CURO Group Holdings Corp.

Q3 2023 revenue was $168 million, slightly above the prior quarter. Net loss from continuing operations was $34 million, or $0.81 per diluted share. Net charge-offs were $55 million, improving by $2 million sequentially, and the reported net charge-off rate improved to 17.7% from 18.8% in Q2. Net revenue post provision expense was $119 million versus $103 million in Q2, pretax loss post provision was $33 million versus $54 million, and operating expenses were $94 million, including $6.5 million of non-recurring charges. Pre-provision income was $16 million, up $3 million sequentially. For Q4 2023, management expects receivables of $1.26 billion to $1.28 billion, revenue of about $165 million to $175 million, net charge-offs of 16.5% to 18.5%, operating expenses of $85 million to $95 million, and cost of funds of approximately $60 million. For 2024, CURO expects receivables growth of 8% to 12%, net interest margin post charge-offs excluding recourse interest of 26% to 28%, and an expense run rate in line with Q4 2023 annualized expenses. It also expects unrestricted cash of $90 million to $140 million at the end of every quarter.

Doug Clark framed Q3 as a successful quarter because CURO completed the Flexiti sale and finished its business transformation, leaving the company focused on core direct lending in the U.S. and Canada. He emphasized responsible growth, saying the loan portfolio grew 2% sequentially and 8% annualized, and pointed to the U.S. system conversion as a major efficiency milestone that should help branch management, servicing, and loan balance growth. His tone was constructive but measured, with repeated emphasis on credit discipline, expense control, and readiness to adjust underwriting if consumer conditions change.

Izzy Dawood highlighted that revenue was $168 million, net loss from continuing operations was $34 million, and net charge-offs improved to $55 million, or 17.7%, from 18.8% in Q2. She said operating expenses were $94 million, including $6.5 million of non-recurring charges, and noted that excluding those charges the OpEx receivables ratio would have been lower by 210 basis points to 28.3%. On liquidity, she said unrestricted cash is expected to be $90 million to $140 million at year-end, with another $45 million to $50 million of liquidity expected from escrow true-up, a tax refund, and a higher Canadian advance rate, plus $65 million of additional U.S. facility capacity in Q4 2023. She also said CURO expects a roughly $38 million tax refund in the second half of 2024 after filing 2023 returns.

Analysts focused on why credit metrics improved, whether the trend was due to execution or a better macro backdrop, and how U.S. and Canada differed. Doug Clark said it was a mix of tighter underwriting, centralized collections, new payment solutions, and servicing changes in both markets; he also pointed out that U.S. unemployment remains below the national average in most states where CURO operates, while Canada has seen some increase in consumer proposals but still below pre-COVID levels. Another question addressed ABS and lending facility changes, and Izzy Dawood explained the near-term goal is to create capacity for secured loan growth, while next year CURO expects to move toward a new U.S. direct lending facility split between secured and unsecured loans.