Upbound Group, Inc. · NASDAQ:UPBD
Upbound — Rent A Center Inc DE — Q1 2021 Earnings Presentation
18 slides from Upbound's earnings presentation, May 6, 2021
Slide 1: Rent-A-Center: First Quarter 2021 Earnings Review
Rent-A-Center: First Quarter 2021 Earnings Review
Slide 2: Important Notices
IMPORTANT NOTICES 2 Forward-Looking Statements This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements regarding our goals, plans and projections with respect to our operations, financial p
Slide 3: 2021 First Quarter Review
3 2021 FIRST QUARTER REVIEW Completed acquisition of Acima Holdings, LLC, a leading virtual lease to own provider Q1 2021 Consolidated revenues of $1,037 million, up 47.7%; Consolidated pro forma revenues up 24.8% Q1 2021 Adjusted EBITDA1 of $135 million increased 105.5% and Non-GAAP Diluted E
Slide 4: Two Industry Leading Platforms, One LTO Vision
4 TWO INDUSTRY LEADING PLATFORMS, ONE LTO VISION Foundational LTO Program Seamless LTO across mobile, web & store Proprietary platform to facilitate e-commerce Nationwide store model e-commerce LTO platform Scale allows us to serve customers at multiple touchpoints Digital allows for a broader r
Slide 5: Acima Financial Highlights
5 ACIMA FINANCIAL HIGHLIGHTS Q1 2021 Highlights Invoice Volume Growth: Approximately 28% versus last year on a pro-forma basis Revenue Growth: +111.7% to $457M Pro forma Revenue Growth: +30.2% Skip / Stolen Losses: 8.6% of revenue, lower by 360 basis points versus last year Acima stand-alo
Slide 6: Acima: Positioned for Growth
6 ACIMA: POSITIONED FOR GROWTH Integration status Financial targets Integration of Preferred Lease and Acima on track Restructured regional leadership of staffed and virtual businesses improving span of control Restructured sales organizations, collections and servicing activities gaining over
Slide 7: Introducing the new Acima LeasePay card
Introducing the new Acima LeasePay card First open-loop LeasePay card enabling consumers to shop at a broad array of physical and digital retail locations First LTO payments card in the industry that provides retailers access to a significantly larger segment of consumers Virtual lease pay c
Slide 8: Rent-A-Center Business Financial Highlights
8 RENT-A-CENTER BUSINESS FINANCIAL HIGHLIGHTS Rent-A-Center Business Same Store Sales Digital acceleration in the RAC business has generated over 50% growth in e-commerce revenues in the first quarter 2021 25.1% 0% 5% 10% 15% 20% 25% 30% Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 Rent-A-Center Business 2-Ye
Slide 9: Rent-A-Center Business Long Term Strategy
9 RENT-A-CENTER BUSINESS LONG TERM STRATEGY Long-Term Growth Strategies Invest in digital initiatives to enhance the customer experience Accelerate e-commerce growth via enhancements to platform Leverage Acima decision engine; expand digital payment and communication Continue expansion into e
Slide 10: Rent-A-Center Business: Driving Sustainable, Profitable Growth
10 RENT-A-CENTER BUSINESS: DRIVING SUSTAINABLE, PROFITABLE GROWTH 2021E Assumptions Financial targets Same store sales normalized in back half of the year to mid to high single digits Government stimulus programs not assumed to continue in remaining quarters Skip/stolen losses projected in the
Slide 11: Q1 2021 Financial Highlights
11 Q1 2021 FINANCIAL HIGHLIGHTS Consolidated Revenue Growth: +47.7% versus last year Pro Forma Revenue Growth: +24.8% versus last year Adjusted EBITDA1: $135M, higher by 105.5 percent versus last year and 49.3% versus last year on a Pro-Forma basis Adjusted EBITDA Margin: 13.0% of revenue, +
Slide 12: 2021 Updated Guidance
12 2021 UPDATED GUIDANCE Annual Guidance Consolidated 1,2 Low High Revenues ($bn) $4.450 $4.600 Adjusted EBITDA ($mm) 4 $600 $650 % revenues 13.5% 14.1% Diluted Non-GAAP EPS 4 $5.30 $5.85 Free Cash Flow ($mm) 3,4 $250 $300 Acima Segment (includes Preferred Lease) 1 Revenues ($bn) $2.320 $2.420 Adjus
Slide 13: Capital Allocation Priorities and Long Term Financial Targets
13 Investing in working capital to fuel organic growth of the largely untapped virtual LTO business #1 Maintain net leverage to <2.0x, with a long term leverage target of 1.5x, while preserving robust liquidity #2 Driving total shareholder return through dividends and opportunistic share repurchases
Slide 14: Appendix
Appendix
Slide 15: Q1 2021 Financial Highlights
15 Q1 2021 FINANCIAL HIGHLIGHTS 1 Non-GAAP financial measure. Refer to explanations and reconciliations elsewhere in this presentation. Q1 2021 In millions, except percentages and EPS Actual % of Total Revenue Rent-A-Center Business $525 50.6% Acima $457 44.1% Franchising $40 1.4% Mexico $14 3.9% To
Slide 16: Reconciliation of Net Earnings Per Share to Non-GAAP Diluted EPS
16 RECONCILIATION OF NET EARNINGS PER SHARE TO NON-GAAP DILUTED EARNINGS PER SHARE 1 Refer to slide 17 for additional details (in thousands, except per share data) Amount Per Share Amount Per Share Net Earnings 42,552$ 0.64$ 49,292$ 0.88$ Special items, net of taxes Other (gains) charges 1 43,328 0.
Slide 17: Reconciliation of Operating Profit to Adjusted EBITDA
17 RECONCILIATION OF OPERATING PROFIT TO ADJUSTED EBITDA (CONSOLIDATED AND BY SEGMENT) (in thousands) Rent-A- Center Business Acima Mexico Franchising Corporate Consolidated GAAP Operating Profit (Loss) 121,277$ 24,814$ 1,954$ 4,985$ (82,984)$ 70,046$ Plus: Amortization, Depreciation 4,577 474 120 1
Slide 18: Reconciliation of Net Cash from Operating Activities to Free Cash Flow
18 RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITES TO FREE CASH FLOW 2020 (in thousands) Amount Amount Net cash provided by operating activities 135,793$ 47,400$ Purchase of property assets (11,388) (9,151) Free cash flow 124,405$ 38,249$ Proceeds from sale of stores -$ 187$ Acquisitions