Exhibit 99.1
Cash America Announces First Quarter Earnings and Declares Dividend
FORT WORTH, Texas--(BUSINESS WIRE)--April 23, 2009--Cash America International, Inc. (NYSE: CSH) announced today that net income for the first quarter ended March 31, 2009 was $23,911,000 (79 cents per share) compared to net income of $25,811,000 (86 cents per share) for the same period in 2008. Earnings per share for the first three months of 2009 exceeded management’s updated guidance of 76 to 78 cents per share as discussed in the Company’s press release dated April 9, 2009 and even though earnings ended down 7% year over year, they are significantly better than management’s initial expectation published in January 2009 of down 25%. Increased total revenue, led by better than expected results from pawn lending operations and prolonged availability of certain online cash advance markets contributed to the higher than expected first quarter results. In addition, earnings in the first quarter of 2009 benefited from an improvement in loss rates related to the Company’s short-term cash advance product that led to a decrease in the provision for loan losses in the period compared to the same period in 2008.
Total revenue increased 7% to $268.1 million for the three-month period ended March 31, 2009 compared to $250.9 million in the year ago period. Revenue from the Company’s pawn segment, which includes finance and service charges on pawn loans and proceeds from the sale of merchandise, increased 14% to $182.7 million from $160.0 million in year-over-year first quarter comparisons. This was partially offset by a decline in the total revenue from the Company’s cash advance segment, which posted a 6% decrease in total revenue to $80.3 million during the first three months of 2009 compared to $85.5 million in the same period in 2008. The decline in revenue in the cash advance segment was largely attributable to operations in states impacted by changes in the regulatory environment late in 2008.
Commenting on the first quarter results, Daniel R. Feehan, President and Chief Executive Officer of Cash America said, “The first quarter results were above our initial expectations due to the strong contribution of both our U.S. and Mexico based pawn operations and the unexpected continuation of our online cash advance offering in certain states. Revenue from pawn loans was up 22% because of the higher balances outstanding and portfolio performance, which led the greater earnings results in this segment. As we expected, revenue and earnings from our cash advance segment were adversely affected by rule changes to our cash advance product offering in Ohio and Florida and to a lesser extent in Pennsylvania. The first quarter of 2009 has been a period of significant adjustment which we have handled better than we expected.”
Cash America will host a conference call to discuss the first quarter results on Thursday, April 23rd at 7:45 AM CDT. A live web cast of the call will be available on the Investor Relations section of the Company’s corporate web site (www.cashamerica.com). To listen to the live call, please go to the web site at least fifteen minutes early to register, download, and install any necessary audio software. A replay will be available on the Company’s web site for 90 days following the conference call.
Additionally, the Company announced that the Board of Directors, at its regularly scheduled quarterly meeting, declared a $0.035 (3.5 cents) per share cash dividend on common shares outstanding. The dividend will be paid at the close of business on May 20, 2009 to shareholders of record on May 6, 2009.
Outlook for the Second Quarter of 2009 and the 2009 Fiscal Year
Management believes that the opportunities for sustained growth in revenue and earnings will be largely associated with the customer demand for the credit products provided by the Company, which take the form of pawn loans and short-term cash advances. Other elements expected to affect the growth in revenue include the potential impact of the regulatory governance of loan products, the continued growth and development of the Mexican pawn operations and the development and expansion of the Company’s online and card based distribution channels for its cash advance products. The impact of regulatory changes in our Ohio storefront locations and the anticipated decrease in customers in Pennsylvania and Minnesota in the online channel will cause revenue and earnings for the cash advance segment to be down in the second quarter. In addition, the absence of Federal Stimulus Payments will likely cause revenue and earnings from U.S. pawn operations to be below the prior year. However, management believes the anniversary revenue challenges discussed for the first half of 2009 could begin to improve in the second half of the year if loan demand firms for both pawn and cash advance products. While the Company intends to maintain its current underwriting standards, higher loan demand for the cash advance product could lead to higher loan losses associated with the difficult consumer economic environment. Based on its views and on the preceding factors, management expects that the second quarter 2009 earnings per share will be between 50 and 53 cents per share compared to 67 cents per share in the second quarter 2008. Management estimates that for the full year 2009 earnings per share will be between $3.10 and $3.30 per share compared to $2.70 per share in fiscal 2008.
Cash America International, Inc. is a provider of specialty financial services to individuals in the United States with 1,004 total locations as of March 31, 2009. Cash America is the largest provider of secured non-recourse loans to individuals, commonly referred to as pawn loans, through 628 total pawn locations, comprised, in part, of 501 in 22 states under the brand names Cash America Pawn and SuperPawn. In addition, Cash America is the majority owner of 127 pawn lending locations in Mexico that operate under the name of Prenda Fácil. The Company also offers short-term cash advances in many of its locations including 248 locations that offer this service under the brand names Cash America Payday Advance and Cashland. Short-term cash advances are also offered over the Internet to customers in 32 states in the United States and in the United Kingdom at http://www.cashnetusa.com and http://www.quickquid.co.uk, respectively. In addition, check cashing services are provided through its 128 franchised and Company-owned “Mr. Payroll” check cashing centers.
For additional information regarding the Company and the services it provides, visit the Company’s websites located at:
http://www.cashamerica.com http://www.cashnetusa.com
http://www.cashlandloans.com http://www.quickquid.co.uk
http://www.strikegoldnow.com
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This release contains forward-looking statements about the business, financial condition and prospects of Cash America International, Inc. and its subsidiaries (the “Company”). The actual results of the Company could differ materially from those indicated by the forward-looking statements because of various risks and uncertainties including, without limitation, changes in consumer credit, tax and other laws and government rules and regulations applicable to the Company’s business, changes in demand for the Company's services, the continued acceptance of the online distribution channel by the Company’s cash advance customers, the actions of third parties who offer products and services at the Company’s locations, changes in tax and other laws and governmental rules and regulations applicable to the Company’s business, fluctuations in the price of gold, changes in competition, the ability of the Company to open new operating units in accordance with its plans, economic conditions, real estate market fluctuations, interest rate fluctuations, changes in foreign currency exchange rates, changes in the capital markets, the ability to successfully integrate newly acquired businesses into the Company’s operations and other risks indicated in the Company's filings with the Securities and Exchange Commission. These risks and uncertainties are beyond the ability of the Company to control, nor can the Company predict all of the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements. When used in this release, terms such as “believes,” “estimates,” “should,” “could” “plans,” “expects,” “anticipates” and similar expressions or variations as they relate to the Company or its management are intended to identify forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements to reflect events or circumstances occurring after the date of this release.
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||
HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS | ||||||
(in thousands, except per share data) | ||||||
Three Months Ended | ||||||
March 31, | ||||||
2009 | 2008 | |||||
Consolidated Operations: | ||||||
Total revenue | $ | 268,092 | $ | 250,934 | ||
Net revenue | 185,590 | 179,418 | ||||
Total operating expenses | 142,111 | 134,946 | ||||
Income from operations | $ | 43,479 | $ | 44,472 | ||
Income before income taxes | 38,289 | 40,990 | ||||
Net Income | $ | 24,226 | $ | 25,811 | ||
Less: Net income attributable to the noncontrolling interest | (315 | ) | - | |||
Net Income Attributable to Cash America International, Inc. | $ | 23,911 | $ | 25,811 | ||
Earnings per share: | ||||||
Net Income attributable to Cash America International, Inc. common stockholders: | ||||||
Basic | $ | 0.80 | $ | 0.88 | ||
Diluted | $ | 0.79 | $ | 0.86 | ||
Weighted average shares: | ||||||
Basic | 29,770 | 29,376 | ||||
Diluted | 30,419 | 29,995 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||||
(in thousands, except share data) | ||||||||||||
March 31, | December 31, | |||||||||||
2009 | 2008 | 2008 | ||||||||||
(Unaudited) | ||||||||||||
Assets | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 25,676 | $ | 22,637 | $ | 30,005 | ||||||
Pawn loans | 148,147 | 124,775 | 168,747 | |||||||||
Cash advances, net | 75,880 | 74,179 | 83,850 | |||||||||
Merchandise held for disposition, net | 99,516 | 93,027 | 109,493 | |||||||||
Finance and service charges receivable | 28,709 | 24,496 | 33,063 | |||||||||
Income taxes recoverable | - | - | 2,606 | |||||||||
Other receivables and prepaid expenses | 19,028 | 17,944 | 15,480 | |||||||||
Deferred tax assets | 19,301 | 19,198 | 22,037 | |||||||||
Total current assets | 416,257 | 376,256 | 465,281 | |||||||||
Property and equipment, net | 186,622 | 168,586 | 185,887 | |||||||||
Goodwill | 489,779 | 347,434 | 494,192 | |||||||||
Intangible assets, net | 31,456 | 22,424 | 35,428 | |||||||||
Other assets | 5,498 | 5,185 | 5,722 | |||||||||
Total assets | $ | 1,129,612 | $ | 919,885 | $ | 1,186,510 | ||||||
Liabilities and Stockholders’ Equity | ||||||||||||
Current liabilities: | ||||||||||||
Accounts payable and accrued expenses | $ | 69,288 | $ | 60,921 | $ | 79,759 | ||||||
Accrued supplemental acquisition payment | 7,700 | 63,213 | 47,064 | |||||||||
Customer deposits | 10,133 | 8,682 | 8,814 | |||||||||
Income taxes currently payable | 3,687 | 12,196 | - | |||||||||
Current portion of long-term debt | 18,714 | 8,500 | 15,810 | |||||||||
Total current liabilities | 109,522 | 153,512 | 151,447 | |||||||||
Deferred tax liabilities | 31,042 | 20,482 | 27,575 | |||||||||
Noncurrent income tax payable | 2,968 | - | 3,050 | |||||||||
Other liabilities | 3,942 | 1,806 | 2,359 | |||||||||
Long-term debt | 380,902 | 224,970 | 422,344 | |||||||||
Total liabilities | 528,376 | 400,770 | 606,775 | |||||||||
Stockholders’ equity: | ||||||||||||
Cash America International, Inc. equity: | ||||||||||||
Common stock, $.10 par value per share, 80,000,000 shares authorized, 30,235,164 shares issued | ||||||||||||
3,024 | 3,024 | 3,024 | ||||||||||
Additional paid-in capital | 158,216 | 162,240 | 160,007 | |||||||||
Retained earnings | 463,131 | 387,970 | 440,252 | |||||||||
Accumulated other comprehensive loss | (6,107 | ) | (1 | ) | (3,964 | ) | ||||||
Treasury shares, at cost (753,207 shares, 1,161,482 shares and 818,772 shares at March 31, 2009 and 2008, and at December 31, 2008, respectively) | ||||||||||||
(21,919 | ) | (34,118 | ) | (24,278 | ) | |||||||
Total Cash America International, Inc. stockholders’ equity | 596,345 | 519,115 | 575,041 | |||||||||
Noncontrolling interest | 4,891 | - | 4,694 | |||||||||
Total stockholders' equity | 601,236 | 519,115 | 579,735 | |||||||||
Total liabilities and stockholders’ equity | $ | 1,129,612 | $ | 919,885 | $ | 1,186,510 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||
(in thousands, except per share data) | ||||||||
Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
(Unaudited) | ||||||||
Revenue | ||||||||
Finance and service charges | $ | 52,959 | $ | 43,421 | ||||
Proceeds from disposition of merchandise | 129,760 | 116,583 | ||||||
Cash advance fees | 80,308 | 85,460 | ||||||
Check cashing fees, royalties and other | 5,065 | 5,470 | ||||||
Total Revenue | 268,092 | 250,934 | ||||||
Cost of Revenue | ||||||||
Disposed merchandise | 82,502 | 71,516 | ||||||
Net Revenue | 185,590 | 179,418 | ||||||
Expenses | ||||||||
Operations | 85,531 | 80,725 | ||||||
Cash advance loss provision | 24,774 | 27,134 | ||||||
Administration | 21,465 | 17,956 | ||||||
Depreciation and amortization | 10,341 | 9,131 | ||||||
Total Expenses | 142,111 | 134,946 | ||||||
Income from Operations | 43,479 | 44,472 | ||||||
Interest expense | (5,069 | ) | (3,509 | ) | ||||
Interest income | 15 | 31 | ||||||
Foreign currency transaction loss | (136 | ) | (4 | ) | ||||
Income before Income Taxes | 38,289 | 40,990 | ||||||
Provision for income taxes | 14,063 | 15,179 | ||||||
Net Income | 24,226 | 25,811 | ||||||
Less: Net income attributable to the noncontrolling interest | (315 | ) | - | |||||
Net Income Attributable to Cash America International, Inc. | $ | 23,911 | $ | 25,811 | ||||
Earnings Per Share: | ||||||||
Net Income attributable to Cash America International, Inc. common stockholders: | ||||||||
Basic | $ | 0.80 | $ | 0.88 | ||||
Diluted | $ | 0.79 | $ | 0.86 | ||||
Weighted average common shares outstanding: | ||||||||
Basic | 29,770 | 29,376 | ||||||
Diluted | 30,419 | 29,995 | ||||||
Dividends declared per common share | $ | 0.035 | $ | 0.035 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||
FINANCIAL AND OPERATING DATA | ||||
($ in thousands unless otherwise noted) | ||||
Period Ended | ||||
March 31, | ||||
2009 | 2008 | |||
Location statistics | ||||
Pawn segment locations in operation – | ||||
Beginning of period, owned | 598 | 485 | ||
Acquired | 1 | - | ||
Start-ups | 14 | - | ||
Combined or closed | - | - | ||
End of period, owned | 613 | 485 | ||
Franchise locations at end of period | 15 | 14 | ||
Total pawnshop locations at end of period | 628 | 499 | ||
Average number of owned pawnshop locations | 605 | 485 | ||
Cash advance segment locations in operation (excluding online lending and card services) –
| ||||
Beginning of period | 248 | 304 | ||
Start-ups | - | - | ||
Combined or closed | - | - | ||
End of period | 248 | 304 | ||
Average number of cash advance locations | 248 | 304 | ||
Check cashing segment locations - | ||||
Company-owned locations | 5 | 5 | ||
Franchised locations (a) | 123 | 131 | ||
Total check cashing centers in operation at end of year (a) | 128 | 136 | ||
Combined total of all locations | 1,004 | 939 | ||
Services offered by locations | ||||
Pawn lending - | ||||
Pawn lending segment : | ||||
Domestic | 486 | 485 | ||
Foreign | 127 | - | ||
Franchise - domestic | 15 | 14 | ||
Combined pawn lending segment | 628 | 499 | ||
Cash advance segment - storefront operations | 85 | - | ||
Total locations offering pawn lending | 713 | 499 | ||
Cash advances - | ||||
Cash advance segment - storefront operations | 248 | 304 | ||
Pawn lending segment -domestic | 431 | 430 | ||
Total locations offering cash advances | 679 | 734 | ||
Check cashing - | ||||
Check cashing segment | ||||
Company-owned locations | 5 | 5 | ||
Franchised locations (a) | 123 | 131 | ||
Total check cashing segment | 128 | 136 | ||
Cash advance segment - storefront operations | 248 | 304 | ||
Pawn lending segment -domestic | 369 | 387 | ||
Total locations offering check cashing | 745 | 827 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||
FINANCIAL AND OPERATING DATA (Continued) | ||||||
($ in thousands unless otherwise noted) | ||||||
Three Months Ended | ||||||
March 31, | ||||||
2009 | 2008 | |||||
Market coverage | ||||||
Market coverage for pawn lending at end of period | ||||||
States in the U.S. | 22 | 22 | ||||
Foreign countries | 1 | - | ||||
Market coverage for cash advances at end of period | ||||||
States and other jurisdictions in the U.S. | ||||||
Storefront | 7 | 7 | ||||
Online | 32 | 33 | ||||
Card services | 52 | - | ||||
Foreign countries | ||||||
Online | 1 | 1 | ||||
Pawn Lending Activities | ||||||
Annualized yield on pawn loans -- | ||||||
Pawn lending segment : | ||||||
Domestic | 135.7 | % | 135.0 | % | ||
Foreign | 158.5 | % | - | % | ||
Combined pawn lending segment | 138.1 | % | 135.0 | % | ||
Cash advance segment - storefront operations | 112.6 | % | - | % | ||
Combined annualized yield on pawn loans | 138.1 | % | 135.0 | % | ||
Amount of pawn loans written and renewed -- | ||||||
Pawn lending segment : | ||||||
Domestic | $ | 136,032 | $ | 131,981 | ||
Foreign | 23,809 | - | ||||
Combined pawn lending segment | $ | 159,841 | $ | 131,981 | ||
Cash advance segment - storefront operations | 72 | - | ||||
Combined amount of pawn loans written and renewed | $ | 159,913 | $ | 131,981 | ||
Average pawn loan balance outstanding -- | ||||||
Pawn lending segment : | ||||||
Domestic | $ | 138,938 | $ | 129,349 | ||
Foreign | 16,541 | - | ||||
Combined pawn lending segment | 155,479 | 129,349 | ||||
Cash advance segment - storefront operations | 18 | - | ||||
Combined average pawn loan balance outstanding | $ | 155,497 | $ | 129,349 | ||
Ending pawn loan balance -- | ||||||
Pawn lending segment : | ||||||
Domestic | $ | 130,558 | $ | 124,775 | ||
Foreign | 17,518 | - | ||||
Combined pawn lending segment | 148,076 | 124,775 | ||||
Cash advance segment - storefront operations | 71 | - | ||||
Combined ending pawn loan balance per location offering pawn loans | $ | 148,147 | $ | 124,775 | ||
Ending pawn loan balance per location offering pawn loans -- | ||||||
Pawn lending segment : | ||||||
Domestic | $ | 269 | $ | 257 | ||
Foreign | $ | 138 | $ | - | ||
Combined pawn lending segment | $ | 242 | $ | 257 | ||
Cash advance segment - storefront operations | $ | 1 | $ | - | ||
Combined ending pawn loan balance per location offering pawn loans | $ | 212 | $ | 257 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | |||||||
FINANCIAL AND OPERATING DATA (Continued) | |||||||
($ in thousands unless otherwise noted) | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2009 | 2008 | ||||||
Average pawn loan amount at end of period (not in thousands) -- | |||||||
Pawn lending segment : | |||||||
Domestic | $ | 122 | $ | 117 | |||
Foreign | $ | 93 | $ | - | |||
Combined pawn lending segment | $ | 118 | $ | 117 | |||
Cash advance segment - storefront operations | $ | 90 | $ | - | |||
Combined average pawn loan amount at end of period (not in thousands) | $ | 118 | $ | 117 | |||
Disposition of merchandise -- | |||||||
Profit margin on disposition of merchandise | |||||||
Pawn lending segment - domestic | 36.5 | % |
| 38.7 | % | ||
Cash advance segment - storefront operations | 33.2 | - | |||||
Combined profit margin on disposition of merchandise | 36.4 | % |
| 38.7 | % | ||
Disposition of merchandise - pawn lending segment - domestic -- | |||||||
Average annualized merchandise turnover | 3.1 | x |
| 3.0 | x | ||
Average balance of merchandise held for disposition per average location in operation | |||||||
$ | 216 | $ | 199 | ||||
Ending balance of merchandise held for disposition per location in operation | |||||||
$ | 205 | $ | 192 | ||||
Cash advance activities | |||||||
Amount of cash advances written -- | |||||||
Funded by the Company | |||||||
Cash advance segment: | |||||||
Storefront | $ | 137,757 | $ | 153,062 | |||
Internet lending | 157,709 | 159,921 | |||||
Total cash advance segment | $ | 295,466 | $ | 312,983 | |||
Pawn lending segment - domestic | 13,880 | 13,947 | |||||
Combined funded by the Company | $ | 309,346 | $ | 326,930 | |||
Funded by third-party lenders (a) (b) | |||||||
Cash advance segment: | |||||||
Storefront | $ | 20,114 | $ | 25,564 | |||
Internet lending | 107,918 | 98,543 | |||||
Card services (e) | 19,787 | - | |||||
Total cash advance segment | $ | 147,819 | $ | 124,107 | |||
Pawn lending segment - domestic | 30,764 | 37,996 | |||||
Combined funded by third-party lenders (a) (b) | $ | 178,583 | $ | 162,103 | |||
Aggregate amount of cash advances written(a) (c) - | |||||||
Cash advance segment: | |||||||
Storefront | $ | 157,871 | $ | 178,626 | |||
Internet lending | 265,627 | 258,464 | |||||
Card services (e) | 19,787 | - | |||||
Total cash advance segment | $ | 443,285 | $ | 437,090 | |||
Pawn lending segment - domestic | 44,644 | 51,943 | |||||
Combined aggregate amount of cash advances written(a) (g) | $ | 487,929 | $ | 489,033 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||
FINANCIAL AND OPERATING DATA (Continued) | ||||||
($ in thousands unless otherwise noted) | ||||||
Three Months Ended | ||||||
March 31, | ||||||
2009 | 2008 | |||||
Number of cash advances written (not in thousands) - | ||||||
Funded by the Company | ||||||
Cash advance segment: | ||||||
Storefront | 309,849 | 418,597 | ||||
Internet lending | 390,023 | 389,416 | ||||
Total cash advance segment | 699,872 | 808,013 | ||||
Pawn lending segment - domestic | 41,835 | 45,146 | ||||
Combined by the Company | 741,707 | 853,159 | ||||
Funded by third-party lenders (a) (e) | ||||||
Cash advance segment: | ||||||
Storefront | 33,978 | 45,709 | ||||
Internet lending | 146,576 | 148,947 | ||||
Card services (e) | 125,160 | - | ||||
Total cash advance segment | 305,714 | 194,656 | ||||
Pawn lending segment - domestic | 56,882 | 80,389 | ||||
Combined by third-party lenders (a) (b) | 362,596 | 275,045 | ||||
Cash advance segment: | ||||||
Storefront | 343,827 | 464,306 | ||||
Internet lending | 536,599 | 538,363 | ||||
Card services (e) | 125,160 | - | ||||
Total cash advance segment | 1,005,586 | 1,002,669 | ||||
Pawn lending segment - domestic | 98,717 | 125,535 | ||||
Combined aggregate number of cash advances written (a) (c) | 1,104,303 | 1,128,204 | ||||
Cash advance customer balances (gross): | ||||||
Owned by Company (d) | ||||||
Cash advance segment: | ||||||
Storefront | $ | 31,066 | $ | 39,181 | ||
Internet lending | 51,866 | 48,961 | ||||
Card services (e) | 4,740 | - | ||||
Total cash advance segment | $ | 87,672 | $ | 88,142 | ||
Pawn lending segment - domestic | 5,486 | 6,852 | ||||
Combined by the Company | $ | 93,158 | $ | 94,994 | ||
Owned by third-party lenders (a)(b) | ||||||
Cash advance segment : | ||||||
Storefront | $ | 3,228 | $ | 4,114 | ||
Internet lending | 19,649 | 18,567 | ||||
Card services (e) | 458 | - | ||||
Total cash advance segment | $ | 23,335 | $ | 22,681 | ||
Pawn lending segment - domestic | 5,465 | 6,788 | ||||
Combined owned by third-party lenders (a)(b) | $ | 28,800 | $ | 29,469 | ||
Aggregate cash advance customer balances (gross) (a) (c) - | ||||||
Cash advance segment: | ||||||
Storefront | $ | 34,294 | $ | 43,295 | ||
Internet lending | 71,515 | 67,528 | ||||
Card services (e) | 5,198 | - | ||||
Total cash advance segment | $ | 111,007 | $ | 110,823 | ||
Pawn lending segment - domestic | 10,951 | 13,640 | ||||
Combined aggregate cash advance customer balances (gross) (a)(c) | $ | 121,958 | $ | 124,463 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | |||||||
FINANCIAL AND OPERATING DATA (Continued) | |||||||
($ in thousands unless otherwise noted) | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2009 | 2008 | ||||||
Average amount per cash advance written (not in thousands) - | |||||||
Funded by the Company | |||||||
Cash advance segment: | |||||||
Storefront | $ | 445 | $ | 366 | |||
Internet lending | $ | 404 | $ | 411 | |||
Total cash advance segment | $ | 422 | $ | 387 | |||
Pawn lending segment - domestic | $ | 332 | $ | 309 | |||
Combined by the Company | $ | 417 | $ | 383 | |||
Funded by third-party lenders (a) (b) | |||||||
Cash advance segment | |||||||
Storefront | $ | 592 | $ | 559 | |||
Internet lending | $ | 736 | $ | 662 | |||
Card services | $ | 158 | $ | - | |||
Total cash advance segment | $ | 484 | $ | 638 | |||
Pawn lending segment - domestic | $ | 541 | $ | 473 | |||
Combined by third-party lenders (a) (b) | $ | 493 | $ | 589 | |||
Aggregate average amount per cash advance (a) (c) - | |||||||
Cash advance segment: | |||||||
Storefront | $ | 459 | $ | 385 | |||
Internet lending | $ | 495 | $ | 480 | |||
Card services (e) | $ | 158 | $ | - | |||
Total cash advance segment | $ | 441 | $ | 436 | |||
Pawn lending segment - domestic | $ | 452 | $ | 414 | |||
Combined aggregate average amount per cash advance (a) (c) | $ | 442 | $ | 433 | |||
Check cashing | |||||||
Face amount of checks cashed - | |||||||
Company-owned locations: | |||||||
Check cashing segment | $ | 6,703 | $ | 7,673 | |||
Cash advance segment | 62,139 | 65,789 | |||||
Pawn lending segment | 8,077 | 11,856 | |||||
Combined company-owned locations | 76,919 | 85,318 | |||||
Franchised locations - check cashing segment (a) | 323,898 | 362,137 | |||||
Combined face amount of checks cashed (a) | $ | 400,817 | $ | 447,455 | |||
Fees collected from customers - | |||||||
Company-owned locations: | |||||||
Check cashing segment | $ | 110 | $ | 123 | |||
Cash advance segment | 1,592 | 2,016 | |||||
Pawn lending segment | 166 | 237 | |||||
Combined company-owned locations | 1,868 | 2,376 | |||||
Franchised locations - check cashing segment (a) | 4,816 | 5,370 | |||||
Combined fees collected from customers (a) | $ | 6,684 | $ | 7,746 | |||
Fees as a percentage of checks cashed - | |||||||
Company-owned locations: | |||||||
Check cashing segment | 1.6 | % | 1.6 | % | |||
Cash advance segment | 2.6 | 3.1 | |||||
Pawn lending segment | 2.1 | 2.0 | |||||
Combined company-owned locations | 2.4 | 2.8 | |||||
Franchised locations - check cashing segment(a) | 1.5 | 1.5 | |||||
Combined fees as a percentage of checks cashed (a) | 1.7 | % | 1.7 | % |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||
FINANCIAL AND OPERATING DATA (Continued) | ||||||
($ in thousands unless otherwise noted) | ||||||
Three Months Ended | ||||||
March 31, | ||||||
2009 | 2008 | |||||
Average check cashed (not in thousands) - | ||||||
Company-owned locations: | ||||||
Check cashing segment | $ | 461 | $ | 416 | ||
Cash advance segment | 691 | 606 | ||||
Pawn lending segment | 520 | 557 | ||||
Combined company-owned locations | 641 | 575 | ||||
Franchised locations - check cashing segment (a) | 544 | 517 | ||||
Combined average check cashed (a) | $ | 560 | $ | 527 | ||
(a) Non-GAAP presentation. For informational purposes and to provide a greater understanding of the Company’s businesses. Management believes that information provided with this level of detail is meaningful and useful in understanding the activities and business metrics of the Company’s operations. Each non-GAAP financial measure is provided immediately following its most comparable GAAP amount and can be reconciled to its most comparable GAAP amount through the presentation of the financial information above.
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(b) Cash advances written by third-party lenders that were arranged by the Company on behalf of the third-party lenders. | ||||||
(c) Includes (i) cash advances written by the Company, and (ii) cash advances written by third-party lenders that were arranged by the Company on behalf of the third-party lenders.
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(d) Amounts recorded in the Company’s consolidated financial statements. | ||||||
(e) Cash advances issued by a third-party lender utilizing the Company as a processor to process these cash advances under a line of credit offered on certain stored-value and payroll cards issued by such lender. The Company acquires a participation interest in the cash advance receivables generated through this program. Cash advance fees associated with the Company’s card services activities include revenue from the Company’s participation interest in the receivables generated by the third party lender, as well as marketing, processing and other miscellaneous fee income. (Note: the Company did not commence business in the card services distribution channel until the third quarter of 2008).
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||||
CONSOLIDATED CASH ADVANCES OUTSTANDING AND RELATED ALLOWANCE FOR LOSSES | ||||||||
(in thousands) | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
Funded by the Company (a) | ||||||||
Active cash advances and fees receivable | $ | 64,362 | $ | 63,952 | ||||
Cash advances and fees in collection | 15,075 | 21,104 | ||||||
Total funded by the Company (a) | 79,437 | 85,056 | ||||||
Funded by third-party lenders (b) (c) | ||||||||
Active cash advances and fees receivable | 32,117 | 29,469 | ||||||
Cash advances and fees in collection | 10,404 | 9,938 | ||||||
Total funded by third-party lenders (b) (c) | 42,521 | 39,407 | ||||||
Combined gross portfolio (b) (d) | 121,958 | 124,463 | ||||||
Less: Elimination of cash advances owned by third-party lenders | 28,800 | 29,469 | ||||||
Company-owned cash advances and fees receivable, gross | 93,158 | 94,994 | ||||||
Less: Allowance for losses | 17,278 | 20,815 | ||||||
Cash advances and fees receivable, net | $ | 75,880 | $ | 74,179 | ||||
Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
Allowance for company-owned cash advances | ||||||||
Balance at beginning of period | $ | 21,495 | $ | 25,676 | ||||
Cash advance loss provision | 25,387 | 26,974 | ||||||
Charge-offs | (34,926 | ) | (40,822 | ) | ||||
Recoveries | 5,322 | 8,987 | ||||||
Balance at end of period | $ | 17,278 | $ | 20,815 | ||||
Accrual for third-party lender-owned cash advances | ||||||||
Balance at beginning of period | $ | 2,135 | $ | 1,828 | ||||
(Decrease) Increase in loss provision | (613 | ) | 160 | |||||
Balance at end of period | $ | 1,522 | $ | 1,988 | ||||
Combined statistics (d) | ||||||||
Combined cash advance loss provision | $ | 24,774 | $ | 27,134 | ||||
Charge-offs (net of recoveries) | 29,604 | 31,835 | ||||||
Combined cash advance loss provision as a % of combined cash advances written (b) | ||||||||
5.1 | % | 5.5 | % | |||||
Charge-offs (net of recoveries) as a % of combined cash advances written (b) | ||||||||
6.1 | % | 6.5 | % | |||||
Combined allowance for losses and accrued third-party lender losses as a % of combined gross portfolio (b) | ||||||||
15.4 | % | 18.3 | % | |||||
(a) Cash advances written by the Company for its own account in pawn locations, cash advance locations, and through the internet distribution channel.
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(b) Non-GAAP presentation. For informational purposes and to provide a greater understanding of the Company’s businesses. Management believes that information provided with this level of detail is meaningful and useful in understanding the activities and business metrics of the Company’s operations. Each non-GAAP financial measure is provided immediately following its most comparable GAAP amount and can be reconciled to its most comparable GAAP amount through the presentation of the financial information above.
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(c) Cash advances written by third-party lenders that were arranged by the Company on behalf of the third-party lenders, all at the Company’s pawn locations, cash advance locations and through the internet distribution channel.
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(d) Includes (i) cash advances written by the Company, and (ii) cash advances written by third-party lenders that were arranged by the Company on behalf of the third-party lenders, all at the Company’s pawn and cash advance locations and through the Company’s internet distribution channel.
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | |||||||||||||||
INCOME FROM OPERATIONS BY OPERATING SEGMENT | |||||||||||||||
THREE MONTHS ENDED MARCH 31, 2009 AND 2008 | |||||||||||||||
(in thousands) | |||||||||||||||
Pawn Lending (1) | Cash Advance (2) | Check Cashing | Consolidated | ||||||||||||
Three months ended March 31, 2009: | |||||||||||||||
Revenue | |||||||||||||||
Finance and service charges | $ | 52,954 | $ | 5 | $ | - | $ | 52,959 | |||||||
Proceeds from disposition of merchandise | 128,002 | 1,758 | - | 129,760 | |||||||||||
Cash advance fees | 7,578 | 72,730 | - | 80,308 | |||||||||||
Check cashing fees, royalties and other | 1,036 | 3,097 | 932 | 5,065 | |||||||||||
Total revenue | 189,570 | 77,590 | 932 | 268,092 | |||||||||||
Cost of revenue – disposed merchandise | 81,329 | 1,173 | - | 82,502 | |||||||||||
Net revenue | 108,241 | 76,417 | 932 | 185,590 | |||||||||||
Expenses | |||||||||||||||
Operations | 57,596 | 27,600 | 335 | 85,531 | |||||||||||
Cash advance loss provision | 1,222 | 23,552 | - | 24,774 | |||||||||||
Administration | 11,750 | 9,473 | 242 | 21,465 | |||||||||||
Depreciation and amortization | 7,097 | 3,161 | 83 | 10,341 | |||||||||||
Total expenses | 77,665 | 63,786 | 660 | 142,111 | |||||||||||
Income from operations | $ | 30,576 | $ | 12,631 | $ | 272 | $ | 43,479 | |||||||
Three months ended March 31, 2008: | |||||||||||||||
Revenue | |||||||||||||||
Finance and service charges | $ | 43,421 | $ | - | $ | - | $ | 43,421 | |||||||
Proceeds from disposition of merchandise | 116,583 | - | - | 116,583 | |||||||||||
Cash advance fees | 9,285 | 76,175 | - | 85,460 | |||||||||||
Check cashing fees, royalties and other | 1,013 | 3,437 | 1,020 | 5,470 | |||||||||||
Total revenue | 170,302 | 79,612 | 1,020 | 250,934 | |||||||||||
Cost of revenue – disposed merchandise | 71,516 | - | - | 71,516 | |||||||||||
Net revenue | 98,786 | 79,612 | 1,020 | 179,418 | |||||||||||
Expenses | |||||||||||||||
Operations | 53,911 | 26,431 | 383 | 80,725 | |||||||||||
Cash advance loss provision | 2,265 | 24,869 | - | 27,134 | |||||||||||
Administration | 10,672 | 7,071 | 213 | 17,956 | |||||||||||
Depreciation and amortization | 5,591 | 3,476 | 64 | 9,131 | |||||||||||
Total expenses | 72,439 | 61,847 | 660 | 134,946 | |||||||||||
Income from operations | $ | 26,347 | $ | 17,765 | $ | 360 | $ | 44,472 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||||||
INCOME FROM OPERATIONS BY OPERATING SEGMENT | ||||||||||
THREE MONTHS ENDED MARCH 31, 2009 AND 2008 | ||||||||||
(in thousands) | ||||||||||
(1) | The Pawn Lending segment is comprised of the Company’s domestic pawn lending operations and its foreign pawn lending operations in Mexico operating under the Prenda Facil tradename. The following table summarizes the results from each channel’s contributions to the Pawn Lending segment for the three months ended March 31, 2009 and 2008: | |||||||||
Domestic | Foreign | Total Pawn Lending | ||||||||
Three months ended March 31, 2009: | ||||||||||
Revenue | ||||||||||
Finance and service charges | $ | 46,491 | $ | 6,463 | $ | 52,954 | ||||
Proceeds from disposition of merchandise | 128,002 | - | 128,002 | |||||||
Cash advance fees | 7,578 | - | 7,578 | |||||||
Check cashing fees, royalties and other | 967 | 69 | 1,036 | |||||||
Total revenue | 183,038 | 6,532 | 189,570 | |||||||
Cost of revenue – disposed merchandise | 81,329 | - | 81,329 | |||||||
Net revenue | 101,709 | 6,532 | 108,241 | |||||||
Expenses | ||||||||||
Operations | 55,185 | 2,411 | 57,596 | |||||||
Cash advance loss provision | 1,222 | - | 1,222 | |||||||
Administration | 10,270 | 1,480 | 11,750 | |||||||
Depreciation and amortization | 6,269 | 828 | 7,097 | |||||||
Total expenses | 72,946 | 4,719 | 77,665 | |||||||
Income from operations | $ | 28,763 | $ | 1,813 | $ | 30,576 | ||||
Three months ended March 31, 2008: | ||||||||||
Revenue | ||||||||||
Finance and service charges | $ | 43,421 | $ | - | $ | 43,421 | ||||
Proceeds from disposition of merchandise | 116,583 | - | 116,583 | |||||||
Cash advance fees | 9,285 | - | 9,285 | |||||||
Check cashing fees, royalties and other | 1,013 | - | 1,013 | |||||||
Total revenue | 170,302 | - | 170,302 | |||||||
Cost of revenue – disposed merchandise | 71,516 | - | 71,516 | |||||||
Net revenue | 98,786 | - | 98,786 | |||||||
Expenses | ||||||||||
Operations | 53,911 | - | 53,911 | |||||||
Cash advance loss provision | 2,265 | - | 2,265 | |||||||
Administration | 10,672 | - | 10,672 | |||||||
Depreciation and amortization | 5,591 | - | 5,591 | |||||||
Total expenses | 72,439 | - | 72,439 | |||||||
Income from operations | $ | 26,347 | $ | - | $ | 26,347 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||||||||||||||
INCOME FROM OPERATIONS BY OPERATING SEGMENT | ||||||||||||||||||
THREE MONTHS ENDED MARCH 31, 2009 AND 2008 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||
(2) | The Cash Advance segment is comprised of three distribution channels - a multi-unit “storefront” platform, an online, internet based lending platform, and a card services business. The following table summarizes the results from each channel’s contributions to the Cash Advance segment for the three months ended March 31, 2009 and 2008: | |||||||||||||||||
Storefront | Internet Lending | Card Services | Total Cash Advance | |||||||||||||||
Three months ended March 31, 2009: | ||||||||||||||||||
Revenue | ||||||||||||||||||
Finance and service charges | $ | 5 | $ | - | $ | - | $ | 5 | ||||||||||
Proceeds from disposition of merchandise | 1,758 | - | - | 1,758 | ||||||||||||||
Cash advance fees | 19,134 | 51,756 | 1,840 | 72,730 | ||||||||||||||
Check cashing fees, royalties and other | 2,887 | 208 | 2 | 3,097 | ||||||||||||||
Total revenue | 23,784 | 51,964 | 1,842 | 77,590 | ||||||||||||||
Cost of revenue – disposed merchandise | 1,173 | - | - | 1,173 | ||||||||||||||
Net revenue | 22,611 | 51,964 | 1,842 | 76,417 | ||||||||||||||
Expenses | ||||||||||||||||||
Operations | 15,368 | 11,301 | 931 | 27,600 | ||||||||||||||
Cash advance loss provision | 2,662 | 20,152 | 738 | 23,552 | ||||||||||||||
Administration | 2,119 | 7,257 | 97 | 9,473 | ||||||||||||||
Depreciation and amortization | 1,435 | 1,610 | 116 | 3,161 | ||||||||||||||
Total expenses | 21,584 | 40,320 | 1,882 | 63,786 | ||||||||||||||
Income from operations | $ | 1,027 | $ | 11,644 | $ | (40 | ) | $ | 12,631 | |||||||||
Three months ended March 31, 2008: | ||||||||||||||||||
Revenue | ||||||||||||||||||
Cash advance fees | $ | 28,693 | $ | 47,482 | $ | - | $ | 76,175 | ||||||||||
Check cashing fees, royalties and other | 3,437 | - | - | 3,437 | ||||||||||||||
Total revenue | 32,130 | 47,482 | - | 79,612 | ||||||||||||||
Expenses | ||||||||||||||||||
Operations | 16,881 | 9,550 | - | 26,431 | ||||||||||||||
Cash advance loss provision | 4,346 | 20,523 | - | 24,869 | ||||||||||||||
Administration | 2,402 | 4,669 | - | 7,071 | ||||||||||||||
Depreciation and amortization | 2,425 | 1,051 | - | 3,476 | ||||||||||||||
Total expenses | 26,054 | 35,793 | - | 61,847 | ||||||||||||||
Income from operations | $ | 6,076 | $ | 11,689 | $ | - | $ | 17,765 |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | |||||||||||||||||||||
INVENTORY AND GROSS PROFIT OPERATING DATA | |||||||||||||||||||||
THREE MONTHS ENDED MARCH 31, 2009 AND 2008 | |||||||||||||||||||||
The table below summarizes the age of merchandise held for disposition before valuation allowance at March 31, 2009 and 2008, respectively (dollars in thousands). | |||||||||||||||||||||
2009 | 2008 | ||||||||||||||||||||
Amount | % | Amount | % | ||||||||||||||||||
Merchandise held for 1 year or less – | |||||||||||||||||||||
Jewelry | $ | 67,684 | 67.5 | % | $ | 61,076 | 64.2 | % | |||||||||||||
Other merchandise | 24,477 | 24.4 | 25,085 | 26.4 | |||||||||||||||||
92,161 | 91.9 | 86,161 | 90.6 | ||||||||||||||||||
Merchandise held for more than 1 year – | |||||||||||||||||||||
Jewelry | 5,192 | 5.2 | 5,500 | 5.8 | |||||||||||||||||
Other merchandise | 2,863 | 2.9 | 3,415 | 3.6 | |||||||||||||||||
8,055 | 8.1 | 8,915 | 9.4 | ||||||||||||||||||
Total merchandise held for disposition | $ | 100,216 | 100.0 | % | $ | 95,076 | 100.0 | % |
Non-GAAP Disclosure
In addition to the financial information prepared in conformity with accounting principles generally accepted in the United States (“GAAP”), the Company provides historical non GAAP financial information. Each non-GAAP financial measure included in the Company’s consolidated financial statements has been indicated by footnote. Each non-GAAP financial measure is provided immediately following its most comparable GAAP amount.
Management uses the non-GAAP financial measures for internal managerial purposes and believes that presentation of non-GAAP financial information is meaningful and useful in understanding the activities and business metrics of the Company’s operations. Management believes that these non-GAAP financial measures reflect an additional way of viewing aspects of our business that, when viewed with our GAAP results, provide a more complete understanding of factors and trends affecting our business.
Management provides non-GAAP financial information for informational purposes and to enhance understanding of the Company’s GAAP consolidated financial statements. Readers should consider the information in addition to, but not instead of, the Company’s financial statements prepared in accordance with GAAP. This non-GAAP financial information may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes.
CONTACT:
Cash America International, Inc.
Thomas A. Bessant, Jr., 817-335-1100