Open Lending (LPRO)

John Flynn Chairman and Chief Executive Officer
Ross Jessup President and Chief Operating Officer
Chuck Jehl Executive Vice President, Chief Financial Officer and Treasurer
Ashish Sabadra Deutsche Bank
Peter Heckmann Davidson
Randy Binner B. Riley
Joseph Vafi Canaccord
John Davis Raymond James
Bob Napoli William Blair
Vincent Caintic Stephens
David Scharf JMP Securities
John Hecht Jefferies
Mike Grondahl Northland Securities
Matthew O'Neill Goldman Sachs
Call transcript
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Good afternoon, and welcome to Open Lending's Fourth Quarter 2020 Earnings Conference Call.

As a reminder, today's conference call is being recorded.

On the call today are John Flynn, Chairman and CEO; and Ross Jessup, President and COO; and Chuck Jehl, CFO. Earlier today, the company posted its fourth quarter 2020 earnings release to its Investor Relations website. In the release, you will find reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures discussed on this call.

March like and you represent other view of I'd may this the begin, as estimates contain forward-looking today, we to that remind call company's Before XXXX. X, statements that events any disclaims these reflect to Open or Lending obligation circumstances. statements update to future information to by Please for differ those or earnings implied materially statements. the today's could that to and our from factors refer with cause such filings release SEC concerning actual results expressed your for remarks. call over to now And pass John, I'll the you, opening

John Flynn

you, fourth then update is conference Thanks today for like Thank in as quarter good provide Ross is the outlook for again we've QX highlights as review discuss progress going everyone. start our XXXX fourth well operator, afternoon, on finally, XXXX. quarter Chuck and and joining OEM us year for our objectives, by to an call. the opportunity. reviewing going And our to earnings detail and full XXXX financials our made on greater growth our to I'd our

for increase quarter, compared we as as million, Lending. an was XX% which year EBITDA XXXX. increase adjusted million, $XX.X of the increase which an certified of XXXX. compared was loans, reported XX,XXX of fourth XX% $XX.X which an fourth quarter and fourth revenue the was Open of was We a a productive to fourth to very the XX% quarter to The of quarter of great of During end

reported a increase a increase and XX% the a X% increase growth, loan EBITDA. adjusted in full XX% For year, in we certified in revenue

experienced despite to shortly. which with customers large new Ross is captive cert XX growth including added COVID-XX, partnerships also OEM several We billion-dollar institutions. strong XXXX, a going discuss We in

business customers. which direct initiative management the provide years union We our made years. bank after of on a we milestone focus well as went expanded many relief progress us and an on with that, positioned incredible course, board us our which for public, also strong and XXXX, team, And XX CECL to has the come. credit an to OEM, was And in lending and building for to our also for past channels and well refinance enhanced

to going XXXX. our a on fourth I'm quarter few Now minutes spend

be Our time. during lending in down further has for recent higher the partners credit This growth environment spectrum. continue of a in as led resilient addition to combination to of lenders of interest has to a originations low this to yields. deposits a very COVID A loan influx led result rate risk-adjusted auto search

XX During active currently generating platform customers the we certified are our we this quarter, added new and have customers year. XXX loans that approximately on

a large We to as as continue Goshen, billion California; billion in based Union, Indiana. in institution a in the Mechanicsburg, Livermore, some OE billion quarter $X.X announced Federal partnerships including Credit institution resellers well. credit based based We Interra institution Union, in First Credit $X.X Members bring $X.X Federal additional a new Pennsylvania and well, fourth union, in

partner bank platform to the currently this partnership X continue market to believe banks this FIS and to is originate to that well. going going as live the other up on Our use We're integration well with that us for open platform, platform. that doors into we is

the on additional great focus enhanced be channel. drive continues growth Our loan a refinance to to additional certified program volume

and side, partners bank's sources outside new funding unions the AmTrust. we existing on include to with our other and insurance with During the the credit credit partner signed banks that refinance and been and quarter, parties our we channel grew the X funding third lastly, program. working CNA We've also currently the on OEMs expand unions partners, partner with. sources then we our business to And insurance current

with have as X we more insurance X that insurance our partner discussions with with details. partners, active feel relationship enough in to we existing now as are jeopardizing We a we'll top on relationship without there's and support when update to third potentially carriers an various our carriers volume insurance provide

So so he Ross, opportunity have the with ahead it going to OEM and go over front we I'm of turn that, in into can to us. jump that currently

Ross Jessup

captive Thank you, despite John. fourth were quarter, the COVID-XX OEM tremendous certification strong originations demonstrates pandemic. the growth in which

collectively, OEM substantial laid is representing captive captive to revenue we As $XX opportunity, out $X before, million annual a million revenue billion opportunity opportunity. each and market with more annual than $XXX the

begun As OEM XXXX. OEM we in key captives, came which be ramp drivers first to will of online today, in submitted, the and of X ahead production and being which serve with this certified, OEM. #X, number up, we loans and booked of are Starting and ramp October. growth with applications currently expect continue opportunity to back have to back we the They encouraged with

XXX% experienced growth #X. December applications Moving over We April of over and of certification dealerships. nationwide onto their seeing OEM from XXX% are currently from to

score expanded launched We also credit for our offering officially them.

will their convention XX saw we our both to XXX at great of from scores addition usage increase months. expand regions, a in example X how product. are regions XXX XXX scores other launched next and opportunity encouraged In January X opportunities customer they is #X tremendous credit platform in of over and to to their to look OEM our also This to ahead. the by now the the XXX the and X are the OEMs very service our or few in expanded credit at all utilizing current has they benefit

In the white recently how we only a well we at independent created the findings many gotten their #X on our others. inquiries addition, help and auditors on and topic. have from from paper the We as paper the relief published CECL as can took the OEM SEC received

to OEMs and together we XXXX proposition in in with studies and build additional any have data Lastly, guidance. on offer continue Again, OEMs, value our been platform. active do pipeline we not our discussions have work our others on the and we very

would over to it turn focus that, discuss like Chuck opportunity. to the to We to Chuck? detail. in continue greater on this With financials I significant

Chuck Jehl

Thanks, Ross.

our before for full move outlook and year full to let's review financial Now solid XXXX. our year QX I results

XXXX report largely that the to expectations financial year. pleased are that are for results -- beat our We

For full focus XX%, total profit loans and certified revenue as the XX%. In to new XXXX, EBITDA Total institutions with year, XX%. XXXX, contracts Gross auto on lenders adjusted to in signed new X%. increased XX in increased signed contracts increased increased approximately XXXX. with XXXX, compared we larger XX a compared

December ended we new were quarter certified XX,XXX XX new loans with facilitated the During executed and contracts XX, lenders.

million pricing fees XXXX increase a $XX.X quarter to million fourth in margin go In fourth implementing estimate addition, same XXXX expenses in XX and $XX.X as as XX% dates due in and to merger. December $XX.X $XX.X XX% we be levels of XXXX. million live approximately at had XXXX XXXX purchased $XX.X million the primarily million with fourth and the our the our standards share of an our compared $XX.X with in was the of compared the fourth share. our XX, $XX.X to shares which wanted fourth in million post Net to claims December which share as million revenue Gross quarter underwritten fees ASC quarter of of approximately quarter measures quarter We at increase from increase in compared general and quarter the and found in million was the result previous days. better-than-expected any recognition assets, was update fourth out shares, quarter. of compared in we profit count, XX financial an of million, primarily merger for receive for of shares offering. was press fourth offering common were certified incremental in becoming to increased was million Operating XXXX and EBITDA to of earnings quarter we liabilities, shares was fourth a proceeds certified administration performance per was lays did to compared A million increase obligations posted of in to vintages any an net period XX% discussed cost one-time quarter $XX.X million the we XXXX. total continue the to and $XX.X quarter in decrease million with XXXX on $XXX.X offering. did income compared XXX of approximately than public receivable assets. an million active of briefly with Gross not we associated related change million the portfolio Total implementations $XX.X previous next to income by the and common cost for non-GAAP on public I million defaults is the becoming Adjusted quarter. was $XX the announced cost quarter fourth XXXX. selling due The XXXX, the in have Relations year underwriting We the a from the higher from claims. internal we XXX.X back presentation tax On profit $XX.X required the under supplemental includes a expected to XXXX. XX, agreement were of fourth income a $X.X continued $X.X X.X up procedures in companies. the improved $X.X driven sell the the compliance Upon performance $XX.X obligations in X.X had compared the with associated We debt release. our portfolio quarter updated XXXX to fourth XXXX. total is conditions and administrative fourth million. unrestricted We million company. price XX.X% compared quarter XX% in our exited of loans $XXX.X million stock Program to transaction upsized of and as closing cost Selling, year million With contract which in $XXX.X cash quarter in The above. the better in associated give due fourth the the GAAP site, XXXX in that $XX.X company, and to XXXX, were quarter macroeconomic to a $XXX million of $XX.X quarter making XXXX. share The of Investor XXXX. SG&A offering fourth share the a not stock corresponding that in profit million result count. million XXXX, loans of was satisfied as can X, of our Also, Lending to million as current of periods slide an and incremental at the outstanding control to and public the December of you and enhanced related performing million, XXXX as were offering of fourth our reconciliation previous overall of for public lower-than-expected investor including result from Open for $X.X historical stockholders

million. $XXX,XXX. results be $XXX guidance million quarter between are guidance $XXX EBITDA be $XXX March, cash $XXX,XXX and Total follows: revenue to operating our million our between to flow and $XXX and fourth XXXX. for be loans as and certified million. be to and on million to between between trends million ranges adjusted $XXX moving $XX and to into Adjusted announced Now Based previously we total reaffirming

from back Now the and questions it turn over operator, the with to you. some that, to happy group. Thank we'll take


is question first our Sabadra Deutsche And Instructions] Ashish Bank. from with [Operator

Ashish Sabadra

OEM I was if results. update on can #X. you Good provide any wondering

data talked on #X? that the for about had signing up study You that conducted OEM had progress you the Any OEM.

Ross Jessup

Yes. this Ashish, bet, is You Ross.

of them had that in declined So Well, when sent that those basically back us. they a that whether they it provided in a the late About we kind presented us, finished actually provide actually time, because study lift they to them results at of approval. as not were Last approved presented ago, requested of given were the It weeks applications and approvals. of was did in the statuses or a fantastic, we had did we they XX% to study, us XXXX. them. one-sided that we data X side of that. XX% study week, point

So meaning there that. are no counters in

basically that. meantime, actually sample In of with back that pleased a They them. for meeting the policy, from insurance review results that from in us very presented can and getting the this week that CECL side, their the -- we're to agreement they relief a from we interest benefit. are on they've that. program around arms accounting So asked internally so their their And

Ashish Sabadra

relief. CECL follow-up my the on just would be maybe And question

just opportunity you banks? about was front? talk You paper conversation how opportunity the relief do talked think published. regional the any CECL you on the about with about that white Can bank the there, And

Ross Jessup

has I resonated really, bet. it we've quite a about. mean, few you talked Yes, with institutions

hopefully, specifically and to We have asked that And another actually and into to we for basically, insurance captive agreement some call. a policy the questions helping our of They OEM week. back also happening. definitely last were copy also brought to questions. are we're sample that We've they ask wanted advisers We our with will as -- program the And those provided that doing discussions foresee actually we talking that -- them. to that and webinar. document to. And which other OEM well as the a ones we provided of course #X continue,

talk, to want that? You John, about

John Flynn

highest for the the different most the number document to that CECL looking could asked, number well. from now too, it's bank I what together. the or out We've think have necessary same banks. asking bank is we think since impact these study that that provided prospects we larger had. these to just banks have side, most of we've of probably do that that of we've of the data it that them. what for do X a resonated on that And -- a Ross got had for active got And started We to or what them company. reached Yes. had We've of X few have put data impact I standpoint a alluded we've you

we're And in do's So the I of going of process and that point, Ross' very host been CECL. positively together where received. we're the putting think to webinar a to it's don'ts

that to are for do information going we to how on prepare advisers fits XX-minute this to feel they CECL. then we're Our about in presentation to need some a going product be what And about fill doing need. backdrop

So well be received. it I very should think


Davidson. Our next with question is from Peter Heckmann

Peter Heckmann

And us be able a about this of OEMs in ramp fully in talk X your a to end bit any year of change relative the probably, those the of then little you may Could percentage [X] where ramped? when of maybe quarter? give the by OEMs percentage third expectations relative to mid they're maybe to,

Chuck Jehl

the have filing we on In chuck. we in OEMs there. supplemental it's Yes, total website, our that have the actually

So the don't actual OEM we X break X. actually and out

OEM our and XX,XXX quarter, fourth that X. certs had X,XXX a in were So related we to little under of X

in. the they'll into about growing think back by April and done ramping, had on year that And XXXX a So the and like and X,XXX X,XXX Ross as the per encouraged how ramp. level we back late later by we've it, about they're we towards part XXXX of call to full for X,XXX to XX,XXX We're and OEM think that, And in year. October end feel from is, to OEM at the to soon be is but be OEM the in OEM the X month ramp talked about, jump can ramp talked to year we even. to came X certs the -- of that X as XXX% growth has through to, into through in December X,XXX And grow we the continues 'XX. --

Peter Heckmann

it. Got Got it.

you've the just reviewed be approximately does extent Okay. quarterly terms right comparisons in range? of And calling last that Anything any with that the give color it earnings the cadence issue? to guess like regards some with that you'd that's out to appear I of to as half? then the Or in just first to additional consensus year. unusual in worth

Chuck Jehl

by And is March I'll good that February, then 'XX If and good for the guidance in hard reaffirmed we into the why I'll was the it just tell will United year that which about a Texas where feel was States, is you week there. and February us in seasonality It reaffirmed hit bit today, ranges. a the heading into period. as like in we everybody us. year. But our full in really is month got about very encouraged we're the for weather impact January that you great company, tell December difficult, Obviously, a on we're really and we

growth, So it's range, XXX% you about high low mean, end it's the the of growth growth. end on think on our I year-over-year of the the XX% range,

we're good coming the is this and record So high coming about really apps In feel year. in apps, where we and for company flow had a heading the app strong for month in. at in

So we encouraged. feel


with is Riley. next B. Randy Our Binner question from

Randy Binner

bit. expense a I wanted the to little on line just focus

You there was mentioned million. that item bit public $X.X other expense in like and higher that there but of are a script of company kind some your was an little expenses, G&A

each I public and was why just just company to then the was where clarify elevated So G&A map revenue wanted into fit expense that? higher elevated, if to the

Chuck Jehl

Randy, it's Chuck. Yes.

XX company over become we've in hired June. you we've to about XXXX going navigated If as in QX 'XX, and really, think 'XX public people a public

really XX and So of and public Sarbanes-Oxley particular compliance then it's hiring public in and taking and that insurance-related getting folks, for comp and accounting thing kind benefits ready and with domain company legal the D&O. cost associated the increase of some

really in merger the file was part non-cash what what In was later the the you're of is, line. we'll other I referring million week, a then to tax it's in measurement to basically referring XX-K that to, agreement line, cost. related charge of that receivable In and that's prepared the about a transaction. SG&A in our our to the change that So the increased $X.X the expense remarks

apportionment a out that drove So And that EBITDA. the up. that rate in in quarter state we fourth adjusted of change we the taxes had for state

associated kind just -- rate of the that reconciliation back once look merger-related you that's a you the that costs transaction change, If on with table, change. at

Randy Binner

time. one up? caught Okay. That's And that's

Chuck Jehl

right. That's


Canaccord. from next question is Joseph Vafi Our with

Joseph Vafi

all see progress. the It's great continued to

say fully on it to kind OEM ranges then X think than kind I the in OEMs. those have their you say business? of discussions #X, do back talking And extra #X is And fair then a increased other Is at organic now? about circling FICO score that's worth that OEM ramps, point, ramped growth of OEM #X there those quick that any regions their that own you'd after follow-up. right across Just

John Flynn

to we're the information. an it. we that Yes, they're think of document need consider of render rollout and would in still basically, OEM markets. here. them to provided through subvention are a the us #X, good having discussion do we back opportunity Joe, to those them way that We And Yes, not catch capped for a to show with have adopting discussions. the after use different API them from to I we them X lot data so There's approvals. sub-vented can some Actually what points we our up

And one back. digesting we yesterday. to study. pleased that we're asked and now, the talked going about have to them here We've -- discussions so is then that #X, soon. We information them they're that And they've announce us. receive They're a from are want while. They a for to engaged. OEM there we've data that actually And those they're

so to risk can we be our through what of And numbers team is them. lift the going kind to countering see give

current we it's this wheelhouse And news. is sense fits believe kind product the from an what standpoint. our opportunity of of so makes really that very And

Joseph Vafi

Great. really exciting. That's

Chuck, how up certs clearly. of cert first your forward this think versa. company of Because on performance-related revenue and if a was I tracks less just revenue hearing of and secondly, walk it on kind us like more and year, up and are And -- normalizes you if could to different mean, know how And Looking kind just very as to we in some more a revenues an year, also vice I maybe, normalize things economic other through, any that. and then basis looks quarters, growth? -- things, should kind public

growth? So normalized of kind growth as we a of business, think a versus to should we if cert how revenue get world,

Chuck Jehl

I'll bet. Joe. start, Yes, You

new really I'd when the truly like is and for based business we break where is, originations QX. you tell back performance one what's got on what good thing estimate XX-K, profit better-than-expected a particular the our change share versus we on in we in So file in the had out disclosure we

historical MD&A So revenue. out as cert go, I'd adjustments the tell just grow with in that kind that you'll to you, And it's vintages. will need the disclosure on of you related focus backs kind pretty of linear to

pretty you together, about think could grow growth. I think they that, So linear


James. Our from question Davis is John Raymond with next

John Davis

they would First, just they you any touch would Or and OEM to to kind be where just given of ramp? the wanted there color the I guess, ramp, relative kind by helpful. on Are #X now of be expectations? October your thought

Ross Jessup

They over of the they think that's experienced. subvention And was it and in I their think thought in back rollout. that more we place next X far targeted storm say track dealerships. during as on getting in them Yes. used Texas. would is operates be the is or we to the was with the that it X dealerships the outside is John, months got rollout I the the it that inside would we to rollout on active. But market here relaunch as putting the ramping targeted the the for that definitely market even of The took one be. They've schedule just second like a will live -- where division control

ramp that would and very and they but bit -- as And that along got just is I'm pleased where be little still progress everything And to like soon going seems I further to is, that The a it's they very we out ongoing. it's delayed negative getting would it a a good rolling from But about the so are wanted news going it dealer continues. be like little -- but not feedback. is, from, as bit. it it any it this than involved it's hope

John Davis

stimulus across I all at now. we share, if phenomenal better classes was the on what more color. than pretty profit That that great credit good the a And bit is That's asset XQ was right it way. look expecting. Okay. guessing were then I'm

drive pieces maybe I else should credit, upside? it's equal, that from offset 'XX 'XX? all look moving there guide, of look So share better profit Are better at reiterated, we into any obviously, out that kind potential as as

Chuck Jehl

mean, listen, COVID I rates. hit, when us lower of mean, expected to of I unemployment Yes. change The the million pandemic seen lower when $X.X none this. had part -- obviously, claims, earlier stimulus none QX, go the down in it mean, we when so -- back of us I that default XXXX quickly like spiked. has a we

we book, are So really change why performed better it excited our we than really had we that estimate. all expected, which the is in

would KPIs, XXX the So ASC our we've to in in vintages. normalized estimate change the I historical KPIs to -- exclude due on

if So doesn't year, But you're we I $XXX if share. $XXX per -- million. to think profit full and -- it the was averages about that's it kind on December averaged to average the really And for on X of months ended $XXX spike going use, is $XXX you about cert good share. the the profit 'XX, a into think XX,

So would way. about think I it that


Blair. with Napoli Our next Bob question is from William

Bob Napoli

I up guess and a CU year-over-year, bit the certs, obviously, in little the growth up were flattish, tremendously. while OEM bank certs

of Just the growth and the the on potential. bank and your in certs rate credit XXXX long-term thought union

John Flynn


purposely, underwriting to by you the look of book I conversations, changes. will, making if some of mutated you some kind think remember we the if ratio

paper we like feel discounting clean about again, XX%. the we've to -- -- talk which now. were we cut profits what you better doing talked about And on like feel a looked we is did trade and flat. to back And from XXX% down of made that little that booking here, at what point if the by we advance bit, search we right However,

that to and in would stayed about frame done search And ratio been advance book-to-look in it that right that the looking back study have taking a shows change, to same I that changing what think we that XX,XXX currently at are had gone XX%. from instead now, XXX% of the prior credit to up time we've done more at was unions. there that

purposely So it was done.

unions bigger now after. see some right are signing go you'll think credit hoped we that the of had we I to

right I think to are Chuck number now. implementation of shops alluded the that in

Chuck Jehl

XX, right?

John Flynn

bunch a near that Yes. they're of through the launched We had the at now. year, up get end launching so XXXX didn't of the of signing end them

Chuck Jehl

Yes, Bob. I'll jump in there,

And the and we and going live had of those, customers XX had of XX live signed we we then that those in up in XX January so XXXX went in XX February. that QX, are

the delay, live challenges. COVID-XX the of growth and now going implementation and back in a going and help for and by difficulty there we're banks. that 'XX those the But credit the our encouraged really will So union coming on into lot ramping,

John Flynn

I to partner. refi really we've what thing -- add that, see think and you'll the one I'd channel enhanced

Chuck Jehl


John Flynn

their only And again, I'll channel those. just with last you've has And use are months. list talk X launching the volume doubled of -- launch. launching a Their of heard on the few to me about that's X Pentagon in X refi partners that

think uptick in year. which going to big lot the starting same-store we're be I this of is sales, a to see So lift a

Bob Napoli

Good. Great.

my question used third. was so next on I You be a refi, going guess I get to

some how I competition? do you of mean returns you where -- -- you most public what in step you very have -- Do attractive think attractive Where competitors generating back can And you your and potential model, your competition, do how cash an are about competition? do have a you any do Where your about competition? do that? stay have generating you model think you now concerns that you company pretty Just customers slick see. front do flows and now, concerned? how you're

John Flynn

these comments, the the that, add to years -- guys XX-year-old the models, of any relationships. again, I'll build the like made has we and in build Ross feel this to XX a But company, we're Flynn. interfaces, John certainly and and these comment. is always this it's let to to opening I to taken build alluded

channels. try to going we get out than to XXX or see If come have agnostic jump worth other years' We've somebody through created a bank unions a credit are through somebody not you're more to bank run something you their had that's the got XX on data. the applications to like big with like to in, of bandwagon business we've wanted

We continue exclusive our exist. to -- not carriers the that with relationships data. We've fine-tune

a be going another in really carrier to have that is Somebody up interested to we've years spent gather would writing what XX to lot this. gathering like of attract something

a So Having if again, the that, said of it's billion market. loans of year. And around moat We've all a pretty last to underwritten of this strong to compete. $XXX built space room try I think a $X in there's billion we've were somebody worth company. lot

Ross Jessup

like penetrating space growing. white on of lot A mean, and the John all TAM. about we're is I Yes. said, X%

the an not enhancement, our risk breed I yes, -- that to trying without underwriting today looks our all sitting ourselves can the is we what make underwriting when scorecards, data around additional in And thing alternative and team from do we're bringing on back like is looking sure at that. think over patting main of what So best top we're of latest. the of the on


Our next question with Stephens. from Vincent is Caintic

Vincent Caintic

first, refis you of of -- questions, how going -- XXXX on a about -- just and just how much much non-OEM X actually, say follow-up. opportunity, the actually refis then quick was could think so forward? how First, from a give But when you

Chuck Jehl


that in OEMs it, growth. diluted year of full -- year. that that by for keep probably, is the be to is the I will One XX% think XXXX search think XX% -- about Vincent, OEM percent call for XXXX, you refi thing the there'll if be as mind, ramp, to

Ross Jessup

order. though Even the actual

John Flynn

kind relationships on direct. go until refi business of hit. of our that we and indirect partners And refi, we a the were force the to really COVID in selling creating were lot pivoted process with. our sales didn't of and really a focus all out was Yes, we the -- And channel start we

think any standpoint or of to volume. that refi from you a really June before side don't lift I July So the any see started from of getting real

So X trying in the a looking you're tie out of really at of months there. year standpoint from a to percentage

Chuck Jehl

the XXXX we've a slide that refi think talks I That's investor the on February, our XX%. presentation, point. program. a February Yes. great got In to XXXX And not up about refi supplement, application over

Vincent Caintic

Okay. That's great.

thing. quick Second, clarifying a just

the -- the change So or estimates. in

quarter, share $X.X took you it the $X this to And million. I it quarter, up had So first million. last up estimate. think In million taking you're $XX you quarter, then decrease profit

before to should about back same. So you're Is understanding -- about you're share expectations that I am and -- that kind the were forward going where profit you of right? expecting be

Chuck Jehl

I right. tell mean, understanding $XX mean you million negative. I was I yes, Vincent, that it think you're about Yes. I'll it

Second a well. quarter slight as downward adjustment had

And so change the we were for period said, the see from full year, of recovered and period. when most year. historical our like vintages about table a adjusted for the pre-COVID I that the X.X% the in downward XX-K, file or We estimate COVID you'll

a the It's on got executive level, we're we've process the robust we all at XXX. So -- think involved.

enhancing. does team a we're process great a that I every go risk job. Our and great model quarter, mean, got we've a we it's through

And as we're estimates. pleased how performance default so But performed posted. in you less with we'll very changes But keep the the book we'll changes, that and make the claims. and


David And question Scharf from with is JMP Securities. next our

David Scharf

just a from a painted be and the over wide competitive go-live the fairly we sort first on end? you've guidance, bank a the of high the CASM to Is of range it sort sort to are one observation. to end the versus uncertainty sense, mean, to maintaining that picture the forth. get of what get guidance I and end of into the trying next XX% XX on still end It's bottom question and a lead a would so lot of end. COVID-related more major of and top the factors, low some visibility good all the low Just macro high OEMs between XX% the related approaching trying the issues? about partners to to roadmap general more Maybe Is of is metrics, days of of and so into And this fairly new high industry a function factors ought between low navigate the end, gap still this of how a sense other to thinking unknowns? for progress primarily

Chuck Jehl

in early this were into mean, Chuck. We It's -- are it's QX early. year. March the from encouraged now. encouraged Dave, is Yes. I one,

we the rollout all wave You're and had COVID. the of there with that. vaccination unknowns right, there's And out and second

phenomenal on is So where point are, I'll you was But XX% feel maybe we growth about guidance. that XXX low tell of albeit really we it's reaffirmed any that the -- those prudent felt and growth wide. versus end like good ranges on it in

midpoint the I is think XX%.

when reporting great QX in around talk year back we're we'll time going thoughts March more is the -- historically, May And again. watch now And to full 'XX for and we'll period March. And a perspective. short. come between us. it's is So obviously, we 'XX full pretty give a to month for year seasonality from

David Scharf

range. no, Got with few it. of are And there be few would companies disappointed low that end growth the your a very clearly, no,

the Just different at for play. a context variables

quick a follow-up. Just

that to I they On were side, board with? of in you're carrier looking of carrier It mentioned my the the call that getting may of year. widening be at on the notes, close this third that the who April, net quarter the you sounded perhaps was short on that third a had kind terms kind Is actually you May strokes case? talking still believe like

John Flynn

is a broker the we were to just as nail able our slowed we We sure And volumes from on. the down wanted we result have of our the make calls carriers, a some bring Flynn. and result did feed existing that -- use to with be you And that This inbound that to different different going John the that quite on of to just carriers versus or and hit of there independent paper, interested our to as are What with that, upwards doing. of the We're at extremely that few under areas right which can We're where carriers write introductions of NDAs other we're can like the actuarial X can trying somebody help geographic or a just the make whether us them. firm, identified they they picking what that. X in see is grow? growth we've we're fit, looking opportunities head. us

that year, different seeing based in the like believe we do we coming the anticipating interest that one we're we're conceivably and on in that mention seeing in OEMs on of the X did just from might we're on bring previous And have process them. of the down. this board we'll We calls. banks, narrowing So and the volumes

right interest our I’s and we more we're that's It's make partner. been insurance that our dotting bring on from sure for crossing of carriers. us sure the of a lack T’s So not making to


Our Jefferies. with is next from question John Hecht

John Hecht

little when a obviously the forth, earlier and you might That at Circling last profit just uncertain to but underwriting recaptured -- of I bit you've also back But some I understand get for year you because were thought think cycle time, the things logical seen share increased credit we account of the revised middle the fees year. you to revenue haven't risk. credit was your that that so we yet. really

we I number So risk, until you wouldn't relative is, charge-off less question maybe guess that underwriting elevated are risk number least before the see to profit occur? to And share do margins the in or they remain to two, were increased cycle we where one? the expect at

Ross Jessup

out decrease lot Hertz John, of time, there still and in of this you're and all that valuations the vehicle place. right. vehicles. Whenever went move we and to a Yes. that the in back and Obviously, Ross. with point left exactly X% value is sense we've ahead, situation a we made And in risk saw Yes, April, the that there. was we that drop took a at

in credit We Index. get interest into our being, are to the top all where and The can from first tracks them, and purpose close lenders and asking interest a will what lower, our higher. what's of banks their compared what decreased quarter in rates rates did We it moving interest that across the looking was were pre-COVID. level our during with and unions to that cause rates actually a to almost all their looking That the our actually increasing. of look last ours that Manheim quarter be by where be credit at at ratios to the to happening carriers score study XX values consider did time definitely back the were we they

a believe And a that. realign kind from it of so competitive be will we great standpoint to just move

If means there of we future increase values that accordingly. X%. what have all will be by think of normalize, could of assumptions a from booked is removal the profit is that all future change in the Now -- it we share help will affected actually that

Chuck Jehl

But some as still the the vaccine and we out our of share on 'XX, look profit stress with with COVID. -- unknowns levels have into we

are still that's think answer, levels of just stress the So part the out too, there I those is with that unknown.

Ross Jessup

could that of some And free it up, would...

Chuck Jehl

Absolutely. up. free absolutely Could

John Hecht

And who -- is on the that what's might how context working that. got is, color. on mentioned Maybe sounds you've like sounds or second, And the to recently, have -- banks platform the what's helpful coming appreciate lot ramp and it the And but the I a we bank you the of how pipeline. like? can banks characteristics question, the that like brought that's the and the just No, about and bank not that that going? And then you characterize see what's active you're cycle cadence process nonrelated look of platform? what sales other talk expect is bank an pipeline, with? maybe you it Great. sales -- you Okay. in

Ross Jessup

month of of out that in talk about the December, loans over great came banks X talk one a level. some of one company basically and a with first John them the finance that's just it to And banks. and is side in that proves went months. And that XXX went finance XXX will You in tracking is had live basically live it. our And may -- out other in the of about the gates

John Flynn

I and I bank of upwards of we into built dealerships They've one just reference that a was And that the out to, they launched now platform, back a had dealerships. interface us in out started. to on mentioned to a a a few with just platform. car think, Memphis, particular hundred FIS when bank few taken live get It's

ramp known But that bank about off. that hurdles the interface we of currently the was is is was, face in my as making particular the growing anticipating we're one built to any this comment take So sure there always case, And platform. is working on. originate that the FIS, from what's

knocked are actually the to off bank platform. bugs running up on us all and other that, that While identical interface, XX, and the that market FIS help are is XX one banks will that now

that removing What force. big those will FIS always by and is out doors to going And we us that talk the back interface. doing hiring portion of open now heard the about So instead do a the hurdles, of sales shares you've rev building other and they then sales banks us utilize on to payment are and for force some generate program fee help platform. our

built, to interface So for that us the it it's a and model then they lot are years. we great Every us the saves knocking. on users over help door of been and a platform, just that us out sell go

to So doors. a for open been great us way it's


Our Northland is Securities. from next with Mike Grondahl question

Mike Grondahl

OEM sort with you're and practical With the delivering X potentially takes be this What year? OEM that is working could exchanging they of some certs later time. but clearly, #X, odds or it everything them, data

Chuck Jehl

Yes. this Chuck. Mike, is

and 'XX -- As X these And we're they're sales guidance and I'm we learning OEMs long the large Ross, I business mean, with And John and our XXX% Ross are doing these tents banks really and can. X. just is cycle, and it odds and talk not give to that we'd try happens it really on to team, and rather come just back about -- really not what and and in on when you the past happen. might you focused everything

focused we're every but day we that. -- -- on listen, to and So it do but working

Mike Grondahl

a XXXX. price that you adjusting May for increase Got keeping follow-up, thoughts Any in guys, implemented as environment? a price it. think, of or it. And on Got the then I increase

Ross Jessup

the the price caused a actually did a -- X%, the that that And indirect what premium. decrease of vehicles that made Yes. by in Mike, whenever -- value was so we XX% increase is increase actually because event

didn't into we vehicles it the reducing by put of So through higher loan-to-value. collateral that but all the by increase a came value XX%, premium we technically,

a premium. tracked to so And higher it

if that as it doesn't discount we X% we're future that vehicle back -- to the And like So need and April. -- with in to that values. were the that and it values is in we seeing appear have issues relates basically certainly, just so what evaluating there's thought considering vehicle

John Flynn

like was was an book made last That change shouldn't comment represented the the XX,XXX have additional stayed about ratio have would before to I it Mike. look that made seats year. we

Mike Grondahl

it make you'll that? when know roughly month-to-month Or by of decision on look is just it? at a sort you do And

Ross Jessup

some at carriers, with we've look had preparing that. here the to our We've and been initial discussions Yes. data

release. that get we with feel adjustment off it through our XX technology signed when comfortable and so can have side, we on an effective XX, days and a make And -- after


[Operator Goldman Instructions] Matt next with from is O'Neill Our question Sachs.

Matthew O'Neill

Just update the around here. transparency sort thanks had a business the the follow-ups couple and and of all for of nuanced

around So rank I in to you look much I kind wondering guess, we far. first, could kind guys you just about the types the where whether order, kind of trend the if prices. going it's that of how ago? car of a the things about sort constituents those were they the may measurement we've or remeasurement. could there's the understanding of that factors way gotten it a are what forward, back X way that pillars kind we used talked think credit help to year just the decisioning lot the like And a performance, as of of so biggest us through think far at, so I of as But and know X, we've X was

Ross Jessup

claims Are be. filed thought defaults. I to think would levels in we place I Have lot we is first think, it, thought of we defaults of regards be. would Matt, being than where a taken to they that all, compared higher seeing they

happen. first, we're And road at, kicking Well, it. develops and then will that looking are seeing just we're we not so can down the tracking the the by

certainly So get And have possibly bureaus delinquency what in. do XX-day anticipated we at when than we're XX, seeing now claims data very doing XX, much to that close we trends. modeled. the we're it's from would come And looking is lower what and maps we

because lower vehicle prior demand. our with second a severity. cars actually severity out it level new was a are that's standpoint, deals at and higher of which there of the a dollar of a we much of cause The much inventory And from is value, and whatever claims of we're part seeing claims severity claims -- limited number

I so components largest So think the that. of X those are

Chuck Jehl

mean, things perspective, macro the that. that. used focused car from index think sales, rates like the car you Manheim strengthen unemployment just and on values, and And we're I about Obviously,

Matthew O'Neill

Yes, helpful. that's really

partners. as with potential it amount X to your sort increased have and economic -- having be sounds stakes As primary the or is assume they additional kind table kind a of because which right, the insurance economic as far you that pair Is would of you from theoretically effectively guys inbound fourth are ensure X providers economically you of agnostic existing first that would beyond otherwise, of that of to you discussions in the maybe with as a guys if share same as subsequent not and with today follow-up, kind an third insurers weren't arrangement be Is loan, like what safe logical? partners. as contractually subsequent in like

John Flynn

Yes. would That identical. be


call now have And John to the remarks. we over for reached end of question-and-answer session. the closing And I'll Flynn turn the

John Flynn

the and we've and we in about kind where -- really you love these guys, address with Yes, open we addressing the very been. of appreciate We're company taking to listen wide going time we're where questions.

Thanks. following investors next So us appreciate year. us, the to and looking into you growing our forward appreciate

Ross Jessup

your time. for everyone, Thanks,


participation. concludes for this you conference, your And may today's disconnect you lines this your at and time. Thank