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Restatement of Condensed Consolidated Financial Statements (Tables) | 3 Months Ended
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Dec. 31, 2014
Accounting Changes and Error Corrections [Abstract] |
Schedule of Effects of the Restatement on Previously Issued Condensed Consolidated Financial Statements | The following table summarizes the impact of the restatement adjustments for the first quarter of fiscal 2015 (ended December 31, 2014):
| Quarter Ended December 31, 2014
| (in thousands)
Income from continuing operations before income taxes (as previously reported) | $ | 20,435 |
Asset sale impact | (1,772 | )
Portfolio review impact | (8,039 | )
Other impacts | 1,589 |
Net impact of adjustments | (8,222 | )
Income from continuing operations before income taxes (as restated) | $ | 12,213 |
The effects of the restatement on our unaudited condensed consolidated financial statements as of and for the quarter ended December 31, 2014 are set forth below.
EZCORP, Inc. CONDENSED CONSOLIDATED BALANCE SHEET (in thousands, except share amounts)
| December 31, 2014
| (Unaudited)
| As Previously Reported |  | Restatement Adjustments |  | As Restated
Assets: |  |  |  |  |
Current assets: |  |  |  |  |
Cash and cash equivalents | $ | 77,599 |  |  | $ | — |  |  | $ | 77,599 |
Restricted cash | 60,218 |  |  | — |  |  | 60,218 |
Pawn loans | 150,930 |  |  | — |  |  | 150,930 |
Consumer loans, net | 62,380 |  |  | (1,033 | ) |  | 61,347 |
Pawn service charges receivable, net | 30,241 |  |  | — |  |  | 30,241 |
Consumer loan fees and interest receivable, net | 28,355 |  |  | (15,156 | ) |  | 13,199 |
Inventory, net | 133,986 |  |  | (1,327 | ) |  | 132,659 |
Deferred tax asset | 20,858 |  |  | (3,286 | ) |  | 17,572 |
Prepaid income taxes | 23,790 |  |  | 29,033 |  |  | 52,823 |
Receivables, prepaid expenses and other current assets | 34,195 |  |  | (120 | ) |  | 34,075 |
Total current assets | 622,552 |  |  | 8,111 |  |  | 630,663 |
Investments in unconsolidated affiliates | 99,219 |  |  | — |  |  | 99,219 |
Property and equipment, net | 104,353 |  |  | — |  |  | 104,353 |
Restricted cash, non-current | 3,454 |  |  | 856 |  |  | 4,310 |
Goodwill | 337,498 |  |  | — |  |  | 337,498 |
Intangible assets, net | 60,739 |  |  | 1,338 |  |  | 62,077 |
Non-current consumer loans, net | 36,449 |  |  | 41,913 |  |  | 78,362 |
Deferred tax asset | 11,630 |  |  | (1,013 | ) |  | 10,617 |
Other assets, net | 75,489 |  |  | 1,863 |  |  | 77,352 |
Total assets | $ | 1,351,383 |  |  | $ | 53,068 |  |  | $ | 1,404,451 |
Liabilities and stockholders’ equity: |  |  |  |  |
Current liabilities: |  |  |  |  |
Current maturities of long-term debt | $ | 24,789 |  |  | $ | 50,043 |  |  | $ | 74,832 |
Current capital lease obligations | 258 |  |  | — |  |  | 258 |
Accounts payable and other accrued expenses | 80,314 |  |  | 1,103 |  |  | 81,417 |
Other current liabilities | 6,000 |  |  | — |  |  | 6,000 |
Customer layaway deposits | 5,133 |  |  | — |  |  | 5,133 |
Total current liabilities | 116,494 |  |  | 51,146 |  |  | 167,640 |
Long-term debt, less current maturities | 324,029 |  |  | 63,125 |  |  | 387,154 |
Long-term capital lease obligations | — |  |  | — |  |  | — |
Deferred gains and other long-term liabilities | 10,803 |  |  | (2,357 | ) |  | 8,446 |
Total liabilities | 451,326 |  |  | 111,914 |  |  | 563,240 |
Commitments and contingencies |  |  |  |  |  |  |  |
Temporary equity: |  |  |  |  |
Redeemable noncontrolling interest | 31,868 |  |  | (13,318 | ) |  | 18,550 |
Stockholders’ equity: |  |  |  |  |
Class A Non-voting Common Stock, par value $.01 per share; shares authorized: 100 million as of December 31, 2014; issued and outstanding: 50,680,358 as of December 31, 2014 | 506 |  |  | — |  |  | 506 |
Class B Voting Common Stock, convertible, par value $.01 per share; 3 million shares authorized; issued and outstanding: 2,970,171 | 30 |  |  | — |  |  | 30 |
Additional paid-in capital | 338,667 |  |  | (9,224 | ) |  | 329,443 |
Retained earnings | 562,437 |  |  | (41,239 | ) |  | 521,198 |
Accumulated other comprehensive loss | (33,451 | ) |  | 4,935 |  |  | (28,516 | )
EZCORP, Inc. stockholders’ equity | 868,189 |  |  | (45,528 | ) |  | 822,661 |
Total liabilities and stockholders’ equity | $ | 1,351,383 |  |  | $ | 53,068 |  |  | $ | 1,404,451 |
EZCORP, Inc. CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
| Three Months Ended December 31, 2014
| (Unaudited)
| (in thousands, except per share amounts)
| As Previously Reported |  | Restatement Adjustments |  | As Restated
Revenues: |  |  |  |  |
Merchandise sales | $ | 109,639 |  |  | $ | — |  |  | $ | 109,639 |
Jewelry scrapping sales | 18,534 |  |  | — |  |  | 18,534 |
Pawn service charges | 64,927 |  |  | — |  |  | 64,927 |
Consumer loan fees and interest | 52,232 |  |  | 6,615 |  |  | 58,847 |
Other revenues | 7,312 |  |  | (6,441 | ) |  | 871 |
Total revenues | 252,644 |  |  | 174 |  |  | 252,818 |
Merchandise cost of goods sold | 72,388 |  |  | 90 |  |  | 72,478 |
Jewelry scrapping cost of goods sold | 14,675 |  |  | — |  |  | 14,675 |
Consumer loan bad debt | 15,251 |  |  | 6,799 |  |  | 22,050 |
Net revenues | 150,330 |  |  | (6,715 | ) |  | 143,615 |
Operating expenses: |  |  |  |  |
Operations | 103,656 |  |  | 38 |  |  | 103,694 |
Administrative | 10,174 |  |  | (1,822 | ) |  | 8,352 |
Depreciation | 7,573 |  |  | — |  |  | 7,573 |
Amortization | 1,457 |  |  | — |  |  | 1,457 |
Loss on sale or disposal of assets | 259 |  |  | — |  |  | 259 |
Total operating expenses | 123,119 |  |  | (1,784 | ) |  | 121,335 |
Operating income | 27,211 |  |  | (4,931 | ) |  | 22,280 |
Interest expense | 8,958 |  |  | 3,076 |  |  | 12,034 |
Interest income | (525 | ) |  | (7 | ) |  | (532 | )
Equity in net income of unconsolidated affiliates | (2,194 | ) |  | — |  |  | (2,194 | )
Other expense | 537 |  |  | 222 |  |  | 759 |
Income from continuing operations before income taxes | 20,435 |  |  | (8,222 | ) |  | 12,213 |
Income tax expense | 6,365 |  |  | (2,787 | ) |  | 3,578 |
Income from continuing operations, net of tax | 14,070 |  |  | (5,435 | ) |  | 8,635 |
Income from discontinued operations, net of tax | 1,043 |  |  | — |  |  | 1,043 |
Net income | 15,113 |  |  | (5,435 | ) |  | 9,678 |
Net loss from continuing operations attributable to redeemable noncontrolling interest | (147 | ) |  | (1,787 | ) |  | (1,934 | )
Net income attributable to EZCORP, Inc. | $ | 15,260 |  |  | $ | (3,648 | ) |  | $ | 11,612 |
Basic earnings per share attributable to EZCORP, Inc.: |  |  |  |  |
Continuing operations | $ | 0.26 |  |  | $ | (0.06 | ) |  | $ | 0.20 |
Discontinued operations | 0.02 |  |  | — |  |  | 0.02 |
Basic earnings per share | $ | 0.28 |  |  | $ | (0.06 | ) |  | $ | 0.22 |
Diluted earnings per share attributable to EZCORP, Inc.: |  |  |  |  |
Continuing operations | $ | 0.26 |  |  | $ | (0.06 | ) |  | $ | 0.20 |
Discontinued operations | 0.02 |  |  | — |  |  | 0.02 |
Diluted earnings per share | $ | 0.28 |  |  | $ | (0.06 | ) |  | $ | 0.22 |
Net income from continuing operations attributable to EZCORP, Inc. | $ | 14,217 |  |  | $ | (3,648 | ) |  | $ | 10,569 |
Income from discontinued operations attributable to EZCORP, Inc. | 1,043 |  |  | — |  |  | 1,043 |
Net income attributable to EZCORP, Inc. | $ | 15,260 |  |  | $ | (3,648 | ) |  | $ | 11,612 |
EZCORP, Inc. CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE (LOSS) INCOME
| Three Months Ended December 31, 2014
| (Unaudited)
| (in thousands)
| As Previously Reported |  | Restatement Adjustments |  | As Restated
Net income | $ | 15,113 |  |  | $ | (5,435 | ) |  | $ | 9,678 |
Other comprehensive loss: |  |  |  |  |
Foreign currency translation loss | (27,145 | ) |  | 5,624 |  |  | (21,521 | )
Cash flow hedges: |  |  | — |  |  |
Amounts reclassified from accumulated other comprehensive loss | 352 |  |  | — |  |  | 352 |
Income tax benefit | 2,050 |  |  | (1,631 | ) |  | 419 |
Other comprehensive loss, net of tax | (24,743 | ) |  | 3,993 |  |  | (20,750 | )
Comprehensive loss | $ | (9,630 | ) |  | $ | (1,442 | ) |  | $ | (11,072 | )
Attributable to redeemable noncontrolling interest: |  |  |  |  |
Net loss | (147 | ) |  | (1,787 | ) |  | (1,934 | )
Foreign currency translation loss | (3,569 | ) |  | 1,167 |  |  | (2,402 | )
Amounts reclassified from accumulated other comprehensive loss | 86 |  |  | — |  |  | 86 |
Comprehensive loss attributable to redeemable noncontrolling interest | (3,630 | ) |  | (620 | ) |  | (4,250 | )
Comprehensive loss attributable to EZCORP, Inc. | $ | (6,000 | ) |  | $ | (822 | ) |  | $ | (6,822 | )
EZCORP, Inc. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
| Three Months Ended December 31, 2014
| (Unaudited)
| (in thousands)
| As Previously Reported |  | Restatement Adjustments |  | As Restated
Operating activities: |  |  |  |  |
Net income | $ | 15,113 |  |  | $ | (5,435 | ) |  | $ | 9,678 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |
Depreciation and amortization | 9,030 |  |  | — |  |  | 9,030 |
Amortization of debt discount and consumer loan premium | 1,982 |  |  | — |  |  | 1,982 |
Consumer loan loss provision | 6,241 |  |  | 1,349 |  |  | 7,590 |
Deferred income taxes | 1,497 |  |  | 1 |  |  | 1,498 |
Amortization of deferred financing costs | 1,633 |  |  | — |  |  | 1,633 |
Amortization of prepaid commissions | 2,967 |  |  | 46 |  |  | 3,013 |
Other adjustments | (176 | ) |  | — |  |  | (176 | )
Loss on sale or disposal of assets | 324 |  |  | — |  |  | 324 |
Gain on sale of loan portfolio | (6,576 | ) |  | 6,576 |  |  | — |
Stock compensation benefit | (636 | ) |  | (1,822 | ) |  | (2,458 | )
Income from investments in unconsolidated affiliates | (2,194 | ) |  | — |  |  | (2,194 | )
Tax provision from stock compensation | 167 |  |  | (167 | ) |  | — |
Changes in operating assets and liabilities, net of business acquisitions: |  |  |  |  |
Service charges and fees receivable | (806 | ) |  | (2,555 | ) |  | (3,361 | )
Inventory | 421 |  |  | 88 |  |  | 509 |
Receivables. prepaid expenses, other current assets and other assets | (7,926 | ) |  | 102 |  |  | (7,824 | )
Accounts payable and other accrued expenses and deferred gains and other long-term liabilities | (10,911 | ) |  | (3,044 | ) |  | (13,955 | )
Customer layaway deposits | (2,895 | ) |  | — |  |  | (2,895 | )
Deferred gains and other long-term liabilities | (278 | ) |  | 278 |  |  | — |
Change in restricted cash | (933 | ) |  | — |  |  | (933 | )
Prepaid income taxes | 4,769 |  |  | (670 | ) |  | 4,099 |
Payments of restructuring charges | (2,285 | ) |  | — |  |  | (2,285 | )
Dividends from unconsolidated affiliates | 2,407 |  |  | — |  |  | 2,407 |
Net cash provided by operating activities | 10,935 |  |  | (5,253 | ) |  | 5,682 |
Investing activities: |  |  |  |  |
Loans made | (223,748 | ) |  | — |  |  | (223,748 | )
Loans repaid | 147,981 |  |  | 18,790 |  |  | 166,771 |
Recovery of pawn loan principal through sale of forfeited collateral | 69,886 |  |  | — |  |  | 69,886 |
Additions to property and equipment | (8,954 | ) |  | — |  |  | (8,954 | )
Investments in unconsolidated affiliates | (12,140 | ) |  | — |  |  | (12,140 | )
Proceeds from sale of assets | 65,849 |  |  | (65,849 | ) |  | — |
Net cash (used in) provided by investing activities | 38,874 |  |  | (47,059 | ) |  | (8,185 | )
EZCORP, Inc. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Financing activities: |  |  |  |  |
Tax deficiency of stock compensation | (167 | ) |  | 167 |  |  | — |
Taxes paid related to net share settlement of equity awards | (196 | ) |  | — |  |  | (196 | )
Payout of deferred and contingent consideration | (6,000 | ) |  | — |  |  | (6,000 | )
Proceeds from settlement of forward currency contracts | 2,313 |  |  | — |  |  | 2,313 |
Change in restricted cash | (1,840 | ) |  | 1,045 |  |  | (795 | )
Proceeds from bank borrowings | 3,609 |  |  | 62,951 |  |  | 66,560 |
Payments on bank borrowings and capital lease obligations | (23,805 | ) |  | (10,845 | ) |  | (34,650 | )
Net cash provided by (used in) financing activities | (26,086 | ) |  | 53,318 |  |  | 27,232 |
Effect of exchange rate changes on cash and cash equivalents | (2,453 | ) |  | (2 | ) |  | (2,455 | )
Net increase in cash and cash equivalents | 21,270 |  |  | 1,004 |  |  | 22,274 |
Cash and cash equivalents at beginning of period | 56,329 |  |  | (1,004 | ) |  | 55,325 |
Cash and cash equivalents at end of period | $ | 77,599 |  |  | $ | — |  |  | $ | 77,599 |
Non-cash investing and financing activities: |  |  |  |  |
Pawn loans forfeited and transferred to inventory | $ | 66,699 |  |  | $ | — |  |  | $ | 66,699 |
EZCORP, Inc. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
| Common Stock |  | Additional Paid-in Capital |  | Retained Earnings |  | Accumulated Other Comprehensive (Loss) Income |  | EZCORP, Inc. Stockholders’ Equity
| Shares |  | Par Value |
| (Unaudited, except balances as of September 30, 2014)
| (in thousands)
| As Previously Reported
Balances as of September 30, 2014 | 53,585 |  |  | $ | 536 |  |  | $ | 339,666 |  |  | $ | 547,177 |  |  | $ | (12,191 | ) |  | $ | 875,188 |
Stock compensation benefit | — |  |  | — |  |  | (636 | ) |  | — |  |  | — |  |  | (636 | )
Release of restricted stock | 65 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Tax deficiency of stock compensation | — |  |  | — |  |  | (167 | ) |  | — |  |  | — |  |  | (167 | )
Taxes paid related to net share settlement of equity awards | — |  |  | — |  |  | (196 | ) |  | — |  |  | — |  |  | (196 | )
Amounts reclassified from accumulated other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | 266 |  |  | 266 |
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | — |  |  | (21,526 | ) |  | (21,526 | )
Net income attributable to EZCORP, Inc. | — |  |  | — |  |  | — |  |  | 15,260 |  |  | — |  |  | 15,260 |
Balances as of December 31, 2014 | 53,650 |  |  | $ | 536 |  |  | $ | 338,667 |  |  | $ | 562,437 |  |  | $ | (33,451 | ) |  | $ | 868,189 |
| Restatement Adjustments
Balances as of September 30, 2014 | — |  |  | $ | — |  |  | $ | (7,402 | ) |  | $ | (37,591 | ) |  | $ | 2,109 |  |  | $ | (42,884 | )
Stock compensation benefit | — |  |  | — |  |  | (1,822 | ) |  | — |  |  | — |  |  | (1,822 | )
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | — |  |  | 2,826 |  |  | 2,826 |
Net income attributable to EZCORP, Inc. | — |  |  | — |  |  | — |  |  | (3,648 | ) |  | — |  |  | (3,648 | )
Balances as of December 31, 2014 | — |  |  | $ | — |  |  | $ | (9,224 | ) |  | $ | (41,239 | ) |  | $ | 4,935 |  |  | $ | (45,528 | )
| As Restated
Balances as of September 30, 2014 | 53,585 |  |  | $ | 536 |  |  | $ | 332,264 |  |  | $ | 509,586 |  |  | $ | (10,082 | ) |  | $ | 832,304 |
Stock compensation benefit | — |  |  | — |  |  | (2,458 | ) |  | — |  |  | — |  |  | (2,458 | )
Release of restricted stock | 65 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Tax deficiency of stock compensation | — |  |  | — |  |  | (167 | ) |  | — |  |  | — |  |  | (167 | )
Taxes paid related to net share settlement of equity awards | — |  |  | — |  |  | (196 | ) |  | — |  |  | — |  |  | (196 | )
Amounts reclassified from accumulated other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | 266 |  |  | 266 |
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | — |  |  | (18,700 | ) |  | (18,700 | )
Net income attributable to EZCORP, Inc. | — |  |  | — |  |  | — |  |  | 11,612 |  |  | — |  |  | 11,612 |
Balances as of December 31, 2014 | 53,650 |  |  | $ | 536 |  |  | $ | 329,443 |  |  | $ | 521,198 |  |  | $ | (28,516 | ) |  | $ | 822,661 |

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- Definition Tabular disclosure of prior period adjustments to previously issued financial statements including (1) the effect of the correction on each financial statement line item and any per-share amounts affected for each prior period presented (2) the cumulative effect of the change on retained earnings or other appropriate components of equity or net assets in the statement of financial position, as of the beginning of the earliest period presented, and (3) the effect of the prior period adjustments (both gross and net of applicable income tax) on the net income of each prior period presented in the entity's annual report for the year in which the adjustments are made. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=56949863&loc=d3e22663-107794 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 7 -URI http://asc.fasb.org/extlink&oid=56949863&loc=d3e22644-107794 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 8 -URI http://asc.fasb.org/extlink&oid=56949863&loc=d3e22658-107794 + Details
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