Nicholas Financial Inc (NICK) SEC Filing 10-Q Quarterly report for the period ending Tuesday, June 30, 2020

Exhibit 99.1

Nicholas Financial Reports

1st Quarter Fiscal Year 2021 Results

July 30, 2020 – Clearwater, Florida - Nicholas Financial, Inc. (NASDAQ: NICK) announced net income for the three months ended June 30, 2020 of $1.4 million compared to $0.6 million for the three months ended June 30, 2019.  Diluted net income per share was $0.18 for the three months ended June 30, 2020 as compared to $0.07 for the three months ended June 30, 2019. Revenue decreased 15.0% to $14.2 million for the three months ended June 30, 2020 as compared to $16.6 million for the three months ended June 30, 2019. The Company reported income before income taxes for the three months ended June 30, 2020 of $1.9 million compared to $0.8 million for the three months ended June 30, 2019.  The Company recorded an income tax expense of approximately $0.4 million during the three months ended June 30, 2020 as compared to $0.2 million during the three months ended June 30, 2019.

During the quarter ended June 30, 2020, the Company originated $19.2 million in finance receivables, collected $28.4 million in principal payments, reduced debt by $4.6 million and increased cash by $7.6 million.

“There is no doubt that the Covid-19 pandemic had an impact on our operations overall and particularly on our new loan originations,” commented Nicholas’ president and CEO, Doug Marohn.  “However, times like these prove out our business concepts and validate our branch-based model nicely.  We finance primary transportation to and from work for the subprime borrower through the local independent dealer.  Our loans tend to be smaller than most of our competitors and therefore payments are lower and exposure on those accounts is shorter.  The vehicle is one that they need – not just want - and the payments are affordable even in times of economic crisis.  Our local presence allows us to maintain a better relationship with the customer, as well.”  

“Although the pandemic had an early negative impact on new loans and originations in April and May, we were able to outproduce both 2018’s and 2019’s loan volume for the month of June.  From a portfolio management perspective, we enjoyed decreases in 31+ delinquency, 61+ delinquency, repossessions and losses,” continued Marohn.  “Out of an abundance of caution we added over $3 million of provision expense to bolster our reserves in case the pandemic has a more negative impact on our receivables in the upcoming Quarters.  Even with the $3 million of provision expense, we were able to turn out the best earnings Quarter in recent history.”

The 2020 Annual General Meeting of Shareholders of Nicholas Financial, Inc. will be held at the Company’s corporate headquarters, located at 2454 McMullen Booth Road, Building C, Clearwater, Florida, on Thursday, August 27, 2020, at 10:30 a.m. (Clearwater, Florida time).  Due to the COVID-19 epidemic, the Company has also elected to have concurrently a virtual shareholder meeting this year for the safety of its shareholders, partners, and board.  The URL Path for the virtual meeting is www.issuerdirect.com/virtualevent/nick.