Onemain Holdings, Inc. · NYSE:OMF
Onemain — Q2 2023 Earnings Presentation
18 slides from Onemain's earnings presentation, Jul 26, 2023
Slide 1: 2Q23 Financial Results
2Q23 Financial Results NYSE: OMF | July 26, 2023
Slide 2: Important Information
Important Information The following slides are part of a presentation by OneMain Holdings, Inc. (the "Company") in connection with reporting quarterly financial results and are intended to be viewed as part of that presentation. No representation is made that the information in these slides is compl
Slide 3: Our Future Vision is to Deepen & Broaden Customer Relationships
Our Future Vision is to Deepen & Broaden Customer Relationships Unsecured Financial Loans Wellness Secured Loans Insurance Progress to a Meet the needs better future Credit of today Card Products & Services that increase engagement, Lending products OneMain Bill Negotiation build loyalty & provide A
Slide 4: 2Q23 Financial Highlights
2Q23 Financial Highlights $3.7 billion $192 million $7.4 billion Originations Capital Generation* Undrawn Bank Facilities With conservative credit posture C&I Adj. Net Income* $122 million 5 renewals YTD $21.4 billion 17.4% $825 million Managed Receivables* Net Interest Margin* ABS Issuance Up 6% Yo
Slide 5: 2Q23 Financial Results
2Q23 Financial Results ($ in millions, except Average Assets and Average Net Receivables in billions, and per share statistics) Earnings Summary C&I* Adjusted Earnings Summary 2Q23 1Q23 2Q22 2Q23 1Q23 2Q22 Consumer & Insurance* $162 $236 $309 Interest Income $1,115 $1,092 $1,104 Other Net Revenue 13
Slide 6: Originations & Receivables (C&I)
Originations & Receivables (C&I)* ($ in billions, unless noted) Loan Originations Highlights $3.9 $3.7 $3.6 $3.5 • Continue to tighten underwriting in lower ROE segments; closely $3.0 $2.8 monitoring evolving macroeconomic environment • Continued positive competitive dynamics and growth in secured l
Slide 7: Targeted & Disciplined BrightWay Credit Card Rollout
Targeted & Disciplined BrightWay® Credit Card Rollout ~230 thousand $159 million 85%+ payments 4.5+ stars Credit Cards Receivables Made in the app App store ratings up ~70 thousand QoQ up $37 million QoQ Top spending categories Rewarding Restaurants milestones, great digital Retail stores experience
Slide 8: Loan Delinquency & Net Charge-off Trends (C&I)
Loan Delinquency & Net Charge-off Trends (C&I)* ($ in millions) Highlights • 30+ delinquency down 71 bps YTD, in line with seasonal trends • Net charge-offs continue to be supported by strong back-end collections and recoveries 30-89 Days Delinquent 90+ Days Delinquent $610 $544 $534 $529 $553 $562
Slide 9: Originations from new, higher credit quality vintages becoming a bigger part of the portfolio
Originations from new, higher credit quality vintages becoming a bigger part of the portfolio Highlights • Originations post Aug-2022 credit tightening performing in line with expectations; expected to be 65-70% of portfolio by year-end 20231 • 2023 YTD change in 30+ delinquency is in line with pre-
Slide 10: Loss Reserve Trends (C&I)
Loss Reserve Trends (C&I)* ($ in millions) Highlights • Coverage ratio of 11.66% reflecting the continued uncertain macroeconomic environment $2,392 $2,315 $2,298 $2,259 $2,132 $2,077 $1,968 11.58% 11.60% 11.66% 11.44% 10.94% 10.96% 10.68% 1/1/2020 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 (Day 1 CECL) % reflec
Slide 11: Operating Expenses (C&I)
Operating Expenses (C&I)* ($ in millions) Highlights • 2Q23 operating expense of $370 includes continued investment for growth in new products and distribution channels, data science, technology and digital capabilities • 2Q23 OpEx Ratio of 7.1% demonstrates continued expense discipline and the oper
Slide 12: Balance Sheet and Funding
Balance Sheet and Funding Bank Facilities Unsecured ($ in billions, unless noted) Secured $7.4 $7.4 $7.4 $7.4 Highlights $7.0 $1.3 $1.3 $1.3 $1.3 $1.3 • Significant liquidity with $7.4 of committed bank facilities $5.8 $6.2 $6.2 $6.2 $6.2 • Well-positioned funding profile with balanced debt mix and
Slide 13: Capital Allocation Framework
Capital Allocation Framework 1 2 Business Investment • Managed receivables* up 6% YoY Regular Dividend 3 • Continuing to invest in new products • Board declared regular quarterly and distribution channels, data dividend of $1.00 per share payable science, technology and digital August 11 Share Repur
Slide 14: 2023 Strategic Priorities (C&I)
2023 Strategic Priorities (C&I)*1 Key Metrics 2/7/2023 7/26/2023 Managed Receivables Growth Low to mid-single digits 5.0 – 8.0% Loan Net Charge-offs 7.0 – 7.5% 7.0 – 7.5% Operating Expense Ratio ~7.1% ~7.1% *See appendix for Non-GAAP Financial Measures reconciliations along with defined terms. For a
Slide 15: Appendix
Appendix
Slide 16: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures (unaudited, $ in millions) 2Q23 1Q23 4Q22 3Q22 2Q22 FY22 FY21 Consumer & Insurance $138 $236 $244 $247 $279 $1,169 $1,788 Other - (1) (1) 1 - - (7) Segment to GAAP adjustment - - (10) (2) (1) (14) (40) Income before income taxes - GAAP basis $138 $235 $233 $246 $2
Slide 17: Reconciliation of Non-GAAP Measures (cont’d)
Reconciliation of Non-GAAP Measures (cont’d) (unaudited, $ in millions) 6/30/2023 3/31/2023 12/31/2022 9/30/2022 6/30/2022 Consumer & Insurance $20,511 $19,810 $19,987 $19,754 $19,449 Segment to GAAP adjustment (1) (1) (1) (2) (1) Net finance receivables - GAAP basis $20,510 $19,809 $19,986 $19,752
Slide 18: Defined Terms
Defined Terms • Adjusted capital = adjusted tangible common equity + allowance for finance receivable losses (ALLL), net of tax • Available cash and cash equivalents = cash and cash equivalents – cash and cash equivalents held at our regulated insurance subsidiaries or is unavailable for general cor