EZCORP, Inc. (NASDAQ: EZPW), a leading provider of pawn
transactions in the United States and Latin America, today
announced results for its first quarter ended December 31,
2023.
Unless otherwise noted, all amounts in this release are in
conformity with U.S. generally accepted accounting principles
(“GAAP”) and comparisons shown are to the same period in the prior
year.
FIRST QUARTER HIGHLIGHTS
- Net income increased to $28.5 million,
an increase of $11.7 million, or 70%. On an adjusted basis1, net
income increased $6.6 million or 30%.
- Diluted earnings per share of
$0.36, up from $0.25. On an adjusted basis,
diluted earnings per share of $0.36, compared to
$0.28.
- Total revenues and gross profit
increased 13%.
- Merchandise sales gross margin remains
within our targeted range at 36%.
- Pawn loans outstanding (PLO) up 16% to
$243.3 million.
- Return on earning assets (ROEA) remains
strong at 165%.
CEO COMMENTARY AND OUTLOOK
Lachie Given, Chief Executive Officer, stated, “We began fiscal
2024 with another outstanding quarter. Our PLO was the highest on
record in our first quarter, and total revenues were the highest
for any quarter in our history. The challenging macro-economic
backdrop continues to drive increased demand for our two core
products, which are satisfying the short term cash needs of our
customers and selling pre-owned and recycled goods.
“We remain committed to market-leading customer service in the
neighborhoods in which we serve. We continue to invest in our team
members, technology, process efficiencies and automation, to
provide fast, convenient and respectful cash solutions and
affordable pre-owned and recycled jewelry and general merchandise
to cost-conscious and environmentally concerned consumers. This
consistent service to our customers and investment in our teams and
technology continue to produce outstanding operating and financial
results for our shareholders.
“During the first quarter, we also acquired one store in Texas
and opened five de novo stores in Latin America. In Guatemala, we
added 3 stores, expanding our market leadership there with a total
of 120 stores, and in Mexico, we added 2 stores. We now have a
total of 1,237 stores across the organization and over 7,700 team
members. Our strong balance sheet and cash liquidity enable us to
capitalize upon potential growth opportunities in a disciplined
way.
“MaxPawn, the luxury pawnbroking business we acquired in
December 2022, had a strong 2023 holiday season. While still a
small part of the business, MaxPawn and the luxury category as a
whole represent an exciting component of our future.
“We now have 4.2 million EZ+ Rewards members across all
geographies, an increase of 75% over the first quarter of 2023 and
11% over last quarter. We are focused on driving increased
engagement with this large customer set as we seek to increase
market share and share of wallet in all of the neighborhoods in
which we serve.
“We are committed to doing everything we can to retain and
incentivize our passionate, engaged and productive team members
because it is their operational excellence and superior customer
service that drive our financial results and ultimately enhance
value for all shareholders. We are proud to have also been
recognized during the quarter by Newsweek as one of America’s
Greatest Workplaces for Diversity 2024.
“Thank you to all EZCORP team members for an exceptional quarter
of operating and financial results to commence the 2024 fiscal
year.” concluded Given.
CONSOLIDATED RESULTS
Three Months
Ended December 31 |
As Reported |
|
Adjusted1 |
in millions, except per share amounts |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
|
Total revenues |
$ |
300.0 |
|
$ |
264.3 |
|
$ |
292.9 |
|
$ |
264.3 |
Gross profit |
$ |
172.6 |
|
$ |
152.5 |
|
$ |
168.8 |
|
$ |
152.5 |
Income before tax |
$ |
37.7 |
|
$ |
24.5 |
|
$ |
37.2 |
|
$ |
28.3 |
Net income |
$ |
28.5 |
|
$ |
16.8 |
|
$ |
28.2 |
|
$ |
21.6 |
Diluted earnings per
share |
$ |
0.36 |
|
$ |
0.25 |
|
$ |
0.36 |
|
$ |
0.28 |
EBITDA (non-GAAP measure) |
$ |
47.1 |
|
$ |
38.1 |
|
$ |
46.4 |
|
$ |
38.3 |
- Diluted earnings per share of $0.36, up from $0.25. On an
adjusted basis, diluted earnings per share of $0.36, up
from $0.28.
- Income before taxes was
$37.7 million, up from $24.5 million, and adjusted EBITDA
increased 21% to $46.4 million.
- PLO increased 16% to $243.3 million, up
$33.4 million. On a same-store basis2, PLO increased 14% due
to improved operational performance and continued strong pawn
demand.
- Total revenues and gross profit
increased 13%, reflecting improved pawn service charge (PSC)
revenues, merchandise sales and merchandise sales gross
profit.
- PSC increased 15% as a result of higher
average PLO.
- Merchandise sales gross margin remains
within our target range at 36%. Aged general merchandise was 1.3%
of total general merchandise inventory.
- Net inventory increased 6%, as
expected with the growth in PLO. Inventory turnover increased to
3.0x, from 2.8x.
- Store expenses increased 10%, primarily
due to increased labor in-line with store activity, higher store
count and rent. On a same-store basis, store expenses increased
7%.
- General and administrative expenses
increased 7%, primarily due to annual salary increases and an
increase in costs related to the implementation of Workday.
- Cash and cash equivalents at
the end of the quarter was $218.5 million, up 5% year-over-year.
The increase was primarily due to cash inflows provided by
operating activities offset by the increase in PLO and inventory,
strategic investments, share repurchases, and the acquisition of
new stores.
SEGMENT RESULTS
U.S. Pawn
- PLO ended the quarter at $190.8
million, up 14% or 13% on a same store basis.
- Total revenues was up 12% and gross
profit increased 10%, reflecting increased PSC and higher
merchandise sales.
- PSC increased 14% as a result
of higher average PLO.
- Merchandise sales increased 6% and
gross margin decreased to 37% from 38%. Aged general merchandise
was 1.1% of total general merchandise inventory.
- Net inventory increased 8%, as
expected with the growth in PLO. Inventory turnover increased to
2.7x from 2.6x.
- Store expenses increased 5%, primarily
due to wage inflationary pressures, higher store count and, to a
lesser extent, rent.
- Segment contribution increased 21%
to $47.5 million.
- Segment store count increased by 1
store during the quarter due to an acquisition.
Latin America Pawn
- PLO improved to $52.5 million, up
22% (11% on constant currency basis). On a same store basis, PLO
increased 19% (8% on a constant currency basis).
- Total revenues was up 19% (9% on
constant currency basis) and gross profit increased 22% (11% on a
constant currency basis), reflecting increased PSC, higher
merchandise sales and improved merchandise sales gross profit.
- PSC increased 18% (8% on a constant
currency basis) as a result of higher average PLO.
- Merchandise sales gross margin
increased from 30% to 32%. Aged general merchandise was 1.6% of
total merchandise inventory.
- Net inventory remained flat
(decreased 11% on a constant currency basis) due to PLO growth,
offset by increased inventory turnover at 3.8x, up from 3.3x.
- Store expenses increased 21% (10% on a
constant currency basis), primarily due to increases in minimum
wage and headcount, higher store count and, to a lesser extent,
rent. Same-store expenses increased 16% (6% on a constant currency
basis).
- Segment contribution increased 35% (27%
on a constant currency basis). On an adjusted basis, segment
contribution was up 24% to $9.6 million.
- Segment store count increased by 5 de
novo stores opened during the quarter.
FORM 10-Q
EZCORP’s Quarterly Report on Form 10-Q for the quarter ended
December 31, 2023 has been filed with the Securities and
Exchange Commission. The report is available in the Investor
Relations section of the Company’s website at
http://investors.ezcorp.com.
CONFERENCE CALL
EZCORP will host a conference call on Thursday,
February 1, 2024, at 8:00 am Central Time to discuss
First Quarter Fiscal 2024 results. Analysts and institutional
investors may participate on the conference call by registering
online at: https://edge.media-server.com/mmc/p/iic4zjrc/. Once
registered you will receive the dial-in details with a unique PIN
to join the call. The conference call will be webcast
simultaneously to the public through this
link: http://investors.ezcorp.com. A replay of the conference
call will be available online
at http://investors.ezcorp.com shortly after the end of
the call.
ABOUT EZCORP
Formed in 1989, EZCORP has grown into a leading provider of pawn
transactions in the United States and Latin America. We also sell
pre-owned and recycled merchandise, primarily collateral forfeited
from pawn lending operations and merchandise purchased from
customers. We are dedicated to satisfying the short-term cash needs
of consumers who are both cash and credit constrained, focusing on
an industry-leading customer experience. EZCORP is traded on NASDAQ
under the symbol EZPW and is a member of the S&P 1000 Index and
Nasdaq Composite Index.
Follow us on social media:
Facebook EZPAWN Official
https://www.facebook.com/EZPAWN/
EZCORP Instagram Official
https://www.instagram.com/ezcorp_official/
EZPAWN Instagram Official
https://www.instagram.com/ezpawnofficial/
EZCORP LinkedIn
https://www.linkedin.com/company/ezcorp/
FORWARD LOOKING STATEMENTS
This announcement contains certain forward-looking statements
regarding the Company’s strategy, initiatives and expected
performance. These statements are based on the Company’s current
expectations as to the outcome and timing of future events. All
statements, other than statements of historical facts, including
all statements regarding the Company's strategy, initiatives and
future performance, that address activities or results that the
Company plans, expects, believes, projects, estimates or
anticipates, will, should or may occur in the future, including
future financial or operating results, are forward-looking
statements. Actual results for future periods may differ materially
from those expressed or implied by these forward-looking statements
due to a number of uncertainties and other factors, including
operating risks, liquidity risks, legislative or regulatory
developments, market factors, current or future litigation and
risks associated with the COVID-19 pandemic. For a discussion of
these and other factors affecting the Company’s business and
prospects, see the Company’s annual, quarterly and other reports
filed with the Securities and Exchange Commission. The Company
undertakes no obligation to update or revise forward-looking
statements to reflect changed assumptions, the occurrence of
unanticipated events or changes to future operating results over
time.
Contact:Email:
Investor_Relations@ezcorp.com Phone: (512) 314-2220
Note: Percentages are calculated from the underlying numbers in
thousands and, as a result, may not agree to the percentages
calculated from numbers in millions.1“Adjusted” basis, which is a
non-GAAP measure, excludes certain items. “Constant currency”
basis, which is a non-GAAP measure, excludes the impact of foreign
currency exchange rate fluctuations. For additional information
about these calculations, as well as a reconciliation to the most
comparable GAAP financial measures, see “Non-GAAP Financial
Information” at the end of this release.2“Same Store” basis, which
is a financial measure, includes stores open the entirety of the
comparable periods.
EZCORP, Inc.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(Unaudited) |
|
|
Three Months EndedDecember
31, |
(in thousands, except per share amounts) |
|
2023 |
|
|
|
2022 |
|
Revenues: |
|
|
|
Merchandise sales |
$ |
179,403 |
|
|
$ |
163,787 |
|
Jewelry scrapping sales |
|
14,082 |
|
|
|
7,884 |
|
Pawn service charges |
|
106,449 |
|
|
|
92,593 |
|
Other revenues |
|
57 |
|
|
|
63 |
|
Total revenues |
|
299,991 |
|
|
|
264,327 |
|
Merchandise cost of goods
sold |
|
115,210 |
|
|
|
104,877 |
|
Jewelry scrapping cost of
goods sold |
|
12,208 |
|
|
|
6,953 |
|
Gross profit |
|
172,573 |
|
|
|
152,497 |
|
Operating expenses: |
|
|
|
Store expenses |
|
110,555 |
|
|
|
100,803 |
|
General and administrative |
|
16,543 |
|
|
|
15,476 |
|
Depreciation and amortization |
|
8,565 |
|
|
|
7,988 |
|
Gain on sale or disposal of
assets and other |
|
(172 |
) |
|
|
(16 |
) |
Total operating expenses |
|
135,491 |
|
|
|
124,251 |
|
Operating income |
|
37,082 |
|
|
|
28,246 |
|
Interest expense |
|
3,440 |
|
|
|
6,190 |
|
Interest income |
|
(2,639 |
) |
|
|
(664 |
) |
Equity in net income of
unconsolidated affiliates |
|
(1,153 |
) |
|
|
(1,584 |
) |
Other income |
|
(271 |
) |
|
|
(234 |
) |
Income before income taxes |
|
37,705 |
|
|
|
24,538 |
|
Income
tax expense |
|
9,235 |
|
|
|
7,760 |
|
Net income |
$ |
28,470 |
|
|
$ |
16,778 |
|
|
|
|
|
Basic earnings per share |
$ |
0.52 |
|
|
$ |
0.30 |
|
Diluted earnings per
share |
$ |
0.36 |
|
|
$ |
0.25 |
|
|
|
|
|
Weighted-average basic shares
outstanding |
|
55,076 |
|
|
|
56,308 |
|
Weighted-average diluted
shares outstanding |
|
86,812 |
|
|
|
83,779 |
|
EZCORP, Inc.CONDENSED CONSOLIDATED BALANCE
SHEETS(Unaudited) |
|
|
|
|
|
|
(in thousands, except share
and per share amounts) |
December 31,2023 |
|
December 31,2022 |
|
September 30,2023 |
|
|
|
|
|
|
Assets: |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents |
$ |
218,516 |
|
|
$ |
207,658 |
|
|
$ |
220,595 |
|
Restricted cash |
|
8,470 |
|
|
|
8,359 |
|
|
|
8,373 |
|
Pawn loans |
|
243,252 |
|
|
|
209,855 |
|
|
|
245,766 |
|
Pawn service charges receivable, net |
|
40,002 |
|
|
|
34,921 |
|
|
|
38,885 |
|
Inventory, net |
|
164,927 |
|
|
|
156,064 |
|
|
|
166,477 |
|
Prepaid expenses and other current assets |
|
44,001 |
|
|
|
45,559 |
|
|
|
39,623 |
|
Total current assets |
|
719,168 |
|
|
|
662,416 |
|
|
|
719,719 |
|
Investments in unconsolidated affiliates |
|
10,125 |
|
|
|
37,789 |
|
|
|
10,987 |
|
Other investments |
|
51,220 |
|
|
|
39,220 |
|
|
|
36,220 |
|
Property and equipment, net |
|
68,998 |
|
|
|
55,612 |
|
|
|
68,096 |
|
Right-of-use assets, net |
|
231,103 |
|
|
|
229,991 |
|
|
|
234,388 |
|
Goodwill |
|
303,799 |
|
|
|
297,361 |
|
|
|
302,372 |
|
Intangible assets, net |
|
56,977 |
|
|
|
58,029 |
|
|
|
58,216 |
|
Notes receivable, net |
|
— |
|
|
|
1,224 |
|
|
|
— |
|
Deferred tax asset, net |
|
25,984 |
|
|
|
12,428 |
|
|
|
25,702 |
|
Other assets, net |
|
13,819 |
|
|
|
8,245 |
|
|
|
12,011 |
|
Total assets |
$ |
1,481,193 |
|
|
$ |
1,402,315 |
|
|
$ |
1,467,711 |
|
|
|
|
|
|
|
Liabilities and equity: |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Current maturities of long-term debt, net |
$ |
34,307 |
|
|
$ |
— |
|
|
$ |
34,265 |
|
Accounts payable, accrued expenses and other current
liabilities |
|
69,386 |
|
|
|
69,930 |
|
|
$ |
81,605 |
|
Customer layaway deposits |
|
18,324 |
|
|
|
16,276 |
|
|
|
18,920 |
|
Operating lease liabilities, current |
|
57,980 |
|
|
|
52,799 |
|
|
|
57,182 |
|
Total current liabilities |
|
179,997 |
|
|
|
139,005 |
|
|
|
191,972 |
|
Long-term debt, net |
|
326,223 |
|
|
|
358,984 |
|
|
|
325,847 |
|
Deferred tax liability, net |
|
372 |
|
|
|
— |
|
|
|
435 |
|
Operating lease liabilities |
|
188,475 |
|
|
|
188,730 |
|
|
|
193,187 |
|
Other long-term liabilities |
|
11,243 |
|
|
|
10,261 |
|
|
|
10,502 |
|
Total liabilities |
|
706,310 |
|
|
|
696,980 |
|
|
|
721,943 |
|
Commitments and contingencies (Note 9) |
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
Class A Non-voting Common Stock, par value $0.01 per share;
shares authorized: 100 million; issued and outstanding : 52,272,594
as of December 31, 2023; 52,877,930 as of December 31,
2022; and 51,869,569 as of September 30, 2023 |
|
523 |
|
|
|
529 |
|
|
|
519 |
|
Class B Voting Common Stock, convertible, par value $0.01 per
share; shares authorized: 3 million; issued and outstanding:
2,970,171 |
|
30 |
|
|
|
30 |
|
|
|
30 |
|
Additional paid-in capital |
|
343,870 |
|
|
|
343,012 |
|
|
|
346,181 |
|
Retained earnings |
|
457,929 |
|
|
|
414,929 |
|
|
|
431,140 |
|
Accumulated other comprehensive loss |
|
(27,469 |
) |
|
|
(53,165 |
) |
|
|
(32,102 |
) |
Total equity |
|
774,883 |
|
|
|
705,335 |
|
|
|
745,768 |
|
Total liabilities and equity |
$ |
1,481,193 |
|
|
$ |
1,402,315 |
|
|
$ |
1,467,711 |
|
EZCORP, Inc.CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS(Unaudited) |
|
|
Three Months
EndedDecember 31, |
(in thousands) |
|
2023 |
|
|
|
2022 |
|
|
|
Operating activities: |
|
|
|
Net income |
$ |
28,470 |
|
|
$ |
16,778 |
|
Adjustments to reconcile net income to net cash flows from
operating activities: |
|
|
|
Depreciation and amortization |
|
8,565 |
|
|
|
7,988 |
|
Amortization of debt discount and deferred financing costs |
|
417 |
|
|
|
378 |
|
Non-cash lease expense |
|
14,744 |
|
|
|
13,596 |
|
Deferred income taxes |
|
345 |
|
|
|
656 |
|
Other adjustments |
|
(857 |
) |
|
|
(91 |
) |
Provision for inventory reserve |
|
(156 |
) |
|
|
532 |
|
Stock compensation expense |
|
2,264 |
|
|
|
1,886 |
|
Equity in net income from investment in unconsolidated
affiliates |
|
(1,153 |
) |
|
|
(1,584 |
) |
Net loss on extinguishment of debt |
|
— |
|
|
|
3,545 |
|
Changes in operating assets and liabilities, net of business
acquisitions: |
|
|
|
Pawn service charges receivable |
|
(1,000 |
) |
|
|
(691 |
) |
Inventory |
|
2,066 |
|
|
|
(1,881 |
) |
Prepaid expenses, other current assets and other assets |
|
(5,823 |
) |
|
|
(2,280 |
) |
Accounts payable, accrued expenses and other liabilities |
|
(33,991 |
) |
|
|
(34,761 |
) |
Customer layaway deposits |
|
(719 |
) |
|
|
(752 |
) |
Income taxes |
|
8,309 |
|
|
|
6,574 |
|
Dividends from unconsolidated affiliates |
|
— |
|
|
|
1,775 |
|
Net cash provided by operating activities |
|
21,481 |
|
|
|
11,668 |
|
Investing activities: |
|
|
|
Loans made |
|
(216,978 |
) |
|
|
(189,074 |
) |
Loans repaid |
|
123,021 |
|
|
|
109,125 |
|
Recovery of pawn loan principal through sale of forfeited
collateral |
|
98,209 |
|
|
|
88,030 |
|
Capital expenditures, net |
|
(7,184 |
) |
|
|
(7,182 |
) |
Acquisitions, net of cash acquired |
|
(677 |
) |
|
|
(12,884 |
) |
Issuance of notes receivable |
|
— |
|
|
|
(15,500 |
) |
Investment in unconsolidated affiliate |
|
— |
|
|
|
(2,133 |
) |
Investment in other investments |
|
(15,000 |
) |
|
|
(15,000 |
) |
Dividends from unconsolidated affiliates |
|
1,745 |
|
|
|
— |
|
Net cash used in investing activities |
|
(16,864 |
) |
|
|
(44,618 |
) |
Financing activities: |
|
|
|
Taxes paid related to net share settlement of equity awards |
|
(3,253 |
) |
|
|
(1,138 |
) |
Proceeds from issuance of debt |
|
— |
|
|
|
230,000 |
|
Debt issuance cost |
|
— |
|
|
|
(7,403 |
) |
Cash paid on extinguishment of debt |
|
— |
|
|
|
(1,951 |
) |
Payments on debt |
|
— |
|
|
|
(178,488 |
) |
Purchase and retirement of treasury stock |
|
(3,007 |
) |
|
|
(7,027 |
) |
Payments of finance leases |
|
(132 |
) |
|
|
— |
|
Net cash (used in) provided by financing activities |
|
(6,392 |
) |
|
|
33,993 |
|
Effect
of exchange rate changes on cash and cash equivalents and
restricted cash |
|
(207 |
) |
|
|
605 |
|
Net (decrease) increase in cash, cash equivalents and restricted
cash |
|
(1,982 |
) |
|
|
1,648 |
|
Cash
and cash equivalents and restricted cash at beginning of
period |
|
228,968 |
|
|
|
214,369 |
|
Cash and cash equivalents and restricted cash at end of period |
$ |
226,986 |
|
|
$ |
216,017 |
|
|
|
|
|
EZCORP, Inc.OPERATING SEGMENT RESULTS |
|
|
Three Months Ended December 31,
2023(Unaudited) |
(in thousands) |
U.S. Pawn |
|
Latin America Pawn |
|
Other Investments |
|
Total Segments |
|
Corporate Items |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Merchandise sales |
$ |
125,513 |
|
$ |
53,890 |
|
|
$ |
— |
|
|
$ |
179,403 |
|
|
$ |
— |
|
|
$ |
179,403 |
|
Jewelry scrapping sales |
|
12,815 |
|
|
1,267 |
|
|
|
— |
|
|
|
14,082 |
|
|
|
— |
|
|
|
14,082 |
|
Pawn service charges |
|
79,073 |
|
|
27,376 |
|
|
|
— |
|
|
|
106,449 |
|
|
|
— |
|
|
|
106,449 |
|
Other revenues |
|
37 |
|
|
16 |
|
|
|
4 |
|
|
|
57 |
|
|
|
— |
|
|
|
57 |
|
Total revenues |
|
217,438 |
|
|
82,549 |
|
|
|
4 |
|
|
|
299,991 |
|
|
|
— |
|
|
|
299,991 |
|
Merchandise cost of goods
sold |
|
78,709 |
|
|
36,501 |
|
|
|
— |
|
|
|
115,210 |
|
|
|
— |
|
|
|
115,210 |
|
Jewelry scrapping cost of
goods sold |
|
11,284 |
|
|
924 |
|
|
|
— |
|
|
|
12,208 |
|
|
|
— |
|
|
|
12,208 |
|
Gross profit |
|
127,445 |
|
|
45,124 |
|
|
|
4 |
|
|
|
172,573 |
|
|
|
— |
|
|
|
172,573 |
|
Segment and corporate expenses
(income): |
|
|
|
|
|
|
|
|
|
|
|
Store expenses |
|
77,255 |
|
|
33,300 |
|
|
|
— |
|
|
|
110,555 |
|
|
|
— |
|
|
|
110,555 |
|
General and administrative |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
16,543 |
|
|
|
16,543 |
|
Depreciation and amortization |
|
2,624 |
|
|
2,339 |
|
|
|
— |
|
|
|
4,963 |
|
|
|
3,602 |
|
|
|
8,565 |
|
Loss (gain) on sale or disposal of assets and other |
|
26 |
|
|
(196 |
) |
|
|
— |
|
|
|
(170 |
) |
|
|
(2 |
) |
|
|
(172 |
) |
Interest expense |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,440 |
|
|
|
3,440 |
|
Interest income |
|
— |
|
|
(420 |
) |
|
|
(573 |
) |
|
|
(993 |
) |
|
|
(1,646 |
) |
|
|
(2,639 |
) |
Equity in net income of unconsolidated affiliates |
|
— |
|
|
— |
|
|
|
(1,153 |
) |
|
|
(1,153 |
) |
|
|
— |
|
|
|
(1,153 |
) |
Other (income) expense |
|
— |
|
|
(48 |
) |
|
|
1 |
|
|
|
(47 |
) |
|
|
(224 |
) |
|
|
(271 |
) |
Segment contribution |
$ |
47,540 |
|
$ |
10,149 |
|
|
$ |
1,729 |
|
|
$ |
59,418 |
|
|
|
|
|
Income (loss) before income taxes |
|
|
|
|
|
|
$ |
59,418 |
|
|
$ |
(21,713 |
) |
|
$ |
37,705 |
|
|
Three Months Ended December 31,
2022(Unaudited) |
(in thousands) |
U.S. Pawn |
|
Latin America Pawn |
|
Other Investments |
|
Total Segments |
|
Corporate Items |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Merchandise sales |
$ |
118,314 |
|
$ |
45,473 |
|
|
$ |
— |
|
|
$ |
163,787 |
|
|
$ |
— |
|
|
$ |
163,787 |
|
Jewelry scrapping sales |
|
7,176 |
|
|
708 |
|
|
|
— |
|
|
|
7,884 |
|
|
|
— |
|
|
|
7,884 |
|
Pawn service charges |
|
69,310 |
|
|
23,283 |
|
|
|
— |
|
|
|
92,593 |
|
|
|
— |
|
|
|
92,593 |
|
Other revenues |
|
25 |
|
|
16 |
|
|
|
22 |
|
|
|
63 |
|
|
|
— |
|
|
|
63 |
|
Total revenues |
|
194,825 |
|
|
69,480 |
|
|
|
22 |
|
|
|
264,327 |
|
|
|
— |
|
|
|
264,327 |
|
Merchandise cost of goods
sold |
|
73,256 |
|
|
31,621 |
|
|
|
— |
|
|
|
104,877 |
|
|
|
— |
|
|
|
104,877 |
|
Jewelry scrapping cost of
goods sold |
|
6,216 |
|
|
737 |
|
|
|
— |
|
|
|
6,953 |
|
|
|
— |
|
|
|
6,953 |
|
Gross profit |
|
115,353 |
|
|
37,122 |
|
|
|
22 |
|
|
|
152,497 |
|
|
|
— |
|
|
|
152,497 |
|
Segment and corporate expenses
(income): |
|
|
|
|
|
|
|
|
|
|
|
Store expenses |
|
73,304 |
|
|
27,499 |
|
|
|
— |
|
|
|
100,803 |
|
|
|
— |
|
|
|
100,803 |
|
General and administrative |
|
— |
|
|
(3 |
) |
|
|
— |
|
|
|
(3 |
) |
|
|
15,479 |
|
|
|
15,476 |
|
Depreciation and amortization |
|
2,755 |
|
|
2,215 |
|
|
|
— |
|
|
|
4,970 |
|
|
|
3,018 |
|
|
|
7,988 |
|
Loss (gain) on sale or disposal of assets and other |
|
3 |
|
|
(19 |
) |
|
|
— |
|
|
|
(16 |
) |
|
|
— |
|
|
|
(16 |
) |
Interest expense |
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6,190 |
|
|
|
6,190 |
|
Interest income |
|
— |
|
|
(169 |
) |
|
|
— |
|
|
|
(169 |
) |
|
|
(495 |
) |
|
|
(664 |
) |
Equity in net income of unconsolidated affiliates |
|
— |
|
|
— |
|
|
|
(1,584 |
) |
|
|
(1,584 |
) |
|
|
— |
|
|
|
(1,584 |
) |
Other expense (income) |
|
— |
|
|
70 |
|
|
|
4 |
|
|
|
74 |
|
|
|
(308 |
) |
|
|
(234 |
) |
Segment contribution |
$ |
39,291 |
|
$ |
7,529 |
|
|
$ |
1,602 |
|
|
$ |
48,422 |
|
|
|
|
|
Income (loss) before income taxes |
|
|
|
|
|
|
$ |
48,422 |
|
|
$ |
(23,884 |
) |
|
$ |
24,538 |
|
|
|
|
|
|
|
|
|
|
|
|
|
EZCORP, Inc.STORE COUNT
ACTIVITY(Unaudited) |
|
|
Three Months Ended December 31,
2023 |
|
U.S. Pawn |
|
Latin America Pawn |
|
Consolidated |
|
|
|
|
|
|
|
|
As of September 30,
2023 |
529 |
|
702 |
|
|
1,231 |
|
New locations opened |
— |
|
5 |
|
|
5 |
|
Locations acquired |
1 |
|
— |
|
|
1 |
|
As of December 31, 2023 |
530 |
|
707 |
|
|
1,237 |
|
|
Three Months Ended December 31,
2022 |
|
U.S. Pawn |
|
Latin America Pawn |
|
Consolidated |
|
|
|
|
|
|
As
of September 30, 2022 |
515 |
|
660 |
|
|
1,175 |
|
New locations opened |
— |
|
2 |
|
|
2 |
|
Locations acquired |
10 |
|
— |
|
|
10 |
|
Locations sold, combined or closed |
— |
|
(1 |
) |
|
(1 |
) |
As of December 31, 2022 |
525 |
|
661 |
|
|
1,186 |
|
Non-GAAP Financial Information (Unaudited)
In addition to the financial information prepared in conformity
with accounting U.S. generally accepted accounting principles
(“GAAP”), we provide certain other non-GAAP financial information
on a constant currency (“constant currency”) and adjusted basis. We
use constant currency results to evaluate our Latin America Pawn
operations, which are denominated primarily in Mexican pesos,
Guatemalan quetzales and other Latin American currencies. We
believe that presentation of constant currency and adjusted results
is meaningful and useful in understanding the activities and
business metrics of our operations and reflect an additional way of
viewing aspects of our business that, when viewed with GAAP
results, provide a more complete understanding of factors and
trends affecting our business. We provide non-GAAP financial
information for informational purposes and to enhance understanding
of our GAAP consolidated financial statements. We use this non-GAAP
financial information primarily to evaluate and compare operating
results across accounting periods.
Readers should consider the information in addition to, but not
instead of or superior to, our financial statements prepared in
accordance with GAAP. This non-GAAP financial information may be
determined or calculated differently by other companies, limiting
the usefulness of those measures for comparative purposes.
Constant currency results reported herein are calculated by
translating consolidated balance sheet and consolidated statement
of operations items denominated in local currency to U.S. dollars
using the exchange rate from the prior-year comparable period, as
opposed to the current period, in order to exclude the effects of
foreign currency rate fluctuations. In addition, we have an equity
method investment that is denominated in Australian dollars and is
translated into U.S. dollars. We used the end-of-period rate for
balance sheet items and the average closing daily exchange rate on
a monthly basis during the appropriate period for statement of
operations items. The end-of-period and approximate average
exchange rates for each applicable currency as compared to U.S.
dollars as of and for the three months ended December 31,
2023 and 2022 were as follows:
|
|
December 31, |
|
Three Months EndedDecember
31, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
|
|
|
|
|
|
|
Mexican peso |
|
17.0 |
|
19.5 |
|
17.5 |
|
19.7 |
Guatemalan quetzal |
|
7.7 |
|
7.7 |
|
7.6 |
|
7.7 |
Honduran lempira |
|
24.3 |
|
24.4 |
|
24.4 |
|
24.3 |
Australian dollar |
|
1.5 |
|
1.5 |
|
1.5 |
|
1.5 |
Our statement of operations constant currency results reflect
the monthly exchange rate fluctuations and so are not directly
calculable from the above rates. Constant currency results, where
presented, also exclude the foreign currency gain or loss.
Miscellaneous Non-GAAP Financial Measures
|
Three Months EndedDecember
31, |
(in millions) |
|
2023 |
|
|
|
2022 |
|
|
|
|
|
Net income |
$ |
28.5 |
|
|
$ |
16.8 |
|
Interest expense |
|
3.4 |
|
|
|
6.2 |
|
Interest income |
|
(2.6 |
) |
|
|
(0.7 |
) |
Income tax expense |
|
9.2 |
|
|
|
7.8 |
|
Depreciation and amortization |
|
8.6 |
|
|
|
8.0 |
|
EBITDA |
$ |
47.1 |
|
|
$ |
38.1 |
|
|
TotalRevenues |
|
GrossProfit |
|
IncomeBefore Tax |
|
Tax Effect |
|
NetIncome |
|
Diluted EPS |
|
EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 Q1 Reported |
$ |
300.0 |
|
|
$ |
172.6 |
|
|
$ |
37.7 |
|
|
$ |
9.2 |
|
|
$ |
28.5 |
|
|
$ |
0.36 |
|
$ |
47.1 |
|
FX Impact |
|
— |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
|
0.1 |
|
|
|
— |
|
|
0.1 |
|
Constant Currency and other
impact |
|
(7.1 |
) |
|
|
(3.8 |
) |
|
|
(0.6 |
) |
|
|
(0.2 |
) |
|
|
(0.4 |
) |
|
|
— |
|
|
(0.8 |
) |
2024 Q1 Adjusted |
$ |
292.9 |
|
|
$ |
168.8 |
|
|
$ |
37.2 |
|
|
$ |
9.0 |
|
|
$ |
28.2 |
|
|
$ |
0.36 |
|
$ |
46.4 |
|
|
TotalRevenues |
|
GrossProfit |
|
IncomeBefore Tax |
|
Tax Effect |
|
NetIncome |
|
Diluted EPS |
|
EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 Q1 Reported |
$ |
264.3 |
|
|
$ |
152.5 |
|
|
$ |
24.5 |
|
|
$ |
7.8 |
|
|
$ |
16.8 |
|
|
$ |
0.25 |
|
$ |
38.1 |
|
Extinguishment of Debt
Impact |
|
— |
|
|
|
— |
|
|
|
3.5 |
|
|
|
(1.0 |
) |
|
|
4.5 |
|
|
|
0.03 |
|
|
— |
|
FX Impact |
|
— |
|
|
|
— |
|
|
|
0.3 |
|
|
|
(0.1 |
) |
|
|
0.3 |
|
|
|
— |
|
|
0.2 |
|
2023 Q1 Adjusted |
$ |
264.3 |
|
|
$ |
152.5 |
|
|
$ |
28.3 |
|
|
$ |
6.7 |
|
|
$ |
21.6 |
|
|
$ |
0.28 |
|
$ |
38.3 |
|
|
Three Months EndedDecember 31,
2023 |
(in millions) |
U.S. Dollar Amount |
|
Percentage Change YOY |
|
|
|
|
Consolidated revenues |
$ |
300.0 |
|
|
13 |
% |
Currency exchange rate fluctuations |
|
(7.1 |
) |
|
|
Constant currency consolidated revenues |
$ |
292.9 |
|
|
11 |
% |
|
|
|
|
Consolidated gross profit |
$ |
172.6 |
|
|
13 |
% |
Currency exchange rate fluctuations |
|
(3.8 |
) |
|
|
Constant currency consolidated gross profit |
$ |
168.8 |
|
|
11 |
% |
|
|
|
|
Consolidated net
inventory |
$ |
164.9 |
|
|
6 |
% |
Currency exchange rate fluctuations |
|
(4.0 |
) |
|
|
Constant currency consolidated net inventory |
$ |
160.9 |
|
|
3 |
% |
|
|
|
|
Latin America Pawn gross
profit |
$ |
45.1 |
|
|
22 |
% |
Currency exchange rate fluctuations |
|
(3.8 |
) |
|
|
Constant currency Latin America Pawn gross profit |
$ |
41.3 |
|
|
11 |
% |
|
|
|
|
Latin America Pawn PLO |
$ |
52.5 |
|
|
22 |
% |
Currency exchange rate fluctuations |
|
(4.9 |
) |
|
|
Constant currency Latin America Pawn PLO |
$ |
47.6 |
|
|
11 |
% |
|
|
|
|
Latin America Pawn PSC
revenues |
$ |
27.4 |
|
|
18 |
% |
Currency exchange rate fluctuations |
|
(2.2 |
) |
|
|
Constant currency Latin America Pawn PSC revenues |
$ |
25.2 |
|
|
8 |
% |
|
|
|
|
Latin America Pawn merchandise
sales |
$ |
53.9 |
|
|
19 |
% |
Currency exchange rate fluctuations |
|
(4.8 |
) |
|
|
Constant currency Latin America Pawn merchandise sales |
$ |
49.1 |
|
|
8 |
% |
|
|
|
|
Latin America Pawn segment
profit before tax |
$ |
10.1 |
|
|
35 |
% |
Currency exchange rate fluctuations |
|
(0.7 |
) |
|
|
Constant currency Latin America Pawn segment profit before tax |
$ |
9.4 |
|
|
26 |
% |
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