Freedom Financial Group posts 1Q loss

Springfield-based consumer finance company Freedom Financial Group Inc. posted a first-quarter loss on a higher loan-loss provision, the company reported Tuesday.

Freedom Financial, which specializes in acquiring and serving subprime auto loans, had a $292,608 net loss in the first quarter, compared to a $174,329 loss in the same quarter last year.

Revenue was up 52.9 percent from a year ago, and operating expenses were down 5.4 percent, according to a company news release. The loan-loss provision, however, increased by $315,000 in the quarter and "reflects potential risk in the present economy," the release said.

"... While demand remains strong, the uncertainties surrounding rising unemployment and a lack of available credit for auto dealers and finance companies may remain significant throughout 2009 and could restrict revenue growth compared to previously expected levels," officials said in the release.

Delinquencies were down to 2.63 percent in the quarter, compared to 4.37 percent a year ago. Net charge-offs were at 6.92 percent at the end of the quarter, compared to 7.71 percent a year ago.

Freedom Financial's loss comes after a $303,000 profit in 2008 - the company's first profitable year since emerging from bankruptcy in 2003.

Shares (OTC: FFGR) closed Tuesday at 7 cents, at the bottom of its 52-week range of 7 cents to 15 cents.[[In-content Ad]]