Advance America, Cash Advance Centers, Inc. (



Q2 2011 Earnings Call

July 29, 2011 8:00 am ET


Jamie Fulmer – Investor Relations

J. Patrick O'Shaughnessy – President, Chief Executive Officer and Director

James A. Ovenden – Executive Vice President and Chief Financial Officer


David Burtzlaff – Stephens, Inc.

John Hecht – JMP Securities

Paul Purcell – Continental Advisors



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» Advance America, Cash Advance Centers, Inc. Q2 2010 Earnings Call Transcript

Good day, everyone, and welcome to the Advance America, Cash Advance Centers’ Second Quarter Earnings Results Conference Call. As a reminder, this conference is being recorded.

At this time for opening remarks and introductions, I'd like to turn the call over to Jamie Fulmer. Please go ahead, sir.

Jamie Fulmer

Good morning. Before we begin, let me remind you that during this call, our comments will include certain forward-looking statements. All comments on this call other than those relating to our historical information on our current conditions will be forward-looking statements.

For example, any statements regarding our future expenditures and financial performance, our plans for product expansion, our business strategy, perspective demand for our products or expected legislative or regulatory developments that may affect the cash advance services industry are forward-looking statements.

Please note that these forward-looking statements reflect our opinions only as of the day of this presentation and we undertake no obligation to revise or publicly release the results of any revisions to these forward-looking statements in light of new information or future events.

In this regard, please keep in mind that our actual future results could differ materially from our expectations and are subject to risks, uncertainties and other factors many of which are not within our control or may not be predicted.

For a more detailed discussion of some of these factors, please refer to the Risk Factor section of our Annual Report on Form 10-K for the year ended December 31, 2010, a copy of which is available from the SEC upon request from us or by going to our website at


Now, I'd like to turn the call over to our Chief Executive Officer, Pat Shaughnessy.

J. Patrick O’Shaughnessy

Good morning and welcome to our second quarter 2011 earnings call. Also joining me today is Jim Ovenden, our company’s Chief Financial Officer. Yesterday we were pleased to report the results of the quarter ended June 30, 2011. Before we discuss the financial results in detail, I would like to briefly update you on a few developments since our last call.

Yesterday, our Board of Directors approved Advance America's 27th consecutive dividend since becoming a public company. This dividend of $6.25 per share is payable on September 2 to stockholders of record as of August 23, 2011.

I’d now like to briefly discuss recent legislative and regulatory developments concerning our industry at both the state and the federal level.

Let me begin at the state level where legislative sessions have ended in most states across the country. In fact, as of today, legislatures remain in session in only six states. The legislative season has been a productive one as state governments continue to carefully examine the regulatory landscape as it relates to financial services including access to short-term credit, and developed rules that are designed to both protect and meet the needs of consumers.

Most notably, new laws were passed in Texas, Wisconsin, and Mississippi. We were supportive of these changes and believe that they are all consistent with our efforts to both regulatory of frameworks that enable the provision of affordable, simply, reliable, and perhaps most important transparent financial services in each of the states where we operate.

As a company with a large national footprint, this activity at the state level is crucial to how we operate our business. As we have pointed out on a number of occasions, the products offered by Advance America are highly regulated by state and federal officials across the country. Specifically, state laws typically limit the principal amount of an advance, they set maximum fees available, limit a customer’s ability to renewal an advance and require the form and substance of disclosure.

Overall, we believe many of the measures approved by lawmakers this year provide our customers with meaningful projections, while also acknowledging our continued need to obtain affordable short-term credit.

At the federal level, efforts to form the new Consumer Financial Protection Bureau continue to generate a great deal of attention from lawmakers and the media. It has been widely reported that July 21, 2011, was the official start date for the Bureau. As of that date, the Bureau has now assumed new authorities provided by the Dodd-Frank Act. Certain authorities will transfer from other agencies to the Bureau, including oversight of several laws with which we currently comply, including the Truth in Lending Act, the Equal Credit Opportunity Act, the Graham-Leach-Bliley Act, and the Fair Credit Reporting Act among others.

Even though the Bureau officially began its work last Thursday, its staff has been laying the initial groundwork for months. As they work to fulfill their statutory mandates, Bureau staff is actively meeting with financial services industry representatives, advocacy group, members of Congress, and other interested parties in an effort to include a diversity of perspective in its research and rule making.

As we have stated previously, Advance America fully intends to be a constructive participant in this process. Amid the broad regulatory discussions in Washington, we must be continually mindful of where the rubber meets the road.

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