-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, h99bCbNiHnP/XXA72+wt2DLu240FWW1Zbo5YYULxpqqMWy2RP3U8nWZfw/dIoEse o+Gf35P4g1aYFQalw0KrTw== 0000950134-95-001112.txt : 19950516 0000950134-95-001112.hdr.sgml : 19950516 ACCESSION NUMBER: 0000950134-95-001112 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950515 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CASH AMERICA INTERNATIONAL INC CENTRAL INDEX KEY: 0000807884 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-MISCELLANEOUS RETAIL [5900] IRS NUMBER: 752018239 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-09733 FILM NUMBER: 95538857 BUSINESS ADDRESS: STREET 1: 1600 WEST 7TH STREET CITY: FT WORTH STATE: TX ZIP: 76102 BUSINESS PHONE: 8173351100 MAIL ADDRESS: STREET 1: 1600 WEST 7TH STREET CITY: FORT WORTH STATE: TX ZIP: 76102 FORMER COMPANY: FORMER CONFORMED NAME: CASH AMERICA INVESTMENTS INC /TX/ DATE OF NAME CHANGE: 19920520 10-Q 1 FORM 10-Q FOR 3/31/95 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ---------------- (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1995 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________________ to _______________ Commission File Number 1-9733 CASH AMERICA INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) TEXAS 75-2018239 (State or other jurisdiction (I.R.S. Employer of incorporation or Identification No.) organization) 1600 WEST 7TH STREET FORT WORTH, TEXAS 76102 (Address of principal executive offices) (Zip Code) (817) 335-1100 (Registrant's telephone number, including area code) N/A (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ------- ------- APPLICABLE ONLY TO CORPORATE ISSUERS: 28,584,798 common shares, $.10 par value, were outstanding as of April 30, 1995 ================================================================================ 2 CASH AMERICA INTERNATIONAL, INC. INDEX TO 10-Q PART I. FINANCIAL STATEMENTS
Page Item 1. Financial Statements (Unaudited) Consolidated Balance Sheets - March 31, 1995 and 1994 and December 31, 1994........................... 1 Consolidated Statements of Income - Three Months Ended March 31, 1995 and 1994............................ 2 Consolidated Statements of Stockholders' Equity - Three Months Ended March 31, 1995 and 1994............... 3 Consolidated Statements of Cash Flows - Three Months Ended March 31, 1995 and 1994............... 4 Notes to Consolidated Financial Statements............... 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations... 8 PART II. OTHER INFORMATION................................... 15 SIGNATURE..................................................... 16
3 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (UNAUDITED)
=================================================================================================== March 31 Dec 31 1995 1994 1994 ---------- --------- ---------- ASSETS Current assets: Cash and cash equivalents $ 4,868 $ 1,161 $ 4,827 Service charges receivable 19,333 12,817 18,626 Loans 79,344 50,753 78,095 Inventory, net 81,605 61,700 80,894 Prepaid expenses and other 7,015 4,676 6,794 ---------- --------- ---------- Total current assets 192,165 131,107 189,236 Property and equipment, net 66,954 50,698 63,241 Intangible assets, net 65,834 62,032 64,915 Other assets 6,913 3,124 6,865 ---------- --------- ---------- Total assets $331,866 $246,961 $324,257 ========== ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $ 8,770 $ 7,689 $ 13,790 Customer layaway deposits 4,260 3,283 3,576 Income taxes currently payable 5,048 3,593 3,661 ---------- --------- ---------- Total current liabilities 18,078 14,565 21,027 Long-term debt: Bank lines of credit 95,954 33,300 89,796 Notes payable - TIAA 30,000 30,000 30,000 ---------- --------- ---------- 125,954 63,300 119,796 Stockholders' equity: Common stock, $.10 par value per share, 80,000,000 shares authorized 3,024 3,024 3,024 Paid in surplus 121,525 121,008 121,481 Retained earnings 73,077 58,580 70,081 Foreign currency translation adjustment (2,403) (5,198) (3,692) ---------- --------- ---------- 195,223 177,414 190,894 Less - shares held in treasury, at cost (7,389) (8,318) (7,460) ---------- --------- ---------- Total stockholders' equity 187,834 169,096 183,434 ---------- --------- ---------- Total liabilities and stockholders' equity $331,866 $246,961 $324,257 ========== ========== ========== ===================================================================================================
See notes to consolidated financial statements. Page 1 4 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Dollars in thousands, except per share) (UNAUDITED)
========================================================================================== Three Months Ended March 31 ----------------------- 1995 1994 PAWN SERVICE CHARGES $30,103 $21,107 GROSS PROFIT FROM SALES Sales 41,100 34,207 Cost of sales 34,134 27,338 --------- --------- Gross profit 6,966 6,869 --------- --------- NET REVENUES 37,069 27,976 --------- --------- OPERATING EXPENSES Operations 21,459 16,243 Administration 4,239 3,123 Amortization 911 847 Depreciation 2,727 1,889 --------- --------- Total operating expenses 29,336 22,102 --------- --------- Income from operations 7,733 5,874 Interest expense, net 2,458 961 Other expense 56 169 --------- --------- Income before income taxes 5,219 4,744 Provision for income taxes 1,866 1,812 --------- --------- NET INCOME $ 3,353 $ 2,932 ========= ========= ========================================================================================== Net income per share: Primary $0.12 $0.10 Fully diluted $0.12 $0.10 Weighted average shares (in thousands): Primary 29,033 28,984 Fully diluted 29,033 28,984 ==========================================================================================
See notes to consolidated financial statements. Page 2 5 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Three Months Ended March 31, 1995 and 1994 (Dollars in thousands, except shares) (UNAUDITED)
============================================================================================================================ Foreign Common Stock Treasury Stock Currency -------------------- Paid In Retained ----------------------- Translation Shares Amount Surplus Earnings Shares Amount Adjustment Total ------------ ------- --------- --------- -------------- -------- ----------- --------- Balance at December 31, 1994 30,235,164 $3,024 $121,481 $70,081 1,666,099 $(7,460) $(3,692) $183,434 Net income 3,353 3,353 Dividends declared (357) (357) Treasury shares reissued 31 (15,733) 71 102 Tax benefit from exercise of stock options 13 13 Foreign currency translation adjustment 1,289 1,289 ------------ ------- --------- --------- ------------ --------- ---------- ---------- Balance at March 31, 1995 30,235,164 $3,024 $121,525 $73,077 1,650,366 $(7,389) $(2,403) $187,834 ============ ======= ========= ========= ============ ========= ========== ========== ============================================================================================================================ Balance at December 31, 1993 30,235,164 $3,024 $120,955 $56,004 1,832,137 $(7,953) $(5,308) $166,722 Net income 2,932 2,932 Dividends declared (356) (356) Treasury shares acquired 68,500 (552) (552) Treasury shares reissued (19) (43,037) 187 168 Tax benefit from exercise of stock options 72 72 Foreign currency translation adjustment 110 110 ------------ ------- --------- --------- ------------ --------- ---------- ---------- Balance at March 31, 1994 30,235,164 $3,024 $121,008 $58,580 1,857,600 $(8,318) $(5,198) $169,096 ============ ======= ========= ========= ============ ========= ========== ========== ============================================================================================================================
See notes to consolidated financial statements. Page 3 6 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) (UNAUDITED) (UNAUDITED)
========================================================================================== Three Months Ended March 31 ---------------------- 1995 1994 CASH FLOWS FROM OPERATING ACTIVITIES Reconciliation of Net Income to Net Cash Provided By Operating Activities: Net income $3,353 $2,932 Adjustments to reconcile net income to net cash provided by operating activities: Amortization 911 847 Depreciation 2,727 1,889 (Increase) decrease in service charges receivable (489) 284 (Increase) decrease in inventory (501) 2,343 (Increase) decrease in prepaid expenses and other (785) 145 Decrease in accounts payable and accrued expenses (5,121) (1,400) Increase in layaway deposits, net 682 482 Increase in income taxes payable 1,148 1,184 Increase (decrease) in deferred taxes 185 (406) --------- --------- Net cash provided by operating activities 2,110 8,300 --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES Loans forfeited and transferred to inventory 20,631 14,164 Loans repaid or renewed 57,456 43,406 Loans made, including loans renewed (78,151) (58,126) --------- --------- Net increase in loans (64) (556) Acquisitions (1,412) (4,855) Purchases of property and equipment (6,287) (3,765) Proceeds from sales of property and equipment - 1,230 --------- --------- Net cash used by investing activities (7,763) (7,946) --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES Net borrowings (payments) under bank lines of credit 5,600 (700) Proceeds from issuance of stock, net 102 168 Treasury stock acquired - (552) Dividends paid (357) (356) --------- --------- Net cash provided (used) by financing activities 5,345 (1,440) --------- --------- Effect of exchange rate changes on cash 349 2 --------- --------- Increase (decrease) in cash and cash equivalents 41 (1,084) Cash and cash equivalents at beginning of period 4,827 2,245 --------- --------- Cash and cash equivalents at end of period $4,868 $1,161 ========= ========= ==========================================================================================
See notes to consolidated financial statements. Page 4 7 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (UNAUDITED) - -------------------------------------------------------------------------------- NOTE 1 - BASIS OF PRESENTATION The accompanying consolidated financial statements include the accounts of Cash America International, Inc. and its wholly owned subsidiaries (the "Company"). All significant intercompany accounts and transactions have been eliminated in consolidation. At March 31, 1995, the Company had a 49% ownership interest in Mr. Payroll Corporation ("Mr. Payroll") (see Note 4). The investment is being accounted for using the equity method of accounting, whereby the Company records its 49% share of earnings or losses of Mr. Payroll in its consolidated financial statements. The financial statements as of March 31, 1995 and 1994 and for the three months then ended are unaudited but, in management's opinion, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such interim periods. Operating results for the three months are not necessarily indicative of the results that may be expected for the full fiscal year. Certain amounts in the consolidated statements of income for the three months ended March 31, 1994, have been reclassified to conform with the presentation form adopted in 1995. These reclassifications have no effect on the net income previously reported. These financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's 1994 Annual Report to Stockholders. NOTE 2 - ACQUISITION On September 22, 1994, the Company acquired all of the outstanding stock of Svensk Pantbelaning, a company operating a chain of ten pawnshops in Sweden. The Company paid $5.4 million and assumed liabilities of $17 million, consisting primarily of bank debt. The Company received $18 million of tangible assets, consisting primarily of $16 million in pawn loans outstanding. Page 5 8 NOTE 3 - LONG-TERM DEBT On September 21, 1994, in conjunction with the acquisition of Svensk Pantbelaning, the Company's wholly owned subsidiary, CAII Pantbelaning AB, established a 193,750,000 Swedish kronor ("SEK") term loan. The term loan matures three years from the date of inception and there is no scheduled amortization of the principal balance prior to maturity. Interest is payable at Stockholm InterBank Offered Rate (STIBOR) plus 1%, currently at 9.15%. As of March 31, 1995, SEK 193,750,000 (approximately $26,654,000) was outstanding under the term loan. On May 12, 1993, the Company issued $30,000,000 of "8.33% Senior Unsecured Notes", due May 1, 2003. Interest is payable on May 1 and November 1 of each year. Mandatory annual payments of $4,285,714 commence May 1997. On May 28, 1993, the Company entered into two swap agreements for $10,000,000 each, under which the Company receives a fixed rate of 4.87% and pays the bank a variable rate (currently 6.5625%) repriced every six months to the prevailing 6 month BBA average LIBOR rate. The effective interest rate on the Senior Unsecured Notes for the period December 2, 1994, to June 2, 1995, is 9.52% after taking into account the two swap transactions. On June 7, 1994, the Company extended the maturity date and made certain modifications to its $125,000,000 unsecured bank line of credit originally entered into on June 29, 1993. The agreement was modified to extend the maturity of $100,000,000 of the line of credit to April 30, 1997, with the remaining $25,000,000 portion scheduled to mature on June 6, 1995. As of March 31, 1995, no borrowings had been made under the $25,000,000 portion of the bank line of credit. The Company has the option each year to request a one-year extension, thus moving the maturity date of the entire facility forward one year. Interest is paid quarterly at rates determined at the Company's option of either the bank's prime lending rate or LIBOR plus 1%. In addition the agreement provides for annual commitment fees of 3/8% per annum on the unused portion of $100,000,000 of the commitment and .15% per annum on the unused portion of $25,000,000 of the commitment. The Company's wholly owned subsidiary, Harvey & Thompson, Ltd., has a committed 5 million pound sterling unsecured line of credit, which matures on February 8, 1996, from a U.K. based commercial bank. Interest is payable quarterly at an interest rate equal to the Bank's sterling cost of funds plus 60 basis points for borrowings less than 13 days and 55 basis points for borrowings of 14 days or more. Harvey & Thompson, Ltd. pays a fee on the unused portion of the line of credit of .15% per annum. The facility is governed by a credit agreement which provides minimum levels of Page 6 9 assets and net worth which must be maintained by Harvey & Thompson. To date, Harvey & Thompson has not borrowed under the line of credit. NOTE 4 - INVESTMENT IN AFFILIATE On July 13, 1994, the Company paid $2 million to acquire a 49% interest in Mr. Payroll, a private, Texas-based company which sells franchised check-cashing kiosks primarily in Southwestern states. The Company intends to operate franchised check-cashing kiosks in some of its pawnshop locations. In conjunction with its investment, the Company has entered into a revolving credit agreement with Mr. Payroll which provides for maximum borrowings of $1.5 million from the Company. Interest is payable quarterly at the LIBOR rate plus four percent. The entire unpaid principal balance is due and payable in full on February 28, 1997. Mr. Payroll has granted the Company a security interest in and lien on all of its assets. As of March 31, 1995, Mr. Payroll had borrowings outstanding of $950,000. NOTE 5 - LITIGATION The Company is a defendant in certain lawsuits encountered in the ordinary course of its business. In the opinion of management, the resolution of these matters will not have a material adverse effect on the Company's financial position or results of operations. Page 7 10 SUMMARY OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FIRST QUARTER ENDED MARCH 31, 1995 vs FIRST QUARTER ENDED MARCH 31, 1994 - -------------------------------------------------------------------------------- Summary Consolidated Financial Data - ----------------------------------------- The following table sets forth selected consolidated financial data with respect to the Company for the three months ended March 31, 1995 and 1994.
($ in thousands) 1995 1994 Change --------- --------- -------- Pawn service charges $30,103 $21,107 43% Gross profit from sales Sales 41,100 34,207 20% Cost of sales 34,134 27,338 25% --------- --------- -------- Gross profit 6,966 6,869 1% --------- --------- -------- Net Revenues $37,069 $27,976 33% --------- --------- -------- Other Data: Gross profit as a percentage of sales 17.0% 20.1% (15)% Average annualized inventory turnover 1.7X 1.8X (6)% Annualized yield on loans 154% 174% (11)% Average inventory balance per average location in operation $233 $219 6% Average loan balance per average location in operation $228 $175 30% Average pawn loan at end of period (whole dollars) $90 $74 22% Expenses as a percentage of net revenues: Operations 57.9% 58.1% 0% Administration 11.4% 11.2% 2% Depreciation and amortization 9.8% 9.8% 0% Interest, net 6.6% 3.4% 94% Locations in Operation: Beginning of period 340 280 Acquired 3 8 Established 16 6 Combined (2) (3) --------- --------- End of period 357 291 23% ========= ========= ======== Average number of locations in operations during the period (a) 349 282 24% ========= ========= ========
(a) Averages based on accumulation of month-end balances and dividing aggregate total by total months in the period. Page 8 11 1ST QUARTER 1995 VS 1994 IMPACT OF EXPANDING OPERATIONS The Company expanded its operations over the 15-month period from December 31, 1993 through March 31, 1995 with the addition of 82 pawnshops. Fifty-eight stores were started and 24 stores were acquired during the period, and five stores were combined into existing locations for a net addition of 77 stores during the 15-month period. At March 31, 1995, the Company operated 357 pawnshops--314 in 14 states in the United States, 33 jewelry-only and loan-only pawnshops in the United Kingdom operating under the name Harvey & Thompson, Ltd., and 10 loan-only pawnshops which concentrate primarily in jewelry in Sweden and operate under the name Svensk Pantbelaning. The group of corporations which comprise the Swedish chain was acquired in September 1994 in a cash transaction. Net revenues (total revenues less cost of sales) increased 33% in the first quarter of 1995 over the same period of 1994, and is attributable to a 9% gain on comparable stores (those in operation more than one year) and a 24% increase in average stores open during the two periods. PAWN SERVICE CHARGES Pawn service charges increased 43% in the first quarter of 1995 over the comparable quarter in 1994 due to gains in both comparable stores and number of average locations in operation. Pawn service charges on comparable stores increased by 20% due to an increasing loan to value ratio in domestic stores after the first quarter of 1994 and a 5% increase in the average yield on domestic loans to 218% in the first quarter of 1995 compared to 207% for the same period in 1994. In the first quarter of 1994, the Company operated its domestic pawnshops under a lower loan to value ratio, which determines the amount to lend on a particular item. When the Company increased its loan to value ratio in domestic stores later in 1994, its loan balance and pawn service charges increased, as did the amount of unredeemed merchandise available for sale to customers. The acquisition of Svensk Pantbelaning accounted for approximately 50% of the increase in pawn service charges attributable to the increase in the number of locations. The Company's average dollar loan increased to $90 from $74 and the average yield on loans outstanding decreased to 154% from 174% for the periods March 31, 1995 and 1994, respectively. Both of these factors are due to the acquisition of Svensk Pantbelaning, which has a higher amount per loan, of approximately $232, and a lower yield, of approximately 50%, than did the Company's consolidated operations in Page 9 12 the United States and the United Kingdom. The weighting of the Swedish loans in the Company's consolidated portfolio caused these changes in yields and average loan amount. The U.K. yield and the U.S. and U.K. average loan amounts were unchanged compared to the prior period and the U.S. yield increased as noted above. SALES AND GROSS PROFIT Sales for the three months ended March 31, 1995 increased 20% compared to the first quarter of 1994, caused by a 24% increase in average locations and a 4% increase in sales from comparable stores from the prior period. The Company's increase in the loan to value ratio, referred to above, after the first quarter of 1994 contributed to the increase in comparable store sales, and to a decline in the gross profit margin on sales to 17% in the three months ended March 31, 1995 compared to 20% in the prior period. In addition to a higher cost in merchandise from unredeemed loans than in the prior period, the Company utilized price discounting to sell selected merchandise and also had increased sales of jewelry at wholesale. Inventory turns declined to 1.7 times from 1.8 times in the same period of the prior year as a result of a 6% increase in average inventory per store in the three months ending March 31, 1995 compared to the prior period. Contributing to the decline in inventory turns were higher concentrations of startup stores, which have lower turns during the first year of operations, and delayed Federal income tax refunds received by the Company's customers. The Company believes that this delay, which was caused by changes in the processing methods utilized by the Internal Revenue Service, decreased sales because many customers typically use a portion of their refund to repay loans and purchase items of personal property. EXPENSES Operating expenses relative to net revenues remained constant over the two periods at 58%. The overall increase in operating expenses of 32% is driven by a 6% increase in same store operating expenses and the 24% increase in average stores in operation for the period. Administrative expenses increased 36% over the prior period, but remained virtually unchanged as a percentage of net revenues at 11% for each of the two periods. The 36% increase in administrative expense is due to the acquisition of Svensk Pantbelaning as well as increased expenses in the Company's existing operations, which were needed to continue to build infrastructure and systems to support an expanding store base. Page 10 13 Depreciation and amortization as a percentage of net revenues was constant at 9.8% over the two periods, as amortization increased 8%, primarily due to the Swedish acquisition, and depreciation increased by 44%. This increase in depreciation was due to new store additions and computer point-of-sale hardware and software, the installation of which was completed in most of the Company's stores in late 1994. Net interest expense as a percentage of net revenues increased to 6.6% in the quarter compared to 3.4% in 1994, caused by increased bank debt and higher rates on debt outstanding in the U.S., and by interest on debt used to finance the acquisition of Svensk Pantbelaning. The U.S. bank debt virtually doubled between the two periods, and weighted average interest rates on the bank debt and other domestic debt increased to 7.9% in the first quarter of 1995 from 5.8% in the year-ago period. The borrowings of Swedish kronor under a term loan bear interest at rates in effect for Swedish currency which are currently higher than U.S. short term rates. OTHER EXPENSE During the first quarter of 1995 and 1994, the Company realized losses on certain non-operating assets, before taxes, of approximately $90,000 and $200,000, respectively. These losses were partially offset by rent income and other miscellaneous items. INCOME TAXES The Company's effective tax rate decreased to 36% in the first quarter of 1995 compared to 38% in the same period in 1994. The domestic tax rate was unchanged at 39% over the two periods, while the rate in the Company's foreign operations decreased to 30% from 36% in the prior year as a result of lower tax rates for Svensk Pantbelaning and the utilization of miscellaneous tax credits in the United Kingdom in the first quarter of 1995. LIQUIDITY AND CAPITAL RESOURCES During the first quarter of 1995, the Company's capital expenditures totaled $7.7 million. The Company spent $1.4 million on the acquisition of three pawnshops and $6.3 million on leasehold improvements and equipment for start-up locations, additions to its computer systems, and miscellaneous fixed asset purchases. The funding of these items has come from the Company's three-year, $125 million revolving bank line of credit and operating earnings. The Company's $30 million of Senior Unsecured Notes, due May 1, Page 11 14 2003, to Teachers Insurance and Annuity Association of America bear interest at 8.33% and are payable in seven equal annual principal installments beginning May 1, 1997. The Company has entered into an interest rate swap on $20 million of these notes, which resulted in an effective floating interest rate, currently at 9.52%, on the debt. Management believes that borrowings available under its $125 million revolving bank line of credit facility and a 5 million pound sterling line of credit available to Harvey & Thompson, Ltd. through a U.K. commercial bank, cash generated from operations and current working capital of $174 million will be sufficient to meet the Company's anticipated future capital requirements. Page 12 15 FOREIGN OPERATIONS Presented below is selected consolidated financial data for Harvey & Thompson and Svensk Pantbelaning as of March 31, 1995, and 1994 and for the quarterly periods then ended. Acquired on September 22, 1994, Svensk Pantbelaning operates a ten store chain of loan-only pawnshops in Sweden in a manner similar to the operations of Harvey & Thompson in the U.K. Balance sheet data for Harvey & Thompson has been converted from pounds sterling into U.S. dollars using the end of the period currency exchange rate of 1.6215 at March 31, 1995, and 1.4840 at March 31, 1994. Income statement data for Harvey & Thompson has been converted at an average exchange rate of 1.5833 for the three month period ending March 31, 1995, compared to 1.4874 for the same period in 1994. Balance sheet data for Svensk Pantbelaning has been converted from Swedish kronor into U.S. dollars using the end of the period currency exchange rate of 7.3367. Income statement data for Svensk Pantbelaning has been converted at an average exchange rate of 7.3737 for the three month period ending March 31, 1995.
Three Months Ended March 31, 1995 1994 Change -------- -------- ------ ($ in thousands) Income Statement Data: Net revenues $4,777 $2,311 107% Expenses 2,320 1,102 111% Income from operations 2,457 1,209 103% Other Data: Total average locations 42 29 45% Gross profit margin 52.0% 40.4% 29% Average annualized inventory turns 3.9X 3.2X 22% Ending loan balance $33,159 $12,676 162% Average loan balance per average location in operation $755 $423 78% Expenses as a percentage of net revenues: Operations 31.4% 32.1% (2)% Administration 12.6% 10.3% 22%
Page 13 16 DOMESTIC OPERATIONS Presented below is selected financial data for the Company's domestic operations as of March 31, 1995 and 1994 and for the three months then ended:
($ in thousands) 1995 1994 Change --------- --------- -------- Pawn service charges $25,584 $18,927 35% Gross profit from sales Sales 40,604 33,882 20% Cost of sales 33,896 27,144 25% --------- --------- -------- Gross profit 6,708 6,738 0% --------- --------- -------- Net Revenues 32,292 25,665 26% ========= ========= ======== Operating expenses: Operations 19,961 15,501 29% Administration 3,635 2,885 26% Depreciation and amortization 3,420 2,614 31% --------- --------- -------- Total operating expenses 27,016 21,000 29% --------- --------- -------- Income from operations $5,276 $4,665 13% ========= ========= ======== Gross profit as a percentage of sales 16.5% 19.9% (17)% Average annualized inventory turnover 1.7X 1.8X (6)% Average inventory balance per average location in operation $264 $244 8% Average loan balance per average location in operation $155 $146 6% Average pawn loan at end of period (whole dollars) $69 $69 0% Expenses as a percentage of net revenues: Operations 61.8% 60.4% 2% Administration 11.3% 11.2% 1% Depreciation and amortization 10.6% 10.2% 4% Interest, net 6.1% 3.7% 65% Domestic Locations in Operation: Beginning of period 300 251 Acquired 3 8 Established 13 6 Combined (2) (3) --------- --------- End of period 314 262 20% Average number of locations in ========= ========= ======== operation during the period (a) 307 253 21% ========= ========= ========
(a) Averages based on accumulation of month-end balances and dividing aggregate total by total months in the period. Page 14 17 PART II Item 1. LEGAL PROCEEDINGS See Note 5 of Notes to Consolidated Financial Statements Item 2. CHANGES IN SECURITIES Not Applicable Item 3. DEFAULTS UPON SENIOR SECURITIES Not Applicable Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not Applicable Item 5. OTHER INFORMATION Not Applicable Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 27 Financial Data Schedule (b) Reports on Form 8-K - None Page 15 18 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CASH AMERICA INTERNATIONAL, INC. -------------------------------- (Registrant) BY: /s/ DALE R. WESTERFELD ---------------------------------- Dale R. Westerfeld Vice President and Chief Financial Officer Date: May 12, 1995 Page 16 19 EXHIBIT INDEX
Exhibit Description - ------- ----------- 27 Financial Data Schedule
EX-27 2 FINANCIAL DATA SCHEDULE
5 1,000 3-MOS DEC-31-1995 JAN-01-1995 MAR-31-1995 4,868 0 98,677 0 81,605 192,165 96,587 29,633 331,866 18,078 125,954 3,024 0 0 184,810 331,866 41,100 71,203 34,134 55,593 7,877 0 2,458 5,219 1,866 3,353 0 0 0 3,353 .12 .12
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