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Item 1. Financial Statements

2025-02-05 compared with 2024-07-31 · 119 added, 225 removed, 533 unchanged (39% of the section changed)

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts) June 30,

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

September 30,

33 unchanged sentences

issued and outstanding:

51,771,917 as of June 30, 2024;

52,214,761 as of June 30, 2023;

52,050,550 as of December 31, 2024;

52,272,594 as of December 31, 2023;

and 51,582,698 as of September 30, 2024

10 unchanged sentences

Three Months Ended

Nine Months Ended

(in thousands, except per share amount) 2024 2023

12 unchanged sentences

Loss (gain) on sale or disposal of assets and other 8 ( 172 )

Other income — ( 2,632 ) ( 765 ) ( 5,097 )

Total operating expenses 143,463 135,491

2 unchanged sentences

Interest income ( 2,093 ) ( 2,639 )

Equity in net (income) loss of unconsolidated affiliates ( 1,263 ) ( 1,523 ) ( 4,135 ) 29,394

Other income ( 191 ) ( 5 ) ( 627 ) ( 159 )

Equity in net income of unconsolidated affiliates ( 1,475 ) ( 1,153 )

Other expense (income) 978 ( 271 )

Income before income taxes

41,384 37,705

Income tax expense 10,368 9,235

7 unchanged sentences

Three Months Ended

Nine Months Ended

(in thousands) 2024 2023

1 unchanged sentence

Other comprehensive income:

Foreign currency translation adjustment, net of income tax (benefit) expense for our investment in unconsolidated affiliate of $( 101 ) and $( 30 ) for the three months ended June 30, 2024, and 2023, respectively and $( 60 ) and $ 706 for the nine months ended June 30, 2024, and 2023, respectively

Foreign currency translation adjustment, net of income tax (expense) benefit for our investment in unconsolidated affiliate of $( 106 ) and $ 57 for the three months ended December 31, 2024, and 2023, respectively.

( 7,319 ) 4,633

11 unchanged sentences

Taxes paid related to net share settlement of equity awards — — ( 3,971 ) — — ( 3,971 )

Foreign currency translation gain — — — — 4,633 4,633

Purchase and retirement of treasury stock ( 355 ) ( 4 ) ( 1,322 ) ( 1,681 ) — ( 3,007 )

Net income — — — 28,470 — 28,470

Balances as of December 31, 2023 55,243 $ 553 $ 343,870 $ 457,929 $ ( 27,469 ) $ 774,883

Stock compensation — — 2,580 — — 2,580

Release of restricted stock, net of shares withheld for taxes 89 1 ( 1 ) — — —

Foreign currency translation gain — — — — 4,457 4,457

Purchase and retirement of treasury stock ( 305 ) ( 3 ) ( 1,275 ) ( 1,725 ) — ( 3,003 )

Net income — — — 21,479 — 21,479

Balances as of March 31, 2024 55,027 $ 551 $ 345,174 $ 477,683 $ ( 23,012 ) $ 800,396

Stock compensation — — 3,101 — — 3,101

Foreign currency translation loss — — — — ( 7,319 ) ( 7,319 )

1 unchanged sentence

Net income — — — 31,016 — 31,016

Balances as of June 30, 2024 54,742 $ 548 $ 347,082 $ 493,830 $ ( 40,005 ) $ 801,455

Balances as of December 31, 2024 55,021 $ 550 $ 345,783 $ 536,427 $ ( 58,866 ) $ 823,894

Common Stock Additional

5 unchanged sentences

Stock compensation — — 2,264 — — 2,264

Transfer of equity consideration for acquisition 10 — 99 — — 99

Release of restricted stock, net of shares withheld for taxes 758 8 — — — 8

4 unchanged sentences

Balances as of December 31, 2023 55,243 $ 553 $ 343,870 $ 457,929 $ ( 27,469 ) $ 774,883

Stock compensation — — 1,855 — — 1,855

Release of restricted stock, net of shares withheld for taxes 132 2 — — — 2

Taxes paid related to net share settlement of equity awards ( 1 ) — ( 11 ) — — ( 11 )

Foreign currency translation gain — — — — 16,148 16,148

Purchase and retirement of treasury stock ( 448 ) ( 5 ) ( 1,768 ) ( 2,178 ) — ( 3,951 )

Net loss — — — ( 6,790 ) — ( 6,790 )

Balances as of March 31, 2023 55,531 $ 556 $ 343,088 $ 405,961 $ ( 37,017 ) $ 712,588

Stock compensation — — 3,135 — — 3,135

Foreign currency translation gain — — — — 8,101 8,101

Purchase and retirement of treasury stock ( 346 ) ( 4 ) ( 1,366 ) ( 1,634 ) — ( 3,004 )

Net income — — — 18,222 — 18,222

Balances as of June 30, 2023 55,185 $ 552 $ 344,857 $ 422,549 $ ( 28,916 ) $ 739,042

See accompanying notes to unaudited condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended

Three Months Ended

(in thousands) 2024 2023

9 unchanged sentences

Stock compensation expense 2,597 2,264

Equity in net (income) loss from investment in unconsolidated affiliates ( 4,135 ) 29,394

Net loss on extinguishment of debt — 3,545

Equity in net income from investment in unconsolidated affiliates ( 1,475 ) ( 1,153 )

Changes in operating assets and liabilities, net of business acquisitions:

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Income taxes 9,000 8,309

Dividends from unconsolidated affiliates — 3,589

Net cash provided by operating activities 25,991 21,481

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Capital expenditures, net ( 5,609 ) ( 7,184 )

Acquisitions, net of cash acquired ( 11,963 ) ( 12,968 )

Proceeds from (issuance of) notes receivable 1,100 ( 15,500 )

Investment in unconsolidated affiliate ( 993 ) ( 2,133 )

Investment in other investments — ( 15,000 )

Dividends from unconsolidated affiliates 1,902 1,745

Other ( 148 ) ( 677 )

Net cash used in investing activities ( 14,040 ) ( 16,864 )

1 unchanged sentence

Taxes paid related to net share settlement of equity awards ( 3,971 ) ( 3,253 )

Proceeds from issuance of debt — 230,000

Debt issuance cost — ( 7,458 )

Cash paid on extinguishment of debt — ( 1,951 )

Payments on debt — ( 178,488 )

Purchase and retirement of treasury stock ( 3,000 ) ( 3,007 )

Payments of finance leases ( 131 ) ( 132 )

Net cash (used in) provided by financing activities ( 12,648 ) 26,972

Net cash used in financing activities ( 7,102 ) ( 6,392 )

Effect of exchange rate changes on cash and cash equivalents and restricted cash ( 764 ) ( 207 )

Net (decrease) increase in cash, cash equivalents and restricted cash ( 1,726 ) 32,154

Net increase (decrease) in cash, cash equivalents and restricted cash 4,085 ( 1,982 )

Cash and cash equivalents and restricted cash at beginning of period 179,807 228,968

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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 and nine month periods ended June 30, 2024, are not necessarily indicative of results that may be expected for the fiscal year ending September 30, 2024 or any other period due, in part, to seasonal variations.

Financial results for the three month period ended December 31, 2024, are not necessarily indicative of results that may be expected for the fiscal year ending September 30, 2025 or any other period due, in part, to seasonal variations.

There have been no changes that have had a material impact in significant accounting policies as described in our 2024 Annual Report .

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Actual results may differ materially from these estimates under different assumptions or conditions.

Merchandise Sales Revenue Recognition

Merchandise Sales Revenues Recognition

Customer layaway deposits are recorded as liabilities when a customer provides a deposit for merchandise.

Customer layaway deposits are generally refundable upon cancellation.

Our customer layaway deposits balance as of June 30, 2024, 2023 and September 30, 2023 was $ 20.1 million, $ 18.6 million and $ 18.9 million, respectively, and are generally recognized as revenue within a one-year period.

Upon cancellation, customer layaway deposits are generally refundable, less a cancellation fee, via credit slip.

Our customer layaway deposits balance as of December 31, 2024, 2023 and September 30, 2024 was $ 24.2 million, $ 18.3 million and $ 21.6 million, respectively, and are generally recognized as revenues within a one-year period.

We account for our investment in Rich Data Corporation (“RDC”) in accordance with Accounting Standards Codification (“ASC”) 321, Investments — Equity Securities, and we have elected to use the measurement alternative to measure this investment at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer, if any.

As of June 30, 2024, 2023 and September 30, 2023, the carrying value of our investment in RDC was $ 6.2 million.

As of December 31, 2024, 2023 and September 30, 2024, the carrying value of our investment in RDC was $ 6.2 million.

Refer to Note 5:

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This standard is not expected to have a significant impact on our consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses (“ASU 2024-03”).

Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03.

ASU 2024-03 requires disclosure in the notes to the financial statements of specified information about certain costs and expenses.

The requirements of ASU 2024-03 are effective for the Company for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted and should be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to any or all period periods presented in the financial statements.

We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-04, Debt - Debt with Conversions and Other Options (Subtopic 470-20):

Induced Conversions of Convertible Debt Instruments (“ASU 2024-04”).

ASU 2024-04 clarifies the requirements for determining whether certain settlements of convertible debt instruments, including convertible debt instruments with cash conversion features or convertible debt instruments that are not currently convertible, should be accounted for as an induced conversion.

The requirements of ASU 2024-04 are effective for the Company for fiscal years beginning after December 15, 2025, and interim periods within those periods.

Early adoption is permitted for all entities that have adopted the amendments in ASU 2020-06 and can be applied on a prospective or retrospective basis.

We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures.

The following table summarizes the changes in the carrying amount of goodwill by segment and in total:

Nine Months Ended June 30, 2024

Three Months Ended December 31, 2024

(in thousands) U.S.

2 unchanged sentences

$ 264,428 $ 42,050 $ 306,478

Acquisitions (a)

8,329 — 8,329

Effect of foreign currency translation changes — ( 1,756 ) ( 1,756 )

Balances as of June 30, 2024 $ 264,271 $ 44,576 $ 308,847

Nine Months Ended June 30, 2023

Balances as of December 31, 2024 $ 264,428 $ 40,294 $ 304,722

Three Months Ended December 31, 2023

(in thousands) U.S.

3 unchanged sentences

Acquisitions (a)

9,468 — 9,468

Effect of foreign currency translation changes — 1,011 1,011

Balances as of June 30, 2023

Balances as of December 31, 2023

$ 256,358 $ 47,441 $ 303,799

(a) Amount represents goodwill recognized in connection with acquisitions within the U.S.

Pawn segment that were immaterial, individually and in the aggregate, and we have therefore omitted certain disclosures.

(a) Amount represents goodwill recognized in connection with an immaterial acquisition within the U.S.

Pawn segment and we have therefore omitted certain disclosures.

EARNINGS PER SHARE

1 unchanged sentence

Three Months Ended

Nine Months Ended

(in thousands, except per share amounts) 2024 2023

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Potential common shares excluded from the calculation of diluted earnings per common share above:

Convertible Notes*** — — — 6,323

Restricted stock*** 1,437 1,581

Total 1,917 1,705 1,913 8,051

* Effective January 1, 2024, we are required to combination settle the 2024 Convertible Notes.

As such, no interest expense is included in the diluted earnings per share computation for the three months ended June 30, 2024 and only the first quarter of 2024 interest expense is included for the nine months ended June 30, 2024.

The nine months ended June 30,2023 includes $ 5.4 million gain on the partial extinguishment of debt, associated with the 2025 Convertible Notes, which was recorded to “Interest expense” in the Company’s condensed consolidated statement of operations.

Debt for additional information.

* The Company’s debt (collectively, the “Convertible Notes”) includes the 2.375 % Convertible Senior Notes Due 2025 (the “2025 Convertible Notes”), the 3.750 % Convertible Senior Notes Due 2029 (the “2029 Convertible Notes”) and the three months ended December 31, 2023 also includes the 2.875 % Convertible Senior Notes Due 2024 (the “2024 Convertible Notes”).

Debt for conversion price, initial conversion rate and additional information.

** Includes time-based share-based awards and performance-based awards for which targets for fiscal year tranches have been achieved and vesting is subject only to achievement of service conditions.

*** As we are required to combination settle the 2024 Convertible Notes effective January 1, 2024, the 3.4 million principal shares are not included for the three months ended June 30, 2024 and only the weighted average shares of 1.2 million are included for the nine months ended June 30, 2024.

Additionally, 75,854 and 25,192 potential common shares related to the accreted value of the 2024 Convertible Notes are included for the three and nine months ended June 30, 2024, respectively, as the average market rate was above the initial conversion price of $ 10.00 per share for the period ended June 30, 2024.

Debt for conversion price, initial conversion rate and additional information on the 2024 Convertible Notes, 2025 Convertible Notes, and 2029 Convertible Notes.

*** Includes antidilutive share-based awards as well as performance-based share-based awards that are contingently issuable, but for which the condition for issuance has not been met as of the end of the reporting period.

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The table below presents balances of our lease assets and liabilities and their balance sheet locations for both operating and financing leases:

(in thousands) Balance Sheet Location June 30, 2024 June 30, 2023 September 30, 2023

(in thousands) Balance Sheet Location December 31, 2024 December 31, 2023 September 30, 2024

Lease assets:

Operating lease right-of-use assets Right-of-use assets, net $ 227,810 $ 231,103 $ 226,602

Financing lease assets Other assets 1,832 2,076 2,178

Financing lease assets Other assets, net 1,340 2,124 1,559

Total lease assets $ 229,150 $ 233,227 $ 228,161

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Three Months Ended

Nine Months Ended

(in thousands) 2024 2023

8 unchanged sentences

Total lease cost $ 23,445 $ 23,497

* Includes a reduction for sublease rental income of $ 0.7 million and $ 1.0 million for the three months ended June 30, 2024 and 2023, respectively, and $ 2.4 million and $ 2.8 million for the nine months ended June 30, 2024 and 2023, respectively.

* Includes a reduction for sublease rental income of $ 0.6 million and $ 1.1 million for the three months ended December 31, 2024 and 2023, respectively.

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.

The components of lease expense are included in “Store expenses” and “General and administrative” under operating expenses, based on the underlying lease use.

Cash paid for operating leases was $ 15.9 million and $ 19.5 million for the three months ended June 30, 2024 and 2023, respectively, and $ 60.5 million and $ 56.9 million for the nine months ended June 30, 2024 and 2023, respectively.

Cash paid for principal and interest on finance leases was $ 0.1 million and $ 0.1 million, respectively, for the three months ended June 30, 2024 and $ 0.4 million and $ 0.2 million for the nine months ended June 30, 2024 respectively .

There was no cash paid for principal or interest on finance leases during the three and nine months ended June 30, 2023.

Cash paid for operating leases was $ 20.0 million and $ 20.3 million for the three months ended December 31, 2024 and 2023, respectively.

Cash paid for principal and interest on finance leases was $ 0.1 million and less than $ 0.1 million, respectively, for the three months ended December 31, 2024 and $ 0.1 million and $ 0.1 million, respectively, for the three months ended December 31, 2023 .

The weighted-average term and discount rates for leases are as follows:

Nine Months Ended

Three Months Ended

Weighted-average remaining lease term (years):

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Financing leases 11.14 % 11.14 %

As of June 30, 2024, maturities of lease liabilities under ASC 842 by fiscal year were as follows:

As of December 31, 2024, maturities of lease liabilities under ASC 842 by fiscal year were as follows:

(in thousands) Operating Leases Financing Leases

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Total long-term net lease liabilities

We recorded $ 46.1 million and $ 55.2 million in non-cash additions to our operating right-of-use assets and lease liabilities for the nine months ended June 30, 2024 and 2023, respectively.

We recorded $ 0.3 million and $ 2.1 million in non-cash finance lease additions for the nine months ended June 30, 2024 and 2023, respectively.

$ 182,228 $ 907

We recorded $ 18.2 million and $ 9.3 million in non-cash additions to our operating right-of-use assets and lease liabilities for the three months ended December 31, 2024 and 2023, respectively.

We recorded no non-cash finance lease additions for the three months ended December 31, 2024 and $ 0.1 million for the three months ended December 31, 2023.

STRATEGIC INVESTMENTS

Cash Converters International Limited

As of June 30, 2024, we owned 273,939,157 shares, or approximately 43.7 %, of Cash Converters.

We acquired our original investment (representing approximately 30 % of the outstanding shares) in November 2009 and have increased our ownership through the acquisition of additional shares periodically since that time.

We received cash dividends from Cash Converters of $ 3.5 million and $ 3.6 million during th e nine mon ths ended June 30, 2024 and 2023, respectively.

The following tables present summary financial information for Cash Converters’ most recently reported results at December 31, 2023 after translation to U.S.

As of December 31, 2024, we owned 273,939,157 shares, or approximately 43.7 %, of Cash Converters.

We acquired our original investment in November 2009 and have increased our ownership through the acquisition of additional shares periodically since that time.

We received cash dividends from Cash Converters of $ 1.9 million and $ 1.7 million during th e three mon ths ended December 31, 2024 and 2023, respectively.

The following tables present summary financial information for Cash Converters’ most recently reported results as applicable after translation to U.S.

(in thousands) 2024 2023

6 unchanged sentences

Total liabilities and shareholders’ equity $ 318,692 $ 293,158

Half-Year Ended December 31,

Full-Year Ended June 30,

(in thousands) 2024 2023

2 unchanged sentences

Net profit (loss) $ 11,420 $ ( 65,351 )

During the three and nine m onths ended June 30, 2024, we recorded our share of income of $ 1.4 million and $ 4.3 million, respectively, from Cash Converters.

During the three and nine months ended June 30, 2023, we recorded our share of income of $ 1.5 million and a $ 29.4 million loss on our share of losses from Cash Converters, respectively, included in “Equity in net (income) loss of unconsolidated affiliates” in the condensed consolidated statements of operations.

For the nine months ended June 30, 2023, the $ 29.4 million loss includes $ 32.4 million of our share of their non-cash goodwill impairment charge.

During the three m onths ended December 31, 2024, and 2023 we recorded our share of income of $ 1.6 million and $ 1.2 million, respectively, from Cash Converters, included in “Equity in net income of unconsolidated affiliates” in the condensed consolidated statements of operations.

Fair Value Measurements for the fair value and carrying value of our investment in Cash Converters.

Founders One, LLC

In October 2021, we invested $ 15.0 million in exchange for a non-redeemable voting participating preferred equity interest in Founders One, LLC (“Founders”), a then newly-formed entity with one other member.

On December 2, 2022, we contributed an additional $ 15.0 million to Founders associated with our preferred interest.

In addition, we loaned $ 15.0 million to Founders in exchange for a Demand Promissory Note secured by the common interest in Founders held by the other member.

In October 2023, we contributed an additional $ 15.0 million to Founders associated with our preferred interest, bringing our total preferred equity investment in Founders to $ 45.0 million.

In fiscal 2022, we invested $ 15.0 million in exchange for a non-redeemable voting participating preferred equity interest in Founders One, LLC (“Founders”), a then newly-formed entity with one other member.

In fiscal 2023, we contributed an additional $ 15.0 million associated with our preferred interest and loaned Founders $ 15.0 million in exchange for a Demand Promissory Note secured by the common interest held by the other member.

In fiscal 2024, we contributed an additional $ 15.0 million associated with our preferred interest, bringing our total preferred equity investment in Founders to $ 45.0 million.

We have an interest in Founders, a variable interest entity, but because the Company is not the primary beneficiary, we do not consolidate Founders.

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Consequently, our preferred equity investment in Founders is accounted for utilizing the measurement alternative within ASC 321, Investments — Equity Securities.

As of June 30, 2024, our $ 45.0 million carrying value of the preferred equity investment and $ 15.0 million Demand Promissory Note are included in “Other investments” and “Prepaid expenses and other current assets” in our condensed consolidated balance sheets, respectively.

As of June 30, 2024, our maximum exposure for losses related to our investment in Founders was our $ 45.0 million preferred equity investment and $ 15.0 million Demand Promissory Note plus accrued and unpaid interest.

As of December 31, 2024, our $ 45.0 million carrying value of the preferred equity investment and $ 15.0 million Demand Promissory Note are included in “Other investments” and “Prepaid expenses and other current assets” in our condensed consolidated balance sheets, respectively.

As of December 31, 2024, our maximum exposure for losses related to our investment in Founders was our $ 45.0 million preferred equity investment and $ 15.0 million Demand Promissory Note plus accrued and unpaid interest.

Fair Value Measurements for the fair value and carrying value of our loan to Founders.

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Carrying Value Estimated Fair Value

June 30, 2024 June 30, 2024 Fair Value Measurement Using

December 31, 2024 December 31, 2024 Fair Value Measurement Using

(in thousands) Level 1 Level 2 Level 3

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2029 Convertible Notes 224,505 289,887 — 289,887 —

2029 Convertible Notes 223,998 262,564 — 262,564 —

Carrying Value Estimated Fair Value

June 30, 2023 June 30, 2023 Fair Value Measurement Using

December 31, 2023 December 31, 2023 Fair Value Measurement Using

(in thousands) Level 1 Level 2 Level 3

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Financial assets:

Promissory note receivable due April 2024 $ 1,251 $ 1,251 $ — $ — $ 1,251

Promissory note receivable from Founders $ 15,722 $ 15,722 $ — $ — $ 15,722

3 unchanged sentences

2029 Convertible Notes 224,256 273,700 — 273,700 —

2029 Convertible Notes 223,284 224,112 — 224,112 —

Based primarily on the short-term nature of cash and cash equivalents, pawn loans, pawn service charges receivable and other liabilities, we estimate that their carrying value approximates fair value.

1 unchanged sentence

Significant increases or decreases in the underlying assumptions used to value pawn loans, pawn service charges receivable, fees and interest receivable and other debt could significantly increase or decrease these fair value estimates.

The Company remeasured its acquisition-related contingent obligation associated with the acquisition in June 2021 of PLO del Bajio S.

de C.V., which owned stores operating under the name “Cash Apoyo Efectivo,” at the end of each reporting period.

This remeasurement resulted in a $ 2.6 million and $ 5.1 million reduction of the obligation with an offset recorded to “Other” as an operating item in our condensed consolidated statement of operations during the three and nine months ended June 30, 2023, respectively.

There is no remaining obligation in our Consolidated Balance Sheet as of June 30, 2023.

The key assumptions used to determine the fair value of acquisition-related contingent consideration are estimated by management, not observable in the market and, therefore, considered Level 3 inputs within the fair value hierarchy.

In March 2019, we received $ 1.1 million in previously escrowed seller funds as a result of settling certain indemnification claims with the seller of GPMX.

In fiscal 2023, we loaned $ 15.0 million to Founders in exchange for a Demand Promissory Note secured by the common interest in Founders held by the other member.

As of December 31, 2024, the interest rate on the note was 15.00 % per annum, and all principal and accrued interest is due on demand.

Based primarily on the short-term nature of the note, we estimate that its carrying value approximates fair value as of December 31, 2024.

In fiscal 2019, we received $ 1.1 million in previously escrowed seller funds as a result of settling certain indemnification claims with the seller of GPMX.

In April 2019, we loaned the $ 1.1 million back to the seller of GPMX in exchange for a promissory note.

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All principal and accrued interest was received in April 2024.

In December 2022, we loaned $ 15.0 million to Founders in exchange for a Demand Promissory Note secured by the common interest in Founders held by the other member.

As of June 30, 2024, the interest rate on the note was 15.00 % per annum, and all principal and accrued interest is due on demand.

Based primarily on the short-term nature of the note, we estimate that its carrying value approximates fair value as of June 30, 2024.

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

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

June 30, 2024 June 30, 2023 September 30, 2023

December 31, 2024 December 31, 2023 September 30, 2024

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

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Total long-term debt $ 230,000 $ ( 5,495 ) $ 224,505 $ 333,373 $ ( 7,150 ) $ 326,223 $ 230,000 $ ( 5,744 ) $ 224,256

The following table presents the Company’s contractual maturities related to the debt instruments as of June 30, 2024:

The following table presents the Company’s contractual maturities related to the debt instruments as of December 31, 2024:

Schedule of Contractual Maturities

(in thousands) 2029 Convertible Notes 2025 Convertible Notes 2024 Convertible Notes Total

(in thousands) 2029 Convertible Notes 2025 Convertible Notes Total

Remaining 2025 $ — $ 103,373 $ 103,373

— 103,373 — 103,373

Thereafter 230,000 — 230,000

Total long-term debt $ 230,000 $ 103,373 $ 333,373

The following table presents the Company’s interest expense related to the Convertible Notes for the three and nine months ended June 30, 2024 and 2023:

The following table presents the Company’s interest expense related to the Convertible Notes for the three months ended December 31, 2024 and 2023:

Three Months Ended

Nine Months Ended

(in thousands) 2024 2023

6 unchanged sentences

Amortization of deferred financing costs 133 131

Gain on extinguishment — — — ( 5,389 )

Total interest expense $ 747 $ 745

2 unchanged sentences

Amortization of deferred financing costs — 42

Loss on extinguishment — — — 8,935

Total interest expense $ — $ 289

3.750 % Convertible Senior Notes Due 2029

In December 2022, we issued $ 230.0 million aggregate principal amount of 3.750 % Convertible Senior Notes Due 2029 (the “2029 Convertible Notes”), for which $ 230.0 million remains outstanding as of June 30, 2024.

2029 Convertible Notes

In December 2022, we issued $ 230.0 million aggregate principal amount of the 2029 Convertible Notes, for which $ 230.0 million remains outstanding as of December 31, 2024.

The 2029 Convertible Notes were issued pursuant to an indenture dated December 12, 2022 (the “2022 Indenture”) by and between the Company and Truist Bank, as trustee.

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At maturity, the holders of the 2029 Convertible Notes will be entitled to receive cash equal to the principal of the 2029 Convertible Notes plus accrued interest.

The effective interest rate for the three and nine months ended June 30, 2024 was approximately 4.28 %.

As of June 30, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2029 Maturity Date assuming no early conversion.

The effective interest rate for the three months ended December 31, 2024 was approximately 4.28 %.

As of December 31, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2029 Maturity Date assuming no early conversion.

The 2029 Convertible Notes are convertible based on an initial conversion rate of 89.0313 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $ 11.23 per share).

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The redemption price will be equal to 100 % of the principal amount of the 2029 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of June 30, 2024.

As of June 30, 2024, the if-converted value of the 2029 Convertible Notes did not exceed the principal amount.

Note Repurchases

In December 2022, the Company repurchased approximately $ 109.4 million aggregate principal amount of 2.875 % Convertible Senior Notes Due 2024 for approximately $ 117.5 million plus accrued interest and approximately $ 69.1 million aggregate principal amount of 2.375 % Convertible Senior Notes Due 2025 for approximately $ 62.9 million plus accrued interest and recognized a $ 3.5 million loss on extinguishment of debt recorded to “Interest expense” in the Company’s condensed consolidated statement of operations for the three months ended December 31, 2022.

2.375 % 2025 Convertible Senior Notes Due 2025

In May 2018, we issued $ 172.5 million aggregate principal amount of 2.375 % Convertible Senior Notes Due 2025 (the “2025 Convertible Notes”), for which $ 103.4 million remains outstanding as of June 30, 2024.

As of December 31, 2024, the 2029 Convertible Notes were not convertible as no conditions of conversion had been met.

Accordingly, the net balance of the 2029 Convertible Notes was classified as a non-current liability in our condensed consolidated balance sheets as of December 31, 2024.

The classification of the 2029 Convertible Notes as current or non-current in the condensed consolidated balance sheets is evaluated at each balance sheet date and may change from time to time depending on whether any of the conversion conditions has been met.

If one of the conversion conditions is met in any future fiscal quarter, we will classify our net liability under the 2029 Convertible Notes as a current liability in the condensed consolidated balance sheets as of the end of that fiscal quarter.

If none of the conversion conditions have been met in a future fiscal quarter prior to the one-year period immediately preceding the 2029 Maturity Date, we will classify our net liability under the 2029 Convertible Notes as a non-current liability in the condensed consolidated balance sheets as of the end of that fiscal quarter.

If the note holders elect to convert their 2029 Convertible Notes prior to maturity, any unamortized debt issuance costs will be recognized as expense at the time of conversion.

If the entire outstanding principal amount had been converted on December 31, 2024, we would have recorded an expense associated with the conversion, comprised of $ 5.5 million of unamortized debt issuance costs.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of December 31, 2024.

As of December 31, 2024, the if-converted value of the 2029 Convertible Notes did not exceed the principal amount.

2025 Convertible Notes

In May 2018, we issued $ 172.5 million aggregate principal amount of the 2025 Convertible Notes.

The 2025 Convertible Notes were issued pursuant to an indenture dated May 14, 2018 (the “2018 Indenture”) by and between the Company and Wells Fargo Bank, National Association, as the original trustee.

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The 2025 Convertible Notes were issued in a private offering under Rule 144A under the Securities Act of 1933.

In December 2022, we repurchased approximately $ 69.1 million aggregate principal amount of the 2025 Convertible Notes for approximately $ 62.9 million plus accrued interest.

As of December 31, 2024, $ 103.4 million remains outstanding.

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 effective interest rate for the three and nine months ended June 30, 2024 was approximately 2.88 % for the 2025 Convertible Notes.

As of June 30, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2025 Maturity Date assuming no early conversion.

The effective interest rate for the three months ended December 31, 2024 was approximately 2.88 % for the 2025 Convertible Notes.

As of December 31, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2025 Maturity Date assuming no early conversion.

The 2025 Convertible Notes are convertible based on an initial conversion rate of 62.8931 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $ 15.90 per share).

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The 2025 Convertible Notes contain certain make-whole fundamental change premiums and customary anti-dilution adjustments.

Upon conversion, we may settle in cash, shares of Class A Common Stock or any combination thereof, at our election.

Prior to November 1, 2024, the 2025 Convertible Notes are convertible only under the following circumstances:

(1) during any fiscal quarter commencing after the fiscal quarter ended on June 30, 2018 (and only during such fiscal quarter), if the last reported sale price of our Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130 % of the conversion price on each applicable trading day;

(2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price, as defined in the 2018 Indenture, per $1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of our Class A Common Stock and the conversion rate on such trading day;

(3) if we call any or all of the 2025 Convertible Notes for redemption, at any time prior to the close of business on the business day immediately preceding the redemption date;

or (4) upon the occurrence of specified corporate events, as defined in the 2018 Indenture.

On or after November 1, 2024 until the close of business on the business day immediately preceding the 2025 Maturity Date, holders of 2025 Convertible Notes may, at their option, convert their 2025 Convertible Notes at any time, regardless of the foregoing circumstances.

At our option, we may redeem for cash all or any portion of the 2025 Convertible Notes if the last reported sale price of the Class A Common Stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which we provide notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption.

The redemption price will be equal to 100 % of the principal amount of the 2025 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of June 30, 2024.

As of June 30, 2024, the if-converted value of the 2025 Convertible Notes did not exceed the principal amount.

2.875 % Convertible Senior Notes Due 2024

In July 2017, we issued $ 143.75 million aggregate principal amount of 2.875 % Convertible Senior Notes Due 2024 (the “2024 Convertible Notes”), of which $ 34.4 million remains outstanding as of June 30, 2024.

Until the close of business on the business day immediately preceding the 2025 Maturity Date, holders of 2025 Convertible Notes may, at their option, convert their 2025 Convertible Notes at any time.

Pursuant to the terms of the 2018 Indenture, we have elected to settle any conversions of the 2025 Convertible Notes using shares of Class A Common Stock (physical settlement).

On October 28, 2024, we provided notice of that election to the trustee.

If the note holders elect to convert their 2025 Convertible Notes prior to maturity, any unamortized debt issuance costs will be recognized as expense at the time of conversion.

If the entire outstanding principal amount had been converted on December 31, 2024, we would have recorded an expense associated with the conversion, comprised of $ 0.2 million of unamortized debt issuance costs.

The stock trading price condition and other triggers are measured on a quarter-by-quarter basis and were not met as of December 31, 2024.

As of December 31, 2024, the if-converted value of the 2025 Convertible Notes did not exceed the principal amount and none of the note holders had elected to convert their 2025 Convertible Notes.

2024 Convertible Notes

In July 2017, we issued $ 143.75 million aggregate principal amount of the 2024 Convertible Notes.

The 2024 Convertible Notes were issued pursuant to an indenture dated July 5, 2017 (the “2017 Indenture”) by and between the Company and Wells Fargo Bank, National Association, as the original trustee.

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The 2024 Convertible Notes were issued in a private offering under Rule 144A under the Securities Act of 1933.

The 2024 Convertible Notes pay interest semi-annually in arrears at a rate of 2.875 % per annum on January 1 and July 1 of each year, commencing January 1, 2018, and mature on July 1, 2024 (the “2024 Maturity Date”), unless converted, redeemed or repurchased in accordance with the terms prior to such date.

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 effective interest rate for the three and nine months ended June 30, 2024 was approximately 3.35 %.

As of June 30, 2024, the remaining unamortized debt issuance costs will be amortized using the effective interest method through the 2024 Maturity Date assuming no early conversion.

The 2024 Convertible Notes are convertible based on an initial conversion rate of 100 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $ 10.00 per share).

The conversion rate will not be adjusted for any accrued and unpaid interest.

The 2024 Convertible Notes contain certain make-whole fundamental change premiums and customary anti-dilution adjustments.

Until the close of business on the business day immediately preceding the 2024 Maturity Date, holders of 2024 Convertible Notes may, at their option, convert their 2024 Convertible Notes at any time.

Because we did not elect an alternative settlement method prior to January 1, 2024, conversions will be settled by combination settlement, which is $1,000 cash (per the $1,000 principal value) plus stock equal to the accreted value as defined in the 2017 Indenture.

As of June 30, 2024, based on the terms of the 2017 Indenture, the if-converted value of the 2024 Convertible Notes exceeded the principal amount by $ 0.8 million, or approximately 77,000 Class A common shares.

Prior to the 2024 Maturity Date, certain holders of the 2024 Convertible Notes elected to convert their 2024 Convertible Notes, resulting in combination settlement on the 2024 Maturity Date.

In December 2022, we repurchased approximately $ 109.4 million aggregate principal amount of the 2024 Convertible Notes for approximately $ 117.5 million plus accrued interest.

On July 1, 2024, the $ 34.4 million aggregate principal amount outstanding plus accrued interest was repaid using cash on hand and 77,328 Class A Common Stock shares, equal to the accreted value, were issued as part of the 2024 Convertible Notes conversion.

The 2024 Convertible Notes paid interest semi-annually in arrears at a rate of 2.875 % per annum on January 1 and July 1 of each year, commencing January 1, 2018, and matured on July 1, 2024 (the “2024 Maturity Date”).

The 2024 Convertible Notes were convertible based on an initial conversion rate of 100 shares of Class A Common Stock per $1,000 principal amount (equivalent to an initial conversion price of $ 10.00 per share).

Until the close of business on the business day immediately preceding the 2024 Maturity Date, holders of 2024 Convertible Notes could, at their option, convert their 2024 Convertible Notes at any time.

Because we did not elect an alternative settlement method prior to January 1, 2024, conversions were settled by combination settlement, which was $1,000 cash (per the $1,000 principal value) plus stock equal to the accreted value as defined in the 2017 Indenture.

COMMON STOCK AND STOCK COMPENSATION

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The Board of Directors has reserved the right to modify, suspend or terminate the program at any time.

As of June 30, 2024, we had repurchased and retired 2,572,794 shares of our Class A Common Stock for $ 23.0 million under the Common Stock Repurchase Program, of which 285,392 and 945,749 shares were repurchased and retired for $ 3.0 million and $ 9.0 million during the three and nine months ended June 30, 2024, respectively.

During the three and nine months ended June 30, 2023, 346,310 and 1,037,703 shares were repurchased and retired for $ 3.0 million and $ 9.0 million, respectively, under the Common Stock Repurchase Program.

The repurchase amount is allocated between “Additional paid-in capital” and “Retained earnings” in our condensed consolidated balance sheets.

Other Common Stock Repurchases

During December 2022, the Company used approximately $ 5.0 million of the net proceeds from the 2029 Convertible Notes offering to repurchase for cash 578,703 shares of its Class A common stock from purchasers of the notes in privately negotiated transactions.

Such transactions were authorized separately from, and not considered a part of, the publicly announced share repurchase program discussed above.

As of December 31, 2024, we had repurchased and retired 3,096,011 shares of our Class A Common Stock for $ 29.0 million under the Common Stock Repurchase Program, of which 250,463 shares were repurchased and retired for $ 3.0 million during the three months ended December 31, 2024.

During the three months ended December 31, 2023, 354,882 shares were repurchased and retired for $ 3.0 million under the Common Stock Repurchase Program.

The repurchase amount is allocated between “Additional paid-in capital” and “Retained earnings” in our condensed consolidated balance sheets.

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( 1,055,736 ) 7.39

Cancelled ( 63,211 ) 7.32

Outstanding as of June 30, 2024

Outstanding as of December 31, 2024

2,782,470 $ 9.02

1 unchanged sentence

(b) 337,421 shares were withheld to satisfy related income tax withholding.

CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

Currently, and from time to time, we are involved in various claims, disputes, lawsuits, investigations, and legal and regulatory proceedings.

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• Latin America Pawn — all pawn activities in Mexico and other parts of Latin America;

• Other Investments — primarily our equity interest in the net income of Cash Converters along with our investment in RDC and our investment in and notes receivable from Founders.

• Other Investments — primarily our equity interest in Cash Converters and our investment in and notes receivable from Founders.

There are no inter-segment revenues presented below, and the amounts below were determined in accordance with the same accounting principles used in our condensed consolidated financial statements.

The following income (loss) before income taxes tables present revenue for each reportable segment, disaggregated revenue within our reportable segments and Corporate, segment profits and segment contribution.

Three Months Ended June 30, 2024

The following income (loss) before income taxes tables present revenues for each reportable segment, disaggregated revenues within our reportable segments and Corporate, segment profits and segment contribution.

Three Months Ended December 31, 2024

(in thousands) U.S.

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Depreciation and amortization 2,717 2,046 — 4,763 3,572 8,335

(Gain) loss on sale or disposal of assets and other ( 2 ) 22 — 20 — 20

Loss on sale or disposal of assets and other — 8 — 8 — 8

Interest expense — — — — 3,147 3,147

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Income (loss) before income taxes $ 66,683 $ ( 25,299 ) $ 41,384

Three Months Ended June 30, 2023

Three Months Ended December 31, 2023

(in thousands) U.S.

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Depreciation and amortization 2,624 2,339 — 4,963 3,602 8,565

Gain on sale or disposal of assets — ( 29 ) — ( 29 ) — ( 29 )

Other income — ( 2,632 ) — ( 2,632 ) — ( 2,632 )

Loss (gain) on sale or disposal of assets and other 26 ( 196 ) — ( 170 ) ( 2 ) ( 172 )

Interest expense — — — — 3,440 3,440

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Income (loss) before income taxes $ 59,418 $ ( 21,713 ) $ 37,705

Nine Months Ended June 30, 2024

(in thousands) U.S.

Pawn Latin America Pawn Other Investments Total Segments Corporate Items Consolidated

Merchandise sales $ 348,211 $ 154,019 $ — $ 502,230 $ — $ 502,230

Jewelry scrapping sales 39,258 3,933 — 43,191 — 43,191

Pawn service charges 236,499 84,943 — 321,442 — 321,442

Other revenues 94 59 35 188 — 188

Total revenues 624,062 242,954 35 867,051 — 867,051

Merchandise cost of goods sold 218,736 103,944 — 322,680 — 322,680

Jewelry scrapping cost of goods sold 33,965 3,514 — 37,479 — 37,479

Gross profit 371,361 135,496 35 506,892 — 506,892

Segment and corporate expenses (income):

Store expenses 239,536 101,936 — 341,472 — 341,472

General and administrative — — — — 54,869 54,869

Depreciation and amortization 7,548 6,821 — 14,369 10,573 24,942

(Gain) loss on sale or disposal of assets and other ( 6 ) ( 240 ) — ( 246 ) 97 ( 149 )

Other income — — — — ( 765 ) ( 765 )

Interest expense — — — — 10,381 10,381

Interest income — ( 1,398 ) ( 1,811 ) ( 3,209 ) ( 5,243 ) ( 8,452 )

Equity in net (income) loss of unconsolidated affiliates — — ( 4,278 ) ( 4,278 ) 143 ( 4,135 )

Other (income) expense — ( 231 ) 27 ( 204 ) ( 423 ) ( 627 )

Segment contribution $ 124,283 $ 28,608 $ 6,097 $ 158,988

Income (loss) before income taxes $ 158,988 $ ( 69,632 ) $ 89,356

Nine Months Ended June 30, 2023

(in thousands) U.S.

Pawn Latin America Pawn Other Investments Total Segments Corporate Items Consolidated

Merchandise sales $ 329,231 $ 135,043 $ — $ 464,274 $ — $ 464,274

Jewelry scrapping sales 30,088 4,552 — 34,640 — 34,640

Pawn service charges 208,045 71,397 — 279,442 — 279,442

Other revenues 84 75 47 206 — 206

Total revenues 567,448 211,067 47 778,562 — 778,562

Merchandise cost of goods sold 203,698 93,587 — 297,285 — 297,285

Jewelry scrapping cost of goods sold 25,867 4,946 — 30,813 — 30,813

Gross profit 337,883 112,534 47 450,464 — 450,464

Segment and corporate expenses (income):

Store expenses 220,639 86,365 — 307,004 — 307,004

General and administrative — ( 3 ) — ( 3 ) 48,964 48,961

Depreciation and amortization 7,820 6,850 — 14,670 9,307 23,977

Loss (gain) on sale or disposal of assets 84 ( 56 ) — 28 — 28

Other income — ( 5,097 ) — ( 5,097 ) — ( 5,097 )

Interest expense — — — — 12,994 12,994

Interest income ( 2 ) ( 723 ) — ( 725 ) ( 4,421 ) ( 5,146 )

Equity in net loss of unconsolidated affiliates — — 29,394 29,394 — 29,394

Other (income) expense — ( 41 ) 20 ( 21 ) ( 138 ) ( 159 )

Segment contribution (loss) $ 109,342 $ 25,239 $ ( 29,367 ) $ 105,214

Income (loss) before income taxes $ 105,214 $ ( 66,706 ) $ 38,508

The following table presents separately identified segment assets:

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Pawn Latin America Pawn Other

Investments (a)

Corporate Items Total

As of June 30, 2024

As of December 31, 2024

Pawn loans $ 220,208 $ 54,616 $ — $ — $ 274,824

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Total assets 1,029,206 305,337 80,242 84,348 1,499,133

As of June 30, 2023

As of December 31, 2023

Pawn loans $ 190,766 $ 52,486 $ — $ — $ 243,252

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Total assets 1,009,226 311,824 79,421 92,766 1,493,237

(a) Segment assets as of September 30, 2023 have been recast to conform to current year presentation as CCV no longer meets the 10 percent threshold to be considered its own segment.

SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION

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

(in thousands) June 30, 2024 June 30, 2023 September 30, 2023

(in thousands) December 31, 2024 December 31, 2023 September 30, 2024

Gross pawn service charges receivable $ 57,359 $ 50,919 $ 57,544

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Prepaid expenses and other $ 4,218 $ 6,868 $ 3,350

Accounts receivable, notes receivable and other 30,845 29,860 30,548

Accounts receivable and other 13,945 15,699 16,482

Notes receivable 16,924 18,333 16,332

Income taxes prepaid and receivable 1,475 3,101 3,007

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The following table provides supplemental disclosure of condensed consolidated statements of cash flows information:

Nine Months Ended

Three Months Ended

(in thousands) 2024 2023

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Pawn loans forfeited and transferred to inventory $ 109,219 $ 96,472

Transfer of equity consideration for acquisition — 99

Acquisition earn-out contingency — 2,000

Accrued acquisition consideration — 37

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