Cash Store Financial reports strong net income growth of 48% for the quarter



    EDMONTON, April 28 /CNW/ - The Cash Store Financial Services Inc. ("Cash
Store Financial") today announced third Quarter results for the period ended
March 31, 2009.

    
    Third Quarter Highlights (table of results at end of release)

    -   Net income up 47.6% to $3.1 million, compared to $2.1 million for the
        same quarter last year.
    -   Diluted earnings per share of $0.18 up 80.0%, compared to $0.10 for
        the same quarter last year.
    -   Branch operating income up 33% to $11.7 million, compared to $8.8
        million for the same quarter last year.
    -   Same branch revenues increased 11.5% to $93,200 from $83,600 for the
        same quarter last year.
    -   10 new branches added during the quarter, with 45 net new branches
        added since March 31, 2008.
    -   Retention payments of $4.5 million (3.2% of loans brokered), compared
        to $4.8 million (3.9% of loans brokered) for the same quarter last
        year.
    -   Cash position increased to $17.5 million at quarter end from $15.6
        million at June 30, 2008.
    -   Declared a quarterly dividend of 6.5 cents per share, to be paid on
        May 20, 2009 to shareholders of record as of May 5, 2009.

    Year to date highlights (nine months)

    -   Net income up 76.3% to $13.4 million, compared to $7.6 million for
        the same period last year.
    -   Diluted earnings per share of $0.73 up 97.3%, compared to $0.37 for
        the same quarter last year.
    -   Branch operating income up 41.1% to $39.8 million, compared to $28.2
        million for the same quarter last year.
    -   Same branch revenues increased 10.4% to $290,800 from $263,400 for
        the same period last year.
    -   Retention payments of $13.4 million (3.1% of loans brokered),
        compared to $15.9 million (4.1% of loan volume) for the nine months
        ended March 31, 2009.
    -   Shares repurchased of 2.72 million for a total cost of $16.1 million
        compared to 1.4 million shares at a $5.6 million for the same period
        last year, which leaves 16,927,482 common shares issued and
        outstanding.
    -   Total dividend payments of $4.2 million compared to $3.1 million for
        the same period last year.
    

    Mr. Gordon Reykdal, Chairman and CEO commented, "The third quarter of
fiscal 2009 was solid with both top and bottom line growth strongly up
relative to the same period last year, despite the expected seasonal slow-down
and the current recession. The Company continues to realize income and
efficiency gains from its maturing branch network, with revenues up and
retention payments down year-over-year. During the quarter we incurred
specific new operational expenses designed to further improve long-term
efficiencies and staff retention."
    He further commented, "During the quarter, along with our Chief Operating
Officer, I completed our annual President's Tour during which we met directly
with every manager in our national branch network. This tour is a fundamental
component of our hands-on management program. It enables us to quickly
identify positive and negative trends and to respond accordingly. Based on
this exchange with our managers, at this stage, we feel confident that the
recession will have no significant negative impacts on our business. We will
continue to closely monitor our Company's performance in relation to both
industry trends and economic conditions."
    He added: "Key positive developments over the quarter on a year-over-year
comparative basis included a marked increase in same branch revenues, improved
contributions to earnings from our ancillary products, a significant reduction
in retention payments, and improved overall branch earnings. Over the past
several quarters, we have concentrated significantly on the training and
development of our associates. This effort has been rewarded through our
improved performance and management will continue to focus on these
operational areas in future periods."
    Mr. Reykdal concluded, "Overall, we are very well positioned for future
periods given the regulatory environment and our liquidity position. Many
provinces are currently working through a process to establish consumer
protection measures for the payday loan industry. These measures will include
rate caps. We expect all Provinces to have provided full clarity on rate caps
by the close of calendar 2009. All Canadian jurisdictions appear committed to
facilitating a competitive industry. Current liquidity restrictions in
Canada's capital markets have had no impact on the accessibility of funds for
our customers."

    About Cash Store Financial

    Cash Store Financial is the only payday advance broker in Canada publicly
traded on the Toronto Stock Exchange (TSX:CSF). Cash Store Financial operates
more than 420 branches across Canada under the banners: The Cash Store and
Instaloans.
    The Cash Store and Instaloans act as brokers to facilitate payday advance
services to income-earning consumers who may not be able to obtain them from
traditional banks. Cash Store Financial also provides a private-label debit
card - the Freedom card and a prepaid credit card - the Freedom MasterCard,
and other ancillary products.
    Cash Store Financial employs more than 1,600 associates and is
headquartered in Edmonton, Alberta.

    
    Summary Financial Information

    -------------------------------------------------------------------------
    Thousands of dollars,
     except for per share
     amounts and branch
     figures                      Three Months Ended       Nine Months Ended
    -------------------------------------------------------------------------
    Consolidated results        March 31    March 31    March 31    March 31
                                    2009        2008        2009        2008
    -------------------------------------------------------------------------
              No. of branches        423         378         423         378
    Revenue
      Brokerage                $  36,294   $  31,305   $ 110,553   $  96,077
      Corporate                       12          41         222         181
    -------------------------------------------------------------------------
                                  36,306      31,346     110,775      96,258
    Branch expenses               20,110      17,724      57,582      52,217
    Retention payments             4,537       4,800      13,388      15,882
    -------------------------------------------------------------------------
    Branch operating income       11,659       8,822      39,805      28,159
    -------------------------------------------------------------------------

    Regional expenses              2,140       1,730       5,885       5,455
    Corporate expenses             4,523       2,829      11,619       7,661
    Other amortization               311         234         807         576
    Income from continuing
     operations before
     income taxes, class
     action settlement and
     discontinued operations       4,685       4,029      21,494      14,467
    Class action settlement            -           -       1,920           -
    Income from continuing
     operations                    3,067       2,706      13,413       9,332
    Loss from discontinued
     operations                        -        (650)          -      (1,716)
    EBITA                          6,447       5,433      24,669      18,657
    -------------------------------------------------------------------------
    Net income and
     comprehensive income      $   3,067   $   2,056   $  13,413   $   7,616
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average
     number of shares
     outstanding - basic          16,927      19,856      18,299      20,276
    Basic earnings per share
      Income from continuing
       operations              $    0.18   $    0.14   $    0.73   $    0.46
      Loss from discontinued
       operations                      -       (0.04)          -       (0.08)
      Net income and
       comprehensive income         0.18        0.10        0.73        0.38
    Diluted earnings per share
      Income from
       continuing operations        0.18        0.13        0.73        0.46
      Loss from discontinued
       operations                      -       (0.03)          -       (0.09)
      Net income and
       comprehensive income    $    0.18   $    0.10        0.73   $    0.37
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Consolidated Balance
     Sheet Information
    Working capital            $  10,360   $  14,407   $  10,360   $  14,407
    Total assets                  80,213      81,092      80,213      81,092
    Total long-term
     liabilities                   2,267       1,960       2,267       1,960
    Total liabilities             14,984      12,246      14,984      12,246
    Shareholders' equity       $  65,229   $  68,846   $  65,229   $  68,846
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    This News Release contains "forward-looking information" within the
meaning of applicable Canadian and United States securities legislation.
Forward-looking information includes, but is not limited to, information with
respect to our objectives, strategies, operations and financial results,
competition as well initiatives to grow revenue or reduce retention payments.
Generally, forward-looking information can be identified by the use of
forward-looking terminology such as "plans", "expects", or "does not expect",
"is expected", "budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates", or "does not anticipate", or "believes" or variations of such
words and phrases or state that certain actions, events or results "may",
"could", "would", "might", or "will be taken", "occur", or "be achieved". In
particular this News Release contains forward-looking statements in connection
with the Cash Store Financials goals and strategic priorities, introduction of
products, share repurchase initiatives and branch openings. Forward-looking
information is subject to known and unknown risks, uncertainties and other
factors that may cause the actual results, level of activity, performance or
achievements of Cash Store Financial, to be materially different from those
expressed or implied by such forward-looking information, including, but not
limited to, changes in economic and political conditions, legislative or
regulatory developments, technological developments, third-party arrangements,
competition, litigation, risks associated with but not limited to, market
conditions, and other factors described in our Annual Information Form ("AIF")
dated August 28, 2008 under the heading "Risk Factors". All material
assumptions used in making forward-looking statements are based on
management's knowledge of current business conditions and expectations of
future business conditions and trends, including our knowledge of the current
credit, interest rate and liquidity conditions affecting us and the Canadian
economy. Although we believe the assumptions used to make such statements are
reasonable at this time and have attempted to identify in our continuous
disclosure documents important factors that could cause actual results to
differ materially from those contained in forward-looking statements, there
may be other factors that cause results not to be as anticipated, estimated or
intended. Certain material factors or assumptions are applied by us in making
forward-looking statements, include without limitation, factors and
assumptions regarding our continued ability to fund our payday loan business,
rates of customer defaults, relationships with, and payments to, third party
lenders, demand for our products, as well as our operating cost structure and
current consumer protection regulations. There can be no assurance that such
information will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such information.
Accordingly, readers should not place undue reliance on forward-looking
information. We do not undertake to update any forward-looking information,
except in accordance with applicable securities laws.





For further information:

For further information: on Cash Store Financial, please contact: Gordon
J. Reykdal, Chairman and Chief Executive Officer, (780) 408-5118; or Nancy L.
Bland, Chief Financial Officer, (780) 732-5683; or Michael J.L. Thompson,
Senior Vice President & Corporate Secretary, (780) 408-5595, Cell: (780)
934-4729

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The Cash Store Financial Services Inc.

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