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goeasy Ltd. goeasy Ltd. Reports Record Results for the Second Quarter & Announces Enhancements to Securitization Facility August 5 , 2021 Loan Portfolio of $ 1.80 billion , up 58 % Revenue of $ 202 million , up 34 % Net Charge Off Rate of 8.2 % , down from 10.0 % Adjusted Quarterly Net Income of $ 43.7 million , up 50 % Adjusted Quarterly Diluted Earnings per Share of $ 2.61 , up 38 % Securitization Facility Increased from $ 200 million to $ 600 million , with Interest Reduction of 110 bps MISSISSAUGA , Ontario , Aug. 05 , 2021 ( GLOBE NEWSWIRE ) goeasy Ltd. ( TSX : GSY ) , ( " goeasy " or the " Company " ) , a leading full - service provider of goods and alternative financial services , today reported results for the second quarter ended June 30 , 2021 and announced a commitment from National Bank Financial Markets to increase its existing revolving securitization warehouse facility ( the " Securitization Facility " ) from $ 200 million to $ 600 million , including a new 3 - year term extension , improved eligibility criteria and a 110 basis point reduction in the interest rate payable on advances from 1 - month Canadian Dollar Offered Rate ( " CDOR " ) plus 295 bps to CDOR plus 185 bps . Second Quarter Results During the quarter , the Company experienced an increased level of demand within its direct - to - consumer lending channels , aided by strong growth in its point - of - sale finance channel . Increased originations and loan growth , complemented by improved credit performance and the April 30 , 2021 closing of the previously announced acquisition of LendCare Holdings Inc. ( " LendCare " ) , led to record financial results . The Company generated a record $ 379 million in total loan originations in the second quarter , up 122 % compared to the $ 171 million produced in the second quarter of 2020 , and a sequential increase of 39 % from the $ 272 million in loan originations in the first quarter of 2021. In addition to the approximately $ 445 million gross consumer loan portfolio acquired through the acquisition of LendCare , the increase in loan origination volume led to organic growth in the loan portfolio of an additional $ 74 million during the quarter , resulting in a total gross consumer loan receivable portfolio of $ 1.80 billion , up 58 % from $ 1.13 billion as at June 30 , 2020. The growth in consumer loans led to an increase in revenue , which was a record $ 202 million in the quarter , up 34 % over the same period in 2020 . During the quarter , the Company also continued to experience strong credit and payment performance . When combined with the amalgamation of the structurally lower credit risk of the LendCare portfolio , the net charge off rate for the second quarter was 8.2 % , compared to 10.0 % in the second quarter of 2020. As a result of the continued improvement in underlying credit quality , the improving economic recovery , and the amalgamation of LendCare , the Company reduced its overall allowance for future credit losses to 7.90 % from 9.88 % in the prior quarter . Operating income for the second quarter of 2021 was $ 56.1 million , up 4 % from $ 54.0 million in the second quarter of 2020 , while the operating margin for the second quarter was 27.7 % , down from 35.8 % in the prior year . After adjusting for items related to the acquisition of LendCare and an unrealized fair value loss on investments recorded in the quarter , the Company reported record adjusted operating income of $ 79.9 million , up $ 25.9 million or 48 % over the second quarter of 2020. Adjusted operating margin for the second quarter was 39.5 % , up from 35.8 % in the prior year . Net income in the second quarter was $ 19.5 million , compared to $ 32.5 million in the same period of 2020 , which resulted in diluted earnings per share of $ 1.16 , compared to $ 2.11 in the second quarter of 2020. After adjusting for non - recurring and unusual items on an after - tax basis , including $ 8.6 million of transaction and integration costs related to the acquisition of LendCare , $ 1.6 million in amortization of acquired intangible assets , a $ 10.5 million day one IFRS loss provision related to the acquired Lend Care loan portfolio and a $ 3.5 million unrealized fair value loss on investments recorded in the second quarter of 2021 , adjusted net income was a record $ 43.7 million , up 50 % from $ 29.1 million in 2020 , resulting in adjusted diluted earnings per share of $ 2.61 , up 38 % from $ 1.89 in the second quarter of 2020 . Return on equity during the quarter was 12.0 % , compared to 37.0 % in the second quarter of 2020. After adjusting for the non - recurring and unusual items previously noted , adjusted return on equity was 26.9 % in the quarter , compared to adjusted return on equity of 33.1 % in the same period of 2020 . " The second quarter was highlighted by a significant increase in loan originations , continued strength in the credit performance of our portfolio , and the expansion of our point - of - sale lending channel through the acquisition of LendCare , " said Jason Mullins , goeasy's President and Chief Executive Officer , " As we have now entered a period of accelerated growth , revenues lifted 34 % , while adjusted diluted earnings per share rose 38 % . To support our future growth , we were also pleased to announce a $ 400 million increase to our securitization facility , supplemented by a material pricing reduction to a variable coupon rate of approximately 2.3 % , " Mr. Mullins concluded , " I'd like to extend my sincere appreciation to the entire goeasy team for successfully navigating through another period of pandemic related disruption and for the excellent job integrating our new colleagues at LendCare into the Company . " Other Key Second Quarter Highlights easyfinancial ( including the acquired LendCare portfolio ) Revenue of $ 165 million , up 43 % • 33 % of the loan portfolio secured , up from 11.1 %