America’s Car-Mart, Inc. reported a decline in financial performance for the three months ended July 31, 2024, compared to the same period in the previous fiscal year. Total revenues decreased by 5.2% to $347.8 million from $366.8 million, primarily driven by a 9.6% drop in retail units sold. Sales also fell by 7.4% to $287.2 million, with same-store revenue growth declining by 8.6%. Despite these challenges, the average retail sales price increased by 2.4%, contributing to a rise in interest income of 7.2%.

The company experienced a net loss of $964,000, a significant downturn from the net income of $4.2 million reported in the prior year. This resulted in a basic loss per share of $0.15, compared to earnings of $0.65 in the same quarter of 2023. The loss before taxes was $(1.2 million), contrasting with a pretax income of $5.2 million in the previous year. Total costs and expenses decreased to $348.9 million from $361.6 million, reflecting a reduction in cost of sales.

As of July 31, 2024, total assets increased to $1.53 billion from $1.48 billion, while total liabilities rose to $1.06 billion from $1.01 billion. The company’s stockholders' equity slightly increased to $471.1 million from $470.7 million. The allowance for credit losses was reported at $334.4 million, representing 25% of the principal balance in finance receivables, which totaled $1.5 billion.

Strategically, America’s Car-Mart completed the acquisition of Texas Auto Center for $13.5 million in June 2024, which included $8.5 million in goodwill. The company also entered into a $150 million amortizing warehouse loan facility in July 2024, aimed at funding finance receivables and paying down existing credit lines. This facility is collateralized by installment sale contracts and has a maturity date of July 12, 2026.

The company has been focusing on improving its operational efficiency, including the implementation of a new loan origination system across most of its dealerships, which has tightened credit approval standards. Additionally, the company is investing in hiring and training qualified personnel to support its growth initiatives.

Overall, America’s Car-Mart is navigating a challenging market environment while making strategic investments to enhance its operational capabilities and financial position.