-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LGnzEWTBDBe6/v4XhJyTSamNMSssnzFcjkrLjeFOpCeVQgS8Gk0Jlipw8G5sxlA4 63dqaSZZH9PLW12P0ttgbQ== 0001157523-05-003630.txt : 20050421 0001157523-05-003630.hdr.sgml : 20050421 20050421161544 ACCESSION NUMBER: 0001157523-05-003630 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050421 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050421 DATE AS OF CHANGE: 20050421 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: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09733 FILM NUMBER: 05764973 BUSINESS ADDRESS: STREET 1: 1600 W 7TH ST 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 8-K 1 a4870300.txt CASH AMERICA 8-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): April 21, 2005 CASH AMERICA INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) Texas 1-9733 75-2018239 (State of incorporation) (Commission File No.) (IRS Employer Identification No.) 1600 West 7th Street Fort Worth, Texas 76102 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (817) 335-1100 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION On April 21, 2005, Cash America International, Inc. (the "Company") announced its consolidated financial results for the quarter ended March 31, 2005. A copy of the Company's earnings news release is furnished as Exhibit 99.1 to this report on Form 8-K and is incorporated herein by reference. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (c) Exhibits - The following exhibit is furnished pursuant to the disclosures included under Item 2.02 of this report on Form 8-K. 99.1 Copy of earnings news release dated April 21, 2005, issued by Cash America International, Inc. 2 SIGNATURES 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 hereunto duly authorized. CASH AMERICA INTERNATIONAL, INC. Date: April 21, 2005 By: /s/ Hugh A. Simpson --------------------------------- Hugh A. Simpson Executive Vice President, General Counsel and Secretary 3 EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 99.1 Earnings news release dated April 21, 2005, issued by Cash America International, Inc. 4 EX-99.1 2 a4870300ex99.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 Cash America Reports First Quarter Results and Declares Dividend FORT WORTH, Texas--(BUSINESS WIRE)--April 21, 2005--Cash America International, Inc. (NYSE:CSH) announced today that income from continuing operations for the first quarter ended March 31, 2005 were up 30% compared to the first quarter of 2004. The results for the first quarter of 2005 include an after-tax loss of $315,000 related to foreign currency conversion equal to 1 cent per share. Income from continuing operations was $11,902,000 (39 cents per share) for the three-month period in 2005 compared to $9,142,000 (31 cents per share) in the same quarter in 2004. Total revenue for the first quarter rose 24% to $145 million in 2005 versus $117 million during the same period in 2004. Revenue gains were led by service charges on pawn loans, which were up 26% and a 44% increase in fees related to cash advances. Sales from the disposition of merchandise increased 17% in the quarter and gross profit margin was consistent from the same quarter in 2004. This led Cash America to report a 27% increase in net revenue for the three-month period to $97 million. Commenting on the results of the quarter, Daniel R. Feehan, president and chief executive officer of Cash America said, "While we posted improved results from the same quarter last year, the first quarter did not meet our expectations as revenue from our two principal lending products did not reach our expected levels in the quarter. Product demand did not recover in the latter stages of the quarter contributing to the shortfall. The related impact of lower revenue is particularly sensitive to the profitability of the 107 cash advance units established over the last twelve months and caused their contribution to earnings in the first quarter to be less than we anticipated." Cash America also reaffirmed its announcement on April 15, 2005 that at this time it is unable to provide earnings expectations for future periods in fiscal 2005 because of uncertainties surrounding the FDIC's new guidance affecting short-term cash advances. The guidance will restrict the offering of short-term cash advances by FDIC-regulated banks, and two of those banks offer cash advances through many of Cash America's stores. The banks have submitted their plans to the FDIC for compliance with the new guidance. At this point, the Company does not know when or to what extent the banks' cash advance business will change as a result of the compliance plans that the FDIC may ultimately approve. Therefore, the Company cannot predict with any degree of certainty the extent to which the eventual change in the banks' cash advance business will impact Cash America's earnings. The Company intends to publish guidance in the future when the situation involving the banks' cash advance business becomes certain enough for it to do so. Cash America will host a conference call to discuss the first quarter results on Thursday, April 21 at 3:45 PM CDT. A live web cast of the call will be available on the Investor Relations section of the Company's corporate web site (www.cashamerica.com). To listen to the live call, please go to the web site at least fifteen minutes early to register, download, and install any necessary audio software. Additionally, the Company announced that the Board of Directors, at its regularly scheduled quarterly meeting, declared a $0.025 (2.5 cents) per share cash dividend on common stock outstanding. The dividend will be paid to shareholders of record on May 4, 2005, and will be paid at the close of business on May 18, 2005. Cash America International, Inc. is a provider of specialty financial services to individuals in the United States with 851 total locations. Cash America is the largest provider of secured non-recourse loans to individuals, commonly referred to as pawn loans, through 452 locations in 21 states under the brand name Cash America Pawn and SuperPawn. The Company also offers short-term cash advances in many of its U.S. locations including 264 locations that offer this service under the brand names Cash America Payday Advance and Cashland. In addition, check cashing services are provided through its 135 franchised and Company-owned "Mr. Payroll" check cashing centers. This release contains forward-looking statements about the business, financial condition and prospects of Cash America International, Inc. and its subsidiaries ("the Company"). The actual results of the Company could differ materially from those indicated by the forward-looking statements because of various risks and uncertainties including, without limitation, changes in demand for the Company's services, the actions of third parties who offer products and services at the Company's locations, changes in competition, the ability of the Company to open new operating units in accordance with its plans, economic conditions, real estate market fluctuations, interest rate fluctuations, changes in the capital markets, changes in tax and other laws and governmental rules and regulations applicable to the Company's business, and other risks indicated in the Company's filings with the Securities and Exchange Commission. These risks and uncertainties are beyond the ability of the Company to control, and, in many cases, the Company cannot predict all of the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements. When used in this release, terms such as "believes", "estimates", "plans", "expects", "anticipates" and similar expressions as they relate to the Company or its management are intended to identify forward-looking statements. The Company disclaims any intention or obligation to update or revise any forward-looking statements to reflect events or circumstances occurring after the date of this release. CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES HIGHLIGHTS OF CONSOLIDATED RESULTS OF OPERATIONS (in thousands, except per share data) Three Months Ended March 31, ---------------------- 2005 2004 ------------ --------- Consolidated Operations: Total revenue $144,989 $117,018 Net revenue $97,034 $76,189 Total operating expenses $75,782 $59,643 Income from operations $21,252 $16,546 Income from continuing operations before income taxes $18,849 $14,454 Income from Continuing Operations $11,902 $9,142 Income from Discontinued Operations $-- $2,248 Net Income $11,902 $11,390 Income per share: Basic -- Income from continuing operations $0.41 $0.32 Net income $0.41 $0.40 Diluted -- Income from continuing operations $0.39 $0.31 Net income $0.39 $0.39 Weighted average shares: Basic 29,332 28,241 Diluted 30,396 29,453 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except share data) March 31, -------------------- December 31, 2005 2004 2004 --------- ---------- ------------ (Unaudited) Assets Current assets: Cash and cash equivalents $11,874 $9,230 $15,103 Pawn loans 97,307 73,017 109,353 Cash advances, net 30,318 23,976 36,490 Merchandise held for disposition, net 59,466 43,233 67,050 Finance and service charges receivable 17,789 13,763 20,458 Other receivables and prepaid expenses 11,941 8,028 10,547 Deferred tax assets 8,372 6,468 9,293 Current assets of discontinued operations -- 83,687 -- --------- ---------- ------------ Total current assets 237,067 261,402 268,294 --------- ---------- ------------ Property and equipment, net 88,906 68,357 87,612 Goodwill 164,374 104,477 164,073 Intangible assets, net 23,558 4,457 24,361 Other assets 11,212 1,811 10,825 Non-current assets of discontinued operations -- 30,934 -- --------- ---------- ------------ Total assets $525,117 $471,438 $555,165 ========= ========== ============ Liabilities and Stockholders' Equity Current liabilities: Accounts payable and accrued expenses $27,054 $24,977 $33,854 Customer deposits 6,358 4,858 5,686 Income taxes current payable 6,009 3,764 2,505 Current portion of long-term debt 16,786 8,286 16,786 Current liabilities of discontinued operations -- 2,909 -- --------- ---------- ------------ Total current liabilities 56,207 44,794 58,831 Deferred tax liabilities 10,520 5,830 10,999 Other liabilities 1,404 1,454 1,559 Long-term debt 113,617 113,892 149,840 Non-current liabilities of discontinued operations -- 16,221 -- Stockholders' Equity: Common stock, $.10 par value per share, 80,000,000 shares authorized; 30,235,164 shares issued 3,024 3,024 3,024 Additional paid-in capital 154,945 142,743 154,294 Retained earnings 199,050 152,538 187,860 Accumulated other comprehensive income -- 8,879 -- Notes receivable secured by common stock (2,488) (2,488) (2,488) Treasury shares at cost (997,620 shares, 1,956,372 shares and 938,386 shares at March 31, 2005 and 2004 and December 31, 2004, respectively) (11,162) (15,449) (8,754) --------- ---------- ------------ Total stockholders' equity 343,369 289,247 333,936 --------- ---------- ------------ Total liabilities and stockholders' equity $525,117 $471,438 $555,165 ========= ========== ============ CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (in thousand, except per share data) Three Months Ended March 31, ------------------- 2005 2004 ---------- -------- (Unaudited) Revenue Finance and services $33,919 $26,872 Proceeds from disposition of merchandise 78,741 67,048 Cash advance fees 28,310 19,656 Check cashing royalties and fees 4,019 3,442 ---------- -------- Total Revenue 144,989 117,018 Cost of Revenue Disposed merchandise 47,955 40,829 ---------- -------- Net Revenue 97,034 76,189 ---------- -------- Expenses Operations 53,673 41,568 Cash advance loss provision 5,634 3,044 Administration 10,909 11,107 Depreciation and amortization 5,566 3,924 ---------- -------- Total Expenses 75,782 59,643 ---------- -------- Income from Operations 21,252 16,546 Interest expense 2,337 2,131 Interest income (418) (39) Foreign currency transaction losses 484 -- ---------- -------- Income from Continuing Operations before Income Taxes 18,849 14,454 Provision for income taxes 6,947 5,312 ---------- -------- Income from Continuing Operations 11,902 9,142 ---------- -------- Income from discontinued operations before income taxes -- 3,232 Provision for income taxes -- 984 ---------- -------- Income from discontinued operations -- 2,248 ---------- -------- Net Income $11,902 $11,390 ========== ======== Earnings Per Share: Basic -- Income from continuing operations $0.41 $0.32 Income from discontinued operations $ -- $0.08 Net income $0.41 $0.40 Diluted -- Income from continuing operations $0.39 $0.31 Income from discontinued operations $ -- $0.08 Net income $0.39 $0.39 Weighted average common shares outstanding: Basic 29,332 28,241 Diluted 30,396 29,453 Dividends declared per common share $0.0250 $0.0175 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES FINANCIAL AND OPERATING DATA - CONTINUING OPERATIONS ($ in thousands) Three Months Ended March 31, ------------------- 2005 2004 ------- ------- PAWN LENDING OPERATIONS: Pawn loans Annualized yield on pawn loans 135.2% 143.1% Total amount of pawn loans written and renewed $97,830 $76,564 Average pawn loan balance outstanding $101,736 $75,507 Average pawn loan balance per average location in operation $231 $190 Average pawn loan amount at end of period (not in thousands) $88 $85 Profit margin on disposition of merchandise as a percentage of proceeds from disposition of merchandise 39.1% 39.1% Average annualized merchandise turnover 3.0x 3.5x Average balance of merchandise held for disposition per average location in operation $145 $118 Pawnshop locations in operation - Beginning of period, owned 441 398 Start-up 1 -- Combined or closed (1) (2) End of period, owned 441 396 Franchise locations at end of period 11 6 Total pawnshop locations at end of period 452 402 Average number of owned pawnshop locations in operation 441 397 Cash advances Total amount of cash advances written(a) $56,740 $44,639 Number of cash advances written (not in thousands)(a) 170,578 138,954 Average amount per cash advance (not in thousands)(a) $333 $321 Combined cash advances outstanding(a) $14,692 $10,947 Cash advances outstanding per location at end of period(a) $34 $28 Cash advances outstanding before allowance for losses(b) $9,059 $9,764 Locations offering cash advances at end of period 427 388 Average number of locations offering cash advances 427 389 CASH ADVANCE OPERATIONS (c): Total amount of cash advances written $122,085 $77,750 Number of cash advances written (not in thousands) 350,550 228,924 Average amount per cash advance (not in thousands) $348 $340 Combined cash advances outstanding(a) $28,146 $17,076 Cash advances outstanding per location at end of period $107 $104 Cash advances outstanding before allowance for losses(b) $24,355 $16,860 Cash advance locations in operation - Beginning of period 253 154 Start-ups 13 10 Combined or closed (2) -- End of period 264 164 Average number of locations in operation 258 159 CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES FINANCIAL AND OPERATING DATA - CONTINUING OPERATIONS (Continued) ($ in thousands) Three Months Ended March 31, --------------------- 2005 2004 ----------- --------- CHECK CASHING OPERATIONS (Mr. Payroll Corporation) (d): Face amount of check cashed $337,028 $322,187 Gross fees collected $5,014 $4,799 Fees as a percentage of checks cashed 1.5% 1.5% Average check cashed (not in thousands) $418 $422 Centers in operation at end of period 135 137 Average centers in operation for the period 135 137 (a) Includes cash advances made by the Company and cash advances made by third-party banks offered at the Company's locations. (b) Amounts recorded in the Company's consolidated financial statements. (c) Includes only cash advance locations. (d) Includes franchised and company-owned locations. CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED CASH ADVANCES OUTSTANDING ($ in thousands) March 31, ----------------- 2005 2004 --------- -------- Originated by the Company Active cash advances and fees receivable $20,341 $14,912 Cash advances and fees in collection 3,446 2,766 ---------- -------- Total originated by the Company 23,787 17,678 ---------- -------- Originated by banks Active cash advances and fees receivable 15,149 8,230 Cash advances and fees in collection 3,902 2,115 ---------- -------- Total originated by banks 19,051 10,345 ---------- -------- Combined gross portfolio 42,838 28,023 Less: Elimination of cash advances owned by banks 8,855 1,015 Less: Discount on cash advances assigned by banks 569 384 ---------- -------- Company cash advances and fees receivable, gross 33,414 26,624 Less: Allowance for losses 3,096 2,648 ---------- -------- Cash advances and fees receivable, net $30,318 $23,976 ========== ======== ALLOWANCE FOR LOSSES ON CASH ADVANCES ($ in thousands) Three Months Ended March 31, ------------------- 2005 2004 ---------- -------- Company Owned Cash Advances - --------------------------- Balance at beginning of period $4,358 $3,393 Cash advance loss provision 5,681 3,058 Charge-offs (9,841) (5,879) Recoveries 2,898 2,076 ---------- -------- Balance at end of period $3,096 $2,648 ========== ======== Accrual for Bank Owned Cash Advances - ------------------------------------ Balance at beginning of period $342 $55 Increase (decrease) in loss provision (47) (14) ---------- -------- Balance at end of period $295 $41 ========== ======== Combined Statistics - ------------------- Combined cash advance loss provision $5,634 $3,044 ========== ======== Combined cash advance loss provision as a % of combined cash advances written 3.2% 2.5% ========== ======== Charge-offs (net of recoveries) as a % of combined cash advances written 3.9% 3.1% ========== ======== Combined allowance for losses and accrued bank losses as a % of combined gross portfolio 7.9% 9.6% ========== ======== CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES INCOME FROM CONTINUING OPERATIONS BY OPERATING SEGMENT THREE MONTHS ENDED MARCH 31, 2005 AND 2004 (in thousands) (Unaudited) --------------------------------------------- Pawn Cash Check Lending Advance Cashing Consolidated ----------- --------- ---------- ------------ Three Months Ended March 31, 2005: - ------------------ Revenue Finance and service charges $33,919 $-- $-- $33,919 Proceeds from disposition of merchandise 78,741 -- -- 78,741 Cash advance fees 8,980 19,330 -- 28,310 Check cashing royalties and fees -- 2,888 1,131 4,019 ----------- --------- ---------- ------------ Total revenue 121,640 22,218 1,131 144,989 Cost of revenue - disposed merchandise 47,955 -- -- 47,955 ----------- --------- ---------- ------------ Net revenue 73,685 22,218 1,131 97,034 ----------- --------- ---------- ------------ Expenses Operations 40,918 12,373 382 53,673 Cash advance loss provision 2,193 3,441 -- 5,634 Administration 8,362 2,312 235 10,909 Depreciation and amortization 3,792 1,691 83 5,566 ----------- --------- ---------- ------------ Total expenses 55,265 19,817 700 75,782 ----------- --------- ---------- ------------ Income from operations $18,420 $2,401 $431 $21,252 =========== ========= ========== ============ As of March 31, 2005: - --------------------- Total assets $417,288 $100,728 $7,101 $525,117 =========== ========= ========== ============ Three Months Ended March 31, 2004: - ------------------ Revenue Finance and service charges $26,872 $-- $-- $26,872 Proceeds from disposition of merchandise 67,048 -- -- 67,048 Cash advance fees 7,119 12,537 -- 19,656 Check cashing royalties and fees -- 2,320 1,122 3,442 ----------- --------- ---------- ------------ Total revenue 101,039 14,857 1,122 117,018 Cost of revenue - disposed merchandise 40,829 -- -- 40,829 ----------- --------- ---------- ------------ Net revenue 60,210 14,857 1,122 76,189 ----------- --------- ---------- ------------ Expenses Operations 33,935 7,253 380 41,568 Cash advance loss provision 1,356 1,688 -- 3,044 Administration 9,082 1,817 208 11,107 Depreciation and amortization 2,867 943 114 3,924 ----------- --------- ---------- ------------ Total expenses 47,240 11,701 702 59,643 ----------- --------- ---------- ------------ Income from operations $12,970 $3,156 $420 $16,546 =========== ========= ========== ============ As of March 31, 2004: - --------------------- Total assets of continuing operations $280,245 $68,896 $7,676 $356,817 =========== ========= ========== ============ CONTACT: Cash America International, Inc., Fort Worth Thomas A. Bessant, Jr., 817-335-1100 -----END PRIVACY-ENHANCED MESSAGE-----