Cash America 2009 Annual Report Download - page 62

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Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations.
GENERAL
Cash America International, Inc. (the “Company”) provides specialty financial services to individuals
through its Company-owned and franchised lending locations and check cashing centers and via the internet.
These services include secured non-recourse loans, commonly referred to as pawn loans, short-term unsecured
cash advances, installment loans, credit services, check cashing and related financial services. Finance and
service charges revenue are generated from the Company’s pawn loan portfolio. A related activity of the pawn
lending operations is the disposition of collateral from unredeemed pawn loans and the liquidation of a smaller
volume of merchandise purchased directly from third-parties or from customers. Cash advance fees are generated
from the Company’s cash advance products, from credit service fees generated from customers for loans arranged
with independent third-party lenders through a credit services organization (the “CSO program”) and from the
Company’s card services business through which the Company provides marketing and loan processing services
for a third-party bank issued line of credit on certain stored-value debit cards that the bank issues and purchases a
participation interest in certain line of credit receivables originated by the bank. Check cashing fees are generated
from check cashing and other financial services.
As of December 31, 2009, the Company had 1,048 total locations offering specialty financial services
to its customers in the United States and Mexico. As of December 31, 2009, the Company also offered
specialty financial services over the internet to customers in the United States, United Kingdom, Australia and
Canada. The Company operates in three segments: pawn lending, cash advance and check cashing.
As of December 31, 2009, the Company’s pawn lending operating segment offered secured non-
recourse loans to individuals, commonly referred to as pawn loans, through 676 total pawn lending locations,
including 667 Company-owned units and nine unconsolidated franchised units, consisting of:
• 500 stores that operate in 22 states in the United States under the names “Cash America Pawn” and
“SuperPawn,” and
• 176 stores that operate in 20 jurisdictions in central and southern Mexico under the name “Prenda
Fácil” (referred to as “Prenda Fácil”), of which the Company is a majority owner due to the
December 16, 2008 acquisition (the “Prenda Fácil acquisition”) by the Company of 80% of the
outstanding stock of Creazione Estilo, S.A. de C.V., SOFOM, E.N.R., a Mexican sociedad anónima
de capital variable, sociedad financiera de objeto múltiple, entidad no regulada (“Creazione”).
During the year ended 2009, the Company acquired three pawn lending locations, established 69
locations, and combined or closed three locations for a net increase in Company-owned pawn lending
locations of 69.
As of December 31, 2009, the Company’s cash advance operating segment consisted of:
• 246 cash advance storefront locations in six states in the United States operating under the names “Cash
America Payday Advance” and “Cashland;”
• the Company’s internet channel, which offered short-term cash advances over the internet to customers
in 33 states in the United States at http://www.cashnetusa.com, in the United Kingdom at
http://www.quickquid.co.uk, in Australia at http://www.dollarsdirect.com.au, and in Canada at
http://www.dollarsdirect.ca; and
• the Company’s card services business, which processed line of credit advances on behalf of a third-party
lender and had a participation interest in line of credit receivables that were processed for the lender by
the Company or other third-parties and that were outstanding in all 50 states and three other U.S.