Delaware | 001-36129 | 27-3379612 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
601 N.W. Second Street, Evansville, IN | 47708 | |
(Address of principal executive offices) | (Zip Code) | |
(812) 424-8031 | ||
(Registrant’s telephone number, including area code) | ||
Not Applicable | ||
(Former name or former address, if changed since last report) | ||
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 | Results of Operations and Financial Condition. |
Item 7.01 | Regulation FD Disclosure. |
Item 9.01 | Financial Statements and Exhibits. |
Exhibit Number | Description | |
ONEMAIN HOLDINGS, INC. | |||
(Registrant) | |||
Date: | February 11, 2019 | By: | /s/ Scott T. Parker |
Scott T. Parker | |||
Executive Vice President and Chief Financial Officer |
Exhibit 99.1 |
– | 4Q 2018 diluted EPS of $1.24 |
– | 4Q 2018 C&I adjusted diluted EPS of $1.39 |
– | 4Q 2018 C&I Ending Net Finance Receivables of $16.2 billion |
– | 4Q 2018 C&I Net Charge-Off ratio of 6.3% |
– | Initiating quarterly dividend of $0.25 per share |
OneMain Holdings, Inc. | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions, except per share amounts) | 12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/2017 | |||||||||||||||
Interest Income: | ||||||||||||||||||||
Finance charges | $ | 954 | $ | 930 | $ | 854 | $ | 3,645 | $ | 3,183 | ||||||||||
Finance receivables held for sale originated as held for investment | 4 | 3 | 3 | 13 | 13 | |||||||||||||||
Total interest income | 958 | 933 | 857 | 3,658 | 3,196 | |||||||||||||||
Interest expense | (229 | ) | (227 | ) | (204 | ) | (875 | ) | (816 | ) | ||||||||||
Provision for finance receivable losses | (278 | ) | (256 | ) | (231 | ) | (1,048 | ) | (955 | ) | ||||||||||
Net interest income after provision for finance receivable losses | 451 | 450 | 422 | 1,735 | 1,425 | |||||||||||||||
Other Revenues: | ||||||||||||||||||||
Insurance | 111 | 106 | 106 | 429 | 420 | |||||||||||||||
Investment | 16 | 18 | 15 | 66 | 73 | |||||||||||||||
Net gain on sale of real estate loans | 18 | — | — | 18 | — | |||||||||||||||
Net loss on repurchases and repayments of debt | — | — | — | (9 | ) | (29 | ) | |||||||||||||
Other (1) | 8 | 20 | 25 | 70 | 96 | |||||||||||||||
Total other revenues | 153 | 144 | 146 | 574 | 560 | |||||||||||||||
Other Expenses | ||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||
Salaries and benefits (2) | (206 | ) | (197 | ) | (195 | ) | (903 | ) | (757 | ) | ||||||||||
Acquisition-related transaction and integration expenses | (6 | ) | (9 | ) | (10 | ) | (54 | ) | (69 | ) | ||||||||||
Other operating expenses | (131 | ) | (141 | ) | (131 | ) | (536 | ) | (544 | ) | ||||||||||
Insurance policy benefits and claims | (47 | ) | (48 | ) | (45 | ) | (192 | ) | (184 | ) | ||||||||||
Total other expenses | (390 | ) | (395 | ) | (381 | ) | (1,685 | ) | (1,554 | ) | ||||||||||
Income before income taxes | 214 | 199 | 187 | 624 | 431 | |||||||||||||||
Income taxes (3) | (46 | ) | (51 | ) | (148 | ) | (177 | ) | (248 | ) | ||||||||||
Net income | $ | 168 | $ | 148 | $ | 39 | $ | 447 | $ | 183 | ||||||||||
Share Data: | ||||||||||||||||||||
Weighted average number of diluted shares: | 136.2 | 136.1 | 135.9 | 136.0 | 135.7 | |||||||||||||||
Diluted EPS | $ | 1.24 | $ | 1.09 | $ | 0.29 | $ | 3.29 | $ | 1.35 |
Note: Year-to-Date may not sum due to rounding. | |
(1) 4Q18 and YE 2018 include the fair value impairment of the remaining loans in held for sale after the 4Q18 real estate loan sale. | |
(2) YE 2018 includes $106 million of incentive compensation expense associated with the Fortress transaction, this expense was non-cash, equity neutral and not tax deductible. See our 2Q18 Earnings Release for more information. | |
(3) 4Q17 and YE 2017 includes a one-time impact of tax reform. See our 4Q17 Earnings Release for more information. |
OneMain Holdings, Inc. | |||||||||||||
CONSOLIDATED BALANCE SHEETS (UNAUDITED) | |||||||||||||
As of | |||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | ||||||||||
Assets | |||||||||||||
Cash and cash equivalents | $ | 679 | $ | 1,243 | $ | 987 | |||||||
Investment securities | 1,694 | 1,707 | 1,697 | ||||||||||
Net finance receivables: | |||||||||||||
Personal loans | 16,164 | 15,750 | 14,823 | ||||||||||
Other receivables (1), (2) | — | — | 134 | ||||||||||
Net finance receivables | 16,164 | 15,750 | 14,957 | ||||||||||
Unearned insurance premium and claim reserves | (662 | ) | (631 | ) | (590 | ) | |||||||
Allowance for finance receivable losses | (731 | ) | (706 | ) | (697 | ) | |||||||
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses | 14,771 | 14,413 | 13,670 | ||||||||||
Finance receivables held for sale (2) | 103 | 207 | 132 | ||||||||||
Restricted cash and restricted cash equivalents | 499 | 495 | 498 | ||||||||||
Goodwill | 1,422 | 1,422 | 1,422 | ||||||||||
Other intangible assets | 388 | 398 | 440 | ||||||||||
Other assets | 534 | 583 | 587 | ||||||||||
Total assets | $ | 20,090 | $ | 20,468 | $ | 19,433 | |||||||
Liabilities and Shareholders’ Equity | |||||||||||||
Long-term debt | $ | 15,178 | $ | 15,731 | $ | 15,050 | |||||||
Insurance claims and policyholder liabilities | 685 | 689 | 737 | ||||||||||
Deferred and accrued taxes | 45 | 24 | 45 | ||||||||||
Other liabilities | 383 | 384 | 323 | ||||||||||
Total liabilities | 16,291 | 16,828 | 16,155 | ||||||||||
Common stock | 1 | 1 | 1 | ||||||||||
Additional paid-in capital | 1,681 | 1,678 | 1,560 | ||||||||||
Accumulated other comprehensive income (loss) | (34 | ) | (22 | ) | 11 | ||||||||
Retained earnings | 2,151 | 1,983 | 1,706 | ||||||||||
Total shareholders’ equity | 3,799 | 3,640 | 3,278 | ||||||||||
Total liabilities and shareholders’ equity | $ | 20,090 | $ | 20,468 | $ | 19,433 |
(1) Other Receivables consist of Real Estate Loans and Retail Sales Finance, which were reported separately in prior periods. | |
(2) On September 30, 2018, the company transferred all of the real estate loans from Other Receivables to Finance Receivables Held for Sale. |
OneMain Holdings, Inc. | ||||||||||||||||||||
CONSOLIDATED KEY FINANCIAL METRICS (UNAUDITED) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017 | |||||||||||||||
Non-TDR Net Finance Receivables | $ | 15,711 | $ | 15,340 | $ | 14,590 | $ | 15,711 | $ | 14,590 | ||||||||||
TDR Net Finance Receivables | 453 | 410 | 367 | 453 | 367 | |||||||||||||||
Net Finance Receivables | $ | 16,164 | $ | 15,750 | $ | 14,957 | $ | 16,164 | $ | 14,957 | ||||||||||
Average Net Receivables | $ | 15,964 | $ | 15,695 | $ | 14,738 | $ | 15,471 | $ | 14,057 | ||||||||||
Average Daily Debt Balances | 15,516 | 15,743 | 14,696 | 15,444 | 14,224 | |||||||||||||||
Origination Volume | 3,268 | 2,899 | 3,132 | 11,923 | 10,537 | |||||||||||||||
Non-TDR Allowance | $ | 561 | $ | 546 | $ | 550 | $ | 561 | $ | 550 | ||||||||||
TDR Allowance | 170 | 160 | 147 | 170 | 147 | |||||||||||||||
Allowance | $ | 731 | $ | 706 | $ | 697 | $ | 731 | $ | 697 | ||||||||||
Non-TDR Allowance Ratio | 3.6 | % | 3.6 | % | 3.7 | % | 3.6 | % | 3.7 | % | ||||||||||
TDR Allowance Ratio | 37.5 | % | 39.0 | % | 39.9 | % | 37.5 | % | 39.9 | % | ||||||||||
Allowance Ratio | 4.5 | % | 4.5 | % | 4.7 | % | 4.5 | % | 4.7 | % | ||||||||||
Gross Charge-Off | $ | 280 | $ | 256 | $ | 256 | $ | 1,104 | $ | 1,054 | ||||||||||
Recoveries | (26 | ) | (27 | ) | (24 | ) | (113 | ) | (107 | ) | ||||||||||
Net Charge-Off | $ | 254 | $ | 229 | $ | 232 | $ | 991 | $ | 947 | ||||||||||
Gross Charge-Off Ratio | 7.0 | % | 6.5 | % | 6.9 | % | 7.1 | % | 7.5 | % | ||||||||||
Recoveries | (0.7 | )% | (0.7 | )% | (0.7 | )% | (0.7 | )% | (0.8 | )% | ||||||||||
Net Charge-Off Ratio | 6.3 | % | 5.8 | % | 6.3 | % | 6.4 | % | 6.7 | % | ||||||||||
30-89 Delinquency | $ | 390 | $ | 367 | $ | 372 | $ | 390 | $ | 372 | ||||||||||
30+ Delinquency | 753 | 687 | 729 | 753 | 729 | |||||||||||||||
60+ Delinquency | 524 | 472 | 517 | 524 | 517 | |||||||||||||||
90+ Delinquency | 363 | 320 | 357 | 363 | 357 | |||||||||||||||
30-89 Delinquency Ratio | 2.4 | % | 2.3 | % | 2.5 | % | 2.4 | % | 2.5 | % | ||||||||||
30+ Delinquency Ratio | 4.7 | % | 4.4 | % | 4.9 | % | 4.7 | % | 4.9 | % | ||||||||||
60+ Delinquency Ratio | 3.3 | % | 3.0 | % | 3.5 | % | 3.3 | % | 3.5 | % | ||||||||||
90+ Delinquency Ratio | 2.3 | % | 2.0 | % | 2.4 | % | 2.3 | % | 2.4 | % |
Note: Delinquency ratios are calculated as a percentage of net finance receivables. Charge-off ratios are calculated as a percentage of average net finance receivables. Ratios may not sum due to rounding. |
OneMain Holdings, Inc. | ||||||||||||
BALANCE SHEET METRICS (UNAUDITED) | ||||||||||||
As of | ||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | |||||||||
Liquidity | ||||||||||||
Cash and cash equivalents | $ | 679 | $ | 1,243 | $ | 987 | ||||||
Unencumbered personal loans | 7,607 | 6,646 | 5,007 | |||||||||
Undrawn conduit facilities | 5,950 | 5,800 | 5,050 | |||||||||
Total Assets | $ | 20,090 | $ | 20,468 | $ | 19,433 | ||||||
Less: Goodwill | (1,422 | ) | (1,422 | ) | (1,422 | ) | ||||||
Less: Other intangible assets | (388 | ) | (398 | ) | (440 | ) | ||||||
Tangible Managed Assets | $ | 18,280 | $ | 18,648 | $ | 17,571 | ||||||
Long-term debt | $ | 15,178 | $ | 15,731 | $ | 15,050 | ||||||
Less: Junior subordinated debt | (172 | ) | (172 | ) | (172 | ) | ||||||
Adjusted Debt | $ | 15,006 | $ | 15,559 | $ | 14,878 | ||||||
Total Shareholders' Equity | $ | 3,799 | $ | 3,640 | $ | 3,278 | ||||||
Less: Goodwill | (1,422 | ) | (1,422 | ) | (1,422 | ) | ||||||
Less: Other intangible assets | (388 | ) | (398 | ) | (440 | ) | ||||||
Plus: Junior subordinated debt | 172 | 172 | 172 | |||||||||
Adjusted Tangible Common Equity | $ | 2,161 | $ | 1,992 | $ | 1,588 | ||||||
Adjusted Debt to Adjusted Tangible Common Equity (Tangible Leverage) | 6.9 | x | 7.8 | x | 9.4 | x | ||||||
Adjusted Tangible Common Equity to Tangible Managed Assets | 11.8 | % | 10.7 | % | 9.0 | % | ||||||
OneMain Holdings, Inc. | |||||||||||||||
CONSOLIDATED RETURN ON RECEIVABLES (UNAUDITED) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
(unaudited, $ in millions) | 12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||
Revenue (1) | 26.7 | % | 26.2 | % | 26.0 | % | 26.1 | % | 25.4 | % | |||||
Net Charge-Off | (6.3 | )% | (5.8 | )% | (6.2 | )% | (6.4 | )% | (6.7 | )% | |||||
Risk Adjusted Margin | 20.3 | % | 20.4 | % | 19.8 | % | 19.7 | % | 18.7 | % | |||||
Operating Expenses | (8.6 | )% | (8.8 | )% | (9.1 | )% | (9.7 | )% | (9.7 | )% | |||||
Unlevered Return on Receivables | 11.7 | % | 11.6 | % | 10.7 | % | 10.1 | % | 9.0 | % | |||||
Interest Expense | (5.7 | )% | (5.8 | )% | (5.5 | )% | (5.7 | )% | (5.8 | )% | |||||
Change in Allowance | (0.6 | )% | (0.7 | )% | (0.1 | )% | (0.4 | )% | (0.1 | )% | |||||
Income Tax Expense (2) | (1.2 | )% | (1.3 | )% | (4.0 | )% | (1.1 | )% | (1.8 | )% | |||||
Return on Receivables | 4.3 | % | 3.8 | % | 1.1 | % | 2.9 | % | 1.3 | % |
Note: All ratios are based on consolidated results as a percentage of average net finance receivables held for investment. Ratios may not sum due to rounding. | |
(1) Revenue includes interest income on finance receivables plus other revenues less insurance policy benefits and claims. | |
(2) Income taxes assume a 37% statutory tax rate for 2017 and 24% for 2018. |
OneMain Holdings, Inc. | ||||||||||||||||||||
CONSUMER AND INSURANCE SEGMENT (UNAUDITED) (Non-GAAP) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017 | |||||||||||||||
Total interest income | $ | 959 | $ | 935 | $ | 875 | $ | 3,677 | $ | 3,305 | ||||||||||
Interest expense | (220 | ) | (218 | ) | (195 | ) | (844 | ) | (765 | ) | ||||||||||
Provision for finance receivable losses | (275 | ) | (253 | ) | (245 | ) | (1,047 | ) | (963 | ) | ||||||||||
Net interest income after provision for finance receivable losses | 464 | 464 | 435 | 1,786 | 1,577 | |||||||||||||||
Insurance | 111 | 106 | 106 | 429 | 420 | |||||||||||||||
Investment | 16 | 21 | 18 | 71 | 88 | |||||||||||||||
Other | 16 | 13 | 14 | 58 | 57 | |||||||||||||||
Total other revenues | 143 | 140 | 138 | 558 | 565 | |||||||||||||||
Operating expenses | (312 | ) | (320 | ) | (299 | ) | (1,247 | ) | (1,197 | ) | ||||||||||
Insurance policy benefits and claims | (47 | ) | (49 | ) | (45 | ) | (192 | ) | (185 | ) | ||||||||||
Total other expenses | (359 | ) | (369 | ) | (344 | ) | (1,439 | ) | (1,382 | ) | ||||||||||
Adjusted pretax income (non-GAAP) | 248 | 235 | 229 | 905 | 760 | |||||||||||||||
Income taxes (1) | (59 | ) | (56 | ) | (85 | ) | (217 | ) | (280 | ) | ||||||||||
Adjusted net income (non-GAAP) | $ | 189 | $ | 179 | $ | 144 | $ | 688 | $ | 480 | ||||||||||
Weighted average number of diluted shares | 136.2 | 136.1 | 135.9 | 136.2 | 135.7 | |||||||||||||||
C&I adjusted diluted EPS (2) | $ | 1.39 | $ | 1.31 | $ | 1.06 | 5.06 | 3.54 |
Note: Year-to-Date may not sum due to rounding. | |
(1) Income taxes assume a 37% statutory tax rate for 2017 periods and 24% for 2018 periods. | |
(2) C&I adjusted diluted EPS is calculated as the adjusted net income (non-GAAP) divided by the weighted average number of diluted shares outstanding. |
OneMain Holdings, Inc. | ||||||||||||||||||||
CONSUMER AND INSURANCE SEGMENT - KEY FINANCIAL METRICS (UNAUDITED) (Non-GAAP) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017 | |||||||||||||||
Non-TDR Net Finance Receivables | $ | 15,640 | $ | 15,253 | $ | 14,339 | $ | 15,640 | $ | 14,339 | ||||||||||
TDR Net Finance Receivables | 555 | 524 | 481 | 555 | 481 | |||||||||||||||
Net Finance Receivables (1) | $ | 16,195 | $ | 15,777 | $ | 14,820 | $ | 16,195 | $ | 14,820 | ||||||||||
Average Net Receivables | $ | 15,994 | $ | 15,619 | $ | 14,589 | $ | 15,401 | $ | 13,860 | ||||||||||
Origination Volume | 3,268 | 2,899 | 3,133 | 11,923 | 10,537 | |||||||||||||||
Non-TDR Allowance | $ | 563 | $ | 551 | $ | 533 | $ | 563 | $ | 533 | ||||||||||
TDR Allowance | 210 | 202 | 191 | 210 | 191 | |||||||||||||||
Allowance (1) | $ | 773 | $ | 753 | $ | 724 | $ | 773 | $ | 724 | ||||||||||
Non-TDR Allowance Ratio | 3.6 | % | 3.6 | % | 3.7 | % | 3.6 | % | 3.7 | % | ||||||||||
TDR Allowance Ratio | 37.7 | % | 38.6 | % | 39.7 | % | 37.7 | % | 39.7 | % | ||||||||||
Allowance Ratio | 4.8 | % | 4.8 | % | 4.9 | % | 4.8 | % | 4.9 | % | ||||||||||
Gross Charge-Off | $ | 285 | $ | 260 | $ | 264 | $ | 1,127 | $ | 1,100 | ||||||||||
Recoveries | (30 | ) | (31 | ) | (28 | ) | (129 | ) | (129 | ) | ||||||||||
Net Charge-Off | $ | 255 | $ | 229 | $ | 236 | $ | 998 | $ | 971 | ||||||||||
Gross Charge-Off Ratio | 7.1 | % | 6.6 | % | 7.2 | % | 7.3 | % | 7.9 | % | ||||||||||
Recoveries | (0.8 | )% | (0.8 | )% | (0.8 | )% | (0.8 | )% | (0.9 | )% | ||||||||||
Net Charge-Off Ratio | 6.3 | % | 5.8 | % | 6.4 | % | 6.5 | % | 7.0 | % | ||||||||||
30-89 Delinquency | $ | 393 | $ | 369 | $ | 362 | $ | 393 | $ | 362 | ||||||||||
30+ Delinquency | 758 | 691 | 701 | 758 | 701 | |||||||||||||||
60+ Delinquency | 527 | 475 | 496 | 527 | 496 | |||||||||||||||
90+ Delinquency | 365 | 322 | 339 | 365 | 339 | |||||||||||||||
30-89 Delinquency Ratio | 2.4 | % | 2.3 | % | 2.4 | % | 2.4 | % | 2.4 | % | ||||||||||
30+ Delinquency Ratio | 4.7 | % | 4.4 | % | 4.7 | % | 4.7 | % | 4.7 | % | ||||||||||
60+ Delinquency Ratio | 3.3 | % | 3.0 | % | 3.4 | % | 3.3 | % | 3.4 | % | ||||||||||
90+ Delinquency Ratio | 2.3 | % | 2.0 | % | 2.3 | % | 2.3 | % | 2.3 | % | ||||||||||
Note: Consumer & Insurance financial information is presented on an adjusted Segment Accounting Basis. Delinquency ratios are calculated as a percentage of net finance receivables. All other ratios are shown as a percentage of C&I average net finance receivables. Ratios may not sum due to rounding. | |
(1) For reconciliation to GAAP, see "Reconciliation of Key Segment Metrics (Unaudited) (Non-GAAP)". |
OneMain Holdings, Inc. | |||||||||||||||
CONSUMER & INSURANCE SEGMENT METRICS (UNAUDITED) (Non-GAAP) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
(unaudited, $ in millions) | 12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||
Revenue (1) | 26.4 | % | 26.3 | % | 26.5 | % | 26.2 | % | 26.6 | % | |||||
Net Charge-Off | (6.3 | )% | (5.8 | )% | (6.4 | )% | (6.5 | )% | (7.0 | )% | |||||
Risk Adjusted Margin | 20.1 | % | 20.5 | % | 20.1 | % | 19.8 | % | 19.6 | % | |||||
Operating Expenses | (7.8 | )% | (8.2 | )% | (8.2 | )% | (8.1 | )% | (8.6 | )% | |||||
Unlevered Return on Receivables | 12.3 | % | 12.3 | % | 11.9 | % | 11.7 | % | 10.9 | % | |||||
Interest Expense | (5.5 | )% | (5.6 | )% | (5.3 | )% | (5.5 | )% | (5.5 | )% | |||||
Change in Allowance | (0.5 | )% | (0.7 | )% | (0.2 | )% | (0.3 | )% | 0.1 | % | |||||
Income Tax Expense (2) | (1.5 | )% | (1.4 | )% | (2.4 | )% | (1.4 | )% | (2.0 | )% | |||||
Return on Receivables | 4.7 | % | 4.6 | % | 4.0 | % | 4.5 | % | 3.5 | % |
Note: Consumer & Insurance financial information is presented on an adjusted Segment Accounting Basis. All ratios are shown as a percentage of C&I average net finance receivables. Ratios may not sum due to rounding. | |
(1) Revenue includes interest income on finance receivables plus other revenues less insurance policy benefits and claims. | |
(2) Income taxes assume a 37% statutory tax rate for 2017 and 24% for 2018. |
OneMain Holdings, Inc. | ||||||||||||||||||||
ACQUISITIONS AND SERVICING SEGMENT (UNAUDITED) (Non-GAAP) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017 | |||||||||||||||
Portfolio Servicing Fees from SpringCastle | $ | 7 | $ | 8 | $ | 10 | $ | 33 | $ | 40 | ||||||||||
Other | — | — | — | — | 2 | |||||||||||||||
Total Other Revenues | 7 | 8 | 10 | 33 | 42 | |||||||||||||||
Total Other Expenses | (7 | ) | (8 | ) | (10 | ) | (32 | ) | (41 | ) | ||||||||||
Adjusted pretax income (non-GAAP) | $ | — | $ | — | $ | — | $ | 1 | $ | 1 | ||||||||||
Note: | Acquisitions & Servicing financial information is presented on an adjusted Segment Accounting Basis. Year-to-Date may not sum due to rounding. |
OneMain Holdings, Inc. | ||||||||||||||||||||
OTHER (UNAUDITED) (Non-GAAP) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions) | 12/31/2018 | 9/30/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017 | |||||||||||||||
Interest Income: | ||||||||||||||||||||
Finance Charges | $ | — | $ | 2 | $ | 3 | $ | 7 | $ | 12 | ||||||||||
Finance Receivables Held for Sale | 4 | 2 | 2 | 10 | 11 | |||||||||||||||
Total Interest Income | 4 | 4 | 5 | 17 | 23 | |||||||||||||||
Interest Expense | (4 | ) | (4 | ) | (5 | ) | (17 | ) | (21 | ) | ||||||||||
Provision for Finance Receivable Losses (1) | — | — | — | 5 | (7 | ) | ||||||||||||||
Net Interest Income after Provision for Finance Receivable Losses | — | — | — | 5 | (5 | ) | ||||||||||||||
Total Other Revenues | 1 | 1 | 3 | — | 3 | |||||||||||||||
Total Other Expenses | (4 | ) | (5 | ) | (10 | ) | (25 | ) | (33 | ) | ||||||||||
Adjusted Pretax Income (non-GAAP) | $ | (3 | ) | $ | (4 | ) | $ | (7 | ) | $ | (20 | ) | $ | (35 | ) | |||||
Net Finance Receivables Held for Investment: | ||||||||||||||||||||
Personal Loans | $ | — | $ | — | $ | 6 | $ | — | $ | 6 | ||||||||||
Other Receivables (2) | — | — | 136 | — | 136 | |||||||||||||||
Total Net Finance Receivables Held for Investment | $ | — | $ | — | $ | 142 | $ | — | $ | 142 | ||||||||||
Net Finance Receivables Held For Sale | $ | 103 | $ | 215 | $ | 138 | $ | 103 | $ | 138 |
Note: | Other financial information is presented on an adjusted Segment Accounting Basis. Effective 1Q18, Retail Sales Finance and Real Estate receivables were combined as "Other Receivables." Prior periods have been revised to conform to the new presentation. Year-to-Date may not sum due to rounding. | ||
(1 | ) | For the year ended 2017 provision for finance receivable losses includes approximately $5 million increase in net charge-offs attributable to the impact of hurricanes Harvey and Maria. | |
(2 | ) | On September 30, 2018, the company transferred Other Receivables from held for investment to held for sale. |
OneMain Holdings, Inc. | ||||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
(unaudited, $ in millions) | 12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | |||||||||||||||
Consumer & Insurance | $ | 234 | $ | 226 | $ | 219 | $ | 787 | $ | 676 | ||||||||||
Acquisitions & Servicing | — | — | — | 1 | 1 | |||||||||||||||
Other | (9 | ) | (4 | ) | (7 | ) | (132 | ) | (41 | ) | ||||||||||
Segment to GAAP Adjustment | (11 | ) | (23 | ) | (25 | ) | (32 | ) | (205 | ) | ||||||||||
Income Before Income Taxes - GAAP basis | $ | 214 | $ | 199 | $ | 187 | $ | 624 | $ | 431 | ||||||||||
Pretax Income - Segment Accounting Basis | $ | 234 | $ | 226 | $ | 219 | $ | 787 | $ | 676 | ||||||||||
Net Loss on Repurchases and Repayments of Debt (1) | — | — | — | 63 | 18 | |||||||||||||||
Acquisition-Related Transaction and Integration Expenses (1) | 6 | 9 | 10 | 47 | 66 | |||||||||||||||
Restructuring Charges | 8 | — | — | 8 | — | |||||||||||||||
Consumer & Insurance Adjusted Pretax Income (non-GAAP) | $ | 248 | $ | 235 | $ | 229 | $ | 905 | $ | 760 | ||||||||||
Pretax Income - Segment Accounting Basis | — | — | — | 1 | 1 | |||||||||||||||
Adjustments | — | — | — | — | — | |||||||||||||||
Acquisitions & Servicing Adjusted Pretax Income (non-GAAP) | $ | — | $ | — | $ | — | $ | 1 | $ | 1 | ||||||||||
Pretax Loss - Segment Accounting Basis | $ | (9 | ) | $ | (4 | ) | $ | (7 | ) | $ | (132 | ) | $ | (41 | ) | |||||
Net Loss on Sale of Real Estate Loans (2) | 6 | — | — | 6 | — | |||||||||||||||
Non-Cash Incentive Compensation Expense (3) | — | — | — | 106 | — | |||||||||||||||
Acquisition-Related Transaction and Integration Expenses (1) | — | — | — | — | 6 | |||||||||||||||
Other Adjusted Pretax Loss (non-GAAP) | $ | (3 | ) | $ | (4 | ) | $ | (7 | ) | $ | (20 | ) | $ | (35 | ) | |||||
Springleaf Debt Discount Accretion | $ | (6 | ) | $ | (6 | ) | $ | (11 | ) | $ | (24 | ) | $ | (69 | ) | |||||
OMFH LLR Provision Catch-up | (4 | ) | (4 | ) | (3 | ) | (15 | ) | (35 | ) | ||||||||||
OMFH Receivable Premium Amortization | (8 | ) | (10 | ) | (24 | ) | (50 | ) | (142 | ) | ||||||||||
OMFH Receivable Discount Accretion | 4 | 4 | 16 | 22 | 56 | |||||||||||||||
Other | 3 | (7 | ) | (3 | ) | 35 | (15 | ) | ||||||||||||
Total Segment to GAAP Adjustment | $ | (11 | ) | $ | (23 | ) | $ | (25 | ) | $ | (32 | ) | $ | (205 | ) |
Note: | Year-to-Date may not sum due to rounding. | |
(1) | Amounts differ from those presented on "Consolidated Statements of Operations (Unaudited)" page as a result of purchase accounting adjustments that are not applicable on a Segment Accounting Basis. | |
(2) | In 4Q18, the gain on the sale of the real estate loans sold has been combined with the resulting fair value impairment of the remaining loans in finance receivables held for sale. | |
(3) | Incentive compensation expense associated with the Fortress transaction, this expense was non-cash, equity neutral and not tax deductible. |
OneMain Holdings, Inc. | ||||||||||||
RECONCILIATION OF KEY SEGMENT METRICS (UNAUDITED) (Non-GAAP) | ||||||||||||
As of | ||||||||||||
(unaudited, $ in millions) | 12/31/18 | 9/30/18 | 12/31/17 | |||||||||
Consumer & Insurance | $ | 16,195 | $ | 15,777 | $ | 14,820 | ||||||
Acquisition & Servicing | — | — | — | |||||||||
Other (1) | — | — | 142 | |||||||||
Segment to GAAP Adjustment | (31 | ) | (27 | ) | (5 | ) | ||||||
Net Finance Receivables - GAAP basis | $ | 16,164 | $ | 15,750 | $ | 14,957 | ||||||
Consumer & Insurance | $ | 773 | $ | 753 | $ | 724 | ||||||
Acquisition & Servicing | — | — | — | |||||||||
Other (1) | — | — | 36 | |||||||||
Segment to GAAP Adjustment | (42 | ) | (47 | ) | (63 | ) | ||||||
Allowance for Finance Receivable Losses - GAAP basis | $ | 731 | $ | 706 | $ | 697 | ||||||
(1) On September 30, 2018, the company transferred real estate loans from held for investment to held for sale. |