Dave...added some TAXI on nice earnings, reinstating dividend, and new financing through ML which will be accretive to earnings vs old financing costs...Wednesday August 14, 9:04 am Eastern Time
Press Release
SOURCE: Medallion Financial Corp.
Medallion Announces Second Quarter Earnings and New Financing Commitment; Merrill Lynch Facility for Up to $250,000,000 Expected to Close Within 45 Days
NEW YORK, Aug. 14 /PRNewswire-FirstCall/ -- Medallion Financial Corp. (Nasdaq: TAXI - News), a specialty commercial finance company with the leading position servicing the taxi industry in the United States, small business commercial lending, and the world's largest taxi top advertising company, announced net investment income for the 2002 second quarter, before one-time debt and refinancing charges related to the new financing facility, of $1,280,000 or $0.07 per diluted common share, compared to net investment income of $242,000 or $0.01 per share in the 2002 first quarter. Net investment income per share after the one-time charges for the 2002 second quarter was $ (.10) per diluted common share. ADVERTISEMENT
Total assets under management were $696 million, compared to $744 million at December 31, 2001. The decline mainly reflects the $54,000,000 reduction in bank and senior noteholder debt outstanding. Delinquencies on the Company's commercial loan portfolio decreased in the 30, 60, and 90-day categories. The Company now has the equivalent of a loan loss reserve for commercial loans of 3.62%. The Company's realized loan losses, historically have averaged below 1%.
Revenues in the taxi top advertising division rose sharply to $1,809,000 from $1,420,000 in the 2002 first quarter, for an increase of 27%. This was due primarily from a strong improvement in the advertising market as ad spending increased. The Company believes that advertising will continue to increase during the second half of the year as well.
The Company also announced that it has signed a commitment letter with Merrill Lynch for a new medallion loan lending facility for up to $250 million. The facility would eventually replace the majority of Medallion's existing bank facility and senior secured notes.
Andrew Murstein, President of Medallion Financial, stated, "We are extremely pleased with this new transaction. The new facility will be for medallion loans only. The Merrill Lynch facility, which is conditional on final due diligence, and bank and note holder approvals, is expected to close within 45 days. The Merrill facility may be extended by mutual agreement for two years, and is longer, for a greater amount, and less expensive than our current combined commercial loan and medallion loan facility. In addition, this facility provides us with a large amount of availability with which we can continue to grow our business."
James E. Jack, EVP and CFO of Medallion stated, " This transaction with a major financial institution will enable us to grow our core business and improve our profitability and returns. Separately, we are also pleased to announce that we have selected PriceWaterhouseCoopers, the world's largest accounting firm, as our auditor to replace Arthur Andersen. PWC has extensive experience in financial institutions and regulated investment companies, and we look forward to working with them for many years to come. With the new Merrill facility, a strong balance sheet, emphasis on efficiencies, and a continued good pipeline, we are well positioned."
Medallion also announced that its Board of Directors has declared and will pay a cash dividend of $.03 per share. The dividend will be payable on September 13, 2002 to shareholders of record on September 3, 2002.
Mr. Murstein concluded, "Once again, we could not be more pleased with the Merrill transaction. Pricing on the facility starts at 1 month Libor plus 150 basis points. This facility significantly lowers our borrowing costs, and will be immediately accretive to our earnings."
On a separate note, Medallion is also pleased to announce that its 2001 Annual Report has earned an award form the League of American Communications Professionals for its overall presentation and its information accessibility. For a free copy of the report you may contact the company or visit the company's web site at medallionfinancial.com .
About Medallion Financial
Medallion Financial Corp. is a specialty finance company with a leading position in the origination and servicing of loans financing the purchase of taxicab medallions and related assets. The Company also originates and services commercial loans financing small businesses in other targeted industries, and operates the largest taxicab rooftop advertising business in the nation. The Company and its subsidiaries have lent over $1 billion to the taxicab industry and commercial equipment industries. As a regulated investment company (RIC), Medallion complies with the requirement to distribute at least 90% of its taxable income to shareholders, and as a consequence, pays no corporate income tax on the amount of income distributed.
Please note that this press release contains forward-looking statements, which involve risks and uncertainties. Medallion's actual results may differ significantly from the results discussed in such forward-looking statements. Factors that might cause such a difference include, but are not limited to, those factors discussed under the heading "Investment Considerations," in Medallion's
Major news for this company and it's trading fairly close to it's low of the year here....tuna |
