Consumer Portfolio Services, Inc. · NASDAQ:CPSS
Consumer Portfolio Services — Investor Presentation (July 2007)
23 slides from Consumer Portfolio Services's investor presentation, Jul 31, 2007
Slide 1: As of June 30, 2007
As of June 30, 2007
Slide 2: Safe Harbor Statement
Safe Harbor Statement Information included in the following slides is believed to be accurate, but is not necessarily complete. Such information should be reviewed in its appropriate context. The implication that historical trends will continue in the future, or that past performance is indicative o
Slide 3: Reference to Public Reports
Reference to Public Reports Any person considering an investment in securities issued by CPS is urged to review the materials filed by CPS with the U.S. Securities and Exchange Commission ("Commission"). Such materials may be found by inquiring of ie laine!’ BbIGu Rs search page (http:/Avww.sec. gov
Slide 4: Company Overview
Company Overview ¥ Specialty finance company ¥ Irvine, California focused on sub-prime auto headquarters and three market strategically located servicing branches in Virginia, Florida and Illinois Y Established in 1991; IPOin ¥ Approximately 860 1992 employees ¥ Through June 30, 2007, ¥ As of June 3
Slide 5: U.S. Auto Finance Market
U.S. Auto Finance Market ¥ 2005 U.S. auto financing = $407 billion” = $211 billion new, $196 billion used ¥ Company estimates 20%, or $81 billion is “‘sub-prime” ¥ Historically fragmented market with few long-term dominant players ¥ Significant barriers to entry > @ Major Market Players: AmeriCredit
Slide 6: Contract purchases for six months ended June 30, 2007
‘months ended June 30, 2007 5 () (2) Includes contract purchases oF TFC, a subsidiary that targets enlisted members of U.S, Armed Forces
Slide 7: Collateral Description
Collateral Description 82% Pre-owned 67% Domestic 15% 33% Foreign 25% eee Securitization 2007-B ¥ Primarily late model pre- a Tre Priel Balan itaccnitre owned vehicles 18% New 2007 2006 2005 2004 2003 2002Earlier
Slide 8: Program Overview
Program Overview CPS’s risk-adjusted pricing results in program offerings covering a wide band of the credit spectrum New contract acquisitions for the six months ended June 30, 2007 Goh velo | ESET | Eeesccnl eee Preferred 12.0% $19,301 568 5% Super Alpha 14.8% $19,777 520 12% Alpha Plus 16.5% $17,
Slide 9: Borrower and Contract Profile
Borrower and Contract Profile An emphasis on stable borrowers with the ability to rehabilitate their credit profile Borrower: Average age 38 years Average time in job 5 years Average time in residence 5 years Average credit history 9 years Average household income $41,088 per year Percentage of horn
Slide 10: Operations
Operations Contract Originations Centralized contract originations at Irvine HQ * Maximizes control and efficiencies Proprietary auto-decisioning system = Makes initial credit decision on approximately 90% of incoming applications = Enhances dealer service by shortening response time Pre-finding ver
Slide 11: Historical Origination Volume
Historical Origination Volume Since inception through June 30, 2007 the Company has originated over $7.7 billion 1,200 1,000 800 Annual Volumes 600 (G in millions) 400 200 EEE
Slide 12: Strategies for Future Growth
Strategies for Future Growth v Increase dealer penetration and expand dealer network = Expansion of marketing rep network = Continue high level of dealer contact with improved service levels = Expansion of risk-based pricing model = Expansion of the independent dealer program = Retention of existing
Slide 13: Portfolio Financing
Portfolio Financing ¥ Two senior warehouse facilities aggregating $400 million ¥ $25 million subordinated warehouse facility allows advance tates up to 93% across both senior lines ¥ Quarterly “AAA” rated asset-backed securities provide long- term matched funding - $6.5 billion in 46 deals since 199
Slide 14: Historical Corporate Debt
$in million: Historical Corporate Debt 160 35.00% mms Residtal Interest Debt (left axis) 140 I 120 100 smn LT Debt (bit axis) 30.00% “te-Resihul ard LT Debt to Managed i Portfolio (xght ax) 25.00% | 20.00% | 15.00% | ] 10.00% 500% on0% (S)) Period Ending 14
Slide 15: Total Managed Portfolio
Total Managed Portfolio Composition by Source ($ in millions) ees $1,566 mm 7 $1,900 mm — sig all $1,122 mm Y | aa $907 mm sai Paty ee $744 mm aes sipw4 — $595 mm ue 00s Primary Driver of Growth is CPS “Organic” Contract Purchases 5s © ee
Slide 16: Delinquencies and Repo Inventory
Delinquencies and Repo Inventory Three quarter rolling averages 9.00% A a ' scala i) = we 6.00% ] 5.00% 3.00% cPs 2.00% ———— 1.00% 0.00% EEIM LIP SSSR IS ES IIH LO IOS IA LG SL HS SAO OOS G iS) Consistent Performance and Positive Trends 2) S0cemore days pat de (3 fapn moaned called in Angust 2005,
Slide 17: Static Pool Performance
Static Pool Performance Average ABS Pool Cumulative Net Losses as of June 30, 2007 Consistent Performance and Positive Trends 18.00% 1997 16.00% = 14.00% = —2002 12.00% 2003 —2004 10.00% a soo, 7°08 6.00% f 4.00% ABS pools from 2003 onward 2.00% exhibit substantially better nee 0.00% 1G) WP ASIST ES
Slide 18: Auction Values
Auction Values Liquidation Values for Repo Sales Have Increased from 2003 « . ~~ eee 30% 50% 20% | ——_ © CPS Portfolio 10% +——— 0% 2 > o No e s tines SIP PEP EEE IE EE | (1) Net liquidation proceeds as a percentage of the net balance at the time of sale of the vehicle
Slide 19: Summary Balance Sheets
Summary Balance Sheets (Bin mallions) Tune 30, December 31. December 31, ping 7006 2005 Assets Cash $ 134 $142 $178 Restricted Cash 2610 1930, 1577 Finance receivables, net of allowance 1,743.9 1,401.4 9136 Residual interest in secusitizations 54 138 52 Deferred tax assets, net 559 547 15 Other Asse
Slide 20: Summary Statements of Operations
20 Summary Statements of Operations (8 in millions) Reveres Interest income Servicing fees Other income Expenses Employee costs General and administrative Interest Provision for credit losses Pretax income (loss) Income tax expense (gain) Net income (lass) EPS (fully diluted) EPS (fully diluted) wit
Slide 21: Selected Financial Data
Selected Financial Data (8 in millions) Six Months Ended Years Ended June 30, June 30, December 31, December 31, December 31, 2007 2006 2006 2005 2004 Auto contract purchases $676.3 $523.2 $1,019.0 $601.3 $447.2 Total managed portfotio $1,9003 $1,753 $1,565.9 $1,121.7 $006.9 Risk-adjusted margin (1)
Slide 22: Investment Merits
Investment Merits V_ CPS has weathered industry V Recurring revenue model and turbulence to remain one of the sound quality of earnings few independent public auto nance conpanies V Operating leverage through _. economies of scale V Attractive industry fundamentals ¥ Disciplined approach to credit ¥
Slide 23: Consumer Portfolio Services, Inc.
Consumer Portfolio Services — Investor Presentation (July 2007) on 6ix