Cash America 2014 Annual Report Download - page 77

62
YEAR ENDED DECEMBER 31, 2013 COMPARED TO YEAR ENDED DECEMBER 31, 2012
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, 2013 and 2012 (dollars in thousands except where otherwise noted):
Year Ended December 31,
2013 2012 Change % Change
Pawn loan fees and
service charges
$
311,799
$
300,929
$
10,870
3.6
%
Ending pawn loans outstanding (as of December 31,)
$
261,148
$
244,640
$
16,508
6.7
%
Average pawn loans outstanding
$
238,109
$
237,121
$
988
0.4
%
Amount of pawn loans written and renewed
$
1,014,662
$
1,040,478
$
(25,816
)
(2.5
)%
Average amount per pawn loan (in ones)
124
124
—
—
Annualize
d yield on pawn loans
130.9
%
126.9
%
Pawn Loan Fees and Service Charges and Pawn Balances
Consolidated pawn loan balances as of December 31, 2013 were $261.1 million, which was $16.5 million
higher than the balances as of December 31, 2012. Consolidated pawn loan fees and service charges increased
$10.9 million, or 3.6%, to $311.8 million in 2013 from $300.9 million in 2012. The increases in pawn loan balances
and pawn loan fees and service charges were primarily due to increases in pawn loan balances from acquisitions in
the U.S. that the Company made in 2013.
Domestic Pawn Lending
The average balance of pawn loans outstanding during 2013 increased by $8.1 million, or 3.6%, compared
to 2012, primarily due to an increase in the loan balances as a result of the addition of 81 pawn lending locations,
net of closures, through acquisitions and de novo store growth since 2012. The increase was partially offset by
lower average pawn loan balances in same-store locations, which decreased 3.6% in 2013 compared to 2012.
Management believes this decrease is primarily attributable to a reduction in demand for pawn loans by customers.
The average amount per loan decreased to $127 in 2013 from $131 in 2012 and was influenced by a greater mix of
pawn loans being collateralized by non-jewelry merchandise, which generally have a lower average loan amount
than loans collateralized by jewelry.
Pawn loan fees and service charges increased $16.4 million, or 5.7%, to $304.5 million in 2013 compared
to 2012. The increase is primarily due to higher pawn loan yields and higher average pawn loan balances during
2013. The increase in pawn loan yield was primarily due to a greater mix of pawn loans in markets with higher
statutory lending rates on pawn loans and lower forfeiture rates. The increase in average pawn loan balances is
primarily due to acquisitions and de novo store growth in domestic operations.
Foreign Pawn Lending
The average balance of foreign pawn loans outstanding during 2013 decreased by $7.1 million, or 59.0%,
compared to 2012. The decrease was mainly due to the net closure of 148 pawn lending locations in 2012 as part of
the Mexico Reorganization. Consequently, foreign pawn loan fees and service charges decreased $5.5 million, or
42.9%, to $7.3 million in 2013 compared to 2012. However, the annualized yield on pawn loans increased from
105.9% in 2012 to 147.4% in 2013, primarily due to the greater mix in 2013 of general merchandise pawn loans,
which have a higher yield than jewelry-based pawn loans in the Company’s foreign pawn operations.