Exhibit 99.1
Cash America Announces Third Quarter Results and Dividend Declared
FORT WORTH, Texas--(BUSINESS WIRE)--October 24, 2013--Cash America International, Inc. (NYSE: CSH) announced today that reported net income attributable to the Company for the third quarter ended September 30, 2013 was $46,186,000 ($1.52 per share) compared to the third quarter of 2012 net income of $11,703,000 (37 cents per share). Both the current period third quarter financial results and the prior year third quarter financial results include significant unusual items. In the third quarter of 2013, the Company recognized a tax benefit of $33.2 million ($1.09 per share) related to the reorganization of its Mexico-based pawn operations, which was completed in the first quarter of 2013. In addition, the Company incurred an $18 million pre-tax expense (37 cents per share after taxes) associated with a negotiated settlement of a class-action lawsuit. These two items combined to create a net benefit to after tax income of $21.9 million (72 cents per share) for the period ended September 30, 2013. The third quarter of 2012 included unusual items of $18.5 million in after-tax costs (59 cents per share) associated with the Company’s reorganization of its Mexico-based pawn operations and $1.9 million after taxes (6 cents per share) related to the write-off of deferred costs and transition expenses associated with the withdrawal of the proposed initial public offering of its wholly-owned subsidiary, Enova International, Inc., during that period. These two items combined to create a total expense after taxes of $20.4 million (65 cents per share) for the period ended September 30, 2012.
Excluding the impact of the 2013 unusual items mentioned above, third quarter 2013 adjusted earnings, a non-GAAP measure, would have been $24.3 million (80 cents per share), which is in line with management’s publicly released earnings per share guidance of between 75 cents per share and 85 cents per share as reported in the Company’s press release dated July 25, 2013. Excluding the impact of the 2012 unusual expenses mentioned above, third quarter 2012 adjusted earnings, a non-GAAP measure, would have been $32.1 million ($1.02 per share).
Consolidated total revenue during the third quarter of 2013 was $437.8 million compared to $439.7 million during the same period in 2012. The Company’s E-Commerce segment reported a 14% increase in total revenue, which reached $198.4 million for the three months ended September 30, 2013. Commenting on the results for the third quarter, Daniel R. Feehan, President and Chief Executive Officer said, “The growth in our consumer loan products during the third quarter provided revenue growth to our E-Commerce business to compensate for the challenges in our retail services business, which continued to experience soft growth in pawn loans and lower levels of profit from the disposition of merchandise.”
For the nine-month period ended September 30, 2013, the Company reported net income of $115,244,000 ($3.73 per share) compared to $82,990,000 ($2.62 per share) for the same period in 2012. Excluding the unusual items discussed above, adjusted net earnings, a non-GAAP measure, would have been $93.4 million ($3.02 per share) for the nine-month period ended September 30, 2013. This compares to adjusted net earnings, a non-GAAP measure, of $103.9 million ($3.28 per share) for the nine-month period ended September 30, 2012, when adding back the unusual items discussed above for the 2012 period. Total revenue was $1.3 billion for both the nine-month periods ended September 30, 2013 and 2012.
Cash America will host a conference call to discuss the third quarter results on Thursday, October 24, at 7:00 AM CDT. A live webcast of the call will be available on the Investor Relations section of the Company’s corporate website (http://www.cashamerica.com). To listen to the live call, please go to the website at least fifteen minutes early to register, download, and install any necessary audio software. A replay will be available on the Company’s website following the 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 stock outstanding. The dividend will be paid at the close of business on November 20, 2013 to shareholders of record on November 6, 2013.
Outlook for the Fourth Quarter of 2013 and 2014 Fiscal Year
Management believes that the opportunities for growth in revenue and earnings will be largely associated with customer demand for the credit products provided by the Company, which take the form of pawn loans and consumer loans and the disposition of unredeemed collateral by way of consumer spending on retail sales and the commercial sale of refined gold and diamonds. The fourth quarter, during the seasonally important holiday selling season, represents an important period of retail sales for the Company, and results will be affected by consumer sentiments during the period. There are various other elements that could affect the growth in revenue, such as the regulation of consumer loan products, the development and growth of additional markets for the Company’s e-commerce segment for consumer lending products, and the development and growth of the Company’s Mexico-based pawn operations. As the Company enters the fourth quarter of 2013, management anticipates that demand for the Company’s consumer loan products will continue on a similar pace to the one it has experienced during the first nine months of 2013, with a continued heavier weighting to the consumer loan portfolio and longer term installment and line of credit products. Demand for the Company’s pawn lending products continued to prove challenging in the second and third quarters of 2013, and management expects growth in the Company’s pawn lending business, but its expectations for the balance of 2013 and into 2014 remain below historical growth rates in the pawn lending business.
Based on management’s views and on the preceding factors, management expects the fourth quarter 2013 net income per share to be between 95 cents and $1.05 per share compared to $1.29 per share in the fourth quarter of 2012, which does not include the unusual costs and other charges incurred in the fourth quarter of 2012 associated with the Company’s reorganization of its Mexico-based pawn operations of $7.0 million after taxes (23 cents per share) and the after-tax impact of the Company’s voluntary refund to certain Ohio customers of $8.4 million (27 cents per share) in the period. The combined amount of the Mexico charges and the refund expense amounted to $15.4 million after taxes (50 cents per share) in the fourth quarter of 2012.
Based on the Company’s results through the first nine months of 2013, management expects its fiscal year 2013 earnings per share to be in a range of between $4.68 and $4.78 per share ($3.96 and $4.06 per share on a non-GAAP adjusted basis, adjusted for the third quarter unusual items discussed above of 72 cents per share) compared to $3.42 per share ($4.57 per share on a non-GAAP adjusted basis when adding back the unusual items for the full year in 2012 of 81 cents per share related to Mexico reorganization charges, 27 cents per share related to the Ohio refund expense and 7 cents per share related to expenses associated with the withdrawal of the proposed initial public offering of Enova International, Inc.) for the twelve-month period of 2012.
In addition, management is initiating its expectations for fiscal year 2014. Based on its current views of the coming year, management establishes its initial anticipated range of earnings per share of between $4.20 to $4.40 for fiscal 2014.
About the Company
As of September 30, 2013, Cash America International, Inc. operated 995 total locations offering specialty financial services to consumers, which included the following:
- 860 lending locations in 22 states in the United States primarily under the names “Cash America Pawn,” “SuperPawn,” “Cash America Payday Advance,” and “Cashland;”
- 47 pawn lending locations in central and southern Mexico under the name “Cash America casa de empeño;” and
- 88 check cashing centers (all of which are unconsolidated franchised check cashing centers) operating in 13 states in the United States under the name “Mr. Payroll.”
Additionally, as of September 30, 2013, the Company offered consumer loans over the Internet to customers:
- in 32 states in the United States at http://www.cashnetusa.com and http://www.netcredit.com;
- in the United Kingdom at http://www.quickquid.co.uk, and http://www.poundstopocket.co.uk;
- in Australia at http://www.dollarsdirect.com.au; and
- in Canada at http://www.dollarsdirect.ca.
For additional information regarding the Company and the services it provides, visit the Company’s websites located at:
http://www.cashamerica.com | | http://www.poundstopocket.co.uk |
http://www.enova.com | | http://www.dollarsdirect.com.au |
http://www.cashnetusa.com | | http://www.dollarsdirect.ca |
http://www.netcredit.com | | http://www.goldpromise.com |
http://www.cashlandloans.com | | http://www.mrpayroll.com |
http://www.quickquid.co.uk | | |
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This release contains forward-looking statements about the business, financial condition, operations and prospects of 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: the effect of or changes in domestic and foreign pawn, consumer credit, tax and other laws and governmental rules and regulations applicable to the Company's business or changes in the interpretation or enforcement thereof; the regulatory and examination authority of the Consumer Financial Protection Bureau in the U.S. and the Financial Conduct Authority in the UK; public perception of the Company’s business, including its consumer loan business and its business practices; changes in the political, regulatory or economic environment in foreign countries where the Company operates or in the future may operate; fluctuations, including a sustained decrease, in the price of gold or deterioration in economic conditions; the effect of any current or future litigation proceedings or any judicial decisions or rule-making that affect the Company, its products or its arbitration agreements; the actions of third parties who provide, acquire or offer products and services to, from or for the Company; changes in demand for the Company’s services, the Company’s ability to attract and retain qualified executive officers; a prolonged interruption in the Company’s operations of its facilities, systems and business functions, including its information technology and other business systems; the ability of the Company to open new locations in accordance with its plans or to successfully integrate newly acquired businesses into the Company’s operations; changes in competition; interest rate and foreign currency exchange rate fluctuations; changes in the capital markets; changes in the Company’s ability to satisfy its debt obligations or to refinance existing debt obligations or obtain new capital to finance growth; security breaches, cyber attacks or fraudulent activity; compliance with laws and regulations applicable to international operations; the implementation of new, or changes in the interpretation of existing, accounting principles or financial reporting requirements; acts of God, war or terrorism, pandemics and other events; the effect of any of such changes on the Company’s business or the markets in which it operates; and other risks and uncertainties 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, in many cases, 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,” “would,” “plans,” “expects,” “anticipates,” “may,” “forecasts,” “projects” and similar expressions and 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.
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| CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
| HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS |
| (dollars in thousands, except per share data) |
| (Unaudited) |
| | Three Months Ended | | Nine Months Ended |
| | September 30, | | September 30, |
| | 2013 | | 2012 | | 2013 | | 2012 |
| |
| Consolidated Operations: | | | | | | | | | | | | |
| Total revenue | | $ | 437,801 | | $ | 439,694 | | $ | 1,316,880 | | | $ | 1,308,826 |
| Net revenue | | | 247,007 | | | 248,477 | | | 763,709 | | | | 738,869 |
| Total expenses | | | 218,488 | | | 208,289 | | | 608,356 | | | | 572,442 |
| |
| Income from Operations | | $ | 28,519 | | $ | 40,188 | | $ | 155,353 | | | $ | 166,427 |
| |
| Income before income taxes | | | 18,173 | | | 33,046 | | | 128,279 | | | | 145,160 |
| |
| Net Income | | $ | 46,186 | | $ | 7,930 | | $ | 115,552 | | | $ | 77,673 |
| |
| Net (income) loss attributable to the noncontrolling interest | | | - | | | 3,773 | | | (308 | ) | | | 5,317 |
| |
| Net Income Attributable to Cash America International, Inc. | | $ | 46,186 | | $ | 11,703 | | $ | 115,244 | | | $ | 82,990 |
| |
| Earnings per share: | | | | | | | | | | | | |
| Net Income attributable to Cash America International, Inc. common shareholders: |
| Basic | | $ | 1.62 | | $ | 0.40 | | $ | 4.01 | | | $ | 2.80 |
| Diluted | | $ | 1.52 | | $ | 0.37 | | $ | 3.73 | | | $ | 2.62 |
| |
| Weighted average common shares outstanding: | | | | | | | | | | | | |
| Basic | | | 28,426 | | | 29,536 | | | 28,747 | | | | 29,599 |
| Diluted | | | 30,379 | | | 31,375 | | | 30,857 | | | | 31,643 |
| | | | | | | | | | | | |
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| CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS |
| (dollars in thousands, except per share data) |
| (Unaudited) |
| | September 30, | | December 31, |
| | 2013 | | 2012 | | 2012 |
| | | | | | | | | |
| Assets | | | | | | | | | |
| Current assets: | | | | | | | | | |
| Cash and cash equivalents | | $ | 84,096 | | | $ | 78,663 | | | $ | 63,134 | |
| Pawn loans | | | 253,678 | | | | 254,077 | | | | 244,640 | |
| Consumer loans, net | | | 328,281 | | | | 256,825 | | | | 289,418 | |
| Merchandise held for disposition, net | | | 193,115 | | | | 171,285 | | | | 167,409 | |
| Pawn loan fees and service charges receivable | | | 50,090 | | | | 48,771 | | | | 48,991 | |
| Income taxes receivable | | | 10,931 | | | | 684 | | | | - | |
| Prepaid expenses and other assets | | | 28,840 | | | | 36,912 | | | | 35,605 | |
| Deferred tax assets | | | 46,429 | | | | 39,826 | | | | 48,992 | |
| Total current assets | | | 995,460 | | | | 887,043 | | | | 898,189 | |
| Property and equipment, net | | | 257,787 | | | | 258,214 | | | | 261,771 | |
| Goodwill | | | 670,037 | | | | 599,337 | | | | 608,216 | |
| Intangible assets, net | | | 46,860 | | | | 34,877 | | | | 36,473 | |
| Other assets | | | 21,185 | | | | 12,936 | | | | 13,609 | |
| Total assets | | $ | 1,991,329 | | | $ | 1,792,407 | | | $ | 1,818,258 | |
| | | | | | | | | |
| Liabilities and Equity | | | | | | | | | |
| Current liabilities: | | | | | | | | | |
| Accounts payable and accrued expenses | | $ | 137,473 | | | $ | 109,986 | | | $ | 126,664 | |
| Customer deposits | | | 15,123 | | | | 12,944 | | | | 11,420 | |
| Income taxes currently payable | | | - | | | | - | | | | 5,922 | |
| Current portion of long-term debt | | | 22,606 | | | | 44,205 | | | | 43,617 | |
| Total current liabilities | | | 175,202 | | | | 167,135 | | | | 187,623 | |
| Deferred tax liabilities | | | 96,286 | | | | 102,048 | | | | 101,711 | |
| Noncurrent income tax payable | | | - | | | | 2,697 | | | | 2,703 | |
| Other liabilities | | | 1,287 | | | | 1,007 | | | | 888 | |
| Long-term debt | | | 660,243 | | | | 545,258 | | | | 534,713 | |
| Total liabilities | | $ | 933,018 | | | $ | 818,145 | | | $ | 827,638 | |
| | | | | | | | | |
| Equity: | | | | | | | | | |
| Cash America International, Inc. equity: | | | | | | | | | |
Common stock, $0.10 par value per share, 80,000,000 shares authorized, 30,235,164 shares issued and outstanding | | | 3,024 | | | | 3,024 | | | | 3,024 | |
| Additional paid-in capital | | | 152,872 | | | | 157,874 | | | | 157,613 | |
| Retained earnings | | | 991,682 | | | | 855,972 | | | | 879,434 | |
| Accumulated other comprehensive income | | | 2,614 | | | | 4,366 | | | | 3,128 | |
Treasury shares, at cost (2,164,873 shares, 1,214,646 shares and 1,351,712 shares as of September 30, 2013 and 2012, and as of December 31, 2012, respectively) | | | (91,881 | ) | | | (46,175 | ) | | | (51,304 | ) |
| Total Cash America International, Inc. shareholders' equity | | | 1,058,311 | | | | 975,061 | | | | 991,895 | |
| Noncontrolling interest | | | - | | | | (799 | ) | | | (1,275 | ) |
| Total equity | | | 1,058,311 | | | | 974,262 | | | | 990,620 | |
| Total liabilities and equity | | $ | 1,991,329 | | | $ | 1,792,407 | | | $ | 1,818,258 | |
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (dollars in thousands, except per share data) (Unaudited) |
| | | | |
| | Three Months Ended | | Nine Months Ended |
| | September 30, | | September 30, |
| | 2013 | | 2012 | | 2013 | | 2012 |
| | | | | | | | | | | | |
| Revenue | | | | | | | | | | | | |
| Pawn loan fees and service charges | | $ | 79,298 | | | $ | 76,500 | | | $ | 227,940 | | | $ | 221,450 | |
| Proceeds from disposition of merchandise | | | 128,660 | | | | 153,493 | | | | 438,909 | | | | 517,832 | |
| Consumer loan fees | | | 227,563 | | | | 205,094 | | | | 640,199 | | | | 558,656 | |
| Other | | | 2,280 | | | | 4,607 | | | | 9,832 | | | | 10,888 | |
| Total Revenue | | | 437,801 | | | | 439,694 | | | | 1,316,880 | | | | 1,308,826 | |
| Cost of Revenue | | | | | | | | | | | | |
| Disposed merchandise | | | 91,101 | | | | 106,918 | | | | 301,397 | | | | 350,878 | |
| Consumer loan loss provision | | | 99,693 | | | | 84,299 | | | | 251,774 | | | | 219,079 | |
| Total Cost of Revenue | | | 190,794 | | | | 191,217 | | | | 553,171 | | | | 569,957 | |
| | | | | | | | | | | | |
| Net Revenue | | | 247,007 | | | | 248,477 | | | | 763,709 | | | | 738,869 | |
| Expenses | | | | | | | | | | | | |
| Operations and administration | | | 199,705 | | | | 181,215 | | | | 554,042 | | | | 515,560 | |
| Depreciation and amortization | | | 18,783 | | | | 27,074 | | | | 54,314 | | | | 56,882 | |
| Total Expenses | | | 218,488 | | | | 208,289 | | | | 608,356 | | | | 572,442 | |
| Income from Operations | | | 28,519 | | | | 40,188 | | | | 155,353 | | | | 166,427 | |
| Interest expense | | | (9,260 | ) | | | (7,196 | ) | | | (25,608 | ) | | | (21,065 | ) |
| Interest income | | | 1 | | | | 22 | | | | 69 | | | | 79 | |
| Foreign currency transaction (loss) gain | | | (741 | ) | | | 93 | | | | (1,053 | ) | | | (72 | ) |
| Loss on extinguishment of debt | | | (346 | ) | | | - | | | | (346 | ) | | | - | |
| Equity in loss of unconsolidated subsidiary | | | - | | | | (61 | ) | | | (136 | ) | | | (209 | ) |
| Income before Income Taxes | | | 18,173 | | | | 33,046 | | | | 128,279 | | | | 145,160 | |
| (Benefit) provision for income taxes | | | (28,013 | ) | | | 25,116 | | | | 12,727 | | | | 67,487 | |
| Net Income | | | 46,186 | | | | 7,930 | | | | 115,552 | | | | 77,673 | |
| Net loss (income) attributable to the noncontrolling interest | | | - | | | | 3,773 | | | | (308 | ) | | | 5,317 | |
| Net Income Attributable to Cash America International, Inc. | | $ | 46,186 | | | $ | 11,703 | | | $ | 115,244 | | | $ | 82,990 | |
| Earnings Per Share: | | | | | | | | | | | | |
| Net Income attributable to Cash America International, Inc. common shareholders: | | | | | | | | | | | | |
| Basic | | $ | 1.62 | | | $ | 0.40 | | | $ | 4.01 | | | $ | 2.80 | |
| Diluted | | $ | 1.52 | | | $ | 0.37 | | | $ | 3.73 | | | $ | 2.62 | |
| Weighted average common shares outstanding: | | | | | | | | | | | | |
| Basic | | | 28,426 | | | | 29,536 | | | | 28,747 | | | | 29,599 | |
| Diluted | | | 30,379 | | | | 31,375 | | | | 30,857 | | | | 31,643 | |
| Dividends declared per common share | | $ | 0.035 | | | $ | 0.035 | | | $ | 0.105 | | | $ | 0.105 | |
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES PAWN LENDING ACTIVITIES – FINANCIAL AND OPERATING DATA |
| | |
The following tables outline certain data related to the pawn loan activities of Cash America International, Inc. and its subsidiaries (the “Company”) as of and for the three and nine months ended September 30, 2013 and 2012 (dollars in thousands). |
| | |
| | As of September 30, |
| | 2013 | | 2012 | | Change | | % Change |
| Ending pawn loan balances | | | | | | | | | | | | |
| Domestic retail services | | $ | 248,427 | | | $ | 241,261 | | | $ | 7,166 | | | 3.0 | | % |
| Foreign retail services | | | 5,251 | | | | 12,816 | | | | (7,565 | ) | | (59.0 | ) | % |
| Consolidated pawn loan balances | | $ | 253,678 | | | $ | 254,077 | | | $ | (399 | ) | | (0.2 | ) | % |
| | | | | | | | | | | | |
| Ending merchandise balance, net | | | | | | | | | | | | |
| Domestic retail services | | $ | 186,878 | | | $ | 160,075 | | | $ | 26,803 | | | 16.7 | | % |
| Foreign retail services | | | 6,237 | | | | 11,210 | | | | (4,973 | ) | | (44.4 | ) | % |
| Consolidated merchandise balance, net | | $ | 193,115 | | | $ | 171,285 | | | $ | 21,830 | | | 12.7 | | % |
| |
| | Three Months Ended September 30, |
| | 2013 | | 2012 | | Change | | % Change |
| Pawn loan fees and service charges | | | | | | | | | | | | |
| Domestic retail services | | $ | 77,532 | | | $ | 73,209 | | | $ | 4,323 | | | 5.9 | | % |
| Foreign retail services | | | 1,766 | | | | 3,291 | | | | (1,525 | ) | | (46.3 | ) | % |
| Consolidated pawn loan fees and service charges | | $ | 79,298 | | | $ | 76,500 | | | $ | 2,798 | | | 3.7 | | % |
| | | | | | | | | | | | |
| Average pawn loan balance outstanding | | | | | | | | | | | | |
| Domestic retail services | | $ | 241,785 | | | $ | 232,027 | | | $ | 9,758 | | | 4.2 | | % |
| Foreign retail services | | | 5,012 | | | | 11,870 | | | | (6,858 | ) | | (57.8 | ) | % |
| Consolidated average pawn loans outstanding | | $ | 246,797 | | | $ | 243,897 | | | $ | 2,900 | | | 1.2 | | % |
| | | | | | | | | | | | |
| Amount of pawn loans written and renewed | | | | | | | | | | | | |
| Domestic retail services | | $ | 258,055 | | | $ | 238,191 | | | $ | 19,864 | | | 8.3 | | % |
| Foreign retail services | | | 14,043 | | | | 35,240 | | | | (21,197 | ) | | (60.2 | ) | % |
| Consolidated amount of pawn loans written and renewed | | $ | 272,098 | | | $ | 273,431 | | | $ | (1,333 | ) | | (0.5 | ) | % |
| | | | | | | | | | | | |
| Average amount per pawn loan (in ones) | | | | | | | | | | | | |
| Domestic retail services | | $ | 125 | | | $ | 131 | | | $ | (6 | ) | | (4.6 | ) | % |
| Foreign retail services | | $ | 86 | | | $ | 84 | | | $ | 2 | | | 2.4 | | % |
| Consolidated average amount per pawn loan (in ones) | | $ | 122 | | | $ | 122 | | | $ | - | | | - | | % |
| | | | | | | | | | | | |
| Annualized yield on pawn loans | | | | | | | | | | | | |
| Domestic retail services | | | 127.2 | % | | | 125.5 | % | | | | | | |
| Foreign retail services | | | 139.8 | % | | | 110.3 | % | | | | | | |
| Consolidated annualized yield on pawn loans | | | 127.5 | % | | | 124.8 | % | | | | | | |
| | | | | | | | | | | | |
| Gross profit margin on disposition of merchandise | | | | | | | | | | | | |
| Domestic retail services | | | 29.6 | % | | | 31.7 | % | | | | | | |
| Foreign retail services | | | 17.1 | % | | | 14.5 | % | | | | | | |
| Gross profit margin on disposition of merchandise | | | 29.2 | % | | | 30.3 | % | | | | | | |
| | | | | | | | | | | | |
| Merchandise turnover | | | | | | | | | | | | |
| Domestic retail services | | | 2.1 | | | | 2.6 | | | | | | | |
| Foreign retail services | | | 2.3 | | | | 3.7 | | | | | | | |
| Consolidated merchandise turnover | | | 2.1 | | | | 2.7 | | | | | | | |
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES PAWN LENDING ACTIVITIES – FINANCIAL AND OPERATING DATA |
| | | | | | | | | | | | |
| | Nine Months Ended September 30, |
| | 2013 | | 2012 | | Change | | % Change |
| Pawn loan fees and service charges | | | | | | | | | | | | |
| Domestic retail services | | $ | 222,508 | | | $ | 210,807 | | | $ | 11,701 | | | 5.6 | | % |
| Foreign retail services | | | 5,432 | | | | 10,643 | | | | (5,211 | ) | | (49.0 | ) | % |
| Consolidated pawn loan fees and service charges | | $ | 227,940 | | | $ | 221,450 | | | $ | 6,490 | | | 2.9 | | % |
| | | | | | | | | | | | |
| Average pawn loan balance outstanding | | | | | | | | | | | | |
| Domestic retail services | | $ | 228,048 | | | $ | 220,494 | | | $ | 7,554 | | | 3.4 | | % |
| Foreign retail services | | | 4,910 | | | | 13,843 | | | | (8,933 | ) | | (64.5 | ) | % |
| Consolidated average pawn loans outstanding | | $ | 232,958 | | | $ | 234,337 | | | $ | (1,379 | ) | | (0.6 | ) | % |
| | | | | | | | | | | | |
| Amount of pawn loans written and renewed | | | | | | | | | | | | |
| Domestic retail services | | $ | 707,758 | | | $ | 675,000 | | | $ | 32,758 | | | 4.9 | | % |
| Foreign retail services | | | 42,303 | | | | 104,877 | | | | (62,574 | ) | | (59.7 | ) | % |
| Consolidated amount of pawn loans written and renewed | | $ | 750,061 | | | $ | 779,877 | | | $ | (29,816 | ) | | (3.8 | ) | % |
| | | | | | | | | | | | |
| Average amount per pawn loan (in ones) | | | | | | | | | | | | |
| Domestic retail services | | $ | 127 | | | $ | 130 | | | $ | (3 | ) | | (2.3 | ) | % |
| Foreign retail services | | $ | 87 | | | $ | 89 | | | $ | (2 | ) | | (2.2 | ) | % |
| Consolidated average amount per pawn loan (in ones) | | $ | 124 | | | $ | 122 | | | $ | 2 | | | 1.6 | | % |
| | | | | | | | | | | | |
| Annualized yield on pawn loans | | | | | | | | | | | | |
| Domestic retail services | | | 130.5 | % | | | 127.7 | % | | | | | | |
| Foreign retail services | | | 147.9 | % | | | 102.7 | % | | | | | | |
| Consolidated annualized yield on pawn loans | | | 130.8 | % | | | 126.2 | % | | | | | | |
| | | | | | | | | | | | |
| Gross profit margin on disposition of merchandise | | | | | | | | | | | | |
| Domestic retail services | | | 31.7 | % | | | 33.8 | % | | | | | | |
| Foreign retail services | | | 17.9 | % | | | 11.5 | % | | | | | | |
| Gross profit margin on disposition of merchandise | | | 31.3 | % | | | 32.2 | % | | | | | | |
| | | | | | | | | | | | |
| Merchandise turnover | | | | | | | | | | | | |
| Domestic retail services | | | 2.5 | | | | 3.0 | | | | | | | |
| Foreign retail services | | | 2.5 | | | | 3.8 | | | | | | | |
| Consolidated merchandise turnover | | | 2.5 | | | | 3.0 | | | | | | | |
| | | | | | | | | | | | |
| | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES MERCHANDISE DISPOSITION, GROSS PROFIT AND OPERATING DATA |
| | |
Profit from the disposition of merchandise represents the proceeds received from the disposition of merchandise in excess of the cost of disposed merchandise, which is the Company's cost basis in the pawn loan or the amount paid for purchased merchandise. The following tables summarize the proceeds from the disposition of merchandise and the related profit for the three and nine months ended September 30, 2013 and 2012 (dollars in thousands). |
| | |
| | Three Months Ended September 30, |
| | 2013 | | 2012 |
| | Retail | | Commercial | | Total | | Retail | | Commercial | | Total |
| Proceeds from disposition | | $ | 94,169 | | | $ | 34,491 | | | $ | 128,660 | | | $ | 81,947 | | | $ | 71,546 | | | $ | 153,493 | |
| Gross profit on disposition | | $ | 33,452 | | | $ | 4,107 | | | $ | 37,559 | | | $ | 30,023 | | | $ | 16,552 | | | $ | 46,575 | |
| Gross profit margin | | | 35.5 | % | | | 11.9 | % | | | 29.2 | % | | | 36.6 | % | | | 23.1 | % | | | 30.3 | % |
| Percentage of total gross profit | | | 89.1 | % | | | 10.9 | % | | | 100.0 | % | | | 64.5 | % | | | 35.5 | % | | | 100.0 | % |
| | |
| | Nine Months Ended September 30, |
| | 2013 | | 2012 |
| | Retail | | Commercial | | Total | | Retail | | Commercial | | Total |
| Proceeds from disposition | | $ | 296,415 | | | $ | 142,494 | | | $ | 438,909 | | | $ | 277,602 | | | $ | 240,230 | | | $ | 517,832 | |
| Gross profit on disposition | | $ | 108,827 | | | $ | 28,685 | | | $ | 137,512 | | | $ | 103,470 | | | $ | 63,484 | | | $ | 166,954 | |
| Gross profit margin | | | 36.7 | % | | | 20.1 | % | | | 31.3 | % | | | 37.3 | % | | | 26.4 | % | | | 32.2 | % |
| Percentage of total gross profit | | | 79.1 | % | | | 20.9 | % | | | 100.0 | % | | | 62.0 | % | | | 38.0 | % | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | |
The following table summarizes the age of merchandise held for disposition before valuation allowance of $0.9 million and $0.7 million as of September 30, 2013 and 2012, respectively (dollars in thousands). |
| | |
| | As of September 30, |
| | 2013 | | 2012 |
| | Amount | | % | | Amount | | % |
| Jewelry - held for one year or less | | $ | 105,583 | | 54.4 | | $ | 101,464 | | 59.0 |
| Other merchandise - held for one year or less | | | 76,235 | | 39.3 | | | 62,268 | | 36.2 |
| Total merchandise held for one year or less | | | 181,818 | | 93.7 | | | 163,732 | | 95.2 |
| Jewelry - held for more than one year | | | 5,701 | | 2.9 | | | 2,827 | | 1.6 |
| Other merchandise - held for more than one year | | | 6,544 | | 3.4 | | | 5,437 | | 3.2 |
| Total merchandise held for more than one year | | | 12,245 | | 6.3 | | | 8,264 | | 4.8 |
| Total merchandise held for disposition | | $ | 194,063 | | 100.0 | | $ | 171,996 | | 100.0 |
| | | | | | | | | | |
| | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSUMER LOAN FINANCIAL AND OPERATING DATA |
| | |
The following tables set forth consumer loan fees by segment, adjusted for the deduction of the loan loss provision for the three and nine months ended September 30, 2013 and 2012 (dollars in thousands, except where otherwise noted). |
| | |
| | Three Months Ended September 30, |
| | 2013 | | 2012 |
| | Retail
Services | | E-Commerce | | Total | | Retail
Services | | E-Commerce | | Total |
| Interest and fees on short-term loans | | $ | 26,265 | | | | $ | 92,510 | | | $ | 118,775 | | | $ | 28,364 | | | | $ | 117,493 | | | $ | 145,857 | |
| Interest and fees on line of credit accounts | | | - | | | | | 50,504 | | | | 50,504 | | | | - | | | | | 20,077 | | | | 20,077 | |
Interest and fees on installment loans | | | 3,239 | | | | | 55,045 | | | | 58,284 | | | | 3,081 | | | | | 36,079 | | | | 39,160 | |
| Consumer loan fees | | $ | 29,504 | | | | $ | 198,059 | | | $ | 227,563 | | | $ | 31,445 | | | | $ | 173,649 | | | $ | 205,094 | |
| Consumer loan loss provision | | | 10,037 | | | | | 89,656 | | | | 99,693 | | | | 8,061 | | | | | 76,238 | | | | 84,299 | |
| Consumer loan fees, net of loss provision | | $ | 19,467 | | | | $ | 108,403 | | | $ | 127,870 | | | $ | 23,384 | | | | $ | 97,411 | | | $ | 120,795 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Year-over-year change - $ | | $ | (3,917 | ) | | | $ | 10,992 | | | $ | 7,075 | | | $ | (1,780 | ) | | | $ | 20,170 | | | $ | 18,390 | |
| Year-over-year change - % | | | (16.8 | ) | % | | | 11.3 | % | | | 5.9 | % | | | (7.1 | ) | % | | | 26.1 | % | | | 18.0 | % |
Consumer loan loss provision as a % of consumer loan fees | | | 34.0 | | % | | | 45.3 | % | | | 43.8 | % | | | 25.6 | | % | | | 43.9 | % | | | 41.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Nine Months Ended September 30, |
| | 2013 | | 2012 |
| | Retail
Services | | E-Commerce | | Total | | Retail
Services | | E-Commerce | | Total |
| Interest and fees on short-term loans | | $ | 74,999 | | | | $ | 310,549 | | | $ | 385,548 | | | $ | 81,169 | | | | $ | 339,270 | | | $ | 420,439 | |
| Interest and fees on line of credit accounts | | | - | | | | | 102,021 | | | | 102,021 | | | | - | | | | | 45,998 | | | | 45,998 | |
| Interest and fees on installment loans | | | 9,474 | | | | | 143,156 | | | | 152,630 | | | | 8,227 | | | | | 83,992 | | | | 92,219 | |
| Consumer loan fees | | $ | 84,473 | | | | $ | 555,726 | | | $ | 640,199 | | | $ | 89,396 | | | | $ | 469,260 | | | $ | 558,656 | |
| Consumer loan loss provision | | | 23,927 | | | | | 227,847 | | | | 251,774 | | | | 19,130 | | | | | 199,949 | | | | 219,079 | |
| Consumer loan fees, net of loss provision | | $ | 60,546 | | | | $ | 327,879 | | | $ | 388,425 | | | $ | 70,266 | | | | $ | 269,311 | | | $ | 339,577 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Year-over-year change - $ | | $ | (9,720 | ) | | | $ | 58,568 | | | $ | 48,848 | | | $ | (114 | ) | | | $ | 66,374 | | | $ | 66,260 | |
| Year-over-year change - % | | | (13.8 | ) | % | | | 21.7 | % | | | 14.4 | % | | | (0.2 | ) | % | | | 32.7 | % | | | 24.2 | % |
Consumer loan loss provision as a % of consumer loan fees | | | 28.3 | | % | | | 41.0 | % | | | 39.3 | % | | | 21.4 | | % | | | 42.6 | % | | | 39.2 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
In addition to reporting consumer loans owned by the Company and consumer loans guaranteed by the Company, which are either generally accepted accounting principles (“GAAP”) items or disclosures required by GAAP, the Company has provided combined consumer loans, which is a non-GAAP measure. In addition, the Company has reported consumer loans written and renewed, which is statistical data that is not included in the Company’s financial statements. The Company also reports allowances and liabilities for estimated losses on consumer loans individually and on a combined basis, which are GAAP measures that are included in the Company’s financial statements.
Management believes these measures, including ratios calculated using these measures, provide investors with important information needed to evaluate the magnitude of potential loan losses and the opportunity for revenue performance of the consumer loan portfolio on an aggregate basis. Management believes the comparison of the aggregate amounts from period to period is more meaningful than comparing only the residual amount on the Company’s balance sheet since both revenue and the consumer loan loss provision are impacted by the aggregate amount of loans owned by the Company and those guaranteed by the Company as reflected in its financial statements.
| | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSUMER LOAN FINANCIAL AND OPERATING DATA |
| | |
The following tables summarize selected data related to the Company’s consumer loan activities as of and for the three and nine months ended September 30, 2013 and 2012 (dollars in thousands, except where otherwise noted). |
| | |
The following table shows short-term loans and related loan loss activity, which is based on the volume of loans written and renewed, for the three months ended September 30, 2013 and 2012. |
| | |
| | Three Months Ended |
| | September 30, |
| | 2013 | | 2012 |
| Short-term loans: | | | | |
Combined consumer loan loss provision as a % of combined consumer loans written and renewed(a) | | 6.5 | % | | 6.6 | % |
Charge-offs (net of recoveries) as a % of combined consumer loans written and renewed(a) | | 7.6 | % | | 6.7 | % |
Combined consumer loan loss provision as a % of consumer loan fees | | 35.2 | % | | 35.3 | % |
Allowance and liability for losses as a % of combined consumer loans and fees receivable, gross(b) | | 18.8 | % | | 19.0 | % |
| | |
(a) The disclosure regarding the amount of consumer loans written and renewed is statistical data that is not included in the Company's financial statements. |
(b) Non-GAAP measure. |
| |
| | |
The following table shows line of credit accounts and installment loans and related loan loss activity, which is based on the average amount of consumer loan balances, for the three months ended September 30, 2013 and 2012. |
| | |
| | Three Months Ended |
| | September 30, |
| | 2013 | | 2012 |
| Line of credit accounts: | | | | |
Combined consumer loan loss provision as a % of combined average consumer loan balance(a)(b) | | 31.9 | % | | 27.9 | % |
Charge-offs (net of recoveries) as a % of combined average consumer loan balance(a)(b) | | 17.6 | % | | 19.5 | % |
Combined consumer loan loss provision as a % of consumer loan fees | | 49.8 | % | | 48.1 | % |
Allowance and liability for losses as a % of combined average consumer loan balance(a) | | 22.0 | % | | 21.1 | % |
| |
| Installment loans: | | | | |
Combined consumer loan loss provision as a % of combined average consumer loan balance(a)(b) | | 20.8 | % | | 22.7 | % |
Charge-offs (net of recoveries) as a % of combined average consumer loan balance(a)(b) | | 17.0 | % | | 15.5 | % |
Combined consumer loan loss provision as a % of consumer loan fees | | 56.2 | % | | 59.2 | % |
Allowance and liability for losses as a % of combined average consumer loan balance(a) | | 20.3 | % | | 25.1 | % |
(a) Non-GAAP measure. |
(b) The average consumer loan balance is a simple average of the beginning and ending consumer loan balance. |
| | |
| | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSUMER LOAN FINANCIAL AND OPERATING DATA |
| | |
The following table summarizes consumer loan balances outstanding as of September 30, 2013 and 2012 (dollars in thousands): |
| | |
| | As of September 30, |
| | 2013 | | 2012 |
| | Company
Owned(a) | | Guaranteed
by the
Company(a) | | Combined(b) | | Company
Owned(a) | | Guaranteed
by the
Company(a) | | Combined(b) |
| Ending consumer loan balances: | | | | | | | | | | | | | | | | | | |
Retail Services | | | | | | | | | | | | | | | | | | |
| Short-term loans | | $ | 47,824 | | | $ | 4,681 | | | $ | 52,505 | | | $ | 49,079 | | | $ | 6,904 | | | $ | 55,983 | |
| Installment loans | | | 9,945 | | | | 10,275 | | | | 20,220 | | | | 9,899 | | | | 6,707 | | | | 16,606 | |
| Total Retail Services, gross | | | 57,769 | | | | 14,956 | | | | 72,725 | | | | 58,978 | | | | 13,611 | | | | 72,589 | |
E-Commerce | | | | | | | | | | | | | | | | | | |
| Domestic | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 33,926 | | | | 35,107 | | | | 69,033 | | | | 36,832 | | | | 37,952 | | | | 74,784 | |
| Line of credit accounts | | | 59,341 | | | | - | | | | 59,341 | | | | 38,603 | | | | - | | | | 38,603 | |
| Installment loans | | | 62,460 | | | | - | | | | 62,460 | | | | 38,986 | | | | - | | | | 38,986 | |
| Total Domestic, gross | | | 155,727 | | | | 35,107 | | | | 190,834 | | | | 114,421 | | | | 37,952 | | | | 152,373 | |
| |
| Foreign | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 63,276 | | | | 22 | | | | 63,298 | | | | 96,561 | | | | 3,708 | | | | 100,269 | |
| Line of credit accounts | | | 40,265 | | | | - | | | | 40,265 | | | | - | | | | - | | | | - | |
| Installment loans | | | 101,200 | | | | - | | | | 101,200 | | | | 66,111 | | | | - | | | | 66,111 | |
| Total Foreign, gross | | | 204,741 | | | | 22 | | | | 204,763 | | | | 162,672 | | | | 3,708 | | | | 166,380 | |
| Total E-Commerce, gross | | | 360,468 | | | | 35,129 | | | | 395,597 | | | | 277,093 | | | | 41,660 | | | | 318,753 | |
| |
| Total ending loan balance, gross | | | 418,237 | | | | 50,085 | | | | 468,322 | | | | 336,071 | | | | 55,271 | | | | 391,342 | |
| Less: Allowance and liabilities for losses | | | (89,956 | ) | | | (2,830 | ) | | | (92,786 | ) | | | (79,246 | ) | | | (3,437 | ) | | | (82,683 | ) |
| Total ending loan balance, net | | $ | 328,281 | | | $ | 47,255 | | | $ | 375,536 | | | $ | 256,825 | | | $ | 51,834 | | | $ | 308,659 | |
| Allowance and liability for losses as a % of consumer loan balances, gross(c) | | | 21.5 | % | | | 5.7 | % | | | 19.8 | % | | | 23.6 | % | | | 6.2 | % | | | 21.1 | % |
| | |
(a) GAAP measure. The consumer loan balances guaranteed by the Company represent loans originated by third-party lenders through the Company's credit services organization programs (the “CSO programs”), so these balances are not recorded in the Company’s financial statements. However, the Company has established a liability for estimated losses in support of its guarantee of these loans, which is reflected in the table above and included in its financial statements. |
(b) Except for allowance and liability for estimated losses, amounts represent non-GAAP measures. |
(c) Non-GAAP measure. |
| |
| |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSUMER LOAN FINANCIAL AND OPERATING DATA |
| |
The following tables summarize the consumer loans written and renewed for the three and nine months ended September 30, 2013 and 2012 (dollars in thousands, except where otherwise noted). |
| | |
| | Three Months Ended September 30, |
| | 2013 | | 2012 |
| | Company
Owned(a) | | Guaranteed
by the
Company(a)(b) | | Combined(a) | | Company
Owned(a) | | Guaranteed
by the
Company(a)(b) | | Combined(a) |
Amount of consumer loans written and renewed (dollars in thousands): | | | | | | | | | | | | | | | | | | |
Retail Services | | | | | | | | | | | | | | | | | | |
| Short-term loans | | $ | 185,238 | | $ | 28,127 | | $ | 213,365 | | $ | 191,332 | | $ | 36,343 | | $ | 227,675 |
| Installment loans | | | 2,025 | | | 4,885 | | | 6,910 | | | 2,026 | | | 4,457 | | | 6,483 |
| Total Retail Services | | | 187,263 | | | 33,012 | | | 220,275 | | | 193,358 | | | 40,800 | | | 234,158 |
E-Commerce | | | | | | | | | | | | | | | | | | |
| Domestic | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 78,771 | | | 182,698 | | | 261,469 | | | 81,619 | | | 197,962 | | | 279,581 |
| Line of credit accounts | | | 47,088 | | | - | | | 47,088 | | | 35,166 | | | - | | | 35,166 |
Installment loans | | | 48,243 | | | - | | | 48,243 | | | 29,987 | | | - | | | 29,987 |
| Total Domestic | | | 174,102 | | | 182,698 | | | 356,800 | | | 146,772 | | | 197,962 | | | 344,734 |
| |
| Foreign | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 171,828 | | | 601 | | | 172,429 | | | 251,787 | | | 17,676 | | | 269,463 |
| Line of credit accounts | | | 58,746 | | | - | | | 58,746 | | | - | | | - | | | - |
| Installment loans | | | 90,448 | | | - | | | 90,448 | | | 35,380 | | | - | | | 35,380 |
| Total Foreign | | | 321,022 | | | 601 | | | 321,623 | | | 287,167 | | | 17,676 | | | 304,843 |
| Total E-Commerce | | | 495,124 | | | 183,299 | | | 678,423 | | | 433,939 | | | 215,638 | | | 649,577 |
| |
Total amount of consumer loans written and renewed | | $ | 682,387 | | $ | 216,311 | | $ | 898,698 | | $ | 627,297 | | $ | 256,438 | | $ | 883,735 |
| |
Number of consumer loans written and renewed (in ones): | | | | | | | | | | | | | | | | | | |
Retail Services | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 390,393 | | | 54,997 | | | 445,390 | | | 408,886 | | | 68,960 | | | 477,846 |
| Installment loans | | | 1,828 | | | 983 | | | 2,811 | | | 1,772 | | | 662 | | | 2,434 |
| Total Retail Services | | | 392,221 | | | 55,980 | | | 448,201 | | | 410,658 | | | 69,622 | | | 480,280 |
E-Commerce | | | | | | | | | | | | | | | | | | |
| Domestic | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 251,404 | | | 263,650 | | | 515,054 | | | 268,856 | | | 271,250 | | | 540,106 |
| Line of credit accounts | | | 171,910 | | | - | | | 171,910 | | | 119,794 | | | - | | | 119,794 |
| Installment loans | | | 40,092 | | | - | | | 40,092 | | | 31,444 | | | - | | | 31,444 |
| Total Domestic | | | 463,406 | | | 263,650 | | | 727,056 | | | 420,094 | | | 271,250 | | | 691,344 |
| |
| Foreign | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 325,899 | | | 871 | | | 326,770 | | | 434,578 | | | 23,146 | | | 457,724 |
| Line of credit accounts | | | 164,200 | | | - | | | 164,200 | | | - | | | - | | | - |
| Installment loans | | | 76,498 | | | - | | | 76,498 | | | 30,336 | | | - | | | 30,336 |
| Total Foreign | | | 566,597 | | | 871 | | | 567,468 | | | 464,914 | | | 23,146 | | | 488,060 |
| Total E-Commerce | | | 1,030,003 | | | 264,521 | | | 1,294,524 | | | 885,008 | | | 294,396 | | | 1,179,404 |
| |
Total number of consumer loans written and renewed | | | 1,422,224 | | | 320,501 | | | 1,742,725 | | | 1,295,666 | | | 364,018 | | | 1,659,684 |
| | |
| (a) The disclosure regarding the amount and number of consumer loans written and renewed is statistical data that is not included in the Company’s financial statements. |
(b) Loans guaranteed by the Company represent loans originated by third-party lenders through the CSO programs. |
| |
| | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSUMER LOAN FINANCIAL AND OPERATING DATA |
| | |
| | Nine Months Ended September 30, |
| | 2013 | | 2012 |
| | Company
Owned(a) | | Guaranteed
by the
Company(a)(b) | | Combined(a) | | Company
Owned(a) | | Guaranteed
by the
Company(a)(b) | | Combined(a) |
Amount of consumer loans written and renewed (dollars in thousands): | | | | | | | | | | | | | | | | | | |
Retail Services | | | | | | | | | | | | | | | | | | |
| Short-term loans | | $ | 525,054 | | $ | 82,899 | | $ | 607,953 | | $ | 544,930 | | $ | 109,005 | | $ | 653,935 |
| Installment loans | | | 5,522 | | | 13,871 | | | 19,393 | | | 5,690 | | | 10,613 | | | 16,303 |
| Total Retail Services | | | 530,576 | | | 96,770 | | | 627,346 | | | 550,620 | | | 119,618 | | | 670,238 |
E-Commerce | | | | | | | | | | | | | | | | | | |
| Domestic | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 222,906 | | | 520,200 | | | 743,106 | | | 248,307 | | | 541,364 | | | 789,671 |
| Line of credit accounts | | | 113,543 | | | - | | | 113,543 | | | 82,679 | | | - | | | 82,679 |
| Installment loans | | | 104,299 | | | - | | | 104,299 | | | 57,354 | | | - | | | 57,354 |
| Total Domestic | | | 440,748 | | | 520,200 | | | 960,948 | | | 388,340 | | | 541,364 | | | 929,704 |
| |
| Foreign | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 688,108 | | | 14,572 | | | 702,680 | | | 738,682 | | | 52,724 | | | 791,406 |
| Line of credit accounts | | | 72,230 | | | - | | | 72,230 | | | - | | | - | | | - |
| Installment loans | | | 195,698 | | | - | | | 195,698 | | | 91,790 | | | - | | | 91,790 |
| Total Foreign | | | 956,036 | | | 14,572 | | | 970,608 | | | 830,472 | | | 52,724 | | | 883,196 |
| Total E-Commerce | | | 1,396,784 | | | 534,772 | | | 1,931,556 | | | 1,218,812 | | | 594,088 | | | 1,812,900 |
| |
Total amount of consumer loans written and renewed: | | $ | 1,927,360 | | $ | 631,542 | | $ | 2,558,902 | | $ | 1,769,432 | | $ | 713,706 | | $ | 2,483,138 |
| |
Number of consumer loans written and renewed (in ones): | | | | | | | | | | | | | | | | | | |
Retail Services | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 1,100,252 | | | 160,749 | | | 1,261,001 | | | 1,159,449 | | | 200,636 | | | 1,360,085 |
| Installment loans | | | 5,022 | | | 2,545 | | | 7,567 | | | 5,252 | | | 1,506 | | | 6,758 |
| Total Retail Services | | | 1,105,274 | | | 163,294 | | | 1,268,568 | | | 1,164,701 | | | 202,142 | | | 1,366,843 |
E-Commerce | | | | | | | | | | | | | | | | | | |
| Domestic | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 737,269 | | | 726,828 | | | 1,464,097 | | | 784,349 | | | 741,152 | | | 1,525,501 |
| Line of credit accounts | | | 423,111 | | | - | | | 423,111 | | | 290,879 | | | - | | | 290,879 |
| Installment loans | | | 93,506 | | | - | | | 93,506 | | | 57,255 | | | - | | | 57,255 |
| Total Domestic | | | 1,253,886 | | | 726,828 | | | 1,980,714 | | | 1,132,483 | | | 741,152 | | | 1,873,635 |
| |
| Foreign | | | | | | | | | | | | | | | | | | |
| Short-term loans | | | 1,247,096 | | | 19,106 | | | 1,266,202 | | | 1,359,841 | | | 69,645 | | | 1,429,486 |
| Line of credit accounts | | | 194,948 | | | - | | | 194,948 | | | - | | | - | | | - |
| Installment loans | | | 166,252 | | | - | | | 166,252 | | | 80,539 | | | - | | | 80,539 |
| Total Foreign | | | 1,608,296 | | | 19,106 | | | 1,627,402 | | | 1,440,380 | | | 69,645 | | | 1,510,025 |
| Total E-Commerce | | | 2,862,182 | | | 745,934 | | | 3,608,116 | | | 2,572,863 | | | 810,797 | | | 3,383,660 |
| |
Total number of consumer loans written and renewed | | | 3,967,456 | | | 909,228 | | | 4,876,684 | | | 3,737,564 | | | 1,012,939 | | | 4,750,503 |
| | |
| (a) The disclosure regarding the amount and number of consumer loans written and renewed is statistical data that is not included in the Company’s financial statements. |
| (b) Loans guaranteed by the Company represent loans originated by third-party lenders through the CSO programs. |
| |
| | | | | | | | | | | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES INCOME FROM OPERATIONS BY OPERATING SEGMENT |
| | | | | | | | | | | |
The following tables contain operating segment data for the three and nine months ended September 30, 2013 and 2012 by segment, for the Company’s corporate operations and on a consolidated basis (dollars in thousands). |
| | | | | | | | | | | |
| | Retail Services | | E-Commerce | | | | | | |
| | Domestic | | Foreign | | Total | | Domestic | | Foreign | | Total | | Corporate | | Consolidated |
| | | | | | | | | | | | | | | | | | | | | | | | |
Three Months Ended September 30, 2013 | | | | | | | | | | | | | | | | | | | | | | | | |
| Revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Pawn loan fees and service charges | | $ | 77,532 | | $ | 1,766 | | | $ | 79,298 | | $ | - | | $ | - | | $ | - | | $ | - | | | $ | 79,298 |
| Proceeds from disposition of merchandise | | | 124,352 | | | 4,308 | | | | 128,660 | | | - | | | - | | | - | | | - | | | | 128,660 |
| Consumer loan fees | | | 29,504 | | | - | | | | 29,504 | | | 104,954 | | | 93,105 | | | 198,059 | | | - | | | | 227,563 |
| Other | | | 1,731 | | | 66 | | | | 1,797 | | | 249 | | | 69 | | | 318 | | | 165 | | | | 2,280 |
| Total revenue | | | 233,119 | | | 6,140 | | | | 239,259 | | | 105,203 | | | 93,174 | | | 198,377 | | | 165 | | | | 437,801 |
| Cost of revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Disposed merchandise | | | 87,530 | | | 3,571 | | | | 91,101 | | | - | | | - | | | - | | | - | | | | 91,101 |
| Consumer loan loss provision | | | 10,037 | | | - | | | | 10,037 | | | 49,225 | | | 40,431 | | | 89,656 | | | - | | | | 99,693 |
| Total cost of revenue | | | 97,567 | | | 3,571 | | | | 101,138 | | | 49,225 | | | 40,431 | | | 89,656 | | | - | | | | 190,794 |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Net revenue | | | 135,552 | | | 2,569 | | | | 138,121 | | | 55,978 | | | 52,743 | | | 108,721 | | | 165 | | | | 247,007 |
| Expenses | | | | | | | | | | | | | | | | | | | | | | | | |
| Operations and administration | | | 111,220 | | | 2,831 | | | | 114,051 | | | 38,662 | | | 31,755 | | | 70,417 | | | 15,237 | | | | 199,705 |
| Depreciation and amortization | | | 9,878 | | | 764 | | | | 10,642 | | | 3,252 | | | 706 | | | 3,958 | | | 4,183 | | | | 18,783 |
| Total expenses | | | 121,098 | | | 3,595 | | | | 124,693 | | | 41,914 | | | 32,461 | | | 74,375 | | | 19,420 | | | | 218,488 |
| Income (loss) from operations | | $ | 14,454 | | $ | (1,026 | ) | | $ | 13,428 | | $ | 14,064 | | $ | 20,282 | | $ | 34,346 | | $ | (19,255 | ) | | $ | 28,519 |
As of September 30, 2013 | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 1,102,152 | | $ | 120,131 | | | $ | 1,222,283 | | $ | 420,914 | | $ | 216,341 | | $ | 637,255 | | $ | 131,791 | | | $ | 1,991,329 |
| Goodwill | | | | | | | | $ | 459,669 | | | | | | | | $ | 210,368 | | | | | $ | 670,037 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| | | Retail Services | | E-Commerce | | | | | | |
| | | Domestic | | Foreign | | Total | | Domestic | | Foreign | | Total | | Corporate | | Consolidated |
| | | | | | | | | | | | | | | | | | | | | | | | |
Three Months Ended September 30, 2012 | | | | | | | | | | | | | | | | | | | | | | | | |
| Revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Pawn loan fees and service charges | | $ | 73,209 | | $ | 3,291 | | | $ | 76,500 | | $ | - | | $ | - | | $ | - | | $ | - | | | $ | 76,500 |
| Proceeds from disposition of merchandise | | | 141,088 | | | 12,405 | | | | 153,493 | | | - | | | - | | | - | | | - | | | | 153,493 |
| Consumer loan fees | | | 31,445 | | | - | | | | 31,445 | | | 89,342 | | | 84,307 | | | 173,649 | | | - | | | | 205,094 |
| Other | | | 1,938 | | | 252 | | | | 2,190 | | | 374 | | | 14 | | | 388 | | | 2,029 | | | | 4,607 |
| Total revenue | | | 247,680 | | | 15,948 | | | | 263,628 | | | 89,716 | | | 84,321 | | | 174,037 | | | 2,029 | | | | 439,694 |
| Cost of revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Disposed merchandise | | | 96,315 | | | 10,603 | | | | 106,918 | | | - | | | - | | | - | | | - | | | | 106,918 |
| Consumer loan loss provision | | | 8,061 | | | - | | | | 8,061 | | | 42,877 | | | 33,361 | | | 76,238 | | | - | | | | 84,299 |
| Total cost of revenue | | | 104,376 | | | 10,603 | | | | 114,979 | | | 42,877 | | | 33,361 | | | 76,238 | | | - | | | | 191,217 |
| Net revenue | | | 143,304 | | | 5,345 | | | | 148,649 | | | 46,839 | | | 50,960 | | | 97,799 | | | 2,029 | | | | 248,477 |
| Expenses | | | | | | | | | | | | | | | | | | | | | | | | |
| Operations and administration | | | 84,874 | | | 14,205 | | | | 99,079 | | | 33,397 | | | 31,051 | | | 64,448 | | | 17,688 | | | | 181,215 |
| Depreciation and amortization | | | 7,808 | | | 12,264 | | | | 20,072 | | | 3,037 | | | 342 | | | 3,379 | | | 3,623 | | | | 27,074 |
| Total expenses | | | 92,682 | | | 26,469 | | | | 119,151 | | | 36,434 | | | 31,393 | | | 67,827 | | | 21,311 | | | | 208,289 |
| Income (loss) from operations | | $ | 50,622 | | $ | (21,124 | ) | | $ | 29,498 | | $ | 10,405 | | $ | 19,567 | | $ | 29,972 | | $ | (19,282 | ) | | $ | 40,188 |
As of September 30, 2012 | | | | | | | | | | | | | | | | | | | | | | | | |
| Total assets | | $ | 993,598 | | $ | 111,610 | | | $ | 1,105,208 | | $ | 382,459 | | $ | 174,665 | | $ | 557,124 | | $ | 130,075 | | | $ | 1,792,407 |
| Goodwill | | | | | | | | $ | 388,965 | | | | | | | | $ | 210,372 | | | | | $ | 599,337 |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES INCOME FROM OPERATIONS BY OPERATING SEGMENT (dollars in thousands) |
| | | | | | | | | | |
| | Retail Services | | E-Commerce | | | | | | |
| | Domestic | | Foreign | | Total | | Domestic | | Foreign | | Total | | Corporate | | Consolidated |
| | | | | | | | | | | | | | | | | | | | | | | | |
Nine Months Ended September 30, 2013 | | | | | | | | | | | | | | | | | | | | | | | | |
| Revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Pawn loan fees and service charges | | $ | 222,508 | | $ | 5,432 | | | $ | 227,940 | | $ | - | | $ | - | | $ | - | | $ | - | | | $ | 227,940 |
| Proceeds from disposition of merchandise | | | 425,716 | | | 13,193 | | | | 438,909 | | | - | | | - | | | - | | | - | | | | 438,909 |
| Consumer loan fees | | | 84,473 | | | - | | | | 84,473 | | | 283,097 | | | 272,629 | | | 555,726 | | | - | | | | 640,199 |
| Other | | | 6,149 | | | 988 | | | | 7,137 | | | 1,051 | | | 92 | | | 1,143 | | | 1,552 | | | | 9,832 |
| Total revenue | | | 738,846 | | | 19,613 | | | | 758,459 | | | 284,148 | | | 272,721 | | | 556,869 | | | 1,552 | | | | 1,316,880 |
| Cost of revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Disposed merchandise | | | 290,569 | | | 10,828 | | | | 301,397 | | | - | | | - | | | - | | | - | | | | 301,397 |
| Consumer loan loss provision | | | 23,927 | | | - | | | | 23,927 | | | 112,391 | | | 115,456 | | | 227,847 | | | - | | | | 251,774 |
| Total cost of revenue | | | 314,496 | | | 10,828 | | | | 325,324 | | | 112,391 | | | 115,456 | | | 227,847 | | | - | | | | 553,171 |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Net revenue | | | 424,350 | | | 8,785 | | | | 433,135 | | | 171,757 | | | 157,265 | | | 329,022 | | | 1,552 | | | | 763,709 |
| Expenses | | | | | | | | | | | | | | | | | | | | | | | | |
| Operations and administration | | | 291,409 | | | 10,003 | | | | 301,412 | | | 99,906 | | | 101,200 | | | 201,106 | | | 51,524 | | | | 554,042 |
| Depreciation and amortization | | | 27,579 | | | 1,593 | | | | 29,172 | | | 10,885 | | | 2,101 | | | 12,986 | | | 12,156 | | | | 54,314 |
| Total expenses | | | 318,988 | | | 11,596 | | | | 330,584 | | | 110,791 | | | 103,301 | | | 214,092 | | | 63,680 | | | | 608,356 |
| Income (loss) from operations | | $ | 105,362 | | $ | (2,811 | ) | | $ | 102,551 | | $ | 60,966 | | $ | 53,964 | | $ | 114,930 | | $ | (62,128 | ) | | $ | 155,353 |
| | | | | | | | | | |
| | | | | | | | | | |
| | Retail Services | | E-Commerce | | | | | | |
| | Domestic | | Foreign | | Total | | Domestic | | Foreign | | Total | | Corporate | | Consolidated |
| | | | | | | | | | | | | | | | | | | | | | | | |
Nine Months Ended September 30, 2012 | | | | | | | | | | | | | | | | | | | | | | | | |
| Revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Pawn loan fees and service charges | | $ | 210,807 | | $ | 10,643 | | | $ | 221,450 | | $ | - | | $ | - | | $ | - | | $ | - | | | $ | 221,450 |
| Proceeds from disposition of merchandise | | | 481,558 | | | 36,274 | | | | 517,832 | | | - | | | - | | | - | | | - | | | | 517,832 |
| Consumer loan fees | | | 89,396 | | | - | | | | 89,396 | | | 232,268 | | | 236,992 | | | 469,260 | | | - | | | | 558,656 |
| Other | | | 7,085 | | | 512 | | | | 7,597 | | | 827 | | | 19 | | | 846 | | | 2,445 | | | | 10,888 |
| Total revenue | | | 788,846 | | | 47,429 | | | | 836,275 | | | 233,095 | | | 237,011 | | | 470,106 | | | 2,445 | | | | 1,308,826 |
| Cost of revenue | | | | | | | | | | | | | | | | | | | | | | | | |
| Disposed merchandise | | | 318,788 | | | 32,090 | | | | 350,878 | | | - | | | - | | | - | | | - | | | | 350,878 |
| Consumer loan loss provision | | | 19,130 | | | - | | | | 19,130 | | | 95,474 | | | 104,475 | | | 199,949 | | | - | | | | 219,079 |
| Total cost of revenue | | | 337,918 | | | 32,090 | | | | 370,008 | | | 95,474 | | | 104,475 | | | 199,949 | | | - | | | | 569,957 |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Net revenue | | | 450,928 | | | 15,339 | | | | 466,267 | | | 137,621 | | | 132,536 | | | 270,157 | | | 2,445 | | | | 738,869 |
| Expenses | | | | | | | | | | | | | | | | | | | | | | | | |
| Operations and administration | | | 264,337 | | | 30,221 | | | | 294,558 | | | 82,986 | | | 85,552 | | | 168,538 | | | 52,464 | | | | 515,560 |
| Depreciation and amortization | | | 22,454 | | | 14,513 | | | | 36,967 | | | 8,376 | | | 905 | | | 9,281 | | | 10,634 | | | | 56,882 |
| Total expenses | | | 286,791 | | | 44,734 | | | | 331,525 | | | 91,362 | | | 86,457 | | | 177,819 | | | 63,098 | | | | 572,442 |
| Income (loss) from operations | | $ | 164,137 | | $ | (29,395 | ) | | $ | 134,742 | | $ | 46,259 | | $ | 46,079 | | $ | 92,338 | | $ | (60,653 | ) | | $ | 166,427 |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Corporate operations primarily include corporate expenses, such as legal, occupancy, executive oversight, insurance and risk management, public and government relations, internal audit, treasury, payroll, compliance and licensing, finance, accounting, tax and information systems (except for online lending systems, which are included in the e-commerce segment). Corporate income includes miscellaneous income not directly attributable to the Company’s segments. Corporate assets primarily include corporate property and equipment, nonqualified savings plan assets, marketable securities, foreign exchange forward contracts and prepaid insurance.
| |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
LOCATION INFORMATION |
Retail Services Segment
The following table sets forth the number of domestic and foreign Company-owned and franchised locations in the Company’s retail services segment offering pawn lending, consumer lending, and other ancillary services as of September 30, 2013 and 2012. The Company’s domestic retail services locations operate under the names “Cash America Pawn,” “SuperPawn,” “Cash America Payday Advance,” “Cashland” and “Mr. Payroll.” In addition, certain domestic retail services locations acquired in late 2012 and 2013 that operate under various names that are expected to be changed to “Cash America Pawn” during 2013. The Company’s foreign retail services locations operate under the name “Cash America casa de empeño.”
| | |
| | As of September 30, |
| | 2013 | | 2012 |
| | Domestic(a) | | Foreign | | Total | | Domestic(a)(b) | | Foreign | | Total |
| Retail services locations offering: | | | | | | | | | | | | |
| Both pawn and consumer lending | | 581 | | - | | 581 | | 577 | | - | | 577 |
| Pawn lending only | | 211 | | 47 | | 258 | | 155 | | 160 | | 315 |
| Consumer lending only | | 68 | | - | | 68 | | 83 | | - | | 83 |
| Other (c) | | 88 | | - | | 88 | | 99 | | - | | 99 |
| Total retail services | | 948 | | 47 | | 995 | | 914 | | 160 | | 1,074 |
| | |
| (a) Except as described in (c) below, includes locations operating in 22 and 23 states in the United States as of September 30, 2013 and 2012, respectively. |
| (b) Includes one unconsolidated franchised location operating under the name “Cash America Pawn” as of September 30, 2012. |
| (c) As of September 30, 2013 and 2012, includes 88 and 93 unconsolidated franchised check cashing locations, respectively, and as of September 30, 2012, includes six consolidated Company-owned check cashing locations. As of September 30, 2013 and 2012, includes locations operating in 13 and 15 states in the United States, respectively. |
| |
E-Commerce Segment
As of September 30, 2013 and 2012, the Company’s e-commerce segment operated in 32 states in the United States and in three foreign countries:
- in the United States at http://www.cashnetusa.com and http://www.netcredit.com,
- in the United Kingdom at http://www.quickquid.co.uk and http://www.poundstopocket.co.uk,
- in Australia at http://www.dollarsdirect.com.au, and
- in Canada at http://www.dollarsdirect.ca.
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
NON-GAAP DISCLOSURE |
ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE |
Adjusted Earnings and Adjusted Earnings Per Share
In addition to reporting financial results in accordance with GAAP, the Company has provided adjusted earnings and adjusted earnings per share, which are non-GAAP measures. Management believes that the presentation of these measures provides investors with greater transparency and facilitates comparison of operating results across a broad spectrum of companies with varying capital structures, compensation strategies, derivative instruments and amortization methods, which provides a more complete understanding of the Company’s financial performance, competitive position and prospects for the future. Management also believes that investors regularly rely on non-GAAP financial measures, such as adjusted earnings and adjusted earnings per share, to assess operating performance and that such measures may highlight trends in the Company’s business that may not otherwise be apparent when relying on financial measures calculated in accordance with GAAP. In addition, management believes that the adjustments shown below, especially the adjustments related to the Company’s deduction for its tax basis in the stock of one of its subsidiaries in connection with the Mexico Reorganization (as defined below) (the “Creazione Deduction”), the settlement of litigation in 2013 that remains subject to court approval (the “2013 Litigation Settlement”), the withdrawal in July 2012 of the proposed initial public offering of common stock of the Company’s wholly-owned subsidiary, Enova International, Inc., (the “Enova IPO”) and the reorganization of the Company's Mexico-based pawn lending operations during 2012 (the “Mexico Reorganization”), are useful to investors in order to allow them to compare the Company's financial results for the current quarter and current nine-month period with the prior year quarter and the prior year nine-month period, respectively.
| | | | | | |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES NON-GAAP DISCLOSURE ADJUSTED EARNINGS AND ADJUSTED EARNINGS PER SHARE |
| | | | | |
The following table provides a reconciliation for the three and nine months ended September 30, 2013 and 2012 between net income attributable to the Company and diluted earnings per share calculated in accordance with GAAP to adjusted earnings and adjusted earnings per share, respectively, which are shown net of tax (dollars in thousands, except per share data): |
| | | | | |
| | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2013 | | 2012 | | 2013 | | 2012 |
| | | $ | | | Per
Diluted
Share(a) | | $ | | | Per
Diluted
Share(a) | | $ | | | Per
Diluted
Share(a) | | $ | | Per
Diluted
Share(a) |
Net income and diluted earnings per share attributable to Cash America International, Inc. | | $ | 46,186 | | | $ | 1.52 | | | $ | 11,703 | | | $ | 0.37 | | $ | 115,244 | | | $ | 3.73 | | | $ | 82,990 | | $ | 2.62 |
| Adjustments (net of tax): | | | | | | | | | | | | | | | | | | | | | | | | |
Tax benefit related to Creazione Deduction(b) | | | (33,201 | ) | | | (1.09 | ) | | | - | | | | - | | | (33,201 | ) | | | (1.08 | ) | | | - | | | - |
| 2013 Litigation Settlement(c) | | | 11,340 | | | | 0.37 | | | | - | | | | - | | | 11,340 | | | | 0.37 | | | | - | | | - |
Charges related to withdrawn proposed Enova IPO(d) | | | - | | | | - | | | | 1,941 | | | | 0.06 | | | - | | | | - | | | | 2,461 | | | 0.08 |
Charges related to the Mexico Reorganization(e) | | | - | | | | - | | | | 18,456 | | | | 0.59 | | | - | | | | - | | | | 18,456 | | | 0.58 |
| Subtotal | | | 24,325 | | | | 0.80 | | | | 32,100 | | | | 1.02 | | | 93,383 | | | | 3.02 | | | | 103,907 | | | 3.28 |
| Other adjustments (net of tax): | | | | | | | | | | | | | | | | | | | | | | | | |
| Intangible asset amortization | | | 1,014 | | | | 0.03 | | | | 639 | | | | 0.02 | | | 2,675 | | | | 0.10 | | | | 2,042 | | | 0.06 |
| Non-cash equity-based compensation | | | 698 | | | | 0.02 | | | | 564 | | | | 0.02 | | | 2,456 | | | | 0.08 | | | | 2,481 | | | 0.08 |
Convertible debt non-cash interest and issuance cost amortization | | | 634 | | | | 0.02 | | | | 601 | | | | 0.02 | | | 1,897 | | | | 0.06 | | | | 1,766 | | | 0.06 |
| Foreign currency transaction loss (gain) | | | 467 | | | | 0.02 | | | | (58 | ) | | | - | | | 663 | | | | 0.02 | | | | 45 | | | - |
| Adjusted earnings and adjusted earnings per share | | $ | 27,138 | | | $ | 0.89 | | | $ | 33,846 | | | $ | 1.08 | | $ | 101,074 | | | $ | 3.28 | | | $ | 110,241 | | $ | 3.48 |
| | | | | | | | | | | | | | | | | | | | | | | | | |
(a) Diluted shares are calculated by giving effect to the potential dilution that could occur if securities or other contracts to issue common shares were exercised and converted into common shares during the period. |
(b) Represents income benefit related to the Creazione Deduction. |
(c) Represents charges related to the 2013 Litigation Settlement of $18.0 million, net of tax benefit of $6.7 million. |
(d) Represents charges directly related to the withdrawn Enova IPO. For the three months ended September 30, 2012, represents $3.1 million of charges, net of tax benefit of $1.2 million. For the nine months ended September 30, 2012, represents $3.9 million of charges, net of tax benefit of $1.5 million. |
(e) Represents charges related to the Mexico Reorganization. For the three and nine months ended September 30, 2012, represents $21.9 million of charges, net of tax benefit of $1.2 million and noncontrolling interest of $2.2 million. |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| |
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
NON-GAAP DISCLOSURE |
ADJUSTED EBITDA |
Adjusted EBITDA
The table below shows adjusted EBITDA, a non-GAAP measure that the Company defines as earnings excluding depreciation, amortization, interest, foreign currency transaction gains or losses, equity in earnings or loss of unconsolidated subsidiary and provision for income taxes and including the net income or loss attributable to noncontrolling interests. Management believes adjusted EBITDA is used by investors to analyze operating performance and evaluate the Company’s ability to incur and service debt and its capacity for making capital expenditures. Adjusted EBITDA is also useful to investors to help assess the Company’s liquidity and estimated enterprise value. In addition, management believes that the adjustments shown below, especially the adjustments for charges related to events that occurred during the third quarter of 2013 and the third and fourth quarters of 2012, such as the 2013 Litigation Settlement, the withdrawn Enova IPO, the Mexico Reorganization, and the voluntary reimbursements to Ohio customers (the “Ohio Reimbursements”) are useful to investors in order to allow them to compare the Company’s financial results for the current and prior year trailing 12 months. The computation of adjusted EBITDA as presented below may differ from the computation of similarly-titled measures provided by other companies (dollars in thousands):
| | | | Trailing 12 Months Ended | |
| | | September 30, | |
| | | 2013 | | 2012 | |
Net income attributable to Cash America International, Inc. | | $ | 139,724 | | | $ | 120,817 | | |
| Adjustments: | | | | | | | |
| 2013 Litigation settlement(a) | | | 18,000 | | | | - | | |
| Charges related to withdrawn proposed Enova IPO(b) | | | - | | | | 3,879 | | |
| Charges related to Mexico Reorganization(c) | | | 6,965 | | | | 21,908 | | |
| Charges related to Ohio Reimbursements(d) | | | 13,400 | | | | - | | |
| Depreciation and amortization expenses(e) | | | 71,377 | | | | 60,350 | | |
| Interest expense, net | | | 33,540 | | | | 28,182 | | |
| Foreign currency transaction loss | | | 1,294 | | | | 279 | | |
| Loss on extinguishment of debt | | | 346 | | | | - | | |
| Equity in loss of unconsolidated subsidiary | | | 222 | | | | 243 | | |
| Provision for income taxes(f) | | | 29,896 | | | | 83,409 | | |
| Net loss attributable to the noncontrolling interest | | | (181 | ) | | | (5,539 | ) | (g) |
| Adjusted EBITDA | | $ | 314,583 | | | $ | 313,528 | | |
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| Adjusted EBITDA margin calculated as follows: | | | | | | | |
| Total revenue | | $ | 1,808,484 | | | $ | 1,782,783 | | |
| Adjusted EBITDA | | $ | 314,583 | | | $ | 313,528 | | |
| Adjusted EBITDA as a percentage of total revenue | | | 17.4 | % | | | 17.6 | % | |
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(a) Represents charges related to the 2013 Litigation Settlement of $18.0 million, before tax benefit of $6.7 million. |
(b) Represents charges directly related to the withdrawn Enova IPO, before tax benefit of $1.5 million |
(c) For the trailing twelve months ended September 30, 2013, represents charges related to the Mexico Reorganization, and includes $1.5 million of depreciation and amortization expense as noted in (e) below. For the trailing twelve months ended September 30, 2012, represents charges related to the Mexico Reorganization, before tax benefit of $1.2 million and noncontrolling interest of $2.3 million.( )Includes $11.1 million and $7.2 million of depreciation and amortization expenses and charges for the recognition of a deferred tax asset valuation allowance, respectively, as noted in (e) and (f) below. |
(d) Represents charges related to the Ohio Reimbursements, before tax benefit of $5.0 million. |
(e) Excludes $1.5 million and $11.1 million of depreciation and amortization expenses for the trailing twelve months ended September 30, 2013 and 2012, respectively, which are included in “Charges related to the Mexico Reorganization” in the table above. |
(f) For the trailing twelve months ended September 30, 2013, includes income benefit of $33.2 million related to the Creazione Deduction. For the trailing twelve months ended September 30, 2012, excludes a $7.2 million charge for the recognition of a deferred tax asset valuation allowance which is included in “Charges related to the Mexico Reorganization” in the table above and includes an income tax benefit related to the Mexico Reorganization of $1.2 million. |
(g) Includes $2.3 million of noncontrolling interests related to the Mexico Reorganization. |
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
NON-GAAP DISCLOSURE |
Non-GAAP Disclosure
In addition to the financial information prepared in conformity with GAAP the Company provides historical non-GAAP financial information. Management 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 the Company’s business that, when viewed with its GAAP results, provide a more complete understanding of factors and trends affecting its 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 or superior to, its 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
