TAMPA, Fla., Aug. 12 /PRNewswire/ -- IMC Mortgage Company
(Nasdaq-NNM: IMCC) reports results:
Second Quarter 1997 Highlights:
-- Net income increased 193% to $10.7 million.
-- Earnings per share increased 64% to $0.36.
-- Total loans originated or purchased increased 245% to $1.39 billion.
-- Retail and broker originations increased 800% to $290 million.
-- Closed a $800 million securitization.
-- Completed the fifth acquisition in 1997, The National Lending Center,
Inc.
-- Successfully completed a 6.3 million-share common stock offering,
resulting in $58 million of net new equity.
-- Relocated corporate headquarters to an expanded location in Tampa.
IMC Mortgage Company (IMC) announced today record financial and
operational results. Earnings per share were $.36 for the second quarter and
total loan volume was $1.39 billion.
Net income of $10.7 million and $19.7 million was reported, respectively,
for the three and six month periods ended June 30, 1997 compared to pro forma
net income of $3.7 million and $5.3 million for the three and six month period
ending June 30, 1996. The associated fully diluted earnings per share figures
are $.36 and $.69 for the three and six month period ending June 30, 1997
compared to the pro forma earnings per share of $.21 and $.31 for the
respective periods in 1996. (All per share figures reflect the 2:1 stock split
paid on Feb. 13, 1997).
In April, the Company completed an equity offering of 6.3 million shares
of IMC common stock, resulting in $58 million in proceeds to the Company after
issuance expenses. This stock offering adds strength to the balance sheet and
positions the Company for future growth.
George Nicholas, Chairman and Chief Executive Officer of IMC, stated, "We
are very pleased with the operational and financial results for the quarter.
We remain committed to our long-term strategy to maintain financial
flexibility, as is illustrated by the $1.5 billion of 'loans held for sale' on
the balance sheet. We believe that it is a prudent strategy to manage this
rolling portfolio of loans, thus providing the flexibility to tap the
securitization markets at any time and take advantage of attractive market
opportunities. Additionally, the net warehouse interest income earned from
these loans is a beneficial source of cash revenue."
Following on Mr. Nicholas' remarks, Stu Marvin, CFO, added, "Cash revenues
provided from net warehouse interest income and servicing fees, when combined,
covered approximately 80% of IMC's compensation and benefits expense for the
quarter." Mr. Marvin further comments, "The mortgage loans held for sale of
$1.5 billion are available for future securitizations and will be reflected in
earnings in the period in which the loans are sold and the gain is recorded."
Loan Origination Volume
Loans originated or purchased during the second quarter of 1997 totaled
$1.39 billion representing a substantial increase from $402 million during the
second quarter of 1996. Correspondent loan volume was $1.1 billion for the
quarter compared to $370 million for the second quarter of 1996. Loans
originated through IMC's network of mortgage brokers represented $84 million
compared to $25 million for the 1996 quarter. IMC's retail offices originated
$206 million for the quarter, an increase from $7 million in the second
quarter of 1996.
Tom Middleton, President and Chief Operating Officer, remarked, "The
significant increase in retail originations is primarily the result of the
four acquisitions closed in the first quarter of 1997. Each of the four
companies has a retail origination focus. Together, they have accelerated
IMC's growth in retail originations ahead of our original plans." He
continued, "Our most recent acquisition, which closed in July, primarily
originates through the broker channel. Therefore, we expect an increase in
the dollar contribution from the broker origination channel in future
periods."
IMC originates and purchases residential mortgage loans through a network
of correspondents and mortgage brokers, and through an expanded network of
retail offices. As of June 30, 1997, IMC had a network of 486 approved
correspondents and 1,883 approved mortgage brokers.
Securitization Activity
Loan Securitization activity totaled $800 million for the second quarter
of 1997. This was the first senior/subordinated securitization offered by the
Company. The ratings for the ten certificate classes by Moody's Investors
Service, Inc. and Fitch Investors Service, L.P. are as follows: Aaa/AAA for
Class A-1 through A-7, Aa2/AA+ for Class M-1, A2/A+ for class M-2, and
Baa3/BBB for class B certificates.
Serviced Loan Portfolio
The serviced loan portfolio as of June 30, 1997 was $4.0 billion, an
increase from $1.1 billion at June 30, 1996. The percent of loans in the
portfolio delinquent more than 30 days, including loans in foreclosure or
bankruptcy, was 6.79% at June 30, 1997 as compared to 6.76% on March 31, 1997.
Net loan losses for the three months ended June 30, 1997 represent 4 basis
points (16 basis points annualized) of the average serviced loan portfolio.
The six-month net loss experience for 1997 equals 8 basis points (16 basis
points annualized) of the average serviced loan portfolio. These delinquency
and loss rates continue in line with management expectations.
On July 7, 1997, IMC moved its headquarters to a new location in Tampa.
The building, previously occupied by a supermarket chain, was purchased by IMC
in late 1996 and renovated over the last five months to meet IMC's needs. The
new location provides ample space for additional growth of the Tampa-based
staff.
IMC Mortgage Company is a leading consumer finance company engaged in
purchasing, originating, servicing and selling non-conforming home equity
loans secured primarily by first liens on one-to-four family residential
properties. The Company has wholesale and retail operations in the United
States. The Company has operations in the United Kingdom through a joint
venture and recently opened in Ontario, Canada.
Certain statements in this press release and the conference call relating
to this press release, concerning volume of loans, acquisitions, business
strategy and future operations are forward-looking statements. There are a
number of important factors that could cause the actual results of IMC
Mortgage Company to differ materially from those indicated in such
forward-looking statements. Those factors include, but are not limited to,
residential real estate values, competition, general economic conditions such
as changes in interest rates and the demand for non-conforming loans,
availability of funding, loan prepayment rates, delinquency and default rates,
changes which influence the loan securitization market generally, and other
"risks factors" identified in IMC Mortgage Company's Securities and Exchange
Commission filings.
IMC Mortgage Company and Subsidiaries
Condensed Consolidated Statements of Operations
Three months ended Six months ended
June 30, June 30,
1997 1996 1997 1996
REVENUES
Gain on sale of loans $32,231,567 $9,986,380 $59,951,394 $18,033,256
Net warehouse interest
income 9,201,892 1,996,306 15,154,421 3,782,004
Servicing fees 3,808,326 1,466,803 6,849,236 2,462,242
Other 4,530,905 835,709 6,239,234 l,464,245
Total revenues 49,772,690 14,285,198 88,194,285 25,741,747
EXPENSES
Operating expenses 29,441,437 7,268,819 51,361,773 13,176,360
Other interest expense 3,119,342 1,005,057 4,981,819 1,347,591
Sharing of proportionate
value of equity -- -- -- 2,555 000
Total expenses 32,560,779 8,273,876 56,343,592 17,078,951
Income before provision
(benefit) for income
taxes 17,211,911 6,011,322 31,850,693 8,662,796
Provision (benefit) for
income taxes 6,500,000 (3,60O,000) 12,20O,000 (3,600,000)
Net income $10,711,911 $9,611,322 $19,650,693 $12,262,796
Pro forma data (giving
effect to provision
for income taxes):
Income before provision
for income taxes $17,211,911 $6,011,322 $31,850,693 $8,662,796
Pro forma provision
(actual provision for
the three months and
six months ended
June 30, 1997) for
income taxes 6,500,000 2,358,522 12,200,000 3,384,522
Pro forma (actual for
the three and six months
ended June 30, 1997)
net income $10,711,911 $3,652,800 $19,650,693 $5,278,274
Pro forma (actual for
the three and six
months ended June 30,
1997) net income per
common share:
Primary $0.36 $0.22 $0.70 $0.33
Fully diluted $0.36 $0.21 $0.69 $0.31
Weighted average number
of shares outstanding
Primary 29,760,782 16,434,386 27,960,852 16,199,332
Fully diluted 30,091,856 17,102,420 28,287,334 16,779,820
IMC Mortgage Company and Subsidiaries
Condensed Consolidated Balance Sheets
June 30, 1997 December 31, 1996
ASSETS
Cash and equivalents $19,727,259 $13,289,128
Securities purchased under
agreements to resell 658,800,000 659,490,000
Mortgage loans held for sale 1,543,477,641 914,586,703
Interest-only and residual
certificates 206,572,219 86,246,674
Other assets 113,294,610 33,735,680
Total assets $2,541,871,729 $1,707,348,185
LIABILITIES AND STOCKHOLDERS' EQUITY
Warehouse finance facilities $1,534,614,769 $895,132,545
Term debt 127,179,542 47,430,295
Accrued and other liabilities 27,857,654 14,387,602
Securities sold but not yet purchased 661,614,496 661,061,161
Total liabilities 2,351,266,461 1,618,011,603
Total stockholders' equity 190,605,268 89,336,582
Total liabilities and stockholders'
equity $2,541,871,729 $1,707,348,185
SOURCE IMC Mortgage Company
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CONTACT:
Jean S. Schwindt, CFA, Vice President -
Investor Relations & Strategic Planning, 813-984-2515, or Stuart
D. Marvin, CPA, Chief Financial Officer, 813-984-2548, both of
IMC Mortgage Company
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