EXHIBIT 99
EZCORP ANNOUNCES 32% EARNINGS GROWTH
FOR SECOND QUARTER
AUSTIN, Texas (April 20, 2005) -- EZCORP, Inc. (Nasdaq/NM: EZPW) announced today
results for its second fiscal quarter and six month period, which ended March
31, 2005.
For the quarter ended March 31, 2005, EZCORP's net income improved 32% to
$3,969,000 (twenty-nine cents per share) compared to $3,007,000 (twenty-three
cents per share) for the prior year period. Total revenues for the second fiscal
quarter increased 8% to $63,098,000 compared to $58,289,000 for the prior year
second fiscal quarter. After higher cost of goods sold, due to higher levels of
sales, and higher operating expense, operating income improved 31% to
$5,847,000. Operating income margins for the quarter, measured as a percent of
net revenues, improved approximately three percentage points to 15%.
For the six months ended March 31, 2005, EZCORP generated net income of
$8,918,000 (sixty-six cents per share) compared to $5,997,000 (forty-six cents
per share) for the same six month period a year ago. Total revenues increased
11% to $124,726,000 while operating income increased 48% to $13,496,000.
Operating income margins for the six months, measured as a percent of net
revenue, improved approximately four percentage points to 17%.
Commenting on these results, President and Chief Executive Officer, Joe Rotunda,
stated, "Our results for the quarter continued our trend of strong
year-over-year earnings growth with net income up 32% over the prior year
quarter. Once again, payday loans were the strongest contributor to this growth
with payday loan service charges up 54%, while our payday loan bad debt and
direct transaction expenses increased only 16%. Modest increases in pawn service
charge revenue and gross profit on the sale of forfeited collateral also
contributed to our performance."
Rotunda continued, "While we believe our performance to date has been
outstanding, our results are overshadowed by the potential impact on our payday
loan business of the FDIC's payday loan guideline change. As we work to
understand the full effect of this change, we also are working on several fronts
to mitigate any adverse financial impact the changes may have. These fronts
include new loan products as well as programs to enhance our pawn business when
these changes are implemented. We also are cautiously optimistic about the
passing of Texas payday loan legislation."
Rotunda concluded, "Given the uncertainty surrounding the FDIC's changes and the
impact on our business, we are broadening our range of earnings guidance for the
year to $0.95 to $1.05. To the extent that the timing and circumstances
surrounding the implementation of the revised guideline are more or less
favorable, we would expect to be at the upper or lower end of this earnings
guidance range. Until the timing and circumstances of the guideline change are
resolved, the potential earnings impact cannot be fully determined."
EZCORP meets the short-term cash needs of the cash and credit constrained
consumer by offering convenient, non-recourse loans collateralized by tangible
personal property, commonly known as pawn loans, and short-term
non-collateralized loans, often referred to as payday loans. The Company also
sells merchandise, primarily collateral forfeited from its pawn lending
operations, to consumers looking for good value. As of March 31, 2005, the
Company operated 280 EZPAWN and 192 EZMONEY Payday Loan stores, 135 of which
adjoin an EZPAWN location.
This announcement contains certain forward-looking statements regarding the
Company's expected performance for future periods including, but not limited to,
expected future earnings. Actual results for these periods may materially differ
from these statements. Such forward-looking statements involve risks and
uncertainties such as changing market conditions in the overall economy and the
industry, consumer demand for the Company's services and merchandise, changes in
regulatory environment, and other factors
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periodically discussed in the Company's annual, quarterly and other reports
filed with the Securities and Exchange Commission.
You are invited to listen to a conference call discussing these results on April
20, 2005 at 3:30pm Central Time. The conference call can be accessed over the
Internet (or replay it at your convenience) at the following address.
HTTP://PHX.CORPORATE-IR.NET/PLAYERLINK.ZHTML?C=69434&S=WM&E=1050585
For additional information, contact Dan Tonissen at (512) 314-2289.
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EZCORP, INC.
HIGHLIGHTS OF CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except per share data)
- --------------------------------------------------------------------------------
THREE MONTHS ENDED MARCH 31,
---------------------------------
2005 2004
-------- --------
Revenues:
Merchandise sales $ 33,293 $ 33,188
Jewelry scrapping sales 6,966 5,186
Pawn service charges 14,682 14,488
Payday loan service charges 7,828 5,072
Other 329 355
-------- --------
Total revenues 63,098 58,289
Cost of goods sold:
Cost of merchandise sales 18,961 18,858
Cost of jewelry scrapping sales 4,940 3,659
-------- --------
Total cost of goods sold 23,901 22,517
-------- --------
Net revenues 39,197 35,772
Operations expense 23,988 21,775
Bad debt and other payday loan direct expenses 1,495 1,286
Administrative expense 5,796 6,378
Depreciation and amortization 2,071 1,865
-------- --------
Operating income 5,847 4,468
Interest expense, net 275 373
Equity in net income of unconsolidated affiliate (636) (496)
Loss on sale/disposal of assets 6 --
-------- --------
Income before income taxes 6,202 4,591
Income tax expense 2,233 1,584
-------- --------
Net income $ 3,969 $ 3,007
======== ========
-------- --------
Net income per share, assuming dilution $ 0.29 $ 0.23
======== ========
Weighted average shares - assuming dilution 13,755 13,209
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EZCORP, INC.
HIGHLIGHTS OF CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except per share data)
- --------------------------------------------------------------------------------
SIX MONTHS ENDED MARCH 31,
----------------------------------
2005 2004
--------- ---------
Revenues:
Merchandise sales $ 65,311 $ 64,250
Jewelry scrapping sales 11,272 7,679
Pawn service charges 31,351 30,040
Payday loan service charges 16,118 9,933
Other 674 701
--------- ---------
Total revenues 124,726 112,603
Cost of goods sold:
Cost of merchandise sales 37,741 36,441
Cost of jewelry scrapping sales 8,073 5,349
--------- ---------
Total cost of goods sold 45,814 41,790
--------- ---------
Net revenues 78,912 70,813
Operations expense 46,691 42,552
Bad debt and other payday loan direct expenses 3,104 3,125
Administrative expense 11,663 12,240
Depreciation and amortization 3,958 3,780
--------- ---------
Operating income 13,496 9,116
Interest expense, net 614 821
Equity in net income of unconsolidated affiliate (1,096) (861)
Loss on sale/disposal of assets 43 --
--------- ---------
Income before income taxes 13,935 9,156
Income tax expense 5,017 3,159
--------- ---------
Net income $ 8,918 $ 5,997
========= =========
--------- ---------
Net income per share, assuming dilution $ 0.66 $ 0.46
========= =========
Weighted average shares - assuming dilution 13,542 13,101
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EZCORP, INC.
HIGHLIGHTS OF CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands, except per share data and store counts)
- --------------------------------------------------------------------------------
AS OF MARCH 31,
2005 2004
-------- --------
Assets:
Current assets:
Cash and cash equivalents $ 1,405 $ 202
Pawn loans 40,081 42,079
Payday loans, net 7,711 4,643
Pawn service charges receivable, net 7,720 7,825
Payday loan service charges receivable, net 1,573 928
Inventory, net 26,967 29,492
Deferred tax asset 9,711 8,163
Prepaid expenses and other assets 5,418 3,054
-------- --------
Total current assets 100,586 96,386
Investment in unconsolidated affiliate 17,094 15,417
Property and equipment, net 26,132 24,642
Deferred tax asset, non-current 4,946 4,391
Other assets, net 3,914 5,366
-------- --------
Total assets $152,672 $146,202
======== ========
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable and other accrued expenses $ 13,359 $ 11,668
Customer layaway deposits 1,848 1,842
Federal income taxes payable 271 771
-------- --------
Total current liabilities 15,478 14,281
Long-term debt 6,825 15,000
Deferred gains and other long-term liabilities 3,778 4,139
-------- --------
Total long-term liabilities 10,603 19,139
Total stockholders' equity 126,591 112,782
-------- --------
Total liabilities and stockholders' equity $152,672 $146,202
======== ========
Pawn loan balance per ending pawn store $ 143 $ 150
Inventory per ending pawn store $ 96 $ 105
Book value per share $ 10.19 $ 9.25
Tangible book value per share $ 9.99 $ 9.04
Pawn store count - end of period 280 280
Mono-line payday loan store count - end of period 192 55
Shares outstanding - end of period 12,428 12,198
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