Exhibit 99.1
FOR IMMEDIATE RELEASE
CONTACT:
Stephen D. Axelrod, CFA
Mitchell Herman, CFO Andria Pilo (Media)
Asta Funding, Inc. Wolfe Axelrod Weinberger Assoc. LLC
(201) 567-5648 (212) 370-4500; (212) 370-4505 (Fax)
steve@wolfeaxelrod.com
ASTA FUNDING REPORTS THIRD QUARTER AND NINE MONTHS FISCAL 2003 RESULTS
Company Announces Initial $0.05 Quarterly Dividend
ENGLEWOOD CLIFFS, NJ, August 11, 2003 -- Asta Funding, Inc., (NASDAQ: ASFI), a
leading consumer receivables asset management and liquidation company, today
reported results for the three months and nine months ended June 30, 2003. The
Company's Board of Directors also declared an initial quarterly cash dividend of
$0.05 per share. The dividend is payable November 1, 2003 to shareholders of
record at the close of business on September 30, 2003.
Net income for the three months ended June 30, 2003, declined 6% to $2,540,000,
or $0.55 per diluted share, compared to $2,716,000, or $0.61 per diluted share,
in the same prior year period. Revenues for the three months ended June 30,
2003, were $9,208,000, an increase of 5% compared to revenues of $8,800,000 a
year ago.
Net income for the nine months ended June 30, 2003 declined 5% to $7,281,000 or
$1.62 per diluted share, from $7,646,000, or $1.72 per diluted share, for the
same period a year earlier. Revenues for the nine months ended June 30, 2003
were $23,679,000, a decline of 14% compared to revenues for the nine months
ended June 30, 2002 of $27,584,000.
Based on an increase in actual cash flows for the three months and nine months
ended June 30, 2003, and projected cash flows on certain portfolios as compared
to what the Company estimated at September 30, 2002, the Company revised the
estimates of future collections on certain portfolios. Such change in accounting
estimates has resulted in approximately a $3.9 million increase in finance
income recognized for the nine months ended June 30, 2003.
The increase in third quarter revenues was primarily due to an increase in
finance income earned on consumer receivables acquired for liquidation, which
resulted from the sale of certain receivables during the three months ended June
30, 2003, as compared to no receivable sales in the same prior year period.
Gary Stern, President and CEO commented, "For the first six months of the
current fiscal year those distressed consumer receivable portfolios that were
available were priced at levels that we deemed unattractive and, as a result, we
purchased very few portfolios. Our decision to refrain from purchasing
portfolios earlier this year has been justified as, in recent months and after
careful review, we have acquired several distressed consumer receivable
portfolios that adhere to our disciplined purchasing policy. Since May, we have
found that the availability of large distressed consumer receivable portfolios
at attractive prices increased markedly and we have successfully acquired a
number of distressed consumer receivable portfolios whose cumulative face value
amount to over $2 billion. We continue to carefully review other potential
distressed consumer portfolio acquisitions."
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Mr. Stern added, "At the end of June, the Company completed a public offering of
2,475,000 shares at $20.75 per share. The offering netted $47.8 million that
will be used for further purchases of distressed consumer receivables, working
capital and general corporate purposes. With the additional capital, Asta
Funding will be less reliant on outside sources to fund our growth and, thereby,
retain more of the potential profit for our shareholders."
"With the proceeds of $47.8 million from our public offering, our available
cash, after repayment of $18.3 million under our bank line of credit, increased
to approximately $31million in early July 2003 compared to $14.9 million at
March 31, 2003. With approximately $13.5 million in debt currently outstanding,
Asta Funding is in the strongest financial position in its history. Our
financial strength will permit the Company to acquire attractively priced
portfolios in the future as they become available," Mr. Stern stated.
"In addition, Mr. Stern concluded, "the announcement that the Board of Directors
has declared the first dividend in the Company's history, demonstrates the
confidence that the Board of Directors has in Asta Funding's current and future
business prospects. Our business is strong and given its growth prospects, we
believe it is appropriate at this time to commence a regular quarterly dividend
program."
Asta Funding will conduct a teleconference today at 11:00 a.m. Eastern time. To
participate please dial USA (877) 511-5818, International (706) 634-1462 about
5-10 minutes prior to 11:00 am EDT. Please refer to the Asta Funding earnings
teleconference ID 2071782. A recording of the conference call will be available
from 12:00 noon EDT August 11th through August 18th, by dialing USA/ Canada
(800) 642-1687, International (706) 645-9291, conference ID 2071782.
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Asta Funding, Inc.
Based in Englewood Cliffs, NJ, Asta Funding, Inc., is a leading consumer
receivables asset management company that specializes in the purchase,
liquidation and management of performing and non-performing consumer
receivables. Asta generates revenues and earnings primarily through purchase and
collection of performing and non-performing consumer receivables. For additional
information, please visit our website at www.astafunding.com.
Except for historical information containing herein, the matters set forth in
this news release are "forward looking" statements (as defined in the Private
Securities Litigation Reform Act of 1995.) Although Asta Funding, Inc. believes
the expectations reflected in such forward-looking statements are based upon
reasonable assumptions; there can be no assurance that its expectations will be
realized. Forward -looking statements involve certain risks and uncertainties
that could cause actual results to differ materially from Asta Funding, Inc.'s
expectations. Factors that could contribute to such differences include those
identified in Asta Funding, Inc.'s Form 10-KSB for the fiscal year ended
September 30, 2002, its prospectus dated June 27, 2003, and those described from
time to time in Asta Funding, Inc.'s other fillings with the Securities and
Exchange Commission, news releases and other communications, including that Asta
may not be able to purchase consumer receivable portfolios at favorable prices
or on sufficiently favorable terms or at all, and may not be able to continue
our new quarterly dividend program. Asta Funding, Inc.'s reports with the
Securities and Exchange Commission are available free of charge through its
website at www.astafunding.com.
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Asta Funding, Inc. and Subsidiaries
Consolidated Statements of Operations
Unaudited
Three Months Ended Nine Months Ended
June 30, June 30, June 30, June 30,
2003 2002 2003 2002
---- ---- ---- ----
Revenues:
Finance income $9,208,000 $8,800,000 $23,679,000 $27,488,000
-- -- -- 96,000
9,208,000 8,800,000 23,679,000 27,584,000
---------- ---------- ----------- -----------
Expenses:
General and administrative 2,067,000 1,374,000 5,429,000 4,704,000
Third-party servicing 1,320,000 1,539,000 4,496,000 6,261,000
Provision for losses -- 350,000 -- 750,000
Interest 1,409,000 999,000 1,422,000 3,094,000
---------- ---------- ----------- -----------
4,796,000 4,262,000 11,347,000 14,809,000
---------- ---------- ----------- -----------
Income before income taxes 4,412,000 4,538,000 12,332,000 12,775,000
Income tax expense 1,872,000 1,822,000 5,051,000 5,129,000
---------- ---------- ----------- -----------
Net income $2,540,000 $2,716,000 $7,281,000 $7,646,000
========== ========== ========== ==========
Net income per share - Basic $0.61 $0.67 $1.77 $1.90
----- ----- ----- -----
- Diluted $0.55 $0.61 $1.62 $1.72
----- ----- ----- -----
Weighted average number of shares
outstanding - Basic 4,188,000 4,047,000 4,116,000 4,029,000
---------- ---------- ----------- -----------
- Diluted 4,636,000 4,456,000 4,488,000 4,453,000
---------- ---------- ----------- -----------
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