July 1 Pawn and payday lender EZCorp Inc
said it expects to fall short of its third-quarter
profit forecast as plunging gold price crimps margins, sending
its shares down 8 percent.
The company said it would take a charge of between $21
million and $24 million in the third quarter and expects
second-half earnings to be hit by 35 cents or more.
Gold prices have been falling amid worries of the Federal
Reserve ending its stimulus plan, leading to panic selling of
the precious metal.
"We continue to have a very large and successful gold
business and expect that we will monetize more gold through our
retail sales channels where margins are substantially higher
than our scrap margins," Chief Executive Officer Paul Rothamel
EZCorp had expected to earn between 47 cents and 52 cents
for the third quarter. Analysts had expected earnings of 49
cents, according to Thomson Reuters I/B/E/S.
Shares of the company, which have declined about 26 percent
in one year, fell 8 percent to $15.57 in morning trading on the