ELEVATE CREDIT ANNOUNCES FOURTH QUARTER

& FULL YEAR 2019 RESULTS

Announces Record Net Income

$20 Million Increase to Share Repurchase Program

FORT WORTH, TX - February 10, 2020 - Elevate Credit, Inc. (NYSE: ELVT) ("Elevate" or the "Company"), a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, today announced results for the fourth quarter and full year ended December 31, 2019.

"While 2019 was a year of transition, I am very proud of the Company's execution against our strategic goals. We successfully deployed our new credit models, achieved record net income, and delivered bottom line value to our shareholders," said Elevate CEO Jason Harvison. "Elevate is well positioned to continue this trend in 2020 as we maintain focus on credit quality and shareholder returns, with an eye on measured growth. We remain wholeheartedly committed to responsibly serving the enormous needs of underserved American and British non-prime citizens."

Fourth Quarter 2019 Financial Highlights1

  • Net income: Net income for the three months ended December 31, 2019 totaled $8.3 million, or $0.19 per diluted share, more than doubling net income of $4.1 million, or $0.09 per diluted share, in the fourth quarter of 2018.
  • Revenue: Revenues decreased 9.8% for the fourth quarter of 2019 totaling $186.9 million compared with $207.3 million for the fourth quarter of 2018. Despite the drop in top-line revenue, gross profit for the fourth quarter of 2019 increased $0.3 million to $71.3 million from $71.0 million in the fourth quarter of 2018 due to improved credit quality and lower customer acquisition costs.
  • Combined loans receivable - principal: Combined loans receivable - principal totaled $640.8 million, a decrease of $7.7 million, or 1.2%, from $648.5 million at the prior year-end.
  • Customer acquisition cost: The average customer acquisition cost was $196 in the fourth quarter of 2019, below the targeted range of $250-$300 and lower than $202 for the prior-year quarter. The total number of new customer loans decreased from approximately 67,000 in the fourth quarter of 2018 to approximately 52,000 in the fourth quarter of 2019.
  • Adjusted EBITDA margin: The Adjusted EBITDA margin for the fourth quarter of 2019 was 16.7%, an increase from 15.4% in the prior year quarter. Adjusted EBITDA decreased slightly to $31.2 million, down from $31.9 million in the fourth quarter of 2018.

__________________________

1 Adjusted EBITDA, Adjusted EBITDA margin, and combined loans receivable - principal are non-GAAP financial measures. These terms are defined elsewhere in this release. Please see the schedules appearing later in this release for reconciliations of these non-GAAP measures to the most directly comparable GAAP measures.

1

Fiscal Year 2019 Financial Highlights1

  • Net income: Net income for the year ended December 31, 2019 totaled $32.2 million, or $0.73 per diluted share, compared to net income of $12.5 million, or $0.28 per diluted share, in the prior year.
  • Revenue: Revenues decreased 5.0% for the year ended December 31, 2019, totaling $747.0 million compared to $786.7 million for the prior-year period. Despite the drop in top-line revenue, gross profit for 2019 increased $31.9 million, or 12%, to $302.6 million from $270.7 million in 2018 due to improved credit quality and lower customer acquisition costs.
  • Customeracquisition cost: The average customer acquisition cost was $207 for the year ended December 31, 2019, below the targeted range of $250-$300, and lower than $245 for the prior year. The number of new customer loans for the year ended December 31, 2019 totaled approximately 248,000, a decrease of 22% from approximately 316,000 for the prior year period.
  • AdjustedEBITDAmargin:TheAdjustedEBITDAmarginfortheyearendedDecember 31,2019was18.6%, an increase from 14.8% in the prior year. Adjusted EBITDA increased to $138.7 million, up $22.6 million, or 20%, from $116.1 million in the prior year.

Liquidity and Capital Resources

Interest expense in the fourth quarter of 2019 decreased to $14.8 million from $20.9 million in the fourth quarter of 2018. For fiscal year 2019, interest expense totaled $66.6 million, down $12.6 million, or 16%, from $79.2 million in fiscal year 2018. This decrease resulted from a lower cost of funds, which decreased to approximately 12.1% in fiscal year 2019 versus 14.8% in the prior year.

The Company's return on equity2 doubled for the year ended December 31, 2019, increasing to 23.6% compared to 11.7% for the prior year. Additionally, the Company's debt-to-equity ratio decreased from 4.8 at December 31, 2018 to 3.6 at December 31, 2019.

The Company's Board of Directors authorized a $20 million increase to the Company's existing common stock repurchase program providing for the repurchase of up to $30 million of the Company's common stock through July 31, 2024. The prior authorization totaled $5 million for both fiscal years 2019 and 2020. The Company purchased $3.3 million of common shares under its $5 million authorization during the second half of 2019.

Financial Outlook

For the full year 2020, the Company expects total revenue of $750 million to $770 million, net income of $35 million to $40 million, or $0.80 to $0.90 in diluted earnings per share, and Adjusted EBITDAof $135 million to $145 million.

__________________________

  1. Adjusted EBITDA, Adjusted EBITDA margin, and combined loans receivable - principal are non-GAAP financial measures. These terms are defined elsewhere in this release. Please see the schedules appearing later in this release for reconciliations of these non-GAAP measures to the most directly comparable GAAP measures.
  2. Calculated by dividing annual net income by average stockholders' equity, based on the average of the beginning and ending balances for the periods presented.

2

Conference Call

The Company will host a conference call to discuss its fourth quarter and full-year 2019 financial results on Monday, February 10th at 4:00pm Central Time / 5:00pm Eastern Time. Interested parties may access the conference call live over the phone by dialing 1-877-407-0792 (domestic) or 1-201-689-8263 (international) and requesting the Elevate Fourth Quarter and Full Year 2019 Earnings Conference Call. Participants are asked to dial in a few minutes prior to the call to register for the event. The conference call will also be webcast live through Elevate's website at http:// www.elevate.com/investors.

An audio replay of the conference call will be available approximately three hours after the conference call until 11:59 pm ET on February 24, 2020, and can be accessed by dialing 1-844-512-2921 (domestic) or 1-412-317-6671 (international), and providing the passcode 13698115, or by accessing Elevate's website.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements contain words such as "may," "will," "might," "expect," "believe," "anticipate," "could," "would," "estimate," "continue," "pursue," or the negative thereof or comparable terminology, and may include (without limitation) information regarding the Company's expectations, goals or intentions regarding future performance.These statements may include words such as "anticipate," "estimate," "expect," "project," "plan," "intend," "believe," "may," "will," "should," "likely" and other words and terms of similar meaning. The forward-looking statements include statements regarding: our expectationsof future financialperformance includingour outlookfor full fiscalyear 2020 (includingall statements under the heading "Financial Outlook"); our potential to drive long-term earnings growth; our expectation of continued strong earnings through 2020; and the Company's targeted customer acquisition cost range of $250-$300. Forward- looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in any such statement. These risks and uncertainties include, but are not limited to: the Company's limited operating history in an evolving industry; new laws and regulations in the consumer lending industry in many jurisdictions that could restrict the consumer lending products and services the Company offers, impose additional compliance costs on theCompany,rendertheCompany'scurrentoperationsunprofitableorevenprohibittheCompany'scurrentoperations; scrutiny by regulators and payment processors of certain online lenders' access to the Automated Clearing House system to disburse and collect loan proceeds and repayments; a lack of sufficient debt financing at acceptable prices or disruptions in the credit markets; the impact of competition in our industry and innovation by our competitors; our ability to prevent security breaches, disruption in service and comparable events that could compromise the personal and confidential information held in our data systems, reduce the attractiveness of our platform or adversely impact our ability to service loans; and other risks related to litigation, compliance and regulation. Additional factors that couldcauseactualresultstodifferarediscussedundertheheading"RiskFactors"andinothersectionsoftheCompany's most recent Annual Report on Form 10-K, and in the Company's other current and periodic reports filed from time to time with the SEC. All forward-looking statements in this press release are made as of the date hereof, based on information available to the Company as of the date hereof, and the Company assumes no obligation to update any forward-looking statement.

3

About Elevate

Elevate (NYSE: ELVT), together with its bank partners, has originated $8.1 billion in non-prime credit to more than

2.4 million non-prime consumers to date and has saved its customers more than $6.5 billion versus the cost of payday loans. Its responsible, tech-enabled online credit solutions provide immediate relief to customers today and help them build a brighter financial future. The company is committed to rewarding borrowers' good financial behavior with features like interest rates that can go down over time, free financial training and free credit monitoring. Elevate's suite of groundbreaking credit products includes RISE, Elastic, Sunny and Today Card. For more information, please visit http://www.elevate.com.

Investor Relations:

Solebury Trout

Sloan Bohlen, (817) 928-1646investors@elevate.com

or

Media Inquiries:

Solebury Trout

Lisa Wolford, (917) 846-0881lwolford@soleburytrout.com

4

Elevate Credit, Inc. and Subsidiaries

Condensed Consolidated Income Statements

(Unaudited)

Three Months Ended

Years Ended

December 31,

December 31,

(Dollars in thousands, except share and per

2019

2018

2019

2018

share amounts)

Revenues

$

186,920

$

207,288

$

746,962

$

786,682

Cost of sales:

Provision for loan losses

97,738

117,343

364,241

411,979

Direct marketing costs

10,114

13,450

51,283

77,605

Other cost of sales

7,765

5,467

28,846

26,359

Total cost of sales

115,617

136,260

444,370

515,943

Gross profit

71,303

71,028

302,592

270,739

Operating expenses:

Compensation and benefits

24,769

24,195

103,070

94,382

Professional services

9,441

9,389

36,715

35,864

Selling and marketing

1,536

1,910

7,381

9,435

Occupancy and equipment

5,427

4,245

20,712

17,547

Depreciation and amortization

4,440

3,821

17,380

12,988

Other

1,642

1,631

5,911

5,649

Total operating expenses

47,255

45,191

191,169

175,865

Operating income

24,048

25,837

111,423

94,874

Other income (expense):

Net interest expense

(14,820)

(20,912)

(66,646)

(79,198)

Foreign currency transaction gain (loss)

1,301

(609)

334

(1,409)

Non-operating income (loss)

14

(312)

(681)

(350)

Total other expense

(13,505)

(21,833)

(66,993)

(80,957)

Income before taxes

10,543

4,004

44,430

13,917

Income tax expense (benefit)

2,254

(128)

12,247

1,408

Net income

$

8,289

$

4,132

$

32,183

$

12,509

Basic income per share

$

0.19

$

0.10

$

0.73

$

0.29

Diluted income per share

$

0.19

$

0.09

$

0.73

$

0.28

Basic weighted-average shares outstanding

44,009,459

43,197,914

43,805,845

42,791,061

Diluted weighted-average shares outstanding

44,587,331

43,838,128

44,338,205

44,299,304

5

Elevate Credit, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)

(Dollars in thousands)

ASSETS

Cash and cash equivalents*

Restricted cash

Loans receivable, net of allowance for loan losses of $86,996 and $91,608, respectively*

Prepaid expenses and other assets*

Operating lease right of use assets

Receivable from CSO lenders

Receivable from payment processors*

Deferred tax assets, net

Property and equipment, net

Goodwill

Intangible assets, net

December 31,

December 31,

2019

2018

$

88,913

$

58,313

2,294

2,591

573,677

561,694

11,608

11,418

10,191

-

8,696

16,183

10,651

21,716

10,139

21,628

49,989

41,579

16,027

16,027

1,402

1,712

Derivative assets, net*

-

412

Total assets

$

783,587

$

753,273

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable and accrued liabilities *

$

44,991

$

44,950

Operating lease liability

14,352

-

State and other taxes payable

605

681

Deferred revenue*

12,087

28,261

Notes payable, net*

555,063

562,590

Total liabilities

627,098

636,482

COMMITMENTS, CONTINGENCIES AND GUARANTEES

STOCKHOLDERS' EQUITY

Preferred stock

-

-

Common stock

18

18

Additional paid-in capital

193,061

183,244

Treasury stock

(3,344)

-

Accumulated deficit

(34,342)

(66,525)

Accumulated other comprehensive income

1,096

54

Total stockholders' equity

156,489

116,791

Total liabilities and stockholders' equity

$

783,587

$

753,273

  • These balances include certain assets and liabilities of variable interest entities ("VIEs") that can only be used to settle the liabilities of that respective VIE. All assets of the Company are pledged as security for the Company's outstanding debt, including debt held by the VIEs.

6

Non-GAAP Financial Measures

This press release and the attached financial tables contain certain non-GAAP financial measures, including Adjusted EBITDA,Adjusted EBITDAmargin, combined loans receivable - principal, combined loans receivable and combined loan loss reserve.

Adjusted EBITDA and Adjusted EBITDA margin

In addition to net income determined in accordance with GAAP, Elevate uses certain non-GAAP measures such as "Adjusted EBITDA" and "Adjusted EBITDA margin" in assessing its operating performance. Elevate believes these non-GAAP measures are appropriate measures to be used in evaluating the performance of its business.

Elevate defines Adjusted EBITDAas net income excluding the impact of income tax expense (benefit), non-operating (income) loss, foreign currency transaction (gain) loss associated with our UK operations, net interest expense, share- based compensation expense and depreciation and amortization expense. Elevate defines Adjusted EBITDA margin as Adjusted EBITDA divided by revenue.

Management believes thatAdjusted EBITDAandAdjusted EBITDAmargin are useful supplemental measures to assist management and investors in analyzing the operating performance of the business and provide greater transparency into the results of operations of our core business. Management uses this non-GAAP financial measure frequently in its decision-making because it provides supplemental information that facilitates internal comparisons to the historical operating performance of prior periods and gives an additional indication of Elevate's core operating performance. Elevate includes this non-GAAP financial measure in its earnings announcement in order to provide transparency to its investors and enable investors to better compare its operating performance with the operating performance of its competitors.

Adjusted EBITDA and Adjusted EBITDA margin should not be considered as alternatives to net income or any other performance measure derived in accordance with GAAP. Management's use of Adjusted EBITDA and Adjusted EBITDAmargin has limitations as an analytical tool, and investors should not consider it in isolation or as a substitute for analysis of the Company's results as reported under GAAP. Some of these limitations are:

  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect expected cash capital expenditure requirements for such replacements or for new capital assets;
  • Adjusted EBITDAdoes not reflect changes in, or cash requirements for, the Company's working capital needs; and
  • Adjusted EBITDAdoes not reflect interest associated with notes payable used for funding customer loans, for other corporate purposes or tax payments that may represent a reduction in cash available to the Company.

Additionally, Elevate's definition of Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.

The Company's Adjusted EBITDA guidance does not include certain charges and costs. The adjustments in future periods are generally expected to be similar to the kinds of charges and costs excluded fromAdjusted EBITDAin prior periods. The Company is not able to provide a reconciliation of the Company's non-GAAP financial guidance to the corresponding GAAP measure without unreasonable effort because of the uncertainty and variability of the nature and amount of these future charges and costs.

7

The following table presents a reconciliation of Adjusted EBITDA and Adjusted EBITDA margin to Elevate's net income for the three and twelve months ended December 31, 2019 and 2018:

(Dollars in thousands)

Three Months Ended

Years Ended

December 31,

December 31,

2019

2018

2019

2018

Net income

$

8,289

$

4,132

$

32,183

$

12,509

Adjustments:

Net interest expense

14,820

20,912

66,646

79,198

Share-based compensation

2,668

2,228

9,940

8,233

Foreign currency transaction (gain) loss

(1,301)

609

(334)

1,409

Depreciation and amortization

4,440

3,821

17,380

12,988

Non-operating (income) loss

(14)

312

681

350

Income tax expense (benefit)

2,254

(128)

12,247

1,408

Adjusted EBITDA

$

31,156

$

31,886

$

138,743

$

116,095

Adjusted EBITDA margin

16.7%

15.4%

18.6%

14.8%

8

Supplemental Schedules

9

Revenue by Product

Three Months Ended December 31, 2019

(Dollars in thousands)

Rise (US)(1)

Elastic (US)(2)

Total Domestic

Sunny (UK)

Total

Average combined

loans receivable -

principal(3)

$

328,571

$

251,779

$

580,350

$

41,227

$

621,577

Effective APR

124%

96%

112%

219%

119%

Finance charges

$

102,701

$

61,173

$

163,874

$

22,762

$

186,636

Other

(51)

313

262

22

284

Total revenue

$

102,650

$

61,486

$

164,136

$

22,784

$

186,920

Three Months Ended December 31, 2018

(Dollars in thousands)

Rise (US)(1)

Elastic (US)(2)

Total Domestic

Sunny (UK)

Total

Average combined

loans receivable -

$

301,085

$

288,917

$

590,002

$

50,886

$

640,888

principal(3)

Effective APR

138%

97%

118%

243%

128%

Finance charges

$

104,513

$

70,684

$

175,197

$

31,208

$

206,405

Other

517

320

837

46

883

Total revenue

$

105,030

$

71,004

$

176,034

$

31,254

$

207,288

  1. Includes loans originated by third-party lenders through the CSO programs, which are not included in the Company's condensed consolidated financial statements.
  2. Includes immaterial balances related to the Today Card, which expanded its test launch in November 2018.
  3. Average combined loans receivable - principal is calculated using daily principal balances. See the "Combined Loan Information" section for a reconciliation of this non-GAAP measure to the most comparable GAAP measure.

10

Revenue by Product (continued)

Year ended December 31, 2019

(Dollars in thousands)

Rise (US)(1)

Elastic (US)(2)

Total Domestic

Sunny (UK)

Total

Average combined

loans receivable -

$

306,785

$

254,549

$

561,334

$

48,262

$

609,596

principal(3)

Effective APR

127%

97%

113%

224%

122%

Finance charges

$

389,372

$

247,397

$

636,769

$

107,921

$

744,690

Other

982

1,121

2,103

169

2,272

Total revenue

$

390,354

$

248,518

$

638,872

$

108,090

$

746,962

Year ended December 31, 2018

(Dollars in thousands)

Rise (US)(1)

Elastic (US)(2)

Total Domestic

Sunny (UK)

Total

Average combined

loans receivable -

$

293,413

$

262,537

$

555,950

$

51,793

$

607,743

principal(3)

Effective APR

138%

97%

119%

237%

129%

Finance charges

$

405,224

$

254,561

$

659,785

$

122,688

$

782,473

Other

2,187

1,745

3,932

277

4,209

Total revenue

$

407,411

$

256,306

$

663,717

$

122,965

$

786,682

  1. Includes loans originated by third-party lenders through the CSO programs, which are not included in the Company's condensed consolidated financial statements.
  2. Includes immaterial balances related to the Today Card, which expanded its test launch in November 2018.
  3. Average combined loans receivable - principal is calculated using daily principal balances. See the "Combined Loan Information" section for a reconciliation of this non-GAAP measure to the most comparable GAAP measure.

11

Loan Loss Reserve by Product

Three Months Ended December 31, 2019

(Dollars in thousands)

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Combined loan loss

reserve(2):

Beginning balance

$

50,504

$

32,005

$

82,509

$

9,130

$

91,639

Net charge-offs

(58,388)

(32,453)

(90,841)

(10,028)

(100,869)

Provision for loan

59,983

30,341

90,324

7,414

97,738

losses

Effect of foreign

-

-

-

567

567

currency

Ending balance

$

52,099

$

29,893

$

81,992

$

7,083

$

89,075

Combined loans

$

373,676

$

267,903

$

641,579

$

38,686

$

680,265

receivable(2)(3)

Combined loan loss

reserve as a percentage of

ending combined loans

receivable

14%

11%

13%

18%

13%

Net charge-offs as a

percentage of revenues

57%

53%

55%

44%

54%

Provision for loan losses

as a percentage of

revenues

58%

49%

55%

33%

52%

Three Months Ended December 31, 2018

(Dollars in thousands)

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Combined loan loss

reserve(2):

Beginning balance

$

48,522

$

34,534

$

83,056

$

10,876

$

93,932

Net charge-offs

(61,638)

(40,441)

(102,079)

(12,938)

(115,017)

Provision for loan

losses

63,713

41,957

105,670

11,673

117,343

Effect of foreign

currency

-

-

-

(206)

(206)

Ending balance

$

50,597

$

36,050

$

86,647

$

9,405

$

96,052

Combined loans

receivable(2)(3)

$

333,001

$

303,418

$

636,419

$

56,709

$

693,128

Combined loan loss

reserve as a percentage of

ending combined loans

receivable

15%

12%

14%

17%

14%

Net charge-offs as a percentage of revenues

Provision for loan losses as a percentage of revenues

59%

57%

58%

41%

55%

61%

59%

60%

37%

57%

  1. Includes immaterial balances related to the Today Card, which expanded its test launch in November 2018.
  2. Not a financial measure prepared in accordance with GAAP. See the "Combined Loan Information" section for a reconciliation of this non-GAAP measure to the most comparable GAAP measure.
  3. Includes loans originated by third-party lenders through the CSO programs, which are not included in the Company's consolidated financial statements.

12

Loan Loss Reserve by Product (continued)

Year ended December 31, 2019

(Dollars in thousands)

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Combined loan loss

reserve(2):

Beginning balance

$

50,597

$

36,050

$

86,647

$

9,405

$

96,052

Net charge-offs

(205,577)

(124,740)

(330,317)

(41,141)

(371,458)

Provision for loan

207,079

118,583

325,662

38,579

364,241

losses

Effect of foreign

-

-

-

240

240

currency

Ending balance

$

52,099

$

29,893

$

81,992

$

7,083

$

89,075

Combined loans

$

373,676

$

267,903

$

641,579

$

38,686

$

680,265

receivable(2)(3)

Combined loan loss

reserve as a percentage of

ending combined loans

14%

11%

13%

18%

13%

receivable

Net charge-offs as a

53%

50%

52%

38%

50%

percentage of revenues

Provision for loan losses as

53%

48%

51%

36%

49%

a percentage of revenues

Year ended December 31, 2018

(Dollars in thousands)

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Combined loan loss

reserve(2):

Beginning balance

$

55,867

$

28,870

$

84,737

$

9,052

$

93,789

Net charge-offs

(228,569)

(131,719)

(360,288)

(48,872)

(409,160)

Provision for loan

223,299

138,899

362,198

49,781

411,979

losses

Effect of foreign

-

-

-

(556)

(556)

currency

Ending balance

$

50,597

$

36,050

$

86,647

$

9,405

$

96,052

Combined loans

$

333,001

$

303,418

$

636,419

$

56,709

$

693,128

receivable(2)(3)

Combined loan loss

reserve as a percentage of

ending combined loans

15%

12%

14%

17%

14%

receivable

Net charge-offs as a percentage of revenues

Provision for loan losses as a percentage of revenues

56%

51%

54%

40%

52%

55%

54%

55%

40%

52%

  1. Includes immaterial balances related to the Today Card, which expanded its test launch in November 2018.
  2. Not a financial measure prepared in accordance with GAAP. See the "Combined Loan Information" section for a reconciliation of this non-GAAP measure to the most comparable GAAP measure.
  3. Includes loans originated by third-party lenders through the CSO programs, which are not included in the Company's consolidated financial statements.

13

Customer Loan Data by Product

Three Months Ended December 31, 2019

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Beginning number of

combined loans

148,251

152,647

300,898

89,965

390,863

outstanding

New customer loans

28,163

12,000

40,163

11,359

51,522

originated

Former customer loans

24,815

14

24,829

-

24,829

originated

Attrition

(48,794)

(15,137)

(63,931)

(28,799)

(92,730)

Ending number of

combined loans

152,435

149,524

301,959

72,525

374,484

outstanding

Customer acquisition

$

242

$

212

$

233

$

67

$

196

cost

Average customer loan

$

2,297

$

1,719

$

2,011

$

464

$

1,711

balance

Three Months Ended December 31, 2018

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Beginning number of

combined loans

140,218

167,045

307,263

94,173

401,436

outstanding

New customer loans

28,838

18,388

47,226

19,450

66,676

originated

Former customer loans

24,645

140

24,785

-

24,785

originated

Attrition

(50,943)

(19,176)

(70,119)

(24,174)

(94,293)

Ending number of

combined loans

142,758

166,397

309,155

89,449

398,604

outstanding

Customer acquisition

$

216

$

253

$

231

$

132

$

202

cost

Average customer loan

$

2,167

$

1,746

$

1,940

$

544

$

1,627

balance

  1. Includes immaterial balances related to the Today Card, which expanded its test launch in November 2018.

14

Customer Loan Data by Product (continued)

Year ended December 31, 2019

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Beginning number of

combined loans

142,758

166,397

309,155

89,449

398,604

outstanding

New customer loans

108,813

50,912

159,725

87,981

247,706

originated

Former customer loans

80,624

62

80,686

-

80,686

originated

Attrition

(179,760)

(67,847)

(247,607)

(104,905)

(352,512)

Ending number of

combined loans

152,435

149,524

301,959

72,525

374,484

outstanding

Customer acquisition

$

248

$

226

$

241

$

145

$

207

cost

Year ended December 31, 2018

Rise (US)

Elastic (US)(1)

Total Domestic

Sunny (UK)

Total

Beginning number of

combined loans

140,790

140,672

281,462

80,510

361,972

outstanding

New customer loans

111,860

99,820

211,680

104,803

316,483

originated

Former customer loans

86,278

746

87,024

-

87,024

originated

Attrition

(196,170)

(74,841)

(271,011)

(95,864)

(366,875)

Ending number of

combined loans

142,758

166,397

309,155

89,449

398,604

outstanding

Customer acquisition

$

275

$

240

$

259

$

218

$

245

cost

  1. Includes immaterial balances related to the Today Card, which expanded its test launch in November 2018.

15

Combined Loan Information

The Elastic line of credit product is originated by a third party lender, Republic Bank, which initially provides all of the funding for that product. Republic Bank retains 10% of the balances of all of the loans originated and sells a 90% loan participation in the Elastic lines of credit to a third party SPV, Elastic SPV, Ltd. Elevate is required to consolidate Elastic SPV, Ltd., as a variable interest entity under GAAP, and the condensed consolidated financial statements include revenue, losses and loans receivable related to the 90% of Elastic lines of credit originated by Republic Bank and sold to Elastic SPV, Ltd.

Beginning in the fourth quarter of 2018, the Company also licensed its Rise installment loan brand to a third party lender, FinWise Bank, which originates Rise installment loans in nineteen states. FinWise Bank initially provides all of the funding and retains a percentage of the balances of all of the loans originated and sells the remaining loan participation in those Rise installment loans to a third party SPV, EF SPV, Ltd. Prior to August 1, 2019, FinWise Bank retained 5% of the balances, and sold a 95% participation to EF SPV, Ltd. Starting August 1, 2019, the participation percentage changed to 96%. Elevate is required to consolidate EF SPV, Ltd., as a variable interest entity under GAAP, and the condensed consolidated financial statements include revenue, losses and loans receivable related to the 96% of Rise installment loans originated by FinWise Bank and sold to EF SPV, Ltd.

Elevate defines combined loans receivable - principal as loans owned by the Company plus loans originated and owned by third-party lenders pursuant to our CSO programs. In Texas, the Company does not make Rise loans directly, but rather acts as a Credit Services Organization (which is also known as a Credit Access Business), or, "CSO," and the loans are originated by an unaffiliated third party. There are no new loan originations in Ohio commencing in April 2019, but the Company continues to have obligations as the CSO until the wind-down of this portfolio is complete. Elevate defines combined loan loss reserve as the loan loss reserve for loans owned by the Company plus the loan loss reserve for loans originated and owned by third-party lenders and guaranteed by the Company. The information presented in the tables below on a combined basis are non-GAAP measures based on a combined portfolio of loans, which includes the total amount of outstanding loans receivable that the Company owns and that are on the Company's condensed consolidated balance sheets plus outstanding loans receivable originated and owned by third parties that the Company guarantees pursuant to CSO programs in which the Company participates.

The Company believes these non-GAAP measures provide investors with important information needed to evaluate the magnitude of potential loan losses and the opportunity for revenue performance of the combined loan portfolio on an aggregate basis. The Company also believes that the comparison of the combined amounts from period to period is more meaningful than comparing only the amounts reflected on the Company's condensed consolidated balance sheets since both revenues and cost of sales as reflected in the Company's condensed consolidated financial statements are impacted by the aggregate amount of loans the Company owns and those CSO loans the Company guarantees.

The Company's use of total combined loans and fees receivable has limitations as an analytical tool, and investors should not consider it in isolation or as a substitute for analysis of the Company's results as reported under GAAP. Some of these limitations are:

  • Rise CSO loans are originated and owned by a third party lender; and
  • Rise CSO loans are funded by a third party lender and are not part of the VPC Facility.

As of each of the period ends indicated, the following table presents a reconciliation of:

  • Loans receivable, net, Company owned (which reconciles to the Company's condensed consolidated balance sheets included elsewhere in this press release);
  • Loans receivable, net, guaranteed by the Company;
  • Combined loans receivable (which the Company uses as a non-GAAP measure); and
  • Combined loan loss reserve (which the Company uses as a non-GAAP measure).

16

2018

2019

(Dollars in thousands)

March 31

June 30

September 30

December 31

March 31

June 30

September 30

December 31

Company Owned Loans:

Loans receivable - principal, current, company

owned

$

471,996

$

493,908

$

525,717

$

543,405

$

491,208

$

523,785

$

543,565

$

559,169

Loans receivable - principal, past due, company

owned

60,876

58,949

69,934

68,251

55,286

55,711

65,824

63,413

Loans receivable - principal, total, company owned

Loans receivable - finance charges, company owned

Loans receivable - company owned

Allowance for loan losses on loans receivable, company owned

532,872

552,857

595,651

611,656

546,494

579,496

609,389

622,582

31,181

31,519

36,747

41,646

32,491

31,805

35,702

38,091

564,053

584,376

632,398

653,302

578,985

611,301

645,091

660,673

(80,497)

(76,575)

(89,422)

(91,608)

(76,457)

(75,896)

(89,667)

(86,996)

Loans receivable, net, company owned

$

483,556

$

507,801

$

542,976

$

561,694

$

502,528

$

535,405

$

555,424

$

573,677

Third Party Loans Guaranteed by the Company:

Loans receivable - principal, current, guaranteed by

company

$

33,469

$

35,114

$

36,649

$

35,529

$

27,941

$

21,099

$

18,633

$

17,474

Loans receivable - principal, past due, guaranteed

by company

1,123

1,494

1,661

1,353

696

596

697

723

Loans receivable - principal, total, guaranteed by

company(1)

34,592

36,608

38,310

36,882

28,637

21,695

19,330

18,197

Loans receivable - finance charges, guaranteed by

company(2)

2,612

2,777

3,103

2,944

2,164

1,676

1,553

1,395

Loans receivable - guaranteed by company

37,204

39,385

41,413

39,826

30,801

23,371

20,883

19,592

Liability for losses on loans receivable, guaranteed

by company

(3,749)

(3,956)

(4,510)

(4,444)

(3,242)

(1,983)

(1,972)

(2,079)

Loans receivable, net, guaranteed by company(3)

$

33,455

$

35,429

$

36,903

$

35,382

$

27,559

$

21,388

$

18,911

$

17,513

Combined Loans Receivable(3):

Combined loans receivable - principal, current

$

505,465

$

529,022

$

562,366

$

578,934

$

519,149

$

544,884

$

562,198

$

576,643

Combined loans receivable - principal, past due

61,999

60,443

71,595

69,604

55,982

56,307

66,521

64,136

Combined loans receivable - principal

567,464

589,465

633,961

648,538

575,131

601,191

628,719

640,779

Combined loans receivable - finance charges

33,793

34,296

39,850

44,590

34,655

33,481

37,255

39,486

Combined loans receivable

$

601,257

$

623,761

$

673,811

$

693,128

$

609,786

$

634,672

$

665,974

$

680,265

17

2018

2019

(dollars in thousands)

March 31

June 30

September 30

December 31

March 31

June 30

September 30

December 31

Combined Loan Loss Reserve(3):

Allowance for loan losses on loans receivable,

company owned

$

(80,497)

$

(76,575)

$

(89,422)

$

(91,608)

$

(76,457)

$

(75,896)

$

(89,667)

$

(86,996)

Liability for losses on loans receivable, guaranteed

by company

(3,749)

(3,956)

(4,510)

(4,444)

(3,242)

(1,983)

(1,972)

(2,079)

Combined loan loss reserve

$

(84,246)

$

(80,531)

$

(93,932)

$

(96,052)

$

(79,699)

$

(77,879)

$

(91,639)

$

(89,075)

Combined loans receivable - principal, past due(3)

$

61,999

$

60,443

$

71,595

$

69,604

$

55,982

$

56,307

$

66,521

$

64,136

Combined loans receivable - principal(3)

Percentage past due

Combined loan loss reserve as a percentage of combined loans receivable(3)

Allowance for loan losses as a percentage of loans receivable - company owned

567,464

589,465

633,961

648,538

575,131

601,191

628,719

640,779

11%

10%

11%

11%

10%

9%

11%

10%

14%

13%

14%

14%

13%

12%

14%

13%

14%

13%

14%

14%

13%

12%

14%

13%

  1. Represents loans originated by third-party lenders through the CSO programs, which are not included in the Company's condensed consolidated financial statements.
  2. Represents finance charges earned by third-party lenders through the CSO programs, which are not included in the Company's condensed consolidated financial statements.
  3. Non-GAAPmeasure.

18

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Elevate Credit Inc. published this content on 10 February 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 February 2020 21:17:04 UTC