-----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, GNNfC5mPBUcKtA0N9qbjM92Lg7FynwRpyNZcSJs+QiJX4W9YKqQ8csAqvkwPc8s5 nAkI0l+1P9r3GOn0MKrPdg== 0000908662-04-000059.txt : 20040311 0000908662-04-000059.hdr.sgml : 20040311 20040311135925 ACCESSION NUMBER: 0000908662-04-000059 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040310 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040311 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: 04662510 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_8k.txt MICROFINANCIAL 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): March 10, 2004 ---------------------------------------------------------------- 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 7. Financial Statements and Exhibits. --------------------------------- Exhibit Exhibit Title Exhibit 99 Press Release dated March 10, 2004 Item 12. Results of Operations and Financial Condition. --------------------------------------------- Pursuant to Form 8-K, General Instructions F, Registrant hereby incorporates by reference the press release attached hereto as Exhibit 99. 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: March 10, 2004 EX-99 3 exh_99.txt PRESS RELEASE DATED 3/10/04 Exhibit 99 For Release March 10, 2004 Contact: 4:01 pm Richard F. Latour President and CEO Tel: 781-994-4800 MicroFinancial Incorporated Announces Fourth Quarter and Year End 2003 Results Woburn, MA-- March 10, 2004-- MicroFinancial Incorporated (NYSE-MFI) announced today its financial results for the fourth quarter and the year ended December 31, 2003. The reduction in revenues is directly related to the Company's inability to fund new originations beyond October 2002 as a result of its Lenders not renewing MicroFinancial's revolving credit facility on September 30, 2002. Revenues for the year ended December 31, 2003 were $91.6 million, compared to $126.8 million during the same period in fiscal 2002. The net loss for the year ending December 31, 2003 improved to $15.7 million, versus a net loss of $22.1 million for the same period last year. Loss per share for the year improved 30% to ($1.20) on 13,043,744 shares, versus ($1.72) on 12,821,946 shares for the same period last year. Total operating expenses for the year decreased 28.1% to $117.7 million compared to $163.7 million in 2002. Interest expense declined 30.3% to $7.5 million, as a result of lower average debt balances. Selling, general and administrative expenses decreased $11.7 million to $33.9 million for the year ended December 31, 2003, versus $45.5 million for the same period last year. The decrease was driven in part by a reduction in personnel related expenses of approximately $5.8 million, as management reduced headcount from 203 to 136, $2.0 million in collection expenses, $1.8 million in cost of goods sold, and $0.7 million in rent. Depreciation and Amortization expense decreased 9.8% to $16.6 million, compared to $18.4 million in 2002. The provision for credit losses decreased $29.1 million to $59.8 million for the year ended December 31, 2003 from $88.9 million for the same period last year. Gross charge-offs increased 21.9% to $93.2 million while recoveries decreased 39.5% to $7.1 million. Net cash provided by operating activities decreased 18.7% to $98.1 million, compared to $120.6 million last year. Richard Latour, President and Chief Executive Officer said, "I am pleased that the Company repaid debt balances on its senior credit facility and securitizations of $110.1 million in 2003. The Company has outperformed the financial expectations of our bank agreement by accelerating its required repayments." Fourth quarter revenue for the period ended December 31, 2003 decreased 28.7%, or $8.0 million to $20.0 million compared to $28.0 million last year. The net loss per diluted share for the quarter was down slightly at ($0.61), or a net loss of $8.0 million, compared to $7.7 million in the prior year's fourth quarter. The year-over-year decline in net income for the quarter was primarily the result of a reduction of the following: 50.5% in lease and loan revenues to $5.5 million, 32.6% in service fee and other revenues to $2.7 million, and 19.2% in income on service contracts to $1.9 million. The reduction in revenue was primarily related to the suspension in October 2002 of new origination volume. Total operating expenses for the quarter declined 18.5% to $33.3 million compared to the same period in 2002. Interest expense was $1.2 million as a result of lower debt balances. Selling, general and administrative expenses decreased $3.1 million to $8.2 million versus $11.2 million for the same period last year, as the Company continued to align its infrastructure with current business conditions. The provision for credit losses decreased to $19.9 million from $22.5 million for the same period in 2002, while net charge offs increased to $33.3 million versus $28.9 million. Sequentially, past due balances greater than 31 days delinquent on December 31, 2003 decreased to 19.9%. Net cash provided by operating activities for the quarter decreased 31.6% to $19.9 million compared to $29.1 million during the same period in 2002. In addition, the Company repaid debt of $26.7 million on its senior credit facility and securitizations during the quarter. The Company remains in full compliance with the terms and conditions of its securitizations and senior credit facility. The Company has made or exceeded all scheduled payments on these debt instruments in a timely manner. During the quarter, MicroFinancial was able to reduce its bank debt by $18.2 million to $55.3 million. 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 1.1 to 1. MICROFINANCIAL INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share data)
December 31, ------------------------- 2002 2003 ---- ---- ASSETS Net investment in leases and loans: Receivables due in installments $ 334,623 $ 175,788 Estimated residual value 30,754 19,110 Initial direct costs 4,891 1,804 Loans receivable 1,796 -- Less: Advance lease payments and deposits (96) (37) Unearned income (67,574) (23,729) Allowance for credit losses (69,294) (43,011) ---------------------- Net investment in leases and loans $ 235,100 $ 129,925 Investment in service contracts 14,463 8,844 Cash and cash equivalents 5,494 6,533 Restricted cash 18,516 2,376 Property and equipment, net 9,026 5,844 Income taxes receivable 8,652 -- Other assets 3,834 2,892 ---------------------- Total assets $ 295,085 $ 156,414 ====================== LIABILITIES AND STOCKHOLDERS' EQUITY Notes payable $ 168,927 $ 58,843 Subordinated notes payable 3,262 3,262 Capitalized lease obligations 471 209 Accounts payable 3,840 3,186 Other liabilities 6,776 4,104 Income taxes payable 1,400 7,789 Deferred income taxes payable 23,806 7,755 ---------------------- Total liabilities 208,482 85,148 ---------------------- Stockholders' equity: Preferred stock, $.01 par value; 5,000,000 shares authorized; none issued at 12/31/02 and 12/31/03 -- -- Common stock, $.01 par value; 25,000,000 shares authorized; 13,410,646 shares issued at 12/31/02 and 12/31/03 134 134 Additional paid-in capital 47,723 44,245 Retained earnings 45,089 29,402 Treasury stock (588,700 shares of common stock at 12/31/02 and 234,230 shares of common stock at 12/31/03), at cost (6,343) (2,515) ---------------------- Total stockholders' equity 86,603 71,266 ---------------------- Total liabilities and stockholders' equity $ 295,085 $ 156,414 ======================
MICROFINANCIAL INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share data)
For the three months ended December 31, ----------------------------- 2002 2003 ---- ---- Revenues: Income on financing leases and loans $ 11,167 $ 5,532 Income on service contracts 2,402 1,940 Rental income 8,859 8,539 Loss and damage waiver fees 1,567 1,254 Service fees and other 4,032 2,717 -------------------- Total revenues 28,027 19,982 -------------------- Expenses: Selling general and administrative 11,246 8,179 Provision for credit losses 22,488 19,858 Depreciation and amortization 4,182 4,129 Interest 2,964 1,151 -------------------- Total expenses 40,880 33,317 -------------------- Income (loss) before provision (benefit) for income taxes (12,853) (13,335) Provision (benefit) for income taxes (5,142) (5,335) -------------------- Net income (loss) ($ 7,711) ($ 8,000) ==================== Net income (loss) per common share - basic ($ 0.60) ($ 0.61) ==================== Net income (loss) per common share - diluted ($ 0.60) ($ 0.61) ====================
MICROFINANCIAL INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except share and per share data) For the Years Ended December 31, ------------------------------- 2002 2003 ---- ---- Revenues: Income on financing leases and loans $ 53,012 $ 30,904 Income on service contracts 9,734 8,593 Rental income 37,154 34,302 Loss and damage waiver fees 6,257 5,525 Service fees and other 20,665 12,250 ---------------------- Total revenues 126,822 91,574 ---------------------- Expenses: Selling, general and administrative 45,535 33,856 Provision for credit losses 88,948 59,758 Depreciation and amortization 18,385 16,592 Interest 10,787 7,515 ---------------------- Total expenses 163,655 117,721 ---------------------- Income (loss) before provision for income taxes (36,833) (26,147) Provision (benefit) for income taxes (14,735) (10,460) ---------------------- Net income (loss) ($ 22,098) ($ 15,687) ====================== Net income (loss) per common share - basic ($ 1.72) ($ 1.20) ====================== Net income (loss) per common share - diluted ($ 1.72) ($ 1.20) ====================== Dividends per common share $ 0.150 $ 0.000 ====================== 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-----