Good morning, and thank you for holding. Welcome to Rent-A-Center's Fourth Quarter 2018 Earnings Conference Call. As a reminder, this conference is being recorded, Tuesday, February 26, 2019. Your speakers for today are Mr. Mitch Fadel, Chief Executive Officer of Rent-A-Center; Maureen Short, Chief Financial Officer; and Daniel O'Rourke, Vice President of Finance and Real Estate. I would now like to turn the conference over to Mr. O'Rourke. Please go ahead, sir. Daniel O’Rourke: Thank you, Jessa. Good morning, everyone, and thank you for joining us. Our earnings release was distributed after market close yesterday, which outlines our operational and financial results for the fourth quarter of 2018. All related materials, including a link to the live webcast, are available on our website at investor.rentacenter.com. As a reminder, some of the statements provided on this call are forward-looking statements, which are subject to many factors that could cause actual results to differ materially from our expectations. Rent-A-Center undertakes no obligation to publicly update or revise any forward-looking statements. These factors are described in our earnings release issued yesterday as well as in the company's SEC filings. I'd now like to turn the call over to Mitch.

Thank you, Daniel, and good morning, everyone. Thank you for joining us. While we will get to our financial and operational performance in a minute, I want to first address the status of the litigation following our termination of the merger agreement with affiliates of Vintage Capital. On February 11 and 12, the trial was held in the Delaware Court of Chancery in the lawsuit arising from Rent-A-Center's termination of the merger agreement. While it's difficult to predict the outcome of the litigation, the company believes, under the express and unambiguous language of the agreement, it had a clear right to terminate the merger agreement, and that is described in our counterclaim. The company is entitled to the $126.5 million reverse breakup fee due following the termination of that agreement. Oral argument on the parties' post-trial briefs is scheduled for Monday, March 11. And we do ask you to keep your questions focused on our financial and operational performance when we conclude our presentation. And speaking of our presentation, we'll be providing a voice over to the presentation shown on the webcast. If you're unable to view the webcast, the presentation can also be found on our Investor Relations website. When I returned to Rent-A-Center back in January of 2018, we built a plan focused on 3 key pillars, and we have made significant progress in each area. First, we needed to optimize or rightsize the company's cost structure. Second, there were additional enhancements to the value proposition needed to drive customer growth and improve our return on investment. And finally, the last pillar was to accelerate our refranchising efforts. I'll go into the key highlights shown on the screen in more detail in the coming pages, and I'll also give you some perspective on where we see the business…

Thanks, Mitch. Good morning, everyone. I'll cover some financial highlights for the fourth quarter and provide an overview of our balance sheet and cash flow. I will then close with our financial targets for 2019 before opening up the call for questions. During the fourth quarter of 2018, consolidated total revenues were $661.8 million, an increase of 3.6% versus the same period of last year. Same-store sales for the consolidated business were positive 9.1% and improved sequentially in each month within the quarter. Adjusted EBITDA was $49 million in the quarter, and EBITDA margin was 7.4%, up 870 basis points over the same period last year. Net diluted profit per share, excluding special items, was $0.35. The special item charges taken in the quarter were $18.7 million, primarily driven by cost savings initiative, Core U.S. store closures and legal and professional fees associated with merger-related activities. In our Core segment, total revenues in the fourth quarter increased 4.9% versus the same period last year, primarily due to a same-store sales increase of 8.8%, offset by the rationalization of the Core U.S. store base. This is the eighth consecutive quarter of sequential same-store sales improvement and a 12.4 percentage point improvement versus the fourth quarter of last year. Store labor and other store expenses were down over $20 million in the fourth quarter, primarily driven by approximately $13 million in cost savings initiative and a lower store count. Adjusted EBITDA in the Core segment was $52.4 million, and EBITDA margin was 11.2%, which was up 700 basis points versus last year. Now turning to the Acceptance Now business. Same-store sales increased by 9.6% in the fourth quarter, while total revenues decreased by 1.5%, primarily due to closures in 2017. Store labor and other store expenses were down $24 million versus the…

[Operator Instructions] Your first question comes from the line of Kyle Joseph from Jefferies.

I want to just start out -- your growth in both segments, Acceptance Now and the Core, has been very impressive. And I was just trying to wrap my arms around that, given what we've seen from some other brick-and-mortar retailers and the likes. How much of that is driven by your initiatives? Are you seeing any changes in the competitive environment? Can you give us a little more color there?

Sure, Kyle. We're not really seeing any changes in the competitive environment in the brick-and-mortar side. I would say, mostly it's due to the value proposition changes we've made, the changes we've made to the product inventory, more of a localized assortment. The web orders, as I mentioned, are up dramatically. We grew by 70% last quarter year-over-year. And the web orders were like 60% higher than the year before, but our agreements were up over 70% higher. So the execution is better on what we do with those orders. So I think it's a combination. I don't think it's very much to do with competition. It's more to do with us, the changes we've made to the value proposition, execution and web orders, product flow and the like. And we -- by making the changes to our value proposition, Kyle, we were able to not give away as much on the promotional side, so it helped -- it helps the revenue as well. So I think it's been mostly what we've done. I don't see much change in the competition out there on the brick-and-mortar side.

Got it. That's helpful. And then you talked about Acceptance Now and reinvesting in that business, particularly after litigation is resolved. Can you give us a sense -- I know you mentioned technology. Is that primarily from an underwriting perspective that you're investing in? Or -- your plans there? And then from a growth opportunity, I know you talked about your pipeline. Just the balance between manned and unmanned kiosks in that business?

Yes, the -- sure, Kyle. The technology I was talking about is mostly not so much the decision engine technology because we have that already, and we use it even in our manned locations. But in the -- the technology I'm referring to is we're restarting now, with the merger agreement being terminated, restarting the advancement in the technology to do more unmanned locations because we see the growth being a combination of manned and unmanned. And our unmanned platform is -- hasn't been good enough. But soon, it will be good enough to compete and grow dramatically in that business based on the technology enhancements that we're working on there now. So as far as what that would mean store count-wise, we know the white space opportunity in Acceptance Now is tremendous, especially when you have a combined offering of manned and unmanned like we'll have very shortly. And we haven't put any numbers to that yet. We will as we go over the next quarter or so. But right now, we don't have -- we really don't have any growth in our guidance, so we haven't talked about how much more we can do with that. It's going to help us grow. There is a dramatic opportunity to grow Acceptance Now, like I said. There's also an opportunity to take -- to be more efficient with our labor with better software, so I think you will hear more about that over the next couple of months on the combination of what our growth numbers, once those are further identified as well as the optimization of some of the cost structure with better software on the labor side.

Great. And one last one from me. Maureen, I heard the write-offs for Acceptance Now, and apologies if I missed that, but did you give those for the Core -- or the skip/stolen? Sorry.

Sure. The skip/stolens in the Core business were 3.7% of revenue, up a little bit versus last year. Part of that is driven by the higher-end product mix that's in our stores. Operationally, the charge-offs were a little bit higher. But for the year, our skip/stolens were 3.3% of revenue, well within our historical range.

Yes. And we also had the -- I'm sorry, Kyle. I was just going to add, we -- the Acceptance Now, Maureen mentioned, that was the best skip and stolen number in Acceptance Now since 2015. I think for the year, it's the best one in 4 years. And the Core was well within our range. And the -- we also had, in 2017, a loss reserve credit and the accrual because the credit had come down in 2017. When Mark came back for that year, he focused on collections, got it down pretty well in 2017 and got a credit the way the reserve accrual works. So year-over-year, we were slightly higher, mostly because of that credit in 2017, as Maureen said, slightly higher operationally in charge-offs but certainly not a material increase.

Your next question comes from the line of John Rowan from Janney.

So Mitch, you talked about strong Black Friday sales. And the reason why I ask this -- or I want to talk about what the early payout options were for those Black Friday sales? Was it 3 months, 4 months, 6 months? As we sit here today with the IRS data that we're looking at, there's a big delay in tax refunds, specifically for refunds with earned income tax credits and additional childcare -- child tax credits in them. And I believe that, that delay pushes a lot of those refunds outside of like a 90-day same-as-cash window. So I'm just trying to gauge how much of those Black Friday sales had a longer than 3 months early payout option and whether or not you're seeing any change in the throughput from Black Friday sales to early payout options in 1Q based on this kind of specific cohort of tax refunds, which are actually quite a bit delayed versus last year.

Sure, John. Yes, we did have the best Black Friday we had from a customer growth standpoint ever for the week of Black Friday in it. To answer your question specifically, I think we rented in that period of time was -- there is no one answer to that question. It's between depending on the state and depending on the product, it may be anywhere from 120 to 180 days, same-as-cash. So those have still room for that as far as even with the income tax refunds being slowed down. Whenever you think about the same-as-cash kind of offering, most people talk about it in terms of days, 90 days, 120, 180, what is it, what's better and all that kind of stuff. Keep in mind, the other really important thing there is what do you price into that? So if you go -- if you have 180 days, if that was the same price as the 90 days, that might not be the best offering. But we don't -- we move our prices around depending on product category and so forth. So it's not -- just because you go from 90 to 180, it doesn't mean margins go down because you will have more payouts as you increase those number of days, which is a discount for the customer. But how much of a discount? How do we price it? What's our multiple on the cash price? That's an important factor to figure in there. As far as the income tax refunds coming in slower, it's always -- it's a double-edged sword. And we'll see over the next couple of weeks. Most people think they'll catch up. And it's too early to tell where we're going to end up. They're certainly coming in slower, but 2 weeks from now, it might all be -- it might all just have washed out normally. But double-edged sword, there's a lot of revenue from early purchase options. On the other hand, the less early purchase options you get, the portfolio saves dollars. So either way, it's going to work for us.

But you're not doing the 90 days anymore, is that correct? Because I'm just trying to look through some old filings, I see 90 days and I also see the worry-free guarantee on your website showing 3 to 4 months. I just want to make sure I understand where your current promotion activity is for worry-free guarantee or same-as-cash, whatever you want to call it.

Almost all of it is going to be either 120 or 180.

Okay. And then just last question, you said that there was a refranchising in January. Can you just remind me of the time frame of when that happened? And if I'm not mistaken, there was an injunction from the judge or in the Vintage merger. And my question is specifically about that, that did that barred you from doing certain type of large corporate transactions until the lawsuit was settled.

Well, it was a restraining order until the lawsuit settled. But there is an -- there was an opportunity to get approval for that transaction. We got approval for the Baltimore transaction, closed it, I don't know, Maureen, in mid-January?

Right.

I guess, mid-January. That's why the revenue from the December guidance we've put out to the guidance Maureen just talked about this morning is lower. Mostly, it's a revenue issue. There was a little bit of EBITDA. Of course, we get royalties, so those kind of offset each other in the revenues where the big drop is in the guidance between December and January. So short answer though, John, is we had gotten approval to do that transaction.

Okay. And last question, I'm not a lawyer, so post-trial oral arguments, I just want to know, is that towards the end of the conclusion of this -- of the lawsuit? Just I don't know every step of the way to conclusion. I'm not asking you to comment on it. Just where we stand in relation to the life of the lawsuit.

Well, March 11 is the post-trial brief oral arguments. And we just have to see where it goes after March 11. We don't really know how long it's going to take the judge to rule after that.

But that would be the next step, it would be ruling after the oral arguments, correct?

As far as -- yes. I'm not an attorney either. But yes, I believe that's right.

Your next question comes from the line of Budd Bugatch with Raymond James.

I was -- I want to just go a little bit more to what John was talking about, the cadence of EPOs. Can you maybe, Mitch, describe what the cadence is this year versus last of EPO with 180-day same-as-cash offering?

Well, generally speaking, they're a little bit higher than when we had 90 days or 120 days, not -- really not significantly higher. They're a little bit higher. They have a dramatic increase in customer acceptance and so forth, so. But they're just -- they're a little bit higher. Of course, in February, so far, it's hard to say because the income tax refunds are coming in slower, and we won't know for the next couple of weeks what happens with the tax refunds. But then from a general answer, not talking about the refunds because we're right in the middle of refund season and we're not going to know how that ends up for a couple of weeks, but generally speaking, it's slightly higher, but I would say pretty immaterially higher.

And slightly, can you -- is there any clarification you can give to slightly?

Well, we've talked about 25% to 30% ownership from our customers in the past with our new value proposition, which isn't just under 180-day or 120-day, there's -- we've also made some changes to our overall pricing, our early purchase option beyond the same-as-cash time frame. And we're up, you'll see it in the K, we're up to -- close to 35% ownership. So from the high 20s to 35%, is the difference. That's not all because of same-as-cash, it's just the overall value proposition has driven it from the high 20s to 35%.

And the 180 days, is that a permanent offer now?

Well, again, we -- I mean, some of our products depending on the state are in the 120 also. I wouldn't -- permanent? Hard to say. As the consumer changes, as the consumers are looking for something different, we may change it. Again, it's not just about whether we are 180 or 120 or 90 or whatever, it's about what's the price for that product. And you can -- there is ways to make more money on 180-day than you are making on 90.

Excuse me, it's furniture where you might have a slightly higher margin? Is that what you're referring to? Is that the way that we should think about that?

Well, certainly, furniture is a higher margin. And on the margin side, when you're putting a multiple on the cash option, you don't have to use the same margin, the same multiple for every product category. Or you don't have to use the same margin in 180 that we were using at 90. So price has a lot to do with it. And our gross margin dollars are way, way up, and the percentage is down like 20 or 30 basis points. So it's really had a de minimis impact on margin percent and, obviously, a glorious impact on margin dollars.

Well, I mean, the inventory on rent comparisons are pretty impressive. The number of Core stores in the comp calculation, now you do have a comp calculation that has a removal for stores that are merged, what's the percentage of stores or comp stores -- the percentage of Core stores that are in the comp?

I think, Maureen, it's about 75% are in the comp, like 1,500 or so are in the comp.

Yes. I think that's about right. You will see the details of that broken out in the K. We plan to file the K this coming Friday.

Okay. All right. That's good to know. And then on the charges for the cost savings, tell me what's in the charges? How long do they persist? Are we seeing more? Do we see more going into 2019?

We do have continued costs associated, onetime costs associated with implementation of our cost savings initiatives. What we've included in our 2019 guidance is about $25 million associated with lease obligations, remaining lease obligations and severance costs associated with the closure of our product repair center, which closed towards the end of 2018. And the 125, the approximate 125 store closures were planned for 2019.

And when will that -- when do you think you'll see that $25 million reversal or $25 million charge?

A lot of it will be in the first quarter. With the new accounting, lease accounting guidance, there may be a shift in the way that the timing hits of those costs. There shouldn't be a change in the amount of costs, but we're evaluating what that looks like from an accounting standards implementation. Typically, we take those charges all upfront as we either exit a facility or close the stores, but the cadence of that may look a little different with the new accounting standard.

And speaking about the new accounting standard, what do think the impact on the balance sheet is? I know you must have a preliminary estimate. I know that, that can still change because you won't see that until the end of the first quarter. But what should we think is a reasonable estimate for the balance sheet impact of the present value of the right of use lease obligation?

We're in the process of implementing a new lease accounting tool to help us quantify that. We haven't included an estimate in the 10-K. But looking at the lease obligations in the 5-year table, the reasonable estimate will include our store leases, the fleet associated with our vehicles and there are a few embedded leases that we have. But you'll see more in the first quarter results as far as how it's outlined on our balance sheet.

And the number, what kind of -- what number is that 5-year obligations that's a PV number? What number is that now?

I don't have that in front of me, Budd. But when we talk later, I can provide those numbers.

Mitch, customers per store are rising. What was the max customers per store average? I mean, we see -- if we go back in history, what was that? Do you recall?

No. Because we look at customers and agreements. We're not up -- we're not to the mix yet, I know that. When we think about the agreements per store or the portfolio balance per store, we still got room to grow. And as I've said, Budd, we ended the year with a portfolio in those same-stores being around 3% higher than last year and continue to believe we can add on to that. The web traffic is, as I said, at an all-time high. We're executing better. The orders went up about 60%, as I mentioned, in 2018 -- in the fourth quarter, I should say. But our actual orders were up 71%. So the customer -- for all the people that say brick-and-mortar is dead and retail, of course, more come from the web than ever before, and we have to continue to execute on those and continue to build that portfolio. But the short answer to your question is there's still room to get back to our historical highs.

And what about revenues per customer or agreements per customer, how is that trending?

It's very consistent. That -- well, that almost doesn't move over the years. That's been very consistent.

Okay. And in the guidance, how many stores are in the Core at the end of the year? Where do you think closures would be? I know we've got 37 franchise stores coming out. How many do you think you will franchise during the year, ceteris paribus? And how many will you close or merge?

It's hard to predict on the franchise aside. We'll do deals that makes sense for us from a financial standpoint. If we think a franchisee can improve the performance of an area so that we -- certainly, we're going to do deals that make financial sense for us and for the potential or the prospective franchisee. Also we see franchising -- it's interesting you ask it that way, Budd, because I see franchising as a growth vehicle for us. When we sell markets like Baltimore, it comes with an obligation to open more stores. And as you know, we haven't been opening stores in our Core business, the company-owned stores. So as we sell -- the transactions we did last year, those 2 that I mentioned and the one we did already this year, all 3 of those have growth requirements in it by the franchisee. So refranchising some of these markets can be a growth vehicle for us. We're not -- we don't have a number that we've got in our guidance. We don't have anything in our guidance other than what we've already done in January. So it's hard to predict because we're going to do deals that makes sense. And we don't want to force ourselves to a number either. We want to make good financial deals, and so we're not going to forecast that predictive. On the closures, we believe it's in the 125 area this year as far as how many will close. And we'll have some growth with the franchises, not just selling some stories but, again, some opening stores. But we don't have that number identified today.

So if I'm doing the math right, we should have about 162 less stores at the end of 2019 than we have now, ceteris paribus. And that's kind of the way the guidance was framed?

In those Core business, yes.

100 -- yes, so 125 to 137. Okay. All right. My last question -- well, let me -- I'll let others do it.

Your next question comes from the line of Vincent Caintic from Stephens.

Most of my questions have been asked, so I just have a couple of quick ones. On the updated guidance, so understand that it was primarily because of the franchise sales. So you have about $30 million lower revenue guide. Your EBITDA and EPS guidance is unchanged, though. So is -- should I -- we take that to mean that the franchise has also had $30 million of expense? Or was there maybe $30 million of additional savings that you found somewhere else?

No. Those stores had $30 million of revenue and close to that from an expense standpoint. There's a little -- and then there is an EBITDA drop there because they were profitable stores, but now we get royalties from the franchisees as well. So the difference was pretty de minimis in what our EBITDA was versus what their royalties are going to be going forward. So it's really just the revenue drop.

Okay. Got it. That makes sense. When you think about franchising going forward, is that -- is it sort of the math construct when you're looking at other opportunities? Or are there others where you get kind of more of an EBITDA lift? Or any other way that we should think about franchising going forward from an economic perspective?

Yes, good question. I think that there are certain stores we'll sell where there will actually be a lift in EBITDA, there are some where there may be a bigger drop in EBITDA. But if there is a bigger drop in EBITDA, the sale price is going to have to be significantly higher on a per-store basis than what you're seeing in those last couple of transactions. So it's all about the better store sell for a lot more than the weaker stores, and that's why it's hard to predict. It's very selective. We'll do deals that make financial sense. And even though that sounds like a generic answer, it is a generic answer because you really have to look at each one individually and selectively and figure out if it's the better the store, the higher price has to be or we won't sell them and vice versa.

Okay, got it. That makes sense. Separately, so on the revenue side, so I understand that this is a portfolio business. So I'm kind of wondering when you give your 2019 revenue guidance, is there a way to say how much visibility you have in that revenue guidance? So is there -- would you be able to put a number to say we've already -- say, our portfolio already has contracted 60% of the revenues we have in our 2019 guidance? Or is there kind of a way to think about it since your average term is about 16 months that you should be able to see through 2019?

Well, yes, you get -- you have some -- there's some vision to it, visibility to it. Yes, the average term is 16 months, but actually, on rent average, it's more like 5 as far as -- versus what we write in the rent-to-own contract versus what actually happens. So we have some visibility. We already said we went into the year with our portfolio being 3% higher than where it was a year ago. There's still a little room to add on from a collections standpoint or a less promotional standpoint to maybe add a little more to that. But there's really, Vince, there's 2 ways you'd grow your same-store sales business. You grow the portfolio, or you collect your money better. The portfolio is 3% higher going into the year. We think we can add to that. And there's some opportunity to collect better. If you think about our guidance from low single digits to mid-single digits, we started the year at 3% ahead in the portfolio, and as we go through the year, we can add onto that. So we're already, as we go into the year, in pretty good shape relative to the guidance.

Okay. That's helpful. Could you talk about the collections side of it? So when you talk about improving collections, when you think about it year-over-year, anything, any actions you can point to that, that is going to improve year-over-year?

Well, a lot of it -- collecting our money starts with what our promotion is and how much money we give away on the front and. And when you have the best value proposition in the industry like we now have with using either 120- or 180-day same-as-cash and the competitive pricing we have, targeted pricing, depending on the product category, when you do that, you don't have to run as many low barrier to entry promotions, like $5 rents for the first week and so forth. You could -- you'd still do some of those, but you don't have to do as many. So you collect more by being less promotional. And then just once it's on rent, how is your collection rate? And our collection is in pretty good shape right now. The operations team is doing a good job with that. And there is still another -- when I combine promotional and what we collect after the fact, it's probably another percent that we can get out of that this year when I add those 2 together. So when we start thinking about 3% in the portfolio going into the year, we can add to that because our traffic remains strong. We can add another percent based on the collections between promotional and credit, if you will. So we can get -- the high end of the range, that mid-single digit is very, very doable. And as we -- one of the things we're really focused on is signing our customers up on AutoPay, which helps with the collections. You can get another -- you just collect your money faster and better if you get them on the AutoPay program. So a lot of things going on there. I mentioned, the web traffic and, of course, the web customers, the one that's easier to sign up on the AutoPay because they're already on the web. Our new marketing team, with Ann Davids coming back, has done a wonderful job driving more traffic to the web, and we're executing on it, so.

Okay, that's helpful. And the last one from me, just to follow up on John Rowan's question about tax refunds, is there -- I guess, you're seeing a somewhat slower activity. What's the general impact that you see at the store level? So is it more of maybe there's less payouts, but there's more people are taking out to try to kind of tide over the next couple of 2 months-or-so? Or are you actually seeing more activity? Or what generally are the tax refund impacts that you're seeing year-over-year?

Just that you'd see less payouts, which, on one hand, is less revenue today but the portfolio stays higher than we forecasted. So -- and then if the payouts do catch up, like they would in a normal tax season, that's what we expected anyhow. And then the impact on the portfolio will be there, but then you have a lot of cash from the payout. So either way, like I said earlier, either way, you can make -- it works either way. You'd either have a lot more revenue and a little less portfolio, just the way we forecasted, or if we have a little less payout revenue but then the portfolio is higher, and we get more revenue every month going forward the rest of the year. So either way, it will work for us.

[Operator Instructions] Your next question comes from the line of Brad Thomas from KeyBanc Capital Markets.

I wanted to follow up on the topic of customer growth, which has been real encouraging to see. I guess, I was wondering if you all could share any comments on what you're seeing in terms of new customers coming into the stores versus perhaps existing ones that you're convincing to come back to the business.

It's been very strong on new customers and reactivated customers. The tremendous increase we've had on our -- through our website, the e-commerce web orders, if you will, the 62% increase in the fourth quarter, a lot of them are new customers. Like I said earlier, our value proposition is working. Our localized store product assortment is working for the customer. And yes, so it's a lot of new customers as well as reactivations.

Great. And as you think about the drivers of customer growth going forward, Mitch, I mean, how do you feel about things? And what level of confidence do you have that you can continue to drive positive same-store agreement growth 6 months from now and 12 months from now?

Well, we're very, very positive about it. Our guidance is low to mid-single digits from a same-store sales perspective. The product offering is strong. The execution is getting continuously improved on the operations side with customer traffic and the web orders, as I mentioned. We're doing a lot of different things through voice of customer platforms, mystery shopping to keep our operations focused and on their toes. So maybe we can continue to drive but we're still not back to historical levels. So the company had dropped for a few years in a row. So there's still plenty of opportunity to grow and, as I said earlier, and grow stores through the refranchising efforts, not just grow our same-store sales. So we're very optimistic about our future, and why wouldn't we be with coming off a quarter with 9% same-store sales?

Absolutely. If I could ask about CapEx, your guidance of $25 million to $35 million seems a bit light. If you looked at expenditures over the prior -- 5 years prior to you joining, Mitch, I think it averaged about $80 million a year. Could you just talk about what you're able to achieve with that level of spend? And how sustainable that level is for the organization.

Sure. I think we get that question quite a bit as if we're starving the stores or something. And just because we are spending it at such a high level, doesn't mean we -- by not continuing, that means we're starving it or anything. A lot of that, as you know, Brad, was the new POS systems that rolled out in 2016. So that was, from a technology standpoint, we're much more targeted in what we're spending our money on. We're not -- we've got some technology initiatives, one I already mentioned, we've got some going on. It's just more targeted. And the reimaging program for the stores is just a more cost-effective program, it's not like we're not reimaging the stores. So I think it's just -- I think we just got smarter, and it's a more cost-effective reimaging program for the stores and a more targeted approach to technology investment. And I -- Maureen, I don't know if you have anything to add to that. I think we just got smarter on how we spend the money. We're not starving anything.

Right. We invested heavily in technology over the last 2 years, and a lot of those projects are complete. We've also reimaged almost all of our stores within the last 4 to 5 years. So as we go in to stores to reimage them, it's more like a paint and carpet versus a full remodel of the store. So definitely, we feel like both the technology investments and the store maintenance are at appropriate levels.

Great. And if I could squeeze one last one in here. I think it was about a year ago that the company explored the opportunity to sell itself, came to an agreement with Vintage. Ultimately, you all made the decision. As you see it, legally, you had the opportunity to walk away from that transaction, and the stocks couldn't stay higher than it would have been if the company had sold itself. But I guess, as you think about where you are today, should the litigation with Vintage get wrapped up, do you still feel like Rent-A-Center is best positioned to remain a public company? Or does the board feel like it should perhaps, again, review strategic alternatives given where it stands today from a financial perspective?

There is no -- our strategy won't be to go back into a strategic review process. It will be to just continue to operate. Of course, we always have the best interest of our stockholders in mind, so we'll always look at alternatives. But there's no plan once the litigation is wrapped up to go back into a strategic review process.

There are no further questions at this time. Mr. Fadel, I turn the call back over to you for closing remarks.

Thank you, Jessa, and thank you, everyone, for your interest today. I hope the presentation be enough. As we try to talk to the presentation, I hope that works for everybody. It's a new thing for us. We've seen a lot of companies doing it. We thought we would do it ourselves. It seemed to work okay. And now that the presentation is out there on our website for anybody to review and review against our transcript and those kind of things. So hopefully, you found that helpful. We enjoyed reporting to you. Of course, when the numbers are good like this, it's easy, right? It's a lot more fun. So we're going to go back to work, try to put another great year together. And we appreciate your support. Thank you, everyone.

This concludes today's conference call. You may now disconnect.