The Cash Store Australia Holdings Inc. reports 25% increase in revenue for the third Quarter ended March 31, 2011

EDMONTON, May 19 /CNW/ - The Cash Store Australia Holdings Inc. (ʺCash Store Australiaʺ) (TSXV: AUC) today announced results for the three and nine months ended March 31, 2011.

Highlights for third quarter (table of results at end of release)

  • Revenue up 25.0% to $4.0 million, from $3.2 million for the same quarter last year.

  • Record other revenue of $429,000, up from $34,000 for the same quarter last year.

  • Net loss of $908,000, compared to net income of $215,000 for the same quarter last year.

  • Branch operating loss was $19,000 compared to a branch operating income of $890,000 for the same quarter last year.

  • Diluted loss per share of ($0.06) compared to diluted earnings per share of $0.01 for the same quarter last year.

  • Same branch revenues for the 43 locations open prior to the beginning of the same quarter of fiscal 2010 decreased 6.8% to $64,600 from $69,300 in the third quarter last year.

  • EBITDA of ($636,000) compared to $360,000 in the same quarter last year.

  • Opened four new branches and consolidated one branch with a nearby branch in the quarter.

Highlights for nine months ended March 31, 2011

  • Revenue up 46.2% to $11.4 million, from $7.8 million for the same nine month period last year.

  • Record other revenue of $852,000, up from $105,000 in the same nine month period last year.

  • Net loss of $3.3 million, compared to net income of $38,000 for the same nine month period last year.

  • Branch operating income decreased to a loss of $642,000 from income of $2.0 million for the same nine month period last year.

  • Diluted loss per share of ($0.20) compared to $0.00 for same nine month period last year.

  • Same branch revenues for the 27 locations open prior to the beginning of fiscal 2010 increased by 0.7% to $207,600 from $206,100 for the same period last year.

  • EBITDA of ($2.6 million) down from $419,000 in the same nine month period last year.

  • Opened 30 net branches for a total of 80 branches as at March 31, 2011, compared to 50 as at March 31, 2010.

Chief Executive Officer Ed McClelland commented: ʺFlooding in Queensland and Victoria negatively impacted loan fees in the quarter. Revenue growth in the third quarter was up 25.0% to $4.0 million from $3.2 million for the same quarter last year. We incurred a net loss of $908,000 compared to a profit of $215,000 for the third quarter last year. Had the flooding not occurred, improvements in the quarter would have been stronger. We continue to build a solid platform for future growth. Diversification of revenue is a key element of our strategy. In the quarter we achieved record other revenues of $429,000, or 10% of overall revenue, compared to $34,000, or 1% of revenue, relative to the same period last year. 95% of our branches are in the early stages of development and have very strong growth potential. We continue to focus on improved training and sales processes that are anticipated to improve revenue and earnings over subsequent periods. We have halted the roll‐out of new branches to allow our branch network to achieve an appropriate level of profitability to fund continued growth."

Mr. McClelland concluded: "Demand for our products and services is strong and continues to grow. Cash Store Australia has solidified a national footprint and remains confident about our future earnings potential. As a result of our national presence we have been invited to sit on a Treasury Department stakeholder panel regarding the regulation of payday loans and are continuing to demonstrate leadership and are advancing proposals for enhanced consumer protection measures. We are helping to shape the future of the industry in Australia."

About Cash Store Australia

Cash Store Australia is the only broker of short‐term advances and provider of alternative financial services in Australia that is publicly traded on the TSX Venture Exchange (TSXV: AUC). Cash Store Australia operates 80 payday advance branches in the States of Victoria, Queensland, Tasmania, New South Wales, South Australia and the Northern Territory, Australia under the banner "The Cash Store".

Cash Store Australia acts as a broker to facilitate short‐term advances and provides other financial services to income‐earning consumers who may not be able to obtain them from traditional financial institutions.

Summary Financial Information

    Three Months Ended Nine Months Ended
Consolidated results   March 31 March 31 March 31 March 31
(presented in Canadian dollars)   2011 2010 2011 2010
  No. of branches 80 50 80 50
       Loan fees    $  3,587,479  $ 3,167,769  $ 10,505,046  $       7,646,869
       Other income            429,476          34,211           851,749              104,832
          4,016,955     3,201,980     11,356,795           7,751,701
Branch expenses          
       Salaries and benefits         2,086,116     1,098,480        5,728,324           2,828,227
       Retention payments            523,505        375,238        2,257,014              836,136
       Rent            610,084        324,736        1,612,482              808,966
       Selling, general, and administrative          440,973        218,025        1,286,703              555,459
       Advertising and promotion            179,037        194,429           593,103              504,776
       Depreciation of property and equipment            196,016        101,505           520,803              247,034
          4,035,731     2,312,413     11,998,429           5,780,598
Branch Operating Income (Loss)           (18,776)        889,567         (641,634)           1,971,103
       Regional expenses            173,185        120,956           533,796              321,126
       Corporate expenses            668,448        502,771        2,357,779           1,518,397
       Other depreciation and amortization            16,889          10,303             46,461                29,324
       Foreign exchange (gain) loss            31,019          40,318         (235,406)                64,619
Operating income (loss) before income taxes        (908,317)        215,219      (3,344,264)                37,637
EBITDA*          (636,482)        359,748      (2,599,602)              418,874
Net income (loss)    $    (908,317)  $    215,219  $  (3,344,264)  $            37,637
Weighted average number of shares outstanding - basic   16,425,981   16,375,482 16,425,723         16,375,482
Basic and Diluted earnings (loss) per share  $         (0.06) $         0.01  $          (0.20)  $               0.00
Consolidated Balance Sheet Information        
Working capital    $ (5,176,766)  $  (270,141)  $  (5,176,766)  $        (270,141)
Total assets         4,642,482     3,009,008        4,642,482           3,009,008
Total long-term liabilities            216,245          97,361           216,245                97,361
Total liabilities         6,668,316     1,549,794        6,668,316           1,549,794
Shareholders' equity (deficit)    $ (2,025,834)  $ 1,459,294  $  (2,025,834)  $       1,459,294
* EBITDA - earnings before interest, income taxes, stock-based compensation, depreciation of property and equipment and amortization of intangible assets.

Forward Looking Information

This News Release contains "forward‐looking information" within the meaning of applicable Canadian securities legislation. Forward‐looking information includes, but is not limited to, information with respect to our objectives, strategies, operations and financial results. 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 forward looking statements indicate that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieve.

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 Australia, to be materially different from those expressed or implied by such forwardlooking information. 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. 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 pay day 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.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


SOURCE The Cash Store Australia Holdings Inc.

For further information:

on Cash Store Australia, please contact:

Edward McClelland, Chief Executive Officer
(905) 632‐7594; e‐mail: 


Nancy Bland, Chief Financial Officer
(780) 732‐5683; e‐mail:

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