Onemain Holdings, Inc. · NYSE:OMF
Onemain — Q4 2023 Earnings Presentation
20 slides from Onemain's earnings presentation, Feb 7, 2024
Slide 1: 4Q23 Financial Results
4Q23 Financial Results NYSE: OMF | February 7, 2024
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 Vision is to be the Lender of Choice for the Nonprime Consumer
Our Vision is to be the Lender of Choice for the Nonprime Consumer Meet their Progress to a needs today better future Unsecured loans OneMain Financial wellness Secured loans Customers Insurance Auto finance Bill negotiation Credit cards Secured card 3
Slide 4: 2023 Highlights
2023 Highlights Advancing our mission to improve the financial well-being of hardworking Americans ✓ Best Practice Institute Most Loved 7% $12.9 billion Managed Originations Workplace® for 2nd year in a row Receivables Growth* 15% $794 million Customer Account Growth Capital Generated* ✓ Named as a
Slide 5: 2023 Financial Results
2023 Financial Results ($ in millions, except Average Assets and Average Net Receivables in billions, and per share statistics) Earnings Summary C&I* Adjusted Earnings Summary 2023 2022 2023 2022 Consumer & Insurance* $874 $1,206 Interest Income $4,559 $4,429 Other Net Revenue 538 486 Other (6) 0 Pr
Slide 6: 4Q23 Financial Highlights
4Q23 Financial Highlights $3.0 billion $191 million $7.7 billion Originations Capital Generation* Undrawn Bank Facilities With conservative credit posture C&I Adj. Net Income* $167 million Up $300 million QoQ $22.2 billion 17.1% $1.1 billion Managed Receivables* Net Interest Margin* Funding Raised U
Slide 7: 4Q23 Financial Results
4Q23 Financial Results ($ in millions, except Average Assets and Average Net Receivables in billions, and per share statistics) Earnings Summary C&I* Adjusted Earnings Summary 4Q23 3Q23 4Q22 4Q23 3Q23 4Q22 Consumer & Insurance* $223 $252 $249 Interest Income $1,186 $1,166 $1,121 Other Net Revenue 13
Slide 8: Originations & Receivables (C&I)
Originations & Receivables (C&I)* ($ in billions, unless noted) Loan Originations Highlights $3.6 $3.7 $3.5 • Continued credit box tightening and pricing actions resulting in 4Q23 $3.3 $3.0 originations down 13% vs 4Q22 $2.8 • Includes auto finance originations of $144 million in 4Q23 and $555 milli
Slide 9: Targeted & Disciplined BrightWay Credit Card Rollout
Targeted & Disciplined BrightWay® Credit Card Rollout ~431 thousand $330 million ~90% customers 4.5+ stars Credit Cards Receivables Use mobile app App store ratings up ~91 thousand QoQ up $98 million QoQ Top spending categories Rewarding Retail milestones, great digital Restaurants experience Gas st
Slide 10: Loan Delinquency & Net Charge-off Trends (C&I)
Loan Delinquency & Net Charge-off Trends (C&I)* ($ in millions) Highlights • 30-89 delinquency of 3.28%, reflects back book performance and portfolio growth dynamics from credit tightening • Front book1 continues to perform in line with expectations • FY23 net charge-offs of 7.4%; charge-offs contin
Slide 11: Portfolio Performance is Supported by Credit Tightening
Portfolio Performance is Supported by Credit Tightening Highlights • Front book1 is growing and continues to perform in line with expectations • Back book delinquency remains elevated and is the primary driver of overall portfolio delinquency • OneMain’s unique business model results in superior cre
Slide 12: Loss Reserve Trends (C&I)
Loss Reserve Trends (C&I)* ($ in millions) Highlights • Coverage ratio flat to 3Q23 at 11.62%; $31 increase reflects portfolio growth $2,449 $2,480 $2,392 $2,315 $2,298 $2,259 11.58% 11.60% 11.66% 11.62% 11.62% 11.44% 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 % reflects loss reserves as a % of ending net receiv
Slide 13: Operating Expenses (C&I)
Operating Expenses (C&I)* ($ in millions) Highlights • 4Q23 OpEx Ratio of 6.8%, down from 7.1% in 4Q22, driven by improved efficiencies across the organization and focused expense management • FY23 OpEx Ratio of 7.0%, reflecting continued cost management and expense discipline; FY24 OpEx Ratio expec
Slide 14: Balance Sheet & Funding
Balance Sheet & Funding Unsecured Bank Facilities ($ in billions, unless noted) Secured $7.4 $7.4 $7.4 $7.4 $7.7 Highlights $1.3 $1.3 $1.3 $1.3 $1.3 • $7.7 of committed bank facilities, up from $7.4 in 3Q23 • Well-positioned funding profile with balanced debt mix and staggered maturities $6.2 $6.2 $
Slide 15: Capital Allocation Framework
Capital Allocation Framework 1 2 Business Investment • Balance sheet growth Regular Dividend 3 • Continue to invest in new products • Board declared regular quarterly and channels, data science, dividend of $1.00 per share Share Repurchases technology and digital capabilities payable February 23rd •
Slide 16: 2024 Strategic Priorities (C&I)
2024 Strategic Priorities (C&I)* Continue to exercise disciplined credit risk Complete the acquisition and integration of Originate cards in high-conviction segments management across products Foursight, further develop auto finance and focus on unit economics Drive operating efficiency and execute
Slide 17: Appendix
Appendix
Slide 18: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures (unaudited, $ in millions) 4Q23 3Q23 2Q23 1Q23 4Q22 FY23 FY22 Consumer & Insurance $220 $250 $138 $236 $244 $845 $1,169 Other (1) (4) - (1) (1) (6) - Segment to GAAP adjustment 1 - - - (10) 1 (14) Income before income taxes - GAAP basis $220 $246 $138 $235 $233 $8
Slide 19: Reconciliation of Non-GAAP Measures (cont'd)
Reconciliation of Non-GAAP Measures (cont’d) (unaudited, $ in millions) 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022 Consumer & Insurance $21,349 $21,068 $20,511 $19,810 $19,987 Segment to GAAP adjustment - (1) (1) (1) (1) Net finance receivables - GAAP basis $21,349 $21,067 $20,510 $19,809 $
Slide 20: Defined Terms
Defined Terms • Adjusted capital = adjusted tangible common equity + allowance for finance receivable losses (ALLL), net of tax • Auto finance = financing at the point of purchase through a network of auto dealerships • Available cash and cash equivalents = cash and cash equivalents – cash and cash