GSY Goeasy Ltd

goeasy Ltd. (TSX: GSY), (“goeasy” or the “Company”), one of Canada’s leading non-prime consumer lenders, today reported results for the fourth quarter and full year ended December 31, 2022.

Fourth Quarter Results

During the quarter, the Company produced loan originations of $632 million, up 25% compared to $507 million originated in the fourth quarter of 2021. The increase in lending was driven by strong performance across the Company’s entire range of products and acquisition channels, including unsecured lending, home equity loans, point-of-sale lending, and automotive financing.

The increased loan originations led to growth in the loan portfolio of $206 million, which was up 54% from $134 million of loan growth in the fourth quarter of 2021. At quarter end, the gross consumer loan receivable portfolio was $2.79 billion, up 38% from $2.03 billion in the fourth quarter of 2021. The growth in consumer loans led to an increase in revenue, which was a record $273 million in the quarter, up 17% over the same period last year.

During the quarter, the Company continued to experience stable credit and payment performance. The net charge off rate in the fourth quarter was 9.0%, in line with the Company’s target range of between 8.5% and 10.5% on an annualized basis, and 60 bps lower than 9.6% in the fourth quarter of 2021. The stable credit performance reflects the improved credit quality and product mix of the loan portfolio and the proactive credit and underwriting enhancements made throughout 2021 and 2022. The Company’s allowance for future credit losses also remained stable at 7.62%, compared to 7.58% in the prior quarter.

Operating income for the fourth quarter of 2022 was $75.9 million, down 5% from $79.6 million in the fourth quarter of 2021. Operating margin for the fourth quarter was 27.8%, down from 34.0% in the same period last year.

During the quarter, the Company decided to terminate its agreement with a third-party technology provider that was contracted in 2020 to develop a new loan management system. After careful evaluation, the Company determined that the performance to date was inadequate, and the additional investment necessary to complete development was no longer economical, relative to the anticipated business value and other available options. As such, the Company elected to write off capitalized software costs in 2022 in the amount of $20.5 million, associated with the loan management system being developed by the third-party. The matter is now closed, and the Company does not carry any additional liability. The Company does not anticipate this decision to affect its ability to achieve its long-term organic growth forecast and expects to further reduce its capital expenditures over the course of 2023 and 2024 by approximately $20 million.

After adjusting for items related to the acquisition of LendCare Capital Inc. (“LendCare”) and the previously mentioned non-recurring, non-cash write-off of capitalized software costs, the Company reported record adjusted operating income2 of $99.7 million, up $13.4 million or an increase of 16% compared to $86.4 million in the fourth quarter of 2021. Adjusted operating margin1 for the fourth quarter was 36.5%, slightly down from 36.8% in the same period in 2021, primarily due to a higher level of loan growth resulting in an increase in the loan loss provision expense compared to the prior period. Efficiency ratio1 for the fourth quarter of 2022 was 32.2%, down 200 bps from 34.2% in the fourth quarter of 2021, reflecting improved operating leverage.

Net income in the fourth quarter was $28.6 million, down 43% from $50.0 million in the same period of 2021, which resulted in diluted earnings per share of $1.71, down 41% from the $2.90 reported in the fourth quarter of 2021. After adjusting for non-recurring and unusual items on an after-tax basis, adjusted net income2 was a record $51.0 million, up 7% from $47.6 million in the fourth quarter of 2021. Adjusted diluted earnings per share1 was a record $3.05, up 11% from $2.76 in the fourth quarter of 2021. Return on equity during the quarter was 13.8%, compared to 25.0% in the fourth quarter of 2021. After adjusting for non-recurring and unusual items, adjusted return on equity1 was 24.6% in the quarter, up from 23.9% in the same period of 2021.

“The fourth quarter wrapped up a year of record growth, strong credit performance and improved operating leverage, further solidifying our position as a leader in the non-prime consumer credit market,” said Jason Mullins, goeasy’s President and Chief Executive Officer, “With $206 million of organic growth in the fourth quarter, we finished 2022 with $2.79 billion in consumer loans. Moreover, despite a challenging macro-economic environment, the evolution of our product mix and disciplined approach to managing risk, served to produce strong credit performance, with an annualized net charge off rate of 9.0% in the quarter, down from 9.6% in the prior year. Adjusted diluted earnings per share was $3.05, up 11% over the fourth quarter of 2021, inclusive of an incremental expense of approximately $0.24 cents in diluted earnings per share related to the higher level of provision related to the elevated net loan growth over the prior year. For the full year of 2022, adjusted diluted earnings per share was $11.55, an 11% increase over 2021. I wish to thank the entire goeasy team for another year of tireless effort taking incredible care of our customers and merchant partners,” Mr. Mullins concluded.

Other Key Fourth Quarter Highlights

easyfinancial

• Revenue of $236 million, up 20%
• 39% of the loan portfolio secured, up from 33%
• Record 66% of net loan advances1 in the quarter were issued to new customers, up from 61%
• Record origination volumes in automotive financing and healthcare financing
• Average loan book per branch3 improved to $4.9 million, an increase of 22.5%
• Weighted average interest rate3 on consumer loans of 30.5%, down from 33.3%
• Record operating income of $106 million, up 21%
• Operating margin of 45.1%, up from 44.7%

easyhome

• Revenue of $37.4 million, broadly flat year over year
• Consumer loan portfolio within easyhome stores increased to $88.8 million, up 27%
• Financial revenue2 from consumer lending increased to $10.7 million, up 19% from $9.0 million
• Operating income of $8.7 million, up 3%
• Operating margin of 23.2%, up from 22.0%

Overall

• 86th consecutive quarter of positive net income
• 19th consecutive year of paying dividends and 9th consecutive year of a dividend increase
• Total customers served nearly 1.3 million
• Adjusted return on equity1 of 24.6%, up from 23.9%
• Adjusted return on tangible common equity1 of 35.9%, down from 36.2%
• Fully drawn weighted average cost of borrowing at 5.5%
• Net debt to net capitalization4 of 71% on December 31, 2022, in line with the Company’s target leverage profile

Full Year Results

For the year of 2022, the Company funded $2.38 billion in loan originations, up 49% from $1.59 billion in 2021. The consumer loan receivable portfolio finished at $2.79 billion, up 38% from $2.03 billion as of December 31, 2021.

For the year of 2022, the Company produced record revenues of $1.02 billion, up 23% compared to $827 million in 2021. Operating income for the year was a record $332 million compared to $281 million in 2021, an increase of $51.4 million or 18%. Adjusted operating income2 was a record $369 million for the year of 2022, 17% higher compared to $317 million in the prior year. Efficiency ratio1 for the year of 2022 was 33.6%, down 360 bps from 37.2% in 2021.

Net income in the year was $140 million and diluted earnings per share was $8.42, compared to $245 million or $14.62 per share. After adjusting for non-recurring items, related to the write-off of intangible assets, acquisition of LendCare, corporate development costs and the fair value mark-to-market change in investments, adjusted net income2 for the year of 2022 was a record $192 million and adjusted diluted earnings per share1 was a record $11.55, compared to $175 million or $10.43 per share, increases of 10% and 11%, respectively. Reported return on equity was 17.6%, while adjusted return on equity1 was 24.2%, down from 26.2% in 2021.

Balance Sheet and Liquidity

Total assets were $3.30 billion as of December 31, 2022, an increase of 27% from $2.60 billion as at December 31, 2021, primarily driven by growth in the consumer loan portfolio.

In November 2022, the Company issued 488,750 common shares including 63,750 common shares issued pursuant to the exercise in full by the syndicate of underwriters of the over-allotment option granted by the Company, at a price of $118.50 per common share, for gross aggregate proceeds of $57.9 million. The Company used the net proceeds to support the growth of its consumer loan portfolio and for general corporate purposes.

In December 2022, the Company established a new $200 million revolving securitization warehouse facility, structured and underwritten by Bank of Montreal. The new facility will be securitized by automotive consumer loans originated by goeasy’s wholly owned subsidiaries, easyfinancial Services Inc. and LendCare, and will have an initial term of two years and interest on advances payable at the rate of 1-month Canadian Dollar Offered Rate (“CDOR”) plus 185 bps. Based on the current 1-month CDOR rate of 4.86% as of February 13, 2022, the interest rate would be 6.71%. The Company established an interest rate swap agreement to generate fixed rate payments on the amounts drawn to assist in mitigating the impact of increases in interest rates. The new securitization facility complements the Company’s existing $1.4 billion revolving securitization warehouse facility, which also bears an interest on advances payable at the rate of 1-month CDOR plus 185 bps.

Free cash flow from operations before net growth in gross consumer loans receivable2 in the quarter was $66.0 million, up 11% from $59.5 million in the fourth quarter of 2021. Based on the cash on hand at the end of the quarter and the borrowing capacity under the Company’s existing revolving credit facilities, the Company had approximately $973 million in total debt capacity as at December 31, 2022. The Company remains confident that the capacity available under its existing funding facilities, and its ability to raise additional debt financing, is sufficient to fund its organic growth forecast.

At quarter-end, the Company’s fully drawn weighted average cost of borrowing was at 5.5%. The Company estimates that it could currently grow the consumer loan portfolio by approximately $250 million per year solely from internal cash flows, without utilizing external debt. The Company also estimates that once its existing and available sources of debt are fully utilized, it could continue to grow the loan portfolio by approximately $400 million per year solely from internal cash flows. The Company also estimates that if it were to run-off its consumer loan and leasing portfolios, the value of the total cash repayments paid to the Company over the remaining life of its contracts would be approximately $3.7 billion. If, during such a run-off scenario with reasonable cost reductions, all excess cash flows were applied directly to debt, the Company estimates it would extinguish all external debt within 15 months.

Future Outlook

The Company has provided a new 3-year forecast for the years 2023 through 2025. The periods of 2023 and 2024 have been updated to reflect the most recent outlook. The Company continues to pursue a long-term strategy that includes expanding its product range, developing its channels of distribution and leveraging risk-based pricing to reduce the cost of borrowing for its consumers and extend the life of its customer relationships. As such, the total yield earned on its consumer loan portfolio will gradually decline, while net charge off rates remain stable and operating margins expand. The forecasts outlined below contemplate the Company’s expected domestic organic growth plan and do not include the impact of any future mergers or acquisitions, or the associated gains or losses associated with its investments.

	Forecasts for 2023	Forecasts for 2024	Forecasts for 2025
Gross consumer loans receivable at year end	$3.4B - $3.6B	$4.1B - $4.3B	$4.7B - $5.0B
Total Company revenue	$1.15B - $1.25B	$1.38B - $1.48B	$1.56B - $1.70B
Total yield on consumer loans (including ancillary      products)1	34.5% - 36.5%	33.5% - 35.5%	33.0% - 35.0%
Net charge offs as a percentage of average gross consumer loans receivable	8.5% - 10.5%	8.0% - 10.0%	8.0% - 10.0%
Total Company operating margin	36%+	37%+	38%+
Return on equity	22%+	22%+	22%+

“We are confident in the strength and resilience of our business model and remain well prepared to navigate the uncertain environment ahead. With favourable market conditions, we now expect to scale the consumer loan portfolio to nearly $5 billion in 2025, as we continue serving the 8.5 million non-prime Canadians that rely on access to credit for everyday financial needs,” Mr. Mullins continued, “In addition to executing our growth plan, we are focused on diligently managing our capital, to produce expanding operating margins and deliver attractive returns on equity for shareholders. With only a small share of the nearly $200 billion non-prime credit market, we are truly just getting started.”   Dividend

Based on its 2022 adjusted earnings and the Company’s confidence in its continued growth and access to capital going forward, the Board of Directors has approved an increase to the annual dividend from $3.64 per share to $3.84 per share, an increase of 5.5%. This year marks the 9th consecutive year of an increase in the dividend to shareholders. As such, the Board of Directors has approved a quarterly dividend of $0.96 per share payable on April 14, 2023 to the holders of common shares of record as at the close of business on March 31, 2023.

Forward-Looking Statements

All figures reported above with respect to outlook are targets established by the Company and are subject to change as plans and business conditions vary. Accordingly, investors are cautioned not to place undue reliance on the foregoing guidance. Actual results may differ materially.

This press release includes forward-looking statements about goeasy, including, but not limited to, its business operations, strategy and expected financial performance and condition. Forward-looking statements include, but are not limited to, statements with respect to forecasts for growth of the consumer loans receivable, annual revenue growth forecasts, strategic initiatives, new product offerings and new delivery channels, anticipated cost savings, planned capital expenditures, anticipated capital requirements and the Company’s ability to secure sufficient capital, liquidity of the Company, plans and references to future operations and results, critical accounting estimates, expected future yields and net charge off rates on loans, the estimated number of new locations to be opened, the dealer relationships, the size and characteristics of the Canadian non-prime lending market and the continued development of the type and size of competitors in the market. In certain cases, forward-looking statements that are predictive in nature, depend upon or refer to future events or conditions, and/or can be identified by the use of words such as “expect”, “continue”, “anticipate”, “intend”, “aim”, “plan”, “believe”, “budget”, “estimate”, “forecast”, “foresee”, “target” or negative versions thereof and similar expressions, and/or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved.

Forward-looking statements are based on certain factors and assumptions, including expected growth, results of operations and business prospects and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company’s operations, economic factors and the industry generally. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events could differ materially from those expressed or implied by forward-looking statements made by the Company. Some important factors that could cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to, goeasy’s ability to enter into new lease and/or financing agreements, collect on existing lease and/or financing agreements, open new locations on favourable terms, offer products which appeal to customers at a competitive rate, respond to changes in legislation, react to uncertainties related to regulatory action, raise capital under favourable terms, compete, manage the impact of litigation (including shareholder litigation), control costs at all levels of the organization and maintain and enhance the system of internal controls.

The Company cautions that the foregoing list is not exhaustive. These and other factors could cause actual results to differ materially from our expectations expressed in the forward-looking statements, and further details and descriptions of these and other factors are disclosed in the Company’s Management’s Discussion and Analysis (“MD&A”), including under the section entitled “Risk Factors”.

The reader is cautioned to consider these, and other factors carefully and not to place undue reliance on forward-looking statements, which may not be appropriate for other purposes. The Company is under no obligation (and expressly disclaims any such obligation) to update or alter the forward-looking statements whether as a result of new information, future events or otherwise, unless required by law.

About goeasy

goeasy Ltd. is a Canadian company, headquartered in Mississauga, Ontario, that provides non-prime leasing and lending services through its easyhome, easyfinancial and LendCare brands. Supported by more than 2,400 employees, the Company offers a wide variety of financial products and services including unsecured and secured instalment loans, merchant financing through a variety of verticals and lease-to-own merchandise. Customers can transact seamlessly through an omnichannel model that includes online and mobile platforms, over 400 locations across Canada, and point-of-sale financing offered in the retail, powersports, automotive, home improvement and healthcare verticals, through approximately 6,500 merchant partners across Canada. Throughout the Company’s history, it has acquired and organically served approximately 1.3 million Canadians and originated approximately $10.1 billion in loans.

Accredited by the Better Business Bureau, goeasy is the proud recipient of several awards in recognition of its exceptional culture and continued business growth including Waterstone Canada’s Most Admired Corporate Cultures, ranking on the 2022 Report on Business Women Lead Here executive gender diversity benchmark, placing on the Report on Business ranking of Canada’s Top Growing Companies, ranking on the TSX30, Greater Toronto Top Employers Award and has been certified as a Great Place to Work®. The Company is represented by a diverse group of team members from 78 nationalities who believe strongly in giving back to communities in which it operates. To date, goeasy has raised and donated over $4.8 million to support its long-standing partnerships with BGC Canada, Habitat for Humanity and many other local charities.

goeasy Ltd.’s. common shares are listed on the TSX under the trading symbol “GSY”. goeasy is rated BB- with a stable trend from S&P and Ba3 with a stable trend from Moody’s. Visit www.goeasy.com.

For further information contact:

Jason MullinsPresident & Chief Executive Officer(905) 272-2788

Farhan Ali KhanSenior Vice President, Chief Corporate Development Officer(905) 272-2788

Notes:These are non-IFRS ratios. Refer to “Non-IFRS Measures and Other Financial Measures” section in this press release.2 These are non-IFRS measures. Refer to “Non-IFRS Measures and Other Financial Measures” section in this press release.3 These are supplementary financial measures. Refer to “Non-IFRS Measures and Other Financial Measures” section in this press release.4 These are capital management measures. Refer to “Non-IFRS Measures and Other Financial Measures” section in this press release.5 Non-IFRS ratios, non-IFRS measures, supplementary financial measures and capital management measures are not determined in accordance with IFRS, do not have standardized meanings and may not be comparable to similar financial measures presented by other companies.

goeasy Ltd.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Expressed in thousands of Canadian dollars)
			As At	As At
			December 31,	December 31,
			2022	2021
ASSETS
Cash			62,654	102,479
Accounts receivable			25,697	20,769
Prepaid expenses			8,334	8,018
Income taxes recoverable			2,323	-
Consumer loans receivable, net			2,627,357	1,899,631
Investments			57,304	64,441
Lease assets			48,437	47,182
Property and equipment, net			35,856	35,285
Derivative financial assets			49,444	20,634
Intangible assets, net			138,802	159,651
Right-of-use assets, net			65,758	57,140
Goodwill			180,923	180,923
TOTAL ASSETS			3,302,889	2,596,153
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Revolving credit facility			148,646	-
Accounts payable and accrued liabilities			51,136	57,134
Income taxes payable			-	27,859
Dividends payable			14,965	10,692
Unearned revenue			28,661	11,354
Accrued interest			10,159	8,135
Deferred tax liabilities, net			24,692	38,648
Lease liabilities			74,328	65,607
Secured borrowings			105,792	173,959
Revolving securitization warehouse facilities			805,825	292,814
Derivative financial liabilities			-	34,132
Notes payable			1,168,997	1,085,906
TOTAL LIABILITIES			2,433,201	1,806,240
Shareholders' equity
Share capital			419,046	363,514
Contributed surplus			21,499	22,583
Accumulated other comprehensive income			2,776	8,567
Retained earnings			426,367	395,249
TOTAL SHAREHOLDERS' EQUITY			869,688	789,913
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY			3,302,889	2,596,153

goeasy Ltd.
CONSOLIDATED STATEMENTS OF INCOME
(Expressed in thousands of Canadian dollars, except earnings per share)
	Three Months Ended				Year Ended
	December 31,		December 31,		December 31,		December 31,
	2022		2021		2022		2021
REVENUE
Interest income	191,320		155,529		698,150		535,638
Lease revenue	25,219		27,663		103,414		112,371
Commissions earned	51,389		45,910		197,159		163,734
Charges and fees	5,398		5,328		20,613		14,979
	273,326		234,430		1,019,336		826,722
OPERATING EXPENSES
BAD DEBTS	78,257		58,640		272,893		182,084
OTHER OPERATING EXPENSES
Salaries and benefits	43,526		36,171		174,236		157,157
Stock-based compensation	2,621		2,772		10,053		8,875
Advertising and promotion	7,942		9,578		34,069		30,393
Occupancy	6,406		6,342		25,234		23,614
Technology costs	7,489		5,312		23,463		18,033
Loss on sale or write off of assets	20,549		2,580		20,549		2,580
Underwriting and collections	3,604		2,980		13,930		9,596
Other expenses	7,806		8,761		31,196		34,501
	99,943		74,496		332,730		284,749
DEPRECIATION AND AMORTIZATION
Depreciation of lease assets	8,516		9,157		33,547		35,844
Depreciation of right-of-use assets	5,249		4,791		20,160		18,207
Amortization of intangible assets	3,029		5,546		18,406		16,831
Depreciation of property and equipment	2,451		2,171		9,193		8,004
	19,245		21,665		81,306		78,886
TOTAL OPERATING EXPENSES	197,445		154,801		686,929		545,719
OPERATING INCOME	75,881		79,629		332,407		281,003
OTHER INCOME (LOSS)	(5,609)		8,371		(28,659)		114,876
FINANCE COSTS	(31,551)		(22,281)		(107,972)		(79,025)
INCOME BEFORE INCOME TAXES	38,721		65,719		195,776		316,854
INCOME TAX EXPENSE (RECOVERY)
Current	11,216		15,167		65,659		73,744
Deferred	(1,071)		591		(10,044)		(1,833)
	10,145		15,758		55,615		71,911
NET INCOME	28,576		49,961		140,161		244,943
BASIC EARNINGS PER SHARE	1.74		3.00		8.61		15.12
DILUTED EARNINGS PER SHARE	1.71		2.90		8.42		14.62

SEGMENT REPORTING
(Expressed in thousands of Canadian dollars, except earnings per share)
	Three Months Ended December 31, 2022
	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	183,345	7,975	-		191,320
Lease revenue	-	25,219	-		25,219
Commissions earned	48,023	3,366	-		51,389
Charges and fees	4,518	880	-		5,398
	235,886	37,440	-		273,326
Operating expenses
Bad debts	75,224	3,033	-		78,257
Other operating expenses	47,539	14,948	37,456		99,943
Depreciation and amortization	6,846	10,772	1,627		19,245
	129,609	28,753	39,083		197,445
Operating income (loss)	106,277	8,687	(39,083)		75,881
Other loss					(5,609)
Finance costs					(31,551)
Income before income taxes					38,721
Income taxes					10,145
Net income					28,576
Diluted earnings per share					1.71
	Three Months Ended December 31, 2021
	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	149,004	6,525	-		155,529
Lease revenue	-	27,663	-		27,663
Commissions earned	42,676	3,234	-		45,910
Charges and fees	4,335	993	-		5,328
	196,015	38,415	-		234,430
Operating expenses
Bad debts	56,058	2,582	-		58,640
Other operating expenses	43,539	15,981	14,976		74,496
Depreciation and amortization	8,775	11,402	1,488		21,665
	108,372	29,965	16,464		154,801
Operating income (loss)	87,643	8,450	(16,464	)	79,629
Other income					8,371
Finance costs					(22,281	)
Income before income taxes					65,719
Income taxes					15,758
Net income					49,961
Diluted earnings per share					2.90
	Year Ended December 31, 2022
	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	668,779	29,371	-		698,150
Lease revenue	-	103,414	-		103,414
Commissions earned	184,013	13,146	-		197,159
Charges and fees	16,736	3,877	-		20,613
	869,528	149,808	-		1,019,336
Operating expenses
Bad debts	261,997	10,896	-		272,893
Other operating expenses	180,867	61,748	90,115		332,730
Depreciation and amortization	32,668	42,586	6,052		81,306
	475,532	115,230	96,167		686,929
Operating income (loss)	393,996	34,578	(96,167)		332,407
Other loss					(28,659)
Finance costs					(107,972)
Income before income taxes					195,776
Income taxes					55,615
Net income					140,161
Diluted earnings per share					8.42
	Year Ended December 31, 2021
($in 000's except earnings per share)	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	512,810	22,828	-		535,638
Lease revenue	-	112,371	-		112,371
Commissions earned	152,485	11,249	-		163,734
Charges and fees	11,056	3,923	-		14,979
	676,351	150,371	-		826,722
Operating expenses
Bad debts	174,936	7,148	-		182,084
Other operating expenses	148,445	61,558	74,746		284,749
Depreciation and amortization	28,219	44,804	5,863		78,886
	351,600	113,510	80,609		545,719
Operating income (loss)	324,751	36,861	(80,609)		281,003
Other income					114,876
Finance costs					(79,025)
Income before income taxes					316,854
Income taxes					71,911
Net income					244,943
Diluted earnings per share					14.62

SUMMARY OF FINANCIAL RESULTS AND KEY PERFORMANCE INDICATORS
(Expressed in thousands of Canadian dollars, except earnings per share and percentages)
	Three Months Ended
	December 31,		December 31,		Variance		Variance
	2022		2021		$ / bps		% change
Summary Financial Results
Revenue	273,326		234,430		38,896		16.6%
Bad debts	78,257		58,640		19,617		33.5%
Other operating expenses	99,943		74,496		25,447		34.2%
EBITDA1	81,001		100,508		(19,507)		(19.4%)
EBITDA margin1	29.6%		42.9%		(1,330 bps)		(31.0%)
Depreciation and amortization	19,245		21,665		(2,420)		(11.2%)
Operating income	75,881		79,629		(3,748)		(4.7 %)
Operating margin	27.8%		34.0%		(620 bps)		(18.2%)
Other (loss) income	(5,609)		8,371		(13,980)		(167.0%)
Finance costs	31,551		22,281		9,270		41.6%
Effective income tax rate	26.2%		24.0%		220 bps		9.2%
Net income	28,576		49,961		(21,385)		(42.8%)
Diluted earnings per share	1.71		2.90		(1.19)		(41.0%)
Return on assets	3.6%		7.9%		(430 bps)		(54.4%)
Return on equity	13.8%		25.0%		(1,120 bps)		(44.8%)
Return on tangible common equity1	21.8%		39.8%		(1,800 bps)		(45.2%)
Adjusted Financial Results1
Other operating expenses	87,877		80,206		7,671		9.6%
Efficiency ratio	32.2%		34.2%		(200 bps)		(5.8%)
Operating income	99,738		86,353		13,385		15.5%
Operating margin	36.5%		36.8%		(30 bps)		(0.8%)
Net income	51,026		47,644		3,382		7.1%
Diluted earnings per share	3.05		2.76		0.29		10.5%
Return on assets	6.3%		7.5%		(120 bps)		(16.0%)
Return on equity	24.6%		23.9%		70 bps		2.9%
Return on tangible common equity	35.9%		36.2%		(30 bps)		(0.8%)
Key Performance Indicators
Segment Financials
easyfinancial revenue	235,886		196,015		39,871		20.3%
easyfinancial operating margin	45.1%		44.7%		40 bps		0.9%
easyhome revenue	37,440		38,415		(975)		(2.5%)
easyhome operating margin	23.2%		22.0%		120 bps		5.5%
Portfolio Indicators
Gross consumer loans receivable	2,794,694		2,030,339		764,355		37.6%
Growth in consumer loans receivable	206,038		133,623		72,415		54.2%
Gross loan originations	632,355		506,853		125,502		24.8%
Total yield on consumer loans (including ancillary products)1	36.2%		41.4%		(520 bps)		(12.6%)
Net charge offs as a percentage of average gross consumer loans receivable	9.0%		9.6%		(60 bps)		(6.3%)
Free cash flows from operations before net growth in gross consumer loans receivable1	66,040		59,452		6,588		11.1%
Potential monthly lease revenue1	7,868		8,193		(325)		(4.0%)
1 EBITDA, adjusted other operating expenses, adjusted operating income, adjusted net income and free cash flows from operations before net growth in gross consumer loans receivable are non-IFRS measures. EBITDA margin, efficiency ratio, adjusted operating margin, adjusted diluted earnings per share, adjusted return on equity, adjusted return on assets, reported and adjusted return on tangible common equity and total yield on consumer loans (including ancillary products) are non-IFRS ratios. Refer to “Non-IFRS Measures and Other Financial Measures” section in this press release.
	Year Ended
	December 31,		December 31,		Variance		Variance
	2022		2021		$ / bps		% change
Summary Financial Results
Revenue	1,019,336		826,722		192,614		23.3%
Bad debts	272,893		182,084		90,809		49.9%
Other operating expenses	332,730		284,749		47,981		16.9%
EBITDA1	351,507		438,921		(87,414)		(19.9 %)
EBITDA margin1	34.5%		53.1%		(1,860 bps)		(35.0%)
Depreciation and amortization	81,306		78,886		2,420		3.1%
Operating income	332,407		281,003		51,404		18.3%
Operating margin	32.6%		34.0%		(140 bps)		(4.1 %)
Other (loss) income	(28,659)		114,876		(143,535	)	(124.9 %)
Finance costs	107,972		79,025		28,947		36.6%
Effective income tax rate	28.4%		22.7%		570 bps		25.1%
Net income	140,161		244,943		(104,782)		(42.8 %)
Diluted earnings per share	8.42		14.62		(6.20)		(42.4 %)
Return on assets	4.8%		11.5%		(670 bps)		(58.3 %)
Return on equity	17.6%		36.7%		(1,910 bps)		(52.0%)
Return on tangible common equity1	28.4%		50.7%		(2,230 bps)		(44.0%)
Adjusted Financial Results1
Other operating expenses	342,422		307,931		34,491		11.2%
Efficiency ratio	33.6%		37.2%		(360 bps)		(9.7%)
Operating income	369,362		316,652		52,710		16.6%
Operating margin	36.2%		38.3%		(210 bps)		(5.5 %)
Net income	192,261		174,759		17,502		10.0%
Diluted earnings per share	11.55		10.43		1.12		10.7%
Return on assets	6.6%		8.2%		(160 bps)		(19.5 %)
Return on equity	24.2%		26.2%		(200 bps)		(7.6%)
Return on tangible common equity	36.4%		35.3%		110 bps		3.1%
Key Performance Indicators
Segment Financials
easyfinancial revenue	869,528		676,351		193,177		28.6%
easyfinancial operating margin	45.3%		48.0%		(270 bps)		(5.6%)
easyhome revenue	149,808		150,371		(563)		(0.4 %)
easyhome operating margin	23.1%		24.5%		(140 bps)		(5.7%)
Portfolio Indicators
Gross consumer loans receivable	2,794,694		2,030,339		764,355		37.6%
Growth in consumer loans receivable2	764,355		783,499		(19,144)		(2.4%)
Gross loan originations	2,377,606		1,594,480		783,126		49.1%
Total yield on consumer loans (including ancillary products)1	37.7%		42.1%		(440 bps)		(10.5%)
Net charge offs as a percentage of average gross consumer loans receivable	9.1%		8.8%		30 bps		3.4%
Free cash flows from operations before net growth in gross consumer loans receivable1	258,474		260,104		(1,630)		(0.6%)
Potential monthly lease revenue1	7,868		8,193		(325)		(4.0%)
1 EBITDA, adjusted other operating expenses, adjusted operating income, adjusted net income and free cash flows from operations before net growth in gross consumer loans receivable are non-IFRS measures. EBITDA margin, efficiency ratio, adjusted operating margin, adjusted diluted earnings per share, adjusted return on equity, adjusted return on assets, reported and adjusted return on tangible common equity and total yield on consumer loans (including ancillary products) are non-IFRS ratios. Refer to “Non-IFRS Measures and Other Financial Measures” section in this press release. 2 Growth in consumer loans receivable for the year ended December 31, 2021 includes $444.5 million of gross loans purchased through the acquisition of LendCare.

Non-IFRS Measures and Other Financial Measures

The Company uses a number of financial measures to assess its performance. Some of these measures are not calculated in accordance with International Financial Reporting Standards (IFRS) as issued by International Accounting Standards Board (IASB), are not identified by IFRS and do not have standardized meanings that would ensure consistency and comparability among companies using these measures. The Company believes that non-IFRS measures are useful in assessing ongoing business performance and provide readers with a better understanding of how management assesses performance. These non-IFRS measures are used throughout this press release and listed below. An explanation of the composition of non-IFRS measures and other financial measures can be found in the Company’s MD&A, available on www.sedar.com.

Adjusted Net Income and Adjusted Diluted Earnings Per Share

Adjusted net income is a non-IFRS measure, while adjusted diluted earnings per share is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate adjusted net income and adjusted earnings per share for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Year Ended
($in 000’s except earnings per share)	December 31,2022		December 31,2021		December 31,2022		December 31,2021
Net income as stated	28,576		49,961		140,161		244,943
Impact of adjusting items
Bad debts
Day one loan loss provision on the acquired loans1	-		-		-		14,252
Other operating expenses
Write off of an intangible asset5	20,460		-		20,460		-
Corporate development costs6	-		-		2,314		-
Integration costs3	122		3,447		1,081		5,047
Transaction costs2	-		-		-		7,615
Depreciation and amortization
Amortization of acquired intangible assets4	3,275		3,277		13,100		8,735
Other loss (income)7	5,609		(8,371	)	28,659		(114,876	)
Finance costs
Transaction costs2	-		-		-		1,726
Total pre-tax impact of adjusting items	29,466		(1,647	)	65,614		(77,501	)
Income tax impact of above adjusting items	(7,016	)	(670	)	(13,514	)	7,317
After-tax impact of adjusting items	22,450		(2,317	)	52,100		(70,184	)
Adjusted net income	51,026		47,644		192,261		174,759
Weighted average number of diluted shares outstanding	16,753		17,233		16,650		16,757
Diluted earnings per share as stated	1.71		2.90		8.42		14.62
Per share impact of adjusting items	1.34		(0.14	)	3.13		(4.19	)
Adjusted diluted earnings per share	3.05		2.76		11.55		10.43

 

Adjusting items related to the LendCare Acquisition1 Bad debt expense related to the day one loan loss provision on the acquired loan portfolio from LendCare.2 Transaction costs included advisory and consulting costs, legal costs, and other direct transaction costs related to the acquisition of LendCare reported under Other operating expenses and loan commitment fees related to the acquisition of LendCare reported under Finance costs.3 Integration costs related to advisory and consulting costs, employee incentives, representation and warranty insurance costs, other integration costs related to the acquisition of LendCare and the write off of certain software as a result of the integration with LendCare. Integration costs were reported under Other operating expenses.4 Amortization of the $131 million intangible asset related to the acquisition of LendCare with an estimated useful life of ten years.Adjusting item related to the write off of intangible assets5 During the fourth quarter of 2022, the Company decided to terminate its agreement with a third-party technology provider that was contracted in 2020 to develop a new loan management system. After careful evaluation, the Company determined that the performance to date was unsatisfactory, and the additional investment necessary to complete the development was no longer economical, relative to the anticipated business value and other available options. As such, the Company elected to write off the capitalized software costs in 2022 in the amount of $20.5 million associated with this new loan management system developed by the third-party.Adjusting item related to corporate development costs6 Corporate development costs are related to the exploration of a strategic acquisition opportunity, which the Company elected to not pursue, including advisory, consulting and legal costs reported under Other operating expenses.Adjusting item related to other income (loss)7 For the three-month periods and years ended December 31, 2022 and 2021, investment income (loss) is mainly due to fair value gains (losses) on investments in Affirm and its related TRS.

Adjusted Other Operating Expenses and Efficiency Ratio

Adjusted other operating expenses is a non-IFRS measure, while efficiency ratio is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate adjusted other operating expenses and efficiency ratio for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Year Ended
($in 000’s except earnings per share)	December 31,2022		December 31,2021		December 31,2022		December 31,2021
Other operating expenses as stated	99,943		74,496		332,730		284,749
Impact of adjusting items
Other operating expenses1
Write off of intangible assets	(20,460	)	-		(20,460	)	-
Corporate development costs	-		-		(2,314	)	-
Integration costs	(122	)	(3,447	)	(1,081	)	(5,047	)
Transaction costs	-		-		-		(7,615	)
Depreciation and amortization
Depreciation of lease assets	8,516		9,157		33,547		35,844
Total impact of adjusting items	(12,066	)	5,710		9,692		23,182
Adjusted other operating expenses	87,877		80,206		342,422		307,931
Total revenue	273,326		234,430		1,019,336		826,722
Efficiency ratio	32.2%		34.2%		33.6%		37.2%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

Adjusted Operating Income and Adjusted Operating Margin

Adjusted operating income is a non-IFRS measure, while adjusted operating margin is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate adjusted operating income and adjusted operating margins for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	December 31,2022		December 31,2022(adjusted)		December 31,2021		December 31,2021(adjusted)
easyfinancial
Operating income	106,277		106,277		87,643		87,643
Divided by revenue	235,886		235,886		196,015		196,015
easyfinancial operating margin	45.1%		45.1%		44.7%		44.7%
easyhome
Operating income	8,687		8,687		8,450		8,450
Divided by revenue	37,440		37,440		38,415		38,415
easyhome operating margin	23.2%		23.2%		22.0%		22.0%
Total
Operating income	75,881		75,881		79,629		79,629
Other operating expenses1
Write off of an intangible asset	-		20,460		-		-
Integration costs	-		122		-		3,447
Depreciation and amortization1
Amortization of acquired intangible assets	-		3,275		-		3,277
Adjusted operating income	75,881		99,738		79,629		86,353
Divided by revenue	273,326		273,326		234,430		234,430
Total operating margin	27.8%		36.5%		34.0%		36.8%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

	Year Ended
($in 000’s except percentages)	December 31,2022		December 31,2022 (adjusted)		December 31,2021		December 31,2021 (adjusted)
easyfinancial
Operating income	393,996		393,996		324,751		324,751
Divided by revenue	869,528		869,528		676,351		676,351
easyfinancial operating margin	45.3%		45.3%		48.0%		48.0%
easyhome
Operating income	34,578		34,578		36,861		36,861
Divided by revenue	149,808		149,808		150,371		150,371
easyhome operating margin	23.1%		23.1%		24.5%		24.5%
Total
Operating income	332,407		332,407		281,003		281,003
Bad debts1
Day one loan loss provision on the acquired loans	-		-		-		14,252
Other operating expenses1
Write off of intangible assets	-		20,460		-		-
Corporate development costs	-		2,314		-		-
Integration costs	-		1,081		-		5,047
Transaction costs	-		-		-		7,615
Amortization of intangible assets1
Amortization of acquired intangible assets	-		13,100		-		8,735
Adjusted operating income	332,407		369,362		281,003		316,652
Divided by revenue	1,019,336		1,019,336		826,722		826,722
Total operating margin	32.6%		36.2%		34.0%		38.3%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

Earnings before Interest, Taxes, Depreciation and Amortization (“EBITDA”) and EBITDA Margin

EBITDA is a non-IFRS measure, while EBITDA margin is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate EBITDA and EBITDA margin for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Year Ended
($in 000’s except percentages)	December 31,2022		December 31,2021		December 31,2022		December 31,2021
Net income as stated	28,576		49,961		140,161		244,943
Finance costs	31,551		22,281		107,972		79,025
Income tax expense	10,145		15,758		55,615		71,911
Depreciation and amortization	19,245		21,665		81,306		78,886
Depreciation of lease assets	(8,516	)	(9,157	)	(33,547	)	(35,844	)
EBITDA	81,001		100,508		351,507		438,921
Divided by revenue	273,326		234,430		1,019,336		826,722
EBITDA margin	29.6%		42.9%		34.5%		53.1%

Free Cash Flow from Operations before Net Growth in Gross Consumer Loans Receivable

Free cash flow from operations before net growth in gross consumer loans receivable is a non-IFRS measure. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate free cash flow from operations before net growth in gross consumer loans receivable for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Year Ended
	December 31,2022		December 31,2021		December 31,2022		December 31,2021
Cash used in operating activities	(139,998	)	(74,171	)	(505,881	)	(78,875	)
Net growth in gross consumer loans receivable during the period	206,038		133,623		764,355		783,499
Less: Gross loans purchased1	-		-		-		(444,520	)
	206,038		133,623		764,355		338,979
Free cash flows from operations before net growth in gross consumer loans receivable	66,040		59,452		258,474		260,104

1 Gross loans purchased during the second quarter of 2021 through the acquisition of LendCare.

Adjusted Return on Assets

Adjusted return on assets is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate adjusted return on assets for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	December 31,2022		December 31,2022(adjusted)		December 31,2021		December 31,2021 (adjusted)
Net income as stated	28,576		28,576		49,961		49,961
After-tax impact of adjusting items1	-		22,450		-		(2,317	)
Adjusted net income	28,576		51,026		49,961		47,644
Multiplied by number of periods in a year	X 4		X 4		X 4		X 4
Divided by average total assets for the period	3,216,403		3,216,403		2,533,945		2,533,945
Return on assets	3.6%		6.3%		7.9%		7.5%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

	Year Ended
($in 000’s except percentages)	December 31,2022		December 31,2022 (adjusted)		December 31,2021		December 31,2021 (adjusted)
Net income as stated	140,161		140,161		244,943		244,943
After-tax impact of adjusting items1	-		52,100		-		(70,184	)
Adjusted net income	140,161		192,261		244,943		174,759
Divided by average total assets for the period	2,922,605		2,922,605		2,126,594		2,126,594
Return on assets	4.8%		6.6%		11.5%		8.2%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

Adjusted Return on Equity

Adjusted return on equity is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate adjusted return on equity for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	December 31,2022		December 31,2022 (adjusted)		December 31,2021		December 31,2021 (adjusted)
Net income as stated	28,576		28,576		49,961		49,961
After-tax impact of adjusting items1	-		22,450		-		(2,371	)
Adjusted net income	28,576		51,026		49,961		47,644
Multiplied by number of periods in a year	X 4		X 4		X 4		X 4
Divided by average shareholders’ equity for the period	830,820		830,820		798,620		798,620
Return on equity	13.8%		24.6%		25.0%		23.9%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

	Year Ended
($in 000’s except percentages)	December 31,2022		December 31,2022 (adjusted)		December 31,2021		December 31,2021 (adjusted)
Net income as stated	140,161		140,161		244,943		244,943
After-tax impact of adjusting items1	-		52,100		-		(70,184	)
Adjusted net income	140,161		192,261		244,943		174,759
Divided by average shareholders’ equity for the period	794,269		794,269		667,962		667,962
Return on equity	17.6%		24.2%		36.7%		26.2%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.

Return on Tangible Common Equity

Reported and adjusted return on tangible common equity are non-IFRS ratios. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 43 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate reported and adjusted return on tangible common equity for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	December 31,2022		December 31,2022 (adjusted)		December 31,2021		December 31,2021 (adjusted)
Net income as stated	28,576		28,576		49,961		49,961
Amortization of acquired intangible assets	3,275		3,275		3,277		3,277
Income tax impact of the above item	(868	)	(868	)	(868	)	(868	)
Net income before amortization of acquired intangible assets, net of income tax	30,983		30,983		52,370		52,370
Impact of adjusting items1
Other operating expenses
Write off of an intangible asset	-		20,460		-		-
Integration costs	-		122		-		3,447
Other loss (income)	-		5,609		-		(8,371	)
Total pre-tax impact of adjusting items	-		26,191		-		(4,924	)
Income tax impact of above adjusting items	-		(6,148	)	-		198
After-tax impact of adjusting items	-		20,043		-		(4,726	)
Adjusted net income	30,983		51,026		52,370		47,644
Multiplied by number of periods in a year	X 4		X 4		X 4		X 4
Average shareholders’ equity	830,820		830,820		798,620		798,620
Average goodwill	(180,923	)	(180,923	)	(180,923	)	(180,923	)
Average acquired intangible assets2	(110,804	)	(110,804	)	(123,904	)	(123,904	)
Average related deferred tax liabilities	29,363		29,363		32,835		32,835
Divided by average tangible common equity	568,456		568,456		526,628		526,628
Return on tangible common equity	21.8%		35.9%		39.8%		36.2%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.2 Excludes intangible assets relating to software.

	Year Ended
($in 000’s except percentages)	December 31,2022		December 31,2022 (adjusted)		December 31,2021		December 31,2021 (adjusted)
Net income as stated	140,161		140,161		244,943		244,943
Amortization of acquired intangible assets	13,100		13,100		8,735		8,735
Income tax impact of the above item	(3,471	)	(3,471	)	(2,314	)	(2,314	)
Net income before amortization of acquired intangible assets, net of income tax	149,790		149,790		251,364		251,364
Impact of adjusting items1
Bad debts
Day one loan loss provision on the acquired loans	-		-		-		14,252
Other operating expenses
Write -off of an intangible asset	-		20,460		-		-
Corporate development costs	-		2,314		-		-
Integration costs	-		1,081		-		5,047
Transaction costs	-		-		-		7,615
Other loss (income)	-		28,659		-		(114,876	)
Finance costs
Transaction costs	-		-		-		1,726
Total pre-tax impact of adjusting items	-		52,514		-		(86,236	)
Income tax impact of above adjusting items	-		(10,043	)	-		9,631
After-tax impact of adjusting items	-		42,471		-		(76,605	)
Adjusted net income	149,790		192,261		251,364		174,759
Average shareholders’ equity	794,269		794,269		667,962		667,962
Average goodwill	(180,923	)	(180,923	)	(116,860	)	(116,860	)
Average acquired intangible assets2	(115,717	)	(115,717	)	(75,325	)	(75,325	)
Average related deferred tax liabilities	30,665		30,665		19,961		19,961
Divided by average tangible common equity	528,294		528,294		495,738		495,738
Return on tangible common equity	28.4%		36.4%		50.7%		35.3%

1 For explanation of adjusting items, refer to the corresponding “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section.2 Excludes intangible assets relating to software.

easyhome Financial Revenue

easyhome financial revenue is a non-IFRS measure. It’s calculated as total company revenue less easyfinancial revenue and leasing revenue. The Company believes that easyhome financial revenue is an important measure of the performance of the easyhome segment. Items used to calculate easyhome financial revenue for the three-month periods ended December 31, 2022 and 2021 include those indicated in the chart below:

($in 000’s)	Three Months Ended
	December 31,2022		December 31,2021
Total company revenue	273,326		234,430
Less: easyfinancial revenue	(235,886	)	(196,015	)
Less: leasing revenue	(26,772	)	(29,456	)
easyhome financial revenue	10,668		8,959

Total Yield on Consumer Loans as a Percentage of Average Gross Consumer Loans Receivable

Total yield on consumer loans as a percentage of average gross consumer loans receivable is a non-IFRS ratio. See description in section “Portfolio Analysis” on page 33 of the Company’s MD&A for the year ended December 31, 2022. Items used to calculate total yield on consumer loans as a percentage of average gross consumer loans receivable for the three-month periods and years ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Year Ended
($in 000’s except percentages)	December 31,2022		December 31,2021		December 31,2022		December 31,2021
Total Company revenue	273,326		234,430		1,019,336		826,722
Less: Leasing revenue	(26,772	)	(29,456	)	(110,053	)	(119,585	)
Financial revenue	246,554		204,974		909,283		707,137
Multiplied by number of periods in a year	X 4		X 4		X 4/4		X 4/4
Divided by average gross consumer loans receivable	2,726,446		1,982,680		2,409,890		1,680,328
Total yield on consumer loans as a percentage of average gross consumer loans receivable (annualized)	36.2%		41.4%		37.7%		42.1%

Net Principal Written and Percentage Net Principal Written to New Customers

Net principal written (Net loan advances) is a non-IFRS measure. See description in section “Portfolio Analysis” on page 33 of the Company’s MD&A for the year ended December 31, 2022. Percentage of net loan advances issued to new customers is a non-IFRS ratio. It is calculated as loan originations to new customers divided by net principal written. The Company uses percentage of net loan advances issued to new customers, among other measures, to assess the operating performance of its lending business. Items used to calculate percentage of net loan advances issued to new customers for the three-month periods ended December 31, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	December 31,2022		December 31,2021
Gross loan originations	632,355		506,853
Loan originations to new customers	299,458		215,939
Loan originations to existing customers	332,897		290,914
Less: Proceeds applied to repay existing loans	(177,848	)	(152,153	)
Net advance to existing customers	155,049		138,761
Net principal written	454,507		354,700
Percentage net advances to new customers	66%		61%

Net Debt to Net Capitalization

Net debt to net capitalization is a capital management measure. Refer to “Financial Condition” section on page 54 of the Company’s MD&A for the year ended December 31, 2022.

Average Loan Book Per Branch

Average loan book per branch is a supplementary financial measure. It is calculated as gross consumer loans receivable held by easyfinancial branch locations divided by number of total easyfinancial branch locations.

Weighted Average Interest Rate

Weighted average interest rate is a supplementary financial measure. It Is calculated as the sum of individual loan balance multiplied by interest rate divided by gross consumer loans receivable.

Potential Monthly Leasing Revenue

Potential monthly leasing revenue is a supplementary financial measure. Refer to “Portfolio Analysis” section on page 33 of the Company’s MD&A for the year ended December 31, 2022.