Rent-A-Center, Inc. Reports March Key Operating Metrics

PLANO, Texas–(BUSINESS WIRE)–Rent-A-Center, Inc. (the “Company”) (NASDAQ/NGS:RCII) today announced
the following key operating metrics for its Core U.S. and Acceptance NOW
(“ANow”) businesses for March 2017:

Core U.S.

  • Same Store Sales: (9.6%)
  • Delinquencies: 6.1% and 140 basis points favorable versus prior month
  • Average Monthly Rate of New Agreements: 6.6% unfavorable versus prior
    year
  • Co-worker Turnover: 83.7% and 10.4 percentage points favorable versus
    prior year

Acceptance NOW

  • Same Store Sales: 12.4%
  • Delinquencies: 8.8% and 40 basis points favorable versus prior month

In the Core U.S. segment, March same store sales increased sequentially
due to higher merchandise sales revenue following the tax refund delay
and continued improvements of the quality of the rental portfolio, as
evidenced by reduced delinquencies. Rent-A-Center is executing a new
strategic plan designed to restore growth, improve profitability and
maximize value for all Rent-A-Center stockholders. As part of this plan,
the Company is focused on increasing the mix of aspirational products
and has started to shift replenishment towards higher-end products. This
will take several quarters to become a meaningful portion of the
inventory and portfolio mix and, until that time, the average monthly
rate and gross profit margin will remain under pressure. The Company has
also aggressively implemented several initiatives aimed at reducing the
amount of Acceptance NOW returned product in the Core stores. These
initiatives include reducing the remaining inventory value of Acceptance
NOW product when it is transferred to the Core, for internal purposes,
in order to increase sell through rates. In addition, Acceptance NOW is
also reducing returns through a targeted initiative to increase the
early payout discount. Rent-A-Center has developed a more frequent and
pointed approach to training and development that will enable consistent
execution and strengthen customer relationships. The trajectory of
turnover remains well ahead of last year.

In Acceptance NOW, March same store sales were also favorably impacted
by the delay in tax refunds as strong rental and fee revenue of 7.8
percent was coupled with double digit merchandise sales growth.
Delinquencies improved sequentially by 40 basis points mainly driven by
the high seasonality around tax season. Over the longer term, the
previously disclosed exit from Conn Appliances, Inc. (“Conn’s”) is
expected to improve delinquencies and losses as the ANow customer
accounts originating from Conn’s consistently underperformed compared to
the rest of the Company’s ANow portfolio in terms of delinquencies,
losses and product returns. In March, the first wave of HHGregg stores
closed and the nearby Acceptance NOW locations that received merged
accounts were removed from the same store sales calculation.

Metric Definitions

Core U.S.

  • Same Store Sales – year over year revenue performance on comparable
    stores
  • Delinquencies – percent of customer agreements greater than 7 days
    past due
  • Average Monthly Rate of New Agreements – average monthly rental rate
    for agreements originated in the period
  • Co-worker Turnover – annualized year to date store co-worker turnover

Acceptance NOW

  • Same Store Sales – year over year revenue performance on comparable
    stores
  • Delinquencies – percent of customer agreements, in staffed locations,
    greater than 32 days past due

About Rent-A-Center, Inc.

A rent-to-own industry leader, Plano, Texas-based, Rent-A-Center, Inc.,
is focused on improving the quality of life for its customers by
providing them the opportunity to obtain ownership of high-quality,
durable products such as consumer electronics, appliances, computers,
furniture and accessories, under flexible rental purchase agreements
with no long-term obligation. The Company owns and operates stores in
the United States, Mexico, Canada and Puerto Rico, and Acceptance NOW
kiosk locations in the United States and Puerto Rico. Rent-A-Center
Franchising International, Inc., a wholly owned subsidiary of the
Company, is a national franchiser of rent-to-own stores operating under
the trade names of “Rent-A-Center”, “ColorTyme”, and “RimTyme”. For
additional information about the Company, please visit our website at www.rentacenter.com.

Forward-Looking Statements

This press release and the guidance above contain forward-looking
statements that involve risks and uncertainties. Such forward-looking
statements generally can be identified by the use of forward-looking
terminology such as “may,” “will,” “expect,” “intend,” “could,”
“estimate,” “should,” “anticipate,” “believe,” or “confident,” or the
negative thereof or variations thereon or similar terminology. The
Company believes that the expectations reflected in such forward-looking
statements are accurate. However, there can be no assurance that such
expectations will occur. The Company’s actual future performance could
differ materially from such statements. Factors that could cause or
contribute to such differences include, but are not limited to: the
general strength of the economy and other economic conditions affecting
consumer preferences and spending; factors affecting the disposable
income available to the Company’s current and potential customers;
changes in the unemployment rate; difficulties encountered in improving
the financial and operational performance of the Company’s business
segments; our chief executive officer and chief financial officer
transitions, including our ability to effectively operate and execute
our strategies during the interim period and difficulties or delays in
identifying and attracting a permanent chief financial officer with the
required level of experience and expertise; failure to manage the
Company’s store labor and other store expenses; the Company’s ability to
develop and successfully execute strategic initiatives; disruptions,
including capacity-related outages, caused by the implementation and
operation of the Company’s new store information management system, and
its transition to more-readily scalable, “cloud-based” solutions; the
Company’s ability to successfully market smartphones and related
services to its customers; the Company’s ability to develop and
successfully implement virtual or E-commerce capabilities, including
mobile applications; disruptions in the Company’s supply chain;
limitations of, or disruptions in, the Company’s distribution network;
rapid inflation or deflation in the prices of the Company’s products;
the Company’s ability to execute and the effectiveness of a store
consolidation, including the Company’s ability to retain the revenue
from customer accounts merged into another store location as a result of
a store consolidation; the Company’s available cash flow; the Company’s
ability to identify and successfully market products and services that
appeal to its customer demographic; consumer preferences and perceptions
of the Company’s brand; uncertainties regarding the ability to open new
locations; the Company’s ability to acquire additional stores or
customer accounts on favorable terms; the Company’s ability to control
costs and increase profitability; the Company’s ability to retain the
revenue associated with acquired customer accounts and enhance the
performance of acquired stores; the Company’s ability to enter into new
and collect on its rental or lease purchase agreements; the passage of
legislation adversely affecting the Rent-to-Own industry; the Company’s
compliance with applicable statutes or regulations governing its
transactions; changes in interest rates; adverse changes in the economic
conditions of the industries, countries or markets that the Company
serves; information technology and data security costs; the impact of
any breaches in data security or other disturbances to the Company’s
information technology and other networks and the Company’s ability to
protect the integrity and security of individually identifiable data of
its customers and employees; changes in the Company’s stock price, the
number of shares of common stock that it may or may not repurchase, and
future dividends, if any; changes in estimates relating to
self-insurance liabilities and income tax and litigation reserves;
changes in the Company’s effective tax rate; fluctuations in foreign
currency exchange rates; the Company’s ability to maintain an effective
system of internal controls; the resolution of the Company’s litigation;
and the other risks detailed from time to time in the Company’s SEC
reports, including but not limited to, its Annual Report on Form 10-K
for the year ended December 31, 2016. You are cautioned not to place
undue reliance on these forward-looking statements, which speak only as
of the date of this press release. Except as required by law, the
Company is not obligated to publicly release any revisions to these
forward-looking statements to reflect the events or circumstances after
the date hereof or to reflect the occurrence of unanticipated events.

Additional Information and Where to Find It

The Company intends to file a proxy statement with the U.S. Securities
and Exchange Commission (the “SEC”) with respect to its 2017 Annual
Meeting. The Company stockholders are strongly encouraged to read any
such proxy statement, the accompanying white proxy card and other
documents filed with the SEC carefully in their entirety when they
become available because they will contain important information.
Stockholders
will be able to obtain any proxy statement, any amendments or
supplements to the proxy statement and other documents filed by the
Company with the SEC free of charge at the SEC’s website at www.sec.gov.
Copies also will be available free of charge at the Company’s website at www.rentacenter.com
or by contacting the Company’s Investor Relations at 972-801-1100. The
Company, its directors, executive officers and other employees may be
deemed to be participants in the solicitation of proxies from the
Company’s stockholders in connection with the matters to be considered
at Rent-A-Center’s 2017 Annual Meeting. Information about certain
current directors and executive officers of the Company is available in
the Company’s proxy statement, dated April 18, 2016, for its 2016 Annual
Meeting. To the extent holdings of the Company’s securities by such
directors or executive officers have changed since the amounts printed
in the 2016 proxy statements, such changes have been or will be
reflected on Statements of Change in Ownership on Form 4 filed with the
SEC. More detailed information regarding the identity of potential
participants, and their direct or indirect interests, by security
holdings or otherwise, will be set forth in the proxy statement and
other materials to be filed with the SEC in connection with
Rent-A-Center’s 2017 Annual Meeting.

Contacts

Rent-A-Center, Inc.
Daniel O’Rourke, 972-801-1104
VP –
Finance, Investor Relations and Treasury
InvestorRelations@rentacenter.com