EX-99.1 2 a5132463ex99_1.txt EXHIBIT 99.1 Exhibit 99.1 Advanta Has Outstanding First Quarter SPRING HOUSE, Pa.--(BUSINESS WIRE)--April 26, 2006--Advanta Corp. (NASDAQ:ADVNB; ADVNA) today reported first quarter 2006 consolidated net income of $21.9 million or $0.73 per diluted share for Class A and Class B shares combined. Advanta Business Cards earned net income of $21.7 million as compared to $11.2 million for first quarter 2005. Advanta Business Cards ended the quarter with managed receivables at $4.0 billion, growing 20% over the $3.3 billion reported at March 31, 2005. Owned Business Card receivables were $982 million at March 31, 2006, growing 25% over the $784 million reported at March 31, 2005. Transaction volume for the quarter of $2.7 billion exceeded volume for first quarter 2005 by 26%. "We anticipated an outstanding first quarter when we shared our expectations for the full year 2006 last November," said Dennis Alter, Chairman and CEO. "We had high earnings, low losses and delinquencies, and strong growth in new customers and transaction volume. This is a good start to what we believe will be a very good year." Conference Call Details Advanta management will hold a conference call with analysts and institutional investors today, April 26, at 9:00 a.m. Eastern time. The call can be accessed by dialing 719-457-2659 and referring to pass code 8045208. The call will also be webcast simultaneously via a Vcall link on the Company's website, www.advanta.com, or at www.vcall.com. Those interested in listening to the webcast should go to the website at least fifteen minutes before the call to register and download any necessary software. Replays of the call will be available beginning at noon today on the Internet at www.advanta.com or www.vcall.com or by dialing 719-457-0820 and referring to confirmation code 8045208. The conference call may include a discussion of non-GAAP financial measures, which are reconciled to the most directly comparable GAAP financial measure in the press releases or the statistical supplements available at www.advanta.com in the "Corporate Info" section. Advanta focuses on the small business market and related community, providing funding and support to the nation's small businesses and business professionals through innovative products and services. Using its direct marketing and information-based expertise, Advanta identifies potential customers and provides a high level of service tailored to the needs of small businesses. Advanta is one of the nation's largest issuers (through Advanta Bank Corp.) of MasterCard business credit cards to small businesses. Since 1951, Advanta has pioneered many of the marketing techniques common in the financial services industry today, including remote lending, and direct mail, affinity and relationship marketing. Learn more about Advanta at www.advanta.com. This Press Release contains forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Risks that may affect the Company's future performance are detailed in the Company's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. In addition to the GAAP results provided throughout this document, the Company has provided managed receivable data and other non-GAAP financial measurements. Management believes that the non-GAAP financial measures used to manage the business may provide users additional useful information. The tables attached to this press release include a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure and a description of why the non-GAAP financial measures are useful to investors. ADVANTA SEGMENT INCOME STATEMENT (in thousands) Three Months Ended March 31, 2006 ---------------------------------------------------------------------- Advanta Business Cards Other (A) Total --------- --------- --------- Interest income $ 32,810 $ 5,458 $ 38,268 Interest expense 10,024 5,931 15,955 --------- --------- --------- Net interest income 22,786 (473) 22,313 Provision for credit losses 9,334 (50) 9,284 --------- --------- --------- Net interest income after provision for credit losses 13,452 (423) 13,029 Noninterest revenues: Interchange income 44,393 0 44,393 Securitization income 33,578 0 33,578 Servicing revenues 13,682 0 13,682 Business credit card rewards (14,117) 0 (14,117) Other revenues, net 3,802 898 4,700 --------- --------- --------- Total noninterest revenues 81,338 898 82,236 Operating expenses 59,497 142 59,639 --------- --------- --------- Income before income taxes 35,293 333 35,626 Income tax expense 13,588 128 13,716 --------- --------- --------- Net income $ 21,705 $ 205 $ 21,910 ========= ========= ========= Three Months Ended March 31, 2005 ---------------------------------------------------------------------- Advanta Business Cards Other (A) Total --------- --------- --------- Interest income $ 28,866 $ 3,313 $ 32,179 Interest expense 8,521 4,064 12,585 --------- --------- --------- Net interest income 20,345 (751) 19,594 Provision for credit losses 10,419 25 10,444 --------- --------- --------- Net interest income after provision for credit losses 9,926 (776) 9,150 Noninterest revenues: Interchange income 35,696 0 35,696 Securitization income 30,396 0 30,396 Servicing revenues 12,599 0 12,599 Business credit card rewards (10,795) 0 (10,795) Gain on transfer of consumer credit card business 0 67,679 67,679 Other revenues, net 2,969 (57) 2,912 --------- --------- --------- Total noninterest revenues 70,865 67,622 138,487 Operating expenses 62,374 246 62,620 --------- --------- --------- Income before income taxes 18,417 66,600 85,017 Income tax expense 7,183 5,164 12,347 --------- --------- --------- Net income $ 11,234 $ 61,436 $ 72,670 ========= ========= ========= (A) Other includes venture capital operations as well as investment and other activities not attributable to segments. ADVANTA HIGHLIGHTS (in thousands, except per share data) Percent Change Three Months Ended From ---------------------------- Mar. 31, Dec. 31, Mar. 31, Prior Prior EARNINGS 2006 2005 2005 Quarter Year ---------------------------------------------------------------------- Basic income from continuing operations per common share: Class A $ 0.79 $ 0.48 $ 2.82 64.6 % (72.0)% Class B 0.82 0.51 2.85 60.8 (71.2) Combined (A) 0.81 0.50 2.84 62.0 (71.5) Diluted income from continuing operations per common share: Class A 0.73 0.45 2.54 62.2 (71.3) Class B 0.74 0.46 2.55 60.9 (71.0) Combined (A) 0.73 0.46 2.55 58.7 (71.4) Basic net income per common share: Class A 0.79 0.56 2.82 41.1 (72.0) Class B 0.82 0.59 2.85 39.0 (71.2) Combined (A) 0.81 0.58 2.84 39.7 (71.5) Diluted net income per common share: Class A 0.73 0.52 2.54 40.4 (71.3) Class B 0.74 0.53 2.55 39.6 (71.0) Combined (A) 0.73 0.53 2.55 37.7 (71.4) Return on average common equity 16.63 % 12.28 % 67.30 % 35.4 (75.3) COMMON STOCK DATA ---------------------------------------------------------------------- Weighted average common shares used to compute: Basic earnings per common share Class A 8,846 8,837 8,812 0.1 % 0.4 % Class B 18,107 17,992 16,705 0.6 8.4 -------- -------- -------- Total 26,953 26,829 25,517 0.5 5.6 Diluted earnings per common share Class A 8,846 8,837 8,812 0.1 0.4 Class B 20,876 20,535 19,670 1.7 6.1 -------- -------- -------- Total 29,722 29,372 28,482 1.2 4.4 Ending shares outstanding: Class A 9,607 9,607 9,607 0.0 0.0 Class B 18,890 18,756 18,399 0.7 2.7 -------- -------- -------- Total 28,497 28,363 28,006 0.5 1.8 Stock price: Class A High $ 34.74 $ 31.30 $ 22.80 11.0 52.4 Low 28.82 22.62 20.23 27.4 42.5 Closing 34.09 30.13 20.80 13.1 63.9 Class B High 37.44 33.06 24.70 13.2 51.6 Low 30.84 24.76 21.84 24.6 41.2 Closing 36.87 32.44 23.00 13.7 60.3 Cash dividends declared: Class A 0.1134 0.1134 0.0945 0.0 20.0 Class B 0.1361 0.1361 0.1134 0.0 20.0 Book value per common share 19.44 18.74 17.72 3.7 9.7 (A) Combined represents income available to common stockholders divided by the combined total of Class A and Class B weighted average common shares outstanding. ADVANTA BUSINESS CREDIT CARD STATISTICS ($ in thousands) Percent Change Three Months Ended From ------------------------------------ Mar. 31, Dec. 31, Mar. 31, Prior Prior 2006 2005 2005 Quarter Year ---------------------------------------------------- New account originations 82,617 64,206 44,781 28.7 % 84.5 % Average number of active accounts (A) 649,384 621,966 577,301 4.4 12.5 Ending number of accounts 921,841 877,114 786,967 5.1 17.1 Transaction volume $2,733,922 $2,693,908 $2,176,809 1.5 25.6 Securitization volume increase excluding replenishment sales $ 165,000 $ 100,000 $ 0 65.0 N/M Average receivables: Owned $ 929,795 $1,011,684 $ 779,176 (8.1) 19.3 Securitized 2,957,309 2,694,391 2,548,739 9.8 16.0 ---------- ---------- ---------- Managed (B) 3,887,104 3,706,075 3,327,915 4.9 16.8 Ending receivables: Owned $ 982,251 $ 879,468 $ 783,916 11.7 25.3 Securitized 3,045,600 2,880,401 2,565,085 5.7 18.7 ---------- ---------- ---------- Managed (B) 4,027,851 3,759,869 3,349,001 7.1 20.3 ---------------------------------------------------------------------- CREDIT QUALITY - OWNED ------------------ Receivables 30 days or more delinquent $ 26,335 $ 23,595 $ 27,507 Receivables 90 days or more delinquent 11,637 10,837 12,775 As a percentage of gross receivables: Receivables 30 days or more delinquent 2.68 % 2.68 % 3.51 % 0.0 % (23.6)% Receivables 90 days or more delinquent 1.18 1.23 1.63 (4.1) (27.6) Net principal charge-offs: Amount $ 8,084 $ 15,768 $ 10,419 As a percentage of average gross receivables (annualized) 3.48 % 6.23 % 5.35 % (44.1) (35.0) CREDIT QUALITY - SECURITIZED ------------------ Receivables 30 days or more delinquent $ 91,029 $ 87,610 $ 110,069 Receivables 90 days or more delinquent 40,131 40,223 51,318 As a percentage of gross receivables: Receivables 30 days or more delinquent 2.99 % 3.04 % 4.29 % (1.6)% (30.3)% Receivables 90 days or more delinquent 1.32 1.40 2.00 (5.7) (34.0) Net principal charge-offs: Amount $ 27,095 $ 46,151 $ 35,270 As a percentage of average gross receivables (annualized) 3.66 % 6.85 % 5.54 % (46.6) (33.9) CREDIT QUALITY - MANAGED (B) ------------------ Receivables 30 days or more delinquent $ 117,364 $ 111,205 $ 137,576 Receivables 90 days or more delinquent 51,768 51,060 64,093 As a percentage of gross receivables: Receivables 30 days or more delinquent 2.91 % 2.96 % 4.11 % (1.7)% (29.2)% Receivables 90 days or more delinquent 1.29 1.36 1.91 (5.1) (32.5) Net principal charge-offs: Amount $ 35,179 $ 61,919 $ 45,689 As a percentage of average gross receivables (annualized) 3.62 % 6.68 % 5.49 % (45.8) (34.1) (A) Active accounts are defined as accounts with a balance at month- end. Active account statistics do not include charged-off accounts. The statistics reported above are the average number of active accounts for the periods presented. (B) Managed statistics are non-GAAP financial measures and represent the sum of owned (GAAP) business credit card statistics and securitized business credit card statistics. We believe that performance on a managed basis provides useful supplemental information to investors because we retain interests in the securitized receivables and, therefore, we have a financial interest in and exposure to the performance of the securitized receivables. N/M - Not Meaningful - Statistical supplement available at www.advanta.com - CONTACT: Advanta Corp. Amy B. Holderer Vice President, Investor Relations 215-444-5335 aholderer@advanta.com or David M. Goodman Director, Communications 215-444-5073 dgoodman@advanta.com