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 second quarter ended June 30, 2022.                Second Quarter Results

During the quarter, the Company experienced record loan originations of $628 million, up 66% compared to the $379 million produced in the second quarter of 2021. The increase in lending was driven by a record volume of applications for credit, which were up 51% over the prior year, leading to a record level of loan originations across several of the company’s products and acquisition channels. 

The improved loan originations led to record organic growth in the loan portfolio of $216 million, which was up 191% from $74 million of organic loan growth in the second quarter of 2021. At quarter end, the gross consumer loan receivable portfolio was $2.37 billion, up 32% from $1.80 billion in the second quarter of 2021. The growth in consumer loans led to an increase in revenue, which was a record $252 million in the quarter, up 24% over the same period last year. 

During the quarter, the Company also continued to experience stable credit and payment performance. The net charge off rate in the second quarter was 9.3%, in line with the Company’s target range of between 8.5% and 10.5% on an annualized basis, and up from 8.2% in the second quarter of 2021, a period which benefited from pandemic related government support and reduced consumer expenses. The Company’s allowance for future credit losses decreased slightly to 7.68% from 7.78% in the first quarter of 2022, primarily due to the improved product and credit mix of the loan portfolio.

Operating income for the second quarter of 2022 was a record $85.2 million, up 52% from $56.1 million in the second quarter of 2021. Operating margin for the second quarter was 33.8%, up from 27.7% in the prior year. After adjustments for items related to the acquisition of LendCare Holdings Inc. (“LendCare”), the Company reported record adjusted operating income2 of $88.7 million, up $8.9 million or an increase of 11% compared to $79.9 million in the second quarter of 2021. Adjusted operating margin1 for the second quarter was 35.3%, down from 39.5% in the prior year, primarily due to a higher level of loan loss provision expense compared to the prior year.

Net income in the second quarter was $38.3 million, up 97% from $19.5 million in the same period of 2021, which resulted in diluted earnings per share of $2.32, up 100% from the $1.16 reported in the second quarter of 2021. After adjusting for non-recurring and unusual items on an after-tax basis, including $2.4 million in amortization of acquired intangible assets and a $5.9 million fair value loss on investments, adjusted net income2 was $46.8 million, up 7% from $43.7 million in 2021. Adjusted diluted earnings per share1 was a record $2.83, up 8% from $2.61 in the second quarter of 2021. Return on equity during the quarter was 20.2%, compared to 12.0% in the second quarter of 2021. After adjusting for non-recurring and unusual items, adjusted return on equity1 was 24.7% in the quarter, compared to 26.9% in the same period of 2021.

“We are delighted to report record organic loan growth of $216 million in the quarter, complemented by stable credit performance. While the increase in loan growth over last year resulted in approximately $0.48 cents of incremental loan loss provision expense on an after-tax per share basis in the quarter, it will contribute to the long-term earnings growth of the company. Growth in our secured lending products, such as home equity, powersports and automotive financing, lifted meaningfully, while also helping improve the credit mix of our portfolio. The annualized net charge-off rate in the quarter was 9.3%, directly in line with our target range, and down meaningfully from the 13.3% we reported prior to the pandemic in 2019, due to the significant structural improvements we have made to the business. All combined, we delivered record adjusted earnings per share1 of $2.83,” said Jason Mullins, goeasy’s President and Chief Executive Officer. “As a result of the strength in the business, we have updated our forecast to reflect recent trends. We now expect the loan portfolio to approach nearly $4 billion in 2024, with a stable outlook for credit performance, driven by a disciplined approach to growth and credit risk management. With all our major initiatives working together, we remain on our journey to be the leading non-prime lender in Canada,” Mr. Mullins concluded.

Other Key Second Quarter Highlights

easyfinancial

• Revenue of $214 million, up 30%
• 36% of the loan portfolio secured, up from 33%
• 65% of net loan advances in the quarter were issued to new customers, consistent year over year
• Record net customer growth during the quarter of 12,157
• Record home equity originations, which increased 169%
• Record powersports financing originations, which increased 59%
• Record automotive financing originations of $50 million, which increased 451%
• Average loan book per branch3 improved to $4.3 million, an increase of 14%
• Weighted average interest rate3 on consumer loans of 31.7%, down from 33.7%
• Record operating income of $95.6 million, up 28%
• Operating margin of 44.6%, down from 45.4%

easyhome

• Revenue of $37.5 million, broadly flat year over year
• Same store revenue growth3 of 2.8%
• Consumer loan portfolio within easyhome stores increased to $77.1 million, up 35%
• Financial revenue1 from consumer lending increased to $9.9 million, up 35% from $7.3 million
• Operating income of $8.7 million, down 6%
• Operating margin of 23.3%, down from 24.9%

Overall

• 49th consecutive quarter of same store revenue growth3
• 84th consecutive quarter of positive net income
• 2022 marks the 18th consecutive year of paying dividends and the 8th consecutive year of a dividend increase
• Total same store revenue growth3 of 16.8%
• Total customers served over 1.2 million
• Record adjusted return on tangible common equity1 of 38.0%, up from 34.8% in the second quarter of 2021
• Fully drawn weighted average cost of borrowing at 4.9%
• Net debt to net capitalization4 of 70% on June 30, 2022, up from 64% in the prior year and in line with the Company’s target leverage ratio

Six Months Results

For the first six months of 2022, the Company produced record revenues of $484 million, up 30% compared with $373 million in the same period of 2021. Operating income for the period was a record $165 million compared with $120 million in the first six months of 2021, an increase of $45.1 million or 38%. Net income for the first six months of 2022 was $64.4 million and diluted earnings per share was $3.86, compared with $131.4 million or $8.10 per share. Excluding the effects of the adjusting items related to the acquisition of LendCare, corporate development costs and fair value mark-to-market impact on investments, adjusted net income2 for the first six months of 2022 was a record $92.6 million and adjusted diluted earnings per share1 was a record $5.55 compared with $80.4 million or $4.95 per share, increases of 15% and 12%, respectively. Reported return on equity was 16.7%, while adjusted return on equity1 was 24.1%, down from 27.7% in 2021.

Balance Sheet and Liquidity

Total assets were $2.90 billion as of June 30, 2022, an increase of 18% from $2.45 billion as of June 30, 2021, primarily driven by growth in the consumer loan portfolio and partially offset by the decrease in investments mainly due to the disposal of the non-contingent portion of the equity investment in Affirm Holdings Inc. (“Affirm”).

During the quarter, the Company entered into a strategic commercial partnership and agreed to make a minority equity investment of $40 million in Canada Drives, Canada’s largest 100% online car shopping and to-your-door delivery platform. As of June 30, 2022, the Company invested $15 million in convertible notes and committed to purchase an additional $25 million in convertible notes on or before January 1, 2023. The convertible notes mature on June 15, 2025, bear interest at 5% annually and are convertible into preferred shares on defined terms. Through the new strategic partnership, goeasy’s automotive and point-of-sale financing brand, LendCare, will become a preferred non-bank financing provider within Canada Drives’ online automotive retail platform. goeasy will provide automotive financing to a committed portion of the non-prime borrowers who purchase and finance a vehicle through Canada Drives’ platform.

During the quarter, the Company increased its existing revolving securitization warehouse facility (“Securitization Facility”) by $500 million to a total facility of $1.4 billion. The amendment to the Securitization Facility incorporates key modifications including improved eligibility criteria for consumer loans, as well as pool concentration limits, resulting in increased funding capacity. The lending syndicate for the Securitization Facility continues to consist of National Bank Financial Markets, Bank of Montreal and Royal Bank of Canada, and the facility continues to bear 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 2.94% as of August 8, 2022, the interest rate would be 4.79%. The Company also continues utilizing 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.

During the second quarter of 2022, the Company recognized a $6.8 million pre-tax net fair value loss on its investments, which was mainly related to the unhedged contingent shares of its investment in Affirm. The unrealized fair value loss in Affirm during the period was partially offset by the realized fair value gain in the related total return swaps (“TRS”). Since the initial shares of Affirm were obtained on January 1, 2021, the Company has recognized a realized gain on the non-contingent portion of the investment in Affirm and its related TRS of $66.3 million, a realized gain on the TRS related to the contingent portion of the investment in Affirm of $25.4 million, and an unrealized fair value loss on the contingent portion of the investment in Affirm of $4.5 million. Including the cash received on the initial sale of PayBright Inc. (“PayBright”) to Affirm, the total realized and unrealized gains amount to $109 million, relative to the initial investment of $34 million made in 2019, or approximately 3.2 times the initial investment.

Free cash flow from operations before net growth in gross consumer loans receivable2 in the quarter was $56.9 million, up 18% from $48.2 million in the second quarter of 2021. Based on the cash on hand at the end of the quarter and the borrowing capacity under the Company’s revolving credit facilities, goeasy has approximately $1.09 billion in total funding capacity, which it estimates is sufficient to fund its organic growth through the second quarter of 2025. At quarter-end, the Company’s fully drawn weighted average cost of borrowing was at 4.9%. The Company also estimates that once its existing and available sources of capital are fully utilized, it could continue to grow the loan portfolio by approximately $250 million per year solely from internal cash flows. The Company also estimates that if it were to run-off its consumer loan and consumer leasing portfolios, the value of the total cash repayments paid to the Company over the remaining life of its contracts would be approximately $3.3 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.

Updated Outlook

On February 16, 2022, the Company provided a 3-year forecast for the years 2022 through 2024. The Company has since experienced accelerated growth in its consumer loans receivable portfolio and consequently, the Company has revised its forecast for the years 2022 through 2024 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 portfolio1 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 2022	Forecasts for 2023	Forecasts for 2024
Gross consumer loans receivable at year end	$2.6 - $2.8 billion	$3.2 - $3.4 billion	$3.8 - $4.0 billion
New easyfinancial locations to be opened during the year	10 - 15	10 - 15	5
Total Company revenue	$1.00 - $1.04 billion	$1.14 - $1.20 billion	$1.30 - $1.38 billion
Total yield on consumer loans (including ancillary products)1	36.5% - 38.5%	35.0% - 37.0%	34.0% - 36.0%
Net charge offs as a percentage of average gross consumer loans receivable	8.5% - 10.5%	8.5% - 10.5%	8.0% - 10.0%
Total Company Operating Margin	35% +	36% +	37% +
Return on Equity	22% +	22% +	22% +

Dividend

The Board of Directors has approved a quarterly dividend of $0.91 per share payable on October 14, 2022 to the holders of common shares of record as at the close of business on September 30, 2022.

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, expected financial performance and condition, the estimated number of new locations to be opened, targets for growth of the consumer loans receivable portfolio, annual revenue growth targets, strategic initiatives, new product offerings and new delivery channels, anticipated cost savings, planned capital expenditures, anticipated capital requirements, liquidity of the Company, plans and references to future operations and results and critical accounting estimates. In certain cases, forward-looking statements are 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 ‘expects’, ‘anticipates’, ‘intends’, ‘plans’, ‘believes’, ‘budgeted’, ‘estimates’, ‘forecasts’, ‘targets’ 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, as well as those factors referred to in the Company’s most recent Annual Information Form and Management’s Discussion and Analysis, as available on www.sedar.com, in the section entitled “Risk Factors”. 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, due to, but not limited to, important factors such as the Company’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, purchase 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, 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.

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., a Canadian company, headquartered in Mississauga, Ontario, provides non-prime leasing and lending services through its easyhome, easyfinancial and LendCare brands. Supported by more than 2,300 employees, the Company offers a wide variety of financial products and services including unsecured and secured instalment loans. Customers can transact seamlessly through an omni-channel model that includes an online and mobile platform, over 400 locations across Canada, and point-of-sale financing offered in the retail, powersports, automotive, home improvement and healthcare verticals, through more than 5,000 merchants across Canada. Throughout the Company’s history, it has acquired and organically served over 1.2 million Canadians and originated over $8.8 billion in loans, with one in three easyfinancial customers graduating to prime credit and 60% increasing their credit score within 12 months of borrowing.

Accredited by the Better Business Bureau, goeasy is the proud recipient of several awards including Waterstone Canada’s Most Admired Corporate Cultures, Glassdoor Top CEO Award, Achievers Top 50 Most Engaged Workplaces in North America, Greater Toronto Top Employers Award, the Digital Finance Institute’s Canada’s Top 50 FinTech Companies, ranking on the TSX30 and placing on the Report on Business ranking of Canada’s Top Growing Companies, honoured by The Globe and Mail’s Women Lead Here executive gender diversity benchmark and has been certified as a Great Place to Work®. The company is represented by a diverse group of team members from over 75 nationalities who believe strongly in giving back to the communities in which it operates. To date, goeasy has raised and donated over $4.39 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:

1 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.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Unaudited)
(expressed in thousands of Canadian dollars)
	As At	As At
	June 30,	December 31,
	2022	2021
ASSETS
Cash	95,900	102,479
Accounts receivable	22,877	20,769
Prepaid expenses	8,651	8,018
Income taxes recoverable	3,357	-
Consumer loans receivable, net	2,223,563	1,899,631
Investments	36,618	64,441
Lease assets	45,378	47,182
Property and equipment, net	34,811	35,285
Derivative financial assets	26,291	20,634
Intangible assets, net	157,871	159,651
Right-of-use assets, net	59,507	57,140
Goodwill	180,923	180,923
TOTAL ASSETS	2,895,747	2,596,153
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Revolving credit facility	143,331	-
Accounts payable and accrued liabilities	46,992	57,134
Income taxes payable	-	27,859
Dividends payable	14,407	10,692
Unearned revenue	20,592	11,354
Accrued interest	7,972	8,135
Deferred tax liabilities, net	29,923	38,648
Lease liabilities	68,168	65,607
Secured borrowings	138,378	173,959
Revolving securitization warehouse facility	526,095	292,814
Derivative financial liabilities	23,048	34,132
Notes payable	1,108,363	1,085,906
TOTAL LIABILITIES	2,127,269	1,806,240
Shareholders' equity
Share capital	357,377	363,514
Contributed surplus	18,630	22,583
Accumulated other comprehensive income	12,452	8,567
Retained earnings	380,019	395,249
TOTAL SHAREHOLDERS' EQUITY	768,478	789,913
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	2,895,747	2,596,153

 

goeasy Ltd.
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(expressed in thousands of Canadian dollars except earnings per share)
	Three Months Ended				Six Months Ended
	June 30,		June 30,		June 30,		June 30,
	2022		2021		2022		2021
REVENUE
Interest income	169,311		128,483		326,135		233,977
Lease revenue	25,948		28,348		52,826		56,785
Commissions earned	51,343		42,435		95,201		75,772
Charges and fees	5,050		3,090		9,632		5,996
	251,652		202,356		483,794		372,530
EXPENSES BEFORE DEPRECIATION AND AMORTIZATION
Salaries and benefits	43,908		43,804		85,872		79,210
Stock-based compensation	2,490		1,901		4,790		3,987
Advertising and promotion	9,383		7,172		18,893		13,064
Bad debts	67,936		48,873		122,085		78,147
Occupancy	6,184		5,753		12,563		11,277
Technology costs	5,460		4,017		10,700		7,821
Other expenses	10,799		15,409		22,662		22,504
	146,160		126,929		277,565		216,010
DEPRECIATION AND AMORTIZATION
Depreciation of lease assets	8,195		8,843		16,660		18,086
Amortization of intangible assets	4,915		4,134		10,128		5,880
Depreciation of right-of-use assets	4,971		4,422		9,840		8,766
Depreciation of property and equipment	2,228		1,938		4,453		3,766
	20,309		19,337		41,081		36,498
TOTAL OPERATING EXPENSES	166,469		146,266		318,646		252,508
OPERATING INCOME	85,183		56,090		165,148		120,022
OTHER (LOSS)  INCOME	(6,819	)	(4,086	)	(24,344	)	83,286
FINANCE COSTS
Interest expense and amortization of deferred financing charges	23,590		20,066		46,233		33,561
Interest expense on lease liabilities	855		756		1,691		1,497
	24,445		20,822		47,924		35,058
INCOME BEFORE INCOME TAXES	53,919		31,182		92,880		168,250
INCOME TAX EXPENSE (RECOVERY)
Current	20,325		15,811		36,621		32,808
Deferred	(4,706	)	(4,096	)	(8,137	)	4,000
	15,619		11,715		28,484		36,808
NET INCOME	38,300		19,467		64,396		131,442
BASIC EARNINGS PER SHARE	2.37		1.20		3.96		8.39
DILUTED EARNINGS PER SHARE	2.32		1.16		3.86		8.10

 

Segmented Reporting
	Three Months Ended June 30, 2022
($ in 000's except earnings per share)	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	162,140	7,171	-		169,311
Lease revenue	-	25,948	-		25,948
Commissions earned	47,897	3,446	-		51,343
Charges and fees	4,077	973	-		5,050
	214,114	37,538	-		251,652
Total operating expenses before depreciation and amortization	110,158	18,327	17,675		146,160
Depreciation and amortization
Depreciation and amortization of lease assets, property and equipment and intangible assets	5,626	8,485	1,227		15,338
Depreciation of right-of-use assets	2,748	1,988	235		4,971
	8,374	10,473	1,462		20,309
Segment operating income (loss)	95,582	8,738	(19,137	)	85,183
Other loss					(6,819	)
Finance costs
Interest expense and amortization of deferred financing charges					23,590
Interest expense on lease liabilities					855
					24,445
Income before income taxes					53,919
Income taxes					15,619
Net Income					38,300
Diluted earnings per share					2.32
	Three Months Ended June 30, 2021
($ in 000's except earnings per share)	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	123,036	5,447	-		128,483
Lease revenue	-	28,348	-		28,348
Commissions earned	39,665	2,770	-		42,435
Charges and fees	2,187	903	-		3,090
	164,888	37,468	-		202,356
Total operating expenses before depreciation and amortization	83,291	17,066	26,572		126,929
Depreciation and amortization
Depreciation and amortization of lease assets, property and equipment and intangible assets	4,458	9,165	1,292		14,915
Depreciation of right-of-use-assets	2,288	1,918	216		4,422
	6,746	11,083	1,508		19,337
Segment operating income (loss)	74,851	9,319	(28,080	)	56,090
Other loss					(4,086	)
Finance costs
Interest expense and amortization of deferred financing charges					20,066
Interest expense on lease liabilities					756
					20,822
Income before income taxes					31,182
Income taxes					11,715
Net Income					19,467
Diluted earnings per share					1.16
	Six Months Ended June 30, 2022
($ in 000's except earnings per share)	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	312,289	13,846	-		326,135
Lease revenue	-	52,826	-		52,826
Commissions earned	88,754	6,447	-		95,201
Charges and fees	7,681	1,951	-		9,632
	408,724	75,070	-		483,794
Total operating expenses before depreciation and amortization	205,810	35,775	35,980		277,565
Depreciation and amortization
Depreciation and amortization of lease assets, property and equipment and intangible assets	11,536	17,255	2,450		31,241
Depreciation of right-of-use assets	5,471	3,931	438		9,840
	17,007	21,186	2,888		41,081
Segment operating income (loss)	185,907	18,109	(38,868	)	165,148
Other loss					(24,344	)
Finance costs
Interest expense and amortization of deferred financing charges					46,233
Interest expense on lease liabilities					1,691
					47,924
Income before income taxes					92,880
Income taxes					28,484
Net Income					64,396
Diluted earnings per share					3.86
	Six Months Ended June 30, 2021
($ in 000's except earnings per share)	easyfinancial	easyhome	Corporate		Total
Revenue
Interest income	223,540	10,437	-		233,977
Lease revenue	-	56,785	-		56,785
Commissions earned	70,575	5,197	-		75,772
Charges and fees	4,102	1,894	-		5,996
	298,217	74,313	-		372,530
Total operating expenses before depreciation and amortization	140,617	33,391	42,002		216,010
Depreciation and amortization
Depreciation and amortization of lease assets, property and equipment and intangible assets	6,543	18,740	2,449		27,732
Depreciation of right-of-use-assets	4,509	3,826	431		8,766
	11,052	22,566	2,880		36,498
Segment operating income (loss)	146,548	18,356	(44,882	)	120,022
Other income					83,286
Finance costs
Interest expense and amortization of deferred financing charges					33,561
Interest expense on lease liabilities					1,497
					35,058
Income before income taxes					168,250
Income taxes					36,808
Net Income					131,442
Diluted earnings per share					8.10

Summary of Financial Results and Key Performance Indicators
($ in 000’s except earnings per share and percentages)	Three Months Ended				Variance		Variance
	June 30, 2022		June 30, 2021		$ / bps		% change
Summary Financial Results
Revenue	251,652		202,356		49,296		24.4	%
Operating expenses before depreciation and amortization2,3	146,160		126,929		19,231		15.2	%
EBITDA1	90,478		62,498		27,980		44.8	%
EBITDA margin1	36.0	%	30.9	%	510 bps		16.5	%
Depreciation and amortization expense2	20,309		19,337		972		5.0	%
Operating income	85,183		56,090		29,093		51.9	%
Operating margin	33.8	%	27.7	%	610 bps		22.0	%
Other loss2,3	(6,819	)	(4,086	)	(2,733	)	(66.9	%)
Finance costs3	24,445		20,822		3,623		17.4	%
Effective income tax rate	29.0	%	37.6	%	(860 bps)		(22.9	%)
Net income	38,300		19,467		18,833		96.7	%
Diluted earnings per share	2.32		1.16		1.16		100.0	%
Return on assets	5.5	%	3.8	%	170 bps		44.7	%
Return on equity	20.2	%	12.0	%	820 bps		68.3	%
Return on tangible common equity1	33.0	%	16.8	%	1620 bps		96.4	%
Adjusted Financial Results1,2,3
Adjusted operating income	88,740		79,870		8,870		11.1	%
Adjusted operating margin	35.3	%	39.5	%	(420 bps)		(10.6	%)
Adjusted net income	46,830		43,687		3,143		7.2	%
Adjusted diluted earnings per share	2.83		2.61		0.22		8.4	%
Adjusted return on assets	6.7	%	8.6	%	(190 bps)		(22.1	%)
Adjusted return on equity	24.7	%	26.9	%	(220 bps)		(8.2	%)
Adjusted return on tangible common equity	38.0	%	34.8	%	320 bps		9.2	%
Key Performance Indicators
Same store revenue growth (overall)1	16.8	%	20.2	%	(340 bps)		(16.8	%)
Same store revenue growth (easyhome)1	2.8	%	7.9	%	(510 bps)		(64.6	%)
Segment Financials
easyfinancial revenue	214,114		164,888		49,226		29.9	%
easyfinancial operating margin	44.6	%	45.4	%	(80 bps)		(1.8	%)
easyhome revenue	37,538		37,468		70		0.2	%
easyhome operating margin	23.3	%	24.9	%	(160 bps)		(6.4	%)
Portfolio Indicators
Gross consumer loans receivable	2,369,843		1,795,844		573,999		32.0	%
Growth in consumer loans receivable4	215,543		518,553		(303,010	)	(58.4	%)
Gross loan originations	628,189		379,082		249,107		65.7	%
Total yield on consumer loans (including ancillary products)1	39.0	%	42.8	%	(380 bps)		(8.9	%)
Net charge offs as a percentage of average gross consumer loans receivable	9.3	%	8.2	%	110 bps		13.4	%
Free cash flows from operation before net growth in gross consumer loans receivable1	56,918		48,246		8,672		18.0	%
Potential monthly lease revenue1	7,634		8,322		(688	)	(8.3	%)
1 EBITDA, 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, adjusted operating margin, adjusted diluted earnings per share, adjusted return on equity, adjusted return on asset, reported and adjusted return on tangible common equity and total yield on consumer loans (including ancillary products) are non-IFRS ratios. Same store revenue growth (overall), same store revenue growth (easyhome) and potential monthly leasing revenue are supplementary financial measures. See description in “Key Performance Indicators and Non-IFRS Measures” section in this press release. 2 During the three-month period ended June 30, 2022, the Company had a total of $10.4 million before-tax ($8.5 million after-tax) of adjusting items which include: Adjusting items related to the acquisition of LendCare • Integration costs related to consulting costs, employee incentives, representation and warranty insurance cost, and other integration costs related to the acquisition of LendCare. Integration costs amounting to $0.3 million before-tax ($0.2 million after-tax) were reported under Operating expenses before depreciation and amortization; • Amortization of $131 million intangible asset related to the acquisition of LendCare with an estimated useful life of ten years amounting to $3.3 million before-tax ($2.4 million after-tax); and Adjusting item related to other loss • Fair value losses mainly on investments in Affirm and its related TRS amounting to $6.8 million before-tax ($5.9 million after-tax). 3 During the three-month period ended June 30, 2021, the Company had a total of $29.6 million before-tax ($24.2 million after-tax) of adjusting items which include: Adjusting items related to the acquisition of LendCare • Transaction costs of $8.4 million before-tax ($8.0 million after-tax) which include advisory and consulting costs, legal costs, and other transaction costs related to the acquisition of LendCare reported under Operating expenses before depreciation and amortization. Amounting to $6.7 million which are non tax-deductible and loan commitment fee related to the acquisition of LendCare reported under Finance costs amounting to $1.7 million before-tax ($1.3 million after-tax); • Integration costs related to advisory and consulting costs, employee incentives, representation and warranty insurance cost, and other integration costs related to the acquisition of LendCare reported under Operating expense before depreciation and amortization amounting to $0.6 million before-tax ($0.5 million after-tax); • Bad debt expense related to the day one loan loss provision on the acquired loan portfolio from the LendCare amounting to $14.3 million before-tax ($10.5 million after-tax). Adjusting item related to other income • Fair value loss mainly on investments in Affirm and its related TRS amounting to $4.1 million before-tax ($3.5 million after-tax). 4 Growth in consumer loans receivable for the three-month period ended June 30, 2021 includes $444.5 million of gross loans purchased through the acquisition of LendCare.
($ in 000’s except earnings per share and percentages)	Six Months Ended				Variance		Variance
	June 30, 2022		June 30, 2021		$ / bps		% change
Summary Financial Results
Revenue	483,794		372,530		111,264		29.9	%
Operating expenses before depreciation and amortization2	277,565		216,010		61,555		28.5	%
EBITDA1	165,225		221,720		(56,495	)	(25.5	%)
EBITDA margin1	34.2	%	59.5	%	(2,530 bps)		-42.5	%
Depreciation and amortization expense2	41,081		36,498		4,583		12.6	%
Operating income	165,148		120,022		45,126		37.6	%
Operating margin	34.1	%	32.2	%	190 bps		5.9	%
Other income2,3	(24,344	)	83,286		(107,630	)	(129.2	%)
Finance costs3	47,924		35,058		12,866		36.7	%
Effective income tax rate	30.7	%	21.9	%	880 bps		40.2	%
Net income	64,396		131,442		(67,046	)	(51.0	%)
Diluted earnings per share	3.86		8.10		(4.24	)	(52.3	%)
Return on assets	4.7	%	14.2	%	(950 bps)		(66.9	%)
Return on equity	16.7	%	45.3	%	(2,860 bps)		(63.1	%)
Return on tangible common equity1	27.6	%	56.0	%	(2,840 bps)		(50.7	%)
Adjusted Financial Results1,2,3
Adjusted operating income	174,801		144,481		30,320		21.0	%
Adjusted operating margin	36.1	%	38.8	%	(270 bps)		(7.0	%)
Adjusted net income	92,609		80,366		12,243		15.2	%
Adjusted diluted earnings per share	5.55		4.95		0.60		12.1	%
Adjusted return on assets	6.8	%	8.7	%	(190 bps)		(21.8	%)
Adjusted return on equity	24.1	%	27.7	%	(360 bps)		(13.0	%)
Adjusted return on tangible common equity	36.9	%	33.8	%	310 bps		9.2	%
Key Performance Indicators
Same store revenue growth (overall)1	15.1	%	10.4	%	470 bps		45.2	%
Same store revenue growth (easyhome)1	2.8	%	6.4	%	(360 bps)		(56.3	%)
Segment Financials
easyfinancial revenue	408,724		298,217		110,507		37.1	%
easyfinancial operating margin	45.5	%	49.1	%	(360 bps)		(7.3	%)
easyhome revenue	75,070		74,313		757		1.0	%
easyhome operating margin	24.1	%	24.7	%	(60 bps)		(2.4	%)
Portfolio Indicators
Gross consumer loans receivable	2,369,843		1,795,844		573,999		32.0	%
Growth in consumer loans receivable4	339,504		549,004		(209,500	)	(38.2	%)
Gross loan originations	1,104,732		651,433		453,299		69.6	%
Total yield on consumer loans (including ancillary products)1	38.9	%	43.4	%	(450 bps)		(10.4	%)
Net charge-offs as a percentage of average gross consumer loans receivable	9.1	%	8.6	%	50 bps		5.8	%
Free cash flows from operation before net growth in gross consumer loans receivable1	96,846		111,412		(14,566	)	(13.1	%)
Potential monthly lease revenue1	7,634		8,322		(688	)	(8.3	%)
1 EBITDA, 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, adjusted operating margin, adjusted diluted earnings per share, adjusted return on equity, adjusted return on asset, reported and adjusted return on tangible common equity and total yield on consumer loans (including ancillary products) are non-IFRS ratios. Same store revenue growth (overall), same store revenue growth (easyhome) and potential monthly lease revenue are supplementary financial measures. Non-IFRS measures, non-IFRS ratios and supplemental financial 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. See description in “Key Performance Indicators and Non-IFRS Measures” section in this press release. 2 During the six months ended June 30, 2022, the Company had a total of $34.0 million before-tax ($28.2 million after-tax) adjusting items which include: Adjusting items related to corporate development costs • Corporate development costs of $2.3 million ($1.7 million after-tax) are related to the exploration of a strategic acquisition opportunity, which the company elect not to undertake, including advisory, consulting and legal costs reported under Operating expenses before depreciation and amortization. Adjusting items relating to the acquisition of LendCare • Integration costs related to consulting costs, employee incentives, representation and warranty insurance cost, and other integration costs related to the acquisition of LendCare. Integration costs amounting to $0.8 million before-tax ($0.6 million after-tax) were reported under Operating expenses before depreciation and amortization; • Amortization of $131 million intangible asset related to the acquisition of LendCare with an estimated useful life of ten years amounting to $6.6 million before-tax ($4.8 million after-tax). Adjusting item related to other income • Fair value loss mainly on investments in Affirm and its related TRS amounting to $24.3 million before-tax ($21.1 million after-tax). 3 During the six months ended June 30, 2021, the Company had a total of $57.1 million before-tax ($51.1 million after-tax) of adjusting items which include: • Transaction costs of $9.1 million before-tax ($8.7 million after-tax) which include advisory and consulting costs, legal costs, and other direct transaction costs amounting to $7.4 million related to the acquisition of LendCare reported under Operating expense before depreciation and amortization which are not tax deductible and loan commitment fee under Finance costs amounting to $1.7 million before-tax ($1.3 million after-tax). • Bad debt expense related to the day one loan loss provision on the acquired loan portfolio from LendCare amounting to $14.3 million before-tax ($10.5 million after-tax).   4 Growth in consumer loans receivable for the six-month period ended June 30, 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 Management’s Discussion & Analysis (“MD&A”), available on www.sedar.com.

Adjusted Net Income and Adjusted Diluted Earnings Per ShareAdjusted 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 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate adjusted net income and adjusted earnings per share for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Six Months Ended
($in 000’s except earnings per share)	June 30,2022		June 30,2021		June 30,2022		June 30,2021
Net income as stated	38,300		19,467		64,396		131,442
Impact of adjusting items
Operating expenses before depreciation and amortization
Corporate development costs1	-		-		2,314		-
Integration costs3	282		648		789		648
Transaction costs2	-		6,679		-		7,359
Day one loan loss provision on the acquired loans 4	-		14,252		-		14,252
Amortization of intangible assets
Amortization of acquired intangible assets 5	3,275		2,200		6,550		2,200
Other loss (income)6	6,819		4,086		24,344		(83,286	)
Finance costs
Transaction costs2	-		1,726		-		1,726
Total pre-tax impact of adjusting items	10,376		29,591		33,997		(57,101	)
Income tax impact of above adjusting items	(1,846	)	(5,371	)	(5,784	)	6,025
After-tax impact of adjusting items	8,530		24,220		28,213		(51,076	)
Adjusted net income	46,830		43,687		92,609		80,366
Weighted average number of diluted shares outstanding	16,522		16,768		16,677		16,230
Diluted earnings per share as stated	2.32		1.16		3.86		8.10
Per share impact of adjusting items	0.51		1.45		1.69		(3.15	)
Adjusted diluted earnings per share	2.83		2.61		5.55		4.95

Adjusting item related to corporate development costs1 Corporate development costs are related to the exploration of a strategic acquisition opportunity, which the Company elected to not undertake, including advisory, consulting and legal costs reported under Operating expenses before depreciation and amortization.Adjusting items related to the LendCare Acquisition2 Transaction costs included advisory and consulting costs, legal costs, and other direct transaction costs related to the acquisition of LendCare reported under Operating expenses before depreciation and amortization 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 cost, other integration costs related to the acquisition of LendCare. Integration costs were reported under Operating expenses before depreciation and amortization.4 Bad debt expense related to the day one loan loss provision on the acquired loan portfolio from LendCare.5 Amortization of $131 million intangible asset related to the acquisition of LendCare with an estimated useful life of ten years.Adjusting item related to other income (loss)6 For the three and six-month periods ended June 30, 2022 and 2021, fair value gains (losses) mainly related to investments in Affirm and its related TRS.

Adjusted Operating Income and Adjusted Operating MarginAdjusted 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 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate adjusted operating income and adjusted operating margins for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022(adjusted)		June 30,2021		June 30,2021(adjusted)
easyfinancial
Operating income	95,582		95,582		74,851		74,851
Divided by revenue	214,114		214,114		164,888		164,888
easyfinancial operating margin	44.6	%	44.6	%	45.4	%	45.4	%
easyhome
Operating income	8,738		8,738		9,319		9,319
Divided by revenue	37,538		37,538		37,468		37,468
easyhome operating margin	23.3	%	23.3	%	24.9	%	24.9	%
Total
Operating income	85,183		85,183		56,090		56,090
Operating expenses before depreciation and amortization1
Integration costs	-		282		-		648
Transaction costs	-		-		-		6,679
Day one loan loss provision on the acquired loans	-		-		-		14,252
Amortization of intangible assets1
Amortization of acquired intangible assets	-		3,275		-		2,200
Adjusted operating income	85,183		88,740		56,090		79,869
Divided by revenue	251,652		251,652		202,356		202,356
Total operating margin	33.8	%	35.3	%	27.7	%	39.5	%

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

	Six Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022(adjusted)		June 30,2021		June 30,2021(adjusted)
easyfinancial
Operating income	185,907		185,907		146,548		146,548
Divided by revenue	408,724		408,724		298,217		298,217
easyfinancial operating margin	45.5	%	45.5	%	49.1	%	49.1	%
easyhome
Operating income	18,109		18,109		18,356		18,356
Divided by revenue	75,070		75,070		74,313		74,313
easyhome operating margin	24.1	%	24.1	%	24.7	%	24.7	%
Total
Operating income	165,148		165,148		120,022		120,022
Operating expenses before depreciation and amortization1
Corporate development costs	-		2,314		-		-
Integration costs	-		789		-		648
Transaction costs	-		-		-		7,359
Day one loan loss provision on the acquired loans	-		-		-		14,252
Amortization of intangible assets1
Amortization of acquired intangible assets	-		6,550		-		2,200
Adjusted operating income	165,148		174,801		120,022		144,481
Divided by revenue	483,794		483,794		372,530		372,530
Total operating margin	34.1	%	36.1	%	32.2	%	38.8	%

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

Earnings before Interest, Taxes, Depreciation and Amortization (“EBITDA”) and EBITDA MarginEBITDA 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 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate EBITDA and EBITDA margin for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Six Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2021		June 30,2022		June 30,2021
Net income as stated	38,300		19,467		64,396		131,442
Finance cost	24,445		20,822		47,924		35,058
Income tax expense	15,619		11,715		28,484		36,808
Depreciation and amortization	20,309		19,337		41,081		36,498
Depreciation of lease assets	(8,195	)	(8,843	)	(16,660	)	(18,086	)
EBITDA	90,478		62,498		165,225		221,720
Divided by revenue	251,652		202,356		483,794		372,530
EBITDA margin	36.0	%	30.9	%	34.2	%	59.5	%

Free Cash Flow from Operations before Net Growth in Gross Consumer Loans ReceivableFree 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 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate free cash flow from operations before net growth in gross consumer loans receivable for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Six Months Ended
	June 30,2022		June 30,2021		June 30,2022		June 30,2021
Cash (used in) provided by operating activities	(158,625	)	(25,787	)	(242,658	)	6,928
Net growth in gross consumer loans receivable during the period1	215,543		74,033		339,504		104,484
Free cash flows from operations before net growth in gross consumer loans receivable	56,918		48,246		96,846		111,412

1 Excludes $444.5 million of gross loans purchased through the acquisition of LendCare in 2021.

Adjusted Return on AssetsAdjusted return on assets is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate adjusted return on assets for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022 (adjusted)		June 30,2021		June 30,2021 (adjusted)
Net income as stated	38,300		38,300		19,467		19,467
After-tax impact of adjusting items1	-		8,530		-		24,220
Adjusted net income	38,300		46,830		19,467		43,687
Multiplied by number of periods in a year	X 4		X 4		X 4		X 4
Divided by average total assets for the period	2,792,034		2,792,034		2,031,583		2,031,583
Return on assets	5.5	%	6.7	%	3.8	%	8.6	%

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

	Six Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022 (adjusted)		June 30,2021		June 30,2021 (adjusted)
Net income as stated	64,396		64,396		131,442		131,442
After-tax impact of adjusting items1	-		28,213		-		(51,076	)
Adjusted net income	63,396		92,609		131,442		80,366
Multiplied by number of periods in a year	X 4/2		X 4/2		X 4/2		X 4/2
Divided by average total assets for the period	2,726,740		2,726,740		1,855,027		1,855,027
Return on assets	4.7	%	6.8	%	14.2	%	8.7	%

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

Adjusted Return on EquityAdjusted return on equity is a non-IFRS ratio. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate adjusted return on equity for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022 (adjusted)		June 30,2021		June 30,2021 (adjusted)
Net income as stated	38,300		38,300		19,467		19,467
After-tax impact of adjusting items1	-		8,530		-		24,220
Adjusted net income	38,300		46,830		19,467		43,687
Multiplied by number of periods in a year	X 4		X 4		X 4		X 4
Divided by average shareholders’ equity for the period	759,896		759,896		649,529		649,529
Return on equity	20.2	%	24.7	%	12.0	%	26.9	%

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

	Six Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022 (adjusted)		June 30,2021		June 30,2021 (adjusted)
Net income as stated	64,396		64,396		131,442		131,442
After-tax impact of adjusting items1	-		28,213		-		(51,076	)
Adjusted net income	64,396		92,609		131,442		80,366
Multiplied by number of periods in a year	X 4/2		X 4/2		X 4/2		X 4/2
Divided by average shareholders’ equity for the period	769,902		769,902		580,856		580,856
Return on equity	16.7	%	24.1	%	45.3	%	27.7	%

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

Return on Tangible Common EquityReported and adjusted return on tangible common equity are non-IFRS ratios. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate reported and adjusted return on tangible common equity for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022 (adjusted)		June 30,2021		June 30,2021 (adjusted)
Net income as stated	38,300		38,300		19,467		19,467
Amortization of acquired intangible assets	3,275		3,275		2,200		2,200
Income tax impact of the above item	(868	)	(868	)	(583	)	(583	)
Net income before amortization of acquired intangible assets, net of income tax	40,707		40,707		21,084		21,084
Impact of adjusting items1
Operating expenses before depreciation and amortization
Integration costs	-		282		-		648
Transaction costs	-		-		-		6,679
Day one loan loss provision on the acquired loans	-		-		-		14,252
Other loss	-		6,819		-		4,086
Finance costs
Transaction costs	-		-		-		1,726
Total pre-tax impact of adjusting items	-		7,101		-		27,391
Income tax impact of above adjusting items	-		(978	)	-		(4,789	)
After-tax impact of adjusting items	-		6,123		-		22,602
Adjusted net income	40,707		46,830		21,084		43,686
Multiplied by number of periods in a year	X 4		X 4		X 4		X 4
Average shareholders’ equity	759,896		759,896		649,529		649,529
Average goodwill	(180,923	)	(180,923	)	(100,573	)	(100,573	)
Average acquired intangible assets2	(117,354	)	(117,354	)	(64,408	)	(64,408	)
Average related deferred tax liabilities	31,099		31,099		17,068		17,068
Divided by average tangible common equity	492,718		492,718		501,616		501,616
Return on tangible common equity	33.0	%	38.0	%	16.8	%	34.8	%

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

	Six Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2022 (adjusted)		June 30,2021		June 30,2021 (adjusted)
Net income as stated	64,396		64,396		131,442		131,442
Amortization of acquired intangible assets	6,550		6,550		2,200		2,200
Income tax impact of the above item	(1,736	)	(1,736	)	(583	)	(583	)
Net income before amortization of acquired intangible assets, net of income tax	69,210		69,210		133,059		133,059
Impact of adjusting items1
Operating expenses before depreciation and amortization
Corporate development costs	-		2,314		-		-
Integration costs	-		789		-		648
Transaction costs	-		-		-		7,359
Day one loan loss provision on the acquired loans	-		-		-		14,252
Other loss (income)	-		24,344		-		(83,286	)
Finance costs
Transaction costs	-		-		-		1,726
Total pre-tax impact of adjusting items	-		27,447		-		(59,301	)
Income tax impact of above adjusting items	-		(4,048	)	-		6,608
After-tax impact of adjusting items	-		23,399		-		(52,693	)
Adjusted net income	69,210		92,609		133,059		80,366
Multiplied by number of periods in a year	X 4/2		X 4/2		X 4/2		X 4/2
Average shareholders’ equity	769,902		769,902		580,856		580,856
Average goodwill	(180,923	)	(180,923	)	(74,152	)	(74,152	)
Average acquired intangible assets2	(118,992	)	(118,992	)	(42,939	)	(42,939	)
Average related deferred tax liabilities	31,533		31,533		11,380		11,380
Divided by average tangible common equity	501,520		501,520		475,145		475,145
Return on tangible common equity	27.6	%	36.9	%	56.0	%	33.8	%

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

easyhome Financial Revenueeasyhome 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 June 30, 2022 and 2021 include those indicated in the chart below:

($ in 000’s)	Three Months Ended
	June 30,2022		June 30,2021
Total company revenue	251,652		202,356
Less: easyfinancial revenue	(214,114	)	(164,888	)
Less: leasing revenue	(27,641	)	(30,123	)
easyhome financial revenue	9,897		7,345

Total Yield on Consumer Loans as a Percentage of Average Gross Consumer Loans ReceivableTotal 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 26 of the Company’s MD&A for the three and six-month periods ended June 30, 2022. Items used to calculate total yield on consumer loans as a percentage of average gross consumer loans receivable for the three and six-month periods ended June 30, 2022 and 2021 include those indicated in the chart below:

	Three Months Ended				Six Months Ended
($in 000’s except percentages)	June 30,2022		June 30,2021		June 30,2022		June 30,2021
Total Company revenue	251,652		202,356		483,794		372,530
Less: Leasing revenue	(27,641	)	(30,123	)	(56,207	)	(60,366	)
Financial revenue	224,011		172,233		427,587		312,164
Multiplied by number of periods in a year	X 4		X 4		X 4/2		X 4/2
Divided by average gross consumer loans receivable	2,295,232		1,611,479		2,198,495		1,438,099
Total yield on consumer loans as a percentage of average gross consumer loans receivable (annualized)	39.0	%	42.8	%	38.9	%	43.4	%

Net Debt to Net CapitalizationNet debt to net capitalization is a capital management measure. Refer to “Financial Condition” section on page 47 of the Company’s MD&A for the three and six-month periods ended June 30, 2022.

Average Loan Book Per BranchAverage 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 RateWeighted 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.

Same Store Revenue GrowthSame store revenue growth (easyhome) and same store revenue growth (overall) are supplementary financial measures. Refer to “Key Performance Indicators and Non-IFRS Measures” section on page 37 of the Company’s MD&A for the three and six-month periods ended June 30, 2022.

Potential Monthly Leasing RevenuePotential monthly leasing revenue is a supplementary financial measure. Refer to “Portfolio Analysis” section on page 26 of the Company’s MD&A for the three and six-month periods ended June 30, 2022.