Exhibit 99.1
AMERICREDIT REPORTS FOURTH QUARTER AND FISCAL YEAR 2008
OPERATING RESULTS
| • |
4th quarter net loss of $150 million, $1.30 per share |
| • | Quarterly pre-tax income of $13 million excluding goodwill impairment and restructuring charge |
| • | Quarterly charge-offs declined sequentially to 5.9% |
| • | Unrestricted cash balance of $433 million |
FORT WORTH, TEXAS August 6, 2008 – AMERICREDIT CORP. (NYSE: ACF) today announced a net loss of $150 million, or $1.30 per share, for its fiscal fourth quarter ended June 30, 2008. AmeriCredit reported net income of $87 million, or $0.66 per share, for the same period a year earlier. For the fiscal year ended June 30, 2008, AmeriCredit reported a net loss of $69 million, or $0.60 per share, compared to net income of $360 million, or $2.73 per share, for the fiscal year ended June 30, 2007.
Net loss for the quarter ended June 30, 2008, included a $135 million after-tax impairment charge ($213 million pre-tax), or $1.17 per share, related to the write-off of goodwill recorded in connection with the acquisitions of Long Beach Acceptance Corp. and Bay View Acceptance Corporation, and a $7 million after-tax restructuring charge ($11 million pre-tax), or $0.06 per share, related to changes in our lending programs and organizational structure.
“Excluding the goodwill impairment and restructuring charge, we earned $13 million pre-tax for the quarter even after significantly increasing loan loss provisions to build our allowance for loan losses,” said AmeriCredit Chief Financial Officer Chris Choate.
The allowance for loan losses as a percentage of receivables increased to 6.3% at June 30, 2008, from 5.7% at March 31, 2008.
Originations were $780 million for the quarter ended June 30, 2008, compared to $2.51 billion for the same quarter last year. Originations for the fiscal year ended June 30, 2008, were $6.29 billion, compared to $8.45 billion for the prior fiscal year. Managed receivables totaled $14.98 billion at June 30, 2008, compared to $15.95 billion at June 30, 2007.
Annualized net charge-offs totaled 5.9% of average managed receivables for the quarter ended June 30, 2008, compared to 3.3% for the quarter ended June 30, 2007. For the fiscal year ended June 30, 2008, net charge-offs were 6.2%, compared to 4.7% last year.
Managed auto receivables 31-to-60 days delinquent were 6.0% of the portfolio at June 30, 2008, compared to 4.7% at June 30, 2007. Accounts more than 60 days delinquent were 2.9% of the portfolio at June 30, 2008, compared to 2.1% a year ago.
“We have taken proactive steps to conserve liquidity and position the business to withstand the weak macroeconomic environment and the dislocation in the capital markets,” said AmeriCredit President and Chief Executive Officer Dan Berce. “Our goal as we manage through this challenging environment is to protect the value of our platform and position the franchise to provide shareholder value well into the future.”
AmeriCredit will host a conference call for analysts and investors today at 5:30 p.m. Eastern time. For a live Internet broadcast of this conference call, please go to the Company’s Web site to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call.
About AmeriCredit
AmeriCredit Corp. is a leading independent automobile finance company that provides financing solutions indirectly through auto dealers across the United States. AmeriCredit has over one million customers and approximately $15 billion in managed auto receivables. The Company was founded in 1992 and is headquartered in Fort Worth, Texas. For more information, visit www.americredit.com.
Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements that involve risks and uncertainties detailed from time to time in the Company’s filings and reports with the Securities and Exchange Commission including the Company’s annual report on Form 10-K for the year ended June 30, 2007. Such risks include – but are not limited to – variable economic conditions, adverse portfolio performance, volatile wholesale vehicle values, reliance on warehouse financing and capital markets, the ability to continue to securitize its loan portfolio, the continued availability of credit enhancement for its securitization transactions on acceptable terms, fluctuating interest rates, increased competition, regulatory changes, the high degree of risk associated with subprime borrowers, and exposure to litigation. These forward-looking statements are based on the beliefs of the Company’s management as well as assumptions made by and information currently available to Company management. Actual events or results may differ materially. It is advisable not to place undue reliance on any forward-looking statements. The Company undertakes no obligation to, and does not, publicly update or revise any forward-looking statements, except as required by federal securities laws, whether as a result of new information, future events or otherwise.
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AmeriCredit Corp.
Consolidated Statement of Operations
(Unaudited, Dollars in Thousands, Except Per Share Amounts)
| Three Months Ended June 30, | Fiscal Year Ended June 30, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Revenue: |
||||||||||||||||
| Finance charge income |
$ | 562,184 | $ | 591,792 | $ | 2,382,484 | $ | 2,142,470 | ||||||||
| Other income |
36,216 | 33,247 | 159,779 | 136,093 | ||||||||||||
| Servicing income |
12 | 354 | 819 | 9,363 | ||||||||||||
| Gain on sale of equity investment |
— | — | — | 51,997 | ||||||||||||
| 598,412 | 625,393 | 2,543,082 | 2,339,923 | |||||||||||||
| Costs and expenses: |
||||||||||||||||
| Operating expenses |
89,749 | 106,681 | 397,814 | 398,434 | ||||||||||||
| Leased vehicles depreciation |
12,250 | 1,207 | 36,362 | 1,283 | ||||||||||||
| Provision for loan losses |
279,145 | 189,920 | 1,130,962 | 727,653 | ||||||||||||
| Impairment of goodwill |
212,595 | — | 212,595 | — | ||||||||||||
| Interest expense |
204,034 | 194,884 | 837,412 | 680,825 | ||||||||||||
| Restructuring charges |
11,259 | (1,482 | ) | 20,116 | (339 | ) | ||||||||||
| 809,032 | 491,210 | 2,635,261 | 1,807,856 | |||||||||||||
| (Loss) income before income taxes |
(210,620 | ) | 134,183 | (92,179 | ) | 532,067 | ||||||||||
| Income tax (benefit) provision |
(60,407 | ) | 47,328 | (22,860 | ) | 171,818 | ||||||||||
| Net (loss) income |
$ | (150,213 | ) | $ | 86,855 | $ | (69,319 | ) | $ | 360,249 | ||||||
| (Loss) earnings per share: |
||||||||||||||||
| Basic |
$ | (1.30 | ) | $ | 0.74 | $ | (0.60 | ) | $ | 3.02 | ||||||
| Diluted |
$ | (1.30 | ) | $ | 0.66 | $ | (0.60 | ) | $ | 2.73 | ||||||
| Weighted average shares |
115,299,234 | 117,999,621 | 114,962,241 | 119,155,716 | ||||||||||||
| Weighted average shares and assumed incremental shares |
115,299,234 | 131,816,572 | 114,962,241 | 133,224,945 | ||||||||||||
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Consolidated Balance Sheets
(Unaudited, Dollars in Thousands)
| June 30, 2008 |
March 31, 2008 |
June 30, 2007 | |||||||
| Cash and cash equivalents |
$ | 433,493 | $ | 484,175 | $ | 910,304 | |||
| Finance receivables, net |
14,030,299 | 14,920,808 | 15,102,370 | ||||||
| Restricted cash – securitization notes payable |
982,670 | 1,009,890 | 1,014,353 | ||||||
| Restricted cash – credit facilities |
259,699 | 254,857 | 166,884 | ||||||
| Property and equipment, net |
55,471 | 58,282 | 58,572 | ||||||
| Leased vehicles, net |
210,857 | 217,342 | 33,968 | ||||||
| Deferred income taxes |
317,319 | 274,657 | 151,704 | ||||||
| Goodwill |
— | 212,595 | 208,435 | ||||||
| Other assets |
257,402 | 186,273 | 164,430 | ||||||
| Total assets |
$ | 16,547,210 | $ | 17,618,879 | $ | 17,811,020 | |||
| Credit facilities |
$ | 2,928,161 | $ | 3,418,571 | $ | 2,541,702 | |||
| Securitization notes payable |
10,420,327 | 10,882,696 | 11,939,447 | ||||||
| Senior notes |
200,000 | 200,000 | 200,000 | ||||||
| Convertible debt |
750,000 | 750,000 | 750,000 | ||||||
| Funding payable |
21,519 | 28,834 | 87,474 | ||||||
| Accrued taxes and expenses |
216,387 | 207,669 | 199,059 | ||||||
| Other liabilities |
113,946 | 145,333 | 18,188 | ||||||
| Total liabilities |
14,650,340 | 15,633,103 | 15,735,870 | ||||||
| Shareholders’ equity |
1,896,870 | 1,985,776 | 2,075,150 | ||||||
| Total liabilities and shareholders’ equity |
$ | 16,547,210 | $ | 17,618,879 | $ | 17,811,020 | |||
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Consolidated Statements of Cash Flows
(Unaudited, Dollars in Thousands)
| Three Months Ended June 30, | Fiscal Year Ended June 30, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Cash flows from operating activities: |
||||||||||||||||
| Net (loss) income |
$ | (150,213 | ) | $ | 86,855 | $ | (69,319 | ) | $ | 360,249 | ||||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
||||||||||||||||
| Depreciation and amortization |
28,796 | 12,712 | 87,479 | 36,737 | ||||||||||||
| Accretion and amortization of fees |
9,315 | 284 | 29,435 | (16,982 | ) | |||||||||||
| Provision for loan losses |
279,145 | 189,920 | 1,130,962 | 727,653 | ||||||||||||
| Deferred income taxes |
(66,930 | ) | (15,689 | ) | (137,949 | ) | (44,564 | ) | ||||||||
| Stock-based compensation expense |
2,543 | 5,855 | 17,945 | 20,230 | ||||||||||||
| Gain on sale of available for sale securities |
— | — | — | (51,997 | ) | |||||||||||
| Impairment of goodwill |
212,595 | — | 212,595 | — | ||||||||||||
| Other |
10,421 | (1,566 | ) | 16,319 | (4,241 | ) | ||||||||||
| Changes in assets and liabilities: |
||||||||||||||||
| Other assets |
3,299 | 3,139 | (38,524 | ) | 30,313 | |||||||||||
| Accrued taxes and expenses |
8,106 | 10,431 | 11,018 | 21,605 | ||||||||||||
| Net cash provided by operating activities |
337,077 | 291,941 | 1,259,961 | 1,079,003 | ||||||||||||
| Cash flows from investing activities: |
||||||||||||||||
| Purchase of receivables |
(784,543 | ) | (2,549,195 | ) | (6,260,198 | ) | (8,832,379 | ) | ||||||||
| Principal collections and recoveries on receivables |
1,378,773 | 1,631,640 | 6,108,690 | 5,884,140 | ||||||||||||
| Distributions from gain on sale Trusts |
— | 314 | 7,466 | 93,271 | ||||||||||||
| Net purchases of property and equipment |
(744 | ) | (2,333 | ) | (8,463 | ) | (11,604 | ) | ||||||||
| Net purchases of leased vehicles |
(6,377 | ) | (24,961 | ) | (198,826 | ) | (28,427 | ) | ||||||||
| Proceeds from sale of available for sale securities |
— | — | — | 62,961 | ||||||||||||
| Acquisition of LBAC, net of cash acquired |
— | — | — | (257,813 | ) | |||||||||||
| Net change in restricted cash and other |
(3,843 | ) | 155,066 | (102,802 | ) | (54,218 | ) | |||||||||
| Net cash provided (used) by investing activities |
583,266 | (789,469 | ) | (454,133 | ) | (3,144,069 | ) | |||||||||
| Cash flows from financing activities: |
||||||||||||||||
| Net change in credit facilities |
(490,811 | ) | (463,075 | ) | 385,611 | 232,895 | ||||||||||
| Net change in securitization notes payable |
(463,088 | ) | 1,053,048 | (1,524,035 | ) | 1,824,679 | ||||||||||
| Proceeds from issuance of senior notes |
— | 200,000 | — | 200,000 | ||||||||||||
| Net proceeds from issuance of convertible debt |
— | — | — | 497,376 | ||||||||||||
| Repurchase of common stock |
— | (90 | ) | (127,901 | ) | (324,054 | ) | |||||||||
| Proceeds from issuance of common stock |
11,123 | 10,293 | 25,174 | 58,157 | ||||||||||||
| Other net changes |
(25,100 | ) | (9,038 | ) | (39,024 | ) | (24,309 | ) | ||||||||
| Net cash (used) provided by financing activities |
(967,876 | ) | 791,138 | (1,280,175 | ) | 2,464,744 | ||||||||||
| Net (decrease) increase in cash and cash equivalents |
(47,533 | ) | 293,610 | (474,347 | ) | 399,678 | ||||||||||
| Effect of Canadian exchange rate changes on cash and cash equivalents |
(3,149 | ) | 1,299 | (2,464 | ) | (2,614 | ) | |||||||||
| Cash and cash equivalents at beginning of period |
484,175 | 615,395 | 910,304 | 513,240 | ||||||||||||
| Cash and cash equivalents at end of period |
$ | 433,493 | $ | 910,304 | $ | 433,493 | $ | 910,304 | ||||||||
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Other Financial Data
(Unaudited, Dollars in Thousands)
| Three Months Ended June 30, |
Fiscal Year Ended June 30, |
|||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Origination volume |
$ | 780,446 | $ | 2,511,528 | $ | 6,293,494 | $ | 8,454,600 | ||||||||
| Loans securitized |
920,250 | 2,764,683 | 4,634,083 | 7,659,927 | ||||||||||||
| Average on-book receivables |
$ | 15,446,441 | $ | 15,513,774 | $ | 16,059,129 | $ | 13,621,386 | ||||||||
| Average gain on sale receivables |
— | 26,483 | 7,107 | 105,831 | ||||||||||||
| Average managed receivables |
$ | 15,446,441 | $ | 15,540,257 | $ | 16,066,236 | $ | 13,727,217 | ||||||||
| June 30, 2008 |
March 31, 2008 |
June 30, 2007 |
||||||||||||||
| On-book receivables |
$ | 14,981,412 | $ | 15,820,314 | $ | 15,922,458 | ||||||||||
| Gain on sale receivables |
— | — | 24,091 | |||||||||||||
| Managed receivables |
$ | 14,981,412 | $ | 15,820,314 | $ | 15,946,549 | ||||||||||
| Three Months Ended June 30, |
Fiscal Year Ended June 30, |
|||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Operating expenses |
$ | 89,749 | $ | 106,681 | $ | 397,814 | $ | 398,434 | ||||||||
| Annualized operating expenses as a percent of average managed receivables |
2.3 | % | 2.8 | % | 2.5 | % | 2.9 | % | ||||||||
| Tax rate |
28.7 | % | 35.3 | % | 24.8 | % | 32.3 | % | ||||||||
| June 30, 2008 |
March 31, 2008 |
June 30, 2007 |
||||||||||||||
| Loan delinquency: |
||||||||||||||||
| On-book: |
||||||||||||||||
| (% of ending on-book receivables) |
||||||||||||||||
| 31 - 60 days |
6.0 | % | 5.3 | % | 4.7 | % | ||||||||||
| Greater than 60 days |
2.9 | 2.3 | 2.1 | |||||||||||||
| Total |
8.9 | % | 7.6 | % | 6.8 | % | ||||||||||
| Managed portfolio: |
||||||||||||||||
| (% of ending managed receivables) |
||||||||||||||||
| 31 - 60 days |
6.0 | % | 5.3 | % | 4.7 | % | ||||||||||
| Greater than 60 days |
2.9 | 2.3 | 2.1 | |||||||||||||
| Total |
8.9 | % | 7.6 | % | 6.8 | % | ||||||||||
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| Three Months Ended June 30, |
Fiscal Year Ended June 30, |
|||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Contracts receiving a payment deferral as an average quarterly percentage of average receivables outstanding: |
||||||||||||||||
| On-book (% of average on-book receivables) |
6.5 | % | 6.1 | % | 6.3 | % | 6.0 | % | ||||||||
| Managed portfolio (% of average managed receivables) |
6.5 | % | 6.0 | % | 6.3 | % | 6.0 | % | ||||||||
| Three Months Ended June 30, |
Fiscal Year Ended June 30, |
|||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Net charge-offs: |
||||||||||||||||
| On-book |
$ | 227,538 | $ | 127,960 | $ | 1,000,046 | $ | 638,094 | ||||||||
| Managed portfolio |
$ | 227,538 | $ | 128,051 | $ | 1,000,084 | $ | 643,059 | ||||||||
| Annualized net charge-offs as a percent of average receivables: |
||||||||||||||||
| On-book |
5.9 | % | 3.3 | % | 6.2 | % | 4.7 | % | ||||||||
| Managed portfolio |
5.9 | % | 3.3 | % | 6.2 | % | 4.7 | % | ||||||||
| Net recoveries as a percent of gross repossession charge-offs: |
||||||||||||||||
| On-book |
43.6 | % | 51.3 | % | 44.8 | % | 48.8 | % | ||||||||
| Managed portfolio |
43.6 | % | 51.3 | % | 44.8 | % | 48.8 | % | ||||||||
| June 30, 2008 |
March 31, 2008 |
June 30, 2007 |
||||||||||||||
| On-book receivables: |
||||||||||||||||
| Principal |
$ | 14,981,412 | $ | 15,820,314 | $ | 15,922,458 | ||||||||||
| Allowance for loan losses and nonaccretable acquisition fees |
(951,113 | ) | (899,506 | ) | (820,088 | ) | ||||||||||
| $ | 14,030,299 | $ | 14,920,808 | $ | 15,102,370 | |||||||||||
| Allowance as a percentage of on-book receivables |
6.3 | % | 5.7 | % | 5.2 | % | ||||||||||
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The Company’s net margin as reflected on the consolidated statement of operations is as follows:
| Three Months Ended June 30, |
Fiscal Year Ended June 30, |
|||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Finance charge income |
$ | 562,184 | $ | 591,792 | $ | 2,382,484 | $ | 2,142,470 | ||||||||
| Other income |
36,216 | 33,247 | 159,779 | 136,093 | ||||||||||||
| Interest expense |
(204,034 | ) | (194,884 | ) | (837,412 | ) | (680,825 | ) | ||||||||
| Net margin |
$ | 394,366 | $ | 430,155 | $ | 1,704,851 | $ | 1,597,738 | ||||||||
| Three Months Ended June 30, |
Fiscal Year Ended June 30, |
|||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
| Finance charge income |
14.6 | % | 15.3 | % | 14.8 | % | 15.7 | % | ||||||||
| Other income |
0.9 | 0.8 | 1.0 | 1.0 | ||||||||||||
| Interest expense |
(5.3 | ) | (5.0 | ) | (5.2 | ) | (5.0 | ) | ||||||||
| Annualized net margin as a percent of average on-book receivables |
10.2 | % | 11.1 | % | 10.6 | % | 11.7 | % | ||||||||
The following is a reconciliation of the Company’s quarterly pre-tax income excluding goodwill impairment and restructuring charges to the Company’s loss before income taxes as reflected on the Company’s consolidated statement of operations (in thousands):
| Three Months Ended June 30, 2008 |
Fiscal Year Ended June 30, 2008 |
|||||||
| Pre-tax income, excluding goodwill impairment and restructuring charges |
$ | 13,234 | $ | 140,532 | ||||
| Less goodwill impairment |
(212,595 | ) | (212,595 | ) | ||||
| Less restructuring charges |
(11,259 | ) | (20,116 | ) | ||||
| Loss before income taxes |
$ | (210,620 | ) | $ | (92,179 | ) | ||
Contact:
| Caitlin DeYoung | Deborah Vestal | |
| (817) 302-7394 | (817) 302-7210 |
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