Regional Management Corp (RM) 2025 Q3 法說會逐字稿

Good afternoon, ladies and gentlemen, and welcome to the Regional Management third-quarter 2025 earnings call. (Operator Instructions) Please note that this event is being recorded.

女士們、先生們，下午好，歡迎參加區域管理部門 2025 年第三季財報電話會議。（操作說明）請注意，本次活動正在錄影。

I will now hand it over to Garrett Edson of ICR. Please go ahead.

現在我將把這個任務交給ICR的加勒特·埃德森。請繼續。

Thank you, and good afternoon. By now, everyone should have access to our earnings announcement and supplemental presentation, which were released prior to this call and may be found on our website at regionalmanagement.com. Before we begin our formal remarks, I will direct you to page 2 of our supplemental presentation, which contains important disclosures concerning forward-looking statements and the use of non-GAAP financial measures. Part of our discussion today may include forward-looking statements, which are based on management's current expectations, estimates, and projections about the company's future financial performance and business prospects.

謝謝，下午好。現在，所有人都應該可以查閱我們的獲利公告和補充演示文稿，這些文件在本次電話會議之前發布，可以在我們的網站 regionalmanagement.com 上找到。在我們正式發言之前，請各位參閱補充簡報的第 2 頁，其中包含前瞻性陳述和非公認會計準則財務指標使用的重要揭露資訊。我們今天的部分討論可能包含前瞻性陳述，這些陳述是基於管理層對公司未來財務表現和業務前景的當前預期、估計和預測。

These forward-looking statements speak only as of today and are subject to various assumptions, risks, uncertainties, and other factors that are difficult to predict, and that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. These statements are not guarantees of future performance and therefore, you should not place undue reliance upon them. We refer all of you to our press release presentation and recent filings with the SEC for a more detailed discussion of our forward-looking statements and the risks and uncertainties that could impact our future operating results and financial condition.

這些前瞻性陳述僅代表截至今日的觀點，並受各種假設、風險、不確定性和其他難以預測的因素的影響，這些因素可能導致實際結果與前瞻性陳述中明示或暗示的結果有重大差異。這些聲明並非對未來業績的保證，因此，您不應過度依賴這些聲明。有關我們的前瞻性聲明以及可能影響我們未來經營業績和財務狀況的風險和不確定性的更詳細討論，請參閱我們的新聞稿和最近向美國證券交易委員會提交的文件。

Also, our discussions today may include references to certain non-GAAP measures. The reconciliation of these measures to the most comparable GAAP measures can be found within our earnings announcement or earnings presentation and posted on our website at regionalmanagement.com.

此外，我們今天的討論可能還會提及某些非GAAP指標。這些措施與最可比較的 GAAP 措施的調節情況，可以在我們的獲利公告或獲利簡報中找到，也可以在我們的網站 regionalmanagement.com 上找到。

I would now like to introduce Rob Beck, President and CEO of Regional Management Corp.

現在我謹向大家介紹區域管理公司總裁兼執行長羅伯貝克。

Thanks, Garrett, and welcome to our third-quarter 2025 earnings call. I'm joined today by Harp Rana, our Chief Financial and Administrative Officer. On this call, we'll cover our third-quarter results, provide an update on our portfolio growth strategies and credit performance, and share our expectations for the remainder of the year. As you may have noticed, we also announced my pending retirement today. I'll provide a few words on that towards the end of the call.

謝謝加勒特，歡迎參加我們2025年第三季財報電話會議。今天和我一起的是我們的財務兼行政官哈普·拉納。在本次電話會議上，我們將介紹我們第三季的業績，更新我們的投資組合成長策略和信貸表現，並分享我們對今年剩餘時間的預期。正如您可能已經注意到的，我們今天也宣布了我即將退休的消息。我會在通話快結束時就此簡單談幾句。

Building off last quarter's strong numbers and momentum, we again posted excellent financial and operating results in the third quarter. We delivered net income of $14.4 million and diluted earnings per share of $1.42, an improvement of 87% year over year. We grew our portfolio by $93 million sequentially, pushing our ending net receivables past $2 billion in the quarter, a new milestone for Regional. Our portfolio generated $165 million of total revenue, a record high. While our operating expense ratio dipped to 12.8%, also an all-time best.

延續上一季強勁的業績和勢頭，我們在第三季度再次取得了優異的財務和營運業績。我們實現了1,440萬美元的淨收入，稀釋後每股收益為1.42美元，年增87%。我們的投資組合季增了 9,300 萬美元，使本季末淨應收帳款超過 20 億美元，這是 Regional 的一個新里程碑。我們的投資組合創造了 1.65 億美元的總收入，創歷史新高。我們的營運費用率降至 12.8%，這也是歷史最佳水準。

The team continues to manage all line items of the income statement and balance sheet very well as we focus on driving growth, improving our operating effectiveness, and generating capital that we can reinvest in our expansion and return to our shareholders through dividends and stock repurchases. We continue to monitor economic conditions and believe consumers in our target segment remain healthy.

團隊繼續很好地管理損益表和資產負債表的各個項目，我們專注於推動成長、提高營運效率，並創造資本，以便我們能夠將資金再投資於擴張，並透過股息和股票回購回報給股東。我們將繼續關注經濟狀況，並相信我們目標客戶群的消費者仍然保持健康。

Stable consumer health and expanded geographic presence and our improved data analytic capabilities have enabled us to responsibly grow our portfolio while at the same time improving our credit performance. Our total originations in the third quarter reached another record high, up 23% from the prior-year period. Year over year, our portfolio grew by $233 million or 13%, keeping us on track to meet our targeted portfolio growth rate of at least 10% in 2025.

穩定的消費者健康狀況、不斷擴大的地域覆蓋範圍以及我們不斷提升的數據分析能力，使我們能夠在負責任地擴大投資組合的同時，提高信貸表現。第三季度，我們的貸款發放總量再創新高，比去年同期成長了 23%。與前一年相比，我們的投資組合成長了 2.33 億美元，增幅達 13%，使我們預計在 2025 年實現至少 10% 的投資組合成長率目標。

Notably, we exceeded our receivable growth expectations by roughly $35 million in the quarter as we took advantage of strong demand for our auto-secured product and a larger addressable market from new branch growth while maintaining a tight credit box. The additional $35 million of growth required us to recognize incremental provision expense in the quarter of approximately $3.6 million or $2.7 million after tax. Despite the additional provision expense, our net income was roughly in line with our guidance, thanks to effective management of all our other line items.

值得注意的是，由於我們利用了市場對我們汽車擔保產品的強勁需求以及新分支機構增長帶來的更大潛在市場，同時保持了嚴格的信貸控制，我們本季度的應收賬款增長超出了預期約 3500 萬美元。新增的 3,500 萬美元成長需要我們在本季確認約 360 萬美元的額外撥備支出，稅後約 270 萬美元。儘管增加了撥備支出，但由於對其他所有項目進行了有效管理，我們的淨收入基本上符合預期。

We also continue to experience improvements in our portfolio credit quality and performance, thanks to our credit-tightening actions and returns on our data and analytic investments. At quarter end, our 30-plus day delinquency rate was 7%, an increase of 10 basis points year over year, but a 30 basis point improvement after adjusting to the impact in the prior year of special borrower assistance programs associated with hurricane activity. Our net credit loss rate of 7.2% improved 170 basis points sequentially and 40 basis points year over year, due to credit tightening, affected portfolio management, and product mix.

由於我們採取了信貸緊縮措施，並且數據和分析投資獲得了回報，我們的投資組合信貸品質和績效也持續改善。截至季末，我們的逾期 30 天以上的貸款率為 7%，比上年同期增長了 10 個基點，但在調整了上一年與颶風活動相關的特殊借款人援助計劃的影響後，改善了 30 個基點。由於信貸緊縮、投資組合管理和產品組合調整，我們的淨信貸損失率為 7.2%，較上季改善 170 個基點，較去年同期改善 40 個基點。

We're observing particularly strong credit performance in our newer [branches] and in our portfolio loans with an APR of 36% or less, including our auto-secured portfolio. For our portfolio loans with APRs capped at 36%, our 30-plus-day delinquency rate was 6.2%, and our NCL rate was 8.9% in the third quarter, a 60 basis points improvement year over year and 130 basis points improvement from the third quarter of 2023.

我們觀察到，在較新的[分行]和年利率為 36% 或以下的投資組合貸款（包括我們的汽車擔保投資組合）中，信貸表現尤為強勁。對於年利率上限為 36% 的投資組合貸款，第三季逾期 30 天以上的貸款率為 6.2%，不良貸款率為 8.9%，年減 60 個基點，較 2023 年第三季下降 130 個基點。

We also continue to closely manage expenses in the quarter. Our operating expense ratio of 12.8% improved 110 basis points year over year, despite continued investment in innovation and growth, including 16 new branches open since the third quarter of last year. Our year-over-year total revenue growth outpaced our G&A expense growth by 12 times. We'll continue to invest in initiatives that will drive long-term returns while practicing sound expense discipline.

本季我們也將持續嚴格控制各項支出。儘管我們持續投資於創新和成長，包括自去年第三季以來開設了 16 家新分行，但我們的營運費用率仍為 12.8%，年減了 110 個基點。我們的年度總收入成長速度比一般及行政費用成長速度高出 12 倍。我們將繼續投資於能夠帶來長期回報的項目，同時保持合理的支出紀律。

In the third quarter, we had capital generation of $26 million, bringing total capital generation year to date to $53 million. Through the third quarter of this year, we returned an aggregate of $26 million in capital to shareholders via stock repurchases of $17 million and dividends of $9 million. Our book value per share reached $37.94 at quarter end.

第三季度，我們獲得了 2,600 萬美元的資本，使今年迄今的總資本收入達到 5,300 萬美元。今年第三季度，我們透過股票回購1,700萬美元和股利900萬美元，向股東返還了總計2,600萬美元的資本。截至季末，我們的每股帳面價值達到 37.94 美元。

In sum, we're very pleased with our third-quarter results, and I continue to be impressed with our team's execution. We have very positive momentum and a growing, healthy portfolio, and we remain well-positioned to deliver strong results. Looking ahead, we'll continue to execute on our growth strategies and improving our operating effectiveness.

總而言之，我們對第三季的業績非常滿意，我對我們團隊的執行力也印象深刻。我們擁有非常積極的發展勢頭和不斷增長的健康投資組合，我們仍然處於有利地位，能夠取得強勁的業績。展望未來，我們將繼續執行成長策略，並提高營運效率。

We expect to open five new branches before year end in Louisiana and California, and another 5 to 10 new branches in the first half of 2026. We also plan to enter one to two new states in 2026. Our new branches are performing well, growing rapidly and generating positive monthly net income at around month 14 and positive pre-provision net income at around month 3. We continue to view new branch openings as excellent investments, and will continue to open new branches in new and existing markets with the pace of openings dependent on economic conditions.

我們預計在年底前在路易斯安那州和加州開設五家新分店，並在 2026 年上半年再開設 5 至 10 家新分店。我們也計劃在 2026 年進入一到兩個新的州。我們新開的分行業績良好，發展迅速，在大約第 14 個月實現了正的月淨收入，在大約第 3 個月實現了正的撥備前淨收入。我們仍然認為開設新分行是極好的投資，並將繼續在新市場和現有市場開設新分行，開設速度取決於經濟狀況。

Our [broader] strategy of growth in our higher-quality, auto-secured, and higher-margin small loan portfolios also continues to be very effective. Growth in our auto-secured portfolio in particular is outpacing the growth of our broader portfolio. Auto-secured loans grew by $80 million, or 41% year over year, to 13.4% of the portfolio at quarter-end. Our auto-secured book has very strong margins and the best credit performance of any segment of our portfolio, with a 30-plus day delinquency rate of only 1.8%. Meanwhile, growth of our higher-margin small loan portfolios support our returns and customer graduation strategy.

我們[更廣泛的]成長策略，即提高高品質、汽車擔保和高利潤的小額貸款組合，也持續取得非常顯著的成效。尤其值得一提的是，我們汽車抵押貸款組合的成長速度超過了我們整體投資組合的成長速度。截至季末，汽車抵押貸款年增 8,000 萬美元，增幅達 41%，佔貸款組合的 13.4%。我們的汽車擔保貸款帳簿利潤率非常高，是我們所有投資組合中信用表現最好的，逾期 30 天以上的貸款率僅為 1.8%。同時，我們利潤率較高的小額貸款組合的成長支撐了我們的回報和客戶升級策略。

On the expense front, we remain good stewards of shareholder capital while investing in ways that will improve our operating efficiency and credit performance. We continue to implement improvements in technology and advanced data and analytics such as our new front-end branch origination platform, customer lifetime value analytic framework for direct mail marketing, and machine learning branch underwriting model.

在支出方面，我們始終善待股東資本，同時投資於能夠提高營運效率和信貸表現的方式。我們不斷改進技術和先進的數據與分析，例如我們新的前端分支機構發起平台、用於直郵行銷的客戶生命週期價值分析框架以及機器學習分支機構承保模型。

Ultimately, these investments will improve our customer experience and team member efficiency, allow us to make better credit and marketing decisions, enhance our ability to monitor results, and enable us to optimize profitably. We expect that our team's efforts to grow our portfolio, increase our operational efficiency, and improve our credit performance will drive increases in net income and shareholder value over time.

最終，這些投資將改善我們的客戶體驗和團隊成員效率，使我們能夠做出更好的信貸和行銷決策，增強我們監控結果的能力，並使我們能夠實現盈利性優化。我們期望團隊在擴大投資組合、提高營運效率和改善信貸表現方面的努力，能夠隨著時間的推移，推動淨收入和股東價值的成長。

For 2025, we're now forecasting full-year net income of $43.5 million, the midpoint of our prior guide of $42 million to $45 million. Where we land will be driven by macroeconomic conditions-and our fourth quarter portfolio growth, which directly impacts our provisioning for credit losses and bottom-line results. Ultimately, our portfolio growth rate in the fourth quarter will depend on the health of the consumers informed by our credit metrics and macroeconomic conditions, including the status of the government shutdown.

我們現在預測 2025 年全年淨收入為 4,350 萬美元，這是我們先前預測的 4,200 萬美元至 4,500 萬美元的中點。我們的最終投資方向將取決於宏觀經濟狀況以及我們第四季的投資組合成長情況，這將直接影響我們的信貸損失撥備和最終業績。最終，我們第四季的投資組合成長率將取決於消費者的健康狀況，而消費者的健康狀況又取決於我們的信用指標和宏觀經濟狀況，包括政府停擺的情況。

Finally, our Board of Directors approved an increase in our stock repurchase program from $30 million to $60 million, of which $36 million remained available as of the end of October. We have a very healthy balance sheet with significant funding for continued execution of our long-term growth strategy and the return of excess capital to shareholders. The larger authorization will enable us to continue to be opportunistic in repurchasing our common stock as we grow our business.

最後，我們的董事會批准將股票回購計畫從 3,000 萬美元增加到 6,000 萬美元，截至 10 月底，其中仍有 3,600 萬美元可用。我們擁有非常健康的資產負債表，為持續執行長期成長策略和向股東返還超額資本提供了充足的資金。更大的授權將使我們能夠在業務成長的過程中繼續抓住機會回購我們的普通股。

I'll now turn the call over to Harp, who will provide more detail on our results.

現在我將把電話交給哈普，他將詳細介紹我們的結果。

Thank you, Rob, and hello, everyone. I'll now take you through our third-quarter results in more detail and provide you with an outlook for the fourth quarter. On page 4 of the supplemental presentation, we provide our third-quarter financial highlights, demonstrating significant improvements across key financial metrics.

謝謝你，羅布，大家好。接下來，我將更詳細地向大家介紹我們第三季的業績，並展望第四季的業績。在補充簡報的第 4 頁，我們提供了第三季的財務亮點，展示了關鍵財務指標的顯著改善。

Our net income of $14.4 million and diluted EPS of $1.42 were once again supported by solid portfolio revenue growth, a healthy credit profile, expense discipline, and a strong balance sheet. For the fourth quarter, we're projecting net income of roughly $12 million.

我們的淨收入 1,440 萬美元和稀釋後每股收益 1.42 美元再次得益於穩健的投資組合收入成長、健康的信貸狀況、費用控制和強勁的資產負債表。我們預計第四季淨收入約為 1200 萬美元。

Turning to pages 5 and 6, we had record originations of $522 million in the third quarter, up 23% year over year. Loan volume was driven by continued strong performance from our digital channel, auto-secured products, and the 16 de novo branches we've opened over the past 12 months. Our total portfolio crossed the $2 billion milestone in the quarter and stood at a record $2.1 billion at the end of the third quarter, while our ending net receivables per branch reached $5.9 million on average.

翻到第 5 頁和第 6 頁，我們第三季的貸款發放額創下歷史新高，達到 5.22 億美元，年增 23%。貸款金額的成長得益於我們數位管道、汽車擔保產品以及過去 12 個月內新開設的 16 家分行的持續強勁表現。本季我們的投資組合總額突破了 20 億美元大關，並在第三季末達到創紀錄的 21 億美元，而我們每個分公司的期末淨應收帳款平均達到 590 萬美元。

We continue to believe that economic markers remain solid and that our customers tend to be resilient and adaptable. These conditions, along with the increases in our addressable market through geographic expansion, have allowed us to grow our portfolio while maintaining a tight credit box. Looking ahead to the fourth quarter, we anticipate that our ending net receivables will increase by roughly $60 million to $70 million sequentially, and that our average net receivables will be up by roughly $80 million sequentially.

我們仍然相信經濟指標保持穩健，我們的客戶往往具有很強的適應能力和韌性。這些條件，加上透過地理擴張擴大了我們的潛在市場，使我們能夠在保持嚴格信貸規模的同時，擴大我們的投資組合。展望第四季度，我們預計期末淨應收帳款將較上季增加約 6,000 萬美元至 7,000 萬美元，平均淨應收帳款將較上季增加約 8,000 萬美元。

Turning to page 7. Total revenue grew to a record $165 million in the third quarter, up 13% year over year. Our total revenue yield and interest and fee yield moved up 20 and 30 basis points sequentially to 33.1% and 29.7%, respectively, in line with seasonal patterns. In the fourth quarter, we expect total revenue yield of 32.2%, a 90 basis point sequential decrease due to seasonality and product mix.

翻到第7頁。第三季總營收成長至創紀錄的 1.65 億美元，年增 13%。根據季節性規律，我們的總收入收益率和利息及手續費收益率分別較上月上升 20 和 30 個基點，達到 33.1% 和 29.7%。第四季度，我們預計總收入收益率為 32.2%，由於季節性因素和產品組合變化，將比去年同期下降 90 個基點。

Moving to page 8. Our portfolio continues to perform well. Our 30-plus day delinquency rate as of quarter end was 7%, a 30 basis point improvement year over year after adjusting for the prior year hurricane impact. Our third-quarter net credit loss rate of 10.2% improved 170 basis points sequentially and 40 basis points year over year due to credit tightening, effective portfolio management, and product mix.

翻到第8頁。我們的投資組合持續表現良好。截至季末，我們的逾期 30 天以上的欠款率為 7%，在調整了去年颶風的影響後，比去年同期改善了 30 個基點。由於信貸緊縮、有效的投資組合管理和產品組合，我們第三季的淨信貸損失率為 10.2%，季增 170 個基點，較去年同期改善 40 個基點。

In the fourth quarter, we expect our delinquency rate to rise gradually, consistent with seasonal patterns. We anticipate that our net credit losses will be approximately $57 million in the fourth quarter. The NCL rate will be sequentially higher due to seasonality, and it will be roughly in line to the fourth quarter of last year.

預計第四季我們的違約率將逐步上升，這與季節性規律相符。我們預計第四季淨信貸損失約為 5700 萬美元。由於季節性因素，NCL費率將逐季上漲，大致與去年第四季持平。

Turning to page 9. We increased our allowance for credit losses in the quarter by $9.2 million to support portfolio growth. Consistent with our outlook, our allowance for credit losses rate remained steady at 10.3%. Looking to the fourth quarter, subject to economic conditions and portfolio performance, we expect our reserve rate to remain at 10.3%.

翻到第9頁。為了支持投資組合成長，我們本季增加了 920 萬美元的信貸損失準備金。與我們的預期一致，我們的信用損失準備率維持在 10.3% 不變。展望第四季度，根據經濟狀況和投資組合表現，我們預期我們的準備率將維持在 10.3%。

Flipping to page 10. We continue to closely manage our spending while still investing in our growth capabilities, and strategic initiatives. Our annualized operating expense ratio was 12.8% in the third quarter, another all-time best and an improvement of 110 basis points from the prior-year period. In the third quarter, our revenue growth outpaced our G&A expense growth by 12 times. In the fourth quarter, we expect G&A expenses to be roughly $65 million.

翻到第10頁。我們將繼續嚴格控制支出，同時繼續投資於我們的成長能力和策略性舉措。第三季度，我們的年化營運費用率為 12.8%，再次創歷史新高，比去年同期改善了 110 個基點。第三季度，我們的營收成長速度比一般及行政費用成長速度高出 12 倍。我們預計第四季一般及行政費用約為 6500 萬美元。

Turning to pages 11 and 12. Our interest expense for the third quarter was $22 million, or 4.4% of average net receivables on an annualized basis. Our cost of funds increased year over year as lower fixed rate debt has matured and we funded our growth with higher fixed and variable rate debt. Even with the increased cost of funds, we're pleased with the way that we've managed our interest expense over the past few years.

翻到第11頁和第12頁。第三季利息支出為 2,200 萬美元，佔年化平均淨應收帳款的 4.4%。由於低利率固定債務到期，我們透過高利率固定和浮動利率債務為成長提供資金，因此我們的資金成本逐年增加。即使資金成本增加，我們對過去幾年利息支出的管理方式感到滿意。

As of the end of the third quarter, 76% of our debt was fixed rate with a weighted average coupon of 4.6%. In October, we closed a $253 million asset-backed securitization transaction at a weighted average coupon of 4.8%, a 50 basis point improvement from our deal earlier this year. This transaction once again demonstrates the strength of our ABS platform. Following the closing of the October securitization, fixed-rate debt represented 89% of total debt, with a weighted average coupon of 4.7% and a weighted average revolving duration of 1.2 years.

截至第三季末，我們76%的負債為固定利率，加權平均票面利率為4.6%。10 月份，我們完成了一筆 2.53 億美元的資產支持證券化交易，加權平均票息為 4.8%，比今年稍早的交易提高了 50 個基點。此次交易再次證明了我們ABS平台的實力。10 月證券化完成後，固定利率債務佔總債務的 89%，加權平均票面利率為 4.7%，加權平均循環期限為 1.2 年。

In the fourth quarter, we expect interest expense to be approximately $23 million, or 4.4% of average net receivables. Moving forward, we'll continue to maintain a strong balance sheet with ample liquidity and borrowing capacity, diversified and staggered funding sources, and a sensible interest rate management strategy.

預計第四季利息支出約 2,300 萬美元，佔平均淨應收款的 4.4%。展望未來，我們將繼續維持穩健的資產負債表，擁有充足的流動性和借貸能力，多元化和分階段的融資來源，以及合理的利率管理策略。

Aside from investing in our growth and strategic initiatives, we continue to allocate excess capital to our dividend and share repurchase programs. Our Board of Directors declared a dividend of $0.30 per common share for the fourth quarter, and pursuant to our buyback program, we repurchased approximately 154,000 shares of our common stock in the third quarter at a weighted average price of $32.56 per share. Finally, I'll note that we provide a summary of our fourth-quarter 2025 guidance on page 14 of our earnings supplement.

除了投資我們的成長和策略性舉措外，我們還將繼續將多餘的資金分配給我們的股息和股票回購計畫。我們的董事會宣布第四季度每股普通股派發 0.30 美元的股息，根據我們的股票回購計劃，我們在第三季以每股 32.56 美元的加權平均價格回購了約 154,000 股普通股。最後，我要指出，我們在收益補充報告第 14 頁提供了 2025 年第四季業績指引的摘要。

That concludes my remarks. I'll now turn the call back over to Rob.

我的發言到此結束。現在我將把通話轉回給羅布。

Thanks, Harp. In summary, we're proud of our third-quarter results. Our team executed very well, delivering strong net income, a new milestone in ending net receivables, and an all-time best on our originations, revenue, and operating expense ratio lines. We continue to grow the company responsibly while increasing shareholder value.

謝謝，哈普。總而言之，我們對第三季的業績感到自豪。我們的團隊表現出色，實現了強勁的淨收入，期末淨應收款達到了新的里程碑，並且在貸款發放量、收入和營運費用率方面都創下了歷史新高。我們將繼續以負責任的方式發展公司，同時提升股東價值。

Before I close things out, I'll say a few words about my retirement. After careful consideration, I decided now is the right time to retire and spend more time with my family. Following a diligent search, our Board of Directors identified Lakhbir Lamba to succeed me as President and Chief Executive Officer of Regional.

在結束之前，我想簡單談談我的退休計劃。經過慎重考慮，我決定現在是退休並多花時間陪伴家人的最佳時機。經過認真遴選，我們的董事會認定 Lakhbir Lamba 將接替我擔任 Regional 的總裁兼執行長。

Lakhbir brings to Regional nearly 30 years of leadership experience in consumer lending and financial services with extensive expertise on consumer credit, digital and technology platform development, brand sales and service, analytics, and product management. We're excited to welcome Lakhbir to Regional as we believe he is the ideal fit to continue our current growth strategy and lead Regional management forward.

Lakhbir 為 Regional 帶來了近 30 年的消費信貸和金融服務領導經驗，在消費信貸、數位和技術平台開發、品牌銷售和服務、分析和產品管理方面擁有豐富的專業知識。我們很高興歡迎 Lakhbir 加入 Regional，因為我們相信他是繼續推進我們當前成長策略並領導 Regional 管理團隊的理想人選。

It's been my distinct pleasure to lead such an outstanding team over the past 5.5 years. I want to thank everyone at Regional for their unwavering commitment and efforts. I'm proud of what we've accomplished as we've navigated through some of the most challenging environments we've experienced in decades, while nearly doubling our net finance receivables and expanding our footprint across the country to eight new states.

在過去的5.5年裡，能夠領導這樣一支傑出的團隊，我感到無比榮幸。我要感謝Regional的每一位成員，感謝他們堅定不移的奉獻和努力。我為我們所取得的成就感到自豪，我們克服了近幾十年來最具挑戰性的環境，同時淨融資應收款幾乎翻了一番，並將業務範圍擴展到全國八個新的州。

Over the same time period, we invested heavily to transform our technology platforms and data analytic capabilities, positioning the business for future growth. With Regional well positioned for its next stage of expansion and my confidence that Lakhbir will lead the team to even greater success, I look forward to beginning my next chapter.

同期，我們投入大量資金改造了我們的技術平台和數據分析能力，為公司未來的發展奠定了基礎。Regional 已做好充分準備迎接下一階段的擴張，我相信 Lakhbir 將帶領團隊取得更大的成功，我期待著開啟我的下一個篇章。

I'll now open up the call for questions. Operator, could you please open the line?

現在開始接受提問。接線生，請您接通線路好嗎？

(Operator Instructions)

（操作說明）

John Hecht, Jefferies.

約翰‧赫克特，傑富瑞集團。

First of all, Rob, congratulations, and hope to keep in touch, and best of luck in your next journey. And, Lakhbir, look forward to working with you as well.

首先，羅布，恭喜你，希望保持聯繫，祝你接下來的旅程一切順利。拉克比爾，我也很期待與你合作。

So my questions are, you had a pretty good acceleration in same-store sale data as your digital volume picks up, too. I'm wondering, at the store level, maybe can you tell us what's going on? Is it increased new customer count? Is it graduating borrowers to larger loans that's driving that? Maybe just a little bit of a breakdown there.

所以我的問題是，隨著你們線上銷售額的成長，你們的同店銷售數據也出現了相當不錯的加速成長。我想問一下，在門市層面，您能否告訴我們具體情況？新客戶數量增加了嗎？是因為借款人逐步獲得更大額的貸款才導致了這種情況嗎？可能出現了一點小故障。

Well, thanks, John. Appreciate the nice words. Yeah, the same-store sales have really increased nicely. We underwrite our digital loans through the branches, and we're seeing really strong momentum coming through digital, as well as, look, our traditional renewal customers come through existing customers, as well as our live check program.

謝謝你，約翰。感謝您的讚美之詞。是的，同店銷售額確實有了顯著成長。我們透過分行承銷數位貸款，我們看到數位業務發展勢頭強勁，此外，我們的傳統續貸客戶來自現有客戶，以及我們的即時支票計劃。

So we're seeing no surprise. We're seeing good demand, and we're able to be choosy on the customers we pick with a tight credit box. So we feel good about where we're at.

所以，我們並不感到驚訝。我們看到市場需求良好，而且由於信用審查嚴格，我們可以對客戶進行精挑細選。所以我們對現狀感到滿意。

And just to add to that, John. So we've had exceptional growth in terms of the auto-secured. The branches are really sort of tracking to auto-secured. Digital volumes are also up. And as you know, those are booked through the branches. So between those two items, you're seeing strong performance in our branches year over year.

約翰，我還要補充一點。因此，我們在汽車擔保方面取得了非凡的成長。這些分支機構實際上正在逐步實現自動安全化。數位銷量也有所上升。如您所知，這些都是透過分行預訂的。因此，從這兩個方面來看，我們的分公司的業績逐年強勁成長。

Okay. And then I guess anything to think about as we transition toward '26 in terms of focusing on a product mix? Are we thinking similar mix this year to next year? Or is there something that would be guiding a change?

好的。那麼，在向 2026 年過渡的過程中，我們在產品組合方面有什麼需要考慮的嗎？我們今年和明年是否打算採用類似的產品組合？或者說，是否存在某種因素在引導這種改變？

So John, how I would think about it is, you know, in terms of our mix, we're always very, very nimble, given the economic environment that we face. We talked about our growth in auto-secured. That is a nascent product for us, so I would expect to see that continue to grow.

約翰，我的看法是，你知道，就我們的投資組合而言，鑑於我們所面臨的經濟環境，我們總是非常非常靈活。我們討論了我們在汽車擔保領域的成長情況。那對我們來說是一個新興產品，所以我預計它會繼續成長。

You can take a look at our mix in terms of our large loans and our small loans. And, you know, we will continue to grow the large loans, particularly driven by auto-secured, but we always remain nimble in terms of our state expansion, new borrowers, and growing small loans in those new states.

您可以查看我們的貸款組合，包括大額貸款和小額貸款。而且，你知道，我們將繼續擴大大額貸款業務，特別是汽車抵押貸款業務，但我們始終保持靈活，不斷拓展業務範圍，增加新的借款人，並在這些新州發展小額貸款業務。

(Operator Instructions)

（操作說明）

Kyle Joseph, Stephens.

凱爾·約瑟夫，史蒂芬斯。

Kind of piggybacking on John's questions. Yeah, I just want to get some color for, obviously, you had really good growth on the large loan side and loan growth slowed on the smaller loans. You talked about the auto loans kind of driving that, but we've heard a lot about the higher-end consumers doing better than the lower-end consumers. Any of that kind of flowing through your origination trends?

算是藉約翰的問題問幾個問題吧。是的，我只是想了解一下情況，很明顯，你們的大額貸款成長非常強勁，而小額貸款的成長則放緩了。你提到汽車貸款在某種程度上推動了這種情況，但我們聽說高端消費者的情況比低端消費者好得多。你們的創作趨勢中是否也有類似的趨勢？

We're not seeing anything in our data just yet, Kyle, but we always continue to look at our data and make adjustments around the margin. In terms of our auto growth, we are definitely booking loans that meet our credit box and meet our risk-return hurdle. So we're feeling pretty good about the growth that we've seen there. So far, we haven't seen anything in our data, but we remain mindful about the uncertainty that folks are feeling.

凱爾，我們目前的數據還沒有顯示任何異常，但我們會持續關注數據，並根據情況進行調整。就我們的汽車業務成長而言，我們肯定會發放符合我們信貸標準和風險回報門檻的貸款。所以，我們對目前所取得的成長感到非常滿意。到目前為止，我們的數據中還沒有發現任何異常，但我們仍然關注著人們所感受到的不確定性。

We know that there's still over 7 million jobs open to customers in our segment. We also know that although inflation is high, it is where it was expected to be. And we know that our customers are resilient. So we continue to look at the uncertainty and make sure that we're making decisions based upon that. But right now, we're not seeing anything in our data that we can't control for by just making some changes around the margin.

我們知道，在我們所在的領域，仍有超過 700 萬個工作職缺。我們也知道，雖然通貨膨脹率很高，但符合預期。我們知道我們的客戶具有很強的適應能力。因此，我們會繼續關注這些不確定因素，並確保我們所做的決定是基於這些不確定因素的。但就目前而言，我們的數據中沒有任何問題是我們無法透過對邊際因素進行一些調整來控制的。

Got it. And then I think you mentioned this, but in terms of the yield decline, just a function seasonality and loan mix shift. Is that right?

知道了。然後我想你也提到了這一點，但就收益率下降而言，這只是季節性因素和貸款結構變化的結果。是這樣嗎？

That is right. And when you're looking at --. Sorry, go ahead.

沒錯。當你看著——。抱歉，請繼續。

Yeah, I was going to say for the fourth-quarter guidance versus the third-quarter number.

是的，我本來想說的是第四季業績預期與第三季業績的比較。

For the fourth quarter, so you know, you're going to see a seasonal decline. You have to remember that in third quarter last year that we did have the hurricane impact, so you've got to normalize for that. But other than that, it is seasonal decline. And then also with the mixed shift to the larger loans, you're going to see yields decline because of that just because the larger loans, although they have a great risk-return margin, you will see lower yields with the larger loans.

第四季度，你會看到季節性下滑。你必須記住，去年第三季我們確實受到了颶風的影響，所以你必須把這一點考慮進去。但除此之外，就是季節性衰退。此外，隨著貸款規模向較大貸款的混合轉變，收益率將會下降，因為雖然較大貸款的風險回報比很高，但其收益率會較低。

Vincent Caintic, BTIG.

Vincent Caintic，BTIG。

And Rob, it's been a pleasure working with you all this time, so congratulations. Well-deserved. So first question on the -- so actually wanting to touch back again on the level of growth and the outperformance versus your third-quarter guidance. So I guess, you know, credit seems to have been okay, so that wasn't the driver.

羅布，這段時間與你共事非常愉快，恭喜你。實至名歸。第一個問題是關於——實際上我想再次談談成長水平以及與您第三季預期相比的超額業績。所以我想，信用狀況似乎沒問題，所以這不是原因。

Just wondering if there was something else, like, was it less competition or something else? Because it was just a, you know, significant and nice beat. So just wondering what you saw in the quarter that surprised you that drove that outperformance.

我只是想知道是不是還有其他原因，像是競爭減少了之類的？因為那隻是一段，你知道的，意義非凡又美妙的節奏。所以，我想知道你在本季看到了哪些讓你感到驚訝並促成業績超預期的表現。

So Vincent, it's Harp. So when we give guidance, right, we were looking out at the same uncertainty that we're looking out at going into the fourth quarter. So we guided based upon what we thought we were going to see. What we found was demand continued to be strong. And then we had to match that demand against our risk box. And as we've talked about in the prepared remarks, our risk box continues to be conservative, right, in terms of it's been tight, haven't really loosened. So we were able to actually meet that demand with our current risk box. We always put on good-quality loans, and we had an opportunity to do that in the third quarter, so that's what we did.

所以文森特，是豎琴。所以，當我們給出業績指引時，我們面臨的不確定性與我們進入第四季時面臨的不確定性是一樣的。所以，我們根據預想中將要看到的景象來安排行程。我們發現市場需求依然強勁。然後，我們必須將這種需求與我們的風險承受能力進行配對。正如我們在準備好的演講稿中提到的，我們的風險控制仍然很保守，對吧？一直都很嚴格，並沒有真正放鬆。因此，我們實際上能夠利用我們現有的風險控制系統來滿足這項需求。我們一直發放優質貸款，第三季我們有機會這樣做，所以我們就這麼做了。

Looking out into fourth quarter in terms of our guidance, again, we're looking at the uncertainty. We want to make sure that we're putting on good loans, and if there is an opportunity to grow faster because we're able to meet demand within our risk box and our return hurdles, we will do so. Keep in mind that if we do grow faster than what we've guided to, that of course will have a CECL impact and it will affect the guidance that we've given for net income in the fourth quarter and therefore, our full-year guidance, but that will of course impact net income to the positive in 2026. So that if we're able to put on good growth in the fourth quarter, we will take that opportunity to do so.

展望第四季度，就我們的業績指引而言，我們再次面臨不確定性。我們希望確保發放優質貸款，如果因為能夠在風險承受範圍內滿足需求並達到預期回報目標而有機會實現更快增長，我們就會這樣做。請記住，如果我們成長速度超過預期，這當然會對 CECL 產生影響，並會影響我們對第四季度淨收入的預期，進而影響我們全年的預期，但這當然會對 2026 年的淨收入產生積極影響。所以，如果我們在第四季能夠實現良好的成長，我們將抓住這個機會。

Yeah, and Vincent, great working with you as well. The only thing I would add to Harp's commentary is, obviously, the government shutdown's still going underway. We've taken steps to reduce our direct mail in geographies that have concentration of government employees. We're also got a tighter risk box around those government employees in terms of verification of income and the like, and how much we will renew with them until we get a better lens on when the shutdown might end. And so I think we're being appropriately cautious going into the fourth quarter, given what's happening in DC.

是的，還有文森特，和你一起工作也很愉快。我唯一要補充的是，哈普的評論很顯然是，政府停擺仍在進行中。我們已採取措施，減少在政府僱員集中地區的直接郵寄量。我們也對這些政府員工實施了更嚴格的風險控制，包括收入核實等方面，以及在更好地了解政府停擺何時結束之前，我們會與他們續簽多少合約。因此，考慮到華盛頓特區正在發生的事情，我認為我們進入第四季度時採取謹慎的態度是恰當的。

Okay, great. Thank you. And that actually sort of touches on my next question, which is that marketing expense was pretty efficient this quarter, even with you beating your loan outlook expenses. Marketing expenses were down $800,000 quarter over quarter. So I'm just wondering if that's a sustainable efficiency with your marketing? Or I guess was that pulled back in direct mail to government employees? Or if you can maybe talk about that in more detail.

好的，太好了。謝謝。這其實也引出了我的下一個問題，那就是，即使你們的貸款預期支出超過了預期，本季的行銷支出仍然相當有效。行銷費用較上季下降80萬美元。所以我想知道，這樣的行銷效率是否可持續？或者我猜想，那份直接寄給政府員工的郵件被撤回了？或者您能否更詳細地談談這件事？

So that really has to do with our new models that we've spoken about in the past, Vincent. So our new models are very efficient, and we're able to make use of them, and we can do a number of things with them, right? We could either mail more with less marketing dollars, or we could remain at the same marketing dollars and have higher volumes. And we're also able to adjust for risk.

文森特，這確實與我們之前討論過的新模型有關。所以我們的新模型非常高效，我們可以充分利用它們，而且我們可以用它們做很多事情，對吧？我們可以用更少的行銷預算增加郵件發送量，也可以在行銷預算不變的情況下提高郵件發送量。我們還可以進行風險調整。

So what we did in the quarter, given where demand was, we were able to spend money and be more efficient while choosing the right customers to meet our risk box. So that's really what you see there in terms of the marketing spend. Again, given our growth in the fourth quarter, you will hopefully see the same in the fourth quarter. in terms of those models working for us. So we're hoping that that is sustainable in the future with those new models.

因此，鑑於本季的需求情況，我們能夠合理地花錢，提高效率，同時選擇合適的客戶來滿足我們的風險承受能力。所以，這就是你在行銷支出方面看到的情況。鑑於我們第四季的成長，希望在第四季也能看到同樣的成長勢頭，即這些模式對我們有效。所以我們希望這些新模式在未來能持續發展。

Yeah, and Vince, we talked abut this. The direct mail customer lifetime value gives us the ability to see the profitability curves across all line items projected out for a couple years to like each mailing. And we can actually turn on and off risk segments, states, whatever, to optimize our spend, or to optimize revenue, or to optimize growth, or to optimize losses, or to optimize profitability 12 months out. So the power of these models, again, they get refreshed for the current environment. The power of these models is something that a lot of investment went into, and it's starting to pay off.

是的，還有文斯，我們談過這件事。直效郵件客戶終身價值使我們能夠看到未來幾年內所有專案的獲利曲線，例如每次郵件的獲利曲線。我們實際上可以開啟或關閉風險細分、狀態等等，以優化我們的支出、收入、成長、損失或未來 12 個月的獲利能力。因此，這些模型的效力在於，它們會根據當前環境進行更新。這些模型的強大功能是投入大量資金研發的成果，現在開始獲得回報了。

Ladies and gentlemen, with no further questions in the question queue, I will now hand back over to Rob Beck for closing remarks.

女士們、先生們，由於沒有其他問題需要提問，我現在將發言權交還給羅伯貝克，請他作總結發言。

Yes, thanks, operator, and thanks, everyone, for joining. I want to first thank our investors who have supported the team and I over the last 5.5 years. We're proud of what we have been able to accomplish in transforming the business during, as I said, a very difficult time with COVID and the period of high inflation. You know, since I started in my role, we've had total shareholder return of over 230%. We returned $178 million of capital to shareholders in the form of dividends and buybacks, and we increased our Tampa book value by more than $13 per share, and most importantly, remained profitable through the cycle.

是的，謝謝接線生，也謝謝大家的參與。首先，我要感謝過去 5.5 年來一直支持我和團隊的各位投資人。正如我所說，在新冠疫情和高通膨時期，我們經歷了非常艱難的時期，但我們仍然成功地轉型了業務，我們為此感到自豪。你知道嗎，自從我擔任這個職位以來，我們的股東總回報率已經超過 230%。我們以股息和股票回購的形式向股東返還了 1.78 億美元的資本，並將坦帕的帳面價值提高了每股 13 美元以上，最重要的是，我們在整個週期中保持了盈利。

Now, I've gotten to know Lakhbir, and I am confident that he will continue to build upon our momentum to grow our franchise, and of course, I will be available to assist with the transition through June of next year. I also want to thank the Board for their support over the last 5.5 years, and last but not least, I want to thank the entire Regional team.

現在，我已經認識了拉克比爾，我相信他會繼續保持我們目前的勢頭，發展壯大我們的特許經營業務。當然，我也會協助他完成過渡，直到明年六月。我還要感謝董事會在過去 5.5 年給予的支持，最後，我還要感謝整個區域團隊。

We've been together from the start of my time at Regional and they are an incredible group and I think the best in the industry. Everything that has been accomplished is due to their unwavering dedication and hard work in support of our customers, and I will miss them greatly.

自從我加入 Regional 以來，我們就一直在一起，他們是一個非常棒的團隊，我認為他們是業內最好的團隊。我們所取得的一切成就都歸功於他們對客戶的堅定奉獻和辛勤工作，我會非常想念他們。

Access to capital is essential for every person to build a productive life, and Regional provides this to subprime customers that need it the most, something of which we are all very proud of. And lastly, any CEO that has operated since COVID will tell you it has been a demanding journey, but also a rewarding one. As my family knows, and Harp, I put everything I had in Regional 24x7. And it's now time to focus on my family, my health, and the next chapter of my life, and I wish you all the very best.

獲得資金對於每個人建立富有成效的生活至關重要，而 Regional 為​​最需要資金的次級客戶提供這種資金，我們對此都感到非常自豪。最後，任何一位在新冠疫情期間營運的執行長都會告訴你，這是一段充滿挑戰但又收穫豐富的旅程。正如我的家人和 Harp 所知，我把所有的一切都投入了 Regional 24x7 中。現在是時候把注意力放在我的家人、我的健康以及我人生的下一個篇章上了，祝大家一切順利。

Thank you, sir. Ladies and gentlemen, that concludes this event. Thank you for attending. And you may now disconnect your lines.

謝謝您，先生。女士們、先生們，本次活動到此結束。謝謝各位的出席。現在您可以斷開線路了。