Consumer Portfolio Services Inc. Reports Third Quarter Net Earnings.Business Editors IRVINE Irvine, town, Scotland Irvine (ûr`vĭn), town (1991 pop. 32,507), North Ayrshire, SW Scotland, on the Irvine River estuary. Industries include iron and brass foundries. Other products are chemicals, electric goods, and clothing. , Calif.--(BUSINESS WIRE)--Oct. 29, 2001 Consumer Portfolio Services Inc. (Nasdaq:CPSS CPSS Committee on Payment and Settlement Systems CPSS Commission on Public Secondary Schools CPSS Cincinnati Prehospital Stroke Scale (STR - Smile, Talk, Raise both arms) CPSS Certified Professional Soil Scientist ), today announced net earnings for its third quarter ended Sept. 30, 2001. Net earnings for the quarter ended Sept. 30, 2001 were $253,000, or $0.01 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared with a net loss of $1.2 million, or ($0.06) per diluted share, for the quarter ended Sept. 30, 2000. Diluted shares outstanding were 21.1 million and 20.3 million for the quarters ending Sept. 30, 2001 and 2000, respectively. Quarter over quarter revenues for the three months ended Sept. 30, 2001 and 2000 were unchanged at approximately $14.3 million for each of the periods. For the nine months ended Sept. 30, 2001, net earnings were $680,000, or $0.03 per diluted share, compared with a net loss of $15.5 million, or ($0.76) per diluted share, for the year earlier period. Diluted shares outstanding were 21.2 million and 20.3 million for the nine-month periods ending Sept. 30, 2001 and 2000, respectively. Revenues for the nine months ended Sept. 30, 2001 totaled $47.9 million, compared with revenues of $28.2 million for the period ending Sept. 30, 2000. Purchases of contracts from automobile dealers during the quarter ended Sept. 30, 2001 increased by $2.0 million, or 1.3%, to $158.4 million from $156.4 million for the third quarter of 2000. During the three-month period ended Sept. 30, 2001, the company sold $158.1 million of contracts, compared with $156.4 million for the same period in the prior year, an increase of 1.1%. Additionally, on Sept. 7, 2001 the company completed the CPS (1) (Characters Per Second) The measurement of the speed of a serial printer or the speed of a data transfer between hardware devices or over a communications channel. CPS is equivalent to bytes per second. Auto Receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed Trust 2001-A Securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. , thereby issuing Class A-1 and Class A-2 Notes aggregating $68.5 million. This transaction represents the first term securitization completed by Consumer Portfolio Services since the fourth quarter of 1998. The aggregate outstanding balance of contracts serviced by the company at Sept. 30, 2001 was $318.1 million, compared with $490.0 million at Sept. 30, 2000. Balances of accounts past due over 30 days represented 5.0% of the servicing portfolio at Sept. 30, 2001, compared with 5.1% at Sept. 30, 2000. The annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. net charge-off Eliminate or write off. The term charge-off is used to describe the process of removing from the records of a company something that was once regarded as an asset but has subsequently become worthless. rate for the three-month period ended Sept. 30, 2001 was 6.0%, compared with 9.7% for the three-month period ended Sept. 30, 2000, a decrease of 38.1%. The inventory of repossessed vehicles was 1.7% of the servicing portfolio as of Sept. 30, 2001, compared with 2.0% at Sept. 30, 2000. "We continue to achieve the goals that we set forth at the beginning of 2001. Our first task was to achieve profitability, which we have now done for three consecutive quarters. "Our second was to complete a term securitization representing the return of CPS to the securitization market, which was accomplished in the third quarter. These achievements are significant steps in returning CPS to a prominent position in our industry," said Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by E. Bradley, president and chief executive officer of Consumer Portfolio Services. Consumer Portfolio Services purchases, sells and services retail installment sales Installment sale The sale of an asset in exchange for a specified series of payments (the installments). installment sale A sale in which the buyer is scheduled to make a series of payments over a period of time. contracts originated predominantly pre·dom·i·nant adj. 1. Having greatest ascendancy, importance, influence, authority, or force. See Synonyms at dominant. 2. by franchised dealers for new and late model used cars. The company finances automobile purchases through more than 4,000 dealers under contract throughout the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. in this news release include the company's recorded gain on sale 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 relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the economy generally) the following: possible increased delinquencies, repossessions and losses on retail installment contracts installment contract n. an agreement in which payments of money, delivery of goods or performance of services are to be made in a series of payments, deliveries or performances, usually on specific dates or upon certain happenings. ; incorrect prepayment speed Prepayment speed Also called speed, the estimated rate at which mortgagors pay off their loans ahead of schedule, critical in assessing the value of mortgage pass-through securities. and/or discount rate assumptions, possible unavailability un·a·vail·a·ble adj. Not available, accessible, or at hand. un  a·vail of qualified personnel, which could adversely affect the
company's ability to service its portfolio; possible increases in
the rate of consumer bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most filings or 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.
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Consumer Portfolio Services Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three months ended Nine months ended
Sept. 30, Sept. 30,
2001 2000 2001 2000
Revenues:
Gain on sale of
contracts, net $ 7,441 $ 4,787 $ 25,933 $ 12,628
Interest
income 3,909 5,648 13,222 2,483
Servicing fees 2,676 3,585 7,884 12,969
Other income 245 236 877 100
14,271 14,256 47,916 28,180
Expenses:
Employee costs 5,055 6,339 17,925 18,716
General and
administrative 3,205 2,684 9,871 10,697
Interest 3,258 4,241 11,016 13,011
Other expenses 2,500 2,483 8,304 7,950
14,018 15,747 47,116 50,374
Earnings (loss)
before income
tax expense
(benefit) 253 (1,491) 800 (22,194)
Income tax
expense
(benefit) - (313) 120 (6,733)
Net earnings
(loss) $ 253 $ (1,178) $ 680 $(15,461)
Earnings (loss)
per share:
Basic $ 0.01 $ (0.06) $ 0.03 $ (0.76)
Diluted 0.01 (0.06) 0.03 (0.76)
Number of shares
used in computing
earnings (loss)
per share:
Basic 19,790 20,311 19,567 20,258
Diluted 21,112 20,311 21,163 20,258
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
Sept. 30, Dec. 31,
2001 2000
Cash and restricted cash $ 14,473 $ 24,315
Contracts held for sale 2,612 18,830
Residual interest in securitizations 107,613 99,199
Other assets 28,598 33,350
-------------- --------------
$ 153,296 $ 175,694
Accounts payable and other liabilities $ 10,901 $ 16,373
Senior secured debt 26,000 38,000
Subordinated debt 54,514 59,199
91,415 113,572
Shareholders' equity 61,881 62,122
$ 153,296 $ 175,694
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