United Financial Mortgage (AMEX:UFM)
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United Financial Mortgage Corp. Reports Second Quarter Results
-- Book Value Increases to $5.18 Per Share
OAK BROOK, Ill., Dec. 9 /PRNewswire-FirstCall/ -- United Financial Mortgage
Corp. (AMEX:UFM) (or the "Company") today announced results for its second
quarter and six months ended October 31, 2004.
Second Quarter Results
Revenue for the quarter ended October 31, 2004 increased $1.2 million to $18.3
million from $17.1 million for the quarter ended October 31, 2003. Net income
was $965 thousand, or $.16 per diluted share (based on 6,093,856 fully diluted
shares outstanding) for the most recent quarter, as compared with $1.3 million,
or $.32 per diluted share (based on 4,104,634 fully diluted shares outstanding)
for the corresponding period last year.
Second Quarter Ended Second Quarter Ended
October 31, 2004 October 31, 2003
Revenue $18,304,299 $17,133,691
Net Income $965,671 $1,322,883
Shares Outstanding 6,093,856 4,104,634
Fully Diluted EPS $.16 $.32
Six Month Results
Revenue for the six months ended October 31, 2004 decreased 14% to $33.9
million from $39.6 million for the corresponding period of 2003. Net Income
for the six-month period fell to $1.9 million, or $.31 per diluted share (based
on 6,103,832 fully diluted shares outstanding), as compared to $3.1 million, or
$.76 per diluted share (based on 4,106,945 fully diluted shares outstanding)
for the same period last year.
Six Months Ended Six Months Ended
October 31, 2004 October 31, 2003
Revenue $33,864,780 $39,569,845
Net Income $1,884,157 $3,111,902
Shares Outstanding 6,103,832 4,106,945
Fully Diluted EPS $.31 $.76
Mortgage Banking Business
As of October 31, 2004, the mortgage loans in the Company's mortgage loan-
servicing portfolio had an aggregate unpaid principal balance of $1.6 billion,
up from $1.1 billion from the same date last year. Net income from mortgage
loan-servicing increased by $332 thousand to $835 thousand for the quarter
ended October 31, 2004, a 66% 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 October 31, 2004 and October
31, 2003.
The Company funded $687 million in mortgage loans during the quarter ended
October 31, 2004, a $65 million increase compared to the quarter ended October
31, 2003.
Commenting on mortgage operations in the Company's second quarter, Steve
Khoshabe, President and Chief Executive Officer of the Company, stated, "The
continued industry-wide reduction in refinance volume in the face of excess
capacity has led to intense pricing competition. As a result, our second
quarter was marked by significant price compression on our origination
business, which had a detrimental impact on our operating margins. Against
this backdrop and the continued challenges of today's mortgage origination
environment, we were able to deliver sound earnings and grow our book value to
$5.18 per share."
Mr. Khoshabe added, "We continue to implement our managed growth strategy of
increasing our servicing portfolio, growing our core origination platform, and
diversifying our business. During the second quarter, we opened two new core
retail offices in Baton Rouge, Louisiana and Richmond, Virginia, and a
wholesale operations center in Oklahoma City, Oklahoma. In addition, we have
also added two core retail branch offices in the state of Washington and four
in the state of Illinois through our acquisition of Vision Mortgage Group, Inc.
With our balanced approach of continuing to selectively build our mortgage
loan-servicing portfolio, careful expansion of the origination platform,
controlling costs, and diversifying our business, we believe we are well
positioned for continued growth in the second half of fiscal 2005."
Other News
Mr. Khoshabe concluded, "We are encouraged by the results of our disciplined
strategy and strong capital base in a very competitive and demanding
marketplace. Concurrently, we continue to explore a number of options to
enhance shareholder value. We believe that our capital base and management
team position us well to execute our strategy to continue to build and expand
our business to generate increased profit and value for our shareholders."
Conference Call
Management will host a conference call today at 3:30 p.m. Central time (4:30
p.m. Eastern) to discuss the second quarter operating results. The conference
call will be accessible via a toll free number by dialing 800-706-7745 and
providing the passcode 61821468. International callers should dial
617-614-3472 and provide the same passcode. A replay of the call will be
available from 6:30 p.m. Central time December 9, 2004 to 6:00 p.m. Central
time December 10, 2004 by dialing 888-286-8010 and providing the replay
passcode 70856863. International callers should dial 617-801-6888 and use the
replay passcode. The conference call will also be webcast live via the
Internet. To listen to the live webcast, log on to the Company's web site at
http://www.ufmc.com/ and click through to the Investor Information section.
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 39 retail offices and 8 wholesale operations centers
across 16 states. For additional information, please visit the Company's web
site at http://www.ufmc.com/.
This press release contains 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, including,
among others, changes in demand for mortgage loans, the Company's access to
funding sources and the terms upon which it can obtain financing, assumptions
underlying the value of the Company's retained mortgage loan-servicing rights,
the impact of economic slowdowns or recessions, management's ability to manage
the Company's growth and planned expansion, difficulties in integrating or
operating newly acquired businesses, competition in the Company's market,
changes in government regulations, the Company's ability to expand origination
volume while reducing overhead, the impact of new legislation or court
decisions restricting the activities of lenders or suppliers of credit in the
Company's market, other risk factors disclosed from time to time in the
Company's filings with the Securities and Exchange Commission and 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:
Dave Gentry, Aurelius Consulting Group, Inc., Century Bank Building,
541 S. Orlando Avenue, Suite 206, Maitland, FL 32751, (407) 644-4256,
Fax: (407) 644-0758,
-- FINANCIAL TABLES FOLLOW --
UNITED FINANCIAL MORTGAGE CORP.
BALANCE SHEETS
As of October 31,
(Unaudited)
2004 2003
ASSETS
Cash and due from financial institutions $-- $741,194
Interest-bearing deposits in financial
institutions 8,227,266 3,259,681
Total cash and cash equivalents 8,227,266 4,000,875
Restricted cash 1,832,779 1,536,605
Certificates of deposit 437,182 431,884
Loans held for sale 266,640,387 152,107,800
Mortgage servicing rights, net 20,088,215 11,506,754
Leasehold improvements and equipment, net 1,326,315 1,087,793
Goodwill 795,542 104,809
Prepaid expenses and other assets 3,362,220 1,586,969
Total assets $302,709,906 $172,363,489
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Warehouse lines of credit $259,686,198 $ 146,979,389
Notes payable -- 350,000
Accrued expenses and other liabilities 11,467,505 9,027,013
Total liabilities 271,153,703 156,356,402
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, 6,149,444 shares
issued at October 31, 2004 and 3,921,545
at October 31, 2003 18,689,993 6,649,538
Retained earnings 12,872,801 9,364,139
31,877,794 16,328,677
Treasury stock, 176,700 shares at July 31,
2004 and 2003, at cost (321,590) (321,590)
Total shareholders' equity 31,556,203 16,075,087
Total liabilities and shareholders'
equity $302,709,906 $ 172,363,489
UNITED FINANCIAL MORTGAGE CORP.
STATEMENTS OF INCOME
(Unaudited)
Three months ended Six months ended
October 31, October 31,
2004 2003 2004 2003
Revenue
Gain on sale of loans,
net $14,091,226 $14,551,417 $26,377,369 $34,370,445
Loan servicing income,
net 835,344 503,465 1,618,030 725,463
Interest income 3,105,603 2,038,560 5,547,081 4,281,011
Other income 272,126 40,249 322,300 192,926
Total revenues 18,304,299 17,133,691 33,864,780 39,569,845
Expenses
Salaries and commissions 11,357,273 10,692,229 21,186,341 26,493,786
Selling and
administrative 3,701,295 3,120,273 6,813,743 5,411,482
Interest expense 1,558,442 1,010,937 2,569,720 2,280,984
Depreciation 77,838 100,134 154,715 191,777
Total expenses 16,694,848 14,923,573 30,724,519 34,378,029
Income before income taxes 1,609,451 2,210,118 3,140,261 5,191,816
Income taxes 643,780 887,235 1,256,104 2,079,914
Net income $965,671 $1,322,883 $1,884,157 $3,111,902
Basic earnings per common
share $0.16 $0.34 $0.32 $0.79
Diluted earnings per common
share $0.16 $0.32 $0.31 $0.76
Basic shares outstanding 5,965,152 3,924,500 5,964,647 3,921,545
Diluted shares outstanding 6,093,856 4,104,634 6,103,832 4,106,945
http://www.ufmc.com/DATASOURCE: United Financial Mortgage Corp.
CONTACT: Dave Gentry of Aurelius Consulting Group, Inc.,
+1-407-644-4256, or fax, +1-407-644-0758, or , for United
Financial Mortgage Corp.
Web site: http://www.ufmc.com/