Aaron's, Inc. Reports First Quarter 2017 Results

Aaron's, Inc. (the "Company") conducts its operations through three primary businesses: 1) Aaron's branded company-owned and franchised lease-to-own stores, Aarons.com and Woodhaven (collectively, the "Aaron's Business"); 2) the Progressive Leasing virtual lease-to-own business ("Progressive Leasing"); and 3) Dent-A-Med, Inc. ("DAMI"), our second-look financing business.

For the first quarter of 2017, Company revenues were $844.6 million compared with $854.4 million for the first quarter of 2016. Net earnings increased to $53.3 million compared with $49.7 million in the prior year period. Diluted earnings per share increased to $0.74 compared with $0.68 per share a year ago. The effective tax rate for the three months ended March 31, 2017 was 35.5% compared with 37.7% for the prior year period.

On a non-GAAP basis, net earnings for the first quarter of 2017 increased to $57.8 million compared with $52.1 million for the same period in 2016, and earnings per share assuming dilution were $0.80 in the first quarter of 2017 compared with $0.71 for the same quarter in 2016. In 2017, non-GAAP net earnings and non-GAAP diluted earnings per share exclude the effects of amortization expense resulting from our 2014 acquisition of Progressive Leasing and the Aaron's Business and DAMI restructuring charges. In 2016, non-GAAP results exclude the effects of Progressive Leasing amortization, a gain on the sale of the Company's former headquarters building, charges primarily related to the retirement of our former CFO, and an impairment charge resulting from the HomeSmart disposition. Adjusted EBITDA for the Company, which excludes the charges and adjustments mentioned above, was $109.4 million for the first quarter of 2017, compared with $104.0 million for the same period in 2016. See "Use of Non-GAAP Financial Information" and the related non-GAAP reconciliation accompanying this press release.

The Company generated $104.2 million in cash from operations during the three months ended March 31, 2017 and ended the first quarter with $348.5 million in cash compared with $308.6 million at the end of 2016. The Company repurchased 1,208,466 shares of its common stock during the first quarter of 2017, and has authorization to purchase an additional 7,915,255 shares.

The Aaron's Business Results

For the first quarter of 2017, total revenues for the Aaron's Business decreased 13.4% to $470.2 million from $543.0 million in the first quarter of 2016.

Lease revenue and fees for the three months ended March 31, 2017 decreased 13.2% compared with the same period in 2016. Non-retail sales, which primarily consist of merchandise sales to the Company's franchisees, decreased 12.6% for the first quarter compared with the prior-year period.

On May 13, 2016, the Company completed the sale of its HomeSmart business. Revenues for the HomeSmart business in the first quarter of 2016 were $17.8 million. Excluding HomeSmart, total revenues for the Aaron's Business decreased 10.5% for the first quarter compared with the prior-year period.

Earnings before income taxes for the Aaron's Business were $48.6 million for the three months ended March 31, 2017, compared with $60.7 million for the same period a year ago. Adjusted EBITDA in the three months ended March 31, 2017 was $61.2 million compared with $70.9 million for the same period a year ago. As a percentage of revenue, Adjusted EBITDA was 13.0% for the three months ended March 31, 2017, compared with 13.1% for the same period last year. Write offs for damaged, lost or unsaleable merchandise were 3.5% of revenues in both periods.

Same store revenues (revenues earned in Company-operated stores open for the entirety of both quarters) decreased 9.3% during the first quarter of 2017, compared with the first quarter of 2016, and customer count on a same store basis was down 5.9%. Company-operated Aaron's stores had 937,000 customers at March 31, 2017, a 6.7% decrease from the first quarter of 2016, excluding HomeSmart customers for both periods.

At March 31, 2017, the Aaron's Business had 1,155 Company-operated stores and 688 franchised stores. During the first quarter of 2017, one Company-operated store and nine franchised stores were consolidated or closed. Nine Company-operated stores were sold to a third party.

As discussed previously, the Company has undertaken a review of its store base to identify underperforming stores and right size its footprint in existing markets. As part of that review, the Company closed one store in the first quarter of 2017 and identified approximately 70 additional stores to be closed in the second quarter of 2017. The Company continues to expect it will incur an aggregate pre-tax charge of approximately $13 million in 2017 with respect to the stores that have been identified for closure. The Company may decide to close additional stores in future periods.

Progressive Leasing Results

Progressive Leasing's revenue in the first quarter of 2017 increased 19.4% to $366.1 million from $306.7 million in the first quarter of 2016. Active doors increased 38% in the first quarter of 2017 to approximately 18,600. Invoice volume per active door declined 12.8% in the quarter, driven by strong growth in new doors. Progressive Leasing had 604,000 customers at March 31, 2017, a 19% increase from March 31, 2016.

Earnings before income taxes for Progressive Leasing were $35.8 million for the three months ended March 31, 2017 as compared with $21.9 million for the same period a year ago. EBITDA for the three months ended March 31, 2017 was $48.5 million compared with $34.8 million for the same period of 2016. As a percentage of revenues, EBITDA was 13.2% for the three months ended March 31, 2017, compared with 11.3% for the same period in 2016. Write offs for damaged, lost or unsaleable merchandise were 4.8% of revenue in the first quarter of 2017, compared with 6.2% in the same period of 2016.

DAMI Results

Revenue for DAMI was $8.2 million in the first quarter of 2017, compared with $4.8 million in the first quarter of 2016. DAMI's loss before income taxes was $1.8 million for the three months ending March 31, 2017, compared with a loss before income taxes of $2.9 million in the first quarter of 2016. Its pre-tax, pre-provision loss was $1.2 million in both periods. DAMI has performed in line with our expectations in the first quarter of 2017.

Pre-tax, pre-provision loss is a non-GAAP measure that represents loss before income taxes adjusted so that loan charge-offs and recoveries are recognized in earnings as they occur by excluding the effect on earnings of changes to management's provision for estimated future loan losses. See "Use of Non-GAAP Financial Information" and the related non-GAAP reconciliation accompanying this press release for more information regarding the calculation of pre-tax, pre-provision loss.

Significant Components of Revenue

Consolidated lease revenues and fees for the three months ended March 31, 2017 increased 0.3% over the same prior year period. Franchise royalties and fees decreased 12.9% in the first quarter of 2017 compared with the same period a year ago. The decrease in franchise royalties and fees was the combined result of decreases in revenues generated by our franchisees and the number of franchised stores. Our franchisee revenues totaled $230.4 million in the three months ended March 31, 2017, a decrease of 7.8% from the same period for the prior year. Same store revenues for franchised stores were down 4.9% and same store customer counts were down 4.1% for the first quarter of 2017 compared with the same quarter for the prior year. Franchised stores had 520,000 customers at the end of the first quarter, a 7.5% decline from the prior year ago period (revenues and customers of franchisees are not revenues and customers of the Aaron's Business or Aaron's, Inc.).

2017 Outlook

The outlook the Company issued on February 17, 2017 remains unchanged.

Conference Call and Webcast

Aaron's, Inc. will hold a conference call to discuss its quarterly results on Friday, April 28, 2017, at 8:30 a.m. Eastern Time. The public is invited to listen to the conference call by webcast accessible through the Company's Investor Relations website, investor.aarons.com. The webcast will be archived for playback at that same site.

About Aaron's, Inc.

Headquartered in Atlanta, Aaron's, Inc. (NYSE: AAN), is a leading omnichannel provider of lease-purchase solutions. The Aaron's Business engages in the sales and lease ownership and specialty retailing of furniture, consumer electronics, home appliances and accessories through its more than 1,800 Company-operated and franchised stores in 47 states and Canada, as well as its e-commerce platform, Aarons.com. In addition, Progressive Leasing, a virtual lease-to-own company, provides lease-purchase solutions through approximately 22,000 retail locations in 46 states. Dent-A-Med, Inc., d/b/a the HELPcard®, provides a variety of second-look credit products that are originated through federally insured banks. For more information, visit investor.aarons.com, Aarons.com, ProgLeasing.com, and HELPcard.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this news release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Such forward-looking statements generally can be identified by the use of forward-looking terminology, such as "may," "expect," "expectations," "outlook," "forecast," "guidance," "intend," "believe," "could," "project," "estimate," "anticipate," "should" and similar terminology. These risks and uncertainties include factors such as changes in general economic conditions, competition, pricing, legal and regulatory proceedings, customer privacy, information security, customer demand, the execution and results of our strategy and expense reduction and store closure and consolidation initiatives, risks related to Progressive Leasing's "virtual" lease-to-own business, the outcome of Progressive Leasing's pilot or test programs with various retailers and the results of Progressive Leasing's efforts to expand its relationships with existing retailer partners and establish new partnerships with additional retailers, and the other risks and uncertainties discussed under "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2016. Statements in this release that are "forward-looking" include without limitation statements regarding: Aaron's, Inc.'s projected results (including Progressive Leasing's and DAMI's results) and guidance for 2017, the number of stores the Company expects to close in the second quarter of 2017 and the charges expected to be incurred in connection therewith, continuing to gain share in Progressive Leasing's markets, transforming the Aaron's direct-to-consumer platform, driving long-term growth, the outcome and results of our strategic investments and objectives, and our ability to fund those investments, and management's capital allocation plans. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as required by law, the Company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances after the date of this press release.

Aaron's, Inc. and Subsidiaries Consolidated Statements of Earnings (In thousands, except per share amounts)
		(Unaudited)  Three Months Ended
		March 31,
		2017			2016
Revenues:
Lease Revenues and Fees		$	743,622		$	741,611
Retail Sales		8,778			10,955
Non-Retail Sales		69,327			79,305
Franchise Royalties and Fees		14,201			16,295
Interest and Fees on Loans Receivable		8,201			4,763
Other		425			1,498
Total		844,554			854,427
Costs and Expenses:
Depreciation of Lease Merchandise		361,998			348,302
Retail Cost of Sales		5,391			7,065
Non-Retail Cost of Sales		62,085			71,385
Operating Expenses		328,825			348,424
Restructuring Expenses		327			—
Other Operating (Income) Expense, Net		(561)			(6,729)
Total		758,065			768,447
Operating Profit		86,489			85,980
Interest Income		974			421
Interest Expense		(5,815)			(6,312)
Other Non-Operating Income (Expense), Net		975			(361) Werbung Mehr Nachrichten zur Aaron's Holdings Company A Aktie kostenlos abonnieren E-Mail-Adresse Bitte überprüfe deine die E-Mail-Adresse. Benachrichtigungen von ARIVA.DE (Mit der Bestellung akzeptierst du die Datenschutzhinweise) -1 Vielen Dank, dass du dich für unseren Newsletter angemeldet hast. Du erhältst in Kürze eine E-Mail mit einem Aktivierungslink. Hinweis: ARIVA.DE veröffentlicht in dieser Rubrik Analysen, Kolumnen und Nachrichten aus verschiedenen Quellen. Die ARIVA.DE AG ist nicht verantwortlich für Inhalte, die erkennbar von Dritten in den „News“-Bereich dieser Webseite eingestellt worden sind, und macht sich diese nicht zu Eigen. Diese Inhalte sind insbesondere durch eine entsprechende „von“-Kennzeichnung unterhalb der Artikelüberschrift und/oder durch den Link „Um den vollständigen Artikel zu lesen, klicken Sie bitte hier.“ erkennbar; verantwortlich für diese Inhalte ist allein der genannte Dritte. Andere Nutzer interessierten sich auch für folgende News 08:56 - PR Newswire Samson Rock Capital LLP - Form 8.3 - TClarke Plc 08:53 - PR Newswire Samson Rock Capital LLP - Form 8.3 - Shanta Gold Ltd 02:00 - PR Newswire Kasei Digital Assets Plc - Launch of New Interactive Investor Hub SolarBank    Wie die Revolution der sauberen Energie eine solide Investitionsmöglichkeit bieten könnte weiterlesen» Anzeige wo-site-teaser-box-16755_site-teaser-box_2024-04-25_09%253A00%253A00_2024-04-26_09%253A00%253A59