• EZCORP Reports Second Quarter Fiscal 2024 Results

    المصدر: Nasdaq GlobeNewswire / 01 مايو 2024 16:17:22   America/New_York

    AUSTIN, Texas, May 01, 2024 (GLOBE NEWSWIRE) --  EZCORP, Inc. (NASDAQ: EZPW), a leading provider of pawn transactions in the United States and Latin America, today announced results for its second quarter ended March 31, 2024.

    Unless otherwise noted, all amounts in this release are in conformity with U.S. generally accepted accounting principles (“GAAP”) and comparisons shown are to the same period in the prior year.

    SECOND QUARTER HIGHLIGHTS

    • Net income of $21.5 million, up from a net loss of $6.8 million. In the prior-year we recorded our share of the one-time, non-cash goodwill impairment and discrete adjustments recognized by Cash Converters International of $25.6 million. On an adjusted basis1, net income increased $3.6 million or 21%.
    • Diluted earnings per share of $0.29, up from diluted loss per share of $0.12. On an adjusted basis, diluted earnings per share of $0.28, compared to $0.23.
    • Total revenues increased 11%, and gross profit increased 12%.
    • Merchandise sales gross margin remains within our targeted range at 35%.
    • Pawn loans outstanding (PLO) up 14% to $235.8 million.
    • Return on earning assets (ROEA) remains strong at 165%.

    CEO COMMENTARY AND OUTLOOK

    Lachie Given, Chief Executive Officer, stated, “We achieved record second quarter revenue and PLO, driven by strong consumer demand and excellent customer service. The challenging macro-economic environment continues to fuel robust customer demand for short-term cash and pre-owned and recycled goods.

    “During the second quarter, we opened nine de novo stores in Latin America and acquired six stores in the U.S. We also consolidated six stores, five in Latin America and one in the U.S., which netted an additional nine stores. We now have a total of 1,246 stores across the organization and over 7,800 team members. Our strong balance sheet allows us to continue to build scale, both organically and by acquiring new stores. In addition, we continue to return capital to our shareholders, having repurchased $3.0 million worth of EZCORP shares during the quarter.

    “We have 4.6 million EZ+ Rewards members, an increase of 61% over the second quarter of 2023 and 10% over last quarter. Online payments continue to gain traction with customers, and we collected $21.8 million in the U.S., up 72%, and have expanded online payments to our stores in Mexico. These initiatives to increase customer loyalty and engagement and provide a more convenient customer experience are an integral part of our growth in the local neighborhoods in which we operate.

    “Thank you to our exceptional EZCORP team members for delivering another outstanding quarter of excellent operating and financial results for our shareholders. We will continue to invest in our team and our stores, focusing on recruitment and retention, while also investing in technology and other initiatives to enhance the customer experience. This focus and investment continues to enhance value for all of our shareholders,” concluded Given.

    CONSOLIDATED RESULTS

    Three Months Ended March 31As Reported Adjusted1
    in millions, except per share amounts 2024  2023   2024  2023
            
    Total revenues$285.6 $258.4  $280.2 $258.4
    Gross profit$167.6 $149.2  $164.6 $149.2
    Income (loss) before tax$28.7 $(7.3) $27.6 $24.3
    Net income (loss)$21.5 $(6.8) $20.7 $17.1
    Diluted earnings (loss) per share$0.29 $(0.12) $0.28 $0.23
    EBITDA (non-GAAP measure)$37.4  $2.1  $36.2 $33.8
    • Diluted earnings per share of $0.29, up from diluted loss per share of $0.12. On an adjusted basis, diluted earnings per share of $0.28, up from $0.23. The primary difference between GAAP and Adjusted financial results is attributable to our share of the previously announced prior year one-time, non-cash goodwill impairment recognized by Cash Converters International.
    • Income before taxes was $28.7 million, up from loss before taxes of $7.3 million, and adjusted EBITDA increased 7% to $36.2 million.
    • PLO increased 14% to $235.8 million, up $29.7 million. On a same-store basis2, PLO increased 12% due to improved operational performance and continued strong pawn demand.
    • Total revenues increased 11%, and gross profit increased 12%, reflecting improved pawn service charge (PSC) revenues, merchandise sales and merchandise sales gross profit.
    • PSC increased 15% as a result of higher average PLO.
    • Merchandise sales gross margin remains within our target range at 35%. Aged general merchandise was 2.3% of total general merchandise inventory.
    • Net inventory increased 9%, as expected with the growth in PLO. Inventory turnover increased to 2.9x, from 2.8x.
    • Store expenses increased 13%, primarily due to increased labor, in-line with store activity, higher store count and, to a lesser extent, expenses related to our loyalty program. On a same-store basis, store expenses increased 11%.
    • General and administrative expenses increased 17%, primarily due to labor driven by incentive compensation related to an increase in share price and, to a lesser extent, costs related to the implementation of Workday.
    • Cash and cash equivalents at the end of the quarter was $229.1 million, down 6% year-over-year. The decrease was due to the increase in PLO and inventory, strategic investments, share repurchases, and the acquisition of new stores, partially offset by cash inflows provided by operating activities.

    SEGMENT RESULTS

    U.S. Pawn

    • PLO ended the quarter at $173.7 million, up 11% or 9% on a same store basis.
    • Total revenue and gross profit was up 10%, reflecting increased PSC and higher merchandise sales.
    • PSC increased 14% as a result of higher average PLO.
    • Merchandise sales increased 6%, and gross margin decreased to 37% from 38%. Aged general merchandise increased to 3.0% of total general merchandise inventory, primarily driven by luxury handbags in our Max Pawn stores.
    • Net inventory increased 9%, as expected with the growth in PLO. Inventory turnover remained flat at 2.6x.
    • Store expenses increased 12%, primarily due to salaries and benefits as we continue to support our team members as a part of People, Pawn and Passion focus, higher store count and, to a lesser extent, expenses related to our loyalty program.
    • Segment contribution increased 8% to $40.7 million.
    • During the quarter, net store count increased by five due to the acquisition of six stores and the consolidation of one store.

    Latin America Pawn

    • PLO improved to $62.0 million, up 26% (19% on constant currency basis). On a same store basis, PLO increased 22% (15% on a constant currency basis) due to improved operational performance and continued strong pawn demand.
    • Total revenues was up 12% (4% on constant currency basis), and gross profit increased 18% (10% on a constant currency basis), reflecting increased PSC, higher merchandise sales and improved merchandise sales gross profit.
    • PSC increased 18% (10% on a constant currency basis) as a result of higher average PLO.
    • Merchandise sales gross margin increased to 33% from 32%. Aged general merchandise was 1.4% of total merchandise inventory.
    • Net inventory increased 9% (2% on a constant currency basis). Inventory turnover increased to 3.6x from 3.5x.
    • Store expenses increased 15% (7% on a constant currency basis), primarily due to higher store count. Same-store expenses increased 10% (2% on a constant currency basis).
    • Segment contribution increased 2% (decreased 3% on a constant currency basis). On an adjusted basis, segment contribution was up 38% to $7.7 million, with the primary adjustment being the prior year reversal of contingent consideration liability of $2.5 million in connection with a previously completed acquisition.
    • During the quarter, net store count increased by four due to the opening of nine de novo stores and the consolidation of five stores.

    FORM 10-Q

    EZCORP’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 has been filed with the Securities and Exchange Commission. The report is available in the Investor Relations section of the Company’s website at http://investors.ezcorp.com.

    CONFERENCE CALL
    EZCORP will host a conference call on Thursday, May 2, 2024, at 8:00 am Central Time to discuss Second Quarter Fiscal 2024 results. Analysts and institutional investors may participate on the conference call by registering online at: https://register.vevent.com/register/BIc16d26b733bc44b7aecc33d2d530fef4. Once registered you will receive the dial-in details with a unique PIN to join the call. The conference call will be webcast simultaneously to the public through this link: http://investors.ezcorp.com. A replay of the conference call will be available online at http://investors.ezcorp.com shortly after the end of the call. 

    ABOUT EZCORP

    Formed in 1989, EZCORP has grown into a leading provider of pawn transactions in the United States and Latin America. We also sell pre-owned and recycled merchandise, primarily collateral forfeited from pawn lending operations and merchandise purchased from customers. We are dedicated to satisfying the short-term cash needs of consumers who are both cash and credit constrained, focusing on an industry-leading customer experience. EZCORP is traded on NASDAQ under the symbol EZPW and is a member of the S&P 1000 Index and Nasdaq Composite Index. 

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    FORWARD LOOKING STATEMENTS

    This announcement contains certain forward-looking statements regarding the Company’s strategy, initiatives and expected performance. These statements are based on the Company’s current expectations as to the outcome and timing of future events. All statements, other than statements of historical facts, including all statements regarding the Company's strategy, initiatives and future performance, that address activities or results that the Company plans, expects, believes, projects, estimates or anticipates, will, should or may occur in the future, including future financial or operating results, are forward-looking statements. Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of uncertainties and other factors, including operating risks, liquidity risks, legislative or regulatory developments, market factors, current or future litigation and risks associated with the COVID-19 pandemic. For a discussion of these and other factors affecting the Company’s business and prospects, see the Company’s annual, quarterly and other reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time.

    Contact:
    Email: Investor_Relations@ezcorp.com
    Phone: (512) 314-2220


    EZCORP, Inc.
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (Unaudited)
     
     Three Months Ended
    March 31,    		 Six Months Ended
    March 31,
    (in thousands, except per share amounts) 2024   2023   2024   2023 
    Revenues:       
    Merchandise sales$164,687  $152,507  $344,090  $316,294 
    Jewelry scrapping sales 13,714   12,825   27,796   20,709 
    Pawn service charges 107,163   93,030   213,612   185,623 
    Other revenues 75   61   132   124 
    Total revenues 285,639   258,423   585,630   522,750 
    Merchandise cost of goods sold 106,259   97,339   221,469   202,216 
    Jewelry scrapping cost of goods sold 11,788   11,902   23,996   18,855 
    Gross profit 167,592   149,182   340,165   301,679 
    Operating expenses:       
    Store expenses 114,582   101,269   225,137   202,072 
    General and administrative 18,266   15,609   34,809   31,085 
    Depreciation and amortization 8,219   7,963   16,784   15,951 
    Loss (gain) on sale or disposal of assets and other 3   73   (169)  57 
    Other income (765)  (2,465)  (765)  (2,465)
    Total operating expenses 140,305   122,449   275,796   246,700 
    Operating income 27,287   26,733   64,369   54,979 
    Interest expense 3,402   3,390   6,842   9,580 
    Interest income (2,882)  (1,898)  (5,521)  (2,562)
    Equity in net (income) loss of unconsolidated affiliates (1,719)  32,501   (2,872)  30,917 
    Other (income) expense (165)  80   (436)  (154)
    Income (loss) before income taxes 28,651   (7,340)  66,356   17,198 
    Income tax expense (benefit) 7,172   (550)  16,407   7,210 
    Net income (loss)$21,479  $(6,790) $49,949  $9,988 
            
    Basic earnings (loss) per share$0.39  $(0.12) $0.91  $0.18 
    Diluted earnings (loss) per share$0.29  $(0.12) $0.65  $0.11 
            
    Weighted-average basic shares outstanding 55,093   55,648   55,084   55,981 
    Weighted-average diluted shares outstanding 83,045   55,648   84,948   65,269 


    EZCORP, Inc.
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (Unaudited)

    (in thousands, except share and per share amounts)March 31,
    2024    		 March 31,
    2023    		 September 30,
    2023
          
    Assets:     
    Current assets:     
    Cash and cash equivalents$229,111  $243,128  $220,595 
    Restricted cash 8,581   8,451   8,373 
    Pawn loans 235,773   206,096   245,766 
    Pawn service charges receivable, net 38,268   33,116   38,885 
    Inventory, net 163,429   150,297   166,477 
    Prepaid expenses and other current assets 47,142   45,564   39,623 
    Total current assets 722,304   686,652   719,719 
    Investments in unconsolidated affiliates 13,162   10,681   10,987 
    Other investments 51,220   39,220   36,220 
    Property and equipment, net 63,306   59,775   68,096 
    Right-of-use assets, net 243,752   234,287   234,388 
    Goodwill 310,658   300,078   302,372 
    Intangible assets, net 61,714   59,620   58,216 
    Notes receivable, net —   1,233   — 
    Deferred tax asset, net 26,247   19,127   25,702 
    Other assets, net 15,779   9,859   12,011 
    Total assets$1,508,142  $1,420,532  $1,467,711 
          
    Liabilities and equity:     
    Current liabilities:     
    Current maturities of long-term debt, net$34,347  $—  $34,265 
    Accounts payable, accrued expenses and other current liabilities 62,838   72,695  $81,605 
    Customer layaway deposits 20,352   18,761   18,920 
    Operating lease liabilities, current 55,658   53,921   57,182 
    Total current liabilities 173,195   145,377   191,972 
    Long-term debt, net 326,573   359,287   325,847 
    Deferred tax liability, net 465   368   435 
    Operating lease liabilities 197,285   191,874   193,187 
    Other long-term liabilities 10,228   11,038   10,502 
    Total liabilities 707,746   707,944   721,943 
    Commitments and contingencies (Note 9)     
    Stockholders’ equity:     
    Class A Non-voting Common Stock, par value $0.01 per share; shares authorized: 100 million; issued and outstanding : 52,057,309 as of March 31, 2024; 52,561,071 as of March 31, 2023; and 51,869,569 as of September 30, 2023 521   526   519 
    Class B Voting Common Stock, convertible, par value $0.01 per share; shares authorized: 3 million; issued and outstanding: 2,970,171 30   30   30 
    Additional paid-in capital 345,174   343,088   346,181 
    Retained earnings 477,683   405,961   431,140 
    Accumulated other comprehensive loss (23,012)  (37,017)  (32,102)
    Total equity 800,396   712,588   745,768 
    Total liabilities and equity$1,508,142  $1,420,532  $1,467,711 


    EZCORP, Inc.
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (Unaudited)

     Six Months Ended
    March 31,
    (in thousands) 2024   2023 
      
    Operating activities:   
    Net income$49,949  $9,988 
    Adjustments to reconcile net income to net cash flows from operating activities:   
    Depreciation and amortization 16,784   15,951 
    Amortization of debt discount and deferred financing costs 807   736 
    Non-cash lease expense 29,514   27,546 
    Deferred income taxes 515   (6,987)
    Other adjustments (1,429)  (2,386)
    Provision for inventory reserve 183   280 
    Stock compensation expense 4,844   3,741 
    Equity in net (income) loss from investment in unconsolidated affiliates (2,872)  30,917 
    Net loss on extinguishment of debt —   3,545 
    Changes in operating assets and liabilities, net of business acquisitions:   
    Pawn service charges receivable 1,071   1,357 
    Inventory 1,617   (2,306)
    Prepaid expenses, other current assets and other assets (8,699)  (3,639)
    Accounts payable, accrued expenses and other liabilities (57,531)  (43,969)
    Customer layaway deposits 886   1,426 
    Income taxes 909   8,852 
    Dividends from unconsolidated affiliates —   1,775 
    Net cash provided by operating activities 36,548   46,827 
    Investing activities:   
    Loans made (433,194)  (378,717)
    Loans repaid 262,970   230,604 
    Recovery of pawn loan principal through sale of forfeited collateral 188,351   171,504 
    Capital expenditures, net (13,654)  (18,439)
    Acquisitions, net of cash acquired (8,610)  (12,968)
    Issuance of notes receivable —   (15,500)
    Investment in unconsolidated affiliate (850)  (2,133)
    Investment in other investments (15,000)  (15,000)
    Dividends from unconsolidated affiliates 1,745   — 
    Net cash used in investing activities (18,242)  (40,649)
    Financing activities:   
    Taxes paid related to net share settlement of equity awards (3,253)  (1,149)
    Proceeds from issuance of debt —   230,000 
    Debt issuance cost —   (7,458)
    Cash paid on extinguishment of debt —   (1,951)
    Payments on debt —   (178,488)
    Purchase and retirement of treasury stock (6,010)  (10,978)
    Payments of finance leases (276)  — 
    Net cash (used in) provided by financing activities (9,539)  29,976 
    Effect of exchange rate changes on cash and cash equivalents and restricted cash (43)  1,056 
    Net increase in cash, cash equivalents and restricted cash 8,724   37,210 
    Cash and cash equivalents and restricted cash at beginning of period 228,968   214,369 
    Cash and cash equivalents and restricted cash at end of period$237,692  $251,579 
        

                                                                                                                                    


    EZCORP, Inc.
    OPERATING SEGMENT RESULTS
      
     Three Months Ended March 31, 2024
    (Unaudited)
    (in thousands)U.S. Pawn Latin America Pawn Other Investments Total Segments Corporate Items Consolidated
                
    Revenues:           
    Merchandise sales$114,849  $49,838  $—  $164,687  $—  $164,687 
    Jewelry scrapping sales 12,686   1,028   —   13,714   —   13,714 
    Pawn service charges 80,010   27,153   —   107,163   —   107,163 
    Other revenues 29   15   31   75   —   75 
    Total revenues 207,574   78,034   31   285,639   —   285,639 
    Merchandise cost of goods sold 72,798   33,461   —   106,259   —   106,259 
    Jewelry scrapping cost of goods sold 10,794   994   —   11,788   —   11,788 
    Gross profit 123,982   43,579   31   167,592   —   167,592 
    Segment and corporate expenses (income):           
    Store expenses 80,840   33,742   —   114,582   —   114,582 
    General and administrative —   —   —   —   18,266   18,266 
    Depreciation and amortization 2,516   2,392   —   4,908   3,311   8,219 
    (Gain) loss on sale or disposal of assets and other (30)  (66)  —   (96)  99   3 
    Other income —   —   —   —   (765)  (765)
    Interest expense —   —   —   —   3,402   3,402 
    Interest income —   (608)  (633)  (1,241)  (1,641)  (2,882)
    Equity in net income of unconsolidated affiliates —   —   (1,719)  (1,719)  —   (1,719)
    Other expense (income) —   1   14   15   (180)  (165)
    Segment contribution$40,656  $8,118  $2,369  $51,143     
    Income (loss) before income taxes      $51,143  $(22,492) $28,651 

            

     Three Months Ended March 31, 2023
    (Unaudited)
    (in thousands)U.S. Pawn Latin America Pawn Other Investments Total Segments Corporate Items Consolidated
                
    Revenues:           
    Merchandise sales$108,740  $43,767  $—  $152,507  $—  $152,507 
    Jewelry scrapping sales 9,814   3,011   —   12,825   —   12,825 
    Pawn service charges 69,945   23,085   —   93,030   —   93,030 
    Other revenues 32   19   10   61   —   61 
    Total revenues 188,531   69,882   10   258,423   —   258,423 
    Merchandise cost of goods sold 67,643   29,696   —   97,339   —   97,339 
    Jewelry scrapping cost of goods sold 8,550   3,352   —   11,902   —   11,902 
    Gross profit 112,338   36,834   10   149,182   —   149,182 
    Segment and corporate expenses (income):           
    Store expenses 71,946   29,323   —   101,269   —   101,269 
    General and administrative —   —   —   —   15,609   15,609 
    Depreciation and amortization 2,560   2,332   —   4,892   3,071   7,963 
    Loss (gain) on sale or disposal of assets 81   (8)  —   73   —   73 
    Other income —   (2,465)  —   (2,465)  —   (2,465)
    Interest expense —   —   —   —   3,390   3,390 
    Interest income (1)  (298)  —   (299)  (1,599)  (1,898)
    Equity in net loss of unconsolidated affiliates —   —   32,501   32,501   —   32,501 
    Other (income) expense —   (46)  6   (40)  120   80 
    Segment contribution (loss)$37,752  $7,996  $(32,497) $13,251     
    Income (loss) before income taxes      $13,251  $(20,591) $(7,340)
                


     Six Months Ended March 31, 2024
    (Unaudited)
    (in thousands)U.S. Pawn Latin America Pawn Other Investments Total Segments Corporate Items Consolidated
                
    Revenues:           
    Merchandise sales$240,362  $103,728  $—  $344,090  $—  $344,090 
    Jewelry scrapping sales 25,501   2,295   —   27,796   —   27,796 
    Pawn service charges 159,083   54,529   —   213,612   —   213,612 
    Other revenues 66   31   35   132   —   132 
    Total revenues 425,012   160,583   35   585,630   —   585,630 
    Merchandise cost of goods sold 151,507   69,962   —   221,469   —   221,469 
    Jewelry scrapping cost of goods sold 22,078   1,918   —   23,996   —   23,996 
    Gross profit 251,427   88,703   35   340,165   —   340,165 
    Segment and corporate expenses (income):           
    Store expenses 158,095   67,042   —   225,137   —   225,137 
    General and administrative —   —   —   —   34,809   34,809 
    Depreciation and amortization 5,140   4,731   —   9,871   6,913   16,784 
    (Gain) loss on sale or disposal of assets and other (4)  (262)  —   (266)  97   (169)
    Other income —   —   —   —   (765)  (765)
    Interest expense —   —   —   —   6,842   6,842 
    Interest income —   (1,028)  (1,206)  (2,234)  (3,287)  (5,521)
    Equity in net loss of unconsolidated affiliates —   —   (2,872)  (2,872)  —   (2,872)
    Other (income) expense —   (47)  15   (32)  (404)  (436)
    Segment contribution 88,196   18,267  $4,098  $110,561     
    Income (loss) before income taxes      $110,561  $(44,205) $66,356 


     Six Months Ended March 31, 2023
    (Unaudited)
    (in thousands)U.S. Pawn Latin America Pawn Other Investments Total Segments Corporate Items Consolidated
                
    Revenues:           
    Merchandise sales$227,054  $89,240  $—  $316,294  $—  $316,294 
    Jewelry scrapping sales 16,990   3,719   —   20,709   —   20,709 
    Pawn service charges 139,255   46,368   —   185,623   —   185,623 
    Other revenues 57   35   32   124   —   124 
    Total revenues 383,356   139,362   32   522,750   —   522,750 
    Merchandise cost of goods sold 140,899   61,317   —   202,216   —   202,216 
    Jewelry scrapping cost of goods sold 14,766   4,089   —   18,855   —   18,855 
    Gross profit 227,691   73,956   32   301,679   —   301,679 
    Segment and corporate expenses (income):           
    Store expenses 145,250   56,822   —   202,072   —   202,072 
    General and administrative —   (3)  —   (3)  31,088   31,085 
    Depreciation and amortization 5,315   4,547   —   9,862   6,089   15,951 
    Loss (gain) on sale or disposal of assets 84   (27)  —   57   —   57 
    Other income —   (2,465)  —   (2,465)  —   (2,465)
    Interest expense —   —   —   —   9,580   9,580 
    Interest income (1)  (467)  —   (468)  (2,094)  (2,562)
    Equity in net loss of unconsolidated affiliates —   —   30,917   30,917   —   30,917 
    Other expense (income) —   24   10   34   (188)  (154)
    Segment contribution (loss)$77,043  $15,525  $(30,895) $61,673     
    Income (loss) before income taxes      $61,673  $(44,475) $17,198 

    EZCORP, Inc.
    STORE COUNT ACTIVITY
    (Unaudited)

     Three Months Ended March 31, 2024
     U.S. Pawn Latin America Pawn Consolidated
          
    As of December 31, 2023530  707  1,237 
    New locations opened—  9  9 
    Locations acquired6  —  6 
    Locations combined or closed(1) (5) (6)
    As of March 31, 2024535  711  1,246 


     Three Months Ended March 31, 2023
     U.S. Pawn Latin America Pawn Consolidated
          
    As of December 31, 2022525 661 1,186
    New locations opened2 11 13
    As of March 31, 2023527 672 1,199


     Six Months Ended March 31, 2024
     U.S. Pawn Latin America Pawn Consolidated
          
    As of September 30, 2023529  702  1,231 
    New locations opened—  14  14 
    Locations acquired7  —  7 
    Locations combined or closed(1) (5) (6)
    As of March 31, 2024535  711  1,246 


     Six Months Ended March 31, 2023
     U.S. Pawn Latin America Pawn Consolidated
          
    As of September 30, 2022515 660  1,175 
    New locations opened2 13  15 
    Locations acquired10 —  10 
    Locations combined or closed— (1) (1)
    As of March 31, 2023527 672  1,199 

    Non-GAAP Financial Information (Unaudited)

    In addition to the financial information prepared in conformity with accounting U.S. generally accepted accounting principles (“GAAP”), we provide certain other non-GAAP financial information on a constant currency (“constant currency”) and adjusted basis. We use constant currency results to evaluate our Latin America Pawn operations, which are denominated primarily in Mexican pesos, Guatemalan quetzales and other Latin American currencies. We believe that presentation of constant currency and adjusted results is meaningful and useful in understanding the activities and business metrics of our operations and reflect an additional way of viewing aspects of our business that, when viewed with GAAP results, provide a more complete understanding of factors and trends affecting our business. We provide non-GAAP financial information for informational purposes and to enhance understanding of our GAAP consolidated financial statements. We use this non-GAAP financial information primarily to evaluate and compare operating results across accounting periods.

    Readers should consider the information in addition to, but not instead of or superior to, our financial statements prepared in accordance with GAAP. This non-GAAP financial information may be determined or calculated differently by other companies, limiting the usefulness of those measures for comparative purposes.

    Constant currency results reported herein are calculated by translating consolidated balance sheet and consolidated statement of operations items denominated in local currency to U.S. dollars using the exchange rate from the prior-year comparable period, as opposed to the current period, in order to exclude the effects of foreign currency rate fluctuations. In addition, we have an equity method investment that is denominated in Australian dollars and is translated into U.S. dollars. We used the end-of-period rate for balance sheet items and the average closing daily exchange rate on a monthly basis during the appropriate period for statement of operations items. The end-of-period and approximate average exchange rates for each applicable currency as compared to U.S. dollars as of and for the three and six months ended March 31, 2024 and 2023 were as follows:

      March 31, Three Months Ended
    March 31,    		 Six Months Ended
    March 31,
      2024 2023 2024 2023 2024 2023
                 
    Mexican peso 16.6 18.1 17.0 18.7 17.3 19.2
    Guatemalan quetzal 7.6 7.6 7.6 7.6 7.6 7.6
    Honduran lempira 24.4 24.4 24.4 24.3 24.4 24.3
    Australian dollar 1.5 1.5 1.5 1.5 1.5 1.5

    Our statement of operations constant currency results reflect the monthly exchange rate fluctuations and so are not directly calculable from the above rates. Constant currency results, where presented, also exclude the foreign currency gain or loss.

    Miscellaneous Non-GAAP Financial Measures

     Three Months Ended
    March 31,
    (in millions) 2024   2023 
        
    Net income (loss)$21.5  $(6.8)
    Interest expense 3.4   3.4 
    Interest income (2.9)  (1.9)
    Income tax expense (benefit) 7.2   (0.6)
    Depreciation and amortization 8.2   8.0 
    EBITDA$37.4  $2.1 


     Total Revenues Gross Profit Income Before Tax Tax Effect Net Income Diluted EPS  EBITDA
                  
    2024 Q2 Reported$285.6  $167.6  $28.7  $7.2  $21.5  $0.29  $37.4 
    Corporate lease termination —   —   (0.8)  (0.2)  (0.6)  (0.01)  (0.8)
    FX Impact —   —   0.1   —   0.1   —   0.1 
    Constant Currency and other impact (5.4)  (3.0)  (0.4)  (0.1)  (0.3)  —   (0.5)
    2024 Q2 Adjusted$280.2  $164.6  $27.6  $6.9  $20.7  $0.28  $36.2 


     Total Revenues Gross Profit Income Before Tax Tax Effect Net Income Diluted EPS  EBITDA
                  
    2023 Q2 Reported$258.4 $149.2 $(7.3) $(0.5) $(6.8) $(0.12) $2.1 
    CCV Impairment and discrete adjustments —  —  34.0   8.4   25.6   0.29   34.0 
    Contingent consideration liability —  —  (2.4)  (0.7)  (1.7)  (0.02)  (2.4)
    Impact of dilutive instruments* —  —  —   —   —   0.08   — 
    2023 Q2 Adjusted$258.4 $149.2 $24.3  $7.2  $17.1  $0.23  $33.8 


     Three Months Ended
    March 31, 2024    		 Six Months Ended
    March 31, 2024
    (in millions)U.S. Dollar Amount Percentage Change YOY U.S. Dollar Amount Percentage Change YOY
            
    Consolidated revenues$285.6  11% $585.6  12%
    Currency exchange rate fluctuations (5.4)    (12.6)  
    Constant currency consolidated revenues$280.2  8% $573.0  10%
            
    Consolidated gross profit$167.6  12% $340.2  13%
    Currency exchange rate fluctuations (3.0)    (6.8)  
    Constant currency consolidated gross profit$164.6  10% $333.4  11%
            
    Consolidated net inventory$163.4  9% $163.4  9%
    Currency exchange rate fluctuations (2.8)    (2.8)  
    Constant currency consolidated net inventory$160.6  7% $160.6  7%
            
    Latin America Pawn gross profit$43.6  18% $88.7  20%
    Currency exchange rate fluctuations (3.0)    (6.8)  
    Constant currency Latin America Pawn gross profit$40.6  10% $81.9  11%
            
    Latin America Pawn PLO$62.0  26% $62.0  26%
    Currency exchange rate fluctuations (3.7)    (3.7)  
    Constant currency Latin America Pawn PLO$58.3  19% $58.3  19%
            
    Latin America Pawn PSC revenues$27.2  18% $54.5  18%
    Currency exchange rate fluctuations (1.8)    (3.9)  
    Constant currency Latin America Pawn PSC revenues$25.4  10% $50.6  9%
            
    Latin America Pawn merchandise sales$49.8  14% $103.7  16%
    Currency exchange rate fluctuations (3.6)    (8.5)  
    Constant currency Latin America Pawn merchandise sales$46.2  6% $95.2  7%
            
    Latin America Pawn segment profit before tax$8.1  2% $18.3  18%
    Currency exchange rate fluctuations (0.4)    (1.1)  
    Constant currency Latin America Pawn segment profit before tax$7.7  (4)        % $17.1  10%

     

    Note: Percentages are calculated from the underlying numbers in thousands and, as a result, may not agree to the percentages calculated from numbers in millions.
    1“Adjusted” basis, which is a non-GAAP measure, excludes certain items. “Constant currency” basis, which is a non-GAAP measure, excludes the impact of foreign currency exchange rate fluctuations. For additional information about these calculations, as well as a reconciliation to the most comparable GAAP financial measures, see “Non-GAAP Financial Information” at the end of this release.
    2“Same Store” basis, which is a financial measure, includes stores open the entirety of the comparable periods.

                            


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