Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2018shares | |
Document and Entity Information | |
Entity Registrant Name | Community Choice Financial Inc. |
Entity Central Index Key | 1,528,061 |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2018 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Common Stock, Shares Outstanding | 7,990,020 |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q2 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 60,166 | $ 66,627 |
Restricted cash | 4,370 | 4,585 |
Finance receivables, net of allowance for loan losses of $12,563 and $13,517 | 74,056 | 89,707 |
Card related pre-funding and receivables | 906 | 1,062 |
Other current assets | 17,534 | 15,271 |
Total current assets | 157,032 | 177,252 |
Noncurrent Assets | ||
Finance receivables, net of allowance for loan losses of $1,994 and $2,810 | 3,471 | 4,632 |
Property, leasehold improvements and equipment, net | 23,339 | 26,848 |
Other intangible assets | 485 | 924 |
Security deposits | 2,153 | 2,750 |
Total assets | 186,480 | 212,406 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 33,197 | 39,566 |
Money orders payable | 8,114 | 7,169 |
Accrued interest | 5,160 | 5,145 |
Current portion of capital lease obligation | 49 | 371 |
Current portion of line of credit, net of deferred issuance costs of $4,360 and $-0- | 42,640 | |
Current portion of subsidiary notes payable, net of deferred issuance costs of $1,635 and $1 | 58,487 | 118 |
Current portion of senior secured notes, net of deferred issuance cost of $940 and $-0- | 236,350 | |
Deferred revenue | 2,535 | 2,535 |
Total current liabilities | 386,532 | 54,904 |
Noncurrent Liabilities | ||
Lease termination payable | 645 | 818 |
Line of credit, net of deferred issuance costs of $-0- and $1,871 | 45,129 | |
Subsidiary notes payable, net of deferred issuance costs of $14 and $762 | 1,763 | 61,077 |
Senior secured notes, net of deferred issuance costs of $126 and $1,664 | 12,374 | 248,126 |
Deferred revenue | 6,253 | 7,520 |
Total liabilities | 407,567 | 417,574 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Preferred stock, par value $.01 per share, 3,000 shares authorized, no shares issued and outstanding | ||
Common stock, par value $.01 per share, 300,000 authorized shares and 7,990 outstanding shares at June 30, 2018 and December 31, 2017 | 90 | 90 |
Additional paid-in capital | 129,692 | 129,675 |
Retained deficit | (350,819) | (334,883) |
Treasury stock | (50) | (50) |
Total stockholders' deficit | (221,087) | (205,168) |
Total liabilities and stockholders' equity | $ 186,480 | $ 212,406 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Finance receivables, net | ||
Finance receivables current, allowance for loan losses (in dollars) | $ 12,563 | $ 13,517 |
Finance receivables noncurrent, allowance for loan losses (in dollars) | $ 1,994 | $ 2,810 |
Stockholders' equity | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 3,000 | 3,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 300,000 | 300,000 |
Common stock, shares outstanding | 7,990 | 7,990 |
Revolving credit facility | ||
Finance receivables, net | ||
Net of deferred issuance costs, current liabilities (in dollars) | $ 4,360 | $ 0 |
Net of deferred issuance costs, noncurrent liabilities (in dollars) | 0 | 1,871 |
Subsidiary notes payable | ||
Finance receivables, net | ||
Net of deferred issuance costs, current liabilities (in dollars) | 1,635 | 1 |
Net of deferred issuance costs, noncurrent liabilities (in dollars) | 14 | 762 |
Senior secured notes payable | ||
Finance receivables, net | ||
Net of deferred issuance costs, current liabilities (in dollars) | 940 | 0 |
Net of deferred issuance costs, noncurrent liabilities (in dollars) | $ 126 | $ 1,664 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues: | ||||
Total Revenues | $ 81,325 | $ 81,168 | $ 168,976 | $ 166,520 |
Operating expenses: | ||||
Salaries | 17,361 | 17,516 | 34,493 | 34,789 |
Provision for loan losses | 22,823 | 23,859 | 45,458 | 43,399 |
Occupancy | 6,229 | 6,602 | 12,572 | 13,231 |
Advertising and marketing | 1,496 | 1,544 | 2,507 | 2,358 |
Lease termination | 469 | 944 | 566 | 991 |
Depreciation and amortization | 2,104 | 2,327 | 4,327 | 4,865 |
Other | 10,984 | 12,351 | 22,009 | 24,266 |
Total operating expenses | 61,466 | 65,143 | 121,932 | 123,899 |
Operating gross profit | 19,859 | 16,025 | 47,044 | 42,621 |
Corporate and other expenses: | ||||
Corporate expenses | 17,159 | 20,290 | 34,761 | 40,476 |
Lease termination | 1,762 | |||
Depreciation and amortization | 1,329 | 1,181 | 2,422 | 2,490 |
Interest expense, net | 13,619 | 12,431 | 25,797 | 23,802 |
Total corporate and other expenses | 32,107 | 33,902 | 62,980 | 68,530 |
Loss from continuing operations, before tax | (12,248) | (17,877) | (15,936) | (25,909) |
Provision for income taxes | 333 | 666 | ||
Net loss | (12,248) | (18,210) | (15,936) | (26,575) |
Finance receivable fees | ||||
Revenues: | ||||
Total Revenues | 46,310 | 47,930 | 97,242 | 96,981 |
Credit service fees | ||||
Revenues: | ||||
Total Revenues | 17,491 | 15,146 | 36,687 | 33,285 |
Check cashing fees | ||||
Revenues: | ||||
Total Revenues | 11,562 | 11,779 | 23,254 | 23,905 |
Card fees | ||||
Revenues: | ||||
Total Revenues | 2,511 | 2,113 | 4,459 | 4,120 |
Other | ||||
Revenues: | ||||
Total Revenues | $ 3,451 | $ 4,200 | $ 7,334 | $ 8,229 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - 6 months ended Jun. 30, 2018 - USD ($) $ in Thousands | Common Stock | Treasury Stock | Additional Paid-In Capital | Retained Deficit | Total |
Balance at Dec. 31, 2017 | $ 90 | $ (50) | $ 129,675 | $ (334,883) | $ (205,168) |
Balance (in shares) at Dec. 31, 2017 | 7,990,020 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Stock-based compensation expense | 17 | 17 | |||
Net loss | (15,936) | (15,936) | |||
Balance at Jun. 30, 2018 | $ 90 | $ (50) | $ 129,692 | $ (350,819) | $ (221,087) |
Balance (in shares) at Jun. 30, 2018 | 7,990,020 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities | ||
Net loss | $ (15,936) | $ (26,575) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Provision for loan losses | 45,458 | 43,399 |
Loss on disposal of assets | 271 | 1,829 |
Depreciation | 6,310 | 7,105 |
Amortization of note discount and deferred debt issuance costs | 3,167 | 2,099 |
Amortization of intangibles | 439 | 250 |
Deferred income taxes | 423 | |
Stock-based compensation | 17 | 32 |
Changes in assets and liabilities: | ||
Short-term investments | 500 | |
Card related pre-funding and receivables | 156 | (277) |
Other assets | (1,666) | 4,572 |
Deferred revenue | (1,267) | (1,138) |
Accrued interest | 15 | (189) |
Money orders payable | 945 | (283) |
Lease termination payable | (173) | 1,112 |
Accounts payable and accrued expenses | (6,369) | (2,952) |
Net cash provided by operating activities | 31,367 | 29,907 |
Cash flows from investing activities | ||
Net receivables originated | (28,646) | (39,370) |
Net acquired assets, net of cash | (117) | |
Purchase of leasehold improvements and equipment | (3,072) | (3,501) |
Net cash used in investing activities | (31,718) | (42,988) |
Cash flows from financing activities | ||
Proceeds from subsidiary note | 15,000 | |
Payments on subsidiary note | (59) | (7,356) |
Payments on capital lease obligations | (322) | (540) |
Net proceeds on lines of credit | 14,150 | |
Debt issuance costs | (5,944) | (3,718) |
Net cash provided by (used in) financing activities | (6,325) | 17,536 |
Net increase (decrease) in cash and cash equivalents and restricted cash | (6,676) | 4,455 |
Cash and cash equivalents and restricted cash: | ||
Beginning | 71,212 | 109,348 |
Ending | $ 64,536 | $ 113,803 |
Consolidated Statements of Cas7
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Consolidated Statements of Cash Flows | ||||
Cash and cash equivalents | $ 60,166 | $ 66,627 | $ 110,573 | $ 106,333 |
Restricted Cash | 4,370 | 4,585 | 3,230 | 3,015 |
Total cash and cash equivalents and restricted cash | $ 64,536 | $ 71,212 | $ 113,803 | $ 109,348 |
Ownership, Nature of Business,
Ownership, Nature of Business, and Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Ownership, Nature of Business, and Significant Accounting Policies | |
Ownership, Nature of Business, and Significant Accounting Policies | Note 1. Ownership, Nature of Business, and Significant Accounting Policies Nature of business: Community Choice Financial Inc. (together with its consolidated subsidiaries, “CCFI” or “the Company”) owned and operated 478 retail locations in 12 states and was licensed to deliver similar financial services over the internet in 30 states as of June 30, 2018. Through its network of retail locations and over the internet, the Company provides customers a variety of financial products and services, including secured and unsecured, short and medium‑term consumer loans, check cashing, prepaid debit cards, and other services that address the specific needs of its individual customers. A summary of the Company’s significant accounting policies follows: Basis of presentation: The accompanying interim unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10‑Q and accounting principles generally accepted in the United States (“GAAP”) for interim financial information. They do not include all information and footnotes required by GAAP for complete financial statements. Although management believes that the disclosures are adequate to prevent the information from being misleading, the interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2017, included in the Company’s Annual Report on Form 10‑K filed with the Securities & Exchange Commission on April 2, 2018. All adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial condition, have been included. The results for any interim period are not necessarily indicative of results to be expected for the year ending December 31, 2018. Basis of consolidation: The accompanying consolidated financial statements include the accounts of CCFI. All significant intercompany accounts and transactions have been eliminated in consolidation. Business segments: FASB Accounting Standards Codification (“ASC”) Topic 280 Segment Reporting requires that a public enterprise report a measure of segment profit or loss, certain specific revenue and expense items, segment assets, information about the way operating segments were determined and other items. The Company reports operating segments in accordance with FASB ASC Topic 280. Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in determining how to allocate resources and assess performance. The Company operates in two segments: Retail financial services and Internet financial services. Equity method investments: Entities and investments over which the Company exercises significant influence over the activities of the entity but which do not meet the requirements for consolidation are accounted for using the equity method of accounting pursuant to ASC 323, whereby the Company records its share of the underlying income or loss of these entities. Intercompany profit arising from transactions with affiliates is eliminated to the extent of its beneficial interest. Under the equity method of accounting for these investments, there is no recognition of losses once the carrying value of the investment, inclusive of advanced and loans, has been reduced to zero and there are no guarantee or funding obligations associated therewith. On September 30, 2017, the Company entered into a joint venture with a third party to offer insurance products through select retail locations in a certain market. The joint venture is managed by the third party. Revenue recognition: Transactions include loans, credit service fees, check cashing, bill payment, money transfer, money order sales, and other miscellaneous products and services. The full amount of the check cashing fee is recognized as revenue at the time of the transaction. Fees and direct costs incurred for the origination of loans are deferred and amortized over the loan period using the interest method. The Company acts in an agency capacity regarding bill payment services, money transfers, card products, and money orders offered and sold at its retail locations. The Company records the net amount retained as revenue because the supplier is the primary obligor in the arrangement, the amount earned by the Company is fixed, and the supplier is determined to have the ultimate credit risk. Revenue on loans determined to be troubled debt restructurings are recognized at the impaired loans’ original interest rates until the impaired loans are charged off or paid by the customer. Credit service organization (“CSO”) fees are recognized over the arranged credit service period. Finance receivables: Finance receivables consist of short term and medium‑term consumer loans. Short-term consumer loans can be unsecured or secured with a maturity up to ninety days. Unsecured short-term loan products typically range in principal from $100 to $1,000, with a maturity between fourteen and thirty days, and include a written agreement to defer the presentment of the customer’s personal check or preauthorized debit for the aggregate amount of the advance plus fees. This form of lending is based on applicable laws and regulations, which vary by state. State statutes vary from charging fees of 15% to 20%, to charging interest at 25% per annum plus origination fees. The customers repay the cash advance by making cash payments or allowing a check or preauthorized debit to be presented. Secured consumer loans with a maturity of ninety days or less are included in this category and represented 12.8% and 14.5% of short-term consumer loans at June 30, 2018 and December 31, 2017, respectively. Medium-term consumer loans can be unsecured or secured with a maturity greater than ninety days and up to thirty-six months. Unsecured medium-term products typically range from $100 to $5,000, and are evidenced by a promissory note with a maturity between three and thirty-six months. These consumer loans vary in structure depending upon the applicable laws and regulations where they are offered. The medium-term consumer loans are payable in installments or provide for a line of credit with periodic payments. Secured consumer loans with a maturity greater than ninety days are included in this category and represented 14.5% and 12.6% of medium-term consumer loans at June 30, 2018, and December 31, 2017, respectively. Allowance for loan losses: Provisions for loan losses are charged to income in amounts sufficient to maintain an adequate allowance for loan losses and an adequate accrual for losses related to guaranteed loans processed for third-party lenders under the CSO programs. The factors used in assessing the overall adequacy of the allowance for loan losses, the accrual for losses related to guaranteed loans made by third-party lenders and the resulting provision for loan losses include an evaluation by product, by market based on historical loan loss experience, and delinquency of certain medium-term consumer loans. The Company evaluates various qualitative factors that may or may not affect the computed initial estimate of the allowance for loan losses, by using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. For short term unsecured consumer loans, the Company’s policy is to charge off loans when they become past due. The Company’s policy dictates that, where a customer has provided a check or ACH authorization for presentment upon the maturity of a loan, if the customer has not paid off the loan by the due date, the Company will deposit the customer’s check or draft the customer’s bank account for the amount due. If the check or draft is returned as unpaid, all accrued fees and outstanding principal are charged-off as uncollectible. For short term secured loans, the Company’s policy requires that balances be charged off when accounts are either thirty or sixty days past due depending on the product. For medium term secured and unsecured consumer loans that have a term of one year or less, the Company’s policy requires that balances be charged off when accounts are sixty days past due. For medium term secured and unsecured consumer loans that have an initial maturity of greater than one year, the Company’s policy requires that balances be charged off when accounts are ninety-one days past due. In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. These reduced interest rates and changed payment terms were limited to loans that the Company believed the customer had the ability to pay in the foreseeable future. These loans were accounted for as troubled debt restructurings and represent the only loans considered impaired due to the nature of the Company’s charge-off policy. Recoveries of amounts previously charged off are recorded to the allowance for loan losses or the accrual for third‑party losses in the period in which they are received. Lease termination payable: The Company records a liability in the consolidated balance sheets for the remaining lease obligations with the corresponding lease termination expense for closed retail locations disclosed in the operating expenses section, and closed corporate locations disclosed in the corporate and other expenses section, of the consolidated statements of operations, respectively. Fair value of financial instruments: Financial assets and liabilities measured at fair value are grouped in three levels. The levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are: · Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities. · Level 2—Inputs other than quoted prices that are observable for assets and liabilities, either directly or indirectly. These inputs include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are less attractive. · Level 3—Unobservable inputs for assets and liabilities reflecting the reporting entity’s own assumptions. The Company follows the provisions of ASC 820‑10, Fair Value Measurements and Disclosures, which applies to all assets and liabilities that are being measured and reported on a fair value basis. ASC 820‑10 requires a disclosure that establishes a framework for measuring fair value within GAAP and expands the disclosure about fair value measurements. This standard enables a reader of consolidated financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The standard requires that assets and liabilities carried at fair value be classified and disclosed in one of the three categories. In determining the appropriate levels, the Company performed a detailed analysis of the assets and liabilities that are subject to ASC 820-10. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The Company’s financial instruments consist primarily of cash and cash equivalents, finance receivables, restricted cash, and lines of credit. For all such instruments, other than senior secured notes and notes payable at June 30, 2018, and December 31, 2017, the carrying amounts in the consolidated financial statements approximate their fair values. Finance receivables are short term in nature and are originated at prevailing market rates and lines of credit bear interest at current market rates. The fair value of finance receivables at June 30, 2018 and December 31, 2017 approximates carrying value and is measured using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. The fair value of the Company’s 10.75% senior secured notes due 2019 (the “2019 notes”) and the 12.75% senior secured notes due 2020 (the “2020 notes”) were determined based on market yield on trades of the 2019 notes at the end of the recent reporting period. June 30, 2018 Carrying Amount Fair Value Level Financial assets: Cash and cash equivalents $ 60,166 $ 60,166 1 Restricted cash 4,370 4,370 1 Finance receivables 77,527 77,527 3 Financial liabilities: 10.75% Senior secured notes 237,290 175,595 1 12.75% Senior secured notes 12,500 6,777 2 Subsidiary Note payable 61,899 61,899 2 Line of Credit 47,000 47,000 2 December 31, 2017 Carrying Amount Fair Value Level Financial assets: Cash and cash equivalents $ 66,627 $ 66,627 1 Restricted cash 4,585 4,585 1 Finance receivables 94,339 94,339 3 Financial liabilities: 10.75% Senior secured notes 237,290 212,636 1 12.75% Senior secured notes 12,500 10,841 2 Subsidiary Note payable 61,958 61,958 2 Line of Credit 47,000 47,000 2 Treasury Stock: Treasury stock is reported at cost and consists of one million common shares at June 30, 2018 and December 31, 2017. Subsequent events: The Company has evaluated its subsequent events (events occurring after June 30, 2018) through the issuance date of August 14, 2018. |
Finance Receivables, Credit Qua
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | 6 Months Ended |
Jun. 30, 2018 | |
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | |
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | Note 2. Finance Receivables, Credit Quality Information and Allowance for Loan Losses Finance receivables representing amounts due from customers for advances at June 30, 2018, and December 31, 2017, consisted of the following: June 30, December 31, 2018 2017 Short-term consumer loans $ 57,530 $ 66,465 Medium-term consumer loans 37,187 46,903 Gross receivables $ 94,717 $ 113,368 Unearned advance fees, net of deferred loan origination costs (2,633) (2,702) Finance receivables before allowance for loan losses 92,084 110,666 Allowance for loan losses (14,557) (16,327) Finance receivables, net $ 77,527 $ 94,339 Finance receivables, net Current portion $ 74,056 $ 89,707 Non-current portion 3,471 4,632 Total finance receivables, net $ 77,527 $ 94,339 Changes in the allowance for loan losses by product type for the three months ended June 30, 2018, are as follows: Allowance as Balance Balance Receivables a percentage 4/1/2018 Provision Charge-Offs Recoveries 6/30/2018 6/30/2018 of receivables Short-term consumer loans $ 2,318 $ 8,699 $ (15,617) $ 7,231 $ 2,631 $ 57,530 4.57 % Medium-term consumer loans 12,485 6,084 (7,677) 1,034 11,926 37,187 32.07 % $ 14,803 $ 14,783 $ (23,294) $ 8,265 $ 14,557 $ 94,717 15.37 % The provision for loan losses for the three months ended June 30, 2018, also includes losses from returned items from check cashing of $1,329. The provision for short-term consumer loans of $8,699 is net of debt sales of $412 for the three months ended June 30, 2018. The provision for medium-term consumer loans of $6,084 is net of debt sales of $216 for the three months ended June 30, 2018. The Company evaluates all short-term and medium-term consumer loans collectively for impairment, except for individually evaluating medium-term loans that have been modified and classified as troubled debt restructurings. In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. The provision and subsequent charge off related to these loans totaled $21 and is included in the provision for medium-term consumer loans for the three months ended June 30, 2018. For these loans evaluated for impairment, there were $67 of payment defaults during the three months ended June 30, 2018. The troubled debt restructurings during the three months ended June 30, 2018 are subject to an allowance of $10 with a net carrying value of $13 at June 30, 2018. Changes in the allowance for loan losses by product type for the six months ended June 30, 2018, are as follows: Allowance as Balance Balance Receivables a percentage 1/1/2018 Provision Charge-Offs Recoveries 6/30/2018 6/30/2018 of receivables Short-term consumer loans $ 2,697 $ 16,858 $ (34,041) $ 17,117 $ 2,631 $ 57,530 4.57 % Medium-term consumer loans 13,630 14,481 (18,744) 2,559 11,926 37,187 32.07 % $ 16,327 $ 31,339 $ (52,785) $ 19,676 $ 14,557 $ 94,717 15.37 % The provision for loan losses for the six months ended June 30, 2018, also includes losses from returned items from check cashing of $2,391. The provision for short-term consumer loans of $16,858 is net of debt sales of $823 for the six months ended June 30, 2018. The provision for medium-term consumer loans of $14,481 is net of debt sales of $778 for the six months ended June 30, 2018. The provision and subsequent charge off related to troubled debt restructurings totaled $41 and is included in the provision for medium-term consumer loans for the six months ended June 30, 2018. For these loans evaluated for impairment, there were $121 of payment defaults during the six months ended June 30, 2018. The troubled debt restructurings during the six months ended June 30, 2018 are subject to an allowance of $16 with a net carrying value of $26 at June 30, 2018. Changes in the allowance for loan losses by product type for the three months ended June 30, 2017, are as follows: Allowance as Balance Balance Receivables a percentage 4/1/2017 Provision Charge-Offs Recoveries 6/30/2017 6/30/2017 of receivable Short-term consumer loans $ 1,846 $ 9,393 $ (19,902) $ 11,219 $ 2,556 $ 63,638 4.02 % Medium-term consumer loans 11,163 8,007 (9,854) 1,080 10,396 42,119 24.68 % $ 13,009 $ 17,400 $ (29,756) $ 12,299 $ 12,952 $ 105,757 12.25 % The provision for loan losses for the three months ended June 30, 2017, also includes losses from returned items from check cashing of $1,695. The provision for short-term consumer loans of $9,393 is net of debt sales of $347 for the three months ended June 30, 2017. The provision for medium-term consumer loans of $8,007 is net of debt sales of $224 for the three months ended June 30, 2017. The provision and subsequent charge off related to troubled debt restructurings totaled $21 and is included in the provision for medium-term consumer loans for the three months ended June 30, 2017. For these loans evaluated for impairment, there were $29 of payment defaults during the three months ended June 30, 2017. The troubled debt restructurings during the three months ended June 30, 2017 are subject to an allowance of $7 with a net carrying value of $22 at June 30, 2017. Changes in the allowance for loan losses by product type for the six months ended June 30, 2017, are as follows: Allowance as Balance Balance Receivables a percentage 1/1/2017 Provision Charge-Offs Recoveries 6/30/2017 6/30/2017 of receivable Short-term consumer loans $ 2,223 $ 15,826 $ (39,036) $ 23,543 $ 2,556 $ 63,638 4.02 % Medium-term consumer loans 13,996 15,228 (21,833) 3,005 10,396 42,119 24.68 % $ 16,219 $ 31,054 $ (60,869) $ 26,548 $ 12,952 $ 105,757 12.25 % The provision for loan losses for the six months ended June 30, 2017, also includes losses from returned items from check cashing of $3,094. The provision for short-term consumer loans of $15,826 is net of debt sales of $437 for the six months ended June 30, 2017. The provision for medium-term consumer loans of $15,228 is net of debt sales of $599 for the six months ended June 30, 2017. The provision and subsequent charge off related to troubled debt restructurings totaled $34 and is included in the provision for medium-term consumer loans for the six months ended June 30, 2017. For these loans evaluated for impairment, there were $319 of payment defaults during the six months ended June 30, 2017. The troubled debt restructurings during the six months ended June 30, 2017 are subject to an allowance of $11 with a net carrying value of $37 at June 30, 2017. The Company has subsidiaries that facilitate third-party lender loans. Changes in the accrual for third-party lender losses for the three months and six months ended June 30, 2018, and 2017 were as follows: Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Short-term balance, beginning of period $ $ $ $ Provision for loan losses Charge-offs, net Short-term balance, end of period $ $ $ $ Medium-term balance, beginning of period $ $ $ $ Provision for loan losses Charge-offs, net Medium-term balance, end of period $ $ $ $ Total balance, beginning of period $ $ $ $ Provision for loan losses Charge-offs, net Total balance, end of period $ $ $ $ The Company offers a CSO product in Ohio and Texas to assist consumers in obtaining credit with unaffiliated third-party lenders. Total gross finance receivables for which the Company has recorded an accrual for third‑party lender losses totaled $33,585 and $36,967 at June 30, 2018, and December 31, 2017, respectively, and the corresponding guaranteed consumer loans are disclosed as an off‑balance sheet arrangement. The total gross finance receivables for the Ohio CSO product consist of $29,284 and $31,341 in short-term and $1,057 and $1,166 in medium-term loans at June 30, 2018 and December 31,2017, respectively. The total gross finance receivables for the Texas CSO product consist of $3,244 and $4,460 in short-term loans at June 30, 2018 and December 31,2017, respectively. The provision for third party lender losses of $6,711 and $11,728 for the three months and six months ending June 30, 2018 is net of debt sales of $375 and $585, respectively. The provision for third party lender losses of $4,764 and $9,251 for the three months and six months ending June 30, 2017 is net of debt sales of $62 and $243, respectively. For the Ohio CSO Program, the Company was required to purchase $11,237 and $5,280 of short-term loans and $139 and $159 of medium-term loans during the three months, and $24,421 and $13,393 of short-term loans and $336 and $363 of medium-term during the six months ended June 30, 2018 and 2017, respectively. As these loans were in default when purchased, they met the Company’s policy and were fully charged-off at acquisition. The Company recognized recoveries of $6,836 and $2,868 of short-term and $87 and $72 of medium-term collections on these loans during the three months, and $16,677 and $8,282 of short-term and $147 and $145 of medium-term collections on these loans during the six months ended June 30, 2018 and 2017, respectively. For the Texas CSO Program, the Company was required to purchase $2,450 and $3,565 of short-term loans during the three months, and $6,104 and $7,020 of short-term loans during the six months ended June 30, 2018 and 2017, respectively. As these loans were in default when purchased, they met the Company’s policy and were fully charged-off at acquisition. The Company recognized recoveries of $837 and $1,442 of short-term collections on these loans during the three months, and $2,274 and $3,174 of short-term collections on these loans during the six months ended June 30, 2018 and 2017, respectively. The Company considers the near term repayment performance of finance receivables as its primary credit quality indicator. The Company performs credit checks through consumer reporting agencies on certain borrowers. If a third-party lender provides the advance, the applicable third‑party lender decides whether to approve the loan and establishes all of the underwriting criteria and terms, conditions, and features of the customer’s loan agreement. The aging of receivables at June 30, 2018, and December 31, 2017, were as follows: June 30, 2018 December 31, 2017 Current finance receivables $ 85,733 90.5 % $ 101,102 89.2 % Past due finance receivables (1 - 30 days) Short-term consumer loans 1,325 1.4 % 2,046 1.8 % Medium-term consumer loans 4,709 5.0 % 6,502 5.7 % Total past due finance receivables (1 - 30 days) 6,034 6.4 % 8,548 7.5 % Past due finance receivables (31 - 60 days) Medium-term consumer loans 2,208 2.3 % 3,130 2.8 % Total past due finance receivables (31 - 60 days) 2,208 2.3 % 3,130 2.8 % Past due finance receivables (61 - 90 days) Medium-term consumer loans 742 0.8 % 588 0.5 % Total past due finance receivables (61 - 90 days) 742 0.8 % 588 0.5 % Total delinquent 8,984 9.5 % 12,266 10.8 % $ 94,717 % $ 113,368 % |
Related Party Transactions and
Related Party Transactions and Balances | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions and Balances | |
Related Party Transactions and Balances | Note 3. Related Party Transactions and Balances There were no new significant related party transactions, or material changes to existing related party transactions, during the six months ended June 30, 2018. |
Other Intangible Assets
Other Intangible Assets | 6 Months Ended |
Jun. 30, 2018 | |
Other Intangible Assets | |
Other Intangible Assets | Note 4. Other Intangible Assets Intangible amortization expense for the three months ended June 30, 2018, and 2017 was $316 and $126, respectively, and for the six months ended June 30, 2018, and 2017 was $439 and $250, respectively. There were no additional significant changes to other intangible assets during the six months ended June 30, 2018. |
Pledged Assets and Debt
Pledged Assets and Debt | 6 Months Ended |
Jun. 30, 2018 | |
Pledged Assets and Debt | |
Pledged Assets and Debt | Note 5. Pledged Assets and Debt Lines of credit at June 30, 2018 and December 31, 2017, consisted of the following: June 30, 2018 December 31, 2017 Deferred Deferred Issuance Net Issuance Net Principal Costs Principal Principal Costs Principal $47,000 Revolving credit, secured, interest rate as defined below, due April 2019, collateralized by all Guarantor Company assets $ 47,000 $ 4,360 $ 42,640 $ 47,000 $ 1,871 $ 45,129 47,000 4,360 42,640 47,000 1,871 45,129 Less current maturities 47,000 4,360 42,640 — — — Long-term portion $ — $ — $ — $ 47,000 $ 1,871 $ 45,129 The interest rate is set at three-month LIBOR plus 11%, and there is an exit fee for early termination of the facility. The 3-month LIBOR was 2.34% and 1.69% at June 30, 2018 and December 31, 2017, respectively, and the prime rate was 5.00% and 4.50% at June 30, 2018 and December 31, 2017, respectively. On March 30, 2018, the Company amended its revolving credit facility with Victory Park Management, LLC, as administrative agent, and certain of its affiliates as lenders, which we refer to collectively as VPC, to extend the maturity date to April 4, 2019. The amendment also waived certain events of default, eliminated the obligation to satisfy a quarterly fixed charge coverage test and added covenants addressing daily minimum liquidity and asset coverage tests, weekly operational reporting requirements and monthly EBITDA and borrowing base coverage tests. Senior secured notes payable at June 30, 2018, and December 31, 2017, consisted of the following: June 30, 2018 December 31, 2017 Deferred Deferred Issuance Net Issuance Net Principal Costs Principal Principal Costs Principal $395,000 Senior Note payable, 10.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2019 $ 237,290 $ 940 $ 236,350 $ 237,290 $ 1,504 $ 235,786 $25,000 Senior Note payable, 12.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2020 12,500 126 12,374 12,500 160 12,340 249,790 1,066 248,724 249,790 1,664 248,126 Less current maturities 237,290 940 236,350 — — — Long-term portion $ 12,500 $ 126 $ 12,374 $ 249,790 $ 1,664 $ 248,126 Subsidiary notes payable at June 30, 2018, and December 31, 2017, consisted of the following: June 30, 2018 December 31, 2017 Deferred Deferred Issuance Net Issuance Net Principal Costs Principal Principal Costs Principal $60,000 Note, secured, 16.75%, collateralized by acquired loans, due April 2019 $ 60,000 $ 1,634 $ 58,366 $ 60,000 $ 744 $ 59,256 $1,425 Term note, secured, 4.25%, collateralized by financed asset, due July 2019 852 3 849 882 5 877 $1,165 Term note, secured, 4.50%, collateralized by financed asset, due May 2021 1,047 12 1,035 1,076 14 1,062 61,899 1,649 60,250 61,958 763 61,195 Less current maturities 60,122 1,635 58,487 119 1 118 Long-term portion $ 1,777 $ 14 $ 1,763 $ 61,839 $ 762 $ 61,077 On March 30, 2018, the $60,000 Note was further amended to extend the maturity date to April 4, 2019. The amendment increases the administrative fee to 0.95% and permits an additional extension of the facility maturity date to April 2021 if certain conditions are met. The amendment allows for additional short term loans within the borrowing base and includes additional covenants addressing daily minimum cash and asset coverage tests, dividend limits, weekly operational reporting requirements, borrowing base reporting and a monthly consolidated EBITDA test. Liquidity and Need for Additional Capital The Company’s indebtedness includes $237,290 of senior notes, $47,000 of revolving credit facility debt, and $60,000 in subsidiary notes that are due in the second quarter of 2019. The Company’s expected cash position will not be sufficient to repay this indebtedness as it becomes due and the Company will need to restructure or refinance this indebtedness and there can be no assurances as to the ability of the Company to conclude such a restructuring or refinancing. These factors raise substantial doubt regarding the Company’s ability to meet its obligations and continue as a going concern for the period which extends one-year from the issuance of these financial statements. While the Company is currently engaged in negotiations with its largest bondholders, the success of such negotiations cannot be assured. Any inability to reach an agreement with existing debt holders, secure sufficient refinancing sources for our pending debt maturities and/or our inability to continue as a going concern could have a significant and material adverse effect on the Company, its operations and its investors and, in particular, could significantly impair recoveries by our current bondholders. It is unlikely that the Company’s assets, in any event, would be sufficient to satisfy its current debt obligations. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Accounts Payable and Accrued Liabilities | |
Accounts Payable and Accrued Liabilities | Note 6. Accounts Payable and Accrued Liabilities Accounts payable and accrued liabilities at June 30, 2018, and December 31, 2017, consisted of the following: June 30, December 31, 2018 2017 Accounts payable $ 4,330 $ 5,465 Accrued payroll and compensated absences 5,266 7,718 Wire transfers payable 1,738 2,238 Accrual for third-party losses 4,484 4,818 Unearned CSO Fees 7,730 8,029 Deferred rent 716 867 Bill payment service liability 2,260 2,604 Lease termination 1,602 1,978 Other 5,071 5,849 $ 33,197 $ 39,566 |
Operating and Capital Lease Com
Operating and Capital Lease Commitments and Total Rental Expense | 6 Months Ended |
Jun. 30, 2018 | |
Operating and Capital Lease Commitments and Total Rental Expense | |
Operating and Capital Lease Commitments and Total Rental Expense | Note 7. Operating and Capital Lease Commitments and Total Rental Expense Rental expense, including common area maintenance and real estate tax expense, totaled $6,535 and $6,908 for the three months ended June 30, 2018, and 2017, and $13,195 and $13,942 for the six months ended June 30, 2018 and 2017, respectively. The Company closed its Utah facility during the three months ended March 31, 2017, resulting in lease termination expense of $1,762 which is disclosed on the consolidated statement of operations There were no additional significant changes to operating and capital lease commitments during the six months ended June 30, 2018. |
Concentrations of Credit Risks
Concentrations of Credit Risks | 6 Months Ended |
Jun. 30, 2018 | |
Concentrations of Credit Risks | |
Concentrations of Credit Risks | Note 8. Concentrations of Credit Risks The Company’s portfolio of finance receivables is comprised of loan agreements with customers living in thirty-three states and consequently such customers’ ability to honor their contracts may be affected by economic conditions in those states. Additionally, the Company is subject to regulation by federal and state governments that affect the products and services provided by the Company. To the extent that laws and regulations are passed that affect the Company’s ability to offer loans or similar products in any of the states in which it operates, the Company’s financial position could be adversely affected. The following table summarizes the allocation of the portfolio balance by state at June 30, 2018, and December 31, 2017: June 30, 2018 December 31, 2017 Balance Percentage of Balance Percentage of State Outstanding Total Outstanding Outstanding Total Outstanding Alabama $ 11,025 % $ 12,808 % Arizona 10,511 11,994 California 32,753 39,835 Mississippi 6,782 7,409 Virginia 10,309 12,018 Other retail segment states 16,974 19,696 Other internet segment states 6,363 9,608 Total $ 94,717 100.0 % $ 113,368 100.0 % The other retail segment states are: Florida, Indiana, Kentucky, Michigan, Oregon, and Tennessee. The Retail financial services segment includes Ohio, however, for the concentration of credit risk table, other retail segment states excludes Ohio as it offers a CSO product through a third-party lender. The other internet segment states are: Alabama, Alaska, California, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Kansas, Louisiana, Maine, Minnesota, Mississippi, Missouri, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming. The Company offers a CSO product in Ohio and Texas to assist consumers in obtaining credit with unaffiliated third-party lenders. Total gross finance receivables for which the Company has recorded an accrual for third-party lender losses totaled $33,585 and $36,967 at June 30, 2018, and December 31, 2017, respectively, and the corresponding guaranteed consumer loans are disclosed as an off-balance sheet arrangement. The total gross finance receivables for the Ohio CSO product consist of $29,284 and $31,341 in short-term and $1,057 and $1,166 in medium-term loans at June 30, 2018 and December 31,2017, respectively. The total gross finance receivables for the Texas CSO product consist of $3,244 and $4,460 in short-term loans at June 30, 2018 and December 31,2017, respectively. |
Contingencies
Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Contingencies | |
Contingencies | Note 9. Contingencies From time‑to‑time the Company is a defendant in various lawsuits and administrative proceedings wherein certain amounts are claimed or violations of law or regulations are asserted. In the opinion of the Company’s management, these claims are without substantial merit and should not result in judgments which in the aggregate would have a material adverse effect on the Company’s financial statements. |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Stock Based Compensation | |
Stock Based Compensation | Note 10. Stock Based Compensation During the three months ended March 31, 2018, the Company issued 76,559 options with a per share exercise price of $1.00 with the options vesting on specific dates defined in the award agreements. Stock option activity for the six months ended June 30, 2018, is as follows (these amounts have not been rounded in thousands): Weighted-Average Aggregate Exercise Price Weighted-Average Intrinsic (actual per Remaining Value Shares share price) Contractual Term (thousands) Outstanding at December 31, 2017 1,332,632 $ 2.25 8.5 N/A Granted 76,559 1.00 8.3 N/A Exercised — — — N/A Forfeited or expired — — — N/A Outstanding at June 30, 2018 1,409,191 $ 2.18 8.3 N/A Exercisable at June 30, 2018 1,277,737 $ 2.25 8.2 $ — Vested or expected to vest at June 30, 2018 1,409,191 $ 2.18 8.3 $ — Stock-based compensation costs for the six months ended June 30, 2018, and 2017 were $17 and $32, respectively. As of June 30, 2018, and December 31, 2017, unrecognized stock-based compensation costs to be recognized over future periods approximated $49 and $66, respectively. At June 30, 2018, the remaining unrecognized compensation expense was $49 for certain awards that vest over the requisite service period. The remaining compensation expense of $49 is expected to be recognized over a weighted-average period of 1.6 years. The total income tax benefit recognized in the income statement for the stock-based compensation arrangements was $5 and $9 for the six months ended June 30, 2018, and 2017, respectively. |
Business Segments
Business Segments | 6 Months Ended |
Jun. 30, 2018 | |
Business Segments | |
Business Segments | Note 11. Business Segments The Company has elected to organize and report on its operations as two operating segments: Retail financial services and Internet financial services. The following tables present summarized financial information for the Company’s segments: As of and for the three months ended June 30, 2018 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 160,566 $ 25,914 $ 186,480 Other Intangible Assets 103 382 485 Total Revenues $ 68,920 100.0 % $ 12,405 100.0 % $ 81,325 100.0 % Provision for Loan Losses 17,162 24.9 % 5,661 45.6 % 22,823 28.0 % Other Operating Expenses 36,570 53.1 % 2,073 16.7 % 38,643 47.5 % Operating Gross Profit 15,188 22.0 % 4,671 37.7 % 19,859 24.5 % Interest Expense, net 10,514 15.3 % 3,105 25.0 % 13,619 16.7 % Depreciation and Amortization 1,236 1.8 % 93 0.7 % 1,329 1.6 % Other Corporate Expenses (a) — — 17,159 17,159 21.1 % Income (loss) from Continuing Operations, before tax 3,438 5.0 % 1,473 11.9 % (17,159) (12,248) (15.1) % (a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated. As of and for the six months ended June 30, 2018 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 160,566 $ 25,914 $ 186,480 Other Intangible Assets 103 382 485 Total Revenues $ 141,717 100.0 % $ 27,259 100.0 % $ 168,976 100.0 % Provision for Loan Losses 32,782 23.1 % 12,676 46.5 % 45,458 26.9 % Other Operating Expenses 72,861 51.4 % 3,613 13.3 % 76,474 45.3 % Operating Gross Profit 36,074 25.5 % 10,970 40.2 % 47,044 27.8 % Interest Expense, net 19,993 14.1 % 5,804 21.3 % 25,797 15.3 % Depreciation and Amortization 2,236 1.6 % 186 0.7 % 2,422 1.5 % Other Corporate Expenses (a) — — — — 34,761 34,761 20.6 % Income (Loss) from Continuing Operations, before tax 13,845 9.8 % 4,980 18.3 % (34,761) (15,936) (9.4) % (a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated. As of and for the three months ended June 30, 2017 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 333,345 $ 35,802 $ 369,147 Goodwill 113,499 — 113,499 Other Intangible Assets 449 716 1,165 Total Revenues $ 65,726 100.0 % $ 15,442 100.0 % $ 81,168 100.0 % Provision for Loan Losses 15,402 23.4 % 8,457 54.8 % 23,859 29.4 % Other Operating Expenses 39,358 59.9 % 1,926 12.4 % 41,284 50.9 % Operating Gross Profit 10,966 16.7 % 5,059 32.8 % 16,025 19.7 % Interest Expense, net 8,687 13.2 % 3,744 24.2 % 12,431 15.3 % Depreciation and Amortization 1,093 1.7 % 88 0.6 % 1,181 1.5 % Other Corporate Expenses (a) — — — 20,290 20,290 25.0 % Income (loss) from Continuing Operations, before tax 1,186 1.8 % 1,227 7.9 % (20,290) (17,877) (22.0) % (a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated. As of and for the six months ended June 30, 2017 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 333,345 $ 35,802 $ 369,147 Goodwill 113,499 — 113,499 Other Intangible Assets 449 716 1,165 Total Revenues $ 134,417 100.0 % $ 32,103 100.0 % $ 166,520 100.0 % Provision for Loan Losses 27,460 20.4 % 15,939 49.6 % 43,399 26.1 % Other Operating Expenses 77,564 57.7 % 2,936 9.2 % 80,500 48.3 % Operating Gross Profit 29,393 21.9 % 13,228 41.2 % 42,621 25.6 % Interest Expense, net 16,053 11.9 % 7,749 24.1 % 23,802 14.3 % Depreciation and Amortization 2,222 1.7 % 268 0.8 % 2,490 1.5 % Lease termination Expenses — — 1,762 5.5 % 1,762 1.1 % Other Corporate Expenses (a) — — — — 40,476 40,476 24.3 % Income (loss) from Continuing Operations, before tax 11,118 8.3 % 3,449 10.7 % (40,476) (25,909) (15.6) % (a) |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Taxes | |
Income Taxes | Note 12. Income Taxes The Company files a consolidated federal income tax return. The Company files consolidated or separate state income tax returns as permitted by the individual states in which it operates. The differences between our effective rate and the U.S. statutory rate is primarily due to non-deductible expenses, state taxes, and changes in valuation allowance. The Company had no liability recorded for unrecognized tax benefits at June 30, 2018, and December 31, 2017. At June 30, 2018, the Company had gross deferred tax assets of $76,464 and a valuation allowance of $76,464. At December 31, 2017, the Company had gross deferred tax assets of $71,896 and a valuation allowance of $71,896. The Company maintains a full valuation allowance against its deferred tax assets as it is more likely than not that the deferred tax assets will not be realized. In evaluating whether a valuation allowance is needed for the deferred tax assets, the Company considered the ability to carry net operating losses back to prior periods, reversing taxable temporary differences, and estimates of future taxable income. There have been no credits or net operating losses that have expired. The projections were evaluated in light of past operating results and considered the risks associated with generating future taxable income due to macroeconomic conditions in the markets in which the Company operates, regulatory developments and cost containment. The Company will continue to evaluate the need for a valuation allowance against deferred tax assets in future periods and will adjust the allowance as necessary if it determines that it is more likely than not that some or all of the deferred tax assets will be realized. |
Transactions with Variable Inte
Transactions with Variable Interest Entities | 6 Months Ended |
Jun. 30, 2018 | |
Transactions with Variable Interest Entities | |
Transactions with Variable Interest Entities | Note 13. Transactions with Variable Interest Entities The Company has limited agency agreements with unaffiliated third-party lenders. The agreements govern the terms by which the Company refers customers to that lender, on a non-exclusive basis, for a possible extension of credit, processes loan applications, and commits to reimburse the lender for any loans or related fees that were not collected from such customers. As of June 30, 2018, and December 31, 2017, the outstanding amount of active consumer loans guaranteed by the Company, which represents the Company’s maximum exposure, was $33,585 and $36,967, respectively. The outstanding amount of consumer loans with unaffiliated third-party lenders consist of $32,528 and $35,801 in short-term and $1,057 and $1,166 in installment loans at June 30, 2018, and December 31, 2017, respectively. The accrual for third party lender losses related to these obligations totaled $4,484 and $4,818 as of June 30, 2018, and December 31, 2017, respectively. This obligation is recorded as a current liability on the Company’s consolidated balance sheet. The Company has determined that the lenders are Variable Interest Entities (“VIEs”) but that the Company is not the primary beneficiary of the VIEs. Therefore, the Company has not consolidated either lender. |
Supplemental Guarantor Informat
Supplemental Guarantor Information | 6 Months Ended |
Jun. 30, 2018 | |
Supplemental Guarantor Information | |
Supplemental Guarantor Information | Note 14. Supplemental Guarantor Information The 2019 notes and the 2020 notes contain various covenants that, subject to certain exceptions defined in the indentures governing the notes (the “Indentures”), limit the Company’s ability to, among other things, engage in certain transactions with affiliates, pay dividends or distributions, redeem or repurchase capital stock, incur or assume liens or additional debt, and consolidate or merge with or into another entity or sell substantially all of its assets. The Company has optional redemption features on the 2019 notes and the 2020 notes prior to their maturity which, depending on the date of the redemption, would require premiums to be paid in addition to all principal and interest due. The 2019 notes and 2020 notes are guaranteed by all of the Company’s guarantor subsidiaries existing as of April 29, 2011 (the date the Company issued the 2019 notes) and any subsequent guarantor subsidiaries that guarantee the Company’s indebtedness or the indebtedness of any other subsidiary guarantor (the “Subsidiary Guarantors”), in accordance with the Indentures. The Company is a holding company and has no independent assets or operations of its own. The guarantees under the 2019 notes and 2020 notes are full, unconditional, and joint and several. There are no restrictions on the ability of the Company or any of the Subsidiary Guarantors to obtain funds from its restricted subsidiaries by dividend or loan, except for net worth requirements of certain states in which the Company operates. Certain Subsidiary Guarantors are required to maintain net worth ranging from $10 to $2,000. The total net worth requirements of these Subsidiary Guarantors is $4,555. The Indentures contain certain affirmative and negative covenants applicable to the Company and its Subsidiary Guarantors, including restrictions on their ability to incur additional indebtedness, consummate certain asset sales, make investments in certain entities that create liens on their assets, enter into certain affiliate transactions and make certain restricted payments, including restrictions on the Company’s ability to pay dividends on, or repurchase, its common stock. |
Supplemental Condensed Consolid
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information | 6 Months Ended |
Jun. 30, 2018 | |
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information | |
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information | Note 15. Supplemental Condensed Consolidating Guarantor and Non‑Guarantor Financial Information The following presents the condensed consolidating guarantor financial information as of June 30, 2018, and December 31, 2017, and for the six months ended June 30, 2018, and 2017, for the subsidiaries of the Company that serve as guarantors of the 2019 notes and the 2020 notes, and for the subsidiaries that do not serve as a guarantor. As of June 30, 2018, the non-guarantor subsidiaries are CCFI Funding LLC and CCFI Funding II LLC. During or prior to the first quarter of 2017, the following non-guarantor subsidiaries were dissolved; Direct Financial Solutions of UK Limited and its subsidiary Cash Central UK Limited, Direct Financial Solutions of Canada, Inc and its subsidiaries DFS-CC Financial Services LLC, DFS-CC Financial Services (Calgary) LLC and DFS-CC Financial Services (Toronto) LLC, and Direct Financial Solutions of Australia Pty Ltd and its subsidiary Cash Central of Australia Pty Ltd. The UK, Canada, and Australia entities, and their subsidiaries. The Florida II non-guarantor subsidiary was sold on February 1,2016. Each of the Company’s guarantor subsidiaries are 100% owned by the Company or its subsidiaries, and all guarantees are full, unconditional, and joint and several. Of the entities under “Non-Guarantor Subsidiaries” in the tables below, Florida II, CCFI Funding, and CCFI Funding II are “Unrestricted Subsidiaries” as defined in the Indentures. Buckeye Check Cashing of Florida II, LLC was acquired on July 31, 2012, and was sold on February 1, 2016, CCFI Funding was created on December 20, 2013, and CCFI Funding II was established on September 19, 2014. Refer to the “Non-Guarantor Subsidiaries” columns in the following condensed consolidating schedules. The remainder of the entities included under “Non-Guarantor Subsidiaries” in the tables below are “Restricted Subsidiaries” as defined in the Indentures governing the 2019 notes and the 2020 notes and, for the periods specified, did not have material assets, liabilities, revenue or expenses. Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Balance Sheets (unaudited) June 30, 2018 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets Cash and cash equivalents $ — $ 49,138 $ 11,028 $ — $ 60,166 Restricted cash — 4,370 — — 4,370 Finance receivables, net — 15,564 58,492 — 74,056 Card related pre-funding and receivables — 906 — — 906 Other current assets — 25,898 13,313 (21,677) 17,534 Total current assets — 95,876 82,833 (21,677) 157,032 Noncurrent Assets Investment in Subsidiaries 358,698 — — (358,698) — Finance receivables, net — 3,471 — — 3,471 Property, leasehold improvements and equipment, net — 23,339 — — 23,339 Other intangible assets — 485 — — 485 Security deposits — 2,153 — — 2,153 Total assets $ 358,698 $ 125,324 $ 82,833 $ (380,375) $ 186,480 Liabilities and Stockholders' Equity Current Liabilities Accounts payable and accrued liabilities $ — $ 31,572 $ 12,919 $ (11,294) $ 33,197 Money orders payable — 8,114 — — 8,114 Accrued interest 5,156 4 4,530 (4,530) 5,160 Current portion of capital lease obligation — 49 — — 49 Current portion of lines of credit 42,640 — — 42,640 Current portion of subsidiary note payable — 121 58,366 — 58,487 Current portion of senior secured notes 236,350 — — — 236,350 CCFI Funding notes — — 5,853 (5,853) — Deferred revenue — 2,535 — — 2,535 Total current liabilities 284,146 42,395 81,668 (21,677) 386,532 Noncurrent Liabilities Lease termination payable — 645 — — 645 Subsidiary note payable — 1,763 — — 1,763 Senior secured notes 12,374 — — — 12,374 Deferred revenue — 6,253 — — 6,253 Total liabilities 296,520 51,056 81,668 (21,677) 407,567 Stockholders' Equity (Deficit) 62,178 74,268 1,165 (358,698) (221,087) Total liabilities and stockholders' equity $ 358,698 $ 125,324 $ 82,833 $ (380,375) $ 186,480 Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Balance Sheets December 31, 2017 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets Cash and cash equivalents $ — $ 57,526 $ 9,101 $ — $ 66,627 Restricted cash — 4,585 — — 4,585 Finance receivables, net — 47,221 42,486 — 89,707 Card related pre-funding and receivables — 1,062 — — 1,062 Other current assets — 39,604 17,951 (42,284) 15,271 Total current assets — 149,998 69,538 (42,284) 177,252 Noncurrent Assets Investment in Subsidiaries 360,599 — — (360,599) — Finance receivables, net — 4,632 — — 4,632 Property, leasehold improvements and equipment, net — 26,848 — — 26,848 Other intangible assets — 924 — — 924 Security deposits — 2,750 — — 2,750 Total assets $ 360,599 $ 185,152 $ 69,538 $ (402,883) $ 212,406 Liabilities and Stockholders' Equity Current Liabilities Accounts payable and accrued liabilities $ — $ 57,696 $ 14,364 $ (32,494) $ 39,566 Money orders payable — 7,169 — — 7,169 Accrued interest 5,140 5 3,937 (3,937) 5,145 Current portion of capital lease obligation — 371 — — 371 Current portion of subsidiary note payable — 118 — — 118 CCFI Funding notes — — 5,853 (5,853) — Deferred revenue — 2,535 — — 2,535 Total current liabilities 5,140 67,894 24,154 (42,284) 54,904 Noncurrent Liabilities Lease termination payable — 818 — — 818 Lines of credit 45,129 — — — 45,129 Subsidiary note payable — 1,821 59,256 — 61,077 Senior secured notes 248,126 — — — 248,126 Deferred Revenue — 7,520 — — 7,520 Total liabilities 298,395 78,053 83,410 (42,284) 417,574 Stockholders' Equity (Deficit) 62,204 107,099 (13,872) (360,599) (205,168) Total liabilities and stockholders' equity $ 360,599 $ 185,152 $ 69,538 $ (402,883) $ 212,406 Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Income (unaudited) Six Months Ended June 30, 2018 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Finance receivable fees $ — $ $ $ — $ 97,242 Credit service fees — — — 36,687 Check cashing fees — — — 23,254 Card fees — — — 4,459 Dividend — — (1,500) — Other — (593) 7,334 Total revenues — (2,093) 168,976 Operating expenses: Salaries — — — 34,493 Provision for loan losses — — 45,458 Occupancy — — — 12,572 Advertising and marketing — — — 2,507 Lease termination costs — — — 566 Depreciation and amortization — — — 4,327 Other — — — 22,009 Total operating expenses — — 121,932 Operating gross profit — (2,093) 47,044 Corporate expenses — — 34,761 Intercompany management fee — — — Depreciation and amortization — — — 2,422 Interest expense, net (593) 25,797 Interest expense allocation (19,779) 19,779 — — — Total corporate and other expenses — (593) 62,980 Income (loss) before income taxes — (1,500) (15,936) Provision for income taxes — — — — — Net income (loss) $ — $ $ $ (1,500) $ (15,936) Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Income (unaudited) Six Months Ended June 30, 2017 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Finance receivable fees $ — $ $ $ — $ 96,981 Credit service fees — — — 33,285 Check cashing fees — — — 23,905 Card fees — — — 4,120 Dividend — — (11,000) — Other — (593) 8,229 Total revenues — (11,593) 166,520 Operating expenses: Salaries — — — 34,789 Provision for loan losses — — 43,399 Occupancy — — — 13,231 Advertising and marketing — — — 2,358 Lease termination costs — — — 991 Depreciation and amortization — — — 4,865 Other — — — 24,266 Total operating expenses — — 123,899 Operating gross profit — (11,593) 42,621 Corporate expenses — — 40,476 Intercompany management fee — — — Lease termination — — — 1,762 Depreciation and amortization — — — 2,490 Interest expense, net (593) 23,802 Interest expense allocation — — — Total corporate and other expenses — (593) 68,530 Income (loss) before income taxes — (11,000) (25,909) Provision (benefit) for income taxes — 284 666 Net income (loss) $ — $ (21,708) $ 6,417 $ (11,284) $ (26,575) Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Cash Flows (unaudited) Six Months Ended June 30, 2018 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Consolidated Net cash provided by (used in) operating activities $ 4,322 $ (22,264) $ 49,309 $ 31,367 Cash flows from investing activities Net receivables repaid (originated) — 17,114 (45,760) (28,646) Purchase of leasehold improvements and equipment — (3,072) — (3,072) Net cash provided by (used in) investing activities — 14,042 (45,760) (31,718) Cash flows from financing activities Payments on subsidiary note — (59) — (59) Payments on capital lease obligations — (322) — (322) Debt issuance costs (4,322) — (1,622) (5,944) Net cash used in financing activities (4,322) (381) (1,622) (6,325) Net increase (decrease) in cash and cash equivalents and restricted cash — (8,603) 1,927 (6,676) Cash and cash equivalents and restricted cash: Beginning — 62,111 9,101 71,212 Ending $ — $ 53,508 $ 11,028 $ 64,536 Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Cash Flows (unaudited) Six Months Ended June 30, 201 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Consolidated Net cash provided by (used in) operating activities $ (13,789) $ 31,715 $ 11,981 $ 29,907 Cash flows from investing activities Net receivables repaid (originated) — 1,623 (40,993) (39,370) Net acquired assets, net of cash — (117) — (117) Purchase of leasehold improvements and equipment — (3,501) — (3,501) Net cash used in investing activities — (1,995) (40,993) (42,988) Cash flows from financing activities Proceeds from subsidiary note — — 15,000 15,000 Payments on subsidiary note — (56) (7,300) (7,356) Payments on capital lease obligations, net — (540) — (540) Net proceeds (payments) on lines of credit 16,400 (2,250) — 14,150 Debt issuance costs (2,611) (1) (1,106) (3,718) Net cash provided by (used in) financing activities 13,789 (2,847) 6,594 17,536 Net increase (decrease) in cash and cash equivalents and restricted cash — 26,873 (22,418) 4,455 Cash and cash equivalents and restricted cash: Beginning — 74,792 34,556 109,348 Ending $ — $ 101,665 $ 12,138 $ 113,803 |
Ownership, Nature of Business23
Ownership, Nature of Business, and Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Ownership, Nature of Business, and Significant Accounting Policies | |
Basis of presentation | Basis of presentation: The accompanying interim unaudited consolidated financial statements of the Company have been prepared in accordance with the instructions to Form 10‑Q and accounting principles generally accepted in the United States (“GAAP”) for interim financial information. They do not include all information and footnotes required by GAAP for complete financial statements. Although management believes that the disclosures are adequate to prevent the information from being misleading, the interim unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2017, included in the Company’s Annual Report on Form 10‑K filed with the Securities & Exchange Commission on April 2, 2018. All adjustments, consisting of normal recurring adjustments, considered necessary for a fair statement of the Company’s financial condition, have been included. The results for any interim period are not necessarily indicative of results to be expected for the year ending December 31, 2018. |
Basis of consolidation | Basis of consolidation: The accompanying consolidated financial statements include the accounts of CCFI. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Business segments | Business segments: FASB Accounting Standards Codification (“ASC”) Topic 280 Segment Reporting requires that a public enterprise report a measure of segment profit or loss, certain specific revenue and expense items, segment assets, information about the way operating segments were determined and other items. The Company reports operating segments in accordance with FASB ASC Topic 280. Operating segments are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in determining how to allocate resources and assess performance. The Company operates in two segments: Retail financial services and Internet financial services. |
Equity method investments | Equity method investments: Entities and investments over which the Company exercises significant influence over the activities of the entity but which do not meet the requirements for consolidation are accounted for using the equity method of accounting pursuant to ASC 323, whereby the Company records its share of the underlying income or loss of these entities. Intercompany profit arising from transactions with affiliates is eliminated to the extent of its beneficial interest. Under the equity method of accounting for these investments, there is no recognition of losses once the carrying value of the investment, inclusive of advanced and loans, has been reduced to zero and there are no guarantee or funding obligations associated therewith. On September 30, 2017, the Company entered into a joint venture with a third party to offer insurance products through select retail locations in a certain market. The joint venture is managed by the third party. |
Revenue recognition | Revenue recognition: Transactions include loans, credit service fees, check cashing, bill payment, money transfer, money order sales, and other miscellaneous products and services. The full amount of the check cashing fee is recognized as revenue at the time of the transaction. Fees and direct costs incurred for the origination of loans are deferred and amortized over the loan period using the interest method. The Company acts in an agency capacity regarding bill payment services, money transfers, card products, and money orders offered and sold at its retail locations. The Company records the net amount retained as revenue because the supplier is the primary obligor in the arrangement, the amount earned by the Company is fixed, and the supplier is determined to have the ultimate credit risk. Revenue on loans determined to be troubled debt restructurings are recognized at the impaired loans’ original interest rates until the impaired loans are charged off or paid by the customer. Credit service organization (“CSO”) fees are recognized over the arranged credit service period. |
Finance receivables | Finance receivables: Finance receivables consist of short term and medium‑term consumer loans. Short-term consumer loans can be unsecured or secured with a maturity up to ninety days. Unsecured short-term loan products typically range in principal from $100 to $1,000, with a maturity between fourteen and thirty days, and include a written agreement to defer the presentment of the customer’s personal check or preauthorized debit for the aggregate amount of the advance plus fees. This form of lending is based on applicable laws and regulations, which vary by state. State statutes vary from charging fees of 15% to 20%, to charging interest at 25% per annum plus origination fees. The customers repay the cash advance by making cash payments or allowing a check or preauthorized debit to be presented. Secured consumer loans with a maturity of ninety days or less are included in this category and represented 12.8% and 14.5% of short-term consumer loans at June 30, 2018 and December 31, 2017, respectively. Medium-term consumer loans can be unsecured or secured with a maturity greater than ninety days and up to thirty-six months. Unsecured medium-term products typically range from $100 to $5,000, and are evidenced by a promissory note with a maturity between three and thirty-six months. These consumer loans vary in structure depending upon the applicable laws and regulations where they are offered. The medium-term consumer loans are payable in installments or provide for a line of credit with periodic payments. Secured consumer loans with a maturity greater than ninety days are included in this category and represented 14.5% and 12.6% of medium-term consumer loans at June 30, 2018, and December 31, 2017, respectively. |
Allowance for loan losses | Allowance for loan losses: Provisions for loan losses are charged to income in amounts sufficient to maintain an adequate allowance for loan losses and an adequate accrual for losses related to guaranteed loans processed for third-party lenders under the CSO programs. The factors used in assessing the overall adequacy of the allowance for loan losses, the accrual for losses related to guaranteed loans made by third-party lenders and the resulting provision for loan losses include an evaluation by product, by market based on historical loan loss experience, and delinquency of certain medium-term consumer loans. The Company evaluates various qualitative factors that may or may not affect the computed initial estimate of the allowance for loan losses, by using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. For short term unsecured consumer loans, the Company’s policy is to charge off loans when they become past due. The Company’s policy dictates that, where a customer has provided a check or ACH authorization for presentment upon the maturity of a loan, if the customer has not paid off the loan by the due date, the Company will deposit the customer’s check or draft the customer’s bank account for the amount due. If the check or draft is returned as unpaid, all accrued fees and outstanding principal are charged-off as uncollectible. For short term secured loans, the Company’s policy requires that balances be charged off when accounts are either thirty or sixty days past due depending on the product. For medium term secured and unsecured consumer loans that have a term of one year or less, the Company’s policy requires that balances be charged off when accounts are sixty days past due. For medium term secured and unsecured consumer loans that have an initial maturity of greater than one year, the Company’s policy requires that balances be charged off when accounts are ninety-one days past due. In certain markets, the Company reduced interest rates and favorably changed payment terms for medium-term consumer loans to assist borrowers in avoiding default and to mitigate risk of loss. These reduced interest rates and changed payment terms were limited to loans that the Company believed the customer had the ability to pay in the foreseeable future. These loans were accounted for as troubled debt restructurings and represent the only loans considered impaired due to the nature of the Company’s charge-off policy. Recoveries of amounts previously charged off are recorded to the allowance for loan losses or the accrual for third‑party losses in the period in which they are received. |
Lease termination payable | Lease termination payable: The Company records a liability in the consolidated balance sheets for the remaining lease obligations with the corresponding lease termination expense for closed retail locations disclosed in the operating expenses section, and closed corporate locations disclosed in the corporate and other expenses section, of the consolidated statements of operations, respectively. |
Fair value of financial instruments | Fair value of financial instruments: Financial assets and liabilities measured at fair value are grouped in three levels. The levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are: · Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities. · Level 2—Inputs other than quoted prices that are observable for assets and liabilities, either directly or indirectly. These inputs include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are less attractive. · Level 3—Unobservable inputs for assets and liabilities reflecting the reporting entity’s own assumptions. The Company follows the provisions of ASC 820‑10, Fair Value Measurements and Disclosures, which applies to all assets and liabilities that are being measured and reported on a fair value basis. ASC 820‑10 requires a disclosure that establishes a framework for measuring fair value within GAAP and expands the disclosure about fair value measurements. This standard enables a reader of consolidated financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. The standard requires that assets and liabilities carried at fair value be classified and disclosed in one of the three categories. In determining the appropriate levels, the Company performed a detailed analysis of the assets and liabilities that are subject to ASC 820-10. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs are classified as Level 3. The Company’s financial instruments consist primarily of cash and cash equivalents, finance receivables, restricted cash, and lines of credit. For all such instruments, other than senior secured notes and notes payable at June 30, 2018, and December 31, 2017, the carrying amounts in the consolidated financial statements approximate their fair values. Finance receivables are short term in nature and are originated at prevailing market rates and lines of credit bear interest at current market rates. The fair value of finance receivables at June 30, 2018 and December 31, 2017 approximates carrying value and is measured using internal valuation inputs including historical loan loss experience, delinquency, overall portfolio quality, and current economic conditions. The fair value of the Company’s 10.75% senior secured notes due 2019 (the “2019 notes”) and the 12.75% senior secured notes due 2020 (the “2020 notes”) were determined based on market yield on trades of the 2019 notes at the end of the recent reporting period. June 30, 2018 Carrying Amount Fair Value Level Financial assets: Cash and cash equivalents $ 60,166 $ 60,166 1 Restricted cash 4,370 4,370 1 Finance receivables 77,527 77,527 3 Financial liabilities: 10.75% Senior secured notes 237,290 175,595 1 12.75% Senior secured notes 12,500 6,777 2 Subsidiary Note payable 61,899 61,899 2 Line of Credit 47,000 47,000 2 December 31, 2017 Carrying Amount Fair Value Level Financial assets: Cash and cash equivalents $ 66,627 $ 66,627 1 Restricted cash 4,585 4,585 1 Finance receivables 94,339 94,339 3 Financial liabilities: 10.75% Senior secured notes 237,290 212,636 1 12.75% Senior secured notes 12,500 10,841 2 Subsidiary Note payable 61,958 61,958 2 Line of Credit 47,000 47,000 2 |
Treasury Stock | Treasury Stock: Treasury stock is reported at cost and consists of one million common shares at June 30, 2018 and December 31, 2017. |
Subsequent events | Subsequent events: The Company has evaluated its subsequent events (events occurring after June 30, 2018) through the issuance date of August 14, 2018. |
Ownership, Nature of Business24
Ownership, Nature of Business, and Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Ownership, Nature of Business, and Significant Accounting Policies | |
Schedule of estimated fair values of financial instruments | June 30, 2018 Carrying Amount Fair Value Level Financial assets: Cash and cash equivalents $ 60,166 $ 60,166 1 Restricted cash 4,370 4,370 1 Finance receivables 77,527 77,527 3 Financial liabilities: 10.75% Senior secured notes 237,290 175,595 1 12.75% Senior secured notes 12,500 6,777 2 Subsidiary Note payable 61,899 61,899 2 Line of Credit 47,000 47,000 2 December 31, 2017 Carrying Amount Fair Value Level Financial assets: Cash and cash equivalents $ 66,627 $ 66,627 1 Restricted cash 4,585 4,585 1 Finance receivables 94,339 94,339 3 Financial liabilities: 10.75% Senior secured notes 237,290 212,636 1 12.75% Senior secured notes 12,500 10,841 2 Subsidiary Note payable 61,958 61,958 2 Line of Credit 47,000 47,000 2 |
Finance Receivables, Credit Q25
Finance Receivables, Credit Quality Information and Allowance for Loan Losses (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | |
Schedule of finance receivables representing amounts due from customers for advances | June 30, December 31, 2018 2017 Short-term consumer loans $ 57,530 $ 66,465 Medium-term consumer loans 37,187 46,903 Gross receivables $ 94,717 $ 113,368 Unearned advance fees, net of deferred loan origination costs (2,633) (2,702) Finance receivables before allowance for loan losses 92,084 110,666 Allowance for loan losses (14,557) (16,327) Finance receivables, net $ 77,527 $ 94,339 Finance receivables, net Current portion $ 74,056 $ 89,707 Non-current portion 3,471 4,632 Total finance receivables, net $ 77,527 $ 94,339 |
Schedule of changes in the allowance for loan losses by product type | Allowance as Balance Balance Receivables a percentage 4/1/2018 Provision Charge-Offs Recoveries 6/30/2018 6/30/2018 of receivables Short-term consumer loans $ 2,318 $ 8,699 $ (15,617) $ 7,231 $ 2,631 $ 57,530 4.57 % Medium-term consumer loans 12,485 6,084 (7,677) 1,034 11,926 37,187 32.07 % $ 14,803 $ 14,783 $ (23,294) $ 8,265 $ 14,557 $ 94,717 15.37 % Allowance as Balance Balance Receivables a percentage 1/1/2018 Provision Charge-Offs Recoveries 6/30/2018 6/30/2018 of receivables Short-term consumer loans $ 2,697 $ 16,858 $ (34,041) $ 17,117 $ 2,631 $ 57,530 4.57 % Medium-term consumer loans 13,630 14,481 (18,744) 2,559 11,926 37,187 32.07 % $ 16,327 $ 31,339 $ (52,785) $ 19,676 $ 14,557 $ 94,717 15.37 % Allowance as Balance Balance Receivables a percentage 4/1/2017 Provision Charge-Offs Recoveries 6/30/2017 6/30/2017 of receivable Short-term consumer loans $ 1,846 $ 9,393 $ (19,902) $ 11,219 $ 2,556 $ 63,638 4.02 % Medium-term consumer loans 11,163 8,007 (9,854) 1,080 10,396 42,119 24.68 % $ 13,009 $ 17,400 $ (29,756) $ 12,299 $ 12,952 $ 105,757 12.25 % Allowance as Balance Balance Receivables a percentage 1/1/2017 Provision Charge-Offs Recoveries 6/30/2017 6/30/2017 of receivable Short-term consumer loans $ 2,223 $ 15,826 $ (39,036) $ 23,543 $ 2,556 $ 63,638 4.02 % Medium-term consumer loans 13,996 15,228 (21,833) 3,005 10,396 42,119 24.68 % $ 16,219 $ 31,054 $ (60,869) $ 26,548 $ 12,952 $ 105,757 12.25 % |
Schedule of changes in the accrual for third-party lender losses | Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Short-term balance, beginning of period $ $ $ $ Provision for loan losses Charge-offs, net Short-term balance, end of period $ $ $ $ Medium-term balance, beginning of period $ $ $ $ Provision for loan losses Charge-offs, net Medium-term balance, end of period $ $ $ $ Total balance, beginning of period $ $ $ $ Provision for loan losses Charge-offs, net Total balance, end of period $ $ $ $ |
Schedule of aging of receivables | June 30, 2018 December 31, 2017 Current finance receivables $ 85,733 90.5 % $ 101,102 89.2 % Past due finance receivables (1 - 30 days) Short-term consumer loans 1,325 1.4 % 2,046 1.8 % Medium-term consumer loans 4,709 5.0 % 6,502 5.7 % Total past due finance receivables (1 - 30 days) 6,034 6.4 % 8,548 7.5 % Past due finance receivables (31 - 60 days) Medium-term consumer loans 2,208 2.3 % 3,130 2.8 % Total past due finance receivables (31 - 60 days) 2,208 2.3 % 3,130 2.8 % Past due finance receivables (61 - 90 days) Medium-term consumer loans 742 0.8 % 588 0.5 % Total past due finance receivables (61 - 90 days) 742 0.8 % 588 0.5 % Total delinquent 8,984 9.5 % 12,266 10.8 % $ 94,717 % $ 113,368 % |
Pledged Assets and Debt (Tables
Pledged Assets and Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Pledged Assets and Debt | |
Schedule of lines of credit | June 30, 2018 December 31, 2017 Deferred Deferred Issuance Net Issuance Net Principal Costs Principal Principal Costs Principal $47,000 Revolving credit, secured, interest rate as defined below, due April 2019, collateralized by all Guarantor Company assets $ 47,000 $ 4,360 $ 42,640 $ 47,000 $ 1,871 $ 45,129 47,000 4,360 42,640 47,000 1,871 45,129 Less current maturities 47,000 4,360 42,640 — — — Long-term portion $ — $ — $ — $ 47,000 $ 1,871 $ 45,129 |
Schedule of senior secured notes payable | June 30, 2018 December 31, 2017 Deferred Deferred Issuance Net Issuance Net Principal Costs Principal Principal Costs Principal $395,000 Senior Note payable, 10.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2019 $ 237,290 $ 940 $ 236,350 $ 237,290 $ 1,504 $ 235,786 $25,000 Senior Note payable, 12.75 %, collateralized by all Guarantor Company assets, semi-annual interest payments with principal due May 2020 12,500 126 12,374 12,500 160 12,340 249,790 1,066 248,724 249,790 1,664 248,126 Less current maturities 237,290 940 236,350 — — — Long-term portion $ 12,500 $ 126 $ 12,374 $ 249,790 $ 1,664 $ 248,126 |
Schedule of subsidiary note payable | June 30, 2018 December 31, 2017 Deferred Deferred Issuance Net Issuance Net Principal Costs Principal Principal Costs Principal $60,000 Note, secured, 16.75%, collateralized by acquired loans, due April 2019 $ 60,000 $ 1,634 $ 58,366 $ 60,000 $ 744 $ 59,256 $1,425 Term note, secured, 4.25%, collateralized by financed asset, due July 2019 852 3 849 882 5 877 $1,165 Term note, secured, 4.50%, collateralized by financed asset, due May 2021 1,047 12 1,035 1,076 14 1,062 61,899 1,649 60,250 61,958 763 61,195 Less current maturities 60,122 1,635 58,487 119 1 118 Long-term portion $ 1,777 $ 14 $ 1,763 $ 61,839 $ 762 $ 61,077 |
Accounts Payable and Accrued 27
Accounts Payable and Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounts Payable and Accrued Liabilities | |
Schedule of accounts payable and accrued liabilities | June 30, December 31, 2018 2017 Accounts payable $ 4,330 $ 5,465 Accrued payroll and compensated absences 5,266 7,718 Wire transfers payable 1,738 2,238 Accrual for third-party losses 4,484 4,818 Unearned CSO Fees 7,730 8,029 Deferred rent 716 867 Bill payment service liability 2,260 2,604 Lease termination 1,602 1,978 Other 5,071 5,849 $ 33,197 $ 39,566 |
Concentrations of Credit Risks
Concentrations of Credit Risks (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Concentrations of Credit Risks | |
Summary of allocation of portfolio balance by state | June 30, 2018 December 31, 2017 Balance Percentage of Balance Percentage of State Outstanding Total Outstanding Outstanding Total Outstanding Alabama $ 11,025 % $ 12,808 % Arizona 10,511 11,994 California 32,753 39,835 Mississippi 6,782 7,409 Virginia 10,309 12,018 Other retail segment states 16,974 19,696 Other internet segment states 6,363 9,608 Total $ 94,717 100.0 % $ 113,368 100.0 % |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Stock Based Compensation | |
Schedule of stock option activity | Stock option activity for the six months ended June 30, 2018, is as follows (these amounts have not been rounded in thousands): Weighted-Average Aggregate Exercise Price Weighted-Average Intrinsic (actual per Remaining Value Shares share price) Contractual Term (thousands) Outstanding at December 31, 2017 1,332,632 $ 2.25 8.5 N/A Granted 76,559 1.00 8.3 N/A Exercised — — — N/A Forfeited or expired — — — N/A Outstanding at June 30, 2018 1,409,191 $ 2.18 8.3 N/A Exercisable at June 30, 2018 1,277,737 $ 2.25 8.2 $ — Vested or expected to vest at June 30, 2018 1,409,191 $ 2.18 8.3 $ — |
Business Segment (Tables)
Business Segment (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Business Segments | |
Summary of financial information of segments | As of and for the three months ended June 30, 2018 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 160,566 $ 25,914 $ 186,480 Other Intangible Assets 103 382 485 Total Revenues $ 68,920 100.0 % $ 12,405 100.0 % $ 81,325 100.0 % Provision for Loan Losses 17,162 24.9 % 5,661 45.6 % 22,823 28.0 % Other Operating Expenses 36,570 53.1 % 2,073 16.7 % 38,643 47.5 % Operating Gross Profit 15,188 22.0 % 4,671 37.7 % 19,859 24.5 % Interest Expense, net 10,514 15.3 % 3,105 25.0 % 13,619 16.7 % Depreciation and Amortization 1,236 1.8 % 93 0.7 % 1,329 1.6 % Other Corporate Expenses (a) — — 17,159 17,159 21.1 % Income (loss) from Continuing Operations, before tax 3,438 5.0 % 1,473 11.9 % (17,159) (12,248) (15.1) % (a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated. As of and for the six months ended June 30, 2018 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 160,566 $ 25,914 $ 186,480 Other Intangible Assets 103 382 485 Total Revenues $ 141,717 100.0 % $ 27,259 100.0 % $ 168,976 100.0 % Provision for Loan Losses 32,782 23.1 % 12,676 46.5 % 45,458 26.9 % Other Operating Expenses 72,861 51.4 % 3,613 13.3 % 76,474 45.3 % Operating Gross Profit 36,074 25.5 % 10,970 40.2 % 47,044 27.8 % Interest Expense, net 19,993 14.1 % 5,804 21.3 % 25,797 15.3 % Depreciation and Amortization 2,236 1.6 % 186 0.7 % 2,422 1.5 % Other Corporate Expenses (a) — — — — 34,761 34,761 20.6 % Income (Loss) from Continuing Operations, before tax 13,845 9.8 % 4,980 18.3 % (34,761) (15,936) (9.4) % (a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated. As of and for the three months ended June 30, 2017 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 333,345 $ 35,802 $ 369,147 Goodwill 113,499 — 113,499 Other Intangible Assets 449 716 1,165 Total Revenues $ 65,726 100.0 % $ 15,442 100.0 % $ 81,168 100.0 % Provision for Loan Losses 15,402 23.4 % 8,457 54.8 % 23,859 29.4 % Other Operating Expenses 39,358 59.9 % 1,926 12.4 % 41,284 50.9 % Operating Gross Profit 10,966 16.7 % 5,059 32.8 % 16,025 19.7 % Interest Expense, net 8,687 13.2 % 3,744 24.2 % 12,431 15.3 % Depreciation and Amortization 1,093 1.7 % 88 0.6 % 1,181 1.5 % Other Corporate Expenses (a) — — — 20,290 20,290 25.0 % Income (loss) from Continuing Operations, before tax 1,186 1.8 % 1,227 7.9 % (20,290) (17,877) (22.0) % (a) Represents expenses not associated directly with operations that are not allocated between reportable segments. Therefore, the Company has elected to disclose other corporate expenses as unallocated. As of and for the six months ended June 30, 2017 Retail Internet Unallocated Financial % of Financial % of (Income) % of Services Revenue Services Revenue Expenses Consolidated Revenue Total Assets $ 333,345 $ 35,802 $ 369,147 Goodwill 113,499 — 113,499 Other Intangible Assets 449 716 1,165 Total Revenues $ 134,417 100.0 % $ 32,103 100.0 % $ 166,520 100.0 % Provision for Loan Losses 27,460 20.4 % 15,939 49.6 % 43,399 26.1 % Other Operating Expenses 77,564 57.7 % 2,936 9.2 % 80,500 48.3 % Operating Gross Profit 29,393 21.9 % 13,228 41.2 % 42,621 25.6 % Interest Expense, net 16,053 11.9 % 7,749 24.1 % 23,802 14.3 % Depreciation and Amortization 2,222 1.7 % 268 0.8 % 2,490 1.5 % Lease termination Expenses — — 1,762 5.5 % 1,762 1.1 % Other Corporate Expenses (a) — — — — 40,476 40,476 24.3 % Income (loss) from Continuing Operations, before tax 11,118 8.3 % 3,449 10.7 % (40,476) (25,909) (15.6) % (a) |
Supplemental Condensed Consol31
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information | |
Schedule of condensed consolidating balance sheet | Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Balance Sheets (unaudited) June 30, 2018 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets Cash and cash equivalents $ — $ 49,138 $ 11,028 $ — $ 60,166 Restricted cash — 4,370 — — 4,370 Finance receivables, net — 15,564 58,492 — 74,056 Card related pre-funding and receivables — 906 — — 906 Other current assets — 25,898 13,313 (21,677) 17,534 Total current assets — 95,876 82,833 (21,677) 157,032 Noncurrent Assets Investment in Subsidiaries 358,698 — — (358,698) — Finance receivables, net — 3,471 — — 3,471 Property, leasehold improvements and equipment, net — 23,339 — — 23,339 Other intangible assets — 485 — — 485 Security deposits — 2,153 — — 2,153 Total assets $ 358,698 $ 125,324 $ 82,833 $ (380,375) $ 186,480 Liabilities and Stockholders' Equity Current Liabilities Accounts payable and accrued liabilities $ — $ 31,572 $ 12,919 $ (11,294) $ 33,197 Money orders payable — 8,114 — — 8,114 Accrued interest 5,156 4 4,530 (4,530) 5,160 Current portion of capital lease obligation — 49 — — 49 Current portion of lines of credit 42,640 — — 42,640 Current portion of subsidiary note payable — 121 58,366 — 58,487 Current portion of senior secured notes 236,350 — — — 236,350 CCFI Funding notes — — 5,853 (5,853) — Deferred revenue — 2,535 — — 2,535 Total current liabilities 284,146 42,395 81,668 (21,677) 386,532 Noncurrent Liabilities Lease termination payable — 645 — — 645 Subsidiary note payable — 1,763 — — 1,763 Senior secured notes 12,374 — — — 12,374 Deferred revenue — 6,253 — — 6,253 Total liabilities 296,520 51,056 81,668 (21,677) 407,567 Stockholders' Equity (Deficit) 62,178 74,268 1,165 (358,698) (221,087) Total liabilities and stockholders' equity $ 358,698 $ 125,324 $ 82,833 $ (380,375) $ 186,480 Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Balance Sheets December 31, 2017 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Assets Current Assets Cash and cash equivalents $ — $ 57,526 $ 9,101 $ — $ 66,627 Restricted cash — 4,585 — — 4,585 Finance receivables, net — 47,221 42,486 — 89,707 Card related pre-funding and receivables — 1,062 — — 1,062 Other current assets — 39,604 17,951 (42,284) 15,271 Total current assets — 149,998 69,538 (42,284) 177,252 Noncurrent Assets Investment in Subsidiaries 360,599 — — (360,599) — Finance receivables, net — 4,632 — — 4,632 Property, leasehold improvements and equipment, net — 26,848 — — 26,848 Other intangible assets — 924 — — 924 Security deposits — 2,750 — — 2,750 Total assets $ 360,599 $ 185,152 $ 69,538 $ (402,883) $ 212,406 Liabilities and Stockholders' Equity Current Liabilities Accounts payable and accrued liabilities $ — $ 57,696 $ 14,364 $ (32,494) $ 39,566 Money orders payable — 7,169 — — 7,169 Accrued interest 5,140 5 3,937 (3,937) 5,145 Current portion of capital lease obligation — 371 — — 371 Current portion of subsidiary note payable — 118 — — 118 CCFI Funding notes — — 5,853 (5,853) — Deferred revenue — 2,535 — — 2,535 Total current liabilities 5,140 67,894 24,154 (42,284) 54,904 Noncurrent Liabilities Lease termination payable — 818 — — 818 Lines of credit 45,129 — — — 45,129 Subsidiary note payable — 1,821 59,256 — 61,077 Senior secured notes 248,126 — — — 248,126 Deferred Revenue — 7,520 — — 7,520 Total liabilities 298,395 78,053 83,410 (42,284) 417,574 Stockholders' Equity (Deficit) 62,204 107,099 (13,872) (360,599) (205,168) Total liabilities and stockholders' equity $ 360,599 $ 185,152 $ 69,538 $ (402,883) $ 212,406 |
Schedule of consolidated statements of operations | Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Income (unaudited) Six Months Ended June 30, 2018 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Finance receivable fees $ — $ $ $ — $ 97,242 Credit service fees — — — 36,687 Check cashing fees — — — 23,254 Card fees — — — 4,459 Dividend — — (1,500) — Other — (593) 7,334 Total revenues — (2,093) 168,976 Operating expenses: Salaries — — — 34,493 Provision for loan losses — — 45,458 Occupancy — — — 12,572 Advertising and marketing — — — 2,507 Lease termination costs — — — 566 Depreciation and amortization — — — 4,327 Other — — — 22,009 Total operating expenses — — 121,932 Operating gross profit — (2,093) 47,044 Corporate expenses — — 34,761 Intercompany management fee — — — Depreciation and amortization — — — 2,422 Interest expense, net (593) 25,797 Interest expense allocation (19,779) 19,779 — — — Total corporate and other expenses — (593) 62,980 Income (loss) before income taxes — (1,500) (15,936) Provision for income taxes — — — — — Net income (loss) $ — $ $ $ (1,500) $ (15,936) Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Income (unaudited) Six Months Ended June 30, 2017 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Eliminations Consolidated Revenues: Finance receivable fees $ — $ $ $ — $ 96,981 Credit service fees — — — 33,285 Check cashing fees — — — 23,905 Card fees — — — 4,120 Dividend — — (11,000) — Other — (593) 8,229 Total revenues — (11,593) 166,520 Operating expenses: Salaries — — — 34,789 Provision for loan losses — — 43,399 Occupancy — — — 13,231 Advertising and marketing — — — 2,358 Lease termination costs — — — 991 Depreciation and amortization — — — 4,865 Other — — — 24,266 Total operating expenses — — 123,899 Operating gross profit — (11,593) 42,621 Corporate expenses — — 40,476 Intercompany management fee — — — Lease termination — — — 1,762 Depreciation and amortization — — — 2,490 Interest expense, net (593) 23,802 Interest expense allocation — — — Total corporate and other expenses — (593) 68,530 Income (loss) before income taxes — (11,000) (25,909) Provision (benefit) for income taxes — 284 666 Net income (loss) $ — $ (21,708) $ 6,417 $ (11,284) $ (26,575) |
Schedule of condensed consolidating statement of cash flows | Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Cash Flows (unaudited) Six Months Ended June 30, 2018 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Consolidated Net cash provided by (used in) operating activities $ 4,322 $ (22,264) $ 49,309 $ 31,367 Cash flows from investing activities Net receivables repaid (originated) — 17,114 (45,760) (28,646) Purchase of leasehold improvements and equipment — (3,072) — (3,072) Net cash provided by (used in) investing activities — 14,042 (45,760) (31,718) Cash flows from financing activities Payments on subsidiary note — (59) — (59) Payments on capital lease obligations — (322) — (322) Debt issuance costs (4,322) — (1,622) (5,944) Net cash used in financing activities (4,322) (381) (1,622) (6,325) Net increase (decrease) in cash and cash equivalents and restricted cash — (8,603) 1,927 (6,676) Cash and cash equivalents and restricted cash: Beginning — 62,111 9,101 71,212 Ending $ — $ 53,508 $ 11,028 $ 64,536 Community Choice Financial Inc. and Subsidiaries Condensed Consolidating Statements of Cash Flows (unaudited) Six Months Ended June 30, 201 Community Guarantor Non ‑ Guarantor Choice Financial Subsidiaries Subsidiaries Consolidated Net cash provided by (used in) operating activities $ (13,789) $ 31,715 $ 11,981 $ 29,907 Cash flows from investing activities Net receivables repaid (originated) — 1,623 (40,993) (39,370) Net acquired assets, net of cash — (117) — (117) Purchase of leasehold improvements and equipment — (3,501) — (3,501) Net cash used in investing activities — (1,995) (40,993) (42,988) Cash flows from financing activities Proceeds from subsidiary note — — 15,000 15,000 Payments on subsidiary note — (56) (7,300) (7,356) Payments on capital lease obligations, net — (540) — (540) Net proceeds (payments) on lines of credit 16,400 (2,250) — 14,150 Debt issuance costs (2,611) (1) (1,106) (3,718) Net cash provided by (used in) financing activities 13,789 (2,847) 6,594 17,536 Net increase (decrease) in cash and cash equivalents and restricted cash — 26,873 (22,418) 4,455 Cash and cash equivalents and restricted cash: Beginning — 74,792 34,556 109,348 Ending $ — $ 101,665 $ 12,138 $ 113,803 |
Ownership, Nature of Business32
Ownership, Nature of Business, and Significant Accounting Policies (Details) | 6 Months Ended |
Jun. 30, 2018locationsegmentstate | |
Nature of business | |
Number of retail locations owned and operated | location | 478 |
Number of states in which stores are operated | 12 |
Number of states in which the Company had an internet presence | 30 |
Business Segments | |
Number of operating segments | segment | 2 |
Ownership, Nature of Business33
Ownership, Nature of Business, and Significant Accounting Policies - Financing Receivables (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Medium term loans up to one year | ||
Finance receivables | ||
Maturity period of loan, for loan balances to be charged-off when accounts are past due by stipulated period | 1 year | |
Period of past due when accounts are required to be charged-off | 60 days | |
Medium term loans greater than one year | ||
Finance receivables | ||
Maturity period of loan, for loan balances to be charged-off when accounts are past due by stipulated period | 1 year | |
Minimum | Secured short term loan | ||
Finance receivables | ||
Period of past due when accounts are required to be charged-off | 30 days | |
Maximum | Secured short term loan | ||
Finance receivables | ||
Period of past due when accounts are required to be charged-off | 60 days | |
Maximum | Medium term loans greater than one year | ||
Finance receivables | ||
Period of past due when accounts are required to be charged-off | 91 days | |
Consumer Borrower | Secured short term loan | ||
Finance receivables | ||
Fee per $.1 borrowed (as a percent) | 12.80% | 14.50% |
Consumer Borrower | Unsecured short term loan | ||
Finance receivables | ||
Interest rate on loan products (as a percent) | 25.00% | |
Consumer Borrower | Secured Medium Term Loan | ||
Finance receivables | ||
Maturity period of promissory note | 90 days | |
Fee per $.1 borrowed (as a percent) | 14.50% | 12.60% |
Consumer Borrower | Minimum | Secured short term loan | ||
Finance receivables | ||
Maturity period of promissory note | 90 days | |
Consumer Borrower | Minimum | Unsecured short term loan | ||
Finance receivables | ||
Consumer loan products | $ 100 | |
Maturity period of promissory note | 14 days | |
Fee per $.1 borrowed (as a percent) | 15.00% | |
Consumer Borrower | Minimum | Medium-term consumer loans | ||
Finance receivables | ||
Maturity period of promissory note | 90 days | |
Consumer Borrower | Minimum | Unsecured Medium Term Loan | ||
Finance receivables | ||
Consumer loan products | $ 100 | |
Maturity period of promissory note | 3 months | |
Consumer Borrower | Maximum | Short-term consumer loans | ||
Finance receivables | ||
Maturity period of promissory note | 90 days | |
Consumer Borrower | Maximum | Unsecured short term loan | ||
Finance receivables | ||
Consumer loan products | $ 1,000 | |
Maturity period of promissory note | 30 days | |
Fee per $.1 borrowed (as a percent) | 20.00% | |
Consumer Borrower | Maximum | Medium-term consumer loans | ||
Finance receivables | ||
Maturity period of promissory note | 36 months | |
Consumer Borrower | Maximum | Unsecured Medium Term Loan | ||
Finance receivables | ||
Consumer loan products | $ 5,000 | |
Maturity period of promissory note | 36 months |
Ownership, Nature of Business34
Ownership, Nature of Business, and Significant Accounting Policies - Estimated fair values of financial instruments (Details) - USD ($) $ in Thousands, shares in Millions | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Financial assets: | ||||
Restricted cash | $ 4,370 | $ 4,585 | $ 3,230 | $ 3,015 |
Treasury stock. | ||||
Shares held in treasury stock | 1 | 1 | ||
Level 1 | Carrying Amount | ||||
Financial assets: | ||||
Cash and cash equivalents | $ 60,166 | $ 66,627 | ||
Restricted cash | 4,370 | 4,585 | ||
Level 1 | Fair Value | ||||
Financial assets: | ||||
Cash and cash equivalents | 60,166 | 66,627 | ||
Restricted cash | 4,370 | 4,585 | ||
Level 2 | Carrying Amount | ||||
Financial liabilities: | ||||
Lines of Credit | 47,000 | 47,000 | ||
Level 2 | Fair Value | ||||
Financial liabilities: | ||||
Lines of Credit | 47,000 | 47,000 | ||
Level 3 | Carrying Amount | ||||
Financial assets: | ||||
Finance receivables | 77,527 | 94,339 | ||
Level 3 | Fair Value | ||||
Financial assets: | ||||
Finance receivables | 77,527 | 94,339 | ||
Subsidiary notes payable | Level 2 | Carrying Amount | ||||
Financial liabilities: | ||||
Notes payable | 61,899 | 61,958 | ||
Subsidiary notes payable | Level 2 | Fair Value | ||||
Financial liabilities: | ||||
Notes payable | $ 61,899 | 61,958 | ||
10.75% senior secured notes due 2019 | Level 1 | Carrying Amount | ||||
Financial liabilities: | ||||
Notes payable | 237,290 | |||
10.75% senior secured notes due 2019 | Level 1 | Fair Value | ||||
Financial liabilities: | ||||
Notes payable | $ 212,636 | |||
10.75% senior secured notes due 2019 | Senior secured notes payable | ||||
Estimated fair values of financial instruments | ||||
Interest rate (as a percent) | 10.75% | 10.75% | ||
10.75% senior secured notes due 2019 | Senior secured notes payable | Level 1 | Carrying Amount | ||||
Financial liabilities: | ||||
Notes payable | $ 237,290 | |||
10.75% senior secured notes due 2019 | Senior secured notes payable | Level 1 | Fair Value | ||||
Financial liabilities: | ||||
Notes payable | $ 175,595 | |||
12.75% senior secured notes due 2020 | Level 2 | Carrying Amount | ||||
Financial liabilities: | ||||
Notes payable | $ 12,500 | |||
12.75% senior secured notes due 2020 | Level 2 | Fair Value | ||||
Financial liabilities: | ||||
Notes payable | $ 10,841 | |||
12.75% senior secured notes due 2020 | Senior secured notes payable | ||||
Estimated fair values of financial instruments | ||||
Interest rate (as a percent) | 12.75% | 12.75% | ||
12.75% senior secured notes due 2020 | Senior secured notes payable | Level 2 | Carrying Amount | ||||
Financial liabilities: | ||||
Notes payable | $ 12,500 | |||
12.75% senior secured notes due 2020 | Senior secured notes payable | Level 2 | Fair Value | ||||
Financial liabilities: | ||||
Notes payable | $ 6,777 |
Finance Receivables, Credit Q35
Finance Receivables, Credit Quality Information and Allowance for Loan Losses (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | ||||||
Gross receivables | $ 94,717 | $ 105,757 | ||||
Allowance for loan losses | (14,557) | $ (14,803) | $ (16,327) | (12,952) | $ (13,009) | $ (16,219) |
Finance receivables, net | 77,527 | 94,339 | ||||
Consumer Borrower | ||||||
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | ||||||
Gross receivables | 94,717 | 113,368 | ||||
Unearned advance fees, net of deferred loan origination costs | (2,633) | (2,702) | ||||
Finance receivables before allowance for loan losses | 92,084 | 110,666 | ||||
Allowance for loan losses | (14,557) | (16,327) | ||||
Finance receivables, net | 77,527 | 94,339 | ||||
Short-term consumer loans | Consumer Borrower | ||||||
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | ||||||
Gross receivables | 57,530 | 66,465 | 63,638 | |||
Allowance for loan losses | (2,631) | (2,318) | (2,697) | (2,556) | (1,846) | (2,223) |
Medium-term consumer loans | Consumer Borrower | ||||||
Finance Receivables, Credit Quality Information and Allowance for Loan Losses | ||||||
Gross receivables | 37,187 | 46,903 | 42,119 | |||
Allowance for loan losses | $ (11,926) | $ (12,485) | $ (13,630) | $ (10,396) | $ (11,163) | $ (13,996) |
Finance Receivables, Credit Q36
Finance Receivables, Credit Quality Information and Allowance for Loan Losses - Finance receivables (net), current and non-current portion (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Finance receivables, net | ||
Finance receivables, net Current portion | $ 74,056 | $ 89,707 |
Finance receivables, net Non-current portion | 3,471 | 4,632 |
Finance receivables, net | $ 77,527 | $ 94,339 |
Finance Receivables, Credit Q37
Finance Receivables, Credit Quality Information and Allowance for Loan Losses - Changes in the allowance for the loan losses by product type (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | $ 14,803 | $ 13,009 | $ 16,327 | $ 16,219 | |
Provision | 14,783 | 17,400 | 31,339 | 31,054 | |
Charge-offs | (23,294) | (29,756) | (52,785) | (60,869) | |
Recoveries | 8,265 | 12,299 | 19,676 | 26,548 | |
Balance at the end of the period | 14,557 | 12,952 | 14,557 | 12,952 | |
Total Finance receivables at the end of the period | $ 94,717 | $ 105,757 | $ 94,717 | $ 105,757 | |
Allowance as a percentage of receivable | 15.37% | 12.25% | 15.37% | 12.25% | |
Allowance for TDR's | $ 22,823 | $ 23,859 | $ 45,458 | $ 43,399 | |
Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | 3,768 | 2,691 | 4,818 | 3,099 | |
Provision | 6,711 | 4,764 | 11,728 | 9,251 | |
Charge-offs | (5,995) | (4,354) | (12,062) | (9,249) | |
Balance at the end of the period | 4,484 | 3,101 | 4,484 | 3,101 | |
Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | 16,327 | ||||
Balance at the end of the period | 14,557 | 14,557 | |||
Total Finance receivables at the end of the period | 94,717 | 94,717 | $ 113,368 | ||
Troubled debt restructuring | |||||
Changes in the allowance for the loan losses by product type | |||||
Allowance for TDR's | 10 | 7 | 16 | 11 | |
Net carrying value of TDR's | 13 | 22 | 26 | 37 | |
Credit service program (CSO Program) | Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Debt sales | 375 | 62 | 585 | 243 | |
Total gross finance receivables for which accrual for third-party lender losses has been recorded | 33,585 | 33,585 | 36,967 | ||
Short-term consumer loans | Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | 3,580 | 2,571 | 4,570 | 2,907 | |
Provision | 6,641 | 4,642 | 11,579 | 9,070 | |
Charge-offs | (5,949) | (4,268) | (11,877) | (9,032) | |
Balance at the end of the period | 4,272 | 2,945 | 4,272 | 2,945 | |
Short-term consumer loans | Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | 2,318 | 1,846 | 2,697 | 2,223 | |
Provision | 8,699 | 9,393 | 16,858 | 15,826 | |
Charge-offs | (15,617) | (19,902) | (34,041) | (39,036) | |
Recoveries | 7,231 | 11,219 | 17,117 | 23,543 | |
Balance at the end of the period | 2,631 | 2,556 | 2,631 | 2,556 | |
Total Finance receivables at the end of the period | $ 57,530 | $ 63,638 | $ 57,530 | $ 63,638 | 66,465 |
Allowance as a percentage of receivable | 4.57% | 4.02% | 4.57% | 4.02% | |
Debt sales | $ 412 | $ 347 | $ 823 | $ 437 | |
Short-term consumer loans | Ohio credit service program (CSO Program) | |||||
Changes in the allowance for the loan losses by product type | |||||
Recoveries | 6,836 | 2,868 | 16,677 | 8,282 | |
Short-term consumer loans | Ohio credit service program (CSO Program) | Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | 29,284 | 29,284 | 31,341 | ||
Short-term consumer loans | Ohio credit service program (CSO Program) | Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Required purchases | 11,237 | 5,280 | 24,421 | 13,393 | |
Short-term consumer loans | Texas credit service program (CSO Program) | |||||
Changes in the allowance for the loan losses by product type | |||||
Recoveries | 837 | 1,442 | 2,274 | 3,174 | |
Short-term consumer loans | Texas credit service program (CSO Program) | Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | 3,244 | 3,244 | 4,460 | ||
Required purchases | 2,450 | 3,565 | 6,104 | 7,020 | |
Medium-term consumer loans | Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | 188 | 120 | 248 | 192 | |
Provision | 70 | 122 | 149 | 181 | |
Charge-offs | (46) | (86) | (185) | (217) | |
Balance at the end of the period | 212 | 156 | 212 | 156 | |
Medium-term consumer loans | Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Balance at the beginning of the period | 12,485 | 11,163 | 13,630 | 13,996 | |
Provision | 6,084 | 8,007 | 14,481 | 15,228 | |
Charge-offs | (7,677) | (9,854) | (18,744) | (21,833) | |
Recoveries | 1,034 | 1,080 | 2,559 | 3,005 | |
Balance at the end of the period | 11,926 | 10,396 | 11,926 | 10,396 | |
Total Finance receivables at the end of the period | $ 37,187 | $ 42,119 | $ 37,187 | $ 42,119 | 46,903 |
Allowance as a percentage of receivable | 32.07% | 24.68% | 32.07% | 24.68% | |
Debt sales | $ 216 | $ 224 | $ 778 | $ 599 | |
Medium-term consumer loans | Troubled debt restructuring | Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Provision and write off | 21 | 21 | 41 | 34 | |
Payment defaults for loans evaluated for impairment | 67 | 29 | 121 | 319 | |
Medium-term consumer loans | Ohio credit service program (CSO Program) | |||||
Changes in the allowance for the loan losses by product type | |||||
Recoveries | 87 | 72 | 147 | 145 | |
Medium-term consumer loans | Ohio credit service program (CSO Program) | Third party lender | |||||
Changes in the allowance for the loan losses by product type | |||||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | 1,057 | 1,057 | $ 1,166 | ||
Medium-term consumer loans | Ohio credit service program (CSO Program) | Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Required purchases | 139 | 159 | 336 | 363 | |
Check cashing | Consumer Borrower | |||||
Changes in the allowance for the loan losses by product type | |||||
Provision | $ 1,329 | $ 1,695 | $ 2,391 | $ 3,094 |
Finance Receivables, Credit Q38
Finance Receivables, Credit Quality Information and Allowance for Loan Losses - Aging of receivables (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 |
Past due finance receivables | |||
Gross receivables | $ 94,717 | $ 105,757 | |
Consumer Borrower | |||
Aging of receivables | |||
Current finance receivables | $ 85,733 | $ 101,102 | |
Current finance receivables (as a percent) | 90.50% | 89.20% | |
Past due finance receivables | |||
Total past due finance receivables (1 - 30 days) | $ 6,034 | $ 8,548 | |
Total past due finance receivables (1 - 30 days) (as a percent) | 6.40% | 7.50% | |
Total past due finance receivables (31 - 60 days) | $ 2,208 | $ 3,130 | |
Total past due finance receivables (31 - 60 days) (as a percent) | 2.30% | 2.80% | |
Total past due finance receivables (61 - 90 days) | $ 742 | $ 588 | |
Total past due finance receivables (61 - 90 days) (as a percent) | 0.80% | 0.50% | |
Total delinquent | $ 8,984 | $ 12,266 | |
Total delinquent (as a percent) | 9.50% | 10.80% | |
Gross receivables | $ 94,717 | $ 113,368 | |
Gross receivables (as a percent) | 100.00% | 100.00% | |
Consumer Borrower | Short-term consumer loans | |||
Past due finance receivables | |||
Total past due finance receivables (1 - 30 days) | $ 1,325 | $ 2,046 | |
Total past due finance receivables (1 - 30 days) (as a percent) | 1.40% | 1.80% | |
Gross receivables | $ 57,530 | $ 66,465 | 63,638 |
Consumer Borrower | Medium-term consumer loans | |||
Past due finance receivables | |||
Total past due finance receivables (1 - 30 days) | $ 4,709 | $ 6,502 | |
Total past due finance receivables (1 - 30 days) (as a percent) | 5.00% | 5.70% | |
Total past due finance receivables (31 - 60 days) | $ 2,208 | $ 3,130 | |
Total past due finance receivables (31 - 60 days) (as a percent) | 2.30% | 2.80% | |
Total past due finance receivables (61 - 90 days) | $ 742 | $ 588 | |
Total past due finance receivables (61 - 90 days) (as a percent) | 0.80% | 0.50% | |
Gross receivables | $ 37,187 | $ 46,903 | $ 42,119 |
Related Party Transactions an39
Related Party Transactions and Balances (Details) | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Related Party Transactions and Balances | |
Related party transaction | $ 0 |
Other Intangible Assets (Detail
Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Other Intangible Assets | ||||
Intangible amortization expense | $ 316 | $ 126 | $ 439 | $ 250 |
Other intangible assets | $ 0 | $ 0 |
Pledged Assets and Debt - Line
Pledged Assets and Debt - Line of Credit Facility (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Line of Credit Facility | ||
Less current maturities | $ 42,640 | |
Line of credit, noncurrent | $ 45,129 | |
Revolving credit due April 2019 | ||
Line of Credit Facility | ||
Maximum borrowing capacity | 47,000 | |
Revolving credit facility | ||
Line of Credit Facility | ||
Principal | 47,000 | 47,000 |
Principal, current | 47,000 | |
Principal, noncurrent | 47,000 | |
Deferred issuance costs | 4,360 | 1,871 |
Deferred issuance costs, current | 4,360 | 0 |
Deferred Issuance costs, noncurrent | 0 | 1,871 |
Line of credit | 42,640 | 45,129 |
Less current maturities | 42,640 | |
Line of credit, noncurrent | 45,129 | |
Revolving credit facility | Revolving credit due April 2019 | ||
Line of Credit Facility | ||
Principal | 47,000 | 47,000 |
Deferred issuance costs | 4,360 | 1,871 |
Line of credit | 42,640 | $ 45,129 |
Maximum borrowing capacity | $ 47,000 | |
Prime rate | ||
Line of Credit Facility | ||
Interest rate at the end of period (as a percent) | 5.00% | 4.50% |
3-Month LIBOR | ||
Line of Credit Facility | ||
Variable rate basis | 3-month LIBOR | 3-month LIBOR |
Interest rate at the end of period (as a percent) | 2.34% | 1.69% |
3-Month LIBOR | Revolving credit facility | ||
Line of Credit Facility | ||
Margin (as a percent) | 11.00% |
Pledged Assets and Debt - Senio
Pledged Assets and Debt - Senior secured notes payable (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Senior secure notes payable | ||
Net principal, Current | $ 236,350 | |
Net principal, Noncurrent | 12,374 | $ 248,126 |
Senior secured notes payable | ||
Senior secure notes payable | ||
Deferred issuance costs | 1,066 | 1,664 |
Deferred issuance costs, current | 940 | 0 |
Deferred Issuance costs, noncurrent | 126 | 1,664 |
Principal | 249,790 | 249,790 |
Principal, Current | 237,290 | |
Principal, Noncurrent | 12,500 | 249,790 |
Net principal | 248,724 | 248,126 |
Net principal, Current | 236,350 | |
Net principal, Noncurrent | 12,374 | 248,126 |
Senior secured notes payable | 10.75% senior secured notes due 2019 | ||
Senior secure notes payable | ||
Maximum borrowing capacity | $ 395,000 | |
Interest rate (as a percent) | 10.75% | |
Deferred issuance costs | $ 940 | 1,504 |
Principal | 237,290 | 237,290 |
Net principal | 236,350 | $ 235,786 |
Senior secured notes payable | 12.75% senior secured notes due 2020 | ||
Senior secure notes payable | ||
Maximum borrowing capacity | $ 25,000 | |
Interest rate (as a percent) | 12.75% | 12.75% |
Deferred issuance costs | $ 126 | $ 160 |
Principal | 12,500 | 12,500 |
Net principal | $ 12,374 | $ 12,340 |
Pledged Assets and Debt - Subsi
Pledged Assets and Debt - Subsidiary notes payable (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2018 | Mar. 30, 2018 | Dec. 31, 2017 | |
Debt | |||
Net principal, current | $ 58,487 | $ 118 | |
Net principal, noncurrent | 1,763 | 61,077 | |
Revolving credit due April 2019 | |||
Debt | |||
Maximum borrowing capacity | 47,000 | ||
Subsidiary notes payable | |||
Debt | |||
Principal | 61,899 | 61,958 | |
Principal, current | 60,122 | 119 | |
Principal, noncurrent | 1,777 | 61,839 | |
Deferred issuance costs | 1,649 | 763 | |
Deferred issuance costs, current | 1,635 | 1 | |
Deferred Issuance costs, noncurrent | 14 | 762 | |
Net principal | 60,250 | 61,195 | |
Net principal, current | 58,487 | 118 | |
Net principal, noncurrent | 1,763 | 61,077 | |
Subsidiary notes payable | Note, secured, due April 2019 | |||
Debt | |||
Principal | 60,000 | 60,000 | |
Deferred issuance costs | 1,634 | 744 | |
Net principal | 58,366 | 59,256 | |
Face amount of debt | $ 60,000 | ||
Interest rate (as a percent) | 16.75% | ||
Maximum borrowing capacity | $ 60,000 | ||
Administrative fee | 0.95% | ||
Subsidiary notes payable | Term note, secured, due July 2019 | |||
Debt | |||
Principal | $ 852 | 882 | |
Deferred issuance costs | 3 | 5 | |
Net principal | 849 | 877 | |
Face amount of debt | $ 1,425 | ||
Interest rate (as a percent) | 4.25% | ||
Subsidiary notes payable | Term Note, secured, due May 2021 | |||
Debt | |||
Principal | $ 1,047 | 1,076 | |
Deferred issuance costs | 12 | 14 | |
Net principal | 1,035 | 1,062 | |
Face amount of debt | $ 1,165 | ||
Interest rate (as a percent) | 4.50% | ||
Senior secured notes payable | |||
Debt | |||
Deferred issuance costs | $ 1,066 | 1,664 | |
Deferred issuance costs, current | 940 | 0 | |
Deferred Issuance costs, noncurrent | 126 | 1,664 | |
Principal | $ 249,790 | $ 249,790 | |
Senior secured notes payable | 10.75% senior secured notes due 2019 | |||
Debt | |||
Interest rate (as a percent) | 10.75% | 10.75% | |
Principal | $ 237,290 |
Accounts Payable and Accrued 44
Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Accounts Payable and Accrued Liabilities | ||
Accounts payable | $ 4,330 | $ 5,465 |
Accrued payroll and compensated absences | 5,266 | 7,718 |
Wire transfers payable | 1,738 | 2,238 |
Accrual for third-party losses | 4,484 | 4,818 |
Unearned CSO fees | 7,730 | 8,029 |
Deferred rent | 716 | 867 |
Bill payment service liability | 2,260 | 2,604 |
Lease termination | 1,602 | 1,978 |
Other | 5,071 | 5,849 |
Accounts payable and accrued liabilities | $ 33,197 | $ 39,566 |
Operating and Capital Lease C45
Operating and Capital Lease Commitments and Total Rental Expense- Rental expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Mar. 31, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Operating and Capital Lease Commitments and Total Rental Expense | |||||
Rental expense, including maintenance and real estate tax expense | $ 6,535 | $ 6,908 | $ 13,195 | $ 13,942 | |
Lease termination cost | $ 1,762 | ||||
Reduction in lease commitments | $ 0 |
Concentrations of Credit Risk46
Concentrations of Credit Risks (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Third party lender | Credit service program (CSO Program) | ||
Concentration of credit risks | ||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | $ 33,585 | $ 36,967 |
Finance receivables | Geographic concentration risk | ||
Concentration of credit risks | ||
Balance Outstanding | $ 94,717 | $ 113,368 |
Percentage of Total Outstanding | 100.00% | 100.00% |
Finance receivables | Geographic concentration risk | Alabama | ||
Concentration of credit risks | ||
Balance Outstanding | $ 11,025 | $ 12,808 |
Percentage of Total Outstanding | 11.60% | 11.30% |
Finance receivables | Geographic concentration risk | Arizona | ||
Concentration of credit risks | ||
Balance Outstanding | $ 10,511 | $ 11,994 |
Percentage of Total Outstanding | 11.10% | 10.60% |
Finance receivables | Geographic concentration risk | California | ||
Concentration of credit risks | ||
Balance Outstanding | $ 32,753 | $ 39,835 |
Percentage of Total Outstanding | 34.60% | 35.10% |
Finance receivables | Geographic concentration risk | Mississippi | ||
Concentration of credit risks | ||
Balance Outstanding | $ 6,782 | $ 7,409 |
Percentage of Total Outstanding | 7.20% | 6.50% |
Finance receivables | Geographic concentration risk | Virginia | ||
Concentration of credit risks | ||
Balance Outstanding | $ 10,309 | $ 12,018 |
Percentage of Total Outstanding | 10.90% | 10.60% |
Finance receivables | Geographic concentration risk | Other retail segment states | ||
Concentration of credit risks | ||
Balance Outstanding | $ 16,974 | $ 19,696 |
Percentage of Total Outstanding | 17.90% | 17.40% |
Finance receivables | Geographic concentration risk | Other Internet Segment States | ||
Concentration of credit risks | ||
Balance Outstanding | $ 6,363 | $ 9,608 |
Percentage of Total Outstanding | 6.70% | 8.50% |
Short-term consumer loans | Third party lender | Ohio credit service program (CSO Program) | ||
Concentration of credit risks | ||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | $ 29,284 | $ 31,341 |
Short-term consumer loans | Third party lender | Texas credit service program (CSO Program) | ||
Concentration of credit risks | ||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | 3,244 | 4,460 |
Medium-term consumer loans | Third party lender | Ohio credit service program (CSO Program) | ||
Concentration of credit risks | ||
Total gross finance receivables for which accrual for third-party lender losses has been recorded | $ 1,057 | $ 1,166 |
Stock Based Compensation - (Det
Stock Based Compensation - (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2017 | |
Additional disclosure | |||
Stock-based compensation costs | $ 17 | $ 32 | |
Unrecognized stock-based compensation costs to be recognized over future periods | 49 | 66 | $ 66 |
Unrecognized stock-based compensation costs to be recognized in future periods for awards that vest over requisite service period | $ 49 | ||
Weighted average period over which unrecognized stock-based compensation costs are expected to be recognized, for awards that vest over requisite service period or upon change in control | 1 year 7 months 6 days | ||
Income tax benefit recognized in the consolidated statements of operations for share-based compensation arrangements | $ 5 | $ 9 | |
Stock options | |||
Stock based compensation | |||
Granted (in shares) | 76,559 | ||
Granted (in dollars per share) | $ 1 | ||
Shares | |||
Outstanding at the beginning of the period (in shares) | 1,332,632 | ||
Granted (in shares) | 76,559 | ||
Outstanding at the end of the period (in shares) | 1,409,191 | 1,332,632 | 1,332,632 |
Exercisable at the end of the period (in shares) | 1,277,737 | ||
Vested or expected to vest at the end of the period (in shares) | 1,409,191 | ||
Weighted-Average Exercise Price (actual per share price) | |||
Outstanding at the beginning of the period (in dollars per share) | $ 2.25 | ||
Granted (in dollars per share) | 1 | ||
Outstanding at the end of the period (in dollars per share) | 2.18 | $ 2.25 | $ 2.25 |
Exercisable at the end of the period (in dollars per share) | 2.25 | ||
Vested or expected to vest at the end of the period (in dollars per share) | $ 2.18 | ||
Weighted-Average Remaining Contractual Term | |||
Outstanding | 8 years 3 months 18 days | 8 years 6 months | |
Granted | 8 years 3 months 18 days | ||
Exercisable at the end of the period | 8 years 2 months 12 days | ||
Vested or expected to vest at the end of the period | 8 years 3 months 18 days |
Business Segments (Details)
Business Segments (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)segment | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Business segment | |||||
Number of operating segments | segment | 2 | ||||
Total Assets | $ 186,480 | $ 369,147 | $ 186,480 | $ 369,147 | $ 212,406 |
Goodwill | 113,499 | 113,499 | |||
Other Intangible Assets | 485 | 1,165 | 485 | 1,165 | $ 924 |
Total Revenues | $ 81,325 | $ 81,168 | $ 168,976 | $ 166,520 | |
Total Revenues, % of Revenue | 100.00% | 100.00% | 100.00% | 100.00% | |
Provision for loan losses | $ 22,823 | $ 23,859 | $ 45,458 | $ 43,399 | |
Provision for Loan Losses, % of Revenue | 28.00% | 29.40% | 26.90% | 26.10% | |
Other Operating Expenses | $ 38,643 | $ 41,284 | $ 76,474 | $ 80,500 | |
Other Operating Expenses, % of Revenue | 47.50% | 50.90% | 45.30% | 48.30% | |
Operating Gross Profit | $ 19,859 | $ 16,025 | $ 47,044 | $ 42,621 | |
Operating Gross Profit, % of Revenue | 24.50% | 19.70% | 27.80% | 25.60% | |
Interest Expense, net | $ 13,619 | $ 12,431 | $ 25,797 | $ 23,802 | |
Interest Expense, net, % of Revenue | 16.70% | 15.30% | 15.30% | 14.30% | |
Depreciation and Amortization | $ 1,329 | $ 1,181 | $ 2,422 | $ 2,490 | |
Depreciation and Amortization, % of Revenue | 1.60% | 1.50% | 1.50% | 1.50% | |
Lease termination | $ 1,762 | ||||
Lease termination Expenses, % of Revenue | 1.10% | ||||
Other Corporate Expenses | $ 17,159 | $ 20,290 | $ 34,761 | $ 40,476 | |
Other Corporate Expenses, % of Revenue | 21.10% | 25.00% | 20.60% | 24.30% | |
Loss from continuing operations, before tax | $ (12,248) | $ (17,877) | $ (15,936) | $ (25,909) | |
Income from Continuing Operations, before tax, % of Revenue | (15.10%) | (22.00%) | (9.40%) | (15.60%) | |
Unallocated (Income) Expenses | |||||
Business segment | |||||
Other Corporate Expenses | $ 17,159 | $ 20,290 | $ 34,761 | $ 40,476 | |
Loss from continuing operations, before tax | (17,159) | (20,290) | (34,761) | (40,476) | |
Retail Financial Services | |||||
Business segment | |||||
Total Assets | 160,566 | 333,345 | 160,566 | 333,345 | |
Goodwill | 113,499 | 113,499 | |||
Other Intangible Assets | 103 | 449 | 103 | 449 | |
Total Revenues | $ 68,920 | $ 65,726 | $ 141,717 | $ 134,417 | |
Total Revenues, % of Revenue | 100.00% | 100.00% | 100.00% | 100.00% | |
Provision for loan losses | $ 17,162 | $ 15,402 | $ 32,782 | $ 27,460 | |
Provision for Loan Losses, % of Revenue | 24.90% | 23.40% | 23.10% | 20.40% | |
Other Operating Expenses | $ 36,570 | $ 39,358 | $ 72,861 | $ 77,564 | |
Other Operating Expenses, % of Revenue | 53.10% | 59.90% | 51.40% | 57.70% | |
Operating Gross Profit | $ 15,188 | $ 10,966 | $ 36,074 | $ 29,393 | |
Operating Gross Profit, % of Revenue | 22.00% | 16.70% | 25.50% | 21.90% | |
Interest Expense, net | $ 10,514 | $ 8,687 | $ 19,993 | $ 16,053 | |
Interest Expense, net, % of Revenue | 15.30% | 13.20% | 14.10% | 11.90% | |
Depreciation and Amortization | $ 1,236 | $ 1,093 | $ 2,236 | $ 2,222 | |
Depreciation and Amortization, % of Revenue | 1.80% | 1.70% | 1.60% | 1.70% | |
Loss from continuing operations, before tax | $ 3,438 | $ 1,186 | $ 13,845 | $ 11,118 | |
Income from Continuing Operations, before tax, % of Revenue | 5.00% | 1.80% | 9.80% | 8.30% | |
Internet Financial Services | |||||
Business segment | |||||
Total Assets | $ 25,914 | $ 35,802 | $ 25,914 | $ 35,802 | |
Other Intangible Assets | 382 | 716 | 382 | 716 | |
Total Revenues | $ 12,405 | $ 15,442 | $ 27,259 | $ 32,103 | |
Total Revenues, % of Revenue | 100.00% | 100.00% | 100.00% | 100.00% | |
Provision for loan losses | $ 5,661 | $ 8,457 | $ 12,676 | $ 15,939 | |
Provision for Loan Losses, % of Revenue | 45.60% | 54.80% | 46.50% | 49.60% | |
Other Operating Expenses | $ 2,073 | $ 1,926 | $ 3,613 | $ 2,936 | |
Other Operating Expenses, % of Revenue | 16.70% | 12.40% | 13.30% | 9.20% | |
Operating Gross Profit | $ 4,671 | $ 5,059 | $ 10,970 | $ 13,228 | |
Operating Gross Profit, % of Revenue | 37.70% | 32.80% | 40.20% | 41.20% | |
Interest Expense, net | $ 3,105 | $ 3,744 | $ 5,804 | $ 7,749 | |
Interest Expense, net, % of Revenue | 25.00% | 24.20% | 21.30% | 24.10% | |
Depreciation and Amortization | $ 93 | $ 88 | $ 186 | $ 268 | |
Depreciation and Amortization, % of Revenue | 0.70% | 0.60% | 0.70% | 0.80% | |
Lease termination | $ 1,762 | ||||
Lease termination Expenses, % of Revenue | 5.50% | ||||
Loss from continuing operations, before tax | $ 1,473 | $ 1,227 | $ 4,980 | $ 3,449 | |
Income from Continuing Operations, before tax, % of Revenue | 11.90% | 7.90% | 18.30% | 10.70% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Income Taxes | ||
Liability recorded for unrecognized tax benefits | $ 0 | $ 0 |
Gross deferred tax assets | 76,464 | 71,896 |
Valuation allowance | 76,464 | $ 71,896 |
Credits or net operating losses | $ 0 |
Transactions with Variable In50
Transactions with Variable Interest Entities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Variable Interest Entities | ||
Accrual for third-party losses | $ 4,484 | $ 4,818 |
Insight Holdings | ||
Variable Interest Entities | ||
Outstanding amount of active third party consumer loans | 33,585 | 36,967 |
Accrual for third-party losses | 4,484 | 4,818 |
Short-term consumer loans | Insight Holdings | ||
Variable Interest Entities | ||
Outstanding amount of active third party consumer loans | 32,528 | 35,801 |
Medium-term consumer loans | Insight Holdings | ||
Variable Interest Entities | ||
Outstanding amount of active third party consumer loans | $ 1,057 | $ 1,166 |
Supplemental Guarantor Inform51
Supplemental Guarantor Information (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
CCFI | |
Supplemental guarantor information | |
Independent assets | $ 0 |
Independent operations | 0 |
Guarantor Subsidiaries | Financial guarantee | 2019 and 2020 Notes | |
Supplemental guarantor information | |
Total net worth requirements | 4,555 |
Guarantor Subsidiaries | Financial guarantee | Minimum | 2019 and 2020 Notes | |
Supplemental guarantor information | |
Net worth required to be maintained | 10 |
Guarantor Subsidiaries | Financial guarantee | Maximum | 2019 and 2020 Notes | |
Supplemental guarantor information | |
Net worth required to be maintained | $ 2,000 |
Supplemental Condensed Consol52
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information (Details) | Jun. 30, 2018 |
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information | |
Ownership interest (as a percent) | 100.00% |
Supplemental Condensed Consol53
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Current Assets | ||||
Cash and cash equivalents | $ 60,166 | $ 66,627 | $ 110,573 | $ 106,333 |
Restricted cash | 4,370 | 4,585 | 3,230 | $ 3,015 |
Finance receivables, net | 74,056 | 89,707 | ||
Card related pre-funding and receivables | 906 | 1,062 | ||
Other current assets | 17,534 | 15,271 | ||
Total current assets | 157,032 | 177,252 | ||
Noncurrent Assets | ||||
Finance receivables, net | 3,471 | 4,632 | ||
Property, leasehold improvements and equipment, net | 23,339 | 26,848 | ||
Goodwill | 113,499 | |||
Other intangible assets | 485 | 924 | 1,165 | |
Security deposits | 2,153 | 2,750 | ||
Total assets | 186,480 | 212,406 | $ 369,147 | |
Current Liabilities | ||||
Accounts payable and accrued liabilities | 33,197 | 39,566 | ||
Money orders payable | 8,114 | 7,169 | ||
Accrued interest | 5,160 | 5,145 | ||
Current portion of capital lease obligation | 49 | 371 | ||
Less current maturities | 42,640 | |||
Current portion of subsidiary note payable | 58,487 | 118 | ||
Current portion of senior secured notes | 236,350 | |||
Deferred revenue | 2,535 | 2,535 | ||
Total current liabilities | 386,532 | 54,904 | ||
Noncurrent Liabilities | ||||
Lease termination payable | 645 | 818 | ||
Lines of credit | 45,129 | |||
Subsidiary note payable | 1,763 | 61,077 | ||
Senior secured notes | 12,374 | 248,126 | ||
Deferred Revenue | 6,253 | 7,520 | ||
Total liabilities | 407,567 | 417,574 | ||
Stockholders' Equity (Deficit) | ||||
Total stockholders' deficit | (221,087) | (205,168) | ||
Total liabilities and stockholders' equity | 186,480 | 212,406 | ||
Eliminations | ||||
Current Assets | ||||
Other current assets | (21,677) | (42,284) | ||
Total current assets | (21,677) | (42,284) | ||
Noncurrent Assets | ||||
Investment in Subsidiaries | (358,698) | (360,599) | ||
Total assets | (380,375) | (402,883) | ||
Current Liabilities | ||||
Accounts payable and accrued liabilities | (11,294) | (32,494) | ||
Accrued interest | (4,530) | (3,937) | ||
CCFI funding notes | (5,853) | (5,853) | ||
Total current liabilities | (21,677) | (42,284) | ||
Noncurrent Liabilities | ||||
Total liabilities | (21,677) | (42,284) | ||
Stockholders' Equity (Deficit) | ||||
Total stockholders' deficit | (358,698) | (360,599) | ||
Total liabilities and stockholders' equity | (380,375) | (402,883) | ||
Community Choice Financial | Reportable legal entities | ||||
Noncurrent Assets | ||||
Investment in Subsidiaries | 358,698 | 360,599 | ||
Total assets | 358,698 | 360,599 | ||
Current Liabilities | ||||
Accrued interest | 5,156 | 5,140 | ||
Less current maturities | 42,640 | |||
Current portion of senior secured notes | 236,350 | |||
Total current liabilities | 284,146 | 5,140 | ||
Noncurrent Liabilities | ||||
Lines of credit | 45,129 | |||
Senior secured notes | 12,374 | 248,126 | ||
Total liabilities | 296,520 | 298,395 | ||
Stockholders' Equity (Deficit) | ||||
Total stockholders' deficit | 62,178 | 62,204 | ||
Total liabilities and stockholders' equity | 358,698 | 360,599 | ||
Guarantor Subsidiaries | Reportable legal entities | ||||
Current Assets | ||||
Cash and cash equivalents | 49,138 | 57,526 | ||
Restricted cash | 4,370 | 4,585 | ||
Finance receivables, net | 15,564 | 47,221 | ||
Card related pre-funding and receivables | 906 | 1,062 | ||
Other current assets | 25,898 | 39,604 | ||
Total current assets | 95,876 | 149,998 | ||
Noncurrent Assets | ||||
Finance receivables, net | 3,471 | 4,632 | ||
Property, leasehold improvements and equipment, net | 23,339 | 26,848 | ||
Other intangible assets | 485 | 924 | ||
Security deposits | 2,153 | 2,750 | ||
Total assets | 125,324 | 185,152 | ||
Current Liabilities | ||||
Accounts payable and accrued liabilities | 31,572 | 57,696 | ||
Money orders payable | 8,114 | 7,169 | ||
Accrued interest | 4 | 5 | ||
Current portion of capital lease obligation | 49 | 371 | ||
Current portion of subsidiary note payable | 121 | 118 | ||
Deferred revenue | 2,535 | 2,535 | ||
Total current liabilities | 42,395 | 67,894 | ||
Noncurrent Liabilities | ||||
Lease termination payable | 645 | 818 | ||
Subsidiary note payable | 1,763 | 1,821 | ||
Deferred Revenue | 6,253 | 7,520 | ||
Total liabilities | 51,056 | 78,053 | ||
Stockholders' Equity (Deficit) | ||||
Total stockholders' deficit | 74,268 | 107,099 | ||
Total liabilities and stockholders' equity | 125,324 | 185,152 | ||
Non-Guarantor Subsidiaries | Reportable legal entities | ||||
Current Assets | ||||
Cash and cash equivalents | 11,028 | 9,101 | ||
Finance receivables, net | 58,492 | 42,486 | ||
Other current assets | 13,313 | 17,951 | ||
Total current assets | 82,833 | 69,538 | ||
Noncurrent Assets | ||||
Total assets | 82,833 | 69,538 | ||
Current Liabilities | ||||
Accounts payable and accrued liabilities | 12,919 | 14,364 | ||
Accrued interest | 4,530 | 3,937 | ||
Current portion of subsidiary note payable | 58,366 | |||
CCFI funding notes | 5,853 | 5,853 | ||
Total current liabilities | 81,668 | 24,154 | ||
Noncurrent Liabilities | ||||
Subsidiary note payable | 59,256 | |||
Total liabilities | 81,668 | 83,410 | ||
Stockholders' Equity (Deficit) | ||||
Total stockholders' deficit | 1,165 | (13,872) | ||
Total liabilities and stockholders' equity | $ 82,833 | $ 69,538 |
Supplemental Condensed Consol54
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Consolidated Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues: | ||||
Total Revenues | $ 81,325 | $ 81,168 | $ 168,976 | $ 166,520 |
Corporate and other expenses: | ||||
Salaries | 17,361 | 17,516 | 34,493 | 34,789 |
Provision for loan losses | 22,823 | 23,859 | 45,458 | 43,399 |
Occupancy | 6,229 | 6,602 | 12,572 | 13,231 |
Advertising and marketing | 1,496 | 1,544 | 2,507 | 2,358 |
Lease termination costs | 469 | 944 | 566 | 991 |
Depreciation and amortization | 2,104 | 2,327 | 4,327 | 4,865 |
Other | 10,984 | 12,351 | 22,009 | 24,266 |
Total operating expenses | 61,466 | 65,143 | 121,932 | 123,899 |
Operating gross profit | 19,859 | 16,025 | 47,044 | 42,621 |
Corporate expenses | 17,159 | 20,290 | 34,761 | 40,476 |
Lease termination | 1,762 | |||
Depreciation and amortization | 1,329 | 1,181 | 2,422 | 2,490 |
Interest expense, net | 13,619 | 12,431 | 25,797 | 23,802 |
Total corporate and other expenses | 32,107 | 33,902 | 62,980 | 68,530 |
Loss from continuing operations, before tax | (12,248) | (17,877) | (15,936) | (25,909) |
Provision (benefit) for income taxes | 333 | 666 | ||
Net loss | (12,248) | (18,210) | (15,936) | (26,575) |
Eliminations | ||||
Revenues: | ||||
Dividend | (1,500) | (11,000) | ||
Total Revenues | (2,093) | (11,593) | ||
Corporate and other expenses: | ||||
Operating gross profit | (2,093) | (11,593) | ||
Interest expense, net | (593) | (593) | ||
Total corporate and other expenses | (593) | (593) | ||
Loss from continuing operations, before tax | (1,500) | (11,000) | ||
Provision (benefit) for income taxes | 284 | |||
Net loss | (1,500) | (11,284) | ||
Community Choice Financial | Reportable legal entities | ||||
Corporate and other expenses: | ||||
Interest expense, net | 19,779 | 18,471 | ||
Interest expense allocation | (19,779) | (18,471) | ||
Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Dividend | 1,500 | 11,000 | ||
Total Revenues | 114,962 | 152,667 | ||
Corporate and other expenses: | ||||
Salaries | 34,493 | 34,789 | ||
Provision for loan losses | 15,704 | 30,935 | ||
Occupancy | 12,572 | 13,231 | ||
Advertising and marketing | 2,507 | 2,358 | ||
Lease termination costs | 566 | 991 | ||
Depreciation and amortization | 4,327 | 4,865 | ||
Other | 22,009 | 24,266 | ||
Total operating expenses | 92,178 | 111,435 | ||
Operating gross profit | 22,784 | 41,232 | ||
Corporate expenses | 34,503 | 40,293 | ||
Intercompany management fee | (3,059) | (1,023) | ||
Lease termination | 1,762 | |||
Depreciation and amortization | 2,422 | 2,490 | ||
Interest expense, net | 233 | 403 | ||
Interest expense allocation | 19,779 | 18,471 | ||
Total corporate and other expenses | 53,878 | 62,396 | ||
Loss from continuing operations, before tax | (31,094) | (21,164) | ||
Provision (benefit) for income taxes | 544 | |||
Net loss | (31,094) | (21,708) | ||
Non-Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 56,107 | 25,446 | ||
Corporate and other expenses: | ||||
Provision for loan losses | 29,754 | 12,464 | ||
Total operating expenses | 29,754 | 12,464 | ||
Operating gross profit | 26,353 | 12,982 | ||
Corporate expenses | 258 | 183 | ||
Intercompany management fee | 3,059 | 1,023 | ||
Interest expense, net | 6,378 | 5,521 | ||
Total corporate and other expenses | 9,695 | 6,727 | ||
Loss from continuing operations, before tax | 16,658 | 6,255 | ||
Provision (benefit) for income taxes | (162) | |||
Net loss | 16,658 | 6,417 | ||
Finance receivable fees | ||||
Revenues: | ||||
Total Revenues | 46,310 | 47,930 | 97,242 | 96,981 |
Finance receivable fees | Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 41,527 | 71,671 | ||
Finance receivable fees | Non-Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 55,715 | 25,310 | ||
Credit service fees | ||||
Revenues: | ||||
Total Revenues | 17,491 | 15,146 | 36,687 | 33,285 |
Credit service fees | Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 36,687 | 33,285 | ||
Check cashing fees | ||||
Revenues: | ||||
Total Revenues | 11,562 | 11,779 | 23,254 | 23,905 |
Check cashing fees | Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 23,254 | 23,905 | ||
Card fees | ||||
Revenues: | ||||
Total Revenues | 2,511 | 2,113 | 4,459 | 4,120 |
Card fees | Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 4,459 | 4,120 | ||
Other | ||||
Revenues: | ||||
Total Revenues | $ 3,451 | $ 4,200 | 7,334 | 8,229 |
Other | Eliminations | ||||
Revenues: | ||||
Total Revenues | (593) | (593) | ||
Other | Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | 7,535 | 8,686 | ||
Other | Non-Guarantor Subsidiaries | Reportable legal entities | ||||
Revenues: | ||||
Total Revenues | $ 392 | $ 136 |
Supplemental Condensed Consol55
Supplemental Condensed Consolidating Guarantor and Non-Guarantor Financial Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Condensed Consolidating Statement of Cash Flows | ||||
Net cash provided by operating activities | $ 31,367 | $ 29,907 | ||
Cash flows from investing activities | ||||
Net receivables repaid (originated) | (28,646) | (39,370) | ||
Net acquired assets, net of cash | (117) | |||
Purchase of leasehold improvements and equipment | (3,072) | (3,501) | ||
Net cash used in investing activities | (31,718) | (42,988) | ||
Cash flows from financing activities | ||||
Proceeds from subsidiary note | 15,000 | |||
Payments on subsidiary note | (59) | (7,356) | ||
Payments on capital lease obligations, net | (322) | (540) | ||
Payments on capital lease obligations, net | 14,150 | |||
Debt issuance costs | (5,944) | (3,718) | ||
Proceeds from Debt Issuance Costs | (3,718) | |||
Net cash provided by (used in) financing activities | (6,325) | 17,536 | ||
Net increase (decrease) in cash and cash equivalents and restricted cash | (6,676) | 4,455 | ||
Cash and cash equivalents and restricted cash: | ||||
Beginning | 71,212 | 109,348 | ||
Ending | $ 64,536 | $ 113,803 | 64,536 | 113,803 |
Nonoperating Income (Expense) | (32,107) | (33,902) | (62,980) | (68,530) |
Eliminations | ||||
Cash and cash equivalents and restricted cash: | ||||
Nonoperating Income (Expense) | 593 | 593 | ||
Community Choice Financial | Reportable legal entities | ||||
Condensed Consolidating Statement of Cash Flows | ||||
Net cash provided by operating activities | 4,322 | (13,789) | ||
Cash flows from financing activities | ||||
Payments on capital lease obligations, net | 16,400 | |||
Debt issuance costs | (4,322) | (2,611) | ||
Net cash provided by (used in) financing activities | (4,322) | 13,789 | ||
Guarantor Subsidiaries | Reportable legal entities | ||||
Condensed Consolidating Statement of Cash Flows | ||||
Net cash provided by operating activities | (22,264) | 31,715 | ||
Cash flows from investing activities | ||||
Net receivables repaid (originated) | 17,114 | 1,623 | ||
Net acquired assets, net of cash | (117) | |||
Purchase of leasehold improvements and equipment | (3,072) | (3,501) | ||
Net cash used in investing activities | 14,042 | (1,995) | ||
Cash flows from financing activities | ||||
Payments on subsidiary note | (59) | (56) | ||
Payments on capital lease obligations, net | (322) | (540) | ||
Payments on capital lease obligations, net | (2,250) | |||
Debt issuance costs | (1) | |||
Net cash provided by (used in) financing activities | (381) | (2,847) | ||
Net increase (decrease) in cash and cash equivalents and restricted cash | (8,603) | 26,873 | ||
Cash and cash equivalents and restricted cash: | ||||
Beginning | 62,111 | 74,792 | ||
Ending | 53,508 | 101,665 | 53,508 | 101,665 |
Nonoperating Income (Expense) | (53,878) | (62,396) | ||
Non-Guarantor Subsidiaries | Reportable legal entities | ||||
Condensed Consolidating Statement of Cash Flows | ||||
Net cash provided by operating activities | 49,309 | 11,981 | ||
Cash flows from investing activities | ||||
Net receivables repaid (originated) | (45,760) | (40,993) | ||
Net cash used in investing activities | (45,760) | (40,993) | ||
Cash flows from financing activities | ||||
Proceeds from subsidiary note | 15,000 | |||
Payments on subsidiary note | (7,300) | |||
Debt issuance costs | (1,622) | (1,106) | ||
Net cash provided by (used in) financing activities | (1,622) | 6,594 | ||
Net increase (decrease) in cash and cash equivalents and restricted cash | 1,927 | (22,418) | ||
Cash and cash equivalents and restricted cash: | ||||
Beginning | 9,101 | 34,556 | ||
Ending | $ 11,028 | $ 12,138 | 11,028 | 12,138 |
Nonoperating Income (Expense) | $ (9,695) | $ (6,727) |