Exhibit 99.1
| | |
| | 28405 Van Dyke Avenue
Warren, Michigan 48093 www.AssetAcceptance.com |
Contact:
Victoria Sivrais
FD
312-553-6715 / victoria.sivrais@fd.com
Asset Acceptance Capital Corp. Reports Fourth Quarter and Full Year 2009 Results
Increased purchasing during the quarter; Acquired $43.0M in charged-off consumer receivable portfolios
Warren, Mich., March 10, 2010 – Asset Acceptance Capital Corp. (NASDAQ: AACC), a leading purchaser and collector of charged-off consumer debt, today announced results for the quarter and fiscal year ended December 31, 2009.
Highlights from the fourth quarter 2009 include:
| | • | | Acquired $43.0 million (net of buybacks) in charged-off consumer receivable portfolios during the fourth quarter of 2009, with an aggregate value of $1.4 billion, or 3.08% of face value; |
| | • | | Cash collections of $74.8 million; |
| | • | | Non-cash net impairment of purchased receivables of $32.4 million; |
| | • | | Operating expenses of 64.9 percent of cash collections; and |
| | • | | Net loss of $20.2 million. |
Rion Needs, President and CEO, commented: “The operating environment in 2009 has been one of the most challenging periods in our Company’s history, with the fourth quarter proving to be one of the most difficult quarters of the year. The macroeconomic environment continued to adversely impact our cash collections, particularly on our older vintages. In connection with the preparation of our financial statements for the quarter and year ended December 31, 2009, we observed a significant difference between actual and projected cash collections in some of these older portfolios, which caused us to perform a more in depth review of our expectation of future cash collections. This resulted in a large non-cash impairment charge of $32.4 million, or $0.66 per share, net of the tax benefit. As a result, we reported a net loss for fourth quarter and the year. We are hopeful that this action will aid in minimizing non-cash impairments going forward.”
Needs continued, “While the economic headwinds persisted throughout the year, the pricing environment remained attractive as supply of charge-offs from issuers continued to expand and the overall demand remained soft. We continued to ramp up our purchasing during the back half of the year, and expect this initiative to pay dividends as we move through 2010 and collect on the newer vintage. Additionally, we made further progress with our initiatives to improve operational efficiencies that not only helped us manage through the current economic climate but also positions us for long-term value creation. Despite a difficult 2009, we look forward to 2010 and the opportunities for our business.”
Asset Acceptance Fourth Quarter and Full Year 2009 Results
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Fourth Quarter 2009 Review
Asset Acceptance reported cash collections of $74.8 million in the fourth quarter ended December 31, 2009, versus cash collections of $83.3 million in the year-ago period.
Total revenues were $18.7 million in the fourth quarter of 2009, compared to total revenues of $55.0 million in the fourth quarter of 2008. Amortization of purchased receivables in the fourth quarter of 2009 was 75.6% of total cash collections versus 34.2% of total cash collections in the fourth quarter of 2008. The Company reported a fourth quarter of 2009 non-cash net impairment charge of $32.4 million on purchased receivables, versus $4.6 million in the prior year quarter.
The net loss for the quarter was $20.2 million, or $0.66 per fully diluted share, compared to net income of $3.8 million, or $0.12 per fully diluted share, in the fourth quarter of 2008. Earnings Before Interest, Taxes, Depreciation and Amortization, including purchased receivables amortization (“Adjusted EBITDA”), decreased to $28.2 million in the fourth quarter of 2009, down 28.2% compared to the year-ago period. Please refer to the table on page three, which reconciles net income according to Generally Accepted Accounting Principles (“GAAP”) to Adjusted EBITDA.
During the fourth quarter of 2009, the Company invested $43.0 million to purchase charged-offconsumer debt portfolios with a face value of $1.4 billion, for a blended rate of 3.08% of face value. This compares to the prior-year fourth quarter, when the Company invested $31.9 million to purchase consumer debt portfolios with a face value of $630.0 million, representing a blended rate of 5.06% of face value. All purchase data is adjusted for buybacks.
In addition to lower cash collections in the quarter, the Company reported higher operating expenses compared to the prior year. Total operating expenses in the quarter increased 5.5% to $48.5 million, from $46.0 million in the fourth quarter of 2008. For the 2009 fourth quarter, Asset Acceptance reported operating expenses of 64.9% of cash collections, up from 55.2% of cash collections in the prior year quarter.
Twelve Months Ended December 31, 2009
For the fiscal year ended December 31, 2009, the Company reported cash collections of $334.0 million compared to cash collections of $369.6 million in fiscal year 2008.
Total revenues in the fiscal year 2009 were $172.5 million versus $234.2 million in 2008. For 2009, amortization of purchased receivables was 48.7% of total cash collections versus 37.0% of total cash collections in the same period of last year. Net non-cash impairments for the fiscal year of 2009 totaled $49.5 million, versus $13.0 million for the year 2008.
The net loss for the twelve months of 2009 was $16.4 million, or $0.54 per fully diluted share, compared to net income of $15.7 million, or $0.51 per fully diluted share, in 2008. For the fiscal year ended December 31, 2009, Adjusted EBITDA declined to $153.3 million, a decrease of 15.3% when compared to the year ended 2008.
The Company invested $121.9 million to purchase charged-off consumer debt portfolios with a face value of $4.5 billion, for a blended rate of 2.73% during 2009, compared to $154.2 million with a face value of $3.8 billion, for a blended rate of 4.05% in 2008. All purchase data is adjusted for buybacks.
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Asset Acceptance Fourth Quarter and Full Year 2009 Results
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Reconciliation of GAAP Net (Loss) Income to Adjusted EBITDA (Unaudited)
This press release includes a discussion of “Adjusted EBITDA,” which is a non-GAAP financial measure. The Company defines Adjusted EBITDA as net (loss) income plus (a) the (benefit) provision for income taxes, (b) interest expense, net, (c) depreciation and amortization, (d) share-based compensation, (e) (gain) loss on sale of assets, net, (f) impairment of assets and (g) purchased receivables amortization.
The Company believes this non-GAAP financial measure provides important supplemental information to management and investors. This non-GAAP financial measure reflects an additional way of viewing aspects of the Company’s operations that, when viewed with the GAAP results and the accompanying reconciliation to the most directly comparable GAAP financial measure, provide a more complete understanding of factors and trends affecting the Company’s business and results of operations.
Management uses Adjusted EBITDA for planning purposes, including the preparation of internal budgets and forecasts; in communications with the Board of Directors, stockholders, analysts and investors concerning our financial performance; as a key component in management’s annual incentive compensation plan; and as a measure of operating performance for the financial covenants in our amended credit agreement. The Company also believes that analysts and investors use Adjusted EBITDA as supplemental measures to evaluate the overall operating performance of companies in its industry.
Adjusted EBITDA, which is a non-GAAP financial measure, should not be considered an alternative to, or more meaningful than, net (loss) income prepared on a GAAP basis. Management strongly encourages investors to review the Company’s consolidated financial statements in their entirety and to not rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare this financial measure with other companies’ non-GAAP financial measures having the same or similar names. In addition, the Company expects to continue to incur expenses similar to the non-GAAP adjustments described above, and exclusion of these items from the Company’s non-GAAP measure should not be construed as an inference that these costs are unusual, infrequent or non-recurring.
The Company provided the following table which reconciles GAAP net (loss) income, as reported, to Adjusted EBITDA.
| | | | | | | | | | | | | | |
| | | Three months ended December 31, | | Twelve months ended December 31, |
| | | 2009 | | | 2008 | | 2009 | | | 2008 |
Net (loss) income | | $ | (20,236,860 | ) | | $ | 3,781,235 | | $ | (16,434,097 | ) | | $ | 15,723,196 |
Adjustments: | | | | | | | | | | | | | | |
Income tax (benefit) expense | | | (12,020,016 | ) | | | 2,146,351 | | | (9,757,449 | ) | | | 9,680,968 |
Interest expense, net | | | 2,610,979 | | | | 3,128,386 | | | 10,134,906 | | | | 12,991,942 |
Depreciation and amortization | | | 1,164,412 | | | | 1,004,300 | | | 4,107,635 | | | | 3,954,802 |
Share-based compensation | | | 254,309 | | | | 320,111 | | | 1,328,402 | | | | 1,329,298 |
(Gain) loss on sale of assets, net | | | (151,840 | ) | | | 210,102 | | | (44,739 | ) | | | 56,825 |
Impairment of assets | | | — | | | | 170,692 | | | 1,167,600 | | | | 616,343 |
Purchased receivables amortization | | | 56,561,720 | | | | 28,491,595 | | | 162,755,316 | | | | 136,677,348 |
| | | | | | | | | | | | | | |
Adjusted EBITDA | | $ | 28,182,704 | | | $ | 39,252,772 | | $ | 153,257,574 | | | $ | 181,030,722 |
| | | | | | | | | | | | | | |
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Asset Acceptance Fourth Quarter and Full Year 2009 Results
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Fourth Quarter and Full Year 2009 Earnings Conference Call
Asset Acceptance Capital Corp. will host a conference call at 5 p.m. Eastern today to discuss these results and current business trends. To listen to a live webcast of the call and access the presentation, please go to theinvestor section of the Company’s web site atwww.AssetAcceptance.com. A replay of the webcast will be available until March 10, 2011.
About Asset Acceptance Capital Corp.
For more than45 years, Asset Acceptance has provided credit originators, such as credit card issuers, consumer finance companies, retail merchants, utilities and others an efficient alternative in recovering defaulted consumer debt. For more information, please visitwww.AssetAcceptance.com.
Asset Acceptance Capital Corp. Safe Harbor Statement
This press release contains certain statements, including the Company’s plans and expectations regarding its operating strategies, charged-off receivables and costs, which are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include reference to the Company’s presentations and webcasts. These forward-looking statements reflect the Company’s views, expectations and beliefs at the time such statements were made with respect to such matters, as well as the Company’s future plans, objectives, events, portfolio purchases and pricing, collections and financial results such as revenues, expenses, income, earnings per share, capital expenditures, operating margins, financial position, expected results of operations and other financial items. Forward-looking statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions (“Risk Factors”) that make the timing, extent, likelihood and degree of occurrence of these matters difficult to predict. Words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “should,” “could,” “will,” variations of such words and similar expressions are intended to identify forward-looking statements. There are a number of factors, many of which are beyond the Company’s control, which could cause actual results and outcomes to differ materially from those described in the forward-looking statements. Risk Factors include, among others: ability to purchase charged-off consumer receivables at appropriate prices, ability to continue to acquire charged-off receivables in sufficient amounts to operate efficiently and profitably, employee turnover, ability to compete in the marketplace and acquiring charged-off receivables in industries that the Company has little or no experience. These Risk Factors also include, among others, the Risk Factors discussed under “Item 1A Risk Factors” in the Company’s most recently filed Annual Report on Form 10-K and in other SEC filings, in each case under a section titled “Risk Factors” or similar headings and those discussions regarding risk factors as well as the discussion of forward-looking statements in such sections are incorporated herein by reference. Other Risk Factors exist, and new Risk Factors emerge from time to time that may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Furthermore, the Company expressly disclaims any obligation to update, amend or clarify forward-looking statements.
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Asset Acceptance Fourth Quarter and Full Year 2009 Results
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Supplemental Financial Data
| | | | | | | | | | | | | | | | | | | | |
(Unaudited, Dollars in Millions, except collections per account representative) | | Q4 ‘09 | | | Q3 ‘09 | | | Q2 ‘09 | | | Q1 ‘09 | | | Q4 ‘08 | |
Total revenues | | $ | 18.7 | | | $ | 47.7 | | | $ | 49.1 | | | $ | 57.0 | | | $ | 55.0 | |
Cash collections | | $ | 74.8 | | | $ | 77.8 | | | $ | 87.3 | | | $ | 94.1 | | | $ | 83.3 | |
Operating expenses to cash collections | | | 64.9 | % | | | 61.8 | % | | | 51.6 | % | | | 50.0 | % | | | 55.2 | % |
Traditional call center collections | | $ | 32.6 | | | $ | 32.7 | | | $ | 36.1 | | | $ | 41.0 | | | $ | 35.1 | |
Legal collections | | $ | 31.4 | | | $ | 33.1 | | | $ | 38.5 | | | $ | 38.7 | | | $ | 34.9 | |
Other collections | | $ | 10.8 | | | $ | 12.0 | | | $ | 12.7 | | | $ | 14.4 | | | $ | 13.3 | |
Amortization rate | | | 75.6 | % | | | 39.0 | % | | | 44.1 | % | | | 39.7 | % | | | 34.2 | % |
Collections on fully amortized portfolios | | $ | 14.2 | | | $ | 14.9 | | | $ | 15.8 | | | $ | 18.3 | | | $ | 17.7 | |
Core amortization rate (Note 1) | | | 93.4 | % | | | 48.2 | % | | | 53.9 | % | | | 49.3 | % | | | 43.4 | % |
Investment in purchased receivables (Note 2) | | $ | 43.0 | | | $ | 37.1 | | | $ | 19.9 | | | $ | 21.9 | | | $ | 31.9 | |
Face value of purchased receivables (Note 2) | | $ | 1,395.5 | | | $ | 1,597.8 | | | $ | 724.9 | | | $ | 741.7 | | | $ | 630.0 | |
Average cost of purchased receivables (Note 2) | | | 3.08 | % | | | 2.32 | % | | | 2.74 | % | | | 2.95 | % | | | 5.06 | % |
Number of purchased receivable portfolios | | | 37 | | | | 33 | | | | 22 | | | | 31 | | | | 23 | |
Collections per account representative FTE | | $ | 29,345 | | | $ | 31,413 | | | $ | 38,858 | | | $ | 42,940 | | | $ | 34,994 | |
Average account representative FTE’s | | | 1,112 | | | | 1,040 | | | | 929 | | | | 955 | | | | 1,003 | |
Note 1: Core amortization rate is amortization divided by collections on non-fully amortized portfolios.
Note 2: All purchase data is adjusted for buybacks.
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Asset Acceptance Fourth Quarter and Full Year 2009 Results
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The Company provided the following details regarding purchased receivable revenues:
| | | | | | | | | | | | | | | | | | | | |
| | | Three months ended December 31, 2009 |
Year of Purchase | | Collections | | Revenue | | | Amortization
Rate (1) | | | Monthly
Yield (2) | | | Net
Impairments | | | Zero Basis
Collections |
2004 and prior | | $ | 15,242,351 | | $ | 9,368,895 | | | N/M | | | N/M | | | $ | 4,238,000 | | | $ | 10,708,969 |
2005 | | | 4,330,183 | | | (6,349,293 | ) | | N/M | | | N/M | | | | 9,025,000 | | | | 1,069,404 |
2006 | | | 10,496,427 | | | (6,605,124 | ) | | N/M | | | N/M | | | | 13,587,000 | | | | 1,380,421 |
2007 | | | 14,272,149 | | | 2,619,833 | | | 81.6 | % | | 1.25 | % | | | 5,546,000 | | | | 880,453 |
2008 | | | 17,064,373 | | | 8,847,629 | | | 48.2 | | | 3.17 | | | | 26,316 | | | | 78,279 |
2009 | | | 13,382,243 | | | 10,344,066 | | | 22.7 | | | 4.00 | | | | — | | | | 86,345 |
| | | | | | | | | | | | | | | | | | | | |
Totals | | $ | 74,787,726 | | $ | 18,226,006 | | | 75.6 | % | | 1.92 | % | | $ | 32,422,316 | | | $ | 14,203,871 |
| | | | | | | | | | | | | | | | | | | | |
| |
| | | Three months ended December 31, 2008 |
Year of Purchase | | Collections | | Revenue | | | Amortization
Rate (1) | | | Monthly
Yield (2) | | | Net
Impairments | | | Zero Basis
Collections |
2003 and prior | | $ | 16,922,585 | | $ | 16,030,474 | | | N/M | | | N/M | | | $ | 285,600 | | | $ | 14,205,902 |
2004 | | | 6,283,258 | | | 4,139,738 | | | 34.1 | % | | 6.08 | % | | | 1,774,300 | | | | 1,055,473 |
2005 | | | 6,875,733 | | | 3,846,204 | | | 44.1 | | | 4.08 | | | | 336,000 | | | | 24,133 |
2006 | | | 15,740,083 | | | 10,127,371 | | | 35.7 | | | 4.88 | | | | 2,167,497 | | | | 1,727,832 |
2007 | | | 19,736,899 | | | 11,264,597 | | | 42.9 | | | 3.47 | | | | 20,813 | | | | 637,223 |
2008 | | | 17,787,020 | | | 9,445,599 | | | 46.9 | | | 2.66 | | | | 18,276 | | | | 73,516 |
| | | | | | | | | | | | | | | | | | | | |
Totals | | $ | 83,345,578 | | $ | 54,853,983 | | | 34.2 | % | | 5.13 | % | | $ | 4,602,486 | | | $ | 17,724,079 |
| | | | | | | | | | | | | | | | | | | | |
| |
| | | Twelve months ended December 31, 2009 |
Year of Purchase | | Collections | | Revenue | | | Amortization
Rate (1) | | | Monthly
Yield (2) | | | Net
Impairments | | | Zero Basis
Collections |
2004 and prior | | $ | 76,818,620 | | $ | 59,351,726 | | | N/M | | | N/M | | | $ | 9,916,500 | | | $ | 51,005,995 |
2005 | | | 22,725,619 | | | 2,276,130 | | | 90.0 | % | | 0.88 | % | | | 11,770,000 | | | | 1,968,651 |
2006 | | | 53,239,336 | | | 19,573,500 | | | 63.2 | | | 3.00 | | | | 19,855,000 | | | | 6,523,756 |
2007 | | | 69,890,696 | | | 31,214,488 | | | 55.3 | | | 3.05 | | | | 6,994,000 | | | | 3,204,897 |
2008 | | | 83,430,138 | | | 38,422,017 | | | 53.9 | | | 2.91 | | | | 969,254 | | | | 332,543 |
2009 | | | 27,926,188 | | | 20,437,420 | | | 26.8 | | | 3.98 | | | | — | | | | 124,996 |
| | | | | | | | | | | | | | | | | | | | |
Totals | | $ | 334,030,597 | | $ | 171,275,281 | | | 48.7 | % | | 4.27 | % | | $ | 49,504,754 | | | $ | 63,160,838 |
| | | | | | | | | | | | | | | | | | | | |
| |
| | | Twelve months ended December 31, 2008 |
Year of Purchase | | Collections | | Revenue | | | Amortization
Rate (1) | | | Monthly
Yield (2) | | | Net
Impairments | | | Zero Basis
Collections |
2003 and prior | | $ | 86,570,398 | | $ | 80,343,561 | | | N/M | | | N/M | | | $ | (1,575,800 | ) | | $ | 66,525,760 |
2004 | | | 32,275,692 | | | 22,173,829 | | | 31.3 | % | | 6.93 | % | | | 4,582,964 | | | | 3,707,110 |
2005 | | | 35,638,117 | | | 14,871,669 | | | 58.3 | | | 3.13 | | | | 4,698,986 | | | | 80,738 |
2006 | | | 79,953,394 | | | 50,894,934 | | | 36.3 | | | 5.30 | | | | 4,627,497 | | | | 7,493,922 |
2007 | | | 93,183,368 | | | 44,063,847 | | | 52.7 | | | 2.88 | | | | 688,813 | | | | 715,897 |
2008 | | | 41,957,161 | | | 20,552,942 | | | 51.0 | | | 2.68 | | | | 18,276 | | | | 101,294 |
| | | | | | | | | | | | | | | | | | | | |
Totals | | $ | 369,578,130 | | $ | 232,900,782 | | | 37.0 | % | | 5.60 | % | | $ | 13,040,736 | | | $ | 78,624,721 |
| | | | | | | | | | | | | | | | | | | | |
| (1) | “N/M” indicates that the calculated percentage is not meaningful. |
| (2) | The monthly yield is the weighted-average yield determined by dividing purchased receivable revenues recognized in the period by the average of the beginning monthly carrying values of the purchased receivables for the period presented. |
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Asset Acceptance Fourth Quarter and Full Year 2009 Results
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Asset Acceptance Capital Corp.
Consolidated Statements of Operations
(Unaudited)
| | | | | | | | | | | | | | | | |
| | | Three months ended December 31, | | | Twelve months ended December 31, | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
Revenues | | | | | | | | | | | | | | | | |
Purchased receivable revenues, net | | $ | 18,226,006 | | | $ | 54,853,983 | | | $ | 171,275,281 | | | $ | 232,900,782 | |
Gain on sale of purchased receivables | | | 396,133 | | | | — | | | | 399,373 | | | | 165,040 | |
Other revenues, net | | | 118,490 | | | | 170,341 | | | | 812,947 | | | | 1,146,494 | |
| | | | | | | | | | | | | | | | |
Total revenues | | | 18,740,629 | | | | 55,024,324 | | | | 172,487,601 | | | | 234,212,316 | |
| | | | | | | | | | | | | | | | |
Expenses | | | | | | | | | | | | | | | | |
Salaries and benefits | | | 20,349,896 | | | | 19,385,443 | | | | 77,666,083 | | | | 83,348,494 | |
Collections expense | | | 22,575,623 | | | | 20,948,870 | | | | 89,095,287 | | | | 89,458,611 | |
Occupancy | | | 2,128,572 | | | | 1,894,194 | | | | 7,588,100 | | | | 7,727,356 | |
Administrative | | | 2,050,788 | | | | 2,362,025 | | | | 8,694,344 | | | | 10,510,635 | |
Depreciation and amortization | | | 1,164,412 | | | | 1,004,300 | | | | 4,107,635 | | | | 3,954,802 | |
Impairment of assets | | | — | | | | 170,692 | | | | 1,167,600 | | | | 616,343 | |
Loss on disposal of equipment and other assets | | | 244,293 | | | | 210,102 | | | | 354,634 | | | | 221,865 | |
| | | | | | | | | | | | | | | | |
Total operating expenses | | | 48,513,584 | | | | 45,975,626 | | | | 188,673,683 | | | | 195,838,106 | |
| | | | | | | | | | | | | | | | |
(Loss) income from operations | | | (29,772,955 | ) | | | 9,048,698 | | | | (16,186,082 | ) | | | 38,374,210 | |
Other income (expense) | | | | | | | | | | | | | | | | |
Interest expense | | | (2,629,954 | ) | | | (3,128,587 | ) | | | (10,168,671 | ) | | | (13,023,938 | ) |
Interest income | | | 18,975 | | | | 201 | | | | 33,765 | | | | 31,996 | |
Other | | | 127,058 | | | | 7,274 | | | | 129,442 | | | | 21,896 | |
| | | | | | | | | | | | | | | | |
(Loss) income before income taxes | | | (32,256,876 | ) | | | 5,927,586 | | | | (26,191,546 | ) | | | 25,404,164 | |
Income tax (benefit) expense | | | (12,020,016 | ) | | | 2,146,351 | | | | (9,757,449 | ) | | | 9,680,968 | |
| | | | | | | | | | | | | | | | |
Net (loss) income | | $ | (20,236,860 | ) | | $ | 3,781,235 | | | $ | (16,434,097 | ) | | $ | 15,723,196 | |
| | | | | | | | | | | | | | | | |
| | | | |
Weighted-average number of shares: | | | | | | | | | | | | | | | | |
Basic | | | 30,657,948 | | | | 30,579,066 | | | | 30,633,936 | | | | 30,566,031 | |
Diluted | | | 30,657,948 | | | | 30,581,939 | | | | 30,633,936 | | | | 30,592,317 | |
(Loss) earnings per common share outstanding: | | | | | | | | | | | | | | | | |
Basic | | $ | (0.66 | ) | | $ | 0.12 | | | $ | (0.54 | ) | | $ | 0.51 | |
Diluted | | $ | (0.66 | ) | | $ | 0.12 | | | $ | (0.54 | ) | | $ | 0.51 | |
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Asset Acceptance Fourth Quarter and Full Year 2009 Results
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Asset Acceptance Capital Corp.
Consolidated Statements of Financial Position
(Unaudited)
| | | | | | | | |
| | | December 31, 2009 | | | December 31, 2008 | |
ASSETS | |
Cash | | $ | 4,935,248 | | | $ | 6,042,859 | |
Purchased receivables, net | | | 319,772,006 | | | | 361,808,502 | |
Income taxes receivable | | | 5,553,181 | | | | 3,934,029 | |
Property and equipment, net | | | 14,521,666 | | | | 12,526,817 | |
Goodwill | | | 14,323,071 | | | | 14,323,071 | |
Intangible assets, net | | | 1,079,065 | | | | 2,453,117 | |
Other assets | | | 6,231,732 | | | | 7,082,721 | |
| | | | | | | | |
Total assets | | $ | 366,415,969 | | | $ | 408,171,116 | |
| | | | | | | | |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY | |
Liabilities: | | | | | | | | |
Accounts payable | | $ | 3,002,299 | | | $ | 3,388,320 | |
Accrued liabilities | | | 21,294,388 | | | | 21,476,207 | |
Income taxes payable | | | 1,196,071 | | | | 658,329 | |
Notes payable | | | 160,022,514 | | | | 181,550,000 | |
Capital lease obligations | | | 278,459 | | | | — | |
Deferred tax liability, net | | | 57,524,754 | | | | 64,470,002 | |
| | | | | | | | |
Total liabilities | | | 243,318,485 | | | | 271,542,858 | |
| | | | | | | | |
| | |
Stockholders’ equity: | | | | | | | | |
Preferred stock, $0.01 par value, 10,000,000 shares authorized, no shares issued and outstanding | | | — | | | | — | |
Common stock, $0.01 par value, 100,000,000 shares authorized; issued shares — 33,220,132 and 33,169,552 at December 31, 2009 and 2008, respectively | | | 332,201 | | | | 331,696 | |
Additional paid in capital | | | 148,243,688 | | | | 146,915,791 | |
Retained earnings | | | 18,754,217 | | | | 35,188,314 | |
Accumulated other comprehensive loss, net of tax | | | (2,955,451 | ) | | | (4,664,862 | ) |
Common stock in treasury; at cost, 2,616,424 and 2,596,521 shares at December 31, 2009 and 2008, respectively | | | (41,277,171 | ) | | | (41,142,681 | ) |
| | | | | | | | |
Total stockholders’ equity | | | 123,097,484 | | | | 136,628,258 | |
| | | | | | | | |
Total liabilities and stockholders’ equity | | $ | 366,415,969 | | | $ | 408,171,116 | |
| | | | | | | | |
8
Asset Acceptance Fourth Quarter and Full Year 2009 Results
Page 9 of 9 ~
ASSET ACCEPTANCE CAPITAL CORP.
Consolidated Statements of Cash Flows
(Unaudited)
| | | | | | | | |
| | | For the Years Ended December 31, | |
| | | 2009 | | | 2008 | |
Cash flows from operating activities | | | | | | | | |
Net (loss) income | | $ | (16,434,097 | ) | | $ | 15,723,196 | |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | | | | | | | | |
Depreciation and amortization | | | 4,107,635 | | | | 3,954,802 | |
Amortization of deferred financing costs | | | 670,559 | | | | 506,821 | |
Deferred income taxes | | | (7,806,252 | ) | | | 5,770,054 | |
Share-based compensation expense | | | 1,328,402 | | | | 1,329,298 | |
Net impairment of purchased receivables | | | 49,504,755 | | | | 13,040,736 | |
Non-cash revenue | | | (1,499,743 | ) | | | (575,006 | ) |
Loss on disposal of equipment and other assets | | | 354,634 | | | | 221,865 | |
Gain on sale of purchased receivables | | | (399,373 | ) | | | (165,040 | ) |
Impairment of assets | | | 1,167,600 | | | | 616,343 | |
Changes in assets and liabilities: | | | | | | | | |
Decrease (increase) in other assets | | | 2,016,356 | | | | (845,756 | ) |
(Decrease) in accounts payable and other accrued liabilities | | | (397,257 | ) | | | (53,490 | ) |
(Decrease) increase in income taxes | | | (1,081,410 | ) | | | 149,088 | |
| | | | | | | | |
Net cash provided by operating activities | | | 31,531,809 | | | | 39,672,911 | |
| | | | | | | | |
| | |
Cash flows from investing activities | | | | | | | | |
Investment in purchased receivables, net of buybacks | | | (118,319,478 | ) | | | (152,289,315 | ) |
Principal collected on purchased receivables | | | 114,750,304 | | | | 124,211,618 | |
Proceeds from sale of purchased receivables | | | 399,863 | | | | 167,405 | |
Purchase of property and equipment | | | (5,976,404 | ) | | | (5,658,784 | ) |
Proceeds from sale of property and equipment | | | 4,197 | | �� | | 7,800 | |
| | | | | | | | |
Net cash used in investing activities | | | (9,141,518 | ) | | | (33,561,276 | ) |
| | | | | | | | |
| | |
Cash flows from financing activities | | | | | | | | |
Borrowings under notes payable | | | 49,200,000 | | | | 128,000,000 | |
Repayment of notes payable | | | (70,727,486 | ) | | | (137,700,000 | ) |
Payment of deferred financing costs | | | (1,835,926 | ) | | | (660,575 | ) |
Repayment of capital lease obligations | | | — | | | | (15,927 | ) |
Purchase of treasury shares | | | (134,490 | ) | | | (166,753 | ) |
| | | | | | | | |
Net cash (used in) financing activities | | | (23,497,902 | ) | | | (10,543,255 | ) |
| | | | | | | | |
Net decrease in cash | | | (1,107,611 | ) | | | (4,431,620 | ) |
Cash at beginning of year | | | 6,042,859 | | | | 10,474,479 | |
| | | | | | | | |
Cash at end of year | | $ | 4,935,248 | | | $ | 6,042,859 | |
| | | | | | | | |
| | |
Supplemental disclosure of cash flow information | | | | | | | | |
Cash paid for interest, net of capitalized interest | | $ | 9,593,119 | | | $ | 12,588,205 | |
Net cash (received) paid for income taxes | | $ | (869,787 | ) | | $ | 3,724,444 | |
Non-cash investing and financing activities: | | | | | | | | |
Change in fair value of swap liability | | $ | (2,570,415 | ) | | $ | 4,117,571 | |
Change in unrealized loss on cash flow hedge | | $ | 1,709,411 | | | $ | (2,652,735 | ) |
Purchased receivable obligations incurred | | $ | 2,399,832 | | | $ | — | |
Capital lease obligations incurred | | $ | 278,459 | | | $ | — | |
9
