Upbound Group, Inc. · NASDAQ:UPBD
Upbound — Rent A Center Inc DE — Q1 2022 Earnings Presentation
18 slides from Upbound's earnings presentation, May 5, 2022
Slide 1: Rent-A-Center: First Quarter 2022 Earnings Review
Rent-A- Center: First Quarter 2022 Earnings Review
Slide 2: Disclosures
Disclosures 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 positio
Slide 3: Q1'22 Key Themes
Q1’22 Key Themes 3 ➢ On track to achieve full year 2022 financial targets with first quarter results above the mid-point of quarterly guidance ranges ➢ Encouraging early signs that plans to address the recent underperformance of Acima are having the desired effect ➢ Rent-A-Center Business segment co
Slide 4: Q1'22 Highlights
2022 Q1 Highlights 4 Q1’22 Highlights ◼ First quarter 2022 consolidated revenues of $1.2 billion, +11.9% vs. last year; -5.8% on a pro forma basis ◼ First quarter 2022 Adjusted EBITDA1 of $99.5 million, -28.3% vs. last year, -42.9% on a pro forma basis ◼ Non-GAAP Diluted EPS1 of $0.74, compared to $
Slide 5: Q1 2022 Acima Highlights
Q1 2022 Acima Highlights 5 Business Highlights ◼ Pro forma GMV decreased 21.2% (+10% on a 2-year basis), primarily due to the effects of the timing and discontinuation of government stimulus programs in 2021 ◼ Q1 revenues of $599.4 million, -8.1% on a pro forma basis, led by lower merchandise sales
Slide 6: Q1 2022 Rent-A-Center Highlights
Q1 2022 Rent-A-Center Highlights 6 Rent-A-Center Business Same Store SalesBusiness Highlights 1 Non-GAAP financial measure. Refer to explanations and reconciliations elsewhere in this presentation. 22.3% 0% 5% 10% 15% 20% 25% 30% Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Rent-A-Center Business
Slide 7: 2022 Segment Objectives
2022 Segment Objectives 7 Acima Objectives ◼ Implement plans to address issues that contributed to underperformance in late 2021, notably adjustments in the underwriting function ◼New leadership will continue to assess the business to identify opportunities to enhance current performance and long-te
Slide 8: Q1 2022 Financial Highlights
Q1 2022 Financial Highlights 8 Consolidated ▪ Revenue growth +11.9% vs. last year; pro forma basis -5.8% ▪ Adjusted EBITDA1: $99.5M, -28.3% year-over-year; -42.9% on a pro forma basis due to an increase in delinquency and loss rates caused by customers’ discretionary income pressures and higher oper
Slide 9: 2022 Guidance
2022 Guidance 9 1 Includes Rent-A-Center Business, Acima, Mexico, Franchise and Corporate segments. 2 Free Cash Flow defined as net cash provided by operating activities less capital expenditures. 3 Adjusted EBITDA, non-GAAP diluted earnings per share and free cash flow are non-GAAP measures. Becaus
Slide 10: Capital Allocation Priorities
Capital Allocation Priorities 10 2022 Capital Allocation ConsiderationsLong-Term Capital Allocation Priorities ◼Quarterly dividend of $0.34 per share per quarter or $1.36 per year ◼Prioritize debt reduction towards target leverage ratio of 1.5x vs. current level of 2.3x ◼Evaluate share repurchases o
Slide 11: Question and Answer
Question and Answer
Slide 12: Appendix
Appendix
Slide 13: Q1 2022 Financial Highlights
Q1 2022 Financial Highlights 13 Note: Pro forma results and metrics represent estimated financial results and metrics as if the acquisition of Acima had been completed on January 1, 2020. The pro forma results and metrics may not necessarily reflect the actual results of operations or metrics that w
Slide 14: Reconciliation of Net Loss Per Share to Non-GAAP Diluted Earnings Per Share
Reconciliation of Net Loss Per Share to Non- GAAP Diluted Earnings Per Share 14 Three Months Ended March 31, 2022 (in thousands) Gross Profit Operating Profit (Loss) Earnings Before Income Taxes Tax (Benefit) Expense Net (Loss) Earnings Diluted (Loss) Earnings per Share GAAP Results $546,095 $11,043
Slide 15: Reconciliation of Net Earnings Per Share to Non-GAAP Diluted Earnings Per Share
Reconciliation of Net Earnings Per Share to Non-GAAP Diluted Earnings Per Share 15 Three Months Ended March 31, 2021 (in thousands) Gross Profit Operating Profit Earnings Before Income Taxes Tax Expense Net (Loss) Earnings Diluted (Loss) Earnings per Share GAAP Results $510,523 $70,046 $49,387 $6,83
Slide 16: Reconciliation of Operating Profit to Adjusted EBITDA (Consolidated and by Segment)
Reconciliation of Operating Profit to Adjusted EBITDA (Consolidated and by Segment) 16 Three Months Ended March 31, 2022 (in thousands) Rent-A-Center Business Acima Mexico Franchising Corporate Consolidated GAAP Operating Profit (Loss) $100,176 $9,600 $2,066 $4,790 $(105,589) $11,043 Plus: Amortizat
Slide 17: Reconciliation of Operating Profit to Adjusted EBITDA (Consolidated and by Segment)
Reconciliation of Operating Profit to Adjusted EBITDA (Consolidated and by Segment) 17 Three Months Ended March 31, 2021 (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: Amortizat
Slide 18: Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow 18 Three Months Ended March 31, 2022 2021 (in thousands) Amount Amount Net cash provided by operating activities $205,291 $135,793 Purchase of property assets (16,403) (11,388) Free cash flow $188,888 $124,405 Proceeds fro