Good day and welcome to the Enova International First Quarter 2017 Earnings Conference Call. [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conference over to Monica Gould, Investor Relations for Enova. Please go ahead.

Thank you, Drew, and good afternoon everyone. Enova released results for the first quarter of 2017 ended March 31, 2017 this afternoon after the market closed. If you did not receive a copy of our earnings press release, you may obtain it from the Investor Relations section of our web site at ir.enova.com. With me on today's call are David Fisher, Chief Executive Officer and Steve Cunningham, Chief Financial Officer. This call is being web cast and will be archived on the Investor Relations section of our website. Before I turn the call over to David, I'd like to note that today's discussion will contain forward-looking statements based on the business environment, as we currently see it and as such, does include certain risks and uncertainties. Please refer to our press release and our SEC filings for more information on the specific risk factors that could cause our actual results to differ materially from the projections described in today's discussion. Any forward-looking statements that we make on this call are based on assumptions as of today and we undertake no obligation to update these statements as a result of new information or future events. In addition to U.S. GAAP reporting, we report certain financial measures that do not conform to Generally Accepted Accounting Principles. We believe these non-GAAP measures enhance the understanding of our performance. Reconciliations between these GAAP and non-GAAP measures are included in the tables found in today's press release. As noted in our earnings release, we have posted supplemental financial information on the IR portion of our web site. And with that, I'd like to turn the call over to David.

Thanks Monica. Good afternoon everyone. Thanks for joining our call today. I am going to start by giving a brief overview of the quarter. Then I will update you on our strategy for 2017, and finally, I will share our perspectives looking forward. After my remarks, I will turn the call over to Steve Cunningham, our CFO, to discuss our financial results and guidance in more detail. We are again pleased with the strong performance and profitability of our business. First quarter revenue was in line with our guidance at $192.3 million, an increase of 10% over Q1 of last year. The strong revenue was driven from healthy demand across almost all of our products. Adjusted EBITDA for the quarter, was $43.9 million, up 16% from a year ago and at the high end of our guidance. Net income was 40% from the first quarter of last year, to $13.9 million or $0.41 per share. Both EBITDA and net income once again benefited from our strong revenue, as well as solid credit performance and efficient marketing. Total company-wide originations in Q1 rose only slightly from the first quarter of last year. However, we originated significantly more loans and financings this year, as our origination mix shifted at more smaller short term loans. We saw particular strength in our U.S. subprime and our U.K. subprime products, with a number of new customers in both of those businesses up over 20% year-over-year. Even with the higher new customer volumes, we were able to keep marketing costs low, through efficient marketing. The result was cost per funded loan down double digits year-over-year in both U.S. subprime and U.K. subprime. Our total portfolio grew 90% year-over-year in the first quarter, driven by our installment and our line of credit products. Installment loans and lines…

Thank you, David, and good afternoon everyone. I will start by reviewing our financial and operating performance for the first quarter, and then provide our outlook for the second quarter and full year 2017. We are off to a strong start in 2017. For the first quarter, total revenue and adjusted EBITDA exceeded the midpoint of our guidance. In addition, diluted earnings per share grew 36.7% from the first quarter of 2016. As David mentioned, total revenue was $192.3 million in the first quarter, a 10.1% increase from the year ago quarter. On a constant currency basis, revenue increased 11.9%. Year-over-year revenue growth was driven by growth in total company, combined loans and finance receivable balances, which totaled $621.3 million at the end of the first quarter of 2017. That's up 18.8% from $523 million in the first quarter of last year. Line of credit products and installment loans in receivable purchase agreements products, continue to drive the year-over-year increases in total loans and finance receivable balances. Total company origination dollar volume in the first quarter rose slightly on a year-over-year basis, and was down 12.7% sequentially, reflecting our typical first quarter seasonality. However, as David mentioned in his remarks, the number of loans and financings originated increased 5.6% from the first quarter of 2016, and was the highest number of originations in a first quarter period since 2014, as we saw increased demand for short term loans in both the U.S. and the U.K. Domestically, revenue increased 14.8% on a year-over-year basis and declined 5.3% sequentially to $164.7 million in the first quarter. Domestic revenue accounted for 86% of our total revenue in the first quarter of 2017. Domestic year-over-year revenue growth was driven primarily by a 21.9% increase in domestic line of credit revenue and a 14.4% increase…

Great. Thanks Steve. At this time, we will open up the call to your questions.

We will now begin the question-and-answer session. [Operator Instructions]. The first question will come from David Scharf of JMP Securities. Please go ahead.

Hi, good afternoon. Thanks for taking my questions. Maybe just hitting upon kind of the big topics, obviously number one is credit. Can you just maybe elaborate -- I think there was a comment about Q1 seasonally -- you may have seen a loss profile a little higher than you typically see [indiscernible] quarter. Is it just timing related to delayed tax refunds, is there anything else you observe?

I think it's a little bit of product mix, with higher short term products, but also really strong customer volume as I mentioned. We thought, with delayed tax returns, that it might be higher than our [indiscernible] models which show, given the mix, but it wasn't. I think given the mix, the credit was right in line with our expectations, so it was pretty much all mix based.

Got it. And you know, a question -- maybe on the gross margin or the provisioning, it looks like sequentially, there was a reserve release around $16 million odd. I imagine, most of that is seasonal, as balances kind of drop in Q1. But I was wondering, specifically with the installment product, on a year-over-year basis, it looks like the loss rates are up a bit, but gross margin is down. But it looks like the reserve rate, the allowance rate has actually come down; 10.9% looks close to a low level. Is that just based on more of a mix of near prime credit kind of customers, or just trying to get a sense for how we ought to be thinking about the allowance rate going forward, with all these moving pieces, and why the ALL came down, when the loss rate has been going up for installment?

So first of all, let me provide a little clarity on the loss rate. So in the first quarter of 2017, the 12.4% in the supplemental table that we have put out, the Brazil impact is in that particular number. So if you adjust for the Brazil impact, that number would have been 10.6%, which you would see is fairly flat to the first quarter of last year.

Got it.

So I think that probably puts a little bit more of the reserving in perspective. But overall, reserving is going to be driven by the mix. Bearing in mind, we have from near prime through the CNU installment products in this particular category, and also the level of new customers, as well as the level of delinquency. So I think, when you look at it, when you look at the loss rate, excluding that one time item and then look at the reserving, I think it probably makes a little bit more sense to you.

Okay. No, that helps a lot. And then maybe the last question, I will get back in line, how should we think about the average life or duration of your entire loan book versus a year ago? Particularly given, the growth in longer term installment loans. Is there an average month we could ascribe to the portfolio on aggregate versus 12 months ago?

It's not a number we have given out, but we do break down balances by product type in our supplemental disclosures, and just understand -- I think you have a general sense of where the average life is by the three buckets -- four buckets rather. So you surely get pretty close from that disclosure.

Got it. Got it. Okay. Thank you.

Yes.

The next question comes from Mike Del Grosso of Jefferies. Please go ahead.

Thank you for taking my question. Quick one on marketing, I understand the guide for mid-teens, can you help us understand the trajectory of that over the course of the year?

Yeah. I think it's going to ramp up over the next few quarters, as normal seasonality would tell you. Kind of gauging third versus fourth quarter is always a little bit [indiscernible] of a crapshoot, because August is a little unpredictable, September strong, and then October can either be weak or kind of in line. So second quarter won't -- shouldn't get there. But third, kind of third to into fourth quarter is when you will see us kind of ramp up into those numbers.

Got it. And then just I guess, jumping on another topic that was already raised, the effective income tax refund delays, obviously had a slight impact on credit. But could you talk about growth and perhaps what you saw for the latter end of the quarter? Any impact there?

Yeah, we actually said the income tax, delayed income tax refunds did not have an impact on credit. The credit was right in line with our product expectations, even without delayed income tax returns, the higher levels of provisioning in the quarter and charge-offs in the quarter, were really related to mix -- more of our short term -- more originations in the short term portfolio, from strong new customer demand, which is very-very positive long term. So that's -- so really good on the credit side, despite the delayed tax returns. In terms of kind of performance through the quarter, ended really strong, even as tax return season, even as taxes turn -- start coming in March, didn't see a precipitous drop-off, like we typically would in January, for example, in a different year. Quarter ended really well for us.

Got it. Thanks guys.

[Operator Instructions]. The next question comes from Gregg Hillman of First Wilshire Securities Management. Please go ahead.

Oh yeah, good afternoon. David, could you talk about U.K. just a little bit? Do you think it is reasonable to assume it will get back to its former profitability level for the change in regulations? And how long might it take to do that?

Yeah. You know, look, the market is a lot smaller there. 40% to 50% smaller than it was before the new rules. And so even as we grow the market share, it's -- we are growing market share in a much smaller market. In addition, the product there is not quite as profitable as it was, prior to the new rules, because of the rate cap that was put in place. So I think it would be a long time out, [indiscernible], before we got to kind of pre-2014 profitability levels. That being said, we are doing really well in the U.K. We saw extremely strong new customer growth in Q1. Credit is performing really well, and as with any market or product that's growing quickly in our business, some of the profitability is masked by that growth, as you put on higher levels of -- as you book a lot of marketing upfront, and put in higher levels of provision upfront. But we are building up some really strong assets that are going to earn us a lot of money in the future, especially if we keep up these levels of origination. Now, getting to those pre-2014 profit levels is a long way away. But there is meaningful growth we believe in that portfolio ahead for us.

Okay. And then David, in terms of getting into new countries, I know you have pulled out from China. Are you in planning stages to enter new countries?

Not right now. We are focused on those fixed growth businesses. We think there is lots of opportunity in those fixed businesses. We think there is meaningful growth in each one of them, other than U.K. We have very low market share in each one of them. So we have a core dev team who keeps their eyes on different countries, runs analysis from time to time, updates those analysis. So we will keep an eye on them. But right now, as we have said, our focus is on those fixed growth businesses.

Okay. And then finally, could you talk about your relationship through public bank and the number of states you are in, how that's changing, and whether you are pleased with that, whether that's going as planned?

Yeah, it's going really well. We continue to add additional states. We have added a significant number, just in the last couple of months, and so that continues to progress. And I think the business is going really well, and should be much larger by the end of this year.

Are you -- I think that you were in like 40 states. Are you in all the big states that you plan to go into?

So the business eventually will be in 40 states. We are not there yet. But only because, we are just taking a measured approach to rolling out to the 40 states, and so we hope to be there, shortly.

[Operator Instructions]. This concludes our question-and-answer session. I would like to turn the conference call back over to David Fisher, CEO, for any closing remarks.

Great, thank you and thanks everyone for joining us today. We look forward to updating you again on our progress next quarter and throughout the year. Have a good evening.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.