Michael J. Knell — Furniture Today,
EDMONTON, Alberta — Rentcash intends to sell or spin off its Insta-rent division, which rents furniture,


appliances, electronics and computers with or without an option to purchase, primarily through kiosks in The Brick and United Furniture stores across Canada.

“We believe this will provide better clarity on both business models and have a positive long-term impact on shareholder value,” said Rentcash Chairman and CEO Gordon Reykdal.

Insta-rent’s 92 locations include freestanding stores, some of which are set to close. Reykdal said the rental division is exploring opening some standalone supercenters to help move excess inventory.

Rentcash is a provider of payday advance loans, with some 388 stores nationwide operating as The Cash Store and Insta-loan.

The Insta-rent division, under the leadership since April of President and Chief Operating Officer Bill Johnson, a rent-to-own industry veteran, has focused on improving the performance of existing stores, and on growing through its strategic arrangement with The Brick Group, one of Canada’s largest home goods retailer.

In the year ended June 30, Insta-rent was a drag on Rentcash’s profitability, although Insta-rent revenues nearly doubled to C$24.1 million from 2012’s C$12.9 million.

The net loss deepened to C$3 million from C$1.9 million, which Reykdal attributed to start-up costs for new stores opened in the year.

He said revenues at the 35 rental stores open for the entire fiscal year shot up 26%, although that figure eased in the fourth quarter as the company restricted new rentals and focused on improving the quality of its customers.

In the fourth quarter, Insta-rent’s revenues jumped 64% to C$6.2 million.

In total, Rentcash had revenues of C$154.2 million in its latest fiscal year, double the prior year’s C$76.8 million. Yearly net earnings showed similar improvement, coming in at C$14 million or 67 Canadian cents per share, versus C$6.8 million or 38 cents per share in the prior year.