Dollar Financial Corp Announces Fiscal 2007 Second Quarter Results and Raises Guidance.

Results Driven by Strong International Revenue Growth of 39.7% and Consolidated Same Store Sales Growth of 11.2%

BERWYN, Pa. -- Dollar Financial Corp (NASDAQ:DLLR), a leading international financial services company serving under-banked consumers, today announced results for the fiscal 2007 second quarter.

Fiscal 2007 second quarter highlights (compared to the prior year period):

* Consolidated net revenue was $102.1 million, an increase of 26.6% or $21.4 million.

* Revenue from the Company's international operations increased by 39.7% or $20.8 million.

* Total comparable store sales increased 11.2%.

* Comparable store sales for the international businesses increased by 15.6%.

* Store and regional margin was 36.7% of total revenue, compared to 34.7% for the prior year.

* Adjusted EBITDA was $27.9 million, an increase of 44.2% or $8.6 million.

* Pro forma income before income taxes was $14.7 million, an increase of 60.5% or $5.5 million.

Commenting on the results, Jeff Weiss, the Company's Chairman and Chief Executive Officer, stated, "The Company realized another solid quarter of operating results, driven by strong revenue growth across both our foreign and domestic markets. During the quarter, we followed through on our commitment to substantially improve our balance sheet with the refinancing of our long term debt and the recent currency-swap transactions. We also continued to execute on our strategy of being the most diversified company in the industry, completing two significant acquisitions including an 82 store Canadian franchise acquisition and a 23 store acquisition in Southwest Florida. Overall, I am very pleased with the progress we have made during the quarter and am confident that our multinational, multi-product and multi-channel strategy will continue to fuel our growth and generate shareholder value."

Consolidated check cashing revenue increased by 17.9% or $6.3 million, as the Canadian business segment grew by 32.0% or $4.1 million and U.K. check cashing revenue increased by 20.5% or $2.2 million. The U.S. check cashing business was approximately flat to the prior year. On a consolidated basis, the face amount of the average check cashed increased 7.0% to $472 compared to $441 for the prior year, and the average fee per check cashed increased by 9.7% to $18.10.

For the quarter ended December 31, 2006, consolidated net consumer lending revenue increased by 38.7%, or $12.9 million compared to the prior year, driven by strong growth across all three business units. Consumer lending revenue in the Company's international businesses grew by a very strong 55.6% or $11.6 million, while consumer lending revenue in the U.S. market grew by 10.9%. The consolidated loan loss provision for the quarter, as a percentage of gross consumer lending revenue, decreased to 18.5% as compared to 18.9% for the prior year.

Total Company funded loan originations were $339.3 million for the quarter ended December 31, 2006, representing a net increase of 32.1% or $82.5 million compared to the prior year. Company funded loan originations in the U.S. increased by $9.6 million or 15.5%, Canadian loan originations increased by 42.7% or $61.4 million, while loan originations in the U.K. increased by 22.6% or $11.5 million.

Money transfer fees increased 27.6% or $1.2 million, primarily driven by growth in the Company's international markets. Other revenue increased by 13.3% or $1.0 million for the quarter ended December 31, 2006, principally due to strong MasterCard[R] branded debit-card sales in the Canadian and U.K. business units, as well as growth in the foreign currency product in both the Canadian and U.K. businesses.

Comparable store sales increased 11.2% or $8.6 million for the second quarter, and on a constant currency basis increased by 7.4% or $5.9 million. On a local currency basis, the Company's Canadian operations achieved comparable store sales growth of 10.6%, the U.K. business generated comparable store sales growth of 8.5%, while U.S. comparable store sales increased by 3.5%.

The Company realized a store and regional margin of $37.5 million or 36.7% of total net revenue for the second quarter, compared to $28.0 million or 34.7% of net revenue for the prior year. The improved margin performance was driven primarily by strong revenue growth during the quarter.

Corporate expenses, as a percentage of net revenues, were consistent with the prior year's quarter at 12.9%. This was achieved even though the Company was required to recognize stock based compensation in the current quarter in accordance with FAS 123R which totaled $0.8 million. Excluding the impact of the FAS 123R expenses, corporate expenses as a percentage of revenue declined from 12.9% to 12.2% of total revenue.

In the second quarter of fiscal 2007, the Company incurred $51.6 million of one-time charges including:

1) $23.8 million of costs related to the refinancing of the $200.0 million U.S. Senior Notes;

2) $6.6 million of non-cash charges associated with the mark-to-market adjustment of the Company's foreign term loans; and

3) $21.2 million of net charges associated with the reorganization of the We The People business unit, net of approximately $3.25 million of one-time income associated with the settlement of litigation with IDLD, Inc., the former owner of the We The People business.

Also in the second quarter, the Company completed cross currency-swap transactions which synthetically converted the $375.0 million U.S. dollar denominated foreign term loans into local currency denominated loans. These swap transactions also lowered the combined interest rate on the aggregate $375.0 million debt issuance to a blended fixed rate of 7.4%, which will result in an annual cash interest expense savings of approximately $2.5 million as compared to the applicable floating interest rates at the time the swap transactions were completed.

On a pro forma basis, excluding the $51.6 million of net one-time charges detailed above, pro forma income before income taxes was $14.7 million, representing an increase of 60.5% or $5.5 million over the prior year's second quarter results. The Company expects a more normalized income tax rate of 37% to 39% in the third quarter ending March 31, 2007, which will be the first full quarter in which the Company's long-term debt is domiciled in its international subsidiaries. Furthermore, the third quarter will not be impacted by the tax effects of the one-time charges recorded in the second quarter.

As a result of the one-time charges, the Company incurred a net loss for the quarter and fully diluted earnings per share, the calculation of which includes the 5,000,000 additional shares related to the June 2006 follow-on common stock offering, was a loss of $2.23 compared to earnings per share of $0.16 (computed on the lesser number of shares outstanding) for the previous year. Excluding the one-time charges described above, pro forma earnings per share were $0.38 for the quarter representing an increase of $0.07 per share over the prior year period.

The Company opened ten company-owned financial services stores in the second quarter, of which six were in the Canadian market and four in the U.K. market.

Fiscal Year 2007 Earnings Guidance

Excluding the aforementioned $51.6 million of net one-time charges, the Company is increasing its previously announced fiscal 2007 guidance. Revenue is now expected to be between $400.0 million and $405.0 million, Adjusted EBITDA between $112.0 million and $114.0 million, and pro forma income before income taxes of between $66.0 and $68.0 million.

Calendar Year 2007 Earnings Guidance

The Company is also increasing its previously announced calendar year 2007 guidance for revenue between $450.0 million and $460.0 million, Adjusted EBITDA of $127.0 million to $132.0 million, income before income taxes of $78.0 million to $80.0 million, and earnings per share of between $1.95 to $2.05.

The reconciliation between Adjusted EBITDA and income before income taxes is consistent with the historical reconciliation as presented at the end of this news release.

Investors Conference Call

Dollar Financial Corp will be holding an investor's conference call on Wednesday, January 31, 2007 at 5:00 pm EST to discuss the Company's results for the 2007 fiscal second quarter. Investors can participate in the conference by dialing 888-868-9078 (U.S. and Canada) or 973-935-8509 (International); use the confirmation code "Dollar". Hosting the call will be Jeff Weiss, Chairman and CEO, Don Gayhardt, President, and Randy Underwood, Executive Vice President and CFO. For your convenience, the conference call can be replayed in its entirety beginning at 7:00 pm Eastern Time on January 31, 2007 through February 7, 2007. If you wish to listen to the replay of this conference call, please dial 973-341-3080 and enter passcode "8352223".

The conference call will also be broadcast live through a link on the Investor Relations page on the Dollar Financial web site at http://www.dfg.com. Please go to the web site at least 15 minutes prior to the call to register, download and install any necessary audio software.

About Dollar Financial Corp

Dollar Financial Corp is a leading international financial services company serving under-banked consumers. Its customers are typically service sector individuals who require basic financial services but, for reasons of convenience and accessibility, purchase some or all of their financial services from the Company rather than from banks and other financial institutions. To meet the needs of these customers, the Company provides a range of consumer financial products and services primarily consisting of check cashing, short-term consumer loans, Western Union money order and money transfer products, reloadable VISA[R] and MasterCard[R] branded debit cards, electronic tax filing, bill payment services, and legal document preparation services.

At December 31, 2006, the Company's global store network consisted of 1,282 stores, including 883 company-operated financial services stores and 127 We The People legal document preparation locations in 34 states, the District of Columbia, Canada and the United Kingdom. The financial services store network is the largest network of its kind in each of Canada and the United Kingdom and the second-largest network of its kind in the United States. The Company's customers, many of whom receive income on an irregular basis or from multiple employers, are drawn to the convenient neighborhood locations, extended operating hours and high-quality customer service. The Company's products and services, principally check cashing and short-term consumer loan programs, provide immediate access to cash for living expenses or other needs. For more information, please visit the Company's website at www.dfg.com.

Forward Looking Statement

This news release contains forward looking statements, including statements regarding the Company's future results, growth and operating strategy, restructuring initiatives, the impact of new stores and acquisitions, the debt refinancing and cross-currency swap transactions, and of the performance of new products. These forward looking statements involve risks and uncertainties, including risks related to the regulatory environment, current and potential future litigation, the integration of acquired stores, the performance of new stores, the implementation of restructuring initiatives, and the effects of new products on the Company's business, results of operations, financial condition and prospects. There can be no assurance that the Company will attain its expected results, successfully integrate any of its acquisitions, or that ongoing and potential future litigation or that the various FDIC, Federal, state or foreign legislative or regulatory activities affecting the Company or the banks with which the Company does business will not negatively impact the Company's operations. A more complete description of these and other risks, uncertainties and assumptions is included in the Company's filings with the Securities and Exchange Commission, including those described under the heading "Risk Factors" in the final prospectus from the Company's follow-on public offering filed with the SEC on June 16, 2006 and its fiscal 2006 annual report on Form-10K. You should not place any undue reliance on any forward-looking statements. We disclaim any obligation to update any such factors or to publicly announce results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

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Adjusted EBITDA Reconciliation

Adjusted EBITDA is not an item prepared in accordance with GAAP. Adjusted EBITDA is earnings before interest expense, income tax provision, depreciation, amortization, charges related to incentive stock options and restricted shares, loss on extinguishment of debt, restructuring costs and other items described below. Dollar presents Adjusted EBITDA as an indication of operating performance and its ability to service its debt and capital expenditure requirements. Adjusted EBITDA does not indicate whether Dollar's cash flow will be sufficient to fund all of its cash needs. Adjusted EBITDA should not be considered in isolation or as a substitute for net income, cash flows from operating activities, or other measures of operating performance or liquidity determined in accordance with GAAP. Dollar believes that Adjusted EBITDA amounts should be considered by prospective investors because Dollar uses them as one measure of analyzing its ability to service its debt and capital expenditure requirements, and Dollar understands that they are used by some investors as one measure of a Company's historical ability to service its debt and capital expenditure requirements. Not all companies calculate Adjusted EBITDA in the same fashion, and therefore these amounts as presented may not be comparable to other similarly titled measures of other companies. The table below reconciles income before income taxes as reported on Dollar's Interim Unaudited Consolidated Statements of Operations to Adjusted EBITDA (dollars in thousands):

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