Exhibit 99.1
Cash America Begins 2006 with a 29%
Increase in First Quarter Net Income and Declares Dividend
FORT WORTH, Texas--(BUSINESS WIRE)--April 27, 2006--Cash America
International, Inc. (NYSE:CSH) announced today that net income for the
first quarter ended March 31, 2006 increased 29% to $15,388,000 (51
cents per share) compared to $11,902,000 (39 cents per share) for the
same period in 2005. Earnings per share, which rose 31% for the first
three months of 2006 compared to the same period in 2005, exceeded the
Company's initially published expectations in January of 2006 and were
slightly better than an updated release of expected results for the
first quarter on April 6, 2006.
Leading the growth in earnings was higher total revenue for the
first quarter, which increased 12% to $162.6 million from $145.0
million during the same period in 2005. Total revenue benefited from a
13% increase in revenue from combined cash advance fees and service
charges on pawn loans, which rose from $62.2 million in the 2005 first
quarter to $70.5 million in the first quarter of 2006. In addition,
the Company experienced strong retail sales activity, as merchandise
sold during the quarter was 11% above the prior year reaching $87.5
million.
Underlying the first quarter growth in total revenue was a 20%
increase in total cash advances written and a 6% increase in pawn
loans written during the first quarter of 2006 compared to the same
period in 2005. Higher volumes and lower loss rates enhanced the
overall performance and earnings from the cash advance portfolio. Also
contributing to the earnings growth in the first quarter was higher
gross profit margins on the 11% increase in merchandise sales during
the period, partially attributable to the increase in gold prices
during recent months.
Commenting on the results of the quarter, Daniel R. Feehan,
President and Chief Executive Officer of Cash America, said, "We began
the first quarter of 2006 with increased levels of earning assets and
an emphasis on execution to enhance the operating performance of our
cash advance portfolio. These opportunities and increased customer
traffic in our lending locations led to increases in revenue from all
business lines and created a very positive result for our shareholders
in the first quarter."
Cash America will host a conference call to discuss the first
quarter results on Thursday, April 27th at 3:45 p.m. CDT. A live web
cast of the call will be available on the Investor Relations section
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.
A replay will be available on the Company's web site for 90 days
following the conference call.
Additionally, the Company announced that the Board of Directors,
at its regularly scheduled quarterly meeting, declared a $0.025 (2.5
cents) per share cash dividend on common stock outstanding. The
dividend will be paid to shareholders of record on May 10, 2006 and
will be paid at the close of business on May 24, 2006.
Outlook for the Second Quarter of 2006 and Related Fiscal Year
Management believes that continued growth in earnings will be
largely a function of sustained increases in demand for its loan
products, which lead to higher asset balances and revenue. Other
elements that will affect the growth in revenue include the
development of new locations opened in the last 24 months and the
regulatory governance of its loan products. As it enters the second
quarter of 2006, management anticipates that demand for the Company's
products will remain strong. Based on the preceding factors management
expects that the second quarter income from continuing operations will
be between 26 cents and 28 cents per share in 2006 compared to 23
cents per share in 2005. Expectations for the remainder of fiscal 2006
will be impacted by earning asset levels in later periods based on
customer demand for credit products. At this time, management expects
that full year 2006 earnings per share from income from continuing
operations will range between $1.76 and $1.86 compared to $1.48 per
share in fiscal 2005.
Cash America International, Inc. is a provider of specialty
financial services to individuals in the United States with 894 total
locations. Cash America is the largest provider of secured
non-recourse loans to individuals, commonly referred to as pawn loans,
through 468 locations in 21 states under the brand names Cash America
Pawn and SuperPawn. The Company also offers short-term cash advances
in many of its locations including 286 locations that offer this
service under the brand names Cash America Payday Advance and
Cashland. In addition, check cashing services are provided through its
140 franchised and Company-owned "Mr. Payroll" check cashing centers.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
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, nor
can the Company predict, in many cases, 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
March 31,
-------------------
2006 2005
--------- ---------
Consolidated Operations:
Total revenue $162,618 $144,989
Net revenue $109,876 $97,034
Total operating expenses $83,577 $75,782
Income from operations $26,299 $21,252
Income before income taxes $24,306 $18,849
Net Income $15,388 $11,902
Earnings per share:
Basic $0.52 $0.41
Diluted $0.51 $0.39
Weighted average shares:
Basic 29,450 29,332
Diluted 30,385 30,396
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
December
March 31, 31,
-------------------
2006 2005 2005
--------- --------- ---------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $16,667 $11,874 $18,852
Pawn loans 103,031 97,307 115,280
Cash advances, net 29,704 30,318 40,704
Merchandise held for disposition, net 65,594 59,466 72,683
Finance and service charges receivable 19,140 17,789 22,048
Other receivables and prepaid expenses 15,533 11,941 13,406
Deferred tax assets 9,142 8,372 11,274
--------- --------- ---------
Total current assets 258,811 237,067 294,247
Property and equipment, net 97,173 88,906 94,856
Goodwill 175,596 164,374 174,987
Intangible assets, net 22,754 23,558 23,391
Other assets 11,234 11,212 11,167
--------- --------- ---------
Total assets $565,568 $525,117 $598,648
========= ========= =========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $34,246 $27,054 $37,217
Customer deposits 7,295 6,358 6,239
Income taxes currently payable 6,324 6,009 1,449
Current portion of long-term debt 16,786 16,786 16,786
--------- --------- ---------
Total current liabilities 64,651 56,207 61,691
Deferred tax liabilities 10,853 10,520 11,344
Other liabilities 1,606 1,404 1,689
Long-term debt 92,270 113,617 149,208
--------- --------- ---------
Total liabilities 169,380 181,748 223,932
--------- --------- ---------
Stockholders' equity:
Common stock 3,024 3,024 3,024
Additional paid-in capital 157,750 154,945 156,557
Retained earnings 244,630 199,050 229,975
Accumulated other comprehensive income
(loss) 34 -- (5)
Notes receivable secured by common
stock (382) (2,488) (2,488)
Treasury shares, at cost (8,868) (11,162) (12,347)
--------- --------- ---------
Total stockholders' equity 396,188 343,369 374,716
--------- --------- ---------
Total liabilities and stockholders'
equity $565,568 $525,117 $598,648
========= ========= =========
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
Three Months
Ended
March 31,
-----------------
2006 2005
-------- --------
(Unaudited)
Revenue
Finance and service charges $35,055 $33,919
Proceeds from disposition of merchandise 87,474 78,741
Cash advance fees 35,439 28,310
Check cashing royalties and fees 4,650 4,019
-------- --------
Total Revenue 162,618 144,989
Cost of Revenue
Disposed merchandise 52,742 47,955
-------- --------
Net Revenue 109,876 97,034
-------- --------
Expenses
Operations 59,273 53,673
Cash advance loss provision 4,437 5,634
Administration 13,514 10,909
Depreciation and amortization 6,353 5,566
-------- --------
Total Expenses 83,577 75,782
-------- --------
Income from Operations 26,299 21,252
Interest expense (2,436) (2,337)
Interest income 378 418
Foreign currency transaction gain (loss) 65 (484)
-------- --------
Income before Income Taxes 24,306 18,849
Provision for income taxes 8,918 6,947
-------- --------
Net Income $15,388 $11,902
======== ========
Net Income Per Share:
Basic $0.52 $0.41
Diluted $0.51 $0.39
Weighted average common shares outstanding:
Basic 29,450 29,332
Diluted 30,385 30,396
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
FINANCIAL AND OPERATING DATA
($ in thousands unless noted otherwise)
Three Months Ended
March 31,
-------------------
2006 2005
--------- ---------
PAWN LENDING OPERATIONS:
Pawn loans
Annualized yield on pawn loans 132.4% 135.2%
Total amount of pawn loans written and renewed $103,927 $97,830
Average pawn loan balance outstanding $107,354 $101,736
Average pawn loan balance per average location
in operation $235 $231
Ending pawn loan balance per location in
operation $225 $221
Average pawn loan amount at end of period (not
in thousands) $95 $88
Profit margin on disposition of merchandise as a
percentage of proceeds from disposition of
merchandise 39.7% 39.1%
Average annualized merchandise turnover 3.1x 3.0x
Average balance of merchandise held for
disposition per average location in operation $153 $145
Ending balance of merchandise held for
disposition per location in operation $143 $135
Pawnshop locations in operation --
Beginning of period, owned 456 441
Acquired 2 --
Start-ups 1 1
Combined or closed (1) (1)
--------- ---------
End of period, owned 458 441
Franchise locations at end of period 10 11
--------- ---------
Total pawnshop locations at end of period 468 452
========= =========
Average number of owned pawnshop locations 457 441
========= =========
Cash advances
Total amount of cash advances written (a) $59,013 $56,740
Number of cash advances written (not in
thousands) (a) 151,127 170,578
Average amount per cash advance (not in
thousands) (a) $390 $333
Combined cash advances outstanding (a) $13,724 $14,692
Cash advances outstanding per location at end of
period (a) $32 $34
Cash advances outstanding before allowance for
losses (b) $5,668 $9,059
Locations offering cash advances at end of
period 431 427
========= =========
Average number of locations offering cash
advances 433 427
========= =========
CASH ADVANCE OPERATIONS (c):
Total amount of cash advances written (a) $154,917 $122,085
Number of cash advances written (not in
thousands) (a) 412,003 350,550
Average amount per cash advance (not in
thousands) (a) $376 $348
Combined cash advances outstanding (a) $34,155 $28,146
Cash advances outstanding per location at end of
period (a) $119 $107
Cash advances outstanding before allowance for
losses (b) $27,577 $24,355
Cash advance locations in operation --
Beginning of period 286 253
Acquired -- --
Start-ups 3 13
Combined or closed (3) (2)
--------- ---------
End of period 286 264
========= =========
Average number of cash advance locations 286 258
========= =========
CHECK CASHING OPERATIONS (Mr. Payroll Corp.) (d)
Face amount of checks cashed $376,179 $337,028
Gross fees collected $5,672 $5,014
Fees as a percentage of checks cashed 1.5% 1.5%
Average check cashed (not in thousands) $476 $418
Centers in operation at end of period 140 135
========= =========
Average number of check cashing centers 139 135
========= =========
(a) Includes cash advances made by the Company and cash advances made
by third-party lenders offered at the Company's location
(b) Amounts recorded in the Company's consolidated financial
statements.
(c) Includes only cash advance locations.
(d) Includes franchised and company-owned locations.
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED CASH ADVANCES OUTSTANDING
(in thousands)
March 31,
-----------------
2006 2005
-------- --------
Originated by the Company
Active cash advances and fees receivable $24,677 $20,341
Cash advances and fees in collection 4,479 3,446
-------- --------
Total originated by the Company 29,156 23,787
-------- --------
Originated by third-party lenders
Active cash advances and fees receivable 15,440 15,149
Cash advances and fees in collection 3,283 3,902
-------- --------
Total originated by third-party lenders 18,723 19,051
-------- --------
Combined gross portfolio 47,879 42,838
Less: Elimination of cash advances owned by third-
party lenders 14,599 8,855
Less: Discount on cash advances assigned by third-
party banks 35 569
-------- --------
Company-owned cash advances and fees receivable,
gross 33,245 33,414
Less: Allowance for losses 3,541 3,096
-------- --------
Cash advances and fees receivable, net $29,704 $30,318
======== ========
ALLOWANCE FOR LOSSES ON CASH ADVANCES
($ in thousands)
Three Months
Ended
March 31,
-----------------
2006 2005
-------- --------
Company-owned cash advances
Balance at beginning of period $6,309 $4,358
Cash advance loss provision 4,706 5,681
Charge-offs (11,045) (9,841)
Recoveries 3,571 2,898
-------- --------
Balance at end of period $3,541 $3,096
======== ========
Accrual for third-party lender-owned cash advances
Balance at beginning of period $874 $342
Decrease in loss provision (269) (47)
-------- --------
Balance at end of period $605 $295
======== ========
Combined statistics
Combined cash advance loss provision $4,437 $5,634
Combined cash advance loss provision as a % of
combined cash advances written 2.1% 3.2%
Charge-offs (net of recoveries) as a % of combined
cash advances written 3.5% 3.9%
Combined allowance for losses and accrued third-party
lenders losses as a % of combined gross portfolio 8.7% 7.9%
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
INCOME FROM OPERATIONS BY OPERATING SEGMENT
THREE MONTHS ENDED MARCH 31, 2006 AND 2005
(in thousands)
Pawn Cash Check
Lending Advance Cashing Consolidated
--------- --------- ------- ------------
(Unaudited)
Three Months Ended March 31,
2006:
- -----------------------------
Revenue
Finance and service charges $35,055 $-- $-- $35,055
Proceeds from disposition of
merchandise 87,474 -- -- 87,474
Cash advance fees 9,648 25,791 -- 35,439
Check cashing royalties and
fees -- 3,499 1,151 4,650
--------- --------- ------- ------------
Total revenue 132,177 29,290 1,151 162,618
Cost of revenue -- disposed
merchandise 52,742 -- -- 52,742
--------- --------- ------- ------------
Net revenue 79,435 29,290 1,151 109,876
--------- --------- ------- ------------
Expenses
Operations 44,217 14,722 334 59,273
Cash advance loss provision 1,883 2,554 -- 4,437
Administration 10,610 2,652 252 13,514
Depreciation and
amortization 4,342 1,930 81 6,353
--------- --------- ------- ------------
Total expenses 61,052 21,858 667 83,577
--------- --------- ------- ------------
Income from operations $18,383 $7,432 $484 $26,299
========= ========= ======= ============
As of March 31, 2006:
- -----------------------------
Total assets $453,214 $105,264 $7,090 $565,568
========= ========= ======= ============
Three Months Ended March 31,
2005:
- -----------------------------
Revenue
Finance and service charges $33,919 $-- $-- $33,919
Proceeds from disposition of
merchandise 78,741 -- -- 78,741
Cash advance fees 8,980 19,330 -- 28,310
Check cashing royalties and
fees -- 2,888 1,131 4,019
--------- --------- ------- ------------
Total revenue 121,640 22,218 1,131 144,989
Cost of revenue -- disposed
merchandise 47,955 -- -- 47,955
--------- --------- ------- ------------
Net revenue 73,685 22,218 1,131 97,034
--------- --------- ------- ------------
Expenses
Operations 40,918 12,373 382 53,673
Cash advance loss provision 2,193 3,441 -- 5,634
Administration 8,362 2,312 235 10,909
Depreciation and
amortization 3,792 1,691 83 5,566
--------- --------- ------- ------------
Total expenses 55,265 19,817 700 75,782
--------- --------- ------- ------------
Income from operations $18,420 $2,401 $431 $21,252
========= ========= ======= ============
As of March 31, 2005:
- -----------------------------
Total assets $417,288 $100,728 $7,101 $525,117
========= ========= ======= ============
CONTACT: Cash America International, Inc., Fort Worth
Thomas A. Bessant, Jr., 817-335-1100