OppFi Inc
For the period ended Jun 30, 2024. Filed Aug 8, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 8, 2024
OPFI$6.17-1.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-09.
0001818502-24-000009
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-08.
0001818502-24-000015
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 116 previous paragraphs and 152 current paragraphs.
58 unchanged; 50 reworded; 26 added; 7 removed; 1 previous and 18 current paragraphs rearranged.
Tables are not compared: 13 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (26)
Current report
•Ending receivables decreased 2.7% to $387.1 million from $397.8 million as of June 30, 2024 and 2023, respectively;
Current report
•Total revenue increased 3.1% to $126.3 million from $122.5 million for the three months ended June 30, 2024 and 2023, respectively;
Current report
•Net income of $27.7 million for the three months ended June 30, 2024, an increase of $9.6 million from $18.1 million for the three months ended June 30, 2023; and
Current report
Dividend Paid
Current report
Share Repurchase Program
Current report
Bitty Purchase Agreement
Current report
On July 31, 2024, we entered into a Securities Purchase Agreement, dated as of July 31, 2024, to acquire 35% of the outstanding equity securities of Bitty Holdings, LLC (“Bitty”), a credit access company that offers revenue-based financing and other working capital solutions. The acquisition closed on July 31, 2024 (the “Closing Date”). The aggregate consideration paid in connection with the acquisition consisted of (i) a cash payment of approximately $15.3 million and (ii) 734,851 OppFi Units, valued at approximately $2.7 million.
Current report
Pursuant to the Securities Purchase Agreement, one of our subsidiaries has (a) the right to purchase an additional 30% of the outstanding equity securities of Bitty within a specific time period from the date that is three years from the Closing Date, and (b) the right to purchase all remaining equity securities of Bitty within a specific time period from the date that is six years from the Closing Date.
Current report
Comparison of the six months ended June 30, 2024 and 2023
Current report
Total Revenue
Current report
Total revenue increased by $10.8 million, or 4.4%, to $253.6 million for the six months ended June 30, 2024 from $242.9 million for the six months ended June 30, 2023. The increase was due to higher average receivables balances throughout the period, a higher average statutory rate for the loans in the portfolio, and stronger payment activity driving a higher yield on the balances.
Current report
Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $3.9 million to $30.8 thousand for the six months ended June 30, 2024 from $3.9 million for the six months ended June 30, 2023. The decrease is largely attributed to very few remaining active SalaryTap finance receivables during the six months ended June 30, 2024, while provision for credit losses was increased during six months ended June 30, 2023 to account for the then-impending closure of OppFi Card finance receivables.
Current report
Net Revenue
Current report
Net revenue is equal to total revenue less the change in fair value and provision for credit losses on finance receivables. Total net revenue increased by $17.7 million, or 13.5%, to $149.5 million for the six months ended June 30, 2024 from $131.8 million for the six months ended June 30, 2023. This increase was due to both the increase in total revenue and the decrease in change in fair value and provision for credit losses on finance receivables.
Current report
Expenses
Current report
Expenses increased by $5.0 million, or 4.6%, to $114.7 million for the six months ended June 30, 2024, from $109.7 million for the six months ended June 30, 2023. The increase in expenses was primarily driven by a one-time expense associated with the exit activities from the OppFi Card product as well as a one-time adjustment as a result of the reclassification of OppFi Card assets from held for sale to held for investment at amortized cost that offset expenses for the six months ended June 30, 2023. The increase was partially offset by lower direct marketing spend expense resulting from a shift towards relatively lower-cost loans, reduced payment processing fees related to a renegotiation, and lower capitalized technology amortization expense. Despite the overall increase in expenses for the six months ended June 30, 2024, expenses as a percent of total revenue was flat year over year at 45.2%.
Current report
Income from Operations
Current report
Other Income
Current report
Income Before Income Taxes
Current report
Income Tax Expense
Current report
OppFi recorded a provision for income taxes of $1.3 million for the six months ended June 30, 2024 and $0.8 million for the six months ended June 30, 2023. This increase is largely attributed to OppFi Inc.’s increasing ownership in OppFi-LLC.
Current report
Net Income
Current report
Net income increased by $15.8 million, or 71.8%, to $37.8 million for the six months ended June 30, 2024 from $22.0 million for the six months ended June 30, 2023 for the reasons stated above.
Current report
Diluted Earnings per Share
Current report
Comparison of the three and six months ended June 30, 2024 and 2023
Current report
(a) For the six months ended June 30, 2024, other addbacks and one-time expenses, net of $9.1 million included $3.1 million in stock compensation expenses, a $2.9 million expense related to OppFi Card’s exit activities, $1.2 million in expenses related to legal matters, $1.1 million in severance expenses, and $0.8 million in expenses related to corporate development. For the six months ended June 30, 2023, other addbacks and one-time expenses, net of $3.9 million included a $(3.0) million addback from the reclassification of OppFi Card finance receivables from assets held for sale to assets held for investment at amortized cost, a $3.8 million expense related to provision for credit losses on the OppFi Card finance receivables, $2.0 million in stock compensation expenses, $0.6 million in severance expenses, $0.4 million in expenses related to corporate development, and $0.1 million in retention expenses.
Removed paragraphs (7)
Previous report
•Ending receivables increased 0.5% to $371.4 million from $369.7 million as of March 31, 2024 and 2023, respectively;
Previous report
•Total revenue increased 5.8% to $127.3 million from $120.4 million for the three months ended March 31, 2024 and 2023, respectively;
Previous report
•Net income of $10.1 million for the three months ended March 31, 2024, an increase of $6.2 million from $3.9 million for the three months ended March 31, 2023; and
Previous report
In addition to the special dividend payable to Class A common stockholders, the Board approved a $0.12 per unit special distribution that was paid on April 29, 2024 to holders of record of Class A common units of OppFi-LLC as of the close of business on April 19, 2024. Distributions with respect to earnout units of OppFi-LLC will not be payable to the holders thereof unless such units vest prior to expiration.
Previous report
Ending receivables increased to $371.4 million as of March 31, 2024 from $369.7 million as of March 31, 2023. The 0.5% increase was primarily driven by a higher beginning receivables balance to begin the year in 2024 relative to 2023.
Previous report
(a) Beginning with the quarter ended March 31, 2024, for all periods presented, the company reclassified certain expenses that were previously included in general, administrative, and other expenses to customer operations expenses.
Previous report
(1) In April 2024, Gray Rock SPV, LLC entered into an amendment to its revolving credit agreement, which, among other things, extended the maturity date from April 15, 2025 to October 16, 2026 and increased the applicable margin rate from 7.25% to 7.45%.
Reworded paragraphs (50)
Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited consolidated financial statements and related notes thereto included elsewhere in the Quarterly Report on Form 10-Q. This discussion contains forward-looking statements that involve risks and uncertainties. You should review the sections titled “Cautionary Note Concerning Factors That May Affect Future Results” and “Risk Factors” of this Form 10-Q and our Annual Report on Form 10-K, filed with the U.S Securities and Exchange Commission on March 27, 2024 (“2023 Annual Report”), for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described or implied by the forward-looking statements contained in the following discussion and analysis.
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements that involve risks and uncertainties. You should review the sections titled “Cautionary Note Concerning Factors That May Affect Future Results” and “Risk Factors” of this Form 10-Q and our Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission on March 27, 2024 (“2023 Annual Report”), for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described or implied by the forward-looking statements contained in the following discussion and analysis.
Previous wording
Unless the context otherwise requires, all references in this section to “OppFi” or the “Company” refer OppFi-LLC and its subsidiaries prior to the Closing, or to OppFi Inc. and its subsidiaries from and after the Closing. See Item 1. “Organization and Nature of Operations” for more information.
Current wording
Unless the context otherwise requires, all references in this section to “OppFi” or the “Company” refer to OppFi-LLC and its subsidiaries prior to the Closing, or to OppFi Inc. and its subsidiaries from and after the Closing. See Item 1. “Organization and Nature of Operations” for more information.
Previous wording
•Basic and diluted earnings per share (“EPS”)of $0.29 and $0.10, respectively, for thethree months ended March 31, 2024;
Current wording
•Basic and diluted earnings per share (“EPS”)of $0.16 and $0.16, respectively, for thethree months ended June 30, 2024;
Previous wording
•Adjusted earnings per share (“Adjusted EPS”)(1) of $0.10 for thethree months ended March 31, 2024, an increase of$0.05 from $0.05 for the three months ended March 31, 2023;
Current wording
•Adjusted earnings per share (“Adjusted EPS”)(1) of $0.29 for thethree months ended June 30, 2024, an increase of$0.10 from $0.19 for the three months ended June 30, 2023;
Previous wording
•Net originations increased 2.4% to $163.5 million from $159.6 million for the three months ended March 31, 2024 and 2023, respectively;
Current wording
•Net originations increased 2.4% to $205.5 million from $200.6 million for the three months ended June 30, 2024 and 2023, respectively;
Previous wording
•Adjusted net income (“Adjusted Net Income”)(1) of $8.8 million for the three months ended March 31, 2024, an increase of $4.9 million from $3.9 million for the three months ended March 31, 2023.
Current wording
•Adjusted net income (“Adjusted Net Income”)(1) of $24.8 million for the three months ended June 30, 2024, an increase of $8.9 million from $15.9 million for the three months ended June 30, 2023.
Previous wording
On April 4, 2024, the Company’s Board of Directors (the “Board”) declared a special common stock dividend of $0.12 per share on our Class A common stock, which was paid on May 1, 2024 to stockholders of record as of the close of business on April 19, 2024.
Current wording
On May 1, 2024, we paid a dividend of $0.12 per share ($2.4 million in the aggregate) to stockholders of record of our Class A Common Stock as of the close of business on April 19, 2024.
Previous wording
On April 4, 2024, the Board also authorized a new share repurchase program to repurchase up to $20.0 million in the aggregate of shares of our Class A Common Stock.
Current wording
On April 4, 2024, the Board authorized a new share repurchase program to repurchase up to $20.0 million in the aggregate of shares of our Class A Common Stock. This new share repurchase program will expire in April 2027. During the three months ended June 30, 2024, we repurchased 769,715 shares of Class A Common Stock, which were held as treasury stock as of June 30, 2024, for an aggregate purchase price of $2.5 million at an average purchase price per share of $3.27. As of June 30, 2024, $17.5 million of the repurchase authorization under the Repurchase Program remained available.
Previous wording
Subsequent to the quarter ended March 31, 2024, the Company utilized $12.7 million in cash to fund the special dividend and special distribution, as described above in Note 16 to the Consolidated Financial Statements, “Subsequent Events”.
Current wording
For further details, see Note 17 to the Consolidated Financial Statements, “Subsequent Events”.
Previous wording
We regularly review the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions, which may also be useful to an investor. The following tables and related discussion set forth key financial and operating metrics for the Company’s operations as of and for the three months ended March 31, 2024 and 2023.
Current wording
We regularly review the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions, which may also be useful to an investor. The following tables and related discussion set forth key financial and operating metrics for the Company’s operations as of and for the three and six months ended June 30, 2024 and 2023.
Previous wording
The key performance metrics presented are for the OppLoans product only and exclude the SalaryTap and OppFi Card products. Prior period metrics currently presented may differ slightly than previously reported due to the exclusion of SalaryTap and OppFi Card.
Current wording
The key performance metrics presented are for the OppLoans product only and exclude the SalaryTap and OppFi Card products.
Previous wording
The following table presents total net originations (defined as gross originations net of transferred balance on refinanced loans), total retained net originations (defined as the portion of total net originations as defined above with respect to which the Company ultimately purchased a receivable from bank partners or originated directly), percentage of net originations by bank partners, and percentage of net originations by new loans for the three months ended March 31, 2024 and 2023 (in thousands):
Current wording
The following tables present total net originations (defined as gross originations net of transferred balance on refinanced loans), total retained net originations (defined as the portion of total net originations as defined above with respect to which the Company ultimately purchased a receivable from bank partners or originated directly), percentage of net originations by bank partners, and percentage of net originations by new loans for the three and six months ended June 30, 2024 and 2023 (in thousands):
Previous wording
Total net originations increased to $163.5 million for the three months ended March 31, 2024 from $159.6 million for the three months ended March 31, 2023. The 2.4% increase for the three months ended March 31, 2024 was a result of bank partners’ expansion into additional states as well as enhanced lead evaluation capabilities driving higher quality applications. Total retained net originations decreased to $152.5 million for the three months ended March 31, 2024 from $155.6 million for the three months ended March 31, 2023. The 2.0% decrease for the three months ended March 31, 2024 was attributed to one of our bank partners retaining a higher percentage of loans originated in certain states.
Current wording
Total net originations increased to $205.5 million and $369.0 million for the three and six months ended June 30, 2024, respectively, from $200.6 million and $360.2 million for the three and six months ended June 30, 2023, respectively. The 2.4% and 2.4% increases for the three and six months ended June 30, 2024 were a result of bank partners’ expansion into additional states as well as enhanced lead evaluation capabilities driving higher quality applications. Total retained net originations decreased to $189.3 million and $341.9 million for the three and six months ended June 30, 2024, respectively, from $195.3 million and $351.0 million for the three and six months ended June 30, 2023, respectively. The 3.1% and 2.6% decreases for the three and six months ended June 30, 2024 were attributed to one of our bank partners retaining a higher percentage of loans originated in certain states.
Previous wording
Total net originations by our bank partners increased to 100.0% for the three months ended March 31, 2024 from 95.2% for the three months ended March 31, 2023. During the third quarter of 2023, the Company ceased directly originating loans and transitioned completely to a servicing / facilitation model for bank partners.
Current wording
Total net originations by our bank partners increased to 100.0% and 100.0% for the three and six months ended June 30, 2024, respectively, from 97.3% and 96.4% for the three and six months ended June 30, 2023, respectively. During the third quarter of 2023, the Company ceased directly originating loans and transitioned completely to a servicing / facilitation model for bank partners.
Previous wording
Total net originations of new loans as a percentage of total loans decreased to 42.3% for the three months ended March 31, 2024 from 44.1% for the three months ended March 31, 2023. The decrease is a result of the pool of customers available to refinance growing over time, as well as marketing campaigns targeting email engagement rates in the refinance population.
Current wording
Total net originations of new loans as a percentage of total loans increased to 44.4% for the three months ended June 30, 2024 from 43.6% for the three months ended June 30, 2023. The increase is a result of accelerating growth from our bank partners’ expansion into additional states. Total net originations of new loans as a percentage of total loans decreased to 43.5% for the six months ended June 30, 2024 from 43.8% for the six months ended June 30, 2023. The decrease is a result of the pool of customers available to refinance growing over time, as well as marketing campaigns targeting email engagement rates in the refinance population.
Previous wording
Average yield represents total revenue from the period as a percent of average receivables and is presented as an annualized metric. Receivables are defined as the unpaid principal balances of loans. The following table presents average yield for the three months ended March 31, 2024 and 2023:
Current wording
Average yield represents total revenue from the period as a percent of average receivables and is presented as an annualized metric. Receivables are defined as the unpaid principal balances of loans. The following tables present average yield for the three and six months ended June 30, 2024 and 2023:
Previous wording
Average yield increased to 129.5% for the three months ended March 31, 2024 from 126.0% for the three months ended March 31, 2023. The 2.8% increase was driven by a decrease in delinquent loans in the portfolio that were not accruing interest and a decrease in enrollment in our hardship and assistance programs, which provide payment relief due to natural disasters, loss of income, increase in expenses, or other unpredictable events, as well as a relative shift away from states with lower interest rates.
Current wording
Average yield increased to 134.8% and 131.4% for the three and six months ended June 30, 2024, respectively, from 128.8% and 126.7% for the three and six months ended June 30, 2023, respectively. The 4.7% and 3.7% increases were driven by a decrease in delinquent loans in the portfolio that were not accruing interest throughout the period as well as an increase in the average statutory rate from a relative shift away from states with lower interest rates.
Previous wording
The following table presents net charge-offs as a percentage of total revenue and as an annualized percentage of average receivables for the three months ended March 31, 2024 and 2023:
Current wording
The following tables present net charge-offs as a percentage of total revenue and as an annualized percentage of average receivables for the three and six months ended June 30, 2024 and 2023:
Previous wording
Net charge-offs as a percentage of total revenue decreased to 47.9% for the three months ended March 31, 2024 from 49.0% for the three months ended March 31, 2023. The decrease in net charge-offs as a percentage of total revenue for the three months ended March 31, 2024 is a result of a higher yielding portfolio for the reasons discussed above in “Average Yield” combined with similar levels of net charge-offs compared to the three months ended March 31, 2023. Net charge-offs as a percentage of average receivables increased slightly to 62.0% for the three months ended March 31, 2024 from 61.8% for the three months ended March 31, 2023.
Current wording
Net charge-offs as a percentage of total revenue decreased to 32.5% and 40.2% for the three and six months ended June 30, 2024, respectively, from 36.2% and 42.6% for the three and six months ended June 30, 2023, respectively. The decreases in net charge-offs as a percentage of total revenue for the three and six months ended June 30, 2024 are a result of a higher yielding portfolio for the reasons discussed above in “Average Yield” combined with higher recoveries driving lower levels of net charge-offs compared to the three and six months ended June 30, 2023. Net charge-offs as a percentage of average receivables decreased to 43.8% and 52.9% for the three and six months ended June 30, 2024, respectively, from 46.6% and 53.9% for the three and six months ended June 30, 2023, respectively. The decreases in net charge-offs as a percentage of average receivables for the three and six months ended June 30, 2024 are a result of higher recoveries driving lower levels of net charge-offs compared to the three and six months ended June 30, 2023.
Previous wording
Auto-approval rate is calculated by taking the number of approved loans that are not decisioned by a loan processor or underwriter (auto-approval) divided by the total number of loans approved. The following table presents auto approval rate for the three months ended March 31, 2024 and 2023:
Current wording
Auto-approval rate is calculated by taking the number of approved loans that are not decisioned by a loan processor or underwriter (auto-approval) divided by the total number of loans approved. The following tables present auto approval rate for the three and six months ended June 30, 2024 and 2023:
Previous wording
Auto-approval rate increased to 73.4% for the three months ended March 31, 2024 from 69.6% for the three months ended March 31, 2023. The increase in auto-approval rate for the three months ended March 31, 2024 was driven by the continued application of algorithmic automation projects that streamline frictional steps of the origination process.
Current wording
Auto-approval rate increased to 75.8% and 74.7% for the three and six months ended June 30, 2024, respectively, from 72.1% and 71.0% for the three and six months ended June 30, 2023, respectively. The increases in auto-approval rate for the three and six months ended June 30, 2024 were driven by the continued application of algorithmic automation projects that streamline frictional steps of the origination process.
Previous wording
Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.2% of total revenue for the three months ended March 31, 2024.
Current wording
Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.3% of total revenue for the three months ended June 30, 2024.
Previous wording
Total revenue increased by $7.0 million, or 5.8%, to $127.3 million for the three months ended March 31, 2024 from $120.4 million for the three months ended March 31, 2023. The increase was due to higher average receivables balances throughout the quarter as well as stronger payment activity driving a higher yield on the balances.
Current wording
Total revenue increased by $3.8 million, or 3.1%, to $126.3 million for the three months ended June 30, 2024 from $122.5 million for the three months ended June 30, 2023. The increase was due to a higher average statutory rate for the loans in the portfolio as well as stronger payment activity driving a higher yield on the balances.
Previous wording
Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $64.1 million for the three months ended March 31, 2024, which was comprised of $61.0 million of net charge-offs and a fair market value adjustment of $3.1 million, up from $63.1 million for the three months ended March 31, 2023, which was comprised of $58.8 million of net charge-offs and a fair market value adjustment of $4.4 million. The fair value adjustment for thethree months ended March 31, 2024 had a negative impact due to the decrease in receivables over the period.
Current wording
Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $40.0 million for the three months ended June 30, 2024, which was comprised of $41.1 million of net charge-offs and a fair market value adjustment of $(1.1) million, down from $44.0 million for the three months ended June 30, 2023, which was comprised of $44.2 million of net charge-offs and a fair market value adjustment of $(0.2) million. The fair value adjustment for thethree months ended June 30, 2024 had a positive impact due to the increase in receivables over the period with a relatively flat fair value mark.
Previous wording
Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $0.04 million to $0.03 million for the three months ended March 31, 2024 from $0.07 million for the three months ended March 31, 2023. The decrease is largely attributed to the $0.06 million decrease in total provision related to the SalaryTap product, partially offset by the $0.02 million increase in total provision related to the OppFi Card product.
Current wording
Provision for credit losses on finance receivables consists of gross charge-offs incurred in the period, net of recoveries, plus the change in allowance for credit losses for our SalaryTap and OppFi Card products. Provision for credit losses on finance receivables decreased by $3.9 million to $4.1 thousand for the three months ended June 30, 2024 from $3.9 million for the three months ended June 30, 2023. The decrease is largely attributed to very few remaining active SalaryTap finance receivables during the three months ended June 30, 2024, while provision for credit losses was increased during the three months ended June 30, 2023 to account for the then-impending closure of OppFi Card finance receivables.
Previous wording
Net revenue is equal to total revenue less the change in fair value and provision for credit losses on finance receivables. Total net revenue increased by $6.0 million, or 10.5%, to $63.2 million for the three months ended March 31, 2024, from $57.2 million for the three months ended March 31, 2023. This increase was mainly due to the increase in total revenue.
Current wording
Net revenue is equal to total revenue less the change in fair value and provision for credit losses on finance receivables. Total net revenue increased by $11.7 million, or 15.7%, to $86.3 million for the three months ended June 30, 2024 from $74.6 million for the three months ended June 30, 2023. This increase was due to both the increase in total revenue and the decrease in change in fair value and provision for credit losses on finance receivables.
Previous wording
Expenses increased by $4.5 million, or 8.4%, to $57.9 million for the three months ended March 31, 2024, from $53.5 million for the three months ended March 31, 2023. The increase in expenses was primarily driven by a one-time expense associated with the exit activities from the OppFi Card product as well as higher professional fees related to accounting, legal, and corporate development matters. The increase was partially offset by lower direct marketing spend expense resulting from a shift towards relatively lower-cost loans and reductions resulting from measures taken to increase customer center efficiency. Despite the large one-time expenses for the three months ended March 31, 2024, expenses as a percent of total revenue increased only modestly from 44.4% to 45.5% for the three months ended March 31, 2024 compared to the three months ended March 31, 2023.
Current wording
Expenses increased by $0.6 million, or 1.0%, to $56.8 million for the three months ended June 30, 2024, from $56.2 million for the three months ended June 30, 2023. The increase in expenses was primarily driven by a one-time adjustment as a result of the reclassification of OppFi Card assets from held for sale to held for investment at amortized cost that offset expenses for the three months ended June 30, 2023. The increase was partially offset by lower direct marketing spend expense resulting from a shift towards relatively lower-cost loans, reduced payment processing fees related to a renegotiation, and lower professional fees related to accounting and legal matters. Despite the slight increase in total expenses for the three months ended June 30, 2024, expenses as a percent of total revenue decreased from 45.9% to 45.0% for the three months ended June 30, 2024 compared to the three months ended June 30, 2023.
Previous wording
Income from operations is the difference between net revenue and expenses. Total income from operations increased by $1.6 million to $5.3 million for the three months ended March 31, 2024 from income from operations of $3.7 million for the three months ended March 31, 2023. This increase was driven primarily by higher total revenue outweighing higher net charge-offs and expenses for the three months ended March 31, 2024 as a result of the reasons discussed above.
Current wording
Income from operations is the difference between net revenue and expenses. Total income from operations increased by $11.2 million to $29.5 million for the three months ended June 30, 2024 from income from operations of $18.3 million for the three months ended June 30, 2023. This increase was driven primarily by higher total revenue and lower change in fair value and provision for credit losses on finance receivables, slightly offset by higher expenses for the three months ended June 30, 2024 as a result of the reasons discussed above.
Previous wording
Change in fair value of warrant liabilities totaled $5.2 million for the three months ended March 31, 2024 and $0.2 million for the three months ended March 31, 2023. These warrant liabilities arose with respect to warrants issued in connection with the initial public offering of FGNA and is subject to re-measurement at each balance sheet date.
Current wording
Change in fair value of warrant liabilities totaled $(1.0) million for the three months ended June 30, 2024 and $0.4 million for the three months ended June 30, 2023. These warrant liabilities arose with respect to warrants issued in connection with the initial public offering of FGNA and are subject to re-measurement at each balance sheet date.
Previous wording
Income before income taxes is the sum of income from operations, the change in fair value of warrant liabilities, and other income. Income before income taxes increased by $6.5 million to $10.5 million for the three months ended March 31, 2024 from $4.1 million for the three months ended March 31, 2023.
Current wording
Income before income taxes is the sum of income from operations, the change in fair value of warrant liabilities, and other income. Income before income taxes increased by $9.8 million, or 52.4%, to $28.6 million for the three months ended June 30, 2024 from $18.8 million for the three months ended June 30, 2023 for the reasons stated above.
Previous wording
OppFi Inc. recorded an income tax expense of $0.4 million for the three months ended March 31, 2024 and $0.1 million for the three months ended March 31, 2023. This increase is largely attributed to OppFi Inc.’s increasing ownership in OppFi-LLC.
Current wording
OppFi recorded an income tax expense of $0.9 million for the three months ended June 30, 2024 and $0.7 million for the three months ended June 30, 2023. This increase is largely attributed to OppFi Inc.’s increasing ownership in OppFi-LLC.
Previous wording
Net income increased by $6.2 million to $10.1 million for the three months ended March 31, 2024 from net income of $3.9 million for the three months ended March 31, 2023 for all of the reasons stated above.
Current wording
Net income increased by $9.6 million to $27.7 million for the three months ended June 30, 2024 from net income of $18.1 million for the three months ended June 30, 2023 for the reasons stated above.
Previous wording
Net income attributable to OppFi Inc. was $5.5 million for the three months ended March 31, 2024, up from net income attributable to OppFi Inc. of $0.3 million for the three months ended March 31, 2023. Net income attributable to OppFi Inc. represents the income solely attributable to stockholders of OppFi Inc. As a result of the Company’s Up-C structure, the underlying income or expense components that are attributable to OppFi Inc. are generally expense items related to OppFi Inc.’s status as a public company, the income or expense for the change in fair value of warrant liabilities related to the Company’s warrants, and the Company’s approximate percentage interest in the non-controlling interest. For the three months ended March 31, 2024, the underlying income or expense components that are attributable to OppFi Inc. include the gain on change in fair value of warrant liabilities of $5.2 million, partially offset by income tax expense of $0.4 million, general and administrative expense of $0.1 million, and board fees of $0.1 million, for total income attributable to OppFi Inc. of $4.6 million. The income also includes OppFi Inc.'s percentage interest in the income attributable to non-controlling interest of $0.9 million, for total net income attributable to OppFi Inc. of $5.5 million. For the three months ended March 31, 2023, the underlying income or expense components that are attributable to OppFi Inc. include the gain on change in fair value of warrant liabilities of $0.2 million, partially offset by income tax expense of $0.2 million, general and administrative expense of $0.2 million, and board fees of $0.1 million, for total loss attributable to OppFi Inc. of $0.3 million. The income also includes OppFi Inc.’s percentage interest in the income attributable to non-controlling interest of $0.6 million, for net income attributable to OppFi Inc. of $0.3 million.
Current wording
Net income attributable to OppFi Inc. was $3.1 million for the three months ended June 30, 2024, up from net income attributable to OppFi Inc. of $2.1 million for the three months ended June 30, 2023. Net income attributable to OppFi Inc. represents the income solely attributable to stockholders of OppFi Inc. As a result of the Company’s Up-C structure, the underlying income or expense components that are attributable to OppFi Inc. are generally expense items related to OppFi Inc.’s status as a public company, the income or expense for the change in fair value of warrant liabilities related to the Company’s warrants, and the Company’s approximate percentage interest in the noncontrolling interest. For the three months ended June 30, 2024, the underlying income or expense components attributable to OppFi Inc. include OppFi Inc.'s percentage interest in the income attributable to noncontrolling interest of $5.3 million, partially offset by the loss on change in fair value of warrant liabilities of $1.0 million, income tax expense of $0.9 million, general and administrative expense of $0.2 million, and board fees of $0.1 million, for total net income attributable to OppFi Inc. of $3.1 million. For the three months ended June 30, 2023, the underlying income or expense components that are attributable to OppFi Inc. include OppFi Inc.’s percentage interest in the income attributable to noncontrolling interest of $2.6 million and the gain on change in fair value of warrant liabilities of $0.3 million, partially offset by income tax expense of $0.6 million, general and administrative expense of $0.1 million, and board fees of $0.1 million, for net income attributable to OppFi Inc. of $2.1 million.
Previous wording
Other income totaled $0.1 million for the three months ended March 31, 2024 and $0.2 million for the three months ended March 31, 2023. For the three months ended March 31, 2024, other income includes $0.1 million in income related to the Company subleasing one floor of its office space. For the three months ended March 31, 2023, other income includes $0.1 million in income related to the Company subleasing one floor of its office space and $0.1 million from the gain on partial loan forgiveness of the secured borrowing payable.
Current wording
Other income totaled $0.2 million for the six months ended June 30, 2024 and $0.3 million for the six months ended June 30, 2023. For the six months ended June 30, 2024, other income includes $0.2 million in income related to the Company subleasing one floor of its office space. For the six months ended June 30, 2023, other income includes $0.2 million in income related to the Company subleasing one floor of its office space and $0.1 million from the gain on partial loan forgiveness of the secured borrowing payable.
Previous wording
The Company’s outstanding shares of Class V Voting Stock were included in computing the diluted earnings per share for the three months ended March 31, 2024 as the inclusion of these shares had a dilutive effect under the if-converted method. Under the if-converted method, shares of the Company’s Class V Voting Stock are assumed to be exchanged, together with OppFi Units, into shares of the Company’s Class A Common Stock as of the beginning of the period. The Company’s outstanding shares of Class V Voting Stock were excluded in computing the diluted earnings per share for the three months ended March 31, 2023 as the inclusion of these shares would have had an antidilutive effect under the if-converted method.
Current wording
For the six months ended June 30, 2024, the Company’s outstanding shares of Class V Voting Stock were included in computing the diluted earnings per share as the inclusion of these shares had a dilutive effect under the if-converted method. Under the if-converted method, shares of the Company’s Class V Voting Stock are assumed to be exchanged, together with OppFi Units, into shares of the Company’s Class A Common Stock as of the beginning of the period. For the six months ended June 30, 2023, the Company’s outstanding shares of Class V Voting Stock were excluded in computing the diluted earnings per share as the inclusion of these shares would have had an antidilutive effect under the if-converted method.
Previous wording
Total cash and restricted cash increased by $14.8 million as of March 31, 2024 compared to December 31, 2023 driven by an increase in received payments relative to originations. Finance receivables at fair value decreased by $51.3 million as of March 31, 2024 compared to December 31, 2023 from lower origination volume due to seasonality. Finance receivables at amortized cost, net decreased by $0.1 million as of March 31, 2024 compared to December 31, 2023 due to the continued rundown of SalaryTap finance receivables. Other assets decreased by $1.8 million as of March 31, 2024 compared to December 31, 2023 mainly due to a decrease in property, equipment, and software of $0.6 million, a decrease in the operating lease right of use asset of $0.4 million, and a decrease in capitalized debt issuance costs of $0.4 million.
Current wording
Total cash and restricted cash increased by $6.9 million as of June 30, 2024 compared to December 31, 2023 driven by an increase in received payments relative to originations. Finance receivables at fair value decreased by $32.8 million as of June 30, 2024 compared to December 31, 2023 from lower origination volume due to seasonality. Finance receivables at amortized cost, net decreased by $0.1 million as of June 30, 2024 compared to December 31, 2023 due to the continued rundown of SalaryTap finance receivables. Other assets decreased by $2.4 million as of June 30, 2024 compared to December 31, 2023 mainly due to a decrease in the operating lease right of use asset of $0.8 million, a decrease in the deferred tax asset of $0.7 million, and a decrease in property, equipment, and software of $0.5 million.
Previous wording
Accounts payable and accrued expenses decreased by $2.4 million as of March 31, 2024 compared to December 31, 2023 driven by a decrease in accounts payable of $0.5 million and accrued expenses of $2.0 million. Other liabilities decreased by $0.9 million as of March 31, 2024 compared to December 31, 2023 driven by a decrease in the operating lease liability of $0.4 million and the tax receivable agreement liability of $0.5 million. Total debt decreased by $33.1 million as of March 31, 2024 compared to December 31, 2023 driven by a decrease in utilization of revolving lines of credit of $32.4 million and a decrease in notes payable of $0.7 million. Warrant liabilities decreased by $5.2 million due to the decrease in the valuation of the warrants as of March 31, 2024 compared to December 31, 2023. Total stockholders’ equity increased by $3.3 million as of March 31, 2024 compared to December 31, 2023 driven by net income and stock-based compensation.
Current wording
Accounts payable and accrued expenses increased by $1.6 million as of June 30, 2024 compared to December 31, 2023 driven by an increase in accrued expenses of $3.6 million, partially offset by a decrease in accounts payable of $2.0 million. Other liabilities decreased by $1.1 million as of June 30, 2024 compared to December 31, 2023 driven by a decrease in the operating lease liability of $0.9 million and the tax receivable agreement liability of $0.2 million. Total debt decreased by $32.3 million as of June 30, 2024 compared to December 31, 2023 driven by a decrease in utilization of revolving lines of credit of $30.9 million and a decrease in notes payable of $1.4 million. Warrant liabilities decreased by $4.2 million due to the decrease in the valuation of the warrants as of June 30, 2024 compared to December 31, 2023. Total stockholders’ equity increased by $7.7 million as of June 30, 2024 compared to December 31, 2023 driven by net income and stock-based compensation, partially offset by purchases of treasury stock and dividend issuance.
Previous wording
Beginning with the quarter ended March 31, 2024, for all periods presented, we have updated our presentation and calculation of the Adjusted EBT, and the corresponding presentations and calculations of Adjusted Net Income and Adjusted EPS, to no longer add back debt issuance cost amortization.
Current wording
Beginning with the quarter ended March 31, 2024, for all periods presented, we have updated our presentation and calculation of Adjusted EBT, and the corresponding presentations and calculations of Adjusted Net Income and Adjusted EPS, to no longer add back debt issuance cost amortization.
Previous wording
Adjusted EBT is a non-GAAP measure defined as our GAAP net income adjusted to eliminate the effect of certain items as shown below, including income tax expense, other income, change in fair value of warrant liabilities and other addbacks and one-time expenses. Adjusted Net Income is a non-GAAP measure defined as our Adjusted EBT less pro forma taxes for comparison purposes. We believe that Adjusted EBT and Adjusted Net Income are important measures because they allow management, investors, and our board of directors to evaluate and compare our operating results from period-to-period by making the adjustments described below.
Current wording
Adjusted EBT is a non-GAAP measure defined as our GAAP net income adjusted to eliminate the effect of certain items as shown below, including income tax expense, other income, change in fair value of warrant liabilities and other addbacks and one-time expenses. Adjusted Net Income is a non-GAAP measure defined as our Adjusted EBT less pro forma taxes for comparison purposes. We believe that Adjusted EBT and Adjusted Net Income are important measures because they allow management, investors, and our Board to evaluate and compare our operating results from period-to-period by making the adjustments described below.
Previous wording
(a) For the three months ended March 31, 2024, other addbacks and one-time expenses, net of $6.2 million included a $2.9 million expense related to OppFi Card’s exit activities, $1.0 million in stock compensation expenses, $0.8 million in severance expenses, $0.8 million in expenses related to corporate development, and $0.7 million in expenses related to legal matters. For the three months ended March 31, 2023, other addbacks and one-time expenses, net of $1.3 million included $1.1 million in stock compensation expenses, $0.1 million in severance expenses and a $0.1 million expense related to the change in the value of the OppFi Card finance receivables held for sale.
Current wording
(a) For the three months ended June 30, 2024, other addbacks and one-time expenses, net of $2.9 million included $2.1 million in stock compensation expenses, $0.5 million in expenses related to legal matters, $0.3 million in severance expenses, and $0.1 million in expenses related to corporate development. For the three months ended June 30, 2023, other addbacks and one-time expenses, net of $2.6 million included a $(3.1) million addback from the reclassification of OppFi Card finance receivables from assets held for sale to assets held for investment at amortized cost, a $3.8 million expense related to provision for credit losses on the OppFi Card finance receivables, $0.8 million in stock compensation expenses, $0.6 million in severance expenses, $0.4 million in expenses related to corporate development, and $0.1 million in retention expenses.
Showing the first 40 of 50 pairs. Open the source sections for the rest.
Rearranged current paragraphs (18)
Current report — wording carried from elsewhere
Ending receivables decreased to $387.1 million as of June 30, 2024 from $397.8 million as of June 30, 2023. The 2.7% decrease was primarily driven by a one of our bank partners retaining a higher percentage of loans originated in certain states.
Current report — wording carried from elsewhere
Other income totaled $0.1 million for the three months ended June 30, 2024 and $0.1 million for the three months ended June 30, 2023. Other income for both periods was comprised of $0.1 million in income related to the Company subleasing one floor of its office space.
Current report — wording carried from elsewhere
The Company’s outstanding shares of Class V Voting Stock were excluded in computing the diluted earnings per share for the three months ended June 30, 2024 as the inclusion of these shares would have had an antidilutive effect under the if-converted method. Under the if-converted method, shares of the Company’s Class V Voting Stock are assumed to be exchanged, together with OppFi Units, into shares of the Company’s Class A Common Stock as of the beginning of the period. The Company’s outstanding shares of Class V Voting Stock were also excluded in computing the diluted earnings per share for the three months ended June 30, 2023 as the inclusion of these shares would have had an antidilutive effect under the if-converted method.
Current report — wording carried from elsewhere
The following table presents our consolidated results of operations for the six months ended June 30, 2024 and 2023 (in thousands, except number of shares and per share data).
Current report — wording carried from elsewhere
Total revenue consists mainly of revenue earned from interest on receivables from outstanding loans based on the interest method. We also earn revenue from referral fees related primarily to our “Turn-Up” program, which represented 0.2% of total revenue for the six months ended June 30, 2024.
Current report — wording carried from elsewhere
Change in Fair Value and Provision for Credit Losses on Finance Receivables
Current report — wording carried from elsewhere
Commencing on January 1, 2021, we elected the fair value option on the OppLoans installment product. To derive the fair value, we utilize discounted cash flow analyses that factor in estimated losses and prepayments over the estimated duration of the underlying assets. Loss and prepayment assumptions are determined using historical loss data and include appropriate consideration of recent trends and anticipated future performance. Future cash flows are discounted using a rate of return that we believe a market participant would require based on the risk characteristics of the loans. We did not elect the fair value option on our SalaryTap and OppFi Card finance receivables, which are carried at amortized cost, net of allowance for credit losses.
Current report — wording carried from elsewhere
Change in fair value consists of gross charge-offs incurred in the period on the OppLoans installment product, net of recoveries, plus the change in the fair value on the installment loans portfolio. Change in fair value totaled $104.1 million for the six months ended June 30, 2024, which was comprised of $102.1 million of net charge-offs and a fair market value adjustment of $2.1 million, down from $107.2 million for the six months ended June 30, 2023, which was comprised of $103.0 million of net charge-offs and a fair market value adjustment of $4.2 million. The fair value adjustment for the six months ended June 30, 2024 had a negative impactdue to the decrease in receivables over the period with a relatively flat fair value mark.
Current report — wording carried from elsewhere
Expenses includes costs related to salaries and employee benefits, interest expense and amortized debt issuance costs, sales and marketing, customer operations, technology, products, and analytics, and other general and administrative expenses.
Current report — wording carried from elsewhere
Income from operations is the difference between net revenue and expenses. Total income from operations increased by $12.7 million to $34.8 million for the six months ended June 30, 2024 from income from operations of $22.1 million for the six months ended June 30, 2023. This increase was driven primarily by higher total revenue and lower change in fair value and provision for credit losses on finance receivables, slightly offset by higher expenses for the six months ended June 30, 2024 as a result of the reasons discussed above.
Current report — wording carried from elsewhere
Change in Fair Value of Warrant Liabilities
Current report — wording carried from elsewhere
Change in fair value of warrant liabilities totaled $4.2 million for the six months ended June 30, 2024 and $0.5 million for the six months ended June 30, 2023. These warrant liabilities arose with respect to warrants issued in connection with the initial public offering of FGNA and is subject to re-measurement at each balance sheet date.
Current report — wording carried from elsewhere
Income before income taxes is the sum of income from operations, the change in fair value of warrant liabilities, and other income. Income before income taxes increased by $16.3 million, or 71.3%, to $39.1 million for the six months ended June 30, 2024 from $22.8 million for the six months ended June 30, 2023 for the reasons stated above.
Current report — wording carried from elsewhere
Net Income Attributable to OppFi Inc.
Current report — wording carried from elsewhere
Net income attributable to OppFi Inc. was $8.6 million for the six months ended June 30, 2024, up from $2.4 million for the six months ended June 30, 2023. Net income attributable to OppFi Inc. represents the income solely attributable to stockholders of OppFi Inc. As a result of the Company’s Up-C structure, the underlying income or expense components that are attributable to OppFi Inc. are generally expense items related to OppFi Inc.’s status as a public company, the income or expense for the change in fair value of warrant liabilities related to the Company’s warrants, and the Company’s approximate percentage interest in the noncontrolling interest. The underlying income or expense components that are attributable to OppFi Inc. for the six months ended June 30, 2024 are OppFi Inc.’s percentage interest in the income attributable to noncontrolling interest of $6.3 million and gain on change in fair value of warrant liabilities of $4.2 million, partially offset by income tax expense of $1.3 million, general and administrative expense of $0.4 million, and board fees of $0.2 million, for total net income attributable to OppFi Inc. of $8.6 million. The underlying income or expense components that are attributable to OppFi Inc. for the six months ended June 30, 2023 are OppFi Inc.’s percentage interest in the income attributable to noncontrolling interest of $3.2 million and gain on change in fair value of warrant liabilities of $0.5 million, partially offset by income tax expense of $0.8 million, general and administrative expense of $0.4 million, and board fees of $0.2 million, for total net income attributable to OppFi Inc. of $2.4 million.
Current report — wording carried from elsewhere
(b) Beginning with the quarter ended March 31, 2024, for all periods presented, the Company has updated its presentation and calculation of Adjusted EBT, and the corresponding presentations and calculations of Adjusted Net Income and Adjusted EPS, to no longer add back debt issuance cost amortization.
Current report — wording carried from elsewhere
(c) Assumes a tax rate of 23.56% for the six months ended June 30, 2024 and a 24.16% tax rate for the six months ended June 30, 2023, reflecting the U.S. federal statutory rate of 21% and a blended statutory rate for state income taxes.
Current report — wording carried from elsewhere
(a) Beginning with the quarter ended March 31, 2024, for all periods presented, the Company has updated its presentation and calculation of Adjusted EBT, and corresponding presentations and calculations of Adjusted Net Income and Adjusted EPS, to no longer add back debt issuance cost amortization.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Comparison of the three months ended March 31, 2024 and 2023