Good morning, and thank you for holding. Welcome to Conn's, Inc. Conference Call to discuss the Earnings for the Quarter and Fiscal Year Ended January 31, 2016. My name is Jonathan, and I will be your operator today. [Operator Instructions] As a reminder, this conference call is being recorded. The company's earnings release dated March 29, 2016, distributed before the market opened this morning and slides, that will be referenced during today's conference call, can be accessed via the company's Investor Relations website at ir.conns.com. I must remind you that some of the statements made in this call are forward-looking statements within the meanings of the Securities and Exchange Act of 1934. These forward-looking statements represent the company's present expectations or beliefs concerning future events. The company cautions that such statements are necessarily based on certain assumptions, which are subject to risks and uncertainties, which could cause actual results to differ materially from those indicated today. Your speakers today are Norm Miller, the company's CEO; Mike Poppe, the company's COO; and Tom Moran, the company's CFO. I would now like to turn the conference call over to Mr. Miller. Please go ahead, sir.

Good morning, and welcome to Conn's Fourth Quarter Fiscal 2016 Earnings Conference Call. I'll begin the call with an overview, and then Mike Poppe will discuss our retail and credit performance for the quarter. Tom Moran will complete our prepared remarks with additional comments on the financial results and our balance sheet. The key points of my comments are highlighted on Slide 2 in the earnings call slide. Since becoming CEO in September 2015, I've been fully involved with our operations. I visited a number of our stores, distribution centers as well as our call centers. I've interacted with many of our employees, vendors, lenders and shareholders. As I engage with our different stakeholders, I find that I am increasingly confident in our differentiated business model, our growth opportunities, and most importantly, the value we provide our customers. Conn's has a significant market opportunity, which we believe will allow us ultimately to become a national retailer. The company's key initiatives are centered around our commitment to executing on this differentiated business model, which delivers unique value to our customers. As a result, we are building the foundation to support not only fiscal 2017's growth, but also our long-term plan. Fiscal 2016 was a challenging year. We were not satisfied with the financial results we issued this morning. However, the company continues to produce strong adjusted EBITDA results, delivering nearly $150 million during fiscal '16, consistent with the prior year's performance. We continue to work our way through the significant growth in new customers we attracted during fiscal 2014 to fiscal 2015. The year-over-year improvements in our 60-plus day delinquency rate have been slow to develop. I share and our shareholders frustrations as we expected to see more rapid improvement this year, but as we have stated in the past, growth in our portfolio has slowed, masking the underlying improving trend. Despite fiscal 2016's decline in profitability, I am encouraged with the direction we are headed. We are working hard to produce consistent and predictable earnings. We've learned valuable lessons about managing risk while going our brand with new customers. I am pleased Conn's has successfully reentered the ABS market and most recently completed a rated transaction, our first since 2012. We have developed a plan that will put Conn's back on a path to sustainable, long-term profitability and growth in the coming quarters. I'd like to use my portion of this morning's call to discuss the decisions and strategies we are implementing to not only improve our recent performance, but also position Conn's for long-term success. We have a strong retail strategy and continue to execute against our plan. In the fourth quarter of fiscal 2016, the retail segment expanded with new store growth, successfully opening 2 new stores, bringing the total for the year to 15 stores. Our stores have robust economics, typically achieving 4-wall EBITDA payback in 6 months or less. Retail gross margin improved 40 basis points year over year to 36.1%. Same-store sales, excluding the impact of our Street strategic decision, to exit video game products, digital cameras and certain tablets were up 3.6%. Our strategy to drive the Furniture and Mattress business is continuing to pay off with increased sales in these categories and benefiting retail gross margins on the sales mix shift. We continue to believe 45% of our products sales can ultimately come from Furniture and Mattresses and we are making progress towards this goal. For fiscal 2016, Furniture and Mattress sales increased by almost 21% and represented 31% of our total sales. To implement our successful retail strategy on a national level, Conn's needs a scalable infrastructure to support its growth. Over the past 2 years, we have enhanced our store layout, merchandising and marketing strategies, distribution network, collection systems, compliance organization and access to capital. During fiscal 2017, we will continue making improvements to additional strategic investments in IT, credit and people. We expect to leverage these additional expansion -- expenses to improve performance execution and gross margins. Before I review some of our main operating initiatives for fiscal 2017, I'd like to put our recent growth in perspective. In just 3 years, Conn's has expanded from 68 stores in only 3 states to 103 stores in 12 states. The portfolio has more than doubled in size as revenues have grown 86.5% from $865 million in fiscal 2013 to over $1.6 billion at the end of fiscal 2016. To appropriately manage an increasingly large and complex organization, we are upgrading our IT infrastructure and are enhancing our data analytics capability. The company has hired and integrated a number of key executives and enhanced talent at all levels of the organization to help support growth. During the upcoming year, we will continue to invest in attracting and retaining quality talent in all areas of the business, including expanding our credit risk team. Over the past few years, we have proactively updated our underwriting policies and we'll continue to make appropriate adjustments to manage risk, as a result of changes in the economy, customer behavior, the regulatory environment and our business. Since much of our future growth is reliant on new customers, we have to ensure we are assessing credit risk appropriately. In the fourth quarter of fiscal 2016, we implemented the first phase of our early pay default scoring model. While early indications are positive, we need more time to ensure the changes are delivering the expected results. We are also making additional enhancements during the fiscal 2017's first quarter to reduce the credit risk, specifically related to new customers. We are also optimizing our underwriting model and have identified opportunities that will increase originations to some existing customers. We expect a moderate effect on sales as a result of these changes as well as those we implemented during the fourth quarter. Additionally, we have implemented changes to our no-interest programs to improve portfolio yield and returns on capital. All long-term, no-interest programs are being offered through Synchrony as of early February. We do not expect this change to have a significant impact on profitability, but it will improve returns on capital as we recapture the capital invested in similar accounts on our books today. Additionally, we are removing no-interest program eligibility for certain higher risk customers. We are not anticipating a meaningful impact on sales, as a result of these changes. Over time, though, we expect these changes will improve our yield by approximately 150 basis points. Credit is a fundamental part of our business model. We know we must improve our performance in this segment and maintain an appropriate balance between retail growth and credit risk. While we focus on executing the initiatives I have discussed, we will reduce our store opening plan this year to 10 to 15 new stores with long-term expectation to grow revenues, 10% to 15% per year. Finally, the company continues to add many talented individuals to the organization. We've grown our employee base by 66% over the past 3 years. We will continue to add dedicated associates as well as motivated leaders to execute our plan. Conn's associates are one of our most valuable assets. I'd like to thank all of them for their hard work and dedication day in and day out. Let me conclude my prepared remarks by saying we are focused on moving forward to capitalize on our long-term potential. We have created a path forward that positions us to execute our growth strategies, while reducing risk and enhancing shareholder value. I will now turn the call over to Mike.

Thank you, Norm. Starting with our retail performance, same-store sales, excluding the exited product categories were up 3.6% for the quarter, driven by Furniture and Mattresses. Strength in Furniture and Mattresses is partially offset by softness in Home Appliance and Consumer Electronic sales. As we show on Slide 3 of the earnings deck, total sales growth for the quarter was driven by Furniture and Mattresses, up 28% and Home Appliances up 5%. These are our 2 highest margin and best credit quality product categories. In addition, sales of repair service agreements were up 24% due to increased product sales, mix driven higher average selling price of these agreements, and increased retrospective commissions. On the other hand, we experienced sales declines from categories, where we made the strategic decision to exit certain products, including tablets, which are part of Home Office and video game products and digital cameras, which are part of Consumer Electronics. Same-store sales for fiscal '16 were up 0.5%, in line with our full year guidance. Retail gross margin increased over the prior year due primarily to the increased proportion of sales from repair service agreements. Slide 4 in the presentation recaps product gross margins, which were down 60 basis points as a percentage of product revenue. This was driven by margin rate declines in Furniture and Mattresses and Home Appliances. These declines were due primarily to investments in price to drive volume and exit low performing, lower-priced furniture products and some one-time inventory handling costs, partially offset by the favorable product sales mix shift toward higher margin furniture mattress category. Consumer Electronics' margin rates improved during the quarter, benefiting from a sales mix shift to higher end TVs, which deliver better margins and the elimination of low-margin gaming equipment and digital cameras. From a marketing perspective, we continue to invest in digital marketing, including testing new e-mail campaigns. Additionally, given the volume of direct mail we have sent over the past couple of years, we are completing additional analysis and testing to improve the effectiveness and efficiency of our programs to ensure we are allocating our marketing spend properly. Inventory increased year over year. We expanded our assortment and in-stock levels for furniture and opened new stores. We significantly reduced inventory levels during the fourth quarter compared to the end of the third quarter, and are comfortable that our sales and purchasing plans will bring inventory in line in early fiscal 2017 without impacting margins. During the past quarter, we opened 2 new stores in our Tulsa and Albuquerque markets. We have opened 3 new stores so far in the first quarter to kick off our plan to open 10 to 15 new stores this year. On Slide 5 is the average FICO scores portfolio for the last 4 years. The portfolio has been in a narrow range of credit stores and remained there last quarter. The FICO score of all originations in Q4 fiscal '16 was 614 compared to 611 in Q4 of the prior year. As Norm noted, during the fourth quarter, we began implementing our newly early pay default model and changes to thin file customer underwriting. We are in the process of completing our updated origination scoring model and strategy. We expect to test the new model and strategy during April before completing the implementation. In late March and early April, we are making adjustments to our origination policies. We have identified opportunities to reduce risk, primarily related to new customers. Changes will result in modifying our credit limits, down payments and cash option eligibility to reduce risk for some customers while declining other unprofitable customers. Additionally, we have identified some profitable segments of existing customers with FICO scores over 500 that we will start approving. The combined impact of these and the fourth quarter changes is expected to reduce sales around 4%. The goal of our ongoing underwriting analysis is to provide enhanced segmentation of the application population to allow us to more precisely isolate low performing segments of the population and identify additional pockets of profitable customers to approve. We will continue to monitor portfolio performance and make prudent underwriting adjustments when appropriate. Portfolio delinquency continues to show stabilization. Slower portfolio growth is benefiting the underlying performance of the portfolio, but has a negative effect on the reported delinquency and charge-off rates. First quarter of fiscal '17 delinquency is expected to decrease seasonally. February, greater than 60-day delinquency was down from January to 9.3%. The portfolio had grown at the same pace as it did in the prior year. The 60-plus delinquency rate would have been at least 20 basis points lower than reported for February. While still higher than a year ago, slide 6 shows that the existing customer mix trend and originations have flattened out. It is important to note that we typically see an increase in repeat customer transactions during the fourth quarter. Looking at net charge-off performance, the rate for the quarter was higher than the prior year, due largely to the slower portfolio growth, which impacted the charge-off rate by about 80 basis points. We remain focused on delivering outstanding value and a great experience to our customers by continuing to improve execution in our retail and credit operations. Now, I'll turn the call over to Tom Moran. Tom?

Thanks, Mike. Adjusted diluted earnings for the 3 months ended January 31, 2016, were $0.11 per share. This excluded net charges of $3.9 million or $0.08 per diluted share on an after-tax basis, from a sales tax auto reserve, legal and professional fees related to the exploration of our strategic alternatives and securities-related litigation. For the retail segment of the business, total revenues for the fourth quarter and fiscal 2016 were $376.9 million, which was an increase of 2. -- $25.3 million or 7.2% versus the same quarter a year ago. This growth reflects the impact of a net addition of 13 stores over a year ago with negative same-store sales of 1.7%, including the impact of the exited product categories. We want to call your attention to a change we made during the fourth quarter of fiscal year 2016 in our accounting presentation for delivery, transportation and handling costs. Under the new method, these costs are included in cost of goods sold, whereas, previously they were presented separately as an operating expense. We believe that including these expenses in cost of goods sold, better reflects the cost of generating the related revenue and results in more meaningful presentation of retail gross margin. This change also enhances the comparability of our financial statements with many of our industry peers. We have also revised our retail gross margin calculation to include service revenues as well as cost of service sold. We've applied both of these changes retrospectively. Retail gross margins improved by 40 basis points versus prior year to 36.1%. This improvement was driven by the impact of repair service agreements, which benefited from higher retro or back-end payments as well as higher average selling price on the front end due to mix. Our long-term retail gross margin goal on the revised basis of presentation is 39%. We have continued delivering year-over-year improvements and this goal is achievable considering the following: our increasing sales of furniture and mattress, which have a higher margin; our decreasing share of revenues from a lower margin, small electronics and home office and improving warehouse utilization. Slide 7 of the earnings presentation shows retail cost and expenses. Starting with the top row, we show the cost of goods, including warehousing and the occupancy costs, leveraged by 20 basis points as a percentage of total revenue declining to 63.8%. This improvement resulted from the drivers as we just discussed for retail gross margins. Retail SG&A was 23.2% for the quarter compared to 22.9% for the same period a year ago. The 30-basis-point increase was driven by the impact of new store openings, which drove the 40-basis-point increase in occupancy and contributed to the 40-basis-point increase in advertising. Those increases were partially offset by a 30-basis-point decline in compensation and benefits on store payroll leverage. Taking a look at the credit segment, finance charges and other revenues were $79.9 million for Q4 of fiscal 2016, up $4.8 million or 6.4% versus Q4 of last year. This was driven by a 17.6% increase in the average balance of the portfolio, partly offset by a decline in interest income and fee yield. Drivers of that decline included first: the introduction of 18 to 24 month equal payment, no-interest finance programs, beginning in October of 2014 to certain higher credit quality borrowers; second, a higher provision for uncollectible interest; and third, our discontinuation of charging customer certain payment fees. SG&A expense in the credit segment for the quarter grew 22.5% versus the same period last year, driven by the addition of collections personnel for 17.6% year-over-year increase in the average customer portfolio balance, together with anticipated near-term portfolio growth. Credit SG&A, as a percentage of average total customer portfolio balance, delevered by 30 basis points versus last year. Provision for bad debts for the 3 months ended January 31, 2016, was $64.5 million, an increase of $6.4 million from the same, prior year period. Key factors in determining the provisions for bad debts included the following: first, the 17.6% increase in the average receivable portfolio balance, a 5.4% increase in the balances originated during the quarter compared to the prior quarter; an increase of 20 basis points in the percentage of customer accounts receivable balances greater than 60 days delinquents to 9.9% at January 31, 2016, as compared to the prior year period; and the balance of customer receivables accounted for as troubled restructurings increased to $117.7 million or 7.4% of the total portfolio balance. As a result of these factors, the provision for bad debt as a percentage of the average portfolio balance was 16.6% compared to 17.6% in the fourth quarter of last year. For the fiscal 2016 fourth quarter, interest expense increased by $14.5 million year over year, driven largely by our reentry into the ABS market, which increased the average debt balance outstanding and contributed to an increase in the effective interest rate. For the quarter, interest expense as a percentage of the average portfolio balance was 6.2% with average debt as a percentage of the average portfolio balance of approximately 77%. We view the higher borrowing costs associated with our ABS transaction as a temporary cost of reentry into this market. This will give us a more diversified capital structure to support the growth of our business. As we become a repeat ABS issuer with an established performance record, we expect that our borrowing costs in these transactions will improve in the future as they have for other companies that have access to this market. Turning now to balance sheet and liquidity, inventory was up 27% to last year, an increase year over year as we expanded our assortment and in-stock levels for Furniture and the product mix shift over to Furniture, which has slower turns as well as the impact of new store openings. As Norm touched on earlier in the call, last week, we closed another securitization transaction announced on March 14, 2016. We issued 2 classes of asset -- of rated asset back fixed-rate notes with the Class A notes rated as investment grade by Fitch. The face amount of the notes issued was approximately $494 million on an aggregated outstanding customer receivables portfolio balance of $705 million. We received upfront proceeds of approximately $478 million, net of transaction cost and reserves. The notes have an all-in cost of funds of approximately 7.8%, after considering all underwriting discounts and expenses. The Class C notes and Class R notes are currently being retained by a subsidiary of Conn's and may be issued in the future. Looking at Slide 8 in the presentation, our liquidity and capital flexibly to has improved substantially, following the ABS transaction, which we closed earlier this month. On a pro forma basis, reflecting the completion of this deal, as of January, 31, 2016, we would have had $160 million in cash, $125 million in ABL net availability and an additional $684 million in ABL committed growth capacity. During Q4, we repurchased 4 million shares of common stock for $100 million. This brings total share repurchases for fiscal '16 to 5.9 million shares for a total of $151.6 million. At this point, I'd like to turn things back over to Norm, for some final comments.

Thanks, Tom. I'd like to take just a few minutes before we open it up to questions, just to review highlights of our performance, which serves as the foundation for our long-term growth plan, and it's shown on Slide 9 in the earnings call slide. During the past fiscal year, we delivered positive same-store sales, excluding exited categories. Our trends in delinquency have stabilized due to changes we've made in underwriting and collections. We continue to build a diversified capital structure through a successfully completed, rated ABS transaction and our leveraging Synchrony for a portion of our no-interest financing, which will reduce capital requirements while improving returns. We are modestly lowering growth plans for the business to focus on improving our retail and credit execution and improve our infrastructure to support our longer-term growth opportunities. Finally, the business continues to reflect strength in key areas, including solid store economics and stable adjusted EBITDA results delivering nearly $150 million annually for the past 2 years. All of these actions give us a stable foundation we need to support future profitable growth. I'd like to close by recognizing Theo Wright, our nonexecutive Chairman, who intends to retire from our Board of Directors at the end of this current term. Theo's departure is part of a long plan, leadership succession developed by the Board, which included my appointment as CEO and President this past September and was based on his desire to devote more time and attention to other personal and business interests. We are deeply appreciative of Theo's many years of service to Conn's as a Board member and as Chairman and CEO. We're now happy to open it up to questions.

[Operator Instructions] Our first question comes from the line of John Baugh from Stifel.

Just a couple of things quickly. I noted the approval rate was down, I think year over year from roughly 45% to 40%. And that was the end of January or the January quarter. And some of these changes, I think you mentioned that would drive a 4% drop in the sales were made, I think more -- later than that. So can you correct me if I'm wrong on that. And it looks like when you take that drop in approval rate times the increase in applicants, you actually had a net approval decline of about 4% in the January quarter of accounts. So I wonder if I get all that math right and what the implications are for approval rates going forward?

So there were -- to your point, John, there were 2 factors. You pointed out 1 and it was only in for part of the quarter, and that was the underwriting changes we made around thin files and beginning to test in our early pay default model. And then second was we talked about last quarter, the marketing change we made to drive increased application volume and saw a lot application volume increase through the web, which has a higher decline rate, lower approval rate than our in-store application. So part of it just had to do with the source of the application growth.

I will say we are seeing some general weakening from -- across the credit performance from a customer standpoint, a softening. I would depict it as across all segments of customers. But the significant portion is the increase from a web standpoint versus the in-store application.

Yes, and then Norm, that seems to match. I guess, here again, to have the math right you -- and I know you're making a change prospectively moving Synchrony-type business back out. But it looked like your average FICO score was relatively unchanged and -- year over year and if I'm not mistaken, you were bringing on Conn's books higher FICO score customers during that period. Does that speak to some of that general weakening of the existing customer and the portfolio since you originated?

If you look at the history from a FICO score standpoint, we did see a benefit this year by a couple of points, from the movement of bringing those high FICO scores' customers on our books. But if you look historically, I mean, it affects it by 3 or 4 or 5 total points at the end of the day, but that's not the material driver that's driving that weakness.

Okay. And then just 2 other quick ones, if I could. Can you update us on the payment rate covenant and sort of where we sit on that? I know seasonally, it gets better in your April quarter, but just a broad view on that. And then, I noticed the reage balance was up almost 50% year over year and the portfolio growth was obviously less than that. Were there any changes in the reage policy?

Yes. So from a payment rate standpoint, we were in compliance in fourth quarter. And in tax season, we would expect to see the normal seasonal lift. So payment rate in the fourth quarter was just a little over 4.5%. And then from a reaging standpoint, no changes in our reaging policies or practices to speak of. And from a seasonal standpoint, it kind of follows a normal seasonal pattern. It just has to do more with the fact that delinquencies have been elevated for a period of time here.

Our next question comes from the line of Brad Thomas from KeyBanc Capital Markets.

My first question is on new store productivity and you made some comments about it in your prepared remarks, but I could -- I was hoping you could just give us an update on how you're thinking about new store productivity from a revenue perspective, given the current underwriting policies and the markets that you'll be entering. And then secondly, from a bigger picture perspective, should we be thinking of the new stores as being something that could be additive, just earnings in that first year or is that something that is diluted? And if so, could you quantify?

Sure, Brad. First if you look at our new store sales with some of the underwriting changes that we've made as well as we've slightly altered our grand opening schedule or plan. We've spread it out over more months in fiscal year '16 versus '15. We see our first year monthly sales on new stores averaging about $780,000 in fiscal year '16 versus about $830,000 for stores opened in fiscal year '15. As we implement some additional underwriting changes for new customers, we would expect to see that come down to some degree. However, having said that, we're -- most of the new stores that we're opening, the 10 new stores will be within existing markets, if you will. So we'll -- a number of those customers will be existing customers that will come into those stores within the marketplace as well. And our expectation is that from a 4-Wall EBITDA profitability standpoint, we don't expect the material difference from a profitability and return standpoint economically. It may move it a month or 2, but still very, very strong store economics.

Yes. We haven't seen the EBITDA payback period move meaningfully. It stayed within that 3 to 6 months range we've seen historically. And then I just add long term, we still expect the store revenue potentials to be similar to what we think today. It's just that the time to get there may be slightly longer.

We're being a little more cautious with new customers to ensure that we're balancing from a credit risk standpoint appropriately.

The other thing we're doing from an economic standpoint with new stores is the openings this year are focusing on existing markets so that we leverage the existing distribution. And then, it's more efficient from an advertising perspective as well.

Great. That's helpful. And then you obviously referenced some investments that you'll be making in IT and some other areas. I guess, could you give us some examples of where these IT investments could start to give you some benefits to the customer. And to the extent you want to quantify what investments you're making, if it's important for the P&L. Any color will be appreciated.

Absolutely, Brad. We are anticipating to invest about $5 million to $7 million over the next 12 to 18 months. As I've mentioned in 3 primary areas: credit, where we'll be investing in additional staffing to assist with building more sophisticated modeling, forecasting, monitoring capabilities; from an IT standpoint, investing in both people and systems to enhance our business capabilities and really improve from a customer experience standpoint and build out the infrastructure and make ongoing enhancements as well from a compliance standpoint from an IT stand -- IT perspective; and lastly, the third element was HR. We're looking to built the team up. We need to enhance our recruiting, our retention and leadership development capabilities to ensure that, as we look forward in the fiscal year '18 and beyond, we have that foundation and that infrastructure in all 3 critical areas that will enable us to accelerate or increase our growth plans.

Our next question comes from the line of Peter Keith from Piper Jaffray.

Actually, this is Jon on for Peter. First off, I guess, in looking at your interest expense for fiscal year '17, it looks like the last couple of quarters, you've been running around about an 8% rate. Are there any parameters you can provide for this full year? I mean is that kind of roughly in line with what we should be expecting or any detail you could give there?

Yes, the way you can frame up our interest expense really going forward is just think about the debt that we will be carrying as a percent of our average customer portfolio balance. So just the leverage figure, which we cited in Q4, which was fully reflective of moving into the ABS inclusion in our structure. So we had that ratio of about 77%. So if you look at that and then look at the rates that we have in the different buckets of our financial structure, the ABL, the high-yield notes and then the ABS as we're disclosing the cost of funds as we go into it, you can sort of build a portfolio of what our debt looks like and that's probably as good way as any to estimate our interest expense. You'll need to have an assessment of where you think the portfolio is going to go, but that gives you the pieces to build it up.

Okay, and then I guess, my second question is as far as with these pricing investments I guess, you guys made in Furniture and Mattresses and then also Appliances in the fourth quarter, I know that impacted the product margin some, do you feel at this point now you're competitively priced and was that kind of a one-time thing you think in the fourth quarter or do you expect the pressure on margin to continue as we go forward the next several quarters?

We don't anticipate that, that similar pressure on margin continues here, at least, over the next several quarters. We feel we are very competitive from a pricing standpoint. And some of the things we did, eliminate some SKUs and change some SKU assortments, and exiting that from a clearance standpoint to get those exited SKUs out is really what drove as much of that margin decline as anything, but that's a one-time thing. We don't see that going forward.

Okay. Great. And then just one last, quick one on the residual from your first transaction, do you have any update there on a potential sale or on all or part of that residual?

Given the volatility there have been in the capital markets here, the first part of the year and in the ABS market, and the way that spreads have widened, it now would not be conducive to trying to effectively market a residual and in fact we and several other issuers have even retained subordinated tranches of bond offerings just because of the widening of spreads and pricing in the markets recently.

Now, having said that, though, the performance of our first ABS transaction has continued to perform exactly what we have -- very close to what we have laid out. And as the residual holder through February, we've received $26 million of cash flow and as a servicer, an additional $28 million for a total of $54 million. So, but now the fact is that residual has performed as we have laid out, was very helpful as we went into the market for the rated transaction to build confidence and increased our investor base going forward because of our performance with that first transaction.

Our next question comes from the line of Brian Nagel from Oppenheimer.

So first question. I know you gave a lot of detail on your prepared comments, but as we look at the fourth quarter results here, in particularly the credit metrics and your P&L, such as the loan loss provision. Is there anything in there that we should view as more or less onetime in nature, as we think about the trajectory for loan loss provision going into your -- into the next year?

In the fourth quarter, no, nothing, particularly one-time in nature. I think what you're -- what we're seeing is that as we've made the underwriting changes this past year and the additional changes we're making, it takes time for that season into the portfolio along with the slower growth we saw in the latter part of this year and the lower projected growth pace this year. We'll change the customer mix and one of the biggest drivers of losses is just the customer mix, and the number of new customers being originated and in the portfolio and given that they have a loss rate that's nearly 2x that of a repeat -- longer term repeat customer.

Got it, thanks Mike. And then the second question with respect to the securitization. So you -- Conn's has recently completed securitization. You talked a little bit about that. So my question is -- it'll maybe a couple parts, what's the likely timing? I understand a lot of this is market dependent and such. But what's the likely timing of the next securitization? And then as we're looking -- as investors were looking at the securitization, I mean what should we look for or expect to see in terms of indications that the strategy is working, that the securitizations are becoming easier or less expensive for Conn's?

Well, I'll initially start at least to say, we expect this execute 1 to 2 additional securitizations before the fiscal year is over. Some of that will be dependent in some parts of what's happening from an overall capital market standpoint. And to the second part of your question concerning what can you look at to determine whether or not the strategy is working longer term on our entry into the ABS market would be what -- at the end of the day what our costs are, and the cost of borrowing and the leverage amounts are going forward with future transactions. Clearly, as we entered into the market with the second transaction, we had a very different capital market than we did last August and September with the first securitization, but even with that, more volatile capital market, we were able to improve from a performance standpoint, following cost at the end of the day. And longer term, it would be our expectation to drive our all in-cost, not down to the ABL cost, if you will, but in that 4.5% to 5% range would be where we would expect longer term.

And some other and bigger accomplishments in this transaction is, because when it was rated, we did get the investment grade rating that opened up the investor base to a lot of different investors that wouldn't participate in an unrated transaction. We attracted a very different, longer term, money-manager investor base versus the predominantly hedge-fund investor base in the unrated transaction. And then when you look at the spreads on our deal versus similarly rated transactions for others in the recent last couple of months, our pricing compares very favorably to these other transactions. Everybody saw significant spread widening and some more than -- had a bigger impact than even we saw.

Got it. And as we -- 1 more quick question, if I could. Different topic. But -- and I don't recall if you addressed it in your comments or not, but any difference or any further shift in your performance of the markets that are more oil dependent for Conn's?

We continue to see a relative stability in that performance. We keep watching it closely, but no real trend changes in that, that we've seen.

Our next question comes from the line of Rick Nelson from Stephens.

Just to follow up on that question about energy fee markets. Your comments about kind of relative stability, is that true, both from a sales standpoint as well as a credit standpoint, are there differences there?

Yes. That is true from both perspectives. We haven't seen any signs at this point in delinquency that the energy-impacted markets are performing any differently than our other markets and Tom was speaking specifically to sales.

Having said that, Rick, it's harder on the delinquency standpoint, we really believe that unemployment is a better trend that would indicate, where we would have real concern from a delinquency standpoint in those markets. So we monitor unemployment pretty closely and we haven't seen significant degradation there, but that's why we're on the watch-out to determine if we're going to see softening in that area.

Also like to ask you about buybacks, up to the first securitization those fully capped out, but you could talk about where you are now with the authorization and the liquidity or financial wherewithal given some of your bank account requirements. What you could potentially do?

Yes. Currently, at least in the short term, we are not anticipating any future buybacks. Certainly over the next couple of quarters and really it's just from a conservative nature of -- from a capital standpoint and a liquidity standpoint, with the volatility of the markets as we went out with this second ABS transaction, we're being very cautious in ensuring that we have ample cushion from a liquidity standpoint and a capital standpoint to be able to grow the business.

Also, finally, if I could ask you the same-store sales guidance that you provided. Is that where you're tracking to date?

For the month of March, it's actually -- we're tracking a bit softer than what we have provided from an overall guidance standpoint. We expect March same-store sales to be down low to mid-single digits, driven by a couple of things: first, the underwriting changes that we had discussed, both the ones implemented in the fourth quarter and some impact on the additional underwriting changes that we're implementing here in the month of March; secondly, Easter -- Easter holiday, where our stores were closed, actually fell in March this year versus April last year, and that's about a $4 million impact; and lastly, the month started off from a macro standpoint, just softer, but having said that in the past 2 weeks, we've seen a significant improvement from a sales standpoint, even with the underwriting things that we're putting in place, where they've been flat up low single digits for the last couple of weeks. All in, we still expect for the month to be in the low to mid-single-digit same-store sales down for the month of March.

Our next question comes from the line of David Magee from SunTrust.

First question has to do with just that the EBIT margin visibility this year. You mentioned the additional investments of $5 million to $7 million, I think. Given the gross margin improvement that you're expecting, do you still think that -- or do you think the EBIT margins might be flat or higher year-over-year this year?

Could you repeat the question? because it's breaking up a little bit.

It's breaking up. Can you repeat it?

Yes, sorry. I -- yes, just again with regard to the EBIT margin visibility this year, given the additional investments, do you think that the gross margin improvement will be offsetting in that regard? And so EBIT margins will be flat or any color there would be helpful.

Overall, we would expect them to be close to flat year over year.

And what are you seeing with regard to incremental wage pressures this year?

Most -- the significant portion of our sales force from a retail standpoint is commissioned sales. So we don't see significant impact there on the collection side of the house or the credit side of the house. We haven't seen any materially, at least in the markets that we operate in, to make any note of.

Great. Last question. What is your sense for when the lines might cross this year with regard to delinquencies. Do you still think mid-year is an appropriate target for that?

It's a little hard to predict, David. Firstly, with the slowing the growth of the business, moving the high FICO score business to Synchrony and then what we've seen in the macro environment with the way the subprime credit is performing broadly in the macro environment has been weaker of late. It's hard to predict where the crossover point would be, but we're making those additional underwriting changes we think are prudent to make sure that we're delivering profitable business and a profitable mix to customers.

And this does conclude the question-and-answer session of today's program. I'd like to hand the program back to management for any further remarks.

Thank you. We appreciate everybody's participation, and we look forward to talking with you next quarter and sharing our results. Thank you.

Thank you, ladies and gentlemen for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.