PROG Holdings Inc (PRG, Financial), a leading fintech holding company, announced its financial results for the third quarter ended September 30, 2023, on October 25, 2023. The company exceeded expectations with strong portfolio performance and disciplined SG&A management, leading to a raised full-year outlook for 2023.
Financial Performance
PROG Holdings reported consolidated revenues of $582.9 million for Q3 2023, a decrease of 6.9% from the same period in 2022. This was primarily due to a lower Gross Leased Asset balance entering the quarter, slow retail traffic in key consumer durables, and year-over-year declines in the number of customers utilizing early lease buyout options. However, this was partially offset by continuing strong customer payment behavior.
Consolidated net earnings for the quarter were $35.0 million, compared with $16.0 million in the prior year period. Adjusted EBITDA for the quarter increased 10.4% to $71.7 million, or 12.3% of revenues, compared with $65.0 million, or 10.4% of revenues for the same period in 2022.
Progressive Leasing Results
Progressive Leasing's third quarter GMV decreased 6.5% to $409.2 million year over year, primarily due to continued demand softness for leasable goods. The provision for lease merchandise write-offs declined to 6.6% of lease revenues in the third quarter of 2023, due to strong customer payment behavior and lower write-offs resulting from the tightening of lease decisioning in mid-2022.
Liquidity and Capital Allocation
PROG Holdings ended the third quarter of 2023 with cash of $294.8 million and gross debt of $600 million. The Company repurchased $36.4 million of its stock in the quarter at an average price of $34.85 per share and has $229.0 million remaining under its previously announced $1 billion share purchase program.
2023 Outlook
The Company is updating its full year 2023 consolidated earnings and revenue outlook due to higher-than-expected performance in the third quarter and increased expectations for fourth quarter results. This outlook assumes continued soft demand for consumer durable goods, no material changes in the Company's decisioning posture or portfolio performance, and no impact from additional share purchases.
PROG Holdings Inc (PRG, Financial) is a fintech holding company that provides transparent and competitive payment options to consumers. The Company owns Progressive Leasing, Vive Financial, Four Technologies, and Build. More information on PROG Holdings and its companies can be found at https://investor.progholdings.com/.
