Exhibit 99.1
Ameritrans Reports Third Quarter Results
Friday May 16, 9:41 am ET
NEW YORK--May 16, 2003--Ameritrans Capital Corporation (NASDAQ: AMTC - News,
AMTCP - News) today reported total investment income of $1.55 million during the
quarter ended March 31, 2003, compared to $1.64 million during the prior
comparable period.
Citing weakness in the Chicago market, Ameritrans reported a net loss available
to common shareholders for the three months ended March 31, 2003 of $182,222, or
$0.09 per basic and diluted common share, versus net income of $215,671, or
$0.12 per basic and diluted common share, in the third quarter of fiscal 2002.
This consisted of the net loss from operations of $97,847 for the quarter and
the impact of dividends paid on preferred stock of $84,375. The net loss from
operations was the result of an increase in write offs for loan losses,
foreclosure expenses, and expenses related to preparing a post-effective
amendment to a registration statement for the public warrants issued in April
2002. Net loss per common share also reflects higher weighted average shares
outstanding in the quarter ended March 31, 2003. The weighted average shares
outstanding for the period were 2,035,600 versus 1,745,600 in the quarter ended
March 31, 2002.
The Company's loan portfolio at March 31, 2003 was $57.0 million versus $53.8
million at March 31, 2002. At March 31, 2003 Ameritrans book value was $6.25 per
basic and diluted common share.
Gary C. Granoff, Ameritrans' president said, "The strength of our third quarter
results is masked by the increased loan loss write offs and the higher
foreclosure expenses which we realized in the quarter. On an operating basis we
generated approximately $340,000 in profits before the write-offs, foreclosure
expenses, and legal and accounting charges related to the post-effective
amendment to the registration statement. Our loan portfolio continues to grow,
and we intend to continue to take advantage of the favorable interest rate
environment, which will allow us to reduce our cost of funds and improve our
margins. As a result of the loss, the Company's directors have determined not to
declare a dividend on AMTC's common stock for the third quarter."
For the nine months ended March 31, 2003, Ameritrans reported total investment
income of $4.7 million, compared to $4.6 million during the prior comparable
period. Net income available to common shareholders for the nine months ended
March 31, 2003 was $215,046, or $0.11 per basic and diluted common share, versus
$860,298, or $0.49 per basic and diluted common share, in the first nine months
of fiscal 2002.
Net income available to common shareholders for the nine month period was
impacted by dividends paid on preferred stock of $253,125, as well as increased
loan loss write offs, foreclosure expenses, and expenses related to the
post-effective amendment to the registration statement. Net income per common
share also reflects higher weighted average shares outstanding in the nine
months ended March 31, 2003.
Granoff commented, "We are starting to see a rebound in the demand for
medallions in the Chicago market. We are continuing to sell medallions acquired
through foreclosure and we are currently in the process of arranging leasing
programs to operate medallions owned by Ameritrans through newly formed
subsidiary corporations. As a result, we intend to lease many of the medallions
we will own at the end of the foreclosure process and expect that this leasing
income will have a positive impact on our Chicago operations. We do, however,
expect additional one-time cash and non-cash charges in the fourth quarter as we
move toward completing the foreclosure of medallions loans that are in default
and placing them back in operation."
"While our third quarter is disappointing, we believe that Ameritrans is taking
the necessary steps to address the difficulties in the Chicago taxi market and
to enable these medallions to become working assets as soon as practicable."
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
March 31, 2003 (Unaudited) and June 30, 2002
ASSETS
March 31, June 30,
2003 2002
------------ ------------
Loan receivable $ 56,973,994 $ 55,029,831
Less: unrealized depreciation on loans
receivable (238,500) (238,500)
------------ ------------
56,735,494 54,791,331
Cash and cash equivalents 763,213 774,062
Accrued interest receivable, net of
unrealized depreciation of $399,000 and
$206,272, respectively 1,465,484 1,197,075
Assets acquired in satisfaction of loans 942,189 1,108,088
Receivables from debtors on sales of assets
acquired in satisfaction of loans 431,258 367,271
Equity securities 964,563 443,327
Furniture, fixtures and leasehold
improvements, net 168,333 107,757
Prepaid expenses and other assets 487,652 219,305
------------ ------------
TOTAL ASSETS $ 61,958,186 $ 59,008,216
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, June 30,
2003 2002
------------ ------------
LIABILITIES
Debentures payable to SBA $ 9,200,000 $ 7,860,000
Notes payable, banks 35,780,000 33,720,000
Accrued expenses and other liabilities 436,761 434,339
Accrued interest payable 127,229 258,358
Dividends payable 84,375 68,438
------------ ------------
TOTAL LIABILITIES 45,628,365 42,341,135
------------ ------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock 500,000 shares authorized
respectively, none issued or outstanding -- --
9 3/8% Cumulative participating 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 and
2,035,600 shares outstanding 205 205
Additional paid-in-capital 13,869,545 13,869,545
Accumulated deficit (1,040,387) (703,127)
Accumulated other comprehensive loss (29,542) (29,542)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 16,399,821 16,737,081
------------ ------------
Treasury stock, at cost, 10,000 shares
common stock (70,000) (70,000)
------------ ------------
NET STOCKHOLDERS' EQUITY 16,329,821 16,667,081
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 61,958,186 $ 59,008,216
============ ============
AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS
OF OPERATIONS
(Unaudited)
For the Three Months and Nine Months Ended March 31, 2003 and 2002
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
March 31, March 31, March 31, March 31,
2003 2002 2003 2002
----------- ---------- ----------- ----------
INVESTMENT INCOME
Interest on loans
receivable $ 1,499,081 $1,533,452 $ 4,593,638 $4,433,111
Fees and other income 48,604 104,855 151,149 204,328
----------- ---------- ----------- ----------
TOTAL INVESTMENT
INCOME 1,547,685 1,638,307 4,744,787 4,637,439
----------- ---------- ----------- ----------
OPERATING EXPENSES
Interest 555,249 652,857 1,622,264 2,025,435
Salaries and
employee
benefits 220,055 215,292 654,103 554,741
Legal fees 82,152 84,708 235,415 183,263
Miscellaneous
administrative
expenses 331,886 281,296 954,472 706,440
Loss on assets
acquired in
satisfaction of
loans, net 57,800 14,494 72,464 64,660
Directors' fee 11,750 6,375 27,250 19,075
Foreclosure
expenses 161,667 -- 281,838
Write off and
depreciation of
interest and
loans
receivable 220,530 161,088 412,884 215,931
----------- ---------- ----------- ----------
TOTAL OPERATING
EXPENSES 1,641,089 1,416,110 4,260,690 3,769,545
----------- ---------- ----------- ----------
(LOSS) INCOME
BEFORE INCOME
TAXES (93,404) 222,197 484,097 867,894
----------- ---------- ----------- ----------
INCOME TAXES 4,443 6,526 15,926 7,596
----------- ---------- ----------- ----------
NET (LOSS)
INCOME (97,847) 215,671 468,171 860,298
----------- ---------- ----------- ----------
DIVIDENDS ON PREFERRED
STOCK (84,375) -- (253,125) --
----------- ---------- ----------- ----------
NET (LOSS) INCOME
AVAILABLE TO
COMMON
STOCKHOLDERS $ (182,222) $ 215,671 $ 215,046 $ 860,298
----------- ---------- ----------- ----------
WEIGHTED AVERAGE
SHARES OUTSTANDING
- Basic 2,035,600 1,745,600 2,035,600 1,745,600
=========== ========== =========== ==========
- Diluted 2,035,600 1,745,600 2,035,600 1,745,600
=========== ========== =========== ==========
NET (LOSS) INCOME PER
COMMON SHARE
- Basic $ (0.09) $ 0.12 $ 0.11 $ 0.49
=========== ========== =========== ==========
- Diluted $ (0.09) $ 0.12 $ 0.11 $ 0.49
=========== ========== =========== ==========