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Credit Acceptance Corporation reports developments tied to its consumer automobile finance business, which provides financing programs through a nationwide network of automobile dealers. The company focuses on enabling dealers to sell vehicles to consumers regardless of credit history, with revenue tied primarily to finance charges, servicing fees, reinsurance premiums on vehicle service contracts, and other fees.
Recurring CACC news includes quarterly earnings, adjusted net income measures, loan portfolio performance, forecasted collections, dealer and consumer product initiatives, executive appointments, and asset-backed non-recourse secured financings. Company updates also address digital credit applications, franchise dealer experience, consumer self-service tools, and capital transactions that use special purpose entities and trusts to fund conveyed consumer loans.
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Credit Acceptance Corporation (CACC) mourns the loss of its founder, Don Foss, who passed away on August 14, 2022, from cancer complications. His innovative approach in the automotive industry began in 1967, leading to the establishment of one of the largest auto finance companies in the U.S. Don served as CEO from 1972 to 2002 and was recognized with various awards for his contributions. He established scholarships for students in automotive careers and was dedicated to philanthropy, leaving behind a legacy of community service. The company expresses deep condolences to the Foss family and acknowledges his impactful legacy.
On August 12, 2022, Credit Acceptance Corporation (CACC) announced a three-year extension of its $500 million asset-backed non-recourse secured financing, originally established on August 28, 2019. The revolving period for this financing has been extended from August 15, 2022, to August 15, 2025. Additionally, the interest rate was increased from 3.13% to 5.15%, while the servicing fee was reduced from 6.0% to 4.0% of collections on the underlying consumer loans. No other material terms were altered in this financing agreement.
Credit Acceptance Corporation (CACC) reported Q2 2022 consolidated net income of $107.4 million ($7.94 per diluted share), down 62.8% from $288.6 million in Q2 2021. Year-to-date, net income reached $321.7 million, down 34.4% from $490.7 million in 2021. Adjusted net income for Q2 was $188.2 million ($13.92 per share) versus $230.3 million in 2021. Consumer Loan assignment volume grew 5.1% in units and 22.0% in dollar amounts compared to the same period last year. A $12 million legal settlement impacted earnings, coupled with a 583.6% rise in provisions for credit losses, emphasizing ongoing challenges in credit performance.
Credit Acceptance Corporation (CACC) announced plans to release its second quarter 2022 earnings on August 1, 2022, post-market close. A webcast is scheduled for the same day at 5:00 PM ET to discuss the earnings. Interested participants can register for the conference call via a provided link to access dial-in numbers. Credit Acceptance has been facilitating auto financing since 1972, helping consumers with poor credit obtain vehicles and improve their credit scores through their programs.
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Credit Acceptance Corporation (Nasdaq: CACC) announced an extension of its revolving secured line of credit facility maturity from June 22, 2024, to June 22, 2025. This amendment increased the facility amount by $10 million, resulting in a net decrease to $410 million. The company will continue to see a decrease of $25 million on June 22, 2023. Additionally, the amendment eliminated the covenant requiring a minimum consolidated net income of $1 for the last two fiscal quarters. As of June 22, 2022, $192.5 million was outstanding under this facility.
Credit Acceptance Corporation (Nasdaq: CACC) announced the completion of a $350 million asset-backed financing secured by approximately $437.6 million in loans. The financing, with an expected annualized cost of about 5.4%, is set to revolve for 24 months before amortizing. The funds will be used for repaying outstanding debt and general corporate purposes. Additionally, the company extended the revolving secured warehouse facility's maturity from November 2023 to May 2025, with no outstanding balance as of June 16, 2022.