8-K

UNITED STATES

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 17, 2013

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)

16 New England Executive Park, Suite 200, Burlington MA 01803

(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)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On April 17, 2013, the Registrant announced its results of operations for its first quarter ended March 31, 2013. Pursuant to Form 8-K, General Instruction F, the Registrant hereby incorporates by reference the press release attached hereto as Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits.

Exhibit	Exhibit Title
Exhibit 99.1	Press Release dated April 17, 2013

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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 R. Jackson, Jr.
	James R. Jackson, Jr.
	Vice President and Chief Financial Officer

Dated: April 18, 2013

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EX-99.1

Exhibit 99.1

April 17, 2013	Contact:
4:01 pm	Dave Mossberg
	Three Part Advisors, LLC
	Tel: 817-310-0051

MICROFINANCIAL INCORPORATED ANNOUNCES

FIRST QUARTER 2013 RESULTS

Burlington, MA — April 17, 2013 — MicroFinancial Incorporated (NASDAQ:MFI) a financial intermediary specializing in vendor based leasing and finance programs for microticket transactions, today announced financial results for the first quarter ended March 31, 2013.

Quarterly Highlights:

• Net income increased by 12.7% to $2.3 million or $0.15 per diluted share on 14,786,580 shares;

• Increased cash received from customers by 6.6% to $31.0 million, representing $2.10 per diluted share as compared to the first quarter of 2012;

• Increased total revenues by 7.4% to $15.3 million as compared to the same period last year;

• Contract originations were $20.1 million, down from $21.6 million for the same period in 2012;

• Reduced net charge-offs by 20.1% to $4.2 million as compared to the same period last year; and

• Paid a quarterly dividend of $0.9 million during the first quarter, representing $0.06 per share.

First Quarter Results:

Net income for the first quarter of 2013 was $2.3 million, or $0.15 per diluted share on 14,786,580 shares as compared to $2.0 million or $0.14 per diluted share based upon 14,600,775 shares for the same period last year.

Revenue for the quarter ended March 31, 2013 increased 7.4% to $15.3 million compared to $14.2 million in the first quarter of 2012 due primarily to increases in leasing revenues associated with our new lease originations and an increase in rental income. Income on leases was $10.2 million, an increase of $0.6 million from the same period last year, and rental income was $2.5 million, an increase of $0.2 million from the same period last year. Other revenue components contributed $2.6 million, an increase of $0.3 million from the same period last year.

Total operating expenses for the quarter increased 5.8% to $11.5 million from $10.9 million in the first quarter of 2012. Selling, general and administrative expenses increased $0.3 million to $4.7 million from $4.4 million for the same period last year primarily due to increases in

personnel related expenses. The first quarter 2013 provision for credit losses remained flat at $4.9 million. First quarter 2013 net charge-offs decreased to $4.2 million from $5.2 million in the comparable period of 2012 while recoveries increased slightly to $1.4 million from $1.3 million for the same period in 2012. Depreciation and amortization expense for the first quarter of 2013 increased $0.3 million to $1.3 million as compared to the first quarter of 2012 due primarily to an increase in the number of TimePayment contracts coming to maturity and converting to rentals as well as an increase in the number of service contracts.

Cash received from customers increased 6.6% to $31.0 million during the first quarter of 2013. New originations for the quarter decreased 7.2% to $20.1 million as compared to $21.6 million in the first quarter of 2012. Headcount at March 31, 2013 was 151 as compared to 141 for the same period last year.

Richard Latour, President and Chief Executive Officer said, “We are pleased with our overall financial performance for the quarter. Despite the decline in origination dollars year over year, we realized a 7.8% increase in the number of applications and a 9.0% increase in the number of contracts originated. The decrease in origination dollars resulted from a decline in the average funded amount from approximately $5,400 in the first quarter of 2012 to $4,600 in the first quarter of 2013. Total revenues increased by 7.4% and net income improved 12.7% from the first quarter of 2012. Net charge-offs declined by $1.0 million and cash received from customers increased by $1.9 million as compared to the first quarter of 2012. We approved 255 new dealers during the quarter. In addition, we realized a 10.9% after tax return on average equity and a 5.4% after tax return on average assets.”

MICROFINANCIAL INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

	(Unaudited) March 31, 2013			December 31, 2012
ASSETS
Cash and cash equivalents	$	2,959		$	3,557
Restricted cash		475			1,213
Net investment in leases:
Receivables due in installments		212,526			213,466
Estimated residual value		23,829			24,176
Initial direct costs		1,730			1,751
Less:
Advance lease payments and deposits		(3,146	)		(3,278	)
Unearned income		(60,937	)		(62,244	)
Allowance for credit losses		(14,747	)		(14,038	)
Net investment in leases		159,255			159,833
Investment in service contracts, net		1,179			797
Investment in rental contracts, net		1,120			1,037
Property and equipment, net		1,619			1,534
Other assets		1,541			1,658
Total assets	$	168,148		$	169,629
LIABILITIES AND STOCKHOLDERS’ EQUITY
	March 31, 2013			December 31, 2012
Revolving line of credit	$	69,254		$	70,380
Accounts payable		2,377			3,220
Dividends payable		39			40
Other liabilities		2,624			2,545
Income taxes payable		1,015			653
Deferred income taxes		8,889			10,399
Total liabilities		84,198			87,237
Stockholders’ equity:
Preferred stock, $.01 par value; 5,000,000 shares authorized; no shares issued at March 31, 2013 and December 31, 2012		—			—
Common stock, $.01 par value; 25,000,000 shares authorized; 14,501,080 and 14,470,219 shares issued at March 31, 2013 and December 31, 2012, respectively		145			145
Additional paid-in capital		47,670			47,500
Retained earnings		36,135			34,747
Total stockholders’ equity		83,950			82,392
Total liabilities and stockholders’ equity	$	168,148		$	169,629

MICROFINANCIAL INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(Unaudited)

	Three Months Ended March 31,
	2013		2012
Revenues:
Income on financing leases	$	10,204	$	9,635
Rental income		2,503		2,317
Income on service contracts		176		85
Loss and damage waiver fees		1,441		1,287
Service fees and other		971		920
Total revenues		15,295		14,244
Expenses:
Selling general and administrative		4,662		4,356
Provision for credit losses		4,881		4,896
Depreciation and amortization		1,305		1,008
Interest		670		633
Total expenses		11,518		10,893
Income before provision for income taxes		3,777		3,351
Provision for income taxes		1,511		1,340
Net income	$	2,266	$	2,011
Net income per common share:
Basic	$	0.16	$	0.14
Diluted	$	0.15	$	0.14
Weighted-average shares:
Basic		14,495,411		14,284,087
Diluted		14,786,580		14,600,775

About The Company

MicroFinancial Inc. (NASDAQ:MFI), headquartered in Burlington, MA, is a financial intermediary specializing in microticket leasing and financing. We have been in operation since 1986.

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.