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, November 15, 2005 - Ameritrans Capital Corporation
(NASDAQ: AMTC, AMTCP, AMTCW) today reported financial results for the
quarter ended September 30, 2005. For the Company's first fiscal quarter,
total investment income was flat at $1.281 million compared to $1.281
million during the prior comparable period. Interest income increased by
$20,726 over the comparable prior period, while fees and other income decreased
by $18,239. Leasing income decreased by $2,069 over the comparable period.
Ameritrans reported a net loss of ($75,431) available to common shareholders
for the first quarter of fiscal year 2006 or ($0.03) versus a net profit of
$337 or $0.00 per basic and diluted common share for the same period of fiscal
year 2005. On an operating basis, before payment of the Company's preferred
stock dividends, but after provisions for income tax, the Company reported an
operating profit of $8,944 for the quarter ended September 30, 2005 compared
to an operating profit of $84,612 during the quarter ended September 30, 2004.
The Company's net loan portfolio at September 30, 2005 was $51.4 million versus
$47.7 million at September 30, 2004.
Commenting on the results, Gary C. Granoff, Ameritrans' president said, "During
the first fiscal quarter September 30, 2005, our earnings were negatively
impacted by an increase in our interest expense of $157,117 over our interest
expense for the first quarter ended September 30, 2004. In addition other
administrative expenses increased by $36,321 during the quarter ended
September 30, 2005 as compared to the quarter ended September 30, 2004.
In comparing the two quarters we were positively impacted during the quarter
ended September 30, 2005 by a reduction in professional fees of $65,752, and
we were positively impacted by a reduction in write off and depreciation on
interest and loans receivable of $65,670."
Granoff further stated "We are continuing to take measures to build our loan
portfolio on a conservative but profitable basis which should have a beneficial
effect by increasing our gross income as transactions are completed.
Our new loans in the diversified business loan area are being done on an
adjustable basis so that periodically (quarterly, semi-annually or annually,
depending on the terms of the respective transactions) we will be adjusting
the interest rate payable by the borrower to current market rates. Our
margins have been decreased by the numerous increases in short term market
rates of interest charged by our banks. To partially offset anticipated
future increases in short term interest rates, the Company recently completed
two separate $5,000,000 interest rate swaps to lock in rates of 6.20% for a
two year period and 6.23% for a three year period starting from mid
October, 2005. The interest rate swaps should assist the Company in
controlling its interest costs on the floating portion of its bank debt
against continued upward increases in interest rates."
Granoff added: "Our Chicago taxi medallion loan portfolio has continued to
improve, and the Chicago taxi industry has stabilized. Our lending
operations in Chicago have continued to produce new loan activity.
In addition, during the quarter ended September 30, 2005, we were able to
complete closings on the sale of nineteen (19) medallions being foreclosed
in our Chicago taxi medallion loan portfolio that were pending at
June 30, 2005. During the quarter we were also able to execute contracts with
two purchasers to sell an additional eleven (11) foreclosed Chicago medallions.
Presently, we are negotiating the sale of an additional six (6) Chicago
medallions being foreclosed, and we anticipate that we may be able to complete
these transactions totaling sales of seventeen (17) foreclosed medallions by
the end of January 2006. If we are able to complete the sale of
seventeen (17) medallions then the sales of all medallions being foreclosed
by the Company in Chicago at September 30, 2005 will have been completed."
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
September 30, 2005 (Unaudited) and June 30, 2005
ASSETS
September 30, 2005 June 30, 2005
Loans receivable $51,503,498 $52,060,254
Less: unrealized
depreciation on
loans receivable (150,000) (150,000)
Loans receivable, net 51,353,498 51,910,254
Cash and cash equivalents 634,524 327,793
Accrued interest receivable, net
of unrealized depreciation of
$92,000 and $30,500, respectively 677,981 756,701
Assets acquired in satisfaction
of loans 384,528 384,528
Receivables from debtors on sales of
assets acquired in satisfaction
of loans 414,475 455,184
Equity securities 857,364 908,457
Furniture, equipment and leasehold
improvements, net 312,957 329,573
Medallions Under Lease 2,224,701 2,282,201
Prepaid expenses and other assets 543,462 531,904
TOTAL ASSETS $57,403,490 $57,886.595
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
September 30, 2005 (Unaudited) and June 30, 2005
LIABILITIES AND STOCKHOLDERS' EQUITY
September 30,2005 June 30, 2005
LIABILITIES
Debentures payable to SBA $12,000,000 $12,000,000
Notes payable, banks 29,650,652 29,770,652
Accrued expenses and other
liabilities 497,786 604,942
Accrued interest payable 126,860 256,285
Dividends payable 84,375 84,375
TOTAL LIABILITIES 42,359,673 42,716,254
COMMITMENTS AND CONTINGENCIES
(Notes 3,4 and 5)
STOCKHOLDERS' EQUITY
Preferred stock 500,000
shares authorized, none issued
or outstanding - -
9 3/8% cumulative participating
callable 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 (2,202,565) (2,127,134)
Accumulated other
comprehensive loss (153,368) (102,275)
15,113,817 15,240,341
Less: Treasury stock, at cost,
10,000 shares of common stock (70,000) (70,000)
TOTAL STOCKHOLDERS' EQUITY 15,043,817 15,170,341
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $57,403,490 $57,886,595
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended September 30, 2005 and 2004
(Unaudited)
Three Months Three Months
Ended Ended
Sept 30, Sept 30,
2005 2004
INVESTMENT INCOME
Interest on loans receivable $1,149,783 $1,129,057
Fees and other income 82,301 100,540
Leasing income 49,468 51,537
TOTAL INVESTMENT INCOME 1,281,552 1,281,134
OPERATING EXPENSES
Interest 539,273 382,156
Salaries and employee benefits 276,238 262,664
Occupancy costs 54,716 49,183
Professional fees 69,812 135,564
Other administrative expenses 281,789 245,468
Loss and impairments on
assets acquired in
satisfaction of loans, net 3,000 10,393
Foreclosure expenses 2,208 5,000
Write off and depreciation
on interest and loans
receivable 35,848 101,518
TOTAL OPERATING EXPENSES 1,262,884 1,191,946
OPERATING INCOME 18,668 89,188
OTHER EXPENSE
Equity in loss of investee - (2,011)
TOTAL OTHER EXPENSE - (2,011)
INCOME BEFORE PROVISION
FOR INCOME TAXES 18,668 87,177
PROVISION FOR INCOME TAXES 9,724 2,465
NET INCOME $ 8,944 $ 84,712
DIVIDENDS ON PREFERRED STOCK $ (84,375) $ (84,375)
NET (LOSS) INCOME AVAILABLE TO
COMMON SHAREHOLDERS $ (75,431) $ 337
WEIGHTED AVERAGE SHARES OUTSTANDING
- Basic 2,035,600 2,035,600
- Diluted 2,035,600 2,035,600
NET LOSS PER COMMON SHARE
- Basic $ (0.03) $ (0.00)
- Diluted $ (0.03) $ (0.00)