• Open Lending Reports Third Quarter 2024 Financial Results

    المصدر: Nasdaq GlobeNewswire / 07 نوفمبر 2024 15:05:02   America/Chicago

    AUSTIN, Texas, Nov. 07, 2024 (GLOBE NEWSWIRE) -- Open Lending Corporation (Nasdaq: LPRO) (the “Company” or “Open Lending”), an industry trailblazer in lending enablement and risk analytics solutions for financial institutions, today reported financial results for its third quarter of 2024.

    “I am pleased to report that in the third quarter of 2024, we were near or above the high end of our guidance for certified loans, revenue, and adjusted EBITDA, excluding the negative change in estimate associated with our profit share,” said Chuck Jehl, Chief Executive Officer and interim Chief Financial Officer of Open Lending. "We continue to be encouraged that market conditions are trending positive in the automotive industry, specifically improvement in inventory levels, retail sales volumes and ultimately affordability. Our team remains focused on taking prudent steps to maximize the opportunity ahead to ensure we are well positioned for when the market inevitably recovers."

    Three Months Ended September 30, 2024 Highlights

    • The Company facilitated 27,435 certified loans during the third quarter of 2024, compared to 29,959 certified loans in the third quarter of 2023.
    • Total revenue was $23.5 million during the third quarter of 2024, compared to $26.0 million in the third quarter of 2023. The third quarter of 2024 was negatively impacted by a $7.0 million reduction in estimated future profit share revenues related to business in historic vintages as compared to a $8.1 million reduction in the third quarter of 2023.
    • Gross profit was $17.3 million during the third quarter of 2024, compared to $20.6 million in the third quarter of 2023.
    • Net income was $1.4 million during the third quarter of 2024, compared to $3.0 million in the third quarter of 2023.
    • Adjusted EBITDA was $7.8 million during the third quarter of 2024, compared to $10.3 million in the third quarter of 2023.

    Adjusted EBITDA is a non-GAAP financial measure. A reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure is provided in the financial table included at the end of this press release. An explanation of this measure and how it is calculated is also included under the heading “Non-GAAP Financial Measures.”

    Fourth Quarter 2024 Outlook

    Based on trends into the fourth quarter of 2024, the Company is issuing its fourth quarter 2024 guidance ranges as follows:

    Total Certified Loans20,000 - 24,000
    Total Revenue$22 - $26 million
    Adjusted EBITDA$7 - $10 million


    The guidance provided above includes forward-looking statements within the meaning of U.S. securities laws. See “Forward-Looking Statements” below.

    Conference Call
    Open Lending will host a conference call to discuss the third quarter 2024 financial results today at 5:00 pm ET. The conference call will be webcast live from the Company's investor relations website at https://investors.openlending.com/ under the “Events” section. The conference call can also be accessed live over the phone by dialing (800) 343-5172, or for international callers (785) 424-1699; the conference ID is LENDING. An archive of the webcast will be available at the same location on the website shortly after the call has concluded.

    About Open Lending
    Open Lending (Nasdaq: LPRO) provides loan analytics, risk-based pricing, risk modeling and default insurance to auto lenders throughout the United States. For over 20 years, we have been empowering financial institutions to create profitable auto loan portfolios with less risk and more reward. For more information, please visit www.openlending.com.

    Forward-Looking Statements
    This press release includes certain statements that are not historical facts but are forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995, including statements related to market trends, consumer behavior and demand for automotive loans, as well as future financial performance under the heading “Fourth Quarter 2024 Outlook” above. Forward-looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “plan,” “predict,” “potential,” “seem,” “seek,” “future,” “outlook,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements are based on various assumptions and on the current expectations of the Company’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the Company’s control. These forward-looking statements are subject to a number of risks and uncertainties, including general economic, market, political and business conditions; applicable taxes, inflation, supply chain disruptions including global hostilities and responses thereto, interest rates and the regulatory environment; the outcome of judicial proceedings to which Open Lending may become a party; and other risks discussed in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2023. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that the Company presently does not know or that it currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect the Company’s expectations, plans or forecasts of future events and views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its assessments to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.

    Non-GAAP Financial Measures
    The non-GAAP financial measures included in this press release are financial information that has not been prepared in accordance with GAAP. The Company uses Adjusted EBITDA and Adjusted EBITDA margin internally in analyzing our financial results and believes these measures are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. The Company believes that the use of non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial results with other companies in our industry, many of which present similar non-GAAP financial measures to investors.

    The Company believes these measures provide useful information to investors and others in understanding and evaluating its operating results in the same manner as its management and board of directors. In addition, these measures provide useful measures for period-to-period comparisons of our business, as they remove the effect of certain non-cash items and certain non-recurring variable charges. Adjusted EBITDA is defined as GAAP net income excluding interest expense, income taxes, depreciation and amortization expense of property and equipment, and share-based compensation expense. Adjusted EBITDA margin is defined as Adjusted EBITDA expressed as a percentage of total revenue.

    Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measure provided in the financial statement tables included below in this press release.

    Investor Relations Contact:
    InvestorRelations@openlending.com


    OPEN LENDING CORPORATION
    Condensed Consolidated Balance Sheets
    (Unaudited, in thousands, except share data)

      September 30, 2024 December 31, 2023
    Assets    
    Current assets    
    Cash and cash equivalents $250,233  $240,206 
    Restricted cash  10,714   6,463 
    Accounts receivable, net  4,566   4,616 
    Current contract assets, net  17,810   28,704 
    Income tax receivable  8,041   7,035 
    Other current assets  3,364   2,852 
    Total current assets  294,728   289,876 
    Fixed assets, net  5,534   3,913 
    Operating lease right-of-use asset, net  4,071   3,990 
    Contract assets  22,098   610 
    Deferred tax asset, net  65,614   70,113 
    Other assets  3,662   5,535 
    Total assets $395,707  $374,037 
    Liabilities and stockholders’ equity    
    Current liabilities    
    Accounts payable $282  $375 
    Accrued expenses  10,303   8,131 
    Current portion of debt  7,500   4,688 
    Third-party claims administration liability  10,750   6,464 
    Other current liabilities  2,445   932 
    Total current liabilities  31,280   20,590 
    Long-term debt, net of deferred financing costs  134,002   139,357 
    Operating lease liabilities  3,463   3,450 
    Other liabilities  6,499   5,060 
    Total liabilities $175,244  $168,457 
    Commitments and contingencies    
    Stockholders’ equity    
    Preferred stock, $0.01 par value; 10,000,000 shares authorized and none issued and outstanding $  $ 
    Common stock, $0.01 par value; 550,000,000 shares authorized, 128,198,185 shares issued and 119,255,709 shares outstanding as of September 30, 2024 and 128,198,185 shares issued and 118,819,795 shares outstanding as of December 31, 2023  1,282   1,282 
    Additional paid-in capital  501,918   502,032 
    Accumulated deficit  (184,323)  (193,749)
    Treasury stock at cost, 8,942,476 shares at September 30, 2024 and 9,378,390 at December 31, 2023  (98,414)  (103,985)
    Total stockholders’ equity $220,463  $205,580 
    Total liabilities and stockholders’ equity $395,707  $374,037 


    OPEN LENDING CORPORATION
    Condensed Consolidated Statements of Operations
    (Unaudited, in thousands, except share data)

     Three Months Ended
    September 30,
     Nine Months Ended
    September 30,
      2024   2023   2024   2023 
    Revenue       
    Program fees$14,161  $15,416  $43,306  $50,610 
    Profit share 6,822   8,022   30,037   44,433 
    Claims administration and other service fees 2,493   2,568   7,605   7,478 
    Total revenue 23,476   26,006   80,948   102,521 
    Cost of services 6,127   5,369   17,590   16,917 
    Gross profit 17,349   20,637   63,358   85,604 
    Operating expenses       
    General and administrative 9,594   9,875   33,318   31,041 
    Selling and marketing 4,897   4,509   13,260   13,136 
    Research and development 992   1,717   3,601   4,075 
    Total operating expenses 15,483   16,101   50,179   48,252 
    Operating income 1,866   4,536   13,179   37,352 
    Interest expense (2,962)  (2,799)  (8,468)  (7,841)
    Interest income 3,221   2,801   9,278   7,317 
    Other expense, net    (3)     (9)
    Income before income taxes 2,125   4,535   13,989   36,819 
    Income tax expense 688   1,532   4,563   9,907 
    Net income$1,437  $3,003  $9,426  $26,912 
    Net income per common share       
    Basic$0.01  $0.02  $0.08  $0.22 
    Diluted$0.01  $0.02  $0.08  $0.22 
    Weighted average common shares outstanding       
    Basic 119,252,503   120,217,857   119,128,801   121,318,872 
    Diluted 119,480,577   121,298,880   119,427,952   122,065,718 


    OPEN LENDING CORPORATION
    Condensed Consolidated Statements of Cash Flows
    (Unaudited, in thousands)

     Nine Months Ended September 30,
      2024   2023 
    Cash flows from operating activities   
    Net income$9,426  $26,912 
    Adjustments to reconcile net income to net cash provided by operating activities:   
    Share-based compensation 6,408   6,826 
    Depreciation and amortization of fixed assets 1,281   824 
    Amortization of debt issuance costs 321   319 
    Non-cash operating lease cost 511   461 
    Deferred income taxes 4,499   386 
    Other 37   10 
    Changes in assets & liabilities:   
    Accounts receivable, net 50   455 
    Contract assets, net (10,594)  26,199 
    Other current and non-current assets (576)  (789)
    Accounts payable (92)  (67)
    Accrued expenses 2,164   2,299 
    Income tax receivable, net 881   513 
    Operating lease liabilities (464)  (412)
    Third-party claims administration liability 4,286   1,749 
    Other current and non-current liabilities 2,838   218 
    Net cash provided by operating activities 20,976   65,903 
    Cash flows from investing activities   
    Purchase of property and equipment (161)  (103)
    Capitalized software development costs (2,577)  (1,485)
    Net cash used in investing activities (2,738)  (1,588)
    Cash flows from financing activities   
    Payments on term loans (2,813)  (2,813)
    Shares repurchased    (31,322)
    Shares withheld for taxes related to restricted stock units (1,147)  (288)
    Net cash used in financing activities (3,960)  (34,423)
    Net change in cash and cash equivalents and restricted cash 14,278   29,892 
    Cash and cash equivalents and restricted cash at the beginning of the period 246,669   208,519 
    Cash and cash equivalents and restricted cash at the end of the period$260,947  $238,411 
    Supplemental disclosure of cash flow information:   
    Interest paid$7,981  $7,593 
    Income tax paid (refunded), net$(817) $9,008 
    Right-of-use assets obtained in exchange for lease obligations$592  $ 
    Non-cash investing and financing:   
    Fixed assets accrued but not paid$  $2 
    Share-based compensation for capitalized software development$196  $63 
    Capitalized software development costs accrued but not paid$244  $230 
    Accrued excise tax associated with share repurchases$  $290 


    OPEN LENDING CORPORATION
    Reconciliation of GAAP to Non-GAAP Financial Measures
    (Unaudited, in thousands)

     Three Months Ended
    September 30,
     Nine Months Ended
    September 30,
      2024   2023   2024   2023 
    Net income$1,437  $3,003  $9,426  $26,912 
    Non-GAAP adjustments:       
    Interest expense 2,962   2,799   8,468   7,841 
    Income tax expense 688   1,532   4,563   9,907 
    Depreciation and amortization of fixed assets 494   328   1,281   824 
    Share-based compensation 2,186   2,663   6,408   6,826 
    Total adjustments 6,330   7,322   20,720   25,398 
    Adjusted EBITDA$7,767  $10,325  $30,146  $52,310 
    Total revenue$23,476  $26,006  $80,948  $102,521 
    Adjusted EBITDA margin 33%  40%  37%  51%

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