PLANO, Texas, Feb 06, 2006 (BUSINESS WIRE) -- Rent-A-Center, Inc. (the "Company") (Nasdaq:RCII), the
nation's largest rent-to-own operator, today announced revenues and
net earnings for the quarter and year ended December 31, 2005.
Fourth Quarter 2005 Results
The Company reported total revenues for the quarter ended December
31, 2005 of $583.2 million, a $2.1 million decrease from $585.3
million for the same period in the prior year. This decrease of 0.4%
in revenues was primarily driven by a decrease in same store sales of
0.2% plus the closing and merging of 114 stores with existing
Rent-A-Center stores and the sale of 35 stores as part of the
previously announced 162 store consolidation plan, offset by an
increase in incremental revenues generated in new and acquired stores.
Net earnings for the quarter ended December 31, 2005 were $33.6
million, or $0.48 per diluted share, when excluding the expenses for
restructuring and the impact of the hurricanes as well as the credit
for the state tax reserve adjustment discussed below, representing a
decrease of 12.7% from the $0.55 per diluted share, or net earnings of
$41.7 million for the same period in the prior year, when excluding
the one-time other income item discussed below. The decrease in net
earnings per diluted share is primarily attributable to the decrease
in same store sales as well as increases in operating expenses related
to new store openings, acquisitions and normal operating costs such as
utility and fuel costs, offset by a reduction in the number of the
Company's outstanding shares.
Reported net earnings for the quarter ended December 31, 2005 were
$35.1 million, or $0.50 per diluted share, when including the $0.02
effect of restructuring expenses, the $0.01 impact of the hurricane
expenses and the $0.05 benefit from the credit for the state tax
reserve adjustment, representing a decrease of 18.0% from the $0.61
per diluted share, or reported net earnings of $46.9 million for the
same period in the prior year, when including the one-time other
income item discussed below.
"We are pleased with the results for the fourth quarter, where we
saw improvement in our same store sales trend and exceeded the high
end of our expectations for diluted earnings per share," commented
Mark E. Speese, the Company's Chairman and Chief Executive Officer.
"In addition, we continue to generate significant cash flow from
operations that we intend to utilize to enhance stockholder value by,
among other things, adding approximately 5% annually to our
rent-to-own store base, opening financial services centers in existing
rent-to-own stores and repurchasing our outstanding common shares,"
Speese added.
Year End December 31, 2005 Results
Total reported revenues for the twelve months ended December 31,
2005 increased to $2.339 billion, a 1.1% increase from $2.313 billion
for the same period in the prior year. Same store revenues for the
twelve month period ending December 31, 2005 decreased 2.3%, compared
to a decrease of 3.6% for the twelve month period ending December 31,
2004.
Net earnings for the twelve months ended December 31, 2005 were
$141.9 million, or $1.91 per diluted share, when excluding the
expenses for restructuring and the impact of the hurricanes as well as
the credits for the state tax reserve adjustment, federal tax audit
reserve, and litigation reversion discussed below, representing a
decrease of 16.2% from the $2.28 per diluted share, or net earnings of
$182.7 million for the same period in the prior year, when excluding
the one-time other income item and litigation and finance charges
discussed below.
Reported net earnings for the twelve months ended December 31,
2005 were $135.7 million, or $1.83 per diluted share, when including
the $0.14 effect of restructuring expenses and the $0.09 impact of the
hurricane expenses as well as $0.05 for the state tax reserve
adjustment credit, $0.03 for the federal tax audit reserve credit, and
$0.07 for the litigation reversion credit, representing a decrease of
5.7% from the $1.94 per diluted share, or reported net earnings of
$155.9 million for the same period in the prior year, when including
the one-time other income item and litigation and finance charges
discussed below.
"Our 2005 earnings were negatively affected by the weakness in our
same store sales, which we believe reflects, among other things,
higher fuel and energy costs that ultimately suppressed customer
demand, and also believe that product evolution, particularly in low
end consumer electronics, placed additional pressure on our business,"
stated Mr. Speese. Mr. Speese added, "I am cautiously optimistic about
2006. Though the potential impact of continued rising fuel and energy
costs remains a concern, we also believe we have reached a trough in
the impact on our operations from the evolution of low end consumer
electronics," Speese continued. "We will continue to focus on
improving our store operations, including using our resources
prudently and focusing on driving more customer traffic from our
advertising initiatives."
Through the twelve month period ended December 31, 2005, the
Company generated cash flow from operations of approximately $187.9
million, while ending the quarter with $57.6 million of cash on hand.
On August 22, 2005, the Company announced that its Board of Directors
increased the authorization for stock repurchases under the Company's
common stock repurchase program to $400 million. During the twelve
month period ended December 31, 2005, the Company repurchased
5,900,700 shares for $118.4 million in cash under the program and has
utilized a total of $356.1 million of the total amount authorized by
its Board of Directors since the inception of the plan.
Operations Highlights
During the fourth quarter of 2005, the Company opened 28 new
rent-to-own store locations, acquired five stores as well as accounts
from four additional locations, consolidated 18 stores into existing
locations, sold 37 stores and closed five stores, for a net reduction
of 27 stores. During the fourth quarter of 2005, the Company added
financial services to 13 existing rent-to-own store locations,
consolidated one store with financial services into an existing
location and ended the year with a total of 40 stores providing these
services.
Through the twelve month period ending December 31, 2005, the
Company opened 67 new rent-to-own store locations, acquired 44 stores
as well as accounts from 39 additional locations, consolidated 170
stores into existing locations, sold 43 stores and closed 13 stores,
for a net reduction of 115 stores. Since January 1, 2006, the Company
has opened four new rent-to-own store locations, acquired two stores
as well as accounts from three additional locations, consolidated five
stores into existing locations and sold one store. The Company has
added financial services to three existing rent-to-own store locations
since January 1, 2006.
2005 Store Consolidation Plan Expenses
During the fourth quarter of 2005, the Company recorded a pre-tax
restructuring expense of approximately $2.1 million as part of the
store consolidation plan announced on September 6, 2005. The costs
with respect to these store closings relate primarily to lease
terminations of approximately $2.8 million, fixed asset disposals of
approximately $1.5 million and the proceeds from the sale of stores
net of inventory costs of $2.3 million. This restructuring expense
reduced diluted earnings per share in the fourth quarter of 2005 by
$0.02.
For the third and fourth quarter of 2005 combined, the Company
recorded pre-tax restructuring expenses of approximately $15.2 million
as part of the store consolidation plan. The costs with respect to
these store closings relate primarily to lease terminations of
approximately $9.3 million, goodwill impairment of approximately $4.5
million, fixed asset disposals of approximately $3.3 million and the
proceeds from the sale of stores net of inventory costs of $2.3
million. This restructuring expense reduced diluted earnings per share
for the twelve month period ended December 31, 2005 by $0.14.
2005 Hurricane Related Expenses
During the fourth quarter of 2005, the Company recorded a pre-tax
expense of approximately $1.1 million related to the damage caused by
Hurricanes Katrina, Rita and Wilma. These costs relate primarily to
inventory losses. This expense reduced diluted earnings per share in
the fourth quarter of 2005 by $0.01.
For the third and fourth quarter of 2005 combined, the Company
recorded pre-tax expenses of approximately $8.9 million related to the
damage caused by Hurricanes Katrina, Rita and Wilma. These costs
relate primarily to inventory losses of approximately $4.5 million and
goodwill impairment of approximately $3.7 million. These expenses
reduced diluted earnings per share for the twelve month period ended
December 31, 2005 by $0.09.
2005 Tax Reserve Adjustment and Litigation Reversion Credits
During the fourth quarter of 2005, the Company recorded a $3.7
million state tax reserve credit for a reserve adjustment due to a
change in estimate related to potential loss exposures. Also in 2005,
the Company recorded a $2.0 million tax audit reserve credit in the
second quarter associated with the examination and favorable
resolution of the Company's 1998 and 1999 federal tax returns. In
addition, the Company recorded an $8.0 million pre-tax credit in the
first quarter associated with the settlement of the Griego/Carrillo
litigation. The state tax reserve credit in the fourth quarter, the
federal tax audit reserve credit in the second quarter and the
litigation reversion credit in the first quarter increased diluted
earnings per share for the twelve month period ended December 31, 2005
by $0.05, $0.03, and $0.07, respectively.
2004 Non-Recurring Items
During the fourth quarter of 2004, the Company recorded $7.9
million in one-time other income associated with the sale of
charged-off accounts. This other income increased diluted earnings per
share in the fourth quarter of 2004 by $0.06, from $0.55 per diluted
earnings per share to the reported diluted earnings per share of
$0.61. Additionally, this other income increased diluted earnings per
share for the twelve month period ended December 31, 2004 by $0.06.
In addition, during 2004, the Company recorded $47.0 million in
pre-tax charges in the third quarter associated with the settlement of
the Griego/Carrillo litigation and $4.2 million in pre-tax charges
associated with the refinancing of its senior credit facility. These
charges reduced diluted earnings per share for the twelve month period
ended December 31, 2004 by $0.40. These charges, combined with the
$7.9 million in one-time other income in the fourth quarter, reduced
diluted earnings per share for the twelve month period ended December
31, 2004 by $0.34 to the reported diluted earnings per share of $1.94.
Rent-A-Center will host a conference call to discuss the fourth
quarter and year end financial results on Tuesday morning, February 7,
2006, at 10:45 a.m. EST. For a live webcast of the call, visit
http://investor.rentacenter.com. Certain financial and other
statistical information that will be discussed during the conference
call will also be provided on the same website.
Rent-A-Center, Inc., headquartered in Plano, Texas, currently
operates 2,760 company-owned stores nationwide and in Canada and
Puerto Rico. The stores generally offer high-quality, durable goods
such as major consumer electronics, appliances, computers and
furniture and accessories under flexible rental purchase agreements
that generally allow the customer to obtain ownership of the
merchandise at the conclusion of an agreed upon rental period.
ColorTyme, Inc., a wholly owned subsidiary of the Company, is a
national franchiser of 294 rent-to-own stores, 285 of which operate
under the trade name of "ColorTyme," and the remaining nine of which
operate under the "Rent-A-Center" name.
The following statements are based on current expectations. These
statements are forward-looking, and actual results may differ
materially. These statements do not include the potential impact of
any repurchases of common stock the Company may make, expenses to be
incurred in connection with the store consolidation plan, or the
potential impact of acquisitions that may be completed after February
6, 2006.
FIRST QUARTER 2006 GUIDANCE:
Revenues
- The Company expects total revenues to be in the range of $591
million to $599 million.
- Store rental and fee revenues are expected to be between $509
million and $515 million.
- Total store revenues are expected to be in the range of $579
million to $587 million.
- Same store sales are expected to be flat to slightly positive.
- The Company expects to open 5-15 new rent-to-own store
locations.
- The Company expects to add financial services to 10-15
rent-to-own store locations.
Expenses
- The Company expects cost of rental and fees to be between
21.6% and 22.0% of store rental and fee revenue and cost of
goods merchandise sales to be between 65% and 70% of store
merchandise sales.
- Store salaries and other expenses are expected to be in the
range of 57.3% to 58.8% of total store revenue.
- General and administrative expenses are expected to be between
3.5% and 3.7% of total revenue.
- Net interest expense is expected to be approximately $12.0
million, depreciation of property assets to be approximately
$13.0 million and amortization of intangibles is expected to
be approximately $1.0 million.
- The effective tax rate is expected to be approximately 37.0%
of pre-tax income.
- Diluted earnings per share are estimated to be in the range of
$0.48 to $0.52, including stock option expense.
- Diluted shares outstanding are estimated to be between 69.7
million and 70.7 million.
FISCAL 2006 GUIDANCE:
Revenues
- The Company expects total revenues to be in the range of $2.33
billion and $2.36 billion.
- Store rental and fee revenues are expected to be between
$2.080 billion and $2.105 billion.
- Total store revenues are expected to be in the range of $2.294
billion and $2.324 billion.
- Same store sales are expected to be flat to slightly positive.
- The Company expects to open 60-80 new store locations.
- The Company expects to add financial services to 100-160
rent-to-own store locations.
Expenses
- The Company expects cost of rental and fees to be between
21.5% and 21.9% of store rental and fee revenue and cost of
goods merchandise sales to be between 70% and 75% of store
merchandise sales.
- Store salaries and other expenses are expected to be in the
range of 58.0% to 59.5% of total store revenue.
- General and administrative expenses are expected to be between
3.6% and 3.8% of total revenue.
- Net interest expense is expected to be between $42.0 million
and $47.0 million, depreciation of property assets is expected
to be between $52.0 million and $57.0 million and amortization
of intangibles is expected to be approximately $3.5 million.
- The effective tax rate is expected to be approximately 37.0%
of pre-tax income.
- Diluted earnings per share are estimated to be in the range of
$2.00 to $2.10, including stock option expense.
- Diluted shares outstanding are estimated to be between 70.0
million and 71.5 million.
This press release and the guidance above contain forward-looking
statements that involve risks and uncertainties. Such forward-looking
statements generally can be identified by the use of forward-looking
terminology such as "may," "will," "expect," "intend," "could,"
"estimate," "should," "anticipate," or "believe," or the negative
thereof or variations thereon or similar terminology. Although the
Company believes that the expectations reflected in such
forward-looking statements will prove to be correct, the Company can
give no assurance that such expectations will prove to have been
correct. The actual future performance of the Company could differ
materially from such statements. Factors that could cause or
contribute to such differences include, but are not limited to:
uncertainties regarding additional costs and expenses that could be
incurred in connection with the store consolidation plan,
uncertainties regarding the ability to open new rent-to-own stores;
the Company's ability to acquire additional rent-to-own stores on
favorable terms; the Company's ability to enhance the performance of
these acquired stores; the Company's ability to control store level
costs; the Company's ability to identify and successfully market
products and services that appeal to our customer demographic; the
Company's ability to identify and successfully enter new lines of
business offering products and services that appeal to our customer
demographic; the results of the Company's litigation; the passage of
legislation adversely affecting the rent-to-own or financial services
industry; interest rates; the Company's ability to collect on its
rental purchase agreements; the Company's ability to enter into new
rental purchase agreements; economic pressures affecting the
disposable income available to our targeted consumers, such as high
fuel and utility costs; changes in the Company's effective tax rate;
changes in the Company's stock price and the number of shares of
common stock that the Company may or may not repurchase; and the other
risks detailed from time to time in the Company's SEC filings,
including but not limited to, its annual report on Form 10-K for the
year ended December 31, 2004 and its quarterly reports on Form 10-Q
for the three month period ended March 31, 2005, the Form 10-Q for the
six month period ended June 30, 2005 and the Form 10-Q for the nine
month period ended September 30, 2005. You are cautioned not to place
undue reliance on these forward-looking statements, which speak only
as of the date of this press release. Except as required by law, the
Company is not obligated to publicly release any revisions to these
forward-looking statements to reflect the events or circumstances
after the date of this press release or to reflect the occurrence of
unanticipated events.
Rent-A-Center, Inc. and Subsidiaries
STATEMENT OF EARNINGS HIGHLIGHTS
(In Thousands of Dollars, except per share data)
Three Months Ended December 31,
-----------------------------------
2005 2005
----------------- -----------------
Excluding Including
Restructuring Restructuring
and Hurricane and Hurricane
Expenses and Expenses and
State Tax State Tax
Reserve Credit Reserve Credit
----------------- -----------------
Total Revenue $583,213 $583,213
Operating Profit 63,073 59,811
Net Earnings 33,596 35,050 (1)
Diluted Earnings per Common
Share $0.48 $0.50 (1)
Adjusted EBITDA $77,764 $77,764
Reconciliation to Adjusted
EBITDA:
Earnings before income taxes 51,742 48,480
Add back:
Restructuring expense -- 2,138
Hurricane expense impact -- 1,124
Other income - sale of
charged-off accounts -- --
Interest expense, net 11,331 11,331
Depreciation of property
assets 13,364 13,364
Amortization of
intangibles 1,327 1,327
----------------- -----------------
Adjusted EBITDA $77,764 $77,764
Three Months Ended December 31,
------------------------------------
2004 2004
----------------- -----------------
Excluding Sale Including Sale of
of Charged-Off Charged-Off
Accounts Accounts
----------------- -----------------
Total Revenue $585,283 $585,283
Operating Profit 75,725 75,725
Net Earnings 41,714 46,879 (2)
Diluted Earnings per Common
Share $0.55 $0.61 (2)
Adjusted EBITDA $91,078 $91,078
Reconciliation to Adjusted
EBITDA:
Earnings before income taxes 66,545 74,469
Add back:
Restructuring expense -- --
Hurricane expense impact -- --
Other income - sale of
charged-off accounts -- (7,924)
Interest expense, net 9,180 9,180
Depreciation of property
assets 12,975 12,975
Amortization of
intangibles 2,378 2,378
----------------- -----------------
Adjusted EBITDA $91,078 $91,078
Twelve Months Ended December 31,
-----------------------------------
2005 2005
----------------- -----------------
Excluding Including
Restructuring Restructuring
and Hurricane and Hurricane
Expenses & Tax Expenses & Tax
Audit Reserve, Audit Reserve,
State Tax State Tax
Reserve and Reserve and
Litigation Litigation
Credits Credits
----------------- -----------------
Total Revenue $2,339,107 $2,339,107
Operating Profit 265,803 249,771
Net Earnings 141,886 135,738 (3,4)
Diluted Earnings per Common
Share $1.91 $1.83 (3,4)
Adjusted EBITDA $327,223 $327,223
Reconciliation to Adjusted
EBITDA:
Earnings before income taxes 225,100 209,068
Add back:
Restructuring expense -- 15,166
Hurricane expense impact -- 5,199
Litigation (reversion)
settlement -- (8,000)
Finance charge from
recapitalization -- --
Other income - sale of
charged-off accounts -- --
Interest expense, net 40,703 40,703
Depreciation of property
assets 53,382 53,382
Amortization of
intangibles 8,038 11,705 (6)
----------------- -----------------
Adjusted EBITDA $327,223 $327,223
Twelve Months Ended December 31,
------------------------------------
2004 2004
----------------- -----------------
Excluding Sale Including Sale
of Charged-Off of Charged-Off
Accounts, Accounts,
Litigation & Litigation &
Finance Charges Finance Charges
----------------- -----------------
Total Revenue $2,313,255 $2,313,255
Operating Profit 329,951 282,951
Net Earnings 182,669 155,855 (5)
Diluted Earnings per Common
Share $2.28 $1.94 (5)
Adjusted EBITDA $389,297 $389,297
Reconciliation to Adjusted
EBITDA:
Earnings before income taxes 294,628 251,379
Add back:
Restructuring expense -- --
Hurricane expense impact -- --
Litigation (reversion)
settlement -- 47,000
Finance charge from
recapitalization -- 4,173
Other income - sale of
charged-off accounts -- (7,924)
Interest expense, net 35,323 35,323
Depreciation of property
assets 48,566 48,566
Amortization of
intangibles 10,780 10,780
----------------- -----------------
Adjusted EBITDA $389,297 $389,297
(1) Including the effects of a $2.1 million pre-tax restructuring
expense as part of the store consolidation plan announced
September 6, 2005, $1.1 million in pre-tax expenses related to
the damage caused by Hurricanes Katrina, Rita and Wilma, and a
$3.7 million state tax reserve credit for a reserve
adjustment. The expenses reduced diluted earnings per share in
the fourth quarter of 2005 by $0.02 for the restructuring
expense, and by $0.01 for the hurricane expenses, while the
state tax reserve credit increased diluted earnings per share
by $0.05.
(2) Including the effects of $7.9 million in one-time other income
associated with the sale of charged-off accounts. This other
income increased diluted earnings per share in the fourth
quarter of 2004 and for the twelve month period ended December
31, 2004 by $0.06.
(3) Including the effects of a $15.2 million pre-tax restructuring
expense as part of the store consolidation plan announced
September 6, 2005, $8.9 million in pre-tax expenses related to
the damage caused by Hurricanes Katrina, Rita and Wilma, and a
$3.7 million state tax reserve credit for a reserve
adjustment. The expenses reduced diluted earnings per share
for the twelve month period ending December 31, 2005 by $0.14
for the restructuring expense, and by $0.09 for the hurricane
expenses, while the state tax reserve credit increased diluted
earnings per share by $0.05.
(4) Including the effects of an $8.0 million pre-tax credit in the
first quarter associated with the settlement of the
Griego/Carrillo litigation reversion, and a $2.0 million tax
audit reserve credit associated with the examination and
favorable resolution of the Company's 1998 and 1999 federal
tax returns in the second quarter of 2005. These credits
increased diluted earnings per share for the twelve month
period ended December 31, 2005 by $0.10.
(5) Including the effects of $47.0 million in pre-tax charges
associated with the Griego/Carrillo litigation and $4.2
million in pre-tax charges associated with refinancing of the
Company's senior credit facility, both in the third quarter.
These charges reduced diluted earnings per share for the
twelve month period ended December 31, 2004 by $0.40. These
charges, combined with the $7.9 million in one-time other
income in the fourth quarter, reduced diluted earnings per
share for the twelve month period ended December 31, 2004 by
$0.34 to the reported diluted earnings per share of $1.94.
(6) Includes $3.667 million of goodwill impairment related to
Hurricanes Katrina, Rita and Wilma in the third quarter.
Selected Balance Sheet Data:
(in Thousands of Dollars) December 31, 2005 December 31, 2004
----------------- -----------------
Cash and cash equivalents $ 57,627 $ 58,825
Prepaid expenses and other
assets 38,523 65,050
Rental merchandise, net
On rent 588,978 596,447
Held for rent 161,702 162,664
Total Assets 1,948,664 1,967,788
Senior debt 424,050 408,250
Subordinated notes payable 300,000 300,000
Total Liabilities 1,125,232 1,173,517
Stockholders' Equity 823,431 794,271
CONSOLIDATED STATEMENTS OF EARNINGS
(In Thousands of Dollars, except per
share data) Three Months Ended December 31,
-------------------------------
2005 2004
--------------- -------------
Unaudited
Store Revenue
Rentals and Fees $523,063 $530,407
Merchandise Sales 37,812 36,307
Installment Sales 6,565 6,336
Other 2,890 602
--------------- -------------
570,330 573,652
Franchise Revenue
Franchise Merchandise Sales 11,762 10,299
Royalty Income and Fees 1,121 1,332
--------------- -------------
Total Revenue 583,213 585,283
Operating Expenses
Direct Store Expenses
Cost of Rentals and Fees 113,873 116,167
Cost of Merchandise Sold 29,018 28,017
Cost of Installment Sales 2,720 2,710
Salaries and Other Expenses 341,391 331,374
Franchise Operation Expenses
Cost of Franchise Merchandise
Sales 11,326 9,781
--------------- -------------
498,328 488,049
General and Administrative Expenses 21,609 19,131
Amortization of Intangibles 1,327 2,378
Restructuring charge 2,138 --
Class Action Litigation (Reversion)
Settlement -- --
--------------- -------------
Total Operating Expenses 523,402 509,558
--------------- -------------
Operating Profit 59,811 75,725
Other Income - Sale of Charged-Off
Accounts -- (7,924)
Interest Income (1,408) (1,255)
Interest Expense 12,739 10,435
--------------- -------------
Earnings before Income Taxes 48,480 74,469
Income Tax Expense 13,430 27,590
--------------- -------------
NET EARNINGS 35,050 46,879
Preferred Dividends -- --
--------------- -------------
Net earnings allocable to common
stockholders $35,050 $46,879
=============== =============
BASIC WEIGHTED AVERAGE SHARES 69,942 74,863
=============== =============
BASIC EARNINGS PER COMMON SHARE $0.50 $0.63
=============== =============
DILUTED WEIGHTED AVERAGE SHARES 70,647 76,427
=============== =============
DILUTED EARNINGS PER COMMON SHARE $0.50 $0.61
=============== =============
Rent-A-Center, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF EARNINGS
(In Thousands of Dollars, except per
share data) Twelve Months Ended December 31,
--------------------------------
2005 2004
---------------- ---------------
Unaudited
Store Revenue
Rentals and Fees $2,084,757 $2,071,866
Merchandise Sales 177,292 166,594
Installment Sales 26,139 24,304
Other 7,903 3,568
---------------- ---------------
2,296,091 2,266,332
Franchise Revenue
Franchise Merchandise Sales 37,794 41,398
Royalty Income and Fees 5,222 5,525
---------------- ---------------
Total Revenue 2,339,107 2,313,255
Operating Expenses
Direct Store Expenses
Cost of Rentals and Fees 452,583 450,035
Cost of Merchandise Sold 129,624 119,098
Cost of Installment Sales 10,889 10,512
Salaries and Other Expenses 1,358,760 1,277,926
Franchise Operation Expenses
Cost of Franchise Merchandise
Sales 36,319 39,472
---------------- ---------------
1,988,175 1,897,043
General and Administrative Expenses 82,290 75,481
Amortization of Intangibles 11,705 10,780
Restructuring charge 15,166 --
Class Action Litigation (Reversion)
Settlement (8,000) 47,000
---------------- ---------------
Total Operating Expenses 2,089,336 2,030,304
---------------- ---------------
Operating Profit 249,771 282,951
Finance Charge from Recapitalization -- 4,173
Other Income - Sale of Charged-Off
Accounts -- (7,924)
Interest Income (5,492) (5,637)
Interest Expense 46,195 40,960
---------------- ---------------
Earnings before Income Taxes 209,068 251,379
Income Tax Expense 73,330 95,524
---------------- ---------------
NET EARNINGS 135,738 155,855
Preferred Dividends -- --
---------------- ---------------
Net earnings allocable to common
stockholders $135,738 $155,855
================ ===============
BASIC WEIGHTED AVERAGE SHARES 73,018 78,150
================ ===============
BASIC EARNINGS PER COMMON SHARE $1.86 $1.99
================ ===============
DILUTED WEIGHTED AVERAGE SHARES 74,108 80,247
================ ===============
DILUTED EARNINGS PER COMMON SHARE $1.83 $1.94
================ ===============
SOURCE: Rent-A-Center, Inc.
Rent-A-Center, Inc., Plano
David E. Carpenter, 972-801-1214
dcarpenter@racenter.com
