The following is a summary of the Consumer Portfolio Services, Inc (CPSS) Q2 2024 Earnings Call Transcript:

Financial Performance:

• For Q2 2024, Consumer Portfolio Services reported a revenue of $95.9 million, marking a 5% increase from the previous quarter and a 13% increase year-over-year.

• The company experienced a pretax income of $6.7 million and net income of $4.7 million for the quarter.

• Earnings per share were $0.19, reflecting a significant decrease from the previous year's $0.55.

• Total debt grew to $2.9 billion, up 16% from the previous year, while shareholder's equity reached a record high of $280.3 million.

Business Progress:

• The company increased its loan origination to $431.9 million in Q2 2024, representing a 25% increase from the previous quarter and 36% year-over-year.

• Significant expansion in sales force and dealer networks, growing to 86 reps and reaching 99 large dealer groups.

• Launched second phase of document processing AI bot in originations to increase efficiency and reduce fraud.

Opportunities:

• Positive movements in the portfolio and growth strategies indicate readiness to capitalize on potential future drops in interest rates.

• Expanding large dealer group base and efficient operational modifications point to readiness for scaled growth and market capture.

Risks:

• The increase in interest expenses driven by higher interest rates and portfolio growth poses a risk to profitability if not managed alongside rate adjustments.

• Modest credit and charge-off improvements need continued monitoring and adjustment to maintain portfolio health.

More details: Consumer Portfolio Services IR

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