Nicholas Financial Earns 35 Cents Per Share

Nicholas Financial ($NICK) reported earnings of 35 cents per share:

CLEARWATER, Fla., Oct. 31, 2013 (GLOBE NEWSWIRE) — Nicholas Financial, Inc. (NICK) announced that for the three months ended September 30, 2013 net earnings decreased 16% to $4,317,000 as compared to $5,150,000 for the three months ended September 30, 2012. Per share diluted net earnings decreased 17% to $0.35 as compared to $0.42 for the three months ended September 30, 2012. Revenue increased 1% to $20,949,000 for the three months ended September 30, 2012 as compared to $20,705,000 for the three months ended September 30, 2012.

For the six months ended September 30, 2013 net earnings decreased 5% to $10,017,000 as compared to $10,558,000 for the six months ended September 30, 2012. Per share diluted net earnings decreased 6% to $0.82 as compared to $0.87 for the six months ended September 30, 2012. Revenue increased 1% to $41,425,000 for the six months ended September 30, 2013 as compared to $41,133,000 for the six months ended September 30, 2012.

“Our results for the three months ended September 30, 2013 were adversely affected by a non-cash charge related to the change in fair value of interest rate swap agreements, an increase in operating expenses as a percentage of finance receivables, net, and an increase in the net charge-off rate,” stated Peter L. Vosotas, Chairman and CEO. “We continue to develop additional markets and expect to open between 1-3 new branch locations during the remainder of our current fiscal year, which ends March 31, 2014.”

This was much less than I expected. I saw them earnings 45 cents per share, give or take.

I’m surprised by the sharp rise in operating costs. One year ago, operating costs were 60.2 cents per share. Last quarter that rose to 65.6 cents per share. This is in the context of revenue-per-share being almost identical to one year ago.

The provision for credit losses rose from 26.8 cents last year to 32.3 cents this year. The difference between credit losses and operating costs knocks about 11 cents per share off NICK’s pre-tax income. The stock is currently down about 4%.

Posted by on October 31st, 2013 at 9:46 am


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