QC Holdings, Inc. Reports First Quarter 2018 Results
07 June 2018 - 9:00AM
QC Holdings, Inc. (OTC PINK:QCCO) reported a net loss of $114,000
and revenues of $24.1 million for the quarter ended March 31, 2018.
Net income totaled $365,000 and revenues totaled $23.4 million for
the quarter ended March 31, 2017.
The 3% improvement in revenues during first quarter 2018
compared to 2017 was primarily attributable to an increase in new
and returning customers, as well as to an uptick in installment
loan activity.
Loan loss rates increased during first quarter 2018 compared to
2017. This increase was primarily attributable to
approximately $1.0 million in first quarter 2017 cash recoveries
from the business-to-business portfolio and from branches that were
closed at the end of 2016.
About QC Holdings, Inc.Headquartered in
Overland Park, Kansas, QC Holdings, Inc. is a leading provider of
consumer loans in the United States and Canada. In the United
States, QC offers various products, including single-pay,
installment and title loans, check cashing, debit cards and money
transfer services, through 255 branches in 14 states at March 31,
2018. In Canada, the company, through its subsidiary Direct Credit
Holdings Inc., is engaged in short-term, consumer internet lending
in various provinces.
Forward Looking Statement Disclaimer: This press release
contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on the company’s current
expectations and are subject to many risks and uncertainties, which
could cause actual results to differ materially from those
forward-looking statements. These risks include (1) changes in laws
or regulations or governmental interpretations of existing laws and
regulations governing consumer protection or short-term lending
practices, (2) uncertainties relating to the interpretation,
application and promulgation of regulations under the Dodd-Frank
Wall Street Reform and Consumer Protection Act, including the
impact of announced regulations by the Consumer Financial
Protection Bureau (CFPB), (3) ballot referendum initiatives by
industry opponents to cap the rates and fees that can be charged to
customers, (4) uncertainties related to the examination process by
the CFPB and indirect rulemaking through the examination process,
(5) litigation or regulatory action directed towards us or the
short-term consumer loan industry, (6) volatility in our earnings,
primarily as a result of fluctuations in loan loss experience and
closures of branches, (7) risks associated with our dependence on
cash management banking services and the Automated Clearing House
for loan collections, (8) negative media reports and public
perception of the short-term consumer loan industry and the impact
on federal and state legislatures and federal and state regulators,
(9) changes in our key management personnel, (10) risks associated
with owning and managing non-U.S. businesses, and (11) other
various risks. QC will not update any forward-looking statements
made in this press release to reflect future events or
developments.
(Financial and Statistical Information
Follows)
QC Holdings,
Inc.Consolidated Condensed Statements of
Operations(in thousands, except per share
amounts)(Unaudited)
|
Quarter Ended |
|
March 31, |
|
2017 |
2018 |
Revenues |
|
|
|
Consumer
loan interest and fees |
$ |
21,157 |
|
$ |
21,808 |
|
Other |
|
2,261 |
|
|
2,293 |
|
Total
revenues |
|
23,418 |
|
|
24,101 |
|
Provision for
losses |
|
3,270 |
|
|
5,223 |
|
Operating expenses |
|
12,554 |
|
|
12,346 |
|
Gross
profit |
|
7,594 |
|
|
6,532 |
|
|
|
|
|
Corporate and Regional
expenses |
|
6,269 |
|
|
5,805 |
|
Other expense, net |
|
819 |
|
|
789 |
|
Income
(loss) before income taxes |
|
506 |
|
|
(62 |
) |
Provision for income
taxes |
|
141 |
|
|
52 |
|
Net income (loss) |
$ |
365 |
|
$ |
(114 |
) |
|
|
|
|
|
|
|
Income (loss)
per share: |
|
|
|
Basic |
|
|
|
Net
income (loss) |
$ |
0.02 |
|
$ |
(0.01 |
) |
|
|
|
|
|
|
|
Diluted |
|
|
|
Net
income (loss) |
$ |
0.02 |
|
$ |
(0.01 |
) |
Weighted
average number of common shares outstanding: |
|
|
|
|
|
|
Basic |
|
17,333 |
|
|
17,333 |
|
Diluted |
|
17,333 |
|
|
17,333 |
|
|
|
|
|
|
|
|
|
|
QC Holdings,
Inc.Consolidated Condensed Balance
Sheets(in thousands)
|
December 31, |
|
March 31, |
|
2017 |
|
2018 |
ASSETS |
|
|
|
(Unaudited) |
Current assets |
|
|
|
Cash and
cash equivalents |
$ |
16,198 |
|
$ |
21,926 |
Restricted cash |
|
1,879 |
|
|
1,873 |
Loans
receivable, less allowance for losses of $7,755 at December 31,
2017 and $7,124 at March 31, 2018 |
|
32,921 |
|
|
26,614 |
Other
current assets |
|
3,748 |
|
|
3,619 |
Total
current assets |
|
54,746 |
|
|
54,032 |
Non-current loans
receivable, less allowance for losses of $83 at December 31, 2017
and $60 at March 31, 2018 |
|
258 |
|
|
202 |
Property and equipment,
net |
|
8,241 |
|
|
8,416 |
Other assets, net |
|
7,313 |
|
|
7,169 |
Total
assets |
$ |
70,558 |
|
$ |
69,819 |
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities |
|
|
|
Accounts
payable and other current liabilities |
$ |
9,355 |
|
$ |
9,249 |
Revolving
credit facility |
|
2,500 |
|
|
2,495 |
Subordinated debt |
|
8,168 |
|
|
7,744 |
Total
current liabilities |
|
20,023 |
|
|
19,488 |
|
|
|
|
Non-current
liabilities |
|
4,471 |
|
|
4,402 |
Total
liabilities |
|
24,494 |
|
|
23,890 |
|
|
|
|
Stockholders’
equity |
|
46,064 |
|
|
45,929 |
Total
liabilities and stockholders’ equity |
$ |
70,558 |
|
$ |
69,819 |
|
|
|
|
QC Holdings,
Inc.Consolidated Condensed Statements of Cash
Flows(in
thousands)(Unaudited)
|
Quarter Ended |
|
Quarter Ended |
|
March 31, 2017 |
|
March 31, 2018 |
|
|
|
|
Operating
activities: |
|
|
|
Net
income (loss) |
$ |
365 |
|
|
$ |
(114 |
) |
Adjustments to reconcile net income (loss) to net cash |
|
4,202 |
|
|
|
6,152 |
|
Changes
in assets and liabilities |
|
5,441 |
|
|
|
1,060 |
|
Net
operating |
|
10,008 |
|
|
|
7,098 |
|
|
|
|
|
|
|
|
|
Investing
activities: |
|
|
|
Capital
expenditures |
|
(838 |
) |
|
|
(861 |
) |
Other |
|
1 |
|
|
|
- |
|
Net
investing |
|
(837 |
) |
|
|
(861 |
) |
|
|
|
|
|
|
|
|
Financing
activities: |
|
|
|
|
|
|
|
Net
repayment of borrowings |
|
|
|
(500 |
) |
Other |
|
- |
|
|
|
- |
|
Net
financing |
|
- |
|
|
|
(500 |
) |
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash |
|
32 |
|
|
|
(15 |
) |
|
|
|
|
|
|
|
|
Net increase in cash,
cash equivalents and restricted cash |
|
9,203 |
|
|
|
5,722 |
|
Cash, cash equivalents
and restricted cash at beginning of year |
|
18,525 |
|
|
|
18,077 |
|
Cash, cash equivalents
and restricted cash at end of period |
$ |
27,728 |
|
|
$ |
23,799 |
|
|
|
|
|
|
|
|
|
Contact:Douglas E. Nickerson (913-234-5154)Chief Financial
Officer
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