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Item 1. Financial Statements

2021-05-05 compared with 2021-02-03 · 152 added, 86 removed, 473 unchanged (33% of the section changed)

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts) December 31,

(in thousands, except share and per share amounts) March 31,

September 30,

34 unchanged sentences

issued and outstanding:

52,628,588 as of December 31, 2020;

52,886,122 as of December 31, 2019;

52,873,568 as of March 31, 2021;

52,097,590 as of March 31, 2020;

and 52,332,848 as of September 30, 2020

10 unchanged sentences

Three Months Ended

Six Months Ended

(in thousands, except per share amount) 2021 2020 2021 2020

11 unchanged sentences

General and administrative 13,771 15,341 26,281 34,179

Impairment of goodwill, intangible and other assets — 47,060 — 47,060

Depreciation and amortization 8,089 7,762 15,661 15,495

(Gain) loss on sale or disposal of assets and other ( 22 ) 744

Loss on sale or disposal of assets and other 112 261 90 1,005

Total operating expenses 103,121 158,072 202,490 274,662

Operating income 9,021 13,478

Operating income (loss) 10,627 ( 30,710 ) 19,648 ( 17,232 )

Interest expense 5,518 5,881 10,973 11,210

1 unchanged sentence

Equity in net (income) loss of unconsolidated affiliates ( 1,250 ) ( 1,184 ) ( 1,766 ) 4,713

Other (income) expense ( 599 ) 98

Income before income taxes 5,502 2,997

Other expense (income) 145 ( 341 ) ( 454 ) ( 243 )

Income (loss) before income taxes 6,799 ( 34,125 ) 12,301 ( 31,128 )

Income tax expense 1,469 6,749 2,672 8,508

Net income $ 4,299 $ 1,238

Basic earnings per share $ 0.08 $ 0.02

Diluted earnings per share $ 0.08 $ 0.02

Net income (loss) $ 5,330 $ ( 40,874 ) $ 9,629 $ ( 39,636 )

Basic earnings (loss) per share $ 0.10 $ ( 0.74 ) $ 0.17 $ ( 0.71 )

Diluted earnings (loss) per share $ 0.10 $ ( 0.74 ) $ 0.17 $ ( 0.71 )

Weighted-average basic shares outstanding 55,661 55,448 55,509 55,557

1 unchanged sentence

See accompanying notes to unaudited interim condensed consolidated financial statements

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Three Months Ended

Six Months Ended

(in thousands) 2021 2020 2021 2020

Net income $ 4,299 $ 1,238

Other comprehensive income:

Foreign currency translation adjustment 11,277 6,071

Comprehensive income $ 15,576 $ 7,309

Net income (loss) $ 5,330 $ ( 40,874 ) $ 9,629 $ ( 39,636 )

Other comprehensive (loss) income:

Foreign currency translation adjustment, net of tax ( 1,760 ) ( 29,846 ) 9,517 ( 23,775 )

Comprehensive income (loss) $ 3,570 $ ( 70,720 ) $ 19,146 $ ( 63,411 )

See accompanying notes to unaudited interim condensed consolidated financial statements.

4 unchanged sentences

Earnings Accumulated

Comprehensive Loss Total Equity

Comprehensive (Loss) Income Total Equity

(in thousands) Shares Par Value

6 unchanged sentences

Balances as of December 31, 2020 55,599 $ 556 $ 398,269 $ 322,468 $ ( 56,791 ) $ 664,502

Stock compensation — — 1,094 — — 1,094

Transfer of consideration for prior period acquisition 33 — 185 — — 185

Release of restricted stock 212 2 — — — 2

Taxes paid related to net share settlement of equity awards — — ( 109 ) — — ( 109 )

Foreign currency translation loss — — — — ( 1,760 ) ( 1,760 )

Net income — — — 5,330 — 5,330

Balances as of March 31, 2021 55,844 $ 558 $ 399,439 $ 327,798 $ ( 58,551 ) $ 669,244

Common Stock Additional

1 unchanged sentence

Earnings Accumulated

Comprehensive Loss Total Equity

Comprehensive (Loss) Income Total Equity

(in thousands) Shares Par Value

7 unchanged sentences

Balances as of December 31, 2019 55,856 $ 559 $ 407,440 $ 389,928 $ ( 46,327 ) $ 751,600

Stock compensation — — 930 — — 930

Release of restricted stock 13 1 — — — 1

Taxes paid related to net share settlement of equity awards — — ( 63 ) — — ( 63 )

Foreign currency translation loss — — — — ( 29,846 ) ( 29,846 )

Purchase and retirement of treasury stock ( 801 ) ( 9 ) ( 2,136 ) ( 2,050 ) — ( 4,195 )

Net loss — — — ( 40,874 ) — ( 40,874 )

Balances as of March 31, 2020 55,068 $ 551 $ 406,171 $ 347,004 $ ( 76,173 ) $ 677,553

See accompanying notes to unaudited interim condensed consolidated financial statements

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

Six Months Ended

(in thousands) 2021 2020

Operating activities:

Net income $ 4,299 $ 1,238

Adjustments to reconcile net income to net cash flows from operating activities:

Net income (loss) $ 9,629 $ ( 39,636 )

Adjustments to reconcile net income (loss) to net cash flows from operating activities:

Depreciation and amortization 15,661 15,495

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Income taxes 2,573 1,412

Net cash used in operating activities ( 4,513 ) ( 10,918 )

Net cash provided by operating activities 18,721 21,271

Investing activities:

3 unchanged sentences

Capital expenditures, net ( 8,359 ) ( 12,160 )

Net cash used in investing activities ( 15,062 ) ( 6,798 )

Principal collections on notes receivable — 4,000

Net cash provided by investing activities 9,080 28,636

Financing activities:

6 unchanged sentences

Effect of exchange rate changes on cash and cash equivalents and restricted cash 5,000 ( 7,364 )

Net decrease in cash, cash equivalents and restricted cash ( 14,092 ) ( 19,301 )

Net increase in cash, cash equivalents and restricted cash 31,091 35,287

Cash, cash equivalents and restricted cash at beginning of period 312,553 162,442

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In the opinion of management, the accompanying Condensed Consolidated Financial Statements include all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation.

Financial results for the three-month period ended December 31, 2020 are not necessarily indicative of results that may be expected for the fiscal year ending September 30, 2021.

Our business is subject to seasonal variations, and operating results for the three months ended December 31, 2020 and 2019 (the "current quarter" and "prior-year quarter," respectively) are not necessarily indicative of the results of operations for the full fiscal year.

Financial results for the three and six-month periods ended March 31, 2021, are not necessarily indicative of results that may be expected for the fiscal year ending September 30, 2021.

Our business is subject to seasonal variations, and operating results for the three and six months ended March 31, 2021 and 2020 (the "current quarter" and "prior-year quarter," respectively) are not necessarily indicative of the results of operations for the full fiscal year.

There have been no changes that have had a material impact in significant accounting policies as described in our Annual Report on Form 10-K for the year ended September 30, 2020 .

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of EZCORP, Inc., and its wholly owned subsidiaries.

The accompanying Condensed Consolidated Financial Statements include the accounts of EZCORP, Inc.

and its wholly owned subsidiaries.

We use the equity method of accounting for entities in which we have a 50% or less investment and exercise significant influence.

2 unchanged sentences

Reclassifications

The Company has reclassified certain amounts in prior-period financial statements to conform to the current periods presentation.

We have reclassified certain amounts in prior-period financial statements to conform to the current period presentation.

Use of Estimates

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There was no net cumulative effect adjustment to retained earnings as of October 1, 2020 as a result of this adoption.

This amendment did not have a material impact on our balance sheets or cash flows from operations and did not have a significant impact on our operating results.

This amendment did not have a material impact on our balance sheets or cash flows from operations and did not have a material impact on our operating results.

Recently Issued Accounting Pronouncements

7 unchanged sentences

We adopted ASU 2016-13 effective October 1, 2020.

The Company has financing receivables within the scope of ASU 2016-13, specifically pawn loans receivables and related pawn service charges receivables.

We have financing receivables within the scope of ASU 2016-13, specifically pawn loans receivables and related pawn service charges receivables.

Our pawn loans are short-term in nature, typically 30-120 days for U.S.

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We then apply a reserve to pawn service charges receivable at the end of each month using a pawn loan forfeiture rate derived from a trailing twelve-month average, adjusted for seasonality factors.

We have evaluated, on a collective basis, our pawn loans receivables and pawn service charges receivables and determined the new credit loss standard will not have a material impact on our consolidated financial statements, as our current polices appropriately capture lifetime expected credit losses.

The presentation of pawn loans and pawn service charges receivable as separate line items on our consolidated balance sheet will remain unchanged under the new credit loss standard.

As of December 31, 2020, pawn loans and related pawn service charges receivable, net were $ 147.9 million and $ 24.8 million, respectively.

We have evaluated, on a collective basis, our pawn loan receivables and pawn service charge receivables and determined the new credit loss standard did not have a material impact on our consolidated financial statements, as our current polices appropriately capture lifetime expected credit losses.

The presentation of pawn loan and pawn service charge receivable as separate line items on our consolidated balance sheet will remain unchanged under the new credit loss standard.

As of March 31, 2021, pawn loan and related pawn service charge receivable, net were $ 125.3 million and $ 20.8 million, respectively.

OTHER CHARGES

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We recorded $ 20.4 million of such charges for the quarter ended September 30, 2020, and had accrued charges of $ 10.7 million remaining at September 30, 2020.

We had no similar charges for the quarter ended December 31, 2020.

(in millions) Accrued Charges at September 30, 2020 Charges Payments and Adjustments Accrued Charges at December 31, 2020

We had no similar charges for the six months ended March 31, 2021.

(in thousands) Accrued Charges at September 30, 2020 Charges Payments and Adjustments Accrued Charges at December 31, 2020 Charges Payments and Adjustments Accrued Charges at March 31, 2021

Cash charges:

7 unchanged sentences

Three Months Ended

Six Months Ended

(in thousands, except per share amounts) 2021 2020 2021 2020

Net income $ 4,299 $ 1,238

Net income (loss) $ 5,330 $ ( 40,874 ) $ 9,629 $ ( 39,636 )

Earnings per common share

16 unchanged sentences

The table below presents balances of our operating leases:

(in thousands) December 31, 2020 December 31, 2019 September 30,

(in thousands) March 31, 2021 March 31, 2020 September 30,

Right-of-use asset $ 170,479 $ 206,839 $ 183,809

4 unchanged sentences

Three Months Ended

Six Months Ended

(in thousands) 2021 2020 2021 2020

1 unchanged sentence

Variable lease expense 2,923 3,093 5,968 5,900

( 859 ) — ( 1,725 ) —

Total lease expense $ 16,680 $ 18,546 $ 34,058 $ 37,878

(1) Includes sublease rental income.

Lease expense is recognized on a straight-line basis over the lease term with variable lease expense recognized in the period in which the costs are incurred.

1 unchanged sentence

Other supplemental information includes the following for our operating leases:

Three Months Ended

Six Months Ended

Weighted-average remaining contractual lease term (years)

Weighted-average incremental borrowing rate 7.88 % 8.25 %

Maturities of lease liabilities as of December 31, 2020 were as follows (in thousands):

Maturities of lease liabilities as of March 31, 2021 were as follows (in thousands):

Remaining 2021

5 unchanged sentences

Non-current portion $ 138,622

We recorded $ 1.6 million and $ 0.8 million in non-cash additions to our right of use assets and lease liabilities for the quarters ended December 31, 2020 and December 31, 2019, respectively.

We recorded $ 6.6 million and $ 0.9 million in non-cash additions to our right of use assets and lease liabilities for the six months ended March 31, 2021 and March 31, 2020, respectively.

STRATEGIC INVESTMENTS

As of December 31, 2020, we owned 214,183,714 shares, or approximately 34.75 %, of Cash Converters International Limited ("Cash Converters International").

The following tables present summary financial information for Cash Converters International’s most recently reported results at June 30, 2020 after translation to U.S.

As of March 31, 2021, we owned 214,183,714 shares, or 34.75 %, of Cash Converters International Limited ("Cash Converters International").

The following tables present summary financial information for Cash Converters International’s most recently reported results at December 31, 2020 after translation to U.S.

(in thousands) 2020 2019

6 unchanged sentences

Total liabilities and shareholders’ equity $ 360,222 $ 364,183

Fiscal Year Ended June 30,

Half-Year Ended December 31,

(in thousands) 2020 2019

1 unchanged sentence

Gross profit 51,231 59,250

Net loss ( 7,032 ) ( 1,210 )

Net profit (loss) 5,561 ( 13,280 )

See Note 7 for the fair value and carrying value of our investment in Cash Converters International.

10 unchanged sentences

Fair Value Measurement on a Recurring Basis

As of December 31, 2020 and September 30, 2020, we did not have any financial assets or liabilities measured at fair value on a recurring basis.

As of March 31, 2021 and September 30, 2020, we did not have any financial assets or liabilities measured at fair value on a recurring basis.

Financial Assets and Liabilities Not Measured at Fair Value

1 unchanged sentence

Carrying Value Estimated Fair Value

December 31, 2020 December 31, 2020 Fair Value Measurement Using

March 31, 2021 March 31, 2021 Fair Value Measurement Using

(in thousands) Level 1 Level 2 Level 3

6 unchanged sentences

2025 Convertible Notes 136,836 143,175 — 143,175 —

8.5 % unsecured debt due 2024

816 816 — — 816

Carrying Value Estimated Fair Value

December 31, 2019 December 31, 2019 Fair Value Measurement Using

March 31, 2020 March 31, 2020 Fair Value Measurement Using

(in thousands) Level 1 Level 2 Level 3

32 unchanged sentences

All principal and accrued interest is due and payable in April 2024.

The note approximated its carrying value as of December 31, 2020.

The note approximated its carrying value as of March 31, 2021.

We use the equity method of accounting to account for our 34.75 % ownership in Cash Converters International.

The inputs used to generate the fair value of the investment were considered Level 1 inputs.

These inputs are comprised of (a) the quoted stock price on the Australian

Stock Exchange multiplied by (b) the number of shares we owned multiplied by (c) the applicable foreign currency exchange rate as of the end of our reporting period.

These inputs are comprised of (a) the quoted stock price on the Australian Stock Exchange multiplied by (b) the number of shares we owned multiplied by (c) the applicable foreign currency exchange rate as of the end of our reporting period.

We included no control premium for owning a large percentage of outstanding shares.

4 unchanged sentences

As the quoted price inputs are highly variable from day to day, the fair value estimates disclosed above could significantly increase or decrease.

In September 2020, we received the final payment from AlphaCredit on the notes receivable related to the sale of Grupo Finmart and recorded the amount under “Restricted cash” in our consolidated balance sheet as of December 31, 2020.

In August 2019, AlphaCredit notified us of an indemnity claim for certain pre-closing taxes, but the nature, extent and validity of such claim has yet to be determined.

The following table presents the Company's debt instruments outstanding:

December 31, 2020 December 31, 2019 September 30, 2020

March 31, 2021 March 31, 2020 September 30, 2020

(in thousands) Gross Amount Debt Discount and Issuance Costs Carrying Amount Gross Amount Debt Discount and Issuance Costs Carrying Amount Gross Amount Debt Discount and Issuance Costs Carrying Amount

9 unchanged sentences

Certain disclosures omitted due to materiality considerations.

The following table presents the Company's contractual maturities related to the debt instruments as of December 31, 2020:

The following table presents the Company's contractual maturities related to the debt instruments as of March 31, 2021:

Schedule of Contractual Maturities

2 unchanged sentences

2025 Convertible Notes* 172,500 — — 172,500 —

8.5 % unsecured debt due 2024

$ 316,250 $ — $ — $ 316,250 $ —

$ 317,066 $ 213 $ 425 $ 316,428 $ —

* Excludes the potential impact of embedded derivatives as discussed below.

The following table presents the Company's interest expense related to the Convertible Notes for the three months ended December 31, 2020 and 2019:

The following table presents the Company's interest expense related to the Convertible Notes for the three and six months ended March 31, 2021 and 2020:

Three Months Ended

Six Months Ended

(in thousands) 2021 2020 2021 2020

14 unchanged sentences

At maturity, the holders of the 2024 Convertible Notes will be entitled to receive cash equal to the principal of the 2024 Convertible Notes plus accrued interest.

The carrying amount of the 2024 Convertible Notes as a separate equity-classified instrument (the “2024 Convertible Notes Embedded Derivative”) included in “Additional paid-in capital” in our condensed consolidated balance sheets as of December 31, 2020 was $ 39.8 million, ($ 25.3 million, net of tax).

The effective interest rate for the three months ended December 31, 2020 was approximately 9 %.

As of December 31, 2020, the remaining unamortized debt discount and issuance costs will be amortized through the 2024 Maturity Date assuming no early conversion.

The carrying amount of the 2024 Convertible Notes as a separate equity-classified instrument (the “2024 Convertible Notes Embedded Derivative”) included in “Additional paid-in capital” in our condensed consolidated balance sheets as of March 31, 2021 was $ 39.8 million, ($ 25.3 million, net of tax).

The effective interest rate for the three and six months ended March 31, 2021 was approximately 9 %.

As of March 31, 2021, the remaining unamortized debt discount and issuance costs will be amortized through the 2024 Maturity Date assuming no early conversion.

The 2024 Convertible Notes are convertible into cash or shares of Class A Common Stock, or any combination thereof, at our option subject to satisfaction of certain conditions and during the periods described in the 2017 Indenture, based on an initial conversion rate of 100 shares of Class A Common Stock per $1,000 principal amount of 2024 Convertible Notes (equivalent to an initial conversion price of $ 10.00 per share of Class A Common Stock).

2 unchanged sentences

If, among other triggers described in the 2017 Indenture, the market price of the Class A Common Stock meets the threshold based on at least 20 of the final 30 trading days of the quarter for the 2024 Convertible Notes to become convertible at the option of the holders during the subsequent quarter, we may be required to classify the 2024 Convertible Notes as current on our condensed consolidated balance sheets for each quarter in which such triggers are met.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of December 31, 2020.

As of December 31, 2020, the if-converted value of the 2024 Convertible Notes did not exceed the principal amount.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of March 31, 2021.

As of March 31, 2021, the if-converted value of the 2024 Convertible Notes did not exceed the principal amount.

2.375 % 2025 Convertible Senior Notes Due 2025

4 unchanged sentences

The 2025 Convertible Notes pay interest semi-annually in arrears at a rate of 2.375 % per annum on May 1 and November 1 of each year, commencing November 1, 2018, and mature on May 1, 2025 (the "2025 Maturity Date"), unless converted, redeemed or repurchased in accordance with the terms prior to such date.

The carrying amount of the 2025 Convertible Notes as a separate equity-classified instrument (the “2025 Convertible Notes Embedded Derivative”) included in “Additional paid-in capital” in our condensed consolidated balance sheets as of December 31, 2020 was $ 49.6 million, ($ 39.1 million, net of tax).

The effective interest rate for the three months ended December 31, 2020 was approximately 9 %.

As of December 31, 2020, the remaining unamortized debt discount and issuance costs will be amortized through the 2025 Maturity Date assuming no early conversion.

The carrying amount of the 2025 Convertible Notes as a separate equity-classified instrument (the “2025 Convertible Notes Embedded Derivative”) included in “Additional paid-in capital” in our condensed consolidated balance sheets as of March 31, 2021 was $ 49.6 million, ($ 39.1 million, net of tax).

The effective interest rate for the three and six months ended March 31, 2021 was approximately 9 %.

As of March 31, 2021, the remaining unamortized debt discount and issuance costs will be amortized through the 2025 Maturity Date assuming no early conversion.

The 2025 Convertible Notes are convertible into cash or shares of Class A Common Stock, or any combination thereof, at our option subject to satisfaction of certain conditions and during the periods described in the 2018 Indenture, based on an initial conversion rate of 62.8931 shares of Class A Common Stock per $1,000 principal amount of 2025 Convertible Notes (equivalent to an initial conversion price of $ 15.90 per share of Class A Common Stock).

2 unchanged sentences

If, among other triggers described in the 2018 Indenture, the market price of the Class A Common Stock meets the threshold based on at least 20 of the final 30 trading days of the quarter for the 2025 Convertible Notes to become convertible at the option of the holders during the subsequent quarter, we may be required to classify the 2025 Convertible Notes as current on our condensed consolidated balance sheets for each quarter in which such triggers are met.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of December 31, 2020.

As of December 31, 2020, the if-converted value of the 2025 Convertible Notes did not exceed the principal amount.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of March 31, 2021.

As of March 31, 2021, the if-converted value of the 2025 Convertible Notes did not exceed the principal amount.

CASHMA X Secured Borrowing Facility

2 unchanged sentences

See our 2020 Annual Report for additional information regarding the closure of our Canadian operations.

Prior to the termination of the facility, a variable interest entity (the "trust") had the right, subject to various conditions, to borrow up to CAD $ 25 million from the lender (the "third-party loan") and use the proceeds to purchase interests in installment loan receivables generated by CASHMAX.

The trust used collections on the transferred receivables to pay various amounts in accordance with an agreed priority arrangement, including expenses, its obligations under the third-party loan and, to the extent available, amounts owned to CASHMAX with respect to the purchase price of the transferred receivables and CASHMAX's retained interest in the receivables.

CASHMAX had no obligation with respect to the third-party loan or the transferred receivables except to (a) service the underlying installment loans on behalf of the trust and (b) pay amounts owed under or repurchase the underlying installment loans in the event of a breach by CASHMAX or in certain other limited circumstances.

The facility was nonrecourse to EZCORP (subject to certain limited guaranty obligations), allowed borrowing through November 2019, and was to fully mature in November 2021.

SHARE-BASED COMPENSATION

2 unchanged sentences

Repurchases under the program were suspended in March 2020 in order to preserve liquidity as a result of uncertainties related to the COVID-19 pandemic.

No share repurchases under the program were made during the first quarter of fiscal 2021.

No share repurchases under the program have been made during fiscal 2021.

During fiscal 2020, we repurchased and retired 943,149 shares of our Class A Common Stock for $ 5.2 million, which was allocated between "Additional paid-in capital" and "Retained earnings" in our condensed consolidated balance sheets.

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Awards granted under the Incentive Plan are measured at the grant date fair value with compensation costs associated with the awards recognized over the requisite service period, usually the vesting period, on a straight-line basis.

During the first quarter of fiscal 2021, we granted a total of 143,145 restricted stock awards to our non-employee directors.

These awards vest on March 31, 2021 and are subject only to service conditions.

The number of long-term incentive award shares and units granted are generally determined based on our share price as of the beginning of the fiscal year, which was $ 5.03 for fiscal 2021 awards.

During the first quarter of fiscal 2020, we granted a total of 222,912 shares of restricted stock awards to non-employee directors based on a share price of $ 6.46 .

In December 2020, we granted 143,145 restricted stock awards to our non-employee directors at a grant date fair value of $ 5.03 .

These awards vested in February 2021 ( 79,525 awards) and March 2021 ( 63,620 awards).

In February 2021, we granted 127,744 restricted stock awards to our non-employee directors at a grant date fair value of $ 5.01 , which awards will vest at the next annual meeting of stockholders, but no later than March 31, 2022.

In January 2021, we granted 289,592 restricted stock awards to employees at a grant date fair value of $ 4.68 and 275,107 restricted stock awards to employees at a grant date fair value of $ 4.71 .

These awards vest on September 30, 2021 and September 30, 2022, respectively.

In February 2021, we granted 392,419 restricted stock awards to employees at a grant date fair value of $ 4.96 , which vest on September 30, 2023.

During the first quarter of fiscal 2020, we granted 222,912 shares of restricted stock awards to non-employee directors based on a share price of $ 6.46 .

These awards vested on September 30, 2020.

1 unchanged sentence

We recognized the effect on the consolidated financial statements in the period ended March 31, 2020.

For the period ended December 31, 2020, the CARES Act has not had a material impact on our consolidated financial statements.

At this time,

we do not expect the impact of the CARES Act to have a material impact on our consolidated financial statements for the year ending September 30, 2021.

For the period ended March 31, 2021, the CARES Act has not had a material impact on our consolidated financial statements.

At this time, we do not expect the impact of the CARES Act to have a material impact on our consolidated financial statements for the year ending September 30, 2021.

COMMITMENTS AND CONTINGENCIES

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The following tables present revenue for each reportable segment, disaggregated revenue within our three reportable segments and Corporate, segment profits and segment contribution.

Three Months Ended December 31, 2020

Three Months Ended March 31, 2021

(in thousands) U.S.

7 unchanged sentences

Jewelry scrapping cost of goods sold 3,149 2,252 — 5,401 — 5,401

Other cost of revenues — — — — — —

Net revenues 92,053 21,521 174 113,748 — 113,748

3 unchanged sentences

Depreciation and amortization 2,636 1,793 — 4,429 3,660 8,089

Loss (gain) on sale or disposal of assets and other 27 ( 101 ) — ( 74 ) 52 ( 22 )

Loss on sale or disposal of assets and other — 101 — 101 11 112

Interest expense — — — — 5,518 5,518

1 unchanged sentence

Equity in net income of unconsolidated affiliates — — ( 1,250 ) ( 1,250 ) — ( 1,250 )

Other (income) expense — ( 455 ) ( 210 ) ( 665 ) 66 ( 599 )

Other expense — 85 9 94 51 145

Segment contribution $ 25,760 $ 2,621 $ 1,415 $ 29,796

Income (loss) before income taxes $ 29,796 $ ( 22,997 ) $ 6,799

Three Months Ended December 31, 2019

Three Months Ended March 31, 2020

(in thousands) U.S.

12 unchanged sentences

General and administrative — — — — 15,341 15,341

Impairment of goodwill, intangible and other assets 10,000 35,936 1,124 47,060 — 47,060

Depreciation and amortization 2,711 1,940 23 4,674 3,088 7,762

(Gain) loss on sale or disposal of assets and other — ( 123 ) — ( 123 ) 384 261

Interest expense — 402 154 556 5,325 5,881

Interest income — ( 369 ) — ( 369 ) ( 572 ) ( 941 )

Equity in net income of unconsolidated affiliates — — ( 1,184 ) ( 1,184 ) — ( 1,184 )

Other (income) expense — ( 309 ) 20 ( 289 ) ( 52 ) ( 341 )

Segment contribution (loss) $ 20,421 $ ( 30,141 ) $ ( 891 ) $ ( 10,611 )

Loss before income taxes $ ( 10,611 ) $ ( 23,514 ) $ ( 34,125 )

Six Months Ended March 31, 2021

(in thousands) U.S.

Pawn Latin America Pawn Other International Total Segments Corporate Items Consolidated

Merchandise sales $ 176,080 $ 46,928 $ — $ 223,008 $ — $ 223,008

Jewelry scrapping sales 7,585 5,249 — 12,834 — 12,834

Pawn service charges 99,797 27,128 — 126,925 — 126,925

Other revenues 51 7 249 307 — 307

Total revenues 283,513 79,312 249 363,074 — 363,074

Merchandise cost of goods sold 99,871 30,462 — 130,333 — 130,333

Jewelry scrapping cost of goods sold 5,993 4,610 — 10,603 — 10,603

Other cost of revenues — — — — —

Net revenues 177,649 44,240 249 222,138 — 222,138

Segment and corporate expenses (income):

Store expenses 125,749 34,709 — 160,458 — 160,458

General and administrative — — — — 26,281 26,281

Depreciation and amortization 5,372 3,653 — 9,025 6,636 15,661

Loss on sale or disposal of assets and other 27 — — 27 63 90

1 unchanged sentence

Interest income — ( 1,335 ) — ( 1,335 ) ( 71 ) ( 1,406 )

Equity in net income of unconsolidated affiliates — — ( 1,766 ) ( 1,766 ) — ( 1,766 )

Other (income) expense — ( 370 ) ( 201 ) ( 571 ) 117 ( 454 )

Segment contribution $ 46,501 $ 7,583 $ 2,216 $ 56,300

Income (loss) before income taxes $ 56,300 $ ( 43,999 ) $ 12,301

Six Months Ended March 31, 2020

(in thousands) U.S.

Pawn Latin America Pawn Other International Total Segments Corporate Items Consolidated

Merchandise sales $ 197,801 $ 58,757 $ — $ 256,558 $ — $ 256,558

Jewelry scrapping sales 15,776 5,630 — 21,406 — 21,406

Pawn service charges 125,790 39,157 — 164,947 — 164,947

Other revenues 67 50 2,686 2,803 — 2,803

Total revenues 339,434 103,594 2,686 445,714 — 445,714

Merchandise cost of goods sold 126,650 43,202 — 169,852 — 169,852

Jewelry scrapping cost of goods sold 12,555 4,816 — 17,371 — 17,371

Other cost of revenues — 37 1,024 1,061 — 1,061

Net revenues 200,229 55,539 1,662 257,430 — 257,430

Segment and corporate expenses (income):

Store expenses 135,678 38,452 2,793 176,923 — 176,923

General and administrative — — — — 34,179 34,179

Impairment of goodwill, intangible and other assets 10,000 35,936 1,124 47,060 — 47,060

Depreciation and amortization 5,576 3,829 57 9,462 6,033 15,495

(Gain) loss on sale or disposal of assets and other — ( 95 ) — ( 95 ) 1,100 1,005

Interest expense — 430 324 754 10,456 11,210

Interest income — ( 757 ) — ( 757 ) ( 1,027 ) ( 1,784 )

Equity in net loss of unconsolidated affiliates — — 4,713 4,713 — 4,713

Other expense (income) — 67 ( 1 ) 66 32 98

Other (income) expense — ( 242 ) 19 ( 223 ) ( 20 ) ( 243 )

Segment contribution (loss) $ 48,975 $ ( 22,014 ) $ ( 7,368 ) $ 19,593

1 unchanged sentence

SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION

The following table provides supplemental information on net amounts included in our condensed consolidated balance sheets and condensed consolidated statements of cash flows:

(in thousands) December 31, 2020 December 31, 2019 September 30,

The following table provides supplemental information on net amounts included in our condensed consolidated balance sheets:

(in thousands) March 31, 2021 March 31, 2020 September 30,

Gross pawn service charges receivable $ 26,607 $ 34,843 $ 27,259

15 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements