NEW YORK (
) -- Auto finance and subprime lender
reported Tuesday that its profits more than doubled in the fourth quarter ended June 2010, improving credit quality.
Net income jumped to $85.5 million, or 61 cents per diluted share, from $31.7 million, or 24 cents a share. Net income for the year rose to $220 million, or $1.65 a per share, compared with a loss of $10.8 million, or 9 cents a share. The figures for the June 2009 quarter and 2009 annual results were revised to reflect a new accounting standard that changed the accounting for convertible bonds.
Revenue declined to $361.67 million from $450.26 million in the year-ago quarter. Analysts were expecting earnings of 40 cents on revenue of $352.3 million.
Origination volumes during the fourth quarter jumped to $906 million from $175 million in the year ago quarter. Finance receivables declined to $8.7 billion from $11.4 billion. Credit quality improved with net charge-offs declining to 4.5% of average finance receivables from 7.1% a year earlier. Provision for loan losses declined 70% to $49.32 million from $174.67 million.
The stock is up 1.3% in extended trading. Last month, GM announced its plan to acquire AmeriCredit for $3.5 billion in an all-cash deal, in a move to access subprime borrowers. AmeriCredit shareholders would receive $24.50 a share under the deal, which is expected to close by the end of 2010.
-- Reported by Shanthi Venkataraman in New York.
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