration Statement on Form S-4/A filed on February 2, 2011)† | |
4.2.2 | Supplement No. 1 dated as of October 28, 2011 to the Security Agreement dated as of June 4, 2010, among DriveTime Automotive Group, Inc., DT Acceptance Corporation, DriveTime Car Sales Company, LLC, and Wells Fargo Bank, National Association or the Secured Parties (incorporated by reference to Exhibit 4.1 to our Current Report on Form 8-K filed on November 3, 2011) | |
4.2.3 | Supplement No. 2, dated as of March 30, 2012 to the Security Agreement dated as of June 4, 2010, among DriveTime Automotive Group, Inc., DT Acceptance Corporation, DriveTime Car Sales Company, LLC and Wells Fargo Bank, National Association, as collateral agent for the Secured Parties (incorporated by reference to Exhibit 4.2 to our Current Report on Form 8-K filed on April 5, 2012) | |
4.3 | Pledge Agreement dated as of June 4, 2010, between DT Acceptance Corporation and Wells Fargo Bank, National Association. (incorporated by reference to Exhibit 4.1.4 to our Registration Statement on Form S-4/A filed on February 2, 2011)† | |
4.4 | Pledge Letter dated as of August 2, 2010, amending the Pledge Agreement dated as of June 4, 2010. (incorporated by reference to Exhibit 4.1.5 to our Registration Statement on Form S-4/A filed on February 2, 2011) | |
4.5 | Intercreditor Agreement, dated as of June 4, 2010, among Santander Consumer USA Inc. and Manheim Automotive Financial Services, Inc., Wells Fargo Bank, National Association, and as Trustee for the Holders (as defined therein), DriveTime Automotive Group, Inc., DriveTime Sales and Finance Company, LLC, DriveTime Car Sales Company, LLC, and DT Acceptance Corporation, and each of the other Loan Parties party thereto. (incorporated by reference to Exhibit 4.1.6 to our Registration Statement on Form S-4/A filed on February 2, 2011) | |
4.6 | Registration Rights Agreement, dated June 4, 2010, among DriveTime Automotive Group, Inc., DT Acceptance Corporation, DriveTime Car Sales Company, LLC, DriveTime Sales and Finance Company, LLC, DT Credit Company, LLC, DT Jet Leasing, LLC, Jefferies & Company, Inc., RBS Securities Inc. and UBS Securities LLC (incorporated by reference to Exhibit 4.2 to our Registration Statement on Form S-4/A filed on October 19, 2010) | |
4.7 | Registration Rights Agreement, dated June 6, 2011, by and among DT Acceptance Corporation, DriveTime Automotive Group, Inc., DriveTime Sales and Finance Company, LLC, DriveTime Car Sales Company, LLC, DT Credit Company, LLC, DT Jet Leasing, LLC, Approval Services Company, LLC and RBS Securities Inc. (incorporated by reference to Exhibit 10.1 to our Form 8-K filed on June 10, 2011) | |
4.8 | Registration Rights Agreement, dated May 2, 2013, by and among DriveTime Automotive Group, Inc., DT Acceptance Corporation, the subsidiary guarantors named therein and the Initial Purchases set forth on Schedule I thereto. (incorporated by reference to Exhibit 4.1 to our Form 8-K filed on May 8, 2013) | |
10.1 | Amendment No. 1, dated February 14, 2013, to the Amended and Restated Loan and Servicing Agreement, dated December 31, 2012, by and among DT Warehouse II, LLC, DT Credit Company, LLC, Wells Fargo Bank, National Association and Santander Consumer USA Inc.* | |
10.2 | Amendment No. 2, dated March 15, 2013, to the Loan and Security Agreement, dated December 23, 2011, by and among DT Warehouse V, LLC, DT Credit Company, LLC, Wells Fargo Bank, National Association, Wells Fargo Securities, LLC and Wells Fargo Bank, National Association* | |
10.3 | Amendment No. 5, dated March 13, 2013, to the Loan and Servicing Agreement, dated July 23, 2010, by and among DT Warehouse IV, LLC, DT Credit Company, LLC, Wells Fargo Bank, National Association, the Commercial Paper Conduits from time to time party thereto, the Financial Institutions from time to time party thereto, and The Royal Bank of Scotland plc.* | |
10.4 | Amendment No. 6, dated March 26, 2013, to the Loan and Servicing Agreement, dated July 23, 2010, by and among DT Warehouse IV, LLC, DT Credit Company, LLC, Wells Fargo Bank, National Association, the Commercial Paper Conduits from time to time party thereto, the Financial Institutions from time to time party thereto, and The Royal Bank of Scotland plc.* | |
10.5 | Amendment No. 7, dated April 2, 2013, to Loan and Servicing Agreement, dated July 23, 2010, by and among DT Warehouse IV, DT Credit Company, Wells Fargo Bank, National Association, The Royal Bank of Scotland plc, and other parties named therein.* | |
10.6 | Purchase Agreement, dated April 25, 2013, by and among DriveTime Automotive Group, Inc., DT Acceptance Corporation, the subsidiary guarantors named therein and the Initial Purchases set forth on Schedule I thereto. (incorporated by reference to Exhibit 10.1 to our Form 8-K filed on April 30, 2013) | |
Exhibit # | Description of Document | |
31.1 | Certification of Chief Executive Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
31.2 | Certification of Chief Financial Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
32.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | |
101.INS | XBRL Instance Document** | |
101.SCH | XBRL Taxonomy Extension Schema Document** | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document** | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document** | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document** | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document** |
* | Filed herewith. |
** | Furnished herewith. |
† | Portions of this exhibit have been omitted and filed separately with the Securities and Exchange Commission in accordance with an order granting confidential treatment pursuant to the Securities Exchange Act of 1934, as amended. |
DRIVETIME AUTOMOTIVE GROUP, INC. | ||||
Date: May 10, 2013 | By: | /s/ Mark G. Sauder | ||
Name: Mark G. Sauder | ||||
Title: Chief Financial Officer & Executive VP | ||||
DT ACCEPTANCE CORPORATION | ||||
Date: May 10, 2013 | By: | /s/ Mark G. Sauder | ||
Name: Mark G. Sauder | ||||
Title: Chief Financial Officer & Executive VP |
By: | /s/ Jon Ehlinger |
By: | /s/ Jon Ehlinger |
By: | /s/ Steven J. Ellis |
By: | /s/ Jeanine C. Casey |
By: | /s/ Leah W. Miller |
1. | I have reviewed this quarterly report on Form 10-Q of DriveTime Automotive Group, Inc. and DT Acceptance Corporation (collectively, the “registrant”). | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report. | |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have: | |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; | |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and | |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): | |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Dated: May 10, 2013 | By: | /s/ Raymond C. Fidel |
Raymond C. Fidel Chief Executive Officer and President (Principal Executive Officer) | ||
1. | I have reviewed this quarterly report on Form 10-Q of DriveTime Automotive Group, Inc. and DT Acceptance Corporation (collectively, the “registrant”). | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report. | |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have: | |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; | |
d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and | |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function): | |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and | |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: May 10, 2013 | By: | /s/ Mark G. Sauder |
Mark G. Sauder Chief Financial Officer and Executive VP (Principal Financial Officer) |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of DriveTime Automotive Group, Inc. and DT Acceptance Corporation. |
Dated: May 10, 2013 | By: | /s/ Raymond C. Fidel |
Raymond C. Fidel Chief Executive Officer and President (Principal Executive Officer) | ||
Dated: May 10, 2013 | By: | /s/ Mark G. Sauder |
Mark G. Sauder Chief Financial Officer and Executive VP (Principal Financial Officer) |
Dealer Finance Receivables accretable yield (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
|
|
Accretable Yield [Roll Forward] | ||
Balance, Beginning of Period | $ 8,887 | $ 0 |
Accretion (Revenue Recognized) | (2,037) | (125) |
Additions | 9,999 | 1,792 |
Reclassification from (to) Nonaccretable Yield | 0 | 0 |
Balance, End of Period | $ 16,849 | $ 1,667 |
Related Party Transactions Related Party Operating Expenses (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
|
|
Related Party Transaction [Line Items] | ||
General and Administrative—Related Party | $ 2,651 | $ 2,858 |
Property lease expense [Member]
|
||
Related Party Transaction [Line Items] | ||
General and Administrative—Related Party | 1,198 | 1,220 |
Restricted stock compensation expense [Member]
|
||
Related Party Transaction [Line Items] | ||
General and Administrative—Related Party | 310 | 465 |
Aircraft Operating and Lease Expense [Member]
|
||
Related Party Transaction [Line Items] | ||
General and Administrative—Related Party | 1,088 | 1,016 |
Salaries and wages, general & administrative and other expenses
|
||
Related Party Transaction [Line Items] | ||
General and Administrative—Related Party | 132 | 228 |
Reimbursement of certain general and administrative expenses
|
||
Related Party Transaction [Line Items] | ||
General and Administrative—Related Party | $ (77) | $ (71) |
Subsequent Events (Details) (USD $)
|
1 Months Ended | ||
---|---|---|---|
Apr. 30, 2013
Subsequent Event [Member]
|
Jun. 30, 2010
Senior Notes [Member]
|
May 31, 2013
Senior Notes [Member]
Subsequent Event [Member]
|
|
Subsequent Event [Line Items] | |||
Payments of cash dividends | $ 10,900,000 | ||
Senior secured notes issued | $ 200,000,000.0 | $ 50,000,000.0 | |
Senior notes issuance price as percent of face amount | 98.854% | 111.00% | |
Senior notes issued, effective yield percentage | 12.875% | 7.67% |
Debt Obligations Other Secured Notes Payable (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Mar. 31, 2013
Revolving Inventory Facility [Member]
|
Dec. 31, 2012
Revolving Inventory Facility [Member]
|
Mar. 31, 2013
Mortgage Note Payable [Member]
|
Dec. 31, 2012
Mortgage Note Payable [Member]
|
Mar. 31, 2013
Real Estate Credit Facility [Member]
|
Dec. 31, 2012
Real Estate Credit Facility [Member]
|
Mar. 31, 2013
Equipment Note Payable [Member]
|
Dec. 31, 2012
Equipment Note Payable [Member]
|
Mar. 31, 2013
LIBOR [Member]
Revolving Inventory Facility [Member]
|
Mar. 31, 2013
LIBOR [Member]
Real Estate Credit Facility [Member]
|
Mar. 31, 2013
Prime Rate [Member]
Equipment Note Payable [Member]
|
Dec. 31, 2012
Seasonal Increase [Member]
Revolving Inventory Facility [Member]
|
Apr. 30, 2013
Subsequent Event [Member]
Prime Rate [Member]
Equipment Note Payable [Member]
|
||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||
Balance | $ 136,668 | $ 117,281 | $ 111,321 | $ 91,320 | $ 12,397 | $ 12,454 | $ 11,269 | $ 11,733 | $ 1,681 | $ 1,774 | $ 10,000 | ||||||||||||||||||
Max Facility Capacity | 425,000 | 425,000 | 130,000 | 140,000 | [1] | 25,000 | 25,000 | ||||||||||||||||||||||
Stated Advance Rate | 85.00% | [2] | 85.00% | [2] | 70.00% | 70.00% | |||||||||||||||||||||||
Interest Rate | 3.75% | [3] | 3.75% | [3] | 5.87% | [3] | 5.87% | [3] | 4.20% | [3] | 4.21% | [3] | 4.75% | [3] | 4.75% | [3] | |||||||||||||
Total Other Secured Notes Payable | $ 155,000 | $ 165,000 | |||||||||||||||||||||||||||
Basis spread on variable interest rate | 3.50% | 4.00% | 1.50% | 1.00% | |||||||||||||||||||||||||
|
Finance Receivables Summary of Finance Receivables (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Mar. 31, 2012
|
---|---|---|---|
Receivables [Abstract] | |||
Principal Balances | $ 1,707,051 | $ 1,601,710 | $ 1,566,492 |
Accrued Interest | 15,366 | 16,414 | |
Loan Origination Costs | 17,123 | 16,498 | |
Finance Receivables | $ 1,739,540 | $ 1,634,622 |
Supplemental Consolidating Financial Information Supplemental Consolidating Balance Sheets (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
Mar. 31, 2012
|
Dec. 31, 2011
|
---|---|---|---|---|
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | $ 25,731 | $ 26,480 | $ 22,766 | $ 25,930 |
Restricted Cash and Investments Held in Trust | 126,951 | 107,072 | ||
Finance Receivables | 1,739,540 | 1,634,622 | ||
Allowance for Credit Losses | (269,622) | (252,590) | (237,027) | (221,533) |
Finance Receivables, net | 1,469,918 | 1,382,032 | ||
Dealer Finance Receivables | 74,753 | 40,956 | 5,473 | 24 |
Inventory | 228,876 | 270,733 | ||
Property and Equipment, net | 96,113 | 94,397 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 57,313 | 67,447 | ||
Total Assets | 2,079,655 | 1,989,117 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 18,581 | 17,346 | ||
Accrued Expenses and Other Liabilities | 105,770 | 81,939 | ||
Portfolio Term Financings | 989,206 | 1,049,478 | ||
Portfolio Warehouse Facilities | 145,000 | 57,200 | ||
Senior Notes, Including Related Party Portion | 198,392 | 198,320 | ||
Other Secured Notes Payable | 136,668 | 117,281 | ||
Total Liabilities | 1,593,617 | 1,521,564 | ||
Total Shareholders' Equity | 486,038 | 467,553 | ||
Total Liabilities & Shareholders’ Equity | 2,079,655 | 1,989,117 | ||
Eliminations [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 0 | 0 | 0 | 0 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 0 | 0 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | (2,294,850) | (1,736,027) | ||
Total Assets | (2,294,850) | (1,736,027) | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | (2,294,850) | (1,736,027) | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 0 | 0 | ||
Total Liabilities | (2,294,850) | (1,736,027) | ||
Total Shareholders' Equity | 0 | 0 | ||
Total Liabilities & Shareholders’ Equity | (2,294,850) | (1,736,027) | ||
Drive Time Automotive Group, Inc. [Member] | Guarantor Subsidiaries Combined [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 3,327 | 6,937 | 9,145 | 2,868 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 228,876 | 270,733 | ||
Property and Equipment, net | 72,924 | 70,668 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 1,428,316 | 1,226,409 | ||
Total Assets | 1,733,443 | 1,574,747 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 18,571 | 17,342 | ||
Accrued Expenses and Other Liabilities | 1,270,241 | 1,006,791 | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 111,321 | 91,320 | ||
Total Liabilities | 1,400,133 | 1,115,453 | ||
Total Shareholders' Equity | 333,309 | 459,294 | ||
Total Liabilities & Shareholders’ Equity | 1,733,442 | 1,574,747 | ||
Drive Time Automotive Group, Inc. [Member] | Non-Guarantor Subsidiaries [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 510 | 482 | 81 | 595 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 0 | 0 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 26,135 | 26,480 | ||
Total Assets | 26,645 | 26,962 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | 108 | 695 | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 11,269 | 11,733 | ||
Total Liabilities | 11,377 | 12,428 | ||
Total Shareholders' Equity | 15,268 | 14,534 | ||
Total Liabilities & Shareholders’ Equity | 26,645 | 26,962 | ||
Drive Time Automotive Group, Inc. [Member] | Parent Company [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 5 | 5 | 5 | 5 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 0 | 0 | ||
Investments in Subsidiaries | 348,577 | 473,828 | ||
Other Assets | 480,864 | 383,689 | ||
Total Assets | 829,446 | 857,522 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | 605,229 | 602,314 | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 99,196 | 99,160 | ||
Other Secured Notes Payable | 0 | 0 | ||
Total Liabilities | 704,425 | 701,474 | ||
Total Shareholders' Equity | 125,021 | 156,048 | ||
Total Liabilities & Shareholders’ Equity | 829,446 | 857,522 | ||
Drive Time Automotive Group, Inc. [Member] | Eliminations [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 0 | 0 | 0 | 0 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 0 | 0 | ||
Investments in Subsidiaries | (348,577) | (473,828) | ||
Other Assets | (706,690) | (711,814) | ||
Total Assets | (1,055,267) | (1,185,642) | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | (706,690) | (711,814) | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 0 | 0 | ||
Total Liabilities | (706,690) | (711,814) | ||
Total Shareholders' Equity | (348,577) | (473,828) | ||
Total Liabilities & Shareholders’ Equity | (1,055,267) | (1,185,642) | ||
Drive Time Automotive Group, Inc. [Member] | Consolidated [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 3,842 | 7,424 | 9,231 | 3,468 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 228,876 | 270,733 | ||
Property and Equipment, net | 72,924 | 70,668 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 1,228,625 | 924,764 | ||
Total Assets | 1,534,267 | 1,273,589 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 18,571 | 17,342 | ||
Accrued Expenses and Other Liabilities | 1,168,888 | 897,986 | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 99,196 | 99,160 | ||
Other Secured Notes Payable | 122,590 | 103,053 | ||
Total Liabilities | 1,409,245 | 1,117,541 | ||
Total Shareholders' Equity | 125,021 | 156,048 | ||
Total Liabilities & Shareholders’ Equity | 1,534,266 | 1,273,589 | ||
DT Acceptance Corp [Member] | Guarantor Subsidiaries Combined [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 52 | 9 | 199 | 52 |
Restricted Cash and Investments Held in Trust | 25,027 | 16,163 | ||
Finance Receivables | 279 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 279 | 0 | ||
Dealer Finance Receivables | 74,753 | 40,956 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 5,457 | 5,807 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 649,462 | 496,384 | ||
Total Assets | 755,030 | 559,319 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 10 | 4 | ||
Accrued Expenses and Other Liabilities | 726,350 | 521,476 | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 1,681 | 1,774 | ||
Total Liabilities | 728,041 | 523,254 | ||
Total Shareholders' Equity | 26,989 | 36,065 | ||
Total Liabilities & Shareholders’ Equity | 755,030 | 559,319 | ||
DT Acceptance Corp [Member] | Non-Guarantor Subsidiaries [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 257 | 423 | 302 | 397 |
Restricted Cash and Investments Held in Trust | 101,924 | 90,909 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 15,211 | 15,216 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 1,455,383 | 1,352,295 | ||
Total Assets | 1,572,775 | 1,458,843 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | 6,459 | 6,703 | ||
Portfolio Term Financings | 1,005,499 | 1,069,974 | ||
Portfolio Warehouse Facilities | 145,000 | 57,200 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 12,397 | 12,454 | ||
Total Liabilities | 1,169,355 | 1,146,331 | ||
Total Shareholders' Equity | 403,421 | 312,512 | ||
Total Liabilities & Shareholders’ Equity | 1,572,776 | 1,458,843 | ||
DT Acceptance Corp [Member] | Parent Company [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 21,580 | 18,624 | 13,034 | 22,013 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 1,739,261 | 1,634,622 | ||
Allowance for Credit Losses | (269,622) | (252,590) | ||
Finance Receivables, net | 1,469,639 | 1,382,032 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 2,521 | 2,706 | ||
Investments in Subsidiaries | 430,410 | 348,577 | ||
Other Assets | 1,129,613 | 887,248 | ||
Total Assets | 3,053,763 | 2,639,187 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | 2,593,550 | 2,228,522 | ||
Portfolio Term Financings | 0 | 0 | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 99,196 | 99,160 | ||
Other Secured Notes Payable | 0 | 0 | ||
Total Liabilities | 2,692,746 | 2,327,682 | ||
Total Shareholders' Equity | 361,017 | 311,505 | ||
Total Liabilities & Shareholders’ Equity | 3,053,763 | 2,639,187 | ||
DT Acceptance Corp [Member] | Eliminations [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 0 | 0 | 0 | 0 |
Restricted Cash and Investments Held in Trust | 0 | 0 | ||
Finance Receivables | 0 | 0 | ||
Allowance for Credit Losses | 0 | 0 | ||
Finance Receivables, net | 0 | 0 | ||
Dealer Finance Receivables | 0 | 0 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 0 | 0 | ||
Investments in Subsidiaries | (430,410) | (348,577) | ||
Other Assets | (2,110,920) | (1,857,217) | ||
Total Assets | (2,541,330) | (2,205,794) | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 0 | 0 | ||
Accrued Expenses and Other Liabilities | (2,094,627) | (1,836,721) | ||
Portfolio Term Financings | (16,293) | (20,496) | ||
Portfolio Warehouse Facilities | 0 | 0 | ||
Senior Notes, Including Related Party Portion | 0 | 0 | ||
Other Secured Notes Payable | 0 | 0 | ||
Total Liabilities | (2,110,920) | (1,857,217) | ||
Total Shareholders' Equity | (430,410) | (348,577) | ||
Total Liabilities & Shareholders’ Equity | (2,541,330) | (2,205,794) | ||
DT Acceptance Corp [Member] | Consolidated [Member]
|
||||
ASSETS [Abstract] | ||||
Cash and Cash Equivalents | 21,889 | 19,056 | 13,535 | 22,462 |
Restricted Cash and Investments Held in Trust | 126,951 | 107,072 | ||
Finance Receivables | 1,739,540 | 1,634,622 | ||
Allowance for Credit Losses | (269,622) | (252,590) | ||
Finance Receivables, net | 1,469,918 | 1,382,032 | ||
Dealer Finance Receivables | 74,753 | 40,956 | ||
Inventory | 0 | 0 | ||
Property and Equipment, net | 23,189 | 23,729 | ||
Investments in Subsidiaries | 0 | 0 | ||
Other Assets | 1,123,538 | 878,710 | ||
Total Assets | 2,840,238 | 2,451,555 | ||
LIABILITIES & SHAREHOLDERS’ EQUITY | ||||
Accounts Payable | 10 | 4 | ||
Accrued Expenses and Other Liabilities | 1,231,732 | 919,980 | ||
Portfolio Term Financings | 989,206 | 1,049,478 | ||
Portfolio Warehouse Facilities | 145,000 | 57,200 | ||
Senior Notes, Including Related Party Portion | 99,196 | 99,160 | ||
Other Secured Notes Payable | 14,078 | 14,228 | ||
Total Liabilities | 2,479,222 | 2,140,050 | ||
Total Shareholders' Equity | 361,017 | 311,505 | ||
Total Liabilities & Shareholders’ Equity | $ 2,840,239 | $ 2,451,555 |
Deferred Revenue (Tables)
|
3 Months Ended | ||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2013
|
|||||||||||||||||||||||||||||||||
Deferred Revenue Disclosure [Abstract] | |||||||||||||||||||||||||||||||||
Deferred Revenue, by Arrangement, Disclosure | The following table sets forth information regarding the change in deferred revenue:
|
Income Taxes (Details) (USD $)
In Millions, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
---|---|---|
Income Tax Disclosure [Abstract] | ||
State tax liability | $ 0 | $ 0.2 |
Debt Obligations Securitization Debt (Details) (USD $)
In Thousands, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
||||
---|---|---|---|---|---|---|
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | $ 989,206 | $ 1,049,478 | ||||
Repurchase Option Percentage | 10.00% | |||||
Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 569,884 | 677,118 | ||||
Gross Receivables Pledged | 735,156 | 873,231 | ||||
Cash Reserve | 26,700 | 26,700 | ||||
2010-1 [Member] | Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 16,037 | 23,036 | ||||
Gross Receivables Pledged | 40,958 | 55,525 | ||||
Cash Reserve | 4,500 | 4,500 | ||||
Interest Rate | 3.60% | [1] | 3.60% | [1] | ||
2011-1 [Member] | Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 48,398 | 60,335 | ||||
Gross Receivables Pledged | 67,170 | 84,198 | ||||
Cash Reserve | 4,200 | 4,200 | ||||
Interest Rate | 3.00% | [1] | 3.00% | [1] | ||
2011-2 [Member] | Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 69,436 | 84,977 | ||||
Gross Receivables Pledged | 84,419 | 103,779 | ||||
Cash Reserve | 4,500 | 4,500 | ||||
Interest Rate | 2.90% | [1] | 2.90% | [1] | ||
2011-3 [Member] | Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 106,570 | 130,347 | ||||
Gross Receivables Pledged | 129,943 | 159,068 | ||||
Cash Reserve | 4,500 | 4,500 | ||||
Interest Rate | 3.90% | [1] | 3.90% | [1] | ||
2012-1 [Member] | Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 145,443 | 170,198 | ||||
Gross Receivables Pledged | 188,752 | 219,252 | ||||
Cash Reserve | 4,500 | 4,500 | ||||
Interest Rate | 3.50% | [1] | 3.50% | [1] | ||
2012-2 [Member] | Securitization Debt [Member]
|
||||||
Assets that Continue to be Recognized, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | ||||||
Debt Balance | 184,000 | 208,225 | ||||
Gross Receivables Pledged | 223,914 | 251,409 | ||||
Cash Reserve | $ 4,500 | $ 4,500 | ||||
Interest Rate | 2.90% | [1] | 2.90% | [1] | ||
|
Finance Receivables Allowance for Credit Losses (Details) (USD $)
|
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
|
Dec. 31, 2012
|
|
Allowance Activity: | |||
Balance, beginning of period | $ 252,590,000 | $ 221,533,000 | |
Provision for credit losses | 77,842,000 | 60,342,000 | |
Net charge-offs | (60,810,000) | (44,848,000) | |
Balance, end of period | 269,622,000 | 237,027,000 | |
Allowance as a percent of portfolio principal | 15.70% | 15.10% | |
Charge off Activity: | |||
Principal balances | (97,917,000) | (82,851,000) | |
Recoveries, net | 37,107,000 | 38,003,000 | |
Net charge-offs | (60,810,000) | (44,848,000) | |
Other Receivables | $ 29,400,000 | $ 37,000,000 |
Commitments And Contingencies (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
|
|
Warranty Accrual Activity | ||
Balance, Beginning of Period | $ 24,030 | $ 24,004 |
Warranty Expense | 8,556 | 7,441 |
Warranty Claims Paid | (7,678) | (4,009) |
Balance, End of Period | $ 24,908 | $ 27,436 |
Deferred Revenue (Details) (USD $)
|
3 Months Ended |
---|---|
Mar. 31, 2013
|
|
Movement in Deferred Revenue [Roll Forward] | |
Balance, Beginning of Period | $ 2,332,000 |
Gross Revenue Deferred | 7,037,000 |
Revenue Recognized | (358,000) |
Balance, End of Period | 9,011,000 |
Separately Priced Service Contracts [Member]
|
|
Movement in Deferred Revenue [Roll Forward] | |
Deferred Costs | $ 1,700,000 |
Debt Obligations
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3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2013
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Obligations | Debt Obligations Portfolio Term Financings The following is a summary of portfolio term financings:
Securitization debt The following is a summary of securitization transactions with outstanding balances for each period presented:
(1) These rates represent the original duration weighted average rates of the outstanding asset-backed securities. Asset-backed securities outstanding are secured by underlying pools of finance receivables (collateral) and investments held in trust (cash reserve). Credit enhancement for the asset-backed securities consists of a cash reserve account, over collateralization, and subordination of certain classes of notes in each trust to more senior classes of notes in such trust. Asset-backed securities outstanding have interest payable monthly at the fixed rates represented in the table above. All outstanding securitizations were rated in tranches with credit ratings from AAA to BBB by S&P and DBRS. Individual securitization trusts are not cross-collateralized or cross-defaulted. Additionally, we have the option to purchase the remaining loans in a trust when the remaining principal balances of the loans reach 10% of their original principal balance. Bank term financing Bank term financings are secured by underlying pools of finance receivables and a cash reserve account. At March 31, 2013 and December 31, 2012, our outstanding bank term financing with Wells Fargo Bank bears interest at LIBOR plus 2.00% (2.20% at both March 31, 2013 and December 31, 2012). This facility includes overcollateralization and a cash reserve similar to a securitization transaction, but consists of only one class of bonds and is unrated. At March 31, 2013 and December 31, 2012, $401.6 million and $443.9 million in receivables were pledged as collateral to this facility, respectively. At March 31, 2013 and December 31, 2012, $6.9 million was held as a cash reserve for this facility. Portfolio term residual financing The term residual facility with Santander Consumer USA Inc. ("Santander") is secured by residual interests in our warehouse facilities and certain securitization trusts. The amounts outstanding under the facility bear interest at LIBOR + 3.50% or LIBOR + 6.00%, depending upon whether certain conditions are satisfied. This facility provides for funding through December 2019, with a term-out feature resulting in a final maturity of December 2020. At March 31, 2013, we were in compliance with all financial covenants of the facility. For the three months ended March 31, 2013, interest accrued at LIBOR + 3.50% (3.70% at March 31, 2013). Portfolio warehouse facilities The following is a summary of portfolio warehouse facilities:
Deutsche Bank Warehouse Facility We have a revolving warehouse facility with Deutsche Bank AG, New York Branch (Deutsche Bank). The amounts outstanding under the facility bear interest at LIBOR plus 2.25%. At March 31, 2013, we were in compliance with all financial covenants of this facility. Wells Fargo Warehouse Facility We have a revolving warehouse facility with Wells Fargo Bank, N.A. (Wells Fargo). On March 15, 2013 we executed an amendment to permit contracts originated by GO Financial to be pledged as collateral. The amounts outstanding under the facility bear interest at LIBOR plus 2.25%. At March 31, 2013, we were in compliance with all financial covenants of this facility. RBS Warehouse Facility We have a revolving warehouse facility with The Royal Bank of Scotland plc (RBS). The amounts outstanding under the facility bear interest at LIBOR plus 2.25%. At March 31, 2013, we were in compliance with all financial covenants of this facility. Senior secured notes payable A summary of Senior Secured Notes payable follows:
In June 2010 we issued $200.0 million of 12.625% senior secured notes due 2017 (the “Senior Secured Notes”). The notes were issued with an original issuance price of 98.854%, resulting in an effective yield of 12.875%. Interest on the Senior Secured Notes is payable semi- annually in arrears on June 15th and December 15th of each year. As of March 31, 2013, we were in compliance with all financial covenants of the Senior Secured Notes. At March 31, 2013 and December 31, 2012, the Senior Secured Notes are shown net of unamortized discount of $1.6 million and $1.7 million, respectively. In May 2013, we issued an additional $50.0 million of the Senior Secured Notes. See Note 12- Subsequent Events for further information. Other secured notes payable A summary of other secured notes payable follows:
Revolving inventory facility We have a revolving inventory line with Wells Fargo, Santander and Manheim Automotive Financial Services, Inc. The interest rate on the facility is based on the Daily One Month Libor rate plus 3.5%. At March 31, 2013, we were in compliance with all financial covenants of this facility. Mortgage note payable We have a mortgage note payable which is secured by our operations call center building in Mesa, Arizona (a commercial property). Terms of the note agreement provide for monthly principal and interest payments with a final balloon payment. At March 31, 2013, we were in compliance with all financial covenants of this loan. Real Estate Facility We have a seven year fully amortizing real estate facility with Wells Fargo. The amounts outstanding under the facility bear interest at LIBOR plus 4.0%. At March 31, 2013, we were in compliance with all financial covenants of this facility, and the line was collateralized by nine properties. Equipment note payable We have an equipment note payable, which is secured by an aircraft and bears interest at the Prime rate plus 1.5%. In April 2013, we executed an amendment to the note, which extended the maturity date to April 2015 and lowered the interest rate to Prime plus 1.0%. Terms of the note agreement provide for monthly principal and interest payments with a final balloon payment. At March 31, 2013, we were in compliance with all financial covenants of this loan. |