Arlington-based First Cash Financial Services earned $22.7 million, or 77 cents a share, in the year's first quarter, up 12 percent from a year earlier, on $170 million in revenue. The operator of 830 pawn shops in the U.S. and Mexico said those results included a one-time tax benefit of 12 cents a share. Wall Street analysts' consensus estimate for the quarter, which typically excludes unusual items, was 66 cents a share. First Cash's shares (ticker: FCFS) were virtually unchanged in mid-morning trading.
The company said it closed 37 of its Cash & Go locations that make short-term loans, also called payday loans, during the quarter and will continue to reduce its payday lending activity. In the first quarter payday lending accounted for 6 percent of revenue and is expected to account for less than 5 percent by year's end, said CEO Rick Wessel. The company said payday loan revenue was down 17 percent in the quarter compared to a year earlier and "represents a continuation of regulatory and competitive pressures facing store-based payday lenders, especially in Texas." Profit from the sale of scrap jewelry fell 46 percent as the price of gold fell 21 percent and First Cash' scrap jewelry volume was down 28 percent.
The number of outstanding pawn loans was up 30 percent in the U.S. and up 11 percent in Mexico. Overall, the dollar amount of outstanding pawn loans rose 12 percent, reflecting a smaller average loan value and lower loan values on jewelry-secured pawns.
-- Jim Fuquay