MARYLAND | 814-01035 | 46-3755188 |
(State or Other Jurisdiction of Incorporation or Organization) | (Commission File No.) | (I.R.S. Employer Identification No.) |
Exhibit Number | Description | |
99.1 | Press Release, dated November 2, 2016, entitled “Newtek Business Services Corp. Reports Third Quarter 2016 Financial Results; Achieves Record Loan Fundings of $85.9 Million for Third Quarter; Forecasts 2017 Annual Cash Dividend of $1.57 per Share.” |
NEWTEK BUSINESS SERVICES CORP. | ||
Date: November 2, 2016 | By: | /S/ BARRY SLOANE |
Barry Sloane | ||
Chairman of the Board and Chief Executive Officer |
Exhibit Number | Description | |
99.1 | Press Release, dated November 2, 2016, entitled “Newtek Business Services Corp. Reports Third Quarter 2016 Financial Results; Achieves Record Loan Fundings of $85.9 Million for Third Quarter; Forecasts 2017 Annual Cash Dividend of $1.57 per Share.” |
Exhibit 99.1 | |
• | Net asset value (“NAV”) of $208.2 million, or $14.26 per share, at September 30, 2016; an increase of 1.9% over NAV of $204.4 million, or $14.11 per share, at June 30, 2016 and an increase of 2.1% over NAV of $203.9 million, or $14.06 per share, at December 31, 2015. |
• | Total investment income of $7.9 million; an 11.6% increase over $7.0 million for the quarter ended September 30, 2015. |
• | Total investment portfolio increased by 22.5% to $326.9 million at September 30, 2016, from $266.9 million at December 31, 2015. |
• | Net investment loss of $(2.1) million, or $(0.15) per share, compared to $(1.5) million, or $(0.14) per share, for the three months ended September 30, 2015. |
• | Adjusted net investment income1 of $6.7 million, or $0.46 per share; a 31.4% increase over $5.1 million, or $0.49 per share, for the three months ended September 30, 2015. |
• | Funded $85.9 million of SBA 7(a) loans in the third quarter of 2016; an increase of a 33.7% over the same period one year ago. |
• | For the nine months ended September 30, 2016, SBA 7(a) loan fundings increased by 29.8% to $217.8 million compared to $167.8 million for the same period one year ago. |
• | Reaffirmed 2016 loan funding forecast of approximately $320 million in SBA 7(a) and SBA 504 loans (note: SBA 504 loans are funded by Newtek Business Credit Solutions (“NBC”), one of Newtek’s controlled portfolio companies), which would represent an approximate 32% increase over 2015. |
• | As of October 31, 2016, there were approximately $20 million of SBA 504 loans in the pipeline. |
• | Paid third quarter 2016 dividend of $0.432 per share, on September 30, 2016 to shareholders of record as of September 20, 2016. |
• | Reaffirmed 2016 annual cash dividend forecast of approximately $22.2 million, or 1.532 per share. |
• | The Company forecasts paying an annual cash dividend of $1.572 per share in 2017, a 2.6% increase over the 2016 annual dividend forecast of $1.53 per share. |
NEWTEK BUSINESS SERVICES CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES (In Thousands, except for Per Share Data) | |||||||
September 30, 2016 | December 31, 2015 | ||||||
ASSETS | (Unaudited) | ||||||
Investments, at fair value | |||||||
SBA unguaranteed non-affiliate investments (cost of $204,459 and $166,752, respectively; includes $135,075 and $146,463, respectively, related to securitization trusts) | $ | 196,624 | $ | 158,355 | |||
SBA guaranteed non-affiliate investments (cost of $7,849 and $2,069, respectively) | 8,754 | 2,284 | |||||
Controlled investments (cost of $41,094 and $35,781, respectively) | 120,420 | 104,376 | |||||
Non-control/non-affiliate investments (cost of $1,020 and $1,847, respectively) | 1,020 | 1,824 | |||||
Investments in money market funds (cost of $35 and $35, respectively) | 35 | 35 | |||||
Total investments at fair value | 326,853 | 266,874 | |||||
Cash and cash equivalents | 2,718 | 4,308 | |||||
Restricted cash | 24,781 | 22,869 | |||||
Broker receivable | 21,495 | 32,083 | |||||
Due from related parties | 3,012 | 3,056 | |||||
Servicing assets, at fair value | 15,619 | 13,042 | |||||
Credits in lieu of cash, at fair value | 216 | 860 | |||||
Other assets | 10,155 | 9,338 | |||||
Total assets | $ | 404,849 | $ | 352,430 | |||
LIABILITIES AND NET ASSETS | |||||||
Liabilities: | |||||||
Bank notes payable | $ | 49,919 | $ | 29,100 | |||
Notes due 2022 | 7,832 | 7,770 | |||||
Notes due 2021 | 38,680 | — | |||||
Notes payable - Securitization trusts | 73,471 | 89,244 | |||||
Dividends payable | — | 5,802 | |||||
Notes payable - related parties | 7,400 | 5,647 | |||||
Due to related parties | 1,191 | 256 | |||||
Notes payable in credits in lieu of cash, at fair value | 216 | 860 | |||||
Deferred tax liability | 5,327 | 857 | |||||
Accounts payable, accrued expenses and other liabilities | 12,641 | 8,945 | |||||
Total liabilities | 196,677 | 148,481 | |||||
Commitments and contingencies | |||||||
Net Assets: | |||||||
Preferred stock (par value $0.02 per share; authorized 1,000 shares, no shares issued and outstanding) | — | — | |||||
Common stock (par value $0.02 per share; authorized 200,000 shares, 14,594 and 14,509 issued and outstanding, respectively) | 292 | 290 | |||||
Additional paid-in capital | 188,647 | 189,031 | |||||
Undistributed net investment income | (3,150 | ) | 4,437 | ||||
Net unrealized appreciation, net of deferred taxes | 14,128 | 8,062 | |||||
Net realized gains | 8,255 | 2,129 | |||||
Total net assets | 208,172 | 203,949 | |||||
Total liabilities and net assets | $ | 404,849 | $ | 352,430 | |||
Net asset value per common share | $ | 14.26 | $ | 14.06 |
Three Months Ended September 30, 2016 | Three Months Ended September 30, 2015 | Nine Months Ended September 30, 2016 | Nine Months Ended September 30, 2015 | ||||||||||||
Investment income: | |||||||||||||||
From non-affiliate investments: | |||||||||||||||
Interest income | $ | 2,583 | $ | 2,153 | $ | 7,404 | $ | 6,509 | |||||||
Servicing income | 1,551 | 1,262 | 4,581 | 3,373 | |||||||||||
Other income | 692 | 472 | 1,913 | 1,331 | |||||||||||
Total investment income from non-affiliate investments | 4,826 | 3,887 | 13,898 | 11,213 | |||||||||||
From controlled investments: | |||||||||||||||
Interest income | 92 | 58 | 251 | 202 | |||||||||||
Dividend income | 2,933 | 3,093 | 7,719 | 5,967 | |||||||||||
Other income | — | — | — | 12 | |||||||||||
Total investment income from controlled investments | 3,025 | 3,151 | 7,970 | 6,181 | |||||||||||
Total investment income | 7,851 | 7,038 | 21,868 | 17,394 | |||||||||||
Expenses: | |||||||||||||||
Salaries and benefits | 3,439 | 3,444 | 10,412 | 9,600 | |||||||||||
Stock-based compensation | 226 | — | 226 | — | |||||||||||
Interest | 2,341 | 1,864 | 5,804 | 4,948 | |||||||||||
Depreciation and amortization | 84 | 87 | 209 | 257 | |||||||||||
Loss on lease | (152 | ) | (74 | ) | 1,335 | (218 | ) | ||||||||
Other general and administrative costs | 4,038 | 3,208 | 11,468 | 9,069 | |||||||||||
Total expenses | 9,976 | 8,529 | 29,454 | 23,656 | |||||||||||
Net investment loss | (2,125 | ) | (1,491 | ) | (7,586 | ) | (6,262 | ) | |||||||
Net realized and unrealized gains (losses): | |||||||||||||||
Net realized gain on non-affiliate investments | 8,716 | 6,620 | 22,536 | 21,659 | |||||||||||
Net unrealized (depreciation) appreciation on SBA guaranteed non-affiliate investments | (78 | ) | (48 | ) | 690 | (3,210 | ) | ||||||||
Net unrealized appreciation (depreciation) on SBA unguaranteed non-affiliate investments | 1,418 | (531 | ) | 869 | (1,667 | ) | |||||||||
Net unrealized appreciation on controlled investments | 4,638 | 770 | 10,362 | 10,289 | |||||||||||
Provision for deferred taxes on unrealized appreciation on controlled investments | (2,028 | ) | — | (4,469 | ) | — | |||||||||
Net unrealized depreciation on non-control/non-affiliate investments | — | — | (43 | ) | — | ||||||||||
Net unrealized depreciation on servicing assets | (500 | ) | (565 | ) | (1,341 | ) | (1,177 | ) | |||||||
Net unrealized depreciation on credits in lieu of cash and notes payable in credits in lieu of cash | (1 | ) | (6 | ) | (2 | ) | (4 | ) | |||||||
Net realized and unrealized gains | 12,165 | 6,240 | 28,602 | 25,890 | |||||||||||
Net increase in net assets | $ | 10,040 | $ | 4,749 | $ | 21,016 | $ | 19,628 | |||||||
Net increase in net assets per share | $ | 0.69 | $ | 0.46 | $ | 1.45 | $ | 1.92 | |||||||
Net investment loss per share | $ | (0.15 | ) | $ | (0.14 | ) | $ | (0.52 | ) | $ | (0.61 | ) | |||
Dividends declared per common share | $ | 0.43 | $ | — | $ | 1.13 | $ | 0.86 | |||||||
Weighted average shares outstanding | 14,556 | 10,318 | 14,515 | 10,244 |
(in thousands, except per share amounts) | Three months ended September 30, 2016 | Per share | Three months ended September 30, 2015 | Per share | ||||||||||||
Net investment loss | $ | (2,125 | ) | $ | (0.15 | ) | $ | (1,491 | ) | $ | (0.15 | ) | ||||
Net realized gain on non-affiliate debt investments | 8,712 | 0.60 | 6,620 | 0.65 | ||||||||||||
Loss on lease | (152 | ) | (0.01 | ) | (74 | ) | (0.01 | ) | ||||||||
Stock-based compensation | 226 | 0.02 | — | — | ||||||||||||
Adjusted net investment income | $ | 6,661 | $ | 0.46 | $ | 5,055 | $ | 0.49 | ||||||||
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