<PAGE> 1
================================================================================
SECURITIES AND EXHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-9733
CASH AMERICA INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
TEXAS 75-2018239
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
1600 WEST 7TH STREET
FORT WORTH, TEXAS 76102
(Address of principal executive offices) (Zip Code)
(817) 335-1100
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
28,749,560 common shares, $.10 par value, were outstanding as of April 30, 1996
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<PAGE> 2
CASH AMERICA INTERNATIONAL, INC.
INDEX TO 10-Q
PART I. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets - March 31, 1996
and 1995 and December 31, 1995................................... 1
Consolidated Statements of Income - Three Months
Ended March 31, 1996 and 1995.................................... 2
Consolidated Statements of Stockholders' Equity -
Three Months Ended March 31, 1996 and 1995....................... 3
Consolidated Statements of Cash Flows -
Three Months Ended March 31, 1996 and 1995....................... 4
Notes to Consolidated Financial Statements....................... 5
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations........ 8
PART II. OTHER INFORMATION............................................ 15
SIGNATURE.............................................................. 16
</TABLE>
<PAGE> 3
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(UNAUDITED)
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
March 31 Dec 31
1996 1995 1995
--------------- --------------- ----------------
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 3,919 $ 4,868 $ 3,435
Service charges receivable 10,923 10,620 11,829
Loans 85,475 79,344 87,782
Inventory, net 51,871 57,831 56,647
Prepaid expenses and other 5,044 6,656 4,823
Deferred tax asset 11,120 12,379 12,710
---------- -------------- -------------
Total current assets 168,352 171,698 177,226
Property and equipment, net 63,217 66,954 64,987
Intangible assets, net 62,518 65,834 63,421
Other assets 9,185 6,913 8,473
---------- -------------- -------------
Total assets $ 303,272 $ 311,399 $ 314,107
========== ============== =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 8,815 $ 8,772 $ 9,584
Customer layaway deposits 3,940 4,260 3,524
Income taxes currently payable 1,170 5,048 2,585
---------- -------------- -------------
Total current liabilities 13,925 18,080 15,693
Long-term debt:
Bank lines of credit 61,949 95,954 73,462
Notes payable 50,000 30,000 50,000
---------- -------------- -------------
111,949 125,954 123,462
Stockholders' equity:
Common stock, $.10 par value per
share, 80,000,000 shares authorized 3,024 3,024 3,024
Paid in surplus 121,861 121,525 121,840
Retained earnings 64,578 52,608 61,727
Notes receivable - stockholders (1,071) - (1,071)
Foreign currency translation adjustment (4,304) (2,403) (3,834)
---------- -------------- -------------
184,088 174,754 181,686
Less - shares held in treasury, at cost (6,690) (7,389) (6,734)
---------- -------------- -------------
Total stockholders' equity 177,398 167,365 174,952
---------- -------------- -------------
Total liabilities and stockholders' equity $ 303,272 $ 311,399 $ 314,107
========== ============== =============
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share) (UNAUDITED)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
Three Months Ended
March 31
1996 1995
------------------------------
<S> <C> <C>
PAWN SERVICE CHARGES $ 21,536 $ 19,165
GROSS PROFIT FROM SALES
Sales 47,004 41,100
Cost of sales 29,040 24,302
---------- ----------
Gross profit 17,964 16,798
---------- ----------
NET REVENUES 39,500 35,963
---------- ----------
OPERATING EXPENSES
Operations 22,845 21,459
Administration 4,795 4,239
Amortization 856 911
Depreciation 3,105 2,727
---------- ----------
Total operating expenses 31,601 29,336
---------- ----------
Income from operations 7,899 6,627
Interest expense, net 2,492 2,458
Other (income)/expense 182 56
---------- ----------
Income before income taxes 5,225 4,113
Provision for income taxes 2,015 1,457
---------- ----------
Income before cumulative effect of a change
in accounting principle 3,210 2,656
Cumulative effect on prior years (to
December 31, 1994) of changing to a
different revenue recognition method (Note 2) (19,772)
---------- ----------
NET INCOME (LOSS) $ 3,210 $ (17,116)
========== ==========
- ----------------------------------------------------------------------------------------------------
Amounts per common share:
Income before cumulative effect of a change
in accounting principle $ 0.11 $ 0.09
Cumulative effect on prior years (to
December 31, 1994) of changing to a
different revenue recognition method $ $ (0.68)
---------- ----------
Net income (loss) $ 0.11 $ (0.59)
========== ==========
Weighted average shares - Fully diluted (in thousands): 28,740 29,033
- ----------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.
Page 2
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Three Months Ended March 31, 1996 and 1995
(Dollars in thousands, except shares) (UNAUDITED)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Notes Foreign
Common Stock Treasury Stock Receivable Currency
----------------------- Paid In Retained ------------------- Stock- Translation
Shares Amount Surplus Earnings Shares Amount holders Adjustment Total
---------- ---------- -------- -------- --------- -------- --------- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at
December 31, 1995 30,235,164 $ 3,024 $121,840 $ 61,727 1,495,285 $ (6,734) $ (1,071) $ (3,834) $174,952
Net income 3,210 3,210
Dividends declared (359) (359)
Treasury shares reissued 10 (9,681) 44 54
Tax benefit from exercise
of option shares 11 11
Foreign currency
translation adjustment (470) (470)
---------- ---------- -------- -------- --------- -------- --------- ------- --------
Balance at
March 31, 1996 30,235,164 $ 3,024 $121,861 $ 64,578 1,485,604 $ (6,690) $ (1,071) $(4,304) $177,398
========== ========== ======== ======== ========= ======== ========= ======= ========
- ------------------------------------------------------------------------------------------------------------------------------------
Balance at
December 31, 1994 30,235,164 $ 3,024 $121,481 $ 70,081 1,666,099 $ (7,460) $ - $(3,692) $183,434
Net loss (17,116) (17,116)
Dividends declared (357) (357)
Treasury shares reissued 31 (15,733) 71 102
Tax benefit from exercise
of option shares 13 13
Foreign currency
translation adjustment 1,289 1,289
---------- ---------- -------- -------- --------- -------- --------- ------- --------
Balance at
March 31, 1995 30,235,164 $ 3,024 $121,525 $ 52,608 1,650,366 $ (7,389) $ - $(2,403) $167,365
========== ========== ======== ======== ========= ======== ========= ======= ========
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.
Page 3
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands) (UNAUDITED)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Three Months Ended
March 31
-----------------------------
1996 1995
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Reconciliation of Net Income (Loss) to Net
Cash Provided By Operating Activities:
Net income (loss) $ 3,210 $ (17,116)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Cumulative effect of accounting change - 19,772
Amortization 856 911
Depreciation 3,105 2,727
Decrease (increase) in service charges receivable 828 (344)
Decrease in inventory 4,772 458
Increase in prepaid expenses and other (181) (76)
Decrease in accounts payable
and accrued expenses (725) (5,119)
Increase in layaway deposits, net 416 682
(Decrease) increase in income taxes payable (1,203) 1,148
Deferred taxes 1,335 (583)
---------- -----------
Net cash provided by operating activities 12,413 2,460
---------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Loans forfeited and transferred to inventory 22,265 20,631
Loans repaid or renewed 63,195 57,456
Loans made, including loans renewed (83,639) (78,151)
---------- -----------
Net decrease (increase) in loans 1,821 (64)
Acquisitions (1,412)
Investment in and advances to affiliates (850) (350)
Purchases of property and equipment (1,393) (6,287)
---------- -----------
Net cash used by investing activities (422) (8,113)
---------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Net (payments) borrowings under bank lines of credit (11,131) 5,600
Proceeds from issuance of stock, net 54 102
Dividends paid (359) (357)
---------- -----------
Net cash (used) provided by financing activities (11,436) 5,345
---------- -----------
EFFECT OF EXCHANGE RATE CHANGES ON CASH (71) 349
---------- -----------
INCREASE IN CASH AND CASH EQUIVALENTS 484 41
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 3,435 4,827
---------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,919 $ 4,868
========== ===========
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
See notes to consolidated financial statements.
Page 4
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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (UNAUDITED)
- --------------------------------------------------------------------------------
NOTE 1 - BASIS OF PRESENTATION
The accompanying consolidated financial statements include the accounts
of Cash America International, Inc. and its wholly owned subsidiaries (the
"Company"). All significant intercompany accounts and transactions have been
eliminated in consolidation. At March 31, 1996, the Company had a 49%
ownership interest in Mr. Payroll Corporation ("Mr. Payroll") and Express Rent
A Tire Ltd. ("Express") (see Note 4). The investments are being accounted for
using the equity method of accounting, whereby the Company records its 49%
share of earnings or losses of its affiliates in its consolidated financial
statements.
The financial statements as of March 31, 1996 and 1995 and for the
three months then ended are unaudited but, in management's opinion, include all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair presentation of the results for such interim periods. Operating results
for the three months are not necessarily indicative of the results that may be
expected for the full fiscal year.
These financial statements and related notes should be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's 1995 Annual Report to Stockholders.
NOTE 2 - CHANGE IN ACCOUNTING PRINCIPLE
Effective January 1, 1995, the Company changed its method of income
recognition on pawn loans. The Company accrues pawn service charges for all
loans that the Company deems collection is probable based on historical loan
redemption statistics. For loans not repaid, the carrying value of the
forfeited collateral ("inventory") is stated at the lower of cost (cash amount
loaned) or market.
The cumulative effect of the accounting change on years prior to
January 1, 1995 of $19,772,000 (net of a tax benefit of $11,611,000) is included
as a reduction of net income for the first quarter of 1995.
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NOTE 3 - LONG-TERM DEBT
The Company's debt at March 31 consisted of:
<TABLE>
<CAPTION>
1996 1995
- -------------------------------------------------------------------------------------------------
(Dollars in Thousands)
<S> <C> <C> <C>
Debt Obligations:
Line of Credit $100 million due April 30, 1998 $ 32,700 $ 69,300
Line of Credit L.5 million due April 30, 1998 1,832 -0-
Swedish Kronor term loan due September 21, 1997 27,417 26,654
8.33% senior unsecured notes due 2003 30,000 30,000
8.14% senior unsecured notes due 2007 20,000 -0-
-------- --------
Total $111,949 $125,954
======== ========
</TABLE>
In addition, the Company has undrawn commitments as of March 31, 1996
for a $25 million line of credit that expires on June 5, 1996 and a 10,000,000
Swedish Kronor ("SEK") line of credit.
On May 28, 1993, the Company entered into two three-year swap
agreements for $10,000,000 each, under which the Company receives a fixed rate
of 4.87% and pays a variable rate based on the prevailing six-month BBA average
LIBOR rate (5.69% as of March 31, 1996), repriced every six months. For the
six-month period commencing December 2, 1995, the effective rate of interest on
the 8.33% Senior Notes is 8.93% on an annualized basis.
On June 2, 1995, the Company entered into a floating-to-fixed interest
rate exchange agreement. The agreement fixes the interest rate on SEK
118,750,000 (approximately $17,599,000 as of March 31, 1996) at 10.94% through
August 17, 1998. The effective rate of interest on the Swedish Term Loan at
March 31, 1996, was 10.25% after taking into account the interest rate exchange
agreement.
NOTE 4 - INVESTMENTS IN AFFILIATES
On July 13, 1994, the Company acquired a 49% interest in Mr. Payroll,
a private company which sells franchises for check-cashing kiosks. In
conjunction with its investment, the Company has entered into a revolving
credit agreement with Mr. Payroll which provides for maximum borrowings of $2.5
million from the Company. Interest is payable quarterly at a rate reset
monthly that is equivalent to LIBOR plus 4%. The entire unpaid principal
balance is due and payable in full on February 28, 1997. Mr. Payroll has
granted the Company a security interest in and lien on all of its assets. As
of March 31, 1996, Mr. Payroll had borrowings outstanding of $2,500,000. The
amounts are included in other assets.
On September 20, 1995, the Company acquired a 49% interest in Express
Rent a Tire, Ltd. ("Express"), a private company which offers new automobile
and
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truck tires and wheels on a rent-to-own basis. In conjunction with its
investment, the Company has entered into a revolving credit agreement with
Express which provides for maximum borrowings of $2 million from the Company.
Interest is payable quarterly at a rate reset monthly that is equivalent to
LIBOR plus 4%. The entire unpaid principal balance is due and payable in full
on February 28, 1998. Express has granted the Company a security interest in
all of its assets. As of March 31, 1996, Express had borrowings outstanding of
$1,150,000. The amounts are included in other assets.
NOTE 5 - LITIGATION
The Company is a defendant in certain lawsuits encountered in the
ordinary course of its business. In the opinion of management, the resolution
of these matters will not have a material adverse effect on the Company's
financial position or results of operations.
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Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations for the Three Months Ended
March 31, 1996 versus the Comparable 1995 Period
SUMMARY CONSOLIDATED FINANCIAL DATA
FIRST QUARTER ENDED MARCH 31, 1996 vs
FIRST QUARTER ENDED MARCH 31, 1995
- --------------------------------------------------------------------------------
The following table sets forth selected consolidated financial data with
respect to the Company for the three months ended March 31, 1996 and 1995.
<TABLE>
<CAPTION>
($ in thousands)
1996 1995 Change
---------- ------------ ------------
<S> <C> <C> <C>
Pawn service charges $ 21,536 $ 19,165 12%
Gross profit from sales
Sales 47,004 41,100 14%
Cost of sales 29,040 24,302 19%
--------- --------- ----
Gross profit 17,964 16,798 7%
--------- --------- ----
Net Revenues $39,500 $ 35,963 10%
--------- --------- ----
Other Data:
Annualized yield on loans 99% 98% 1%
Average loan balance per
average location in operation $ 234 $ 228 3%
Average pawn loan at end of
period (not in thousands) $ 94 $ 90 4%
Gross profit as a percentage of sales 38.2% 40.9% (7)%
Average annualized inventory turnover 2.1X 1.7X 24%
Average inventory balance per
average location in operation $ 148 $ 167 (11)%
Expenses as a percentage of net revenues:
Operations 57.8% 59.7% (3)%
Administration 12.1% 11.8% 3%
Depreciation and amortization 10.0% 10.1% (1)%
Interest, net 6.3% 6.8% (7)%
Locations in Operation:
Beginning of period 373 340
Acquired -- 3
Established 3 16
Combined (2) (2)
--------- ---------
End of period 374 357 5%
========= ========= ====
Average number of locations in
operation during the period (a) 374 349 7%
========= ========= ====
</TABLE>
(a) Averages based on accumulation of month-end balances and dividing aggregate
total by total months in the period.
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IMPACT OF EXPANDING OPERATIONS
The Company expanded its operations over the 15-month period from December
31, 1994 through March 31, 1996 with the addition of 39 pawnshops. Thirty-five
stores were started and four stores were acquired during the period, and five
stores were combined into existing locations for a net addition of 34 stores
during the 15-month period. At March 31, 1996, the Company operated 374
pawnshops--329 in 14 states in the United States, 35 jewelry-only and loan-only
pawnshops in the United Kingdom operating under the name Harvey & Thompson,
Ltd., and 10 loan-only and primarily jewelry-only pawnshops which are in Sweden
operating under the name Svensk Pantbelaning.
Net revenues (total revenues less cost of sales) increased $3.5 million, or
10%, in the first quarter of 1996 over the same period of 1995, resulting from
a 9% gain on comparable stores (those in operation more than one year) and a 7%
increase in average stores open during the two periods.
PAWN SERVICE CHARGES
Pawn service charges are impacted by changes in the average outstanding
amount of pawn loans and loan yields. Pawn service charges increased $2.4
million, or 12%, in the first quarter of 1996 over the first quarter of 1995 as
a result of same store increases in the average outstanding amount of pawn
loans of 7%, combined with increases in the average number of stores in
operation as noted above.
The yield on loans outstanding increased in the first quarter of 1996 to
approximately 99% from 98% for the same period in 1995. The consolidated 99%
annual loan yield represents a weighted average of the distinctive yields which
the Company realized in the three different countries in which it operates. In
its domestic operations, the Company realized yields of 129% and 125% in the
first quarter of 1996 and 1995, respectively. The increase is the result of an
8% decline in the outstanding loan balance in the first quarter of 1996
compared to a 3% decline in the first quarter of 1995. The Company believes
the higher percentage decline in outstanding loan balance is due in part to its
customers' earlier receipt of federal income tax refunds in 1996 compared to
1995. In 1995, changes in the processing methods utilized by the Internal
Revenue Service delayed federal income tax refunds. The Company believes that
many customers use a portion of their refund to repay loans and purchase items
of personal property and that, while the preponderance of this loan repayment
and purchasing activity in 1995 took place in the second quarter, the
preponderance of this activity in 1996 has taken place in the first quarter.
Internationally, loans at Harvey & Thompson in the United Kingdom yielded 71%
during the first quarter of 1996 and 1995, while loans at Svensk Pantbelaning
in Sweden yielded 46% during both periods, producing a blended international
yield of 56% in the first quarter of 1996 and 58% for the same period in 1995.
The slight decrease in the
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blended international loan yield is the result of higher same store increases
in the average outstanding amount of pawn loans in Sweden.
The 3% increase in average loan balance per average location in operation
and 4% increase in the average pawn loan at the end of the quarter are both a
result of the growth in average outstanding pawn loans of the Swedish
pawnbroking locations, which have higher averages per location and amounts per
loan.
SALES AND GROSS PROFIT
Retail sales for the three months ended March 31, 1996, increased 14%
compared to the same period of 1995. The rise in sales was impacted by the
increase in the average number of locations as noted above and a same store
sales increase of 7% over the first quarter of 1995. The Company believes that
the increased sales are due in part to its customer's earlier receipt of
federal income tax refunds discussed above and an emphasis on inventory
reduction.
Gross profit margins decreased to 38.2% for the three months ended March
31, 1996 compared to 40.9% for the same period in 1995. However, inventory
turns increased from 1.7 times to 2.1 times in 1996, leading to a 7% increase
in total gross profit. During the first quarter of 1996, the Company
introduced a new incentive compensation program with an emphasis on rewarding
the maximization of cash returns on capital employed. The timing on income tax
refunds and the new incentive program combined to increase revenues, increase
inventory turns, and decrease inventory levels while emphasizing increases in
net revenues. This emphasis resulted in a decrease in gross profit margins.
EXPENSES
Operations expenses as a percentage of net revenues decreased in the first
quarter of 1996 compared to 1995, due to greater emphasis on cost control and
better efficiencies of scale of operating multiple units. Overall, operations
expenses increased $1.4 million, or 6%, in the first quarter of 1996 compared
to the same period in 1995. The increase was driven by a 1% increase in same
store operations expenses and the 7% increase in average stores in operation
for the period. On a consolidated basis, operations and administration
expenses decreased from 71% of net revenues in the first quarter of 1995 to 70%
in the first quarter of 1996.
Domestic operations and administration expenses as a percentage of domestic
net revenues decreased to 73% in the first quarter of 1996, compared to 76% for
the same period in 1995. An emphasis on cost containment, coupled with a new
incentive pay plan for store employees and a moderation in the number of store
openings, contributed to this reduction in expenses as a percentage of net
revenues. As a percentage of foreign net revenues, operations and
administration costs related to foreign operations
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were 48% for the three months ended March 31, 1996, compared to 44% for the
corresponding period in 1995. This increase is due primarily to Harvey &
Thompson having flat net revenues in the first quarter of 1996 compared to the
same period in 1995 and the addition of start-up locations in its existing
markets.
Depreciation and amortization as a percentage of net revenues was constant
at 10% for the three month periods ending March 31, 1996 and 1995.
Net interest expense as a percentage of net revenues decreased to 6.3% for
the first quarter of 1996 compared to 6.8% for the first quarter of 1995. This
reduction resulted from a 4% decrease in average consolidated debt outstanding
and a higher effective interest rate on the Company's Swedish Term Loan.
Weighted average interest rates on domestic debt actually decreased to 7.59%
for the first quarter of 1996 compared to 7.87% for the same period in 1995.
OTHER INCOME/(EXPENSE)
During the first quarter of 1996 and 1995 the Company recorded losses from
its investments in affiliates of $205,000 and $90,000, respectively. These
losses were partially offset by rent income and other miscellaneous items.
INCOME TAXES
The Company's effective tax rate increased to 39% in the first quarter of
1996, compared to 35% in the same period in 1995. The domestic tax rate
remained unchanged at 41%, while the rate in the Company's foreign operations
increased from 30% to 34%. The 1995 foreign rate of 30% was due to the
utilization of miscellaneous tax credits in the United Kingdom during the first
quarter.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1996, cash and cash equivalents increased to $3.9 million from
$3.4 million at December 31, 1995. Causing this increase were cash flow from
operations of $12.4 million and a net decrease in pawn loans of $1.8 million,
which were partially offset by advances to affiliates of $.8 million, capital
expenditures for purchase of property and equipment of $1.4 million and
reduction of long-term debt of $11.1 million.
The Company currently has a $125 million unsecured bank line of credit, of
which $92.3 million was unused at March 31, 1996. The Company's wholly owned
subsidiary, Harvey & Thompson, Ltd. has a committed 5 million pound sterling
unsecured line of credit from a UK based commercial bank, of which 3.8 million
pounds sterling was unused at March 31, 1996. The Company's wholly owned
subsidiary, Svensk Pantbelaning AB, has a SEK 10
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million unsecured line of credit with a commercial bank, of which all SEK 10
million was unused at March 31, 1996.
The Company believes that funds provided from operations, coupled with the
Company's current working capital and available lines of credit, are
sufficient to meet its foreseeable cash requirements.
Page 12
<PAGE> 15
FOREIGN OPERATIONS
The following table sets forth selected consolidated financial data for
Harvey & Thompson and Svensk Pantbelaning as of March 31, 1996, and 1995 and
for the three month period then ended.
Balance sheet data for Harvey & Thompson has been translated from
pounds sterling into U.S. dollars using the end of the period currency exchange
rate of 1.527 at March 31, 1996 and 1.622 at March 31, 1995. Income statement
data has been translated at an average exchange rate of 1.532 for the three
month period ending March 31, 1996, compared to 1.583 for the same period in
1995.
Balance sheet data for Svensk Pantbelaning has been translated from
Swedish Kronor into U.S. dollars using the end of the period currency exchange
rate of 6.748 and 7.337 at March 31, 1996 and 1995 respectively. Income
statement data has been translated at an average exchange rate of 6.776 for the
three month period ending March 31, 1996, compared to 7.374 for the comparable
period in 1995.
<TABLE>
<CAPTION>
Three Months Ended March 31,
1996 1995 Change
--------- -------- --------
($ in thousands)
<S> <C> <C> <C>
Income Statement Data:
Net revenues $5,122 $4,777 7%
Operating expenses 2,703 2,320 17%
Income from operations 2,419 2,457 (2)%
Other Data:
Total average locations 46 42 10%
Gross profit margin 32.0% 52.0% (38)%
Average annualized inventory turns 3.3X 3.9X (15)%
Ending loan balance $37,067 $33,159 12%
Average loan balance
per average location in operation $783 $755 4%
Expenses as a percentage of net revenues:
Operations 35.4% 31.4% 13%
Administration 12.1% 12.6% (4)%
</TABLE>
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<PAGE> 16
Domestic Operations
Presented below is selected financial data for the Company's domestic
operations as of March 31, 1996 and 1995 and for the three months then ended:
<TABLE>
<CAPTION>
($ in thousands)
1996 1995 Change
---------- ---------- ---------
<S> <C> <C> <C>
Pawn service charges $ 16,510 $ 14,646 13%
Gross profit from sales
Sales 46,704 40,604 15%
Cost of sales 28,836 24,064 20%
------- ------- -----
Gross profit 17,868 16,540 8%
------- ------- -----
Net Revenues $34,378 $31,186 10%
------- ------- -----
Other Data:
Annualized yield on loans 129% 125% 3%
Average loan balance per
average location in operation $ 157 $ 155 1%
Average pawn loan at end of
period (not in thousands) $ 71 $ 69 3%
Gross profit as a percentage of sales 38.3% 40.7% (6)%
Average annualized inventory turnover 2.1X 1.7X 24%
Average inventory balance per
average location in operation $ 168 $ 189 (11)%
Expenses as a percentage of net revenues:
Operations 61.2% 64.0% (4)%
Administration 12.1% 11.7% 3%
Depreciation and amortization 10.7% 11.0% (3)%
Interest, net 5.2% 6.3% (17)%
Domestic Locations in Operation:
Beginning of period 327 300
Acquired -- 3
Established 3 13
Combined (1) (2)
------- --------
End of period 329 314 5%
======= ======== =====
Average number of locations in
operation during the period (a) 328 307 7%
======= ======== =====
</TABLE>
(a) Averages based on accumulation of month-end balances and dividing aggregate
total by total months in the period.
Page 14
<PAGE> 17
PART II
Item 1. LEGAL PROCEEDINGS
See Note 5 of Notes to Consolidated Financial Statements
Item 2. CHANGES IN SECURITIES
Not Applicable
Item 3. DEFAULTS UPON SENIOR SECURITES
Not Applicable
Item 4. SUBMISSION OF MATTERS TO A VOTE SECURITY HOLDERS
Not Applicable
Item 5. OTHER INFORMATION
Not Applicable
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27 Financial Data Schedule
(b) Reports on Form 8-K - None
Page 15
<PAGE> 18
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CASH AMERICA INTERNATIONAL, INC.
---------------------------------------------
(Registrant)
BY: /S/ Daniel R. Feehan
---------------------------------------------
Daniel R. Feehan
President and
Principal Financial Officer
Date: May 13, 1996
Page 16
<PAGE> 19
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 3,919
<SECURITIES> 0
<RECEIVABLES> 96,398
<ALLOWANCES> 0
<INVENTORY> 51,871
<CURRENT-ASSETS> 168,352
<PP&E> 104,045
<DEPRECIATION> 40,828
<TOTAL-ASSETS> 303,272
<CURRENT-LIABILITIES> 13,925
<BONDS> 111,949
<COMMON> 3,024
0
0
<OTHER-SE> 174,374
<TOTAL-LIABILITY-AND-EQUITY> 303,272
<SALES> 47,004
<TOTAL-REVENUES> 68,540
<CGS> 29,040
<TOTAL-COSTS> 51,885
<OTHER-EXPENSES> 8,756
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,492
<INCOME-PRETAX> 5,225
<INCOME-TAX> 2,015
<INCOME-CONTINUING> 3,210
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,210
<EPS-PRIMARY> .11
<EPS-DILUTED> .11
</TABLE>
