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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
January 24, 2007
----------------
(Date of Report - Date of Earliest Event Reported)
First Cash Financial Services, Inc.
-----------------------------------
(Exact name of registrant as specified in its charter)
Delaware
--------
(State or other jurisdiction of incorporation)
0-19133 75-2237318
------- ----------
(Commission File Number) (IRS Employer Identification No.)
690 East Lamar Blvd., Suite 400, Arlington, Texas 76011
-------------------------------------------------------
(Address of principal executive offices, including zip code)
(817) 460-3947
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(Registrant's telephone number, including area code)
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 month and twelve month periods ended December
31, 2006. The Company's press release dated January 24, 2007 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 date January 24, 2007 announcing the Company's financial
results for the three month and twelve month periods ended December
31, 2006.
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.
Dated: January 24, 2007 FIRST CASH FINANCIAL SERVICES, INC.
-----------------------------------
(Registrant)
/s/ R. DOUGLAS ORR
-----------------------------------
R. Douglas Orr
Chief Accounting Officer
EXHIBIT INDEX
Exhibit Number Document
- -------------- --------
99.1 Press release dated January 24, 2007.
Exhibit 99.1
First Cash Reports 30% Increase in Fourth Quarter EPS
Fiscal 2006 Earnings Up 28%
Company Affirms 2007 Guidance
Earnings Projected to Increase 29% to 34%
ARLINGTON, Texas--(BUSINESS WIRE)--Jan. 24, 2007--First Cash
Financial Services, Inc. (Nasdaq:FCFS) today announced record
revenues, net income and earnings per share for both the three months
and the year ended December 31, 2006. This marked First Cash's 24th
consecutive quarter, covering a six-year period, of double-digit
growth in earnings per share. In addition, the Company reaffirmed
earnings per share guidance for 2007 of $1.25 to $1.30, a 29% to 34%
increase over 2006 earnings.
Earnings
-- Diluted earnings per share for the fourth quarter of 2006 were
$0.30, a 30% increase compared to diluted earnings per share
of $0.23 in the fourth quarter of 2005.
-- Diluted earnings per share for fiscal 2006 were $0.97. This
represents 28% growth over 2005 diluted earnings per share of
$0.76.
-- Net income for the fourth quarter of 2006 was $9.7 million, a
26% increase over fourth quarter 2005 net income of $7.7
million. Net income for fiscal 2006 was $31.7 million,
compared to $25.4 million for fiscal 2005, an increase of 25%.
Revenues
-- Consolidated revenues for the fourth quarter of 2006 increased
by 47%, totaling $88 million compared to $60 million in 2005.
Total revenues for fiscal 2006 were $270 million, compared to
$208 million for fiscal 2005, an increase of 30%.
-- Same-store revenues increased 9% for both the fourth quarter
and full year of 2006 over the comparable prior-year periods.
-- Combined pawn revenues, which include service charges and
merchandise sales, increased by 22% in fiscal 2006, while
combined cash advance fees and credit services revenues
increased by 9% for the year.
-- The Company recorded fiscal 2006 revenues of $24 million from
Auto Master, a buy-here/pay-here automotive retailer acquired
in August 2006. Auto Master's unaudited proforma revenues
totaled $60.9 million for all of 2006.
New Locations
-- A total of 9 new retail locations were opened during the
fourth quarter of 2006, which was comprised of 5 cash advance
stores, 2 pawn stores, and 2 Auto Master buy-here/pay-here
dealerships.
-- For the full year, the Company opened or acquired 80 new
locations, an increase of 60% over the 50 units opened in
2005. This includes the 8 Auto Master buy-here/pay-here
dealerships acquired by the Company in August of 2006.
-- The overall store and dealership count totals 407 units as of
December 31, 2006, a 24% increase over the 328 units at
December 31, 2005.
Operating Metrics
-- Earnings before interest, taxes, depreciation and amortization
(EBITDA) for fiscal 2006 totaled $58 million, an increase of
28% over the comparative prior-year period. The EBITDA margin
for 2006 was over 21%. A detailed reconciliation of this
non-GAAP financial measure to net income is provided elsewhere
in this release.
-- The Company's return on stockholders' equity increased to
18.4% in fiscal 2006, compared to 16.6% for 2005.
-- Domestic pawn balances totaled $21.4 million at December 31,
2006, an increase of 15% over the prior year, while
end-of-year pawn balances in Mexico totaled $11.1 million, an
increase of 28% over the prior year. Total cash advance and
third-party credit services loans outstanding totaled $20.2
million at year end. The combined loan balances in the
Company's free-standing cash advance stores increased by 27%
over the prior year.
-- The gross margin on retail pawn merchandise sales for both the
fourth quarter and full year of 2006 was 44%, which was
consistent with margins recorded in the prior year. The gross
margin on wholesale scrap jewelry for both the fourth quarter
and full year of 2006 was 34%, compared to the prior year
margins of 21% and 22%, respectively. This difference was
primarily a result of increased gold prices during the
applicable periods. The volume-weight of scrap jewelry sold in
the fourth quarter and full year of 2006 increased
approximately 10% and 13%, respectively, compared to the prior
year.
-- The cash advance credit loss provision for fiscal 2006 was
unchanged from the prior year at 23% of fees. The fourth
quarter credit provision was 29% of fees, compared to 28% in
the prior-year fourth quarter; the increase was due to the
fact that the Company did not sell any portion of its
charged-off receivable portfolio during the fourth quarter of
2006.
-- Gross margins on retail automotive sales of Auto Master were
58% during the fourth quarter of 2006, while the margin net of
the credit loss provision was 29%. The fourth quarter credit
loss provision, at 28% of retail sales, reflected seasonal
factors and higher loss provision accruals for the two new
dealerships opened in November 2006.
Financial Position & Liquidity
-- During 2006, First Cash utilized operating cash flows to fund
$25 million in stock repurchases and $15 million in capital
expenditures, related primarily to new store openings.
-- The Company reduced its outstanding interest-bearing debt by
$24 million during the fourth quarter. At year end,
interest-bearing debt was $17 million, compared to $41 million
immediately following the acquisition of Auto Master at
September 30, 2006.
-- The ratio of total assets to total liabilities at December 31,
2006 was 5 to 1; the current ratio was at 6 to 1.
2007 Outlook
-- The Company expects continued strong earnings growth in 2007
from its core pawn and cash advance businesses, primarily
driven through its well-established and on-going store
expansion strategy. Combined with the projected accretive
earnings impact from Auto Master, the Company's earnings per
share estimate for 2007 is currently projected to be $1.25 to
$1.30 per share. This represents an increase of 29% to 34%
over 2006 diluted earnings per share.
-- For fiscal 2007, the Company expects to open a combination of
75 to 80 pawn and cash advance locations and 3 to 5 new Auto
Master dealerships. In total, the Company projects 78 to 85
combined unit openings for 2007, an increase of 19% to 21%
over the current unit base.
Commentary & Analysis
Mr. Rick Wessel, Vice Chairman and Chief Executive Officer,
commented on the Company's operating results, "Fiscal 2006 was a
tremendous year for First Cash in all respects, as we again posted
record revenues, profits and unit growth. We completed the year with
an especially strong fourth quarter, which reflected significant
acceleration of our revenue and earnings growth. Other significant
accomplishments in 2006 included the completion of a strategic and
very accretive acquisition, the opening of our 400th store location,
and our second stock split in the last three years. Additionally, we
marked our 24th consecutive quarter of double-digit growth in earnings
per share. Our consistently strong operating results over this
six-year period are the result of our diversified expansion strategy,
operating discipline and focus on key financial metrics."
In addition to posting 28% earnings per share growth in 2006, the
Company grew revenues by 30% compared to the prior year, while fourth
quarter revenues increased at an even greater rate of 47%. Revenues
from Auto Master, the buy-here pay-here automobile retailer and
finance company acquired in August 2006, contributed to this growth,
as did significant revenue increases from the Company's existing pawn
and cash advance businesses. The Company's core base of fully-mature,
domestic pawn stores experienced revenue gains in excess of 9% in
2006, while revenues in the Company's Mexican pawn stores, where the
Company has opened over 150 units over the past five years, increased
by 43%. Fiscal 2006 service charges in the Company's free-standing
cash advance stores increased 11% for the full year, and 16% in the
fourth quarter, due in large part to new store openings in late 2005
and earlier in 2006.
The impact of the Company's continued focus on both short and
long-term, diversified growth in 2006 was evidenced by both the record
pace of new store-openings and the acquisition of Auto Master, through
which the Company has expanded into the significant buy-here/pay-here
automotive retail and finance segment. Including the eight acquired
Auto Master dealerships, First Cash added a record 80 locations during
2006, which represents a unit count increase of 24%. The type of new
locations opened in 2006 was diversified between pawn stores, cash
advance stores and buy-here/pay-here dealerships. Geographically, the
Company added new locations in 2006 in eleven different states in the
U.S. and Mexico.
In discussing the Company's expansion strategy, Mr. Wessel
commented, "First Cash's ability to serve its core customer base
through a diversified set of products and locations is key to our
success and is innovative and unique within our industry. With a now
well-distributed mix of new pawnshops, cash advance stores and
buy-here/pay-here dealerships; we have built three significant
synergistically compatible platforms for future growth that complement
and support each other. In addition, we have geographic diversity in
multiple markets, both in the U.S. and Mexico."
The Company expects that its growth will continue to be funded
primarily through internally generated cash flows. These strong cash
flows, coupled with the Company's strong balance sheet, provide
significant capacity to fund future expansion and other comparable
growth opportunities and products as they arise. In 2006, the Company
utilized $25 million of available cash to repurchase stock and will
continue to view this as a potential use for future cash flows.
In summary, Mr. Wessel said, "As we look forward to 2007 and
beyond, First Cash will remain focused on executing its
well-established growth strategies and expansions. We see significant
potential for both short and long-term growth in each of our product
lines and in each of our key expansion markets. Accordingly, we are as
confident and excited as ever about our ability to deliver long-term
value to our shareholders."
Forward-Looking Information
This release may contain forward-looking statements about the
business, financial condition and prospects of First Cash Financial
Services, Inc. ("First Cash" or 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, earnings accretion from
acquisitions, store and dealership openings, future liquidity, cash
flows, debt levels 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
based. 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, 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 payday loan/cash 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 indicated in the Company's
2005 Annual Report on Form 10-K (see "Item 1A. Risk Factors") and
updated in subsequent quarterly reports on Form 10-Q.
About First Cash
First Cash Financial Services, Inc. is a leading provider of
specialty consumer financial services and related retail products. Its
pawn stores make small loans secured by pledged personal property,
retail pawned merchandise, and in many locations, provide cash
advances and credit services products. The Company's cash advance
locations provide various combinations of short-term cash advance
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 sales and
financing market. In total, the Company owns and operates over 410
stores and buy-here/pay-here dealerships in thirteen U.S. states and
eight states in Mexico. First Cash is also an equal partner in Cash &
Go, Ltd., a joint venture, which owns and operates check-cashing and
financial services kiosks located inside convenience stores.
First Cash has been recognized for five consecutive years by
Forbes magazine as one of its "200 Best Small Companies." This annual
ranking is based on a combination of profitability and growth
performance measures over the most current one and five-year periods.
In addition, First Cash is a component company in both the Standard &
Poors 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.
Store Openings
The following tables detail store openings and closings for the
three months and twelve months ended December 31, 2006:
Cash
Advance/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
Stores Stores Dealerships Locations
------ -------- ----------- ---------
Three Months Ended December 31,
2006
- ---------------------------------
Total locations, beginning of
period 250 140 8 398
New locations opened 2 5 2 9
Locations acquired - - - -
Locations closed or consolidated - - - -
------ -------- ----------- ---------
Total locations, end of period 252 145 10 407
====== ======== =========== =========
Twelve Months Ended December 31,
2006
- ---------------------------------
Total locations, beginning of
period 226 102 - 328
New locations opened 27 43 2 72
Locations acquired - - 8 8
Locations closed or consolidated (1) - - (1)
------ -------- ----------- ---------
Total locations, end of period 252 145 10 407
====== ======== =========== =========
For the three months and twelve months ended December 31, 2006,
the Company's 50% owned joint venture, Cash & Go, Ltd., operated a
total of 40 kiosks located inside convenience stores in the state of
Texas, which are not included in the above charts. No kiosks were
opened or closed during fiscal 2006.
FIRST CASH FINANCIAL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------- ---------------------
2006 (1) 2005 2006 (1) 2005
----------- -------- ----------- ---------
(unaudited) (unaudited)
(in thousands, except per share amounts)
Revenues:
Merchandise sales $ 53,623 $29,917 $ 149,473 $102,139
Finance and service
charges 33,502 29,315 116,187 101,701
Other 1,050 909 4,062 3,935
----------- -------- ----------- ---------
88,175 60,141 269,722 207,775
----------- -------- ----------- ---------
Cost of revenues:
Cost of goods sold 28,915 18,054 84,229 61,659
Credit loss provision 10,135 4,952 21,463 13,808
Other 128 95 440 301
----------- -------- ----------- ---------
39,178 23,101 106,132 75,768
----------- -------- ----------- ---------
Net revenues 48,997 37,040 163,590 132,007
----------- -------- ----------- ---------
Expenses and other income:
Store operating expenses 23,236 17,931 81,089 67,430
Administrative expenses 7,870 5,736 24,671 19,412
Depreciation and
amortization 2,351 1,609 8,041 5,804
Interest expense 697 - 916 -
Interest income (36) (100) (727) (317)
----------- -------- ----------- ---------
34,118 25,176 113,990 92,329
----------- -------- ----------- ---------
Income before income taxes 14,879 11,864 49,600 39,678
Provision for income taxes 5,187 4,143 17,856 14,295
----------- -------- ----------- ---------
Net income $ 9,692 $ 7,721 $ 31,744 $ 25,383
=========== ======== =========== =========
Net income per share:
Basic $ 0.31 $ 0.25 $ 1.01 $ 0.81
=========== ======== =========== =========
Diluted $ 0.30 $ 0.23 $ 0.97 $ 0.76
=========== ======== =========== =========
Weighted average shares
outstanding:
Basic 31,253 31,400 31,448 31,506
=========== ======== =========== =========
Diluted 32,785 33,174 32,859 33,225
=========== ======== =========== =========
(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
include the results of Auto Master for the period August 26, 2006
through December 31, 2006. All significant intercompany accounts have
been eliminated.
FIRST CASH FINANCIAL SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31,
-----------------------
2006 (1) 2005
----------- -----------
(unaudited)
(in thousands, except
per share data)
ASSETS
Cash and cash equivalents $ 15,535 $ 42,741
Interest and service charges receivable 4,966 4,176
Customer receivables, net of allowances 74,264 33,802
Inventories 28,761 21,987
Prepaid expenses and other current assets 5,901 5,430
----------- -----------
Total current assets 129,427 108,136
Property and equipment, net 30,643 23,565
Goodwill and other intangible assets 72,544 53,237
Other 1,228 1,016
----------- -----------
Total assets $ 233,842 $ 185,954
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of notes payable $ 2,250 $ -
Accounts payable 1,535 908
Accrued liabilities 17,976 13,722
----------- -----------
Total current liabilities 21,761 14,630
Revolving credit facility 8,000 -
Notes payable, net of current portion 7,188 -
Deferred income taxes payable 8,297 8,616
----------- -----------
Total liabilities 45,246 23,246
----------- -----------
Stockholders' equity 188,596 162,708
----------- -----------
Total liabilities and stockholders' equity $ 233,842 $ 185,954
=========== ===========
(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 Balance Sheet as of
December 31, 2006 includes the accounts of Auto Master. All
significant intercompany accounts have been eliminated.
FIRST CASH FINANCIAL SERVICES, INC.
Revenues, Cost of Revenues and Net Revenues by Product Line
- ----------------------------------------------------------------------
The following tables detail revenues, cost of revenues and net
revenues by product line for the three months ended December 31,
2006 and December 31, 2005 (unaudited, amounts shown in thousands):
Cash
Advance/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
-------- -------- ---------- --------
Three Months Ended December 31,
2006
- ---------------------------------
Revenues:
Merchandise sales:
Retail $28,906 $ - $ 16,286 $45,192
Wholesale 8,048 - 383 8,431
Finance and service charges 13,366 19,117 1,019 33,502
Other 7 988 55 1,050
-------- -------- ---------- --------
$50,327 $20,105 $ 17,743 $88,175
-------- -------- ---------- --------
Cost of revenues:
Cost of goods sold:
Retail $16,082 $ - $ 6,905 $22,987
Wholesale 5,294 - 634 5,928
Credit loss provision - 5,550 4,585 10,135
Other - 128 - 128
-------- -------- ---------- --------
$21,376 $ 5,678 $ 12,124 $39,178
-------- -------- ---------- --------
Net revenues $28,951 $14,427 $ 5,619 $48,997
======== ======== ========== ========
Three Months Ended December 31,
2005
- ---------------------------------
Revenues:
Merchandise sales:
Retail $24,549 $ - $ - $24,549
Wholesale 5,368 - - 5,368
Finance and service charges 11,565 17,750 - 29,315
Other 11 898 - 909
-------- -------- ---------- --------
$41,493 $18,648 $ - $60,141
-------- -------- ---------- --------
Cost of revenues:
Cost of goods sold:
Retail $13,832 $ - $ - $13,832
Wholesale 4,222 - - 4,222
Credit loss provision - 4,952 - 4,952
Other - 95 - 95
-------- -------- ---------- --------
$18,054 $ 5,047 $ - $23,101
-------- -------- ---------- --------
Net revenues $23,439 $13,601 $ - $37,040
======== ======== ========== ========
FIRST CASH FINANCIAL SERVICES, INC.
Revenues, Cost of Revenues and Net Revenues by Product Line, Continued
- ----------------------------------------------------------------------
The following tables detail revenues, cost of revenues and net
revenues by product line for the twelve months ended December 31,
2006 and December 31, 2005 (unaudited, amounts shown in thousands):
Cash
Advance/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
--------- -------- ---------- ---------
Twelve Months Ended December
31, 2006
- -------------------------------
Revenues:
Merchandise sales:
Retail $ 94,764 $ - $ 22,507 $117,271
Wholesale 31,672 - 530 32,202
Finance and service charges 48,672 66,167 1,348 116,187
Other 20 3,961 81 4,062
--------- -------- ---------- ---------
$175,128 $70,128 $ 24,466 $269,722
--------- -------- ---------- ---------
Cost of revenues:
Cost of goods sold:
Retail $ 52,716 $ - $ 9,654 $ 62,370
Wholesale 21,015 - 844 21,859
Credit loss provision - 15,326 6,137 21,463
Other - 440 - 440
--------- -------- ---------- ---------
$ 73,731 $15,766 $ 16,635 $106,132
--------- -------- ---------- ---------
Net revenues $101,397 $54,362 $ 7,831 $163,590
========= ======== ========== =========
Twelve Months Ended December
31, 2005
- -------------------------------
Revenues:
Merchandise sales:
Retail $ 81,339 $ - $ - $ 81,339
Wholesale 20,800 - - 20,800
Finance and service charges 40,820 60,881 - 101,701
Other 120 3,815 - 3,935
--------- -------- ---------- ---------
$143,079 $64,696 $ - $207,775
--------- -------- ---------- ---------
Cost of revenues:
Cost of goods sold:
Retail $ 45,354 $ - $ - $ 45,354
Wholesale 16,305 - - 16,305
Credit loss provision - 13,808 - 13,808
Other - 301 - 301
--------- -------- ---------- ---------
$ 61,659 $14,109 $ - $ 75,768
--------- -------- ---------- ---------
Net revenues $ 81,420 $50,587 $ - $132,007
========= ======== ========== =========
FIRST CASH FINANCIAL SERVICES, INC.
Selected Assets by Product Line
- ----------------------------------------------------------------------
The following table details selected assets by product line as of
December 31, 2006 and December 31, 2005 (unaudited, amounts shown in
thousands):
Cash
Advance/ Buy-Here/
Check- Pay-Here
Pawn Cashing Automotive Total
-------- -------- ---------- ---------
December 31, 2006
- -----------------
Customer receivables $32,459 $ 7,740 $ 43,827 $ 84,026
CSO loans held by independent
third-party lender (1) - 12,732 - 12,732
Allowances for doubtful accounts - (739) (9,532) (10,271)
-------- -------- ---------- ---------
$32,459 $19,733 $ 34,295 $ 86,487
-------- -------- ---------- ---------
Inventories $25,034 $ - $ 3,727 $ 28,761
======== ======== ========== =========
December 31, 2005
- -----------------
Customer receivables $27,314 $ 6,730 $ - $ 34,044
CSO loans held by independent
third-party lender (1) 10,724 - 10,724
Allowances for doubtful accounts - (698) - (698)
-------- -------- ---------- ---------
$27,314 $16,756 $ - $ 44,070
-------- -------- ---------- ---------
Inventories $21,987 $ - $ - $ 21,987
======== ======== ========== =========
(1) CSO loans outstanding are comprised of the principal portion
of active CSO loans outstanding from an independent third-party
lender, which 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 net income to EBITDA (unaudited,
amounts in thousands):
Twelve Months Ended
December 31,
--------------------
2006 2005
--------- ---------
Net income $ 31,744 $ 25,383
Adjustments:
Interest expense 916 -
Interest income (727) (317)
Income taxes 17,856 14,295
Depreciation and amortization 8,041 5,804
--------- ---------
Earnings before interest, income taxes,
depreciation and amortization $ 57,830 $ 45,165
========= =========
EBITDA margin calculated as follows:
Total revenues $269,722 $207,775
Earnings before interest, income taxes,
depreciation and amortization 57,830 45,165
--------- ---------
EBITDA as a percent of revenues: 21% 22%
========= =========
CONTACT: First Cash Financial Services, Inc., Arlington
Rick Wessel, 817-505-3199
Vice Chairman & Chief Executive Officer
or
Doug Orr, 817-505-3199
Executive Vice President & Chief Financial Officer
investorrelations@firstcash.com
www.firstcash.com