Cash America 2010 Annual Report Download - page 79

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50
YEAR ENDED 2009 COMPARED TO YEAR ENDED 2008
Pawn Lending Activities:
The following table sets forth selected data related to the Company’s pawn lending activities as of and for the
years ended December 31, 2009 and 2008 (dollars in thousands):
2009 2008
Year Ended December 31: Domestic Foreign Total Domestic Foreign Total
Pawn loan fees and service charges $ 200,904 $ 30,274 $ 231,178 $ 183,672 $ 1,323 $ 184,995
Average pawn loan balance outstanding $ 152,800 $ 20,250 $ 173,050 $ 142,400 $ 1,283 $ 143,683
Amount of pawn loans written and renewed $ 629,196 $ 106,569 $ 735,765 $ 591,502 $ 3,313 $ 594,815
Annualized yield on pawn loans 131.5% 149.6% 133.6% 129.0% 103.1% 128.8%
Gross profit margin on disposition of merchandise 35.5% - (a) 35.5% 36.6% - (a) 36.6%
Merchandise turnover 2.9 - (a) 2.9 2.9 - (a) 2.9
As of December 31:
Ending pawn loan balances $ 164,327 $ 23,985 $ 188,312 $ 152,074 $ 16,673 $ 168,747
Ending merchandise balance, net $ 113,824 $ - (a) $ 113,824 $ 109,493 $ - (a) $ 109,493
(
a
)
With respect to the Company’s foreign pawn operations, collateral underlying unredeemed pawn loans is not owned by
the Company; therefore, proceeds from disposition are recorded as pawn loan fees and service charges in the Company’s
consolidated statements of operations.
Pawn loan fees and service charges.Pawn loan balances in domestic locations and foreign locations at
December 31, 2009 were $188.3 million, which was $19.6 million, or 11.6%, higher than at December 31, 2008. The
average balance of pawn loans outstanding for 2009 increased by $29.4 million, or 20.4%, compared to the year ended
December 31, 2008 (“2008”), primarily due to the increase in pawn loan balances due to the acquisition of Prenda
Fácil in the fourth quarter of 2008, as well as an increase in the number of domestic locations offering pawn lending
within the retail services segment.
Pawn loan fees and service charges increased $46.2 million, or 25.0%,to $231.2 million in 2009 from $185.0
million in 2008. The increase is mainly due to higher average pawn loan balances, which contributed $37.8 million of
the increase, and higher annualized yield on pawn loans, which contributed $8.4 million of the increase during 2009.
Annualized pawn loan yield on pawn loans was 133.6% for 2009, compared to 128.8% in 2008. The higher
annualized yield is a function of improved year-over-year performance of the pawn loan portfolio, as cash payments of
fees and service charges on pawn loans were higher, compared to the prior year. The Company’s domestic annualized
loan yield increased to 131.5% in 2009, compared to 129.0% in 2008, mainly due to improved performance in the
portfolio and portfolio mix. The foreign pawn loan yield increased to 149.6% in 2009 from 103.1% in 2008 due to a
higher yield on the liquidation of forfeited loans in 2009.