Company Overview
| Company Name |
COMMUNITY CHOICE FINANCIAL INC. |
| Company Address |
7001 POST ROAD, SUITE 200
DUBLIN, OH 43016 |
| Company Phone |
(614) 798-5900 |
| Company Website |
www.ccfi.com |
| CEO |
William E. Saunders, Jr. |
| Employees (as of 12/31/2011) |
2653 |
| State of Inc |
-- |
| Fiscal Year End |
-- |
| Status |
Withdrawn (8/23/2011) |
| Proposed Symbol |
-- |
| Exchange |
Nasdaq National Market |
| Share Price |
10.00-12.00 |
| Shares Offered |
10,666,667 |
| Offer Amount |
$147,200,004.00 |
| Total Expenses |
$2,327,220.00 |
| Shares Over Alloted |
1,600,000 |
| Shareholder Shares Offered |
-- |
| Shares Outstanding |
18,648,203 |
| Lockup Period (days) |
180 |
| Lockup Expiration |
-- |
| Quiet Period Expiration |
-- |
| CIK |
0001528061 |
We estimate that the net proceeds from this offering with respect to the shares
to be sold by us will be $106.8 million, after deducting the underwriting
discount and estimated expenses payable by us in connection with this offering,
and assuming a public offering price of $11.00 per share (the midpoint of the
price range set forth on the cover of this prospectus), assuming no exercise of
the underwriters' overallotment option.
We will not receive any of the proceeds from the sale of shares by the selling
shareholders in connection with any exercise of the underwriters' overallotment
option. However, we will receive net proceeds of approximately $2.0 million if
the underwriters exercise their overallotment option in full, prior to giving
effect to the payment of $5.2 million to management.
We intend to use the net proceeds received by us to fund acquisitions,
including the Florida Acquisition, to pay a termination fee of approximately
$5.8 million under our management agreement and for general corporate purposes,
which may include redeeming up to $39.5 million aggregate principal amount of
our 10.75% senior secured notes due 2019.
The net proceeds from the offering of the senior notes, together with the
initial borrowings under our revolving credit facility and cash on hand, were
used to retire $207.2 million of CheckSmart's outstanding debt and $74.1
million of CCCS's outstanding debt, pay a $120.6 million special dividend to
our shareholders, and pay a $4.4 million bonus to management.
We have discussions on an ongoing basis regarding possible acquisitions of
businesses complementary to our business. Although we may use a portion of the
net proceeds received by us for these kinds of possible acquisitions, no
definitive agreements or commitments in this regard currently exist.
A $1.00 increase (decrease) in the assumed initial public offering price of
$11.00 per share would increase (decrease) the net proceeds to us from this
offering by $9.9 million, assuming the number of shares offered by us, as set
forth on the cover page of this prospectus, remains the same and after
deducting the underwriting discount and estimated offering expenses payable by
us. In addition, an increase or decrease in the number of shares of our common
shares sold by us in this offering by 10% would cause the net proceeds received
by us from this offering, after deducting the estimated underwriting discount
and estimated offering expenses, to increase or decrease by approximately $10.9
million, assuming an initial offering price of $11.00 per common share, which
is the midpoint of the estimated range set forth on the cover page of this
prospectus.
The industry in which we operate is highly fragmented and very competitive. We
believe the principal competitive factors in short-term consumer lending, title
lending, check cashing and prepaid debit card services are location, customer
service, fees and the transparency of fees, convenience, range of services
offered, speed of service and confidentiality. We face intense competition and
believe each of the markets in which we operate is becoming more competitive as
these industries mature and consolidate. With respect to our short-term
consumer lending business, we compete primarily with mono-line payday lending
businesses, other check cashers and multi-line alternative financial service
providers, pawn shops, rent-to-own businesses, banks and credit unions. With
respect to our check cashing business, we compete with other check cashers and
multi-line alternative financial service providers, grocery stores, convenience
stores, banks, credit unions, and any other retailer that cashes checks, sells
money orders, provides money transfer services or offers other similar
financial services, including some big-box retailers. Some retailers cash
checks without charging a fee under limited circumstances. With respect to our
prepaid debit card services, we compete primarily with prepaid debit card
issuers, other check cashers and multi-line alternative financial service
providers, banks, credit unions, and any other retailer offering general
purpose reloadable prepaid debit cards, including some big-box retailers. Some
of our competitors, such as big-box retailers, have larger and more established
customer bases and networks of existing stores and substantially greater
financial, marketing and other resources than us.
Company Description
We are a leading retailer of alternative financial services to unbanked and
underbanked consumers through a network of 435 retail storefronts across 14
states. We focus on providing a wide range of convenient consumer financial
products and services to help customers manage their day-to-day
financial
needs, including short-term consumer loans, medium-term loans, title loans,
check cashing, prepaid debit cards, money transfers, bill payments and money
orders. Although the majority of our customers have banking relationships, we
believe that our customers use our financial services because they are
convenient, easy to understand, and in many instances, more affordable than
available alternatives.
We strive to provide customers with unparalleled customer service in a safe,
clean and welcoming environment. Our stores are located in highly visible,
accessible locations that allow customers convenient and immediate access to
our services. Our professional work environment combines high employee
performance standards, incentive-based pay and a wide array of training
programs to incentivize our employees to provide superior customer service. We
believe that this approach has enabled us to build strong customer loyalty,
putting us in a position to expand and continue to capitalize on our
innovative product offerings. As a result of our focus on store selection and
design and our efforts to provide consistent, high-quality customer service, we
have achieved per store revenue and per store Adjusted EBITDA contribution
levels that we believe substantially exceed our publicly traded peers.
We serve the large and growing market of individuals who have limited or no
access to traditional sources of consumer credit and financial services. A
study conducted by the FDIC published in 2009 indicates 25.6% of U.S.
households are either unbanked or underbanked, representing approximately 60
million adults. As traditional financial institutions increase fees for
consumer services, such as checking accounts and debit cards, and tighten
credit standards as a result of economic and other market driven developments,
consumers have looked elsewhere for less expensive and more convenient
alternatives to meet their financial needs. According to a recent Federal
Reserve Bank of New York report, total consumer credit outstanding has declined
over $1.4 trillion since its peak in the third quarter of 2008. This
contraction in the supply of consumer credit has resulted in significant unmet
demand for consumer loan products.
For the year ended December 31, 2011, we generated $306.9 million in revenue,
$16.9 million in net income and $86.8 million in Adjusted EBITDA. As of
December 31, 2011, we had $515.5 million of total assets and $61.3 million of
stockholders' equity.
Our measurement of comparable store sales growth as of December 31, 2011
includes stores which we operated for the full year of 2011 and which were open
for the full year of 2010. As of December 31, 2011 we had 280 stores included
in this measurement. These stores achieved comparable sales growth of 7.3% for
the year ended December 31, 2011 as compared to the year ended December 31,
2010.
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Community Choice Financial Inc. was formed on April 6, 2011 under the laws of
the State of Ohio by the shareholders of CheckSmart Financial Holdings Inc. to
be the holding company of CheckSmart Financial Holdings Corp. and to acquire
the ownership interests of CCCS Corporate Holdings, Inc. through a merger. CCFI
acquired CCCS through a merger on April 29, 2011. As of December 31, 2011, we
owned and operated 435 stores in 14 states. We are primarily engaged in the
business of providing consumer retail financial services and have grown from
179 stores in April 2006, when Diamond Castle purchased a majority interest in
CheckSmart.
Our corporate offices are located at 7001 Post Road, Suite 200, Dublin, Ohio
43016. Our telephone number is (614) 798-5900 and our website is located at
www.ccfi.com.
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