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Cash America International, Inc. (NYSE: CSH) announced today that it expects earnings per share for its second quarter ending June 30, 2013, to be approximately 81 cents per share. The Company’s results will fall about 11% below the low end of its estimated range of earnings per share for the second quarter published April 25, 2013.
The shortfall from estimated results is primarily attributable to lower demand for the loan products of the Domestic Retail Services Segment and higher expenses for health insurance, personnel costs and the additional interest expense associated with the $300 million senior note offering which closed in early May. The extra interest cost was not included in the earnings guidance previously provided for the second quarter. Growth in the Company’s E-commerce Segment and the disposition activities of the Retail Services Segment were in line with expectations, but the U.S. pawn lending business has not experienced as much of a rebound in demand for both pawn and consumer loans as the guidance had anticipated. Consequently, the net revenue associated with these products was below expectations. Management believes that pawn customers continue to act with caution in their borrowing and spending activities consistent with the de-leveraging underway for the broader base of U.S. consumers. This trend, which was first observed by the Company in the second quarter of 2012, will likely continue through the balance of 2013.
On July 25, 2013, the Company will release its comprehensive financial results and will provide additional details about the second quarter ended June 30, 2013. At that time, management will provide its revised outlook for the remainder of the year based on its view of current trends in its businesses and the addition of its recently announced pending acquisition of a chain of 41 pawn lending locations expected to close during the third quarter of 2013.