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Jan 31, 2021
Car-Mart Q3 2021 Earnings Report
America's Car-Mart reported diluted earnings per share of $2.85 on record revenues of $228 million.
Key Takeaways
America's Car-Mart reported a strong increase in top-line revenue driven by a 16.5% increase in the average retail sales price and a 5.6% increase in units sold. The company saw improvements in cost structure and credit results, with net charge-offs decreasing. The company continues to invest in infrastructure and technology to support a larger customer base and improve the customer experience.
Revenue increased due to a 16.5% rise in average retail sales price and a 5.6% increase in units sold.
Productivity improved by 2.0% for the quarter, despite a tight supply of vehicles at lower price points.
Net charge-offs decreased to 4.9% of average finance receivables, compared to 5.9% in the prior year quarter.
Selling, general, and administrative expenses decreased to 16.7% of sales compared to 18.6% in the prior year quarter.
Forward Guidance
America's Car-Mart is focused on its transformation from a collections company to a sales company with strong collections capabilities, and believes more consumers will see the benefits of being part of the Car-Mart Family.
Positive Outlook
- The company is optimistic about the combination of its community-based structure and growing digital presence.
- Investments in infrastructure are expected to support a larger customer base and improve cost structure.
- The company is focused on recruiting, training, and retaining great associates.
- The company is investing in inventory procurement and delivering great customer experience.
- The company's strong balance sheet provides a competitive advantage for market share expansion and acquisitions.
Challenges Ahead
- There is still much uncertainty related to credit results since the pandemic began.
- The company continues to see a tight supply of vehicles at lower price points.
- Significant investments are required for key areas to fulfill the company's vision.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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