Revenue during the quarter dropped 12.35 percent to $693.88 million from $791.60 million in the previous year period. Gross margin for the quarter expanded 417 basis points over the previous year period to 65.89 percent. Total expenses were 97.59 percent of quarterly revenues, down from 99.17 percent for the same period last year. This has led to an improvement of 158 basis points in operating margin to 2.41 percent.

Operating income for the quarter was $16.70 million, compared with $6.56 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $37.65 million compared with $72.18 million in the prior year period. At the same time, adjusted EBITDA margin contracted 369 basis points in the quarter to 5.43 percent from 9.12 percent in the last year period.

“As previously announced, our third quarter operating results were negatively impacted by unexpected capacity-related system outages following the full implementation of our new store information management system within our Core U.S. stores. Consequently, I am terribly disappointed in the results for the quarter, both top and bottom line. Toward the end of the third quarter we had seen significant improvement in system availability and a reduction in the frequency of system outages. However, over the past two weeks on a couple of instances we have experienced system slowness and outages similar to but less impactful than what we saw earlier in the third quarter. Despite these recent challenges, over the past 6 weeks, past due percentages have been lower than they were a year ago,” said Robert D. Davis, the chief executive officer of Rent-A-Center, Inc.

For financial year 2016, the company projects diluted earnings per share to be in the range of $1.05 to $1.15 on adjusted basis.