FPFG
1998 EPS 2.50 x 15 PE = 37.50
1998 EPS 3.00 x 15 PE = 45.00
1999 EPS 4.50 x 15 PE = 67.50
1999 EPS 5.00 x 15 PE = 75.00
Looks like a good long term investment.
Read below if interested...
FIRSTPLUS Financial Group, Inc. Announces The
Substantial Elimination Of Its Non-Cash Gain-On-Sale
Revenue From Securitizations
DALLAS--(BUSINESS WIRE)--December 19, 1997--FIRSTPLUS Financial Group, Inc.
(Nasdaq: FPFG - news) today announced its securitization related non-cash ''gain-on-sale'' will be
substantially reduced in its December 1997 quarter, and in subsequent periods. As a result, expected
earnings for the December 1997 quarter, calendar 1998 year and calendar 1999 year will be
reduced; however, expected earnings for periods subsequent to 1999 may increase. FIRSTPLUS
anticipates that after elimination of its non-cash securitization gains, it may earn $2.50 to $3.00 per
diluted share in calendar 1998, and $4.50 to $5.00 per diluted share in calendar 1999. In this regard,
FIRSTPLUS is in the process of adopting a calendar reporting year.
The substantial elimination of non-cash gain-on-sale revenue is a result of increases in the discount
rate the Company uses to fairly value the interest only strips it creates when its loans are securitized.
The Company believes substantial increases in this discount rate are appropriate for interest only
strips originated in the December 1997 quarter. The Company has reviewed its assumptions for
interest only strips originated prior to the December 1997 quarter; these interest only strips are
performing within expected loss and prepayment parameters, and no impairment is indicated.
Daniel T. Phillips, FIRSTPLUS' Chairman and Chief Executive Officer, noted the following:
''The reduction of substantially all non-cash gain-on-sale revenue will enhance the quality of
FIRSTPLUS' earnings. The annuity nature of these earnings in future years should dampen earnings
volatility and provide a growing and stable base for future profitability. This change also puts
FIRSTPLUS in an enhanced competitive position. Specifically, we believe this will allow
FIRSTPLUS' stock price/earnings multiple to expand, will permit FIRSTPLUS to attract a wider
array of shareholders and will permit FIRSTPLUS to more actively acquire complementary
businesses in accretive pooling transactions.''
FIRSTPLUS' management will discuss the impact of its reduced non-cash gains-on-sale in a
conference telephone call on Friday, December 19, 1997, at 10:00 A.M. (EST). Call in numbers for
the conference call are, as follows:
Domestic call in number: 800-683-1535
Domestic replay number: 888-888-9547
International call in number: 973-633-6740
International replay number: 402-220-9952
The above statements in this press release contain forward-looking statements that involve a number
of risks and uncertainties. In addition to the factors discussed in this press release, reference is made
to the Form 8-K, filed by the Company with the Securities and Exchange Commission on December
19, 1996, for a list of, and discussion with respect to, certain factors that could cause actual results to
differ materially from the forward-looking statements contained herein.
FIRSTPLUS Financial Group, Inc. is a specialized consumer finance company that, through its
subsidiaries, originates, purchases, services and securitizes consumer finance receivables, primarily
home improvement and debt consolidation loans, all secured by liens on the borrower's home.
FIRSTPLUS, headquartered in Dallas, has regional offices in Denver, Colorado; Holly Springs,
Mississippi; Columbus, Ohio; Columbia, South Carolina; Laguna Hills, California; Salt Lake City,
Utah and a network of origination branches nationwide.
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