Rent-A-Center, Inc. Reports First Quarter 2017 Results

PLANO, Texas - May 01, 2017 - (BUSINESS WIRE) - Rent-A-Center, Inc. (the "Company") (NASDAQ/NGS: RCII) today announced results for the quarter ended March 31, 2017.

“During the first quarter, Rent-A-Center delivered solid progress on our near-term strategies to strengthen the Core U.S. business, as demonstrated by our sequential improvement in our key operating metrics and financial results,” said Mark Speese, Chairman of the Rent-A-Center Board and Chief Executive Officer.

“While we are encouraged by our recent efforts, we recognize there is still work to be done and we remain focused on executing our comprehensive strategic plan to restore growth and improve profitability over the long-term. Given the portfolio nature of the business, it will take time for the actions we are implementing to be fully realized in our results; however, the Rent-A-Center Board and management are confident that we are taking the right steps to deliver enhanced value for all Rent-A-Center stockholders,” Mr. Speese concluded.

Progress on Strategic Plan

During the first quarter of 2017, the Company took a number of actions to strengthen the Core U.S. business. A new competitive value proposition was implemented that is intended to increase demand and retention, and improve the customer experience. The Company also identified and began to execute on a new assortment strategy aimed at shifting towards more higher-end aspirational products. There was also a continued heightened focus on improving the quality of the portfolio through best practices and better execution in account management. Lastly, the Company developed and deployed a more focused approach to training and development enabling consistent execution, strengthening of customer relationships, and reducing co-worker turnover.

Key Highlights

  • Sequential reduction in delinquencies for March of 140 basis points, to 6.1 percent, in the Core U.S. segment
  • Sequential reduction in delinquencies for March of 40 basis points, to 8.8 percent, in the Acceptance Now segment
  • Annualized co-worker turnover, as of March, of 83.7 percent, a 10.4 percentage point improvement versus prior year
  • Core U.S. same store sales for the quarter improved sequentially by 140 basis points
  • Acceptance Now same stores sales for the quarter improved sequentially by 120 basis points
  • On a GAAP basis, consolidated loss before income taxes improved $160.6 million sequentially and diluted loss per share improved by $2.63 sequentially
  • Diluted earnings per share excluding special items improved by $0.27 sequentially
  • Consolidated adjusted EBITDA improved by $23.4 million sequentially
  • Debt was reduced by $71.6 million in the first quarter
  • Core U.S. held for rent inventory of $174.5 million declined 9.5 percent sequentially

Consolidated Overview

Explanations of performance are excluding special items and compared to the prior year unless otherwise noted.

On a consolidated basis, total revenues were $742.0 million versus $835.7 million in the first quarter of last year. Consolidated same store sales improved 150 basis points versus the fourth quarter of 2016 due to the progress made on executing the Company’s initiatives. Diluted loss per share, on a GAAP basis, was $0.13 compared to earnings of $0.47 in the first quarter of last year.

Excluding special items, the Company’s diluted earnings per share was $0.04, a $0.27 increase from the fourth quarter of 2016. The Company generated $33.3 million in adjusted EBITDA in the first quarter, a significant improvement of $23.4 million versus the fourth quarter of 2016. In addition, adjusted EBITDA as a percent of revenue increased 300 basis points versus the fourth quarter to 4.5 percent.

The Company generated $59.1 million of cash from operations and ended the first quarter with $58.1 million of cash and cash equivalents. The Company paid on April 20, 2017, a quarterly dividend for the second quarter of 2017 in the amount of $0.08 per share and also reduced its outstanding debt balance by $71.6 million in the first quarter. The Company’s current bank group has waived compliance with certain covenants for the first quarter and the Company is in the process of obtaining an amendment to the existing credit facility.

Segment Operating Performance

CORE U.S. first quarter revenues of $490.9 million decreased 16.0 percent primarily due to lower same store sales and the continued rationalization of the Core U.S. store base. Core U.S. same store sales improved 140 basis points sequentially. Gross profit as a percent of total revenue decreased 170 basis points due to targeted pricing actions implemented to right size the inventory mix. However, the held for rent inventory declined 9.5 percent sequentially demonstrating the Company's progress on moving the older, promotional inventory through the system faster and upgrading the inventory assortment. Labor decreased $17.0 million, however, as a percent of store revenue, increased primarily due to sales deleverage. Other store expenses decreased $16.4 million, however, as a percent of store revenue, increased primarily due to sales deleverage.

ACCEPTANCE NOW first quarter revenues of $234.5 million increased 1.8 percent primarily due to the same store sales increase of 2.9 percent. Gross profit as a percent of total revenue versus prior year improved 60 basis points driven by favorable revenue mix. Labor, as a percent of store revenue, improved versus prior year by 30 basis points. Other store expenses, as a percent of store revenue, increased 70 basis points primarily driven by higher skip/stolen losses which increased by 40 basis points.

MEXICO first quarter revenues decreased 19.3 percent driven by currency fluctuations and store closures. Same store sales were down 6.0 percent. Gross profit as a percent of total revenue versus prior year improved 270 basis points driven by higher merchandise sales gross margin due to pricing initiatives. Operating profit improved by $0.4 million.

FRANCHISING first quarter revenues decreased 23.8 percent due to a lower amount of merchandise sold to the Company’s franchise partners and operating profit was flat year over year at $1.4 million.

CORPORATE operating expenses remained flat at $42.0 million compared to prior year as lower general and administrative expenses, due to the recent reductions at our Field Support Center, were offset by higher depreciation brought about by the implementation of the new point of sale system in 2016.

     
SAME STORE SALES
(Unaudited)
     
Table 1    
Period   Core U.S.   Acceptance Now   Mexico   Total
Three Months Ended March 31, 2017   (12.5 )%   2.9 %   (6.0 )%   (7.8 )%
Three Months Ended December 31, 2016   (13.9 )%   1.7 %   (1.4 )%   (9.3 )%
Three Months Ended March 31, 2016   (3.2 )%   0.6 %   9.7 %   (1.9 )%
                         
Note: Revised Same Store Sales Methodology - Same store sales generally represents revenue earned in stores that were operated by us for 13 months or more and are reported on a constant currency basis. Under the revised methodology, the Company will exclude from same store sales base any store that receives a certain level of customer accounts from another store (acquisition or merger). The receiving store will be eligible for inclusion in the same store sales base in the twenty-fourth full month following the account transfer. The Company believes these modifications better align its same store sales calculation with the methods used by other rent-to-own companies.

 

                 
KEY OPERATING METRICS
(Unaudited)
                 
Table 2  

Same Store
Sales

  Delinquencies  

Annualized Co-worker Turnover

 

Average Monthly
Rate of New
Agreements

Segment  

Change vs
2016 (%)

  2017  

Sequential
Change (BPS)

  2017  

Change vs
2016 (PPT)

 

Change vs
2016 (%)

Core U.S.                        
January   (11.5 )%   9.3%   (30 )   76.1%   (4.5 )   (4.7 )%
February   (16.0 )%   7.5%   (180 )   75.6%   (14.7 )   (4.1 )%
March   (9.6 )%   6.1%   (140 )   83.7%   (10.4 )   (6.6 )%
Acceptance Now                        
January   2.5 %   9.0%   60              
February   (3.8 )%   9.2%   20              
March   12.4 %   8.8%   (40 )            
                             

 

Note: In the Core U.S. segment delinquencies represent the percent of customer agreements greater than 7 days past due. In the Acceptance Now segment delinquencies represent the percent of customer agreements greater than 32 days past due.

 

Non-GAAP Reconciliation

To supplement the Company's financial results presented on a GAAP basis, Rent-A-Center uses the non-GAAP measures ("special items”) indicated in Table 3 below, which excludes charges in 2017 for the closure of Acceptance Now locations, reductions in our field support center, litigation claims settlement, incremental legal and advisory fees, and discrete income tax items. Gains or charges related to sales of stores, store closures, and discrete adjustments to tax reserves will generally recur with the occurrence of these events in the future. The presentation of these financial measures is not in accordance with, or an alternative for, accounting principles generally accepted in the United States and should be read in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP. Rent-A-Center management believes that excluding special items from the GAAP financial results provides investors a clearer perspective of the Company's ongoing operating performance and a more relevant comparison to prior period results.

Please see the Company's earnings press release dated February 13, 2017 for additional information related to non-GAAP diluted loss per share excluding special items used to calculate the sequential improvements contained in this press release.

Reconciliation of net (loss) earnings to net earnings excluding special items:

         
Table 3   Three Months Ended   Three Months Ended
    March 31, 2017   March 31, 2016
(in thousands, except per share data)   Amount   Per Share   Amount   Per Share
Net (loss) earnings   $ (6,679 )   $ (0.13 )   $ 25,061     $ 0.47  
Special items, net of taxes:                
Other charges (1)     8,687       0.17       1,576       0.03  
Discrete income tax items     123             (981 )     (0.02 )
Net earnings excluding special items   $ 2,131     $ 0.04     $ 25,656     $ 0.48  
                 

 

(1) Other charges for the three months ended March 31, 2017 and 2016 primarily includes charges, net of tax, related to the closure of Acceptance Now locations, reductions in our field support center, litigation claims settlement, incremental legal and advisory fees, and the closure of Mexico stores in the prior year. Charges related to store closures are primarily comprised of losses on rental merchandise, lease obligation costs, employee severance, asset disposals, and miscellaneous costs incurred as a result of the closure.

2017 Outlook

The Company is not providing annual guidance as it relates to revenue or diluted earnings per share for 2017. In an effort to enhance transparency regarding the Company’s results and turnaround efforts, the Company has shifted to a monthly report of key operating metrics (Table 2). The Company believes these changes will provide the investment community meaningful insight into the progress the Company is making on its turnaround.

Webcast Information

Rent-A-Center, Inc. will host a conference call to discuss the first quarter results, guidance and other operational matters on Tuesday morning, May 2, 2017, at 8:30 a.m. ET. For a live webcast of the call, visit http://investor.rentacenter.com. Certain financial and other statistical information that will be discussed during the conference call will also be provided on the same website. Residents of the United States and Canada can listen to the call by dialing (800) 399-0012. International participants can access the call by dialing (404) 665-9632.

About Rent-A-Center, Inc.

A rent-to-own industry leader, Plano, Texas-based, Rent-A-Center, Inc., is focused on improving the quality of life for its customers by providing them the opportunity to obtain ownership of high-quality, durable products such as consumer electronics, appliances, computers, furniture and accessories, under flexible rental purchase agreements with no long-term obligation. The Company owns and operates approximately 2,600 stores in the United States, Mexico, Canada and Puerto Rico, and approximately 1,500 Acceptance Now kiosk locations in the United States and Puerto Rico. Rent-A-Center Franchising International, Inc., a wholly owned subsidiary of the Company, is a national franchiser of approximately 230 rent-to-own stores operating under the trade names of "Rent-A-Center", "ColorTyme", and "RimTyme". For additional information about the Company, please visit our website at www.rentacenter.com.

Forward-Looking Statements

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," "could," "estimate," "should," "anticipate," "believe," or "confident," or the negative thereof or variations thereon or similar terminology. The Company believes that the expectations reflected in such forward-looking statements are accurate. However, there can be no assurance that such expectations will occur. The Company's actual future performance could differ materially from such statements. Factors that could cause or contribute to such differences include, but are not limited to: the general strength of the economy and other economic conditions affecting consumer preferences and spending; factors affecting the disposable income available to the Company's current and potential customers; changes in the unemployment rate; difficulties encountered in improving the financial and operational performance of the Company's business segments; our chief executive officer and chief financial officer transitions, including our ability to effectively operate and execute our strategies during the interim period and difficulties or delays in identifying and/or attracting a permanent chief financial officer with the required level of experience and expertise; failure to manage the Company's store labor and other store expenses; the Company’s ability to develop and successfully execute strategic initiatives; disruptions, including capacity-related outages, caused by the implementation and operation of the Company's new store information management system, and its transition to more-readily scalable, “cloud-based” solutions; the Company’s ability to successfully market smartphones and related services to its customers; the Company's ability to develop and successfully implement virtual or E-commerce capabilities, including mobile applications; disruptions in the Company's supply chain; limitations of, or disruptions in, the Company's distribution network; rapid inflation or deflation in the prices of the Company's products; the Company's ability to execute and the effectiveness of a store consolidation, including the Company's ability to retain the revenue from customer accounts merged into another store location as a result of a store consolidation; the Company's available cash flow; the Company's ability to identify and successfully market products and services that appeal to its customer demographic; consumer preferences and perceptions of the Company's brand; uncertainties regarding the ability to open new locations; the Company's ability to acquire additional stores or customer accounts on favorable terms; the Company's ability to control costs and increase profitability; the Company's ability to retain the revenue associated with acquired customer accounts and enhance the performance of acquired stores; the Company's ability to enter into new and collect on its rental or lease purchase agreements; the passage of legislation adversely affecting the Rent-to-Own industry; the Company's compliance with applicable statutes or regulations governing its transactions; changes in interest rates; adverse changes in the economic conditions of the industries, countries or markets that the Company serves; information technology and data security costs; the impact of any breaches in data security or other disturbances to the Company's information technology and other networks and the Company's ability to protect the integrity and security of individually identifiable data of its customers and employees; changes in the Company's stock price, the number of shares of common stock that it may or may not repurchase, and future dividends, if any; changes in estimates relating to self-insurance liabilities and income tax and litigation reserves; changes in the Company's effective tax rate; fluctuations in foreign currency exchange rates; the Company's ability to maintain an effective system of internal controls; the resolution of the Company's litigation; and the other risks detailed from time to time in the Company's SEC reports, including but not limited to, its Annual Report on Form 10-K for the year ended December 31, 2016. 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 is not obligated to publicly release any revisions to these forward-looking statements to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Additional Information and Where to Find It

The Company, its directors, executive officers and other employees may be deemed to be participants in the solicitation of proxies from the Company’s stockholders in connection with the matters to be considered at Rent-A-Center’s 2017 Annual Meeting. On April 27, 2017, the Company filed its definitive proxy statement (as it may be amended from time to time, the “Proxy Statement”) and definitive form of WHITE proxy card with the U.S. Securities and Exchange Commission (the “SEC”) with respect to its 2017 Annual Meeting. The Company’s stockholders are strongly encouraged to read the Proxy Statement, the accompanying WHITE proxy card and other documents filed with the SEC carefully and in their entirety when they become available because they will contain important information. Additional information regarding the identity of participants, and their direct or indirect interests (by security holdings or otherwise) is set forth in the Proxy Statement. Stockholders can obtain the Proxy Statement, any amendments or supplements to the Proxy Statement and other documents filed by the Company with the SEC free of charge at the SEC’s website at www.sec.gov. Copies also will be available free of charge at the Company’s website at www.rentacenter.com, by contacting the Company’s Investor Relations at 972-801-1100 or by contacting the Company’s proxy solicitor, Okapi Partners LLC, toll free at 1-877-259-6290.

Rent-A-Center, Inc. and Subsidiaries

Please see the Company's earnings press release dated February 13, 2017 for the non-GAAP reconciliation of consolidated adjusted EBITDA in the prior quarterly period which was used to calculate the sequential improvements contained in this press release.

     

STATEMENT OF EARNINGS HIGHLIGHTS - UNAUDITED

     
Table 4   Three Months Ended March 31,
    2017     2017   2016     2016
    Before     After   Before     After
    Special Items     Special Items   Special Items     Special Items
    (Non-GAAP     (GAAP   (Non-GAAP     (GAAP
(In thousands, except per share data)   Earnings)     Earnings)   Earnings)     Earnings)
Total revenues   $ 741,986     $ 741,986     $ 835,652     $ 835,652
Operating profit     14,803

(1)

    1,152       50,865

(3)

    48,430
Net earnings (loss)     2,131

(1)(2)

    (6,679 )     25,656

(3)(4)

    25,061
Diluted earnings (loss) per common share   $ 0.04

(1)(2)

  $ (0.13 )   $ 0.48

(3)(4)

  $ 0.47
Adjusted EBITDA   $ 33,344     $ 33,344     $ 70,689     $ 70,689
Reconciliation to Adjusted EBITDA:                    
Earnings (loss) before income taxes   $ 3,329

(1)

  $ (10,322 )   $ 38,985

(3)

  $ 36,550
Add back:                    
Other charges           13,651             2,435
Interest expense, net     11,474       11,474       11,880       11,880
Depreciation, amortization and impairment of intangibles     18,541       18,541       19,824       19,824
Adjusted EBITDA   $ 33,344     $ 33,344     $ 70,689     $ 70,689
                               

 

(1) Excludes the effects of approximately $13.7 million of pre-tax charges primarily related to the closure of Acceptance Now locations, reductions in our field support center, litigation claims settlement, and incremental legal and advisory fees. These charges reduced net earnings and net earnings per diluted share for the three months ended March 31, 2017, by approximately $8.7 million and $0.17, respectively.

(2) Excludes the effects of $0.1 million of discrete income tax adjustments.
(3) Excludes the effects of $2.4 million of pre-tax charges related to the closure of Mexico stores. These charges reduced net earnings and net earnings per diluted share for the three months ended March 31, 2016, by approximately $1.6 million and $0.03, respectively.
(4) Excludes the effects of $1.0 million of discrete income tax adjustments that increased net earnings per diluted share by $0.02.

 

       

SELECTED BALANCE SHEET HIGHLIGHTS - UNAUDITED

       
Table 5   March 31,  
(In thousands)   2017   2016  
Cash and cash equivalents   $ 58,128     $ 46,362    
Receivables, net     66,606       67,926    
Prepaid expenses and other assets     52,159       62,147    
Rental merchandise, net          
On rent     754,824       822,821    
Held for rent     190,629       251,329    
Goodwill     55,308       207,130    
Total assets     1,494,974       1,795,421    
           
Senior debt, net   $ 115,625     $ 207,971    
Senior notes, net     537,799       536,509    
Total liabilities     1,236,538       1,386,570  

(1)

Stockholders' equity     258,436       408,851  

(1)

 

(1) Total liabilities and stockholders' equity for the first quarter of fiscal year 2016 are revised for the correction of a deferred tax error associated with our goodwill impairment reported in the fourth quarter of 2015 as discussed in our Annual Report on Form 10-K for the year ended December 31, 2016.

 

     
Rent-A-Center, Inc. and Subsidiaries
 
CONSOLIDATED STATEMENTS OF EARNINGS - UNAUDITED
     
Table 6 Three Months Ended March 31,  
(In thousands, except per share data) 2017   2016  
Revenues        
Store        
Rentals and fees $ 595,414     $ 674,295    
Merchandise sales 121,722     131,707    
Installment sales 16,757     18,420    
Other 2,652     4,088    
Total store revenues 736,545     828,510    
Franchise        

Merchandise sales

3,321     4,947    
Royalty income and fees 2,120     2,195    

Total revenues

741,986     835,652    
Cost of revenues        
Store        
Cost of rentals and fees 162,033     176,241    
Cost of merchandise sold 109,124     113,886    
Cost of installment sales 5,184     6,025    
Total cost of store revenues 276,341     296,152    
Franchise cost of merchandise sold 2,982     4,556    
Total cost of revenues 279,323     300,708    
Gross profit 462,663     534,944    
Operating expenses        
Store expenses        
Labor 192,107     209,387    
Other store expenses 197,440     211,807    
General and administrative expenses 39,772     43,061    
Depreciation, amortization and impairment of intangibles 18,541     19,824    
Other charges 13,651   (1) 2,435   (3)
Total operating expenses 461,511     486,514    
Operating profit 1,152     48,430    
Interest expense 11,630     11,977    
Interest income (156 )   (97 )  
(Loss) earnings before income taxes (10,322 )   36,550    
Income tax (benefit) expense (3,643 ) (2) 11,489   (4)
Net (loss) earnings $ (6,679 )   $ 25,061    
Basic weighted average shares 53,217     53,085    
Basic (loss) earnings per common share $ (0.13 )   $ 0.47    
Diluted weighted average shares 53,217     53,342    
Diluted (loss) earnings per common share $ (0.13 )   $ 0.47    
                 

 

(1)

 

Includes approximately $13.7 million of pre-tax charges primarily related to the closure of Acceptance Now locations, reductions in our field support center, litigation claims settlement, and incremental legal and advisory fees.

(2)

 

Includes $0.1 million of discrete income tax adjustments.

(3)

 

Includes $2.4 million of pre-tax charges related to the closure of Mexico stores.

(4)

 

Includes $1.0 million of discrete income tax adjustments.

 

       
Rent-A-Center, Inc. and Subsidiaries
 
SEGMENT INFORMATION HIGHLIGHTS - UNAUDITED
       
Table 7   Three Months Ended March 31,  
(In thousands)   2017     2016  
Revenues            
Core U.S.   $ 490,899       $ 584,365    
Acceptance Now   234,546       230,396    
Mexico   11,100       13,749    
Franchising   5,441       7,142    
Total revenues   $ 741,986       $ 835,652    
       
Table 8   Three Months Ended March 31,  
(In thousands)   2017     2016  
Gross profit            
Core U.S.   $ 337,954       $ 411,889    
Acceptance Now   114,429       111,142    
Mexico   7,821       9,327    
Franchising   2,459       2,586    
Total gross profit   $ 462,663       $ 534,944    
       
Table 9   Three Months Ended March 31,  
(In thousands)   2017     2016  
Operating profit            
Core U.S.   $ 24,402   (1)   $ 62,236    
Acceptance Now   20,619   (2)   29,369    
Mexico   161       (2,610 ) (4)
Franchising   1,441       1,413    
Total segments   46,623       90,408    
Corporate   (45,471 ) (3)   (41,978 )  
Total operating profit   $ 1,152       $ 48,430    
                     

 

(1)  

Includes approximately $0.6 million of pre-tax charges related to a litigation claims settlement.

(2)  

Includes approximately $9.6 million of pre-tax charges related to the closure of Acceptance Now locations.

(3)  

Includes approximately $2.5 million of pre-tax charges related to reductions in our field support center, and approximately $1.0 million of pretax incremental legal and advisory fees.

(4)   Includes $2.4 million of restructuring charges related to the closure of Mexico stores.

 

     
Table 10   Three Months Ended March 31,
(In thousands)   2017     2016
Depreciation, amortization and impairment of intangibles          
Core U.S.   $ 8,108       $ 10,892
Acceptance Now   786   (1)   837
Mexico   527       939
Franchising   44       45
Total segments   9,465       12,713
Corporate   9,076       7,111
Total depreciation, amortization and impairment of intangibles   $ 18,541       $ 19,824
                 

 

(1)   The Company recorded an impairment of intangibles of $3.9 million in the Acceptance Now segment during the first quarter of 2017 that is not included in the table above.

 

     
Table 11   Three Months Ended March 31,
(In thousands)   2017   2016
Capital expenditures        
Core U.S.   $ 6,108     $ 3,771
Acceptance Now   483     292
Mexico   23     147
Total segments   6,614     4,210
Corporate   15,434     10,230
Total capital expenditures   $ 22,048     $ 14,440

 

         
Table 12   On Rent at March 31,   Held for Rent at March 31,
(In thousands)   2017   2016   2017   2016
Rental merchandise, net                
Core U.S.   $ 388,871     $ 481,434     $ 174,453     $ 239,272
Acceptance Now   351,672     325,476     9,447     5,827
Mexico   14,281     15,911     6,729     6,230
Total rental merchandise, net   $ 754,824     $ 822,821     $ 190,629     $ 251,329

 

     
Table 13   March 31,
(In thousands)   2017   2016
Assets        
Core U.S.   $ 785,800     $ 1,111,298
Acceptance Now   427,541     402,168
Mexico   32,641     34,005
Franchising   2,237     3,197
Total segments   1,248,219     1,550,668
Corporate   246,755     244,753
Total assets   $ 1,494,974     $ 1,795,421

 

     
Rent-A-Center, Inc. and Subsidiaries
 
LOCATION ACTIVITY - UNAUDITED
     
Table 14   Three Months Ended March 31, 2017
    Core U.S.  

Acceptance Now
Staffed

 

Acceptance Now
Direct

  Mexico   Franchising   Total
Locations at beginning of period   2,463     1,431     478     130     229     4,731  
New location openings       63     2     1         66  
Acquired locations remaining open                   3     3  
Conversions       3     (3 )            
Closed locations                        
Merged with existing locations   (7 )   (108 )   (381 )           (496 )
Sold or closed with no surviving location   (3 )               (3 )   (6 )
Locations at end of period   2,453     1,389     96     131     229     4,298  
Acquired locations closed and accounts merged with existing locations                        
     
Table 15   Three Months Ended March 31, 2016
    Core U.S.  

Acceptance Now
Staffed

 

Acceptance Now
Direct

  Mexico   Franchising   Total
Locations at beginning of period   2,672     1,444     532     143     227     5,018  
New location openings       16     5             21  
Acquired locations remaining open              

         
Conversions       1     (1 )  

         
Closed locations                        
Merged with existing locations   (6 )   (25 )   (10 )   (4 )       (45 )
Sold or closed with no surviving location   (4 )           (10 )       (14 )
Locations at end of period   2,662     1,436     526     129     227     4,980  
Acquired locations closed and accounts merged with existing locations   2                     2  

Contacts:

Maureen Short
Interim Chief Financial Officer
Rent-A-Center, Inc.
Investor Relations
Rent-A-Center, Inc.
972-801-1899
maureen.short@rentacenter.com

Joele Frank
Media Relations
Wilkinson Brimmer Katcher
Kelly Sullivan / James Golden / Matt Gross / Aura Reinhard
212-355-4449

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