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Consumer Portfolio Services Inc. Reports Operating Results (10-Q)

August 16, 2010 | About:
10qk

10qk

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Consumer Portfolio Services Inc. (CPSS) filed Quarterly Report for the period ended 2010-06-30.

Consumer Portfolio Services Inc. has a market cap of $15.56 million; its shares were traded at around $0.89 with and P/S ratio of 0.07. Consumer Portfolio Services Inc. had an annual average earning growth of 52.1% over the past 5 years.CPSS is in the portfolios of Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Revenues. During the three months ended June 30, 2010, revenues were $38.5 million, a decrease of $19.8 million, or 33.9%, from the prior year revenue of $58.3 million. The primary reason for the decrease in revenues is a decrease in interest income. Interest income for the three months ended June 30, 2010 decreased $19.8 million, or 36.0%, to $35.2 million from $55.0 million in the prior year. The primary reason for the decrease in interest income is the decrease in finance receivables held by consolidated subsidiaries.

At June 30, 2010, we were generating income and fees on a managed portfolio with an outstanding principal balance of $931.6 million (this amount includes $107.9 million of automobile contracts on which we earn servicing fees, own 5.0% of the asset-backed notes issued by the related trust, and own a residual interest and also includes another $103.9 million of automobile contracts on which we earn servicing fees and own a note collateralized by such contracts), compared to a managed portfolio with an outstanding principal balance of $1,333.9 million as of June 30, 2009. At June 30, 2010 and 2009, the managed portfolio composition was as follows:

Interest expense for the three months ended June 30, 2010 decreased $8.0 million, or 27.6%, to $21.0 million, compared to $29.0 million in the previous year. The decrease is primarily the result of changes in the amount and composition of debt carried on our consolidated balance sheet. Interest on securitization trust debt decreased by $9.0 million in the three months ended June 30, 2010 compared to the prior year. For the current period, interest on securitization trust debt includes $552,000 in interest expense on our $50 million term funding facility that was established in March 2010 and had an outstanding balance of $16.6 million at June 30, 2010. Interest expense on senior secured and subordinated debt increased by $239,000, and interest expense on residual interest financing decreased $355,000 in the three months ended June 30, 2010 compared to the prior year. Interest expense on warehouse debt increased by $1.1 million for the three months ended June 30, 2010 compared to the prior year as a result of our increased new contract purchases in 2010. We have increased our borrowings on the $50 million credit facility established in September 2009 to provide funding for these purchases. As of June 30, 2010, it had an outstanding balance of $29.5 million. In the prior period, we had no access to additional warehouse funding but were paying interest on an amortizing facility, which had an outstanding balance equal to $5.1 million as of June 30, 2009.

Revenues. During the six months ended June 30, 2010, revenues were $83.1 million, a decrease of $41.3 million, or 33.2%, from the prior year revenue of $124.4 million. The primary reason for the decrease in revenues is a decrease in interest income. Interest income for the six months ended June 30, 2010 decreased $42.0 million, or 36.2%, to $74.1 million from $116.1 million in the prior year. The primary reason for the decrease in interest income is the decrease in finance receivables held by consolidated subsidiaries.

At June 30, 2010, we were generating income and fees on a managed portfolio with an outstanding principal balance of $931.6 million (this amount includes $107.9 million of automobile contracts on which we earn servicing fees, own 5.0% of the asset-backed notes issued by the related trust, and own a residual interest and another $103.9 million of automobile contracts on which we earn servicing fees and own a note collateralized by such contracts), compared to a managed portfolio with an outstanding principal balance of $1,333.9 million as of June 30, 2009. At June 30, 2010 and 2009, the managed portfolio composition was as follows:

Interest expense for the six months ended June 30, 2010 decreased $17.8 million, or 29.1%, to $43.3 million, compared to $61.1 million in the previous year. The decrease is primarily the result of changes in the amount and composition of debt carried on our consolidated balance sheet. Interest on securitization trust debt decreased by $18.9 million in the six months ended June 30, 2010 compared to the prior year. For the current period, interest on securitzation trust debt includes $572,000 in interest expense on our $50 million term funding facility that was established in March 2010 and had an outstanding balance of $16.6 million at June 30, 2010. Interest

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