All of our four major product categories produced comparable revenue gains, including electronics, which improved 18% compared to 5% at the same time last year.
David Ingram, CEO, easyhome

easyhome Chairman of the Board Don Johnson (left), Vice president of U.S. Operations John Natale (center), and CEO David Ingram prepare to cut the ribbon and open the company's first U.S. location in Glens Falls, New York last month (see story)

easyhome (EH.TO), Canada's largest rent to own/leasing company, announced same store revenue growth of 8.6% for the second quarter ended June 30, 2007. Revenue increased $6.0 million to $35.0 million, up 20.7% from 2006. This is the 23rd consecutive quarter easyhome has reported comparable revenue growth.

The company incurred a $0.6 million loss from stores open less than 12 months (2006 - $0.4 million) and reported its Financial Services and U.S. Divisions lost $0.3 million (less than $0.1 million in 2006).

Commenting on the results, David Ingram, President and CEO said, "We experienced growth in customers, a higher customer spend in the quarter, and a lease portfolio that grew $282,000 during the quarter. All of our four major product categories produced comparable revenue gains, including electronics, which improved 18% compared to 5% at the same time last year."

Mr. Ingram continued, "Earnings growth was consistent with revenue change in the quarter for the comparable period. On a sequential basis, compared to quarter one, we experienced a lower performance due to higher new store losses, investment in pre-opening expense for the U.S. operation, additional financial service kiosks being opened, and a slightly higher amortization rate."

Mr. Ingram concluded, "We continue to invest our growth strategy with the opening of 8 new easyhome locations, including our first stores in New York State, U.S.A., which are off to a positive start, and the addition of an easyfinancial services kiosk. For the 2007 year, we have achieved 20.5% revenue growth, 9.8% same store revenue growth, and 12 new stores to date, compared to our guidance of 15-18%, 5-7%, and 20-24 new stores respectively (for the full year). As such, we are pleased with our momentum entering the second half."

Donald K. Johnson, Chairman of the Board, commented that, "We believe that easyhome is well positioned for above-average earnings and dividend growth for the next few years. In addition to the continuing growth potential in Canada, we are excited about the U.S. expansion strategy, having just opened our first two corporate stores in New York State, which are performing very well. Our entry into the U.S. market provides additional growth potential while limiting concerns over financial risk given that we expect that a significant portion of our growth in the U.S. will come from franchised stores modeled off the 2 corporate stores we've already opened."

easyhome will webcast it's management conference call with shareholders, analysts and portfolio managers to discuss results for the second quarter ended June 30, 2007.

Recent RTO Online Podcast Interviews with easyhome executives.

John Natale, Vice President of U.S. Operations, easyhome.

Don Johnson, Chairman of the Board, easyhome.

Call begins at 11am EST on Thursday, August 2, 2007.

Audio of the call will be broadcast live. A link to the live webcast will be available from My RTO Portfolio.

Other second quarter highlights:

- Operating income improved $1.7 million to $4.7 million from $3.0 million in 2006, an increase of 56.9% . Part of this increase is a result of improved operating leverage on the majority of it's cost lines including the change in the method of leased asset amortization that favorably impacted net income by $0.4 million.

- Net income increased $1.4 million to $2.8 million, an improvement of 100.0% . Net income in 2006 was adversely impacted by a $0.4 million future income tax expense related to reductions in future federal income tax rates. Net income for the second quarter of 2007 is up $1.0 million or 55.0% from 2006's net income, adjusted for the future tax charge.

- Diluted earnings per share of $0.26 are up $0.13 or 100% from reported diluted earnings per share in 2006 of $0.13. Diluted earnings per share for the second quarter of 2007 is up $0.09 or 52.9% from 2006's adjusted diluted earnings per share of $0.17.

- Opened 8 stores and 1 financial services kiosk.

Year-to-Date highlights are:

- Revenue increased $11.8 million or 20.5% from $57.5 million in 2006 to $69.4 million in 2007.

- Same store revenue growth of 9.8%.

- Opened 12 stores and 4 financial services kiosks.

- Net income was $6.2 million in 2007 versus $3.8 million in 2006. Net income for the first six months of 2007 was favourably impacted by improved operating leverage including a $0.8 million impact on net income of the change in method of leased asset amortization. Net income for 2007 is up $2.1 million or 49.2% from 2006's adjusted net income of $4.2 million.

- Diluted earnings per share of $0.59 in 2007 versus $0.36 in 2006. Diluted earnings per share in 2007 are up $0.19 or 47.5% from 2006's adjusted diluted earnings per share of $0.40.

The Board of Directors have approved a dividend payment of $0.07 per share payable on October 4, 2007 to the holders of common shares of record as at the close of business on September 21, 2007.