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Share Name | Share Symbol | Market | Type |
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Velocity Asset Management, | AMEX:JVI | AMEX | Ordinary Share |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 0.00 | - |
Velocity reported Q3 '08 operating income increased 23.4% to $1.84 million and income from continuing operations rose 91.4% to $1,005,000, versus Q3 2007. Velocity reported net income of $724,000 compared to net income of $384,600 in Q3 2007, an 88.3% increase. After payment of $345,000 in preferred dividends, Velocity reported Q3 net income attributable to common shareholders of $379,000, or $0.02 per diluted share, compared to net income of $39,600, or $0.01 per diluted share, in the prior year period. Velocity's Q3 2008 revenue decreased by 3.1% percent due to a decrease in acquisitions of consumer portfolios, which was offset by a 22.2% decrease in operating expenses and a 40.6% decrease in interest expense. Velocity reported a $280,700 loss in discontinued operations as a result of an additional impairment charge on a Florida investment property.
"In the face of challenging capital markets and concern about the consumer economy, we were extremely pleased with Velocity's performance during the 2008 third quarter," stated Velocity President and CEO Jack Kleinert. "We believe that the current market conditions have created a very attractive environment for acquiring charged-off consumer receivables for companies with a disciplined pricing methodology and a long-term legal approach to collections."
As of September 30, 2008, the Company's Velocity Investments subsidiary had $9.8 million outstanding, and $12.7 million in availability on its $22.5 million senior credit facility with Wells Fargo Foothill, Inc. Velocity continues to wind-down the discontinued operations of its J. Holder and VOM subsidiaries and expects to complete this process in the next 12 months. These divestitures will allow management to focus exclusively on its core, consumer receivables business, Velocity Investments.
About Velocity Asset Management, Inc.
Velocity Asset Management, Inc., through its wholly owned subsidiary, Velocity Investments, LLC, is focused on the purchase and collection of distressed consumer receivables, principally through an outsourced litigation model. The Company purchases consumer receivable portfolios that are of "litigation quality." By focusing on the quality of the portfolio prior to purchase, Velocity aims to diminish its risk and improve its overall collection rate as a percentage of principal balance. For more information, visit www.velocitycollect.com.
This Press Release contains or may contain forward-looking statements and information that are based upon beliefs of and information currently available to the Company's management as well as estimates and assumptions made by the Company's management. When used herein the words ''anticipate," "believe," "estimate," "expect," "future," "intend," "plan" and similar expressions as they relate to the Company or the Company's management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties and assumptions relating to the Company's operations and results of operations and any businesses that may be acquired by the Company, including future collections, increased revenue, increased operating income and consumer receivables under management at the Company's Velocity Investments subsidiary. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, intended or planned.
VELOCITY ASSET MANAGEMENT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS September 30, December 31, 2008 2007 ------------ ------------ (Unaudited) ASSETS Cash and cash equivalents $ 33,992 $ 162,180 Consumer receivables, net 46,152,417 46,971,014 Property and equipment, net of accumulated depreciation 47,347 64,420 Deferred income tax asset, net 83,600 98,600 Security deposits 30,224 30,224 Other assets (including $0 and $115,146 employee loan to a related party at September 30, 2008 and December 31, 2007, respectively) 351,035 487,071 Assets of discontinued operations 5,730,328 6,793,319 ------------ ------------ Total assets $ 52,428,943 $ 54,606,828 ============ ============ LIABILITIES AND STOCKHOLDERS? EQUITY LIABILITIES Accounts payable and accrued expenses $ 477,590 $ 552,269 Estimated court and media costs 5,742,939 7,374,212 Line of credit 9,792,567 14,429,138 Notes payable 400,000 ? Notes payable to related parties 740,000 200,000 Convertible subordinated notes 2,350,000 2,350,000 Income taxes payable 1,605,919 820,222 Liabilities from discontinued operations (including notes payable to related parties of $2,300,000) 5,490,675 4,374,441 ------------ ------------ Total liabilities 26,599,690 30,100,282 ------------ ------------ STOCKHOLDERS? EQUITY Series A 10% convertible preferred stock, $0.001 par value, 10,000,000 shares authorized, 1,380,000 shares issued and outstanding (liquidation preference of $13,800,000) 1,380 1,380 Common stock, $0.001 par value, 40,000,000 shares authorized, 17,875,987 and 17,066,821 shares issued and outstanding, respectively 17,875 17,066 Additional paid-in-capital 25,921,639 25,243,944 Accumulated deficit (111,641) (755,844) ------------ ------------ Total stockholders? equity 25,829,253 24,506,546 ------------ ------------ Total liabilities and stockholders? equity $ 52,428,943 $ 54,606,828 ============ ============ VELOCITY ASSET MANAGEMENT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) For the Three For the Nine Months Ended Months Ended September 30, September 30, ------------------------ ------------------------ 2008 2007 2008 2007 ----------- ----------- ----------- ----------- REVENUES Income on consumer receivables $ 3,447,831 $ 3,554,441 $10,942,757 $ 9,901,507 Other income 138 3,153 3,334 27,176 ----------- ----------- ----------- ----------- Total revenues 3,447,969 3,557,594 10,946,091 9,928,683 ----------- ----------- ----------- ----------- OPERATING EXPENSES Professional fees (including fees paid to related parties of $197,436 and $257,311 and $634,081 and $868,761 for the three and nine month periods ended September 30, 2008 and 2007, respectively) 1,246,701 1,313,876 3,817,408 3,438,740 General and administrative expenses 358,969 751,108 1,557,351 2,156,741 ----------- ----------- ----------- ----------- Total operating expenses 1,605,670 2,064,984 5,374,759 5,595,481 ----------- ----------- ----------- ----------- Income from operations 1,842,299 1,492,610 5,571,332 4,333,202 Interest expense (including interest incurred to related parties of $21,435 and $3,500 and $28,435 and $10,500 for the three and nine month periods ended September 30, 2008 and 2007, respectively) (271,286) (456,678) (880,064) (1,196,045) ----------- ----------- ----------- ----------- Income from continuing operations before provision for income taxes 1,571,013 1,035,932 4,691,268 3,137,157 Provision for income taxes 566,210 510,945 1,888,038 1,307,720 ----------- ----------- ----------- ----------- Income from continuing operations 1,004,803 524,987 2,803,230 1,829,437 Loss from discontinued operations (including fees paid and interest incurred to related parties of $-0- and $4,531 and $-0- and $4,723 and $58,778 and $58,956 and $175,056 and $164,559 for the three and nine months ended September 30, 2008 and 2007, respectively and net of tax benefit of $146,876 and $101,166 and $442,430 and $195,330 for the three and nine months ended September 30, 2008 and 2007 (280,730) (140,378) (1,124,027) (269,288) ----------- ----------- ----------- ----------- Net income 724,073 384,609 1,679,203 1,560,149 Preferred dividends (345,000) (345,000) (1,035,000) (1,035,000) ----------- ----------- ----------- ----------- Net income attributable to common stockholders $ 379,073 $ 39,609 $ 644,203 $ 525,149 =========== =========== =========== =========== Earnings (loss) per common share: Income from continuing operations: Basic $ 0.04 $ 0.01 $ 0.10 $ 0.05 Diluted $ 0.04 $ 0.01 $ 0.10 $ 0.04 Discontinued operations: Basic $ (0.02) $ (0.01) $ (0.06) $ (0.02) Diluted $ (0.02) $ (0.01) $ (0.06) $ (0.02) Net income: Basic $ 0.02 $ ? $ 0.04 $ 0.03 Diluted $ 0.02 $ ? $ 0.04 $ 0.03 Average common shares - basic 17,875,987 16,225,517 17,472,117 16,176,207 Average common shares - diluted 17,875,987 18,001,859 17,530,210 17,869,236
CONTACT: Jim Mastriani CFO Velocity Asset Management, Inc. 732/556-9090 Email Contact
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