TORONTO, Nov. 29, 2018 /CNW/ - Axis Auto Finance Inc. ("Axis" or the "Company"), (TSXV: AXIS) Canada's fastest growing publicly-traded sub-prime automotive finance company, today announced financial results for the first quarter of fiscal 2019 ending September 30, 2018.
- Record Adjusted Earnings1 of $1.6 million in first quarter 2019 compared to $0.5 million in the first quarter 2018;
- Record $18.2 million in originations in the first quarter 2019;
- Record gross finance receivables of $116.4 million as at September 30, 2018;
- Record quarterly revenues of $8.4 million compared to $2.2 million in first quarter of 2018;
- Average annualized portfolio yield in first quarter of 35.3% compared to 35.7% in fiscal 2018;
- Annualized credit loss rate at 6.96%, down from 7.23% in fiscal 2018; and
- Adjusted EPS of $0.017 for the quarter.
Finance receivables originations for the first quarter of fiscal 2019 were $18.2 million, contributing to the growth in gross finance receivables to $116.4 million as at September 30, 2018 from $111.5 million at June 30, 2018.
In this quarter Axis adopted IFRS 9 Financial Instruments ("IFRS 9") which increased the size of the allowance for credit losses that the Company maintains on its balance sheet from $2.5 million at June 30, 2018 to $9 million at September 30, 2018. As a result, net finance receivables decreased from $109 million to $107 million over the same period. There has been no impact on credit performance or cash flows.
Revenues of $8.4 million for the first quarter 2019, increased 290% from $2.2 million for the first quarter 2018, equating to an annualized revenue run-rate of $33.7 million.
Portfolio yields maintained strong levels, at 35.3% for the first quarter 2019, as compared to 35.7% in 2018. Equally as strong was the annualized credit loss rate of 6.96% in the first quarter 2019, down from 7.23% in fiscal 2018.
Adjusted earnings for the first quarter of 2019 were $1.6 million, as compared to $0.5 million in the first quarter of 2018, a 213% increase. Adjusted EPS was $0.017 for the quarter or approximately $0.069 on an annualized basis.
Net loss for the first quarter ending September 30, 2018 was $0.3 million or $0.004 per share, after accounting for the new IFRS 9 provisioning for credit losses, as compared to net income of $0.1 million or $0.001 per share for the comparative quarter ending September 30, 2017.
Book value of the Company was $36.8 million at September 30, 2018, post reduction of $4.3 million to retained earnings from the one-time increase to the allowance for credit losses resulting from the adoption of IFRS 9.
About Axis Auto Finance
Axis provides non-standard financing options targeting roughly 30% of Canadians (Source: Equifax) that do not qualify for traditional bank-type financing for their used vehicle purchase. Through personalized service and a commitment to building strong, long-lasting relationships with dealer partners, Axis continues to be one of Canada's fastest-growing auto-financing companies.
Further information on the Company can be found at www.axisautofinance.com.
1 In order to track the performance of its finance receivable portfolio in a given period without the volatility associated with estimates and assumptions, Axis introduced a non-IFRS measure called Adjusted Earnings. This measure, now included in the MD&A, is equal to the net income (loss) for the period, adjusted for (i) non-cash expense items (as identified in the Statement of Cash Flows) (ii) actual credit losses incurred (iii) non-recurring one time transaction and integration costs and (iv) specified expenses which were entirely recognized in a given quarter but for which the benefit was derived over more than a given quarter. For further information on Axis non-IFRS measures, please see the Management's Discussion and Analysis for the corresponding period.
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SOURCE Axis Auto Finance Inc.