Mr. Clive Kinross reports

PROPEL REPORTS RECORD SECOND QUARTER RESULTS AND DECLARES QUARTERLY DIVIDEND

Propel Holdings Inc. has released record financial results for the three months ended June 30, 2023, and has declared a dividend for the third quarter of 2023. All amounts are expressed in U.S. dollars unless otherwise stated.

Financial and operational highlights for second quarter 2023

Comparable metrics relative to Q2 2022 and year-to-date Q2 2022, respectively:

• Revenue: increased by 33 per cent to $71.7-million in Q2 2023 and increased by 31 per cent to $137.3-million for year to date through Q2 2023, representing record performance for both periods;
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization): increased by 114 per cent to $18.2-million in Q2 2023 and increased by 93 per cent to $35.3-million for year to date through Q2 2023, representing record performance for both periods;
• Net income: increased by 183 per cent to $5.7-million in Q2 2023 and increased by 123 per cent to $13.1-million for year to date through Q2 2023, representing record performance for the six-month period;
• Adjusted net income: increased by 102 per cent to $8.6-million in Q2 2023 and increased by 71 per cent to $16.9-million for year to date through Q2 2023, representing record performance for both periods;
• Diluted earnings per share: increased by 174 per cent to 15 cents in Q2 2023 and increased by 116 per cent to 36 cents for year to date through Q2 2023, representing record performance for the six-month period;
• Adjusted diluted EPS: increased by 96 per cent to 23 cents in Q2 2023 and increased by 66 per cent to 46 cents for year to date through Q2 2023, representing record performance for the six-month period;
• Loans and advances receivable: increased by 53 per cent in Q2 2023 to $215.7-million, a record ending balance;
• Ending combined loan and advance balances: increased by 53 per cent in Q2 2023 to $273.2-million, a record ending balance;
• Dividend: paid a Q2 2023 dividend of 10 Canadian cents per share on June 7, 2023, representing a 4.3-per-cent dividend yield against Propel's closing share price on Aug. 10, 2023.

Management commentary

"Propel delivered another outstanding quarter of record results in Q2, including record revenue, adjusted EBITDA, adjusted net income and ending CLAB balance. After experiencing a more typically seasonal first quarter, our business returned to a period of robust originations driven mainly by new customer volume.

"Growth of new customer volume was driven by strong consumer demand, which, coupled with a resilient macroeconomic environment and continued strong credit performance, led to record originations. Critically, Propel achieved these results while we and our bank partners maintained a prudent approach to underwriting. We can facilitate access to credit to more consumers while driving profitably for shareholders because our [artificial intelligence] builds a more accurate prediction of credit performance than credit scores used by traditional lenders. This translated into improved provision for loan losses and other liabilities as a percentage of revenue, which decreased to 51 per cent during the second quarter from a high point of 58 per cent in Q2 2022.

"As we move into the second half of 2023, we expect growth to accelerate as a result of: (1) expanding our established programs by continuing to originate new, high-credit-quality customers for us and our bank partners; (2) scaling Pathward, N.A. and Fora; and (3) realizing additional market opportunities, including new products, partners and geographies. At Propel, we're building a new world of financial opportunity, and we are just getting started," said Clive Kinross, chief executive officer.

Declaration of Q3 2023 dividend

Propel also announced today that its board of directors has declared a dividend of 10 Canadian cents per common share, payable on Sept. 8, 2023, to shareholders of record as of the close of business on Aug. 18, 2023. The company has designated this dividend as an eligible dividend within the meaning of the Income Tax Act (Canada).

Conference call details

The company will be hosting a conference call and webcast tomorrow morning with a presentation by Mr. Kinross, and Sheldon Saidakovsky, chief financial officer.

Conference call details are as follows.

Date:  Friday, Aug. 11, 2023

Time:  8:30 a.m. ET

Toll-free North America:  1-888-886-7786

Local Toronto:  1-416-764-8658

Conference ID:  88200336

A webcast will be available.

Replay:  1-877-674-7070 or 1-416-764-8692 (PIN: 200336 followed by the number sign)

About Propel Holdings Inc.

Propel (Toronto Stock Exchange: PRL) is an innovative financial technology company, committed to credit inclusion by facilitating fair, fast and transparent access to credit through its proprietary, industry-leading on-line lending platform. Understanding the challenge faced by millions of people without adequate access to credit, Propel, through its operating brands, is dedicated to bringing best-in-class credit solutions to consumers in Canada and the United States. For more than a decade, Propel has leveraged its expertise in consumer lending, its robust capabilities in artificial intelligence and underwriting, and its steadfast dedication to a superior customer experience to facilitate over one million loans and lines of credit to consumers in need.

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