• Total Revenue: $300.9 million for Q4, up 11% year over year.
• PLO (Pawn Loans Outstanding): $279.2 million, a 14% increase year over year.
• EBITDA: $36.7 million, up 15% from the prior year period.
• Diluted EPS: $0.26 per share, a 13% increase.
• Store Count: 1,279 stores, with 21 new stores added this quarter.
• Cash Balance: $171 million, after paying off convertible notes and share repurchases.
• Merchandise Sales: $165.5 million, a 9% increase.
• Gross Profit: Increased by 12% year over year.
• US Revenue: $212 million for Q4, up 9% year over year.
• Latin America Revenue: $88.9 million, a 17% increase.
• Inventory Turnover Rate: 2.6 times.
• PSC (Pawn Service Charges) Revenue: Increased by 12% year over year.
• EBITDA Margin (US): Improved by 24 basis points to 21%.
• EBITDA (Latin America): $12.7 million, a 50% increase.
• EBITDA Margin (Latin America): Reached 14%, up from 12 basis points.

• Warning! GuruFocus has detected 4 Warning Sign with EZPW.

Release Date: November 14, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• EZCORP Inc (NASDAQ:EZPW) reported record-breaking fiscal Q4 and full-year 2024 results, with total revenue for Q4 reaching $300.9 million, up 11% year over year.
• The company achieved a record PLO of $279.2 million, a 14% increase year over year, demonstrating strong demand for pawn broking services.
• EBITDA increased by 15% to $36.7 million, and diluted EPS climbed 13% to $0.26 per share, indicating strong profitability.
• EZCORP Inc (NASDAQ:EZPW) expanded its store footprint by adding 21 new stores, including 20 in Latin America, supporting its growth strategy.
• The company saw a 44% growth in EZ+ Rewards members, reaching 5.4 million globally, reflecting strong customer engagement and loyalty.

Negative Points

• The company's cash balance declined to $171 million due to paying off a convertible note, increased PLO and inventory, and share repurchases.
• There was a 10% increase in expenses, which partially offset the higher PSC revenue and EBITDA growth.
• The tax rate was higher due to one-off items, including moving money out of Guatemala, which may affect future tax rates as Latin America becomes a larger part of net income.
• The company faced temporary store closures in Florida due to hurricanes, impacting short-term operations.
• Despite strong growth, the company anticipates gross margins to remain at the lower end of the target range due to a focus on inventory turnover.

Q & A Highlights

Q: The tax rate was higher this quarter. Was this a one-time occurrence, or should we expect this to continue? A: Timothy Jugmans, CFO: The higher tax rate was due to some one-off items, including moving money out of Guatemala, which incurred a withholding tax. Going forward, as Latin America becomes a larger part of our net income, there might be slight increases, but it should revert to a more consistent rate.

Q: Can you provide insights on the adoption and future potential of EZ Rewards and EZ payments? A: Lachlan Given, CEO: We have 5.4 million EZ+ members, and while growth is slowing, the focus is now on engaging this customer base. Online payments are improving store efficiency by allowing staff to focus more on customer service. The program is expanding in Mexico and other countries, offering further growth potential.

Q: How have the hurricanes in Florida affected your operations? A: Timothy Jugmans, CFO: We experienced temporary store closures, but our team efficiently reopened them. While there was a short-term slowdown, we expect no long-term impact.

Q: With inflation steadying in the US, are you seeing changes in customer behavior? A: Lachlan Given, CEO: Customer demand remains robust across all regions, with strong growth in loans and sales. Jewelry has been a significant driver, and we remain optimistic about future growth.

Q: Can you discuss the recent acquisition of an auto pawn business in Mexico? A: Lachlan Given, CEO: We are finalizing the acquisition of 53 stores in Mexico. This strategic move addresses the growing importance of auto pawn in the region, where competitors have been successful. We aim to close the deal soon.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.