Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 25, 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 | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 43,832,215 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 |
ASSETS | |||
Cash and cash equivalents | $ 57,025 | $ 114,423 | $ 93,411 |
Fees and service charges receivable | 49,141 | 42,736 | 45,134 |
Pawn loans | 387,733 | 344,748 | 371,367 |
Consumer loans, net | 17,804 | 23,522 | 24,515 |
Inventories | 277,438 | 276,771 | 308,683 |
Income taxes receivable | 1,065 | 19,761 | 27,867 |
Prepaid expenses and other current assets | 18,396 | 20,236 | 23,818 |
Total current assets | 808,602 | 842,197 | 894,795 |
Property and equipment, net | 250,088 | 230,341 | 234,309 |
Goodwill | 906,322 | 831,145 | 834,883 |
Intangible assets, net | 88,900 | 93,819 | 95,991 |
Other assets | 50,635 | 54,045 | 59,054 |
Deferred tax assets | 11,933 | 11,237 | 12,694 |
Total assets | 2,116,480 | 2,062,784 | 2,131,726 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||
Accounts payable and accrued liabilities | 103,223 | 84,331 | 94,769 |
Customer deposits | 35,874 | 32,019 | 37,626 |
Income taxes payable | 279 | 4,221 | 3,763 |
Total current liabilities | 139,376 | 120,571 | 136,158 |
Revolving unsecured credit facility | 305,000 | 107,000 | 140,000 |
Senior unsecured notes | 295,722 | 295,243 | 294,961 |
Deferred tax liabilities | 52,149 | 47,037 | 73,203 |
Other liabilities | 12,505 | 17,600 | 19,725 |
Total liabilities | 804,752 | 587,451 | 664,047 |
Stockholders’ equity: | |||
Preferred stock | 0 | 0 | 0 |
Common stock | 493 | 493 | 493 |
Additional paid-in capital | 1,222,947 | 1,220,356 | 1,219,589 |
Retained earnings | 569,691 | 494,457 | 436,159 |
Accumulated other comprehensive loss | (97,970) | (111,877) | (88,445) |
Common stock held in treasury, at cost | (383,433) | (128,096) | (100,117) |
Total stockholders’ equity | 1,311,728 | 1,475,333 | 1,467,679 |
Total liabilities and stockholders’ equity | $ 2,116,480 | $ 2,062,784 | $ 2,131,726 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue: | ||||
Retail merchandise sales | $ 256,417 | $ 246,334 | $ 782,000 | $ 750,150 |
Pawn loan fees | 134,613 | 132,545 | 387,418 | 383,428 |
Wholesale scrap jewelry sales | 24,650 | 37,528 | 86,850 | 107,285 |
Consumer loan and credit services fees | 14,198 | 19,005 | 43,382 | 58,754 |
Total revenue | 429,878 | 435,412 | 1,299,650 | 1,299,617 |
Cost of revenue: | ||||
Cost of retail merchandise sold | 163,287 | 161,350 | 501,358 | 483,458 |
Cost of wholesale scrap jewelry sold | 23,859 | 36,831 | 80,430 | 102,370 |
Consumer loan and credit services loss provision | 5,474 | 6,185 | 13,095 | 15,419 |
Total cost of revenue | 192,620 | 204,366 | 594,883 | 601,247 |
Net revenue | 237,258 | 231,046 | 704,767 | 698,370 |
Expenses and other income: | ||||
Store operating expenses | 141,755 | 138,966 | 417,899 | 412,780 |
Administrative expenses | 29,977 | 29,999 | 87,699 | 93,542 |
Depreciation and amortization | 10,850 | 13,872 | 33,085 | 42,804 |
Interest expense | 7,866 | 6,129 | 20,593 | 17,827 |
Interest income | (495) | (418) | (2,216) | (1,138) |
Merger and other acquisition expenses | 3,222 | 911 | 5,574 | 3,164 |
Loss on extinguishment of debt | 0 | 20 | 0 | 14,114 |
Total expenses and other income | 193,175 | 189,479 | 562,634 | 583,093 |
Income (loss) before income taxes | 44,083 | 41,567 | 142,133 | 115,277 |
Provision for income taxes | 10,758 | 13,293 | 37,002 | 39,119 |
Net income | $ 33,325 | $ 28,274 | $ 105,131 | $ 76,158 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.76 | $ 0.59 | $ 2.33 | $ 1.58 |
Diluted (in dollars per share) | 0.76 | 0.59 | 2.33 | 1.58 |
Dividends declared per common share (in dollars per share) | $ 0.22 | $ 0.19 | $ 0.66 | $ 0.570 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 33,325 | $ 28,274 | $ 105,131 | $ 76,158 |
Other comprehensive income: | ||||
Currency translation adjustment | 16,698 | (4,981) | 13,907 | 31,361 |
Comprehensive income | $ 50,023 | $ 23,293 | $ 119,038 | $ 107,519 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Gain (Loss) on Securities [Line Items] | ||||
Net Tax Benefit | $ (10,758) | $ (13,293) | $ (37,002) | $ (39,119) |
CONDENSED CONSOLIDATED STATEM_4
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) | 307 | (242) | $ 549 | ||||
Share-based compensation expense (value) | 2,302 | 2,302 | |||||
Net income | 76,158 | 76,158 | |||||
Dividends paid | (27,400) | (27,400) | |||||
Currency translation adjustment | 31,361 | 31,361 | |||||
Repurchases of treasury stock (shares) | 1,182 | ||||||
Repurchases of treasury stock (value) | (65,035) | $ (65,035) | |||||
Balance at end of period (shares) at Sep. 30, 2017 | 0 | 49,276 | 1,928 | ||||
Balance at end of period (value) at Sep. 30, 2017 | 1,467,679 | $ 0 | $ 493 | 1,219,589 | 436,159 | (88,445) | $ (100,117) |
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 | |||
Exercise of stock options (shares) | 0 | (10) | |||||
Exercise of stock options (value) | 400 | $ 0 | (294) | $ 694 | |||
Share-based compensation expense (value) | 4,125 | 4,125 | |||||
Net income | 105,131 | 105,131 | |||||
Dividends paid | (29,897) | (29,897) | |||||
Currency translation adjustment | 13,907 | 13,907 | |||||
Repurchases of treasury stock (shares) | 3,114 | ||||||
Repurchases of treasury stock (value) | (257,271) | $ (257,271) | |||||
Balance at end of period (shares) at Sep. 30, 2018 | 0 | 49,276 | 5,444 | ||||
Balance at end of period (value) at Sep. 30, 2018 | $ 1,311,728 | $ 0 | $ 493 | $ 1,222,947 | $ 569,691 | $ (97,970) | $ (383,433) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flow from operating activities: | ||
Net income | $ 105,131 | $ 76,158 |
Adjustments to reconcile net income to net cash flow provided by operating activities: | ||
Non-cash portion of credit loss provision | 7,101 | 10,012 |
Share-based compensation expense | 4,125 | 2,302 |
Depreciation and amortization expense | 33,085 | 42,804 |
Amortization of debt issuance costs | 1,448 | 1,322 |
Amortization of favorable/(unfavorable) lease intangibles, net | (341) | (744) |
Loss on extinguishment of debt | 0 | 14,114 |
Deferred income taxes, net | 4,953 | 11,137 |
Changes in operating assets and liabilities, net of business combinations: | ||
Fees and service charges receivable | (3,988) | (3,017) |
Inventories | 3,227 | 5,206 |
Prepaid expenses and other assets | (10) | 7,819 |
Accounts payable, accrued liabilities and other liabilities | 4,857 | (21,036) |
Income taxes | 14,631 | 2,769 |
Net cash flow provided by operating activities | 174,219 | 148,846 |
Cash flow from investing activities: | ||
Loan receivables, net of cash repayments | (13,055) | 5,261 |
Purchases of property and equipment | (40,754) | (26,595) |
Acquisitions of pawn stores, net of cash acquired | (88,387) | (1,141) |
Net cash flow used in investing activities | (142,196) | (22,475) |
Cash flow from financing activities: | ||
Borrowings from revolving unsecured credit facility | 357,500 | 181,000 |
Repayments of revolving unsecured credit facility | (159,500) | (301,000) |
Issuance of senior unsecured notes | 0 | 300,000 |
Repurchase/redemption of senior unsecured notes | 0 | (200,000) |
Repurchase/redemption premiums paid on senior unsecured notes | 0 | (10,895) |
Debt issuance costs paid | 0 | (5,342) |
Purchases of treasury stock | (258,545) | (65,035) |
Proceeds from exercise of share-based compensation awards | 400 | 307 |
Dividends paid | (29,897) | (27,400) |
Net cash flow used in financing activities | (90,042) | (128,365) |
Effect of exchange rates on cash | 621 | 5,450 |
Change in cash and cash equivalents | (57,398) | 3,456 |
Cash and cash equivalents at beginning of the period | 114,423 | 89,955 |
Cash and cash equivalents at end of the period | $ 57,025 | $ 93,411 |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 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. These unaudited consolidated financial statements are condensed and do not include all disclosures and footnotes required by generally accepted accounting principles (“GAAP”) 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 September 30, 2018 and 2017 , and for the three month and nine month periods ended September 30, 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 periods ended September 30, 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 and nine month periods ended September 30, 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 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. In July 2018, the Financial Accounting Standards Board issued ASU No. 2018-10, “Codification Improvements to Topic 842, Leases” (“ASU 2018-10”) which updates narrow aspects of the guidance issued in ASU 2016-02. In July 2018, the Financial Accounting Standards Board issued ASU No. 2018-11, “Leases (Topic 842) Targeted Improvements” (“ASU 2018-11”) which provides an optional transition method that allows entities to initially apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption without restating prior periods. ASU 2016-02, ASU 2018-10 and ASU 2018-11 are effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods, with early adoption permitted. The Company is currently assessing the potential impact of ASU 2016-02, ASU 2018-10 and ASU 2018-11 on its consolidated financial statements, though the adoption will result in a material increase in the assets and liabilities reflected on its consolidated balance sheets. 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. In June 2018, the Financial Accounting Standards Board issued ASU No. 2018-07, “Compensation-Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 simplifies the accounting for nonemployee share-based payment transactions. The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. ASU 2018-07 is effective for public entities for fiscal years beginning after December 15, 2018, with early adoption permitted, but no earlier than a company’s adoption of ASC 606. The Company does not expect ASU 2018-07 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In July 2018, the Financial Accounting Standards Board issued ASU No. 2018-09, “Codification Improvements” (“ASU 2018-09”). ASU 2018-09 does not prescribe any new accounting guidance, but instead makes minor improvements and clarifications of several different Financial Accounting Standards Board Accounting Standards Codification areas based on comments and suggestions made by various stakeholders. Certain updates are applicable immediately while others provide for a transition period to adopt in fiscal years beginning after December 15, 2018. The Company does not expect ASU 2018-09 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In August 2018, the Financial Accounting Standards Board issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”). ASU 2018-13 modifies the disclosure requirements on fair value measurements. ASU 2018-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted for any removed or modified disclosures. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The Company does not expect ASU 2018-13 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 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 Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Numerator: Net income $ 33,325 $ 28,274 $ 105,131 $ 76,158 Denominator: Weighted-average common shares for calculating basic earnings per share 43,981 47,628 45,107 48,090 Effect of dilutive securities: Stock options and nonvested common stock awards 135 40 97 27 Weighted-average common shares for calculating diluted earnings per share 44,116 47,668 45,204 48,117 Earnings per share: Basic $ 0.76 $ 0.59 $ 2.33 $ 1.58 Diluted $ 0.76 $ 0.59 $ 2.33 $ 1.58 |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Consistent with the Company’s strategy to continue its expansion of pawn stores in selected markets, during the nine months ended September 30, 2018 , the Company acquired 342 pawn stores in Mexico in four separate transactions and 18 pawn stores located in the U.S. in seven separate transactions. The all-cash aggregate purchase price for these acquisitions was $105.0 million , net of cash acquired and subject to future post-closing adjustments. The purchases were composed of $88.4 million in cash paid during the nine months ended September 30, 2018 and remaining payables to the sellers of approximately $16.6 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. The estimated fair value of the assets acquired and liabilities assumed are preliminary, as the Company is gathering information to finalize the valuation of these assets and liabilities. The preliminary allocation of the aggregate purchase price of the Company’s individually immaterial acquisitions during the nine months ended September 30, 2018 is as follows (in thousands): Pawn loans $ 18,714 Pawn loan fees receivable 1,866 Inventory 9,534 Other current assets 863 Property and equipment 3,717 Goodwill (1) 70,957 Intangible assets (2) 871 Other non-current assets 168 Current liabilities (1,657 ) Aggregate purchase price $ 105,033 (1) Goodwill associated with the U.S. operations segment and the Latin America operations segment was $5.2 million and $65.8 million , respectively. Substantially all of the goodwill is expected to be deductible for respective U.S. and Mexico income tax purposes. (2) Intangible assets primarily consist of customer relationships, which are generally amortized over 5 years . The results of operations for the acquired stores have been consolidated since the respective acquisition dates. During the nine months ended September 30, 2018 , revenue from the acquired stores was $21.0 million and the net loss from the combined acquisitions since the acquisition dates (including approximately $3.6 million of transaction and integration costs) was approximately $1.9 million . Historical pre-acquisition financial statements of the four separate Mexico acquisitions were created in local country GAAP and the Company did not obtain pre-acquisition financial statements prepared in accordance with U.S. GAAP. As a result and due to the insignificance of these acquisitions, it is impractical for the Company to adequately present supplemental pro forma information. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 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): September 30, December 31, 2018 2017 2017 5.375% senior unsecured notes due 2024 (1) $ 295,722 $ 294,961 $ 295,243 Revolving unsecured credit facility, maturing 2022 305,000 140,000 107,000 Total long-term debt $ 600,722 $ 434,961 $ 402,243 (1) As of September 30, 2018 , September 30, 2017 and December 31, 2017 , deferred debt issuance costs of $4.3 million , $5.0 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. Senior Unsecured Notes On May 30, 2017, the Company issued $300.0 million of 5.375% senior unsecured 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 revolving unsecured 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. The Company used the proceeds from the offering of the Notes to repurchase, or otherwise redeem, its previously outstanding $200.0 million , 6.75% senior unsecured notes due 2021 (the “2021 Notes”). As a result, during the nine months ended September 30, 2017 , the Company recognized a $14.1 million loss on extinguishment of debt related to the repurchase or redemption of the 2021 Notes. Revolving Unsecured Credit Facility At September 30, 2018 , the Company maintained an unsecured line of credit with a group of U.S. based commercial lenders (the “Credit Facility”) in the amount of $400.0 million , which matures on September 2, 2022 . At September 30, 2018 , the Company had $305.0 million in outstanding borrowings and $3.2 million in outstanding letters of credit under the Credit Facility, leaving $91.8 million available for future borrowings. The 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 Credit Facility commitment. The weighted-average interest rate on amounts outstanding under the Credit Facility at September 30, 2018 was 4.66% based on 1 week LIBOR. Under the terms of the Credit Facility, the Company is required to maintain certain financial ratios and comply with certain financial covenants. The 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 Credit Facility as of September 30, 2018 . During the nine months ended September 30, 2018 , the Company received net proceeds of $198.0 million from borrowings pursuant to the Credit Facility. On October 4, 2018, the Company amended and extended the Credit Facility. The total lender commitment under the amended facility increased from $400.0 million to $425.0 million and the term was extended to October 4, 2023. Certain financial covenants in the facility were amended, including an increase in the permitted consolidated leverage ratio from 2.75 to 3.0 times EBITDA adjusted for certain items as defined in the Credit Facility and an increase in the permitted domestic leverage ratio from 3.5 to 4.0 times domestic EBITDA adjusted for certain items as defined in the Credit Facility. The Credit Facility remains unsecured and continues to bear interest, at the Company’s option, at either (i) the prevailing 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% . |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 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 September 30, 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 September 30, 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 September 30, September 30, Fair Value Measurements Using 2018 2018 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 57,025 $ 57,025 $ 57,025 $ — $ — Fees and service charges receivable 49,141 49,141 — — 49,141 Pawn loans 387,733 387,733 — — 387,733 Consumer loans, net 17,804 17,804 — — 17,804 $ 511,703 $ 511,703 $ 57,025 $ — $ 454,678 Financial liabilities: Revolving unsecured credit facility $ 305,000 $ 305,000 $ — $ 305,000 $ — Senior unsecured notes (outstanding principal) 300,000 300,000 — 300,000 — $ 605,000 $ 605,000 $ — $ 605,000 $ — Carrying Value Estimated Fair Value September 30, September 30, Fair Value Measurements Using 2017 2017 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 93,411 $ 93,411 $ 93,411 $ — $ — Fees and service charges receivable 45,134 45,134 — — 45,134 Pawn loans 371,367 371,367 — — 371,367 Consumer loans, net 24,515 24,515 — — 24,515 $ 534,427 $ 534,427 $ 93,411 $ — $ 441,016 Financial liabilities: Revolving unsecured credit facility $ 140,000 $ 140,000 $ — $ 140,000 $ — Senior unsecured notes (outstanding principal) 300,000 314,000 — 314,000 — $ 440,000 $ 454,000 $ — $ 454,000 $ — 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 $ — $ — Fees and service charges receivable 42,736 42,736 — — 42,736 Pawn loans 344,748 344,748 — — 344,748 Consumer loans, net 23,522 23,522 — — 23,522 $ 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. Consumer loans, net 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 revolving unsecured credit facility approximates fair value as of September 30, 2018 , 2017 and December 31, 2017 . The fair value of the revolving unsecured credit facility is estimated based on market values for debt issuances with similar characteristics or rates currently available for debt with similar terms. In addition, the revolving unsecured credit facility has a variable interest rate based on a fixed spread over LIBOR and reprices with any changes in LIBOR. The fair value of the senior unsecured notes is estimated based on quoted prices in markets that are not active. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 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 consolidated effective tax rate for the nine months ended September 30, 2018 was 26.0% compared to 33.9% for the nine months ended September 30, 2017 . The decrease in the effective tax rate for the nine months ended September 30, 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% , 30% and 37% in Mexico, Guatemala, El Salvador and Colombia, 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 the fourth quarter of 2017. As of September 30, 2018 , no material 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 | 9 Months Ended |
Sep. 30, 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. Effective June 30, 2018, the Company no longer offers an unsecured consumer loan product in Latin America. The following tables present reportable segment information for the three and nine month periods ended September 30, 2018 and 2017 (in thousands): Three Months Ended September 30, 2018 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 162,001 $ 94,416 $ — $ 256,417 Pawn loan fees 93,344 41,269 — 134,613 Wholesale scrap jewelry sales 18,804 5,846 — 24,650 Consumer loan and credit services fees 14,082 116 — 14,198 Total revenue 288,231 141,647 — 429,878 Cost of revenue: Cost of retail merchandise sold 102,370 60,917 — 163,287 Cost of wholesale scrap jewelry sold 17,595 6,264 — 23,859 Consumer loan and credit services loss provision 5,420 54 — 5,474 Total cost of revenue 125,385 67,235 — 192,620 Net revenue 162,846 74,412 — 237,258 Expenses and other income: Store operating expenses 102,955 38,800 — 141,755 Administrative expenses — — 29,977 29,977 Depreciation and amortization 5,285 2,915 2,650 10,850 Interest expense — — 7,866 7,866 Interest income — — (495 ) (495 ) Merger and other acquisition expenses — — 3,222 3,222 Total expenses and other income 108,240 41,715 43,220 193,175 Income (loss) before income taxes $ 54,606 $ 32,697 $ (43,220 ) $ 44,083 Three Months Ended September 30, 2017 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 160,598 $ 85,736 $ — $ 246,334 Pawn loan fees 95,266 37,279 — 132,545 Wholesale scrap jewelry sales 32,397 5,131 — 37,528 Consumer loan and credit services fees 18,525 480 — 19,005 Total revenue 306,786 128,626 — 435,412 Cost of revenue: Cost of retail merchandise sold 107,561 53,789 — 161,350 Cost of wholesale scrap jewelry sold 31,518 5,313 — 36,831 Consumer loan and credit services loss provision 6,068 117 — 6,185 Total cost of revenue 145,147 59,219 — 204,366 Net revenue 161,639 69,407 — 231,046 Expenses and other income: Store operating expenses 104,555 34,411 — 138,966 Administrative expenses — — 29,999 29,999 Depreciation and amortization 5,919 2,704 5,249 13,872 Interest expense — — 6,129 6,129 Interest income — — (418 ) (418 ) Merger and other acquisition expenses — — 911 911 Loss on extinguishment of debt — — 20 20 Total expenses and other income 110,474 37,115 41,890 189,479 Income (loss) before income taxes $ 51,165 $ 32,292 $ (41,890 ) $ 41,567 Nine Months Ended September 30, 2018 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 514,494 $ 267,506 $ — $ 782,000 Pawn loan fees 277,411 110,007 — 387,418 Wholesale scrap jewelry sales 70,394 16,456 — 86,850 Consumer loan and credit services fees 42,522 860 — 43,382 Total revenue 904,821 394,829 — 1,299,650 Cost of revenue: Cost of retail merchandise sold 328,258 173,100 — 501,358 Cost of wholesale scrap jewelry sold 64,203 16,227 — 80,430 Consumer loan and credit services loss provision 12,874 221 — 13,095 Total cost of revenue 405,335 189,548 — 594,883 Net revenue 499,486 205,281 — 704,767 Expenses and other income: Store operating expenses 310,963 106,936 — 417,899 Administrative expenses — — 87,699 87,699 Depreciation and amortization 15,877 8,364 8,844 33,085 Interest expense — — 20,593 20,593 Interest income — — (2,216 ) (2,216 ) Merger and other acquisition expenses — — 5,574 5,574 Total expenses and other income 326,840 115,300 120,494 562,634 Income (loss) before income taxes $ 172,646 $ 89,981 $ (120,494 ) $ 142,133 Nine Months Ended September 30, 2017 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 519,116 $ 231,034 $ — $ 750,150 Pawn loan fees 287,338 96,090 — 383,428 Wholesale scrap jewelry sales 91,430 15,855 — 107,285 Consumer loan and credit services fees 57,425 1,329 — 58,754 Total revenue 955,309 344,308 — 1,299,617 Cost of revenue: Cost of retail merchandise sold 337,789 145,669 — 483,458 Cost of wholesale scrap jewelry sold 87,600 14,770 — 102,370 Consumer loan and credit services loss provision 15,115 304 — 15,419 Total cost of revenue 440,504 160,743 — 601,247 Net revenue 514,805 183,565 — 698,370 Expenses and other income: Store operating expenses 318,044 94,736 — 412,780 Administrative expenses — — 93,542 93,542 Depreciation and amortization 18,759 7,723 16,322 42,804 Interest expense — — 17,827 17,827 Interest income — — (1,138 ) (1,138 ) Merger and other acquisition expenses — — 3,164 3,164 Loss on extinguishment of debt — — 14,114 14,114 Total expenses and other income 336,803 102,459 143,831 583,093 Income (loss) before income taxes $ 178,002 $ 81,106 $ (143,831 ) $ 115,277 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
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. These unaudited consolidated financial statements are condensed and do not include all disclosures and footnotes required by generally accepted accounting principles (“GAAP”) 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 September 30, 2018 and 2017 , and for the three month and nine month periods ended September 30, 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 periods ended September 30, 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 and nine month periods ended September 30, 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 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. In July 2018, the Financial Accounting Standards Board issued ASU No. 2018-10, “Codification Improvements to Topic 842, Leases” (“ASU 2018-10”) which updates narrow aspects of the guidance issued in ASU 2016-02. In July 2018, the Financial Accounting Standards Board issued ASU No. 2018-11, “Leases (Topic 842) Targeted Improvements” (“ASU 2018-11”) which provides an optional transition method that allows entities to initially apply the new standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption without restating prior periods. ASU 2016-02, ASU 2018-10 and ASU 2018-11 are effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods, with early adoption permitted. The Company is currently assessing the potential impact of ASU 2016-02, ASU 2018-10 and ASU 2018-11 on its consolidated financial statements, though the adoption will result in a material increase in the assets and liabilities reflected on its consolidated balance sheets. 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. In June 2018, the Financial Accounting Standards Board issued ASU No. 2018-07, “Compensation-Stock Compensation (Topic 718) - Improvements to Nonemployee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 simplifies the accounting for nonemployee share-based payment transactions. The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. ASU 2018-07 is effective for public entities for fiscal years beginning after December 15, 2018, with early adoption permitted, but no earlier than a company’s adoption of ASC 606. The Company does not expect ASU 2018-07 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In July 2018, the Financial Accounting Standards Board issued ASU No. 2018-09, “Codification Improvements” (“ASU 2018-09”). ASU 2018-09 does not prescribe any new accounting guidance, but instead makes minor improvements and clarifications of several different Financial Accounting Standards Board Accounting Standards Codification areas based on comments and suggestions made by various stakeholders. Certain updates are applicable immediately while others provide for a transition period to adopt in fiscal years beginning after December 15, 2018. The Company does not expect ASU 2018-09 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. In August 2018, the Financial Accounting Standards Board issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”). ASU 2018-13 modifies the disclosure requirements on fair value measurements. ASU 2018-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted for any removed or modified disclosures. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The Company does not expect ASU 2018-13 to have a material effect on the Company’s current financial position, results of operations or financial statement disclosures. |
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) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of 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 Nine Months Ended September 30, September 30, 2018 2017 2018 2017 Numerator: Net income $ 33,325 $ 28,274 $ 105,131 $ 76,158 Denominator: Weighted-average common shares for calculating basic earnings per share 43,981 47,628 45,107 48,090 Effect of dilutive securities: Stock options and nonvested common stock awards 135 40 97 27 Weighted-average common shares for calculating diluted earnings per share 44,116 47,668 45,204 48,117 Earnings per share: Basic $ 0.76 $ 0.59 $ 2.33 $ 1.58 Diluted $ 0.76 $ 0.59 $ 2.33 $ 1.58 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of Preliminary Allocations of Purchase Price | The estimated fair value of the assets acquired and liabilities assumed are preliminary, as the Company is gathering information to finalize the valuation of these assets and liabilities. The preliminary allocation of the aggregate purchase price of the Company’s individually immaterial acquisitions during the nine months ended September 30, 2018 is as follows (in thousands): Pawn loans $ 18,714 Pawn loan fees receivable 1,866 Inventory 9,534 Other current assets 863 Property and equipment 3,717 Goodwill (1) 70,957 Intangible assets (2) 871 Other non-current assets 168 Current liabilities (1,657 ) Aggregate purchase price $ 105,033 (1) Goodwill associated with the U.S. operations segment and the Latin America operations segment was $5.2 million and $65.8 million , respectively. Substantially all of the goodwill is expected to be deductible for respective U.S. and Mexico income tax purposes. (2) Intangible assets primarily consist of customer relationships, which are generally amortized over |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 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): September 30, December 31, 2018 2017 2017 5.375% senior unsecured notes due 2024 (1) $ 295,722 $ 294,961 $ 295,243 Revolving unsecured credit facility, maturing 2022 305,000 140,000 107,000 Total long-term debt $ 600,722 $ 434,961 $ 402,243 (1) As of September 30, 2018 , September 30, 2017 and December 31, 2017 , deferred debt issuance costs of $4.3 million , $5.0 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. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value by Balance Sheet Grouping | The Company’s financial assets and liabilities as of September 30, 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 September 30, September 30, Fair Value Measurements Using 2018 2018 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 57,025 $ 57,025 $ 57,025 $ — $ — Fees and service charges receivable 49,141 49,141 — — 49,141 Pawn loans 387,733 387,733 — — 387,733 Consumer loans, net 17,804 17,804 — — 17,804 $ 511,703 $ 511,703 $ 57,025 $ — $ 454,678 Financial liabilities: Revolving unsecured credit facility $ 305,000 $ 305,000 $ — $ 305,000 $ — Senior unsecured notes (outstanding principal) 300,000 300,000 — 300,000 — $ 605,000 $ 605,000 $ — $ 605,000 $ — Carrying Value Estimated Fair Value September 30, September 30, Fair Value Measurements Using 2017 2017 Level 1 Level 2 Level 3 Financial assets: Cash and cash equivalents $ 93,411 $ 93,411 $ 93,411 $ — $ — Fees and service charges receivable 45,134 45,134 — — 45,134 Pawn loans 371,367 371,367 — — 371,367 Consumer loans, net 24,515 24,515 — — 24,515 $ 534,427 $ 534,427 $ 93,411 $ — $ 441,016 Financial liabilities: Revolving unsecured credit facility $ 140,000 $ 140,000 $ — $ 140,000 $ — Senior unsecured notes (outstanding principal) 300,000 314,000 — 314,000 — $ 440,000 $ 454,000 $ — $ 454,000 $ — 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 $ — $ — Fees and service charges receivable 42,736 42,736 — — 42,736 Pawn loans 344,748 344,748 — — 344,748 Consumer loans, net 23,522 23,522 — — 23,522 $ 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) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following tables present reportable segment information for the three and nine month periods ended September 30, 2018 and 2017 (in thousands): Three Months Ended September 30, 2018 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 162,001 $ 94,416 $ — $ 256,417 Pawn loan fees 93,344 41,269 — 134,613 Wholesale scrap jewelry sales 18,804 5,846 — 24,650 Consumer loan and credit services fees 14,082 116 — 14,198 Total revenue 288,231 141,647 — 429,878 Cost of revenue: Cost of retail merchandise sold 102,370 60,917 — 163,287 Cost of wholesale scrap jewelry sold 17,595 6,264 — 23,859 Consumer loan and credit services loss provision 5,420 54 — 5,474 Total cost of revenue 125,385 67,235 — 192,620 Net revenue 162,846 74,412 — 237,258 Expenses and other income: Store operating expenses 102,955 38,800 — 141,755 Administrative expenses — — 29,977 29,977 Depreciation and amortization 5,285 2,915 2,650 10,850 Interest expense — — 7,866 7,866 Interest income — — (495 ) (495 ) Merger and other acquisition expenses — — 3,222 3,222 Total expenses and other income 108,240 41,715 43,220 193,175 Income (loss) before income taxes $ 54,606 $ 32,697 $ (43,220 ) $ 44,083 Three Months Ended September 30, 2017 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 160,598 $ 85,736 $ — $ 246,334 Pawn loan fees 95,266 37,279 — 132,545 Wholesale scrap jewelry sales 32,397 5,131 — 37,528 Consumer loan and credit services fees 18,525 480 — 19,005 Total revenue 306,786 128,626 — 435,412 Cost of revenue: Cost of retail merchandise sold 107,561 53,789 — 161,350 Cost of wholesale scrap jewelry sold 31,518 5,313 — 36,831 Consumer loan and credit services loss provision 6,068 117 — 6,185 Total cost of revenue 145,147 59,219 — 204,366 Net revenue 161,639 69,407 — 231,046 Expenses and other income: Store operating expenses 104,555 34,411 — 138,966 Administrative expenses — — 29,999 29,999 Depreciation and amortization 5,919 2,704 5,249 13,872 Interest expense — — 6,129 6,129 Interest income — — (418 ) (418 ) Merger and other acquisition expenses — — 911 911 Loss on extinguishment of debt — — 20 20 Total expenses and other income 110,474 37,115 41,890 189,479 Income (loss) before income taxes $ 51,165 $ 32,292 $ (41,890 ) $ 41,567 Nine Months Ended September 30, 2018 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 514,494 $ 267,506 $ — $ 782,000 Pawn loan fees 277,411 110,007 — 387,418 Wholesale scrap jewelry sales 70,394 16,456 — 86,850 Consumer loan and credit services fees 42,522 860 — 43,382 Total revenue 904,821 394,829 — 1,299,650 Cost of revenue: Cost of retail merchandise sold 328,258 173,100 — 501,358 Cost of wholesale scrap jewelry sold 64,203 16,227 — 80,430 Consumer loan and credit services loss provision 12,874 221 — 13,095 Total cost of revenue 405,335 189,548 — 594,883 Net revenue 499,486 205,281 — 704,767 Expenses and other income: Store operating expenses 310,963 106,936 — 417,899 Administrative expenses — — 87,699 87,699 Depreciation and amortization 15,877 8,364 8,844 33,085 Interest expense — — 20,593 20,593 Interest income — — (2,216 ) (2,216 ) Merger and other acquisition expenses — — 5,574 5,574 Total expenses and other income 326,840 115,300 120,494 562,634 Income (loss) before income taxes $ 172,646 $ 89,981 $ (120,494 ) $ 142,133 Nine Months Ended September 30, 2017 U.S. Operations Latin America Operations Corporate Consolidated Revenue: Retail merchandise sales $ 519,116 $ 231,034 $ — $ 750,150 Pawn loan fees 287,338 96,090 — 383,428 Wholesale scrap jewelry sales 91,430 15,855 — 107,285 Consumer loan and credit services fees 57,425 1,329 — 58,754 Total revenue 955,309 344,308 — 1,299,617 Cost of revenue: Cost of retail merchandise sold 337,789 145,669 — 483,458 Cost of wholesale scrap jewelry sold 87,600 14,770 — 102,370 Consumer loan and credit services loss provision 15,115 304 — 15,419 Total cost of revenue 440,504 160,743 — 601,247 Net revenue 514,805 183,565 — 698,370 Expenses and other income: Store operating expenses 318,044 94,736 — 412,780 Administrative expenses — — 93,542 93,542 Depreciation and amortization 18,759 7,723 16,322 42,804 Interest expense — — 17,827 17,827 Interest income — — (1,138 ) (1,138 ) Merger and other acquisition expenses — — 3,164 3,164 Loss on extinguishment of debt — — 14,114 14,114 Total expenses and other income 336,803 102,459 143,831 583,093 Income (loss) before income taxes $ 178,002 $ 81,106 $ (143,831 ) $ 115,277 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 33,325 | $ 28,274 | $ 105,131 | $ 76,158 |
Denominator: | ||||
Weighted-average common shares for calculating basic earnings per share (shares) | 43,981 | 47,628 | 45,107 | 48,090 |
Stock options and nonvested stock awards (shares) | 135 | 40 | 97 | 27 |
Weighted-average common shares for calculating diluted earnings per share (shares) | 44,116 | 47,668 | 45,204 | 48,117 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.76 | $ 0.59 | $ 2.33 | $ 1.58 |
Diluted (in dollars per share) | $ 0.76 | $ 0.59 | $ 2.33 | $ 1.58 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2018USD ($)store | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Entity Location [Line Items] | |||
Goodwill | $ 906,322 | $ 834,883 | $ 831,145 |
Purchase price | 105,000 | ||
Payments to Acquire Businesses, Net of Cash Acquired | 88,387 | $ 1,141 | |
Business Combination, Consideration Transferred, Liabilities Incurred | 16,600 | ||
Revenue since acquisition | 21,000 | ||
Transaction and integration costs | 3,600 | ||
Net earnings since acquisition | 1,900 | ||
Latin America Acquisition | |||
Entity Location [Line Items] | |||
Goodwill | $ 65,785 | ||
Number of stores acquired | store | 342 | ||
Number of acquisitions | store | 4 | ||
U.S. Acquisition | |||
Entity Location [Line Items] | |||
Goodwill | $ 5,172 | ||
Number of stores acquired | store | 18 | ||
Number of acquisitions | store | 7 |
Acquisitions - Purchase Price A
Acquisitions - Purchase Price Allocation (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | |
Business Acquisition [Line Items] | |||
Goodwill | $ 906,322 | $ 831,145 | $ 834,883 |
Useful life | 5 years | ||
Business Acquisition | |||
Business Acquisition [Line Items] | |||
Pawn loans | $ 18,714 | ||
Pawn loan fees receivable | 1,866 | ||
Inventory | 9,534 | ||
Other current assets | 863 | ||
Property and equipment | 3,717 | ||
Goodwill | 70,957 | ||
Intangible assets | 871 | ||
Other non-current assets | 168 | ||
Current liabilities | (1,657) | ||
Aggregate purchase price | 105,033 | ||
Latin America Acquisition | |||
Business Acquisition [Line Items] | |||
Goodwill | 65,785 | ||
U.S. Acquisition | |||
Business Acquisition [Line Items] | |||
Goodwill | $ 5,172 |
Long-Term Debt - Summary (Detai
Long-Term Debt - Summary (Details) | Oct. 04, 2018USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | May 30, 2017USD ($) |
Debt Instrument [Line Items] | |||||||
Total long-term debt | $ 600,722,000 | $ 434,961,000 | $ 600,722,000 | $ 434,961,000 | $ 402,243,000 | ||
Deferred finance costs, net | $ 4,300,000 | 5,000,000 | $ 4,300,000 | 5,000,000 | 4,800,000 | ||
Debt ratio | 2.25 | 2.25 | |||||
Loss on extinguishment of debt | $ 0 | 20,000 | $ 0 | 14,114,000 | |||
Line of Credit Facility, Leverage Ratio | 2.75 | ||||||
Senior notes 2024 | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate (percent) | 5.375% | ||||||
Face amount | $ 300,000,000 | ||||||
Senior notes 2021 | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate (percent) | 6.75% | ||||||
Face amount | $ 200,000,000 | ||||||
Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Amount outstanding | 305,000,000 | 140,000,000 | $ 305,000,000 | 140,000,000 | 107,000,000 | ||
Maximum borrowing capacity | 400,000,000 | 400,000,000 | |||||
Letters of credit outstanding, amount | 3,200,000 | 3,200,000 | |||||
Remaining borrowing capacity | $ 91,800,000 | $ 91,800,000 | |||||
Unused capacity, commitment fee (percent) | 0.50% | ||||||
Interest rate at end of period (percent) | 4.66% | 4.66% | |||||
Net proceeds | $ 198,000,000 | ||||||
Line of Credit | 30-day LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (percent) | 2.50% | ||||||
Line of Credit | Prime Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate (percent) | 1.50% | ||||||
Line of Credit | Minimum | 30-day LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate (percent) | 0.00% | 0.00% | |||||
Senior notes 2024 | |||||||
Debt Instrument [Line Items] | |||||||
Total long-term debt | $ 295,722,000 | $ 294,961,000 | $ 295,722,000 | $ 294,961,000 | $ 295,243,000 | ||
Stated interest rate (percent) | 5.375% | 5.375% | |||||
Subsequent Event | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Leverage Ratio | 3 | ||||||
Subsequent Event | Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 425,000,000 | ||||||
Geographic Distribution, Domestic | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Leverage Ratio | 3.5 | ||||||
Geographic Distribution, Domestic | Subsequent Event | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Leverage Ratio | 4 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Financial Assets and Liabilities Not Measured at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 |
Carrying Value | |||
Financial assets: | |||
Cash and cash equivalents | $ 57,025 | $ 114,423 | $ 93,411 |
Fees and service charges receivable | 49,141 | 42,736 | 45,134 |
Total assets | 511,703 | 525,429 | 534,427 |
Financial liabilities: | |||
Total liabilities | 605,000 | 407,000 | 440,000 |
Carrying Value | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 305,000 | 107,000 | 140,000 |
Carrying Value | Senior unsecured notes (outstanding principal) | |||
Financial liabilities: | |||
Debt | 300,000 | 300,000 | 300,000 |
Carrying Value | Pawn loans | |||
Financial assets: | |||
Loans receivable | 387,733 | 344,748 | 371,367 |
Carrying Value | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 17,804 | 23,522 | 24,515 |
Estimated Fair Value | |||
Financial assets: | |||
Cash and cash equivalents | 57,025 | 114,423 | 93,411 |
Fees and service charges receivable | 49,141 | 42,736 | 45,134 |
Total assets | 511,703 | 525,429 | 534,427 |
Financial liabilities: | |||
Total liabilities | 605,000 | 421,000 | 454,000 |
Estimated Fair Value | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 305,000 | 107,000 | 140,000 |
Estimated Fair Value | Senior unsecured notes (outstanding principal) | |||
Financial liabilities: | |||
Debt | 300,000 | 314,000 | 314,000 |
Estimated Fair Value | Pawn loans | |||
Financial assets: | |||
Loans receivable | 387,733 | 344,748 | 371,367 |
Estimated Fair Value | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | 17,804 | 23,522 | 24,515 |
Estimated Fair Value | Level 1 | |||
Financial assets: | |||
Cash and cash equivalents | 57,025 | 114,423 | 93,411 |
Fees and service charges receivable | 0 | 0 | 0 |
Total assets | 57,025 | 114,423 | 93,411 |
Financial liabilities: | |||
Total liabilities | 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 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 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 | 605,000 | 421,000 | 454,000 |
Estimated Fair Value | Level 2 | Revolving unsecured credit facility | |||
Financial liabilities: | |||
Debt | 305,000 | 107,000 | 140,000 |
Estimated Fair Value | Level 2 | Senior unsecured notes (outstanding principal) | |||
Financial liabilities: | |||
Debt | 300,000 | 314,000 | 314,000 |
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 3 | |||
Financial assets: | |||
Cash and cash equivalents | 0 | 0 | 0 |
Fees and service charges receivable | 49,141 | 42,736 | 45,134 |
Total assets | 454,678 | 411,006 | 441,016 |
Financial liabilities: | |||
Total liabilities | 0 | 0 | 0 |
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 |
Estimated Fair Value | Level 3 | Pawn loans | |||
Financial assets: | |||
Loans receivable | 387,733 | 344,748 | 371,367 |
Estimated Fair Value | Level 3 | Consumer loans, net | |||
Financial assets: | |||
Loans receivable | $ 17,804 | $ 23,522 | $ 24,515 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | Dec. 22, 2017 | Dec. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
Entity Location [Line Items] | ||||
Income tax benefit as a result of the Tax Act | $ 27.3 | |||
UNITED STATES | ||||
Entity Location [Line Items] | ||||
Effective tax rate (percent) | 35.00% | 26.00% | 33.90% | |
MEXICO | ||||
Entity Location [Line Items] | ||||
Effective tax rate (percent) | 30.00% | |||
GUATEMALA | ||||
Entity Location [Line Items] | ||||
Effective tax rate (percent) | 25.00% | |||
EL SALVADOR | ||||
Entity Location [Line Items] | ||||
Effective tax rate (percent) | 30.00% | |||
COLOMBIA | ||||
Entity Location [Line Items] | ||||
Effective tax rate (percent) | 37.00% |
Segment Information - Summary (
Segment Information - Summary (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)segment | Sep. 30, 2017USD ($) | |
Revenue: | ||||
Retail merchandise sales | $ 256,417 | $ 246,334 | $ 782,000 | $ 750,150 |
Number of reportable segments | segment | 2 | |||
Pawn loan fees | 134,613 | 132,545 | $ 387,418 | 383,428 |
Wholesale scrap jewelry sales | 24,650 | 37,528 | 86,850 | 107,285 |
Consumer loan and credit services fees | 14,198 | 19,005 | 43,382 | 58,754 |
Total revenue | 429,878 | 435,412 | 1,299,650 | 1,299,617 |
Cost of revenue: | ||||
Cost of retail merchandise sold | 163,287 | 161,350 | 501,358 | 483,458 |
Cost of wholesale scrap jewelry sold | 23,859 | 36,831 | 80,430 | 102,370 |
Consumer loan and credit services loss provision | 5,474 | 6,185 | 13,095 | 15,419 |
Total cost of revenue | 192,620 | 204,366 | 594,883 | 601,247 |
Net revenue | 237,258 | 231,046 | 704,767 | 698,370 |
Expenses and other income: | ||||
Store operating expenses | 141,755 | 138,966 | 417,899 | 412,780 |
Administrative expenses | 29,977 | 29,999 | 87,699 | 93,542 |
Depreciation and amortization | 10,850 | 13,872 | 33,085 | 42,804 |
Interest expense | 7,866 | 6,129 | 20,593 | 17,827 |
Interest income | (495) | (418) | (2,216) | (1,138) |
Merger and other acquisition expenses | 3,222 | 911 | 5,574 | 3,164 |
Loss on extinguishment of debt | 0 | 20 | 0 | 14,114 |
Total expenses and other income | 193,175 | 189,479 | 562,634 | 583,093 |
Income (loss) before income taxes | 44,083 | 41,567 | 142,133 | 115,277 |
U.S. Operations | ||||
Revenue: | ||||
Retail merchandise sales | 162,001 | 160,598 | 514,494 | 519,116 |
Pawn loan fees | 93,344 | 95,266 | 277,411 | 287,338 |
Wholesale scrap jewelry sales | 18,804 | 32,397 | 70,394 | 91,430 |
Consumer loan and credit services fees | 14,082 | 18,525 | 42,522 | 57,425 |
Total revenue | 288,231 | 306,786 | 904,821 | 955,309 |
Cost of revenue: | ||||
Cost of retail merchandise sold | 102,370 | 107,561 | 328,258 | 337,789 |
Cost of wholesale scrap jewelry sold | 17,595 | 31,518 | 64,203 | 87,600 |
Consumer loan and credit services loss provision | 5,420 | 6,068 | 12,874 | 15,115 |
Total cost of revenue | 125,385 | 145,147 | 405,335 | 440,504 |
Net revenue | 162,846 | 161,639 | 499,486 | 514,805 |
Expenses and other income: | ||||
Store operating expenses | 102,955 | 104,555 | 310,963 | 318,044 |
Administrative expenses | 0 | 0 | 0 | 0 |
Depreciation and amortization | 5,285 | 5,919 | 15,877 | 18,759 |
Interest expense | 0 | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 | 0 |
Merger and other acquisition expenses | 0 | 0 | 0 | 0 |
Loss on extinguishment of debt | 0 | 0 | ||
Total expenses and other income | 108,240 | 110,474 | 326,840 | 336,803 |
Income (loss) before income taxes | 54,606 | 51,165 | 172,646 | 178,002 |
Latin America Operations | ||||
Revenue: | ||||
Retail merchandise sales | 94,416 | 85,736 | 267,506 | 231,034 |
Pawn loan fees | 41,269 | 37,279 | 110,007 | 96,090 |
Wholesale scrap jewelry sales | 5,846 | 5,131 | 16,456 | 15,855 |
Consumer loan and credit services fees | 116 | 480 | 860 | 1,329 |
Total revenue | 141,647 | 128,626 | 394,829 | 344,308 |
Cost of revenue: | ||||
Cost of retail merchandise sold | 60,917 | 53,789 | 173,100 | 145,669 |
Cost of wholesale scrap jewelry sold | 6,264 | 5,313 | 16,227 | 14,770 |
Consumer loan and credit services loss provision | 54 | 117 | 221 | 304 |
Total cost of revenue | 67,235 | 59,219 | 189,548 | 160,743 |
Net revenue | 74,412 | 69,407 | 205,281 | 183,565 |
Expenses and other income: | ||||
Store operating expenses | 38,800 | 34,411 | 106,936 | 94,736 |
Administrative expenses | 0 | 0 | 0 | 0 |
Depreciation and amortization | 2,915 | 2,704 | 8,364 | 7,723 |
Interest expense | 0 | 0 | 0 | 0 |
Interest income | 0 | 0 | 0 | 0 |
Merger and other acquisition expenses | 0 | 0 | 0 | 0 |
Loss on extinguishment of debt | 0 | 0 | ||
Total expenses and other income | 41,715 | 37,115 | 115,300 | 102,459 |
Income (loss) before income taxes | 32,697 | 32,292 | 89,981 | 81,106 |
Corporate | ||||
Revenue: | ||||
Retail merchandise sales | 0 | 0 | 0 | 0 |
Pawn loan fees | 0 | 0 | 0 | 0 |
Wholesale scrap jewelry sales | 0 | 0 | 0 | 0 |
Consumer loan and credit services fees | 0 | 0 | 0 | 0 |
Total revenue | 0 | 0 | 0 | 0 |
Cost of revenue: | ||||
Cost of retail merchandise sold | 0 | 0 | 0 | 0 |
Cost of wholesale scrap jewelry sold | 0 | 0 | 0 | 0 |
Consumer loan and credit services loss provision | 0 | 0 | 0 | 0 |
Total cost of revenue | 0 | 0 | 0 | 0 |
Net revenue | 0 | 0 | 0 | 0 |
Expenses and other income: | ||||
Store operating expenses | 0 | 0 | 0 | 0 |
Administrative expenses | 29,977 | 29,999 | 87,699 | 93,542 |
Depreciation and amortization | 2,650 | 5,249 | 8,844 | 16,322 |
Interest expense | 7,866 | 6,129 | 20,593 | 17,827 |
Interest income | (495) | (418) | (2,216) | (1,138) |
Merger and other acquisition expenses | 3,222 | 911 | 5,574 | 3,164 |
Loss on extinguishment of debt | 20 | 14,114 | ||
Total expenses and other income | 43,220 | 41,890 | 120,494 | 143,831 |
Income (loss) before income taxes | $ (43,220) | $ (41,890) | $ (120,494) | $ (143,831) |