On July 25, 2024, FirstCash Holdings Inc (FCFS, Financial) released its 8-K filing detailing the company's financial performance for the second quarter ended June 30, 2024. FirstCash Holdings Inc operates pawn stores in the United States and Latin America, providing small loans secured by personal property. The company has three reportable segments: U.S. pawn, Latin America pawn, and Retail POS payment solutions (AFF). The majority of its revenue is derived from the U.S. Pawn segment.
Performance Overview
FirstCash Holdings Inc reported a revenue of $831 million for the second quarter, surpassing the analyst estimate of $824.87 million. However, the company's earnings per share (EPS) of $1.08 fell short of the estimated $1.12. The company’s net income for the quarter was $49.07 million, up from $45.18 million in the same period last year.
Segment Highlights
The U.S. pawn segment was a significant driver of growth, with a 25% increase in segment earnings and a 22% rise in pawn fees. The company added 47 new pawn locations during the quarter, including 26 in the U.S. and 21 in Latin America. The Latin America pawn segment saw a slight decline in pre-tax operating income, attributed to increased costs related to wage inflation and store expansion.
Financial Achievements
FirstCash Holdings Inc's balance sheet and cash flows remain robust. The company repurchased $85 million of stock and increased its quarterly cash dividend to $0.38 per share, a 9% increase from the previous quarter. The company’s adjusted EBITDA for the quarter was $121.88 million, up from $107.47 million in the prior-year quarter.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Revenue | $831 million | $750.62 million |
| Net Income | $49.07 million | $45.18 million |
| Diluted EPS | $1.08 | $0.99 |
| Adjusted EBITDA | $121.88 million | $107.47 million |
Balance Sheet and Cash Flow
Operating cash flows for the twelve months ended June 30, 2024, were $439 million, with adjusted free cash flows of $220 million. The company’s long-term financing remains predominantly fixed-rate debt with favorable interest rates ranging from 4.625% to 6.875%, with maturity dates extending from 2028 to 2032.
Challenges and Outlook
Despite the strong performance in the U.S. pawn segment, the Latin America pawn segment faced challenges due to increased costs. The Retail POS payment solutions segment also saw a slight decline in gross transaction volumes. However, the company remains optimistic about its growth prospects, with plans to add approximately 90 to 100 pawn locations in 2024.
"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," stated Rick Wessel, CEO of FirstCash Holdings Inc.
For more detailed information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from FirstCash Holdings Inc for further details.
