-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AHQlh/xUtfSXdkhsyUiFYaNnypiOtVjMFgsOaU6g+stuVXnJFK7JbTXUllQzMdRc O/dspQiEXDjVI0rZBvFfiQ== 0001037603-99-000013.txt : 19990506 0001037603-99-000013.hdr.sgml : 19990506 ACCESSION NUMBER: 0001037603-99-000013 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990505 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEWCOURT CREDIT GROUP INC CENTRAL INDEX KEY: 0001037603 STANDARD INDUSTRIAL CLASSIFICATION: LOAN BROKERS [6163] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: SEC FILE NUMBER: 001-14604 FILM NUMBER: 99611054 BUSINESS ADDRESS: STREET 1: STE 3500 BCE PLACE STREET 2: 181 BAY ST P.O.BOX 827 CITY: TORONTO ONTARIO STATE: A6 BUSINESS PHONE: 4165942400 MAIL ADDRESS: STREET 1: 181 BAY STREET SUITE 3500 STREET 2: PO BOX 827 CITY: TORONTO ONTARIO 6-K 1 FIRST QUARTER PRESS RELEASE FORM 6-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Report of a Foreign Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 For the month(s) of: March 31, 1999 NEWCOURT CREDIT GROUP INC. Newcourt Centre, 207 Queens Quay West Suite 700 Toronto, Ontario Canada, M5J 1A7 [Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.] Form 20-F / / Form 40-F /X/ [Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.] Yes / / No /X/ [If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b)] 82- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: May 5, 1999 NEWCOURT CREDIT GROUP INC. By: John P. Stevenson Corporate Secretary News Release For Immediate Release Trading Symbol: NCT Media Contact: Rick Perkins (416) 507-5437 Exchange Listing: Toronto Investor Contact: Geoff Ichii Montreal (416) 507-6151 New York Newcourt reports first quarter results with sharply reduced use of securitization funding Toronto, May 5, 1999 - Newcourt Credit Group today reported net income of US$36.1 million (Cdn$54.8 million) for the three months ended March 31, 1999, compared to US$27.3 million (Cdn$42.4 million) reported for the same period last year. Earnings per share on a fully diluted basis were US$0.24 (Cdn$0.36) for the year compared to US$0.21 (Cdn$0.32) during the same period last year. These results are below consensus analyst expectations due in part to lower than planned use of securitization funding during the quarter. During the quarter the Company reduced its use of securitization funding by approximately US$1.1 billion from originally planned levels. As a result, securitization fee income, which normally arises at the time loans are booked and sold through the Company's securitization vehicles, is being deferred to future reporting periods to be earned over time as net finance income. Assets permanently funded on the balance sheet reduce net income by adding to the provisions normally taken for owned versus managed assets. During the period the Company also recorded a one-time pre-tax gain of US$56.6 million (Cdn$85.9 million) arising from its unwinding of certain currency hedges no longer required following the change in the Company's reporting currency to US dollars from Canadian dollars. "Despite reporting lower than expected first quarter earnings, our business fundamentals are strong," noted Steven K. Hudson, Newcourt's CEO. "We achieved record volumes in each of our two businesses, sales at our top vendor customers ran ahead of plan, we exceeded our targets to lower operating expenses, and our business backlogs increased. As was stated at the time of the announcement of our planned merger with The CIT Group, the intent is to reduce the combined company's reliance on securitization funding to less than 15% by year 2000. Newcourt took this opportunity to accelerate the shift in our funding mix in favour of on-balance sheet funding versus securitization." Newcourt originated new asset-based financings of US$4.9 billion (Cdn$7.4 billion) during the first three months of 1999, an increase of 68% from US$2.9 billion (Cdn$4.5 billion) reported during the same period last year. Of the US$4.90 billion in new financings, US$3.9 billion (Cdn$5.8 billion) were generated from Newcourt Financial's activities in the commercial finance market. The remaining volume of US$1.0 billion (Cdn$1.6 billion) was originated by Newcourt Capital in the corporate finance market. As a result of continued growth in the Company's loan originations and increasing use of on-balance sheet funding, tangible leverage increased to 6.6:1 as at March 31, 1999 compared to the 5.9:1 as at December 31, 1998. Total asset finance income for the three months ending March 31, 1999 rose 13% to US$236.7 million (Cdn$339.5 million) from US$209.2 million (Cdn$324.8 million) during the same period last year. Operating costs for the period, excluding depreciation and amortization, amounted to US$158.4 million (Cdn$240.5 million) compared to US$144.7 million ($224.7 million) for the same period last year. Expressed as a percentage of owned and managed loans, operating expenses on an annualized basis, excluding depreciation and amortization, declined from 2.7% at December 31, 1998 to 2.6% as at March 31, 1999. At a meeting of the Board of Directors held May 5, 1999, a quarterly dividend of Cdn$0.06 per share was approved for payment on May 28, 1999 to shareholders of record as of May 18, 1999. On March 8, 1999, Newcourt announced that it had entered an agreement with The CIT Group which would see the Company acquired by CIT in a share-for- share exchange. Subject to the achievement of a number of conditions as well as regulatory and shareholder approval, the transaction is scheduled to close in the third quarter of 1999. "Management is confident that the various conditions required to close the CIT/Newcourt merger will be met in accordance with the agreement," added Hudson. Newcourt Credit Group is one of the world's leading sources of asset-based financing serving the corporate, commercial and institutional markets with owned and managed assets of US$25.1 billion (Cdn$38.0 billion) and a global capability in 26 countries. This report may contain forward looking statements about the operations, objectives and strategies of Newcourt. These statements are subject to risks and uncertainties. Actual results may differ materially due to a variety of factors including competition, technological change, issues relating to Year 2000 readiness, the global capital markets and general economic conditions in the U.S., Canada, or internationally. These and other factors should be considered carefully and readers should not place undue reliance on Newcourt's forward looking statements.
Newcourt Credit Group Inc. Summary of Quarterly Financial Statistics for the period ended March 31, 1999, (all amounts in United States dollars unless otherwise stated) I. Basic Earnings per Share (common and special) Average shares outstanding during the period Number of Common and Special Shares as at January 1, 1999 148,312,634 # shares # days o/s Shares issued during the quarter ended March 31, 1999 11,475 53 / 90 6,766 Weighted average shares outstanding, March 31, 1999 148,319,400 Net income for the year to date $36,057 II. Comparative Earnings Per Share Summary Three Months Ended March 31 1999 1998 Basic $0.24 $0.21 Fully Diluted 0.24 0.21 Cash Basis 0.32 0.31 Dividends per share (Canadian dollars) 0.06 0.04 III. Balance Sheet Highlights ($ millions) As at March 31 1999 1998 Owned and managed assets 25,144 20,538 Tangible Equity 1,773 1,455 Tangible Leverage 6.6:1 6.1:1 IV. Income Statement Highlights (US$000) Three Months Ended March 31 1999 1998 Operating income before taxes 60,396 46,062 New originations 4,899,397 2,922,538 Originations U.S. & Canada 87.0% U.K. / Europe 9.7% Asia Pacific 2.6% Latin America 0.7% 100%
V. Margin Analysis Summary (US$000) (i) Securitization Three Months Ended March 31 1999 1998 Securitization Fees 32,437 48,985 Assets Securitized 1,040,174 1,056,135 Securitization Margin 3.12% 4.64% (ii) Syndication Syndication Fees 16,820 6,524 Assets Syndicated 1,038,952 553,500 Syndication Margin 1.62% 1.18% (iii) Net Finance Income Finance assets held for investment 8,900,429 7,420,011 Equipment under operating lease 2,265,632 1,852,035 Finance assets held for sale 2,061,763 1,029,513 Total owned assets 13,227,824 10,301,559 Average total owned assets 12,777,906 10,065,100 Net Finance and Rental Income 94,676 122,494 Net Finance Income Margin 2.96% 4.87% Interest Expense 199,944 140,935 OPEX / Owned and Managed Assets 2.6% 2.8% All figures expressed in United States dollars unless otherwise stated 1998 financial figures have been translated from Canadian to US using a rate of 0.6443 Includes a pre-tax gain of $56,582 attributed to unwind of net investments hedges
Newcourt Credit Group Inc. CONSOLIDATED BALANCE SHEETS (Unaudited) [in thousands of United States dollars] March 31, December 31, 1999 1998 $ $ ASSETS Cash 440,355 998,807 Finance assets held for investment 8,900,429 8,611,705 Equipment under operating lease 2,265,632 2,173,514 Finance assets held for sale 2,061,763 1,542,769 Investment in affiliated companies 256,142 194,860 Accounts receivable, prepaids and other 402,434 310,948 Property and equipment, net 100,244 93,874 Goodwill 1,275,188 1,280,036 Future income tax asset 180,965 146,444 Total Assets 15,883,152 15,352,957 LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Accounts payable and accrued liabilities 686,256 727,468 Debt 12,148,897 11,607,184 Total Liabilities 12,835,153 12,334,652 Shareholders' Equity Share capital 2,792,137 2,792,861 Retained earnings 255,862 225,444 Total Shareholders' Equity 3,047,999 3,018,305 Total Liabilities and Shareholders' Equity 15,883,152 15,352,957
Newcourt Credit Group Inc. CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (Unaudited) [in thousands of United States dollars, except for per share amounts] Three Months Ended March 31, March 31, 1999 1998 $ $ Asset finance income Net finance and rental income 94,676 122,494 Gain on sale of finance assets 49,257 55,509 Management fees and other income 92,786 31,243 Total asset finance income 236,719 209,246 Salaries and wages 88,930 75,243 Operating and administrative 69,463 69,504 Depreciation and goodwill amortization 17,930 18,437 Operating income before income taxes 60,396 46,062 Provision for income taxes 24,339 18,751 Net income for the period 36,057 27,311 Retained earnings, beginning of period 225,444 81,240 Dividends paid on common shares (5,639) (3,596) Retained earnings, end of period 255,862 104,955 Earnings per common share: Basic $0.24 $0.21 Fully diluted $0.24 $0.21
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