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Strategic Investments | 9 Months Ended
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Jun. 30, 2013
Equity Method Investments and Joint Ventures [Abstract] |
STRATEGIC INVESTMENTS | NOTE 5: STRATEGIC INVESTMENTS At June 30, 2013, we owned 16,644,640 ordinary shares of Albemarle & Bond Holdings, PLC ("Albemarle & Bond"), representing almost 30% of its total outstanding shares. Our total cost for those shares was approximately $27.6 million. Albemarle & Bond is primarily engaged in pawnbroking, retail jewelry sales, check cashing and lending in the United Kingdom. We account for the investment using the equity method. Since Albemarle & Bond’s fiscal year ends three months prior to ours, we report the income from this investment on a three-month lag. Albemarle & Bond files semi-annual financial reports for its fiscal periods ending December 31 and June 30. Due to the three-month lag, income reported for our nine-month periods ended June 30, 2013 and 2012 represents our percentage interest in the results of Albemarle & Bond’s operations from July 1, 2012 to March 31, 2013 and July 1, 2011 to March 31, 2012, respectively. Conversion of Albemarle & Bond’s financial statements into U.S. GAAP resulted in no material differences from those reported by Albemarle & Bond following IFRS. In its functional currency of British pounds, Albemarle & Bond’s total assets increased 13% from December 31, 2011 to December 31, 2012 and its net income decreased 31% for the six months ended December 31, 2012. The following table presents summary financial information for Albemarle & Bond’s most recently reported results after translation to U.S. dollars (using the exchange rate as of December 31 of each year for balance sheet items and average exchange rates for the income statement items for the periods indicated):
| As of December 31,
| 2012 |  | 2011
| (in thousands)
Current assets | $ | 162,078 |  |  | $ | 134,387 |
Non-current assets | 74,711 |  |  | 65,354 |
Total assets | $ | 236,789 |  |  | $ | 199,741 |
Current liabilities | $ | 22,267 |  |  | $ | 21,021 |
Non-current liabilities | 83,332 |  |  | 62,169 |
Shareholders’ equity | 131,190 |  |  | 116,551 |
Total liabilities and shareholders’ equity | $ | 236,789 |  |  | $ | 199,741 |
| Six Months Ended December 31,
| 2012 |  | 2011
| (in thousands)
Gross revenues | $ | 93,793 |  |  | $ | 99,804 |
Gross profit | 53,612 |  |  | 58,165 |
Profit for the year (net income) | 9,796 |  |  | 14,208 |
At June 30, 2013, we owned 136,848,000 shares, or approximately 33%, of Cash Converters International Limited ("Cash Converters International"), a publicly traded company headquartered in Perth, Australia. Cash Converters International franchises and operates a worldwide network of over 700 specialty financial services and retail stores that provide pawn loans, short-term unsecured loans and other consumer finance products, and buy and sell second-hand goods, with significant store concentrations in Australia and the United Kingdom. Those shares include 12,430,000 shares that we acquired in November 2012 for approximately $11.0 million in cash as part of a share placement. Our total investment in Cash Converters International was acquired between November 2009 and November 2012 for approximately $68.8 million. We account for our investment in Cash Converters International using the equity method. Since Cash Converters International’s fiscal year ends three months prior to ours, we report the income from this investment on a three-month lag. Cash Converters International files semi-annual financial reports for its fiscal periods ending December 31 and June 30. Due to the three-month lag, income reported for our nine-month periods ended June 30, 2013 and 2012 represents our percentage interest in the results of Cash Converters International’s operations from July 1, 2012 to March 31, 2013 and July 1, 2011 to March 31, 2012, respectively. Conversion of Cash Converters International’s financial statements into U.S. GAAP resulted in no material differences from those reported by Cash Converters following IFRS. In its functional currency of Australian dollars, Cash Converters International’s total assets increased 22% from December 31, 2011 to December 31, 2012 and its net income improved 39% for the six months ended December 31, 2012. The following table presents summary financial information for Cash Converters International’s most recently reported results after translation to U.S. dollars (using the exchange rate as of December 31 of each year for balance sheet items and average exchange rates for the income statement items for the periods indicated):
| As of December 31,
| 2012 |  | 2011
| (in thousands)
Current assets | $ | 169,739 |  |  | $ | 128,289 |
Non-current assets | 141,258 |  |  | 121,835 |
Total assets | $ | 310,997 |  |  | $ | 250,124 |
Current liabilities | $ | 38,735 |  |  | $ | 33,290 |
Non-current liabilities | 31,591 |  |  | 37,797 |
Shareholders’ equity | 240,671 |  |  | 179,037 |
Total liabilities and shareholders’ equity | $ | 310,997 |  |  | $ | 250,124 |
| Six Months Ended December 31,
| 2012 |  | 2011
| (in thousands)
Gross revenues | $ | 140,123 |  |  | $ | 115,256 |
Gross profit | 95,149 |  |  | 76,405 |
Profit for the year (net income) | 19,143 |  |  | 13,668 |
The table below summarizes the recorded value and fair value of each of these strategic investments at the dates indicated. These fair values are considered Level 1 estimates within the fair value hierarchy of FASB ASC 820-10-50, and were calculated as (a) the quoted stock price on each company’s principal market multiplied by (b) the number of shares we owned multiplied by (c) the applicable foreign currency exchange rate at the dates indicated.
| June 30, |  | September 30,
| 2013 |  | 2012 |  | 2012
| (in thousands of U.S. dollars)
Albemarle & Bond: |  |  |  |  |
Recorded value | $ | 52,252 |  |  | $ | 51,156 |  |  | $ | 51,812 |
Fair value | 33,920 |  |  | 63,677 |  |  | 65,109 |
Cash Converters International: |  |  |  |  |
Recorded value | $ | 94,455 |  |  | $ | 74,153 |  |  | $ | 74,254 |
Fair value | 133,732 |  |  | 80,894 |  |  | 100,705 |
On April 19, 2013, Albemarle & Bond announced that it expected profits for their full fiscal year (ending June 30, 2013) to be materially below market expectations, citing reduction in gold buying profit and pressures on its pawn loan business due to the challenging gold environment and increased competition. In addition Albemarle & Bond's Board of Directors announced that their CEO would step down earlier than planned and their former CEO and non-executive Chairman would assume the CEO role until a permanent replacement is found. At June 30, 2013, the fair value of our investment in Albemarle & Bond Holdings, PLC was less than our recorded value. We currently believe that the fair value decline is temporary due to the recent global gold environment challenges and the absence of a permanent CEO.

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6382943&loc=d3e33918-111571 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=7658923&loc=d3e32847-111569 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=7658923&loc=d3e32787-111569 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Principles Board Opinion (APB) -Number 18 -Paragraph 20 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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