FIRSTCASH, INC - FORM 8-K - EX-99.4 - EXHIBIT 99.4

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EX-99.5 - EXHIBIT 99.5 - FIRSTCASH, INC	fcfs05152017exhibit995.htm
EX-99.3 - EXHIBIT 99.3 - FIRSTCASH, INC	fcfs05152017exhibit993.htm
EX-99.2 - EXHIBIT 99.2 - FIRSTCASH, INC	fcfs05152017exhibit992.htm
EX-99.1 - EXHIBIT 99.1 - FIRSTCASH, INC	fcfs05152017exhibit991.htm
8-K - FORM 8-K - FIRSTCASH, INC	fcfs051520178-k.htm

EXHIBIT 99.4

Summary Financial and Other Data

The following table sets forth summary financial and other data as of and for each of the periods indicated below. The summary consolidated income statement data and statement of cash flows data for the years ended December 31, 2016, 2015 and 2014 and the selected consolidated balance sheet data as of December 31, 2016 and 2015 have been derived from, and are qualified by reference to, our audited consolidated financial statements incorporated by reference in this offering circular. The summary consolidated income statement data and statement of cash flows data for the years ended December 31, 2013 and 2012 and the selected consolidated balance sheet data as of December 31, 2014, 2013 and 2012 have been derived from our audited consolidated financial statements that are not included or incorporated by reference in this offering circular. The summary consolidated income statement data and statement of cash flows data for the three months ended March 31, 2017 and 2016 and the selected consolidated balance sheet data as of March 31, 2017 and 2016 have been derived from, and are qualified by reference to, our unaudited condensed consolidated financial statements incorporated by reference into this offering circular. We derived the summary pro forma income statement data for the twelve months ended March 31, 2017 by adding the pro forma income statement data for the year ended December 31, 2016 and the summary income statement data for the three months ended March 31, 2017, and subtracting the pro forma income statement data for the three months ended March 31, 2016.

The summary consolidated income statement data and statement of cash flows data for the year ended December 31, 2016 include the results of operations for Cash America for the period September 2, 2016 to December 31, 2016, and the summary consolidated income statement data and statement of cash flows data for the three months ended March 31, 2017 include the results of operations for Cash America for the entire period. The selected consolidated balance sheet data at December 31, 2016 and March 31, 2017 include preliminary valuations of the assets acquired and liabilities assumed in the Merger.

The historical results presented below are not necessarily indicative of the results to be expected for any future period. This information is only a summary and should be read in conjunction with “Risk Factors” included in this offering circular and with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and notes thereto included in this offering circular and incorporated by reference herein from our 2016 Form 10-K and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 (the “2017 First Quarter Form 10-Q”).



															Pro Forma Twelve Months Ended March 31, 2017⁽¹⁾

											Three Months Ended March 31,
	Year Ended December 31,
	2012		2013		2014		2015		2016		2016		2017
	(in thousands, except per share amounts and certain operating data)
Income Statement Data:
Revenue:
Retail merchandise sales	$	287,456	$	367,187	$	428,182	$	449,296	$	669,131	$	118,776	$	259,994	$	1,011,506
Pawn loan fees	152,237		181,555		199,357		195,448		312,757		51,433		128,251		520,323
Consumer loan and credit services fees	48,692		43,781		36,749		27,803		43,851		5,686		21,220		89,224
Wholesale scrap jewelry sales	103,706		68,325		48,589		32,055		62,638		7,308		38,111		135,843
Total revenue	592,091		660,848		712,877		704,602		1,088,377		183,203		447,576		1,756,896

Cost of revenue:
Cost of retail merchandise sold	167,144		221,361		261,673		278,631		418,556		74,422		165,635		645,419
Consumer loan and credit services loss provision	12,556		11,368		9,287		7,159		11,993		1,047		4,092		22,003
Cost of wholesale scrap jewelry sold	76,853		58,545		41,044		27,628		53,025		5,871		34,949		125,177
Total cost of revenue	256,553		291,274		312,004		313,418		483,574		81,340		204,676		792,599

Net revenue	335,538		369,574		400,873		391,184		604,803		101,863		242,900		964,297



															Pro Forma Twelve Months Ended March 31, 2017⁽¹⁾

											Three Months Ended March 31,
	Year Ended December 31,
	2012		2013		2014		2015		2016		2016		2017
Expenses and other income:
Store operating expenses	148,879		181,321		198,986		207,572		328,014		55,411		136,744		545,977
Administrative expenses	48,902		47,180		53,588		51,883		96,537		17,268		33,238		149,873
Depreciation and amortization	12,939		15,361		17,476		17,939		31,865		4,937		14,243		55,006
Interest expense, net	1,272		3,170		12,845		15,321		19,569		4,186		5,786		26,545
Merger and other acquisition expenses	1,309		2,350		998		2,875		36,670		400		647		947
Goodwill impairment – U.S. consumer loan operations	—		—		—		7,913		—		—		—		—
Gain disposition of equity securities	—		—		—		—		(1,299)		—		—		(3,961)
Total expenses and other income	213,301		249,382		283,893		303,503		511,356		82,202		190,658		774,387

Income from continuing operations before income taxes	122,237		120,192		116,980		87,681		93,447		19,661		52,242		189,910

Provision for income taxes	41,375		35,713		31,542		26,971		33,320		6,487		19,597		67,907

Income from continuing operations	80,862		84,479		85,438		60,710		60,127		13,174		32,645		122,003

Loss from discontinued operations, net of tax	(503)		(633)		(272)		—		—		—		—		—

Net income	$	80,359	$	83,846	$	85,166	$	60,710	$	60,127	$	13,174	$	32,645	$	122,003

Dividends declared per common share	$ —		$ —		$ —		$ —		$	0.565	$	0.125	$	0.190	$	0.63

Balance Sheet Data:
Inventories	$	63,345	$	77,793	$	91,088	$	93,458	$	330,683	$	90,714	$	308,165	$	308,165
Pawn loans	103,181		115,234		118,536		117,601		350,506		126,620		314,505		314,505
Net working capital	209,132		236,417		258,194		279,259		748,507		240,521		671,048		671,048
Total assets	506,544		660,999		711,880		752,895		2,145,203		753,885		2,043,554		2,043,554
Long-term liabilities	122,978		201,889		234,880		275,338		551,589		258,669		438,569		438,569
Total liabilities	154,128		250,650		277,439		321,513		695,217		314,598		556,319		556,319
Stockholders’ equity	352,416		410,349		434,441		431,382		1,449,986		439,287		1,487,235		1,487,235



															Pro Forma Twelve Months Ended March 31, 2017⁽¹⁾

											Three Months Ended March 31,
	Year Ended December 31,
	2012		2013		2014		2015		2016		2016		2017
Statement of Cash Flows Data:
Net cash flows provided by (used in):
Operating activities	$	88,792	$	106,718	$	97,679	$	92,749	$	96,854	$	25,076	$	63,865
Investing activities	(159,904)		(140,726)		(85,366)		(71,676)		(25,967)		(27,095)		58,259
Financing activities	49,525		54,644		(9,098)		9,127		(58,713)		(28,062)		(142,177)

Other Financial Data⁽²⁾:
Adjusted EBITDA					148,027		132,201		180,252		29,184		72,918		268,447
Adjusted net income					80,004		68,483		85,332		13,434		33,053		120,126
Free cash flow (twelve months ended)					71,255		67,960		46,919		60,630		145,871
Ratio of total debt (as adjusted)⁽³⁾to Adjusted EBITDA															1.6
Ratio of Adjusted EBITDA to interest expense (as adjusted)⁽³⁾															9.3

Location Counts:
Pawn stores	715		821		912		1,005		2,012		1,204		2,017		2,017
Credit services/consumer loan stores	99		85		93		70		73		69		73		73
	814		906		1,005		1,075		2,085		1,273		2,090		2,090


(1)	See “Unaudited Pro Forma Combined Financial Information.”


(2)	These measures are non-GAAP financial measures.


(3)	Total debt and interest expense is calculated on a pro forma basis, as adjusted to give effect to the offering of the notes.

The Company uses certain financial calculations such as EBITDA, adjusted EBITDA, adjusted net income and free cash flow (as defined or explained below) 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 GAAP, primarily by excluding from a comparable GAAP measure certain items that the Company does not consider to be representative of its actual operating performance. These financial calculations are “non-GAAP financial measures” as defined in 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 operating performance and because management believes they 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 EBITDA, adjusted EBITDA, adjusted net income and free cash flow 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, EBITDA, adjusted EBITDA, adjusted net income and free cash flow as presented may not be comparable to other similarly titled measures of other companies.

The Company expects to incur additional expenses over the next two years in connection with the Merger and integration with Cash America. The Company has adjusted the applicable financial measures to exclude these items because it generally would not incur such costs and expenses as part of its continuing operations. The Merger-related expenses are predominantly incremental costs directly associated with the Merger and integration of Cash America, including professional fees, legal expenses, severance and retention payments, accelerated vesting of certain equity compensation awards, contract breakage costs and costs related to consolidation of technology systems and corporate facilities.

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 further adjusted to exclude certain items as listed below that management considers to be non-operating in nature and not representative of the Company’s actual operating performance. The Company believes EBITDA and adjusted EBITDA are commonly used by investors to assess a company’s financial performance. However, EBITDA and adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as a substitute for net income or other statement of income data prepared in accordance with GAAP. The following table provides a reconciliation of net income to EBITDA and adjusted EBITDA (unaudited, in thousands):



	Year Ended December 31,						Three Months Ended March 31,				Pro Forma Twelve Months Ended March 31, 2017



	2014		2015		2016		2016		2017
Net income	$	85,166	$	60,710	$	60,127	$	13,174	$	32,645	$	122,003
Income taxes	31,542		26,971		33,320		6,487		19,597		67,907
Depreciation and amortization(a)	17,476		17,446		31,865		4,937		14,243		55,006
Interest expense	13,527		16,887		20,320		4,460		6,113		27,383
Interest income	(682)		(1,566)		(751)		(274)		(327)		(838)
EBITDA	147,029		120,448		144,881		28,784		72,271		271,461
Adjustments:
Merger-related expenses	—		—		36220		250		647		647
Other acquisition expenses	998		2,875		450		150		—		300
Restructuring expenses related to U.S. consumer loan operations	—		8,878		—		—		—		—
Net gain on sale of common stock of Enova International, Inc.	—		—		(1,299)		—		—		(3,961)
Adjusted EBITDA	$	148,027	$	132,201	$	180,252	$	29,184	$	72,918	$	268,447


(a)	For fiscal 2015, excludes $493 of depreciation and amortization, which is included in the restructuring expenses related to U.S. consumer loan operations.

Adjusted Net Income

Management believes the presentation of adjusted net income provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance and prospects for the future. 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 table provides a reconciliation between net income calculated in accordance with GAAP to adjusted net income, which are shown net of tax (unaudited, in thousands):



	Year Ended December 31,						Three Months Ended March 31,				Pro Forma Twelve Months Ended March 31,
	2014		2015		2016		2016		2017		2017
Net income, as reported	$	85,166	$	60,710	$	60,127	$	13,174	$	32,645	$	122,003
Adjustments, net of tax:
Merger-related expenses
Transaction	—		—		14,399		166		—		—
Severance and retention	—		—		9,594		—		354		354
Other	—		—		1,726		—		54		54
Total Merger-related expenses	—		—		25,719		166		408		408
Other acquisition expenses	679		1,989		304		94		—		210
Restructuring expenses related to U.S. consumer loan operations	—		5,784		—		—		—		—
Foreign tax benefit	(5,841)		—		—		—		—		—
Net gain on sale of common stock of Enova	—		—		(818)		—		—		(2,495)
Adjusted net income	$	80,004	$	68,483	$	85,332	$	13,434	$	33,053	$	120,126

The following tables provide a reconciliation of the gross amounts, the impact of income taxes and the net amounts for each of the adjustments included in the table above (unaudited, in thousands):



	Year Ended December 31,
	2014							2015						2016						Pro Forma Twelve Months Ended March 31, 2017
	Pre-tax		Tax		After-tax			Pre-tax		Tax		After-tax		Pre-tax		Tax		After-tax		Pre-tax			Tax			After-tax
Merger-related expenses(a)	$ —		$ —		$ —			$ —		$ —		$ —		$	36,220	$	10,501	$	25,719	$	647		$	239		$	408
Other acquisition expenses	998		319		679			2,875		886		1,989		450		146		304		300			90			210
Restructuring expenses related to U.S. consumer loan operations	—		—		—			8,878		3,094		5,784		—		—		—		—			—			—
Foreign tax benefit	—		5,841		(5,841)			—		—		—		—		—		—		—			—			—
Net gain on sale of common stock of Enova	—		—		—			—		—		—		(1,299)		(481)		(818)		(3,961)			(1,466)			(2,495)
Total adjustments	$	998	$	6,160	$	(5,162	)	$	11,753	$	3,980	$	7,773	$	35,371	$	10,166	$	25,205	$	(3,014	)	$	(1,137	)	$	(1,877	)


^(a)	Resulting tax benefit for the year ended December 31, 2016 is less than the statutory rate as a portion of the transaction costs are not deductible for tax purposes. See Note 4 to the consolidated financial statements in “Financial Statements and Supplementary Date” in the 2016 Form 10-K for further information.



	Three Months Ended March 31,
	2016						2017
	Pre-tax		Tax		After-tax		Pre-tax		Tax		After-tax
Merger-related expenses	$	250	$	84	$	166	$	647	$	239	$	408
Other acquisition expenses	150		56		94		—		—		—
Total adjustments	$	400	$	140	$	260	$	647	$	239	$	408

Free Cash Flow

For purposes of its internal liquidity assessments, the Company considers free cash flow, which the Company defines as cash flow from operating activities reduced by purchases of property and equipment and net cash outflow from loan receivables. Free cash flow is commonly used by investors as an additional measure 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, 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 has limitations as an analytical tool and should not be considered in isolation or as a substitute for cash flow from operating activities, including discontinued operations, or other income statement data prepared in accordance with GAAP. The following table reconciles “net cash flow from operating activities” to “free cash flow” (in thousands):



	Year Ended December 31,						Twelve Months Ended March 31,
	2014		2015		2016		2016		2017
Cash flow from operating activities	$	97,679	$	92,749	$	96,854	$	90,395	$	135,643
Cash flow from investing activities:
Loan receivables, net of cash repayments	(2,470)		(3,716)		(16,072)		(6,735)		45,824
Purchases of property and equipment	(23,954)		(21,073)		(33,863)		(23,030)		(35,596)
Free cash flow	$	71,255	$	67,960	$	46,919	$	60,630	$	145,871

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