Bay Street News

FirstCash Reports Second Quarter Operating Results; U.S. Pawn Fees Grow 22%, Driving 25% Increase in U.S. Pawn Segment Earnings; 47 Pawn Locations Added in Second Quarter Through Acquisitions and New Store Openings; Quarterly Cash Dividend Increased to $0.38 per Share

FORT WORTH, Texas, July 25, 2024 (GLOBE NEWSWIRE) — FirstCash Holdings, Inc. (“FirstCash” or the “Company”) (Nasdaq: FCFS), the leading international operator of more than 3,000 retail pawn stores and a leading provider of retail point-of-sale (“POS”) payment solutions through American First Finance (“AFF”), today announced operating results for the three and six month periods ended June 30, 2024. The Company also announced that the Board of Directors declared a quarterly cash dividend of $0.38 per share, an increase of 9% compared to the previous quarterly dividend of $0.35 per share, to be paid in August 2024.

Mr. Rick Wessel, chief executive officer, stated, “We are pleased to report another quarter of record revenues and strong earnings growth. The U.S. pawn segment delivered outstanding results with a 25% increase in second quarter segment income, coupled with solid earnings results in both the LatAm pawn and AFF segments. FirstCash continued to invest significantly in the long-term growth of its core pawn operations during the second quarter, adding 26 U.S. pawn locations through multiple acquisitions and opening 21 new stores, mostly in Latin America.

“FirstCash’s balance sheet and cash flows remain exceptionally strong. In addition to acquisitions and new store openings, we repurchased $85 million of stock this quarter and raised the next quarterly cash dividend to further drive long-term shareholder value.”

This release contains adjusted financial measures, which exclude certain non-operating and/or non-cash income and expenses, that are non-GAAP financial measures. Please refer to the descriptions and reconciliations to GAAP of these and other non-GAAP financial measures at the end of this release.

    Three Months Ended June 30,
    As Reported (GAAP)   Adjusted (Non-GAAP)
In thousands, except per share amounts   2024   2023   2024   2023
Revenue   $ 831,012   $ 750,622   $ 831,012   $ 750,622
Net income   $ 49,073   $ 45,180   $ 61,898   $ 55,553
Diluted earnings per share   $ 1.08   $ 0.99   $ 1.37   $ 1.22
EBITDA (non-GAAP measure)   $ 117,651   $ 108,237   $ 121,882   $ 107,473
Weighted-average diluted shares     45,289     45,678     45,289     45,678
    Six Months Ended June 30,
    As Reported (GAAP)   Adjusted (Non-GAAP)
In thousands, except per share amounts   2024   2023   2024   2023
Revenue   $ 1,667,382   $ 1,513,361   $ 1,667,382   $ 1,513,361
Net income   $ 110,441   $ 92,568   $ 132,087   $ 113,253
Diluted earnings per share   $ 2.44   $ 2.01   $ 2.91   $ 2.46
EBITDA (non-GAAP measure)   $ 250,238   $ 218,941   $ 253,474   $ 217,043
Weighted-average diluted shares     45,338     45,993     45,338     45,993
 

Consolidated Operating Highlights

Store Base and Platform Growth

U.S. Pawn Segment Operating Results

Latin America Pawn Segment Operating Results

Note: Certain growth rates below are calculated on a constant currency basis, a non-GAAP financial measure defined at the end of this release. The average Mexican peso to U.S. dollar exchange rate for the second quarter of 2024 was 17.2 pesos / dollar, a favorable change of 3% versus the comparable prior-year period, and for the six month period ended June 30, 2024 was 17.1 pesos / dollar, a favorable change of 6% versus the prior-year period.

American First Finance (AFF) – Retail POS Payment Solutions Segment Operating Results

Cash Flow and Liquidity

Shareholder Returns

2024 Outlook

The Company’s outlook for 2024 continues to be highly positive, with expected year-over-year growth in consolidated revenue and earnings driven by the continued growth in earning asset balances coupled with recent store additions. Anticipated conditions and trends for the remainder of 2024 include the following:

Pawn Operations:

U.S. Pawn

Latin America Pawn

Retail POS Payment Solutions (AFF) Operations:

Interest Expense, Tax Rates and Currency:

Additional Commentary and Analysis

Mr. Wessel provided additional insights on the Company’s second quarter results and outlook for the remainder of 2024, “Our second quarter and year-to-date operating results were outstanding and the outlook for the remainder of 2024 is highly positive. In addition, we continue to utilize our balance sheet and strong cash flows to further invest in the long-term growth of our core pawn operations and provide shareholder returns through the increased dividend and stock repurchases.

“Pawn demand continues to be extremely strong as evidenced by outstanding second quarter results in our U.S. pawn segment. This represents the fourth consecutive quarter of double-digit growth in same-store pawn receivables and pawn fees. Pawn retail metrics in the U.S. were also impressive, with a 7% increase in same-store merchandise sales and sequential gross margin improvement. Store growth in the U.S. also remains robust as we completed three separate acquisitions which added 26 domestic locations during the quarter and have acquired a total of 114 locations over the past 12 months. Given the store growth coupled with the strong same-store increases, our total U.S. pawn receivables are up 22% over last year as we begin the second half of 2024.

“In Latin America, we continued to see improving pawn demand in the second quarter combined with strong retail sales and margins. Additionally we have opened an impressive 39 locations in just the first six months of this year and continue to evaluate acquisition opportunities and look to further expand our market leading position in Latin America. With the current momentum, we believe that we are well positioned for segment revenue and earnings growth in the second half as well.

“We also remain positive on the long-term growth prospects for the retail POS payment solutions segment. AFF has developed a diversified merchant base representing almost 30 different retail and services verticals, with no single relationship accounting for more than approximately 15% of total merchant contribution. AFF continues to grow relationships and portfolios within each of the verticals served, providing additional stability and diversification. Based on the most recent trends in June and July, we expect growth in total originations in the second half driven by increased door counts and an influx of higher quality applicants resulting from a noticeable pullback in approvals from certain upstream lenders.

“The Company’s cash flows and balance sheet remain extremely strong. In addition to the investments in acquisitions, new locations and real estate, we repurchased $85 million of Company stock during the quarter. Furthermore, we again increased our quarterly cash dividend to an annualized payout of $1.52 per share in order to further bolster shareholder returns,” concluded Mr. Wessel.

About FirstCash

FirstCash is the leading international operator of pawn stores and a leading provider of technology-driven point-of-sale payment solutions, both focused on serving cash and credit-constrained consumers. FirstCash’s more than 3,000 pawn stores in the U.S. and Latin America buy and sell a wide variety of jewelry, electronics, tools, appliances, sporting goods, musical instruments and other merchandise, and make small non-recourse pawn loans secured by pledged personal property. FirstCash, through its wholly owned subsidiary, AFF, also provides lease-to-own and retail finance payment solutions for consumer goods and services through a nationwide network of approximately 12,800 active retail merchant partner locations. As one of the largest omni-channel providers of “no credit required” payment options, AFF’s technology provides its merchant partners with seamless leasing and financing experiences in-store, online, in-cart and on mobile devices.

FirstCash is a component company in both the Standard & Poor’s MidCap 400 Index® and the Russell 2000 Index®. FirstCash’s common stock (ticker symbol “FCFS”) is traded on the Nasdaq, the creator of the world’s first electronic stock market. For additional information regarding FirstCash and the services it provides, visit FirstCash’s websites located at http://www.firstcash.com and http://www.americanfirstfinance.com.

Forward-Looking Information

This release contains forward-looking statements about the business, financial condition, outlook and prospects of FirstCash Holdings, Inc. and its wholly owned subsidiaries (together, the “Company”), including the Company’s outlook for 2024. Forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, can be identified by the use of forward-looking terminology such as “outlook,” “believes,” “projects,” “expects,” “may,” “estimates,” “should,” “plans,” “targets,” “intends,” “could,” “would,” “anticipates,” “potential,” “confident,” “optimistic,” or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy, objectives, estimates, guidance, expectations, outlook and future plans. Forward-looking statements can also be identified by the fact that these statements do not relate strictly to historical or current matters. Rather, forward-looking statements relate to anticipated or expected events, activities, trends or results. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties.

While the Company believes the expectations reflected in forward-looking statements are reasonable, there can be no assurances such expectations will prove to be accurate. Security holders are cautioned that such forward-looking statements involve risks and uncertainties. Certain factors may cause results to differ materially from those anticipated by the forward-looking statements made in this release. Such factors and risks may include, without limitation, risks related to the extensive regulatory environment in which the Company operates; risks associated with the legal and regulatory proceedings that the Company is a party to or may become a party to in the future, including the Consumer Financial Protection Bureau (the “CFPB”) lawsuit filed against the Company; risks related to the Company’s acquisitions, including the failure of the Company’s acquisitions to deliver the estimated value and benefits expected by the Company and the ability of the Company to continue to identify and consummate acquisitions on favorable terms, if at all; potential changes in consumer behavior and shopping patterns which could impact demand for the Company’s pawn loan, retail, lease-to-own (“LTO”) and retail finance products; labor shortages and increased labor costs; a deterioration in the economic conditions in the United States and Latin America, including as a result of inflation, elevated interest rates and higher gas prices, which potentially could have an impact on discretionary consumer spending and demand for the Company’s products; currency fluctuations, primarily involving the Mexican peso; competition the Company faces from other retailers and providers of retail payment solutions; the ability of the Company to successfully execute on its business strategies; contraction in sales activity at AFF’s merchant partners; and other risks discussed and described in the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”), including the risks described in Part 1, Item 1A, “Risk Factors” thereof, and other reports filed with the SEC. Many of these risks and uncertainties are beyond the ability of the Company to control, nor can the Company predict, in many cases, all of the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements. The forward-looking statements contained in this release speak only as of the date of this release, and the Company expressly disclaims any obligation or undertaking to report any updates or revisions to any such statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

 
FIRSTCASH HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands)
 
  Three Months Ended   Six Months Ended
  June 30,   June 30,
    2024       2023       2024       2023  
Revenue:              
Retail merchandise sales $ 363,463     $ 320,864     $ 730,284     $ 648,779  
Pawn loan fees   181,046       154,178       360,581       305,738  
Leased merchandise income   194,570       189,805       400,241       373,243  
Interest and fees on finance receivables   56,799       58,192       114,186       112,834  
Wholesale scrap jewelry sales   35,134       27,583       62,090       72,767  
Total revenue   831,012       750,622       1,667,382       1,513,361  
               
Cost of revenue:              
Cost of retail merchandise sold   218,147       192,271       441,676       391,272  
Depreciation of leased merchandise   110,157       102,521       230,441       204,126  
Provision for lease losses   47,653       52,873       90,663       101,938  
Provision for loan losses   31,116       28,190       61,534       57,475  
Cost of wholesale scrap jewelry sold   28,542       21,880       51,831       57,607  
Total cost of revenue   435,615       397,735       876,145       812,418  
               
Net revenue   395,397       352,887       791,237       700,943  
               
Expenses and other income:              
Operating expenses   228,369       204,781       449,505       403,842  
Administrative expenses   45,576       40,355       88,633       79,372  
Depreciation and amortization   26,547       27,050       52,574       54,161  
Interest expense   25,187       21,071       50,605       41,968  
Interest income   (261 )     (408 )     (1,004 )     (925 )
Loss (gain) on foreign exchange   1,437       (817 )     1,251       (1,619 )
Merger and acquisition expenses   1,364       252       1,961       283  
Other expenses (income), net   1,000       79       (351 )     124  
Total expenses and other income   329,219       292,363       643,174       577,206  
               
Income before income taxes   66,178       60,524       148,063       123,737  
               
Provision for income taxes   17,105       15,344       37,622       31,169  
               
Net income $ 49,073     $ 45,180     $ 110,441     $ 92,568  
 
FIRSTCASH HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
 
  June 30,   December 31,
    2024       2023       2023  
ASSETS          
Cash and cash equivalents $ 113,693     $ 104,598     $ 127,018  
Accounts receivable, net   72,158       63,337       71,922  
Pawn loans   491,731       426,165       471,846  
Finance receivables, net   105,401       110,555       113,901  
Inventories   315,424       267,142       312,089  
Leased merchandise, net   142,935       143,145       171,191  
Prepaid expenses and other current assets   31,923       30,102       38,634  
Total current assets   1,273,265       1,145,044       1,306,601  
           
Property and equipment, net   661,005       587,934       632,724  
Operating lease right of use asset   324,651       305,513       328,458  
Goodwill   1,794,957       1,600,068       1,727,652  
Intangible assets, net   253,910       303,642       277,724  
Other assets   9,606       9,586       10,242  
Deferred tax assets, net   5,014       7,770       6,514  
Total assets $ 4,322,408     $ 3,959,557     $ 4,289,915  
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Accounts payable and accrued liabilities $ 141,314     $ 146,163     $ 163,050  
Customer deposits and prepayments   76,452       70,056       70,580  
Lease liability, current   97,809       96,215       101,962  
Total current liabilities   315,575       312,434       335,592  
           
Revolving unsecured credit facilities   150,000       376,000       568,000  
Senior unsecured notes   1,529,870       1,036,660       1,037,647  
Deferred tax liabilities, net   129,060       140,609       136,773  
Lease liability, non-current   219,454       197,135       215,485  
Total liabilities   2,343,959       2,062,838       2,293,497  
           
Stockholders’ equity:          
Common stock   575       573       573  
Additional paid-in capital   1,760,986       1,734,122       1,741,046  
Retained earnings   1,296,721       1,122,579       1,218,029  
Accumulated other comprehensive loss   (84,366 )     (49,258 )     (43,037 )
Common stock held in treasury, at cost   (995,467 )     (911,297 )     (920,193 )
Total stockholders’ equity   1,978,449       1,896,719       1,996,418  
Total liabilities and stockholders’ equity $ 4,322,408     $ 3,959,557     $ 4,289,915  
 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION
(UNAUDITED)

The Company’s reportable segments are as follows:

The Company provides revenues, cost of revenues, operating expenses, pre-tax operating income and earning assets by segment. Operating expenses include salary and benefit expenses of pawn store-level employees, occupancy costs, bank charges, security, insurance, utilities, supplies and other costs incurred by the pawn stores. Additionally, costs incurred in operating AFF have been classified as operating expenses, which include salary and benefit expenses of certain operations-focused departments, merchant partner incentives, bank and other payment processing charges, credit reporting costs, information technology costs, advertising costs and other operational costs incurred by AFF. Administrative expenses and amortization expense of intangible assets related to the purchase of AFF are not included in the segment pre-tax operating income.

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)

U.S. Pawn Segment Results

U.S. Pawn Operating Results and Margins (dollars in thousands)

  Three Months Ended        
  June 30,    
  2024
  2023   Increase
Revenue:                  
Retail merchandise sales (1) $ 230,093     $ 196,043       17 %  
Pawn loan fees   120,332       98,973       22 %  
Wholesale scrap jewelry sales   26,311       17,652       49 %  
Total revenue   376,736       312,668       20 %  
                   
Cost of revenue:                  
Cost of retail merchandise sold (2)   132,449       111,539       19 %  
Cost of wholesale scrap jewelry sold   21,269       14,225       50 %  
Total cost of revenue   153,718       125,764       22 %  
                   
Net revenue   223,018       186,904       19 %  
                   
Segment expenses:                  
Operating expenses   125,192       108,159       16 %  
Depreciation and amortization   7,231       6,330       14 %  
Total segment expenses   132,423       114,489       16 %  
                   
Segment pre-tax operating income $ 90,595     $ 72,415       25 %  
                   
Operating metrics:                  
Retail merchandise sales margin 42 %   43 %        
Net revenue margin 59 %   60 %        
Segment pre-tax operating margin 24 %   23 %        
 

(1) Includes $1.1 million and $1.8 million of retail merchandise sales from intersegment transactions for the three months ended June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment sales, consolidated U.S. retail merchandise sales for the three months ended June 30, 2024 and 2023 totaled $229.0 million and $194.3 million, respectively.

(2) Includes $0.6 million and $0.9 million of cost of retail merchandise sold from intersegment transactions for the three months ended June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment sales, consolidated U.S. cost of retail merchandise sold for the three months ended June 30, 2024 and 2023 totaled $131.9 million and $110.6 million, respectively.

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
  Six Months Ended        
  June 30,    
  2024
  2023   Increase
Revenue:                  
Retail merchandise sales (1) $ 467,083     $ 406,724       15 %  
Pawn loan fees   243,306       201,657       21 %  
Wholesale scrap jewelry sales   44,037       43,968       %  
Total revenue   754,426       652,349       16 %  
                   
Cost of revenue:                  
Cost of retail merchandise sold (2)   272,363       233,468       17 %  
Cost of wholesale scrap jewelry sold   36,535       35,307       3 %  
Total cost of revenue   308,898       268,775       15 %  
                   
Net revenue   445,528       383,574       16 %  
                   
Segment expenses:                  
Operating expenses   244,087       217,940       12 %  
Depreciation and amortization   14,244       12,200       17 %  
Total segment expenses   258,331       230,140       12 %  
                   
Segment pre-tax operating income $ 187,197     $ 153,434       22 %  
                   
Operating metrics:                  
Retail merchandise sales margin 42 %   43 %        
Net revenue margin 59 %   59 %        
Segment pre-tax operating margin 25 %   24 %        
 

(1) Includes $2.1 million and $3.5 million of retail merchandise sales from intersegment transactions for the six months ended June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment sales, consolidated U.S. retail merchandise sales for the six months ended June 30, 2024 and 2023 totaled $465.0 million and $403.3 million, respectively.

(2) Includes $1.1 million and $1.8 million of cost of retail merchandise sold from intersegment transactions for the six months ended June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment sales, consolidated U.S. cost of retail merchandise sold for the six months ended June 30, 2024 and 2023 totaled $271.2 million and $231.6 million, respectively.

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
U.S. Pawn Earning Assets and Portfolio Metrics (dollars in thousands, except as otherwise noted)
 
  As of June 30,    
  2024   2023   Increase
Earning assets:                  
Pawn loans $ 356,342     $ 291,447       22 %  
Inventories   223,428       180,410       24 %  
  $ 579,770     $ 471,857       23 %  
                   
Average outstanding pawn loan amount (in ones) $ 260     $ 241       8 %  
                   
Composition of pawn collateral:                  
General merchandise 30 %   31 %        
Jewelry 70 %   69 %        
  100 %   100 %        
                   
Composition of inventories:                  
General merchandise 43 %   44 %        
Jewelry 57 %   56 %        
  100 %   100 %        
                   
Percentage of inventory aged greater than one year 1 %   2 %        
                   
Inventory turns (trailing twelve months cost of merchandise sales divided by average inventories) 2.8 times   2.8 times        
 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)

Latin America Pawn Segment Results

Constant currency results are non-GAAP financial measures, which exclude the effects of foreign currency translation and are calculated by translating current-year results at prior-year average exchange rates. See the “Constant Currency Results” section below for additional discussion of constant currency operating results.

Latin America Pawn Operating Results and Margins (dollars in thousands)

                      Constant Currency Basis
                      Three Months        
                Ended        
    Three Months Ended           June 30,   Increase /
    June 30,   Increase /     2024     (Decrease)
      2024         2023     (Decrease)   (Non-GAAP)   (Non-GAAP)
Revenue:                              
Retail merchandise sales   $ 134,445       $ 126,581       6 %     $ 130,688       3 %  
Pawn loan fees     60,714         55,205       10 %       59,013       7 %  
Wholesale scrap jewelry sales     8,823         9,931       (11 )%       8,823       (11 )%  
Total revenue     203,982         191,717       6 %       198,524       4 %  
                               
Cost of revenue:                              
Cost of retail merchandise sold     86,276         81,660       6 %       83,871       3 %  
Cost of wholesale scrap jewelry sold     7,273         7,655       (5 )%       7,070       (8 )%  
Total cost of revenue     93,549         89,315       5 %       90,941       2 %  
                               
Net revenue     110,433         102,402       8 %       107,583       5 %  
                               
Segment expenses:                              
Operating expenses     67,902         59,507       14 %       66,044       11 %  
Depreciation and amortization     5,418         5,203       4 %       5,265       1 %  
Total segment expenses     73,320         64,710       13 %       71,309       10 %  
                               
Segment pre-tax operating income   $ 37,113       $ 37,692       (2 )%     $ 36,274       (4 )%  
                               
Operating metrics:                              
Retail merchandise sales margin 36  %   35 %         36  %        
Net revenue margin 54  %   53 %         54  %        
Segment pre-tax operating margin 18  %   20 %         18  %        
 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
                      Constant Currency Basis
                      Six Months        
                Ended        
    Six Months Ended           June 30,   Increase /
    June 30,   Increase /     2024     (Decrease)
      2024         2023     (Decrease)   (Non-GAAP)   (Non-GAAP)
Revenue:                              
Retail merchandise sales   $ 265,294       $ 245,518       8 %     $ 249,860       2 %  
Pawn loan fees     117,275         104,081       13 %       110,427       6 %  
Wholesale scrap jewelry sales     18,053         28,799       (37 )%       18,053       (37 )%  
Total revenue     400,622         378,398       6 %       378,340       %  
                               
Cost of revenue:                              
Cost of retail merchandise sold     170,459         159,623       7 %       160,578       1 %  
Cost of wholesale scrap jewelry sold     15,296         22,300       (31 )%       14,395       (35 )%  
Total cost of revenue     185,755         181,923       2 %       174,973       (4 )%  
                               
Net revenue     214,867         196,475       9 %       203,367       4 %  
                               
Segment expenses:                              
Operating expenses     135,327         115,263       17 %       127,643       11 %  
Depreciation and amortization     10,523         10,648       (1 )%       9,919       (7 )%  
Total segment expenses     145,850         125,911       16 %       137,562       9 %  
                               
Segment pre-tax operating income   $ 69,017       $ 70,564       (2 )%     $ 65,805       (7 )%  
                               
Operating metrics:                              
Retail merchandise sales margin 36  %   35 %         36  %        
Net revenue margin 54  %   52 %         54  %        
Segment pre-tax operating margin 17  %   19 %         17  %        
 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
Latin America Pawn Earning Assets and Portfolio Metrics (dollars in thousands, except as otherwise noted)
 
                      Constant Currency Basis
                      As of        
                      June 30,    
  As of June 30,   Increase /   2024   Increase
  2024   2023   (Decrease)   (Non-GAAP)   (Non-GAAP)
Earning assets:                              
Pawn loans $ 135,389     $ 134,718       %     $ 145,045     8 %  
Inventories   91,996       86,732       6 %       98,498     14 %  
  $ 227,385     $ 221,450       3 %     $ 243,543     10 %  
                               
Average outstanding pawn loan amount (in ones) $ 89     $ 91       (2 )%     $ 95     4 %  
                               
Composition of pawn collateral:                              
General merchandise 63 %   66 %                    
Jewelry 37 %   34 %                    
  100 %   100 %                    
                               
Composition of inventories:                              
General merchandise 69 %   69 %                    
Jewelry 31 %   31 %                    
  100 %   100 %                    
                               
Percentage of inventory aged greater than one year 1 %   1 %                    
                               
Inventory turns (trailing twelve months cost of merchandise sales divided by average inventories) 4.3 times   4.3 times                    
 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 

Retail POS Payment Solutions Segment Results

Retail POS Payment Solutions Operating Results (dollars in thousands)

  Three Months Ended        
  June 30,   Increase /
  2024   2023   (Decrease)
Revenue:              
Leased merchandise income $ 194,570   $ 189,805     3 %  
Interest and fees on finance receivables   56,799     58,192     (2 )%  
Total revenue   251,369     247,997     1 %  
               
Cost of revenue:              
Depreciation of leased merchandise (1)   110,567     103,062     7 %  
Provision for lease losses (2)   47,824     53,048     (10 )%  
Provision for loan losses   31,116     28,190     10 %  
Total cost of revenue   189,507     184,300     3 %  
               
Net revenue   61,862     63,697     (3 )%  
               
Segment expenses:              
Operating expenses   35,275     37,115     (5 )%  
Depreciation and amortization   678     751     (10 )%  
Total segment expenses   35,953     37,866     (5 )%  
               
Segment pre-tax operating income $ 25,909   $ 25,831     %  
 

(1) Includes $0.4 million and $0.5 million of depreciation of leased merchandise from intersegment transactions for the three months ended June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated depreciation of leased merchandise for the three months ended June 30, 2024 and 2023 totaled $110.2 million and $102.5 million, respectively.

(2) Includes $0.2 million of provision for lease losses from intersegment transactions for both the three months ended June 30, 2024 and 2023 related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated provision for lease losses for the three months ended June 30, 2024 and 2023 totaled $47.7 million and $52.9 million, respectively.

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
  Six Months Ended        
  June 30,   Increase /
  2024   2023   (Decrease)
Revenue:              
Leased merchandise income $ 400,241   $ 373,243     7 %  
Interest and fees on finance receivables   114,186     112,834     1 %  
Total revenue   514,427     486,077     6 %  
               
Cost of revenue:              
Depreciation of leased merchandise (1)   231,341     205,234     13 %  
Provision for lease losses (2)   91,004     102,214     (11 )%  
Provision for loan losses   61,534     57,475     7 %  
Total cost of revenue   383,879     364,923     5 %  
               
Net revenue   130,548     121,154     8 %  
               
Segment expenses:              
Operating expenses   70,091     70,639     (1 )%  
Depreciation and amortization   1,399     1,487     (6 )%  
Total segment expenses   71,490     72,126     (1 )%  
               
Segment pre-tax operating income $ 59,058   $ 49,028     20 %  
 

(1) Includes $0.9 million and $1.1 million of depreciation of leased merchandise from intersegment transactions for the six months ended June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated depreciation of leased merchandise for the six months ended June 30, 2024 and 2023 totaled $230.4 million and $204.1 million, respectively.

(2) Includes $0.3 million of provision for lease losses from intersegment transactions for both the six months ended June 30, 2024 and 2023 related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated provision for lease losses for the six months ended June 30, 2024 and 2023 totaled $90.7 million and $101.9 million, respectively.

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
Retail POS Payment Solutions Gross Transaction Volumes (dollars in thousands)
 
  Three Months Ended        
  June 30,   Increase /
  2024   2023   (Decrease)
Leased merchandise $ 146,778   $ 154,103     (5 )%  
Finance receivables   105,258     101,863     3 %  
Total gross transaction volume $ 252,036   $ 255,966     (2 )%  
               
               
  Six Months Ended        
  June 30,   Increase /
    2024     2023   (Decrease)
Leased merchandise $ 300,899   $ 305,278     (1 )%  
Finance receivables   207,422     200,303     4 %  
Total gross transaction volume $ 508,321   $ 505,581     1 %  
Retail POS Payment Solutions Earning Assets (dollars in thousands)
 
  As of June 30,   Increase /
    2024       2023     (Decrease)
Leased merchandise, net:              
Leased merchandise, before allowance for lease losses $ 246,457     $ 255,465       (4 )%  
Less allowance for lease losses   (103,301 )     (110,964 )     (7 )%  
Leased merchandise, net (1) $ 143,156     $ 144,501       (1 )%  
               
Finance receivables, net:              
Finance receivables, before allowance for loan losses $ 205,362     $ 203,609       1 %  
Less allowance for loan losses   (99,961 )     (93,054 )     7 %  
Finance receivables, net $ 105,401     $ 110,555       (5 )%  
 

(1) Includes $0.2 million and $1.4 million of intersegment transactions as of June 30, 2024 and 2023, respectively, related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated net leased merchandise as of June 30, 2024 and 2023 totaled $142.9 million and $143.1 million, respectively.

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
Allowance for Lease and Loan Losses and Other Portfolio Metrics (dollars in thousands)
 
  Three Months Ended        
  June 30,   Increase /
      2024         2023     (Decrease)
Allowance for lease losses:                  
Balance at beginning of period   $ 95,786       $ 93,269       3 %  
Provision for lease losses (1)     47,824         53,048       (10 )%  
Charge-offs     (41,973 )       (37,026 )     13 %  
Recoveries     1,664         1,673       (1 )%  
Balance at end of period   $ 103,301       $ 110,964       (7 )%  
                   
Leased merchandise portfolio metrics:                  
Provision rate (2) 33 %   34 %        
Average monthly net charge-off rate (3) 5.4 %   4.7 %        
Delinquency rate (4) 23.0 %   21.4 %        
                   
Allowance for loan losses:                  
Balance at beginning of period   $ 96,020       $ 88,610       8 %  
Provision for loan losses     31,116         28,190       10 %  
Charge-offs     (28,813 )       (25,274 )     14 %  
Recoveries     1,638         1,528       7 %  
Balance at end of period   $ 99,961       $ 93,054       7 %  
                   
Finance receivables portfolio metrics:                  
Provision rate (2) 30 %   28 %        
Average monthly net charge-off rate (3) 4.5 %   4.0 %        
Delinquency rate (4) 20.0 %   19.1 %        
 

(1) Includes $0.2 million of provision for lease losses from intersegment transactions for both the three months ended June 30, 2024 and 2023 related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated provision for lease losses for the three months ended June 30, 2024 and 2023 totaled $47.7 million and $52.9 million, respectively.

(2) Calculated as provision for lease or loan losses as a percentage of the respective gross transaction volume originated.

(3) Calculated as charge-offs, net of recoveries, as a percentage of the respective average earning asset balance before allowance for lease or loan losses.

(4) Calculated as the percentage of the respective contractual earning asset balance owed that is 1 to 89 days past due (the Company charges off leases and finance receivables when they are 90 days or more contractually past due).

 
FIRSTCASH HOLDINGS, INC.
OPERATING INFORMATION (CONTINUED)
(UNAUDITED)
 
  Six Months Ended        
  June 30,   Increase /
      2024         2023     (Decrease)
Allowance for lease losses:                  
Balance at beginning of period   $ 95,752       $ 79,576       20 %  
Provision for lease losses (1)     91,004         102,214       (11 )%  
Charge-offs     (87,122 )       (74,172 )     17 %  
Recoveries     3,667         3,346       10 %  
Balance at end of period   $ 103,301       $ 110,964       (7 )%  
                   
Leased merchandise portfolio metrics:                  
Provision rate (2) 30 %   33 %        
Average monthly net charge-off rate (3) 5.4 %   4.8 %        
Delinquency rate (4) 23.0 %   21.4 %        
                   
Allowance for loan losses:                  
Balance at beginning of period   $ 96,454       $ 84,833       14 %  
Provision for loan losses     61,534         57,475       7 %  
Charge-offs     (62,092 )       (52,391 )     19 %  
Recoveries     4,065         3,137       30 %  
Balance at end of period   $ 99,961       $ 93,054       7 %  
                   
Finance receivables portfolio metrics:                  
Provision rate (2) 30 %   29 %        
Average monthly net charge-off rate (3) 4.7 %   4.2 %        
Delinquency rate (4) 20.0 %   19.1 %        
 

(1) Includes $0.3 million of provision for lease losses from intersegment transactions for both the six months ended June 30, 2024 and 2023 related to the Company offering AFF’s LTO payment solution in its U.S. pawn stores that are eliminated upon consolidation. Excluding these intersegment transactions, consolidated provision for lease losses for the six months ended June 30, 2024 and 2023 totaled $90.7 million and $101.9 million, respectively.

(2) Calculated as provision for lease or loan losses as a percentage of the respective gross transaction volume originated.

(3) Calculated as charge-offs, net of recoveries, as a percentage of the respective average earning asset balance before allowance for lease or loan losses.

(4) Calculated as the percentage of the respective contractual earning asset balance owed that is 1 to 89 days past due (the Company charges off leases and finance receivables when they are 90 days or more contractually past due).

 
FIRSTCASH HOLDINGS, INC.
PAWN STORE LOCATIONS AND MERCHANT PARTNER LOCATIONS

Pawn Operations

As of June 30, 2024, the Company operated 3,018 pawn store locations composed of 1,201 stores in 29 U.S. states and the District of Columbia, 1,716 stores in 32 states in Mexico, 72 stores in Guatemala, 17 stores in El Salvador and 12 stores in Colombia.

The following tables detail pawn store count activity for the three and six months ended June 30, 2024:

  Three Months Ended June 30, 2024
  U.S.   Latin America   Total
Total locations, beginning of period 1,179     1,818     2,997  
New locations opened (1) 1     20     21  
Locations acquired 26         26  
Consolidation of existing pawn locations (2) (5 )   (21 )   (26 )
Total locations, end of period 1,201     1,817     3,018  
           
           
  Six Months Ended June 30, 2024
  U.S.   Latin America   Total
Total locations, beginning of period 1,183     1,814     2,997  
New locations opened (1) 1     39     40  
Locations acquired 27         27  
Consolidation of existing pawn locations (2) (3) (10 )   (36 )   (46 )
Total locations, end of period 1,201     1,817     3,018  
 

(1) In addition to new store openings, the Company strategically relocated four stores in the U.S. during the three months ended June 30, 2024. During the six months ended June 30, 2024, the Company strategically relocated six stores in the U.S.

(2) Store consolidations were primarily acquired locations over the past seven years which have been combined with overlapping stores and for which the Company expects to maintain a significant portion of the acquired customer base in the consolidated location.

(3) Includes 10 pawnshops located in Acapulco, Mexico that were severely damaged by a hurricane in the fall of 2023 which the Company elected to consolidate with other stores in this market. The Company expects to replace certain of these locations in this market over time as the city’s infrastructure recovers.

Retail POS Payment Solutions

As of June 30, 2024, AFF provided LTO and retail POS payment solutions for consumer goods and services through a network of approximately 12,800 active retail merchant partner locations located in all 50 U.S. states, the District of Columbia and Puerto Rico. This compares to the active door count of approximately 10,500 locations at June 30, 2023.

 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES
(UNAUDITED)
 

The Company uses certain financial calculations such as adjusted net income, adjusted diluted earnings per share, EBITDA, adjusted EBITDA, free cash flow, adjusted free cash flow, adjusted return on equity, adjusted return on assets and constant currency results as factors in the measurement and evaluation of the Company’s operating performance and period-over-period growth. The Company derives these financial calculations on the basis of methodologies other than generally accepted accounting principles (“GAAP”), primarily by excluding from a comparable GAAP measure certain items the Company does not consider to be representative of its actual operating performance. These financial calculations are “non-GAAP financial measures” as defined under the SEC rules. The Company uses these non-GAAP financial measures in operating its business because management believes they are less susceptible to variances in actual operating performance that can result from the excluded items, other infrequent charges and currency fluctuations. The Company presents these financial measures to investors because management believes they are useful to investors in evaluating the primary factors that drive the Company’s core operating performance and provide greater transparency into the Company’s results of operations. However, items that are excluded and other adjustments and assumptions that are made in calculating these non-GAAP financial measures are significant components in understanding and assessing the Company’s financial performance. These non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, the Company’s GAAP financial measures. Further, because these non-GAAP financial measures are not determined in accordance with GAAP, and are thus susceptible to varying calculations, the non-GAAP financial measures, as presented, may not be comparable to other similarly-titled measures of other companies.

While acquisitions are an important part of the Company’s overall strategy, the Company has adjusted the applicable financial calculations to exclude merger and acquisition expenses in order to allow more accurate comparisons of the financial results to prior periods. In addition, the Company does not consider these merger and acquisition expenses to be related to the organic operations of the acquired businesses or its continuing operations, and such expenses are generally not relevant to assessing or estimating the long-term performance of the acquired businesses. Merger and acquisition expenses include incremental costs directly associated with merger and acquisition activities, including professional fees, legal expenses, severance, retention and other employee-related costs, contract breakage costs and costs related to the consolidation of technology systems and corporate facilities, among others.

The Company has certain leases in Mexico which are denominated in U.S. dollars. The lease liability of these U.S. dollar-denominated leases, which is considered a monetary liability, is remeasured into Mexican pesos using current period exchange rates, resulting in the recognition of foreign currency exchange gains or losses. The Company has adjusted the applicable financial measures to exclude these remeasurement gains or losses (i) because they are non-cash, non-operating items that could create volatility in the Company’s consolidated results of operations due to the magnitude of the end of period lease liability being remeasured and (ii) to improve comparability of current periods presented with prior periods.

 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 

Adjusted Net Income and Adjusted Diluted Earnings Per Share

Management believes the presentation of adjusted net income and adjusted diluted earnings per share provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance and prospects for the future by excluding items that management believes are non-operating in nature and are not representative of the Company’s core operating performance. In addition, management believes the adjustments shown below are useful to investors in order to allow them to compare the Company’s financial results for the current periods presented with the prior periods presented.

The following tables provide a reconciliation between net income and diluted earnings per share calculated in accordance with GAAP to adjusted net income and adjusted diluted earnings per share, which are shown net of tax (in thousands, except per share amounts):

                  Trailing Twelve
  Three Months Ended   Six Months Ended Months Ended
  June 30,   June 30, June 30,
  2024     2023       2024       2023       2024       2023  
  In Thousands   In Thousands   In Thousands   In Thousands   In Thousands   In Thousands
Net income, as reported $ 49,073   $ 45,180     $ 110,441     $ 92,568     $ 237,174     $ 231,950  
Adjustments, net of tax:                      
Merger and acquisition expenses   1,047     191       1,504       213       7,380       2,338  
Non-cash foreign currency loss (gain) related to lease liability   1,307     (766 )     1,138       (1,613 )     973       (2,047 )
AFF purchase accounting and other adjustments   9,572     10,887       19,145       21,989       51,497       56,685  
Gain on revaluation of contingent acquisition consideration                               (38,181 )
Other expenses (income), net   899     61       (141 )     96       (1,316 )     214  
Adjusted net income $ 61,898   $ 55,553     $ 132,087     $ 113,253     $ 295,708     $ 250,959  
 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 
  Three Months Ended   Six Months Ended
  June 30,   June 30,
  2024     2023     2024     2023  
  Per Share   Per Share   Per Share   Per Share
Diluted earnings per share, as reported $ 1.08   $ 0.99     $ 2.44   $ 2.01  
Adjustments, net of tax:              
Merger and acquisition expenses   0.03           0.03     0.01  
Non-cash foreign currency loss (gain) related to lease liability   0.03     (0.01 )     0.02     (0.04 )
AFF purchase accounting and other adjustments   0.21     0.24       0.42     0.48  
Other expenses (income), net   0.02                
Adjusted diluted earnings per share $ 1.37   $ 1.22     $ 2.91   $ 2.46  
 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA

The Company defines EBITDA as net income before income taxes, depreciation and amortization, interest expense and interest income and adjusted EBITDA as EBITDA adjusted for certain items, as listed below, that management considers to be non-operating in nature and not representative of its actual operating performance. The Company believes EBITDA and adjusted EBITDA are commonly used by investors to assess a company’s financial performance, and adjusted EBITDA is used as a starting point in the calculation of the consolidated total debt ratio as defined in the Company’s senior unsecured notes. The following table provides a reconciliation of net income to EBITDA and adjusted EBITDA (in thousands):

                            Trailing Twelve
    Three Months Ended   Six Months Ended   Months Ended
    June 30,   June 30,   June 30,
    2024
  2023   2024
  2023   2024
  2023
Net income   $ 49,073     $ 45,180     $ 110,441     $ 92,568     $ 237,174     $ 231,950  
Income taxes     17,105       15,344       37,622       31,169       80,001       68,788  
Depreciation and amortization     26,547       27,050       52,574       54,161       107,574       106,469  
Interest expense     25,187       21,071       50,605       41,968       101,880       80,209  
Interest income     (261 )     (408 )     (1,004 )     (925 )     (1,548 )     (1,340 )
EBITDA     117,651       108,237       250,238       218,941       525,081       486,076  
Adjustments:                                    
Merger and acquisition expenses     1,364       252       1,961       283       9,600       3,043  
Non-cash foreign currency loss (gain) related to lease liability     1,867       (1,095 )     1,626       (2,305 )     1,391       (2,925 )
AFF purchase accounting and other adjustments (1)                             13,968       16,710  
Gain on revaluation of contingent acquisition consideration                                   (46,560 )
Other expenses (income), net     1,000       79       (351 )     124       (1,877 )     278  
Adjusted EBITDA   $ 121,882     $ 107,473     $ 253,474     $ 217,043     $ 548,163     $ 456,622  
 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 
(1)  The following table details AFF purchase accounting and other adjustments (in thousands):                    
                                     
                            Trailing Twelve
    Three Months Ended   Six Months Ended   Months Ended
    June 30,   June 30,   June 30,
    2024   2023   2024   2023   2024   2023
  Amortization of fair value adjustment on acquired finance receivables included in interest and fees on finance receivables $   $   $   $   $   $ 14,970
  Amortization of fair value adjustment on acquired leased merchandise included in depreciation of leased merchandise                       1,740
  Other non-recurring costs included in administrative expenses related to a discontinued finance product                   13,968    
    $   $   $   $   $ 13,968   $ 16,710
 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 

Free Cash Flow and Adjusted Free Cash Flow

For purposes of its internal liquidity assessments, the Company considers free cash flow and adjusted free cash flow. The Company defines free cash flow as cash flow from operating activities less purchases of furniture, fixtures, equipment and improvements and net fundings/repayments of pawn loan and finance receivables, which are considered to be operating in nature by the Company but are included in cash flow from investing activities. Adjusted free cash flow is defined as free cash flow adjusted for merger and acquisition expenses paid that management considers to be non-operating in nature.

Free cash flow and adjusted free cash flow are commonly used by investors as additional measures of cash generated by business operations that may be used to repay scheduled debt maturities and debt service or, following payment of such debt obligations and other non-discretionary items, that may be available to invest in future growth through new business development activities or acquisitions, repurchase stock, pay cash dividends or repay debt obligations prior to their maturities. These metrics can also be used to evaluate the Company’s ability to generate cash flow from business operations and the impact that this cash flow has on the Company’s liquidity. However, free cash flow and adjusted free cash flow have limitations as analytical tools and should not be considered in isolation or as a substitute for cash flow from operating activities or other income statement data prepared in accordance with GAAP. The following table reconciles cash flow from operating activities to free cash flow and adjusted free cash flow (in thousands):

                    Trailing Twelve
    Three Months Ended   Six Months Ended   Months Ended
    June 30,   June 30,   June 30,
      2024       2023       2024       2023       2024       2023  
Cash flow from operating activities   $ 106,187     $ 95,075     $ 228,719     $ 205,669     $ 439,192     $ 448,207  
Cash flow from certain investing activities:                        
Pawn loans, net (1)     (46,036 )     (44,170 )     (20,887 )     188       (56,053 )     (3,364 )
Finance receivables, net     (22,252 )     (32,585 )     (37,563 )     (57,125 )     (95,880 )     (118,932 )
Purchases of furniture, fixtures, equipment and improvements     (16,237 )     (14,520 )     (42,664 )     (28,348 )     (74,464 )     (44,248 )
Free cash flow     21,662       3,800       127,605       120,384       212,795       281,663  
Merger and acquisition expenses paid, net of tax benefit     1,047       191       1,504       213       7,380       2,338  
Adjusted free cash flow   $ 22,709     $ 3,991     $ 129,109     $ 120,597     $ 220,175     $ 284,001  
 

(1) Includes the funding of new loans net of cash repayments and recovery of principal through the sale of inventories acquired from forfeiture of pawn collateral.

 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 

Adjusted Return on Equity and Adjusted Return on Assets

Management believes the presentation of adjusted return on equity and adjusted return on assets provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance by excluding items that management believes are non-operating in nature and not representative of the Company’s core operating performance.

Annualized adjusted return on equity and adjusted return on assets is calculated as follows (dollars in thousands):

  Trailing Twelve
  Months Ended
  June 30, 2024
Adjusted net income (1) $ 295,708  
     
Average stockholders’ equity (average of five most recent quarter-end balances) $ 1,966,910  
Adjusted return on equity (trailing twelve months adjusted net income divided by average equity) 15 %
     
Average total assets (average of five most recent quarter-end balances) $ 4,198,779  
Adjusted return on assets (trailing twelve months adjusted net income divided by average total assets) 7 %
 

(1) See detail of adjustments to net income in the “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section above.

Constant Currency Results

The Company’s reporting currency is the U.S. dollar, however, certain performance metrics discussed in this release are presented on a “constant currency” basis, which is considered a non-GAAP financial measure. The Company’s management uses constant currency results to evaluate operating results of business operations in Latin America, which are transacted in local currencies in Mexico, Guatemala and Colombia. The Company also has operations in El Salvador, where the reporting and functional currency is the U.S. dollar.

The Company believes constant currency results provide valuable supplemental information regarding the underlying performance of its business operations in Latin America, consistent with how the Company’s management evaluates such performance and operating results. Constant currency results reported herein are calculated by translating certain balance sheet and income statement items denominated in local currencies using the exchange rate from the prior-year comparable period, as opposed to the current comparable period, in order to exclude the effects of foreign currency rate fluctuations for purposes of evaluating period-over-period comparisons. See the Latin America pawn segment tables elsewhere in this release for an additional reconciliation of certain constant currency amounts to as reported GAAP amounts.

 
FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
 
Exchange Rates for the Mexican Peso, Guatemalan Quetzal and Colombian Peso
 
  June 30,   Favorable /
  2024   2023   (Unfavorable)
Mexican peso / U.S. dollar exchange rate:              
End-of-period 18.4   17.1     (8 )%  
Three months ended 17.2   17.7     3 %  
Six months ended 17.1   18.2     6 %  
               
Guatemalan quetzal / U.S. dollar exchange rate:              
End-of-period 7.8   7.8     %  
Three months ended 7.8   7.8     %  
Six months ended 7.8   7.8     %  
               
Colombian peso / U.S. dollar exchange rate:              
End-of-period 4,148   4,191     1 %  
Three months ended 3,927   4,431     11 %  
Six months ended 3,921   4,596     15 %  


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