-----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, GmHfI/NRJVLUdLXXK6CwpeR97GIGHLU61JBeQv1nujmNrCzkGl52k6ADfrSViKWc Dlwi3iHvJqxcQGregzg63Q== 0000908662-02-000227.txt : 20021031 0000908662-02-000227.hdr.sgml : 20021031 20021031153152 ACCESSION NUMBER: 0000908662-02-000227 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20021030 ITEM INFORMATION: Other events FILED AS OF DATE: 20021031 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MICROFINANCIAL INC CENTRAL INDEX KEY: 0000827230 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS BUSINESS CREDIT INSTITUTION [6159] IRS NUMBER: 042962824 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14771 FILM NUMBER: 02804949 BUSINESS ADDRESS: STREET 1: 950 WINTER STREET CITY: WALTHAM STATE: MA ZIP: 02154 BUSINESS PHONE: 7818900177 MAIL ADDRESS: STREET 1: 950 WINTER STREET CITY: WALTHAM STATE: MA ZIP: 02154 FORMER COMPANY: FORMER CONFORMED NAME: BOYLE LEASING TECHNOLOGIES INC DATE OF NAME CHANGE: 19980605 8-K 1 form_8k.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (date of earliest event reported): October 30, 2002 ------------------------------------------------------------------ MICROFINANCIAL INCORPORATED --------------------------- (Exact name of registrant as specified in its charter) MASSACHUSETTS ------------- (State or other jurisdiction of incorporation) 1-14771 04-2962824 ------------------------------------------------------------------ (Commission file number) (IRS Employer Identification Number) 950 WINTER STREET, WALTHAM, MASSACHUSETTS 02451 ----------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (781) 890-0177 ------------------------------------------------------------------ Item 5. Other Events. ------------ Pursuant to Form 8-K, General Instructions F, Registrant hereby incorporates by reference the press release attached hereto as Exhibit 99(a). Exhibit Exhibit Title ------- ------------- Exhibit 99(a) Press Release dated October 30, 2002 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. MICROFINANCIAL INCORPORATED Registrant By: /s/ Richard F. Latour ------------------------------------------ Richard F. Latour President Dated: October 31, 2002 EX-99 3 exhi_99.txt EXHIBIT 99(A) - PRESS RELEASE Exhibit 99(a) Press Release Richard F. Latour President and CEO Tel: 781-890-0177 Fax: 781-890-1368 MicroFinancial Incorporated Announces Third Quarter 2002 Results Waltham, MA--October 30, 2002-- MicroFinancial Incorporated (NYSE-MFI), a leader in Microticket leasing and finance, announced today its financial results for the third quarter and the nine months ended September 30, 2002. Third quarter revenue for the period ended September 30, 2002 decreased 22%, or $8.8 million to $30.5 million compared to $39.3 million last year. Net income for the third quarter, before an additional provision of $35 million discussed below, was $1.4 million, or $0.11 per diluted share as compared with $3.6 million or $0.28 per diluted share in the prior year's third quarter. After the additional provision, earnings were a net loss of $19.6 million, or ($1.53) per diluted share. Besides the additional provision, the decline in earnings for the quarter is primarily the result of a 29% reduction in lease and loan revenues to $12.8 million and a 43% decline in service fee and other revenues to $4.4 million as compared with the third quarter ended September 30, 2001. Additionally, gross lease investment was down 7.8% or $34.4 million from the same period last year, caused in part by lower than anticipated lease origination volumes. As part of management's ongoing analysis of its portfolio, it has determined that an additional allowance of $35 million is warranted. This additional allowance will provide for 104% coverage of our 90-day past due accounts as compared to previous quarters which had coverage in the 50-60% range. This provision will reserve against certain dealer receivables, as well as delinquent portfolio assets. In the past, dealer receivables had been offset, in some instances, against the funding of new contracts. Since we have temporarily suspended the funding of new deals we feel that the collection of these receivables will be more difficult. Although the company will continue to pursue collections on these accounts, management believes that the cost associated with the legal enforcement would outweigh the benefits realized. Total operating expenses for the quarter before the additional provision remained relatively flat at $28 million compared to the same period in 2001. Interest expense declined 29% to $2.5 million as a result of lower debt balances of approximately $9.0 million and lower interest costs of approximately 162 basis points. Selling, General and Administrative expenses decreased $0.6 million to $10.3 million for the third quarter ended September 30, 2002 versus $10.9 million for the same period last year. The majority of the decreases are attributable to reductions in personnel related expenses and collection expenses. The provision for credit losses, before the additional provision, decreased to $9.7 million for the quarter ended September 30, 2002 from $15.1 million for the same period last year, while net charge offs decreased 17% to $9.8 million. Past due balances greater than 31 days delinquent at September 30, 2002 increased to 17.2% from 17.0% last quarter. Revenues for the nine months ended September 30, 2002 decreased 16% to $98.8 million compared to $117.2 million during the same period in fiscal 2001. Net income for the nine months ending September 30, 2002 was $6.6 million before the additional provision. Including the additional provision, the net loss for the nine months ending September was $14.4 million versus net income of $14.2 million for the same period last year. Fully diluted earnings per share for the nine months was $0.51 before the provision. Including the additional provision, fully diluted earnings per share for the nine months was a loss of $1.12 versus a profit of $1.10 for the same period in 2001. Based upon the results for the third quarter, the company is no longer in compliance with the terms of its revolving credit facility. Management is in the process of working with its lenders to receive a waiver for the covenant violation. Management recently announced that it is in the process of generating a plan to revise its capital structure, and business and operating strategy in order to streamline the business during these difficult economic times. The revolving credit facility was converted to a three-year term loan on September 30, 2002. MicroFinancial will hold a webcast of its teleconference to discuss the financial results with the financial community today, October 30, 2002, at 4:30 p.m. Eastern Time. The webcast can be located at www.microfinancial.com under the investor relations section of the website. A telephone replay will also be available for six weeks starting one hour after the conclusion of the teleconference. Interested persons may listen to the playback of the teleconference by calling the following toll-free number: (877) 289-8525 toll free or 416-640-1917 for international callers and entering the passcode number 201445. MICROFINANCIAL INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data) (Unaudited)
December 31, September 30, ---------------------------------- 2001 2002 ---- ---- ASSETS Net investment in leases and loans: Receivables due in installments $399,361 $373,756 Estimated residual value 37,114 32,115 Initial direct costs 7,090 5,597 Loans receivable 2,248 1,911 Less: Advance lease payments and deposits (287) (130) Unearned income (104,538) (77,900) Allowance for credit losses (45,026) (75,726) ----------------- ---------------- Net investment in leases and loans $295,962 $259,623 Investment in service contracts 14,126 15,632 Cash and cash equivalents 4,429 9,916 Restricted Cash 16,216 15,362 Property and equipment, net 16,034 11,033 Other assets 14,961 12,643 ----------------- ---------------- Total assets $361,728 $324,209 ================= ================ LIABILITIES AND STOCKHOLDERS' EQUITY Notes payable $203,053 $194,003 Subordinated notes payable 3,262 3,262 Capitalized lease obligations 833 593 Accounts payable 2,517 2,475 Dividends payable 642 641 Other liabilities 6,182 7,166 Income taxes payable 4,211 1,659 Deferred income taxes payable 30,472 20,131 ----------------- ---------------- Total liabilities 251,172 229,930 ----------------- ---------------- Commitments and contingencies - - Stockholders' equity: Preferred stock, $.01 par value; 5,000,000 shares authorized; no shares issued at 12/31/01 and 9/30/02 - - Common stock, $.01 par value; 25,000,000 shares authorized; 13,410,646 shares issued at 12/31/01 and 9/30/02 134 134 Additional paid-in capital 47,723 47,723 Retained earnings 69,110 52,800 Treasury stock (588,700 shares of common stock at 12/31/01, 588,700 shares of common stock at 9/30/02), at cost (6,343) (6,343) Notes receivable from officers and employees (68) (35) ----------------- ---------------- Total stockholders' equity 110,556 94,279 ----------------- ---------------- Total liabilities and stockholders' equity $361,728 $324,209 ================= ================
MICROFINANCIAL INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share data) (Unaudited)
For the three months ended For the nine months ended September 30, September 30, ------------------------------- ------------------------------- 2001 2002 2001 2002 ---- ---- ---- ---- Revenues: Income on financing leases and loans $18,105 $12,819 $54,897 $41,845 Income on service contracts 2,186 2,479 6,420 7,332 Rental income 9,744 9,212 28,131 28,295 Loss and damage waiver fees 1,598 1,633 4,746 4,691 Service fees and other 7,676 4,406 23,010 16,632 ------------------------------- ------------------------------- Total revenues 39,309 30,549 117,204 98,795 ------------------------------- ------------------------------- Expenses: Selling general and administrative 10,899 10,306 33,462 34,289 Provision for credit losses 15,064 44,672 37,150 66,460 Depreciation and amortization 3,618 5,713 10,700 14,203 Interest 3,445 2,458 11,307 7,823 ------------------------------- ------------------------------- Total expenses 33,026 63,149 92,619 122,775 ------------------------------- ------------------------------- Income before provision for income taxes 6,283 (32,600) 24,585 (23,980) Provision for income taxes 2,644 (13,042) 10,348 (9,593) ------------------------------- ------------------------------- Net income $3,639 ($19,558) $14,237 ($14,387) =============================== =============================== Net income per common share - basic $0.28 ($1.53) $1.11 ($1.12) =============================== =============================== Net income per common share - diluted $0.28 ($1.53) $1.10 ($1.12) =============================== =============================== Weighted-average shares used to compute: Basic net income per share 12,825,139 12,821,946 12,775,519 12,821,946 ------------------------------- ------------------------------- Fully diluted net income per share 13,094,690 12,821,946 12,988,959 12,862,105 ------------------------------- -------------------------------
MicroFinancial Inc. (NYSE: MFI), headquartered in Waltham, MA, and with additional locations in Woburn, MA and Herndon, VA, is a financial intermediary specializing in leasing and financing for products in the $500 to $10,000 range. The company has been in operation since 1986 and has been profitable each year since 1987. Statements in this release that are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In addition, words such as "believes," "anticipates," "expects," "views, " and similar expressions are intended to identify forward-looking statements. The Company cautions that a number of important factors could cause actual results to differ materially from those expressed in any forward-looking statements made by or on behalf of the Company. Readers should not place undue reliance on forward-looking statements, which reflect the management's view only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances. The Company cannot assure that it will be able to anticipate or respond timely to changes which could adversely affect its operating results in one or more fiscal quarters. Results of operations in any past period should not be considered indicative of results to be expected in future periods. Fluctuations in operating results may result in fluctuations in the price of the Company's common stock. For a more complete description of the prominent risks and uncertainties inherent in the Company's business, see the risk factors described in documents the Company files from time to time with the Securities and Exchange Commission. -----END PRIVACY-ENHANCED MESSAGE-----