Cash America 2003 Annual Report Download - page 7

CASH AM ERICA IN TERN ATIO N AL, IN C.
5
us to significantly expand our reach to a new class of customer and
to new markets. We understand these customers and their needs as
well as anyone in the financial community. And we have the
expertise that mainstream lenders have lost. We have proven our
ability to operate profitably in a business of small transactions
requiring precise execution, astute risk management and customer
attention targeted at building lifelong relationships. We possess
both the cultural affinity and the political will to fight for our
customers’ needs and their right to choose whatever financial
bridge best fits the journey.
Well, so much for my right-brain view through the windshield.
For the more left-brain readers among you, let me translate the last
few paragraphs into a vision you can wrap your arms around.
First, we will continue to refine our core operating model to
become even more attentive to our customers’ needs. The goal is to
provide greater value and reduced transaction times. The value
equation is all about providing customers with the loan amount
they need in the most convenient manner possible. On the pawn
side, we can add value by carefully refining our assessment of
collateral risk. On the cash advance side, underwriting models can
be refined to safely approve loans we are declining today.
Transaction times for both services can be reduced to provide a
more favorable experience for our customers. Technological
innovation, training, marketing and facility design are the key
elements in our plan to meet the challenge of ongoing same-
store growth.
Second, we will leverage the cash flow strength of our existing
store base to expand in both new and existing markets. Our plan
for 2004 calls for opening 40 to 50 de novo cash advance units and
adding approximately 10 to 20 units to our pawnshop base via
acquisitions and start-ups. We expect to invest in this expansion
and fund our traditional maintenance capital expenditures while
reducing long-term debt by the end of 2004.
Third, we will search for opportunities to further consolidate
within both the pawn and cash advance industries. While
significant roll-up opportunities are limited in the pawn industry,
the much younger and rapidly expanding short-term cash advance
industry provides a wide array of candidates. Now that we have
provided a valuation benchmark with the acquisition of Cashland,
we are optimistic about finding additional quality deals at
attractive prices.
Fourth, we will continue to throw new products and services
against the wall until we find those that resonate with our
customers and provide meaningful profit contributions.
Finally, we will intensify our search for ways to serve markets
that are currently closed to us because of unfavorable laws or
regulations. Millions of working-class families in numerous major
metropolitan markets are currently denied access to our solutions
due to well-intended, but misguided public policy. The view
through our windshield frames a day when all citizens will have the
freedom of choice to select a readily available financial bridge to
meet their immediate needs. We believe the market, not public
policy, should govern what solutions provide the best value to the
consumer. We do, however, support expanding the positive
legislation existing in many states today– informed laws and
regulations that shield the consumer from fraud while
concomitantly promoting accessibility by allowing a reasonable
profit incentive to honest providers. We intend to continue
pushing this message until all significant markets are open and
active. This final challenge will be our most difficult, but
potentially most rewarding activity.
Each element of our long-term vision for Cash America is
exposed to risks and uncertainties, and I encourage you to review
those in our filings with the Securities and Exchange Commission.
As I said at the outset, I have never been more comfortable
blending the good news of the past with more encouraging
prospects for the future. We are in a wonderful position right now.
However, as I reflect upon the scars of more difficult messages in
years past, I want to assure you that your team at Cash America
will always “act like we’re behind.”
Thanks for your ongoing support.
Daniel R. Feehan
Chief Executive Officer and President
February 2004