Basis and Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Schedule Of Company Operated Store Activity

The following table presents invoice volume for Progressive Leasing:

For the Three Months Ended March 31 (Unaudited and In Thousands)	2020		2019
Progressive Leasing Invoice Volume1	$	447,817	$	394,727

¹ Invoice volume is defined as the retail price of lease merchandise acquired and then leased to customers during the period, net of returns.

The following table presents store count by ownership type for the Aaron's Business operations:

Stores as of March 31 (Unaudited)	2020	2019
Company-operated Aaron's Branded Stores	1,129	1,230
Franchised Stores	318	369
Systemwide Stores	1,447	1,599

Calculation of Dilutive Stock Awards

The following table shows the calculation of dilutive share-based awards:

	Three Months Ended March 31,
(Shares In Thousands)	2020	2019
Weighted Average Shares Outstanding	66,822	67,294
Dilutive Effect of Share-Based Awards1	—	1,479
Weighted Average Shares Outstanding Assuming Dilution	66,822	68,773

¹ There was no dilutive effect to the loss per common share for the three months ended March 31, 2020 due to the net loss incurred in the period.

Accounts Receivable Net of Allowances

Accounts receivable, net of allowances, consist of the following: 

(In Thousands)	March 31, 2020		December 31, 2019
Customers	$	68,319	$	76,819
Corporate	9,844		14,109
Franchisee	9,210		13,231
Accounts Receivable	$	87,373	$	104,159

The following is a summary of the Company’s loans receivable, net:

(In Thousands)	March 31, 2020			December 31, 2019
Loans Receivable, Gross	$	99,453		$	96,387
Unamortized Fees	(6,712		)	(6,223		)
Loans Receivable, Amortized Cost	92,741			90,164
Allowance for Loan Losses	(31,594		)	(14,911		)
Loans Receivable, Net of Allowances and Unamortized Fees	$	61,147		$	75,253

Components of the Accounts Receivable Provision

The following table shows the amounts recognized for bad debt expense and provision for returns and uncollected payments:

	Three Months Ended March 31,
(In Thousands)	2020		2019
Bad Debt Expense1	$	953	$	1,125
Provision for Returns and Uncollectible Renewal Payments	84,129		62,110
Accounts Receivable Provision	$	85,082	$	63,235

¹ Bad debt expense is recorded within operating expenses in the condensed consolidated financial statements.

Schedule of Lease Merchandise

The following is a summary of lease merchandise, net of accumulated depreciation and allowances:

(In Thousands)	March 31, 2020		December 31, 2019
Merchandise on Lease, net of Accumulated Depreciation and Allowances	$	1,043,959	$	1,156,798
Merchandise Not on Lease, net of Accumulated Depreciation and Allowances	233,614		276,619
Lease Merchandise, net of Accumulated Depreciation and Allowances	$	1,277,573	$	1,433,417

Allowance for Lease Merchandise

The following table shows the components of the allowance for lease merchandise write-offs, which is included within lease merchandise, net within the condensed consolidated balance sheets:

	Three Months Ended March 31,
(In Thousands)	2020			2019
Beginning Balance	$	61,185		$	46,694
Merchandise Written off, net of Recoveries	(61,926		)	(53,222		)
Provision for Write-offs	79,675			56,995
Ending Balance	$	78,934		$	50,467

Loan Portfolio Credit Quality Indicators

Below is a summary of the credit quality of the Company's loan portfolio as of March 31, 2020 and December 31, 2019 by Fair Isaac and Company (FICO) score as determined at the time of loan origination:

FICO Score Category	March 31, 2020		December 31, 2019
600 or Less	7.6	%	6.7	%
Between 600 and 700	79.7	%	80.1	%
700 or Greater	12.7	%	13.2	%

The table below presents credit quality indicators of the amortized cost of the Company's loans receivable by origination year:

(In Thousands)
As of March 31, 2020	2020		2019		2018		2017		2016		Prior		Total
FICO Score Category:
600 or Less	$	2,278	$	3,823	$	1,034	$	176	$	105	$	19	$	7,435
Between 600 and 700	14,645		32,952		13,206		7,547		4,229		1,082		73,661
700 or Greater	2,414		4,374		2,086		1,392		1,114		265		11,645
Total Amortized Cost	$	19,337	$	41,149	$	16,326	$	9,115	$	5,448	$	1,366	$	92,741

Schedule of Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist of the following:

(In Thousands)	March 31, 2020		December 31, 2019
Prepaid Expenses	$	41,427	$	45,034
Prepaid Insurance	24,328		26,393
Assets Held for Sale	9,872		10,131
Deferred Tax Asset	826		826
Other Assets	28,759		31,887
Prepaid Expenses and Other Assets	$	105,212	$	114,271

Schedule of Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consist of the following:

(In Thousands)	March 31, 2020		December 31, 2019
Accounts Payable	$	48,172	$	89,959
Accrued Insurance Costs	50,871		44,032
Accrued Salaries and Benefits	39,492		43,972
Accrued Real Estate and Sales Taxes	31,314		32,763
Other Accrued Expenses and Liabilities	55,913		62,090
Accounts Payable and Accrued Expenses	$	225,762	$	272,816

Schedule of Goodwill

The following table provides information related to the carrying amount of goodwill by operating segment.

(In Thousands)	Progressive Leasing		Aaron’s Business			Total
Balance at December 31, 2019	$	288,801	$	447,781		$	736,582
Acquisition Accounting Adjustments	—		53			53
Disposals, Currency Translation and Other Adjustments	—		(941		)	(941		)
Impairment Loss	—		(446,893		)	(446,893		)
Balance at March 31, 2020	$	288,801	$	—		$	288,801

Schedule of Stockholders Equity

Changes in stockholders' equity for the three months ended March 31, 2020 and 2019 are as follows:

	Treasury Stock					Common Stock		Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Shareholders’ Equity
(In Thousands, Except Per Share)	Shares		Amount
Balance, December 31, 2019	(24,034	)	$	(627,940	)	$	45,376	$	290,229		$	2,029,613		$	(19	)	$	1,737,259
Opening Balance Sheet Adjustment - ASU 2016-13, net of taxes	—		—			—		—			(6,715		)	—			(6,715		)
Cash Dividends, $0.04 per share	—		—			—		—			(2,700		)	—			(2,700		)
Stock-Based Compensation	—		—			—		5,878			—			—			5,878
Reissued Shares	368		7,291			—		(12,640		)	—			—			(5,349		)
Net Loss	—		—			—		—			(280,005		)	—			(280,005		)
Foreign Currency Translation Adjustment	—		—			—		—			—			(1,754		)	(1,754		)
Balance, March 31, 2020	(23,666	)	$	(620,649	)	$	45,376	$	283,467		$	1,740,193		$	(1,773	)	$	1,446,614

	Treasury Stock					Common Stock		Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Shareholders’ Equity
(In Thousands, Except Per Share)	Shares		Amount
Balance, December 31, 2018	(23,568	)	$	(567,847	)	$	45,376	$	278,922		$	2,005,344		$	(1,087	)	$	1,760,708
Opening Balance Sheet Adjustment - ASC 842, net of taxes	—		—			—		—			2,592			—			2,592
Cash Dividends, $0.035 per share	—		—			—		—			(2,363		)	—			(2,363		)
Stock-Based Compensation	—		—			—		7,050			—			—			7,050
Reissued Shares	493		4,264			—		(15,245		)	—			—			(10,981		)
Net Earnings	—		—			—		—			56,078			—			56,078
Foreign Currency Translation Adjustment	—		—			—		—			—			424			424
Balance, March 31, 2019	(23,075	)	$	(563,583	)	$	45,376	$	270,727		$	2,061,651		$	(663	)	$	1,813,508