CASH AMERICA
Cash America International, Inc.
Exhibit 99.1
ADDITIONAL INFORMATION: FOR IMMEDIATE RELEASE
Thomas A. Bessant, Jr.
(817) 335-1100
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CASH AMERICA ANNOUNCES FOURTH QUARTER NET INCOME INCREASE OF 56%
AND DECLARES DIVIDEND
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Fort Worth, Texas (January 22, 2004) - - Cash America International, Inc. (NYSE:
PWN) reported today that the results of the final quarter and the full year of
fiscal 2003 represented record levels for both earnings and revenue. Net income
for the fourth quarter of 2003 was $11,574,000 (40 cents per share) compared to
$7,442,000 (30 cents per share) in the fourth quarter of 2002, an increase of
56%. Earnings per share in the quarter reflected the impact of more shares
outstanding, due in part to an acquisition completed in the third quarter, and
increased 33% from the same period last year. The earnings per share for the
2003 fourth quarter finished at the top of the Company's previously announced
expectation for the period. Total revenue for the three-month period ended
December 31, 2003 was $130.6 million, up 23% from the prior year period of
$106.2 million.
The increase in total revenue in the fourth quarter of 2003 was generated from a
43% increase in the combined total of finance and service charges and cash
advance fees on the Company's loan portfolio as well as an 11% increase in
proceeds from the disposition of merchandise in the quarter. The rise in
year-over-year finance and service charges was due to higher average loan
balances outstanding during the quarter, while the increase in cash advance fees
was attributable to both higher cash advance balances and the inclusion of
Cashland, a company that provides short-term cash advances, that was acquired
during the third quarter of 2003.
Commenting on the results for the fourth quarter, Daniel R. Feehan, President
and Chief Executive Officer said, "We benefited from strong contributions from
each component of revenue in the final quarter of 2003 which led us to record
breaking results for the quarter and full year. Our operating performance
throughout 2003 came from both higher levels of earning assets and improved
margins due to careful execution of the business practices that lead to success
in our industry. Customer demand remains strong and we are committed to
providing our customers with the financial solutions to meet their needs."
For the twelve month period ended December 31, 2003, Cash America reported that
net income topped $30 million ($1.13 per share) for the first time in the
Company's history, up 56% from net income in 2002 of $19.3 million (78 cents per
share). Included in the results for the 2003 year was an after-tax gain on the
sale of a non-operating asset of $1.1 million. In 2002 the company had a gain of
$800 thousand from discontinued operations. Excluding these gains, Cash America
produced net income of $28.9 million ($1.08 per share) in fiscal 2003 compared
to $18.5 million (75 cents per share) of income from continuing operations in
2002. These results generated increases of 56% and 44% in earnings and earnings
per share, respectively, for the full year. Total revenue for 2003 was $437.7
million compared to $387.8 million in the prior year, up 13%.
Cash America will conduct a conference call to discuss its fourth quarter
earnings on Thursday, January 22, 2004, at 3:45 PM CST. A live web cast of the
call will be available on the home page of the Company's corporate web site
(www.cashamerica.com). To listen to the live call, please go to the web site at
least fifteen minutes early to register, download, and install any necessary
audio software.
Additionally, the Company announced that the Board of Directors, at its
regularly scheduled quarterly meeting, declared a $0.0175 (1.75 cents) per share
cash dividend on common stock outstanding. The dividend will be paid to
shareholders of record on February 4, 2004, and will be paid at the close of
business on February 18, 2004.
Forward-Looking Information
Cash America has completed 2003 with higher levels of aggregate earning assets
than the prior year, which management expects to provide continued earnings
momentum as it begins 2004. Management believes that the current economic
environment and the higher prevailing market value of gold will allow for the
growth in pawn loan balances to satisfy higher customer demand for pawn loans.
Management believes that the Company will also experience increases in its
short-term cash advance balances in response to consumer demand for this product
as well as from the addition of units opened during 2003 and expected to be
opened in 2004. During the first seven months of 2004, the Company will include
the results of Cashland for the first time. Based on these assumptions,
management has revised and increased its forecasted earnings per share for
fiscal 2004 to be between $1.26 and $1.36 per share. This compares to $1.08 per
share in earnings for fiscal 2003, excluding the impact of the sale of a
non-operating asset in the second quarter of 2003 of 5 cents per share. Results
for the calendar year 2004 will be concentrated in the seasonally high first and
fourth quarters of the year as a result of anticipated normal business cycles.
In the near term, management expects that earnings per share for the first
quarter of fiscal 2004 to be between 34 and 37 cents per share compared to 27
cents per share in the first quarter of 2003.
Cash America International, Inc. is a provider of specialty financial services
to individuals in the United States, United Kingdom and Sweden with 763 total
locations. Cash America is the largest provider of secured non-recourse loans to
individuals, commonly referred to as pawn loans, through 474 locations in 17
states and two foreign countries under the brand names Cash America Pawn in the
U.S., Harvey & Thompson in the U.K. and Svensk Pantbelaning in Sweden. The
Company also offers short-term cash advances in many of its U.S. locations
including 19 locations that offer only this service under the brand name Cash
America Payday Advance. In addition, the Company provides short-term cash
advances and check cashing through its 135 "Cashland" consumer finance centers,
and check cashing services through its 135 franchised and Company-owned "Mr.
Payroll" check cashing centers.
This release contains forward-looking statements about the business, financial
condition and prospects of Cash America International, Inc. and its subsidiaries
("the Company"). The actual results of the Company could differ materially from
those indicated by the forward-looking statements because of various risks and
uncertainties including, without limitation, changes in demand for the Company's
services, the actions of third parties who offer products and services at the
Company's locations, changes in competition, the ability of the Company to open
new operating units in accordance with its plans, economic conditions, real
estate market fluctuations, interest rate fluctuations, changes in the capital
markets, changes in tax and other laws and governmental rules and regulations
applicable to the Company's business, and other risks indicated in the Company's
filings with the Securities and Exchange Commission. These risks and
uncertainties are beyond the ability of the Company to control, and, in many
cases, the Company cannot predict all of the risks and uncertainties that could
cause its actual results to differ materially from those indicated by the
forward-looking statements. When used in this release, terms such as "believes",
"estimates", "plans", "expects", "anticipates" and similar expressions as they
relate to the Company or its management are intended to identify forward-looking
statements. The Company disclaims any intention or obligation to update or
revise any forward-looking statements to reflect events or circumstances
occurring after the date of this release.
* * *
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS
(in thousands, except per share data)
- --------------------------------------------------------------------------------
Three Months Ended Year Ended
December 31, December 31,
--------------------------- ---------------------------
2003 2002 2003 2002
------------- ------------ -------------- -----------
CONSOLIDATED OPERATIONS:
Total revenue............................................. $ 130,607 $ 106,180 $ 437,677 $ 387,843
Net revenue............................................... 84,119 63,091 277,664 227,132
Total operating expenses.................................. 63,574 49,066 223,365 189,092
- ---------------------------------------------------------------------------------------------------------------------------
INCOME FROM OPERATIONS.................................... $ 20,545 $ 14,025 $ 54,299 38,040
- ---------------------------------------------------------------------------------------------------------------------------
Income from continuing operations before income taxes..... 18,059 11,622 46,134 28,902
- ---------------------------------------------------------------------------------------------------------------------------
INCOME FROM CONTINUING OPERATIONS......................... 11,574 7,442 30,036 18,509
- ---------------------------------------------------------------------------------------------------------------------------
NET INCOME................................................ $ 11,574 $ 7,442 $ 30,036 $ 19,309
===========================================================================================================================
Net income per share:
Basic -
Income from continuing operations....................... $ 0.41 $ 0.31 $ 1.17 $ 0.76
Net income.............................................. $ 0.41 $ 0.31 $ 1.17 $ 0.79
Diluted -
Income from continuing operations....................... $ 0.40 $ 0.30 $ 1.13 $ 0.75
Net income.............................................. $ 0.40 $ 0.30 $ 1.13 $ 0.78
Weighted average shares - Basic.............................. 28,077 24,319 25,586 24,424
Weighted average shares - Diluted............................ 28,921 24,818 26,688 24,841
- ---------------------------------------------------------------------------------------------------------------------------
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS
(in thousands)
- --------------------------------------------------------------------------------
PAWN LENDING OPERATIONS FINANCIAL AND OPERATIONAL DATA:
As of December 31,
-----------------------------
2003 2002
--------- ------------
PAWN LOANS -
Domestic pawn loans outstanding................................................ $ 81,154 $ 78,615
Foreign pawn loans outstanding................................................. 60,717 48,773
--------- ---------
Total loans outstanding........................................................ $ 141,871 $ 127,388
========= =========
Total merchandise held for disposition, net.................................... $ 56,120 $ 54,444
========= ========
Amounts per owned lending location - Domestic only:
Loans outstanding........................................................ $ 204 $ 199
Merchandise held for disposition......................................... $ 124 $ 125
Consolidated:
Loans outstanding......................................................... $ 304 $ 280
Merchandise held for disposition.......................................... $ 120 $ 120
Number of pawnshop locations (not in thousands) -
Company owned............................................................. 467 455
Franchised................................................................ 7 13
--------- --------
474 468
========= ========
- --------------------------------------------------------------------------------
Three Months Ended Year Ended
December 31, December 31,
--------------------------- ------------------------------------
2003 2002 2003 2002
----------- -------------- ----------------- ----------------
SMALL CONSUMER CASH ADVANCES ("CASH ADVANCES") (A) (B) -
Total amount of cash advances written......................$ 51,888 41,599 $ 181,830 $ 123,705
Number of cash advances written (not in thousands)......... 171,503 144,073 612,215 435,160
Average cash advance amount written (not in thousands).....$ 303 289 $ 297 $ 284
Average number of locations offering cash advances
(not in thousands)..................................... 404 390 395 390
390 389
Number of pawn locations offering cash advances.............
Number of cash advance locations............................ 19 2
--------- ---------------
Total locations offering cash advances................... 409 391
========= ===============
As of December 31,
------------------------------------
2003 2002
-------- -----------
Combined cash advances outstanding.......................... $ 15,042 $ 12,139
======== ================
Company-owned cash advances (C):
Cash advances and fees outstanding.......................... $ 13,179 $ 3,958
======== ================
Less: Allowance for losses................................. (1,457) (1,748)
-------- ----------------
Net cash advances and fees outstanding .................. $ 11,632 $ 2,210
======== ================
- -------------------------------------------------------------------------------
CASH ADVANCE OPERATIONS FINANCIAL AND OPERATIONAL DATA (D):
- -------------------------------------------------------------------------------
Three Months Ended Year Ended
December 31, December 31, (D)
-------------------------------------------------------------------------
2003 2002 2003 2002
------------------- ------------------ --------------- --------------
Total amount of cash advances written..................$ 74,453 $ - $ 118,688 $ -
Number of cash advances written (not in thousands)..... 220,223 - 353,245 -
Average cash advance amount written (not in thousands).$ 338 $ - $ 336 $ -
Average number of locations offering cash advances
(not in thousands)................................. 134 - 130 -
Number of cash advance locations (not in thousands) -
At beginning of period............................... 129 - - -
Acquired............................................. - - 121 -
Start-ups............................................ 6 - 14 -
----------------- ----------------- ----------------- ----------------
End of period........................................ 135 - 135 -
================= ================= ================= ================
As of December 31,
-------------------------------------
2003 2002
------------- ---------------
Cash advances outstanding before allowance for losses... $ 18,615 $ -
Less: Allowance for losses............................. (1,901) -
------------- ---------------
Net cash advances and fees outstanding .............. $ 16,714 $ -
============= ===============
- -----------------------------------------
(A) Includes Cash America pawnshops and Cash America cash advance centers.
(B) Includes cash advances made by the Company and cash advances made by
third-party financial institutions.
(C) Amounts recorded in the Company's consolidated financial statements.
(D) Includes Cashland only, year end amounts represent the period from date
of acquisition, August 1, 2003 to December 31, 2003.
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
- --------------------------------------------------------------------------------
December 31,
-----------------------------
2003 2002
-------------- -------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents................................................... $ 14,547 $ 3,951
Pawn loans.................................................................. 141,871 127,388
Cash advances, net.......................................................... 28,346 2,210
Merchandise held for disposition, net....................................... 56,120 54,444
Finance and service charges receivable...................................... 23,568 21,096
Other receivables and prepaid expenses...................................... 10,628 8,671
Income taxes recoverable.................................................... 3,208 -
Deferred tax assets......................................................... 6,868 5,392
-------------- --------------
Total current assets...................................................... 285,156 223,152
Property and equipment, net................................................. 78,977 67,254
Goodwill.................................................................... 117,963 79,833
Other assets................................................................ 7,436 6,239
-------------- --------------
Total assets.............................................................. $ 489,532 $ 376,478
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses....................................... $ 39,167 $ 24,920
Customer deposits........................................................... 4,102 4,050
Income taxes currently payable.............................................. 1,386 2,086
Current portion of long-term debt........................................... 8,286 12,571
-------------- --------------
Total current liabilities................................................. 52,941 43,627
Deferred tax liabilities........................................................ 7,704 4,385
Long-term debt.................................................................. 152,394 136,131
Stockholders' equity:
Common stock, $.10 par value per share, 80,000,000 shares authorized........ 3,024 3,024
Additional paid-in capital.................................................. 141,867 127,819
Retained earnings........................................................... 141,642 113,278
Accumulated other comprehensive income (loss)............................... 7,995 (2,718)
Notes receivable secured by common stock.................................... (2,488) (5,864)
Treasury shares at cost..................................................... (15,547) (43,204)
-------------- --------------
Total stockholders' equity................................................ 276,493 192,335
-------------- --------------
Total liabilities and stockholders' equity................................ $ 489,532 $ 376,478
============== ==============
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
- --------------------------------------------------------------------------------
Three Months Ended Year Ended
December 31, December 31,
---------------------------- --------------------------
2003 2002 2003 2002
------------- ------------- ------------- -----------
(Unaudited)
REVENUE
Finance and service charges............................... $ 34,237 $ 31,442 $ 129,307 $ 118,248
Proceeds from disposition of merchandise.................. 74,544 67,386 254,604 245,943
Cash advance fees......................................... 19,582 6,250 46,955 19,084
Check cashing royalties and fees.......................... 2,244 1,102 6,811 4,568
------------- ------------- ------------- ------------
TOTAL REVENUE................................................ 130,607 106,180 437,677 387,843
COST OF REVENUE
Disposed merchandise...................................... 46,488 43,089 160,013 160,711
------------- ------------- ------------- ------------
NET REVENUE.................................................. 84,119 63,091 277,664 227,132
------------- ------------- ------------- ------------
EXPENSES
Operations................................................ 44,900 35,555 158,923 137,898
Cash advance loss provision............................... 3,655 2,137 10,756 6,676
Administration............................................ 10,366 7,566 37,545 29,559
Depreciation and amortization............................. 4,653 3,808 16,141 14,959
------------- ------------- ------------- ------------
TOTAL EXPENSES............................................... 63,574 49,066 223,365 189,092
------------- ------------- ------------- ------------
INCOME FROM OPERATIONS....................................... 20,545 14,025 54,299 38,040
Interest expense, net..................................... 2,486 2,396 9,178 8,961
Loss from derivative valuation fluctuations............... - 7 - 177
Gain from disposal of asset............................... - - (1,013) -
------------- ------------- ------------- ------------
Income from continuing operations before income taxes........ 18,059 11,622 46,134 28,902
Provision for income taxes................................ 6,485 4,180 16,098 10,393
------------- ------------- ------------- ------------
INCOME FROM CONTINUING OPERATIONS............................ 11,574 7,442 30,036 18,509
Gain from discontinued operations......................... - - - 800
------------- ------------- ------------- ------------
NET INCOME................................................... $ 11,574 $ 7,442 $ 30,036 $ 19,309
============= ============= ============= ============
Net income per share:
Basic -
Income from continuing operations....................... $ 0.41 $ 0.31 $ 1.17 $ 0.76
Gain from discontinued operations....................... $ - $ - $ - $ 0.03
Net income.............................................. $ 0.41 $ 0.31 $ 1.17 $ 0.79
Diluted -
Income from continuing operations....................... $ 0.40 $ 0.30 $ 1.13 $ 0.75
Gain from discontinued operations....................... $ - $ - $ - $ 0.03
Net income.............................................. $ 0.40 $ 0.30 $ 1.13 $ 0.78
Weighted average common shares outstanding:
Basic..................................................... 28,077 24,319 25,586 24,424
Diluted................................................... 28,921 24,818 26,688 24,841
Dividends declared per common share.......................... $ 0.0175 $ 0.0125 $ 0.0650 $ 0.0500
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
INCOME FROM OPERATIONS BY OPERATING SEGMENT
THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002
(in thousands)
- --------------------------------------------------------------------------------
(Unaudited)
-----------------------------------------------------------------------
Pawn Lending
--------------------------
United Cash Check
States Foreign Advances(a) Cashing(b) Consolidated
------------ ------------- ------------- ------------ ---------------
THREE MONTHS ENDED DECEMBER 31, 2003:
REVENUE
Finance and service charges............... $ 26,831 $ 7,406 $ - $ - $ 34,237
Proceeds from disposition of merchandise.. 67,870 6,674 - - 74,544
-
Cash advance fees......................... 7,980 - 11,602 - 19,582
Check cashing royalties and fees.......... - 555 856 833 2,244
------------ ------------ ------------ ------------ --------------
TOTAL REVENUE............................... 102,681 14,635 12,458 833 130,607
Cost of revenue - disposed merchandise...... 42,370 4,118 - - 46,488
------------ ------------ ------------ ------------ --------------
NET REVENUE................................. 60,311 10,517 12,458 833 84,119
------------ ------------ ------------ ------------ --------------
EXPENSES
Operations................................ 33,989 4,430 6,131 350 44,900
-
Cash advance loss provision............... 1,507 - 2,148 - 3,655
Administration............................ 7,223 1,558 1,406 179 10,366
Depreciation and amortization............. 2,894 820 785 154 4,653
------------ ------------ ------------ ------------ --------------
TOTAL EXPENSES.............................. 45,613 6,808 10,470 683 63,574
------------ ------------ ------------ ------------ --------------
INCOME FROM OPERATIONS...................... $ 14,698 $ 3,709 $ 1,988 $ 150 $ 20,545
============ ============ ============ ============ ==============
AS OF DECEMBER 31, 2003:
Total assets................................ $ 306,752 $ 112,024 $ 63,396 $ 7,360 $ 489,532
============ ============ ============ ============ ==============
THREE MONTHS ENDED DECEMBER 31, 2002:
REVENUE
Finance and service charges............... $ 25,288 $ 6,154 $ - $ - $ 31,442
Proceeds from disposition of merchandise.. 63,299 4,087 - - 67,386
-
Cash advance fees......................... 6,250 - - - 6,250
Check cashing royalties and fees.......... - 304 - 798 1,102
------------ ------------ ------------ ------------ --------------
TOTAL REVENUE............................... 94,837 10,545 - 798 106,180
Cost of revenue - disposed merchandise...... 40,597 2,492 - - 43,089
------------ ------------ ------------ ------------ --------------
NET REVENUE................................. 54,240 8,053 - 798 63,091
------------ ------------ ------------ ------------ --------------
EXPENSES
Operations................................ 31,952 3,291 - 312 35,555
Cash advance loss provision............... 2,137 - - - 2,137
Administration............................ 6,402 1,029 - 135 7,566
Depreciation and amortization............. 2,935 644 - 229 3,808
------------ ------------ ------------ ------------ --------------
TOTAL EXPENSES.............................. 43,426 4,964 - 676 49,066
------------ ------------ ------------ ------------ --------------
INCOME FROM OPERATIONS...................... $ 10,814 $ 3,089 $ - $ 122 $ 14,025
============ ============ ============ ============ ==============
AS OF DECEMBER 31, 2002:
Total assets................................ $ 279,208 $ 89,532 $ - $ 7,738 $ 376,478
============ ============ ============ ============ ==============
- ---------------------------------
(a) Cashland only.
(b) Mr. Payroll only.
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
INCOME FROM OPERATIONS BY OPERATING SEGMENT
YEAR ENDED DECEMBER 31, 2003 AND 2002
(in thousands)
- --------------------------------------------------------------------------------
(Unaudited)
-----------------------------------------------------------------------
Pawn Lending
--------------------------
United Cash Check
States Foreign Advances(a) Cashing(b) Consolidated
------------ ------------- ------------- ------------ ----------------
YEAR ENDED DECEMBER 31, 2003:
REVENUE
Finance and service charges............... $ 100,699 $ 28,608 $ - $ - $ 129,307
Proceeds from disposition of merchandise.. 236,032 18,572 - - 254,604
Cash advance fees......................... 28,294 - 18,661 - 46,955
Check cashing royalties and fees.......... - 1,862 1,381 3,568 6,811
------------ ------------ ----------- ------------ --------------
TOTAL REVENUE............................... 365,025 49,042 20,042 3,568 437,677
Cost of revenue - disposed merchandise...... 147,456 12,557 - - 160,013
------------ ------------ ---------- ------------ --------------
NET REVENUE................................. 217,569 36,485 20,042 3,568 277,664
------------ ------------ ---------- ------------ --------------
EXPENSES
Operations................................ 131,680 16,107 9,575 1,561 158,923
Cash advance loss provision............... 6,807 - 3,949 - 10,756
Administration............................ 29,660 5,026 2,115 744 37,545
Depreciation and amortization............. 11,492 2,872 1,244 533 16,141
------------ ------------ ---------- ------------ --------------
TOTAL EXPENSES.............................. 179,639 24,005 16,883 2,838 223,365
------------ ------------ ---------- ------------ --------------
INCOME FROM OPERATIONS...................... $ 37,930 $ 12,480 $ 3,159 $ 730 $ 54,299
============ ============ =========== ============ ==============
YEAR ENDED DECEMBER 31, 2002:
REVENUE
Finance and service charges............... $ 94,458 $ 23,790 $ - $ - $ 118,248
Proceeds from disposition of merchandise.. 233,396 12,547 - - 245,943
Cash advance fees......................... 19,084 - - - 19,084
Check cashing royalties and fees.......... - 1,005 - 3,563 4,568
------------ ------------ ----------- ------------ --------------
TOTAL REVENUE............................... 346,938 37,342 - 3,563 387,843
Cost of revenue - disposed merchandise...... 152,071 8,640 - - 160,711
------------ ------------ ----------- ------------ --------------
NET REVENUE................................. 194,867 28,702 - 3,563 227,132
------------ ------------ ----------- ------------ --------------
EXPENSES
Operations................................ 124,471 11,987 - 1,440 137,898
Cash advance loss provision............... 6,676 - - - 6,676
Administration............................ 24,874 4,075 - 610 29,559
Depreciation and amortization............. 11,794 2,472 - 693 14,959
------------ ------------ ----------- ------------ --------------
TOTAL EXPENSES.............................. 167,815 18,534 - 2,743 189,092
------------ ------------ ----------- ------------ --------------
INCOME FROM OPERATIONS...................... $ 27,052 $ 10,168 $ - $ 820 $ 38,040
============ ============ =========== ============ ==============
- --------------------------------
(a) Cashland only, for the period from date of acquisition, August 1, 2003 to December 31, 2003.
(b) Mr. Payroll only.