Nicholas Financial, Inc. reported significant financial developments in its 10-Q filing for the second quarter of fiscal 2024, reflecting a strategic shift following the sale of its consumer finance segment and the acquisition of Amplex Electric, Inc.

As of June 30, 2024, total assets increased to $88.678 million from $59.838 million as of March 31, 2024. However, total current assets decreased to $42.598 million, down from $59.698 million in the prior quarter. Current liabilities surged to $11.490 million, compared to just $0.931 million previously. Total shareholders' equity remained stable at $56.671 million, while NICK shareholders' equity fell to $53.121 million from $58.842 million.

In terms of revenue, Nicholas Financial reported $489,000 for Q2 2024, a notable increase from $0 in Q2 2023. This growth is attributed to the acquisition of Amplex, which contributed $319,000 from wireless internet services, $106,000 from fiber internet services, and $64,000 from other services. Operating expenses rose significantly to $4.036 million, up from $1.5 million in the same quarter last year, primarily due to increased general and administrative costs related to the Amplex acquisition.

The company experienced a net loss of $(3.489 million) for Q2 2024, a stark contrast to a net income of $1.556 million in Q2 2023. The loss before income taxes also widened to $(5.676 million) from $(1.488 million) year-over-year. The net loss attributable to common shareholders was $(3.278 million), compared to a profit of $1.556 million in the prior year, resulting in a net loss per share of $(0.49).

Strategically, Nicholas Financial completed the sale of substantially all finance receivables and repossessed assets to Westlake Financial on April 26, 2024, for $65.6 million, marking a decisive exit from its consumer finance operations. The company also acquired a 51% stake in Amplex Electric on June 15, 2024, for $18.4 million, expanding its footprint into broadband services. This acquisition is expected to enhance revenue streams through the provision of broadband and VOIP services to over 9,100 customers.

The company’s cash position improved significantly, with cash and cash equivalents rising to $40.658 million as of June 30, 2024, compared to $678,000 a year earlier. This increase was driven by the cash generated from the sale of finance receivables and the strategic acquisition of Amplex, which is anticipated to contribute positively to future revenue growth.