goeasy Ltd.

Good morning, my name is Joanna and I will be your conference operator today. At this time, I would like to welcome everyone to Go Easy Limited fourth quarter 2024 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, please press star, then the number two. Thank you. I will now turn the call over to Mr. Farhan Ali Khan. Please go ahead.

Thank you, operator. Good morning, everyone. My name is Farhan Ali Khan, the company's chief strategy and corporate development officer, and thank you for joining us to discuss GoEasy Limited's results for the fourth quarter ended December 31, 2024. The news release, which was issued yesterday after the close of market, is available on Recision and on the GoEasy website. Today, David Ingram, GOEC's executive chairman and interim chief executive officer, will review the results for the fourth quarter and provide an outlook for the business. Hal Khoury, the company's chief financial officer, will provide an overview of our capital and liquidity position. Jason Appel, the company's chief risk officer, and Patrick Enns, president of Easy Financial and Easy Home, are also on the call. After our prepared remarks, we will then open the lines for questions. Before we begin, I remind you that this conference call is open to all investors and is being webcast through the company's investor website and supplemented by a quarterly earnings presentation. For those dialing in directly by phone, the presentation can also be found directly on our investor site. Analysts are welcome to ask questions over the phone after management has finished their prepared remarks. The operator will poll for questions and provide instructions at the appropriate time. Business media are welcome to listen to this call and to use management's comments and responses to questions in any coverage. However, we ask that they do not quote callers unless that individual has granted their consent. This discussion contains forward-looking statements. I'm not going to read the full statement, but will direct you to the caution regarding forward-looking statements, including the MD&A. I will now turn the call over to David Ingram.

Thanks, Farhan. Good morning, everyone, and thank you for joining the call today. The fourth quarter wrapped up another milestone year for the company. We were proud to have met or exceeded all of the metrics provided in our commercial forecast while producing record growth, consistently stable credit performance, and improved operating leverage, further solidifying our position as a leader in the Canadian non-prime consumer credit market. With over 9.6 million non-prime Canadians, we play an extremely important role in the financial system. In 2024 alone, we issued over 315,000 loans to help everyday Canadians tackle their household financial needs. With originations exceeding $3.2 billion in the year, we have now proudly served approximately 1.5 million Canadians. Furthermore, we remained focused on providing our customers with a path to reduce their cost of borrowing when they have demonstrated consistent payment behavior by offering access to products with progressively lower rates of interest. Over time, we are proud to have reduced the weighted average interest rate we charge our borrowers to approximately 29%, passing on the benefits of our scale directly to the customer. And lastly, we have now helped over 380,000 customers graduate to prime credit so far, and with many of our active customers acquired in the last few years, the number of borrowers that we plan to help improve their finances is only to grow. 2024 was also another milestone year in building our high-performance culture, fueled by dedicated and ambitious people that care deeply about the financial well-being of their customers. During the year, we were recognized as one of Canada's most admired corporate cultures, ranked 38th on the 2024 Best Workplaces in Canada list, named on the 2024 Best Workplaces in Ontario list, and named number on the 2024 Best Workplaces in Financial and Insurance Services list, a true testament to our team and their inspiring passion and leadership. Turning to the results for the fourth quarter, which was the strongest in our history, characterized by strong origination volume and loan book growth, stable credit and record earnings, and a very healthy return on equity. A continued increase in market share and favorable competitive dynamics led to record volume of applications for credit at 677,000, up 28% from quarter four last year, generating 46,800 new customers, an increase of 16%. Loan originations during the quarter were 814 million, up 15% compared to 705 million produced in the fourth quarter of 2023. Organic loan growth for the fourth quarter was a healthy $203 million, while our loan portfolio finished the year at $4.6 billion, up 26%. Unsecured lending continues to be the largest product category at 63% of loan originations, and within our direct-to-consumer channel, the average loan portfolio across our branch network rose to a new high of $7 million, up 22%. We continue to make progress in scaling our automotive financing product with record fourth quarter originations of $139 million, up 31% year over year. This quarter, we grew our dealer network to over 3,900 dealers and continue to experience an increase in funding volume from multi-location dealer groups. During the quarter, home equity lending volumes were also up 31% year over year with consistent and conservative LTV ratios at approximately 64% inclusive of our loan. The second mortgage product secured by residential real estate is primarily used for debt consolidation and major home repairs and is one of our best performing products with the lowest credit risk. The overall weighted average interest rate charged to our customers during the quarter was 29%, down from 30.3% at the end of the fourth quarter last year. Combined with ancillary revenue sources, the total portfolio yield finished within our forecasted range at 33.6%. Total revenue in the quarter was a record $405 million, up 20% over the same period in 2023. We continue to be pleased with the quality of our loan originations and credit performance of the overall portfolio. The dollar-weighted average credit score of our fourth quarter loan originations was 624, the highest in company history for the third consecutive quarter, highlighting the benefits of our credit adjustments and improving product links. The fourth quarter was also the 12th consecutive quarter where the dollar-weighted average credit score of our originations was greater than 600. Secured loans now also represent a record 45.3% of the total portfolio. Despite the weakening economic environment and a modest elevation in delinquency relative to last year, our credit losses have remained stable as a result of proactive credit tightening and the higher proportion of our portfolio secured by hard collateral. We have long maintained that managing the credit performance of the business is our highest priority. The decision to tighten credit criteria and focus on growing higher credit quality loan products has served us all well during periods of economic stress. The annualized net charge-off rate during the fourth quarter was 9.1%, in line with our forecasted range of between 8.75% and 9.75% for the quarter, and a slight quarter-over-quarter improvement from 9.2%. A loan loss provision rate rose to 7.61% from 7.38% in the prior quarter due to unfavorable changes in forward-looking macroeconomic indicators obtained from Moody's Analytics, which the company incorporates into its loan loss provision forecast model. We are continuing to experience the benefits of scale through operational leverage and productivity improvements. During the fourth quarter, our efficiency ratio, specifically operating expenses as a percentage of revenue, improved 24.2%, a reduction of 410 basis points from 28.3% in the fourth quarter of the prior year. After adjusting for unusual items and non-recurring expenses, we reported record adjusted operating income of $168 million, an increase of 20% compared to $141 million in the fourth quarter of 2023. Adjusted operating margin for the fourth quarter was 41.6%, consistent with the same period in 2023. Adjusted net income was a record 77.4 million, up 12% from 69 million in the fourth quarter of 2023, while adjusted diluted earnings per share was a record $4.45, up 11% from $4.01 in the fourth quarter of 2023. An adjusted return on equity was above our target level of a return at 25.9% in the quarter. With that, I'll now pass it over to Hal to discuss our balance sheet and capital position before providing some comments on our outlook.