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EZCORP's Net Income Increases 31%

Nov 5, 2009

EZCORP, Inc. (NASDAQ: EZPW) announced today results for its fourth fiscal quarter and 2009 fiscal year ended September 30, 2009.

(Logo: http://www.newscom.com/cgi-bin/prnh/20090713/EZCORPLOGO)

EZCORP's net income for the quarter ended September 30, 2009 increased 31% to $20.9 million ($0.42 per share) compared to $16.0 million ($0.37 per share) for the prior year quarter. Total revenues for the quarter increased 34% to $164.8 million, primarily from a 43% increase in total sales (merchandise and jewelry scrapping) and a 39% increase in pawn service charges. Operating income improved 64% to $30.3 million (31% of net revenue) compared to $18.5 million (25% of net revenue) in the prior year quarter.

For the twelve months ended September 30, 2009, net income increased 31% to $68.5 million ($1.42 per share) compared to $52.4 million ($1.21 per share) for the prior year. Total revenues grew 31% to $597.5 million while operating income increased 38% to $101.5 million.

Acquisitions completed in November and December 2008 contributed net income of $4.2 million and $10.7 million in the current quarter and fiscal year. After the effect of shares issued, the acquisitions contributed approximately $0.04 and $0.11 per share in the current quarter and fiscal year.

Commenting on these results, President and Chief Executive Officer, Joe Rotunda, stated, "This is our 29th consecutive quarter and ninth consecutive year of earnings growth. We continue to deliver strong operating results with a strong balance sheet even in this tough economic environment. These results clearly demonstrate the value of our strategy to build earning assets through the pursuit of quality acquisitions, new store openings, and leveraging our store base through the introduction of new loan products."

Rotunda continued, "We expect fiscal 2010 earnings of $1.65 to $1.69 per share, with $0.41 to $0.43 per share for the December quarter, representing earnings growth of approximately 18% and 27%. This includes the expected accretion from our $49 million strategic investment in Cash Converters completed earlier today. In fiscal 2010, we plan to open 40 to 50 Empeno Facil pawn locations in Mexico, 35 to 45 Cash-Max payday loan locations in Canada, and 6 pawnshops in the United States."

EZCORP provides loans or credit services to customers who do not have cash resources or access to credit to meet their short-term cash needs. In its pawnshops, 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. The Company also offers a variety of short-term consumer loans, including payday loans, installment loans and auto title loans, or fee-based credit services to customers seeking loans from unaffiliated lenders.

At September 30, 2009, EZCORP operated a total of 910 locations in the U.S., Mexico and Canada consisting of 369 U.S. pawnshops, 62 Mexico pawnshops, 477 U.S. short-term loan stores and 2 Canada short-term loan stores. The Company also has strategic investments in Albemarle & Bond Holdings PLC, one of the U.K.'s largest pawnbroking businesses with 115 stores, and Cash Converters International Ltd., an operator and franchisor of approximately 500 locations worldwide.

This announcement contains certain forward-looking statements regarding the Company's expected operating and financial performance for future periods, including new store expansion, anticipated benefits of acquisitions and investments and expected future earnings. These statements are based on the Company's current expectations. Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of uncertainties and other factors, including changing market conditions in the overall economy and the industry, consumer demand for the Company's services and merchandise, actions of third parties who offer services and products in the Company's locations and changes in the regulatory environment. For a discussion of these and other factors affecting the Company's business and prospects, see 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 November 5, 2009 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=63071

  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 September
                                                             30,
                                                      ----------------
                                                         2009     2008
                                                         ----     ----
   1 Revenues:
   2     Merchandise sales                            $48,381  $34,926
   3     Jewelry scrapping sales                       40,313   27,162
   4     Pawn service charges                          37,392   26,860
   5     Signature loan fees                           34,935   33,561
   6     Auto title loan fees                           1,923      -
   7     Other                                          1,857      893
                                                        -----      ---
   8         Total revenues                           164,801  123,402
   9 Cost of goods sold:
  10     Cost of merchandise sales                     30,216   20,490
  11     Cost of jewelry scrapping sales               25,557   17,180
                                                       ------   ------
  12         Total cost of goods sold                  55,773   37,670
  13 Bad debt:
  14     Signature loan bad debt                       10,379   12,303
  15     Auto title loan bad debt                         227      -
                                                          ---      ---
  16         Total bad debt                            10,606   12,303
                                                       ------   ------
  17 Net revenue                                       98,422   73,429
  18
  19 Operations expense                                54,282   41,619
  20 Administrative expense                            10,605    9,533
  21 Depreciation and amortization                      3,275    3,327
  22 (Gain) / Loss on sale/disposal of assets             (57)     412
                                                          ---      ---
  23     Operating income                              30,317   18,538
  24
  25 Interest income                                      (24)    (118)
  26 Interest expense                                     361      192
  27 Equity in net income of unconsolidated affiliate  (1,853)  (1,180)
  28 Other                                                -         (3)
                                                          ---      ---
  29 Income before income taxes                        31,833   19,647
  30 Income tax expense                                10,894    3,616
                                                       ------    -----
  31 Net income                                       $20,939  $16,031
                                                      =======  =======
  32
                                                        -----    -----
  33 Net income per share, diluted                      $0.42    $0.37
                                                        =====    =====
  34
  35 Weighted average shares, diluted                  49,287   43,468



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

                                                          Year Ended
                                                         September 30,
                                                        --------------
                                                          2009      2008
                                                          ----      ----
   1 Revenues:
   2     Merchandise sales                            $204,674  $155,828
   3     Jewelry scrapping sales                       118,922    76,732
   4     Pawn service charges                          130,169    94,244
   5     Signature loan fees                           133,344   128,478
   6     Auto title loan fees                            3,589       -
   7     Other                                           6,758     2,121
                                                         -----     -----
   8         Total revenues                            597,456   457,403
   9 Cost of goods sold:
  10     Cost of merchandise sales                     126,564    92,612
  11     Cost of jewelry scrapping sales                77,025    46,790
                                                        ------    ------
  12         Total cost of goods sold                  203,589   139,402
  13 Bad debt:
  14     Signature loan bad debt                        33,553    37,150
  15     Auto title loan bad debt                          380       -
                                                           ---       ---
  16         Total bad debt                             33,933    37,150
                                                        ------    ------
  17 Net revenue                                       359,934   280,851
  18
  19 Operations expense                                206,237   158,927
  20 Administrative expense                             40,497    34,951
  21 Depreciation and amortization                      12,746    12,354
  22 (Gain) / Loss on sale/disposal of assets           (1,024)      939
                                                        ------       ---
  23     Operating income                              101,478    73,680
  24
  25 Interest income                                      (281)     (477)
  26 Interest expense                                    1,425       420
  27 Equity in net income of unconsolidated affiliate   (5,016)   (4,342)
  28 Other                                                  38         8
                                                           ---       ---
  29 Income before income taxes                        105,312    78,071
  30 Income tax expense                                 36,840    25,642
                                                        ------    ------
  31 Net income                                        $68,472   $52,429
                                                       =======   =======
  32
                                                         -----     -----
  33 Net income per share, diluted                       $1.42     $1.21
                                                         =====     =====
  34
  35 Weighted average shares, diluted                   48,076    43,327



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

                                                          As of September
                                                                 30,
                                                             2009     2008
                                                             ----     ----
   1 Assets:
   2   Current assets:
   3     Cash and cash equivalents                        $44,764  $27,444
   4     Pawn loans                                       101,684   75,936
   5     Signature loans, net                               8,357    7,124
   6     Pawn service charges receivable, net              18,187   12,755
   7     Auto title loans, net                              1,663        1
   8     Auto title loan finance charges receivable, net      529      -
   9     Signature loan fees receivable, net                5,599    5,406
  10     Inventory, net                                    64,001   43,209
  11     Deferred tax asset                                15,670   10,926
  12     Prepaid expenses and other assets                 16,927    9,115
                                                           ------    -----
  13          Total current assets                        277,381  191,916
  14
  15   Investment in unconsolidated affiliate              38,851   38,439
  16   Property and equipment, net                         51,154   40,079
  17   Deferred tax asset, non-current                      6,311    8,139
  18   Goodwill                                           100,719   24,376
  19   Other assets, net                                   18,101    5,771
                                                           ------    -----
  20          Total assets                               $492,517 $308,720
                                                         ======== ========
  21 Liabilities and stockholders' equity:
  22   Current liabilities:
  23     Current maturities of long-term debt             $10,000     $-
  24     Accounts payable and other accrued expenses       33,838   29,425
  25     Customer layaway deposits                          4,175    2,327
  26     Federal income taxes payable                         572      246
                                                              ---      ---
  27          Total current liabilities                    48,585   31,998
  28
  29   Long-term debt, less current maturities             25,000      -
  30   Deferred gains and other long-term liabilities       3,247    3,672
  31   Total stockholders' equity                         415,685  273,050
                                                          -------  -------
  32          Total liabilities and stockholders' equity $492,517 $308,720
                                                         ======== ========
  33
  34 Pawn loan balance per ending pawn store                 $236     $229
  35 Inventory per ending pawn store                         $148     $130
  36 Book value per share                                   $8.54    $6.58
  37 Tangible book value per share                          $6.14    $5.89
  38 Pawn store count - end of period                         431      332
  39 Signature loan store count - end of period               479      477
  40 Shares outstanding - end of period                    48,703   41,525



                                 EZCORP, Inc.
                  Operating Segment Results (Unaudited)
                     (in thousands, except store counts)

     Three months ended          U.S. Pawn  Empeno   EZMONEY
      September 30, 2009:        Operations  Facil  Operations Consolidated
                                 ----------  -----  ---------- ------------
   1  Revenues:
   2    Sales                       $85,554 $3,131         $9      $88,694
   3    Pawn service charges         35,838  1,554        -         37,392
   4    Signature loan fees             527    -       34,408       34,935
   5    Auto title loan fees            322    -        1,601        1,923
   6    Other                         1,780     77          -        1,857
                                      -----    ---        ---        -----
   7      Total revenues            124,021  4,762     36,018      164,801
   8
   9  Cost of goods sold             53,747  2,020          6       55,773
  10  Signature loan bad debt           247    -       10,132       10,379
  11  Auto title loan bad debt           52    -          175          227
                                        ---    ---        ---          ---
  12      Net revenues               69,975  2,742     25,705       98,422
  13
  14  Operations expense             37,761  1,809     14,712       54,282
                                     ------  -----     ------       ------
  15      Store operating income    $32,214   $933    $10,993      $44,140
                                    =======   ====    =======      =======
  16
  17  Pawn store count -
       end of period                    369     62        -            431
  18  Signature loan store
       count - end of period              6    -          473          479
  19
  20 Three months ended
      September 30, 2008:
  21  Revenues:
  22    Sales                       $60,001 $2,087       $-        $62,088
  23    Pawn service charges         25,343  1,517        -         26,860
  24    Signature loan fees             651    -       32,910       33,561
  25    Auto title loan fees            -      -          -            -
  26    Other                           893    -          -            893
                                        ---    ---        ---          ---
  27      Total revenues             86,888  3,604     32,910      123,402
  28
  29  Cost of goods sold             36,289  1,381        -         37,670
  30  Signature loan bad debt           367    -       11,936       12,303
  31  Auto title loan bad debt          -      -          -            -
                                        ---    ---        ---          ---
  32      Net revenues               50,232  2,223     20,974       73,429
  33
  34  Operations expense             25,753  1,328     14,538       41,619
                                     ------  -----     ------       ------
  35      Store operating income    $24,479   $895     $6,436      $31,810
                                    =======   ====     ======      =======
  36
  37  Pawn store count -
       end of period                    294     38        -            332
  38  Signature loan store
       count - end of period              6    -          471          477



                                 EZCORP, Inc.
                      Operating Segment Results (Unaudited)
                         (in thousands, except store counts)

     Year ended                   U.S. Pawn  Empeno   EZMONEY
      September 30, 2009:         Operations  Facil  Operations Consolidated
                                 ----------  -----  ---------- ------------
   1  Revenues:
   2    Sales                      $313,048 $10,539         $9     $323,596
   3    Pawn service charges        124,396   5,773        -        130,169
   4    Signature loan fees           2,293     -      131,051      133,344
   5    Auto title loan fees          1,313     -        2,276        3,589
   6    Other                         6,646     112        -          6,758
                                      -----     ---        ---        -----
   7      Total revenues            447,696  16,424    133,336      597,456
   8
   9  Cost of goods sold            196,914   6,669          6      203,589
  10  Signature loan bad debt           828     -       32,725       33,553
  11  Auto title loan bad debt          124     -          256          380
                                        ---     ---        ---          ---
  12      Net revenues              249,830   9,755    100,349      359,934
  13
  14  Operations expense            140,525   5,833     59,879      206,237
                                    -------   -----     ------      -------
  15      Store operating income   $109,305  $3,922    $40,470     $153,697
                                   ========  ======    =======     ========
  16
  17  Pawn store count -
       end of period                    369      62        -            431
  18  Signature loan store
       count - end of period              6     -          473          479
  19
  20 Year ended September 30,
      2008:
  21  Revenues:
  22    Sales                      $225,747  $6,813       $-       $232,560
  23    Pawn service charges         89,431   4,813        -         94,244
  24    Signature loan fees           2,782     -      125,696      128,478
  25    Auto title loan fees            -       -          -            -
  26    Other                         2,116       5        -          2,121
                                      -----     ---        ---        -----
  27      Total revenues            320,076  11,631    125,696      457,403
  28
  29  Cost of goods sold            135,142   4,260        -        139,402
  30  Signature loan bad debt         1,108     -       36,042       37,150
  31  Auto title loan bad debt          -       -          -            -
                                        ---     ---        ---          ---
  32      Net revenues              183,826   7,371     89,654      280,851
  33
  34  Operations expense             98,581   4,141     56,205      158,927
                                     ------   -----     ------      -------
  35      Store operating income    $85,245  $3,230    $33,449     $121,924
                                    =======  ======    =======     ========
  36
  37  Pawn store count -
       end of period                    294      38        -            332
  38  Signature loan store
       count - end of period              6     -          471          477

First Call Analyst:
FCMN Contact: connie_moore@ezcorp.com

Photo: http://www.newscom.com/cgi-bin/prnh/20090713/EZCORPLOGO
http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com

SOURCE: EZCORP, Inc.

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

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

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