Rentcash continues to move forward with the spin-off of the rental division to shareholders and has applied to Canada Revenue Agency (CRA) for a tax ruling in respect of the transaction.

Rentcash Inc (TSXV: RCS) reported revenue for the first quarter totaled $37.6 million compared to $37.7 million in the same quarter last year. Payday loan brokerage revenue increased 3% to $32.2 million from $31.4 million in the same quarter last year. Rental revenue decreased 15% to $5.4 million from $6.3 million in the first quarter last year due to the closure of rental locations. Net income for the first quarter was $3.0 million, compared to $2.5 million for the same quarter last year.

In the rent to own division, same store sales for the 60 locations open since the beginning of the first quarter last year averaged $87,000 in the first quarter this year, an improvement of 12% compared to $78,000 in the same quarter last year. Management believes that the improvement is due to initiatives over the past year including the closure of poor performing stores and the consolidation of accounts with nearby stores.

Rentcash continues to move forward with the spin-off of the rental division to shareholders and has applied to Canada Revenue Agency (CRA) for a tax ruling in respect of the transaction. Shareholder approval for the sale will be sought at the Annual General Meeting scheduled for November 28, 2007. It is anticipated that all requisite approvals will be obtained and the spin-off completed during the third quarter of fiscal 2008.

In the brokerage division, same store sales for the 331 locations open since the beginning of the first quarter of fiscal 2007 averaged $91,500 in the first quarter, a 2% increase compared to $90,000 in the same quarter last year. Rentcash believes the increase in same store sales reflect the impact of training and development activities and the renewed emphasis on growth.

Gordon Reykdal, Chairman and CEO said he was pleased with the company's improved performance. "Subsequent to a year long corporate-wide restructuring program, this quarter marks the second consecutive quarter of revenue growth in the brokerage division along with year over year improvements to the division's same store sales and store operating income."

Reykdal said the company's rent to own division continues to make improvements. "Positive strides have also been made in the rental division, positioning the division well for a successful spin-off later in the fiscal year. Same store sales and store operating income have improved relative to the same period last year. Management continues to focus on efficiency gains and has achieved improved financial performance through the closure of underperforming stores, increases in higher margin rental revenue and improved margins on product sales."

He added, "The concentration of management's efforts in recent periods on the training and development of store associates has had positive results on company performance. Early in the next calendar year, I look forward to repeating my country-wide meetings with store managers to discuss the company's strategic priorities and the effective pursuit of our goals and objectives."

Mr. Reykdal further added, "The Company has no debt, strong working capital, and a fully liquid cash position held in current accounts with major Canadian banks. This allowed us in the fourth quarter of 2007 to declare our first quarterly dividend of 2.5 cents per share and a special dividend of 7.5 cents per share. We are pleased to declare another dividend of 2.5 cents per share for the first quarter of 2008."

Fees from other brokerage services (including fees from check cashing, money transfer, payment protection, debit cards, collections and telephone re-connect services) increased to $5.0 million in the first quarter, compared to $4.3 million in the same period last year.

At the end of the quarter the Company had cash of $15.0 million and positive working capital of $9.4 million. Just over a year and a half ago, management set out to improve the Company's working capital position which was in a deficit position of $7.1 million at March 31, 2006. The change over this period represents an improvement of $16.5 million.

Expenses at $23.6 million for the first quarter were consistent with expenses of $23.7 million for the same quarter last year.

Third-party lender retention payments for the first quarter totaled $5.8 million (4.4% of loans brokered), compared to $6.2 million (4.8% of loans brokered) in the same quarter last year.

Amortization of rental assets for the quarter totaled $2.2 million (40% of rental revenue), a decrease from $2.6 million (42% of rental revenue) in the first quarter last year. The improved percentage reflects initiatives designed to increase higher margin rental revenue and improve the margin on product sales.

For the first quarter amortization of capital and intangible assets totaled $1.4 million, which was consistent with $1.3 million in the first quarter last year.

The Company's EBITA for the first quarter was $6.2 million, compared to $5.5 million in the same quarter last year. The brokerage division's EBITA decreased to $8.6 million from $8.8 million in the same quarter last year, due to the strengthening of operational and management capacity, the addition of a collection department and check cashing call centre and a significant increase in training activities. The rental division's EBITA improved to negative $294,000 from negative $671,000 in the first quarter last year. The overall EBITA also reflects a decrease in corporate costs of $689,000 compared to the first quarter last year which was caused by lower advertising and stock-based compensation expenditures.