UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
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April 24, 2006 |
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(Date of Report - Date of Earliest Event Reported) |
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First Cash Financial Services, Inc. |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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(State or other jurisdiction of incorporation) |
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0-19133 |
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75-2237318 |
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(Commission File Number) |
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(IRS Employer Identification No.) |
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690 East Lamar Blvd., Suite 400, Arlington, Texas 76011 |
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(Address of principal executive offices, including zip code) |
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(817) 460-3947 |
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(Registrant’s telephone number, including area code) |
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Item 8.01 Other Events
First Cash Financial Services, Inc. has made available on its corporate website (www.firstcash.com) its most recent investor presentation. This presentation is included herein as Exhibit 99.1.
The information provided in this Item 8.01 shall not be deemed “filed” for purposes of the Securities Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by the specific reference in such filing.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits:
99.1 First Cash Financial Services, Inc. Investor Presentation
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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Dated: April 24, 2006 |
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FIRST CASH FINANCIAL SERVICES, INC. |
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(Registrant) |
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/s/ R. DOUGLAS ORR |
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R. Douglas Orr |
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Chief Accounting Officer |
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EXHIBIT INDEX
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Exhibit Number |
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Document |
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99.1 |
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First Cash Financial Services, Inc. Investor Presentation |
4
Exhibit 99.1
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[LOGO OF FIRST CASH]
INVESTOR PRESENTATION - APRIL 2006
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Certain statements included in this presentation which are not historical in nature, including statements regarding the Company’s and/or management’s strategies, beliefs, expectations, plans for new stores, projections of earnings and revenues, expected effect of regulatory pronouncements, potential legislation, or other predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and are intended to be covered by the Safe Harbor provisions for forward-looking statements contained in such Act. |
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Forward-looking statements are made based on assumptions involving certain known and unknown risks and uncertainties, many of which are beyond the Company’s control, and other important factors that could cause actual results, performance or achievements to differ materially from expectations expressed or implied by such forward-looking statements. These risk factors and uncertainties are listed from time to time in the Company’s filings with the Securities and Exchange Commission, including, but not limited to, our annual reports on Form 10-K for the years ending December 31, 2004 and 2005, our report on Form 10-Q for the period ended March 31, 2006, and on various Form 8-K filings in 2006. |
FIRST CASH FINANCIAL SERVICES
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Leading provider of diversified specialty consumer finance products |
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Superior earnings performance and financial position |
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Significant future growth through store expansion |
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[GRAPHIC APPEARS HERE] |
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FIRST CASH FINANCIAL SERVICES
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1988 |
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Founded – 3 pawn stores in Texas |
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Early 90’s |
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Goes public; multi-state pawn store roll-up acquisitions |
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Late 90’s |
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Payday lending acquisitions; introduction of payday product in pawn stores |
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[GRAPHIC APPEARS HERE] |
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First pawn stores opened in Mexico |
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2001 to present |
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Expansion through new store openings: U.S. payday & Mexico pawn |
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2005 |
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Introduction of credit services product |
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
Geographic Markets & Product Offerings
As of March 31, 2006
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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Short-term loan secured by pledged personal property |
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No credit check |
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No bank account required |
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Regulations vary by state - typically provide for: |
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30 day term |
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10% to 20% monthly service fee |
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
First Cash Pawn Loan Growth
[CHART APPEARS HERE]
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Many un-banked or under-banked customers |
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Both in the U.S. and… |
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In Mexico, where: |
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88% of retail transactions are in cash |
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An estimated 80% of the population is un-banked |
FIRST CASH FINANCIAL SERVICES
Composition of Retail Inventories
[CHART APPEARS HERE]
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Retail inventories are primarily acquired via forfeited pawn loan collateral |
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Gold jewelry represents 58% of the retail inventory |
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Retail Metrics (trailing 12 Months) |
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Total merchandise margins |
40% |
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Retail margins (excludes scrap jewelry sales) |
44% |
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Inventory turns |
3.1x |
FIRST CASH FINANCIAL SERVICES
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Loan size: $100 to $1,000 |
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Term: 7 to 31 days |
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Typical service charge per advance: 15% |
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Proof of employment and active bank account required – but no credit check |
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Advance secured by personal check held until due date |
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
Payday Advance Regulatory Landscape
FDIC regulations affect only payday lending in other states where “bank model” is used
First Cash does not utilize the bank model in any state and is therefore not subject to FDIC regulations
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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In its Texas locations, First Cash has elected to operate as a Credit Services Organization (“CSO”) |
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As a CSO, First Cash provides customers access to a short-term loan funded by an independent consumer lending company |
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Customer pays a fee to CSO for its services: |
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processing of application with lender |
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providing letter of credit |
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disbursement and collection of lender funds |
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Customer pays interest to lender (at less than 10% APR) |
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FIRST CASH FINANCIAL SERVICES
Superior Performance & Financial Position
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Operating Results |
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Industry leading performance metrics |
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Consistent growth |
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Increasing profit margins |
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Financial Position |
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Debt-free |
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Strong cash flows |
Revenues
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
2006 - First Quarter Highlights
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Q1 diluted EPS of $0.23 |
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Up 28% over prior year |
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Exceeded consensus estimate by $0.02 |
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21st consecutive quarter of double-digit EPS growth |
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Other highlights: |
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Quarterly revenues up 19%, to $56 million |
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Net income of $7.6 million, up 26% |
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20 new stores, a record number of openings for a single quarter |
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
Reflects two-for-one stock split effective February 6, 2006
FIRST CASH FINANCIAL SERVICES
Consistency of Growth & Earnings
Trailing 12 Months Diluted Earnings per Share
[CHART APPEARS HERE]
Reflects two-for-one stock split effective February 6, 2006
[LOGO OF FORBES]
Forbes 200 Best
Small
Companies
4 straight years
[LOGO OF FORTUNE SMALL BUSINESS]
Fortune Small
Business 100
2 straight years
FIRST CASH FINANCIAL SERVICES
2006 Earnings & Growth Expectations
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Earnings per share forecast |
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Raised guidance at end of Q1 to: |
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$0.93 to $0.94 per share |
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Represents 22% to 24% increase over 2005 EPS |
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Q2 earnings forecast for $0.18 to $0.19 |
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Store Openings |
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60 - 70 new store openings projected for 2006 |
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Pawn (Mexico) |
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Payday Advance (U.S.) |
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20 stores opened in the first quarter |
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FIRST CASH FINANCIAL SERVICES
Increasing Market Visibility & Liquidity
Two-for-one stock split effective February 6, 2006
Market Cap
[CHART APPEARS HERE]
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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All store openings funded from current cash flows |
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Loan growth at new & existing stores |
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Capital expenditures for new stores |
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Start-up costs for new stores |
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Stock repurchases of $24 million over past two years |
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[GRAPHIC APPEARS HERE] |
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New location under construction in Tijuana, Mexico
FIRST CASH FINANCIAL SERVICES
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New store openings in multiple markets |
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United States |
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Mexico |
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Diversified product line |
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Pawn loans & related retail |
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Payday advances |
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Credit services |
[GRAPHIC APPEARS HERE]
First Cash Advance location in Hurst, Texas
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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Cap Ex |
$80,000 to $150,000 |
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- Leasehold improvements |
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- Computer & security equipment |
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Working Capital (first year) |
$80,000 to $150,000 |
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- Operating cash |
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- Loan funding |
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- Inventory (pawn only) |
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Start-up Losses |
$40,000 to $60,000 |
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- Pre-opening |
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- First six months of operation |
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Totals |
$200,000 to $360,000 |
FIRST CASH FINANCIAL SERVICES
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
First Cash Pawn Stores in Mexico
[GRAPHICS APPEAR HERE]
FIRST CASH FINANCIAL SERVICES
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Continued growth in key Texas markets: |
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Dallas/Fort Worth |
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Houston |
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San Antonio/Austin |
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Other mid-sized markets in Texas |
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First stores in Michigan opened in Q2 of 2006 |
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FIRST CASH FINANCIAL SERVICES
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Industry leader in a fast growth sector |
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Strong demand for specialty consumer finance products |
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Multiple products: pawn and payday advance |
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Superior financial metrics |
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21 consecutive quarters (over five years) of double-digit EPS growth |
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Strong cash flows; no debt |
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Well-defined expansion strategy will drive continued growth |
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Significant headroom for new stores in multiple markets |
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20% increase in store count targeted for 2006 |
FIRST CASH FINANCIAL SERVICES
[LOGO OF FIRST CASH]
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Investor contact information: |
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Phone: |
817.505.3199 |
[LOGO OF FCFS] |
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Email: |
investorrelations@firstcash.com |
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Website: |
www.firstcash.com |
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