FirstCash, Inc. (the “Company”) (Nasdaq: FCFS), the leading
international operator of over 2,800 retail pawn stores in the U.S.
and Latin America, today announced operating results for the three
and six month periods ended June 30, 2021, and an update on
the impact of COVID-19 on its business. In addition, the Board of
Directors declared a $0.30 per share quarterly cash dividend to be
paid in August 2021.
Mr. Rick Wessel, chief executive officer,
stated, “FirstCash posted strong second quarter earnings results
driven by an accelerating recovery in pawn receivables and the
continued strength of retail operations. At this point, Latin
American pawn receivable balances have substantially recovered from
the impacts of COVID-19 while U.S. pawn loan originations are
rapidly approaching normalized levels as we begin the second half
of the year.
“Second quarter highlights also include the
acquisition of a 26-store chain of high-performing pawn stores in
Texas and 12 de novo store openings during the quarter. FirstCash’s
store count has now surpassed 2,800 total locations and we believe
there are additional growth opportunities ahead. In addition to
funding store growth, our strong cash flows and balance sheet
returned cash to shareholders through a quarterly cash dividend of
$0.30 per share and $38 million in share repurchases during the
first half of 2021.”
This release contains adjusted earnings
measures, which exclude certain extraordinary and/or non-cash
expenses, which are non-GAAP financial measures. Please refer to
the descriptions and reconciliations to GAAP of these and other
non-GAAP financial measures at the end of this release.
|
|
Three Months Ended June 30, |
|
|
As Reported (GAAP) |
|
Adjusted (Non-GAAP) |
In thousands, except per share
amounts |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Revenue |
|
$ |
389,578 |
|
|
$ |
412,746 |
|
|
$ |
389,578 |
|
|
$ |
412,746 |
|
Net income |
|
$ |
28,427 |
|
|
$ |
25,873 |
|
|
$ |
29,038 |
|
|
$ |
25,872 |
|
Diluted earnings per
share |
|
$ |
0.70 |
|
|
$ |
0.62 |
|
|
$ |
0.71 |
|
|
$ |
0.62 |
|
EBITDA (non-GAAP measure) |
|
$ |
56,786 |
|
|
$ |
53,962 |
|
|
$ |
57,524 |
|
|
$ |
53,930 |
|
Weighted-average diluted
shares |
|
40,802 |
|
|
41,531 |
|
|
40,802 |
|
|
41,531 |
|
|
|
Six Months Ended June 30, |
|
|
As Reported (GAAP) |
|
Adjusted (Non-GAAP) |
In thousands, except per share
amounts |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Revenue |
|
$ |
797,517 |
|
|
$ |
879,236 |
|
|
$ |
797,517 |
|
|
$ |
879,236 |
|
Net income |
|
$ |
62,142 |
|
|
$ |
58,791 |
|
|
$ |
63,966 |
|
|
$ |
66,167 |
|
Diluted earnings per
share |
|
$ |
1.52 |
|
|
$ |
1.41 |
|
|
$ |
1.56 |
|
|
$ |
1.59 |
|
EBITDA (non-GAAP measure) |
|
$ |
120,741 |
|
|
$ |
118,586 |
|
|
$ |
123,125 |
|
|
$ |
128,536 |
|
Weighted-average diluted
shares |
|
40,929 |
|
|
41,769 |
|
|
40,929 |
|
|
41,769 |
|
Consolidated Earnings
Highlights
- Diluted earnings
per share for the second quarter increased 13% on a GAAP basis and
increased 15% on an adjusted non-GAAP basis compared to the
prior-year quarter. Year-to-date diluted earnings per share
increased 8% on a GAAP basis and decreased 2% on an adjusted
non-GAAP basis compared to the prior year.
- Operating results
in the second quarter reflected increased revenues in Latin America
coupled with improved gross margins and lower operating expenses in
the U.S., which more than offset the expected revenue decline in
the U.S.:
- Pawn loans
outstanding at quarter end increased 35% over the prior year and
29% on a constant currency basis. Resulting pawn fees, which
typically lag the growth in pawn receivables, increased 8% in total
and 2% on a constant currency basis in the second quarter compared
to the prior-year quarter.
- Retail sales gross
margins of 42% in the second quarter remained at record levels and
improved over the 40% gross margins achieved in the second quarter
of last year. Despite higher than normal U.S. retail comps a year
ago when many competing retailers were shut down due to the
pandemic, second quarter merchandise gross profit decreased only 3%
compared to the same quarter of 2020.
- Increased inventory
turns and margins resulted in a record return on earning assets
(trailing twelve months net revenue divided by average pawn
receivables and inventories) of 190% as of June 2021 compared to
172% in June of 2020.
- The Company
continued to optimize operating expenses which resulted in store
level expense reductions of 1% on a U.S. dollar basis and 5% on a
constant currency basis versus the prior-year quarter.
Administrative expenses were reduced 3% on a dollar reported basis
and 6% on a constant currency basis compared to the prior
year.
- The adjusted EBITDA
margin for the second quarter of 2021 was 15% compared to a 13%
margin in the second quarter of 2020.
Acquisitions and Store Opening
Highlights
- The Company
acquired 26 U.S. pawn stores located in the Houston and San Antonio
markets of Texas in mid-May. Year-to-date, a total of 28 U.S.
stores have been acquired for an aggregate purchase price of
approximately $51 million.
- A total of 12 de
novo locations were opened during the second quarter, which
included 10 locations in Mexico, one in Colombia and one in the
U.S. A total of 36 stores have been opened year-to-date. In
addition, a total of eight locations in Mexico have relocated or
expanded thus far in 2021 while another three locations in Mexico
have been consolidated with overlapping stores.
- With the addition
of 64 total stores year-to-date, the Company now operates 2,804
stores, with 1,733 stores located in Latin America and 1,071 stores
in the U.S. The Latin American locations include 1,645 stores in
Mexico, 60 stores in Guatemala, 15 stores in Colombia and 13 stores
in El Salvador.
U.S. Pawn Operations
- Pawn receivables
were up 29% at June 30, 2021 compared to the prior year while
same-store pawn receivables increased 24% at quarter end,
reflecting further recovery in pawn balances, especially in the
latter half of the quarter. Resulting pawn fees, which typically
lag pawn receivables growth, were down only 7% in total for the
second quarter, and 9% on a same-store basis, compared to the
prior-year quarter.
- Retail sales for
the second quarter of 2021 were down 17% compared to the prior-year
quarter, which was expected given the especially robust retail
sales in the second quarter of 2020 when many other U.S. retailers
were closed due to the pandemic. On a same store-basis, retail
sales declined 19% compared to the prior-year quarter.
- Retail margins
continued to expand, with second quarter retail margins of 45%
compared to 42% in the same quarter last year. The strength in
retail margins reflect continued retail demand for value-priced,
pre-owned merchandise, increased buying of fresh merchandise from
customers and lower levels of aged inventory, all of which limited
the need for normal discounting.
- Inventories
increased 20% on a year-over-year basis, and while not recovered to
normalized levels, the inventory turnover rate at 3.1 times for the
trailing twelve months ended June 30, 2021 reflects improved retail
efficiency. Inventories aged greater than one year as of June 30,
2021 declined further to 1%.
- Wholesale scrap
jewelry margins improved to 21% in the second quarter of 2021
compared to 12% in the respective prior-year period, as the Company
benefited from increased gold prices compared to last year. Despite
lower sales volumes, net revenue from non-core scrap jewelry sales
increased 30% for the quarter compared to the prior-year quarter as
a result of the increased margins.
- Store operating
expenses decreased 9% in total and 11% on a same-store basis
compared to the prior-year quarter, reflecting the continued
expense optimization efforts from reduced staffing levels through
normal attrition, reduced store hours in some markets and other
cost saving initiatives.
- The segment pre-tax
operating margin improved to 19% for the second quarter of 2021
compared to 18% for the prior-year quarter. On a year-to-date
basis, the segment pre-tax operating margin was 21%, a significant
improvement over the 19% margin in the respective prior-year
period.
Note: Certain growth rates in “Latin America
Pawn Operations” below are calculated on a constant currency basis,
a non-GAAP financial measure defined at the end of this release.
The average Mexican peso to U.S. dollar exchange rate for the three
month period ended June 30, 2021 was 20.1 pesos / dollar, a
favorable change of 14% versus the comparable prior-year period,
and for the six month period ended June 30, 2021 was 20.2
pesos / dollar, a favorable change of 6% versus the prior-year
period.
Latin America Pawn
Operations
-
Pawn receivables at June 30, 2021 were up 50% compared to the prior
year, and 30% on a constant currency basis, on both a total and
same-store basis.
-
Pawn fees increased 43% in the second quarter, or 24% on a constant
currency basis, as compared to the prior-year quarter. On a
same-store basis, pawn fees increased 42% on a U.S. dollar basis
and 23% on a constant currency basis compared to the prior-year
quarter.
-
Retail sales for the second quarter increased 18%, or 2% on a
constant currency basis, compared to the prior-year quarter.
Same-store retail sales increased 16% on a U.S. dollar basis and 1%
on a constant currency basis compared to the prior-year
quarter.
-
Retail margins continued to strengthen at 37% in the second quarter
of 2021 compared to 36% in the second quarter of 2020. As in the
U.S., the improved margins reflect fresher inventories and
continued demand for popular value-priced consumer electronics. As
a result, gross profit from retail sales increased 21% on a U.S.
dollar basis, or 4% on a constant currency basis, in the second
quarter compared to the prior-year quarter.
-
Further reflecting the improved retail efficiency, annualized
inventory turnover was a near record at 4.4 times for the trailing
twelve months ended June 30, 2021 compared to 3.9 turns in the same
period last year. Inventories aged greater than one year as of June
30, 2021 declined further to 1%.
- Store operating
expenses increased 21% on a U.S. dollar basis but only 5% on a
constant currency basis while same-store operating expenses
increased 19%, or 4% on a constant currency basis, compared to the
prior-year quarter. As a reminder, store operating expenses in the
prior-year quarter were lower than normal in part due to temporary
store closures and restrictions on retail operations in most Latin
American markets due to the pandemic.
- Segment pre-tax
operating income for the second quarter of 2021 increased $7
million, or 36%, ($4 million, or 20% on a constant currency basis)
over the prior-year quarter. The resulting segment pre-tax
operating margin increased to 20% for the second quarter of 2021
(also 20% on a constant currency basis) compared to 17% in the
prior-year quarter.
Liquidity and Shareholder Returns
- The Company
generated $193 million in cash flow from operations and $77 million
in adjusted free cash flow during the trailing twelve months ended
June 30, 2021 compared to $269 million of cash flow from operations
and $421 million of adjusted free cash flow during the same
prior-year period.
- During the second
quarter, the Company utilized its cash flows and borrowing capacity
to fund $62 million in pawn receivable and inventory growth, $48
million in acquisitions and $26 million for capital expenditures
(primarily for new stores) and purchases of store real estate.
- The Board of
Directors declared a $0.30 per share third quarter cash dividend on
common shares outstanding, which will be paid on August 27,
2021 to stockholders of record as of August 13, 2021. This
represents an annualized dividend of $1.20 per share. Any future
dividends are subject to approval by the Company’s Board of
Directors.
- The Company
repurchased 452,000 shares of common stock during the second
quarter at an aggregate cost of $33 million and an average cost per
share of $73.06. For the six months ended June 30, 2021, the
Company repurchased 536,000 shares of common stock at an aggregate
cost of $38 million and an average cost per share of $70.87. The
Company had $84 million remaining under its current share
repurchase authorization at quarter end. Future share repurchases
are subject to expected liquidity, acquisition opportunities, debt
covenant restrictions and other relevant factors.
2021 Outlook
Given the continued uncertainties related to
COVID-19 and, in particular, the associated government assistance
programs, the Company is not currently providing earnings guidance.
However, the following factors are expected to impact operating
trends in 2021:
- Impacts of
COVID-19: The extent to which COVID-19 continues to impact the
Company’s operations will depend on future developments, which
remain uncertain and cannot be predicted with confidence. This
uncertainty includes the pace of the economic recovery in the
markets in which we serve and the impact of future governmental
responses, most notably the monthly advance payment of federal
child tax credits that began in mid-July in the U.S.
- Pawn loan
origination activity continues to improve, with U.S. same-store new
loan volumes thus far in July down only 10% compared to 2019
originations. While U.S. same-store pawn balances are currently up
28% at July 20, 2021 compared to the prior year, they are still
down 23% compared to the same date in 2019. Accordingly, same-store
pawn fees in the third quarter will continue to be below normalized
levels. The Company cannot currently predict the impact, if any, of
the monthly advance payments of the federal child tax credit which
began in mid-July 2021.
- In Mexico, which comprises the majority
of the Company’s Latin American operations and where there have
been minimal stimulus programs, same-store pawn loans are currently
34% above prior-year levels and only 4% below this date in
2019.
- Income tax rate:
For the full year of 2021, the effective income tax rate, under
current tax codes in the U.S. and Latin America, is expected to
range from 26.5% to 27.5% compared to 25.8% in 2020.
- New store openings:
Through June, the Company has opened 36 new stores and the Company
continues to expect 50 to 60 new store openings for the full year
2021.
Additional Commentary and
Analysis
Mr. Wessel provided the following additional
insights on the Company’s second quarter and year-to-date operating
results:
“We are very encouraged by the current trends,
most notably the improved lending demand and the continuation of
strong retail metrics. Even though revenues are still recovering,
we posted year-to-date segment operating profit margins of 20% or
more in both the U.S. and Latin America. These first half results,
coupled with anticipated further growth in pawn receivables and
revenues and continued expense discipline, position us well for
earnings growth in the back half of 2021.
“Looking further at the U.S. segment results, as
we began the second quarter, loan demand was under pressure with
two rounds of stimulus and tax refunds being paid out in the first
quarter. The recovery in lending demand we experienced in the
second quarter appears to be driven by the further reopening of the
economy, waning stimulus programs and consumer price inflation.
More importantly, lending originations in the U.S. have continued
to improve in July and are now nearing normalized 2019 levels. The
major unknown at this point will be the potential impact, if any,
of advance payments of the federal child tax credits which began in
mid-July. Retail sales remained solid during the quarter and
despite the declining impact of stimulus, retail margins through
June remained at record levels.
“In Latin America, and Mexico in particular, the
impact of COVID-19 on 2020 lending volumes was less severe and
recovered more quickly due to limited governmental support
programs. Resulting lending activity in the second quarter
essentially recovered to pre-pandemic levels and retail results
were boosted by improved retail margins. As in the U.S., we have
reduced ongoing same-store store operating expenses from 2019
levels in our Latin American markets through a combination of
optimized staffing levels and technology initiatives.
“Looking ahead, we expect additional revenue and
earnings growth through continued store expansion initiatives. The
28 stores acquired in Texas this year are primarily in rapidly
growing markets surrounding Houston and San Antonio. The purchase
price for these acquisitions was in line with our historical
valuation metrics and we believe that these acquired stores will be
immediately accretive to earnings. Coupled with the 36 new, or de
novo, stores opened this year, we have added a total of 64
locations year-to-date. Combined with the 137 store additions in
2020, we have now added 201 locations in the past 18 months. We
remain on target to open 50 to 60 de novo locations in 2021 and
continue to see opportunities for additional acquisitions.
“Finally, we remain committed to further drive
shareholder value through our dividend and stock repurchase
programs. The quarterly cash dividend was raised to $0.30 per share
in the second quarter and the Board again declared a $0.30 cash
dividend for the third quarter. We also continued our stock
repurchase program in the second quarter with $33 million of total
repurchases as we completed the previous $100 million share
repurchase program and initiated purchases under the new January
2021 $100 million repurchase program.
“We believe there are significant growth
opportunities ahead that will continue to be driven by de novo
store openings and strategic acquisitions. Combined with our focus
on margin improvements and expense management, we believe that we
can further increase earnings and enhance shareholder value,”
concluded Mr. Wessel.
About FirstCash
FirstCash is the leading international operator
of pawn stores with over 2,800 retail pawn locations and 16,000
employees in 24 U.S. states, the District of Columbia and four
countries in Latin America including Mexico, Guatemala, Colombia
and El Salvador. FirstCash focuses on serving cash and credit
constrained consumers through its retail pawn locations, which buy
and sell a wide variety of jewelry, electronics, tools, appliances,
sporting goods, musical instruments and other merchandise, and make
small consumer pawn loans secured by pledged personal property.
FirstCash is a component company in both the
Standard & Poor’s MidCap 400 Index® and the
Russell 2000 Index®. FirstCash’s common stock
(ticker symbol “FCFS”) is traded on the Nasdaq,
the creator of the world’s first electronic stock market. For
additional information regarding FirstCash and the services it
provides, visit FirstCash’s website located at
http://www.firstcash.com.
Forward-Looking
Information
This release contains forward-looking statements
about the business, financial condition and prospects of FirstCash,
Inc. and its wholly owned subsidiaries (together, the “Company”).
Forward-looking statements, as that term is defined in the Private
Securities Litigation Reform Act of 1995, can be identified by the
use of forward-looking terminology such as “outlook,” “believes,”
“projects,” “expects,” “may,” “estimates,” “should,” “plans,”
“targets,” “intends,” “could,” “would,” “anticipates,” “potential,”
“confident,” “optimistic,” or the negative thereof, or other
variations thereon, or comparable terminology, or by discussions of
strategy, objectives, estimates, guidance, expectations and future
plans. Forward-looking statements can also be identified by the
fact these statements do not relate strictly to historical or
current matters. Rather, forward-looking statements relate to
anticipated or expected events, activities, trends or results.
Because forward-looking statements relate to matters that have not
yet occurred, these statements are inherently subject to risks and
uncertainties.
While the Company believes the expectations
reflected in forward-looking statements are reasonable, there can
be no assurances such expectations will prove to be accurate.
Security holders are cautioned such forward-looking statements
involve risks and uncertainties. Certain factors may cause results
to differ materially from those anticipated by the forward-looking
statements made in this release. Such factors may include, without
limitation, the risks, uncertainties and regulatory developments:
(1) related to the COVID-19 pandemic, including the unknown
duration and severity of the COVID-19 pandemic, which may be
impacted by variants of the COVID-19 virus and the timing,
availability and efficacy of the COVID-19 vaccines in the
jurisdictions in which the Company operates, the impact of
governmental responses that have been, and may in the future be,
imposed in response to the pandemic, including stimulus programs
which could adversely impact lending demand and regulations which
could adversely affect the Company’s ability to continue to fully
operate, potential changes in consumer behavior and shopping
patterns which could impact demand for both the Company’s pawn loan
and retail products, changes in the economic conditions in the
United States and Latin America, which potentially could have an
impact on discretionary consumer spending or impact demand for pawn
loan products, and currency fluctuations, primarily involving the
Mexican peso, and (2) discussed and described in the Company’s most
recent Annual Report on Form 10-K filed with the Securities and
Exchange Commission (the “SEC”), including the risks described in
Part 1, Item 1A, “Risk Factors” thereof, and in the other reports
filed subsequently by the Company with the SEC. Many of these risks
and uncertainties are beyond the ability of the Company to control,
nor can the Company predict, in many cases, all of the risks and
uncertainties that could cause its actual results to differ
materially from those indicated by the forward-looking statements.
The forward-looking statements contained in this release speak only
as of the date of this release, and the Company expressly disclaims
any obligation or undertaking to report any updates or revisions to
any such statement to reflect any change in the Company’s
expectations or any change in events, conditions or circumstances
on which any such statement is based, except as required by
law.
FIRSTCASH,
INC.CONSOLIDATED STATEMENTS OF
INCOME(unaudited, in thousands, except per share
amounts)
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Revenue: |
|
|
|
|
|
|
|
|
Retail merchandise sales |
|
$ |
265,567 |
|
|
|
$ |
287,400 |
|
|
|
$ |
537,609 |
|
|
|
$ |
584,029 |
|
|
Pawn loan fees |
|
109,909 |
|
|
|
101,990 |
|
|
|
225,431 |
|
|
|
244,105 |
|
|
Wholesale scrap jewelry sales |
|
14,102 |
|
|
|
22,785 |
|
|
|
34,477 |
|
|
|
49,156 |
|
|
Consumer loan and credit services fees |
|
— |
|
|
|
571 |
|
|
|
— |
|
|
|
1,946 |
|
|
Total revenue |
|
389,578 |
|
|
|
412,746 |
|
|
|
797,517 |
|
|
|
879,236 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
Cost of retail merchandise sold |
|
153,424 |
|
|
|
171,511 |
|
|
|
310,577 |
|
|
|
356,206 |
|
|
Cost of wholesale scrap jewelry sold |
|
11,932 |
|
|
|
18,357 |
|
|
|
29,129 |
|
|
|
41,204 |
|
|
Consumer loan and credit services loss provision |
|
— |
|
|
|
(223 |
) |
|
|
— |
|
|
|
(584 |
) |
|
Total cost of revenue |
|
165,356 |
|
|
|
189,645 |
|
|
|
339,706 |
|
|
|
396,826 |
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
224,222 |
|
|
|
223,101 |
|
|
|
457,811 |
|
|
|
482,410 |
|
|
|
|
|
|
|
|
|
|
|
Expenses and other
income: |
|
|
|
|
|
|
|
|
Store operating expenses |
|
139,128 |
|
|
|
141,051 |
|
|
|
276,452 |
|
|
|
294,551 |
|
|
Administrative expenses |
|
27,398 |
|
|
|
28,386 |
|
|
|
58,397 |
|
|
|
61,288 |
|
|
Depreciation and amortization |
|
10,902 |
|
|
|
10,324 |
|
|
|
21,514 |
|
|
|
20,998 |
|
|
Interest expense |
|
7,198 |
|
|
|
6,974 |
|
|
|
14,428 |
|
|
|
15,392 |
|
|
Interest income |
|
(119 |
) |
|
|
(525 |
) |
|
|
(277 |
) |
|
|
(710 |
) |
|
Merger and acquisition expenses |
|
1,086 |
|
|
|
134 |
|
|
|
1,252 |
|
|
|
202 |
|
|
(Gain) loss on foreign exchange |
|
(577 |
) |
|
|
(614 |
) |
|
|
(310 |
) |
|
|
2,071 |
|
|
Write-off of certain Cash America merger related lease
intangibles |
|
401 |
|
|
|
182 |
|
|
|
1,279 |
|
|
|
3,812 |
|
|
Impairment of certain other assets |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,900 |
|
|
Total expenses and other income |
|
185,417 |
|
|
|
185,912 |
|
|
|
372,735 |
|
|
|
399,504 |
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
38,805 |
|
|
|
37,189 |
|
|
|
85,076 |
|
|
|
82,906 |
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
10,378 |
|
|
|
11,316 |
|
|
|
22,934 |
|
|
|
24,115 |
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
28,427 |
|
|
|
$ |
25,873 |
|
|
|
$ |
62,142 |
|
|
|
$ |
58,791 |
|
|
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.70 |
|
|
|
$ |
0.62 |
|
|
|
$ |
1.52 |
|
|
|
$ |
1.41 |
|
|
Diluted |
|
$ |
0.70 |
|
|
|
$ |
0.62 |
|
|
|
$ |
1.52 |
|
|
|
$ |
1.41 |
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
40,754 |
|
|
|
41,440 |
|
|
|
40,893 |
|
|
|
41,676 |
|
|
Diluted |
|
40,802 |
|
|
|
41,531 |
|
|
|
40,929 |
|
|
|
41,769 |
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per common
share |
|
$ |
0.30 |
|
|
|
$ |
0.27 |
|
|
|
$ |
0.57 |
|
|
|
$ |
0.54 |
|
|
Certain amounts in the consolidated statements
of income for the six months ended June 30, 2020 have been
reclassified in order to conform to the 2021 presentation.
FIRSTCASH,
INC.CONSOLIDATED BALANCE
SHEETS(unaudited, in thousands)
|
|
June 30, |
|
December 31, |
|
|
2021 |
|
2020 |
|
2020 |
ASSETS |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
50,061 |
|
|
|
$ |
70,956 |
|
|
|
$ |
65,850 |
|
|
Fees and service charges
receivable |
|
40,183 |
|
|
|
30,418 |
|
|
|
41,110 |
|
|
Pawn loans |
|
312,166 |
|
|
|
230,383 |
|
|
|
308,231 |
|
|
Inventories |
|
216,955 |
|
|
|
179,967 |
|
|
|
190,352 |
|
|
Income taxes receivable |
|
7,324 |
|
|
|
4,988 |
|
|
|
9,634 |
|
|
Prepaid expenses and other
current assets |
|
11,698 |
|
|
|
10,865 |
|
|
|
9,388 |
|
|
Total current assets |
|
638,387 |
|
|
|
527,577 |
|
|
|
624,565 |
|
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
404,283 |
|
|
|
341,114 |
|
|
|
373,667 |
|
|
Operating lease right of use
asset |
|
299,223 |
|
|
|
283,063 |
|
|
|
298,957 |
|
|
Goodwill |
|
1,017,273 |
|
|
|
929,575 |
|
|
|
977,381 |
|
|
Intangible assets, net |
|
83,372 |
|
|
|
84,389 |
|
|
|
83,651 |
|
|
Other assets |
|
9,406 |
|
|
|
9,037 |
|
|
|
9,818 |
|
|
Deferred tax assets |
|
4,489 |
|
|
|
7,764 |
|
|
|
4,158 |
|
|
Total assets |
|
$ |
2,456,433 |
|
|
|
$ |
2,182,519 |
|
|
|
$ |
2,372,197 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
Accounts payable and accrued
liabilities |
|
$ |
103,331 |
|
|
|
$ |
69,810 |
|
|
|
$ |
81,917 |
|
|
Customer deposits |
|
44,486 |
|
|
|
35,439 |
|
|
|
34,719 |
|
|
Income taxes payable |
|
369 |
|
|
|
13,230 |
|
|
|
1,148 |
|
|
Lease liability, current |
|
89,027 |
|
|
|
83,580 |
|
|
|
88,622 |
|
|
Total current liabilities |
|
237,213 |
|
|
|
202,059 |
|
|
|
206,406 |
|
|
|
|
|
|
|
|
|
Revolving unsecured credit
facilities |
|
163,000 |
|
|
|
200,000 |
|
|
|
123,000 |
|
|
Senior unsecured notes |
|
493,303 |
|
|
|
296,923 |
|
|
|
492,916 |
|
|
Deferred tax liabilities |
|
75,912 |
|
|
|
67,842 |
|
|
|
71,173 |
|
|
Lease liability,
non-current |
|
196,189 |
|
|
|
182,915 |
|
|
|
194,887 |
|
|
Total liabilities |
|
1,165,617 |
|
|
|
949,739 |
|
|
|
1,088,382 |
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
Common stock |
|
493 |
|
|
|
493 |
|
|
|
493 |
|
|
Additional paid-in capital |
|
1,219,948 |
|
|
|
1,226,512 |
|
|
|
1,221,788 |
|
|
Retained earnings |
|
828,040 |
|
|
|
763,810 |
|
|
|
789,303 |
|
|
Accumulated other comprehensive loss |
|
(115,790 |
) |
|
|
(172,150 |
) |
|
|
(118,432 |
) |
|
Common stock held in treasury, at cost |
|
(641,875 |
) |
|
|
(585,885 |
) |
|
|
(609,337 |
) |
|
Total stockholders’ equity |
|
1,290,816 |
|
|
|
1,232,780 |
|
|
|
1,283,815 |
|
|
Total liabilities and stockholders’ equity |
|
$ |
2,456,433 |
|
|
|
$ |
2,182,519 |
|
|
|
$ |
2,372,197 |
|
|
Certain amounts in the consolidated balance
sheets as of June 30, 2020 have been reclassified in order to
conform to the 2021 presentation.
FIRSTCASH, INC.OPERATING
INFORMATION(UNAUDITED)
The Company’s reportable segments are as
follows:
- U.S.
operations
- Latin America operations - includes
operations in Mexico, Guatemala, Colombia and El Salvador
The Company provides revenues, cost of revenues,
store operating expenses, pre-tax operating income and earning
assets by segment. Store operating expenses include salary and
benefit expense of store-level employees, occupancy costs, bank
charges, security, insurance, utilities, supplies and other costs
incurred by the stores.
U.S. Operations Segment Results
The following table details earning assets,
which consist of pawn loans and inventories, as well as other
earning asset metrics of the U.S. operations segment as of
June 30, 2021 as compared to June 30, 2020 (dollars in
thousands, except as otherwise noted):
|
As of June 30, |
|
|
|
2021 |
|
2020 |
|
Increase |
U.S. Operations
Segment |
|
|
|
|
|
|
|
|
|
Earning assets: |
|
|
|
|
|
|
|
|
|
Pawn loans |
$ |
203,838 |
|
|
$ |
158,253 |
|
|
|
29 |
% |
|
Inventories |
|
144,083 |
|
|
|
120,408 |
|
|
|
20 |
% |
|
|
$ |
347,921 |
|
|
$ |
278,661 |
|
|
|
25 |
% |
|
|
|
|
|
|
|
|
|
|
|
Average outstanding pawn loan
amount (in ones) |
$ |
209 |
|
|
$ |
190 |
|
|
|
10 |
% |
|
|
|
|
|
|
|
|
|
|
|
Composition of pawn
collateral: |
|
|
|
|
|
|
|
|
|
General merchandise |
35 |
% |
|
31 |
% |
|
|
|
|
Jewelry |
65 |
% |
|
69 |
% |
|
|
|
|
|
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Composition of
inventories: |
|
|
|
|
|
|
|
|
|
General merchandise |
49 |
% |
|
38 |
% |
|
|
|
|
Jewelry |
51 |
% |
|
62 |
% |
|
|
|
|
|
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of inventory aged
greater than one year |
1 |
% |
|
3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inventory turns (trailing
twelve months cost of merchandise sales divided by average
inventories) |
3.1 times |
|
3.2 times |
|
|
|
|
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
The following table presents segment pre-tax
operating income and other operating metrics of the U.S. operations
segment for the three months ended June 30, 2021 as compared
to the three months ended June 30, 2020 (dollars in
thousands):
|
Three Months Ended |
|
|
|
|
|
June 30, |
|
|
|
2021 |
|
2020 |
|
Decrease |
U.S. Operations
Segment |
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
Retail merchandise sales |
$ |
173,254 |
|
|
$ |
208,944 |
|
|
|
|
(17 |
)% |
|
|
Pawn loan fees |
|
66,942 |
|
|
|
71,900 |
|
|
|
|
(7 |
)% |
|
|
Wholesale scrap jewelry sales |
|
6,846 |
|
|
|
9,557 |
|
|
|
|
(28 |
)% |
|
|
Consumer loan and credit services fees (1) |
|
— |
|
|
|
571 |
|
|
|
|
(100 |
)% |
|
|
Total revenue |
|
247,042 |
|
|
|
290,972 |
|
|
|
|
(15 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
Cost of retail merchandise sold |
|
95,599 |
|
|
|
121,661 |
|
|
|
|
(21 |
)% |
|
|
Cost of wholesale scrap jewelry sold |
|
5,387 |
|
|
|
8,432 |
|
|
|
|
(36 |
)% |
|
|
Consumer loan and credit services loss provision (1) |
|
— |
|
|
|
(223 |
) |
|
|
|
(100 |
)% |
|
|
Total cost of revenue |
|
100,986 |
|
|
|
129,870 |
|
|
|
|
(22 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
146,056 |
|
|
|
161,102 |
|
|
|
|
(9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Segment expenses: |
|
|
|
|
|
|
|
|
|
Store operating expenses |
|
93,574 |
|
|
|
103,302 |
|
|
|
|
(9 |
)% |
|
|
Depreciation and amortization |
|
5,347 |
|
|
|
5,561 |
|
|
|
|
(4 |
)% |
|
|
Total segment expenses |
|
98,921 |
|
|
|
108,863 |
|
|
|
|
(9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating
income |
$ |
47,135 |
|
|
$ |
52,239 |
|
|
|
|
(10 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Operating metrics: |
|
|
|
|
|
|
|
|
|
Retail merchandise sales margin |
45 |
% |
|
42 |
|
% |
|
|
|
|
Wholesale scrap jewelry sales margin |
21 |
% |
|
12 |
|
% |
|
|
|
|
Net revenue margin |
59 |
% |
|
55 |
|
% |
|
|
|
|
Segment pre-tax operating margin |
19 |
% |
|
18 |
|
% |
|
|
|
|
(1) Effective June 30, 2020,
the Company no longer offers an unsecured consumer loan product in
the U.S.
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
The following table presents segment pre-tax
operating income and other operating metrics of the U.S. operations
segment for the six months ended June 30, 2021 as compared to
the six months ended June 30, 2020 (dollars in thousands):
|
Six Months Ended |
|
|
|
|
|
June 30, |
|
|
|
2021 |
|
2020 |
|
Decrease |
U.S. Operations
Segment |
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
Retail merchandise sales |
$ |
363,211 |
|
|
$ |
404,910 |
|
|
|
|
(10 |
)% |
|
|
Pawn loan fees |
|
143,339 |
|
|
|
169,757 |
|
|
|
|
(16 |
)% |
|
|
Wholesale scrap jewelry sales |
|
16,049 |
|
|
|
25,035 |
|
|
|
|
(36 |
)% |
|
|
Consumer loan and credit services fees (1) |
|
— |
|
|
|
1,946 |
|
|
|
|
(100 |
)% |
|
|
Total revenue |
|
522,599 |
|
|
|
601,648 |
|
|
|
|
(13 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
Cost of retail merchandise sold |
|
202,129 |
|
|
|
241,190 |
|
|
|
|
(16 |
)% |
|
|
Cost of wholesale scrap jewelry sold |
|
12,900 |
|
|
|
22,438 |
|
|
|
|
(43 |
)% |
|
|
Consumer loan and credit services loss provision (1) |
|
— |
|
|
|
(584 |
) |
|
|
|
(100 |
)% |
|
|
Total cost of revenue |
|
215,029 |
|
|
|
263,044 |
|
|
|
|
(18 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
307,570 |
|
|
|
338,604 |
|
|
|
|
(9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Segment expenses: |
|
|
|
|
|
|
|
|
|
Store operating expenses |
|
188,821 |
|
|
|
211,008 |
|
|
|
|
(11 |
)% |
|
|
Depreciation and amortization |
|
10,729 |
|
|
|
10,962 |
|
|
|
|
(2 |
)% |
|
|
Total segment expenses |
|
199,550 |
|
|
|
221,970 |
|
|
|
|
(10 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating
income |
$ |
108,020 |
|
|
$ |
116,634 |
|
|
|
|
(7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Operating metrics: |
|
|
|
|
|
|
|
|
|
Retail merchandise sales margin |
44 |
% |
|
40 |
|
% |
|
|
|
|
Wholesale scrap jewelry sales margin |
20 |
% |
|
10 |
|
% |
|
|
|
|
Net revenue margin |
59 |
% |
|
56 |
|
% |
|
|
|
|
Segment pre-tax operating margin |
21 |
% |
|
19 |
|
% |
|
|
|
|
(1) Effective June 30, 2020,
the Company no longer offers an unsecured consumer loan product in
the U.S.
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
Latin America Operations Segment
Results
The Company’s management reviews and analyzes
certain operating results in Latin America on a constant currency
basis because the Company believes this better represents the
Company’s underlying business trends. Constant currency results are
non-GAAP financial measures, which exclude the effects of foreign
currency translation and are calculated by translating current-year
results at prior-year average exchange rates. The wholesale scrap
jewelry sales in Latin America are priced and settled in U.S.
dollars, and are not affected by foreign currency translation, as
are a small percentage of the operating and administrative expenses
in Latin America, which are billed and paid in U.S. dollars.
Amounts presented on a constant currency basis are denoted as such.
See the “Constant Currency Results” section below for additional
discussion of constant currency results.
The following table provides exchange rates for
the Mexican peso, Guatemalan quetzal and Colombian peso for the
current and prior-year periods:
|
|
June 30, |
|
|
|
|
2021 |
|
2020 |
|
Favorable |
Mexican peso / U.S. dollar
exchange rate: |
|
|
|
|
|
|
|
|
End-of-period |
|
19.8 |
|
23.0 |
|
|
14 |
% |
|
Three months ended |
|
20.1 |
|
23.4 |
|
|
14 |
% |
|
Six months ended |
|
20.2 |
|
21.6 |
|
|
6 |
% |
|
|
|
|
|
|
|
|
|
|
Guatemalan quetzal / U.S.
dollar exchange rate: |
|
|
|
|
|
|
|
|
End-of-period |
|
7.7 |
|
7.7 |
|
|
— |
% |
|
Three months ended |
|
7.7 |
|
7.7 |
|
|
— |
% |
|
Six months ended |
|
7.7 |
|
7.7 |
|
|
— |
% |
|
|
|
|
|
|
|
|
|
|
Colombian peso / U.S. dollar
exchange rate: |
|
|
|
|
|
|
|
|
End-of-period |
|
3,757 |
|
3,759 |
|
|
— |
% |
|
Three months ended |
|
3,690 |
|
3,846 |
|
|
4 |
% |
|
Six months ended |
|
3,622 |
|
3,689 |
|
|
2 |
% |
|
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
The following table details earning assets,
which consist of pawn loans and inventories, as well as other
earning asset metrics of the Latin America operations segment as of
June 30, 2021 as compared to June 30, 2020 (dollars in
thousands, except as otherwise noted):
|
|
|
|
|
|
|
|
|
|
|
Constant Currency Basis |
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
As of June 30, |
|
|
|
2021 |
|
Increase |
|
2021 |
|
2020 |
|
Increase |
|
(Non-GAAP) |
|
(Non-GAAP) |
Latin America
Operations Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pawn loans |
$ |
108,328 |
|
|
$ |
72,130 |
|
|
|
50 |
% |
|
|
$ |
94,098 |
|
|
|
30 |
% |
|
Inventories |
|
72,872 |
|
|
|
59,559 |
|
|
|
22 |
% |
|
|
63,300 |
|
|
|
6 |
% |
|
|
$ |
181,200 |
|
|
$ |
131,689 |
|
|
|
38 |
% |
|
|
$ |
157,398 |
|
|
|
20 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average outstanding pawn loan
amount (in ones) |
$ |
80 |
|
|
$ |
59 |
|
|
|
36 |
% |
|
|
$ |
69 |
|
|
|
17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Composition of pawn
collateral: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General merchandise |
67 |
% |
|
66 |
% |
|
|
|
|
|
|
|
|
|
|
Jewelry |
33 |
% |
|
34 |
% |
|
|
|
|
|
|
|
|
|
|
|
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Composition of
inventories: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General merchandise |
64 |
% |
|
61 |
% |
|
|
|
|
|
|
|
|
|
|
Jewelry |
36 |
% |
|
39 |
% |
|
|
|
|
|
|
|
|
|
|
|
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of inventory aged
greater than one year |
1 |
% |
|
2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inventory turns (trailing
twelve months cost of merchandise sales divided by average
inventories) |
4.4 times |
|
3.9 times |
|
|
|
|
|
|
|
|
|
|
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
The following table presents segment pre-tax
operating income and other operating metrics of the Latin America
operations segment for the three months ended June 30, 2021 as
compared to the three months ended June 30, 2020 (dollars in
thousands):
|
|
|
|
|
|
|
|
|
|
Constant Currency Basis |
|
|
|
|
|
|
|
|
|
|
|
Three Months |
|
|
|
|
|
|
|
|
|
|
|
Ended |
|
|
|
|
|
Three Months Ended |
|
|
|
|
|
June 30, |
|
Increase / |
|
|
June 30, |
|
Increase / |
|
|
2021 |
|
(Decrease) |
|
|
2021 |
|
|
2020 |
|
(Decrease) |
|
|
(Non-GAAP) |
|
(Non-GAAP) |
|
Latin America
Operations Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail merchandise sales |
$ |
92,313 |
|
|
|
$ |
78,456 |
|
|
|
18 |
% |
|
|
$ |
79,905 |
|
|
|
2 |
% |
|
Pawn loan fees |
42,967 |
|
|
|
30,090 |
|
|
|
43 |
% |
|
|
37,175 |
|
|
|
24 |
% |
|
Wholesale scrap jewelry sales |
7,256 |
|
|
|
13,228 |
|
|
|
(45 |
)% |
|
|
7,256 |
|
|
|
(45 |
)% |
|
Total revenue |
142,536 |
|
|
|
121,774 |
|
|
|
17 |
% |
|
|
124,336 |
|
|
|
2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of retail merchandise sold |
57,825 |
|
|
|
49,850 |
|
|
|
16 |
% |
|
|
50,076 |
|
|
|
— |
% |
|
Cost of wholesale scrap jewelry sold |
6,545 |
|
|
|
9,925 |
|
|
|
(34 |
)% |
|
|
5,645 |
|
|
|
(43 |
)% |
|
Total cost of revenue |
64,370 |
|
|
|
59,775 |
|
|
|
8 |
% |
|
|
55,721 |
|
|
|
(7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
78,166 |
|
|
|
61,999 |
|
|
|
26 |
% |
|
|
68,615 |
|
|
|
11 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Store operating expenses |
45,554 |
|
|
|
37,749 |
|
|
|
21 |
% |
|
|
39,793 |
|
|
|
5 |
% |
|
Depreciation and amortization |
4,534 |
|
|
|
3,602 |
|
|
|
26 |
% |
|
|
3,995 |
|
|
|
11 |
% |
|
Total segment expenses |
50,088 |
|
|
|
41,351 |
|
|
|
21 |
% |
|
|
43,788 |
|
|
|
6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating
income |
$ |
28,078 |
|
|
|
$ |
20,648 |
|
|
|
36 |
% |
|
|
$ |
24,827 |
|
|
|
20 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail merchandise sales margin |
37 |
% |
|
36 |
% |
|
|
|
|
37 |
% |
|
|
|
|
Wholesale scrap jewelry sales margin |
10 |
% |
|
25 |
% |
|
|
|
|
22 |
% |
|
|
|
|
Net revenue margin |
55 |
% |
|
51 |
% |
|
|
|
|
55 |
% |
|
|
|
|
Segment pre-tax operating margin |
20 |
% |
|
17 |
% |
|
|
|
|
20 |
% |
|
|
|
|
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
The following table presents segment pre-tax
operating income and other operating metrics of the Latin America
operations segment for the six months ended June 30, 2021 as
compared to the six months ended June 30, 2020 (dollars in
thousands):
|
|
|
|
|
|
|
|
|
|
Constant Currency Basis |
|
|
|
|
|
|
|
|
|
|
|
Six Months |
|
|
|
|
|
|
|
|
|
|
|
Ended |
|
|
|
|
|
Six Months Ended |
|
|
|
|
|
June 30, |
|
Increase / |
|
|
June 30, |
|
Increase / |
|
|
2021 |
|
(Decrease) |
|
|
2021 |
|
|
2020 |
|
(Decrease) |
|
|
(Non-GAAP) |
|
(Non-GAAP) |
|
Latin America
Operations Segment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail merchandise sales |
$ |
174,398 |
|
|
|
$ |
179,119 |
|
|
|
(3 |
)% |
|
|
|
$ |
163,529 |
|
|
|
(9 |
)% |
|
Pawn loan fees |
82,092 |
|
|
|
74,348 |
|
|
|
10 |
% |
|
|
|
76,951 |
|
|
|
4 |
% |
|
Wholesale scrap jewelry sales |
18,428 |
|
|
|
24,121 |
|
|
|
(24 |
)% |
|
|
|
18,428 |
|
|
|
(24 |
)% |
|
Total revenue |
274,918 |
|
|
|
277,588 |
|
|
|
(1 |
)% |
|
|
|
258,908 |
|
|
|
(7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of retail merchandise sold |
108,448 |
|
|
|
115,016 |
|
|
|
(6 |
)% |
|
|
|
101,709 |
|
|
|
(12 |
)% |
|
Cost of wholesale scrap jewelry sold |
16,229 |
|
|
|
18,766 |
|
|
|
(14 |
)% |
|
|
|
15,210 |
|
|
|
(19 |
)% |
|
Total cost of revenue |
124,677 |
|
|
|
133,782 |
|
|
|
(7 |
)% |
|
|
|
116,919 |
|
|
|
(13 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
150,241 |
|
|
|
143,806 |
|
|
|
4 |
% |
|
|
|
141,989 |
|
|
|
(1 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Store operating expenses |
87,631 |
|
|
|
83,543 |
|
|
|
5 |
% |
|
|
|
82,513 |
|
|
|
(1 |
)% |
|
Depreciation and amortization |
8,797 |
|
|
|
7,665 |
|
|
|
15 |
% |
|
|
|
8,310 |
|
|
|
8 |
% |
|
Total segment expenses |
96,428 |
|
|
|
91,208 |
|
|
|
6 |
% |
|
|
|
90,823 |
|
|
|
— |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating
income |
$ |
53,813 |
|
|
|
$ |
52,598 |
|
|
|
2 |
% |
|
|
|
$ |
51,166 |
|
|
|
(3 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail merchandise sales margin |
38 |
% |
|
36 |
% |
|
|
|
|
38 |
% |
|
|
|
|
Wholesale scrap jewelry sales margin |
12 |
% |
|
22 |
% |
|
|
|
|
17 |
% |
|
|
|
|
Net revenue margin |
55 |
% |
|
52 |
% |
|
|
|
|
55 |
% |
|
|
|
|
Segment pre-tax operating margin |
20 |
% |
|
19 |
% |
|
|
|
|
20 |
% |
|
|
|
|
FIRSTCASH, INC.OPERATING
INFORMATION (CONTINUED)(UNAUDITED)
Consolidated Results of Operations
The following table reconciles pre-tax operating
income of the Company’s U.S. operations segment and Latin America
operations segment discussed above to consolidated net income (in
thousands):
|
Three Months Ended |
|
Six Months Ended |
|
June 30, |
|
June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Consolidated Results
of Operations |
|
|
|
|
|
|
|
Segment pre-tax operating
income: |
|
|
|
|
|
|
|
U.S. operations |
$ |
47,135 |
|
|
|
$ |
52,239 |
|
|
|
$ |
108,020 |
|
|
|
$ |
116,634 |
|
|
Latin America operations |
28,078 |
|
|
|
20,648 |
|
|
|
53,813 |
|
|
|
52,598 |
|
|
Consolidated segment pre-tax operating income |
75,213 |
|
|
|
72,887 |
|
|
|
161,833 |
|
|
|
169,232 |
|
|
|
|
|
|
|
|
|
|
Corporate expenses and other
income: |
|
|
|
|
|
|
|
Administrative expenses |
27,398 |
|
|
|
28,386 |
|
|
|
58,397 |
|
|
|
61,288 |
|
|
Depreciation and amortization |
1,021 |
|
|
|
1,161 |
|
|
|
1,988 |
|
|
|
2,371 |
|
|
Interest expense |
7,198 |
|
|
|
6,974 |
|
|
|
14,428 |
|
|
|
15,392 |
|
|
Interest income |
(119 |
) |
|
|
(525 |
) |
|
|
(277 |
) |
|
|
(710 |
) |
|
Merger and acquisition expenses |
1,086 |
|
|
|
134 |
|
|
|
1,252 |
|
|
|
202 |
|
|
(Gain) loss on foreign exchange |
(577 |
) |
|
|
(614 |
) |
|
|
(310 |
) |
|
|
2,071 |
|
|
Write-off of certain Cash America merger related lease
intangibles |
401 |
|
|
|
182 |
|
|
|
1,279 |
|
|
|
3,812 |
|
|
Impairment of certain other assets |
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,900 |
|
|
Total corporate expenses and other income |
36,408 |
|
|
|
35,698 |
|
|
|
76,757 |
|
|
|
86,326 |
|
|
|
|
|
|
|
|
|
|
Income before income
taxes |
38,805 |
|
|
|
37,189 |
|
|
|
85,076 |
|
|
|
82,906 |
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
10,378 |
|
|
|
11,316 |
|
|
|
22,934 |
|
|
|
24,115 |
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
28,427 |
|
|
|
$ |
25,873 |
|
|
|
$ |
62,142 |
|
|
|
$ |
58,791 |
|
|
FIRSTCASH, INC.STORE
COUNT ACTIVITY
The following tables detail store count
activity:
|
|
Three Months Ended June 30, 2021 |
|
|
U.S. |
|
Latin America |
|
|
|
|
Operations Segment |
|
Operations Segment |
|
Total Locations |
Total locations, beginning of period |
|
1,046 |
|
|
|
1,725 |
|
|
|
2,771 |
|
|
New locations opened |
|
1 |
|
|
|
11 |
|
|
|
12 |
|
|
Locations acquired |
|
26 |
|
|
|
— |
|
|
|
26 |
|
|
Consolidation of existing pawn locations (1) |
|
(2 |
) |
|
|
(3 |
) |
|
|
(5 |
) |
|
Total locations, end of period |
|
1,071 |
|
|
|
1,733 |
|
|
|
2,804 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2021 |
|
|
U.S. |
|
Latin America |
|
|
|
|
Operations Segment |
|
Operations Segment |
|
Total Locations |
Total locations, beginning of
period |
|
1,046 |
|
|
|
1,702 |
|
|
|
2,748 |
|
|
New locations opened |
|
1 |
|
|
|
35 |
|
|
|
36 |
|
|
Locations acquired |
|
28 |
|
|
|
— |
|
|
|
28 |
|
|
Consolidation of existing pawn locations (1) |
|
(4 |
) |
|
|
(4 |
) |
|
|
(8 |
) |
|
Total locations, end of period |
|
1,071 |
|
|
|
1,733 |
|
|
|
2,804 |
|
|
(1) Store consolidations were
primarily acquired locations over the past four years which have
been combined with overlapping stores and for which the Company
expects to maintain a significant portion of the acquired customer
base in the consolidated location.
FIRSTCASH,
INC.RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURESTO GAAP FINANCIAL
MEASURES(UNAUDITED)
The Company uses certain financial calculations
such as adjusted net income, adjusted diluted earnings per share,
EBITDA, adjusted EBITDA, free cash flow, adjusted free cash flow
and constant currency results as factors in the measurement and
evaluation of the Company’s operating performance and
period-over-period growth. The Company derives these financial
calculations on the basis of methodologies other than generally
accepted accounting principles (“GAAP”), primarily by excluding
from a comparable GAAP measure certain items the Company does not
consider to be representative of its actual operating performance.
These financial calculations are “non-GAAP financial measures” as
defined under the SEC rules. The Company uses these non-GAAP
financial measures in operating its business because management
believes they are less susceptible to variances in actual operating
performance that can result from the excluded items, other
infrequent charges and currency fluctuations. The Company presents
these financial measures to investors because management believes
they are useful to investors in evaluating the primary factors that
drive the Company’s core operating performance and provide greater
transparency into the Company’s results of operations. However,
items that are excluded and other adjustments and assumptions that
are made in calculating these non-GAAP financial measures are
significant components in understanding and assessing the Company’s
financial performance. These non-GAAP financial measures should be
evaluated in conjunction with, and are not a substitute for, the
Company’s GAAP financial measures. Further, because these non-GAAP
financial measures are not determined in accordance with GAAP and
are thus susceptible to varying calculations, the non-GAAP
financial measures, as presented, may not be comparable to other
similarly titled measures of other companies.
While acquisitions are an important part of the
Company’s overall strategy, the Company has adjusted the applicable
financial calculations to exclude merger and acquisition expenses
to allow more accurate comparisons of the financial results to
prior periods. In addition, the Company does not consider these
merger and acquisition expenses to be related to the organic
operations of the acquired businesses or its continuing operations
and such expenses are generally not relevant to assessing or
estimating the long-term performance of the acquired businesses.
Merger and acquisition expenses include incremental costs directly
associated with merger and acquisition activities, including
professional fees, legal expenses, severance, retention and other
employee-related costs, contract breakage costs and costs related
to the consolidation of technology systems and corporate
facilities, among others.
The Company has certain leases in Mexico which
are denominated in U.S. dollars. The lease liability of these U.S.
dollar denominated leases, which is considered a monetary
liability, is remeasured into Mexican pesos using current period
exchange rates resulting in the recognition of foreign currency
exchange gains or losses. The Company has adjusted the applicable
financial measures to exclude these remeasurement gains or losses
because they are non-cash, non-operating items that could create
volatility in the Company’s consolidated results of operations due
to the magnitude of the end of period lease liability being
remeasured and to improve comparability of current periods
presented with prior periods.
In conjunction with the Cash America merger in
2016, the Company recorded certain lease intangibles related to
above or below market lease liabilities of Cash America which are
included in the operating lease right of use asset on the
consolidated balance sheets. As the Company continues to
opportunistically purchase real estate from landlords at certain
Cash America stores, the associated lease intangible, if any, is
written-off and gain or loss is recognized. The Company has
adjusted the applicable financial measures to exclude these gains
or losses given the variability in size and timing of these
transactions and because they are non-cash, non-operating gains or
losses. The Company believes this improves comparability of
operating results for current periods presented with prior
periods.
FIRSTCASH,
INC.RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURESTO GAAP FINANCIAL MEASURES
(CONTINUED)(UNAUDITED)
Adjusted Net Income and Adjusted Diluted
Earnings Per Share
Management believes the presentation of adjusted
net income and adjusted diluted earnings per share provides
investors with greater transparency and provides a more complete
understanding of the Company’s financial performance and prospects
for the future by excluding items that management believes are
non-operating in nature and not representative of the Company’s
core operating performance of its continuing operations. In
addition, management believes the adjustments shown below are
useful to investors in order to allow them to compare the Company’s
financial results for the current periods presented with the prior
periods presented.
The following table provides a reconciliation
between net income and diluted earnings per share calculated in
accordance with GAAP to adjusted net income and adjusted diluted
earnings per share, which are shown net of tax (in thousands,
except per share amounts):
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
InThousands |
|
PerShare |
|
InThousands |
|
PerShare |
|
InThousands |
|
PerShare |
|
InThousands |
|
PerShare |
Net income and diluted earnings per share, as reported |
$ |
28,427 |
|
|
$ |
0.70 |
|
|
$ |
25,873 |
|
|
$ |
0.62 |
|
|
$ |
62,142 |
|
|
$ |
1.52 |
|
|
$ |
58,791 |
|
|
$ |
1.41 |
|
Adjustments, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Merger and acquisition expenses |
826 |
|
|
0.02 |
|
|
96 |
|
|
— |
|
|
942 |
|
|
0.02 |
|
|
146 |
|
|
— |
|
Non-cash foreign currency (gain) loss related to lease
liability |
(524 |
) |
|
(0.02 |
) |
|
(308 |
) |
|
— |
|
|
(103 |
) |
|
— |
|
|
2,761 |
|
|
0.07 |
|
Non-cash write-off of certain Cash America merger related lease
intangibles |
309 |
|
|
0.01 |
|
|
140 |
|
|
— |
|
|
985 |
|
|
0.02 |
|
|
2,935 |
|
|
0.07 |
|
Non-cash impairment of certain other assets (1) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1,463 |
|
|
0.04 |
|
Consumer lending wind-down costs and asset impairments |
— |
|
|
— |
|
|
71 |
|
|
— |
|
|
— |
|
|
— |
|
|
71 |
|
|
— |
|
Adjusted net income and
diluted earnings per share |
$ |
29,038 |
|
|
$ |
0.71 |
|
|
$ |
25,872 |
|
|
$ |
0.62 |
|
|
$ |
63,966 |
|
|
$ |
1.56 |
|
|
$ |
66,167 |
|
|
$ |
1.59 |
|
(1) Impairment related to a
non-operating asset in which the Company determined that an other
than temporary impairment existed as of March 31, 2020.
FIRSTCASH,
INC.RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURESTO GAAP FINANCIAL MEASURES
(CONTINUED)(UNAUDITED)
The following tables provide a reconciliation of
the gross amounts, the impact of income taxes and the net amounts
for the adjustments included in the table above (in thousands):
|
Three Months Ended June 30, |
|
2021 |
|
2020 |
|
Pre-tax |
|
Tax |
|
After-tax |
|
Pre-tax |
|
Tax |
|
After-tax |
Merger and acquisition expenses |
$ |
1,086 |
|
|
|
$ |
260 |
|
|
|
$ |
826 |
|
|
|
$ |
134 |
|
|
|
$ |
38 |
|
|
|
$ |
96 |
|
|
Non-cash foreign currency gain
related to lease liability |
(749 |
) |
|
|
(225 |
) |
|
|
(524 |
) |
|
|
(440 |
) |
|
|
(132 |
) |
|
|
(308 |
) |
|
Non-cash write-off of certain
Cash America merger related lease intangibles |
401 |
|
|
|
92 |
|
|
|
309 |
|
|
|
182 |
|
|
|
42 |
|
|
|
140 |
|
|
Consumer lending wind-down
costs and asset impairments |
— |
|
|
|
— |
|
|
|
— |
|
|
|
92 |
|
|
|
21 |
|
|
|
71 |
|
|
Total adjustments |
$ |
738 |
|
|
|
$ |
127 |
|
|
|
$ |
611 |
|
|
|
$ |
(32 |
) |
|
|
$ |
(31 |
) |
|
|
$ |
(1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
Pre-tax |
|
Tax |
|
After-tax |
|
Pre-tax |
|
Tax |
|
After-tax |
Merger and acquisition
expenses |
$ |
1,252 |
|
|
|
$ |
310 |
|
|
|
$ |
942 |
|
|
|
$ |
202 |
|
|
|
$ |
56 |
|
|
|
$ |
146 |
|
|
Non-cash foreign currency
(gain) loss related to lease liability |
(147 |
) |
|
|
(44 |
) |
|
|
(103 |
) |
|
|
3,944 |
|
|
|
1,183 |
|
|
|
2,761 |
|
|
Non-cash write-off of certain
Cash America merger related lease intangibles |
1,279 |
|
|
|
294 |
|
|
|
985 |
|
|
|
3,812 |
|
|
|
877 |
|
|
|
2,935 |
|
|
Non-cash impairment of certain
other assets |
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,900 |
|
|
|
437 |
|
|
|
1,463 |
|
|
Consumer lending wind-down
costs and asset impairments |
— |
|
|
|
— |
|
|
|
— |
|
|
|
92 |
|
|
|
21 |
|
|
|
71 |
|
|
Total adjustments |
$ |
2,384 |
|
|
|
$ |
560 |
|
|
|
$ |
1,824 |
|
|
|
$ |
9,950 |
|
|
|
$ |
2,574 |
|
|
|
$ |
7,376 |
|
|
FIRSTCASH,
INC.RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURESTO GAAP FINANCIAL MEASURES
(CONTINUED)(UNAUDITED)
Earnings Before Interest, Taxes, Depreciation and
Amortization (EBITDA) and Adjusted EBITDA
The Company defines EBITDA as net income before
income taxes, depreciation and amortization, interest expense and
interest income and adjusted EBITDA as EBITDA adjusted for certain
items as listed below that management considers to be non-operating
in nature and not representative of its actual operating
performance. The Company believes EBITDA and adjusted EBITDA are
commonly used by investors to assess a company’s financial
performance, and adjusted EBITDA is used in the calculation of the
net debt ratio as defined in the Company’s senior unsecured notes
covenants. The following table provides a reconciliation of net
income to EBITDA and adjusted EBITDA (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trailing Twelve |
|
|
Three Months Ended |
|
Six Months Ended |
|
Months Ended |
|
|
June 30, |
|
June 30, |
|
June 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Net income |
|
$ |
28,427 |
|
|
|
$ |
25,873 |
|
|
|
$ |
62,142 |
|
|
|
$ |
58,791 |
|
|
|
$ |
109,930 |
|
|
|
$ |
147,706 |
|
|
Income taxes |
|
|
10,378 |
|
|
|
|
11,316 |
|
|
|
|
22,934 |
|
|
|
|
24,115 |
|
|
|
|
35,939 |
|
|
|
|
55,682 |
|
|
Depreciation and amortization |
|
|
10,902 |
|
|
|
|
10,324 |
|
|
|
|
21,514 |
|
|
|
|
20,998 |
|
|
|
|
42,621 |
|
|
|
|
42,518 |
|
|
Interest expense |
|
|
7,198 |
|
|
|
|
6,974 |
|
|
|
|
14,428 |
|
|
|
|
15,392 |
|
|
|
|
28,380 |
|
|
|
|
32,509 |
|
|
Interest income |
|
|
(119 |
) |
|
|
|
(525 |
) |
|
|
|
(277 |
) |
|
|
|
(710 |
) |
|
|
|
(1,107 |
) |
|
|
|
(1,406 |
) |
|
EBITDA |
|
|
56,786 |
|
|
|
|
53,962 |
|
|
|
|
120,741 |
|
|
|
|
118,586 |
|
|
|
|
215,763 |
|
|
|
|
277,009 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Merger and acquisition expenses |
|
|
1,086 |
|
|
|
|
134 |
|
|
|
|
1,252 |
|
|
|
|
202 |
|
|
|
|
2,366 |
|
|
|
|
1,263 |
|
|
Non-cash foreign currency (gain) loss related to lease
liability |
|
|
(749 |
) |
|
|
|
(440 |
) |
|
|
|
(147 |
) |
|
|
|
3,944 |
|
|
|
|
(2,842 |
) |
|
|
|
3,546 |
|
|
Loss on extinguishment of debt |
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
11,737 |
|
|
|
|
— |
|
|
Non-cash write-off of certain Cash America merger related lease
intangibles |
|
|
401 |
|
|
|
|
182 |
|
|
|
|
1,279 |
|
|
|
|
3,812 |
|
|
|
|
4,522 |
|
|
|
|
3,812 |
|
|
Non-cash impairment of certain other assets |
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
1,900 |
|
|
|
|
— |
|
|
|
|
1,900 |
|
|
Consumer lending wind-down costs and asset impairments |
|
|
— |
|
|
|
|
92 |
|
|
|
|
— |
|
|
|
|
92 |
|
|
|
|
17 |
|
|
|
|
1,002 |
|
|
Adjusted EBITDA |
|
$ |
57,524 |
|
|
|
$ |
53,930 |
|
|
|
$ |
123,125 |
|
|
|
$ |
128,536 |
|
|
|
$ |
231,563 |
|
|
|
$ |
288,532 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net debt ratio
calculation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt (outstanding principal) |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
663,000 |
|
|
|
$ |
500,000 |
|
|
Less: cash and cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(50,061 |
) |
|
|
|
(70,956 |
) |
|
Net debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
612,939 |
|
|
|
$ |
429,044 |
|
|
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
231,563 |
|
|
|
$ |
288,532 |
|
|
Net debt ratio (net debt
divided by adjusted EBITDA) |
|
|
|
|
|
|
|
|
|
|
|
|
|
2.6 |
|
:1 |
|
1.5 |
|
:1 |
FIRSTCASH,
INC.RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURESTO GAAP FINANCIAL MEASURES
(CONTINUED)(UNAUDITED)
Free Cash Flow and Adjusted Free Cash Flow
For purposes of its internal liquidity
assessments, the Company considers free cash flow and adjusted free
cash flow. The Company defines free cash flow as cash flow from
operating activities less purchases of furniture, fixtures,
equipment and improvements and net fundings/repayments of loan
receivables, which are considered to be operating in nature by the
Company but are included in cash flow from investing activities.
Adjusted free cash flow is defined as free cash flow adjusted for
merger and acquisition expenses paid that management considers to
be non-operating in nature.
Free cash flow and adjusted free cash flow are
commonly used by investors as an additional measure of cash
generated by business operations that may be used to repay
scheduled debt maturities and debt service or, following payment of
such debt obligations and other non-discretionary items, may be
available to invest in future growth through new business
development activities or acquisitions, repurchase stock, pay cash
dividends or repay debt obligations prior to their maturities.
These metrics can also be used to evaluate the Company’s ability to
generate cash flow from business operations and the impact that
this cash flow has on the Company’s liquidity. However, free cash
flow and adjusted free cash flow have limitations as analytical
tools and should not be considered in isolation or as a substitute
for cash flow from operating activities or other income statement
data prepared in accordance with GAAP. The following table
reconciles cash flow from operating activities to free cash flow
and adjusted free cash flow (in thousands):
|
|
|
|
|
|
|
|
|
|
Trailing Twelve |
|
|
Three Months Ended |
|
Six Months Ended |
|
Months Ended |
|
|
June 30, |
|
June 30, |
|
June 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Cash flow from operating activities |
|
$ |
44,575 |
|
|
|
$ |
65,914 |
|
|
|
$ |
113,749 |
|
|
|
$ |
143,299 |
|
|
|
$ |
192,714 |
|
|
|
$ |
268,922 |
|
|
Cash flow from investing
activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Loan receivables, net (1) |
|
(50,886 |
) |
|
|
126,000 |
|
|
|
(8,492 |
) |
|
|
178,279 |
|
|
|
(79,763 |
) |
|
|
193,111 |
|
|
Purchases of furniture, fixtures, equipment and improvements |
|
(11,534 |
) |
|
|
(9,895 |
) |
|
|
(21,025 |
) |
|
|
(20,476 |
) |
|
|
(38,092 |
) |
|
|
(41,883 |
) |
|
Free cash flow |
|
(17,845 |
) |
|
|
182,019 |
|
|
|
84,232 |
|
|
|
301,102 |
|
|
|
74,859 |
|
|
|
420,150 |
|
|
Merger and acquisition expenses paid, net of tax benefit |
|
826 |
|
|
|
96 |
|
|
|
942 |
|
|
|
146 |
|
|
|
1,787 |
|
|
|
892 |
|
|
Adjusted free cash flow |
|
$ |
(17,019 |
) |
|
|
$ |
182,115 |
|
|
|
$ |
85,174 |
|
|
|
$ |
301,248 |
|
|
|
$ |
76,646 |
|
|
|
$ |
421,042 |
|
|
(1) Includes the funding of new
loans net of cash repayments and recovery of principal through the
sale of inventories acquired from forfeiture of pawn
collateral.
FIRSTCASH,
INC.RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURESTO GAAP FINANCIAL MEASURES
(CONTINUED)(UNAUDITED)
Constant Currency Results
The Company’s reporting currency is the U.S.
dollar. However, certain performance metrics discussed in this
release are presented on a “constant currency” basis, which is
considered a non-GAAP financial measure. The Company’s management
uses constant currency results to evaluate operating results of
business operations in Latin America, which are primarily
transacted in local currencies.
The Company believes constant currency results
provide valuable supplemental information regarding the underlying
performance of its business operations in Latin America, consistent
with how the Company’s management evaluates such performance and
operating results. Constant currency results reported herein are
calculated by translating certain balance sheet and income
statement items denominated in local currencies using the exchange
rate from the prior-year comparable period, as opposed to the
current comparable period, in order to exclude the effects of
foreign currency rate fluctuations for purposes of evaluating
period-over-period comparisons. Business operations in Mexico,
Guatemala and Colombia are transacted in Mexican pesos, Guatemalan
quetzales and Colombian pesos. The Company also has operations in
El Salvador where the reporting and functional currency is the U.S.
dollar. See the Latin America operations segment tables elsewhere
in this release for an additional reconciliation of certain
constant currency amounts to as reported GAAP amounts.
For further information, please contact: Gar
JacksonGlobal IR GroupPhone: (817) 886-6998Email:
gar@globalirgroup.com
Doug Orr, Executive Vice President and Chief Financial
OfficerPhone: (817) 258-2650Email:
investorrelations@firstcash.comWebsite: investors.firstcash.com
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