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First Cash Financial Services Inc. Message Board

  • mentges mentges May 15, 2001 2:40 PM Flag

    .50 Rate Cut!! more to come -Go FCFS

    cost of borrowing way down - more debt retirment.

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    • Mentges,
      How much do you think will flow to the bottom line from this rate cut ? If I remember well, they had 17 millions OS so .5 should give them a boost of 85 K or 20 K per quarter. Still the comp will look good withe a rate that was 2% more important last year. Except, that these gains will not keep on going forever as the long term debt is pared downed.

      What about your perennial ex favorite eg PWN, what will be the impact ?

      For myself, I am loading with WRLD wich had last March 2000 77 millions due and now is standing at 91 millions. Their rate is floating (prime) and was a 7.87 last year.
      So a quick calculation of a rate cut of 2% since last year, give me an interest expense going down by 1.5 millions on last year balance. I take off the equation the increase in loans outstanding as some of it is offsetted by loan repayment (at 10%) and they should generate some extra margin on these extra loans outstanding. Seems to me that there is more bang for the bugs on the interst cut front.


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