goeasy Ltd.

David Yeilding – Senior Vice President-Finance David Ingram – President and Chief Executive Officer Steve Goertz – Chief Financial Officer, Jason Mullins – Chief Operating Officer

Stephen MacLeod – BMO Capital Markets Jeff Fenwick – Cormark Securities Doug Cooper – Beacon Securities Michael Overvelde – Raymond James

Thank you, operator, and good morning, everyone. Thank you for joining us to discuss GOEASY's results for the first quarter of 2016.

The news release, which was issued yesterday after the close of markets is available on Marketwired and on the goeasy website. Today, David Ingram, GOEASY's President and Chief Executive Officer, will talk about the highlights of the first quarter.

Following his remarks, Steve Goertz, the Company's Chief Financial Officer, will discuss GOEASY’s financial results in greater detail. David Ingram will then provide some insights into our strategic initiatives and outlook before we open the lines for questions from investors.

Jason Mullins, the Company's Chief Operating Officer; and Jason Appel, the Company's SVP of Risks and Analytics, are also on the call. Before we begin I remind you this conference call is open to all investors and is being webcast through the Company's investor website.

All shareholders, analysts and portfolio managers are welcome to ask questions over the phone after management has finished. The operator will hold for questions and provide instructions at the appropriate time.

Business media are welcome to listen to this call and use management's comments in responses to questions and in coverage. However, we would ask that they do not quote callers unless that individual has granted their consent.

Today's discussion may contain forward-looking statements. I'm not going to read the full statement but I will direct you to the caution regarding forward-looking statements included in the MD&A.

Now, I will turn the call over to David Ingram.

Good morning, and thank you for your participation on call today. We had a good start to 2016 with earnings and margin expansion.

We delivered on our commitment to leverage scale through the continued growth of easyfinancial. We maintained our charge off rates within our targeted range of 14% to 16% report in a sequential decline in our loan loss rate from the last quarter.

We also increased the operating margin at easyhome. Before Steve reviews the financial performance for the quarter in detail, I want to touch on some of the highlights for the quarter.

Revenue increased 17%, to reach record levels for the first quarter. We achieved a 49% growth in earnings per share, which increased from $0.35 to $0.52 this quarter.

The strong financial results were driven by both of our business units easyfinancial and easyhome. The Company’s revenue growth was again driven by easyfinancial, as it continued to meet demand by offering customers and alternative between traditional banks and the expensive payday lenders, while responsibly managing risk through industry-leading credit modeling and underwriting practices.

We believe that easyfinancial business model is ideally suited to a flexibly service the borrowing needs of our targeted consumer. Combination of retail branches, a strong online presence and the establishment of point of sale financing through merchant partners maximizes brand recognition and origination.

easyfinancial utilizes a strong central analytics and credit decisioning to make lending decisions that optimize the balance between origination volumes and loan losses. Finally, and most importantly, our national branch network provides a significant competitive advantage while in compare to online lending or so called fintech companies in the near prime and sub prime space.

The establishment of direct personal relationships with customers utilizing our national branch network significantly improves customer engagement, reduces charge offs and leads to superior profitability. easyfinancial’s gross loan originations climbed to $82 million for the quarter, up 35% against the first quarter of 2015 and driven by strong demand for our larger dollar loan products and by the enhancements that we’re made to our transactional website.

During the quarter, we reached two major milestones. First, our total origination since the launch of easyfinancial in 2006 have now exceeded the $1 billion threshold.

Second, our loan book topped the $300 million milestone reaching $304 million by quarters end. The strong origination volume was assisted by our easyfinancial transactional website, which was re-launched in late 2015.

Enhancements to this website improved the customer experience, clarified our value proposition and streamlined the application process. Our investment have had the desired effects with a 48% year-over-year increase in the volume of submitted applications.

And further, 70% of our customers will begin an online application now complete the process compared to only 42% on the old website. With a significant portion of our loan applications beginning online these improved conversion rates will be important for the future growth of our loan book.

In March, we announced the introduction of risk adjusted interest rates and an increase to the maximum loan size of $15,000 for certain eligible customers. The new loan products are designed to reward existing customers with improved credit and attract new ones that our eligible for a lower rate of interest.

Eligibility for our lower interest rates is based on a customer’s credit profile and strong repayment history. We’ve taken a cautious approach to this launch limits in the eligibility for our lower rate products to $0.10 originations by dollar value.

And so the overall impacts on the loan book in the quarter was quite small. Longer-term however, we will be able to reach a broader basic customers by moving up the credit spectrum.

Moreover, we feel strongly that this is the right thing for our customers and it benefits the company by improving customer retention. Ultimately, we are pleased with the financial results with the first quarter, which are in line with our expectations and which we will represents a strong start for 2016.

Now, I’ll turn the call over to Steve to review our financial results for the quarter in greater detail.

Thank you, David. Total revenue for the quarter was $82.3 million, an increase of $11.8 million or 16.7% compared with $70.5 million in the first quarter of 2015.

Same-store sales growth was 14.4%. The growth in revenue was driven primarily by easyfinancial.

To better understand our financial performance, I’ll review each of our business unit separately. With easyfinancial, we continue to experience strong growth of our easyfinancial gross consumer loans receivable portfolio, which finished the quarter at $304 million, up from $207 million at the end of the first quarter of 2015.

This represented an increase of $97 million or 47%. The gross consumer loans receivable portfolio grew by $14.7 million in the quarter.

While the gross consumer loans receivable portfolio grew by 47% over the past 12 months, easyfinancial’s revenue grew by 40% compared with the first quarter of 2015 due to a reduction in the achieved yield. This reduction was attributable to two factors.

First, the company, has seen strong demand for its larger dollar loan products and such loans have reduced pricing on certain ancillary products. Second, the company has experienced increased unemployment claims against its optional loan protection product, which effectively reduces the net commissions earned by the company on these ancillary products.

Our optional loan protection product provides a value safety net for our customers in the event of illness, disability, death or job loss, the insurance policy that underlines the loan protection product makes the required loan payments on the customer’s behalf. While we earn a commission on the sale of this product, the customer claims are netted against our commissions earned and serve to reduce our overall net revenue.

We have recently seen an increase in claims particularly unemployment claims over the past few months in our provinces. Ultimately, this increase in claims rates has contributed to the decline in the yield in the quarter.

For fiscal 2016, we expect the year-over-year yield decline to be approximately 3%. The operating expense of easyfinancial excluding bad debt expense increased by $2.2 million or 16.3% in the current quarter compared with the first quarter of 2015.

Expenses increased due to the expanded branch network including the additional operating cost of the 45 branches acquired and opened during the first quarter of 2015. Increased advertising expenditures to support the larger loan book and higher loan administrative inflection costs resulting from the larger loan book and the greater volume of loan originations.

Expense growth of 16.3% was significantly lower than the revenue growth of 40% resulting in our margin expansion. With our overall branch network largely built out we’re beginning to see this business scale and elevate operating margins.

easyfinancial’s bad debt expense increased to $12.4 million for the first quarter of 2016 from $8.2 million during the first quarter of 2015. Net charge off’s as a percentage of average growth consumer loans receivable on an annualized basis were 15.2% in the quarter, up from 13.8% reported in the first quarter of 2015.

The year-over-year increase was driven by the mix of online originated loans. Such loans have a higher charge off rate than retail originated loans.

The higher charge off rate of online loans is generally offset by lower customer acquisition and servicing costs such that margins between branch and online originated loans are comparable. Additionally, the charge off rate in the first quarter of 2015 was unusually low due to the timing of growth, which occurred in the preceding quarter.

The charge off rate reported for the first quarter of 2016 up 15.2% was down sequentially from the 15.5% reported in the fourth quarter of 2015. This reduction was achieved through both the tightening of our credit underwriting models during 2015 and improved execution of our collection practices.

We continue to expect that the net charge off rate will be in the range of 14% to 16% for the balance of 2016. easyfinancial’s operating income was $15.7 million in the first quarter of 2016 compared to $9.7 million in the first quarter of 2015, an increase of $6 million or 61.4%.

Operating margin for the quarter was 34.9% compared with the 30.2% reported in the first quarter of 2015. Our leasing business generated $37.3 million in revenue, a decrease of $1 million when compared with the first quarter of 2015.

Organic revenue growth across our store network was flat for the total revenue declined due to store transactions over the past 15 months and the deconsolidation of various U.S. franchises.

The operating income for the leasing business was $6.4 million for the quarter, up $400,000 or 6.7% when compared to the first quarter of 2015. While revenue declined in the quarter when compared to the first quarter of 2015, operating income was positively impacted by expense efficiencies from a lower store count and reduced advertising.

Similarly, operating margin for the first quarter of 2016 improved to 17.1%, up from 15.6% reported in the first quarter of 2015. Overall operating income for the quarter was $14.8 million compared to operating income of $9.8 million in the first quarter of 2015, an increase of $5 million or 50.9%.

Overall operating margin for the quarter was 17.9%, up from the 13.9% reported in the first quarter of 2015. The improvement in operating margin was driven by higher operating margins from both businesses and a larger percentage of our earnings generated by the higher margin easyfinancial business.

Improved operating income translated into improvements in net income and earnings per share for the quarter. Diluted EPS increased to $0.52 from $0.35 in the prior period an improvement of almost 50%.

Finally, our overall financial position remains strong at March 31. $230 million was drawn upon our $300 million committed credit facility leaving sufficient capacity to fund the expected growth into 2017.

At March 31, 2016, the Company’s ratio of external debt to total captaiblization was 0.55. Now will turn the call back to David.

Thanks, Steve. It continues to be a challenging and uncertain time for the Canadian economy, where the price of oil and the Canadian dollar have rebounded somewhat in recent weeks.

Frictional unemployment levels remain elevated in some areas and workers are reliant, sorry, workers reliant in the oil sector transition to new careers. The Bank of Canada is cautiously optimistic calling for recovery later in 2016.

We believe our business has performed well during these trying times. Our disciplined credit underwriting and robust collection practices have allowed us to maintain charge off rates within our desired range.

Our loan protection plan as Steve discussed earlier has provided a much needed safety net for our customers. Cushioning the blow of job loss for them and reducing the impact of the challenging economic situation on charge off rates for our company.

Our plan is working and we’ll continue on the same strategic path by expanding the size and scope of easyfinancial evolving our delivery channels to better meet the needs of our customers and executing with efficiency and effectiveness. During the quarter, we announced an exciting point of self financing venture with Sears Canada, while we are still working through many of the details of this partnership, we will develop the industry’s first single source application system for point of sale financing across all customers in the credit spectrum.

Essentially this tablet based and proprietary application system will allow a customer to complete a single credit application and provide the best possible financing solution for that customer. Once the new customer credit application process has been put in place, Sears will provide the capital to finance the prime loans, while we will finance loans that do not meet Sears prime lending criteria, but which meet our own lending criteria.

We will use our existing people, processes and infrastructure to manage administer and collect all loans originated under the program including the loans funded by Sears under our full cost recovery structure. We look forward to Sears and their customers and obtaining purchase financing and in our ability to leverage this industry-leading and proprietary technology with other business partners.

Over the past several years, we’ve invested heavily in credit risk and analytics. We will continue to optimize that credit risk management expertise and collection practices.

Our goal as always is to balance the competing objectives of growth with loss mitigation, overall optimizing the bottomline. We feel that the changes made in our credit underwriting policies over the last 18 months have had the desired effect and we have seen charge off rates improve sequentially without unduly impacting loan originations.

We continue to see loss rates tracking within our optimal range of 14% to 16%. So we remain confident in our ability to achieve our stated 2016 targets.

Loan book growth in the quarter was on track to achieve our year-end target of $360 million to $390 million. Our revenue growth in the quarter of 17% was consistent with our stated 2016 revenue growth target of 16% to 20%, while easyfinancial’s operating margin in the quarter of 35% was at the top end of our targeted range for 2016.

We are firmly off to a strong start in 2016. The trajectory of our business is as expected and in line with our stated target.

We continue to be confident in our ability to meet our goals and achieve record revenue and record profitability for 2016. With our formal comments complete, we will now open it up for questions.

Thank you, good morning.

Good morning, Stephen.

Hi, Stephen.

I just wanted to just ask a couple of questions on the easyfinancial business particularly some of the metrics in the first quarter. And kind of how you see that evolving through the years, so specifically I just wanted to talk about the yield that you saw in the quarter, which was a little bit lower than what I would have expected.

And then you talked about your target for net charge off’s. But I just wanted to see how that 14% to 16% range compares to what you would expect to report at as a bad debt expenses as a percent of revenue for the year.

Yes, it’s Steve here. I’ll talk about the yield.

The yield within easyfinancial did come off a little bit in the first quarter. We have seen declines throughout 2015 really driven by the shift and mix towards larger dollar loans, which carry a lower total net revenue from the sale of ancillary products.

So that trend has continued a little bit into 2016, which has taken yield down a little bit. On top of that, the claims against our LPP, our loan protection program have increased in the first quarter, particularly due to unemployment claims made by customers.

The way that program works if we put some of the proceeds from the customers into a claims pool any surplus from that claims pool are refunded back to us, because the claims rate has increased that refund back to us has been slightly decreased, so what’s impacting our overall yield. There is one other item impacting yield in the quarter and it’s really unique to the first quarter of this year given the timing of the year-end.

We received certain revenue for the sale of ancillary products in the last week of December. And as a result there was one last pay period where we received that revenue in the first quarter of 2016.

So that had a onetime impact of slightly reducing yields in the first quarter.

Okay. And so would you expect to – how do you expect the yields to trend through the year like you should be back at that 5.3% to 5.4% for month level.

Yes. We – over the course of the year, our yield last year was about 64% or so.

We’d expect it to continue to decline by about 300 basis points. So the total yield for the full year be about 61.

Okay. Okay, that’s great.

And then on the bad debt, so…

I’ll turn over to Jason on the bad debt side.

Sure. Yes, so I think your question was particularly relative to the bad debt as a percentage of revenue.

So as I said, as Steve said earlier the loss rates stabilizing within our target range of 14% to 16% will mean that you will see a similar trend of bad debt to revenue as we saw in Q1. Q1 came in around 27%.

I would expect that that will be roughly the same rate to revenue in the next couple of quarters.

Okay. Okay, that’s great.

Thank you. And then just thinking on easyfinancial like the store it seems like you’ve added a lot of new stores in the first quarter.

So I thought the commentary at Q4 was that it would be more linear through the quarters, so given that your net new store count was up seven I guess in Q1, would you expect the new store activity to be sort of muted through the back last few quarters of the year.

Yes, that’s right. It ended up being a little bit more front-end weighted than initially planned, we took advantage of some relocation opportunities from key off to standalones that became available.

So we will still be within the same target range we had initially provided. And so you will see the growth slow on a quarter-by-quarter basis in terms of store openings and we’ll still finish where we initially targeted.

Okay, great. And then just one final question, excuse me, on the leasing side, the margins were quite strong in the quarter and sort of tracking about where I thought it would come out for 2016 obviously or early, early stages, but do you expect kind of the impacts that hit the quarter in – that hit the numbers in Q1 to continue through the rest of the year specifically I guess the lower ad spend.

Yes, Stephen, if you look the whole ad spend for the full year across those businesses. We spent around $10.6 million last year, of which $5 million was on leasing.

We’re expecting to spend about $13.5 million in total in 2016 and around $4.2 million in the leasing business, so leasing will probably come in around $700,000 to $800,000 lower year-on-year. As we spend most of the TV properties and digital properties on easyfinancial.

Okay, that’s helpful. Okay, back in line.

Thank you very much.

Thanks.

Hi, good morning, everybody. I just wanted to follow-up on the insurance product a little bit here in terms of the mechanics of how it works and maybe Steve, can you just explain, is that insurance covering the full amount of that loan when someone is unemployed or is it just a period of time where they are covering the payments and then they are back on the hook for paying it in and surely within the contacts I guess of the potential for charge offs to arrive later on.

Yes. The way that program works is, the customer pays the insurance fee and it’s paid as the payments are made not as an amount added to their loan balance.

So the customer can cancel it at anytime and we’re not there at risk of a higher charge off as we had to fund that entire program. But when the customer makes a payment, we keep a portion as commissions, a portion goes to the providers for their servicing fees and for their risk and then a portion goes into a loss pool.

If that loss pool is not fully exhausted for a period, we get a rebate back to us. So that improves our yield and improves our margin.

As claims increase that rebate back to us gets reduced somewhat. From the customers perspective, once they can show they’ve either had an illness or their unemployed.

The insurance policy begins making their loan payments and it will do so for a period of up to six months. At the end of that six months period, if they are still unemployed, it will make lump sum payment of up to $2000 against their outstanding loan balance.

If there is any loan balance still remaining at that point in time, then the customer is responsible for starting to make his loan payments personally once again.

And in the – I guess in the context with how you are providing for that type of losses, this is something that you are taking in as bad debt expense at a time and meeting the some risk of future loss down the road here. I guess my concern is we don’t capture the potential ultimate loss until this is built out for a while that six months period expires and then the ultimately default on the loan.

Well, I’m going to add two things. First, the customers’ eligible to have the insurance policy make his loan payments, if we becomes unemployed.

That’s what the program is in place for. That doesn’t necessarily mean the customer wouldn’t make his loan payments himself if he was unemployed and didn’t have the insurance product.

We don’t know what that would be, but as it relates to losses, those loans are still performing, so there is no provision necessary specifically against them. However our overall loss provision is based on the performance of our book over a period of time including those customers who did have loan payments made for them by the insurance product and then at the end of the period may have charged off.

So implicitly through our bad debt provisioning we have provided for any expected losses in those types of situations.

Okay. And let’s move on maybe to loan growth here, this is one of the – I mean the lowest quarters in terms of net additions that we’ve seen a little while, just wondering what was the play here, I know you’ve made some changes in the underwriting focus and the product little bit in terms of making the loans larger.

And I know there can be a bit of seasonality applied, so what was going on for Q1 that had that number a little bit lower than you might have seen now over the last few quarters.

Yes, so it’s largely seasonality if you look at the trend of the loan growth for prior periods and calculate Q1’s contribution that are over the full year period is not dissimilar to what we’re seeing this year versus what our ending loan book guidance would be. So if you look at our ending loan book guidance at $360 to $390.

The absolute loan dollar growth using the average midpoint would be just slightly less than the absolute dollar growth from last year and that’s really what we an absolute basis in Q1’s as well.

And then a question here just on corporate expenses, they didn’t move up pretty meaningfully sequentially here, is Q1 indicative of what we should expect as a run rate over the year where there are some more items in the first quarter.

There were some onetime items for some salary transition cost as some changes were made here at the corporate office, and there were some professional fees going in, so it’s slightly higher than we’d normally see.

And then just you spoke about the Sears opportunity here and you had, you rolled [indiscernible] over the course of last year. Any sort of, outlook you can give us around what we should be expecting and how that product is going to rollout and maybe an update on [indiscernible] as well in terms of how meaningful the contribution is through 2016 and heading into next year.

Jeff, it’s Steve. I can comment on that.

So our – if I look at just our overall indirect partnership channel. We don’t break it down by the individual partnership to sales, but that overall channel continues to scale still, it’s still fairly small contribution in the quarterly represented about 9% of our loan applications.

And between 2% and 3% of the loans we originated. So and that’s versus of course last year we would have been almost zero, so continues to make good progress, we still have the very positive outlook.

As for Sears in particular it’s going to be a number of months before we’re in a position to be able to actually begin originating loans with them. So there is multiple months of integration and configuration before we’re originating loans on their behalf of the prime program and then that being from our prime business.

So it would be too early to really provide any real outlook as to what that contribution is going to be in 2016.

Okay, great. I appreciate the color.

I will re-queue thanks.

Hi, good morning, guys. I just wanted to focus on a couple of things, one, you talked about the yields down, obviously the salaries are down, and you are targeting a client base, presumably has a bit of higher credit track record.

So these earnings would you classify these as higher quality earnings with less of salaries and maybe turning towards higher credit quality client.

If you look at the yield on the portfolio has come off, the net profit per customer has increased, because we’re giving greater dollar amounts to a lower risked customer. So that will help with the lifetime value for that customer, because they got bigger dollar loans that are on the book, longer time with lower cost to administer them.

Overall, quality of the customer. Jason?

Yes, we haven’t really seen any material change. Yes, we see small fluctuations in the average score of the consumer coming through the door and that being generally positive but we do use custom scores that don’t rely purely on that generic scores.

So those custom scores make a balance of our fund decisions.

Right. I guess I’m just looking at the year-over-year increase in the interest revenue was 49%, year-over-year interest increase in other revenues were 17.5%, is that you talked obviously about the insurance some of the claims against that so, is that trend we should see continuing like a percentage of revenue from easyfinancial’s more interest driven than other driven.

Yes, you will see that generally over and I’ve spent a period of time anyway, because some of those ancillary revenues are for products that you only generate onetime. So for example, if you sell the customary prepaid reloadable master card that they use to receive the proceeds of their loan and there is a cost to purchase that card, which you would only occur onetime where as the interest and the insurance revenues are ongoing and associate selectable loans.

So overtime the revenues associated those onetime sales as a percentage of your book or in our yield would slowly reduce.

Correct, and I guess…

Sorry, just to focus on a couple of areas, because we’ve heard in the last few questions, for this loss prevention claim, I mean the product is clearly doing what it was intend to do which is to give people the opportunity to use it by being paying for it and in a way, it helps stabilize the loss rates, because its ensuring that they can make good on these payments. But we’ve seen somewhat a bit of a crest in the last quarter or so, in terms where those last claims are coming to and we’ve seen record low delinquency rates coming out this last weekend of trading.

So the opportunity for us is to start to see a little bit less an improvement to the loss rates moving forward. So we’re hopeful for that.

And we think we’re in a crest in terms of some of the claim rates, so I don’t think you will see the acceleration from that. So those two things should help despite the fact that we’ve said that the yield may drop by 3 percentage points.

There is an opportunity to try to improve upon that. If we see that we have in fact seen the crest of the claims and we’re starting to see a better trend in terms of loss rates.

Great.

Doug, it’s Steve here again one other point I wanted to make when you are looking at the other revenue line on the income statement only growing by 17% that also includes some of the ancillary revenue from the leasing business and franchise fees of that mitigates the growth in that. The actual increase in any ancillary fees on easyfinancial were down a little bit lower than the rate of increase on interest rate, but not dramatically lower.

I guess my last question I just wanted on a trailing 12-month basis your GAAP earnings to the period of in December was a $1.76. And for the period ended March was $1.93, so you grew that 10%.

And you’ve seen the stock drop on a PE basis on a trailing 12-month from a 11% to now trading about 9%, so 200, are twofold base, our twofold multiple points lower. This is something that must be frustrating for a Company with record results in your evaluation keeps dropping per about 18 months straight.

Is there a plan with the company to address this?

I mean it’s hot, it is frustrating and it is hot to anymore I think than what we’re being doing, which is try to communicate at a very transparent way both in our written documentation on the business. And also when we’ve been out meeting portfolio managers and investors that clearly is a bit of a sector decline.

So when we look at benchmark companies like world acceptance, the other public company, fintech company here [indiscernible] and we look at some of the others, they have seen much bigger declines over that same 12-month period. So there is a bit of a sector negative influence to this.

I think from our perspective the way that we look at this is we have got a normal course issuer bid in place. We haven’t used it in the early months of the year.

We will continue to use it, if the share price stays value to these ranges. We will continue to increase the dividends.

We have set, we have continued to look at on an annual basis and see if we kind afford to pay them 30% on trading earnings. So with these earnings going up, you’ll continued dividend increases.

So I think with that everything we can do, but we’re about in a bit of headwind in terms of the sector confidence and I think the management we focus on earnings and execution and we’ll deliver on the targets and we’ll continue to deliver on the targets.

Okay, thanks, gentlemen.

Thanks. Guys just interested maybe a little bit more color on the new risk adjusted at a lower interest rate product that you launched just in March.

In terms of what you are early experience has been in terms of take up new clients versus existing clients maybe moving to the lower yield product maybe start with that.

Yes. Hi Michael, it’s Jason.

We’ve been on the market now just over two months. We’ve seen about an equal split about new customers and existing customers that have taken a step on the larger dollar loans that the company in the lower rates.

We’re very encouraged by the fact that given the fact that we’ve often decelerates that the average size of a loans that we’re often on these customers about double what we typically see across the book. And not only got the loans bigger, but they are funding in less time and they are generally getting approved more often compared to our average customer.

So we’re quite pleased albeit we’re two months in. The other two metrics obviously that are going to really play out with time are going to be the average tenure these customers how they stick to these loans.

And obviously the loss performance as again we’re still in early days is very difficult to measure the loss. So the delinquency trends on this grouping of customer this quite favorable, because as you would expect we’re only offering these lower rates to better quality customer.

So initial out of the gate that’s – are quite encouraging. We track the data monthly, but we expected will need several months of analysis to be able to come back to the cupidity with more of a formal outline and how we’re doing.

So I guess on the timeline, I think David mentioned in his remarks, you were limiting that product to about 10% of originations. Like is that imply you’ve actually had some surplus demand, you sort of holding back on promoting it.

And so you get comfortable with where these metrics are trending in that this might contribute to call an acceleration of loan growth once you get to that point.

Yes, that would be correct.

All right, thanks. Actually one quick follow-up on the easyhome business, just noticing with the average level of assets as well as revenues per store in declining a little bit in the quarter, I guess we saw couple stores of followed at a store count, but on a per store basis bit of a decline how would you expect that to trend going forward, normally think of this is being somewhat of a flattish business maybe little bit increase with inflation, maybe as you close some stores, you consolidate, merchandise such that we should see a bit of an increasing trend.

So it’s a little bit surprise to see a decline. Is that going to decline further or kind of hold steady from here?

It should hold steady that may increase a little bit, a couple of things that happened there. As we closed in more merge stores, we’ve reduced the merchandise that’s on hand with – in stop within our retail locations.

So that has the impact of driving down that number. There is a big large portion of though that’s also due to timing of promotional events.

If we’ve got a – lastly we’ve got a large promotional event right at the end of March, which means our stores with full of inventory. This year that promotional event didn’t happen until April, which means our inventory levels were a little bit lower, because we haven’t yet feel the stores that for that event.

So in total, yes, it’s dropped a little bit, it’s likely to go backup, somewhat, but year-over-year we look trends down a little bit on the total leased asset inventory.

All right. Thanks guys.

Hi guys, I just wanted to see what percent of your gross loan receivables, is that currently getting paid by the credit insurance – covered under the credit insurance.

So the question is what percent of the payments we received or the portfolio.

No. In terms of the actual portfolio how much of that or what percent of that is currently covered by of the credit insurance payments that you are receiving.

That’s kind of number that we’ve disclosed in the past. It doesn’t represented significant portion of our portfolio, but it is not something that we disclose for competitive reasons.

Okay. And then though the question two, when I look at your guys the financial covenants, you are getting awfullyclose to the debt tangible network covenants, it looks like only at 7% question.

I mean how should I build in your growth assumptions as well as the ability to potentially buyback stack or pay dividend one when you gather in close to potentially based on the covenants as they are some sort of game plan and place any color on that would be great.

I wouldn’t agree that we’re close to breaching our covenants. As we state in the financial statements, our covenants move in lock step with our financial targets and our budget.

So each quarter, you will notice there are changes to our covenant levels. So as our performance moves up or as our balance sheet changes or our leverage ratio changes, our – as long as they move in accordance with our plan, the covenants move in lock step.

So we have no [indiscernible]about our covenants. We’ve got a strong relationship with our lender and we’ve got ample head room under our covenants to fully drop upon those facilities when that cash is required.

Okay, that’s great. As you know, when you look at the debt to networks [indiscernible], just a little bit worried about the dividend, but seems like you guys have a plan for it so, good luck.

Okay, thank you.

Once again I want to thank everyone for their participation and support on the company. And as it is our AGM today, I look forward to meet you many of you at 2 o’clock this afternoon and update in the rest of you three months from now, so thank you.