Ezcorp, Inc. · NASDAQ:EZPW
Ezcorp — Q2 2021 Earnings Presentation
25 slides from Ezcorp's earnings presentation, May 6, 2021
Slide 1: Second Quarter Fiscal 2021 Earnings
Second Quarter Fiscal 2021 Earnings May 6, 2021
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 pre-owned merchandise through a broad network of retail locations. We are dedicated to building shareholder value by satisfying the short-term cash needs of ou
Slide 4: Our Path To Strengthen And Grow The Core
Our Path To Strengthen And Grow The Core Continuing Progress Toward Our Strategic Goals • Store traffic • Declining attrition counters • Diversity and implemented in the Inclusion programs • New recognition U.S. allowing us to programs better understand customer behaviors • Merchandise sales • Acqui
Slide 5: 2021 Q2 Key Financial Themes
2021 Q2 Key Financial Themes Positioning EZCORP for Positive Operating Leverage as Demand for Pawn Loans Returns • Adjusted EPS of $0.17 consistent with Q2FY20, as lower net revenue was offset by reduced expenses Earnings • Net revenue down 11% Y/Y driven by lower PSC partially offset by higher merc
Slide 6: Cost Reduction and Simplification
1 Cost Reduction and Simplification Continuous Process • We continue to execute on the strategic initiatives implemented since Q4FY20 and have increased the targeted annual cost savings from $13M+ to $14M+, mostly related to G&A expenses • We continue to focus on cost reduction and improving product
Slide 7: Strengthen the Core
2 Strengthen the Core Strategic Focus on Operating Disciplines and Modernization of Critical IT Systems People, Pawn & Passion Technology, Process Efficiency • Ongoing focus on identification and development of • POS2 converted to a flexible modern microservices store Team Members through meticulous
Slide 8: Innovate and Grow
3 Innovate and Grow Broaden Customer Engagement to Service More Customers, More Frequently • Online extensions through lana.com grew more than 70% in transaction count and doubled in Lana the amount of PSC collected when compared to Q1FY21 • Layaway payments now available in all U.S. stores, with ov
Slide 9: Financial Results - Consolidated
Financial Results - Consolidated • PLO balance of $122.5M, down 24% Y/Y largely related to impact of recent stimulus payments • Merchandise sales down 11% Y/Y ◦ Same store sales down 11% ◦ Merchandise sales gross profit up 12% due to higher margins expanded to 892 bps Y/Y related to improved invento
Slide 10: Financial Results – U.S. Pawn
Financial Results – U.S. Pawn • PLO down 22% Y/Y reflecting lower demand related to stimulus payments • PSC down 20% driven by lower average PLO for the quarter partially offset by Y/Y improvement in PLO yield due to a higher redemption rate • Merchandise sales decreased 8% Y/Y for the quarter ◦ Sam
Slide 11: Financial Results – Latin America Pawn
Financial Results – Latin America Pawn • PLO down 29% Y/Y to $27.1M as a result of the impact of constrained traffic, limited operating hours and increased remittances from the U.S. • PSC down 24% Y/Y driven by lower average PLO for the quarter partially offset by Y/Y improvement in PLO yield due to
Slide 12: Appendix
Appendix EZCORP
Slide 13: Lower PLO Balance Pressures Net Revenue – EZCORP GAAP Results
Lower PLO Balance Pressures Net Revenue EZCORP GAAP Results Q2 % YTD % $ Millions FY21 FY20 B/(W) FY21 FY20 B/(W) Pawn Loans Outstanding $ 125.3 $ 160.2 (22)% $ 125.3 $ 160.2 (22)% Total Revenue $ 184.9 $ 223.3 (17)% $ 363.0 $ 445.7 (19)% FY21 YTD net revenue down, primarily driven by lower PLO/PS
Slide 14: Lower PLO Balance Weighs on EBITDA/EPS – Adjusted Results
Lower PLO Balance Weighs on EBITDA/EPS EZCORP Adjusted Results Q2 % YTD % $ Millions FY21 FY20 B/(W) FY21 FY20 B/(W) Pawn Loans Outstanding $ 122.5 $ 160.2 (24)% $ 122.5 $ 160.2 (24)% Total Revenue $ 185.5 $ 223.3 (17)% $ 365.7 $ 445.8 (18)% FY21 YTD net revenue down, primarily driven by lower PLO
Slide 15: Definition of Terms
Definition of Terms PLO Pawn loans outstanding PSC Pawn service charges Latin America, including Mexico, Central LatAm America and South America POS2 Second generation point-of-sale system Same store loan growth (stores open the SSLG entirety of comparable periods) Same store sales growth (stores op
Slide 16: 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 17: GAAP to Non-GAAP Reconciliation Q2 – Consolidated
GAAP to Non-GAAP Reconciliation Q2 – Consolidated* Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base $ Millions FY21 FY21 FY21 FY21 FY21 FY20 FY20 FY20 Revenues 184.9 — 184.9 0.6 185.5 223.3 — 223.3 PSC Revenue 63.4 — 63.4 0.2
Slide 18: GAAP to Non-GAAP Reconciliation Q2 – U.S. Pawn
GAAP to Non-GAAP Reconciliation Q2 – U.S. Pawn* Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base $ Millions FY21 FY21 FY21 FY21 FY21 FY20 FY20 FY20 Revenues 147.0 — 147.0 — 147.0 173.8 — 173.8 PSC Revenue 49.6 — 49.6 — 49.6 6
Slide 19: GAAP to Non-GAAP Reconciliation Q2 – Latin America Pawn
GAAP to Non-GAAP Reconciliation Q2 – Latin America Pawn* Constant Adjusted Item Adjusted Currency Constant Item Adjusted Base Adjustments Base Impact Currency Base Adjustments Base $ Millions FY21 FY21 FY21 FY21 FY21 FY20 FY20 FY20 Revenues 37.7 — 37.7 0.6 38.3 48.1 — 48.2 PSC Revenue 13.9 — 13.9 0.
Slide 20: 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 FY21 FY21 FY21 FY21 FY21 FY20 FY20 FY20 Revenues 363.0 — 363.0 2.7 365.7 445.7 — 445.8 PSC Revenue 126.9
Slide 21: 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 FY21 FY21 FY21 FY21 FY21 FY20 FY20 FY20 Revenues 283.5 — 283.5 — 283.5 339.4 — 339.4 PSC Revenue 99.8 — 99.8 — 99.8
Slide 22: 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 FY21 FY21 FY21 FY21 FY21 FY20 FY20 FY20 Revenues 79.3 — 79.3 2.7 81.9 103.6 — 103.6 PSC Revenue 27.1 — 27.1
Slide 23: Consolidated Growth FY19-FY21 Reconciliation
Consolidated Growth FY19-FY21 Reconciliation* FY18 FY18 FY18 FY18 FY18 FY19 FY19 FY19 FY19 FY19 $ Millions Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Continuing Ops PBT 19.7 17.5 15.5 2.9 55.5 (4.7) 5.0 3.1 0.3 3.7 Add Back Net Interest 1.6 1.6 3.0 4.6 10.8 5.5 5.5 6.7 4.0 21.6 Add Back Depreciation and Amortiza
Slide 24: Pawn Businesses FY18-FY21 Reconciliation
Pawn Businesses FY18-FY21 Reconciliation* FY18 FY18 FY18 FY18 FY18 FY19 FY19 FY19 FY19 FY19 FY20 FY20 FY20 FY20 FY20 FY21 FY21 $ Millions Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 U.S. Pawn PBT 27.8 28.2 21.3 25.5 102.7 27.4 28.4 23.6 22.2 101.7 28.6 20.4 16.5 7.7 73.1 20.7 25.7 Add Back Ne
Slide 25: 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 currency results