Release Details

EZCORP Reports Third Quarter Fiscal 2024 Results

Jul 31, 2024

Record PLO and Q3 Revenues

AUSTIN, Texas, July 31, 2024 (GLOBE NEWSWIRE) -- EZCORP, Inc. (NASDAQ: EZPW), a leading provider of pawn transactions in the United States and Latin America, today announced results for its third quarter ended June 30, 2024.

Unless otherwise noted, all amounts in this release are in conformity with U.S. generally accepted accounting principles (“GAAP”) and comparisons shown are to the same period in the prior year.

THIRD QUARTER HIGHLIGHTS

  • Pawn loans outstanding (PLO) up 14% to $261.7 million.
  • Total revenues increased 10% and gross profit increased 12%, while merchandise sales gross margin remains within our targeted range at 36%.
  • Net income of $18.0 million, compared to $18.2 million. On an adjusted basis1, net income increased $2.2 million or 14%.
  • Diluted earnings per share of $0.25, up from $0.24. On an adjusted basis, diluted earnings per share of $0.23, compared to $0.20.
  • Return on earning assets (ROEA) remains strong at 160%.

CEO COMMENTARY AND OUTLOOK

Lachie Given, Chief Executive Officer, stated, “Our team delivered another outstanding quarter for our shareholders, driven by strong customer demand and continued focus on operational execution at the store level. As a result, we achieved record Q3 revenues and our highest level of PLO in Company history. The challenging macro-economic climate continues to fuel robust customer interest in short-term cash solutions and high-quality pre-owned goods, and the team’s focus on market-leading customer service drove excellent operational and financial results, increasing adjusted EBITDA by 15% with expanded margin.

“During the quarter, we grew our footprint by adding twelve new stores, including six de novo stores in Latin America and one in the U.S., as well as acquiring five stores in the U.S. We now operate 1,258 stores and employ over 8,000 team members. Our strong, liquid balance sheet enables us to continue scaling the business, organically through new store openings and through strategic acquisitions. Additionally, we demonstrated our commitment to returning capital to shareholders by repurchasing $3.0 million worth of shares during the quarter. Subsequent to quarter end, we also settled our convertible notes that matured in 2024 with $34.4 million in cash and 77,328 shares.

“We continue to prioritize convenience and a seamless customer experience to drive loyalty and engagement. Our EZ+ Rewards program now boasts 5 million members globally, up 51% year-over-year. These members accounted for 76% of unique customer transactions during the quarter, illustrating the ongoing success of the program. Online payments also continue to gain traction with a 49% increase to $21.7 million collected in the U.S.

“We remain committed to a balanced capital allocation strategy in which we invest in our people and business to drive strong organic growth, execute value-enhancing acquisitions and investments, return capital to shareholders via strategic share repurchases, and maintain substantial liquidity to manage debt. The business is performing exceptionally well and I thank the team for their relentless focus on operational excellence to produce these results for all of our stakeholders,” concluded Given.

CONSOLIDATED RESULTS

Three Months Ended June 30 As Reported   Adjusted1
in millions, except per share amounts   2024     2023     2024     2023
               
Total revenues $ 281.4   $ 255.8   $ 279.8   $ 255.8
Gross profit $ 166.7   $ 148.8   $ 165.8   $ 148.8
Income before tax $ 23.0   $ 21.3   $ 22.8   $ 18.7
Net income $ 18.0   $ 18.2   $ 17.0   $ 14.9
Diluted earnings per share $ 0.25   $ 0.24   $ 0.23   $ 0.20
EBITDA (non-GAAP measure) $ 31.8   $ 30.2   $ 31.6   $ 27.6
                       
  • PLO increased 14% to $261.7 million, up $32.3 million. On a same-store basis, PLO increased 12% due to improved operational performance and continued strong pawn demand.
  • Total revenues increased 10%, and gross profit increased 12%, reflecting improved pawn service charge (PSC) revenues, merchandise sales and merchandise sales gross profit.
  • PSC increased 15% as a result of higher average PLO.
  • Merchandise sales gross margin remains within our target range at 36%. Aged general merchandise was 3.2% of total general merchandise inventory.
  • Net inventory increased 11%, as expected with the growth in PLO. Inventory turnover decreased to 2.7x, from 2.8x.
  • Store expenses increased 11% and 8% on a same-store basis, primarily due to increased labor in-line with store activity and, to a lesser extent, expenses related to our loyalty program.
  • General and administrative expenses increased 12%, primarily due to labor, incentive compensation and, to a lesser extent, costs related to the implementation and ongoing support of Workday.
  • Income before taxes was $23.0 million, up from $21.3 million, and adjusted EBITDA increased 15% to $31.6 million, with the primary adjustment being in the prior year for the reversal of contingent consideration liability in connection with a previously completed acquisition.
  • Diluted earnings per share of $0.25, up from $0.24. On an adjusted basis, diluted earnings per share of $0.23, up from $0.20.
  • Cash and cash equivalents at the end of the quarter was $218.0 million, down 8% year-over-year. The decrease was due to the increase in PLO and inventory, strategic investments and acquisitions, and share repurchases, partially offset by cash from operating activities.

SEGMENT RESULTS

U.S. Pawn

  • PLO ended the quarter at $199.3 million, up 11% or 10% on a same-store basis.
  • Total revenues were up 8% and gross profit was up 9%, reflecting increased PSC and higher merchandise sales.
  • PSC increased 13% as a result of higher average PLO.
  • Merchandise sales increased 6%, and gross margin decreased to 38% from 39%. Aged general merchandise increased to 5.0% to $2.0 million of total general merchandise inventory. Excluding luxury handbags in our three Max Pawn stores in Las Vegas, aged general merchandise remains under 1%.
  • Net inventory increased 6%, as expected with the growth in PLO. Inventory turnover remained flat at 2.6x.
  • Store expenses increased 8% and 6% on a same-store basis, primarily due to increased labor in-line with store activity and to a lesser extent, expenses related to our loyalty program.
  • Segment contribution increased 12% to $36.1 million.
  • During the quarter, store count increased by six, due to the acquisition of five stores and opening of one de novo store.

Latin America Pawn

  • PLO improved to $62.4 million, up 24% (30% on constant currency basis). On a same-store basis, PLO increased 20% (26% on a constant currency basis) due to improved operational performance and increased loan demand.
  • Total revenues were up 15% (13% on constant currency basis), and gross profit increased 21% (19% on a constant currency basis), reflecting increased PSC, higher merchandise sales and improved merchandise sales gross profit.
  • PSC increased 22% (19% on a constant currency basis) as a result of higher average PLO.
  • Merchandise sales gross margin increased to 32% from 30%. Aged general merchandise was less than 1% of total merchandise inventory.
  • Net inventory increased 25% (32% on a constant currency basis). Inventory turnover decreased to 3.0x, from 3.4x.
  • Store expenses increased 18% (15% on a constant currency basis) and 14% (12% on a constant currency basis) on a same-store basis, primarily due to increased labor, in line with store activity and to a lesser extent, rent.
  • Segment contribution increased 6% (5% on a constant currency basis). On an adjusted basis, segment contribution was up 43% to $10.2 million, with the primary adjustment being the prior year reversal of contingent consideration liability in connection with a previously completed acquisition.
  • During the quarter, store count increased by six de novo stores.

FORM 10-Q

EZCORP’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 has been filed with the Securities and Exchange Commission. The report is available in the Investor Relations section of the Company’s website at http://investors.ezcorp.com

CONFERENCE CALL
EZCORP will host a conference call on Thursday, August 1, 2024, at 8:00 am Central Time to discuss Third Quarter Fiscal 2024 results. Analysts and institutional investors may participate on the conference call by registering online at https://register.vevent.com/register/BId4b5469876114f61a4e1f86df672523c. Once registered you will receive the dial-in details with a unique PIN to join the call. The conference call will be webcast simultaneously to the public through this link: http://investors.ezcorp.com. A replay of the conference call will be available online at http://investors.ezcorp.com shortly after the end of the call. 

ABOUT EZCORP

Formed in 1989, EZCORP has grown into a leading provider of pawn transactions in the United States and Latin America. We also sell pre-owned and recycled merchandise, primarily collateral forfeited from pawn lending operations and merchandise purchased from customers. We are dedicated to satisfying the short-term cash needs of consumers who are both cash and credit constrained, focusing on an industry-leading customer experience. EZCORP is traded on NASDAQ under the symbol EZPW and is a member of the S&P 1000 Index and Nasdaq Composite Index. 

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FORWARD LOOKING STATEMENTS

This announcement contains certain forward-looking statements regarding the Company’s strategy, initiatives and expected performance. These statements are based on the Company’s current expectations as to the outcome and timing of future events. All statements, other than statements of historical facts, including all statements regarding the Company's strategy, initiatives and future performance, that address activities or results that the Company plans, expects, believes, projects, estimates or anticipates, will, should or may occur in the future, including future financial or operating results, are forward-looking statements. 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 operating risks, liquidity risks, legislative or regulatory developments, market factors, current or future litigation and risks associated with the COVID-19 pandemic. 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. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

Contact:
Email: Investor_Relations@ezcorp.com 
Phone: (512) 314-2220

Note: Percentages are calculated from the underlying numbers in thousands and, as a result, may not agree to the percentages calculated from numbers in millions.
1“Adjusted” basis, which is a non-GAAP measure, excludes certain items. “Constant currency” basis, which is a non-GAAP measure, excludes the impact of foreign currency exchange rate fluctuations. For additional information about these calculations, as well as a reconciliation to the most comparable GAAP financial measures, see “Non-GAAP Financial Information” at the end of this release.

2“Same Store” basis, which is a financial measure, includes stores open the entirety of the comparable periods.

 

EZCORP, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

  Three Months Ended
June 30,
  Nine Months Ended
June 30,
(in thousands, except per share amounts)   2024       2023       2024       2023  
Revenues:              
Merchandise sales $ 158,140     $ 147,980     $ 502,230     $ 464,274  
Jewelry scrapping sales   15,395       13,931       43,191       34,640  
Pawn service charges   107,830       93,819       321,442       279,442  
Other revenues   56       82       188       206  
Total revenues   281,421       255,812       867,051       778,562  
Merchandise cost of goods sold   101,211       95,069       322,680       297,285  
Jewelry scrapping cost of goods sold   13,483       11,958       37,479       30,813  
Gross profit   166,727       148,785       506,892       450,464  
Operating expenses:              
Store expenses   116,335       104,932       341,472       307,004  
General and administrative   20,060       17,876       54,869       48,961  
Depreciation and amortization   8,158       8,026       24,942       23,977  
Loss (gain) on sale or disposal of assets and other   20       (29 )     (149 )     28  
Other income         (2,632 )     (765 )     (5,097 )
Total operating expenses   144,573       128,173       420,369       374,873  
Operating income   22,154       20,612       86,523       75,591  
Interest expense   3,539       3,414       10,381       12,994  
Interest income   (2,931 )     (2,584 )     (8,452 )     (5,146 )
Equity in net (income) loss of unconsolidated affiliates   (1,263 )     (1,523 )     (4,135 )     29,394  
Other income   (191 )     (5 )     (627 )     (159 )
Income before income taxes   23,000       21,310       89,356       38,508  
Income tax expense   5,050       3,088       21,457       10,298  
Net income $ 17,950     $ 18,222     $ 67,899     $ 28,210  
               
Basic earnings per share $ 0.33     $ 0.33     $ 1.23     $ 0.51  
Diluted earnings per share $ 0.25     $ 0.24     $ 0.89     $ 0.38  
               
Weighted-average basic shares outstanding   54,898       55,367       55,022       55,776  
Weighted-average diluted shares outstanding   83,008       86,825       84,309       79,559  
                               

EZCORP, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

(in thousands, except share and per share amounts) June 30,
2024
  June 30,
2023
  September 30,
2023
           
Assets:          
Current assets:          
Cash and cash equivalents $ 218,038     $ 237,974     $ 220,595  
Restricted cash   9,204       8,549       8,373  
Pawn loans   261,720       229,379       245,766  
Pawn service charges receivable, net   40,638       34,959       38,885  
Inventory, net   171,937       154,944       166,477  
Prepaid expenses and other current assets   40,391       44,925       39,623  
    Total current assets   741,928       710,730       719,719  
Investments in unconsolidated affiliates   12,297       10,247       10,987  
Other investments   51,220       39,220       36,220  
Property and equipment, net   59,926       61,849       68,096  
Right-of-use assets, net   235,030       243,100       234,388  
Goodwill   308,847       302,120       302,372  
Intangible assets, net   60,164       60,009       58,216  
Deferred tax asset, net   25,245       19,610       25,702  
Other assets, net   15,506       10,793       12,011  
Total assets $ 1,510,163     $ 1,457,678     $ 1,467,711  
           
Liabilities and equity:          
Current liabilities:          
Current maturities of long-term debt, net $ 137,326     $     $ 34,265  
Accounts payable, accrued expenses and other current liabilities   69,742       74,458     $ 81,605  
Customer layaway deposits   20,067       18,595       18,920  
Operating lease liabilities, current   58,905       56,919       57,182  
    Total current liabilities   286,040       149,972       191,972  
Long-term debt, net   223,998       359,686       325,847  
Deferred tax liability, net   416       349       435  
Operating lease liabilities   188,996       197,499       193,187  
Other long-term liabilities   9,258       11,130       10,502  
    Total liabilities   708,708       718,636       721,943  
Commitments and contingencies (Note 9)          
Stockholders’ equity:          
Class A Non-voting Common Stock, par value $0.01 per share; shares authorized: 100 million; issued and outstanding : 51,771,917 as of June 30, 2024; 52,214,761 as of June 30, 2023; and 51,869,569 as of September 30, 2023   518       522       519  
Class B Voting Common Stock, convertible, par value $0.01 per share; shares authorized: 3 million; issued and outstanding: 2,970,171   30       30       30  
Additional paid-in capital   347,082       344,857       346,181  
Retained earnings   493,830       422,549       431,140  
Accumulated other comprehensive loss   (40,005 )     (28,916 )     (32,102 )
    Total equity   801,455       739,042       745,768  
Total liabilities and equity $ 1,510,163     $ 1,457,678     $ 1,467,711  

 

EZCORP, Inc.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

  Nine Months Ended
June 30,
(in thousands)   2024       2023  
   
Operating activities:      
Net income $ 67,899     $ 28,210  
Adjustments to reconcile net income to net cash flows from operating activities:      
Depreciation and amortization   24,942       23,977  
Amortization of debt discount and deferred financing costs   1,212       1,135  
Non-cash lease expense   43,999       41,752  
Deferred income taxes   438       (7,489 )
Other adjustments   69       (4,894 )
Provision for inventory reserve   589       (160 )
Stock compensation expense   7,945       6,876  
Equity in net (income) loss from investment in unconsolidated affiliates   (4,135 )     29,394  
Net loss on extinguishment of debt         3,545  
Changes in operating assets and liabilities, net of business acquisitions:      
Pawn service charges receivable   (1,593 )     (316 )
Inventory   (2,775 )     (5,501 )
Prepaid expenses, other current assets and other assets   (3,625 )     (2,750 )
Accounts payable, accrued expenses and other liabilities   (65,396 )     (53,018 )
Customer layaway deposits   1,055       1,036  
Income taxes   (360 )     8,923  
Dividends from unconsolidated affiliates         3,589  
   Net cash provided by operating activities   70,264       74,309  
Investing activities:      
Loans made   (683,121 )     (592,689 )
Loans repaid   391,297       343,886  
Recovery of pawn loan principal through sale of forfeited collateral   272,781       251,608  
Capital expenditures, net   (16,870 )     (27,751 )
Acquisitions, net of cash acquired   (11,963 )     (12,968 )
Proceeds from (issuance of) notes receivable   1,100       (15,500 )
Investment in unconsolidated affiliate   (993 )     (2,133 )
Investment in other investments   (15,000 )     (15,000 )
Dividends from unconsolidated affiliates   3,535        
   Net cash used in investing activities   (59,234 )     (70,547 )
Financing activities:      
Taxes paid related to net share settlement of equity awards   (3,253 )     (1,149 )
Proceeds from issuance of debt         230,000  
Debt issuance cost         (7,458 )
Cash paid on extinguishment of debt         (1,951 )
Payments on debt         (178,488 )
Purchase and retirement of treasury stock   (9,009 )     (13,982 )
Payments of finance leases   (386 )      
   Net cash (used in) provided by financing activities   (12,648 )     26,972  
Effect of exchange rate changes on cash and cash equivalents and restricted cash   (108 )     1,420  
Net (decrease) increase in cash, cash equivalents and restricted cash   (1,726 )     32,154  
Cash and cash equivalents and restricted cash at beginning of period   228,968       214,369  
Cash and cash equivalents and restricted cash at end of period $ 227,242     $ 246,523  
       

EZCORP, Inc.
OPERATING SEGMENT RESULTS

  Three Months Ended June 30, 2024
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 107,849     $ 50,291     $     $ 158,140     $     $ 158,140  
Jewelry scrapping sales   13,757       1,638             15,395             15,395  
Pawn service charges   77,416       30,414             107,830             107,830  
Other revenues   28       28             56             56  
Total revenues   199,050       82,371             281,421             281,421  
Merchandise cost of goods sold   67,229       33,982             101,211             101,211  
Jewelry scrapping cost of goods sold   11,887       1,596             13,483             13,483  
Gross profit   119,934       46,793             166,727             166,727  
Segment and corporate expenses (income):                      
Store expenses   81,441       34,894             116,335             116,335  
General and administrative                           20,060       20,060  
Depreciation and amortization   2,408       2,090             4,498       3,660       8,158  
(Gain) loss on sale or disposal of assets and other   (2 )     22             20             20  
Interest expense                           3,539       3,539  
Interest income         (370 )     (605 )     (975 )     (1,956 )     (2,931 )
Equity in net (income) loss of unconsolidated affiliates               (1,406 )     (1,406 )     143       (1,263 )
Other (income) expense         (184 )     12       (172 )     (19 )     (191 )
Segment contribution $ 36,087     $ 10,341     $ 1,999     $ 48,427          
Income (loss) before income taxes             $ 48,427     $ (25,427 )   $ 23,000  

        

   
  Three Months Ended June 30, 2023
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 102,177     $ 45,803     $     $ 147,980     $     $ 147,980  
Jewelry scrapping sales   13,098       833             13,931             13,931  
Pawn service charges   68,790       25,029             93,819             93,819  
Other revenues   27       40       15       82             82  
Total revenues   184,092       71,705       15       255,812             255,812  
Merchandise cost of goods sold   62,799       32,270             95,069             95,069  
Jewelry scrapping cost of goods sold   11,101       857             11,958             11,958  
Gross profit   110,192       38,578       15       148,785             148,785  
Segment and corporate expenses (income):                      
Store expenses   75,389       29,543             104,932             104,932  
General and administrative                           17,876       17,876  
Depreciation and amortization   2,505       2,303             4,808       3,218       8,026  
Gain on sale or disposal of assets         (29 )           (29 )           (29 )
Other income         (2,632 )           (2,632 )           (2,632 )
Interest expense                           3,414       3,414  
Interest income   (1 )     (256 )           (257 )     (2,327 )     (2,584 )
Equity in net income of unconsolidated affiliates               (1,523 )     (1,523 )           (1,523 )
Other (income) expense         (65 )     10       (55 )     50       (5 )
Segment contribution $ 32,299     $ 9,714     $ 1,528     $ 43,541          
Income (loss) before income taxes             $ 43,541     $ (22,231 )   $ 21,310  
                       

 

  Nine Months Ended June 30, 2024
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 348,211     $ 154,019     $     $ 502,230     $     $ 502,230  
Jewelry scrapping sales   39,258       3,933             43,191             43,191  
Pawn service charges   236,499       84,943             321,442             321,442  
Other revenues   94       59       35       188             188  
Total revenues   624,062       242,954       35       867,051             867,051  
Merchandise cost of goods sold   218,736       103,944             322,680             322,680  
Jewelry scrapping cost of goods sold   33,965       3,514             37,479             37,479  
Gross profit   371,361       135,496       35       506,892             506,892  
Segment and corporate expenses (income):                      
Store expenses   239,536       101,936             341,472             341,472  
General and administrative                           54,869       54,869  
Depreciation and amortization   7,548       6,821             14,369       10,573       24,942  
(Gain) loss on sale or disposal of assets and other   (6 )     (240 )           (246 )     97       (149 )
Other income                           (765 )     (765 )
Interest expense                           10,381       10,381  
Interest income         (1,398 )     (1,811 )     (3,209 )     (5,243 )     (8,452 )
Equity in net (income) loss of unconsolidated affiliates               (4,278 )     (4,278 )     143       (4,135 )
Other (income) expense         (231 )     27       (204 )     (423 )     (627 )
Segment contribution   124,283       28,608     $ 6,097     $ 158,988          
Income (loss) before income taxes             $ 158,988     $ (69,632 )   $ 89,356  

 

   
  Nine Months Ended June 30, 2023
(Unaudited)
(in thousands) U.S. Pawn   Latin America Pawn   Other Investments   Total Segments   Corporate Items   Consolidated
                       
Revenues:                      
Merchandise sales $ 329,231     $ 135,043     $     $ 464,274     $     $ 464,274  
Jewelry scrapping sales   30,088       4,552             34,640             34,640  
Pawn service charges   208,045       71,397             279,442             279,442  
Other revenues   84       75       47       206             206  
Total revenues   567,448       211,067       47       778,562             778,562  
Merchandise cost of goods sold   203,698       93,587             297,285             297,285  
Jewelry scrapping cost of goods sold   25,867       4,946             30,813             30,813  
Gross profit   337,883       112,534       47       450,464             450,464  
Segment and corporate expenses (income):                      
Store expenses   220,639       86,365             307,004             307,004  
General and administrative         (3 )           (3 )     48,964       48,961  
Depreciation and amortization   7,820       6,850             14,670       9,307       23,977  
Loss (gain) on sale or disposal of assets   84       (56 )           28             28  
Other income         (5,097 )           (5,097 )           (5,097 )
Interest expense                           12,994       12,994  
Interest income   (2 )     (723 )           (725 )     (4,421 )     (5,146 )
Equity in net loss of unconsolidated affiliates               29,394       29,394             29,394  
Other (income) expense         (41 )     20       (21 )     (138 )     (159 )
Segment contribution (loss) $ 109,342     $ 25,239     $ (29,367 )   $ 105,214          
Income (loss) before income taxes             $ 105,214     $ (66,706 )   $ 38,508  

EZCORP, Inc.
STORE COUNT ACTIVITY
(Unaudited)

  Three Months Ended June 30, 2024
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of March 31, 2024 535   711   1,246
New locations opened 1   6   7
Locations acquired 5     5
As of June 30, 2024 541   717   1,258

 

  Three Months Ended June 30, 2023
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of March 31, 2023 527   672   1,199
New locations opened 1   12   13
As of June 30, 2023 528   684   1,212

 

  Nine Months Ended June 30, 2024
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of September 30, 2023 529     702     1,231  
New locations opened 1     20     21  
Locations acquired 12         12  
Locations combined or closed (1 )   (5 )   (6 )
As of June 30, 2024 541     717     1,258  

 

  Nine Months Ended June 30, 2023
  U.S. Pawn   Latin America Pawn   Consolidated
           
As of September 30, 2022 515   660     1,175  
New locations opened 3   25     28  
Locations acquired 10       10  
Locations combined or closed   (1 )   (1 )
As of June 30, 2023 528   684     1,212  

 

Non-GAAP Financial Information (Unaudited)

In addition to the financial information prepared in conformity with accounting U.S. generally accepted accounting principles (“GAAP”), we provide certain other non-GAAP financial information on a constant currency (“constant currency”) and adjusted basis. We use constant currency results to evaluate our Latin America Pawn operations, which are denominated primarily in Mexican pesos, Guatemalan quetzales and other Latin American currencies. We believe that presentation of constant currency and adjusted results is meaningful and useful in understanding the activities and business metrics of our operations and reflect an additional way of viewing aspects of our business that, when viewed with GAAP results, provide a more complete understanding of factors and trends affecting our business. We provide non-GAAP financial information for informational purposes and to enhance understanding of our GAAP consolidated financial statements. We use this non-GAAP financial information primarily to evaluate and compare operating results across accounting periods.

Readers should consider the information in addition to, but not instead of or superior to, our financial statements prepared in accordance with GAAP. This non-GAAP financial information may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes.

Constant currency results reported herein are calculated by translating consolidated balance sheet and consolidated statement of operations items denominated in local currency to U.S. dollars using the exchange rate from the prior-year comparable period, as opposed to the current period, in order to exclude the effects of foreign currency rate fluctuations. In addition, we have an equity method investment that is denominated in Australian dollars and is translated into U.S. dollars. We used the end-of-period rate for balance sheet items and the average closing daily exchange rate on a monthly basis during the appropriate period for statement of operations items. The end-of-period and approximate average exchange rates for each applicable currency as compared to U.S. dollars as of and for the three and nine months ended June 30, 2024 and 2023 were as follows:

    June 30,   Three Months Ended
June 30,
  Nine Months Ended
June 30,
    2024   2023   2024   2023   2024   2023
                         
Mexican peso   18.3   17.1   17.2   17.7   17.3   18.7
Guatemalan quetzal   7.6   7.7   7.6   7.6   7.6   7.6
Honduran lempira   24.3   24.4   24.3   24.3   24.3   24.3
Australian dollar   1.5   1.5   1.5   1.5   1.5   1.5
                         

Our statement of operations constant currency results reflect the monthly exchange rate fluctuations and so are not directly calculable from the above rates. Constant currency results, where presented, also exclude the foreign currency gain or loss.

Miscellaneous Non-GAAP Financial Measures

  Three Months Ended
June 30,
(in millions)   2024       2023  
       
Net income $ 18.0     $ 18.2  
Interest expense   3.5       3.4  
Interest income   (2.9 )     (2.6 )
Income tax expense   5.0       3.1  
Depreciation and amortization   8.2       8.0  
EBITDA $ 31.8     $ 30.2  

 

  Total Revenues   Gross Profit   Income Before Tax   Tax Effect   Net Income   Diluted EPS   EBITDA
                           
2024 Q3 Reported $ 281.4     $ 166.7     $ 23.0     $ 5.0   $ 18.0     $ 0.25     $ 31.8  
Impact of dilutive instruments*                               (0.01 )      
FX Impact               0.1                       0.1  
Constant Currency and other impact   (1.6 )     (0.9 )     (0.3 )     0.8     (1.0 )     (0.01 )     (0.3 )
2024 Q3 Adjusted $ 279.8     $ 165.8     $ 22.8     $ 5.8   $ 17.0     $ 0.23     $ 31.6  

 

  Total Revenues   Gross Profit   Income Before Tax   Tax Effect   Net Income   Diluted EPS   EBITDA
                           
2023 Q3 Reported $ 255.8   $ 148.8   $ 21.3     $ 3.1     $ 18.2     $ 0.24     $ 30.2  
Contingent consideration acquisition transaction           (2.6 )     (0.5 )     (2.1 )     (0.02 )     (2.6 )
Tax Impact                 1.2       (1.2 )     (0.02 )      
2023 Q3 Adjusted $ 255.8   $ 148.8   $ 18.7     $ 3.8     $ 14.9     $ 0.20     $ 27.6  

 

  Three Months Ended
June 30, 2024
  Nine Months Ended
June 30, 2024
(in millions) U.S. Dollar Amount   Percentage Change YOY   U.S. Dollar Amount   Percentage Change YOY
               
Consolidated revenues $ 281.4     10 %   $ 867.1     11 %
Currency exchange rate fluctuations   (1.6 )         (14.2 )    
Constant currency consolidated revenues $ 279.8     9 %   $ 852.8     10 %
               
Consolidated gross profit $ 166.7     12 %   $ 506.9     13 %
Currency exchange rate fluctuations   (0.9 )         (7.7 )    
Constant currency consolidated gross profit $ 165.8     11 %   $ 499.2     11 %
               
Consolidated net inventory $ 171.9     11 %   $ 171.9     11 %
Currency exchange rate fluctuations   2.7           2.7      
Constant currency consolidated net inventory $ 174.6     13 %   $ 174.6     13 %
               
Latin America Pawn gross profit $ 46.8     21 %   $ 135.5     20 %
Currency exchange rate fluctuations   (0.9 )         (7.7 )    
Constant currency Latin America Pawn gross profit $ 45.9     19 %   $ 127.8     14 %
               
Latin America Pawn PLO $ 62.4     24 %   $ 62.4     24 %
Currency exchange rate fluctuations   3.0           3.0      
Constant currency Latin America Pawn PLO $ 65.4     30 %   $ 65.4     30 %
               
Latin America Pawn PSC revenues $ 30.4     22 %   $ 84.9     19 %
Currency exchange rate fluctuations   (0.6 )         (4.5 )    
Constant currency Latin America Pawn PSC revenues $ 29.8     19 %   $ 80.4     13 %
               
Latin America Pawn merchandise sales $ 50.3     10 %   $ 154.0     14 %
Currency exchange rate fluctuations   (1.0 )         (9.5 )    
Constant currency Latin America Pawn merchandise sales $ 49.3     8 %   $ 144.5     7 %
               
Latin America Pawn segment profit before tax $ 10.3     6 %   $ 28.6     13 %
Currency exchange rate fluctuations   (0.1 )         (1.1 )    
Constant currency Latin America Pawn segment profit before tax $ 10.2     5 %   $ 27.5     9 %