Cash America 2013 Annual Report Download - page 125

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2012 comparison to 2011
Net cash used in investing activities increased $44.7 million, or 9.3%, from $482.0 million in 2011 to $526.7
million in 2012. The primary components of this increase were $78.2 million of cash used for acquisition activities as
described below, an increase of $28.7 million over 2011, and $78.0 million of additional cash used in consumer loan
lending activities, primarily as a result of growth in loans written in the Company’s e-commerce segment. These uses
were offset by a $57.4 million increase in cash provided by pawn lending activities, primarily due to a lower rate of
growth in the Company’s domestic pawn loan portfolio, an increase in pawn loans repaid and lower balances in the
Mexico pawn loan portfolio as a result of the Mexico Reorganization.
The Company completed the acquisition of 37 domestic pawn lending locations in 2012, including the
acquisition of a 25-store chain of pawn lending locations located in Kentucky, North Carolina, and Tennessee and the
acquisition of a nine-store chain of pawn lending locations located in Arizona. In 2011, the Company completed the
acquisition of eight domestic pawn lending locations, including the acquisition of a seven-store chain of pawn lending
locations located in Tucson, Flagstaff and Yuma, Arizona. Consideration for these acquisitions was paid in cash and
funded by available cash and through the Company’s Domestic and Multi-Currency Line of Credit. See “Recent
Developments—2012 Business Developments” for further discussion of the 2012 acquisitions.
Cash Flows from Financing Activities
2013 comparison to 2012
Net cash provided by financing activities increased $82.3 million, from $7.0 million in 2012 to $89.3 million in
2013. The increase was primarily due to a net increase in the proceeds received from issuance of long-term debt of
$248.0 million, mainly from the issuance and sale of $300.0 million of 2018 Senior Notes in May of 2013, which is
discussed in greater detail below. Offsetting this source of cash was a $145.2 million increase in cash used in 2013 for
payments and repurchases of long-term debt, including the repayment of outstanding balances under the Company’s
Domestic and Multi-currency Line of Credit, for other existing indebtedness, including the repurchase, through privately
negotiated transactions, of $12.0 million principal amount of the Company’s senior unsecured convertible notes due
2029 (“2029 Convertible Notes”) for aggregate consideration of $19.8 million plus accrued interest, and for debt
issuance costs incurred in conjunction with the issuance of the 2018 Senior Notes and the amendments to the Domestic
and Multi-currency Line of Credit.
Additionally, the Company used $22.5 million more in 2013 than in 2012 for repurchases of shares of Company
common stock, mostly through open market transactions pursuant to a 2013 authorization by the Company’s Board of
Directors. In 2013, the Company repurchased $47.6 million of the Company’s common shares. See “Share
Repurchases” section below for additional information.
On May 15, 2013, the Company issued and sold the 2018 Senior Notes for an aggregate principal amount of
$300.0 million. The Company offered and sold the 2018 Senior Notes to initial purchasers in reliance on the exemption
from registration provided by Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”). The initial
purchasers then resold the 2018 Senior Notes pursuant to the exemptions from registration under the Securities Act in
reliance on Rule 144A and Regulation S. The 2018 Senior Notes bear interest at a rate of 5.75% per year on the principal
amount, payable semi-annually in arrears on May 15 and November 15 of each year, beginning on November 15, 2013.
The 2018 Senior Notes will mature on May 15, 2018. The 2018 Senior Notes are senior unsecured debt obligations of
the Company. The 2018 Senior Notes are guaranteed by all of the Company’s domestic subsidiaries and one foreign
subsidiary. In connection with a registration rights agreement entered into with the initial purchasers at the time the 2018
Senior Notes were issued, the Company caused a registration statement on Form S-4 to be declared effective by the
Securities and Exchange Commission in January 2014 and has completed an offer to exchange the unregistered 2018
Senior Notes with identical new notes registered under the Securities Act.
In addition, on May 10, 2013, the Company entered into an agreement to amend the terms of its existing
Domestic and Multi-currency Line of Credit. The primary provisions of the amendment to the Domestic and Multi-
currency Line of Credit included an extension of the maturity date from March 31, 2015 to March 31, 2018 and a
decrease in the total credit available from $380.0 million to $280.0 million, subject to an accordion feature whereby the