EZCORP, Inc. (NASDAQ:EZPW) Q4 2022 Earnings Call Transcript

John Hecht: Okay. And then there’s — we’ve seen some of the bigger retailers domestically announced that they’ve seen customers changing their kind of purchasing behavior, you talked about bargain shopping driving some of your results. I mean, any comments there, are you seeing changes in either the borrower or the retailer behavior, the customers’ behavior at this point either for macro trends or certain things you’re doing from an execution perspective.

Lachlan Given: Look, we’re seeing the same — all of the same commentary from the big retailers that they’re really seeing a shift in demand from their customers. Our sales continue to be quite robust. It’s — I think more people are coming to buy secondhand because it’s tough out there and our margins holding up really nicely. So while we’re seeing the big box retailers every week announcing downgrades and difficult conditions. We’re just seeing particularly down Latin America as well, we’re seeing really robust sales and maintaining our margins in that target rate. So I think what’s happening is people are buying second-hand and looking for a bargain and there are also particularly young people becoming really environmentally conscious. And so buying second-hand is not only value for money, they actually think it’s cool because you are doing what’s good for the environment. So we’re quite pleased with what we’re seeing from a sales perspective.

John Hecht: Okay. And then — that’s very helpful. And then last question. I mean, your store retail margin has been very strong. I mean obviously, migrating just as kind of things normalize, but very strong. The scrap margins are a little bit more volatile. I’m sure there’s some reasons behind that, and I’m wondering if you can you talk about what are the factors that move the scrap margins on a near-term basis?

Tim Jugmans: John, the scrap margins, yes, they have moved about a little bit. Definitely diamond market has moved up and down on the scrapping side. As you’ve seen over the years, we are trying to sell much more of that jewelry in store and do much less scrapping. And so that has shifted towards probably the lower grade stuff being scrapped and the higher-grade stuff now being sold in the stores. And so those margins have come down over time and are likely to remain quite low because of that change.

Operator: We currently have no further questions, and therefore, this concludes today’s call. Thank you for joining. You may now disconnect your lines.