United Financial Mortgage (AMEX:UFM)
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United Financial Mortgage Corp. Reports First Quarter Results
* Servicing Portfolio Reaches $1.5 Billion * Steve Khoshabe and Anthony
Schweiger added to Board of Directors
OAK BROOK, Ill., Sept. 9 /PRNewswire-FirstCall/ -- United Financial Mortgage
Corp. (AMEX:UFM)(the "Company") today announced results for the first quarter
ended July 31, 2004.
First Quarter Results
Revenues for the quarter ended July 31, 2004 decreased $6.9 million to $15.6
million from $22.4 million for the quarter ended July 31, 2003. Net income was
$.9 million, or $.15 per diluted share (based on 6,148,940 fully diluted shares
outstanding) for the most recent quarter, as compared with $1.8 million, or
$.43 per diluted share (based on 4,123,196 fully diluted shares outstanding),
for the corresponding period last year.
Mortgage Banking Business
As of July 31, 2004, the mortgage loans in the Company's mortgage loan-
servicing portfolio had an aggregate unpaid principal balance of $1.5 billion,
up from $939 million from the same date last year. Income from mortgage loan-
servicing increased by $561 thousand to $783 thousand for the quarter ended
July 31, 2004, a 253% increase from the same period last year. The weighted
average coupon interest rate of the mortgage loans in the loan-servicing
portfolio was approximately 5.4% as of July 31, 2004.
The Company funded $471 million in mortgage loans during the quarter ended July
31, 2004, a $547 million decrease compared to the quarter ended July 31, 2003.
Commenting on mortgage operations in the Company's first quarter, Steve
Khoshabe, President and Chief Executive Officer of the Company stated, "Despite
facing the continued challenges of today's mortgage environment, we were able
to deliver solid earnings and grow our book value to $4.97 per share."
Mr. Khoshabe added, "We continue to implement our growth strategy of increasing
our servicing portfolio, growing our core origination platform, and
diversifying our business. During the first quarter, we opened two new retail
offices in offices in Chicago, Illinois and Wilmington, North Carolina and a
wholesale operations center in Charlotte, North Carolina. In addition, we have
also added six retail branch offices through our acquisition of Vision Mortgage
Group, Inc.
"With our balanced approach of continuing to selectively build our mortgage
loan-servicing portfolio, expanding both organically and through acquisitions,
controlling costs, and diversifying our business, we believe we are
well-positioned for continued growth in fiscal 2005."
Other News
At the Company's annual meeting held on September 8, 2004, all proposals
submitted to the shareholders of the Company were approved. Accordingly, the
Board of Directors of the Company is now comprised of seven directors. The new
directors are Messrs. Steve Khoshabe, the Company's President and Chief
Executive Officer and Anthony Schweiger. Mr. Schweiger will serve as the
Company's Audit Committee Chairmen and qualifies as an audit committee
financial expert in accordance with applicable laws. Currently, Mr. Schweiger
serves as the President and Chief Executive Officer of The Tomorrow Group, LLC,
a governance and management consulting firm. Since 1992, he has been a
director and the Governance Chair of Radian Group Inc., a NYSE traded global
provider of credit enhancement products. He also serves on Radian's Audit and
Executive Committees. Since 2001, Mr. Schweiger has served as a director of
Paragon Technologies, Inc., an American Stock Exchange traded provider of
automated solutions for material flow applications. He has also been an
investor and director of Input Technologies, LLC, a supplier of human-to-
machine interface products and services since February 1998. From 1983 until
1993, Mr. Schweiger served as Chief Executive Officer of Meridian Mortgage
Corporation. In his capacity as a consultant, Mr. Schweiger advises various
service and technology businesses on governance, operational and strategic
issues. Mr. Schweiger is a graduate of the Wharton School of Finance &
Commerce at the University of Pennsylvania.
About United Financial Mortgage Corp.
United Financial Mortgage Corp. is an independent originator and servicer of
residential and commercial mortgage loans. The Company is headquartered in Oak
Brook, Illinois and has 37 retail offices and 7 wholesale operations centers
across 14 states. For additional information, please visit the Company's web
site at http://www.ufmc.com/.
This press release contains, and future oral and written statements may
contain, forward-looking statements within the meaning of such term in the
Private Securities Litigation Reform Act of 1995 with respect to the Company's
business, financial condition, results of operations, plans, objectives and
future performance. Forward-looking statements, which may be based upon
beliefs, expectations and assumptions of management and on information
currently available to management, are generally identifiable by the use of
words such as "believe," "expect," "anticipate," "plan," "intend," "estimate,"
"may," "will," "would," "could," "should" or other similar expressions.
Additionally, all statements in this document, including forward-looking
statements, speak only as of the date they are made, and the Company undertakes
no obligation to update any statement in light of new information or future
events. A number of factors, many of which are beyond the ability of the
Company to control or predict, could cause actual results to differ materially
from those in its forward-looking statements. These factors include, among
others, the following: (i) changes in demand for mortgage loans due to
fluctuations in the real estate market, interest rates or the market in which
the Company sells its mortgage loans; (ii) the Company's access to funding
sources and its ability to renew, replace or add to its existing credit
facilities on terms comparable to the current terms; (iii) assumptions
underlying the value of the Company's retained mortgage loan-servicing rights;
(iv) the negative impact of economic slowdowns or recessions; (v) management's
ability to manage the Company's growth and planned expansion; (vi) the effect
of the competitive pressures from other lenders or suppliers of credit in the
Company's market; (vii) changes in government regulations that affect the
Company's business; (viii) the Company's ability to expand origination volume
while reducing overhead; (ix) the impact of new state or federal legislation or
court decisions restricting the activities of lenders or suppliers of credit in
the Company's market; (x) other risk factors disclosed from time to time in the
Company's filings with the Securities and Exchange Commission; and (xi) the
inability of the Company to manage the risks associated with the foregoing as
well as anticipated. These risks and uncertainties should be considered in
evaluating forward-looking statements and undue reliance should not be placed
on such statements. Additional information concerning the Company and its
business, including additional factors that could materially affect the
Company's financial results, is included in the Company's filings with the
Securities and Exchange Commission.
For Further Information Contact:
Steve Khoshabe, President & Chief Executive Officer, United Financial Mortgage
Corp., 815 Commerce Drive, Suite 100, Oak Brook, IL 60523, (630) 571-7222, Fax:
(630) 571-2623,
Dave Gentry, Aurelius Consulting Group, Inc., Maitland City Plaza, 225 S.
Swoope Avenue, Suite 214, Maitland, FL 32751, (407) 644-4256, Fax: (407)
644-0758,
-- FINANCIAL TABLES FOLLOW --
UNITED FINANCIAL MORTGAGE CORP.
BALANCE SHEETS
As of July 31,
(Unaudited)
2004 2003
ASSETS
Cash and due from financial institutions $0 $1,610,280
Interest-bearing deposits in financial
institutions 11,132,042 6,931,693
Total cash and cash equivalents 11,132,042 8,541,973
Restricted cash 1,516,690 779,440
Certificates of deposit 437,182 428,857
Loans held for sale 160,247,491 215,967,931
Notes receivable-related parties 12,051 25,617
Mortgage servicing rights, net 18,272,844 9,514,331
Leasehold improvements and equipment, net 1,178,613 1,106,516
Goodwill 574,990 99,505
Prepaid expenses and other assets 2,555,875 1,118,806
Total assets $195,927,778 $237,582,976
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Warehouse lines of credit $155,617,244 $ 212,742,927
Note payable -- 350,000
Accrued expenses and other liabilities 9,722,972 9,807,090
Total liabilities 165,340,216 222,900,017
Shareholders' equity
Preferred stock, 5,000,000 authorized,
no par value, Series A redeemable shares,
63 issued and outstanding at July 31,
2004 and 2003 (aggregate liquidation
preference of $315,000) 315,000 315,000
Common stock, no par value, 20,000,000
shares authorized, 6,140,843 shares issued
at July 31, 2004 and 4,100,929 at
July 31, 2003 18,687,023 6,648,293
Retained earnings 11,907,129 8,041,256
30,909,152 15,004,549
Treasury stock, 176,700 shares at July 31,
2004 and 2003, at cost (321,590) (321,590)
Total shareholders' equity 30,587,562 14,682,959
Total liabilities and shareholders'
equity $195,927,778 $237,582,976
UNITED FINANCIAL MORTGAGE CORP.
STATEMENTS OF INCOME
For the three months ended July 31,
(Unaudited)
2004 2003
Revenues
Gain on sale of loans, net $12,286,143 $19,819,029
Loan servicing income, net 782,686 221,998
Interest income 2,441,478 2,242,451
Other income 50,172 152,678
Total revenues 15,560,479 22,436,156
Expenses
Salaries and commissions 9,829,064 15,801,557
Selling and administrative 3,112,453 2,291,208
Interest expense 1,011,278 1,270,048
Depreciation 76,877 91,643
Total expenses 14,029,672 19,454,456
Income before income taxes 1,530,807 2,981,700
Income taxes 612,323 1,192,680
Net income 914,484 1,789,020
Preferred stock dividends 0 0
Net income for common stockholders $914,484 $1,789,020
Basic earnings per common share $.15 $.46
Diluted earnings per common share $.15 $.43
Weighted average shares outstanding 5,964,143 3,889,174
DATASOURCE: United Financial Mortgage Corp.
CONTACT: Steve Khoshabe, President & Chief Executive Officer, United
Financial Mortgage Corp., +1-630-571-7222, or fax, +1-630-571-2623, or
; or Dave Gentry, Aurelius Consulting Group, Inc.,
+1-407-644-4256, or fax, +1-407-644-0758, or , for United
Mortgage
Web site: http://www.ufmc.com/