FirstCash(FCFS) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION This section details the company's unaudited financial statements and management's analysis of financial performance and condition Item 1. Financial Statements (Unaudited) This section presents the company's unaudited consolidated financial statements, including balance sheets, income statements, and cash flows, with detailed notes on accounting policies and segment information Consolidated Balance Sheets This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity | Metric | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------------------- | :--------------------------- | :--------------------------- | :------------- | | Total Assets | $4,514,249 | $4,322,408 | 4.4% | | Pawn Loans | $550,718 | $491,731 | 12.0% | | Finance Receivables, net | $154,518 | $105,401 | 46.6% | | Inventories | $355,733 | $315,424 | 12.8% | | Leased Merchandise, net | $100,689 | $142,935 | -29.6% | | Total Liabilities | $2,374,081 | $2,343,959 | 1.3% | | Total Stockholders' Equity | $2,140,168 | $1,978,449 | 8.2% | Consolidated Statements of Income This section presents the company's financial performance over a period, detailing revenues, expenses, and net income | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | :----------------------- | :------------------------------------------ | :------------------------------------------ | :------------- | | Total Revenue | $830,622 | $831,012 | -0.05% | | Net Income | $59,805 | $49,073 | 21.9% | | Diluted EPS | $1.34 | $1.08 | 24.1% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | Total Revenue | $1,667,045 | $1,667,382 | -0.02% | | Net Income | $143,396 | $110,441 | 29.8% | | Diluted EPS | $3.21 | $2.44 | 31.6% | Consolidated Statements of Comprehensive Income This section details net income and other comprehensive income components, reflecting the total change in equity from non-owner sources | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------------- | :------------------------------------------ | :------------------------------------------ | :------------- | | Net Income | $59,805 | $49,073 | 21.9% | | Currency Translation Adjustment | $34,273 | $(47,664) | N/A | | Comprehensive Income | $94,078 | $1,409 | 6599.6% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | Net Income | $143,396 | $110,441 | 29.8% | | Currency Translation Adjustment | $33,329 | $(41,329) | N/A | | Comprehensive Income | $176,725 | $69,112 | 155.7% | Consolidated Statements of Changes in Stockholders' Equity This section outlines the changes in the company's equity components, including net income, dividends, and stock transactions | Metric | As of 12/31/2024 (in thousands) | As of 6/30/2025 (in thousands) | Change (in thousands) | | :-------------------------------- | :------------------------------ | :----------------------------- | :-------------------- | | Total Stockholders' Equity | $2,054,164 | $2,140,168 | $85,904 | | Six Months Ended June 30, 2025 (in thousands) | | | | | Net Income | | $143,396 | | | Cash Dividends Paid | | $(33,802) | | | Purchases of Treasury Stock | | $(60,205) | | | Currency Translation Adjustment | | $34,273 | | Consolidated Statements of Cash Flows This section summarizes the cash inflows and outflows from operating, investing, and financing activities over a period | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------------------- | :------------------------------------------ | :------------------------------------------ | :------------- | | Net Cash Flow Provided by Operating Activities | $243,494 | $228,719 | 6.4% | | Net Cash Flow Used in Investing Activities | $(174,210) | $(187,864) | -7.3% | | Net Cash Flow Used in Financing Activities | $(146,025) | $(50,850) | 187.2% | | Cash and Cash Equivalents at End of Period | $101,467 | $113,693 | -10.8% | Notes to Consolidated Financial Statements This section provides detailed explanations of the accounting policies, significant estimates, and specific line items presented in the consolidated financial statements Note 1 - General This section outlines the general accounting policies and basis of presentation for the financial statements - The unaudited consolidated financial statements are prepared in accordance with U.S. GAAP for interim financial information and include accounts of FirstCash Holdings, Inc. and its wholly-owned subsidiaries, with acquisitions consolidated since their dates[34][35] - Latin American pawn operations (Mexico, Guatemala, Colombia) use local functional currencies, with assets and liabilities translated at balance sheet date exchange rates and revenues/expenses at average rates, impacting other comprehensive income (loss)[36] - The company is evaluating ASU 2024-03 (Expense Disaggregation Disclosures), effective for fiscal years beginning after December 15, 2026, but does not expect ASU 2023-09 (Income Tax Disclosures) to have a material effect[39][40][41] Note 2 - Earnings Per Share This section details the calculation of basic and diluted earnings per share | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change (%) | | :------------------------------------------ | :------------------------------- | :------------------------------- | :------------- | | Diluted Earnings Per Share | $1.34 | $1.08 | 24.1% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change (%) | | Diluted Earnings Per Share | $3.21 | $2.44 | 31.6% | | Weighted-Average Common Shares for Diluted EPS | 44,670 thousand | 45,338 thousand | -1.5% | Note 3 - Acquisitions This section provides details on the company's business acquisitions during the period - On May 14, 2025, the Company agreed to acquire H&T Group plc, the leading pawn operator in the United Kingdom with 285 stores, for an approximate total equity value of £291.4 million ($396.3 million USD), with the acquisition expected to close in Q3 2025, subject to FCA approvals[43][44] - During the six months ended June 30, 2025, the Company acquired four U.S. pawn stores for an aggregate purchase price of $33.0 million, net of cash acquired, recording goodwill for the excess purchase price over net assets[45][46] Note 4 - Operating Leases This section provides information on the company's operating lease arrangements - The Company leases most of its pawnshop locations and administrative offices under operating leases, with a weighted-average remaining lease term of 4.2 years as of June 30, 2025, and a weighted-average discount rate of 8.5%[48][49][50] - Foreign currency remeasurement of U.S. dollar-denominated Mexican operating leases resulted in a foreign currency gain of $1.6 million for the three months ended June 30, 2025, and $1.5 million for the six months ended June 30, 2025[51] | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | :------------------------ | :------------------------------------------ | :------------------------------------------ | :------------- | | Total Operating Lease Expense | $41,501 | $42,560 | -2.5% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | Total Operating Lease Expense | $80,934 | $84,500 | -4.2% | Note 5 - Fair Value of Financial Instruments This section details the fair value measurements of financial assets and liabilities - The Company did not have any financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2025, and no impairment events for non-financial assets were identified during the six months ended June 30, 2025[54][55] | Financial Asset/Liability | Carrying Value (June 30, 2025, in thousands) | Estimated Fair Value (June 30, 2025, in thousands) | Fair Value Level | | :-------------------------------- | :------------------------------------------- | :------------------------------------------- | :--------------- | | Cash and cash equivalents | $101,467 | $101,467 | Level 1 | | Accounts receivable, net | $76,062 | $76,062 | Level 3 | | Pawn loans | $550,718 | $550,718 | Level 3 | | Finance receivables, net | $154,518 | $313,281 | Level 3 | | Revolving unsecured credit facilities | $152,000 | $152,000 | Level 2 | | Senior unsecured notes (outstanding principal) | $1,550,000 | $1,548,000 | Level 2 | Note 6 - Finance Receivables, Net This section provides details on finance receivables, including allowances for loan losses and delinquency information | Metric | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------------- | :--------------------------- | :--------------------------- | :------------- | | Finance receivables, net | $154,518 | $105,401 | 46.6% | | Allowance for loan losses | $122,874 | $99,961 | 23.0% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | Provision for loan losses | $78,121 | $61,534 | 27.0% | | Charge-offs | $(78,497) | $(62,092) | 26.4% | | Recoveries | $6,245 | $4,065 | 53.6% | | Delinquency (as of June 30, 2025, in thousands) | 2025 Origination Year | 2024 Origination Year | 2023 Origination Year | Total | | :-------------------------------- | :-------------------- | :-------------------- | :-------------------- | :------ | | 1 to 30 days past due | $17,683 | $9,968 | $489 | $28,140 | | 31 to 60 days past due | $9,946 | $6,998 | $348 | $17,292 | | 61 to 89 days past due | $6,189 | $5,853 | $321 | $12,363 | | Total past due finance receivables | $33,818 | $22,819 | $1,158 | $57,795 | Note 7 - Leased Merchandise, Net This section provides information on leased merchandise, including allowances for lease losses | Metric | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------------- | :--------------------------- | :--------------------------- | :------------- | | Leased merchandise, net | $100,689 | $142,935 | -29.6% | | Allowance for lease losses | $69,667 | $102,778 | -32.2% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | Provision for lease losses | $60,105 | $90,663 | -33.7% | | Charge-offs | $(75,007) | $(86,679) | -13.5% | | Recoveries | $4,312 | $3,667 | 17.6% | Note 8 - Long-Term Debt This section details the company's long-term debt obligations, including credit facilities and senior unsecured notes | Debt Type | As of June 30, 2025 (in thousands) | As of June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------------------- | :--------------------------------- | :--------------------------------- | :------------- | | Revolving unsecured credit facilities | $152,000 | $150,000 | 1.3% | | Senior unsecured notes | $1,532,865 | $1,529,870 | 0.2% | | Total long-term debt | $1,684,865 | $1,679,870 | 0.3% | - The Company's $700.0 million Credit Facility, maturing August 8, 2029, had $152.0 million outstanding and $545.3 million available as of June 30, 2025, with a weighted-average interest rate of 6.82%[65][67][69] - The Credit Facility was amended on May 13, 2025, to modify financial covenants, including an increased non-loan party investment basket to 25% of net worth and an increased permitted consolidated leverage ratio to 3.75x adjusted EBITDA through December 31, 2025, in anticipation of the H&T Acquisition[66] - The Company's consolidated total debt ratio was 2.5 to 1 as of June 30, 2025, which is below the covenant limits for its senior unsecured notes (2.75 to 1 for 2028 Notes, 3.0 to 1 for 2030 and 2032 Notes)[72][73][75] Note 9 - Commitments and Contingencies This section provides information on the company's legal and contractual commitments and potential liabilities - The Company settled a civil action with the CFPB on July 11, 2025, regarding Military Lending Act violations, agreeing to offer a new pawn lending product for military members, pay up to $7.0 million in consumer redress, and a $4.0 million civil monetary penalty, with an $11.0 million accrual made in Q2 2025[78] - The pending H&T Acquisition has an equity value of approximately $396.3 million USD, and H&T had $98.7 million USD in outstanding indebtedness as of June 30, 2025, with the Company intending to finance the acquisition using its Credit Facility[79][80] - As of June 30, 2025, the Company had contractual commitments to deliver 72,500 gold ounces between July 2025 and June 2027 at a weighted-average price of $2,826 per ounce[81] Note 10 - Segment Information This section presents financial data broken down by the company's operating segments - The Company operates in three reportable segments: U.S. pawn, Latin America pawn, and Retail POS payment solutions (American First Finance 'AFF')[84] | Segment (Three Months Ended June 30, 2025, in thousands) | Total Revenue | Segment Pre-Tax Operating Income | | :----------------------------------------- | :------------ | :------------------------------- | | U.S. Pawn | $409,606 | $98,286 | | Latin America Pawn | $205,906 | $40,980 | | Retail POS Payment Solutions | $215,859 | $37,939 | | Segment (Six Months Ended June 30, 2025, in thousands) | Total Revenue | Segment Pre-Tax Operating Income | | U.S. Pawn | $832,271 | $211,418 | | Latin America Pawn | $390,034 | $72,385 | | Retail POS Payment Solutions | $446,190 | $90,240 | | Segment Assets (As of June 30, 2025, in thousands) | Pawn Loans | Finance Receivables, net | Inventories | Leased Merchandise, net | Goodwill | Total Assets | | :----------------------------------- | :--------- | :----------------------- | :---------- | :---------------------- | :--------- | :----------- | | U.S. Pawn | $400,143 | — | $252,885 | — | $1,154,790 | $2,746,362 | | Latin America Pawn | $150,575 | — | $102,848 | — | $185,189 | $722,882 | | Retail POS Payment Solutions | — | $154,518 | — | $100,852 | $486,205 | $901,034 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides a comprehensive analysis of the company's financial condition, results of operations, liquidity, and capital resources, including segment-specific performance and critical accounting estimates GENERAL This section provides an overview of the company's business model and operations - FirstCash Holdings, Inc. primarily operates retail pawn stores in the U.S. and Latin America, serving cash- and credit-constrained consumers through non-recourse pawn loans and merchandise sales[90] - The company also provides technology-driven retail POS payment solutions through American First Finance (AFF), offering lease-to-own (LTO) products and retail financing across a network of merchant partners[91] - The company's operations are organized into three reportable segments: U.S. pawn, Latin America pawn, and retail POS payment solutions, with a pending acquisition of H&T Group plc in the UK expected to close in Q3 2025[92][93] OPERATIONS AND LOCATIONS This section details the company's store count and operational footprint across its various segments | Pawn Store Activity | Six Months Ended June 30, 2025 | | :-------------------------------- | :----------------------------- | | Total locations, beginning of period | 3,026 | | New locations opened | 21 | | Locations acquired | 4 | | Consolidation of existing pawn locations | (24) | | Total locations, end of period | 3,027 | - As of June 30, 2025, the Company operated 3,027 pawn store locations, including 1,194 in the U.S. and 1,833 in Latin America[94][95] - AFF's retail POS payment solutions network expanded to approximately 15,300 active merchant partner locations as of June 30, 2025, up from 12,800 at June 30, 2024[96] CRITICAL ACCOUNTING ESTIMATES This section discusses the key judgments and assumptions used in the company's financial reporting - There have been no changes to the Company's significant accounting policies for the six months ended June 30, 2025, as previously reported in its 2024 Annual Report on Form 10-K[97] RESULTS OF OPERATIONS (unaudited) This section provides an analysis of the company's financial performance for the reported periods Operating Results for the Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024 This section compares the company's operating results for the second quarter of 2025 against the same period in 2024 U.S. Pawn Segment This section analyzes the performance of the U.S. pawn operations for the second quarter | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Increase (%) | | :-------------------------- | :--------------------- | :--------------------- | :--------------- | | Total Revenue | $409,606 | $376,736 | 9% | | Retail Merchandise Sales | $249,918 | $230,093 | 9% | | Pawn Loan Fees | $130,948 | $120,332 | 9% | | Wholesale Scrap Jewelry Sales | $28,740 | $26,311 | 9% | | Segment Pre-Tax Operating Income | $98,286 | $90,595 | 8% | | Segment Pre-Tax Operating Margin | 24% | 24% | 0% | | Pawn Loans (as of June 30) | $400,143 | $356,342 | 12% | | Inventories (as of June 30) | $252,885 | $223,428 | 13% | - Same-store retail sales increased 7% and same-store pawn loan fees increased 9% in Q2 2025, driven by strong demand for value-priced merchandise, increased inventory levels, and higher gold prices[101][103][104] - U.S. operating expenses increased 7% to $133.8 million, primarily due to increased labor and variable compensation expenses[105] Latin America Pawn Segment This section analyzes the performance of the Latin America pawn operations for the second quarter - Latin American segment results were impacted by a 13% unfavorable change in the average value of the Mexican peso compared to the U.S. dollar in Q2 2025[108] | Metric (Constant Currency) | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Increase (%) | | :-------------------------------- | :--------------------- | :--------------------- | :--------------- | | Total Revenue | $230,807 | $203,982 | 13% | | Retail Merchandise Sales | $153,234 | $134,445 | 14% | | Pawn Loan Fees | $67,497 | $60,714 | 11% | | Segment Pre-Tax Operating Income | $45,211 | $37,113 | 22% | | Segment Pre-Tax Operating Margin | 20% | 18% | 2% | | Pawn Loans (as of June 30) | $154,466 | $135,389 | 14% | | Inventories (as of June 30) | $105,501 | $91,996 | 15% | - Constant currency same-store retail sales increased 13% and same-store pawn loan fees increased 11%, driven by strong demand, larger loan sizes, and higher gold prices[112][114][115] - Operating expenses increased 7% on a constant currency basis due to increased store counts, inflation, and minimum wage increases[116] Retail POS Payment Solutions Segment This section analyzes the performance of the retail point-of-sale payment solutions segment for the second quarter | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YoY Change (%) | | :-------------------------------- | :--------------------- | :--------------------- | :--------------- | | Total Revenue | $215,859 | $251,369 | -14% | | Leased Merchandise Income | $139,784 | $194,570 | -28% | | Interest and Fees on Finance Receivables | $76,075 | $56,799 | 34% | | Segment Pre-Tax Operating Income | $37,939 | $25,909 | 46% | | Leased Merchandise, net (as of June 30) | $100,852 | $143,156 | -30% | | Finance Receivables, net (as of June 30) | $154,518 | $105,401 | 47% | | Total Gross Transaction Volume | $260,459 | $252,036 | 3% | | Provision for Lease Losses | $32,667 | $47,824 | -32% | | Provision for Loan Losses | $41,761 | $31,116 | 34% | | Operating Expenses | $24,264 | $35,275 | -31% | - Leased merchandise income decreased due to reduced originations following bankruptcies of major merchant partners (A-Freight and Conn's), while interest and fees on finance receivables increased due to higher balances and expansion into non-furniture verticals[122][124][127][129] - Operating expenses decreased 31% due to the elimination of expenses associated with the A-Freight and Conn's relationships, along with operating synergies and cost reduction initiatives[131] Consolidated Results of Operations This section summarizes the overall financial performance for the second quarter | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | | :-------------------------------- | :--------------------- | :--------------------- | | Consolidated Segment Pre-Tax Operating Income | $177,239 | $153,701 | | Income Before Income Taxes | $81,079 | $66,178 | | Net Income | $59,805 | $49,073 | Corporate Expenses and Taxes This section analyzes corporate overhead and tax impacts for the second quarter - Administrative expenses increased 27% to $59.3 million, primarily due to an $11.0 million CFPB litigation settlement accrued in Q2 2025 and general inflationary impacts, partially offset by Mexican peso depreciation[134] - Merger and acquisition expenses increased 104% to $2.8 million, primarily due to expenses associated with the H&T Acquisition[136] - The consolidated effective income tax rate was 26.2% in Q2 2025, compared to 25.8% in Q2 2024, with no material impact expected from the OBBBA in 2025[137] Operating Results for the Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024 This section compares the company's operating results for the first half of 2025 against the same period in 2024 U.S. Pawn Segment This section analyzes the performance of the U.S. pawn operations for the first half of the year | Metric | H1 2025 (in thousands) | H1 2024 (in thousands) | YoY Increase (%) | | :-------------------------- | :--------------------- | :--------------------- | :--------------- | | Total Revenue | $832,271 | $754,426 | 10% | | Retail Merchandise Sales | $501,143 | $467,083 | 7% | | Pawn Loan Fees | $268,896 | $243,306 | 11% | | Wholesale Scrap Jewelry Sales | $62,232 | $44,037 | 41% | | Segment Pre-Tax Operating Income | $211,418 | $187,197 | 13% | | Segment Pre-Tax Operating Margin | 25% | 25% | 0% | - Same-store retail sales increased 5% and same-store pawn loan fees increased 9% in H1 2025, driven by continued strong demand for value-priced merchandise, increased inventory levels, and higher pawn loan balances[141][142] - U.S. operating expenses increased 8% to $262.8 million, primarily due to increased labor and variable compensation expenses[143] Latin America Pawn Segment This section analyzes the performance of the Latin America pawn operations for the first half of the year - Latin American segment results were impacted by a 17% unfavorable change in the average value of the Mexican peso compared to the U.S. dollar in H1 2025[146] | Metric (Constant Currency) | H1 2025 (in thousands) | H1 2024 (in thousands) | YoY Increase (%) | | :-------------------------------- | :--------------------- | :--------------------- | :--------------- | | Total Revenue | $448,391 | $400,622 | 12% | | Retail Merchandise Sales | $296,887 | $265,294 | 12% | | Pawn Loan Fees | $131,755 | $117,275 | 12% | | Segment Pre-Tax Operating Income | $81,718 | $69,017 | 18% | | Segment Pre-Tax Operating Margin | 18% | 17% | 1% | | Operating Expenses | $144,841 | $135,327 | 7% | - Constant currency same-store retail sales increased 11% and same-store pawn loan fees increased 12%, driven by strong demand for merchandise and increased pawn receivables[149][150] - Operating expenses increased 7% on a constant currency basis due to increased store counts, inflation, and minimum wage increases[151] Retail POS Payment Solutions Segment This section analyzes the performance of the retail point-of-sale payment solutions segment for the first half of the year | Metric | H1 2025 (in thousands) | H1 2024 (in thousands) | YoY Change (%) | | :-------------------------------- | :--------------------- | :--------------------- | :--------------- | | Total Revenue | $446,190 | $514,427 | -13% | | Leased Merchandise Income | $296,702 | $400,241 | -26% | | Interest and Fees on Finance Receivables | $149,488 | $114,186 | 31% | | Segment Pre-Tax Operating Income | $90,240 | $59,058 | 53% | | Total Gross Transaction Volume | $496,027 | $508,321 | -2% | | Provision for Lease Losses | $60,271 | $91,004 | -34% | | Provision for Loan Losses | $78,121 | $61,534 | 27% | | Operating Expenses | $48,482 | $70,091 | -31% | - Leased merchandise income decreased due to lower average leased merchandise balances, while interest and fees on finance receivables increased due to higher balances and expansion into services sector verticals[156][159] - Operating expenses decreased 31% due to the elimination of expenses associated with the A-Freight and Conn's relationships, along with operating synergies and cost reduction initiatives[161] Consolidated Results of Operations This section summarizes the overall financial performance for the first half of the year | Metric | H1 2025 (in thousands) | H1 2024 (in thousands) | | :-------------------------------- | :--------------------- | :--------------------- | | Consolidated Segment Pre-Tax Operating Income | $374,115 | $315,566 | | Income Before Income Taxes | $192,296 | $148,063 | | Net Income | $143,396 | $110,441 | Corporate Expenses and Taxes This section analyzes corporate overhead and tax impacts for the first half of the year - Administrative expenses increased 19% to $107.8 million, primarily due to the $11.0 million CFPB litigation settlement and general inflationary impacts, partially offset by Mexican peso depreciation[164] - Merger and acquisition expenses increased 65% to $3.2 million, primarily due to expenses associated with the H&T Acquisition[167] - The consolidated effective income tax rate was 25.4% for both H1 2025 and H1 2024, with no material impact expected from the OBBBA in 2025[167] LIQUIDITY AND CAPITAL RESOURCES This section discusses the company's ability to generate and manage cash, including its capital requirements and financing strategies - The Company's primary capital requirements include expanding pawn operations (growth, new stores, acquisitions), expanding retail POS payment solutions, and returning capital to shareholders through dividends and stock repurchases[168][173] - During H1 2025, the Company acquired four U.S. pawn stores for $33.0 million, opened 21 new stores, and purchased real estate at 21 store locations for $28.1 million, with the pending H&T Acquisition (equity value $396.3 million USD) to be financed by the Credit Facility[170][171][174] | Liquidity Metric | As of June 30, 2025 (in thousands) | As of June 30, 2024 (in thousands) | | :------------------------------------------ | :--------------------------------- | :--------------------------------- | | Cash and cash equivalents | $101,467 | $113,693 | | Available and unused funds under credit facilities | $545,300 | N/A | | Working capital | $1,048,126 | $957,690 | | Current ratio | 4.2:1 | 4.0:1 | | Cash Flow (Six Months Ended June 30, in thousands) | 2025 | 2024 | | Cash flow provided by operating activities | $243,494 | $228,719 | | Cash flow used in investing activities | $(174,210) | $(187,864) | | Cash flow used in financing activities | $(146,025) | $(50,850) | - The Company repurchased 525,000 shares for $59.6 million in H1 2025, with $55.4 million remaining under its $200.0 million repurchase program, and a $0.42 per share Q3 cash dividend was declared[176][177][178] GOVERNMENTAL REGULATION UPDATE This section provides updates on regulatory developments affecting the company's operations - The CFPB's small-dollar lending (SDL) rule went into effect on March 30, 2025, but enforcement is not a priority, and the agency may seek new rulemaking to narrow its scope, with the Company not expecting a material impact on its future results[190] - No material changes to the Company's risk factors or significant regulations affecting its businesses have occurred since the 2024 Annual Report on Form 10-K[188][207] - Potential new tariffs, quotas, and trade barriers could depress economic activity and adversely affect consumers, but the nature, timing, and economic effects remain uncertain[191] NON-GAAP FINANCIAL INFORMATION This section presents non-GAAP financial measures used by management to evaluate operating performance, excluding certain non-operating items - The Company uses non-GAAP financial measures (adjusted net income, adjusted diluted EPS, EBITDA, adjusted EBITDA, free cash flow, adjusted free cash flow, and constant currency results) to evaluate operating performance by excluding non-operating items like M&A expenses, AFF intangible asset amortization, and the CFPB litigation settlement[192][193] Adjusted Net Income and Adjusted Diluted Earnings Per Share This section presents adjusted net income and adjusted diluted earnings per share, excluding specific non-recurring or non-cash items | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change (%) | | :------------------------------------------ | :------------------------------- | :------------------------------- | :------------- | | Adjusted Diluted Earnings Per Share | $1.79 | $1.37 | 30.7% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change (%) | | Adjusted Diluted Earnings Per Share | $3.86 | $2.91 | 32.6% | - Key adjustments for the six months ended June 30, 2025, include $2.5 million for merger and acquisition expenses (net of tax), $18.5 million for amortization of acquired AFF intangible assets (net of tax), and $9.4 million for the CFPB litigation settlement (net of tax)[195] Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA This section provides EBITDA and Adjusted EBITDA, which are non-GAAP measures used to assess operational profitability before certain non-operating expenses | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | :---------------- | :------------------------------------------ | :------------------------------------------ | :------------- | | EBITDA | $295,714 | $250,238 | 18.2% | | Adjusted EBITDA | $308,009 | $253,474 | 21.5% | | Trailing Twelve Months Adjusted EBITDA | $612,972 | $548,163 | 11.8% | - Adjustments for the six months ended June 30, 2025, include $3.2 million for merger and acquisition expenses and $11.0 million for the CFPB litigation settlement[196] Free Cash Flow and Adjusted Free Cash Flow This section presents free cash flow and adjusted free cash flow, indicating the cash available for discretionary purposes after capital expenditures | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | YoY Change (%) | | :-------------------- | :------------------------------------------ | :------------------------------------------ | :------------- | | Free Cash Flow | $131,059 | $127,605 | 2.7% | | Adjusted Free Cash Flow | $133,547 | $129,109 | 3.4% | - The adjustment for the six months ended June 30, 2025, includes $2.5 million for merger and acquisition expenses paid, net of tax benefit[198] Constant Currency Results This section explains the use of constant currency results to evaluate Latin American operations by neutralizing the impact of foreign exchange rate fluctuations - Constant currency results are used to evaluate Latin American operations by translating local currency items at prior-year exchange rates, excluding foreign currency rate fluctuations for period-over-period comparisons[199][200] | Exchange Rate (vs. U.S. dollar) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Favorable / (Unfavorable) Change (%) | | :-------------------------------- | :----------------------------- | :----------------------------- | :----------------------------------- | | Mexican peso | 20.0 | 17.1 | -17% | | Colombian peso | 4,195 | 3,921 | -7% | Item 3. Quantitative and Qualitative Disclosures About Market Risk This section confirms that the company's market risks, primarily related to interest rates, gold prices, and foreign currency exchange rates, remain consistent with those disclosed in its 2024 Annual Report on Form 10-K, with no material changes - The Company's primary market risks are from changes in interest rates, gold prices, and foreign currency exchange rates[202] - There have been no material changes to the Company's exposure to market risks since December 31, 2024[202] - The Company does not engage in speculative or leveraged transactions or hold financial instruments for trading purposes[202] Item 4. Controls and Procedures Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025, and reported no material changes in internal control over financial reporting during the quarter - The Company's disclosure controls and procedures were evaluated as effective at a reasonable assurance level as of June 30, 2025[203][204] - There have been no material changes in the Company's internal control over financial reporting during the quarter ended June 30, 2025[205] PART II. OTHER INFORMATION This section provides additional information not covered in the financial statements, including legal proceedings, risk factors, and other disclosures Item 1. Legal Proceedings This section refers to Note 9 of the consolidated financial statements for detailed information regarding the company's legal proceedings and commitments - Refer to Note 9 - Commitments and Contingencies of Notes to Consolidated Financial Statements for information on legal proceedings[206] Item 1A. Risk Factors This section states that there have been no material changes to the company's risk factors since its 2024 Annual Report on Form 10-K, with supplemental discussions provided in the Management's Discussion and Analysis and Governmental Regulation Update sections - There have been no material changes in the Company's risk factors from those described in Part I, Item 1A, 'Risk Factors' of the Company's 2024 Annual Report on Form 10-K[207] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section reports that the company did not purchase any shares of its common stock during the three months ended June 30, 2025, under its publicly announced repurchase program, which has $55.4 million remaining authorization - The Company did not purchase any shares of its common stock during the three months ended June 30, 2025[208] - As of June 30, 2025, $55.4 million remained available under the common stock repurchase program authorized in July 2023[208] Item 3. Defaults Upon Senior Securities The company reported no defaults upon senior securities during the period - The Company reported no defaults upon senior securities[209] Item 4. Mine Safety Disclosures This item is not applicable to the company's operations - This item is not applicable to the Company[210] Item 5. Other Information This section discloses that no directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025, except for the CFO adopting a plan to sell up to 44,000 shares - On June 2, 2025, R. Douglas Orr, Executive Vice President and Chief Financial Officer, adopted a Rule 10b5-1 trading plan to sell up to 44,000 shares of the Company's common stock, expiring on June 16, 2027[212] Item 6. Exhibits This section lists all exhibits filed as part of the Form 10-Q, including various agreements, certifications, and XBRL documents - The exhibits include the Ninth Amendment to Amended and Restated Credit Agreement, certifications pursuant to Exchange Act Sections 13(a)-14(a)/15d-14(a) and 18 U.S.C. Section 1350, and Inline XBRL documents[214] SIGNATURES The report is officially signed by the Chief Executive Officer and the Executive Vice President and Chief Financial Officer of FirstCash Holdings, Inc - The report is signed by Rick L. Wessel, Chief Executive Officer, and R. Douglas Orr, Executive Vice President and Chief Financial Officer[217]