Ezcorp, Inc. · NASDAQ:EZPW
Ezcorp — Q2 2022 Earnings Presentation
30 slides from Ezcorp's earnings presentation, May 2022
Slide 1: Second Quarter Fiscal 2022 Earnings
SECOND QUARTER FISCAL 2022 EARNINGS MAY 2022
Slide 2: Preliminary Statements
PRELIMINARY STATEMENTS FORWARD LOOKING STATEMENTS OTHER AVAILABLE INFORMATION COMPARISONS This presentation contains certain forward-looking This information should be read in conjunction statements. These statements are based on the with, and not in lieu of, the company’s annual, All comparisons in
Slide 3: Company Overview
COMPANY OVERVIEW Leader in Pawn and Pre-Owned and Recycled Retail 1,152 stores in 5 countries Formed in 1989, EZCORP has grown into a leading provider of pawn transactions in the United States and Latin America. We also sell pre- owned and recycled merchandise through a broad network of retail locat
Slide 4: Company Overview: People, Pawn, Passion
COMPANY OVERVIEW People, Pawn, Passion • Engaged workforce • Refined talent and performance management programs • Enhanced staffing strategies • Strengthened cultural alignment Ready to Meet Our Customers’ Needs • Cash on hand to fund pawn demand • Provider of affordable pre-owned and recycled gener
Slide 5: Our Path to Strengthen and Grow the Core
OUR PATH TO STRENGTHEN AND GROW THE CORE Q2 FY22 Progression Toward Our Strategic Goals Team Members Customer Focus The most passionate, productive and tenured team in the industry A passion for pawnbroking and solving customer needs • Committed and motivated • Continued expansion of teams points-ba
Slide 6: Q2 FY22 Key Financial Themes
Q2 FY22 KEY FINANCIAL THEMES PLO Continues to Increase, Driving Higher Revenue and Earnings EARNINGS FOCUS ON INVENTORY MANAGEMENT STRONG BALANCE SHEET • Net revenue of $129.1M up 14% • Merchandise sales gross profit up 4% • $255.0M cash balance up from driven by higher PSC and higher (same store sa
Slide 7: Cost Efficiency and Simplification
COST EFFICIENCY AND SIMPLIFICATION ($ millions) Cost Ratio Reductions • Q2 total expenses increased $3.4M Y/Y, primarily due to increase in store count, but total expenses as a 1 percent of net revenues for the last 12 months (LTM) as compared to LTM Mar FY21 decreased from 93% to 82%. • Due to a 14
Slide 8: Strengthen the Core
STRENGTHEN THE CORE Focus on People and Systems to Drive Increased Earnings People, Pawn, Passion Technology, Process Efficiency • In-store vacancy rates reduced as a result of new • Improved resiliency and quality of store infrastructure recruiting incentives and significant decrease in COVID-19 ◦
Slide 9: Innovate and Grow
INNOVATE AND GROW Broaden Customer Engagement to Serve More Customers, More Frequently EZ+ GROW CUSTOMER BASE STORE COUNT • EZ+ Rewards launched in all Guatemala • Online inventory showcase test continues, stores with 183 US stores participating and 13 stores offering a full eCommerce • Operating in
Slide 10: Q2 FY22 ESG Highlights
Q2 FY22 ESG HIGHLIGHTS Our Business is Part of the Circular Economy • Procured 1.5 million pre-owned items through pawn forfeitures and direct purchasing from customers Providing environmentally friendly retail experiences to our • Sold approximately 1.4 million pre-owned items — 0.8 million items i
Slide 11: Adoption of New Convertible Accounting Rules
Adoption of New Convertible Accounting Rules ($ millions, except per share amounts) • Adoption of new accounting standards for convertible Q2 YTD notes in ASU 2020-06 at the beginning of Q1 2022 FY22 FY21 FY22 FY21 • Under the new standard the dilutive effect of the 1 Basic earnings per common share
Slide 12: Financial Results - Consolidated
FINANCIAL RESULTS - CONSOLIDATED ($ millions) Q2 HIGHLIGHTS PAWN LOANS OUTSTANDING PAWN SERVICE CHARGES • PLO balance up 38%, up 33% on a $180 $180 $152.9 same store basis; now within 4% of $126.9 Q2 FY19 same store PLO balance $160 $120 • PSC up 21% driven by same-store $140 $172.7 $60 PLO growth a
Slide 13: Financial Results - U.S. Pawn
FINANCIAL RESULTS – U.S. PAWN ($ millions) Q2 HIGHLIGHTS PAWN LOANS OUTSTANDING PAWN SERVICE CHARGES • PLO balance up 40%. On a same $120 $115.3 $150 $99.8 store basis, PLO increased 39% $90 • PSC up 19% driven by higher $100 average PLO for the quarter $60 $133.5 • Merchandise sales up 7% and $50 $
Slide 14: Financial Results - Latin America Pawn
FINANCIAL RESULTS – LATIN AMERICA PAWN ($ millions) Q2 HIGHLIGHTS PAWN LOANS OUTSTANDING PAWN SERVICE CHARGES • PLO balance up 31%. On a same $40 $37.5 $50 store basis, PLO increased 13% $40 $30 $27.1 • PSC up 29% driven by increase in $30 store count of 26% and higher $20 average PLO for the quarte
Slide 15: Appendix
APPENDIX
Slide 16: Higher PLO & Revenue Drive Increased Earnings (GAAP)
HIGHER PLO & REVENUE DRIVE INCREASED EARNINGS ($ millions, except per share amounts) Q2 GAAP Results Q2 %△ YTD %△ Net revenue improvement primarily driven FY22 FY21 B/(W) FY22 FY21 B/(W) by higher PSC as a result of higher average PLO, and higher sales gross profit leading Pawn Loans Outstanding $ 1
Slide 17: Higher PLO & Revenue Drive Increased Earnings (Adjusted)
HIGHER PLO & REVENUE DRIVE INCREASED EARNINGS ($ millions, except per share amounts) Q2 Adjusted Results Q2 %△ YTD %△ FY22 FY21 B/(W) FY22 FY21 B/(W) Net revenue improvement primarily driven by higher PSC as a result of higher average Pawn Loans Outstanding $ 172.7 $ 125.3 38% $ 172.7 $ 125.3 38% PL
Slide 18: Environmental, Social and Governance
ENVIRONMENTAL, SOCIAL AND GOVERNANCE Our Business is Unique, Essential and Sustainable We are committed to meeting our customers’ needs in a responsible manner and contributing to a sustainable future by limiting our environmental impact, serving underserved customers and communities and maintaining
Slide 19: Definition of Terms
DEFINITION OF TERMS Cash Converters International Limited, a publicly-traded company based in CCV Australia, in which EZCORP holds a minority interest ESG Environmental, Social and Governance GM General merchandise (non-jewelry) Latin America, including Mexico, Central LatAm America and South Americ
Slide 20: 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 21: GAAP to Non-GAAP Reconciliation Q2 - Consolidated
GAAP TO NON-GAAP RECONCILIATION Q2 – CONSOLIDATED* ($ millions, except per share amounts) Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base FY22 FY22 FY22 FY22 FY22 FY21 FY21 FY21 Revenues 216.0 — 216.0 0.3 216.3 184.9 — 184.9
Slide 22: GAAP to Non-GAAP Reconciliation Q2 - U.S. Pawn
GAAP TO NON-GAAP RECONCILIATION Q2 – U.S. PAWN ($ millions) Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base FY22 FY22 FY22 FY22 FY22 FY21 FY21 FY21 Revenues 162.3 — 162.3 — 162.3 147.0 — 147.0 PSC Revenue 58.8 — 58.8 — 58.8
Slide 23: GAAP to Non-GAAP Reconciliation Q2 - Latin America Pawn
GAAP TO NON-GAAP RECONCILIATION Q2 – LATIN AMERICA PAWN* ($ millions) Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base FY22 FY22 FY22 FY22 FY22 FY21 FY21 FY21 Revenues 53.6 — 53.6 0.3 53.9 37.7 — 37.7 PSC Revenue 17.9 — 17.9
Slide 24: GAAP to Non-GAAP Reconciliation YTD - Continuing Operations
GAAP TO NON-GAAP RECONCILIATION YTD – CONTINUING OPERATIONS* Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base $ Millions FY22 FY22 FY22 FY22 FY22 FY21 FY21 FY21 Revenues 437.0 — 437.0 0.8 437.7 363.1 — 363.1 PSC Revenue 152.7
Slide 25: GAAP to Non-GAAP Reconciliation YTD - U.S. Pawn
GAAP TO NON-GAAP RECONCILIATION YTD – U.S. PAWN Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base $ Millions FY22 FY22 FY22 FY22 FY22 FY21 FY21 FY21 Revenues 326.0 — 326.0 — 326.0 283.5 — 283.5 PSC Revenue 115.3 — 115.3 — 115.
Slide 26: GAAP to Non-GAAP Reconciliation YTD - Latin America Pawn
GAAP TO NON-GAAP RECONCILIATION YTD – LATIN AMERICA PAWN* Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base $ Millions FY22 FY22 FY22 FY22 FY22 FY21 FY21 FY21 Revenues 110.9 — 110.9 0.8 111.7 79.3 — 79.3 PSC Revenue 37.4 — 37.
Slide 27: Consolidated Growth FY19-FY22 Reconciliation
CONSOLIDATED GROWTH FY19-FY22 RECONCILIATION* Consolidated Growth FY19-FY21 Reconciliation* ($ millions) FY19 FY19 FY19 FY19 FY19 FY20 FY20 FY20 FY20 FY20 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Continuing Ops PBT (4.7) 5.0 3.1 0.3 3.7 3.0 (34.2) (10.2) (28.7) (70.1) Add Back Net Interest 5.5 5.5 6.7 4.0 21.6
Slide 28: Pawn Businesses FY19-FY22 Reconciliation
PAWN BUSINESSES FY19-FY22 RECONCILIATION* Pawn Businesses FY18-FY21 Reconciliation* ($ millions) FY19 FY19 FY19 FY19 FY19 FY20 FY20 FY20 FY20 FY20 FY21 FY21 FY21 FY21 FY21 FY22 FY22 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 U.S. Pawn PBT 27.4 28.4 23.6 22.2 101.7 28.6 20.4 16.5 7.7 73.1 20.
Slide 29: Constant Currency
Constant Currency CONSTANT CURRENCY In addition to the financial information prepared in conformity with generally accepted accounting principles in the United States ("GAAP"), we provide certain other non-GAAP financial information on a constant currency basis ("constant currency"). We use constant
Slide 30: Thank You
EZCORP THANK YOU