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Rent-A-Center, Inc. Reports Third Quarter 2013 Results

Stocks in this article: RCII

Rent-A-Center, Inc. (the "Company") (NASDAQ/NGS: RCII), the nation's largest rent-to-own operator, today announced revenues and earnings for the quarter ended September 30, 2013.

Third Quarter 2013 Results

Total revenues for the quarter ended September 30, 2013, were $754.8 million, an increase of $15.5 million from total revenues of $739.3 million for the same period in the prior year. This 2.1% increase in total revenues was primarily due to increases of approximately $40.0 million in the RAC Acceptance segment and approximately $4.1 million in the International segment, partially offset by a decrease of approximately $26.2 million in the Core U.S. segment. For the quarter ended September 30, 2013, same store sales declined 0.8% as compared to the same period in the prior year, primarily attributable to a 5.1% decrease in the Core U.S. segment, partially offset by increases of 29.3% and 33.1% in the RAC Acceptance and International segments, respectively.

Net earnings and net earnings per diluted share for the quarter ended September 30, 2013, were $27.6 million and $0.51, respectively, as compared to $39.9 million and $0.67, respectively, for the same period in the prior year. These results include dilution related to the Company's international growth initiatives of approximately $0.09 per share in the quarter ended September 30, 2013, and approximately $0.10 per share for the same period in the prior year.

"I am pleased with our progress in building our portfolio of agreements in our Core U.S. business as we surpassed prior-year levels in the third quarter. Traffic remained strong again this quarter with deliveries up 7.3% year-over-year. I am encouraged by the improving trend in this metric as it indicates improving market share. However, continued electronic product deflation coupled with promotional activity in the quarter to attract customers who remain under pressure caused our average revenue per agreement or ticket to be down year-over-year and is the primary reason for our same store sales decline in our Core U.S. segment and the lowering of our 2013 diluted earnings per share guidance to $2.80 to $2.85,” said Mark E. Speese, the Company's Chairman and Chief Executive Officer. “Two consecutive quarters of approximately 7% increase in deliveries gives us confidence in our long-term strategy of improving the results in our Core U.S. segment,” Speese added.

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