EZCORP, Inc. (NASDAQ:EZPW) Q4 2019 Earnings Conference Call - Preliminary Transcript
Dec 05, 2019 • 05:00 pm ET
Daniel M. Chism
few additional quarters to begin to realize the full benefits of our investments in technology, distribution and customer service. That said, we remain confident, our strategic initiatives will drive long-term growth of free cash flows and higher returns on earning assets over time. More specifically the flatter trajectory of PLO growth more recently, partially driven by recent system issues, combined with the social benefit programs in Mexico will likely continue to pressure PSC and related earnings in the near term.
Our ongoing focus on reducing aged inventory on our balance sheet likely remains a headwind for merchandise sales and margins in the coming quarters.
Turning to expenses, we believe the system issues are now behind us after mid-July, but we're still working and are making additional investments to ensure these do not occur. That said, as Stuart mentioned, we recently completed the rollout of our new point-of-sale system providing a solid foundation to improve lending decisions thereby driving higher yields, PSC and net revenues over time and enhancing our team members ability to provide excellent customer service. While it's still early in the stores that have had the system a bit longer we've already seen some improvement in yields versus stores, they got it later.
We remain focused on controlling expenses, enhancing productivity and optimizing leadership structures in the field, which we believe will drive higher margins and EBITDA growth longer term, but these will take a bit of time to work through the system. From a cash flow perspective receipts from the Alpha credit notes receivable will reduce substantially in fiscal 2020 from the $30 million to $34 million we've received annually over the last three years. The total remaining balance due was down to $8 million at the end of fiscal 2019.
With that, I'll turn the call back over to Stuart.
Stuart I. Grimshaw
Thanks Dan and we'll now open it up for questions.