-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, H1aTkDKi3byHQUEIF07Bb0r4w7jtHQJZnNMQ4ReuTmfG/2E+2ssHQ9sWh4kTBvXr Pc+0PA54PPy4lFIYuMVvIg== 0000950153-95-000109.txt : 19950420 0000950153-95-000109.hdr.sgml : 19950420 ACCESSION NUMBER: 0000950153-95-000109 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950419 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19950419 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FINOVA CAPITAL CORP CENTRAL INDEX KEY: 0000043960 STANDARD INDUSTRIAL CLASSIFICATION: SHORT-TERM BUSINESS CREDIT INSTITUTIONS [6153] IRS NUMBER: 941278569 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-07543 FILM NUMBER: 95529747 BUSINESS ADDRESS: STREET 1: 1850 NORTH CENTRAL AVE STREET 2: PO BOX 2209 CITY: PHOENIX STATE: AZ ZIP: 85004-2209 BUSINESS PHONE: 6022076900 MAIL ADDRESS: STREET 1: FINOVA CAPITAL CORP STREET 2: 1850 NORTH CENTRAL AVE P O BOX 2209 CITY: PHOENIX STATE: AZ ZIP: 85004-2209 FORMER COMPANY: FORMER CONFORMED NAME: GREYHOUND FINANCIAL CORP DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: GREYHOUND LEASING & FINANCIAL CORP DATE OF NAME CHANGE: 19870330 8-K 1 FORM 8-K, DATED APRIL 19, 1995 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C, 20549 -------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 19, 1995 - ------------------------------------------------------------------------------- FINOVA CAPITAL CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 1-7543 94-1278569 - ------------------------------------------------------------------------------- (State or Other Jurisdiction (Commission (I.R.S. Employer of Incorporation) File Number) Identification No.) 1850 NORTH CENTRAL AVENUE, PHOENIX, ARIZONA 85004-2209 - ------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: 602/207-6900 ---------------------------- 2 Item 5. Other Events. FINOVA Capital Corporation (formerly known as Greyhound Financial Corporation) today announced revenues, net income and selected financial data and ratios for the first quarter ended March 31, 1995 (unaudited). Item 7. Financial Statements and Exhibits. (c) Exhibits:
Exhibit Title ----------------- ------------------------------------------- 28 Press Release of FINOVA Capital Corporation dated April 19, 1995
1 3 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. FINOVA CAPITAL CORPORATION (Registrant) Dated: April 19, 1995 By /s/ Bruno A. Marszowski -------------------------------------------------- Bruno A. Marszowski, Senior Vice President, Chief Financial Officer Principal Financial Officer/Authorized Officer 2 EX-28 2 EXHIBIT 28 FOR FIRST QUARTER RESULTS. 1 EXHIBIT 28 Robert J. Fitzsimmons For Immediate Release 602/ 207-5759 4/19/95 THESE ARE THE EARNINGS FOR FINOVA CAPITAL CORPORATION THE PRINCIPAL SUBSIDIARY OF THE FINOVA GROUP INC. WHOSE EARNINGS WERE RELEASED APRIL 18, 1995 FINOVA CAPITAL CORPORATION ANNOUNCES FIRST QUARTER RESULTS PHOENIX, Arizona, April 19, 1995 -- FINOVA Capital Corporation (formerly known as Greyhound Financial Corporation) (the "Company") today reported net income of $22.4 million for the first quarter of 1995 compared to $11.6 million for the first quarter of 1994, a 93% increase in net income. Sam Eichenfield, President, Chairman and Chief Executive Officer of FINOVA Capital, said he was encouraged by the amount of new business added during the first quarter and the build up of the backlog of new business to just under $1 billion. During the first quarter, the Company generated $478 million of new loan and lease business (up 87% from 1994), as well as $381 million of factoring volume, almost double the 1994 level. This new business activity plus $117 million of assets acquired during the quarter resulted in net portfolio growth of $322 million or an annualized growth rate of 23%. 3 2 Interest margins earned contributed significantly to the performance for the quarter but, as a percent of average earning assets, declined from 5.9% for the fourth quarter of 1994 to 5.7% for the first quarter of 1995. "This slight decline in interest margins earned is not indicative of any trend, but is relative more to the fact that growth of funds employed occurred late in the quarter without the full benefit of related interest margins earned on assets for the three month period," Mr. Eichenfield said. A substantial portion of the growth in funds employed during the quarter occurred in March. As a result, the interest margin for the first quarter of 1995 includes only a fraction of the interest margin expected to be earned on the assets added during the quarter. While strong, interest margins for the quarter were expected to decline slightly from the 6% level reported for the full year 1994. In addition to the timing of new business, the expected margin decline resulted, in part, from the cost of interest rate hedging activities during the first quarter of 1995. The Company helped protect its margins on floating-rate transactions by hedging an additional $750 million of floating-rate debt to lock in the spread between the Company's lending and borrowing rates. With these agreements, the Company has protected its margins on $1.5 billion of floating-rate transactions (or approximately 50% of its floating-rate liabilities) during the respective hedge terms. Growth in interest margins more than offset the higher provisions for possible credit losses and the higher selling, administrative and other operating expenses ("operating expenses") in the 1995 period. The Company recorded a greater loss provision in 1995 due to the increased size of the portfolio. Reserves and accrued liabilities for possible credit losses at March 31, 1995 represented 2.0% of managed assets and 70.9% of nonearning assets. The higher operating expenses are primarily attributable to the additions of TriCon Capital, acquired on April 30, 1994, and Ambassador Factors, acquired on February 14, 1994, as well as to expenses incurred in connection with the higher volume of new business added during the quarter. The running rate of these expenses, measured as a percent of interest margins earned, was 47.2% (for the combined entities) in 1995, an increase over 42.6% in 1994. It should be noted that 4 3 the ratio relative to operating expenses was also impacted by the fact that a full quarter's spread was not reflected for the volume of business added during the period. Income taxes were higher in the first quarter of 1995 due to an increase in income before income taxes and to a higher tax rate in effect during the first quarter of 1995 (40.3% in 1995 vs. 37.8% in 1994). FINOVA Capital Corporation is a Phoenix-based major domestic commercial finance company providing secured financing and leasing products to small and medium sized businesses from $500,000 to $35 million. FINOVA also offers inventory and sales financing programs to manufacturers, distributors and dealers nationwide. #### 5 4 FINOVA CAPITAL CORPORATION AND CONSOLIDATED SUBSIDIARIES SUMMARY OF CONSOLIDATED INCOME (UNAUDITED) (Dollars in Thousands)
Three Months Ended March 31, ------------------------ 1995 1994 ------------------------ Interest earned from financing transactions $174,757 $73,961 Interest expense 84,524 33,862 Depreciation 12,743 1,957 -------- ------- Interest margins earned 77,490 38,142 Provision for possible credit losses 6,400 3,250 Gains on sale of assets 2,980 3 Selling, administrative and other operating expenses 36,575 16,241 -------- ------- Income before income taxes 37,495 18,654 Income taxes 15,127 7,058 -------- ------- Net Income $ 22,368 $11,596 ======== =======
6 5 FINOVA CAPITAL CORPORATION SELECTED CONSOLIDATED FINANCIAL DATA AND RATIOS (UNAUDITED) (1) (Dollars in Thousands)
Three Months Ended Year or at Ended March 31, or at December 31, ------------------------------- ---------- 1995 1994 1994 FINANCIAL DATA: ---------- ----------- ---------- Average funds employed (AFE) and securitizations (2) $6,060,470 $3,059,227 $4,629,578 Ending funds employed (EFE) 5,989,461 3,271,882 5,667,644 Securitizations (2) 210,448 253,386 Average earning assets (3) 5,430,923 2,723,183 4,064,971 Reserve and accrued liabilities (4) for possible credit losses 122,953 73,057 122,233 Nonaccruing assets 173,493 122,707 168,761 Total debt 4,847,273 2,510,590 4,573,354 Stockholders' equity 800,697 392,823 781,986 New business 477,791 254,701 1,799,331 Backlog (includes lines of credit) 955,656 486,242 764,326 Factoring volume 381,294 130,749 1,129,936 Write-offs 8,885 5,106 35,127 RATIOS: Write-offs (annualized) as a % of AFE and average securitizations (2) 0.6% 0.7% 0.8% Nonaccruing assets as a % of EFE and securitizations (2) 2.8% 3.8% 2.9% Reserve and accrued liabilities (4) for possible credit losses as a % of: Ending funds employed and securitizations (2) 2.0% 2.2% 2.1% Nonaccruing assets 70.9% 59.5% 72.4% Interest margins earned (annualized) as a % of average earning assets (3) 5.7% 5.6% 6.0% Selling, administrative and other operating expenses as a % of interest margins earned 47.2% 42.6% 46.1% Total debt to equity 6.05 6.39 5.85
- ------------ (1) Includes financial results from Ambassador and TriCon subsequent to their acquisitions on February 14, 1994 and April 30, 1994, respectively. 7 6 (2) Securitizations are assets sold under securitization agreements and managed by the Company. Average contracts securitized were $232 million and $183 million for March 31, 1995 and December 31, 1994, respectively. (3) Average earning assets equal AFE less average deferred taxes on leveraged leases ($227 million, $223 million and $225 million for March 31, 1995 and 1994 and December 31, 1994, respectively) and average nonaccruing assets ($171 million, $113 million and $157 million for March 31, 1995 and 1994 and December 31, 1994, respectively). (4) Accrued liabilities of $13 million at March 31, 1995 and December 31, 1994 represent an allowance for estimated losses under certain recourse provisions of securitizations. -----END PRIVACY-ENHANCED MESSAGE-----