SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): April 24, 2003
First Cash Financial Services, Inc.
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
0-19133 75-2237318
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(Commission File Number) (IRS Employer Identification No.)
690 East Lamar Blvd., Suite 400, Arlington, Texas 76011
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(Address of principal executive offices, including zip code)
(817) 460-3947
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(Registrant's telephone number, including area code)
Item 1 Changes in Control of Registrant
Inapplicable
Item 2 Acquisition or Disposition of Assets
Inapplicable
Item 3 Bankruptcy or Receivership
Inapplicable
Item 4 Changes in Registrant's Certifying Accountant
Inapplicable
Item 5 Other Events
Inapplicable
Item 6 Resignation of Registrant's Directors
Inapplicable
Item 7 Financial Statements and Exhibits
(c) Exhibits.
Exhibit 99.1
Item 8 Change in Fiscal Year
Inapplicable
Item 9 Regulation FD Disclosure
First Cash Financial Services, Inc. has reported its first
quarter 2003 financial results. The Company's press release date April
24, 2003 announcing the results is attached hereto as Exhibit 99.1.
Item 12 Results of Operations and Financial Condition
First Cash Financial Services, Inc. has reported its first
quarter 2003 financial results. The Company's press release date April
24, 2003 announcing the results is attached hereto as Exhibit 99.1.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: April 24, 2003 FIRST CASH FINANCIAL SERVICES, INC.
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(Registrant)
/s/ R. DOUGLAS ORR
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R. Douglas Orr
Chief Accounting Officer
Exhibit 99.1
First Cash Financial Services Reports 25% Increase In First Quarter Net
Income; Earnings Per Share Exceed Forecast
ARLINGTON, Texas (April 24, 2003) -- First Cash Financial Services, Inc.
(Nasdaq Stock Market: "FCFS") today announced revenues, net income and
earnings per share for the three months ended March 31, 2003.
Earnings
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* Net income for the quarter ending March 31, 2003 was $3,498,000. This
represents a 25% increase over first quarter net income in 2002 of
$2,794,000.
* First quarter 2003 diluted earnings per share were $0.36, an increase
of 20% compared to $0.30 diluted earnings per share for the first
quarter of 2002. Diluted earnings per share exceeded the Company's
previous forecast of $0.34 to $0.35 per share due to higher than
projected revenues.
* Diluted earnings per share for the trailing twelve months ended March
31, 2003 were $1.20, an increase of 30% over $0.92 for the trailing
twelve months ended March 31, 2002.
Revenues
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* Total revenues for the first quarter of 2003 were $34.2 million,
compared to $28.5 million for the first quarter of 2002, an increase of
20%.
* Same store revenues for the first quarter of 2003 increased by 14% over
the comparable prior year period.
* Total revenues not including non-retail sales of scrap jewelry
merchandise increased by 15%, from $27.8 million in the first quarter
of 2002 compared to $31.9 for first quarter of 2003. Non-retail sales
of scrap jewelry merchandise increased from $677,000 in the first
quarter of 2002 to $2,388,000 in the first quarter of 2003.
Store Growth
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* The Company added eleven new stores during the first quarter of 2003,
bringing the total store count at March 31, 2003 to 201 units.
* The Company has opened 41 new stores over the past twelve months and
the total store count has increased by 22% over the same time period.
Performance Metrics & Liquidity
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* Profit margins on total merchandise sales, both retail and non-retail,
for the first quarter of 2003 were 40% which was consistent with
overall margins during the same quarter a year ago. Retail merchandise
margins, which do not include bulk jewelry scrap sales, increased from
41% to 45% over the same periods.
* Total receivables from pawn loans and short term advances increased
27%, from $19.0 million at March 31, 2002 to $24.1 at March 31, 2003.
This increase is reflective of both increased lending activities at
existing stores and growth from new locations.
* The Company utilized operating cash flows to reduce interest-bearing
debt by $11.3 million during the first three months of 2003. The
balance of the Company's line of credit was $17 million at March 31,
2003, compared to $22 million on March 31, 2002.
* Average inventory turnover for the trailing twelve months ended March
31, 2003 was 2.8, an increase over the average turn of 2.7 for the
comparable period last year.
2003 Outlook
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* Management previously forecast diluted earnings per share in a range of
$1.28 to $1.31 for 2003. Based on the results of the first quarter and
expected trends for the remainder of the year, the Company projects
that 2003 earnings will be at the upper end of the previously forecast
range.
* With eleven stores opened through March 31, the Company projects that
it will open a total of 40 to 50 stores during 2003.
Commentary & Analysis
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Rick Powell, Chairman and Chief Executive Officer of First Cash Financial
Services, commented on the Company's operating results, "The first quarter
was both a continuation of our strong performance last year and a tremendous
start toward even better results in 2003. Strong demand for our loan
products, both pawns and short-term advances, drove significant revenue
growth in our existing stores. Same store retail sales were also up for the
quarter and we achieved record first quarter margins on retail merchandise
sales. These results reflect the Company's ability to anticipate and
service strong consumer demand for its products and services and continual
attention to operating fundamentals and disciplines."
"The Company remains focused on executing its strategy for long-term growth.
During the first quarter of 2003, First Cash committed over $1.4 million of
operating cash flows into the opening of eleven new stores through funding
of leasehold improvements, equipment, working capital and start-up losses.
All start-up losses were expensed as incurred. Through its new store
openings, First Cash has made a significant investment in creating additive
revenue and profit streams for the future. At the same time, we have
managed our expansion carefully in order to ensure strong current earnings
growth. We have accomplished this by focusing our growth in high-impact
markets and by controlling our start-up expenses. We are also committed to
maintaining the diversity of our products and services and the growth is
distributed between both new pawn stores and new check cashing/short-term
advance locations."
In summarizing the first quarter results and expectations for the balance of
2003, Mr. Powell said, "We are extremely pleased with our first quarter
results. Our ability to achieve our aggressive expansion targets for the
quarter and to realize a 25% increase in net income over the prior year is
exciting. First Cash is very optimistic about its prospects for 2003 and
beyond."
Business Description
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First Cash Financial Services, Inc. is engaged in the operation of pawn
and check cashing stores, which lend money on the collateral of pledged
personal property, retail previously-owned merchandise acquired through loan
forfeitures, provide short-term loans, check cashing and other financial
services. The Company owns and operates 202 pawn and check cashing/short-
term advance stores in eleven states and Mexico. First Cash Financial
Services is also an equal partner in Cash & Go, Ltd., a joint venture, which
owns and operates financial services kiosks located inside convenience
stores. Its common stock is traded on the Nasdaq Stock Market under the
ticker symbol "FCFS".
Forward-Looking Statements
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This release may contain forward-looking statements about the business,
financial condition and prospects of First Cash Financial Services, Inc.
Forward-looking statements can be identified by the use of forward-looking
terminology such as "believes," "projects," "expects," "may," "estimates,"
"will," "should," "plans," "intends," or "anticipates" or the negative
thereof, or other variations thereon, or comparable terminology, or by
discussions of strategy. Forward-looking statements in this annual report
include, without limitation, the earnings per share discussion, the
expectation of increased pawn growth, the expectation for additional store
openings, and the expectation of growth in the Company's short-term advance
products. These statements are made to provide the public with management's
assessment of the Company's business. Although the Company believes that
the expectations reflected in forward-looking statements are reasonable,
there can be no assurances that such expectations will prove to be accurate.
Security holders are cautioned that such forward-looking statements involve
risks and uncertainties. The forward-looking statements contained in this
report speak only as of the date of this report, and the Company expressly
disclaims any obligation or undertaking to release any updates or revisions
to any such statement to reflect any change in the Company's expectations or
any change in events, conditions or circumstance on which any such statement
is based. Certain factors may cause results to differ materially from those
anticipated by some of the statements made in this report. Such factors are
difficult to predict and many are beyond the control of the Company, but may
include changes in regional or national economic conditions, the ability
to integrate new stores, the ability to maintain favorable banking
relationships as it relates to short-term lending products, changes in
governmental regulations, unforeseen litigation, changes in interest rates
or tax rates, changes in gold prices, future business decisions and other
uncertainties.
SELECTED OPERATING INFORMATION
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Quarter Ended
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March 31, March 31,
2003 2002
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(unaudited)
(in thousands, except per share)
Revenues:
Merchandise sales ............... $ 17,153 $ 14,755
Service charges ................. 16,013 12,745
Check cashing fees .............. 772 731
Other ........................... 306 220
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34,244 28,451
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Cost of goods sold................. 10,347 8,910
Operating expenses................. 13,911 12,035
Interest expense................... 182 255
Interest income.................... (183) (149)
Depreciation....................... 662 555
Administrative expenses............ 3,734 2,480
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28,653 24,086
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Income before income taxes......... 5,591 4,365
Provision for income taxes......... 2,093 1,571
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Net income......................... $ 3,498 $ 2,794
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Net income per share:
Basic ........................... $ 0.39 $ 0.32
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Diluted ......................... $ 0.36 $ 0.30
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CONDENSED BALANCE SHEETS
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March 31,
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2003 2002
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(unaudited)
(in thousands)
ASSETS:
Cash & cash equivalents............ $ 13,106 $ 12,002
Receivables........................ 24,119 19,020
Inventories........................ 12,330 10,812
Other current assets............... 3,766 3,255
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Total current assets ............ 53,321 45,089
Property & equipment, net.......... 11,963 10,151
Intangible assets, net............. 53,194 53,194
Other ............................. 5,477 6,485
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$ 123,955 $ 114,919
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LIABILITIES & STOCKHOLDERS' EQUITY:
Revolving credit facility.......... $ - $ 22,000
Accounts payable and other current
liabilities...................... 11,037 10,862
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Total current liabilities ....... 11,037 32,862
Revolving credit facility.......... 17,000 -
Long-term debt, net of current
portion.......................... 575 1,283
Deferred taxes payable............. 5,223 3,910
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Total liabilities ............... 33,835 38,055
Stockholders' Equity............... 90,120 76,864
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$ 123,955 $ 114,919
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For further information, please contact:
Rick Wessel, President
Doug Orr, Chief Financial Officer
Phone:(817) 460-3947
Email: investorrelations@firstcash.com
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Website: www.firstcash.com
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