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
February 28, 2006
(Date of Report - Date of Earliest Event Reported)
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First Cash Financial Services, Inc. |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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(State or other jurisdiction of incorporation) |
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0-19133 |
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75-2237318 |
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(Commission File Number) |
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(IRS Employer Identification No.) |
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690 East Lamar Blvd., Suite 400, Arlington, Texas 76011 |
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(Address of principal executive offices, including zip code) |
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(817) 460-3947 |
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(Registrant’s telephone number, including area code) |
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Item 8.01 Other Events
First Cash Financial Services, Inc. has made available on its corporate website (www.firstcash.com) its most recent investor presentation and a slideshow of new store locations in Mexico. These presentations are included herein as Exhibits 99.1 and 99.2.
The information provided in this Item 8.01 shall not be deemed “filed” for purposes of the Securities Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by the specific reference in such filing.
Item 9.01 Financial Statements and Exhibits
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(d) |
Exhibits: |
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99.1 |
First Cash Financial Services, Inc. Investor Presentation |
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99.2 |
First Cash Financial Services, Inc. Mexico Store Slideshow |
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.
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Dated: February 28, 2006 |
FIRST CASH FINANCIAL SERVICES, INC. |
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(Registrant) |
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/s/ R. DOUGLAS ORR |
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R. Douglas Orr |
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Chief Accounting Officer |
EXHIBIT INDEX
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Exhibit Number |
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Document |
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99.1 |
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99.2 |
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Exhibit 99.1
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[LOGO OF FIRST CASH]
INVESTOR PRESENTATION - FEBRUARY/MARCH 2006
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Certain statements included in this presentation which are not historical in nature, including statements regarding the Company’s and/or management’s strategies, beliefs, expectations, plans for new stores, projections of earnings and revenues, expected effect of regulatory pronouncements, potential legislation, or other predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and are intended to be covered by the Safe Harbor provisions for forward-looking statements contained in such Act. |
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Forward-looking statements are made based on assumptions involving certain known and unknown risks and uncertainties, many of which are beyond the Company’s control, and other important factors that could cause actual results, performance or achievements to differ materially from expectations expressed or implied by such forward-looking statements. These risk factors and uncertainties are listed from time to time in the Company’s filings with the Securities and Exchange Commission, including, but not limited to, our annual reports on Form 10-K for the years ending December 31, 2003 and 2004, our reports on Form 10-Q for the periods ended March 31, 2005, June 30, 2005 and September 30, 2005 and on various Form 8-K filings in 2005 and 2006. |
FIRST CASH FINANCIAL SERVICES
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Leading provider of diversified specialty consumer finance products |
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Superior earnings performance and financial position |
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Significant future growth through store expansion |
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[GRAPHIC APPEARS HERE] |
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FIRST CASH FINANCIAL SERVICES
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1988 |
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Founded – 3 pawn stores in Texas |
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Early 90’s |
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Goes public; multi-state pawn store roll-up acquisitions |
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Late 90’s |
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Payday lending acquisitions; introduction of payday product in pawn stores |
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[GRAPHIC APPEARS HERE] |
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First pawn stores opened in Mexico |
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2001 to present |
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Expansion through new store openings: U.S. payday & Mexico pawn |
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2005 |
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Introduction of credit services product |
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
Geographic Markets & Product Offerings
As of December 31, 2005
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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Short-term loan secured by pledged personal property |
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No credit check |
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No bank account required |
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Regulations vary by state - typically provide for: |
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30 day term |
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10% to 20% monthly service fee |
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
Loan Growth
[CHART APPEARS HERE]
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Many un-banked or under-banked customers |
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Both in the U.S. and… |
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In Mexico, where: |
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88% of retail transactions are in cash |
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An estimated 80% of the population is un-banked |
FIRST CASH FINANCIAL SERVICES
Composition of Retail Inventories
[CHART APPEARS HERE]
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Retail inventories are primarily acquired via forfeited pawn loan collateral |
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Gold jewelry represents 53% of the retail inventory |
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Retail Metrics for 2005 |
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Total merchandise margins |
40% |
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Retail margins (excludes scrap jewelry sales) |
44% |
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Inventory turns |
3.2x |
FIRST CASH FINANCIAL SERVICES
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Typical advance amount: $100 to $500 |
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Term: 7 to 31 days |
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Typical service charge per advance: 15% |
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Proof of employment and bank account required – but no credit check |
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Advance secured by personal check held until due date |
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
Payday Advance Regulatory Landscape
FDIC regulations affect only payday lending in other states where “bank model” is used
First Cash does not utilize the bank model in any state and is therefore not subject to FDIC regulations
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
Credit Services Model Utilized in Texas
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In Texas, First Cash has elected to operate as a Credit Services Organization (“CSO”) |
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As a CSO, First Cash provides customers access to a short-term loan funded by an independent consumer lending company |
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Customer pays a fee to CSO for its services: |
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processing of application with lender |
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providing letter of credit |
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disbursement and collection of lender funds |
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Customer pays interest to lender (at less than 10% APR) |
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FIRST CASH FINANCIAL SERVICES
Superior Performance & Financial Position
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Operating Results |
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Industry leading performance metrics |
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Consistent growth |
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Increasing margins |
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Financial Position |
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Debt-free |
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Strong cash flows |
Revenues
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
2005 - Fourth Quarter Highlights
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20th consecutive quarter of double-digit EPS growth |
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Q4 diluted EPS up 31% over prior year |
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Fiscal 2005 performance |
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Revenues of $208 million |
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Diluted EPS of $0.76*, up 25% |
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Net income of $25 million, up 23% |
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* - Reflects two-for-one stock split effective February 22, 2006 |
Net Income
(From Continuing Operations)
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
Reflects two-for-one stock split effective February 22, 2006
FIRST CASH FINANCIAL SERVICES
Consistency of Growth & Earnings
Trailing 12 Months
Diluted Earnings per Share
[CHART APPEARS HERE]
Reflects two-for-one stock split effective February 22, 2006
[LOGO OF FORBES]
Forbes 200 Best Small Companies
4 straight years
[LOGO OF FORTUNE SMALL BUSINESS]
Fortune Small Business 100
2 straight years
FIRST CASH FINANCIAL SERVICES
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Annual EPS growth in excess of 20% recorded for the past five years |
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60 to 70 new store openings projected for 2006 |
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2006 earnings per share forecast of $0.91 to $0.93* |
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Midpoint represents 21% increase over 2005 EPS |
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* - Reflects two-for-one stock split effective February 22, 2006 |
FIRST CASH FINANCIAL SERVICES
Increasing Market Visibility & Liquidity
Two-for-one stock split effective February 22, 2006
Market Cap
[CHART APPEARS HERE]
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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All store openings funded from current cash flows |
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Loan growth at new & existing stores |
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Capital expenditures for new stores |
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Start-up costs for new stores |
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Stock repurchases of $24 million over past two years |
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[GRAPHIC APPEARS HERE] |
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FIRST CASH FINANCIAL SERVICES
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New store openings in multiple markets |
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United States |
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Mexico |
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Diversified product line |
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Pawn loans & related retail |
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Payday advances |
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Credit services |
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[CHART APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
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Cap Ex |
$80,000 to $150,000 |
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- Leasehold improvements |
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- Computer & security equipment |
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Working Capital (first year) |
$80,000 to $150,000 |
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- Operating cash |
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- Loan funding |
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- Inventory (pawn only) |
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Start-up Losses |
$40,000 to $60,000 |
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- Pre-opening |
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- First six months of operation |
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Totals |
$200,000 to $360,000 |
FIRST CASH FINANCIAL SERVICES
[GRAPHIC APPEARS HERE]
FIRST CASH FINANCIAL SERVICES
[GRAPHICS APPEAR HERE]
FIRST CASH FINANCIAL SERVICES
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Continued growth in key Texas markets: |
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Dallas/Fort Worth |
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Houston |
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San Antonio/Austin |
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Many other mid-sized markets |
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First stores in Michigan projected in Q2 of 2006 |
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Monitoring opportunities for expansion in other states with favorable payday laws |
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FIRST CASH FINANCIAL SERVICES
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Industry leader in a growth sector |
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Strong demand for specialty consumer finance products |
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Multiple products: pawn and payday advance |
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Superior financial metrics |
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20 consecutive quarters (five years) of double-digit EPS growth |
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Strong cash flows; no debt |
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Well-defined expansion strategy will drive continued growth |
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Significant headroom for new stores in multiple markets |
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20% increase in store count targeted for 2006 |
FIRST CASH FINANCIAL SERVICES
[LOGO OF FIRST CASH]
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Investor contact information: |
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Phone: |
817.505.3199 |
[LOGO OF FCFS] |
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Email: |
investorrelations@firstcash.com |
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Website: www.firstcash.com |
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Exhibit 99.2
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