EX-99.1 2 ex991-q42023pressrelease.htm EX-99.1 Document

CURO Group Holdings Corp. Reports Preliminary
Fourth Quarter and Full Year 2023 Financial Results

-Gross loans receivables increased 3.3%, year-over-year, and 3.3%, sequentially, to $1.3 billion-
-Total fourth quarter revenue of $168.2 million-
-Net charge-off improvement of 440 bps, year-over-year, and 120 bps, sequentially, to 16.5%-
-Cancels earnings conference call previously scheduled for Wednesday, February 7, 2024 -



Chicago, Illinois--February 5, 2024 - CURO Group Holdings Corp. (NYSE: CURO) (“CURO” or the “Company”), an omni-channel consumer finance company serving consumers in the U.S. and Canada, today announced preliminary financial results for its fourth quarter and full year ended December 31, 2023.

"Throughout 2023, we executed on our plan to enhance our underwriting and credit performance and simplify our overall operations, including consolidating our U.S. footprint onto one loan management system and further scaling our data and technological capabilities," said Doug Clark, Chief Executive Officer at CURO. "As a result, we showed improvement in our delinquency and charge-off performance, as well as a marked reduction in our operating expenses. As we continue to execute on our long-term U.S. and Canadian strategy, we are engaged in constructive dialogue with our lenders to strengthen our balance sheet and better position CURO for growth and success. We are proud of the foundation we laid in 2023 and look forward to building on this momentum in 2024. We thank our CURO employees for their dedication and hard work as we move forward.”

Preliminary Fourth Quarter 2023 Consolidated Summary Results
Current and prior period financial information is presented on a continuing operations basis, which excludes the Canada POS Lending segment due to the sale of Flexiti on August 31, 2023.
•Gross loans receivable of $1.3 billion increased $41.3 million, or 3.3%, sequentially, and $41.3 million, or 3.3%, year-over-year.
◦Gross loans receivable in the U.S. were stable year-over-year, with increases in larger balance and longer-term loans offset by reductions in smaller balance and shorter-term loans. Sequentially, Gross loans receivable in the U.S. increased $23.1 million, or 3.1%, due to increases in larger balance and longer-term loans.
◦Gross loans receivable in Canada increased by $39.7 million, or 8.3%, year-over-year, and $18.2 million, or 3.6%, sequentially, driven by increases in Canadian Revolving LOC loans and favorable foreign currency exchange rates.

•Total revenue of $168.2 million declined $13.7 million, or 7.6%, year-over-year, primarily related to the mix shift to larger, longer-term, higher credit and lower yielding loans. Sequentially, total revenue increased by $0.3 million, or 0.2%.
•Net revenue of $110.5 million increased $6.3 million, or 6.0%, year-over-year, primarily driven by a $20.0 million, or 25.8%, decrease in provision for credit loss expense related to the mix shift to larger and longer-term loans to higher credit quality customers and enhanced collections efforts, partially offset by the reduction in Total revenue. Sequentially, Net revenue decreased $8.4 million, or 7.0%, primarily driven by additional provision for credit loss expense due to new loans originated during the fourth quarter, partially offset by the improvement in net charge-off rate.

•Net charge-off rate of 16.5% improved 440 bps, year-over-year, and improved 120 bps sequentially, driven by increased credit quality as a result of the product mix shift, credit tightening and servicing optimization.
•Total operating expenses of $91.2 million decreased $20.4 million, or 18.3%, year-over-year, and $3.0 million, or 3.1%, sequentially.

As of or for the Quarter Ended
(unaudited)
Dec 31,Sep 30,Jun 30,Mar 31,Dec 31,
Delinquency and Loss Ratios
20232023202320232022
31-60 days delinquency ratio2.2 %2.4 %2.5 %2.1 %2.4 %
61-90 days delinquency ratio1.6 %1.7 %1.7 %1.8 %1.8 %
91+ days delinquency ratio4.6 %4.4 %4.1 %4.4 %3.4 %
Net charge-offs16.5 %17.7 %18.8 %15.6 %20.9 %

Conference Call Cancellation and Consent Solicitation
In a separate press release issued today, CURO announced the commencement of a consent solicitation from the holders of its 7.500% Senior 1.5 Lien Senior Secured Notes Due 2028. As a result, CURO has cancelled its earnings conference call previously scheduled for 8:00 a.m. Eastern Time on Wednesday, February 7, 2024.
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Preliminary Results
The financial results presented and discussed herein are on a preliminary and unaudited basis; final audited data will be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
About CURO
CURO Group Holdings Corp. (NYSE: CURO) is a leading consumer credit lender serving U.S. and Canadian customers for over 25 years. Our roots in the consumer finance market run deep. We’ve worked diligently to provide customers a variety of convenient, easily accessible financial services. Our decades of diversified data power a hard-to-replicate underwriting and scoring engine, mitigating risk across the full spectrum of credit products. We operate under a number of brands including Cash Money®, LendDirect®, Heights Finance, Southern Finance, Covington Credit, Quick Credit and First Heritage Credit. For more information, please visit http://www.curo.com.
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Table 1 - Consolidated Statements of Operations
(in thousands, except per share data, unaudited)Three Months Ended,
Year Ended,
Dec 31,
Sep 30,Jun 30,Mar 31,Dec 31,Dec 31,
202320232023202320222023
Revenue
Interest and fees revenue$142,239 $143,493 $141,766 $144,304 $150,350 571,802 
Insurance and other income25,940 24,370 25,250 25,064 31,575 100,624 
Total revenue168,179 167,863 167,016 169,368 181,925 672,426 
Provision for losses57,689 49,009 63,755 48,364 77,724 218,817 
Net revenue110,490 118,854 103,261 121,004 104,201 453,609 
Operating Expenses
Salaries and benefits49,537 52,148 53,144 56,619 60,149 211,448 
Occupancy11,277 10,454 10,885 11,344 11,785 43,960 
Advertising2,435 2,819 1,967 1,999 3,383 9,220 
Direct operations11,496 12,176 12,032 9,745 7,921 45,449 
Depreciation and amortization5,578 5,390 5,339 5,390 5,329 21,697 
Other operating expense10,915 11,207 7,918 18,054 23,065 48,094 
Total operating expenses91,238 94,194 91,285 103,151 111,632 379,868 
Other expense
Interest expense58,341 55,798 50,460 44,045 41,180 208,644 
Loss from equity method investment3,310 1,453 2,134 3,413 1,932 10,310 
Goodwill Impairment— — — — 107,827 — 
Extinguishment or modification of debt costs— — 8,864 — 24 8,864 
Gain on sale of business— — — 2,027 — 2,027 
Miscellaneous expenses— — 1,435 — — 1,435 
Total other expense
61,651 57,251 62,893 49,485 150,963 231,280 
Loss from continuing operations before income taxes
(42,399)(32,591)(50,917)(31,632)(158,394)(157,539)
Provision (benefit) for income taxes from continuing operations
1,094 1,021 3,147 23,277 (15,970)28,539 
Net loss from continuing operations
$ (43,493)$ (33,612)$ (54,064)$ (54,909)$ (142,424)$ (186,078)
Net loss from discontinued operations
— (70,830)(5,263)(4,562)(43,969)(80,655)
Net loss
$ (43,493)$ (104,442)$ (59,327)$ (59,471)$ (186,393)$ (266,733)
Basic loss per share:
Continuing operations$ (1.05)$(0.81)$(1.32)$(1.35)$(3.52)$(4.53)
Discontinued operations$ — $(1.72)$(0.13)$(0.11)$(1.09)$(1.96)
Diluted loss per share:
Continuing operations$(1.05)$(0.81)$(1.32)$(1.35)$(3.52)$(4.53)
Discontinued operations$— $(1.72)$(0.13)$(0.11)$(1.09)$(1.96)
Weighted average common shares outstanding:
Basic41,317 41,267 41,002 40,783 40,428 41,093 
Diluted41,317 41,267 41,002 40,783 40,428 41,093 

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Table 2 - Consolidated Balance Sheets
As of
Dec 31,Sep 30,Jun 30,Mar 31,Dec 31,
(in thousands, unaudited)20232023202320232022
ASSETS
Cash and cash equivalents$ 84,594 $ 82,550 $ 101,033 $ 40,449 $ 50,856 
Restricted cash48,008 53,818 76,375 90,211 59,645 
Gross loans receivable 1,295,660 1,254,401 1,227,615 1,209,576 1,254,395 
Less: Allowance for credit losses
(206,227)(199,739)(210,292)(202,757)(81,185)
Loans receivable, net1,089,433 1,054,662 1,017,323 1,006,819 1,173,210 
Income taxes receivable54,986 58,064 20,854 22,737 23,984 
Prepaid expenses and other45,221 61,441 42,131 45,592 51,081 
Property and equipment, net22,206 23,903 25,826 27,244 29,232 
Investment in Katapult13,605 16,915 18,368 20,502 23,915 
Right of use asset - operating leases49,606 51,413 53,042 51,615 58,177 
Deferred tax assets13,248 14,194 15,304 13,623 18,138 
Goodwill276,951 276,269 277,069 276,487 276,269 
Intangibles, net75,301 74,336 74,007 71,798 70,913 
Other assets9,745 9,387 6,673 6,785 8,370 
Assets, discontinued operations— — 1,016,832 947,925 945,403 
Total Assets$ 1,782,904 $ 1,776,952 $ 2,744,837 $ 2,621,787 $ 2,789,193 
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Liabilities
Accounts payable and accrued liabilities $56,800 $62,992 $54,169 $60,890 $45,595 
Deferred revenue2,298 2,358 3,370 3,493 3,467 
Lease liability - operating leases51,715 51,579 53,182 52,061 59,396 
Income taxes payable3,552 2,537 (1,242)— — 
Accrued interest 40,792 20,953 39,306 20,090 38,460 
Debt2,055,853 2,024,934 1,988,173 1,888,407 1,882,608 
Other long-term liabilities7,595 9,620 10,017 10,045 11,736 
Liabilities, discontinued operations — — 866,235 815,617 802,065 
Total Liabilities$ 2,218,605 $ 2,174,973 $ 3,013,210 $ 2,850,603 $ 2,843,327 
Total Stockholders' Deficit
(435,701)(398,021)(268,373)(228,816)(54,134)
Total Liabilities and Stockholders' (Deficit) Equity$ 1,782,904 $ 1,776,952 $ 2,744,837 $ 2,621,787 $ 2,789,193 

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Table 3 - Consolidated Portfolio Performance
(in thousands, except percentages, unaudited)Q4 2023Q3 2023Q2 2023Q1 2023Q4 2022
Gross loans receivable
Revolving LOC$ 488,932$ 469,041$ 472,902$ 461,443$ 451,077
Installment loans 806,728785,360754,713748,133803,318
Total gross loans receivable$ 1,295,660$ 1,254,401$ 1,227,615$ 1,209,576$ 1,254,395
Lending Revenue
Revolving LOC$ 50,794$ 51,039$ 49,483$ 49,092$ 49,915
Installment loans91,44592,45492,28395,212100,435
Total lending revenue$ 142,239$ 143,493$ 141,766$ 144,304$ 150,350
Lending Provision
Revolving LOC$ 20,131$ 19,031$ 27,089$ 15,539$ 29,620
Installment loans36,26928,46435,17131,13946,442
Total lending provision$ 56,400$ 47,495$ 62,260$ 46,678$ 76,062
NCOs
Revolving LOC$ 19,989$ 22,023$ 21,780$ 6,234$ 26,715
Installment loans 32,90833,34235,48341,07838,168
Total NCOs$ 52,897$ 55,365$ 57,263$ 47,312$ 64,883
NCO rate (annualized) (1)
Revolving LOC16.6%18.6%18.7%5.5%23.8%
Installment loans 16.4%17.2%18.9%21.5%19.3%
Total NCO rate16.5%17.7%18.8%15.6%20.9%
ACL rate (2) (3)
Revolving LOC25.0%25.4%26.6 %25.6 %8.4 %
Installment loans 10.4%10.3%11.2 %11.3 %5.4 %
Total ACL rate15.9%15.9%17.1 %16.8 %6.5 %
31+ days past-due rate (2)
Revolving LOC8.0%8.6%8.5 %8.4 %4.1 %
Installment loans 8.6%8.5%8.1 %8.2 %9.6 %
Total past-due rate8.3%8.5%8.3 %8.3 %7.6 %
(1) We calculate NCO rate as total quarterly NCOs divided by Average gross loans receivable, then we annualize the rate. The amount and timing of recoveries are impacted by our collection strategies, which are based on customer behavior and risk profile and include direct customer communications and the periodic sale of charged off loans.
(2) We calculate (i) ACL rate and (ii) 31+ days past-due rate as the respective totals divided by gross loans receivable at each quarter end.
(3) We adopted ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" on January 1, 2023, which requires us to estimate the lifetime expected credit loss on financial instruments. Our previous model required the recognition of credit losses when it was probable that a loss had been incurred.

Forward-Looking Statements
This press release contains forward-looking statements. These forward-looking statements include projections, estimates and assumptions about various matters, such as future financial and operational performance, including our plans to address our liquidity and debt obligations and executing on our long-term U.S. and Canadian strategy. In addition, words such as “guidance,” “estimate,” “anticipate,” “believe,” “forecast,” “step,” “plan,” “predict,” “focused,” “project,” “is likely,” “expect,” "anticipate," “intend,” “should,” “will,” “confident,” variations of such words and similar expressions are intended to identify forward-looking statements. Our ability to achieve these forward-looking statements is based on certain assumptions, judgments and other factors, both within and outside of our control, that could cause actual results to differ materially from those in the forward-looking statements, including: risks relating to the uncertainty of projected financial and operational information and forecasts, including errors in our internal forecasts; our ability to manage growth; our dependence on third-party lenders to provide the cash we need to fund our loans and our ability to affordably access third-party financing; our level of indebtedness; the effects of competition on our business; our ability to attract and retain customers; global economic, market, financial, political or health conditions or events; actions of regulators and the impact of those actions on our business; our ability to protect our proprietary technology and analytics and keep up with that of our competitors; disruption of our information technology systems that adversely affect our business operations;
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ineffective pricing of the credit risk of our prospective or existing customers; inaccurate information supplied by customers or third parties that could lead to errors in judging customers’ qualifications to receive loans; improper disclosure of customer personal data; failure of third parties who provide products, services or support to us; disruption to our relationships with banks and other third-party electronic payment solutions providers as well as other factors discussed in our filings with the Securities and Exchange Commission. These projections, estimates and assumptions may prove to be inaccurate in the future. These forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. There may be additional risks that we presently do not know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual future results. We undertake no obligation to update, amend or clarify any forward-looking statement for any reason.

Investor Relations:
Email: IR@curo.com
(CURO-NWS)
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