Atlanticus Holdings Corp Q1 2024 10-Q Filing

TL;DR

<b>Atlanticus Holdings Corp reported Q1 2024 results with a revenue decrease but a slight net income increase, alongside changes in asset and debt levels.</b>

AI Summary

Atlanticus Holdings Corp (ATLCZ) filed a Quarterly Report (10-Q) with the SEC on May 10, 2024. Total revenue for Q1 2024 was $177.2 million, a decrease from $158.0 million in Q1 2023. Net income for Q1 2024 was $19.7 million, an increase from $20.5 million in Q1 2023. Total assets were $2,107.0 million as of March 31, 2024, compared to $2,128.6 million as of December 31, 2023. Total debt was $1,795.4 million as of March 31, 2024, compared to $1,795.9 million as of December 31, 2023. Shares related to unvested share-based payment awards were 293,578 for Q1 2024, up from 188,384 for Q1 2023.

Why It Matters

For investors and stakeholders tracking Atlanticus Holdings Corp, this filing contains several important signals. The decrease in revenue may indicate slowing business activity or increased competition in the personal credit sector. The increase in shares related to unvested awards suggests potential future dilution or increased employee compensation.

Risk Assessment

Risk Level: medium — Atlanticus Holdings Corp shows moderate risk based on this filing. The company's financial performance is subject to covenants tied to default rates and collateral performance, which could trigger early repayment of debt if not met.

Analyst Insight

Monitor the company's ability to meet debt covenants and its revenue trends in the upcoming quarters.

Financial Highlights

revenue

177.2

total Assets

2,107.0

total Debt

1,795.4

net Income

19.7

revenue Growth

-12.15

Key Numbers

• 177.2 — Q1 2024 Revenue (in millions)
• 158.0 — Q1 2023 Revenue (in millions)
• 19.7 — Q1 2024 Net Income (in millions)
• 20.5 — Q1 2023 Net Income (in millions)
• 2,107.0 — Total Assets (as of March 31, 2024, in millions)
• 1,795.4 — Total Debt (as of March 31, 2024, in millions)
• 293,578 — Unvested Share-Based Awards (Q1 2024)
• 188,384 — Unvested Share-Based Awards (Q1 2023)

Key Players & Entities

• Atlanticus Holdings Corp (company) — Filer
• CompuCredit Holdings Corp (company) — Former company name
• Prime Rate (dollar_amount) — 8.50%
• SOFR (dollar_amount) — 5.34%

FAQ

Risk Factors

• Loan Covenants [medium — financial]: Loans are subject to affirmative covenants tied to default rates and performance metrics, failure of which could result in required early repayment.
• Variable Interest Entities (VIEs) [medium — financial]: Loans are associated with VIEs, and creditors only have recourse to the collateral within these VIEs, not the general assets of the Company.

Glossary

VIEs

Variable Interest Entities (Creditors of VIEs only have recourse to the collateral within the VIEs, not the Company's general assets.)

Prime Rate

A benchmark interest rate published by The Wall Street Journal. (Used as a reference for setting interest rates on various loans.)

Key Financial Figures

• $39 billion — nfrastructure built from servicing over $39 billion in consumer loans over more than 25 yea

Filing Documents

• atlc20240331_10q.htm (10-Q) — 1981KB
• ex_615103.htm (EX-31.1) — 11KB
• ex_615104.htm (EX-31.2) — 11KB
• ex_615105.htm (EX-32.1) — 6KB
• atlanticus.jpg (GRAPHIC) — 12KB
• 0001437749-24-016032.txt (&nbsp;) — 8414KB
• atlc-20240331.xsd (EX-101.SCH) — 67KB
• atlc-20240331_cal.xml (EX-101.CAL) — 50KB
• atlc-20240331_def.xml (EX-101.DEF) — 437KB
• atlc-20240331_lab.xml (EX-101.LAB) — 413KB
• atlc-20240331_pre.xml (EX-101.PRE) — 476KB
• atlc20240331_10q_htm.xml (XML) — 1325KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements (Unaudited)

Financial Statements (Unaudited) 1 Consolidated Balance Sheets 1 Consolidated Statements of Income 2 Consolidated Statement of Shareholders' Equity and Temporary Equity 3 Consolidated Statements of Cash Flows 4

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 5 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 20 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 38 Item 4.

Controls and Procedures

Controls and Procedures 38

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 39 Item 1A.

Risk Factors

Risk Factors 39 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 54 Item 3. Defaults Upon Senior Securities 54 Item 4. Mine Safety Disclosures 54 Item 5. Other Information 55 Item 6. Exhibits 55

Signatures

Signatures 56 i Table of Contents

--FINANCIAL INFORMATION

PART I--FINANCIAL INFORMATION ITEM 1.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS Atlanticus Holdings Corporation and Subsidiaries Consolidated Balance Sheets (Unaudited) (Dollars in thousands) March 31, December 31, 2024 2023 Assets Unrestricted cash and cash equivalents (including $ 177.2 million and $ 158.0 million associated with variable interest entities at March 31, 2024 and December 31, 2023, respectively) $ 444,809 $ 339,338 Restricted cash and cash equivalents (including $ 19.7 million and $ 20.5 million associated with variable interest entities at March 31, 2024 and December 31, 2023, respectively) 37,494 44,315 Loans at fair value (including $ 2,107.0 million and $ 2,128.6 million associated with variable interest entities at March 31, 2024 and December 31, 2023, respectively) 2,150,636 2,173,759 Loans at amortized cost 100,144 98,425 Property at cost, net of depreciation 10,855 11,445 Operating lease right-of-use assets 11,313 11,310 Prepaid expenses and other assets 31,964 27,853 Total assets $ 2,787,215 $ 2,706,445 Liabilities Accounts payable and accrued expenses $ 59,173 $ 61,634 Operating lease liabilities 20,034 20,180 Notes payable, net (including $ 1,795.4 million and $ 1,795.9 million associated with variable interest entities at March 31, 2024 and December 31, 2023, respectively) 1,862,518 1,861,685 Senior notes, net 199,028 144,453 Income tax liability 92,870 85,826 Total liabilities 2,233,623 2,173,778 Commitments and contingencies (Note 10) Preferred stock, no par value, 10,000,000 shares authorized: Series A preferred stock, 400,000 shares issued and outstanding (liquidation preference - $ 40.0 million) at March 31, 2024 and December 31, 2023 (Note 5) (1) 40,000 40,000 Class B preferred units issued to noncontrolling interests (Note 5) 100,325 100,250 Shareholders' Equity Series B preferred stock, no par value, 3,300,704 shares issued and outstanding at March 31, 2024 (liquidation preference - $ 82.5 million); 3,256,561 shares

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements March 31, 2024 and 2023 1. Description of Our Business Our accompanying consolidated financial statements include the accounts of Atlanticus Holdings Corporation (the "Company") and those entities we control. We are a purpose driven financial technology company. We are primarily focused on facilitating consumer credit through the use of our financial technology and related services. Through our subsidiaries, we provide technology and other support services to lenders who offer an array of financial products and services to consumers who may have been declined by other providers of credit. We are principally engaged in providing products and services to lenders in the U.S. and, in most cases, we invest in the receivables originated by lenders who utilize our technology platform and other related services. From time to time, we also purchase receivables portfolios from third parties. In these Notes to Consolidated Financial Statements, "receivables" or "loans" typically refer to receivables we have purchased from our bank partners or from third parties. Within our Credit as a Service ("CaaS") segment, we apply our technology solutions, in combination with the experiences gained, and infrastructure built from servicing over $39 billion in consumer loans over more than 25 years of operating history, to support lenders in offering more inclusive financial services. These products include private label credit and general purpose credit cards originated by lenders through multiple channels, including retailers and healthcare providers, direct mail solicitation, digital marketing and partnerships with third parties. The services of our bank partners are often extended to consumers who may not have access to financing options with larger financial institutions. Our flexible technology solutions allow our bank partners to integrate our paperless process and instant decisioning platform with the existing infrastructure of pa

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View this 10-Q filing on SEC EDGAR