Rent-A-Center, Inc. Reports Fourth Quarter and Year End 2005 Results; Reported Diluted Earnings per Share of $0.50, or $0.48 Excluding Non-recurring Items; Same Store Sales Improve; Cash Flow from Operations Exceeds $187 Million for the Year

Business Wire, Feb 6, 2006

Rent-A-Center, Inc., headquartered in Plano, Texas, currently operates 2,760 company-owned stores nationwide and in Canada and Puerto Rico. The stores generally offer high-quality, durable goods such as major consumer electronics, appliances, computers and furniture and accessories under flexible rental purchase agreements that generally allow the customer to obtain ownership of the merchandise at the conclusion of an agreed upon rental period. ColorTyme, Inc., a wholly owned subsidiary of the Company, is a national franchiser of 294 rent-to-own stores, 285 of which operate under the trade name of "ColorTyme," and the remaining nine of which operate under the "Rent-A-Center" name.

The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. These statements do not include the potential impact of any repurchases of common stock the Company may make, expenses to be incurred in connection with the store consolidation plan, or the potential impact of acquisitions that may be completed after February 6, 2006.

FIRST QUARTER 2006 GUIDANCE:

Revenues

--The Company expects total revenues to be in the range of $591 million to $599 million.

--Store rental and fee revenues are expected to be between $509 million and $515 million.

--Total store revenues are expected to be in the range of $579 million to $587 million.

--Same store sales are expected to be flat to slightly positive.

--The Company expects to open 5-15 new rent-to-own store locations.

--The Company expects to add financial services to 10-15 rent-to-own store locations.

Expenses

--The Company expects cost of rental and fees to be between 21.6% and 22.0% of store rental and fee revenue and cost of goods merchandise sales to be between 65% and 70% of store merchandise sales.

--Store salaries and other expenses are expected to be in the range of 57.3% to 58.8% of total store revenue.

--General and administrative expenses are expected to be between 3.5% and 3.7% of total revenue.

--Net interest expense is expected to be approximately $12.0 million, depreciation of property assets to be approximately $13.0 million and amortization of intangibles is expected to be approximately $1.0 million.

--The effective tax rate is expected to be approximately 37.0% of pre-tax income.

--Diluted earnings per share are estimated to be in the range of $0.48 to $0.52, including stock option expense.

--Diluted shares outstanding are estimated to be between 69.7 million and 70.7 million.

FISCAL 2006 GUIDANCE:

Revenues

--The Company expects total revenues to be in the range of $2.33 billion and $2.36 billion.

--Store rental and fee revenues are expected to be between $2.080 billion and $2.105 billion.

--Total store revenues are expected to be in the range of $2.294 billion and $2.324 billion.

--Same store sales are expected to be flat to slightly positive.

--The Company expects to open 60-80 new store locations.

--The Company expects to add financial services to 100-160 rent-to-own store locations.