From:
Ameritrans Capital Corporation
For More Information Contact:
Gary Granoff
1-(800)-214-1047
For Immediate Release
Ameritrans Reports Fourth Quarter and Fiscal Year June 30, 2005 Results
New York, NY, September 29, 2005 - Ameritrans Capital Corporation
(NASDAQ: AMTC, AMTCP) today reported financial results for the fiscal year and
quarter ended June 30, 2005. For the quarter ended June 30, 2005, investment
income was $2.19 million compared to $1.34 million during the prior comparable
period. Investment income for the quarter ended June 30, 2005 included interest
income, fee income and leasing income totaling $1,451,111 and net gain on sale
of securities of $738,874 totaling to $2.19 million.
For the fiscal year ended June 30, 2005, Ameritrans reported investment income
of $6.13 million as compared to $5.63 million for the prior year. The increase
in reported investment income for fiscal year ending June 30, 2005 is
attributable primarily to the result of an increase in the net gain on the sale
of securities of $688,874 for the fiscal year. Interest income, fee income and
leasing income totaled $5,443,192 during fiscal year ended June 30, 2005 as
compared to $5,633,827 for fiscal year ended June 30, 2004. The reduction in
interest income, fee income and leasing income was primarily due to a reduction
in interest income of $423,787 due to the impact of lower average interest
rates charged on new and modified loans, partially offset by an increase in
other fees of $141,039 and leasing income of $92,113.
Ameritrans reported a net income available to common shareholders for the
quarter ended June 30, 2005 of $200,627, or $0.09 per basic and diluted common
share, versus a net loss of ($87,721), or ($0.04) per basic and diluted common
share, in the fourth quarter of fiscal 2004. The increase in the net income
for the year ended June 30, 2005 was attributable primarily to a gain on the
sale of securities of $688,874. For the fiscal year ended June 30, 2005,
Ameritrans reported a net loss to common shareholders of ($224,726), or ($0.11)
per basic and diluted common share, versus net loss of ($704,683) or ($0.35)
per basic and diluted common share for fiscal year 2004. The net loss to
common shareholders in fiscal years ended June 30, 2005 and June 30, 2004
was calculated after taking into account payment of preferred dividends to
preferred shareholders of $337,500 in each fiscal year.
Operating income in the fourth quarter of fiscal year ended June 30, 2005 was
$285,289 as compared to operating income in the fourth quarter of fiscal year
ended June 30, 2004 of $2,647.
The Company's loan portfolio at June 30, 2005 was $51.9 million versus $49.4
million at June 30, 2004.
<page>
President of Ameritrans, Gary C. Granoff stated, "Financial results during 2005
were positively impacted by the gain on sale of securities during the fourth
quarter of 2005. During the first six months of fiscal year ending
June 30, 2005, the Company's operating income (loss) was $87,177 for the first
fiscal quarter and ($326,432) for the second fiscal quarter. For the second
half of the fiscal year, the Company's third fiscal quarter operating income
was $41,808 and its fourth fiscal quarter operating income was $285,289. The
improvement in operating income primarily resulted from reductions in write off
and depreciation on interest receivable of $ 295,535, as well as a reduction in
foreclosure expenses of $275,176 added to net gain on sale of securities of
$688,874 and increase of fee income of $141,039 partially offset by reductions
in interest income of $423,787 and increases in interest expense of $394,217."
Granoff went on to say: "During the fiscal year we made substantial progress in
our Chicago taxi portfolio by selling 13 foreclosed medallions and executing
contracts of sale to sell 5 of our leased medallions, and 20 additional
foreclosed medallions. Closings on 20 of the medallions under contract of sale
at June 30, 2005 took place on August 31, 2005. The number of foreclosed
medallions in Chicago has stabilized and at the present time we have
approximately 15 additional foreclosed medallions to sell, with active
discussions taking place at this time with potential buyers. We believe that
the Chicago taxi market and the local economy have improved which in turn has
improved our current business and prospects for future business in that market.
At August 31, 2005, the balance of our medallion loans in New York, Boston and
Miami are operating without any loans being in excess of 90 days delinquent and
without any foreclosures in any of those markets. Our commercial loan
portfolio is also performing well at the present time and we are continuing to
build that portfolio with all new loans being made with adjustable interest
rate terms. We also will continue to seek favorable equity investment
transactions to augment our loan activity. During the fiscal year ended
June 30, 2005 the equity investment in a hotel in Arlington, Virginia was
liquidated, resulting in a positive impact on our financial results for
the year."
Ameritrans Capital Corporation is a specialty finance company engaged in
making loans to, and investments in, small businesses. Ameritrans'
wholly-owned subsidiary, Elk Associates Funding Corporation, has been
licensed by the United Stated Small Business Administration (the "SBA") as
a Small Business Investment Company since 1980. The company maintains its
offices at 747 Third Avenue, 4th Floor, New York, NY, 10017.
# # #
This announcement contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
statements are subject to certain risks and uncertainties that could
cause actual results to differ materially from those presently anticipated or
projected. Ameritrans Capital Corporation cautions investors not to place
undue reliance on forward-looking statements, which speak only as to
management's expectations on this date.
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
- --------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEETS
June 30, 2005 and 2004
- --------------------------------------------------------------------------------
2005 2004
---------------- ----------------
ASSETS
- ------
Loans receivable $ 52,060,254 $ 49,900,989
Less unrealized depreciation on loans receivable (150,000) (509,770)
---------------- ----------------
Loans receivable, net 51,910,254 49,391,219
Cash and cash equivalents 327,793 416,600
Accrued interest receivable, net of unrealized depreciation
of $59,000 in 2005 and $30,500 in 2004 756,701 969,912
Assets acquired in satisfaction of loans 384,528 1,421,723
Receivables from debtors on sales of assets acquired in satisfaction of loan 455,184 422,158
Equity securities 908,457 1,038,617
Furniture, equipment and leasehold improvements, net 329,573 439,262
Medallions under lease 2,282,201 2,382,201
Prepaid expenses and other assets 531,904 610,214
---------------- ----------------
Total assets (Note 8) $ 57,886,595 $ 57,091,906
================ ================
- --------------------------------------------------------------------------------
(Continued)
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
- --------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEETS (Continued)
June 30, 2005 and 2004
- --------------------------------------------------------------------------------
2005 2004
---------- ----------
Liabilities and Stockholders' Equity
- ------------------------------------
Liabilities:
Debentures payable to SBA $ 12,000,000 $ 12,000,000
Notes payable, bank 29,770,652 28,908,652
Accrued expenses and other liabilities 604,942 578,790
Accrued interest payable 256,285 271,630
Dividends payable 84,375 84,375
---------- ----------
Total liabilities 42,716,254 41,843,447
---------- ----------
Commitments and Contingencies
Stockholders' Equity:
Preferred stock 500,000 shares authorized, none issued or outstanding - -
9-3/8% cumulative participating redeemable preferred stock $.01 par
value, $12.00 face value, 500,000 shares authorized; 300,000 shares
issued and outstanding 3,600,000 3,600,000
Common stock, $.0001 par value; 5,000,000 shares authorized, 2,045,600
shares issued, 2,035,600 outstanding 205 205
Additional paid-in capital 13,869,545 13,869,545
Accumulated deficit (2,127,134) (1,902,408)
Accumulated other comprehensive loss (102,275) (248,883)
---------- ----------
Total 15,240,341 15,318,459
Less: Treasury stock, at cost, 10,000 shares
of common stock (70,000) (70,000)
---------- ----------
Total stockholders' equity 15,170,341 15,248,459
Total liabilities and stockholders' equity $ 57,886,595 $ 57,091,906
================ ================
- --------------------------------------------------------------------------------
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended June 30, 2005, 2004 and 2003
- --------------------------------------------------------------------------------
2005 2004 2003
--------- --------- ---------
Investment Income:
Interest on loans receivable $ 4,771,954 $ 5,195,741 $ 6,072,399
Gain on sale of equity securities, net (Note 4) 688,874 5,665 2,976
Fees and other income 459,598 318,559 209,680
Leasing income
211,640 119,527 -
--------- --------- ---------
Total investment income 6,132,066 5,639,492 6,285,055
--------- --------- ---------
Operating Expenses:
Interest 1,837,633 1,443,416 2,076,861
Salaries and employee benefits 1,128,963 1,022,964 879,074
Occupancy costs 188,466 207,079 144,279
Professional fees 675,399 605,168 575,022
Other administrative expenses 1,162,457 1,250,435 963,175
Loss and impairments on both medallions under lease and
assets acquired in satisfaction of loans, net 198,177 44,362 77,343
Foreclosure expenses 87,695 362,871 313,678
Write off and depreciation on interest and loans receivable 728,710 1,024,245 852,512
--------- --------- ---------
Total operating expenses 6,007,500 5,960,540 5,881,944
--------- --------- ---------
Operating income (loss) 124,566 (321,048) 403,111
--------- --------- ---------
Other Expense:
Equity in loss of investee (Note 4) (4,021) (29,634) -
Loss on sale of automobile (60) - -
--------- --------- ---------
Total other expense (4,081) (29,634) -
--------- --------- ---------
Income (loss) before income taxes 120,485 (350,682) 403,111
Income Taxes 7,711 16,501 7,897
--------- --------- ---------
Net income (loss) 112,774 367,183 395,214
Dividends on preferred stock (337,500) (337,500) (337,500)
--------- --------- ----------
Net income (loss) available to common shareholders $ (224,726) $ (704,683) $ 57,714
============= ============= ==============
Weighted Average Number of Common Shares Outstanding
Basic 2,035,600 2,035,600 2,035,600
============= ============= ==============
Diluted 2,035,600 2,035,600 2,035,600
============= ============= ==============
Net (Loss) Income Per Common Share
Basic $ (0.11) $ (0.35) $ 0.03
============= ============= =============
Diluted $ (0.11) $ (0.35) $ 0.03
============= ============= =============
2005 2004 2003
----------- ----------- -------------
Net income (loss) $ 112,774 $ (367,183) $ 395,214
Other comprehensive income (loss)
Unrealized gain (loss) on equity securities arising
during the period 46,583 (13,338) (200,338)
Reclassification adjustment for (gain) loss included
in net income (loss) 100,025 (5,665) -
----------- ----------- -------------
Total comprehensive income (loss) $ 259,382 $ (386,186) $ 194,876
=========== =========== =============