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Dec 31, 2023
FirstCash Q4 2023 Earnings Report
Reported strong revenue and earnings growth driven by record pawn receivables and new store growth.
Key Takeaways
FirstCash reported impressive Q4 and full-year 2023 results, driven by record pawn receivables and new store growth. Consolidated revenues increased by 14% to $852 million. Adjusted diluted earnings per share increased by 24%. The company added 157 pawn stores in 2023 and saw growth in its Retail POS Payment Solutions segment, with gross transaction volumes up 14%.
Consolidated revenues totaled $852 million, an increase of 14% on a GAAP basis.
Adjusted diluted earnings per share increased 24% in the fourth quarter.
A total of 157 pawn locations were added in 2023, bringing the store count to 2,997.
AFF reported a 26% increase in the number of active merchant locations as of December 31, 2023, compared to the prior year.
FirstCash
FirstCash
FirstCash Revenue by Segment
FirstCash Revenue by Geographic Location
Revenue by Segment
Retail Merchandise Sales Revenue
CapyFin.comPawn Loan Fees Revenue
CapyFin.comLeased Merchandise Income Revenue
CapyFin.comInterest & Fees on Finance Receivables Revenue
CapyFin.comWholesale Scrap Jewelry Sales Revenue
CapyFin.comRevenue by Geographic Location
U.S. Pawn Revenue
CapyFin.comLatin America Pawn Revenue
CapyFin.com Forward Guidance
The Company’s outlook for 2024 is highly positive, with expected year-over-year growth in revenue and earnings in all segments driven by the continued growth in earning asset balances coupled with recent store additions.
Positive Outlook
- Pawn operations are expected to remain the primary earnings driver in 2024.
- U.S. pawn operations are expected to benefit in 2024 from full year revenue and earnings from the 79 stores acquired in August 2023 and seven stores acquired in late November of 2023.
- Gross transaction volumes originated in 2024 are expected to increase in a range of 10% to 15% for the full year as compared to 2023.
- Resulting revenues are forecast to grow in a range of 7% to 9% in the first quarter and 10% to 12% for the full year as compared to the respective prior-year periods.
- The Company expects AFF's estimated lease and loan loss provisioning rates for 2024 will continue to reflect a consistent provisioning methodology with 100% of estimated lifetime losses being provided for (expensed) upon origination of the lease or loan.
Challenges Ahead
- U.S. pawn receivables growth rates in the second half of 2024 will moderate as the Company laps the significant 2023 pawn acquisition activity.
- Latin America pawn growth is currently up approximately 6% and full year 2024 growth is anticipated to remain in a mid-single digit range assuming foreign exchange rates remain steady.
- Retail sales are also expected to grow in both markets although at a slower rate than pawn loan fee growth given current inventory levels which remain below historical levels as a percentage of pawn receivables.
- Store operating expenses are expected to rise in a range of 7% to 9% for the full year in both the U.S. and Latin America in 2024 due to increased store counts along with continued inflationary impacts (primarily related to further minimum wage increases in Latin America).
- Net interest expense is expected to increase for full year 2024 compared to 2023, with most of the increase expected in the first half of the year due to higher year-over-year interest rates for the comparative periods.
Revenue & Expenses
Visualization of income flow from segment revenue to net income