Cash America 2013 Annual Report Download - page 92

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The table below summarizes the age of merchandise held for disposition related to the Company’s pawn
operations before valuation allowance of $0.9 million as of both December 31, 2013 and 2012, respectively (dollars in
thousands):
As of December 31,
2013 2012
Amount % Amount %
Jewelry – held for one year or less $116,256 55.4 $99,466 59.1
Other merchandise – held for one year or less 79,851 38.1 59,914 35.6
Total merchandise held for one year or less 196,107 93.5 159,380 94.7
Jewelry – held for more than one year 6,734 3.2 3,283 2.0
Other merchandise – held for more than one year 7,007 3.3 5,597 3.3
Total merchandise held for more than one year 13,741 6.5 8,880 5.3
Total merchandise held for disposition $209,848 100.0 $168,260 100.0
Consumer Loan Activities
Consumer Loan Fees
Consumer loan fees increased $96.7 million, or 12.4%, to $878.2 million in 2013 compared to $781.5 million in
2012. The increase in consumer loan fees was primarily due to growth in consumer loan balances in the e-commerce
segment, with domestic e-commerce operations contributing $61.7 million and foreign e-commerce operations
contributing $43.6 million of the consolidated increase. Offsetting the increase from the e-commerce segment was an
$8.6 million decrease in consumer loan fees in the retail services segment, primarily due to a decrease in consumer loan
demand in the Company’s retail services locations and the Texas Consumer Loan Store Closures. See “General—Recent
Developments—2013 Business Developments—Closure of Short-term Consumer Loan Retail Service Locations in
Texas” for further discussion.
Consumer loan fees from the foreign component of the e-commerce segment were 48.4% of consumer loan fees
for the e-commerce segment and 42.2% of consolidated consumer loan fees in 2013, compared to 49.6% of consumer
loan fees for the e-commerce segment and 41.8% of consolidated consumer loan fees in 2012.
Consumer Loan Loss Provision
The consumer loan loss provision increased $35.0 million, or 11.1%, to $351.3 million in 2013 from $316.3
million in 2012, primarily due to the growth and the composition of the consumer loan portfolio in the Company’s
domestic and foreign e-commerce operations. The loss provision as a percentage of consumer loan fees decreased
slightly to 40.0% in 2013 from 40.5% in 2012, primarily because the portfolios had a higher percentage of customers
with established payment histories during 2013 as compared to 2012. New customers tend to have a higher risk of
default than customers with a history of successfully repaying loans. Management expects the loss provision as a
percentage of fees will continue to be influenced by the mix of new and existing customers and the mix of outstanding
loan products.