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
Date of Report (Date of earliest event reported) January 22, 2008
First Cash Financial Services, Inc.
(Exact name of registrant as specified in its charter)
|
Delaware |
0-19133 |
75-2237318 |
||
|
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
|
690 East Lamar Blvd., Suite 400, Arlington, Texas |
76011 |
|||
| (Address of principal executive offices) | (Zip Code) |
Registrant's telephone number, including area code: (817) 460-3947
________________________________________________________________________________
(Former name or former address, if changed since last report)
| 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: | ||
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |
Item 2.02. Results of Operations and Financial Condition.
First Cash Financial Services, Inc. has issued a press release announcing its financial results for the three and twelve month periods ended December 31, 2007. The Company's press release dated January 22, 2008 announcing the results is attached hereto as Exhibit 99.1 and is incorporated by reference in its entirety into this Item 2.02.
The information provided in this Item 2.02 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 Press Release dated January 22, 2008 announcing the Company's financial results for
the three and twelve month periods ended December 31, 2007.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
First Cash Financial Services, Inc.
(Registrant) |
||
|
January 22, 2008
(Date) |
/s/ R. DOUGLAS ORR
R. Douglas Orr Chief Accounting Officer |
| Exhibit Index | ||
| 99.1 | Press release dated January 22, 2008 | |
EXHIBIT 99.1
First Cash Reports Fourth Quarter Operating Results
ARLINGTON, Texas, Jan. 22, 2008 (PRIME NEWSWIRE) -- First Cash Financial Services, Inc. (Nasdaq:FCFS) today announced revenue, net income and earnings per share for both the three months and the year ended December 31, 2007.
Revenues, earnings and store-openings in fiscal 2007 again grew to record levels. The Company's core pawn and short-term loan businesses saw further acceleration in the fourth quarter of already strong 2007 growth trends, as consumer demand for pawn and short-term loan products increased. Same-store pawn and short-term loan revenues grew by 12% in the fourth quarter, while pawn and short-term loan balances grew by 26% compared to the prior year. In addition to surging consumer demand, the Company attributes much of the growth to continued maturation of the large number of new stores opened over the past five years, especially in emerging markets in Mexico. During 2007, the Company continued to aggressively expand its pawn and short-term loan store base with a total of 52 new store openings in Mexico and 21 store openings in the U.S.
The fourth quarter operating results of the Company's Auto Master division were below expectations, reflecting an unexpected, significant decline in sales, especially in late November and throughout December, and the Company's decision to increase Auto Master's credit loss reserves on a one-time basis by $3.6 million to reflect the possible continuation of these trends into 2008. The Auto Master results reduced previously forecast earnings guidance in the fourth quarter by approximately $0.17 per share.
The Company's earnings from continuing operations for 2007 also reflect the previously reported decision to discontinue short-term loan operations in the District of Columbia ("D.C."). The Company had previously announced plans to discontinue the D.C. operations in 2008; however, updated regulatory guidance accelerated the Company's decision to discontinue these operations effective in December of 2007. All revenues, expenses and income reported in this release for fiscal 2007 and 2006 have been adjusted to reflect reclassification of the discontinued D.C. operations. For 2007, the net effect of this reclassification is to decrease diluted earnings from continuing operations by $0.10 per share, net of tax, and report this same amount as income from discontinued operations. The Company will also record, as a component of discontinued operations, a one-time charge of $0.02 per share for store closing expenses.
After the adjustment for closing the D.C. stores, diluted earnings per share from continuing operations were $0.18 for the fourth quarter of 2007, compared to $0.27 in the fourth quarter of 2006. Diluted earnings per share from continuing operations for fiscal 2007 were $1.00. This represents 14% growth over 2006 diluted earnings per share of $0.88.
The Company's balance sheet and cash flows remain strong. During 2007, the Company continued to fund its working capital needs and its store expansion program through operating cash flows. In addition, the Company repurchased $32 million of its common stock during 2007. Total outstanding debt is well below the Company's 2007 EBITDA of approximately $65 million. The Company expects as well to reduce the $55 million in outstanding bank debt in 2008 through internally generated cash flows.
Looking ahead, the Company believes that it is well-positioned for continued significant growth in 2008. Given the likelihood of continued tightening of consumer credit, the Company believes that customer demand for pawn and short-term loan products will continue to grow. The Company plans to open 80 new store locations in 2008, all of which will be funded out of internally generated cash flows, as has been the case historically. Of the 80 new stores, at least 60 will be pawn and/or consumer loan stores located in Mexico, while the remainder will primarily be short-term loan stores located in Texas.
Relative to the 2008 forecast for Auto Master, management has utilized a conservative earnings estimate based on a continuation of the reduced sales and credit trends experienced in late 2007. Even with this more conservative forecast for Auto Master, this particular operating unit should be profitable and additive to earnings in 2008, and, combined with the strength of the core pawn and short-term loan operations, will provide the Company with consolidated earnings growth from continuing operations of approximately 17% to 20% in 2008.
Additional details regarding fiscal 2007 results from continuing operations and the outlook for 2008 are provided as follows:
Revenues
* Consolidated revenues totaled $388 million in fiscal 2007, an increase of 48%, compared to $262 million for fiscal 2006. Fourth quarter revenues increased by 25%, totaling $107 million compared to $86 million in the prior-year quarter. * Same-store revenue increased 12% in the Company's pawn and short-term loan stores for the fourth quarter of 2007 over the comparable prior-year period, while year-to-date same-store revenue increased 9%. * For fiscal 2007, pawn service charge revenue increased by 22%, while pawn merchandise sales increased by 20%. Combined revenues from the Company's U.S. pawn stores increased by 9% for the year, and revenue from stores in Mexico increased by 32% for the year. * Revenue from the Company's free-standing short-term loan stores increased by 20% for the year and 14% for the quarter (excluding D.C. and Oregon, which had adverse changes in law in 2007). * Same-store revenue for the Auto Master dealerships decreased by 12% for the quarter compared to the comparable prior-year period. The unexpected slowdown in retail sales occurred in late November and throughout December, and was likely caused by a mixture of changing economic conditions and adverse weather factors in a number of key markets. The Company has assumed a continuation of these adverse trends through 2008 and has forecast accordingly.
New Locations
* A total of 20 new retail locations were opened during the fourth quarter of 2007, which were comprised of 12 pawn and short-term loan stores in Mexico and eight short-term loan stores in the U.S. * For the full year, the Company opened 78 new stores, compared to 72 store openings in 2006. Fiscal 2007 store openings consisted of 52 pawn and short-term loan stores in Mexico, 21 short-term loan stores in the U.S. and five Auto Master dealerships. * The Company operated 475 locations as of December 31, 2007, an 18% increase over the prior year. In addition, the Company operates 39 convenience store kiosks through a joint venture.
Operating Metrics
* Total pawn receivable balances at December 31, 2007 increased by 28% compared to the prior year. The increase was comprised of a 52% increase in receivables in the Mexico stores and a 16% increase in the fully-mature U.S. pawn stores. Total short-term loans, including third-party credit services loans outstanding, increased by 20% compared to the prior year. * The gross margin on retail pawn merchandise sales was 43% for the quarter and 44% for the year, compared to the prior-year margin of 44% for both the quarter and the year. The margin on wholesale scrap jewelry sales was 41% for the quarter and 35% for the year, compared to the prior-year margin of 34% for both the quarter and the year. Inventory turns in the pawn stores for fiscal 2007 were 3.4 times compared to 3.2 times in fiscal 2006. * Automotive finance credit conditions deteriorated late in 2007. Given the potential that the trends reflected in the last 45 days of 2007 will continue into 2008, the Company elected to take a one-time, non-cash charge of approximately $3.6 million in the fourth quarter, raising the lending reserve on automotive receivables to 26% of the outstanding notes, compared to the previous reserve of 22%. This increase to the reserve is intended to provide reasonable assurance that should prior quarter credit trends persist into 2008, reserves are adequate on a going-forward basis. * The short-term loan credit loss provision for the fourth quarter in the pawn and short-term loan stores was 34% of fees, compared to 31% for the 2006 fourth quarter. For the year, the loss provision was 29% of fees, compared to 24% for fiscal 2006. The Company attributes most of the change to an increased percentage of revenues from newer stores, which historically have had greater credit loss provisions, and to reduced sales of charged-off accounts, which help offset the loss provision. Debt sales were $664,000 in 2007, compared to $1.9 million in the prior year. The company does not view the increase in the short-term loan credit loss provision as an adverse trend, as it expects future improvement in credit losses as the store-base matures.
2008 Outlook
* The Company is updating its 2008 earnings guidance to reflect the discontinued operations in D.C. and a more conservative forecast for the Auto Master division. Earnings per share from continuing operations is now targeted to be in the range of $1.17 to $1.20 per share, which represents an increase of 17% to 20% over 2007 earnings from continuing operations. * The Company is forecasting a total of 80 store openings in 2008, which will be comprised of approximately 60 pawn and short-term loan stores in Mexico, 17 to 18 U.S. short-term loan stores and 2 to 3 automotive dealerships.
Commentary & Analysis
Rick Wessel, Chief Executive Officer of First Cash, commented on the Company's 2007 results, "While we are disappointed with the anticipated and previously reported closing of our D.C. stores, as well as the fourth quarter results of Auto Master, we remain comfortable with and confident in our prospects for 2008 and beyond. The growth engine driven by our core pawn and short-term expansion strategy is stronger than ever. In Mexico, our newer stores are ramping to profitability at a record pace, and we continue to identify and secure new markets for growth. We have expanded our product offerings in Mexico with our CashYa! store concept, while in the U.S., we are introducing an installment loan product in many of our First Cash Advance markets. In addition, Auto Master was accretive to earnings in 2007 despite the disappointing fourth quarter results; even with a more conservative outlook for 2008, we expect it to remain additive to earnings and a positive strategic and financial contributor to our revenues an d earnings on a going-forward basis.
"Our forecast for 2008 provides for strong earnings growth of 17% to 20% and an aggressive, but achievable, store opening plan which will increase our store count to over 550 locations by year end. First Cash continues to generate significant positive operating cash flows, and our balance sheet remains minimally levered. Our diversified product portfolio and geographic footprint position us to grow, even in turbulent economic conditions. Management is committed to continue building short- and long-term shareholder value through a continuation of its organic expansion strategy and/or through other external transactions as they may become available."
Forward-Looking Information
This release may contain forward-looking statements about the business, financial condition and prospects of 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 "believes," "projects," "expects," "may," "estimates," "should," "plans," "intends," "could," or "anticipates," or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy. Forward-looking statements can also be identified by the fact that 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. Forward-looking statements in this release include, without limitation, the Company's expectations of earnings per share, earnings growth, expansion strategies, store and dealership openings, future liquidity, cash flows, credit loss provisions, debt repayments, consumer demand for the Company's products and services, competition, and other performance results. These statements are made to provide the public with management's current assessment of the Company's business. Although the Company believes that the expectations reflected in forward-looking statements are reasonable, there can be no assurances that such expectations will prove to be accurate. Security holders are cautioned that such forward-looking statements involve risks and uncertainties. The forward-looking statements contained in this release speak only as of the date of this statement, 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 ba sed. Certain factors may cause results to differ materially from those anticipated by some of the statements made in this release. Such factors are difficult to predict and many are beyond the control of the Company and may include changes in regional, national or international economic conditions, changes in consumer borrowing and repayment behaviors, changes in credit markets, credit losses, changes or increases in competition, the ability to locate, open and staff new stores and dealerships, the availability or access to sources of inventory, inclement weather, the ability to successfully integrate acquisitions, the ability to retain key management personnel, the ability to operate with limited regulation as a credit services organization in Texas, new legislative initiatives or governmental regulations (or changes to existing laws and regulations) affecting short-term loan/payday advance businesses, credit services organizations, pawn businesses and buy-here/pay-here automotive businesses in both the U.S . and Mexico, unforeseen litigation, changes in interest rates, changes in tax rates or policies, changes in gold prices, changes in energy prices, changes in used-vehicle prices, cost of funds, changes in foreign currency exchange rates, future business decisions, and other uncertainties. These and other risks and uncertainties are further and more completely described in the Company's 2006 Annual Report on Form 10-K (see "Item 1A. Risk Factors") and updated in subsequent releases on Form 10-Q.
About First Cash
First Cash Financial Services, Inc. is a leading specialty retailer and provider of consumer financial services. Its pawn stores make small loans secured by pledged personal property, retail a wide variety of jewelry, electronics, tools and other merchandise, and in many locations, provide short-term loans and credit services products. The Company's short-term loan locations provide various combinations of short-term loan products, check-cashing, credit services and other financial services products. First Cash also operates automobile dealerships focused on the "buy-here/pay-here" segment of the used-vehicle retail market. In total, the Company owns and operates over 475 stores and buy-here/pay-here dealerships in thirteen U.S. states and eleven states in Mexico. First Cash is also an equal partner in Cash & Go, Ltd., a joint venture, which owns and operates 39 check-cashing and financial services kiosks located inside convenience stores.
First Cash is a component company in both the Standard & Poor's SmallCap 600 Index(r) and the Russell 2000 Index(r). First Cash's common stock (ticker symbol "FCFS") is traded on the Nasdaq Global Select Market, which has the highest initial listing standards of any stock exchange in the world based on financial and liquidity requirements.
The First Cash Financial Services, Inc. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=3365
STORE COUNT ACTIVITY
The following tables detail store openings and closings for the three
months and twelve months ended December 31, 2007:
Mexico
U.S. Locations Locations
------------------------------ ----------
Short-Term
Loan/ Buy-Here/ Pawn/
Check- Pay-Here Short-Term
Pawn Cashing Automotive Loan Total
Stores Stores Dealerships Stores Locations
------ --------- ----------- ----------- ----------
Three Months Ended
December 31, 2007
------------------
Total locations,
beginning of
period 94 156 15 195 460
New locations
opened -- 8 -- 12 20
Locations
closed or
consolidated -- -- -- -- --
Discontinued
operations
in D.C. 2 (7) -- -- (5)
--- ---- ---- ---- ----
Total
locations,
end of
period 96 157 15 207 475
=== ==== ==== ==== ====
Twelve Months Ended
December 31, 2007
--------------------
Total
locations,
beginning
of period 95 145 10 157 407
New locations
opened -- 21 5 52 78
Locations
closed or
consolidated (1) (2) -- (2) (5)
Discontinued
operations
in D.C. 2 (7) -- -- (5)
--- ---- ---- ---- ----
Total
locations,
end of
period 96 157 15 207 475
=== ==== ==== ==== ====
For the three months and twelve months ended December 31, 2007, the Company's 50% owned joint venture, Cash & Go, Ltd., operated a total of 39 kiosks located inside convenience stores in the state of Texas, which are not included in the above charts. During the twelve months ending December 31, 2007, the Company closed one Cash & Go, Ltd. kiosk.
During December the Company discontinued short-term loan operations in its seven short-term loan stores in D.C. Five of the stores are being closed while two are being converted to pawn stores.
FIRST CASH FINANCIAL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------------------------------
2007 2006 2007 2006(1)
----- ---- ---- ---------
(unaudited)
(in thousands, except per share amounts)
Revenue:
Merchandise sales $ 69,463 $ 53,623 $ 252,349 $ 149,473
Finance and service
charges 36,722 31,394 131,933 108,677
Other 1,012 1,027 4,168 3,973
--------- --------- ---------- ----------
107,197 86,044 388,450 262,123
--------- --------- ---------- ----------
Cost of revenue:
Cost of goods sold 37,524 28,915 134,615 84,229
Credit loss provision 21,582 9,914 58,140 20,452
Other 89 128 358 440
--------- --------- ---------- ----------
59,195 38,957 193,113 105,121
--------- --------- ---------- ----------
Net revenue 48,002 47,087 195,337 157,002
--------- --------- ---------- ----------
Expenses and other
income:
Store operating
expenses 27,439 22,735 101,454 79,203
Administrative
expenses 7,745 7,870 29,290 24,671
Depreciation and
amortization 2,806 2,334 10,803 7,978
Interest expense 951 697 2,438 916
Interest income (22) (36) (78) (727)
--------- --------- ---------- ----------
38,919 33,600 143,907 112,041
--------- --------- ---------- ----------
Income from continuing
operations before
income taxes 9,083 13,487 51,430 44,961
Provision for
income taxes 3,306 4,686 18,720 16,186
--------- --------- ---------- ----------
Income from continuing
operations $ 5,777 $ 8,801 $ 32,710 $ 28,775
Income from
discontinued
operations,
net of tax 770 891 3,386 2,969
Loss on disposal,
net of tax (808) -- (808) --
--------- --------- ---------- ----------
Net income $ 5,739 $ 9,692 $ 35,288 $ 31,744
========= ========= ========== ==========
Basic income per share:
Income from
continuing operations $ 0.19 $ 0.28 $ 1.04 $ 0.91
Income from
discontinued
operations 0.02 0.03 0.11 0.09
Loss from disposal (0.02) -- (0.03) --
--------- --------- ---------- ----------
Net income per
basic share $ 0.19 $ 0.31 $ 1.12 $ 1.00
========= ========= ========== ==========
Diluted income per share:
Income from
continuing operations $ 0.18 $ 0.27 $ 1.00 $ 0.88
Income from
discontinued
operations 0.02 0.03 0.10 0.09
Loss from disposal (0.02) -- (0.02) --
--------- --------- ---------- ----------
Net income per
diluted share $ 0.18 $ 0.30 $ 1.08 $ 0.97
========= ========= ========== ==========
Weighted average shares
outstanding:
Basic 30,899 31,253 31,564 31,448
Diluted 31,815 32,785 32,824 32,859
(1) On August 25, 2006, the Company acquired Guaranteed Auto Finance,
Inc. and SHAC, Inc. (collectively doing business as "Auto Master").
Accordingly, the Condensed Consolidated Statements of Income for
the twelve month period ending December 31, 2006 does not include
the results of Auto Master prior to August 25, 2006.
FIRST CASH FINANCIAL SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31,
-------------------
2007 2006
-------- --------
(unaudited)
ASSETS
Cash and cash equivalents $ 14,175 $ 15,535
Finance and service charges receivable 7,867 4,966
Customer receivables, net of allowances 74,532 57,564
Inventories 35,612 28,761
Prepaid expenses and other current assets 9,103 5,901
Discontinued operations 1,509 2,687
-------- --------
Total current assets 142,798 115,414
Customer receivables with long-term
maturities, net of allowance 31,218 14,013
Property and equipment, net 43,762 30,643
Goodwill and other intangible assets, net 72,340 72,544
Other 1,430 1,228
-------- --------
Total assets $291,548 $233,842
======== ========
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current portion of notes payable $ 2,250 $ 2,250
Accounts payable 1,732 1,535
Accrued liabilities 17,066 17,976
-------- --------
Total current liabilities 21,048 21,761
Revolving credit facility 55,000 8,000
Notes payable, net of current portion 3,938 7,188
Deferred income taxes payable 10,353 8,297
-------- --------
Total liabilities 90,339 45,246
Stockholders' equity 201,209 188,596
-------- --------
Total liabilities and stockholders' equity $291,548 $233,842
======== ========
FIRST CASH FINANCIAL SERVICES, INC.
REVENUE, COST OF REVENUE AND NET REVENUE BY PRODUCT LINE
The following tables detail revenue, cost of revenue and net revenue
from continuing operations by product line for the three months ended
December 31, 2007 and December 31, 2006 (unaudited, amounts in
thousands):
Short-Term
Loan/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
------- ------- ---------- --------
Three Months Ended
December 31, 2007
------------------
Revenue:
Merchandise sales:
Retail $32,778 $ -- $ 24,593 $ 57,371
Wholesale 11,432 -- 660 12,092
Finance and service charges 16,517 17,959 2,246 36,722
Other 12 942 58 1,012
------- ------- --------- --------
60,739 18,901 27,557 107,197
------- ------- --------- --------
Cost of revenue:
Cost of goods sold:
Retail 18,580 -- 11,022 29,602
Wholesale 6,728 -- 1,194 7,922
Credit loss provision -- 6,056 15,526 21,582
Other -- 89 -- 89
------- ------- --------- --------
25,308 6,145 27,742 59,195
------- ------- --------- --------
Net revenue $35,431 $12,756 $ (185) $ 48,002
======= ======= ========= ========
Three Months Ended
December 31, 2006
------------------
Revenue:
Merchandise sales:
Retail $28,906 $ -- $ 16,286 $ 45,192
Wholesale 8,048 -- 383 8,431
Finance and service charges 13,366 17,009 1,019 31,394
Other 10 962 55 1,027
------- ------- --------- --------
50,330 17,971 17,743 86,044
------- ------- --------- --------
Cost of revenue:
Cost of goods sold:
Retail 16,082 -- 6,905 22,987
Wholesale 5,294 -- 634 5,928
Credit loss provision -- 5,329 4,585 9,914
Other -- 128 -- 128
------- ------- --------- --------
21,376 5,457 12,124 38,957
------- ------- --------- --------
Net revenue $28,954 $12,514 $ 5,619 $ 47,087
======= ======= ========= ========
FIRST CASH FINANCIAL SERVICES, INC.
REVENUE, COST OF REVENUE AND NET REVENUE BY PRODUCT LINE
(CONTINUED)
The following tables detail revenue, cost of revenue and net revenue
from continuing operations by product line for the twelve months
ended December 31, 2007 and December 31, 2006 (unaudited, amounts in
thousands):
Short-Term
Loan/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
-------- ------- ---------- --------
Twelve Months Ended
December 31, 2007
-------------------
Revenue:
Merchandise sales:
Retail $112,316 $ -- $ 98,358 $210,674
Wholesale 39,310 -- 2,365 41,675
Finance and service charges 59,234 65,404 7,295 131,933
Other 66 3,932 170 4,168
-------- ------- -------- --------
210,926 69,336 108,188 388,450
-------- ------- -------- --------
Cost of revenue:
Cost of goods sold:
Retail 63,229 -- 41,969 105,198
Wholesale 25,524 -- 3,893 29,417
Credit loss provision -- 18,658 39,482 58,140
Other -- 358 -- 358
-------- ------- -------- --------
88,753 19,016 85,344 193,113
-------- ------- -------- --------
Net revenue $122,173 $50,320 $ 22,844 $195,337
======== ======= ======== ========
Twelve Months Ended
December 31, 2006
-------------------
Revenue:
Merchandise sales:
Retail $ 94,764 $ -- $ 22,507 $117,271
Wholesale 31,672 -- 530 32,202
Finance and service charges 48,672 58,657 1,348 108,677
Other 23 3,869 81 3,973
-------- ------- -------- --------
175,131 62,526 24,466 262,123
-------- ------- -------- --------
Cost of revenue:
Cost of goods sold:
Retail 52,716 -- 9,654 62,370
Wholesale 21,015 -- 844 21,859
Credit loss provision -- 14,315 6,137 20,452
Other -- 440 -- 440
-------- ------- -------- --------
73,731 14,755 16,635 105,121
-------- ------- -------- --------
Net revenue $101,400 $47,771 $ 7,831 $157,002
======== ======= ======== ========
FIRST CASH FINANCIAL SERVICES, INC.
SELECTED ASSETS BY PRODUCT LINE
The following table details selected assets from continuing
operations by product line as of December 31, 2007 and December 31,
2006 (unaudited, amounts in thousands):
Short-Term
Loan/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
-------- -------- --------- --------
December 31, 2007
-----------------
Customer receivables,
with current and
long-term maturities $ 41,599 $ 5,774 $ 79,158 $126,531
CSO loans held by
independent third-party
lender (1) -- 15,536 -- 15,536
Allowances for doubtful
accounts -- (1,137) (20,455) (21,592)
-------- -------- --------- --------
$ 41,599 $ 20,173 $ 58,703 $120,475
======== ======== ========= ========
Inventories $ 26,870 $ -- $ 8,742 $ 35,612
======== ======== ========= ========
December 31, 2006
-----------------
Customer receivables,
with current and
long-term maturities $ 32,459 $ 4,969 $ 43,827 $ 81,255
CSO loans held by
independent third-party
lender (1) -- 12,732 -- 12,732
Allowances for doubtful
accounts -- (715) (9,532) (10,247)
-------- -------- --------- --------
$ 32,459 $ 16,986 $ 34,295 $ 83,740
======== ======== ========= ========
Inventories $ 25,034 $ -- $ 3,727 $ 28,761
======== ======== ========= ========
(1) CSO loans outstanding are from an independent third-party
lender and are not included on the Company's balance sheet.
FIRST CASH FINANCIAL SERVICES, INC.
UNAUDITED NON-GAAP FINANCIAL INFORMATION - EBITDA
EBITDA is commonly used by investors to assess a company's leverage
capacity, liquidity and financial performance. EBITDA is not
considered a measure of financial performance under U.S. generally
accepted accounting principles ("GAAP"), and the items excluded from
EBITDA are significant components in understanding and assessing the
Company's financial performance. Since EBITDA is not a measure
determined in accordance with GAAP and is thus susceptible to varying
calculations, EBITDA, as presented, may not be comparable to other
similarly titled measures of other companies. EBITDA should not be
considered as an alternative to net income, cash flows provided by or
used in operating, investing or financing activities or other
financial statement data presented in the Company's consolidated
financial statements as an indicator of financial performance or
liquidity. Non-GAAP measures should be evaluated in conjunction with,
and are not a substitute for, GAAP financial measures. The following
table provides a reconciliation of income from continuing operations
to EBITDA (unaudited, amounts in thousands):
Twelve Months Ended
December 31,
-----------------------
2007 2006
--------- ---------
Income from continuing operations $ 32,710 $ 28,775
Adjustments:
Income taxes 18,720 16,186
Depreciation and amortization 10,803 7,978
Interest expense 2,438 916
Interest income (78) (727)
--------- ---------
Earnings from continuing operations
before interest, income taxes,
depreciation and amortization $ 64,593 $ 53,128
========= =========
EBITDA margin calculated as follows:
Total revenue $ 388,450 $ 262,123
Earnings from continuing operations
before interest, income taxes,
depreciation and amortization 64,593 53,128
--------- ---------
EBITDA as a percent of revenue 17% 20%
========= =========
CONTACT: First Cash Financial Services, Inc.
Rick Wessel, Vice Chairman & Chief Executive Officer
Doug Orr, Executive Vice President & Chief Financial Officer
(817) 505-3199
investorrelations@firstcash.com
www.firstcash.com