<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 2000
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number 1-10667
AMERICREDIT CORP.
(Exact name of registrant as specified in its charter)
Texas 75-2291093
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
801 CHERRY STREET, SUITE 3900, FORT WORTH, TEXAS 76102
(Address of principal executive offices, including Zip Code)
(817) 302-7000
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes /X/ No / /
There were 75,767,508 shares of common stock, $0.01 par value outstanding as of
April 28, 2000.
<PAGE>
AMERICREDIT CORP.
INDEX TO FORM 10-Q
Part I. FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Page
----
<S> <C>
Item 1. Financial Statements
Consolidated Balance Sheets -
March 31, 2000 and June 30, 1999 (unaudited) ................... 3
Consolidated Statements of Income and Comprehensive
Income - Three Months and Nine Months Ended
March 31, 2000 and 1999 (unaudited) ............................ 4
Consolidated Statements of Cash Flows - Nine Months
Ended March 31, 2000 and 1999 (unaudited) ...................... 5
Notes to Consolidated Financial Statements ..................... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations ................ 17
Item 3. Quantitative and Qualitative Disclosures
About Market Risk ............................................ 33
Part II. OTHER INFORMATION
Item 1. Legal Proceedings ............................................ 34
Item 6. Exhibits and Reports on Form 8-K ............................. 35
SIGNATURE ......................................................................... 36
</TABLE>
2
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
AMERICREDIT CORP.
Consolidated Balance Sheets
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
March 31, 2000 June 30, 1999
-------------- -------------
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 50,818 $ 21,189
Receivables held for sale, net 688,021 456,009
Interest-only receivables from Trusts 223,411 191,865
Investments in Trust receivables 300,169 195,598
Restricted cash 215,533 107,399
Property and equipment, net 46,396 41,145
Other assets 60,949 50,282
---------- ----------
Total assets $1,585,297 $1,063,487
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Warehouse credit facilities $ 324,647 $ 114,659
Credit enhancement facility 45,000
Senior notes 375,000 375,000
Other notes payable 21,398 17,874
Funding payable 54,792 43,042
Accrued taxes and expenses 57,481 39,187
Deferred income taxes 86,294 73,995
---------- ----------
Total liabilities 964,612 663,757
---------- ----------
Shareholders' equity
Preferred stock, $0.01 par value per share;
20,000,000 shares authorized,
none issued
Common stock, $0.01 par value per share;
120,000,000 shares authorized; 82,174,205
and 71,498,474 shares issued 822 715
Additional paid-in capital 382,203 252,194
Accumulated other comprehensive income 34,230 21,410
Retained earnings 224,953 147,610
---------- ----------
642,208 421,929
Treasury stock, at cost (7,131,957 and
7,375,030 shares) (21,523) (22,199)
---------- ----------
Total shareholders' equity 620,685 399,730
---------- ----------
Total liabilities and shareholders' equity $1,585,297 $1,063,487
========== ==========
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements
3
<PAGE>
AMERICREDIT CORP.
Consolidated Statements of Income and Comprehensive Income
(Unaudited, Dollars in Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
-------------------------- --------------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenue:
Finance charge income $ 30,512 $ 18,361 $ 85,506 $ 51,538
Gain on sale of receivables 52,923 42,531 151,165 116,551
Servicing fee income 44,645 23,691 120,528 61,702
Other income 1,953 484 4,697 3,361
----------- ----------- ----------- -----------
130,033 85,067 361,896 233,152
----------- ----------- ----------- -----------
Costs and expenses:
Operating expenses 55,488 42,025 162,031 115,760
Provision for losses 3,986 2,286 11,229 6,589
Interest expense 17,858 9,041 48,263 25,660
Charge for closing
mortgage operations 10,500
----------- ----------- ----------- -----------
77,332 53,352 232,023 148,009
----------- ----------- ----------- -----------
Income before income taxes 52,701 31,715 129,873 85,143
Income tax provision 20,291 12,210 52,530 32,780
----------- ----------- ----------- -----------
Net income 32,410 19,505 77,343 52,363
----------- ----------- ----------- -----------
Other comprehensive income:
Unrealized gain (loss) on credit
enhancement assets (1,272) 2,778 20,803 9,895
Related income tax benefit (expense) 489 (1,070) (7,983) (3,810)
----------- ----------- ----------- -----------
(783) 1,708 12,820 6,085
----------- ----------- ----------- -----------
Comprehensive income $ 31,627 $ 21,213 $ 90,163 $ 58,448
=========== =========== =========== ===========
Earnings per share:
Basic $ 0.43 $ 0.31 $ 1.07 $ 0.83
=========== =========== =========== ===========
Diluted $ 0.41 $ 0.29 $ 1.01 $ 0.78
=========== =========== =========== ===========
Weighted average shares 74,869,550 63,187,789 72,110,495 62,872,858
=========== =========== =========== ===========
Weighted average shares and
assumed incremental shares 79,027,907 66,514,367 76,544,943 66,822,426
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements
4
<PAGE>
AMERICREDIT CORP.
Consolidated Statements of Cash Flows
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
---------------------------
2000 1999
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 77,343 $ 52,363
Adjustments to reconcile net income to
net cash provided by operating activities:
Non-cash charge for closing mortgage operations 6,566
Depreciation and amortization 13,527 6,902
Provision for losses 11,229 6,589
Deferred income taxes 9,584 33,041
Non-cash servicing fee (31,388) (10,739)
Non-cash gain on sale of auto receivables (138,753) (107,642)
Distributions from Trusts 79,443 35,182
Changes in assets and liabilities:
Other assets (9,972) (2,746)
Accrued taxes and expenses 18,294 18,014
----------- -----------
Net cash provided by operating activities 35,873 30,964
----------- -----------
Cash flows from investing activities:
Purchases of auto receivables (3,166,671) (1,976,508)
Originations of mortgage receivables (109,688) (203,518)
Principal collections and recoveries on
receivables 27,849 14,783
Net proceeds from sale of auto receivables 2,894,504 1,894,383
Net proceeds from sale of mortgage receivables 122,515 198,953
Initial deposits to restricted cash (132,750) (57,250)
Return of deposits from restricted cash 23,000
Net change in credit enhancement facility 45,000
Purchases of property and equipment (6,891) (8,431)
Increase in other assets (7,361) (7,387)
----------- -----------
Net cash used in investing activities (333,493) (121,975)
----------- -----------
Cash flows from financing activities:
Net change in warehouse credit facilities 209,988 89,923
Payments on other notes payable (8,263) (2,629)
Proceeds from issuance of common stock 125,524 7,476
----------- -----------
Net cash provided by financing activities 327,249 94,770
----------- -----------
Net increase in cash and cash equivalents 29,629 3,759
Cash and cash equivalents at beginning of period 21,189 33,087
----------- -----------
Cash and cash equivalents at end of period $ 50,818 $ 36,846
=========== ===========
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements
5
<PAGE>
AMERICREDIT CORP.
Notes to Consolidated Financial Statements
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying consolidated financial statements include the accounts of
AmeriCredit Corp. and its wholly-owned subsidiaries ("the Company"). All
significant intercompany accounts and transactions have been eliminated in
consolidation.
The consolidated financial statements as of March 31, 2000 and for the periods
ended March 31, 2000 and 1999 are unaudited, but in management's opinion include
all adjustments necessary for a fair presentation of the results for such
interim periods. Certain prior year amounts have been reclassified to conform to
the current period presentation. The results for interim periods are not
necessarily indicative of results for a full year.
The interim period financial statements, including the notes thereto, are
condensed and do not include all disclosures required by generally accepted
accounting principles. These interim period financial statements should be read
in conjunction with the Company's consolidated financial statements which are
included in the Company's Annual Report on Form 10-K for the year ended June 30,
1999.
NOTE 2 - RECEIVABLES HELD FOR SALE
Receivables held for sale consist of the following (in thousands):
<TABLE>
<CAPTION>
March 31, 2000 June 30, 1999
-------------- -------------
<S> <C> <C>
Auto receivables $699,450 $444,128
Less allowance for losses (20,488) (11,841)
---------- ----------
Auto receivables, net 678,962 432,287
Mortgage receivables 9,059 23,722
---------- ----------
$688,021 $456,009
========== ==========
</TABLE>
A summary of the allowance for losses is as follows (in thousands):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
---------------------------- ---------------------------
2000 1999 2000 1999
---------- ------------ ---------- ----------
<S> <C> <C> <C> <C>
Balance at beginning of period $ 16,861 $ 8,377 $ 11,841 $ 12,756
Provision for losses 3,986 2,286 11,229 6,589
Acquisition fees 26,935 17,185 69,433 44,614
Allowance related to auto
receivables sold to Trusts (24,827) (15,014) (66,164) (47,702)
Net charge-offs (2,467) (2,285) (5,851) (5,708)
---------- ------------ ---------- ----------
Balance at end of period $ 20,488 $ 10,549 $ 20,488 $ 10,549
========== ========== ========== ==========
</TABLE>
6
<PAGE>
NOTE 3 - CREDIT ENHANCEMENT ASSETS
As of March 31, 2000 and June 30, 1999, the Company was servicing $5,250.5
million and $3,661.3 million, respectively, of auto receivables which have been
sold to certain special purpose financing trusts (the "Trusts"). The Company has
retained an interest in these receivables in the form of credit enhancement
assets.
Credit enhancement assets consist of the following (in thousands):
<TABLE>
<CAPTION>
March 31, 2000 June 30, 1999
-------------- -------------
<S> <C> <C>
Interest-only receivables from Trusts $223,411 $191,865
Investments in Trust receivables 300,169 195,598
Restricted cash 215,533 107,399
-------------- -------------
$739,113 $494,862
============== =============
</TABLE>
A summary of activity in the credit enhancement assets is as follows (in
thousands):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
-------------------------- ---------------------------
2000 1999 2000 1999
------------ ----------- ------------ ------------
<S> <C> <C> <C> <C>
Balance at beginning of period $685,061 $381,701 $494,862 $286,309
Non-cash gain on sale of auto
receivables 46,083 37,239 138,753 107,642
Accretion of present value discount 11,223 9,196 31,388 24,139
Initial deposits to restricted cash 40,750 21,000 132,750 57,250
Return of deposits from restricted
cash (23,000) (23,000)
Change in unrealized gain (1,272) 2,778 20,803 9,895
Distributions from Trusts (42,732) (10,261) (79,443) (35,182)
Permanent impairment write-down (5,000) (13,400)
------------ ----------- ------------ ------------
Balance at end of period $739,113 $413,653 $739,113 $413,653
============ =========== ============ ============
</TABLE>
A summary of the allowance for losses included as a component of the
interest-only receivables is as follows (in thousands):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
---------------------------- -----------------------------
2000 1999 2000 1999
------------ ------------ ------------ -----------
<S> <C> <C> <C> <C>
Balance at beginning of period $452,221 $256,599 $ 354,338 $179,359
Assumptions for cumulative
credit losses 106,883 73,251 302,289 204,441
Permanent impairment write-down 5,000 13,400
Net charge-offs (51,530) (35,833) (149,053) (98,183)
------------ ------------ ------------ -----------
Balance at end of period $507,574 $299,017 $ 507,574 $299,017
============ ============ ============ ===========
</TABLE>
7
<PAGE>
NOTE 4 - WAREHOUSE CREDIT FACILITIES
Warehouse credit facilities consist of the following (in thousands):
<TABLE>
<CAPTION>
March 31, 2000 June 30, 1999
--------------- --------------
<S> <C> <C>
Commercial paper facilities $320,669 $ 94,369
Credit agreements 3,978 1,306
Mortgage facility - 18,984
--------------- --------------
$324,647 $114,659
=============== ==============
</TABLE>
The Company has three separate funding agreements with administrative agents on
behalf of institutionally managed commercial paper conduits and bank groups with
aggregate structured warehouse financing availability of $1.4 billion. The first
facility was expanded in March 2000, increasing the amount of available
structured warehouse financing to $725 million from $675 million, and matures in
September 2000. The second facility provides for available structured warehouse
financing of $250 million through September 2000. The third facility provides
for available structured warehouse financing of $375 million through March 2001.
Under these funding agreements, the Company transfers auto receivables to
special purpose finance subsidiaries of the Company, and these subsidiaries in
turn issue notes, collateralized by such auto receivables, to the agents. The
agents provide funding under the notes to the subsidiaries pursuant to an
advance formula and the subsidiaries forward the funds to the Company in
consideration for the transfer of auto receivables. While these subsidiaries are
included in the Company's consolidated financial statements, these subsidiaries
are separate legal entities and the auto receivables and other assets held by
the subsidiaries are legally owned by these subsidiaries and are not available
to creditors of AmeriCredit Corp. or its other subsidiaries. Advances under the
funding agreements bear interest at commercial paper, London Interbank Offered
Rates ("LIBOR") or prime rates plus specified fees depending upon the source of
funds provided by the agents. The funding agreements contain various covenants
requiring certain minimum financial ratios and results.
The Company had a revolving credit agreement with a group of banks under which
the Company could borrow up to $90 million, subject to a defined borrowing base.
The credit agreement expired in March 2000 and was not renewed by the Company.
In March 2000, the Company's Canadian subsidiary renewed its convertible
revolving term credit agreement with a bank, increasing the amount the
subsidiary may borrow under the credit agreement from $20 million to $30 million
Cdn., subject to a defined borrowing base. Borrowings under the credit agreement
are collateralized by certain Canadian auto receivables and bear interest at the
Canadian prime rate. The credit agreement, which expires in March 2001, contains
various restrictive covenants requiring certain
8
<PAGE>
minimum financial ratios and results and placing certain limitations on the
prepayment of senior notes, cash dividends and repurchase of common stock.
NOTE 5 - CREDIT ENHANCEMENT FACILITY
In October 1999, the Company entered into a credit enhancement facility with a
financial institution under which the Company may borrow up to $225 million to
fund a portion of the initial restricted cash deposit required in its
securitization transactions. The Company had previously utilized reinsurance
arrangements to reduce the initial restricted cash deposit. These arrangements
were reinsurance agreements and not funded debt and therefore were not recorded
as such on the Company's consolidated balance sheet.
Borrowings under the credit enhancement facility are available on a revolving
basis through October 2001 and are collateralized by the Company's credit
enhancement assets. The facility contains covenants requiring certain asset
performance ratios.
NOTE 6 - CHARGE FOR CLOSING MORTGAGE OPERATIONS
As a result of declining premiums received for the sale of mortgage loans in the
secondary markets, the Company ceased wholesale originations of mortgage loans
and closed its mortgage loan production and processing offices during the
quarter ended December 31, 1999.
The Company recognized a pre-tax charge of $10.5 million related to the closing
of the mortgage operations. The charge consisted of a $6.6 million write-off of
goodwill, $2.0 million of reserves against mortgage receivables held for sale
and $1.9 million of severance, facility closing and other costs. Reserves and
accrued costs remaining at March 31, 2000 were $2.5 million. Since the goodwill
write-off is not deductible for income tax reporting purposes, the charge
amounted to approximately $9.0 million after related income tax benefits.
NOTE 7 - SUPPLEMENTAL INFORMATION
Cash payments (receipts) for interest costs and income taxes consist of the
following (in thousands):
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
---------------------------
2000 1999
----------- ------------
<S> <C> <C>
Interest costs (none capitalized) $45,500 $ 29,237
Income taxes 37,611 (14,000)
</TABLE>
During the nine months ended March 31, 2000 and 1999, the Company entered into
lease agreements for property and equipment of $11,787,000 and $8,978,000
respectively.
9
<PAGE>
NOTE 8 - GUARANTOR CONSOLIDATING FINANCIAL STATEMENTS
The payment of principal, premium, if any, and interest on the Company's senior
notes is guaranteed by certain of the Company's subsidiaries (the "Subsidiary
Guarantors"). The separate financial statements of the Subsidiary Guarantors are
not included herein because the Subsidiary Guarantors are wholly-owned
consolidated subsidiaries of the Company and are jointly, severally and
unconditionally liable for the obligations represented by the senior notes. The
Company believes that the condensed consolidating financial information for the
Company, the combined Subsidiary Guarantors and the combined Non-Guarantor
Subsidiaries provide information that is more meaningful in understanding the
financial position of the Subsidiary Guarantors than separate financial
statements of the Subsidiary Guarantors.
The following supplementary information presents consolidating financial data
for (i) AmeriCredit Corp. (on a parent only basis), (ii) the combined Subsidiary
Guarantors, (iii) the combined Non-Guarantor Subsidiaries, (iv) an elimination
column for adjustments to arrive at the information for the Company and its
subsidiaries on a consolidated basis and (v) the Company and its subsidiaries on
a consolidated basis.
Investments in subsidiaries are accounted for by the parent company using the
equity method for purposes of this presentation. Earnings of subsidiaries are
therefore reflected in the parent company's investment accounts and earnings.
The principal elimination entries set forth below eliminate investments in
subsidiaries and intercompany balances and transactions.
10
<PAGE>
AmeriCredit Corp.
Consolidating Balance Sheet
March 31, 2000
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
AmeriCredit Non-
Corp. Guarantors Guarantors Eliminations Consolidated
----------- ----------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents $ $ 63,918 $ (13,100) $ $ 50,818
Receivables held for sale, net 338,653 349,368 688,021
Interest-only receivables
from Trusts 2,278 221,133 223,411
Investments in Trust
receivables 300,169 300,169
Restricted cash 215,533 215,533
Property and equipment, net 349 46,047 46,396
Other assets 10,775 30,947 19,227 60,949
Due (to) from affiliates 696,575 (664,947) (31,628)
Investment in affiliates 266,818 123,737 1,100 (391,655)
-------- --------- ---------- --------- ----------
Total assets $976,795 $ (61,645) $1,061,802 $(391,655) $1,585,297
======== ========= ========== ========= ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Warehouse credit facilities $ $ 3,978 $ 320,669 $ $ 324,647
Credit enhancement facility 45,000 45,000
Senior notes 375,000 375,000
Other notes payable 21,398 21,398
Funding payable 54,711 81 54,792
Accrued taxes and expenses 23,625 32,080 1,776 57,481
Deferred income taxes (63,913) (60,854) 211,061 86,294
-------- --------- ---------- --------- ----------
Total liabilities 356,110 29,915 578,587 964,612
-------- --------- ---------- --------- ----------
Shareholders' equity
Common stock 822 32 1 (33) 822
Additional paid-in capital 382,203 39,086 123,925 (163,011) 382,203
Accumulated other
comprehensive income 34,230 34,230 (34,230) 34,230
Retained earnings 224,953 (130,678) 325,059 (194,381) 224,953
-------- --------- ---------- --------- ----------
642,208 (91,560) 483,215 (391,655) 642,208
Treasury stock (21,523) (21,523)
-------- --------- ---------- --------- ----------
Total shareholders' equity 620,685 (91,560) 483,215 (391,655) 620,685
-------- --------- ---------- --------- ----------
Total liabilities and
shareholders' equity $976,795 $ (61,645) $1,061,802 $(391,655) $1,585,297
======== ========= ========== ========= ==========
</TABLE>
11
<PAGE>
AmeriCredit Corp.
Consolidating Balance Sheet
June 30, 1999
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
AmeriCredit Non-
Corp. Guarantors Guarantors Eliminations Consolidated
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents $ $ 20,246 $ 943 $ $ 21,189
Receivables held for sale, net 256,771 199,238 456,009
Interest-only receivables
from Trusts 1,337 190,528 191,865
Investments in Trust
receivables 195,598 195,598
Restricted cash 107,399 107,399
Property and equipment, net 349 40,796 41,145
Other assets 11,510 30,170 8,602 50,282
Due (to) from affiliates 567,368 (478,520) (88,848)
Investment in affiliates 198,339 118,024 1,050 (317,413)
--------------- --------------- --------------- --------------- ---------------
Total assets $778,903 $ (12,513) $614,510 $(317,413) $1,063,487
=============== =============== =============== =============== ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Warehouse credit facilities $ $ 20,290 $ 94,369 $ $ 114,659
Senior notes 375,000 375,000
Other notes payable 17,874 17,874
Funding payable 43,042 43,042
Accrued taxes and expenses 16,062 22,860 265 39,187
Deferred income taxes (29,763) (42,016) 145,774 73,995
--------------- --------------- --------------- --------------- ---------------
Total liabilities 379,173 44,176 240,408 663,757
--------------- --------------- --------------- --------------- ---------------
Shareholders' equity
Common stock 715 203 3 (206) 715
Additional paid-in capital 252,194 108,475 118,840 (227,315) 252,194
Accumulated other
comprehensive income 21,410 21,410 (21,410) 21,410
Retained earnings 147,610 (165,367) 233,849 (68,482) 147,610
--------------- --------------- --------------- --------------- ---------------
421,929 (56,689) 374,102 (317,413) 421,929
Treasury stock (22,199) (22,199)
--------------- --------------- --------------- --------------- ---------------
Total shareholders' equity 399,730 (56,689) 374,102 (317,413) 399,730
--------------- --------------- --------------- --------------- ---------------
Total liabilities and
shareholders' equity $778,903 $ (12,513) $614,510 $(317,413) $1,063,487
=============== =============== =============== =============== ===============
</TABLE>
12
<PAGE>
AmeriCredit Corp.
Consolidating Income Statement
Nine Months Ended March 31, 2000
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
AmeriCredit Non-
Corp. Guarantors Guarantors Eliminations Consolidated
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Revenue:
Finance charge income $ $ 54,546 $ 30,960 $ $ 85,506
Gain on sale of receivables (14) 13,578 137,601 151,165
Servicing fee income 115,511 29,652 (24,635) 120,528
Other income 33,519 4,010 675 (33,507) 4,697
Equity in income of
affiliates 75,763 (75,763)
--------------- --------------- --------------- --------------- ---------------
109,268 187,645 198,888 (133,905) 361,896
--------------- --------------- --------------- --------------- ---------------
Costs and expenses:
Operating expenses 359 186,245 62 (24,635) 162,031
Provision for losses 5,967 5,262 11,229
Interest expense 30,578 5,937 45,255 (33,507) 48,263
Charge for closing
mortgage operations 10,500 10,500
--------------- --------------- --------------- --------------- ---------------
30,937 208,649 50,579 (58,142) 232,023
--------------- --------------- --------------- --------------- ---------------
Income before income taxes 78,331 (21,004) 148,309 (75,763) 129,873
Income tax provision 988 (5,557) 57,099 52,530
--------------- --------------- --------------- --------------- ---------------
Net income $ 77,343 $(15,447) $ 91,210 $(75,763) $ 77,343
=============== =============== =============== =============== ===============
</TABLE>
13
<PAGE>
AmeriCredit Corp.
Consolidating Income Statement
Nine Months Ended March 31, 1999
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
AmeriCredit Non-
Corp. Guarantors Guarantors Eliminations Consolidated
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Revenue:
Finance charge income $ $ 27,503 $ 24,035 $ $ 51,538
Gain on sale of receivables (6,394) 3,202 119,743 116,551
Servicing fee income 80,403 7,975 (26,676) 61,702
Other income 22,134 2,657 584 (22,014) 3,361
Equity in income of
affiliates 56,474 (56,474)
--------------- --------------- --------------- --------------- ---------------
72,214 113,765 152,337 (105,164) 233,152
--------------- --------------- --------------- --------------- ---------------
Costs and expenses:
Operating expenses 7,513 134,886 37 (26,676) 115,760
Provision for losses 2,471 4,118 6,589
Interest expense 13,566 16,918 17,190 (22,014) 25,660
--------------- --------------- --------------- --------------- ---------------
21,079 154,275 21,345 (48,690) 148,009
--------------- --------------- --------------- --------------- ---------------
Income before income taxes 51,135 (40,510) 130,992 (56,474) 85,143
Income tax provision (1,228) (18,654) 52,662 32,780
--------------- --------------- --------------- --------------- ---------------
Net income $ 52,363 $(21,856) $ 78,330 $ (56,474) $ 52,363
=============== =============== =============== =============== ===============
</TABLE>
14
<PAGE>
AmeriCredit Corp.
Consolidating Statement of Cash Flow
Nine Months Ended March 31, 2000
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
AmeriCredit Non-
Corp. Guarantors Guarantors Eliminations Consolidated
--------------- -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Cash flow from operating activities:
Net income $ 77,343 $ (15,447) $ 91,210 $ (75,763) $ 77,343
Adjustments to reconcile net income
to net cash provided by operating
activities:
Non-cash charge for closing
mortgage operations 6,566 6,566
Depreciation & amortization 13,527 13,527
Provision for losses 5,967 5,262 11,229
Deferred income taxes (28,882) (18,838) 57,304 9,584
Non-cash servicing fee
income (31,388) (31,388)
Non-cash gain on sale of
auto receivables (138,753) (138,753)
Distributions from Trusts 79,443 79,443
Equity in income of
affiliates (75,763) 75,763
Changes in assets and liabilities:
Other assets 735 (9,358) (1,349) (9,972)
Accrued taxes & expenses 7,563 9,220 1,511 18,294
--------------- -------------- --------------- --------------- ---------------
Net cash provided by operating
activities (19,004) (8,363) 63,240 35,873
--------------- -------------- --------------- --------------- ---------------
Cash flows from investing activities:
Purchase of auto receivables (3,166,671) (3,084,178) 3,084,178 (3,166,671)
Originations of mortgage
receivables (109,688) (109,688)
Principal collections and
recoveries on receivables (6,514) 34,363 27,849
Net proceeds from sale of
auto receivables 3,084,178 2,894,504 (3,084,178) 2,894,504
Net proceeds from sale of
mortgage receivables 122,515 122,515
Initial deposits to
restricted cash (132,750) (132,750)
Net change in credit
enhancement facility 45,000 45,000
Purchases of property and
equipment (6,891) (6,891)
Increase in other assets 1,915 (9,276) (7,361)
Net change in investment in
affiliates 20,104 (26,822) (50) 6,768
--------------- -------------- --------------- --------------- ---------------
Net cash used by investing
activities 20,104 (107,978) (252,387) 6,768 (333,493)
--------------- -------------- --------------- --------------- ---------------
Cash flows from financing activities:
Net change in warehouse
credit facilities (16,312) 226,300 209,988
Payments on other notes
payable (8,263) (8,263)
Proceeds from issuance of
common stock 125,524 1,685 5,083 (6,768) 125,524
Net change in due (to) from
affiliates (118,361) 174,640 (56,279)
--------------- -------------- --------------- --------------- ---------------
Net cash provided by financing
activities (1,100) 160,013 175,104 (6,768) 327,249
--------------- -------------- --------------- --------------- ---------------
Net increase in cash and
cash equivalents 43,672 (14,043) 29,629
Cash and cash equivalents at
beginning of period 20,246 943 21,189
--------------- -------------- --------------- --------------- ---------------
Cash and cash equivalents at
end of period $ $ 63,918 $ (13,100) $ $ 50,818
=============== ============== =============== =============== ===============
</TABLE>
15
<PAGE>
AmeriCredit Corp.
Consolidating Statement of Cash Flow
Nine Months Ended March 31, 1999
(Unaudited, Dollars in Thousands)
<TABLE>
<CAPTION>
AmeriCredit Non-
Corp. Guarantors Guarantors Eliminations Consolidated
--------------- -------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Cash flow from operating activities:
Net income $ 52,363 $ (21,856) $ 78,330 $ (56,474) $ 52,363
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation & amortization 41 6,861 6,902
Provision for losses 2,471 4,118 6,589
Deferred income taxes (955) (19,070) 53,066 33,041
Non-cash servicing fee
income (10,739) (10,739)
Non-cash gain on sale of
auto receivables (107,642) (107,642)
Distributions from Trusts 35,182 35,182
Equity in income of
affiliates (56,474) 56,474
Changes in assets and liabilities:
Other assets 1,766 (6,811) 2,299 (2,746)
Accrued taxes & expenses 7,369 5,448 5,197 18,014
--------------- -------------- --------------- --------------- ---------------
Net cash provided by operating
activities 4,110 (32,957) 59,811 30,964
--------------- -------------- --------------- --------------- ---------------
Cash flows from investing activities:
Purchase of auto receivables (1,976,508) (2,121,289) 2,121,289 (1,976,508)
Originations of mortgage
receivables (203,518) (203,518)
Principal collections and
recoveries on receivables (6,744) 21,527 14,783
Net proceeds from sale of
auto receivables 2,121,289 1,894,383 (2,121,289) 1,894,383
Net proceeds from sale of
mortgage receivables 198,953 198,953
Initial deposits to
restricted cash (57,250) (57,250)
Return of deposits from
restricted cash 23,000 23,000
Purchases of property and
equipment 134 (8,565) (8,431)
Increase in other assets (4,094) (3,293) (7,387)
--------------- -------------- --------------- --------------- ---------------
Net cash used by investing
activities 134 120,813 (242,922) (121,975)
--------------- -------------- --------------- --------------- ---------------
Cash flows from financing activities:
Net change in warehouse
credit facilities (3,030) 92,953 89,923
Payments on other notes
payable (2,625) (4) (2,629)
Proceeds from issuance of
common stock 7,327 149 7,476
Net change in due (to) from
affiliates (8,946) (84,173) 93,119
--------------- -------------- --------------- --------------- ---------------
Net cash provided by financing
activities (4,244) (87,058) 186,072 94,770
--------------- -------------- --------------- --------------- ---------------
Net increase in cash and
cash equivalents 798 2,961 3,759
Cash and cash equivalents at
beginning of period 30,157 2,930 33,087
--------------- -------------- --------------- --------------- ---------------
Cash and cash equivalents at
end of period $ $ 30,955 $ 5,891 $ $ 36,846
=============== ============== =============== =============== ===============
</TABLE>
16
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
The Company generates earnings and cash flow primarily from the purchase,
securitization and servicing of auto receivables. The Company purchases auto
finance contracts from franchised and select independent automobile
dealerships. To fund the acquisition of receivables prior to securitization,
the Company utilizes borrowings under its warehouse credit facilities. The
Company generates finance charge income on its receivables pending
securitization ("receivables held for sale") and pays interest expense on
borrowings under its warehouse credit facilities.
The Company sells receivables to securitization trusts ("Trusts") that, in
turn, sell asset-backed securities to investors. By securitizing its
receivables, the Company is able to lock in the gross interest rate spread
between the yield on such receivables and the interest rate payable on the
asset-backed securities. The Company recognizes a gain on the sale of
receivables to the Trusts which represents the difference between the sale
proceeds to the Company, net of transaction costs, and the Company's net
carrying value of the receivables, plus the present value of the estimated
future excess cash flows to be received by the Company over the life of the
securitization. Excess cash flows result from the difference between the
interest received from the obligors on the receivables and the interest paid
to investors in the asset-backed securities, net of credit losses and
expenses.
Excess cash flows from the Trusts are initially utilized to fund credit
enhancement requirements to secure financial guaranty insurance policies
issued by an insurance company to protect investors in the asset-backed
securities from losses. Once predetermined credit enhancement requirements
are reached and maintained, excess cash flows are distributed to the Company.
In addition to excess cash flows, the Company earns monthly base servicing
fee income of 2.25% per annum on the outstanding principal balance of
receivables securitized ("serviced receivables").
In November 1996, the Company acquired AmeriCredit Mortgage Services ("AMS"),
which originates and sells mortgage loans. Receivables originated in this
business are referred to as mortgage receivables. Such receivables are
generally packaged and sold for cash on a servicing released whole-loan
basis. The Company recognizes a gain at the time of sale.
The premiums received by AMS for the sale of mortgage loans in the secondary
markets deteriorated since the Company's acquisition of AMS. The average net
premium received on sales decreased to a low of 1.9% for the three months
ended September 30, 1999 from 5.6% for the period from the date of
acquisition of AMS through June 30, 1997. As a result, during October 1999,
Company management assessed various options with respect to the operations of
AMS and decided to cease the operations of AMS. The AMS wholesale mortgage
loan
17
<PAGE>
production and processing offices have been closed and the assets of AMS are
being liquidated.
The Company incurred a pre-tax charge of $10.5 million in the three months
ended December 31, 1999 related to the closing of its mortgage operations.
The charge consists of a $6.6 million write-off of goodwill, $2.0 million of
reserves against mortgage receivables held for sale and $1.9 million
severance, facility closing and other costs.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2000 AS COMPARED TO
THREE MONTHS ENDED MARCH 31, 1999
REVENUE:
The Company's average managed receivables outstanding consisted of the following
(in thousands):
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Auto:
Held for sale $ 533,259 $ 308,375
Serviced 5,060,612 2,970,569
----------------- ------------------
5,593,871 3,278,944
Mortgage 11,849 29,290
----------------- ------------------
$5,605,720 $3,308,234
================= ==================
</TABLE>
Average managed receivables outstanding increased by 69% as a result of
higher loan purchase volume. The Company purchased $1,155.1 million of auto
loans during the three months ended March 31, 2000, compared to purchases of
$766.8 million during the three months ended March 31, 1999. This growth
resulted from loan production at branches open during both periods as well as
expansion of the Company's branch network. Loan production at branch offices
opened prior to March 31, 1998 was 25% higher for the twelve months ended
March 31, 2000 versus the twelve months ended March 31, 1999. The Company
operated 186 auto lending branch offices as of March 31, 2000, compared to
168 as of March 31, 1999.
Finance charge income consisted of the following (in thousands):
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Auto $30,512 $17,652
Mortgage 709
----------------- ------------------
$30,512 $18,361
================= ==================
</TABLE>
18
<PAGE>
The increase in finance charge income is due primarily to an increase of 73% in
average auto receivables held for sale in the three months ended March 31, 2000
versus the three months ended March 31, 1999. The Company's effective yield on
its auto receivables held for sale decreased to 23.0% for the three months ended
March 31, 2000 from 23.2% for the three months ended March 31, 1999. The
effective yield is higher than the contractual rates of the Company's auto
finance contracts as a result of finance charge income earned between the date
the auto finance contract is originated by the automobile dealership and the
date the auto finance contract is funded by the Company.
The gain on sale of receivables consisted of the following (in thousands):
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Auto $52,923 $40,514
Mortgage 2,017
----------------- ------------------
$52,923 $42,531
================= ==================
</TABLE>
The increase in gain on sale of auto receivables resulted from the sale of
$1,025.0 million of receivables in the three months ended March 31, 2000 as
compared to $700.0 million of receivables sold in the three months ended March
31, 1999. The gain as a percentage of the sales proceeds decreased to 5.2% for
the three months ended March 31, 2000 from 5.8% for the three months ended March
31, 1999 as a result of an increase in US Treasury and other short term interest
rates.
Significant assumptions used in determining the gain on sale of auto receivables
were as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Cumulative credit losses (including
deferred gains) 10.9% 11.0%
Discount rate used to estimate
present value:
Interest-only receivables from Trusts 12.0% 12.0%
Investment in Trust receivables 7.8% 7.8%
Restricted cash 7.8% 7.8%
</TABLE>
The discount rates used to estimate the present value of credit enhancement
assets are based on the relative risks of each asset type. Interest-only
receivables represent estimated future excess cash flows in the Trusts, which
involves a greater degree of risk than investments in Trust receivables and
restricted cash. Investments in Trust receivables and restricted cash represent
assets currently held by the Trustee and are senior to the interest-only
receivables for credit enhancement purposes.
19
<PAGE>
Servicing fee income increased to $44.6 million, or 3.5% of average serviced
auto receivables, for the three months ended March 31, 2000, as compared to
$23.7 million, or 3.2% of average serviced auto receivables, for the three
months ended March 31, 1999. Servicing fee income represents accretion of the
present value discount on estimated future excess cash flows from the Trusts,
base servicing fees and other fees earned by the Company as servicer of the
auto receivables sold to the Trusts. Servicing fee income for the three
months ended March 31, 1999 also includes a charge of $5.0 million to
increase credit loss reserves related to certain of the Company's fiscal 1997
and 1996 securitization transactions since the Company's reassessment of
estimated cumulative credit losses for these transactions exceeded the
original estimates. The growth in servicing fee income exclusive of the
aforementioned charge is attributable to the increase in average serviced
auto receivables outstanding for the three months ended March 31, 2000
compared to the three months ended March 31, 1999.
COSTS AND EXPENSES:
Operating expenses as an annualized percentage of average managed receivables
outstanding decreased to 4.0% (due to the closing of the mortgage business
there were no mortgage operating expenses incurred) for the three months
ended March 31, 2000, compared to 5.2% (4.9% excluding operating expenses of
$2.4 million related to the mortgage business) for the three months ended
March 31, 1999. The ratio improved as a result of economies of scale realized
from a growing receivables portfolio and automation of loan origination,
processing and servicing functions. The dollar amount of operating expenses
increased by $13.5 million, or 32%, primarily due to the addition of auto
lending branch offices and management and auto loan processing and servicing
staff.
The provision for losses increased to $4.0 million for the three months ended
March 31, 2000 from $2.3 million for the three months ended March 31, 1999
due to higher average amounts of auto receivables held for sale. As a
percentage of average receivables held for sale, the provision for losses was
3.0% for the three months ended March 31, 2000 and 1999.
Interest expense increased to $17.9 million for the three months ended March
31, 2000 from $9.0 million for the three months ended March 31, 1999 due to
higher debt levels and effective interest rates. Average debt outstanding was
$709.0 million and $447.6 million for the three months ended March 31, 2000
and 1999, respectively. The Company's effective rate of interest paid on its
debt increased to 10.1% from 8.2% as a result of increased average amounts of
senior notes outstanding which have a higher cost than the Company's other
forms of balance sheet debt.
The Company's effective income tax rate was 38.5% for the three months ended
March 31, 2000 and 1999.
20
<PAGE>
NINE MONTHS ENDED MARCH 31, 2000 AS COMPARED TO
NINE MONTHS ENDED MARCH 31, 1999
REVENUE:
The Company's average managed receivables outstanding consisted of the following
(in thousands):
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Auto:
Held for sale $ 496,599 $ 292,629
Serviced 4,514,551 2,600,123
----------------- ------------------
5,011,150 2,892,752
Mortgage 27,431 24,903
----------------- ------------------
$5,038,581 $2,917,655
================= ==================
</TABLE>
Average managed receivables outstanding increased by 73% as a result of higher
loan purchase volume. The Company purchased $3,167.8 million of auto loans
during the nine months ended March 31, 2000, compared to purchases of $1,990.9
million during the nine months ended March 31, 1999. This growth resulted from
loan production at branches open during both periods as well as expansion of the
Company's branch network. Loan production at branch offices opened prior to
March 31, 1998 was 25% higher for the twelve months ended March 31, 2000 versus
the twelve months ended March 31, 1999. The Company operated 186 auto lending
branch offices as of March 31, 2000, compared to 168 as of March 31, 1999.
Finance charge income consisted of the following (in thousands):
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Auto $84,449 $49,798
Mortgage 1,057 1,740
----------------- ------------------
$85,506 $51,538
================= ==================
</TABLE>
The increase in finance charge income is due primarily to an increase of 70%
in average auto receivables held for sale in the nine months ended March 31,
2000 versus the nine months ended March 31, 1999. The Company's effective
yield on its auto receivables held for sale decreased to 22.6% for the nine
months ended March 31, 2000 from 22.7% for the nine months ended March 31,
1999. The effective yield is higher than the contractual rates of the
Company's auto finance contracts as a result of finance charge income earned
between the date
21
<PAGE>
the auto finance contract is originated by the automobile dealership and the
date the auto finance contract is funded by the Company.
The gain on sale of receivables consisted of the following (in thousands):
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Auto $149,654 $111,452
Mortgage 1,511 5,099
----------------- ------------------
$151,165 $116,551
================= ==================
</TABLE>
The increase in gain on sale of auto receivables resulted from the sale of
$2,925.0 million of receivables in the nine months ended March 31, 2000 as
compared to $1,920.0 million of receivables sold in the nine months ended
March 31, 1999. The gain as a percentage of the sales proceeds decreased to
5.1% for the nine months ended March 31, 2000 from 5.8% for the nine months
ended March 31, 1999 as a result of an increase in US Treasury and other
short term interest rates.
Significant assumptions used in determining the gain on sale of auto
receivables were as follows:
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Cumulative credit losses (including
deferred gains) 10.9% 11.2%
Discount rate used to estimate
present value:
Interest-only receivables from Trusts 12.0% 12.0%
Investment in Trust receivables 7.8% 7.8%
Restricted cash 7.8% 7.8%
</TABLE>
The discount rates used to estimate the present value of credit enhancement
assets are based on the relative risks of each asset type. Interest-only
receivables represent estimated future excess cash flows in the Trusts, which
involves a greater degree of risk than investments in Trust receivables and
restricted cash. Investments in Trust receivables and restricted cash represent
assets currently held by the Trustee and are senior to the interest-only
receivables for credit enhancement purposes.
Servicing fee income increased to $120.5 million, or 3.6% of average serviced
auto receivables, for the nine months ended March 31, 2000, as compared to $61.7
million, or 3.2% of average serviced auto receivables, for the nine months ended
March 31, 1999. Servicing fee income represents accretion of the present value
discount on estimated future excess cash flows from the Trusts, base servicing
fees and other fees earned by the Company as servicer of the
22
<PAGE>
auto receivables sold to the Trusts. Servicing fee income for the nine months
ended March 31, 1999 also includes a charge of $13.4 million to increase
credit loss reserves related to certain of the Company's fiscal 1997 and 1996
securitization transactions since the Company's reassessment of estimated
cumulative credit losses for these transactions exceeded the original
estimates. The growth in servicing fee income exclusive of the aforementioned
charge is attributable to the increase in average serviced auto receivables
outstanding for the nine months ended March 31, 2000 compared to the nine
months ended March 31, 1999.
COSTS AND EXPENSES:
Operating expenses as an annualized percentage of average managed receivables
outstanding decreased to 4.3% (4.2% excluding operating expenses of $2.1
million related to the mortgage business) for the nine months ended March 31,
2000, compared to 5.3% (5.0% excluding operating expenses of $6.7 million
related to the mortgage business) for the nine months ended March 31, 1999.
The ratio improved as a result of economies of scale realized from a growing
receivables portfolio and automation of loan origination, processing and
servicing functions. The dollar amount of operating expenses increased by
$46.3 million, or 40%, primarily due to the addition of auto lending branch
offices and management and auto loan processing and servicing staff.
The provision for losses increased to $11.2 million for the nine months ended
March 31, 2000 from $6.6 million for the nine months ended March 31, 1999 due
to higher average amounts of auto receivables held for sale. As a percentage
of average receivables held for sale, the provision for losses was 3.0% for
the nine months ended March 31, 2000 and 1999.
Interest expense increased to $48.3 million for the nine months ended March
31, 2000 from $25.7 million for the nine months ended March 31, 1999 due to
higher debt levels and effective interest rates. Average debt outstanding was
$649.3 million and $396.0 million for the nine months ended March 31, 2000
and 1999, respectively. The Company's effective rate of interest paid on its
debt increased to 9.9% from 8.6% as a result of increased average amounts of
senior notes outstanding which have a higher cost than the Company's other
forms of balance sheet debt.
The Company's effective income tax rate was 40.5% and 38.5% for the nine
months ended March 31, 2000 and 1999, respectively. The increase in the
effective tax rate is due to the non-deductible write-off of goodwill from
the closing of the mortgage operations.
23
<PAGE>
PRO FORMA "PORTFOLIO-BASED" EARNINGS DATA
In addition to reporting results of operations in accordance with generally
accepted accounting principles ("GAAP"), the Company has elected to present
pro forma results of operations which treat securitization transactions as
financings rather than sales of receivables. The Company refers to this
presentation as pro forma "portfolio-based" earnings data.
In its consolidated financial statements prepared in accordance with GAAP, the
Company records a gain on the sale of receivables in securitization
transactions primarily representing the present value of estimated future
excess cash flows related to the receivables sold. Future excess cash flows
consist of finance charges and fees to be collected on the receivables less
interest payable on the asset-backed securities, credit losses and expenses of
the Trusts. The Company also earns servicing fees for managing the receivables
sold.
The pro forma "portfolio-based" earnings data presents the Company's operating
results under the assumption that securitization transactions are financings
and no gain on sale or servicing fee income is recognized. Instead, finance
charges and fees are recognized over the life of the securitized receivables
as accrued and interest and other costs related to the asset-backed securities
are also recognized as accrued. Credit losses are recorded as incurred.
While the pro forma "portfolio-based" earnings data does not purport to
present the Company's operating results in accordance with GAAP, the Company
believes such presentation provides another measure for assessing the
Company's performance.
The pro forma "portfolio-based" earnings data were as follows, excluding the
effect of the mortgage charge (in thousands):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------------------- ----------------------------------
2000 1999 2000 1999
---------------- --------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Finance charge, fee and
other income $ 272,093 $160,312 $ 737,163 $ 431,346
Funding costs (107,991) (55,281) (282,742) (151,936)
---------------- ---------------- ---------------- ----------------
Net margin 164,102 105,031 454,421 279,410
Operating expenses (55,488) (42,025) (162,031) (115,760)
Credit losses (53,997) (38,118) (154,904) (103,891)
---------------- ---------------- ---------------- ----------------
Pre-tax "portfolio-based"
income 54,617 24,888 137,486 59,759
Income taxes (21,028) (9,582) (52,933) (23,007)
---------------- ---------------- ---------------- ----------------
Net "portfolio-based" income $ 33,589 $ 15,306 $ 84,553 $ 36,752
================ ================ ================ ================
Diluted "portfolio-based"
earnings per share $0.43 $0.23 $1.10 $0.55
================ ================ ================ ================
</TABLE>
24
<PAGE>
The pro-forma return on managed assets for the Company's auto business was as
follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------------------- ----------------------------------
2000 1999 2000 1999
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Finance charge, fee and
other income 19.6% 19.5% 19.5% 19.5%
Funding costs (7.8) (6.8) (7.5) (6.9)
---------------- ---------------- ---------------- ----------------
Net margin 11.8 12.7 12.0 12.6
Operating expenses (4.0) (4.9) (4.2) (5.0)
Credit losses (3.9) (4.7) (4.1) (4.8)
---------------- ---------------- ---------------- ----------------
Pre-tax return on managed
assets 3.9 3.1 3.7 2.8
Income taxes (1.5) (1.2) (1.4) (1.1)
---------------- ---------------- ---------------- ----------------
Return on managed assets 2.4% 1.9% 2.3% 1.7%
================ ================ ================ ================
</TABLE>
CREDIT QUALITY
The Company provides financing in relatively high-risk markets, and therefore,
charge-offs are anticipated. The Company records a periodic provision for
losses as a charge to operations and a related allowance for losses in the
consolidated balance sheets as a reserve against estimated losses which may
occur in the receivables held for sale portfolio prior to the sale of such
receivables in securitization transactions. The Company typically purchases
individual finance contracts for a non-refundable acquisition fee on a
non-recourse basis. Such acquisition fees are also recorded in the
consolidated balance sheets as an allowance for losses. When the Company sells
auto receivables to the Trusts, the calculation of the gain on sale of
receivables is reduced by an estimate of cumulative credit losses expected
over the life of the auto receivables sold.
The Company reviews static pool origination and charge-off relationships,
charge-off experience factors, collection data, delinquency reports, estimates
of the value of the underlying collateral, economic conditions and trends, and
other information in order to make the necessary judgments as to the
appropriateness of the assumptions for cumulative credit losses, provisions
for losses, and allowance for losses. Although the Company uses many resources
to assess the adequacy of loss reserves, there is no precise method for
estimating the ultimate losses in the receivables portfolio.
25
<PAGE>
The following table presents certain data related to the receivables portfolio
(dollars in thousands):
<TABLE>
<CAPTION>
March 31, 2000
-------------------------------------------------------------------------
Held for Sale
--------------------------------------
Auto Managed Auto
Auto Mortgage Total Serviced Portfolio
------------ ------------ ------------ --------------- ---------------
<S> <C> <C> <C> <C> <C>
Principal amount of receivables $699,450 $ 9,059 $708,509 $5,250,468 $5,949,918
=============== ===============
Allowance for losses (20,488) (20,488) $ (507,574) (a) $ (528,062)
------------ ------------ ------------ =============== ===============
Receivables, net $678,962 $ 9,059 $688,021
============ ============ ============
Number of outstanding contracts 51,788 134 462,815 514,603
============ ============ =============== ===============
Average principal amount of
outstanding contract (in dollars) $ 13,506 $67,605 $ 11,345 $ 11,562
============ ============ =============== ===============
Allowance for losses as a
percentage of receivables 2.9% 9.7% 8.9%
============ =============== ===============
</TABLE>
(a) The allowance for losses related to serviced auto receivables is factored
into the valuation of interest-only receivables from Trusts in the
Company's consolidated balance sheets.
The following is a summary of managed auto receivables which are (i) more than
30 days delinquent, but not in repossession, and (ii) in repossession (dollars
in thousands):
<TABLE>
<CAPTION>
March 31, 2000 March 31, 1999
-------------------------------- ---------------------------------
Amount Percent Amount Percent
----------------- ------------- ------------------ -------------
<S> <C> <C> <C> <C>
Delinquent contracts:
31 to 60 days $360,169 6.0% $220,022 6.2%
Greater than 60 days 123,936 2.1 80,668 2.3
----------------- ------------- ------------------ -------------
484,105 8.1 300,690 8.5
In repossession 45,089 0.8 31,431 0.9
----------------- ------------- ------------------ -------------
$529,194 8.9% $332,121 9.4%
================= ============= ================== =============
</TABLE>
In accordance with its policies and guidelines, the Company at times offers
payment deferrals to consumers, whereby the consumer is allowed to move a
delinquent payment to the end of the loan by paying a fee (approximately the
interest portion of the payment deferred). Contracts receiving a payment
deferral as an average quarterly percentage of average managed auto
receivables outstanding were 4.0% and 4.3% for the three and nine months ended
March 31, 2000, respectively, and 4.6% for both the three and nine months
ended March 31, 1999. The Company believes that payment deferrals granted
according to its policies and guidelines are an effective portfolio management
technique and result in higher ultimate cash collections from the portfolio.
26
<PAGE>
The following table presents charge-off data with respect to the Company's
managed auto receivables portfolio (dollars in thousands):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------------------- ----------------------------------
2000 1999 2000 1999
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Net charge-offs:
Held for sale $ 2,467 $ 2,285 $ 5,851 $ 5,708
Serviced 51,530 35,833 149,053 98,183
---------------- ---------------- ---------------- ----------------
$53,997 $38,118 $154,904 $103,891
================ ================ ================ ================
Net charge-offs as an annualized
percentage of average managed
auto receivables outstanding 3.9% 4.7% 4.1% 4.8%
================ ================ ================ ================
Net recoveries as a percentage of
gross repossession charge-offs 53.5% 53.6% 53.2% 51.4%
================ ================ ================ ================
</TABLE>
Delinquency and charge-off ratios typically fluctuate over time as a portfolio
matures. Accordingly, the delinquency and charge-off data above is not
necessarily indicative of delinquency and charge-off experience that could be
expected for a portfolio with a different level of seasoning.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash flows are summarized as follows (in thousands):
<TABLE>
<CAPTION>
Nine Months Ended
March 31,
-------------------------------------
2000 1999
----------------- ------------------
<S> <C> <C>
Operating activities $ 35,873 $ 30,964
Investing activities (333,493) (121,975)
Financing activities 327,249 94,770
----------------- ------------------
Net change in cash and cash equivalents $ 29,629 $ 3,759
================= ==================
</TABLE>
The Company's primary sources of cash have been cash flows from operating
activities, including cash distributions from the Trusts, borrowings under its
warehouse credit facilities, sales of auto receivables to Trusts in
securitization transactions and proceeds from issuance of debt and equity. The
Company's primary uses of cash have been purchases and originations of
receivables and funding credit enhancement requirements for securitization
transactions.
The Company required cash of $3,166.7 million and $1,976.5 million for the
purchase of auto finance contracts during the nine months ended March 31, 2000
and 1999, respectively. These purchases were funded initially utilizing
warehouse credit facilities and subsequently through the sale of auto
receivables in securitization transactions.
27
<PAGE>
In March 2000, the Company expanded its funding agreement with an
administrative agent on behalf of an institutionally managed commercial paper
conduit and a group of banks increasing the amount of structured warehouse
financing available under the agreement to $725 million from $675 million. The
Company utilizes this facility to fund auto receivables pending
securitization. The facility matures in September 2000. A total of $234.9
million was outstanding under this facility as of March 31, 2000.
The Company also has a funding agreement with an administrative agent on
behalf of an institutionally managed commercial paper conduit and a bank under
which up to $250 million of structured warehouse financing is available. The
Company utilizes this facility to fund auto receivables pending
securitization. The facility matures in September 2000. A total of $85.8
million was outstanding under this facility as of March 31, 2000.
In March 2000, the Company renewed its funding agreement with an
administrative agent on behalf of an institutionally managed commercial paper
conduit and a bank under which up to $375 million of structured warehouse
financing is available. The Company utilizes this facility to fund auto
receivables pending securitization. The facility matures in March 2001. There
were no outstanding balances under this agreement as of March 31, 2000.
The Company had a revolving credit agreement with a group of banks under which
the Company could borrow up to $90 million, subject to a defined borrowing
base. The credit agreement expired in March 2000 and was not renewed by the
Company.
In addition, in March 2000, the Company's Canadian subsidiary convertible
revolving term credit agreement with a bank was renewed and the amount of
borrowings available thereunder was increased to $30.0 million Cdn., from $20
million Cdn., subject to a defined borrowing base. The Company utilizes this
facility to fund Canadian auto lending activities. The maturity date of the
facility is March 2001. A total of $4.0 million was outstanding under the
Canadian facility at March 31, 2000.
As is customary in the Company's industry, the above warehouse credit
facilities need to be renewed on an annual basis. The Company has historically
been successful in renewing and expanding these facilities on an annual basis.
If the Company was unable to renew these facilities on acceptable terms, there
could be a material adverse effect on the Company's financial position,
results of operations and liquidity.
The Company has completed twenty auto receivable securitization transactions
through March 31, 2000. The proceeds from the transactions were primarily used
to repay borrowings outstanding under the Company's warehouse credit
facilities.
28
<PAGE>
A summary of these transactions is as follows:
<TABLE>
<CAPTION>
Original Balance at
Amount March 31, 2000
Transaction Date (in millions) (in millions)
- ----------------------- ----------------------------------- ---------------------- -----------------------
<S> <C> <C> <C>
1994-A December 1994 $ 51.0 Paid in full
1995-A June 1995 99.2 Paid in full
1995-B December 1995 65.0 Paid in full
1996-A March 1996 89.4 Paid in full
1996-B May 1996 115.9 Paid in full
1996-C August 1996 175.0 Paid in full
1996-D November 1996 200.0 23.0
1997-A March 1997 225.0 36.2
1997-B May 1997 250.0 48.9
1997-C August 1997 325.0 82.0
1997-D November 1997 400.0 122.0
1998-A February 1998 425.0 150.6
1998-B May 1998 525.0 216.3
1998-C August 1998 575.0 278.2
1998-D November 1998 625.0 339.7
1999-A February 1999 700.0 440.5
1999-B May 1999 1,000.0 725.1
1999-C August 1999 1,000.0 843.2
1999-D October 1999 900.0 807.0
2000-A January 2000 1,300.0 1,269.3
---------------------- -----------------------
$9,045.5 $5,382.0
====================== =======================
</TABLE>
In connection with securitization transactions, the Company is required to
fund certain credit enhancement levels set by the insurer of the asset-backed
securities issued by the Trusts. The Company typically makes an initial
deposit to a restricted cash account and subsequently uses excess cash flows
generated by the Trusts to either increase the restricted cash account or
repay the outstanding asset-backed securities on an accelerated basis, thus
creating additional credit enhancement through overcollateralization in the
Trusts. When the credit enhancement levels reach specified percentages of the
Trust's pool of receivables, excess cash flows are distributed to the Company.
Although the aggregate amount of excess cash flow does not change, the timing
of the Company's receipt of excess cash flow distributions is dependent on the
type of structure used. Historically, the Company has used a structure that
involved a higher initial cash deposit that resulted in receipt of excess cash
flow distributions approximately seven to nine months after the receivables
were securitized. Beginning in November 1997, the Company began to employ a
structure that involved a lower initial cash deposit and the use of
reinsurance and other alternative credit enhancements. Under this structure
the Company expects to begin to receive excess cash flow distributions
approximately 15 to 18 months after receivables are securitized.
29
<PAGE>
The reinsurance used to reduce the Company's initial cash deposit in the
structure described above has typically been arranged by the insurer of the
asset-backed securities. As of March 31, 2000, the Company had commitments
from the insurer for an additional $35.0 million of reinsurance to reduce
initial cash deposits in future securitization transactions. In addition, the
Company has a credit enhancement facility with a financial institution under
which the Company may borrow up to $225 million to fund a portion of the
initial cash deposit in future securitization transactions, similar to the
amount covered by the reinsurance described above. Borrowings under the
credit enhancement facility, which matures in October 2001, are
collateralized by the Company's credit enhancement assets. A total of $45.0
million was outstanding under this facility at March 31, 2000.
Initial deposits to restricted cash accounts were $132.8 million ($87.8
million net of borrowings under the credit enhancement facility) and $57.3
million for the nine months ended March 31, 2000 and 1999, respectively.
Excess cash flows distributed to the Company were $79.4 million and $35.2
million for the nine months ended March 31, 2000 and 1999 respectively. In
addition, the Company received $23.0 million representing a return of deposits
to restricted cash accounts during the nine months ended March 31, 1999.
Certain agreements with the insurer provide that if delinquency, default and
net loss ratios in a Trust's pool of receivables exceed certain targets, the
specified credit enhancement levels would be increased. As of March 31, 2000,
none of the Company's securitizations had delinquency, default and net loss
ratios in excess of the targeted levels.
The Company issued 9,200,000 shares of its common stock in a public offering
in August and September 1999 for net proceeds of approximately $111.5 million.
The Company operated 186 auto lending branch offices as of March 31, 2000 and
plans to open an additional nine branches through the remainder of fiscal 2000
and expand loan production capacity at existing auto lending branch offices
where appropriate. While the Company has been able to establish and grow its
auto finance business thus far, there can be no assurance that future
expansion will be successful due to competitive, regulatory, market, economic
or other factors.
As of March 31, 2000, the Company had $50.8 million in cash and cash
equivalents. The Company also had available borrowing capacity of $258.9
million under its warehouse credit facilities pursuant to the borrowing base
requirements of such agreements. The Company estimates that it will require
additional external capital for fiscal 2000 in addition to existing capital
resources in order to fund expansion of its lending activities.
The Company anticipates that such funding will be in the form of additional
securitization transactions and renewal and expansion of its warehouse credit
facilities. There can be no assurance that funding will be available to the
Company through these sources or, if available, that it will be on terms
acceptable to the Company.
30
<PAGE>
INTEREST RATE RISK
The Company's earnings are affected by changes in interest rates as a result
of its dependence upon the issuance of interest-bearing securities and the
incurrence of debt to fund its lending activities. Several factors can
influence the Company's ability to manage interest rate risk. First, auto
finance contracts are purchased at fixed interest rates, while the amounts
borrowed under warehouse credit facilities bear interest at variable rates
that are subject to frequent adjustment to reflect prevailing market interest
rates. Second, the interest rate demanded by investors in securitizations is a
function of prevailing market rates for comparable transactions and the
general interest rate environment. Because the auto finance contracts
originated by the Company have fixed interest rates, the Company bears the
risk of smaller gross interest rate spreads in the event interest rates
increase during the period between the date receivables are purchased and the
completion and pricing of securitization transactions.
The Company utilizes several strategies to minimize the risk of interest rate
fluctuations, including the use of derivative financial instruments, the
regular sale of auto receivables to the Trusts and pre-funding of
securitization transactions. Pre-funding securitizations is the practice of
issuing more asset-backed securities than the amount of receivables initially
sold to the Trust. The proceeds from the pre-funded portion are held in an
escrow account until additional receivables are sold to the Trust in amounts
up to the balance of the pre-funded escrow account. In pre-funded
securitizations, borrowing costs are locked in with respect to the loans
subsequently delivered to the Trust. However, the Company incurs an expense in
pre-funded securitizations equal to the difference between the money market
yields earned on the proceeds held in escrow prior to subsequent delivery of
receivables and the interest rate paid on the asset-backed securities
outstanding.
Derivative financial instruments are utilized to manage the gross interest
rate spread on the Company's securitization transactions. The Company sells
fixed rate auto receivables to Trusts that, in turn, sell either fixed rate or
floating rate securities to investors. The fixed rates on securities issued by
the Trusts are indexed to rates on U.S. Treasury Notes with similar average
maturities or various London Interbank Offered Rates ("LIBOR"). The Company
has periodically used Forward U.S. Treasury rate lock agreements to lock in
the indexed rate for specific anticipated securitization transactions. The
floating rates on securities issued by the Trusts are indexed to LIBOR. The
Company uses Interest Rate Swap agreements to convert the floating rate
exposures on these securities to a fixed rate. The Company utilizes these
derivative financial instruments to modify its net interest sensitivity to
levels deemed appropriate based on the Company's risk tolerance. Management
monitors the Company's hedging activities to ensure that the value of hedges,
their correlation to the contracts being hedged and the amounts being hedged
31
<PAGE>
continue to provide effective protection against interest rate risk. All
transactions are entered into for purposes other than trading.
The Company made cash payments of $0 and $5.8 million for the nine months
ended March 31, 2000 and 1999, respectively, to settle Forward U.S. Treasury
rate lock agreements. These amounts were included in the gain on sale of
receivables in securitization transactions and are recovered over time through
a higher gross interest rate spread on the related securitization transaction.
There were no outstanding Forward U.S. Treasury rate lock agreements as of
March 31, 2000.
There can be no assurance that the Company's strategies will be effective in
minimizing interest rate risk or that increases in interest rates will not
have an adverse effect on the Company's profitability.
FORWARD LOOKING STATEMENTS
The preceding Management's Discussion and Analysis of Financial Condition and
Results of Operations section contains several "forward-looking statements".
Forward-looking statements are those which use words such as "believe",
"expect", "anticipate", "intend", "plan", "may", "will", "should", "estimate",
"continue" or other comparable expressions. These words indicate future events
and trends. Forward-looking statements are the Company's current views with
respect to future events and financial performance. These forward-looking
statements are subject to many risks and uncertainties which could cause
actual results to differ significantly from historical results or from those
anticipated by the Company. The most significant risks are detailed from time
to time in the Company's filings and reports with the Securities and Exchange
Commission including the Company's Annual Report on Form 10-K for the year
ended June 30, 1999. It is advisable not to place undue reliance on the
Company's forward-looking statements. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether as a result
of new information, future events, or otherwise.
32
<PAGE>
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Because the Company's funding strategy is dependent upon the issuance of
interest-bearing securities and the incurrence of debt, fluctuations in
interest rates impact the Company's profitability. Therefore, the Company
employs various hedging strategies to minimize the risk of interest rate
fluctuations. See "Management's Discussion and Analysis - Interest Rate Risk"
for additional information regarding such market risks.
33
<PAGE>
Part II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
As a consumer finance company, the Company is subject to various consumer
claims and litigation seeking damages and statutory penalties based upon,
among other things, usury, disclosure inaccuracies, wrongful repossession,
fraud and discriminatory treatment of credit applicants, which could take the
form of a plaintiffs' class action complaint. The Company, as the assignee of
finance contracts originated by dealers, may also be named as a co-defendant
in lawsuits filed by consumers principally against dealers. The damages and
penalties claimed by consumers in these types of matters can be substantial.
The relief requested by the plaintiffs varies but includes requests for
compensatory, statutory and punitive damages. One proceeding in which the
Company is a defendant has been brought as a putative class action and is
pending in the State of California. A settlement has been reached in this
matter and preliminary court approval for the settlement obtained; following
notice to class members, the Company believes that final court approval will
be obtained and the matter concluded before June 30, 2000. The cost of the
settlement has been accrued in the Company's consolidated financial statements
as of March 31, 2000.
Two additional proceedings in which the Company is a defendant have also been
brought in the form of class action complaints. One proceeding, pending in the
State of Georgia, claims that the Company miscalculated rebates on certain
precomputed retail installment contracts in Georgia. The other proceeding,
pending in the State of Tennessee, claims that certain loan pricing structures
used by the Company and motor vehicle dealers violate various Tennessee laws.
In the opinion of management, both of these lawsuits are without merit and the
Company intends to defend vigorously.
Management believes that the Company has taken prudent steps to address the
litigation risks associated with the Company's business activities. However,
there can be no assurance that the Company will be able to successfully defend
against all such claims or that the determination of any such claim in a
manner adverse to the Company would not have a material adverse effect on the
Company's automobile finance business.
On April 8, 1999, a putative class action complaint was filed against the
Company and certain of the Company's officers and directors alleging
violations of Section 10(b) of the Securities Exchange Act of 1934 arising
from the Company's use of the cash-in method of measuring and accounting for
credit enhancement assets in the financial statements for the second, third
and fourth quarters of fiscal year 1997, fiscal year 1998 and the first
quarter of fiscal year 1999. The Company believes that its previous use of the
cash-in method of measuring and accounting for credit enhancement assets was
consistent with then current generally accepted accounting principles and
accounting practices of other finance companies. As required by the Financial
Accounting Standards Board's Special Report, "A Guide to Implementation of
Statement 125 on Accounting for Transfers and Servicing of Financial Assets
34
<PAGE>
and Extinguishment of Liabilities, Second Edition," dated December 1998 and
related statements made by the staff of the Commission, the Company
retroactively changed the method of measuring and accounting for credit
enhancement assets to the cash-out method and restated the Company's financial
statements for the three months ended September 30, 1998 and the fiscal years
ended June 30, 1998, 1997 and 1996. The Company's original motion to dismiss
this litigation was granted on December 22, 1999. On February 1, 2000, the
plaintiffs filed an amended complaint and the Company subsequently filed an
additional motion to dismiss with respect to this amended complaint. The court
granted the Company's subsequent motion to dismiss and dismissed the
litigation with prejudice on April 21, 2000. The time period for possible
appeals from these dismissals has not elapsed. In the opinion of management
this litigation is without merit, as evidenced by the court's dismissal and
the Company intends to vigorously defend against any future appeals.
In the opinion of management, the resolution of the proceedings described in
this section will not have a material adverse effect on the Company's
consolidated financial position, results of operations or liquidity.
Item 2. CHANGES IN SECURITIES
Not Applicable
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not Applicable
Item 5. OTHER INFORMATION
Not Applicable
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
11.1 Statement Re: Computation of Per Share Earnings
27.1 Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K
during the quarterly period ended March 31, 2000.
Certain subsidiaries and affiliates of the Company
filed reports on Form 8-K during the quarterly
period ended March 31, 2000 reporting monthly
information related to securitization trusts.
35
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AmeriCredit Corp.
------------------------------
(Registrant)
Date: May 12, 2000 By: /s/ Daniel E. Berce
------------------------------
(Signature)
Daniel E. Berce
Chief Financial Officer
36
<PAGE>
EXHIBIT 11.1
AMERICREDIT CORP.
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
(dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------------------- ----------------------------------
2000 1999 2000 1999
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Weighted average shares
outstanding 74,869,550 63,187,789 72,110,495 62,872,858
Incremental shares resulting
from assumed exercise of
stock options 4,158,357 3,326,578 4,434,448 3,949,568
---------------- ---------------- ---------------- ----------------
Weighted average shares and
assumed incremental shares 79,027,907 66,514,367 76,544,943 66,822,426
================ ================ ================ ================
NET INCOME $32,410 $19,505 $77,343 $52,363
================ ================ ================ ================
EARNINGS PER SHARE:
Basic $0.43 $0.31 $1.07 $0.83
================ ================ ================ ================
Diluted $0.41 $0.29 $1.01 $0.78
================ ================ ================ ================
</TABLE>
Basic earnings per share have been computed by dividing net income by
weighted average shares outstanding.
Diluted earnings per share have been computed by dividing net income by the
weighted average shares and assumed incremental shares. Assumed incremental
shares were computed using the treasury stock method. The average common
stock market prices for the period was used to determine the number of
incremental shares.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS FOR THE QUARTER ENDED MARCH 31, 2000, FILED AS
PART OF FORM 10-Q QUARTERLY REPORT FOR THE NINE MONTHS ENDED MARCH 31, 2000 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10-Q QUARTERLY REPORT FOR
THE NINE MONTHS ENDED MARCH 31, 2000.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> MAR-31-2000
<CASH> 50,818
<SECURITIES> 0
<RECEIVABLES> 708,509
<ALLOWANCES> (20,488)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 68,247
<DEPRECIATION> (21,851)
<TOTAL-ASSETS> 1,585,297
<CURRENT-LIABILITIES> 0
<BONDS> 766,045
0
0
<COMMON> 822
<OTHER-SE> 619,863
<TOTAL-LIABILITY-AND-EQUITY> 1,585,297
<SALES> 0
<TOTAL-REVENUES> 361,896
<CGS> 0
<TOTAL-COSTS> 172,531
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 11,229
<INTEREST-EXPENSE> 48,263
<INCOME-PRETAX> 129,873
<INCOME-TAX> 52,530
<INCOME-CONTINUING> 77,343
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 77,343
<EPS-BASIC> 1.07
<EPS-DILUTED> 1.01
</TABLE>
