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Danny Bharwani

Thank you, Brad. Going over the financial results. The revenues for the quarter $100.6 million is up 9% from the $92.1 million in the third quarter last year for the year-to-date period $288.2 million of revenues is 11% higher than the three months. The three quarters for 2023 of $260 million.
The top line revenue growth is driven by a very good origination volume for the quarter $446 million is 38% higher than the $322 million. We did in the third quarter last year for the year-to-date period. Originations are $1.224 billion compared to $1.056 billion which is 16% higher than last year.
So the portfolio, the fair value portfolio which drives our top line revenue is now $3.1 billion and we're yielding 11.3% on that portfolio.
Remembering that the 11.3% yield is net of losses. The revenue for this quarter also includes a $5.5 million mark up to the fair value portfolio and that markup is a result of better than expected performance on that portfolio. The prior period, the prior year quarter also included a mark-up of $6 million for the fair value portfolio expenses during the quarter, $93.7 million is up from $77.9 million in the third quarter of last year for the year-to-date period, expenses were $268.1 million versus $208.8 million. And those expenses are primarily driven higher by increases in interest expense, which is a function of both higher interest rates, but also because we have a larger portfolio and have a larger securitization and the credit line debt balance, the pre-tax earnings for the quarter $6.9 million compared to $14.2 million in the third quarter of last year.
Year-to-date period, pre-tax earnings $20.1 million compared to $51.3 million in the year-to-date period of 2023. Net income is $4.8 million for the quarter, $4.7 million was the June quarter. And that compares to $10.4 million in the third quarter of last year for the year-to-date period, $14.1 million of net income versus $38.2 million in the year-to-date period last year, the looted earnings per share is $0.20 per share compared to $0.19 last quarter and $0.41 per share last year for the year-to-date period, $0.58 compared to a $1.51 for the nine months of 2023.
Moving over to the balance sheet, as I mentioned earlier, our fair value portfolio is now $3.1 billion is 17% higher than the $2.67 billion as of September, 30 of 2023.
Our securitization balance debt balance is $2.875 billion is 28% higher than the $2.243 billion as of September, 30, of last year. So we've seen the we've seen the portfolio grow faster than the debt balance is growing.
Shareholders equity is a $285.1 million for this quarter compared to $265.9 million a 7% increase year over year going over other metrics.
The net interest margin is $50.5 million compared to $54.2 million in the third quarter of last year. That's a 7% decrease for the year-to-date period. Net interest margin is $149.5 million is a is 3% lower than $153.7 million for the nine months of 2023.
Core operating expenses for the quarter, 44.6% higher than the $42 million last year for the year-to-date period. Core operating expenses is $134 million is 9% higher than $123.1 million for 2023.
And the core operating expenses as a percentage of the managed portfolio is now down to 5.4% in the current quarter compared to 5.7% last year. That's a 5% decrease on an annualized basis. Core operating expenses were flat at 5.7%.
I will turn it over to Mike.

Michael Lavin

Thanks, Danny. In originations and sales like Danny mentioned in Q3, we originated $446 million in new contracts which is a slight increase month over month over the $431 million we did in in Q2.
Just want to note in the month of October, we just had our best origination month of the year and actually the second best month in the 33 year history of our company given our '24 growth to date, we have been able to build our portfolio of receivables to $3.3 billion at quarter end which is an increase of 12% over the portfolio size of $2.9 billion at the end of Q3 '23.
If we continue at our current origination pace for the remainder of the year, we will have achieved a year over year growth rate of between 18% and 20%. So a good year overall, it's important to note, very important to note actually that we have achieved this growth without loosening our credit to be more of a specific. We've done this without raising our LTVs or changing our payment to income or debt to income ratios. That's very, very hard to do in our space to take a step further. We've achieved that growth while maintaining a strong average APR that is running just north of 20%.
In fact, we've only been, we've only had to minimally lower our price on the margins in various states and only to our best A&B grade dealers. So we're running a strong APR growing and not loosening our credit at the same time, the growth has come organically through improving metrics such as funding dealers, dealer loyalty and capture with our current roster of 103 sales reps.
We've been marching up our sales force. We added roughly 17 sales reps and added our fortified 12 new geographic territories in Q3. We've actually added 23 sales reps so far in '24 that's the best growth rate we've had in our sales force in a couple of years.
We're also starting to see results of our multiyear initiative to add more large dealer group business to our portfolio. We did $119 million in large dealer group originations in Q3 which is a 21% increase over Q2 and a whopping 40% increase over Q1.
We have taken our large dealer group from 21% of our originations at the beginning of the year to roughly 28% at the end of Q3.
We also, I also believe that there's significant room for improvement in this area of the business as we move forward.
We also continue to bolster our efforts to provide our dealers with frictionless transactions. This goes to our brand and our stated purpose of having the best customer service in the industry. We've been able to lower our funding time to an all-time low of 1.79 funding days, which is a dramatic drop from our historical average of roughly 3.5 funding days.
The faster the dealer can get their money, the more chances we're going to get to more to get more business. In the same token, we've been able to raise our same day funding to 17.35% of deals funded, which is a significant improvement over our average same day funding of 6.5% in 2023. Again, the faster the dealer gets their money, the more apt we are to get more business from that dealer.
We have been able to achieve some of these results using AI on the front end of our business which is speeding up processing. We're being able to check proof of income. Really quickly, we're able to get through verifications and prove stipulations all with AI and without human interaction and with precise accuracy.
The other thing that's helped is we've seen a higher penetration of e-contracting in our business so far this year and we expect that to get higher moving forward, switching over to portfolio performance. Our annualized net charge offs for Q3 were 7.53% of the portfolio as compared to 6.86% for Q3 of '23 delinquencies greater than 30 days, which includes repossession inventory were 14.04% of the total portfolio as of the end of the Q3. And that's compared to 12.31% as of the end of Q3 '23, diving a little deeper. We were able to knock down the DQ month over month for the first five months of this year and have seemed to get it under control going forward through Q3.
Take a step further, looking at our CNLs on a vintage basis. Going all the way back to 2022. We have seen an increment, we have seen incremental improvements, vintage over vintage from 2022 through the first three quarters of this year.
So we're trending downward on the CNLs as we move forward through 2024 and into 2025. This is a testament to our early tightening of our credit in late 2022 and continuing into the first quarter of 2024. It also correlates to the implementation of our genAI credit decisioning model that we put plate that we set forth in October of 2023. And of course, I would be remiss without mentioning that it is also related to good old fashioned hard work by, by our servicing department.
To that end, we have tightened our collection model. We've hired more collectors in the, in the back half of 2023 and then into 2024. This has allowed us to reallocate veteran collectors from the earlier easier accounts to the tougher advantages and we've been able to leverage our small nearshore team to lessen the DQ role by hammering down on the potential DQ accounts. That's 1 to 29 accounts, our extensions remain flat as a percentage of our portfolio. One note given the two hurricanes that rolled through in Q3, we've seen minimal impact in both hurricanes in Florida and specifically North Carolina.
From a technology standpoint, we recently migrated our omni channel collection system to the cloud which provides us a more powerful auto dialler and will allow us to better communicate with our customers via text, which is by far the most important touch point and also email and chat.
We should see some collection lift from this migration. Moving forward, the cloud migration will also allow us to launch our AI voice Bot. After a successful pilot, we expect the AI voice Bot to further allow us to reallocate those veteran collectors to tougher accounts and increase our call efficiency and promote self service payments.
Finally looking at our portfolio performance as marked against our competitors. Market analysis by certain bankers reveals that we are consistently out performing our peers by up to 5% in the CNL starting from 2022 to present.
One final note before I take it back to Brad. In our ongoing battle against fraud, we integrated a new AI fraud score earlier this year that we estimate has saved us nearly $4 million in losses to date. Those savings will compound as we move forward. And we're also currently piloting another AI fraud score that we will that we believe will further lower losses going forward.
Now with that, I'll pass it back to Brad.

Charles Bradley

Thanks Mike. So looking at the industry, I think, probably what's kind of good about our industry is everybody's playing, everybody's kind of doing what they're supposed to be doing. There aren't any real problems most everyone is still working through the '22 early '23 originations trying to get the credit back in line. As I mentioned, our credit now is we're very, we feel very good about where we sit in the credit spectrum. One of the reasons we've been able to grow a lot is because we like where we sit and we're becoming a little more aggressive in the market.
I think the other players are still doing about the same thing, some are aggressive, some are still trying to get through those problems, but either way the health of the industry is very good.
There have been no new interest in our industry in a long time, which again, I think just shows that the industry has matured and only strong players are still here and that's important because, you know, when someone blows up, it causes ripples within the whole industry, it also those kind of problems affect the ABS market since that's what we need every quarter. We want that market to stay strong. As I mentioned, it is.
I think in looking at the economy, everybody's going to say it's all about the election and as much as it may be, I don't think whatever the result is, it will affect us in a tremendous way one way or another, as we've said, numerous, hundreds of times, what we care about is unemployment, unemployment is in a great position today. I don't think that'll change no matter who wins the election.
I think the economy is in a very good position today. And so I think with a growing economy and very strong unemployment numbers, you know, the backdrop for us in terms of going next year and you throw in the fact that the fed has now lowered rates once and it's expected to lower rates a few more times.
You know, we now are coming into a perfect kind of place in terms of, we're comfortable with our credit, we're comfortable with our growth strategies and we're executing them. We're doing many other things in the sort of the backside of the business to improve things.
So we're -- as I mentioned before, we were trying to get position for next year. And I think we've done a wonderful job of doing that almost across the board. You know, with the economy being strong, unemployment being good, the rates coming down and us being in a position to grow substantially in the new year, you know, we really, you know, the future looks quite bright for what we're doing.
With that. I think we'll see how the rest plays out. We have one more quarter this year and then we're going to hopefully go up to a big start for next year. We look forward to speaking with everyone again sometime in February. Thank you for attending.

Operator

Thank you. This concludes today's teleconference. A replay will be available beginning two hours from now for 12 months via the company's website at www.consumerportfolio.com. Please disconnect your lines at this time and have a wonderful day..