TORONTO, Nov. 28, 2019 /CNW/ - Axis Auto Finance Inc.
("Axis" or the "Company"), (TSXV: AXIS) Canada's fastest growing publicly-traded
sub-prime automotive finance company, today announced financial
results for the first quarter of fiscal 2020 ending September 30, 2019. In the quarter, Axis adopted
IFRS 16, the new accounting pronouncement which amends the
accounting treatment for operating leases. The Company also made
the decision to report non-IFRS measures of portfolio yield, credit
losses, and interest expense based on gross finance receivable
balances as opposed to based on net balances as was the case
previously.
HIGHLIGHTS
- Record quarterly originations of $19.3
million;
- Record quarterly revenues of $9.0
million, a 14% increase over Q4 2019;
- Record gross finance receivables of $117.6 million, up from $114.7 million in fiscal 2019;
- Average portfolio yield of 32.9%, in line with 33.0% in 2019;
and
- Adjusted earnings 1 of $0.5 million for Q1 2020.
Originations for the first quarter of fiscal 2020 were
$19.3 million, as compared to
$18.3 million in the first quarter
2019, the result of sustained penetration in existing markets and
expansion into new markets that Axis entered in the second half of
fiscal 2019.
The increase in originations contributed to the growth in gross
finance receivables, which increased from $114.7 million at June 30,
2019 to $117.6 million at the
end of the first quarter of fiscal 2020.
First quarter revenues were a record $9.0
million, a 6.6% increase from $8.4
million for the first quarter of fiscal 2019 and a 14%
increase from Q4 of fiscal 2019. The increase in revenue is the
result of portfolio growth and maintaining strong portfolio yields
on newly originated finance receivables.
Portfolio yields in the first quarter 2020 remained strong at
32.9%, in line with both first quarter of fiscal 2019 and the full
fiscal 2019, which produced yields of 33.0%.
Annualized credit losses rose from 9.41% in fiscal 2019 to
10.47% in the first quarter of fiscal 2020. Delinquency at the end
of the first quarter of fiscal 2020 was 5.72%, down from 7.06% for
the comparative period in fiscal 2019.
Adjusted earnings (loss) for Q1 2020 was $0.5 million, compared to ($0.5) million in Q4 2019 and $1.7 million for Q1 2019.
Net income (loss) for Q1 2020 was ($0.5)
million or ($0.006) per share,
as compared to ($0.3) million or
($0.004) per share in Q1 2019.
Book value of the Company was $34.1
million at the end of the first quarter of fiscal 2020, or
$0.35 per share.
About Axis Auto Finance
Axis Auto Finance is a leading Canadian provider of alternative
used vehicle financing options servicing roughly 30% of Canadians
(Source: Equifax) that have credit scores in the non-prime range.
100% of all Axis auto loans report to the credit bureau, resulting
in a significant improvement of the credit scores for the
overwhelming majority of clients. These clients use Axis as a
stepping-stone in their credit rebuilding journey and we are proud
to be improving the lives of these Canadians. Supported by
state-of-the-art, in-house developed risk analytics, Axis continues
to be Canada's fastest-growing
publicly traded auto-financing company. Further information on the
Company can be found at investors.axisautofinance.ca/.
1 In order to track the performance of its
finance receivable portfolio in a given period without the
volatility associated with estimates and assumptions, Axis
introduced a non-IFRS measure called Adjusted Earnings. This
measure, now included in the MD&A, is equal to the net income
(loss) for the period, adjusted for (i) non-cash expense items (as
identified in the Statement of Cash Flows) (ii) actual credit
losses incurred (iii) non-recurring one time transaction and
integration costs (iv) occupancy related lease costs not
included in general and administrative expenses and (v)
specified expenses which were entirely recognized in a given
quarter but for which the benefit was derived over more than a
given quarter. For further information on Axis non-IFRS
measures, please see the Management's Discussion and Analysis for
the corresponding period.
The TSX Venture Exchange has neither approved nor disapproved
the contents of this press release. Neither the Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the Exchange) accepts responsibility for the adequacy
or accuracy of this release.
SOURCE Axis Auto Finance Inc.