Rent-A-Center, Inc. Reports Record First Quarter 2001 Results

Same Store Sales Increase 8.8%



Earnings Per Share $0.03 Above Consensus Estimates



Apr 25, 2001, 01:00 ET from Rent-A-Center, Inc.

    PLANO, Texas, April 25 /PRNewswire/ -- Rent-A-Center, Inc. (Nasdaq:   RCII)
 (the "Company"), announced today record revenues and net earnings for the
 quarter ended March 31, 2001.
     The Company, the nation's largest rent-to-own operator, had total revenues
 for the quarter ended March 31, 2001 of $439.7 million, a $47.2 million
 increase from $392.5 million for the same period in the prior year.  This
 increase of 12.0% was largely a result of better than expected same store
 sales growth of 8.8%, as well as incremental revenues generated in new and
 acquired stores.
     Net earnings for the quarter ended March 31, 2001 were $25.0 million, or
 $0.69 per diluted share, representing an increase of 19.7% over the net
 earnings of $20.9 million, or $0.61 per diluted share, reported for the same
 period in the prior year.  The increase in net earnings and earnings per
 diluted share are primarily attributable to the Company's increase in
 revenues, operational improvements in existing stores and reduced interest
 expense resulting from a reduction in outstanding debt.  At March 31, 2001,
 outstanding debt totaled $703.1 million, down approximately $100.8 million
 from the balance at March 31, 2000.  For the quarter ended March 31, 2001, the
 Company generated $32.0 million in operating cash flow and reduced debt
 outstanding by $37.9 million.
     "We are pleased to announce that demand remained very strong throughout
 the first quarter, which led to our outstanding operating results and
 illustrates the resilience of our business in a weakening economy," commented
 J.E. Talley, the Company's Chairman and Chief Executive Officer.  Mr. Talley
 added, "We remain optimistic about our future growth plans and operating
 results and look forward to another record quarter for our Company."
     During the first quarter of 2001, the Company opened 23 new locations and
 acquired four additional stores in three separate transactions.  Since the end
 of the first quarter, the Company has opened four additional new stores and
 has acquired three stores through two separate transactions.  For the entire
 year ending December 31, 2001, the Company intends to add over 10% to its
 store base through new store expansion and opportunistic acquisitions.
     Rent-A-Center, headquartered in Plano, Texas, currently operates
 2,184 company-owned rent-to-own stores in 50 states, Washington D.C. and
 Puerto Rico.  The stores offer high-quality, durable goods such as home
 electronics, appliances, computers, and furniture and accessories to consumers
 under flexible rental purchase agreements that allow the customer to obtain
 ownership of the merchandise at the conclusion of an agreed-upon rental
 period.  ColorTyme, Inc., a wholly-owned subsidiary of the Company, is a
 national franchisor of 359 rent-to-own stores, 347 of which operate under the
 trade name of "ColorTyme," and the remaining 12 of which operate under the
 "Rent-A-Center" name.
     This press release contains forward-looking statements that involve risks
 and uncertainties.  Such forward looking statements generally can be
 identified by the use of forward-looking terminology such as "may," "will,"
 "expect," "intend," "estimate," "anticipate," or "believe," or the negative
 thereof or variations thereon or similar terminology.  Although the Company
 believes that the expectations reflected in such forward looking statements
 will prove to be correct, the Company can give no assurance that such
 expectations will prove to have been correct.  The actual future performance
 of the Company could differ materially from such statements.  Factors that
 could cause or contribute to such differences include, but are not limited to,
 the risks detailed from time to time in the Company's SEC reports, including
 its annual report Form 10-K for the year ended December 31, 2000 and the
 Company's ability to find locations that meet the Company's criteria for new
 store locations, and the Company's ability to locate existing stores that the
 Company could acquire under acceptable terms.  There is no assurance that the
 Company will be able to find such locations or existing stores, or that it
 would be able to open or acquire such stores.  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 requested by law, the Company is not
 obligated to publicly release any revisions to these forward-looking
 statements to reflect the events or circumstances after the date of this
 report or to reflect the occurrence of unanticipated events.
 
                      Rent-A-Center, Inc. and Subsidiaries
 
                 CONSOLIDATED STATEMENT OF EARNINGS HIGHLIGHTS
 
     (In Thousands of Dollars,          Three Months Ended March 31,
      except per share data)                2001          2000
                                                Unaudited
 
     Total Revenues                      $ 439,702     $ 392,526
 
     Operating Profit                       62,485        58,552
 
     Net Earnings                           24,998        20,889
 
     Diluted Earnings Per Common Share        0.69          0.61
 
     EBITDA                              $  78,558     $  73,630
 
 
                         DILUTED EARNINGS PER COMMON SHARE
                            BEFORE GOODWILL AMORTIZATION
 
     (In Thousands of Dollars,          Three Months Ended March 31,
      except per share data)                2001           2000
                                                 Unaudited
 
     Net Earnings                        $  24,998     $  20,889
     Goodwill Amortization Net of
      Tax Effects                            6,160         6,034
     Adjusted Net Earnings               $  31,158     $  26,923
 
     Diluted Weighted Average Shares
      Outstanding                           36,375        34,236
     Diluted Earnings Per Common Share
      Before Goodwill Amortization       $    0.86     $    0.79
 
 
                      Rent-A-Center, Inc. and Subsidiaries
 
                       CONSOLIDATED STATEMENT OF EARNINGS
 
     (In Thousands of Dollars,         Three months ended March 31,
      except per share data)                2001           2000
     Revenues                                    Unaudited
         Store
             Rentals and fees           $  393,123    $  350,320
             Merchandise sales              30,759        27,339
             Other                           1,330           492
 
                                           425,212       378,151
         Franchise
             Merchandise sales              13,027        12,891
             Royalty income and fees         1,463         1,484
 
                 Total revenues            439,702       392,526
 
     Operating expenses
         Direct store expenses
             Depreciation of rental
              merchandise                   80,812        71,728
             Cost of merchandise sold       21,555        22,830
             Salaries and other expenses   242,219       208,525
         Franchise cost of merchandise
          sold                              12,494        12,441
 
                                           357,080       315,524
 
         General and administrative
          expenses                          12,869        11,475
         Amortization of intangibles         7,268         6,975
 
                 Total operating expenses  377,217       333,974
 
                 Operating profit           62,485        58,552
 
     Interest expense                       16,510        19,008
     Interest income                          (361)         (257)
 
                 Earnings before income
                  taxes                     46,336        39,801
 
     Income tax expense                     21,338        18,912
 
                 NET EARNINGS               24,998        20,889
 
     Preferred dividends                     2,630         2,554
 
     Net earnings allocable to common
      stockholders                       $  22,368     $  18,335
 
     Basic weighted average shares
      outstanding                           24,959        24,311
 
     Basic earnings per common share     $    0.90     $    0.75
 
     Diluted weighted average shares
      outstanding                           36,375        34,236
 
     Diluted earnings per common share   $    0.69     $    0.61
 
                     MAKE YOUR OPINION COUNT -  Click Here
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SOURCE Rent-A-Center, Inc.
    PLANO, Texas, April 25 /PRNewswire/ -- Rent-A-Center, Inc. (Nasdaq:   RCII)
 (the "Company"), announced today record revenues and net earnings for the
 quarter ended March 31, 2001.
     The Company, the nation's largest rent-to-own operator, had total revenues
 for the quarter ended March 31, 2001 of $439.7 million, a $47.2 million
 increase from $392.5 million for the same period in the prior year.  This
 increase of 12.0% was largely a result of better than expected same store
 sales growth of 8.8%, as well as incremental revenues generated in new and
 acquired stores.
     Net earnings for the quarter ended March 31, 2001 were $25.0 million, or
 $0.69 per diluted share, representing an increase of 19.7% over the net
 earnings of $20.9 million, or $0.61 per diluted share, reported for the same
 period in the prior year.  The increase in net earnings and earnings per
 diluted share are primarily attributable to the Company's increase in
 revenues, operational improvements in existing stores and reduced interest
 expense resulting from a reduction in outstanding debt.  At March 31, 2001,
 outstanding debt totaled $703.1 million, down approximately $100.8 million
 from the balance at March 31, 2000.  For the quarter ended March 31, 2001, the
 Company generated $32.0 million in operating cash flow and reduced debt
 outstanding by $37.9 million.
     "We are pleased to announce that demand remained very strong throughout
 the first quarter, which led to our outstanding operating results and
 illustrates the resilience of our business in a weakening economy," commented
 J.E. Talley, the Company's Chairman and Chief Executive Officer.  Mr. Talley
 added, "We remain optimistic about our future growth plans and operating
 results and look forward to another record quarter for our Company."
     During the first quarter of 2001, the Company opened 23 new locations and
 acquired four additional stores in three separate transactions.  Since the end
 of the first quarter, the Company has opened four additional new stores and
 has acquired three stores through two separate transactions.  For the entire
 year ending December 31, 2001, the Company intends to add over 10% to its
 store base through new store expansion and opportunistic acquisitions.
     Rent-A-Center, headquartered in Plano, Texas, currently operates
 2,184 company-owned rent-to-own stores in 50 states, Washington D.C. and
 Puerto Rico.  The stores offer high-quality, durable goods such as home
 electronics, appliances, computers, and furniture and accessories to consumers
 under flexible rental purchase agreements that allow the customer to obtain
 ownership of the merchandise at the conclusion of an agreed-upon rental
 period.  ColorTyme, Inc., a wholly-owned subsidiary of the Company, is a
 national franchisor of 359 rent-to-own stores, 347 of which operate under the
 trade name of "ColorTyme," and the remaining 12 of which operate under the
 "Rent-A-Center" name.
     This press release contains forward-looking statements that involve risks
 and uncertainties.  Such forward looking statements generally can be
 identified by the use of forward-looking terminology such as "may," "will,"
 "expect," "intend," "estimate," "anticipate," or "believe," or the negative
 thereof or variations thereon or similar terminology.  Although the Company
 believes that the expectations reflected in such forward looking statements
 will prove to be correct, the Company can give no assurance that such
 expectations will prove to have been correct.  The actual future performance
 of the Company could differ materially from such statements.  Factors that
 could cause or contribute to such differences include, but are not limited to,
 the risks detailed from time to time in the Company's SEC reports, including
 its annual report Form 10-K for the year ended December 31, 2000 and the
 Company's ability to find locations that meet the Company's criteria for new
 store locations, and the Company's ability to locate existing stores that the
 Company could acquire under acceptable terms.  There is no assurance that the
 Company will be able to find such locations or existing stores, or that it
 would be able to open or acquire such stores.  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 requested by law, the Company is not
 obligated to publicly release any revisions to these forward-looking
 statements to reflect the events or circumstances after the date of this
 report or to reflect the occurrence of unanticipated events.
 
                      Rent-A-Center, Inc. and Subsidiaries
 
                 CONSOLIDATED STATEMENT OF EARNINGS HIGHLIGHTS
 
     (In Thousands of Dollars,          Three Months Ended March 31,
      except per share data)                2001          2000
                                                Unaudited
 
     Total Revenues                      $ 439,702     $ 392,526
 
     Operating Profit                       62,485        58,552
 
     Net Earnings                           24,998        20,889
 
     Diluted Earnings Per Common Share        0.69          0.61
 
     EBITDA                              $  78,558     $  73,630
 
 
                         DILUTED EARNINGS PER COMMON SHARE
                            BEFORE GOODWILL AMORTIZATION
 
     (In Thousands of Dollars,          Three Months Ended March 31,
      except per share data)                2001           2000
                                                 Unaudited
 
     Net Earnings                        $  24,998     $  20,889
     Goodwill Amortization Net of
      Tax Effects                            6,160         6,034
     Adjusted Net Earnings               $  31,158     $  26,923
 
     Diluted Weighted Average Shares
      Outstanding                           36,375        34,236
     Diluted Earnings Per Common Share
      Before Goodwill Amortization       $    0.86     $    0.79
 
 
                      Rent-A-Center, Inc. and Subsidiaries
 
                       CONSOLIDATED STATEMENT OF EARNINGS
 
     (In Thousands of Dollars,         Three months ended March 31,
      except per share data)                2001           2000
     Revenues                                    Unaudited
         Store
             Rentals and fees           $  393,123    $  350,320
             Merchandise sales              30,759        27,339
             Other                           1,330           492
 
                                           425,212       378,151
         Franchise
             Merchandise sales              13,027        12,891
             Royalty income and fees         1,463         1,484
 
                 Total revenues            439,702       392,526
 
     Operating expenses
         Direct store expenses
             Depreciation of rental
              merchandise                   80,812        71,728
             Cost of merchandise sold       21,555        22,830
             Salaries and other expenses   242,219       208,525
         Franchise cost of merchandise
          sold                              12,494        12,441
 
                                           357,080       315,524
 
         General and administrative
          expenses                          12,869        11,475
         Amortization of intangibles         7,268         6,975
 
                 Total operating expenses  377,217       333,974
 
                 Operating profit           62,485        58,552
 
     Interest expense                       16,510        19,008
     Interest income                          (361)         (257)
 
                 Earnings before income
                  taxes                     46,336        39,801
 
     Income tax expense                     21,338        18,912
 
                 NET EARNINGS               24,998        20,889
 
     Preferred dividends                     2,630         2,554
 
     Net earnings allocable to common
      stockholders                       $  22,368     $  18,335
 
     Basic weighted average shares
      outstanding                           24,959        24,311
 
     Basic earnings per common share     $    0.90     $    0.75
 
     Diluted weighted average shares
      outstanding                           36,375        34,236
 
     Diluted earnings per common share   $    0.69     $    0.61
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X72431824
 
 SOURCE  Rent-A-Center, Inc.