Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 23, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | FIRSTCASH, INC. | |
Entity Central Index Key | 840,489 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 45,415,242 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
ASSETS | |||
Cash and cash equivalents | $ 110,408 | $ 114,423 | $ 73,148 |
Fees and service charges receivable | 40,022 | 42,736 | 38,021 |
Pawn loans | 322,625 | 344,748 | 314,505 |
Consumer loans, net | 17,447 | 23,522 | 22,209 |
Inventories | 254,298 | 276,771 | 308,165 |
Income taxes receivable | 24 | 19,761 | 18,419 |
Prepaid expenses and other current assets | 21,575 | 20,236 | 14,331 |
Total current assets | 766,399 | 842,197 | 788,798 |
Property and equipment, net | 234,126 | 230,341 | 237,258 |
Goodwill | 844,516 | 831,145 | 835,567 |
Intangible assets, net | 91,764 | 93,819 | 101,594 |
Other assets | 54,392 | 54,045 | 69,088 |
Deferred tax assets | 12,499 | 11,237 | 11,249 |
Total assets | 2,003,696 | 2,062,784 | 2,043,554 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||
Accounts payable and accrued liabilities | 88,328 | 84,331 | 79,726 |
Customer deposits | 35,692 | 32,019 | 36,983 |
Income taxes payable | 12,266 | 4,221 | 1,041 |
Total current liabilities | 136,286 | 120,571 | 117,750 |
Revolving unsecured credit facility | 83,000 | 107,000 | 137,000 |
Senior unsecured notes | 295,400 | 295,243 | 196,721 |
Deferred tax liabilities | 49,063 | 47,037 | 74,368 |
Other liabilities | 15,661 | 17,600 | 30,480 |
Total liabilities | 579,410 | 587,451 | 556,319 |
Stockholders’ equity: | |||
Preferred stock | 0 | 0 | 0 |
Common stock | 493 | 493 | 493 |
Additional paid-in capital | 1,220,491 | 1,220,356 | 1,217,756 |
Retained earnings | 525,847 | 494,457 | 410,874 |
Accumulated other comprehensive loss | (90,043) | (111,877) | (96,801) |
Common stock held in treasury, at cost | (232,502) | (128,096) | (45,087) |
Total stockholders’ equity | 1,424,286 | 1,475,333 | 1,487,235 |
Total liabilities and stockholders’ equity | $ 2,003,696 | $ 2,062,784 | $ 2,043,554 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenue: | ||
Retail merchandise sales | $ 269,841 | $ 259,994 |
Pawn loan fees | 129,793 | 128,251 |
Wholesale scrap jewelry sales | 34,725 | 38,111 |
Consumer loan and credit services fees | 15,441 | 21,220 |
Total revenue | 449,800 | 447,576 |
Cost of revenue: | ||
Cost of retail merchandise sold | 174,497 | 165,635 |
Cost of wholesale scrap jewelry sold | 32,495 | 34,949 |
Consumer loan and credit services loss provision | 3,727 | 4,092 |
Total cost of revenue | 210,719 | 204,676 |
Net revenue | 239,081 | 242,900 |
Expenses and other income: | ||
Store operating expenses | 138,561 | 136,744 |
Administrative expenses | 28,002 | 33,238 |
Depreciation and amortization | 11,283 | 14,243 |
Interest expense | 6,198 | 6,113 |
Interest income | (981) | (327) |
Merger and other acquisition expenses | 239 | 647 |
Total expenses and other income | 183,302 | 190,658 |
Income (loss) before income taxes | 55,779 | 52,242 |
Provision for income taxes | 14,144 | 19,597 |
Net income | $ 41,635 | $ 32,645 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.90 | $ 0.67 |
Diluted (in dollars per share) | 0.90 | 0.67 |
Dividends declared per common share (in dollars per share) | $ 0.22 | $ 0.19 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 41,635 | $ 32,645 |
Other comprehensive income: | ||
Currency translation adjustment | 21,834 | 23,005 |
Comprehensive income | $ 63,469 | $ 55,650 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Gain (Loss) on Investments [Line Items] | ||
Net Tax Benefit | $ (14,144) | $ (19,597) |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Common Stock Held in Treasury |
Balance at beginning of period (shares) at Dec. 31, 2016 | 0 | 49,276 | 769 | ||||
Balance at beginning of period (value) at Dec. 31, 2016 | $ 1,449,986 | $ 0 | $ 493 | $ 1,217,969 | $ 387,401 | $ (119,806) | $ (36,071) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares issued under share-based compensation plan (shares) | 0 | (10) | |||||
Shares issued under share-based compensation plan (value) | 0 | $ 0 | (440) | $ 440 | |||
Exercise of stock options (shares) | (13) | ||||||
Exercise of stock options (value) | 0 | (549) | $ 549 | ||||
Share-based compensation expense (value) | 776 | 776 | |||||
Net income | 32,645 | 32,645 | |||||
Dividends paid | (9,172) | (9,172) | |||||
Currency translation adjustment | 23,005 | 23,005 | |||||
Repurchases of treasury stock (shares) | 228 | ||||||
Repurchases of treasury stock (value) | (10,005) | $ (10,005) | |||||
Balance at end of period (shares) at Mar. 31, 2017 | 0 | 49,276 | 974 | ||||
Balance at end of period (value) at Mar. 31, 2017 | 1,487,235 | $ 0 | $ 493 | 1,217,756 | 410,874 | (96,801) | $ (45,087) |
Balance at beginning of period (shares) at Dec. 31, 2017 | 0 | 49,276 | 2,362 | ||||
Balance at beginning of period (value) at Dec. 31, 2017 | 1,475,333 | $ 0 | $ 493 | 1,220,356 | 494,457 | (111,877) | $ (128,096) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares issued under share-based compensation plan (shares) | 0 | (22) | |||||
Shares issued under share-based compensation plan (value) | 0 | $ 0 | (1,240) | $ 1,240 | |||
Share-based compensation expense (value) | 1,375 | 1,375 | |||||
Net income | 41,635 | 41,635 | |||||
Dividends paid | (10,245) | (10,245) | |||||
Currency translation adjustment | 21,834 | 21,834 | |||||
Repurchases of treasury stock (shares) | 1,378 | ||||||
Repurchases of treasury stock (value) | (105,646) | $ (105,646) | |||||
Balance at end of period (shares) at Mar. 31, 2018 | 0 | 49,276 | 3,718 | ||||
Balance at end of period (value) at Mar. 31, 2018 | $ 1,424,286 | $ 0 | $ 493 | $ 1,220,491 | $ 525,847 | $ (90,043) | $ (232,502) |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flow from operating activities: | ||
Net income | $ 41,635 | $ 32,645 |
Adjustments to reconcile net income to net cash flow provided by operating activities: | ||
Non-cash portion of credit loss provision | 1,874 | 2,639 |
Share-based compensation expense | 1,375 | 776 |
Depreciation and amortization expense | 11,283 | 14,243 |
Amortization of debt issuance costs | 480 | 467 |
Amortization of favorable/(unfavorable) lease intangibles, net | (466) | (237) |
Deferred income taxes, net | 1,609 | 12,550 |
Changes in operating assets and liabilities, net of business combinations: | ||
Fees and service charges receivable | 3,844 | 3,865 |
Inventories | 7,715 | 6,796 |
Prepaid expenses and other assets | (3,174) | 11,594 |
Accounts payable, accrued liabilities and other liabilities | (2,478) | (29,071) |
Income taxes | 27,619 | 7,598 |
Net cash flow provided by operating activities | 91,316 | 63,865 |
Cash flow from investing activities: | ||
Loan receivables, net of cash repayments | 56,220 | 67,189 |
Purchases of property and equipment | (8,837) | (8,076) |
Acquisitions of pawn stores, net of cash acquired | (13,364) | (854) |
Net cash flow provided by investing activities | 34,019 | 58,259 |
Cash flow from financing activities: | ||
Borrowings from revolving unsecured credit facility | 61,000 | 15,000 |
Repayments of revolving unsecured credit facility | (85,000) | (138,000) |
Purchases of treasury stock | (100,019) | (10,005) |
Dividends paid | (10,245) | (9,172) |
Net cash flow used in financing activities | (134,264) | (142,177) |
Effect of exchange rates on cash | 4,914 | 3,246 |
Change in cash and cash equivalents | (4,015) | (16,807) |
Cash and cash equivalents at beginning of the period | 114,423 | 89,955 |
Cash and cash equivalents at end of the period | $ 110,408 | $ 73,148 |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated balance sheet at December 31, 2017 , which is derived from audited financial statements, and the unaudited condensed consolidated financial statements, including the notes thereto, include the accounts of FirstCash, Inc. and its wholly-owned subsidiaries (together, the “Company”). The Company regularly makes acquisitions and the results of operations for the acquired stores have been consolidated since the acquisition dates. All significant intercompany accounts and transactions have been eliminated. See Note 3 . These unaudited consolidated financial statements are condensed and do not include all disclosures and footnotes required by generally accepted accounting principles in the United States of America for complete financial statements. These interim period financial statements should be read in conjunction with the Company’s consolidated financial statements, which are included in the Company’s annual report on Form 10-K for the year ended December 31, 2017 , filed with the Securities and Exchange Commission (the “SEC”) on February 20, 2018 . The condensed consolidated financial statements as of March 31, 2018 and 2017 , and for the three month periods ended March 31, 2018 and 2017 , are unaudited, but in management’s opinion include all adjustments (consisting of only normal recurring adjustments) considered necessary to present fairly the financial position, results of operations and cash flow for such interim periods. Operating results for the period ended March 31, 2018 are not necessarily indicative of the results that may be expected for the full fiscal year. The Company has significant operations in Latin America, where in Mexico, Guatemala and Colombia the functional currency is the Mexican peso, Guatemalan quetzal and Colombian peso, respectively. Accordingly, the assets and liabilities of these subsidiaries are translated into U.S. dollars at the exchange rate in effect at each balance sheet date, and the resulting adjustments are accumulated in other comprehensive income (loss) as a separate component of stockholders’ equity. Revenues and expenses are translated at the average exchange rates occurring during the three month periods ended March 31, 2018 and 2017 . The Company also has operations in El Salvador where the reporting and functional currency is the U.S. dollar. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 is a comprehensive revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In August 2015, the Financial Accounting Standards Board issued ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606),” which delayed the effective date of ASU 2014-09 by one year. In addition, between March 2016 and December 2016, the Financial Accounting Standards Board issued ASU No. 2016-08, “Revenue from Contracts with Customers - Principal versus Agent Considerations (Reporting revenue gross versus net)” (“ASU 2016-08”), ASU No. 2016-10, “Identifying Performance Obligations and Licensing” (“ASU 2016-10”), ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), and ASU No. 2016-20, “Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers” (“ASU 2016-20”). ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 clarify certain aspects of ASU 2014-09 and provide additional implementation guidance. ASU 2014-09, ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 (collectively, “ASC 606”) became effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017 for public companies. Entities are permitted to adopt ASC 606 using one of two methods: (a) full retrospective adoption, meaning the standard is applied to all periods presented, or (b) modified retrospective adoption, meaning the cumulative effect of applying the new standard is recognized as an adjustment to the opening retained earnings balance. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective method. The adoption of ASC 606 did not impact the Company’s revenue recognition for pawn loan fees, consumer loan fees, or credit services fees, as each of these revenue streams is outside of the scope of ASC 606. Further, the Company has not identified any impacts to its consolidated financial statements that were material as a result of the adoption of ASC 606 for its retail merchandise sales or wholesale scrap jewelry sales revenue streams. The Company has not changed the presentation of its consolidated financial statements for assets, liabilities, or revenues from contracts with customers, nor has the Company recognized any cumulative effect adjustment as a result of the adoption of ASC 606. In February 2016, the Financial Accounting Standards Board issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 requires a lessee to recognize, in the statement of financial position, a liability to make lease payments (the lease liability) and a right-to-use asset representing its right to use the underlying asset for the lease term. Leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the income statement. Lessor accounting remains largely unchanged. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods, with early adoption permitted. An entity will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently assessing the potential impact of ASU 2016-02 on its consolidated financial statements. In June 2016, the Financial Accounting Standards Board issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. ASU 2016-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently assessing the potential impact of ASU 2016-13 on its consolidated financial statements. In August 2016, the Financial Accounting Standards Board issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”). ASU 2016-15 clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. ASU 2016-15 addresses eight specific cash flow issues with the objective of reducing existing diversity in practice. ASU 2016-15 became effective for public entities for fiscal years beginning after December 15, 2017. The adoption of ASU 2016-15 did not have a material effect on the Company’s consolidated financial statements or financial statement disclosures. In January 2017, the Financial Accounting Standards Board issued ASU No. 2017-01, “Business Combinations (Topic 805) - Clarifying the Definition of a Business” (“ASU 2017-01”). ASU 2017-01 provides amendments to clarify the definition of a business and affects all companies and other reporting organizations that must determine whether they have acquired or sold a business. The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The guidance became effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years and should be applied prospectively as of the beginning of the period of adoption. The adoption of ASU 2017-01 did not have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In January 2017, the Financial Accounting Standards Board issued ASU No. 2017-04, “Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). These amendments eliminate step 2 from the goodwill impairment test. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The guidance is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017 and should be adopted on a prospective basis. The Company does not expect ASU 2017-04 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In March 2018, the Financial Accounting Standards Board issued ASU No 2018-05, “Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118” (“ASU 2018-05”), which became effective immediately. ASU 2018-05 adds various SEC paragraphs pursuant to the issuance of the December 2017 SEC Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”). See Note 6 for additional information regarding the adoption of ASU 2018-05. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Numerator: Net income $ 41,635 $ 32,645 Denominator (in thousands): Weighted-average common shares for calculating basic earnings per share 46,426 48,389 Effect of dilutive securities: Stock options and nonvested common stock awards 53 13 Weighted-average common shares for calculating diluted earnings per share 46,479 48,402 Net income per share: Basic $ 0.90 $ 0.67 Diluted $ 0.90 $ 0.67 |
Acquisitions (Notes)
Acquisitions (Notes) | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | Acquisitions Consistent with the Company’s strategy to continue its expansion of pawn stores in selected markets, during the three months ended March 31, 2018 , the Company acquired 126 stores in Mexico and three single pawn stores located in the U.S. in four separate transactions. The all-cash aggregate purchase price for these acquisitions was $15.5 million , net of cash acquired and subject to future post-closing adjustments. The purchases were composed of $13.4 million in cash paid during the three months ended March 31, 2018 and remaining payables to the sellers of approximately $2.1 million . The purchase price of each acquisition was allocated to assets and liabilities acquired based upon their estimated fair market values at the date of acquisition. The excess purchase price over the estimated fair market value of the net assets acquired and liabilities assumed has been recorded as goodwill. The goodwill arising from these acquisitions consists largely of the synergies and economies of scale expected from combining the operations of the Company and the pawn stores acquired. These acquisitions were not material individually or in the aggregate to the Company’s consolidated financial statements. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt The following table details the Company’s long-term debt at the respective principal amounts, net of unamortized debt issuance costs (in thousands): March 31, December 31, 2018 2017 2017 Senior unsecured notes: 5.375% senior notes due 2024 (1) $ 295,400 $ — $ 295,243 6.75% senior notes due 2021 (2) — 196,721 — $ 295,400 $ 196,721 $ 295,243 Revolving unsecured credit facility, maturing 2022 $ 83,000 $ 137,000 $ 107,000 (1) As of March 31, 2018 and December 31, 2017 , deferred debt issuance costs of $4.6 million and $4.8 million , respectively, are included as a direct deduction from the carrying amount of the senior unsecured notes due 2024 in the accompanying condensed consolidated balance sheets. (2) As of March 31, 2017 , deferred debt issuance costs of $3.3 million are included as a direct deduction from the carrying amount of the senior unsecured notes due 2021 in the accompanying condensed consolidated balance sheets. Senior Unsecured Notes On May 30, 2017, the Company issued $300.0 million of 5.375% senior notes due on June 1, 2024 (the “Notes”), all of which are currently outstanding. Interest on the Notes is payable semi-annually in arrears on June 1 and December 1. The Notes are fully and unconditionally guaranteed on a senior unsecured basis jointly and severally by all of the Company's existing and future domestic subsidiaries that guarantee its primary revolving bank credit facility. The Notes will permit the Company to make restricted payments, such as purchasing shares of its stock and paying cash dividends, in an unlimited amount if, after giving pro forma effect to the incurrence of any indebtedness to make such payment, the Company's consolidated total debt ratio (“Net Debt Ratio”) is less than 2.25 to 1 . The Net Debt Ratio is defined generally in the indenture governing the Notes as the ratio of (1) the total consolidated debt of the Company minus cash and cash equivalents of the Company to (2) the Company’s consolidated trailing twelve months EBITDA, as adjusted to exclude certain non-recurring expenses and giving pro forma effect to operations acquired during the measurement period. Revolving Credit Facility At March 31, 2018 , the Company maintained a line of credit with a group of U.S. based commercial lenders (the “2016 Credit Facility”) in the amount of $400.0 million , which matures on September 2, 2022 . At March 31, 2018 , the Company had $83.0 million in outstanding borrowings and $5.1 million in outstanding letters of credit under the 2016 Credit Facility, leaving $311.9 million available for future borrowings. The 2016 Credit Facility bears interest, at the Company’s option, at either (i) the prevailing London Interbank Offered Rate (“LIBOR”) (with interest periods of 1 week or 1, 2, 3 or 6 months at the Company’s option) plus a fixed spread of 2.5% or (ii) the prevailing prime or base rate plus a fixed spread of 1.5% . The agreement has a LIBOR floor of 0% . Additionally, the Company is required to pay an annual commitment fee of 0.50% on the average daily unused portion of the 2016 Credit Facility commitment. The weighted-average interest rate on amounts outstanding under the 2016 Credit Facility at March 31, 2018 was 4.25% based on 1 week LIBOR. Under the terms of the 2016 Credit Facility, the Company is required to maintain certain financial ratios and comply with certain financial covenants. The 2016 Credit Facility also contains customary restrictions on the Company’s ability to incur additional debt, grant liens, make investments, consummate acquisitions and similar negative covenants with customary carve-outs and baskets. The Company was in compliance with the requirements and covenants of the 2016 Credit Facility as of March 31, 2018 . During the three months ended March 31, 2018 , the Company made net payments of $24.0 million pursuant to the 2016 Credit Facility. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of financial instruments is determined by reference to various market data and other valuation techniques, as appropriate. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The three fair value levels are (from highest to lowest): Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. Recurring Fair Value Measurements As of March 31, 2018 , 2017 and December 31, 2017 , the Company did not have any financial assets or liabilities measured at fair value on a recurring basis. Fair Value Measurements on a Nonrecurring Basis The Company measures non-financial assets and liabilities such as property and equipment and intangible assets at fair value on a nonrecurring basis or when events or circumstances indicate that the carrying amount of the assets may be impaired. Financial Assets and Liabilities Not Measured at Fair Value The Company’s financial assets and liabilities as of March 31, 2018 , 2017 and December 31, 2017 that are not measured at fair value in the condensed consolidated balance sheets are as follows (in thousands): Carrying Value Estimated Fair Value March 31, March 31, Fair Value Measurements Using 2018 2018 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 110,408 $ 110,408 $ 110,408 $ — $ — Pawn loans 322,625 322,625 — — 322,625 Consumer loans, net 17,447 17,447 — — 17,447 Fees and service charges receivable 40,022 40,022 — — 40,022 $ 490,502 $ 490,502 $ 110,408 $ — $ 380,094 Financial liabilities: Revolving unsecured credit facility $ 83,000 $ 83,000 $ — $ 83,000 $ — Senior unsecured notes, outstanding principal 300,000 305,000 — 305,000 — $ 383,000 $ 388,000 $ — $ 388,000 $ — Carrying Value Estimated Fair Value March 31, March 31, Fair Value Measurements Using 2017 2017 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 73,148 $ 73,148 $ 73,148 $ — $ — Pawn loans 314,505 314,505 — — 314,505 Consumer loans, net 22,209 22,209 — — 22,209 Fees and service charges receivable 38,021 38,021 — — 38,021 $ 447,883 $ 447,883 $ 73,148 $ — $ 374,735 Financial liabilities: Revolving unsecured credit facility $ 137,000 $ 137,000 $ — $ 137,000 $ — Senior unsecured notes, outstanding principal 200,000 208,000 — 208,000 — $ 337,000 $ 345,000 $ — $ 345,000 $ — Carrying Value Estimated Fair Value December 31, December 31, Fair Value Measurements Using 2017 2017 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 114,423 $ 114,423 $ 114,423 $ — $ — Pawn loans 344,748 344,748 — — 344,748 Consumer loans, net 23,522 23,522 — — 23,522 Fees and service charges receivable 42,736 42,736 — — 42,736 $ 525,429 $ 525,429 $ 114,423 $ — $ 411,006 Financial liabilities: Revolving unsecured credit facility $ 107,000 $ 107,000 $ — $ 107,000 $ — Senior unsecured notes, outstanding principal 300,000 314,000 — 314,000 — $ 407,000 $ 421,000 $ — $ 421,000 $ — As cash and cash equivalents have maturities of less than three months, the carrying value of cash and cash equivalents approximates fair value. Due to their short-term maturities, the carrying value of pawn loans and fees and service charges receivable approximate fair value. Short-term loans and installment loans, collectively, represent consumer loans, net on the accompanying condensed consolidated balance sheets and are carried net of the allowance for estimated loan losses, which is calculated by applying historical loss rates combined with recent default trends to the gross consumer loan balance. The unobservable inputs used to calculate the fair value of these loans include historical loss rates, recent default trends and estimated remaining loan terms. Therefore, the carrying value approximates the fair value. The carrying value of the Company’s revolving unsecured credit facility approximates fair value as of March 31, 2018 , 2017 and December 31, 2017 . The fair value of the senior unsecured notes have been estimated based on a discounted cash flow analysis using a discount rate representing the Company’s estimate of the rate that would be used by market participants. Changes in assumptions or estimation methodologies may have a material effect on these estimated fair values. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Act”) was enacted into law. The Tax Act significantly changed U.S. corporate income tax law by, among other things, reducing the U.S. corporate income tax rate from 35% to 21% starting in 2018 and creating a territorial tax system with a one-time mandatory tax on previously deferred foreign earnings of U.S. corporations. The Company’s effective tax rate for the three months ended March 31, 2018 was 25.4% compared to 37.5% , for the three months ended March 31, 2017 . The decrease in the effective tax rate for the three months ended March 31, 2018 reflects the reduced U.S. corporate income tax rate as a result of the passage of the Tax Act blended with the statutory tax rates of the Company’s foreign subsidiaries which are 30% , 25% and 30% in Mexico, Guatemala and El Salvador, respectively. In December 2017, the SEC issued SAB 118 to address concerns about reporting entities’ ability to timely comply with the accounting requirements to recognize all of the effects of the Tax Act in the period of enactment. SAB 118 allows disclosure that timely determination of some or all of the income tax effects from the Tax Act are incomplete by the due date of the financial statements and if possible to provide a reasonable estimate. As a result of the Tax Act, the Company recorded a provisional net income tax benefit of $27.3 million in fourth quarter of 2017. As of March 31, 2018 , no adjustments to the estimates used to determine the provisional net tax benefit have been made. Any adjustments will be included in the provision for income taxes in the reporting period in which any such adjustments are determined, which will be no later than the fourth quarter of 2018. See Note 11 in the accompanying notes to the consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2017 for further information on the provisional income tax benefit. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company organizes its operations into two reportable segments as follows: • U.S. operations - Includes all pawn and consumer loan operations in the U.S. • Latin America operations - Includes all pawn and consumer loan operations in Latin America, which currently includes operations in Mexico, Guatemala, El Salvador and Colombia The following tables present reportable segment information for the three month period ended March 31, 2018 and 2017 (in thousands): Three Months Ended March 31, 2018 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 186,052 $ 83,789 $ — $ 269,841 Pawn loan fees 96,242 33,551 — 129,793 Wholesale scrap jewelry sales 29,457 5,268 — 34,725 Consumer loan and credit services fees 15,039 402 — 15,441 Total revenue 326,790 123,010 — 449,800 Cost of revenue: Cost of retail merchandise sold 120,616 53,881 — 174,497 Cost of wholesale scrap jewelry sold 27,653 4,842 — 32,495 Consumer loan and credit services loss provision 3,644 83 — 3,727 Total cost of revenue 151,913 58,806 — 210,719 Net revenue 174,877 64,204 — 239,081 Expenses and other income: Store operating expenses 104,383 34,178 — 138,561 Administrative expenses — — 28,002 28,002 Depreciation and amortization 5,555 2,709 3,019 11,283 Interest expense — — 6,198 6,198 Interest income — — (981 ) (981 ) Merger and other acquisition expenses — — 239 239 Total expenses and other income 109,938 36,887 36,477 183,302 Income (loss) before income taxes $ 64,939 $ 27,317 $ (36,477 ) $ 55,779 Three Months Ended March 31, 2017 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 193,666 $ 66,328 $ — $ 259,994 Pawn loan fees 101,818 26,433 — 128,251 Wholesale scrap jewelry sales 32,897 5,214 — 38,111 Consumer loan and credit services fees 20,815 405 — 21,220 Total revenue 349,196 98,380 — 447,576 Cost of revenue: Cost of retail merchandise sold 123,497 42,138 — 165,635 Cost of wholesale scrap jewelry sold 30,682 4,267 — 34,949 Consumer loan and credit services loss provision 3,990 102 — 4,092 Total cost of revenue 158,169 46,507 — 204,676 Net revenue 191,027 51,873 — 242,900 Expenses and other income: Store operating expenses 107,968 28,776 — 136,744 Administrative expenses — — 33,238 33,238 Depreciation and amortization 6,419 2,397 5,427 14,243 Interest expense — — 6,113 6,113 Interest income — — (327 ) (327 ) Merger and other acquisition expenses — — 647 647 Total expenses and other income 114,387 31,173 45,098 190,658 Income (loss) before income taxes $ 76,640 $ 20,700 $ (45,098 ) $ 52,242 |
Significant Accounting Polici15
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated balance sheet at December 31, 2017 , which is derived from audited financial statements, and the unaudited condensed consolidated financial statements, including the notes thereto, include the accounts of FirstCash, Inc. and its wholly-owned subsidiaries (together, the “Company”). The Company regularly makes acquisitions and the results of operations for the acquired stores have been consolidated since the acquisition dates. All significant intercompany accounts and transactions have been eliminated. See Note 3 . These unaudited consolidated financial statements are condensed and do not include all disclosures and footnotes required by generally accepted accounting principles in the United States of America for complete financial statements. These interim period financial statements should be read in conjunction with the Company’s consolidated financial statements, which are included in the Company’s annual report on Form 10-K for the year ended December 31, 2017 , filed with the Securities and Exchange Commission (the “SEC”) on February 20, 2018 . The condensed consolidated financial statements as of March 31, 2018 and 2017 , and for the three month periods ended March 31, 2018 and 2017 , are unaudited, but in management’s opinion include all adjustments (consisting of only normal recurring adjustments) considered necessary to present fairly the financial position, results of operations and cash flow for such interim periods. Operating results for the period ended March 31, 2018 are not necessarily indicative of the results that may be expected for the full fiscal year. The Company has significant operations in Latin America, where in Mexico, Guatemala and Colombia the functional currency is the Mexican peso, Guatemalan quetzal and Colombian peso, respectively. Accordingly, the assets and liabilities of these subsidiaries are translated into U.S. dollars at the exchange rate in effect at each balance sheet date, and the resulting adjustments are accumulated in other comprehensive income (loss) as a separate component of stockholders’ equity. Revenues and expenses are translated at the average exchange rates occurring during the three month periods ended March 31, 2018 and 2017 . The Company also has operations in El Salvador where the reporting and functional currency is the U.S. dollar. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 is a comprehensive revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In August 2015, the Financial Accounting Standards Board issued ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606),” which delayed the effective date of ASU 2014-09 by one year. In addition, between March 2016 and December 2016, the Financial Accounting Standards Board issued ASU No. 2016-08, “Revenue from Contracts with Customers - Principal versus Agent Considerations (Reporting revenue gross versus net)” (“ASU 2016-08”), ASU No. 2016-10, “Identifying Performance Obligations and Licensing” (“ASU 2016-10”), ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), and ASU No. 2016-20, “Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers” (“ASU 2016-20”). ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 clarify certain aspects of ASU 2014-09 and provide additional implementation guidance. ASU 2014-09, ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 (collectively, “ASC 606”) became effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017 for public companies. Entities are permitted to adopt ASC 606 using one of two methods: (a) full retrospective adoption, meaning the standard is applied to all periods presented, or (b) modified retrospective adoption, meaning the cumulative effect of applying the new standard is recognized as an adjustment to the opening retained earnings balance. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective method. The adoption of ASC 606 did not impact the Company’s revenue recognition for pawn loan fees, consumer loan fees, or credit services fees, as each of these revenue streams is outside of the scope of ASC 606. Further, the Company has not identified any impacts to its consolidated financial statements that were material as a result of the adoption of ASC 606 for its retail merchandise sales or wholesale scrap jewelry sales revenue streams. The Company has not changed the presentation of its consolidated financial statements for assets, liabilities, or revenues from contracts with customers, nor has the Company recognized any cumulative effect adjustment as a result of the adoption of ASC 606. In February 2016, the Financial Accounting Standards Board issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 requires a lessee to recognize, in the statement of financial position, a liability to make lease payments (the lease liability) and a right-to-use asset representing its right to use the underlying asset for the lease term. Leases will be classified as either financing or operating, with classification affecting the pattern of expense recognition in the income statement. Lessor accounting remains largely unchanged. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods, with early adoption permitted. An entity will be required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently assessing the potential impact of ASU 2016-02 on its consolidated financial statements. In June 2016, the Financial Accounting Standards Board issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. ASU 2016-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently assessing the potential impact of ASU 2016-13 on its consolidated financial statements. In August 2016, the Financial Accounting Standards Board issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”). ASU 2016-15 clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. ASU 2016-15 addresses eight specific cash flow issues with the objective of reducing existing diversity in practice. ASU 2016-15 became effective for public entities for fiscal years beginning after December 15, 2017. The adoption of ASU 2016-15 did not have a material effect on the Company’s consolidated financial statements or financial statement disclosures. In January 2017, the Financial Accounting Standards Board issued ASU No. 2017-01, “Business Combinations (Topic 805) - Clarifying the Definition of a Business” (“ASU 2017-01”). ASU 2017-01 provides amendments to clarify the definition of a business and affects all companies and other reporting organizations that must determine whether they have acquired or sold a business. The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The guidance became effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years and should be applied prospectively as of the beginning of the period of adoption. The adoption of ASU 2017-01 did not have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In January 2017, the Financial Accounting Standards Board issued ASU No. 2017-04, “Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”). These amendments eliminate step 2 from the goodwill impairment test. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform step 2 of the goodwill impairment test. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The guidance is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017 and should be adopted on a prospective basis. The Company does not expect ASU 2017-04 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In March 2018, the Financial Accounting Standards Board issued ASU No 2018-05, “Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118” (“ASU 2018-05”), which became effective immediately. ASU 2018-05 adds various SEC paragraphs pursuant to the issuance of the December 2017 SEC Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”). See Note 6 for additional information regarding the adoption of ASU 2018-05. |
Fair Value Measurement | The fair value of financial instruments is determined by reference to various market data and other valuation techniques, as appropriate. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The three fair value levels are (from highest to lowest): Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted earnings per share | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Numerator: Net income $ 41,635 $ 32,645 Denominator (in thousands): Weighted-average common shares for calculating basic earnings per share 46,426 48,389 Effect of dilutive securities: Stock options and nonvested common stock awards 53 13 Weighted-average common shares for calculating diluted earnings per share 46,479 48,402 Net income per share: Basic $ 0.90 $ 0.67 Diluted $ 0.90 $ 0.67 |
Long-Term Debt Schedule of Long
Long-Term Debt Schedule of Long-term Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The following table details the Company’s long-term debt at the respective principal amounts, net of unamortized debt issuance costs (in thousands): March 31, December 31, 2018 2017 2017 Senior unsecured notes: 5.375% senior notes due 2024 (1) $ 295,400 $ — $ 295,243 6.75% senior notes due 2021 (2) — 196,721 — $ 295,400 $ 196,721 $ 295,243 Revolving unsecured credit facility, maturing 2022 $ 83,000 $ 137,000 $ 107,000 (1) As of March 31, 2018 and December 31, 2017 , deferred debt issuance costs of $4.6 million and $4.8 million , respectively, are included as a direct deduction from the carrying amount of the senior unsecured notes due 2024 in the accompanying condensed consolidated balance sheets. (2) As of March 31, 2017 , deferred debt issuance costs of $3.3 million are included as a direct deduction from the carrying amount of the senior unsecured notes due 2021 in the accompanying condensed consolidated balance sheets. |
Fair Value of Financial Instr18
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping | The Company’s financial assets and liabilities as of March 31, 2018 , 2017 and December 31, 2017 that are not measured at fair value in the condensed consolidated balance sheets are as follows (in thousands): Carrying Value Estimated Fair Value March 31, March 31, Fair Value Measurements Using 2018 2018 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 110,408 $ 110,408 $ 110,408 $ — $ — Pawn loans 322,625 322,625 — — 322,625 Consumer loans, net 17,447 17,447 — — 17,447 Fees and service charges receivable 40,022 40,022 — — 40,022 $ 490,502 $ 490,502 $ 110,408 $ — $ 380,094 Financial liabilities: Revolving unsecured credit facility $ 83,000 $ 83,000 $ — $ 83,000 $ — Senior unsecured notes, outstanding principal 300,000 305,000 — 305,000 — $ 383,000 $ 388,000 $ — $ 388,000 $ — Carrying Value Estimated Fair Value March 31, March 31, Fair Value Measurements Using 2017 2017 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 73,148 $ 73,148 $ 73,148 $ — $ — Pawn loans 314,505 314,505 — — 314,505 Consumer loans, net 22,209 22,209 — — 22,209 Fees and service charges receivable 38,021 38,021 — — 38,021 $ 447,883 $ 447,883 $ 73,148 $ — $ 374,735 Financial liabilities: Revolving unsecured credit facility $ 137,000 $ 137,000 $ — $ 137,000 $ — Senior unsecured notes, outstanding principal 200,000 208,000 — 208,000 — $ 337,000 $ 345,000 $ — $ 345,000 $ — Carrying Value Estimated Fair Value December 31, December 31, Fair Value Measurements Using 2017 2017 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 114,423 $ 114,423 $ 114,423 $ — $ — Pawn loans 344,748 344,748 — — 344,748 Consumer loans, net 23,522 23,522 — — 23,522 Fees and service charges receivable 42,736 42,736 — — 42,736 $ 525,429 $ 525,429 $ 114,423 $ — $ 411,006 Financial liabilities: Revolving unsecured credit facility $ 107,000 $ 107,000 $ — $ 107,000 $ — Senior unsecured notes, outstanding principal 300,000 314,000 — 314,000 — $ 407,000 $ 421,000 $ — $ 421,000 $ — |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following tables present reportable segment information for the three month period ended March 31, 2018 and 2017 (in thousands): Three Months Ended March 31, 2018 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 186,052 $ 83,789 $ — $ 269,841 Pawn loan fees 96,242 33,551 — 129,793 Wholesale scrap jewelry sales 29,457 5,268 — 34,725 Consumer loan and credit services fees 15,039 402 — 15,441 Total revenue 326,790 123,010 — 449,800 Cost of revenue: Cost of retail merchandise sold 120,616 53,881 — 174,497 Cost of wholesale scrap jewelry sold 27,653 4,842 — 32,495 Consumer loan and credit services loss provision 3,644 83 — 3,727 Total cost of revenue 151,913 58,806 — 210,719 Net revenue 174,877 64,204 — 239,081 Expenses and other income: Store operating expenses 104,383 34,178 — 138,561 Administrative expenses — — 28,002 28,002 Depreciation and amortization 5,555 2,709 3,019 11,283 Interest expense — — 6,198 6,198 Interest income — — (981 ) (981 ) Merger and other acquisition expenses — — 239 239 Total expenses and other income 109,938 36,887 36,477 183,302 Income (loss) before income taxes $ 64,939 $ 27,317 $ (36,477 ) $ 55,779 Three Months Ended March 31, 2017 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 193,666 $ 66,328 $ — $ 259,994 Pawn loan fees 101,818 26,433 — 128,251 Wholesale scrap jewelry sales 32,897 5,214 — 38,111 Consumer loan and credit services fees 20,815 405 — 21,220 Total revenue 349,196 98,380 — 447,576 Cost of revenue: Cost of retail merchandise sold 123,497 42,138 — 165,635 Cost of wholesale scrap jewelry sold 30,682 4,267 — 34,949 Consumer loan and credit services loss provision 3,990 102 — 4,092 Total cost of revenue 158,169 46,507 — 204,676 Net revenue 191,027 51,873 — 242,900 Expenses and other income: Store operating expenses 107,968 28,776 — 136,744 Administrative expenses — — 33,238 33,238 Depreciation and amortization 6,419 2,397 5,427 14,243 Interest expense — — 6,113 6,113 Interest income — — (327 ) (327 ) Merger and other acquisition expenses — — 647 647 Total expenses and other income 114,387 31,173 45,098 190,658 Income (loss) before income taxes $ 76,640 $ 20,700 $ (45,098 ) $ 52,242 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share [Abstract] | ||
Net income | $ 41,635 | $ 32,645 |
Denominator (in thousands): | ||
Weighted-average common shares for calculating basic earnings per share (shares) | 46,426 | 48,389 |
Stock options and nonvested stock awards (shares) | 53 | 13 |
Weighted-average common shares for calculating diluted earnings per share (shares) | 46,479 | 48,402 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.90 | $ 0.67 |
Diluted (in dollars per share) | $ 0.90 | $ 0.67 |
Acquisitions Business Combinati
Acquisitions Business Combinations Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018USD ($)store | Mar. 31, 2017USD ($) | |
Entity Location [Line Items] | ||
Number of acquisitions | store | 4 | |
Purchase price | $ | $ 15,500 | |
Payments to Acquire Businesses, Net of Cash Acquired | $ | 13,364 | $ 854 |
Business Combination, Consideration Transferred, Liabilities Incurred | $ | $ 2,100 | |
U.S. Acquisition | ||
Entity Location [Line Items] | ||
Number of stores acquired | store | 3 | |
Mexico Acquisition | Latin America Acquisition | ||
Entity Location [Line Items] | ||
Number of stores acquired | store | 126 |
Long-Term Debt (Details)
Long-Term Debt (Details) | 3 Months Ended | |||
Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | May 30, 2017USD ($) | Mar. 31, 2017USD ($) | |
Debt Instrument [Line Items] | ||||
Unamortized debt issuance costs | $ 295,400,000 | $ 295,243,000 | $ 196,721,000 | |
Deferred finance costs, net | $ 4,600,000 | 4,800,000 | 3,300,000 | |
Debt ratio | 2.25 | |||
Line of Credit | 2016 Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Amount outstanding | $ 83,000,000 | 107,000,000 | 137,000,000 | |
Maximum borrowing capacity | 400,000,000 | |||
Letters of credit outstanding, amount | 5,100,000 | |||
Remaining borrowing capacity | $ 311,900,000 | |||
Unused capacity, commitment fee percentage | 0.50% | |||
Interest rate at end of period (percent) | 4.25% | |||
Net proceeds | $ (24,000,000) | |||
Line of Credit | 2016 Credit Facility | 30-day LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate (percent) | 2.50% | |||
Line of Credit | 2016 Credit Facility | Prime Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate (percent) | 1.50% | |||
Line of Credit | Minimum | 2016 Credit Facility | 30-day LIBOR | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percent) | 0.00% | |||
Senior notes 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percent) | 5.375% | |||
Face amount | $ 300,000,000 | |||
Senior notes 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percent) | 5.375% | |||
Unamortized debt issuance costs | $ 295,400,000 | 295,243,000 | 0 | |
Senior notes 2021 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate (percent) | 6.75% | |||
Unamortized debt issuance costs | $ 0 | $ 0 | $ 196,721,000 |
Fair Value of Financial Instr23
Fair Value of Financial Instruments Financial Assets and Liabilities Not Measured at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Carrying Value | |||
Financial assets: | |||
Cash and cash equivalents | $ 110,408 | $ 114,423 | $ 73,148 |
Fees and service charges receivable | 40,022 | 42,736 | 38,021 |
Total assets | 490,502 | 525,429 | 447,883 |
Financial liabilities: | |||
Total liabilities | 383,000 | 407,000 | 337,000 |
Carrying Value | Pawn loans | |||
Financial assets: | |||
Loans receivable | 322,625 | 344,748 | 314,505 |
Carrying Value | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 17,447 | 23,522 | 22,209 |
Carrying Value | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 83,000 | 107,000 | 137,000 |
Carrying Value | Senior unsecured notes, outstanding principal | |||
Financial liabilities: | |||
Debt | 300,000 | 300,000 | 200,000 |
Estimated Fair Value | |||
Financial assets: | |||
Cash and cash equivalents | 110,408 | 114,423 | 73,148 |
Fees and service charges receivable | 40,022 | 42,736 | 38,021 |
Total assets | 490,502 | 525,429 | 447,883 |
Financial liabilities: | |||
Total liabilities | 388,000 | 421,000 | 345,000 |
Estimated Fair Value | Pawn loans | |||
Financial assets: | |||
Loans receivable | 322,625 | 344,748 | 314,505 |
Estimated Fair Value | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 17,447 | 23,522 | 22,209 |
Estimated Fair Value | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 83,000 | 107,000 | 137,000 |
Estimated Fair Value | Senior unsecured notes, outstanding principal | |||
Financial liabilities: | |||
Debt | 305,000 | 314,000 | 208,000 |
Estimated Fair Value | Level 1 | |||
Financial assets: | |||
Cash and cash equivalents | 110,408 | 114,423 | 73,148 |
Fees and service charges receivable | 0 | 0 | 0 |
Total assets | 110,408 | 114,423 | 73,148 |
Financial liabilities: | |||
Total liabilities | 0 | 0 | 0 |
Estimated Fair Value | Level 1 | Pawn loans | |||
Financial assets: | |||
Loans receivable | 0 | 0 | 0 |
Estimated Fair Value | Level 1 | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 0 | 0 | 0 |
Estimated Fair Value | Level 1 | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 0 | 0 | 0 |
Estimated Fair Value | Level 1 | Senior unsecured notes, outstanding principal | |||
Financial liabilities: | |||
Debt | 0 | 0 | 0 |
Estimated Fair Value | Level 2 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | 0 |
Fees and service charges receivable | 0 | 0 | 0 |
Total assets | 0 | 0 | 0 |
Financial liabilities: | |||
Total liabilities | 388,000 | 421,000 | 345,000 |
Estimated Fair Value | Level 2 | Pawn loans | |||
Financial assets: | |||
Loans receivable | 0 | 0 | 0 |
Estimated Fair Value | Level 2 | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 0 | 0 | 0 |
Estimated Fair Value | Level 2 | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 83,000 | 107,000 | 137,000 |
Estimated Fair Value | Level 2 | Senior unsecured notes, outstanding principal | |||
Financial liabilities: | |||
Debt | 305,000 | 314,000 | 208,000 |
Estimated Fair Value | Level 3 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | 0 |
Fees and service charges receivable | 40,022 | 42,736 | 38,021 |
Total assets | 380,094 | 411,006 | 374,735 |
Financial liabilities: | |||
Total liabilities | 0 | 0 | 0 |
Estimated Fair Value | Level 3 | Pawn loans | |||
Financial assets: | |||
Loans receivable | 322,625 | 344,748 | 314,505 |
Estimated Fair Value | Level 3 | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 17,447 | 23,522 | 22,209 |
Estimated Fair Value | Level 3 | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 0 | 0 | 0 |
Estimated Fair Value | Level 3 | Senior unsecured notes, outstanding principal | |||
Financial liabilities: | |||
Debt | $ 0 | $ 0 | $ 0 |
Income Taxes Income Tax Narrati
Income Taxes Income Tax Narrative (Details) - USD ($) $ in Millions | Dec. 22, 2017 | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 |
Entity Location [Line Items] | ||||
Tax Cuts and Jobs Act of 2017, Incomplete Accounting, Provisional Income Tax Expense (Benefit) | $ 27.3 | |||
UNITED STATES | ||||
Entity Location [Line Items] | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | 25.3572% | 37.512% | |
MEXICO | ||||
Entity Location [Line Items] | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 30.00% | |||
GUATEMALA | ||||
Entity Location [Line Items] | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% | |||
EL SALVADOR | ||||
Entity Location [Line Items] | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 30.00% |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | |
Schedule of Revenues from External Customers [Line Items] | ||
Number of reportable segments | 2 | |
Revenue: | ||
Retail merchandise sales | $ 269,841 | $ 259,994 |
Pawn loan fees | 129,793 | 128,251 |
Wholesale scrap jewelry sales | 34,725 | 38,111 |
Consumer loan and credit services fees | 15,441 | 21,220 |
Total revenue | 449,800 | 447,576 |
Cost of revenue: | ||
Cost of retail merchandise sold | 174,497 | 165,635 |
Cost of wholesale scrap jewelry sold | 32,495 | 34,949 |
Consumer loan and credit services loss provision | 3,727 | 4,092 |
Total cost of revenue | 210,719 | 204,676 |
Net revenue | 239,081 | 242,900 |
Expenses and other income: | ||
Store operating expenses | 138,561 | 136,744 |
Administrative expenses | 28,002 | 33,238 |
Depreciation and amortization | 11,283 | 14,243 |
Interest expense | 6,198 | 6,113 |
Interest income | (981) | (327) |
Merger and other acquisition expenses | 239 | 647 |
Total expenses and other income | 183,302 | 190,658 |
Income (loss) before income taxes | 55,779 | 52,242 |
U.S. Operations | ||
Revenue: | ||
Retail merchandise sales | 186,052 | 193,666 |
Pawn loan fees | 96,242 | 101,818 |
Wholesale scrap jewelry sales | 29,457 | 32,897 |
Consumer loan and credit services fees | 15,039 | 20,815 |
Total revenue | 326,790 | 349,196 |
Cost of revenue: | ||
Cost of retail merchandise sold | 120,616 | 123,497 |
Cost of wholesale scrap jewelry sold | 27,653 | 30,682 |
Consumer loan and credit services loss provision | 3,644 | 3,990 |
Total cost of revenue | 151,913 | 158,169 |
Net revenue | 174,877 | 191,027 |
Expenses and other income: | ||
Store operating expenses | 104,383 | 107,968 |
Administrative expenses | 0 | 0 |
Depreciation and amortization | 5,555 | 6,419 |
Interest expense | 0 | 0 |
Interest income | 0 | 0 |
Merger and other acquisition expenses | 0 | 0 |
Total expenses and other income | 109,938 | 114,387 |
Income (loss) before income taxes | 64,939 | 76,640 |
Latin America Operations | ||
Revenue: | ||
Retail merchandise sales | 83,789 | 66,328 |
Pawn loan fees | 33,551 | 26,433 |
Wholesale scrap jewelry sales | 5,268 | 5,214 |
Consumer loan and credit services fees | 402 | 405 |
Total revenue | 123,010 | 98,380 |
Cost of revenue: | ||
Cost of retail merchandise sold | 53,881 | 42,138 |
Cost of wholesale scrap jewelry sold | 4,842 | 4,267 |
Consumer loan and credit services loss provision | 83 | 102 |
Total cost of revenue | 58,806 | 46,507 |
Net revenue | 64,204 | 51,873 |
Expenses and other income: | ||
Store operating expenses | 34,178 | 28,776 |
Administrative expenses | 0 | 0 |
Depreciation and amortization | 2,709 | 2,397 |
Interest expense | 0 | 0 |
Interest income | 0 | 0 |
Merger and other acquisition expenses | 0 | 0 |
Total expenses and other income | 36,887 | 31,173 |
Income (loss) before income taxes | 27,317 | 20,700 |
Corporate | ||
Revenue: | ||
Retail merchandise sales | 0 | 0 |
Pawn loan fees | 0 | 0 |
Wholesale scrap jewelry sales | 0 | 0 |
Consumer loan and credit services fees | 0 | 0 |
Total revenue | 0 | 0 |
Cost of revenue: | ||
Cost of retail merchandise sold | 0 | 0 |
Cost of wholesale scrap jewelry sold | 0 | 0 |
Consumer loan and credit services loss provision | 0 | 0 |
Total cost of revenue | 0 | 0 |
Net revenue | 0 | 0 |
Expenses and other income: | ||
Store operating expenses | 0 | 0 |
Administrative expenses | 28,002 | 33,238 |
Depreciation and amortization | 3,019 | 5,427 |
Interest expense | 6,198 | 6,113 |
Interest income | (981) | (327) |
Merger and other acquisition expenses | 239 | 647 |
Total expenses and other income | 36,477 | 45,098 |
Income (loss) before income taxes | $ (36,477) | $ (45,098) |