America’s Car-Mart not only shared athe financial results from the third quarter of its 2015 fiscal year, but the buy-here, pay-here dealership chain also offered an update on two significant operational changes the company is in the process of finalizing.

During his prepared remarks when Car-Mart hosted its Q3 conference call, president and chief executive officer William Henderson recapped that he previously informed investment analysts about how the company was building a completely new operational software system. Henderson pointed out that new system handles all of the company’s inventory management, sales quotes, credit information, sales documents, payments, customer information and reports as well as collections.

“I probably made the mistake of telling you about that about a year or two early as we had apparently imagined the magnitude of the project to be only about half of what it really was because it ended up taking as twice as long and costing twice as much as originally planned,” Henderson said.

“Despite that we underestimated the time and dollars required, it is an excellent product that is going to be tremendously beneficial for our company,” he continued. “That doesn’t make up for all that to goes into converting to a new system any easier. A lot of people have put an incredible amount of time and effort to make this happen and doing all that in addition to their normal responsibilities and it has been quite a stress test as a team.

“There have been more than a few days around here, and we think we’ve all have gotten on each other’s last nerve. The question was whether or not this was really ever going to come to pass but it has,” Henderson went on to say.

The Car-Mart boss indicated at the time of the call that about 70 of the 138 dealerships in the company network now are using this new system with expectations for the roll out to finish by the end of March.

“Operating on two different systems does create a lot of extra work for several people here, so we will definitely have calls for celebration when we get this project completed,” Henderson said.

Henderson went on to credit the Car-Mart staff members who took the lead on this operational system project.

“I do want to express our great appreciation to those individuals who have seen this project through and recognized the extra mile they have gone in making this happen. There have been many long nights and weekends put in. And as for some, this was a lot of work again above and beyond the already full load of responsibilities,” he said.

“In addition to the software conversion, we’ve been implementing our new compliance management system. And as you can imagine, that involves numerous policy updates for business to manuals and a tremendous amount of training and retraining,” Henderson continued.

“Any of these projects can be trying by themselves,” he went on to say. “But through it all, we’ve continued to not only improve the functions of our business, but to actually improve our business itself, and it takes quite a team to pull that all and we do indeed have an impressive team of dedicated, very intense people around here and we are very, very fortunate.”

Along with all of system updates, Henderson also responded to inquiries about Car-Mart’s leveraging of GPS devices on inventory. He indicated that about 80 percent of Car-Mart’s inventory now is equipped with these units. The company expect to have close to 100 percent of the vehicles on its lots have a GPS device installed within the next six months.

Henderson didn’t have any specific figures to share about the impact Car-Mart is seeing with the use of GPS devices, but he did express a positive assessment of what the company is experiencing.

“We are seeing some real efficiency gains from the use of the product, and we feel like credit losses over the last year would certainly have been a little higher without the product,” Henderson said.

“We are not seeing any real direct savings at this point. But from an efficiency standpoint, and also from the company’s ability to just find collateral when we need to, especially in this regulatory oriented environment, it’s certainly something that we had to do and we are glad we did,” he continued.

“We do expect more benefits down the road as the product gets fully rolled out,” Henderson went on to say. “We will learn how to use it a little better. So it has certainly been a positive, but it’s more been from an operational efficiency standpoint to this point.”

Q3 Performance Update

Car-Mart posted performance increases in several crucial areas, including net income, revenue and retail sales.

“Our plan of focusing on solid top line growth is working out very well, and we are excited about our prospects as we look forward,” Henderson said. “Retail units sold was up 7.1 percent, and same store revenue was up 2.8 percent when compared to the third quarter of fiscal 2014.

“Productivity as reflected in the average retail units sold per month per store increased from 27.7 to 28.0 for the quarter,” he continued. “We feel very comfortable with our new store opening plans and with our ability to grow profitably into the future.

“Our decision a few years ago to continue to grow the business in a smart manner in the face of increased competitive pressures is certainly proving to be the right choice, and we are happy that so many more deserving customers will have the opportunity to succeed with Car-Mart,” Henderson went on to say.

As mentioned, Car-Mart now operates 138 dealerships in 10 states, an increase of eight locations from a year earlier. The company has opened four dealerships so far during its fiscal year, and four more stores are expected to come on board by the close of April. Those new openings are planned in the Georgia cities of Carrolton and Valdosta along with Rolla, Mo., and Glasgow, Ky.

“We are looking to pick up the pace of new lot openings a little in 2016,”

Henderson said. “Again, we are pleased with the top line growth, and we remain convinced that we are moving the company in the right direction.”

Car-Mart chief financial officer Jeff Williams highlighted that during the third quarter, the company saw the continuation of recent positive trends with collections, average down-payments and accounts more than 30 days past due.

Williams added that a reduction in net charge-off s is another metric company managers were “very happy to finally see.”

He continued by saying, “While net charge-off s are higher than historical levels and much higher than we would like to see, we are encouraged by the decrease for the quarter. As always, we will be working hard to help our customers succeed, and their improved success rates will result in lower charge-off levels for us.

“Our mission is to earn repeat business, and we can only do that if our customers are successful,” Williams went on to say. “While the competitive environment remains challenging, our sense is that financing offerings in our markets may be a little more rational now when compared to say 12 months ago.

“We are hopeful that we can get back to a point where customers in the markets we serve are presented competitive financing options that are in their best long term interest, structured for their ultimate success,” he added. “A customer focused operating environment will serve to set Car-Mart even further apart from the competition. We help our customers succeed.”

Williams described Car-Mart’s Q3 balance sheet as “conservative” since its debt to- equity ratio is 49.8 percent, and its debt-to- finance receivables ratio is 26.5 percent.

“With our improved underwriting and credit metrics and the increases we have seen with the top line, we are carrying additional inventory into the critical selling season this year so that we are in a position to attract more customers to the benefits of dealing with Car-Mart,” he said.

The company repurchased 66,467 shares of common stock during the third quarter for $3.4 million at an average cost per share of $50.43. Since Feb, 1, 2010, Car-Mart has repurchased 3.5 million shares, or 30 percent the company, for $114.3 million at an average cost per share of $32.28.

“We believe in the long-term value of the company and plan to invest in the repurchase program when favorable conditions are present,” Williams said. “Our first priority for capital allocation, however, will continue to be to support the healthy growth of the business.

“We remain dedicated to adhering to the thirty-three year Car-Mart tradition of ‘watching every dime’ and being the lowest cost provider on both the financing side of the business and the dealership side,” he added.