QC Holdings, Inc. (NASDAQ: QCCO) reported income from continuing operations of $1.6 million and revenues of $46.5 million for the quarter ended June 30, 2010. For the six months ended June 30, 2010, income from continuing operations totaled $7.1 million and revenues reached $95.2 million.
“Our second quarter results reflect the negative effects of legislative changes in several states, including Washington, South Carolina, Virginia and Kentucky,” said QC Chairman and Chief Executive Officer Don Early. “We continue to look for alternative products and services to provide to our customers in these states, but the numerous restrictions included in the laws impose constraints that are very difficult to profitably overcome.
“With respect to those states where there have been no recent regulatory and legislative effects, our loan volumes continued to be soft compared to prior year, likely tied to the uncertain economic recovery, high unemployment rate and the lack of growth in broader consumer spending.”
For the three and six months ended June 30, 2009, income from continuing operations totaled $4.5 million and $11.0 million, respectively, and revenues were $51.3 million and $105.6 million, respectively.
The three and six months ended June 30, 2010 and 2009 include discontinued operations relating to branches that were closed during each period. Schedules reconciling adjusted EBITDA to income from continuing operations for the three and six months ended June 30, 2010 and 2009 are provided below.
** Second Quarter **
Revenues decreased 9.4% quarter-to-quarter. This decline is primarily due to reduced payday and installment loan volumes from unfavorable law changes effective January 1, 2010 in Washington and South Carolina that restrict customer access to payday loans. Another component of the decline relates to Virginia, where the company discontinued its open-end credit product offering during second quarter 2009 and re-introduced the payday loan product. The payday loan volumes in Virginia have not returned to historical levels, largely due to the various restrictions on customer borrowing contained in the existing law. A $1.5 million improvement in automotive sales and interest revenues partially offset these declines.