SUMMARY AND ANALYSIS OF ENOVA INTERNATIONAL’S FINANCIAL REPORT

Overview

Enova International, Inc. is a leading financial technology company that provides online financial services to non-prime consumers and small businesses. The company’s key financial highlights for the year ended December 31, 2024 include:

• Revenue increased 25.5% to $2,657.8 million, driven by growth in both the consumer and small business loan portfolios.
• Net revenue increased 24.4% to $1,529.4 million, with a net revenue margin of 57.5%.
• Income from operations increased 38.5% to $584.8 million.
• Net income was $209.4 million, with diluted earnings per share of $7.43.

Revenue and Net Revenue

Enova’s revenue growth was primarily driven by a 21.7% increase in revenue from the consumer loan portfolio and a 32.0% increase in revenue from the small business loan portfolio. This was due to higher origination volumes leading to larger loan balances in both segments.

The company’s net revenue margin decreased slightly from 58.1% in 2023 to 57.5% in 2024, driven by lower margins in the consumer loan portfolio, partially offset by higher margins in the small business portfolio.

Loan and Finance Receivable Balances

The fair value of Enova’s loan and finance receivable portfolio increased to $4,386.4 million at the end of 2024, up from $3,629.2 million at the end of 2023. This was due to higher origination volumes outpacing repayments. The ratio of fair value to principal was relatively stable at 115.1% in 2024 compared to 115.0% in 2023.

Credit Performance

Enova closely monitors the credit performance of its loan portfolios. In the consumer segment, the percentage of loans over 30 days delinquent increased to 8.2% at the end of 2024 from 7.2% at the end of 2023, driven by a higher percentage of originations to new customers and a shift towards higher-yielding but riskier line of credit products.

In the small business segment, the percentage of loans over 30 days delinquent decreased to 7.0% at the end of 2024 from 8.4% at the end of 2023, indicating improved credit performance.

Expenses

Total operating expenses increased 16.9% to $944.7 million in 2024, primarily due to a 26.3% increase in marketing expenses to support business growth. Operations and technology expenses also increased 15.1%, while general and administrative expenses decreased 2.3% due to the prior year’s CFPB settlement charge.

Nonoperating Items

Interest expense increased 49.1% to $290.4 million in 2024 due to higher average debt levels and interest rates. Enova also recorded a $16.5 million equity method investment loss related to the write-down of its investment in Linear.

Liquidity and Capital Resources

Enova maintained a strong liquidity position, with $322.7 million in cash and restricted cash at the end of 2024. The company issued $217.2 million in asset-backed notes and entered into a $150 million consumer loan securitization facility to fund growth in the consumer loan portfolio. It also issued $660.9 million in asset-backed notes to fund the small business loan portfolio.

Enova’s total debt to Adjusted EBITDA ratio improved to 5.4x in 2024 from 5.9x in 2023, indicating stronger leverage. The company also repurchased $274.5 million of its common stock during the year.

Outlook

Enova’s financial performance in 2024 demonstrates its ability to grow its loan portfolios while maintaining strong credit quality and profitability. The company’s investments in technology, data analytics, and risk management have allowed it to navigate the evolving regulatory landscape and capitalize on demand for its financial services.

Looking ahead, Enova will likely continue to focus on expanding its consumer and small business lending businesses, while closely monitoring credit trends and managing its liquidity and capital resources. The company’s diversified product offerings, robust underwriting capabilities, and disciplined approach to risk management position it well to navigate future challenges and capitalize on growth opportunities.