goeasy Ltd. Reports Strongest Quarterly and Annual Performance in Company History and Announces 25% Dividend Increase

Revenue Growth of 18%, Net Income and Earnings Per Share Growth of 26%

MISSISSAUGA, ONTARIO - (Marketwired - Feb. 17, 2016) - goeasy Ltd. (TSX:GSY) ("goeasy" or the "Company"), the leading full service provider of goods and alternative financial services that improve the lives of everyday Canadians, today announced that 2015 concluded with its best quarter ever, making it the strongest year in the Company's history. The Company also announced a 25% increase in its annual dividend from $0.40 to $0.50 per share.

Q4 2015 Results

Revenue for the fourth quarter of 2015 increased to a record of $83 million, an increase of 18.3% from $70 million in the fourth quarter of 2014. Total same store sales growth in the quarter was 16.5%. The growth was driven primarily by the expansion of easyfinancial and the related growth of its consumer loans receivable portfolio which grew by $35.8 million during the fourth quarter of 2015 compared to growth of $26.5 in the fourth quarter of 2014. The gross consumer loans receivable as at December 31, 2015 was $289 million compared with $192 million as at December 31, 2014, an increase of 51%.

Operating income for the quarter was $15.0 million, up $4.7 million or 45% compared to normalized operating income of $11.3 for the fourth quarter of 2014. Net income for the quarter was $7.5 million, an increase of 26% compared with the normalized net income of $6.0 million reported in the fourth quarter of 2014. Diluted earnings per share for the quarter increased to $0.54 compared to $0.43 (normalized) for the fourth quarter of 2014. These income statement metrics represent record quarterly performance for goeasy.

"We are very pleased to have once again achieved record financial performance in the quarter," said David Ingram, goeasy's President and Chief Executive Officer. "Our strong fourth quarter was achieved through the continued growth of easyfinancial and improvements in the operating margin of easyhome Leasing. easyfinancial continues to expand by offering consumers an alternative between traditional banks and expensive payday lenders, while responsibly managing risk through industry-leading credit modeling and underwriting practices."

Other highlights for the fourth quarter of 2015 include:


  • Revenue increased by 46% for the fourth quarter of 2015 compared to the fourth quarter of 2014.
  • Gross loan originations increased by 50% from $74 million in the fourth quarter of 2014 to $111 million in the current quarter.
  • Operating margin remained strong at 32.9%.

easyhome Leasing

  • Same store revenue growth was 5.0%. This growth was offset by the impact of store sales and closures over the past 15 months resulting in a revenue decline of 3.4%.
  • Operating income for the fourth quarter of 2015 increased by $1.0 million or 15.8% to $7.0 million compared to the fourth quarter of 2014.
  • The operating margin for the fourth quarter of 2015 was 18.5%, up from the 15.4% reported for the same period in 2014.


  • Operating margin was 18.1% for the quarter, up from the normalized operating margin of 14.7% in the fourth quarter of 2014.
  • The Company's return on equity improved to 17.5% in the current quarter from 15.8% (normalized) in the fourth quarter of 2014.

Full 2015 Results

For the full year, goeasy recorded revenues of $304 million, up 17.4% compared with $259 million in 2014. Operating income for the year was $48.1 million compared with $33.4 million (normalized) in 2014, an increase of 44%.

Net income for 2015 was $23.7 million compared to normalized net income of $18.6 million for 2014, an increase of $5.1 million or 28%. Diluted earnings per share increased from $1.34 (normalized) to $1.69, an increase of 26%.

In addition to the strong financial performance during 2015, the Company also made significant progress on its strategic initiatives:

  • The Company acquired the lease rights for 45 retail locations across Canada from a former payday loan operator that allowed it to accelerate its real estate build-out for easyfinancial.
  • easyfinancial increased its maximum loan size from $5,000 to $10,000 to meet strong consumer demand for its loan offerings.
  • easyfinancial's delivery channels were enhanced beginning with the partnership with a large national furniture retailer to provide its customers with a new point-of-sale financing alternative utilizing an internally developed tablet technology solution.
  • The Company's ability to continue expanding was enhanced by increasing its total credit facilities by $100 million while reducing the interest rate. This will facilitate the growth of its gross consumer loans receivable portfolio through to 2017.
  • The profitability of the leasing operations was enhanced through the acquisition of 14 Canadian leasing stores from a large U.S. based merchandise leasing company.
  • The Company's rebranding was completed with the change of its corporate name from easyhome Ltd. to goeasy Ltd., reflecting the evolution and growth in the business.
  • The Company completed a relaunch of all of its transactional websites to improve the customer experience and increase the conversion rates of visitors to applications.

"2015 was the fourteenth consecutive year of growing revenues and delivering profits," said Mr. Ingram. "Since 2001, total revenue has seen a compounded annual growth rate of 11.5% while net income has grown from a loss of $1.9 million in 2001 to net income of $23.7 million in 2015. My thanks go out to our entire team who work tirelessly to satisfy the needs of our customers who are underserviced by traditional retail and financial organizations and require alternatives to help them improve their lives."


goeasy's strategic focus continues to be on evolving its delivery channels to better meet the needs of its customers, expanding the size and scope of easyfinancial and executing with efficiency and effectiveness.

"We are starting 2016 on exceptionally strong footing and expect continued growth," said Mr. Ingram. "Economic conditions remain uncertain in several parts of the country. Although markets such as Alberta are likely to see negative impacts due to the difficulties in the oil sector, we are benefitting from our larger exposure in Ontario and British Colombia which are showing positive indications. Overall, we are confident that the prior investments we have made in technology, infrastructure, risk management and people will allow us to continue growing responsibly while proactively managing credit risk."

The Company included annual targets for 2016 and three year targets that it is working to achieve by the end of 2018 in its previous press release announcing its results for the third quarter of 2015. These targets remain unchanged.

"The progress made on all fronts during the last few years has positioned the Company for significant earnings expansion and unencumbered loan book growth for the next few years," Mr. Ingram commented. "Our plans for 2016 are focused on completing existing IT projects, accelerating new customer originations, particularly through the indirect channel, and achieving efficiency and effectiveness as the business continues to expand."

Dividend Increase

In consideration of the improved earnings achieved in 2015 compared to the prior year and the Company's confidence of its continued growth and access to capital going forward, the Board of Directors has approved an increase to the quarterly dividend from $0.10 per share payable to $0.125 per share. As such, the Board of Directors has approved a quarterly dividend of $0.125 per share payable on April 8, 2016 to the holders of common shares of record as at the close of business on March 25, 2016.

Forward-Looking Statements

This press release includes forward-looking statements about goeasy, including, but not limited to, its business operations, strategy and expected financial performance and condition. Forward- looking statements include, but are not limited to, those with respect to the estimated number of new locations to be opened, targets for growth of the consumer loans receivable portfolio, annual revenue growth targets, strategic initiatives, new product offerings and new delivery channels, anticipated cost savings, planned capital expenditures, anticipated capital requirements, liquidity of the Company, plans and references to future operations and results and critical accounting estimates. In certain cases, forward-looking statements that are predictive in nature, depend upon or refer to future events or conditions, and/or can be identified by the use of words such as 'expects', 'anticipates', 'intends', 'plans', 'believes', 'budgeted', 'estimates', 'forecasts', 'targets' or negative versions thereof and similar expressions, and/or state that certain actions, events or results 'may', 'could', 'would', 'might' or 'will' be taken, occur or be achieved.

Forward-looking statements are based on certain factors and assumptions, including expected growth, results of operations and business prospects and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company's operations, economic factors and the industry generally, as well as those factors referred to in the Company's December 31, 2015 Management Discussion and Analysis in the section entitled "Risk Factors". There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those expressed or implied by forward-looking statements made by the Company, due to, but not limited to, important factors such as the Company's ability to enter into new lease and/or financing agreements, collect on existing lease and/or financing agreements, open new locations on favourable terms, secure new franchised locations, purchase products which appeal to customers at a competitive rate, respond to changes in legislation, react to uncertainties related to regulatory action, raise capital under favourable terms, manage the impact of litigation (including shareholder litigation), control costs at all levels of the organization and maintain and enhance the system of internal controls. The Company cautions that the foregoing list is not exhaustive.

The reader is cautioned to consider these and other factors carefully and not place undue reliance on forward-looking statements, which may not be appropriate for other purposes. The Company is under no obligation (and expressly disclaims any such obligation) to update or alter the forward-looking statements whether as a result of new information, future events or otherwise, unless required by law.

About goeasy

As at December 31, 2015, the Company operated 184 easyhome Leasing stores (including 26 franchises and 3 consolidated franchise locations) and 202 easyfinancial locations.

goeasy Ltd. is the leading full service provider of goods and alternative financial services that improve the lives of everyday Canadians. Today,goeasy Ltd. serves its customers through two key operating divisions, easyhome Leasing and easyfinancial. easyhome Leasing is Canada's largest lease-to-own company, offering brand-name household furniture, appliances and electronics to consumers under weekly or monthly leasing agreements through both corporate and franchise stores. easyfinancial is the leading provider of alternative financial services, offering consumer loans between $500-$10,000, and is supported by a strong central credit adjudication process and industry leading risk analytics.easyfinancial also operates an indirect lending channel, offering loan products to consumers at the point-of-sale of third party merchants. Both operating divisions of goeasy Ltd. offer the highest level of customer service and enable customers to transact through a national store and branch network of over 180 easyhome Leasing and 200 easyfinancial locations across Canada and through its online and mobile eCommerce enabled platforms.

goeasy Ltd. is listed on the TSX under the symbol 'GSY'. For more information, visit www.goeasy.com.

goeasy Ltd.
(expressed in thousands of Canadian dollars except earnings per share)
  Three Months Ended   Years Ended  
  December 31,   December 31,   December 31,   December 31,  
  2015   2014   2015   2014  
Lease revenue 36,563   37,445   146,692   151,068  
Interest income 29,534   19,615   100,814   64,237  
Other 16,778   12,982   56,767   43,845  
  82,875   70,042   304,273   259,150  
Salaries and benefits 22,097   21,163   85,658   78,012  
Stock based compensation 1,149   1,814   4,753   6,264  
Advertising and promotion 2,620   2,579   10,689   9,089  
Bad debts 13,473   6,757   41,933   24,264  
Occupancy 7,961   7,244   31,545   28,147  
Other 6,513   5,692   25,547   23,365  
Restructuring and other items -   (1,225 ) -   (1,225 )
  53,813   44,024   200,125   167,916  
Depreciation of lease assets 11,901   12,500   47,407   49,425  
Depreciation of property and equipment 1,580   1,229   5,545   4,789  
Amortization of intangible assets 674   621   3,138   2,133  
Impairment, net (84 ) 126   6   294  
  14,071   14,476   56,096   56,641  
Total operating expenses 67,884   58,500   256,221   224,557  
Operating income 14,991   11,542   48,052   34,593  
Finance costs 4,605   2,907   15,334   8,800  
Income before income taxes 10,386   8,635   32,718   25,793  
Income tax expense (recovery)                
Current 3,159   153   8,157   8,774  
Deferred (305 ) 1,370   833   (2,729 )
  2,854   1,523   8,990   6,045  
Net income 7,532   7,112   23,728   19,748  
Basic earnings per share 0.56   0.53   1.75   1.47  
Diluted earnings per share 0.54   0.51   1.69   1.42  
goeasy Ltd.
(expressed in thousands of Canadian dollars)
  As At As At
  December 31, December 31,
  2015 2014
Cash 11,389 1,165
Amounts receivable 13,000 16,508
Prepaid expenses 2,446 1,971
Consumer loans receivable 270,961 180,693
Lease assets 60,753 64,526
Property and equipment 18,689 16,915
Deferred tax assets 5,913 6,725
Intangible assets 14,041 11,006
Goodwill 21,310 19,963
TOTAL ASSETS 418,502 319,472
Revolving operating facility - 1,756
Accounts payable and accrued liabilities 23,617 32,837
Income taxes payable 700 3,042
Dividends payable 1,341 1,133
Deferred lease inducements 1,922 2,603
Unearned revenue 3,982 3,978
Provisions 582 314
Term loan 210,299 119,841
TOTAL LIABILITIES 242,443 165,504
Shareholders' equity    
Share capital 81,725 80,364
Contributed surplus 9,852 6,458
Accumulated other comprehensive income 969 694
Retained earnings 83,513 66,452

SOURCE goeasy Ltd.


David Ingram
goeasy Ltd.
President and Chief Executive Officer
(905) 272-2788
(905) 272-9886 (FAX)

Steve Goertz
goeasy Ltd.
Executive Vice President and Chief Financial Officer
(905) 272-2788
(905) 272-9886 (FAX)


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goeasy Ltd. is the leading full service provider of goods and alternative financial services that improve the lives of everyday Canadians.


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