Propel Holdings Inc.

Good morning, everyone. Welcome to Propel Holdings First Quarter 2022 Financial Results Conference Call. As a reminder, this conference call is being recorded on May 10th, 2022. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question and answer session. Instruction will be provided at that time for research analysts to queue up for questions. I will now turn the call over to Sharika Aluwalia. Please go ahead, Sharika.

Thank you, operator. Good morning, everyone, and thank you for joining us today. Propel's first quarter financial results were released this morning. The press release, financial statements, and MD&A are available on CDAR, as well as the company's website, propelholdings.com. Before we begin, I'd like to remind all participants that our statements and comments today may include forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include but are not necessarily limited to financial projections or other statements of the company's plans, objectives, expectations, or intentions, and management plans for future operations or similar matters which are subject to certain risks and uncertainties. These statements are not guaranteed for future performance and therefore undue reliance should not be placed upon them. The company's actual results could differ materially from those projected or suggested in the forward-looking statements due to several important factors or assumptions, many of which are beyond the company's control, including those risks and uncertainties described in our annual information form for the year end of December 31, 2021, filed on CEDAR. Any forward-looking statements we make today are only as of today's date. Except as required by a possible securities law, we undertake no obligation to publicly update or review any forward-looking statements. Additionally, during the call, we may refer to non-IFRS measures. Participants are advised to review the section entitled Non-IFRS Financial Measures and Industry Metrics in the Company's Management Discussion and Analysis for the quarter ended March 31, 2022, for definitions of our non-IFRS measures and the reconciliation of these measures for the most comparable IFRS measures. I am joined on the call today by Clive Kinross, Founder and Chief Executive Officer, and Sheldon Sadakoski, Founder and Chief Financial Officer. Gary Edelstein, President of Propel, and I will also be available for the question and answer period. I will now pass the call over to Clive.

Thank you, Sorka, and welcome everybody to our Q1 2022 conference call. I will start today's conference call with a quick overview of our operations. I will then cover recent financial performance. Sheldon will provide a detailed analysis of our financial results, and I will end our prepared remarks with some comments on our outlook and strategy. Propel is a consumer-focused fintech lending platform with a track record of significant growth and profitable operations. Our primary objective is to facilitate access to credits for millions of underserved consumers, and to execute on that objective, we have significantly increased our geographic presence across the United States, and we've expanded the credit options available through our platform. Since inception, we have facilitated over 878,000 loans and lines of credit for Propel and our bank partners, which totals over $750 million in total originations funded. Our Q1 2022 results reflected a continuation of our rapid growth trajectory, with ending combined loans and advanced balances increasing 134% over the prior year. and 17% since year-end through March 31, during what is usually a seasonally lower growth quarter. These record portfolio balances were driven by several factors. First, we added one new bank partner in Q2 2021. Second, our bank partners rolled their products out in 10 new states, each under the MoneyKey and CreditFresh brands over the course of 2021, expanding our collective product and service offerings geographically. Third, we have added marketing partners to our platform and expanded existing marketing channels. Fourth, our variable pricing and graduation programs continue to perform very well. And lastly, on a macro level, we have seen a return in consumer demand in the U.S., as well as an accelerated movement from brick and mortar to online. Our portfolio growth resulted in year-over-year revenue growth of 85% in Q1 2022. We have earned $9.7 million in adjusted EBITDA and $5.6 million in adjusted net income in Q1 2022. Our adjusted EBITDA margin was 19% this quarter as compared to 37% in Q1 2021. And our adjusted net income margin was 11% as compared to 21% in Q1 2021. For those of you that are familiar with the seasonality of our business, you know that our profitability margins are typically higher in the first calendar quarter of the year. This is because demand and growth rates soften after a strong holiday season, and our customers typically gain the windfall from tax returns. Q1 2022, however, was an exceptionally strong quarter for originations and portfolio growth. This was due to stronger demand for credit and lower tax refunds among our consumer base, as many people received child tax credits in the second half of 2021, effectively pulling forward their tax refunds. As many of you know, in periods of higher growth, we recognize the cash data and acquisition costs, and we also book significant non-cash expenses related to provisioning on new originations under IFRS. In quarters like Q1, where the growth rate is much higher than the comparable period, we incur both higher cash and non-cash costs on originations with very little attributable revenue. Looking past the accounting dynamics that impact profitability in the short term, Propel has made great strides expanding its total addressable market, and we expect that the growth in our portfolio will lead to growth in revenue and profitability. With that, I will now pass the call over to Sheldon.