America's Car-Mart, Inc.

Welcome to America's Car-Mart's fourth quarter fiscal 2026 earnings call for the period ended April 30th, 2026. I'm Jonathan Collins, the company's CFO. Joining me today are Doug Campbell, our President and CEO, Jamie Fischer, our COO, and Marie Perchetti, our SVP of Capital Markets. We issued our earnings release earlier this morning, and a supplemental presentation is available on our website. Because our strategic review is still ongoing, We will not be able to host a question and answer session today. For any follow-up questions, our investor relations team can be reached through the contact information posted on our website at ir.car-mart.com. During today's call, certain statements we make may be considered forward-looking. These statements involve risks and uncertainties that could cause actual results to differ materially from management's current view. They are made under the safe harbor provision of the Private Securities Litigation Reform Act of 1995. The company cannot guarantee the accuracy of any forecast or estimate and does not undertake any obligation to update these statements. For more information, including important cautionary notes, please see Part 1 of our Annual Report on Form 10-K for the fiscal year ended April 30, 2026, which will be filed later today. You can also refer to our current and quarterly reports on Forms 8K and 10Q filed with the Securities and Exchange Commission. Finally, unless otherwise stated, our comparisons are for the fourth quarter of fiscal 2026 versus the fourth quarter of fiscal 2025. Doug, I'll turn it over to you now.

Thank you, Jonathan, and good morning, everyone. Thank you for joining us. Fiscal year 26 was a transitional year defined by our work to strengthen liquidity and our capital structure. Throughout the year, we've been managing capital, which meant reduced originations, lower inventory levels, and tightened underwriting. Beginning in the third quarter, we started optimizing our dealership footprint, consolidating select locations into higher performing nearby stores. These were complex decisions, but they were the right ones for the business. The fourth quarter reflected the same dynamic. faced with limited origination capital and no revolving warehouse facility, we intentionally reduced originations and inventory to protect liquidity and avoided originating loans we lacked the capacity to carry. That flowed through to our top line and operating leverage as units sold declined 27.1% to 11,411 units. Jonathan will walk through the full financial picture shortly. But I want to be direct on how to read this year's results. because the headline numbers invite the wrong conclusion. Our results were shaped by our capital structure, not by a change in what our customers need or how they pay us or how we underwrite. On credit, our charge-off ratio rose compared to last year. Part of that is simply a smaller book. With fewer new loans, our receivables balance is smaller, and a smaller balance raises the percentage. The rest reflects our customers paying more at the pump for much of the fourth quarter along with some disruption from the dealership consolidations we carried out and we're watching both closely. But this is not a credit quality problem or an underwriting failure. Our best tier customers make up a bigger share of our book than a year ago. It's a liquidity and capital structure story. Our geographical footprint changes this year were deliberate and it followed a plan that we laid out for you in December. On our Q2 call and in our separate supplemental materials, we outlined and the three-phase strategy to optimize our store base and cost structure. And we were explicit that we would stay agile and pursue additional opportunities for cost reduction as conditions evolved. We completed phase one in November and phase two in January. Phase three in April was the largest step and it went deeper than initially modeled. That was a deliberate choice as the capital environment made accelerating our footprint optimization and associated timing the priority. for the full year that brought us to 60 consolidations, reducing our active store count from 154 to 94. The result from that is a more productive network. The stores that remain are our stronger performers. On a historical units per store basis, approximately 30% higher than our above fiscal year 25 average. Some of those consolidated operations moved into nearby locations. some moved to a centralized collections team that we stood up during the fiscal year to serve accounts where the nearest store was no longer a practical fit. These were still hard decisions, particularly for the associates affected, and I don't want that to get lost in the numbers. Alongside that work, we tightened underwriting to protect portfolio quality, put retention programs in place for key talent that we need regardless of how the strategic review resolves, and strengthened our board governance including the formation of our special committee. Every one of these actions comes back to the same constraint, access to financing. Until we have additional financing capacity in place, whether through a warehouse facility, a recapitalization, or another financing transaction, our liquidity and our ability to originate at the volume our customers want and need will remain limited. Bringing the right counterparties together has taken longer than we initially expected. We continue to advance these discussions and the demand for what we do is very real and durable. Working families need reliable transportation and fair access to financing, and that need isn't going away. Through all of this, our highest operational priority has been protecting the infrastructure that services our portfolio, the teams, the technology, and the processes behind it. While originations are constrained, collections on our existing book are what fund this business and service our debt. So safeguarding that capability comes first. That focus holds regardless of how the path ahead resolves. We've made deliberate staffing and cost reductions to service this book as efficiently as possible, and we'll keep running lean while we do the work to secure the right long-term solution for the business. Protecting the value in this portfolio and pursuing the right path forward are not competing priorities. they're the same disciplines applied to both the present and the future. On June 19th, we entered into an amendment to our credit and guarantee agreement. It provides temporary covenant relief with a path to permanent relief if we satisfy specified milestones and a defined window to complete our review of the strategic and financing alternatives. That review is being led by the special committee of the board, independent directors with restructuring experience, working alongside our advisors evaluating the full range of alternatives to identify the path that best preserves value for our stakeholders. We'll share updates when we have something definitive to report. You'll also see a going concern disclosure in our Form 10-K. It's there because we have not secured additional financing or an alternative transaction that we need to resolve our liquidity constraint, not because anything changed in how our customers are paying us back. Before I turn to our path forward, a word on our CFO transition, which we announced last month. Jonathan Collins will leave Car-Mart on July 31st to become CFO of Genesco. Marie Perchetti, our Senior Vice President of Capital Markets, becomes CFO on August 1st. Marie was a finalist in the search that brought Jonathan here a year ago, and she's been close to our financing and capital structure work since, including the June amendment. I want to thank Jonathan for his partnership and contributions during a demanding period for this company and wish him well in his next chapter. Looking forward, the long-term industry outlook remains attractive. The need for reliable transportation and affordable financing isn't going away, and that need continues to underpin this business. Our focus is on making sure the company is capitalized, structured, and operated to meet it. The investments we've made in underwriting, pricing, payment technology, and collections all support that objective. With that, I'll turn the call over to Jamie to discuss our operating performance in more detail.

Thanks, Doug, and good morning, everyone. Our operating performance this quarter reflected the deliberate actions we took to protect liquidity, preserve portfolio quality, and position the business for greater efficiency. Unit sales were down 27.1% to 11,411 units and revenue was down 18.2% year over year to $302.8 million. Gross profit margin was 31.2% compared to 36.4% a year ago. That compression is really a volume story. Some of it is mixed. We sold more lower margin wholesale relative to retail. The other piece is that a significant portion of our cost of goods sold tracks to the size of our portfolio, not the vehicles we sold this quarter. For example, service contract and customer repair costs scale with the portfolio, so they do not come down as origination volume falls. Stepping back to the full year, though, the per unit economics actually held up. Full year gross margin was 35.4%, and gross profit per unit rose 1% to $7,442. highlighting that this quarter's compression was about mix and volume, not the quality or economics of the deals we write. History tells us that when money gets tight for our customers, affordable and reliable transportation becomes more essential, not less, and demand for our model tends to grow. In the earliest part of the quarter, applications were up year over year, even on a smaller footprint and less inventory on the ground. Also consider the backdrop we did this against. During the quarter, gas prices rose sharply. The escalation of conflict involving Iran drove pump prices to multi-year highs and put real pressure on exactly the working households we serve. Certainly, when they are spending materially more money at the pump, collections can be impacted. However, better underwriting over the past year has aided in creating more headroom in our customers' monthly budgets, and combined with material operational improvements to how we collect, we delivered remarkable collections results. Full-year collections grew 2.2% to $730 million, and cash collected as a percentage of average finance receivables improved 12 basis points year-over-year. And, notably, we did that on a smaller footprint. Our tax refund season, which falls in the fourth quarter, also held up well. On scheduled tax season dollars, we collected within 1% of the prior fiscal year, essentially flat, even with the added weight of higher pump prices on our customers and having to do that remotely for the dealerships we close during the fiscal year. That is the resilience of the collections platform we have built, and it is our pay-your-way tools doing their job. More customers paying remotely, more customers than ever with auto recurring payments, and ultimately more customers paying consistently. Our loan origination system helped our team stay disciplined on underwriting credit by taking higher down payments and shorter terms from our higher risk applicants, and we kept shifting the mix towards higher quality bookings. The bottom line is that we are booking a better quality customer than we did last year. This builds on the SG&A cost control strategy we laid out and executed over the past year, and here is what it bought us. As Doug mentioned, the stores in our footprint today are made up of our strongest, most productive stores and accomplished exactly what we said we would do, to concentrate our resources in our best markets so that when volume recovers, we can recover into a more efficient and productive footprint. Optimizing the footprint also raised a servicing question about what to do with the book from the stores we've closed. Typically, we have consolidated those counts into a nearby location. but some of the stores we closed this quarter did not have one close enough to take them on. To service those accounts, roughly 8% of our receivables, we stood up a centralized servicing for the first time in the company's history, run remotely from our home office here in Rogers, Arkansas, with no physical location assigned. A move like this would have not been practical for us in the past. We simply did not have the remote tools to service customers well without a physical store. Over the past quarter, we built and implemented them. A company-wide customer self-service account center that now houses pay-your-way platforms, remote contract modifications, and centralized service contract repair management. Repairs are a good example of that build. We created centralized management of service contract repairs so a customer can self-service by starting a claim, and managing it themselves through their account center rather than bringing the vehicle into a store. On our end, we're using AI to assist with the decision-making by automatically reviewing contract coverage, auto-approving straightforward claims and validating the accuracy of invoices, which makes the process faster and more consistent and gets the customer back on the road quickly. Taken together, this gives us another way to reach customers and improve their collection experience where a nearby store isn't a practical fit. It's still early and we'll lean on it as much or as little as the results and our customers call for. Let me close by summing up where we stand today. Our remaining stores have historically higher productivity per rooftop and they are led by long-tenured general managers, impressive Car-Mart leaders who know their customers and their communities. We continue to evolve, building technology and servicing models to meet our customers where they need to be met. And through it all, we are servicing our book, We are taking payments, we are handling repairs, and we are taking care of our customers every single day, regardless of what is happening around us. This is a strong, durable, and evolving business, and we are working through the process to secure the capital to support it. Before I hand it over to Jonathan, I would be remiss if I did not take a moment to say thank you. To our customers, thank you for your business and for the trust you place in us every day. We do not take it for granted, and we are committed to continuing to earn it. To our partners and vendors, thank you as well. So much of what we did this quarter, from servicing our accounts and managing repairs to the transporting and wholesaling of our vehicles, depending on having good partners alongside us, and we counted on you throughout the year. And to our associates, the teams in the field and in the dealerships, our home office and technology teams, and the servicing teams who took on hard new work this year and delivered, thank you. None of this happens without you. You continue to show up and put our customers first, and I could not be prouder of this team. With that, I will turn it back to Jonathan for the financial performance review.