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EZCORP Reports 73% Earnings Growth and Increases Annual Guidance

Jan 21, 2010

EZCORP, Inc. (NASDAQ: EZPW) announced today results for its first fiscal quarter ended December 31, 2009.

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

EZCORP's net income for the quarter ended December 31, 2009 increased 73% to $25.7 million ($0.52 per share) compared to $14.8 million ($0.33 per share) for the quarter ended December 31, 2008. Total revenues for the quarter increased 44% over the prior year period to $184.8 million.

Consolidated operating income improved 77% to $38.9 million (34% of net revenues) from $22.0 million (28% of net revenues) in the prior year quarter. The Company's U.S. pawn operations contributed $14.5 million of the improvement and the EZMONEY operations contributed $5.4 million of the increase. Operating income from the Empeno Facil Mexico pawn segment decreased $0.3 million as expenses at new stores outpaced the segment's 23% net revenue growth, with one third of its stores opened in the last six months. Partially offsetting the increase in store level operating income was higher administrative costs and depreciation and a small loss on disposal of assets.

U.S. pawn acquisitions completed in November and December 2008 contributed net income of approximately $5.8 million and $0.07 per share after taking into account the increase in shares issued in the acquisitions.

Commenting on these results, President and Chief Executive Officer, Joe Rotunda, stated, "This was an outstanding quarter, our 30th consecutive quarter of year over year earnings growth, and clearly demonstrates our ability to consistently enhance earnings and provide shareholder value. Coupled with this strong financial performance is an expanding world-wide presence with our store growth in Mexico, entry into Canada, and our strategic affiliations with Albemarle & Bond in the United Kingdom and Cash Converters in Australia."

Rotunda continued, "In all segments of our business, we saw strong loan demand. It appears that our broadened range of loan offerings provides solutions to consumers' cash needs and are found to be more attractive than other options. With these strong ending loan portfolio balances, we are well positioned for a solid fiscal year."

Rotunda concluded, "For the March quarter, we expect earnings per share of approximately $0.43, compared to $0.37 for the same period a year ago. For our 2010 fiscal year ending September 30th, we are raising our earnings guidance to approximately $1.81 per share, compared to $1.42 per share for fiscal 2009. We remain on track to open 40 to 50 Empeno Facil pawn locations in Mexico and 35 to 45 CASHMAX payday loan stores in Canada, as well as six domestic pawn stores by fiscal year-end."

ABOUT EZCORP:

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 December 31, 2009, EZCORP operated a total of 920 locations, consisting of 370 U.S. pawnshops, 70 pawnshops in Mexico, 472 U.S. short-term consumer loan stores, and 8 short-term consumer loan stores in Canada. The Company also has significant investments in Albemarle & Bond Holdings PLC (ABM.L), one of the U.K.'s largest pawnbroking businesses with 115 stores, and Cash Converters International Limited (CCV.L and CCV.AUS), which franchises and operates 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 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 January 21, 2010 at 3:30 pm 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=65278

  For additional information, contact Brad Wolfe at (512) 314-2289.




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


                             Three Months Ended
                                December 31,       Increase      Percent
                              2009       2008     (Decrease)      Change
                              ----       ----     ----------      ------
  1 Revenues:
  2     Merchandise
         sales            $62,476    $44,795         $17,681         39.5
  3     Jewelry
         scrapping
         sales             37,442     19,785          17,657         89.2
  4     Pawn
         service
         charges           40,797     26,381          14,416         54.6
  5     Signature
         loan fees         38,678     36,000           2,678          7.4
  6     Auto
         title loan fees    3,102        221           2,881       1303.6
  7     Other               2,256      1,433             823         57.4
                            -----      -----             ---         ----
  8        Total
            revenues      184,751    128,615          56,136         43.6
  9 Cost of
     goods sold:
  10     Cost of
          merchandise
          sales             39,265     27,166          12,099         44.5
  11     Cost of
          jewelry
          scrapping
          sales             23,305     13,259          10,046         75.8
                            ------     ------          ------         ----
  12      Total cost of
           goods sold       62,570     40,425          22,145         54.8
  13 Bad debt:
  14   Signature
        loan bad debt        8,790      9,484            (694)        (7.3)
  15     Auto
          title loan
          bad debt             460          7             453       6471.4
                               ---        ---             ---       ------
  16        Total bad
             debt            9,250      9,491            (241)        (2.5)
                             -----      -----            ----         ----
  17 Net revenue           112,931     78,699          34,232         43.5
  18
  19 Operations expense     58,181     43,494          14,687         33.8
  20 Administrative
      expense               12,297     10,411           1,886         18.1
  21 Depreciation
      and amortization       3,356      3,066             290          9.5
  22 (Gain) /
   Loss on sale/
   disposal of
   assets                      211       (284)            495       (174.3)
                               ---       ----             ---       ------
  23 Operating income       38,886     22,012          16,874         76.7
  24
  25 Interest income            (8)      (126)            118        (93.7)
  26 Interest expense          365        165             200        121.2
  27 Equity in
   net income of
   unconsolidated
   affiliates               (1,283)      (941)           (342)        36.3

  28 Other                     (15)        25             (40)      (160.0)
                               ---        ---             ---       ------
  29 Income before income
   taxes                    39,827     22,889          16,938         74.0
  30 Income tax expense     14,120      8,061           6,059         75.2
                            ------      -----           -----         ----
  31 Net income            $25,707    $14,828         $10,879         73.4
                           =======    =======         =======         ====
  32

  33 Net income
   per share, diluted        $0.52      $0.33           $0.19         56.8
                             =====      =====           =====         ====
  34 Weighted average
   shares, diluted          49,400     44,692
  35
  36                                                     Amount or
                                                     Percentage Point
  37                                                      (ppt)
  38 OTHER DATA:                                    Increase (Decrease)
                                                    -------------------
  39 Gross margin on
   merchandise sales
   (lines (2-10)/2)          37.2%    39.4%           (2.2) ppts
  40 Gross margin on
   jewelry scrapping
   sales (lines (3-11)/3)    37.8%    33.0%            4.8  ppts
                             ----       ----           ---
  41 Gross margin on
   total sales (lines
   ((2+3)-12)/(2+3))         37.4%    37.4%            0.0 ppts
  42
  43 Signature loan bad debt
   as percent of
   fees (lines 14/5)         22.7%    26.3%           (3.6) ppts
  44 Auto title
   loan bad debt
   as percent of
   fees (lines 15/6)        14.8%     3.2%            11.6 ppts
  45
  46 Annualized inventory
   turnover                  3.7       3.3             0.4
  47
  48 Operating income margin
   (lines 23/17)            34.4%     28.0%            6.4 ppts






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


                                                             December 31,
                                                          2009          2008
                                                          ----          ----
    1    Assets:
    2      Current assets:
    3        Cash and cash equivalents                 $17,032       $41,595
    4        Pawn loans                                103,446        93,789
    5        Signature loans, net                        8,934         8,246
    6        Auto title loans, net                       2,110         1,174
    7        Pawn service charges receivable, net       19,662        16,888
    8        Signature loan fees receivable, net         6,044         5,968
             Auto title loan finance charges
    9         receivable, net                              827            92
    10       Inventory, net                             63,515        64,563
    11       Deferred tax asset                         15,671        15,773
    12       Prepaid expenses and other assets          20,654        12,284
                                                        ------        ------
    13            Total current assets                 257,895       260,372
    14
    15     Investment in unconsolidated
            affiliates                                  90,455        37,873
    16     Property and equipment, net                  52,378        46,674
    17     Deferred tax asset, non-current               5,011         7,754
    18     Goodwill                                    101,134        98,300
    19     Other assets, net                            19,931        18,693
                                                        ------        ------
    20          Total assets                          $526,804      $469,666
                                                      ========      ========
    21     Liabilities and stockholders'
            equity:
    22     Current liabilities:
    23       Current maturities of long-term
              debt                                     $10,000       $10,000
    24       Accounts payable and other accrued
              expenses                                  39,692        48,534
    25       Customer layaway deposits                   2,697         2,879
    26       Federal income taxes payable                6,480         3,186
                                                         -----         -----
    27            Total current liabilities             58,869        64,599
    28
    29      Long-term debt, less current
            maturities                                  22,500        30,337
    30      Deferred gains and other long-term
             liabilities                                 2,840         3,566
    31      Total stockholders' equity                 442,595       371,164
                                                       -------       -------
    32            Total liabilities and stockholders'
                   equity                             $526,804      $469,666
                                                      ========      ========
    33
    34   Pawn loan balance per ending pawn store          $235          $228
    35   Inventory per ending pawn store                  $144          $157
    36   Book value per share                            $9.08         $7.67
    37   Tangible book value per share                   $6.68         $5.28
    38   Pawn store count - end of period                  440           412
    39   Signature loan store count -end of period         480           477
    40   Shares outstanding - end of period             48,732        48,417






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



  Three months ended     U.S. Pawn    Empeno     EZMONEY
   December 31, 2009:  Operations      Facil    Operations    Consolidated
                       ----------      -----   ----------     ------------
  1 Revenues:
  2   Sales            $96,034        $3,872         $12           $99,918
  3   Pawn service
      charges           38,941         1,856           -            40,797
  4   Signature
       loan fees           553             -      38,125            38,678
  5   Auto title loan
       fees                475             -       2,627             3,102
  6   Other              2,167            89          -             2,256
                          -----           ---        ---             -----
  7     Total
        revenues         138,170         5,817     40,764           184,751
  8
  9 Cost of
     goods sold           59,730         2,833          7            62,570
  10 Signature
     loan bad debt           186             -      8,604             8,790
  11 Auto title loan
     bad debt                 70             -        390               460
                             ---           ---        ---               ---
  12     Net
          revenues        78,184         2,984     31,763           112,931
  13
  14 Operations
   expense                40,199         2,164     15,818            58,181
                          ------         -----     ------            ------
  15 Store level
   operating
   income                $37,985         $820     $15,945           $54,750
                         =======         ====      =======          =======
  16
  17 Gross margin on
   total sales (lines
   (2-9)/2)               37.8%        26.8%        41.7%             37.4%
  18 Annualized
   inventory turnover      3.7           3.9         N/A               3.7
  19 Signature
   loan bad debt as
   percent of fees
   (lines 10/4)             33.6%        N/A         22.6%           22.7%
  20 Auto title loan
   bad debt as percent
   of fees (lines
   11/5)                     14.7%       N/A         14.8%           14.8%
  21 Operating
   income margin
   (lines 15/12)             48.6%      27.5%        50.2%           48.5%
  22 Pawn store
   count - end of
   period                       370         70           -             440
  23 Signature
   loan store count -
   end of period                 6            -         474            480
  24
  25
  26 Three months ended
   December 31, 2008:
  27 Revenues:
  28   Sales               $62,167      $2,413          $-          $64,580
  29   Pawn service
        charges            24,884        1,497           -           26,381
  30    Signature
        loan fees            686             -      35,314           36,000
  31    Auto
         title loan
         fees                210             -          11              221
  32    Other              1,433             -           -            1,433
                           -----           ---         ---            -----
  33      Total
          revenues        89,380         3,910      35,325          128,615
  34
  35 Cost of
   goods sold            38,938         1,487           -           40,425
  36 Signature
   loan bad debt           236             -        9,248            9,484
  37 Auto title loan
   bad debt                  6             -           1                7
                           ---           ---         ---              ---
  38     Net
         revenues        50,200         2,423      26,076           78,699
  39
  40 Operations
   expense              26,678         1,284       15,532           43,494
                        ------         -----       ------           ------
  41 Store Level
   operating income    $23,522        $1,139     $10,544           $35,205
                       =======        ======      =======          =======
  42
  43 Gross margin on
   total sales
   (lines
   (28-35)/28)           37.4%         38.4%       N/A             37.4%
  44 Annualized
   inventory
   turnover               3.4           2.2         N/A             3.3
  45 Signature
   loan bad debt as
   percent of fees
   (lines 36/30)         34.4%          N/A       26.2%           26.3%
  46 Auto title loan
   bad debt as percent
   of fees (lines
   37/31)                 2.9%          N/A        9.1%            3.2%
  47 Operating income
   margin (lines
   41/38)                46.9%         47.0%      40.4%           44.7%
  48 Pawn store
   count - end of
   period                 371            41          -             412
  49 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
AP Archive: http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com

SOURCE: EZCORP, Inc.

CONTACT: Brad Wolfe, +1-512-314-2289, for EZCORP, Inc.

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

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