SOUTHFIELD, Mich. -

Credit Acceptance Corp. recently reported more than just its second-quarter performance. The company also received a civil investigative demand from the Federal Trade Commission.

As a part of its Q2 financial reporting to the Securities and Exchange Commission, Credit Acceptance said in its filing that the CID came from the FTC on June 6 relating to its various practices regarding consumers.

Credit Acceptance senior vice president and treasurer Doug Busk told investment analysts during a conference call that the company is cooperating with the inquiry.

“Relative to the contents of the civil investigative demand, it requested information on a number of topics: credit reporting, consumer privacy and information security, customer payments, marketing, training, customer communications, and consumer complaints,” Busk said.

“In terms of timing, really we don't have any insight there. We provide information, and the next step and the timing of the next step isn't known,” he continued.

The FTC’s request arrived as Credit Acceptance was in the closing weeks of a quarter when both its consolidated net income and adjusted net income increased year-over-year.

The company’s Q2 consolidated net income rose to $69.4 million, or $3.06 per diluted share compared to $61.5 million, or $2.56 per diluted share, in the year-ago quarter.

For the six-month span that ended June 30, Credit Acceptance generated $119.2 million, or $5.15 per diluted share, in consolidated net income, a total slightly lower than the same time frame in 2013 when the amount was $122.1 million, or $5.04 per diluted share.

Credit Acceptance’s second-quarter adjusted net income came in at $67.6 million, or $2.98 per diluted share, compared to $60.7 million, or $2.53 per diluted share, for the same period last year.

Through half of 2014, the company posted $131.0 million in adjusted net income, or $5.66 per diluted share. That’s higher than a year ago when Credit Acceptance had adjusted net income of $119.5 million, or $4.93 per diluted share.

Q2 Originations and Competition

Credit Acceptance’s string of double-digit growth year-over-year in loan unit volume and dollar volume stopped in the second quarter after reaching three quarters in a row. The company still posted unit- and dollar-volume jumps of 4.5 percent and 5.7 percent, respectively, during Q2 as its number of active dealers grew 10.6 percent.

The company originated 50,913 contracts in Q2 from a dealer base that consisted of 4,960 stores.

Credit Acceptance chief executive officer Brett Roberts acknowledged average volume per active dealer declined 5.5 percent year-over-year in Q2. Roberts attributed the decline in volume per dealer as the result of increased competition.

”It continues to be a difficult competitive environment,” Roberts said. “The growth rate in the second quarter did break the trend that we saw over the last three quarters. I don't know if the comparison is a little bit tougher this quarter. Last year's first quarter was pretty soft, so the first quarter of this year's growth number likely reflected that. The comparison was a little bit tougher. But it continues to be a very tough market, and the 4.5 percent growth that we had this time was certainly a break in the trend line.”

Analysts asked Roberts if Credit Acceptance is poised to return to year-over-year loan unit increases ranging from 11.0 percent to 14.3 percent as well as dollar volume rises climbing between 11.3 percent and 16.2 percent — the upward levels the company posted in the previous three quarters.

“It will get better at some point but it goes in cycles,” Roberts said. “It's probably likely to get worse before it gets better. That has been the history. It is difficult to know the exact timing, but we're in a period now where there's lots of capital and there’s lots of competition, and there’s certainly loans that are being written that we wouldn't want to write based on the economics of those loans, and so we just have to be patient until the tides turn, which they eventually will.”