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Section 1: 8-K (FORM 8-K)

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________

Form 8-K
_____________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event Reported): November 17, 2016  

America's Car-Mart Inc.
(Exact Name of Registrant as Specified in Charter)

Texas0-1493963-0851141
(State or Other Jurisdiction of Incorporation)(Commission File Number)(I.R.S. Employer Identification Number)

 

802 Southeast Plaza Avenue, Suite 200, Bentonville, Arkansas 72712
(Address of Principal Executive Offices) (Zip Code)

(479) 464-9944
(Registrant's telephone number, including area code)

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 [ ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 [ ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 [ ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 [ ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

Item 2.02. Results of Operations and Financial Condition.

On November 17, 2016, America’s Car-Mart, Inc. issued a press release announcing its operating results for the second fiscal quarter ended October 31, 2016. The press release contains certain financial, operating and other information for the period ended October 31, 2016. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

In accordance with General Instruction B.2., the information contained in this Form 8-K shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1934, as amended. America’s Car-Mart, Inc. undertakes no obligation to update or revise this information.

Item 9.01. Financial Statements and Exhibits.

(d)  Exhibits.

Exhibit 99.1  Press release announcing operating results for the second fiscal quarter ended October 31, 2016.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 America's Car-Mart Inc.
   
  
Date: November 18, 2016By: /s/ Jeffrey A. Williams        
  Jeffrey A. Williams
  President, Chief Financial Officer and Secretary
(Principal Financial Officer)
  


Exhibit Index

Exhibit 99.1  Press release announcing operating results for the second fiscal quarter ended October 31, 2016.

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Section 2: EX-99.1 (PRESS RELEASE)

EdgarFiling

EXHIBIT 99.1

America's Car-Mart Reports Diluted Earnings per Share of $.62 on Revenue Increase of 12.9% to $150 Million

BENTONVILLE, Ark., Nov. 17, 2016 (GLOBE NEWSWIRE) -- America’s Car-Mart, Inc. (NASDAQ:CRMT) today announced its operating results for the second quarter of fiscal 2017.

Highlights of second quarter operating results:

Highlights of six month operating results:

“We are pleased with our top line growth and our sales volume productivity improvement. There is significant demand for what we provide our markets and we are excited that we have expanded our customer base by 2,600 since the beginning of our fiscal year. We are now serving almost 67,600 customers looking for good, basic and affordable transportation. Our Mission is ‘We strive to earn the repeat business of our customers by providing quality vehicles, affordable payment terms and excellent service.’ We work hard every day to live our Mission Statement.  We believe that the communities we serve always deserve our best, and we are prepared to deliver,” said William H. (“Hank”) Henderson, Chief Executive Office of America’s Car-Mart, Inc. (the “Company”). “The competitive environment remains challenging, but we continue to believe that our face-to-face relationships with our customers combined with our efficient operating model will allow us to perform at a very high level as we move forward. We believe that our future is bright, and as always, we will continue to push for excellence in all that we do.”

“Once again, we believe that we have significant opportunities for improvement within our existing network, especially as related to customer success rates, and we remain committed to prioritizing efforts to improve results at all of our individual dealerships,” added Mr. Henderson. “We also believe that we can begin adding new dealerships again at some point in the future as we see improvements in results from our efforts.”

“As Hank mentioned, we are very pleased to see the top line increase of 12.9% which was driven by a 12.3% improvement in sales volume productivity for the quarter. We sold 28.4 retail units per store per month, which resulted in leveraging our cost structure, driving selling, general and administrative expenses to 17% from 18.9% for the prior year quarter. Improvements with inventory management resulted in a 220 basis point improvement in our gross profit percentage. Obviously, our associates are working hard to improve results and these dramatic positive changes did not happen by accident. We are very appreciative of their efforts as they tirelessly push to help our customers succeed,” said Jeff Williams, President of America’s Car-Mart, Inc. “Net Charge-Offs, while down slightly for the quarter, were higher than we would like to see and we attribute some portion of our credit results to the continuing tough operating environment. We know we can do better and we will continue to prioritize our efforts in this area of the business.”         

“During the quarter, we re-purchased 24,601 shares of our common stock for approximately $894,000 at an average price of $36.33 per share. Since February 2010, we have re-purchased 4.5 million shares (38% of the outstanding shares) for $142.9 million at an average cost of $32.11. We plan to continue to invest in stock re-purchases opportunistically as we move forward,” added Mr. Williams. “We will continue to focus on cash flows and maintaining a healthy balance sheet.  We ended the quarter with debt to equity of 53.1% and debt to finance receivables of 26.3%. During the quarter, we increased financed receivables by $13.7 million, re-purchased $894,000 of common stock and had $352,000 in net capital expenditures, all with a $7.2 million increase in total debt.”            

Conference Call

Management will be holding a conference call on Friday, November 18, 2016 at 11:00 a.m. Eastern Time to discuss second quarter results.  A live audio of the conference call will be accessible to the public by calling (877) 776-4031.  International callers dial (631) 291-4132.  Callers should dial in approximately 10 minutes before the call begins.  A conference call replay will be available two hours following the call for thirty days and can be accessed by calling (855) 859-2056 (domestic) or (404) 537-3406 (international), conference call ID #12840259.

About America's Car-Mart

America’s Car-Mart, Inc. (the “Company”) operates 143 automotive dealerships in eleven states and is one of the largest publicly held automotive retailers in the United States focused exclusively on the “Integrated Auto Sales and Finance” segment of the used car market.  The Company emphasizes superior customer service and the building of strong personal relationships with its customers. The Company operates its dealerships primarily in small cities throughout the South-Central United States selling quality used vehicles and providing financing for substantially all of its customers.  For more information, including investor presentations, on America’s Car-Mart, please visit our website at www.car-mart.com.

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements address the Company’s future objectives, plans and goals, as well as the Company’s intent, beliefs and current expectations regarding future operating performance and can generally be identified by words such as “may,” “will,” “should,” “could, “believe,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” and other similar words or phrases.  Specific events addressed by these forward-looking statements include, but are not limited to:

These forward-looking statements are based on the Company’s current estimates and assumptions and involve various risks and uncertainties.  As a result, you are cautioned that these forward-looking statements are not guarantees of future performance, and that actual results could differ materially from those projected in these forward-looking statements.  Factors that may cause actual results to differ materially from the Company’s projections include, but are not limited to:

Additionally, risks and uncertainties that may affect future results include those described from time to time in the Company’s SEC filings. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.  You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.  


America's Car-Mart, Inc.
Consolidated Results of Operations
(Operating Statement Dollars in Thousands)
 
          % Change  As a % of Sales  
       Three Months Ended  2016 Three Months Ended 
       October 31,  vs. October 31, 
       2016   2015  2015 2016 2015 
Operating Data:              
   Retail units sold    12,167     10,881     11.8 %       
 Average number of stores in operation    143     144     (0.3)        
 Average retail units sold per store per month    28.4     25.3     12.3         
 Average retail sales price $  10,491  $  10,247     2.4         
 Same store revenue growth  11.6%  (3.4)%          
 Net charge-offs as a percent of average finance receivables  7.7%  7.8%          
 Collections as a percent of average finance receivables  12.6%  13.7%          
 Average percentage of finance receivables-current (excl. 1-2 day)   80.3%  82.5%          
 Average down-payment percentage  5.6%  6.4%          
                   
Period End Data:              
 Stores open    143     145     (1.4)%       
 Accounts over 30 days past due  4.8%  3.5%          
 Finance receivables, gross $  474,295  $  427,663     10.9 %       
                   
Operating Statement:              
 Revenues:              
  Sales  $  133,170  $  117,670     13.2 %    100.0 %    100.0 % 
  Interest income    17,040     15,334     11.1      12.8      13.0   
    Total    150,210     133,004     12.9      112.8      113.0   
                   
 Costs and expenses:              
  Cost of sales    77,997     71,596     8.9      58.6      60.8   
  Selling, general and administrative    22,654     22,239     1.9      17.0      18.9   
  Provision for credit losses    39,441     38,094     3.5      29.6      32.4   
  Interest expense    1,036     792     30.8      0.8      0.7   
  Depreciation and amortization    1,080     1,038     4.0      0.8      0.9   
  (Gain) loss on disposal of property and equipment    (1)    19     100.0      (0.0)     0.0   
    Total    142,207     133,778     6.3      106.8      113.7   
                   
    Income (loss) before taxes    8,003     (774)       6.0      (0.7)  
                   
 Provision (benefit) for income taxes    2,985     (289)       2.2      (0.2)  
                   
    Net income (loss) $  5,018  $  (485)       3.8      (0.4)  
                   
 Dividends on subsidiary preferred stock  $  (10) $  (10)          
                   
    Net income (loss) attributable to common shareholders$  5,008  $  (495)          
                   
Earnings (loss) per share:              
 Basic  $  0.64  $  (0.06)          
 Diluted  $  0.62  $  (0.06)          
                   
                   
Weighted average number of shares used in calculation:              
 Basic     7,833,061     8,471,918           
 Diluted     8,136,961     8,471,918           
                   


America's Car-Mart, Inc.
Consolidated Results of Operations
(Operating Statement Dollars in Thousands)
 
          % Change  As a % of Sales 
       Six Months Ended  2016  Six Months Ended 
       October 31,  vs.  October 31, 
       2016   2015  2015 2016 2015
Operating Data:             
 Retail units sold    24,124     23,125     4.3 %      
 Average number of stores in operation    143     143     -         
 Average retail units sold per store per month    28.1     27.0     4.1        
 Average retail sales price $  10,442  $  10,098     3.4        
 Same store revenue growth  5.8%  2.4%         
 Net charge-offs as a percent of average finance receivables  14.0%  15.6%         
 Collections as a percent of average finance receivables  25.6%  27.7%         
 Average percentage of finance receivables-current (excl. 1-2 day) 80.2%  81.8%         
 Average down-payment percentage  5.8%  6.5%         
                  
Period End Data:             
 Stores open    143     145     (1.4)%      
 Accounts over 30 days past due  4.8%  3.5%         
 Finance receivables, gross $  474,295  $  427,663     10.9 %      
                  
Operating Statement:             
 Revenues:             
  Sales  $  262,854  $  245,265     7.2 %   100.0%   100.0%
  Interest income    33,196     30,428     9.1     12.6    12.4 
    Total    296,050     275,693     7.4     112.6    112.4 
                  
 Costs and expenses:             
  Cost of sales    153,510     146,682     4.7     58.4    59.8 
  Selling, general and administrative    45,822     45,363     1.0     17.4    18.5 
  Provision for credit losses    72,822     73,439     (0.8)    27.7    29.9 
  Interest expense    1,980     1,552     27.6     0.8    0.6 
  Depreciation and amortization    2,176     2,048     6.3     0.8    0.8 
  Loss on disposal of property and equipment    399     19     2,000.0     -     -  
    Total    276,709     269,103     2.8     105.3    109.7 
                  
    Income before taxes    19,341     6,590       7.4    2.7 
                  
 Provision for income taxes    7,214     2,458       2.7    1.0 
                  
    Net income $  12,127  $  4,132       4.6    1.7 
                  
 Dividends on subsidiary preferred stock  $  (20) $  (20)         
                  
    Net income attributable to common shareholders $  12,107  $  4,112          
                  
Earnings per share:             
 Basic  $  1.53  $  0.48          
 Diluted  $  1.48  $  0.46          
                  
                  
Weighted average number of shares outstanding:             
 Basic     7,890,993     8,492,679          
 Diluted     8,161,019     8,853,621          
                  


America's Car-Mart, Inc.
Consolidated Balance Sheet and Other Data
(Dollars in Thousands)
 
     October 31, April 30, October 31, 
      2016   2016   2015 
          
 Cash and cash equivalents $  170  $  602  $  1,386 
 Finance receivables, net $  362,955  $  334,793  $  327,229 
 Inventory  $  32,446  $  29,879  $  34,253 
 Total assets $  435,239  $  406,296  $  403,663 
 Total debt $  124,696  $  107,902  $  104,424 
 Treasury stock $  149,594  $  141,535  $  131,310 
 Stockholders' equity $  234,866  $  228,817  $  230,709 
 Shares outstanding    7,836,335     8,073,820     8,458,966 
          
          
          
 Finance receivables:      
  Principal balance $  474,295  $  437,278  $  427,663 
  Deferred revenue - payment protection plan   (18,476)    (17,305)    (16,061)
  Deferred revenue - service contract   (10,470)    (10,034)    (9,865)
  Allowance for credit losses   (111,340)    (102,485)    (100,434)
          
  Finance receivables, net of allowance and deferred revenue$  334,009  $  307,454  $  301,303 
          
          
  Allowance as % of principal balance net of deferred revenue 25.0%  25.0%  25.0%
          
          
          
 Changes in allowance for credit losses:     
      Six months   
      ended October 31,   
      2016   2015   
  Balance at beginning of period$  102,485  $  93,224   
  Provision for credit losses   72,822     73,439   
  Charge-offs, net of collateral recovered   (63,967)    (66,229)  
   Balance at end of period$  111,340  $  100,434   
          

Contacts:
William H. (“Hank”) Henderson, CEO or Jeffrey A. Williams, President and CFO at (479) 464-9944

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