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Feb 12, 2007

Credit Acceptance Announces Fourth Quarter and 2006 Earnings

SOUTHFIELD, Mich., Feb 12, 2007 (PrimeNewswire via COMTEX News Network) -- Credit Acceptance Corporation (Nasdaq:CACC) (the "Company") announced consolidated net income for the three months ended December 31, 2006 of $8.5 million or $0.27 per diluted share compared to $25.2 million or $0.65 per diluted share for the same period in 2005. For the year ended December 31, 2006, consolidated net income was $58.6 million or $1.66 per diluted share compared to $72.6 million or $1.85 per diluted share for the same period in 2005.

The financial results for the three months and year ended December 31, 2006 include a pre-tax charge of $11.2 million related to settling a class action lawsuit in the state of Missouri. As previously announced, the Company has signed a Memorandum of Understanding to settle a class action lawsuit in the Circuit Court of Jackson County, Missouri. The lawsuit has been pending since October of 1996 and is described in detail in the Company's Annual Report on Form 10-K for the year ended December 31, 2005 and most recently in the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2006.



 Operating Results
 -----------------

Results for the three months and year ended December 31, 2006 compared to the same periods in 2005 include the following:



 --  Consumer loan unit volume increased 21.6% for the three months
     and 13.1% for the year.
 --  Consumer loan dollar volume increased 39.2% for the three months
     and 19.5% for the year.
 --  The number of active dealer-partners increased 24.7% for the
     three months and 26.4% for the year.
 --  Consumer loan unit volume per active dealer-partner decreased
     2.2% for the three months and 10.6% for the year.
 --  Net cash collections on loans increased 10.9% for the three
     months and 19.6% for the year.
 --  Dealer holdback payments increased 22.8% for the three months
     and 33.5% for the year.

 Adjusted Financial Results
 --------------------------

Adjusted financial results are provided to assist shareholders in understanding the Company's financial performance. The data below is non-GAAP financial data, unless labeled otherwise. Adjusted financial information is used internally to measure financial performance and is utilized in incentive compensation plans. The following tables include adjustments related to infrequent and unusual items as well as adjustments to reflect non-GAAP accounting methods ("Floating Yield adjustment" and "License fee yield adjustment") explained in the subsequent Floating Yield Adjustment and Change in License Fees sections. Adjusted average capital, adjusted net income, adjusted net income per diluted share, adjusted net income plus interest expense after-tax, and adjusted return on capital are all non-GAAP financial measures.



                                           For the Years Ended
                                               December 31,
                                   -----------------------------------
 (Dollars in thousands,
  except per share data)               2006          2005     % Change
                                   -----------   -----------  --------
 Adjusted net income
 -------------------
 GAAP net income                   $    58,640   $    72,601
 Floating Yield adjustment
  (after-tax)                              359        (2,202)
 License fee yield adjustment
  (after-tax)                           (2,759)       (2,112)
 Loss (gain) from operations
  of discontinued United
  Kingdom segment
  (after-tax) (a)                          207        (4,404)
 Foreign exchange gain due to
  liquidation of Canadian
  business (after-tax) (b)                --            (752)
 Litigation expenses
  (after-tax) (c)                        7,045          --
 Adjustment resulting in
  comparable tax rate for
  both periods (d)                      (1,055)        1,055
                                   -----------   -----------
 Adjusted net income               $    62,437   $    64,186      (2.7)

 Adjusted net income
  per diluted share (e)            $      1.77   $      1.64       7.9
 ----------------------

 Diluted weighted average
  shares outstanding:               35,283,478    39,207,680

 Adjusted average capital
 ------------------------
 GAAP average debt                 $   259,802   $   186,901
 GAAP average shareholders'
  equity                               290,215       333,475
 Floating Yield adjustment               5,510         7,574
 License fee yield adjustment           (7,045)       (4,512)
                                   -----------   -----------
     Adjusted average capital      $   548,482   $   523,438       4.8
                                   ===========   ===========
 Adjusted return on capital
 --------------------------
 Adjusted net income               $    62,437   $    64,186
 GAAP interest expense
  after-tax (f)                         14,698         8,748
                                   -----------   -----------

 Adjusted net income plus
  interest expense after-tax       $    77,135   $    72,934       5.8
                                   ===========   ===========

 Adjusted return on capital (g)           14.1%         13.9%      1.4


 (a) On December 30, 2005, the Company sold the remaining consumer loan
     portfolio of its United Kingdom subsidiary.

 (b) A currency exchange gain was recognized during the fourth quarter
     of 2005 following the determination that the liquidation of
     business in Canada was substantially complete. The Company
     expects items of this nature to be non-recurring.

 (c) The  Company  provided  for $11.2  million of  additional  legal
     expenses  related to an increase in its loss  related to a class
     action lawsuit in the state of Missouri ($7.0 million after-tax).
     The Company expects litigation of this size and nature to be
     infrequent.

 (d) This adjustment  allows the reader to compare the current period
     to the prior period assuming a comparable tax rate in both
     periods. The Company approximates a long term effective tax rate
     of 37%.

 (e) Adjusted net income per diluted share is calculated by dividing
     adjusted net income by the diluted  weighted  average  number of
     shares outstanding.

 (f) Interest expense after-tax calculated using a 37% tax rate.

 (g) Adjusted return on capital is defined as annualized adjusted net
     income plus interest expense after-tax divided by adjusted
     average capital.

For the year ended December 31, 2006 compared to the same period in 2005, adjusted net income plus interest expense after-tax increased 5.8% while adjusted average capital increased 4.8%. The adjusted return on capital improved from 13.9% to 14.1%.

The percentage change in adjusted average capital is primarily a function of loan origination growth. The following table summarizes loan origination growth from the period presented to the same period in the prior year:



                 For the Year           For the Three Months
                    Ended                       Ended
                 -----------  ----------------------------------------
                   Dec. 31,   March 31,  June 30,   Sept. 30,  Dec. 31,
                     2006       2006      2006        2006       2006
                 -----------  --------  --------    --------  --------
 Growth in
  consumer
  loan dollar
  volume            19.5%       10.3%      5.1%       27.8%      39.2%


                 For the Year           For the Three Months
                    Ended                       Ended
                 -----------  ----------------------------------------
                   Dec. 31,   March 31,  June 30,   Sept. 30,  Dec. 31,
                     2005       2005      2005        2005       2005
                 -----------  --------  --------    --------  --------
 Growth in
  consumer
  loan dollar
  volume            2.7%         3.9%      6.4%       -3.3%       4.3%

The improvement in adjusted return on capital for the year ended December 31, 2006 compared to the same period in 2005 primarily reflects an increase in revenue as a result of pricing changes and favorable collection results partially offset by an increase in expenses reflecting increases in accounting fees, legal expenses, and information technology costs.

Importantly, as previously reported, the Company expects the adjusted return on capital to decline in 2007, as compared to 2006, reflecting pricing changes implemented during the third quarter of 2006, and to a lesser extent in January of 2007. The Company now estimates, as a result of previously announced pricing changes, that the adjusted return on capital of 2006 loan originations will be approximately 125 basis points (the prior estimate communicated was 100 basis points) lower than the adjusted return on capital of 2005 originations and expects a further decline of approximately 25 basis points in 2007 due to the change in license fees described below.

Based on current market conditions, the Company believes these pricing changes will produce higher unit volumes and, as a result, higher economic profit than the Company would have without them. Economic profit is defined as net income less an imputed cost of equity capital.



                                    For the Three Months Ended
                                            December 31,
 (Dollars in thousands,         --------------------------------------
  except per share data)            2006          2005       % Change
                                -----------   -----------   ----------
 Adjusted net income
 -------------------
 GAAP net income                $     8,495   $    25,240
 Floating Yield adjustment
  (after-tax)                           917        (2,224)
 License fee yield
  adjustment (after-tax)               (824)         (950)
 Loss (gain) from
  operations of
  discontinued United
  Kingdom segment
  (after-tax) (a)                        14        (3,125)
 Foreign exchange gain
  due to liquidation of
  Canadian business
  (after-tax) (b)                     --             (752)
 Litigation expenses
   (after-tax) (c)                    7,045          --
 Adjustment resulting in
  comparable tax rate for
   both periods (d)                    (638)         (227)
                                -----------   -----------
 Adjusted net income            $    15,009   $    17,962        (16.4)

 Adjusted net income per
  diluted share (e)             $      0.48   $      0.46          4.3
 -----------------------
 Diluted weighted
  average shares
  outstanding:                   31,569,813    39,088,720

 Adjusted average capital
 ------------------------
 GAAP average debt              $   365,708   $   163,687
 GAAP average shareholders'
  equity                            209,927       359,172
 Floating Yield adjustment            6,406         7,364
 License fee yield
  adjustment                         (8,082)       (5,197)
                                -----------   -----------
     Adjusted average
      capital                   $   573,959   $   525,026          9.3
                                ===========   ===========

 Adjusted return on
  capital
 ------------------
 Adjusted net income            $    15,009   $    17,962
 GAAP interest expense
  after-tax (f)                       5,203         1,811
                                -----------   -----------

 Adjusted net income plus
   interest expense
   after-tax                    $    20,212   $    19,773          2.2
                                ===========   ===========
 Adjusted return on
  capital (g)                          14.1%         15.1%        (6.6)



 (a)  On December 30, 2005, the Company sold the remaining
      consumer loan portfolio of its United Kingdom subsidiary.
 (b)  A currency exchange gain was recognized during the fourth
      quarter of 2005 following the determination that the
      liquidation of business in Canada was substantially complete.
      The Company expects items of this nature to be non-recurring.
 (c)  The Company provided for $11.2 million of additional legal
      expenses related to an increase in its loss related to a class
      action lawsuit in the state of Missouri ($7.0 million
      after-tax).  The Company expects litigation of this size and
      nature to be infrequent.
 (d)  This adjustment allows the reader to compare the current
      period to the prior period assuming a comparable tax rate in
      both periods.  The Company approximates a long term effective
      tax rate of 37%.
 (e)  Adjusted net income per diluted share is calculated by dividing
      adjusted net income by the diluted weighted average number of
      shares outstanding.
 (f)  Interest expense after-tax calculated using a 37% tax rate.
 (g)  Adjusted return on capital is defined as annualized adjusted
      net income plus interest expense after-tax divided by adjusted
      average capital.

For the three months ended December 31, 2006 compared to the same period in 2005, adjusted net income plus interest expense after-tax increased 2.2% while adjusted average capital increased 9.3%. The adjusted return on capital for the three months ended December 31, 2006 was 14.1% compared to 15.1% for the same period in 2005. The 100 basis point decrease is primarily due to:

i) a 60 basis point increase in expenses, as a percentage of adjusted average capital, primarily related to lower than normal accounting fees in the fourth quarter of 2005 as a result of the resolution of a dispute over fees paid to a former auditor, and

ii) a 30 basis point increase in expenses, as a percentage of adjusted average capital, related to the timing of the Company's annual dealer-partner convention. The 2006 convention was held in the fourth quarter of 2006 while the 2005 convention was held in the third quarter of 2005.



 Change in License Fees
 ----------------------

The Company has historically charged dealer-partners a per month license fee for access to the Company's loan origination software. In accordance with GAAP, this fee has historically been recorded as revenue in the month the fee is charged. Based on feedback received from field sales personnel and dealer-partners, the Company concluded that the way this fee was structured was a significant factor driving higher than desired dealer-partner attrition. Effective January 1, 2007, the Company implemented a change designed to positively impact dealer-partner attrition. The Company will continue to charge a monthly fee of $599 but, instead of collecting the license fee in the current period, the Company will collect the license fee from future dealer holdback payments.

As a result of this change, per unit returns on capital in the future will be lower as cash flow from license fees will be collected on a deferred basis. This change is the primary driver behind the expected 25 basis point reduction in adjusted return on capital on 2007 originations referenced above. The Company initiated this change because it expects it to also produce higher unit volumes and, as a result, higher economic profit than the Company would have without it.

In addition, it is no longer appropriate from either an accounting or an economic perspective to view the license fees as a current period source of revenue. As a result, starting in the first quarter of 2007, the Company will record license fees on a GAAP basis as a yield adjustment, effectively recognizing these fees over the term of the dealer loan. This GAAP treatment is consistent with the cash economics.

Because the Company will be deferring revenue that was previously recorded immediately, the Company's GAAP financial statements in the near future will be difficult to compare to prior periods for two reasons:


 1. As stated above, beginning in the first quarter of 2007, license
    fees charged will be recognized as revenue over the life of the
    dealer loan as a yield adjustment, while prior to 2007, license
    fees were recognized as revenue in the quarter they were charged.
    This will have the effect in future quarters of reducing license
    fee revenue from what it was in 2006, as only a small portion of
    license fees will now be recorded as revenue in the quarter they
    are charged to dealer-partners.
 2. Had the Company always accounted for license fees as a yield
    adjustment, this reduction in revenue (outlined immediately
    above) would be substantially offset by revenue from license
    fees charged to dealer-partners in periods prior to 2007.
    However, since all license fees prior to 2007 have already been
    recognized as revenue in the period they were charged, it will
    be some time before this offset occurs in the Company's GAAP
    financial statements.

To allow shareholders to more precisely track the Company's financial performance and make comparisons between periods possible, the Company will provide, through the adjusted financial results section, financial results assuming license fees had always been recorded as a yield adjustment. This change is reflected in the license fee yield adjustment in the adjusted financial results tables above.


 Floating Yield Adjustment
 -------------------------

The Company's GAAP finance charge revenue is based on estimates of future cash flows and is recognized on a level yield basis. Under the level yield basis, the amount of finance charge revenue recognized in a given period, divided by the loan asset, is a constant percentage. Under GAAP, favorable changes in expected cash flows are treated as increases to the level yield and are recognized over time, while unfavorable changes are recorded as a current period expense. The non-GAAP measure ("Floating Yield") is identical to the Company's GAAP results except that, under the Floating Yield method, all changes in expected cash flows are treated as yield adjustments and therefore impact earnings over time. The GAAP treatment always results in a lower carrying value of the loan receivable asset, but may result in either higher or lower earnings for any given period depending on the timing and amount of expected cash flow changes. Management believes Floating Yield earnings are a more accurate reflection of the economics of the business since both favorable and unfavorable changes in estimated cash flows are treated consistently.



 Consumer Loan Performance
 -------------------------

Although the majority of loan originations are recorded in the Company's financial statements as dealer loans, each transaction starts with a loan from the dealer-partner to the individual purchasing the vehicle. Since the cash flows available to repay the dealer loans are generated, in most cases, from the underlying consumer loan, the performance of the consumer loans is critical to the Company's financial results. The following table presents forecasted consumer loan collection rates, advance rates, the spread (the forecasted collection rate less the advance rate), and the percentage of the forecasted collections that have been realized as of December 31, 2006 for the United States business segment. Payments of dealer holdback and accelerated payments of dealer holdback are not included in the analysis of the initial advance paid to the dealer-partner. All amounts are presented as a percentage of the initial balance of the consumer loan (principal + interest).



                                    As of December 31, 2006
                ------------------------------------------------------
    Year of      Forecasted                              % of Forecast
  Origination    Collection %   Advance %     Spread %      Realized
  -----------   ------------   ----------    ---------   -------------
    1996           55.1%         46.9%          8.2%          100.0%
    1997           58.4%         47.8%         10.6%           99.8%
    1998           67.5%         46.0%         21.5%           99.2%
    1999           72.4%         48.7%         23.7%           98.4%
    2000           73.0%         47.9%         25.1%           97.6%
    2001           67.7%         46.0%         21.7%           97.2%
    2002           70.7%         42.2%         28.5%           96.9%
    2003           74.2%         43.4%         30.8%           95.0%
    2004           73.9%         44.0%         29.9%           83.6%
    2005           73.8%         46.9%         26.9%           63.1%
    2006           70.5%         46.6%         23.9%           22.0%

The following table compares the Company's forecast of consumer loan collection rates as of December 31, 2006 with the forecast as of December 31, 2005:



                 December 31, 2006    December 31, 2005
   Year of           Forecasted           Forecasted
  Origination        Collection %         Collection %       Variance
 -------------    ------------------    -----------------   ----------
     1996                 55.1%               55.0%             0.1%
     1997                 58.4%               58.3%             0.1%
     1998                 67.5%               67.7%            (0.2%)
     1999                 72.4%               72.7%            (0.3%)
     2000                 73.0%               73.2%            (0.2%)
     2001                 67.7%               67.2%             0.5%
     2002                 70.7%               70.3%             0.4%
     2003                 74.2%               74.0%             0.2%
     2004                 73.9%               72.9%             1.0%
     2005                 73.8%               73.6%             0.2%
     2006                 70.5%               71.4%*           (0.9%)

* Collection percentage represents the initial forecasted collections percentage determined at origination for 2006 originations.

Collection results during the twelve months ended December 31, 2006 generally exceeded the Company's expectations at December 31, 2005 and had a positive impact on forecasted consumer loan collection rates.

The following table compares the Company's forecast of consumer loan collection rates as of December 31, 2006 with the forecast as of September 30, 2006:


                 December 31, 2006    September 30, 2006
   Year of          Forecasted            Forecasted
  Origination       Collection %         Collection %        Variance
 -------------   -----------------   -------------------    ----------
     1996               55.1%               55.1%                0.0%
     1997               58.4%               58.4%                0.0%
     1998               67.5%               67.6%               (0.1%)
     1999               72.4%               72.5%               (0.1%)
     2000               73.0%               73.0%                0.0%
     2001               67.7%               67.6%                0.1%
     2002               70.7%               70.6%                0.1%
     2003               74.2%               74.4%               (0.2%)
     2004               73.9%               73.9%                0.0%
     2005               73.8%               74.3%               (0.5%)
     2006               70.5%               71.7%               (1.2%)

 Cautionary Statement Regarding Forward-Looking Information
 ----------------------------------------------------------

The Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for all of its forward-looking statements. Certain statements in this release that are not historical facts, such as those using terms like "may," "will," "should," "believes," "expects," "anticipates," "assumes," "forecasts," "estimates," "intends," "plans" and those regarding the Company's future results, plans and objectives, are "forward-looking statements" within the meaning of the federal securities laws. These forward-looking statements represent the Company's outlook only as of the date of this release. While the Company believes that its forward-looking statements are reasonable, actual results could differ materially since the statements are based on our current expectations, which are subject to risks and uncertainties. Factors that might cause such a difference include, but are not limited to, the factors set forth in Item 1A of the Company's Form 10-K for the year ended December 31, 2005, other risk factors discussed herein or listed from time to time in the Company's reports filed with the Securities and Exchange Commission and the following:



 --  The Company's inability to accurately forecast the amount and
     timing of future collections could have a material adverse
     effect on results of operations.
 --  Due to increased competition from traditional financing sources
     and non-traditional lenders, the Company may not be able to
     compete successfully.
 --  The Company's ability to maintain and grow the business is
     dependent on the ability to continue to access funding sources
     and obtain capital on favorable terms.
 --  The Company may not be able to generate sufficient cash flow
     to service its outstanding debt and fund operations.
 --  The substantial regulation to which the Company is subject
     limits the business, and such regulation or changes in such
     regulation could result in potential liability.
 --  Adverse changes in economic conditions, or in the automobile or
     finance industries or the non-prime consumer finance market,
     could adversely affect the Company's financial position,
     liquidity and results of operations and its ability to enter
     into future financing transactions.
 --  Litigation the Company is involved in from time to time may
     adversely affect its financial condition, results of operations
     and cash flows.
 --  The Company is dependent on its senior management and the loss
     of any of these individuals or an inability to hire additional
     personnel could adversely affect its ability to operate
     profitably.
 --  Natural disasters, acts of war, terrorist attacks and threats
     or the escalation of military activity in response to such
     attacks or otherwise may negatively affect the business,
     financial condition and results of operations.

Other factors not currently anticipated by management may also materially and adversely affect the Company's results of operations. The Company does not undertake, and expressly disclaims any obligation, to update or alter its statements whether as a result of new information, future events or otherwise, except as required by applicable law.


 Description of Credit Acceptance Corporation
 ============================================

Since 1972, Credit Acceptance has provided auto loans to consumers, regardless of their credit history. Our product is offered through a nationwide network of automobile dealers who benefit from sales of vehicles to consumers who otherwise could not obtain financing; from repeat and referral sales generated by these same customers; and from sales to customers responding to advertisements for our product, but who actually end up qualifying for traditional financing.

Without our product, consumers may be unable to purchase a vehicle or they may purchase an unreliable one, or they may not have the opportunity to improve their credit standing. As we report to the three national credit reporting agencies, a significant number of our customers improve their lives by improving their credit score and move on to more traditional sources of financing. Credit Acceptance is publicly traded on the NASDAQ under the symbol CACC. For more information, visit creditacceptance.com.



                         CREDIT ACCEPTANCE CORPORATION
                           CONSOLIDATED BALANCE SHEETS

 (Dollars in thousands,
  except per share data)

                                                      December 31,
                                                ----------------------
                                                    2006       2005
                                                (Unaudited)
                                                -----------  ---------

                    ASSETS:
 Cash and cash equivalents                      $   8,528   $   7,090
 Restricted cash and cash equivalents              45,609      13,473
 Restricted securities available for sale           3,564       3,345

 Loans receivable (including $23,038 and
  $24,765 from affiliates as of
  December 31, 2006 and 2005,
  respectively)                                   754,571     694,939
 Allowance for credit losses                     (128,791)   (131,411)
                                                ---------   ---------

 Loans receivable, net                            625,780     563,528
                                                ---------   ---------

 Property and equipment, net                       16,203      17,992
 Income taxes receivable                           11,734       4,022
 Other assets                                      13,795       9,944
                                                ---------   ---------

 Total Assets                                   $ 725,213   $ 619,394
                                                =========   =========


        LIABILITIES AND SHAREHOLDERS' EQUITY:
 Liabilities:
 Accounts payable and accrued liabilities       $  78,294   $  55,705
 Line of credit                                    38,400      36,300
 Secured financing                                345,144     101,500
 Mortgage note and capital lease obligations        8,631       9,105
 Deferred income taxes, net                        44,397      43,758
                                                ---------   ---------
 Total Liabilities                                514,866     246,368
                                                ---------   ---------

 Shareholders' Equity:
 Preferred stock, $.01 par value, 1,000,000
  shares authorized, none issued                      --          --
 Common stock, $.01 par value, 80,000,000 shares
  authorized, 30,179,959and 37,027,286 shares
  issued and outstanding at December 31, 2006
  and 2005, respectively                              302         370
 Paid-in capital                                      330      29,746
 Unearned stock-based compensation                 (2,260)     (1,566)
 Retained earnings                                212,011     344,513
 Accumulated other comprehensive loss, net of
  tax of $19 and $22 at December 31, 2006 and
  2005, respectively                                  (36)        (37)
                                                ---------   ---------
 Total Shareholders' Equity                       210,347     373,026
                                                ---------   ---------
 Total Liabilities and Shareholders' Equity     $ 725,213   $ 619,394
                                                =========   =========

                         CREDIT ACCEPTANCE CORPORATION
                         CONSOLIDATED INCOME STATEMENTS
 (Dollars in thousands,
  except per share data)

                        Three Months Ended      Twelve Months Ended
                            December 31,             December 31,
                     -----------------------   -----------------------
                            (Unaudited)              (Unaudited)
                        2006         2005         2006         2005
                     ----------   ----------   ----------   ----------

 Revenue:
 Finance charges       $ 47,205     $ 44,989    $ 188,605    $ 176,369
 License fees             3,889        2,905       13,589        9,775
 Other income             4,729        3,679       17,138       15,124
                     ----------   ----------   ----------   ----------
 Total revenue           55,823       51,573      219,332      201,268
                     ----------   ----------   ----------   -----------
 Costs and
  expenses:
 Salaries and
  wages                   9,548        9,834       41,015       39,093
 General and
  administrative         17,360        3,979       36,485       20,834
 Sales and
  marketing               4,917        3,319       16,624       14,275
 Provision for
  credit losses           3,437       (1,668)      11,006        5,705
 Interest                 8,259        2,875       23,330       13,886
 Other expense               49           41          226          931
                     ----------   ----------   ----------   ----------
 Total costs and
  expenses               43,570       18,380      128,686       94,724
                     ----------   ----------   ----------   ----------
 Operating income        12,253       33,193       90,646      106,544
 Foreign exchange
  (loss) gain               (18)         793           (6)       1,812
                     ----------   ----------   ----------   ----------
 Income from
  continuing
  operations
  before provision
  for income taxes       12,235       33,986       90,640      108,356
 Provision for
  income taxes            3,726       11,871       31,793       40,159
                     ----------   ----------   ----------   ----------
 Income from
  continuing
  operations              8,509       22,115       58,847       68,197
                     ----------   ----------   ----------   ----------
 Discontinued
   operations
 (Loss) gain from
  operations of
  discontinued
  United Kingdom
  segment before
  provision for
  income taxes              (20)       4,387         (297)       6,194
 (Benefit)
  provision for
  income taxes               (6)       1,262          (90)       1,790
                     ----------   ----------   ----------   ----------
 (Loss) gain on
  discontinued
  operations                (14)       3,125         (207)       4,404
                     ----------   ----------   ----------   ----------
 Net income          $    8,495   $   25,240   $   58,640   $   72,601
                     ==========   ==========   ==========   ==========
 Net income per
  common share:
 Basic               $     0.28   $     0.68   $     1.78   $     1.96
                     ==========   ==========   ==========   ==========
  Diluted            $     0.27   $     0.65   $     1.66   $     1.85
                     ==========   ==========   ==========   ==========
 Income from
  continuing
  operations per
  common share:
 Basic               $     0.28   $     0.60   $     1.78   $     1.84
                     ==========   ==========   ==========   ==========
 Diluted             $     0.27   $     0.57   $     1.67   $     1.74
                     ==========   ==========   ==========   ==========
 (Loss) gain from
  discontinued
  operations per
  common share:
 Basic               $     --     $     0.08   $    (0.01)  $     0.12
                     ==========   ==========   ==========   ==========
 Diluted             $     --     $     0.08   $    (0.01)  $     0.11
                     ==========   ==========   ==========   ==========
 Weighted average
  shares
  outstanding:
 Basic               29,921,196   37,025,517   33,035,693   36,991,136
 Diluted             31,569,813   39,088,720   35,283,478   39,207,680

This news release was distributed by PrimeNewswire, www.primenewswire.com

SOURCE: Credit Acceptance Corporation

Credit Acceptance Corporation 
          Investor Relations:
          Douglas W. Busk, Treasurer
          (248) 353-2700 Ext. 4432
          IR@creditacceptance.com

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