Delaware | 001-36170 | 46-3037859 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
201 King of Prussia Road, Suite 501, Radnor, Pennsylvania | 19087-5148 | |||
(Address of principal executive offices) | (Zip Code) |
Exhibit No. | Description | |
99.1 | Press Release, dated August 5, 2015, issued by The J.G. Wentworth Company |
THE J.G. WENTWORTH COMPANY | |||
By: | /s/ John R. Schwab | ||
Name: | John R. Schwab | ||
Title: | Executive Vice President & Chief Financial Officer | ||
Dated: August 6, 2015 |
Exhibit No. | Description | |
99.1 | Press Release, dated August 5, 2015, issued by The J.G. Wentworth Company |
• | Revenues were $61.4 million, a decrease of 50.3% as compared to revenues of $123.5 million in the second quarter of 2014, due primarily to: (i) an increase in our cost of funds during Q2 2015 as compared to Q2 2014 and the resulting impact on unrealized gains on VIE and other finance receivables, long term debt and derivatives primarily from our $4.4 billion of previously securitized finance receivables, and (ii) to a lesser extent, the impact of a decrease in purchase yield on fundings and in Total Receivables Balance ("TRB") purchases in Q2 2015 as compared to Q2 2014. |
• | Net income decreased to a loss of $26.6 million, as compared to net income of $21.7 million in the second quarter of 2014, due primarily to: (i) an increase in our cost of funds during Q2 2015 as compared to Q2 2014 and the resulting impact on unrealized gains on VIE and other finance receivables, long term debt and derivatives primarily from our $4.4 billion of previously securitized finance receivables, and (ii) to a lesser extent, the impact of a decrease in purchase yield on fundings and in TRB purchases in Q2 2015 as compared to Q2 2014. |
• | TRB purchases were $262.9 million, as compared to $287.7 million in the second quarter of 2014 and $260.8 million in the first quarter of 2015. |
• | Adjusted Net Income*, or ANI, decreased to a loss of $2.3 million, as compared to income of $17.2 million in the second quarter of 2014 and $8.2 million in the first quarter of 2015. |
• | The leading driver in the decrease in ANI was an increase in the cost of funds. To a lesser extent, the size and duration mix on fundings and decrease in purchase yield also contributed to the decrease in ANI. The second quarter 2014 TRB purchases and ANI reflect results higher than Company averages over the more recent quarters. |
• | Spread Revenue* (Adjusted unrealized gains on VIE and other finance receivables, long term debt and derivatives, net of the gain (loss) on swap terminations) decreased to $38.0 million, as compared to $58.0 million in the second quarter of 2014 and $50.5 million in the first quarter of 2015, primarily as a result of increasing cost of funds, and to a lesser extent, the size and duration mix on fundings and decrease in purchase yield. |
• | Successfully closed the WestStar Mortgage, Inc. ("WestStar") acquisition on July 31, 2015 for a purchase price of $66.7 million. For the second quarter 2015, WestStar originated approximately $630 million in new loans and reported $6.5 million in net income which represented a year over year increase of 72% and 41%, respectively. For the first half of 2015 WestStar originated approximately $1.2 billion in new loans resulting in $11.1 million of net income.** |
• | Launched new transactional website www.jgwentworth.com to enable full marketplace platform of multi-products for customers including structured settlements, personal and business lending, prepaid cards and mortgage loans. |
• | Completed the 2015-2 securitization, which consisted of $158,476,000 Fixed Asset Backed Notes. The issue comprised of two classes of placed notes: $142,126,000 Class A Fixed Rate Asset Backed Notes that will pay 3.87%, and $16,350,000 Class B Fixed Rate Asset Backed Notes that will pay 4.83%. The notes are rated AAA (DBRS) and Aaa (Moody’s); and BBB (DBRS) and Baa2 (Moody’s), respectively. |
June 30, 2015 | December 31, 2014 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 56,091 | $ | 41,648 | |||
Restricted cash and investments | 130,604 | 198,206 | |||||
VIE finance receivables, at fair market value | 4,402,887 | 4,422,033 | |||||
Other finance receivables, at fair market value | 66,753 | 101,802 | |||||
VIE finance receivables, net of allowances for losses of $8,494 and $7,674, respectively | 112,152 | 113,489 | |||||
Other finance receivables, net of allowances for losses of $2,474 and $2,454, respectively | 13,541 | 17,803 | |||||
Other receivables, net of allowances for losses of $273 and $204, respectively | 13,979 | 14,165 | |||||
Fixed assets, net of accumulated depreciation of $7,076 and $5,976, respectively | 4,375 | 3,758 | |||||
Intangible assets, net of accumulated amortization of $21,168 and $20,273, respectively | 44,541 | 45,436 | |||||
Goodwill | 84,993 | 84,993 | |||||
Marketable securities | 96,649 | 103,419 | |||||
Deferred tax assets, net | — | 2,170 | |||||
Other assets | 30,235 | 33,787 | |||||
Total Assets | $ | 5,056,800 | $ | 5,182,709 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Accounts payable | $ | 8,952 | $ | 5,301 | |||
Accrued expenses | 18,367 | 13,955 | |||||
Accrued interest | 19,815 | 17,416 | |||||
VIE derivative liabilities, at fair market value | 68,251 | 75,706 | |||||
VIE borrowings under revolving credit facilities and other similar borrowings | 41,672 | 19,339 | |||||
VIE long-term debt | 178,619 | 181,558 | |||||
VIE long-term debt issued by securitization and permanent financing trusts, at fair market value | 3,938,740 | 4,031,864 | |||||
Term loan payable | 438,682 | 437,183 | |||||
Other liabilities | 7,717 | 6,677 | |||||
Deferred tax liabilities, net | 28,541 | 36,656 | |||||
Installment obligations payable | 96,649 | 103,419 | |||||
Total Liabilities | 4,846,005 | 4,929,074 | |||||
Class A common stock, par value $0.00001 per share; 500,000,000 shares authorized, 15,928,585 and 14,103,501 issued and outstanding as of June 30, 2015, respectively, 15,021,147 and 14,420,392 issued and outstanding as of December 31, 2014, respectively. | — | — | |||||
Class B common stock, par value $0.00001 per share; 500,000,000 shares authorized, 9,042,349 issued and outstanding as of June 30, 2015, 9,963,750 issued and outstanding as of December 31, 2014, respectively. | — | — | |||||
Class C common stock, par value $0.00001 per share; 500,000,000 shares authorized, 0 issued and outstanding as of June 30, 2015 and December 31, 2014, respectively. | — | — | |||||
Additional paid-in-capital | 104,109 | 95,453 | |||||
Retained earnings | 11,993 | 25,634 | |||||
116,102 | 121,087 | ||||||
Less: treasury stock at cost, 1,825,084 and 600,755 shares as of June 30, 2015 and December 31, 2014, respectively. | (8,453 | ) | (2,443 | ) | |||
Total stockholders’ equity, The J.G. Wentworth Company | 107,649 | 118,644 | |||||
Non-controlling interests | 103,146 | 134,991 | |||||
Total Stockholders’ Equity | 210,795 | 253,635 | |||||
Total Liabilities and Stockholders’ Equity | $ | 5,056,800 | $ | 5,182,709 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
REVENUES | |||||||||||||||
Interest income | $ | 45,568 | $ | 46,638 | $ | 89,960 | $ | 94,460 | |||||||
Unrealized gains on VIE and other finance receivables, long-term debt and derivatives | 15,581 | 70,317 | 55,002 | 157,628 | |||||||||||
Loss on swap terminations, net | — | — | (275 | ) | (574 | ) | |||||||||
Servicing, broker, and other | 1,130 | 968 | 1,999 | 2,110 | |||||||||||
Realized and unrealized (losses) gains on marketable securities, net | (916 | ) | 3,467 | 914 | 4,356 | ||||||||||
Realized gain on notes receivable, at fair value | — | 2,098 | — | 2,098 | |||||||||||
Gain on extinguishment of debt | — | — | 593 | — | |||||||||||
Total Revenues | $ | 61,363 | $ | 123,488 | $ | 148,193 | $ | 260,078 | |||||||
EXPENSES | |||||||||||||||
Advertising | $ | 16,942 | $ | 16,432 | $ | 32,782 | $ | 33,925 | |||||||
Interest expense | 50,068 | 50,700 | 98,903 | 101,930 | |||||||||||
Compensation and benefits | 9,418 | 10,483 | 22,216 | 19,769 | |||||||||||
General and administrative | 4,733 | 4,613 | 9,372 | 9,083 | |||||||||||
Professional and consulting | 4,861 | 5,518 | 9,299 | 8,962 | |||||||||||
Debt issuance | 123 | 19 | 2,872 | 3,020 | |||||||||||
Securitization debt maintenance | 1,494 | 1,564 | 2,990 | 3,121 | |||||||||||
Provision for losses on finance receivables | 1,618 | 1,127 | 2,957 | 2,218 | |||||||||||
Depreciation and amortization | 1,004 | 1,121 | 1,995 | 2,202 | |||||||||||
Installment obligations (income) expense, net | (249 | ) | 4,122 | 2,071 | 5,614 | ||||||||||
Total Expenses | $ | 90,012 | $ | 95,699 | $ | 185,457 | $ | 189,844 | |||||||
(Loss) income before income taxes | (28,649 | ) | 27,789 | (37,264 | ) | 70,234 | |||||||||
(Benefit) provision for income taxes | (2,016 | ) | 6,081 | (5,171 | ) | 13,993 | |||||||||
Net (Loss) Income | $ | (26,633 | ) | $ | 21,708 | $ | (32,093 | ) | $ | 56,241 | |||||
Less net (loss) income attributable to non-controlling interests | (14,337 | ) | 15,440 | (18,452 | ) | 40,951 | |||||||||
Net (loss) income attributable to The J.G. Wentworth Company | $ | (12,296 | ) | $ | 6,268 | $ | (13,641 | ) | $ | 15,290 | |||||
Weighted average shares of Class A common stock outstanding: | |||||||||||||||
Basic | 14,113,990 | 12,559,957 | 14,192,480 | 12,104,172 | |||||||||||
Diluted | 14,113,990 | 12,562,042 | 14,192,480 | 12,105,548 | |||||||||||
Net (loss) income per share attributable to stockholders of Class A common stock of The J.G. Wentworth Company | |||||||||||||||
Basic | $ | (0.87 | ) | $ | 0.50 | $ | (0.96 | ) | $ | 1.26 | |||||
Diluted | $ | (0.87 | ) | $ | 0.50 | $ | (0.96 | ) | $ | 1.26 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net (Loss) Income | $ | (26,633 | ) | $ | 21,708 | $ | (32,093 | ) | $ | 56,241 | |||||
Adjustments to reflect deconsolidation of securitizations: | |||||||||||||||
Elimination of unrealized gain/loss on finance receivables, long-term debt and derivatives from post securitization due to changes in interest rates | 23,062 | (12,366 | ) | 32,191 | (47,257 | ) | |||||||||
Elimination of interest income from securitized finance receivables | (41,267 | ) | (42,041 | ) | (81,236 | ) | (85,344 | ) | |||||||
Interest income on retained interests in finance receivables | 5,267 | 5,001 | 10,433 | 9,970 | |||||||||||
Servicing income on securitized finance receivables | 1,316 | 1,242 | 2,631 | 2,500 | |||||||||||
Elimination of interest expense on long-term debt related to securitization and permanent financing trusts | 35,679 | 36,213 | 69,887 | 73,498 | |||||||||||
Professional fees relating to securitizations | 1,494 | 1,564 | 2,990 | 3,121 | |||||||||||
Other adjustments: | |||||||||||||||
Share based compensation | 706 | 798 | 1,116 | 1,300 | |||||||||||
Income tax (benefit) provision | (2,016 | ) | 6,081 | (5,171 | ) | 13,993 | |||||||||
Impact of prefunding on unsecuritized finance receivables | (654 | ) | — | 1,618 | — | ||||||||||
Severance and M&A expenses | 730 | 376 | 3,564 | 675 | |||||||||||
Other nonrecurring items | — | (1,401 | ) | — | (1,401 | ) | |||||||||
Adjusted Net (Loss) Income | $ | (2,316 | ) | $ | 17,175 | $ | 5,930 | $ | 27,296 | ||||||
Other Data: | |||||||||||||||
Securitized Product Total Receivables Balance (TRB) Purchases (1) | $ | 231,654 | $ | 252,544 | $ | 466,626 | $ | 476,051 | |||||||
Life Contingent Purchases | 26,807 | 28,185 | 46,306 | 58,012 | |||||||||||
Presettlement Fundings | 4,404 | 6,977 | 10,763 | 14,224 | |||||||||||
Total TRB Purchases | $ | 262,865 | $ | 287,706 | $ | 523,695 | $ | 548,287 | |||||||
Adjusted Net (Loss) Income | $ | (2,316 | ) | $ | 17,175 | $ | 5,930 | $ | 27,296 | ||||||
Adjusted Net (Loss) Income TRB Margin (2) | (0.88 | )% | 5.97 | % | 1.13 | % | 4.98 | % | |||||||
Company retained interests in finance receivables at fair market value | $ | 299,412 | $ | 294,637 |
Q2 2015 GAAP Results | Adjustments to reflect deconsolidation of securitizations | Impact of Prefundings on Unsecuritized Finance Receivables | Interest Income on Retained Interests | Share Based Compensation | Income Tax | Severance and M&A Expenses | Reclassification Associated with Installment Obligation Payable | Q2 2015 Adjusted Results | |||||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||||||||
Interest income | $ | 45,568 | $ | (41,267 | ) | $ | — | $ | 5,267 | $ | — | $ | — | $ | — | $ | (667 | ) | $ | 8,901 | |||||||||||||||
Unrealized gains on VIE and other finance receivables, long-term debt and derivatives | 15,581 | 23,062 | (654 | ) | — | — | — | — | — | 37,989 | |||||||||||||||||||||||||
Servicing, broker, and other | 1,130 | 1,316 | — | — | — | — | — | — | 2,446 | ||||||||||||||||||||||||||
Realized and unrealized (losses) on marketable securities, net | (916 | ) | — | — | — | — | — | — | 916 | — | |||||||||||||||||||||||||
Total Revenues | $ | 61,363 | $ | (16,889 | ) | $ | (654 | ) | $ | 5,267 | $ | — | $ | — | $ | — | $ | 249 | $ | 49,336 | |||||||||||||||
EXPENSES | |||||||||||||||||||||||||||||||||||
Advertising | $ | 16,942 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 16,942 | |||||||||||||||||
Interest expense | 50,068 | (35,679 | ) | 14,389 | |||||||||||||||||||||||||||||||
Compensation and benefits | 9,418 | — | — | — | (706 | ) | — | (35 | ) | — | 8,677 | ||||||||||||||||||||||||
General and administrative | 4,733 | — | — | — | — | — | (10 | ) | — | 4,723 | |||||||||||||||||||||||||
Professional and consulting | 4,861 | — | — | — | — | — | (685 | ) | — | 4,176 | |||||||||||||||||||||||||
Debt issuance | 123 | — | — | — | — | — | — | — | 123 | ||||||||||||||||||||||||||
Securitization debt maintenance | 1,494 | (1,494 | ) | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Provision for losses on finance receivables | 1,618 | — | — | — | — | — | — | — | 1,618 | ||||||||||||||||||||||||||
Depreciation and amortization | 1,004 | — | — | — | — | — | — | — | 1,004 | ||||||||||||||||||||||||||
Installment obligations income, net | (249 | ) | — | — | — | — | — | — | 249 | — | |||||||||||||||||||||||||
Total Expenses | $ | 90,012 | $ | (37,173 | ) | $ | — | $ | — | $ | (706 | ) | $ | — | $ | (730 | ) | $ | 249 | $ | 51,652 | ||||||||||||||
Loss before income taxes | $ | (28,649 | ) | $ | 20,284 | $ | (654 | ) | $ | 5,267 | $ | 706 | $ | — | $ | 730 | $ | — | $ | (2,316 | ) | ||||||||||||||
Benefit for income taxes | (2,016 | ) | — | — | — | — | 2,016 | — | — | — | |||||||||||||||||||||||||
Net Loss | $ | (26,633 | ) | $ | 20,284 | $ | (654 | ) | $ | 5,267 | $ | 706 | $ | (2,016 | ) | $ | 730 | $ | — | $ | (2,316 | ) |
Q2 2014 GAAP Results | Adjustments to reflect deconsolidation of securitizations | Interest Income on Retained Interests | Share Based Compensation | Income Tax | Severance and M&A Expenses | Reclassification Associated with Installment Obligation Payable | Other Nonrecurring Items | Q2 2014 Adjusted Results | |||||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||||||||
Interest income | $ | 46,638 | $ | (42,041 | ) | $ | 5,001 | $ | — | $ | — | $ | — | $ | (655 | ) | $ | 6 | $ | 8,949 | |||||||||||||||
Unrealized gains on VIE and other finance receivables, long-term debt and derivatives | 70,317 | (12,366 | ) | — | — | — | — | — | — | 57,951 | |||||||||||||||||||||||||
Servicing, broker, and other | 968 | 1,242 | — | — | — | — | — | — | 2,210 | ||||||||||||||||||||||||||
Realized and unrealized gains on marketable securities, net | 3,467 | — | — | — | — | — | (3,467 | ) | — | — | |||||||||||||||||||||||||
Realized gain on notes receivable | 2,098 | — | — | — | — | — | — | (2,098 | ) | — | |||||||||||||||||||||||||
Total Revenues | $ | 123,488 | $ | (53,165 | ) | $ | 5,001 | $ | — | $ | — | $ | — | $ | (4,122 | ) | $ | (2,092 | ) | $ | 69,110 | ||||||||||||||
EXPENSES | |||||||||||||||||||||||||||||||||||
Advertising | $ | 16,432 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 16,432 | |||||||||||||||||
Interest expense | 50,700 | (36,213 | ) | — | — | — | — | — | — | 14,487 | |||||||||||||||||||||||||
Compensation and benefits | 10,483 | — | — | (798 | ) | — | (86 | ) | — | — | 9,599 | ||||||||||||||||||||||||
General and administrative | 4,613 | — | — | — | — | 86 | — | — | 4,699 | ||||||||||||||||||||||||||
Professional and consulting | 5,518 | — | — | — | — | (376 | ) | — | (691 | ) | 4,451 | ||||||||||||||||||||||||
Debt issuance | 19 | — | — | — | — | — | — | — | 19 | ||||||||||||||||||||||||||
Securitization debt maintenance | 1,564 | (1,564 | ) | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Provision for losses on finance receivables | 1,127 | — | — | — | — | — | — | — | 1,127 | ||||||||||||||||||||||||||
Depreciation and amortization | 1,121 | — | — | — | — | — | — | — | 1,121 | ||||||||||||||||||||||||||
Installment obligations expense, net | 4,122 | — | — | — | — | — | (4,122 | ) | — | — | |||||||||||||||||||||||||
Total Expenses | $ | 95,699 | $ | (37,777 | ) | $ | — | $ | (798 | ) | $ | — | $ | (376 | ) | $ | (4,122 | ) | $ | (691 | ) | $ | 51,935 | ||||||||||||
Income before income taxes | $ | 27,789 | $ | (15,388 | ) | $ | 5,001 | $ | 798 | $ | — | $ | 376 | $ | — | $ | (1,401 | ) | $ | 17,175 | |||||||||||||||
Provision for income taxes | 6,081 | — | — | — | (6,081 | ) | — | — | — | — | |||||||||||||||||||||||||
Net Income | $ | 21,708 | $ | (15,388 | ) | $ | 5,001 | $ | 798 | $ | 6,081 | $ | 376 | $ | — | $ | (1,401 | ) | $ | 17,175 |
YTD 2015 GAAP Results | Adjustments to reflect deconsolidation of securitizations | Impact of Prefundings on Unsecuritized Finance receivables | Interest Income on Retained Interests | Share Based Compensation | Income Tax | Severance and M&A Expenses | Reclassification Associated with Installment Obligation Payable | YTD 2015 Adjusted Results | |||||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||||||||
Interest income | $ | 89,960 | $ | (81,236 | ) | $ | — | $ | 10,433 | $ | — | $ | — | $ | — | $ | (1,157 | ) | $ | 18,000 | |||||||||||||||
Unrealized gains on VIE and other finance receivables, long-term debt and derivatives | 55,002 | 32,191 | 1,618 | — | — | — | — | — | 88,811 | ||||||||||||||||||||||||||
Loss on swap terminations, net | (275 | ) | — | — | — | — | — | — | — | (275 | ) | ||||||||||||||||||||||||
Servicing, broker, and other | 1,999 | 2,631 | — | — | — | — | — | — | 4,630 | ||||||||||||||||||||||||||
Realized and unrealized gains on marketable securities, net | 914 | — | — | — | — | — | — | (914 | ) | — | |||||||||||||||||||||||||
Gain on debt extinguishment | 593 | — | — | — | — | — | — | — | 593 | ||||||||||||||||||||||||||
Total Revenues | $ | 148,193 | $ | (46,414 | ) | $ | 1,618 | $ | 10,433 | $ | — | $ | — | $ | — | $ | (2,071 | ) | $ | 111,759 | |||||||||||||||
EXPENSES | |||||||||||||||||||||||||||||||||||
Advertising | $ | 32,782 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 32,782 | |||||||||||||||||
Interest expense | 98,903 | (69,887 | ) | — | — | — | — | — | — | 29,016 | |||||||||||||||||||||||||
Compensation and benefits | 22,216 | — | — | — | (1,116 | ) | — | (2,272 | ) | — | 18,828 | ||||||||||||||||||||||||
General and administrative | 9,372 | — | — | — | — | — | (13 | ) | — | 9,359 | |||||||||||||||||||||||||
Professional and consulting | 9,299 | — | — | — | — | — | (1,279 | ) | — | 8,020 | |||||||||||||||||||||||||
Debt issuance | 2,872 | — | — | — | — | — | — | — | 2,872 | ||||||||||||||||||||||||||
Securitization debt maintenance | 2,990 | (2,990 | ) | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Provision for losses on finance receivables | 2,957 | — | — | — | — | — | — | — | 2,957 | ||||||||||||||||||||||||||
Depreciation and amortization | 1,995 | — | — | — | — | — | — | — | 1,995 | ||||||||||||||||||||||||||
Installment obligations expense, net | 2,071 | — | — | — | — | — | — | (2,071 | ) | — | |||||||||||||||||||||||||
Total Expenses | $ | 185,457 | $ | (72,877 | ) | $ | — | $ | — | $ | (1,116 | ) | $ | — | $ | (3,564 | ) | $ | (2,071 | ) | $ | 105,829 | |||||||||||||
(Loss) income before income taxes | $ | (37,264 | ) | $ | 26,463 | $ | 1,618 | $ | 10,433 | $ | 1,116 | $ | — | $ | 3,564 | $ | — | $ | 5,930 | ||||||||||||||||
Benefit for income taxes | (5,171 | ) | — | — | — | — | 5,171 | — | — | — | |||||||||||||||||||||||||
Net (Loss) Income | $ | (32,093 | ) | $ | 26,463 | $ | 1,618 | $ | 10,433 | $ | 1,116 | $ | (5,171 | ) | $ | 3,564 | $ | — | $ | 5,930 |
YTD 2014 GAAP Results | Adjustments to reflect deconsolidation of securitizations | Interest Income on Retained Interests | Share Based Compensation | Income Tax | Severance and M&A Expenses | Reclassification Associated with Installment Obligation Payable | Other Nonrecurring Items | YTD 2014 Adjusted Results | |||||||||||||||||||||||||||
REVENUES | |||||||||||||||||||||||||||||||||||
Interest income | $ | 94,460 | $ | (85,344 | ) | $ | 9,970 | $ | — | $ | — | $ | — | $ | (1,258 | ) | $ | 6 | $ | 17,834 | |||||||||||||||
Unrealized gains on VIE and other finance receivables, long-term debt and derivatives | 157,628 | (47,257 | ) | — | — | — | — | — | — | 110,371 | |||||||||||||||||||||||||
Loss on swap terminations, net | (574 | ) | — | — | — | — | — | — | — | (574 | ) | ||||||||||||||||||||||||
Servicing, broker, and other | 2,110 | 2,500 | — | — | — | — | — | — | 4,610 | ||||||||||||||||||||||||||
Realized and unrealized gains on marketable securities, net | 4,356 | — | — | — | — | — | (4,356 | ) | — | — | |||||||||||||||||||||||||
Realized gain on notes receivable | 2,098 | — | — | — | — | — | — | (2,098 | ) | — | |||||||||||||||||||||||||
Total Revenues | $ | 260,078 | $ | (130,101 | ) | $ | 9,970 | $ | — | $ | — | $ | — | $ | (5,614 | ) | $ | (2,092 | ) | $ | 132,241 | ||||||||||||||
EXPENSES | |||||||||||||||||||||||||||||||||||
Advertising | $ | 33,925 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 33,925 | |||||||||||||||||
Interest expense | 101,930 | (73,498 | ) | — | — | — | — | — | — | 28,432 | |||||||||||||||||||||||||
Compensation and benefits | 19,769 | — | — | (1,300 | ) | — | (113 | ) | — | — | 18,356 | ||||||||||||||||||||||||
General and administrative | 9,083 | — | — | — | — | 86 | — | — | 9,169 | ||||||||||||||||||||||||||
Professional and consulting | 8,962 | — | — | — | — | (648 | ) | — | (691 | ) | 7,623 | ||||||||||||||||||||||||
Debt issuance | 3,020 | 3,020 | |||||||||||||||||||||||||||||||||
Securitization debt maintenance | 3,121 | (3,121 | ) | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Provision for losses on finance receivables | 2,218 | — | — | — | — | — | — | — | 2,218 | ||||||||||||||||||||||||||
Depreciation and amortization | 2,202 | — | — | — | — | — | — | — | 2,202 | ||||||||||||||||||||||||||
Installment obligations expense, net | 5,614 | — | — | — | — | — | (5,614 | ) | — | — | |||||||||||||||||||||||||
Total Expenses | $ | 189,844 | $ | (76,619 | ) | $ | — | $ | (1,300 | ) | $ | — | $ | (675 | ) | $ | (5,614 | ) | $ | (691 | ) | $ | 104,945 | ||||||||||||
Income before income taxes | $ | 70,234 | $ | (53,482 | ) | $ | 9,970 | $ | 1,300 | $ | — | $ | 675 | $ | — | $ | (1,401 | ) | $ | 27,296 | |||||||||||||||
Provision for income taxes | 13,993 | — | — | — | (13,993 | ) | — | — | — | — | |||||||||||||||||||||||||
Net Income | $ | 56,241 | $ | (53,482 | ) | $ | 9,970 | $ | 1,300 | $ | 13,993 | $ | 675 | $ | — | $ | (1,401 | ) | $ | 27,296 |
Q4 2013 | Q1 2014 | Q2 2014 | Q3 2014 | Q4 2014 | Q1 2015 | Q2 2015 | |||||||||||||||||||||
TRB: | |||||||||||||||||||||||||||
Securitized Product Total Receivables Balance (TRB) Purchases (1) | $ | 214,437 | $ | 223,507 | $ | 252,544 | $ | 228,915 | $ | 234,084 | $ | 234,972 | $ | 231,654 | |||||||||||||
Life Contingent Purchases | 39,054 | 29,827 | 28,185 | 28,471 | 25,107 | 19,499 | 26,807 | ||||||||||||||||||||
Presettlement Fundings | 6,997 | 7,247 | 6,977 | 5,910 | 7,021 | 6,360 | 4,404 | ||||||||||||||||||||
Total TRB Purchases | $ | 260,488 | $ | 260,581 | $ | 287,706 | $ | 263,296 | $ | 266,212 | $ | 260,830 | $ | 262,865 | |||||||||||||
ANI Basis: | |||||||||||||||||||||||||||
Total Revenue | $ | 71,603 | $ | 63,131 | $ | 69,110 | $ | 62,982 | $ | 63,774 | $ | 62,423 | $ | 49,336 | |||||||||||||
Total Expenses | $ | 60,439 | $ | 53,010 | $ | 51,935 | $ | 55,766 | $ | 54,693 | $ | 54,177 | $ | 51,652 | |||||||||||||
ANI | $ | 11,164 | $ | 10,121 | $ | 17,175 | $ | 7,216 | $ | 9,081 | $ | 8,246 | $ | (2,316 | ) | ||||||||||||
ANI Margin (2) | 15.6 | % | 16.0 | % | 24.9 | % | 11.5 | % | 14.2 | % | 13.2 | % | (4.7 | )% | |||||||||||||
ANI TRB Margin (3) | 4.3 | % | 3.9 | % | 6.0 | % | 2.7 | % | 3.4 | % | 3.2 | % | (0.9 | )% | |||||||||||||
Spread Revenue (4) | $ | 44,637 | $ | 51,846 | $ | 57,951 | $ | 51,285 | $ | 52,471 | $ | 50,547 | $ | 37,989 | |||||||||||||
TRB Spread Margin (5) | 17.6 | % | 20.5 | % | 20.6 | % | 19.9 | % | 20.2 | % | 19.9 | % | 14.7 | % | |||||||||||||
GAAP Basis: | |||||||||||||||||||||||||||
Revenue | $ | 106,556 | $ | 136,590 | $ | 123,488 | $ | 107,024 | $ | 127,274 | $ | 86,830 | $ | 61,363 | |||||||||||||
Expenses (6) | $ | 111,918 | $ | 102,057 | $ | 101,780 | $ | 94,335 | $ | 99,591 | $ | 92,290 | $ | 87,996 | |||||||||||||
Net (Loss) Income | $ | (5,362 | ) | $ | 34,533 | $ | 21,708 | $ | 12,689 | $ | 27,683 | $ | (5,460 | ) | $ | (26,633 | ) | ||||||||||
Net (loss) income attributable to The J.G. Wentworth Company | $ | (5,577 | ) | $ | 9,022 | $ | 6,268 | $ | 4,092 | $ | 11,829 | $ | (1,345 | ) | $ | (12,296 | ) | ||||||||||
Weighted Average Diluted Shares | 10,395,574 | 11,642,283 | 12,562,042 | 13,098,995 | 14,640,860 | 14,271,842 | 14,113,990 | ||||||||||||||||||||
All-in Shares (7) | 17,476,995 | 29,555,639 | 29,510,029 | 29,335,338 | 29,019,913 | 28,597,051 | 28,033,035 | ||||||||||||||||||||
Diluted EPS | $ | (0.54 | ) | $ | 0.77 | $ | 0.50 | $ | 0.31 | $ | 0.81 | $ | (0.09 | ) | $ | (0.87 | ) | ||||||||||
ANI EPS (8) | $ | 0.64 | $ | 0.34 | $ | 0.58 | $ | 0.25 | $ | 0.31 | $ | 0.29 | $ | (0.08 | ) | ||||||||||||
Residual Asset Balance | $ | 239,591 | $ | 280,208 | $ | 294,637 | $ | 304,022 | $ | 331,395 | $ | 318,493 | $ | 299,412 | |||||||||||||
Residual Loan Balance | $ | 68,785 | $ | 67,989 | $ | 107,540 | $ | 107,329 | $ | 107,043 | $ | 106,748 | $ | 106,465 | |||||||||||||
10-Year Swap Rate | 3.09 | % | 2.84 | % | 2.63 | % | 2.64 | % | 2.28 | % | 2.02 | % | 2.46 | % | |||||||||||||
Term Loan Interest Expense | $ | 13,457 | $ | 9,917 | $ | 10,020 | $ | 10,082 | $ | 10,182 | $ | 9,932 | $ | 10,019 | |||||||||||||
ANI Interest Expense | $ | 18,298 | $ | 13,945 | $ | 14,487 | $ | 14,651 | $ | 14,808 | $ | 14,627 | $ | 14,389 |
(1) | Securitized product TRB purchases includes purchases during the period of assets that are expected to be securitized (guaranteed structured settlements, annuities, and lottery payment streams) |
(2) | ANI Margin is defined as ANI / ANI Total Revenue |
(3) | ANI TRB Margin is defined as ANI / Total TRB Purchases |
(4) | Spread Revenue is defined as adjusted unrealized gains on VIE and other finance receivables, long term debt and derivatives, net of the loss on swap terminations |
(5) | TRB Spread Margin is defined as Spread Revenue / (the sum of Securitized Product TRB Purchases + Life Contingent Purchases) |
(6) | Includes provision (benefit) for income taxes |
(7) | Represents the weighted average number of outstanding shares of Class A common stock if all Common Interests in The J.G. Wentworth Company, LLC were exchanged. Calculated as the sum of: (a) the weighted average number of Common Interests outstanding and (b) the impact of dilutive potential common shares. |
(8) | ANI EPS is defined as ANI / All-in Shares |