Nicholas Financial Earned 40 Cents Per Share

NICK did it again. Another great quarter:

Nicholas Financial, Inc. announced that for the three months ended March 31, 2011 net earnings increased 46% to $4,772,000 as compared to $3,260,000 for the three months ended March 31, 2010. Per share diluted net earnings increased 43% to $0.40 as compared to $0.28 for the three months ended March 31, 2010. Revenue increased 13% to $16,095,000 for the three months ended March 31, 2011 as compared to $14,256,000 for the three months ended March 31, 2010.

For the year ended March 31, 2011, net earnings increased 55% to $16,805,000 as compared to $10,865,000 for the year ended March 31, 2010. Per share diluted net earnings increased 52% to $1.41 as compared to $0.93 for the year ended March 31, 2010. Revenue increased 11% to $62,774,000 for the year ended March 31, 2011 as compared to $56,472,000 for the year ended March 31, 2010.

“Our strong growth in earnings per share for the fourth quarter and year ended March 31, 2011 were favorably impacted by the revenue contribution from new branches and a reduction in the net charge-off rate,” stated Peter L. Vosotas, Chairman and CEO. “We reported record revenues and earnings every quarter this year. In addition, we opened six new branch offices in the past year. We entered two new states with a branch in Chicago, Illinois and one in St. Louis, Missouri. We expect to add four to eight new branches during the upcoming year and will also continue to pursue buy-side opportunities as they arise.”

The March quarter is the end of NICK’s fiscal year. For the year, NICK made $1.41 per share which is an increase over the 93 cents per share they made in the year before.

Let’s add some perspective, shall we? Based on yesterday’s close, NICK is going for 9.22 times trailing earnings. That’s an earnings yield of 10.85%. Meanwhile, we know that NICK’s portfolio is vastly improving.

For this past quarter, the provisions for credit losses were just $101,000 or 0.16% as a percentage of average finance receivables, net of unearned interest. One year ago, that was running at 3%. A year before that, it was 6%.

Low interest rates continue to help NICK. The borrowing rate for this past quarter was just 4.21% (I believe NICK’s credit line is LIBOR plus 300 with some additional charges.)

Here’s my updated spreadsheet with all the details.

Optimistically, NICK can earn $1.60 to $1.70 per share for this fiscal year.

Posted by on May 5th, 2011 at 9:53 am


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