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Asta Funding, Inc. Announces Financial Results for Year and Fourth Quarter of Fiscal Year 2012



Asta Funding, Inc. Announces Financial Results for Year and Fourth Quarter of
Fiscal Year 2012

 Revenues of $11.0 million in Fourth Quarter Fiscal Year 2012 – Increase over
                          Prior Year Fourth Quarter

           Solid Cash Position and Strong Cash Flow Trend Continues

 $106.3 Million of Cash and Cash Equivalents and Investments at September 30,
                                     2012

Net Income $10.0 Million, or $0.70 Per Diluted Share for Year Ended September
                                   30, 2012

                  Annual $0.08 Dividend Accelerated to 2012

ENGLEWOOD CLIFFS, N.J., Dec. 13, 2012 (GLOBE NEWSWIRE) -- Asta Funding, Inc.
(Nasdaq:ASFI) (the "Company"), a financial services consumer receivable asset
management and liquidation company, today reported its results for the fiscal
year and fourth quarter ended September 30, 2012. The Company reported total
revenues of $11,022,000 in the fourth quarter of fiscal year 2012, an increase
of 12.5% over the reported revenue of $9,798,000 in fourth quarter of fiscal
year 2011. The Company reported $106.3 million in cash and cash equivalents,
and investments at September 30, 2012.

Fiscal Year 2012

The Company reported net income of $10,037,000 for the fiscal year ended
September 30, 2012, or $0.70 per diluted share, as compared to net income of
$10,521,000, or $0.71 per diluted share, for the fiscal year ended September
30, 2011. Total revenues for the fiscal year ended September 30, 2012 were
$44,502,000, an increase of 3.1% as compared to $43,167,000 for the fiscal
year ended September 30, 2011.

Net cash collections from collection of receivables acquired for liquidation,
including net cash collections represented by account sales, were $70,019,000
for the fiscal year ended September 30, 2012, as compared to $81,205,000
during fiscal year 2011, a 13.8% decrease from the prior year. Collections on
the Great Seneca portfolio were $12.9 million during fiscal year 2012 as
compared to $13.0 during the prior year. The carrying value of the Great
Seneca portfolio was $65.4 million at September 30, 2012 as compared to $78.3
million at September 30, 2011.

Income from fully amortized portfolios (zero basis revenue) was $36.4 million
for the fiscal year ended September 30, 2012, an increase of $2.1 million over
the $34.3 million reported for the fiscal year ended September 30, 2011. The
results of the fourth quarter of fiscal year 2011 included a one-time charge
of $1.3 million for invoicing of previously unbilled collection costs from a
third party servicer. The Company invested in portfolios with a face value of
$6.0 million at a cost of $2.5 million during the fiscal year ended September
30, 2012 as compared to portfolio investments with a face value of $19.5
million at a cost of approximately $7.5 million during the fiscal year ended
September 30, 2011. In addition, the Company had a net invested balance of
$18.6 million in personal injury claims on September 30, 2012.

General and administrative expenses were $23,640,000 for the fiscal year ended
September 30, 2012 as compared to $21,807,000 for the fiscal year ended
September 30, 2011. General and administrative expenses were higher due
primarily to the expenses related to inclusion of the personal injury unit
Pegasus Funding, LLC during the fiscal year 2012.

Interest expense for the fiscal year ended September 30, 2012 was $2,539,000
as compared to $3,016,000 for fiscal year 2011, a 16% reduction, as the
Company continues to pay down the non-recourse loan due to Bank of Montreal
("BMO"), which finances the Great Seneca portfolio. The related loan balance
was $61.5 million at September 30, 2012 as compared to $71.6 million at
September 30, 2011.

Impairment charges of $1,383,000 were recorded during fiscal year 2012 as
compared to $721,000 of impairment charges recorded during fiscal year 2011.

Fourth Quarter Fiscal Year 2012

The Company reported net income $1,552,000, or $0.12 per diluted share, for
the fourth quarter of fiscal year 2012, as compared to net income of
$1,656,000, or $0.11 per share, for the same period in fiscal year 2011. The
Company reported total revenues of $11,022,000 for the fourth quarter of
fiscal year 2012, an increase of $1,224,000, 12.5% over the $9,798,000
reported for the fourth quarter of fiscal year 2011. The results of the fourth
quarter of fiscal year 2011 included a one-time charge against revenues of
$1.3 million for invoicing of previously unbilled collection costs from a
third party servicer. The Company invested $6.4 million in personal injury
claims during the fourth quarter of fiscal year 2012.

Net cash collections of receivables acquired for liquidation, including net
cash collections represented by account sales, were $15,861,000 for the fourth
quarter of fiscal year 2012, as compared to $16,466,000 for the fourth quarter
of fiscal year 2011, down 3.7% from the prior year. Net collections on the
Great Seneca portfolio were $3.1 million in the fourth quarter of fiscal year
2012, an improvement over $2.6 million in the same prior year period.

Income from fully amortized portfolios (zero basis revenue) was $9.0 million
for the fourth quarter ended September 30, 2012, compared to $7.4 for the
comparable period in 2011. Included in zero basis revenue in the fourth
quarter of fiscal year 2011 was the previously mentioned one time charge of
$1.3 million.

General and administrative expenses for the fourth quarter of fiscal year 2012
were $7,148,000 as compared to $5,704,000 in the fourth quarter of fiscal year
2011, an increase of 25%. Expenses were higher in the fourth quarter of fiscal
year 2012 as compared to fiscal year 2011 primarily due to the inclusion of
Pegasus Funding, LLC, the personal injury unit.

An impairment charge of $650,000 was recorded in the fourth quarter of fiscal
year 2012 as compared to $672,000 in the fourth quarter of fiscal year 2011.

Interest expense for the fourth quarter 2012 was $600,000, as compared to
$687,000 for the comparable period in 2011, as the Company continues to pay
down the non-recourse loan due BMO. In addition, the Company has benefited
from a lower average interest rate during the fiscal year 2012.

Gary Stern, Chairman, President and CEO of the Company commented, "We are
pleased by the results of fiscal year and fourth quarter of 2012, with
continued strong liquidity and a solid balance sheet. Total revenues increased
over 12% in the fourth quarter of fiscal year 2012 as compared to the same
period of the prior year. Although the prior year fourth quarter results
included a one-time charge of $1.3 million, zero basis income still did
improve in the fourth quarter over the prior year. The performance in the core
business in the fourth quarter improved as zero basis revenue increased $2.1
million to $36.4 million from $34.3 million. In addition, investment results
and contributions from the personal injury unit, Pegasus Funding, LLC also
contributed to the improvement in total revenues in the fourth quarter of
fiscal year 2012." Mr. Stern continued, "At September 30, 2012 our cash and
cash equivalents and investments totaled $106.3 million as compared to $106.9
million at September 30, 2011. During the fiscal year 2012 we invested over
$20 million in personal injury claims and repurchased over $16 million of Asta
Funding, Inc. shares. As of today the total cash and cash equivalents and
investments is over $107 million. Our strong balance sheet puts us in an
excellent position for funding our investment opportunities without the
immediate need for external financing. We are not abandoning our roots as we
continue to review all of our investment options in the distressed receivables
market; however, in this challenging pricing and collection environment we are
continuing to explore other financing markets that we can effectively service
and possesses the potential to provide attractive returns. In addition, I am
announcing that the Board of Directors of Asta Funding, Inc. has approved the
payment of the 2013 annual dividend totaling $0.08 per share, payable to
shareholders of record on December 24, 2012 and payable on December 31, 2012.
The special dividend reflects the confidence of the Board of Directors in the
strong cash position and the Company's solid balance sheet. The management
team and Board of Directors would like to thank the shareholders for their
continued support."

A conference call to discuss the results of the fiscal year 2012 and the
fourth quarter of fiscal year 2012 will be held on Thursday, December 13, 2012
at 4:00 PM, EST.

Toll-free dial-in number (U.S. and Canada):
(800) 668-4132
 
International dial-in number:
(224) 357-2196
 
Conference ID
80372660
 
Phone Replay: 
Toll-Free #: (800) 585-8367 
International Toll #: (404) 537-3406 
Conference ID # 80372660
Recording will be available from: 12/13/2012 7:00 PM EST to 12/20/2012 11:59
PM EST

Based in Englewood Cliffs, NJ, Asta Funding, Inc., is a leading consumer
receivable asset management company that specializes in the purchase,
management and liquidation of performing and non-performing consumer
receivables. For additional information, please visit our website at
http://www.astafunding.com.

The Asta Funding, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=8464

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
objective of management for future operations, are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. 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, 2011 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.

                                                     - Financial Tables Follow

 
 
Asta Funding, Inc.
 Consolidated Statements of Operations 
Unaudited
                                                                    
                             Year Ended                Three Months Ended
                             September 30,             September 30,
                             2012         2011         2012        2011
Revenues:                                                           
Finance income, net          $ 40,599,000 $ 46,610,000 $ 9,838,000 $ 9,544,000
                                                                    
Other income                 3,903,000    557,000      1,184,000   254,000
                                                                    
                             44,502,000   43,167,000   11,022,000  9,798,000
                                                                    
General and administrative   23,640,000   21,807,000   7,148,000   5,704,000
expenses
                                                                    
Interest expense             2,539,000    3,016,000    600,000     687,000
                                                                    
Impairments of consumer
receivables acquired for     1,383,000    721,000      650,000     672,000
liquidation
                                                                    
                             27,562,000   25,544,000   8,398,000   7,063,000
                                                                    
Income before income taxes   16,940,000   17,623,000   2,624,000   2,735,000
                                                                    
Income tax expense           6,872,000    7,102,000    1,107,000   1,079,000
                                                                    
                                                                    
Net income                   10,068,000    10,521,000  1,517,000   1,656,000
Less: net income (loss)
attributable to              31,000       --           (35,000)    --
non-controlling interest
Net income attributable to   $ 10,037,000 $ 10,521,000 $ 1,552,000 $ 1,656,000
Asta Funding, Inc.
                                                                    
Basic net income per share   $ 0.71       $ 0.72       $ 0.12      $ 0.11
                                                                    
Diluted net income per share $ 0.70       $ 0.71       $ 0.12      $ 0.11
                                                                    
Weighted average shares                                             
outstanding:
Basic                        14,136,405   14,626,973   13,007,788  14,633,409
Diluted                      14,380,136   14,827,608   13,251,205  14,881,599

 
 
ASTA FUNDING, INC. AND SUBSIDIARIES
 
Consolidated Balance Sheets
Unaudited
                                                                  
                                                   September 30,
                                                   2012          2011
ASSETS                                                            
Cash and cash equivalents                          $ 4,953,000   $ 84,347,000
Investments:                                                      
Available-for-sale                                 58,712,000    13,515,000
Certificates of deposit                            42,682,000    9,060,000
Restricted cash                                    1,088,000     1,031,000
Consumer receivables acquired for liquidation (at  86,887,000    115,195,000
net realizable value)
Other investments                                  18,596,000    --
Due from third party collection agencies and       2,042,000     2,084,000
attorneys
Prepaid and income taxes receivable                2,057,000     3,369,000
Furniture and equipment (net of accumulated
depreciation of $3,696,000 in 2012 and $3,316,000  821,000       563,000
in 2011)
Deferred income taxes                              10,410,000    14,358,000
Other assets                                       4,916,000     4,529,000
Total assets                                       $ 233,164,000 $ 248,051,000
                                                                  
                                                                  
LIABILITIES AND STOCKHOLDERS' EQUITY                              
Liabilities                                                       
Non recourse debt                                  $ 61,463,000  $ 71,604,000
Other liabilities                                  2,920,000     3,167,000
Dividends payable                                  260,000       293,000
Income taxes payable                               --            31,000
Total liabilities                                  64,643,000    75,095,000
Commitments and contingencies                                     
STOCKHOLDERS' EQUITY                                              
Preferred stock, $.01 par value; authorized        --            --
5,000,000; Issued — none
Common stock, $.01 par value, authorized
30,000,000 shares, issued and outstanding          148,000       146,000
14,778,956 shares in 2012 and 14,639,456 shares in
2011 
Additional paid-in capital                         77,024,000    74,793,000
Retained earnings                                  107,303,000   98,377,000
Accumulated other comprehensive income (loss), net 241,000       (290,000)
of income taxes 
Treasury stock (at cost), 1,772,038 shares in 2012 (16,226,000)  (70,000)
and 8,900 shares in 2011
Total stockholders' equity                         168,490,000   172,956,000
Non-controlling interest                           31,000        --
Total equity                                       168,521,000   172,956,000
Total liabilities and stockholders' equity         $ 233,164,000 $ 248,051,000

CONTACT: Robert J. Michel, CFO
         Asta Funding, Inc.
         (201) 567-5648

Asta Funding, Inc. Logo
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