Upbound Group Inc (UPBD, Financial) released its Q3 2023 earnings report on November 2, 2023. The company reported consolidated revenues of $979.1 million, marking a 4.4% decrease year-over-year. This decrease was primarily due to lower rentals and fees revenue and merchandise sales revenue, attributed to a decrease in lease portfolio value compared to the prior year period.
Financial Performance
GAAP operating profit stood at $58.1 million, compared to $37.1 million in the prior year period. The GAAP operating profit margin was 5.9%, compared to 3.6% in the prior year period. The consolidated skip-stolen loss rate improved to 7.0% from 7.5% in the prior year period. Adjusted EBITDA decreased 7.8% year-over-year to $106.0 million. The Adjusted EBITDA margin of 10.8% decreased 40 basis points compared to the prior year, primarily due to the effect of higher corporate costs on a lower revenue base.
Segment Highlights
The Rent-A-Center segment reported revenues of $453.6 million, a decrease of 4.2% year-over-year. The Acima segment reported revenues of $475.2 million, a decrease of 5.8% year-over-year. The Franchising segment reported revenues of $30.6 million, an increase of 3.0% year-over-year. The Mexico segment reported revenues of $19.6 million, an increase of 3.2% year-over-year on a constant currency basis.
Full Year 2023 Financial Outlook
The company has raised its midpoint of full year 2023 targets for Adjusted EBITDA and Non-GAAP Diluted EPS. The company now expects revenues between $3.95 billion and $4.00 billion, Adjusted EBITDA excluding SBC between $450 million and $460 million, and Non-GAAP Diluted Earnings Per Share between $3.45 and $3.55.
CEO and CFO Commentary
CEO Mitch Fadel commented on the company's performance, stating,
“Our businesses continued to perform well in the third quarter. We effectively executed our plans to drive improved lease origination trends and stable customer payment behavior, despite growing external headwinds."CFO Fahmi Karam added,
“Third quarter results demonstrated the Company’s continued progress, as year-over-year trends improved sequentially from the second quarter, consistent with our projections."
About Upbound Group Inc
Upbound Group Inc (UPBD, Financial) is an omni-channel platform company committed to elevating financial opportunity for all through innovative, inclusive, and technology-driven financial solutions that address the evolving needs and aspirations of consumers. The Company’s customer-facing operating units include industry-leading brands such as Rent-A-Center® and Acima®.
Explore the complete 8-K earnings release (here) from Upbound Group Inc for further details.
