Executive Summary

Q2 2023 revenue was $209.2M, net revenue $129.6M, and net loss $(59.3)M or $(1.45) diluted EPS; gross loans receivable grew 3.7% sequentially to $2.14B, and operating expenses fell 8.5% q/q to $108.1M .
Credit normalized: consolidated net charge-off rate rose 150 bps q/q to 13.0%, while 91+ day delinquency was flat at 3.2% q/q .
Liquidity improved: management highlighted liquidity and capacity of $399M (presentation) vs available capital resources of $361.9M (press release); funding mix was 69% fixed/hedged and 31% unhedged variable at quarter-end .
Q3 2023 guidance: end-of-period receivables $2.15–$2.25B, revenue $210–$220M, net charge-offs 12.5–15.5%, operating expenses $108–$118M (key near-term catalysts: receivables growth, NIM stabilization, cost control) .

What Went Well and What Went Wrong

What Went Well

Receivables growth and segment momentum: Canada POS Lending gross loans rose 6.9% q/q to $912.3M; Direct Lending revolving LOC rose 2.5% q/q; consolidated gross loans receivable increased 3.7% q/q to $2.14B .
Cost discipline: total operating expenses declined 8.5% q/q to $108.1M, with prior quarter impacted by $10M restructuring; consolidated OpEx ratio improved to 21% (presentation) .
Management tone: “We delivered solid results… fundamentals continued to gradually improve” and see opportunities in U.S. and Canada with automation investments positioning for long-term growth (CEO Doug Clark) .

What Went Wrong

Higher provisions and interest costs pressured earnings: provision for losses increased to $79.6M, and interest expense rose $7.2M q/q to $66.1M due to new term loan and greater use of non-recourse facilities; debt modification fees totaled $8.9M .
Net revenue declined 11.5% q/q to $129.6M driven by higher loss provisioning from charge-offs and allowance build amid macro changes .
Credit normalization lifted NCOs: net charge-off rate increased to 13.0% (from 11.5%); Canada Direct Lending NCOs reflected a full period of the charge-off policy change, with 31+ days past due rising to 4.0% in Canada POS .

Financial Results

Consolidated P&L and Key Credit Metrics

Metric ($USD Thousands unless noted)	Q2 2022	Q1 2023	Q2 2023
Total revenue	304,404	209,473	209,243
Net revenue	174,858	146,541	129,645
Provision for losses	129,546	62,932	79,598
Operating expenses	160,393	118,198	108,147
Interest expense	42,193	58,943	66,101
Net (loss) income	(26,080)	(59,471)	(59,327)
Diluted EPS ($)	(0.65)	(1.46)	(1.45)
Net charge-off rate (%)	24.0%	11.5%	13.0%
91+ days delinquency (%)	2.0%	3.2%	3.2%

Balance Sheet and Receivables

Metric	Q2 2022	Q1 2023	Q2 2023
Gross loans receivable ($000s)	1,592,815	2,062,829	2,139,865
Cash and cash equivalents ($000s)	37,394	54,935	112,531
Total debt ($000s)	2,189,431	2,627,263	2,772,872
Stockholders’ equity ($000s)	115,580	(228,816)	(268,373)

Segment Performance

Direct Lending ($000s)	Q2 2022	Q1 2023	Q2 2023
Total revenue	281,251	169,368	167,016
Provision for losses	123,584	48,364	63,755
Net revenue	157,667	121,004	103,261
Total operating expenses	143,965	103,151	91,285
Segment operating income (loss)	13,702	17,853	11,976
NCOs ($000s)	74,069	47,312	57,263
NCO rate (annualized, %)	26.5%	15.6%	18.8%

Canada POS Lending ($000s)	Q2 2022	Q1 2023	Q2 2023
Total revenue	23,153	40,105	42,227
Provision for losses	5,962	14,568	15,843
Net revenue	17,191	25,537	26,384
Total operating expenses	16,428	15,047	16,862
Segment operating income	763	10,490	9,522
Gross loans receivable ($000s)	627,163	853,253	912,250
NCO rate (annualized, %)	2.4%	5.6%	5.0%
31+ days past-due (%)	2.8%	3.9%	4.0%

KPIs: Delinquency and Loss Ratios (Consolidated)

KPI	Q2 2022	Q1 2023	Q2 2023
31–60 days delinquency (%)	2.4%	1.8%	1.9%
61–90 days delinquency (%)	1.8%	1.5%	1.3%
91+ days delinquency (%)	2.0%	3.2%	3.2%
Net charge-offs (%)	24.0%	11.5%	13.0%

Guidance Changes

Q3 2023 Guidance (New)

Metric	Period	Previous Guidance	Current Guidance	Change
End-of-period receivables	Q3 2023	—	$2.15–$2.25B	n/a (new)
Revenue	Q3 2023	—	$210–$220M	n/a (new)
Net charge-offs (%)	Q3 2023	—	12.5–15.5%	n/a (new)
Operating expenses	Q3 2023	—	$108–$118M	n/a (new)

Q2 2023 Guidance vs Actuals

Metric	Q2 2023 Guidance (issued 5/10)	Q2 2023 Actuals	Result
Receivables	$2.0–$2.1B	$2.14B	Above guidance top end
Revenue	$200–$210M	$209.243M	Within high end
Net charge-offs (%)	13–16%	13.0%	At low end
Operating expenses	Flat vs Q4’22 (implied $126M) or $112–$120M slide-level	$108.147M	Better than range

Earnings Call Themes & Trends

Note: Q2 2023 earnings call transcript content was unavailable due to document retrieval errors despite multiple attempts (documents 1–2 returned database inconsistency). Themes below reflect press releases and presentations.

Topic	Previous Mentions (Q4 2022)	Previous Mentions (Q1 2023)	Current Period (Q2 2023)	Trend
Liquidity & leverage	Two-thirds fixed-rate debt; net leverage rose with funding for growth	Liquidity/capacity $288M; net leverage 12.2x; raised $230M gross capital (term loan + CAD SPV)	Liquidity/capacity $399M; net leverage 15.4x; mix 69% fixed/hedged	Improving liquidity; leverage elevated
Credit policy/normalization	NCOs elevated; policy tighteners improved delinquency	Canada charge-off policy change drove lower reported NCOs; CECL adoption increased allowance	Credit normalized; consolidated NCO rate 13% and ACL held ~12.7%	Stabilizing
Operating efficiency	Restructuring drove near-term OpEx; continued focus	OpEx ratio improved; centralization of servicing	OpEx declined 8.5% q/q; OpEx ratio 21% (consolidated)	Improving
Segment growth (Canada POS)	Strong growth in Canada POS balances q/q	Canada POS receivables grew; NCOs/DQs rising with seasoning	Canada POS revenue $42.2M; gross loans $912.3M; NCO 5.0%	Growth with maturing credit
Funding costs	Interest expense rising with benchmark rates	Interest expense up; new facilities established	Interest expense up to $66.1M; debt modification fees $8.9M	Cost pressures persist

Management Commentary

“We delivered solid results… our fundamentals continued to gradually improve… opportunities present in both the U.S. and Canada while… balance future growth with further improving our bottom line. Our extensive industry experience, investments in automation and strong consumer demand… position us well for long term growth and shareholder value creation.” — Doug Clark, CEO .
Q3 2023 focus areas: optimize lending facilities, improve operating leverage, complete U.S. branch conversion to single platform, quality asset growth, stabilize NIM with specific targets provided .

Q&A Highlights

The Q2 2023 earnings call transcript could not be retrieved due to document database inconsistencies (multiple attempts to read documents 1–2 failed). As a result, Q&A themes and clarifications are not available from primary sources in this recap.

Estimates Context

S&P Global consensus estimates for CURO Q2 2023 were unavailable due to missing CIQ mapping for the ticker in our SPGI data connector. Values could not be retrieved; therefore, beat/miss versus Street is not assessed here. Values retrieved from S&P Global.

Key Takeaways for Investors

Near-term execution improving: operating expenses declined faster than guided, and receivables and revenue landed at the high end or above Q2 guidance ranges — supportive for Q3 targets .
Credit has normalized but is stabilizing: consolidated NCO rate at 13.0% with flat 91+ day delinquency; watch Canada POS seasoning and Canada Direct Lending post policy change .
Funding costs are the main headwind: interest expense rose to $66.1M with debt modification fees; leverage remains high — monitor term loan and SPV utilization vs NIM stabilization goals .
Canada POS is a growth engine: revenue up to $42.2M and receivables to $912.3M; continued portfolio maturation requires disciplined provisioning and monitoring of DQs .
Q3 guidance offers catalysts: achieving receivables $2.15–$2.25B and stabilizing NIM while holding OpEx $108–$118M would be constructive to sentiment; NCO guide at 12.5–15.5% sets expectations .
Liquidity improved q/q (presentation $399M) vs available capital resources (press release $361.9M); reconcile definitions, but trajectory is positive for growth funding .
Actionable: Focus on credit trends (NCOs/DQs) and cost trajectory vs Q3 guidance on revenue/NIM; sensitivity to interest rates and funding mix likely continues to drive equity narrative .

CURO Group Holdings Corp. (CURO)·Q2 2023 Earnings Summary