goeasy Ltd. Reports Results for the Third Quarter Ended September 30, 2015

goeasy Ltd. Reports Results for the Third Quarter Ended September 30, 2015

Record Revenue and Earnings Revenue +19%, Net Income +80%, Earnings Per Share +80%

MISSISSAUGA, ONTARIO - (Marketwired - Nov. 3, 2015) - 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 its results for the third quarter ended September 30, 2015.

Q3 2015 Results

Revenue for the third quarter of 2015 increased to a record of $78 million, an increase of 19.0% from $66 million in the third quarter of 2014. Total same store sales growth in the quarter was 18.6%. The growth was driven primarily by the expansion of easyfinancial and the related growth of its consumer loans receivable portfolio which grew by $22.7 million during the third quarter of 2015. The gross consumer loans receivable as at September 30, 2015 was $254 million compared with $166 million as at September 30, 2014, an increase of 53%.

Operating income for the quarter was $12.9 million, up $5.5 million or 74% compared to the third quarter of 2014. Net income for the quarter was $6.3 million, an increase of 80% compared with $3.5 million reported in the third quarter of 2014. Diluted earnings per share for the quarter increased to $0.45 compared to $0.25 for the third quarter of 2014. These income statement metrics represent record quarterly performance for goeasy.

"We are pleased with the record financial performance achieved in the quarter," said David Ingram, goeasy's President and Chief Executive Officer. "The previous investments that we made in technology, infrastructure, risk management, staff and brand positioning are now delivering the expected results. In addition to the improving financial performance, we completed several key strategic activities during the third quarter of 2015. We are confident that these will drive additional benefits in future quarters as we continue to grow and execute against our stated strategy."

The strategic activities completed during the third quarter of 2015 were as follows:

  • easyfinancial's delivery channels were enhanced through the partnership with Leon's Furniture Ltd. ("Leons") to provide customers of Leon's 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 leasing operations were made more efficient through the acquisition of 14 leasing stores from Rent-A-Center, Inc.
  • The Company's rebranding was completed with the change in the corporate name from easyhome Ltd. to goeasy Ltd., reflecting the evolution and growth in the business as it moves from a name that was aligned with the legacy leasing business to a corporate name that encompasses all of the Company's business units and its ambition to add new goeasy brands as it executes towards its strategic goals.

Other highlights for the third quarter of 2015 include:


  • Revenue for easyfinancial increased by 47% for the third quarter of 2015 compared to the third quarter of 2014.
  • Gross loan originations increased by 41% from $58 million in the third quarter of 2014 to $82 million in the current quarter.
  • Operating margin of 32.4% for the third quarter of 2015 was up from 29.6% reported for the same period in 2014.

easyhome Leasing

  • Revenue for easyhome Leasing was relatively unchanged from the third quarter of 2014.
  • Same store revenue growth was 8.0%.
  • The operating margin of easyhome Leasing for the third quarter of 2015 was 15.6%, up from the 11.2% reported for the same period in 2014.


  • Operating margin was 16.5% for the quarter, up from 11.3% in the third quarter of 2014.

Nine Months Results

For the first nine months of the year, goeasy recorded revenues of $221 million, up 17.1% compared with $189 million in the first nine months of 2014. Operating income for the period was $33 million compared with $23 million in the first nine months of 2014, an increase of 43% while net income increased by $3.5 million or 28%. Diluted earnings per share increased from $0.91 to $1.15, an increase of 26%.


The Company's 2015 targets remain unchanged from the targets detailed in its earnings release for the second quarter of 2015.
The Company has established the following targets for 2016:

  • open 10 - 20 new easyfinancial locations
  • easyfinancial gross consumer loans receivable portfolio growing to $360 - $390 million by year end
  • easyfinancial operating margins for 2016 of 32 - 35%.

Based on these assumptions, the Company expects total revenue growth of 16 - 20% for 2016. The achievement of these targets by the Company, however, is predicated on a number of factors, including the pace of expansion of easyfinancial.

In addition to specific targets for the 2015 and 2016 fiscal years, the Company has established a number of three year targets that it is working to achieve by the end of 2018.

  • 220 - 240 easyfinancial locations operating by the end of 2018
  • easyfinancial gross consumer loans receivable portfolio growing to $500 million
  • easyfinancial margins of 35%

"The progress made on all fronts during the last few years has positioned the Company for significant EPS expansion and unencumbered loan book growth for the next few years," Mr. Ingram commented. "Our plans for next year 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."

The Board of Directors has approved a quarterly dividend payment of $0.10 per share payable on January 8, 2016 to the holders of common shares of record as at the close of business on December 24, 2015.

Forward-Looking Statements

This new 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 the Company's December 31, 2014 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 September 30, 2015, the Company operated 186 easyhome Leasing stores (including 25 franchises and 4 consolidated franchise locations) and 201 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)

  As At   As At
  September 30,   December 31,
  2015   2014
Cash 22,261   1,165
Amounts receivable 14,321   16,508
Prepaid expenses 3,002   1,971
Income taxes receivable 1,260   -
Consumer loans receivable 237,907   180,693
Lease assets 60,523   64,526
Property and equipment 19,437   16,915
Deferred tax assets 5,603   6,725
Intangible assets 13,884   11,006
Goodwill 21,310   19,963
TOTAL ASSETS 399,508   319,472
Revolving operating facility -   1,756
Accounts payable and accrued liabilities 25,490   32,837
Income taxes payable -   3,042
Dividends payable 1,339   1,133
Deferred lease inducements 2,122   2,603
Unearned revenue 3,625   3,978
Provisions 584   314
Term loan 197,515   119,841
TOTAL LIABILITIES 230,675   165,504
Shareholders' equity      
Share capital 81,481   80,364
Contributed surplus 8,760   6,458
Accumulated other comprehensive income 1,113   694
Retained earnings 77,479   66,452

goeasy Ltd.



(expressed in thousands of Canadian dollars except earnings per share)

  Three Months Ended   Nine Months Ended  
  September 30,   September 30,   September 30,   September 30,  
  2015   2014   2015   2014  
Lease revenue 37,256   37,041   110,129   113,623  
Interest income 26,481   17,107   71,280   44,622  
Other 14,246   11,380   39,989   30,863  
  77,983   65,528   221,398   189,108  
Salaries and benefits 21,328   19,107   63,561   56,849  
Stock based compensation 1,009   1,182   3,604   4,450  
Advertising and promotion 2,754   3,174   8,069   6,510  
Bad debts 10,856   7,252   28,460   17,507  
Occupancy 7,995   6,994   23,584   20,903  
Other 6,671   6,080   19,034   17,673  
  50,613   43,789   146,312   123,892  
Depreciation of lease assets 12,248   12,564   35,506   36,925  
Depreciation of property and equipment 1,326   1,215   3,965   3,560  
Amortization of intangible assets 880   526   2,464   1,512  
Impairment, net 44   26   90   168  
  14,498   14,331   42,025   42,165  
Total operating expenses 65,111   58,120   188,337   166,057  
Operating income 12,872   7,408   33,061   23,051  
Finance costs 3,978   2,535   10,729   5,893  
Income before income taxes 8,894   4,873   22,332   17,158  
Income tax expense (recovery)                
Current 1,960   1,708   4,998   8,621  
Deferred 678   (305 ) 1,138   (4,099 )
  2,638   1,403   6,136   4,522  
Net income 6,256   3,470   16,196   12,636  
Basic earnings per share 0.46   0.26   1.19   0.94  
Diluted earnings per share 0.45   0.25   1.15   0.91  

SOURCE goeasy Ltd.


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

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



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