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Ezcorp Inc (EZPW) SEC Filing 10-K Annual report for the fiscal year ending Wednesday, September 30, 2020

Ezcorp Inc

CIK: 876523 Ticker: EZPW


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EZCORP Reports Third Quarter Fiscal Year 2020 Results
Austin, Texas (August 4, 2020) —
EZCORP, Inc. (NASDAQ: EZPW) today announced results for its fiscal third quarter ended June 30, 2020.

All amounts in this release are from EZCORP continuing operations and in conformity with U.S. generally accepted accounting principles ("GAAP") unless otherwise noted. Comparisons shown in this release are to the same period in the prior year unless otherwise noted. 
HIGHLIGHTS FOR THIRD QUARTER OF FISCAL 2020    
Total revenues grew 4% in the quarter to $210.2 million. Retail sales grew 31% to $136.5 million, driven primarily by strong demand for merchandise for working and schooling from home. Net revenues declined 12% driven by a 34% reduction in pawn service (PSC) revenue, partially offset by a 33% increase in merchandise sales gross profit.
Operations expenses declined by 3% to $83.8 million while total store count grew by 2%.
Loss before taxes was $10.2 million, compared to profit before taxes of $3.5 million in the prior-year quarter. On an adjusted basis1, loss before taxes was $3.5 million, compared to profit before taxes of $13.6 million in the prior-year quarter. Diluted loss per share was $0.10, compared to diluted earnings per share of $0.06 in the prior-year quarter. On an adjusted basis, diluted loss per share was $0.01, compared to diluted earnings per share of $0.16. 
Pawn loan volume was reduced during the quarter by emergency stimulus payment actions in the U.S. and restrictions on customer movements and localized store closure orders in Latin America. Pawn loans outstanding (PLO) decreased 40% to $113.3 million (down 39% to $116.8 million on a constant currency basis), which led to a 34% reduction in PSC revenue to $52.5 million (down 31% to $54.4 million on a constant currency basis). 
Net inventory of $123.1 million ($127.1 million on a constant currency basis) decreased 30%, reflecting annualized inventory turnover of 2.9x. Sales margin of 33% increased 40bps despite a $2.2 million adjustment to merchandise cost of goods sold due to looting at 30 stores during riots in the U.S.  
Cash and cash equivalents increased to $311 million as of June 30, 2020, an increase of over $100 million compared to the prior quarter. The decline in new pawn loan originations and increased merchandise and scrap sales all benefited the cash position. 
Following a review of strategic alternatives for the non-core CashMax business in Canada, the Company has decided to close the remaining 22 stores. The shutdown of the business and related operations will be substantially completed during the fourth quarter of fiscal 2020 and will result in charges of approximately $8.0 - $10.0 million. 
CEO COMMENTARY AND OUTLOOK 
Chief Executive Officer Jason Kulas stated: “Our results for the fiscal third quarter were highlighted by ongoing revenue growth driven by strong retail sales. As a result of stimulus payments and extended unemployment and forbearance benefits, our customers’ needs for cash were lower in the quarter, driving declines in PLO and PSC.  While sales gross profit margins were strong, the tradeoff in higher-margin pawn service charges for lower-margin merchandise sales negatively impacted EBITDA and EPS in the quarter. 
“In these uncertain times, we are focused on the safety of our team members and customers and on our continued financial strength. Our cash balance grew by over $100 million to $311 million from the second quarter, positioning us to meet our customers’ short-term needs for cash as loan demand rebounds.  In addition, our team is focused on increasing the efficiency of our operations, with significant expense reductions planned for fiscal year 2021. These efforts are expected to add an even greater level of resiliency to our business through the current environment and future economic cycles. 
“In addition to optimizing our cost structure to maximize profitability and better align with near-term PLO trends, we are focused on creating long-term shareholder value by strengthening our core business operations and continuing to innovate and grow.  Our optimization of pricing, lending and transactional efficiencies, and the modernization of our IT and data assets, will



The following information was filed by Ezcorp Inc (EZPW) on Tuesday, August 4, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside this 10-K Annual Report

Cover Page
Consolidated Balance Sheets
Consolidated Balance Sheets (Parenthetical)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Comprehensive (Loss) Income
Consolidated Statements Of Comprehensive (Loss) Income (Parentheticals)
Consolidated Statements Of Operations
Consolidated Statements Of Stockholders' Equity
(Loss) Earnings Per Share
(Loss) Earnings Per Share (Details)
(Loss) Earnings Per Share (Tables)
Acquisitions
Acquisitions (Tables)
Acquisitions - Additional Information Regarding Recent Acquisitions (Details)
Acquisitions - Other Information For Fiscal 2018 Acquisitions (Details)
Acquisitions - Proforma Information (Details)
Common Stock And Stock Compensation
Common Stock And Stock Compensation (Tables)
Common Stock And Stock Compensation - Additional Disclosures (Details)
Common Stock And Stock Compensation - Compensation Costs (Details)
Common Stock And Stock Compensation - Restricted Stock Award Activity (Details)
Contingencies
Debt
Debt (Tables)
Debt - 2019 Convertible Notes Hedges And Warrants (Details)
Debt - Cash Convertible Senior Notes Due 2019 (Details)
Debt - Cashmax Secured Borrowing Facility (Details)
Debt - Convertible Senior Notes Due 2024 (Details)
Debt - Convertible Senior Notes Due 2025 (Details)
Debt - Interest Expense (Details)
Debt - Principal Payment Schedule (Details)
Debt - Schedule Of Debt Instruments (Details)
Fair Value Measurements
Fair Value Measurements (Tables)
Fair Value Measurements - Additional Disclosures (Details)
Fair Value Measurements - Financial Assets, Temporary Equity And Liabilities Not Measured At Fair Value (Details)
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables)
Goodwill And Intangible Assets - Additional Information (Details)
Goodwill And Intangible Assets - Future Amortization Expense (Details)
Goodwill And Intangible Assets - Goodwill (Details)
Goodwill And Intangible Assets - Intangible Assets By Major Class (Details)
Income Taxes
Income Taxes (Tables)
Income Taxes - Additional Disclosures (Details)
Income Taxes - Components Of Income Tax Provision (Details)
Income Taxes - Deferred Tax Assets And Liabilities (Details)
Income Taxes - Foreign And Domestic Income Components (Details)
Income Taxes - Reconciliation Of Income Taxes (Details)
Income Taxes - Unrecognized Tax Benefits (Details)
Leases
Leases (Tables)
Leases - Additional Information (Details)
Leases - Assets And Liabilities Recognized Upon Adoption (Details)
Leases - Lease Cost (Details)
Leases - Operating Lease Maturity (Details)
Leases - Rent Expense (Details)
Leases - Schedule Of Future Minimum Rental Payments (Details)
Organization And Summary Of Significant Accounting Policies
Organization And Summary Of Significant Accounting Policies (Policies)
Organization And Summary Of Significant Accounting Policies - Convertible Debt Securities (Details)
Organization And Summary Of Significant Accounting Policies - Description Of Business (Details)
Organization And Summary Of Significant Accounting Policies - Earnings Per Share And Common Stock (Details)
Organization And Summary Of Significant Accounting Policies - Equity Method Investments (Details)
Organization And Summary Of Significant Accounting Policies - Foreign Currency And Advertising (Details)
Organization And Summary Of Significant Accounting Policies - Goodwill And Other Intangible Assets (Details)
Organization And Summary Of Significant Accounting Policies - Impact Of Covid-19 (Details)
Organization And Summary Of Significant Accounting Policies - Inventory And Cash And Cash Equivalents And Cash Concentrations (Details)
Organization And Summary Of Significant Accounting Policies - Leases (Details)
Organization And Summary Of Significant Accounting Policies - Pawn And Sales Revenue Recognition (Details)
Organization And Summary Of Significant Accounting Policies - Property And Equipment (Details)
Organization And Summary Of Significant Accounting Policies - Software Development Costs (Details)
Other Charges
Other Charges (Tables)
Other Charges - Activity (Details)
Other Charges - Additional Information (Details)
Property And Equipment
Property And Equipment (Details)
Property And Equipment (Tables)
Quarterly Information (Unaudited)
Quarterly Information (Unaudited) (Tables)
Quarterly Information (Unaudited) - Schedule Of Quarterly Information (Details)
Segment Information
Segment Information (Tables)
Segment Information - Operating Segment Information (Details)
Segment Information - Reconciliation Of Segment Assets (Details)
Segment Information - Revenues And Long-Lived Assets By Geographic Information (Details)
Strategic Investments
Strategic Investments (Tables)
Strategic Investments - Additional Information (Details)
Strategic Investments - Summarized Financial Information (Details)
Supplemental Consolidated Financial Information
Supplemental Consolidated Financial Information (Tables)
Supplemental Consolidated Financial Information - Supplemental Consolidated Balance Sheet Information (Details)
Supplemental Consolidated Financial Information - Valuation And Qualifying Accounts (Details)
Ticker: EZPW
CIK: 876523
Form Type: 10-K Annual Report
Accession Number: 0000876523-20-000059
Submitted to the SEC: Mon Dec 14 2020 5:13:34 PM EST
Accepted by the SEC: Mon Dec 14 2020
Period: Wednesday, September 30, 2020
Industry: Retail Miscellaneous Retail

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