OREANDA-NEWS. QC Holdings, Inc. (OTC PINK:QCCO) reported income from continuing operations of $1.2 million and revenues of $31.7 million for the three months ended March 31, 2016. For the three months ended March 31, 2015, income from continuing operations totaled $1.1 million and revenues were $34.5 million. 

The revenue decline in first quarter 2016 compared to 2015 reflects lower interest and fees from the company’s consumer loan products, indicative of competitive pressures as customers explore alternative loan products and distribution channels.  Loan loss rates were slightly lower in first quarter 2016 versus first quarter 2015, indicative of improvements in installment loan performance. The reduction in revenues exceeded the improved losses, resulting in a gross profit decline of $1.2 million quarter-to-quarter.

During 2016, QC will continue its efforts to introduce competitive products and services across its network, as well as to develop a dynamic online capability that will provide customers greater flexibility in interacting with the company.

About QC Holdings, Inc.
Headquartered in Overland Park, Kansas, QC Holdings, Inc. is a leading provider of consumer loans in the United States and Canada. In the United States, QC offers various products, including single-pay, installment and title loans, check cashing, debit cards and money transfer services, through 389 branches in 22 states at March 31, 2016. In Canada, the company, through its subsidiary Direct Credit Holdings Inc., is engaged in short-term, consumer Internet lending in various provinces.

QC Holdings, Inc.
Consolidated Condensed Statements of Income
(in thousands, except per share amounts)
(Unaudited)
 
  Quarter Ended 
March 31,
    2015       2016  
Revenues      
Consumer loan interest and fees $ 32,078     $ 29,209  
Other   2,437       2,464  
Total revenues   34,515       31,673  
Provision for losses   8,062       7,242  
Operating expenses   16,615       15,873  
Gross profit   9,838       8,558  
Corporate and Regional expenses   7,119       6,530  
Other expense, net   956       113  
Income from continuing operations before income taxes   1,763       1,915  
Provision for income taxes   676       693  
Net income $ 1,087     $ 1,222  
               
Earnings per share:      
Basic      
Net income $ 0.06     $ 0.07  
Diluted      
Net income $ 0.06     $ 0.07  
               
Weighted average number of common shares outstanding:              
Basic   17,363       17,333  
Diluted   17,363       17,333  
QC Holdings, Inc.
Consolidated Condensed Balance Sheets
(in thousands)
 
  December 31,
2015		   March 31,
2016
ASSETS     (Unaudited)
Current assets      
Cash and cash equivalents $   16,115     $   16,678  
Restricted cash     950         950  
Loans receivable, less allowance for losses of $6,395 at  December 31, 2015 and $5,496 at March 31, 2016     50,555         42,751  
Other current assets       6,286           5,639  
Total current assets     73,906         66,018  
Non-current loans receivable, less allowance for losses of $1,556 at  December 31, 2015 and $1,053 at March 31, 2016     3,802         3,337  
Property and equipment, net     4,797         4,727  
Other assets, net       11,486           10,785  
Total assets $   93,991     $   84,867  
               
LIABILITIES AND STOCKHOLDERS’ EQUITY      
Current liabilities      
Accounts payable and other current liabilities $   11,407     $     9,914  
Revolving credit facility     6,250      
Subordinated debt       3,553           3,589  
Total current liabilities     21,210         13,503  
       
Non-current liabilities     4,967         3,545  
Subordinated debt                  
Total liabilities     26,177         17,048  
       
Stockholders’ equity       67,814           67,819  
Total liabilities and stockholders’ equity $   93,991     $   84,867  
               
QC Holdings, Inc.
Consolidated Condensed Statements of Cash Flows
(in thousands)
(Unaudited)
 
  March 31,
2015		   March 31,
2016
Operating activities:      
Net income $     1,087     $     1,222  
Adjustments to reconcile net income to net cash     9,791         9,514  
Changes in assets and liabilities       2,772         (3,695 )
Net operating       13,650           7,041  
               
Investing activities:      
Capital expenditures     (121 )       (466 )
Other       1,183           30  
Net investing       1,062           (436 )
               
Financing activities:      
Net repayment of borrowings     (12,000 )       (6,250 )
Other       (73 )          
Net financing     (12,073 )         (6,250 )
               
Effect of exchange rate changes on cash and cash equivalents       (186 )         208  
               
Net increase in cash and cash equivalents     2,453         563  
Cash and cash equivalents at beginning of year       14,220           16,115  
Cash and cash equivalents at end of period $   16,673     $   16,678