13
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 December 31, 1997
OR
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO
FEE REQUIRED]
For the transition period from ______________ to
_____________
Commission File Number 0-19424
_______________________________
EZCORP, INC.
(Exact name of registrant as specified in its charter)
Delaware 74-2540145
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1901 Capital Parkway
Austin, Texas 78746
(Address of principal executive offices)
(Zip Code)
(512) 314-3400
(Registrant's telephone number, including area code)
NA
(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:
The only class of voting securities of the registrant
issued and outstanding is the Class B Voting Common Stock,
par value $.01 per share, 100% of which is owned by two
record holders, one of whom is an affiliate of the
registrant. There is no trading market for the Class B
Voting Common Stock.
As of December 31, 1997, 10,515,530 shares of the
registrant's Class A Non-voting Common Stock, par value $.01
per share and 1,480,301 shares of the registrant's Class B
Voting Common Stock, par value $.01 per share were
outstanding.
<PAGE>
EZCORP, INC.
INDEX TO FORM 10-Q
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets -
December 31, 1997 and September 30, 1997 1
Condensed Consolidated Statements of Operations -
Three Months Ended December 31, 1997 and 1996 2
Condensed Consolidated Statements of Cash Flows -
Three Months Ended December 31, 1997 and 1996 3
Notes to Interim Condensed Consolidated Financial
Statements 4
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 7
PART II. OTHER INFORMATION 11
SIGNATURE 13
<PAGE>
PART I
Item 1. Financial Statements (Unaudited)
EZCORP, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
<TABLE>
<CAPTION>
December 31, September 30,
1997 1997
------------ -------------
(In thousands)
<S> <C> <C>
ASSETS:
Current assets:
Cash and cash equivalents $ 1,084 $ 829
Pawn loans 39,109 42,837
Service charge receivable 11,851 13,130
Inventory, net 40,928 39,258
Deferred tax asset 1,364 1,889
Prepaids and other assets 2,619 1,965
------- -------
Total current assets 96,955 99,908
Property and equipment, net 32,577 32,586
Other assets:
Deferred tax asset 1,730 1,730
Other assets, net 18,129 16,827
------- -------
Total assets $149,391 $151,051
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Current maturities of
long-term debt $ 9 $ 9
Federal income taxes payable 1,212 819
Other 9,133 9,629
------- -------
Total current liabilities 10,354 10,457
Long-term debt, less current
maturities 15,130 19,133
Other long-term liabilities 187 -
Stockholders' equity:
Preferred stock, par value
$.01 a share - Authorized
5,000,000 shares; none issued
and outstanding - -
Class A Non-voting Common stock,
par value $.01 a share -
Authorized 40,000,000 shares;
10,524,563 shares issued and
10,515,530 shares outstanding at
December 31, 1997 and September
30, 1997 105 105
Class B Voting Common stock, par
value $.01 a share - Authorized
1,484,407 shares; 1,480,301 shares
issued and outstanding at December
31, 1997 and September 30, 1997 15 15
Additional paid-in capital 114,338 114,338
Retained earnings 10,026 7,767
------- -------
124,484 122,225
Other (764) (764)
------- -------
Total stockholders' equity 123,720 121,461
------- -------
Total liabilities and
stockholders' equity $149,391 $151,051
</TABLE> ======= =======
See Notes to Interim Condensed Consolidated Financial
Statements (unaudited).
<PAGE>
EZCORP, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
-----------------------
1997 1996
-----------------------
(In thousands, except
per share amounts)
<S> <C> <C>
Revenues:
Sales $ 30,956 $ 27,100
Pawn service charges 20,988 18,742
------- -------
Total revenues 51,944 45,842
Cost of goods sold 26,079 22,512
------- -------
Net revenues 25,865 23,330
Operating expenses:
Operations 16,689 15,013
Administrative 3,355 3,193
Depreciation and amortization 1,798 1,890
------- -------
Total operating expenses 21,842 20,096
------- -------
Operating income 4,023 3,234
Interest expense 380 291
------- -------
Income before income taxes 3,643 2,943
Income tax expense 1,384 1,040
------- -------
Net income $ 2,259 $ 1,903
======= =======
Basic and diluted earnings per share $ 0.19 $ 0.16
======= =======
Weighted average shares outstanding
Basic 11,995,831 11,992,728
========== ==========
Diluted 12,011,698 11,996,612
========== ==========
</TABLE>
See Notes to Interim Condensed Consolidated Financial
Statements (unaudited).
<PAGE>
EZCORP, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
<TABLE>
<CAPTION> Three Months Ended
December 31,
-----------------------
1997 1996
-----------------------
(In thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 2,259 $ 1,903
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and amortization 1,798 1,890
Deferred income taxes 526 (394)
Gain on sale of assets (109) -
Changes in operating assets and
liabilities:
(Increase)/decrease in service
charge receivable 1,402 (431)
(Increase)/decrease in
inventories (1,503) 1,161
(Increase)/decrease in prepaid
expenses and other assets (757) 587
Decrease in accounts payable
and accrued expenses (650) (600)
Increase/(decrease) in customer
layaway deposits 145 (2)
Increase in other long term
liabilities 187 -
Increase in income taxes payable 391 620
------- -------
Net cash provided by operating
activities 3,689 4,734
INVESTING ACTIVITIES:
Pawn loans forfeited and transferred
to inventories 17,358 12,593
Pawn loans made (40,986) (39,674)
Pawn loans repaid 27,770 25,942
------- -------
Net (increase)/decrease in loans 4,142 (1,139)
Additions to property, plant, and
equipment (1,672) (1,181)
Acquisitions, net of cash acquired (2,104) -
Sale of assets 203 -
------- -------
Net cash provided by/(used in)
investing activities 569 (2,320)
FINANCING ACTIVITIES:
Proceeds from bank borrowings 2,000 1,000
Payments on borrowings (6,003) (2,040)
------- -------
Net cash used by financing activities (4,003) (1,040)
------- -------
Increase in cash and cash equivalents 255 1,374
Cash and cash equivalents at
beginning of period 829 1,419
------- -------
Cash and cash equivalents at
end of period $ 1,084 $ 2,793
======= =======
NONCASH INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock to 401(k) Plan $ - $ 37
======= =======
</TABLE>
See Notes to Interim Condensed Consolidated Financial
Statements (unaudited).
<PAGE>
EZCORP, Inc. and Subsidiaries
Notes to Interim Condensed Consolidated Financial Statements
(Unaudited)
December 31, 1997
Note A - Basis of Presentation
The accompanying unaudited
condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting
principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal
recurring entries) considered necessary for a fair
presentation have been included. The accompanying financial
statements should be read with the Notes to Consolidated
Financial Statements included in the Company's Annual Report
on Form 10-K for the year ended September 30, 1997.
The Company's business is subject to seasonal
variations, and operating results for the three-month period
ended December 31, 1997 are not necessarily indicative of
the results of operations for the full fiscal year.
Note B - Accounting Principles and Practices
The provision for federal income taxes has been
calculated based on the Company's estimate of its effective
tax rate for the full fiscal year.
The Company provides inventory reserves for shrinkage
and cost in excess of market value. The Company estimates
these reserves using analysis of sales trends, inventory
aging, sales margins and shrinkage on inventory. As of
December 31, 1997, inventory reserves were $6.7 million.
Note C - Statement of Cash Flows
The amounts for December 31, 1996 in the investing
section for pawn loans made, pawn loans repaid and pawn
loans forfeited and transferred to inventories have been
reclassified. The net increase/(decrease) in loans and the
net cash provided by/(used in) investing activities are
unchanged.
Note D - Earnings Per Share
In 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 128,
Earnings Per Share. Statement 128 replaces the previously
reported primary and fully diluted earnings per share with
basic and diluted earnings per share. Unlike primary
earnings per share, basic earnings per share excludes any
dilutive effects of options, warrants and convertible
securities. Diluted earnings per share is very similar to
the previously reported fully diluted earnings per share.
All earnings per share amounts for all periods have been
presented, and where necessary, restated to conform to the
Statement 128 requirements.
<PAGE>
EZCORP, Inc. and Subsidiaries
Notes to Interim Condensed Consolidated Financial Statements
(Unaudited)
December 31, 1997
The following table sets forth the computation of basic and
diluted earnings per share:
<TABLE>
<CAPTION> Three Months Ended
December 31,
--------------------
1997 1996
--------------------
(In thousands)
<S> <C> <C>
Numerator
Numerator for basic and
diluted earnings per share -
net income $ 2,259 $ 1,903
======= =======
Denominator
Denominator for basic earnings
per share - weighted average
shares 11,996 11,993
Effect of dilutive securities:
Employee stock options 4 -
Warrants 12 4
------- -------
Dilutive potential common shares 16 4
------- -------
Denominator for diluted earnings
per share - adjusted weighted
average shares and assumed
conversions 12,012 11,997
======= =======
Basic earnings per share $ 0.19 $ 0.16
======= =======
Diluted earnings per share $ 0.19 $ 0.16
</TABLE> ======= =======
Options to purchase 567,476 weighted average shares of
common stock at an average price of $13.53 per share were
outstanding at December 31, 1997, but were not included in
the computation of diluted earnings per share because the
options' exercise price was greater than the average market
price of the common shares and, therefore, the effect would
be anti-dilutive.
Note E - Litigation
The Company is involved in litigation relating to
claims that arise from time to time from normal business
operations. Currently, the Company is a defendant in
several lawsuits. Some of these lawsuits involve claims for
substantial amounts. While the ultimate outcome of these
lawsuits involving the Company cannot be ascertained, after
consultation with counsel, it is management's opinion that
the resolution of these suits will not have a material
adverse effect on the Company's financial condition or
results of operations. However, there can be no assurance
as to the ultimate outcome of these matters.
On February 4, 1998, the Company and its founder and
former President and Chief Executive Officer, Courtland L.
Logue, Jr. reached an out of court settlement to the lawsuit
styled EZCORP, Inc. v. Courtland L. Logue, Jr., in the 201st
District Court of Travis County, Texas. Under the terms of
the settlement, both the Company and Mr. Logue released
their claims against each other, including all claims under
Mr. Logue's employment agreement, and neither party admitted
any liability nor paid any cash consideration to the other.
The Company agreed to accelerate the release of
contractual restrictions on the transfer of Mr. Logue's
967,742 shares of common stock, which converts, as of a
closing scheduled on or before February 18, 1998, to
publicly traded Class A Non-Voting Common Stock. In
exchange, Mr. Logue agreed to assign 10,000 shares of his
stock to the Company.
<PAGE>
EZCORP, Inc. and Subsidiaries
Notes to Interim Condensed Consolidated Financial Statements
(Unaudited)
December 31, 1997
The settlement releases 191,548 shares immediately, and
a like amount on October 29, 1998. An additional 95,774
shares will be released from restrictions on each of October
29, 1999 and October 29, 2000, with the remaining 40% of the
shares to be released in July, 2001, as originally
scheduled. The Company and Mr. Logue also clarified the
scope of Mr. Logue's continuing non-competition agreement,
negotiated a five year limitation on Mr. Logue's financial
investments in competing pawnshop businesses and negotiated
renewal options with respect to certain existing real estate
leases for store locations.
The Company is also the nominal defendant in a lawsuit
filed July 18, 1997 by a holder of thirty-nine (39) shares
of Company stock styled for the benefit of the Company
against certain directors of the Company in the Castle
County Court of Chancery in the State of Delaware. The suit
alleges the defendants breached their fiduciary duties to
the Company in approving certain management incentive
compensation arrangements and an affiliate's financial
advisory services contract with the Company. The suit seeks
recision of the subject agreements, unspecified damages and
expenses, including plaintiff's legal fees. The
defendants have filed a motion to dismiss which is pending
before the court.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
First Quarter Ended December 31, 1997 vs. First Quarter
Ended December 31, 1996
The discussion in this section of this report contains
forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ
materially from those discussed herein. Factors that could
cause or contribute to such differences include, but are not
limited to, those discussed in this section and those
discussed elsewhere in this report.
The following table sets forth selected, unaudited,
consolidated financial data with respect to the Company for
the three months ended December 31, 1997 and 1996.
<TABLE> Three Months Ended % or
<CAPTION> December 31, (a) Point
1997 1996 Change(b)
-------------------- ---------
<S> <C> <C> <C>
Net Revenues:
Sales $ 30,956 $ 27,100 14.2%
Pawn service charges 20,988 18,742 12.0%
------- -------
Total revenues 51,944 45,842 13.3%
Cost of goods sold 26,079 22,512 15.8%
------- -------
Net revenues $ 25,865 $ 23,330 10.9%
Other Data: ======= =======
Gross profit as a
percent of sales 15.8% 16.9% (1.1) pts.
Average annual inventory
turnover 2.5x 2.5x 0.0x
Average inventory balance
per location as of the
end of the quarter $164 $140 17.1%
Average loan balance per
location as of the end
of the quarter $156 $144 8.3%
Average yield on loan
portfolio 204% 213% (9.0) pts.
Redemption rate 76% 79% (3.0) pts.
Expenses as a Percent of Total Revenues:
Operating 32.1% 32.7% (0.6) pts.
Administrative 6.5% 7.0% (0.5) pts.
Depreciation and
amortization 3.5% 4.1% (0.6) pts.
Interest, net 0.7% 0.6% 0.1 pt.
Locations in Operation:
Beginning of period 249 246
Acquired 1 0
Established 1 2
Sold, combined or closed (1) 0
----- -----
End of period 250 248
Average locations in operation ===== =====
during the period(c) 249.5 247.0
</TABLE> ===== =====
- ------------------------------------------
a In thousands, except percentages, inventory turnover
and store count.
b In comparing the period differences between dollar
amounts or store counts, a percentage change is used.
In comparing the period differences between two
percentages, a percentage point (pt.) change is used.
c Average locations in operation during the period is
calculated based on the average of the locations
operating at the beginning and end of such period.
<PAGE>
Results of Operations
The following discussion compares results for the three-
month period ended December 31, 1997 ("Fiscal 1998 Period")
to the three month period ended December 31, 1996 ("Fiscal
1997 Period"). The discussion should be read in conjunction
with the accompanying financial statements and related
notes.
During the Fiscal 1998 Period, the Company opened one
(1) newly established store, acquired one (1) store and
closed one (1) store. During the twelve (12) months ended
December 31, 1997, the Company opened four (4) newly
establish stores, acquired one (1) store and closed three
(3) stores. The store closings were a result of the
Company's ongoing review of its store portfolio. At
December 31, 1997, the Company operated 250 stores in
thirteen (13) states.
The Company's primary activity is the making of small,
non-recourse loans secured by tangible personal property.
The income earned on this activity is pawn service charge
revenue. For the Fiscal 1998 Period, pawn service charge
revenue increased $2.2 million from the Fiscal 1997 Period
to $21.0 million. This resulted from an increase in same
store pawn service charge revenue ($2.0 million) and the
pawn service charge revenue from new stores not open the
full three-month period ($0.2 million). At December 31,
1997, same store pawn loan balances were seven percent above
December 31, 1996. The annualized yield on the average pawn
loan balance decreased nine percentage points from the
Fiscal 1997 Period to 204%. This decrease was primarily due
to a shift in pawn loan balances to states with lower pawn
service charge rates when compared to the Fiscal 1997
Period.
A secondary, but related, activity of the Company is
the sale of merchandise, primarily collateral forfeited from
its lending activity. For the Fiscal 1998 Period, sales
increased approximately $3.9 million from the Fiscal 1997
Period to approximately $31.0 million. This resulted from
an increase in same store merchandise sales ($3.4 million),
new store sales ($0.5 million), and scrapping activity ($0.1
million), partially offset by closed store sales ($0.1
million). Same store sales for the Fiscal 1998 Period
increased 13 percent from the Fiscal 1997 Period. Inventory
levels per store were 17% higher than the prior period due
to higher average loan balances during the preceding months
in the Fiscal 1998 Period (approximately $164,000 in the
Fiscal 1998 Period as compared to $140,000 in the Fiscal
1997 Period). Inventory turnover, at 2.5 times, was
unchanged in the Fiscal 1998 Period compared to the Fiscal
1997 Period.
The Company's gross margin level (gross profit as a
percentage of merchandise sales) results from, among other
factors, the composition, quality and age of its inventory.
At December 31, 1997, and 1996, respectively, the Company's
inventories consisted of approximately 64 and 65 percent
jewelry (e.g. ladies' and men's rings, chains, bracelets,
etc.) and 36 and 35 percent general merchandise (e.g.,
televisions, VCRs, tools, sporting goods, musical
instruments, firearms, etc.). At December 31, 1997 and
1996, respectively, 88% and 76% of the jewelry was less than
twelve months old based on the Company's date of acquisition
(date of forfeiture for collateral or date of purchase) as
was approximately 96% and 87% of the general merchandise
inventory for each period.
For the Fiscal 1998 Period, gross profits as a
percentage of merchandise sales decreased 1.1 percentage
points from the Fiscal 1997 Period to 15.8 percent. This
decrease results from lower gross profit on wholesale and
scrap jewelry sales (1.0 percentage point) and lower margins
on merchandise sales (0.2 percentage point) offset by a
reduction in inventory shrinkage when measured as a
percentage of merchandise sales (down 0.1 percentage point
to approximately 1.2 percentage points).
In the Fiscal 1998 Period, operating expenses as a
percentage of total revenues decreased 0.6 percentage point
from the Fiscal 1997 Period to 32.1%. Administrative
expenses decreased 0.5 percentage point in the Fiscal 1998
Period to 6.5%. These decreases result from the higher
level of revenues relative to these expenses in the Fiscal
1998 Period.
<PAGE>
The Company, like many companies, faces the Year 2000
Issue. This is a result of computer programs being written
using two digits rather than four (for example, "97" for
1997) to define the applicable year. Any of the Company's
programs that have time-sensitive software may recognize a
date using "00" as the year 1900 rather than the year 2000.
In some cases, the new date will cause computers to stop
operating, while in other cases, incorrect output may
result. Since the Company is currently in the process of
replacing and upgrading its computer hardware and software
systems, the Company believes that there is little business
risk attributable to the Year 2000 issue.
Liquidity and Capital Resources
Net cash provided by operating activities for the
Fiscal 1998 Period was $3.7 million as compared to $4.7
million provided in the Fiscal 1997 Period. Improved
operating results and lower pawn service charge receivable
offset by increases in inventory and prepaid expenses were
the main factors for the reduced cash provided by operating
activities. Net cash provided by investing activities was
$0.6 million for the Fiscal 1998 Period compared to $2.3
million used in the Fiscal 1997 period. The change is due
to decreases in pawn loan balances offset by higher levels
of capital expenditures and acquisitions for the Fiscal 1998
Period.
In the Fiscal 1998 Period, the Company invested
approximately $3.6 million to open one (1) newly established
store, to acquire one (1) store, to upgrade or replace
existing equipment and computer systems, and for
improvements at existing stores. The Company funded these
expenditures largely from cash flow provided by operating
activities. The Company plans to open approximately 50
stores during fiscal 1998, including the two stores already
opened. The Company anticipates that cash flow from
operations and funds available under its existing bank line
of credit should be adequate to fund these capital
expenditures and expected pawn loan growth during the coming
year. There can be no assurance, however, that the
Company's cash flow and line of credit will provide adequate
funds for these capital expenditures.
The Company's current revolving line of credit
agreement was amended on May 9, 1997 and matures January 30,
2000. That agreement requires, among other things, that the
Company meet certain financial covenants. Borrowings under
the line are unsecured and bear interest at the bank's
Eurodollar rate plus 0.75% to 1.5%. The amount which the
Company can borrow is based on a percentage of its inventory
levels and outstanding pawn loan balance, up to $50.0
million. At December 31, 1997, the Company had
approximately $15 million outstanding on the credit facility
and additional borrowing capacity of approximately $31
million.
Seasonality
Historically, pawn service charge revenues are highest
in the fourth fiscal quarter (July, August and September)
due to higher loan demand during the summer months and
merchandise sales are highest in the first and second fiscal
quarters (October through March) due to the holiday season
and tax refunds.
Forward-Looking Information
This Quarterly Report on Form 10-Q includes "forward-
looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements
other than statement of historical information provided
herein are forward-looking and may contain information about
financial results, economic conditions, trends and known
uncertainties. The Company cautions the reader that actual
results could differ materially from those expected by the
Company depending on the outcome of certain factors,
including without limitation (i) fluctuations in the
Company's inventory and loan balances, inventory turnover,
average yield on loan
<PAGE>
portfolio, redemption rates, labor and employment matters,
competition, operating risk, acquisition and expansion risk,
liquidity and capital requirements and the effect of
government and environmental
regulations and (ii) adverse changes in the market for the
Company's services. Readers are cautioned not to place
undue reliance on these forward-looking statements, which
speak only as of the date hereof. The Company undertakes no
obligations to release publicly the results of any revisions
to these forward-looking statements which may be made to
reflect events or circumstances after the date hereon,
including without limitation, changes in the Company's
business strategy or planned capital expenditures, or to
reflect the occurrence of unanticipated events.
<PAGE>
PART II
Item 1. Legal Proceedings
On February 4, 1998, the Company and its founder and
former President and Chief Executive Officer, Courtland L.
Logue, Jr. reached an out of court settlement to the lawsuit
styled EZCORP, Inc. v. Courtland L. Logue, Jr., in the 201st
District Court of Travis County, Texas. Under the terms of
the settlement, both the Company and Mr. Logue released
their claims against each other, including all claims under
Mr. Logue's employment agreement, and neither party admitted
any liability nor paid any cash consideration to the other.
The Company agreed to accelerate the release of
contractual restrictions on the transfer of Mr. Logue's
967,742 shares of common stock, which converts, as of a
closing scheduled on or before February 18, 1998, to
publicly traded Class A Non-Voting Common Stock. In
exchange, Mr. Logue agreed to assign 10,000 shares of his
stock to the Company.
The settlement releases 191,548 shares immediately, and
a like amount on October 29, 1998. An additional 95,774
shares will be released from restrictions on each of October
29, 1999 and October 29, 2000, with the remaining 40% of the
shares to be released in July, 2001, as originally
scheduled. The Company and Mr. Logue also clarified the
scope of Mr. Logue's continuing non-competition agreement,
negotiated a five year limitation on Mr. Logue's financial
investments in competing pawnshop businesses and negotiated
renewal options with respect to certain existing real estate
leases for store locations.
The Company is also the nominal defendant in a lawsuit
filed July 18, 1997 by a holder of thirty-nine (39) shares
of Company stock styled for the benefit of the Company
against certain directors of the Company in the Castle
County Court of Chancery in the State of Delaware. The suit
alleges the defendants breached their fiduciary duties to
the Company in approving certain management incentive
compensation arrangements and an affiliate's financial
advisory services contract with the Company. The suit seeks
recision of the subject agreements, unspecified damages and
expenses, including plaintiff's legal fees. The
defendants have filed a motion to dismiss which is pending
before the court.
Item 2. Changes in Securities
Not Applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
(a) Exhibit Incorporated by
Number Description Reference to
------- ---------------------- -----------------
Exhibit 27 Financial Data Schedule Filed herewith
(b) Reports on Form 8-K
The Company has not filed any reports on Form 8-K for
the quarter ended December 31, 1997.
<PAGE>
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.
EZCORP, INC.
------------------------------------
(Registrant)
Date: February 12, 1998 By: /s/ DAN N. TONISSEN
------------------------------------
(Signature)
Dan N. Tonissen
Senior Vice President and
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-END> DEC-31-1997
<CASH> 1,084
<SECURITIES> 0
<RECEIVABLES> 50,960
<ALLOWANCES> 0
<INVENTORY> 40,928
<CURRENT-ASSETS> 96,955
<PP&E> 56,908
<DEPRECIATION> 24,331
<TOTAL-ASSETS> 149,391
<CURRENT-LIABILITIES> 10,354
<BONDS> 0
0
0
<COMMON> 120
<OTHER-SE> 123,600
<TOTAL-LIABILITY-AND-EQUITY> 149,391
<SALES> 30,956
<TOTAL-REVENUES> 51,944
<CGS> 26,079
<TOTAL-COSTS> 47,921
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 380
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</TABLE>
