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Cash America Announces Third Quarter Net Income And Dividend Declared

CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS
(dollars in thousands, except per share data)
(Unaudited)
Three Months Ended   Nine Months Ended
September 30, September 30,
2012   2011 2012   2011
 
Consolidated Operations:
Total revenue $ 439,694 $ 398,304 $ 1,308,826 $ 1,109,107
Net revenue 248,477 235,454 738,869 661,430
Total expenses   208,289     172,289     572,442     485,213
 
Income from Operations $ 40,188 $ 63,165 $ 166,427 $ 176,217
 
Income before income taxes   33,046     55,503     145,160     156,838
 
Net Income $ 7,930   $ 34,529   $ 77,673   $ 97,561
 
Net loss attributable to the noncontrolling interest   3,773     248     5,317     575
 
Net Income Attributable to Cash America International, Inc. $ 11,703   $ 34,777   $ 82,990   $ 98,136
 
Earnings per share:
Net Income attributable to Cash America International, Inc.

common shareholders:

Basic $ 0.40 $ 1.18 $ 2.80 $ 3.31
Diluted $ 0.37 $ 1.08 $ 2.62 $ 3.07
 
Weighted average common shares outstanding:
Basic 29,536 29,535 29,599 29,626
Diluted 31,375 32,248 31,643 31,969

CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(dollars in thousands, except per share data)
(Unaudited)
  September 30,   December 31,
  2012     2011 2011
 
Assets
Current assets:
Cash and cash equivalents $ 78,663 $ 54,364 $ 62,542
Pawn loans 254,077 244,441 253,519
Consumer loans, net 256,825 191,642 222,778
Merchandise held for disposition, net 171,285 166,365 161,884
Pawn loan fees and service charges receivable 48,771 45,066 48,003
Income taxes receivable 684 - -
Prepaid expenses and other assets 36,912 32,095 31,301
Deferred tax assets   39,826     29,070     35,065
Total current assets 887,043 763,043 815,092
Property and equipment, net 258,214 236,325 246,429
Goodwill 599,337 538,169 562,721
Intangible assets, net 34,877 26,668 34,771
Other assets   12,936     13,948     15,236
Total assets $ 1,792,407   $ 1,578,153   $ 1,674,249
 
Liabilities and Equity
Current liabilities:
Accounts payable and accrued expenses $ 109,986 $ 95,574 $ 113,113
Customer deposits 12,944 10,588 9,935
Income taxes currently payable - 10,520 12,880
Current portion of long-term debt   44,205     21,856     34,273
Total current liabilities 167,135 138,538 170,201
Deferred tax liabilities 102,048 88,980 89,712
Noncurrent income tax payable 2,697 2,343 2,315
Other liabilities 1,007 1,522 1,413
Long-term debt   545,258     470,124     503,018
Total liabilities $ 818,145   $ 701,507   $ 766,659
 
Equity:
Cash America International, Inc. equity:
Common stock, $0.10 par value per share, 80,000,000 shares
authorized, 30,235,164 shares issued and outstanding 3,024 3,024 3,024
Additional paid-in capital 157,874 167,193 167,683
Retained earnings 855,972 739,256 776,060
Accumulated other comprehensive income (loss) 4,366 (2,352) (6,896)
Treasury shares, at cost (1,214,646 shares, 982,735 shares and
1,011,356 shares at September 30, 2012 and 2011,
and at December 31, 2011, respectively)   (46,175)     (35,752)     (37,419)
Total Cash America International, Inc. shareholders' equity 975,061 871,369 902,452
Noncontrolling interest   (799)     5,277     5,138
Total equity   974,262     876,646     907,590
Total liabilities and equity $ 1,792,407   $ 1,578,153   $ 1,674,249

CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

(Unaudited)

 
Three Months Ended Nine Months Ended
September 30, September 30,
2012   2011 2012   2011
 
Revenue
Pawn loan fees and service charges $ 76,500 $ 74,399 $ 221,450 $ 206,134
Proceeds from disposition of merchandise 153,493 157,886 517,832 473,688
Consumer loan fees 205,094 162,981 558,656 418,522
Other   4,607     3,038     10,888     10,763
Total Revenue   439,694     398,304     1,308,826     1,109,107
Cost of Revenue
Disposed merchandise 106,918 102,274 350,878 302,472
Consumer loan loss provision   84,299     60,576     219,079     145,205
Total Cost of Revenue   191,217     162,850     569,957     447,677
 
Net Revenue   248,477     235,454     738,869     661,430
Expenses
Operations and administration 181,215 157,439 515,560 445,613
Depreciation and amortization   27,074     14,850     56,882     39,600
Total Expenses   208,289     172,289     572,442     485,213
Income from Operations 40,188 63,165 166,427 176,217
Interest expense (7,196) (6,865) (21,065) (18,307)
Interest income 22 14 79 56
Foreign currency transaction gain (loss) 93 (777) (72) (1,058)
Equity in loss of unconsolidated subsidiary   (61)     (34)     (209)     (70)
Income before Income Taxes 33,046 55,503 145,160 156,838
Provision for income taxes   25,116     20,974     67,487     59,277
Net Income 7,930 34,529 77,673 97,561
Net loss attributable to the noncontrolling interest   3,773     248     5,317     575
Net Income Attributable to Cash America International, Inc. $ 11,703   $ 34,777   $ 82,990   $ 98,136
Earnings Per Share:
Net Income attributable to Cash America International, Inc. common shareholders:
Basic $ 0.40 $ 1.18 $ 2.80 $ 3.31
Diluted $ 0.37 $ 1.08 $ 2.62 $ 3.07
Weighted average common shares outstanding:
Basic 29,536 29,535 29,599 29,626
Diluted 31,375 32,248 31,643 31,969
Dividends declared per common share $ 0.035 $ 0.035 $ 0.105 $ 0.105

CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES

PAWN LENDING ACTIVITIES – FINANCIAL AND OPERATING DATA

(dollars in thousands, except where otherwise noted)

 

 

The following tables outline certain data related to the Company’s pawn loan activities as of and for the three and nine months ended September 30, 2012 and 2011 (dollars in thousands).

 
  2012   2011
Domestic   Foreign   Total Domestic   Foreign   Total
As of September 30,
Ending pawn loan balances $ 241,261 $ 12,816 $ 254,077 $ 225,921 $ 18,520 $ 244,441
Ending merchandise balance, net $ 160,075 $ 11,210 $ 171,285 $ 156,806 $ 9,559 $ 166,365
 
Three Months Ended September 30,
 
Pawn loan fees and service charges $ 73,209 $ 3,291 $ 76,500 $ 69,025 $ 5,374 $ 74,399
Average pawn loan balance outstanding $ 232,027 $ 11,870 $ 243,897 $ 218,607 $ 20,619 $ 239,226
Amount of pawn loans written and renewed $ 238,191 $ 17,655 $ 255,846 $ 240,062 $ 34,084 $ 274,146
Annualized yield on pawn loans 125.5% 110.3% 124.8% 125.3% 103.4% 123.4%
Average amount per pawn loan (in ones) $ 131 $ 84 $ 122 $ 130 $ 100 $ 125
Gross profit margin on disposition of merchandise 31.7% 14.5% 30.3% 36.6% 20.3% 35.2%
Merchandise turnover 2.6 3.7 2.7 2.6 4.6 2.7
 
2012 2011
Nine Months Ended September 30, Domestic Foreign Total Domestic Foreign Total
Pawn loan fees and service charges $ 210,807 $ 10,643 $ 221,450 $ 190,409 $ 15,725 $ 206,134
Average pawn loan balance outstanding $ 220,494 $ 13,843 $ 234,337 $ 197,316 $ 20,875 $ 218,191
Amount of pawn loans written and renewed $ 675,000 $ 51,478 $ 726,478 $ 641,260 $ 80,483 $ 721,743
Annualized yield on pawn loans 127.7% 102.7% 126.2% 129.0% 100.7% 126.3%
Average amount per pawn loan (in ones) $ 130 $ 89 $ 122 $ 125 $ 104 $ 122
Gross profit margin on disposition of merchandise 33.8% 11.5% 32.2% 37.9% 16.2% 36.1%
Merchandise turnover 3.0 3.8 3.0 2.8 5.3 3.0

CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES

MERCHANDISE DISPOSITION, GROSS PROFIT AND OPERATING DATA

(dollars in thousands)

Profit from the disposition of merchandise represents the proceeds received from the disposition of merchandise in excess of the cost of disposed merchandise, which is the Company’s cost basis in the loan or the amount paid for purchased merchandise. Retail sales include the sale of jewelry and general merchandise direct to consumers through the Company’s domestic and foreign retail services locations or over the Internet. Commercial sales include the sale of refined gold, platinum, silver, and diamonds to brokers or manufacturers. The following tables summarize the proceeds from the disposition of merchandise and the related profit for the three and nine months ended September 30, 2012 and 2011 (dollars in thousands).

 
Three Months Ended September 30,
2012   2011
Retail   Commercial   Total Retail   Commercial   Total
Proceeds from disposition $ 81,947 $ 71,546 $ 153,493 $ 79,040 $ 78,846 $ 157,886
Gross profit on disposition $ 30,023 $ 16,552 $ 46,575 $ 30,782 $ 24,830 $ 55,612
Gross profit margin 36.6 % 23.1 % 30.3 % 38.9 % 31.5 % 35.2 %
Percentage of total gross profit 64.5 % 35.5 % 100.0 % 55.4 % 44.6 % 100.0 %
Nine Months Ended September 30,
2012   2011
Retail   Commercial   Total Retail   Commercial   Total
Proceeds from disposition $ 277,602 $ 240,230 $ 517,832 $ 253,272 $ 220,416 $ 473,688
Gross profit on disposition $ 103,470 $ 63,484 $ 166,954 $ 99,908 $ 71,308 $ 171,216
Gross profit margin 37.3 % 26.4 % 32.2 % 39.4 % 32.4 % 36.1 %
Percentage of total gross profit 62.0 % 38.0 % 100.0 % 58.4 % 41.6 % 100.0 %

The table below summarizes the age of merchandise held for disposition before valuation allowance of $0.7 million at September 30, 2012 and 2011 (dollars in thousands).

  As of September 30,
2012     2011
Amount   % Amount   %
Jewelry - held for one year or less $ 101,464 59.0 $ 104,004 62.2
Other merchandise - held for one year or less   62,268   36.2       57,625   34.5
Total merchandise held for one year or less   163,732   95.2       161,629   96.7
Jewelry - held for more than one year 2,827 1.6 2,091 1.3
Other merchandise - held for more than one year   5,437   3.2       3,345   2.0
Total merchandise held for more than one year   8,264   4.8       5,436   3.3
Total merchandise held for disposition $ 171,996   100.0     $ 167,065   100.0

CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES

CONSUMER LOAN FINANCIAL AND OPERATING DATA

(dollars in thousands, except where otherwise noted)

The following tables set forth consumer loan fees by segment, adjusted for the deduction of the loan loss provision for the three and nine months ended September 30, 2012 and 2011 (dollars in thousands).

  Three Months Ended September 30,
2012   2011
Retail Services   E-Commerce   Total Retail Services   E-Commerce   Total
Interest and fees on short-term loans $ 28,364 $ 137,570 $ 165,934 $ 29,741 $ 117,084 $ 146,825
Interest and fees on installment loans   3,081       36,079       39,160       2,936       13,220       16,156  
Consumer loan fees $ 31,445 $ 173,649 $ 205,094 $ 32,677 $ 130,304 $ 162,981
Consumer loan loss provision   8,061       76,238       84,299       7,513       53,063       60,576  
Consumer loan fees, net of loss provision $ 23,384     $ 97,411     $ 120,795     $ 25,164     $ 77,241     $ 102,405  
 
Year-over-year change - $ $ (1,780) $ 20,170 $ 18,390 $ 880 $ 17,792 $ 18,672
Year-over-year change - % (7.1) % 26.1 % 18.0 % 3.6 % 29.9 % 22.3 %

Consumer loan loss provision as a % of consumer loan fees

 

  25.6 %     43.9 %     41.1 %     23.0 %     40.7 %     37.2 %
 
Nine Months Ended September 30,
2012 2011
Retail Services E-Commerce Total Retail Services E-Commerce Total
Interest and fees on short-term loans $ 81,169 $ 385,268 $ 466,437 $ 79,503 $ 304,153 $ 383,656
Interest and fees on installment loans   8,227       83,992       92,219       6,329       28,537       34,866  
Consumer loan fees $ 89,396 $ 469,260 $ 558,656 $ 85,832 $ 332,690 $ 418,522
Consumer loan loss provision   19,130       199,949       219,079       15,452       129,753       145,205  
Consumer loan fees, net of loss provision $ 70,266     $ 269,311     $ 339,577     $ 70,380     $ 202,937     $ 273,317  
 
Year-over-year change - $ $ (114) $ 66,374 $ 66,260 $ (225) $ 44,329 $ 44,104
Year-over-year change - % (0.2) % 32.7 % 24.2 % (0.3) % 27.9 % 19.2 %

Consumer loan loss provision as a % of consumer loan fees

  21.4 %     42.6 %     39.2 %     18.0 %     39.0 %     34.7 %

In addition to providing consumer loans owned by the Company and consumer loans guaranteed by the Company, which are either generally accepted accounting principles (“GAAP”) items or disclosures required by GAAP, the Company has provided combined consumer loans, which is a non-GAAP measure. In addition, the Company has provided disclosure regarding consumer loans written, which is statistical data that is not included in the Company’s financial statements. The Company also provides allowances and liabilities for losses on consumer loans on a combined basis, which are GAAP measures.

Stock quotes in this article: CSH 

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