Good morning everyone. Thank you for holding and welcome to America’s Car-Mart Second Quarter 2015 Conference Call. The topic of this call will be earnings and operating results for the Company’s fiscal second quarter 2015. 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 at www.car-mart.com. 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 estimates, nor does it undertake any obligation to update such forward-looking statements. For more information regarding forward-looking information, please see Item 1 of Part 1 of the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2014 and its current and quarterly reports furnished to or filed with the Securities and Exchange Commission on Forms 8-K and 10-Q. Participating on the call this morning are Hank Henderson, the Company’s Chief Executive Officer and President; Jeff Williams, Chief Financial Officer. And now, I would like to turn the call over to the Company’s Chief Executive Officer, Hank Henderson.

Well good morning, everyone, we appreciate you joining us today. It is amazing what a difference selling just two more cars makes. With 136 stores now in operation, two more sales per month per lot makes a big difference. The increase added up to almost 1,500 additional sales over the same time last year, putting us at a revenue increase of over $12 million for this quarter over last year. Obviously we’re very pleased with the growth in sales, but what makes it even all the more satisfying is that we did so while actually decreasing our average retail sales price. Affordability is what our customers need and we are getting rewarded by doing a better job of providing that to them. In our past several calls we've talked about the increased competition through the increased availability of financing and we would like to stop talking about it, but it is still there, it hasn't gone away. However, by returning more to our roots and focusing on what we can do better than anyone we’re able to offer to our customers not only immediate financing, but a selection of lower priced and affordable vehicles that better fits their budget and it could be paid off in a more reasonable timeframe than what is offered by some of the more aggressive financing that is out there now. I might also note that we do so with a lower interest rate for our customer than we’re seeing. Our face-to-face relationship with our customers gives us an invaluable competitive edge in both effective collections and also in cultivating repeat business which has forever been the cornerstone of our growth. While we are of course very pleased with our progress in sales, we’re not satisfied with our progress on credit losses. They are flat with the last year and while it may seem tempting to be satisfied with that given the challenges of the past year, we are not. We understand that our customer success is what ultimately guides our own success and we know we can do better. We are seeing some positive indications in our collections. Jeff will give you more detail on that in just a minute, but we haven’t really seen it show up yet through reduced losses and so this is where our focus lies. We recognize that we had to make some adjustments and execute better to get back to where we needed to be on sales and we have done just that. Our task at hand now, is to be the best we’ve ever been at helping our customer succeed. So I’ll go ahead and turn it over to Jeff now for some more detail on our recent results.

Okay. Thank you, Hank. Total revenues for the second quarter was $134 million that’s up 10.2%, same-store revenues were up 5.4% for the quarter and up about 5% from the sequential first quarter. Revenues from stores in the 10 plus year category was up about 3.5%, stores in the five to 10-year category was up around a 11% and revenues for stores and less than five-years of age category was up 40% to about $31 million. The overall average retail units sold per lot per month for the quarter was 29.6, that’s up 7.2% from 27.6 from the second quarter of last year and up 4% from 28.4 sequentially. At quarter end, 41% or 30% of our dealerships were from zero to five-years old, 22% or 16% were from five to 10-years old, with the remaining 73 dealerships being 10-years old or older. Our 10-year plus lots produced 31 units sold per month per lot for the quarter compared to 29.7 for the prior year quarter, that’s 4.4% increase or about 1.3 units per month per dealership and those lots were up from 30.7 sequentially. Our lots in the five to 10-year category produced 29.4 compared to 27.4 that’s 7.3% increase and the lots less than five-years of age had productivity of 27.2 compared to 22.6 for the second quarter of last year that’s a 20% increase. These younger lots were up about 11% sequentially. The improvement in productivity for the younger stores was driven primarily by improved sales execution and another year of seasoning for our dealerships in Alabama, Kentucky and Tennessee. At this point, we’re attributing the top line improvements to overall solid execution and are focused on lot-by-lot productivity results and also we maybe seeing some indirect benefits of lower gasoline prices. Competition is still very intense…

All right, thanks Jeff. Well so all-in-all it was a very good second quarter and it was a continuation of the improving results we had from our first quarter. So sitting here now at the halfway point for a year, we are back on track to have an excellent year and that is a good place to be. However, our primary focus doesn’t lie on the immediate quarter or just these next six-months, we feel confident we have the right people in processes for that. We’ve been in this business long enough and been building this company long enough to know very well that we need to be looking out over the longer term asking ourselves what we must be doing today to assure we’re prepared to effectively service our customers when we’ve 200 stores, which won’t be too many years away. Just having a good quarter or two is not what creates more opportunity in the future for our associates. It’s by growing it the right way for the long-term assuring that we will always be the solid successful company that we are. I can’t say enough good things about the work our expansion team is doing our new locations are looking better than ever. And they’re bringing them in below our projected budgeted amounts. So hats off to Ted Taylor and his team. We do have a lot of work presently underway in several areas to assure we’re equipped to handle our future growth. We’ve made substantial investments in our operational software and our IT infrastructure over the course of past couple of years to improve efficiencies in sales and collections for better customer service and also to assure the best possible support for all aspects of our compliance management systems. Of course the most important aspect of preparing for future growth is preparing future managers and we presently have 18 future managers in training along with several Assistant Managers in place who have their site set on managing their own stores some day. Our training team is doing an excellent job providing the basic training and certification and we have a group of very tenured general managers who are mentoring these future managers in training, imparting their experience to help them be as prepared as possible, for the day they get their own store. So that concludes our prepared remarks, so now we would like to move on to any questions you may have. Operator.

[Operator Instructions] Our first question comes from the line of J.R. Bizzell with Stephens. Your line is open.

Yes, thanks guys for taking my question. Congrats on another great quarter.

Thank you.

My question I would like to ask is kind of, Hank, if you will, the sales cadence during the quarter, given we saw nice acceleration in the cars sold per lot per month, I am just wondering if that was kind of an even growth throughout the quarter or you saw it kind of back end loaded/front end loaded. Just some color around that, if you will.

You know, during Jeff’s comments he mentioned that we are attributing our improved sales to better execution at the lot level. I will tell you that there have been times in years past where we’ve had some stores really blowing it out while others not performing as well, but that’s not been the case. Here recently we've really had solid sales across the board and I would have to say I think it’s been just about as consistent as it’s ever been and not particularly weighted one direction or the other so and that gives us an extra layer of confidence to know that we’re doing sales the right way when they are not all compacted. So I think we are very solid.

Yes, we had all three months in the quarter were solid too; so it was a good quarter all the way around.

Okay, great, thanks for the color. And then kind of building on that, Hank, I know you're talking about kind of leveraging that middle management. I'm just wondering, how early in the process do you think you are? Is it something that you think you are done implementing it and now it is just a matter of it seasoning across the portfolio? Or how should we think about that? And kind of what have you been focusing on with that middle management to focus on at the lower-level, if you will?

Actually that’s an excellent question; well we’ve been working on it for about 30-years, trying to figure it out to tell you the truth, but really I would say in the course of the past two years we've reached the size where more and more it becomes more evident that how important and such a key role that middle layer is and I would say our emphasis to that group has really been solid performance at each location. We are not looking for one sort of pick up sales where another one maybe light, but that we get solid performance from each and I know that may seem very, very simple, but it has been our focus. We’re not focused on just okay, here is the big number we want to hit as a company, but it’s a little more granular, we're really focused on each store carrying their weight and I think that has a lot to do with the better results we’ve had in the past couple of quarters.

And then last one from me, kind of switching gears now. You talked about recoveries and just wondering if you could kind of talk to us about residual values, what you are seeing out there. And then ultimately how you all are thinking about it long-term for your business model?

Yes, certainly, the percentage recovered on a reposition has gone down. This time a few years ago it was in the low-to-mid-30s as a percent and we are in the upper 20s now, so the recovery value certainly are lower which is hurting us on the severity side. We’re trying to do all we can on the collections efforts to make these transactions affordable and to provide really good service to those customers after the sales. So that we have fewer losses which we’ve had some good success there, but we are not expecting any big improvements on wholesale values going forward and not any significant reductions either, since our car is of a lower price there is only so far it goes down in value. So we feel like we’re fairly settled in on that recovery value, but it is several points lower than it was a few years ago and it’s probably causing us $140 per loss in reduced values on the wholesale side.

And then when purchasing those cars I’m guessing are you starting to see prices come down or are you starting to get a higher quality car for a better price point? I mean or is that something that we should think about maybe next year?

I think that certainly it’s helping us on that side, on the sales side prices and availability have been good and we do expect that to continue to be a benefit for us as we look out into the future.

All right, guys. Great, thanks.

Thank you.

Our next question comes from the line of Elizabeth Suzuki with Bank of America Merrill Lynch. Your line is open.

Good morning. Just a question regarding the average age and how that’s been trending on the vehicles you are selling. I guess in the press release you mentioned that you got a better assortment of lower price vehicles, so are those lower price vehicles just older or is the pricing of your core six-year to 12-year old category just coming down in the market?

Well you know the average age of the vehicle we're selling has certainly drifted up over the last few years and the mileage on those cars has also come up some, but each year that goes by the quality of the car from 10-years ago also improves, so we're not seeing any big negatives on the repair side from selling a little older car with more miles on it, but the lower priced cars we're selling it’s more of a basic transportation whereas some of the higher priced cars might be more of a SUV or truck category. So we're pretty happy with the quality of what we're putting out there as evidenced by our lower repair expenses and just feel like we've maybe missed the market a little bit in the last few years on some of those lower price points for customers really just looking for good basic affordable transportation with a lower payment.

Okay, great. And can you just talk about how Car-Mart has been responding to competition on the lending side and were there - were sequentially more favorable terms partly responsible for the improving comps or is that really just store level execution?

First of all I would have to say we think the lion’s share of it is certainly in better execution, but actually the point that we were just talking about with more of offering of affordable cars the lower-end that had definitely picked up some sales, it’s what people need, the financing is certainly available, but affordability is not necessarily all available everywhere, and if you really look across our mix we've actually sold a handful more of the higher-end. We sold several more at our lower-end and a little bit less with what would typically be our middle mix and so I guess to say that I think we just had a little bit broader offering, but certainly what we are seeing that people want are those that are more affordable that they can get paid off more quickly than signing up for some of the long-term offerings that are out there with some of this other financing.

Okay, great. And just one last one. Have you noticed any real change in the competitive environment just from the last quarter? Are there any dealers and lenders that are getting more aggressive then you had seen in the course of the first quarter?

I wouldn’t say that we’ve seen any dealers getting more, less aggressive, I wouldn’t say any change there, we haven’t seen, we’ve talked about a year or ago so that we’re seeing some drop-offs, we’re experiencing some more losses, because of this additional financing that’s out there and that has subsided quite a bit. So my guess is that a lot of people who wanted to run out and when this financing came available, a lot of people who wanted to have now signed up, keep in mind, we are in small towns. And so I think that some of that’s kind of sold ahead of itself. So that has less - that…

Okay, that’s very helpful. Thanks.

Thank you.

Our next question comes from the line of John Hecht with Jefferies. Your line is open.

Thanks very much, guys, and congrats on a good quarter.

Thanks John.

First one, just - I guess you answered this to some degree in the last inquiry. But you guys are doing a good job at keeping down your cost of inventory and controlling margins or maintaining good margins in that realm. And I’m wondering, can you tell us how much of that price relief at the inventory level is related to declining values of used cars versus a change in the mileage or age of the cars you are buying versus just improved negotiating power and execution on your side?

Well, I think first and foremost it’s just our choice to buy cheaper cars, that’s what, what people want, more affordable cars. And certainly as we do that we are going to have our average age and mileage is going to be a little higher. And I’m sorry I don’t have an exact number for you, but most of that change is certainly been in our own efforts to offer more affordability. I do think it’s very reasonable to expect over the course of the next few months, because people will start getting their inventory ready for the tax time. We know that’s big sales time and just talking with some of our guys, they’ve already started seeing some of the more ideal vehicles prices going up. So I think what we’ve got ahead of us for a few months is prices are going to go up. And then hopefully that we get past the tax time and out of our fourth quarter and they will flatten back out.

And then I mean is there any notable difference in kind of the mechanical issues you are having in the portfolio as you have gone out a little older in the car with more miles? Or has the quality of vehicle improved to the point where it is not making a difference in that regard?

As Jeff pointed out our cars repairs is actually down, so I think your guys are doing a great job, you certainly do you have to look at more of those cars in term more down, we are selective in what we buy. So it actually is hard to work for our purchasing team out there, they’ve done a good job and I think part of it too when you are buying a car that’s a little older, a little more miles on it, you probably check it out all that much better, you got to be a little bit more worried to make sure you’re getting the good car for our customer. So I think it’s working out well for us.

Okay, great. And then looking at the increase in unit sales at the lot level, pretty big jump. Is there any specific program - I mean you had mentioned execution there, but was there any specific programs or marketing efforts to new or recurring customers? And can you give us a little bit of data was there pickup in the new customers or was it just better retention of recurring customers?

I would say that our sales for repeat business was solid, it stayed about on track as it usually has we are like every other dealer, we always have some sort of sales or special something going on, so I wouldn’t say there was anything as ordinary. I just think we are doing the better job and I would point out without getting into too much detail I had mentioned it before, we’ve gone through a time where we’ve had some manager turnover, I feel like we have done fantastic job there, we’ve brought it way down, so we’ve got more consistency at the stores, we have more consistency with our area manager ranks. And again for us it works out to a couple of more sales per store. So it’s not really radical difference at the lot level, just a little better adds up.

Yes, okay guys. Thanks very much.

Thanks John.

Thank you, John.

Our next question comes from the line of John Rowan with Sidoti & Company. Your line is open.

Good morning guys.

Good morning.

Good morning.

I just want to understand the impact on cash collections, because duration it looks like was up a little bit year-over-year. Charge-offs were roughly flat, just down a hair, but your cash collections were actually up quite a bit. Just want to understand how that happens.

Well, John that - for the most part the accounts that are paying us are paying us better then they did, we’ve seen modifications go way down, delinquent accounts are down, the average term is pretty flat, but the average age of the portfolio is up a little bit so each dollar collected goes more to principle and feel like we just had better overall execution on the collection side for those accounts that are paying. And certainly we got some benefit from gasoline price is being down.

Did you change any collection practices within the quarter?

No.

And then can you remind me kind of when you started with the GPS rollout, where we stand on that? And if there was any benefit in the quarter from a credit standpoint?

We started about a year ago with certain lots and we are 76% rolled out at this point, it’s really hard to quantify benefits from the product on the credit loss side. We know for a fact that the efficiencies we gain from the use of the product as we grow from an operational standpoint it’s something that we just had to do is an infrastructure investment to support the efficiencies of dealing with 65,000 accounts or 100,000 accounts, it is a product that we had rollout. But as far as seeing any credit loss benefits at this point we can’t say that we have. The whole goal is to be able to deal with the delinquent accounts much sooner when they become to delinquent and save those accounts and get those customers back on track, but the charge-offs are still higher than we’d like they have flattened out but they are still much higher than they were few years ago. So I guess we could say that maybe without the product charge-offs would be even higher, but at this point we are not seeing any benefit that related to historical charge-off levels but we do know we are getting some good efficiencies out of it. And we help as we continue to work on better utilizing the products that may be we will see some credit loss reductions in the future.

Okay thank you very much.

Thank you.

[Operator Instructions] Our next question comes from the line of Bill Armstrong with C.L. King & Associates. Your line is open.

Good morning, Hank and Jeff. Nice quarter.

Hey, good morning.

As far as vehicle condition and charge-offs, so you've had rising charge-off rates over the last couple of years and concurrent with that you've also had higher mileage and somewhat older cars. So has - are the percentage of loan defaults that were caused by or triggered by mechanical breakdown, has that been increasing during that time as well?

No.

No, not. I think the quality of a car, each year that rose by as we mentioned earlier the quality of a 10-year old car is pretty high, there is a lot of life left in the car we're putting out there and each year that rose by the quality from 10-years ago goes out so, and again we've seen some nice results on repair type expenses. So we've not seen any negatives on that side from that more affordable car.

And you know I would just emphasize again, really we have to really give a lot of credit to our guys that are out there buying the cars, because you do have to be more selective with those and I think that’s exactly what we've done, we've been more selective where we buy in that range and its working out for our customers.

Got it, okay. And your collection rate was up; you mentioned modifications were way down. Is that a result of more intensive collection efforts or are you seeing maybe perhaps a better quality, credit quality of customer coming in? Or maybe there was an improving job market, lower gas prices, maybe customers are just able to -- better able to make their payments. What do you think is driving that?

I think you named it all. I think its all of those things have an impact, it’s hard for us to discern exactly from store-to-store which has the greatest impact, but ultimately what it means for us is the accounts are more solid in the delinquencies numbers that we have are very accurate. So that then is just set off in there, so we feel really good about our accounts.

Okay. And then last question on gross margin, just under 43%, that is the best quarterly margin you have had in a few years. And you kind of mentioned some of the reasons. Do think that is sustainable, that 43% range? Because you have been in kind of the 41%, 42% range for the last few years. Do you think 43% is something that is sustainable going forward?

It’s a little hard to say, it was a good quarter and we did receive nice bump from just the volume increase, but certainly something above 42% is maybe - we've been saying 42% for some time now, but maybe it’s slightly above that. Hate to commit to much more than that at this point, but because some of the good results this quarter did relate to the significant increase in volume and the relative reduction in wholesale sales, but we did had some nice results on the repair side again that we hope continue, but we would love to say its going to be closer to 43%, its just maybe a little too early to say that.

Okay. And then actually that brings up just one last question, sorry to keep going on. But on the higher volume, was that a function of more traffic coming through your stores or better conversion rates of converting the customers who did walk into your stores into buyers.

I think going back, I think we're doing a better job at the store level with the whole process of the wholesales process and I think we certainly for this past quarter we had a better supply, better stock of the lower price cars and that certainly made a difference, but I really primarily attribute the increase to our folks just doing a better job.

Okay, great. Thank you very much.

And I’m not showing any further questions in the queue at this time. I would like to turn the call back over to management for closing remarks. End of Q&A:

Okay, well again thank you all for joining us today, we're proud of what we've had so far this year, but we're going to get back to it and look for good things in the future. So thank you all and have a great day.

Ladies and gentlemen, thank you for participating in today’s conference. This does conclude the program. And you may all disconnect. Everyone have a good day.