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þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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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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74-2540145
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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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2500 Bee Cave Road, Bldg One, Suite 200, Rollingwood, Texas
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78746
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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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Name of Each Exchange on Which Registered
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Class A Non-voting Common Stock, $.01 par value per share
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The NASDAQ Stock Market
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(NASDAQ Global Select Market)
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Large accelerated filer
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o
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Accelerated filer
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þ
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Non-accelerated filer
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o
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Smaller reporting company
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o
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Emerging growth company
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o
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Item
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Page
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No.
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No.
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•
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Market Leading Customer Satisfaction;
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•
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Exceptional Staff Engagement;
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•
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Most Efficient Provider of Cash; and
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•
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Attractive Shareholder Returns.
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•
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508
United States pawn stores (operating primarily as EZPAWN or Value Pawn & Jewelry);
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•
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340
Mexico pawn stores (operating primarily as Empeño Fácil);
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•
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113
pawn stores in Guatemala, El Salvador, Honduras and Peru (operating as GuatePrenda and MaxiEfectivo); and
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•
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27
financial services stores in Canada (operating as CASHMAX).
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•
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“U.S. Pawn” — Includes our EZPAWN, Value Pawn & Jewelry and other branded pawn operations in the United States;
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•
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“Latin America Pawn” — Includes our Empeño Fácil and other branded pawn operations in Mexico, as well as our GuatePrenda and MaxiEfectivo pawn operations in Guatemala, El Salvador, Honduras and Peru; and
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•
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“Other International” — Includes primarily our CASHMAX financial services operations in Canada and our equity interest in the net income of Cash Converters International.
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U.S. Pawn
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Latin America Pawn
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Other International
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Consolidated
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||||
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||||
As of September 30, 2015
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522
|
|
|
237
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|
|
27
|
|
|
786
|
|
New locations opened
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—
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|
|
3
|
|
|
—
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|
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3
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|
Locations acquired
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6
|
|
|
—
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|
|
—
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|
|
6
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Locations sold, combined or closed
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(8
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)
|
|
(1
|
)
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—
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|
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(9
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)
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As of September 30, 2016
|
520
|
|
|
239
|
|
|
27
|
|
|
786
|
|
New locations opened
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—
|
|
|
10
|
|
|
—
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|
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10
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Locations acquired
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2
|
|
|
—
|
|
|
—
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|
|
2
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Locations sold, combined or closed
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(9
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)
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|
(3
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)
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|
—
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|
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(12
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)
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As of September 30, 2017
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513
|
|
|
246
|
|
|
27
|
|
|
786
|
|
New locations opened
|
—
|
|
|
12
|
|
|
—
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|
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12
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Locations acquired
|
—
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|
|
196
|
|
|
—
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|
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196
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|
Locations sold, combined or closed
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(5
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)
|
|
(1
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)
|
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—
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|
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(6
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)
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As of September 30, 2018
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508
|
|
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453
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27
|
|
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988
|
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•
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In October 2017, we acquired 112 GuatePrenda-MaxiEfectivo (“GPMX”) pawn stores in Guatemala (72 stores), El Salvador (17 stores), Honduras (12 stores) and Peru (11 stores). This was our largest acquisition to date in terms of store count, and it significantly expanded our store base into Latin American countries outside of Mexico.
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•
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In December 2017, we acquired 21 pawn stores in the Mexican state of Sinaloa operating under the name “Bazareño.” The Bazareño stores make up the largest chain of pawn stores in Culiacan, the capital city of Sinaloa, giving us the number one position in that market and an important strategic presence in the northwest region of Mexico.
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•
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In June 2018, we acquired an additional 23 pawn stores in Mexico operating under the name “Presta Dinero.” These stores expand our presence into a number of cities within seven central-Mexico states in which we already had stores, allowing us to achieve synergies in management and administration while giving us a presence in new cities and neighborhoods within those states.
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•
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Also in June 2018, we acquired 40 pawn stores operating under the name “Montepio San Patricio” in and around Mexico City. This was our largest acquisition in Mexico to date and significantly strengthens our competitive position in the strategically important Mexico City metropolitan area.
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•
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During the year, we opened 12 de novo stores in Latin America (11 in Mexico and one in Guatemala) and closed one store.
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•
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We are subject to the federal Gramm-Leach-Bliley Act and its underlying regulations, as well as various state laws and regulations relating to privacy and data security. Under these regulations, we are required to disclose to our customers our policies and practices relating to the protection and sharing of customers’ nonpublic personal information. These
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•
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Under the USA PATRIOT Act, we must maintain an anti-money laundering compliance program that includes the development of internal policies, procedures and controls; the designation of a compliance officer; an ongoing team member training program; and an independent audit function to test the program.
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•
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We are subject to the Bank Secrecy Act and its underlying regulations, which require us to report and maintain records of certain high-dollar transactions. In addition, federal laws and regulations prohibit us from doing business with terrorists and require us to report certain suspicious transactions to the Financial Crimes Enforcement Network of the Treasury Department (“FinCen”). Generally, a transaction is considered to be suspicious if we know, suspect or have reason to suspect that the transaction (a) involves funds derived from illegal activity or is intended to hide or disguise such funds, (b) is designed to evade the requirements of the Bank Secrecy Act or (c) appears to serve no legitimate business or lawful purpose.
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•
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The Foreign Corrupt Practices Act ("FCPA") was enacted for the purpose of making it unlawful for certain classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business. Specifically, the anti-bribery provisions of the FCPA prohibit the willful use of mail or any means of instrumentality of interstate commerce corruptly in furtherance of any offer, payment, promise to pay, or authorization of the payment of money or anything of value to any person, while knowing that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to a foreign official to influence the foreign official in his or her official capacity, induce the foreign official to do or omit to do an act in violation of his or her lawful duty, or to secure any improper advantage in order to assist in obtaining or retaining business for or with, or directing business to, any person.
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•
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Effective October 2016, Department of Defense regulations promulgated under the Military Lending Act (the “MLA”), formerly applicable to payday loans and auto title loans, were expanded to include various additional forms of consumer credit, including pawn loans. The MLA regulations limit the annual percentage rate charged on consumer loans made to active military personnel or their dependents to 36%.
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United States:
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Texas
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217
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Florida
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96
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Colorado
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34
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Illinois
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21
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Oklahoma
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21
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Arizona
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20
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Nevada
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17
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Indiana
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15
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Tennessee
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13
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Iowa
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11
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Utah
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9
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Georgia
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8
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Minnesota
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7
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Alabama
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5
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Oregon
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5
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Wisconsin
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3
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Virginia
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2
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Pennsylvania
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2
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Mississippi
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1
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Arkansas
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1
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Total United States locations
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508
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Mexico:
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Estado de M
é
xico
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70
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Distrito Federal
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59
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Veracruz
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36
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Sinaloa
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22
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Fiscal Year Ended September 30,
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||||||||||||||||||
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2018
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2017
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2016
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2015
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2014
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||||||||||
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||||||||||
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(in thousands, except per share and store figures)
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||||||||||||||||||
Operating data:
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||||||||||
Total revenues
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$
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813,515
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$
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747,954
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$
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730,505
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$
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720,000
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|
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$
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745,770
|
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Net revenues
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482,910
|
|
|
435,510
|
|
|
428,230
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|
|
403,020
|
|
|
421,857
|
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|||||
Restructuring
|
—
|
|
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—
|
|
|
1,921
|
|
|
17,080
|
|
|
6,664
|
|
|||||
Impairment of investments
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11,712
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|
|
—
|
|
|
10,957
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|
|
26,837
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|
|
7,940
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|
|||||
Income (loss) from continuing operations, net of tax
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38,927
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|
|
32,033
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(8,998
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)
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|
(52,182
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)
|
|
3,438
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|||||
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|||||||||
Basic earnings (loss) per share attributable to EZCORP, Inc. — continuing operations
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$
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0.73
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$
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0.62
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|
|
$
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(0.15
|
)
|
|
$
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(0.94
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)
|
|
$
|
0.08
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Diluted earnings (loss) per share attributable to EZCORP, Inc. — continuing operations
|
$
|
0.69
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|
|
$
|
0.62
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|
|
$
|
(0.15
|
)
|
|
$
|
(0.94
|
)
|
|
$
|
0.08
|
|
|
|
|
|
|
|
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|||||||||
Weighted average shares outstanding:
|
|
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|||||||||
Basic
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54,456
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|
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54,260
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|
|
54,427
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|
|
54,369
|
|
|
54,148
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|
|||||
Diluted
|
57,896
|
|
|
54,368
|
|
|
54,427
|
|
|
54,369
|
|
|
54,292
|
|
|||||
|
|
|
|
|
|
|
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|
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|
|||||||||
Stores attributable to continuing operations at end of period
|
988
|
|
|
786
|
|
|
786
|
|
|
786
|
|
|
804
|
|
|
September 30,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
|
|
|
|
|
|
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|
||||||||||
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(in thousands)
|
||||||||||||||||||
Balance sheet data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Pawn loans
|
$
|
198,463
|
|
|
$
|
169,242
|
|
|
$
|
167,329
|
|
|
$
|
159,964
|
|
|
$
|
162,444
|
|
Inventory, net
|
166,997
|
|
|
154,411
|
|
|
140,224
|
|
|
124,084
|
|
|
138,175
|
|
|||||
Working capital (a) (b)
|
497,341
|
|
|
508,382
|
|
|
387,165
|
|
|
318,107
|
|
|
370,247
|
|
|||||
Total assets (a)
|
1,246,920
|
|
|
1,024,363
|
|
|
983,244
|
|
|
898,908
|
|
|
1,023,982
|
|
|||||
Long-term debt, less current maturities (a)
|
226,702
|
|
|
284,807
|
|
|
283,611
|
|
|
197,976
|
|
|
213,265
|
|
|||||
EZCORP, Inc. stockholders’ equity
|
748,037
|
|
|
662,375
|
|
|
594,983
|
|
|
656,031
|
|
|
812,346
|
|
(a)
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Amounts exclude assets and liabilities held for sale in conjunction with the disposal of Grupo Finmart as discussed in
Note 16
of Notes to Consolidated Financial Statements included in “Part II, Item 8 — Financial Statements and Supplemental Data.”
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(b)
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Fiscal 2018 amount is inclusive of
$190.2 million
in current maturities of long-term debt, net.
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•
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Basic earnings per share from continuing operations grew $0.11 in fiscal 2018 to $0.73, and fully diluted earnings per share increased
$0.07
to
$0.69
for the year. Net income from continuing operations grew
$6.9 million
to
$38.9 million
.
|
•
|
We continue to lead the market in same store growth in Pawn Loans Outstanding “PLO.”
|
•
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PLO more than doubled in our Latin America Pawn segment primarily as a result of the acquisition of 112 pawn stores in Guatemala, El Salvador, Honduras and Peru in October 2017 and another 84 stores in Mexico in December 2017 and June 2018, providing immediate accretion to earnings and a platform for further growth and expansion in Latin America.
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•
|
Operating contribution from the Latin America Pawn segment improved significantly to
$34.3 million
, up
84%
, and comprising 27% of our total consolidated segment contribution.
|
•
|
We ended the year with a cash balance of
$286.0 million
, a
74%
increase.
|
•
|
We successfully completed a $172.5 million offering of convertible notes with a coupon rate of 2.375% and a seven-year term, improving liquidity and providing capital for potential future acquisitions or debt repayment.
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|
Fiscal Year Ended September 30,
|
|
Change
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||||||
|
2018
|
|
2017
|
|
|||||
|
|
|
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|
|
||||
|
(in thousands)
|
|
|
||||||
Net revenues:
|
|
|
|
|
|
||||
Pawn service charges
|
$
|
305,936
|
|
|
$
|
273,080
|
|
|
12%
|
|
|
|
|
|
|
||||
Merchandise sales
|
438,372
|
|
|
414,838
|
|
|
6%
|
||
Merchandise sales gross profit
|
161,754
|
|
|
148,313
|
|
|
9%
|
||
Gross margin on merchandise sales
|
37
|
%
|
|
36
|
%
|
|
100 bps
|
||
|
|
|
|
|
|
||||
Jewelry scrapping sales
|
60,752
|
|
|
51,189
|
|
|
19%
|
||
Jewelry scrapping gross profit
|
8,462
|
|
|
7,258
|
|
|
17%
|
||
Gross margin on jewelry scrapping sales
|
14
|
%
|
|
14
|
%
|
|
—
|
||
|
|
|
|
|
|
||||
Other revenues, net
|
6,758
|
|
|
6,859
|
|
|
(1)%
|
||
Net revenues
|
482,910
|
|
|
435,510
|
|
|
11%
|
||
|
|
|
|
|
|
||||
Operating expenses
|
414,249
|
|
|
381,910
|
|
|
8%
|
||
Non-operating expenses
|
11,585
|
|
|
10,361
|
|
|
12%
|
||
Income from continuing operations before income taxes
|
57,076
|
|
|
43,239
|
|
|
32%
|
||
Income tax expense
|
18,149
|
|
|
11,206
|
|
|
62%
|
||
Income from continuing operations, net of tax
|
38,927
|
|
|
32,033
|
|
|
22%
|
||
Loss from discontinued operations, net of tax
|
(856
|
)
|
|
(1,825
|
)
|
|
(53)%
|
||
Net income
|
38,071
|
|
|
30,208
|
|
|
26%
|
||
Net loss attributable to noncontrolling interest
|
(988
|
)
|
|
(1,650
|
)
|
|
(40)%
|
||
Net income attributable to EZCORP, Inc.
|
$
|
39,059
|
|
|
$
|
31,858
|
|
|
23%
|
|
|
|
|
|
|
||||
Net pawn earning assets:
|
|
|
|
|
|
||||
Pawn loans
|
$
|
198,463
|
|
|
$
|
169,242
|
|
|
17%
|
Inventory, net
|
166,997
|
|
|
154,411
|
|
|
8%
|
||
Total net pawn earning assets
|
$
|
365,460
|
|
|
$
|
323,653
|
|
|
13%
|
•
|
Impairment of our investment in Cash Converters International Limited (“Cash Converters International”) in the amount of
$11.7 million
(
$9.2 million
, net of taxes); partially offset by
|
•
|
A
$4.9 million
increase in interest income on our notes receivable from the sale of Prestaciones Finmart, S.A.P.I. de C.V., SOFOM, E.N.R. ("Grupo Finmart"), in addition to ordinary accruals of interest and accretion of associated debt discounts; and
|
•
|
A
$5.0 million
increase in other income primarily due to net recoveries from a legal settlement.
|
|
Fiscal Year Ended September 30,
|
|
Change
|
||||||
|
2018
|
|
2017
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Net revenues:
|
|
|
|
|
|
||||
Pawn service charges
|
$
|
237,461
|
|
|
$
|
238,437
|
|
|
—%
|
|
|
|
|
|
|
||||
Merchandise sales
|
350,699
|
|
|
351,878
|
|
|
—%
|
||
Merchandise sales gross profit
|
134,291
|
|
|
128,403
|
|
|
5%
|
||
Gross margin on merchandise sales
|
38
|
%
|
|
36
|
%
|
|
200 bps
|
||
|
|
|
|
|
|
||||
Jewelry scrapping sales
|
47,745
|
|
|
48,203
|
|
|
(1)%
|
||
Jewelry scrapping sales gross profit
|
7,328
|
|
|
6,769
|
|
|
8%
|
||
Gross margin on jewelry scrapping sales
|
15
|
%
|
|
14
|
%
|
|
100 bps
|
||
|
|
|
|
|
|
||||
Other revenues
|
250
|
|
|
219
|
|
|
14%
|
||
Net revenues
|
379,330
|
|
|
373,828
|
|
|
1%
|
||
|
|
|
|
|
|
||||
Segment operating expenses:
|
|
|
|
|
|
||||
Operations
|
263,094
|
|
|
259,977
|
|
|
1%
|
||
Depreciation and amortization
|
12,869
|
|
|
10,171
|
|
|
27%
|
||
Segment operating contribution
|
103,367
|
|
|
103,680
|
|
|
—%
|
||
|
|
|
|
|
|
||||
Other segment expenses
|
271
|
|
|
179
|
|
|
51%
|
||
Segment contribution
|
$
|
103,096
|
|
|
$
|
103,501
|
|
|
—%
|
|
|
|
|
|
|
||||
Other data:
|
|
|
|
|
|
||||
Net earning assets — continuing operations (a)
|
$
|
290,140
|
|
|
$
|
280,673
|
|
|
3%
|
Inventory turnover
|
1.9
|
|
|
2.1
|
|
|
(0.2)x
|
||
Average monthly ending pawn loan balance per store (b)
|
$
|
279
|
|
|
$
|
280
|
|
|
—%
|
Monthly average yield on pawn loans outstanding
|
14
|
%
|
|
14
|
%
|
|
—
|
||
Pawn loan redemption rate
|
84
|
%
|
|
84
|
%
|
|
—
|
(a)
|
Balance includes pawn loans and inventory.
|
(b)
|
Balance is calculated based on the average of the monthly ending balance averages during the applicable period.
|
|
Change in Net Revenue
|
||||||||||
|
Pawn Service Charges
|
|
Merchandise Sales Gross Profit
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Same stores
|
$
|
(0.3
|
)
|
|
$
|
6.4
|
|
|
$
|
6.1
|
|
Closed stores and other
|
(0.7
|
)
|
|
(0.5
|
)
|
|
(1.2
|
)
|
|||
Total
|
$
|
(1.0
|
)
|
|
$
|
5.9
|
|
|
$
|
4.9
|
|
Change in jewelry scrapping sales gross profit and other revenues
|
|
|
|
|
0.6
|
|
|||||
Total change in net revenue
|
|
|
|
|
$
|
5.5
|
|
|
Fiscal Year Ended September 30,
|
||||||||||||||
|
2018 (GAAP)
|
|
2017 (GAAP)
|
|
Change (GAAP)
|
|
2018 (Constant Currency)
|
|
Change (Constant Currency)
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
||||||
Pawn service charges
|
$
|
68,475
|
|
|
$
|
34,643
|
|
|
98%
|
|
$
|
68,631
|
|
|
98%
|
|
|
|
|
|
|
|
|
|
|
||||||
Merchandise sales
|
87,673
|
|
|
62,957
|
|
|
39%
|
|
87,485
|
|
|
39%
|
|||
Merchandise sales gross profit
|
27,463
|
|
|
19,907
|
|
|
38%
|
|
27,382
|
|
|
38%
|
|||
Gross margin on merchandise sales
|
31
|
%
|
|
32
|
%
|
|
(100) bps
|
|
31
|
%
|
|
(100) bps
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Jewelry scrapping sales
|
13,007
|
|
|
2,986
|
|
|
336%
|
|
13,011
|
|
|
336%
|
|||
Jewelry scrapping sales gross profit
|
1,134
|
|
|
489
|
|
|
132%
|
|
1,133
|
|
|
132%
|
|||
Gross margin on jewelry scrapping sales
|
9
|
%
|
|
16
|
%
|
|
(700) bps
|
|
9
|
%
|
|
(700) bps
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Other revenues
|
85
|
|
|
645
|
|
|
(87)%
|
|
41
|
|
|
(94)%
|
|||
Net revenues
|
97,157
|
|
|
55,684
|
|
|
74%
|
|
97,187
|
|
|
75%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Segment operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||
Operations
|
61,361
|
|
|
36,211
|
|
|
69%
|
|
61,297
|
|
|
69%
|
|||
Depreciation and amortization
|
4,068
|
|
|
2,675
|
|
|
52%
|
|
4,086
|
|
|
53%
|
|||
Segment operating contribution
|
31,728
|
|
|
16,798
|
|
|
89%
|
|
31,804
|
|
|
89%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Other segment income (a)
|
(2,609
|
)
|
|
(1,856
|
)
|
|
41%
|
|
(2,400
|
)
|
|
(a)
|
|||
Segment contribution
|
$
|
34,337
|
|
|
$
|
18,654
|
|
|
84%
|
|
$
|
34,204
|
|
|
83%
|
|
|
|
|
|
|
|
|
|
|
||||||
Other data:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net earning assets — continuing operations (b)
|
$
|
75,320
|
|
|
$
|
42,952
|
|
|
75%
|
|
$
|
76,804
|
|
|
79%
|
Inventory turnover
|
2.7
|
|
|
2.4
|
|
|
0.3x
|
|
2.7
|
|
|
0.3x
|
|||
Average monthly ending pawn loan balance per store (c)
|
$
|
90
|
|
|
$
|
74
|
|
|
22%
|
|
$
|
91
|
|
|
23%
|
Monthly average yield on pawn loans outstanding
|
16
|
%
|
|
16
|
%
|
|
—
|
|
17
|
%
|
|
100 bps
|
|||
Pawn loan redemption rate
|
79
|
%
|
|
78
|
%
|
|
100 bps
|
|
79
|
%
|
|
100 bps
|
(a)
|
Fiscal 2018 constant currency amount excludes $0.2 million of net GAAP basis foreign currency transaction gains resulting from movement in exchange rates. The net foreign currency transaction gains for fiscal 2017 were $0.1 million and are included in the above results.
|
|||
(b)
|
Balance includes pawn loans and inventory.
|
|||
(c)
|
Balance is calculated based on the average of the monthly ending balance averages during the applicable period.
|
|
Change in Net Revenue (GAAP)
|
||||||||||
|
Pawn Service Charges
|
|
Merchandise Sales Gross Profit
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Same stores
|
$
|
3.7
|
|
|
$
|
1.8
|
|
|
$
|
5.5
|
|
New stores and other
|
30.1
|
|
|
5.8
|
|
|
35.9
|
|
|||
Total
|
$
|
33.8
|
|
|
$
|
7.6
|
|
|
$
|
41.4
|
|
Change in jewelry scrapping sales gross profit and other revenues
|
|
|
|
|
0.1
|
|
|||||
Total change in net revenue
|
|
|
|
|
$
|
41.5
|
|
|
Change in Net Revenue (Constant Currency)
|
||||||||||
|
Pawn Service Charges
|
|
Merchandise Sales Gross Profit
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Same stores
|
$
|
4.3
|
|
|
$
|
1.7
|
|
|
$
|
6.0
|
|
New stores and other
|
29.7
|
|
|
5.8
|
|
|
35.5
|
|
|||
Total
|
$
|
34.0
|
|
|
$
|
7.5
|
|
|
$
|
41.5
|
|
Change in jewelry scrapping sales gross profit and other revenues
|
|
|
|
|
—
|
|
|||||
Total change in net revenue
|
|
|
|
|
$
|
41.5
|
|
|
Fiscal Year Ended September 30,
|
|
Percentage Change
|
||||||
|
2018
|
|
2017
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Net revenues:
|
|
|
|
|
|
||||
Consumer loan fees and interest
|
$
|
8,120
|
|
|
$
|
7,983
|
|
|
2%
|
Consumer loan bad debt
|
(1,697
|
)
|
|
(1,988
|
)
|
|
(15)%
|
||
Other revenues, net
|
—
|
|
|
3
|
|
|
(100)%
|
||
Net revenues
|
6,423
|
|
|
5,998
|
|
|
7%
|
||
|
|
|
|
|
|
||||
Segment operating (income) expenses:
|
|
|
|
|
|
||||
Operating expenses
|
10,378
|
|
|
8,639
|
|
|
20%
|
||
Equity in net income of unconsolidated affiliate
|
(5,529
|
)
|
|
(4,916
|
)
|
|
12%
|
||
Segment operating income
|
1,574
|
|
|
2,275
|
|
|
(31)%
|
||
|
|
|
|
|
|
||||
Impairment of investment
|
11,712
|
|
|
—
|
|
|
*
|
||
Other segment income
|
(132
|
)
|
|
(96
|
)
|
|
38%
|
||
Segment (loss) contribution
|
$
|
(10,006
|
)
|
|
$
|
2,371
|
|
|
*
|
*
|
Represents a percentage computation that is not mathematically meaningful.
|
•
|
Impairment of our investment in Cash Converters International in the amount of
$11.7 million
(
$9.2 million
, net of taxes) related to shares acquired prior to fiscal 2018; and
|
•
|
A $1.7 million increase in operating expenses, including further investment in the development of technology to drive future revenue enhancement.
|
|
Fiscal Year Ended September 30,
|
|
Percentage Change
|
||||||
|
2018
|
|
2017
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Segment contribution
|
$
|
127,427
|
|
|
$
|
124,526
|
|
|
2%
|
Corporate expenses (income):
|
|
|
|
|
|
||||
Administrative
|
53,653
|
|
|
53,254
|
|
|
1%
|
||
Depreciation and amortization
|
8,363
|
|
|
10,624
|
|
|
(21)%
|
||
Loss on sale or disposal of assets
|
233
|
|
|
27
|
|
|
763%
|
||
Interest expense
|
27,738
|
|
|
27,794
|
|
|
—%
|
||
Interest income
|
(14,422
|
)
|
|
(10,173
|
)
|
|
42%
|
||
Other income
|
(5,214
|
)
|
|
(239
|
)
|
|
2,082%
|
||
Income from continuing operations before income taxes
|
57,076
|
|
|
43,239
|
|
|
32%
|
||
Income tax expense
|
18,149
|
|
|
11,206
|
|
|
62%
|
||
Income from continuing operations, net of tax
|
38,927
|
|
|
32,033
|
|
|
22%
|
||
Loss from discontinued operations, net of tax
|
(856
|
)
|
|
(1,825
|
)
|
|
(53)%
|
||
Net income
|
38,071
|
|
|
30,208
|
|
|
26%
|
||
Net loss attributable to noncontrolling interest
|
(988
|
)
|
|
(1,650
|
)
|
|
(40)%
|
||
Net income attributable to EZCORP, Inc.
|
$
|
39,059
|
|
|
$
|
31,858
|
|
|
23%
|
•
|
The May 2018 issuance of $172.5 million aggregate principal amount of 2.375% Senior Convertible Notes Due 2025, including accruals of interest and amortization of associated discounts and deferred financings costs;
|
•
|
Extinguishment of debt and other costs of $5.3 million in fiscal 2017 as a result of retiring $35 million principal amount of our 2.125% Senior Cash Convertible Notes Due 2019 and the entirety of our $100 million Term Loan Facility in July 2017; and
|
•
|
The July 2017 issuance of $143.8 million aggregate principal amount of 2.875% Senior Convertible Notes Due 2024, including accruals of interest and amortization of associated discounts and deferred financings costs.
|
|
Fiscal Year Ended September 30,
|
|
Change
|
||||||
|
2017
|
|
2016
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Net revenues:
|
|
|
|
|
|
||||
Pawn service charges
|
$
|
273,080
|
|
|
$
|
261,800
|
|
|
4%
|
|
|
|
|
|
|
||||
Merchandise sales
|
414,838
|
|
|
409,107
|
|
|
1%
|
||
Merchandise sales gross profit
|
148,313
|
|
|
150,836
|
|
|
(2)%
|
||
Gross margin on merchandise sales
|
36
|
%
|
|
37
|
%
|
|
(100) bps
|
||
|
|
|
|
|
|
||||
Jewelry scrapping sales
|
51,189
|
|
|
50,113
|
|
|
2%
|
||
Jewelry scrapping sales gross profit
|
7,258
|
|
|
8,074
|
|
|
(10)%
|
||
Gross margin on jewelry scrapping sales
|
14
|
%
|
|
16
|
%
|
|
(200) bps
|
||
|
|
|
|
|
|
||||
Other revenues, net
|
6,859
|
|
|
7,520
|
|
|
(9)%
|
||
Net revenues
|
435,510
|
|
|
428,230
|
|
|
2%
|
||
|
|
|
|
|
|
||||
Operating expenses
|
381,910
|
|
|
399,057
|
|
|
(4)%
|
||
Non-operating expenses
|
10,361
|
|
|
28,810
|
|
|
(64)%
|
||
Income from continuing operations before income taxes
|
43,239
|
|
|
363
|
|
|
11,812%
|
||
Income tax expense
|
11,206
|
|
|
9,361
|
|
|
20%
|
||
Income (loss) from continuing operations, net of tax
|
32,033
|
|
|
(8,998
|
)
|
|
*
|
||
Loss from discontinued operations, net of tax
|
(1,825
|
)
|
|
(79,432
|
)
|
|
(98)%
|
||
Net income (loss)
|
30,208
|
|
|
(88,430
|
)
|
|
*
|
||
Net loss attributable to noncontrolling interest
|
(1,650
|
)
|
|
(7,686
|
)
|
|
(79)%
|
||
Net income (loss) attributable to EZCORP, Inc.
|
$
|
31,858
|
|
|
$
|
(80,744
|
)
|
|
*
|
|
|
|
|
|
|
||||
Net pawn earning assets:
|
|
|
|
|
|
||||
Pawn loans
|
$
|
169,242
|
|
|
$
|
167,329
|
|
|
1%
|
Inventory, net
|
154,411
|
|
|
140,224
|
|
|
10%
|
||
Total net pawn earning assets
|
$
|
323,653
|
|
|
$
|
307,553
|
|
|
5%
|
*
|
Represents a percentage computation that is not mathematically meaningful.
|
|
U.S. Pawn
|
|
Mexico Pawn
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions, except per share data)
|
||||||||||
Pawn service charges
|
$
|
(1.6
|
)
|
|
$
|
—
|
|
|
$
|
(1.6
|
)
|
Merchandise sales gross profit
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|||
Operating expenses and loss on disposal of assets
|
1.0
|
|
|
0.1
|
|
|
1.1
|
|
|||
Income from continuing operations before income taxes
|
$
|
(2.8
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
(2.9
|
)
|
|
|
|
|
|
|
||||||
Diluted loss per share attributable to EZCORP, Inc. — continuing operations
|
$
|
(0.03
|
)
|
|
$
|
—
|
|
|
$
|
(0.03
|
)
|
|
|
|
|
|
|
||||||
Pawn loans outstanding as of September 30, 2017
|
$
|
(5.0
|
)
|
|
$
|
—
|
|
|
$
|
(5.0
|
)
|
•
|
A
$14.8 million
decrease in administrative expense due primarily to a $7.9 million decrease in business and professional fees as a result of the completion of internal control remediation efforts in fiscal 2016, inclusive of $0.8 million in acquisition-related costs, and a $7.0 million decrease in labor costs including the impact of corporate headcount reductions, partially offset by $1.2 million in costs related to our acquisition of GPMX in October 2017;
|
•
|
A
$2.9 million
decrease in depreciation and amortization expense from a lower depreciable asset base;
|
•
|
A
$1.9 million
decrease in restructuring expense as our prior actions are complete; and
|
•
|
A
$0.7 million
decrease in loss on sale or disposal of assets due to a reduction in asset disposals in fiscal 2017; partially offset by
|
•
|
A
$3.2 million
increase in operations expense primarily due to investment in field leadership and customer-facing team members in addition to higher team member benefit costs, $0.9 million in costs (exclusive of $0.1 million in non-operating expenses) attributable to Hurricane Harvey in Texas during our fourth quarter of fiscal 2017 and $0.6 million in losses, net of insurance recoveries, associated with riot-related looting of 12 stores in Mexico during our second fiscal quarter.
|
•
|
A
$5.2 million
increase in income from our unconsolidated affiliate due to improvement in performance of Cash Converters International as a result of improved operations and the completion of fiscal 2016 restructuring actions;
|
•
|
No impairments of our investment in Cash Converters International in fiscal 2017, compared to an $11.0 million impairment ($7.2 million, net of taxes) in fiscal 2016;
|
•
|
A
$12.0 million
increase in interest income as a result of our notes receivable from the sale of Grupo Finmart including a $3.0 million gain as a result of the restructuring of the notes receivable in September 2017, in addition to ordinary accruals of interest and accretion of associated discounts; and
|
•
|
A
$1.6 million
decrease in other expense primarily due to net foreign currency transaction losses in fiscal 2016 as a result of movement in exchange rates; partially offset by
|
•
|
An
$11.3 million
increase in interest expense primarily as a result of our Term Loan Facility obtained in September 2016, including accruals of interest in addition to amortization of associated discounts and deferred financings costs. We incurred loss on extinguishment of debt and other costs of $5.3 million, recorded as a component of interest expense, as a result of the retirement of $35 million principal amount of 2019 Convertible Notes and the Term Loan Facility in July 2017, funded by proceeds from our offering of 2024 Convertible Notes.
|
|
Fiscal Year Ended September 30,
|
|
Change
|
||||||
|
2017
|
|
2016
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Net revenues:
|
|
|
|
|
|
||||
Pawn service charges
|
$
|
238,437
|
|
|
$
|
229,893
|
|
|
4%
|
|
|
|
|
|
|
||||
Merchandise sales
|
351,878
|
|
|
348,771
|
|
|
1%
|
||
Merchandise sales gross profit
|
128,403
|
|
|
131,503
|
|
|
(2)%
|
||
Gross margin on merchandise sales
|
36
|
%
|
|
38
|
%
|
|
(200) bps
|
||
|
|
|
|
|
|
||||
Jewelry scrapping sales
|
48,203
|
|
|
47,810
|
|
|
1%
|
||
Jewelry scrapping sales gross profit
|
6,769
|
|
|
7,672
|
|
|
(12)%
|
||
Gross margin on jewelry scrapping sales
|
14
|
%
|
|
16
|
%
|
|
(200) bps
|
||
|
|
|
|
|
|
||||
Other revenues, net
|
219
|
|
|
331
|
|
|
(34)%
|
||
Net revenues
|
373,828
|
|
|
369,399
|
|
|
1%
|
||
|
|
|
|
|
|
||||
Segment operating expenses:
|
|
|
|
|
|
||||
Operations
|
259,977
|
|
|
255,321
|
|
|
2%
|
||
Depreciation and amortization
|
10,171
|
|
|
12,242
|
|
|
(17)%
|
||
Segment operating contribution
|
103,680
|
|
|
101,836
|
|
|
2%
|
||
|
|
|
|
|
|
||||
Other segment expenses
|
179
|
|
|
1,780
|
|
|
(90)%
|
||
Segment contribution
|
$
|
103,501
|
|
|
$
|
100,056
|
|
|
3%
|
|
|
|
|
|
|
||||
Other data:
|
|
|
|
|
|
|
|
||
Net earning assets — continuing operations (a)
|
$
|
280,673
|
|
|
$
|
270,974
|
|
|
4%
|
Inventory turnover
|
2.1
|
|
|
2.2
|
|
|
(0.1)x
|
||
Average monthly ending pawn loan balance per store (b)
|
$
|
280
|
|
|
$
|
270
|
|
|
4%
|
Monthly average yield on pawn loans outstanding
|
14
|
%
|
|
14
|
%
|
|
—
|
||
Pawn loan redemption rate
|
84
|
%
|
|
84
|
%
|
|
—
|
(a)
|
Balance includes pawn loans and inventory.
|
(b)
|
Balance is calculated based on the average of the monthly ending balance averages during the applicable period.
|
|
Change in Net Revenue
|
||||||||||
|
Pawn Service Charges
|
|
Merchandise Sales Gross Profit
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Same stores
|
$
|
8.4
|
|
|
$
|
(2.6
|
)
|
|
$
|
5.8
|
|
New stores and other
|
0.1
|
|
|
(0.5
|
)
|
|
(0.4
|
)
|
|||
Total
|
$
|
8.5
|
|
|
$
|
(3.1
|
)
|
|
$
|
5.4
|
|
Change in jewelry scrapping sales gross profit and other revenues
|
|
|
|
|
(1.0
|
)
|
|||||
Total change in net revenue
|
|
|
|
|
$
|
4.4
|
|
|
Fiscal Year Ended September 30,
|
||||||||||||||
|
2017 (GAAP)
|
|
2016 (GAAP)
|
|
Change (GAAP)
|
|
2017 (Constant Currency)
|
|
Change (Constant Currency)
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
||||||
Pawn service charges
|
$
|
34,643
|
|
|
$
|
31,907
|
|
|
9%
|
|
$
|
36,819
|
|
|
15%
|
|
|
|
|
|
|
|
|
|
|
||||||
Merchandise sales
|
62,957
|
|
|
60,331
|
|
|
4%
|
|
67,629
|
|
|
12%
|
|||
Merchandise sales gross profit
|
19,907
|
|
|
19,329
|
|
|
3%
|
|
21,383
|
|
|
11%
|
|||
Gross margin on merchandise sales
|
32
|
%
|
|
32
|
%
|
|
—
|
|
32
|
%
|
|
—
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Jewelry scrapping sales
|
2,986
|
|
|
2,282
|
|
|
31%
|
|
3,291
|
|
|
44%
|
|||
Jewelry scrapping sales gross profit
|
489
|
|
|
397
|
|
|
23%
|
|
542
|
|
|
37%
|
|||
Gross margin on jewelry scrapping sales
|
16
|
%
|
|
17
|
%
|
|
(100) bps
|
|
16
|
%
|
|
(100) bps
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Other revenues
|
645
|
|
|
385
|
|
|
68%
|
|
684
|
|
|
78%
|
|||
Net revenues
|
55,684
|
|
|
52,018
|
|
|
7%
|
|
59,428
|
|
|
14%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Segment operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||
Operations
|
36,211
|
|
|
38,481
|
|
|
(6)%
|
|
38,750
|
|
|
1%
|
|||
Depreciation and amortization
|
2,675
|
|
|
2,965
|
|
|
(10)%
|
|
2,862
|
|
|
(3)%
|
|||
Segment operating contribution
|
16,798
|
|
|
10,572
|
|
|
59%
|
|
17,816
|
|
|
69%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
Other segment expenses (a)
|
(1,856
|
)
|
|
2,064
|
|
|
*
|
|
(1,783
|
)
|
|
(a)
|
|||
Segment contribution (loss)
|
$
|
18,654
|
|
|
$
|
8,508
|
|
|
119%
|
|
$
|
19,599
|
|
|
130%
|
|
|
|
|
|
|
|
|
|
|
||||||
Other data:
|
|
|
|
|
|
|
|
|
|
||||||
Net earning assets — continuing operations (b)
|
$
|
42,952
|
|
|
$
|
36,576
|
|
|
17%
|
|
$
|
40,273
|
|
|
10%
|
Inventory turnover
|
2.4
|
|
|
2.5
|
|
|
(0.1)x
|
|
2.4
|
|
|
(0.1)x
|
|||
Average monthly ending total pawn loan balances per store (c)
|
$
|
74
|
|
|
$
|
70
|
|
|
6%
|
|
$
|
78
|
|
|
11%
|
Monthly average yield on pawn loans outstanding
|
16
|
%
|
|
16
|
%
|
|
—
|
|
16
|
%
|
|
—
|
|||
Pawn loan redemption rate
|
78
|
%
|
|
78
|
%
|
|
—
|
|
78
|
%
|
|
—
|
*
|
Represents a percentage computation that is not mathematically meaningful.
|
|||
(a)
|
Fiscal 2017 constant currency amount excludes $0.1 million of net GAAP basis foreign currency transaction gains resulting from movement in exchange rates. The net foreign currency transaction losses for fiscal 2016 were $1.3 million and are not excluded from the above results.
|
|||
(b)
|
Balance includes pawn loans and inventory.
|
|||
(c)
|
Balance is calculated based on the average of the monthly ending balance averages during the applicable period.
|
|
Change in Net Revenue
|
||||||||||
|
Pawn Service Charges
|
|
Merchandise Sales Gross Profit
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Same stores
|
$
|
2.2
|
|
|
$
|
0.3
|
|
|
$
|
2.5
|
|
New stores and other
|
0.5
|
|
|
0.3
|
|
|
0.8
|
|
|||
Total
|
$
|
2.7
|
|
|
$
|
0.6
|
|
|
$
|
3.3
|
|
Change in jewelry scrapping sales gross profit and other revenues
|
|
|
|
|
0.4
|
|
|||||
Total change in net revenue
|
|
|
|
|
$
|
3.7
|
|
|
Change in Net Revenue (Constant Currency)
|
||||||||||
|
Pawn Service Charges
|
|
Merchandise Sales Gross Profit
|
|
Total
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Same stores
|
$
|
4.2
|
|
|
$
|
1.7
|
|
|
$
|
5.9
|
|
New stores and other
|
0.7
|
|
|
0.4
|
|
|
1.1
|
|
|||
Total
|
$
|
4.9
|
|
|
$
|
2.1
|
|
|
$
|
7
|
|
Change in jewelry scrapping sales gross profit and other revenues
|
|
|
|
|
0.4
|
|
|||||
Total change in net revenue
|
|
|
|
|
$
|
7.4
|
|
•
|
A $1.4 million decrease ($0.3 million on a constant currency basis) in labor costs largely due to foreign currency impacts;
|
•
|
A $1.9 million increase in interest income as a result of our notes receivable from the sale of Grupo Finmart, including a $0.5 million gain as a result of the restructuring of the notes receivable in September 2017, combined with the ordinary accruals of interest and accretion of associated discounts;
|
•
|
A $0.5 million decrease in restructuring charges as we have substantially completed all prior restructuring actions; and
|
•
|
A $1.4 million decrease in foreign currency transaction losses; partially offset by
|
•
|
$0.6 million in losses, net of insurance recoveries, associated with the riot-related looting of 12 stores during our second fiscal quarter.
|
|
Fiscal Year Ended September 30,
|
|
Percentage Change
|
||||||
|
2017
|
|
2016
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Net revenues:
|
|
|
|
|
|
||||
Consumer loan fees and interest
|
$
|
7,983
|
|
|
$
|
8,769
|
|
|
(9)%
|
Consumer loan bad debt
|
(1,988
|
)
|
|
(1,965
|
)
|
|
1%
|
||
Other revenues, net
|
3
|
|
|
9
|
|
|
(67)%
|
||
Net revenues
|
5,998
|
|
|
6,813
|
|
|
(12)%
|
||
|
|
|
|
|
|
||||
Segment operating expenses:
|
|
|
|
|
|
||||
Operating expenses
|
8,639
|
|
|
7,803
|
|
|
11%
|
||
Equity in net (income) loss of unconsolidated affiliate
|
(4,916
|
)
|
|
255
|
|
|
*
|
||
Segment operating income (loss)
|
2,275
|
|
|
(1,245
|
)
|
|
*
|
||
|
|
|
|
|
|
||||
Impairment of investment
|
—
|
|
|
10,957
|
|
|
(100)%
|
||
Other segment (income) expense
|
(96
|
)
|
|
208
|
|
|
*
|
||
Segment income (loss)
|
$
|
2,371
|
|
|
$
|
(12,410
|
)
|
|
*
|
*
|
Represents a percentage computation that is not mathematically meaningful.
|
•
|
A
$5.2 million
increase in earnings from Cash Converters International as a result of improved operations and the completion of fiscal 2016 restructuring actions; and
|
•
|
No impairments of our investment in Cash Converters International in fiscal 2017, compared to an $11.0 million impairment ($7.2 million, net of taxes) in fiscal 2016; offset by
|
•
|
A $1.6 million increase in operating expenses due to further investment in the development of a digital IT platform that enables greater intimacy with our customers to drive future revenue enhancement.
|
|
Fiscal Year Ended September 30,
|
|
Percentage Change
|
||||||
|
2017
|
|
2016
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Segment contribution
|
$
|
124,526
|
|
|
$
|
96,154
|
|
|
30%
|
Corporate expenses (income):
|
|
|
|
|
|
||||
Administrative
|
53,254
|
|
|
68,101
|
|
|
(22)%
|
||
Depreciation and amortization
|
10,624
|
|
|
11,117
|
|
|
(4)%
|
||
Loss on sale or disposal of assets
|
27
|
|
|
269
|
|
|
(90)%
|
||
Restructuring
|
—
|
|
|
183
|
|
|
(100)%
|
||
Interest expense
|
27,794
|
|
|
16,243
|
|
|
71%
|
||
Interest income
|
(10,173
|
)
|
|
(49
|
)
|
|
20,661%
|
||
Other income
|
(239
|
)
|
|
(73
|
)
|
|
227%
|
||
Income from continuing operations before income taxes
|
43,239
|
|
|
363
|
|
|
11,812%
|
||
Income tax expense
|
11,206
|
|
|
9,361
|
|
|
20%
|
||
Income (loss) from continuing operations, net of tax
|
32,033
|
|
|
(8,998
|
)
|
|
*
|
||
Loss from discontinued operations, net of tax
|
(1,825
|
)
|
|
(79,432
|
)
|
|
(98)%
|
||
Net income (loss)
|
30,208
|
|
|
(88,430
|
)
|
|
*
|
||
Net loss attributable to noncontrolling interest
|
(1,650
|
)
|
|
(7,686
|
)
|
|
(79)%
|
||
Net income (loss) income attributable to EZCORP, Inc.
|
$
|
31,858
|
|
|
$
|
(80,744
|
)
|
|
*
|
*
|
Represents a percentage computation that is not mathematically meaningful.
|
•
|
A $7.9 million decrease in business and professional fees due to completion of internal control remediation efforts in the prior year, inclusive of $0.8 million in acquisition-related costs below; and
|
•
|
A $7.0 million decrease in labor costs including the impact of corporate headcount reductions; partially offset by
|
•
|
$1.2 million in costs related to our acquisition of GPMX in October 2017.
|
|
Fiscal Year Ended September 30,
|
|
Percentage
Change
|
||||||
|
2018
|
|
2017
|
|
|||||
|
|
|
|
|
|
||||
|
(in thousands)
|
|
|
||||||
Cash flows from operating activities
|
$
|
88,724
|
|
|
$
|
57,984
|
|
|
53%
|
Cash flows from investing activities
|
(134,206
|
)
|
|
(13,403
|
)
|
|
(901)%
|
||
Cash flows from financing activities
|
167,588
|
|
|
53,351
|
|
|
214%
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(484
|
)
|
|
724
|
|
|
*
|
||
Net increase in cash and cash equivalents
|
$
|
121,622
|
|
|
$
|
98,656
|
|
|
23%
|
*
|
Represents a percentage computation that is not mathematically meaningful.
|
•
|
$51.6 million was used to pay all outstanding borrowings under, and to terminate, the Term Loan Facility described below;
|
•
|
$34.4 million
was used to repurchase and retire
$35.0 million
aggregate principal amount of
2.125% Cash Convertible Senior Notes Due 2019 (the “
2019 Convertible Notes”), leaving $195 million aggregate principal amount of 2019 Convertible Notes outstanding; and
|
•
|
The remaining $54 million was added to our cash balances and used for general corporate purposes, including the acquisition GPMX completed in October 2017.
|
•
|
The outstanding principal amount (including the $18.3 million that would otherwise have been payable on September 27, 2017) will be payable on a monthly basis over the remaining two years, commencing October 27, 2017.
|
•
|
The per annum interest rate has been increased to 10% for the dollar-denominated note and 14.5% for the peso-denominated note. Accrued interest is also payable monthly, commencing October 27, 2017.
|
•
|
We will receive an additional deferred compensation fee of $14 million, payable $6 million on September 27, 2019, $4 million on March 27, 2020 and $4 million on September 27, 2020.
|
•
|
The Parent Loan Notes may be prepaid in full voluntarily at any time and are subject to mandatory prepayment in certain circumstances. Upon any prepayment, whether voluntary or mandatory, Grupo Finmart must pay all outstanding principal, all accrued but unpaid interest and an amount equal to the sum of (1) all remaining interest payments that would otherwise be due through the end of the term and (2) the deferred compensation fee. If the prepayment occurs on or prior to June 30, 2019, the deferred compensation fee will be reduced to $10 million.
|
•
|
The Parent Loan Notes, as amended, are now guaranteed by AlphaCredit.
|
|
|
|
Payments due by Period
|
||||||||||||||||
Contractual Obligations
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Debt obligations (a)
|
$
|
512,554
|
|
|
$
|
195,196
|
|
|
$
|
428
|
|
|
$
|
680
|
|
|
$
|
316,250
|
|
Interest on long-term debt obligations
|
54,011
|
|
|
11,267
|
|
|
16,610
|
|
|
16,537
|
|
|
9,597
|
|
|||||
Operating and other lease obligations (b)
|
229,221
|
|
|
55,811
|
|
|
92,941
|
|
|
50,784
|
|
|
29,685
|
|
|||||
Total (c) (d)
|
$
|
795,786
|
|
|
$
|
262,274
|
|
|
$
|
109,979
|
|
|
$
|
68,001
|
|
|
$
|
355,532
|
|
(c)
|
No provision for uncertain tax benefits has been included as the timing of any such payment is uncertain. See
Note 10
of Notes to Consolidated Financial Statements included in “Part II, Item 8 — Financial Statements and Supplemental Data.” Additionally, no provision for insurance reserves, deferred compensation arrangements, or other liabilities totaling $4.2 million has been included as the timing of such payments are uncertain.
|
(d)
|
Total excludes contractual obligations already recorded on our consolidated balance sheets as current liabilities, except for the accrued portions of interest and lease obligations which are included in interest on long-term debt obligations and operating and other lease obligations captions above.
|
•
|
Changes in laws and regulations;
|
•
|
Negative characterizations of our industry;
|
•
|
Concentration of business in Texas and Florida;
|
•
|
Changes in the business, regulatory, political or social climate in Latin America;
|
•
|
Changes in gold prices or volumes;
|
•
|
Changes in foreign currency exchange rates;
|
•
|
Changes in pawn redemption rates, loan default and collection rates or other important operating metrics;
|
•
|
Our ability to continue growing our store count through acquisitions and de novo openings;
|
•
|
Our ability to recruit, hire, retain and motivate talented executives and key employees;
|
•
|
Exposure to Grupo Finmart financial performance through promissory notes received in divestiture transaction;
|
•
|
The outcome of current or future litigation and regulatory proceedings;
|
•
|
Our controlled ownership structure;
|
•
|
Potential disruptive effect of acquisitions, investments and new businesses;
|
•
|
Potential regulatory fines and penalties, lawsuits and related liabilities related to firearms business;
|
•
|
Potential robberies, burglaries and other crimes at our stores;
|
•
|
Potential exposure under anti-corruption, anti-money laundering and other general business laws and regulations;
|
•
|
Changes in liquidity, capital requirements or access to debt and capital markets;
|
•
|
Changes in the competitive landscape;
|
•
|
Our ability to design or acquire, deploy and maintain adequate information technology and other business systems;
|
•
|
Potential data security breaches or other cyber-attacks;
|
•
|
Failure to achieve adequate return on investments;
|
•
|
Potential uninsured property, casualty or other losses;
|
•
|
Events beyond our control;
|
•
|
Changes in U.S. or international tax laws;
|
•
|
Financial statement impact of potential impairment of goodwill;
|
•
|
Potential conversion of Convertible Notes into cash (which could adversely affect liquidity) or stock (which will cause dilution of existing stockholders); and
|
•
|
Limited number of unreserved shares available for future issuance.
|
|
Page
|
|
|
EZCORP, Inc.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
|
|||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
Assets:
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
286,015
|
|
|
$
|
164,393
|
|
Pawn loans
|
198,463
|
|
|
169,242
|
|
||
Pawn service charges receivable, net
|
38,318
|
|
|
31,548
|
|
||
Inventory, net
|
166,997
|
|
|
154,411
|
|
||
Notes receivable, net
|
34,199
|
|
|
32,598
|
|
||
Prepaid expenses and other current assets
|
33,154
|
|
|
28,765
|
|
||
Total current assets
|
757,146
|
|
|
580,957
|
|
||
Investment in unconsolidated affiliate
|
49,500
|
|
|
43,319
|
|
||
Property and equipment, net
|
73,649
|
|
|
57,959
|
|
||
Goodwill
|
297,448
|
|
|
254,760
|
|
||
Intangible assets, net
|
54,923
|
|
|
32,420
|
|
||
Notes receivable, net
|
3,226
|
|
|
28,377
|
|
||
Deferred tax asset, net
|
7,165
|
|
|
16,856
|
|
||
Other assets
|
3,863
|
|
|
9,715
|
|
||
Total assets
|
$
|
1,246,920
|
|
|
$
|
1,024,363
|
|
|
|
|
|
||||
Liabilities and equity:
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current maturities of long-term debt, net
|
$
|
190,181
|
|
|
$
|
—
|
|
Accounts payable, accrued expenses and other current liabilities
|
57,800
|
|
|
61,543
|
|
||
Customer layaway deposits
|
11,824
|
|
|
11,032
|
|
||
Total current liabilities
|
259,805
|
|
|
72,575
|
|
||
Long-term debt, net
|
226,702
|
|
|
284,807
|
|
||
Deferred tax liability, net
|
8,817
|
|
|
—
|
|
||
Other long-term liabilities
|
6,890
|
|
|
7,055
|
|
||
Total liabilities
|
502,214
|
|
|
364,437
|
|
||
Commitments and contingencies (Note 14)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Class A Non-Voting Common Stock, par value $.01 per share; shares authorized: 100 million; issued and outstanding: 51,614,746 as of September 30, 2018 and 51,427,832 as of September 30, 2017
|
516
|
|
|
514
|
|
||
Class B Voting Common Stock, convertible, par value $.01 per share; shares authorized: 3 million; issued and outstanding: 2,970,171
|
30
|
|
|
30
|
|
||
Additional paid-in capital
|
397,927
|
|
|
348,532
|
|
||
Retained earnings
|
392,180
|
|
|
351,666
|
|
||
Accumulated other comprehensive loss
|
(42,616
|
)
|
|
(38,367
|
)
|
||
EZCORP, Inc. stockholders’ equity
|
748,037
|
|
|
662,375
|
|
||
Noncontrolling interest
|
(3,331
|
)
|
|
(2,449
|
)
|
||
Total equity
|
744,706
|
|
|
659,926
|
|
||
Total liabilities and equity
|
$
|
1,246,920
|
|
|
$
|
1,024,363
|
|
EZCORP, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||||||
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Revenues:
|
|
|
|
|
|
||||||
Merchandise sales
|
$
|
438,372
|
|
|
$
|
414,838
|
|
|
$
|
409,107
|
|
Jewelry scrapping sales
|
60,752
|
|
|
51,189
|
|
|
50,113
|
|
|||
Pawn service charges
|
305,936
|
|
|
273,080
|
|
|
261,800
|
|
|||
Other revenues
|
8,455
|
|
|
8,847
|
|
|
9,485
|
|
|||
Total revenues
|
813,515
|
|
|
747,954
|
|
|
730,505
|
|
|||
Merchandise cost of goods sold
|
276,618
|
|
|
266,525
|
|
|
258,271
|
|
|||
Jewelry scrapping cost of goods sold
|
52,290
|
|
|
43,931
|
|
|
42,039
|
|
|||
Other cost of revenues
|
1,697
|
|
|
1,988
|
|
|
1,965
|
|
|||
Net revenues
|
482,910
|
|
|
435,510
|
|
|
428,230
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Operations
|
334,649
|
|
|
304,636
|
|
|
301,387
|
|
|||
Administrative
|
53,653
|
|
|
53,254
|
|
|
68,101
|
|
|||
Depreciation and amortization
|
25,484
|
|
|
23,661
|
|
|
26,542
|
|
|||
Loss on sale or disposal of assets
|
463
|
|
|
359
|
|
|
1,106
|
|
|||
Restructuring
|
—
|
|
|
—
|
|
|
1,921
|
|
|||
Total operating expenses
|
414,249
|
|
|
381,910
|
|
|
399,057
|
|
|||
Operating income
|
68,661
|
|
|
53,600
|
|
|
29,173
|
|
|||
Interest expense
|
27,834
|
|
|
27,803
|
|
|
16,477
|
|
|||
Interest income
|
(17,041
|
)
|
|
(12,103
|
)
|
|
(81
|
)
|
|||
Equity in net (income) loss of unconsolidated affiliate
|
(5,529
|
)
|
|
(4,916
|
)
|
|
255
|
|
|||
Impairment of investment
|
11,712
|
|
|
—
|
|
|
10,957
|
|
|||
Other (income) expense
|
(5,391
|
)
|
|
(423
|
)
|
|
1,202
|
|
|||
Income from continuing operations before income taxes
|
57,076
|
|
|
43,239
|
|
|
363
|
|
|||
Income tax expense
|
18,149
|
|
|
11,206
|
|
|
9,361
|
|
|||
Income (loss) from continuing operations, net of tax
|
38,927
|
|
|
32,033
|
|
|
(8,998
|
)
|
|||
Loss from discontinued operations, net of tax
|
(856
|
)
|
|
(1,825
|
)
|
|
(79,432
|
)
|
|||
Net income (loss)
|
38,071
|
|
|
30,208
|
|
|
(88,430
|
)
|
|||
Net loss attributable to noncontrolling interest
|
(988
|
)
|
|
(1,650
|
)
|
|
(7,686
|
)
|
|||
Net income (loss) attributable to EZCORP, Inc.
|
$
|
39,059
|
|
|
$
|
31,858
|
|
|
$
|
(80,744
|
)
|
|
|
|
|
|
|
||||||
Basic earnings (loss) per share attributable to EZCORP, Inc. — continuing operations
|
$
|
0.73
|
|
|
$
|
0.62
|
|
|
$
|
(0.15
|
)
|
Diluted earnings (loss) per share attributable to EZCORP, Inc. — continuing operations
|
$
|
0.69
|
|
|
$
|
0.62
|
|
|
$
|
(0.15
|
)
|
|
|
|
|
|
|
||||||
Weighted-average basic shares outstanding
|
54,456
|
|
|
54,260
|
|
|
54,427
|
|
|||
Weighted-average diluted shares outstanding
|
57,896
|
|
|
54,368
|
|
|
54,427
|
|
EZCORP, Inc.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|||||||||||
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Net income (loss)
|
$
|
38,071
|
|
|
$
|
30,208
|
|
|
$
|
(88,430
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Foreign currency translation (loss) gain, net of income tax benefit (expense) for our investment in unconsolidated affiliate of $353, ($446) and $1,975 for the years ended September 30, 2018, 2017 and 2016, respectively
|
(2,688
|
)
|
|
5,701
|
|
|
(14,580
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
—
|
|
|
22
|
|
|||
Other comprehensive (loss) income, net of tax
|
(2,688
|
)
|
|
5,701
|
|
|
(14,558
|
)
|
|||
Comprehensive income (loss)
|
35,383
|
|
|
35,909
|
|
|
(102,988
|
)
|
|||
Comprehensive loss attributable to noncontrolling interest
|
(882
|
)
|
|
(1,671
|
)
|
|
(8,078
|
)
|
|||
Comprehensive income (loss) attributable to EZCORP, Inc.
|
$
|
36,265
|
|
|
$
|
37,580
|
|
|
$
|
(94,910
|
)
|
EZCORP, Inc.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
|
||||||||||||||||||||||||||
|
Common Stock
|
|
Additional Paid-in Capital
|
|
|
|
Accumulated Other Comprehensive (Loss) Income
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||
|
Shares
|
|
Par
Value
|
|
|
Retained
Earnings
|
|
|
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
(in thousands)
|
|||||||||||||||||||||||||
Balances as of October 1, 2015
|
53,696
|
|
|
$
|
537
|
|
|
$
|
310,038
|
|
|
$
|
400,552
|
|
|
$
|
(55,096
|
)
|
|
$
|
—
|
|
|
$
|
656,031
|
|
Stock compensation
|
—
|
|
|
—
|
|
|
9,152
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,152
|
|
||||||
Release of restricted stock
|
403
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||||
Excess tax deficiency from stock compensation
|
—
|
|
|
—
|
|
|
(295
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(295
|
)
|
||||||
Taxes paid related to net share settlement of equity awards
|
—
|
|
|
—
|
|
|
(172
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(172
|
)
|
||||||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
21
|
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,187
|
)
|
|
—
|
|
|
(14,187
|
)
|
||||||
Foreign currency translation reclassification upon disposition of Grupo Finmart
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,173
|
|
|
—
|
|
|
25,173
|
|
||||||
Acquisition of noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
246
|
|
|
246
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(80,744
|
)
|
|
—
|
|
|
(1,024
|
)
|
|
(81,768
|
)
|
||||||
Balances as of September 30, 2016
|
54,099
|
|
|
$
|
541
|
|
|
$
|
318,723
|
|
|
$
|
319,808
|
|
|
$
|
(44,089
|
)
|
|
$
|
(778
|
)
|
|
$
|
594,205
|
|
Stock compensation
|
—
|
|
|
—
|
|
|
5,831
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,831
|
|
||||||
Release of restricted stock
|
299
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||
Taxes paid related to net share settlement of equity awards
|
—
|
|
|
—
|
|
|
(767
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(767
|
)
|
||||||
Reclassification of 2019 Convertible Notes Warrants to liabilities
|
—
|
|
|
—
|
|
|
(523
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(523
|
)
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,722
|
|
|
(21
|
)
|
|
5,701
|
|
||||||
Equity classified conversion feature of 2024 Convertible Notes, net of tax
|
—
|
|
|
—
|
|
|
25,268
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,268
|
|
||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
31,858
|
|
|
—
|
|
|
(1,650
|
)
|
|
30,208
|
|
||||||
Balances as of September 30, 2017
|
54,398
|
|
|
$
|
544
|
|
|
$
|
348,532
|
|
|
$
|
351,666
|
|
|
$
|
(38,367
|
)
|
|
$
|
(2,449
|
)
|
|
$
|
659,926
|
|
Stock compensation
|
—
|
|
|
—
|
|
|
10,711
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,711
|
|
||||||
Release of restricted stock
|
187
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||||
Taxes paid related to net share settlement of equity awards
|
—
|
|
|
—
|
|
|
(311
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(311
|
)
|
||||||
Reclassification of stranded tax effects resulting from the Tax Cuts and Jobs Act
|
—
|
|
|
—
|
|
|
—
|
|
|
1,455
|
|
|
(1,455
|
)
|
|
—
|
|
|
—
|
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,794
|
)
|
|
106
|
|
|
(2,688
|
)
|
||||||
Equity classified conversion feature of 2025 Convertible Notes, net of tax
|
—
|
|
|
—
|
|
|
38,995
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,995
|
|
||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
39,059
|
|
|
—
|
|
|
(988
|
)
|
|
38,071
|
|
||||||
Balances as of September 30, 2018
|
54,585
|
|
|
$
|
546
|
|
|
$
|
397,927
|
|
|
$
|
392,180
|
|
|
$
|
(42,616
|
)
|
|
$
|
(3,331
|
)
|
|
$
|
744,706
|
|
EZCORP, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||||||
Pawn loans forfeited and transferred to inventory
|
$
|
274,590
|
|
|
$
|
257,388
|
|
|
$
|
249,316
|
|
Dividend reinvestment acquisition of additional ownership in unconsolidated affiliate
|
—
|
|
|
1,153
|
|
|
—
|
|
*
|
Fiscal 2016 amount is primarily comprised of discontinued operations. See
Note 16
of Notes to Consolidated Financial Statements included in “Part II, Item 8 — Financial Statements and Supplemental Data.”
|
•
|
508
United States pawn stores (operating primarily as EZPAWN or Value Pawn & Jewelry);
|
•
|
340
Mexico pawn stores (operating primarily as Empeño Fácil);
|
•
|
113
pawn stores in Guatemala, El Salvador, Honduras and Peru (operating as GuatePrenda and MaxiEfectivo); and
|
•
|
27
financial services stores in Canada (operating as CASHMAX).
|
•
|
In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40). This ASU provides guidance around accounting for implementation costs incurred in a cloud computing arrangement. The provisions of this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted based upon guidance issued within the ASU. A reporting entity should apply the amendment either retrospectively or prospectively based on the specific guidance within the ASU. We are currently assessing the effect of adoption on our financial position, results of operations or cash flows.
|
•
|
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework. This ASU modifies the disclosure requirements for fair value measurements in Accounting Standards Codification (“ASC”) 820. The provisions of this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted based upon guidance issued within the ASU. A reporting entity should apply the amendment either retrospectively or prospectively based on the specific guidance within the ASU. We do not anticipate that the adoption of the ASU will have a material effect on our disclosures.
|
•
|
In May 2017, the FASB issued ASU 2017-09, Compensation — Stock Compensation (Topic 718). This ASU provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. We will adopt ASU 2017-09 on October 1, 2018 and such adoption will not have an effect on our financial position, results of operations or cash flows.
|
•
|
In November 2016, the FASB issued ASU 2016-18 Statement of Cash Flows (Topic 230): Restricted Cash. This ASU requires the inclusion of restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The provisions of this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. We will adopt ASU 2016-18 on October 1, 2018 and such adoption will not have a material effect on our consolidated statements of cash flows.
|
•
|
In August 2016, the FASB issued ASU 2016-15 Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This ASU provides guidance on eight specific cash flow issues. The provisions of this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. We will adopt ASU 2016-15 on October 1, 2018 and such adoption will not have an effect on our consolidated statements of cash flows.
|
•
|
In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU requires financial assets (or groups of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected, among other provisions. The provisions of this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A reporting entity should generally apply the amendment on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting periods in which the amendment is effective. We have not identified any impacts to our financial statements as a result of adopting the ASU that we believe will be material, although we continue to evaluate the impact of adoption. We will complete our implementation to allow for proper recognition, presentation and disclosure upon adoption of the ASU which is effective for our fiscal 2021.
|
•
|
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This ASU requires companies to generally recognize on the balance sheet operating and financing lease liabilities and corresponding right-of-use assets. The provisions of this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted based upon guidance issued within the ASU. We are in the process of evaluating the impact of adopting ASU 2016-02 on our consolidated financial position, results of operations and cash flows, and anticipate a material impact on our consolidated financial position. Additionally, we are evaluating the disclosure requirements under this ASU and are identifying and preparing to implement changes to our accounting policies, practices and controls to support adoption of the ASU and have completed upgrades to our third-party software solution to support adoption. We will complete our implementation to allow for proper recognition, presentation and disclosure upon adoption of the ASU which is effective for our fiscal 2020. We currently plan to adopt this ASU using the optional transition method provided under ASU 2018-11, Leases, (Topic 842): Targeted Improvement which was issued in July 2018, allowing for application of ASU 2016-02 at the adoption date, with recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption.
|
•
|
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606) to defer the effective date to December 15, 2017 for annual reporting periods beginning after that date, with early adoption permitted, but not before the original effective date of December 15, 2016. The core principle of the ASU, and the subsequently issued ASUs modifying or clarifying the ASU, is that an entity should recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, the guidance provides that an entity should apply the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the entity satisfies a performance obligation. The new standard allows for two methods of adoption: (a) full retrospective adoption, meaning the standard is applied to all periods presented, or (b) modified retrospective adoption, meaning the cumulative effect of applying the new standard is recognized as an adjustment to the opening retained earnings balance.
|
|
|
GPMX
|
|
All Other
|
||||
|
|
|
|
|
||||
|
|
(in thousands)
|
||||||
Cash and cash equivalents
|
|
$
|
2,560
|
|
|
$
|
—
|
|
Earning assets
|
|
17,247
|
|
|
8,347
|
|
||
Other assets
|
|
3,450
|
|
|
4,272
|
|
||
Property and equipment, intangible assets, deferred taxes and other assets, net*
|
|
11,671
|
|
|
13,678
|
|
||
Goodwill
|
|
33,511
|
|
|
9,015
|
|
||
Accounts payable, deferred taxes and other liabilities
|
|
(6,723
|
)
|
|
(159
|
)
|
||
Total consideration
|
|
$
|
61,716
|
|
|
$
|
35,153
|
|
*
|
Intangible assets consist primarily of
$9.8 million
and
$6.6 million
in trade names acquired with indefinite useful lives, for GPMX and All Other, respectively.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Net income (loss) from continuing operations attributable to EZCORP (A)
|
$
|
39,915
|
|
|
$
|
33,683
|
|
|
$
|
(7,973
|
)
|
Loss from discontinued operations, net of tax (B)
|
(856
|
)
|
|
(1,825
|
)
|
|
(72,771
|
)
|
|||
Net income (loss) attributable to EZCORP (C)
|
$
|
39,059
|
|
|
$
|
31,858
|
|
|
$
|
(80,744
|
)
|
|
|
|
|
|
|
||||||
Weighted average outstanding shares of common stock (D)
|
54,456
|
|
|
54,260
|
|
|
54,427
|
|
|||
Dilutive effect of restricted stock and 2024 Convertible Notes*
|
3,440
|
|
|
108
|
|
|
—
|
|
|||
Weighted average common stock and common stock equivalents (E)
|
57,896
|
|
|
54,368
|
|
|
54,427
|
|
|||
|
|
|
|
|
|
||||||
Basic earnings (loss) per share attributable to EZCORP:
|
|
|
|
|
|
||||||
Continuing operations (A / D)
|
$
|
0.73
|
|
|
$
|
0.62
|
|
|
$
|
(0.15
|
)
|
Discontinued operations (B / D)
|
(0.01
|
)
|
|
(0.03
|
)
|
|
(1.34
|
)
|
|||
Basic earnings (loss) per share (C / D)
|
$
|
0.72
|
|
|
$
|
0.59
|
|
|
$
|
(1.49
|
)
|
|
|
|
|
|
|
||||||
Diluted earnings (loss) per share attributable to EZCORP:
|
|
|
|
|
|
||||||
Continuing operations (A / E)
|
$
|
0.69
|
|
|
$
|
0.62
|
|
|
$
|
(0.15
|
)
|
Discontinued operations (B / E)
|
(0.01
|
)
|
|
(0.03
|
)
|
|
(1.34
|
)
|
|||
Diluted earnings (loss) per share (C / E)
|
$
|
0.68
|
|
|
$
|
0.59
|
|
|
$
|
(1.49
|
)
|
|
|
|
|
|
|
||||||
Potential common shares excluded from the calculation of diluted earnings per share above, exclusive of the additional potential impact of the 2019 Convertible Notes Warrants, 2024 Convertible Notes and 2025 Convertible Notes*:
|
|
|
|
|
|
||||||
Restricted stock**
|
2,218
|
|
|
2,356
|
|
|
840
|
|
*
|
See
Note 8
for discussion of the terms and conditions of these potential common shares and dilutive impact thereon.
|
**
|
Includes antidilutive share-based awards as well as performance-based and market conditioned share-based awards that are contingently issuable, but for which the condition for issuance has not been met as of the end of the reporting period.
|
|
June 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Current assets
|
$
|
229,105
|
|
|
$
|
155,749
|
|
Non-current assets
|
148,195
|
|
|
150,843
|
|
||
Total assets
|
$
|
377,300
|
|
|
$
|
306,592
|
|
|
|
|
|
||||
Current liabilities
|
$
|
122,924
|
|
|
$
|
57,387
|
|
Non-current liabilities
|
15,449
|
|
|
48,698
|
|
||
Shareholders’ equity
|
238,927
|
|
|
200,507
|
|
||
Total liabilities and shareholders’ equity
|
$
|
377,300
|
|
|
$
|
306,592
|
|
|
|
Carrying Value
|
|
Estimated Fair Value
|
||||||||||||||||
|
|
September 30, 2018
|
|
September 30, 2018
|
|
Fair Value Measurement Using
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Notes receivable, net
|
|
$
|
37,425
|
|
|
$
|
41,153
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
41,153
|
|
Investment in unconsolidated affiliate
|
|
49,500
|
|
|
49,500
|
|
|
49,500
|
|
|
—
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2019 Convertible Notes
|
|
$
|
187,433
|
|
|
$
|
189,150
|
|
|
$
|
—
|
|
|
$
|
189,150
|
|
|
$
|
—
|
|
2024 Convertible Notes
|
|
105,858
|
|
|
180,399
|
|
|
—
|
|
|
180,399
|
|
|
—
|
|
|||||
2025 Convertible Notes
|
|
119,736
|
|
|
161,253
|
|
|
—
|
|
|
161,253
|
|
|
—
|
|
|||||
8.5% unsecured notes due 2024
|
|
1,304
|
|
|
1,304
|
|
|
—
|
|
|
—
|
|
|
1,304
|
|
|
|
Carrying Value
|
|
Estimated Fair Value
|
||||||||||||||||
|
|
September 30, 2017
|
|
September 30, 2017
|
|
Fair Value Measurement Using
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Notes receivable, net
|
|
$
|
60,975
|
|
|
$
|
74,262
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
74,262
|
|
Investment in unconsolidated affiliate
|
|
43,319
|
|
|
49,057
|
|
|
49,057
|
|
|
—
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2019 Convertible Notes
|
|
$
|
177,346
|
|
|
$
|
193,811
|
|
|
$
|
—
|
|
|
$
|
193,811
|
|
|
$
|
—
|
|
2024 Convertible Notes
|
|
100,870
|
|
|
175,016
|
|
|
—
|
|
|
175,016
|
|
|
—
|
|
•
|
The outstanding principal amount (including the
$18.3 million
that would otherwise have been payable on September 27, 2017) will be payable on a monthly basis over the remaining
two years
, commencing October 27, 2017.
|
•
|
The per annum interest rate was increased from
4%
to
10%
for the dollar-denominated note and from
7.5%
to
14.5%
for the peso-denominated note. Accrued interest is also payable monthly, commencing October 27, 2017.
|
•
|
We will receive an additional deferred compensation fee of
$14.0 million
, payable
$6.0 million
on September 27, 2019,
$4.0 million
on March 27, 2020 and
$4.0 million
on September 27, 2020.
|
•
|
The Parent Loan Notes may be prepaid in full voluntarily at any time and are subject to mandatory prepayment in certain circumstances. Upon any prepayment, whether voluntary or mandatory, Grupo Finmart must pay all outstanding principal, all accrued but unpaid interest and an amount equal to the sum of (1) all remaining interest payments that would otherwise be due through the end of the term and (2) the deferred compensation fee. If the prepayment occurs on or prior to June 30, 2019, the deferred compensation fee will be reduced to
$10.0 million
.
|
•
|
The Parent Loan Notes, as amended, are now fully guaranteed by AlphaCredit.
|
|
|
|
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||||
Instrument
|
|
Balance Sheet Location
|
|
Asset Recorded in Consolidated Balance Sheet
|
|
Maximum Exposure to Loss
|
|
Asset Recorded in Consolidated Balance Sheet
|
|
Maximum Exposure to Loss
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
Notes receivable
|
|
Notes receivable, net (including accreted deferred compensation of $9.2 million and $0.1 million as of September 30, 2018 and 2017, respectively)
|
|
$
|
37,425
|
|
|
$
|
37,425
|
|
|
$
|
60,975
|
|
|
$
|
60,975
|
|
|
September 30,
|
||||||||||||||||||||||
|
2018
|
|
2017
|
||||||||||||||||||||
|
Carrying
Amount
|
|
Accumulated
Depreciation
|
|
Net Book
Value
|
|
Carrying
Amount |
|
Accumulated
Depreciation |
|
Net Book
Value |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Land
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Buildings and improvements
|
97,236
|
|
|
(60,459
|
)
|
|
36,777
|
|
|
80,828
|
|
|
(55,077
|
)
|
|
25,751
|
|
||||||
Furniture and equipment
|
119,975
|
|
|
(85,737
|
)
|
|
34,238
|
|
|
105,319
|
|
|
(78,581
|
)
|
|
26,738
|
|
||||||
Software
|
34,178
|
|
|
(33,177
|
)
|
|
1,001
|
|
|
34,022
|
|
|
(32,623
|
)
|
|
1,399
|
|
||||||
In progress
|
1,629
|
|
|
—
|
|
|
1,629
|
|
|
4,067
|
|
|
—
|
|
|
4,067
|
|
||||||
|
$
|
253,022
|
|
|
$
|
(179,373
|
)
|
|
$
|
73,649
|
|
|
$
|
224,240
|
|
|
$
|
(166,281
|
)
|
|
$
|
57,959
|
|
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Pawn licenses
|
$
|
9,527
|
|
|
$
|
9,535
|
|
Trade names
|
20,776
|
|
|
4,000
|
|
||
|
$
|
30,303
|
|
|
$
|
13,535
|
|
|
U.S. Pawn
|
|
Latin America Pawn
|
|
Consolidated
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Balances as of September 30, 2016
|
$
|
247,538
|
|
|
$
|
6,438
|
|
|
$
|
253,976
|
|
Acquisitions
|
356
|
|
|
—
|
|
|
356
|
|
|||
Effect of foreign currency translation changes
|
—
|
|
|
428
|
|
|
428
|
|
|||
Balances as of September 30, 2017
|
$
|
247,894
|
|
|
$
|
6,866
|
|
|
$
|
254,760
|
|
Acquisitions
|
—
|
|
|
42,526
|
|
|
42,526
|
|
|||
Effect of foreign currency translation changes
|
—
|
|
|
162
|
|
|
162
|
|
|||
Balances as of September 30, 2018
|
$
|
247,894
|
|
|
$
|
49,554
|
|
|
$
|
297,448
|
|
|
September 30,
|
||||||||||||||||||||||
|
2018
|
|
2017
|
||||||||||||||||||||
|
Carrying Amount
|
|
Accumulated Amortization
|
|
Net Book Value
|
|
Carrying Amount
|
|
Accumulated Amortization
|
|
Net Book Value
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Non-compete agreements
|
$
|
3,626
|
|
|
$
|
(3,314
|
)
|
|
$
|
312
|
|
|
$
|
3,659
|
|
|
$
|
(3,102
|
)
|
|
$
|
557
|
|
Internally developed software
|
40,223
|
|
|
(17,512
|
)
|
|
22,711
|
|
|
29,741
|
|
|
(12,597
|
)
|
|
17,144
|
|
||||||
Other
|
3,826
|
|
|
(2,229
|
)
|
|
1,597
|
|
|
3,148
|
|
|
(1,964
|
)
|
|
1,184
|
|
||||||
|
$
|
47,675
|
|
|
$
|
(23,055
|
)
|
|
$
|
24,620
|
|
|
$
|
36,548
|
|
|
$
|
(17,663
|
)
|
|
$
|
18,885
|
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Amortization expense in continuing operations
|
$
|
5,780
|
|
|
$
|
4,184
|
|
|
$
|
4,742
|
|
Amortization expense in discontinued operations
|
—
|
|
|
—
|
|
|
2,055
|
|
|||
Operations expense
|
199
|
|
|
90
|
|
|
87
|
|
|||
|
$
|
5,979
|
|
|
$
|
4,274
|
|
|
$
|
6,884
|
|
Fiscal Year Ended September 30,
|
|
Amortization expense
|
|
Operations expense
|
||||
|
|
|
|
|
||||
|
|
(in thousands)
|
||||||
2019
|
|
$
|
6,372
|
|
|
$
|
23
|
|
2020
|
|
5,803
|
|
|
23
|
|
||
2021
|
|
4,746
|
|
|
23
|
|
||
2022
|
|
3,858
|
|
|
2
|
|
||
2023
|
|
1,696
|
|
|
—
|
|
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||||||||||||
|
Gross Amount
|
|
Debt Discount and Issuance Costs
|
|
Carrying
Amount
|
|
Gross Amount
|
|
Debt Discount and Issuance Costs
|
|
Carrying
Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
2019 Convertible Notes
|
$
|
195,000
|
|
|
$
|
(7,567
|
)
|
|
$
|
187,433
|
|
|
$
|
195,000
|
|
|
$
|
(17,654
|
)
|
|
$
|
177,346
|
|
2019 Convertible Notes Embedded Derivative
|
2,552
|
|
|
—
|
|
|
2,552
|
|
|
6,591
|
|
|
—
|
|
|
6,591
|
|
||||||
2024 Convertible Notes
|
143,750
|
|
|
(37,892
|
)
|
|
105,858
|
|
|
143,750
|
|
|
(42,880
|
)
|
|
100,870
|
|
||||||
2025 Convertible Notes
|
172,500
|
|
|
(52,764
|
)
|
|
119,736
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
8.5% unsecured notes due 2024*
|
1,304
|
|
|
—
|
|
|
1,304
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
$
|
515,106
|
|
|
$
|
(98,223
|
)
|
|
$
|
416,883
|
|
|
$
|
345,341
|
|
|
$
|
(60,534
|
)
|
|
$
|
284,807
|
|
Less current portion
|
197,748
|
|
|
(7,567
|
)
|
|
190,181
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total long-term debt
|
$
|
317,358
|
|
|
$
|
(90,656
|
)
|
|
$
|
226,702
|
|
|
$
|
345,341
|
|
|
$
|
(60,534
|
)
|
|
$
|
284,807
|
|
*
|
Amount translated from Guatemalan quetzals as of September 30, 2018. Certain disclosures omitted due to materiality considerations.
|
|
Principal Payment Schedule
|
||||||||||||||||||
|
Total
|
|
Less Than 1 Year
|
|
1 - 3 Years
|
|
3 - 5 Years
|
|
More Than 5 Years
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
2019 Convertible Notes*
|
$
|
195,000
|
|
|
$
|
195,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2024 Convertible Notes*
|
143,750
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
143,750
|
|
|||||
2025 Convertible Notes*
|
172,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
172,500
|
|
|||||
8.5% unsecured notes due 2024
|
1,304
|
|
|
196
|
|
|
428
|
|
|
428
|
|
|
252
|
|
|||||
|
$
|
512,554
|
|
|
$
|
195,196
|
|
|
$
|
428
|
|
|
$
|
428
|
|
|
$
|
316,502
|
|
*
|
Excludes the potential impact of the embedded derivative.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in millions)
|
||||||||||
Term Loan Facility:
|
|
|
|
|
|
||||||
Contractual interest expense
|
$
|
—
|
|
|
$
|
4.3
|
|
|
$
|
0.4
|
|
Amortization of debt discount and deferred financing costs
|
—
|
|
|
0.4
|
|
|
—
|
|
|||
Total interest expense
|
$
|
—
|
|
|
$
|
4.7
|
|
|
$
|
0.4
|
|
|
|
|
|
|
|
||||||
2019 Convertible Notes:
|
|
|
|
|
|
||||||
Contractual interest expense
|
$
|
4.1
|
|
|
$
|
4.7
|
|
|
$
|
4.9
|
|
Amortization of debt discount and deferred financing costs
|
10.0
|
|
|
10.8
|
|
|
10.6
|
|
|||
Total interest expense
|
$
|
14.1
|
|
|
$
|
15.5
|
|
|
$
|
15.5
|
|
|
|
|
|
|
|
||||||
2024 Convertible Notes:
|
|
|
|
|
|
||||||
Contractual interest expense
|
$
|
4.1
|
|
|
$
|
1.0
|
|
|
$
|
—
|
|
Amortization of debt discount and deferred financing costs
|
5.1
|
|
|
1.1
|
|
|
—
|
|
|||
Total interest expense
|
$
|
9.2
|
|
|
$
|
2.1
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
2025 Convertible Notes:
|
|
|
|
|
|
||||||
Contractual interest expense
|
$
|
1.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Amortization of debt discount and deferred financing costs
|
2.3
|
|
|
—
|
|
|
—
|
|
|||
Total interest expense
|
$
|
3.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Share-based compensation costs
|
$
|
10,784
|
|
|
$
|
5,866
|
|
|
$
|
5,346
|
|
Income tax benefits on share-based compensation
|
(1,656
|
)
|
|
(2,053
|
)
|
|
(1,871
|
)
|
(a)
|
29,160
shares were withheld to satisfy related federal income tax withholding.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in millions except per share amounts)
|
||||||||||
Weighted average grant-date fair value per share granted (a)
|
$
|
9.75
|
|
|
$
|
9.57
|
|
|
$
|
3.53
|
|
Total grant date fair value of shares vested
|
$
|
2.3
|
|
|
$
|
3.8
|
|
|
$
|
2.3
|
|
(a)
|
Awards with performance and time-based vesting provisions are generally valued based upon the underlying share price as of the issuance date.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Domestic*
|
$
|
29,001
|
|
|
$
|
29,740
|
|
|
$
|
(17
|
)
|
Foreign
|
28,075
|
|
|
13,499
|
|
|
380
|
|
|||
|
$
|
57,076
|
|
|
$
|
43,239
|
|
|
$
|
363
|
|
*
|
Includes the majority of our corporate administrative costs. See Note 15 for information pertaining to segment contribution.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
(26
|
)
|
|
$
|
1,092
|
|
|
$
|
11,120
|
|
State and foreign
|
9,470
|
|
|
6,359
|
|
|
3,193
|
|
|||
|
9,444
|
|
|
7,451
|
|
|
14,313
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal*
|
9,076
|
|
|
5,190
|
|
|
(3,766
|
)
|
|||
State and foreign
|
(371
|
)
|
|
(1,435
|
)
|
|
(1,186
|
)
|
|||
|
8,705
|
|
|
3,755
|
|
|
(4,952
|
)
|
|||
Total income tax expense
|
$
|
18,149
|
|
|
$
|
11,206
|
|
|
$
|
9,361
|
|
*
|
The year ended September 30, 2018 includes a
$2.1 million
charge resulting from the remeasurement of our domestic net deferred tax assets based on the new corporate income tax rate as a result of the Act, as well as
$2.6 million
charge resulting from recording a valuation allowance against foreign tax credit carryforwards that do not meet the “more likely than not” threshold to be utilized as a result of tax law changes included in the Act.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Income tax expense at the federal statutory rate
|
$
|
14,000
|
|
|
$
|
15,134
|
|
|
$
|
128
|
|
State taxes, net of federal benefit
|
1,265
|
|
|
(714
|
)
|
|
2,476
|
|
|||
Mexico inflation adjustment
|
(936
|
)
|
|
(1,286
|
)
|
|
(142
|
)
|
|||
Non-deductible items
|
2,214
|
|
|
1,114
|
|
|
1,860
|
|
|||
Tax credits
|
(615
|
)
|
|
(321
|
)
|
|
2,788
|
|
|||
Foreign rate differential
|
1,405
|
|
|
(172
|
)
|
|
277
|
|
|||
Change in net operating loss carryforward
|
—
|
|
|
1,180
|
|
|
—
|
|
|||
Change in valuation allowance
|
3,986
|
|
|
(3,211
|
)
|
|
1,511
|
|
|||
Stock compensation
|
—
|
|
|
(386
|
)
|
|
—
|
|
|||
Uncertain tax positions
|
(4,808
|
)
|
|
674
|
|
|
—
|
|
|||
Change in tax rate resulting from enactment of the Act
|
2,060
|
|
|
—
|
|
|
—
|
|
|||
Other
|
(422
|
)
|
|
(806
|
)
|
|
463
|
|
|||
Total income tax expense
|
$
|
18,149
|
|
|
$
|
11,206
|
|
|
$
|
9,361
|
|
Effective tax rate
|
32
|
%
|
|
26
|
%
|
|
2,579
|
%
|
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Cash Converters International
|
$
|
9,782
|
|
|
$
|
13,550
|
|
Tax over book inventory
|
8,803
|
|
|
10,094
|
|
||
Accrued liabilities
|
4,667
|
|
|
6,957
|
|
||
Pawn service charges receivable
|
4,512
|
|
|
8,687
|
|
||
Stock compensation
|
3,328
|
|
|
3,356
|
|
||
Foreign tax credit
|
2,638
|
|
|
3,132
|
|
||
Capital loss carryforward
|
3,006
|
|
|
5,010
|
|
||
State and foreign net operating loss carryforwards
|
15,215
|
|
|
13,671
|
|
||
Book over tax depreciation
|
972
|
|
|
2,678
|
|
||
Other
|
137
|
|
|
162
|
|
||
Total deferred tax assets before valuation allowance
|
53,060
|
|
|
67,297
|
|
||
Valuation allowance
|
(20,254
|
)
|
|
(17,860
|
)
|
||
Net deferred tax assets
|
32,806
|
|
|
49,437
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Tax over book amortization
|
15,700
|
|
|
20,629
|
|
||
Note receivable discount
|
17,396
|
|
|
10,569
|
|
||
Prepaid expenses
|
1,362
|
|
|
1,383
|
|
||
Total deferred tax liabilities
|
34,458
|
|
|
32,581
|
|
||
Net deferred tax (liability) asset
|
$
|
(1,652
|
)
|
|
$
|
16,856
|
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Beginning balance
|
$
|
6,530
|
|
|
$
|
6,058
|
|
|
$
|
6,058
|
|
Increase for tax positions taken during a prior period
|
963
|
|
|
—
|
|
|
—
|
|
|||
Increase for tax positions taken during the current period
|
—
|
|
|
472
|
|
|
—
|
|
|||
Decrease for tax positions as a result of the lapse of the statute of limitations
|
(4,402
|
)
|
|
—
|
|
|
—
|
|
|||
Ending balance
|
$
|
3,091
|
|
|
$
|
6,530
|
|
|
$
|
6,058
|
|
Fiscal Year Ended September 30,
|
Operating Lease Payments
|
|
Sublease Revenue
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
2019
|
$
|
55,811
|
|
|
$
|
3,249
|
|
2020
|
50,174
|
|
|
3,335
|
|
||
2021
|
42,767
|
|
|
3,402
|
|
||
2022
|
30,911
|
|
|
2,908
|
|
||
2023
|
19,873
|
|
|
1,561
|
|
||
Thereafter
|
29,685
|
|
|
1,043
|
|
||
|
$
|
229,221
|
|
|
$
|
15,498
|
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Gross rent expense from continuing operations
|
$
|
61,821
|
|
|
$
|
56,794
|
|
|
$
|
56,707
|
|
Sublease rent revenue from continuing operations
|
(109
|
)
|
|
(56
|
)
|
|
(156
|
)
|
|||
Net rent expense from continuing operations
|
$
|
61,712
|
|
|
$
|
56,738
|
|
|
$
|
56,551
|
|
•
|
Each of our executive officers will receive salary continuation for
one
year if his or her employment is terminated without cause.
|
•
|
Generally, restricted stock awards, including those granted to the executive officers, provide for accelerated vesting of some or all of the unvested shares in the event of the holder’s death or disability.
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Matching contributions to EZCORP Inc. 401(k) Plan and Trust
|
$
|
810
|
|
|
$
|
658
|
|
|
$
|
468
|
|
|
Fiscal Year Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
|
(in thousands)
|
||||||||||
Contributions to the Supplemental Executive Retirement Plan
|
$
|
483
|
|
|
$
|
536
|
|
|
$
|
636
|
|
Amortized expense due to Supplemental Executive Retirement Plan
|
476
|
|
|
544
|
|
|
153
|
|
|
Fiscal Year Ended September 30, 2018
|
||||||||||||||||||||||
|
U.S. Pawn
|
|
Latin America Pawn
|
|
Other
International
|
|
Total Segments
|
|
Corporate Items
|
|
Consolidated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Merchandise sales
|
$
|
350,699
|
|
|
$
|
87,673
|
|
|
$
|
—
|
|
|
$
|
438,372
|
|
|
$
|
—
|
|
|
$
|
438,372
|
|
Jewelry scrapping sales
|
47,745
|
|
|
13,007
|
|
|
—
|
|
|
60,752
|
|
|
—
|
|
|
60,752
|
|
||||||
Pawn service charges
|
237,461
|
|
|
68,475
|
|
|
—
|
|
|
305,936
|
|
|
—
|
|
|
305,936
|
|
||||||
Other revenues
|
250
|
|
|
85
|
|
|
8,120
|
|
|
8,455
|
|
|
—
|
|
|
8,455
|
|
||||||
Total revenues
|
636,155
|
|
|
169,240
|
|
|
8,120
|
|
|
813,515
|
|
|
—
|
|
|
813,515
|
|
||||||
Merchandise cost of goods sold
|
216,408
|
|
|
60,210
|
|
|
—
|
|
|
276,618
|
|
|
—
|
|
|
276,618
|
|
||||||
Jewelry scrapping cost of goods sold
|
40,417
|
|
|
11,873
|
|
|
—
|
|
|
52,290
|
|
|
—
|
|
|
52,290
|
|
||||||
Other cost of revenues
|
—
|
|
|
—
|
|
|
1,697
|
|
|
1,697
|
|
|
—
|
|
|
1,697
|
|
||||||
Net revenues
|
379,330
|
|
|
97,157
|
|
|
6,423
|
|
|
482,910
|
|
|
—
|
|
|
482,910
|
|
||||||
Operating expenses (income):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operations
|
263,094
|
|
|
61,361
|
|
|
10,194
|
|
|
334,649
|
|
|
—
|
|
|
334,649
|
|
||||||
Administrative
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53,653
|
|
|
53,653
|
|
||||||
Depreciation and amortization
|
12,869
|
|
|
4,068
|
|
|
184
|
|
|
17,121
|
|
|
8,363
|
|
|
25,484
|
|
||||||
Loss on sale or disposal of assets
|
203
|
|
|
27
|
|
|
—
|
|
|
230
|
|
|
233
|
|
|
463
|
|
||||||
Interest expense
|
71
|
|
|
25
|
|
|
—
|
|
|
96
|
|
|
27,738
|
|
|
27,834
|
|
||||||
Interest income
|
—
|
|
|
(2,619
|
)
|
|
—
|
|
|
(2,619
|
)
|
|
(14,422
|
)
|
|
(17,041
|
)
|
||||||
Equity in net income of unconsolidated affiliate
|
—
|
|
|
—
|
|
|
(5,529
|
)
|
|
(5,529
|
)
|
|
—
|
|
|
(5,529
|
)
|
||||||
Impairment of investment
|
—
|
|
|
—
|
|
|
11,712
|
|
|
11,712
|
|
|
—
|
|
|
11,712
|
|
||||||
Other income
|
(3
|
)
|
|
(42
|
)
|
|
(132
|
)
|
|
(177
|
)
|
|
(5,214
|
)
|
|
(5,391
|
)
|
||||||
Segment contribution (loss)
|
$
|
103,096
|
|
|
$
|
34,337
|
|
|
$
|
(10,006
|
)
|
|
$
|
127,427
|
|
|
|
|
|
|
|
||
Income from continuing operations before income taxes
|
|
|
|
|
|
|
$
|
127,427
|
|
|
$
|
(70,351
|
)
|
|
$
|
57,076
|
|
|
Fiscal Year Ended September 30, 2017
|
||||||||||||||||||||||
|
U.S. Pawn
|
|
Latin America Pawn
|
|
Other
International |
|
Total Segments
|
|
Corporate Items
|
|
Consolidated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Merchandise sales
|
$
|
351,878
|
|
|
$
|
62,957
|
|
|
$
|
3
|
|
|
$
|
414,838
|
|
|
$
|
—
|
|
|
$
|
414,838
|
|
Jewelry scrapping sales
|
48,203
|
|
|
2,986
|
|
|
—
|
|
|
51,189
|
|
|
—
|
|
|
51,189
|
|
||||||
Pawn service charges
|
238,437
|
|
|
34,643
|
|
|
—
|
|
|
273,080
|
|
|
—
|
|
|
273,080
|
|
||||||
Other revenues
|
219
|
|
|
645
|
|
|
7,983
|
|
|
8,847
|
|
|
—
|
|
|
8,847
|
|
||||||
Total revenues
|
638,737
|
|
|
101,231
|
|
|
7,986
|
|
|
747,954
|
|
|
—
|
|
|
747,954
|
|
||||||
Merchandise cost of goods sold
|
223,475
|
|
|
43,050
|
|
|
—
|
|
|
266,525
|
|
|
—
|
|
|
266,525
|
|
||||||
Jewelry scrapping cost of goods sold
|
41,434
|
|
|
2,497
|
|
|
—
|
|
|
43,931
|
|
|
—
|
|
|
43,931
|
|
||||||
Other cost of revenues
|
—
|
|
|
—
|
|
|
1,988
|
|
|
1,988
|
|
|
—
|
|
|
1,988
|
|
||||||
Net revenues
|
373,828
|
|
|
55,684
|
|
|
5,998
|
|
|
435,510
|
|
|
—
|
|
|
435,510
|
|
||||||
Operating expenses (income):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operations
|
259,977
|
|
|
36,211
|
|
|
8,448
|
|
|
304,636
|
|
|
—
|
|
|
304,636
|
|
||||||
Administrative
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
53,254
|
|
|
53,254
|
|
||||||
Depreciation and amortization
|
10,171
|
|
|
2,675
|
|
|
191
|
|
|
13,037
|
|
|
10,624
|
|
|
23,661
|
|
||||||
Loss on sale or disposal of assets
|
198
|
|
|
134
|
|
|
—
|
|
|
332
|
|
|
27
|
|
|
359
|
|
||||||
Interest expense
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
|
27,794
|
|
|
27,803
|
|
||||||
Interest income
|
—
|
|
|
(1,930
|
)
|
|
—
|
|
|
(1,930
|
)
|
|
(10,173
|
)
|
|
(12,103
|
)
|
||||||
Equity in net loss of unconsolidated affiliate
|
—
|
|
|
—
|
|
|
(4,916
|
)
|
|
(4,916
|
)
|
|
—
|
|
|
(4,916
|
)
|
||||||
Other income
|
(19
|
)
|
|
(69
|
)
|
|
(96
|
)
|
|
(184
|
)
|
|
(239
|
)
|
|
(423
|
)
|
||||||
Segment contribution
|
$
|
103,501
|
|
|
$
|
18,654
|
|
|
$
|
2,371
|
|
|
$
|
124,526
|
|
|
|
|
|
|
|
||
Income from continuing operations before income taxes
|
|
|
|
|
|
|
$
|
124,526
|
|
|
$
|
(81,287
|
)
|
|
$
|
43,239
|
|
|
Fiscal Year Ended September 30, 2016
|
||||||||||||||||||||||
|
U.S. Pawn
|
|
Latin America Pawn
|
|
Other
International |
|
Total Segments
|
|
Corporate Items
|
|
Consolidated
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Merchandise sales
|
$
|
348,771
|
|
|
$
|
60,331
|
|
|
$
|
5
|
|
|
$
|
409,107
|
|
|
$
|
—
|
|
|
$
|
409,107
|
|
Jewelry scrapping sales
|
47,810
|
|
|
2,282
|
|
|
21
|
|
|
50,113
|
|
|
—
|
|
|
50,113
|
|
||||||
Pawn service charges
|
229,893
|
|
|
31,907
|
|
|
—
|
|
|
261,800
|
|
|
—
|
|
|
261,800
|
|
||||||
Other revenues
|
331
|
|
|
385
|
|
|
8,769
|
|
|
9,485
|
|
|
—
|
|
|
9,485
|
|
||||||
Total revenues
|
626,805
|
|
|
94,905
|
|
|
8,795
|
|
|
730,505
|
|
|
—
|
|
|
730,505
|
|
||||||
Merchandise cost of goods sold
|
217,268
|
|
|
41,002
|
|
|
1
|
|
|
258,271
|
|
|
—
|
|
|
258,271
|
|
||||||
Jewelry scrapping cost of goods sold
|
40,138
|
|
|
1,885
|
|
|
16
|
|
|
42,039
|
|
|
—
|
|
|
42,039
|
|
||||||
Other cost of revenues
|
—
|
|
|
—
|
|
|
1,965
|
|
|
1,965
|
|
|
—
|
|
|
1,965
|
|
||||||
Net revenues
|
369,399
|
|
|
52,018
|
|
|
6,813
|
|
|
428,230
|
|
|
—
|
|
|
428,230
|
|
||||||
Operating expenses (income):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operations
|
255,321
|
|
|
38,481
|
|
|
7,585
|
|
|
301,387
|
|
|
—
|
|
|
301,387
|
|
||||||
Administrative
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
68,101
|
|
|
68,101
|
|
||||||
Depreciation and amortization
|
12,242
|
|
|
2,965
|
|
|
218
|
|
|
15,425
|
|
|
11,117
|
|
|
26,542
|
|
||||||
Loss on sale or disposal of assets
|
664
|
|
|
169
|
|
|
4
|
|
|
837
|
|
|
269
|
|
|
1,106
|
|
||||||
Restructuring
|
993
|
|
|
543
|
|
|
202
|
|
|
1,738
|
|
|
183
|
|
|
1,921
|
|
||||||
Interest expense
|
125
|
|
|
109
|
|
|
—
|
|
|
234
|
|
|
16,243
|
|
|
16,477
|
|
||||||
Interest income
|
(2
|
)
|
|
(30
|
)
|
|
—
|
|
|
(32
|
)
|
|
(49
|
)
|
|
(81
|
)
|
||||||
Equity in net loss of unconsolidated affiliate
|
—
|
|
|
—
|
|
|
255
|
|
|
255
|
|
|
—
|
|
|
255
|
|
||||||
Impairment of investment
|
—
|
|
|
—
|
|
|
10,957
|
|
|
10,957
|
|
|
—
|
|
|
10,957
|
|
||||||
Other expense (income)
|
—
|
|
|
1,273
|
|
|
2
|
|
|
1,275
|
|
|
(73
|
)
|
|
1,202
|
|
||||||
Segment contribution (loss)
|
$
|
100,056
|
|
|
$
|
8,508
|
|
|
$
|
(12,410
|
)
|
|
$
|
96,154
|
|
|
|
|
|
||||
Income from continuing operations before income taxes
|
|
|
|
|
|
|
$
|
96,154
|
|
|
$
|
(95,791
|
)
|
|
$
|
363
|
|
|
U.S. Pawn
|
|
Latin America Pawn
|
|
Other
International |
|
Corporate
|
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Assets as of September 30, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Pawn loans
|
$
|
154,986
|
|
|
$
|
43,477
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
198,463
|
|
Pawn service charges receivable, net
|
29,961
|
|
|
8,357
|
|
|
—
|
|
|
—
|
|
|
38,318
|
|
|||||
Inventory, net
|
135,154
|
|
|
31,843
|
|
|
—
|
|
|
—
|
|
|
166,997
|
|
|||||
Total assets
|
627,754
|
|
|
188,581
|
|
|
56,776
|
|
|
373,809
|
|
|
1,246,920
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Assets as of September 30, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Pawn loans
|
$
|
148,124
|
|
|
$
|
21,118
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
169,242
|
|
Pawn service charges receivable, net
|
28,258
|
|
|
3,290
|
|
|
—
|
|
|
—
|
|
|
31,548
|
|
|||||
Inventory, net
|
132,549
|
|
|
21,859
|
|
|
3
|
|
|
—
|
|
|
154,411
|
|
|||||
Total assets
|
611,489
|
|
|
82,813
|
|
|
50,462
|
|
|
279,599
|
|
|
1,024,363
|
|
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Long-lived tangible assets:
|
|
|
|
||||
United States
|
$
|
52,310
|
|
|
$
|
47,523
|
|
Latin America
|
20,986
|
|
|
9,960
|
|
||
Canada and other
|
353
|
|
|
476
|
|
||
Total long-lived assets
|
$
|
73,649
|
|
|
$
|
57,959
|
|
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
|
(in thousands)
|
||||||
Gross pawn service charges receivable
|
$
|
49,629
|
|
|
$
|
42,117
|
|
Allowance for uncollectible pawn service charges receivable
|
(11,311
|
)
|
|
(10,569
|
)
|
||
Pawn service charges receivable, net
|
$
|
38,318
|
|
|
$
|
31,548
|
|
|
|
|
|
||||
Gross inventory
|
$
|
176,198
|
|
|
$
|
161,212
|
|
Inventory reserves
|
(9,201
|
)
|
|
(6,801
|
)
|
||
Inventory, net
|
$
|
166,997
|
|
|
$
|
154,411
|
|
|
|
|
|
||||
Prepaid expenses and other
|
$
|
9,402
|
|
|
$
|
9,250
|
|
Accounts receivable and other
|
20,933
|
|
|
19,515
|
|
||
Restricted cash
|
267
|
|
|
—
|
|
||
2019 Convertible Notes Hedges
|
2,552
|
|
|
—
|
|
||
Prepaid expenses and other current assets
|
$
|
33,154
|
|
|
$
|
28,765
|
|
|
|
|
|
||||
Property and equipment, gross
|
$
|
253,022
|
|
|
$
|
224,240
|
|
Accumulated depreciation
|
(179,373
|
)
|
|
(166,281
|
)
|
||
Property and equipment, net
|
$
|
73,649
|
|
|
$
|
57,959
|
|
|
|
|
|
||||
Trade accounts payable
|
$
|
10,500
|
|
|
$
|
13,064
|
|
Accrued payroll
|
6,294
|
|
|
4,860
|
|
||
Bonus accrual
|
12,406
|
|
|
9,010
|
|
||
Other payroll related expenses
|
2,963
|
|
|
3,922
|
|
||
Accrued interest
|
3,835
|
|
|
2,212
|
|
||
Accrued rent and property taxes
|
12,106
|
|
|
11,357
|
|
||
Deferred revenues
|
2,661
|
|
|
2,483
|
|
||
Other accrued expenses
|
4,064
|
|
|
8,310
|
|
||
Income taxes payable
|
1,161
|
|
|
1,465
|
|
||
Unrecognized tax benefits
|
1,810
|
|
|
4,860
|
|
||
Account payable, accrued expenses and other current liabilities
|
$
|
57,800
|
|
|
$
|
61,543
|
|
|
|
|
|
||||
Unrecognized tax benefits, non-current
|
$
|
1,148
|
|
|
$
|
1,758
|
|
Other long-term liabilities
|
5,742
|
|
|
5,297
|
|
||
Other long-term liabilities
|
$
|
6,890
|
|
|
$
|
7,055
|
|
Revenues
|
$
|
45,256
|
|
Consumer loan bad debt
|
(30,081
|
)
|
|
Operations expense
|
(111,984
|
)
|
|
Interest expense, net
|
(16,464
|
)
|
|
Depreciation, amortization and other expenses
|
(12,732
|
)
|
|
Gain on disposition
|
34,237
|
|
|
Loss from discontinued operations before income taxes of Grupo Finmart
|
(91,768
|
)
|
|
Income tax benefit
|
12,896
|
|
|
Loss from discontinued operations, net of tax of operations discontinued prior to the adoption of ASU 2014-08
|
(560
|
)
|
|
Loss from discontinued operations, net of tax
|
$
|
(79,432
|
)
|
|
|
||
Loss from discontinued operations, net of tax of Grupo Finmart
|
$
|
(78,872
|
)
|
Loss from discontinued operations, net of tax of Grupo Finmart attributable to noncontrolling interest
|
6,661
|
|
|
Loss from discontinued operations, net of tax of Grupo Finmart attributable to EZCORP, Inc.
|
$
|
(72,211
|
)
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
Balance at Beginning of Period
|
|
Charged to Expense
|
|
Charged to Revenue
|
|
Deductions
|
|
Balance at End of Period
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Allowance for valuation of inventory:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended September 30, 2018
|
$
|
6,801
|
|
|
$
|
2,400
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,201
|
|
Year Ended September 30, 2017
|
6,143
|
|
|
658
|
|
|
—
|
|
|
—
|
|
|
6,801
|
|
|||||
Year Ended September 30, 2016
|
7,090
|
|
|
—
|
|
|
—
|
|
|
947
|
|
|
6,143
|
|
|||||
Allowance for uncollectible pawn service charges receivable:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended September 30, 2018
|
$
|
10,569
|
|
|
$
|
—
|
|
|
$
|
742
|
|
|
$
|
—
|
|
|
$
|
11,311
|
|
Year Ended September 30, 2017
|
10,396
|
|
|
—
|
|
|
173
|
|
|
—
|
|
|
10,569
|
|
|||||
Year Ended September 30, 2016
|
9,025
|
|
|
—
|
|
|
1,371
|
|
|
—
|
|
|
10,396
|
|
|||||
Allowance for uncollectible consumer loan fees and interest receivable:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended September 30, 2018
|
$
|
283
|
|
|
$
|
—
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
331
|
|
Year Ended September 30, 2017
|
241
|
|
|
—
|
|
|
42
|
|
|
—
|
|
|
283
|
|
|||||
Year Ended September 30, 2016
|
12,045
|
|
|
—
|
|
|
—
|
|
|
11,804
|
|
*
|
241
|
|
|||||
Allowance for valuation of deferred tax assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended September 30, 2018
|
$
|
17,860
|
|
|
$
|
2,394
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20,254
|
|
Year Ended September 30, 2017
|
21,078
|
|
|
—
|
|
|
—
|
|
|
3,218
|
|
|
17,860
|
|
|||||
Year Ended September 30, 2016
|
19,567
|
|
|
1,511
|
|
|
—
|
|
|
—
|
|
|
21,078
|
|
*
|
Includes
$9.2 million
in allowance that was deconsolidated as a result of the disposition of Grupo Finmart as discussed above.
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
Year Ended September 30, 2018
|
|
|
|
|
|
|
|
||||||||
Total revenues
|
$
|
204,508
|
|
|
$
|
202,734
|
|
|
$
|
199,942
|
|
|
$
|
206,331
|
|
Net revenues
|
122,427
|
|
|
120,593
|
|
|
115,072
|
|
|
124,818
|
|
||||
Income from continuing operations, net of tax
|
12,355
|
|
|
11,939
|
|
|
14,183
|
|
|
450
|
|
||||
(Loss) income from discontinued operations, net of tax
|
(222
|
)
|
|
(500
|
)
|
|
91
|
|
|
(225
|
)
|
||||
Net income
|
12,133
|
|
|
11,439
|
|
|
14,274
|
|
|
225
|
|
||||
Net loss attributable to noncontrolling interest
|
(615
|
)
|
|
(374
|
)
|
|
(359
|
)
|
|
360
|
|
||||
Net income attributable to EZCORP, Inc.
|
$
|
12,748
|
|
|
$
|
11,813
|
|
|
$
|
14,633
|
|
|
$
|
(135
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share attributable to EZCORP, Inc.:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.24
|
|
|
$
|
0.23
|
|
|
$
|
0.27
|
|
|
$
|
—
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
||||
Basic earnings per share
|
$
|
0.24
|
|
|
$
|
0.22
|
|
|
$
|
0.27
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share attributable to EZCORP, Inc.:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.23
|
|
|
$
|
0.21
|
|
|
$
|
0.25
|
|
|
$
|
—
|
|
Discontinued operations
|
—
|
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
||||
Diluted earnings per share
|
$
|
0.23
|
|
|
$
|
0.20
|
|
|
$
|
0.25
|
|
|
$
|
—
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
Year Ended September 30, 2017
|
|
|
|
|
|
|
|
||||||||
Total revenues
|
$
|
192,624
|
|
|
$
|
189,628
|
|
|
$
|
183,633
|
|
|
$
|
182,069
|
|
Net revenues
|
111,965
|
|
|
109,897
|
|
|
105,555
|
|
|
108,093
|
|
||||
Income from continuing operations, net of tax
|
8,266
|
|
|
8,231
|
|
|
5,467
|
|
|
10,069
|
|
||||
Income (loss) from discontinued operations, net of tax
|
(1,228
|
)
|
|
(375
|
)
|
|
(265
|
)
|
|
43
|
|
||||
Net income
|
7,038
|
|
|
7,856
|
|
|
5,202
|
|
|
10,112
|
|
||||
Net loss attributable to noncontrolling interest
|
(127
|
)
|
|
(167
|
)
|
|
(58
|
)
|
|
(1,298
|
)
|
||||
Net income attributable to EZCORP, Inc.
|
$
|
7,165
|
|
|
$
|
8,023
|
|
|
$
|
5,260
|
|
|
$
|
11,410
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share attributable to EZCORP, Inc.:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.15
|
|
|
$
|
0.15
|
|
|
$
|
0.10
|
|
|
$
|
0.21
|
|
Discontinued operations
|
(0.02
|
)
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
||||
Basic earnings per share
|
$
|
0.13
|
|
|
$
|
0.14
|
|
|
$
|
0.10
|
|
|
$
|
0.21
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share attributable to EZCORP, Inc.:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.15
|
|
|
$
|
0.15
|
|
|
$
|
0.10
|
|
|
$
|
0.21
|
|
Discontinued operations
|
(0.02
|
)
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
||||
Diluted earnings per share
|
$
|
0.13
|
|
|
$
|
0.14
|
|
|
$
|
0.10
|
|
|
$
|
0.21
|
|
•
|
Judgments in decision-making can be faulty, and control and process breakdowns can occur because of simple errors or mistakes.
|
•
|
Controls can be circumvented by individuals, acting alone or in collusion with others, or by management override.
|
•
|
The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
|
•
|
Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with associated policies or procedures.
|
•
|
The design of a control system must reflect the fact that resources are constrained, and the benefits of controls must be considered relative to their costs.
|
Name (1)
|
|
Age
|
|
Committees
|
|
|
|
|
|
Matthew W. Appel
|
|
62
|
|
Audit (Chair), Compensation, Nominating (Chair)
|
Santiago Creel Miranda
|
|
64
|
|
Compensation
|
Peter Cumins
|
|
67
|
|
—
|
Lachlan P. Given (Executive Chairman)
|
|
42
|
|
Compensation
|
Stuart I. Grimshaw
|
|
57
|
|
—
|
Pablo Lagos Espinosa
|
|
63
|
|
Audit, Compensation (Chair), Nominating
|
Joseph L. Rotunda
|
|
71
|
|
—
|
(1)
|
Thomas C. Roberts served as a member of the Board of Directors during all of fiscal 2018 and retired from the Board effective October 23, 2018. Mr. Roberts was a member of the Audit Committee and the Compensation Committee.
|
•
|
Leadership Experience
— Our directors should demonstrate extraordinary leadership qualities. Strong leaders bring vision, strategic agility, diverse and global perspectives and broad business insight to the company. They demonstrate practical management experience, skills for managing change and deep knowledge of industries, geographies and risk management strategies relevant to our business. They have experience in identifying and developing the current and future leaders of the company.
|
•
|
Finance Experience —
We believe that all directors should possess an understanding of finance and related reporting processes.
|
•
|
Strategically Relevant Experience —
Our directors should have business experience that is relevant to our strategic goals and objectives, including geographical and product expansion. We value experience in our high priority growth areas, including new or expanding geographies or customer segments and existing and new technologies; understanding of our business environments; and experience with, exposure to or reputation among a broad subset of our customer base.
|
•
|
Government Experience
— Our business is subject to a variety of legislative and regulatory risks. Accordingly, we value experience in the legislative, judicial or regulatory branches of government or government relations.
|
•
|
Matthew W. Appel
— Mr. Appel joined EZCORP as a director in January 2015 and is Chair of the Audit Committee, a member of the Compensation Committee and Chair of the Nominating Committee. Mr. Appel spent 37 years in finance, administration and operations roles with a variety of companies, most recently Zale Corporation, an NYSE listed jewelry retailer, where he served as Chief Financial Officer from May 2009 to May 2011 and Chief Administrative Officer from May 2011 to July 2014 and co-led the successful turnaround of the company. Prior to joining Zale, Mr. Appel was Chief Financial Officer of EXL Service Holdings, Inc., a NASDAQ listed business process solutions company (February 2007 to May 2009); spent four years (February 2003 to February 2007) at Electronic Data Systems Corporation, serving as Vice President, Finance and Administration BPO and Vice President, BPO Management; and held a variety of finance and operations roles from 1984 to 2003 at Tenneco Inc., Affiliated Computer Services, Inc. and PricewaterhouseCoopers. Mr. Appel began his professional career with Arthur Andersen & Company, working there from 1977 to 1984. Mr. Appel received an MBA in Accounting from the Rutgers University Graduate School of Business in 1977 and a Business
|
•
|
Santiago Creel Miranda
— Mr. Creel joined EZCORP as a director in January 2014 and is a member of the Compensation Committee. Mr. Creel is a former Senator of Mexico, having served from 2006 to 2012. During his term, he acted as Speaker of the Senate and Chairman of the Senate's Political Coordination Committee. Prior to being elected to the Senate, Mr. Creel served as Secretary of Governance in President Vicente Fox's administration from 2000 to 2005 and as a Federal Deputy (Congressman) in the 57th Congress, where he was Vice Speaker of the Chamber of Deputies and chaired the Government and Constitutional Issues Committee. Mr. Creel practiced law with the firm of Noriega y Escobedo in Mexico City for almost 20 years, and has been a legal consultant to many companies, both domestic and foreign, as well as to international organizations and to the Mexican government. Mr. Creel was a member of the governing body of Pacto por México, which sponsors an extensive agenda of political, economic and structural changes in Mexico.
|
•
|
Peter Cumins
— Mr. Cumins joined EZCORP as a director in July 2014. He is the Executive Deputy Chairman, and serves on the board of directors, of Cash Converters International Limited (ASX: CCV), a public company headquartered in Perth, Western Australia. Cash Converters International owns and franchises retail and financial services stores in 21 countries. EZCORP owns
34.75%
of the outstanding ordinary shares of Cash Converters International. Mr. Cumins joined Cash Converters International in August 1990 as Finance and Administration Manager, became General Manager in March 1992 and served as Managing Director from April 1995 to January 2017, when he became Executive Deputy Chairman. During his tenure as Managing Director, Mr. Cumins oversaw the major growth in the number of company-owned and franchised locations in Australia, as well as the international development of the Cash Converters International franchise system. Mr. Cumins is a qualified accountant, and his experience in the management of large organizations has included senior executive positions in the government health sector, specifically with the Fremantle Hospital Group, where he was Finance and Human Resources Manager.
|
•
|
Lachlan P. Given
— Mr. Given was appointed to the Board of Directors as Non-Executive Chairman in July 2014, became Executive Vice Chairman in August 2014, Executive Chairman in February 2015. Mr. Given serves on the Compensation Committee. He is the sole beneficial owner of LPG Limited (HK), a business and financial advisory firm, and prior to assuming the role of Executive Vice Chairman of EZCORP, provided international financial and advisory services to a number of companies, including EZCORP from October 2012 to June 2014. Since 2004, Mr. Given has also served as a consultant and advisor to Madison Park LLC, which has, in the past, provided certain advisory services to the Company. Madison Park is wholly owned by Phillip E. Cohen, who is the beneficial owner of all of our Class B Voting Common Stock. Mr. Given is also a director of The Farm Journal Corporation, a 134-year old pre-eminent U.S. agricultural media company; Senetas Corporation Limited (ASX: SEN), a developer and manufacturer of certified, defense-grade encryption solutions; CANSTAR Pty Ltd, an Australian financial services ratings and research firm; and TAB Products Co. LLC, a leading North American records management company. Mr. Given began his career working in the investment banking and equity capital markets divisions of Merrill Lynch in Hong Kong and Sydney, Australia, where he specialized in the origination and execution of a variety of M&A, equity, equity-linked and fixed income transactions. Mr. Given also serves on the board of directors of Cash Converters International Limited.
|
•
|
Stuart I. Grimshaw
— Mr. Grimshaw joined EZCORP in November 2014 as Executive Chairman and a member of the Board of Directors. He became Chief Executive Officer in February 2015. Prior to joining EZCORP, he was Managing Director and Chief Executive Officer of Bank of Queensland Limited (ASX: BOQ), a consumer banking and financial services institution with branches in every Australian state and territory. During his 30-year career in financial services,
|
•
|
Pablo Lagos Espinosa
— Mr. Lagos joined EZCORP as a director in October 2010. He is Chair of the Compensation Committee, a member of the Audit Committee and a member of the Nominating Committee. Mr. Lagos served as President and Chief Executive Officer of Pepsi Bottling Group Mexico from 2006 to 2008 and as its Chief Operating Officer from 2003 to 2006. He previously held various executive management positions with Pepsi Bottling Group, PepsiCo Inc., Unilever Mexico and PepsiCola International, Inc., concentrating exclusively in Latin America. Since his retirement in December 2008, Mr. Lagos has been an investor and consultant in various private business ventures mainly in real estate development and senior living residential services, and has served as a keynote speaker on organizational leadership and management. He currently serves as Chairman of the Board and Executive President for the Mexican subsidiary of Areas, a Spanish global organization dedicated to restaurant and retailing operations in key public transportation hubs, and as Chairman of the board of Casa del Parque, a privately held enterprise focused on developing senior living residences in Mexico. He is also a member of the Mexican Advisory Board for Niagara Waters, a leading manufacturer of bottled water in the U.S. and Mexico.
|
•
|
Joseph L. Rotunda
— Mr. Rotunda currently serves as Chief Operating Officer, Global Pawn since July 2018, having originally been appointed Chief Operating Officer in October 2016. Mr. Rotunda has a relationship with the Company that spans almost 20 years. Mr. Rotunda joined EZCORP as President and Chief Operating Officer and a director in February 2000 and was promoted to Chief Executive Officer in August 2000. He retired from that position, and as a member of the Board of Directors, in October 2010 and became a consultant to the Company pursuant to a five-year consulting agreement. That agreement was mutually terminated in November 2013. Mr. Rotunda rejoined the Board of Directors in July 2014 and assumed an executive role in May 2015 when he was appointed President, North American Pawn. Prior to joining EZCORP in 2000, Mr. Rotunda was the Chief Operating Officer of G&K Services, Inc. (1998 to 2000) and held several executive positions, including Executive Vice President and Chief Operating Officer, with Rent-A-Center, Inc. (1991 to 1998). Mr. Rotunda served as a director of EasyHome Ltd. of Toronto, Canada from 2000 until 2010 and as a member of the board of directors of eCommission Financial Services, Inc., headquartered in Austin, Texas, until its sale in 2017.
|
Name
|
|
Age
|
|
Title
|
|
|
|
|
|
Stuart I. Grimshaw
|
|
57
|
|
Chief Executive Officer
|
Lachlan P. Given
|
|
42
|
|
Executive Chairman
|
Scott Alomes
|
|
59
|
|
Chief Human Resources Officer and New Ventures
|
Daniel M. Chism
|
|
50
|
|
Chief Financial Officer
|
Mark DeBenedictus
|
|
57
|
|
Chief Customer Experience Officer
|
William Eric Fosse
|
|
54
|
|
President, U.S. Pawn
|
Francisco J. Kuthy Saenger
|
|
53
|
|
General Manager, Empeño Fácil
|
Joseph L. Rotunda
|
|
71
|
|
Chief Operating Officer, Global Pawn
|
Jacob Wedin
|
|
47
|
|
Chief Business Development Officer
|
Thomas H. Welch, Jr.
|
|
63
|
|
Chief Legal Officer and Secretary
|
•
|
A majority of the directors must be independent (Rule 5605(b)(1));
|
•
|
The audit committee must have a least three members, each of whom must be independent (Rule 5605(c)(2));
|
•
|
Executive officer compensation must be determined, or recommended to the board of directors for determination, by either (1) a majority of the independent directors or (2) a compensation committee comprised solely of independent directors (Rule 5605(d)); and
|
•
|
Director nominations must be selected, or recommended for the board’s selection, by either (1) a majority of the independent directors or (2) a nominations committee comprised solely of independent directors (Rule 5605(e)).
|
•
|
Audit Committee
— The Audit Committee assists the Board in fulfilling its responsibility to provide oversight with respect to our financial statements and reports and other disclosures provided to stockholders, the system of internal controls, the audit process and legal and ethical compliance. Its primary duties include reviewing the scope and adequacy of our internal and financial controls and procedures; reviewing the scope and results of the audit plans of our independent and internal auditors; reviewing the objectivity, effectiveness and resources of the internal audit function; appraising our financial reporting activities and the accounting standards and principles followed; and reviewing and approving ethics and compliance policies. The Audit Committee also selects, engages, compensates and oversees our independent auditor and pre-approves all services to be performed by the independent auditing firm.
|
•
|
Compensation Committee
— The Compensation Committee reviews and approves, on behalf of the Board, the amounts and types of compensation to be paid to our executive officers; reviews and recommends to the full Board the amount and type of compensation to be paid to our non-employee directors; reviews and approves, on behalf of the Board, all bonus and equity compensation to be paid to our other team members; and administers our stock compensation plans. Since September 2014, pursuant to the Nasdaq Controlled Company exemption described above, Mr. Given, our Executive Chairman and a non-independent director, has served on the Compensation Committee. See “Part III, Item 11
|
•
|
Nominating Committee
— In November 2018, the Board of Directors formed and commissioned the Nominating Committee as a standing committee of the Board. The Nominating Committee assists the Board with respect to the selection and nomination of candidates for election or appointment to the Board, including making recommendations to the Board regarding the size and composition of the Board and its committees; recommending to the Board the qualifications needed or required of Board members; identifying and evaluating qualified individuals to become Board members; making recommendations to the full Board regarding the nomination of appropriate candidates; and assessing and monitoring each continuing and prospective director’s independence and qualification to serve on the Board and its committees. The Nominating Committee is is comprised entirely of directors who satisfy the standards of independence described under “Part III, Item 13 — Certain Relationships and Related Transactions, and Director Independence — Director Independence.”
|
•
|
Reported financial results:
|
•
|
The Company’s reported net income for fiscal 2018 was $39.1 million, improving from net income of $31.9 million in fiscal 2017. This resulted from an 11% increase in net revenue, combined with prudent management of both operating and administrative expenses.
|
•
|
EBITDA for fiscal 2018 was $93.4 million, a significant improvement from fiscal 2017. This performance is attributable to continued improvement in our core pawn businesses in the U.S. and Mexico in addition to acquisitions.
|
•
|
We ended the year with $286.0 million in cash and cash equivalents, an increase of 74% versus the same time last year.
|
•
|
In October 2017, we completed the GPMX acquisition, our largest pawn acquisition to date in terms of store count, expanding our store base into Latin American countries outside of Mexico and providing attractive opportunities for further growth and expansion.
|
•
|
In three separate transactions (one in December 2017 and two in June 2018), we acquired 84 stores in Mexico, providing immediate accretion to earnings and a platform for further growth and expansion in Mexico.
|
•
|
During the year, we collected $32.4 million in principal payments from AlphaCredit related to our sale of Grupo Finmart.
|
•
|
In May 2018, we completed a $172.5 million offering of convertible notes, further strengthening our balance sheet and liquidity and locking in an attractive fixed interest rate for a seven-year term.
|
What We Do
|
What We Don’t Do
|
||
|
|
|
|
þ
|
Heavy emphasis on performance-based variable pay
|
ý
|
Generally no single trigger change-in-control payments
|
þ
|
100% of equity incentive grants are performance-based
|
ý
|
No significant perquisites
|
þ
|
Stock retention requirements for executives and directors
|
ý
|
No hedging or pledging of Company stock
|
þ
|
Annual risk assessments
|
|
|
þ
|
Independent compensation consultant
|
|
|
•
|
Base salaries
— Determined that base salaries for the executive officers would generally be held flat for fiscal 2018 compared to fiscal 2017.
|
•
|
Annual incentive bonuses
— At the beginning of the year, approved a short-term incentive (STI) bonus program that established challenging business performance goals, including consolidated EBITDA of $95.6 million, a 16% increase over the reported EBITDA for fiscal 2017. At the end of the year, determined that consolidated EBITDA for fiscal 2018 (taking into account certain limited adjustments) was $97.3 million, and on that basis, approved the corporate-level STI bonus payout at
105%
of target and business unit payouts of 104% for U.S. Pawn, 112% for Empeño Fácil, 150% for GPMX and 82% for CASHMAX (based on the EBITDA performance of each business unit).
|
•
|
Long-term incentives
— Approved long-term incentive awards that are 100% subject to performance-based vesting, contingent on the achievement of sustained earnings growth (measured by the annual growth rate in EBITDA). Awards vest based on performance measured at the end of the performance periods (generally, three years).
|
•
|
Pay for performance
— We expect diligent effort, unwavering commitment and hard work from our executives, and our compensation plans should recognize and reward superior results that generate significant shareholder value. Actual realized compensation should reflect Company and individual performance against specific and quantifiable objectives. Executives should be compensated based on their ability to achieve key operational, financial and strategic results. Compensation earned should parallel our sustained growth in terms of profitability and shareholder value.
|
•
|
Attract and retain high performers
— We want to build and maintain an organization that achieves consistently high results. Therefore, we strive to pay at levels that will attract and retain high quality executives capable of performing at the highest levels and willing to be accountable for the achievement of results. In line with our philosophy of paying well for strong performance, a majority of executive compensation is in the form of incentives that are at risk, but offer significantly higher rewards for the achievement of outstanding results.
|
•
|
Align long-term interests of our shareholders and executives
— Executives should be compensated through compensation components (base salaries, short- and long-term incentives) designed to drive sustained business performance, build an internal culture of ownership and create long-term value for our shareholders.
|
Principle and Goal
|
How Accomplished
|
|
|
Pay for performance —
Provide payouts that are closely aligned with the actual financial results of the Company.
|
•
Total compensation opportunities will include a significant portion of performance-based incentives tied to achievement of specific financial or strategic objectives and the growth in stockholder value.
•
Incentive objectives will be specific, quantifiable and measurable, but may also include goals that require an element of subjective evaluation.
•
Long-term incentives will have both retention and performance requirements and therefore will vest over time so long as specific objectives are achieved.
|
Attract and retain high performers
—
Pay at levels that will help us attract and retain highly qualified individuals capable of leading us to achieve our business objectives.
|
•
Total compensation is designed to provide base salaries and short- and long-term incentive opportunities that will result in highly competitive pay levels when performance objectives are achieved, as well as above-market opportunities when outstanding results are achieved.
•
Incentive plans provide clear and measurable objectives for top performers to achieve high-level compensation.
|
Align long-term interests of shareholders and executives —
Reinforce a culture of ownership and long-term commitment to shareholder value creation.
|
•
Executives are required to be stockholders and own a minimum level of Company stock throughout their employment.
•
The vesting of equity incentive awards is tied directly to continued multi-year service (retention) and the achievement of specific long-term financial results.
|
Compensation Component
|
Description
|
Attract and Retain
|
Pay for Performance
|
Shareholder Alignment
|
Long-term Commitment
|
|
|
|
|
|
|
Base Salary
|
•
A market-competitive salary is an essential factor in attracting and retaining qualified personnel.
|
ü
|
|
|
|
Annual Incentives
|
•
Annual cash bonus opportunity that is tied to an assessment of annual corporate and business unit financial performance, as well as individual contribution.
|
ü
|
ü
|
ü
|
|
Long-term Incentives
|
•
Equity incentive grants, including performance-vested restricted stock grants tied to achievement of consistent multi-year growth in earnings and stockholder value.
|
ü
|
ü
|
ü
|
ü
|
•
Annual Supplemental Executive Retirement Plan contributions that vest over the subsequent three years from the date of contribution.
|
ü
|
|
|
ü
|
Peer Company
|
Stock Symbol
|
Primary Business
|
|
|
|
Aaron’s Inc.
|
AAN
|
Specialty Retail
|
Build-A-Bear Workshop, Inc.
|
BBW
|
Specialty Retail
|
Cardtronics Plc
|
CATM
|
Consumer Finance — IT Services
|
Christopher & Banks Corporation
|
CBK
|
Specialty Retail
|
Citi Trends, Inc.
|
CTRN
|
Specialty Retail
|
Credit Acceptance Corporation
|
CACC
|
Consumer Finance
|
First Cash, Inc.
|
FCFS
|
Consumer Finance — Pawn and Payday Lending
|
Francesca’s Holdings Corporation
|
FRAN
|
Specialty Retail
|
Green Dot Corporation
|
GDOT
|
Consumer Finance — Debit Cards
|
H&R Block, Inc.
|
HRB
|
Diversified Consumer Services
|
MoneyGram International, Inc.
|
MGI
|
Consumer Finance — IT Services
|
OneMain Holdings, Inc.
|
OMF
|
Consumer Finance
|
Rent-A-Center, Inc.
|
RCII
|
Specialty Retail
|
Total System Services, Inc.
|
TSS
|
Consumer Finance — IT Services
|
WEX Inc.
|
WEX
|
Consumer Finance — IT Services
|
World Acceptance Corporation
|
WRLD
|
Consumer Finance — Small Loans
|
Zumiez Inc.
|
ZUMZ
|
Specialty Retail
|
Named Executive Officer
|
Fiscal 2018 Base Salary
|
|
Fiscal 2017 Base Salary
|
|
Increase
|
|||||
|
|
|
|
|
|
|
||||
Mr. Grimshaw
|
$
|
1,000,000
|
|
|
$
|
1,000,000
|
|
|
—%
|
|
Mr. Chism
|
450,000
|
|
|
450,000
|
|
|
—%
|
|||
Mr. Given
|
600,000
|
|
|
600,000
|
|
|
—%
|
|||
Mr. Rotunda
|
675,000
|
|
|
675,000
|
|
|
—%
|
|||
Mr. Welch
|
410,000
|
|
|
410,000
|
|
|
—%
|
Named Executive Officer
|
2018 Salary
|
Target Amount
|
Target Opportunity
|
Business Performance Modifier (a)
|
Individual Performance Modifier (a)
|
Actual Award Earned
|
|||||||
|
|
|
|
|
|
|
|||||||
Mr. Grimshaw
|
$
|
1,000,000
|
|
250%
|
$
|
2,500,000
|
|
105%
|
N/A
|
$
|
2,625,000
|
|
|
Mr. Chism
|
450,000
|
|
80%
|
360,000
|
|
105%
|
60%
|
302,400
|
|
||||
Mr. Given
|
600,000
|
|
125%
|
750,000
|
|
105%
|
N/A
|
787,500
|
|
||||
Mr. Rotunda
|
675,000
|
|
150%
|
1,012,500
|
|
105%
|
100%
|
1,063,125
|
|
||||
Mr. Welch
|
410,000
|
|
75%
|
307,500
|
|
105%
|
70%
|
274,444
|
|
(a)
|
For Mr. Grimshaw and Mr. Given, 100% of their Target Opportunity is subject to the Business Performance Modifier. For each of the other Named Executive Officers, 50% of the Target Opportunity is subject to reduction based on the Individual Performance Modifier and then the Business Performance Modifier is applied to the resulting Target Opportunity. The Individual Performance Modifiers for Mr. Chism, Mr. Rotunda and Mr. Welch were recommended by the Chief Executive Officer and approved by the Compensation Committee. The Chief Executive Officer’s recommendations were based on his subjective evaluation of each executive's performance during the year relative to the Company's performance as a whole, with the expectation that only extraordinary performance would merit a 100% Individual Performance Modifier. Given these standards, the Chief Executive Officer recommended, and the Compensation Committee approved, the Individual Performance Modifiers noted above.
|
|
Approved Temporary Housing Allowance
|
Amount of Allowance Received in Fiscal 2018 (a)
|
|||||
Named Executive Officer
|
Amount (per month)
|
Expiration Date
|
|||||
|
|
|
|
||||
Mr. Grimshaw
|
$
|
25,000
|
|
November 30, 2017
|
$
|
31,378
|
|
Mr. Given
|
10,000
|
|
March 31, 2018
|
62,017
|
|
(a)
|
These amounts are included in the “All Other Compensation” column of the Summary Compensation table below.
|
•
|
Annual incentive compensation tied to achievement of profitable Company or business unit performance (as measured by consolidated and/or business unit EBITDA); and
|
•
|
Meaningful long-term equity incentive opportunities that are 100% performance-based and provide an incentive to deliver long-term growth in stockholder value as a result of sustained earnings growth, prudent balance sheet management or other measures.
|
•
|
Each of our executive officers will receive salary continuation for one year if his or her employment is terminated by the Company without cause.
|
•
|
Generally, restricted stock awards, including those granted to the executive officers, provide for accelerated vesting of some or all of the unvested shares or units in the event of the holder's death or disability.
|
|
Matthew W. Appel
Santiago Creel Miranda
Lachlan P. Given
Pablo Lagos Espinosa (Chair)
|
|
Name and Principal Position
|
Fiscal Year
|
|
Salary
(1)
|
|
Bonus
|
|
Stock Awards
(2)
|
|
Non-Equity Incentive Plan Compensation (3)
|
|
All Other Compensation (4)
|
|
Total
|
||||||||||||
|
|
|
|
|
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Stuart I. Grimshaw
(5)
Chief Executive Officer |
2018
|
|
$
|
1,000,000
|
|
|
$
|
—
|
|
|
$
|
3,702,943
|
|
|
$
|
2,625,000
|
|
|
$
|
175,811
|
|
|
$
|
7,503,754
|
|
2017
|
|
1,000,000
|
|
|
—
|
|
|
2,603,981
|
|
|
1,925,000
|
|
|
315,929
|
|
|
5,844,910
|
|
|||||||
2016
|
|
1,000,000
|
|
|
—
|
|
|
1,804,343
|
|
|
4,210,000
|
|
|
504,471
|
|
|
7,518,814
|
|
|||||||
Daniel M. Chism
Chief Financial Officer
|
2018
|
|
450,000
|
|
|
—
|
|
|
461,838
|
|
|
302,400
|
|
|
80,587
|
|
|
1,294,825
|
|
||||||
2017
|
|
159,231
|
|
|
—
|
|
|
—
|
|
|
85,447
|
|
|
8,574
|
|
|
253,252
|
|
|||||||
2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Lachlan P. Given
(5)
Executive Chairman
|
2018
|
|
600,000
|
|
|
—
|
|
|
1,110,886
|
|
|
787,500
|
|
|
153,588
|
|
|
2,651,974
|
|
||||||
2017
|
|
600,000
|
|
|
—
|
|
|
781,190
|
|
|
577,500
|
|
|
198,213
|
|
|
2,156,903
|
|
|||||||
2016
|
|
600,000
|
|
|
—
|
|
|
541,305
|
|
|
1,125,000
|
|
|
190,126
|
|
|
2,456,431
|
|
|||||||
Joseph L. Rotunda
Chief Operating Officer
|
2018
|
|
675,000
|
|
|
—
|
|
|
864,367
|
|
|
1,063,125
|
|
|
90,399
|
|
|
2,692,891
|
|
||||||
2017
|
|
668,750
|
|
|
—
|
|
|
585,898
|
|
|
779,625
|
|
|
81,924
|
|
|
2,116,197
|
|
|||||||
2016
|
|
668,750
|
|
|
—
|
|
|
263,857
|
|
|
1,518,750
|
|
|
80,726
|
|
|
2,532,083
|
|
|||||||
Thomas H. Welch, Jr.
Chief Legal Officer and Secretary
|
2018
|
|
410,000
|
|
|
—
|
|
|
548,516
|
|
|
274,444
|
|
|
77,664
|
|
|
1,310,624
|
|
||||||
2017
|
|
410,000
|
|
|
—
|
|
|
355,882
|
|
|
213,098
|
|
|
67,725
|
|
|
1,046,705
|
|
|||||||
2016
|
|
410,000
|
|
|
—
|
|
|
196,695
|
|
|
403,594
|
|
|
63,146
|
|
|
1,073,435
|
|
(1)
|
The amounts shown under “Salary” reflect the gross amounts of base salary paid to each of the Named Executive Officers during the fiscal years so noted. The fiscal 2017 amounts for Mr. Chism reflect the number of days during the fiscal year that he was employed by the Company.
|
(2)
|
Amounts represent the aggregate grant date fair value of restricted stock or restricted stock unit awards, computed in accordance with FASB ASC 718-10-25. See
Note 9
of Notes to Consolidated Financial Statements included in “Part II, Item 8 — Financial Statements and Supplementary Data.” The actual value realized by the Named Executive Officer with respect to stock awards will depend on whether the award vests and, if it vests, the market value of our stock on the date the stock is sold.
|
(3)
|
Amounts represent the bonuses paid pursuant to the Short-Term Incentive Compensation Plan. See “Compensation Discussion and Analysis — Components of Compensation — Annual Incentive Bonuses” above. The fiscal 2016 amount for Mr. Grimshaw also includes $460,000 representing the final special short-term bonus paid to Mr. Grimshaw pursuant to his terms of hire.
|
(4)
|
Amounts include the cost of providing various perquisites and personal benefits (including housing allowances, where applicable), as well as the value of our contributions to the company-sponsored 401(k) plan and Supplemental Executive Retirement Plan. For detail of the amounts shown for each Named Executive Officer, see the table under “Other Benefits and Perquisites — All Other Compensation” below.
|
(5)
|
Mr. Grimshaw and Mr. Given also serve on the board of directors of Cash Converters International Limited, with Mr. Grimshaw serving as non-executive chairman. The director fees paid to them by Cash Converters International Limited for fiscal 2018, fiscal 2017 and fiscal 2016 were as follows: Mr. Grimshaw, $129,329, $129,538 and $124,429, respectively; Mr. Given, $72,272, $81,009 and $71,987, respectively. These amounts are not included in the Summary Compensation Table, as they were paid by Cash Converters International Limited, which is not controlled by EZCORP.
|
|
|
|
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards (1)
|
|
Estimated Future Payouts Under
Equity Incentive Plan Awards (2) |
|
Grant Date Fair Value (3)
|
|||||||||||||||||||
Name
|
Grant Date
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Mr. Grimshaw
|
11/13/2017
|
|
$
|
1,250,000
|
|
|
$
|
2,500,000
|
|
|
$
|
3,750,000
|
|
|
|
|
|
|
|
|
|
|||||
|
11/13/2017
|
|
|
|
|
|
|
|
157,895
|
|
|
315,789
|
|
|
315,789
|
|
|
$
|
3,078,943
|
|
||||||
|
11/13/2017
|
|
|
|
|
|
|
|
32,000
|
|
|
64,000
|
|
|
64,000
|
|
|
$
|
624,000
|
|
||||||
Mr. Chism
|
11/13/2017
|
|
$
|
180,000
|
|
|
$
|
360,000
|
|
|
$
|
540,000
|
|
|
|
|
|
|
|
|
|
|||||
|
11/13/2017
|
|
|
|
|
|
|
|
23,684
|
|
|
47,368
|
|
|
47,368
|
|
|
$
|
461,838
|
|
||||||
Mr. Given
|
11/13/2017
|
|
$
|
375,000
|
|
|
$
|
750,000
|
|
|
$
|
1,125,000
|
|
|
|
|
|
|
|
|
|
|||||
|
11/13/2017
|
|
|
|
|
|
|
|
47,369
|
|
|
94,737
|
|
|
94,737
|
|
|
$
|
923,686
|
|
||||||
|
11/13/2017
|
|
|
|
|
|
|
|
9,600
|
|
|
19,200
|
|
|
19,200
|
|
|
$
|
187,200
|
|
||||||
Mr. Rotunda
|
11/13/2017
|
|
$
|
506,250
|
|
|
$
|
1,012,500
|
|
|
$
|
1,518,750
|
|
|
|
|
|
|
|
|
|
|||||
|
11/13/2017
|
|
|
|
|
|
|
|
44,027
|
|
|
71,053
|
|
|
71,053
|
|
|
$
|
692,767
|
|
||||||
|
11/13/2017
|
|
|
|
|
|
|
|
8,800
|
|
|
17,600
|
|
|
17,600
|
|
|
$
|
171,600
|
|
||||||
Mr. Welch
|
11/13/2017
|
|
$
|
153,750
|
|
|
$
|
307,500
|
|
|
$
|
461,250
|
|
|
|
|
|
|
|
|
|
|||||
|
11/13/2017
|
|
|
|
|
|
|
|
28,079
|
|
|
43,158
|
|
|
43,158
|
|
|
$
|
420,791
|
|
||||||
|
11/13/2017
|
|
|
|
|
|
|
|
6,550
|
|
|
13,100
|
|
|
13,100
|
|
|
$
|
127,725
|
|
(1)
|
These amounts represent the potential payouts under the fiscal 2018 Short-Term Incentive Compensation Plan. See “Compensation Discussion and Analysis — Components of Compensation — Annual Incentive Bonuses” above. The “Target” amount is the amount that will be paid if the specified performance goals are achieved at the target level (although the Compensation Committee may reduce any award if it chooses to do so). The “Threshold” amount reflects the amount that would be paid if the minimum performance goals are achieved, while the “Maximum” amount represents the maximum amount that will be paid if the maximum performance goals are achieved or exceeded. See the “Non-Equity Incentive Plan Compensation” column in the Summary Compensation Table above for the amount of the actual payout for each of the Named Executive Officers.
|
(2)
|
These amounts represent the fiscal 2018 awards under the Long-Term Incentive Plan. See “Compensation Discussion and Analysis — Components of Compensation — Long-Term Incentives” above. The “Target” amount is the number of units that will vest if the specified performance goals are achieved at the target level. The “Threshold” amount reflects the number of units that will vest if the minimum performance goals are achieved for the EBITDA growth targets. No more than 100% of the Target number of units will vest; therefore, the “Maximum” amount is the same as the Target amount. Each unit represents the right to receive one share of Class A Common Stock upon vesting.
|
(3)
|
Represents the estimated grant date fair value of fiscal 2018 equity awards, assuming payout at “Target” level. This is the estimated amount of aggregate compensation cost we expect to recognize over the performance period, determined as of the grant date. See “Compensation Discussion and Analysis — Components of Compensation — Long-Term Incentives” above.
|
|
|
|
Stock Awards
|
|||||||
Name
|
Award Date
|
|
Number of Shares or Units of Stock That Have Not Vested
|
|
|
|
Market Value of Shares or Units of Stock That Have Not Vested (1)
|
|||
|
|
|
|
|
|
|
|
|||
Mr. Grimshaw
|
11/13/2017
|
|
64,000
|
|
|
(2)
|
|
$
|
684,800
|
|
11/13/2017
|
|
315,789
|
|
|
(3)
|
|
$
|
3,378,942
|
|
|
11/8/2016
|
|
271,248
|
|
|
(4)
|
|
$
|
2,902,354
|
|
|
3/21/2016
|
|
324,149
|
|
|
(5)
|
|
$
|
3,468,394
|
|
|
11/3/2014
|
|
200,000
|
|
|
(6)
|
|
$
|
2,140,000
|
|
|
Mr. Chism
|
11/13/2017
|
|
47,368
|
|
|
(3)
|
|
$
|
506,838
|
|
Mr. Given
|
11/13/2017
|
|
19,200
|
|
|
(2)
|
|
$
|
205,440
|
|
11/13/2017
|
|
94,737
|
|
|
(3)
|
|
$
|
1,013,686
|
|
|
11/8/2016
|
|
81,374
|
|
|
(4)
|
|
$
|
870,702
|
|
|
3/21/2016
|
|
97,245
|
|
|
(5)
|
|
$
|
1,040,522
|
|
|
10/1/2014
|
|
150,000
|
|
|
(6)
|
|
$
|
1,605,000
|
|
|
Mr. Rotunda (8)
|
11/13/2017
|
|
17,600
|
|
|
(2)
|
|
$
|
188,320
|
|
11/13/2017
|
|
71,053
|
|
|
(3)
|
|
$
|
760,267
|
|
|
11/8/2016
|
|
61,031
|
|
|
(4)
|
|
$
|
653,032
|
|
|
3/21/2016
|
|
89,141
|
|
|
(5)
|
|
$
|
953,809
|
|
|
11/13/2015
|
|
9,880
|
|
|
(7)
|
|
$
|
105,716
|
|
|
Mr. Welch
|
11/13/2017
|
|
13,100
|
|
|
(2)
|
|
$
|
140,170
|
|
11/13/2017
|
|
43,158
|
|
|
(3)
|
|
$
|
461,791
|
|
|
11/8/2016
|
|
37,071
|
|
|
(4)
|
|
$
|
396,660
|
|
|
3/21/2016
|
|
66,451
|
|
|
(5)
|
|
$
|
711,026
|
|
|
10/1/2014
|
|
16,000
|
|
|
(7)
|
|
$
|
171,200
|
|
(1)
|
Market value is based on the closing price of our Class A Common Stock on September 28, 2018, the last market trading day of fiscal 2018 ($10.70).
|
(2)
|
These awards vested on November 12, 2018 when the Compensation Committee certified that the applicable performance objectives had been achieved with regard to the attainment of specified EBITDA growth objectives. See “Compensation Discussion and Analysis — Components of Compensation — Long-Term Incentives” above.
|
(3)
|
These awards are scheduled to vest on September 30, 2020 subject to the attainment of specified EBITDA growth objectives. See “Compensation Discussion and Analysis — Components of Compensation — Long-Term Incentives” above.
|
(4)
|
These awards are scheduled to vest on September 30, 2019 subject to specified performance objectives as follows: vesting of 80% of the awards is subject to the attainment of specified EBITDA growth objectives; and vesting of 20% of the awards is subject to the attainment of specified net debt reduction objectives. See “Compensation Discussion and Analysis — Components of Compensation — Long-Term Incentives” above.
|
(5)
|
80% of these awards vested on November 12, 2018 when the Compensation Committee certified that the applicable performance objectives had been achieved with regard to the attainment of specified EBITDA growth objectives. The remaining 20% of the awards did not vest as the attainment of specified net debt reduction objectives was not achieved. See “Compensation Discussion and Analysis — Components of Compensation — Long-Term Incentives” above.
|
(6)
|
Vesting of these awards is subject to the attainment of specified EBITDA growth objectives. Of these shares, half vested on November 12, 2018 when the Compensation Committee certified that the applicable performance objectives had been achieved and half are scheduled to vest on September 30, 2020.
|
(7)
|
These awards vest through fiscal 2020 in specified amounts if the per-share trading price of our Class A Common Stock achieves specified levels ranging from $15 to $80.
|
(8)
|
Mr. Rotunda’s current and future long-term incentive awards contain a special term providing for the continued vesting (rather than forfeiture) of all unvested awards in accordance with their terms (including corporate-level performance criteria) if Mr. Rotunda voluntarily retires from his executive position with the Company.
|
|
|
Stock Awards
|
||||
Named Executive Officer
|
|
Number of Shares Acquired on Vesting
|
|
Value Realized on Vesting (1)
|
||
|
|
|
|
|
||
Mr. Rotunda
|
|
4,940
|
|
(2)
|
49,400
|
|
Mr. Welch
|
|
8,000
|
|
(2)
|
80,000
|
|
(1)
|
Computed using the fair market value of the stock on the date of vesting.
|
(2)
|
These awards vested on November 15, 2017 (market value, $10.00 per share) and are presented gross, exclusive of net shares withheld to satisfy individual tax withholding obligations.
|
Named Executive Officer
|
Company Contributions in Fiscal 2018 (1)
|
|
Aggregate Earnings in Fiscal 2018 (2)
|
|
Aggregate Withdrawals/Distributions in Fiscal 2018
|
|
Aggregate Forfeitures in Fiscal 2018
|
|
Aggregate Balance at September 30, 2018 (3)
|
||||||||||
|
|
|
|
||||||||||||||||
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Mr. Grimshaw
|
$
|
100,000
|
|
|
$
|
44,885
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
497,750
|
|
Mr. Chism
|
45,000
|
|
|
1,877
|
|
|
—
|
|
|
—
|
|
|
46,877
|
|
|||||
Mr. Given
|
60,000
|
|
|
27,179
|
|
|
—
|
|
|
—
|
|
|
301,962
|
|
|||||
Mr. Rotunda
|
67,500
|
|
|
5,521
|
|
|
—
|
|
|
—
|
|
|
223,018
|
|
|||||
Mr. Welch
|
41,000
|
|
|
46,048
|
|
|
—
|
|
|
—
|
|
|
630,340
|
|
(1)
|
These amounts were included in the Summary Compensation Table above in the column labeled “All Other Compensation.”
|
(2)
|
These amounts were not included in the Summary Compensation Table as the earnings were not in excess of market rates.
|
(3)
|
Of the Aggregate Balance at
September 30, 2018
, the following amounts were previously reported as compensation in the Summary Compensation Tables for prior years: $300,000 for Mr. Grimshaw, $180,000 for Mr. Given and $441,504 for Mr. Welch.
|
Named Executive Officer
|
Year
|
|
Health Care Supplemental Insurance (1)
|
|
Value of Supplemental Life Insurance Premiums (2)
|
|
Company Contributions to Defined Contribution Plans (3)
|
|
Housing Allowance
|
|
Other Benefits (4)
|
|
Total
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Mr. Grimshaw
|
2018
|
|
$
|
20,128
|
|
|
$
|
2,088
|
|
|
$
|
104,750
|
|
|
$
|
31,378
|
|
|
$
|
17,467
|
|
|
$
|
175,811
|
|
|
|
2017
|
|
12,896
|
|
|
1,300
|
|
|
105,019
|
|
|
194,665
|
|
|
2,049
|
|
|
315,929
|
|
|||||||
|
2016
|
|
11,148
|
|
|
1,395
|
|
|
103,975
|
|
|
188,265
|
|
|
199,688
|
|
|
504,471
|
|
|||||||
Mr. Chism
|
2018
|
|
29,483
|
|
|
2,088
|
|
|
49,016
|
|
|
—
|
|
|
—
|
|
|
80,587
|
|
|||||||
|
2017
|
|
7,425
|
|
|
500
|
|
|
649
|
|
|
—
|
|
|
—
|
|
|
8,574
|
|
|||||||
|
2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Mr. Given
|
2018
|
|
29,483
|
|
|
2,088
|
|
|
60,000
|
|
|
62,017
|
|
|
—
|
|
|
153,588
|
|
|||||||
|
2017
|
|
19,305
|
|
|
1,300
|
|
|
60,000
|
|
|
106,473
|
|
|
11,135
|
|
|
198,213
|
|
|||||||
|
2016
|
|
16,656
|
|
|
1,395
|
|
|
60,000
|
|
|
112,075
|
|
|
—
|
|
|
190,126
|
|
|||||||
Mr. Rotunda
|
2018
|
|
20,128
|
|
|
2,088
|
|
|
68,183
|
|
|
—
|
|
|
—
|
|
|
90,399
|
|
|||||||
|
2017
|
|
12,896
|
|
|
845
|
|
|
68,183
|
|
|
—
|
|
|
—
|
|
|
81,924
|
|
|||||||
|
2016
|
|
11,148
|
|
|
1,395
|
|
|
68,183
|
|
|
—
|
|
|
—
|
|
|
80,726
|
|
|||||||
Mr. Welch
|
2018
|
|
29,483
|
|
|
2,088
|
|
|
45,973
|
|
|
—
|
|
|
120
|
|
|
77,664
|
|
|||||||
|
2017
|
|
19,305
|
|
|
1,300
|
|
|
47,000
|
|
|
—
|
|
|
120
|
|
|
67,725
|
|
|||||||
|
2016
|
|
16,656
|
|
|
1,395
|
|
|
44,975
|
|
|
—
|
|
|
120
|
|
|
63,146
|
|
(1)
|
We provide a fully insured supplemental executive medical plan to certain executives, including all of the Named Executive Officers to cover most healthcare costs in excess of amounts covered by our health insurance plans. The amounts shown represent the total premiums paid for the supplemental executive medical plan for each of the Named Executive Officers during each of the years presented. Additionally, in fiscal 2018, from January 1, 2018 through April 30, 2018, the Company carried a fully-insured International Medical Plan for certain executives, including all of the Named Executive Officers, and canceled their participation in the group health plan during that time. The amount shown in 2018 includes these additional premiums paid on behalf of the Named Executive Officers.
|
(2)
|
Represents group life insurance premiums paid on behalf of the Named Executive Officers. The benefit provides life and accidental death and dismemberment coverage for the Named Executive Officers at three times annual salary up to a maximum of $1 million.
|
(3)
|
Includes the fiscal
2018
Company contributions to the 401(k) plan and the Supplemental Executive Retirement Plan.
|
(4)
|
The amounts shown as Other Benefits include the following:
|
•
|
Restricted Stock Award Agreements
— The standard restricted stock award agreement pursuant to which we grant restricted stock or restricted stock units to our team members generally provides that vesting is accelerated in the event of the holder’s death or disability.
|
•
|
General severance benefits
— We currently provide each of our executive officers with one-year salary continuation if his or her employment is terminated by the Company without cause.
|
|
Salary
|
|
Incentive
Bonus
|
|
Healthcare
Payments
|
|
Accelerated Vesting of
Restricted
Stock (1)
|
|
Accelerated Vesting of
SERP Balance
|
|
Other
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Resignation for Good Reason:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mr. Grimshaw
|
$
|
1,000,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mr. Chism
|
450,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Given
|
600,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Rotunda
|
675,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Welch
|
410,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Termination Without Cause:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mr. Grimshaw
|
$
|
1,000,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mr. Chism
|
450,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Given
|
600,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Rotunda
|
675,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Welch
|
410,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Death or Disability:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mr. Grimshaw
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
12,574,490
|
|
|
$
|
497,750
|
|
|
$
|
—
|
|
Mr. Chism
|
—
|
|
|
—
|
|
|
—
|
|
|
506,838
|
|
|
46,877
|
|
|
—
|
|
||||||
Mr. Given
|
—
|
|
|
—
|
|
|
—
|
|
|
4,735,349
|
|
|
301,962
|
|
|
—
|
|
||||||
Mr. Rotunda (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
2,661,144
|
|
|
—
|
|
|
—
|
|
||||||
Mr. Welch (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,880,846
|
|
|
—
|
|
|
—
|
|
(1)
|
Represents the number of shares subject to accelerated vesting (as described above), multiplied by the closing sales price of the Class A Common Stock on September 28, 2018 of $10.70.
|
(2)
|
Mr. Rotunda and Mr. Welch are fully vested in their SERP balances.
|
Director
|
Fees Earned or Paid in Cash (1)
|
|
Restricted Stock Awards (2)
|
|
Total
|
|||||||
|
|
|
|
|
|
|||||||
Matthew W. Appel
|
$
|
112,500
|
|
|
$
|
165,130
|
|
|
$
|
277,630
|
|
|
Santiago Creel Miranda
|
85,000
|
|
|
165,130
|
|
|
250,130
|
|
||||
Peter Cumins
|
80,000
|
|
|
165,130
|
|
|
245,130
|
|
||||
Pablo Lagos Espinosa
|
100,000
|
|
|
165,130
|
|
|
265,130
|
|
||||
Thomas C. Roberts (3)
|
85,000
|
|
|
165,130
|
|
|
250,130
|
|
(1)
|
Amounts shown for Mr. Appel, Mr. Creel, Mr. Lagos and Mr. Roberts include $5,000 each for serving on the special acquisition committee appointed and commissioned by the Board of Directors to review, evaluate and approve the terms of the GPMX acquisition. See “Part III — Item 10 — Directors, Executive Officers and Corporate Governance — Corporate Governance — Meetings and Attendance” above. This special acquisition committee was formed in May 2017 and dissolved as of the completion of the GPMX acquisition in October 2017.
|
(2)
|
Amounts represent the aggregate grant date fair value of restricted stock awards, computed in accordance with FASB ASC 718-10-25. See
Note 9
of Notes to Consolidated Financial Statements included in “Part II, Item 8 — Financial Statements and Supplementary Data.” The actual value realized by the director with respect to stock awards will depend on the market value of our stock on the date the stock is sold.
|
(3)
|
Mr. Roberts retired from his position as a member of our Board of Directors, effective October 23, 2018.
|
Plan Category
|
Number of Securities to
be Issued Upon Exercise
of Outstanding Options
(a) (1)
|
|
Weighted Average
Exercise Price of
Outstanding Options
(b)
|
|
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
Column (a))
(c)
|
||||
|
|
|
|
|
|
||||
Equity compensation plans approved by security holders
|
—
|
|
|
$
|
—
|
|
|
162,659
|
|
Equity compensation plans not approved by security holders
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
—
|
|
|
$
|
—
|
|
|
162,659
|
|
(1)
|
Excludes
3,555,725
shares of restricted stock that were outstanding as of
September 30, 2018
.
|
|
Class A Non-voting
Common Stock |
|
|
|
Class B Voting
Common Stock |
|
|
|||||||||||
Beneficial Owner
|
Number
|
|
|
|
Percent
|
|
|
|
Number
|
|
Percent
|
|
Voting Percent
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
MS Pawn Limited Partnership (a)
MS Pawn Corporation
Phillip Ean Cohen
2500 Bee Cave Road
Bldg One, Suite 200
Rollingwood, Texas 78746
|
2,974,047
|
|
|
(b)
|
|
5.76
|
%
|
|
(b)
|
|
2,970,171
|
|
|
100
|
%
|
|
100
|
%
|
Blackrock, Inc.
55 East 52
nd
Street
New York, New York 10055
|
7,076,848
|
|
|
(d)
|
|
13.71
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Lafitte Capital Management 707 Brazos Street, Suite 310 Austin, Texas 78701
|
5,400,000
|
|
|
(c)
|
|
10.46
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Dimensional Fund Advisors
6300 Bee Cave Road, Building One
Austin, Texas 78746
|
4,313,742
|
|
|
(c)
|
|
8.36
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Rovida Advisory Services, LLC
One Gateway Ctr., #2530
Newark, New Jersey 07102
|
4,000,000
|
|
|
(d)
|
|
7.75
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Cardinal Capital Management, LLC
4 Greenwich Office Park, 3rd Fl.
Greenwich, Connecticut 06831
|
3,896,044
|
|
|
(c)
|
|
7.55
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
The Vanguard Group, Inc.
100 Vanguard Blvd.
Malvern, Pennsylvania 19355
|
3,888,737
|
|
|
(c)
|
|
7.53
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Matthew W. Appel
|
71,350
|
|
|
|
|
*
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Santiago Creel Miranda
|
83,350
|
|
|
|
|
*
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Peter Cumins
|
73,350
|
|
|
|
|
*
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Lachlan P. Given
|
320,932
|
|
|
(e)
|
|
*
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Stuart I. Grimshaw
|
650,799
|
|
|
(f)
|
|
1.26
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Pablo Lagos Espinosa
|
101,050
|
|
|
|
|
*
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Joseph L. Rotunda
|
853,173
|
|
|
(g)
|
|
1.65
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Thomas H. Welch, Jr.
|
127,368
|
|
|
(h)
|
|
*
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Directors and executive officers as a group (15 persons)
|
2,492,969
|
|
|
(i)
|
|
4.83
|
%
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(a)
|
MS Pawn Corporation is the general partner of MS Pawn Limited Partnership and has the sole right to vote its shares of Class B Common Stock and to direct their disposition. Mr. Cohen is the sole stockholder of MS Pawn Corporation.
|
(b)
|
The number of shares and percentage reflect Class A Common Stock, inclusive of Class B Common Stock, shares of which are convertible to Class A Common Stock on a one-to-one basis.
|
(c)
|
As of June 30, 2018 based on Form 13F.
|
(d)
|
As of September 30, 2018 based on Form 13F.
|
(e)
|
Includes 191,445 unvested restricted stock units expected to vest within 60 days, but does not include 75,000 shares of unvested restricted stock or 176,111 unvested restricted stock units (each of which represents the right to receive one share upon vesting).
|
(f)
|
Includes 488,149 unvested restricted stock units expected to vest within 60 days, but does not include 100,000 other shares of unvested restricted stock or 587,037 unvested restricted stock units (each of which represents the right to receive one share upon vesting).
|
(g)
|
Includes 1,865 shares held through the Company’s 401(k) retirement savings plan and 106,741 unvested restricted stock units expected to vest within 60 days, but does not include 9,880 other shares of unvested restricted stock or 132,084 unvested restricted stock units (each of which represents the right to receive one share upon vesting).
|
(h)
|
Includes 433 shares held through the Company’s 401(k) retirement savings plan and 79,551 unvested restricted stock units expected to vest within 60 days, but does not include 16,000 other shares of unvested restricted stock or 80,229 unvested restricted stock units (each of which represents the right to receive one share upon vesting).
|
(i)
|
Group includes those persons who were serving as directors and executive officers on November 13,
2018
. Number shown includes 2,298 shares held through the Company’s 401(k) retirement savings plan, 175,000 shares of unvested restricted stock and 877,776 unvested restricted stock units expected to vest within 60 days, but does not include 212,880 other shares of unvested restricted stock or 1,417,205 unvested restricted stock units (each of which represents the right to receive one share upon vesting).
|
*
|
Shares beneficially owned do not exceed one percent of Class A Common Stock.
|
Director
|
|
Status (a)
|
|
|
|
Matthew W. Appel
|
|
Independent
|
Santiago Creel Miranda
|
|
Independent
|
Peter Cumins
|
|
Not independent (b)
|
Pablo Lagos Espinosa
|
|
Independent
|
Lachlan P. Given
|
|
Not independent (c)
|
Stuart I. Grimshaw
|
|
Not independent (c)
|
Joseph L. Rotunda
|
|
Not independent (c)
|
(a)
|
The Board’s determination that a director is independent was made on the basis of the standards for independence set forth in the Nasdaq Listing Rules. Under those standards, a person generally will not be considered independent if he or she has a relationship that, in the opinion of the Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The Nasdaq rules also describe specific relationships that will prevent a person from being considered independent.
|
(b)
|
Mr. Cumins is the Executive Vice Chairman and a member of the board of directors of Cash Converters International Limited. Mr. Grimshaw serves as the chairman of the board of directors of Cash Converters International, and Mr. Given also serves on the board of directors. Because of this relationship, the Board does not treat Mr. Cumins as an independent director, even though he might qualify as such under the Nasdaq Listing Rules.
|
(c)
|
Mr. Grimshaw, Mr. Given and Mr. Rotunda are executive officers and, therefore, are not independent in accordance with the standards set forth in the Nasdaq Listing Rules.
|
|
Year Ended September 30,
|
||||||
|
2018
|
|
2017
|
||||
|
|
|
|
||||
Audit of financial statements and audit pursuant to section 404 of the Sarbanes-Oxley Act and quarterly reviews
|
$
|
1,441,446
|
|
|
$
|
1,407,722
|
|
Audit related fees
|
—
|
|
|
—
|
|
||
Tax fees
|
—
|
|
|
—
|
|
||
All other fees
|
—
|
|
|
—
|
|
||
|
$
|
1,441,446
|
|
|
$
|
1,407,722
|
|
•
|
Report of Independent Registered Public Accounting Firm (2018 and 2017) — BDO USA, LLP
|
•
|
Consolidated Balance Sheets as of
September 30, 2018
and
2017
|
•
|
Consolidated Statements of Operations for each of the three years in the period ended
September 30, 2018
|
•
|
Consolidated Statements of Comprehensive Income (Loss) for each of the three years in the period ended
September 30, 2018
|
•
|
Consolidated Statements of Cash Flows for each of the three years in the period ended
September 30, 2018
|
•
|
Consolidated Statements of Stockholders’ Equity for each of the three years in the period ended
September 30, 2018
|
•
|
Notes to Consolidated Financial Statements.
|
Exhibit No.
|
|
Description of Exhibit
|
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
4.1
|
|
Specimen of Class A Non-voting Common Stock certificate (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1 effective August 23, 1991, Commission File No. 33-41317)
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
101.INS†††
|
|
XBRL Instance Document
|
101.SCH†††
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL†††
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.LAB†††
|
|
XBRL Taxonomy Label Linkbase Document
|
101.DEF†††
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.PRE†††
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
|
Identifies Exhibit that consists of or includes a management contract or compensatory plan or arrangement.
|
†
|
|
Filed herewith.
|
††
|
|
Furnished herewith.
|
†††
|
|
Filed herewith as Exhibit 101 to this report are the following formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets at September 30, 2018, and September 30, 2017; (ii) Consolidated Statements of Operations for the years ended September 30, 2018, September 30, 2017 and September 30, 2016; (iii) Consolidated Statements of Comprehensive Income (Loss) for the years ended September 30, 2018, September 30, 2017 and September 30, 2016; Consolidated Statements of Cash Flows for the for the years ended September 30, 2018, September 30, 2017 and September 30, 2016; Consolidated Statements of Shareholders’ Equity for the years ended September 30, 2018, September 30, 2017 and September 30, 2016; and (iv) Notes to Consolidated Financial Statements.
|
|
EZCORP, Inc.
|
|
|
Date: November 14, 2018
|
By:
|
/s/ Daniel M. Chism
|
|
|
|
Daniel M. Chism,
Chief Financial Officer
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Stuart I. Grimshaw
|
|
Chief Executive Officer and Director
(principal executive officer)
|
|
November 14, 2018
|
Stuart I. Grimshaw
|
|
|
|
|
|
|
|
|
|
/s/ Daniel M. Chism
|
|
Chief Financial Officer
(principal financial officer)
|
|
November 14, 2018
|
Daniel M. Chism
|
|
|
|
|
|
|
|
|
|
/s/ Lachlan P. Given
|
|
Executive Chairman of the Board
|
|
November 14, 2018
|
Lachlan P. Given
|
|
|
|
|
|
|
|
|
|
/s/ Matthew W. Appel
|
|
Director
|
|
November 14, 2018
|
Matthew W. Appel
|
|
|
|
|
|
|
|
|
|
/s/ Santiago Creel Miranda
|
|
Director
|
|
November 14, 2018
|
Santiago Creel Miranda
|
|
|
|
|
|
|
|
|
|
/s/ Peter Cumins
|
|
Director
|
|
November 14, 2018
|
Peter Cumins
|
|
|
|
|
|
|
|
|
|
/s/ Pablo Lagos Espinosa
|
|
Director
|
|
November 14, 2018
|
Pablo Lagos Espinosa
|
|
|
|
|
|
|
|
|
|
/s/ Joseph L. Rotunda
|
|
Director
|
|
November 14, 2018
|
Joseph L. Rotunda
|
|
|
|
|
|
|
|
|
|
/s/ David McGuire
|
|
Deputy Chief Financial Officer and Chief Accounting Officer
(principal accounting officer)
|
|
November 14, 2018
|
David McGuire
|
|
|
|
|
SUBSIDIARIES OF EZCORP, INC.
|
||
Entity
|
|
Jurisdiction of Organization
|
|
||
Artiste Holding Limited
|
|
United Kingdom
|
Brainerd Honduras, S.A. de C.V.
|
|
Honduras
|
Brainerd, S.A.
|
|
Guatemala
|
Brainerd, S.A.C.
|
|
Peru
|
Brainerd, S.A. de C.V
|
|
El Salvador
|
Camira Administration Corp
|
|
British Virgin Islands
|
Cap City Holdings, LLC
|
|
Delaware
|
CCV Americas, LLC
|
|
Delaware
|
CCV Latin America Coöperatief, U.A.
|
|
Netherlands
|
CCV Pennsylvania, Inc.
|
|
Delaware
|
CCV Virginia, Inc.
|
|
Delaware
|
Change Capital International Holdings, B.V.
|
|
Netherlands
|
Change Capital Mexico Holdings, S.A. de C.V.
|
|
Mexico
|
Change Capital, Inc.
|
|
Delaware
|
De Morgan Services Limited
|
|
United Kingdom
|
EZ Talent S. de R.L. de C.V.
|
|
Mexico
|
EZ Transfers S.A. de C.V.
|
|
Mexico
|
EZCORP (2015) Asia-Pacific PTE. LTD.
|
|
Singapore
|
EZCORP Latin America Coöperatief, U.A.
|
|
Netherlands
|
EZCORP Global Holdings, C.V.
|
|
Netherlands
|
EZCORP Global, B.V.
|
|
Netherlands
|
EZCORP International Holdings, LLC
|
|
Delaware
|
EZCORP International, Inc.
|
|
Delaware
|
EZCORP USA, Inc.
|
|
Delaware
|
EZMONEY Alabama, Inc.
|
|
Delaware
|
EZMONEY Canada Holdings, Inc.
|
|
British Columbia
|
EZMONEY Canada, Inc.
|
|
Delaware
|
EZMONEY Colorado, Inc.
|
|
Delaware
|
EZMONEY Hawaii, Inc.
|
|
Delaware
|
EZMONEY Holdings, Inc.
|
|
Delaware
|
EZMONEY Idaho, Inc.
|
|
Delaware
|
EZMONEY Kansas, Inc.
|
|
Delaware
|
EZMONEY Management, Inc.
|
|
Delaware
|
EZMONEY Missouri, Inc.
|
|
Delaware
|
EZMONEY South Dakota, Inc.
|
|
Delaware
|
EZMONEY Tario, Inc.
|
|
British Columbia
|
EZMONEY Tennessee, Inc.
|
|
Delaware
|
EZMONEY Utah, Inc.
|
|
Delaware
|
EZMONEY Wisconsin, Inc.
|
|
Delaware
|
EZParkway Services Limited
|
|
Ireland
|
EZParkway Trading Limited
|
|
Ireland
|
EZParkway Mexico Limited
|
|
Ireland
|
SUBSIDIARIES OF EZCORP, INC.
|
||
Entity
|
|
Jurisdiction of Organization
|
EZPAWN Alabama, Inc.
|
|
Delaware
|
EZPAWN Arizona, Inc.
|
|
Delaware
|
EZPAWN Arkansas, Inc.
|
|
Delaware
|
EZPAWN Colorado, Inc.
|
|
Delaware
|
EZPAWN Florida, Inc.
|
|
Delaware
|
EZPAWN Georgia, Inc.
|
|
Delaware
|
EZPAWN Holdings, Inc.
|
|
Delaware
|
EZPAWN Illinois, Inc.
|
|
Delaware
|
EZPAWN Indiana, Inc.
|
|
Delaware
|
EZPAWN Iowa, Inc.
|
|
Delaware
|
EZPAWN Management Mexico, S. de R.L. de C.V.
|
|
Mexico
|
EZPAWN Mexico Holdings, LLC.
|
|
Delaware
|
EZPAWN Mexico Ltd., LLC.
|
|
Delaware
|
EZPAWN Minnesota, Inc.
|
|
Delaware
|
EZPAWN Nevada, Inc.
|
|
Delaware
|
EZPAWN Oklahoma, Inc.
|
|
Delaware
|
EZPAWN Oregon, Inc.
|
|
Delaware
|
EZPAWN Services Mexico, S. de R.L. de C.V.
|
|
Mexico
|
EZPAWN Tennessee, Inc.
|
|
Delaware
|
EZPAWN Utah, Inc.
|
|
Delaware
|
Janama Honduras, S.A. de C.V.
|
|
Honduras
|
Janama, S.A.
|
|
Guatemala
|
Janama, S.A.C.
|
|
Peru
|
Janama, S.A. de C.V.
|
|
El Salvador
|
Khoper Advisors, Ltd.
|
|
British Virgin Islands
|
Madras Investments Corp.
|
|
British Virgin Islands
|
Maxiefectivo Peru, S.A.C.
|
|
Peru
|
Maxiprestamos, S.A. de C.V.
|
|
El Salvador
|
Miravet Planning Corp
|
|
Panama
|
Mister Money Holdings, Inc.
|
|
Colorado
|
Operadora de Servicios, S.A. de C.V.
|
|
El Salvador
|
Parkway Insurance, Inc.
|
|
Texas
|
Payday Loan Management, Inc.
|
|
Delaware
|
Premier Pawn and Jewelry, LLC
|
|
Delaware
|
Prenda Aval, S.A. de C.V.
|
|
El Salvador
|
Renueva Comercial, S.A.P.I. de C.V.
|
|
Mexico
|
Rich Data Corporation Solutions PTE. LTD.
|
|
Singapore
|
Rich Data Corporation North America Inc.
|
|
Delaware
|
Rich Data Corporation (Australia) PTY. LTD.
|
|
Australia
|
Salvaprenda, S.A. de C.V.
|
|
El Salvador
|
Shenzhen Shu Feng Technology Co. LTD.
|
|
China
|
Texas EZMONEY, L.P.
|
|
Texas
|
Texas EZPAWN Management, Inc.
|
|
Delaware
|
Texas EZPAWN, L.P.
|
|
Texas
|
Texas PRA Management, L.P.
|
|
Texas
|
SUBSIDIARIES OF EZCORP, INC.
|
||
Entity
|
|
Jurisdiction of Organization
|
Twyford Developments Limited
|
|
United Kingdom
|
Unicode Market, Inc.
|
|
Panama
|
USA Pawn & Jewelry Co. XI, LLC
|
|
Nevada
|
USA Pawn & Jewelry Co. 19, LLC
|
|
Nevada
|
1.
|
I have reviewed this Annual Report on Form 10-K of EZCORP, Inc.;
|
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 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:
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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;
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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;
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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
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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
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5.
|
The registrant’s other certifying officer 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.
|
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/s/
Stuart I. Grimshaw
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||
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Stuart I. Grimshaw
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||
|
Chief Executive Officer
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1.
|
I have reviewed this Annual Report on Form 10-K of EZCORP, Inc.;
|
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 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 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.
|
|
/s/ Daniel M. Chism
|
||
|
Daniel M. Chism
|
||
|
Chief Financial Officer
|
|
/s/ Stuart I. Grimshaw
|
||
|
Stuart I. Grimshaw
|
||
|
Chief Executive Officer
|
||
|
|
||
|
/s/ Daniel M. Chism
|
||
|
Daniel M. Chism
|
||
|
Chief Financial Officer
|