Rent-A-Center (RCII) Provides Key Operating Metrics for January

Rent-A-Center, Inc. (NASDAQ: RCII) today announced the following key operating metrics for its Core U.S. and Acceptance NOW businesses for January 2017:

The Company will provide the metrics outlined below between the 15th and 20th day of the month for our two main operating segments going forward.

Core U.S.

• Same Store Sales: (11.5%)
• Delinquencies: 9.3% and 30 basis points favorable versus prior month
• Monthly Rate: 4.7% unfavorable versus prior year
• Co-worker Turnover: 76.1% and 4.5 percentage points favorable versus prior year

Acceptance NOW

• Same Store Sales: +2.5%
• Delinquencies: 9.0% and 60 basis points unfavorable versus prior month

"We are encouraged by the early progress on delinquencies and turnover in the Core business in January. As expected, it will take more time to implement improvements that will positively impact same store sales, monthly rate, and Acceptance NOW delinquencies as we execute on our strategic objectives to deliver improved results for all of our stakeholders," stated Mark E. Speese, Interim Chief Executive Officer of Rent-A-Center.

In the Core U.S. business, January same store sales improved sequentially despite remaining under pressure given the lower portfolio value coming out of the fourth quarter 2016. January delinquencies also improved sequentially due to refinements made to our account management process and operational execution. While the January monthly rate remains lower than the prior year, we are confident that our revised value proposition and higher-end product mix will positively impact this number over the course of 2017. Finally, the improvement in store co-worker turnover is primarily the result of adding back full time co-workers.

In Acceptance NOW, January same store sales continued the positive trend from the fourth quarter 2016, driven by stronger rental and fees. Delinquencies continue to be higher than expected and the Company is implementing decision engine and account management enhancements aimed at improving this trend.

Metric Definitions

Core U.S.

• Same Store Sales - year over year revenue performance on comparable stores
• Delinquencies - percent of customer agreements greater than 7 days past due
• Monthly rate - average monthly rental rate for agreements originated in the period
• Co-worker Turnover - annualized year to date store co-worker turnover

AcceptanceNOW

• Same Store Sales - year over year revenue performance on comparable stores
• Delinquencies - percent of customer agreements, in staffed locations, greater than 32 days past due

Same Store Sales Methodology Change

The Company also announced that it is modifying the methodology it uses to calculate same store sales, beginning in 2017. The 2017 metrics set forth reflect the new methodology and will be presented using this methodology going forward. The Company believes these modifications better align its same store sales calculation with the methods used by other rent-to-own companies. Below is a comparison of the current and revised methodologies.

Current Methodology - The Company will exclude from the same store sales base any store that receives a certain level of customer accounts from another store (acquisition or merger). The receiving store will be eligible for inclusion in the same store sales base in the sixth full quarter following the account transfer.

Revised Methodology - The Company will exclude from the same store sales base any store that receives a certain level of customer accounts from another store (acquisition or merger). The receiving store will be eligible for inclusion in the same store sales base in the twenty-fourth full month following the account transfer.

This change in methodology resulted in a favorable impact of approximately 50 basis points to both the Core U.S. and Acceptance NOW segments in the January 2017 same store sales.

You May Also Be Interested In

• Morgan Stanley Starts Sampo Oyj (SAMPO:FH) (SAXPY) at Equalweight
• Tower Semiconductor with METI Support Announces Strategic Capacity Expansion in Japan
• KeyBanc Downgrades Skyworks Solutions (SWKS) to Sector Weight