The following is a summary of the Regional Management Corp. (RM) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Regional Management Corp reported a net income of $7.7 million for Q3 2024, with diluted EPS of $0.76.

• Net income and EPS were affected by $4.3 million of post-tax costs due to hurricane impacts, reducing EPS by $0.42.

• The company achieved a quarterly revenue record of $146 million, despite charges for hurricane-related insurance claims.

• The provision for credit losses was $4.6 million, reflecting the requirement to reserve for estimated lifetime credit losses due to portfolio growth.

Business Progress:

• Regional Management Corp grew its portfolio by $46 million sequentially, reaching a record $1.82 billion, reflecting an annualized growth rate of over 10%.

• They are on track to open 7 new branches by the end of the year, mainly in newly operational states, boosting future volumes and revenues.

• The company expanded into 8 new states since 2020, enhancing its geographical footprint and customer base.

Opportunities:

• The focus on high-margin small loans and portfolios with APRs greater than 36% led to portfolio growth and is slated to drive future revenues.

• Expansion into new states with new branch openings is expected to enhance market capture and customer reach.

Risks:

• The company noted that hurricane activity had a significant negative impact, particularly Hurricane Helene, requiring substantial financial reserves and affecting overall profitability in Q3.

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