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Cash America International Inc. Reports Operating Results (10-Q)

July 27, 2012 | About:
10qk

10qk

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Cash America International Inc. (CSH) filed Quarterly Report for the period ended 2012-06-30.

Cash America International, Inc. has a market cap of $1.32 billion; its shares were traded at around $37.1 with a P/E ratio of 9.9 and P/S ratio of 0.9. The dividend yield of Cash America International, Inc. stocks is 0.3%. Cash America International, Inc. had an annual average earning growth of 23.6% over the past 10 years. GuruFocus rated Cash America International, Inc. the business predictability rank of 3.5-star.

Highlight of Business Operations:

Consolidated net revenue increased $23.8 million, or 11.3%, to $233.6 million for the current quarter from $209.8 million for the prior year quarter. Net revenue from consumer loan fees, net of consumer loan loss provision, increased 24.1%, or $21.0 million, in the current quarter compared to the prior year quarter, primarily due to higher average consumer loan balances in the e-commerce segment from growth in both domestic and foreign markets, combined with lower consumer loan loss provision expense in foreign markets. Net revenue from pawn-related activities, which is the sum of pawn loan fees and service charges and the net proceeds from the disposition of merchandise, increased 2.5%, or $3.0 million, in the current quarter compared to the prior year quarter.

For the current quarter, consolidated net revenue increased $23.8 million, or 11.3%, to $233.6 million from $209.8 million for the prior year quarter. Pawn lending activities accounted for 52.4% and 56.9% of total consolidated net revenue for the current quarter and prior year quarter, respectively. Net revenue from pawn lending activities increased $3.0 million, to $122.4 million during the current quarter, from $119.4 million in the prior year quarter, which accounted for 12.6% of the overall increase in net revenue. The increase in pawn-related contribution was primarily due to an increase in pawn loan fees and service charges that resulted from higher average pawn loan balances as a result of organic growth in domestic retail operations and the acquisition of substantially all of the assets of Pawn Partners, Inc. and related entities during the fourth quarter of 2011, which, prior to its acquisition by the Company, operated a seven-store chain of pawn lending locations in Arizona as franchised Company locations under the name SuperPawn (the Pawn Partners acquisition). The $5.6 million increase in pawn loan fees and service charges was partially offset by lower gross profit on the disposition of merchandise, which decreased by $2.6 million during the current quarter compared to the prior year quarter, primarily due to lower gross profit margins on the disposition of merchandise.

For the six-month period ended June 30, 2012 (the current six-month period), net revenue increased $64.4 million, or 15.1%, to $490.4 million from $426.0 million for the same period in 2011 (the prior year six-month period). Net revenue from pawn lending activities accounted for 54.1% and 58.1% of total net revenue for the current six-month period and the prior year six-month period, respectively. Net revenue from pawn lending activities increased $18.0 million, to $265.3 million during the current six-month period from $247.3 million in the prior year six-month period, which accounted for 27.9% of the increase in net revenue. The increase in the pawn-related contribution was primarily due to an increase in pawn loan fees and service charges that resulted from higher average pawn loan balances as a result of organic growth in domestic retail operations and the Pawn Partners acquisition.

Proceeds from commercial dispositions increased $5.3 million, or 7.8%, during the current quarter compared to the prior year quarter. Domestic operations contributed $10.5 million of the increase, primarily due to a higher average sales price per ounce of gold sold and a slight increase in the volume of gold sold during the current quarter. Proceeds from dispositions at foreign operations decreased by $5.2 million, primarily due to a lower volume of gold sold in the current quarter compared to the prior year quarter. Consolidated gross profit from commercial dispositions decreased $3.7 million, of which domestic operations contributed $2.3 million, and foreign operations contributed $1.4 million. The decrease was primarily due to a higher cost of gold sold relative to the increase in the market price per ounce of gold sold in both domestic and foreign operations. Consequently, the consolidated gross profit margin on commercial sales decreased to 25.7% in the current quarter from 33.2% in the prior year quarter.

Proceeds from commercial dispositions increased $27.1 million, or 19.2%, during the current six-month period over the prior year six-month period. Domestic operations contributed $34.1 million of the increase. Proceeds from dispositions at foreign operations decreased by $7.0 million, primarily due to a lower volume of gold sold in the current year six-month period compared to the prior year six-month period. Consolidated gross profit from commercial dispositions increased $0.5 million to $46.9 million, of which domestic operations contributed $2.7 million, offset by a decrease in gross profit at the Companys foreign operations of $2.2 million. The increase was mainly due to a higher volume of domestic commercial merchandise sales, which was offset by lower gross profit margin from higher cost of gold sold relative to the increase in the market price per ounce of gold sold in both domestic and foreign operations. The gross profit margin on commercial sales decreased to 27.8% in the current six-month period from 32.8% in the prior year six-month period, primarily due to an increase in the cost per ounce of gold sold in both domestic and foreign operations.

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