EX-99 2 b65245miexv99.htm EX-99 PRESS RELEASE DATED APRIL 25, 2007 exv99
 

Exhibit 99  
(microfinancial Logo)
     
April 25, 2007
  Contact:
4:01 PM
  Richard F. Latour
 
  President and CEO
 
  Tel: 781-994-4800
MICROFINANCIAL INCORPORATED ANNOUNCES
FIRST QUARTER 2007 RESULTS
Woburn, MA — April 25, 2007 — MicroFinancial Incorporated (AMEX-MFI), a financial intermediary specializing in vendor based leasing and financing programs for microticket transactions, today announced financial results for the first quarter ended March 31, 2007.
Net income for the quarter improved 59% to $1.2 million, or $0.09 per diluted share, compared to net income of $0.8 million, or $0.05 per diluted share, in the first quarter of 2006.
Revenue for the quarter ended March 31, 2007 was $7.5 million compared to $8.9 million in the first quarter of 2006. Income on leases was $2.0 million, up $1.4 million from the same period last year and rental income was $3.9 million, down $1.8 million from March 31, 2006. Other income components contributed $1.6 million for the quarter, down $1.0 million from the same period last year.
Richard Latour, President and Chief Executive Officer said, “I am pleased with the progress we made in the first quarter with respect to our originations. In the first quarter of 2007, new contract originations dramatically improved to $10.1 million compared to $2.9 million in the first quarter of 2006. In addition, we approved 155 new vendors during the quarter, bringing our total vendor list to approximately 1,350. We also processed over 7,700 applications, an increase of over 4,800 applications as compared to the same period last year.”
Total operating expenses for the quarter declined 27.4% to $5.6 million from $7.7 million in the first quarter of 2006. Selling, general and administrative expenses of $3.6 million decreased $0.6 million compared to the same period last year, primarily due to reductions in legal and collection expenses. The first quarter provision for credit losses decreased slightly to $1.5 million from $1.6 million for the same period in 2006, while net charge-offs decreased to $1.9 million versus $2.8 million in the first quarter of 2006. Depreciation and amortization expense of $0.5 million declined 73.8% compared to the same period last year, primarily due to a decline in the number of rental and service contracts combined with a greater percentage of the applicable assets becoming fully depreciated. As a result of lower debt balances, interest expense declined 84.4% to $13,000 as compared to the first quarter of 2006.

 

 

(microfinancial Logo)
Mr. Latour added, “As we look ahead to the rest of 2007, our management team remains focused on increasing originations through rebuilding our vendor base, as well as, looking for new portfolio and additional growth opportunities.”
Although the investment in service and rental contracts continued to decline in the first quarter of 2007, the total investment in lease receivables due in installments, estimated residuals, rentals and service contracts were up $21.5 million to $55.2 million as compared to the same period last year. In the first quarter of 2007, receivables delinquent in excess of 31 days declined $1.7 million to $5.4 million versus year end 2006.
As of March 31, 2007 cash and cash equivalents were $24.0 million. Cash received from customers for the quarter was $9.5 million compared to $12.2 million during the same period in 2006.

 

 

MICROFINANCIAL INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
                 
    December 31,     March 31,  
    2006     2007  
ASSETS
Cash and cash equivalents
   $ 28,737     $ 23,970  
Net investment in leases:
                
Receivables due in installments
     40,455       49,597  
Estimated residual value
     3,859       4,966  
Initial direct costs
     302       386  
Less:
                
Advance lease payments and deposits
     (50 )     (52 )
Unearned income
     (13,682 )     (17,993 )
Allowance for credit losses
     (5,223 )     (4,810 )
 
            
Net investment in leases
     25,661       32,094  
Investment in service contracts, net
     613       481  
Investment in rental contracts, net
     313       168  
Property and equipment, net
     655       653  
Other assets
     652       507  
Deferred income taxes, net
     3,090       3,090  
 
            
Total assets
   $ 59,721     $ 60,963  
 
            
LIABILITIES AND STOCKHOLDERS’ EQUITY
                 
    December 31,     March 31,  
    2006     2007  
Notes payable
   $ 5     $ 24  
Accounts payable
     1,038       511  
Dividends payable
     691       695  
Other liabilities
     1,110       1,420  
Income taxes payable
     741       1,338  
 
            
Total liabilities
     3,585       3,988  
 
            
 
                
Stockholders’ equity:
                
Preferred stock, $.01 par value; 5,000,000 shares authorized;
no shares issued at December 31, 2006 and March 31, 2007
     —       —  
Common stock, $.01 par value; 25,000,000 shares authorized;
13,811,442 and 13,891,596 shares issued at December 31, 2006 and March 31, 2007, respectively
     138       139  
Additional paid-in capital
     44,136       44,452  
Retained earnings
     11,862       12,384  
 
            
Total stockholders’ equity
     56,136       56,975  
 
            
Total liabilities and stockholders’ equity
   $ 59,721     $ 60,963  
 
            

 

 

MICROFINANCIAL INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
                 
    Three Months Ended  
    March 31,  
    2006     2007  
 
                
Revenues:
                
Income on financing leases
   $ 672     $ 2,033  
Rental income
     5,721       3,924  
Income on service contracts
     555       361  
Loss and damage waiver fees
     551       444  
Service fees and other
     1,103       386  
Interest income
     315       323  
 
            
Total revenues
     8,917       7,471  
 
            
 
                
Expenses:
                
Selling general and administrative
     4,207       3,568  
Provision for credit losses
     1,610       1,523  
Depreciation and amortization
     1,765       463  
Interest
     81       13  
 
            
Total expenses
     7,663       5,567  
 
            
 
                
Income before provision for income taxes
     1,254       1,904  
Provision for income taxes
     490       687  
 
            
 
                
Net income
   $ 764     $ 1,217  
 
            
 
                
Net income per common share:
                
Basic
   $ 0.06     $ 0.09  
 
            
Diluted
   $ 0.05     $ 0.09  
 
            
Weighted-average shares:
                
Basic
     13,762,979       13,860,534  
 
            
Diluted
     13,905,902       14,072,449  
 
            
About The Company
MicroFinancial Inc. (AMEX: MFI), is a financial intermediary specializing in microticket leasing and financing. MicroFinancial has been operating since 1986, and is headquartered in Woburn, Massachusetts.
Statements in this release that are not historical facts, including statements about future dividends or growth plans, 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,” “will” and similar expressions are intended to identify forward-looking statements. We caution that a number of important factors could cause our actual results to differ materially from those expressed in any forward-looking statements made by us or on our behalf. Readers should not place undue reliance on forward-looking statements, which reflect

 

 

our views only as of the date hereof. We undertake no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances. We cannot assure that we will be able to anticipate or respond timely to changes which could adversely affect our operating results. Results of operations in any past period should not be considered indicative of results to be expected in future periods. Fluctuations in operating results or other factors may result in fluctuations in the price of our common stock. For a more complete description of the prominent risks and uncertainties inherent in our business, see the risk factors described in documents that we file from time to time with the Securities and Exchange Commission.