Good morning, ladies and gentlemen. Welcome to the EZCORP Second Quarter Fiscal 2022 Earnings Call. As a reminder, this call may be recorded. I'd now like to turn the conference over to Jean Marie, Investor Relations with Three Part Advisors. Please go ahead, Jean.

Thank you and good morning, everyone. During our prepared remarks, we'll be referring to slides, which are available for viewing or download from our website at investors.ezcorp.com. Before we begin, I'd like to remind everyone that this conference call as well as the presentation slides contain certain forward-looking statements regarding the company's expected operating and financial performance for future periods. These statements are based on the company's current expectations. Actual results for future periods may differ materially from those expressed due to a number of risks and other factors that are discussed in our annual, quarterly and other reports filed with the Securities and Exchange Commission. And as noted in our presentation materials and unless otherwise identified, results are presented on an adjusted basis to remove the effect of foreign currency fluctuations and other discrete items. Attending us on the call today is EZCORP's Chief Executive Officer, Lachlan Given and Tim Jugmans, Chief Financial Officer. Now I would like to turn the call over to Lachlan Given. Lachlan?

Thanks, Jean, and good morning, everyone. Our team continues to consistently execute on the strategic plan we announced to the market at the end of fiscal 2020, evidenced by another very strong quarter of financial results. Pawn loans outstanding, a key driver of our business, increased 38% year-over-year and at its highest level ever for the second quarter. On a consolidated balance sheet basis, it has been within 4% of pre-pandemic levels. Building on an excellent quarter, EBITDA was up 61% for the second quarter. We delivered very strong net income of $16.6 million, up 75% on last year. I'm also pleased to announce that the board of directors has approved a share buyback program of up to $50 million to be executed over the next three years. We have a robust and liquid balance sheet and are confident in our ability to continue to generate strong cash flow. We have the capacity to return cash to shareholders by buying back shares at what we believe is an attractive valuation while continuing to grow the business to significant scale. Beginning on slide 3, we are a global leader in pawnbroking and retail. We operate 1,152 stores in the U.S. and Latin America and our strategic investments in adjacent businesses that expand our presence across the globe. On this slide, we talked about building shareholder value by satisfying the short-term cash needs of our customers with an industry-leading customer experience that is fueled by continuous innovation. We take pride in every one of our stores and have an intense focus on our people and the service they provide to our customers. We will continue with our disciplined approach to pawn store acquisition both in the markets in which we currently operate and other advantageous regions that allow us to expand our geographic footprint. Moving to slide four, people, pawn, and passion is our core operating theme. And it's been wholeheartedly embraced by our 6,600 team members. Our diverse team drives our success. And we've invested in training, incentives, and cultural alignment so that we can continuously improve corporate culture and retain our best talent. We strive to be the first and best choice for our customers' pawn needs. To do that we've simplified what we're asking our store teams to do every day into four key actions: developing our people, serving our customers, making pawn loans, and selling secondhand goods. This significant change in operating culture has been a critical component in driving improving results. Slide five shows our progression towards our strategic goals. And once again, I'm pleased with that consistent performance. Here, we have invested in developing our team members, and I believe we have the most passionate, productive, committed, and motivated team in the industry. We are focused on continuing to strengthen the core pawn business and are executing well on driving operational efficiencies, significant bottom line growth, and enhancing return on capital. Improving the customer experience remains a priority, and we have expanded our points-based loyalty program and online payment options for pawn loans. Turning to our key financial themes for Q2 on slide six. As mentioned, PLO, the most effective driver for revenue and earnings, was up 38% year-on-year leading to a 21% increase in PSE. The typical seasonal decrease in PLO was the lowest we have seen on record. Net revenue was up 14% year-on-year, and EBITDA was up 61%. Net income was up 75%. On slide seven, you can see the total expenses increased year-over-year primarily due to increased store count. However, the percentage of net revenues for the last 12 months' total expenses decreased from 93% to 82%. Store expenses increased year-over-year with a 14% store count increase, but as a percentage of net revenues decreased from 78% to 70%. G&A decreased by 1.4 million year-over-year, and as a percentage of net revenues, increased from 15% to 12%. On slide eight, we talk about strengthening our core with a focus on people and systems. We continue to see enthusiasm and pride at all levels of the organization, including throughout field operations, field support, and the entire support team considering it has been a difficult time for staff in general. We have added bonuses to attract new hires and introduced robust talent succession reviews and incentive plans to increase retention. We remain committed to diversity and inclusion initiatives and cultural transformation to ensure team members align with our guiding principles of leadership, customer service, accountability, respect, diversity, and sustainability. Digitization and modernization are improving process efficiency, which is providing our customers with increased options and convenience. It is also simplifying processes for our teams in the stores. On slide nine, innovation and growth are essential to our strategy. Our EZPlus loyalty program was launched in the U.S. and Mexico during Q1 and is now live in Guatemala. We have over 930,000 customers enrolled versus over 500,000 last quarter. Online extension payments grew to 15% in Q2, up from 13% in Q1. We are providing our customers with convenient options for both pawn and layaway servicing. We’ve received more than 6,000 Google reviews this quarter, averaging 4.8 stars in the U.S., and we'll be expanding Google reviews in Mexico. The customer feedback has outlined widespread appreciation for our online support enhancements, specifically live chat. Now inventory showcase testing continues with 183 stores in the U.S. and 113 stores in Mexico, offering a full e-commerce experience. This helps us capture new customers while searching for certain items becomes much more convenient. Additionally, we are very excited about the addition of a Chief Marketing Officer to our team who will drive all marketing initiatives and the execution of our digital strategy. From an inorganic perspective, we opened three de novo stores in Latin America during the quarter and acquired three stores in the Dallas area in April. We increased our stake in CCV in March and April and now own close to 41% of that business. The acquisition pipeline remains robust. We remain disciplined when evaluating opportunities and are focused on successfully integrating our recent acquisitions in an efficient and effective manner. Slide 10 outlines our ESG highlights. Core investment for the EZCORP business is that we are a significant recycler of secondhand goods in the hundreds of local neighborhoods in which we operate. We have no factories, distribution facilities, or heavy trucking. We contribute to the circular economy by extending the useful life of and recycling millions of items. This quarter, we procured over 1.5 million pre-owned items and sold approximately 1.4 million items ranging from consumer electronics, cameras, household goods, tools, musical instruments, and jewelry. We provide an essential simple, regulated, and transparent financial resource for those who are underserved by traditional sources. Diversity and inclusion remain a significant focus. And we've launched women's empowerment affinity groups in the U.S. and Latin America. Our team members now have improved global training and development programs, as well as talent reviews and succession planning processes. For district and store managers in the U.S., we launched a new long-term cash incentive program to increase retention and have enhanced the incentive programs in Latin America. I would now like to turn the call over to Tim Jugmans, our Chief Financial Officer, to provide more details on our financial results. Tim?

Thanks, Lachlan. Before discussing the results, I would like to run through the effect of the adoption which we took at the beginning of the financial year for the new accounting standards for convertible notes. This new standard uses the if-converted method to calculate diluted EPS. This method requires the numerator to be adjusted by the after-tax interest expense and assumes the notes are converted at the beginning of the period, with the resulting common shares included in the denominator. The application of the if-converted method only applies if the impact is diluted. The impact to diluted EPS is only accounted for on a prospective basis, not retroactively. This materially increases the weighted shares outstanding by 25.2 million, assuming all convertibles are converted. Slide 11 details the full calculation for FY '22 in comparison to the old method used for the FY '21 results. Our consolidated financial results are on slide 12. PLO ended the period at $172.7 million, up 38% on a year-over-year basis, which is the highest EZCORP has seen at the end of quarter two. We're now within 4% of the Q2 FY '19 same store PLO balance. PSE revenue was up 21% over last year, with growth driven by both increased same store PLO growth and acquisitions. Merchandise sales were up 16%, with margins falling back to the high end of our normal range at 38%. Our focus on selling inventory in the first 90 days has kept inventory turnover strong at 2.9 times. It was another great quarter with consolidated EBITDA of $32.1 million, up 61%. Turning to our U.S. pawn operations on slide 13, PLO rose 40%, driven by a continued focus on our pawn operating model and serving our customer needs. PSE was up 19% year-over-year, primarily driven by same store PLO growth. On the retail side of the business, merchandise sales were up 7%, with merchandise sales gross profit down to 1% due to the expected 400 basis point drop in sales margin. Even with the growth in transactions, we kept a tight hold on costs with an increase of 1% in store expenses. U.S. pawn EBITDA for the quarter was $36.4 million, up 28% on the prior year. Slide 14 focuses on our Latin American pawn operations. Segment PLO grew 31% for the second quarter, or 13% on a same store basis. As a result, PSE was up 29%, driven by higher average PLO coming from same store PLO growth as well as additional stores. Merchandise sales were up 57%, 31% on the same store basis. Merchandise sales gross profit was up 34% due to increased sales offset by margins down 600 basis points. Store expenses were up 22% year-over-year with 130 additional stores. Even with the increase in same-store transactions, we have kept same-store expenses under control, only up 1%. All these changes resulted in Latin America pawn EBITDA improving by $2.6 million, or 67%. Looking forward on a consolidated basis, we should see PLO levels continue to increase as we move beyond the effects of government stimulus to a more normal economic environment, as well as seeing the effects of our improved business model. However, given the seasonality of our business, the first half of the year is significantly stronger from an earnings perspective than the second half. These first two quarters are buoyed by higher PLO balances as well as stronger sales results than in Q3 or Q4. Q3 is the lowest earnings quarter coming off the lowest PLO balance of the year due to taxes and limited special sales opportunities. In the second half, we are likely to see further reductions in sales gross margin as inventory levels increase and discounting practices return to normal levels. Even though we have kept expense growth to a minimum in Q2, we expect that inflationary and wage pressures will continue to rise in the second half of the year. We continue to successfully execute on our strategic initiatives and are very pleased to see this coming through in the form of consistently strong financial results each quarter. We are excited to see our business return to pre-COVID levels of profitability but with a superior operating model, which has put us in an exciting position to scale the business from here. I will now turn it over to Lachlan for a few closing comments.

Thanks, Tim. We continue to execute on our strategy in the second quarter, and are extremely pleased with the excellent operating and financial results driven by our team members who continue to embrace our culture of people, pawn, and passion. I'd like to thank everyone who attended our investor day in Dallas last month. It was a great opportunity for us to spend time with you in person in the stores and to show you what a passionate and high-performance team we are building here at EZ. I also want to thank the Board of Directors for their confidence in EZ to continue to deliver consistently strong financial results, as evidenced by their approval of a three-year $50 million share buyback program. We are very excited about the business and where we can drive it from here. And with that, we'll open the call for questions.

Thank you. The first question comes from John Hecht from Jefferies. Your line is open.

Hey, guys, thanks very much for taking my questions and congratulations on a great quarter. You mentioned inflationary impacts on some of the G&A, but your costs have been very contained as a percentage of revenues recently. Just I guess, how do we balance those two things over the next few quarters, the expense base against the inflationary pressures?

Thanks, John. Yes, the inflationary pressures, we've done a good job in the first two quarters really containing that. We do think that as a percentage of net revenue will still be good. But on a dollar basis, we believe that those costs will be going up. But as a percentage of net revenue, we think the trailing 12 months that we produce in the earnings presentation will be on track with that.

Okay, that's very helpful. Thanks. Then, the PLO I mean, you guys have had a great increase in the PLO outstanding. Obviously, some of that bleed from just the normalization, and some of it is inflationary pressures. Are you seeing anything different from the customer behavior at the store level tied to inflation, or are there other factors driving some of the consumer response to what's going on in the market today?

There are a couple of things there, John. There is a little bit on inflation. Obviously, some of our customers are being affected by rising gas prices. It's also the change in our business model and our customer service at the counter has significantly increased over the past few years, especially in the U.S. The third one is I think our customers had a little bit less money during tax season because of the child tax credits that were handed out throughout the year, which meant they got slightly less of a tax return this year. So a combination of those three things is really leading to a great quarter.

Okay. And then final question. You added a few stores, I think you said in Dallas. What's the pipeline on the acquisition front and how's the overall market for you, whether it's U.S. or LATAM? What's the overall market like for potential acquisitions?

Good morning, John. Thanks for your question. Look, I think it hasn't changed quarter on quarter. It remains in both regions in the U.S. and in Latin America, relatively robust growth from a pipeline perspective. I think multiples are likely coming down, we'd like to think with the current environment and the economy, but it remains as it was last quarter, and we're still seeing some exciting opportunities in Latin America. So pretty robust.

Great. Appreciate that, guys. Thanks.

Next question is from Marla Backer from Sidoti. Your line is open.

Thank you. So just as the environment is presenting certain challenges and opportunities. When you look at your store base you've opened new stores de novo, you've opened via M&A. What about underperforming stores? Are there any stores that you see right now in the existing chain that you think might be candidates for closure?

We do. That's a good question. We do run a program looking at exactly that. And we review that very closely. None of the stores that we have at the moment, we believe are candidates for closure. There are obviously underperforming stores in a large portfolio of stores. We are doing a lot to turn those around. But that is something we do look at on a regular monthly basis to see what we're doing with underperforming stores and the way we can turn those around.

Okay. And then in terms of some of your digital initiatives, you've commented on it in the press release and you've commented in the past. You've expanded some of those initiatives to new additional markets. Can you give us a little bit more color on directionally where you see taking some of those opportunities? I mean, what you expect you might be able to do with some of those initiatives?

I think the way to think about digital is, firstly, we are restructuring our digital initiatives and strategy. But the way we think about it is that it is a primary driver of attracting new customers to our business, that's the predominant reason. Secondly, we are servicing our existing customers a lot better, quicker, and more efficiently in the way that they want to be serviced. They don't necessarily want to come to us or to extend their loan or pay their loan. So it's really a two-pronged strategy. But the thing I am most excited about is trying to attract a new customer base to what we do, particularly young people, as secondhand goods are becoming a seriously large international business where young people prefer to buy secondhand goods. I think this trend is incredibly exciting for us. And digital is where we predominantly reach those customers. So I think, yes it is very important for our existing customer base because they want to transact digitally. But really, it's also about growing the customer base across existing markets and potentially new markets as well.

Thank you.

Welcome.

There are no further questions at this time. I would now like to turn the conference back to Mr. Lachlan Given.

Thank you, operator. Thanks, everyone, for joining this morning. It's obviously a terrific quarter that we're all very proud of the team for, so thanks for joining, and we look forward to talking to you later.

Ladies and gentlemen, this concludes today's conference call. You may now disconnect.