UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15 (d) of the Securities Exchange Act of 1934
February
7, 2008 (February 7, 2008)
Date
of Report (Date of earliest event reported)
QC
HOLDINGS, INC.
(Exact
name of registrant as specified in its charter)
Kansas |
000-50840 |
48-1209939 |
(State or other jurisdiction of incorporation) |
(Commission file number) |
(IRS Employer Identification Number) |
9401 Indian Creek Parkway, Suite 1500 Overland Park, Kansas 66210 |
(Address of principal executive offices) |
(913) 234-5000
(Registrant’s
telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item
2.02 Results of Operations and Financial Condition.
On February 7, 2008, QC Holdings, Inc. issued a press release announcing
its financial results for the fourth quarter and year ended December 31,
2007. A copy of the press release is attached as Exhibit 99.1 to this
report and is incorporated herein by reference.
The attached press release includes three non-GAAP financial measures
that management uses and that the company believes may be useful to
investors: (i) adjusted net income, (ii) adjusted net income per share,
and (iii) adjusted EBITDA. Adjusted net income is calculated as net
income plus the after tax effect of the costs and charges associated
with activities to close an unusually high number of branches in first
quarter 2007 (the majority of which were consolidated into nearby
branches) and to terminate the de novo process on eight branches never
opened, as well as the costs and charges associated with the company’s
second quarter 2007 activities to close its eight Oregon branches due to
changes in the payday loan laws that effectively preclude the product in
that state. Adjusted EPS is calculated as adjusted net income on a fully
diluted per share basis. Adjusted EBITDA is calculated as net income
before interest, taxes, depreciation and amortization expenses, adjusted
to exclude the charges related to stock options and restricted stock
awards and non-cash gains or losses associated with property
dispositions. For the year ended December 31, 2007, the pre-tax costs
and charges associated with the Oregon branches and the unusually high
number of branch closings/consolidations in first quarter 2007 have been
excluded from the computation. Reconciliations of each of these non-GAAP
measures are included in schedules to the press release filed with this
report.
These non-GAAP financial measures are intended to supplement the
company’s financial information prepared in accordance with accounting
principles generally accepted in the United States of America (GAAP)
included in the press release by providing management and investors with
additional insight regarding results of operations. Management uses
adjusted net income in its strategic planning for the company and in
evaluating the results of operations of the company, and its
compensation committee used adjusted net income in evaluating financial
performance of the company and management in 2007. Management believes
the adjusted net income measure may be similarly useful to investors
when evaluating financial results of the company for comparable periods
because the Oregon branch closings represent the termination of
operations in an entire state, and the number of branch closings in
first quarter 2007 was unusually high (31 branches) and is not
consistent with the normal practice of evaluating and periodically
closing a handful of branches each year. Additionally, certain of these
branch closing costs represent significant non-cash charges in computing
GAAP net income. For the same reasons, management also computes and uses
adjusted earnings per share.
Management recognizes that its use of adjusted net income and adjusted
EPS, as with any non-GAAP financial measure, has various limitations,
including the fact that an adjusted item may be a normally recurring
expense for the company or may involve the actual use of cash.
Nonetheless, management believes that these adjusted net income and
adjusted EPS measures provide additional insight for investors into the
operating results and business trends of the company. A reconciliation
of adjusted net income and adjusted EPS to net income and net income per
share is included in the schedules to the press release filed with this
report.
Management also uses adjusted EBITDA as a non-GAAP performance measure.
Management regularly reviews EBITDA as it assesses its current and
prospective operating results. Management uses adjusted EBITDA in its
strategic planning for the company and in evaluating the results of
operations of the company. The compensation committee has used adjusted
EBITDA in evaluating the performance of the company and management and
in determining certain components of executive compensation, including
performance based vesting of restricted stock awards for 2007.
Management calculates adjusted EBITDA as net income before interest,
taxes, depreciation and amortization expenses, adjusted to exclude the
charges related to stock options and restricted stock awards and
non-cash gains or losses associated with property dispostions (and for
the three months and year ended December 31, 2007, the costs and charges
associated with the activities to close the Oregon branches and the
unusually high number of branch closings/consolidations in first quarter
2007). Management believes adjusted EBITDA is useful to management and
may be useful to investors because certain of the adjusted items
represent non-cash charges to net income, and certain of the adjusted
items can fluctuate significantly from period-to-period, due in part to
the timing of equity-based awards for compensation purposes.
Management recognizes that its use of adjusted EBITDA has various
limitations, including the fact that the adjusted items may be a
normally recurring expense or may involve the actual use of cash.
Nonetheless, management believes that this adjusted EBITDA measure
provides additional insight for investors into the operating results and
business trends of the company.
The information in Item 2.02 of this report and in the exhibit attached
to this report is not filed for purposes of Section 18 of the Securities
and Exchange Act of 1934, as amended, or otherwise subject to the
liabilities of that section or Sections 11 or 12(a)(2) of the Securities
Act of 1933, as amended. The information contained in this Item 2.02 and
in the accompanying exhibit is not incorporated by reference into any
filing with the SEC made by the registrant, whether made before or after
the date of this report, regardless of any general incorporation
language in that filing.
Item
9.01 Financial Statements and Exhibits.
(c) Exhibits. |
|
|
|
The following exhibit is filed as part of this report: |
Exhibit No. |
Description |
|
99.1 | QC Holdings, Inc. Press Release issued February 7, 2008, reporting the three months and year ended December 31, 2007 financial results. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
QC HOLDINGS, INC. |
|||
Date: |
February 7, 2008 |
|
|
|
|
By: |
/s/ Douglas E. Nickerson |
Name: |
Douglas E. Nickerson |
||
Title: |
Chief Financial Officer |
||
(Principal Financial and Accounting |
|||
Officer) |