-----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, TfZ7DLnPSsPNslBwoETUaDCvF8oTeaYhkdxBIENi0JmRY56HCQbBLOhtJs/Olx3g bM8acKbdAPKXCZfOJ5Nm7w== 0000908662-03-000088.txt : 20030416 0000908662-03-000088.hdr.sgml : 20030416 20030416145209 ACCESSION NUMBER: 0000908662-03-000088 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030416 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030416 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: 03652411 BUSINESS ADDRESS: STREET 1: 10 M COMMERCE WAY CITY: WOBURN STATE: MA ZIP: 01801 BUSINESS PHONE: 7819944800 MAIL ADDRESS: STREET 1: 10 M COMMERCE WAY CITY: WOBURN STATE: MA ZIP: 01801 FORMER COMPANY: FORMER CONFORMED NAME: BOYLE LEASING TECHNOLOGIES INC DATE OF NAME CHANGE: 19980605 8-K 1 form_8-k.txt DATE OF REPORT: 4/16/03 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): April 16, 2003 ---------------------------------------------------------------- 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) 10-M Commerce Way, Woburn, MA 01801 ----------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: 781-994-4800 ---------------------------------------------------------------- N/A --- (Former name or former address, if changed since last report) Item 5. Other Events. ------------ Pursuant to Form 8-K, General Instructions F, Registrant hereby incorporates by reference the press releases attached hereto as Exhibits 99(a) and 99(b). Item 7. Financial Statements and Exhibits. --------------------------------- Exhibit Exhibit Title ------- ------------- Exhibit 99(a) Press Release dated April 16, 2003 Exhibit 99(b) Press Release dated April 16, 2003 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/ James Jackson ------------------------------------------- James Jackson Vice President and Chief Financial Officer Dated: April 16, 2003 EX-99 3 exh_99.txt EXHIBIT 99(A) Exhibit 99(a) For Immediate Release Contact: Richard F. Latour President and CEO Tel: 781-994-4800 MicroFinancial Incorporated Announces Fourth Quarter and Year End 2002 Results Waltham, MA-- April 16, 2003-- MicroFinancial Incorporated (NYSE-MFI), a leader in Microticket leasing and finance, announced today its financial results for the fourth quarter and the year ended December 31, 2002. Fourth quarter revenue for the period ended December 31, 2002 decreased 24.0%, or $8.9 million to $28.0 million compared to $36.9 million last year. The net loss for the quarter was $7.7 million, or ($0.60) per diluted share as compared with net income of $2.1 million or $0.16 per diluted share in the prior year's fourth quarter. The decline in net income for the quarter is primarily the result of a 30.4% decline in lease and loan revenues to $11.2 million, a 46.1% decline in service fee and other revenues to $4.0 million, and a 32.7% increase in the provision for credit losses to $22.5 million as compared with the fourth quarter ended December 31, 2001. While revenue reductions were primarily related to lower origination volume, the additional provision for credit losses was required to maintain the Company's reserve policy requirements. Total operating expenses for the quarter, before the provision for credit losses, remained relatively flat at $18.4 million compared to the same period in 2001. Interest expense declined 1.0% to $3.0 million as a result of lower debt balances of approximately $34.0 million offset by increased interest costs. Selling, general and administrative expenses decreased $200,000 to $11.2 million for the fourth quarter ended December 31, 2002 versus $11.4 million for the same period last year. The decrease was attributable to reductions in personnel related expenses of approximately $1.8 million, which was offset by increases in legal expenses. The provision for credit losses increased to $22.5 million for the quarter ended December 31, 2002 from $16.9 million for the same period last year, while net charge offs increased to $28.8 million. Past due balances greater than 31 days delinquent at December 31, 2002 increased to 22.9% from 17.2% last quarter. Net cash provided by operating activities for the quarter decreased 4.0% to $29.1 million compared to $30.2 million during the same period in 2001. Revenues for the year ended December 31, 2002 decreased 18.0% to $126.8 million compared to $154.0 million during the same period in fiscal 2001. The net loss for the year ending December 31, 2002 was $22.1 million versus net income of $16.3 million for the same period last year. Fully diluted earnings per share for the year was a loss of $1.72 on 12,862,834 shares. Total operating expenses for the year, before the provision for credit losses, increased 2.0% to $74.7 million compared to $73.6 million in 2001. Interest expense declined 25.0% to $10.8 million as a result of lower average debt balances of approximately $17.3 million and lower interest costs of approximately 122 basis points. Selling, general and administrative expenses increased $600,000 to $45.5 million for the year ended December 31, 2002 versus $44.9 million for the same period last year. The decrease was driven by a reduction in personnel related expenses of approximately $2.1 million, as management reduced headcount from 380 to 203, but this was offset by increases in legal expenses. Depreciation and Amortization increased 28.0% to $18.3 million compared to $14.4 million in 2001. The provision for credit losses, including the additional provision of $35.0 million taken in the third quarter of 2002, increased to $88.9 million for the year ended December 31, 2002 from $54.1 million for the same period last year. The additional provision was required to reserve against dealer receivables and certain portfolio assets. Net charge-offs increased 27.0% to $65.0 million and gross lease investment was down 16.0% or $71.1 million from the same period last year, primarily caused by lower origination volume activity in 2002. Net cash provided by operating activities for the year ended December 31, 2002 decreased 1.0% to $120.6 million compared to $122.3 million for the year ended December 31, 2001. MicroFinancial Incorporated continues to operate without the use of gain on sale accounting treatment and a balance sheet with total liabilities less subordinated debt to total equity plus subordinated debt of 2.3 to 1. MICROFINANCIAL INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data)
December 31, December 31, ---------------------------------- 2001 2002 ---- ---- ASSETS Net investment in leases and loans: Receivables due in installments $ 399,361 $ 334,623 Estimated residual value 37,114 30,754 Initial direct costs 7,090 4,891 Loans receivable 2,248 1,796 Less: Advance lease payments and deposits (287) (96) Unearned income (104,538) (67,574) Allowance for credit losses (45,026) (69,294) --------- --------- Net investment in leases and loans $ 295,962 $ 235,100 Investment in service contracts 14,126 14,463 Cash and cash equivalents 4,429 5,494 Restricted Cash 16,216 18,516 Property and equipment, net 16,034 9,026 Income taxes receivable -- 8,652 Other assets 14,961 3,834 --------- --------- Total assets $ 361,728 $ 295,085 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Notes payable $ 203,053 $ 168,927 Subordinated notes payable 3,262 3,262 Capitalized lease obligations 833 471 Accounts payable 2,517 3,840 Dividends payable 642 -- Other liabilities 6,182 6,776 Income taxes payable 4,211 1,400 Deferred income taxes payable 30,472 23,806 --------- --------- Total liabilities 251,172 208,482 --------- --------- Commitments and contingencies -- -- Stockholders' equity: Preferred stock, $.01 par value; 5,000,000 shares authorized; no shares issued at 12/31/01 and 12/31/02 -- -- --------- --------- Common stock, $.01 par value; 25,000,000 shares authorized; 13,410,646 shares issued at 12/31/01 and 12/31/02 134 134 Additional paid-in capital 47,723 47,723 Retained earnings 69,110 45,089 Treasury stock (588,700 shares of common stock at 12/31/01 and 12/31/02), at cost (6,343) (6,343) Notes receivable from officers and employees (68) -- --------- --------- Total stockholders' equity 110,556 86,603 --------- --------- Total liabilities and stockholders' equity $ 361,728 $ 295,085 ========= =========
For the three months ended December 31, -------------------------------- 2001 2002 ---- ---- Revenues: Income on financing leases and loans $16,035 $11,167 Income on service contracts 2,245 2,402 Rental income 9,533 8,859 Loss and damage waiver fees 1,598 1,567 Service fees and other 7,477 4,033 -------------------------------- Total revenues 36,888 28,028 -------------------------------- Expenses: Selling general and administrative 11,438 11,246 Provision for credit losses 16,942 22,488 Depreciation and amortization 3,678 4,182 Interest 2,994 2,964 -------------------------------- Total expenses 35,052 40,880 -------------------------------- Income (loss) before provision (benefit) for income taxes 1,836 (12,852) Provision (benefit) for income taxes (244) (5,142) -------------------------------- Net income (loss) $2,080 ($7,710) ================================ Net income (loss) per common share - basic $0.16 ($0.60) ================================ Net income (loss) per common share - diluted $0.16 ($0.60) ================================
For the Years Ended December 31, -------------------------------- 2001 2002 ---- ---- Revenues: Income on financing leases and loans $70,932 $53,012 Income on service contracts 8,665 9,734 Rental income 37,664 37,154 Loss and damage waiver fees 6,344 6,257 Service fees and other 30,486 20,665 -------------------------------- Total revenues 154,091 126,822 -------------------------------- Expenses: Selling general and administrative 44,899 45,535 Provision for credit losses 54,092 88,948 Depreciation and amortization 14,378 18,385 Interest 14,301 10,787 -------------------------------- Total expenses 127,670 163,655 -------------------------------- Income (loss) before provision (benefit) for income taxes 26,421 (36,833) Provision (benefit) for income taxes 10,104 (14,735) -------------------------------- Net income (loss) $16,317 ($22,098) ================================ Net income (loss) per common share - basic $1.28 ($1.72) ================================ Net income (loss) per common share - diluted $1.26 ($1.72) ================================
MicroFinancial Inc. (NYSE: MFI), headquartered in Woburn, MA, 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. 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. EX-99 4 exh_99b.txt EXHIBIT 99(B) Exhibit 99(b) FOR IMMEDIATE RELEASE Contact: Richard F. Latour President and CEO Tel: 781-994-4800 MICROFINANCIAL INCORPORATED ANNOUNCES A FINAL AMENDMENT TO ITS CREDIT AGREEMENT - All Existing Lenders Participate in New Agreement - Woburn, MA-- April 16, 2003-- MicroFinancial Incorporated (NYSE-MFI), a leader in Microticket leasing and finance, today announced that it has secured an amendment to its Credit Agreement and received permanent waivers under its securitization facility. The Company indicated that it has signed an agreement that amends its credit facility and stabilizes the Company's relationship with its lenders. The agreement also modifies the final maturity date to January of 2005. The terms of the amended credit facility require the balance of the approximately $110 million senior term loan be paid out over the next 22 months. The loan will accrue interest at a rate of prime plus 2%, which will be payable monthly. Certain financial covenants such as fixed charge coverage, debt to net worth ratios, and minimum allowance balance requirements were eliminated. The credit facility was originally entered into on August 2000. This amendment replaces the Forbearance and Modification Agreement from the senior credit facility that expired on February 7, 2003. The Company also announced today that it has obtained a permanent waiver for its securitization agreements that will waive each existing event of default retroactively to the date the event of default occurred. It will also waive specific future events of default under the terms of the securitization agreements. This document will replace the temporary waiver which expired on April 15, 2003. Richard Latour, President and Chief Operating Officer stated, "We are pleased to have secured a long-term amendment of our credit facility and securitzation from both our bank group and our securitzation lenders. We believe that this provides a solid foundation that will allow us to focus our attention on seeking a financial partner as we actively consider various financing, restructuring and strategic alternatives." The Company filed its Form 10K with the Securities and Exchange Commission on April 15, 2003. About MicroFinancial MicroFinancial Inc. (NYSE: MFI), headquartered in Woburn, MA, 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. 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-----