- Record originations and loan portfolio balance drive record
revenue
- Strong balance sheet in place to support growth momentum and
strategy
TORONTO, Feb. 16, 2022 /CNW/ - Axis Auto Finance Inc.
("Axis" or the "Company") (TSXV: AXIS), a financial technology
company changing the way Canadians purchase and finance used
vehicles, is pleased to announce its fiscal second quarter results
for the period ending December 31,
2021.
Q2 Financial and Business Highlights:
- Auto loan originations increased 21% to a record $36.7 million;
- Record auto loan portfolio balance of $197 million, up 29% year over year;
- Revenues at record levels at $10.1
million;
- Adjusted Earnings of $1.6
million;
- 21% year-over-year reduction in annualized credit losses to
7.77%;
- Launched Direct-To-Consumer ("D2C") platform
DriveAxis.ca;
- Increased senior credit facility to $120
million while reducing borrowing cost;
- Completed a $15 million equity
investment by Westlake Financial.
Auto loan originations were $36.7
million in the quarter, a 21% year-over-year increase.
$20.6 million were owned and on
balance sheet assets and $16.1
million were loans managed for Westlake Financial Services
("Westlake"). These record origination volumes resulted in
Axis' owned and managed auto loan portfolio assets rising to
$197 million, consisting of
$131.4 million of owned and
$65.6 million in managed assets.
Equipment finance origination volumes in the quarter were
$24.5 million, $5.4 million in owned and on balance sheet
assets, and $19.1 million brokered to
third parties. In aggregate, the Axis on balance sheet portfolio
balance was $138.1 million at
quarter-end.
Revenues for the quarter rose to a record $10.1 million, an increase of 4%
year-over-year.
Adjusted earnings for the quarter was $1.6 million, or $0.014 per share, as compared to $1.5 million or $0.015 per share for the second quarter of fiscal
2021. Net income for the quarter was $0.2 million or $0.002 per share, as compared to net income of
$0.4 million or $0.004 per share in the second quarter of fiscal
2021. Adjusted shareholder equity was $59.6
million as at December 31,
2021, or $0.47 per share.
Annualized credit losses for the quarter were 7.77%, down from
9.88% last year, representing a 21% improvement. Furthermore, the
Company concluded the quarter with reportable delinquency of
3.65%.
During the quarter, Axis launched DriveAxis.ca, its D2C
platform. This 100% digital retail solution allows consumers to
purchase/finance a used vehicle from anywhere at any time and get
it delivered to their home. The pilot, which was launched in the
Ontario market, featured 5 dealers
listing approximately 500 vehicles on the platform.
In October 2021, Axis' senior
secured credit facility was expanded to a maximum committed funding
amount of $120 million, while
borrowing costs decreased to Prime Rate plus 1.90%. The maximum
advance rate on the facility was increased to 77%.
In November 2021, Axis closed a
non-brokered private placement of common shares at a price of
$0.50 per common share, for total
gross proceeds of $15 million. The
investment was made by NowLake Technology, LLC, the fintech parent
company of Westlake Financial.
About Axis Auto Finance
Axis is a financial technology company changing the way
Canadians buy and finance used vehicles. Through our
direct-to-consumer portal, DriveAxis.ca, customers can choose their
next used vehicle, arrange financing and get the car delivered to
their home. Through its indirect loan origination channels, Axis
continues to provide alternative used vehicle financing options to
roughly 30% of Canadians (Source: Equifax) that have credit scores
in the non-prime range. All Axis auto loans report to Equifax,
resulting in over 70% of customers seeing a significant improvement
of their credit scores. Further information on the Company can be
found at
https://www.axisfinancegroup.com/investors-press-releases/.
Non-IFRS Measures
The Company's interim unaudited consolidated financial
statements have been prepared in accordance with International
Financial Reporting Standards ("IFRS") as issued by the
International Accounting Standards Board ("IASB") and the
accounting policies we adopted in accordance with IFRS. The Company
believes that certain Non-IFRS Measures can be useful to investors
because they provide a means by which investors can evaluate the
Company's underlying key drivers and operating performance of the
business, exclusive of certain adjustments and activities that
investors may consider to be unrelated to the underlying economic
performance of the business of a given period. A full description
of these measures can be found in the Management Discussion &
Analysis that accompanies the financial statements for the
corresponding period.
The TSX Venture Exchange has neither approved nor disapproved
the contents of this press release. Neither the Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the Exchange) accepts responsibility for the adequacy
or accuracy of this release.
SOURCE Axis Auto Finance Inc.