WORLD ACCEPTANCE CORP Q4 FY2025 earnings call

• Ledger decreased by 4% y/y but customer base increased by 3.5%. Average balance per customer down 7.3% y/y. Gross yields improved over 100 basis points.
• Delinquency and charge-off rates discussed, with part due to portfolio shrinkage and new customer growth. Newest customers (less than 6 months tenure) up 36% y/y, $32M increase.
• Fourth quarter tax return revenue up 25% ($7M). Fourth quarter EPS benefited from $2.8M after-tax accrual release of share-based comp expense (~$0.38 per share).
• Non-refinance loan volume up 12.6% y/y, refinance up 3% y/y, with refinance volume rebounding in April 2026. Portfolio shifting towards small loans.
• New customer marketing and acquisition channel adjustments improved approval rates by ~50% Q3-Q4 2025 vs 2024. Pilot of World finance credit card internally at end of March 2024.

Outstanding ledger ended at $1.22 billion, a 4% decrease year-over-year. Customer base increased by 3.5%, marking the first year of year-over-year customer growth since fiscal year 2022. Average balance per customer decreased 7.3% year-over-year. Gross yields improved by over 100 basis points. Non-refinance loan volume increased by 12.6% year-over-year, while refinance loan volume improved slightly by 3% year-over-year. The portfolio shifted towards small loans, reducing large loans from nearly 60% of the portfolio two years ago to 48% at the end of fiscal year 2025.

• Expect average balance to right size in upcoming fiscal year.
• New customer growth has an impact on delinquency rates, but optimistic about improved trading and delinquency management for fiscal 2026.

• Sticky delinquency and charge-off rates stubborn to return to normal levels. Partly due to portfolio shrinkage and new customer growth impacting delinquency rates.

Q: Any shift in consumer behavior since mid-late February due to tariff noise?

A: Haven't seen significant increase/decrease in demand or change in payments.

Q: Portfolio mix shift to smaller loans: underwriting, consumer demand, or customer mix shift?

A: More of a return to World's roots, focusing on small loan customers rather than customer demand.

Q: Driver of tax prep revenue growth?

A: Increased prices with little reduction in demand during tax season, leading to 25% revenue increase.

Q: Reason for insurance and other income increase?

A: Driven by tax prep revenue.

Q: Reason allowance was down sequentially?

A: Largely due to runoff of the portfolio.

Q: Expectations for share repurchases going forward?

A: Probably more than done this year, with considerations around bank negotiations and bond repurchase limits capped at 50% of consolidated net income.