America's CAR-MART Inc (CRMT) 2024 Q1 法說會逐字稿

Good morning, everyone. Thank you for holding, and welcome to America's Car-Mart First Quarter Fiscal 2024 Conference Call. Before we begin, today's call is being recorded and will be available for replay for the next 12 months.

大家，早安。感謝您召開並歡迎參加美國 Car-Mart 2024 財年第一季電話會議。在我們開始之前，我們正在對今天的通話進行錄音，並將在接下來的 12 個月內進行重播。

During today's call, management may make certain statements that are considered forward-looking, which inherently involve risks and uncertainties that could cause actual results to differ materially from management's present view. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

在今天的電話會議中，管理階層可能會做出某些被視為前瞻性的陳述，這些陳述本身就涉及風險和不確定性，可能導致實際結果與管理階層目前的觀點有重大差異。這些聲明是根據 1995 年《私人證券訴訟改革法案》的安全港條款作出的。

The company cannot guarantee the accuracy of any forecast or estimate nor does it undertake any obligation to update such forward-looking statements. For more information regarding forward-looking information, please see Part 1 of the company's annual report on Form 10-K for the fiscal year ended April 30, 2023, and its current and quarterly reports furnished to or filed with the Securities and Exchange Commission on Forms 8-K and 10-Q.

該公司不能保證任何預測或估計的準確性，也不承擔更新此類前瞻性陳述的任何義務。有關前瞻性資訊的更多信息，請參閱公司截至 2023 年 4 月 30 日的財年 10-K 表格年度報告的第 1 部分，以及向美國證券交易委員會提供或提交的當期報告和季度報告。形式8-K 和10-Q。

Please see the company's website for the earnings release for the first quarter of fiscal 2024, along with the second news release about a leadership transition. Participating on the call this morning are Jeff Williams, CEO; Doug Campbell, President; and Vickie Judy, CFO.

請參閱該公司網站，以了解 2024 財年第一季的收益發布以及有關領導層換屆的第二份新聞稿。今天早上參加電話會議的有執行長傑夫威廉斯 (Jeff Williams)；道格·坎貝爾，總裁；和財務長 Vickie Judy。

I will now turn the call over to Jeff Williams, CEO. You may begin.

我現在將把電話轉給執行長傑夫威廉斯 (Jeff Williams)。你可以開始了。

Okay. Well, thank you for joining us on the call this morning, and thank you for your interest in America's Car-Mart. I'm pleased to report that we delivered strong revenue growth for the quarter. We had solid improvements in many areas of our business. Near-term credit results are a challenge, and we'll discuss that in more detail in just a few minutes.

好的。好的，感謝您今天早上參加我們的電話會議，也感謝您對 America's Car-Mart 的興趣。我很高興地報告，我們本季實現了強勁的收入成長。我們在業務的許多領域都取得了紮實的進步。近期信貸結果是一個挑戰，我們將在幾分鐘內更詳細地討論這個問題。

Before we get into the details, I'm excited to cover our other news today that President, Doug Campbell, will succeed me as CEO effective October 1. Over the last year in his role as President, Doug has more than demonstrated his readiness for the new role.

在我們詳細介紹之前，我很高興先介紹一下今天的另一則訊息：總裁道格·坎貝爾(Doug Campbell) 將於10 月1 日接替我擔任執行長。在擔任總裁的過去一年裡，道格·坎貝爾(Doug Campbell) 充分證明了他已經做好了準備新角色。

In my role as CEO and a Board member, there are many responsibilities, but succession planning has been at the very top of the list for me, identifying a candidate with a strong cultural fit, the skill set to capitalize on opportunities and navigate the challenges ahead is why we first engaged with Doug almost 2 years ago now.

身為執行長和董事會成員，我有很多職責，但繼任計畫對我來說是最重要的，它要確定一位具有很強的文化契合度、具備利用機會和應對挑戰的技能的候選人前進就是我們大約兩年前第一次與道格接觸的原因。

Doug's appreciation of the company's culture, strong industry knowledge and being a change agent is why he's the perfect fit to lead us to the next level. Our transition plan will allow for a smooth handoff and I'll be here to fully support Doug as we move forward.

道格（Doug）對公司文化的欣賞、豐富的行業知識以及作為變革推動者的能力，是他非常適合帶領我們邁向新高度的人選。我們的過渡計畫將實現順利交接，我將在我們前進的過程中全力支持道格。

So congratulations, and thank you, Doug. I'll now turn it over to Vickie and Doug to review the quarter results, update you on the status of initiatives and provide an outlook on our business. Doug?

恭喜你，謝謝你，道格。現在我將把它交給 Vickie 和 Doug 來審查季度業績，向您介紹最新的計劃狀態並提供我們業務的前景。道格？

Thanks, Jeff. I want to thank Jeff for all that he's done for the company over his 18 years of service and in particular, the last 6 years as CEO. We have continued to source inventory and grow our business despite the industry being very constrained and volatile over the last couple of years. While competitors are exiting the business unable to manage capital constraints, we have been investing in our business.

謝謝，傑夫。我要感謝傑夫在 18 年的服務中，特別是在過去 6 年擔任執行長期間為公司所做的一切。儘管過去幾年該行業非常受限且不穩定，但我們仍在繼續採購庫存並發展業務。當競爭對手因無法管理資本限製而退出該業務時，我們一直在投資我們的業務。

It's in stark contrast with how others are managing through the environment and a testament to Jeff's both leadership and vision for the company in what has been one of the most challenging environments in the history of our industry. I owe Jeff indebted gratitude for the time he has spent with me over the last year, and during that time, we've cultivated a fantastic working relationship that will serve us in facilitating the transition ahead.

這與其他人在環境中進行管理的方式形成鮮明對比，並證明了傑夫在我們行業歷史上最具挑戰性的環境之一中的領導力和對公司的願景。我非常感謝傑夫在過去一年與我一起度過的時光，在那段時間裡，我們建立了良好的工作關係，這將有助於我們促進未來的過渡。

I'm equally appreciative to our Chair and our Board members who have been investing in my development and their feedback and guidance has been valuable. On a personal note, I'm deeply humbled and thankful for the opportunity. As I look forward, I'm more enthusiastic about our future here at America's Car-Mart than it was a year ago. We're focused on the long-term health and success of our business and are demonstrating our ability to operate in any environment.

我同樣感謝我們的主席和董事會成員，他們一直致力於我的發展，他們的回饋和指導非常寶貴。就我個人而言，我對這個機會深感謙卑和感激。展望未來，我對 America's Car-Mart 的未來比一年前更充滿熱情。我們專注於業務的長期健康和成功，並展示我們在任何環境下運作的能力。

Before we transition over to the quarterly results, I'd like to thank our associates who worked tirelessly to deliver improvements in sales volume, gross margin, procurement efforts, wholesale performance and reductions in repair spend.

在我們轉向季度業績之前，我要感謝我們的員工，他們不懈努力，在銷售、毛利率、採購工作、批發業績和維修支出的減少方面取得了進步。

Their relentless pursuit to both put and keep our customers on the road continues to be a winning combination. Let's start with sales performance. Our sales performance was strong, generating 15,912 units sold, which was up 2.4% over the prior year's quarter. Same-store sales base is up 8.2%. That had a nice impact on inventory turns as those moved up from 5.9 to 7.2 turns.

他們對讓我們的客戶繼續前進的不懈追求仍然是一個成功的組合。讓我們從銷售業績開始。我們的銷售業績強勁，售出 15,912 輛，比去年同期成長 2.4%。同店銷售額成長 8.2%。這對庫存週轉率產生了很好的影響，庫存週轉率從 5.9 週轉至 7.2 週。

Growth in online credit applications was up 19% for the quarter, which was mentioned in the press release. That accounts for about 70% of all of our applications. Overall, application volume was up 8.1% when including the walk-on traffic that we see in our dealerships. This is especially impressive when you consider that we've now begun to augment our advertising spend because of the power of LOS and its ability to drive online traffic.

新聞稿中提到，本季線上信貸申請成長了 19%。這約占我們所有應用程式的 70%。整體而言，如果包括我們在經銷商看到的上門客流量，申請量增加了 8.1%。當您考慮到由於 LOS 的力量及其推動線上流量的能力，我們現在已經開始增加廣告支出，這一點尤其令人印象深刻。

The LOS continues to be the primary driver for our sales growth despite what is a down cycle for many with the remainder of the industry down in sales year-over-year during the same period. Credit availability continues to be an issue for the industry and is tighter than previous year when looking at COX Automotive's Dealertrack Credit Availability Index.

儘管對許多人來說正處於下滑週期，而同期行業其他公司的銷售額同比下降，但 LOS 仍然是我們銷售成長的主要推動力。信貸可用性仍然是該行業面臨的問題，並且從 COX Automotive 的 Dealertrack 信貸可用性指數來看，信貸可用性比去年更加緊張。

It has shown some mild improvement in the last month or 2, but it's still worse when comparing it to pre-pandemic periods. This is a benefit for us as consumers now look to us for access to credit. When I think about average selling prices during the quarter, they were up by 4.1% year-over-year. About half of that was related to the price of the vehicle. The other half was related to the ancillary products that we sell.

在過去一兩個月裡，情況有所改善，但與疫情大流行前相比，情況仍然更糟。這對我們來說是一個好處，因為消費者現在向我們尋求信貸。考慮到本季的平均售價，年增了 4.1%。其中大約一半與車輛的價格有關。另一半則與我們銷售的輔助產品有關。

On the last call, I discussed that the cars we were purchasing during the spring market were up about 3%, so there should be no surprise here. However, we also mentioned that the cars that we are buying are newer and have lower mileage. This ultimately makes it eligible for longer warranties, which generates more revenue in the selling prices.

在上次電話會議上，我討論了我們在春季市場購買的汽車上漲了約 3%，所以這裡應該不足為奇。然而，我們也提到，我們購買的汽車較新，行駛里程較低。這最終使它有資格獲得更長的保固期，從而產生更多的銷售價格收入。

As a reminder, this is now even more pronounced when you consider the price increase that we made to our service contracts in December of last year. The industry saw wholesale pricing decline sharply in May and June, while prices in July decreased at a more normalized rate. During the first quarter, our procurement teams lowered purchase prices sequentially throughout the quarter, contributing to a 3% reduction in prices from where we started.

提醒一下，當您考慮到我們去年 12 月對服務合約的價格上漲時，這一點現在更加明顯。 5 月和 6 月，該行業的批發價格大幅下降，而 7 月的價格下降幅度更為正常。在第一季度，我們的採購團隊在整個季度連續降低了採購價格，導致價格較開始時下降了 3%。

August wholesale pricing is showing price increases, which is at normal this time of year. It could be related to the sales strength we're seeing in the overall marketplace in August or low inventory days supply on the ground. And I think some speculation of what will happen between negotiations with the UAW and the Big 3 in Detroit.

八月份的批發價格出現價格上漲，這是每年這個時候的正常情況。這可能與我們在八月整個市場看到的銷售強勁或當地庫存天數較低有關。我認為有人猜測與美國汽車工人聯合會和底特律三巨頭的談判將會發生什麼。

We're keeping a close eye on that and what's transpiring and working to mitigate any effects and mute some of its effects there. Gross margin came in at 34.6%, which was up 20 basis points compared to last year and up 120 basis points when I look at it sequentially versus the fourth quarter. We went into a fair bit of detail in the press release regarding gross margin and articulated what our plan was on the last call. So I don't want to be too redundant. But to put it simply, we're executing at an elevated level on the plan that we had laid out. We are now -- we are buying newer and lower mileage assets and those are trickling through our ecosystem.

我們正在密切關注這一情況以及正在發生的事情，並努力減輕任何影響並消除其中的一些影響。毛利率為 34.6%，比去年增長了 20 個基點，與第四季度相比增長了 120 個基點。我們在新聞稿中詳細介紹了有關毛利率的信息，並在上次電話會議上闡明了我們的計劃。所以我不想太多餘。但簡單地說，我們正在以更高的水平執行我們制定的計劃。我們現在正在購買更新、里程更低的資產，這些資產正在我們的生態系統中不斷湧現。

We're improving the performance of our operations teams as it relates to vehicle repairs and we continue to scale our reconditioning initiative, which has a target savings of $300 to $500 per unit. We're seeing progress in all 3 areas, which isn't surprising, but I guess I'm really encouraged at the rate at which we're seeing in some of this benefit. We had estimated that we could recover 260 basis points of gross margin to achieve a 36% target that we alluded to on the last call.

我們正在提高與車輛維修相關的營運團隊的績效，並繼續擴大我們的翻新計劃，目標是每台節省 300 至 500 美元。我們在所有三個領域都看到了進展，這並不奇怪，但我想我對我們在其中一些好處中看到的速度感到非常鼓舞。我們預計毛利率可以恢復 260 個基點，以實現我們在上次電話會議中提到的 36% 的目標。

However, there are other opportunities that we're now exploring. I'll give you an example. Transportation would be one of these. Last year, we changed the technology stack that we use to move vehicles throughout our ecosystem by optimizing loads and routes. We began to roll this out in the fourth quarter, but Q1 is the first full quarter we're seeing the benefit. It represented an improvement of 20 basis points in gross margin when compared to the first quarter of last year.

然而，我們現在正在探索其他機會。我給你舉個例子。交通運輸就是其中之一。去年，我們透過優化負載和路線，改變了用於在整個生態系統中移動車輛的技術堆疊。我們在第四季度開始推出此功能，但第一季是我們看到收益的第一個完整季度。與去年第一季相比，毛利率提高了 20 個基點。

And ultimately, we're now saving about 15% on the way we move our vehicles. There are other opportunities with ancillary products, wholesale and repairs that we're looking at to drive even further improvements beyond what was initially indicated. Some of these opportunities can be realized during this fiscal year. Others will be more long term in nature.

最終，我們現在在運輸車輛的過程中節省了約 15%。我們正在尋找與輔助產品、批發和維修有關的其他機會，以推動超出最初預期的進一步改進。其中一些機會可以在本財年實現。其他的則本質上是更長期的。

I'll now turn it over to Vickie, who will cover our financial results.

現在我將把它交給 Vickie，她將報道我們的財務表現。

Good morning, and thank you, Doug. For the current quarter, our net charge-offs as a percentage of average finance receivables were 5.8%. That's compared to 5.1% for the first quarter of '23 and 6.3% sequentially. It is above our 5-year average of 5% and our 10-year average of 5.6% for first quarters. Both of these include the low credit loss pandemic period.

早安，謝謝你，道格。本季度，我們的淨沖銷占平均財務應收帳款的百分比為 5.8%。相比之下，2023 年第一季為 5.1%，上一季為 6.3%。第一季的成長率高於 5 年平均 5% 和 10 年平均 5.6%。這兩者都包括低信用損失大流行時期。

For some comparisons prepandemic, our first quarter losses for fiscal year '18 and '19 were 6.1%. A little over half of the increase in losses contributed compared to the first quarter of fiscal '23 was due to the higher severity of losses and the remainder being an increased frequency in the losses.

與大流行前相比，我們 18 財年和 19 財年第一季的虧損為 6.1%。與 23 財年第一季相比，損失增加的一半多是由於損失嚴重程度較高，其餘部分則是損失頻率增加。

Our recovery values were down from historically high levels in the prior year quarter of 32% and held flat sequentially at approximately 27%. As of July 31, the allowance for loan losses was 23.91% of finance receivables, net of deferred revenue. And as discussed in the press release, our provision exceeded actual charge-offs by $14.8 million. We have over $125 million of deferred revenue on the balance sheet. And in addition, we also collected an additional $12 million in interest income, an increase of 27.3% when compared to Q1 of fiscal '23.

我們的回收率較去年同期 32% 的歷史高點有所下降，與上一季持平，約 27%。截至 7 月 31 日，貸款損失準備金佔應收財務帳款（扣除遞延收入）的 23.91%。正如新聞稿中所討論的，我們的撥備超過實際沖銷 1,480 萬美元。我們的資產負債表上有超過 1.25 億美元的遞延收入。此外，我們還額外獲得了 1,200 萬美元的利息收入，與 23 財年第一季相比成長了 27.3%。

We also mentioned in the press release the benefit of the LOS and attracting additional customers. It's also going to be instrumental in helping us improve deal structures and ultimately, the success rate of our customers once it is fully implemented across all lots. Our customer scores during the quarter remained consistent with the prior year.

我們也在新聞稿中提到了 LOS 的好處以及吸引更多客戶的好處。一旦在所有批次中全面實施，它也將有助於幫助我們改善交易結構，並最終提高我們客戶的成功率。本季我們的客戶評分與上一年保持一致。

On the delinquency side, our accounts 30-plus past due was at 4.4% compared to 3.6% in the prior year quarter. The month ending on a Monday versus a Sunday in the prior year contributed to part of this as well as the continuing negative impact of the inflationary environment on our customers.

在拖欠方面，我們超過 30 年的帳戶逾期率為 4.4%，而去年同期為 3.6%。與前一年相比，以周一結束的月份在一定程度上造成了這種情況，以及通膨環境對我們客戶的持續負面影響。

Total collections were up 12% to $166 million and total collections per active customer per month were $535 compared to $516 in the prior year quarter. We continue to work with our customers on payment options and modifications in an effort to keep them in the vehicle and successful on their contract.

總收款金額成長 12%，達到 1.66 億美元，每位活躍客戶每月的總收款額為 535 美元，而去年同期為 516 美元。我們將繼續與客戶就付款方式和修改進行合作，努力讓他們繼續留在車輛中並成功履行合約。

The average originating contract term for the quarter was 44.7 months compared to 42.8 for the prior year quarter and up slightly from 43.5 months sequentially. We added 1.9 months to the originating contract term compared to the prior year first quarter to assist our customers with an affordable payment.

本季的平均原始合約期限為 44.7 個月，去年同期為 42.8 個月，比上一季的 43.5 個月略有上升。與去年第一季相比，我們將原始合約延長了 1.9 個月，以幫助我們的客戶獲得負擔得起的付款。

Our weighted average contract term for the entire portfolio, including modifications, was 46.9 months compared to 44 for the prior year quarter. The weighted average age of the portfolio increased to approximately 10.4 months. The percentage of the portfolio held by the highest credit quality customers continues to improve compared to the prior year.

我們整個投資組合的加權平均合約期限（包括修改）為 46.9 個月，而去年同期為 44 個月。投資組合的加權平均年齡增加至約10.4個月。與前一年相比，最高信用品質客戶持有投資組合的比例持續提高。

On the SG&A side, we've been focused on identifying efficiencies in the business across the board. And as mentioned in the release, we had a savings on our SG&A spend of over $600,000 from the fourth quarter, excluding the stock-based compensation. A large percentage of the savings was in advertising. We continue to shift more of our advertising dollars to digital spend, which is more efficient and also help supplement our LOS efforts.

在SG&A 方面，我們一直專注於全面確定業務效率。正如新聞稿中所提到的，從第四季度開始，我們的 SG&A 支出節省了超過 60 萬美元，不包括基於股票的薪酬。節省的很大一部分都花在了廣告上。我們繼續將更多的廣告資金轉向數位支出，這更加高效，也有助於補充我們的 LOS 工作。

Our customer count increased by 8.1% over the prior year to almost 105,000 customers. Our SG&A spend per average customer improved over the prior year first quarter and over the sequential quarter. Our investments are being made to better serve this growing base while improving the efficiencies as we move forward. And although we continually evaluate our return on investment and allocation of capital, it becomes even more important in this environment of increasing funding costs.

我們的客戶數量比前一年增加了 8.1%，達到近 105,000 名客戶。我們的每位客戶的銷售、管理及行政費用 (SG&A) 支出比去年第一季和上一季有所改善。我們的投資是為了更好地服務這個不斷成長的群體，同時提高我們前進的效率。儘管我們不斷評估投資回報和資本配置，但在融資成本不斷增加的環境下，這一點變得更加重要。

With that in mind, we did close 2 underperformed dealerships during the quarter to better allocate our available capital. We'll continue to review and monitor capital invested in each dealership and other investments to maximize returns. At quarter end, we had $6.3 million in unrestricted cash and approximately $159 million in additional availability under our revolving credit facilities based on our current borrowing base of receivables and inventory.

考慮到這一點，我們在本季度關閉了兩家表現不佳的經銷商，以更好地分配我們的可用資本。我們將繼續審查和監控每個經銷商的資本投資和其他投資，以實現最大回報。截至季末，根據我們目前的應收帳款和庫存借款基礎，我們的循環信貸安排下擁有 630 萬美元的非限制性現金和約 1.59 億美元的額外可用資金。

Our total securitized nonrecourse notes payable was $711.8 million, with $86 million in restricted cash related to those notes. We closed on our third securitization in early July with net proceeds of $356 million and a coupon of 8.8%. And this paid off our revolving line of credit.

我們的證券化無追索權應付票據總額為 7.118 億美元，其中與這些票據相關的限制性現金為 8,600 萬美元。我們在 7 月初完成了第三次證券化，淨收益為 3.56 億美元，票面利率為 8.8%。這還清了我們的循環信貸額度。

Our total debt, net of cash to finance receivables ratio is at 42.9% and up from 41.5% at April 30. Interest expense increased $6.9 million with approximately 60% of that related to the increased rates over the prior year and the remainder a result of the increased borrowings.

我們的總債務（扣除現金與應收帳款融資比率）為42.9%，高於4 月30 日的41.5%。利息支出增加了690 萬美元，其中約60% 與上一年的利率增加有關，其餘則由於增加的借款。

I'll now let Jeff to close this out.

我現在讓傑夫結束這個話題。

Okay. Well, thank you, Vickie. The demand for our offering will continue to increase. Our model is the very best way to serve our high-touch customer base and the unique challenges that require a balance between face-to-face decentralized decisioning and leveraging scale where it makes sense.

好的。好吧，謝謝你，維琪。對我們產品的需求將持續增加。我們的模式是服務我們高接觸客戶群和獨特挑戰的最佳方式，這些挑戰需要在面對面的分散決策和合理利用規模之間取得平衡。

We're striking just the right balance, and that's more apparent as we continue to pick up market share. Current demand exceeds what we can supply. We believe that affordability will improve over time as basic transportation must be available for average consumers. Currently, many customers are sitting out and will flow back into the market over time.

我們正在取得適當的平衡，隨著我們繼續擴大市場份額，這一點變得更加明顯。目前的需求超出了我們的供應能力。我們相信，隨著時間的推移，負擔能力將會提高，因為一般消費者必須能夠獲得基本的交通服務。目前，許多客戶都在觀望，隨著時間的推移，他們將回流市場。

In many respects, our customers are always in recession, which makes the current environment ideal as we focus on affordability and delivering outstanding service to keep our customers on the road. Foundational investments are nearing completion and will be leveraged, allowing us to become a more efficient data-driven company.

在許多方面，我們的客戶總是處於經濟衰退之中，這使得當前的環境非常理想，因為我們專注於負擔能力並提供卓越的服務，以讓我們的客戶繼續前進。基礎投資已接近完成並將充分利用，使我們能夠成為一家更有效率的數據驅動型公司。

We've not yet seen the benefit that will come. We're on track to sell between 40 and 50 retail units per dealership per month in the next few years and eventually serve 1,000 customers per dealership. We believe credit results will improve, especially as we look at the opportunities with the LOS, increasing car quality and execution levels.

我們還沒有看到將會帶來的好處。我們預計在未來幾年內每個經銷商每月銷售 40 到 50 個零售單位，並最終為每個經銷商 1,000 名客戶提供服務。我們相信信用結果將會改善，特別是當我們關注 LOS 的機會、提高汽車品質和執行水準時。

We believe gross profit percentages will improve and will leverage SG&A as we move forward. And as discussed in the press release, we're in a unique period in the industry, and we have significant opportunities in the acquisitions areas.

我們相信，隨著我們的前進，毛利率將會提高，並將利用銷售及管理費用。正如新聞稿中所討論的，我們正處於行業的獨特時期，我們在收購領域擁有重大機會。

And we're talking to several strong operators with highly accretive opportunities, very excited about that. We have great days ahead and Doug is ready to lead our team forward.

我們正在與幾家擁有高度增值機會的強大運營商進行交談，對此我們感到非常興奮。我們的日子很美好，道格已準備好帶領我們的團隊前進。

Thank you to all of our passionate associates who have signed on to our vision to be the best and dreams big about what we could be while taking care of our customers one at a time. Thank you, and we'll now open it up for questions. Operator?

感謝我們所有充滿熱情的員工，他們認同我們的願景，即成為最好的，並夢想著我們在一次一次照顧我們的客戶的同時能夠做到什麼。謝謝您，我們現在將開放提問。操作員？

(Operator Instructions) And our first question comes from John Murphy from Bank of America.

（操作員說明）我們的第一個問題來自美國銀行的約翰·墨菲。

Congrats to Jeff and Doug on the next legs of your careers here. I guess just a first question. When you think about the extension in contract terms to help with the monthly affordability equation, I'm just curious if you think that ever reverses? Or is this something that is now structurally in place and that we'll continue to see lengthening? Or has there been a period of time Car-Mart's history or over time where contract terms have actually shortened once they've been landed over time?

恭喜傑夫和道格在這裡開啟職業生涯的下一步。我想這只是第一個問題。當你考慮延長合約條款以幫助解決每月負擔能力方程式時，我只是好奇你是否認為這種情況會逆轉？或者這是現在結構上已經到位並且我們將繼續看到延長的東西？或者說，Car-Mart 的歷史中是否有一段時間，或者隨著時間的推移，一旦合約期限隨著時間的推移而實際上縮短了？

Yes. We do see an opportunity in the future to reel back in and decrease terms as we go forward. Our customers' wages continue to go up. And I think the last few months, few quarters, we've seen real wage increases for our consumers. So we do feel like eventually, we can move that term in the other direction.

是的。我們確實看到了未來有機會在前進的過程中收回並減少條款。我們客戶的薪資持續上漲。我認為在過去的幾個月、幾個季度中，我們已經看到消費者的實際工資有所增長。所以我們確實覺得最終我們可以將該術語移向另一個方向。

But that's going to be based to a large extent on what happens with car prices and wages as we go forward and other inflationary pressures. But we would certainly like to really in term, and we do think there's a very realistic and real possibility of us moving that direction, especially as we look at the LOS and all the different features and functions and benefits we're going to get when that tool gets fully rolled in.

但這在很大程度上取決於未來汽車價格和工資的變化以及其他通膨壓力。但我們確實希望真正做到這一點，而且我們確實認為我們朝這個方向前進的可能性非常現實和真實，特別是當我們考慮 LOS 以及我們將獲得的所有不同特性、功能和優勢時。該工具已完全投入使用。

That's helpful. And then just a follow-up on some of the comments that were made in the press release about the changes in purchase and disposition of vehicles. And I'm just wondering if you could sort of expand on what changes have actually occurred? And is it something where we're just looking at slightly newer vehicles that are being put into inventory that have lower recon costs, and that's the efficiencies that are gained and just what's actually changing there that's making that more efficient over time? Because I thought you've been pretty good at that historically, but it sounds like you see room for improvement.

這很有幫助。然後是新聞稿中有關車輛購買和處置變化的一些評論的後續行動。我只是想知道您是否可以擴展一下實際發生的變化？我們是否只是專注於那些稍微較新的車輛，這些車輛被放入庫存中，偵察成本較低，這就是所獲得的效率，以及隨著時間的推移，實際發生的變化是什麼，使得效率更高？因為我認為您在歷史上一直非常擅長這一點，但聽起來您似乎還有改進的空間。

Yes. Thanks for the question. I would say historically, we have been very good at that. It was, I think, my very first call on -- that I spoke about how we had used that as a lever to mitigate some of the costs. And we went to a little bit older car with a little bit higher mileage. And while it had its benefits upfront, there's a repair cost associated with that downstream, which has been somewhat problematic.

是的。謝謝你的提問。我想說，從歷史上看，我們在這方面一直非常擅長。我想，這是我第一次打電話，我談到了我們如何利用它作為槓桿來減輕一些成本。我們開的是一輛舊一點、里程數高一點的車。雖然它在前期有其好處，但與下游相關的維修成本卻存在一些問題。

And so what we're trying to do is get back to our historical norms. But beyond that, we've seen efficiency gains what I would call that are more closer pre-pandemic levels. And so the car we used to sell might have been 9 or 10 years old, we're able to shave a year off that and improve the overall mileage by 10,000 to 12,000 miles, what I would call versus pre-pandemic.

所以我們要做的就是回到我們的歷史規範。但除此之外，我們也看到了效率的提高，我稱之為更接近疫情前的水準。因此，我們過去銷售的汽車可能已有 9 或 10 年的車齡，我們可以將其縮短一年，並將總里程提高 10,000 至 12,000 英里，我稱之為與大流行前相比。

So the car inherently is a lower mileage car, which should generate less in repairs and ultimately, I think it gives us a second chance at retailing the unit, should we have to go down the repossession route. It creates a second chance to -- for the inventory to have another purpose in our business.

因此，這輛車本質上是一輛里程數較低的汽車，維修費用應該會更少，最終，我認為如果我們必須走上收迴路線，這給了我們第二次零售該車的機會。它創造了第二次機會——讓庫存在我們的業務中發揮另一個作用。

John, I would add in the last 2 or 3 years with the pandemic and the chip shortage and the used car issues and all the supply chain issues we had that there was some real disruption in our historical performance on product and procurement and is kind of working itself out at the same time that we're making some good improvements internally.

約翰，我想補充一點，在過去的兩三年裡，由於大流行、晶片短缺、二手車問題以及我們遇到的所有供應鏈問題，我們在產品和採購方面的歷史表現確實受到了一些幹擾，這有點像在我們內部進行一些良好改進的同時，我們也在努力解決問題。

(Operator Instructions) And our next question comes from Kyle Joseph from Jefferies.

（操作員說明）我們的下一個問題來自 Jefferies 的 Kyle Joseph。

Congrats Jeff. Anyway, so kind of piggybacking on that last question in terms of gross profit margin. Obviously, used car prices have been elevated. It seemed like they may be coming back to earth for a while. But longer term, do you think the gross profit margin has changed systemically? Or do you think gradually over time and get back to where it was?

恭喜傑夫。無論如何，就毛利率而言，這是對最後一個問題的支持。顯然，二手車價格已經上漲。看起來他們可能要回到地球一段時間了。但從長遠來看，您認為毛利率是否發生了系統性變化？或者你會隨著時間的推移逐漸思考並回到原來的狀態嗎？

Yes. Thanks, Kyle, for the question. I think there's an opportunity to sort of have a middle ground there. But as we sort of called out earlier, maybe we set our expectations a little too low on that 36%, and we're realizing in real time. There's benefits beyond what we initially anticipated, especially when you consider items like transportation that maybe wasn't sort of initially on the table, but we're looking at any and all things in the business to sort of drive improvements there.

是的。謝謝凱爾提出的問題。我認為有機會達成中間立場。但正如我們之前所指出的，也許我們對 36% 的期望有點太低了，但我們正在即時意識到這一點。這些好處超出了我們最初的預期，特別是當你考慮到運輸等最初可能並未考慮到的項目時，但我們正在考慮業務中的所有事項，以推動那裡的改進。

One thing that I didn't mention in the last answer was what we own those cars relative to the book value. And if I just go back, if I used, I call it, this time last year and to the current time. So over the last 12 or 13 months, how we own those cars relative to the book has improved 8% or 9%. So it's a combination of an improvement of how these cars are starting life in our portfolio.

我在上一個答案中沒有提到的一件事是我們擁有這些汽車相對於帳面價值的價值。如果我回去，如果我使用過，我稱之為去年的這個時候和目前的時間。因此，在過去的 12 或 13 個月裡，我們擁有這些汽車的方式相對於帳本已經改善了 8% 或 9%。因此，這是我們產品組合中這些汽車的啟動方式的改進的結合。

There's the improvement in a younger car with lower miles which all should have benefits downstream in terms of credit loss and fair market value retention, right? It sort of takes some of that risk and exposure off the table.

里程數較低的年輕汽車有所改進，這一切都應該在信用損失和公平市場價值保留方面為下游帶來好處，對嗎？這在某種程度上消除了一些風險和暴露。

Got it. Very helpful. And then, yes, my follow-up would be the health of the underlying consumer. I know you mentioned the quarter ended on a different day and -- but at the end of the day, the low-end consumer still employed inflation pressures are easing a bit? How would you gauge the health of your underlying consumer?

知道了。很有幫助。然後，是的，我的後續行動將是潛在消費者的健康狀況。我知道您提到該季度在另一天結束，但最終，仍在就業的低端消費者通膨壓力是否有所緩解？您如何衡量潛在消費者的健康狀況？

Yes. I don't think we're seeing any large changes yet. Again, to your point, unemployment still very low. They're working, wages are still good, hours worked are still good. But there are still a lot of inflationary pressures and just the adjustment to those inflationary pressures and the lack of stimulus that was there for a point in time.

是的。我認為我們還沒有看到任何重大的變化。再說一次，就你的觀點而言，失業率仍然很低。他們在工作，薪水仍然不錯，工作時間仍然不錯。但通膨壓力仍然存在，而且只是對這些通膨壓力的調整以及在某個時間點缺乏刺激措施。

So credit, the use of credit has gone back up for our consumers. We're seeing that kind of across the board. But again, our consumers are almost typically always in a recession, living paycheck to paycheck. So it's really just an adjustment and getting them back used to the higher car payments and keeping them in their car.

因此，我們的消費者對信貸的使用已經恢復。我們全面看到了這種情況。但同樣，我們的消費者幾乎總是處於經濟衰退之中，靠著薪水過活。所以這實際上只是一種調整，讓他們重新習慣更高的汽車付款並讓他們留在自己的車上。

But overall, the health of our consumer is increasing quarter-over-quarter. As we move forward, we believe that's going to be a better situation for us. As we go forward and as Vickie mentioned, unemployment rates are historically low and real wages are gaining some steam in the areas we serve and the customers we serve.

但整體而言，我們消費者的健康狀況逐季提高。隨著我們的前進，我們相信這對我們來說將會是一個更好的情況。隨著我們前進，正如 Vickie 所提到的，失業率處於歷史低位，而我們服務的地區和客戶的實際工資正在增長。

And I think a piece of that is, as Doug mentioned, the tightening in the lending environment, we are seeing a different cohort of consumers come down into our market. We continue to see that.

我認為，正如道格所提到的，貸款環境收緊，我們看到不同的消費者群體進入我們的市場。我們繼續看到這一點。

And our next question comes from John Rowan from Janney Montgomery Scott.

我們的下一個問題來自詹尼·蒙哥馬利·斯科特的約翰·羅文。

Congrats Jeff and Doug. I guess some other larger lenders have postulated that with the potential for our strike, and you guys mentioned this in your prepared remarks a little bit, that there would be an increase in dealer inventory, guys would take up floor plan loans. Obviously, fiscal 2023 midyear, you were very heavy in inventory.

恭喜傑夫和道格。我想其他一些較大的貸方已經假設，由於我們有可能罷工，你們在準備好的發言中提到了這一點，經銷商庫存將會增加，人們會接受平面圖貸款。顯然，2023 財年年中，庫存非常重。

Are you planning on raising inventory levels at all if this strike looks like it's going in one direction? And I'm not sure really -- obviously, everything flows downstream. I don't necessarily think there's necessarily an immediate shortage in used cars, but just curious if you think there'll be a ripple effect that could cause you to raise inventory levels?

如果這次罷工看起來朝一個方向發展，您是否計劃提高庫存水準？我真的不確定——顯然，一切都流向下游。我不一定認為二手車一定會立即短缺，但只是好奇您是否認為會產生連鎖反應，導致您提高庫存水準？

I don't -- so I think about it differently. It's a great question and certainly been on our minds. I don't know sort of which way it's going, but we're sort of trying to prepare ourselves for any variation of an outcome. I think ultimately, if you go back to the last strike on record, I think it was the GM strike, and you go track overall used car prices, which you saw was upward pressure, especially on those brands.

我不——所以我有不同的想法。這是一個很好的問題，我們也一直在考慮這個問題。我不知道事情會怎樣發展，但我們正在努力為結果的任何變化做好準備。我認為最終，如果你回顧一下有史以來的最後一次罷工，我認為那是通用汽車的罷工，你會追蹤整體二手車價格，你會發現這是上漲的壓力，尤其是對這些品牌而言。

I think it was a General Motor strike. If you go back and look at those brands, you saw a nice increase in pop and pricing is days supply diminished on the ground. It almost happened in real time because there's a lot of speculation in and around that. And so when you have 3 automakers, right, potentially going on strike and the deadline is looming here, you have to sort of be ready for that, and it's going to be more than just the overall impact on those 3 automakers. It will just be a shortage of supply on the ground.

我認為這是通用汽車的罷工。如果你回頭看看這些品牌，你會發現流行度有了很大的成長，而價格卻隨著供應量的減少而增加。這幾乎是實時發生的，因為對此有很多猜測。因此，當你有 3 個汽車製造商時，對吧，可能會舉行罷工，而且最後期限即將到來，你必須為此做好準備，這將不僅僅是對這 3 個汽車製造商的總體影響。這只是當地的供應短缺。

If you looked at absolute supply in our industry, it's still really at sort of all-time lows. And so the instance of something like this happening could drive values up. And so for us, that is some headwind on the buying side. We can combat that with being more selective on the cars we buy. But to your point, I think what you're alluding to is, do we stock up for an event like that?

如果你看看我們行業的絕對供應量，你會發現它仍然處於歷史最低水平。因此，發生這樣的事情可能會推高價值。因此，對我們來說，這對購買方來說是一些阻力。我們可以透過對購買的汽車更有選擇性來應對這個問題。但就你的觀點而言，我認為你所指的是，我們是否為這樣的活動儲備了物資？

I don't think that is necessarily a lever we would pull. However, I do think if there was some appreciation in value, it becomes a tailwind on the fair market values that we have for the cars that were taken back, the repo vehicles. So there's good and bad to us being having the lending side to this, and -- we're just trying to make sure we're ready. We don't know sort of which way it's going to go, but our job is to be ready for that, and we're looking at those options available to us now.

我認為這不一定是我們會拉動的槓桿。然而，我確實認為，如果價值有所升值，它將成為我們被收回的汽車（即回購車輛）的公平市場價值的順風車。因此，擁有貸款方對我們有好處也有壞處，而且——我們只是想確保我們已經準備好了。我們不知道事情會朝哪個方向發展，但我們的工作是為此做好準備，我們現在正在研究可供我們選擇的選項。

We mentioned on the last call, too, that a lot of competition that we have is struggling with capital. We had a couple of sizable competitors go out of business in the last 6 months or so, too. So there's some positive on the supply side in addition to some potential negatives too. So that all balances out. And we're pretty nimble on our procurement. So we'll be able to address and adjust any situation we see.

我們在上次電話會議中也提到，我們的許多競爭對手都在與資本作鬥爭。在過去六個月左右的時間裡，我們也有一些規模較大的競爭對手倒閉了。因此，除了一些潛在的負面影響之外，供應方面也有一些正面的一面。這樣一切就平衡了。我們的採購非常靈活。因此，我們將能夠解決和調整我們看到的任何情況。

(Operator Instructions) And our next question comes from Vincent Caintic from Stephens.

（操作員說明）我們的下一個問題來自 Stephens 的 Vincent Caintic。

Doug, congratulations and look forward to working with you and, Jeff, it's been a pleasure working with you for the past several years, and we'll miss you. So first one to zoom out just kind of a broad question about the CEO transition. And if you could walk us through that. It sounds like this process has been going on for the past few years. So I just wanted to kind of get a sense for why now is a good time for the transition and then Doug, anything in particular you'd like to focus on as we start your tenure?

道格，恭喜並期待與您合作，傑夫，過去幾年與您合作很愉快，我們會想念您的。因此，第一個要縮小有關執行長過渡的廣泛問題。如果您能引導我們完成這一點。聽起來這個過程在過去幾年一直持續著。所以我只是想了解為什麼現在是過渡的好時機，然後道格，在我們開始你的任期時，你有什麼特別想要關注的事情嗎？

Well, yes, as to the timing, this is just a good time in our history. We've -- we've been through some pretty difficult times. Things are still tough, but getting a little bit better in some of these long-term, highly complex, labor-intensive investments and initiatives we've had in place, Doug has been able to participate in those for the last year.

嗯，是的，至於時機，這只是我們歷史上的一個美好時光。我們已經度過了一些相當困難的時期。事情仍然很艱難，但在我們已經實施的一些長期、高度複雜、勞動密集型投資和舉措中取得了一些進展，道格去年已經能夠參與其中。

And those are all coming into play and with Doug and his experience and his talent level, it's just -- it's a perfect time for us as a company, especially with the transition being extended. There will be plenty of support, plenty of time to transition appropriately as we go forward. So this is just a good time for me, for Doug and for our company and our associates and shareholders. It's a good time in history to be making this change, especially with the transition plan we have in place. So, Doug?

這些都在發揮作用，憑藉道格、他的經驗和才華水平，這對我們公司來說是一個完美的時機，特別是隨著過渡的延長。隨著我們的前進，將會有充足的支持和充足的時間進行適當的過渡。因此，這對我、道格、我們的公司、我們的員工和股東來說都是一個美好的時光。現在是做出這項改變的歷史好時機，特別是在我們制定了過渡計畫的情況下。那麼，道格？

My first, obviously, opportunity to be a CEO of the company, and again, I'm humbled, but at the end of the day, there are a lot of associates who are relying on smooth transition -- shareholders relying on a smooth transition. And the more we thought about it, the longer Jeff stayed on to help assist with the transition for the things they don't know and especially on the credit side of the business, Vincent, that it sort of made more sense to accelerate making the announcement and then having Jeff stand up for a longer period of time as opposed to postponing it and doing the transition to a shorter period of time.

顯然，這是我第一次有機會成為公司的首席執行官，我再次感到謙卑，但最終，有很多同事依賴平穩過渡——股東依賴平穩過渡。我們想得越多，傑夫留下的時間就越長，幫助他們完成他們不知道的事情的過渡，特別是在業務的信貸方面，文森特，加速使公告，然後讓傑夫站更長的時間，而不是推遲公告並過渡到較短的時間。

And I think leading to your question, I'll probably spend more time on the credit side of the business, the underwriting side of the business and see what improvements that we have there, especially given credit loss. And when I think about some of the improvements we made in other areas of the business, I'm excited to sort of roll up my sleeves and see what other opportunities are there as well.

我認為，在提出你的問題時，我可能會花更多的時間在業務的信貸方面、業務的承保方面，看看我們在這方面有哪些改進，特別是考慮到信用損失。當我想到我們在業務其他領域所做的一些改進時，我很高興能捲起袖子，看看還有哪些其他機會。

Okay. Great. That's super helpful. My next question, I wanted to touch on the shelf filing that was filed a couple of weeks ago and in some of the comments that were made in the shelf filing, particularly the kind of the unprecedented opportunities you might be seeing, if you could talk about that in more detail. What you're seeing and sort of what you're looking for that makes you excited about those opportunities?

好的。偉大的。這非常有幫助。我的下一個問題，我想談談幾週前提交的擱置文件以及擱置文件中提出的一些評論，特別是您可能會看到的前所未有的機會，如果您能談談更詳細地介紹這一點。您所看到的以及正在尋找的是什麼讓您對這些機會感到興奮？

Yes. The industry, obviously, has been in turmoil. We've had major competitors going out of business. There's a lot of folks that have been in the business for decades that don't have an exit strategy, don't have a succession plan, the cost of being in the business continues to go up.

是的。顯然，這個行業一直處於混亂之中。我們的主要競爭對手已經倒閉。有很多人在這個行業工作了幾十年，但沒有退出策略，沒有繼任計劃，進入這個行業的成本持續上升。

So there's a lot of very good, very strong operators out there of size that are looking for a succession plan or how to get out of the business. And so what we do and what we've offered on the acquisition side is appealing to more and more good operators, and we've got some good discussions going on.

因此，有許多非常優秀、非常強大的規模經營者正在尋找繼任計畫或如何退出該業務。因此，我們在收購方面所做的和提供的服務吸引了越來越多的優秀營運商，並且我們正在進行一些很好的討論。

Very optimistic about being able to continue to pick up productivity and profits from our existing store base and then add this acquisition's effort on separate and apart from all the other good stuff going on, and it could be really a good point, a great point in history for us to be going out and getting more aggressive with acquisitions and we're setting ourselves up to do just that.

我們對能夠繼續從我們現有的商店基礎中提高生產力和利潤感到非常樂觀，然後將這次收購的努力與所有其他正在進行的好事分開，這可能真的是一個好點，一個偉大的點我們已經走出去並更加積極地進行收購，我們正在為此做好準備。

And the shelf registration was just another aspect to that opportunity and giving us more options on the financing side, if and when needed, to support some acquisitions.

貨架註冊只是這個機會的另一個方面，它為我們在融資方面提供了更多選擇，如果需要的話，可以支持一些收購。

Okay. Great. And if I could maybe sneak one more in for Vickie. Just on the credit side. Now the credit reserves have been increasing and understandably about the mix and the term and so forth. Just as the way things stand right now, do you foresee that the credit reserves where we're at, is that sort of the right level? Or should we be anticipating just enough term and mix things continue to change?

好的。偉大的。如果我可以再為維琪偷偷帶一張。只是在信用方面。現在，信貸儲備一直在增加，而且在組合和期限等方面也是可以理解的。就像目前的情況一樣，您是否預見到我們目前的信貸儲備水準是否合適？或者我們應該預期足夠的期限並混合事物繼續變化？

Sure. Well, we continue to look at that quarterly based on historical numbers and what's happening in the current market as well as some forecasting for some economic events. So we did increase it slightly in the fourth quarter.

當然。好吧，我們繼續根據歷史數據和當前市場發生的情況以及對一些經濟事件的預測來查看該季度的數據。所以我們在第四季確實略有增加。

We were able to keep it level this quarter. So it's hard to say quarter-over-quarter, but we're working on a lot of things. As we mentioned in the press release and in a few of my comments in bringing down term, working on down payments, hopefully reducing some selling price (inaudible) finance as we move forward.

本季我們能夠保持水平。所以很難說季度環比，但我們正在做很多事情。正如我們在新聞稿中以及我在縮短期限、處理首付款方面的一些評論中提到的，希望在我們前進的過程中降低一些銷售價格（聽不清楚）融資。

So those will all be things that we're working on to hopefully offset the impact of any allowance increases. But that's certainly a possibility as we move forward here and depending on what happens over the next few quarters.

因此，這些都是我們正在努力的事情，希望能夠抵銷任何津貼增加的影響。但這肯定是有可能的，因為我們在這裡向前邁進，並取決於接下來幾季發生的情況。

I am showing no further questions. I would now like to turn the call back over to Jeff Williams for closing remarks.

我沒有提出任何進一步的問題。我現在想將電話轉回傑夫威廉斯（Jeff Williams）發表結束語。

Okay. Well, once again, thank you for listening to our call, and thank you for your interest in America's Car-Mart. Doug, congratulations again on your promotion to CEO. We'll have a smooth transition and we appreciate and respect all of our associates out there that have passion for what we do and support each other and support our customers at a very high level. So thank you, and have a great day.

好的。好的，再次感謝您收聽我們的電話，也感謝您對美國汽車超市的關注。道格，再次恭喜您晉升為執行長。我們將實現平穩過渡，我們感謝並尊重所有對我們的工作充滿熱情、相互支持並為我們的客戶提供高水準支持的員工。謝謝你，祝你有美好的一天。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。