Attached files
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| 8-K - CASH AMERICA INTERNATIONAL, INC. 8-K - CASH AMERICA INTERNATIONAL INC | a50036647.htm |
Exhibit 99.1
Cash America Announces Third Quarter Net Income up 25% and Dividend Declared
FORT WORTH, Texas--(BUSINESS WIRE)--October 20, 2011--Cash America International, Inc. (NYSE: CSH) announced today that consolidated net income attributable to the Company for the third quarter of 2011 increased 25% to $34,777,000 ($1.08 per share) compared to the third quarter of 2010 which was $27,908,000 (90 cents per share). The earnings growth was achieved through a balanced contribution between growth in revenue from pawn related activities and consumer loan revenues as consolidated total revenue increased 21% during the third quarter of 2011 to $387.9 million, up from $319.4 million during the same period in 2010.
Consolidated net revenue also increased 21% to $235.4 million, with pawn loan fees and profit on the disposition of merchandise providing 56% of the increase while posting a 21% improvement year over year in pawn related net revenue to $130.0 million. Consumer loan fees, net of the loss provision expense, were up 22% to $102.4 million due to significant growth and a higher percentage of net revenue coming from consumer loans originated in foreign markets. Consolidated income from operations for the Company increased 25%, to $63.2 million in the third quarter of 2011 compared to $50.4 million for the same period in 2010.
The Company’s Retail Services segment posted higher revenue and earnings in the third quarter of 2011 primarily due to the performance of its domestic pawn lending business. Higher revenue from pawn loans led the Company’s U.S. based Retail Services segment to post a 20% increase in income from operations, which reached $42.5 million during the third quarter of 2011. Consolidated pawn loan balances were $244.4 million in the third quarter of 2011, up 25% from the same period in 2010. Net revenue from the Company’s E-Commerce segment increased 30% in the third quarter of 2011 compared to the same period in 2010 to $77.6 million mainly due to a 152% increase in foreign E-Commerce net revenue, which reached $35.7 million and amounted to 46% of the total E-Commerce net revenue for the period.
For the nine-month period ended September 30, 2011, Cash America reported a 21% increase in net income to $98,136,000 ($3.07 per share) compared to $80,830,000 ($2.56 per share) for the same period in 2010. Total revenue increased 17% to $1,077.4 million for the nine-month period ended September 30, 2011, up from $924.5 million for the same period in 2010.
Commenting on the results for the third quarter, Daniel R. Feehan, President and Chief Executive Officer of the Company said, “The third quarter results were achieved with solid contributions from each of our lending businesses by the continued growth in loan demand for both our pawn and consumer loan products.”
Cash America will conduct a conference call to discuss its third quarter earnings on Thursday, October 20, 2011 at 7:00 AM CDT. A live web cast of the call will be available on the Company’s corporate web site in the Investor Relations section (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 $0.035 (3.5 cents) per share cash dividend on common stock outstanding. The dividend will be paid at the close of business on November 16, 2011 to shareholders of record on November 2, 2011.
Expectations for the remainder of fiscal 2011 will be impacted by earning asset levels based on customer demand for credit products and by customer demand for the sale of merchandise in pawn lending locations during the seasonally important holiday selling season. The fourth quarter represents an important period of retail sales for the Company, and results will be affected by consumer sentiments during the period.
On September 15, 2011, the Company’s wholly-owned subsidiary, Enova International, Inc., which comprises the Company’s E-commerce segment, filed a registration statement on Form S-1 with the Securities and Exchange Commission in connection with a proposed initial public offering of Enova common stock by the Company and Enova. The registration statement has not yet become effective which restricts the Company from issuing earnings guidance for the remainder of 2011 or 2012 at this time and from commenting on, or updating, previously issued guidance.
About the Company
As of September 30, 2011, Cash America International, Inc. had 1,083 total locations offering specialty financial services to consumers, which include 782 lending locations (including nine unconsolidated franchised locations) operating in 23 states in the United States under the names “Cash America Pawn,” “SuperPawn,” “Maxit,” “Pawn X-Change,” “Cash America Payday Advance,” and “Cashland,” and 186 pawn lending locations, of which the Company is a majority owner, operating in 21 jurisdictions in central and southern Mexico under the name “Prenda Fácil.” The Company also operated 109 unconsolidated franchised and six Company-owned check cashing centers operating in 18 states in the United States under the name “Mr. Payroll” as of September 30, 2011. Additionally, as of September 30, 2011, the Company offered consumer loans over the Internet to customers in 32 states in the United States at http://www.cashnetusa.com, in the United Kingdom at http://www.quickquid.co.uk and http://www.poundstopocket.co.uk, in Australia at http://www.dollarsdirect.com.au, and in Canada at http://www.dollarsdirect.ca.
For additional information regarding the Company and the services it provides, visit the Company’s websites located at:
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http://www.cashamerica.com |
http://www.dollarsdirect.com.au |
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http://www.enovainternational.com |
http://www.dollarsdirect.ca |
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http://www.cashnetusa.com |
http://www.goldpromise.com |
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http://www.cashlandloans.com |
http://www.mrpayroll.com |
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http://www.quickquid.co.uk |
http://www.primaryinnovations.net |
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http://www.poundstopocket.co.uk |
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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 pawn, consumer loan, tax and other domestic and foreign laws and governmental rules and regulations applicable to the Company's business, changes in demand for the Company's services, acceptance by consumers, legislators or regulators of the negative characterization by the media and consumer activists with respect to certain of the Company’s loan products, the continued acceptance of the online distribution channel by the Company’s online loan customers, the actions of third parties who provide, acquire or offer products and services to, from or for the Company, fluctuations in the price of gold, changes in competition, the ability of the Company to open new locations in accordance with its plans, changes in economic conditions, real estate market fluctuations, interest rate fluctuations, changes in foreign currency exchange rates, changes in the capital markets, changes in the Company’s ability to satisfy its debt obligations or to refinance existing debt obligations or obtain new capital to finance growth, the ability to successfully integrate newly acquired businesses into the Company’s operations, the loss of services of any of the Company’s executive officers, a prolonged interruption in the Company’s operations of its facilities, systems and business functions, including its information technology and other business systems, the effect of any current or future litigation proceedings on the Company, the implementation of new, or changes in the interpretation of existing, accounting principles or financial reporting requirements, acts of God, war or terrorism, pandemics and other events, the effect of any of such changes on the Company’s business or the markets in which it operates, risks related to the Company’s previously-announced proposed initial public offering of common stock of Enova International, Inc. (“Enova”), and other risks and uncertainties 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,” “should,” “could,” “would,” “plans,” “expects,” “anticipates,” “may,” “forecasts,” “projects” and similar expressions and variations 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.
The registration statement on Form S-1 that was filed with the Securities and Exchange Commission by the Company’s wholly-owned subsidiary, Enova, has not yet become effective. The completion of the offering of common stock of Enova is subject to numerous conditions, including market conditions, and the Company can provide no assurance that it will be successfully completed. The securities offered under Enova’s registration statement may not be sold, nor may offers to buy be accepted prior to the time that the registration statement becomes effective. The information contained in this press release with respect to the offering shall not constitute an offer to sell or a solicitation of an offer to buy these securities.
| CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES | ||||||||||||
| HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS | ||||||||||||
| (in thousands, except per share data) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| September 30, | September 30, | |||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||
| Consolidated Operations: | ||||||||||||
| Total revenue | $ | 387,893 | $ | 319,360 | $ | 1,077,350 | $ | 924,503 | ||||
| Net revenue | 235,454 | 194,428 | 661,430 | 560,382 | ||||||||
| Total operating expenses | 172,289 | 144,069 | 485,213 | 414,446 | ||||||||
| Income from operations | $ | 63,165 | $ | 50,359 | $ | 176,217 | $ | 145,936 | ||||
| Income before income taxes | 55,503 | 44,886 | 156,838 | 129,585 | ||||||||
| Net Income | $ | 34,529 | $ | 27,478 | $ | 97,561 | $ | 80,440 | ||||
| Net loss attributable to the noncontrolling interest | 248 | 430 | $ | 575 | $ | 390 | ||||||
| Net Income Attributable to Cash America International, Inc. | $ | 34,777 | $ | 27,908 | $ | 98,136 | $ | 80,830 | ||||
| Earnings per share: | ||||||||||||
| Net Income attributable to Cash America International, Inc. common shareholders: | ||||||||||||
| Basic | $ | 1.18 | $ | 0.95 | $ | 3.31 | $ | 2.73 | ||||
| Diluted | $ | 1.08 | $ | 0.90 | $ | 3.07 | $ | 2.56 | ||||
| Weighted average shares: | ||||||||||||
| Basic | 29,535 | 29,462 | 29,626 | 29,601 | ||||||||
| Diluted | 32,248 | 31,038 | 31,969 | 31,598 | ||||||||
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS |
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| (in thousands, except per share data) | |||||||||||||
| (Unaudited) | |||||||||||||
| September 30, | December 31, | ||||||||||||
| 2011 | 2010 | 2010 | |||||||||||
| Assets | |||||||||||||
| Current assets: | |||||||||||||
| Cash and cash equivalents | $ | 54,364 | $ | 52,427 | $ | 38,324 | |||||||
| Pawn loans | 244,441 | 196,278 | 218,408 | ||||||||||
| Consumer loans, net | 191,642 | 129,480 | 139,377 | ||||||||||
| Merchandise held for disposition, net | 156,806 | 120,244 | 124,399 | ||||||||||
| Pawn loan fees and service charges receivable | 45,066 | 37,593 | 41,216 | ||||||||||
| Prepaid expenses and other assets | 41,654 | 48,066 | 32,490 | ||||||||||
| Deferred tax assets | 29,070 | 28,872 | 28,016 | ||||||||||
| Total current assets | 763,043 | 612,960 | 622,230 | ||||||||||
| Property and equipment, net | 236,325 | 203,409 | 222,320 | ||||||||||
| Goodwill | 538,169 | 515,345 | 543,324 | ||||||||||
| Intangible assets, net | 26,668 | 24,939 | 31,188 | ||||||||||
| Other assets | 13,948 | 6,897 | 8,124 | ||||||||||
| Total assets | $ | 1,578,153 | $ | 1,363,550 | $ | 1,427,186 | |||||||
| Liabilities and Equity | |||||||||||||
| Current liabilities: | |||||||||||||
| Accounts payable and accrued expenses | $ | 95,574 | $ | 94,543 | $ | 96,465 | |||||||
| Customer deposits | 10,588 | 9,619 | 9,146 | ||||||||||
| Income taxes currently payable | 10,520 | 8,746 | 888 | ||||||||||
| Current portion of long-term debt | 21,856 | 25,493 | 24,433 | ||||||||||
| Total current liabilities | 138,538 | 138,401 | 130,932 | ||||||||||
| Deferred tax liabilities | 88,980 | 50,156 | 56,792 | ||||||||||
| Noncurrent income tax payable | 2,343 | 2,275 | 2,408 | ||||||||||
| Other liabilities | 1,522 | 9,005 | 2,052 | ||||||||||
| Long-term debt | 470,124 | 405,233 | 432,271 | ||||||||||
| Total liabilities | $ | 701,507 | $ | 605,070 | $ | 624,455 | |||||||
| Equity: | |||||||||||||
| Cash America International, Inc. equity: | |||||||||||||
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Common stock, $0.10 par value per share, 80,000,000 shares authorized, 30,235,164 shares issued |
3,024 | 3,024 | 3,024 | ||||||||||
| Additional paid-in capital | 167,193 | 165,473 | 165,658 | ||||||||||
| Retained earnings | 739,256 | 610,545 | 644,208 | ||||||||||
| Accumulated other comprehensive (loss) income | (2,352 | ) | 6,433 | 4,797 | |||||||||
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Treasury shares, at cost (982,735 shares, 1,060,326 shares and 685,315 shares at September 30, 2011 and 2010, and at December 31, 2010, respectively) |
(35,752 | ) | (33,097 | ) | (21,283 | ) | |||||||
| Total Cash America International, Inc. shareholders' equity | 871,369 | 752,378 | 796,404 | ||||||||||
| Noncontrolling interest | 5,277 | 6,102 | 6,327 | ||||||||||
| Total equity | 876,646 | 758,480 | 802,731 | ||||||||||
| Total liabilities and equity | $ | 1,578,153 | $ | 1,363,550 | $ | 1,427,186 | |||||||
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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CONSOLIDATED STATEMENTS OF INCOME |
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(in thousands, except per share data) |
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(Unaudited) |
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| Three Months Ended | Nine Months Ended | ||||||||||||||||
| September 30, | September 30, | ||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||||||
| Revenue | |||||||||||||||||
| Pawn loan fees and service charges | $ | 77,053 | $ | 63,968 | $ | 212,290 | $ | 181,756 | |||||||||
| Proceeds from disposition of merchandise | 144,821 | 116,998 | 435,775 | 372,731 | |||||||||||||
| Consumer loan fees | 162,981 | 134,869 | 418,522 | 359,176 | |||||||||||||
| Other | 3,038 | 3,525 | 10,763 | 10,840 | |||||||||||||
| Total Revenue | 387,893 | 319,360 | 1,077,350 | 924,503 | |||||||||||||
| Cost of Revenue | |||||||||||||||||
| Disposed merchandise | 91,863 | 73,796 | 270,715 | 234,158 | |||||||||||||
| Consumer loan loss provision | 60,576 | 51,136 | 145,205 | 129,963 | |||||||||||||
| Total Cost of Revenue | 152,439 | 124,932 | 415,920 | 364,121 | |||||||||||||
| Net Revenue | 235,454 | 194,428 | 661,430 | 560,382 | |||||||||||||
| Expenses | |||||||||||||||||
| Operations | 124,522 | 105,809 | 352,999 | 304,259 | |||||||||||||
| Administration | 32,917 | 27,838 | 92,614 | 78,832 | |||||||||||||
| Depreciation and amortization | 14,850 | 10,422 | 39,600 | 31,355 | |||||||||||||
| Total Expenses | 172,289 | 144,069 | 485,213 | 414,446 | |||||||||||||
| Income from Operations | 63,165 | 50,359 | 176,217 | 145,936 | |||||||||||||
| Interest expense | (6,865 | ) | (5,647 | ) | (18,307 | ) | (16,510 | ) | |||||||||
| Interest income | 14 | 161 | 56 | 320 | |||||||||||||
| Foreign currency transaction (loss) gain | (777 | ) | 74 | (1,058 | ) | (100 | ) | ||||||||||
| Equity in loss of unconsolidated subsidiary | (34 | ) | (61 | ) | (70 | ) | (61 | ) | |||||||||
| Income before Income Taxes | 55,503 | 44,886 | 156,838 | 129,585 | |||||||||||||
| Provision for income taxes | 20,974 | 17,408 | 59,277 | 49,145 | |||||||||||||
| Net Income | 34,529 | 27,478 | 97,561 | 80,440 | |||||||||||||
| Net loss attributable to the noncontrolling interest | 248 | 430 | 575 | 390 | |||||||||||||
| Net Income Attributable to Cash America International, Inc. | $ | 34,777 | $ | 27,908 | $ | 98,136 | $ | 80,830 | |||||||||
| Earnings Per Share: | |||||||||||||||||
| Net Income attributable to Cash America International, Inc. common shareholders: | |||||||||||||||||
| Basic | $ | 1.18 | $ | 0.95 | $ | 3.31 | $ | 2.73 | |||||||||
| Diluted | $ | 1.08 | $ | 0.90 | $ | 3.07 | $ | 2.56 | |||||||||
| Weighted average common shares outstanding: | |||||||||||||||||
| Basic | 29,535 | 29,462 | 29,626 | 29,601 | |||||||||||||
| Diluted | 32,248 | 31,038 | 31,969 | 31,598 | |||||||||||||
| Dividends declared per common share | $ | 0.035 | $ | 0.035 | $ | 0.105 | $ | 0.105 | |||||||||
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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PAWN OPERATIONS - FINANCIAL AND OPERATING DATA |
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(in thousands, except per share data) |
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The following table outlines certain data related to the Company’s pawn loan activities as of and for the three and nine months ended September 30, 2011 and 2010. |
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| 2011 | 2010 | ||||||||||||||||||||||||||||
| Domestic | Foreign | Total | Domestic | Foreign | Total | ||||||||||||||||||||||||
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As of September 30, |
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| Ending pawn loan balances | $ | 225,921 | $ | 18,520 | $ | 244,441 | $ | 175,880 | $ | 20,398 | $ | 196,278 | |||||||||||||||||
| Ending merchandise balance, net | $ | 156,806 | $ | - | (a) | $ | 156,806 | $ | 120,244 | $ | - | (a) | $ | 120,244 | |||||||||||||||
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Three Months Ended September 30, |
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| Pawn loan fees and service charges | $ | 69,025 | $ | 8,028 | $ | 77,053 | $ | 56,638 | $ | 7,330 | $ | 63,968 | |||||||||||||||||
| Average pawn loan balance outstanding | $ | 218,607 | $ | 20,619 | $ | 239,226 | $ | 170,703 | $ | 21,013 | $ | 191,716 | |||||||||||||||||
| Amount of pawn loans written and renewed | $ | 240,062 | $ | 34,084 | $ | 274,146 | $ | 181,665 | $ | 20,418 | $ | 202,083 | |||||||||||||||||
| Annualized yield on pawn loans | 125.3 | % | 107.5 | % | (a) | 123.1 | % | 131.6 | % | 105.2 | % | (a) | 127.9 | % | |||||||||||||||
| Gross profit margin on disposition of merchandise | 36.6 | % | - | (a) | 36.6 | % | 36.9 | % | - | (a) | 36.9 | % | |||||||||||||||||
| Merchandise turnover | 2.6 | - | (a) | 2.6 | 2.6 | - | (a) | 2.6 | |||||||||||||||||||||
| 2011 | 2010 | ||||||||||||||||||||||||||||
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Nine Months Ended September 30, |
Domestic | Foreign | Total | Domestic | Foreign | Total | |||||||||||||||||||||||
| Pawn loan fees and service charges | $ | 190,409 | $ | 21,881 | $ | 212,290 | $ | 158,580 | $ | 23,176 | $ | 181,756 | |||||||||||||||||
| Average pawn loan balance outstanding | $ | 197,316 | $ | 21,645 | $ | 218,961 | $ | 157,343 | $ | 22,286 | $ | 179,629 | |||||||||||||||||
| Amount of pawn loans written and renewed | $ | 641,260 | $ | 80,483 | $ | 721,743 | $ | 491,602 | $ | 66,398 | $ | 558,000 | |||||||||||||||||
| Annualized yield on pawn loans | 129.0 | % | 101.5 | % | (a) | 114.6 | % | 134.8 | % | 112.8 | % | (a) | 117.3 | % | |||||||||||||||
| Gross profit margin on disposition of merchandise | 37.9 | % | - | (a) | 37.9 | % | 37.2 | % | - | (a) | 37.2 | % | |||||||||||||||||
| Merchandise turnover | 2.8 | - | (a) | 2.8 | 2.9 | - | (a) | 2.9 | |||||||||||||||||||||
| (a) | With respect to the Company’s foreign pawn operations, the annualized yield on pawn loans is calculated using the average pawn loan balance outstanding in the table above, plus the average collateral underlying unredeemed pawn loans of $9,002 and $6,618 for the three months ended September 30, 2011 and 2010, respectively, and $7,175 and $5,180 for the nine months ended September 30, 2011 and 2010, respectively. Collateral underlying unredeemed pawn loans will be sold to settle the obligations owed by the customer but are not owned by the Company; therefore, profit on the disposition of this collateral is recorded as pawn loan fees and service charges in the Company’s consolidated statements of operations. | ||||||||||||||||||||||||||||
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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MERCHANDISE DISPOSITION, GROSS PROFIT AND INVENTORY OPERATING DATA |
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(in thousands) |
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Profit from the disposition of merchandise represents the proceeds received from the disposition of merchandise in excess of the cost of disposed merchandise. Retail sales include the sale of jewelry and general merchandise direct to consumers through any of the Company’s retail services locations or the internet. Commercial sales include the sale of refined gold, platinum and diamonds to refiners, brokers or manufacturers. The following table summarizes the proceeds from the disposition of merchandise and the related profit for the three and nine months ended September 30, 2011 and 2010. |
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| Three Months Ended September 30, | ||||||||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||||||||
| Retail | Commercial | Total | Retail | Commercial | Total | |||||||||||||||||||
| Proceeds from disposition | $ | 76,101 | $ | 68,720 | $ | 144,821 | $ | 64,578 | $ | 52,420 | $ | 116,998 | ||||||||||||
| Gross profit on disposition | $ | 29,936 | $ | 23,022 | $ | 52,958 | $ | 26,203 | $ | 16,999 | $ | 43,202 | ||||||||||||
| Gross profit margin | 39.3 | % | 33.5 | % | 36.6 | % | 40.6 | % | 32.4 | % | 36.9 | % | ||||||||||||
| Percentage of total gross profit | 56.5 | % | 43.5 | % | 100.0 | % | 60.7 | % | 39.3 | % | 100.0 | % | ||||||||||||
| Nine Months Ended September 30, | ||||||||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||||||||
| Retail | Commercial | Total | Retail | Commercial | Total | |||||||||||||||||||
| Proceeds from disposition | $ | 246,028 | $ | 189,747 | $ | 435,775 | $ | 214,750 | $ | 157,981 | $ | 372,731 | ||||||||||||
| Gross profit on disposition | $ | 97,859 | $ | 67,201 | $ | 165,060 | $ | 86,106 | $ | 52,467 | $ | 138,573 | ||||||||||||
| Gross profit margin | 39.8 | % | 35.4 | % | 37.9 | % | 40.1 | % | 33.2 | % | 37.2 | % | ||||||||||||
| Percentage of total gross profit | 59.3 | % | 40.7 | % | 100.0 | % | 62.1 | % | 37.9 | % | 100.0 | % | ||||||||||||
The table below summarizes the age of merchandise held for disposition before valuation allowance of $0.7 million at September 30, 2011 and 2010 (dollars in thousands).
| 2011 | 2010 | |||||||||||||
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Balance at September 30, |
Amount | % | Amount | % | ||||||||||
| Jewelry - held for one year or less | $ | 99,383 | 63.1 | $ | 77,729 | 64.3 | ||||||||
| Other merchandise - held for one year or less | 52,687 | 33.4 | 37,215 | 30.7 | ||||||||||
| Total merchandise held for one year or less | 152,070 | 96.5 | 114,944 | 95.0 | ||||||||||
| Jewelry - held for more than one year | 2,091 | 1.3 | 3,033 | 2.5 | ||||||||||
| Other merchandise - held for more than one year | 3,345 | 2.2 | 2,967 | 2.5 | ||||||||||
| Total merchandise held for more than one year | 5,436 | 3.5 | 6,000 | 5.0 | ||||||||||
| Total merchandise held for disposition | $ | 157,506 | 100.0 | $ | 120,944 | 100.0 | ||||||||
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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CONSUMER LOAN FINANCIAL AND OPERATING DATA |
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(in thousands, except where otherwise noted) |
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The following table sets forth consumer loan fees by channel and segment, adjusted for the deduction of the loan loss provision for the three months ended September 30, 2011 and 2010 (dollars in thousands): |
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| Three Months Ended September 30, | ||||||||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||||||||
| Retail Services |
E-Commerce |
Total | Retail Services | E-Commerce | Total | |||||||||||||||||||
| Short-term loans | $ | 29,741 | $ | 117,084 | $ | 146,825 | $ | 29,129 | $ | 92,533 | $ | 121,662 | ||||||||||||
| Installment loans | 2,936 | 13,220 | 16,156 | 121 | 2,965 | 3,086 | ||||||||||||||||||
| MLOC | - | - | - | - | 10,121 | 10,121 | ||||||||||||||||||
| Consumer loan fees | $ | 32,677 | $ | 130,304 | $ | 162,981 | $ | 29,250 | $ | 105,619 | $ | 134,869 | ||||||||||||
| Consumer loan loss provision | 7,513 | 53,063 | 60,576 | 4,966 | 46,170 | 51,136 | ||||||||||||||||||
| Consumer loan fees, net of loan loss provision | $ | 25,164 | $ | 77,241 | $ | 102,405 | $ | 24,284 | $ | 59,449 | $ | 83,733 | ||||||||||||
| Year-over-year change - $ | $ | 880 | $ | 17,792 | $ | 18,672 | $ | (145 | ) | $ | 23,359 | $ | 23,214 | |||||||||||
| Year-over-year change - % | 3.6 | % | 29.9 | % | 22.3 | % | 0.6 | % | 64.7 | % | 38.4 | % | ||||||||||||
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Consumer loan loss provision as a % of consumer loan fees |
23.0 | % | 40.7 | % | 37.2 | % | 17.0 | % | 43.7 | % | 37.9 | % | ||||||||||||
| Nine Months Ended September 30, | ||||||||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||||||||
| Retail Services | E-Commerce | Total | Retail Services | E-Commerce | Total | |||||||||||||||||||
| Short-term loans | $ | 79,503 | $ | 304,153 | $ | 383,656 | $ | 83,450 | $ | 243,543 | $ | 326,993 | ||||||||||||
| Installment loans | 6,329 | 28,537 | 34,866 | 126 | 6,489 | 6,615 | ||||||||||||||||||
| MLOC | - | - | - | - | 25,568 | 25,568 | ||||||||||||||||||
| Consumer loan fees | $ | 85,832 | $ | 332,690 | $ | 418,522 | $ | 83,576 | $ | 275,600 | $ | 359,176 | ||||||||||||
| Consumer loan loss provision | 15,452 | 129,753 | 145,205 | 12,971 | 116,992 | 129,963 | ||||||||||||||||||
| Consumer loan fees, net of loan loss provision | $ | 70,380 | $ | 202,937 | $ | 273,317 | $ | 70,605 | $ | 158,608 | $ | 229,213 | ||||||||||||
| Year-over-year change - $ | $ | (225 | ) | $ | 44,329 | $ | 44,104 | $ | 576 | $ | 57,160 | $ | 57,736 | |||||||||||
| Year-over-year change - % | (0.3 | )% | 27.9 | % | 19.2 | % | 0.8 | % | 56.3 | % | 33.7 | % | ||||||||||||
|
Consumer loan loss provision as a % of consumer loan fees |
18.0 | % | 39.0 | % | 34.7 | % | 15.5 | % | 42.4 | % | 36.2 | % | ||||||||||||
|
In addition to reporting financial results in accordance with generally accepted accounting principles (“GAAP”) in the United States, the Company has provided combined consumer loans and combined consumer loans written, which are non-GAAP measures. Combined consumer loans and combined consumer loans written include (i) consumer loans written by the Company, which are GAAP measures, (ii) consumer loans written by third-party lenders through the CSO program, which are non-GAAP measures and (iii) the Company's participation interests in consumer loans written by a third-party lender’s micro line of credit (“MLOC”) product, which are GAAP measures. |
||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| September 30, | September 30, | |||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||
|
Combined consumer loan loss provision as a % of combined consumer loans written(a) |
7.4 | % | 6.2 | % | 6.7 | % | 5.9 | % | ||||
|
Charge-offs (net of recoveries) as a % of combined consumer loans written(a) |
6.1 | % | 5.2 | % | 6.3 | % | 5.1 | % | ||||
|
Combined consumer loan loss provision as a % of consumer loan fees(a) |
37.2 | % | 37.9 | % | 34.7 | % | 36.2 | % | ||||
|
(a) Non-GAAP measure. |
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|
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
||||||||||||||||||||||||
|
CONSUMER LOAN FINANCIAL AND OPERATING DATA |
||||||||||||||||||||||||
|
(in thousands, except where otherwise noted) |
||||||||||||||||||||||||
|
Management believes these measures are useful in evaluating the consumer loan portfolio on an aggregate basis, including its evaluation of the loss provision for the Company-owned portfolio and third-party lender-owned portfolios that the Company guarantees. The following table summarizes selected data related to the Company’s consumer loan activities as of September 30, 2011 and 2010 and for the three and nine months ended September 30, 2011 and 2010. |
||||||||||||||||||||||||
| As of September 30, | ||||||||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||||||||
| Company Owned(a) | Guaranteed by the Company(a) | Combined(b) | Company Owned(a) | Guaranteed by the Company(a) | Combined(b) | |||||||||||||||||||
| Ending consumer loan balances: | ||||||||||||||||||||||||
|
Retail Services |
||||||||||||||||||||||||
| Short-term loans | $ | 48,891 | $ | 8,644 | $ | 57,535 | $ | 45,700 | $ | 9,401 | $ | 55,101 | ||||||||||||
| Installment loans | 8,484 | 6,218 | 14,702 | 1,174 | 1,024 | 2,198 | ||||||||||||||||||
| Total Retail Services, gross | 57,375 | 14,862 | 72,237 | 46,874 | 10,425 | 57,299 | ||||||||||||||||||
|
E-Commerce |
||||||||||||||||||||||||
| Domestic | ||||||||||||||||||||||||
| Short-term loans | 51,829 | 33,514 | 85,343 | 52,707 | 36,673 | 89,380 | ||||||||||||||||||
| Installment loans | 19,856 | - | 19,856 | 5,856 | - | 5,856 | ||||||||||||||||||
| MLOC | - | - | - | 21,196 | - | 21,196 | ||||||||||||||||||
| Total Domestic, gross | 71,685 | 33,514 | 105,199 | 79,759 | 36,673 | 116,432 | ||||||||||||||||||
| Foreign | ||||||||||||||||||||||||
| Short-term loans | 86,987 | 2,842 | 89,829 | 48,313 | 1,318 | 49,631 | ||||||||||||||||||
| Installment loans | 22,930 | - | 22,930 | 120 | - | 120 | ||||||||||||||||||
| Total Foreign, gross | 109,917 | 2,842 | 112,759 | 48,433 | 1,318 | 49,751 | ||||||||||||||||||
| Total E-Commerce, gross | 181,602 | 36,356 | 217,958 | 128,192 | 37,991 | 166,183 | ||||||||||||||||||
| Total ending loan balance, gross | 238,977 | 51,218 | 290,195 | 175,066 | 48,416 | 223,482 | ||||||||||||||||||
| Less: Allowance and liabilities for losses | (47,335 | ) | (2,487 | ) | (49,822 | ) | (45,586 | ) | (2,790 | ) | (48,376 | ) | ||||||||||||
| Total ending loan balance, net | $ | 191,642 | $ | 48,731 | $ | 240,373 | $ | 129,480 | $ | 45,626 | $ | 175,106 | ||||||||||||
|
(a) GAAP measure. |
||||||||||||||||||||||||
|
(b) Except for allowance and liability for losses, amounts represent non-GAAP measures. |
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|
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
||||||||||||||||||
|
CONSUMER LOAN FINANCIAL AND OPERATING DATA |
||||||||||||||||||
|
(in thousands, except where otherwise noted) |
||||||||||||||||||
| Three Months Ended September 30, | ||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||
| Company Owned(a) | Guaranteed by the Company(a) | Combined(b) | Company Owned(a) | Guaranteed by the Company(a) | Combined(b) | |||||||||||||
| Amount of consumer loans written: | ||||||||||||||||||
|
Retail Services |
||||||||||||||||||
| Short-term loans | $ | 196,771 | $ | 45,915 | $ | 242,686 | $ | 181,384 | $ | 51,871 | $ | 233,255 | ||||||
| Installment loans | 1,601 | 5,126 | 6,727 | 267 | 1,576 | 1,843 | ||||||||||||
| Total Retail Services | 198,372 | 51,041 | 249,413 | 181,651 | 53,447 | 235,098 | ||||||||||||
|
E-Commerce |
||||||||||||||||||
| Domestic | ||||||||||||||||||
| Short-term loans | 109,909 | 180,890 | 290,799 | 118,646 | 229,212 | 347,858 | ||||||||||||
| Installment loans | 15,223 | - | 15,223 | 5,994 | - | 5,994 | ||||||||||||
| MLOC | - | - | - | 107,345 | - | 107,345 | ||||||||||||
| Total Domestic | 125,132 | 180,890 | 306,022 | 231,985 | 229,212 | 461,197 | ||||||||||||
| Foreign | ||||||||||||||||||
| Short-term loans | 231,310 | 15,410 | 246,720 | 119,543 | 6,608 | 126,151 | ||||||||||||
| Installment loans | 15,844 | - | 15,844 | 119 | - | 119 | ||||||||||||
| Total Foreign | 247,154 | 15,410 | 262,564 | 119,662 | 6,608 | 126,270 | ||||||||||||
| Total E-Commerce | 372,286 | 196,300 | 568,586 | 351,647 | 235,820 | 587,467 | ||||||||||||
| Total amount of consumer loans written | $ | 570,658 | $ | 247,341 | $ | 817,999 | $ | 533,298 | $ | 289,267 | $ | 822,565 | ||||||
| Number of consumer loans written: | ||||||||||||||||||
|
Retail Services |
||||||||||||||||||
| Short-term loans | 423,380 | 81,771 | 505,151 | 417,507 | 89,742 | 507,249 | ||||||||||||
| Installment loans | 1,554 | 977 | 2,531 | 759 | 293 | 1,052 | ||||||||||||
| Total Retail Services | 424,934 | 82,748 | 507,682 | 418,266 | 90,035 | 508,301 | ||||||||||||
|
E-Commerce |
||||||||||||||||||
| Domestic | ||||||||||||||||||
| Short-term loans | 342,634 | 258,705 | 601,339 | 336,578 | 337,272 | 673,850 | ||||||||||||
| Installment loans | 11,799 | - | 11,799 | 9,213 | - | 9,213 | ||||||||||||
| MLOC | - | - | - | 530,400 | - | 530,400 | ||||||||||||
| Total Domestic | 354,433 | 258,705 | 613,138 | 876,191 | 337,272 | 1,213,463 | ||||||||||||
| Foreign | ||||||||||||||||||
| Short-term loans | 433,216 | 22,251 | 455,467 | 238,190 | 13,809 | 251,999 | ||||||||||||
| Installment loans | 13,967 | - | 13,967 | 133 | - | 133 | ||||||||||||
| Total Foreign | 447,183 | 22,251 | 469,434 | 238,323 | 13,809 | 252,132 | ||||||||||||
| Total E-Commerce | 801,616 | 280,956 | 1,082,572 | 1,114,514 | 351,081 | 1,465,595 | ||||||||||||
| Total number of consumer loans written | 1,226,550 | 363,704 | 1,590,254 | 1,532,780 | 441,116 | 1,973,896 | ||||||||||||
|
(a) GAAP measure. |
||||||||||||||||||
| (b) Non-GAAP measure. | ||||||||||||||||||
|
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
||||||||||||||||||
|
CONSUMER LOAN FINANCIAL AND OPERATING DATA |
||||||||||||||||||
|
(in thousands, except where otherwise noted) |
||||||||||||||||||
| Nine Months Ended September 30, | ||||||||||||||||||
| 2011 | 2010 | |||||||||||||||||
| Company Owned(a) | Guaranteed by the Company(a) | Combined(b) | Company Owned(a) | Guaranteed by the Company(a) | Combined(b) | |||||||||||||
| Amount of consumer loans written: | ||||||||||||||||||
|
Retail Services |
||||||||||||||||||
| Short-term loans | $ | 534,182 | $ | 128,431 | $ | 662,613 | $ | 510,759 | $ | 148,088 | $ | 658,847 | ||||||
| Installment loans | 6,580 | 10,193 | 16,773 | 267 | 1,793 | 2,060 | ||||||||||||
| Total Retail Services | 540,762 | 138,624 | 679,386 | 511,026 | 149,881 | 660,907 | ||||||||||||
|
E-Commerce |
||||||||||||||||||
| Domestic | ||||||||||||||||||
| Short-term loans | 315,472 | 491,424 | 806,896 | 336,201 | 597,391 | 933,592 | ||||||||||||
| Installment loans | 28,262 | - | 28,262 | 13,187 | - | 13,187 | ||||||||||||
| MLOC | - | - | - | 274,234 | - | 274,234 | ||||||||||||
| Total Domestic | 343,734 | 491,424 | 835,158 | 623,622 | 597,391 | 1,221,013 | ||||||||||||
| Foreign | ||||||||||||||||||
| Short-term loans | 568,507 | 40,476 | 608,983 | 288,297 | 16,166 | 304,463 | ||||||||||||
| Installment loans | 36,797 | - | 36,797 | 119 | - | 119 | ||||||||||||
| Total Foreign | 605,304 | 40,476 | 645,780 | 288,416 | 16,166 | 304,582 | ||||||||||||
| Total E-Commerce | 949,038 | 531,900 | 1,480,938 | 912,038 | 613,557 | 1,525,595 | ||||||||||||
| Total amount of consumer loans written | $ | 1,489,800 | $ | 670,524 | $ | 2,160,324 | $ | 1,423,064 | $ | 763,438 | $ | 2,186,502 | ||||||
| Number of consumer loans written: | ||||||||||||||||||
|
Retail Services |
||||||||||||||||||
| Short-term loans | 1,155,859 | 226,068 | 1,381,927 | 1,172,012 | 257,384 | 1,429,396 | ||||||||||||
| Installment loans | 5,101 | 2,039 | 7,140 | 759 | 324 | 1,083 | ||||||||||||
| Total Retail Services | 1,160,960 | 228,107 | 1,389,067 | 1,172,771 | 257,708 | 1,430,479 | ||||||||||||
|
E-Commerce |
||||||||||||||||||
| Domestic | ||||||||||||||||||
| Short-term loans | 957,228 | 693,814 | 1,651,042 | 931,268 | 863,570 | 1,794,838 | ||||||||||||
| Installment loans | 24,630 | - | 24,630 | 21,655 | - | 21,655 | ||||||||||||
| MLOC | - | - | - | 1,378,959 | - | 1,378,959 | ||||||||||||
| Total Domestic | 981,858 | 693,814 | 1,675,672 | 2,331,882 | 863,570 | 3,195,452 | ||||||||||||
| Foreign | ||||||||||||||||||
| Short-term loans | 1,077,980 | 61,340 | 1,139,320 | 593,503 | 37,014 | 630,517 | ||||||||||||
| Installment loans | 32,185 | - | 32,185 | 133 | - | 133 | ||||||||||||
| Total Foreign | 1,110,165 | 61,340 | 1,171,505 | 593,636 | 37,014 | 630,650 | ||||||||||||
| Total E-Commerce | 2,092,023 | 755,154 | 2,847,177 | 2,925,518 | 900,584 | 3,826,102 | ||||||||||||
| Total number of consumer loans written | 3,252,983 | 983,261 | 4,236,244 | 4,098,289 | 1,158,292 | 5,256,581 | ||||||||||||
| (a) GAAP measure. | ||||||||||||||||||
| (b) Non-GAAP measure. | ||||||||||||||||||
|
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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|
INCOME FROM OPERATIONS BY OPERATING SEGMENT |
|||||||||||||||
|
(in thousands) |
|||||||||||||||
|
The Company allocates corporate administrative expenses to each operating segment based on personnel expenses at each segment. In the e-commerce segment, certain administrative expenses are allocated between the domestic and foreign components based on the amount of loans written for each geographic location. For comparison purposes, all prior periods in the tables below reflect the current classification of administrative and operating expenses. |
|||||||||||||||
| Retail Services | E-Commerce | ||||||||||||||
| Domestic | Foreign | Total | Domestic | Foreign | Total | Consolidated | |||||||||
|
Three Months Ended September 30, 2011 |
|||||||||||||||
| Revenue | |||||||||||||||
| Pawn loan fees and service charges | $69,025 | $8,028 | $77,053 | $- | $- | $- | $77,053 | ||||||||
| Proceeds from disposition of merchandise | 144,820 | - | 144,820 | 1 | - | 1 | 144,821 | ||||||||
| Consumer loan fees | 32,677 | - | 32,677 | 67,320 | 62,984 | 130,304 | 162,981 | ||||||||
| Other | 2,679 | 16 | 2,695 | 49 | 294 | 343 | 3,038 | ||||||||
| Total revenue | 249,201 | 8,044 | 257,245 | 67,370 | 63,278 | 130,648 | 387,893 | ||||||||
| Disposed merchandise | 91,863 | - | 91,863 | - | - | - | 91,863 | ||||||||
| Consumer loan loss provision | 7,513 | - | 7,513 | 25,472 | 27,591 | 53,063 | 60,576 | ||||||||
| Total cost of revenue | 99,376 | - | 99,376 | 25,472 | 27,591 | 53,063 | 152,439 | ||||||||
| Net revenue | 149,825 | 8,044 | 157,869 | 41,898 | 35,687 | 77,585 | 235,454 | ||||||||
| Expenses | |||||||||||||||
| Operations | 84,593 | 5,389 | 89,982 | 17,953 | 16,587 | 34,540 | 124,522 | ||||||||
| Administration | 12,204 | 2,749 | 14,953 | 9,809 | 8,155 | 17,964 | 32,917 | ||||||||
| Depreciation and amortization | 10,510 | 1,488 | 11,998 | 2,634 | 218 | 2,852 | 14,850 | ||||||||
| Total expenses | 107,307 | 9,626 | 116,933 | 30,396 | 24,960 | 55,356 | 172,289 | ||||||||
| Income (loss) from operations | $42,518 | $(1,582) | $40,936 | $11,502 | $10,727 | $22,229 | $63,165 | ||||||||
|
As of September 30, 2011 |
|||||||||||||||
| Total assets | $1,017,223 | $121,326 | $1,138,549 | $323,699 | $115,905 | $439,604 | $1,578,153 | ||||||||
| Goodwill | $327,887 | $210,282 | $538,169 | ||||||||||||
| Retail Services | E-Commerce | ||||||||||||||
| Domestic | Foreign | Total | Domestic | Foreign | Total | Consolidated | |||||||||
|
Three Months Ended September 30, 2010 |
|||||||||||||||
| Revenue | |||||||||||||||
| Pawn loan fees and service charges | $56,638 | $7,330 | $63,968 | $- | $- | $- | $63,968 | ||||||||
| Proceeds from disposition of merchandise | 116,998 | - | 116,998 | - | - | - | 116,998 | ||||||||
| Consumer loan fees | 29,250 | - | 29,250 | 77,720 | 27,899 | 105,619 | 134,869 | ||||||||
| Other | 3,184 | 65 | 3,249 | 276 | - | 276 | 3,525 | ||||||||
| Total revenue | 206,070 | 7,395 | 213,465 | 77,996 | 27,899 | 105,895 | 319,360 | ||||||||
| Disposed merchandise | 73,796 | - | 73,796 | - | - | - | 73,796 | ||||||||
| Consumer loan loss provision | 4,966 | - | 4,966 | 32,433 | 13,737 | 46,170 | 51,136 | ||||||||
| Total cost of revenue | 78,762 | - | 78,762 | 32,433 | 13,737 | 46,170 | 124,932 | ||||||||
| Net revenue | 127,308 | 7,395 | 134,703 | 45,563 | 14,162 | 59,725 | 194,428 | ||||||||
| Expenses | |||||||||||||||
| Operations | 73,515 | 4,078 | 77,593 | 19,707 | 8,509 | 28,216 | 105,809 | ||||||||
| Administration | 11,189 | 2,132 | 13,321 | 11,732 | 2,785 | 14,517 | 27,838 | ||||||||
| Depreciation and amortization | 7,041 | 1,307 | 8,348 | 2,004 | 70 | 2,074 | 10,422 | ||||||||
| Total expenses | 91,745 | 7,517 | 99,262 | 33,443 | 11,364 | 44,807 | 144,069 | ||||||||
| Income (loss) from operations | $35,563 | $(122) | $35,441 | $12,120 | $2,798 | $14,918 | $50,359 | ||||||||
|
As of September 30, 2010 |
|||||||||||||||
| Total assets | $844,756 | $121,271 | $966,027 | $343,870 | $53,653 | $397,523 | $1,363,550 | ||||||||
| Goodwill | $305,063 | $210,282 | $515,345 | ||||||||||||
|
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
||||||||||||||||||||||
|
INCOME FROM OPERATIONS BY OPERATING SEGMENT |
||||||||||||||||||||||
|
(in thousands) |
||||||||||||||||||||||
| Retail Services | E-Commerce | |||||||||||||||||||||
| Domestic | Foreign | Total | Domestic | Foreign | Total | Consolidated | ||||||||||||||||
|
Nine Months Ended September 30, 2011 |
||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||
| Pawn loan fees and service charges | $ | 190,409 | $ | 21,881 | $ | 212,290 | $ | - | $ | - | $ | - | $ | 212,290 | ||||||||
| Proceeds from disposition of merchandise | 435,745 | - | 435,745 | 30 | - | 30 | 435,775 | |||||||||||||||
| Consumer loan fees | 85,832 | - | 85,832 | 181,243 | 151,447 | 332,690 | 418,522 | |||||||||||||||
| Other | 9,248 | 292 | 9,540 | 392 | 831 | 1,223 | 10,763 | |||||||||||||||
| Total revenue | 721,234 | 22,173 | 743,407 | 181,665 | 152,278 | 333,943 | 1,077,350 | |||||||||||||||
| Disposed merchandise | 270,692 | - | 270,692 | 23 | - | 23 | 270,715 | |||||||||||||||
| Consumer loan loss provision | 15,452 | - | 15,452 | 59,134 | 70,619 | 129,753 | 145,205 | |||||||||||||||
| Total cost of revenue | 286,144 | - | 286,144 | 59,157 | 70,619 | 129,776 | 415,920 | |||||||||||||||
| Net revenue | 435,090 | 22,173 | 457,263 | 122,508 | 81,659 | 204,167 | 661,430 | |||||||||||||||
| Expenses | ||||||||||||||||||||||
| Operations | 247,337 | 17,632 | 264,969 | 45,164 | 42,866 | 88,030 | 352,999 | |||||||||||||||
| Administration | 38,198 | 7,703 | 45,901 | 27,490 | 19,223 | 46,713 | 92,614 | |||||||||||||||
| Depreciation and amortization | 26,567 | 4,459 | 31,026 | 7,956 | 618 | 8,574 | 39,600 | |||||||||||||||
| Total expenses | 312,102 | 29,794 | 341,896 | 80,610 | 62,707 | 143,317 | 485,213 | |||||||||||||||
| Income (loss) from operations | $ | 122,988 | $ | (7,621 | ) | $ | 115,367 | $ | 41,898 | $ | 18,952 | $ | 60,850 | $ | 176,217 | |||||||
| Retail Services | E-Commerce | |||||||||||||||||||||
| Domestic | Foreign | Total | Domestic | Foreign | Total | Consolidated | ||||||||||||||||
|
Nine Months Ended September 30, 2010 |
||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||
| Pawn loan fees and service charges | $ | 158,580 | $ | 23,176 | $ | 181,756 | $ | - | $ | - | $ | - | $ | 181,756 | ||||||||
| Proceeds from disposition of merchandise | 372,731 | - | 372,731 | - | - | - | 372,731 | |||||||||||||||
| Consumer loan fees | 83,576 | - | 83,576 | 207,631 | 67,969 | 275,600 | 359,176 | |||||||||||||||
| Other | 9,907 | 139 | 10,046 | 794 | - | 794 | 10,840 | |||||||||||||||
| Total revenue | 624,794 | 23,315 | 648,109 | 208,425 | 67,969 | 276,394 | 924,503 | |||||||||||||||
| Disposed merchandise | 234,158 | - | 234,158 | - | - | - | 234,158 | |||||||||||||||
| Consumer loan loss provision | 12,971 | - | 12,971 | 85,312 | 31,680 | 116,992 | 129,963 | |||||||||||||||
| Total cost of revenue | 247,129 | - | 247,129 | 85,312 | 31,680 | 116,992 | 364,121 | |||||||||||||||
| Net revenue | 377,665 | 23,315 | 400,980 | 123,113 | 36,289 | 159,402 | 560,382 | |||||||||||||||
| Expenses | ||||||||||||||||||||||
| Operations | 219,568 | 12,486 | 232,054 | 50,120 | 22,085 | 72,205 | 304,259 | |||||||||||||||
| Administration | 34,571 | 6,305 | 40,876 | 28,932 | 9,024 | 37,956 | 78,832 | |||||||||||||||
| Depreciation and amortization | 21,539 | 3,681 | 25,220 | 5,935 | 200 | 6,135 | 31,355 | |||||||||||||||
| Total expenses | 275,678 | 22,472 | 298,150 | 84,987 | 31,309 | 116,296 | 414,446 | |||||||||||||||
| Income from operations | $ | 101,987 | $ | 843 | $ | 102,830 | $ | 38,126 | $ | 4,980 | $ | 43,106 | $ | 145,936 | ||||||||
|
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
||||||||||||
|
LOCATION INFORMATION |
||||||||||||
|
Retail Services Segment |
||||||||||||
|
The following table sets forth the number of domestic and foreign locations in the Company’s retail services segment offering pawn lending, consumer lending, and other services as of September 30, 2011 and 2010. The Company’s domestic retail services locations operate under the names “Cash America Pawn,” “SuperPawn,” “Cash America Payday Advance,” “Cashland,” “Maxit,” “Pawn X-Change” and “Mr. Payroll.” (Maxit and Pawn X-Change were acquired in October 2010.) The Company’s foreign retail services locations (of which the Company is a majority owner) operate under the name “Prenda Fácil.” |
||||||||||||
| As of September 30, | ||||||||||||
| 2011 | 2010 | |||||||||||
| Domestic(a)(b) | Foreign(a) | Total | Domestic | Foreign | Total | |||||||
| Retail services locations offering: | ||||||||||||
| Both pawn and consumer lending | 571 | - | 571 | 569 | - | 569 | ||||||
| Pawn lending only | 125 | 186 | 311 | 77 | 202 | 279 | ||||||
| Consumer lending only | 86 | - | 86 | 89 | - | 89 | ||||||
| Other (c) | 115 | - | 115 | 125 | - | 125 | ||||||
| Total retail services | 897 | 186 | 1,083 | 860 | 202 | 1,062 | ||||||
| (a) Except as described in (c) below, includes locations that operate in 23 and 28 states in the United States and 21 states in Mexico, as of September 30, 2011 and 2010, respectively. | ||||||||||||
| (b) Includes eight and nine unconsolidated franchised locations operating under the name “Cash America Pawn” as of September 30, 2011 and 2010, respectively. | ||||||||||||
| (c) As of September 30, 2011 and 2010, includes six and five consolidated Company-owned check cashing locations, respectively, and 109 and 120 unconsolidated franchised check cashing locations, respectively. As of September 30, 2011, includes locations that operate in 18 states in the United States. | ||||||||||||
E-Commerce Segment
As of September 30, 2011, the Company’s e-commerce operating segment offers consumer loans to customers over the Internet:
- in 32 states in the United States at http://www.cashnetusa.com,
- in the United Kingdom at http://www.quickquid.co.uk and http://www.poundstopocket.co.uk,
- in Australia at http://www.dollarsdirect.com.au, and
- in Canada at http://www.dollarsdirect.ca.
The e-commerce segment also includes the Company’s MLOC services channel, which processed MLOC advances on behalf of a third-party lender and had a participation interest in MLOC receivables during most of 2010. In the past, the MLOC services channel generated its earnings through loan processing services the Company provided for a third-party lender, as well as from fees generated from participation interests in receivables the Company acquired. This program ended in October 2010 because the third-party lender discontinued offering MLOC advances. The Company intends to continue pursuing the development of new MLOC opportunities during 2011 and future periods.
Non-GAAP Disclosure
In addition to the financial information prepared in conformity with Generally Accepted Accounting Principles in the United States of America (“GAAP”), the Company provides historical non-GAAP financial information. Management uses the non-GAAP financial measures for internal managerial purposes and believes that presentation of non-GAAP financial information is meaningful and useful in understanding the activities and business metrics of the Company’s operations. Management believes that these non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s business that, when viewed with the Company’s GAAP results, provide a more complete understanding of factors and trends affecting the Company’s business.
Management provides non-GAAP financial information for informational purposes and to enhance understanding of the Company’s GAAP consolidated financial statements. Readers should consider the non-GAAP information in addition to, but not instead of, the Company’s financial statements prepared in accordance with GAAP. This non-GAAP financial information may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes.
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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ADJUSTED EARNINGS PER SHARE |
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Adjusted Earnings Per Share |
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In addition to reporting financial results in accordance with GAAP, the Company has provided adjusted earnings and adjusted earnings per share, which are non-GAAP measures. Management believes that the presentation of these measures provides investors with greater transparency and facilitates comparison of operating results across a broad spectrum of companies with varying capital structures, compensation strategies, derivative instruments and amortization methods, which provides a more complete understanding of the Company’s financial performance, competitive position and prospects for the future. Management also believes that investors regularly rely on non-GAAP financial measures, such as adjusted earnings and adjusted earnings per share, to assess operating performance and that such measures may highlight trends in the Company’s business that may not otherwise be apparent when relying on financial measures calculated in accordance with GAAP. The following table provides reconciliation between net income attributable to the Company and diluted earnings per share calculated in accordance with GAAP to adjusted earnings and adjusted earnings per share, respectively (dollars in thousands, except per share data): |
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| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||||||||||||||
| $ |
Per
Share |
$ |
Per
Share |
$ |
Per
Share |
$ |
Per
Share |
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Net income attributable to Cash America International, Inc. |
$ | 34,777 | $ | 1.08 | $ | 27,908 | $ | 0.90 | $ | 98,136 | $ | 3.07 | $ | 80,830 | $ | 2.56 | |||||||||
| Adjustments: | |||||||||||||||||||||||||
| Intangible asset amortization, net of tax | 939 | 0.03 | 643 | 0.02 | 3,024 | 0.09 | 2,060 | 0.07 | |||||||||||||||||
| Non-cash equity-based compensation, net of tax | 842 | 0.03 | 594 | 0.02 | 2,448 | 0.08 | 1,774 | 0.06 | |||||||||||||||||
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Convertible debt non-cash interest and issuance cost amortization, net of tax |
559 | 0.02 | 515 | 0.01 | 1,650 | 0.05 | 1,543 | 0.04 | |||||||||||||||||
| Foreign exchange loss (gain), net of tax | 483 | 0.01 | (45 | ) | - | 658 | 0.02 | 62 | - | ||||||||||||||||
| Adjusted earnings | $ | 37,600 | $ | 1.17 | $ | 29,615 | $ | 0.95 | $ | 105,916 | $ | 3.31 | $ | 86,269 | $ | 2.73 | |||||||||
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES |
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ADJUSTED EBITDA |
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Adjusted EBITDA |
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The table below shows adjusted EBITDA, a non-GAAP measure that is defined as earnings before depreciation, amortization, interest, foreign currency transaction gains or losses, equity in earnings or loss of unconsolidated subsidiary, taxes and net income or loss attributable to the noncontrolling interest. Management believes adjusted EBITDA is used by investors to analyze operating performance and evaluate the Company’s ability to incur and service debt and its capacity for making capital expenditures. In addition, adjusted EBITDA is also useful to investors to help assess the Company’s liquidity and estimated enterprise value. The computation of adjusted EBITDA as presented below may differ from the computation of similarly-titled measures provided by other companies (dollars in thousands): |
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| Trailing 12 Months Ended | ||||||||
| September 30, | ||||||||
| 2011 | 2010 | |||||||
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Net Income attributable to Cash America
International Inc. |
$ | 132,841 | $ | 114,513 | ||||
| Adjustments: | ||||||||
| Depreciation and amortization expenses | 52,172 | 41,991 | ||||||
| Interest expense, net | 24,078 | 21,403 | ||||||
| Foreign currency transaction loss | 1,421 | 239 | ||||||
| Equity in loss of unconsolidated subsidiary | 145 | 61 | ||||||
| Provision for income taxes | 79,401 | 68,193 | ||||||
| Net (loss) income attributable to the noncontrolling interest | (479 | ) | 71 | |||||
| Adjusted EBITDA | $ | 289,579 | $ | 246,471 | ||||
| Adjusted EBITDA margin calculated as follows: | ||||||||
| Total revenue | $ | 1,446,181 | $ | 1,248,200 | ||||
| Adjusted EBITDA | 289,579 | 246,471 | ||||||
| Adjusted EBITDA as a percentage of total revenue | 20.0 | % | 19.7 | % | ||||
CONTACT:
Cash America International, Inc.
Thomas A. Bessant, Jr.,
817-335-1100