- Total Income $12.3 million, an Increase of 18% from prior year
- Increased Revenues Reported in All Business Segments
- Net Income Attributable to Asta Funding of $1.8 Million, or $0.15 Per Diluted Share
- Strong Balance Sheet, No Impairments, Strong Liquidity Position Continues
ENGLEWOOD CLIFFS, N.J., Feb. 09, 2016 (GLOBE NEWSWIRE) -- Asta Funding, Inc. (NASDAQ:ASFI) (the “Company”), a diversified financial services company, today announced earnings for the first quarter of the 2016 fiscal year, the three-month period ended December 31, 2015.
For the three months ended December 31, 2015, the Company reported net income attributable to Asta Funding, Inc. of $1,806,000, or $0.15 per diluted share, as compared to net income attributable to Asta Funding, Inc. of $370,000, or $0.03 per diluted share for the comparable period of fiscal year 2015. Net income before non-controlling interest is $2,335,000, a significant improvement over the $321,000 reported in the prior year. Total income was $12,335,000 for the quarter ended December 31, 2015, as compared to $10,462,000 for quarter ended December 31, 2014, an increase of $1,873,000, or 18%. For the three month period ended December 31, 2015, revenues from personal injury claims increased $597,000, or 24%, to $3,085,000 from $2,488,000 reported in the three month period ended December 31, 2014. We have an invested balance of $34.6 million in personal injury cases at December 31, 2015. Revenues from structured settlements through our CBC Settlement Funding business segment were $2,934,000 in the three month period ended December 31, 2015 as compared to $2,143,000 in the first quarter of fiscal year 2015, a 36.9% increase. At December 31, 2015 we had an invested balance of $69,982,000 in structured settlements. Disability fee income reported in the first quarter of fiscal year 2016 was $659,000, increasing $500,000 from $159,000 reported in the first quarter of fiscal year 2015.
General and administrative expenses were $8,239,000 for the three month period ended December 31, 2015, as compared to general and administrative expenses of $9,554,000 for the same period in the prior year. General and administrative expenses decreased primarily due to lower loss reserves related to personal injury claims. In addition, general and administrative expenses which are related to GAR Disability Advocates increased related relative to the growth of the segment. Also, at the corporate level, there was a decrease in professional fees and outside consulting fees, as we continue our efforts in various cost containment programs.
Interest expense was $728,000 in the first quarter of fiscal year 2016 as compared to interest expense of $489,000 reported in the first quarter of fiscal year of 2015. The increase in interest expense is related to the growth in our structured settlement business segment CBC Settlement Funding, LLC. Our invested balance in structured settlements has increased over 50% since December 31, 2014.
Net cash collections of consumer receivables acquired for liquidation for the quarter ended December 31, 2015 totaled $7,293,000. This compares to the prior year’s total net cash collections of $8,750,000 reported in the comparable prior year period. Net cash collections on the Great Seneca portfolio were $1,718,000 in the first quarter of fiscal year 2016 as compared to $2,286,000 in the first quarter of fiscal year 2015. The carrying value of the Great Seneca portfolio at December 31, 2015 was $8.8 million, as compared to $17.0 million at December 31, 2014. We invested approximately $4.4 million in consumer receivable portfolios in the international sector in the first quarter of fiscal year 2016. There were no consumer portfolio acquisitions in the first quarter of fiscal year 2015. The Company invested approximately $7.0 million in personal injury cases during the first quarter of fiscal year 2016 as compared to $6.3 million in the first quarter of fiscal year 2015. Collections on personal injury claims totaled $9.0 million in the first quarter of fiscal year 2016, as compared to $5.3 million during the first quarter of fiscal year 2015.
The Company repurchased 834,000 shares of Asta Funding, Inc. common stock during the quarter ended December 31, 2015. Total repurchased shares since the inception of the most recent share buyback programs is 1,035,800 at an average price of $8.60.
Gary Stern, Chairman, President and CEO of the Company commented, “We are very pleased by the results of first quarter of fiscal year 2016.There was revenue growth in all business segments, and coupled with our strong liquidity and a solid balance sheet, we are well positioned as we move through the rest of the fiscal year. The major event of the quarter was the purchase of the 20% interest of CBC Settlement Funding, LLC, which the Company did not already own. CBC has been very successful since our original investment in the company in December of 2013 and moving forward Asta Funding will benefit 100% in the anticipated continued success. William Skyrm and James Goodman, the founders of CBC Settlement Funding, will continue to manage the business segment and we thank them for their continued efforts.” Mr. Stern continued, “Our strong balance sheet puts us in an excellent position to continue funding our investment opportunities, without the immediate need for external financing. We look forward to continued success for the Company for the rest of the year.”
A conference call to discuss the results of the first quarter of fiscal year 2016 will be held on Tuesday, February 9, 2016 at 4:00PM, EST.
Conference Call Details
Toll-free dial-in number (U.S. and Canada):
(800) 668-4132
International dial-in number:
(224) 357-2196
Conference ID
46142035
Phone Replay:
Toll-Free #: (800) 585-8367
Toll #: (404) 537-3406
Conference ID # 46142035
Recording will be available from: 02/9/2016 7:00 PM EST to 02/16/2016 11:59 PM EST
About Asta Funding:
Based in Englewood Cliffs, NJ, Asta Funding, Inc., is engaged in several business segments in the financial services industry including structured settlements through our wholly owned subsidiary CBC Settlement Funding, LLC (www.cbcsettlementfunding.com.), funding of personal injury claims, through our 80% owned subsidiary Pegasus Funding, LLC, social security and disability benefit advocacy, through our wholly owned subsidiary GAR Disability Advocates, LCC and the business of managing for its own account the servicing of distressed consumer receivables with the concentration of acquiring consumer receivables in the international sector. For additional information, please visit our website at http://www.astafunding.com.
Important Information about Forward-Looking Statements:
Important Information about Forward-Looking Statements: All statements in this new release other than statements of historical facts, including without limitation, statements regarding our future financial position, business strategy, budgets, projected revenues, projected costs, and plans and objectives of management for future operations, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expects," "intends," "plans," "projects," "estimates," "anticipates," or "believes" or the negative thereof, or any variation thereon, or similar terminology or expressions. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Important factors which could materially affect our results and our future performance include, without limitation, our ability to purchase defaulted consumer receivables at appropriate prices, changes in government regulations that affect our ability to collect sufficient amounts on our defaulted consumer receivables, our ability to employ and retain qualified employees, changes in the credit or capital markets, changes in interest rates, deterioration in economic conditions, negative press regarding the debt collection industry which may have a negative impact on a debtor’s willingness to pay the debt we acquire, and statements of assumption underlying any of the foregoing, as well as other factors set forth under "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended September 30, 2015 and other filings with the SEC. All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the foregoing. Except as required by law, we assume no duty to update or revise any forward-looking statements.
| ASTA FUNDING, INC. AND SUBSIDIARIES | ||||||||||||
| Condensed Consolidated Statements of Income | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months | Three Months | |||||||||||
| Ended | Ended | |||||||||||
| December 31, 2015 | December 31, 2014 | |||||||||||
| Revenues | ||||||||||||
| Finance income, net | $ | 5,142,000 | $ | 5,037,000 | ||||||||
| Personal injury claims income | 3,085,000 | 2,488,000 | ||||||||||
| Unrealized gains on structured settlements | 1,527,000 | 1,202,000 | ||||||||||
| Interest income on structured settlements | 1,407,000 | 941,000 | ||||||||||
| Disability fee income | 659,000 | 159,000 | ||||||||||
| Total revenues | 11,820,000 | 9,827,000 | ||||||||||
| Other income (includes ($31,000) and 39,000 during the three month periods ended December 31, 2015 and 2014, respectively, of accumulated other comprehensive income reclassification for unrealized net (losses)/income on available for sale securities) | 515,000 | 635,000 | ||||||||||
| 12,335,000 | 10,462,000 | |||||||||||
| Expenses | ||||||||||||
| General and administrative | 8,239,000 | 9,554,000 | ||||||||||
| Interest expense | 728,000 | 489,000 | ||||||||||
| 8,967,000 | 10,043,000 | |||||||||||
| Income before income taxes | 3,368,000 | 419,000 | ||||||||||
| Income tax expense (includes tax benefit/(expense) of $11,000 and ($9,000) during the three month periods ended December 31, 2015 and 2014, respectively, of accumulated other comprehensive income reclassifications for unrealized net losses on available for sale securities) | 1,033,000 | 98,000 | ||||||||||
| Net income | 2,335,000 | 321,000 | ||||||||||
| Less: net income attributable to non-controlling interest | 529,000 | (49,000 | ) | |||||||||
| Net income attributable to Asta Funding, Inc. | $ | 1,806,000 | $ | 370,000 | ||||||||
| Net income per share attributable to Asta Funding, Inc.: | ||||||||||||
| Basic | $ | 0.15 | $ | 0.03 | ||||||||
| Diluted | $ | 0.15 | $ | 0.03 | ||||||||
| Weighted average number of shares outstanding: | ||||||||||||
| Basic | 12,155,421 | 13,013,719 | ||||||||||
| Diluted | 12,431,886 | 13,308,573 | ||||||||||
| ASTA FUNDING, INC. AND SUBSIDIARIES | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (Unaudited) | ||||||||
| December 31, | September 30, | |||||||
| 2015 | 2015 | |||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 22,504,000 | $ | 24,315,000 | ||||
| Available for sale investments | 55,045,000 | 59,727,000 | ||||||
| Consumer receivables acquired for liquidation (at net realizable value) | 17,843,000 | 15,608,000 | ||||||
| Structured settlements | 69,982,000 | 64,635,000 | ||||||
| Investment in personal injury claims | 34,632,000 | 36,668,000 | ||||||
| Other investments | 4,183,000 | 4,239,000 | ||||||
| Due from third party collection agencies and attorneys | 929,000 | 1,422,000 | ||||||
| Prepaid and income taxes receivable | 5,838,000 | 6,744,000 | ||||||
| Furniture and equipment, net | 386,000 | 480,000 | ||||||
| Deferred income taxes | 12,955,000 | 12,279,000 | ||||||
| Goodwill | 2,770,000 | 2,770,000 | ||||||
| Other assets | 8,908,000 | 8,485,000 | ||||||
| Total assets | $ | 235,975,000 | $ | 237,372,000 | ||||
| LIABILITIES | ||||||||
| Other debt – CBC (including non-recourse notes payable amounting to $46.0 million at December 31, 2015 and $47.0 million at September 30, 2015) | $ | 55,917,000 | $ | 51,611,000 | ||||
| Other liabilities | 3,980,000 | 4,441,000 | ||||||
| Total liabilities | 59,897,000 | 56,052,000 | ||||||
| Commitments and contingencies | ||||||||
| STOCKHOLDERS’ EQUITY | ||||||||
| Preferred stock, $.01 par value; authorized 5,000,000 shares; issued and outstanding — none | — | — | ||||||
| Common stock, $.01 par value, authorized 30,000,000 shares; issued 13,189,977 at December 31, 2015 and 13,061,673 at September 30, 2015; and outstanding 12,154,177 at December 31, 2015 and 12,859,873 at September 30, 2015 | 132,000 | 131,000 | ||||||
| Additional paid-in capital | 65,420,000 | 65,011,000 | ||||||
| Retained earnings | 122,417,000 | 120,611,000 | ||||||
| Accumulated other comprehensive income | (1,127,000 | ) | (1,685,000 | ) | ||||
| Treasury stock (at cost) 1,035,800 shares at December 31, 2015 and, 201,800 shares at September 30, 2015 | (8,931,000 | ) | (1,751,000 | ) | ||||
| Non-controlling interest | (1,833,000 | ) | (997,000 | ) | ||||
| Total stockholders’ equity | 176,078,000 | 181,320,000 | ||||||
| Total liabilities and stockholders’ equity | $ | 235,975,000 | $ | 237,372,000 | ||||