For Immediate Release
FROM:
Ameritrans Capital Corporation
For more information Contact:
Gary Granoff
(800) 214-1047
AMERITRANS REPORTS SECOND QUARTER FISCAL 2006 RESULTS
New York, NY, February 15, 2006 - Ameritrans Capital Corporation (NASDAQ: AMTC,
AMTCP, AMTCW) today reported financial results for the quarter ended December
31, 2005. Ameritrans reported a net loss of ($131,762) available to common
shareholders for the second quarter of fiscal year 2006 or ($0.06) versus a net
loss of ($411,615) or ($0.20) 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 loss of ($47,387) for the quarter ended December
31, 2005, compared to an operating loss of ($327,240) during the quarter ended
December 31, 2004.
For the Company's second fiscal quarter, total investment income was $1.356
million compared to $1.267 million during the prior comparable period. Interest
income increased by $87,014 over the comparable prior period, while fees and
other income decreased by $20,038. Leasing income decreased by $27,527 over the
comparable period.
The Company's net loan portfolio at December 31, 2005 was $50.5 million versus
$51.9 million at December 31, 2004.
Commenting on the results, Gary C. Granoff, Ameritrans' president said, "During
the second fiscal quarter December 31, 2005, our earnings were negatively
impacted by an increase in our interest expense of $144,781 compared to our
interest expense for the second quarter ended December 31, 2004. However, the
December 2005 quarter results show savings over the December 2004 quarter
results which positively impacted our earnings in the following areas: salaries
and employee benefits were reduced by $10,550; professional fees were reduced by
$49,050; other administrative expenses were reduced by $70,165; and overall
reductions in write off and depreciation on interest and loans receivable were
reduced by $189,765. These improvements were primarily the result of an
improving Chicago taxi portfolio."
Granoff further stated "We are continuing to take steps to build our loan and
investment portfolio. In addition, during the quarter ended December, 31, 2005
we were positively impacted by the closing of the first round of our private
placement in early December, 2005, during which the Company sold 657,620 common
shares and 164,405 warrants to purchase common shares for gross proceeds of
$3,847,080 ($3,521,629 net of expenses). Subsequently, in January, 2006 an
additional 70,000 shares and an additional 17,500 warrants were sold as part of
the private placement for gross proceeds of $409,500. The new capital is
temporarily being utilized by the Company to reduce Elk Associates Funding
Corporation's bank debt, which will result in a short term savings in interest
expense. As suitable loans and investments are located for Ameritrans, it is
the Company's intention to borrow the funds back from Elk's bank lines of credit
and repay the funds from Elk to Ameritrans to permit Ameritrans to complete the
funding of its' proposed loans.
or investments. Since Ameritrans is able to make loans and investments in
transactions that do not have to comply with SBA Regulations, the Company has
gained an advantage of being able to make or participate in a wider range of
loans and investments other than primarily making loans and investments that
satisfy applicable SBA Regulations."
Granoff added, "The Company's stockholders recently approved the extension of
the Company's private placement to March 31, 2006."
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, was licensed by the United States
Small Business Administration as a Small Business Investment Company (SBIC) in
1980. The Company maintains its offices at 747 Third Avenue, 4th Floor; New
York, NY 10017.
# # #
This announcement contains 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
DECEMBER 31, 2005 (UNAUDITED) AND JUNE 30, 2005
ASSETS
December 31, 2005 June 30, 2005
Loans receivable $ 50,750,739 $ 52,060,254
Less: unrealized depreciation on loans receivable (225,000) (150,000)
Loans receivable, net 50,525,739 51,910,254
Cash and cash equivalents 518,932 327,793
Accrued interest receivable, net of unrealized
deprecation of $36,800 and $59,000, respectively 771,374 756,701
Assets acquired in satisfaction of loans 384,528 384,528
Receivables from debtors on sales of assets acquired
in satisfaction of loans 406,850 455,184
Equity securities 858,985 908,457
Furniture, equipment and leasehold improvements, net 244,906 329,573
Medallions under lease 2,224,701 2,282,201
Prepaid expenses and other assets 386,456 531,904
TOTAL ASSETS $ 56,322,471 $ 57,886.595
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2005 (UNAUDITED) AND JUNE 30, 2005
LIABILITIES AND STOCKHOLDERS' EQUITY
December 31, 2005 June 30, 2005
LIABILITIES
Debentures payable to SBA $12,000,000 $12,000,000
Notes payable, banks 25,125,568 29,770,652
Accrued expenses and other liabilities 492,214 604,942
Accrued interest payable 240,139 256,285
Dividends payable 84,375 84,375
TOTAL LIABILITIES 37,942,296 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; 3,600,000 3,600,000
300,000 shares issued and outstanding
Common stock, $0.0001 par value;
5,000,000 shares authorized; 2,703,220
and 2,045,600 shares issued and 2,693,220
and 2,035,600 shares outstanding at
December 31, 2005 and June 30, 2005,
respectively 270 205
Additional paid-in-capital
17,391,109 13,869,545
Accumulated deficit (2,334,327) (2,127,134)
Accumulated other comprehensive loss (206,877) (102,275)
18,450,175 15,240,341
Less: Treasury stock, at cost, 10,000 shares
of common stock (70,000) (70,000)
TOTAL STOCKHOLDERS' EQUITY 18,380,175 15,170,341
TOTAL LIABILITIES AND
STOCKHOLDERS'EQUITY $56,322,471 $57,886,595
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2005 AND 2004 (Unaudited)
Three Months Ended Three Months Ended Six Months Six Months
December 31,2005 December 31,2004 Ended Ended
December December
31,2005 31,2004
INVESTMENT INCOME
Interest on loans receivable $1,241,722 $1,154,708 $2,391,505 $2,283,765
Fees and other income 68,649 88,687 150,950 189,227
Leasing income 46,269 73,796 95,737 125,333
(Loss) gain on sale of securities - (50,000) - (50,000)
TOTAL INVESTMENT INCOME 1,356,640 1,267,191 2,638,192 2,548,325
OPERATING EXPENSES
Interest 586,181 441,400 1,125,454 823,156
Salaries and employee benefits 282,531 293,081 558,769 555 745
Occupancy costs 46,304 46,434 101,020 95,617
Professional fees 146,684 195,734 216,496 331,298
Other administrative expenses 227,320 297,485 509,109 542,953
Loss and impairments on assets
acquired in satisfaction of loans, net 1,031 22,154 4,031 32,547
Foreclosure expenses 12,333 9,194 14,541 14,194
Write off and depreciation on interest
and loans receivable 98,776 288,541 134,624 390,059
TOTAL OPERATING EXPENSES 1,401,160 1,593,623 2,664,044 2,785,569
OPERATING LOSS (44,520) (326,432) (25,852) (237,244)
OTHER INCOME (EXPENSE)
Gain on sale of asset acquired - 1,884 - 1,884
Loss on sale of automobiles (2,867) (2,867)
Equity in loss of investee - (2,010) - (4,021)
TOTAL OTHER EXPENSE, net (2,867) (126) (2,867) (2,137)
LOSS BEFORE PROVISION FOR
INCOME TAXES (47,387) (326,558) (28,719) (239,381)
PROVISION FOR INCOME TAXES - 682 9,724 3,147
NET LOSS $ (47,387) $(327,240) (38,443) (242,528)
DIVIDENDS ON PREFERRED STOCK $ (84,375) $ (84,375) (168,750) (168,750)
NET LOSS AVAILABLE TO COMMON
SHAREHOLDERS $(131,762) $(411,615) $(207,193) (411,278)
WEIGHTED AVERAGE SHARES
OUTSTANDING
- - Basic 2,132,075 2,035,600 2,228,551 2,035,600
- -Diluted 2,132,075 2,035,600 2,228,551 2,035,600
NET LOSS PER COMMON SHARE
- - Basic $ (0.06) (0.20) (0.09) (0.20)
- - Diluted (0.06) (0.20) (0.09) (0.20)