Press Release Details

View all Investor News

EZCORP Announces Fiscal Year Results

Nov 12, 2002

EZCORP, Inc. (NASDAQ: EZPW) announced today results for its fiscal fourth quarter and 2002 fiscal year, which ended September 30, 2002.

For the quarter ended September 30, 2002, EZCORP is reporting net income of $0.3 million (two cents per share) compared to a net loss of $1.2 million (ten cents per share) for the same period a year ago. Operating income before depreciation and amortization for the quarter increased to $3.7 million compared to $3.2 million for the prior year period. Included in operating expense for the fiscal 2002 fourth quarter is approximately $0.4 million of incremental rent expense from sale-leasebacks. Excluding this incremental rent expense, operating income before depreciation and amortization would be $4.1 million, 28% above fiscal 2001. This increased rent expense is offset by combined reductions in interest and depreciation expense of approximately the same amounts.

For fiscal 2002, EZCORP is reporting net income of $2.2 million (eighteen cents per share) on total revenues of $196.9 million compared to a net loss of $0.6 million (five cents per share) on total revenues of $186.2 million for fiscal 2001. Operating income before depreciation and amortization increased to $18.1 million for the current period compared to $17.8 million for the prior year period. Included in operating expense for the twelve months is approximately $1.5 million of incremental rent expense from forty-two sale- leasebacks completed over the last two years. Excluding this incremental rent expense, operating income before depreciation and amortization would be $19.6 million, 10% above fiscal 2001.

Commenting on these results, President and Chief Executive Officer, Joe Rotunda, stated, "Our primary objectives this year were the following: first, to generate significant earnings and net cash flow; second, to reduce our leverage and complete a new credit facility with favorable terms; and finally, to develop and implement ancillary products and services for our customers, such as payday loans. I believe this year's earnings of $2.2 million versus a $0.6 million loss indicate we accomplished the first objective. As to the second objective, we ended the year with total debt of $42.2 million compared to $60.2 million a year ago. As we announced on October 30th, we have completed a re-syndication of our revolving credit facility. This new facility matures in March 2005, reduces our borrowing cost by approximately three percentage points, and will meet our capital needs through the maturity date."

Rotunda continued, "We made considerable progress this year developing and implementing new complementary products and services. One of these, payroll advances, has become a significant contributor to our earnings performance. At the end of the year we had approximately $2.3 million invested in short term loans or payroll advance loans compared to $1.3 million a year ago."

Rotunda concluded, "For fiscal 2003 we will continue to drive earnings growth through additional refinement of our core pawn business, growth in our payroll advance service, and the introduction of other new revenue streams that complement our business offering. We estimate earnings for fiscal 2003 to be between thirty-five and forty cents per share compared to eighteen cents per share for fiscal 2002. We expect the first and second fiscal quarters, October through March, to generate a significant portion of the fiscal year's earnings as seen historically. For our first fiscal quarter we estimate earnings to be between fourteen and seventeen cents compared to eleven cents for the fiscal 2002 first quarter."

EZCORP offers consumers convenient, non-recourse loans collateralized by tangible personal property, and short-term non-collateralized loans, often referred to as payday loans. A secondary, but related, business activity is the selling of previously owned merchandise consisting primarily of forfeited collateral. At September 30, 2002, the Company operated 280 stores in eleven states.

This announcement contains certain forward-looking statements regarding the Company's expected performance for future periods including, but not limited to, expected future earnings and the ability of the Company's credit facility to meet future capital needs. 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 periodically discussed in the Company's annual, quarterly and other reports filed with the Securities and Exchange Commission.

You are invited to listen to the conference call that will be broadcast over the Internet at http://www.firstcallevents.com/service/ajwz369571154gf12.html . The conference call can be replayed at the same address. For additional information, contact Dan Tonissen at (512) 314-2289.

                                EZCORP, Inc.
       Highlights of Consolidated Statement of Operations (Unaudited)
            (in thousands, except per share data and store count)

                                            Three Months Ended September 30,
                                                 2002              2001

   1  Total revenues                           $51,695           $47,010
   2  Cost of goods sold                        24,344            21,129
   3  Net revenues                              27,351            25,881
   4  Operating expenses                        23,612            22,704
   5   Operating income before depreciation
        and amortization                         3,739             3,177
   6  Depreciation and amortization              2,457             2,690
   7   Operating income                          1,282               487
   8  Interest expense, net                      1,059             1,697
   9  Equity in net income of
       unconsolidated affiliate                   (182)              (59)
   10 Loss on sale of assets                         7               251
   11 Restructuring expense                        ---               ---
   12 Income before income taxes                   398            (1,402)
   13 Income tax expense                           147              (190)
   14 Net income                                  $251           $(1,212)
   15
   16 Net income per share                       $0.02            $(0.10)
   17 Weighted average shares - fully diluted   12,335            12,128
   18 Store count - average for period             280               288


                                          Twelve Months Ended September 30,
                                                2002              2001

   1  Total revenues                          $196,898          $186,170
   2  Cost of goods sold                        84,936            79,089
   3  Net revenues                             111,962           107,081
   4  Operating expenses                        93,884            89,288
   5   Operating income before depreciation
        and amortization                        18,078            17,793
   6  Depreciation and amortization             10,087            10,808
   7   Operating income                          7,991             6,985
   8  Interest expense, net                      4,770             8,245
   9  Equity in net income of
       unconsolidated affiliate                   (604)             (267)
   10 Loss on sale of assets                       327               413
   11 Restructuring expense                        ---              (696)
   12 Income before income taxes                 3,498              (710)
   13 Income tax expense                         1,294              (142)
   14 Net income                                $2,204             $(568)
   15
   16 Net income per share                       $0.18            $(0.05)
   17 Weighted average shares - fully diluted   12,292            12,104
   18 Store count - average for period             281               292


                                EZCORP, Inc.
            Highlights of Consolidated Balance Sheets (Unaudited)
            (in thousands, except per share data and store count)
                                                   As of September 30,
                                                 2002              2001
   1  Assets:
   2   Current assets:
   3    Cash and cash equivalents               $1,492            $2,186
   4    Pawn loans                              49,248            47,144
   5    Short-term loans                         2,326             1,250
   6    Service charges receivable, net          9,304             8,841
   7    Inventory, net                          32,097            34,231
   8    Deferred tax asset                       6,418             7,413
   9    Federal income tax receivable              359               ---
   10   Prepaid expenses and other assets        1,898             2,180
   11     Total current assets                 103,142           103,245
   12  Investment in unconsolidated affiliates  14,406            13,812
   13  Property and equipment, net              32,190            44,965
   14  Other assets                             16,232            16,538
   15     Total assets                        $165,970          $178,560
   16 Liabilities and stockholders' equity:
   17  Current liabilities:
   18   Current maturities of long-term debt    $2,936           $15,947
   19   Accounts payable and other accrued
         expenses                               11,587             9,666
   20   Restructuring reserve                       34               217
   21   Customer layaway deposits                2,166             2,081
   22     Total current liabilities             16,723            27,911
   23  Long-term debt, less current maturities  39,309            44,245
   24  Deferred tax liability                    1,191             1,193
   25  Deferred gains and other long-term
        liabilities                              4,209             3,254
   26     Total long-term liabilities           44,709            48,692
   27 Total stockholders' equity               104,538           101,957
   28     Total liabilities and
           stockholders' equity               $165,970          $178,560
   29
   30 Loan balance per ending store               $184              $171
   31 Inventory per ending store                  $115              $121
   32 Book value per share                       $8.59             $8.41
   33 Tangible book value per share              $7.46             $7.22
   34 Store count - end of period                  280               283
   35 Shares outstanding - end of period        12,167            12,128


                            EZCORP, Inc. Valuation
                                                                   $ million
   1  Market capitalization (12.2M shares X closing price on
       11/11/02 of $2.80)                                             $34.1
   2  Total debt                                                       42.2
   3  Enterprise value                                                 76.3
   4  Less value of EZCORP's investment in Albemarle & Bond
       Holdings PLC
   5    (13.3M shares X closing price on 11/11/02 0.74 British Pounds
         X $1.59 per British Pounds)                                   15.6
   6
   7  Net enterprise value ("NEV")                                    $60.7
   8
   9  Last twelve months EBITDA                                       $18.7
   10
   11 NEV to EBITDA                                                     3.2


 Abemarle & Bond trades on the London Stock Exchange under the symbol ABM

Make Your Opinion Count - Click Here
http://tbutton.prnewswire.com/prn/11690X71863502

Audio: http://www.firstcallevents.com/service/ajwz369571154gf12.html

SOURCE: EZCORP, Inc.

CONTACT: Dan Tonissen of EZCORP, Inc., +1-512-314-2289

Web site: http://www.ezcorp.com/

Categories: Press Releases
View all Investor News