Advanta Completes Strong 2005 as Expected.SPRING HOUSE, Pa. -- Advanta Advanta is an American banking company. Currently, it controls two banks, Advanta Bank Corp and Advanta National Bank. The banking corporation is not associated with Advanta Energy Corp., an energy consulting practice based in California. Corp. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ADVNB; ADVNA ADVNA Advanta Corporation (stock symbol) ) today reported full year 2005 net income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $116.7 million or $4.02 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share for Class A and Class B shares combined as compared to $44.3 million or $1.60 per combined diluted share for 2004. Book value per share increased $3.84 during 2005, including a $2.56 increase representing the net after-tax gain Net after-tax gain Capital gain after income taxes have been paid. and increase in additional paid-in capital additional paid-in capital Stockholder contributions that are in excess of a stock's stated or par value. For example, if a firm issues stock with a par value of $1 per share but sells the stock to investors at $10 per share, the firm's financial statements in the first quarter associated with the agreement with Bank of America
Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world. . Net income from continuing operations for 2005 includes a $2.14 per combined diluted share gain relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the agreement with Bank of America and a $0.02 per combined diluted share asset valuation gain associated with the Company's venture capital portfolio. Net income from continuing operations for 2004 includes a $0.03 per combined diluted share asset valuation charge associated with the Company's venture capital portfolio and a $0.02 per combined diluted share charge associated with the closure of the Company's New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of venture capital office in the first quarter of 2004. "We are pleased with our performance for full year 2005, a year in which we experienced both record transaction volume and additions of new high credit quality customers," said Dennis Dennis is a male first name derived from the Greco-Roman name Dionysius meaning "servant of Dionysus", the Thracian god of wine, which is ultimately derived from the Greek Dios (Διος, "of Zeus") combined with Nysos or Nysa (Νυσα), where the Alter, Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "The execution of our strategy has us very well positioned for 2006." Advanta reported net income from continuing operations of $13.5 million or $0.46 per combined diluted share for fourth quarter 2005, consistent with expectations, as compared to $13.4 million or $0.47 per combined diluted share for fourth quarter 2004. Net income from continuing operations includes a $0.01 per combined diluted share asset valuation gain associated with the Company's venture capital portfolio in both periods. Conference Call Details Advanta management will hold a conference call with analysts and institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. today, January January: see month. 26, at 9:00 a.m. Eastern time. The call can be accessed by dialing 719-457-2727 and referring to pass code 9621491. The call will also be webcast simultaneously si·mul·ta·ne·ous adj. 1. Happening, existing, or done at the same time. See Synonyms at contemporary. 2. Mathematics via a Vcall link on the Company's website, www.advanta.com, or at www.vcall.com. Those interested in listening to the webcast should go to the website at least fifteen minutes before the call to register and download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. any necessary software. Replays of the call will be available beginning at noon today on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.advanta.com or www.vcall.com or by dialing (719) 457-0820 and referring to confirmation code 9621491. The conference call may include a discussion of non-GAAP financial measures, which are reconciled rec·on·cile v. rec·on·ciled, rec·on·cil·ing, rec·on·ciles v.tr. 1. To reestablish a close relationship between. 2. To settle or resolve. 3. to the most directly comparable GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). financial measure in this press release or the statistical supplements available at www.advanta.com in the "Corporate Info INFO Information INFO Information (logging abbreviation) INFO Inform(ed/ation) INFO Ionic Difluoroamino Oxidizer " section. About Advanta Advanta focuses on the small business market and related community, providing funding and support to the nation's small businesses and business professionals through innovative products and services. Using its direct marketing and information based expertise, Advanta identifies potential customers and provides a high level of service tailored to the unique needs of small businesses. Advanta is one of the nation's largest issuers (through Advanta Bank Corp.) of MasterCard MasterCard Worldwide (NYSE: MA) is a mutinational corporation based in Purchase, NY in the United States. Throughout the world, its principal business is to process payments between the banks of merchants and the banks of purchasers that use its "Mastercard" branded debit- and business credit cards to small businesses. Since 1951, Advanta has pioneered many of the marketing techniques common in the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. industry today, including remote lending and direct mail, affinity The relationship that a person has to the blood relatives of a spouse by virtue of the marriage. The doctrine of affinity developed from a Maxim of Canon Law that a Husband and Wife were made one by their marriage. There are three types of affinity. and relationship marketing. Learn more about Advanta at www.advanta.com. This Press Release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are subject to certain risks and uncertainties that could cause actual results to differ from those projected. Risks that may affect the Company's future performance are detailed in the Company's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and its Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. . In addition to the GAAP results provided throughout this document, the Company has provided managed receivable data and other non-GAAP financial measurements. Management believes that the non-GAAP financial measures used to manage the business may provide users additional useful information. The tables attached to this press release include a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure and a description of why the non-GAAP financial measures are useful to investors.
ADVANTA
SEGMENT INCOME STATEMENT
(in thousands)
Three Months Ended
December 31, 2005
----------------------------------------------------------------------
Advanta
Business Venture
Cards Capital Other (A) Total
-------- ------- --------- ---------
Interest income $36,018 $ 4 $ 5,262 $ 41,284
Interest expense 9,453 20 6,509 15,982
-------- ------- --------- ---------
Net interest income 26,565 (16) (1,247) 25,302
Provision for credit losses 10,018 0 0 10,018
-------- ------- --------- ---------
Net interest income after
provision for credit losses 16,547 (16) (1,247) 15,284
Noninterest revenues:
Interchange income 45,528 0 0 45,528
Securitization income 16,792 0 0 16,792
Servicing revenues 12,876 0 0 12,876
Business credit card rewards (15,828) 0 0 (15,828)
Other revenues, net 3,906 548 2,467 6,921
-------- ------- --------- ---------
Total noninterest revenues 63,274 548 2,467 66,289
Operating expenses 58,252 0 1,220 59,472
-------- ------- --------- ---------
Income before income taxes 21,569 532 0 22,101
Income tax expense 8,412 207 0 8,619
-------- ------- --------- ---------
Income from continuing operations 13,157 325 0 13,482
Gain on discontinuance of
mortgage and leasing businesses,
net of tax 0 0 2,074 2,074
-------- ------- --------- ---------
Net income $13,157 $ 325 $ 2,074 $ 15,556
======== ======= ========= =========
Three Months Ended
December 31, 2004
----------------------------------------------------------------------
Advanta
Business Venture
Cards Capital Other (A) Total
-------- ------- --------- ---------
Interest income $27,694 $ 7 $ 2,513 $ 30,214
Interest expense 8,842 60 3,059 11,961
-------- ------- --------- ---------
Net interest income 18,852 (53) (546) 18,253
Provision for credit losses 10,721 0 (16) 10,705
-------- ------- --------- ---------
Net interest income after
provision for credit losses 8,131 (53) (530) 7,548
Noninterest revenues:
Interchange income 37,460 0 0 37,460
Securitization income 28,192 0 0 28,192
Servicing revenues 12,502 0 0 12,502
Business credit card rewards (11,721) 0 0 (11,721)
Other revenues, net 3,159 510 1,748 5,417
-------- ------- --------- ---------
Total noninterest revenues 69,592 510 1,748 71,850
Operating expenses 56,872 27 1,218 58,117
-------- ------- --------- ---------
Income before income taxes 20,851 430 0 21,281
Income tax expense 7,688 191 0 7,879
-------- ------- --------- ---------
Income from continuing operations 13,163 239 0 13,402
Gain, net, on discontinuance of
mortgage and leasing businesses,
net of tax 0 0 308 308
-------- ------- --------- ---------
Net income $13,163 $ 239 $ 308 $ 13,710
======== ======= ========= =========
(A) Other includes investment and other activities not attributable
to the Advanta Business Cards or Venture Capital segments.
ADVANTA
HIGHLIGHTS
(in thousands, except per share data)
Three Months Ended
--------------------------- Percent Change From
Dec. 31, Sept. 30, Dec. 31, Prior Prior
EARNINGS 2005 2005 2004 Quarter Year
----------------------------------------------------------------------
Basic income from
continuing operations
per common share:
Class A $0.48 $0.58 $0.51 (17.2)% (5.9)%
Class B 0.51 0.61 0.54 (16.4) (5.6)
Combined (A) 0.50 0.60 0.53 (16.7) (5.7)
Diluted income from
continuing operations
per common share:
Class A 0.45 0.54 0.46 (16.7) (2.2)
Class B 0.46 0.56 0.48 (17.9) (4.2)
Combined (A) 0.46 0.55 0.47 (16.4) (2.1)
Basic net income per
common share:
Class A 0.56 0.12 0.52 366.7 7.7
Class B 0.59 0.15 0.55 293.3 7.3
Combined (A) 0.58 0.14 0.54 314.3 7.4
Diluted net income per
common share:
Class A 0.52 0.12 0.47 333.3 10.6
Class B 0.53 0.14 0.49 278.6 8.2
Combined (A) 0.53 0.13 0.48 307.7 10.4
Return on average
common equity 12.28% 3.08% 14.24% 298.7 (13.8)
COMMON STOCK DATA
----------------------------------------------------------------------
Weighted average
common shares used to
compute:
Basic earnings per
common share
Class A 8,837 8,829 8,811 0.1% 0.3%
Class B 17,992 17,901 16,630 0.5 8.2
-------- --------- --------
Total 26,829 26,730 25,441 0.4 5.5
Diluted earnings per
common share
Class A 8,837 8,829 8,811 0.1 0.3
Class B 20,535 20,409 19,589 0.6 4.8
-------- --------- --------
Total 29,372 29,238 28,400 0.5 3.4
Ending shares
outstanding:
Class A 9,607 9,607 9,607 0.0 0.0
Class B 18,756 18,692 18,350 0.3 2.2
-------- --------- --------
Total 28,363 28,299 27,957 0.2 1.5
Stock price:
Class A
High $31.30 $28.75 $24.19 8.9 29.4
Low 22.62 24.34 20.34 (7.1) 11.2
Closing 30.13 26.06 22.62 15.6 33.2
Class B
High 33.06 30.96 26.07 6.8 26.8
Low 24.76 26.65 21.68 (7.1) 14.2
Closing 32.44 28.23 24.27 14.9 33.7
Cash dividends
declared:
Class A 0.113 0.113 0.095 0.0 20.0
Class B 0.136 0.136 0.113 0.0 20.0
Book value per common
share 18.74 18.35 14.90 2.1 25.8
(A) Combined represents income available to common stockholders
divided by the combined total of Class A and Class B weighted
average common shares outstanding.
ADVANTA
BUSINESS CREDIT CARD STATISTICS
($ in thousands)
Three Months Ended Percent
----------------------------------- Change From
Dec. 31, Sept. 30, Dec. 31, Prior Prior
2005 2005 2004 Quarter Year
---------------------------------------------------
New account
originations 64,206 57,974 40,663 10.7% 57.9%
Average number of
active
accounts (A) 621,966 604,486 575,204 2.9 8.1
Ending number of
accounts 877,114 846,472 777,943 3.6 12.7
Transaction volume $2,693,908 $2,513,752 $2,214,215 7.2 21.7
Securitization
volume increase
excluding
replenishment
sales $ 100,000 $ 96,968 $ 55,000 3.1 81.8
Average managed
receivables:
Owned $1,011,684 $ 819,870 $ 722,088 23.4 40.1
Securitized 2,694,391 2,751,024 2,536,711 (2.1) 6.2
----------- ----------- -----------
Managed (B) 3,706,075 3,570,894 3,258,799 3.8 13.7
Ending managed
receivables:
Owned $ 879,468 $ 822,821 $ 730,483 6.9 20.4
Securitized 2,880,401 2,781,397 2,564,147 3.6 12.3
----------- ----------- -----------
Managed (B) 3,759,869 3,604,218 3,294,630 4.3 14.1
----------------------------------------------------------------------
CREDIT
QUALITY - OWNED
------------------
Receivables 30
days or more
delinquent $ 23,595 $ 27,324 $ 28,287
Receivables 90
days or more
delinquent 10,837 12,479 13,638
As a percentage of
gross
receivables:
Receivables 30
days or more
delinquent 2.68% 3.32% 3.87% (19.3)% (30.7)%
Receivables 90
days or more
delinquent 1.23 1.52 1.87 (19.1) (34.2)
Net principal
charge-offs:
Amount $ 15,768 $ 10,075 $ 10,721
As a percentage
of average
gross
receivables
(annualized) 6.23% 4.92% 5.94% 26.6 4.9
CREDIT QUALITY -
SECURITIZED
------------------
Receivables 30
days or more
delinquent $ 87,610 $ 100,650 $ 107,546
Receivables 90
days or more
delinquent 40,223 45,387 51,770
As a percentage of
gross
receivables:
Receivables 30
days or more
delinquent 3.04% 3.62% 4.19% (16.0)% (27.4)%
Receivables 90
days or more
delinquent 1.40 1.63 2.02 (14.1) (30.7)
Net principal
charge-offs:
Amount $ 46,151 $ 35,873 $ 38,457
As a percentage
of average
gross
receivables
(annualized) 6.85% 5.22% 6.06% 31.2 13.0
CREDIT QUALITY -
MANAGED (B)
------------------
Receivables 30
days or more
delinquent $ 111,205 $ 127,974 $ 135,833
Receivables 90
days or more
delinquent 51,060 57,866 65,408
As a percentage of
gross
receivables:
Receivables 30
days or more
delinquent 2.96% 3.55% 4.12% (16.6)% (28.2)%
Receivables 90
days or more
delinquent 1.36 1.61 1.99 (15.5) (31.7)
Net principal
charge-offs:
Amount $ 61,919 $ 45,948 $ 49,178
As a percentage
of average
gross
receivables
(annualized) 6.68% 5.15% 6.04% 29.7 10.6
(A) Active accounts are defined as accounts with a balance at
month-end. Active account statistics do not include charged-off
accounts. The statistics reported above are the average number of
active accounts for the periods presented.
(B) Managed statistics are non-GAAP financial measures and represent
the sum of owned (GAAP) business credit card statistics and
securitized business credit card statistics. We believe that
performance on a managed basis provides useful supplemental
information because we retain interests in the securitized
receivables and, therefore, we have a financial interest in and
exposure to the performance of the securitized receivables.
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