GlobeNewswire Inc | Nov 3, 2020 04:09PM EST

November 03, 2020

Loan Portfolio of $1.18 billion, up 14%Net Charge-Off Rate of 7.8%, down 540 bpsAdjusted Diluted Earnings per Share of $2.00, up 56%Total Liquidity of $250 million, up 16%

MISSISSAUGA, Ontario, Nov. 03, 2020 (GLOBE NEWSWIRE) -- goeasy Ltd. (TSX: GSY), (goeasy or the Company), a leading full-service provider of goods and alternative financial services, announced its results for the third quarter ended September 30, 2020. Third Quarter Results

During the quarter, the Company experienced an improved level of loan originations and a reduction in credit losses, leading to record financial results.

Gradual re-opening of the economy and a reduction in the stay-at-home orders originally caused by the COVID-19 pandemic, served to improve overall demand. As such, the Company generated $287 million in total loan originations, flat to the $286 million produced in the third quarter of 2019. The improved originations led to growth in the loan portfolio of $48.3 million during the quarter, which finished at $1.18 billion, up 14% from $1.03 billion as of September 30, 2019. Revenue for the third quarter, which was partially impacted by lower commissions related to higher levels of loan protection insurance claims, was $162 million, up 4% over the same period in 2019.

The Company also continued to experience strong credit and payment performance. Use of the Companys loan protection insurance program, the continuation of government relief programs, assistance provided by banks and other lenders such as payment deferral programs and reduced living expenses, combined with previous credit model enhancements, resulted in an improvement to credit losses. The net charge-off rate for the third quarter was a record low 7.8%, compared to 13.2% in the third quarter of 2019. Although there remains uncertainty about the exact timing and pace of an economic recovery, the improvement in underlying credit performance and the general macroeconomic environment resulted in the Company holding its allowance for future credit losses broadly flat at 10.03%.

Reduced operating expenses and record low credit losses led to operating income of $56.9 million, up 34% from $42.6 million in the third quarter of 2019, while the operating margin expanded to 35.2%, up from 27.3% in the prior year. During the quarter, the Company also recorded a $1.7 million pre-tax increase to the carrying value of its minority equity investment in PayBright, a Canadian payments platform focused on instant point-of-sale consumer financing and buy-now-pay-later programs. PayBright has continued to grow revenues at over 80% on an annualized basis and onboard new major brand partners.

Net income in the third quarter was a record $33.1 million, up 67% from $19.8 million in 2019, which resulted in diluted earnings per share of $2.09, up 63% from the $1.28 in the third quarter of 2019. Return on equity was 34.7%, up from 24.1% in the third quarter of 2019. After adjusting for the increase in the carrying value of the Companys minority equity investment, net income was a record $31.6 million and diluted earnings per share was $2.00, an increase of 59% and 56% respectively, while return on equity was 33.1%.

During the quarter we continued to prioritize the safety and well-being of our team, while also producing further improvements in operating performance. As credit losses fell to another record low of 7.8%, we experienced a gradual improvement in demand, lifting originations to prior year levels and leading to loan growth of nearly $50 million in the quarter, said Jason Mullins, goeasys President and Chief Executive Officer, The resiliency of our business model continued to be highlighted by record earnings and strong cash flows. In addition to funding the organic loan growth during the quarter, we have also repurchased over $12 million worth of additional shares throughout the last several months, while liquidity remains strong at $250 million of total funding capacity.

Other Key Third Quarter Highlights

easyfinancial

-- Secured loan portfolio grew to $141.6 million, up 40% -- 50% of net loan advances in the quarter were issued to new customers, down from 65% -- 44% of applications were acquired online, down slightly from 45% -- Aided brand awareness of 85%, up from 84% -- Average loan book per branch improved to $3.7 million, an increase of 6% -- The delinquency rate on the final Saturday of the quarter was 4.3%, down from 4.6% -- Operating income of $63.8 million, up 34% -- Operating margin of 50.7%, up from 38.9%

easyhome

-- Revenue of $36 million, up 6% -- Same store revenue growth of 7.2% -- Consumer loan portfolio within easyhome stores increased to $44.9 million, up 34% -- Revenue from consumer lending increased to $5.5 million, up 21% -- Record operating income of $7.9 million, up 40% -- Record operating margin of 21.9%, up from 16.6%

Overall

-- 42nd consecutive quarter of same store sales growth -- 77th consecutive quarter of positive net income -- 16th consecutive year of paying dividends and 6th consecutive year of dividend increases -- Total same store revenue growth of 3.1% -- Return on equity of 34.7% in the quarter, up from 24.1% -- Fully drawn weighted average cost of borrowing reduced to 5%, down from 6.7% -- Net external debt to net capitalization of 66% on September 30, 2020, down from 69% in the prior year and below the Companys target leverage ratio of 70% -- Repurchased 108,660 common shares during the quarter at a weighted average price of $63.55, including an additional 76,440 shares subsequent to quarter-end at a weighted average price of $68.39, through the Companys Normal Course Issuer Bid, bringing total share repurchases year to date to 764,435 -- No reduction of personnel during COVID-19, including a 10% reduction in year-to-date employee turnover -- Annual employee engagement score improved to record level of 83%, up 2% over the prior year

Nine Months Results

For the first nine months of 2020, goeasy produced revenues of $480 million, up 8% compared with $444million in the same period of 2019. Operating income for the period was $155 million compared with $122 million in the first nine months of 2019, an increase of $32.8 million or 27%. Net income for the first nine months of 2020 was $87.6 million and diluted earnings per share was $5.64 compared with $57.7 million or $3.72 per share, increases of 52%. After adjusting for the increase in the carrying value of the Companys minority equity investment, net income for the first nine months of 2020 was $82.6 million and diluted earnings per share was $5.33, increases of 43%, while return on equity was 30.5%.

Balance Sheet and Liquidity

Total assets were $1.37 billion as of September 30, 2020, an increase of 10% from $1.24 billion as of September 30, 2019, driven by the growth in the consumer loan portfolio.

During the quarter, the Company redeemed all its 5.75% convertible unsecured subordinated debentures (the Convertible Debentures) that were outstanding on July 31, 2020 (the Redemption Date), which were due to mature on July 31, 2022. The Convertible Debentures were redeemable at a redemption price equal to their principal amount, plus accrued and unpaid interest thereon up to, but excluding, the Redemption Date. As of the close of business on June 28, 2020, there was $43,806,000 principal amount of Convertible Debentures issued and outstanding, of which the holders of approximately $41,379,000 aggregate principal amount elected to convert their Convertible Debentures into approximately 954,302 common shares prior to the Redemption Date. On the Redemption Date, the Company redeemed the $2,427,000 aggregate principal amount of Convertible Debentures that remained unconverted on that date.

Cash provided by operating activities before the net issuance of consumer loans receivable and purchase of lease assets was $96.7 million during the quarter, an increase of 20% from $80.9 million in the third quarter of 2019.

Based on the cash on hand at the end of the quarter and the borrowing capacity under the Companys revolving credit facility, goeasy had approximately $250 million in total funding capacity, which it estimates is sufficient to fund its growth through the second quarter of 2022. At quarter-end, the Companys fully drawn weighted average cost of borrowing reduced to 5.0%, down from 6.7% in the prior year, with incremental draws on its senior secured revolving credit facility bearing a rate of approximately 3.6% due to the lower interest rate environment.

The Company also estimates that once its existing and available sources of capital are fully utilized, it could continue to grow the loan portfolio by approximately $150 million per year solely from internal cash flows. The Company also estimates that as of September 30, 2020, if it were to run-off its consumer loan and consumer leasing portfolios, the value of the total cash repayments paid to the Company over the remaining life of its contracts would be approximately $2 billion. If during such a run-off scenario all excess cash flows were applied directly to debt, the Company estimates it would extinguish all external debt within 18 months.

COVID-19 & Future Outlook

Due to the current uncertainty relating to the impacts of COVID-19, the Company intends to re-publish a 3-year forecast when the economic conditions and outlook stabilize. However, the Company remains confident that it is well positioned to navigate through the current economic downturn and has continued to see conditions gradually improve. Recent trends include:

-- Improving Consumer Demand: The effects of the pandemic, which included stay-at-home orders, increased government subsidies and reduced expenses for consumers, led to temporarily reduced demand. During the second quarter, total loan originations were down 38% from the prior year. In the third quarter, loan originations improved to be broadly flat to 2019. -- Declining Loan Protection Insurance Claims: The majority of easyfinancial customers have Loan Protection Insurance, offered by Assurant Inc., a global provider of risk-management solutions, which covers a borrowers full loan payment for a period of 6 consecutive months in the event of unemployment. During the second quarter, total loan protection claims payments made on behalf of borrowers was $21.7 million. In the third quarter, claims payments declined by 33% to $14.6 million, with a further decline in the trend subsequent to quarter-end. -- Solutions to Support Borrowers Below Pre-COVID Levels: easyfinancial has a suite of loan amendment solutions that it can offer borrowers to support them through a difficult financial period. These include temporarily deferring loan payments or extending the term of a loan to reduce the regular payment obligation. In April approximately 12% of customers utilized a form of support, as compared to approximately 7%-8% in a typical month prior to the pandemic. However, since May the portion of borrowers utilizing a form of support has fallen to below pre-COVID levels and has remained below 7% for each month since. -- Strong Customer Payment Performance: The Company has continued to observe a strong level of true overall payment performance. During the second quarter, the Company collected an average of 96% of the payment volume it would normally collect prior to the pandemic. In the third quarter, customer payment volume relative to the outstanding consumer loan portfolio was at, or above, 100% of the levels it would normally collect prior to the pandemic.

While there remains some uncertainty about the broader economic environment, we are seeing positive trends in the business and we are confident in our ability to navigate through a second wave. Consumer demand for credit continues to slowly recover and we expect growth in the loan portfolio of approximately 5% to 6% during the upcoming quarter. Credit and payment performance continue to perform well, and we project the annualized net charge-off rate will be approximately 10% in the fourth quarter. Lastly, we continue to make great progress on finalizing a new securitized funding facility. This important next step in the evolution of our balance sheet will further lower our funding costs and provide a material increase to our total liquidity, Mr. Mullins concluded, Our business is thriving during a challenging time and I want to once again thank all 2,000 goeasy team members for their unwavering commitment to stand by our customers. The fundamentals of our business, and the confidence in our strategy to provide everyday Canadians with a path to a better tomorrow, are stronger than ever.

Dividend

The Board of Directors has approved a quarterly dividend of $0.45 per share payable on January 8, 2021 to the holders of common shares of record as at the close of business on December 25, 2020.

Forward-Looking Statements

All figures reported above with respect to outlook are targets established by the Company and are subject to change as plans and business conditions vary. Accordingly, investors are cautioned not to place undue reliance on the foregoing guidance. Actual results may differ materially.

This press release includes forward-looking statements about goeasy, including, but not limited to, its business operations, strategy, expected financial performance and condition, the estimated number of new locations to be opened, targets for growth of the consumer loans receivable portfolio, annual revenue growth targets, strategic initiatives, new product offerings and new delivery channels, anticipated cost savings, planned capital expenditures, anticipated capital requirements, liquidity of the Company, plans and references to future operations and results and critical accounting estimates. In certain cases, forward-looking statements are statements that are predictive in nature, depend upon or refer to future events or conditions, and/or can be identified by the use of words such as expects, anticipates, intends, plans, believes, budgeted, estimates, forecasts, targets or negative versions thereof and similar expressions, and/or state that certain actions, events or results may, could, would, might or will be taken, occur or be achieved.

Forward-looking statements are based on certain factors and assumptions, including expected growth, results of operations and business prospects and are inherently subject to, among other things, risks, uncertainties and assumptions about the Companys operations, economic factors and the industry generally, as well as those factors referred to in the Companys most recent Annual Information Form and Management Discussion and Analysis, as available on www.sedar.com, in the section entitled Risk Factors. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those expressed or implied by forward-looking statements made by the Company, due to, but not limited to, important factors such as the Companys ability to enter into new lease and/or financing agreements, collect on existing lease and/or financing agreements, open new locations on favourable terms, purchase products which appeal to customers at a competitive rate, respond to changes in legislation, react to uncertainties related to regulatory action, raise capital under favourable terms, manage the impact of litigation (including shareholder litigation), control costs at all levels of the organization and maintain and enhance the system of internal controls. The Company cautions that the foregoing list is not exhaustive.

The reader is cautioned to consider these, and other factors carefully and not to place undue reliance on forward-looking statements, which may not be appropriate for other purposes. The Company is under no obligation (and expressly disclaims any such obligation) to update or alter the forward-looking statements whether as a result of new information, future events or otherwise, unless required by law.

About goeasy

goeasy Ltd., a Canadian company, headquartered inMississauga, Ontario, provides non-prime leasing and lending services through its easyhomeandeasyfinancial divisions. With a wide variety of financial products and services including unsecured and secured instalment loans, goeasy aspires to help put Canadians on a path to a better financial future, as they rebuild their credit and graduate to prime lending. Customers can transact seamlessly with easyhome and easyfinancial through an omni-channel model that includes online and mobile, as well as over 400 leasing and lending locations acrossCanadasupported by more than 2,000 employees. Throughout the companys history, it has served over 1 million Canadians and originated $4.7 billionin loans, with one in three customers graduating to prime credit and 60% increasing their credit score within 12 months of borrowing.

goeasy is the proud recipient of several awards including Waterstone Canadas Most Admired Corporate Cultures, Glassdoor Top CEO Award, Achievers Top 50 Most Engaged Workplaces inNorth America, Greater Toronto Top Employers Award, the Digital Finance Institutes Canadas Top 50 FinTech Companies, ranking on the TSX30 and placing on the Report on Business ranking of Canadas Top Growing Companies. The company and its employees believe strongly in giving back to the communities in which it operates and has raised over$3 millionto support its long-standing partnerships with theBoys & Girls Clubs of CanadaandHabitat for Humanity.

goeasy Ltd.s. common shares are listed on the TSX under the trading symbol GSY. goeasy is rated BB- with a stable trend from S&P and Ba3 with a stable trend from Moodys. Visitwww.goeasy.com.

For further information contact:

Jason MullinsPresident & Chief Executive Officer(905) 272-2788

David IngramExecutive Chairman of the Board(905) 272-2788

goeasy Ltd. INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) (expressed in thousands of Canadian dollars) As At As At September 30, December 31, 2020 2019 ASSETS Cash 39,477 46,341 Amounts receivable 5,779 18,482 Prepaid expenses 4,057 7,077 Consumer loans receivable, net 1,100,998 1,040,552 Investment 40,000 34,300 Lease assets 46,351 48,696 Property and equipment, net 28,905 23,007 Deferred tax assets 7,323 14,961 Derivative financial assets 3,455 - Intangible assets, net 22,677 17,749 Right-of-use assets, net 46,943 46,147 Goodwill 21,310 21,310 TOTAL ASSETS 1,367,275 1,318,622 LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Revolving credit facility 98,221 112,563 Accounts payable and accrued liabilities 47,564 41,350 Income taxes payable 7,837 4,187 Dividends payable 6,713 4,448 Unearned revenue 8,952 8,082 Derivative financial liabilities - 16,435 Lease liabilities 53,056 52,573 Accrued interest 13,417 4,358 Convertible debentures - 40,656 Notes payable 721,292 701,549 TOTAL LIABILITIES 957,052 986,201 Shareholders' equity Share capital 182,524 141,956 Contributed surplus 17,744 20,296 Accumulated other comprehensive income (loss) 412 (915 ) Retained earnings 209,543 171,084 TOTAL SHAREHOLDERS' EQUITY 410,223 332,421 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,367,275 1,318,622



goeasy Ltd. INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME(Unaudited) (expressed in thousands of Canadian dollars except earnings per share) Three Months Ended Nine Months Ended September 30, September September 30, September 30, 30, 2020 2019 2020 2019 REVENUE Interest 101,833 90,304 302,799 249,594 incomeLease 28,416 27,134 84,232 84,968 revenueCommissions 28,540 34,909 83,166 98,341 earnedCharges and 3,035 3,786 9,506 10,944 fees 161,824 156,133 479,703 443,847 EXPENSESBEFOREDEPRECIATION ANDAMORTIZATIONSalaries and 36,457 30,141 102,283 89,248 benefitsStock-based 1,718 1,752 5,587 5,828 compensationAdvertisingand 7,377 6,425 18,195 19,211 promotionBad debts 27,221 43,326 100,505 113,485 Occupancy 5,639 5,086 17,126 15,089 Technology 3,817 3,314 10,499 9,071 costsOther 6,624 7,737 22,378 21,504 expenses 88,853 97,781 276,573 273,436 DEPRECIATIONAND AMORTIZATIONDepreciationof lease 8,701 9,023 26,790 28,051 assetsDepreciationof 4,053 3,798 11,994 11,266 right-of-useassetsDepreciationof property 1,451 1,607 4,488 4,657 andequipmentAmortizationof 1,820 1,355 4,699 4,127 intangibleassets 16,025 15,783 47,971 48,101 TOTALOPERATING 104,878 113,564 324,544 321,537 EXPENSES OPERATING 56,946 42,569 155,159 122,310 INCOME OTHER INCOME Unrealizedfair value 1,700 - 5,700 - gain oninvestment FINANCE COSTSInterestexpense andamortization of 12,543 14,208 39,624 40,350 deferredfinancingchargesInterestexpense on 613 2,025 1,808 lease 690liabilities 13,233 14,821 41,649 42,158 INCOMEBEFORE 45,413 27,748 119,210 80,152 INCOME TAXES INCOME TAXEXPENSE (RECOVERY)Current 9,990 8,097 23,288 21,951 Deferred 2,350 (174 ) 8,328 535 12,340 7,923 31,616 22,486 NET INCOME 33,073 19,825 87,594 57,666 BASIC EARNINGS PER 2.20 1.35 5.95 3.94 SHAREDILUTED EARNINGS PER 2.09 1.28 5.64 3.72 SHARE



Segmented Reporting Three Months Ended September 30, 2020 ($ in 000's except easyfinancial easyhome Corporate Total earnings per share) Revenue Interest income 97,543 101,833 4,290 - Lease revenue 28,416 - 28,416 - Commissions earned 26,474 28,540 2,066 - Charges and fees 1,839 3,035 1,196 - 125,856 161,824 35,968 - Total operating expenses before depreciation and 58,089 17,208 13,556 88,853 amortization Depreciation and amortization Depreciation and amortization of lease assets, 2,014 907 11,972 property and 9,051 equipment and intangible assets Depreciation of 1,977 252 4,053 right-of-use assets 1,824 3,991 1,159 16,025 10,875 Segment operating 63,776 (14,715 ) 56,946 income (loss) 7,885 Other income Unrealized fair value gain on 1,700 investment Finance costs Interest expense and amortization of 12,543 deferred financing charges Interest expense on lease liabilities 690 13,233 Income before income 45,413 taxes Income taxes 12,340 Net Income 33,073 Diluted earnings per share 2.09 Three Months Ended September 30, 2019 ($ in 000's except easyfinancial easyhome Corporate Total earnings per share) Revenue Interest income 87,087 3,217 - 90,304 Lease revenue - 27,134 - 27,134 Commissions earned 32,706 2,203 - 34,909 Charges and fees 2,463 1,323 - 3,786 122,256 33,877 - 156,133 Total operating expenses before

depreciation and 71,283 16,854 9,644 97,781 amortization Depreciation and amortization Depreciation and amortization of lease assets, 1,794 9,453 738 11,985 property and equipment and intangible assets Depreciation of 1,672 1,951 175 3,798 right-of-use-assets 3,466 11,404 913 15,783 Segment operating 47,507 5,619 (10,557 ) 42,569 income (loss) Finance costs Interest expense and amortization of 14,208 deferred financing charges Interest expense on 613 lease liabilities 14,821 Income before income 27,748 taxes Income taxes 7,923 Net Income 19,825 Diluted earnings per 1.28 share Nine Months Ended September 30, 2020 ($ in 000's except easyfinancial easyhome Corporate Total earnings per share) Revenue Interest income 290,483 302,799 12,316 - Lease revenue 84,232 - 84,232 - Commissions earned 76,785 83,166 6,381 - Charges and fees 6,113 9,506 3,393 - 373,381 106,322 479,703 - Total operating expenses before depreciation and 186,844 50,428 39,301 276,573 amortization Depreciation and amortization Depreciation and amortization of lease assets, 5,484 2,590 35,977 property and 27,903 equipment and intangible assets Depreciation of 5,691 708 11,994 right-of-use assets 5,595 11,175 3,298 47,971 33,498 Segment operating 175,362 (42,599 ) 155,159 income (loss) 22,396 Other income Unrealized fair value gain on 5,700 investment Finance costs Interest expense and amortization of 39,624 deferred financing charges Interest expense on 2,025 lease liabilities 41,649 Income before income 119,210 taxes Income taxes 31,616 Net Income 87,594 Diluted earnings per share 5.64 Nine Months Ended September 30, 2019 ($ in 000's except easyfinancial easyhome Corporate Total earnings per share) Revenue Interest income 241,321 8,273 - 249,594 Lease revenue - 84,968 - 84,968 Commissions earned 92,029 6,312 - 98,341 Charges and fees 6,853 4,091 - 10,944 340,203 103,644 - 443,847 Total operating expenses before

depreciation and 194,294 49,944 29,198 273,436 amortization Depreciation and amortization Depreciation and amortization of lease assets, 5,389 29,383 2,063 36,835 property and equipment and intangible assets Depreciation of 4,728 5,978 560 11,266 right-of-use-assets 10,117 35,361 2,623 48,101 Segment operating 135,792 18,339 (31,821 ) 122,310 income (loss) Finance costs Interest expense and amortization of 40,350 deferred financing charges Interest expense on 1,808 lease liabilities 42,158 Income before income 80,152 taxes Income taxes 22,486 Net Income 57,666 Diluted earnings per 3.72 share



Summary ofFinancialResults and KeyPerformanceIndicators ($ in 000?sexcept Three Months Ended Variance Varianceearnings pershare andpercentages) September 30, 2020 September 30, 2019 $ / bps % change

SummaryFinancial ResultsRevenue 156,133 3.6 % 161,824 5,691Operatingexpensesbefore 97,781 ) (9.1 %)depreciation 88,853 (8,928andamortizationEBITDA 49,329 33.7 % 65,970 16,641EBITDA margin 40.8 % 31.6 % 920 bps 29.1 %Depreciationand 15,783 1.5 %amortization 16,025 242expenseOperating 42,569 33.8 %income 56,946 14,377Operating 35.2 % 27.3 % 790 bps 28.9 %marginOther income^ 100.0 %1 1,700 - 1,700Finance costs 14,821 ) (10.7 %) 13,233 (1,588Effectiveincome tax 27.2 % 28.6 % (140 bps) (4.9 %)rateNet income 19,825 66.8 % 33,073 13,248Diluted earnings per 2.09 1.28 0.81 63.3 %shareReturn on 34.7 % 24.1 % 1,060 bps 44.0 %equity Adjusted(Normalized) FinancialResults^1Adjusted 49,329 30.3 %EBITDA 64,270 14,941Adjusted 39.7 % 31.6 % 810 bps 25.6 %EDITDA marginAdjusted net 19,825 59.4 %income 31,598 11,773Adjusteddiluted 56.3 %earnings per 2.00 1.28 0.72shareAdjustedreturn on 33.1 % 24.1 % 900 bps 37.3 %equity KeyPerformance IndicatorsSame storerevenue 3.1 % 20.4 % (1,730 bps) (84.8 %)growth(overall)Same storerevenue 7.2 % 2.4 % 480 bps 200.0 %growth(easyhome) Segment Financialseasyfinancial 122,256 2.9 %revenue 125,856 3,600easyfinancialoperating 50.7 % 38.9 % 1,180 bps 30.3 %margineasyhome 33,877 6.2 %revenue 35,968 2,091easyhomeoperating 21.9 % 16.6 % 530 bps 31.9 %margin Portfolio IndicatorsGrossconsumer 1,182,801 1,035,596 147,205 14.2 %loansreceivableGrowth inconsumer 75,888 ) (36.3 %)loans 48,319 (27,569receivableGross loan 286,068 0.2 %originations 286,583 515Total yieldon consumerloans 45.1 % 50.1 % (500 bps) (10.0 %)(includingancillaryproducts)Netcharge-offsas apercentage of 7.8 % 13.2 % (540 bps) (40.9 %)average grossconsumer loansreceivablePotential monthly lease 8,256 8,432 (176 ) (2.1 %)revenue ^1During the third quarter of 2020, the Company recognized an unrealized fairvalue gain before-tax of $1.7 million on its investment in PayBright. ($ in 000?sexcept Nine Months Ended Variance Varianceearnings pershare andpercentages) September 30, 2020 September 30, 2019 $ / bps % change

SummaryFinancial ResultsRevenue 443,847 8.1 % 479,703 35,856Operatingexpensesbefore 273,436 1.1 %depreciation 276,573 3,137andamortizationEBITDA 142,360 27.9 % 182,040 39,680EBITDA margin 37.9 % 32.1 % 580 bps 18.1 %Depreciationand 48,101 ) (0.3 %)amortization 47,971 (130expenseOperating 122,310 26.9 %income 155,159 32,849Operating 32.3 % 27.6 % 470 bps 17.0 %marginOther income^ 100.0 %1 5,700 - 5,700Finance costs 42,158 ) (1.2 %) 41,649 (509Effectiveincome tax 26.5 % 28.1 % (160 bps) (5.7 %)rateNet income 57,666 51.9 % 87,594 29,928Diluted earnings per 5.64 3.72 1.92 51.6 %shareReturn on 32.3 % 24.5 % 780 bps 31.8 %equity Adjusted(Normalized) FinancialResults^1Adjusted 142,360 23.9 %EBITDA 176,340 33,980Adjusted 36.8 % 32.1 % 470 bps 14.6 %EBITDA marginAdjusted net 57,666 43.3 %income 82,649 24,983Adjusteddiluted 43.3 %earnings per 5.33 3.72 1.61shareAdjustedreturn on 30.5 % 24.5 % 600 bps 24.5 %equity KeyPerformance IndicatorsSame storerevenue 7.8 % 19.8 % (1,200 bps) (60.6 %)growth(overall)Same storerevenue 3.2 % 3.4 % (20 bps) (5.9 %)growth(easyhome) Segment Financialseasyfinancial 340,203 9.8 %revenue 373,381 33,178easyfinancialoperating 47.0 % 39.9 % 710 bps 17.8 %margineasyhome 103,644 2.6 %revenue 106,322 2,678easyhomeoperating 21.1 % 17.7 % 340 bps 19.2 %margin Portfolio IndicatorsGrossconsumer 1,182,801 1,035,596 147,205 14.2 %loansreceivableGrowth inconsumer 201,817 (129,649 ) (64.2 %)loans 72,168receivableGross loan 781,861 ) (10.6 %)originations 699,028 (82,833Total yieldon consumerloans 45.2 % 50.2 % (500 bps) (10.0 %)(includingancillaryproducts)Netcharge-offsas apercentage of 10.3 % 13.3 % (300 bps) (22.6 %)average grossconsumer loansreceivablePotential monthly lease 8,256 8,432 (176 ) (2.1 %)revenue ^1During the nine-month period ended September 30, 2020, the Company recognizedan unrealized fair value gain before-tax of $5.7 million on its investment inPayBright.