First Cash 3Q net income up on Mexico strength

AP News
Posted: Oct 19, 2011 6:51 AM
First Cash 3Q net income up on Mexico strength

Pawn-shop chain and payday lender First Cash Financial Services Inc.'s fiscal third-quarter net income rose 30 percent, partly helped by strong results in Mexico and an increase in wholesale scrap jewelry revenue.

The company also lifted its full-year earnings outlook Wednesday, citing its quarterly performance.

First Cash reported net income of $18.4 million, or 59 cents per share, for the three months ended Sept. 30. That's up from $14.2 million, or 46 cents per share, in the same period last year.

Earnings beat the 55 cents per share that analysts surveyed by FactSet expected, on average.

Revenue climbed 26 percent to $133.3 million from $106.1 million as merchandise sales increased and the company made more money from pawn loan fees.

This surpassed Wall Street's $132.3 million revenue forecast.

Revenue at stores open at least a year increased 17 percent _ 20 percent in Mexico and 13 percent in the U.S. This metric is a key gauge of a retailer's health because it excludes results from stores recently opened or closed.

Wholesale scrap jewelry revenue surged 44 percent partly because of an increase in the average selling price for gold of $1,540 per ounce, compared with $1,224 per ounce last year.

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Looking ahead, First Cash now anticipates full-year earnings of $2.23 to $2.25 per share, up from a previous guidance of $2.16 to $2.20 per share. Analysts had predicted $2.22 per share.

First Cash also announced that it is buying a five-store chain of U.S. pawn shops in Indiana for about $4 million. The deal is expected to close in the fourth quarter.

First Cash, based in Arlington, Texas, has 557 retail pawn locations and 110 consumer loan locations in eight U.S. states and 22 states in Mexico.