EX-99.1 2 a08-8344_1ex99d1.htm EX-99.1

Exhibit 99.1

 

N E W S  R E L E A S E

 

Contact:

 

Suzy W. Taylor

 

 

866-652-1810

 

 

FirstCity Financial Reports Fourth Quarter and Full Year 2007 Results

 

Waco, Texas   March 17, 2008……….

 

Highlights:

 

·      FirstCity reported 4th quarter 2007 loss of $1.4 million or ($.12) per diluted share. Earnings for the year 2007 were $2,185,000 or $0.19 per diluted share.

 

·      FirstCity’s total investment level nears $150.0 million for 2007.

 

·      FirstCity liquidity is solid with additional borrowing capacity of $146 million.

 

Components of the quarterly results are detailed below (dollars in thousands except per share data):

 

 

 

Three Months Ended

 

Year Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

(unaudited)

 

(unaudited)

 

Portfolio Asset Acquisition and Resolution

 

$

569

 

$

3,009

 

$

11,432

 

$

15,104

 

Corporate overhead *

 

(1,929

)

(1,459

)

(9,247

)

(5,227

)

Earnings (loss) from continuing operations

 

(1,360

)

1,550

 

2,185

 

9,877

 

Loss from discontinued operations, net of taxes

 

—

 

—

 

—

 

(75

)

Net earnings (loss) to common stockholders

 

$

(1,360

)

$

1,550

 

$

2,185

 

$

9,802

 

Diluted earnings (loss) per common share

 

$

(0.12

)

$

0.13

 

$

0.19

 

$

0.83

 

 

*      Corporate overhead includes expenses related to the independent audit committee investigation of $2.2 million in 2007 – comprised of $1.2 million in the first quarter, $0.8 million in the second quarter and $0.2 million in the third quarter. The independent investigation concluded in 2007.

 

James T. Sartain, President and CEO of FirstCity, said, “While we are disappointed in our 2007 results, FirstCity is well positioned to take advantage of the growing investment opportunities we are seeing in the marketplace. We have liquidity, a well-rounded franchise and talented, seasoned asset managers to create significant value for FirstCity. These are the times we look for, where the growing supply of distressed assets translates into attractive margins. I am enthusiastic about the opportunities I see in 2008.”

 

Portfolio Asset Acquisition and Resolution

 

The Company invested $19.4 million in portfolio acquisitions and other investments during the quarter. Earning assets totaled $243.6 million at quarter end.

 

(more)

 


 

Portfolio purchases are detailed below (in millions):

 

 

 

Portfolio Purchases

 

FirstCity

 

 

 

 

 

 

 

 

 

Latin

 

 

 

FirstCity

 

Investment

 

 

 

 

 

Domestic

 

Europe

 

America

 

Total

 

Investment

 

in Other

 

Total

 

2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4th Quarter

 

$

5.3

 

$

14.7

 

$

4.4

 

$

24.4

 

$

15.7

 

$

3.7

 

$

19.4

 

3rd Quarter

 

17.4

 

2.3

 

—

 

19.7

 

16.3

 

6.3

 

22.6

 

2nd Quarter

 

27.4

 

2.4

 

61.6

 

91.4

 

25.2

 

4.2

 

29.4

 

1st Quarter

 

71.6

 

3.8

 

3.4

 

78.8

 

69.5

 

7.8

 

77.3

 

YTD 2007

 

$

121.7

 

$

23.2

 

$

69.4

 

$

214.3

 

$

126.7

 

$

22.0

 

$

148.7

 

2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4th Quarter

 

$

34.6

 

$

101.2

 

$

2.1

 

$

137.9

 

$

70.2

 

$

16.8

 

$

87.0

 

3rd Quarter

 

35.4

 

—

 

56.1

 

91.5

 

31.5

 

3.7

 

35.2

 

2nd Quarter

 

24.2

 

1.0

 

—

 

25.2

 

19.0

 

7.0

 

26.0

 

1st Quarter

 

42.4

 

—

 

—

 

42.4

 

23.3

 

0.7

 

24.0

 

Total Year 2006

 

$

136.6

 

$

102.2

 

$

58.2

 

$

297.0

 

$

144.0

 

$

28.2

 

$

172.2

 

Total Year 2005

 

$

93.4

 

$

37.2

 

$

16.0

 

$

146.6

 

$

71.4

 

$

3.2

 

$

74.6

 

Total Year 2004

 

$

91.2

 

$

9.8

 

$

73.1

 

$

174.1

 

$

59.8

 

$

—

 

$

59.8

 

 

For the fourth quarter 2007, operating contribution from the Portfolio Asset Acquisition business was $0.6 million. The earnings were comprised primarily of $10.9 million in revenues, $2.6 million in equity in earnings of investments, and $13.0 million of expenses. The business generated 56% of the revenues (including equity in earnings of investments) from domestic investments, 26% from investments in Latin America, 18% from investments in Europe and less than 1% from investments in Canada.

 

The revenues for the fourth quarter were positively impacted by continued income streams from Portfolio Assets of $6.3 million, equity in earnings of investments of $2.6 million, servicing fees of $2.4 million, and interest income from loans receivable of $0.9 million.

 

Fourth quarter earnings were negatively impacted by $3.2 million of net provisions – comprised of $1.1 million of provisions recorded to our wholly-owned domestic portfolios, and $2.1 million  recorded to portfolio assets held in our partnerships ($1.6 million of net provisions in domestic partnerships and $0.5 million in Latin American partnerships). For the full year, net provisions were $6.4 million – comprised of $2.1 million recorded to our wholly-owned portfolios and $4.3 million to portfolio assets held in our partnerships. The fourth quarter provisions reflected delays and declines in the expected cash flows of certain loan portfolios and real estate assets. Management regularly evaluates the collectibility of the Company’s portfolio assets and may increase or decrease those values in future periods as the cash flows expected from those assets change.

 

Considering the recent deterioration of credit quality experienced by many banks, management believes that acquisition opportunities at attractive margins are on the rise. FirstCity’s total investment level approximated $150.0 million in 2007, and the Company is currently evaluating 27 different transactions representing over $1.8 billion in face value of assets, although there can be no assurance that FirstCity will be able to consummate any of these transactions on acceptable terms.

 

2


 

The following tables detail the impact of net foreign currency gains (losses) on corporate earnings:

 

 

 

Three Months Ended

 

Year Ended

 

Illustration of the Effects of Currency

 

December 31,

 

December 31,

 

Fluctuations (dollars in thousands)

 

2007

 

2006

 

2007

 

2006

 

 

 

(unaudited)

 

(unaudited)

 

Net earnings (loss) to Common Stockholders

 

$

(1,360

)

$

1,550

 

$

2,185

 

$

9,802

 

Foreign currency gains (losses):

 

 

 

 

 

 

 

 

 

Euro

 

97

 

287

 

882

 

1,068

 

Mexican Peso

 

127

 

(274

)

(63

)

(585

)

Argentine Peso

 

(14

)

29

 

(38

)

(30

)

Canadian Dollar

 

4

 

(106

)

247

 

(112

)

Chilean Peso

 

32

 

—

 

60

 

—

 

 

 

 

 

 

 

 

 

 

 

Exchange rate at valuation date:

 

 

 

 

 

 

 

 

 

Euro

 

0.68

 

0.76

 

 

 

 

 

Mexican Peso

 

10.87

 

10.88

 

 

 

 

 

Argentine Peso

 

3.15

 

3.07

 

 

 

 

 

Canadian Dollar

 

0.98

 

1.17

 

 

 

 

 

Chilean Peso

 

497.70

 

532.6

 

 

 

 

 

 

Other Corporate Matters

 

Share Repurchase Program

 

FirstCity initiated a stock repurchase program in 2006 providing for the repurchase of up to 1,000,000 shares of its common stock. Recently, the program was increased by 500,000 shares. To date, the Company has purchased 845,030 shares at an average cost of $9.60 per share (including 40,400 shares repurchased during the fourth quarter of 2007 and 264,530 shares repurchased since
year-end). Share repurchases continue and signify management’s assessment that the shares are undervalued in the market and represent a good investment alternative to enhance long term shareholder value.

 

Liquidity

 

FirstCity’s ability to obtain financing for investment opportunities is strong and remains unhindered by the negative conditions witnessed recently in the financial services sector, as evidenced by FirstCity’s ability to secure $125.0 million of total increases in its Bank of Scotland credit facilities during 2007. Management believes that the prospects for continued growth are strong based on existing acquisition opportunities and the stability of the Company’s credit providers and availability under its lines of credit.

 

3


 

Conference Call

 

A conference call will be held on Monday, March 17, 2008 at 9:00 a.m. Central Time to discuss fourth quarter and fiscal year 2007 results. A question and answer session will follow the prepared remarks. Details to access the call and webcast are as follows:

 

Event:

 

FirstCity Financial Corporation Fourth Quarter 2007 Conference Call

Date:

 

Monday, March 17, 2008

Time:

 

9:00 a.m. Central Time

Host:

 

James T. Sartain, FirstCity’s President and Chief Executive Officer

 

 

 

 

 

 

Web Access:

 

FirstCity’s web page-

 

www.fcfc.com/invest.htm or,

 

 

CCBN’s Investor websites-

 

www.streetevents.com and,

 

 

 

 

www.fulldisclosure.com

 

Dial In Access:

 

Domestic

 

800-329-9097

 

 

International

 

617-614-4929

 

 

 

 

 

 

 

Pass code

 

63177991

 

 

 

 

 

Replay

 

Available on FirstCity’s web page (www.fcfc.com/invest.htm)

 

Forward Looking Statements

 

Certain statements in this press release, which are not historical in fact, including, but not limited to, statements relating to future performance, may be deemed to be forward-looking statements under the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, without limitation, statements based on management’s expectations and statements regarding revenues, earnings guidance and future projected cash collections, as well as any  statement that may project, indicate or imply future results, performance or achievements, and may contain the words “expect,” “intend,” “plan,” “estimate,” “believe,” “will be,” “will continue,” “will likely result,” “indication” and similar expressions. Such statements inherently are subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. There are many important factors that could cause the Company’s actual results to differ materially.

 

These factors include, but are not limited to, the performance of the Company’s subsidiaries and affiliates; availability of portfolio assets and other investment opportunities; the Company’s ability to consummate portfolio acquisitions ad other investment transactions on acceptable terms; assumptions underlying portfolio asset performance; risks associated with start up of new businesses and entry into new foreign markets, risks associated with foreign operations; currency exchange rate fluctuations; interest rate risk; credit risk; risks of declining value of loans, collateral or assets; the degree to which the Company is leveraged; the Company’s continued need for financing; availability of the Company’s credit facilities; ability to obtain additional financing from the Bank of Scotland or any other lender; the impact of certain covenants in loan agreements of the Company and its subsidiaries; the ability of the Company to utilize net operating loss carry forwards; general economic, business and market conditions; foreign social and economic conditions; changes (legislative and otherwise) in the asset securitization industry; regulatory and accounting changes; fluctuation in residential and commercial real estate values; capital markets conditions, including  the markets for asset-backed securities; uncertainties of any litigation arising from discontinued operations; factors more fully discussed and identified under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations;” and risk factors and other risks identified in the Company’s Annual Report on Form 10-K for the year ended December 31, 2007, filed with the SEC on March 17, 2008, as well as in the Company’s other filings with the SEC.

 

Many of these factors are beyond the Company’s control. In addition, it should be noted that past financial and operational performance of the Company is not necessarily indicative of future financial and operational performance. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements.

 

The forward-looking statements in this release speak only as of the date of this release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based.

 

The Company is a diversified financial services company with operations dedicated to portfolio asset acquisition and resolution with offices in the U.S. and with affiliate organizations in Europe and Latin America. Its common stock is listed on the NASDAQ Global Select Market under the symbol “FCFC.”

 

4


 

FirstCity Financial Corporation

Summary of Operations

(In thousands, except per share data)

(Unaudited)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

Revenues:

 

 

 

 

 

 

 

 

 

Servicing fees

 

$

2,382

 

$

2,724

 

$

10,390

 

$

12,906

 

Income from Portfolio Assets

 

6,291

 

3,436

 

22,754

 

10,987

 

Gain on sale of SBA loans held for sale, net

 

65

 

—

 

723

 

—

 

Interest income from SBA loans

 

474

 

—

 

2,140

 

—

 

Interest income from affiliates

 

147

 

309

 

560

 

1,498

 

Interest income from loans receivable - other

 

306

 

559

 

3,822

 

576

 

Other income

 

1,367

 

574

 

3,267

 

2,420

 

Total revenues

 

11,032

 

7,602

 

43,656

 

28,387

 

Expenses:

 

 

 

 

 

 

 

 

 

Interest and fees on notes payable - other

 

4,394

 

2,856

 

18,060

 

8,289

 

Interest and fees on notes payable to affiliates

 

—

 

—

 

—

 

22

 

Salaries and benefits

 

4,629

 

3,721

 

16,932

 

14,831

 

Provision (recovery) for loan and impairment losses

 

1,125

 

170

 

2,061

 

271

 

Occupancy, data processing, property protection and other

 

4,249

 

3,043

 

14,789

 

9,236

 

Total expenses

 

14,397

 

9,790

 

51,842

 

32,649

 

Equity in earnings of investments

 

2,629

 

3,712

 

10,944

 

11,756

 

Gain on sale of subsidiaries and equity investments

 

—

 

54

 

207

 

2,459

 

Earnings (loss) from continuing operations before income taxes and minority interest

 

(736

)

1,578

 

2,965

 

9,953

 

Income taxes

 

(415

)

(61

)

(781

)

(173

)

Minority interest

 

(209

)

33

 

1

 

97

 

Earnings (loss) from continuing operations

 

(1,360

)

1,550

 

2,185

 

9,877

 

Discontinued operations

 

 

 

 

 

 

 

 

 

Loss from operations of discontinued components

 

—

 

—

 

—

 

(75

)

Income taxes

 

—

 

—

 

—

 

—

 

Loss from discontinued operations

 

—

 

—

 

—

 

(75

)

Net earnings

 

$

(1,360

)

$

1,550

 

$

2,185

 

$

9,802

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share are as follows:

 

 

 

 

 

 

 

 

 

Earnings (loss) from continuing operations

 

$

(0.14

)

$

0.14

 

$

0.20

 

$

0.89

 

Discontinued operations

 

$

—

 

$

—

 

$

—

 

$

(0.01

)

Net earnings (loss) per common share

 

$

(0.14

)

$

0.14

 

$

0.20

 

$

0.88

 

Wtd. avg. common shares outstanding

 

10,778

 

10,787

 

10,786

 

11,125

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share are as follows:

 

 

 

 

 

 

 

 

 

Earnings (loss) from continuing operations

 

$

(0.12

)

$

0.13

 

$

0.19

 

$

0.84

 

Discontinued operations

 

$

—

 

$

—

 

$

—

 

$

(0.01

)

Net earnings (loss) per common share

 

$

(0.12

)

$

0.13

 

$

0.19

 

$

0.83

 

Wtd. avg. common shares outstanding

 

11,362

 

11,415

 

11,392

 

11,759

 

 

 

 

 

 

Selected Unaudited Balance Sheet Data

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

 

 

2007

 

2006

 

 

 

 

 

 

Cash

 

$

23,546

 

$

18,472

 

 

 

 

 

 

Earning Assets:

 

 

 

 

 

 

 

 

 

 

Portfolio Assets, net

 

122,001

 

108,696

 

 

 

 

 

 

Loans and interest receivable

 

26,574

 

29,311

 

 

 

 

 

 

Equity investments

 

87,622

 

112,357

 

 

 

 

 

 

Railroad assets

 

7,403

 

—

 

 

 

 

 

 

Deferred tax asset, net

 

20,101

 

20,101

 

 

 

 

 

 

Service fees receivable and other assets

 

10,872

 

8,726

 

 

 

 

 

 

Total assets

 

$

298,119

 

$

297,663

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes payable - other

 

$

177,329

 

$

187,811

 

 

 

 

 

 

Minority interest and other liabilities

 

13,967

 

5,959

 

 

 

 

 

 

Total liabilities

 

191,296

 

193,770

 

 

 

 

 

 

Total equity

 

106,823

 

103,893

 

 

 

 

 

 

Total liabilities and equity

 

$

298,119

 

$

297,663

 

 

 

 

 

 

 

5


 

FirstCity Financial Corporation

Supplemental Information

(Dollars in thousands)

(Unaudited)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

Portfolio Asset Acquisition and Resolution:

 

 

 

 

 

 

 

 

 

Summary Operating Statement Data

 

 

 

 

 

 

 

 

 

Revenues

 

$

10,945

 

$

7,470

 

$

43,217

 

$

27,522

 

Equity in earnings of investments

 

2,629

 

3,712

 

10,944

 

11,756

 

Gain on sale of subsidiaries and equity investments

 

—

 

54

 

207

 

2,459

 

Expenses

 

(11,880

)

(8,057

)

(40,875

)

(26,362

)

Operating contribution before provision for loan and impairment losses

 

1,694

 

3,179

 

13,493

 

15,375

 

Provision for loan and impairment losses

 

1,125

 

170

 

2,061

 

271

 

Operating contribution, net of direct taxes

 

$

569

 

$

3,009

 

$

11,432

 

$

15,104

 

 

 

 

 

 

 

 

 

 

 

Aggregate purchase price of portfolios acquired:

 

 

 

 

 

 

 

 

 

Acquisition partnerships

 

 

 

 

 

 

 

 

 

Domestic

 

$

5,309

 

$

34,653

 

$

121,679

 

$

136,596

 

Latin America

 

4,496

 

2,132

 

69,455

 

58,236

 

Europe

 

14,661

 

101,132

 

23,199

 

102,158

 

Total

 

$

24,466

 

$

137,917

 

$

214,333

 

$

296,990

 

 

 

 

Purchase

 

FirstCity’s

 

 

 

 

 

 

 

 

Price

 

Investment

 

 

 

 

 

 

Historical Acquisitions - Annual:

 

 

 

 

 

 

 

 

 

 

2007

 

$

214,333

 

$

126,714

 

 

 

 

 

 

2006

 

296,990

 

144,048

 

 

 

 

 

 

2005

 

146,581

 

71,405

 

 

 

 

 

 

2004

 

174,139

 

59,762

 

 

 

 

 

 

2003

 

129,192

 

22,944

 

 

 

 

 

 

 

 

 

December 31,

 

December 31,

 

 

 

 

 

 

 

 

2007

 

2006

 

 

 

 

 

 

Portfolio acquisition and resolution assets by region:

 

 

 

 

 

 

 

 

 

 

Domestic

 

$

163,078

 

$

158,147

 

 

 

 

 

 

Latin America

 

33,450

 

28,883

 

 

 

 

 

 

Europe

 

46,701

 

61,062

 

 

 

 

 

 

Canada

 

371

 

2,272

 

 

 

 

 

 

Total

 

$

243,600

 

$

250,364

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Year Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

Revenues and equity in earnings of investments by region:

 

 

 

 

 

 

 

 

 

Domestic

 

$

7,632

 

$

5,719

 

$

33,850

 

$

22,063

 

Latin America

 

3,540

 

3,289

 

12,068

 

11,191

 

Europe

 

2,388

 

2,080

 

8,055

 

5,913

 

Canada

 

14

 

94

 

188

 

111

 

Total

 

$

13,574

 

$

11,182

 

$

54,161

 

$

39,278

 

 

 

 

 

 

 

 

 

 

 

Revenues and equity in earnings of investments by source:

 

 

 

 

 

 

 

 

 

Equity earnings

 

$

2,629

 

$

3,712

 

$

10,944

 

$

11,756

 

Income from Portfolio Assets

 

6,291

 

3,436

 

22,754

 

10,987

 

Servicing fees

 

2,382

 

2,724

 

10,390

 

12,906

 

Gain on sale of SBA loans held for sale, net

 

65

 

—

 

723

 

—

 

Interest income from SBA loans

 

474

 

—

 

2,140

 

—

 

Interest income from affiliates

 

147

 

309

 

560

 

1,498

 

Interest income from loans receivable - other

 

306

 

559

 

3,822

 

576

 

Other

 

1,280

 

442

 

2,828

 

1,555

 

Total

 

$

13,574

 

$

11,182

 

$

54,161

 

$

39,278

 

 

6


 

FirstCity Financial Corporation

Supplemental Information

(Dollars in thousands)

(Unaudited)

 

 

 

Three Months Ended

 

Year Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

Analysis of Equity Investments

 

 

 

 

 

 

 

 

 

FirstCity’s average investment

 

 

 

 

 

 

 

 

 

Domestic

 

$

29,693

 

$

38,697

 

$

33,573

 

$

45,479

 

Latin America

 

21,827

 

19,148

 

20,960

 

10,897

 

Europe

 

29,025

 

30,801

 

40,405

 

22,774

 

Europe-Servicing subsidiaries

 

6,465

 

5,738

 

6,018

 

5,594

 

Latin America-Servicing subsidiaries

 

4,453

 

282

 

3,588

 

233

 

Total

 

$

91,463

 

$

94,666

 

$

104,544

 

$

84,977

 

 

 

 

 

 

 

 

 

 

 

FirstCity share of equity earnings:

 

 

 

 

 

 

 

 

 

Domestic

 

$

(144

)

$

1,366

 

$

2,284

 

$

6,502

 

Latin America

 

495

 

127

 

1,310

 

(189

)

Europe

 

1,653

 

1,623

 

5,948

 

4,614

 

Europe-Servicing subsidiaries

 

421

 

317

 

1,152

 

750

 

Latin America-Servicing subsidiaries

 

204

 

279

 

250

 

79

 

Total

 

$

2,629

 

$

3,712

 

$

10,944

 

$

11,756

 

 

 

 

 

 

 

 

 

 

 

Selected Other Data:

 

 

 

 

 

 

 

 

 

Average investment in wholly owned portfolio assets and loans receivable:

 

 

 

 

 

 

 

 

 

Domestic

 

$

139,469

 

$

95,629

 

$

147,545

 

$

66,381

 

Latin America

 

6,714

 

8,962

 

7,952

 

12,479

 

Europe

 

5,628

 

3,500

 

4,431

 

2,475

 

Canada

 

369

 

2,286

 

1,255

 

703

 

Total

 

$

152,180

 

$

110,377

 

$

161,183

 

$

82,038

 

 

 

 

 

 

 

 

 

 

 

Income from wholly owned portfolio assets and loans receivable:

 

 

 

 

 

 

 

 

 

Domestic

 

$

6,686

 

$

3,595

 

$

27,452

 

$

11,392

 

Latin America

 

479

 

543

 

1,990

 

1,377

 

Europe

 

104

 

72

 

369

 

181

 

Canada

 

14

 

94

 

188

 

111

 

Total

 

$

7,283

 

$

4,304

 

$

29,999

 

$

13,061

 

 

 

 

 

 

 

 

 

 

 

Servicing fee revenues:

 

 

 

 

 

 

 

 

 

Domestic partnerships:

 

 

 

 

 

 

 

 

 

Servicing fee revenue

 

$

316

 

$

600

 

$

2,429

 

$

3,398

 

Average servicing fee %

 

3.4

%

3.1

%

3.7

% 

3.0

%

Latin American partnerships:

 

 

 

 

 

 

 

 

 

Servicing fee revenue

 

$

2,041

 

$

2,044

 

$

7,782

 

$

7,287

 

Average servicing fee %

 

14.5

%

12.8

%

13.6

%

9.9

%

Incentive service fees

 

$

—

 

$

80

 

$

—

 

$

2,221

 

Total Service Fees-Portfolio Assets:

 

 

 

 

 

 

 

 

 

Servicing fee revenue

 

$

2,357

 

$

2,724

 

$

10,211

 

$

12,906

 

Average servicing fee %

 

10.0

% 

7.7

%

8.3

%

6.9

%

Service Fees-SBA loans:

 

$

25

 

$

—

 

$

179

 

$

—

 

Total Service Fees

 

$

2,382

 

$

2,724

 

$

10,390

 

$

12,906

 

 

 

 

 

 

 

 

 

 

 

Collections:

 

 

 

 

 

 

 

 

 

Domestic

 

$

9,389

 

$

19,241

 

$

66,063

 

$

114,248

 

Latin America

 

14,090

 

16,003

 

57,283

 

73,781

 

Europe

 

21,329

 

12,184

 

91,422

 

52,348

 

Subtotal

 

44,808

 

47,428

 

214,768

 

240,377

 

Wholly-owned

 

25,071

 

17,146

 

85,888

 

48,116

 

Total

 

$

69,879

 

$

64,574

 

$

300,656

 

$

288,493

 

 

 

 

 

 

 

 

 

 

 

Servicing portfolio (face value):

 

 

 

 

 

 

 

 

 

Domestic

 

$

564,828

 

$

552,925

 

 

 

 

 

Latin America

 

1,053,299

 

1,694,649

 

 

 

 

 

Europe

 

1,125,168

 

1,062,886

 

 

 

 

 

Total

 

$

2,743,295

 

$

3,310,460

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of personnel at period end:

 

 

 

 

 

 

 

 

 

Domestic

 

88

 

57

 

 

 

 

 

Latin America

 

118

 

119

 

 

 

 

 

Corporate

 

35

 

32

 

 

 

 

 

Total personnel

 

241

 

208

 

 

 

 

 

 

7


 

FirstCity Financial Corporation

Schedule of Unrealized Gross Profit

As of December 31, 2007

(Unaudited)

 

 

 

Book Value of Portfolio Assets (1)

 

($ in 000’s)

 

12/31/2005

 

12/31/2006

 

12/31/2007

 

Domestic

 

$

115,081

 

161,670

 

151,802

 

Europe

 

19,112

 

46,204

 

40,340

 

Latin America

 

18,949

 

13,826

 

26,844

 

Total

 

$

153,141

 

221,700

 

218,987

 

 

 

 

Estimated Remaining Collections (2)

 

 

 

12/31/2005

 

12/31/2006

 

12/31/2007

 

Domestic

 

$

170,153

 

215,987

 

195,845

 

Europe

 

28,185

 

61,081

 

52,617

 

Latin America

 

34,556

 

50,866

 

68,900

 

Total

 

$

232,895

 

327,934

 

317,363

 

 

 

 

Unrealized Gross Profit (3)

 

 

 

12/31/2005

 

12/31/2006

 

12/31/2007

 

Domestic

 

$

55,073

 

54,317

 

44,043

 

Europe

 

9,073

 

14,877

 

12,278

 

Latin America

 

15,608

 

37,040

 

42,056

 

Total

 

$

79,754

 

106,234

 

98,376

 

 

 

 

Gross Profit%

 

 

 

12/31/2005

 

12/31/2006

 

12/31/2007

 

Domestic

 

32.4

%

29.1

%

22.5

%

Europe

 

32.2

%

24.4

%

23.3

%

Latin America

 

45.2

%

56.0

%

61.0

%

Total

 

34.2

%

32.4

%

31.0

%

 

 

This schedule represents statistical information related to the Company’s ownership in portfolio assets and is provided for informational purposes to give an indication of the future Unrealized Gross Profit attributable to those pools. These are estimates and will change each period based upon review and judgment of management and individual facts and circumstances surrounding each asset in the portfolios.

 

(1) Book Value of Portfolio Assets represents FirstCity’s share of the unamortized purchase price of the portfolios held by the various acquisition entities that hold the portfolio some of which are consolidated and some are held through equity investments in partnership or similar arrangements.

(2) Estimated Remaining Collections represents the sum of all future projected cash collections expected from the owned portfolios net of certain expenses.

(3) Unrealized Gross Profit represents the excess difference between the Estimated Remaining Collections and the Book Value of Portfolio Assets.

 

8