Category: Finance

Source: GlobeNewswire (MIL-OSI)

FORT WORTH, Texas, Oct. 24, 2024 (GLOBE NEWSWIRE) — FirstCash Holdings, Inc. (“FirstCash” or the “Company”) (Nasdaq: FCFS), the leading international operator of more than 3,000 retail pawn stores and a leading provider of retail point-of-sale (“POS”) payment solutions through American First Finance (“AFF”), today announced operating results for the three and nine month periods ended September 30, 2024. The Company also announced that the Board of Directors declared a quarterly cash dividend of $0.38 per share, which will be paid in November 2024.

Mr. Rick Wessel, chief executive officer, stated, “FirstCash achieved record revenue and earnings results for both the third quarter and year-to-date periods. Impressive third quarter achievements also included a fifth consecutive quarter of double-digit growth in same-store pawn receivables for the U.S. pawn segment. The LatAm pawn segment also saw continued growth in local currency pawn revenues and receivables, while AFF recorded a 14% increase in third quarter gross origination volumes driven primarily by 25% growth in new merchant locations.

“Expansion of retail pawn locations continues to be robust as well, with the opening of 16 new pawn stores in the third quarter and the combined opening and acquisition of 83 total stores during the first nine months of this year. Growth in the number of stores and earning assets, coupled with consistent shareholder returns through dividends and share repurchases, continue to be funded primarily through operating cash flows.”

This release contains adjusted financial measures, which exclude certain non-operating and/or non-cash income and expenses, that are non-GAAP financial measures. Please refer to the descriptions and reconciliations to GAAP of these and other non-GAAP financial measures at the end of this release.

		Three Months Ended September 30,
		As Reported (GAAP)						Adjusted (Non-GAAP)
In thousands, except per share amounts		2024			2023			2024			2023
Revenue		$	837,321		$	786,301		$	837,321		$	786,301
Net income		$	64,827		$	57,144		$	75,179		$	70,775
Diluted earnings per share		$	1.44		$	1.26		$	1.67		$	1.56
EBITDA (non-GAAP measure)		$	138,134		$	129,350		$	139,278		$	132,985
Weighted-average diluted shares			44,970			45,374			44,970			45,374

		Nine Months Ended September 30,
		As Reported (GAAP)						Adjusted (Non-GAAP)
In thousands, except per share amounts		2024			2023			2024			2023
Revenue		$	2,504,703		$	2,299,662		$	2,504,703		$	2,299,662
Net income		$	175,268		$	149,712		$	207,266		$	184,028
Diluted earnings per share		$	3.88		$	3.27		$	4.58		$	4.02
EBITDA (non-GAAP measure)		$	388,372		$	348,291		$	392,752		$	350,028
Weighted-average diluted shares			45,214			45,747			45,214			45,747

Consolidated Operating Highlights

• Gross revenues totaled $837 million in the third quarter, an increase of 6% on a U.S. dollar basis and 9% on a constant currency basis compared to the prior-year quarter. Year-to-date revenues totaled $2.5 billion, an increase of 9%, in both dollars and constant currency, compared to the prior-year period.
• Diluted earnings per share for the third quarter increased 14% over the prior-year quarter on a GAAP basis while adjusted diluted earnings per share increased 7% compared to the prior-year quarter. Year-to-date diluted earnings per share increased 19% over the prior-year period on a GAAP basis while adjusted diluted earnings per share increased 14% compared to the prior-year period.
• Net income for the third quarter increased 13% over the prior-year quarter on a GAAP basis while adjusted net income increased 6% compared to the prior-year quarter. Year-to-date, net income totaled $175 million on a GAAP basis while adjusted net income was $207 million. 
• For the trailing twelve month period ended September 30, 2024:
  • Revenues totaled a record $3.4 billion
  • Net income totaled $245 million on a GAAP basis while adjusted net income was $300 million
  • Adjusted EBITDA was $554 million
  • Operating cash flows were $441 million and adjusted free cash flows were $217 million

Store Base and Platform Growth

• Pawn Stores – 16 new pawn locations were added in the third quarter through acquisitions and new store openings. Year-to-date through September 30, 2024, a total of 83 pawn locations have been added:
  • One U.S. store was acquired in Georgia during the third quarter. Year-to-date through September 30, 2024, a total of 29 new locations have opened or been acquired in the U.S.
  • There were 15 new store openings in Latin America in the third quarter which included 11 locations in Mexico and four locations in Guatemala. Year-to-date through September 30, 2024, a total of 54 new locations have opened in Latin America.
  • As of September 30, 2024, the Company had 3,025 locations, comprised of 1,201 U.S. locations and 1,824 locations in Latin America.
• Retail POS Payment Solutions (AFF) Merchant Partnerships – At September 30, 2024, there were approximately 13,500 active retail and e-commerce merchant partner locations, representing a 25% increase in the number of active merchant locations compared to a year ago.

U.S. Pawn Segment Operating Results

• Segment pre-tax operating income in the third quarter of 2024 was a record $98 million, an increase of $14 million, or 16%, compared to the prior-year quarter. The resulting segment pre-tax operating margin was 25% for the third quarter of 2024 which is consistent with the margin for the prior-year quarter.
• Year-to-date segment pre-tax operating income increased by $48 million, or 20%, compared to the prior-year period. The pre-tax operating margin increased to 25% for the year-to-date period, as compared to the 24% margin for the prior-year period.
• Pawn receivables continued to grow to record levels, increasing 12% in total at September 30, 2024 compared to the prior year. The increase in total pawn receivables was driven by a 4% increase in the weighted-average U.S. store count coupled with an impressive 10% same-store increase. The same-store increase was driven by a 7% increase in average loan size and a 3% increase in the number of loans outstanding.
• Pawn loan fees increased 13% for the third quarter and 18% year-to-date, while on a same-store basis, pawn loan fee revenue increased 8% for the quarter and 11% year-to-date compared to the respective prior-year periods. The increased pawn loan fee revenue reflected both store growth and continued growth in demand for pawn loans.
• Retail merchandise sales increased 15% in the third quarter of 2024 compared to the prior-year quarter, while same-store retail sales increased 7% compared to the prior-year quarter.
• Retail sales margins were 43% for the third quarter, improving sequentially over the second quarter and in-line with the prior-year margins. Year-to-date margins were 42% compared to 43% in the prior-year period.
• Annualized inventory turnover was 2.8 times for the trailing twelve months ended September 30, 2024, which equaled the prior-year annualized inventory turnover. Inventories aged greater than one year at September 30, 2024 remained low at 2% of total inventories.
• Operating expenses for the third quarter increased 12% in total due to the 4% weighted-average store count growth over the past year and increased same-store expenses of 6% compared to the prior-year period.

Latin America Pawn Segment Operating Results

Note: Certain growth rates below are calculated on a constant currency basis, a non-GAAP financial measure defined at the end of this release. The average Mexican peso to U.S. dollar exchange rate for the third quarter of 2024 was 18.9 pesos / dollar, an unfavorable change of 11% versus the comparable prior-year period, and for the nine month period ended September 30, 2024 was 17.7 pesos / dollar, a favorable change of 1% versus the prior-year period.

• Third quarter segment pre-tax operating income totaled $38 million, a 6% decline on a U.S. dollar-basis compared to the prior year due primarily to an 11% decline in the Mexican peso exchange rate. On a constant currency basis, segment income increased 2% for the quarter. The resulting pre-tax operating margin was 19% compared to 20% in the prior-year quarter.
• Year-to-date segment pre-tax operating income totaled $107 million, a 4% decline on a U.S. dollar-basis compared to the prior-year period due primarily to increased labor costs and store expansion expenses as described further below. The year-to-date pre-tax operating margin was 18% compared to 19% in the prior-year period.
• While total and same-store pawn loan fees in the third quarter decreased 4% on a U.S. dollar-basis, they increased 6% on a constant currency basis compared to the prior-year quarter. Year-to-date pawn loan fees increased 7%, or 6% on a constant currency basis, compared to the prior-year period. Same-store pawn loan fees were up 6%, both in total and on a constant currency basis, compared to the prior year-to-date period.
• While total and same-store receivables at September 30, 2024 were down 4% on a U.S. dollar basis, they increased 6% on a constant currency basis compared to the prior year.
• Both total and same-store retail merchandise sales in the third quarter of 2024 decreased 3% on a U.S. dollar basis, but increased 7% on a constant currency basis compared to the prior-year quarter. Year-to-date retail merchandise sales increased 4% in total and on a constant currency basis while same-store retail merchandise sales increased 4%, or 3% on a constant currency basis.
• Retail margins were 35% for the third quarter of 2024 compared to 36% in the prior-year quarter. Annualized inventory turnover was 4.2 times for the trailing twelve months ended September 30, 2024 compared to 4.3 times in the prior-year period. Inventories aged greater than one year at September 30, 2024 remained extremely low at 1%.
• Operating expenses decreased 1% in total and 2% on a same-store basis compared to the prior-year quarter. On a constant currency basis, they increased 8% in total and on a same-store basis. The increase in constant currency expenses from all stores reflected increased store counts, accelerated store opening activity and higher labor costs (due primarily to further increases in the federal minimum wage and other mandated benefit programs), along with other inflationary impacts.

American First Finance (AFF) – Retail POS Payment Solutions Segment Operating Results

• Third quarter segment pre-tax operating income totaled $30 million compared to $39 million in the prior-year quarter, as a significant $35 million dollar increase in gross transaction origination volume over the same quarter last year drove an increase in up-front lifetime lease and loan loss provisioning of approximately $10 million.
• Year-to-date segment pre-tax operating income totaled $89 million, a 1% increase over the prior-year period which was also generally consistent with year-to-date gross origination activity.
• Segment revenues for the quarter, comprised of lease-to-own (“LTO”) fees and interest and fees on finance receivables, were flat compared to the prior-year quarter while increasing 4% year-to-date.
• Gross transaction volume of lease and loan originations during the third quarter increased $35 million, or 14%, compared to last year, driven primarily by the 25% increase in active merchant door counts and continued growth in non-furniture verticals. Excluding furniture, third quarter origination volume increased approximately 35%. For the year-to-date period, overall gross transaction volume increased 5% over the same prior-year period and was up 23% excluding furniture.
• Combined gross leased merchandise and finance receivables outstanding at September 30, 2024 increased 1% compared to the September 30, 2023 balances.
• The combined lease and loan loss provision as a percentage of the total gross transaction volume originated was 28% for the third quarter of 2024, compared to the 29% provisioning rate in the third quarter of 2023. The resulting allowance on combined leased merchandise and finance receivables at September 30, 2024 was 44% of gross leased merchandise and receivables, which was consistent with the prior year.
• The average monthly net charge-off (“NCO”) rate for combined leased merchandise and finance receivable products was 5.8% for the third quarter of 2024 and 5.2% for the year-to-date period. While slightly above the prior year, charge-offs remain within the range of forecast expectations.
• Operating expenses were flat compared to the prior-year quarter and the year-to-date period, which was reflective of continued realization of operating synergies.

Cash Flow and Liquidity

• Each of the Company’s business segments generated significant operating cash flows during the twelve month period ended September 30, 2024. Consolidated operating cash flows for the twelve month period ended September 30, 2024 totaled $441 million and adjusted free cash flows (a non-GAAP measure) were $217 million.
• The operating cash flows helped fund significant growth in earning assets and continued investments in the store platform over the past twelve months with a nominal increase in net debt:
  • A total of 36 pawn stores were acquired for a combined purchase price of $82 million.
  • 64 new, or de novo, pawn stores were added with a combined investment of $20 million in fixed assets and working capital.
  • Investments in real estate totaled $78 million as the Company purchased the underlying real estate at 63 of its existing pawn stores, bringing the number of owned properties to over 380 locations.
• In August 2024, the Company amended its U.S. revolving commercial bank credit facility to increase the total lender commitment from $640 million to $700 million with two new banks added to the commercial bank lending group. The term of the facility was extended through August 8, 2029. In addition, the permitted consolidated leverage ratio was increased to 3.25 times adjusted EBITDA for the full term of the agreement, while the other financial covenants remain substantially unchanged.
• Over $1.5 billion of the Company’s long-term financing remains fixed rate debt with favorable interest rates ranging from 4.625% to 6.875% and maturity dates that do not begin until 2028 and continue into 2032.
• Based on trailing twelve month results, the net debt to adjusted EBITDA ratio was 2.96x at September 30, 2024.

Shareholder Returns

• The Board of Directors declared a $0.38 per share fourth quarter cash dividend, which will be paid on November 27, 2024 to stockholders of record as of November 15, 2024. This represents an annualized dividend of $1.52 per share. Any future dividends are subject to approval by the Company’s Board of Directors.
• Year-to-date, the Company has repurchased $85 million of common stock. The Company has $115 million available under the $200 million share repurchase program authorized in July 2023. Future share repurchases are subject to expected liquidity, acquisitions and other investment opportunities, debt covenant restrictions, market conditions and other relevant factors.
• The Company generated a 12% return on equity and a 6% return on assets for the twelve months ended September 30, 2024. Using adjusted net income for the twelve months ended September 30, 2024, the adjusted return on equity was 15% while the adjusted return on assets was 7%.

2024 Outlook

The outlook for the remainder of 2024 continues to be highly positive, with expected year-over-year growth in consolidated revenue and earnings driven by the continued growth in earning asset balances coupled with store additions. Anticipated conditions and trends for the fourth quarter include the following:

Pawn Operations:

• Pawn operations are expected to remain the primary earnings driver in 2024 as the Company expects segment income from the combined U.S. and Latin America pawn segments to be over 80% of total segment level pre-tax income for the full year.
• The company is targeting the addition of approximately 90 total pawn locations for 2024 through a combination of new store openings and acquisitions.

U.S. Pawn

• Pawn receivables were up 12% at September 30, 2024 compared to a year ago, with October balances to date up similarly. Resulting pawn fees are expected to increase in the range of 10% to 12%.
• Retail sales growth is expected to remain in-line with the inventory growth of 10% at the most recent quarter end while retail margins are projected to remain consistent with the year-to-date results.

Latin America Pawn

• Latin America results in the fourth quarter are expected to be negatively impacted by the lower exchange rate for the Mexican peso which has recently been in a range of 19 to 20 pesos per U.S. dollar.
• Pawn loan growth to-date in October is up approximately 8% on a constant currency basis, although down 2% on a U.S. dollar basis as compared to the prior year assuming the current exchange rate. A similar result is projected for constant currency fourth quarter pawn fees.
• Retail sales in Latin America are also expected to increase in-line with inventory growth of 9% on a constant currency basis and are expected to be roughly flat to the prior year on a U.S. dollar basis, assuming the current exchange rate, with consistent retail margins.

Retail POS Payment Solutions (AFF) Operations:

• While weakness in the macro furniture retail environment continues to negatively impact performance from many of its merchant retail partners in the furniture retail vertical, year-over-year growth in gross transaction volumes is still projected for the full year and fourth quarter of 2024, driven by increasing active merchant doors and further expansion of non-furniture verticals. Resulting full year gross revenues for 2024 are expected to remain at or above the prior-year level. AFF now expects furniture to account for less than 40% of 2024 originations compared to almost 50% in 2023.
• The origination and revenue outlook takes into consideration the previously announced bankruptcy filing of Conn’s Home Plus which now assumes minimal originations from November 2024 forward from this merchant relationship.
• Anticipated provision rates (combined provision for lease and loan losses as a percentage of the total gross transaction volume originated) are expected to range between 25% and 28% in the fourth quarter of the year.

Interest Expense, Tax Rates and Currency:

• Interest expense for the fourth quarter is expected to be consistent with the prior year.
• The full year 2024 effective income tax rate under current tax codes in the U.S. and Latin America is expected to range from 24.5% to 25.5%.
• Each full point change in the exchange rate of the Mexican peso represents an annual earnings impact of approximately $0.10 per share.

Additional Commentary and Analysis   

Mr. Wessel provided additional insights on the Company’s third quarter results and outlook for the remainder of 2024, “Our results continue to demonstrate strong fundamental product demand trends which we expect to drive future revenue and earnings growth.

“The U.S. pawn segment again saw continued record levels of demand for pawn loans and record per store loan balances. The 10% growth in same-store pawn receivables is especially strong given that the comparative prior-year comp was 11%. On a stacked, two-year basis, same-store pawn loans are up 21% compared to the third quarter of 2022, illustrating tremendous, continued momentum in the business. Demand trends in October remain strong and we believe lending volumes should continue to also benefit from increased gold prices while our inventories are well positioned for the holiday sales season.

“In Latin America, currency adjusted pawn receivables and pawn fees continued to show impressive growth in the third quarter, with further acceleration to date in October, while third quarter retail sales grew even faster. While the volatility of the Mexican peso slightly impacted third quarter earnings results by approximately $0.04 per share, there is minimal impact on cash flows as we continue to reinvest a large portion of our cash flows in Latin America. We believe in the long term opportunity for Latin America, driven by near-shore manufacturing expansion and the use of pawn loans being an integral part of the economy for our customer base.

“Unit growth in both pawn segments remains exceptional. We have now added 83 stores this year and a total of 240 stores since the beginning of 2023. Looking ahead, we continue to see and evaluate expansion opportunities across markets in both the U.S. and Latin America.

“AFF’s gross transaction volumes in the third quarter improved both sequentially and year-over-year (even when excluding Conn’s Home Plus third quarter closeout volume) with significant contributions from both new doors and expanding non-furniture verticals driven largely by robust productivity from our field sales channel. Excluding furniture, third quarter origination volume increased approximately 35%. This growth has led to a further decrease in large merchant concentration risk, with the largest merchant partner now representing approximately 12% of current total gross transaction volume. Additionally, combined lease and loan losses remain well within our target metrics while the combined reserve remains consistent at over 40% of the total portfolio.

“All of FirstCash’s business segments continue to generate strong cash flows while its balance sheet remains highly liquid. Over 60% of pawn loans are collateralized with jewelry, which is primarily gold and very liquid, while almost 50% of retail inventories are comprised of jewelry that typically has the highest margins. Our balance sheet maintains favorable unsecured financing featuring long-dated maturities at attractive rates. Accordingly, we believe that we are well positioned to drive continued shareholder value through organic store growth, strategic acquisitions, dividends and share repurchases,” concluded Mr. Wessel.

About FirstCash

FirstCash is the leading international operator of pawn stores focused on serving cash and credit-constrained consumers. FirstCash’s more than 3,000 pawn stores in the U.S. and Latin America buy and sell a wide variety of jewelry, electronics, tools, appliances, sporting goods, musical instruments and other merchandise, and make small non-recourse pawn loans secured by pledged personal property. FirstCash’s pawn segments in the U.S. and Latin America currently account for approximately 80% of segment earnings, with the remainder provided by its wholly owned subsidiary, AFF, which provides lease-to-own and retail finance payment solutions for consumer goods and services.

FirstCash is a component company in both the Standard & Poor’s MidCap 400 Index® and the Russell 2000 Index®. FirstCash’s common stock (ticker symbol “FCFS”) is traded on the Nasdaq, the creator of the world’s first electronic stock market. For additional information regarding FirstCash and the services it provides, visit FirstCash’s websites located at http://www.firstcash.com and http://www.americanfirstfinance.com.

Forward-Looking Information     

This release contains forward-looking statements about the business, financial condition, outlook and prospects of FirstCash Holdings, Inc. and its wholly owned subsidiaries (together, the “Company”), including the Company’s outlook for 2024. Forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, can be identified by the use of forward-looking terminology such as “outlook,” “believes,” “projects,” “expects,” “may,” “estimates,” “should,” “plans,” “targets,” “intends,” “could,” “would,” “anticipates,” “potential,” “confident,” “optimistic,” or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy, objectives, estimates, guidance, expectations, outlook and future plans. Forward-looking statements can also be identified by the fact these statements do not relate strictly to historical or current matters. Rather, forward-looking statements relate to anticipated or expected events, activities, trends or results. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties.

While the Company believes the expectations reflected in forward-looking statements are reasonable, there can be no assurances such expectations will prove to be accurate. Security holders are cautioned that such forward-looking statements involve risks and uncertainties. Certain factors may cause results to differ materially from those anticipated by the forward-looking statements made in this release. Such factors may include, without limitation, risks related to the extensive regulatory environment in which the Company operates; risks associated with the legal and regulatory proceedings that the Company is a party to or may become a party to in the future, including the Consumer Financial Protection Bureau (the “CFPB”) lawsuit filed against the Company; risks related to the Company’s acquisitions, including the failure of the Company’s acquisitions to deliver the estimated value and benefits expected by the Company and the ability of the Company to continue to identify and consummate acquisitions on favorable terms, if at all; potential changes in consumer behavior and shopping patterns which could impact demand for the Company’s pawn loan, retail, lease-to-own (“LTO”) and retail finance products; labor shortages and increased labor costs; a deterioration in the economic conditions in the United States and Latin America, including as a result of inflation, elevated interest rates and higher gas prices, which potentially could have an impact on discretionary consumer spending and demand for the Company’s products; currency fluctuations, primarily involving the Mexican peso; competition the Company faces from other retailers and providers of retail payment solutions; the ability of the Company to successfully execute on its business strategies; contraction in sales activity at merchant partners of the Company’s retail POS payment solutions business; impact of store closures, financial difficulties or even bankruptcies at the merchant partners of the Company’s retail POS payment solutions business; and other risks discussed and described in the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”), including the risks described in Part 1, Item 1A, “Risk Factors” thereof, and other reports filed with the SEC. Many of these risks and uncertainties are beyond the ability of the Company to control, nor can the Company predict, in many cases, all of the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements. The forward-looking statements contained in this release speak only as of the date of this release, and the Company expressly disclaims any obligation or undertaking to report any updates or revisions to any such statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

FIRSTCASH HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2024				2023				2024				2023
Revenue:
Retail merchandise sales	$	363,141			$	335,081			$	1,093,425			$	983,860
Pawn loan fees		186,561				174,560				547,142				480,298
Leased merchandise income		188,560				189,382				588,801				562,625
Interest and fees on finance receivables		61,198				61,413				175,384				174,247
Wholesale scrap jewelry sales		37,861				25,865				99,951				98,632
Total revenue		837,321				786,301				2,504,703				2,299,662
Cost of revenue:
Cost of retail merchandise sold		218,178				199,719				659,854				590,991
Depreciation of leased merchandise		104,928				103,698				335,369				307,824
Provision for lease losses		39,171				39,736				129,834				141,674
Provision for loan losses		40,557				33,096				102,091				90,571
Cost of wholesale scrap jewelry sold		29,880				21,405				81,711				79,012
Total cost of revenue		432,714				397,654				1,308,859				1,210,072
Net revenue		404,607				388,647				1,195,844				1,089,590
Expenses and other income:
Operating expenses		224,926				211,524				674,431				615,366
Administrative expenses		40,930				45,056				129,563				124,428
Depreciation and amortization		25,933				27,365				78,507				81,526
Interest expense		27,424				24,689				78,029				66,657
Interest income		(403	)			(328	)			(1,407	)			(1,253	)
Loss (gain) on foreign exchange		882				(286	)			2,133				(1,905	)
Merger and acquisition expenses		225				3,387				2,186				3,670
Other expenses (income), net		(490	)			(384	)			(841	)			(260	)
Total expenses and other income		319,427				311,023				962,601				888,229
Income before income taxes		85,180				77,624				233,243				201,361
Provision for income taxes		20,353				20,480				57,975				51,649
Net income	$	64,827			$	57,144			$	175,268			$	149,712

FIRSTCASH HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
	September 30,								December 31,
	2024				2023				2023
ASSETS
Cash and cash equivalents	$	106,320			$	86,547			$	127,018
Accounts receivable, net		74,378				72,336				71,922
Pawn loans		517,877				483,785				471,846
Finance receivables, net		123,751				113,307				113,901
Inventories		334,394				314,382				312,089
Leased merchandise, net		137,769				143,169				171,191
Prepaid expenses and other current assets		34,861				21,114				38,634
Total current assets		1,329,350				1,234,640				1,306,601
Property and equipment, net		689,075				604,673				632,724
Operating lease right of use asset		329,228				312,097				328,458
Goodwill		1,788,795				1,713,354				1,727,652
Intangible assets, net		241,389				291,690				277,724
Other assets		10,339				10,057				10,242
Deferred tax assets, net		4,671				8,052				6,514
Total assets	$	4,392,847			$	4,174,563			$	4,289,915
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued liabilities	$	133,792			$	146,873			$	163,050
Customer deposits and prepayments		78,083				71,752				70,580
Lease liability, current		96,598				98,745				101,962
Total current liabilities		308,473				317,370				335,592
Revolving unsecured credit facilities		200,000				560,229				568,000
Senior unsecured notes		1,530,604				1,037,151				1,037,647
Deferred tax liabilities, net		127,425				139,713				136,773
Lease liability, non-current		227,151				202,516				215,485
Total liabilities		2,393,653				2,256,979				2,293,497
Stockholders’ equity:
Common stock		575				573				573
Additional paid-in capital		1,764,351				1,737,497				1,741,046
Retained earnings		1,344,542				1,164,228				1,218,029
Accumulated other comprehensive loss		(114,807	)			(64,521	)			(43,037	)
Common stock held in treasury, at cost		(995,467	)			(920,193	)			(920,193	)
Total stockholders’ equity		1,999,194				1,917,584				1,996,418
Total liabilities and stockholders’ equity	$	4,392,847			$	4,174,563			$	4,289,915

FIRSTCASH HOLDINGS, INC.
U.S. PAWN SEGMENT RESULTS
(UNAUDITED)
U.S. Pawn Operating Results and Margins (dollars in thousands)
	Three Months Ended
	September 30,
	2024				2023				Increase
Revenue:
Retail merchandise sales	$	235,037			$	203,769				15	%
Pawn loan fees		128,393				114,022				13	%
Wholesale scrap jewelry sales		26,685				17,140				56	%
Total revenue		390,115				334,931				16	%
Cost of revenue:
Cost of retail merchandise sold		134,966				115,670				17	%
Cost of wholesale scrap jewelry sold		21,393				14,297				50	%
Total cost of revenue		156,359				129,967				20	%
Net revenue		233,756				204,964				14	%
Segment expenses:
Operating expenses		128,104				113,976				12	%
Depreciation and amortization		7,365				6,586				12	%
Total segment expenses		135,469				120,562				12	%
Segment pre-tax operating income	$	98,287			$	84,402				16	%
Operating metrics:
Retail merchandise sales margin	43		%		43		%
Net revenue margin	60		%		61		%
Segment pre-tax operating margin	25		%		25		%

FIRSTCASH HOLDINGS, INC.
U.S. PAWN SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
	Nine Months Ended
	September 30,
	2024				2023				Increase
Revenue:
Retail merchandise sales	$	702,120			$	610,493				15	%
Pawn loan fees		371,699				315,679				18	%
Wholesale scrap jewelry sales		70,722				61,108				16	%
Total revenue		1,144,541				987,280				16	%
Cost of revenue:
Cost of retail merchandise sold		407,329				349,138				17	%
Cost of wholesale scrap jewelry sold		57,928				49,604				17	%
Total cost of revenue		465,257				398,742				17	%
Net revenue		679,284				588,538				15	%
Segment expenses:
Operating expenses		372,191				331,916				12	%
Depreciation and amortization		21,609				18,786				15	%
Total segment expenses		393,800				350,702				12	%
Segment pre-tax operating income	$	285,484			$	237,836				20	%
Operating metrics:
Retail merchandise sales margin	42		%		43		%
Net revenue margin	59		%		60		%
Segment pre-tax operating margin	25		%		24		%

FIRSTCASH HOLDINGS, INC.
U.S. PAWN SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
U.S. Pawn Earning Assets and Portfolio Metrics (dollars in thousands, except as otherwise noted)
	As of September 30,
	2024				2023				Increase
Earning assets:
Pawn loans	$	380,962			$	341,123				12	%
Inventories		238,668				217,406				10	%
	$	619,630			$	558,529				11	%
Average outstanding pawn loan amount (in ones)	$	264			$	245				8	%
Composition of pawn collateral:
General merchandise	30		%		31		%
Jewelry	70		%		69		%
	100		%		100		%
Composition of inventories:
General merchandise	43		%		45		%
Jewelry	57		%		55		%
	100		%		100		%
Percentage of inventory aged greater than one year	2		%		1		%
Inventory turns (trailing twelve months cost of merchandise sales divided by average inventories)	2.8 times				2.8 times

FIRSTCASH HOLDINGS, INC.
LATIN AMERICA PAWN SEGMENT RESULTS
(UNAUDITED)
Constant currency results are non-GAAP financial measures, which exclude the effects of foreign currency translation and are calculated by translating current-year results at prior-year average exchange rates. See the “Constant Currency Results” section below for additional discussion of constant currency operating results.
Latin America Pawn Operating Results and Margins (dollars in thousands)
																Constant Currency Basis
																Three Months
																Ended
		Three Months Ended														September 30,				Increase /
		September 30,									Increase /					2024				(Decrease)
		2024					2023				(Decrease)					(Non-GAAP)				(Non-GAAP)
Revenue:
Retail merchandise sales		$	129,081				$	132,784				(3	)%			$	142,147				7	%
Pawn loan fees			58,168					60,538				(4	)%				64,130				6	%
Wholesale scrap jewelry sales			11,176					8,725				28	%				11,176				28	%
Total revenue			198,425					202,047				(2	)%				217,453				8	%
Cost of revenue:
Cost of retail merchandise sold			83,729					84,816				(1	)%				92,131				9	%
Cost of wholesale scrap jewelry sold			8,487					7,108				19	%				9,378				32	%
Total cost of revenue			92,216					91,924				—	%				101,509				10	%
Net revenue			106,209					110,123				(4	)%				115,944				5	%
Segment expenses:
Operating expenses			63,062					63,907				(1	)%				69,199				8	%
Depreciation and amortization			4,676					5,236				(11	)%				5,117				(2	)%
Total segment expenses			67,738					69,143				(2	)%				74,316				7	%
Segment pre-tax operating income		$	38,471				$	40,980				(6	)%			$	41,628				2	%
Operating metrics:
Retail merchandise sales margin	35			%		36			%						35			%
Net revenue margin	54			%		55			%						53			%
Segment pre-tax operating margin	19			%		20			%						19			%

FIRSTCASH HOLDINGS, INC.
LATIN AMERICA PAWN SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
																Constant Currency Basis
																Nine Months
																Ended
		Nine Months Ended														September 30,				Increase /
		September 30,									Increase /					2024				(Decrease)
		2024					2023				(Decrease)					(Non-GAAP)				(Non-GAAP)
Revenue:
Retail merchandise sales		$	394,375				$	378,302				4	%			$	391,606				4	%
Pawn loan fees			175,443					164,619				7	%				174,228				6	%
Wholesale scrap jewelry sales			29,229					37,524				(22	)%				29,229				(22	)%
Total revenue			599,047					580,445				3	%				595,063				3	%
Cost of revenue:
Cost of retail merchandise sold			254,188					244,439				4	%				252,377				3	%
Cost of wholesale scrap jewelry sold			23,783					29,408				(19	)%				23,627				(20	)%
Total cost of revenue			277,971					273,847				2	%				276,004				1	%
Net revenue			321,076					306,598				5	%				319,059				4	%
Segment expenses:
Operating expenses			198,389					179,170				11	%				196,986				10	%
Depreciation and amortization			15,199					15,884				(4	)%				15,072				(5	)%
Total segment expenses			213,588					195,054				10	%				212,058				9	%
Segment pre-tax operating income		$	107,488				$	111,544				(4	)%			$	107,001				(4	)%
Operating metrics:
Retail merchandise sales margin	36			%		35			%						36			%
Net revenue margin	54			%		53			%						54			%
Segment pre-tax operating margin	18			%		19			%						18			%

FIRSTCASH HOLDINGS, INC.
LATIN AMERICA PAWN SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
Latin America Pawn Earning Assets and Portfolio Metrics (dollars in thousands, except as otherwise noted)
													Constant Currency Basis
													As of
													September 30,
	As of September 30,												2024			Increase
	2024				2023				(Decrease)				(Non-GAAP)			(Non-GAAP)
Earning assets:
Pawn loans	$	136,915			$	142,662				(4	)%		$	151,486			6	%
Inventories		95,726				96,976				(1	)%			105,792			9	%
	$	232,641			$	239,638				(3	)%		$	257,278			7	%
Average outstanding pawn loan amount (in ones)	$	85			$	89				(4	)%		$	94			6	%
Composition of pawn collateral:
General merchandise	62		%		66		%
Jewelry	38		%		34		%
	100		%		100		%
Composition of inventories:
General merchandise	70		%		68		%
Jewelry	30		%		32		%
	100		%		100		%
Percentage of inventory aged greater than one year	1		%		1		%
Inventory turns (trailing twelve months cost of merchandise sales divided by average inventories)	4.2 times				4.3 times

FIRSTCASH HOLDINGS, INC.
RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS
(UNAUDITED)
Retail POS Payment Solutions Operating Results (dollars in thousands)
	Three Months Ended
	September 30,						Increase /
	2024			2023			(Decrease)
Revenue:
Leased merchandise income	$	188,560		$	189,382			—	%
Interest and fees on finance receivables		61,198			61,413			—	%
Total revenue		249,758			250,795			—	%
Cost of revenue:
Depreciation of leased merchandise		105,308			104,198			1	%
Provision for lease losses		39,268			39,640			(1	)%
Provision for loan losses		40,557			33,096			23	%
Total cost of revenue		185,133			176,934			5	%
Net revenue		64,625			73,861			(13	)%
Segment expenses:
Operating expenses		33,760			33,641			—	%
Depreciation and amortization		679			771			(12	)%
Total segment expenses		34,439			34,412			—	%
Segment pre-tax operating income	$	30,186		$	39,449			(23	)%

FIRSTCASH HOLDINGS, INC.
RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
	Nine Months Ended
	September 30,						Increase /
	2024			2023			(Decrease)
Revenue:
Leased merchandise income	$	588,801		$	562,625			5	%
Interest and fees on finance receivables		175,384			174,247			1	%
Total revenue		764,185			736,872			4	%
Cost of revenue:
Depreciation of leased merchandise		336,649			309,432			9	%
Provision for lease losses		130,272			141,854			(8	)%
Provision for loan losses		102,091			90,571			13	%
Total cost of revenue		569,012			541,857			5	%
Net revenue		195,173			195,015			—	%
Segment expenses:
Operating expenses		103,851			104,280			—	%
Depreciation and amortization		2,078			2,258			(8	)%
Total segment expenses		105,929			106,538			(1	)%
Segment pre-tax operating income	$	89,244		$	88,477			1	%

FIRSTCASH HOLDINGS, INC.
RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
Retail POS Payment Solutions Gross Transaction Volumes (dollars in thousands)
	Three Months Ended
	September 30,						Increase /
	2024			2023			(Decrease)
Leased merchandise	$	143,146		$	147,513			(3	)%
Finance receivables		142,910			103,183			39	%
Total gross transaction volume	$	286,056		$	250,696			14	%
	Nine Months Ended
	September 30,						Increase /
	2024			2023			(Decrease)
Leased merchandise	$	444,045		$	452,792			(2	)%
Finance receivables		350,332			303,485			15	%
Total gross transaction volume	$	794,377		$	756,277			5	%

Retail POS Payment Solutions Earning Assets (dollars in thousands)
	As of September 30,								Increase /
	2024				2023				(Decrease)
Leased merchandise, net:
Leased merchandise, before allowance for lease losses	$	231,796			$	250,298				(7	)%
Less allowance for lease losses		(93,823	)			(105,472	)			(11	)%
Leased merchandise, net	$	137,973			$	144,826				(5	)%
Finance receivables, net:
Finance receivables, before allowance for loan losses	$	232,948			$	209,991				11	%
Less allowance for loan losses		(109,197	)			(96,684	)			13	%
Finance receivables, net	$	123,751			$	113,307				9	%

FIRSTCASH HOLDINGS, INC.
RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
Allowance for Lease and Loan Losses and Other Portfolio Metrics (dollars in thousands)
	Three Months Ended
	September 30,										Increase /
		2024					2023				(Decrease)
Allowance for lease losses:
Balance at beginning of period		$	103,301				$	110,964				(7	)%
Provision for lease losses			39,268					39,640				(1	)%
Charge-offs			(50,394	)				(46,794	)			8	%
Recoveries			1,648					1,662				(1	)%
Balance at end of period		$	93,823				$	105,472				(11	)%
Leased merchandise portfolio metrics:
Provision rate(1)	27			%		27			%
Average monthly net charge-off rate(2)	6.8			%		5.9			%
Delinquency rate(3)	23.6			%		23.2			%
Allowance for loan losses:
Balance at beginning of period		$	99,961				$	93,054				7	%
Provision for loan losses			40,557					33,096				23	%
Charge-offs			(32,969	)				(30,890	)			7	%
Recoveries			1,648					1,424				16	%
Balance at end of period		$	109,197				$	96,684				13	%
Finance receivables portfolio metrics:
Provision rate(1)	28			%		32			%
Average monthly net charge-off rate(2)	4.8			%		4.7			%
Delinquency rate(3)	19.4			%		21.9			%

⁽¹⁾   Calculated as provision for lease or loan losses as a percentage of the respective gross transaction volume originated.
⁽²⁾   Calculated as charge-offs, net of recoveries, as a percentage of the respective average earning asset balance before allowance for lease or loan losses.
⁽³⁾   Calculated as the percentage of the respective contractual earning asset balance owed that is 1 to 89 days past due (the Company charges off leases and finance receivables when they are 90 days or more contractually past due).

FIRSTCASH HOLDINGS, INC.
RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
(UNAUDITED)
	Nine Months Ended
	September 30,										Increase /
		2024					2023				(Decrease)
Allowance for lease losses:
Balance at beginning of period		$	95,752				$	79,576				20	%
Provision for lease losses			130,272					141,854				(8	)%
Charge-offs			(137,516	)				(120,966	)			14	%
Recoveries			5,315					5,008				6	%
Balance at end of period		$	93,823				$	105,472				(11	)%
Leased merchandise portfolio metrics:
Provision rate(1)	29			%		31			%
Average monthly net charge-off rate(2)	5.9			%		5.3			%
Delinquency rate(3)	23.6			%		23.2			%
Allowance for loan losses:
Balance at beginning of period		$	96,454				$	84,833				14	%
Provision for loan losses			102,091					90,571				13	%
Charge-offs			(95,061	)				(83,281	)			14	%
Recoveries			5,713					4,561				25	%
Balance at end of period		$	109,197				$	96,684				13	%
Finance receivables portfolio metrics:
Provision rate(1)	29			%		30			%
Average monthly net charge-off rate(2)	4.5			%		4.4			%
Delinquency rate(3)	19.4			%		21.9			%

⁽¹⁾   Calculated as provision for lease or loan losses as a percentage of the respective gross transaction volume originated.
⁽²⁾   Calculated as charge-offs, net of recoveries, as a percentage of the respective average earning asset balance before allowance for lease or loan losses.
⁽³⁾   Calculated as the percentage of the respective contractual earning asset balance owed that is 1 to 89 days past due (the Company charges off leases and finance receivables when they are 90 days or more contractually past due).

FIRSTCASH HOLDINGS, INC.
PAWN STORE LOCATIONS AND MERCHANT PARTNER LOCATIONS
Pawn Operations
As of September 30, 2024, the Company operated 3,025 pawn store locations composed of 1,201 stores in 29 U.S. states and the District of Columbia, 1,723 stores in 32 states in Mexico, 72 stores in Guatemala, 17 stores in El Salvador and 12 stores in Colombia.
The following tables detail pawn store count activity for the three and nine months ended September 30, 2024:
	Three Months Ended September 30, 2024
	U.S.			Latin America			Total
Total locations, beginning of period	1,201			1,817			3,018
New locations opened(1)	—			15			15
Locations acquired	1			—			1
Consolidation of existing pawn locations(2)	(1	)		(8	)		(9	)
Total locations, end of period	1,201			1,824			3,025
	Nine Months Ended September 30, 2024
	U.S.			Latin America			Total
Total locations, beginning of period	1,183			1,814			2,997
New locations opened(1)	1			54			55
Locations acquired	28			—			28
Consolidation of existing pawn locations(2) (3)	(11	)		(44	)		(55	)
Total locations, end of period	1,201			1,824			3,025

⁽¹⁾   In addition to new store openings, the Company strategically relocated three stores in the U.S. and one store in Latin America during the three months ended September 30, 2024. During the nine months ended September 30, 2024, the Company strategically relocated nine stores in the U.S and one store in Latin America.
⁽²⁾   Store consolidations were primarily acquired locations which have been combined with overlapping stores and for which the Company expects to maintain a significant portion of the acquired customer base in the consolidated location.
⁽³⁾   Includes 10 pawnshops located in Acapulco, Mexico that were severely damaged by a hurricane in the fall of 2023 which the Company elected to consolidate with other stores in this market. The Company expects to replace certain of these locations in this market over time as the city’s infrastructure recovers.

Retail POS Payment Solutions

As of September 30, 2024, AFF provided LTO and retail POS payment solutions for consumer goods and services through a network of approximately 13,500 active retail merchant partner locations located in all 50 U.S. states, the District of Columbia and Puerto Rico. This compares to the active door count of approximately 10,800 locations at September 30, 2023.

FIRSTCASH HOLDINGS, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (UNAUDITED)

The Company uses certain financial calculations such as adjusted net income, adjusted diluted earnings per share, EBITDA, adjusted EBITDA, free cash flow, adjusted free cash flow, adjusted return on equity, adjusted return on assets and constant currency results as factors in the measurement and evaluation of the Company’s operating performance and period-over-period growth. The Company derives these financial calculations on the basis of methodologies other than generally accepted accounting principles (“GAAP”), primarily by excluding from a comparable GAAP measure certain items the Company does not consider to be representative of its actual operating performance. These financial calculations are “non-GAAP financial measures” as defined under the SEC rules. The Company uses these non-GAAP financial measures in operating its business because management believes they are less susceptible to variances in actual operating performance that can result from the excluded items, other infrequent charges and currency fluctuations. The Company presents these financial measures to investors because management believes they are useful to investors in evaluating the primary factors that drive the Company’s core operating performance and provide greater transparency into the Company’s results of operations. However, items that are excluded and other adjustments and assumptions that are made in calculating these non-GAAP financial measures are significant components in understanding and assessing the Company’s financial performance. These non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, the Company’s GAAP financial measures. Further, because these non-GAAP financial measures are not determined in accordance with GAAP, and are thus susceptible to varying calculations, the non-GAAP financial measures, as presented, may not be comparable to other similarly-titled measures of other companies.

While acquisitions are an important part of the Company’s overall strategy, the Company has adjusted the applicable financial calculations to exclude merger and acquisition expenses and amortization of acquired AFF intangible assets. The Company does not consider these items to be related to the organic operations of the acquired businesses or its continuing operations and are generally not relevant to assessing or estimating the long-term performance of the acquired businesses. In addition, excluding these items allows for more accurate comparisons of the financial results to prior periods. Merger and acquisition expenses include incremental costs directly associated with merger and acquisition activities, including professional fees, legal expenses, severance, retention and other employee-related costs, contract breakage costs and costs related to the consolidation of technology systems and corporate facilities, among others.

The Company has certain leases in Mexico which are denominated in U.S. dollars. The lease liability of these U.S. dollar-denominated leases, which is considered a monetary liability, is remeasured into Mexican pesos using current period exchange rates, resulting in the recognition of foreign currency exchange gains or losses. The Company has adjusted the applicable financial measures to exclude these remeasurement gains or losses (i) because they are non-cash, non-operating items that could create volatility in the Company’s consolidated results of operations due to the magnitude of the end of period lease liability being remeasured and (ii) to improve comparability of current periods presented with prior periods.

FIRSTCASH HOLDINGS, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (CONTINUED) (UNAUDITED)

Adjusted Net Income and Adjusted Diluted Earnings Per Share

Management believes the presentation of adjusted net income and adjusted diluted earnings per share provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance and prospects for the future by excluding items that management believes are non-operating in nature and are not representative of the Company’s core operating performance. In addition, management believes the adjustments shown below are useful to investors in order to allow them to compare the Company’s financial results for the current periods presented with the prior periods presented.

The following tables provide a reconciliation between net income and diluted earnings per share calculated in accordance with GAAP to adjusted net income and adjusted diluted earnings per share, which are shown net of tax (in thousands, except per share amounts):

																	Trailing Twelve
	Three Months Ended								Nine Months Ended								Months Ended
	September 30,								September 30,								September 30,
	2024				2023				2024				2023				2024				2023
	In Thousands				In Thousands				In Thousands				In Thousands				In Thousands				In Thousands
Net income, as reported	$	64,827			$	57,144			$	175,268			$	149,712			$	244,857			$	229,778
Adjustments, net of tax:
Merger and acquisition expenses		171				2,605				1,675				2,818				4,946				4,379
Non-cash foreign currency loss (gain) related to lease liability		986				442				2,124				(1,171	)			1,517				(1,856	)
AFF purchase accounting and other adjustments		9,572				10,880				28,717				32,869				50,189				50,529
Gain on revaluation of contingent acquisition consideration		—				—				—				—				—				(21,952	)
Other expenses (income), net		(377	)			(296	)			(518	)			(200	)			(1,397	)			(208	)
Adjusted net income	$	75,179			$	70,775			$	207,266			$	184,028			$	300,112			$	260,670

FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
	Three Months Ended								Nine Months Ended
	September 30,								September 30,
	2024				2023				2024				2023
	Per Share				Per Share				Per Share				Per Share
Diluted earnings per share, as reported	$	1.44			$	1.26			$	3.88			$	3.27
Adjustments, net of tax:
Merger and acquisition expenses		0.01				0.06				0.04				0.06
Non-cash foreign currency loss (gain) related to lease liability		0.02				0.01				0.05				(0.03	)
AFF purchase accounting and other adjustments		0.21				0.24				0.63				0.72
Other expenses (income), net		(0.01	)			(0.01	)			(0.02	)			—
Adjusted diluted earnings per share	$	1.67			$	1.56			$	4.58			$	4.02

FIRSTCASH HOLDINGS, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (CONTINUED) (UNAUDITED)

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA

The Company defines EBITDA as net income before income taxes, depreciation and amortization, interest expense and interest income and adjusted EBITDA as EBITDA adjusted for certain items, as listed below, that management considers to be non-operating in nature and not representative of its actual operating performance. The Company believes EBITDA and adjusted EBITDA are commonly used by investors to assess a company’s financial performance, and adjusted EBITDA is used as a starting point in the calculation of the consolidated total debt ratio as defined in the Company’s senior unsecured notes. The following table provides a reconciliation of net income to EBITDA and adjusted EBITDA (in thousands):

																		Trailing Twelve
		Three Months Ended								Nine Months Ended								Months Ended
		September 30,								September 30,								September 30,
		2024				2023				2024				2023				2024				2023
Net income		$	64,827			$	57,144			$	175,268			$	149,712			$	244,857			$	229,778
Income taxes			20,353				20,480				57,975				51,649				79,874				73,189
Depreciation and amortization			25,933				27,365				78,507				81,526				106,142				107,863
Interest expense			27,424				24,689				78,029				66,657				104,615				86,616
Interest income			(403	)			(328	)			(1,407	)			(1,253	)			(1,623	)			(1,462	)
EBITDA			138,134				129,350				388,372				348,291				533,865				495,984
Adjustments:
Merger and acquisition expenses			225				3,387				2,186				3,670				6,438				5,697
Non-cash foreign currency loss (gain) related to lease liability			1,409				632				3,035				(1,673	)			2,168				(2,652	)
AFF purchase accounting and other adjustments(1)			—				—				—				—				13,968				8,760
Gain on revaluation of contingent acquisition consideration			—				—				—				—				—				(26,760	)
Other expenses (income), net			(490	)			(384	)			(841	)			(260	)			(1,983	)			(270	)
Adjusted EBITDA		$	139,278			$	132,985			$	392,752			$	350,028			$	554,456			$	480,759

FIRSTCASH HOLDINGS, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (CONTINUED) (UNAUDITED)

⁽¹⁾   The following table details AFF purchase accounting and other adjustments for the trailing twelve months ended September 30, 2024 and 2023 (in thousands):

	Trailing Twelve
	Months Ended
	September 30,
	2024			2023
Amortization of fair value adjustment on acquired finance receivables included in interest and fees on finance receivables	$	—		$	7,859
Amortization of fair value adjustment on acquired leased merchandise included in depreciation of leased merchandise		—			901
Other non-recurring costs included in administrative expenses related to a discontinued finance product		13,968			—
	$	13,968		$	8,760

FIRSTCASH HOLDINGS, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (CONTINUED) (UNAUDITED)

Free Cash Flow and Adjusted Free Cash Flow

For purposes of its internal liquidity assessments, the Company considers free cash flow and adjusted free cash flow. The Company defines free cash flow as cash flow from operating activities less purchases of furniture, fixtures, equipment and improvements and net fundings/repayments of pawn loan and finance receivables, which are considered to be operating in nature by the Company but are included in cash flow from investing activities. Adjusted free cash flow is defined as free cash flow adjusted for merger and acquisition expenses paid that management considers to be non-operating in nature.

Free cash flow and adjusted free cash flow are commonly used by investors as additional measures of cash generated by business operations that may be used to repay scheduled debt maturities and debt service or, following payment of such debt obligations and other non-discretionary items, that may be available to invest in future growth through new business development activities or acquisitions, repurchase stock, pay cash dividends or repay debt obligations prior to their maturities. These metrics can also be used to evaluate the Company’s ability to generate cash flow from business operations and the impact that this cash flow has on the Company’s liquidity. However, free cash flow and adjusted free cash flow have limitations as analytical tools and should not be considered in isolation or as a substitute for cash flow from operating activities or other income statement data prepared in accordance with GAAP. The following table reconciles cash flow from operating activities to free cash flow and adjusted free cash flow (in thousands):

																		Trailing Twelve
		Three Months Ended								Nine Months Ended								Months Ended
		September 30,								September 30,								September 30,
		2024				2023				2024				2023				2024				2023
Cash flow from operating activities		$	113,090			$	111,368			$	341,809			$	317,037			$	440,914			$	460,544
Cash flow from certain investing activities:
Pawn loans, net(1)			(48,836	)			(59,614	)			(69,723	)			(59,426	)			(45,275	)			(20,536	)
Finance receivables, net			(48,623	)			(30,869	)			(86,186	)			(87,994	)			(113,634	)			(123,713	)
Purchases of furniture, fixtures, equipment and improvements			(13,368	)			(18,375	)			(56,032	)			(46,723	)			(69,457	)			(52,679	)
Free cash flow			2,263				2,510				129,868				122,894				212,548				263,616
Merger and acquisition expenses paid, net of tax benefit			171				2,605				1,675				2,818				4,946				4,379
Adjusted free cash flow		$	2,434			$	5,115			$	131,543			$	125,712			$	217,494			$	267,995

⁽¹⁾   Includes the funding of new loans net of cash repayments and recovery of principal through the sale of inventories acquired from forfeiture of pawn collateral.

FIRSTCASH HOLDINGS, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES TO GAAP FINANCIAL MEASURES (CONTINUED) (UNAUDITED)

Adjusted Return on Equity and Adjusted Return on Assets

Management believes the presentation of adjusted return on equity and adjusted return on assets provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance by excluding items that management believes are non-operating in nature and not representative of the Company’s core operating performance.

Annualized adjusted return on equity and adjusted return on assets is calculated as follows (dollars in thousands):

	Trailing Twelve
	Months Ended
	September 30, 2024
Adjusted net income(1)	$	300,112
Average stockholders’ equity (average of five most recent quarter-end balances)	$	1,987,405
Adjusted return on equity (trailing twelve months adjusted net income divided by average equity)	15		%
Average total assets (average of five most recent quarter-end balances)	$	4,285,437
Adjusted return on assets (trailing twelve months adjusted net income divided by average total assets)	7		%

⁽¹⁾   See detail of adjustments to net income in the “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section above.

Constant Currency Results

The Company’s reporting currency is the U.S. dollar, however, certain performance metrics discussed in this release are presented on a “constant currency” basis, which is considered a non-GAAP financial measure. The Company’s management uses constant currency results to evaluate operating results of business operations in Latin America, which are transacted in local currencies in Mexico, Guatemala and Colombia. The Company also has operations in El Salvador, where the reporting and functional currency is the U.S. dollar.

The Company believes constant currency results provide valuable supplemental information regarding the underlying performance of its business operations in Latin America, consistent with how the Company’s management evaluates such performance and operating results. Constant currency results reported herein are calculated by translating certain balance sheet and income statement items denominated in local currencies using the exchange rate from the prior-year comparable period, as opposed to the current comparable period, in order to exclude the effects of foreign currency rate fluctuations for purposes of evaluating period-over-period comparisons. See the Latin America pawn segment tables elsewhere in this release for an additional reconciliation of certain constant currency amounts to as reported GAAP amounts.

FIRSTCASH HOLDINGS, INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
TO GAAP FINANCIAL MEASURES (CONTINUED)
(UNAUDITED)
Exchange Rates for the Mexican Peso, Guatemalan Quetzal and Colombian Peso
	September 30,				Favorable /
	2024		2023		(Unfavorable)
Mexican peso / U.S. dollar exchange rate:
End-of-period	19.6		17.6			(11	)%
Three months ended	18.9		17.1			(11	)%
Nine months ended	17.7		17.8			1	%
Guatemalan quetzal / U.S. dollar exchange rate:
End-of-period	7.7		7.9			3	%
Three months ended	7.7		7.9			3	%
Nine months ended	7.8		7.8			—	%
Colombian peso / U.S. dollar exchange rate:
End-of-period	4,164		4,054			(3	)%
Three months ended	4,095		4,048			(1	)%
Nine months ended	3,979		4,413			10	%

FIRSTCASH HOLDINGS, INC. INTERSEGMENT TRANSACTIONS (UNAUDITED)

Intersegment transactions relate to the Company offering AFF’s LTO payment solution in its U.S. pawn stores and are eliminated to arrive at consolidated totals. For the three months ended September 30, 2024 and 2023, these intersegment amounts are as follows:

• U.S. pawn retail merchandise sales includes $1.0 million and $1.5 million, respectively. Excluding these intersegment sales, consolidated U.S. retail merchandise sales totaled $234.1 million and $202.3 million, respectively.
• U.S. pawn cost of retail merchandise sold includes $0.5 million and $0.8 million, respectively. Excluding these intersegment sales, consolidated U.S. cost of retail merchandise sold totaled $134.4 million and $114.9 million, respectively.
• Retail POS payment solutions depreciation of leased merchandise includes $0.4 million and $0.5 million respectively. Excluding these intersegment transactions, consolidated depreciation of leased merchandise totaled $104.9 million and $103.7 million, respectively.
• Retail POS payment solutions provision for lease losses includes an increase of $0.1 million and a provision reduction of $0.1 million, respectively. Excluding these intersegment transactions, consolidated provision for lease losses totaled $39.2 million and $39.7 million, respectively.

For the nine months ended September 30, 2024 and 2023, these intersegment amounts are as follows:

• U.S. pawn retail merchandise sales includes $3.1 million and $4.9 million, respectively. Excluding these intersegment sales, consolidated U.S. retail merchandise sales totaled $699.1 million and $605.6 million, respectively.
• U.S. pawn cost of retail merchandise sold includes $1.7 million and $2.6 million, respectively. Excluding these intersegment sales, consolidated U.S. cost of retail merchandise sold totaled $405.7 million and $346.6 million, respectively.
• Retail POS payment solutions depreciation of leased merchandise includes $1.3 million and $1.6 million, respectively. Excluding these intersegment transactions, consolidated depreciation of leased merchandise totaled $335.4 million and $307.8 million, respectively.
• Retail POS payment solutions provision for lease losses includes $0.4 million and $0.2 million, respectively. Excluding these intersegment transactions, consolidated provision for lease losses totaled $129.8 million and $141.7 million, respectively.

As of September 30, 2024 and 2023, these intersegment amounts are as follows:

• Retail POS payment solutions leased merchandise, net includes $0.2 million and $1.7 million, respectively. Excluding these intersegment transactions, consolidated net leased merchandise totaled $137.8 million and $143.2 million, respectively.

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