Good morning and thank you for holding. Welcome to the Conn’s Inc. Conference Call to discuss Earnings for the Fiscal Quarter Ended October 31, 2020. My name is Doug and I’ll be your operator today. During the presentation, all participants will be in a listen only mode. After the speakers’ remarks, you’ll be invited to participate in a question-and-answer session. As a reminder, this conference call is being recorded. The company's earnings release dated December 8, 2020, was distributed before market opened this morning and can be accessed via the company's Investor Relations Web site at ir.conns.com. During today's call, management will discuss, among other financial performance measures, adjusted net income and adjusted earnings per diluted share. Please refer to the company's earnings release that was issued today for a reconciliation of these non-GAAP measures to their most comparable GAAP measures. I just want to remind you that some of the statements made in this call are forward-looking statements within the meaning of federal securities laws. 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; Lee Wright, the company's COO; and George Bchara, the company's CFO. I would now like to turn the conference over to Mr. Miller. Please go ahead.

Good morning, and welcome to Conn's third quarter fiscal year 2021 earnings conference call. I'll begin the call with a strategic overview, and Lee will provide additional details on the quarter before turning the call over to George, who will complete our prepared remarks with additional comments on the financial results. The economic environment remains extremely fluid as the pandemic continues to impact many communities across the country. We believe our conservative operating approach has allowed the company to successfully navigate current market conditions, while also positioning the business to capitalize on our long-term growth opportunities. Our home-related product strategy and multiple financing options continue to drive strong growth of cash and third-party credit sales, which increased 32.7% year-over-year during the third quarter. Overall, same store sales continue to be impacted by the underwriting changes we implemented beginning in March 2020 in response to the COVID-19 crisis. We believe underwriting changes combined with industry wide inventory shortages in certain product categories reduced year-over-year same store sales by approximately 20% in the third quarter. Despite these impacts, I am encouraged by the sequential improvement in same store sales. Third quarter credit performance reflects the quick and prudent adjustments we made earlier this year to mitigate the potential impacts on our business of high unemployment and economic uncertainty. As a result, our credit segment is benefiting from newer, higher-quality originations, and strong cash collections. Since the beginning of our fiscal year, our balance sheet has strengthened significantly as a result of the reduction in the portfolio balance due to the stronger rate of cash collections and higher cash and third-party sales. In fact, we ended the third quarter with the lowest level of net debt as a percent of the portfolio balance in over six fiscal years. We also successfully closed an ABS transaction in October 2020, our first since the onset of the pandemic. We believe the progress we made during the quarter provides us with significant flexibility to support our business through the COVID-19 crisis. During the third quarter, we also continued to invest in our long-term growth initiatives, which include expanding the capabilities of our e-commerce and omnichannel platforms, enhancing our credit platform to extend credit to more customers, while achieving 1,000 basis points of credit spread, and capturing more declined applications for Conn’s credit through third party lease-to-own solutions. These actions will not only help our business through the COVID-19 pandemic but will also expand our long-term growth opportunities. In addition, we continue to pursue our geographic expansion strategy and open new showrooms in targeted markets. On November 6, we opened our first Florida showroom in Pensacola, and we are excited by the potential the Florida market represents. We plan to open a majority of our new showrooms next fiscal year in Florida to leverage our Lakeland distribution center that is scheduled to open in January 2021. As you can see, we continue to focus on successfully navigating the COVID-19 crisis while investing in our business to support future growth opportunities. I want to personally thank all of our associates for their continued dedication during this challenging period. On behalf of everyone at Conn's, we remain committed to helping our customers and communities in this time of need. So with this overview, let me turn the call over to Lee, who will provide more details on our third quarter operating results.

Thanks Norm. I'll start my prepared remarks today looking at our credit operation in more detail. Overall, our credit business reflects the successful execution of the prudent credit strategies we implemented in mid March to successfully navigate the impacts of the COVID-19 crisis, while supporting our retail sales with our multiple third-party credit options. The strength of cash repayments on outstanding loans within our portfolio is encouraging and continues to exceed the seasonal trends we typically experience. In fact, the third quarter payment rate increased 16.3% year-over-year and represented the best third quarter cash payment rate in over 10 fiscal years. We believe the strong internal collection efforts and lower consumer spending are having positive impacts on cash collections within our portfolio. As we've stated on our last conference call, we've revised certain of our reaged programs in June to be more restrictive and improved the balance of reaged accounts within our portfolio. As a result, the dollar balance of the carrying value of reaged accounts on October 31, 2020, has declined $75.7 million or 17.9% year-over-year and is down by $45.5 million or 11.6% from July 31, 2020. In addition, the dollar balance of 60-plus day delinquencies has declined from the prior fiscal year period. It will take time for overall credit trends to normalize given the severe economic challenges COVID-19 pandemic has caused and the prudent credit strategies we've put in place. However, we expect favorable underlying performance within our portfolio to continue to lead to sequentially lower charge offs for the remainder of this fiscal year. In addition, accounts originated after March’s underwriting changes have benefited from higher FICO scores and a higher mix of existing customers. We also continue to see a larger population of higher quality applicants as other prime and near prime lenders have tightened their underwriting standards. As we continue to successfully navigate this challenging and uncertain economic period, we are encouraged by the improving credit trends we are experiencing. And on October 31, 2020, our credit spread was 6.4%, representing a 420-basis-point improvement from July 31, 2020. We also continue to expand the capabilities and enhance the infrastructure of our credit segment. TJ joined Conn's in July as the company's Chief Credit Officer and has over 20 years of leadership experience at various prime and near prime consumer finance companies. TJ is quickly contributing to our success, and several credit initiatives are under way to identify opportunities to increase retail sales, while maintaining credit risk. Capturing more retail sales through our third-party lease to own solutions remains an important priority for our team and represents a significant opportunity for Conn's and our third-party providers. We have a strong belief that lease-to-own sales should be at least 10% of our total retail sales compared to 7.2% in the most recent quarter. This is especially true now that we are deploying more applications as a result of our tighter underwriting standards. We're working with both our existing partner and testing other lease-to-own providers to achieve this goal, and I look forward to updating investors on our success in the coming quarters. Overall, we believe our third quarter results highlight the resiliency and flexibility of our unique credit and retail business model and the ability to de-risk our credit business while still supporting retail demand through our diverse credit options. So looking at our retail segment performance in more detail. Total retail sales declined 7.3% while same store sales declined 10.9% for the third quarter compared to the prior year period, primarily due to the underwriting adjustments we began implementing in mid-March in response to the COVID-19 crisis, and to a lesser extent limited product availability. We believe these headline numbers do not reflect the positive underlying trends that are occurring within our retail segment, which include strong year-over-year growth in cash and third party sales, sequential improvements in monthly same store sales throughout the third quarter and 1.2% year-over-year increase in third quarter same store transactions. These favorable trends have occurred despite the continued impact on retail sales of tighter underwriting, which we believe combined with industry wide inventory shortages reduced year-over-year same store sales by an estimated 20% during the third quarter. We are pleased to see the November same store sales came in better than the third quarter results despite the nationwide COVID-19 resurgence and the continued impacts of tighter underwriting. Looking at our product categories in more detail. Total appliance sales during the quarter increased 10.5%, which represents 210 basis point increase from the growth rate in the second quarter. We are also starting to experience improving trends within our furniture and mattress category as total sales of furniture and mattress increased 2.2% sequentially. Conversely, our consumer electronics category remains challenged and continues to experience significant TV price deflation. Industry wide supply chain challenges continue throughout the third quarter across most of our categories. Inventory availability suffered as a result of COVID-19 related impacts on category production, as well as transportation delays, especially for imports. We expect inventory constraints to continue throughout the holiday season with product availability improving in the first quarter of our upcoming fiscal year. Turning to our retail growth initiatives. We are constantly testing new ways to leverage our unique in house financing and better serve our core customers. Flooring and fitness are two product groups where we believe our core customer is underserved. After successful tests of both product groups within select markets, home fitness equipment now for sale in all of our showrooms and flooring is now sold in more than half of our showrooms. We plan to continue to expand and refine our product strategies to offer more home related products that resonate with our core customers. Last year's launch of our new e-commerce platform and upgraded website continues to support e-commerce growth and third quarter sales through this channel increased nearly 61% compared to the prior fiscal year period. E-commerce represents only 1.9% of trailing 12 months sales and we believe that we have a substantial opportunity to increase sales through this channel. As a result, we've increased investments in our e-commerce efforts and expect to accelerate these initiatives over the coming year, which we expect will impact our total SG&A spend. To assist in offsetting higher e-commerce investments, we continue to focus on driving cost savings and improving efficiencies across our organization, and we have successfully lowered operating expenses across several categories since mid-March. Compared to the prior fiscal year period, retail SG&A expenses have declined $13.9 million year-to-date despite an approximately 4.5% year-over-year increase in retail square footage. We opened to additional showrooms during the third quarter and have opened one new showroom in the fourth quarter, bringing the total number of new stores opened today in the fiscal year to seven. As of today, we operate a total of 144 showrooms across 15 states and have plans to open eight to 10 new showrooms next fiscal year. We continue to believe that as an omni-channel retail that we have opportunities to grow both our brick and mortar and online business simultaneously. So to conclude my prepared remarks, I'm pleased with the progress we're making in navigating the COVID-19 pandemic, while refining our strategies to support the current and future needs of our business. We believe our third quarter results demonstrate the resiliency of our business model and the growing success of our digital platform. This combined with our compelling financial model experienced leadership team and strong balance sheet provides the necessary resources to successfully manage the business through this challenging period. On behalf of the entire leadership team, I'd like to thank our employees for your continued hard work, service and dedication. Now let me turn the call over to George to review our financial performance.

Thanks Lee. Over the past nine months, our balance sheet and capital position has strengthened materially because of the actions we took to mitigate the potential impact on our business of high unemployment and economic uncertainty. The business generated operating cash flow of $79.7 million during the third quarter and $385.5 million year-to-date, which is $293 million increase from the prior year-to-date period. This is primarily driven by the significant year-over-year increase in cash and third-party sales and the decline in our customer accounts receivable balance as a result of tighter underwriting and a stronger rate of cash collections. The year-over-year increase in operating cash flow also drove a decline in net debt as a percent of the ending portfolio balance from approximately 59% at January 31, 2020, to approximately 48% at the end of the third quarter. In October, we closed our latest ABS transaction and our first since the onset of the pandemic. Our 2020-A transaction exhibited strong demand and favorable pricing. We sold the Class A and Class B notes for $240.1 million with an all in cost of funds of approximately 4.84%. This reflects the second best pricing through the Class B notes we have achieve in the ABS market, and is only 64 basis points higher than our last pre-COVID transaction. We also chose to retain the $52.9 million of Class B notes issued in the transaction based on our strong liquidity position and the current capital needs of the business. The Class B notes may be sold at a later date to support the future liquidity of the business. At October 31, 2020, we had total cash immediately available liquidity of approximately $384.7 million, which included $107.8 million in cash and cash equivalents and $276.9 million of availability under our existing revolving credit facility. We believe this provided more than enough liquidity to support the current needs of our business, and on November 30 2020, we announced the cash tender offer were up to $100 million of our 7.25% senior notes that mature in July of 2022. We expect to complete the tender by the end of the calendar year. As you can see, our capital position and liquidity remains strong and we are proactively managing our cost of funds, while ensuring we have the financial resources to support the long term needs of our business. Moving to our financial results. On a consolidated basis, revenues were $334.2 million for the third quarter, representing an 11.1% decline from the same period last fiscal year. We reported GAAP net income of $0.25 per diluted share for the third quarter compared to GAAP net income of $0.39 per diluted share for the same period last fiscal years. On a non-GAAP basis, adjusting for certain charges and credits, we reported net income of $0.25 per diluted share for the third quarter compared to net income of $0.49 per diluted share for the same period last fiscal year. Reconciliations of GAAP to non-GAAP financial measures are available in our third quarter earnings press release that was issued this morning. Our financial results for the third quarter reflect the success of our cost savings initiatives. Consolidated SG&A expenses were $122.2 million, a $3.4 million decline from the prior year. Year-to-date, consolidated SG&A expenses have declined $20.6 million from the prior fiscal year period. While we remain focused on cost controls, we expect fourth quarter SG&A expense to be approximately flat year-over-year. Looking at our retail segment in more detail. Total retail revenues for the third quarter were $259.9 million, a 7.3% decline from the same period last fiscal year. Retail gross margin for the third quarter was 38.3%, a decrease of 90 basis points from the same period last fiscal year. A decline in RSA commissions and retrospective income as a result of lower sales of Conn’s in-house financing was the primary driver of the year-over-year decline in retail gross margin. We expect this will continue to put pressure on our retail gross margin on a year-over-year basis during the fourth quarter. Retail segment operating income was $15.2 million compared to $19.6 million for the same period last fiscal year primarily due to lower retail sales and lower retail gross margins, partially offset by reductions in retail SG&A expense. Turning to our credit segment. Finance charges and other revenues were $74.2 million during the third quarter. The 22.5% decline from the same period last fiscal year was primarily due to a 16% reduction in the average balance of the customer receivable portfolio, lower insurance commissions due to a decline without the sale of our in-house credit financing and a decline in insurance retrospective income. For the fourth quarter of fiscal year 2021, we expect finance charges and other revenue to be down year-over-year primarily due to a lower balance of loans. Our provision for bad debts continues to benefit from a decline in the allowance for bad debts as a result of a shrinking portfolio balance, which was magnified by higher reserve percentages under CECL. In addition, during the third quarter, the allowance for bad debts declined as a result of a decline in forecasted unemployment rates. This decrease was partially offset by an increase in our allowance related to accounts that received the COVID-19 payment deferral based on the portfolio performance of these accounts. As a result our third quarter provision for bad debts was $27.4 million compared to $45.4 million for the same period last fiscal year despite higher year-over-year charge offs. Our credit spread for the third quarter was 6.4%, a 420 basis point increase from the credit spread of 2.2% last quarter. Credit segment loss before taxes improved to a loss of $2.7 million compared to a loss before taxes of $4.3 million for the same period last fiscal year. The year-over-year improvement is driven by a decline in the provision for bad debts, which reflects a stronger cash production rate, newer higher quality originations and the reduction in the portfolio balance as a result of higher cash and third-party sales. Finally, the third quarter tax rate was 41% compared to 24.8% for the same period last fiscal year. Year-over-year increase in the effective tax rate is driven by $1.7 million discreet tax expense recognized in the current period as a result of a reversal of a tax loss carry back that was recognized earlier this year. We expect to recognize a discreet tax benefit from the fourth quarter as a result of tax planning in connection with the CARES Act. So, with this overview, Norm, Lee and I, are happy to take your answer your question. Operator, please open the call up to questions.

Thank you. Ladies and gentlemen, we will now be conducting a question-and-answer session [Operator Instructions]. Our first question comes from the line of Rick Nelson with Stephens.

Norm, George, or Lee, what do you think is driving the sequential improvement that you saw, I think same store sales returning the third quarter and the fourth quarter to date? And if you could get more specific around those trends, especially the Black Friday period?

So as Lee mentioned in his comments, we saw improvement each month through the third quarter on same-store sales and continue to see improvements as we mentioned in the month of November, so very pleased. We have not changed from a credit underwriting standpoint where we've been in mid-March. So, it's not because of anything we're doing on the credit side of the house. It's really being driven by cash at third-party customer, the combination of Synchrony cash and lease-to-own, and the improvement year-over-year is driving that.

Are you having more aggressive right, I guess on promotions we could see some margin declines year-over-year?

No, I would say our promotions are fairly consistent year-over-year. That's certainly not what's driving it. I think the execution is better, and I think some of our e-commerce efforts for the very first time we've never had buy online pick up in store. We implemented that in the month of November, late-October and that has been doing very well for us, helping to drive our e-commerce sales as well. So, the digital and e-commerce side as well as the non-comp financing side are really the primary drivers of what's driving the sales, and that's why we're so bullish about next year because as we look at the opportunities on the Conn’s financing on the credit side, we know we will have opportunities there next year to help us from a same-store sales side. So, to be at what 20% impact of same-store sales and only be down 10.5% speaks to the power of the business model and what we believe our opportunity is for next year.

And one thing just to add on a category0specific basis is clearly we're pleased with the strength in appliances, but also the improvement we saw in furniture and mattress, which has been an important category. So, we were pleased to see that continued progression.

Can you speak to the e-commerce penetration, where you stand there, and these recent recommendations from the CDC to avoid in the store shopping, and have you seen any change in customer behavior?

Rick, we certainly -- there's no question that customers are more reluctant to enter into a showroom. So, we were pleased to see obviously our overall growth in e-commerce. But again, if you think about our e-commerce opportunity, we think we have a unique opportunity to grow that significantly today. For the last 12 months, we're basically at 2% balance of sales from e-commerce, and we think we have the ability to grow that significantly by multiples as customers get more accustomed to shopping online. As you guys know, we've started to invest and have been investing significantly. And as I said in my prepared remarks, we’ll continue to invest and that's an important channel for us that we really -- we're going to be that omnichannel retailer and that we will be there for our customer whether they want to shop online or in our showroom, and certainly have the broader spectrum of financing options, which we think we have the unique ability to offer to our customers.

And then shifting to the credit side, I am curious for where you think [losses] are going to shake out, especially in the recent [Technical Difficulty] as we look at the credit laws and data, and it looks like things are widening a bit there, if you could comment, and what your expectation is?

Rick, I think clearly, you're looking for the FY '20 vintage, which obviously we've discussed in previous calls where we had some higher risk, and obviously we knew we were going to and we talked about that, that we would have higher charge-offs from there. One of the things we did included in that table, though, which we think is important as you think about progression, clearly you can see the higher interest rates, the yield that we're getting. So that offsets it. But again, clearly, as I talked about in my prepared remarks, we've got TJ on board, our Chief Credit Officer. We're doing some things from a credit perspective that we think is very exciting, and we talked about being able to approve more but maintain the level of risks. So we're excited about what we have going forward. As we work with TJ looking at new credit scorecards, new systems, we think we have unique opportunities, so we're pleased going forward. And I guess the last thing I would tell you, Rick and I know you are focused on the losses. But clearly, with CECL we reserve at a full lifetime loss. So those reserves are incorporated. So really there's nothing that we're going to see unexpected as we look going forward, because we're reserving full lifetime losses.

Remember Rick, we took a significant -- with CECL that changed the CECL at the beginning of the year. So we believe we're adequately reserved even for those underwriting changes we made last summer that clearly impacted for losses in the back half of fiscal '20. However, with fiscal '21, since the pandemic very, very positive with FPDs and 60-day delinquencies and those trends that will bode for a strong performance going forward into next year.

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

Just want to follow-up on that last topic around the underwriting trends. I mean there’s clearly a number of metrics that would indicate that the customer is going into the portfolio of late has set up a backdrop for one of the stronger portfolios you've had in some time. I guess could you help to quantify to some degree what sort of opportunity you might have to loosen or return maybe to normal into what prior trends were, what kind of benefit that might be able to be to sales as you get comfortable that the world is getting more normal?

So what I would say, Brad, is you're right. I mean, the portfolio, both from a size standpoint, as well as a performance standpoint, probably both smaller and stronger perform and then anytime in the last six or seven years for certain, maybe longer than that. What that bodes to is with [TJ] coming aboard and not just [TJ], we've added additional resources there as well. It really does two things. Number one, we’re aggressively at more than we've ever done going after the non-financing side of the house, folks who are e-commerce, as well as Lee mentioned on the lease to own side [Technical Difficulty] we still believe we have there, but also as the world's gets a little more normal and hopefully, we come out of the pandemic early part of next year, our expectation is that 20% that we've taken a cut to in that there's a material amount of that we believe that we will be able to start taking greater risk with. Will it be 20%? No, we don't believe we'll need to go to that to be able to have positive same-store sales. But we believe there's material opportunity there in the first half of next year.

And Norm, you talked about the plans to continue opening in Florida next year. If I'm not mistaken, you talk about eight to 10 stores next year in the past. Is that still the plan? And can you give us some sense of the timing of those openings? And maybe George, any color on next year, early color you might be able to share about how to think about the SG&A and P&L implications from getting the store openings going?

Yeah, I'll start initially with the stores stuff. Yeah, eight to 10 is the right number that we're targeting. Most of those will -- we expect to be the vast majority of those to be in Florida as we leverage the new distribution center that opens in January. A significant portion of the stores will be in the first half of the year, even the first quarter. So I think George had mentioned on SG&A that we would be flattish year-over-year in the fourth quarter. This cut, the quarter we're now, part of that is because we're incurring expenses as we talk as we get ready to open new stores in Florida.

And our guidance around pre-opening expenses, Brad, hasn't changed. So we would still expect to see something around $250,000 to $350,000 per new store in the first six months preceding the opening. But now that we're opening eight to 10 stores next year compared to nine stores this year on a year-over-year basis, you won't see as much of an impact to SG&A. But remember, as you're looking at SG&A next year relative to this year, it's going to be higher on a dollar basis because of some of the cost cuts we put in place that have now we started to re-spend here in the back half of the year.

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

So I think a bit of a follow up to Rick and Brad's questions too. But on the first off, congratulation, we’ve seen the significant benefits to tighter lendings there on your financials. The question I have is, the sales that you're -- with the lendings there's been tight, so you're foregoing some sales. Any idea where those sales would be going? And then the question I have, another question is, as you -- as the environment allows you to get maybe little more aggressive with your lending standards. Is there the risk that you run having disappointed or distance yourself from those customers they may not return?

The first question as far as those customers that don't get approved from a Conn financing standpoint, their options really are very -- are fairly limited. They can they can go to a lease to own option either in our store or to a rent to own store. And as you know, a number of retailers as well have lease to own off, a number of big box retailers have lease to own options as well, or they go to a cheaper item that they cash, that they typically would not have another opportunity from a financing standpoint. And then regarding the second question, Lee, you want to…

And Brian, just to go back to clearly, with regards to -- it’s why we talked about the importance of the LCO. You know the fact that we are declining more, we want to make sure, which is as I mentioned in my prepared remarks, we're working with our existing partner very closely on making sure that we're maximizing opportunities with the client that we have, but as I mentioned we're testing some additional solutions out there as well. That's one piece. And then to the extent that we disappointed customers and will they come back but clearly, I think that you know and we offer best class financing solution for those customers for their needed home goods. And obviously we have the ability to remarket to them as well. So I mean, we want to make sure that we're giving them an appropriate experience so that we can bring them back. We're keeping track of it. So good news, we've been around for a long time. But it is a good question, Brian. But we’ll obviously do to stay in touch with those customers and bring them back to the fold we believe, especially with our digital marketing as well.

And at the 29% APR that we're at, they really don't have that option if they want to finance it someplace else. And we recognize that and they do as well, and why we offer the lease to own. And as Lee said, frankly, we've been disappointed with the balance of sale on lease to own and believe firmly in our -- and I'm very confident we will get north of 10% their balance to sales here into the coming year.

Then just one quick follow up, just so I understand the math. And Lee, I think you went and in prepared comments, you said that the actions you’ve taken and find with some supply constraints have reduced your sales by 20%. But does that mean comps are down about 10%, without those factors your comp would be plus 10%, is it that simple?

No.

Our next question comes from the line of Ryan Carr with Jefferies.

Congrats on the positive impacts to credit performance, it's definitely shown out to-date this year. Just first question from me, obviously, you are going -- you are adopting more along the lease to own side, as well as Synchrony. Just curious where you think it'll shake out in terms of where your -- where Conn’s percentage of financing is going to be, last quarter is a little bit under 50%. This quarter you're 52%. So really taking into account the 10% lease to own share where you think you'll really be running from your part of the book financing?

So we've been very -- I’ve been very cautious about giving a number, because we really are not targeting a set percentage within the pie. Because our goal is not just to reallocate the pieces of the pie but most importantly, to grow the pie overall. Having said that -- so as long as we can underwrite from a risk standpoint and we're comfortable with that with what we're putting in place, very comfortable with Conn financing being more than the 52% it was for this quarter, certainly being up to 60 or even over 60. Historically, it's been as high as the high 60s. So we're comfortable at those percentages with the appropriate risk from in-house standpoint. But same time we think the growth opportunity on Synchrony cash customers. If you look at Synchrony and cash customers combined, over the last quarter, it's almost 40% of the business versus pre-COVID, it was 25% of the business or thereabout approximately. So will it stay at that level? We're comfortable there and certainly marketing and going after that business on an ongoing basis. And that's why I really can't put a number of saying here's what the percentage should be. Because we want to let it play out with whatever the customer wants from a financing standpoint, as long as we're comfortable with in house financing that we can do that with appropriate risk. We'll let the percentages fall whether they may. But I would expect Conn financing to move up over the next year higher than the 52% because of the significant opportunity we have there.

And then I guess within that as well, you saw record cash collections year-to-date. I mean, do you see the same performance from a cash purchase perspective, are you seeing the same trends in that regard, or what have you observed to date on that?

As I said before, I mean, our cash collection -- the cash we're generating and collecting is a combination of two things. Number one, collecting at a higher level from the portfolio standpoint but also collecting more cash from third party transactions as well, which include not only cash but Synchrony and lease to own as well. So all of that impact on the cash collected. And we continue to see that, as Lee mentioned I think in his comments, we're at a 10 year high of cash collections in the third quarter and even going on into the fourth quarter and we continue to see it perform nicely above prior year, which as you know that certainly helps from a portfolio performance standpoint significantly.

And last one from me, delinquencies were up a bit quarter to quarter. I mean is that just a function of the lower portfolio balance or what really caused the decline, or the increase there?

It's really a couple of things. First, seasonality wise, third quarter is typically the highest order of things, the quarters from a delinquency standpoint. And then it's really the denominator effect is the primary driver. 60 day dollars are actually down but the portfolio is declining at a faster rate than the 60 day dollars are going down.

And as you know, Ryan, it's a seasonal impact as well, which you see going from Q2 to Q3. And from a dollar perspective, looking year-over-year is only up about $10 million versus $20 million last year as well.

Our next question comes from the line of Bill Ryan with Compass Point.

A question on the allowance and the provision, sort of looking back when you adopted CECL. The allowance level looks to be about 20 -- just under 21% of receivables, closer to 25% right now. I know you're holding reserves up fairly high. Just in I guess it's a not knowing how everything's going to perform kind of the wait and see mentality of things. But looking at it going forward with the tight origination standards that you have, credit eventually kind of working its way through one way or another. I mean, is it fair to assume that the provisioning rate on the new receivables will be that reserve level might drift lower than where it was at the beginning of the year?

Yes, that is a -- over the long term with a significantly lower balance of sale Conn finnacing as we've seen with much higher quality underwriting, it is fair to assume that over time the allowance rate will drift down below where it was before. The one key factor, as you pointed out, Bill, is the fact that we've got a significant reserve still on the balance sheet associated with the increase in forecasted unemployment rates. And so that's the ex factor in terms of whether when we will actually start to see the reserve percentages drift down below where they were when we adopted CECL.

Not only that, Bill, in addition, as you heard in the comments, I think, our reages and our TCR balances and percentages are coming down as well. And we've done that proactively and aggressively to derisk the portfolio. And as you know, those are reserved at materially higher rates. So as those balances continue to come down and we focus there that will ultimately result in a lower allowance and provision as well.

And just one follow up a little bit more granular but on the provision in the quarter. You mentioned, there's a couple of factors kind of one push but it is little higher, one was a little bit lower, the benefit being a lower unemployment rate. If you net those two out, were they kind of a wash on those two factors mean the provision is kind of like, net, net kind of a fair number to use relative to the originations that you're putting on the books for the quarter?

The two factors were a wash when you look at it on a relative basis. Bill, the primary driver of the decrease in the allowance portfolio [indiscernible] quarter-over-quarter, so the allowance rate was about flat quarter from a quarter.

There are no further questions. I'd like to hand the call back to Mr. Miller for his closing remarks.

Thank you. We appreciate everyone's interest in the company, and look forward to talking to everyone at the conclusion of our fourth quarter. Wishing everyone a Merry Christmas and a Happy Holidays. Thank you.

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.