GoEasy grows sales, earnings
MISSISSAUGA, Ontario – Its small consumer loans segment continues to bolster both top line revenue and earnings per share for GoEasy as the contribution made by its traditional furniture and appliance leasing operations gets relatively smaller.
For the three months ending 30 September 2018, total revenues were $129.9 million, up 26.5% from $102.7 million garnered during the same period of 2017. Overall same store sales grew 26.2%, building on 21.3% for the prior period.
Revenue from EasyFinancial – its consumer loans segment – was $129.9 million, up 26.5% from last year’s $102.2 million and accounted for 73.6% of GoEasy’s top line for the third quarter, up from a 66.9% share for the comparable period.
The company also said the value of its consumer loan portfolio gained 58.5% and stood at $749.6 million on 30 September.
Revenue for EasyHome – its big ticket leasing segment – was $34.3 million, up a modest 0.8% from $34.0 million. However, same store sales gained 6.2%, double that of the comparable period while operating margin grew to 17.2%, a gain of 4.9% year-over-year. Offsetting these improvements was a 3.5% decline in potential monthly lease revenue.
Net income was $14.3 million or 97 cents per share, compared to $11.6 million or 81 cents per share – an uptick of 19.8% on a per share basis.
“It was a solid quarter for the company, highlighted by record financial results,” GoEasy chief executive officer David Ingram said in a statement. “The strong revenue growth, combined with stable credit performance, led to improved margins, record earnings per share and a record return on equity of nearly 24%.”
For the nine months also ending 30 September 2018, GoEasy revenue was $368.0 million, up 25% from the prior year’s $294.5 million. Same store sales growth was pegged at 25%.
Revenue from EasyFinancial was up 38.6% to $265.0 million, from $191.2 million.
Meanwhile, EasyHome revenue slipped 0.2% to $103 million from $103.2 million although this segment’s same store sales were up 6.1% for the year-to-date.
Net income was $37.2 million or $2.53 per share, compared to $30.8 million or $2.17 per share – an increase of 16.7% on a per share basis.
Ingram also confirmed the company is holding true to the revised performance targets announced at the end of the first half for the years 2018 through 2020. These include growing the loan portfolio to $1.3 billion by 2020 and adding as many as 20 new EasyFinancial locations in each of 2019 and 2020. Total revenue is targeted to grow as much as 26% year-over-year in 2018 and then by 22% next year and 16% in 2020.
“We are still at the early stages of a significant period for growth that will continue to build our leadership position in the non-prime lending space,” Ingram said. “To this end, I am extremely proud to have guided the company for the last 18 years and have always been inspired by the meaningful relationships that our front-line staff have worked tirelessly to build with the customers in their communities.
“In January when I take on the role of executive chairman,” he continued, “I will pass the reigns over to Jason Mullins to assume the role of CEO, who has demonstrated during his eight years with our Company the qualities and commitment to be an outstanding leader for the future of our organisation.”
At the end of September, GoEasy operated 165 EasyHome stores across the country – including 31 franchise stores – down from 171 a year ago. Its EasyFinancial network contained 238 in-store kiosks and stand-along locations, a gain of 10 locations from the same time last year.