Second Quarter 2003
Supplemental Financial Package
American Mortgage Acceptance Company (“AMAC”)
625 Madison Avenue
New York, NY 10022
Phone: 212-588-1765
Fax: 212-751-3550
Web Site: www.americanmortgageco.com
AMEX Symbol: AMC
Investor Contacts:
Stuart Rothstein
Chief Financial Officer
212-421-5333
Brenda Abuaf
Director of Shareholder Services
800-831-4826
Certain items in this document may constitute forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and as such may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performances or achievements of AMAC to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Such forward-looking statements speak only as of the date of this document. AMAC expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in AMAC’s expectations with regard thereto or change in events, conditions or circumstances on which any such statement is based.
Second Quarter 2003
Supplemental Financial Package | ||
Table of Contents | ||
Financial Highlights | 3 | |
Consolidated Balance Sheets | 4 | |
Consolidated Statements of Income | 5 | |
Capitalization as of Quarter-End | 6 | |
Dividend Yield | 7 | |
Portfolio Summary | 8 | |
Portfolio Distribution | 9 | |
Contingent Obligations | 10 | |
Acquisition Activity | 11-12 | |
Disposition/Payoff Activity | 13 |
Second Quarter 2003 Supplemental Financial Package |
Financial Highlights
Quarter Ended June 30, | % change | Six Months Ended June 30, | % change | |||||||||||||||||||
(Numbers in thousands, except per share data) | 2003 | 2002 | 2003 | 2002 | ||||||||||||||||||
Operating Data | ||||||||||||||||||||||
Revenues | $ | 3,303 | $ | 2,695 | 22.6 | % | $ | 7,536 | $ | 4,738 | 59.1 | % | ||||||||||
Net Income | 2,573 | 2,458 | 4.7 | % | 5,765 | 4,597 | 25.4 | % | ||||||||||||||
Per Share data: | ||||||||||||||||||||||
Net income per Diluted Share | $ | 0.32 | $ | 0.39 | -17.9 | % | $ | 0.79 | $ | 0.81 | -2.5 | % | ||||||||||
Dividends per Common Share | $ | 0.40 | $ | 0.38 | 5.3 | % | $ | 0.80 | $ | 0.74 | 8.1 | % | ||||||||||
Weighted Average Diluted Common Shares | 8,159 | 6,364 | 7,273 | 5,666 | ||||||||||||||||||
Ratios | ||||||||||||||||||||||
Interest Coverage | 5.0x | 9.0x | 6.5x | 8.9x | ||||||||||||||||||
Net Income Payout Ratio (per Diluted Share) | 126.8 | % | 97.1 | % | 100.9 | % | 90.9 | % | ||||||||||||||
Total Dividends Paid | $ | 3,335 | $ | 2,386 | $ | 5,881 | $ | 4,693 |
June 30, 2003 | June 30, 2002 | |||||||
Capitalization | ||||||||
(based on market value as of period-end) | ||||||||
Total Debt | 123,377 | 61,451 | ||||||
Common Equity | 144,751 | 85,273 | ||||||
Total Capitalization | $ | 268,128 | $ | 146,724 | ||||
Total Assets | $ | 258,893 | $ | 152,339 | ||||
Total Debt to Total Assets | 47.7 | % | 40.3 | % | ||||
Total Debt to Total Market Capitalization | 46.0 | % | 41.9 | % | ||||
Total Common Shares Outstanding | 8,338 | 6,364 | ||||||
Share Price at Period-End | $ | 17.36 | $ | 13.40 |
Second Quarter 2003
Supplemental Financial Package
Consolidated Balance Sheets
(Dollars in thousands) | ||||||||||||
June 30, 2003 | March 31, 2003 | June 30, 2002 | ||||||||||
Assets | ||||||||||||
Investments in debt securities | $ | 157,688 | $ | 115,773 | $ | 79,990 | ||||||
Investments in mortgage loans, net | 15,581 | 12,367 | 20,061 | |||||||||
Investment in ARCap | 20,240 | 20,240 | 20,241 | |||||||||
Real estate owned | 7,844 | 7,920 | — | |||||||||
Cash, cash equivalents | 3,406 | 3,645 | 11,116 | |||||||||
Restricted cash | 8,282 | 8,282 | — | |||||||||
Notes receivable | 43,401 | 42,442 | 19,617 | |||||||||
Other assets | 2,451 | 2,137 | 1,314 | |||||||||
Total assets | $ | 258,893 | $ | 212,806 | $ | 152,339 | ||||||
Liabilities | ||||||||||||
Repurchase facility payable | $ | 105,717 | $ | 93,565 | $ | 61,451 | ||||||
Warehouse facility payable | 17,660 | 16,997 | — | |||||||||
Interest rate hedges | 1,234 | 393 | — | |||||||||
Accrued interest payable | 292 | 187 | 44 | |||||||||
Accounts payable and accrued expenses | 459 | 350 | 506 | |||||||||
Due to Advisor and affiliates | 655 | 611 | 464 | |||||||||
Distributions payable | 3,335 | 2,545 | 2,386 | |||||||||
Total liabilities | 129,352 | 114,648 | 64,851 | |||||||||
Shareholders' Equity | ||||||||||||
Shares of beneficial interest | 871 | 674 | 674 | |||||||||
Treasury shares of beneficial interest | (38 | ) | (38 | ) | (38 | ) | ||||||
Additional paid-in capital | 126,746 | 99,470 | 99,487 | |||||||||
Distributions in excess of net income | (14,587 | ) | (13,824 | ) | (14,601 | ) | ||||||
Accumulated other comprehensive income | 16,549 | 11,876 | 1,966 | |||||||||
Total shareholders’ equity | 129,541 | 98,158 | 87,488 | |||||||||
Total liabilities and shareholders’ equity | $ | 258,893 | $ | 212,806 | $ | 152,339 | ||||||
Second Quarter 2003 Supplemental Financial Package |
Consolidated Statements of Income
(Dollars in thousands, except per share data)
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||||
2003 | 2002 | 2003 | 2002 | ||||||||||
Revenues: | |||||||||||||
Interest Income: | |||||||||||||
Debt securities | $ | 1,980 | $ | 1,370 | $ | 3,852 | $ | 2,454 | |||||
Mortgage loans | 356 | 609 | 1,763 | 1,010 | |||||||||
Notes receivable | 878 | 627 | 1,796 | 1,114 | |||||||||
Temporary investments | 7 | 13 | 15 | 24 | |||||||||
Other income | 82 | 76 | 110 | 136 | |||||||||
Total revenues | 3,303 | 2,695 | 7,536 | 4,738 | |||||||||
Expenses: | |||||||||||||
Interest | 643 | 307 | 1,050 | 579 | |||||||||
General and administrative | 182 | 164 | 425 | 284 | |||||||||
Fees to Advisor | 456 | 371 | 899 | 728 | |||||||||
FNMA loan program | — | 3 | — | 358 | |||||||||
Amortization and other | 49 | — | 206 | 6 | |||||||||
Total expenses | 1,330 | 845 | 2,580 | 1,955 | |||||||||
Other gain: | |||||||||||||
Equity in earnings of ARCap | 600 | 608 | 1,200 | 1,200 | |||||||||
Net gain (loss) on repayments and sales of | |||||||||||||
Debt securities | — | — | (391 | ) | 614 | ||||||||
Net income | $ | 2,573 | $ | 2,458 | $ | 5,765 | $ | 4,597 | |||||
Net income per share | |||||||||||||
Basic | $ | 0.32 | $ | 0.39 | $ | 0.79 | $ | 0.81 | |||||
Diluted | $ | 0.32 | $ | 0.39 | $ | 0.79 | $ | 0.81 | |||||
Weighted average shares outstanding | |||||||||||||
Basic | 8,144 | 6,364 | 7,259 | 5,666 | |||||||||
Diluted | 8,159 | 6,364 | 7,273 | 5,666 | |||||||||
Second Quarter 2003 Supplemental Financial Package |
Capitalization as of Quarter-End
(Dollars in thousands, except per share data)
Equity
Description | Shares Outstanding | Quarter-End Price | Market Value | |||||
Common Stock | 8,338,180 | $ | 17.36 | $ | 144,751 |
(Dollars in thousands)
Debt
Description | Program | Interest Rate1 (at June 30, 2003) | Outstanding Balance | |||||
Repurchase Facility Payable | Repo2 | 1.8 | %3 | $ | 105,717 | |||
Warehouse Facility Payable | Fleet Credit Facility | 3.44 | 17,660 | |||||
Total/Weighted Average | 2.0 | % | $ | 123,377 | ||||
Total Market Capitalization
Balance | % of Total | |||||
Equity | ||||||
Common | $ | 144,751 | 54.0 | % | ||
Debt | ||||||
Working Capital Repurchase Facility | 105,717 | 39.4 | ||||
Warehouse Credit Facility | 17,660 | 6.6 | ||||
Total Debt | 123,377 | 46.0 | ||||
Total Market Capitalization | $ | 268,128 | 100.0 | % | ||
Notes:
1. | Weighted average interest rate of each borrowing at June 30, 2003. |
2. | On March 25, 2003, the Company entered into a five-year interest rate swap. The Company is required to pay Fleet National Bank a fixed rate of 3.48% on a notional amount of $30 million and, in return, will receive a floating rate equivalent to 30-day LIBOR. |
3. | Interest rate on the repurchase facility is based on a two basis point spread above 30-day LIBOR for both GNMA and FNMA collateral. The interest rate shown is the weighted average between the actual rate paid on the floating rate debt outstanding on the repo facility and the rate paid on the $30 million in debt that has been fixed through the above noted swap with Fleet National Bank. |
4. | Interest rate on the Fleet Credit Facility is based on a 200 basis point spread above one-to-six-month LIBOR, at the Company’s option. |
Second Quarter 2003
Supplemental Financial Package
Dividend Yield
For Quarter | Annualized | End of Period Share Price | Yield on Period- End Share Price | |||||||||
1999 Dividend | — | $ | 1.45 | $ | 8.88 | 16.3 | % | |||||
2000 Dividend | — | $ | 1.45 | $ | 7.94 | 18.3 | % | |||||
2001 Dividend | — | $ | 1.45 | $ | 14.55 | 10.0 | % | |||||
2002 Dividend | — | $ | 1.51 | $ | 14.09 | 10.7 | % | |||||
1Q 2003 Dividend | $ | 0.4000 | $ | 1.60 | $ | 15.73 | 10.2 | % | ||||
2Q 2003 Dividend | $ | 0.4000 | $ | 1.60 | $ | 17.36 | 9.2 | % |
Second Quarter 2003 | ||
Supplemental Financial Package |
Portfolio Summary
Investments/Asset Type | Outstanding Principal at 6/30/2003 | Fully- Funded Principal Balance | Fair Value/ Carrying Amount1 | Weighted Average Stated Interest Rate2 | Weighted Average Expected Maturity3 (in years) | |||||||||
(Dollars in thousands) | ||||||||||||||
First Mortgage Loans | $ | 2,781 | $ | 2,853 | $ | 2,777 | 11.3 | % | 0.5 | |||||
Participating Mezzanine Loans | 12,266 | 13,165 | 11,263 | 10.2 | 4 | 9.3 | ||||||||
Variable Rate Mezzanine Loans | 1,541 | 1,541 | 1,541 | 6.0 | 5 | 1.1 | ||||||||
GNMA Certificates | 106,342 | 126,688 | 124,897 | 7.2 | 10.3 | |||||||||
FNMA Certificates | 33,563 | 32,108 | 32,791 | 5.5 | 14.3 | |||||||||
ARCap Preferred Shares | 20,0006 | 20,0006 | 20,240 | 12.0 | N/A | |||||||||
Real Estate Owned7 | N/A | N/A | 7,782 | N/A | N/A | |||||||||
Bridge Loans | 21,498 | 23,999 | 21,375 | 11.8 | 1.1 | |||||||||
Variable Rate Bridge Loans | 22,158 | 24,392 | 22,026 | 5.7 | 5 | 1.4 | ||||||||
Total/Weighted Average—All investments | $ | 220,149 | $ | 244,746 | $ | 244,692 | 7.8 | % | 8.6 | |||||
Notes:
1. | First mortgages, mezzanine loans and bridge loans are carried at cost, net of unamortized loan origination costs and fees. GNMA and FNMA certificates are carried at fair value, which is based on market prices obtained from independent sources. ARCap is carried at cost plus any declared, unpaid dividend. |
2. | Weighted average stated interest rate is calculated based on the fully funded amount of each individual loan within each investment/asset type as of 6/30/03. |
3. | Weighted average expected maturity is calculated based on the earlier of the maturity date of a loan or the earliest date that a loan can be repaid without penalty. |
4. | Weighted average yield on mezzanine loans, not including participation. Interest rate is based on a fixed percentage on the first mortgage loan. |
5. | These loans are variable rate debt obligations with the interest rate calculated based on a spread over 30-day LIBOR. |
6. | 800,000 shares at original per share price of $25.00. |
7. | A 132-unit multifamily housing apartment complex located in La Porte, Texas. |
Second Quarter 2003 | ||
Supplemental Financial Package Q2 2002 |
Portfolio Distribution
By Investment Type1 | Geographic Diversification by State2 | |
Notes:
1. | Percentage is calculated based on fair value/carrying amount of each loan type as of June 30, 2003. |
2. | Percentage is calculated based on the carrying amount of loans; investment in ARCap is not included. |
Second Quarter 2003 Supplemental Financial Package |
Contingent Obligations
Standby Loan Commitments
The company issues standby permanent loan commitments for the construction or rehabilitation of multifamily apartment complexes. In return, the company receives a fee for issuing these commitments.
Permanent Loans
Issue Date | Project | Location | No. of Apt. Units | Amount | Loan Commitment Fee | Loan | Commitment Expiration | |||||||||
March-02 | Sunset Gardens | Eagle Pass, TX | 60 | $ | 717,000 | 3.49 | % | N/A | September 2003 | |||||||
August-02 | Highland Park | Topeka, KS | 200 | 4,250,000 | 2.00 | % | 1.00%, if funded | December 2003 | ||||||||
Total Standby Permanent Loan Commitments | 260 | $ | 4,967,000 | |||||||||||||
Guaranteed Construction Loans
The Company provides credit support for the following projects after construction completion, up until the date in which permanent financing takes place.
Date Closed | Project | Location | No. of Units | Amount | Loan Administration Fee (annualized rate)1 | Construction Guarantee Fee2 | Expected Expiration of Guarantee | ||||||||||
September-02 | Creekside Apts. | Colorado Springs, CO | 144 | $ | 7,500,000 | 0.375 | % | — | October 2003 | ||||||||
July-02 | Clark's Crossing | Laredo, TX | 160 | 4,790,000 | 0.500 | % | 0.625 | % | October 2003 | ||||||||
October-02 | Village at Meadowbend | Temple, TX | 138 | 3,675,000 | 0.500 | % | 0.750 | % | February 2004 | ||||||||
November-02 | Mapleview Apartments | Saginaw, MI | 104 | 3,240,000 | 0.625 | % | 0.247 | % | July 2004 | ||||||||
Total Guaranteed Construction Loans | 546 | $ | 19,205,000 | ||||||||||||||
Notes:
1. | Loan Administration Fee is paid monthly based on the annualized rate divided by twelve during the guarantee period. |
2. | Construction Guarantee Fee is an up-front fee—paid at closing. |
Second Quarter 2003
Supplemental Financial Package
Acquisition Activity
Acquisitions | Location | Units | Date | Face Amount of | Amount Funded | Interest Rate | Final | Prepayment | ||||||||
Mortgage Loans | ||||||||||||||||
Desert View | Coolidge, AZ | 45 | 4/4/2003 | $1,011,000 | $1,011,000 | 11.00% | Apr 2004 | N/A | ||||||||
Mezzanine Loans | ||||||||||||||||
Villas at Highpointe (Note A) | North Little Rock, AR | 304 | 4/22/2003 | 2,600,000 | 2,363,808 | 14.57% | Apr 2033 | Apr 2013 | ||||||||
Villas at Highpointe (Note B) | North Little Rock, AR | * | 4/22/2003 | 693,000 | — | 23.76% | Apr 2033 | Apr 2013 | ||||||||
Total/Weighted Average | 304 | 3,293,000 | 2,363,808 | 16.50% | Apr 2013 | |||||||||||
FannieMae DUS Bonds | Settlement | Original | Total | |||||||||||||
Allegro | Minneapolis, MN | N/A | 6/30/2003 | 2,567,000 | 2,587,055 | 5.38% | Jul 2033 | Dec 2012 | ||||||||
Bay Forest | Annapolis, MD | N/A | 4/21/2003 | 3,883,662 | 4,347,364 | 7.43% | Oct 2028 | Nov 2014 | ||||||||
Cambridge | Cambridge, MA | N/A | 4/11/2003 | 3,600,000 | 3,699,563 | 5.56% | Mar 2033 | Mar 2018 | ||||||||
Coventry Place | Shreveport, LA | N/A | 5/9/2003 | 725,000 | 796,561 | 6.48% | Mar 2032 | Mar 2017 | ||||||||
30 West Apts. | Norwalk, CT | N/A | 5/27/2003 | 1,290,000 | 1,379,249 | 6.08% | Oct 2016 | Oct 2013 | ||||||||
Sultana | Temple City, CA | N/A | 6/30/2003 | 4,120,000 | 4,131,588 | 4.65% | Jun 2023 | Dec 2022 | ||||||||
Village West | Stockton, CA | N/A | 6/30/2003 | 779,000 | 791,659 | 4.91% | Jun 2021 | May 2018 | ||||||||
Courtwood | Woodland, CA | N/A | 6/26/2003 | 1,750,000 | 1,777,344 | 4.69% | Jun 2033 | Jun 2018 | ||||||||
Rancho De Cieto | Brownsville, TX | N/A | 5/13/2003 | 2,343,000 | 2,633,456 | 6.33% | Sep 2017 | Mar 2017 | ||||||||
Buena | Torrance, CA | N/A | 6/30/2003 | 3,000,000 | 3,074,531 | 4.83% | Jun 2033 | Jun 2018 | ||||||||
Elmwood Gardens | Mesquite, TX | N/A | 5/15/2003 | 5,500,000 | 5,584,219 | 5.35% | May 2033 | May 2018 | ||||||||
Jackson Park | Le Mesa, CA | N/A | 5/30/2003 | 2,750,000 | 2,794,688 | 5.15% | Jun 2018 | Dec 2017 | ||||||||
Total/Weighted Average | N/A | 32,307,662 | 33,597,277 | 5.55% | Dec 2013 | |||||||||||
Bridge Loans | ||||||||||||||||
Valley View | North Little Rock, AR | * | 5/1/2003 | 400,000 | 400,000 | 12.00% | Dec 2003 | N/A |
Second Quarter 2003 Supplemental Financial Package |
Acquisition Activity (continued)
Acquisitions | Location | Units | Date Originated/ Acquired | Face Amount of Loan | Amount Funded at Close | Interest Rate | Final Maturity | Prepayment | ||||||||||
Price1 | Price1 | |||||||||||||||||
Real Estate | ||||||||||||||||||
Plaza at San Jacinto | La Porte, TX | 132 | 5/6/2003 | 6,670,000 | 6,670,000 | |||||||||||||
Total Q2 2003 Acquisitions | $ | 43,681,662 | $ | 44,042,085 | ||||||||||||||
Total Q1 2003 Acquisitions | $ | 19,562,228 | $ | 18,858,228 | ||||||||||||||
Total YTD Acquisitions | $ | 63,243,890 | $ | 62,900,313 | ||||||||||||||
Notes:
N/A = Loan can be prepaid without penalty.
* Not applicable to avoid duplication.
1. Price reflects amounts paid to purchase first mortgage, which was foreclosed upon, and at which time AMAC took possession of the property. AMAC had a mezzanine loan of $1.25 million, bringing our investment in Real Estate owned to $7.92 million.
Second Quarter 2003 Supplemental Financial Package |
Disposition/Payoff Activity
Loan Dispositions | Location | Units | Type | Face Amount of Loan at Payoff | Permanent Interest Rate | Realized Gains/ (Losses) | ||||||||||
GNMA Certificates | ||||||||||||||||
Copper Commons | N/A | N/A | Payoff | $ | 2,205,400 | 8.50 | % | — | ||||||||
Total Q2 2003 Disposition/Payoffs | $ | 2,205,400 | $ | — | ||||||||||||
Total Q1 2003 Disposition/Payoffs | $ | 18,686,399 | $ | (391,078 | ) | |||||||||||
Total YTD Disposition/Payoffs | $ | 20,891,799 | $ | (391,078 | ) | |||||||||||