SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 _____________ FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) May 6, 2003 CONSUMER PORTFOLIO SERVICES, INC. --------------------------------- (Exact Name of Registrant as Specified in Charter) CALIFORNIA 001-14116 33-0459135 ---------- --------- ---------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 16355 Laguna Canyon Road, Irvine, CA 92618 ------------------------------------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code (949) 753-6800 Not Applicable -------------- (Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibits. EXHIBIT NUMBER DESCRIPTION 99.1 Earnings Release dated May 6, 2003 ITEM 9. INFORMATION FURNISHED UNDER ITEM 12 (RESULTS OF OPERATIONS AND FINANCIAL CONDITION). The information contained in this Item 9 of this Current Report is being furnished pursuant to "Item 12. Results of Operations and Financial Condition" of Form 8-K in accordance with SEC Release Nos. 33-8216; 34-47583 (March 27, 2003). The information in this Current Report is being furnished and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended. On May 6, 2003, the registrant issued an earnings release announcing its financial results for the quarter ended March 31, 2003. A copy of the earnings release is attached as Exhibit 99.1. Exhibit 99.1 to the report may contain a "non-GAAP financial measure" as defined in Item 10 of Regulation S-K of the Securities Exchange Act of 1934, as amended. The possible non-GAAP financial measure is "managed receivables." This possible non-GAAP financial measure is discussed below, including the most directly comparable financial measure calculated and presented in accordance with Generally Accepted Accounting Principles in the United States ("GAAP"), a reconciliation of managed receivables to the most directly comparable GAAP financial measure, and the reasons why the Company believes the presentation of managed receivables provides useful information to management and to investors. Managed receivables should be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with GAAP. On page 1 of the earnings release included in Exhibit 99.1, the Company indicated that managed receivables were $595.6 million at March 31, 2003. The most directly comparable financial measure calculated and presented in accordance with GAAP to the managed receivables measure is finance receivables on the consolidated balance sheet. The managed receivables measure also includes (i) the finance receivables held by unconsolidated subsidiaries off balance sheet pursuant to statement on financial accounting standards No. 140 and (ii) repossessed vehicles included in other assets in the Company's balance sheet. The following table reconciles the Company's finance receivables, prepared on the basis of GAAP, to managed receivables as of March 31, 2003: March 31, 2003 (in millions) Finance receivables per balance sheet $ 81.7 Finance receivables held by unconsolidated subsidiaries 511.9 Repossessed vehicles included in other assets per balance sheet 2.0 -------------- $ 595.6 ============== The managed receivables measure is useful to management and investors because it provides a basis for estimating (i) the Company's servicing fee revenue and (ii) the Company's servicing personnel requirements. The managed receivables measure is primarily used by investors and analysts, for those purposes. -3-
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CONSUMER PORTFOLIO SERVICES, INC. Dated: May 13, 2003 By: /s/ Charles E. Bradley, Jr. --------------------------------------- Charles E. Bradley, Jr. President and chief executive officer Signing on behalf of the registrant and as principal executive officer EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION 99.1 Earnings Release dated May 6, 2003 -4-
Exhibit 99.1 May 06, 2003 04:35 PM US Eastern Time zone CONSUMER PORTFOLIO SERVICES, INC. REPORTS 2003 FIRST QUARTER EARNINGS; REVENUES AND NET INCOME SHOW CONTINUED STRENGTH IRVINE, Calif.--(BUSINESS WIRE)--May 6, 2003--Consumer Portfolio Services, Inc. (Nasdaq: CPSS) today announced earnings for its first quarter ended March 31, 2003. For the three months ended March 31, 2003 total revenues increased approximately $9.4 million, or 72%, to $22.5 million, compared to $13.1 million for the three months ended March 31, 2002. Pretax income for the first quarter of 2003 was $2.4 million, compared to a pretax loss of ($6.8 million) for the comparable 2002 period. Net income for the quarter ended March 31, 2003 was $6.3 million, or $0.29 per diluted share, compared to a net loss before extraordinary item of ($981,000), or ($0.05) per diluted share, for the quarter ended March 31, 2002. Diluted shares outstanding were 21.9 million and 19.3 million for the quarters ended March 31, 2003 and 2002, respectively. "The first quarter results continue to evidence our solid operating performance and the strength of our portfolio. The 2003-A securitization that we completed this past quarter continued our trend of successful execution in the asset backed market," said Charles E. Bradley, President and Chief Executive Officer of Consumer Portfolio Services. "As previously stated, our strategy is to grow our portfolio cautiously, as well as to look for selective acquisition opportunities that will complement our business strategy and supplement our existing portfolio. The recently announced acquisition of TFC Enterprises fits with this strategy, and we look forward to completing the transaction later this month." Consumer Portfolio Services' managed receivables totaled $595.6 million at March 31, 2003. During the first quarter of 2003, the Company purchased $87.3 million in contracts and completed the $138.1 million CPS Auto Receivables Trust 2003-A securitization. During the same period in 2002, the Company completed one asset backed term securitization of $45.65 million. Conference Call - --------------- Consumer Portfolio Services announced that it will hold a conference call Wednesday, May 7, 2003, at 1:30 p.m. EST to discuss its quarterly results. Those wishing to participate by telephone may dial-in at (973) 582-2783 approximately 10 minutes prior to the scheduled time. A replay will be available between May 7, 2003 and May 13, 2003, beginning one hour after conclusion of the call, by dialing (877) 519-4471. The reservation number is 3773584. A broadcast of the conference call will also be available live and for 30 days after the call via the Company's web site at www.consumerportfolio.com and at www.streetevents.com.
About Consumer Portfolio Services, Inc. Consumer Portfolio Services, Inc. is a consumer finance company that specializes in purchasing, selling and servicing retail automobile installment sale contracts originated by automobile dealers located throughout the United States. The Company is currently active in 38 states. Through its purchase of contracts, the Company provides indirect financing to car dealer customers with limited credit histories, low incomes or past credit problems, who generally would not be expected to qualify for financing provided by banks or by automobile manufacturers' captive finance companies. Forward-looking statements in this news release include the company's recorded gain on sale and provision for credit losses because these items are dependent on the company's estimates of future losses. The accuracy of such estimates may be adversely affected by various factors, which include (in addition to risks relating to the economy generally) the following: possible increased delinquencies, repossessions and losses on retail installment contracts; incorrect prepayment speed and/or discount rate assumptions, possible unavailability of qualified personnel, which could adversely affect the company's ability to service its portfolio; possible increases in the rate of consumer bankruptcy filings or changes in bankruptcy law, which could adversely affect the company's rights to collect payments from its portfolio; other changes in government regulations affecting consumer credit; possible declines in the market price for used vehicles, which could adversely affect the company's realization upon repossessed vehicles; and economic conditions in geographic areas in which the company's business is concentrated. Any implication that the results of the most recently completed quarter are indicative of future results is a forward-looking statement. There is no reason to expect that any future period will include a tax benefit similar to the benefit recorded in the most recently completed quarter, and other factors, including those identified above in relation to gain on sale and provision for credit losses, may also affect future performance. An additional forward-looking statement is the statement that the company "looks forward" to completing its acquisition of TFC Enterprises, Inc. Such acquisition is subject to a number of conditions precedent, none of which are assured, including a favorable vote of the acquired company's stockholders, the consent of the senior lender to Consumer Portfolio Services, Inc., and availability of ongoing contract acquisition financing for the acquired company.
Consumer Portfolio Services, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three months ended March 31, ------------------- 2003 2002 ------------------- Revenues: Gain on sale of contracts, net $4,555 $1,772 Interest income 9,328 7,744 Servicing fees 4,602 3,390 Other income 4,062 230 -------- --------- 22,547 13,136 -------- --------- Expenses: Employee costs 8,447 8,462 General and administrative 4,033 4,404 Interest 5,530 4,431 Other expenses 2,183 2,614 -------- --------- 20,193 19,911 -------- --------- Income (loss) before income tax benefit and extraordinary item 2,354 (6,775) Income tax benefit (3,924) (5,794) -------- --------- Income (loss) before extraordinary item 6,278 (981) Extraordinary item, unallocated negative goodwill - 17,412 -------- --------- Net income $6,278 $16,431 ======== ========= Earnings (loss) per share before extraordinary item: Basic $0.31 $(0.05) Diluted 0.29 (0.05) Earnings per share after extraordinary item: Basic $0.31 $0.85 Diluted 0.29 0.85 Number of shares used in computing earnings per share: Basic 20,270 19,286 Diluted 21,860 19,286
Condensed Consolidated Balance Sheets (In thousands) (Unaudited) March 31, Dec. 31, 2003 2002 --------- --------- Cash and restricted cash $59,238 $51,859 Finance receivables, net 61,860 84,592 Residual interest in securitizations 127,112 127,170 Other assets 25,363 21,827 --------- --------- $273,573 $285,448 ========= ========= Accounts payable and other liabilities $24,515 $27,672 Securitization trust debt 54,165 71,630 Senior secured debt 53,308 50,072 Subordinated debt 53,496 53,500 --------- --------- 185,484 202,874 --------- --------- Shareholders' equity 88,089 82,574 --------- --------- $273,573 $285,448 ========= ========= CONSUMER PORTFOLIO SERVICES Investors: Media: Charles E. Bradley Sloane & Company 949/753-6800 Dana Fields OR 212/446-1878 Sloane & Company Jenny Lee 212/446-1892