Exhibit 99.1
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| FOR IMMEDIATE RELEASE | |
| | FOR FURTHER INFORMATION CONTACT: Robin N. Lowe Chief Financial Officer T: 345-815-9919 E: Robin.Lowe@AltisourceAMC.com |
Altisource Residential Corporation Reports Third Quarter 2014 Results
FREDERIKSTED, U.S. Virgin Islands, November 4, 2014 (GLOBE NEWSWIRE) - Altisource Residential Corporation (“Residential” or the “Company”) (NYSE: RESI) announced today financial and operating results for the third quarter of 2014. Net income for the third quarter of 2014 totaled $37.7 million, or $0.66 per diluted share, compared to net income of $13.7 million, or $0.53 per diluted share, for the third quarter of 2013.
Net income for the nine months ended September 30, 2014 totaled $147.4 million, or $2.62 per diluted share, compared to net income of $18.0 million, or $0.98 per diluted share, for the nine months ended September 30, 2013.
Residential also reported estimated taxable income of $38.7 million for the third quarter of 2014 compared to taxable income of $5.0 million for the third quarter of 2013 and $26.5 million for the second quarter of 2014.
Third quarter 2014 highlights:
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| • | Declared and paid a dividend of 0.55 per share, marking Residential’s fourth consecutive quarterly dividend increase. |
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| • | Generated strong estimated taxable income, up sequentially 46% over the second quarter of 2014. |
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| • | Completed the acquisition of 1,289 non-performing mortgage loans having an aggregate market value of underlying properties of $320.7 million. |
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| • | Completed its first non-performing loan securitization transaction, with gross proceeds of approximately $150.0 million. |
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| • | Resolved 1,510 loans, up 31% from the 1,156 loans resolved in the second quarter of 2014. |
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| • | Increased rental portfolio to 306 properties. |
Chairman William Erbey stated, “Residential is proud to generate continued attractive returns, resulting in the fourth increase in our quarterly dividend in the past 12 months.”
“We are pleased with our successful efforts in increasing loan resolutions by 31%, resulting in strong taxable income for the quarter,” said Chief Executive Officer Ashish Pandey.
Webcast and conference call
The Company will host a webcast and conference call on Tuesday, November 4, 2014, at 10:00 a.m. Eastern Time to discuss its financial results for the third quarter of 2014. The conference call will be webcast live over the internet from the Company’s website at www.altisourceresi.com and can be accessed by clicking on the “Shareholders” link.
About Residential
Residential is focused on providing affordable rental homes to families throughout the United States. It acquires single-family properties primarily through the purchase of distressed mortgage loan portfolios. Residential’s strategy is to work with borrowers to modify and refinance loans to keep them in their homes, and it expects to convert the majority of remaining loans into renovated rental properties. Additional information is available at www.altisourceresi.com.
Forward-looking statements
This press release contains forward-looking statements that involve a number of risks and uncertainties. Those forward-looking statements include all statements that are not historical fact, including statements about management’s beliefs and expectations. Forward-looking statements are based on management’s beliefs as well as assumptions made by and information currently available to management. Because such statements are based on expectations as to future economic performance and are not statements of historical fact, actual results may differ materially from those projected. Residential undertakes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to: Residential’s ability to implement its business plan; Residential’s ability to leverage strategic relationships on an efficient and cost-effective basis; its ability to compete; general economic and market conditions; governmental regulations, taxes and policies; availability of adequate and timely sources of liquidity and financing and other risks and uncertainties detailed in the “Forward-Looking Statements,” “Risk Factors” and other sections of Residential’s Registration Statement on Form 10, its Annual Report on Form 10-K, its quarterly reports on Form 10-Q and its other filings with the Securities and Exchange Commission.
Altisource Residential Corporation
Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)
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| | | | | | | | | | | | | | | |
| | Three months ended September 30, 2014 | | Three months ended September 30, 2013 | | Nine months ended September 30, 2014 | | Nine months ended September 30, 2013 |
| | | | | | | | |
| Revenues: | | | | | | | |
| Rental revenues | $ | 469 |
| | $ | 6 |
| | $ | 719 |
| | $ | 6 |
|
| Net unrealized gain on mortgage loans | 88,726 |
| | 17,670 |
| | 258,898 |
| | 25,963 |
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| Net realized gain on mortgage loans | 13,727 |
| | 1,909 |
| | 33,867 |
| | 4,015 |
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| Net realized gain on re-performing mortgage loans | 302 |
| | — |
| | 302 |
| | — |
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| Net realized gain on real estate | 3,310 |
| | — |
| | 4,544 |
| | — |
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| Interest income | 2,568 |
| | 156 |
| | 2,757 |
| | 368 |
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| Total revenues | 109,102 |
| | 19,741 |
| | 301,087 |
| | 30,352 |
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| Expenses: | | | | | | | |
| Residential property operating expenses | 9,247 |
| | 191 |
| | 13,550 |
| | 275 |
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| Real estate depreciation and amortization | 313 |
| | 4 |
| | 464 |
| | 4 |
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| Real estate selling costs and impairment | 5,542 |
| | 210 |
| | 8,775 |
| | 210 |
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| Mortgage loan servicing costs | 21,226 |
| | 2,154 |
| | 49,588 |
| | 3,788 |
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| Interest expense | 11,699 |
| | 467 |
| | 24,352 |
| | 1,163 |
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| General and administrative | 1,819 |
| | 980 |
| | 5,665 |
| | 2,480 |
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| Related party general and administrative | 21,530 |
| | 2,039 |
| | 51,629 |
| | 4,474 |
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| Total expenses | 71,376 |
| | 6,045 |
| | 154,023 |
| | 12,394 |
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| Other income (expense) | — |
| | 13 |
| | 383 |
| | (6 | ) |
| Income before income taxes | 37,726 |
| | 13,709 |
| | 147,447 |
| | 17,952 |
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| Income tax expense | 50 |
| | — |
| | 76 |
| | — |
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| Net income | $ | 37,676 |
| | $ | 13,709 |
| | $ | 147,371 |
| | $ | 17,952 |
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| | | | | | | | |
| Earnings per share of common stock – basic: | | | | | | | |
| Earnings per basic share | $ | 0.66 |
| | $ | 0.55 |
| | $ | 2.63 |
| | $ | 1.03 |
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| Weighted average common stock outstanding – basic | 57,174,150 |
| | 25,078,727 |
| | 55,930,010 |
| | 17,484,598 |
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| Earnings per share of common stock – diluted: | | | | | | | |
| Earnings per diluted share | $ | 0.66 |
| | $ | 0.53 |
| | $ | 2.62 |
| | $ | 0.98 |
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| Weighted average common stock outstanding – diluted | 57,406,325 |
| | 25,949,293 |
| | 56,312,104 |
| | 18,373,205 |
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| | | | | | | | |
| Dividends declared per common share | $ | 0.55 |
| | $ | 0.10 |
| | $ | 1.48 |
| | $ | 0.10 |
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Altisource Residential Corporation
Consolidated Balance Sheets
(In thousands, except share and per share amounts)
(Unaudited)
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| | September 30, 2014 | | December 31, 2013 |
| Assets: | | | |
| Real estate held for use: | | | |
| Land | $ | 9,865 |
| | $ | 478 |
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| Rental residential properties (net of accumulated depreciation of $482 and $24, respectively) | 38,470 |
| | 3,092 |
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| Real estate owned | 370,733 |
| | 32,332 |
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| Total real estate held for use, net | 419,068 |
| | 35,902 |
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| Real estate assets held for sale | 40,985 |
| | 1,186 |
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| Mortgage loans | 2,071,505 |
| | 1,207,163 |
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| Mortgage loans held for sale | 143,197 |
| | — |
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| Cash and cash equivalents | 76,027 |
| | 115,988 |
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| Restricted cash | 12,033 |
| | 5,878 |
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| Accounts receivable | 874 |
| | 1,428 |
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| Related party receivables | 19,254 |
| | 9,260 |
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| Investment in affiliate | 18,000 |
| | 18,000 |
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| Deferred leasing and financing costs, net | 3,688 |
| | 2,293 |
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| Prepaid expenses and other assets | 5,305 |
| | 1,542 |
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| Total assets | $ | 2,809,936 |
| | $ | 1,398,640 |
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| Liabilities: | | | |
| Repurchase agreements | $ | 1,258,329 |
| | $ | 602,382 |
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| Other secured borrowings (including $15,000 repurchase agreement with NewSource) | 165,000 |
| | — |
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| Accounts payable and accrued liabilities | 14,577 |
| | 4,952 |
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| Related party payables | 55,216 |
| | 5,879 |
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| Total liabilities | 1,493,122 |
| | 613,213 |
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| Commitments and contingencies |
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| Equity: | | | |
| Common stock, $.01 par value, 200,000,000 authorized shares; 57,186,587 and 42,286,669 shares issued and outstanding, at September 30, 2014 and December 31, 2013, respectively | 572 |
| | 423 |
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| Additional paid-in capital | 1,227,021 |
| | 758,584 |
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| Retained earnings | 89,221 |
| | 26,420 |
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| Total equity | 1,316,814 |
| | 785,427 |
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| Total liabilities and equity | $ | 2,809,936 |
| | $ | 1,398,640 |
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Non-GAAP measures - Estimated REIT taxable income
Estimated REIT taxable income is a measure that we use in connection with monitoring our compliance with certain REIT requirements. Estimated REIT taxable income should never be considered as an alternative to net income or net income per share as indicators of our operating performance.
The following table is a reconciliation of U.S. GAAP net income to estimated REIT taxable income (unaudited, $ in thousands):
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| | U.S. GAAP | | Adjustments(1) | | Tax |
| | Three months ended September 30, 2014 | | Three months ended September 30, 2014 | | Three months ended September 30, 2014 |
| Revenues: | | | | | |
| Rental revenues | $ | 469 |
| | $ | — |
| | $ | 469 |
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| Net unrealized gain on mortgage loans | 88,726 |
| | (20,559 | ) | | 68,167 |
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| Net realized gains | 17,339 |
| | (3,260 | ) | | 14,079 |
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| Interest income, advance recoveries and other | 2,568 |
| | 2,807 |
| | 5,375 |
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| Total revenues | 109,102 |
| | (21,012 | ) | | 88,090 |
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| Expenses: | | | | | |
| Residential property operating expenses including depreciation | 9,560 |
| | (1,244 | ) | | 8,316 |
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| Mortgage loan servicing costs | 21,226 |
| | (13,934 | ) | | 7,292 |
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| General, administrative and other | 40,590 |
| | (6,783 | ) | | 33,807 |
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| Total expenses | 71,376 |
| | (21,961 | ) | | 49,415 |
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| Estimated income before income taxes | $ | 37,726 |
| | $ | 949 |
| | $ | 38,675 |
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| | | | | | |
| | Nine months ended September 30, 2014 | | Nine months ended September 30, 2014 | | Nine months ended September 30, 2014 |
| Revenues: | | | | | |
| Rental revenues | $ | 719 |
| | $ | — |
| | $ | 719 |
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| Net unrealized gain on mortgage loans | 258,898 |
| | (107,468 | ) | | 151,430 |
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| Net realized gains | 38,713 |
| | (7,264 | ) | | 31,449 |
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| Interest income, advance recoveries and other | 2,757 |
| | 8,760 |
| | 11,517 |
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| Total revenues | 301,087 |
| | (105,972 | ) | | 195,115 |
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| Expenses: | | | | | |
| Residential property operating expenses including depreciation | 14,014 |
| | (1,997 | ) | | 12,017 |
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| Mortgage loan servicing costs | 49,588 |
| | (37,127 | ) | | 12,461 |
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| General, administrative and other | 90,038 |
| | (10,363 | ) | | 79,675 |
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| Total expenses | 153,640 |
| | (49,487 | ) | | 104,153 |
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| Estimated income before income taxes | $ | 147,447 |
| | $ | (56,485 | ) | | $ | 90,962 |
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(1) Adjustments between GAAP earnings and estimated taxable REIT income primarily represent temporary timing differences in the recognition of revenue and expense items, as provided above.
