Consumer Portfolio Services, Inc. Q2 FY2024 earnings call

• Charles Bradley noted the quarter was good with a transition from watchful waiting to growth, expecting credit to turn in 6-9 months and starting to grow with 25% QoQ and 36% YoY growth. - Danny Bharwani discussed revenues driven by originations growth and mark to finance receivables, expenses including reversal of provision for losses on legacy portfolio and increase in interest expense, and financial metrics like pretax and net income. - Mike Lavin highlighted originations with 310,000 apps in Q2 2024 (10% increase YoY), 14 new sales reps hired, expansion of large dealer groups to 99, growth in dealer loyalty, capture percentage, and funding time, improved risk profile with higher APR, FICO, and lower LTVs, portfolio performance with DQ >30 days at 13.29% (up from last year), charge-offs at 7.2% (up from last year), and progress with AI technologies like conversational AI voice bot and document processing AI bot. - Charles Bradley mentioned industry position, focus on growth, and preparation for declining interest rates.

Revenues for the second quarter were $95.9 million, a 5% increase over the previous quarter and a 13% increase over the second quarter last year. For the six months, revenues were $187.6 million, a 12% increase over the prior year. Originations in the second quarter were $431.9 million, a 25% increase from the first quarter and a 36% increase from the second quarter last year. Expenses for the quarter were $89.2 million, a 5% increase over the previous quarter and a 33% increase over the second quarter last year for the six months. Pretax income was $6.7 million for the quarter, comparable to the previous quarter but down from last year. Net income was $4.7 million for the quarter, down from last year. Finance receivables at fair value were $2.960 billion, a 6% increase from the first quarter and a 13% increase from last year. Shareholders' equity was a record high of $280.3 million, a 10% increase from last year.

• Management is waiting for interest rates to potentially go down towards the end of the year. - Focus is on being in a growth position to take advantage of declining interest rates when they occur, with efforts to ensure good credit and be ready to fund lots of loans as rates drop.

• Credit performance risks as they continue to monitor the portfolio. - Interest rate changes could impact interest expense. - Competition in the industry which could affect market position.

Q: Operator concludes the call and mentions replay availability.

A: Operator thanks everyone and states the replay will be available beginning two hours from now for 12 months via the company’s website at www.consumerportfolio.com, then instructs to disconnect lines