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Oct 31, 2022
Car-Mart Q2 2023 Earnings Report
America's Car-Mart reported diluted earnings per share of $0.48 on revenues of $352 million.
Key Takeaways
America's Car-Mart reported a 24% increase in revenues to $352 million, driven by a 30% increase in interest income. Diluted earnings per share were reported at $0.48. The company faced challenges including wholesale losses and higher costs, but remains optimistic about long-term growth.
Revenues increased by 24% to $352 million, with interest income up 30%.
Unit sales volume increased by 7%, and the average sales price increased by 13%.
Sales volume productivity reached 34.4 units sold per dealership per month, a 5% increase year-over-year.
Net charge-offs as a percentage of average receivables were 5.8%.
Forward Guidance
The company anticipates wholesale losses to continue into the next quarter but views them as temporary. They are adjusting retail prices and believe that as vehicle prices moderate, they can gain market share. The company expects to increase consumer interest rates to 18% in most states.
Positive Outlook
- The company believes the current environment will drive more higher credit quality customers to the Car-Mart family in the future.
- The company sees opportunities to strengthen deal structures without significantly affecting volumes.
- The company remains confident in both its long-term growth prospects and its ability to earn ROEs in line with its historical averages.
- The company is focused on its long-term goals of serving more customers and improving productivity at its dealerships.
- The company believes that customers rely on the services they provide, and they have a large opportunity to help them in times such as these.
Challenges Ahead
- The company anticipates wholesale losses to continue into the next quarter.
- The company's customer is stressed by high prices for necessities like gas, food, and rent, while the price of their vehicle remains relatively high.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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