World Acceptance Corporation Q3 2009 Earnings Call Transcript

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2009-01-28 12:29:10.0

Tags: Advertisement, Call Transcript, Earnings, Operational Accounting, Finance, Seeking Alpha, World Acceptance Corp.

Question-and-Answer Session

Operator

Thank you, sir. (Operator instructions). We'll go first to David Burtzlaff with Stephens Inc.

David Burtzlaff - Stephens Inc.

Hi, Sandy, guys, congratulations on a great quarter, just a few questions here. Where are the unusual items? Where do they show up in the income statement?

Sandy McLean

On the revenue.

David Burtzlaff -Stephens Inc.

On the revenue? All of them are in there?

Sandy McLean

That’s correct.

David Burtzlaff -Stephens Inc.

Okay, all right. Then on the – I noticed the advertising expense was much lower than I thought it would be for the quarter and also much lower than last year. I mean was there a reason why you're not advertising as much. Is it just the environment?

Sandy McLean

No, we made a decision to improve our advertising and marketing department. And we hired an individual to come in and help us with that last May. She has helped us to send out pre-approved mail and shown us that it can be done with a higher response rate by sending less pieces out.

So it’s a direct result so, of course, the average cost per piece is up substantial – I mean quite a bit but when you reduce the number of pieces that you send out, that’s where that saving has been generated.

David Burtzlaff - Stephens Inc.

Okay. And then also on the personnel line, it didn’t seem to increase as much as it has you know in previous third quarters. What did you do kind of differently there?

Sandy McLean

Well, one part of it is the – once the gas prices increased substantially in early of the year, we made a decision to do away with an overall automobile allowance at the branch manager and assistant manager level. We put it in on a direct reimbursement basis based on the number of miles driven.

And that shifted a certain amount of that expense from the personnel line down into other G&A expenses.

David Burtzlaff -Stephens Inc.

Okay.

Sandy McLean

Another part of that is given the performance and everything of the branches this year because of some of the difficult circumstances, our bonuses have been a little bit less than they had in prior years.

David Burtzlaff -Stephens Inc.

Okay. Thank you very much.

Sandy McLean

Okay.

Operator

We go next to Henry Coffey with Sterne Agee.

Henry Coffey - Sterne, Agee, & Leach

 

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