CURO GROUP HOLDINGS CORP. MANAGEMENT REPORT OF FINANCIAL POSITION AND RESULTS OF OPERATIONS (Form 10-Q)

Forward-looking statements

The following discussion of financial condition, results of operations,
liquidity and capital resources, our regulatory environment and certain factors
that may affect future results, including company-specific, economic and
industry-wide factors, should be read in conjunction with our unaudited
Condensed Consolidated Financial Statements and accompanying notes included
herein. This Management's Discussion and Analysis of Financial Condition and
Results of Operations contains forward-looking statements. The matters discussed
in these forward-looking statements are subject to risk, uncertainties and other
factors that could cause actual results to differ materially from those made,
projected or implied in the forward-looking statements. Except as required by
applicable law and regulations, we undertake no obligation to update any
forward-looking statements or other statements we may make in the following
discussion or elsewhere in this document even though these statements may be
affected by events or circumstances occurring after the forward-looking
statements or other statements were made. Please see "Risk Factors" in our 2021
Form 10-K for a discussion of the uncertainties, risks and assumptions
associated with these statements.

Insight

We are an omnichannel, technology-driven consumer finance company serving a full spectrum of unprivileged and privileged consumers in the WE and Canada.

Story

CURO was founded in 1997 to meet the growing needs of consumers looking for
alternative access to credit. With 25 years of experience, we offer a variety of
convenient, accessible financial and loan services across all of our markets.
The terms "CURO," "we," "our," "us" and the "Company" refer to CURO Group
Holdings Corp. and its directly and indirectly owned subsidiaries as a combined
entity, except where otherwise stated.

In the U.S., we operate under several principal brands, including "Speedy Cash,"
"Rapid Cash" and "Avio Credit," "Covington Credit," "Heights Finance," "Quick
Credit" and "Southern Finance." We also offer demand deposit accounts in the
U.S. under the Revolve Finance brand, and credit card programs under the First
Phase brand, which we launched in the fourth quarter of 2021. As of March 31,
2022, our store network consisted of 550 locations across 20 U.S. states and we
offered our online services in 27 U.S. states.

In Canada, we operate under "Cash Money" and "LendDirect" direct lending brands
and the "Flexiti" point-of-sale brand. As of March 31, 2022, we operated our
direct lending and online services in eight Canadian provinces and offered our
online services in one Canadian territory. Our point-of-sale operations are
available at nearly 7,700 retail locations and over 3,330 merchant partners
across 10 provinces and two territories.

On December 27, 2021, we acquired Heights Finance, a consumer finance company
that provides Installment loans and offers customary opt-in insurance and other
financial products in the U.S. The acquisition of Heights Finance accelerated
our strategic transition in the U.S. toward longer term, higher balance and
lower credit risk products, and provided us with access to a larger addressable
market while mitigating regulatory risk. On March 10, 2021, we acquired Flexiti,
an emerging growth Canadian POS/BNPL provider, which provided us instant
capability and scale opportunity in Canada's credit card and POS financing
markets. Refer to "Item 1-Business-Company Overview" of our 2021 Form 10-K and

Note 14, “Acquisitions” for further details regarding the acquisitions of Heights Finance and Flexiti. Both acquisitions were accounted for using the purchase method and therefore their results of operations are included in our financial statements from their respective dates of acquisition.

In 2017, we made our first investment in Katapult, an e-commerce focused FinTech
company offering an innovative lease financing solution to consumers and
enabling essential transactions at the merchant POS. In June 2021, Katapult
merged with FinServ, resulting in a new publicly traded company (NASDAQ: KPLT).
Refer to "Item 1-Business-Company Overview" of our 2021 Form 10-K for additional
information about the merger and its benefits to us. In the fourth quarter of
2021, we acquired an additional 2.6 million shares of common stock of Katapult
for an aggregate purchase price of $10.0 million. Our fully diluted ownership of
Katapult as of March 31, 2022 was 25.2%, which assumes full pay-out of earn-out
shares.

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Consolidated operating results

Comparison of consolidated operating results for the three months ended
March 31, 2022 and 2021

Start January 1, 2022, we began reporting “interest and fee income”, “insurance premiums and commissions” and “other income” instead of our previously reported “income” in our Condensed Statements of Income. Prior period presentations have been revised to conform to the current period presentation.

The table below presents our consolidated results of operations. A further
discussion of the results of our operating segments is provided under "--Segment
Analysis" below.

                                                    Three Months Ended March 31,
(in thousands, unaudited)                     2022         2021       Change $    Change %
Revenue
Interest and fees revenue                 $  264,956   $  179,123   $   85,833      47.9  %
Insurance premiums and commissions            18,260       11,569        6,691      57.8  %
Other revenue                                  6,980        5,859        1,121      19.1  %
Total revenue                                290,196      196,551       93,645      47.6  %
Provision for losses                          97,531       36,145       61,386            #
Net revenue                                  192,665      160,406       32,259      20.1  %
Operating Expenses
Salaries and benefits                         79,729       54,917       24,812      45.2  %
Occupancy                                     17,037       14,347        2,690      18.7  %
Advertising                                   10,500        8,084        2,416      29.9  %
Direct operations                             20,274       11,969        8,305      69.4  %
Depreciation and amortization                  9,814        4,965        4,849      97.7  %
Other operating expense                       16,112       12,952        3,160      24.4  %
Total operating expense                      153,466      107,234       46,232      43.1  %
Other expense (income)
Interest expense                              38,341       19,539       18,802      96.2  %
Income from equity method investment          (1,584)        (546)      (1,038)           #

Total other expense                           36,757       18,993       17,764      93.5  %
Income before income taxes                     2,442       34,179      (31,737)    (92.9) %
Provision for income taxes                     1,106        8,444       (7,338)    (86.9) %

Net income                                $    1,336   $   25,735   $  (24,399)    (94.8) %
# - Variance greater than 100% or not meaningful



The decline in Net Income was primarily driven by year-over-year comparisons for
the provision for loan losses and, secondarily, higher interest expense.
Government stimulus and other pandemic-related behavior reduced demand,
increased payment rates and lowered loss rates in the first quarter of 2021,
resulting in a provision for loan losses that was $16.5 million less than net
charge-offs ("NCOs"). Credit normalization and strong sequential loan growth in
the first quarter of 2022 resulted in a provision for loan losses that exceeded
NCOs by $12.1 million, which included the impact of purchase accounting. This
year-over-year shift resulted in a $28.7 million pretax swing year over year.
Interest expense increased because of the additional 7.50% Senior Secured Notes
issued to finance, in part, (i) the Heights Finance acquisition and (ii) the
expansion of non-recourse asset-backed facilities to support loan growth.

Revenue

During the three months ended March 31, 2022, total revenue increased $93.6
million, or 47.6%, to $290.2 million, compared to the prior-year period driven
by our acquisitions of Flexiti and Heights Finance, and secondarily by growth in
Canada Direct Lending. Specifically, the main components were:

•U.S. revenue increase of $61.9 million, or 45.4%, as a result of our Heights
Finance acquisition, which accounted for $65.7 million of total revenue for the
first quarter of 2022. Excluding Heights Finance, U.S. revenue decreased $3.8
million, primarily due to the Runoff Portfolios. Excluding Runoff Portfolios and
Heights Finance, total U.S. revenue increased $13.6 million, or 11.9%, for the
three months ended March 31, 2022 compared to the three months ended

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March 31, 2021;

• Increased Direct Lending Canada revenue by $13.0 million, i.e. 22.3%; and

•Canada POS Lending revenue of $20.3 million, an increase of $18.7 million
compared to the three months ended March 31, 2021, which Flexiti's results only
after its acquisition on March 10, 2021.


The following table summarizes revenue by product, including CSO fees, for the
period indicated:

                                                                                                     Three Months Ended
                                                             March 31, 2022                                                                      March 31, 2021
(in thousands,                               Canada Direct    Canada POS                                                         Canada Direct    Canada POS
unaudited)                        U.S.          Lending        Lending         Total         % of Total               U.S.          Lending        Lending         Total         % of Total
Revolving LOC                 $   26,913    $     45,455    $    18,655    $   91,023               31.4  %       $   26,923    $     34,368    $     1,444    $   62,735               31.9  %
Installment                      162,824          11,109              -       173,933               59.9  %          105,941          10,447              -       116,388               59.2  %

Total interest and commissions 189,737 56,564 18,655

   264,956               91.3  %          132,864          44,815          1,444       179,123               91.1  %
Insurance premiums and
commissions                        5,001          13,023            236        18,260                6.3  %                -          11,569             32        11,601                5.9  %
Other revenue                      3,661           1,901          1,418         6,980                2.4  %            3,628           2,056            143         5,827                3.0  %
  Total revenue               $  198,399    $     71,488    $    20,309    $  290,196              100.0  %       $  136,492    $     58,440    $     1,619    $  196,551              100.0  %


Product revenue for the three months ended March 31, 2022

•Revolving LOC
•Revolving LOC revenue for the three months ended March 31, 2022 increased $28.3
million, or 45.1%, compared to the prior-year period, driven by growth in Canada
Direct Lending revenue of $11.1 million, or 32.3%, and Canada POS lending of
$17.2 million.

•Payment

•Installment revenue for the three months ended March 31, 2022 increased $57.5
million, or 49.4%, compared to the prior-year period. The increase was a result
of our acquisition of Heights Finance in the fourth quarter of 2021, which
accounted for $60.4 million of Installment revenue in the first quarter of 2022.
Excluding Heights Finance, Installment revenue decreased $2.8 million, 2.4% as a
result of Runoff Portfolios. For the three months ended March 31, 2022,
Installment revenues excluding Runoff Portfolios and Heights Finance increased
$11.8 million, or 12.1%, compared to the prior-year period.

•Insurance premiums and commissions
•Insurance premiums and commissions for the three months ended March 31, 2022
increased $6.7 million, or 57.4%, compared to the prior-year period, primarily
driven by our acquisition of Heights Finance, which offers customary opt-in
insurance and accounted for $5.0 million of insurance premiums and commissions
revenue in the first quarter of 2022. Canada Direct Lending grew $1.5 million,
or 12.6%, year over year due to the sale of insurance products to Revolving LOC
and Installment loan customers in Canada.

•Other revenue
•Other revenue for the three months ended March 31, 2022 increased $1.2 million,
or 19.8%, versus the prior-year period as Canada POS Lending included a full
quarter of revenue in 2022.

Provision for losses

•Provision for losses increased by $61.4 million, or 169.8%, for the three
months ended March 31, 2022 compared to the prior-year period, primarily driven
by:
•Continued normalization associated with loan growth as customers return to
pre-COVID-19 payment behaviors as compared to the prior year, when customers
received government stimulus payments. In the first quarter of 2021, the U.S.
provision for loan losses was $13.3 million less than NCOs due to March 2021
government stimulus payments, which improved customer repayment rates and
reduced NCOs and past-due rates to historic lows. In the first quarter of 2022,
the U.S. provision for loan losses, excluding Heights Finance, was $0.8 million
less than NCOs as the seasonal sequential decline was lower compared to prior
year, and NCO rates continued to normalize;
•Full quarter of provision for losses for our Heights Finance acquisition of
$20.7 million;
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•Full quarter of provision for loan losses for Canada POS Lending of $8.7
million, an increase of $7.9 million compared to the prior-year period;
•Loan growth, driven by strong consumer demand, across all loan portfolios
compared to the same period in the prior year; and
•Higher NCO and past-due rates, as COVID-19 Impacts lessened compared to the
same period in the prior year. Refer to "Segment Analysis" sections below for
additional details.

Operating Expenses

The following table summarizes the operating expenses for the period indicated:

                                                    Three Months Ended 

March, 31st,

        (in thousands, unaudited)              2022        2021      Change $   Change %

        Operating Expenses
        Salaries and benefits              $   79,729   $  54,917   $ 24,812      45.2  %
        Occupancy                              17,037      14,347      2,690      18.7  %
        Advertising                            10,500       8,084      2,416      29.9  %
        Direct operations                      20,274      11,969      8,305      69.4  %
        Depreciation and amortization           9,814       4,965      4,849      97.7  %
        Other operating expense                16,112      12,952      3,160      24.4  %
        Total operating expense            $  153,466   $ 107,234   $ 46,232      43.1  %


Operating expenses increased $46.2 millioni.e. 43.1%, driven mainly by:

•Salaries and benefits were $79.7 million for the three months ended March 31,
2022, an increase of $24.8 million, or 45.2%, compared to the prior-year period.
Excluding costs associated with Heights Finance, salaries and benefits increased
$4.6 million, or 8.4%, primarily due to a full quarter of Canada POS Lending
salaries and benefits expense;

•Occupancy costs were $17.0 million for the three months ended March 31, 2022,
an increase of $2.7 million, or 18.7%, compared to the prior-year period.
Excluding costs associated with Heights Finance, occupancy costs decreased $1.4
million, or 9.4%, primarily due to store closures in the U.S. during the second
and third quarters of 2021;

•Advertising costs increased $2.4 million, or 29.9%, year over year on more
normalized spend compared to the first quarter of 2021, which continued to be
affected by COVID-19 Impacts;

•Direct operations were $20.3 million for the three months ended March 31, 2022,
an increase of $8.3 million, or 69.4%, compared to the prior-year period.
Excluding costs associated with Heights Finance, direct operations increased
$5.2 million, or 43.2%, primarily due to higher volume, resulting in higher
collection and variable processing costs, as well as a full quarter of Canada
POS Lending direct operations of $3.7 million for the first quarter of 2022;

•Depreciation and amortization expense for the three months ended March 31, 2022
increased $4.8 million, or 97.7%, compared to the prior-year period, primarily
due a full quarter of Canada POS Lending expense associated with the
amortization of capitalized software development costs, partially offset by
store closures in the U.S. during the second and third quarters of 2021; and

•Other operating expenses were $16.1 million for the three months ended
March 31, 2022an augmentation of $3.2 million, or 24.4%, over the prior year period, primarily driven by our acquired Heights Finance business. Refer to the “Segment Analysis” sections below for details.

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Other expenses (income)

The following table summarizes other expenses (income) for the period indicated:

                                                       Three Months Ended 

March, 31st,

   (in thousands, unaudited)                      2022          2021     Change $   Change %

   Other expense (income)
   Interest expense                          $   38,341      $ 19,539   $ 18,802      96.2  %
   Income from equity method investment          (1,584)         (546)    (1,038)           #

   Total other expense                       $   36,757      $ 18,993   $ 17,764      93.5  %

# – Difference greater than 100% or not significant

Other expenses increased $17.8 millioni.e. 93.5% mainly motivated by:

•Interest expense for the three months ended March 31, 2022 increased $18.8
million, or 96.2%, primarily related to (i) interest on non-recourse debt
assumed with the acquisition of Heights Finance, (ii) interest expense on the
additional $250.0 million issuance of 7.50% Senior Secured Notes in the fourth
quarter of 2021, (iii) interest on Flexiti's warehouse and securitization
facilities, and (iv) higher utilization of the Canada SPV facility,

•Partially offset by our share of Katapult's income of $1.6 million, which
included a gain from revaluing Katapult's public and private warrant liability,
compared to $0.5 million in the prior year.

Provision for income taxes

The effective income tax rate for the three months ended March 31, 2022 was
45.3%. The effective income tax rate was higher than the blended federal and
state/provincial statutory rate of approximately 26%, primarily as a result of
lower income before tax combined with $0.3 million lost tax benefits of
non-deductible officers' compensation and $0.3 million tax expense related to
share-based compensation. The effective income tax rate of adjusted tax expense
included in Adjusted Net Income for the three months ended March 31, 2022 was
31.9%.

Analysis of loan volume and portfolio performance

The following table reconciles Company Owned gross loans receivable, a
GAAP-basis balance sheet measure, to Gross combined loans receivable, a non-GAAP
measure(1). Gross combined loans receivables includes loans originated by
third-party lenders through CSO programs, which are not included in the
unaudited Condensed Consolidated Financial Statements but from which we earn
revenue by providing a guarantee to the unaffiliated lender:

                                                                                            As of
                                               March 31,           December 31,           September 30,           June 30,            March 31,
(in thousands, unaudited)                        2022                  2021                   2021                  2021                2021
U.S.
Revolving LOC                               $     49,077          $    

52,532 $51,196 $47,277 $43,387
Remittance – company property

                      589,652               609,413                 137,987             139,234             142,396
Canada Direct Lending
Revolving LOC                                    424,485               402,405                 366,509             337,700             319,307
Installment                                       23,578                24,792                  24,315              23,564              24,385
Canada POS Lending
Revolving LOC                                    541,776               459,176                 302,349             221,453             201,539
Company Owned gross loans
receivable                                  $  1,628,568          $  

1,548,318 $882,356 $769,228 $731,014
Gross receivables guaranteed by the Company

                                    44,420                46,317                  43,422              37,093              32,439
Gross combined loans receivable
(1)                                         $  1,672,988          $  

1,594,635 $925,778 $806,321 $763,453
(1) See a description of non-GAAP financial measures in “Supplemental Non-GAAP Financial Information”.

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Combined gross loans receivable increased $909.5 millioni.e. 119.1%, at $1,673.0 million from March 31, 2022from $763.5 million from March 31, 2021. The increase was driven by:

•$462.9 million of gross loans receivable from Heights Finance;
•Canada POS Lending growth of $340.2 million, or 168.8%
•Canada Direct Lending growth of $104.4 million, or 30.4%; and
•U.S. gross combined loans receivable growth of $2.1 million, or 0.9%, excluding
Heights Finance. U.S. year-over-year growth was affected by the Runoff
Portfolios, and additional government stimulus in the first half of 2021.
Excluding the Runoff Portfolios and Heights Finance, U.S. gross combined loans
receivable grew $52.8 million, or 34.2%.

Sequentially, gross combined loans receivable increased $78.4 million, or 4.9%,
primarily driven by Canada POS Lending growth of $82.6 million, or 18.0%, and
Canada Direct Lending Revolving LOC growth of $22.1 million, or 5.5%. Gross
combined loans receivable performance by product is described further in the
following sections.

Segment Analysis

The following is a summary of portfolio performance and results of operations
for the segment and period indicated (all periods unaudited except for Q4 2021).
We report financial results for three reportable segments: U.S., Canada Direct
Lending and Canada POS Lending.

U.S. Portfolio Performance
(in thousands, except percentages)               Q1 2022                 Q4 2021(1)             Q3 2021             Q2 2021            Q1 2021
Gross combined loans receivable (2)
Revolving LOC                                $        49,077       $               52,532 $            51,196 $            47,277 $           43,387
Installment loans - Company Owned                    589,652                      137,782             137,987             139,234            142,396
Total U.S. Company Owned gross loans
receivable                                           638,729                      190,314             189,183             186,511            185,783
Installment loans - Guaranteed by the
Company (3)                                           44,420                       46,317              43,422              37,093             32,439
Total U.S. gross combined loans
receivable (2)                               $       683,149       $              236,631 $           232,605 $           223,604 $          218,222

Lending Revenue:
Revolving LOC                                $        26,913       $               27,911 $            27,377 $            24,091 $           26,923
Installment loans - Company Owned                    113,833                       56,820              57,659              55,918             64,516
Installment loans - Guaranteed by the
Company (3)                                           48,991                       47,348              43,377              34,908             41,425
Total U.S. lending revenue                   $       189,737       $              132,079 $           128,413 $           114,917 $          132,864

Lending Provision:
Revolving LOC                                $         9,577       $               11,592 $             8,140 $             6,621 $            5,039
Installment loans - Company Owned                     32,962                       18,618              16,792              14,048             11,159
Installment loans - Guaranteed by the
Company (3)                                           21,749                       25,967              23,146              12,583              9,648
Total U.S. lending provision                 $        64,288       $               56,177 $            48,078 $            33,252 $           25,846

NCO rate (4)
Revolving LOC                                          19.8%                        22.1%               16.9%               16.0%              20.0%
Installment loans - Company Owned                       6.0%                        14.3%               14.1%               13.2%              11.2%
Total U.S. Company Owned NCO rate                       7.1%                        16.4%               14.8%               13.9%              13.3%
Installment loans - Guaranteed by the
Company (3)                                            47.4%                        58.1%               53.2%               34.6%              31.7%
Total U.S. NCO rate                                    14.7%                        24.4%               21.6%               17.2%              16.2%

ALL and CSO Liability for Losses rate
(4)
Revolving LOC                                        26.7  %                        25.9%               26.3%               28.9%              33.0%
Installment loans - Company Owned                     4.2  %                        12.7%               13.4%               15.3%              18.1%
Total U.S. Company Owned ALL rate                     5.9  %                        16.3%               16.9%               18.7%              21.6%
Installment loans - Guaranteed by the
Company (3)                                          16.1  %                        14.9%               16.1%               14.2%              14.6%


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(in thousands, except percentages)               Q1 2022               Q4 2021(1)         Q3 2021         Q2 2021        Q1 2021
Total ALL and CSO Liability for Losses
rate                                                   6.6  %                   16.0%           16.8%           18.0%          20.6%

Past-due rate (5)
Revolving LOC                                         29.7  %                   30.5%           30.5%           26.6%          26.3%
Installment loans - Company Owned                     19.1  %                   19.4%           20.1%           18.7%          18.0%
Total U.S. Company Owned past-due rate                19.9  %                   22.5%           22.9%           20.7%          19.9%

Installment loans - Guaranteed by the
Company (3)                                           18.5  %                   17.7%           19.8%           17.4%          12.8%

(1) On December 27, 2021, we acquired Heights Finance, which accounted for approximately $472 million of U.S. Installment loans as
of December 31, 2021. As the period between December 27, 2021 and December 31, 2021 did not result in material loan performance, we
have excluded Heights Finance from the table for the fourth quarter of 2021.
(2) Non-GAAP measure. For a description of each non-GAAP metric, see "Non-GAAP Financial Measures."
(3) Includes loans originated by third-party lenders through CSO programs. Installment gross loans receivable Guaranteed by the
Company are not included in the Consolidated Financial Statements.
(4) We calculate NCO rate as total NCOs divided by Average gross loans receivables.

(5) We calculate (i) the ALL and CSO liability rate for losses and (ii) the default rate as the respective totals divided by the gross loans receivable at each respective quarter end.

WE Net revenue

U.S. revenues increased by $61.9 million, or 45.4%, to $198.4 million, for the
three months ended March 31, 2022, compared to the prior-year period as a result
of our acquisition of Heights Finance, with loan balances in our legacy U.S.
business being affected by the Runoff Portfolios. See the loan performance
discussions below for further details. Excluding Heights Finance and the
impacted Runoff Portfolios, U.S. revenues increased $13.6 million, or 11.9%,
year over year.

The provision for losses increased $40.8 million, or 156.5%, year over year,
primarily driven by (i) normalized provisioning on loan growth as customer
behavior returns to pre-COVID-19 levels, (ii) full quarter provision for our
Heights Finance acquisition, and (iii) higher NCO and past-due rates as COVID-19
Impacts lessened compared to the same period in the prior year. Excluding
Heights Finance, U.S. NCO and past-due rates, including loans Guaranteed by the
Company, increased by 440 bps, or 27.2%, and 240 bps, or 12.7%, respectively,
year over year.

WE Yield on revolving LOC loans

U.S. Revolving LOC loan balances as of March 31, 2022 increased $5.7 million, or
13.1%, compared to the prior year. NCO rates improved 20 bps year over year and
230 bps sequentially. Past-due rates rose 340 bps year over year from COVID-19
Impacts in the prior year and improved 80 bps sequentially.

WE Performance of Installment Loans – Company Owned

U.S. Installment loan balances as of March 31, 2022 increased $447.3 million, or
314.1%, and revenue increased $49.3 million, or 76.4%, compared to the prior
year, primarily as a result of our acquisition of Heights Finance, partially
offset by the Runoff Portfolios. NCO rates improved 500 bps year over year and
820 bps sequentially as a result of Heights Finance. Past-due rates rose 110 bps
year over year from COVID-19 Impacts in the prior year and improved
sequentially.

WE Performance of the installment loan – Guaranteed by the Company

U.S. Installment loans Guaranteed by the Company increased $12.0 million, or
36.9%, year over year. For the three months ended March 31, 2022, NCO rates
increased from 31.7% to 47.4% year over year primarily due to loan growth, and
within this growth a shift to more new borrowers versus seasoned borrowers and
more online originations versus store-based, both of which carry higher risk in
their early stages. Past-due rates rose 575 bps year over year from COVID-19
Impacts in the prior year.

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Following is a summary of results of operations for the U.S. segment for the
periods indicated.

                                                                           Three Months Ended March 31,
(dollars in thousands, unaudited)                               2022            2021        Change $         Change %
Revenue
Interest and fees revenue                                $       189,737    $  132,864    $   56,873               42.8  %
Insurance premiums and commissions                                 5,001             -         5,001                     #
Other revenue                                                      3,661         3,628            33                0.9  %
Total revenue                                                    198,399       136,492        61,907               45.4  %
Provision for losses                                              66,825        26,056        40,769                     #
Net revenue                                                      131,574       110,436        21,138               19.1  %
Operating expenses
Salaries and benefits                                             59,661        41,510        18,151               43.7  %
Occupancy                                                         10,934         8,535         2,399               28.1  %
Advertising                                                        9,262         7,141         2,121               29.7  %
Direct operations                                                 13,674         9,123         4,551               49.9  %
Depreciation and amortization                                      4,559         3,126         1,433               45.8  %
Other operating expense                                           12,851        10,458         2,393               22.9  %
Total operating expenses                                         110,941        79,893        31,048               38.9  %
Other expense (income)
Interest expense                                                  27,685        16,358        11,327               69.2  %
Income from equity method investment                              (1,584)         (546)       (1,038)                    #

Total other expense                                               26,101        15,812        10,289               65.1  %
Segment operating (loss) income                                   (5,468)       14,731       (20,199)                    #
Interest expense                                                  27,685        16,358        11,327               69.2  %
Depreciation and amortization                                      4,559         3,126         1,433               45.8  %
EBITDA (1)                                                        26,776        34,215        (7,439)             (21.7) %
Restructuring costs                                                1,069             -         1,069
Legal and other costs                                                 87             -            87
Income from equity method investment                              (1,584)         (546)       (1,038)

Transaction costs                                                    168         3,160        (2,992)

Acquisition-related adjustments                                        3             -             3
Share-based compensation                                           3,503         2,683           820
Other adjustments                                                   (245)         (246)            1
Adjusted EBITDA (1)                                      $        29,777    $   39,266    $   (9,489)             (24.2) %
# - Variance greater than 100% or not meaningful.
(1) These are non-GAAP metrics. For a description of each non-GAAP addback, see the applicable reconciliations contained
under "Consolidated Results of Operations." For a description of each non-GAAP metric, see "Non-GAAP Financial Measures."



WE Segment Results – For Three Months Ended March 31, 2022 and 2021

For a discussion of revenue, provision for losses and related gross combined
loans receivables for the three months ended March 31, 2022 and 2021, see "U.S.
Portfolio Performance," above.

Operating expenses for the three months ended March 31, 2022 have been $110.9 millionan augmentation of $31.0 millioni.e. 38.9%, compared to $79.9 million for the three months ended March 31, 2021mainly motivated by $33.8 million operating expenses associated with Heights Finance.

U.S. interest expense for the three months ended March 31, 2022 increased $11.3
million, or 69.2%, primarily driven by interest on debt assumed in the
acquisition of Heights Finance, (ii) interest expense on the additional $250.0
million issuance of 7.50% Senior Secured Notes, and (iii) higher interest
expense on the U.S. SPV facility.

                                       38


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As previously described, we recognize our share of Katapult's income or loss on
a one-quarter lag. We recorded income of $1.6 million for the three months ended
March 31, 2022. We own 25.2% of Katapult on a fully diluted basis assuming full
pay-out of earn-out shares as of March 31, 2022.

Canada Direct Lending Portfolio Performance
(in thousands, except percentages)                Q1 2022          Q4 2021          Q3 2021          Q2 2021          Q1 2021
Gross loans receivable
Revolving LOC                                 $        424,485 $        402,405 $        366,509 $        337,700 $       319,307
Installment loans                                       23,578           24,792           24,315           23,564          24,385
Total gross loans receivable                  $        448,063 $        427,197 $        390,824 $        361,264 $       343,692

Lending Revenue:
Revolving LOC                                 $         45,455 $         43,943 $         40,239 $         37,450 $        34,368
Installment loans                                       11,109           11,416           11,331           10,541          10,447
Total lending revenue                         $         56,564 $         55,359 $         51,570 $         47,991 $        44,815

Lending Provision:
Revolving LOC                                 $         19,156 $         20,080 $         11,375 $          7,066 $         7,909
Installment loans                                        2,723            2,945            2,512            1,438           1,234
Total lending provision                       $         21,879 $         23,025 $         13,887 $          8,504 $         9,143

NCO rate (1)
Revolving LOC                                             5.2%             3.9%             2.8%             3.3%            3.6%
Installment loans                                        10.9%            11.2%            10.2%             6.3%            6.5%
Total NCO rate                                            5.5%             4.4%             3.3%             3.5%            3.8%

ALL rate (2)
Revolving LOC                                           7.2  %           8.0  %           7.5  %           7.9  %          9.4  %
Installment loans                                       8.8  %           8.0  %           7.4  %           7.5  %          7.5  %
Total ALL rate                                          7.3  %           8.0  %           7.5  %           7.9  %          9.2  %

Past-due rate (2)
Revolving LOC                                           8.0  %           8.9  %           6.8  %           5.8  %          6.4  %
Installment loans                                       2.0  %           2.2  %           2.0  %           2.3  %          2.1  %
Total past-due rate                                     7.7  %           8.5  %           6.5  %           5.5  %          6.1  %

(1) We calculate the NCO rate as total NCO divided by average gross loans receivable.

(2) We calculate the ALL rate and the overdue rate as the respective totals divided by the gross loans receivable at each respective quarter end.

Canada’s net direct lending revenue

Canada’s direct lending revenue increased year-over-year by $13.0 millioni.e. 22.3%, ($13.1 millionor 22.4%, at constant exchange rate), for the three months ended March 31, 2022due to the growth of Revolving LOC loans in Canada.

The provision for losses increased $12.8 million, or 138.2%, ($12.8 million, or
138.3%, on a constant currency basis), to $22.0 million for the three months
ended March 31, 2022, compared to $9.2 million in the prior-year period. The
increase in provision for losses was primarily driven by (i) normalized
provisioning on loan growth as customer behavior returns to pre-COVID-19 levels,
and (ii) higher NCO and past-due rates as COVID-19 Impacts lessened compared to
the same period in the prior year.

Canada Direct Loan Revolving Line of Credit Loan Performance

Canada Direct Lending Revolving LOC gross loans receivable increased $105.2
million, or 32.9%, ($103.0 million, or 32.3%, on a constant currency basis) year
over year and $22.1 million, or 5.5% ($15.1 million, or 3.7%, on a constant
currency basis) sequentially. Revolving LOC revenue increased $11.1 million, or
32.3%, year over year and $1.5 million, or 3.4%, sequentially
                                       39


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($11.1 million, or 32.3%, and $1.7 million, or 4.0%, respectively, on a constant
currency basis). The quarterly NCO rate increased year over year from 3.6% to
5.2% as of March 31, 2022 and from 3.9% to 5.2% as of March 31, 2022 as COVID-19
Impacts lessened compared to the same period in the prior year. Past-due rates
rose 160 bps year over year but improved 80 bps sequentially.

Canada Direct Lending Installment Loan Performance

Canada Direct Lending Installment revenue increased $0.7 million, or 6.3%, ($0.7
million, or 6.4%, on a constant currency basis) year over year. Installment
gross loans receivable decreased $0.8 million, or 3.3% ($0.9 million, or 3.8%,
on a constant currency basis) year over year. The year-over-year decrease in
Installment loans was due to a continued shift to Revolving LOC loans. The NCO
rate increased year over year from 6.5% to 10.9% as of March 31, 2022 as
COVID-19 Impacts lessened compared to the same period in the prior year. The
year-over-year and sequential past-due rate for Installment loans remained
consistent.

Canada Direct Lending Operating Results

                                                                   Three Months Ended March 31,
(dollars in thousands, unaudited)                      2022          2021        Change $         Change %
Revenue
Interest and fees revenue                          $   56,564    $   44,815    $   11,749               26.2  %
Insurance premiums and commissions                     13,023        11,569         1,454               12.6  %
Other revenue                                           1,901         2,056          (155)              (7.5) %
Total revenue                                          71,488        58,440        13,048               22.3  %
Provision for losses                                   21,992         9,234        12,758                     #
Net revenue                                            49,496        49,206           290                0.6  %
Operating expenses
Salaries and benefits                                  13,398        12,287         1,111                9.0  %
Occupancy                                               5,877         5,802            75                1.3  %
Advertising                                               938           904            34                3.8  %
Direct operations                                       2,853         2,118           735               34.7  %
Depreciation and amortization                           1,123         1,126            (3)              (0.3) %
Other operating expense                                 2,832         2,367           465               19.6  %
Total operating expenses                               27,021        24,604         2,417                9.8  %
Other expense
Interest expense                                        4,030         2,355         1,675               71.1  %
Total other expense                                     4,030         2,355         1,675               71.1  %
Segment operating income                               18,445        22,247        (3,802)             (17.1) %
Interest expense                                        4,030         2,355         1,675               71.1  %
Depreciation and amortization                           1,123         1,126            (3)              (0.3) %
EBITDA (1)                                             23,598        25,728        (2,130)              (8.3) %

Share-based compensation                                  115             -           115                     #

Other adjustments                                          87            41            46
Adjusted EBITDA (1)                                $   23,800    $   25,769    $   (1,969)              (7.6) %
# - Variance greater than 100% or not meaningful.
(1) These are non-GAAP metrics. For a description of each non-GAAP addback, see the applicable reconciliations
contained under "Results of Consolidated Operations." For a description of each non-GAAP metric, see "Non-GAAP
Financial Measures."



                                       40

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Canadian Direct Lending Results – Three Months Ended March 31, 2022 and 2021

For an analysis of revenue, loss allowance and related gross combined loans for the three months ended March 31, 2022 and 2021, see “Performance of Canada’s Direct Lending Portfolio” above.


Canada Direct Lending operating expenses were $27.0 million for the three months
ended March 31, 2022, an increase of $2.4 million, or 9.8%, ($2.4 million, or
9.9%, on a constant currency basis), compared to the prior year, primarily due
to higher variable costs, primarily collection and financial service fees, on
higher volume year over year.

Interest expense for the three months ended March 31, 2022 been $4.0 million
compared to $2.4 million for the three months ended March 31, 2021 due to increased use of the SPV Canada facility.

Performance of Canada’s POS loan portfolio

(in thousands, except percentages)                Q1 2022          Q4 2021          Q3 2021          Q2 2021          Q1 2021
Revolving LOC

Total gross loans receivable                  $        541,776 $        459,176 $        302,349 $        221,453 $       201,539

Total lending revenue                         $         18,655 $         13,704 $         10,646 $          6,495 $         1,383

Total lending provision                       $          8,714 $         12,511 $          8,285 $          2,986 $           855

NCO rate (1)(2)                                         0.5  %           0.5  %           0.7  %           0.7  %          NM (3)

ALL rate (4)                                            5.1  %           4.8  %           3.8  %           2.1  %          0.3  %

Past-due rate (4)(5)                                    4.2  %           4.1  %           4.8  %           5.4  %          5.7  %

(1) For the second, third and fourth quarters of 2021, NCOs presented above include $2.4 million, $0.6 million and $0.8 million,
respectively, of NCO's related to the fair value discount, which are excluded from provision.
(2) We calculate NCO rate as total NCOs divided by Average gross loans receivables.
(3) Not material or not meaningful.

(4) We calculate the ALL rate and the default rate as the respective totals divided by the gross loans receivable (excluding the fair value discount on acquired loans) at each respective quarter-end. (5) The Canada POS Loan Late Rate for loans over 31 days was 2.2%, 1.9%, 2.1%, 2.6% and 3.0% for three months completed March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021respectively.

Yield of Revolving LOC Loans in Canada POS Lending

Canada POS Lending revenue increased year over year by $18.7 million driven by
(i) a full quarter of revenue as of March 31, 2022 compared to a partial quarter
in the prior year, and (ii) year-over-year loan growth of $340.2 million, or
168.8%. The increase in gross loans receivables were driven by new merchant
partners throughout 2021, the most notable being LFL, Canada's largest home
furnishings retailer. Revolving LOC gross loans receivable generally charge-off
at 180 days past due. The NCO and past-due rates for the quarter were 0.5% and
4.2%, respectively, and remained consistent sequentially. Past-due rates
improved year over year by 140 bps.

Originations for the three months ended March 31, 2022 were C$255.3 million, an
increase of C$170.3 million, or 200.2%, from the prior-year period of C$85.0
million. Sequentially, Canada POS Revolving LOC gross loans receivable increased
$82.6 million, or 18.0%.

                                       41

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Canada POS Loans Operating Results

                                                                      Three Months Ended March 31,
(dollars in thousands, unaudited)                                 2022                     2021 (1)

Revenue

Interest and fees revenue                                 $           18,655    $                      1,444
Insurance premiums and commissions                                       236                               -
Other revenue                                                          1,418                             175
Total revenue                                                         20,309                           1,619
Provision for losses                                                   8,714                             855
Net revenue                                                           11,595                             764
Operating expenses
Salaries and benefits                                                  6,670                           1,120
Occupancy                                                                226                              10
Advertising                                                              300                              39
Direct operations                                                      3,747                             728
Depreciation and amortization                                          4,132                             713
Other operating expense                                                  429                             127
Total operation expenses                                              15,504                           2,737
Other expense
Interest expense                                                       6,626                             826
Total other expense                                                    6,626                             826
Segment operating loss                                               (10,535)                         (2,799)
Interest expense                                                       6,626                             826
Depreciation and amortization                                          4,132                             713
EBITDA (2)                                                               223                          (1,260)
Acquisition-related adjustments                                          218                               -
Change in fair value of contingent consideration                        (264)                              -
Share-based compensation                                                 475                               -
Other adjustments                                                         70                               -
Adjusted EBITDA (2)                                       $              722    $                     (1,260)
# - Variance greater than 100% or not meaningful.
(1) The totals reported for the quarter ended March 31, 2021 include results from the date of acquisition,
March 10, 2021, through March 31, 2021.
(2) These are non-GAAP metrics. For a description of each non-GAAP addback, see the applicable reconciliations
contained under "Consolidated Results of Operations." For a description of each non-GAAP metric, see "Non-GAAP
Financial Measures."



Canadian POS Lending Segment Results – Three Months Ended March 31, 2022
and 2021

A comparison of the year-over-year results for the three months ended March 31,
2022 compared to March 31, 2021 are not meaningful as we acquired Flexiti as of
March 10, 2021. For a discussion of revenue, provision for losses and related
gross loans receivables, see the "Canada POS Lending Portfolio Performance,"
above for the three months ended March 31, 2022.

                                       42


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Additional Non-GAAP Financial Information

Non-GAAP Financial Measures

In addition to the financial information prepared in accordance with WE
GAAP, we provide certain “non-GAAP financial measures”, including:

•Adjusted Net Income and Adjusted Earnings Per Share, or the Adjusted Earnings
Measures (net income plus or minus certain legal and other costs, income or loss
from equity method investment, goodwill and intangible asset impairments,
transaction-related costs, restructuring costs, adjustments related to
acquisition accounting, share-based compensation, intangible asset amortization
and cumulative tax effect of applicable adjustments, on a total and per share
basis);
•EBITDA (earnings before interest, income taxes, depreciation and amortization);
•Adjusted EBITDA (EBITDA plus or minus certain non-cash and other adjusting
items);
•Adjusted effective income tax rate (effective tax rate plus or minus certain
non-cash and other adjusting items); and
•Gross Combined Loans Receivable (includes loans originated by third-party
lenders through CSO programs which are not included in the Consolidated
Financial Statements).

We believe that the presentation of non-GAAP financial information is meaningful
and useful in understanding the activities and business metrics of the Company's
operations. We believe that these non-GAAP financial measures reflect an
additional way of viewing aspects of the business that, when viewed with the
Company's U.S. GAAP results, provide a more complete understanding of factors
and trends affecting the business.

We believe that investors regularly rely on non-GAAP financial measures, such as
Adjusted Net Income, Adjusted Earnings per Share, EBITDA and Adjusted EBITDA, to
assess operating performance and that such measures may highlight trends in the
business that may not otherwise be apparent when relying on financial measures
calculated in accordance with U.S. GAAP. In addition, we believe that the
adjustments shown above are useful to investors in order to allow them to
compare our financial results during the periods shown without the effect of
each of these income or expense items. In addition, we believe that Adjusted Net
Income, Adjusted Earnings per Share, EBITDA and Adjusted EBITDA are frequently
used by securities analysts, investors and other interested parties in the
evaluation of public companies in our industry, many of which present Adjusted
Net Income, Adjusted Earnings per Share, EBITDA and/or Adjusted EBITDA when
reporting their results.

In addition to reporting loans receivable information in accordance with U.S.
GAAP, we provide Gross Combined Loans Receivable consisting of owned loans
receivable plus loans originated by third-party lenders through the CSO
programs, which we guarantee but do not include in the Condensed Consolidated
Financial Statements. Management believes this analysis provides investors with
important information needed to evaluate overall lending performance.

We provide non-GAAP financial information for informational purposes and to
enhance understanding of the U.S. GAAP Consolidated Financial Statements.
Adjusted Net Income, Adjusted Earnings per Share, EBITDA, Adjusted EBITDA and
Gross Combined Loans Receivable should not be considered as alternatives to
income, segment operating income, or any other performance measure derived in
accordance with U.S. GAAP, or as an alternative to cash flows from operating
activities or any other liquidity measure derived in accordance with U.S. GAAP.
Readers should consider the information in addition to, but not instead of or
superior to, the financial statements prepared in accordance with U.S. GAAP.
This non-GAAP financial information may be determined or calculated differently
by other companies, limiting the usefulness of those measures for comparative
purposes.

Description and reconciliations of non-GAAP financial measures

Adjusted Net Income, Adjusted Earnings per Share, EBITDA and Adjusted EBITDA
Measures have limitations as analytical tools, and you should not consider these
measures in isolation or as a substitute for analysis of our income or cash
flows as reported under U.S. GAAP. Some of these limitations are:

•they do not include cash expenditures or future requirements for capital
expenditures or contractual commitments;
•they do not include changes in, or cash requirements for, working capital
needs;
•they do not include the interest expense, or the cash requirements necessary to
service interest or principal payments on debt;
•depreciation and amortization are non-cash expense items reported in the
statements of cash flows; and
•other companies in our industry may calculate these measures differently,
limiting their usefulness as comparative measures.

We calculate Adjusted Earnings per Share utilizing diluted shares outstanding at
year-end. If the Company records a loss under U.S. GAAP, shares outstanding
utilized to calculate Diluted Earnings per Share are equivalent to basic shares
outstanding. Shares outstanding utilized to calculate Adjusted Earnings per
Share reflect the number of diluted shares the Company would have reported if
reporting net income under U.S. GAAP.
                                       43


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As noted above, Gross Combined Loans Receivable includes loans originated by
third-party lenders through CSO programs which are not included in the
consolidated financial statements but from which we earn revenue and for which
we provide a guarantee to the lender. Management believes this analysis provides
investors with important information needed to evaluate overall lending
performance.

We believe Adjusted Net Income, Adjusted Earnings per Share, EBITDA and Adjusted
EBITDA are used by investors to analyze operating performance and to evaluate
our ability to incur and service debt and the capacity for making capital
expenditures. Adjusted EBITDA is also useful to investors to help assess our
estimated enterprise value. The computation of Adjusted EBITDA as presented in
this Form 10-Q may differ from the computation of similarly-titled measures
provided by other companies.

Reconciliation of net earnings and diluted earnings per share to adjusted net earnings and adjusted diluted earnings per share, non-GAAP measures (in thousands, except per share data, unaudited)

                                                                                Three Months Ended
                                                                                     March 31,
                                                                 2022         2021       Change $        Change %
Net income                                                   $   1,336    $  25,735    $  (24,399)              (95) %
Adjustments:

Restructuring costs (1)                                          1,069            -
Legal and other costs (2)                                           87            -

Income from equity method investment (3)                        (1,584)     

(546)

Transaction costs (4)                                              168      

3,160

Acquisition-related adjustments (5)                                221      

Change in fair value of contingent consideration (6)              (264)     

Share-based compensation (7)                                     4,093      

2,683

Intangible asset amortization (8)                                2,977      

831

Cumulative tax effect of adjustments (9)                        (1,828)      (1,735)
Adjusted Net Income                                          $   6,275    $  30,128    $  (23,853)            (79.2) %

Net income                                                     $ 1,336     $ 25,735
Diluted Weighted Average Shares Outstanding                     41,308      

43,596

Adjusted Diluted Weighted Average Shares Outstanding            41,308      

43,596

Diluted Earnings per Share                                   $    0.03    $    0.59    $    (0.56)            (94.9) %
Per Share impact of adjustments to Net income                     0.12      

0.10

Adjusted Diluted Earnings per Share                          $    0.15    $    0.69    $    (0.54)            (78.3) %

Note: Footnotes follow the Net Income Reconciliation table on the next page


                                       44

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Reconciliation of net income to EBITDA and Adjusted EBITDA, non-GAAP measures (in thousands, except per share data, unaudited)

                                                                                Three Months Ended
                                                                                     March 31,
                                                                 2022         2021       Change $        Change %
Net income                                                   $   1,336    $  25,735    $  (24,399)            (94.8) %
Provision for income taxes                                       1,106        8,444        (7,338)            (86.9) %
Interest expense                                                38,341       19,539        18,802              96.2  %
Depreciation and amortization                                    9,814        4,965         4,849              97.7  %
EBITDA                                                          50,597       58,683        (8,086)            (13.8) %

Restructuring costs (1)                                          1,069            -
Legal and other costs (2)                                           87            -

Income from equity method investment (3)                        (1,584)     

(546)

Transaction costs (4)                                              168      

3,160

Acquisition-related adjustments (5)                                221      

Change in fair value of contingent consideration (6)              (264)           -

Share-based compensation (7)                                     4,093        2,683

Other adjustments (10)                                             (88)        (205)
Adjusted EBITDA                                              $  54,299    $  63,775    $   (9,476)            (14.9) %
Adjusted EBITDA Margin                                            18.7  %      32.4  %
# - Change greater than 100% or not meaningful



(1) Restructuring costs for the three months ended March 31, 2022 resulted from WE shop

closures and related costs and certain severance packages to eliminate duplicate roles. (2) Legal and other fees for the three months ended March 31, 2022 mainly related to

settlement costs related to certain legal matters.

(3) The amount declared is our share of the capital of Katapult WE GAAP net income, recognized on a

quarter shift. (4) Transaction costs for the three months ended March 31, 2022 relate to our heights

Finance the acquisition by December 2021.

Transaction costs for the three months ended March 31, 2021 relate to the acquisition of

Flexiti in March 2021. (5) During the three months ended March 31, 2022, $0.2 million related to the acquisition

the adjustments relate to the Flexiti loan portfolio acquired during March 10, 2021. (6) As part of our acquisition of Flexiti, we recorded a $0.3 million adjustment

related to the fair value of the contingent consideration for the three months ended

March 31, 2022. (7) The estimated fair value of share-based awards has been accounted for as non-cash compensation

charge on a straight-line basis over the vesting period. (8) Amortization of intangible assets in the determining ANN for the three months ended in March

31 2022 mainly includes the amortization of identifiable intangible assets established

in connection with the acquisitions of Flexiti and Heights Finance. (9) Cumulative tax effect of adjustments included in the reconciliation of net income with

The adjusted net income table is calculated using the additional tax rate estimated by

country.

(10) Other adjustments primarily reflect the impact of intercompany foreign exchange rates.

Currency Information

We operate in the WE and Canada and our consolidated results are presented in
WE dollars.

Changes in our reported revenues and net income include the effect of changes in
currency exchange rates. We translate all balance sheet accounts into U.S.
dollars at the currency exchange rate in effect at the end of each period. We
translate the statement of operations at the average rates of exchange for the
period. We record currency translation adjustments as a component of Accumulated
Other Comprehensive Income in Stockholders' Equity.

Constant Currency Analysis

We have operations in the U.S. and Canada. In the three months ended March 31,
2022 and 2021, 31.6% and 30.6%, respectively, of our revenues were originated in
Canada. As a result, changes in our reported results include the impacts of
changes in foreign currency exchange rates for the Canadian Dollar.

                                       45


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Income Statement

                                                                    Three Months Ended March 31,
                                                 2022               2021                  $ Change           % Change
Average Exchange Rates for the Canadian
Dollar                                              0.7893           0.7897                (0.0004)                (0.1) %


Balance sheet – Exchange rate at March 31, 2022 and December 31, 2021

                                              March 31,    December 31,          Change
                                                 2022          2021             $        %
   Exchange Rate for the Canadian Dollar      0.7978        0.7846         

0.0132 1.7%



The following constant currency analysis removes the impact of the fluctuation
in foreign exchange rates and utilizes constant currency results in our analysis
of the Canada Direct Lending segment performance. Our constant currency
assessment assumes foreign exchange rates in the current fiscal periods remained
the same as in the prior fiscal periods. All conversion rates below are based on
the U.S. Dollar equivalent to the Canadian Dollar. We believe that the constant
currency assessment below is a useful measure in assessing the comparable growth
and profitability of our operations.

We calculated the revenues and gross margin below for our Canada segments during
the three months ended March 31, 2022 using the actual average exchange rate
during the three months ended March 31, 2021 (in thousands, unaudited).

                                                                     Three 

Months ended March, 31st,

                                                       2022          2021             $ Change        % Change
Canada Direct Lending - constant currency basis:
Revenues                                          $   71,515      $ 58,440          $  13,075                22.4  %
Net revenue                                           49,513        49,206                307                 0.6  %
Segment operating income                              18,450        22,247             (3,797)              (17.1) %
Canada POS Lending - constant currency basis(1):
Revenues                                          $   20,319      $  1,619          $  18,700             1,155.0  %
Net revenue                                           11,600           764             10,836             1,418.3  %
Segment operating income                             (10,539)       (2,799)            (7,740)              276.5  %

(1) Totals reported for the quarter ended March 31, 2021 include results since the date of acquisition, March 10, 2021by March 31, 2021.



We calculated gross loans receivable for our Canada segments below as of
March 31, 2022 using the actual exchange rate as of December 31, 2021 (in
thousands, unaudited).

                                            March 31,         December 31,                     Change
                                               2022               2021                   $               %
Canada Direct Lending - constant currency basis:
Gross loans receivable                    $   440,665       $     427,197          $    13,468              3.2  %
Canada POS Lending - constant currency basis:
Gross loans receivable                    $   532,830       $     459,176          $    73,654             16.0  %


CASH AND CAPITAL RESOURCES

Our principal sources of liquidity to fund the loans we make to our customers
are (i) cash provided by operations, (ii) our revolving credit facilities and
our non-recourse funding facilities, as further described in Note 5, "Debt" of
the Notes to the Consolidated Financial Statements, and (iii) funds from
third-party lenders under our CSO programs.

As of March 31, 2022, we were in compliance with all financial ratios, covenants
and other requirements in our debt agreements. We anticipate that our primary
use of cash will be to fund growth in our working capital, finance capital
expenditures to further our growth strategy in both the U.S. and Canada, and
meet our debt obligations. We may also use cash for potential strategic
investments in and acquisitions of other companies that help us extend our reach
and product portfolio. Additionally, we may use cash to fund a return on capital
for our stockholders through share repurchase programs, or in the form of
dividends. In the first quarter of 2021, our Board of Directors increased the
quarterly dividend to $0.11 per share, an increase of 100%. Additionally, in
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May 2021 our Board of Directors authorized a $50.0 million share repurchase
program which concluded in February 2022. A new $25.0 million share repurchase
program was authorized in February 2022, which will commence at our discretion.
Refer to   Note 15, "Share Repurchase Program  " of the Notes to the unaudited
Condensed Consolidated Financial Statements for further details of the program.

Our level of cash flow provided by operating activities typically experiences
seasonal fluctuations related to our levels of net income and changes in working
capital levels, particularly loans receivable. Unexpected changes in our
financial condition or other unforeseen factors may result in our inability to
obtain third-party financing or could increase our borrowing costs in the
future. We have the ability to adjust our volume of lending to consumers to the
extent we experience any short-term or long-term funding shortfalls, such as
tightening our credit approval practices (as we did during the COVID-19
pandemic), which has the effect of reducing cash outflow requirements while
increasing cash inflows through loan repayments.

We may also sell or securitize our assets, draw on our available revolving
credit facility or line of credit, enter into additional refinancing agreements
or reduce our capital spending to generate additional liquidity. The impacts to
cash as described in "-Cash Flows" below and other factors resulted in our
available cash on hand of $60.2 million and our total liquidity of
$117.7 million as of March 31, 2022. We believe our cash on hand and available
borrowings provide us with sufficient liquidity for at least the next 12 months.

Our recent acquisitions of Flexiti and Heights Finance have increased our
product offerings to include customers in the near-prime and prime space. The
acquisition of Flexiti allows us to tailor our current product structure to its
POS model, potentially expanding to sub-prime customers. The acquisition of
Heights Finance accelerates our strategic transition in the U.S. toward longer
term, higher balance and lower rate credit products and provides us with access
to a larger addressable market while mitigating regulatory risk. These
initiatives to expand our product offerings and grow the U.S. and Canada
businesses can materially impact our future cash flows. For further information
regarding the acquisitions, refer to   Note 1, "Summary of Significant
Accounting Policies and Nature of Operations,"     Note 13, "Goodwill,"   and
  Note 14, "Acquisitions"   of the Notes to the unaudited Condensed Consolidated
Financial Statements.

We have no other material commitments or demands that could affect our liquidity.

Debt Capitalization Summary
(in thousands, net of deferred financing costs)

                                                                                                                                            Balance as of
                                                                                                                                            March 31, 2022
                                      Capacity              Interest Rate              Maturity                Counterparties                  (in USD)

7.50% Senior Secured Notes (due
2028) (2)                             $1.0 billion          7.50%                      August 1, 2028                                      $     981,156
                                                                                                               BayCoast Bank; Stride Bank;
                                                                                                               Hancock-Whitney Bank;
Senior Secured Revolving Credit                                                                                Metropolitan Commercial
Facility                              $50.0 million         1-Mo LIBOR + 5.00%         June 30, 2022           Bank                               20,000
                                                                                                               Atalaya Capital Management,
U.S. SPV                              $200.0 million        1-Mo LIBOR + 6.25%         April 8, 2024           MetaBank                           45,843
Heights Finance SPV                   $350.0 million        1-Mo LIBOR + 5.25%         December 31, 2024       Ares Capital                      324,224
Canada SPV(1)                         C$400.0 million       3-Mo CDOR + 6.00%          August 2, 2026          Waterfall Asset Management        240,661
                                                                                                               Credit Suisse (Class A);
Flexiti SPE(1)                        C$500.0 million       3-Mo CDOR + 4.40%          March 10, 2024          SPF (Class B)                     234,754
                                                                                                               National Bank of Canada;
                                                                                                               Precision Trust, an
                                                                                                               affiliate of the Bank of
                                                                                                               Montreal; and WF Torca,
                                                                                                               Ltd., a fund managed by
Flexiti Securitization(1)             C$526.5 million       1-Mo CDOR + 3.59%          December 9, 2025        Waterfall Asset Management        243,447
CURO Canada Revolving Credit
Facility (1)                          C$10.0 million        Canada Prime Rate +1.95%   On-demand               Royal Bank of Canada                    -

(1) Capacity amounts are denominated in Canadian dollars, while unpaid balances in March 31, 2022 are denominated in WE dollars.

(2) On July 30, 2021, we closed our $750 million aggregate principal amount of new 7.50% Senior Secured Notes, which was used to redeem our $690.0 million
8.25% Senior Secured Notes due 2025. On December 27, 2021, we issued an additional $250.0 million of our 7.50% Senior Secured Notes for a total capacity of
$1.0 billion.



Refer to   Note 5, "Debt,"   for details on each of our credit facilities and
resources.

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Cash flow

The following highlights our treasury activity and sources and uses of funding during the periods indicated (in thousands):

                                                                      Three 

Months ended March, 31st,

                                                                       2022                   2021
Net cash provided by operating activities                        $       83,733          $   110,492
Net cash used in investing activities                                  (187,670)            (163,618)
Net cash provided by (used in) financing activities                     110,322                  (65)



As previously described, year-over-year comparisons were impacted by the impacts of COVID-19 and winding-up portfolios from regulatory changes.

Operational activities

Net cash provided by operating activities for the three months ended March 31,
2022 was $83.7 million, attributable to net income of $1.3 million, the effect
of non-cash reconciling items of $107.5 million, and changes in our operating
assets and liabilities of $25.1 million. Our non-cash reconciling items of
$107.5 million primarily included $97.5 million of provision for losses and $9.8
million of depreciation and amortization. Our changes in operating assets and
liabilities of $25.1 million were primarily related to (i) $41.6 million of
lower accounts payable and accrued liabilities as a result of timing on the
settlement of certain accruals, and (ii) $18.5 million of lower accrued interest
on the 7.50% Senior Secured Notes related to timing of interest payments,
partially offset by $28.5 million of lower accrued interest on our gross loans
receivable.

Investing Activities

Net cash used in investing activities for the three months ended March 31, 2022
was $187.7 million, primarily due to net origination of loans of $176.3 million.
In addition, we used cash to purchase $11.4 million of property, equipment and
software, an increase from last year due to the acquisitions of Flexiti and
Heights Finance.

Fundraising activities

Net cash provided by financing activities for the three months ended March 31,
2022 was $110.3 million. Net cash provided by financing activities included (i)
$111.2 million of net proceeds from our non-recourse debt facilities and (ii)
$20.0 million draw on our Senior Revolver, partially offset by (i) $13.5 million
of share repurchases in the first quarter of 2022 and (ii) $4.8 million of cash
dividends.

Significant Accounting Policies and Estimates

There have been no material changes to the information on critical accounting
estimates described in Part II - Item 7, Management's Discussion and Analysis of
Financial Condition and Results of Operations-Critical Accounting Policies and
Estimates, in our 2021 Form 10-K for the year ended December 31, 2021.

Goodwill. We exercise judgment in evaluating assets for impairment. Goodwill is
tested for impairment annually, or when circumstances arise which could more
likely than not reduce the fair value of a reporting unit below its carrying
value. These tests require comparing carrying values to estimated fair values of
the reporting unit under review.

Our reporting units consist of the U.S., Canada Direct Lending and Canada POS
Lending segments, as defined by FASB's ASC 280, Segment Reporting, for which we
assess goodwill for impairment. As of the most recent annual goodwill impairment
testing date (October 1, 2021), the U.S., Canada Direct Lending, and Canada POS
Lending reporting units' estimated fair values exceeded their carrying value. As
described in our 2021 Form 10-K, an impairment would occur if the carrying
amount of a reporting unit exceeded the fair value of that reporting unit.
Events or circumstances that could indicate an impairment include a significant
change in the business climate, a change in strategic direction, legal factors,
operating performance indicators, a change in the competitive environment, the
sale or disposition of a significant portion of a reporting unit or economic
outlook. These and other macroeconomic factors were considered when performing
the annual test as of October 1, 2021.

For the three months ended March 31, 2022, we reviewed goodwill for triggering
events that would indicate a need for an interim quantitative or qualitative
assessment of goodwill impairment. As a result of the review, no additional
assessment was deemed necessary, and thus there was no goodwill impairment for
any reporting unit.

Uncertainty surrounding macroeconomic factors that could impact our business units continues to exist. Changes in the expected duration of the current economic downturn, timing of recovery or long-term revenue growth or profitability of these reporting units could increase the likelihood of future acquisition. Additionally, changes in market participants

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assumptions such as an increase in the discount rate or further share price reductions could increase the likelihood of future impairment.

The following table summarizes the segment allocation of recorded goodwill on
our unaudited Condensed Consolidated Balance Sheets as of March 31, 2022:
(in thousands)                     March 31, 2022      Percent of Total           December 31, 2021    Percent of Total
U.S.                            $          359,779               83.5  %        $          359,779               83.7  %
Canada Direct Lending (1)                   30,610                7.1  %                    30,105                7.0  %
Canada POS Lending (1)                      40,578                9.4  %                    39,908                9.3  %
Total Goodwill                  $          430,967                              $          429,792
(1) Changes in Goodwill between December 31, 2021 and March 31, 2022 are due to fluctuations in foreign exchange rates.
Refer to   Note 13, "Goodwill"   for additional details.



Regulatory environment and compliance

There have been no significant developments with respect to our regulatory environment and compliance since December 31, 2021as described in our 2021 Form 10-K, except as follows:

CFPB supervisory authority

The CFPB is expanding its supervisory authority using its Dormant Authority
provided for in the Dodd-Frank Act. On April 25, 2022, the CFPB (or "Bureau")
announced that it will begin conducting supervisory examinations of non-bank
financial entities (e.g., FinTechs) not currently subject to supervision and
enforcement, if the Bureau believes the companies may be posing risks to
consumers. The Bureau is also signaling that it may decide to publicly disclose
some of its new supervisory activity so that other entities can be informed of
areas the Bureau finds problematic. In the same announcement, the Bureau
indicated that it is seeking public comments on a procedural rule to make the
examination process more transparent.

CFPB Consumer Reviews

On March 22, 2022, the CFPB issued a compliance bulletin for financial companies
and their service providers warning that restricting consumer reviews, silencing
consumer reviews, pressuring consumers to remove a review, or posting fake
reviews can violate the Consumer Review Fairness Act as well as constitute a
UDAAP.

CFPB Anti-Discrimination

On March 16, 2022, CFPB announced that it was expanding its anti-discrimination
efforts in all consumer finance markets. The announcement clarified that
discrimination can be "unfair" and trigger UDAAP even though the discriminatory
action could be covered under the Equal Credit Opportunity Act or another law.
The CFPB updated its examination procedures manual for UDAAP to examine
decision-making processes for assessing discriminatory risk and outcomes,
including advertising, pricing, and other areas.

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Rosalie M. Dehner