Press Release Details

View all Investor News

EZCORP Announces 95% Earnings Growth for Second Fiscal Quarter

Apr 25, 2006

EZCORP, Inc. (NASDAQ: EZPW) announced today results for its second fiscal quarter and six month period, which ended March 31, 2006.

For the quarter ended March 31, 2006, EZCORP's net income increased 95% to $7,727,000 ($0.56 per share) compared to $3,969,000 ($0.29 per share) for the quarter ended March 31, 2005. Total revenues for the second fiscal quarter increased 25% to $78,941,000 while operating income improved 97% to $11,540,000. Operating income margins for the quarter, measured as a percent of net revenues, improved approximately eight percentage points to 23%.

For the six months ended March 31, 2006, EZCORP's net income increased 62% to $14,483,000 ($1.06 per share) compared to $8,918,000 ($0.66 per share) for the same six month period a year ago. Total revenues grew 24% to $154,711,000 while operating income increased 62% to $21,855,000. Operating income margins for the six months, measured as a percent of net revenue, improved approximately five percentage points to 22%.

Commenting on these results, President and Chief Executive Officer, Joe Rotunda, stated, "Our results for the second fiscal 2006 quarter were driven by continued strong growth in our payday loan and credit service business and double digit growth in our pawn business. Payday loan and credit service contribution, or fee revenue less bad debt and direct transaction expense, improved 109% to $13.2 million. Payday loan and credit service revenues almost doubled to $15.6 million while bad debt and direct transaction expense measured as a percent of revenue improved four percentage points to 15%."

Rotunda continued, "Our pawn contribution or pawn net revenues improved 12% in the second quarter as a result of an 18% increase in sales gross profit and a 5% increase in pawn service charges. Higher levels of inventory available for sale during the quarter and higher gold values contributed to this strong pawn performance."

Rotunda concluded, "We expect our third fiscal 2006 quarter's earnings to be in the range of $0.20 to $0.23 per share compared to $0.16 for the fiscal 2005 third quarter. For our 2006 fiscal year, we are raising guidance to $1.60 to $1.65 per share compared to fiscal 2005's $1.09 per share. We expect year over year earnings growth to slow in the second half of our fiscal year compared to the first half primarily due to the earnings drag from the large number of stores anticipated to open in the next two quarters. Based on new EZMONEY locations in the pipeline, we expect to open 80 to 90 EZMONEY stores over the next two quarters for a total of approximately 115 new stores this fiscal year."

EZCORP is a lender and provider of credit services to individuals who do not have cash resources or access to credit to meet their short-term cash needs. In 281 EZPAWN locations, the Company offers non-recourse loans collateralized by tangible personal property, commonly known as pawn loans. At these locations, the Company also sells merchandise, primarily collateral forfeited from its pawn lending operations, to consumers looking for good value. In 263 EZMONEY locations and 83 EZPAWN locations, the Company offers short-term non-collateralized loans, often referred to as payday loans, or fee based credit services to customers seeking loans.

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 the 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 25, 2006 at 3:30pm Central Time. The conference call can be accessed over the Internet (or replayed at your convenience) at the following address. http://www.videonewswire.com/event.asp?id=33261

  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)

                                                Three Months Ended March 31,
                                                   2006              2005
   1  Revenues:
   2      Merchandise sales                      $39,036           $33,293
   3      Jewelry scrapping sales                  8,569             6,966
   4      Pawn service charges                    15,453            14,682
   5      Payday loan service charges              1,103             7,828
   6      Credit service fees                     14,451               ---
   7      Other                                      329               329
   8          Total revenues                      78,941            63,098
   9  Cost of goods sold:
   10     Cost of merchandise sales               22,775            18,961
   11     Cost of jewelry scrapping sales          5,562             4,940
   12         Total cost of goods sold            28,337            23,901
   13 Net revenues                                50,604            39,197
   14
   15 Operations expense                          27,908            23,988
   16 Payday loan bad debt and direct
       transaction expenses                          390             1,495
   17 Credit service bad debt and
       direct transaction expenses                 1,935               ---
   18 Administrative expense                       6,695             5,796
   19 Depreciation and amortization                2,136             2,071
   20     Operating income                        11,540             5,847
   21
   22 Interest expense, net                           41               275
   23 Equity in net income of
       unconsolidated affiliate                     (673)             (636)
   24 Loss on sale/disposal of assets                 23                 6
   25 Income before income taxes                  12,149             6,202
   26 Income tax expense                           4,422             2,233
   27 Net income                                  $7,727            $3,969
   28
   29 Net income per share, assuming dilution      $0.56             $0.29
   30
   31 Weighted average shares - assuming dilution 13,838            13,755



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

                                                 Six Months Ended March 31,
                                                   2006              2005
   1  Revenues:
   2      Merchandise sales                      $74,692           $65,311
   3      Jewelry scrapping sales                 15,266            11,272
   4      Pawn service charges                    31,967            31,351
   5      Payday loan service charges              2,255            16,118
   6      Credit service fees                     29,873               ---
   7      Other                                      658               674
   8          Total revenues                     154,711           124,726
   9  Cost of goods sold:
   10     Cost of merchandise sales               43,547            37,741
   11     Cost of jewelry scrapping sales         10,451             8,073
   12         Total cost of goods sold            53,998            45,814
   13 Net revenues                               100,713            78,912
   14
   15 Operations expense                          54,221            46,691
   16 Payday loan bad debt and direct
       transaction expenses                        1,122             3,104
   17 Credit service bad debt and
       direct transaction expenses                 5,739               ---
   18 Administrative expense                      13,517            11,663
   19 Depreciation and amortization                4,259             3,958
   20     Operating income                        21,855            13,496
   21
   22 Interest expense, net                          263               614
   23 Equity in net income of
       unconsolidated affiliate                   (1,188)           (1,096)
   24 Loss on sale/disposal of assets                  8                43
   25 Income before income taxes                  22,772            13,935
   26 Income tax expense                           8,289             5,017
   27 Net income                                 $14,483            $8,918
   28
   29 Net income per share, assuming dilution      $1.06             $0.66
   30
   31 Weighted average shares - assuming dilution 13,646            13,542



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

                                                       As of March 31,
                                                   2006              2005
   1  Assets:
   2    Current assets:
   3      Cash and cash equivalents              $26,041            $1,405
   4      Pawn loans                              39,044            40,081
   5      Payday loans, net                        1,507             7,711
   6      Pawn service charges receivable, net     6,598             7,720
   7      Payday loan service charges
           receivable, net                           250             1,573
   8      Credit service fees receivable, net      2,663               ---
   9      Inventory, net                          30,764            26,967
   10     Deferred tax asset                      10,629             9,711
   11     Prepaid expenses and other assets        4,014             5,418
   12       Total current assets                 121,510           100,586
   13   Investment in unconsolidated affiliate    17,614            17,094
   14   Property and equipment, net               27,124            26,132
   15   Deferred tax asset, non-current            4,012             4,946
   16   Other assets, net                          3,471             3,914
   17       Total assets                        $173,731          $152,672
   18 Liabilities and stockholders' equity:
   19   Current liabilities:
   20     Accounts payable and other accrued
           expenses                              $16,576           $13,359
   21     Customer layaway deposits                2,147             1,848
   22     Federal income taxes payable             1,035               271
   23       Total current liabilities             19,758            15,478
   24
   25   Long-term debt                               ---             6,825
   26   Deferred gains and other long-term
         liabilities                               3,430             3,778
   27     Total long-term liabilities              3,430            10,603
   28   Total stockholders' equity               150,543           126,591
   29     Total liabilities and stockholders'
           equity                               $173,731          $152,672
   30
   31 Pawn loan balance per ending pawn store       $139              $143
   32 Inventory per ending pawn store               $109               $96
   33 Book value per share                        $11.41            $10.19
   34 Tangible book value per share               $11.21             $9.99
   35 Pawn store count - end of period               281               280
   36 Mono-line payday loan store count
       - end of period                               263               192
   37 Shares outstanding - end of period          13,190            12,428

SOURCE: EZCORP, Inc.

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

Web site: http://www.ezcorp.com/
http://www.videonewswire.com/event.asp?id=33261

Categories: Press Releases
View all Investor News