Document and Company Informatio
Document and Company Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 21, 2022 | Jun. 30, 2021 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38047 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 45-0491516 | ||
Entity Address, Address Line One | 5501 Headquarters Drive | ||
Entity Address, City or Town | Plano | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 75024 | ||
City Area Code | 972 | ||
Local Phone Number | 801-1100 | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | RCII | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
IcfrAuditorAttestationFlag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3,218,791,451 | ||
Entity Public Float Shares | 60,651,808 | ||
Entity Common Stock, Shares Outstanding | 59,028,739 | ||
Documents Incorporated by Reference | Portions of the definitive proxy statement relating to the 2022 Annual Meeting of Stockholders of Rent-A-Center, Inc. are incorporated by reference into Part III of this report. | ||
Entity Central Index Key | 0000933036 | ||
Entity Registrant Name | RENT A CENTER INC DE | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2021 | |
Auditor [Line Items] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young, LLP |
Auditor Location | Dallas, TX |
Consolidated Statement of Opera
Consolidated Statement of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Store [Abstract] | |||
Rentals and fees | $ 3,522,453 | $ 2,263,091 | $ 2,224,402 |
Merchandise sales | 829,222 | 378,717 | 304,630 |
Installment sales | 73,585 | 68,500 | 70,434 |
Other | 4,148 | 3,845 | 4,795 |
Total store revenues | 4,429,408 | 2,714,153 | 2,604,261 |
Franchise [Abstract] | |||
Merchandise sales | 126,856 | 80,023 | 49,135 |
Royalty income and fees | 27,187 | 20,015 | 16,456 |
Total revenues | 4,583,451 | 2,814,191 | 2,669,852 |
Store [Abstract] | |||
Cost of rentals and fees | 1,260,434 | 655,612 | 634,878 |
Cost of merchandise sold | 935,765 | 382,182 | 319,006 |
Cost of installment sales | 25,637 | 24,111 | 23,383 |
Total cost of store revenues | 2,221,836 | 1,061,905 | 977,267 |
Franchise [Abstract] | |||
Franchise cost of merchandise sold | 126,603 | 80,134 | 48,514 |
Total cost of revenues | 2,348,439 | 1,142,039 | 1,025,781 |
Gross profit | 2,235,012 | 1,672,152 | 1,644,071 |
Operating expenses [Abstract] | |||
Labor | 644,763 | 579,125 | 630,096 |
Other store expenses | 770,073 | 609,370 | 617,106 |
General and administrative expenses | 194,894 | 153,108 | 142,634 |
Depreciation, Amortization and Write-down of Intangibles | 54,830 | 56,658 | 61,104 |
Other charges and (gains) | 289,913 | 36,555 | (60,728) |
Total operating expenses | 1,954,473 | 1,434,816 | 1,390,212 |
Operating profit | 280,539 | 237,336 | 253,859 |
Debt refinancing charges | 15,582 | 0 | 2,168 |
Interest expense | 70,874 | 15,325 | 31,031 |
Interest income | (221) | (768) | (3,123) |
Earnings before income taxes | 194,304 | 222,779 | 223,783 |
Income tax expense | 59,364 | 14,664 | 50,237 |
Net earnings | $ 134,940 | $ 208,115 | $ 173,546 |
Basic earnings per common share | $ 2.37 | $ 3.84 | $ 3.19 |
Diluted earnings per common share | 2.02 | 3.73 | 3.10 |
Cash dividends declared per common share | $ 1.27 | $ 1.18 | $ 0.54 |
Statements of Comprehensive Inc
Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Consolidated Statements of Comprehensive Income (Loss) [Abstract] | |||
Net earnings | $ 134,940 | $ 208,115 | $ 173,546 |
Foreign currency translation adjustments, net of tax of $(259), $(193), and $158 for 2021, 2020, and 2019, respectively | (975) | (726) | 595 |
Total other comprehensive (loss) income | (975) | (726) | 595 |
Comprehensive income | 133,965 | 207,389 | 174,141 |
Foreign currency translation tax adjustment | $ (259) | $ (193) | $ 158 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
ASSETS [Abstract] | ||
Receivables, net of allowance for doubtful accounts of $8,479 and $8,047 in 2021 and 2020, respectively | $ 126,378 | $ 90,003 |
Prepaid expenses and other assets | 63,468 | 50,006 |
Rental merchandise, net [Abstract] | ||
On rent | 1,173,024 | 762,886 |
Held for rent | 132,984 | 146,266 |
Merchandise held for installment sale | 6,405 | 5,439 |
Property assets, net of accumulated depreciation of $557,453 and $505,074 in 2021 and 2020, respectively | 308,098 | 141,641 |
Operating lease right-of-use assets | 291,338 | 283,422 |
Deferred tax asset | 68,391 | 33,782 |
Goodwill | 289,750 | 70,217 |
Other intangible assets, net | 425,158 | 7,869 |
Total assets | 2,993,327 | 1,750,980 |
LIABILITIES [Abstract] | ||
Accounts payable — trade | 135,666 | 186,063 |
Accrued liabilities | 362,708 | 320,583 |
Operating lease liabilities | 296,535 | 285,354 |
Deferred tax liability | 113,943 | 176,410 |
Senior debt, net | 1,135,207 | 190,490 |
Senior notes, net | 435,992 | 0 |
Total liabilities | $ 2,480,051 | $ 1,158,900 |
Common stock - shares authorized | 250,000,000 | 250,000,000 |
Common stock - shares issued | 124,398,373 | 112,180,517 |
STOCKHOLDERS' EQUITY [Abstract] | ||
Common stock, $0.01 par value; 250,000,000 shares authorized; 124,398,373 and 112,180,517 shares issued in 2021 and 2020, respectively | $ 1,065 | $ 1,105 |
Additional paid-in capital | 1,146,509 | 886,902 |
Retained earnings | 1,143,647 | 1,091,010 |
Treasury stock at cost, 58,227,367 and 57,891,859 shares in 2021 and 2020, respectively | 1,765,574 | 1,375,541 |
Accumulated other comprehensive loss | (12,371) | (11,396) |
Total stockholders' equity | 513,276 | 592,080 |
Total liabilities and stockholders' equity | $ 2,993,327 | $ 1,750,980 |
Treasury stock - shares at cost | 58,227,367 | 57,891,859 |
Common stock - par value | $ 0.01 | $ 0.01 |
Allowance for doubtful accounts | $ 8,479 | $ 8,047 |
Accumulated depreciation of property assets | $ 557,453 | $ 505,074 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive (Loss) Income [Member] |
Beginning balance, shares at Dec. 31, 2018 | 109,910,000 | |||||
Beginning balance at Dec. 31, 2018 | $ 286,517 | $ 1,099 | $ 838,436 | $ 805,924 | $ (1,347,677) | $ (11,265) |
Beginning balance (Accounting Standards Update 2014-09 [Member]) at Dec. 31, 2018 | (1,976) | (1,976) | ||||
Net earnings | 173,546 | 173,546 | ||||
Accumulated Other Comprehensive (Loss) Income | 595 | 595 | ||||
Total other comprehensive (loss) income | 595 | |||||
Purchase of treasury stock | 1,292 | 1,292 | ||||
Exercise of stock options, shares | 550,000 | |||||
Exercise of stock options | 6,799 | $ 5 | 6,794 | |||
Vesting of restricted share units, shares | 267,000 | |||||
Vesting of restricted share units | 0 | $ 2 | (2) | |||
Tax effect of stock awards vested and options exercised | (1,734) | (1,734) | ||||
Stock-based compensation expense | (6,958) | 6,958 | ||||
Dividends declared | 29,619 | 29,619 | ||||
Merchants Preferred acquisition, shares | 439,000 | |||||
Merchants Preferred acquisition | 19,169 | $ 4 | 19,165 | |||
Ending balance, shares at Dec. 31, 2019 | 111,166,000 | |||||
Ending balance at Dec. 31, 2019 | 458,963 | $ 1,110 | 869,617 | 947,875 | (1,348,969) | (10,670) |
Ending balance (Accounting Standards Update 2016-02 [Member]) at Dec. 31, 2019 | (769) | |||||
Ending balance (Accounting Standards Update 2016-13 [Member]) at Dec. 31, 2019 | (769) | |||||
Net earnings | 208,115 | 208,115 | ||||
Accumulated Other Comprehensive (Loss) Income | (726) | (726) | ||||
Total other comprehensive (loss) income | $ (726) | |||||
Common stock repurchased, shares | 1,463,377 | (14,000) | ||||
Purchase of treasury stock | $ (26,586) | (26,572) | ||||
Exercise of stock options, shares | 494,000 | |||||
Exercise of stock options | 10,280 | $ 5 | 10,275 | |||
Vesting of restricted share units, shares | 521,000 | |||||
Vesting of restricted share units | 0 | $ 4 | (4) | |||
Tax effect of stock awards vested and options exercised | (5,270) | (5,270) | ||||
Stock-based compensation expense | 12,284 | 12,284 | ||||
Dividends declared | (64,211) | (64,211) | ||||
Ending balance, shares at Dec. 31, 2020 | 112,181,000 | |||||
Ending balance at Dec. 31, 2020 | 592,080 | $ 1,105 | 886,902 | 1,091,010 | (1,375,541) | (11,396) |
Net earnings | 134,940 | 134,940 | ||||
Accumulated Other Comprehensive (Loss) Income | (975) | (975) | ||||
Total other comprehensive (loss) income | (975) | |||||
Purchase of treasury stock | $ (390,112) | $ (79) | (390,033) | |||
Exercise of stock options, shares | 476,398 | 477,000 | ||||
Exercise of stock options | $ 12,054 | $ 4 | 12,050 | |||
Vesting of restricted share units, shares | 960,000 | |||||
Vesting of restricted share units | 0 | $ 8 | (8) | |||
Tax effect of stock awards vested and options exercised | (20,903) | (20,903) | ||||
Stock-based compensation expense | 147,554 | 147,554 | ||||
Dividends declared | (82,303) | (82,303) | ||||
Merchants Preferred acquisition, shares | 10,780,000 | |||||
Merchants Preferred acquisition | 120,941 | $ 27 | 120,914 | |||
Ending balance, shares at Dec. 31, 2021 | 124,398,000 | |||||
Ending balance at Dec. 31, 2021 | $ 513,276 | $ 1,065 | $ 1,146,509 | $ 1,143,647 | $ (1,765,574) | $ (12,371) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities [Abstract] | |||
Net earnings | $ 134,940 | $ 208,115 | $ 173,546 |
Adjustments to reconcile net earnings to net cash provided by operating activities [Abstract] | |||
Depreciation of rental merchandise | 1,216,735 | 633,695 | 619,353 |
Bad debt expense | 14,397 | 14,635 | 15,077 |
Stock-based compensation expense | 147,554 | 12,284 | 6,958 |
Depreciation for property assets | 67,091 | 55,597 | 60,592 |
Loss (gain) on sale or disposal of property assets | 353 | 18,215 | (23,537) |
Amortization of intangibles | 102,742 | 1,070 | 723 |
Amortization of financing fees | 6,008 | 1,577 | 2,987 |
Write-off of debt financing fees | 9,926 | 0 | 2,168 |
Deferred income taxes | 48,315 | (6,605) | 55,257 |
Changes in operating assets and liabilities, net of effects of acquisitions | |||
Rental merchandise | (1,273,734) | (736,444) | (651,487) |
Receivables | (25,516) | (20,674) | (28,855) |
Prepaid expenses and other assets | (12,766) | (3,963) | 3,185 |
Operating lease right-of-use assets and lease liabilities | 2,712 | (1,543) | 4,366 |
Accounts payable — trade | (66,419) | 17,943 | 54,282 |
Accrued liabilities | 19,960 | 42,600 | (79,199) |
Net cash provided by operating activities | 392,298 | 236,502 | 215,416 |
Cash flows from investing activities | |||
Purchase of property assets | (62,450) | (34,545) | (21,157) |
Proceeds from sale of assets | 4 | 14,477 | 69,717 |
Hurricane insurance recovery proceeds | 0 | 158 | 1,113 |
Acquisitions of businesses | (1,273,528) | (700) | (28,915) |
Net cash (used in) provided by investing activities | (1,335,974) | (20,610) | 20,758 |
Cash flows from financing activities | |||
Share repurchases | (390,112) | (26,572) | (1,292) |
Exercise of stock options | 12,054 | 10,280 | 6,799 |
Shares withheld for payment of employee tax withholdings | (20,903) | (5,270) | (1,733) |
Debt issuance costs | (47,622) | 0 | (8,454) |
Proceeds from debt | 1,780,000 | 198,000 | 305,400 |
Repayments of debt | (369,063) | (240,000) | (608,640) |
Dividends paid | (71,505) | (63,119) | (13,707) |
Net cash provided by (used in) financing activities | 892,849 | (126,681) | (321,627) |
Effect of exchange rate changes on cash | (289) | (256) | 556 |
Net (decrease) increase in cash and cash equivalents | (51,116) | 88,955 | (84,897) |
Cash and cash equivalents at beginning of year | 159,449 | 70,494 | 155,391 |
Cash and cash equivalents at end of year | 108,333 | 159,449 | 70,494 |
Supplemental cash flow information [Abstract] | |||
Interest | 51,071 | 14,222 | 32,114 |
Income taxes (excludes $1,571, $32,318, and $2,074 of income taxes refunded in 2021, 2020, and 2019, respectively) | 19,340 | 51,569 | 24,332 |
Income taxes refunded | $ 1,571 | $ 32,318 | $ 2,074 |
Nature of Operations and Summar
Nature of Operations and Summary of Accounting Policies (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Nature of Operations and Summary of Accounting Policies [Abstract] | |
Nature of Operations and Summary of Accounting Policies [Text Block] | Nature of Operations and Summary of Accounting Policies A summary of the significant accounting policies consistently applied in the preparation of the accompanying consolidated financial statements follows: Principles of Consolidation and Nature of Operations The financial statements included herein include the accounts of Rent-A-Center, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated. Unless the context indicates otherwise, references to “Rent-A-Center” refer only to Rent-A-Center, Inc., the parent, and references to the “Company,” “we,” “us” and “our” refer to the consolidated business operations of Rent-A-Center and any or all of its direct and indirect subsidiaries. We report four operating segments: Rent-A-Center Business, Acima, Mexico and Franchising. Our Rent-A-Center Business segment consists of company-owned lease-to-own stores in the United States and Puerto Rico that lease household durable goods to customers on a lease-to-own basis. We also offer merchandise on an installment sales basis in certain of our stores under the names “Get It Now” and “Home Choice.” Our Rent-A-Center Business segment operates through our company-owned stores and e-commerce platform through rentacenter.com. At December 31, 2021, we operated 1,846 company-owned stores nationwide and in Puerto Rico, including 45 retail installment sales stores. Our Acima segment, which operates in the United States and Puerto Rico, and includes the operations of Merchants Preferred (as defined in Note B below) acquired in August 2019, generally offers the lease-to-own transaction to consumers who do not qualify for financing from the traditional retailer through kiosks located within such retailer’s locations, including staffed options and unstaffed or virtual options. Virtual locations employ a virtual solution where customers, either directly or with the assistance of a representative of the third-party retailer, initiate the lease-to-own transaction online in the retailers’ locations using our virtual solutions. Our Mexico segment consists of our company-owned lease-to-own stores in Mexico that lease household durable goods to customers on a lease-to-own basis. At December 31, 2021, we operated 123 stores in Mexico. Rent-A-Center Franchising International, Inc., an indirect wholly-owned subsidiary of Rent-A-Center, is a franchisor of lease-to-own stores. At December 31, 2021, Franchising had 466 franchised stores operating in 32 states. Our Franchising segment’s primary source of revenue is the sale of rental merchandise to its franchisees, who in turn offer the merchandise to the general public for rent or purchase under a lease-to-own transaction. The balance of our Franchising segment’s revenue is generated primarily from royalties based on franchisees’ monthly gross revenues. Rental Merchandise Rental merchandise is carried at cost, net of accumulated depreciation. Depreciation for merchandise in Rent-A-Center Business and staffed Acima locations is generally provided using the income forecasting method, which is intended to match as closely as practicable the recognition of depreciation expense with the consumption of the rental merchandise, and assumes no salvage value. The consumption of rental merchandise occurs during periods of rental and directly coincides with the receipt of rental revenue over the rental purchase agreement period. Under the income forecasting method, merchandise held for rent is not depreciated and merchandise on rent is depreciated in the proportion of rents received to total rents provided in the rental contract, which is an activity-based method similar to the units of production method. In addition, we depreciate merchandise (including computers and tablets) that is held for rent for at least 180 consecutive days using the straight-line method over a period generally not to exceed 18 months. Smartphones are depreciated over an 18-month straight-line basis beginning with the earlier of on rent or 90 consecutive days held for rent. Depreciation of merchandise in our virtual business is recognized using a straight-line method over the term of the lease contract. Rental merchandise that is damaged and inoperable is expensed when such impairment occurs. If a customer does not return the merchandise or make payment, the remaining book value of the rental merchandise associated with delinquent accounts is generally charged off on or before the 90 th day following the time the account became past due in the Rent-A-Center Business and Mexico segments, and during the month following the 120 th day in our Acima virtual business and 150 th day in our Acima staffed locations. Minor repairs made to rental merchandise are expensed at the time of the repair. In addition, we maintain a reserve for these expected losses, which estimates the merchandise losses incurred but not yet identified by management as of the end of the accounting period based on a combination of historical write-offs and expected future losses. As of December 31, 2021 and 2020, the reserve for merchandise losses was $98.2 million and $58.1 million, respectively. Expenses related to merchandise losses, damaged merchandise, or merchandise repairs are recorded to other store expenses in our Consolidated Statement of Operations. Cash Equivalents Cash equivalents include all highly liquid investments with an original maturity of three months or less. We maintain cash and cash equivalents at several financial institutions, which at times may not be federally insured or may exceed federally insured limits. We have not experienced any losses in such accounts and believe we are not exposed to any significant credit risks on such accounts. Revenues Merchandise is rented to customers pursuant to rental purchase agreements which provide for weekly, semi-monthly or monthly rental terms with non-refundable rental payments. Generally, the customer has the right to acquire title either through a purchase option or through payment of all required rentals. Rental revenue and fees are recognized over the rental term and merchandise sales revenue is recognized when the customer exercises the purchase option and pays the cash price due. Cash received prior to the period in which it should be recognized is deferred and recognized according to the rental term. Revenue is accrued for uncollected amounts due based on historical collection experience. However, the total amount of the rental purchase agreement is not accrued because the customer can terminate the rental agreement at any time and we cannot enforce collection for non-payment of future rents. Revenues from the sale of merchandise in our retail installment stores are recognized when the installment note is signed, the customer has taken possession of the merchandise and collectability is reasonably assured. Franchise revenues from the sale of rental merchandise are recognized upon shipment of the merchandise to the franchisee. Franchise royalty income and fee revenue is recognized upon completion of substantially all services and satisfaction of all material conditions required under the terms of the franchise agreement. Initial franchise fees charged to franchisees for new or converted franchise stores are recognized on a straight-line basis over the term of the franchise agreement. Receivables and Allowance for Doubtful Accounts The installment notes receivable associated with the sale of merchandise at our Get It Now and Home Choice stores generally consists of the sales price of the merchandise purchased and any additional fees for services the customer has chosen, less the customer’s down payment. No interest is accrued and interest income is recognized each time a customer makes a payment, generally on a monthly basis. We have established an allowance for doubtful accounts for our installment notes receivable. Our policy for determining the allowance is based on historical loss experience, as well as the results of management’s review and analysis of the payment and collection of the installment notes receivable within the previous year. We believe our allowance is adequate to absorb any known or probable losses. Our policy is to charge off installment notes receivable that are 120 days or more past due. Charge-offs are applied as a reduction to the allowance for doubtful accounts and any recoveries of previously charged off balances are applied as an increase to the allowance for doubtful accounts. Our trade and notes receivables consist primarily of amounts due from our rental customers for renewal and uncollected rental payments, Franchising receivables, and other corporate related receivables. The majority of our Franchising trade and notes receivables relate to amounts due from franchisees for inventory purchases, earned royalties and other obligations. Credit is extended based on an evaluation of a franchisee’s financial condition and collateral is generally not required. Trade receivables are generally due within 30 days and are reported as amounts due from franchisees, net of an allowance for doubtful accounts. Accounts that are outstanding longer than the contractual payment terms are considered past due. Franchising determines its allowance by considering a number of factors, including the length of time receivables are past due, previous loss history, the franchisee’s current ability to pay its obligation, and the condition of the general economy and the industry as a whole. Franchising writes off trade receivables that are 90 or more days past due and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Property Assets and Related Depreciation Furniture, equipment and vehicles are stated at cost less accumulated depreciation. Depreciation is provided over the estimated useful lives of the respective assets (generally 5 years) on the straight-line method. Leasehold improvements are amortized over the useful life of the asset or the initial term of the applicable leases on the straight-line method, whichever is shorter. We have incurred costs to develop computer software for internal use. We capitalize the costs incurred during the application development stage, which includes designing the software configuration and interfaces, coding, installation, and testing. Costs incurred during the preliminary stages along with post-implementation stages of internally developed software are expensed as incurred. Internally developed software costs, once placed in service, are amortized over various periods up to 10 years. We incur repair and maintenance expenses on our vehicles and equipment. These amounts are recognized when incurred, unless such repairs significantly extend the life of the asset, in which case we amortize the cost of the repairs for the remaining useful life of the asset utilizing the straight-line method. Goodwill and Other Intangible Assets We record goodwill when the consideration paid for an acquisition exceeds the fair value of the identifiable net tangible and identifiable intangible assets acquired. Goodwill is not subject to amortization but must be periodically evaluated for impairment for each reporting unit. Impairment occurs when the carrying value of goodwill is not recoverable from future cash flows. We perform an assessment of goodwill for impairment at the reporting unit level annually as of October 1, or when events or circumstances indicate that impairment may have occurred. Our reporting units are our reportable operating segments. Factors which could necessitate an interim impairment assessment include a sustained decline in our stock price, prolonged negative industry or economic trends and significant underperformance relative to expected historical or projected future operating results. Based on our assessment, if the fair value of the reporting unit exceeds its carrying value, then the goodwill is not deemed impaired. If the carrying value of the reporting unit exceeds fair value, goodwill is deemed impaired and the impairment is measured as the difference between the carrying value and the fair value of the respective reporting unit. We determine the fair value of each reporting unit using methodologies which include the present value of estimated future cash flows and comparisons of multiples of enterprise values to earnings before interest, taxes, depreciation and amortization. The analysis is based upon available information regarding expected future cash flows and discount rates. Discount rates are generally based upon our weighted average cost of capital. As an alternative to performing a quantitative assessment to measure the fair value of the reporting unit, the Company may perform a qualitative assessment for impairment if it believes it is not more likely than not that the carrying value of the net assets of the reporting unit exceeds its fair value. At December 31, 2021, the amount of goodwill attributable to the Rent-A-Center Business and Acima segments was approximately $1.5 million and $288.3 million, respectively. We currently do not have goodwill balances attributable to our Mexico or Franchising segments. Acquired intangible assets are recorded at their estimated fair value as of the date of acquisition and generally include customer relationships, merchant relationships, non-compete agreements and trade names. Customer relationships are generally amortized over a 21-month period, excluding Relationships with Existing Lessees recently acquired from Acima Holdings which are being amortized over 12 months. Non-compete Agreements are amortized over the contractual life of the agreements, Merchant Relationships are amortized over a 7 to 10 year period, and Trade Names and other intangible assets are amortized over the estimated life of the asset. Intangible assets are amortized using methods that we believe reflect the pattern in which the economic benefits of the related asset are consumed unless such pattern cannot be reliably determined, in which case we amortize using a straight-line amortization method. Accounting for Impairment of Long-Lived Assets We evaluate all long-lived assets, including intangible assets, excluding goodwill, for impairment whenever events or changes in circumstances indicate that the carrying amounts of the related assets may not be recoverable by the undiscounted net cash flows they will generate. Impairment is recognized when the carrying amounts of such assets exceed their fair value. We determine the fair value of our long-lived assets using methodologies which include the present value of estimated future cash flows of the asset, or related fair market values for similar assets. Self-Insurance Liabilities We have self-insured retentions with respect to losses under our workers’ compensation, general liability, vehicle liability and health insurance programs. We establish reserves for our liabilities associated with these losses by obtaining forecasts for the ultimate expected losses and estimating amounts needed to pay losses within our self-insured retentions. We make assumptions on our liabilities within our self-insured retentions using actuarial loss forecasts, company-specific development factors, general industry loss development factors, and third-party claim administrator loss estimates which are based on known facts surrounding individual claims. These assumptions incorporate expected increases in health care costs. Periodically, we reevaluate our estimate of liability within our self-insured retentions. At that time, we evaluate the adequacy of our reserves by comparing amounts reserved on our balance sheet for anticipated losses to our updated actuarial loss forecasts and third-party claim administrator loss estimates, and make adjustments to our reserves as needed. Foreign Currency Translation The functional currency of our foreign operations is the applicable local currency. Assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the current rate of exchange on the last day of the reporting period. Revenues and expenses are generally translated at a daily exchange rate and equity transactions are translated using the actual rate on the day of the transaction. Other Comprehensive (Loss) Income Other comprehensive (loss) income is comprised exclusively of our foreign currency translation adjustment. Income Taxes We record deferred taxes for temporary differences between the tax and financial reporting bases of assets and liabilities at the enacted tax rate expected to be in effect when those temporary differences are expected to be recovered or settled. Income tax accounting requires management to make estimates and apply judgments to events that will be recognized in one period under rules that apply to financial reporting in a different period in our tax returns. In particular, judgment is required when estimating the value of future tax deductions, tax credits and net operating loss carryforwards (NOLs), as represented by deferred tax assets. We evaluate the recoverability of these future tax deductions and credits by assessing the future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies. These sources of income rely heavily on estimates. We use our historical experience and our short- and long-range business forecasts to provide insight and assist us in determining recoverability. When it is determined the recovery of all or a portion of a deferred tax asset is not likely, a valuation allowance is established. We include NOLs in the calculation of deferred tax assets. NOLs are utilized to the extent allowable due to the provisions of the Internal Revenue Code of 1986, as amended, and relevant state statutes. We recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon the ultimate settlement with the relevant tax authority. A number of years may elapse before a particular matter, for which we have recorded a liability, is audited and effectively settled. We review our tax positions quarterly and adjust our liability for unrecognized tax benefits in the period in which we determine the issue is effectively settled with the tax authorities, the statute of limitations expires for the relevant taxing authority to examine the tax position, or when more information becomes available. We classify accrued interest and penalties related to unrecognized tax benefits as interest expense and general & administrative expense, respectively. Sales Taxes We apply the net basis for sales taxes imposed on our goods and services in our Consolidated Statements of Operations. We are required by the applicable governmental authorities to collect and remit sales taxes. Accordingly, such amounts are charged to the customer, collected and remitted directly to the appropriate jurisdictional entity. Earnings Per Common Share Basic earnings per common share are based upon the weighted average number of common shares outstanding during each period presented. Diluted earnings per common share are based upon the weighted average number of common shares outstanding during the period, plus, if dilutive, the assumed exercise of stock options and vesting of stock awards at the beginning of the year, or for the period outstanding during the year for current year issuances. Advertising Costs Costs incurred for producing and communicating advertising are expensed when incurred. Advertising expense was $73.9 million, $50.9 million, and $58.8 million, for the years ended December 31, 2021, 2020, and 2019, respectively. Advertising expense is net of vendor allowances of $21.6 million, $24.8 million, and $21.2 million for the years ended December 31, 2021, 2020, and 2019, respectively. Stock-Based Compensation We maintain long-term incentive plans for the benefit of certain employees and directors, which are described more fully in Note O. We recognize share-based payment awards to our employees and directors at the estimated fair value on the grant date. Determining the fair value of any share-based award requires information about several variables that include, but are not limited to, expected stock volatility over the term of the award, expected dividend yields, and the risk free interest rate. We base the expected term on historical exercise and post-vesting employment-termination experience, and expected volatility on historical realized volatility trends. In addition, all stock-based compensation expense is recorded net of an estimated forfeiture rate. The forfeiture rate is based upon historical activity and is analyzed at least annually as actual forfeitures occur. Compensation costs are recognized net of estimated forfeitures over the requisite service period on a straight-line basis. We issue new shares to settle stock awards. Stock options are valued using a Black-Scholes pricing model. Time-vesting restricted stock units are valued using the closing price on the Nasdaq Global Select Market on the day before the grant date, adjusted for any provisions affecting fair value, such as the lack of dividends or dividend equivalents during the vesting period. Performance-based restricted stock units will vest in accordance with a total shareholder return formula, and are valued by a third-party valuation firm using Monte Carlo simulations. Reclassifications Certain reclassifications may be made to the reported amounts for prior periods to conform to the current period presentation. These reclassifications have no impact on net earnings or earnings per share in any period. Use of Estimates In preparing financial statements in conformity with U.S. generally accepted accounting principles, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent losses and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. In applying accounting principles, we must often make individual estimates and assumptions regarding expected outcomes or uncertainties. Our estimates, judgments and assumptions are continually evaluated based on available information and experience. However, uncertainties, including future unknown impacts of the COVID-19 pandemic, may affect certain estimates and assumptions inherent in the financial reporting process, which may impact reported amounts of assets and liabilities in future periods and cause actual results to differ from those estimates. Newly Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. The standard removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. We adopted ASU 2019-12 beginning January 1, 2021 using a prospective approach. Impacts to our financial statements for the twelve months ended December 31, 2021 resulting from the adoption of this ASU were immaterial. |
Newly Adopted Accounting Pronouncements [Text Block] | Newly Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. The standard removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. We adopted ASU 2019-12 beginning January 1, 2021 using a prospective approach. Impacts to our financial statements for the twelve months ended December 31, 2021 resulting from the adoption of this ASU were immaterial. |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures Acima Acquisition On February 17, 2021, we completed the acquisition of Acima Holdings for total estimated consideration of $1.4 billion. Acima Holdings is a platform offering customers virtual lease-to-own solutions at the point-of-sale via web and mobile technology. In accordance with the Merger Agreement, we issued to the former owners of Acima Holdings an aggregate of 10,779,923 shares of our common stock (the “Aggregate Stock Consideration”) and paid to them aggregate cash consideration of $1.3 billion (the “Aggregate Cash Consideration”). In accordance with the terms of the Merger Agreement, the portion of the Aggregate Stock Consideration issued to former owners of Acima Holdings who are also employees of Acima Holdings is subject to restricted stock agreements providing vesting conditions over a 36-month period beginning upon closing of the Merger. The portion of the Aggregate Stock Consideration issued to nonemployee former owners of Acima Holdings is subject to the terms of an 18-month lockup agreement, pursuant to which one-third of the aggregate shares of our common stock received by a non-employee former owner in the Merger becomes transferable after each six-month period following the closing of the Merger. We entered into a Registration Rights Agreement, dated as of February 17, 2021, pursuant to which certain former owners of Acima are entitled to registration rights in respect of the portion of the Aggregate Stock Consideration received by them in the Merger. The aggregate purchase price was approximately $1.4 billion, including net cash consideration of approximately $1.3 billion, and 2,683,328 shares of the Aggregate Stock Consideration subject to 18-month lockup agreements valued at $51.14 per share, as of the date of closing, adjusted by a discount for lack of marketability to account for the transfer restrictions in three tranches, each in 6-month intervals after the closing date. The Aggregate Cash Consideration for the acquisition was financed with a combination of cash on hand, borrowings under our ABL Credit Facility and proceeds from issuances under our Term Loan Facility, as defined in Note K, in addition to proceeds from the issuance of new unsecured senior notes. See Note K and Note L for additional information. The remaining 8,096,595 common shares included in the Aggregate Stock Consideration subject to 36-month vesting conditions were valued at $414.1 million, as of the date of closing. These shares have been excluded from the aggregate purchase price and instead are being recognized as stock-based compensation expense subject to ASC Topic 718, “Stock-based Compensation”, over the required vesting period, and recorded to Other charges in our Consolidated Statements of Operations. Assets acquired and liabilities assumed in connection with the acquisition have been recorded at their fair values. The following table provides the estimated fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date: (in thousands) February 17, 2021 Aggregate cash consideration $ 1,273,263 Aggregate stock consideration, subject to lockup agreements 120,929 Total Purchase price $ 1,394,192 ASSETS ACQUIRED Receivables, net (1) $ 25,255 Prepaid expenses and other assets 700 Rental merchandise On rent 340,575 Property assets 171,455 Operating lease right-of-use assets 9,136 Deferred income taxes 28,559 Goodwill 219,530 Other intangible assets 520,000 Total assets acquired $ 1,315,210 LIABILITIES ASSUMED Accounts payable - trade 16,023 Accrued liabilities 11,716 Operating lease liabilities 9,689 Deferred income taxes (116,410) Total liabilities assumed (78,982) Total equity value $ 1,394,192 (1) Includes gross contractual receivables of $61.6 million related to merchandise lease contracts, of which $34.7 million were estimated to be uncollectible. Carrying value for assets and liabilities assumed as part of the acquisition, including receivables, prepaid expenses and other assets, accounts payable and accrued liabilities were recorded as fair value, as of the date of acquisition, due to the short term nature of these balances. Operating lease right-of-use assets and liabilities were recorded as the discounted value of future obligations in accordance with ASC Topic 842, “Leases”. The fair value measurements for acquired intangible assets and developed technology were primarily based on significant unobservable inputs (Level 3) developed using company-specific information. Certain fair value estimates were determined based on an independent valuation of the net assets acquired, including $340.6 million of rental merchandise and $520 million of identifiable intangible assets with an estimated weighted average useful life of 8 years, as follows: Asset Class Estimated Fair Value Estimated Remaining Useful Life (in years) Merchant relationships $ 380,000 10 Relationship with existing lessees 60,000 1 Trade name 40,000 7 Non-compete agreements 40,000 3 Developed technology, included in Property assets, net, in line with our accounting policies, was also acquired with a value of $170.0 million and an estimated remaining useful life of 10 years. The fair value for these intangible and property assets were estimated using common industry valuation methods for similar asset types, based primarily on cost inputs and projected cash flows. In addition, we recorded goodwill of $219.5 million in our Acima operating segment, which consists of the excess of the net purchase price over the fair value of the net assets acquired. Goodwill represents expected cost and revenue synergies and other benefits expected to result within our retail partner business from the acquisition of Acima Holdings. The total value of goodwill for tax purposes differs from recorded goodwill as a result of the Aggregate Stock Consideration subject to restricted stock agreements, differences in value assigned to other purchased assets, and acquisition-related expenses. Tax goodwill will be amortized over 15 years. Acima Holdings results of operations are reflected in our Consolidated Statements of Operations from the date of acquisition. Subsequent to the date of acquisition, we recorded certain adjustments to the purchase price allocation within the measurement period, including an adjustment to the fair value of rental merchandise decreasing the value of the acquired assets by approximately $17.1 million. The adjustment to the fair value of rental merchandise was based on further assessment of the carrying value of the assets and corresponding evaluation of related (Level 2) market inputs. In connection with the adjustment to decrease the value of acquired rental merchandise we recorded corresponding adjustments to decrease rental merchandise depreciation by approximately $14.3 million, representing the period from the date of acquisition through December 31, 2021. The adjustment to rental merchandise depreciation is reflected in cost of rentals and fees in our Consolidated Statement of Operations. Total cumulative measurement period adjustments resulted in a decrease to goodwill of approximately $(22.2) million. The purchase price allocation for the Acima Holdings acquisition was complete as of December 31, 2021. In connection with this acquisition, we incurred approximately $23.7 million in acquisition-related expenses including expenses related to legal, professional, and banking transaction fees, which are treated as an addition to goodwill for tax purposes. These costs were included in Other charges (gains) in our Consolidated Statements of Operations. The following unaudited pro forma combined results of operations present our financial results as if the acquisition of Acima had been completed on January 1, 2020. These unaudited pro forma results may not necessarily reflect the actual results of operations that would have been achieved, nor are they necessarily indicative of future results of operations. The unaudited pro forma information reflects the step-up depreciation and amortization adjustments for the fair value of the assets acquired, adjustments to stock compensation expense as a result of Aggregate Stock Consideration subject to restricted stock awards, the adjustments in interest expense due to the elimination of historical debt and placement of the new debt, and the related adjustments to the income tax provision. In addition, the pro forma net income has been adjusted to include transaction expenses and other non-recurring costs as of January 1, 2020. The unaudited pro forma financial information is as follows: Year Ended December 31, (in thousands) 2021 2020 (unaudited) (unaudited) Pro Forma total revenues $ 4,778,055 $ 4,071,990 Pro Forma net earnings (1) 178,103 66,352 (1) Total pro forma adjustments to net earnings represented an increase of $16.0 million and a decrease of $356.8 million for the twelve months ended December 31, 2021 and 2020, respectively. The amounts of revenue and earnings of Acima Holdings included in our Consolidated Statements of Operations as of December 31, 2021 and 2020 from the acquisition date of February 17th for each year presented are as follows: (in thousands) February 17, 2021 - December 31, 2021 February 17, 2020 - December 31, 2020 audited (unaudited) Total revenues $ 1,495,746 $ 1,116,430 Net earnings (1) 119,183 196,088 (1) Net Earnings for the period February 17, 2021 - December 31, 2021 includes amortization of intangible assets acquired upon closing of the Acima Holdings acquisition. Merchants Preferred Acquisition On August 13, 2019, we completed the acquisition of substantially all of the assets of Merchants Preferred, a nationwide provider of virtual lease-to-own services (“Merchant's Preferred”). The aggregate purchase price was approximately $46.4 million, including net cash consideration of approximately $28.0 million, and 701,918 shares of our common stock valued at $27.31 per share, as of the date of closing, less working capital adjustments of approximately $0.9 million. Assets acquired and liabilities assumed in connection with the acquisition have been recorded at their fair values. The following table provides the final estimated fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date: (in thousands) August 13, 2019 Receivables $ 1,813 Prepaid expenses and other assets 154 Rental merchandise 17,904 Software 4,300 Right of use operating leases 404 Other intangible assets 8,900 Goodwill 13,403 Lease liabilities (487) Net identifiable assets acquired $ 46,391 The fair value measurements were primarily based on significant unobservable inputs (Level 3) developed using company-specific information. Certain fair value estimates were determined based on an independent valuation of the net assets acquired, including identifiable intangible assets, relating to dealer relationships, of $8.9 million, and software of $4.3 million. The fair value for dealer relationships and software were estimated using common industry valuation methods for similar asset types, based primarily on cost inputs and projected cash flows. The dealer relationships and software assets were both assigned remaining lives of 10 years. In addition, we recorded goodwill of $13.4 million, which consists of the excess of the net purchase price over the fair value of the net assets acquired. The goodwill was not deductible for tax purposes. Merchants Preferred's results of operations are reflected in our Consolidated Statements of Operations from the date of acquisition. In connection with this acquisition, we recorded approximately $1.4 million in acquisition-related expenses during the twelve months ended December 31, 2019 including expenses related to legal, professional, and banking transaction fees. These costs were included in other charges and (gains) in our consolidated statement of operations. Other Acquisitions The following table provides information concerning other store acquisitions completed during the years ended December 31, 2021, 2020 and 2019. Year Ended December 31, (Dollar amounts in thousands) 2021 2020 2019 Number of stores acquired remaining open 1 — — Number of stores acquired that were merged with existing stores — 2 4 Number of transactions 1 2 4 Total purchase price $ 278 $ 700 $ 504 Amounts allocated to: Goodwill $ — $ — $ 66 Customer relationships 30 177 85 Rental merchandise 248 523 353 Operating results of the acquired stores and accounts have been included in the financial statements since their date of acquisition. California Refranchise Sale On October 5, 2020, we sold all 99 Rent-A-Center Business corporate stores in the state of California to an experienced franchisee. We received cash consideration of approximately $16.0 million, including approximately $1.0 million in respect of related franchise fees. The sale included idle and on-rent inventory of approximately $30.0 million and property assets of approximately $0.8 million, resulting in a total loss on sale of approximately $16.6 million. The loss on sale was recorded to Other charges in our Consolidated Statement of Operations. |
Revenues (Notes)
Revenues (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Revenues [Abstract] | |
Revenues [Text Block] | Revenues The following tables disaggregates our revenue: Twelve Months Ended December 31, 2021 Rent-A-Center Business Acima Mexico Franchising Consolidated (In thousands) Store Rentals and fees $ 1,762,847 $ 1,701,532 $ 58,074 $ — $ 3,522,453 Merchandise sales 199,781 626,166 3,275 — 829,222 Installment sales 73,585 — — — 73,585 Other 1,636 391 54 2,067 4,148 Total store revenues 2,037,849 2,328,089 61,403 2,067 4,429,408 Franchise Merchandise sales — — — 126,856 126,856 Royalty income and fees — — — 27,187 27,187 Total revenues $ 2,037,849 $ 2,328,089 $ 61,403 $ 156,110 $ 4,583,451 Twelve Months Ended December 31, 2020 Rent-A-Center Business Acima Mexico Franchising Consolidated (In thousands) Store Rentals and fees $ 1,604,615 $ 610,908 $ 47,568 $ — $ 2,263,091 Merchandise sales 177,223 198,517 2,977 — 378,717 Installment sales 68,500 — — — 68,500 Other 2,303 726 38 778 3,845 Total store revenues 1,852,641 810,151 50,583 778 2,714,153 Franchise Merchandise sales — — — 80,023 80,023 Royalty income and fees — — — 20,015 20,015 Total revenues $ 1,852,641 $ 810,151 $ 50,583 $ 100,816 $ 2,814,191 Twelve Months Ended December 31, 2019 Rent-A-Center Business Acima Mexico Franchising Consolidated (In thousands) Store Rentals and fees $ 1,585,997 $ 587,502 $ 50,903 $ — $ 2,224,402 Merchandise sales 140,372 161,235 3,023 — 304,630 Installment sales 70,434 — — — 70,434 Other 3,683 523 34 555 4,795 Total store revenues 1,800,486 749,260 53,960 555 2,604,261 Franchise Merchandise sales — — — 49,135 49,135 Royalty income and fees — — — 16,456 16,456 Total revenues $ 1,800,486 $ 749,260 $ 53,960 $ 66,146 $ 2,669,852 Lease Purchase Agreements Rent-A-Center Business, Acima, and Mexico Rentals and Fees. Rental merchandise is leased to customers pursuant to rental purchase agreements which provide for weekly, semi-monthly or monthly rental terms with non-refundable rental payments. At the expiration of each rental term, customers may renew the rental agreement for the next rental term. Generally, the customer has the right to acquire title of the merchandise either through a purchase option or through payment of all required rental terms. Customers can terminate the rental agreement at the end of any rental term without penalty. Therefore, rental transactions are accounted for as operating leases. Rental payments received at our Rent-A-Center Business, Acima (excluding virtual) and Mexico locations must be prepaid in advance of the next rental term. Under the virtual business model, revenues may be earned prior to the rental payment due date, in which case revenue is accrued prior to receipt of the rental payment, net of estimated returns and uncollectible renewal payments. Under both models, rental revenue is recognized over the rental term. See Note D for additional information regarding accrued rental revenue. Cash received for rental payments, including fees, prior to the period in which it should be recognized, is deferred and recognized according to the rental term. At December 31, 2021 and 2020, we had $51.7 million and $45.8 million, respectively, in deferred revenue included in accrued liabilities related to our rental purchase agreements. Revenue related to various payment, reinstatement or late fees is recognized when paid by the customer at the point service is provided. Rental merchandise in our Rent-A-Center Business, former Preferred Lease, and Mexico locations is depreciated using the income forecasting method and recognized in cost of sales over the rental term. Rental merchandise in Acima Holdings is depreciated over the rental term using a straight-line depreciation method. We also offer additional product plans along with our rental agreements which provide customers with liability protection against significant damage or loss of a product, and club membership benefits, including various discount programs and product service and replacement benefits in the event merchandise is damaged or lost, and payment insurance in the event eligible customers become unemployed. Customers renew product plans in conjunction with their rental term renewals, and can cancel the plans at any time. Revenue for product plans is recognized over the term of the plan. Costs incurred related to product plans are primarily recognized in cost of sales. Revenue from contracts with customers Rent-A-Center Business, Acima, and Mexico Merchandise Sales. Merchandise sales include payments received for the exercise of the early purchase option offered through our rental purchase agreements or merchandise sold through point of sale transactions. Revenue for merchandise sales is recognized when payment is received and ownership of the merchandise passes to the customer. The remaining net value of merchandise sold is recorded to cost of sales at the time of the transaction. Installment Sales. Revenue from the sale of merchandise in our retail installment stores is recognized when the installment note is signed and control of the merchandise has passed to the customer. The cost of merchandise sold through installment agreements is recognized in cost of sales at the time of the transaction. We offer extended service plans with our installment agreements which are administered by third parties and provide customers with product service maintenance beyond the term of the installment agreement. Payments received for extended service plans are deferred and recognized, net of related costs, when the installment payment plan is complete and the service plan goes into effect. Customers can cancel extended service plans at any time during the installment agreement period and receive a refund for payments previously made towards the plan. At December 31, 2021 and 2020, we had $2.6 million and $3.1 million, respectively, in deferred revenue included in accrued liabilities related to extended service plans. Other. Other revenue consists of revenue generated by other miscellaneous product plans offered to our rental and installment customers. Revenue for other product plans is recognized in accordance with the terms of the applicable plan agreement. Franchising Merchandise Sales. Revenue from the sale of rental merchandise is recognized upon shipment of the merchandise to the franchisee. Royalty Income and Fees. Franchise royalties, including franchisee contributions to corporate advertising funds, represent sales-based royalties calculated as a percentage of gross rental payments and sales. Royalty revenue is accrued and recognized as rental payments and merchandise sales occur. Franchise fees are initial fees charged to franchisees for new or converted |
Receivables and Allowance for D
Receivables and Allowance for Doubtful Accounts (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Receivables and Allowance for Doubtful Accounts [Abstract] | |
Receivables and Allowance for Doubtful Accounts [Text Block] | Receivables and Allowance for Doubtful Accounts Installment sales receivables consist primarily of receivables due from customers for the sale of merchandise in our retail installment stores. Installment sales receivable associated with the sale of merchandise at our Get It Now and Home Choice stores generally consist of the sales price of the merchandise purchased and any additional fees for services the customer has chosen, less the customer’s down payment. No interest is accrued and interest income is recognized each time a customer makes a payment, generally on a monthly basis. Interest paid on installment agreements for the twelve months ended December 31, 2021, 2020 and 2019 was $12.2 million, $11.5 million, and $10.8 million, respectively. Trade and notes receivables consist of amounts due from our rental customers for renewal and uncollected rental payments; amounts owed from our franchisees for inventory purchases, earned royalties and other obligations; and other corporate related receivables. Credit is extended to franchisees based on an evaluation of each franchisee’s financial condition and collateral is generally not required. Trade receivables are generally due within 30 days. Receivables consist of the following: December 31, (In thousands) 2021 2020 Installment sales receivable $ 66,276 $ 61,794 Trade and notes receivables 68,581 36,256 Total receivables 134,857 98,050 Less allowance for doubtful accounts (8,479) (8,047) Total receivables, net of allowance for doubtful accounts $ 126,378 $ 90,003 We have established an allowance for doubtful accounts for our installment notes receivable. Our policy for determining the allowance is primarily based on historical loss experience, as well as the results of management’s review and analysis of the payment and collection of the installment notes receivable within the previous year. We believe our allowance is adequate to absorb all expected losses. Our policy is to charge off installment notes receivable that are 120 days or more past due. Charge-offs are applied as a reduction to the allowance for doubtful accounts and any recoveries of previously charged off balances are applied as an increase to the allowance for doubtful accounts. The allowance for our Franchising trade and notes receivables is determined by considering a number of factors, including the length of time receivables are past due, previous loss history, the franchisee’s current ability to pay its obligation, and the condition of the general economy and the industry as a whole. Trade receivables that are more than 90 days past due are either written-off or fully reserved in our allowance for doubtful accounts. Payments subsequently received on such receivables are credited to the allowance for doubtful accounts. The allowance for doubtful accounts related to trade and notes receivable was $0.9 million and $1.0 million, and the allowance for doubtful accounts related to installment sales receivable was $7.6 million and $7.0 million at December 31, 2021 and 2020, respectively. Changes in our allowance for doubtful accounts are as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Beginning allowance for doubtful accounts $ 8,047 $ 5,601 $ 4,883 Estimated uncollectible payments and returns (1) 14,397 14,636 15,077 Accounts written off, net of recoveries (13,965) (12,190) (14,359) Ending allowance for doubtful accounts $ 8,479 $ 8,047 $ 5,601 (1) Uncollectible installment payments, franchisee obligations, and other corporate receivables are recognized in other store operating expenses in our consolidated financial statements. |
Rental Merchandise (Notes)
Rental Merchandise (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Rental Merchandise [Abstract] | |
Rental Merchandise [Text Block] | Rental Merchandise December 31, (In thousands) 2021 2020 On rent Cost $ 1,894,247 $ 1,169,333 Less accumulated depreciation (721,223) (406,447) Net book value, on rent $ 1,173,024 $ 762,886 Held for rent Cost $ 155,832 $ 165,879 Less accumulated depreciation (22,848) (19,613) Net book value, held for rent $ 132,984 $ 146,266 |
Property Assets (Notes)
Property Assets (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Property Assets [Abstract] | |
Property Assets [Text Block] | Property Assets December 31, (In thousands) 2021 2020 Software $ 468,011 $ 279,141 Building and leasehold improvements 199,280 196,179 Furniture and equipment 172,418 163,623 Transportation equipment 549 503 Construction in progress 25,293 7,269 Total property assets 865,551 646,715 Less accumulated depreciation (557,453) (505,074) Total property assets, net of accumulated depreciation $ 308,098 $ 141,641 |
Leases (Notes)
Leases (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases [Text Block] | Leases We lease space for all of our Rent-A-Center Business and Mexico stores under operating leases expiring at various times through 2029. In addition, we lease space for certain support facilities under operating leases expiring at various times through 2032. Most of our store leases are five year leases and contain renewal options for additional periods ranging from three to five years at rental rates adjusted according to agreed upon formulas. We evaluate all leases to determine if it is likely that we will exercise future renewal options and in most cases we are not reasonably certain of exercise due to competing market rental rates and lack of significant penalty or business disruption incurred by not exercising the renewal options. In certain situations involving the sale of a Rent-A-Center Business corporate store to a franchisee, we enter into a lease assignment agreement with the buyer, but we remain the primary obligor under the original lease for the remaining active term. These assignments are therefore classified as subleases and the original lease is included in our operating lease right-of-use assets and operating lease liabilities in our Consolidated Balance Sheets. We lease vehicles for all of our Rent-A-Center Business stores under operating leases with lease terms expiring twelve months after the start date of the lease. We classify these leases as short-term and have elected the short-term lease exemption for our vehicle leases, and have therefore excluded them from our operating lease right-of-use assets within our Consolidated Balance Sheets. We also lease vehicles for all of our Mexico stores which have terms expiring at various times through 2025 with rental rates adjusted periodically for inflation. Finally, we have a minimal number of equipment leases, primarily related to temporary storage containers and certain back office technology hardware assets. For all of the leases described above, we have elected not to separate the lease and non-lease components and instead account for these as a single component. In addition, we have elected to use available practical expedients that eliminate the requirement to reassess whether expired or existing contracts contained leases, and the requirement to reassess the lease classification for any existing leases prior to our adoption of ASU 2016-02 on January 1, 2019. Operating lease right-of-use assets and operating lease liabilities are discounted using our incremental borrowing rate, since the implicit rate is not readily determinable. We do not currently have any financing leases. Operating lease costs are recorded on a straight-line basis within other store expenses in our Consolidated Statements of Operations. Total operating lease costs by expense type: Twelve Months Ended (in thousands) December 31, 2021 December 31, 2020 December 31, 2019 Operating lease cost included in other store expenses (1)(2) $ 129,217 $ 140,186 $ 148,314 Operating lease cost included in other charges (2) 302 1,236 9,222 Sublease receipts (11,806) (9,727) (7,683) Total operating lease charges $ 117,713 $ 131,695 $ 149,853 (1) Includes short-term lease costs, which are not significant. (2) Excludes variable lease costs of $33.7 million and $34.6 million for the twelve months ended December 31, 2021 and 2020, respectively. Supplemental cash flow information related to leases: Twelve Months Ended (in thousands) December 31, 2021 December 31, 2020 December 31, 2019 Cash paid for amounts included in measurement of operating lease liabilities $ 107,588 $ 113,243 $ 120,826 Cash paid for short-term operating leases not included in operating lease liabilities 17,266 22,339 27,402 Right-of-use assets obtained in exchange for new operating lease liabilities 100,779 104,771 78,250 Weighted-average discount rate and weighted-average remaining lease term: (in thousands) December 31, 2021 December 31, 2020 December 31, 2019 Weighted-average discount rate (1) 6.0 % 6.8 % 7.7 % Weighted-average remaining lease term (in years) 4 4 4 (1) January 1, 2019 incremental borrowing rate was used for leases in existence at the time of adoption of ASU 2016-02. Reconciliation of undiscounted operating lease liabilities to the present value operating lease liabilities at December 31, 2021: (In thousands) Operating Leases 2022 $ 106,505 2023 83,248 2024 64,693 2025 47,248 2026 23,077 Thereafter 17,266 Total undiscounted operating lease liabilities 342,037 Less: Interest (45,502) Total present value of operating lease liabilities $ 296,535 In response to the COVID-19 pandemic and related government restrictions negatively impacting our operations, we renegotiated certain store lease agreements in the second quarter of 2020 to obtain rent relief in the near term, in order to help offset the negative financial impacts of COVID-19. Renegotiations included approximately 500 lease agreements, receiving near term rent abatements of approximately $2.3 million and rent deferrals of approximately $2.1 million. As of December 31, 2021, the vast majority of COVID rent deferrals have been repaid. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Acquisitions [Text Block] | Goodwill and Other Intangible Assets Goodwill In the fourth quarter of 2021, we completed a qualitative assessment for impairment of goodwill as of October 1, 2021, concluding it was not more likely than not that the carrying value of the net assets of our reporting units exceeded their respective fair values and therefore no impairment of goodwill existed as of December 31, 2021. At December 31, 2021 and 2020, the amount of goodwill attributable to the Rent-A-Center Business segment was approximately $1.5 million. At December 31, 2021 and 2020, the amount of goodwill attributable to the Acima segment was $288.3 million and $68.7 million, respectively. A summary of the changes in recorded goodwill follows: Year Ended December 31, (In thousands) 2021 2020 Beginning goodwill balance $ 70,217 $ 70,217 Additions from acquisitions 241,774 — Post purchase price allocation adjustments (22,241) — Ending goodwill balance $ 289,750 $ 70,217 Other Intangible Assets Amortizable intangible assets consist of the following: December 31, 2021 December 31, 2020 (Dollar amounts in thousands) Avg. Life (years) Gross Accumulated Gross Accumulated Customer relationships (1) 2 $ 140,039 $ 132,127 $ 80,008 $ 79,853 Merchant relationships 10 389,760 35,960 9,760 2,046 Trade Name 7 40,000 4,966 — — Non-compete agreements 3 46,719 18,307 6,719 6,719 Total other intangible assets $ 616,518 $ 191,360 $ 96,487 $ 88,618 (1) Includes acquired Relationships with Existing Lessees from Acima Holdings with a remaining useful life of 1 year from the date of acquisition, February 17, 2021. Aggregate amortization expense (in thousands): Year Ended December 31, 2021 $ 102,742 Year Ended December 31, 2020 $ 1,070 Year Ended December 31, 2019 $ 723 Estimated amortization expense, assuming current intangible balances and no new acquisitions, for each of the years ending December 31, is as follows: (In thousands) Estimated 2022 $ 65,850 2023 57,938 2024 46,350 2025 44,604 2026 44,604 Thereafter 165,812 Total amortization expense $ 425,158 |
Accrued Liabilities (Notes)
Accrued Liabilities (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Accrued Liabilities [Abstract] | |
Accrued liabilities [Text Block] | Accrued Liabilities December 31, (In thousands) 2021 2020 Accrued insurance costs $ 89,621 $ 94,744 Deferred revenue 71,376 61,066 Taxes other than income 49,708 48,038 Accrued compensation 46,750 48,027 Accrued dividends 27,801 17,003 Accrued legal settlement 22,500 5,440 Accrued interest payable 11,993 1,041 Deferred compensation 10,349 9,437 Accrued other 32,610 35,787 Total Accrued liabilities $ 362,708 $ 320,583 |
Income Taxes (Notes)
Income Taxes (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes [Abstract] | |
Income Taxes [Text Block] | Income Taxes For financial statement purposes, earnings before income taxes by source was comprised of the following: Year Ended December 31, (In thousands) 2021 2020 2019 Domestic $ 176,042 $ 212,859 $ 212,406 Foreign 18,262 9,920 11,377 Earnings before income taxes $ 194,304 $ 222,779 $ 223,783 A reconciliation of the federal statutory rate of 21% to the effective rate follows: Year Ended December 31, 2021 2020 2019 Tax at statutory rate 21.0 % 21.0 % 21.0 % Stock compensation 11.6 % — % — % State income taxes 7.4 % 2.8 % 4.3 % Effect of foreign operations 2.0 % (0.3) % 0.3 % Effect of current and prior year credits (2.4) % (0.8) % (2.7) % Change in unrecognized tax benefits (2.8) % 0.3 % — % Other permanent differences 0.3 % (0.7) % 0.2 % Prior year return to provision adjustments (0.2) % 1.1 % (2.7) % Benefit of CARES Act — % (7.5) % — % Valuation allowance (7.1) % (9.3) % 1.2 % Other, net 0.8 % — % 0.8 % Effective income tax rate 30.6 % 6.6 % 22.4 % The components of income tax expense (benefit) are as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Current expense (benefit) Federal $ (7,398) $ 14,354 $ (6,996) State 15,106 4,735 528 Foreign 3,690 1,608 796 Total current 11,398 20,697 (5,672) Deferred expense (benefit) Federal 56,716 12,576 37,309 State (1,205) (2,956) 16,439 Foreign (7,545) (15,653) 2,161 Total deferred 47,966 (6,033) 55,909 Total income tax expense (benefit) $ 59,364 $ 14,664 $ 50,237 Deferred tax assets (liabilities) consist of the following: December 31, (In thousands) 2021 2020 Deferred tax assets Net operating loss carryforwards $ 35,834 $ 32,834 Accrued liabilities 48,659 45,776 Intangible assets 165,135 9,676 Lease obligations 73,819 67,999 Other assets including credits 12,157 10,079 Foreign tax credit carryforwards 7,696 5,643 Total deferred tax assets 343,300 172,007 Valuation allowance (7,688) (21,645) Deferred tax assets, net 335,612 150,362 Deferred tax liabilities Rental merchandise (288,504) (206,833) Property assets (20,094) (18,935) Lease assets (72,458) (66,661) Other liabilities (108) (561) Total deferred tax liabilities (381,164) (292,990) Net deferred taxes $ (45,552) $ (142,628) At December 31, 2021, we had net operating loss carryforwards of approximately $239 million for state, $37 million for federal and $52 million for foreign jurisdictions. State net operating losses were partially offset by a valuation allowance. We also had federal, state and foreign tax credit carryforwards of approximately $15.6 million of which a portion has been offset by a valuation allowance. The net operating losses and credits will expire in various years between 2022 and 2041. We file income tax returns in the U.S. and multiple foreign jurisdictions with varying statutes of limitations. In the normal course of business, we are subject to examination by various taxing authorities. We are currently under examination by certain Federal and state revenue authorities for the fiscal years 2012 through 2019. The following is a summary of all tax years that are open to examination. • U.S. Federal - 2013 and forward • U.S. States - 2011 and forward • Foreign - 2013 and forward We do not anticipate that adjustments as a result of these audits, if any, will have a material impact to our Consolidated Statement of Operations, Consolidated Balance Sheets, and statement of cash flows or earnings per share. As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact management’s view with regard to future realization of deferred tax assets. After review of the positive evidence generated during the year, we have determined no valuation allowance is required against Mexico net operating losses. A valuation allowance is still required related to certain tax credits and certain state net operating losses. A reconciliation of the beginning and ending amount of unrecognized tax benefits follows: Year Ended December 31, (In thousands) 2021 2020 2019 Beginning unrecognized tax benefit balance $ 22,184 $ 24,208 $ 36,364 Additions (Reductions) based on tax positions related to current year 461 1,204 (654) Additions for tax positions of prior years 4,119 45 415 Reductions for tax positions of prior years (3,006) (2,086) (11,917) Settlements (17,222) (1,187) — Ending unrecognized tax benefit balance $ 6,536 $ 22,184 $ 24,208 Included in the balance of unrecognized tax benefits at December 31, 2021, is $2.2 million, net of federal benefit, which, if ultimately recognized, will affect our annual effective tax rate. During the year ended December 31, 2021, we recorded $2.6 million of interest income primarily related to the reversal of the accrual of interest for matters settled during the year in our favor, partially offset by interest expense of $1.2 million for remaining uncertain tax positions, both of which are excluded from the reconciliation of unrecognized tax benefits presented above. The effect of the tax rate change for items originally recognized in other comprehensive income was properly recorded in tax expense from continuing operations. This results in stranded tax effects in accumulated other comprehensive income at December 31, 2021. Companies can make a policy election to reclassify from accumulated other comprehensive income to retained earnings the stranded tax effects directly arising from the change in the federal corporate tax rate. We did not exercise the option to reclassify stranded tax effects within accumulated other comprehensive income in each period in which the effect of the change in the U.S. federal corporate income tax rate resulting from the Tax Cuts and Jobs Act of 2017 was recorded. |
Senior Debt (Notes)
Senior Debt (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Senior Debt [Abstract] | |
Debt Disclosure [Text Block] | Senior Debt On February 17, 2021, we entered into a credit agreement with JPMorgan Chase Bank, N.A., as administrative agent, and lenders party thereto, providing for a seven-year $875 million senior secured term loan facility (the “Term Loan Facility”) and an Asset Based Loan Credit Facility (the “ABL Credit Facility”) providing for a five-year asset-based revolving credit facility with commitments of $550 million and a letter of credit sublimit of $150 million. Commitments under the ABL Credit Facility may be increased, at our option and under certain conditions, by up to an additional $125 million in the aggregate. Proceeds from the Term Loan Facility were net of original issue discount of $4.4 million upon issuance from the lenders. In addition, in connection with the closing of the Term Loan Facility and the ABL Credit Facility, we incurred approximately $30.2 million in debt issuance costs, including bank financing fees and third party legal and other professional fees, of which $25.3 million was capitalized in accordance with ASC Topic 470, “Debt” and recorded as a reduction of our outstanding senior debt, net in our Consolidated Balance Sheets. Remaining debt issuance costs incurred of $4.9 million were expensed and recorded to Other charges (gains) in our Consolidated Statement of Operations. On September 21, 2021 we entered into a First Amendment (the “First Amendment”) to the Term Loan Facility, effective as of September 21, 2021. The amendment effected a repricing of the applicable margin under the Term Loan Facility by reducing the LIBOR floor by 25 basis points from 0.75% to 0.50%, and the applicable margin, with respect to any initial term loans, by 75 basis points from 4.00% to 3.25%. In connection with the execution of the First Amendment, we incurred approximately $1.5 million in debt issuance costs, including third party arrangement and other professional fees, of which approximately $1.4 million were expensed as debt refinance charges in our Consolidated Statement of Operations, and approximately $0.1 million were capitalized and recorded as a reduction to our outstanding senior debt in our Consolidated Balance Sheets. In addition, in accordance with ASC Topic 470, “Debt”, we recorded approximately $5.4 million in write-offs of unamortized debt issuance costs and original issue discount previously capitalized upon the issuance of the Term Loan Facility on February 17, 2021. The write-offs were recorded as debt refinance charges in our Consolidated Statement of Operations. As of December 31, 2021, the total remaining balance of unamortized debt issuance costs and original issue discount related to our senior debt reported in the Consolidated Balance Sheets were approximately $20.3 million and $2.9 million, respectively. Remaining unamortized debt issuance costs and original issue discount will be amortized to interest expense over the remaining term of the Term Loan Facility. The amount outstanding under the Term Loan Facility was $868.4 million at December 31, 2021. We had $290.0 million outstanding borrowings under our ABL Credit Facility at December 31, 2021 and borrowing capacity of $173.6 million. We also utilize the ABL Credit Facility for the issuance of letters of credit. As of December 31, 2021, we have issued letters of credit in the aggregate outstanding amount of $86.4 million primarily relating to workers compensation insurance claims. The senior debt facilities as of December 31, 2021 and 2020 are as follows: December 31, 2021 December 31, 2020 (In thousands) Facility Maximum Amount Amount Maximum Amount Amount Senior Debt: Term Loan Facility February 17, 2028 $ 875,000 $ 868,438 $ — $ — $ — $ — ABL Credit Facility (1) February 17, 2026 550,000 290,000 173,616 300,000 — 209,268 Prior Term Loan Facility — — — 200,000 197,500 — Total $ 1,425,000 1,158,438 $ 173,616 $ 500,000 197,500 $ 209,268 Unamortized debt issuance costs (23,231) (7,010) Total senior debt, net $ 1,135,207 $ 190,490 (1) Borrowing availability is net of issued letters of credit of approximately $86.4 million and $90.7 million for the years ended December 31, 2021 and 2020, respectively Term Loan Credit Agreement The Term Loan Facility, which matures on February 17, 2028, amortizes in equal quarterly installments at a rate of 1.00% per annum of the original principal amount thereof, with the remaining balance due at final maturity. Subject in each case to certain restrictions and conditions, we may add up to $500 million of incremental term loan facilities to the Term Loan Facility or utilize incremental capacity under the Term Loan Facility at any time by issuing or incurring incremental equivalent term debt. Interest on borrowings under the Term Loan Facility is payable at a fluctuating rate of interest determined by reference to the eurodollar rate plus an applicable margin of 3.25%, subject to a 0.50% LIBOR floor. Borrowings under the Term Loan Facility amortize in equal quarterly installments in an amount equal to 1.000% per annum of the original aggregate principal amount thereof, with the remaining balance due at final maturity. The Term Loan Facility is secured by a first-priority security interest in substantially all of our present and future tangible and intangible personal property, including our subsidiary guarantors, other than the ABL Priority Collateral (as defined below), and by a second-priority security interest in the ABL Priority Collateral, subject to certain exceptions. The obligations under the Term Loan Facility are guaranteed by us and our material wholly-owned domestic restricted subsidiaries that also guarantee the ABL Credit Facility. The Term Loan Facility contains covenants that are usual and customary for similar facilities and transactions and that, among other things, restrict our ability and our restricted subsidiaries to create certain liens and enter into certain sale and lease-back transactions; create, assume, incur or guarantee certain indebtedness; consolidate or merge with, or convey, transfer or lease all or substantially all of our and our restricted subsidiaries’ assets, to another person; pay dividends or make other distributions on, or repurchase or redeem, our capital stock or certain other debt; and make other restricted payments. The Term Loan Facility also includes mandatory prepayment requirements related to asset sales (subject to reinvestment), debt incurrence (other than permitted debt) and excess cash flow, subject to certain limitations described therein. These covenants are subject to a number of limitations and exceptions set forth in the documentation governing the Term Loan. The Term Loan provides for customary events of default, including, but not limited to, failure to pay principal and interest, failure to comply with covenants, agreements or conditions, and certain events of bankruptcy or insolvency involving us and our significant subsidiaries. The Term Loan Facility was fully drawn at the closing of the Acima Holdings acquisition to fund a portion of the Aggregate Cash Consideration payable in the transaction, repay certain of our outstanding indebtedness and that of our subsidiaries, repay all outstanding indebtedness of Acima Holdings and its subsidiaries and pay certain fees and expenses incurred in connection with the transaction. A portion of such proceeds were used to repay $197.5 million outstanding under the prior term loan facility, dated as of August 5, 2019, among us, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto (the “Prior Term Loan Facility”). ABL Credit Agreement The ABL Credit Facility will mature on February 17, 2026. We may borrow only up to the lesser of the level of the then-current borrowing base and the aggregate amount of commitments under the ABL Credit Facility. The borrowing base is tied to the amount of eligible installment sales accounts, inventory and eligible rental contracts, reduced by certain reserves. The ABL Credit Facility bears interest at a fluctuating rate determined by reference to the eurodollar rate plus an applicable margin of 1.50% to 2.00%. The total interest rate on the ABL Credit Facility at December 31, 2021 was 1.875%. A commitment fee equal to 0.250% to 0.375% of the unused portion of the ABL Credit Facility fluctuates dependent upon average utilization for the prior month as defined by a pricing grid included in the documentation governing the ABL Credit Facility. The commitment fee at December 31, 2021 was 0.375%. We paid $0.8 million of commitment fees during the fourth quarter of 2021. Loans under the ABL Credit Facility may be borrowed, repaid and re-borrowed until February 17, 2026, at which time all amounts borrowed must be repaid. The obligations under the ABL Credit Facility are guaranteed by us and certain of our wholly owned domestic restricted subsidiaries, subject to certain exceptions. The obligations under the ABL Credit Facility and such guarantees are secured on a first-priority basis by all of our and our subsidiary guarantors’ accounts, inventory, deposit accounts, securities accounts, cash and cash equivalents, rental agreements, general intangibles (other than equity interests in our subsidiaries), chattel paper, instruments, documents, letter of credit rights, commercial tort claims related to the foregoing and other related assets and all proceeds thereof related to the foregoing, subject to permitted liens and certain exceptions (such assets, collectively, the “ABL Priority Collateral”) and a second-priority basis in substantially all other present and future tangible and intangible personal property of ours and the subsidiary guarantors, subject to certain exceptions. The ABL Credit Facility contains covenants that are usual and customary for similar facilities and transactions and that, among other things, restrict our ability and our restricted subsidiaries to create certain liens and enter into certain sale and lease-back transactions; create, assume, incur or guarantee certain indebtedness; consolidate or merge with, or convey, transfer or lease all or substantially all of our and our restricted subsidiaries’ assets, to another person; pay dividends or make other distributions on, or repurchase or redeem, our capital stock or certain other debt; and make other restricted payments. The ABL Credit Facility also requires the maintenance of a consolidated fixed charge coverage ratio of 1.10 to 1.00 at the end of each fiscal quarter when either (i) certain specified events of default have occurred and are continuing or (ii) availability is less than or equal to the greater of $56.25 million and 15% of the line cap then in effect. These covenants are subject to a number of limitations and exceptions set forth in the documentation governing the ABL Credit Facility. The fixed charge coverage ratio as of December 31, 2021 was 1.07 to 1.00, however, there were no events of default and our borrowing availability remains above the line cap in effect. Therefore, as of December 31, 2021 we are not subject to any restrictions as described above. The documentation governing the ABL Credit Facility provides for customary events of default, including, but not limited to, failure to pay principal and interest, failure to comply with covenants, agreements or conditions, and certain events of bankruptcy or insolvency involving us and our significant subsidiaries. The table below shows the scheduled maturity dates of our outstanding debt at December 31, 2021 for each of the years ending December 31: (in thousands) Term Loan Facility ABL Credit Facility Total 2022 $ 8,750 $ — $ 8,750 2023 8,750 — 8,750 2024 8,750 — 8,750 2025 8,750 — 8,750 2026 8,750 290,000 298,750 Thereafter 824,688 — 824,688 Total senior debt $ 868,438 $ 290,000 $ 1,158,438 |
Senior Notes (Notes)
Senior Notes (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Subsidiary Guarantors - Senior Notes [Abstract] | |
Subsidiary Guarantors Senior Notes [Text Block] | Senior Notes On February 17, 2021, we issued $450 million in senior unsecured notes due February 15, 2029, at par value, bearing interest at 6.375% (the “Notes”), the proceeds of which were used to fund a portion of the Aggregate Cash Consideration upon closing of the Acima Holdings acquisition. Interest on the Notes is payable in arrears on February 15 and August 15 of each year, beginning on August 15, 2021. In connection with the issuance of the Notes, we incurred approximately $15.7 million in debt issuance costs, including bank financing fees and third party legal and other professional fees, which were capitalized in accordance with ASC Topic 470, “Debt” and recorded as a reduction of our outstanding Notes in our Consolidated Balance Sheets. Debt issuance costs will be amortized as interest expense over the term of the Notes. We may redeem some or all of the Notes at any time on or after February 15, 2024 for cash at the redemption prices set forth in the indenture governing the Notes, plus accrued and unpaid interest to, but not including, the redemption date. Prior to February 15, 2024, we may redeem up to 40% of the aggregate principal amount of the Notes with the proceeds of certain equity offerings at a redemption price of 106.375% plus accrued and unpaid interest to, but not including, the redemption date. In addition, we may redeem some or all of the Notes prior to February 15, 2024, at a redemption price of 100% of the principal amount of the Notes plus accrued and unpaid interest to, but not including, the redemption date, plus a “make-whole” premium. If we experience specific kinds of change of control, we will be required to offer to purchase the Notes at a price equal to 101% of the principal amount thereof plus accrued and unpaid interest. The Notes are our general unsecured senior obligations, and are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness, structurally subordinated to all existing and future indebtedness and other liabilities of our non-guarantor subsidiaries, equal in right of payment to all of our and our guarantor subsidiaries’ existing and future senior indebtedness and senior in right of payment to all of our future subordinated indebtedness, if any. The Notes are jointly and severally guaranteed on a senior unsecured basis by certain of our domestic subsidiaries that have outstanding indebtedness or guarantee other specified indebtedness, including the ABL Credit Facility and the Term Loan Facility. The indenture governing the Notes contains covenants that limit, among other things, our ability and the ability of some of our restricted subsidiaries to create liens, transfer or sell assets, incur indebtedness or issue certain preferred stock, pay dividends, redeem stock or make other distributions, make other restricted payments or investments, create restrictions on payment of dividends or other amounts to us by our restricted subsidiaries, merge or consolidate with other entities, engage in certain transactions with affiliates and designate our subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of exceptions and qualifications. The covenants limiting restricted payments, restrictions on payment of dividends or other amounts to us by our restricted subsidiaries, the ability to incur indebtedness, asset dispositions and transactions with affiliates will be suspended if and while the Notes have investment grade ratings from any two of Standard & Poor’s Ratings Services, Moody’s Investors Service, Inc. and Fitch, Inc. The indenture governing the Notes also provides for events of default, which, if any of them occurs, would permit or require the principal, premium, if any, and interest on all the then outstanding Notes to be due and payable. |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies [Abstract] | |
Contingencies Disclosure [Text Block] | Contingencies From time to time, we, along with our subsidiaries, are party to various legal proceedings and governmental inquiries arising in the ordinary course of business. We reserve for loss contingencies that are both probable and reasonably estimable. We regularly monitor developments related to these legal proceedings, and review the adequacy of our legal reserves on a quarterly basis. We do not currently expect these losses to have a material impact on our consolidated financial statements if and when such losses are incurred. Nevertheless, we cannot predict the impact of future developments affecting our claims and lawsuits, and any resolution of a claim or lawsuit or reserve within a particular fiscal period may materially and adversely impact our results of operations for that period. In addition, claims and lawsuits against us may seek injunctive or other relief that requires changes to our business practices or operations and it is possible that any required changes may materially and adversely impact our business, financial condition, results of operations or reputation. Unclaimed Property. We are subject to unclaimed property audits by states in the ordinary course of business. The property subject to review in the audit process includes unclaimed wages, vendor payments and customer refunds. State escheat laws generally require entities to report and remit abandoned and unclaimed property to the state. Failure to timely report and remit the property can result in assessments that could include interest and penalties, in addition to the payment of the escheat liability itself. We routinely remit escheat payments to states and believe we are in compliance with applicable escheat laws. Acima Consumer Financial Protection Bureau investigation. Prior to the execution of the definitive agreement to acquire Acima Holdings, Acima Holdings received a Civil Investigative Demand dated October 1, 2020 (the “CID”) from the Consumer Financial Protection Bureau (the “CFPB”) requesting certain information, documents and data relating to Acima Holding’s products, services and practices for the period from January 1, 2015 to the date on which responses to the CID are provided in full. The purpose of the CID is to determine whether Acima Holdings extends credit, offers leases, or otherwise offers or provides a consumer financial product or service and whether Acima Holdings complies with certain consumer financial protection laws. We are fully cooperating with the CFPB investigation and are continuing to produce records in response to requests of the CFPB. The CFPB has not made any allegations in the investigation, and we are currently unable to predict the eventual scope, ultimate timing or outcome of the CFPB investigation. On the terms and subject to the conditions set forth in the definitive agreement to acquire Acima Holdings, the former owners of Acima Holdings have agreed to indemnify Rent-A-Center for certain losses arising after the consummation of the transaction with respect to the CID and certain pre-closing taxes. The indemnification obligations of the former owners of Acima Holdings are limited to an indemnity holdback in the aggregate amount of $50 million, which was escrowed at the closing of the transaction, and will be Rent-A-Center’s sole recourse against the former owners of Acima Holdings with respect to all of the indemnifiable claims under the definitive transaction agreement. Other than with respect to any pending or unresolved claims for indemnification submitted by Rent-A-Center prior to such time, and subject to other limited exceptions, the escrowed amount will be released to the former owners of Acima Holdings as follows: (i) in respect of the CID, on the earlier of February 17, 2024 and the date on which a final determination is entered providing for a resolution of the matters regarding the CID and (ii) in respect of certain pre-closing taxes, on August 18, 2022, the first business day following the date that is 18 months after the closing date of the transaction. There can be no assurance that the CID will be finally resolved prior to the release to the former owners of Acima Holdings of the escrowed funds reserved therefor, or that such escrowed amount will be sufficient to address all covered losses or that the CFPB’s ongoing investigation or future exercise of its enforcement, regulatory, discretionary or other powers will not result in findings or alleged violations of consumer financial protection laws that could lead to enforcement actions, proceedings or litigation, whether by the CFPB, other state or federal agencies, or other parties, and the imposition of damages, fines, penalties, restitution, other monetary liabilities, sanctions, settlements or changes to Acima Holdings’ business practices or operations that could materially and adversely affect our business, financial condition, results of operations or reputation. California Attorney General. The California Attorney General (the “CAG”) issued an investigative subpoena in 2018 seeking information with respect to certain of our Acceptance Now business practices (now part of the Acima segment). Since receiving such demand, we have cooperated with the CAG in connection with its investigation and made several productions of requested documents. In March 2020, the CAG put forth proposed settlement terms to address alleged violations of California law. The CAG’s allegations include those with respect to certain consumer fees, charges and communications in connection with our lease-to-own transactions. The CAG’s proposed settlement terms include civil penalties, disgorgement of certain revenues, additional training requirements, and changes to certain business practices. In November 2021, the parties reached an agreement in principle regarding the potential resolution of this matter. Final settlement remains subject to the negotiation and execution of applicable documentation. We are currently unable to predict the ultimate timing of entering binding settlement documentation, and it remains possible that the parties will be unable to agree on the settlement documentation. Massachusetts Attorney General. The Massachusetts Attorney General (the “MAG”) issued a civil investigative demand in 2018 seeking information with respect to certain of our business practices, including regarding account management and certain other business practices in connection with our lease-to-own transactions. Since receiving such demand, we have cooperated with the MAG in connection with its investigation. In June 2021, the MAG provided us with proposed settlement terms including a monetary payment, injunctive provisions regarding certain business practices and compliance requirements. We are continuing to cooperate with the MAG and to discuss resolution of the inquiry with the MAG. We are currently unable to predict the ultimate timing or outcome of the MAG investigation. State Attorneys General Investigation. On November 1, 2021, Acima received a letter from the Nebraska Attorney General’s office stating that the Attorney General of Nebraska, along with a coalition of thirty-eight state Attorneys General, initiated a multistate investigation into the business acts and practices of Acima and that a civil investigative demand(s) and/or subpoena(s) pursuant to respective state consumer protection laws will be forthcoming. Since receiving the letter, we have held multiple discussions with officials at the lead attorneys general offices and, based on those discussions, it is our understanding that the investigation is looking at business practices within the virtual lease-to-own industry and includes or will include multiple companies. Acima is cooperating with the investigation process. As of the date of filing this Form 10-K, we have not yet received a civil investigative demand or subpoena and no specific allegations have been made against Acima pursuant to the investigation. We are currently unable to predict the eventual scope, timing or outcome of this matter. |
Other Charges and (Gains) (Note
Other Charges and (Gains) (Notes) | 12 Months Ended |
Dec. 31, 2020 | |
Other Charges - Operating Expenses [Abstract] | |
Other (Gains) and Charges [Text Block] | Other Charges (Gains) Acima Holdings Acquisition. As described in Note B, on February 17, 2021, we completed the acquisition of Acima Holdings, a leading provider of virtual lease-to-own solutions. Included in the aggregate consideration issued to the former owners of Acima Holdings were 8,096,595 common shares, valued at $414.1 million, subject to 36-month vesting conditions under restricted stock agreements, which will be recognized over the vesting term as stock compensation expense. During 2021, we recognized approximately $127.1 million in stock compensation expense related to these restricted stock agreements. The fair value of assets acquired as part of the transaction included $520 million in intangible assets and $170 million in developed technology. During 2021, we recognized approximately $101.7 million in amortization expense and $13.2 million in incremental depreciation expense related to these assets. Furthermore, during 2021 we recognized approximately $17.7 million in transaction costs associated with the closing of the transaction, and approximately $10.3 million in post-acquisition integration costs, including $5.1 million in inventory losses, $3.7 million in employee severance, and $1.5 million in other integration costs, including reorganization advisory fees. During 2020, we recorded approximately $6.4 million in expenses related to the acquisition, primarily consisting of legal and other professional fees. Store Consolidations. During 2020, we closed 28 Rent-A-Center Business stores, resulting in pre-tax charges of $1.5 million in other miscellaneous shutdown and holding costs, $0.4 million in lease impairment charges, $0.1 million in disposal of fixed assets, and $0.1 million in severance and other payroll-related costs. Cost Savings Initiatives. During 2018, we began the execution of multiple cost savings initiatives, including reductions in overhead and supply chain operations. In connection with these initiatives, we recorded pre-tax charges during 2020 consisting of $0.8 million in severance and other payroll-related costs, $0.4 million in lease impairment charges, and $0.4 million in other miscellaneous shutdown and holding costs. COVID-19 Pandemic. In March 2020, national efforts to contain the COVID-19 virus began to be implemented. In connection with COVID-19, during 2020, we incurred approximately $1.4 million in sanitization cleaning and personal protective equipment expenses, $0.4 million in payroll-related costs, and $0.2 million in lease expense related to closed stores and idled vehicles, partially offset by real estate lease abatement credits of $0.8 million for our Rent-A-Center Business stores. Social Unrest. During the second quarter of 2020, we incurred expenses resulting from certain civil unrest that occurred in connection with efforts to institute law enforcement and other social and political reforms. In connection with this unrest, approximately 30 Rent-A-Center Business stores were looted and/or damaged, resulting in $0.9 million of inventory write-offs and less than $0.1 million in disposal of fixed assets during 2020. California Refranchise Sale . On October 5, 2020, we sold all 99 Rent-A-Center Business corporate stores in the state of California to an experienced franchisee. We received cash consideration of approximately $16 million, including approximately $1 million paid for related franchise fees. The sale included idle and on-rent inventory of approximately $30.0 million and property assets of approximately $0.8 million, resulting in a total loss on sale of approximately $16.6 million. Activity with respect to Other charges for the years ended December 31, 2020 and 2021 is summarized in the below table: (In thousands) Accrued Charges at December 31, 2019 Charges & Adjustments Payments & Adjustments Accrued Charges at December 31, 2020 Charges & Adjustments Payments & Adjustments Accrued Charges at December 31, 2021 Cash: Acima Holdings transaction costs $ — $ 6,400 $ (1,395) $ 5,005 $ 17,680 $ (22,685) $ — Acima Holdings integration costs — — — — 6,572 (6,572) — Labor reduction costs 738 1,334 (1,728) 344 3,751 (2,502) 1,593 Lease obligation costs (1) — (645) 645 — — — — Contract termination costs — — — — — — — Other cash charges (2) — 1,889 (1,889) — 658 (658) — Total cash charges $ 738 8,978 $ (4,367) $ 5,349 28,661 $ (32,417) $ 1,593 Non-cash: Acima Holdings restricted stock agreements (3) — 127,060 Depreciation and amortization of acquired assets (4) — 114,959 Asset impairments (5) 2,749 1,572 Rental merchandise losses (6) 860 — Other (7) 23,968 17,661 Total other charges $ 36,555 $ 289,913 (1) Includes lease abatement credits in 2020 related to renegotiated lease agreements in response to COVID-19. (2) Represents shutdown and holding expenses related to store closures. (3) Represents stock compensation expense recognized in 2021, related to common stock issued to Acima Holdings employees under restricted stock agreements as part of the acquisition consideration subject to vesting restrictions, as described in Note B and Note O. (4) Represents amortization of the total fair value of acquired intangible assets and incremental depreciation related to the fair value increase over net book value of acquired software assets in connection with the acquisition of Acima Holdings as described in Note B. (5) Asset impairments primarily includes store damage related to Hurricane Ida in 2021. Asset impairments in 2020 primarily include impairments of operating lease right-of-use assets and other property assets related to the closure of Rent-A-Center Business stores and previously closed product service centers, store damage related to looting, as well as a write-down of capitalized software. (6) Reflects merchandise losses due to looting. (7) Includes $17.5 million in legal settlement reserves and $0.2 million in state sales tax assessment reserves for 2021. Amounts accrued for potential settlements do not represent our maximum loss exposure. The amount of any loss ultimately incurred in relation to matters for which an accrual has been established may be significantly different than the amounts accrued for such matters due to the inherent uncertainty in litigation, regulatory and similar adversarial proceedings. For 2020, primarily includes a $16.6 million loss on the sale of our stores in California, $7.9 million for legal settlement reserves, $1.2 million for state tax audit assessment reserves, $1.4 million in expenses related to COVID-19, partially offset by $2.8 million in proceeds received from the sale of a class action claim and $0.3 million in insurance proceeds related to Hurricane Maria in 2017 for the year ended December 31, 2020. |
Stock-Based Compensation (Notes
Stock-Based Compensation (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation [Text Block] | Stock-Based Compensation We maintain long-term incentive plans for the benefit of certain employees and directors. Our plans consist of the Rent-A-Center, Inc. 2021 Long-Term Incentive Plan (the “2021 Plan”), the Rent-A-Center 2016 Long-Term Incentive Plan (the “2016 Plan”), the Rent-A-Center, Inc. 2006 Long-Term Incentive Plan (the “2006 Plan”), and the Rent-A-Center, Inc. 2006 Equity Incentive Plan (the “Equity Incentive Plan”), which are collectively known as the “Plans.” All Plans prior to the 2021 Plan were previously expired upon approval of the superseding Plan, and any shares available for grant under the respective plans were canceled at the time of expiration. On June 8, 2021, at the 2021 Annual Meeting of Stockholders, the stockholders approved the 2021 Plan. The 2021 Plan authorizes the issuance of a total of 5,000,000 shares of common stock. Any shares of common stock granted in connection with an award of stock options or stock appreciation rights will be counted against this limit as one share and any shares of common stock granted in connection with awards of restricted stock, restricted stock units, deferred stock or similar forms of stock awards other than stock options and stock appreciation rights will be counted against this limit as two shares of common stock for every one share of common stock granted in connection with such awards. No shares of common stock will be deemed to have been issued if (1) such shares covered by the unexercised portion of an option that terminates, expires, or is cancelled or settled in cash or (2) such shares are forfeited or subject to awards that are forfeited, canceled, terminated or settled in cash. In any calendar year, (1) no employee will be granted options and/or stock appreciation rights for more than 800,000 shares of common stock; (2) no employee will be granted performance-based equity awards under the 2021 Plan (other than options and stock appreciation rights), covering more than 800,000 shares of common stock. At December 31, 2021, there were 100,822 shares allocated to equity awards outstanding in the 2021 Plan. Under the previously expired 2016 Plan, there were 2,184,396 and 2,767,703 shares, respectively, allocated to equity awards outstanding as of December 31, 2021 and 2020, respectively, in the 2016 Plan. The 2016 Plan expired on June 8, 2021 upon approval of the 2021 Plan. Under the previously expired 2006 Plan and Equity Incentive Plan (formerly known as the Rent-Way, Inc. 2006 Equity Incentive Plan) there were 83,757 and 263,657 shares as of December 31, 2021 and 2020, respectively, allocated to outstanding equity awards under the 2006 Plan, and 63,065 and 231,454 shares as of December 31, 2021 and 2020, respectively, allocated to outstanding equity awards under the Equity Incentive Plan. The 2006 Plan and Equity Incentive Plan previously expired in 2016. Outstanding equity awards under these plans represent vested options that will expire at various times through 2026, unless exercised or canceled prior to the expiration date. Options granted to our employees generally become exercisable over a period of 1 to 4 years from the date of grant and may be exercised up to a maximum of 10 years from the date of grant. Options granted to directors are immediately exercisable. We grant restricted stock units to certain employees that vest ratably over a three-year service period. We recognize expense for these awards using the straight-line method over the requisite service period based on the number of awards expected to vest. We also grant performance-based restricted stock units that vest between 0% and 200% depending on our stock performance against an index using a total shareholder return formula established at the date of grant for the subsequent three-year period. We record expense for these awards over the requisite service period, net of the expected forfeiture rate, since the employee must maintain employment to vest in the award. Stock-based compensation expense for the years ended December 31, 2021, 2020 and 2019 is as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Stock options $ 2,001 $ 1,878 $ 1,273 Restricted share units (1) 145,553 10,406 5,685 Total stock-based compensation expense 147,554 12,284 6,958 Tax benefit recognized in the statements of earnings 58,963 3,062 1,562 Stock-based compensation expense, net of tax $ 88,591 9,222 $ 5,396 (1) Includes $127.1 million in stock compensation expense related to 8,096,595 common shares issued to the former owners of Acima, as part of the Aggregate Stock Consideration subject to restricted stock agreements, and recorded to Other charges in our Consolidated Statements of Operations. See Note B and Note N for additional information. We issue new shares of stock to satisfy option exercises and the vesting of restricted stock units. The fair value of unvested options that we expect to result in compensation expense was approximately $3.3 million with a weighted average number of years to vesting of 2.27 at December 31, 2021. Information with respect to stock option activity related to the Plans for the year ended December 31, 2021 follows: Equity Awards Weighted Average Weighted Average Aggregate Intrinsic Balance outstanding at January 1, 2021 1,658,165 $ 22.91 Granted 97,250 45.37 Exercised (476,398) 25.30 Forfeited (138,237) 31.45 Expired (19,291) 29.19 Balance outstanding at December 31, 2021 1,121,489 $ 22.68 6.70 $ 29,691 Exercisable at December 31, 2021 525,801 $ 19.65 5.34 $ 15,384 The intrinsic value of options exercised during the years ended December 31, 2021, 2020, and 2019 was $14.3 million, $5.8 million, and $5.1 million, respectively, resulting in tax benefits of $5.0 million, $2.0 million, and $1.8 million, respectively, which are reflected as an outflow from operating activities and an inflow from financing activities in the Consolidated Statements of Cash Flows. The weighted average fair values of the options granted under the Plans were calculated using the Black-Scholes method. The weighted average grant date fair value and weighted average assumptions used in the option pricing models are as follows: Year Ended December 31, 2021 2020 2019 Weighted average grant date fair value $ 14.94 $ 7.28 $ 8.92 Weighted average risk free interest rate 0.49 % 0.93 % 2.07 % Weighted average expected dividend yield 2.87 % 4.75 % 1.28 % Weighted average expected volatility 50.29 % 49.44 % 50.93 % Weighted average expected life (in years) 4.62 4.62 4.63 Information with respect to non-vested restricted stock unit activity follows: Restricted Awards Weighted Average Balance outstanding at January 1, 2021 1,383,951 $ 20.09 Granted (1) 8,599,682 53.03 Vested (690,957) 24.12 Forfeited (83,419) 45.11 Balance outstanding at December 31, 2021 9,209,257 $ 50.33 (1) Includes 8,096,595 issued under restricted stock agreements to the former owners of Acima Holdings and valued at $51.14 per share. Restricted stock units are valued using the closing price reported by the Nasdaq Global Select Market on the trading day immediately preceding the day of the grant. Unrecognized compensation expense for unvested restricted stock units at December 31, 2021, was approximately $317.5 million expected to be recognized over a weighted average period of 2.11 years. |
Deferred Compensation Plan (Not
Deferred Compensation Plan (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Compensation Plan [Abstract] | |
Deferred Compensation Plan [Text Block] | Deferred Compensation Plan The Rent-A-Center, Inc. Deferred Compensation Plan (the “Deferred Compensation Plan”) is an unfunded, nonqualified deferred compensation plan for a select group of our key management personnel and highly compensated employees. The Deferred Compensation Plan first became available to eligible employees in July 2007, with deferral elections taking effect as of August 3, 2007. The Deferred Compensation Plan allows participants to defer up to 50% of their base compensation and up to 100% of any bonus compensation. Participants may invest the amounts deferred in measurement funds that are the same funds offered as the investment options in the Rent-A-Center, Inc. 401(k) Retirement Savings Plan. We may make discretionary contributions to the Deferred Compensation Plan, which are subject to a three-year graded vesting schedule based on the participant’s years of service with us. We are obligated to pay the deferred compensation amounts in the future in accordance with the terms of the Deferred Compensation Plan. Assets and associated liabilities of the Deferred Compensation Plan are included in prepaid and other assets and accrued liabilities in our Consolidated Balance Sheets. For the years ended December 31, 2021, 2020 and 2019, we made matching cash contributions of approximately $170 thousand, $160 thousand, and $150 thousand, respectively, which represents 50% of the employees’ contributions to the Deferred Compensation Plan up to an amount not to exceed 6% of each employee's respective compensation. No other discretionary contributions were made for the years ended December 31, 2021, 2020 and 2019. The deferred compensation plan assets and liabilities were approximately $10.4 million and $9.5 million as of December 31, 2021 and 2020, respectively. |
401(k) Plan (Notes)
401(k) Plan (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
401(k) Plan [Abstract] | |
Compensation and Employee Benefit Plans [Text Block] | 401(k) Plan We sponsor a defined contribution plan under Section 401(k) of the Internal Revenue Code for certain employees who have completed at least three months of service. Employees may elect to contribute up to 50% of their eligible compensation on a pre-tax basis, subject to limitations. We may make discretionary contributions to the 401(k) plan. Employer matching contributions are subject to a three-year graded vesting schedule based on the participant's years of service with us. For the years ended December 31, 2021, 2020 and 2019, we made matching cash contributions of $6.4 million, $5.5 million, and $6.6 million, respectively, which represents 50% of the employees’ contributions to the 401(k) plan up to an amount not to exceed 6% of each employee's respective compensation. Employees are permitted to elect to purchase our common stock as part of their 401(k) plan, up to specified limitations. As of December 31, 2021 and 2020, 6.9% and 8.2%, respectively, of the total plan assets consisted of our common stock. |
Fair Value (Notes)
Fair Value (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | Fair Value We follow a three-tier fair value hierarchy, which classifies the inputs used in measuring fair values, in determining the fair value of our non-financial assets and non-financial liabilities, which consist primarily of goodwill. These tiers include: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. Our financial instruments include cash and cash equivalents, receivables, payables, borrowings against our ABL Credit Facility and Term Loan Facility, and outstanding Notes. The carrying amount of cash and cash equivalents, receivables and payables approximates fair value at December 31, 2021 and December 31, 2020, because of the short maturities of these instruments. In addition, the interest rates on our Term Loan Facility and ABL Credit Facility are variable and, therefore, we believe the carrying value of outstanding borrowings approximates their fair value. The fair value of our Notes is based on Level 1 inputs and was as follows at December 31, 2021: December 31, 2021 (in thousands) Carrying Value Fair Value Difference Senior notes $ 450,000 $ 469,125 $ 19,125 |
Stock Repurchase Plan (Notes)
Stock Repurchase Plan (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Stock Repurchase Plan [Abstract] | |
Stock repurchase plan [Text Block] | Stock Repurchase Plan In early December 2021, our Board of Directors authorized a new stock repurchase program for up to $500.0 million (the “December 2021 Program”), which superseded our previous stock repurchase program. Under the December 2021 program, we may purchase shares of our common stock from time to time in the open market or privately negotiated transactions. We are not obligated to acquire any shares under the program, and the program may be suspended or discontinued at any time. Under the December 2021 Program, 2,829,700 shares of our common stock were repurchased for an aggregate purchase price of approximately $140.0 million and $360.0 million remains available for repurchases. Under previous repurchase programs, 5,069,108 shares of our common stock were repurchased for an aggregate purchase price of $250.0 million during 2021. During 2020, 1,463,377 shares of our common stock were repurchased for an aggregate purchase prices of $26.6 million. |
Segment Information (Notes)
Segment Information (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information [Abstract] | |
Segment Information [Text Block] | Segment Information The operating segments reported below are the segments for which separate financial information is available and for which segment results are evaluated by the chief operating decision makers. Our operating segments are organized based on factors including, but not limited to, type of business transactions, geographic location and store ownership. Within our operating segments, we offer merchandise for lease from certain basic product categories: furniture, including mattresses, tires, consumer electronics, appliances, tools, handbags, computers, smartphones, and accessories. We report financial operating performance under four operating segments. To better reflect the Company's current strategic focus, our retail partner business operations are now reported as the Acima segment (formerly Preferred Lease), which includes our virtual and staffed business models; and our Rent-A-Center Business segment (formerly Core U.S.), which operates our company-owned stores and e-commerce platform through rentacenter.com. In addition, we report operating results for our Mexico and Franchising segments. Reportable segments and their respective operations are defined as follows. Our Rent-A-Center Business segment primarily operates lease-to-own stores in the United States and Puerto Rico whose customers enter into weekly, semi-monthly or monthly rental purchase agreements, which renew automatically upon receipt of each payment. We retain the title to the merchandise during the term of the rental purchase agreement and ownership passes to the customer if the customer has continuously renewed the rental purchase agreement through the end of the term or exercises a specified early purchase option. This segment also includes the 45 stores operating in two states that utilize a retail model which generates installment credit sales through a retail sale transaction. Segment assets include cash, receivables, rental merchandise, property assets and other intangible assets. Our Acima segment, which primarily operates in the United States and Puerto Rico, and which includes the operations of Acima Holdings acquired in February 2021 and our former Preferred Lease virtual and staffed locations, generally offers the lease-to-own transaction to consumers who do not qualify for financing from the traditional retailer. The Acima segment offers the lease-to-own transaction through our virtual offering solutions across e-commerce, digital, and mobile channels, and through staffed and unstaffed kiosks located within such retailer’s locations. Our Mexico segment currently consists of our company-owned lease-to-own stores in Mexico. The nature of this segment's operations and assets are the same as our Rent-A-Center Business segment. The stores in our Franchising segment use Rent-A-Center’s, ColorTyme’s or RimTyme’s trade names, service marks, trademarks and logos, and operate under distinctive operating procedures and standards. Franchising’s primary source of revenue is the sale of rental merchandise to its franchisees who, in turn, offer the merchandise to the general public for rent or purchase under a lease-to-own program. As franchisor, Franchising receives royalties of 2.0% to 6.0% of the franchisees' monthly gross revenue and initial fees for new locations. Segment assets include cash, trade receivables, property assets and intangible assets. Segment information as of and for the years ended December 31, 2021, 2020, and 2019 is as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Revenues Rent-A-Center Business $ 2,037,849 $ 1,852,641 $ 1,800,486 Acima 2,328,089 810,151 749,260 Mexico 61,403 50,583 53,960 Franchising 156,110 100,816 66,146 Total revenues $ 4,583,451 $ 2,814,191 $ 2,669,852 Year Ended December 31, (In thousands) 2021 2020 2019 Gross profit Rent-A-Center Business $ 1,433,536 $ 1,294,695 $ 1,255,153 Acima 728,852 321,110 333,798 Mexico 43,117 35,665 37,488 Franchising 29,507 20,682 17,632 Total gross profit $ 2,235,012 $ 1,672,152 $ 1,644,071 Year Ended December 31, (In thousands) 2021 2020 2019 Operating profit Rent-A-Center Business $ 448,905 $ 333,379 $ 235,964 Acima 176,496 57,847 83,066 Mexico 7,858 5,798 5,357 Franchising 20,321 12,570 7,205 Total segments 653,580 409,594 331,592 Corporate (1) (373,041) (172,258) (77,733) Total operating profit $ 280,539 $ 237,336 $ 253,859 (1) Includes stock compensation expense of $127.1 million recognized in 2021, related to common stock issued to Acima Holdings employees under restricted stock agreements as part of the acquisition consideration subject to vesting restrictions as described in Note N. Year Ended December 31, (In thousands) 2021 2020 2019 Depreciation, amortization and write-down of intangibles Rent-A-Center Business $ 18,588 $ 19,912 $ 20,822 Acima (1)(2) 2,122 2,066 1,533 Mexico 511 413 401 Franchising 93 40 45 Total segments 21,314 22,431 22,801 Corporate 33,516 34,227 38,303 Total depreciation, amortization and write-down of intangibles $ 54,830 $ 56,658 $ 61,104 (1) Excludes amortization expense of approximately $101.7 million for the twelve months ended December 31, 2021, recorded to Other charges (gains) in the Consolidated Statement of Operations, related to intangible assets acquired upon closing of the Acima Holdings acquisition, see Note N for additional information. (2) Excludes depreciation expense of approximately $13.2 million for the twelve months ended December 31, 2021, recorded to Other charges (gains) in the Consolidated Statement of Operations, related to software acquired upon closing of the Acima Holdings acquisition, see Note N for additional information. Year Ended December 31, (In thousands) 2021 2020 2019 Capital expenditures Rent-A-Center Business $ 23,139 $ 14,869 $ 10,255 Acima 1,045 161 141 Mexico 1,032 392 172 Total segments 25,216 15,422 10,568 Corporate 37,234 19,123 10,589 Total capital expenditures $ 62,450 $ 34,545 $ 21,157 December 31, (In thousands) 2021 2020 2019 On rent rental merchandise, net Rent-A-Center Business $ 477,901 $ 444,945 $ 411,482 Acima 676,279 299,660 268,845 Mexico 18,844 18,281 16,943 Total on rent rental merchandise, net $ 1,173,024 $ 762,886 $ 697,270 December 31, (In thousands) 2021 2020 2019 Held for rent rental merchandise, net Rent-A-Center Business $ 123,111 $ 136,219 $ 131,086 Acima 626 2,228 1,254 Mexico 9,247 7,819 6,078 Total held for rent rental merchandise, net $ 132,984 $ 146,266 $ 138,418 December 31, (In thousands) 2021 2020 2019 Assets by segment Rent-A-Center Business $ 1,026,886 $ 999,252 $ 953,151 Acima 1,476,752 389,650 357,859 Mexico 41,669 42,278 33,707 Franchising 15,412 14,729 11,095 Total segments 2,560,719 1,445,909 1,355,812 Corporate 432,608 305,071 226,986 Total assets $ 2,993,327 $ 1,750,980 $ 1,582,798 December 31, (In thousands) 2021 2020 2019 Assets by country United States $ 2,951,658 $ 1,708,702 $ 1,547,895 Mexico 41,669 42,278 33,707 Canada — — 1,196 Total assets $ 2,993,327 $ 1,750,980 $ 1,582,798 Year Ended December 31, (In thousands) 2021 2020 2019 Rentals and fees by inventory category Furniture and accessories $ 1,542,003 $ 1,028,876 $ 982,644 Consumer electronics 435,004 358,931 346,668 Appliances 426,316 322,261 358,619 Wheels and tires 280,132 — — Computers 155,313 119,015 103,171 Jewelry 146,477 — — Smartphones 61,058 59,205 62,948 Other products and services 476,150 374,803 370,352 Total rentals and fees $ 3,522,453 $ 2,263,091 $ 2,224,402 Year Ended December 31, (In thousands) 2021 2020 2019 Revenue by country United States $ 4,522,048 $ 2,763,608 $ 2,615,892 Mexico 61,403 50,583 53,960 Total revenues $ 4,583,451 $ 2,814,191 $ 2,669,852 |
Earnings Per Common Share (Note
Earnings Per Common Share (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Share [Text Block] | Earnings Per Common Share Summarized basic and diluted earnings per common share were calculated as follows: Year Ended December 31, (In thousands, except per share data) 2021 2020 2019 Numerator: Net earnings $ 134,940 $ 208,115 $ 173,546 Denominator: Weighted-average shares outstanding 57,053 54,187 54,325 Effect of dilutive stock awards 9,786 1,567 1,630 Weighted-average dilutive shares 66,839 55,754 55,955 Basic earnings per share $ 2.37 $ 3.84 $ 3.19 Diluted earnings per share $ 2.02 $ 3.73 $ 3.10 Anti-dilutive securities excluded from diluted earnings per common share: Anti-dilutive restricted share units 32 1 — Anti-dilutive performance share units 107 3 290 Anti-dilutive stock options 295 949 1,109 |
Nature of Operations and Summ_2
Nature of Operations and Summary of Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Nature of Operations and Summary of Accounting Policies [Abstract] | |
Principles of Consolidation and Nature of Operations [Policy Text Block] | Principles of Consolidation and Nature of Operations The financial statements included herein include the accounts of Rent-A-Center, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated. Unless the context indicates otherwise, references to “Rent-A-Center” refer only to Rent-A-Center, Inc., the parent, and references to the “Company,” “we,” “us” and “our” refer to the consolidated business operations of Rent-A-Center and any or all of its direct and indirect subsidiaries. We report four operating segments: Rent-A-Center Business, Acima, Mexico and Franchising. Our Rent-A-Center Business segment consists of company-owned lease-to-own stores in the United States and Puerto Rico that lease household durable goods to customers on a lease-to-own basis. We also offer merchandise on an installment sales basis in certain of our stores under the names “Get It Now” and “Home Choice.” Our Rent-A-Center Business segment operates through our company-owned stores and e-commerce platform through rentacenter.com. At December 31, 2021, we operated 1,846 company-owned stores nationwide and in Puerto Rico, including 45 retail installment sales stores. Our Acima segment, which operates in the United States and Puerto Rico, and includes the operations of Merchants Preferred (as defined in Note B below) acquired in August 2019, generally offers the lease-to-own transaction to consumers who do not qualify for financing from the traditional retailer through kiosks located within such retailer’s locations, including staffed options and unstaffed or virtual options. Virtual locations employ a virtual solution where customers, either directly or with the assistance of a representative of the third-party retailer, initiate the lease-to-own transaction online in the retailers’ locations using our virtual solutions. Our Mexico segment consists of our company-owned lease-to-own stores in Mexico that lease household durable goods to customers on a lease-to-own basis. At December 31, 2021, we operated 123 stores in Mexico. Rent-A-Center Franchising International, Inc., an indirect wholly-owned subsidiary of Rent-A-Center, is a franchisor of lease-to-own stores. At December 31, 2021, Franchising had 466 franchised stores operating in 32 states. Our Franchising segment’s primary source of revenue is the sale of rental merchandise to its franchisees, who in turn offer the merchandise to the general public for rent or purchase under a lease-to-own transaction. The balance of our Franchising segment’s revenue is generated primarily from royalties based on franchisees’ monthly gross revenues. |
Rental Merchandise [Policy Text Block] | Rental Merchandise Rental merchandise is carried at cost, net of accumulated depreciation. Depreciation for merchandise in Rent-A-Center Business and staffed Acima locations is generally provided using the income forecasting method, which is intended to match as closely as practicable the recognition of depreciation expense with the consumption of the rental merchandise, and assumes no salvage value. The consumption of rental merchandise occurs during periods of rental and directly coincides with the receipt of rental revenue over the rental purchase agreement period. Under the income forecasting method, merchandise held for rent is not depreciated and merchandise on rent is depreciated in the proportion of rents received to total rents provided in the rental contract, which is an activity-based method similar to the units of production method. In addition, we depreciate merchandise (including computers and tablets) that is held for rent for at least 180 consecutive days using the straight-line method over a period generally not to exceed 18 months. Smartphones are depreciated over an 18-month straight-line basis beginning with the earlier of on rent or 90 consecutive days held for rent. Depreciation of merchandise in our virtual business is recognized using a straight-line method over the term of the lease contract. Rental merchandise that is damaged and inoperable is expensed when such impairment occurs. If a customer does not return the merchandise or make payment, the remaining book value of the rental merchandise associated with delinquent accounts is generally charged off on or before the 90 th day following the time the account became past due in the Rent-A-Center Business and Mexico segments, and during the month following the 120 th day in our Acima virtual business and 150 th day in our Acima staffed locations. Minor repairs made to rental merchandise are expensed at the time of the repair. In addition, we maintain a reserve for these expected losses, which estimates the merchandise losses incurred but not yet identified by management as of the end of the accounting period based on a combination of historical write-offs and expected future losses. As of December 31, 2021 and 2020, the reserve for merchandise losses was $98.2 million and $58.1 million, respectively. Expenses related to merchandise losses, damaged merchandise, or merchandise repairs are recorded to other store expenses in our Consolidated Statement of Operations. |
Cash Equivalents [Policy Text Block] | Cash Equivalents Cash equivalents include all highly liquid investments with an original maturity of three months or less. We maintain cash and cash equivalents at several financial institutions, which at times may not be federally insured or may exceed federally insured limits. We have not experienced any losses in such accounts and believe we are not exposed to any significant credit risks on such accounts. |
Revenues [Policy Text Block] | Revenues Merchandise is rented to customers pursuant to rental purchase agreements which provide for weekly, semi-monthly or monthly rental terms with non-refundable rental payments. Generally, the customer has the right to acquire title either through a purchase option or through payment of all required rentals. Rental revenue and fees are recognized over the rental term and merchandise sales revenue is recognized when the customer exercises the purchase option and pays the cash price due. Cash received prior to the period in which it should be recognized is deferred and recognized according to the rental term. Revenue is accrued for uncollected amounts due based on historical collection experience. However, the total amount of the rental purchase agreement is not accrued because the customer can terminate the rental agreement at any time and we cannot enforce collection for non-payment of future rents. Revenues from the sale of merchandise in our retail installment stores are recognized when the installment note is signed, the customer has taken possession of the merchandise and collectability is reasonably assured. |
Receivables and Allowance for Doubtful Accounts [Policy Text Block] | Receivables and Allowance for Doubtful Accounts The installment notes receivable associated with the sale of merchandise at our Get It Now and Home Choice stores generally consists of the sales price of the merchandise purchased and any additional fees for services the customer has chosen, less the customer’s down payment. No interest is accrued and interest income is recognized each time a customer makes a payment, generally on a monthly basis. We have established an allowance for doubtful accounts for our installment notes receivable. Our policy for determining the allowance is based on historical loss experience, as well as the results of management’s review and analysis of the payment and collection of the installment notes receivable within the previous year. We believe our allowance is adequate to absorb any known or probable losses. Our policy is to charge off installment notes receivable that are 120 days or more past due. Charge-offs are applied as a reduction to the allowance for doubtful accounts and any recoveries of previously charged off balances are applied as an increase to the allowance for doubtful accounts. Our trade and notes receivables consist primarily of amounts due from our rental customers for renewal and uncollected rental payments, Franchising receivables, and other corporate related receivables. The majority of our Franchising trade and notes receivables relate to amounts due from franchisees for inventory purchases, earned royalties and other obligations. Credit is extended based on an evaluation of a franchisee’s financial condition and collateral is generally not required. Trade receivables are generally due within 30 days and are reported as amounts due from franchisees, net of an allowance for doubtful accounts. Accounts that are outstanding longer than the contractual payment terms are considered past due. Franchising determines its allowance by considering a number of factors, including the length of time receivables are past due, previous loss history, the franchisee’s current ability to pay its obligation, and the condition of the general economy and the industry as a whole. Franchising writes off trade receivables that are 90 or more days past due and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. |
Property Assets and Related Depreciation [Policy Text Block] | Property Assets and Related Depreciation Furniture, equipment and vehicles are stated at cost less accumulated depreciation. Depreciation is provided over the estimated useful lives of the respective assets (generally 5 years) on the straight-line method. Leasehold improvements are amortized over the useful life of the asset or the initial term of the applicable leases on the straight-line method, whichever is shorter. We have incurred costs to develop computer software for internal use. We capitalize the costs incurred during the application development stage, which includes designing the software configuration and interfaces, coding, installation, and testing. Costs incurred during the preliminary stages along with post-implementation stages of internally developed software are expensed as incurred. Internally developed software costs, once placed in service, are amortized over various periods up to 10 years. |
Goodwill and Other Intangible Assets [Policy Text Block] | Goodwill and Other Intangible Assets We record goodwill when the consideration paid for an acquisition exceeds the fair value of the identifiable net tangible and identifiable intangible assets acquired. Goodwill is not subject to amortization but must be periodically evaluated for impairment for each reporting unit. Impairment occurs when the carrying value of goodwill is not recoverable from future cash flows. We perform an assessment of goodwill for impairment at the reporting unit level annually as of October 1, or when events or circumstances indicate that impairment may have occurred. Our reporting units are our reportable operating segments. Factors which could necessitate an interim impairment assessment include a sustained decline in our stock price, prolonged negative industry or economic trends and significant underperformance relative to expected historical or projected future operating results. Based on our assessment, if the fair value of the reporting unit exceeds its carrying value, then the goodwill is not deemed impaired. If the carrying value of the reporting unit exceeds fair value, goodwill is deemed impaired and the impairment is measured as the difference between the carrying value and the fair value of the respective reporting unit. We determine the fair value of each reporting unit using methodologies which include the present value of estimated future cash flows and comparisons of multiples of enterprise values to earnings before interest, taxes, depreciation and amortization. The analysis is based upon available information regarding expected future cash flows and discount rates. Discount rates are generally based upon our weighted average cost of capital. As an alternative to performing a quantitative assessment to measure the fair value of the reporting unit, the Company may perform a qualitative assessment for impairment if it believes it is not more likely than not that the carrying value of the net assets of the reporting unit exceeds its fair value. At December 31, 2021, the amount of goodwill attributable to the Rent-A-Center Business and Acima segments was approximately $1.5 million and $288.3 million, respectively. We currently do not have goodwill balances attributable to our Mexico or Franchising segments. Acquired intangible assets are recorded at their estimated fair value as of the date of acquisition and generally include customer relationships, merchant relationships, non-compete agreements and trade names. Customer relationships are generally amortized over a 21-month period, excluding Relationships with Existing Lessees recently acquired from Acima Holdings which are being amortized over 12 months. Non-compete Agreements are amortized over the contractual life of the agreements, Merchant Relationships are amortized over a 7 to 10 year period, and Trade Names and other intangible assets are amortized over the estimated life of the asset. Intangible assets are amortized using methods that we believe reflect the pattern in which the economic benefits of the related asset are consumed unless such pattern cannot be reliably determined, in which case we amortize using a straight-line amortization method. |
Accounting for Impairment of Long-Lived Assets [Policy Text Block] | Accounting for Impairment of Long-Lived AssetsWe evaluate all long-lived assets, including intangible assets, excluding goodwill, for impairment whenever events or changes in circumstances indicate that the carrying amounts of the related assets may not be recoverable by the undiscounted net cash flows they will generate. Impairment is recognized when the carrying amounts of such assets exceed their fair value. We determine the fair value of our long-lived assets using methodologies which include the present value of estimated future cash flows of the asset, or related fair market values for similar assets. |
Self-Insurance Liabilities [Policy Text Block] | Self-Insurance Liabilities We have self-insured retentions with respect to losses under our workers’ compensation, general liability, vehicle liability and health insurance programs. We establish reserves for our liabilities associated with these losses by obtaining forecasts for the ultimate expected losses and estimating amounts needed to pay losses within our self-insured retentions. We make assumptions on our liabilities within our self-insured retentions using actuarial loss forecasts, company-specific development factors, general industry loss development factors, and third-party claim administrator loss estimates which are based on known facts surrounding individual claims. These assumptions incorporate expected increases in health care costs. Periodically, we reevaluate our estimate of liability within our self-insured retentions. At that time, we evaluate the adequacy of our reserves by comparing amounts reserved on our balance sheet for anticipated losses to our updated actuarial loss forecasts and third-party claim administrator loss estimates, and make adjustments to our reserves as needed. |
Foreign Currency Translation [Policy Text Block] | Foreign Currency Translation The functional currency of our foreign operations is the applicable local currency. Assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the current rate of exchange on the last day of the reporting period. Revenues and expenses are generally translated at a daily exchange rate and equity transactions are translated using the actual rate on the day of the transaction. |
Other Comprehensive income (Loss) [Policy Text Block] | Other Comprehensive (Loss) Income Other comprehensive (loss) income is comprised exclusively of our foreign currency translation adjustment. |
Income Taxes [Policy Text Block] | Income Taxes We record deferred taxes for temporary differences between the tax and financial reporting bases of assets and liabilities at the enacted tax rate expected to be in effect when those temporary differences are expected to be recovered or settled. Income tax accounting requires management to make estimates and apply judgments to events that will be recognized in one period under rules that apply to financial reporting in a different period in our tax returns. In particular, judgment is required when estimating the value of future tax deductions, tax credits and net operating loss carryforwards (NOLs), as represented by deferred tax assets. We evaluate the recoverability of these future tax deductions and credits by assessing the future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies. These sources of income rely heavily on estimates. We use our historical experience and our short- and long-range business forecasts to provide insight and assist us in determining recoverability. When it is determined the recovery of all or a portion of a deferred tax asset is not likely, a valuation allowance is established. We include NOLs in the calculation of deferred tax assets. NOLs are utilized to the extent allowable due to the provisions of the Internal Revenue Code of 1986, as amended, and relevant state statutes. |
Sales Tax [Policy Text Block] | Sales Taxes We apply the net basis for sales taxes imposed on our goods and services in our Consolidated Statements of Operations. We are required by the applicable governmental authorities to collect and remit sales taxes. Accordingly, such amounts are charged to the customer, collected and remitted directly to the appropriate jurisdictional entity. |
Earnings Per Common Share [Policy Text Block] | Earnings Per Common Share Basic earnings per common share are based upon the weighted average number of common shares outstanding during each period presented. Diluted earnings per common share are based upon the weighted average number of common shares outstanding during the period, plus, if dilutive, the assumed exercise of stock options and vesting of stock awards at the beginning of the year, or for the period outstanding during the year for current year issuances. |
Advertising Costs [Policy Text Block] | Advertising Costs Costs incurred for producing and communicating advertising are expensed when incurred. Advertising expense was $73.9 million, $50.9 million, and $58.8 million, for the years ended December 31, 2021, 2020, and 2019, respectively. Advertising expense is net of vendor allowances of $21.6 million, $24.8 million, and $21.2 million for the years ended December 31, 2021, 2020, and 2019, respectively. |
Share-based Compensation [Policy Text Block] | Stock-Based Compensation We maintain long-term incentive plans for the benefit of certain employees and directors, which are described more fully in Note O. We recognize share-based payment awards to our employees and directors at the estimated fair value on the grant date. Determining the fair value of any share-based award requires information about several variables that include, but are not |
Reclassifications [Policy Text Block] | Reclassifications Certain reclassifications may be made to the reported amounts for prior periods to conform to the current period presentation. These reclassifications have no impact on net earnings or earnings per share in any period. |
Use of Estimates [Policy Text Block] | Use of Estimates In preparing financial statements in conformity with U.S. generally accepted accounting principles, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent losses and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. In applying accounting principles, we must often make individual estimates and assumptions regarding expected outcomes or uncertainties. Our estimates, judgments and assumptions are continually evaluated based on available information and experience. However, uncertainties, including future unknown impacts of the COVID-19 pandemic, may affect certain estimates and assumptions inherent in the financial reporting process, which may impact reported amounts of assets and liabilities in future periods and cause actual results to differ from those estimates. |
Newly Adopted Accounting Pronouncements [Text Block] | Newly Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. The standard removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. We adopted ASU 2019-12 beginning January 1, 2021 using a prospective approach. Impacts to our financial statements for the twelve months ended December 31, 2021 resulting from the adoption of this ASU were immaterial. |
Acquisitions and Divestitures_2
Acquisitions and Divestitures (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Acima acquisition [Table Text Block] | The following table provides the estimated fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date: (in thousands) February 17, 2021 Aggregate cash consideration $ 1,273,263 Aggregate stock consideration, subject to lockup agreements 120,929 Total Purchase price $ 1,394,192 ASSETS ACQUIRED Receivables, net (1) $ 25,255 Prepaid expenses and other assets 700 Rental merchandise On rent 340,575 Property assets 171,455 Operating lease right-of-use assets 9,136 Deferred income taxes 28,559 Goodwill 219,530 Other intangible assets 520,000 Total assets acquired $ 1,315,210 LIABILITIES ASSUMED Accounts payable - trade 16,023 Accrued liabilities 11,716 Operating lease liabilities 9,689 Deferred income taxes (116,410) Total liabilities assumed (78,982) Total equity value $ 1,394,192 (1) Includes gross contractual receivables of $61.6 million related to merchandise lease contracts, of which $34.7 million were estimated to be uncollectible. |
Acquisitions [Table Text Block] | The following table provides information concerning other store acquisitions completed during the years ended December 31, 2021, 2020 and 2019. Year Ended December 31, (Dollar amounts in thousands) 2021 2020 2019 Number of stores acquired remaining open 1 — — Number of stores acquired that were merged with existing stores — 2 4 Number of transactions 1 2 4 Total purchase price $ 278 $ 700 $ 504 Amounts allocated to: Goodwill $ — $ — $ 66 Customer relationships 30 177 85 Rental merchandise 248 523 353 |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block] | The fair value measurements for acquired intangible assets and developed technology were primarily based on significant unobservable inputs (Level 3) developed using company-specific information. Certain fair value estimates were determined based on an independent valuation of the net assets acquired, including $340.6 million of rental merchandise and $520 million of identifiable intangible assets with an estimated weighted average useful life of 8 years, as follows: Asset Class Estimated Fair Value Estimated Remaining Useful Life (in years) Merchant relationships $ 380,000 10 Relationship with existing lessees 60,000 1 Trade name 40,000 7 Non-compete agreements 40,000 3 |
Pro Forma combined results | The unaudited pro forma financial information is as follows: Year Ended December 31, (in thousands) 2021 2020 (unaudited) (unaudited) Pro Forma total revenues $ 4,778,055 $ 4,071,990 Pro Forma net earnings (1) 178,103 66,352 (1) Total pro forma adjustments to net earnings represented an increase of $16.0 million and a decrease of $356.8 million for the twelve months ended December 31, 2021 and 2020, respectively. The amounts of revenue and earnings of Acima Holdings included in our Consolidated Statements of Operations as of December 31, 2021 and 2020 from the acquisition date of February 17th for each year presented are as follows: (in thousands) February 17, 2021 - December 31, 2021 February 17, 2020 - December 31, 2020 audited (unaudited) Total revenues $ 1,495,746 $ 1,116,430 Net earnings (1) 119,183 196,088 (1) Net Earnings for the period February 17, 2021 - December 31, 2021 includes amortization of intangible assets acquired upon closing of the Acima Holdings acquisition. |
Merchant Preferred acquisition | The following table provides the final estimated fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date: (in thousands) August 13, 2019 Receivables $ 1,813 Prepaid expenses and other assets 154 Rental merchandise 17,904 Software 4,300 Right of use operating leases 404 Other intangible assets 8,900 Goodwill 13,403 Lease liabilities (487) Net identifiable assets acquired $ 46,391 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenues [Abstract] | |
Disaggregation of Revenue [Table Text Block] | The following tables disaggregates our revenue: Twelve Months Ended December 31, 2021 Rent-A-Center Business Acima Mexico Franchising Consolidated (In thousands) Store Rentals and fees $ 1,762,847 $ 1,701,532 $ 58,074 $ — $ 3,522,453 Merchandise sales 199,781 626,166 3,275 — 829,222 Installment sales 73,585 — — — 73,585 Other 1,636 391 54 2,067 4,148 Total store revenues 2,037,849 2,328,089 61,403 2,067 4,429,408 Franchise Merchandise sales — — — 126,856 126,856 Royalty income and fees — — — 27,187 27,187 Total revenues $ 2,037,849 $ 2,328,089 $ 61,403 $ 156,110 $ 4,583,451 Twelve Months Ended December 31, 2020 Rent-A-Center Business Acima Mexico Franchising Consolidated (In thousands) Store Rentals and fees $ 1,604,615 $ 610,908 $ 47,568 $ — $ 2,263,091 Merchandise sales 177,223 198,517 2,977 — 378,717 Installment sales 68,500 — — — 68,500 Other 2,303 726 38 778 3,845 Total store revenues 1,852,641 810,151 50,583 778 2,714,153 Franchise Merchandise sales — — — 80,023 80,023 Royalty income and fees — — — 20,015 20,015 Total revenues $ 1,852,641 $ 810,151 $ 50,583 $ 100,816 $ 2,814,191 Twelve Months Ended December 31, 2019 Rent-A-Center Business Acima Mexico Franchising Consolidated (In thousands) Store Rentals and fees $ 1,585,997 $ 587,502 $ 50,903 $ — $ 2,224,402 Merchandise sales 140,372 161,235 3,023 — 304,630 Installment sales 70,434 — — — 70,434 Other 3,683 523 34 555 4,795 Total store revenues 1,800,486 749,260 53,960 555 2,604,261 Franchise Merchandise sales — — — 49,135 49,135 Royalty income and fees — — — 16,456 16,456 Total revenues $ 1,800,486 $ 749,260 $ 53,960 $ 66,146 $ 2,669,852 |
Receivables and Allowance for_2
Receivables and Allowance for Doubtful Accounts (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Receivables and Allowance for Doubtful Accounts [Abstract] | |
Receivables [Table Text Block] | Receivables consist of the following: December 31, (In thousands) 2021 2020 Installment sales receivable $ 66,276 $ 61,794 Trade and notes receivables 68,581 36,256 Total receivables 134,857 98,050 Less allowance for doubtful accounts (8,479) (8,047) Total receivables, net of allowance for doubtful accounts $ 126,378 $ 90,003 |
Changes in allowance for doubtful accounts [Table Text Block] | Changes in our allowance for doubtful accounts are as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Beginning allowance for doubtful accounts $ 8,047 $ 5,601 $ 4,883 Estimated uncollectible payments and returns (1) 14,397 14,636 15,077 Accounts written off, net of recoveries (13,965) (12,190) (14,359) Ending allowance for doubtful accounts $ 8,479 $ 8,047 $ 5,601 (1) Uncollectible installment payments, franchisee obligations, and other corporate receivables are recognized in other store operating expenses in our consolidated financial statements. |
Rental Merchandise Rental (Tabl
Rental Merchandise Rental (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Rental Merchandise [Abstract] | |
Rental Merchandise [Table Text Block] | Rental Merchandise December 31, (In thousands) 2021 2020 On rent Cost $ 1,894,247 $ 1,169,333 Less accumulated depreciation (721,223) (406,447) Net book value, on rent $ 1,173,024 $ 762,886 Held for rent Cost $ 155,832 $ 165,879 Less accumulated depreciation (22,848) (19,613) Net book value, held for rent $ 132,984 $ 146,266 |
Property Assets (Tables)
Property Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property Assets [Abstract] | |
Property Assets [Table Text Block] | Property Assets December 31, (In thousands) 2021 2020 Software $ 468,011 $ 279,141 Building and leasehold improvements 199,280 196,179 Furniture and equipment 172,418 163,623 Transportation equipment 549 503 Construction in progress 25,293 7,269 Total property assets 865,551 646,715 Less accumulated depreciation (557,453) (505,074) Total property assets, net of accumulated depreciation $ 308,098 $ 141,641 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Operating lease costs [Table Text Block] | Total operating lease costs by expense type: Twelve Months Ended (in thousands) December 31, 2021 December 31, 2020 December 31, 2019 Operating lease cost included in other store expenses (1)(2) $ 129,217 $ 140,186 $ 148,314 Operating lease cost included in other charges (2) 302 1,236 9,222 Sublease receipts (11,806) (9,727) (7,683) Total operating lease charges $ 117,713 $ 131,695 $ 149,853 (1) Includes short-term lease costs, which are not significant. (2) Excludes variable lease costs of $33.7 million and $34.6 million for the twelve months ended December 31, 2021 and 2020, respectively. Supplemental cash flow information related to leases: Twelve Months Ended (in thousands) December 31, 2021 December 31, 2020 December 31, 2019 Cash paid for amounts included in measurement of operating lease liabilities $ 107,588 $ 113,243 $ 120,826 Cash paid for short-term operating leases not included in operating lease liabilities 17,266 22,339 27,402 Right-of-use assets obtained in exchange for new operating lease liabilities 100,779 104,771 78,250 Weighted-average discount rate and weighted-average remaining lease term: (in thousands) December 31, 2021 December 31, 2020 December 31, 2019 Weighted-average discount rate (1) 6.0 % 6.8 % 7.7 % Weighted-average remaining lease term (in years) 4 4 4 (1) January 1, 2019 incremental borrowing rate was used for leases in existence at the time of adoption of ASU 2016-02. |
Operating lease liability maturity [Table Text Block] | Reconciliation of undiscounted operating lease liabilities to the present value operating lease liabilities at December 31, 2021: (In thousands) Operating Leases 2022 $ 106,505 2023 83,248 2024 64,693 2025 47,248 2026 23,077 Thereafter 17,266 Total undiscounted operating lease liabilities 342,037 Less: Interest (45,502) Total present value of operating lease liabilities $ 296,535 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Amortizable intangible assets consist of the following: December 31, 2021 December 31, 2020 (Dollar amounts in thousands) Avg. Life (years) Gross Accumulated Gross Accumulated Customer relationships (1) 2 $ 140,039 $ 132,127 $ 80,008 $ 79,853 Merchant relationships 10 389,760 35,960 9,760 2,046 Trade Name 7 40,000 4,966 — — Non-compete agreements 3 46,719 18,307 6,719 6,719 Total other intangible assets $ 616,518 $ 191,360 $ 96,487 $ 88,618 (1) Includes acquired Relationships with Existing Lessees from Acima Holdings with a remaining useful life of 1 year from the date of acquisition, February 17, 2021. |
Aggregate Amortization Expense [Table Text Block] | Aggregate amortization expense (in thousands): Year Ended December 31, 2021 $ 102,742 Year Ended December 31, 2020 $ 1,070 Year Ended December 31, 2019 $ 723 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Estimated amortization expense, assuming current intangible balances and no new acquisitions, for each of the years ending December 31, is as follows: (In thousands) Estimated 2022 $ 65,850 2023 57,938 2024 46,350 2025 44,604 2026 44,604 Thereafter 165,812 Total amortization expense $ 425,158 |
Schedule of Goodwill [Table Text Block] | A summary of the changes in recorded goodwill follows: Year Ended December 31, (In thousands) 2021 2020 Beginning goodwill balance $ 70,217 $ 70,217 Additions from acquisitions 241,774 — Post purchase price allocation adjustments (22,241) — Ending goodwill balance $ 289,750 $ 70,217 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accrued Liabilities [Abstract] | |
Accrued liabilities [Table Text Block] | Accrued Liabilities December 31, (In thousands) 2021 2020 Accrued insurance costs $ 89,621 $ 94,744 Deferred revenue 71,376 61,066 Taxes other than income 49,708 48,038 Accrued compensation 46,750 48,027 Accrued dividends 27,801 17,003 Accrued legal settlement 22,500 5,440 Accrued interest payable 11,993 1,041 Deferred compensation 10,349 9,437 Accrued other 32,610 35,787 Total Accrued liabilities $ 362,708 $ 320,583 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes [Abstract] | |
Loss Before Income Tax, Domestic and Foreign [Table Text Block] | For financial statement purposes, earnings before income taxes by source was comprised of the following: Year Ended December 31, (In thousands) 2021 2020 2019 Domestic $ 176,042 $ 212,859 $ 212,406 Foreign 18,262 9,920 11,377 Earnings before income taxes $ 194,304 $ 222,779 $ 223,783 |
Reconciliation of Income Tax Expense [Table Text Block] | A reconciliation of the federal statutory rate of 21% to the effective rate follows: Year Ended December 31, 2021 2020 2019 Tax at statutory rate 21.0 % 21.0 % 21.0 % Stock compensation 11.6 % — % — % State income taxes 7.4 % 2.8 % 4.3 % Effect of foreign operations 2.0 % (0.3) % 0.3 % Effect of current and prior year credits (2.4) % (0.8) % (2.7) % Change in unrecognized tax benefits (2.8) % 0.3 % — % Other permanent differences 0.3 % (0.7) % 0.2 % Prior year return to provision adjustments (0.2) % 1.1 % (2.7) % Benefit of CARES Act — % (7.5) % — % Valuation allowance (7.1) % (9.3) % 1.2 % Other, net 0.8 % — % 0.8 % Effective income tax rate 30.6 % 6.6 % 22.4 % |
Components of Income Tax Expense [Table Text Block] | The components of income tax expense (benefit) are as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Current expense (benefit) Federal $ (7,398) $ 14,354 $ (6,996) State 15,106 4,735 528 Foreign 3,690 1,608 796 Total current 11,398 20,697 (5,672) Deferred expense (benefit) Federal 56,716 12,576 37,309 State (1,205) (2,956) 16,439 Foreign (7,545) (15,653) 2,161 Total deferred 47,966 (6,033) 55,909 Total income tax expense (benefit) $ 59,364 $ 14,664 $ 50,237 |
Deferred Tax Assets [Table Text Block] | Deferred tax assets (liabilities) consist of the following: December 31, (In thousands) 2021 2020 Deferred tax assets Net operating loss carryforwards $ 35,834 $ 32,834 Accrued liabilities 48,659 45,776 Intangible assets 165,135 9,676 Lease obligations 73,819 67,999 Other assets including credits 12,157 10,079 Foreign tax credit carryforwards 7,696 5,643 Total deferred tax assets 343,300 172,007 Valuation allowance (7,688) (21,645) Deferred tax assets, net 335,612 150,362 Deferred tax liabilities Rental merchandise (288,504) (206,833) Property assets (20,094) (18,935) Lease assets (72,458) (66,661) Other liabilities (108) (561) Total deferred tax liabilities (381,164) (292,990) Net deferred taxes $ (45,552) $ (142,628) |
Unrecognized Tax Benefits [Table Text Block] | A reconciliation of the beginning and ending amount of unrecognized tax benefits follows: Year Ended December 31, (In thousands) 2021 2020 2019 Beginning unrecognized tax benefit balance $ 22,184 $ 24,208 $ 36,364 Additions (Reductions) based on tax positions related to current year 461 1,204 (654) Additions for tax positions of prior years 4,119 45 415 Reductions for tax positions of prior years (3,006) (2,086) (11,917) Settlements (17,222) (1,187) — Ending unrecognized tax benefit balance $ 6,536 $ 22,184 $ 24,208 |
Senior Debt (Tables)
Senior Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Senior Debt [Abstract] | |
Debt facilities [Table Text Block] | The senior debt facilities as of December 31, 2021 and 2020 are as follows: December 31, 2021 December 31, 2020 (In thousands) Facility Maximum Amount Amount Maximum Amount Amount Senior Debt: Term Loan Facility February 17, 2028 $ 875,000 $ 868,438 $ — $ — $ — $ — ABL Credit Facility (1) February 17, 2026 550,000 290,000 173,616 300,000 — 209,268 Prior Term Loan Facility — — — 200,000 197,500 — Total $ 1,425,000 1,158,438 $ 173,616 $ 500,000 197,500 $ 209,268 Unamortized debt issuance costs (23,231) (7,010) Total senior debt, net $ 1,135,207 $ 190,490 (1) Borrowing availability is net of issued letters of credit of approximately $86.4 million and $90.7 million for the years ended December 31, 2021 and 2020, respectively |
Maturities of outstanding debt [Table Text Block] | The table below shows the scheduled maturity dates of our outstanding debt at December 31, 2021 for each of the years ending December 31: (in thousands) Term Loan Facility ABL Credit Facility Total 2022 $ 8,750 $ — $ 8,750 2023 8,750 — 8,750 2024 8,750 — 8,750 2025 8,750 — 8,750 2026 8,750 290,000 298,750 Thereafter 824,688 — 824,688 Total senior debt $ 868,438 $ 290,000 $ 1,158,438 |
Other Charges and (Gains) (Tabl
Other Charges and (Gains) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Other Charges - Operating Expenses [Abstract] | |
Other Charges (Gains) [Table Text Block] | Activity with respect to Other charges for the years ended December 31, 2020 and 2021 is summarized in the below table: (In thousands) Accrued Charges at December 31, 2019 Charges & Adjustments Payments & Adjustments Accrued Charges at December 31, 2020 Charges & Adjustments Payments & Adjustments Accrued Charges at December 31, 2021 Cash: Acima Holdings transaction costs $ — $ 6,400 $ (1,395) $ 5,005 $ 17,680 $ (22,685) $ — Acima Holdings integration costs — — — — 6,572 (6,572) — Labor reduction costs 738 1,334 (1,728) 344 3,751 (2,502) 1,593 Lease obligation costs (1) — (645) 645 — — — — Contract termination costs — — — — — — — Other cash charges (2) — 1,889 (1,889) — 658 (658) — Total cash charges $ 738 8,978 $ (4,367) $ 5,349 28,661 $ (32,417) $ 1,593 Non-cash: Acima Holdings restricted stock agreements (3) — 127,060 Depreciation and amortization of acquired assets (4) — 114,959 Asset impairments (5) 2,749 1,572 Rental merchandise losses (6) 860 — Other (7) 23,968 17,661 Total other charges $ 36,555 $ 289,913 (1) Includes lease abatement credits in 2020 related to renegotiated lease agreements in response to COVID-19. (2) Represents shutdown and holding expenses related to store closures. (3) Represents stock compensation expense recognized in 2021, related to common stock issued to Acima Holdings employees under restricted stock agreements as part of the acquisition consideration subject to vesting restrictions, as described in Note B and Note O. (4) Represents amortization of the total fair value of acquired intangible assets and incremental depreciation related to the fair value increase over net book value of acquired software assets in connection with the acquisition of Acima Holdings as described in Note B. (5) Asset impairments primarily includes store damage related to Hurricane Ida in 2021. Asset impairments in 2020 primarily include impairments of operating lease right-of-use assets and other property assets related to the closure of Rent-A-Center Business stores and previously closed product service centers, store damage related to looting, as well as a write-down of capitalized software. (6) Reflects merchandise losses due to looting. (7) Includes $17.5 million in legal settlement reserves and $0.2 million in state sales tax assessment reserves for 2021. Amounts accrued for potential settlements do not represent our maximum loss exposure. The amount of any loss ultimately incurred in relation to matters for which an accrual has been established may be significantly different than the amounts accrued for such matters due to the inherent uncertainty in litigation, regulatory and similar adversarial proceedings. For 2020, primarily includes a $16.6 million loss on the sale of our stores in California, $7.9 million for legal settlement reserves, $1.2 million for state tax audit assessment reserves, $1.4 million in expenses related to COVID-19, partially offset by $2.8 million in proceeds received from the sale of a class action claim and $0.3 million in insurance proceeds related to Hurricane Maria in 2017 for the year ended December 31, 2020. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stock-Based Compensation [Abstract] | |
Stock-based compensation expense [Table Text Block] | Stock-based compensation expense for the years ended December 31, 2021, 2020 and 2019 is as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Stock options $ 2,001 $ 1,878 $ 1,273 Restricted share units (1) 145,553 10,406 5,685 Total stock-based compensation expense 147,554 12,284 6,958 Tax benefit recognized in the statements of earnings 58,963 3,062 1,562 Stock-based compensation expense, net of tax $ 88,591 9,222 $ 5,396 (1) Includes $127.1 million in stock compensation expense related to 8,096,595 common shares issued to the former owners of Acima, as part of the Aggregate Stock Consideration subject to restricted stock agreements, and recorded to Other charges in our Consolidated Statements of Operations. See Note B and Note N for additional information. |
Stock option activity [Table Text Block] | Information with respect to stock option activity related to the Plans for the year ended December 31, 2021 follows: Equity Awards Weighted Average Weighted Average Aggregate Intrinsic Balance outstanding at January 1, 2021 1,658,165 $ 22.91 Granted 97,250 45.37 Exercised (476,398) 25.30 Forfeited (138,237) 31.45 Expired (19,291) 29.19 Balance outstanding at December 31, 2021 1,121,489 $ 22.68 6.70 $ 29,691 Exercisable at December 31, 2021 525,801 $ 19.65 5.34 $ 15,384 |
Weighted average fair values of options granted [Table Text Block] | The weighted average fair values of the options granted under the Plans were calculated using the Black-Scholes method. The weighted average grant date fair value and weighted average assumptions used in the option pricing models are as follows: Year Ended December 31, 2021 2020 2019 Weighted average grant date fair value $ 14.94 $ 7.28 $ 8.92 Weighted average risk free interest rate 0.49 % 0.93 % 2.07 % Weighted average expected dividend yield 2.87 % 4.75 % 1.28 % Weighted average expected volatility 50.29 % 49.44 % 50.93 % Weighted average expected life (in years) 4.62 4.62 4.63 |
Nonvested restricted stock units activity [Table Text Block] | Information with respect to non-vested restricted stock unit activity follows: Restricted Awards Weighted Average Balance outstanding at January 1, 2021 1,383,951 $ 20.09 Granted (1) 8,599,682 53.03 Vested (690,957) 24.12 Forfeited (83,419) 45.11 Balance outstanding at December 31, 2021 9,209,257 $ 50.33 (1) Includes 8,096,595 issued under restricted stock agreements to the former owners of Acima Holdings and valued at $51.14 per share. |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement Inputs and Valuation Techniques | The fair value of our Notes is based on Level 1 inputs and was as follows at December 31, 2021: December 31, 2021 (in thousands) Carrying Value Fair Value Difference Senior notes $ 450,000 $ 469,125 $ 19,125 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information [Abstract] | |
Segment Information [Table Text Block] | Segment information as of and for the years ended December 31, 2021, 2020, and 2019 is as follows: Year Ended December 31, (In thousands) 2021 2020 2019 Revenues Rent-A-Center Business $ 2,037,849 $ 1,852,641 $ 1,800,486 Acima 2,328,089 810,151 749,260 Mexico 61,403 50,583 53,960 Franchising 156,110 100,816 66,146 Total revenues $ 4,583,451 $ 2,814,191 $ 2,669,852 Year Ended December 31, (In thousands) 2021 2020 2019 Gross profit Rent-A-Center Business $ 1,433,536 $ 1,294,695 $ 1,255,153 Acima 728,852 321,110 333,798 Mexico 43,117 35,665 37,488 Franchising 29,507 20,682 17,632 Total gross profit $ 2,235,012 $ 1,672,152 $ 1,644,071 Year Ended December 31, (In thousands) 2021 2020 2019 Operating profit Rent-A-Center Business $ 448,905 $ 333,379 $ 235,964 Acima 176,496 57,847 83,066 Mexico 7,858 5,798 5,357 Franchising 20,321 12,570 7,205 Total segments 653,580 409,594 331,592 Corporate (1) (373,041) (172,258) (77,733) Total operating profit $ 280,539 $ 237,336 $ 253,859 (1) Includes stock compensation expense of $127.1 million recognized in 2021, related to common stock issued to Acima Holdings employees under restricted stock agreements as part of the acquisition consideration subject to vesting restrictions as described in Note N. Year Ended December 31, (In thousands) 2021 2020 2019 Depreciation, amortization and write-down of intangibles Rent-A-Center Business $ 18,588 $ 19,912 $ 20,822 Acima (1)(2) 2,122 2,066 1,533 Mexico 511 413 401 Franchising 93 40 45 Total segments 21,314 22,431 22,801 Corporate 33,516 34,227 38,303 Total depreciation, amortization and write-down of intangibles $ 54,830 $ 56,658 $ 61,104 (1) Excludes amortization expense of approximately $101.7 million for the twelve months ended December 31, 2021, recorded to Other charges (gains) in the Consolidated Statement of Operations, related to intangible assets acquired upon closing of the Acima Holdings acquisition, see Note N for additional information. (2) Excludes depreciation expense of approximately $13.2 million for the twelve months ended December 31, 2021, recorded to Other charges (gains) in the Consolidated Statement of Operations, related to software acquired upon closing of the Acima Holdings acquisition, see Note N for additional information. Year Ended December 31, (In thousands) 2021 2020 2019 Capital expenditures Rent-A-Center Business $ 23,139 $ 14,869 $ 10,255 Acima 1,045 161 141 Mexico 1,032 392 172 Total segments 25,216 15,422 10,568 Corporate 37,234 19,123 10,589 Total capital expenditures $ 62,450 $ 34,545 $ 21,157 December 31, (In thousands) 2021 2020 2019 On rent rental merchandise, net Rent-A-Center Business $ 477,901 $ 444,945 $ 411,482 Acima 676,279 299,660 268,845 Mexico 18,844 18,281 16,943 Total on rent rental merchandise, net $ 1,173,024 $ 762,886 $ 697,270 December 31, (In thousands) 2021 2020 2019 Held for rent rental merchandise, net Rent-A-Center Business $ 123,111 $ 136,219 $ 131,086 Acima 626 2,228 1,254 Mexico 9,247 7,819 6,078 Total held for rent rental merchandise, net $ 132,984 $ 146,266 $ 138,418 December 31, (In thousands) 2021 2020 2019 Assets by segment Rent-A-Center Business $ 1,026,886 $ 999,252 $ 953,151 Acima 1,476,752 389,650 357,859 Mexico 41,669 42,278 33,707 Franchising 15,412 14,729 11,095 Total segments 2,560,719 1,445,909 1,355,812 Corporate 432,608 305,071 226,986 Total assets $ 2,993,327 $ 1,750,980 $ 1,582,798 December 31, (In thousands) 2021 2020 2019 Assets by country United States $ 2,951,658 $ 1,708,702 $ 1,547,895 Mexico 41,669 42,278 33,707 Canada — — 1,196 Total assets $ 2,993,327 $ 1,750,980 $ 1,582,798 Year Ended December 31, (In thousands) 2021 2020 2019 Rentals and fees by inventory category Furniture and accessories $ 1,542,003 $ 1,028,876 $ 982,644 Consumer electronics 435,004 358,931 346,668 Appliances 426,316 322,261 358,619 Wheels and tires 280,132 — — Computers 155,313 119,015 103,171 Jewelry 146,477 — — Smartphones 61,058 59,205 62,948 Other products and services 476,150 374,803 370,352 Total rentals and fees $ 3,522,453 $ 2,263,091 $ 2,224,402 Year Ended December 31, (In thousands) 2021 2020 2019 Revenue by country United States $ 4,522,048 $ 2,763,608 $ 2,615,892 Mexico 61,403 50,583 53,960 Total revenues $ 4,583,451 $ 2,814,191 $ 2,669,852 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Common Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Summarized basic and diluted earnings per common share were calculated as follows: Year Ended December 31, (In thousands, except per share data) 2021 2020 2019 Numerator: Net earnings $ 134,940 $ 208,115 $ 173,546 Denominator: Weighted-average shares outstanding 57,053 54,187 54,325 Effect of dilutive stock awards 9,786 1,567 1,630 Weighted-average dilutive shares 66,839 55,754 55,955 Basic earnings per share $ 2.37 $ 3.84 $ 3.19 Diluted earnings per share $ 2.02 $ 3.73 $ 3.10 Anti-dilutive securities excluded from diluted earnings per common share: Anti-dilutive restricted share units 32 1 — Anti-dilutive performance share units 107 3 290 Anti-dilutive stock options 295 949 1,109 |
Nature of Operations and Summ_3
Nature of Operations and Summary of Accounting Policies (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021USD ($)store | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Nature of Operations [Abstract] | |||
Number of company-owned stores nationwide and in Puerto Rico | store | 1,846 | ||
Number of retail installment sales stores | store | 45 | ||
Number of stores in Mexico | store | 123 | ||
Number of Franchised stores | store | 466 | ||
Number of states with Franchised stores | 32 | ||
Rental merchandise, net [Abstract] | |||
Minimum Period in Held for Rent status needed for depreciation of merchandise | 180 days | ||
Maximum Period used for depreciation of Merchandise Held for Rent | 18 months | ||
Maximum Period used for depreciation of smartphones Held for Rent | 18 months | ||
Minimum Period in Held for Rent status needed for depreciation of smartphones | 90 days | ||
Maximum period of past due required to charge off remaining book value of rental merchandise for Rent-A-Center business and Mexico segments | 90 days | ||
Maximum period of past due required to charge off remaining book value of rental merchandise for Preferred Lease segment | 150 days | ||
Receivables and Allowance for Doubtful Accounts [Abstract] | |||
Minimum Period of Past Due Required to Charge Off installment Notes | 120 days | ||
Maximum period in current status allowed to Franchisees for payment of receivables | 30 days | ||
Minimum period of past due required to write off receivables from Franchisees | 90 days | ||
Major Property Class Useful Life [Line Items] | |||
Goodwill | $ 289,750 | $ 70,217 | $ 70,217 |
Goodwill and Other Intangibles [Abstract] | |||
Amortization period for acquired customer relationships | 21 months | ||
Amortization period for vendor relationships minimum | 7 years | ||
Amortization period for vendor relationships maximum | 10 years | ||
Advertising Costs [Abstract] | |||
Advertising Costs | $ 73,900 | 50,900 | 58,800 |
Vendor Allowances | 21,600 | 24,800 | $ 21,200 |
Major Property Class Useful Life [Table] | |||
Reserves for Merchandise Losses | $ 98,200 | 58,100 | |
Furniture, equipment and vehicle [Member] | |||
Major Property Class Useful Life [Line Items] | |||
Useful life | 5 years | ||
Internally Developed Software [Member] | |||
Major Property Class Useful Life [Line Items] | |||
Useful life | 10 years | ||
Rent-A-Center Business [Member] | |||
Major Property Class Useful Life [Line Items] | |||
Goodwill | $ 1,500 | ||
Acima Holdings | |||
Major Property Class Useful Life [Line Items] | |||
Goodwill | $ 288,300 | $ 68,700 |
Acquisitions and Divestitures_3
Acquisitions and Divestitures (Details) $ / shares in Units, $ in Thousands | Feb. 17, 2021USD ($)$ / sharesshares | Dec. 20, 2020USD ($) | Oct. 05, 2020USD ($)store | Aug. 13, 2019USD ($)$ / shares | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2021USD ($)store | Dec. 31, 2020USD ($)store | Dec. 31, 2019USD ($)store | Dec. 31, 2018USD ($) |
Acquisitions and Divestitures [Line Items] | ||||||||||
Working capital adjustment | $ 900 | |||||||||
Description of goodwill recognized | consists of the excess of the net purchase price over the fair value of the net assets acquired | |||||||||
Goodwill | $ 241,774 | $ 0 | ||||||||
Proceeds from sale of assets | 4 | 14,477 | $ 69,717 | |||||||
On rent | $ 1,173,024 | $ 762,886 | 1,173,024 | 762,886 | 697,270 | |||||
Property, Plant and Equipment, Net | 308,098 | 141,641 | 308,098 | 141,641 | ||||||
Loss (gain) on sale or disposal of property assets | (353) | (18,215) | 23,537 | |||||||
Accrued liabilities | 362,708 | 320,583 | 362,708 | 320,583 | ||||||
Deferred tax liability | 113,943 | 176,410 | 113,943 | 176,410 | ||||||
Allowance for doubtful accounts | 8,479 | 8,047 | 8,479 | 8,047 | 5,601 | $ 4,883 | ||||
Accounts Receivable, before Allowance for Credit Loss | 134,857 | 98,050 | 134,857 | 98,050 | ||||||
Total revenues | 4,583,451 | 2,814,191 | 2,669,852 | |||||||
Net earnings | 134,940 | 208,115 | 173,546 | |||||||
Operating Expenses | 1,954,473 | 1,434,816 | 1,390,212 | |||||||
Deferred tax asset | 68,391 | 33,782 | 68,391 | 33,782 | ||||||
Goodwill | 289,750 | 70,217 | 289,750 | 70,217 | 70,217 | |||||
Acquired intangible assets weighted average useful life | 10 years | |||||||||
Post purchase price allocation adjustments | (22,241) | 0 | ||||||||
Pro Forma | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Operating Expenses | 16,000 | 356,800 | ||||||||
Rent-A-Center Business [Member] | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Total purchase price | 278 | 700 | 504 | |||||||
Rental merchandise | 248 | 523 | $ 248 | $ 523 | $ 353 | |||||
Number of stores acquired remaining open | store | 1 | 0 | 0 | |||||||
Number of stores acquired that were merged with existing stores | store | 0 | 2 | 4 | |||||||
Number of transactions | store | 1 | 2 | 4 | |||||||
Goodwill | $ 0 | $ 0 | $ 66 | |||||||
On rent | 477,901 | 444,945 | 477,901 | 444,945 | 411,482 | |||||
Total revenues | 2,037,849 | 1,852,641 | 1,800,486 | |||||||
Goodwill | 1,500 | 1,500 | ||||||||
Rent-A-Center Business [Member] | Customer relationships [Member] | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Acquisition amounts allocated to finite-lived intangible assets | 30 | 177 | $ 85 | |||||||
CALIFORNIA | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Number of stores in California [Line Items] | store | 99 | |||||||||
Proceeds from sale of assets | $ 16,000 | |||||||||
On rent | 30,000 | |||||||||
Property, Plant and Equipment, Net | 800 | |||||||||
Loss (gain) on sale or disposal of property assets | $ 16,600 | |||||||||
Merchants Preferred [Member] | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Common stock consideration | 701,918 shares of our common stock | |||||||||
Common stock price | $ / shares | $ 27.31 | |||||||||
Aggregate purchase price | $ 46,400 | |||||||||
Description of acquired entity | a nationwide provider of virtual lease-to-own services | |||||||||
Total purchase price | $ 28,000 | |||||||||
Receivables | 1,813 | |||||||||
Prepaid expenses and other assets | 154 | |||||||||
Rental merchandise | 17,904 | |||||||||
Software | 4,300 | |||||||||
Right of use operating leases | 404 | |||||||||
Other intangible assets | 8,900 | |||||||||
Lease liabilities | 487 | |||||||||
Net identifiable assets acquired | 46,391 | |||||||||
Goodwill | $ 13,403 | |||||||||
Acquired entity | Merchants Preferred | |||||||||
Acima Holdings | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Common stock price | $ / shares | $ 51.14 | |||||||||
Aggregate purchase price | $ 1,394,192 | $ 1,400,000 | ||||||||
Description of acquired entity | Acima Holdings is a platform offering customers virtual lease-to-own solutions at the point-of-sale via web and mobile technology. | |||||||||
Total purchase price | $ 1,273,263 | |||||||||
Receivables | 25,255 | |||||||||
Prepaid expenses and other assets | 700 | |||||||||
Rental merchandise | 340,575 | |||||||||
Right of use operating leases | 9,136 | |||||||||
Other intangible assets | 520,000 | |||||||||
Goodwill | 219,530 | |||||||||
Lease liabilities | (9,689) | |||||||||
Net identifiable assets acquired | $ (1,394,192) | |||||||||
Description of goodwill recognized | which consists of the excess of the net purchase price over the fair value of the net assets acquired. Goodwill represents expected cost and revenue synergies and other benefits expected to result within our retail partner business from the acquisition of Acima Holdings. | |||||||||
Acquisition related expenses | $ 23,700 | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | 120,929 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 171,455 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 1,315,210 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | 16,023 | |||||||||
Accrued liabilities | 11,716 | |||||||||
Business Combination Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Assets | (116,410) | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | $ (78,982) | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 10,779,923 | |||||||||
Allowance for doubtful accounts | $ 34,700 | |||||||||
Accounts Receivable, before Allowance for Credit Loss | 61,600 | |||||||||
Business Acquisition, Pro Forma Revenue | 4,778,055 | 4,071,990 | ||||||||
Business Acquisition, Pro Forma Net Income (Loss) | 178,103 | $ 66,352 | ||||||||
Total revenues | 1,495,746 | 1,116,430 | ||||||||
Net earnings | $ 119,183 | $ 196,088 | ||||||||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustments Related to Previous Period | 17,100 | |||||||||
Deferred tax asset | 28,559 | |||||||||
Business Combination, Provisional Information, Initial Accounting Incomplete, Adjustment, Inventory | 14,300 | |||||||||
Goodwill | $ 219,500 | |||||||||
Acquired intangible assets weighted average useful life | 8 years | |||||||||
Post purchase price allocation adjustments | $ (22,200) | |||||||||
Acima Holdings | Software and Software Development Costs | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 170,000 | |||||||||
Acima Holdings | Share-based Payment Arrangement | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 2,683,328 | |||||||||
Acima Holdings | Restricted Stock Units (RSUs) [Member] | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 414,100 | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 8,096,595 | |||||||||
Acima Holdings | Contract-Based Intangible Assets | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Other intangible assets | $ 380,000 | |||||||||
Acquired intangible assets weighted average useful life | 10 years | |||||||||
Acima Holdings | Customer Contracts | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Other intangible assets | $ 60,000 | |||||||||
Acquired intangible assets weighted average useful life | 1 year | |||||||||
Acima Holdings | Trade Names | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Other intangible assets | $ 40,000 | |||||||||
Acquired intangible assets weighted average useful life | 7 years | |||||||||
Acima Holdings | Non-compete agreements [Member] | ||||||||||
Acquisitions and Divestitures [Line Items] | ||||||||||
Other intangible assets | $ 40,000 | |||||||||
Acquired intangible assets weighted average useful life | 3 years |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Rentals and fees | $ 3,522,453 | $ 2,263,091 | $ 2,224,402 |
Merchandise sales | 829,222 | 378,717 | 304,630 |
Installment sales | 73,585 | 68,500 | 70,434 |
Other | 4,148 | 3,845 | 4,795 |
Total store revenues | 4,429,408 | 2,714,153 | 2,604,261 |
Merchandise sales | 126,856 | 80,023 | 49,135 |
Royalty income and fees | 27,187 | 20,015 | 16,456 |
Total revenues | 4,583,451 | 2,814,191 | 2,669,852 |
Rental Purchase Agreement Deferred Revenue | 51,700 | 45,800 | |
Other Deferred Revenue | 2,600 | 3,100 | |
Franchise Fee Deferred Revenue | 4,100 | 4,700 | |
Rent-A-Center Business [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Rentals and fees | 1,762,847 | 1,604,615 | 1,585,997 |
Merchandise sales | 199,781 | 177,223 | 140,372 |
Installment sales | 73,585 | 68,500 | 70,434 |
Other | 1,636 | 2,303 | 3,683 |
Total store revenues | 2,037,849 | 1,852,641 | 1,800,486 |
Merchandise sales | 0 | 0 | 0 |
Royalty income and fees | 0 | 0 | 0 |
Total revenues | 2,037,849 | 1,852,641 | 1,800,486 |
Mexico [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Rentals and fees | 58,074 | 47,568 | 50,903 |
Merchandise sales | 3,275 | 2,977 | 3,023 |
Installment sales | 0 | 0 | 0 |
Other | 54 | 38 | 34 |
Total store revenues | 61,403 | 50,583 | 53,960 |
Merchandise sales | 0 | 0 | 0 |
Royalty income and fees | 0 | 0 | 0 |
Total revenues | 61,403 | 50,583 | 53,960 |
Franchising [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Rentals and fees | 0 | 0 | 0 |
Merchandise sales | 0 | 0 | 0 |
Installment sales | 0 | 0 | 0 |
Other | 2,067 | 778 | 555 |
Total store revenues | 2,067 | 778 | 555 |
Merchandise sales | 126,856 | 80,023 | 49,135 |
Royalty income and fees | 27,187 | 20,015 | 16,456 |
Total revenues | 156,110 | 100,816 | 66,146 |
Acima Holdings | |||
Disaggregation of Revenue [Line Items] | |||
Rentals and fees | 1,701,532 | 610,908 | 587,502 |
Merchandise sales | 626,166 | 198,517 | 161,235 |
Installment sales | 0 | 0 | 0 |
Other | 391 | 726 | 523 |
Total store revenues | 2,328,089 | 810,151 | 749,260 |
Merchandise sales | 0 | 0 | 0 |
Royalty income and fees | 0 | 0 | 0 |
Total revenues | $ 2,328,089 | $ 810,151 | $ 749,260 |
Receivables and Allowance for_3
Receivables and Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Receivables [Line Items] | ||||
Proceeds from Interest Received | $ 12,200 | $ 11,500 | $ 10,800 | |
Accounts Receivable, before Allowance for Credit Loss | 134,857 | 98,050 | ||
Accounts Receivable, after Allowance for Credit Loss | 126,378 | 90,003 | ||
Changes in allowance for doubtful accounts [Roll Forward] | ||||
Bad debt expense | 14,397 | 14,635 | 15,077 | |
Accounts written off | (13,965) | (12,190) | (14,359) | |
Allowance for doubtful accounts | (8,479) | (8,047) | $ (5,601) | $ (4,883) |
Installment sales receivable | ||||
Receivables [Line Items] | ||||
Accounts Receivable, before Allowance for Credit Loss | 66,276 | 61,794 | ||
Changes in allowance for doubtful accounts [Roll Forward] | ||||
Allowance for doubtful accounts | (7,600) | (7,000) | ||
Trade and notes receivables | ||||
Receivables [Line Items] | ||||
Accounts Receivable, before Allowance for Credit Loss | 68,581 | 36,256 | ||
Changes in allowance for doubtful accounts [Roll Forward] | ||||
Allowance for doubtful accounts | $ (900) | $ (1,000) |
Rental Merchandise Rental (Deta
Rental Merchandise Rental (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Rental Merchandise [Abstract] | |||
Cost | $ 1,894,247 | $ 1,169,333 | |
Less accumulated depreciation | (721,223) | (406,447) | |
Net book value, on rent | 1,173,024 | 762,886 | $ 697,270 |
Cost | 155,832 | 165,879 | |
Less accumulated depreciation | (22,848) | (19,613) | |
Net book value, held for rent | $ 132,984 | $ 146,266 | $ 138,418 |
Property Assets (Details)
Property Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Feb. 17, 2021 | |
Property, Plant and Equipment [Line Items] | ||||
Software | $ 468,011 | $ 279,141 | ||
Building and leasehold improvements | 199,280 | 196,179 | ||
Furniture and equipment | 172,418 | 163,623 | ||
Transportation equipment | 549 | 503 | ||
Construction in progress | 25,293 | 7,269 | ||
Total property assets | 865,551 | 646,715 | ||
Less accumulated depreciation | (557,453) | (505,074) | ||
Total property assets, net of accumulated depreciation | 308,098 | 141,641 | ||
Capitalized software costs included in construction in progress | 21,600 | 4,800 | ||
Cost of internally developed software placed in service | $ 12,300 | $ 9,500 | $ 6,000 | |
Acima Holdings | ||||
Property, Plant and Equipment [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 171,455 | |||
Software and Software Development Costs | Acima Holdings | ||||
Property, Plant and Equipment [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 170,000 |
Leases (Details)
Leases (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021USD ($)store | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Operating lease charges | $ 117,713 | $ 131,695 | $ 149,853 |
Sublease receipts | (11,806) | (9,727) | (7,683) |
Cash paid for amounts included in measurement of operating lease liabilities | 107,588 | 113,243 | 120,826 |
Cash paid for short-term operating leases not included in operating lease liabilities | 17,266 | 22,339 | 27,402 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 100,779 | $ 104,771 | $ 78,250 |
Weighted-average discount rate(1) | 6.00% | 6.80% | 7.70% |
Weighted-average remaining lease term (in years) | 4 years | 4 years | 4 years |
2022 | $ 106,505 | ||
2023 | 83,248 | ||
2024 | 64,693 | ||
2025 | 47,248 | ||
2026 | 23,077 | ||
Thereafter | 17,266 | ||
Total undiscounted operating lease liabilities | 342,037 | ||
Less: Interest | (45,502) | ||
Operating lease liabilities | $ 296,535 | $ 285,354 | |
Operating lease, number of units | store | 500 | ||
COVID Rent Abatement | $ 2,300 | ||
COVID Rent Deferral | 2,100 | ||
Variable Lease, Cost | 33,700 | 34,600 | |
Operating lease cost included in other store expenses(1)(2) | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease charges | 129,217 | 140,186 | $ 148,314 |
Operating lease cost included in other charges(2) | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease charges | $ 302 | $ 1,236 | $ 9,222 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Intangible Assets and Acquisitions [Line Items] | |||
Goodwill | $ 289,750 | $ 70,217 | $ 70,217 |
Additions from acquisitions | 241,774 | 0 | |
Post purchase price allocation adjustments | (22,241) | 0 | |
Gross carrying amount | 616,518 | 96,487 | |
Accumulated amortization | 191,360 | 88,618 | |
Amortization of intangibles | 102,742 | 1,070 | 723 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Rolling Maturity [Abstract] | |||
2022 | 65,850 | ||
2023 | 57,938 | ||
2024 | 46,350 | ||
2025 | 44,604 | ||
2026 | 44,604 | ||
Thereafter | 165,812 | ||
Other intangible assets, net | 425,158 | 7,869 | |
Rent-A-Center Business [Member] | |||
Intangible Assets and Acquisitions [Line Items] | |||
Goodwill | 1,500 | ||
Additions from acquisitions | 0 | 0 | $ 66 |
Acima Holdings | |||
Intangible Assets and Acquisitions [Line Items] | |||
Goodwill | $ 288,300 | 68,700 | |
Customer relationships [Member] | |||
Intangible Assets and Acquisitions [Line Items] | |||
Average life | 2 years | ||
Gross carrying amount | $ 140,039 | 80,008 | |
Accumulated amortization | $ 132,127 | 79,853 | |
Merchant relationships [Member] | |||
Intangible Assets and Acquisitions [Line Items] | |||
Average life | 10 years | ||
Gross carrying amount | $ 389,760 | 9,760 | |
Accumulated amortization | $ 35,960 | 2,046 | |
Tradename | |||
Intangible Assets and Acquisitions [Line Items] | |||
Average life | 7 years | ||
Gross carrying amount | $ 40,000 | 0 | |
Accumulated amortization | $ 4,966 | 0 | |
Non-compete agreements [Member] | |||
Intangible Assets and Acquisitions [Line Items] | |||
Average life | 3 years | ||
Gross carrying amount | $ 46,719 | 6,719 | |
Accumulated amortization | $ 18,307 | $ 6,719 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Accrued Liabilities [Abstract] | ||
Accrued insurance costs | $ 89,621 | $ 94,744 |
Deferred revenue | 71,376 | 61,066 |
Taxes other than income | 49,708 | 48,038 |
Accrued compensation | 46,750 | 48,027 |
Accrued dividends | 27,801 | 17,003 |
Accrued legal settlement | 22,500 | 5,440 |
Accrued interest payable | 11,993 | 1,041 |
Deferred compensation | 10,349 | 9,437 |
Accrued other | 32,610 | 35,787 |
Accrued liabilities | $ 362,708 | $ 320,583 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Taxes [Abstract] | ||||
Domestic | $ 176,042 | $ 212,859 | $ 212,406 | |
Foreign | 18,262 | 9,920 | 11,377 | |
Earnings before income taxes | $ 194,304 | $ 222,779 | $ 223,783 | |
Tax at statutory rate | 21.00% | 21.00% | 21.00% | |
Effective Income Tax Rate Reconciliation, Tax Expense (Benefit), Share-based Payment Arrangement, Percent | 11.60% | 0.00% | 0.00% | |
State income taxes | 7.40% | 2.80% | 4.30% | |
Effect of foreign operations | 2.00% | (0.30%) | 0.30% | |
Effect of current and prior year credits | (2.40%) | (0.80%) | (2.70%) | |
Change in unrecognized tax benefits | (2.80%) | 0.30% | 0.00% | |
Other permanent differences | 0.30% | (0.70%) | 0.20% | |
Prior year return to provision adjustments | (0.20%) | 1.10% | (2.70%) | |
Benefit of CARES Act | 0.00% | (7.50%) | 0.00% | |
Valuation allowance | (7.10%) | (9.30%) | 1.20% | |
Other, net | 0.80% | 0.00% | 0.80% | |
Effective income tax rate | 30.60% | 6.60% | 22.40% | |
Federal | $ (7,398) | $ 14,354 | $ (6,996) | |
State | 15,106 | 4,735 | 528 | |
Foreign | 3,690 | 1,608 | 796 | |
Total current | 11,398 | 20,697 | (5,672) | |
Federal | 56,716 | 12,576 | 37,309 | |
State | (1,205) | (2,956) | 16,439 | |
Foreign | (7,545) | (15,653) | 2,161 | |
Total deferred | 47,966 | (6,033) | 55,909 | |
Total income tax expense (benefit) | 59,364 | 14,664 | 50,237 | |
Net operating loss carryforwards | 35,834 | 32,834 | ||
Accrued liabilities | 48,659 | 45,776 | ||
Intangible assets | 165,135 | 9,676 | ||
Lease obligations | 73,819 | 67,999 | ||
Other assets including credits | 12,157 | 10,079 | ||
Foreign tax credit carryforwards | 7,696 | 5,643 | ||
Total deferred tax assets | 343,300 | 172,007 | ||
Valuation allowance | (7,688) | (21,645) | ||
Deferred tax assets, net | 335,612 | 150,362 | ||
Rental merchandise | (288,504) | (206,833) | ||
Property assets | (20,094) | (18,935) | ||
Lease assets | (72,458) | (66,661) | ||
Other liabilities | (108) | (561) | ||
Total deferred tax liabilities | (381,164) | (292,990) | ||
Net deferred taxes | (45,552) | (142,628) | ||
Operating Loss Carryforwards [Line Items] | ||||
Tax benefits, if recognized, affect annual effective tax rate | 2,200 | |||
Tax credit carryforward | 15,600 | |||
Income taxes refunded | 1,571 | 32,318 | 2,074 | |
Interest expense related to unrecognized tax benefits | 1,200 | |||
Unrecognized tax benefit balance | 6,536 | 22,184 | 24,208 | $ 36,364 |
Reductions based on tax positions related to current year | (461) | 1,204 | (654) | |
Additions for tax positions of prior years | 4,119 | 45 | 415 | |
Reductions for tax positions of prior years | (3,006) | (2,086) | (11,917) | |
Settlements | (17,222) | $ (1,187) | $ 0 | |
Accrued for payment of interest related to unrecognized tax benefits | 2,600 | |||
State [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | 239,000 | |||
Foreign [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | 37,000 | |||
Domestic Tax Authority | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | $ 52,000 |
Senior Debt (Details)
Senior Debt (Details) - USD ($) | Sep. 21, 2021 | Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Feb. 17, 2021 |
Debt Instrument [Line Items] | ||||||
Original issue discount | $ 4,400,000 | |||||
Debt issuance costs | $ 1,500,000 | 30,200,000 | ||||
Unamortized debt issuance expense | $ 23,231,000 | $ 23,231,000 | $ 7,010,000 | |||
Letters of credit, amount outstanding | 86,400,000 | 86,400,000 | 90,700,000 | |||
Senior debt, net | 1,135,207,000 | 1,135,207,000 | 190,490,000 | |||
Debt and Lease Obligation | 1,158,438,000 | $ 1,158,438,000 | ||||
Line of credit commitment fee percentage | 0.375% | |||||
Line of credit commitment fee | 800,000 | |||||
Other charges and (gains) | $ 289,913,000 | 36,555,000 | $ (60,728,000) | |||
Debt refinancing charges | 1,400,000 | 15,582,000 | 0 | 2,168,000 | ||
Write-off of debt financing fees | 5,400,000 | 9,926,000 | 0 | $ 2,168,000 | ||
2022 | 8,750,000 | 8,750,000 | ||||
2023 | 8,750,000 | 8,750,000 | ||||
2024 | 8,750,000 | 8,750,000 | ||||
2025 | 8,750,000 | 8,750,000 | ||||
2026 | 298,750,000 | 298,750,000 | ||||
Thereafter | 824,688,000 | 824,688,000 | ||||
Debt Issuance Costs [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unamortized debt issuance expense | $ (100,000) | (20,300,000) | (20,300,000) | (25,300,000) | ||
Other charges and (gains) | 4,900,000 | |||||
Original Issue Discount [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Unamortized debt issuance expense | (2,900,000) | $ (2,900,000) | ||||
Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit commitment fee percentage | 0.25% | |||||
Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit commitment fee percentage | 0.375% | |||||
Term loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 875,000,000 | $ 875,000,000 | 0 | |||
Maturity date | Feb. 17, 2028 | |||||
Debt and Lease Obligation | 868,438,000 | $ 868,438,000 | 0 | |||
Long-term Debt, Gross | 875,000,000 | |||||
Frequency of periodic payment | quarterly | |||||
Periodic Payment, Percent | 1.00% | |||||
Debt Instrument, Unused Borrowing Capacity, Fee | $ 0 | 0 | ||||
2022 | 8,750,000 | 8,750,000 | ||||
2023 | 8,750,000 | 8,750,000 | ||||
2024 | 8,750,000 | 8,750,000 | ||||
2025 | 8,750,000 | 8,750,000 | ||||
2026 | 8,750,000 | 8,750,000 | ||||
Thereafter | 824,688,000 | $ 824,688,000 | ||||
Term loan [Member] | Eurodollar [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 3.25% | |||||
Term loan [Member] | Eurodollar [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 3.25% | |||||
Term loan [Member] | Eurodollar [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 4.00% | |||||
Term loan [Member] | LIBOR [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 0.50% | |||||
Term loan [Member] | LIBOR [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 0.50% | |||||
Term loan [Member] | LIBOR [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 0.75% | |||||
ABL credit facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
ABL credit facility availability | 173,600,000 | $ 173,600,000 | ||||
Maximum borrowing capacity | 550,000,000 | $ 550,000,000 | 300,000,000 | |||
Maturity date | Feb. 17, 2026 | |||||
Debt and Lease Obligation | $ 290,000,000 | $ 290,000,000 | 0 | |||
Required minimum consolidated fixed charge coverage ratio | 1.10 | 1.10 | ||||
Actual fixed charge coverage ratio | 1.07 | 1.07 | ||||
Line of Credit Facility, Current Borrowing Capacity | $ 550,000,000 | |||||
Actual margin on variable rate | 1.875% | 1.875% | ||||
Debt Instrument, Unused Borrowing Capacity, Fee | $ 173,616,000 | 209,268,000 | ||||
2022 | $ 0 | 0 | ||||
2023 | 0 | 0 | ||||
2024 | 0 | 0 | ||||
2025 | 0 | 0 | ||||
2026 | 290,000,000 | 290,000,000 | ||||
Thereafter | 0 | $ 0 | ||||
ABL credit facility [Member] | Eurodollar [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 1.50% | |||||
ABL credit facility [Member] | Eurodollar [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis margin on variable rate | 2.00% | |||||
Term Loan and Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 1,425,000,000 | $ 1,425,000,000 | 500,000,000 | |||
Debt and Lease Obligation | 1,158,438,000 | 1,158,438,000 | 197,500,000 | |||
Debt Instrument, Unused Borrowing Capacity, Fee | 173,616,000 | 209,268,000 | ||||
Prior Senior Loan | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 0 | $ 0 | 200,000,000 | |||
Maturity date | ||||||
Debt and Lease Obligation | $ 0 | $ 0 | 197,500,000 | |||
Debt Instrument, Unused Borrowing Capacity, Fee | $ 0 | $ 0 |
Senior Notes (Details)
Senior Notes (Details) - Senior Notes - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Feb. 17, 2021 | |
Senior Notes [Line Items] | ||
Initial borrowing in senior notes | $ 450,000 | $ 450,000 |
Debt Instrument, Redemption Price, Percentage | 106.375% | |
Debt Instrument, Interest Rate, Stated Percentage | 6.375% |
Other Charges and (Gains) (Deta
Other Charges and (Gains) (Details) $ in Thousands | Feb. 17, 2021USD ($)shares | Oct. 05, 2020USD ($)store | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($)store | Dec. 31, 2019USD ($) |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | $ 28,661 | $ 8,978 | |||
Proceeds from sale of assets | 4 | 14,477 | $ 69,717 | ||
Royalty income and fees | 27,187 | 20,015 | 16,456 | ||
On rent | 1,173,024 | 762,886 | 697,270 | ||
Property assets, net of accumulated depreciation of $557,453 and $505,074 in 2021 and 2020, respectively | 308,098 | 141,641 | |||
Loss (gain) on sale or disposal of property assets | (353) | (18,215) | 23,537 | ||
Restructuring Reserve | 1,593 | 5,349 | 738 | ||
Restructuring payments | 32,417 | 4,367 | |||
Acima Holdings restricted stock agreements(3) | 147,554 | 12,284 | 6,958 | ||
Depreciation and amortization of acquired assets(4) | 54,830 | 56,658 | 61,104 | ||
Other charges and (gains) | 289,913 | 36,555 | (60,728) | ||
Depreciation for property assets | 67,091 | 55,597 | 60,592 | ||
Acima Holdings | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 1,500 | ||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 10,779,923 | ||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 120,929 | ||||
Other intangible assets | 520,000 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 171,455 | ||||
Amortization | 101,700 | ||||
Acima Holdings restricted stock agreements(3) | 127,100 | ||||
Depreciation for property assets | 13,200 | ||||
Acima Holdings | Software and Software Development Costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 170,000 | ||||
Acima Holdings | Restricted Stock Units (RSUs) [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 8,096,595 | ||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 414,100 | ||||
CALIFORNIA | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of stores in California [Line Items] | store | 99 | ||||
Proceeds from sale of assets | $ 16,000 | ||||
Royalty income and fees | 1,000 | ||||
On rent | 30,000 | ||||
Property assets, net of accumulated depreciation of $557,453 and $505,074 in 2021 and 2020, respectively | 800 | ||||
Loss (gain) on sale or disposal of property assets | $ 16,600 | ||||
Sale of California Stores [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 16,600 | ||||
Acima [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 6,400 | ||||
Legal settlement reserves [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 17,500 | 7,900 | |||
State tax audit assessments [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 200 | 1,200 | |||
COVID-19 Pandemic [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 1,400 | ||||
Sale of class action claim [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 2,800 | ||||
Insurance proceeds [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 300 | ||||
Acima Holdings transaction costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 17,680 | 6,400 | |||
Restructuring Reserve | 0 | 5,005 | 0 | ||
Restructuring payments | 22,685 | 1,395 | |||
Acima Holdings transaction costs | Acima Holdings | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 17,700 | ||||
Acima Holdings integration costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 6,572 | 0 | |||
Restructuring Reserve | 0 | 0 | 0 | ||
Restructuring payments | 6,572 | 0 | |||
Acima Holdings integration costs | Acima Holdings | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 10,300 | ||||
Labor reduction costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 3,751 | 1,334 | |||
Restructuring Reserve | 1,593 | 344 | 738 | ||
Restructuring payments | 2,502 | 1,728 | |||
Labor reduction costs | Acima Holdings | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 3,700 | ||||
Lease obligation costs(1) | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 0 | (645) | |||
Restructuring Reserve | 0 | 0 | 0 | ||
Restructuring payments | 0 | (645) | |||
Contract termination costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 0 | 0 | |||
Restructuring Reserve | 0 | 0 | 0 | ||
Restructuring payments | 0 | 0 | |||
Other cash charges(2) | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 658 | 1,889 | |||
Restructuring Reserve | 0 | 0 | 0 | ||
Restructuring payments | 658 | 1,889 | |||
Inventory Valuation and Obsolescence | Acima Holdings | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 5,100 | ||||
Rent-A-Center Business [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Royalty income and fees | 0 | 0 | 0 | ||
On rent | 477,901 | 444,945 | 411,482 | ||
Depreciation and amortization of acquired assets(4) | 18,588 | 19,912 | 20,822 | ||
Mexico [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Royalty income and fees | 0 | 0 | 0 | ||
On rent | 18,844 | 18,281 | 16,943 | ||
Depreciation and amortization of acquired assets(4) | 511 | 413 | $ 401 | ||
Store Consolidation Plan [Member] | Labor reduction costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 100 | ||||
Store Consolidation Plan [Member] | Other cash charges(2) | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 1,500 | ||||
Store Consolidation Plan [Member] | Disposal of fixed assets [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Asset impairments(5) | $ 100 | ||||
Store Consolidation Plan [Member] | Rent-A-Center Business [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of stores closed | store | 28 | ||||
Cost Savings Initiative [Member] | Labor reduction costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | $ 800 | ||||
Cost Savings Initiative [Member] | Other cash charges(2) | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 400 | ||||
COVID-19 Pandemic [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 1,400 | ||||
Payments for Rent | 800 | ||||
COVID-19 Pandemic [Member] | Labor reduction costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 400 | ||||
COVID-19 Pandemic [Member] | Lease obligation costs(1) | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring cash charges | 200 | ||||
Social Unrest [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Rental merchandise losses(6) | 900 | ||||
Social Unrest [Member] | Disposal of fixed assets [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Asset impairments(5) | $ 100 | ||||
Social Unrest [Member] | Rent-A-Center Business [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of stores closed | store | 30 | ||||
Non-Cash Charges [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Other | 17,661 | $ 23,968 | |||
Acima Holdings restricted stock agreements(3) | 127,060 | 0 | |||
Depreciation and amortization of acquired assets(4) | 114,959 | 0 | |||
Asset impairments(5) | 1,572 | 2,749 | |||
Rental merchandise losses(6) | $ 0 | 860 | |||
Non-Cash Charges [Member] | Store Consolidation Plan [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Asset impairments(5) | 400 | ||||
Non-Cash Charges [Member] | Cost Savings Initiative [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Asset impairments(5) | $ 400 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | Feb. 17, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options outstanding | 1,121,489 | 1,658,165 | ||
Exercise period of options once vested | 10 years | |||
Stock-based compensation expense | $ 147,554,000 | $ 12,284,000 | $ 6,958,000 | |
Tax benefit recognized in the statements of earnings | 58,963,000 | 3,062,000 | 1,562,000 | |
Share-based compensation expense, net of tax | $ 88,591,000 | $ 9,222,000 | 5,396,000 | |
Stock options granted | 97,250 | |||
Exercise of stock options, shares | (476,398) | |||
Stock options forfeited | (138,237) | |||
Stock options expired | (19,291) | |||
Stock options outstanding, weighted average exercise price | $ 22.68 | $ 22.91 | ||
Stock options granted, weighted average exercise price | 45.37 | |||
Stock options exercised, weighted average exercise price | 25.30 | |||
Stock options forfeited, weighted average exercise price | 31.45 | |||
Stock options expired, weighted average exercise price | $ 29.19 | |||
Stock options outstanding, weighted average remaining contractual life | 6 years 8 months 12 days | |||
Stock options outstanding, aggregate intrinsic value | $ 29,691,000 | |||
Stock options exercisable | 525,801 | |||
Stock options exercisable, weighted average exercise price | $ 19.65 | |||
Stock options exercisable, weighted average remaining contractual life | 5 years 4 months 2 days | |||
Stock options exercisable, aggregate intrinsic value | $ 15,384,000 | |||
Stock options exercised, intrinsic value | 14,300,000 | $ 5,800,000 | 5,100,000 | |
Tax benefits from exercise of stock options | $ 5,000,000 | $ 2,000,000 | $ 1,800,000 | |
Weighted average grant date fair value | $ 14.94 | $ 7.28 | $ 8.92 | |
Weighted average risk free interest rate | 0.49% | 0.93% | 2.07% | |
Weighted average expected dividend yield | 2.87% | 4.75% | 1.28% | |
Weighted average expected volatility | 50.29% | 49.44% | 50.93% | |
Weighted average expected life (in years) | 4 years 7 months 13 days | 4 years 7 months 13 days | 4 years 7 months 17 days | |
Restricted share units outstanding | 9,209,257 | 1,383,951 | ||
Restricted share units granted | 8,599,682 | |||
Restricted share units vested | (690,957) | |||
Restricted share units forfeited | (83,419) | |||
Restricted share units outstanding, weighted average exercise price | $ 50.33 | $ 20.09 | ||
Restricted share units granted, weighted average exercise price | 53.03 | |||
Restricted share units vested, weighted average exercise price | 24.12 | |||
Restricted share units forfeited, weighted average exercise price | $ 45.11 | |||
Acima Holdings | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 127,100,000 | |||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 10,779,923 | |||
Common stock price | $ 51.14 | |||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 120,929,000 | |||
Acima Holdings | Share-based Payment Arrangement | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 2,683,328 | |||
Acima Holdings | Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 8,096,595 | |||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 414,100,000 | |||
2016 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options outstanding | 2,184,396 | 2,767,703 | ||
2021 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized to issue | 5,000,000 | |||
Stock options outstanding | 100,822 | |||
2006 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options outstanding | 83,757 | 263,657 | ||
Equity Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options outstanding | 63,065 | 231,454 | ||
Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of options granted | 1 year | |||
Vesting % of performance based restricted stock units | 0.00% | |||
Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period of options granted | 4 years | |||
Vesting % of performance based restricted stock units | 200.00% | |||
Stock options [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 2,001,000 | $ 1,878,000 | $ 1,273,000 | |
Unvested awards - to result in compensation expense | $ 3,300,000 | |||
Weighted average number of years to vesting | 2 years 3 months 7 days | |||
Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 145,553,000 | $ 10,406,000 | $ 5,685,000 | |
Unvested awards - to result in compensation expense | $ 317,500,000 | |||
Weighted average number of years to vesting | 2 years 1 month 9 days |
Deferred Compensation Plan (Det
Deferred Compensation Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred Compensation Plan [Abstract] | |||
Maximum Deferral Percentage of Base Compensation under Deferred Compensation Plan | 50.00% | ||
Maximum Deferral Percentage of Bonus Compensation under Deferred Compensation Plan | 100.00% | ||
Contributions by Employer under Deferred Compensation Plan | $ 170 | $ 160 | $ 150 |
Employer match under Deferred Compensation Plan, Percent | 50.00% | ||
Employee Contribution Maximum Percent of Compensation under Deferred Compensation Plan | 6.00% | ||
Discretionary Contribution under Deferred Compensation Plan | $ 0 | ||
Deferred compensation | 10,349 | 9,437 | |
Deferred Compensation Plan Assets | $ 10,400 | $ 9,500 |
401(k) Plan (Details)
401(k) Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
401(k) Plan [Abstract] | |||
Maximum contribution % of eligible pre-tax compensation allowed to participants of defined contribution plan | 50.00% | ||
Employer match | $ 6.4 | $ 5.5 | $ 6.6 |
Employer match, percent | 50.00% | ||
Employer match, percent of employees' compensation | 6.00% | ||
Percent of company stock purchased | 6.90% | 8.20% |
Fair Value (Details)
Fair Value (Details) - Senior Notes - USD ($) $ in Thousands | Dec. 31, 2021 | Feb. 17, 2021 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Initial borrowing in senior notes | $ 450,000 | $ 450,000 |
Debt Instrument, Fair Value Disclosure | 469,125 | |
Amount Of Difference Between Fair Value And Carrying Value | $ 19,125 |
Stock Repurchase Plan (Details)
Stock Repurchase Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Repurchase Program | |||
Common stock repurchased, shares | 1,463,377 | ||
Treasury Stock, Value, Acquired, Cost Method | $ 390,112 | $ 26,586 | $ (1,292) |
Share Repurchase 250 million | |||
Repurchase Program | |||
Authorized common stock repurchase amount | $ 250,000 | ||
Common stock repurchased, shares | 5,069,108 | ||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 360,000 | ||
Treasury Stock, Value, Acquired, Cost Method | $ 26,600 | ||
Share Repurchase 500 million | |||
Repurchase Program | |||
Authorized common stock repurchase amount | $ 500,000 | ||
Common stock repurchased, shares | 2,829,700 | ||
Treasury Stock, Value, Acquired, Cost Method | $ 140,000 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 10 Months Ended | 12 Months Ended | |||
Dec. 31, 2021USD ($)store | Dec. 31, 2020USD ($) | Dec. 31, 2021USD ($)store | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | |||||
Total revenues | $ 4,583,451 | $ 2,814,191 | $ 2,669,852 | ||
Gross profit | 2,235,012 | 1,672,152 | 1,644,071 | ||
Operating profit | 280,539 | 237,336 | 253,859 | ||
Depreciation, Amortization and Write-down of Intangibles | 54,830 | 56,658 | 61,104 | ||
Capital expenditures | 62,450 | 34,545 | 21,157 | ||
On rent | $ 1,173,024 | $ 762,886 | 1,173,024 | 762,886 | 697,270 |
Held for rent | 132,984 | 146,266 | 132,984 | 146,266 | 138,418 |
Assets | $ 2,993,327 | 1,750,980 | 2,993,327 | 1,750,980 | 1,582,798 |
Rentals and fees | 3,522,453 | 2,263,091 | 2,224,402 | ||
Depreciation for property assets | 67,091 | 55,597 | 60,592 | ||
Stock-based compensation expense | $ 147,554 | 12,284 | 6,958 | ||
Number of retail installment sales stores | store | 45 | 45 | |||
Royalty Fee Percentage Minimum | 2.00% | ||||
Royalty Fee Percentage Maximum | 6.00% | ||||
Non-Cash Charges [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Depreciation, Amortization and Write-down of Intangibles | $ 114,959 | 0 | |||
Stock-based compensation expense | 127,060 | 0 | |||
Acima Holdings | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | $ 1,495,746 | 1,116,430 | |||
Amortization | 101,700 | ||||
Depreciation for property assets | 13,200 | ||||
Stock-based compensation expense | 127,100 | ||||
Furniture and accessories | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 1,542,003 | 1,028,876 | 982,644 | ||
Consumer electronics | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 435,004 | 358,931 | 346,668 | ||
Appliances | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 426,316 | 322,261 | 358,619 | ||
Wheels and tires | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 280,132 | 0 | 0 | ||
Computers | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 155,313 | 119,015 | 103,171 | ||
Jewelry | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 146,477 | 0 | 0 | ||
Smartphones | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 61,058 | 59,205 | 62,948 | ||
Other products and services | |||||
Segment Reporting Information [Line Items] | |||||
Rentals and fees | 476,150 | 374,803 | 370,352 | ||
Rent-A-Center Business [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 2,037,849 | 1,852,641 | 1,800,486 | ||
Gross profit | 1,433,536 | 1,294,695 | 1,255,153 | ||
Operating profit | 448,905 | 333,379 | 235,964 | ||
Depreciation, Amortization and Write-down of Intangibles | 18,588 | 19,912 | 20,822 | ||
Capital expenditures | 23,139 | 14,869 | 10,255 | ||
On rent | 477,901 | 444,945 | 477,901 | 444,945 | 411,482 |
Held for rent | 123,111 | 136,219 | 123,111 | 136,219 | 131,086 |
Assets | 1,026,886 | 999,252 | 1,026,886 | 999,252 | 953,151 |
Rentals and fees | 1,762,847 | 1,604,615 | 1,585,997 | ||
Mexico [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 61,403 | 50,583 | 53,960 | ||
Gross profit | 43,117 | 35,665 | 37,488 | ||
Operating profit | 7,858 | 5,798 | 5,357 | ||
Depreciation, Amortization and Write-down of Intangibles | 511 | 413 | 401 | ||
Capital expenditures | 1,032 | 392 | 172 | ||
On rent | 18,844 | 18,281 | 18,844 | 18,281 | 16,943 |
Held for rent | 9,247 | 7,819 | 9,247 | 7,819 | 6,078 |
Assets | 41,669 | 42,278 | 41,669 | 42,278 | 33,707 |
Rentals and fees | 58,074 | 47,568 | 50,903 | ||
Franchising [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 156,110 | 100,816 | 66,146 | ||
Gross profit | 29,507 | 20,682 | 17,632 | ||
Operating profit | 20,321 | 12,570 | 7,205 | ||
Depreciation, Amortization and Write-down of Intangibles | 93 | 40 | 45 | ||
Assets | 15,412 | 14,729 | 15,412 | 14,729 | 11,095 |
Rentals and fees | 0 | 0 | 0 | ||
Acima Holdings | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 2,328,089 | 810,151 | 749,260 | ||
Operating profit | 176,496 | 57,847 | 83,066 | ||
Depreciation, Amortization and Write-down of Intangibles | 2,122 | 2,066 | 1,533 | ||
Capital expenditures | 1,045 | 161 | 141 | ||
On rent | 676,279 | 299,660 | 676,279 | 299,660 | 268,845 |
Held for rent | 626 | 2,228 | 626 | 2,228 | 1,254 |
Assets | 1,476,752 | 389,650 | 1,476,752 | 389,650 | 357,859 |
Rentals and fees | 1,701,532 | 610,908 | 587,502 | ||
Acima [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 2,328,089 | 810,151 | 749,260 | ||
Gross profit | 728,852 | 321,110 | 333,798 | ||
Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating profit | 653,580 | 409,594 | 331,592 | ||
Depreciation, Amortization and Write-down of Intangibles | 21,314 | 22,431 | 22,801 | ||
Capital expenditures | 25,216 | 15,422 | 10,568 | ||
Assets | 2,560,719 | 1,445,909 | 2,560,719 | 1,445,909 | 1,355,812 |
Corporate, Non-Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating profit | (373,041) | (172,258) | (77,733) | ||
Depreciation, Amortization and Write-down of Intangibles | 33,516 | 34,227 | 38,303 | ||
Capital expenditures | 37,234 | 19,123 | 10,589 | ||
Assets | 432,608 | 305,071 | 432,608 | 305,071 | 226,986 |
United States [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 4,522,048 | 2,763,608 | 2,615,892 | ||
Assets | 2,951,658 | 1,708,702 | 2,951,658 | 1,708,702 | 1,547,895 |
Mexico [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenues | 61,403 | 50,583 | 53,960 | ||
Assets | 41,669 | 42,278 | 41,669 | 42,278 | 33,707 |
Canada [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Assets | $ 0 | $ 0 | $ 0 | $ 0 | $ 1,196 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Net earnings | $ 134,940 | $ 208,115 | $ 173,546 |
Weighted-average shares outstanding | 57,053 | 54,187 | 54,325 |
Effect of dilutive stock awards | 9,786 | 1,567 | 1,630 |
Weighted-average dilutive shares | 66,839 | 55,754 | 55,955 |
Basic earnings per common share | $ 2.37 | $ 3.84 | $ 3.19 |
Diluted earnings per common share | $ 2.02 | $ 3.73 | $ 3.10 |
Restricted share units [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted earnings per common share | 32 | 1 | 0 |
Performance share units [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted earnings per common share | 107 | 3 | 290 |
Stock options [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from diluted earnings per common share | 295 | 949 | 1,109 |