Cash America 2015 Annual Report Download - page 54

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Operationsexpensesdecreased$23.2million,or5.9%,in2015comparedto2014andincludeda$6.1
million decrease due to the sale of the Company’s Mexico-based operations. Domestic operations expenses
decreased $17.1 million, primarily due to a lower personnel and occupancy cost structure that resulted from the
Reorganization and decreased storefront locations. Operations expenses in 2015 compared to 2014 also benefited
from decreased marketing, selling and office expenses. These decreases were partially offset by increased expenses
in 2015 related to increased performance-based incentive expense and costs incurred to close certain lending
locations and regional offices in 2015.
Administrationexpensesdecreased$12.4million,or12.5%,in2015comparedto2014andincludeda$2.1
million decrease due to the elimination of the Company’s Mexico-based operations. Consistent with the Company’s
strategy to improve marginal profitability, domestic administration expenses decreased $10.3 million, primarily due
to a decrease in personnel expenses following the Reorganization and included decreases in salaries, severance,
health insurance expenses and other employee-related costs. These decreases were partially offset by increased
expenses for the impairment of a capitalized systems development project that the Company discontinued in 2015,
increased consulting expenses and increased performance-based and long-term incentive expenses.
Depreciation and Amortization Expenses
The following table shows the Company’s depreciation and amortization expense for the years ended
December 31, 2015 and 2014 (dollars in thousands):
Year Ended December 31,
2015 2014 $ Change % Change
Depreciation $49,814 $54,358 $(4,544)(8.4)%
Amortization 6,437 6,584 (147)(2.2)%
Total $56,251 $60,942 $(4,691)(7.7)%
Depreciationandamortizationexpensesdecreased$4.7millionin2015comparedto2014,primarilydueto
a reduced number of domestic pawn and consumer lending locations as a result of the closure and sale of certain
store locations, as well as reduced depreciation expenses as a result of the sale of the Company’s Mexico-based
pawn operations in August 2014. The decreased depreciation expenses were partially offset by accelerated
depreciation in 2015 due to the closure of certain lending locations and regional offices. Furthermore, the Company
reduced its level of capital expenditures in 2015 compared to prior years and, as a result, expects that depreciation
expenses will gradually decrease in future periods.
Divestitures
TheCompanyincurredagainondivestituresof$0.3millionin2015duetothesaleof12lendinglocations.
In2014,theCompanyincurredalossondivestituresof$5.2millionthatincluded$4.9millioninaggregatelosses
relatedtothesaleoftheCompany’sMexico-basedpawnoperations,whichwascomposedofa$2.8millionlosson
thesaleanda$2.1millionexpenseforthewrite-off of an uncollectible tax receivable. The loss in 2014 also
includeda$0.3millionlossonthesaleofallfiveoftheCompany’sColoradopawnlendinglocations.
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