First Cash Financial Services (FCFS) Reports In-Line Q2 EPS

First Cash Financial Services (NASDAQ: FCFS) reported Q2 EPS of $0.47, in-line with the analyst estimate of $0.47. Revenue for the quarter came in at $167.6 million versus the consensus estimate of $168.69 million.

Fiscal 2015 Outlook

• Due to the significant further weakening of the Mexican peso during the first and second quarters of 2015, combined with further declines in the price of gold and additional downsizing of the Company's U.S. payday operations, the Company is updating its fiscal full-year 2015 earnings guidance to a range of $2.60 to $2.75 per diluted share. This compares to the previous guidance at the lower end of the range of $2.75 to $2.90 per share.
  • The Company's previous guidance, at the low end of the original fiscal 2015 range, was based on a projected exchange rate of approximately 15.25 Mexican pesos / U.S. dollar for June and the remainder of the year. Based upon the continued volatility and recent further weakening of the exchange rate, we are now assuming an exchange rate in a range of 15.5 to 16.25 Mexican pesos / U.S. dollar for the balance of the year. Accordingly, the incremental foreign currency exchange rate impact for the second half of the year is estimated to be an additional $0.04 to $0.08 per share of earnings headwind.
  • The previous assumption for the price of gold for 2015 was in a range of $1,200 to $1,300 per ounce. Assuming a revised range of $1,100 to $1,200 per ounce based on current market conditions, coupled with a reduction in expected gold transaction volumes, the impact to second half earnings from reduced scrap jewelry profits is in a range of approximately $0.03 to $0.05 per share.
  • The updated fiscal 2015 earnings estimates are further tempered by a greater than expected year-over-year decline in earnings from payday and title lending operations driven in large part by new payday regulations in Texas and the strategic closure of additional locations by the Company. As a result, the Company has reduced its previous second half forecast for consumer lending earnings by $0.02 per share.
  • Earnings for the third quarter of fiscal 2015 that factor in the anticipated headwinds mentioned above are expected to be in the range of $0.60 to $0.66 per diluted share.
• The Company now expects to add approximately 80 to 90 new stores in 2015. A majority of the additions are expected to be de novo large format pawn stores in Mexico.

For earnings history and earnings-related data on First Cash Financial Services (FCFS) click here.

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