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EZCORP Announces 101% Earnings Growth for Second Quarter

Apr 20, 2004

EZCORP, Inc. (NASDAQ: EZPW) announced today results for its second fiscal quarter and six month period, which ended March 31, 2004.

For the quarter ended March 31, 2004, EZCORP's net income improved 101% to $3,007,000 (twenty-three cents per share) compared to $1,498,000 (twelve cents per share) for the prior year period. These earnings are above the Company's previously announced estimate of thirteen to sixteen cents for this period.

Total revenues for the second fiscal quarter increased 10% to $58,289,000 compared to $53,022,000 for the prior year second fiscal quarter. After higher levels of gross profit on merchandise and jewelry scrapping sales and higher levels of operating expense, operating income improved 90% to $4,468,000.

For the six months ended March 31, 2004, EZCORP generated net income of $5,997,000 (forty-six cents per share) compared to a net loss for the same six month period a year ago. Effective October 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, which deals with the accounting treatment of goodwill and other intangible assets. After a charge of $8,037,000 for the cumulative effect of adopting this new accounting principle, the Company reported a net loss for the six month period ended March 31, 2003 of $4,254,000 (thirty-four cents per share).

Commenting on these results, President and Chief Executive Officer, Joe Rotunda, stated, "It was an excellent quarter with each business element growing in volume and profitability. For the quarter, we had 5% same store sales growth with better margins, we more than doubled our payday loan balance from last year, and we increased our pawn loan balance 2% from a year ago. Our strong profit performance coupled with seasonal trends enabled us to generate significant cash flow and reduce debt during the quarter over $17 million to $15 million."

Rotunda continued, "In addition to our financial performance, we have made considerable progress with new store development. Through the first six months of the year, we have opened an additional 51 EZMoney Payday Loan stores, 46 of which adjoin an EZPAWN location. We now plan to open approximately 120 new EZMoney storefronts this fiscal year, up from our earlier guidance of 75 to 85."

Rotunda concluded, "Considering our performance through the first two quarters of fiscal 2004 and our plans for the balance of the year, we are raising our earnings guidance for the fiscal year to a range of $0.65 to $0.70 per share."

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, 2004, the Company operated 280 EZPAWN and 55 EZMONEY Payday Loan stores, 48 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, new store expansion and 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 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, 2004 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://www.firstcallevents.com/service/ajwz403904219gf12.html

  For additional information, contact Dan Tonissen at (512) 314-2289.


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

                                               Three Months Ended March 31,
                                                  2004              2003
   1 Revenues:
   2   Merchandise sales                         $33,188           $31,587
   3   Jewelry scrapping sales                     5,186             4,184
   4   Pawn service charges                       14,488            14,323
   5   Payday loan service charges                 5,072             2,675
   6   Other revenues                                355               253
   7     Total revenues                           58,289            53,022
   8 Cost of goods sold:
   9   Cost of merchandise sales                  18,858            19,243
  10   Cost of jewelry scrapping sales             3,659             3,429
  11     Total cost of goods sold                 22,517            22,672
  12 Net revenues                                 35,772            30,350
  13
  14 Operations expense                           23,061            21,414
  15 Administrative expense                        6,378             4,393
  16 Depreciation and amortization                 1,865             2,192
  17   Operating income                            4,468             2,351
  18
  19 Interest expense, net                           373               474
  20 Equity in net income of unconsolidated
      affiliate                                     (496)             (427)
  21 Income before income taxes                    4,591             2,304
  22 Income tax expense                            1,584               806
  23 Income before cumulative effect of
      a change in accounting principle             3,007             1,498
  24 Cumulative effect of adopting a
      new accounting principle, net of tax           ---               ---
  25 Net income                                   $3,007            $1,498
  26
  27 Income per share, assuming dilution:
  28   Income before cumulative effect of
        a change in accounting principle           $0.23             $0.12
  29   Cumulative effect of adopting a
        new accounting principle, net of tax         ---               ---
  30   Net income                                  $0.23             $0.12
  31
  32 Weighted average shares - assuming
      dilution                                    13,209            12,513
  33 Pawn store count - average for period           280               280
  34 Mono-line payday loan store count
      - average for period                            39               ---


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

                                                 Six Months Ended March 31,
                                                  2004              2003
   1 Revenues:
   2   Merchandise sales                         $64,250           $63,132
   3   Jewelry scrapping sales                     7,679             6,837
   4   Pawn service charges                       30,040            29,957
   5   Payday loan service charges                 9,933             5,752
   6   Other revenues                                701               543
   7     Total revenues                          112,603           106,221
   8 Cost of goods sold:
   9   Cost of merchandise sales                  36,441            37,937
  10   Cost of jewelry scrapping sales             5,349             6,055
  11     Total cost of goods sold                 41,790            43,992
  12 Net revenues                                 70,813            62,229
  13
  14 Operations expense                           45,677            42,859
  15 Administrative expense                       12,240             8,690
  16 Depreciation and amortization                 3,780             4,459
  17   Operating income                            9,116             6,221
  18
  19 Interest expense, net                           821             1,131
  20 Equity in net income of
      unconsolidated affiliate                      (861)             (730)
  21 Income before income taxes                    9,156             5,820
  22 Income tax expense                            3,159             2,037
  23 Income before cumulative effect of
      a change in accounting principle             5,997             3,783
  24 Cumulative effect of adopting a
      new accounting principle, net of tax           ---            (8,037)
  25 Net income (loss)                            $5,997           $(4,254)
  26
  27 Income (loss) per share, assuming dilution:
  28   Income before cumulative effect of
        a change in accounting principle           $0.46             $0.30
  29   Cumulative effect of adopting a
        new accounting principle, net of tax         ---             (0.64)
  30   Net income (loss)                           $0.46            $(0.34)
  31
  32 Weighted average shares - assuming
      dilution                                    13,101            12,438
  33 Pawn store count - average for period           280               280
  34 Mono-line payday loan store count
      - average for period                            26               ---


                               EZCORP, Inc.
          Highlights of Consolidated Balance Sheets (Unaudited)
          (in thousands, except per share data and store counts)

                                                      As of March 31,
                                                  2004              2003
   1  Assets:
   2    Current assets:
   3      Cash and cash equivalents                 $202            $3,386
   4      Pawn loans                              42,079            41,218
   5      Payday loans                             4,643             2,253
   6      Pawn service charges receivable, net     7,825             7,966
   7      Payday loan service charges
           receivable, net                           928               442
   8      Inventory, net                          29,492            29,535
   9      Deferred tax asset                       8,163             6,418
   10     Prepaid expenses and other assets        3,054             2,456
   11       Total current assets                  96,386            93,674
   12   Investment in unconsolidated
         affiliates                               15,417            15,124
   13   Property and equipment, net               24,642            28,659
   14   Deferred tax asset, non-current            4,391             1,948
   15   Other assets                               5,366             5,477
   16       Total assets                        $146,202          $144,882
   17 Liabilities and stockholders' equity:
   18   Current liabilities:
   19     Accounts payable and other
           accrued expenses                       11,668            10,030
   20     Customer layaway deposits                1,842             1,731
   21     Federal income taxes payable               771               443
   22       Total current liabilities             14,281            12,204
   23   Long-term debt, less current
         maturities                               15,000            28,000
   24   Deferred gains and other long-term
         liabilities                               4,139             4,019
   25       Total long-term liabilities           19,139            32,019
   26 Total stockholders' equity                 112,782           100,659
   27       Total liabilities and
             stockholders' equity               $146,202          $144,882
   28
   29 Pawn loan balance per ending pawn store       $150              $147
   30 Inventory per ending pawn store               $105              $105
   31 Book value per share                         $9.25             $8.26
   32 Tangible book value per share                $9.04             $8.03
   33 Pawn store count - end of period               280               280
   34 Mono-line payday loan store count
       - end of period                                55               ---
   35 Shares outstanding - end of period          12,198            12,188
Audio: http://www.firstcallevents.com/service/ajwz403904219gf12.html

SOURCE: EZCORP, Inc.

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

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

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