remain hopeful for a favorable outcome on our appeal, the
timetable remains uncertain and we have decided that closing our
remaining Pennsylvania centers at this time is in the best
interest of our stockholders.
Ken Compton, President and CEO, Advance America
Advance announced in September that it was closing 31 of its
centers in Pennsylvania in an effort to control costs and it
subsequently closed one center in October (see
story). The Company kept 66 centers open while it explored
other options and product lines for meeting customer demand in
Advance America's President and Chief Executive Officer Ken
Compton said today, "While we remain hopeful for a favorable
outcome on our appeal, the timetable remains uncertain and we
have decided that closing our remaining Pennsylvania centers at
this time is in the best interest of our stockholders."
The Company expects to record additional charges of
approximately $1.5 million for severance, lease termination, and
write-off of the undepreciated costs of fixed assets in these
centers as a result of the closings. Previously, the Company
recorded a charge of approximately $6.0 million for the write
down of related receivables, which included the impaired
receivables for the remaining 66 centers that the Company has
now decided to close.
Including these additional charges and write down of
receivables, Advance has incurred a pre-tax loss of
approximately $17 million in Pennsylvania since it ceased making
loans there in July 2007.
Advance America is the country's largest provider of payday cash
advance services with approximately 2,850 centers and 85 limited
licensees in 35 states, the United Kingdom and Canada.