Good morning, everyone. Thank you for holding, and welcome to America's Car-Mart Fourth Quarter Fiscal 2021 Conference Call. Topic of this call will be the earnings and operating results for the company's fourth quarter and full fiscal year 2021. Before we begin, I would like to remind everyone that this call is being recorded and will be available for replay for the next 30 days. The dial-in number and access information are included in last night's press release which can be found on America's Car-Mart's website. As you all know, some of management's comments today may include forward-looking statements, which inherently involve risks and uncertainties that could cause actual results to differ materially from management's present view. These statements are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. The company cannot guarantee the accuracy of any forecast or estimate nor does it undertake any obligation to update such forward-looking statements. For more information regarding forward-looking information, please see Part 1 of the company's Annual Report on Form 10-K for the fiscal year ended April 30, 2020 and its current and quarterly reports furnished to or filed with the Securities Exchange Commission on Forms 8-K and 10-Q. Participating on the call this morning are Jeff Williams, the company's President and Chief Executive Officer; and Vickie Judy, Chief Financial Officer. And now, I'd like to turn the call over to the company's Chief Executive Officer, Jeff Williams.

Okay, well, thank you for joining us this morning. We are proud of our work and we're pleased to see the continuing benefits from our various investments and initiatives which are aimed at allowing us to leverage, scale and grow the business by improving the customer experience journey. There are many touch points and opportunities to exceed customer expectations in our business and we believe that no other company can keep customers on the road and reduce the stress related to local transportation needs like America's Car-Mart can, and we will only get better over time. Our ground level local personalized offering combined with our technology and scale give us unique advantages in our market. We will continue to look to centralize non-core field functions that could be performed more efficiently with corporate support without losing the benefits of our decentralized decision-making at ground level and close to the customer. This will allow our associates in the field to focus on service and growing the number of customers we serve. Our investments in the areas of customer experience, recruiting, training, and retention, inventory procurement and management are allowing us the ability to grow market share and move from a collections company to a sales company that's very good at collections. We're making good progress in all areas and our efforts in the technology area will continue to give us additional opportunities to utilize data to our advantage and we have a very high expectation for our consumer-facing digital experiences as we move forward. Our community-based bricks and mortar presence combined with our digital opportunities give our model real strength. We will continue to invest in our business to allow us to be the market leader over the long-term. Our corporate customer experience team is making great progress and is directly involved with our consumers and working with our dealership personnel to ensure our customers have consistently great experiences. We will continue to look at the industry partnerships which are becoming a bigger part of our overall efforts. Our current profits are strong and we have an obligation to reinvest these current profits for our future. Customers need what we do and we have an obligation to serve more customers over time. Our new service contracts are rolling out company-wide and the customer response has been very positive and very strong. Our associates are proud to be offering these new products that include extended terms, roadside assistance and oil changes, all-in keeping you on the road pledge. We're making great progress with our inventory management efforts and we're optimistic that we will continue to see significant benefits from this area of the business. We've put together a strong team to lead our inventory transformation. Again, industry partnerships are playing a key role in our progress. We're very proud of our company and the hard work and dedication of our associates. This last fiscal year, which started on May 1, 2020 was extremely difficult, but our associates continued to rise to the occasion working many hours under very difficult and uncertain conditions never wavering in their efforts to support each other, our customers and our communities. We show the resourcefulness, creativity and how nimble our business can be because of the quality of our associates that we have in place and their dedication to our purpose. Now, I will turn it over to Vickie to go over some numbers. Vickie?

Hello and good morning. Our total revenue increased 42.6%, up to $279 million resulting from a 24.3% increase in retail units sold, a 15.9% increase in average retail sales price and interest income increased by 28.1%. Our same-store revenues were up 37.6%. Revenues from stores in the over 10 years of age category were up 41%, stores in the five- to 10-year category were up 48% and revenues for stores in the less than five years of age category was up to about $15 million. Our associates across the company worked tirelessly this past year and throughout the fourth quarter to serve our customers with exceptional service which translated into productivity improvements of an average of 36.5 units sold per store per month. This was also possible due to the investments in our inventory and our procurement processes, including our preferred vendor partner relationships. Our retail inventory was up due to higher quantities and combined with higher pricing. As a reminder, the inventory levels at April 30, 2020 were low due to the pandemic environment. At quarter end, 16 or 11% of our dealerships were from zero to five years old, 39 or 26% were from five to 10 years old and the remaining 96 were 10 years old or older. Our overall productivity was 36.5 units sold per store per month compared to 30.2 for the prior year quarter and 31.1 for the sequential quarter. Our 10-year plus lots produced 38.1 units sold per month per lot for the quarter compared to 30.5 for the prior year quarter. Lots in the five to 10-year category produced 34.4 compared to 27.4 for the prior year quarter. And the lots less than five years of age had productivity of 32.3 compared to 23.5 for the fourth quarter of last year. Our down payment percentage was 8.7% compared to 7.8% for the prior year quarter. Collections as a percentage of average finance receivables were at 14.9% compared to 15% for the prior year quarter. Collection percentages were positively impacted by tax time refunds, stimulus payments and the CARES Act unemployment benefits. The average originating contract term was 37.1 months compared to 31.8 for the prior year quarter and up from 35 months sequentially. The average selling price was up 15.9% or $1,979 with the 5.3 month increase in the term compared to the prior year fourth quarter. These term increases are necessary to ensure affordability for our customers as the retail sales price increases. The quality of the vehicle in terms of age and mileage continues to improve as well. We will continue to be mindful of balancing this term length with affordability, but believe we are putting a better customer and higher quality vehicle for the most successful outcomes. Our weighted average contract term for the entire portfolio including modifications was 37.3 months compared to 33.3 for the prior year quarter and the weighted average age of the portfolio decreased slightly from approximately 8.8 months to 8.2 months. Interest income increased $6.7 million or 28.1% compared to the prior year quarter, primarily due to the $158 million increase in average finance receivables at a 25.6% increase. The weighted average interest rate for all finance receivables at the end of the quarter was approximately 16.5%, relatively flat from the prior year quarter. Gross profit per retail unit also increased by $800 to $6,032, this was a 15.3% increase compared to the prior year fourth quarter. The gross profit percentage was 40.2% compared to 40.5% for the prior year quarter and down from the sequential quarter at 40.6%. The reduction in gross profit resulted from the lower margin on the retail unit partially offset by improved wholesale margins due to the strong demand in the used car market and also lower repair costs. The increasing average selling prices results in lower gross margin percentages, but higher gross margin dollars per unit as our gross margin percentages are lower at higher selling prices. The mix of the type of vehicles sold had increases in car and SUV sales over the prior quarter and pickup sales decreasing due to the high price and tight supply of trucks. Our SG&A for the quarter was up $5.7 million compared to the prior year quarter, but down as a percentage of sales to 14.5% compared to 17.7% for the prior year quarter. SG&A as a percentage of total revenues less cost of sales and provision for credit losses was 45.6% compared to 54.6% for the prior year quarter excluding the impact of the allowance changes. This metric is important for our integrated sales and finance business as a large part of our efforts are focused on keeping customers on the road. Our investments continue to be primarily payroll-focused as we build our customer experience team, invest in our procurement team and combined with increased commissions because of the higher net income. Our new customer relationship module of our ERP system went live in May of '21 and we will continue to invest and improve our technology and digital platforms to enhance the customer experience as we move forward. We'll also be investing in additional marketing as we continue to promote our brand image with our new tag line and our new service contracts. As always, our expectation is that we will continue to leverage these investments with market share growth over the long-term. We are now serving over 7,400 additional customers compared to this time last year at an improved service level. For the current quarter, net charge-offs as a percentage of average finance receivables was 4.8% down from 5.6% in the prior year fourth quarter and down from 6.4% for the quarter ended 4/30/'19 pre-pandemic. We saw improvements in delinquent accounts and our accounts 30 plus past due was at 2.6% compared to 6.2% for the prior year fourth quarter. The CARES Act enhanced unemployment benefits and stimulus payments certainly contributed to this improvement along with our increased efforts working with our customers to help them through these challenging times. Recovery rates of repossessed units also contributed to the decrease in net charge-offs, recovery rates for the quarter were approximately 28.5% compared to 26.7% in the prior year quarter. As a result of these improved delinquencies, our overall credit loss results and our outlook for projected losses we have lowered our allowance for credit losses from 26.5% to 24.5% as a percentage of finance receivables net of deferred revenue. This decrease in the allowance resulted in a $15.1 million pre-tax decrease and the provision for credit losses. This impact was the diluted earnings per share increase of $1.65, resulting in diluted earnings per share $4.54 excluding the allowance change for the fourth quarter of '21. The effective income tax rate was 21.5% for the fourth quarter of fiscal '21 compared to 15% for the prior year quarter. Income tax expense included an income tax benefit of $729,000 and $160,000 related to share-based compensation for the current quarter and the prior year quarter, respectively. We expect our base effective tax rate to be approximately 24% going forward prior to any excess tax benefits from stock option exercises. At quarter end, our total debt was approximately $226 million, we have $3 million in cash and approximately $99 million in additional availability under our revolving credit facilities. Our current debt net of cash to finance receivables ratio is 27.6% compared to 25.1% at this time last year. This percentage increase relates to the increase in our inventory investment compared to this time last year, an additional $45.8 million. During the fiscal year, we added $188.4 million in receivables. We increased inventory by $45.8 million, repurchased $10.6 million of our common stock and funded $9 million in capital expenditures, a total of $253.8 million with only a $67 million increase in debt net of cash. We are well positioned to serve more customers and grow our market share. Now, I'll turn it back to Jeff.

Okay. Well, thank you, Vickie. As for the inventory, we do expect to see some continuing supply issues and related inflation with inventory. Our team has done a nice job to ensure we have product to meet the increasing consumer demand for our offering. Prices are certainly higher than we would like, but we have been and will continue to be nimble and improve our inventory management processes as we go forward. Overall, our inventory is in very good shape going into the summer months. As for growth, we are pleased with our productivity for the quarter as we move towards serving more customers per dealership. We're looking to pick up market share and grow volumes in an environment without stimulus money. Our primary source of growth over the next few years is productivity improvements from existing dealerships. We ended the year with 583 customers per dealership as our average and as we've stated previously we do believe that a majority of our dealerships can and should be supporting 1,000 or more customers over time. We will also open some new stores and continue to look for acquisition opportunities. Once again, we are very proud of the year but we have a lot of work to do. We believe that we are in the early innings with our key initiatives and priorities and we are pushing hard with a sense of urgency in all areas. The magnitude of the changes that we have been and are making are substantial and as a decentralized company we must always ensure that the rate of change can be digested in the field and we believe we've been able to make these changes and improve the business at the right pace and we do expect the pace to quicken as we go forward. We have great associates at all levels, who recognize the magnitude of the opportunities we have in front of us and they continue to take on more responsibilities and enthusiastically embrace the changes we're making for our future. Thank you, again, and we will now open it up for your questions.

At this time, the participants will now answer questions from the callers. I would like to reiterate that my earlier comments regarding forward-looking statements apply both to the participants' prepared remarks and to anything that may come up during the Q&A. Your first question comes from the line of John Murphy with Bank of America.

Good morning, everybody, and thanks for all the detail here. Jeff, I guess just a first question, can you talk about what the customer-facing digital opportunities are, how you're going after them and what you think the upside over time is? And I think there has been in the retail community a belief that the higher end consumer has a higher propensity to use online tools but it actually seeing sort of like the subprime and lower to mid-consumer is actually where there is a lot more activity, so I'm just curious how you're going after this digital opportunity and what it means for the company?

Yes, John, the online credit application process and the online inventory that we're showing is we're making progress in that area. The loan origination system, we're working on our loan origination system to push more of the transaction online. We do have capabilities of home deliveries and curbside deliveries and we're going to improve those processes as we move forward. A lot of our customers will choose long-term to come into the dealership for some aspect of the transaction. But we feel like the effort we have in place, we're going to be as good as anybody from a digital side of things when we finish our efforts. And when you combine that with the bricks and mortar and a lot of consumers still want to come in and finish that transaction, test drive that car at the dealership, we believe that we're going to see more and more folks starting the transaction online as we go forward and we plan to invest significant time and resources and talent in making sure that our digital presence out there from a consumer standpoint is as good as anything they'll see from any other car dealership. So, we're very excited about the opportunities there, and for us, it's all about making the transaction and the process seamless and intuitive and user-friendly from the consumer standpoint, and our consumer being subprime and deep subprime as you mentioned, they are very savvy and very used to dealing online and we're going to meet those needs for our consumer base, and we will, at the end of the day, we're going to have as good of an online presence and offering as anybody out there.

And John, I might just add to that, with this customer relationship module that we just got implemented in May, there'll be a continued, whether it's pre-sale or post-sale line of communication with the customer the way they want to communicate whether that's calling or going into the dealership, but then they will also have the opportunity to make a phone call to the customer care line here corporately or a text and again that may be post-sale for a repair issue or a question or payment issue or it may be pre-sale regarding the inventory that's online or a question about the type of credit. So I think all of that combined is going to give a much better customer digital experience.

And just a follow-up, I'd imagine it's very early days, but I mean are there any transactions that are going almost completely online and that you have in-home delivery and where do you see that going over time?

It has not been a significant part of our business. We tried some of that during the pandemic, but our customers still need a lot of guidance and prefer to drive the car themselves. However, we will have a system in place to support this area. If home delivery becomes a major requirement, we will be able to accommodate that. If curbside pickup is desired, we will also have that option. There hasn't been substantial demand from our customers for fully online transactions and home delivery yet, but we are working towards that as demand develops, and our customers will be ready for it. At this moment, it has not been a significant aspect of our business.

That's helpful. And then a second question, when you're talking about supporting a thousand or more customers per dealership over time. I mean, that's essentially a doubling from where you are right now or depending on how far this goes maybe even more than that, what are the key drivers of that? I mean, you've shown a propensity to increase productivity over time, but that's a big step. So I mean, what are the key tools to get there and what is a reasonable amount of time? We're talking three years, five years, ten years, I mean, what's the thought process on that target?

Our goal is more mid to long-term. While we don't have a specific timeline, we are dedicated to enhancing the customer experience, boosting repeat business, and ensuring our best customers remain with us. In the past, we have sometimes congratulated customers for improving their credit and watched them leave for other dealerships without realizing we could retain these valuable customers. We can offer them a better vehicle at a more competitive cost, along with excellent post-sale support that surpasses what they find elsewhere. We are committed to fostering lifelong customer relationships, improving our product offerings, and significantly enhancing the customer experience. Car ownership can be stressful in the areas we serve, and we aim to provide customers with peace of mind regarding their vehicles, payments, and maintenance concerns. If we can achieve this at a sensible all-in price, we believe that concentrating on repeat business and enhancing customer experience and vehicle quality will increase the number of customers we can serve per dealership over time. We have a strong balance sheet and the necessary capital to invest in the markets we know well, which is crucial for our profitability, volume, and risk management. We understand these markets, our staff, and our existing customer base, making further investment attractive to us. We believe there are opportunities to increase our customer base, though we do not have a specific timeline for achieving this. Ultimately, we feel that communities are better off when Car-Mart is present and expanding, and we are enthusiastic about the opportunities to leverage our existing structure.

And then just lastly, I mean, you mentioned improving inventory management, but it sounds like that also means, in some cases, increasing the inventory so you can increase sales. So what exactly is going on with inventory management? It's obviously very difficult right now because there's not a lot of flow in the market inventory, if you will, it's tight. What does that mean and where are you going on improving inventory management, what are the key targets we should be thinking of?

We are focusing on expanding our preferred vendor efforts by partnering with skilled long-term wholesalers in our markets. These individuals excel at buying and repairing cars, preparing them for sale. They are eager to collaborate with us and provide a steady supply of high-quality vehicles in suitable geographical locations. Another key area is reconditioning; we are exploring ways to recondition cars within our existing network, turning them into solid retail options for lower price points. Given the current tight supply, it's essential to reevaluate the vehicles we already have. We are also considering reconditioning cars purchased at auctions and looking to acquire vehicles from a broader range of locations across the country. Our 151 general managers play a crucial role in monitoring local supply and identifying opportunities. This unique structure allows us to have an advantage, resulting in increased sales as we head into the summer months while others may struggle with inventory. We are also acquiring more cars from rental chains, which will help us cater to higher-end consumers who want newer vehicles with lower mileage. Overall, we are optimistic about our procurement, logistics, and inventory management strategies, which are still in the early stages but show promising potential for the future.

Jeff, can you clarify if you are expanding your offerings to include lower-end and older vehicles as well as younger vehicles? Is that an accurate assessment of your strategy?

I don't believe we are compromising the middle segment. Our aim is to attract a company that offers a range of price points. So, we are not overlooking the middle; rather, given the current supply challenges and shortage of cars, we are being more innovative on the lower end. We want to ensure we retain our middle segment, and we have been emphasizing our commitment to providing options across all price points for several years. This demonstrates our efforts to ensure that consumers in our markets can come to Car-Mart for any price point, and we have strong offerings in all areas.

Great. Thank you very much.

Thank you.

Your next question comes from the line of Kyle Joseph with Jefferies.

Hey. Good morning Jeff, Vickie, congratulations on a really, really good quarter and year for that matter.

Thank you, Kyle.

Thank you.

Obviously, there is a lot going on in the quarter with tax refunds and stimulus, just wanted to get a sense for how sales trended by month, if you'd just give us a sense, high level doesn't even need to be numbers but how sales have trended in February versus March and into April?

We had three really solid months. I guess it was maybe a little bit more in February but not March this year. Sorry, the tax refunds were a little bit late, some of the stimulus was in March, maybe a little bit more in March but February was strong, we had a nice finish in April. So all in all, it was a good quarter and each month within the quarter was good.

Yes. Everyone knows that used car prices are high, and I recognize that you're offsetting some of that with the term extension. Can you provide insights on how the average monthly payment has been trending over the past year?

Yes. With the increased sales prices and the amount financed, we have noticed a rise in the average payment. We're probably up about $30 to $35 for the year on the average payment overall. We closely monitor the quality of the applicants and the affordability of the transaction, and with the improvements in the quality of the cars we are offering, we are attracting higher quality customers. So affordability remains strong, but with these price increases, we are observing some rises in the monthly payments.

Got it, that makes sense. And then last question from me, good inventory growth year-over-year. I know you talked about that comparing to pandemic levels, can you give us a sense for how much of that is actual units versus price appreciation?

Yes. Looking at the retail side, the units on hand have increased by nearly 50% compared to this time last year. At the end of April this year, we are holding about 50% more units than we did last year. Some of this change was in response to the pandemic, as we had significantly reduced inventory at the end of April 2020, but since then, our units have risen by about 50% from the start of the year.

Got it. Thanks for answering all of my questions. Appreciate it.

Thank you, Kyle.

Your next question comes from the line of Vincent Caintic with Stephens.

Thank you for the opportunity to ask questions. My first question is about productivity per store, which reached 36.5 cars sold per month. While I understand that the fiscal fourth quarter tends to be the strongest, do you consider 36.5 to be a sustainable figure moving forward, or should we adjust our expectations when we plan for fiscal 2022?

Well, our objective is to improve and increase productivity. We don't have a specific number, but we're making a lot of investment and focusing a lot of efforts on moving from a 40-year-old collection company to a sales company that can collect. And so we do expect to continue to bump up productivity and all the efforts and all the investments we're making certainly are in line with that effort. We do expect to leverage these costs, as Vickie mentioned, as we go forward. But we are very focused on improving productivity and growing sales and growing customer accounts over time as we go forward. Don't have a specific number for you.

There definitely would have been some stimulus impact in that. How much of it was stimulus, how much of it was regular tax time, how much of it was due to the improvements that we're making in our business is obviously fuzzy, but definitely a lot of good things just happening in our business for sure.

Right, understood. Yes, I guess, trying to parse out how much of that is your investments, which really sound like they're taking hold and getting traction, so that's great. Thank you.

Vincent, when you think about 36 sales per month per dealership, I think that over time, again we don't have a timeline, but a company that is established as we are and doing the great things that we're doing, we do expect productivity to improve significantly over time. 36 sales per dealership per month is not anything that anyone would consider to be an acceptable long-term sales rate. So there is a lot of productivity out there and the investments we're making should allow us to certainly be more productive as we go forward. 36 sales per month is not very high.

Great, that's very helpful color. Thank you. And that points towards your 1,000 customers per dealerships, really appreciate that. Second question, your performance has been really impressive even as used car prices have been increasing and I usually think about used car prices being higher as sort of a negative for Car-Mart all else being equal, but it's been very positive or you've had really positive results. I'm sort of wondering if we're still in the same environment with higher used car prices and it seems like it's going to be that way through the rest of calendar year 2021, is that something that should we expect kind of the same strong results or does it seem like that might be a drag at some point or is this actually an opportunity or a very opportune environment for you? Thank you.

It's difficult to predict the direction of prices. We don't anticipate prices rising over the next year as they did previously. However, there is a commodity element to our business that requires us to adapt to fluctuations in prices, and we intend to do so. We believe we can be flexible enough to make wise decisions and respond to changing conditions as needed, though we do not expect car prices to decrease; rather, the concern is how much they might increase over the next year and a half. We are focused on ensuring our stability and growth while managing rising inventory costs in the short term. This situation offers advantages, including the high cost of capital and entry into this business, which makes it more expensive to operate with increased car prices. Our strong financial position and low debt enable us to capture market share from competitors who may struggle to take advantage of emerging opportunities. We will remain flexible and responsive to market conditions, focusing on what we can control while actively participating in the commodity aspect of the business to keep our customers satisfied and successful. We have a strong belief in our markets and are committed to fully participating, even though we hope for a stabilization in used car prices, which does not seem imminent.

Okay, great. Yes, it's been very impressive that you've been able to pass along the car prices. I appreciate it. Thanks very much.

Thank you.

Your next question comes from the line of John Rowan with Janney.

Good morning, guys.

Good morning.

Good morning.

Quick question. The gross profit has decreased slightly, could you clarify if that is related to the higher sales price? Is there any connection to the service contracts and whether the expenses associated with them might actually be categorized in a different expense line? That's all from me. Thank you.

No, it would be in that same category. We have not seen really any additional cost per se, if you will, related to the new service contracts yet. We just started rolling those out across most of our states in February and we've been piloting them in a few locations for about a year now. So the cost aspect of the new service contracts is very minimal right now.

But going forward, could it impact gross profit margin next year?

Our expectation is that once the revenue is fully baked in and the costs are fully baked in, then our gross profit on the service contracts will remain the same as it has been historically.

Okay, thank you. That's it from me.

Thank you.

You have no further questions at this time. So I will turn the call back over for any closing remarks.

Okay. Well, once again, thank you for your interest in Americas Car-Mart. Thank you for listening into our call this morning. We appreciate our associates and their dedication to making our company better. We really have been through a pretty tough year from an associate standpoint with the pandemic and social unrest and our group and our team has really stuck together, and we're very proud of what we've done, but we're even more proud of where we're going to go with the company, and very excited about our future and we sure appreciate all of our great associates that are out there taking care of our customers and taking care of each other and making our communities better. So, thank you and have a great day.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating, and you may now disconnect.