-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, B/vJqLBfekxfFUVPVs4j7+uWJEAWcggWo6rxHYodmtAFnkLL+Ko24jpihEkRhjxs RGOyXttfeiXe8pdCv7gJ7Q== 0001019687-08-001693.txt : 20080416 0001019687-08-001693.hdr.sgml : 20080416 20080416130442 ACCESSION NUMBER: 0001019687-08-001693 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20080415 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20080416 DATE AS OF CHANGE: 20080416 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONSUMER PORTFOLIO SERVICES INC CENTRAL INDEX KEY: 0000889609 STANDARD INDUSTRIAL CLASSIFICATION: FINANCE SERVICES [6199] IRS NUMBER: 330459135 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14116 FILM NUMBER: 08759327 BUSINESS ADDRESS: STREET 1: 16355 LAGUNA CANYON CITY: IRVINE STATE: CA ZIP: 92618 BUSINESS PHONE: 9497536800 MAIL ADDRESS: STREET 1: 16355 LAGUNA CANYON ROAD CITY: IRVINE STATE: CA ZIP: 92618 8-K 1 cps_8k-041508.txt CURRENT REPORT ON FORM 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 ------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) April 15, 2008 CONSUMER PORTFOLIO SERVICES, INC. --------------------------------- (Exact Name of Registrant as Specified in Charter) CALIFORNIA 0-51027 33-0459135 ---------- --------- ---------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 16355 Laguna Canyon Road, Irvine, CA 92618 ------------------------------------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code (949) 753-6800 Not Applicable -------------- (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] 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. The information in this Item 2.02, and the related Exhibit 99.1, is being furnished and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended. On April 15, 2008, the registrant issued a news release announcing its earnings for the quarter ended March 31, 2008. A copy of the release is attached as Exhibit 99.1. The registrant also announced that it will hold its regular quarterly conference call on April 16, 2008 at 1:30 p.m. eastern time to discuss its quarterly earnings. Those wishing to participate by telephone may dial in at 973-582-2717 approximately 10 minutes prior to the scheduled time. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (d) Exhibits. Exhibit Number Description -------------- ----------- 99.1 News Release dated April 15, 2008 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CONSUMER PORTFOLIO SERVICES, INC. Dated: April 16, 2008 By: /s/ Jeffrey P. Fritz -------------------------------------- Jeffrey P. Fritz Sr. Vice President and Chief Financial Officer Signing on behalf of the registrant and as principal financial officer EXHIBIT INDEX Exhibit Number Description - -------------- ----------- 99.1 News Release dated April 15, 2008 EX-99.1 2 cps_8k-ex9901.txt EXHIBIT 99.1 Exhibit 99.1 NEWS RELEASE - -------------------------------------------------------------------------------- CONSUMER PORTFOLIO SERVICES, INC. REPORTS 2008 FIRST QUARTER EARNINGS IRVINE, CALIFORNIA, APRIL 15, 2008 (BUSINESS WIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) ("CPS" or the "Company") today announced earnings for its first quarter ended March 31, 2008. Total revenues for the first quarter of 2008 increased approximately $16.8 million, or 19.4%, to $103.3 million, compared to $86.5 million for the first quarter of 2007. Total operating expenses for the first quarter of 2008 were $99.5 million, an increase of $18.4 million, or 22.7%, as compared to $81.1 million for the 2007 period. Pretax income for the first quarter of 2008 decreased to $3.8 million, compared to pretax income of $5.4 million for the first quarter of 2007. Net income for the first quarter of 2008 was $2.1 million, or $0.11 per diluted share, compared to net income of $3.2 million, or $0.14 per diluted share, for the year-ago quarter. During the first quarter of 2008, CPS purchased $176.1 million of contracts from dealers as compared to $265.8 million during the fourth quarter of 2007 and $330.3 million during the first quarter of 2007. The Company's managed receivables totaled $2,092.1 million as of March 31, 2008, an increase of $365.4 million, or 21.2%, from $1,726.7 million as of March 31, 2007, as follows ($ in millions):
Originating Entity March 31, 2008 March 31, 2007 - ------------------ -------------- -------------- CPS $2,028.8 $1,658.9 TFC 62.6 62.4 MFN 0.0 0.1 SeaWest 0.5 3.1 As Third Party Servicer for SeaWest Financial 0.2 2.2 -------- -------- Total $2,092.1 $1,726.7
Subsequent to quarter end, the Company completed its first securitization since September of last year with the sale of $244.4 million of triple A rated asset-backed notes. Annualized net charge-offs during the March 2008 quarter were 6.66% of the average owned portfolio as compared to 5.12% during the 2007 quarter. Delinquencies greater than 30 days (including repossession inventory) were 4.82% of the total owned portfolio as of March 31, 2008, as compared to 3.55% as of March 31, 2007. "While our financial results for the first quarter of 2008 were not immune to the ongoing capital markets turbulence and economic slowdown, we are pleased to have been able to continue to build the equity base of the Company," said Charles E. Bradley, Jr., Chief Executive Officer. "In addition, with the completion of our securitization last week, we have significant borrowing capacity available under our warehouse credit facilities. As a result of the credit tightening changes and price increases we have implemented over the last six months, we should be well positioned once the capital markets stabilize." Page 1 of 2 CONFERENCE CALL CPS announced that it will hold a conference call tomorrow, April 16, 2008, at 1:30 p.m. ET to discuss its quarterly earnings. Those wishing to participate by telephone may dial-in at 973-582-2717 approximately 10 minutes prior to the scheduled time. A replay will be available between April 16, 2008 and April 23, 2008, beginning one hour after conclusion of the call, by dialing 800-642-1687 or 706-645-9291 for international participants, with pin number 43172900. A broadcast of the conference call will also be available live and for 30 days after the call via the Company's web site at www.consumerportfolio.com and at www.streetevents.com. ABOUT CONSUMER PORTFOLIO SERVICES, INC. Consumer Portfolio Services, Inc. is a specialty finance company engaged in purchasing and servicing new and used retail automobile contracts originated primarily by franchised automobile dealerships and to a lesser extent by select independent dealers of used automobiles in the United States. We serve as an alternative source of financing for dealers, facilitating sales to sub-prime customers, who have limited credit history, low income or past credit problems and who otherwise might not be able to obtain financing from traditional sources. FORWARD-LOOKING STATEMENTS IN THIS NEWS RELEASE INCLUDE THE COMPANY'S RECORDED REVENUE, EXPENSE AND PROVISION FOR CREDIT LOSSES, BECAUSE THESE ITEMS ARE DEPENDENT ON THE COMPANY'S ESTIMATES OF FUTURE LOSSES. THE ACCURACY OF SUCH ESTIMATES MAY BE ADVERSELY AFFECTED BY VARIOUS FACTORS, WHICH INCLUDE (IN ADDITION TO RISKS RELATING TO THE ECONOMY GENERALLY) THE FOLLOWING: POSSIBLE INCREASED DELINQUENCIES; REPOSSESSIONS AND LOSSES ON RETAIL INSTALLMENT CONTRACTS; INCORRECT PREPAYMENT SPEED AND/OR DISCOUNT RATE ASSUMPTIONS; POSSIBLE UNAVAILABILITY OF QUALIFIED PERSONNEL, WHICH COULD ADVERSELY AFFECT THE COMPANY'S ABILITY TO SERVICE ITS PORTFOLIO; POSSIBLE INCREASES IN THE RATE OF CONSUMER BANKRUPTCY FILINGS OR THE EFFECTS OF RECENT CHANGES IN BANKRUPTCY LAW, WHICH COULD ADVERSELY AFFECT THE COMPANY'S RIGHTS TO COLLECT PAYMENTS FROM ITS PORTFOLIO; OTHER CHANGES IN GOVERNMENT REGULATIONS AFFECTING CONSUMER CREDIT; POSSIBLE DECLINES IN THE MARKET PRICE FOR USED VEHICLES, WHICH COULD ADVERSELY AFFECT THE COMPANY'S REALIZATION UPON REPOSSESSED VEHICLES; AND ECONOMIC CONDITIONS IN GEOGRAPHIC AREAS IN WHICH THE COMPANY'S BUSINESS IS CONCENTRATED. ALL OF SUCH FACTORS ALSO MAY AFFECT THE COMPANY'S FUTURE EARNINGS, AS TO WHICH THERE CAN BE NO ASSURANCE. ANY IMPLICATION THAT THE RESULTS OF THE MOST RECENTLY COMPLETED QUARTER ARE INDICATIVE OF FUTURE RESULTS IS DISCLAIMED, AND THE READER SHOULD DRAW NO SUCH INFERENCE. FACTORS SUCH AS THOSE IDENTIFIED ABOVE IN RELATION TO PROVISION FOR CREDIT LOSSES MAY AFFECT FUTURE PERFORMANCE. INVESTOR RELATIONS CONTACTS Consumer Portfolio Services, Inc. Robert E. Riedl 949-753-6800 Erica Waldow 888-505-9200 Page 2 of 2 CONSUMER PORTFOLIO SERVICES, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three months ended March 31, --------------------- 2008 2007 -------- -------- REVENUES: Interest income $ 99,362 $ 80,490 Servicing fees 428 282 Other income 3,511 5,723 -------- -------- 103,301 86,495 -------- -------- EXPENSES: Employee costs 13,482 10,804 General and administrative 7,346 5,969 Interest 39,034 29,505 Provision for credit losses 34,909 29,489 Other expenses 4,756 5,318 -------- -------- 99,527 81,085 -------- -------- Income before income taxes 3,774 5,410 Income taxes 1,660 2,179 -------- -------- Net income $ 2,114 $ 3,231 ======== ======== Earnings per share: Basic $ 0.11 $ 0.15 Diluted 0.11 0.14 Number of shares used in computing earnings per share: Basic 19,297 21,526 Diluted 19,973 23,718 CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) (UNAUDITED) March 31, December 31, 2008 2007 ----------- ----------- Cash $ 18,508 $ 20,880 Restricted cash 176,646 170,341 ----------- ----------- Total Cash 195,154 191,221 Finance receivables 2,026,726 2,068,004 Allowance for finance credit losses (94,833) (100,138) ----------- ----------- Finance receivables, net 1,931,893 1,967,866 Residual interest in securitizations 1,868 2,274 Deferred tax assets, net 58,845 58,835 Other assets 60,191 62,617 ----------- ----------- $ 2,247,951 $ 2,282,813 =========== =========== Accounts payable and other liabilities $ 35,575 $ 36,097 Warehouse lines of credit 367,955 235,925 Residual interest financing 90,000 70,000 Securitization trust debt 1,610,649 1,798,302 Subordinated debt 28,405 28,134 ----------- ----------- 2,132,584 2,168,458 ----------- ----------- Shareholders' equity 115,367 114,355 ----------- ----------- $ 2,247,951 $ 2,282,813 =========== ===========
OPERATING AND PERFORMANCE DATA ($ IN THOUSANDS) At and for the Three months ended March 31, ---------------------------- 2008 2007 --------- --------- Contract purchases 176,090 330,273 Total managed portfolio 2,092,094 1,726,744 Average managed portfolio 2,112,686 1,665,891 Net interest margin (1) 60,328 50,985 Risk adjusted margin (2) 25,419 21,496 Core operating expenses (3) 25,584 22,091 Annualized % of average managed portfolio 4.84% 5.30% Annualized return on managed assets (4) 0.71% 1.30% Allowance for finance credit losses as % of fin. receivables 4.68% 4.84% Aggregate allowance as % of fin. receivables (5) 5.83% 5.90% Delinquencies 31+ Days 2.92% 2.10% Repossession Inventory 1.90% 1.44% Total Delinquencies and Repossession Inventory 4.82% 3.55% Annualized net charge-offs as % of average owned portfolio 6.66% 5.12%
(1) Interest income less interest expense. (2) Net interest margin less provision for credit losses. (3) Total expenses less interest and provision for credit losses. (4) Pretax income divided by average managed portfolio. (5) Includes allowance for finance credit losses and allowance for repossession inventory. -----END PRIVACY-ENHANCED MESSAGE-----