Ezcorp, Inc. · NASDAQ:EZPW
Ezcorp — Q2 FY2020 Earnings Presentation
26 slides from Ezcorp's earnings presentation, May 12, 2020
Slide 1: Resilience Through the Crisis
Resilience Through the Crisis Second Quarter Fiscal 2020 Earnings May 12, 2020
Slide 2: Preliminary Statements
Preliminary Statements Forward Looking Statements This document contains certain forward-looking statements. These statements are based on the company’s current expectations as to the outcome and timing of future events. All statements, other than statements of historical facts, that address activit
Slide 3: Company Overview
Company Overview Formed in 1989, EZCORP has grown into a leading provider of pawn loans in the United States and Latin America. We also sell merchandise through a broad network of retail locations. We are dedicated to building shareholder value by satisfying the short-term cash needs of our customer
Slide 4: Management Actions in the Current Environment
Management Actions in the Current Environment Resilience through the crisis Team Members Customers Financial Valued and Protected Ready to Safely Serve Strength is a Differentiator • Supporting the well-being of our team • Pawn shops widely recognized as an • Strong balance sheet with $194M of membe
Slide 5: F2Q20 Highlights
F2Q20 Highlights Adjustments include $47.1M of Impairment Charges1 K E Y F I N AN C I A L T H E M E S Q U AR T E R LY H I G H L I G H T S • Adjusted EBITDA up 14% on strong revenue and ongoing expense management and control, especially through the March impact of COVID-19, Revenue Growth which resul
Slide 6: State of the Consumer
State of the Consumer Recent Trends Expected to Drive Increased Cash Needs Jobless Claims1 20,140 10,667 1,111 890 869 1,087 868 885 1,069 867 852 860 862 904 1,052 856 Consumer Confidence2 100 99.3 99.8 101.0 98.4 97.2 98.2 98.4 96.8 93.8 93.2 95.5 91.2 89.8 89.1 Retail Sales (MoM, SA)3 1.8% $33.3
Slide 7: Tactical Approach to Growth
Tactical Approach to Growth Management actions are keeping EZCORP strong • Strongly positioned balance sheet allows EZCORP to remain well-funded and well-capitalized through stress scenarios Stability and • 95% of stores remain open as of April 30 (99% in the US and Mexico) Liquidity • Recession-res
Slide 8: Customer Choice: Digitally-Enabled Innovation and Increased Options
Customer Choice Digitally-Enabled Innovation and Increased Options • Available in • Quickly • More than • Lana 357 stores, up brought to 600,000 CURBSIDE PAWN LANA SOCIAL MEDIA MULTI-CHANNEL PAYMENTS from 159 at market consumers • Curbside Pawn 3/31/20 engaged in • Longer-term four weeks • Cross-Sto
Slide 9: Long-Term EBITDA Growth/Margins
Long-Term EBITDA Growth/Margins Favorably positioned for long-term growth Long-Term Growth Consistent EBITDA Growth Market 14% CAGR (F2016-F2019) 1% CAGR (F2016-F2019) 35% CAGR (F2016-F2019) Consolidated EBITDA excludes Other International segments as well as Corporate Items. EBITDA figures adjusted
Slide 10: Financial Highlights - Consolidated
Financial Highlights - Consolidated • PLO balance of $165m down 5% Y/Y largely reflecting macro headwinds from COVID-19 • Merchandise sales grew 8% • Same store sales growth (SSSG) of 6% • Led by merchandise helpful in a shelter-at-home situation • Total inventory increase of 3% inclusive of de novo
Slide 11: Financial Highlights – US Pawn
Financial Highlights – US Pawn • Quarter-end PLO down 7% YoY reflecting COVID headwinds • PSC about flat Y/Y despite lower average PLO resulting from sustained Y/Y improvement in PLO yield • Sales grew 6% Y/Y on both a total and same store basis • Annualized inventory turns grew 4% Y/Y to 2.0x • Mer
Slide 12: Financial Highlights – Latin America Pawn
Financial Highlights – Latin America Pawn • Latin America pawn performance was negatively impacted by store closures at GPMX, with large portions of Guatemala and Honduras closed, and our stores in El Salvador and Peru closed since March • PLO grew 1% to $43.2m • Same Store PLO down 0.5% largely ref
Slide 13: Appendix
Appendix EZCORP
Slide 14: Strong Revenue Growth (GAAP Results)
Strong Revenue Growth EZCORP GAAP Results Q2 %∆ YTD %∆ $ Millions FY20 FY19 B/(W) FY20 FY19 B/(W) Pawn Loans Outstanding $160.1 $173.1 -8% Total revenue growth driven by a 7% increase in merchandise sales partially offset by a 2% Total Revenue $223.3 $214.7 4% $445.7 $430.4 4% reduction in PSC. The
Slide 15: Strong Revenue Growth and Ongoing Expense Management
Strong Revenue Growth and Ongoing Expense Management EZCORP Continuing Operations Adjusted Results Q2 %∆ YTD %∆ $ Millions FY20 FY19 B/(W) FY20 FY19 B/(W) Q2 PSC flat in spite of a lower average PLO Pawn Loans Outstanding $165.2 $173.1 -5% balance for the quarter due to a reduction in new loans made
Slide 16: Definition of Terms
Definition of Terms PLO Pawn loan outstanding PSC Pawn service charges Latin America, including Mexico, Central America and South LatAm America POS2 Second generation point-of-sale system Same store loan growth (stores open the entirety of SSLG comparable periods) Same store sales growth (stores ope
Slide 17: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation In addition to the financial information prepared in conformity with generally accepted accounting principles in the United States of America ("GAAP"), we provide certain other financial information that is adjusted to exclude the impact of restructuring and restateme
Slide 18: GAAP to Non-GAAP Reconciliation Q2 – Continuing Operations
GAAP to Non-GAAP Reconciliation Q2 – Continuing Operations* (F) (A) (G) (B) (H) (I) (C) (J) (D) (E) (K) Footnote * - Includes immaterial presentation reclassifications and rounding Footnote (A) Amounts include $41.3 million goodwill impairment of our US and GPMX reporting unit, a $5.6 million intang
Slide 19: GAAP to Non-GAAP Reconciliation Q2 – U.S. Pawn
GAAP to Non-GAAP Reconciliation Q2 – U.S. Pawn* (A) Footnote * - Includes immaterial presentation reclassifications and rounding 19 Footnote (A) Amounts include $10.0 million goodwill impairment of our US reporting unit
Slide 20: GAAP to Non-GAAP Reconciliation Q2 – Latin America Pawn
GAAP to Non-GAAP Reconciliation Q2 – Latin America Pawn* (D) (A) (B) (E) (F) (C) Footnote * - Includes immaterial presentation reclassifications and rounding Footnote (A) Amounts include $31.3 million goodwill impairment of our GPMX reporting unit and $4.6 million intangible impairment Footnote (B)
Slide 21: GAAP to Non-GAAP Reconciliation YTD – Continuing Operations
GAAP to Non-GAAP Reconciliation YTD – Continuing Operations* (F) (A) (G) (H) (B) (C) (I) (D) (J) (E) (K) Footnote * - Includes immaterial presentation reclassifications and rounding Footnote [A] Amounts include $41.3 million goodwill impairment of our US and GPMX reporting unit, a $5.6 million intan
Slide 22: GAAP to Non-GAAP Reconciliation YTD – U.S. Pawn
GAAP to Non-GAAP Reconciliation YTD – U.S. Pawn* (A) (B) Footnote * - Includes immaterial presentation reclassifications and rounding 22 Footnote (A) Amounts include $10.0 million goodwill impairment of our US reporting unit Footnote (B) Amount includes $2.9m reserve on exposure to Republic Metals C
Slide 23: GAAP to Non-GAAP Reconciliation YTD – Latin America Pawn
GAAP to Non-GAAP Reconciliation YTD – Latin America Pawn* (D) (A) (E) (B) (F) (C) (G) Footnote * - Includes immaterial presentation reclassifications and rounding Footnote [A] Amounts include $31.3 million goodwill impairment of our GPMX reporting unit and $4.6 million intangible impairment Footnote
Slide 24: Consolidated Growth FY17-FY19 Reconciliation
Consolidated Growth FY17-FY19 Reconciliation* FY17 FY17 FY17 FY17 FY17 FY18 FY18 FY18 FY18 FY18 Q1 Q2 Q3 Q4 Full Year Q1 Q2 Q3 Q4 Full Year Continuing Ops PBT 13.0 13.7 8.8 7.2 42.7 19.7 17.5 15.5 2.9 55.5 Add Back Net Interest 2.9 3.4 3.6 5.8 15.7 1.6 1.6 3.0 4.6 10.8 Add Back Deprciation and Amort
Slide 25: Pawn Businesses FY17-FY19 Reconciliation
Pawn Businesses FY17-FY19 Reconciliation* FY17 FY17 FY17 FY17 FY17 FY18 FY18 FY18 FY18 FY18 FY19 FY19 FY19 FY19 FY19 FY20 FY20 Q1 Q2 Q3 Q4 Full Year Q1 Q2 Q3 Q4 Full Year Q1 Q2 Q3 Q4 Full Year Q1 Q2 U.S. Pawn PBT 27.2 29.8 23.9 22.8 103.6 27.8 28.2 21.3 25.5 102.7 27.4 28.4 23.6 22.2 101.7 28.6 20.4
Slide 26: Constant Currency
Constant Currency In addition to the financial information prepared in conformity with accounting principles generally accepted in the United States ("GAAP"), we provide certain other non-GAAP financial information on a constant currency basis ("constant currency"). We use constant currency results