☒
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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75-2237318
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1600 West 7th Street
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Fort Worth
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Texas
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76102
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Trading Symbol(s)
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Name of Each Exchange on Which Registered
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Common Stock, par value $.01 per share
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FCFS
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The Nasdaq Stock Market
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☒
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Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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Year Ended December 31,
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|||||||||||||
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2019
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2018
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2017
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2016
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2015
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|||||
U.S. operations segment:
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|||||
Merged Cash America locations
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—
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—
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—
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815
|
|
|
—
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New locations opened
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—
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|
|
—
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|
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2
|
|
|
—
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|
|
—
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|
Locations acquired
|
27
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|
|
27
|
|
|
1
|
|
|
3
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|
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33
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|
Total additions
|
27
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|
|
27
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|
|
3
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818
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33
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|||||
Latin America operations segment:
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|||||
New locations opened
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89
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|
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52
|
|
|
45
|
|
|
41
|
|
|
38
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|
Locations acquired
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163
|
|
|
366
|
|
|
5
|
|
|
179
|
|
|
32
|
|
Total additions
|
252
|
|
|
418
|
|
|
50
|
|
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220
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|
|
70
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|
|
|
|
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|||||
Total:
|
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|
|
|
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|
|
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|||
Merged Cash America locations
|
—
|
|
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—
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|
|
—
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|
|
815
|
|
|
—
|
|
New locations opened
|
89
|
|
|
52
|
|
|
47
|
|
|
41
|
|
|
38
|
|
Locations acquired
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190
|
|
|
393
|
|
|
6
|
|
|
182
|
|
|
65
|
|
Total additions
|
279
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|
|
445
|
|
|
53
|
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|
1,038
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|
|
103
|
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U.S.
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Latin America
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Operations Segment (1)
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Operations Segment (2)
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Total Locations
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|||
Total locations, beginning of period
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1,094
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1,379
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2,473
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New locations opened
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—
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89
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|
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89
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Locations acquired
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27
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163
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|
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190
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Locations closed or consolidated (3)
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(65
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)
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(8
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)
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(73
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)
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Total locations, end of period
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1,056
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1,623
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2,679
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(1)
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At December 31, 2019, includes six consumer loan locations located in Texas, which only offer credit services products. This compares to 17 consumer loan locations which only offered consumer loans and/or credit services as of December 31, 2018. At December 31, 2019, 41 of the pawn stores, primarily located in Texas, also offered consumer loans and/or credit services primarily as an ancillary product. This compares to 262 U.S. pawn locations which offered such products as of December 31, 2018. The table does not include 46 check cashing locations operated by independent franchisees under franchising agreements with the Company.
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(2)
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The table does not include 43 Mexico pawn locations operated by independent franchisees under franchising agreements with the Company.
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(3)
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Includes the closing of 52 Ohio locations and two other locations in Texas primarily focused on consumer lending products.
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Number of
Locations (1)
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U.S.:
|
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Texas (2)
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418
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Florida
|
77
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Ohio
|
67
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Tennessee
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53
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Georgia
|
46
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North Carolina
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41
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Washington
|
32
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Indiana
|
30
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Colorado
|
29
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Maryland
|
29
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Arizona
|
27
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Illinois
|
27
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Nevada
|
27
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South Carolina
|
27
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Kentucky
|
26
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Louisiana
|
26
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Missouri
|
24
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Oklahoma
|
18
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Alabama
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8
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Alaska
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6
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Utah
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6
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Virginia
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6
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District of Columbia
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3
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Wyoming
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2
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Nebraska
|
1
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1,056
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Mexico:
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Veracruz
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218
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Estado de. Mexico (State of Mexico)
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185
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Puebla
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114
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Tamaulipas
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94
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Baja California
|
81
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Jalisco
|
67
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Nuevo Leon
|
67
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Estado de Ciudad de Mexico (State of Mexico City)
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63
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Chiapas
|
60
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Oaxaca
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55
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Tabasco
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53
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Coahuila
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49
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Hidalgo
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43
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Chihuahua
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42
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Guanajuato
|
40
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Number of
Locations (1)
|
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Mexico (continued):
|
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Sonora
|
33
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Quintana Roo
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32
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Sinaloa
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28
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Guerrero
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27
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Morelos
|
24
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Aguascalientes
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22
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Michoacan
|
22
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San Luis Potosi
|
21
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Campeche
|
17
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Durango
|
17
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Queretaro
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16
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Tlaxcala
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12
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Yucatan
|
11
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Zacatecas
|
11
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Baja California Sur
|
10
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Nayarit
|
9
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Colima
|
5
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1,548
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|
|
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Guatemala
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54
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El Salvador
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13
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Colombia
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8
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Total
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2,679
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(1)
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The table does not include 43 Mexico pawn locations and 46 U.S. check cashing locations operated by independent franchisees under franchising agreements with the Company.
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(2)
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Includes six consumer loan locations, which only offer credit services products.
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•
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make it more difficult for it to satisfy its obligations with respect to the Notes and its other indebtedness, resulting in possible defaults on and acceleration of such indebtedness;
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•
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require it to dedicate a substantial portion of its cash flow from operations to the payment of principal and interest on its indebtedness, thereby reducing the availability of such cash flows to fund working capital, acquisitions, new store openings, capital expenditures and other general corporate purposes;
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•
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limit its ability to obtain additional financing for working capital, acquisitions, new store openings, capital expenditures, debt service requirements and other general corporate purposes;
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•
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limit its ability to refinance indebtedness or cause the associated costs of such refinancing to increase;
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•
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restrict the ability of its subsidiaries to pay dividends or otherwise transfer assets to the Company, which could limit its ability to, among other things, make required payments on its debt;
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•
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increase the Company's vulnerability to general adverse economic and industry conditions, including interest rate fluctuations (because a portion of its borrowings are at variable rates of interest); and
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•
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place the Company at a competitive disadvantage compared to other companies with proportionately less debt or comparable debt at more favorable interest rates who, as a result, may be better positioned to withstand economic downturns.
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Description
|
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Location
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Square Footage
|
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Lease Expiration Date
|
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Monthly Rental Payment
|
||
Administrative offices
|
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Monterrey, Mexico
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|
15,000
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|
December 31, 2024
|
|
$
|
15
|
|
Administrative offices
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Mexico City, Mexico
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|
8,000
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|
March 31, 2024
|
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15
|
|
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Administrative operations
|
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Cincinnati, Ohio
|
|
10,000
|
|
Month-to-month
|
|
10
|
|
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Administrative operations
|
|
Fort Worth, Texas
|
|
24,000
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|
July 31, 2021
|
|
10
|
|
|
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Total
Number
Of Shares
Purchased
|
|
Average
Price
Paid
Per Share
|
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Total Number Of
Shares Purchased
As Part Of Publicly
Announced Plans
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Approximate Dollar Value Of Shares That May Yet Be Purchased Under The Plans
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||||||
October 1 through October 31, 2019
|
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292,000
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$
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89.29
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292,000
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$
|
49,818
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November 1 through November 30, 2019
|
|
194,000
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|
|
80.10
|
|
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194,000
|
|
|
34,267
|
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December 1 through December 31, 2019
|
|
68,000
|
|
|
80.45
|
|
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68,000
|
|
|
28,797
|
|
||
Total
|
|
554,000
|
|
|
84.98
|
|
|
554,000
|
|
|
|
Plan Authorization Date
|
|
Plan Completion Date
|
|
Dollar Amount Authorized
|
|
Shares Purchased in 2019
|
|
Dollar Amount Purchased in 2019
|
|
Remaining Dollar Amount Authorized For Future Purchases
|
|||||||
July 25, 2018
|
|
April 23, 2019
|
|
$
|
100,000
|
|
|
496,000
|
|
|
$
|
42,760
|
|
|
$
|
—
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October 24, 2018
|
|
Currently active
|
|
100,000
|
|
|
809,000
|
|
|
71,203
|
|
|
28,797
|
|
|||
Total
|
|
|
|
|
|
1,305,000
|
|
|
$
|
113,963
|
|
|
$
|
28,797
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(in thousands, except per share amounts and location counts)
|
||||||||||||||||||
Income Statement Data (1):
|
|
|
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|
||||||||||
Revenue:
|
|
|
|
|
|
|
|
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|
||||||||||
Retail merchandise sales
|
$
|
1,175,561
|
|
|
$
|
1,091,614
|
|
|
$
|
1,051,099
|
|
|
$
|
669,131
|
|
|
$
|
449,296
|
|
Pawn loan fees
|
564,824
|
|
|
525,146
|
|
|
510,905
|
|
|
312,757
|
|
|
195,448
|
|
|||||
Wholesale scrap jewelry sales
|
103,876
|
|
|
107,821
|
|
|
140,842
|
|
|
62,638
|
|
|
32,055
|
|
|||||
Consumer loan and credit services fees
|
20,178
|
|
|
56,277
|
|
|
76,976
|
|
|
43,851
|
|
|
27,803
|
|
|||||
Total revenue
|
1,864,439
|
|
|
1,780,858
|
|
|
1,779,822
|
|
|
1,088,377
|
|
|
704,602
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cost of retail merchandise sold
|
745,861
|
|
|
696,666
|
|
|
679,703
|
|
|
418,556
|
|
|
278,631
|
|
|||||
Cost of wholesale scrap jewelry sold
|
96,072
|
|
|
99,964
|
|
|
132,794
|
|
|
53,025
|
|
|
27,628
|
|
|||||
Consumer loan and credit services loss provision
|
4,159
|
|
|
17,461
|
|
|
19,819
|
|
|
11,993
|
|
|
7,159
|
|
|||||
Total cost of revenue
|
846,092
|
|
|
814,091
|
|
|
832,316
|
|
|
483,574
|
|
|
313,418
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenue
|
1,018,347
|
|
|
966,767
|
|
|
947,506
|
|
|
604,803
|
|
|
391,184
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Expenses and other income:
|
|
|
|
|
|
|
|
|
|
||||||||||
Store operating expenses
|
595,539
|
|
|
563,321
|
|
|
552,191
|
|
|
327,062
|
|
|
207,731
|
|
|||||
Administrative expenses
|
122,334
|
|
|
120,042
|
|
|
122,473
|
|
|
96,537
|
|
|
51,883
|
|
|||||
Depreciation and amortization
|
41,904
|
|
|
42,961
|
|
|
55,233
|
|
|
31,865
|
|
|
17,939
|
|
|||||
Interest expense, net
|
32,980
|
|
|
26,729
|
|
|
22,438
|
|
|
19,569
|
|
|
15,321
|
|
|||||
Merger and other acquisition expenses
|
1,766
|
|
|
7,643
|
|
|
9,062
|
|
|
36,670
|
|
|
2,875
|
|
|||||
(Gain) loss on foreign exchange
|
(787
|
)
|
|
762
|
|
|
(317
|
)
|
|
952
|
|
|
(159
|
)
|
|||||
Loss on extinguishment of debt
|
—
|
|
|
—
|
|
|
14,114
|
|
|
—
|
|
|
—
|
|
|||||
Net gain on sale of common stock of Enova
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,299
|
)
|
|
—
|
|
|||||
Goodwill impairment - U.S. consumer loan operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,913
|
|
|||||
Total expenses and other income
|
793,736
|
|
|
761,458
|
|
|
775,194
|
|
|
511,356
|
|
|
303,503
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Income before income taxes
|
224,611
|
|
|
205,309
|
|
|
172,312
|
|
|
93,447
|
|
|
87,681
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for income taxes
|
59,993
|
|
|
52,103
|
|
|
28,420
|
|
|
33,320
|
|
|
26,971
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
$
|
164,618
|
|
|
$
|
153,206
|
|
|
$
|
143,892
|
|
|
$
|
60,127
|
|
|
$
|
60,710
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dividends declared per common share
|
$
|
1.02
|
|
|
$
|
0.91
|
|
|
$
|
0.77
|
|
|
$
|
0.565
|
|
|
$
|
—
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Income Statement Data (Continued) (1):
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
3.83
|
|
|
3.42
|
|
|
3.01
|
|
|
1.72
|
|
|
2.16
|
|
|||||
Diluted
|
3.81
|
|
|
3.41
|
|
|
3.00
|
|
|
1.72
|
|
|
2.14
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Inventories
|
$
|
265,256
|
|
|
$
|
275,130
|
|
|
$
|
276,771
|
|
|
$
|
330,683
|
|
|
$
|
93,458
|
|
Pawn loans
|
369,527
|
|
|
362,941
|
|
|
344,748
|
|
|
350,506
|
|
|
117,601
|
|
|||||
Net working capital
|
538,087
|
|
|
656,847
|
|
|
721,626
|
|
|
748,507
|
|
|
279,259
|
|
|||||
Total assets
|
2,439,440
|
|
|
2,107,974
|
|
|
2,062,784
|
|
|
2,145,203
|
|
|
752,895
|
|
|||||
Long-term liabilities
|
886,503
|
|
|
656,825
|
|
|
466,880
|
|
|
551,589
|
|
|
275,338
|
|
|||||
Total liabilities
|
1,089,405
|
|
|
789,870
|
|
|
587,451
|
|
|
695,217
|
|
|
321,513
|
|
|||||
Stockholders’ equity
|
1,350,035
|
|
|
1,318,104
|
|
|
1,475,333
|
|
|
1,449,986
|
|
|
431,382
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Statement of Cash Flows Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash flows provided by (used in):
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating activities
|
$
|
231,596
|
|
|
$
|
243,429
|
|
|
$
|
220,357
|
|
|
$
|
96,854
|
|
|
$
|
92,749
|
|
Investing activities
|
(137,053
|
)
|
|
(159,247
|
)
|
|
1,397
|
|
|
(25,967
|
)
|
|
(71,676
|
)
|
|||||
Financing activities
|
(120,806
|
)
|
|
(127,061
|
)
|
|
(197,506
|
)
|
|
(58,713
|
)
|
|
9,127
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Location Counts:
|
|
|
|
|
|
|
|
|
|
||||||||||
Pawn stores
|
2,673
|
|
|
2,456
|
|
|
2,039
|
|
|
2,012
|
|
|
1,005
|
|
|||||
Consumer loan stores
|
6
|
|
|
17
|
|
|
72
|
|
|
73
|
|
|
70
|
|
|||||
|
2,679
|
|
|
2,473
|
|
|
2,111
|
|
|
2,085
|
|
|
1,075
|
|
(1)
|
See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Information—Adjusted Net Income and Adjusted Diluted Earnings Per Share” for additional information about certain 2019, 2018 and 2017 income and expense items that affected the Company’s consolidated net income and diluted earnings per share.
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
||||||||
|
|
Rate
|
|
% Change
Over Prior-
Year Period
Favorable /
(Unfavorable)
|
|
Rate
|
|
% Change
Over Prior-
Year Period
Favorable /
(Unfavorable)
|
|
Rate
|
||||||
Mexican peso / U.S. dollar exchange rate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
End-of-period
|
|
18.8
|
|
|
5
|
%
|
|
|
19.7
|
|
|
—
|
%
|
|
|
19.7
|
Twelve months ended
|
|
19.3
|
|
|
(1
|
)%
|
|
|
19.2
|
|
|
(2
|
)%
|
|
|
18.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Guatemalan quetzal / U.S. dollar exchange rate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
End-of-period
|
|
7.7
|
|
|
—
|
%
|
|
|
7.7
|
|
|
(5
|
)%
|
|
|
7.3
|
Twelve months ended
|
|
7.7
|
|
|
(3
|
)%
|
|
|
7.5
|
|
|
(1
|
)%
|
|
|
7.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Colombian peso / U.S. dollar exchange rate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
End-of-period
|
|
3,277
|
|
|
(1
|
)%
|
|
|
3,250
|
|
|
(9
|
)%
|
|
|
2,984
|
Twelve months ended
|
|
3,280
|
|
|
(11
|
)%
|
|
|
2,956
|
|
|
—
|
%
|
|
|
2,951
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Revenue:
|
|
|
|
|
|
|||
Retail merchandise sales
|
63.0
|
%
|
|
61.3
|
%
|
|
59.1
|
%
|
Pawn loan fees
|
30.3
|
|
|
29.5
|
|
|
28.7
|
|
Wholesale scrap jewelry sales
|
5.6
|
|
|
6.0
|
|
|
7.9
|
|
Consumer loan and credit services fees
|
1.1
|
|
|
3.2
|
|
|
4.3
|
|
|
|
|
|
|
|
|||
Cost of revenue:
|
|
|
|
|
|
|||
Cost of retail merchandise sold
|
40.0
|
|
|
39.1
|
|
|
38.2
|
|
Cost of wholesale scrap jewelry sold
|
5.2
|
|
|
5.6
|
|
|
7.5
|
|
Consumer loan and credit services loss provision
|
0.2
|
|
|
1.0
|
|
|
1.1
|
|
|
|
|
|
|
|
|||
Net revenue
|
54.6
|
|
|
54.3
|
|
|
53.2
|
|
|
|
|
|
|
|
|||
Expenses and other income:
|
|
|
|
|
|
|||
Store operating expenses
|
31.9
|
|
|
31.6
|
|
|
31.0
|
|
Administrative expenses
|
6.6
|
|
|
6.8
|
|
|
6.9
|
|
Depreciation and amortization
|
2.2
|
|
|
2.4
|
|
|
3.1
|
|
Interest expense, net
|
1.8
|
|
|
1.5
|
|
|
1.2
|
|
Merger and other acquisition expenses
|
0.1
|
|
|
0.4
|
|
|
0.5
|
|
(Gain) loss on foreign exchange
|
—
|
|
|
0.1
|
|
|
—
|
|
Loss on extinguishment of debt
|
—
|
|
|
—
|
|
|
0.8
|
|
|
|
|
|
|
|
|||
Income before income taxes
|
12.0
|
|
|
11.5
|
|
|
9.7
|
|
Provision for income taxes
|
3.2
|
|
|
2.9
|
|
|
1.6
|
|
Net income
|
8.8
|
|
|
8.6
|
|
|
8.1
|
|
|
|
Year Ended December 31,
|
||||||||||||||
|
|
As Reported (GAAP)
|
|
Adjusted (Non-GAAP)
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenue
|
|
$
|
1,864,439
|
|
|
$
|
1,780,858
|
|
|
$
|
1,864,439
|
|
|
$
|
1,780,858
|
|
Net income
|
|
$
|
164,618
|
|
|
$
|
153,206
|
|
|
$
|
167,900
|
|
|
$
|
158,290
|
|
Diluted earnings per share
|
|
$
|
3.81
|
|
|
$
|
3.41
|
|
|
$
|
3.89
|
|
|
$
|
3.53
|
|
EBITDA (non-GAAP measure)
|
|
$
|
299,495
|
|
|
$
|
274,999
|
|
|
$
|
303,782
|
|
|
$
|
284,156
|
|
Weighted-average diluted shares
|
|
43,208
|
|
|
44,884
|
|
|
43,208
|
|
|
44,884
|
|
•
|
Consolidated revenue increased 5% and totaled $1.9 billion.
|
•
|
Revenue from core pawn operations, which includes retail merchandise sales and pawn fees, increased $123.6 million, or 8%.
|
•
|
Net revenue (gross profit) increased $51.6 million with a 30 basis point increase in the gross margin to 55% of revenues.
|
•
|
Pre-tax profit margin increased 50 basis points to 12.0% and adjusted pre-tax profit margin, which is calculated using a non-GAAP financial measure, increased 30 basis points to 12.3%.
|
•
|
Net income increased $11.4 million, or 7%, and adjusted net income, a non-GAAP financial measure, increased $9.6 million, or 6%.
|
•
|
Diluted earnings per share increased 12% to $3.81 and adjusted diluted earnings per share, a non-GAAP financial measure, increased 10% to $3.89.
|
•
|
Adjusted EBITDA, a non-GAAP financial measure, increased 7% and totaled $303.8 million.
|
•
|
The Company repurchased 1,305,000 shares of its outstanding common shares for $114.0 million.
|
•
|
Cash dividends totaled $1.02 per common share, representing a 12% increase in dividends per share.
|
•
|
The Company added a total of 279 locations, including 89 new locations and 190 acquired locations.
|
•
|
As of December 31, 2019, the Company had 2,679 store locations, which represents a store count increase of 8%.
|
|
As of December 31,
|
|
Increase /
|
|||||||||
|
2019
|
|
2018
|
|
(Decrease)
|
|||||||
U.S. Operations Segment
|
|
|
|
|
|
|
|
|
|
|||
Earning assets:
|
|
|
|
|
|
|
|
|
|
|||
Pawn loans
|
$
|
268,793
|
|
|
$
|
271,584
|
|
|
|
(1
|
)%
|
|
Inventories
|
|
181,320
|
|
|
|
199,978
|
|
|
|
(9
|
)%
|
|
Consumer loans, net (1)
|
|
751
|
|
|
|
15,902
|
|
|
|
(95
|
)%
|
|
|
$
|
450,864
|
|
|
$
|
487,464
|
|
|
|
(8
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|||
Average outstanding pawn loan amount (in ones)
|
$
|
177
|
|
|
$
|
172
|
|
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|||
Composition of pawn collateral:
|
|
|
|
|
|
|
|
|
|
|||
General merchandise
|
34
|
%
|
|
34
|
%
|
|
|
|
|
|||
Jewelry
|
66
|
%
|
|
66
|
%
|
|
|
|
|
|||
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Composition of inventories:
|
|
|
|
|
|
|
|
|
|
|||
General merchandise
|
47
|
%
|
|
42
|
%
|
|
|
|
|
|||
Jewelry
|
53
|
%
|
|
58
|
%
|
|
|
|
|
|||
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Percentage of inventory aged greater than one year
|
3
|
%
|
|
4
|
%
|
|
|
|
|
(1)
|
Does not include the off-balance sheet principal portion of active extensions of credit made by independent third-party lenders, which are guaranteed by the Company through its CSO Program. These amounts, net of the Company’s estimated fair value of its liability for guaranteeing the extensions of credit, totaled $1.2 million and $5.8 million as of December 31, 2019 and 2018, respectively. The Company ceased offering unsecured consumer lending and credit services products in all of its Ohio locations on April 26, 2019 and closed 52 Ohio locations during the second quarter of 2019. See “— Consumer Lending Operations” for further discussion.
|
|
|
Year Ended December 31,
|
|
Increase /
|
|||||||||
|
|
2019
|
|
2018
|
|
(Decrease)
|
|||||||
U.S. Operations Segment
|
|
|
|
|
|
|
|
|
|||||
Revenue:
|
|
|
|
|
|
|
|
|
|||||
Retail merchandise sales
|
|
$
|
722,127
|
|
|
$
|
709,594
|
|
|
|
2
|
%
|
|
Pawn loan fees
|
|
379,395
|
|
|
373,406
|
|
|
|
2
|
%
|
|
||
Wholesale scrap jewelry sales
|
|
71,813
|
|
|
85,718
|
|
|
|
(16
|
)%
|
|
||
Consumer loan and credit services fees (1)
|
|
20,178
|
|
|
55,417
|
|
|
|
(64
|
)%
|
|
||
Total revenue
|
|
1,193,513
|
|
|
1,224,135
|
|
|
|
(3
|
)%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
|||||
Cost of retail merchandise sold
|
|
447,911
|
|
|
450,516
|
|
|
|
(1
|
)%
|
|
||
Cost of wholesale scrap jewelry sold
|
|
65,941
|
|
|
78,308
|
|
|
|
(16
|
)%
|
|
||
Consumer loan and credit services loss provision (1)
|
|
4,159
|
|
|
17,223
|
|
|
|
(76
|
)%
|
|
||
Total cost of revenue
|
|
518,011
|
|
|
546,047
|
|
|
|
(5
|
)%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Net revenue
|
|
675,502
|
|
|
678,088
|
|
|
|
—
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Segment expenses:
|
|
|
|
|
|
|
|
|
|||||
Store operating expenses
|
|
412,508
|
|
|
414,097
|
|
|
|
—
|
%
|
|
||
Depreciation and amortization
|
|
20,860
|
|
|
21,021
|
|
|
|
(1
|
)%
|
|
||
Total segment expenses
|
|
433,368
|
|
|
435,118
|
|
|
|
—
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Segment pre-tax operating income
|
|
$
|
242,134
|
|
|
$
|
242,970
|
|
|
|
—
|
%
|
|
(1)
|
The Company ceased offering unsecured consumer lending and credit services products in all of its Ohio locations on April 26, 2019 and closed 52 Ohio locations during the second quarter of 2019. See “— Consumer Lending Operations” for further discussion.
|
|
|
|
|
|
|
|
|
|
|
|
Constant Currency Basis
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
As of
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
||||||||
|
As of December 31,
|
|
|
|
2019
|
|
Increase
|
||||||||||||||
|
2019
|
|
2018
|
|
Increase
|
|
(Non-GAAP)
|
|
(Non-GAAP)
|
||||||||||||
Latin America Operations Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Earning assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Pawn loans
|
$
|
100,734
|
|
|
$
|
91,357
|
|
|
|
10
|
%
|
|
|
$
|
96,640
|
|
|
|
6
|
%
|
|
Inventories
|
|
83,936
|
|
|
|
75,152
|
|
|
|
12
|
%
|
|
|
80,490
|
|
|
|
7
|
%
|
|
|
|
$
|
184,670
|
|
|
$
|
166,509
|
|
|
|
11
|
%
|
|
|
$
|
177,130
|
|
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Average outstanding pawn loan amount (in ones)
|
$
|
71
|
|
|
$
|
68
|
|
|
|
4
|
%
|
|
|
$
|
68
|
|
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Composition of pawn collateral:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
General merchandise
|
67
|
%
|
|
74
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
Jewelry
|
33
|
%
|
|
26
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Composition of inventories:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
General merchandise
|
66
|
%
|
|
68
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
Jewelry
|
34
|
%
|
|
32
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Percentage of inventory aged greater than one year
|
1
|
%
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant Currency Basis
|
||||||||||||
|
|
|
|
|
|
|
|
Year Ended
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
December 31,
|
|
Increase /
|
||||||||||||
|
|
Year Ended December 31,
|
|
Increase /
|
|
2019
|
|
(Decrease)
|
||||||||||||||
|
|
2019
|
|
2018
|
|
(Decrease)
|
|
(Non-GAAP)
|
|
(Non-GAAP)
|
||||||||||||
Latin America Operations Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Retail merchandise sales
|
|
$
|
453,434
|
|
|
$
|
382,020
|
|
|
|
19
|
%
|
|
|
$
|
454,431
|
|
|
|
19
|
%
|
|
Pawn loan fees
|
|
185,429
|
|
|
151,740
|
|
|
|
22
|
%
|
|
|
185,826
|
|
|
|
22
|
%
|
|
|||
Wholesale scrap jewelry sales
|
|
32,063
|
|
|
22,103
|
|
|
|
45
|
%
|
|
|
32,063
|
|
|
|
45
|
%
|
|
|||
Consumer loan fees (1)
|
|
—
|
|
|
860
|
|
|
|
(100
|
)%
|
|
|
—
|
|
|
|
(100
|
)%
|
|
|||
Total revenue
|
|
670,926
|
|
|
556,723
|
|
|
|
21
|
%
|
|
|
672,320
|
|
|
|
21
|
%
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of retail merchandise sold
|
|
297,950
|
|
|
246,150
|
|
|
|
21
|
%
|
|
|
298,621
|
|
|
|
21
|
%
|
|
|||
Cost of wholesale scrap jewelry sold
|
|
30,131
|
|
|
21,656
|
|
|
|
39
|
%
|
|
|
30,191
|
|
|
|
39
|
%
|
|
|||
Consumer loan loss provision (1)
|
|
—
|
|
|
238
|
|
|
|
(100
|
)%
|
|
|
—
|
|
|
|
(100
|
)%
|
|
|||
Total cost of revenue
|
|
328,081
|
|
|
268,044
|
|
|
|
22
|
%
|
|
|
328,812
|
|
|
|
23
|
%
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net revenue
|
|
342,845
|
|
|
288,679
|
|
|
|
19
|
%
|
|
|
343,508
|
|
|
|
19
|
%
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Segment expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Store operating expenses
|
|
183,031
|
|
|
149,224
|
|
|
|
23
|
%
|
|
|
183,562
|
|
|
|
23
|
%
|
|
|||
Depreciation and amortization
|
|
14,626
|
|
|
11,333
|
|
|
|
29
|
%
|
|
|
14,687
|
|
|
|
30
|
%
|
|
|||
Total segment expenses
|
|
197,657
|
|
|
160,557
|
|
|
|
23
|
%
|
|
|
198,249
|
|
|
|
23
|
%
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Segment pre-tax operating income
|
|
$
|
145,188
|
|
|
$
|
128,122
|
|
|
|
13
|
%
|
|
|
$
|
145,259
|
|
|
|
13
|
%
|
|
(1)
|
The Company discontinued offering an unsecured consumer loan product in Latin America, effective June 30, 2018.
|
|
|
Year Ended December 31,
|
|
Increase /
|
|||||||||
|
|
2019
|
|
2018
|
|
(Decrease)
|
|||||||
Consolidated Results of Operations
|
|
|
|
|
|
|
|
|
|||||
Segment pre-tax operating income:
|
|
|
|
|
|
|
|
|
|||||
U.S. operations segment pre-tax operating income
|
|
$
|
242,134
|
|
|
$
|
242,970
|
|
|
|
—
|
%
|
|
Latin America operations segment pre-tax operating income
|
|
145,188
|
|
|
128,122
|
|
|
|
13
|
%
|
|
||
Consolidated segment pre-tax operating income
|
|
387,322
|
|
|
371,092
|
|
|
|
4
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Corporate expenses and other income:
|
|
|
|
|
|
|
|
|
|||||
Administrative expenses
|
|
122,334
|
|
|
120,042
|
|
|
|
2
|
%
|
|
||
Depreciation and amortization
|
|
6,418
|
|
|
10,607
|
|
|
|
(39
|
)%
|
|
||
Interest expense
|
|
34,035
|
|
|
29,173
|
|
|
|
17
|
%
|
|
||
Interest income
|
|
(1,055
|
)
|
|
(2,444
|
)
|
|
|
(57
|
)%
|
|
||
Merger and other acquisition expenses
|
|
1,766
|
|
|
7,643
|
|
|
|
(77
|
)%
|
|
||
(Gain) loss on foreign exchange
|
|
(787
|
)
|
|
762
|
|
|
|
203
|
%
|
|
||
Total corporate expenses and other income
|
|
162,711
|
|
|
165,783
|
|
|
|
(2
|
)%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Income before income taxes
|
|
224,611
|
|
|
205,309
|
|
|
|
9
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Provision for income taxes
|
|
59,993
|
|
|
52,103
|
|
|
|
15
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|||||
Net income
|
|
$
|
164,618
|
|
|
$
|
153,206
|
|
|
|
7
|
%
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flow provided by operating activities
|
|
$
|
231,596
|
|
|
$
|
243,429
|
|
|
$
|
220,357
|
|
Cash flow provided by (used in) investing activities
|
|
(137,053
|
)
|
|
(159,247
|
)
|
|
1,397
|
|
|||
Cash flow used in financing activities
|
|
(120,806
|
)
|
|
(127,061
|
)
|
|
(197,506
|
)
|
|
|
As of December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net working capital (1)
|
|
$
|
538,087
|
|
|
$
|
656,847
|
|
|
$
|
721,626
|
|
Current ratio (1)
|
3.7:1
|
|
5.9:1
|
|
7.0:1
|
|
||||||
Liabilities to equity (2)
|
0.8:1
|
|
0.6:1
|
|
0.4:1
|
|
||||||
Net Debt Ratio (3)
|
1.9:1
|
|
1.8:1
|
|
1.1:1
|
|
(1)
|
Current liabilities as of December 31, 2019 includes an $86.5 million current lease liability as a result of the adoption of Financial Accounting Standards Board’s new lease accounting standard that is not included in current liabilities as of December 31, 2018 and 2017, thereby impacting comparability of this metric.
|
(2)
|
Total liabilities as of December 31, 2019 includes a total of $280.0 million in lease liabilities as a result of the adoption of ASC 842 that is not included in total liabilities as of December 31, 2018 and 2017 thereby impacting comparability of this metric.
|
(3)
|
Adjusted EBITDA, a component of the Net Debt Ratio, is a non-GAAP financial measure. See “Non-GAAP Financial Information” for a calculation of the Net Debt Ratio.
|
Plan Authorization Date
|
|
Plan Completion Date
|
|
Dollar Amount Authorized
|
|
Shares Purchased in 2019
|
|
Dollar Amount Purchased in 2019
|
|
Remaining Dollar Amount Authorized For Future Purchases
|
||||||
July 25, 2018
|
|
April 23, 2019
|
|
100,000
|
|
|
496,000
|
|
|
$
|
42,760
|
|
|
$
|
—
|
|
October 24, 2018
|
|
Currently active
|
|
100,000
|
|
|
809,000
|
|
|
71,203
|
|
|
28,797
|
|
||
Total
|
|
|
|
|
|
1,305,000
|
|
|
$
|
113,963
|
|
|
$
|
28,797
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
|
In Thousands
|
|
Per Share
|
|
In Thousands
|
|
Per Share
|
|
In Thousands
|
|
Per Share
|
||||||||||||
Net income and diluted earnings per share, as reported
|
$
|
164,618
|
|
|
$
|
3.81
|
|
|
$
|
153,206
|
|
|
$
|
3.41
|
|
|
$
|
143,892
|
|
|
$
|
3.00
|
|
Adjustments, net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Merger and other acquisition expenses
|
1,276
|
|
|
0.03
|
|
|
5,412
|
|
|
0.12
|
|
|
5,710
|
|
|
0.12
|
|
||||||
Non-cash foreign currency gain related to lease liability
|
(653
|
)
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Ohio consumer lending wind-down costs and asset impairments
|
2,659
|
|
|
0.06
|
|
|
1,166
|
|
|
0.03
|
|
|
—
|
|
|
—
|
|
||||||
Net tax benefit from Tax Act
|
—
|
|
|
—
|
|
|
(1,494
|
)
|
|
(0.03
|
)
|
|
(27,269
|
)
|
|
(0.57
|
)
|
||||||
Loss on extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,892
|
|
|
0.19
|
|
||||||
Adjusted net income and diluted earnings per share
|
$
|
167,900
|
|
|
$
|
3.89
|
|
|
$
|
158,290
|
|
|
$
|
3.53
|
|
|
$
|
131,225
|
|
|
$
|
2.74
|
|
|
Year Ended December 31,
|
||||||||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||||
|
Pre-tax
|
|
Tax
|
|
After-tax
|
|
Pre-tax
|
|
Tax
|
|
After-tax
|
|
Pre-tax
|
|
Tax
|
|
After-tax
|
||||||||||||||||||
Merger and other acquisition expenses
|
$
|
1,766
|
|
|
$
|
490
|
|
|
$
|
1,276
|
|
|
$
|
7,643
|
|
|
$
|
2,231
|
|
|
$
|
5,412
|
|
|
$
|
9,062
|
|
|
$
|
3,352
|
|
|
$
|
5,710
|
|
Non-cash foreign currency gain related to lease liability
|
(933
|
)
|
|
(280
|
)
|
|
(653
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Ohio consumer lending wind-down costs and asset impairments
|
3,454
|
|
|
795
|
|
|
2,659
|
|
|
1,514
|
|
|
348
|
|
|
1,166
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Net tax benefit from Tax Act
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,494
|
|
|
(1,494
|
)
|
|
—
|
|
|
27,269
|
|
|
(27,269
|
)
|
|||||||||
Loss on extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,114
|
|
|
5,222
|
|
|
8,892
|
|
|||||||||
Total adjustments
|
$
|
4,287
|
|
|
$
|
1,005
|
|
|
$
|
3,282
|
|
|
$
|
9,157
|
|
|
$
|
4,073
|
|
|
$
|
5,084
|
|
|
$
|
23,176
|
|
|
$
|
35,843
|
|
|
$
|
(12,667
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
164,618
|
|
|
$
|
153,206
|
|
|
$
|
143,892
|
|
Income taxes
|
|
59,993
|
|
|
|
52,103
|
|
|
|
28,420
|
|
Depreciation and amortization
|
|
41,904
|
|
|
|
42,961
|
|
|
|
55,233
|
|
Interest expense
|
|
34,035
|
|
|
|
29,173
|
|
|
|
24,035
|
|
Interest income
|
|
(1,055
|
)
|
|
|
(2,444
|
)
|
|
|
(1,597
|
)
|
EBITDA
|
|
299,495
|
|
|
|
274,999
|
|
|
|
249,983
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|||
Merger and other acquisition expenses
|
|
1,766
|
|
|
|
7,643
|
|
|
|
9,062
|
|
Non-cash foreign currency gain related to lease liability
|
|
(933
|
)
|
|
|
—
|
|
|
|
—
|
|
Ohio consumer lending wind-down costs and asset impairments
|
|
3,454
|
|
|
|
1,514
|
|
|
|
—
|
|
Loss on extinguishment of debt
|
|
—
|
|
|
|
—
|
|
|
|
14,114
|
|
Adjusted EBITDA
|
$
|
303,782
|
|
|
$
|
284,156
|
|
|
$
|
273,159
|
|
|
|
|
|
|
|
|
|
|
|||
Net Debt Ratio calculation:
|
|
|
|
|
|
|
|
|
|||
Total debt (outstanding principal)
|
$
|
635,000
|
|
|
$
|
595,000
|
|
|
$
|
407,000
|
|
Less: cash and cash equivalents
|
|
(46,527
|
)
|
|
|
(71,793
|
)
|
|
|
(114,423
|
)
|
Net debt
|
$
|
588,473
|
|
|
$
|
523,207
|
|
|
$
|
292,577
|
|
Adjusted EBITDA
|
$
|
303,782
|
|
|
$
|
284,156
|
|
|
$
|
273,159
|
|
Net Debt Ratio (Net Debt divided by Adjusted EBITDA)
|
1.9
|
:1
|
|
1.8
|
:1
|
|
1.1
|
:1
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flow from operating activities
|
$
|
231,596
|
|
|
$
|
243,429
|
|
|
$
|
220,357
|
|
Cash flow from investing activities:
|
|
|
|
|
|
|
|
|
|||
Loan receivables, net of cash repayments
|
|
34,406
|
|
|
|
10,125
|
|
|
|
40,735
|
|
Purchases of furniture, fixtures, equipment and improvements
|
|
(44,311
|
)
|
|
|
(35,677
|
)
|
|
|
(25,971
|
)
|
Free cash flow
|
|
221,691
|
|
|
|
217,877
|
|
|
|
235,121
|
|
Merger and other acquisition expenses paid, net of tax benefit
|
|
1,276
|
|
|
|
7,072
|
|
|
|
6,659
|
|
Adjusted free cash flow
|
$
|
222,967
|
|
|
$
|
224,949
|
|
|
$
|
241,780
|
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less Than 1 Year
|
|
1 - 3 Years
|
|
3 - 5 Years
|
|
More Than 5 Years
|
||||||||||
Operating leases
|
$
|
325,100
|
|
|
$
|
105,118
|
|
|
$
|
145,231
|
|
|
$
|
59,274
|
|
|
$
|
15,477
|
|
Revolving unsecured credit facility (1)
|
335,000
|
|
|
—
|
|
|
—
|
|
|
335,000
|
|
|
—
|
|
|||||
Senior unsecured notes
|
300,000
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|
—
|
|
|||||
Interest on senior unsecured notes
|
72,563
|
|
|
16,125
|
|
|
32,250
|
|
|
24,188
|
|
|
—
|
|
|||||
Executive employment contracts (2)
|
8,913
|
|
|
4,298
|
|
|
4,615
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
1,041,576
|
|
|
$
|
125,541
|
|
|
$
|
182,096
|
|
|
$
|
718,462
|
|
|
$
|
15,477
|
|
(1)
|
Excludes interest obligations under the Company's revolving unsecured credit facility. See Note 10 of Notes to Consolidated Financial Statements.
|
(2)
|
The employment contracts provide for certain severance payments and other benefits in the event of the executive’s termination of employment or a change in control of the Company. Further information regarding the executive employment contracts is provided under the heading “Executive Compensation - Employment Agreements and Change in Control Provisions” of the 2020 Proxy Statement.
|
(a)
|
The following documents are filed as part of this report:
|
|
|||
|
(1)
|
Consolidated Financial Statements:
|
Page
|
|
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
|
|
Consolidated Balance Sheets
|
|
|
|
|
|
Consolidated Statements of Income
|
|
|
|
|
|
Consolidated Statements of Comprehensive Income
|
|
|
|
|
|
Consolidated Statements of Changes in Stockholders’ Equity
|
|
|
|
|
|
Consolidated Statements of Cash Flows
|
|
|
|
|
|
Notes to Consolidated Financial Statements
|
|
|
|
|
|
|
|
|
|
(2)
|
All schedules are omitted because they are not applicable or the required information is shown in the financial statements or the notes thereto.
|
|||
|
|
|
|
|
|
|
(3)
|
Exhibits:
|
|
|
|
|
Incorporated by Reference
|
|
|
||||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
Filed Herewith
|
3.1
|
|
|
DEF 14A
|
|
0-19133
|
|
B
|
|
04/29/2004
|
|
|
|
3.2
|
|
|
8-K
|
|
001-10960
|
|
3.1
|
|
09/02/2016
|
|
|
|
3.3
|
|
|
8-K
|
|
001-10960
|
|
3.1
|
|
04/24/2019
|
|
|
|
4.1
|
|
Common Stock Specimen
|
|
S-1
|
|
33-48436
|
|
4.2a
|
|
06/05/1992
|
|
|
4.2
|
|
|
8-K
|
|
001-10960
|
|
4.1
|
|
05/31/2017
|
|
|
|
4.3
|
|
|
|
|
|
|
|
|
|
|
X
|
|
10.1
|
|
|
DEF 14A
|
|
0-19133
|
|
C
|
|
04/29/2004
|
|
|
|
10.2
|
|
|
DEF 14A
|
|
0-19133
|
|
A
|
|
04/28/2011
|
|
|
|
10.3
|
|
|
S-8
|
|
333-
214452
|
|
99.2
|
|
11/04/2016
|
|
|
|
10.4
|
|
|
S-8
|
|
333- 106881
|
|
4(g)
|
|
05/31/2012
|
|
|
|
10.5
|
|
|
8-K
|
|
0-19133
|
|
10.1
|
|
07/26/2016
|
|
|
|
10.6
|
|
|
8-K
|
|
0-19133
|
|
10.1
|
|
08/26/2016
|
|
|
|
10.7
|
|
|
8-K
|
|
0-19133
|
|
10.2
|
|
08/26/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
||||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
Filed Herewith
|
10.8
|
|
|
8-K
|
|
0-19133
|
|
10.3
|
|
08/26/2016
|
|
|
|
10.9
|
|
|
10-Q
|
|
001-10960
|
|
10.1
|
|
05/05/2017
|
|
|
|
10.10
|
|
|
8-K
|
|
001-10960
|
|
10.1
|
|
05/31/2017
|
|
|
|
10.11
|
|
|
10-Q
|
|
001-10960
|
|
10.1
|
|
08/01/2018
|
|
|
|
10.12
|
|
|
10-Q
|
|
001-10960
|
|
10.2
|
|
08/01/2018
|
|
|
|
10.13
|
|
|
8-K
|
|
001-10960
|
|
10.1
|
|
10/04/2018
|
|
|
|
10.14
|
|
|
DEF 14A
|
|
001-10960
|
|
B
|
|
04/26/2019
|
|
|
|
10.15
|
|
|
8-K
|
|
001-10960
|
|
10.1
|
|
12/19/2019
|
|
|
|
10.16
|
|
|
|
|
|
|
|
|
|
|
X
|
|
21.1
|
|
|
|
|
|
|
|
|
|
|
X
|
|
23.1
|
|
|
|
|
|
|
|
|
|
|
X
|
|
31.1
|
|
|
|
|
|
|
|
|
|
|
X
|
|
31.2
|
|
|
|
|
|
|
|
|
|
|
X
|
|
32.1
|
|
|
|
|
|
|
|
|
|
|
X
|
|
32.2
|
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
||||||
Exhibit No.
|
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
Filed Herewith
|
101.INS
|
|
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
|
|
|
|
|
|
|
|
|
X
|
101.SCH
|
|
Inline XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
X
|
101.CAL
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.DEF
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.LAB
|
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.PRE
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
104
|
|
Cover Page Interactive Data File (embedded within the Inline XBRL document contained in Exhibit 101)
|
|
|
|
|
|
|
|
|
|
X
|
*
|
The schedules to the Agreement and Plan of Merger have been omitted from this filing pursuant to Item 601(b)(2) of Regulation S-K. Registrant will furnish copies of such schedules to the U.S. Securities and Exchange Commission upon request by the Commission.
|
**
|
Indicates management contract or compensatory plan, contract or arrangement.
|
|
|
Dated: February 3, 2020
|
FIRSTCASH, INC.
|
|
(Registrant)
|
|
|
|
/s/ RICK L. WESSEL
|
|
Rick L. Wessel
|
|
Chief Executive Officer
|
|
(On behalf of the Registrant)
|
Signature
|
Capacity
|
Date
|
|
|
|
/s/ RICK L. WESSEL
Rick L. Wessel
|
Vice-Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
|
February 3, 2020
|
|
|
|
/s/ R. DOUGLAS ORR
R. Douglas Orr
|
Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
|
February 3, 2020
|
|
|
|
/s/ DANIEL R. FEEHAN
Daniel R. Feehan |
Chairman of the Board
|
February 3, 2020
|
|
|
|
/s/ DANIEL E. BERCE
Daniel E. Berce
|
Director
|
February 3, 2020
|
|
|
|
/s/ MIKEL D. FAULKNER
Mikel D. Faulkner
|
Director
|
February 3, 2020
|
|
|
|
/s/ JAMES H. GRAVES
James H. Graves
|
Director
|
February 3, 2020
|
|
|
|
/s/ RANDEL G. OWEN
Randel G. Owen
|
Director
|
February 3, 2020
|
•
|
We obtained an understanding of the relevant controls related to the accrual of pawn loan fees and tested such controls for design and operating effectiveness, including the determination of key assumptions and data inputs.
|
•
|
We obtained management’s calculation of the accrual for pawn loan fees and tested the calculation for completeness and accuracy of data used as inputs.
|
•
|
We evaluated the methodology and assumptions used by management to develop the effective pawn loan yield, including consideration of historical patterns and the probability of collection.
|
•
|
We independently recalculated certain key inputs used in management’s calculation of the accrual for pawn loan fees.
|
•
|
We assessed the validity of data used in the calculation of the accrual for pawn loan fees by agreeing, on a sample basis, key data inputs to source documents
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net income
|
$
|
164,618
|
|
|
$
|
153,206
|
|
|
$
|
143,892
|
|
|
|
|
|
|
|
||||||
Denominator:
|
|
|
|
|
|
||||||
Weighted-average common shares for calculating basic earnings per share
|
43,020
|
|
|
44,777
|
|
|
47,854
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Stock options and restricted stock unit awards
|
188
|
|
|
107
|
|
|
34
|
|
|||
Weighted-average common shares for calculating diluted earnings per share
|
43,208
|
|
|
44,884
|
|
|
47,888
|
|
|||
|
|
|
|
|
|
||||||
Earnings per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
3.83
|
|
|
$
|
3.42
|
|
|
$
|
3.01
|
|
Diluted
|
3.81
|
|
|
3.41
|
|
|
3.00
|
|
Pawn loans
|
$
|
9,991
|
|
Pawn loan fees receivable
|
815
|
|
|
Inventories
|
6,729
|
|
|
Other current assets
|
259
|
|
|
Property and equipment
|
1,642
|
|
|
Goodwill (1)
|
27,306
|
|
|
Intangible assets (2)
|
545
|
|
|
Current liabilities
|
(523
|
)
|
|
Aggregate purchase price
|
$
|
46,764
|
|
(1)
|
Goodwill associated with the U.S. operations segment and the Latin America operations segment was $11.8 million and $15.5 million, respectively. Substantially all of the goodwill is expected to be deductible for respective U.S. and Mexico income tax purposes.
|
(2)
|
Intangible assets primarily consist of customer relationships, which are generally amortized over five years.
|
Initial measurement of operating lease right of use asset (present value of the future minimum lease payments)
|
$
|
295,063
|
|
Accrued straight-line rent liability (1)
|
(4,237
|
)
|
|
Amounts previously recognized in respect of business combinations:
|
|
||
Favorable lease intangible assets (2)
|
45,596
|
|
|
Unfavorable lease intangible liabilities (3)
|
(17,275
|
)
|
|
Total initial operating lease right of use asset
|
$
|
319,147
|
|
|
|
||
Lease liability, current
|
$
|
(87,608
|
)
|
Lease liability, non-current
|
(207,455
|
)
|
|
Total initial lease liability (present value of the future minimum lease payments)
|
$
|
(295,063
|
)
|
(1)
|
Included in accounts payable and accrued liabilities in the accompanying consolidated balance sheet as of December 31, 2018.
|
(2)
|
Included in prepaid expenses and other current assets and other assets in the accompanying consolidated balance sheet as of December 31, 2018.
|
(3)
|
Included in accounts payable and accrued liabilities and other liabilities in the accompanying consolidated balance sheet as of December 31, 2018.
|
Operating lease expense (1)
|
$
|
124,082
|
|
Variable lease expense (2)
|
7,775
|
|
|
Total operating lease expense
|
$
|
131,857
|
|
(1)
|
Includes $0.8 million of net amortization related to the favorable/unfavorable lease intangible assets/liabilities that were reclassified to the operating lease right of use asset in the accompanying consolidated balance sheets upon adoption of ASC 842 on January 1, 2019.
|
(2)
|
Variable lease costs consist primarily of taxes, insurance and common area or other maintenance costs paid based on actual costs incurred by the lessor and can therefore vary over the lease term.
|
2020
|
$
|
105,118
|
|
2021
|
84,541
|
|
|
2022
|
60,690
|
|
|
2023
|
40,514
|
|
|
2024
|
18,760
|
|
|
Thereafter
|
15,477
|
|
|
Total
|
$
|
325,100
|
|
Less amount of lease payments representing interest
|
(45,130
|
)
|
|
Total present value of lease payments
|
$
|
279,970
|
|
Cash paid for amounts included in the measurement of operating lease liabilities
|
$
|
116,448
|
|
Leased assets obtained in exchange for new operating lease liabilities
|
$
|
71,117
|
|
Plan Authorization Date
|
|
Plan Completion Date
|
|
Dollar Amount Authorized
|
|
Shares Purchased in 2019
|
|
Dollar Amount Purchased in 2019
|
|
Remaining Dollar Amount Authorized For Future Purchases
|
|||||||
July 25, 2018
|
|
April 23, 2019
|
|
$
|
100,000
|
|
|
496,000
|
|
|
$
|
42,760
|
|
|
$
|
—
|
|
October 24, 2018
|
|
Currently active
|
|
100,000
|
|
|
809,000
|
|
|
71,203
|
|
|
28,797
|
|
|||
Total
|
|
|
|
|
|
1,305,000
|
|
|
$
|
113,963
|
|
|
$
|
28,797
|
|
|
|
Carrying Value
|
|
Estimated Fair Value
|
||||||||||||||||
|
|
December 31,
|
|
December 31,
|
|
Fair Value Measurements Using
|
||||||||||||||
|
|
2019
|
|
2019
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
46,527
|
|
|
$
|
46,527
|
|
|
$
|
46,527
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Fees and service charges receivable
|
|
46,686
|
|
|
46,686
|
|
|
—
|
|
|
—
|
|
|
46,686
|
|
|||||
Pawn loans
|
|
369,527
|
|
|
369,527
|
|
|
—
|
|
|
—
|
|
|
369,527
|
|
|||||
Consumer loans, net
|
|
751
|
|
|
751
|
|
|
—
|
|
|
—
|
|
|
751
|
|
|||||
|
|
$
|
463,491
|
|
|
$
|
463,491
|
|
|
$
|
46,527
|
|
|
$
|
—
|
|
|
$
|
416,964
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revolving unsecured credit facility
|
|
$
|
335,000
|
|
|
$
|
335,000
|
|
|
$
|
—
|
|
|
$
|
335,000
|
|
|
$
|
—
|
|
Senior unsecured notes (outstanding principal)
|
|
300,000
|
|
|
310,000
|
|
|
—
|
|
|
310,000
|
|
|
—
|
|
|||||
|
|
$
|
635,000
|
|
|
$
|
645,000
|
|
|
$
|
—
|
|
|
$
|
645,000
|
|
|
$
|
—
|
|
|
|
Carrying Value
|
|
Estimated Fair Value
|
||||||||||||||||
|
|
December 31,
|
|
December 31,
|
|
Fair Value Measurements Using
|
||||||||||||||
|
|
2018
|
|
2018
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
71,793
|
|
|
$
|
71,793
|
|
|
$
|
71,793
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Fees and service charges receivable
|
|
45,430
|
|
|
45,430
|
|
|
—
|
|
|
—
|
|
|
45,430
|
|
|||||
Pawn loans
|
|
362,941
|
|
|
362,941
|
|
|
—
|
|
|
—
|
|
|
362,941
|
|
|||||
Consumer loans, net
|
|
15,902
|
|
|
15,902
|
|
|
—
|
|
|
—
|
|
|
15,902
|
|
|||||
|
|
$
|
496,066
|
|
|
$
|
496,066
|
|
|
$
|
71,793
|
|
|
$
|
—
|
|
|
$
|
424,273
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revolving unsecured credit facility
|
|
$
|
295,000
|
|
|
$
|
295,000
|
|
|
$
|
—
|
|
|
$
|
295,000
|
|
|
$
|
—
|
|
Senior unsecured notes (outstanding principal)
|
|
300,000
|
|
|
293,000
|
|
|
—
|
|
|
293,000
|
|
|
—
|
|
|||||
|
|
$
|
595,000
|
|
|
$
|
588,000
|
|
|
$
|
—
|
|
|
$
|
588,000
|
|
|
$
|
—
|
|
December 31, 2019
|
|
||
Total consumer loans
|
$
|
785
|
|
Less allowance for doubtful accounts
|
(34
|
)
|
|
Consumer loans, net
|
$
|
751
|
|
|
|
||
December 31, 2018
|
|
||
Total consumer loans
|
$
|
16,785
|
|
Less allowance for doubtful accounts
|
(883
|
)
|
|
Consumer loans, net
|
$
|
15,902
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at beginning of year
|
$
|
883
|
|
|
$
|
1,815
|
|
|
$
|
2,251
|
|
Provision for credit losses
|
2,395
|
|
|
9,405
|
|
|
12,762
|
|
|||
Charge-offs, net of recoveries from customers
|
(3,244
|
)
|
|
(10,337
|
)
|
|
(13,198
|
)
|
|||
Balance at end of year
|
$
|
34
|
|
|
$
|
883
|
|
|
$
|
1,815
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Balance at beginning of year
|
$
|
252
|
|
|
$
|
440
|
|
|
$
|
582
|
|
Provision for credit losses
|
1,764
|
|
|
8,056
|
|
|
7,057
|
|
|||
Amounts paid to Independent Lenders under guarantees, net of recoveries from customers
|
(1,926
|
)
|
|
(8,244
|
)
|
|
(7,199
|
)
|
|||
Balance at end of year
|
$
|
90
|
|
|
$
|
252
|
|
|
$
|
440
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
Land
|
$
|
66,198
|
|
|
$
|
37,578
|
|
Buildings
|
123,397
|
|
|
76,406
|
|
||
Furniture, fixtures, equipment and improvements
|
398,905
|
|
|
348,620
|
|
||
|
588,500
|
|
|
462,604
|
|
||
Less: accumulated depreciation
|
(252,333
|
)
|
|
(210,959
|
)
|
||
|
$
|
336,167
|
|
|
$
|
251,645
|
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
Accrued compensation
|
$
|
27,738
|
|
|
$
|
28,130
|
|
Sales, property, and payroll withholding taxes payable
|
15,237
|
|
|
12,563
|
|
||
Acquisition purchase price amounts payable to sellers
|
6,374
|
|
|
12,636
|
|
||
Trade accounts payable
|
5,871
|
|
|
6,886
|
|
||
Benefits liabilities and withholding payable
|
3,353
|
|
|
3,541
|
|
||
Accrued interest payable
|
1,459
|
|
|
1,534
|
|
||
Liability for expected losses on outstanding guarantees from CSO Program
|
90
|
|
|
252
|
|
||
Deferred fees from CSO Program
|
28
|
|
|
4,501
|
|
||
Current unfavorable lease intangible liability (1)
|
—
|
|
|
6,191
|
|
||
Other accrued liabilities
|
12,248
|
|
|
20,694
|
|
||
|
$
|
72,398
|
|
|
$
|
96,928
|
|
(1)
|
Current unfavorable lease intangible liability was reclassified to operating lease right of use asset on January 1, 2019 in conjunction with the adoption of ASC 842. See Note 4.
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
Revolving unsecured credit facility, maturing 2024 (1)
|
$
|
335,000
|
|
|
$
|
295,000
|
|
5.375% senior unsecured notes due 2024 (2)
|
296,568
|
|
|
295,887
|
|
||
Total long-term debt
|
$
|
631,568
|
|
|
$
|
590,887
|
|
(1)
|
Debt issuance costs related to the Company’s revolving unsecured credit facility are included in other assets in the accompanying consolidated balance sheets.
|
(2)
|
As of December 31, 2019 and 2018, deferred debt issuance costs of $3.4 million and $4.1 million, respectively, are included as a direct deduction from the carrying amount of the senior unsecured notes in the accompanying consolidated balance sheets.
|
2020
|
$
|
—
|
|
2021
|
—
|
|
|
2022
|
—
|
|
|
2023
|
—
|
|
|
2024
|
635,000
|
|
|
Thereafter
|
—
|
|
|
|
$
|
635,000
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Income before income taxes (1):
|
|
|
|
|
|
||||||
Domestic
|
$
|
145,570
|
|
|
$
|
125,056
|
|
|
$
|
93,365
|
|
Foreign
|
79,041
|
|
|
80,253
|
|
|
78,947
|
|
|||
Income before income taxes
|
$
|
224,611
|
|
|
$
|
205,309
|
|
|
$
|
172,312
|
|
|
|
|
|
|
|
||||||
Current income taxes:
|
|
|
|
|
|
||||||
Federal (2)
|
$
|
26,624
|
|
|
$
|
18,751
|
|
|
$
|
15,995
|
|
Foreign
|
21,904
|
|
|
23,231
|
|
|
23,340
|
|
|||
State and local
|
2,553
|
|
|
2,506
|
|
|
968
|
|
|||
Current provision for income taxes
|
51,081
|
|
|
44,488
|
|
|
40,303
|
|
|||
|
|
|
|
|
|
||||||
Deferred provision (benefit) for income taxes:
|
|
|
|
|
|
||||||
Federal (3)
|
7,498
|
|
|
7,621
|
|
|
(11,509
|
)
|
|||
Foreign
|
863
|
|
|
(566
|
)
|
|
(1,079
|
)
|
|||
State and local
|
551
|
|
|
560
|
|
|
705
|
|
|||
Total deferred provision (benefit) for income taxes
|
8,912
|
|
|
7,615
|
|
|
(11,883
|
)
|
|||
|
|
|
|
|
|
||||||
Provision for income taxes
|
$
|
59,993
|
|
|
$
|
52,103
|
|
|
$
|
28,420
|
|
(1)
|
Includes the allocation of certain administrative expenses and intercompany payments, such as royalties and interest, between domestic and foreign subsidiaries.
|
(2)
|
The year ended December 31, 2017 includes a provisional $1.9 million income tax expense relating to the one-time mandatory tax on previously deferred earnings of the Company’s foreign subsidiaries as a result of the Tax Cuts and Jobs Act (“Tax Act”). The year ended December 31, 2018 includes a $1.5 million income tax benefit as a result of the Company’s finalization of certain estimates and tax positions used to record the 2017 provisional tax expense. The years ended December 31, 2019 and 2018 include $1.1 million and $0.8 million of income tax expense, respectively, relating to the global intangible low-taxed income (GILTI) inclusion.
|
(3)
|
The year ended December 31, 2017 includes a provisional $29.2 million income tax benefit resulting from the remeasurement of the Company’s domestic net deferred tax liabilities based on the lower corporate income tax rate as a result of the Tax Act. During 2018, the Company finalized certain estimates and tax positions used in the analysis of the 2017 provisional tax benefit resulting in no adjustments.
|
|
As of December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
||||
Property and equipment
|
$
|
10,407
|
|
|
$
|
8,073
|
|
Accrued fees on forfeited pawn loans
|
8,006
|
|
|
7,489
|
|
||
Deferred cost of goods sold deduction
|
5,721
|
|
|
3,494
|
|
||
Accrued compensation and employee benefits
|
2,163
|
|
|
1,912
|
|
||
State net operating losses
|
6,012
|
|
|
6,430
|
|
||
Other
|
4,428
|
|
|
6,027
|
|
||
Total deferred tax assets
|
36,737
|
|
|
33,425
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Intangible assets
|
71,814
|
|
|
66,734
|
|
||
Net operating lease asset
|
5,819
|
|
|
—
|
|
||
Property and equipment
|
—
|
|
|
1,668
|
|
||
Other
|
2,812
|
|
|
1,807
|
|
||
Total deferred tax liabilities
|
80,445
|
|
|
70,209
|
|
||
|
|
|
|
||||
Net deferred tax liabilities before valuation allowance
|
(43,708
|
)
|
|
(36,784
|
)
|
||
Valuation allowance
|
(6,012
|
)
|
|
(6,430
|
)
|
||
Net deferred tax liabilities
|
$
|
(49,720
|
)
|
|
$
|
(43,214
|
)
|
|
|
|
|
||||
Reported as:
|
|
|
|
||||
Deferred tax assets
|
$
|
11,711
|
|
|
$
|
11,640
|
|
Deferred tax liabilities
|
(61,431
|
)
|
|
(54,854
|
)
|
||
Net deferred tax liabilities
|
$
|
(49,720
|
)
|
|
$
|
(43,214
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
U.S. federal statutory rate
|
21
|
%
|
|
21
|
%
|
|
35
|
%
|
|||
|
|
|
|
|
|
||||||
Tax at the U.S. federal statutory rate
|
$
|
47,168
|
|
|
$
|
43,115
|
|
|
$
|
60,309
|
|
State income tax, net of federal tax benefit of $652, $644 and $586, respectively
|
2,452
|
|
|
2,422
|
|
|
1,087
|
|
|||
Net incremental income tax expense (benefit) from foreign earnings (1)
|
6,314
|
|
|
6,031
|
|
|
(5,442
|
)
|
|||
Net tax benefit resulting from the enactment of the Tax Act
|
—
|
|
|
(1,494
|
)
|
|
(27,269
|
)
|
|||
Non-deductible compensation expense
|
2,074
|
|
|
1,827
|
|
|
—
|
|
|||
Other taxes and adjustments, net
|
1,985
|
|
|
202
|
|
|
(265
|
)
|
|||
Provision for income taxes
|
$
|
59,993
|
|
|
$
|
52,103
|
|
|
$
|
28,420
|
|
|
|
|
|
|
|
||||||
Effective tax rate
|
26.7
|
%
|
|
25.4
|
%
|
|
16.5
|
%
|
(1)
|
Includes a $2.3 million, $3.3 million and $4.0 million foreign permanent tax benefit related to an inflation index adjustment allowed under Mexico tax law for the years ended December 31, 2019, 2018 and 2017, respectively.
|
December 31, 2019
|
U.S. operations segment
|
|
Latin America operations segment
|
|
Total
|
||||||
Balance, beginning of year
|
$
|
759,538
|
|
|
$
|
157,881
|
|
|
$
|
917,419
|
|
Acquisitions (see Note 3)
|
11,773
|
|
|
15,533
|
|
|
27,306
|
|
|||
Effect of foreign currency translation
|
—
|
|
|
5,175
|
|
|
5,175
|
|
|||
Other adjustments
|
—
|
|
|
(1,257
|
)
|
|
(1,257
|
)
|
|||
Balance, end of year
|
$
|
771,311
|
|
|
$
|
177,332
|
|
|
$
|
948,643
|
|
|
|
|
|
|
|
||||||
December 31, 2018
|
|
|
|
|
|
||||||
Balance, beginning of year
|
$
|
743,997
|
|
|
$
|
87,148
|
|
|
$
|
831,145
|
|
Acquisitions (see Note 3)
|
15,541
|
|
|
71,427
|
|
|
86,968
|
|
|||
Effect of foreign currency translation
|
—
|
|
|
(694
|
)
|
|
(694
|
)
|
|||
Balance, end of year
|
$
|
759,538
|
|
|
$
|
157,881
|
|
|
$
|
917,419
|
|
|
|
As of December 31,
|
||||||||||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||||||||||
|
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Customer relationships
|
|
$
|
25,899
|
|
|
$
|
(21,681
|
)
|
|
$
|
4,218
|
|
|
$
|
25,453
|
|
|
$
|
(18,955
|
)
|
|
$
|
6,498
|
|
Executive non-compete agreements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,700
|
|
|
(8,700
|
)
|
|
—
|
|
||||||
|
|
$
|
25,899
|
|
|
$
|
(21,681
|
)
|
|
$
|
4,218
|
|
|
$
|
34,153
|
|
|
$
|
(27,655
|
)
|
|
$
|
6,498
|
|
2020
|
$
|
2,368
|
|
2021
|
1,300
|
|
|
2022
|
299
|
|
|
2023
|
231
|
|
|
2024
|
20
|
|
|
|
$
|
4,218
|
|
|
|
As of December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Trade names
|
|
$
|
46,300
|
|
|
$
|
46,300
|
|
Pawn licenses (1)
|
|
34,107
|
|
|
34,092
|
|
||
Other indefinite-lived intangibles
|
|
1,250
|
|
|
1,250
|
|
||
|
|
$
|
81,657
|
|
|
$
|
81,642
|
|
(1)
|
Costs to renew licenses with indefinite lives are expensed as incurred and recorded in store operating expenses in the consolidated statements of income.
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
|
|
|
Weighted-
|
|
|
|
Weighted-
|
|
|
|
Weighted-
|
|||||||||
|
|
|
Average
|
|
|
|
Average
|
|
|
|
Average
|
|||||||||
|
Underlying
|
|
Fair Value
|
|
Underlying
|
|
Fair Value
|
|
Underlying
|
|
Fair Value
|
|||||||||
|
Shares
|
|
of Grant
|
|
Shares
|
|
of Grant
|
|
Shares
|
|
of Grant
|
|||||||||
Outstanding at beginning of year
|
254
|
|
|
$
|
59.53
|
|
|
157
|
|
|
$
|
47.36
|
|
|
30
|
|
|
$
|
45.93
|
|
Performance-based grants (1)
|
109
|
|
|
86.86
|
|
|
102
|
|
|
72.70
|
|
|
117
|
|
|
48.25
|
|
|||
Time-based grants
|
19
|
|
|
86.86
|
|
|
17
|
|
|
72.70
|
|
|
20
|
|
|
43.55
|
|
|||
Performance-based vested
|
(10
|
)
|
|
45.93
|
|
|
(10
|
)
|
|
45.93
|
|
|
(10
|
)
|
|
45.93
|
|
|||
Time-based vested
|
(15
|
)
|
|
73.78
|
|
|
(12
|
)
|
|
43.55
|
|
|
—
|
|
|
—
|
|
|||
Outstanding at end of year
|
357
|
|
|
$
|
69.13
|
|
|
254
|
|
|
$
|
59.53
|
|
|
157
|
|
|
$
|
47.36
|
|
(1)
|
Represents the maximum possible award. The Company’s level of achievement of the respective performance goals will result in actual vesting of between zero shares and the maximum share award.
|
|
|
|
|
|
|
Weighted-Average
|
|
Currently
|
||||||||
Exercise Price
|
|
Option Shares
|
|
Remaining Life
|
|
Exercisable Shares
|
||||||||||
|
$
|
38.00
|
|
|
|
|
40
|
|
|
|
1.9
|
|
|
20
|
|
|
|
40.00
|
|
|
|
|
30
|
|
|
|
1.0
|
|
|
20
|
|
|
|
|
|
|
|
|
70
|
|
|
|
1.5
|
|
|
40
|
|
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
|
|
|
Weighted-
|
|
|
|
Weighted-
|
|
|
|
Weighted-
|
|||||||||
|
|
|
Average
|
|
|
|
Average
|
|
|
|
Average
|
|||||||||
|
Underlying
|
|
Exercise
|
|
Underlying
|
|
Exercise
|
|
Underlying
|
|
Exercise
|
|||||||||
|
Shares
|
|
Price
|
|
Shares
|
|
Price
|
|
Shares
|
|
Price
|
|||||||||
Outstanding at beginning of year
|
80
|
|
|
$
|
39.00
|
|
|
90
|
|
|
$
|
39.11
|
|
|
103
|
|
|
$
|
37.34
|
|
Exercised
|
(10
|
)
|
|
40.00
|
|
|
(10
|
)
|
|
40.00
|
|
|
(13
|
)
|
|
24.57
|
|
|||
Outstanding at end of year
|
70
|
|
|
38.86
|
|
|
80
|
|
|
39.00
|
|
|
90
|
|
|
39.11
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Exercisable at end of year
|
40
|
|
|
39.00
|
|
|
30
|
|
|
39.33
|
|
|
20
|
|
|
40.00
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Gross compensation costs:
|
|
|
|
|
|
||||||
Restricted stock unit awards
|
$
|
8,637
|
|
|
$
|
5,712
|
|
|
$
|
2,959
|
|
Stock options
|
43
|
|
|
74
|
|
|
110
|
|
|||
Total gross compensation costs
|
8,680
|
|
|
5,786
|
|
|
3,069
|
|
|||
|
|
|
|
|
|
||||||
Income tax benefits:
|
|
|
|
|
|
||||||
Restricted stock unit awards
|
(302
|
)
|
|
(1,320
|
)
|
|
(1,036
|
)
|
|||
Exercise of stock options
|
(114
|
)
|
|
(94
|
)
|
|
(39
|
)
|
|||
Total income tax benefits
|
(416
|
)
|
|
(1,414
|
)
|
|
(1,075
|
)
|
|||
|
|
|
|
|
|
||||||
Net compensation expense
|
$
|
8,264
|
|
|
$
|
4,372
|
|
|
$
|
1,994
|
|
•
|
U.S. operations - Includes all pawn and unsecured consumer loan operations in the U.S.
|
•
|
Latin America operations - Includes all pawn operations in Latin America, which includes operations in Mexico, Guatemala, El Salvador and Colombia.
|
|
|
Year Ended December 31, 2019
|
||||||||||||||
|
|
U.S.
Operations
|
|
Latin America
Operations
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||
Retail merchandise sales
|
|
$
|
722,127
|
|
|
$
|
453,434
|
|
|
$
|
—
|
|
|
$
|
1,175,561
|
|
Pawn loan fees
|
|
379,395
|
|
|
185,429
|
|
|
—
|
|
|
564,824
|
|
||||
Wholesale scrap jewelry sales
|
|
71,813
|
|
|
32,063
|
|
|
—
|
|
|
103,876
|
|
||||
Consumer loan and credit services fees (1)
|
|
20,178
|
|
|
—
|
|
|
—
|
|
|
20,178
|
|
||||
Total revenue
|
|
1,193,513
|
|
|
670,926
|
|
|
—
|
|
|
1,864,439
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
||||||||
Cost of retail merchandise sold
|
|
447,911
|
|
|
297,950
|
|
|
—
|
|
|
745,861
|
|
||||
Cost of wholesale scrap jewelry sold
|
|
65,941
|
|
|
30,131
|
|
|
—
|
|
|
96,072
|
|
||||
Consumer loan and credit services loss provision (1)
|
|
4,159
|
|
|
—
|
|
|
—
|
|
|
4,159
|
|
||||
Total cost of revenue
|
|
518,011
|
|
|
328,081
|
|
|
—
|
|
|
846,092
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net revenue
|
|
675,502
|
|
|
342,845
|
|
|
—
|
|
|
1,018,347
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses and other income:
|
|
|
|
|
|
|
|
|
||||||||
Store operating expenses
|
|
412,508
|
|
|
183,031
|
|
|
—
|
|
|
595,539
|
|
||||
Administrative expenses
|
|
—
|
|
|
—
|
|
|
122,334
|
|
|
122,334
|
|
||||
Depreciation and amortization
|
|
20,860
|
|
|
14,626
|
|
|
6,418
|
|
|
41,904
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
34,035
|
|
|
34,035
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
(1,055
|
)
|
|
(1,055
|
)
|
||||
Merger and other acquisition expenses
|
|
—
|
|
|
—
|
|
|
1,766
|
|
|
1,766
|
|
||||
Loss on foreign exchange
|
|
—
|
|
|
—
|
|
|
(787
|
)
|
|
(787
|
)
|
||||
Total expenses and other income
|
|
433,368
|
|
|
197,657
|
|
|
162,711
|
|
|
793,736
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income taxes
|
|
$
|
242,134
|
|
|
$
|
145,188
|
|
|
$
|
(162,711
|
)
|
|
$
|
224,611
|
|
|
|
As of December 31, 2019
|
||||||||||||||
|
|
U.S.
Operations |
|
Latin America
Operations |
|
Corporate
|
|
Consolidated
|
||||||||
Pawn loans
|
|
$
|
268,793
|
|
|
$
|
100,734
|
|
|
$
|
—
|
|
|
$
|
369,527
|
|
Consumer loans, net (1)
|
|
751
|
|
|
—
|
|
|
—
|
|
|
751
|
|
||||
Inventories
|
|
181,320
|
|
|
83,936
|
|
|
—
|
|
|
265,256
|
|
||||
Goodwill
|
|
771,311
|
|
|
177,332
|
|
|
—
|
|
|
948,643
|
|
||||
Total assets
|
|
1,767,504
|
|
|
574,059
|
|
|
97,877
|
|
|
2,439,440
|
|
(1)
|
The Company ceased offering unsecured consumer lending and credit services products in all of its Ohio locations on April 26, 2019 and closed 52 Ohio locations during the second quarter of 2019.
|
|
|
Year Ended December 31, 2018
|
||||||||||||||
|
|
U.S.
Operations
|
|
Latin America
Operations
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||
Retail merchandise sales
|
|
$
|
709,594
|
|
|
$
|
382,020
|
|
|
$
|
—
|
|
|
$
|
1,091,614
|
|
Pawn loan fees
|
|
373,406
|
|
|
151,740
|
|
|
—
|
|
|
525,146
|
|
||||
Wholesale scrap jewelry sales
|
|
85,718
|
|
|
22,103
|
|
|
—
|
|
|
107,821
|
|
||||
Consumer loan and credit services fees (1)
|
|
55,417
|
|
|
860
|
|
|
—
|
|
|
56,277
|
|
||||
Total revenue
|
|
1,224,135
|
|
|
556,723
|
|
|
—
|
|
|
1,780,858
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
||||||||
Cost of retail merchandise sold
|
|
450,516
|
|
|
246,150
|
|
|
—
|
|
|
696,666
|
|
||||
Cost of wholesale scrap jewelry sold
|
|
78,308
|
|
|
21,656
|
|
|
—
|
|
|
99,964
|
|
||||
Consumer loan and credit services loss provision (1)
|
|
17,223
|
|
|
238
|
|
|
—
|
|
|
17,461
|
|
||||
Total cost of revenue
|
|
546,047
|
|
|
268,044
|
|
|
—
|
|
|
814,091
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net revenue
|
|
678,088
|
|
|
288,679
|
|
|
—
|
|
|
966,767
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses and other income:
|
|
|
|
|
|
|
|
|
||||||||
Store operating expenses
|
|
414,097
|
|
|
149,224
|
|
|
—
|
|
|
563,321
|
|
||||
Administrative expenses
|
|
—
|
|
|
—
|
|
|
120,042
|
|
|
120,042
|
|
||||
Depreciation and amortization
|
|
21,021
|
|
|
11,333
|
|
|
10,607
|
|
|
42,961
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
29,173
|
|
|
29,173
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
(2,444
|
)
|
|
(2,444
|
)
|
||||
Merger and other acquisition expenses
|
|
—
|
|
|
—
|
|
|
7,643
|
|
|
7,643
|
|
||||
Loss on foreign exchange
|
|
—
|
|
|
—
|
|
|
762
|
|
|
762
|
|
||||
Total expenses and other income
|
|
435,118
|
|
|
160,557
|
|
|
165,783
|
|
|
761,458
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income taxes
|
|
$
|
242,970
|
|
|
$
|
128,122
|
|
|
$
|
(165,783
|
)
|
|
$
|
205,309
|
|
|
|
As of December 31, 2018
|
||||||||||||||
|
|
U.S.
Operations |
|
Latin America
Operations |
|
Corporate
|
|
Consolidated
|
||||||||
Pawn loans
|
|
$
|
271,584
|
|
|
$
|
91,357
|
|
|
$
|
—
|
|
|
$
|
362,941
|
|
Consumer loans, net (1)
|
|
15,902
|
|
|
—
|
|
|
—
|
|
|
15,902
|
|
||||
Inventories
|
|
199,978
|
|
|
75,152
|
|
|
—
|
|
|
275,130
|
|
||||
Goodwill
|
|
759,538
|
|
|
157,881
|
|
|
—
|
|
|
917,419
|
|
||||
Total assets
|
|
1,534,542
|
|
|
407,282
|
|
|
166,150
|
|
|
2,107,974
|
|
(1)
|
Effective June 30, 2018, the Company no longer offers an unsecured consumer loan product in Latin America.
|
|
|
Year Ended December 31, 2017
|
||||||||||||||
|
|
U.S.
Operations
|
|
Latin America
Operations
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
||||||||
Retail merchandise sales
|
|
$
|
717,490
|
|
|
$
|
333,609
|
|
|
$
|
—
|
|
|
$
|
1,051,099
|
|
Pawn loan fees
|
|
380,596
|
|
|
130,309
|
|
|
—
|
|
|
510,905
|
|
||||
Wholesale scrap jewelry sales
|
|
119,197
|
|
|
21,645
|
|
|
—
|
|
|
140,842
|
|
||||
Consumer loan and credit services fees
|
|
75,209
|
|
|
1,767
|
|
|
—
|
|
|
76,976
|
|
||||
Total revenue
|
|
1,292,492
|
|
|
487,330
|
|
|
—
|
|
|
1,779,822
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Cost of revenue:
|
|
|
|
|
|
|
|
|
||||||||
Cost of retail merchandise sold
|
|
468,527
|
|
|
211,176
|
|
|
—
|
|
|
679,703
|
|
||||
Cost of wholesale scrap jewelry sold
|
|
112,467
|
|
|
20,327
|
|
|
—
|
|
|
132,794
|
|
||||
Consumer loan and credit services loss provision
|
|
19,431
|
|
|
388
|
|
|
—
|
|
|
19,819
|
|
||||
Total cost of revenue
|
|
600,425
|
|
|
231,891
|
|
|
—
|
|
|
832,316
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net revenue
|
|
692,067
|
|
|
255,439
|
|
|
—
|
|
|
947,506
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses and other income:
|
|
|
|
|
|
|
|
|
||||||||
Store operating expenses (1)
|
|
423,214
|
|
|
128,977
|
|
|
—
|
|
|
552,191
|
|
||||
Administrative expenses
|
|
—
|
|
|
—
|
|
|
122,473
|
|
|
122,473
|
|
||||
Depreciation and amortization
|
|
24,073
|
|
|
10,311
|
|
|
20,849
|
|
|
55,233
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
24,035
|
|
|
24,035
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
(1,597
|
)
|
|
(1,597
|
)
|
||||
Merger and other acquisition expenses
|
|
—
|
|
|
—
|
|
|
9,062
|
|
|
9,062
|
|
||||
Gain on foreign exchange (1)
|
|
—
|
|
|
—
|
|
|
(317
|
)
|
|
(317
|
)
|
||||
Loss on extinguishment of debt
|
|
—
|
|
|
—
|
|
|
14,114
|
|
|
14,114
|
|
||||
Total expenses and other income
|
|
447,287
|
|
|
139,288
|
|
|
188,619
|
|
|
775,194
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income taxes
|
|
$
|
244,780
|
|
|
$
|
116,151
|
|
|
$
|
(188,619
|
)
|
|
$
|
172,312
|
|
(1)
|
The gain on foreign exchange for the Latin America operations segment of $0.3 million for 2017 was reclassified on the consolidated statements of income in order to conform with the presentation for the year ended December 31, 2019. The gain on foreign exchange was reclassified from store operating expenses and reported separately on the consolidated statements of income.
|
|
|
As of December 31, 2017
|
||||||||||||||
|
|
U.S.
Operations |
|
Latin America
Operations |
|
Corporate
|
|
Consolidated
|
||||||||
Pawn loans
|
|
$
|
276,570
|
|
|
$
|
68,178
|
|
|
$
|
—
|
|
|
$
|
344,748
|
|
Consumer loans, net
|
|
23,179
|
|
|
343
|
|
|
—
|
|
|
23,522
|
|
||||
Inventories
|
|
216,739
|
|
|
60,032
|
|
|
—
|
|
|
276,771
|
|
||||
Goodwill
|
|
743,997
|
|
|
87,148
|
|
|
—
|
|
|
831,145
|
|
||||
Total assets
|
|
1,527,012
|
|
|
282,605
|
|
|
253,167
|
|
|
2,062,784
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenue:
|
|
|
|
|
|
|
||||||
U.S.
|
|
$
|
1,193,513
|
|
|
$
|
1,224,135
|
|
|
$
|
1,292,492
|
|
Mexico
|
|
641,505
|
|
|
531,744
|
|
|
464,161
|
|
|||
Other Latin America
|
|
29,421
|
|
|
24,979
|
|
|
23,169
|
|
|||
|
|
$
|
1,864,439
|
|
|
$
|
1,780,858
|
|
|
$
|
1,779,822
|
|
|
|
|
|
|
|
|
||||||
Long-lived assets:
|
|
|
|
|
|
|
||||||
U.S.
|
|
$
|
254,395
|
|
|
$
|
226,358
|
|
|
$
|
227,659
|
|
Mexico
|
|
80,385
|
|
|
65,260
|
|
|
53,175
|
|
|||
Other Latin America
|
|
12,893
|
|
|
9,265
|
|
|
3,552
|
|
|||
|
|
$
|
347,673
|
|
|
$
|
300,883
|
|
|
$
|
284,386
|
|
|
Quarter Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Total revenue
|
$
|
467,604
|
|
|
$
|
446,014
|
|
|
$
|
452,459
|
|
|
$
|
498,362
|
|
Total cost of revenue
|
211,805
|
|
|
201,709
|
|
|
201,480
|
|
|
231,098
|
|
||||
Net revenue
|
255,799
|
|
|
244,305
|
|
|
250,979
|
|
|
267,264
|
|
||||
Total expenses and other income
|
196,956
|
|
|
199,019
|
|
|
202,015
|
|
|
195,746
|
|
||||
Net income
|
42,655
|
|
|
33,048
|
|
|
34,761
|
|
|
54,154
|
|
||||
Diluted earnings per share
|
0.98
|
|
|
0.76
|
|
|
0.81
|
|
|
1.27
|
|
||||
Diluted weighted-average shares
|
43,658
|
|
|
43,256
|
|
|
43,167
|
|
|
42,760
|
|
||||
|
|
|
|
|
|
|
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Total revenue
|
$
|
449,800
|
|
|
$
|
419,972
|
|
|
$
|
429,878
|
|
|
$
|
481,208
|
|
Total cost of revenue
|
210,719
|
|
|
191,544
|
|
|
192,620
|
|
|
219,208
|
|
||||
Net revenue
|
239,081
|
|
|
228,428
|
|
|
237,258
|
|
|
262,000
|
|
||||
Total expenses and other income
|
183,302
|
|
|
186,157
|
|
|
193,175
|
|
|
198,824
|
|
||||
Net income
|
41,635
|
|
|
30,171
|
|
|
33,325
|
|
|
48,075
|
|
||||
Diluted earnings per share
|
0.90
|
|
|
0.67
|
|
|
0.76
|
|
|
1.09
|
|
||||
Diluted weighted-average shares
|
46,479
|
|
|
45,043
|
|
|
44,116
|
|
|
43,936
|
|
•
|
The division of our board of directors into three classes serving staggered terms of office of three years. With a classified board of directors, it would generally take a majority stockholder two annual meetings of stockholders to elect a majority of the board of directors. As a result, a classified board may discourage proxy contests for the election of directors or purchases of a substantial block of stock because it could operate to prevent obtaining control of the board in a relatively short period of time.
|
•
|
A prohibition of stockholder action by written consent of stockholders. Action by written consent may, in some circumstances, permit the taking of stockholders’ action opposed by the board of directors more rapidly than would be possible if a meeting of stockholders were required. The prohibition contained in the amended and restated certificate of incorporation will restrict the ability of controlling stockholders to take action at any time other than at an annual meeting and will generally force a takeover bidder to negotiate directly with the board of directors.
|
•
|
Permitting only the Company’s board of directors, a duly authorized committee of the board of directors, the chairman or the vice chairman of our board of directors or the chief executive officer to call a special meeting of the Company’s stockholders. This provision could prevent a stockholder from, among other things, calling a special meeting of stockholders to consider the stockholder’s proposed slate of directors or a transaction that might result in a change of control of the corporation.
|
•
|
An advance notice procedure with regard to stockholder nomination of candidates for election as directors and other business to be brought before an annual meeting of our stockholders. Although our amended and restated bylaws will not give our board of directors any power to approve or disapprove stockholder nominations for the election of directors or other proposals for action, these advance notice procedures may have the effect of precluding a contest for the election of directors or the consideration of other stockholder proposals if the established procedures are not followed and of discouraging or deterring a third party from conducting a solicitation of proxies to elect its own slate of directors or to approve another proposal without regard to whether consideration of those nominees or proposals might be harmful or beneficial to the Company and our stockholders.
|
•
|
Elimination, subject to certain exceptions, of the personal liability of directors of the Company for monetary damages for breaches of fiduciary duty by such directors. The amended and restated certificate of incorporation will not provide for the elimination of or any limitation on the personal liability of a director for (i) any breach of the director’s duty of loyalty to the Company or its stockholders, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) unlawful corporate distributions, or (iv) any transaction from which such director derives an improper personal benefit. This provision of the amended and restated certificate of incorporation will limit the remedies available to a stockholder who is dissatisfied with a decision of the board of directors protected by this provision, and such stockholder’s only remedy in that circumstance may be to bring a suit to prevent the action of the board. In many situations, this remedy may not be effective, as for example when stockholders are not aware of a transaction or an event prior to board action in respect of such transaction or event. In these cases, the stockholders and the corporation could be injured by the board’s decision and have no effective remedy.
|
•
|
Permitting the removal of directors only for cause by a vote of the holders of a majority of the outstanding shares of stock entitled to vote in an election of directors.
|
•
|
Permitting the board of directors, in evaluating any takeover offer, to consider all relevant factors, including the potential economic and social impact of the offer on our stockholders, employees, customers, creditors, the communities in which the Company operates and any other factors the directors consider pertinent. Once the board, in exercising its business judgment, has determined that a proposed action is not in the best interests of the Company, it has no duty to remove any barriers to the success of the action, including a shareholder rights plan.
|
(a)
|
Base Salary
|
(b)
|
Savings and Retirement Plans
|
(c)
|
Welfare Benefit Plans
|
(d)
|
Vacation
|
(e)
|
Expenses
|
(a)
|
Death
|
(b)
|
Disability
|
(c)
|
Termination by the Company
|
(d)
|
Termination by Feehan
|
(e)
|
Notice of Termination
|
(f)
|
Date of Termination
|
(a)
|
Termination by the Company Other Than for Cause or Disability; Termination by Feehan for Good Reason
|
(b)
|
Death or Disability
|
(c)
|
Termination by the Company for Cause; Feehan’s Resignation without Good Reason
|
(d)
|
Resignations
|
(a)
|
Acknowledgments
|
(b)
|
Definitions
|
(c)
|
Restrictions on Disclosure and Use of Confidential Information
|
(d)
|
Non-Competition
|
(e)
|
Non-Solicitation of Protected Customers
|
(f)
|
Non-Recruitment of Employees
|
(g)
|
Proprietary Rights
|
(h)
|
Return of Materials
|
(i)
|
Enforcement of Restrictive Covenants
|
(j)
|
Disclosure of Agreement
|
(a)
|
Governing Law; Forum Selection; Consent to Jurisdiction
|
(b)
|
Captions
|
(c)
|
Amendments
|
(d)
|
Notices
|
(e)
|
Severability
|
(f)
|
Withholding
|
(g)
|
Waivers
|
(h)
|
Entire Agreement
|
(i)
|
Construction
|
(j)
|
Counterparts
|
If to Feehan:
|
Daniel R. Feehan
|
If to the Company:
|
FirstCash, Inc.
|
__________________________________
|
|
||
Daniel R. Feehan
|
|||
|
|
|
|
|
|
|
|
FIRSTCASH, INC.
|
|||
|
|
||
By:_______________________________
|
|
||
Rick L. Wessel
|
|
||
Chief Executive Officer
|
|
Subsidiary Name
|
Country/State of Formation
|
Percentage
Owned
By Registrant
|
FirstCash, Inc.
|
Delaware
|
100%
|
First Cash, Inc.
|
Nevada
|
100%
|
Famous Pawn, Inc.
|
Maryland
|
100%
|
FCFS OK, Inc.
|
Oklahoma
|
100%
|
FCFS MO, Inc.
|
Missouri
|
100%
|
FCFS IN, Inc.
|
Indiana
|
100%
|
FCFS SC, Inc.
|
South Carolina
|
100%
|
FCFS NC, Inc.
|
North Carolina
|
100%
|
Frontier Merger Sub, LLC
|
Texas
|
100%
|
FCFS Corp.
|
Delaware
|
100%
|
First Cash Credit Management, LLC
|
Texas
|
100%
|
First Cash Credit, Ltd.
|
Texas
|
100%
|
Pawn TX, Inc.
|
Texas
|
100%
|
First Cash Management, LLC
|
Delaware
|
100%
|
LWC, LLC
|
Kentucky
|
100%
|
FCFS KY, Inc.
|
Kentucky
|
100%
|
LTS, Incorporated
|
Colorado
|
100%
|
Mister Money RM, Inc.
|
Colorado
|
100%
|
FCFS CO, Inc.
|
Colorado
|
100%
|
FC International, LLC
|
Delaware
|
100%
|
FCFS Global, B.V.
|
Netherlands
|
100%
|
First Cash, S.A. de C.V.
|
Mexico
|
100%
|
American Loan Employee Services, S.A. de C.V.
|
Mexico
|
100%
|
Maxi Prenda, S.A. de C.V.
|
Mexico
|
100%
|
Empenos Mexicanos, S.A. de C.V.
|
Mexico
|
100%
|
Soluciones Prima, S.A. de C.V.
|
Mexico
|
100%
|
Comercializadora Maxi, Sociedad Anonima
|
Guatemala
|
100%
|
Maxi Prenda Guatemala, Sociedad Anonima
|
Guatemala
|
100%
|
Soluciones Administrativas de Guatemala, Sociedad Anonima
|
Guatemala
|
100%
|
Soluciones Prima Guatemala, Sociedad Anonima
|
Guatemala
|
100%
|
Maxi Realice Guatemala S.A. de C.V.
|
Guatemala
|
100%
|
First Cash SV, Limitada de C.V.
|
El Salvador
|
100%
|
First Cash Colombia, LTDA
|
Colombia
|
100%
|
Maxi Prenda Honduras, S.A. de C.V.
|
Honduras
|
100%
|
Subsidiary Name
|
Country/State of Formation
|
Percentage
Owned
By Registrant
|
Cash America Central, Inc.
|
Tennessee
|
100%
|
Cash America East, Inc.
|
Florida
|
100%
|
Cash America Financial Services, Inc.
|
Delaware
|
100%
|
Cash America Holding, Inc.
|
Delaware
|
100%
|
Cash America Management L.P.
|
Delaware
|
100%
|
Cash America of Mexico, Inc.
|
Delaware
|
100%
|
Cash America Pawn L.P.
|
Delaware
|
100%
|
Cash America West, Inc.
|
Nevada
|
100%
|
Cash America, Inc.
|
Delaware
|
100%
|
Cash America Advance, Inc.
|
Delaware
|
100%
|
Cash America, Inc. of Alaska
|
Alaska
|
100%
|
Cash America, Inc. of Illinois
|
Illinois
|
100%
|
Cash America, Inc. of Louisiana
|
Delaware
|
100%
|
Cash America, Inc. of North Carolina
|
North Carolina
|
100%
|
Cash America, Inc. of Oklahoma
|
Oklahoma
|
100%
|
Cash America Internet Sales, Inc.
|
Delaware
|
100%
|
Cash America of Missouri, Inc.
|
Missouri
|
100%
|
Cashland Financial Services, Inc.
|
Delaware
|
100%
|
Creazione Estilo, S.A. de C.V., a sociedad anónima de capital variable (in liquidation)
|
Mexico
|
100%
|
CSH Holdings LLC
|
Delaware
|
100%
|
Georgia Cash America, Inc.
|
Georgia
|
100%
|
Mr. Payroll Corporation
|
Delaware
|
100%
|
Ohio Neighborhood Finance, Inc.
|
Delaware
|
100%
|
Ohio Neighborhood Credit Solutions, LLC
|
Delaware
|
100%
|
1.
|
I have reviewed this Annual Report on Form 10-K of FirstCash, Inc. (the “Registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
|
4.
|
The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
|
5.
|
The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.
|
1.
|
I have reviewed this Annual Report on Form 10-K of FirstCash, Inc. (the “Registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
|
4.
|
The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
|
5.
|
The Registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Act of 1934, as amended; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Act of 1934, as amended; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|