Preliminary Financial Results - First Quarter 2024
Based upon management's current expectations, the Company will report Total Revenue, Annualized Net Charge-Off Rate, 30+ Day Delinquency Rate, Net Loss, Adjusted EBITDA and Adjusted Net Income, for the first quarter as follows:
Metric | Preliminary | Guidance | ||
1Q24 | 1Q24 | 1Q23 | ||
Total Revenue | ||||
Annualized Net Charge-Off Rate | 12.0% | 12.1% +/- 15 bps | 12.1% | |
30+ Day Delinquency Rate | 5.2% | 5.1% - 5.3% 2 | 5.5% | |
Net Income (Loss) | N/A | |||
Adjusted EBITDA 1 | ||||
Adjusted Net Income (Loss) 1 | N/A | |||
1 Our calculations of Adjusted EBITDA and Adjusted Net Income were updated in Q1 2024 to more closely align with management’s internal view of the performance of the business. The Q1 2023 values for Adjusted EBITDA and Adjusted Net Income shown in the table above have been revised and presented on a comparable basis. Prior to these revisions the Q1 2023 values would have been | ||||
2 As indicated on page 11 of the Company's 4Q 2023 Earnings Presentation. | ||||
“We are pleased to report preliminary indications of a strong first quarter,” said
Improving Credit Trends
In addition, following the Company's
Post-
Note: 3Q22 vintage only includes August and
Earnings Release and Conference Call
Preliminary Information
Numbers are as of
About
Forward-Looking Statements
This press release contains forward-looking statements. These forward-looking statements are subject to the safe harbor provisions under the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact contained in this press release, including statements as to future performance, results of operations and financial position; the Company's preliminary financial results for the first quarter of 2024; the Company's expectations related to sustainable and profitable earnings growth and the creation of shareholder value are forward-looking statements. These statements can be generally identified by terms such as “expect,” “plan,” “goal,” “target,” “anticipate,” “assume,” “predict,” “project,” “outlook,” “continue,” “due,” “may,” “believe,” “seek,” or “estimate” and similar expressions or the negative versions of these words or comparable words, as well as future or conditional verbs such as “will,” “should,” “would,” “likely” and “could.” These statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause Oportun’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
About Non-GAAP Financial Measures
This press release presents information about the Company’s Adjusted EBITDA and Adjusted Net Income, which are non-GAAP financial measures provided as a supplement to the results provided in accordance with accounting principles generally accepted in
As previously announced on
Adjusted EBITDA
The Company defines Adjusted EBITDA as net income, adjusted to eliminate the effect of certain items as described below. The Company believes that Adjusted EBITDA is an important measure because it allows management, investors and its board of directors to evaluate and compare operating results, including return on capital and operating efficiencies, from period to period by making the adjustments described below. In addition, it provides a useful measure for period-to-period comparisons of
- The Company believes it is useful to exclude the impact of income tax expense, as reported, because historically it has included irregular income tax items that do not reflect ongoing business operations.
- The Company believes it is useful to exclude depreciation and amortization and stock-based compensation expense because they are non-cash charges.
- The Company believes it is useful to exclude the impact of interest expense associated with the Company's corporate financing facilities, including the senior secured term loan and the residual financing facility, as it views this expense as related to its capital structure rather than its funding.
- The Company excludes the impact of certain non-recurring charges, such as expenses associated with our workforce optimization, and other non-recurring charges because it does not believe that these items reflect ongoing business operations. Other non-recurring charges include litigation reserve, impairment charges, debt amendment and warrant amortization costs related to our corporate financing facilities.
- The Company also excludes fair value mark-to-market adjustments on its loans receivable portfolio and asset-backed notes carried at fair value because these adjustments do not impact cash.
Adjusted Net Income
The Company defines Adjusted Net Income as net income adjusted to eliminate the effect of certain items as described below. The Company believes that Adjusted Net Income is an important measure of operating performance because it allows management, investors, and the Company's board of directors to evaluate and compare its operating results, including return on capital and operating efficiencies, from period to period, excluding the after-tax impact of non-cash, stock-based compensation expense and certain non-recurring charges.
- The Company believes it is useful to exclude the impact of income tax expense (benefit), as reported, because historically it has included irregular income tax items that do not reflect ongoing business operations. The Company also includes the impact of normalized income tax expense by applying a normalized statutory tax rate.
- The Company believes it is useful to exclude the impact of certain non-recurring charges, such as expenses associated with our workforce optimization, and other non-recurring charges because it does not believe that these items reflect its ongoing business operations. Other non-recurring charges include litigation reserve, impairment charges, debt amendment and warrant amortization costs related to our corporate financing facilities.
- The Company believes it is useful to exclude stock-based compensation expense because it is a non-cash charge.
- The Company also excludes the fair value mark-to-market adjustment on its asset-backed notes carried at fair value to align with the 2023 accounting policy decision to account for new debt financings at amortized cost.
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA
Three Months Ended | ||||
(dollars in millions) | 2024 | 2023* | ||
Net income (loss) | $ (102.1) | |||
Adjustments: | ||||
Income tax expense (benefit) | (5.1) - (4.0) | (39.4) | ||
Interest on corporate financing (1) | 13.9 | 9.8 | ||
Depreciation and amortization | 13.2 | 13.4 | ||
Stock-based compensation expense | 4.0 | 4.5 | ||
Workforce optimization expenses | 0.8 | 6.8 | ||
Other non-recurring charges (1) | 3.5 | 2.3 | ||
Fair value mark-to-market adjustment | (0.3) - (1.4) | 84.5 | ||
Adjusted EBITDA | $ | (20.2) | ||
(1) Certain prior-period financial information has been reclassified to conform to current period presentation. | ||||
* Our calculation of Adjusted EBITDA was updated in Q1 2024 to more closely align with management’s internal view of the performance of the business. The Q1 2023 value for Adjusted EBITDA shown in the table above has been revised and presented on a comparable basis. Prior to these revisions the Q1 2023 value would have been | ||||
Adjusted Net Income (Loss)
Three Months Ended | ||||
(dollars in millions) | 2024 | 2023* | ||
Net income (loss) | $ (102.1) | |||
Adjustments: | ||||
Income tax expense (benefit) | (5.1) - (4.0) | (39.4) | ||
Stock-based compensation expense | 4.0 | 4.5 | ||
Workforce optimization expenses | 0.8 | 6.8 | ||
Other non-recurring charges (1) | 3.5 | 2.3 | ||
Mark-to-market adjustment on ABS notes | 26.8 - 27.2 | 48.9 | ||
Adjusted income before taxes | (79.0) | |||
Normalized income tax expense | 0.0 - 1.5 | (21.3) | ||
Adjusted Net Income (Loss) | $ | (57.7) | ||
(1) Certain prior-period financial information has been reclassified to conform to current period presentation. | ||||
* Our calculation of Adjusted Net Income (Loss) was updated in Q1 2024 to more closely align with management’s internal view of the performance of the business. The Q1 2023 value for Adjusted Net Income (Loss) shown in the table above has been revised and presented on a comparable basis. Prior to these revisions the Q1 2023 value would have been | ||||
Note: Numbers may not foot or cross-foot due to rounding.
A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/8d6d544f-423e-48a1-9824-96954d850d4b
Investor ContactDorian Hare (650) 590-4323 ir@oportun.com Media Contact Usher Lieberman (720) 987-9538 usher.lieberman@oportun.com
Post-July 2022 credit tightening quarterly vintages are outperforming prior vintages in net lifetime loss rate by month on book
Note: 3Q22 vintage only includes August and September 2022 .
2024 GlobeNewswire, Inc., source