Cash America 2010 Annual Report Download - page 66
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37
RESULTS OF CONTINUING OPERATIONS
Highlights
The Company’s financial results related to the year ended December 31, 2010 (“2010”) are summarized below.
•Consolidated total revenue increased 15.4%, to $1.3 billion, for 2010 compared to the year ended December 31,
2009 (“2009”), primarily due to increased revenue from higher average consumer loan balances in the e-commerce
segment and to a lesser extent, higher average pawn loan balances and higher proceeds from the disposition of
merchandise in the retail services segment.
•Consolidated net revenue increased 19.9%, to $954.6 million, for 2010 compared to 2009, primarily due to
increased revenue from higher average consumer loan balances in the e-commerce segment and to a lesser extent,
higher average pawn loan balances and higher gross profit on the disposition of merchandise in the retail services
segment.
•Consumer loan fees, net of consumer loan loss provision increased $67.5 million, or 28.0%, in 2010 compared to
2009, primarily due to higher average consumer loan balances in the e-commerce segment, offset slightly by
changes in mix to include more first-time borrowers, as well as growth in international customers, both of which
historically have higher loss rates. The increase was partially offset by additional loan loss provision associated
with the sudden interruption of the MLOC loan portfolio.
•Consolidated operations expenses increased 16.5%, to $419.6 million, in 2010 compared to 2009, primarily due to
increases in personnel and marketing expenses. To a lesser extent, increases were due to charges originating from
the closing of locations and related costs at the Company’s Mexico subsidiary, Prenda Fácil, and due to costs
incurred with the acquisition of Maxit, a 39 store chain of pawn lending locations in Arizona and Washington, as
well as additional costs associated with the sudden interruption of the MLOC loan portfolio.
•Income from operations increased 17.9%, to $207.1 million, in 2010 compared to 2009.
•Net income increased 19.5%, to $115.5 million, in the current year compared to the prior year. Diluted net income
per share was $3.67 in the current year, compared to $3.17 in the prior year.
OVERVIEW
Consolidated Net Revenue, Reduced by Consumer Loan Loss Provision: Consolidated net revenue, reduced by
consumer loan loss provision, is composed of pawn loan fees and service charges from pawn loans plus the profit from
the disposition of merchandise plus consumer loan fees, less the consumer loan loss provision plus other revenue (“loss
adjusted net revenue”). This net figure becomes the income available to satisfy remaining operating and
administrative expenses and is the measure management uses to evaluate top-line performance.