##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from            to
 Commission File Number 000-50866
 DOLLAR FINANCIAL CORP.
 (Exact Name of Registrant as Specified in Its Charter)
 Delaware
    
    23-2636866(State or Other Jurisdiction of Incorporation or Organization)
    
    (I.R.S. Employer Identification No.)
 1436 LANCASTER AVENUE,
BERWYN, PENNSYLVANIA 19312
 610-296-3400
 None
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




---



##### 



DOLLAR FINANCIAL CORP.
INDEX
 Page No.PART I. FINANCIAL INFORMATIONItem 1. Financial StatementsInterim Consolidated Balance Sheets as of June 30, 2010 and March 31, 2011 (unaudited)
    
    
    3Interim Unaudited Consolidated Statements of Operations for the Three and Nine Months
Ended March 31, 2010 and 2011
    
    
    4Interim Consolidated Statements of Stockholders Equity as of and from June 30, 2010
to March 31, 2011 (unaudited)
    
    
    5Interim Unaudited Consolidated Statements of Cash Flows for the Nine Months Ended
March 31, 2010 and 2011
    
    
    6Notes to Interim Unaudited Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    45Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    66Item 4. Controls and Procedures
    
    
    68PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    68Item 1A. Risk Factors
    
    
    68Item 5. Other Information
    
    
    69Item 6. Exhibits
    
    
    70Signature
    
    
    71Supplemental Indenture dated December 2, 2010 between Dollar Financial U.S., Inc. and U.S. Bank National Association, as
trusteeGuarantee dated December 2, 2010 executed by Dollar Financial U.S., Inc.Rule 13a-14(a)/15d-14(a) Certification
of Chief Executive OfficerRule 13(a)-14(a)/15d-14a Certification of Executive Vice President and Chief Financial OfficerRule 13a-14(a)/15d-14(a) Certification of Senior Vice President of Finance, Corporate Controller and Chief Accounting OfficerSection 1350 Certification of Chief Executive OfficerSection 1350 Certification of Executive Vice President and Chief Financial OfficerSection 1350 Certification of Senior Vice President of Finance, Corporate Controller and Chief Accounting OfficerEX-4.1EX-4.2EX-31.1EX-31.2EX-31.3EX-32.1EX-32.2EX-32.3
  2




---



##### Table of Contents



PART 1. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 DOLLAR FINANCIAL CORP.
 
 INTERIM CONSOLIDATED BALANCE SHEETS
 (In millions, except share and per share amounts)
 June 30,
    
    
    March 31,2010
    
    
    2011(unaudited)ASSETSCurrent AssetsCash and cash equivalents
    
    $
    291.3
    
    
    $
    361.3Consumer loans, net:Consumer loans
    
    
    111.3
    
    
    
    131.6Less: Allowance for consumer loan losses
    
    
    (10.4
    )
    
    
    (13.4
    )Consumer loans, net
    
    
    100.9
    
    
    
    118.2Pawn loans
    
    
    35.5
    
    
    
    128.5Loans in default, net of an allowance of $21.8 and $29.1
    
    
    9.3
    
    
    
    10.7Other receivables
    
    
    17.1
    
    
    
    29.2Prepaid expenses and other current assets
    
    
    25.8
    
    
    
    35.3Current deferred tax asset, net of valuation allowance of $4.9 and $4.9
    
    
    1.0
    
    
    
    Total current assets
    
    
    480.9
    
    
    
    683.2Deferred tax asset, net of valuation allowance of $80.2 and $83.2
    
    
    22.6
    
    
    
    17.5Property and equipment, net of accumulated depreciation of $117.2 and $136.8
    
    
    67.5
    
    
    
    88.7Goodwill and other intangibles
    
    
    609.0
    
    
    
    728.2Debt issuance costs, net of accumulated amortization of $3.5 and $6.5
    
    
    18.7
    
    
    
    21.4Other
    
    
    15.9
    
    
    
    17.0Total Assets
    
    $
    1,214.6
    
    
    $
    1,556.0LIABILITIES AND STOCKHOLDERS EQUITYCurrent LiabilitiesAccounts payable
    
    $
    44.8
    
    
    $
    34.8Income taxes payable
    
    
    6.2
    
    
    
    7.2Accrued expenses and other liabilities
    
    
    92.6
    
    
    
    120.5Debt due within one year
    
    
    3.3
    
    
    
    158.6Current deferred tax liability
    
    
    0.3
    
    
    
    Total current liabilities
    
    
    147.2
    
    
    
    321.1Fair value of derivatives
    
    
    47.4
    
    
    
    73.1Long-term deferred tax liability
    
    
    24.0
    
    
    
    30.8Long-term debt
    
    
    725.3
    
    
    
    796.2Other non-current liabilities
    
    
    52.4
    
    
    
    58.0Stockholders equity:Common stock, $.001 par value: 100,000,000 shares authorized;
36,539,663 shares and 36,758,141 shares issued and outstanding at
June 30, 2010 and March 31, 2011, respectively
    
    
    
    
    
    
    Additional paid-in capital
    
    
    331.1
    
    
    
    335.3Accumulated deficit
    
    
    (115.5
    )
    
    
    (67.5
    )Accumulated other comprehensive income
    
    
    2.7
    
    
    
    9.5Total Dollar Financial Corp. stockholders equity
    
    
    218.3
    
    
    
    277.3Non-controlling interest
    
    
    
    
    
    
    (0.5
    )Total stockholders equity
    
    
    218.3
    
    
    
    276.8Total Liabilities and Stockholders Equity
    
    $
    1,214.6
    
    
    $
    1,556.0
  3




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
 
 INTERIM UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
 (In millions, except share and per share amounts)
 Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011Revenues:Consumer lending
    
    $
    78.1
    
    
    $
    100.7
    
    
    $
    238.3
    
    
    $
    292.0Check cashing
    
    
    37.2
    
    
    
    36.7
    
    
    
    113.6
    
    
    
    108.7Money transfer fees
    
    
    6.6
    
    
    
    7.4
    
    
    
    20.5
    
    
    
    22.5Pawn service fees and sales
    
    
    4.8
    
    
    
    16.6
    
    
    
    13.3
    
    
    
    30.1Gold sales
    
    
    13.0
    
    
    
    12.3
    
    
    
    32.0
    
    
    
    34.7Other
    
    
    23.6
    
    
    
    24.1
    
    
    
    51.8
    
    
    
    66.5Total revenues
    
    
    163.3
    
    
    
    197.8
    
    
    
    469.5
    
    
    
    554.5Operating expenses:Salaries and benefits
    
    
    39.9
    
    
    
    46.2
    
    
    
    114.3
    
    
    
    129.7Provision for loan losses
    
    
    10.2
    
    
    
    18.5
    
    
    
    34.6
    
    
    
    48.9Occupancy
    
    
    11.0
    
    
    
    13.3
    
    
    
    32.7
    
    
    
    36.9Purchased gold costs
    
    
    9.3
    
    
    
    7.5
    
    
    
    22.6
    
    
    
    22.4Depreciation
    
    
    3.4
    
    
    
    4.3
    
    
    
    10.9
    
    
    
    11.8Returned checks, net and cash shortages
    
    
    2.3
    
    
    
    2.3
    
    
    
    7.2
    
    
    
    6.2Maintenance and repairs
    
    
    3.1
    
    
    
    4.1
    
    
    
    8.8
    
    
    
    10.6Advertising
    
    
    3.9
    
    
    
    5.4
    
    
    
    12.0
    
    
    
    17.1Bank charges and armored carrier service
    
    
    3.5
    
    
    
    4.1
    
    
    
    10.4
    
    
    
    11.8Other
    
    
    12.7
    
    
    
    15.0
    
    
    
    35.5
    
    
    
    43.7Total operating expenses
    
    
    99.3
    
    
    
    120.7
    
    
    
    289.0
    
    
    
    339.1Operating margin
    
    
    64.0
    
    
    
    77.1
    
    
    
    180.5
    
    
    
    215.4Corporate and other expenses:Corporate expenses
    
    
    22.1
    
    
    
    25.2
    
    
    
    65.4
    
    
    
    74.6Other depreciation and amortization
    
    
    2.5
    
    
    
    3.1
    
    
    
    4.7
    
    
    
    8.6Interest expense, net
    
    
    21.9
    
    
    
    23.0
    
    
    
    46.4
    
    
    
    66.5Loss on extinguishment of debt
    
    
    0.7
    
    
    
    
    
    
    
    9.5
    
    
    
    Unrealized foreign exchange gain
    
    
    (15.7
    )
    
    
    (10.1
    )
    
    
    (11.8
    )
    
    
    (42.5
    )Loss on derivatives not designated as hedges
    
    
    18.6
    
    
    
    9.6
    
    
    
    21.9
    
    
    
    34.2Provision for (proceeds from) litigation settlements
    
    
    26.6
    
    
    
    0.1
    
    
    
    27.9
    
    
    
    (3.8
    )Loss on store closings
    
    
    1.6
    
    
    
    0.1
    
    
    
    3.2
    
    
    
    0.6Other expense, net
    
    
    0.3
    
    
    
    0.8
    
    
    
    1.7
    
    
    
    3.4(Loss) income before income taxes
    
    
    (14.6
    )
    
    
    25.3
    
    
    
    11.6
    
    
    
    73.8Income tax (benefit) provision
    
    
    (2.3
    )
    
    
    9.7
    
    
    
    11.5
    
    
    
    26.3Net (loss) income
    
    
    (12.3
    )
    
    
    15.6
    
    
    $
    0.1
    
    
    $
    47.5Less: Net loss attributable to non-controlling interests
    
    
    (0.1
    )
    
    
    (0.1
    )
    
    
    (0.1
    )
    
    
    (0.5
    )Net (loss) income attributable to Dollar Financial Corp.
    
    $
    (12.2
    )
    
    $
    15.7
    
    
    $
    0.2
    
    
    $
    48.0Net (loss) income per share attributable to Dollar Financial Corp.:Basic
    
    $
    (0.34
    )
    
    $
    0.43
    
    
    $
    
    
    
    $
    1.31Diluted
    
    $
    (0.34
    )
    
    $
    0.41
    
    
    $
    
    
    
    $
    1.26Weighted average shares outstanding:Basic
    
    
    36,227,304
    
    
    
    36,619,929
    
    
    
    36,096,177
    
    
    
    36,499,154Diluted
    
    
    36,227,304
    
    
    
    38,710,798
    
    
    
    37,150,926
    
    
    
    38,001,489
  4




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
 
 INTERIM UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
 (In millions, except share data)
 AccumulatedCommon Stock
    
    
    Additional
    
    
    Accumulated
    
    
    
    
    
    
    Other
    
    
    TotalOutstanding
    
    
    Paid-in
    
    
    Income
    
    
    Non-Controlling
    
    
    Comprehensive
    
    
    StockholdersShares
    
    
    Amount
    
    
    Capital
    
    
    (Deficit)
    
    
    Interest
    
    
    Income
    
    
    EquityBalance, June 30, 2010 (audited)
    
    
    36,539,466
    
    
    $
    
    
    
    $
    331.1
    
    
    $
    (115.5
    )
    
    $
    
    
    
    $
    2.7
    
    
    $
    218.3Comprehensive income:Foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3.2
    
    
    
    3.2Cash flow hedges
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3.6
    
    
    
    3.6Net income attributable to
Dollar Financial Corp.
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    48.0
    
    
    
    
    
    
    
    
    
    
    
    48.0Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    54.8Restricted stock grants
    
    
    312,361Stock options exercised
    
    
    49,176
    
    
    
    
    
    
    
    0.3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.3Vested portion of granted
restricted stock and
restricted stock units
    
    
    
    
    
    
    
    
    
    
    1.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.7Retirement of common stock
    
    
    (142,862
    )Other stock compensation
    
    
    
    
    
    
    
    
    
    
    2.2
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2.2Net loss attributable to
non-controlling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.5
    )
    
    
    
    
    
    
    (0.5
    )Balance, March 31, 2011(unaudited)
    
    
    36,758,141
    
    
    $
    
    
    
    $
    335.3
    
    
    $
    (67.5
    )
    
    $
    (0.5
    )
    
    $
    9.5
    
    
    $
    276.8
  5




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
 
 INTERIM UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In millions)
 Nine Months EndedMarch 31,2010
    
    
    2011Cash flows from operating activities:Net income
    
    $
    0.1
    
    
    $
    47.5Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization
    
    
    18.0
    
    
    
    23.2Loss on extinguishment of debt
    
    
    9.5
    
    
    
    Change in fair value of derivatives not designated as hedges
    
    
    17.1
    
    
    
    20.5Provision for loan losses
    
    
    34.6
    
    
    
    48.9Non-cash stock compensation
    
    
    4.7
    
    
    
    3.8Loss on disposal of fixed assets
    
    
    0.3
    
    
    
    0.8Unrealized foreign exchange gain
    
    
    (12.0
    )
    
    
    (42.5
    )Deferred tax provision
    
    
    (2.4
    )
    
    
    11.0Accretion of debt discount and deferred issuance costs
    
    
    9.4
    
    
    
    11.3Change in assets and liabilities (net of effect of acquisitions):(Increase) in loans and other receivables
    
    
    (46.9
    )
    
    
    (76.4
    )(Increase) in prepaid expenses and other
    
    
    (1.5
    )
    
    
    (5.3
    )Increase (decrease) in accounts payable, accrued expenses and other liabilities
    
    
    48.2
    
    
    
    (36.0
    )Net cash provided by operating activities
    
    
    79.1
    
    
    
    6.8Cash flows from investing activities:Acquisitions, net of cash acquired
    
    
    (123.8
    )
    
    
    (74.1
    )Additions to property and equipment
    
    
    (18.3
    )
    
    
    (29.5
    )Net cash used in investing activities
    
    
    (142.1
    )
    
    
    (103.6
    )Cash flows from financing activities:Proceeds from the issuance of 10.375% senior notes due 2016
    
    
    596.4
    
    
    
    Proceeds from the exercise of stock options
    
    
    1.4
    
    
    
    0.3Repayment of term loan notes
    
    
    (351.1
    )
    
    
    Other debt payments
    
    
    (7.0
    )
    
    
    Payment of convertible debt
    
    
    (32.0
    )
    
    
    Net increase in revolving credit facilities
    
    
    14.2
    
    
    
    154.2Payment of debt issuance and other costs
    
    
    (19.7
    )
    
    
    (4.3
    )Net cash provided by financing activities
    
    
    202.2
    
    
    
    150.2Effect of exchange rate changes on cash and cash equivalents
    
    
    22.2
    
    
    
    16.6Net increase in cash and cash equivalents
    
    
    161.4
    
    
    
    70.0Cash and cash equivalents at beginning of period
    
    
    209.6
    
    
    
    291.3Cash and cash equivalents at end of period
    
    $
    371.0
    
    
    $
    361.3
  6




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
 
 NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 1. Summary of Significant Accounting Policies
 Basis of Presentation
  ® ® ® ® ® ® ® ® ®
  Use of Estimates
  Principles of Consolidation
  Reclassifications
  
    
    Reclassifying $2.0 million ($9.4 million of loans and a related allowance of $7.4
million) from Consumer Loans, net, to Loans in Default, net, in the Companys Consolidated
Balance Sheet as of June 30, 2010, to conform the presentation of our Poland business to
the remainder of the Companys operations.
    
    Reclassifying $35.5 million of pawn loans from Consumer Loans, net, to Pawn Loans in
the Companys Consolidated Balance Sheet as of June 30, 2010.
 7




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 
    
    Reclassifying $7.0 million and $14.4 million of gold sales from Other Revenue, to Gold
Sales Revenue, and $7.0 million and $14.4 million of purchased gold costs from Other
Operating Expense, to Purchased Gold Costs in the Companys Consolidated Statement of
Operations for the three and nine months ended March 31, 2010, respectively. For the
three and nine months ended March 31, 2010, the previously reported amounts of gold sales
and purchased gold costs have been revised to correct certain immaterial classification
errors. Specifically charges previously netted in calculating total revenues of $6.0
million and $17.6 million, respectively, have been reclassified to operating expenses.
Accordingly, this reclassification increased other revenue, total revenue, other operating
expense, and total operating expense by $6.0 million and $17.6 million for the three and
nine months ended March 31, 2010, respectively. This reclassification did not affect the
previously reported amounts of operating margin for any period.
 Revenue Recognition
      Consumer Loans, Net
  Loans in Default
  8




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consumer Loan Loss Reserves Policy
   Fair Value of Financial Instruments
     Common Stock and Stock Split
   Earnings per Share
  9




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011Net income attributable to Dollar Financial Corp.
    
    $
    (12.2
    )
    
    $
    15.7
    
    
    $
    0.2
    
    
    $
    48.0Reconciliation of denominator:Weighted average of common shares outstanding  basic (1)
    
    
    36.2
    
    
    
    36.6
    
    
    
    36.1
    
    
    
    36.5Effect of dilutive stock options   (2)
    
    
    
    
    
    
    1.3
    
    
    
    0.6
    
    
    
    1.0Effect of unvested restricted stock and restricted stock unit grants (2)
    
    
    
    
    
    
    0.4
    
    
    
    0.5
    
    
    
    0.4Dilutive effect of convertible debt
    
    
    
    
    
    
    0.4
    
    
    
    
    
    
    
    0.1Weighted average of common shares outstanding  diluted
    
    
    36.2
    
    
    
    38.7
    
    
    
    37.2
    
    
    
    38.0
 
 (1)
    
    Excludes 0.2 and 0.1 shares of unvested restricted stock which are included in total
outstanding shares of common stock as of March 31, 2010 and 2011, respectively. The
dilutive effect of restricted stock and restricted stock units is included in the
calculation of diluted earnings per share using the treasury stock method.(2)
    
    The effect of dilutive stock options was determined under the treasury stock method. Stock Based Employee Compensation
     10




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011Expected volatility
    
    
    53.6
    %
    
    
    52.0
    %
    
    
    54.8
    %
    
    
    52.7
    %Expected life (years)
    
    
    6.0
    
    
    
    5.6
    
    
    
    5.9
    
    
    
    5.5Risk-free interest rate
    
    
    3.07
    %
    
    
    2.77
    %
    
    
    3.22
    %
    
    
    1.92
    %Expected dividends
    
    None
    
    None
    
    None
    
    NoneWeighted average fair value
    
    $
    7.56
    
    
    $
    10.23
    
    
    $
    6.41
    
    
    $
    8.33
  WeightedWeighted
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    Intrinsic ValueOptions
    
    
    Price
    
    
    Term (years)
    
    
    (in millions)Options outstanding at June 30,
2010 (1,798,522 shares exercisable)
    
    
    2,908,018
    
    
    $
    10.22
    
    
    
    7.5
    
    
    $
    9.9Granted
    
    
    84,925
    
    
    $
    16.89Exercised
    
    
    (49,175
    )
    
    $
    8.70Forfeited and expired
    
    
    (84,106
    )
    
    $
    9.49Options outstanding at March 31, 2011
    
    
    2,859,662
    
    
    $
    10.47
    
    
    
    6.7
    
    
    $
    29.4Exercisable at March 31, 2011
    
    
    2,201,111
    
    
    $
    10.43
    
    
    
    6.2
    
    
    $
    22.7
    WeightedAverageRestricted
    
    
    Grant-DateStock Awards
    
    
    Fair-ValueOutstanding at June 30, 2010
    
    
    150,843
    
    
    $
    9.66Vested
    
    
    (70,567
    )
    
    $
    9.47Outstanding at March 31, 2011
    
    
    80,276
    
    
    $
    9.82
 11




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
   WeightedRestricted
    
    
    AverageStock Unit
    
    
    Grant-DateAwards
    
    
    Fair-ValueOutstanding at June 30, 2010
    
    
    909,036
    
    
    $
    9.98Granted
    
    
    77,457
    
    
    $
    17.11Vested
    
    
    (347,844
    )
    
    $
    10.42Forfeited
    
    
    (58,286
    )
    
    $
    10.86Outstanding at March 31, 2011
    
    
    580,363
    
    
    $
    10.58
  Recent Accounting Pronouncements
 Improving Disclosures about Fair Value
Measurements. Fair Value Measurements and Disclosures
 Receivables  Disclosures about the Credit Quality
of Financing Receivables and the Allowance for Credit Losses
 Business Combinations (Topic 805) 
Disclosure of Supplementary Pro Forma Information for Business Combinations
 2. Financing Receivables
 The Company offers a variety of short-term loan products and credit services to customers who
typically cannot access other traditional sources of credit and have non-traditional loan
histories. Accordingly, the Company has implemented proprietary
predictive scoring models that are designed to limit the dollar amount of loans it offers to
customers who statistically would likely be unable to repay their loan. The Company has
instituted control mechanisms and a credit analytics function designed to manage risk in its
 12




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 consumer loan activities. Collection activities are also an important aspect of the
Companys operations, particularly with respect to its consumer loan products due to the
relatively high incidence of unpaid balances beyond stated terms. The Company operates
centralized collection centers to coordinate a consistent approach to customer service and
collections in each of its markets. The Companys risk control mechanisms include, among others,
the daily monitoring of initial return rates with respect to payments made on its consumer loan
portfolio. Because the Companys revenue from its consumer lending activities is generated
through a high volume of small-dollar financial transactions, its exposure to loss from a single
customer transaction is minimal.
 The following reflects the credit quality of the Companys loans receivable.
Generally, loans are determined to be nonperforming when they are one day past due without a
payment for short term consumer loans and one hundred eighty days past due without a payment for
longer-term (less than one year) installment loans:
 Consumer Credit Exposure
Credit Risk Profile Based on Payment Activity
(in millions)
 Consumer Loans,
    
    
    Consumer Loans,
    
    
    PawnGross
    
    
    Allowance
    
    
    LoansPerforming
    
    $
    131.6
    
    
    $
    13.4
    
    
    $
    128.5Non-performing
    
    
    39.8
    
    
    
    29.1
    
    
    
    $
    171.4
    
    
    $
    42.5
    
    
    $
    128.5
  Age Analysis of Past Due Loans Receivable
As of March 31, 2011
(in millions)
 RecordedInvestmentGreater Than 90
    
    
    
    
    
    
    
    
    
    
    Total Financing
    
    
    > 90 Days and1-30 days Past Due
    
    
    30-59 days Past Due
    
    
    60-89 days Past Due
    
    
    days Past Due
    
    
    Total Past Due
    
    
    Current
    
    
    Receivables
    
    
    AccruingConsumer Loans
    
    $
    10.6
    
    
    $
    5.7
    
    
    $
    5.6
    
    
    $
    25.0
    
    
    $
    46.9
    
    
    $
    124.5
    
    
    $
    171.4
    
    
    $
    2.0Pawn Loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    128.5
    
    
    
    128.5
    
    
    
    Total
    
    $
    10.6
    
    
    $
    5.7
    
    
    $
    5.6
    
    
    $
    25.0
    
    
    $
    46.9
    
    
    $
    253.0
    
    
    $
    299.9
    
    
    $
    2.0
  Loans Receivable on Nonaccrual Status
As of March 31, 2011
(in millions)
 Consumer Loans
    
    $
    39.8Pawn Loans
    
    
    Total
    
    $
    39.8
 13




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Three Months EndedMarch 31, 2011Allowance for Consumer Loan Losses:Balance at beginning of period
    
    $
    38.4Provision for loan losses
    
    
    18.5Charge-offs
    
    
    (19.6
    )Recoveries
    
    
    4.2Effect of foreign currency translation
    
    
    1.0Balance at end of period
    
    $
    42.5
 3. Acquisitions
       14




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Cash
    
    $
    4.0Pawn loans
    
    
    71.5Prepaid expenses and other current assets
    
    
    3.5Property and equipment
    
    
    3.0Other assets
    
    
    0.1Accounts payable
    
    
    (0.4
    )Accrued expenses and other liabilities
    
    
    (3.9
    )Debt
    
    
    (61.8
    )Other non-current liabilities
    
    
    (1.5
    )Net tangible assets acquired
    
    
    14.5Indefinite-lived intangible assets acquired
    
    
    0.3Goodwill
    
    
    75.8Total purchase price
    
    $
    90.6
      Balance at June 30, 2010
    
    $
    496.8Acquisitions:Sefina Finance AB
    
    
    75.8Canadian franchisee acquisitions
    
    
    15.0Various small acquisitions
    
    
    0.5Purchase accounting adjustments:Military Financial Services, LLC
    
    
    (1.4
    )Foreign currency translation adjustment
    
    
    26.1Balance at March 31, 2011
    
    $
    612.8
 15




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Subsequent Acquisition
  Pro forma Information
  Pro Forma ResultsThree months ended
    
    
    Nine months endedMarch 31,
    
    
    March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011(Unaudited in millions
    
    
    (Unaudited in thousands exceptexcept per share amounts)
    
    
    per share amounts)Revenue
    
    $
    190.9
    
    
    $
    227.0
    
    
    $
    565.7
    
    
    $
    653.0Net (loss) income attributable to Dollar Financial Corp.
    
    $
    (9.7
    )
    
    $
    19.5
    
    
    $
    14.0
    
    
    $
    61.9Net (loss) income per common share  basic
    
    $
    (0.27
    )
    
    $
    0.53
    
    
    $
    0.39
    
    
    $
    1.70Net (loss) income per common share  diluted
    
    $
    (0.27
    )
    
    $
    0.50
    
    
    $
    0.38
    
    
    $
    1.63
 4. Goodwill and Other Intangibles
  United States
    
    
    Dealers FinancialRetail
    
    
    Services
    
    
    Canada
    
    
    Europe
    
    
    TotalBalance at June 30, 2010
    
    $
    205.7
    
    
    $
    53.5
    
    
    $
    136.4
    
    
    $
    101.2
    
    
    $
    496.8Acquisitions and purchase accounting
adjustments
    
    
    
    
    
    
    (1.4
    )
    
    
    15.0
    
    
    
    76.3
    
    
    
    89.9Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    13.1
    
    
    
    13.0
    
    
    
    26.1Balance at March 31, 2011
    
    $
    205.7
    
    
    $
    52.1
    
    
    $
    164.5
    
    
    $
    190.5
    
    
    $
    612.8
 16




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Gross Carrying AmountJune 30,
    
    
    March 31,2010
    
    
    2011Non-amortizing intangible assets:Goodwill
    
    $
    496.8
    
    
    $
    612.8Reacquired franchise rights
    
    
    51.3
    
    
    
    56.3DFS MILES Program
    
    
    35.4
    
    
    
    35.4Tradenames
    
    
    
    
    
    
    0.3$
    583.5
    
    
    $
    704.8Amortizable intangible assets:Various contracts
    
    $
    28.7
    
    
    $
    28.7Reacquired franchise rights
    
    
    
    
    
    
    2.6Accumulated Amortization:Various contracts
    
    
    (3.2
    )
    
    
    (7.7
    )Reacquired franchise rights
    
    
    
    
    
    
    (0.2
    )Total intangible assets
    
    $
    609.0
    
    
    $
    728.2
      17




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Fiscal Year EndedJune 30,

    
    Amount2011

    
    $
    6.42012

    
    
    6.52013

    
    
    6.22014

    
    
    5.92015

    
    
    3.1$
    28.1
 5. Debt
  June 30,
    
    
    March 31,2010
    
    
    2011Revolving credit facility
    
    $
    
    
    
    $
    152.5National Money Mart Company 10.375% Senior Notes due December 15, 2016
    
    
    600.0
    
    
    
    600.0Issuance discount on 10.375% Senior Notes due 2016
    
    
    (3.3
    )
    
    
    (3.1
    )Dollar Financial Corp. 2.875% Senior Convertible Notes due 2027
    
    
    38.3
    
    
    
    40.1Dollar Financial Corp. 3.000% Senior Convertible Notes due 2028
    
    
    84.9
    
    
    
    89.3Scandinavian credit facilities
    
    
    
    
    
    
    67.1Other
    
    
    8.7
    
    
    
    8.9Total debt
    
    
    728.6
    
    
    
    954.8Less: current portion of debt
    
    
    (3.3
    )
    
    
    (158.6
    )Long-term debt
    
    $
    725.3
    
    
    $
    796.2
 Senior Notes
  Convertible Notes
 Senior Convertible Notes due 2027
  18




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
    
    
    during any calendar quarter commencing after September 30, 2007, if the closing sale
price of DFCs common stock is greater than or equal to 130% of the applicable conversion
price for at least 20 trading days in the period of 30 consecutive trading days ending on
the last day of the preceding calendar quarter;
    
    during the five day period following any five consecutive trading day period in which the
trading price of the 2027 Notes for each day of such period was less than 98.0% of the
product of the closing sale price per share of DFCs common stock on such day and the
conversion rate in effect for the 2027 Notes on each such day;
    
    if the 2027 Notes are called for redemption; or
    
    upon the occurrence of specified corporate transactions as described in the 2027
Indenture.
     Senior Convertible Notes due 2028
   19




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
   
    
    during any calendar quarter commencing after December 31, 2009, if the closing sale price
of DFCs common stock is greater than or equal to 130% of the applicable conversion price
for at least 20 trading days in the period of 30 consecutive trading days ending on the last
day of the preceding calendar quarter;
    
    during the five day period following any five consecutive trading day period in which the
trading price of the 2028 Notes for each day of such period was less than 98.0% of the
product of the closing sale price per share of DFCs common stock on such day and the
conversion rate in effect for the 2028 Notes on each such day;
    
    if the 2028 Notes are called for redemption; and at any time on or after December 31,
2026; or
    
    upon the occurrence of specified corporate transactions as described in the 2028
Indenture.
     Treatment of Convertible Notes
  Debt
 20




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  1.
    
    cash equal to the lesser of the aggregate principal amount of the Convertible Notes to be
converted ($1,000 per note) or the total conversion value; and shares of DFCs common stock
in respect of the remainder, if any, of the conversion value over the principal amount of
the Convertible Notes; or
 2.
    
    shares of DFCs common stock to the holders, calculated at the initial conversion price
which is subject to any of the conversion price adjustments discussed above.
 Earnings Per Share
 Credit Facility
 Global Revolving Credit Facility
     Prior Credit Facility
   21




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
     Scandinavian Credit Facilities
  Other Debt
   6. Fair Value Measurements
  22




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
     Assets and Liabilities Measured at Fair Value on a Recurring Basis at March 31, 2011
(in millions)
 Quoted Prices inActive Markets
    
    
    Significantfor Identical Assets
    
    
    Other
    
    
    Significantand Liabilities
    
    
    Observable
    
    
    Unobservable
    
    
    Balance at(Level 1)
    
    
    Inputs (Level 2)
    
    
    Inputs (Level 3)
    
    
    March 31, 2011AssetsDerivative financial instruments
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    LiabilitiesDerivative financial instruments
    
    $
    
    
    
    $
    73.1
    
    
    $
    
    
    
    $
    73.1Contingent consideration  Sefina acquistion
    
    $
    
    
    
    $
    
    
    
    $
    17.7
    
    
    $
    17.7
 23




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Fair ValueMeasurements UsingSignificantUnobservable InputsLevel 3Balances as of June 30, 2010
    
    $
    Contingent Consideration - Sefina acquisition
    
    
    16.6Unrealized foreign exchange loss on contingent consideration
    
    
    1.1Balance as of March 31, 2011
    
    $
    17.7
 7. Derivative Instruments and Hedging Activities
 Risk Management Objective of Using Derivatives
    Cash Flow Hedges of Foreign Exchange Risk
   Cash Flow Hedges of Multiple Risks
  24




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
     Pay Fixed Strike
    
    
    Receive Floating
    
    
    Receive FloatingForeign Currency Derivatives
    
    Pay Fixed Notional
    
    
    Rate
    
    
    Notional
    
    
    IndexUSD-CAD Cross Currency Swap
    
    CAD 181,183,832
    
    
    8.75%
    
    
    $
    157,575,000
    
    
    3 mo. LIBOR + 2.75% per annumUSD-CAD Cross Currency Swap
    
    CAD   60,661,648
    
    
    7.47%
    
    
    $
    52,525,000
    
    
    3 mo. LIBOR + 2.75% per annumUSD-CAD Cross Currency Swap
    
    CAD   82,755,525
    
    
    7.41%
    
    
    $
    71,625,000
    
    
    3 mo. LIBOR + 2.75% per annum
 Non-designated Hedges of Commodity Risk
   25




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Tabular Disclosure of Fair Values of Derivative Instruments
 Asset Derivatives
    
    
    Liability DerivativesAs of June 30, 2010
    
    
    As of June 30, 2010Balance Sheet Location
    
    
    Fair Value
    
    
    Balance Sheet Location
    
    
    Fair ValueDerivatives
not designated as
hedging
instruments:Cross Currency Swaps
    
    Derivatives
    
    $
    
    
    
    Derivatives
    
    $
    47.4Total derivatives
not designated as
hedging instruments
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    47.4
 Asset Derivatives
    
    
    
    
    
    
    Liability DerivativesAs of March 31, 2011
    
    
    
    
    
    
    As of March 31, 2011Balance Sheet Location
    
    
    Fair Value
    
    
    Balance Sheet Location
    
    
    Fair ValueDerivatives
not designated as
hedging
instruments:Commodity Options
    
    Derivatives
    
    $
    
    
    
    Derivatives
    
    $
    Cross Currency Swaps
    
    Derivatives
    
    
    
    
    
    Derivatives
    
    
    73.1Total derivatives
not designated as
hedging instruments
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    73.1
 26




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Tabular Disclosure of the Effect of Derivative Instruments on the
 Consolidated Statement of Operations for the Nine Months Ending March 31, 2010Location of Gain or
    
    Amount of Gain or(Loss) Recognized in
    
    (Loss) Recognized inAmount of Gain or
    
    
    Location of Gain or
    
    Amount of Gain or
    
    
    Income on Derivative
    
    Income on Derivative(Loss) Recognized in
    
    
    (Loss) Reclassified
    
    (Loss) Reclassified
    
    
    (Ineffective Portion
    
    (Ineffective PortionOCI on Derivative
    
    
    from Accumulated
    
    from Accumulated
    
    
    and Amount Excluded
    
    and Amount ExcludedDerivatives in Cash Flow
    
    (Effective Portion),
    
    
    OCI into Income
    
    OCI into Income
    
    
    from Effectiveness
    
    from EffectivenessHedging Relationships
    
    net of tax
    
    
    (Effective Portion)
    
    (Effective Portion)
    
    
    Testing)
    
    Testing)Commodity Options
    
    $
    
    
    
    
    
    $
    
    
    
    Other income / (expense)
    
    $
    Foreign Exchange Contracts
    
    
    
    
    
    Foreign currency gain / (loss)
    
    
    
    
    
    Other income / (expense)
    
    
    Cross Currency Swaps
    
    
    (2.7
    )
    
    Extinguishment of Debt
    
    
    (3.9
    )
    
    Other income / (expense)
    
    
    (21.9
    )Interest Expense
    
    
    (2.3
    )Tax Benefit
    
    
    1.8Total
    
    $
    (2.7
    )
    
    
    
    $
    (4.4
    )
    
    
    
    $
    (21.9
    )Tabular Disclosure of the Effect of Derivative Instruments on
the Consolidated Statement of Operations for the Nine Months Ending March 31, 2011Location of Gain or
    
    Amount of Gain or(Loss) Recognized in
    
    (Loss) Recognized inAmount of Gain or
    
    
    Location of Gain or
    
    Amount of Gain or
    
    
    Income on Derivative
    
    Income on Derivative(Loss) Recognized in
    
    
    (Loss) Reclassified
    
    (Loss) Reclassified
    
    
    (Ineffective Portion
    
    (Ineffective PortionOCI on Derivative
    
    
    from Accumulated
    
    from Accumulated
    
    
    and Amount Excluded
    
    and Amount ExcludedDerivatives in Cash Flow
    
    (Effective Portion),
    
    
    OCI into Income
    
    OCI into Income
    
    
    from Effectiveness
    
    from EffectivenessHedging Relationships
    
    net of tax
    
    
    (Effective Portion)
    
    (Effective Portion)
    
    
    Testing)
    
    Testing)Commodity Options
    
    $
    
    
    
    
    
    $
    
    
    
    Other income / (expense)
    
    $
    Cross Currency Swaps
    
    $
    
    
    
    Interest Expense
    
    $
    (4.8
    )
    
    Loss on derivatives not
 designated as  hedges
    
    $
    (34.2
    )Tax Benefit
    
    
    1.3Total
    
    $
    
    
    
    
    
    $
    (3.5
    )
    
    
    
    $
    (34.2
    )
 Credit-risk-related Contingent Features
    27




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 8. Comprehensive Income
  Three months ended
    
    
    Nine months endedMarch 31,
    
    
    March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011Net income
    
    $
    (12.3
    )
    
    $
    15.6
    
    
    $
    0.1
    
    
    $
    47.5Foreign currency translation adjustment(1)
    
    
    (18.8
    )
    
    
    7.5
    
    
    
    (11.1
    )
    
    
    3.2Fair value adjustments for derivatives, net(2)
    
    
    
    
    
    
    
    
    
    
    (2.7
    )
    
    
    Amortization of accumulated other comprehensive income
related to dedesignated cash flow hedges (3)
    
    
    1.1
    
    
    
    1.1
    
    
    
    4.5
    
    
    
    3.6Comprehensive income
    
    
    (30.0
    )
    
    
    24.2
    
    
    
    (9.2
    )
    
    
    54.3Net income (loss) applicable to non-controlling
interests
    
    
    (0.1
    )
    
    
    (0.1
    )
    
    
    (0.1
    )
    
    
    (0.5
    )Comprehensive income attributable to Dollar Financial
Corp.
    
    $
    (29.9
    )
    
    $
    24.3
    
    
    $
    (9.1
    )
    
    $
    54.8
 
 (1)
    
    The ending balance of the foreign currency translation adjustments
included in accumulated other comprehensive income on the balance sheet
were gains of $10.5 million and $17.5 million as of March 31, 2010 and
2011, respectively.(2)
    
    Net of $0.9 million of tax for the nine months ended March 31, 2010.(3)
    
    Net of $0.5 million and $0.4 million of tax for the three months ended
March 31, 2010 and 2011, respectively. For the nine months ended March
31, 2010 and 2011, the tax was $1.8 million and $1.2 million,
respectively.  9. Income Taxes
 Income Tax Provision
  28




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Deferred
    
    
    Valuation
    
    
    Net DeferredTax Asset
    
    
    Allowance
    
    
    Tax AssetBalance at June 30, 2010
    
    $
    122.8
    
    
    $
    85.0
    
    
    $
    37.8US increase/(decrease)
    
    
    0.8
    
    
    
    2.9
    
    
    
    (2.1
    )Foreign increase/(decrease)
    
    
    (5.9
    )
    
    
    0.2
    
    
    
    (6.1
    )Balance at March 31, 2011
    
    $
    117.7
    
    
    $
    88.1
    
    
    $
    29.6
      10. Contingent Liabilities
 Contingent Liabilities
  29




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
   Settled Canadian Class Actions
 Ontario Class Action
  British Columbia Class Action
  New Brunswick, Newfoundland and Nova Scotia Class Actions
  Purported Alberta Class Actions
    Purported Manitoba Class Action
  30




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Provisions for Settlement of Canadian Actions
  Other Canadian Litigation
   California Legal Proceedings
  We The People Legal Proceedings
  31




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
   11. Segment Information
   32




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (In millions)DealersUnited States
    
    
    FinancialRetail
    
    
    Services
    
    
    Canada
    
    
    Europe
    
    
    Other
    
    
    TotalAs of and for the three
months ended March 31, 2010Total assets
    
    $
    250.6
    
    
    $
    131.8
    
    
    $
    616.5
    
    
    $
    240.9
    
    
    $
    25.2
    
    
    $
    1,265.0Goodwill and other intangibles, net
    
    
    208.3
    
    
    
    115.9
    
    
    
    190.2
    
    
    
    79.2
    
    
    
    
    
    
    
    593.6Sales to unaffiliated customers:Consumer lending
    
    
    15.1
    
    
    
    
    
    
    
    36.3
    
    
    
    26.7
    
    
    
    
    
    
    
    78.1Check cashing
    
    
    14.0
    
    
    
    
    
    
    
    15.8
    
    
    
    7.4
    
    
    
    
    
    
    
    37.2Money transfer fees
    
    
    1.2
    
    
    
    
    
    
    
    3.9
    
    
    
    1.5
    
    
    
    
    
    
    
    6.6Pawn service fees and sales
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4.8
    
    
    
    
    
    
    
    4.8Gold sales
    
    
    0.1
    
    
    
    
    
    
    
    5.0
    
    
    
    7.9
    
    
    
    
    
    
    
    13.0Other
    
    
    2.7
    
    
    
    6.9
    
    
    
    10.0
    
    
    
    4.0
    
    
    
    
    
    
    
    23.6Total sales to unaffiliated customers
    
    
    33.1
    
    
    
    6.9
    
    
    
    71.0
    
    
    
    52.3
    
    
    
    
    
    
    
    163.3Provision for loan losses
    
    
    2.1
    
    
    
    
    
    
    
    3.5
    
    
    
    4.6
    
    
    
    
    
    
    
    10.2Depreciation and amortization
    
    
    0.7
    
    
    
    1.6
    
    
    
    1.7
    
    
    
    1.6
    
    
    
    0.3
    
    
    
    5.9Interest expense, net
    
    
    
    
    
    
    
    
    
    
    17.5
    
    
    
    0.4
    
    
    
    4.0
    
    
    
    21.9Loss on extinguishment of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.7
    
    
    
    0.7Unrealized foreign exchange (gain)
loss
    
    
    
    
    
    
    
    
    
    
    (16.0
    )
    
    
    0.2
    
    
    
    0.1
    
    
    
    (15.7
    )Loss on derivatives not designated
as hedges
    
    
    
    
    
    
    
    
    
    
    18.6
    
    
    
    
    
    
    
    
    
    
    
    18.6Provision for litigation settlements
    
    
    
    
    
    
    
    
    
    
    22.4
    
    
    
    
    
    
    
    4.2
    
    
    
    26.6Loss on store closings
    
    
    1.2
    
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    0.3
    
    
    
    1.6Other (income) expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    (0.8
    )
    
    
    (0.1
    )
    
    
    1.3
    
    
    
    0.3Income (loss) before income taxes
    
    
    7.2
    
    
    
    3.1
    
    
    
    (19.3
    )
    
    
    10.9
    
    
    
    (16.5
    )
    
    
    (14.6
    )Income tax (benefit) provision
    
    
    (0.4
    )
    
    
    
    
    
    
    (5.0
    )
    
    
    3.1
    
    
    
    
    
    
    
    (2.3
    )As of and for the nine months
ended March 31, 2010Sales to unaffiliated customers:Consumer lending
    
    
    51.1
    
    
    
    
    
    
    
    109.7
    
    
    
    77.5
    
    
    
    
    
    
    
    238.3Check cashing
    
    
    36.1
    
    
    
    
    
    
    
    51.4
    
    
    
    26.1
    
    
    
    
    
    
    
    113.6Money transfer fees
    
    
    3.7
    
    
    
    
    
    
    
    12.1
    
    
    
    4.7
    
    
    
    
    
    
    
    20.5Pawn service fees and sales
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13.3
    
    
    
    
    
    
    
    13.3Gold sales
    
    
    0.3
    
    
    
    
    
    
    
    7.5
    
    
    
    24.2
    
    
    
    
    
    
    
    32.0Other
    
    
    7.8
    
    
    
    7.5
    
    
    
    23.6
    
    
    
    12.4
    
    
    
    0.5
    
    
    
    51.8Total sales to unaffiliated customers
    
    
    99.0
    
    
    
    7.5
    
    
    
    204.3
    
    
    
    158.2
    
    
    
    0.5
    
    
    
    469.5Provision for loan losses
    
    
    8.9
    
    
    
    
    
    
    
    11.8
    
    
    
    13.9
    
    
    
    
    
    
    
    34.6Depreciation and amortization
    
    
    3.0
    
    
    
    1.7
    
    
    
    5.0
    
    
    
    4.8
    
    
    
    1.0
    
    
    
    15.5Interest expense, net
    
    
    
    
    
    
    
    
    
    
    29.5
    
    
    
    3.6
    
    
    
    13.3
    
    
    
    46.4Loss on extinguishment of debt
    
    
    
    
    
    
    
    
    
    
    3.6
    
    
    
    4.7
    
    
    
    1.2
    
    
    
    9.5Unrealized foreign exchange (gain)
loss
    
    
    
    
    
    
    
    
    
    
    (20.0
    )
    
    
    8.1
    
    
    
    0.1
    
    
    
    (11.8
    )Loss on derivatives not designated
as hedges
    
    
    
    
    
    
    
    
    
    
    21.9
    
    
    
    
    
    
    
    
    
    
    
    21.9Provision for litigation settlements
    
    
    
    
    
    
    
    
    
    
    22.4
    
    
    
    
    
    
    
    5.5
    
    
    
    27.9Loss on store closings
    
    
    1.4
    
    
    
    
    
    
    
    0.8
    
    
    
    
    
    
    
    1.0
    
    
    
    3.2Other (income) expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    (0.8
    )
    
    
    0.5
    
    
    
    2.1
    
    
    
    1.7Income (loss) before income taxes
    
    
    17.5
    
    
    
    3.3
    
    
    
    10.2
    
    
    
    20.3
    
    
    
    (39.7
    )
    
    
    11.6Income tax provision
    
    
    2.1
    
    
    
    
    
    
    
    3.2
    
    
    
    6.2
    
    
    
    
    
    
    
    11.5
 33




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (In millions)DealersUnited States
    
    
    FinancialRetail
    
    
    Services
    
    
    Canada
    
    
    Europe
    
    
    Other
    
    
    TotalAs of and for the three
months ended March 31, 2011Total assets
    
    $
    258.9
    
    
    $
    113.2
    
    
    $
    433.5
    
    
    $
    713.9
    
    
    $
    36.5
    
    
    $
    1,556.0Goodwill and other intangibles, net
    
    
    206.0
    
    
    
    108.4
    
    
    
    216.8
    
    
    
    197.0
    
    
    
    
    
    
    
    728.2Sales to unaffiliated customers:Consumer lending
    
    
    14.6
    
    
    
    
    
    
    
    41.8
    
    
    
    44.3
    
    
    
    
    
    
    
    100.7Check cashing
    
    
    12.9
    
    
    
    
    
    
    
    17.1
    
    
    
    6.7
    
    
    
    
    
    
    
    36.7Money transfer fees
    
    
    1.1
    
    
    
    
    
    
    
    4.4
    
    
    
    1.9
    
    
    
    
    
    
    
    7.4Pawn service fees and sales
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16.6
    
    
    
    
    
    
    
    16.6Gold sales
    
    
    0.6
    
    
    
    
    
    
    
    3.6
    
    
    
    8.1
    
    
    
    
    
    
    
    12.3Other
    
    
    3.2
    
    
    
    5.4
    
    
    
    10.9
    
    
    
    4.6
    
    
    
    
    
    
    
    24.1Total sales to unaffiliated customers
    
    
    32.4
    
    
    
    5.4
    
    
    
    77.8
    
    
    
    82.2
    
    
    
    
    
    
    
    197.8Provision for loan losses
    
    
    1.2
    
    
    
    
    
    
    
    6.6
    
    
    
    10.7
    
    
    
    
    
    
    
    18.5Depreciation and amortization
    
    
    0.6
    
    
    
    1.5
    
    
    
    2.2
    
    
    
    2.6
    
    
    
    0.5
    
    
    
    7.4Interest expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    13.2
    
    
    
    3.6
    
    
    
    6.3
    
    
    
    23.0Unrealized foreign exchange (gain)
loss
    
    
    
    
    
    
    
    
    
    
    (13.0
    )
    
    
    2.2
    
    
    
    0.7
    
    
    
    (10.1
    )Loss on derivatives not designated
as hedges
    
    
    
    
    
    
    
    
    
    
    9.6
    
    
    
    
    
    
    
    
    
    
    
    9.6Provision for litigation settlements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    0.1Loss on store (gain) closings
    
    
    0.1
    
    
    
    
    
    
    
    0.2
    
    
    
    
    
    
    
    (0.2
    )
    
    
    0.1Other (income) expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    (0.6
    )
    
    
    4.2
    
    
    
    (2.7
    )
    
    
    0.8Income (loss) before income taxes
    
    
    9.2
    
    
    
    1.2
    
    
    
    14.9
    
    
    
    8.6
    
    
    
    (8.6
    )
    
    
    25.3Income tax provision
    
    
    2.8
    
    
    
    0.1
    
    
    
    3.0
    
    
    
    3.8
    
    
    
    
    
    
    
    9.7As of and for the nine months
ended March 31, 2011Sales to unaffiliated customers:Consumer lending
    
    
    47.0
    
    
    
    
    
    
    
    126.3
    
    
    
    118.7
    
    
    
    
    
    
    
    292.0Check cashing
    
    
    32.1
    
    
    
    
    
    
    
    54.0
    
    
    
    22.6
    
    
    
    
    
    
    
    108.7Money transfer fees
    
    
    3.4
    
    
    
    
    
    
    
    13.6
    
    
    
    5.5
    
    
    
    
    
    
    
    22.5Pawn service fees and sales
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30.1
    
    
    
    
    
    
    
    30.1Gold sales
    
    
    1.6
    
    
    
    
    
    
    
    11.3
    
    
    
    21.8
    
    
    
    
    
    
    
    34.7Other
    
    
    9.1
    
    
    
    17.4
    
    
    
    24.4
    
    
    
    15.6
    
    
    
    
    
    
    
    66.5Total sales to unaffiliated customers
    
    
    93.2
    
    
    
    17.4
    
    
    
    229.6
    
    
    
    214.3
    
    
    
    
    
    
    
    554.5Provision for loan losses
    
    
    5.4
    
    
    
    
    
    
    
    15.7
    
    
    
    27.8
    
    
    
    
    
    
    
    48.9Depreciation and amortization
    
    
    2.0
    
    
    
    4.6
    
    
    
    5.7
    
    
    
    6.7
    
    
    
    1.4
    
    
    
    20.4Interest expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    48.7
    
    
    
    4.3
    
    
    
    13.6
    
    
    
    66.5Unrealized foreign exchange (gain)
loss
    
    
    
    
    
    
    
    
    
    
    (47.1
    )
    
    
    2.1
    
    
    
    2.5
    
    
    
    (42.5
    )Loss on derivatives not designated
as hedges
    
    
    
    
    
    
    
    
    
    
    34.2
    
    
    
    
    
    
    
    
    
    
    
    34.2(Proceeds from) provision for
litigation settlements
    
    
    
    
    
    
    
    
    
    
    (4.0
    )
    
    
    
    
    
    
    0.2
    
    
    
    (3.8
    )Loss (gain) on store closings
    
    
    0.3
    
    
    
    
    
    
    
    0.4
    
    
    
    
    
    
    
    (0.1
    )
    
    
    0.6Other (income) expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    (2.0
    )
    
    
    4.4
    
    
    
    1.1
    
    
    
    3.4Income (loss) before income taxes
    
    
    22.1
    
    
    
    5.2
    
    
    
    46.7
    
    
    
    32.5
    
    
    
    (32.7
    )
    
    
    73.8Income tax provision
    
    
    3.8
    
    
    
    0.4
    
    
    
    10.9
    
    
    
    11.2
    
    
    
    
    
    
    
    26.3
 34




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 12. Subsidiary Guarantor Financial Information
   
    
    be senior unsecured obligations of the applicable Guarantor;
    
    rank equal in right or payment with existing and future unsubordinated indebtedness of the applicable Guarantor;
    
    rank senior in right of payment to all existing and future subordinated indebtedness
of the applicable Guarantor; and
    
    be effectively junior to an indebtedness of such Guarantor, including indebtedness
under the Companys Global
   35




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Balance Sheets
 June 30, 2010
 (In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedCurrent AssetsCash and cash equivalents
    
    $
    5.4
    
    
    $
    218.6
    
    
    $
    18.3
    
    
    $
    49.0
    
    
    $
    
    
    
    $
    291.3Consumer loans, net
    
    
    
    
    
    
    29.8
    
    
    
    20.9
    
    
    
    50.2
    
    
    
    
    
    
    
    100.9Pawn loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35.5
    
    
    
    
    
    
    
    35.5Loans in default, net
    
    
    
    
    
    
    6.1
    
    
    
    0.6
    
    
    
    2.6
    
    
    
    
    
    
    
    9.3Other receivables
    
    
    0.4
    
    
    
    9.8
    
    
    
    1.8
    
    
    
    6.8
    
    
    
    (1.7
    )
    
    
    17.1Prepaid expenses and other current assets
    
    
    
    
    
    
    7.5
    
    
    
    3.6
    
    
    
    18.6
    
    
    
    (2.9
    )
    
    
    26.8Total current assets
    
    
    5.8
    
    
    
    271.8
    
    
    
    45.2
    
    
    
    162.7
    
    
    
    (4.6
    )
    
    
    480.9Deferred tax asset, net of valuation
allowance
    
    
    
    
    
    
    22.5
    
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    22.6Intercompany receivables
    
    
    253.0
    
    
    
    41.6
    
    
    
    
    
    
    
    
    
    
    
    (294.6
    )
    
    
    Property and equipment, net
    
    
    
    
    
    
    27.5
    
    
    
    14.4
    
    
    
    25.6
    
    
    
    
    
    
    
    67.5Goodwill and other intangibles
    
    
    
    
    
    
    182.1
    
    
    
    206.6
    
    
    
    220.3
    
    
    
    
    
    
    
    609.0Debt issuance costs, net
    
    
    1.5
    
    
    
    14.7
    
    
    
    2.4
    
    
    
    0.1
    
    
    
    
    
    
    
    18.7Investment in subsidiaries
    
    
    82.4
    
    
    
    285.9
    
    
    
    103.1
    
    
    
    
    
    
    
    (471.4
    )
    
    
    Other
    
    
    
    
    
    
    0.7
    
    
    
    12.2
    
    
    
    3.0
    
    
    
    
    
    
    
    15.9Total Assets
    
    $
    342.7
    
    
    $
    846.8
    
    
    $
    383.9
    
    
    $
    411.8
    
    
    $
    (770.6
    )
    
    $
    1,214.6Current LiabilitiesAccounts payable
    
    $
    0.3
    
    
    $
    14.2
    
    
    $
    11.8
    
    
    $
    18.5
    
    
    $
    
    
    
    $
    44.8Income taxes payable
    
    
    
    
    
    
    
    
    
    
    1.0
    
    
    
    6.9
    
    
    
    (1.7
    )
    
    
    6.2Accrued expenses and other liabilities
    
    
    0.9
    
    
    
    50.3
    
    
    
    27.8
    
    
    
    15.4
    
    
    
    (1.8
    )
    
    
    92.6Debt due within one year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3.3
    
    
    
    
    
    
    
    3.3Current deferred tax liability
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.3
    
    
    
    
    
    
    
    0.3Total current liabilities
    
    
    1.2
    
    
    
    64.5
    
    
    
    40.6
    
    
    
    44.4
    
    
    
    (3.5
    )
    
    
    147.2Fair value of derivatives
    
    
    
    
    
    
    47.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    47.4Long-term deferred tax liability
    
    
    
    
    
    
    6.7
    
    
    
    17.3
    
    
    
    
    
    
    
    
    
    
    
    24.0Long-term debt
    
    
    123.2
    
    
    
    596.7
    
    
    
    
    
    
    
    5.4
    
    
    
    
    
    
    
    725.3Intercompany payables
    
    
    
    
    
    
    
    
    
    
    232.5
    
    
    
    62.2
    
    
    
    (294.7
    )
    
    
    Other non-current liabilities
    
    
    
    
    
    
    40.6
    
    
    
    10.0
    
    
    
    1.8
    
    
    
    
    
    
    
    52.4Total liabilities
    
    
    124.4
    
    
    
    755.9
    
    
    
    300.4
    
    
    
    113.8
    
    
    
    (298.2
    )
    
    
    996.3Total Dollar Financial Corp.
stockholders equity
    
    
    218.3
    
    
    
    90.9
    
    
    
    83.5
    
    
    
    298.0
    
    
    
    (472.4
    )
    
    
    218.3Total stockholders equity
    
    
    218.3
    
    
    
    90.9
    
    
    
    83.5
    
    
    
    298.0
    
    
    
    (472.4
    )
    
    
    218.3Total Liabilities and Stockholders Equity
    
    $
    342.7
    
    
    $
    846.8
    
    
    $
    383.9
    
    
    $
    411.8
    
    
    $
    (770.6
    )
    
    $
    1,214.6
 36




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Statements Of Operations
Three Months ended March 31, 2010
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedRevenues:Consumer lending
    
    $
    
    
    
    $
    36.3
    
    
    $
    15.1
    
    
    $
    26.7
    
    
    $
    
    
    
    $
    78.1Check cashing
    
    
    
    
    
    
    15.9
    
    
    
    14.0
    
    
    
    7.3
    
    
    
    
    
    
    
    37.2Other
    
    
    
    
    
    
    18.8
    
    
    
    4.0
    
    
    
    25.2
    
    
    
    
    
    
    
    48.0Total revenues
    
    
    
    
    
    
    71.0
    
    
    
    33.1
    
    
    
    59.2
    
    
    
    
    
    
    
    163.3Operating expenses:Salaries and benefits
    
    
    
    
    
    
    14.8
    
    
    
    12.2
    
    
    
    12.9
    
    
    
    
    
    
    
    39.9Provision for loan losses
    
    
    
    
    
    
    3.5
    
    
    
    2.1
    
    
    
    4.6
    
    
    
    
    
    
    
    10.2Occupancy
    
    
    
    
    
    
    4.1
    
    
    
    3.4
    
    
    
    3.5
    
    
    
    
    
    
    
    11.0Depreciation
    
    
    
    
    
    
    1.4
    
    
    
    0.7
    
    
    
    1.3
    
    
    
    
    
    
    
    3.4Other
    
    
    
    
    
    
    14.0
    
    
    
    5.4
    
    
    
    15.4
    
    
    
    
    
    
    
    34.8Total operating expenses
    
    
    
    
    
    
    37.8
    
    
    
    23.8
    
    
    
    37.7
    
    
    
    
    
    
    
    99.3Operating margin
    
    
    
    
    
    
    33.2
    
    
    
    9.3
    
    
    
    21.5
    
    
    
    
    
    
    
    64.0Corporate and other expenses:Corporate expenses
    
    
    
    
    
    
    5.6
    
    
    
    12.5
    
    
    
    4.0
    
    
    
    
    
    
    
    22.1Intercompany charges
    
    
    
    
    
    
    4.6
    
    
    
    (6.5
    )
    
    
    1.9
    
    
    
    
    
    
    
    Other depreciation and amortization
    
    
    
    
    
    
    0.3
    
    
    
    0.3
    
    
    
    1.9
    
    
    
    
    
    
    
    2.5Interest expense, net
    
    
    3.6
    
    
    
    17.5
    
    
    
    0.4
    
    
    
    0.4
    
    
    
    
    
    
    
    21.9Loss on extingiushment of debt
    
    
    0.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.7Unrealized foreign exchange (gain) loss
    
    
    
    
    
    
    (16.0
    )
    
    
    0.1
    
    
    
    0.2
    
    
    
    
    
    
    
    (15.7
    )Loss on derivatives not designated as hedges
    
    
    
    
    
    
    18.6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18.6Provision for litigation settlements
    
    
    
    
    
    
    22.4
    
    
    
    4.2
    
    
    
    
    
    
    
    
    
    
    
    26.6Loss on store closings
    
    
    
    
    
    
    0.2
    
    
    
    1.1
    
    
    
    0.3
    
    
    
    
    
    
    
    1.6Other (income) expense, net
    
    
    
    
    
    
    (0.4
    )
    
    
    1.0
    
    
    
    (0.3
    )
    
    
    
    
    
    
    0.3(Loss) income before income taxes
    
    
    (4.3
    )
    
    
    (19.6
    )
    
    
    (3.8
    )
    
    
    13.1
    
    
    
    
    
    
    
    (14.6
    )Income tax (benefit) provision
    
    
    
    
    
    
    (5.0
    )
    
    
    (0.4
    )
    
    
    3.1
    
    
    
    
    
    
    
    (2.3
    )Net (loss) income
    
    
    (4.3
    )
    
    
    (14.6
    )
    
    
    (3.4
    )
    
    
    10.0
    
    
    
    
    
    
    
    (12.3
    )Less: Net loss attributable to
non-controlling interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    (0.1
    )Equity in net (loss) income of subsidiaries:National Money Mart Company
    
    
    (14.6
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14.6
    
    
    
    Guarantors
    
    
    (3.4
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3.4
    
    
    
    Non-guarantors
    
    
    10.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10.1
    )
    
    
    Net (loss) income attributable to Dollar
Financial Corp.
    
    $
    (12.2
    )
    
    $
    (14.6
    )
    
    $
    (3.4
    )
    
    $
    10.1
    
    
    $
    7.9
    
    
    $
    (12.2
    )
 37




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Statements Of Operations
Nine Months ended March 31, 2010
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedRevenues:Consumer lending
    
    $
    
    
    
    $
    109.7
    
    
    $
    51.1
    
    
    $
    77.5
    
    
    $
    
    
    
    $
    238.3Check cashing
    
    
    
    
    
    
    51.4
    
    
    
    36.1
    
    
    
    26.1
    
    
    
    
    
    
    
    113.6Other
    
    
    
    
    
    
    43.2
    
    
    
    11.8
    
    
    
    62.6
    
    
    
    
    
    
    
    117.6Total revenues
    
    
    
    
    
    
    204.3
    
    
    
    99.0
    
    
    
    166.2
    
    
    
    
    
    
    
    469.5Operating expenses:Salaries and benefits
    
    
    
    
    
    
    42.8
    
    
    
    37.8
    
    
    
    33.7
    
    
    
    
    
    
    
    114.3Provision for loan losses
    
    
    
    
    
    
    11.8
    
    
    
    8.9
    
    
    
    13.9
    
    
    
    
    
    
    
    34.6Occupancy
    
    
    
    
    
    
    12.0
    
    
    
    10.7
    
    
    
    10.0
    
    
    
    
    
    
    
    32.7Depreciation
    
    
    
    
    
    
    4.0
    
    
    
    3.1
    
    
    
    3.8
    
    
    
    
    
    
    
    10.9Other
    
    
    
    
    
    
    34.5
    
    
    
    17.2
    
    
    
    44.8
    
    
    
    
    
    
    
    96.5Total operating expenses
    
    
    
    
    
    
    105.1
    
    
    
    77.7
    
    
    
    106.2
    
    
    
    
    
    
    
    289.0Operating margin
    
    
    
    
    
    
    99.2
    
    
    
    21.3
    
    
    
    60.0
    
    
    
    
    
    
    
    180.5Corporate and other expenses:Corporate expenses
    
    
    
    
    
    
    15.0
    
    
    
    38.9
    
    
    
    11.5
    
    
    
    
    
    
    
    65.4Intercompany charges
    
    
    
    
    
    
    15.5
    
    
    
    (22.1
    )
    
    
    6.6
    
    
    
    
    
    
    
    Other depreciation and amortization
    
    
    
    
    
    
    1.0
    
    
    
    1.0
    
    
    
    2.7
    
    
    
    
    
    
    
    4.7Interest expense, net
    
    
    11.8
    
    
    
    29.5
    
    
    
    1.5
    
    
    
    3.6
    
    
    
    
    
    
    
    46.4Loss on extinguishment of debt
    
    
    0.5
    
    
    
    3.6
    
    
    
    0.7
    
    
    
    4.7
    
    
    
    
    
    
    
    9.5Unrealized foreign exchange (gain) loss
    
    
    
    
    
    
    (20.0
    )
    
    
    0.1
    
    
    
    8.1
    
    
    
    
    
    
    
    (11.8
    )Loss on derivatives not designated as hedges
    
    
    
    
    
    
    21.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21.9Provision for litigation settlements
    
    
    
    
    
    
    22.4
    
    
    
    5.5
    
    
    
    
    
    
    
    
    
    
    
    27.9Loss on store closings
    
    
    
    
    
    
    0.9
    
    
    
    1.4
    
    
    
    0.9
    
    
    
    
    
    
    
    3.2Gain on sale of subsidiary
    
    
    
    
    
    
    
    
    
    
    (140.0
    )
    
    
    
    
    
    
    140.0
    
    
    
    Other expense, net
    
    
    
    
    
    
    0.2
    
    
    
    1.1
    
    
    
    0.4
    
    
    
    
    
    
    
    1.7(Loss) income before income taxes
    
    
    (12.3
    )
    
    
    9.2
    
    
    
    133.2
    
    
    
    21.5
    
    
    
    (140.0
    )
    
    
    11.6Income tax (benefit) provision
    
    
    (0.3
    )
    
    
    3.2
    
    
    
    2.3
    
    
    
    6.3
    
    
    
    
    
    
    
    11.5Net (loss) income
    
    
    (12.0
    )
    
    
    6.0
    
    
    
    130.9
    
    
    
    15.2
    
    
    
    (140.0
    )
    
    
    0.1Less: Net income attributable to non-controlling
interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    (0.1
    )Equity in net income of subsidiariesNational Money Mart Company
    
    
    6.0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6.0
    )
    
    
    Guarantors
    
    
    130.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (130.9
    )
    
    
    Non-guarantors
    
    
    15.3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15.3
    )
    
    
    Net income attributable to Dollar Financial Corp.
    
    $
    140.2
    
    
    $
    6.0
    
    
    $
    130.9
    
    
    $
    15.3
    
    
    $
    (292.2
    )
    
    $
    0.2
 38




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Statements Of Cash Flows
Nine Months Ended March 31, 2010
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedCash flows from operating activities:Net income
    
    $
    140.2
    
    
    $
    6.0
    
    
    $
    130.9
    
    
    $
    15.2
    
    
    $
    (292.2
    )
    
    $
    0.1Adjustments to reconcile net income to net cash provided by
operating activities:Undistributed income of subsidiaries
    
    
    (152.2
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    152.2
    
    
    
    Depreciation and amortization
    
    
    0.6
    
    
    
    6.2
    
    
    
    4.5
    
    
    
    6.7
    
    
    
    
    
    
    
    18.0Loss on extinguishment of debt
    
    
    0.5
    
    
    
    3.6
    
    
    
    0.7
    
    
    
    4.7
    
    
    
    
    
    
    
    9.5Change in fair value of derivatives not
designated as hedges
    
    
    
    
    
    
    17.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17.1Provision for loan losses
    
    
    
    
    
    
    11.8
    
    
    
    8.9
    
    
    
    13.9
    
    
    
    
    
    
    
    34.6Non-cash stock compensation
    
    
    4.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4.7Losses on disposal of fixed assets
    
    
    
    
    
    
    0.1
    
    
    
    0.2
    
    
    
    
    
    
    
    
    
    
    
    0.3Unrealized foreign exchange (gain) loss
    
    
    
    
    
    
    (20.3
    )
    
    
    
    
    
    
    8.3
    
    
    
    
    
    
    
    (12.0
    )Deferred tax provision
    
    
    
    
    
    
    (1.1
    )
    
    
    3.6
    
    
    
    (4.9
    )
    
    
    
    
    
    
    (2.4
    )Accretion of debt discount and deferred
issuance costs
    
    
    7.0
    
    
    
    1.7
    
    
    
    
    
    
    
    0.7
    
    
    
    
    
    
    
    9.4Change in assets and liabilities
(net of effect of acquisitions):(Increase) in loans and other receivables
    
    
    
    
    
    
    (13.7
    )
    
    
    (5.0
    )
    
    
    (28.2
    )
    
    
    
    
    
    
    (46.9
    )Decrease (increase) in prepaid expenses
and other
    
    
    
    
    
    
    6.5
    
    
    
    (2.6
    )
    
    
    10.1
    
    
    
    (15.5
    )
    
    
    (1.5
    )Increase (decrease) in accounts payable,
accrued expenses
and other liabilities
    
    
    
    
    
    
    41.1
    
    
    
    (4.5
    )
    
    
    (3.9
    )
    
    
    15.5
    
    
    
    48.2Net cash provided by operating
activities
    
    
    0.8
    
    
    
    59.0
    
    
    
    136.7
    
    
    
    22.6
    
    
    
    (140.0
    )
    
    
    79.1Cash flows from investing activities:Acquisitions, net cash acquired
    
    
    
    
    
    
    
    
    
    
    (0.3
    )
    
    
    (123.5
    )
    
    
    
    
    
    
    (123.8
    )Additions to property and equipment
    
    
    
    
    
    
    (4.8
    )
    
    
    (2.6
    )
    
    
    (10.9
    )
    
    
    
    
    
    
    (18.3
    )Net decrease (increase) in due from affiliates
    
    
    32.8
    
    
    
    (228.7
    )
    
    
    (152.9
    )
    
    
    208.8
    
    
    
    140.0
    
    
    
    Net cash
provided by (used in) investing
activities
    
    
    32.8
    
    
    
    (233.5
    )
    
    
    (155.8
    )
    
    
    74.4
    
    
    
    140.0
    
    
    
    (142.1
    )Cash flows from financing activities:Proceeds from sale of 10.375% Senior Notes
due 2016
    
    
    
    
    
    
    596.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    596.4Proceeds from exercise of stock options
    
    
    1.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.4Repayment of term loan notes
    
    
    
    
    
    
    (272.6
    )
    
    
    
    
    
    
    (78.5
    )
    
    
    
    
    
    
    (351.1
    )Other debt payments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7.0
    )
    
    
    
    
    
    
    (7.0
    )Payment of convertible debt
    
    
    (32.0
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (32.0
    )Net increase in revolving credit facilities
    
    
    
    
    
    
    
    
    
    
    14.2
    
    
    
    
    
    
    
    
    
    
    
    14.2Payment of debt issuance and other costs
    
    
    (2.3
    )
    
    
    (15.6
    )
    
    
    (1.6
    )
    
    
    (0.2
    )
    
    
    
    
    
    
    (19.7
    )Net cash (used in) provided by financing
activities
    
    
    (32.9
    )
    
    
    308.2
    
    
    
    12.6
    
    
    
    (85.7
    )
    
    
    
    
    
    
    202.2Effect of exchange rate changes on cash and
cash equivalents
    
    
    
    
    
    
    26.0
    
    
    
    
    
    
    
    (3.8
    )
    
    
    
    
    
    
    22.2Net increase (decrease) in cash and cash
equivalents
    
    
    0.7
    
    
    
    159.7
    
    
    
    (6.5
    )
    
    
    7.5
    
    
    
    
    
    
    
    161.4Cash and cash equivalents balance-beginning of
period
    
    
    0.1
    
    
    
    138.4
    
    
    
    30.3
    
    
    
    40.8
    
    
    
    
    
    
    
    209.6Cash and cash equivalents balance-end of period
    
    $
    0.8
    
    
    $
    298.1
    
    
    $
    23.8
    
    
    $
    48.3
    
    
    $
    
    
    
    $
    371.0
 39




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Balance Sheets
March 31, 2011
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedCurrent AssetsCash and cash equivalents
    
    $
    0.3
    
    
    $
    88.0
    
    
    $
    31.5
    
    
    $
    241.5
    
    
    $
    
    
    
    $
    361.3Consumer loans, net
    
    
    
    
    
    
    31.0
    
    
    
    19.5
    
    
    
    67.7
    
    
    
    
    
    
    
    118.2Pawn loans, net
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    128.4
    
    
    
    
    
    
    
    128.5Loans in default, net
    
    
    
    
    
    
    5.8
    
    
    
    0.1
    
    
    
    4.8
    
    
    
    
    
    
    
    10.7Other receivables
    
    
    0.3
    
    
    
    17.0
    
    
    
    3.8
    
    
    
    8.1
    
    
    
    
    
    
    
    29.2Prepaid expenses and other current assets
    
    
    
    
    
    
    8.1
    
    
    
    6.6
    
    
    
    20.6
    
    
    
    
    
    
    
    35.3Total current assets
    
    
    0.6
    
    
    
    150.0
    
    
    
    61.5
    
    
    
    471.1
    
    
    
    
    
    
    
    683.2Deferred tax asset, net of valuation
allowance
    
    
    
    
    
    
    16.5
    
    
    
    
    
    
    
    1.0
    
    
    
    
    
    
    
    17.5Intercompany receivables
    
    
    260.2
    
    
    
    179.7
    
    
    
    
    
    
    
    
    
    
    
    (439.9
    )
    
    
    Property and equipment, net
    
    
    
    
    
    
    30.3
    
    
    
    15.6
    
    
    
    42.8
    
    
    
    
    
    
    
    88.7Goodwill and other intangibles
    
    
    
    
    
    
    216.8
    
    
    
    315.0
    
    
    
    196.4
    
    
    
    
    
    
    
    728.2Debt issuance costs, net
    
    
    1.2
    
    
    
    16.3
    
    
    
    2.0
    
    
    
    1.9
    
    
    
    
    
    
    
    21.4Investment in subsidiaries
    
    
    147.4
    
    
    
    297.2
    
    
    
    35.1
    
    
    
    
    
    
    
    (479.7
    )
    
    
    Other
    
    
    
    
    
    
    0.8
    
    
    
    16.1
    
    
    
    0.1
    
    
    
    
    
    
    
    17.0Total Assets
    
    $
    409.4
    
    
    $
    907.6
    
    
    $
    445.3
    
    
    $
    713.3
    
    
    $
    (919.6
    )
    
    $
    1,556.0Current LiabilitiesAccounts payable
    
    $
    0.6
    
    
    $
    13.4
    
    
    $
    13.3
    
    
    $
    7.5
    
    
    $
    
    
    
    $
    34.8Income taxes payable
    
    
    
    
    
    
    
    
    
    
    1.0
    
    
    
    6.2
    
    
    
    
    
    
    
    7.2Accrued expenses and other liabilities
    
    
    2.1
    
    
    
    59.1
    
    
    
    22.8
    
    
    
    36.5
    
    
    
    
    
    
    
    120.5Debt due within one year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    158.6
    
    
    
    
    
    
    
    158.6Total current liabilities
    
    
    2.7
    
    
    
    72.5
    
    
    
    37.1
    
    
    
    208.8
    
    
    
    
    
    
    
    321.1Fair value of derivatives
    
    
    
    
    
    
    73.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    73.1Long-term deferred tax liability
    
    
    
    
    
    
    7.3
    
    
    
    21.3
    
    
    
    2.2
    
    
    
    
    
    
    
    30.8Long-term debt
    
    
    129.4
    
    
    
    596.9
    
    
    
    
    
    
    
    69.9
    
    
    
    
    
    
    
    796.2Intercompany payables
    
    
    
    
    
    
    
    
    
    
    226.4
    
    
    
    213.5
    
    
    
    (439.9
    )
    
    
    Other non-current liabilities
    
    
    
    
    
    
    35.7
    
    
    
    13.1
    
    
    
    9.2
    
    
    
    
    
    
    
    58.0Total liabilities
    
    
    132.1
    
    
    
    785.5
    
    
    
    297.9
    
    
    
    503.6
    
    
    
    (439.9
    )
    
    
    1,279.2Total Dollar Financial Corp.
stockholders equity
    
    
    277.3
    
    
    
    122.1
    
    
    
    147.4
    
    
    
    210.2
    
    
    
    (479.7
    )
    
    
    277.3Non-controlling interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.5
    )
    
    
    
    
    
    
    (0.5
    )Total stockholders equity
    
    
    277.3
    
    
    
    122.1
    
    
    
    147.4
    
    
    
    209.7
    
    
    
    (479.7
    )
    
    
    276.8Total Liabilities and Stockholders Equity
    
    $
    409.4
    
    
    $
    907.6
    
    
    $
    445.3
    
    
    $
    713.3
    
    
    $
    (919.6
    )
    
    $
    1,556.0
 40




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Statements Of Operations
Three Months ended March 31, 2011
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedRevenues:Consumer lending
    
    $
    
    
    
    $
    41.8
    
    
    $
    14.7
    
    
    $
    44.2
    
    
    $
    
    
    
    $
    100.7Check cashing
    
    
    
    
    
    
    17.1
    
    
    
    12.9
    
    
    
    6.7
    
    
    
    
    
    
    
    36.7Other
    
    
    
    
    
    
    18.9
    
    
    
    10.2
    
    
    
    31.3
    
    
    
    
    
    
    
    60.4Total revenues
    
    
    
    
    
    
    77.8
    
    
    
    37.8
    
    
    
    82.2
    
    
    
    
    
    
    
    197.8Operating expenses:Salaries and benefits
    
    
    
    
    
    
    16.0
    
    
    
    12.7
    
    
    
    17.5
    
    
    
    
    
    
    
    46.2Provision for loan losses
    
    
    
    
    
    
    6.6
    
    
    
    1.2
    
    
    
    10.7
    
    
    
    
    
    
    
    18.5Occupancy
    
    
    
    
    
    
    4.8
    
    
    
    3.3
    
    
    
    5.2
    
    
    
    
    
    
    
    13.3Depreciation
    
    
    
    
    
    
    1.5
    
    
    
    0.7
    
    
    
    2.1
    
    
    
    
    
    
    
    4.3Other
    
    
    
    
    
    
    12.9
    
    
    
    6.9
    
    
    
    18.6
    
    
    
    
    
    
    
    38.4Total operating expenses
    
    
    
    
    
    
    41.8
    
    
    
    24.8
    
    
    
    54.1
    
    
    
    
    
    
    
    120.7Operating margin
    
    
    
    
    
    
    36.0
    
    
    
    13.0
    
    
    
    28.1
    
    
    
    
    
    
    
    77.1Corporate and other expenses:Corporate expenses
    
    
    
    
    
    
    5.7
    
    
    
    14.7
    
    
    
    4.8
    
    
    
    
    
    
    
    25.2Intercompany charges
    
    
    
    
    
    
    5.7
    
    
    
    (9.9
    )
    
    
    4.2
    
    
    
    
    
    
    
    Other depreciation and amortization
    
    
    
    
    
    
    0.5
    
    
    
    2.1
    
    
    
    0.5
    
    
    
    
    
    
    
    3.1Interest expense, net
    
    
    3.4
    
    
    
    13.2
    
    
    
    2.8
    
    
    
    3.6
    
    
    
    
    
    
    
    23.0Unrealized foreign exchange (gain) loss
    
    
    
    
    
    
    (13.0
    )
    
    
    0.7
    
    
    
    2.2
    
    
    
    
    
    
    
    (10.1
    )Loss on derivatives not designated as hedges
    
    
    
    
    
    
    9.6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9.6Provision for litigation settlements
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    0.1Loss (gain) on store closings
    
    
    
    
    
    
    0.2
    
    
    
    (0.1
    )
    
    
    
    
    
    
    
    
    
    
    0.1Other (income) expense, net
    
    
    
    
    
    
    (0.1
    )
    
    
    (0.3
    )
    
    
    1.2
    
    
    
    
    
    
    
    0.8(Loss) income before income taxes
    
    
    (3.4
    )
    
    
    14.2
    
    
    
    2.9
    
    
    
    11.6
    
    
    
    
    
    
    
    25.3Income tax provision
    
    
    
    
    
    
    3.0
    
    
    
    2.9
    
    
    
    3.8
    
    
    
    
    
    
    
    9.7Net (loss) income
    
    
    (3.4
    )
    
    
    11.2
    
    
    
    
    
    
    
    7.8
    
    
    
    
    
    
    
    15.6Less: Net loss attributable to non-controlling
interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    (0.1
    )Equity in net income (loss) of subsidiaries:National Money Mart Company
    
    
    11.2
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11.2
    )
    
    
    Guarantors
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Non-guarantors
    
    
    7.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7.9
    )
    
    
    Net income (loss) attributable to Dollar
Financial Corp.
    
    $
    15.7
    
    
    $
    11.2
    
    
    $
    
    
    
    $
    7.9
    
    
    $
    (19.1
    )
    
    $
    15.7
 41




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Statements Of Operations
Nine Months ended March 31, 2011
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedRevenues:Consumer lending
    
    $
    
    
    
    $
    126.3
    
    
    $
    47.0
    
    
    $
    118.7
    
    
    $
    
    
    
    $
    292.0Check cashing
    
    
    
    
    
    
    53.9
    
    
    
    32.1
    
    
    
    22.7
    
    
    
    
    
    
    
    108.7Other
    
    
    
    
    
    
    49.4
    
    
    
    31.5
    
    
    
    72.9
    
    
    
    
    
    
    
    153.8Total revenues
    
    
    
    
    
    
    229.6
    
    
    
    110.6
    
    
    
    214.3
    
    
    
    
    
    
    
    554.5Operating expenses:Salaries and benefits
    
    
    
    
    
    
    46.9
    
    
    
    38.4
    
    
    
    44.4
    
    
    
    
    
    
    
    129.7Provision for loan losses
    
    
    
    
    
    
    15.7
    
    
    
    5.4
    
    
    
    27.8
    
    
    
    
    
    
    
    48.9Occupancy
    
    
    
    
    
    
    13.6
    
    
    
    9.9
    
    
    
    13.4
    
    
    
    
    
    
    
    36.9Depreciation
    
    
    
    
    
    
    4.3
    
    
    
    2.2
    
    
    
    5.3
    
    
    
    
    
    
    
    11.8Other
    
    
    
    
    
    
    37.9
    
    
    
    19.9
    
    
    
    54.0
    
    
    
    
    
    
    
    111.8Total operating expenses
    
    
    
    
    
    
    118.4
    
    
    
    75.8
    
    
    
    144.9
    
    
    
    
    
    
    
    339.1Operating margin
    
    
    
    
    
    
    111.2
    
    
    
    34.8
    
    
    
    69.4
    
    
    
    
    
    
    
    215.4Corporate and other expenses:Corporate expenses
    
    
    
    
    
    
    17.1
    
    
    
    43.6
    
    
    
    13.9
    
    
    
    
    
    
    
    74.6Intercompany charges
    
    
    
    
    
    
    16.1
    
    
    
    (27.2
    )
    
    
    11.1
    
    
    
    
    
    
    
    Other depreciation and amortization
    
    
    
    
    
    
    1.2
    
    
    
    6.0
    
    
    
    1.4
    
    
    
    
    
    
    
    8.6Interest expense, net
    
    
    10.2
    
    
    
    48.6
    
    
    
    3.4
    
    
    
    4.3
    
    
    
    
    
    
    
    66.5Unrealized foreign exchange (gain) loss
    
    
    
    
    
    
    (47.1
    )
    
    
    2.5
    
    
    
    2.1
    
    
    
    
    
    
    
    (42.5
    )Loss on derivatives not designated as hedges
    
    
    
    
    
    
    34.2
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34.2(Proceeds from) provision for litigation settlements
    
    
    
    
    
    
    (4.0
    )
    
    
    0.2
    
    
    
    
    
    
    
    
    
    
    
    (3.8
    )Loss on store closings
    
    
    
    
    
    
    0.4
    
    
    
    0.2
    
    
    
    
    
    
    
    
    
    
    
    0.6Other (income) expense, net
    
    
    
    
    
    
    (0.4
    )
    
    
    (0.6
    )
    
    
    4.4
    
    
    
    
    
    
    
    3.4(Loss) income before income taxes
    
    
    (10.2
    )
    
    
    45.1
    
    
    
    6.7
    
    
    
    32.2
    
    
    
    
    
    
    
    73.8Income tax provision
    
    
    
    
    
    
    11.0
    
    
    
    4.2
    
    
    
    11.1
    
    
    
    
    
    
    
    26.3Net (loss) income
    
    
    (10.2
    )
    
    
    34.1
    
    
    
    2.5
    
    
    
    21.1
    
    
    
    
    
    
    
    47.5Less: Net loss attributable to non-controlling
interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.5
    )
    
    
    
    
    
    
    (0.5
    )Equity in net income (loss) of subsidiaries:National Money Mart Company
    
    
    34.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (34.1
    )
    
    
    Guarantors
    
    
    2.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2.5
    )
    
    
    Non-guarantors
    
    
    21.6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21.6
    )
    
    
    Net income (loss) attributable to Dollar Financial
Corp.
    
    $
    48.0
    
    
    $
    34.1
    
    
    $
    2.5
    
    
    $
    21.6
    
    
    $
    (58.2
    )
    
    $
    48.0
 42




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Consolidating Condensed Statements Of Cash Flows
Nine Months Ended March 31, 2011
(In millions)
 Dollar
    
    
    National
    
    
    DFGFinancial
    
    
    Money Mart
    
    
    and
    
    
    Non-Corp.
    
    
    Company
    
    
    Guarantors
    
    
    Guarantors
    
    
    Eliminations
    
    
    ConsolidatedCash flows from operating activities:Net income
    
    $
    48.0
    
    
    $
    34.1
    
    
    $
    2.5
    
    
    $
    21.1
    
    
    $
    (58.2
    )
    
    $
    47.5Adjustments to reconcile net income to net
cash provided by (used in) operating
activities:Undistributed income of subsidiaries
    
    
    (58.2
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    58.2
    
    
    
    Depreciation and amortization
    
    
    0.6
    
    
    
    7.3
    
    
    
    8.7
    
    
    
    6.6
    
    
    
    
    
    
    
    23.2Change in fair value of derivative not
designated as a hedge
    
    
    
    
    
    
    20.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20.5Provision for loan losses
    
    
    
    
    
    
    15.7
    
    
    
    5.4
    
    
    
    27.8
    
    
    
    
    
    
    
    48.9Non-cash stock compensation
    
    
    3.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3.8Losses on disposal of fixed assets
    
    
    
    
    
    
    0.2
    
    
    
    0.6
    
    
    
    
    
    
    
    
    
    
    
    0.8Unrealized foreign exchange (gain) loss
    
    
    
    
    
    
    (47.1
    )
    
    
    
    
    
    
    4.6
    
    
    
    
    
    
    
    (42.5
    )Deferred tax provision
    
    
    
    
    
    
    6.6
    
    
    
    4.1
    
    
    
    0.3
    
    
    
    
    
    
    
    11.0Accretion of debt discount and
deferred issuance costs
    
    
    6.2
    
    
    
    5.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11.3Change in assets and liabilities
(net of effect of acquisitions):Increase in loans and other
receivables
    
    
    
    
    
    
    (15.1
    )
    
    
    (3.0
    )
    
    
    (58.3
    )
    
    
    
    
    
    
    (76.4
    )Increase in prepaid expenses and
other
    
    
    
    
    
    
    (2.8
    )
    
    
    (1.6
    )
    
    
    (0.9
    )
    
    
    
    
    
    
    (5.3
    )Increase (decrease) in accounts
payable,accrued expenses and other
liabilities
    
    
    1.7
    
    
    
    (7.9
    )
    
    
    (3.5
    )
    
    
    (26.3
    )
    
    
    
    
    
    
    (36.0
    )Net cash provided by (used in) operating
activities
    
    
    2.1
    
    
    
    16.6
    
    
    
    13.2
    
    
    
    (25.1
    )
    
    
    
    
    
    
    6.8Cash flows from investing activities:Acquisitions, net of cash acquired
    
    
    
    
    
    
    (19.3
    )
    
    
    1.6
    
    
    
    (56.4
    )
    
    
    
    
    
    
    (74.1
    )Additions to property and equipment
    
    
    
    
    
    
    (5.5
    )
    
    
    (4.8
    )
    
    
    (19.2
    )
    
    
    
    
    
    
    (29.5
    )Net (increase) decrease in due from
affiliates
    
    
    (7.2
    )
    
    
    (135.7
    )
    
    
    3.2
    
    
    
    139.7
    
    
    
    
    
    
    
    Net cash (used in) provided by investing
activities
    
    
    (7.2
    )
    
    
    (160.5
    )
    
    
    
    
    
    
    64.1
    
    
    
    
    
    
    
    (103.6
    )Cash flows from financing activities:Proceeds from the exercise of stock options
    
    
    0.3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.3Net increase in revolving credit facilities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    154.2
    
    
    
    
    
    
    
    154.2Payment of debt issuance and other costs
    
    
    (0.3
    )
    
    
    (2.2
    )
    
    
    
    
    
    
    (1.8
    )
    
    
    
    
    
    
    (4.3
    )Net cash provided by (used in) financing
activities
    
    
    
    
    
    
    (2.2
    )
    
    
    
    
    
    
    152.4
    
    
    
    
    
    
    
    150.2Effect of exchange rate changes on cash and
cash equivalents
    
    
    
    
    
    
    15.5
    
    
    
    
    
    
    
    1.1
    
    
    
    
    
    
    
    16.6Net (decrease) increase in cash and cash
equivalents
    
    
    (5.1
    )
    
    
    (130.6
    )
    
    
    13.2
    
    
    
    192.5
    
    
    
    
    
    
    
    70.0Cash and cash equivalents balance-beginning
of period
    
    
    5.4
    
    
    
    218.6
    
    
    
    18.3
    
    
    
    49.0
    
    
    
    
    
    
    
    291.3Cash and cash equivalents balance-end of
period
    
    $
    0.3
    
    
    $
    88.0
    
    
    $
    31.5
    
    
    $
    241.5
    
    
    $
    
    
    
    $
    361.3
 43




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
NOTES TO INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 13. Pending Acquisitions
  14. Subsequent Events
   44




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 This Quarterly Report on Form 10-Q and the documents incorporated herein contain
forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Those statements are
therefore entitled to the protection of the safe harbor provisions of these laws. These
forward-looking statements, which are usually accompanied by words such as may, might, will,
should, could, intends, estimates, predicts, potential, continue, believes,
anticipates, plans, expects and similar expressions, involve risks and uncertainties, and
relate to, without limitation, statements about our market opportunities, anticipated improvements
in operations, our plans, earnings, cash flow and expense estimates, strategies and prospects, both
business and financial. There are important factors that could cause our actual results, level of
activity, performance or achievements to differ materially from those expressed or forecasted in,
or implied by, such forward-looking statements, particularly those factors discussed in Item 1A -
Risk Factors in our Annual Report on Form 10-K for our fiscal year ended June 30, 2010 and in Part
II, Item 1A of this Quarterly Report on Form 10-Q.
 Although we believe that the expectations reflected in these forward-looking statements
are based upon reasonable assumptions, no assurance can be given that such expectations will be
attained or that any deviations will not be material. In light of these risks, uncertainties and
assumptions, the forward-looking events and circumstances discussed in this Quarterly Report on
Form 10-Q may not occur and our actual results could differ materially and adversely from those
anticipated or implied in the forward-looking statements. These forward-looking statements speak
only as of the date on which they are made, and, except as otherwise required by law, we disclaim
any obligation or undertaking to disseminate any update or revision to any forward-looking
statement contained herein to reflect any change in our expectations with regard thereto or any
change in events, conditions or circumstances on which any such statement is based. If we do update
or modify one or more forward-looking statements, you should not conclude that we will make
additional updates or modifications with respect thereto or with respect to other forward-looking
statements, except as required by law.
 Unless the context otherwise requires, as used in this Quarterly Report on Form 10-Q, (i)
the terms fiscal year and fiscal refer to the twelve-month period ended on June 30 of the
specified year, (ii) references to $, dollars, United States dollars or U.S. dollars refer
to the lawful currency of the United States of America, (iii) references to CAD refer to the
lawful currency of Canada, (iv) references to GBP refer to the British Pound Sterling, the lawful
currency of the United Kingdom of Great Britain and Northern Ireland, (v) references to SEK refer
to the Swedish Krona, the lawful currency of Sweden and (vi) references to EUR refer to the Euro,
the lawful currency of the European Union .
 Executive Summary
 Overview
  ® ® ® ® ® ® ® ® ®
  45




---



##### Table of Contents



Recent Events
     46




---



##### Table of Contents



Discussion of Critical Accounting Policies
   47




---



##### Table of Contents



Results of Operations
  Three Months Ended March 31,
    
    
    Nine Months Ended March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011(Dollars in thousands, except per share amounts)Total revenues:Consumer lending
    
    $
    78,062
    
    
    
    47.8
    %
    
    $
    100,712
    
    
    
    50.9
    %
    
    $
    238,250
    
    
    
    50.7
    %
    
    $
    292,009
    
    
    
    52.7
    %Check cashing
    
    
    37,236
    
    
    
    22.8
    %
    
    
    36,626
    
    
    
    18.5
    %
    
    
    113,575
    
    
    
    24.2
    %
    
    
    108,669
    
    
    
    19.6
    %Money transfer fees
    
    
    6,609
    
    
    
    4.0
    %
    
    
    7,340
    
    
    
    3.7
    %
    
    
    20,523
    
    
    
    4.4
    %
    
    
    22,476
    
    
    
    4.1
    %Pawn service fees and sales
    
    
    4,814
    
    
    
    2.9
    %
    
    
    16,589
    
    
    
    8.4
    %
    
    
    13,302
    
    
    
    2.8
    %
    
    
    30,103
    
    
    
    5.4
    %Gold sales
    
    
    13,040
    
    
    
    8.0
    %
    
    
    12,318
    
    
    
    6.2
    %
    
    
    32,052
    
    
    
    6.8
    %
    
    
    34,696
    
    
    
    6.3
    %Other
    
    
    23,587
    
    
    
    14.5
    %
    
    
    24,235
    
    
    
    12.3
    %
    
    
    51,843
    
    
    
    11.1
    %
    
    
    66,568
    
    
    
    11.9
    %Total consolidated revenues
    
    
    163,348
    
    
    
    100.0
    %
    
    
    197,820
    
    
    
    100.0
    %
    
    
    469,545
    
    
    
    100.0
    %
    
    
    554,521
    
    
    
    100.0
    %Operating expenses:Salaries and benefits
    
    
    39,882
    
    
    
    24.4
    %
    
    
    46,201
    
    
    
    23.4
    %
    
    
    114,341
    
    
    
    24.4
    %
    
    
    129,688
    
    
    
    23.4
    %Provision for loan losses
    
    
    10,220
    
    
    
    6.3
    %
    
    
    18,428
    
    
    
    9.3
    %
    
    
    34,578
    
    
    
    7.4
    %
    
    
    48,865
    
    
    
    8.8
    %Occupancy
    
    
    10,974
    
    
    
    6.7
    %
    
    
    13,256
    
    
    
    6.7
    %
    
    
    32,659
    
    
    
    7.0
    %
    
    
    36,867
    
    
    
    6.6
    %Cost of goods sold
    
    
    9,285
    
    
    
    5.7
    %
    
    
    7,546
    
    
    
    3.8
    %
    
    
    22,694
    
    
    
    4.8
    %
    
    
    22,422
    
    
    
    4.0
    %Depreciation
    
    
    3,424
    
    
    
    2.1
    %
    
    
    4,247
    
    
    
    2.1
    %
    
    
    10,869
    
    
    
    2.3
    %
    
    
    11,774
    
    
    
    2.1
    %Other
    
    
    25,603
    
    
    
    15.6
    %
    
    
    30,994
    
    
    
    15.7
    %
    
    
    73,938
    
    
    
    15.7
    %
    
    
    89,500
    
    
    
    16.3
    %Total operating expenses
    
    
    99,388
    
    
    
    60.8
    %
    
    
    120,672
    
    
    
    61.0
    %
    
    
    289,079
    
    
    
    61.6
    %
    
    
    339,116
    
    
    
    61.2
    %Operating margin
    
    
    63,960
    
    
    
    39.2
    %
    
    
    77,148
    
    
    
    39.0
    %
    
    
    180,466
    
    
    
    38.4
    %
    
    
    215,405
    
    
    
    38.8
    %Corporate expenses
    
    
    22,068
    
    
    
    13.5
    %
    
    
    25,223
    
    
    
    12.8
    %
    
    
    65,368
    
    
    
    13.9
    %
    
    
    74,587
    
    
    
    13.5
    %Other depreciation and amortization
    
    
    2,490
    
    
    
    1.5
    %
    
    
    3,058
    
    
    
    1.5
    %
    
    
    4,652
    
    
    
    1.0
    %
    
    
    8,572
    
    
    
    1.5
    %Interest expense, net
    
    
    21,946
    
    
    
    13.4
    %
    
    
    22,987
    
    
    
    11.6
    %
    
    
    46,412
    
    
    
    9.9
    %
    
    
    66,490
    
    
    
    12.0
    %Loss on extinguishment of debt
    
    
    718
    
    
    
    0.4
    %
    
    
    
    
    
    
    
    %
    
    
    9,531
    
    
    
    2.0
    %
    
    
    
    
    
    
    
    %Unrealized foreign exchange gain
    
    
    (15,681
    )
    
    
    (9.6)
    %
    
    
    (10,043
    )
    
    
    (5.1)
    %
    
    
    (11,769
    )
    
    
    (2.5)
    %
    
    
    (42,452
    )
    
    
    (7.7)
    %Loss on derivatives not designated as hedges
    
    
    18,634
    
    
    
    11.4
    %
    
    
    9,591
    
    
    
    4.8
    %
    
    
    21,909
    
    
    
    4.7
    %
    
    
    34,211
    
    
    
    6.2
    %Provision for (proceeds from)
litigation settlements
    
    
    26,627
    
    
    
    16.3
    %
    
    
    135
    
    
    
    0.1
    %
    
    
    27,894
    
    
    
    5.9
    %
    
    
    (3,797
    )
    
    
    (0.7)
    %Loss on store closings
    
    
    1,507
    
    
    
    0.9
    %
    
    
    131
    
    
    
    0.1
    %
    
    
    3,157
    
    
    
    0.7
    %
    
    
    598
    
    
    
    0.1
    %Other expense, net
    
    
    261
    
    
    
    0.3
    %
    
    
    747
    
    
    
    0.5
    %
    
    
    1,685
    
    
    
    0.3
    %
    
    
    3,428
    
    
    
    0.6
    %(Loss) income before income taxes
    
    
    (14,610
    )
    
    
    (8.9)
    %
    
    
    25,319
    
    
    
    12.8
    %
    
    
    11,627
    
    
    
    2.5
    %
    
    
    73,768
    
    
    
    13.3
    %Income tax (benefit) provision
    
    
    (2,332
    )
    
    
    (1.4)
    %
    
    
    9,731
    
    
    
    5.0
    %
    
    
    11,538
    
    
    
    2.5
    %
    
    
    26,320
    
    
    
    4.7
    %Net (loss) income
    
    
    (12,278
    )
    
    
    (7.5)
    %
    
    
    15,588
    
    
    
    7.8
    %
    
    
    89
    
    
    
    
    %
    
    
    47,448
    
    
    
    8.6
    %Less: Net loss attributable to
non-controlling interests
    
    
    (37
    )
    
    
    
    %
    
    
    (123
    )
    
    
    (0.1)
    %
    
    
    (73
    )
    
    
    
    %
    
    
    (523
    )
    
    
    (0.1)
    %Net (loss) income attributable to Dollar
Financial Corp.
    
    $
    (12,241
    )
    
    
    (7.5)
    %
    
    $
    15,711
    
    
    
    7.9
    %
    
    $
    162
    
    
    
    
    %
    
    $
    47,971
    
    
    
    8.7
    %Net (loss) income per share attributable to
Dollar Financial Corp.:Basic
    
    $
    (0.34
    )
    
    
    
    
    
    $
    0.43
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    1.31Diluted
    
    $
    (0.34
    )
    
    
    
    
    
    $
    0.41
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    1.26
 Constant Currency Analysis
  48




---



##### Table of Contents



Three Months Ended March 31, 2011 compared to Three Months Ended March 31, 2010
 Revenues
      Operating Expenses
  49




---



##### Table of Contents



Corporate Expenses
  Other Depreciation and Amortization
  Interest Expense
   Unrealized Foreign Exchange Gain/Loss
  50




---



##### Table of Contents



Loss on derivatives not designated as hedges
  (Proceeds from) Provision for Litigation Settlements
  Loss on Store Closings
  Other (Income) Expense
   Income Tax Provision
   51




---



##### Table of Contents



Nine months Ended March 31, 2011 compared to Nine months Ended March 31, 2010
 Revenues
     52




---



##### Table of Contents



Operating Expenses
    Corporate Expenses
  Other Depreciation and Amortization
  Interest Expense
   53




---



##### Table of Contents



Unrealized Foreign Exchange Gain/Loss
  Loss on derivatives not designated as hedges
  (Proceeds from) Provision for Litigation Settlements
  Loss on Store Closings
   Other (Income) Expense
   Income Tax Provision
  54




---



##### Table of Contents



Deferred
    
    
    Valuation
    
    
    Net DeferredTax Asset
    
    
    Allowance
    
    
    Tax AssetBalance at June 30, 2010
    
    $
    122.8
    
    
    $
    85.0
    
    
    $
    37.8US increase/(decrease)
    
    
    0.8
    
    
    
    2.9
    
    
    
    (2.1
    )Foreign increase/(decrease)
    
    
    (5.9
    )
    
    
    0.2
    
    
    
    (6.1
    )Balance at March 31, 2011
    
    $
    117.7
    
    
    $
    88.1
    
    
    $
    29.6
  55




---



##### Table of Contents



Review of Reportable Segments
  Three Months Ended
    
    
    
    
    
    Nine Months EndedMarch 31,
    
    
    % Inc/Dec -
    
    
    March 31,
    
    
    % Inc/Dec -Margin
    
    
    
    
    
    
    
    
    
    
    Margin2010
    
    
    2011
    
    
    Change
    
    
    2010
    
    
    2011
    
    
    Change(Dollars in thousands)United States Retail revenues:Consumer lending
    
    $
    15,047
    
    
    $
    14,649
    
    
    
    -2.6
    %
    
    $
    51,084
    
    
    $
    47,014
    
    
    
    -8.0
    %Check cashing
    
    
    14,055
    
    
    
    12,855
    
    
    
    -8.5
    %
    
    
    36,094
    
    
    
    32,086
    
    
    
    -11.1
    %Money transfer fees
    
    
    1,176
    
    
    
    1,102
    
    
    
    -6.3
    %
    
    
    3,671
    
    
    
    3,358
    
    
    
    -8.5
    %Gold sales
    
    
    131
    
    
    
    641
    
    
    
    389.3
    %
    
    
    272
    
    
    
    1,657
    
    
    
    509.2
    %Other
    
    
    2,740
    
    
    
    3,170
    
    
    
    15.7
    %
    
    
    7,849
    
    
    
    9,113
    
    
    
    16.1
    %Total United States Retail revenues
    
    $
    33,149
    
    
    $
    32,417
    
    
    
    -2.2
    %
    
    $
    98,970
    
    
    $
    93,228
    
    
    
    -5.8
    %Operating margin
    
    
    28.0
    %
    
    
    31.5
    %
    
    3.5 pts.
    
    
    21.5
    %
    
    
    26.9
    %
    
    5.4 pts.Total DFS revenues (included in
other revenue)
    
    $
    6,893
    
    
    $
    5,355
    
    
    
    -22.3
    %
    
    $
    7,514
    
    
    $
    17,360
    
    
    
    131.0
    %Operating margin
    
    
    64.6
    %
    
    
    49.4
    %
    
    (15.2 pts.)
    
    
    64.4
    %
    
    
    55.5
    %
    
    (8.9 pts.)Canada revenues:Consumer lending
    
    $
    36,313
    
    
    $
    41,826
    
    
    
    15.2
    %
    
    $
    109,655
    
    
    $
    126,288
    
    
    
    15.2
    %Check cashing
    
    
    15,867
    
    
    
    17,114
    
    
    
    7.9
    %
    
    
    51,355
    
    
    
    53,944
    
    
    
    5.0
    %Money transfer fees
    
    
    3,897
    
    
    
    4,386
    
    
    
    12.5
    %
    
    
    12,164
    
    
    
    13,636
    
    
    
    12.1
    %Pawn service fees and sales
    
    
    
    
    
    
    9
    
    
    
    100.0
    %
    
    
    
    
    
    
    18
    
    
    
    100.0
    %Gold sales
    
    
    4,977
    
    
    
    3,553
    
    
    
    -28.6
    %
    
    
    7,584
    
    
    
    11,254
    
    
    
    48.4
    %Other
    
    
    9,966
    
    
    
    10,986
    
    
    
    10.2
    %
    
    
    23,571
    
    
    
    24,435
    
    
    
    3.7
    %Total Canada revenues
    
    $
    71,020
    
    
    $
    77,874
    
    
    
    9.7
    %
    
    $
    204,329
    
    
    $
    229,575
    
    
    
    12.4
    %Operating margin
    
    
    46.7
    %
    
    
    46.4
    %
    
    (0.3 pts.)
    
    
    48.5
    %
    
    
    48.4
    %
    
    (0.1 pts.)Europe revenues:Consumer lending
    
    $
    26,702
    
    
    $
    44,237
    
    
    
    65.7
    %
    
    $
    77,511
    
    
    $
    118,707
    
    
    
    53.1
    %Check cashing
    
    
    7,314
    
    
    
    6,657
    
    
    
    -9.0
    %
    
    
    26,126
    
    
    
    22,639
    
    
    
    -13.3
    %Money transfer fees
    
    
    1,536
    
    
    
    1,852
    
    
    
    20.6
    %
    
    
    4,688
    
    
    
    5,482
    
    
    
    16.9
    %Pawn service fees and sales
    
    
    4,814
    
    
    
    16,580
    
    
    
    244.4
    %
    
    
    13,302
    
    
    
    30,085
    
    
    
    126.2
    %Gold sales
    
    
    7,932
    
    
    
    8,124
    
    
    
    2.4
    %
    
    
    24,196
    
    
    
    21,785
    
    
    
    -10.0
    %Other
    
    
    3,992
    
    
    
    4,724
    
    
    
    18.3
    %
    
    
    12,406
    
    
    
    15,639
    
    
    
    26.1
    %Total Europe revenues
    
    $
    52,290
    
    
    $
    82,174
    
    
    
    57.2
    %
    
    $
    158,229
    
    
    $
    214,337
    
    
    
    35.5
    %Operating margin
    
    
    33.5
    %
    
    
    34.2
    %
    
    0.7 pts.
    
    
    35.6
    %
    
    
    32.5
    %
    
    (3.1 pts.)Other revenues:Total Other revenues (included in
other revenue)
    
    
    (4
    )
    
    
    
    
    
    
    -100.0
    %
    
    
    503
    
    
    
    21
    
    
    
    -95.8
    %Total Other revenues
    
    $
    (4
    )
    
    $
    
    
    
    
    -100.0
    %
    
    $
    503
    
    
    $
    21
    
    
    
    -95.8
    %Operating margin
    
    
    n/m
    
    
    
    n/m
    
    
    
    n/m
    
    
    
    -244.4
    %
    
    
    -654.7
    %
    
    (410.3 pts.)Total revenue
    
    $
    163,348
    
    
    $
    197,820
    
    
    
    21.1
    %
    
    $
    469,545
    
    
    $
    554,521
    
    
    
    18.1
    %Operating margin
    
    $
    63,960
    
    
    $
    77,148
    
    
    
    20.6
    %
    
    $
    180,466
    
    
    $
    215,405
    
    
    
    19.4
    %Operating margin %
    
    
    39.2
    %
    
    
    39.0
    %
    
    (0.2 pts.)
    
    
    38.4
    %
    
    
    38.8
    %
    
    0.4 pts.
  Three Months Ended March 31,
    
    
    Nine Months Ended March 31,Revenue
    
    
    Pre-Tax Income
    
    
    Revenue
    
    
    Pre-Tax Income2010
    
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010
    
    
    2011
    
    
    2010
    
    
    2011United States Retail
    
    
    20.3
    %
    
    
    16.4
    %
    
    
    48.2
    %
    
    
    37.0
    %
    
    
    21.1
    %
    
    
    16.8
    %
    
    
    35.2
    %
    
    
    35.8
    %DFS
    
    
    4.2
    %
    
    
    2.7
    %
    
    
    20.5
    %
    
    
    5.0
    %
    
    
    1.6
    %
    
    
    3.1
    %
    
    
    6.7
    %
    
    
    8.5
    %Canada
    
    
    43.5
    %
    
    
    39.4
    %
    
    
    38.1
    %(1)
    
    
    46.3
    %(4)
    
    
    43.5
    %
    
    
    41.4
    %
    
    
    69.4
    %(7)
    
    
    48.3
    %(10)Europe
    
    
    32.0
    %
    
    
    41.5
    %
    
    
    74.3
    %(2)
    
    
    43.1
    %(5)
    
    
    33.7
    %
    
    
    38.7
    %
    
    
    57.2
    %(8)
    
    
    56.1
    %(11)Other
    
    
    
    
    
    
    
    
    
    
    -81.1
    %(3)
    
    
    -31.4
    %(6)
    
    
    0.1
    %
    
    
    
    
    
    
    -68.5
    %(9)
    
    
    -48.7
    %(12)100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
 56




---



##### Table of Contents



(1)
    
    Excludes $16.0 million of unrealized foreign exchange gains, $18.6 million of losses on
derivatives not designated as hedges and $22.4 million of provisions for litigation
settlements.(2)
    
    Excludes $0.2 million of unrealized foreign exchange losses.(3)
    
    Excludes $0.1 million of unrealized foreign exchange losses and $4.2 million of
provisions for litigation settlements.(4)
    
    Excludes $12.9 million of unrealized foreign exchange gains, and $9.6 million of losses
on derivatives not designated as hedges.(5)
    
    Excludes $2.2 million of unrealized foreign exchange losses.(6)
    
    Excludes $0.7 million of unrealized foreign exchange losses and $0.1 million of
provisions for litigation settlements.(7)
    
    Excludes $20.0 million of unrealized foreign exchange gains and $21.9 million of losses
on derivatives not designated as hedges and $22.4 million of provisions for litigation
settlements.(8)
    
    Excludes $8.1 million of unrealized foreign exchange losses.(9)
    
    Excludes $0.1 million of unrealized foreign exchange losses and $5.5 million of
provisions for litigation settlements.(10)
    
    Excludes $47.1 million of unrealized foreign exchange gains, $4.0 million of proceeds
from litigation settlements and $34.2 million of losses on derivatives not designated as
hedges.(11)
    
    Excludes $2.1 million of unrealized foreign exchange losses.(12)
    
    Excludes $2.5 million of unrealized foreign exchange losses and $0.2 million of
provisions for litigation settlements. Three Months Ended March 31, 2011 compared to Three Months Ended March 31, 2010
 United States Retail
     Dealers Financial Services
  57




---



##### Table of Contents



Canada
    Europe
    58




---



##### Table of Contents



Nine months Ended March 31, 2011 compared to Nine months Ended March 31, 2010
 United States Retail
     Dealers Financial Services
  Canada
   59




---



##### Table of Contents



Europe
    Changes in Financial Condition
   
    
    Continued improvements in United States Retail collections and our actions, taken in an
effort to decrease our risk exposure by reducing the amount that we are willing to loan to
certain customer segments. The historical loss rates (expressed as a percentage
of loan amounts originated for the last twelve months applied against the principal balance of
outstanding loans) have continued
 60




---



##### Table of Contents



to decline. The ratio of the allowance for loan losses related to United States Retail
short-term consumer loans decreased from 4.1% at June 30, 2010 to 2.2% at March 31, 2011.
    
    In constant currency, the ratio of allowance for loan losses in Canada as a percentage of
loans outstanding has decreased from 2.7% at June 30, 2010 to 2.0% at March 31, 2011.
    
    In constant currency, Europes ratio of allowance for loan losses as a percentage of loans
outstanding has increased from 14.8% at June 30, 2010 to 15.2% at March 31, 2011, primarily
as a result of higher loss reserves applied to our legacy loan business. The impact of a
larger loan portfolio in Poland, which carries a higher loan loss reserve percentage than our
legacy single payment portfolio, continues to increase the overall loan loss reserve as a
percentage of gross loans receivable.
 Liquidity and Capital Resources
     Senior Secured Credit Facility
   61




---



##### Table of Contents



Prior Credit Facility
      62




---



##### Table of Contents



Scandinavian Credit Facilities
  Other Debt
  Long-Term Debt
     Future Obligations
   63




---



##### Table of Contents



Less than
    
    
    1-3
    
    
    4-5
    
    
    After 5Total
    
    
    1 Year
    
    
    Years
    
    
    Years
    
    
    YearsRevolving credit facilities
    
    $
    152.5
    
    
    $
    152.5
    
    
    $
    
    
    
    $
    
    
    
    $
    Long-term debt:10.375% Senior Notes due 2016
    
    
    600.0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    600.02.875% Senior Convertible Notes due 2027
    
    
    44.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44.83.0% Senior Convertible Notes due 2028
    
    
    120.0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120.0Scandinavian credit facilities
    
    
    67.1
    
    
    
    5.7
    
    
    
    52.7
    
    
    
    8.7Other Notes Payable
    
    
    8.9
    
    
    
    0.4
    
    
    
    8.5
    
    
    
    
    
    
    
    Obligations under Canadian Class Action
Settlement Agreements Payable in Cash
    
    
    14.0
    
    
    
    14.0
    
    
    
    
    
    
    
    
    
    
    
    Sefina acquisition installment payments
    
    
    10.6
    
    
    
    10.6
    
    
    
    
    
    
    
    
    
    
    
    Operating lease obligations
    
    
    190.8
    
    
    
    37.4
    
    
    
    68.8
    
    
    
    41.7
    
    
    
    42.9Total contractual cash obligations
    
    $
    1,208.7
    
    
    $
    220.6
    
    
    $
    130.0
    
    
    $
    50.4
    
    
    $
    807.7
  Seasonality
  Impact of Inflation
  Impact of Recent Accounting Pronouncements
 Receivables  Disclosures about the Credit Quality of Financing Receivables and the Allowance for
Credit Losses
 Business Combinations (Topic 805) 
Disclosure of Supplementary Pro Forma Information for Business Combinations
 64




---



##### Table of Contents



DOLLAR FINANCIAL CORP.
SUPPLEMENTAL STATISTICAL DATA
  Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2011
    
    
    2010
    
    
    2011U.S. consumer loan originations
    
    $
    111.8
    
    
    $
    110.4
    
    
    $
    387.0
    
    
    $
    366.1Canadian consumer loan originations
    
    
    184.2
    
    
    
    211.3
    (1)
    
    
    592.5
    
    
    
    648.2
    (1)U.K. consumer loan originations
    
    
    123.2
    
    
    
    187.3
    (2)
    
    
    368.4
    
    
    
    512.4
    (2)Poland consumer loan originations.
    
    
    3.6
    
    
    
    2.9
    (3)
    
    
    7.7
    
    
    
    11.2
    (3)Total consumer loan originations
    
    $
    422.8
    
    
    $
    511.9
    
    
    $
    1,355.6
    
    
    $
    1,537.9U.S. consumer loan revenues
    
    $
    15.0
    
    
    $
    14.7
    
    
    
    51.0
    
    
    
    47.0Canadian consumer loan revenues
    
    
    36.4
    
    
    
    41.8
    
    
    
    109.7
    
    
    
    126.3U.K. consumer loan revenues
    
    
    24.7
    
    
    
    41.7
    
    
    
    72.4
    
    
    
    111.8Poland consumer loan revenues
    
    
    2.0
    
    
    
    2.5
    
    
    
    5.2
    
    
    
    6.9Total consumer lending revenues, net
    
    $
    78.1
    
    
    $
    100.7
    
    
    $
    238.3
    
    
    $
    292.0Gross charge-offs of consumer loans
    
    $
    38.1
    
    
    $
    53.5
    
    
    $
    123.5
    
    
    $
    152.5Recoveries of consumer loans
    
    
    (28.1
    )
    
    
    (34.7
    )
    
    
    (91.8
    )
    
    
    (108.5
    )Net charge-offs on consumer loans
    
    $
    10.0
    
    
    $
    18.8
    
    
    $
    31.7
    
    
    $
    44.0Gross charge-offs of consumer loans as a
percentage of total consumer loan
originations
    
    
    9.0
    %
    
    
    10.5
    %
    
    
    9.1
    %
    
    
    9.9
    %Recoveries of consumer loans as a
percentage of total consumer loan
originations
    
    
    6.6
    %
    
    
    6.8
    %
    
    
    6.8
    %
    
    
    7.0
    %Net charge-offs on consumer loans as a
percentage of total consumer loan
originations
    
    
    2.4
    %
    
    
    3.7
    %
    
    
    2.3
    %
    
    
    2.9
    %
 
 (1)
    
    Net of a $11.1 million and $31.5 million increase as a result of the impact of exchange rates for the three and nine months ended March 31, 2011.(2)
    
    Net of a $5.1 million increase and $9.4 million decrease as a result of the impact of exchange rates for the three and nine months March 31, 2011.(3)
    
    Net of a $0.2 million decrease as a result of the impact of exchange rates for the nine months March 31, 2011. 65




---



##### Table of Contents



Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Generally
  
    
    interest rates on revolving credit facilities; and
    
    foreign exchange rates generating translation gains and losses.
  Interest Rate Risk
  Foreign Currency Exchange Rate Risk
 Put Options
   66




---



##### Table of Contents



Cross-Currency Interest Rate Swaps
       67




---



##### Table of Contents



Item 4. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  Risk and uncertainties related to political and economic conditions in foreign countries in which
we operate could negatively impact our operations.
  68




---



##### Table of Contents



United States defense budget cuts that reduce enlistments or the number of active duty military
personnel, or high levels of overseas troop deployments, could harm our MILES program business.
  
 Item 5. Other Information.
  69




---



##### Table of Contents



Item 6. Exhibits
 Exhibit No.
    
    Description of Document1.1
    
    
    Underwriting Agreement, dated April 7, 2011, by and among Dollar Financial Corp, Credit Suisse
Securities (USA) LLC, Nomura Securities International, Inc. and each of the other Underwriters
named on Schedule A thereto (1)2.1+
    
    
    Share Purchase Agreement dated December 31, 2010 among Dollar Financial U.K. Limited, Dollar
Financial Corp., CCRT International Holdings B.V. and CompuCredit Holdings Corporation (2)4.1
    
    
    Supplemental Indenture dated December 2, 2010 between Dollar Financial U.S., Inc. and U.S.
Bank National Association, as trustee4.2
    
    
    Guarantee dated December 2, 2010 executed by Dollar Financial U.S., Inc.10.1
    
    
    Second Amended and Restated Credit Agreement, dated as of March 3, 2011, among Dollar
Financial Corp., Dollar Financial Group, Inc., National Money Mart Company, Dollar Financial U.K.
Limited and Instant Cash Loans Limited, Wells Fargo, National Association, as Administrative Agent
and as Security Trustee, and a syndicate of lenders. (3)31.1
    
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2
    
    
    Rule 13a-14(a)/15d-14(a) Certification of Executive Vice President and Chief Financial Officer31.3
    
    

Rule 13a-14(a)/15d-14(a)
Certification of Senior Vice President of Finance, Corporate
Controller and Chief Accounting Officer32.1
    
    
    Section 1350 Certification of Chief Executive Officer32.2
    
    
    Section 1350 Certification of Executive Vice President and Chief Financial Officer32.3
    
    

Section 1350 Certification of Senior Vice President of Finance, Corporate Controller and Chief Accounting Officer
 
 +
    
    Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
The Company hereby undertakes to furnish supplementally copies of any of the omitted
schedules and exhibits upon request by the Securities and Exchange Commission.(1)
    
    Incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K filed by
Dollar Financial Corp. on April 13, 2011.(2)
    
    Incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K filed by
Dollar Financial Corp. on April 5, 2011.(3)
    
    Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed by
Dollar Financial Corp. on March 9, 2011. 70




---



##### Table of Contents



SIGNATURE
  DOLLAR FINANCIAL CORP.Date: May 10, 2011
    *By:
    /s/ Randy UnderwoodName:
    Randy UnderwoodTitle:
    Executive Vice President and 
Chief Financial Officer 
 *
    
    The signatory hereto is the principal financial
officer and has been duly authorized to sign on behalf of the registrant. 71