Good morning, ladies and gentlemen. Welcome to the EZCorp First Quarter Fiscal 2026 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this call may be recorded. I'd now like to turn the conference over to Sean Mansouri, the company's investor relations advisor

with Elevate IR. Please go ahead, Sean. Thank you, and good morning, everyone. During our prepared remarks, we will refer to slides which are available for viewing or download from our website at investors.easycorp.com. Before we begin, I'd like to remind everyone that this conference call, as well as the presentation slides, contains 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 or other factors that are discussed in our annual, quarterly, and other reports filed with the Securities and Exchange Commission. 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. Joining us on the call today are EZ Corp's Chief Executive Officer, Lockie Given, and Tim Jugman's Chief Financial Officer. Now I'd like to turn the call over to Lockie. Thank you, Sean, and good morning, everyone. EZ Corp is off

to an exceptional start to fiscal 2026, delivering one of the strongest quarters in our history. We achieved record first quarter revenue and PLO, along with outstanding earnings growth for our shareholders. Our team's disciplined execution and the operating leverage inherent in our platform drove more than 35% growth in both net income and EBITDA. The poor on demand environment remains highly favourable. Consumer credit conditions continue to remain challenged, particularly for lower and middle income households, as many traditional lenders continue to tighten underwriting standards. The consumers who need immediate, no-obligation access to cash born remains a fast, transparent and trusted solution. At the same time, more consumers are seeking affordable, high-quality pre-owned goods driven by value-conscious shopping and to focus on sustainability. Both sides of our business benefit from these trends. Core financial metrics were very strong across the business for the first quarter. We saw continued momentum in PLO and PSC, merchandise sales and margin, and a material increase in scrap. We ended the quarter with net earning assets of $554 million, up 17%, and our PLO to inventory ratio remains healthy at 1.2 times, reflecting discipline lending and inventory management. Subsequent to quarter end, we closed two exciting acquisitions that expand our scale and geographic reach. As we've consistently said, we will deploy capital with discipline when the right opportunities emerge, and these transactions deliver on that commitment. Our focus in the immediate term is to successfully integrate these businesses to maximise profitability and returns, and we remain excited about our active pipeline for additional M&A opportunities going forward. The first of these transactions was closed on January 2nd, with the acquisition of FoundersOne, which owns a majority interest in Simple Management Group, one of the largest porn platforms in North America. SMG operates 105 stores across 12 countries, including Florida and Puerto Rico in the U.S., Costa Rica, Panama, and various markets across the Caribbean. We first invested in Founders as a preferred equity holder back in October 2021. The transaction is immediately accretive and expands our porn footprint into 11 new countries, creating a compelling platform for future domestic and international expansion. Importantly, SMG meaningfully broadens our total addressable market. In Puerto Rico, the stores also offer auto porn and auto title loans, giving us exposure to a higher ticket, secured lending category that complements our traditional porn offering. SMG was one of the few remaining large independent pawn chains in the United States, and we're very pleased to welcome the team into our Easy Call family. On January 12th, we acquired Old Buffalo Pawn, adding 12 stores in Texas, further strengthening our position in one of our largest domestic markets. This acquisition brings an experienced local team and a strong presence in a rapidly growing market and we are excited to apply our operating playbook and capital to unlock additional value in this business. Following these two transactions, EasyCorp now operates 1,500 porn stores across 16 countries, marking a significant milestone that highlights the scale of our growing global platform. Turning to slide three, for those new to the story, the porn business resonates strongly with customers because the transaction is fundamentally customer friendly. Our loans are non-recourse, meaning customers have no obligation to repay. We don't credit check, require bank accounts, or verify employment. We don't pursue collections, and we don't report to credit bureaus. These are small, short-term transactions, typically $200 to $220 in the U.S., and $70 to $140 in Latin America, with terms ranging from 30 to 90 days. That core value proposition, together with offering great value for money second-hand goods in an environmentally responsible way where it's fun to come and shop in a pawn store have been critical in driving consistent outstanding operational and financial results for our shareholders with that i'll turn it over to tim to walk through the financial details tim thanks lachy turning slide five for the consolidated

financial results we delivered another quarter of exceptional earnings performance adjusted EBITDA rose 36% to $70.3 million, with margin expanding 260 basis points to 19%. Deluded EPS improved 34% to $0.55. These results reflect the operating leverage embedded in our model as we scale. Total revenues reached a record $374.5 million, up 17%. Improvement was broad-based, with meaningful contributions from PSC, merchandise sales and a significant increase in scrap reflecting elevated gold prices. PLO also increased 12% to $307.3 million, marking an all-time Q1, fueled by sustained consumer demand and high average loan sizes across all drug fees. PSE revenue rose 11% to $129.6 million, generally in line with PLO. On the retail side, merchandise sales climbed 10 percent to 205.2 million dollars with same store sales up seven percent merchandise margin expanded 230 basis points to 37 percent reflecting improved pricing execution and product mix scrap margins also expanded significantly from 23 percent to 34 percent as we benefited from higher gold prices rose profit of 218.9 million dollars improved 18 percent supported by contributions across all three revenue streams gna rose 9 primarily due to high incentive compensation and professional fees related to the acquisition activity with top and bottom line growth meaningfully outpacing operating expenses we're demonstrating the scalability and operating leverage inherent in our platform before i turn it to the segments i'd note a presentation change this quarter we've modified how we allocate certain administrative of expenses. These are now reported within corporate G&A rather than allocated to store expenses at the segment level. Prior periods are being recast to conform. There's no impact to operating expenses or net income, but please see slide 22 in the earnings presentations for reference. Moving to the US segment on slide six and seven, we ended the quarter with 547 stores across 19 States. Total revenues increased $37.6 million, or 16%, to $269.8 million. Roughly half of this improvement is attributed to high scrap sales, which benefited from elevated gold prices and increased jewellery purchasing activity. PLO expanded 9% to $239.9 million, with same-store PLO up 8%. Average loan size rose 12% to $231, largely due to higher prices on jewellery. Jewellery now represents 68% of US PLO, up 310 basis points. BSC improved 8% to $95.2 million, supported by same-store PLO gains. On the retail side, merchandise sales climbed 8%, with same-store sales up 7 percent merchandise margin improved 170 basis points to 38 percent jewelry scrap gross profit rose 8.6 million dollars reflecting our ability to efficiently monetize inventory in this gold price environment inventory increased 29 percent to 190.9 million dollars fueled by plo expansion higher merchandise purchases including continued growth of our low-way product as well as a decline in turnover from 2.2 times from 2.5 times. This reflects a higher mix of jewelry which naturally carries a longer sales cycle, as well as continued success of our Layway product. Layway provides customers flexible path to ownership and supports healthy sell-through and inventory velocity. In addition, jewelry that doesn't sell through retail can be monetized through scrap, providing a natural flaw on inventory risk. Despite lower terms, age general merchandise remains manageable at 3.1% of total GM inventory, or $1.7 million. We have prioritized efforts to optimize inventory, velocity, and reduced age GM. Segment EBITDA improved 28% to $73.5 million as margins expanded 260 basis points to 27%, supported by robust gross profit performance and effective expense management, with same-store expenses up 6%. Turning to Latin America on slide 8 and 9, we ended the quarter with 836 stores across four countries. During the period, we opened seven de novo stores, including five in Guatemala, one in Mexico, and one in Honduras, and acquired 14 stores in Mexico. Teller revenues rose $16.7 million, or 19%, to $104.7 million. Roughly half of this improvement is attributed to merchandise sales, reflecting solid retail execution across the region. PLO expanded 23% to $67.4 million, with same-store gains of 12%. Average loan size improved 16% to $102, 9% on a constant currency basis, largely reflecting higher jewellery prices. Jewellery now represents 47% of Latin American PLO, up 650 basis points. PC rose 18%, supported by the same-store PLO gains and contributions from new stores. Merchandise sales climbed 15%, with same stores up 8%. Merchandise margin improved 380 basis points to 34%. Inventory increased 10% to $56.1 million, viewed by PLO expansion. Importantly, inventory turnover improved to 3.1 times from 3 times. Age general merchandise increased to 3.6% of total GM inventory, representing $1.2 million. We are applying best practices to reduce age GM. Segment EBITDA improved 23% to $21.4 million and margins expanded 70 basis points to 20%, reflecting continued expansion despite a 16% rise in same-store expenses, mainly due to labour costs, including minimum wage increases. From a balance sheet perspective, a robust position of $465.9 million in unrestricted cash will enable us to fund organic expansion, pursue compelling acquisition opportunities, and thoughtfully returned capital shareholders over time. As Lucky noted, subsequent to quarter end, we completed two acquisitions that meaningfully expand our footprint. On January 2nd, we closed the SMG transaction. The transaction was funded through a conversion of existing preferred equity investments and notes receivable, plus approximately $9 million of cash, for a total consideration of approximately $64 million. This results in approximately 75% economic interest in SMG. Following the transaction, we will consolidate 100% of SMG's financial results with net income allocated to non-controlling interests reflected below the net income line. We also provided SMG with an intercompany debt facility to replace its third-party financing. This intercompany debt and associated interest will be eliminated upon consolidation. Also in January, we acquired Elbuff Loporn adding 12 stores in Texas for $27.5 million. Both transactions represent disciplined deployment of capital to drive longer-term shelter value. Looking ahead on a consolidated basis, we remain focused on expanding PLO, improved inventory efficiency and scaling operational best practices across all drug fees. Based on the current trends, we expect Q2 momentum to remain favourable. Tax refund season typically drives increased loan redemption and retail activity, and the current gold price environment continues to support elevated scrap contributions. With respect to scrap, we're not in the business of predicting gold prices, but we can say gold has continued to rise through the quarter. As long as that continues, we expect elevated scrap gross profit contributions. As we noted in the last quarter, once gold stabilizes, we'd expect approximately two quarters of elevated scrap gross profit margin before margins begin to normalize towards historical levels. On expenses, we remain disciplined. That said, we do expect sequential increase through the year as we onboard our recent acquisitions and continued scaling operational best practices across all drug fees. Our M&A pipeline remains active in the US and Latin America as we approach each opportunity with rigorous financial discipline. With 1500 stores across 16 countries, we've reached a significant scale milestone and are well positioned to capitalise on further consolidation opportunities. Now I'd like to turn back to Lockie for closing remarks.

Thanks, Tim. From a capital allocation perspective, our strategy remains consistent. Our priority is to build scale, given the significant global opportunity in Porn. We are going to do that in a disciplined way that prioritises growth and return on capital while maintaining a fiscally conservative balance sheet. We believe that this is the clearest path to generating meaningful long-term value for our shareholders. I want to extend my sincere appreciation to our team members in all of our markets. Your dedication to serving our customers with respect and professionalism is the foundation of these outstanding results. Guided by our core values of people, pawn and passion, we remain confident in our ability to scale with discipline, invest with purpose, and build on our momentum through fiscal 2026 and beyond to deliver sustained long-term value and superior returns for our shareholders. With that, Operator, we'll open the line for questions.

Thank you. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. One moment for questions. And our first question comes from Brian McNamara with Canaccord Genuity. You may proceed.

Hey, good morning, guys. Thanks for taking the questions, and congrats on another strong quarter here.

Thanks, Brian.

Good morning, Ben. Congrats on the SMG deal. I think you guys had a preferred equity interest there since, like, October of 21. I'm curious why was now the right time to kind of take a controlling stake here. To me, it sounded like you wanted to get that a little larger in terms of store count. Was it just a factor of just the bid-ask spread kind of narrowing to a point you were comfortable?

Yeah, I think there are a bunch of things, and you've named a couple of them. I think the first one was, yeah, we wanted to give John and his team the ability to really scale the business quickly using leverage. And I think after being an investor for four or five years, we were comfortable that the team had done a really good job there and I think so from an operational perspective we you know we got very very keen on the opportunity I think secondly you've got to have a willing seller and a willing buyer as well so you know on the timing side of it the deal terms came together in a way that we thought would be really beneficial long term for our shareholders so I think operationally the time was right deal terms were right and you know now we are deep into integration and partnering with John and his team on making sure that this is as good an acquisition as we think it can be that has control environment at the center of what we're doing but growth and de novo stores and you know in a whole bunch of countries that easy course never been in so you know we shared with you Brian and the whole market over the last couple of years that we thought this is the best opportunity out there for easy course so we're really excited that we've been able to solidify that for our shareholders and now get the earnings momentum throughout income statement that we'd never had

before. Great. And then just talking to you guys about capital allocation in the last few quarters, it sounded like the M&A pipeline is pretty robust. So I'm curious, after the acquisition of, you know, SMG and El Buffalo, how does that pipeline look today and any changes in your capital allocation

priorities here? No, I think we've been really consistent on that in the last couple of years. I think we are as I said in my remarks scale is our number one priority and so to your question the M&A pipeline definitely remains strong clearly we've taken the biggest one in North America or one of the biggest ones in North America out of that equation now by buying SMG but it remains strong particularly in Mexico and other Latin American countries so look you know while this opportunity I keep saying is a global one we still think there is great opportunity in the markets that we're already in and we're going to take you know we can continue with this disciplined approach to all we're doing which you know it prioritizes growth but return on capital at the same time so we're gonna you know we're gonna maintain this balance of capital allocation strategy which is scale putting money into our existing business you can see just how quickly we're growing organically and so we need to fund that and we're going to balance that with some thoughtful return to our shareholders when when we deem it appropriate so I think I think it's the same the same message it's one of balance but I think you can see from these results that prioritizing scale and growth is really working and that's what I think is delivering such fantastic return to our shareholders I think you know I think the stock's up 80 percent in the last 12 months and we're really excited about where we can go from here. We think we're phenomenally positioned for the remainder of this year. And you know, I'm just really looking forward to our team continuing to deliver on this business.

So there's an expectation that this tax season is going to be a pretty big one in terms of refunds. I think it's $1,000 more per household. Typically, you have a loan pay down in the March quarter that we really haven't seen that seasonal aspect in a few years now. How are you guys planning for that and like what's your expected what's your baseline expectation for cute

look I saw your notes but thank you for that I think Tim will Tim will make some remarks but it's you know my perspective is you read a lot about it a lot of people have very different views then you've got to segment the market right you've got to look at the lower demographic market and what you think that attack that tax return season is going to look like but from you know from a corporate perspective we are preparing for you know daily um you know what we've seen in the last few years it might be a little different tim will walk you through that but you know our focus is we can't control that all we can control is serving our customers the best we can and if tax refunds are bigger than normal then clearly we'll probably see some higher loan high loan pay down and give us the opportunity to sell some more but you know my personal view is that i'm not expecting some monumental change here for our customer demographic but i can't predict that but tim any anything you want to add yeah that's exactly how we prepare

it's you know this is a daily business uh dealing with uh customer demands uh that do change um and so the if there's extra if there is extra cash uh the team knows how to deal with it and And if there's less, the team knows how to deal with it. So they're prepared for any direction. But as Lachie said, you know, we've generally seen it in the U.S. porn business going from December to March, a, you know, 8%, 9% decrease in PLO in the last couple of years. You know, it does look like it's going to be slightly higher than that. reading various papers, which, you know, I think a few of them are really targeting to say that this lower demographic is probably not going to get as a bigger percentage, but it will be

slightly higher than probably is. Great. And then last one for me before I get back in the queue here. I'm assuming you guys are talking to new investors, just given what the stock's done over the last year. And I feel like I'm talking to a lot more new investors as it relates to the industry as well so how should investors new to the industry think about the price of gold here and any inherent risk to your business should it move meaningfully lower like what kind of buffer is typically embedded in your loan book relative to the price of the underlying commodity thank you

well thank you brian um look on your first on your first comment we're absolutely seeing a lot more uh interest activity uh in firstly in the industry and then secondly in our stock You know, we are seeing the big, active, fundamental, long-only funds showing much more interest and becoming shareholders if they hadn't been previously. They're new to the story. So I've been incredibly excited by that. I think it's been a real change over the last 12 months, and I'm very happy to see us creating some value for them. And as you know, I think the stock is fundamentally underpriced because we are, you know, we are growing so rapidly. We are fiscally conservative. We have a lot of liquidity. We have no short or medium-term debt maturity. So I think the business is set up fundamentally for a really phenomenal future. And as I said, I'm very, very happy to see these new, long-only household-named funds getting interested or buying stock. On your second question on gold, look, Tim, you want to give that one a crack?

Yep. So from a PLO perspective, the jewellery part of the business is 68% in the quarter, and in Latin America, it was 47%. Both of those are up from last year. So we do see that customers are bringing in more gold, as can be expected. So we do see with the gold price increasing, there is some it does create activity from a customer perspective where they do bring in more gold they're getting greater value for the gold they bring in and they also are bringing gold to sell so the amount that we're purchasing is also increased from a from a risk perspective you know we looking when we lend on gold we're not adjusting daily we're looking at longer term trends. So, you know, the recent up and down of the gold price in the last week, no effect whatsoever. So we're really looking at long-term trends. So we build in and also we're not lending at the rate we're going to scrap at. So there is a margin already built in to what we can do. And you can see that in our long-term sales margins. Where you do have, where we do have some upside at the moment is on the scrap margins where we lent some of the gold that we scrapping, we lent a year ago, is obviously a very different price now. And so those margins, you know, they're 25 to 35% on those scrap margins, which is a temporary nature until gold stabilizers.

Very helpful. Thank you, guys. Best of luck.

Thanks, Brian. Thank you. Our next question comes from David Sharp with Citizens Capital Markets. You may proceed.

Hi, good morning. This is Zach Oster on for David. Thanks for taking my question, and congrats on the strong quarter. I wanted to dig in a little bit on the growth side of things, you know, with the 11 new countries that are part of the SMG acquisition.

I wanted to see if we can get some additional color on the growth potential in those specific new geographies, both in the nearer term and the longer term.

Yeah, look, thanks, Zach. So there is obviously 11 new countries, but there is Florida and Puerto Rico is really where SMGs, you know, most of the SMG business or the largest part of the SMG business is in those two regions. So I think, you know, we're looking at, we do, as you say, have 11 new countries, but some of them are relatively small in the Caribbean. So what I would say to you is that Puerto Rico represents probably, at this point, the most significant opportunity for SMG. They are already probably 25, 26 stores, something like that.

29 stores.

29 stores with the potential to have, I think, significantly more there. I think that's a really strong market. and you know now that i mean we've only owned it a couple of weeks so we we are assessing the opportunities across panama costa rica and those other caribbean countries but you know this this smg team have built their careers on on de novo they built value porn in florida which is now our largest business we bought that from them in 2009 that was that was almost entirely a de novo chain that we paid $120 million for those years ago. So this is a team that is very good at DeNovo door build-out. So that's what we're looking for from them. I think we're going to do that in a disciplined and focused way, though, because it does drag earnings. But over the medium to long term, it's exactly what we need to be doing to demonstrate growth to our shareholders. So look, I think while SMG still represents a relatively small part of the EasyCorp business, I think those new markets represent some really strong opportunities I think it will be done mainly through de novos