-=Rent-A-Center (RCII) Ends Deal to Be Acquired by Vintage Capital

Dec 18, 2018 - 

• Rent-A-Center Inc. said it terminated its roughly $800 million agreement to be acquired by Vintage Capital Management LLC after the investment firm didn’t extend the deal’s deadline.
• Investment firm says claim is invalid and it believes $800 million merger agreement remains in effect

====Rent-A-Center (RCII) to be acquired by Vintage Capital for $15 per share

Rent-A-Center (RCII) has agreed to be taken private by Vintage Capital, a private and public equity firm, in a deal valued at about $1.365 billion. Vintage will pay $15 per share of the company, which operates in the rent-to-own industry. The deal is expected to close by year-end.

The $15 price is equal to a premium of 49% over Rent-A-Center's closing price on Oct. 30, 2017, prior to the announcement that its board was evaluating its strategic options. Shares have gained 8.4% in 2018, while the S&P 500 (SPX) has gained 3.9%.

=Rent-A-Center (RCII) reported earnings on Tue 20 Feb 2018 (a/h)

PLANO, Texas (AP) _ Rent-A-Center Inc. (RCII) on Tuesday reported fourth-quarter net income of $34.8 million, after reporting a loss in the same period a year earlier.

On a per-share basis, the Plano, Texas-based company said it had net income of 65 cents. Losses, adjusted for pretax gains, came to 41 cents per share.

The results did not meet Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for a loss of 7 cents per share.

The company that leases furniture and appliances with an option to buy posted revenue of $639 million in the period, which also missed Street forecasts. Six analysts surveyed by Zacks expected $658.5 million.

For the year, the company reported net income of $6.7 million, or 12 cents per share, swinging to a profit in the period. Revenue was reported as $2.7 billion.

Rent-A-Center shares have declined 20 percent since the beginning of the year. In the final minutes of trading on Tuesday, shares hit $8.93, an increase of roughly 9 percent in the last 12 months.

=Rent-A-Center (RCII) reported earnings on Mon 30 Oct 2017 (a/h)

Rent-A-Center misses by $0.13, reports revs in-line; sequential improvements highlight 'progress on strategic plan'  

• Reports Q3 (Sep) loss of $0.15 per share, excluding items, $0.13 worse than the Capital IQ Consensus of ($0.02); revenues fell 7.2% year/year to $643.97 mln vs the $649.09 mln Capital IQ Consensus and generated $17.1 million in adjusted EBITDA.
• Consolidated same store sales improved 430 basis points versus the second quarter of 2017 due to the progress made on executing the Company's initiatives. ACCEPTANCE NOW third quarter revenues of $184.3 million decreased 5.2 percent primarily due to closures of the Company's Conn's and HHGregg locations as well as the impact from the recent hurricanes, which was partially offset by a same store sales increase of 7.9 percent.

Rent-A-Center to explore strategic and financial alternatives, suspends quarterly dividend; Chairman Steven Pepper resigns 

• The Company issued the following statement: "Rent-A-Center remains committed to taking actions that are in the best interests of the Company and all of its stockholders, as demonstrated by the commencement of what will be an extensive review of both strategic and financial alternatives. Throughout the review process, which will be overseen by the Company's directors, the Rent-A-Center management team will maintain its focus on executing the Company's comprehensive strategic plan to continue improving results across the business. We believe the efforts announced today will facilitate the Board's determination of the best path forward for maximizing value for all Company stockholders." There can be no assurance that the Board's exploration of strategic and financial alternatives will result in any particular action or any transaction being pursued, entered into or consummated, or the timing of any action or transaction. The Company does not intend to discuss or disclose developments with respect to this process unless and until the Board has approved a definitive course of action or the process is otherwise concluded. In addition, the Rent-A-Center Board has determined to suspend the Company's quarterly dividend until the process has concluded.
• The Company also announced today that Steven L. Pepper resigned from his position as director and Chairman of the Board of Rent-A-Center, with his resignation taking effect on October 31, 2017. Mr. Pepper informed the Company that he is resigning as a result of his disagreement with the Board's decision to initiate a process through which the Company will explore various strategic and financial alternatives.

=Rent-A-Center (RCII) reported earnings on Mon 1 May 2017 (a/h)

PLANO, Texas (AP) _ Rent-A-Center Inc. (RCII) on Monday reported a loss of $6.7 million in its first quarter.

On a per-share basis, the Plano, Texas-based company said it had a loss of 13 cents. Earnings, adjusted for non-recurring costs and pretax expenses, were 4 cents per share.

The results surpassed Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 1 cent per share.

The company that leases furniture and appliances with an option to buy posted revenue of $742 million in the period, which missed Street forecasts. Six analysts surveyed by Zacks expected $744 million.

Rent-A-Center shares have fallen 5 percent since the beginning of the year. In the final minutes of trading on Monday, shares hit $10.67, a drop of 27 percent in the last 12 months.

Rent-A-Center (RCII) warns of profit miss

Rent-A-Center Inc. RCII, -29.27% said Tuesday it expects third-quarter earnings per share, on both a GAAP and adjusted basis, of 5 cents to 15 cents. That's well below the FactSet EPS consensus of 39 cents. U.S. same-store sales are expected to be down about 12%.

  

Rent-A-Center sees Q3 EPS well below consensus with core US comps down 12%; cites performance issues and outages related to new POS system:

Co sees Q3 EPS $0.05-0.15 vs $0.39 Capital IQ Consensus Estimate.

• The Company estimates Core U.S. same storesales for the three months ended September 30, 2016 to be down ~12%, and Acceptance Now same store sales to be essentially flat.
• Core U.S. gross profit, as a percent of total revenue, is estimated to be flat compared to the third quarter of last year as ongoing benefits from the changes made to the Company's sourcing model were offset by a third-quarter clearance event focused on previously-rented product.
• "Following the implementation of our new point-of-sale system, we experienced system performance issues and outages that resulted in a larger than expected negative impact on Core sales," said Robert D. Davis, Chief Executive Officer of Rent-A-Center, Inc. "While we expect it to take several quarters to fully recover from the impact to the Core portfolio, system performance has improved dramatically and we have started to see early indicators of collections improvement."
• The Company recently obtained an amendment to its credit agreement which reduces the minimum Consolidated Fixed Charge Coverage Ratio from 1.75 to 1.00 to 1.50 to 1.00, beginning with the quarter ended September 30, 2016. Co will report on Oct 26.

Rent-A-Center (RCII) reported earnings on Mon 26 October 2015 (after close)

** charts before earnings **

** charts after earnings **

Rent-A-Center Inc. swung to a loss in the third quarter, largely tied to a $34.7 million charge before taxes to adjust the value of its cellphone business.

Plano, Texas-based Rent-A-Center, considered the nation's largest rent-to-own company, entered the smartphone business last year offering cellphone rentals in the U.S. with no credit check, deposit or long-term contract.

On Monday, the company said newer phones had exceeded expectations, but it had failed to clear inventory of older phones.

Shares, down 29% this year, fell 19% on the disappointing results and lowered projections for the current quarter and full year.

Rent-A-Center cut its profit projections for the fourth quarter to between 52 cents and 62 cents a share, down from 63 cents to 72 cents a share. It now projects it will end the year with a profit of $2 to $2.10 a share, compared with its earlier view of $2.05 to $2.20. In 2014, it made $1.95 a share.

Over all, the company reported a loss of $4.1 million, or eight cents a share, compared with a year-earlier profit of $25.9 million, or 49 cents a share. Excluding the write-down and other items, profit fell to 47 cents a share from 50 cents a share.

Revenue rose 3.6% to $791.6 million.

Analysts surveyed by Thomson Reuters had projected profit of 45 cents a share on $803.3 million in revenue.


Sales at existing stores rose 5.2% as its Acceptance Now and Mexico segments reported increases of 24.5% and 5%, respectively, while domestic sales fell 0.2%.