FirstCash(US:FCFS)2021-07-22 16:00Store Operations - As of June 30, 2021, the Company operated 2,804 store locations, including 1,071 in the U.S. and 1,733 in Latin America[88]. - The Company plans to grow revenues by opening new retail pawn locations and acquiring existing stores in strategic markets[87]. - The company intends to continue expansion through new store openings primarily in Latin America and opportunistic acquisitions in both the U.S. and Latin America[159]. Financial Performance - Total revenue for the U.S. operations segment decreased by 15% to $247.0 million from $291.0 million in the same period last year[100]. - Consolidated net income for Q2 2021 was $28.4 million, a 10% increase from $25.9 million in Q2 2020[126]. - U.S. operations segment pre-tax operating income decreased by 10% to $47.1 million in Q2 2021 compared to $52.2 million in Q2 2020[126]. - Latin America operations segment pre-tax operating income increased by 36% to $28.1 million in Q2 2021 compared to $20.6 million in Q2 2020[126]. - Total revenue for U.S. operations decreased by 13% to $522.6 million in the first half of 2021 compared to $601.6 million in the first half of 2020[131]. - U.S. retail merchandise sales decreased by 10% to $363.2 million during the first half of 2021 compared to $404.9 million in the first half of 2020[134]. - Consolidated net income increased 6% to $62.1 million for the six months ended June 30, 2021, compared to $58.8 million for the same period in 2020[151]. Loan and Revenue Trends - U.S. pawn loans increased by 29% to $203.8 million compared to $158.3 million as of June 30, 2020[96]. - Pawn loan receivables increased 29% in total and 24% on a same-store basis as of June 30, 2021, compared to June 30, 2020[105]. - Pawn loan fees in Latin America increased 43% to $43.0 million during Q2 2021 compared to $30.1 million in Q2 2020[120]. - U.S. pawn loan fees decreased 7% to $66.9 million during Q2 2021 compared to $71.9 million in Q2 2020[106]. - U.S. pawn loan fees decreased by 16% to $143.3 million during the first half of 2021 compared to $169.8 million in the first half of 2020[136]. Inventory Management - U.S. inventories rose by 20% to $144.1 million from $120.4 million as of June 30, 2020[104]. - The percentage of inventory aged greater than one year in the U.S. decreased to 1% from 3% year-over-year[104]. - Inventories in Latin America increased 22% from $59.6 million at June 30, 2020, to $72.9 million at June 30, 2021[119]. Market Conditions and Risks - The COVID-19 pandemic has had a continuing impact on the Company's operations and demand for pawn loans[92]. - The impact of COVID-19 presents material uncertainty that could adversely affect the Company's future results of operations and cash flows[167]. - Market risks primarily arise from changes in interest rates, gold prices, and foreign currency exchange rates[190]. Cash Flow and Capital Management - Net cash provided by operating activities decreased by $29.6 million, or 21%, from $143.3 million in 2020 to $113.7 million in 2021[164]. - Net cash used in investing activities increased by $238.4 million, or 183%, from net cash provided of $130.4 million in 2020 to net cash used of $107.9 million in 2021[165]. - Net cash used in financing activities decreased by $223.3 million, or 91%, from $244.8 million in 2020 to $21.5 million in 2021[166]. - Working capital increased from $325.5 million in 2020 to $401.2 million in 2021[164]. - Current ratio improved from 2.6:1 in 2020 to 2.7:1 in 2021[164]. - The company reported total debt of $663,000 thousand, with cash and cash equivalents of $(50,061) thousand, resulting in net debt of $612,939 thousand[182]. Shareholder Returns - The company declared a $0.30 per share cash dividend for the third quarter, totaling $12.2 million based on the June 30, 2021 share count[160]. - The company repurchased 536,000 shares of common stock at an aggregate cost of $38.0 million during the six months ended June 30, 2021[161]. Expense Management - U.S. store operating expenses decreased 9% to $93.6 million during Q2 2021 compared to $103.3 million in Q2 2020[108]. - Administrative expenses decreased by 3% to $27.4 million in Q2 2021 compared to $28.4 million in Q2 2020[127]. - Administrative expenses decreased 5% to $58.4 million during the six months ended June 30, 2021, compared to $61.3 million for the same period in 2020[152]. - Interest expense decreased 6% to $14.4 million during the six months ended June 30, 2021, compared to $15.4 million in 2020[153]. Adjusted Financial Metrics - Adjusted net income for the six months ended June 30, 2021 was $29.0 million, with adjusted diluted earnings per share of $0.71[176]. - The company reported an adjusted EBITDA of $57,524 thousand for June 2021, compared to $53,930 thousand in June 2020, reflecting a year-over-year increase of approximately 2.2%[182]. - Free cash flow for June 2021 was $(17,845) thousand, a significant decrease from $182,019 thousand in June 2020, indicating a decline in cash generation[186]. - Adjusted free cash flow for June 2021 was $(17,019) thousand, a decrease from $182,115 thousand in June 2020, highlighting challenges in cash flow management[186].