CRIIMI MAE Reports Third Quarter 1999 Results
ROCKVILLE, Md., Nov. 15 /PRNewswire/ -- CRIIMI MAE Inc. (NYSE: CMM), the
commercial mortgage company that filed a voluntary petition to reorganize
under Chapter 11 of the U.S. Bankruptcy Code on October 5, 1998, today
reported results for the three and nine months ended September 30, 1999.
Under generally accepted accounting principles (GAAP), net income
available to common shareholders for the three months ended September 30, 1999
was $8.1 million. This compares to a net loss for last year's third quarter
of approximately $8.7 million. On a per share basis, the third quarter's net
income was 14 cents per diluted share and 15 cents per basic share. This
compares to last year's net loss for the third quarter of 18 cents per diluted
share and 18 cents per basic share.
On a tax basis, CRIIMI MAE had a loss for the third quarter of
approximately $17.8 million, or 33 cents per share. For last year's third
quarter, tax basis income available to common shareholders was approximately
$19.9 million, or 41 cents per share. For the first nine months of 1999, tax
basis income was approximately $13.7 million, or 26 cents per share, compared
to approximately $57.3 million, or $1.22 per share, for the first nine months
of 1998.
The sale of unsecuritized mortgage loans in one of the Company's warehouse
facilities in the third quarter of 1999 resulted in cumulative losses of
approximately $36.3 million under both GAAP and tax accounting. Under GAAP,
$35.2 million of these losses were recognized in prior quarters, and $1.1
million in losses were recognized in the third quarter of 1999. Under tax
basis accounting, the entire loss of $36.3 million was recognized in the third
quarter of 1999, when the actual loan sales took place.
CRIIMI MAE's shareholders' equity decreased to approximately $259 million
($3.86 per diluted share) at quarter end, from approximately $281 million
($4.24 per diluted share) at June 30, 1999. The decrease in shareholders'
equity during the quarter primarily resulted from an aggregate $30.5 million
decrease in the fair value of the Company's portfolio of commercial mortgage-
backed securities (CMBS) and insured mortgage securities.
The Company's net interest margin decreased by approximately $1.2 million
under GAAP and approximately $370,000 on a tax basis for the third quarter of
1999 compared to the third quarter of 1998. The decreases in net interest
margin were primarily due to an increase in interest expense related to
certain financing facilities that were outstanding for only a portion of last
year's third quarter, versus the entire third quarter of 1999.
Other items that contributed to the changes in earnings during these
periods are identified in the tables that follow.
The date currently set by the Bankruptcy Court for CRIIMI MAE and its two
affiliates to file a proposed disclosure statement with respect to their Joint
Plan of Reorganization is December 6, 1999. Judge Duncan W. Keir has also
scheduled a hearing for that date on a pending motion to approve the bidding
protection provisions in the Stock Purchase Agreement ("Agreement") entered
into on September 9, 1999 by CRIIMI MAE and an affiliate of Apollo Real Estate
Advisors IV, L.P. ("Apollo"). CRIIMI MAE, Apollo and the Official Committee
of Unsecured Creditors of CRIIMI MAE and the Official Committee of Equity
Securities Holders (collectively, the "Committees") have been actively engaged
in discussions to fashion an amended plan of reorganization that can be
supported by these parties. |
