Advanta Reports Second Quarter Earnings.Business Editors SPRING HOUSE, Pa.--(BUSINESS WIRE)--July 24, 2003 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. Corporation (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 net income from core operations of $0.29 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 second quarter 2003 for Class A and Class B shares combined, in line with the Company's previously described expectations, as compared to $0.32 per diluted share for second quarter 2002. Advanta reported consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: net income for the quarter of $4.3 million or $0.18 per diluted share for Class A and Class B shares combined as compared to net loss of $1.5 million or $0.06 per diluted share for the second quarter of 2002. Net income from core operations is a non-GAAP financial measure defined by the Company as net income of the Advanta Business Cards segment and the Venture Capital segment with the exception of venture capital valuation adjustments, net of tax. Second quarter 2003 consolidated net income includes a $0.03 per diluted share asset valuation charge associated with the Company's venture capital portfolio and an $0.08 charge associated with discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. . "Our strategic focus on high credit quality customers and strong asset quality continues to yield solid results," 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. . "At the same time, we are developing tools and services for small business that enable us to effectively meet our customer's needs, recently winning an award for our customer-centric website." Business Card results for the second quarter include an approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. 100 basis point decline in net principal charge-offs on managed receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed to 8.0% on an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis as compared to 9.0% for the quarter ended June June: see month. 30, 2002. Over 30 day delinquencies on managed receivables declined 31 basis points to 6.28% and over 90 day delinquencies on managed receivables decreased 17 basis points to 3.19% as compared to second quarter 2002. Business Card ended the quarter with managed receivables of $2.8 billion as compared to $2.2 billion at June 30, 2002. Net principal charge-offs on owned receivables declined approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 65 basis points to 7.6% on an annualized basis for second quarter 2003 as compared to 8.2% for second quarter of 2002. Over 30 day delinquencies on owned receivables declined 64 basis points to 5.84% and over 90 day delinquencies on owned receivables decreased 34 basis points to 2.98% as compared to second quarter 2002. Owned Business Card receivables were $443 million at both June 30, 2003 and 2002. The Company continued its stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program bringing the total purchases to approximately 2,563,000 Class B shares and 177,000 Class A shares through July July: see month. 23, 2003. The Company intends further stock repurchases under the remaining unused authorization The right or permission to use a system resource; the process of granting access. See access control. of approximately 260,000 shares. 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, July 24, 2003, at 9:00 a.m. Eastern time. The call will be broadcast simultaneously si·mul·ta·ne·ous adj. 1. Happening, existing, or done at the same time. See Synonyms at contemporary. 2. Mathematics for the public over 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 through www.advanta.com or www.vcall.com. To listen to the live call, please go to the website at least 15 minutes early to register, 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. , and install any necessary audio software. Replays of the call will be available beginning at noon today on the Internet at www.advanta.com or www.vcall.com or by dialing (719) 457-0820 and referring to confirmation code 480773. 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 our statistical supplement, both available at www.advanta.com in the "About Advanta" section. About Advanta Advanta is a highly focused 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. company serving the small business market. Advanta leverages direct marketing and information based expertise to identify potential customers and new target markets and to provide a high level of service tailored to the unique needs of small business. Using these distinctive capabilities, Advanta has become one of the nation's largest issuers 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 industry today, including remote lending, direct mail, and 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 materially from those projected. The most significant among these risks and uncertainties are: (1) the Company's managed net interest income; (2) competitive pressures; (3) political, social and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. general economic conditions that affect the level of new account originations, customer spending, delinquencies and charge-offs; (4) factors affecting fluctuations in the number of accounts or receivable balances, including the retention of cardholders after promotional pricing periods have expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. ; (5) interest rate fluctuations; (6) the level of expenses; (7) the timing of the securitizations of the Company's receivables; (8) factors affecting the value of investments held by the Company; (9) the effects of government regulation, including restrictions and limitations imposed by banking laws, regulators, examinations, and the agreements between the Company's bank subsidiaries and their regulators; (10) relationships with customers, significant vendors and business partners; (11) difficulties or delays in the development, production, testing and marketing of products or services; (12) the amount and cost of financing available to the Company; (13) the ratings on the debt of the Company and its subsidiaries; (14) revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. to estimates associated with the discontinued operations of the Company's mortgage and leasing businesses; and (15) the impact of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. . Additional 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 these non-GAAP financial measures used in managing 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 CORP.
SEGMENT INCOME STATEMENT
(in thousands)
Three Months Ended
June 30, 2003
----------------------------------------------------------------------
Advanta
Business Venture
Cards Capital Other(A) Total
--------- -------- ------- -------
Interest income $ 23,007 $ 1 $ 2,442 $25,450
Interest expense 11,269 135 1,707 13,111
--------- -------- ------- -------
Net interest income 11,738 (134) 735 12,339
Provision for credit losses 9,555 0 (290) 9,265
--------- -------- ------- -------
Net interest income after
provision for credit losses 2,183 (134) 1,025 3,074
Noninterest revenues:
Securitization income 31,752 0 0 31,752
Servicing revenues 9,873 0 0 9,873
Other revenues, net 24,658 (1,242) 1,513 24,929
--------- -------- ------- -------
Total noninterest revenues 66,283 (1,242) 1,513 66,554
Expenses:
Operating expenses 55,819 1,058 318 57,195
Minority interest in income
of consolidated subsidiary 0 0 2,220 2,220
--------- -------- ------- -------
Total expenses 55,819 1,058 2,538 59,415
--------- -------- ------- -------
Income (loss) before income
taxes 12,647 (2,434) 0 10,213
Income tax expense (benefit) 4,869 (937) 0 3,932
--------- -------- ------- -------
Income (loss) from continuing
operations 7,778 (1,497) 0 6,281
Loss, net, on discontinuance of
mortgage and leasing
businesses, net of tax 0 0 (1,968) (1,968)
--------- -------- ------- -------
Net income (loss) $ 7,778 $ (1,497) $(1,968) $ 4,313
========= ======== ======= =======
Three Months Ended
June 30, 2002
----------------------------------------------------------------------
Advanta
Business Venture
Cards Capital Other(A) Total
--------- -------- ------- -------
Interest income $ 23,358 $ 0 $ 2,877 $26,235
Interest expense 8,775 181 3,413 12,369
--------- -------- ------- -------
Net interest income 14,583 (181) (536) 13,866
Provision for credit losses 11,100 0 241 11,341
--------- -------- ------- -------
Net interest income after
provision for credit losses 3,483 (181) (777) 2,525
Noninterest revenues:
Securitization income 30,023 0 0 30,023
Servicing revenues 8,143 0 0 8,143
Other revenues, net 22,921 (31) 109 22,999
--------- -------- ------- -------
Total noninterest revenues 61,087 (31) 109 61,165
Expenses:
Operating expenses 50,008 567 (688) 49,887
Minority interest in income
of consolidated subsidiary 0 0 2,220 2,220
--------- -------- ------- -------
Total expenses 50,008 567 1,532 52,107
--------- -------- ------- -------
Income (loss) before income
taxes 14,562 (779) (2,200) 11,583
Income tax expense (benefit) 5,606 (300) (847) 4,459
--------- -------- ------- -------
Income (loss) from continuing
operations 8,956 (479) (1,353) 7,124
Loss, net, on discontinuance of
mortgage and leasing
businesses, net of tax 0 0 (8,610) (8,610)
--------- -------- ------- -------
Net income (loss) $ 8,956 $ (479) $(9,963) $(1,486)
========= ======== ======= =======
(A) Other includes investment and other activities not attributable to
the Advanta Business Cards or Venture Capital segments.
ADVANTA CORP. SUPPLEMENTAL NON-GAAP DISCLOSURE ADVANTA BUSINESS CARDS MANAGED INCOME STATEMENT (in thousands) In addition to evaluating the financial performance of the Advanta Business Cards segment under generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP), we evaluate Advanta Business Cards' performance on a managed basis. Our managed receivable portfolio is comprised of both owned and securitized securitized Of, related to, or being debt securities that are secured with assets. For example, mortgage purchase bonds are secured by mortgages that have been purchased with the bond issue's proceeds. business credit card receivables. We sell business credit card receivables through securitizations accounted for as sales under GAAP. We continue to own and service the accounts that generate the securitized receivables. Managed data presents performance as if the securitized receivables had not been sold. 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. Revenue and credit data on the managed portfolio provides additional information useful in understanding the performance of the retained interests Retained interest (also colloquially known as a payout penalty) is future, currently unpaid, interest that some lenders add to the remaining principal of a loan to determine a payout figure in the event that the loan is terminated before the completion of the original term. in securitizations. A reconciliation of these managed financial measures to the most directly comparable GAAP financial measures is included in this press release.
Three Months Ended
-----------------------------
June 30, June 30,
2003 2002
------------ ------------
Interest income $ 112,826 $ 100,684
Interest expense 20,953 18,151
------------ ------------
Net interest income 91,873 82,533
Provision for credit losses 56,140 48,876
------------ ------------
Net interest income after provision
for credit losses 35,733 33,657
Noninterest revenues 32,733 30,913
------------ ------------
Risk-adjusted revenues (A) 68,466 64,570
Operating expenses 55,819 50,008
------------ ------------
Income before income taxes 12,647 14,562
Income tax expense 4,869 5,606
------------ ------------
Net income $ 7,778 $ 8,956
============ ============
Average managed business credit card
receivables $ 2,796,871 $ 2,110,420
(A) Risk-adjusted revenues represent net interest income and
noninterest revenues, less provision for credit losses.
ADVANTA CORP.
HIGHLIGHTS
(in thousands except per share data)
Three Months Ended Percent Change
-------------------------- From
June 30, Mar. 31, June 30, Prior Prior
EARNINGS 2003 2003 2002 Quarter Year
----------------------------------------------------------------------
Basic income from continuing
operations per common
share:
Class A $ 0.25 $ 0.22 $ 0.27 13.6 % (7.4)%
Class B 0.27 0.25 0.29 8.0 (6.9)
Combined (A) 0.26 0.24 0.28 8.3 (7.1)
Diluted income from
continuing operations per
common share:
Class A 0.24 0.22 0.26 9.1 (7.7)
Class B 0.26 0.25 0.27 4.0 (3.7)
Combined (A) 0.26 0.24 0.27 8.3 (3.7)
Basic net income (loss) per
common share:
Class A 0.16 0.22 (0.07) (27.3) N/M
Class B 0.19 0.25 (0.05) (24.0) N/M
Combined (A) 0.18 0.24 (0.06) (25.0) N/M
Diluted net income (loss)
per common share:
Class A 0.16 0.22 (0.06) (27.3) N/M
Class B 0.18 0.25 (0.05) (28.0) N/M
Combined (A) 0.18 0.24 (0.06) (25.0) N/M
Return on average common
equity 5.30 % 7.32 % (1.62)% (27.6) N/M
Non-GAAP financial measure:
Diluted net income from core
operations per combined
common share (B) $ 0.29 $ 0.25 $ 0.32 16.0 (9.4)
COMMON STOCK DATA
----------------------------------------------------------------------
Weighted average common
shares used to compute:
Basic earnings per common
share
Class A 9,151 9,183 9,144 (0.3)% 0.1 %
Class B 14,893 14,816 16,176 0.5 (7.9)
------- ------- -------
Total 24,044 23,999 25,320 0.2 (5.0)
Diluted earnings per
common share
Class A 9,151 9,184 9,150 (0.4) 0.0
Class B 15,445 15,212 17,640 1.5 (12.4)
------- ------- -------
Total 24,596 24,396 26,790 0.8 (8.2)
Ending shares outstanding
Class A 9,886 10,041 10,041 (1.5) (1.5)
Class B 17,274 17,141 18,521 0.8 (6.7)
------- ------- -------
Total 27,160 27,182 28,562 (0.1) (4.9)
Stock price:
Class A
High $ 10.45 $ 9.75 $ 14.55 7.2 (28.2)
Low 6.70 5.95 10.40 12.6 (35.6)
Closing 9.84 6.83 10.86 44.1 (9.4)
Class B
High 11.00 10.20 14.04 7.8 (21.7)
Low 7.47 6.91 10.24 8.1 (27.1)
Closing 9.99 7.58 10.93 31.8 (8.6)
Cash dividends declared:
Class A 0.063 0.063 0.063 0.0 0.0
Class B 0.076 0.076 0.076 0.0 0.0
Book value per common share 13.41 13.30 14.20 0.8 (5.6)
(A) Combined represents a weighted average of Class A and Class B
earnings per common share.
(B) Net income from core operations is a non-GAAP financial measure
used by management, and includes net income of the Advanta
Business Cards segment and the Venture Capital segment with the
exception of the venture capital valuation adjustments, net of
tax. Management believes the analysis of net income from core
operations provides useful supplemental information needed to make
meaningful comparisons of our current results to prior and future
periods. Venture capital valuation adjustments are excluded from
results of core operations because of their volatility related to
market conditions. Net income (loss) of the Other segment and
results of discontinued operations are also excluded, if
applicable, since they are not indicative of what is expected from
our continuing businesses on a prospective basis. A reconciliation
of non-GAAP net income from core operations to GAAP net income is
included in this press release.
N/M - Not Meaningful
ADVANTA CORP.
BUSINESS CREDIT CARD STATISTICS
(in thousands)
Three Months Ended Percent Change
----------------------------------- From
June 30, Mar. 31, June 30, Prior Prior
2003 (A) 2003 (A) 2002 Quarter Year
----------- ----------- -------------------------
Transaction volume $1,677,804 $1,602,498 $1,305,479 4.7% 28.5%
Securitization
volume (excluding
replenishment
sales) 86,182 124,775 110,000 (30.9) (21.7)
Average managed
receivables:
Owned 506,200 515,452 472,010 (1.8) 7.2
Securitized 2,290,671 2,171,815 1,638,410 5.5 39.8
---------- ---------- ----------
Managed (B) 2,796,871 2,687,267 2,110,420 4.1 32.5
Ending managed
receivables:
Owned 442,769 465,436 443,377 (4.9) (0.1)
Securitized 2,365,176 2,278,746 1,744,669 3.8 35.6
---------- ---------- ----------
Managed (B) 2,807,945 2,744,182 2,188,046 2.3 28.3
-------------------- ----------- ----------- -------------------------
CREDIT QUALITY -
OWNED
--------------------
Receivables 90 days
or more delinquent $ 13,184 $ 13,403 $ 14,703
Receivables 30 days
or more delinquent 25,839 27,846 28,739
As a percentage of
gross receivables:
Receivables 90
days or more
delinquent 2.98% 2.88% 3.32% 3.5% (10.2)%
Receivables 30
days or more
delinquent 5.84 5.98 6.48 (2.3) (9.9)
Net principal
charge-offs:
Amount $ 9,555 $ 8,408 $ 9,694
As a percentage
of average gross
receivables
(annualized) 7.55% 6.52% 8.22% 15.8 (8.2)
CREDIT QUALITY -
SECURITIZED
--------------------
Receivables 90 days
or more delinquent $ 76,459 $ 71,255 $ 58,836
Receivables 30 days
or more delinquent 150,380 146,570 115,500
As a percentage of
gross receivables:
Receivables 90
days or more
delinquent 3.23% 3.13% 3.37% 3.2% (4.2)%
Receivables 30
days or more
delinquent 6.36 6.43 6.62 (1.1) (3.9)
Net principal
charge-offs:
Amount $ 46,585 $ 45,475 $ 37,776
As a percentage
of average gross
receivables
(annualized) 8.13% 8.38% 9.22% (3.0) (11.8)
CREDIT QUALITY -
MANAGED (B)
--------------------
Receivables 90 days
or more delinquent $ 89,643 $ 84,658 $ 73,539
Receivables 30 days
or more delinquent 176,219 174,416 144,239
As a percentage of
gross receivables:
Receivables 90
days or more
delinquent 3.19% 3.08% 3.36% 3.6% (5.1)%
Receivables 30
days or more
delinquent 6.28 6.36 6.59 (1.3) (4.7)
Net principal
charge-offs:
Amount $ 56,140 $ 53,883 $ 47,470
As a percentage
of average gross
receivables
(annualized) 8.03% 8.02% 9.00% 0.1 (10.8)
(A) Prior to October 1, 2002, the billing and recognition of interest
and fees was discontinued when the related receivable became 90
days past due or upon notification of fraud, bankruptcy, death,
hardship or credit counseling. Effective October 1, 2002, we
continue to bill and recognize interest and fees on accounts when
they become 90 days past due, and an additional allowance for
receivable losses is established for the additional billings
estimated to be uncollectible through a provision for interest and
fee losses. The billing and recognition of interest and fees on
fraudulent, bankrupt, deceased, hardship and credit counseling
accounts is still discontinued upon receipt of notification of
these events. Provisions for interest and fee losses are recorded
as direct reductions to interest and fee income.
(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.
ADVANTA CORP. RECONCILIATION OF MANAGED INCOME STATEMENT AND BALANCE SHEET MEASURES TO GAAP FINANCIAL MEASURES (in thousands) In addition to evaluating the financial performance of the Advanta Business Cards segment under generally accepted accounting principles (GAAP), we evaluate Advanta Business Cards' performance on a managed basis. Our managed receivable portfolio is comprised of both owned and securitized business credit card receivables. We sell business credit card receivables through securitizations accounted for as sales under GAAP. We continue to own and service the accounts that generate the securitized receivables. Managed data presents performance as if the securitized receivables had not been sold. 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. Revenue and credit data on the managed portfolio provides additional information useful in understanding the performance of the retained interests in securitizations.
Three Months Ended
June 30, 2003
----------------------------------------------------------------------
Advanta Advanta
Business Business
Cards Securitization Cards
GAAP Adjustments Managed
-------- -------------- ---------
INCOME STATEMENT MEASURES
Interest income $23,007 $89,819 $112,826
Interest expense 11,269 9,684 20,953
Net interest income 11,738 80,135 91,873
Securitization income 31,752 (31,752) 0
Servicing revenues 9,873 (9,873) 0
Other revenues, net 24,658 8,075 32,733
Total noninterest revenues 66,283 (33,550) 32,733
Provision for credit losses 9,555 46,585 (A) 56,140
-------------------------------------
BALANCE SHEET MEASURES
Ending business credit card
receivables 442,769 2,365,176 2,807,945
Average business credit card
receivables 506,200 2,290,671 2,796,871
Business credit card
receivables:
90 days or more delinquent 13,184 76,459 89,643
30 days or more delinquent 25,839 150,380 176,219
Net principal charge-offs 9,555 46,585 56,140
Three Months Ended
June 30, 2002
---------------------------------------------------------------------
Advanta Advanta
Business Business
Cards Securitization Cards
GAAP Adjustments Managed
-------- -------------- ---------
INCOME STATEMENT MEASURES
Interest income $23,358 $77,326 $100,684
Interest expense 8,775 9,376 18,151
Net interest income 14,583 67,950 82,533
Securitization income 30,023 (30,023) 0
Servicing revenues 8,143 (8,143) 0
Other revenues, net 22,921 7,992 30,913
Total noninterest revenues 61,087 (30,174) 30,913
Provision for credit losses 11,100 37,776 (A) 48,876
-------------------------------------
BALANCE SHEET MEASURES
Ending business credit card
receivables 443,377 1,744,669 2,188,046
Average business credit card
receivables 472,010 1,638,410 2,110,420
Business credit card
receivables:
90 days or more delinquent 14,703 58,836 73,539
30 days or more delinquent 28,739 115,500 144,239
Net principal charge-offs 9,694 37,776 47,470
(A) The provision for credit losses includes the amount by which the
provision for credit losses would have been higher had the
securitized receivables remained as owned and the provision for
credit losses on securitized receivables been equal to actual
reported charge-offs.
ADVANTA CORP. RECONCILIATION OF NON-GAAP NET INCOME FROM CORE OPERATIONS TO GAAP NET INCOME Net income from core operations is a non-GAAP financial measure used by management, and includes net income of the Advanta Business Cards segment and the Venture Capital segment with the exception of the venture capital valuation adjustments, net of tax. Management believes the analysis of net income from core operations provides useful supplemental information needed to make meaningful comparisons of our current results to prior and future periods. Venture capital valuation adjustments are excluded from results of core operations because of their volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the related to market conditions. Net income (loss) of the Other segment and results of discontinued operations are also excluded, if applicable, since they are not indicative indicative: see mood. of what is expected from our continuing businesses on a prospective basis.
Three Months Three Months Three Months
Ended Ended Ended
June 30, 2003 March 31, 2003 June 30, 2002
------------------ ------------------ ------------------
Amount Per Amount Per Amount Per
Diluted Diluted Diluted
In Common In Common In Common
Thousands Share(B) Thousands Share(B) Thousands Share(B)
--------- -------- --------- -------- --------- --------
GAAP net
income
(loss) $4,313 $0.18 $5,905 $0.24 $(1,486) $(0.06)
Add back:
Other
segment
net
loss (A) 1,968 0.08 0 0.00 9,963 0.38
Valuation
adjustments
from venture
capital
investments,
net of tax
at 38.5% 764 0.03 375 0.01 19 0.00
-------- -------- -------- -------- -------- -------
Non-GAAP net
income from
core
operations $7,045 $0.29 $6,280 $0.25 $8,496 $0.32
======== ======== ======== ======== ======== =======
(A) Other segment net loss includes investment and other activities
not attributable to the Advanta Business Cards or Venture Capital
segments and loss on discontinuance of mortgage and leasing
businesses, net of tax, if applicable.
(B) The same denominator is used for both non-GAAP net income from
core operations and GAAP net income per common share calculations.
Amounts per diluted common share are calculated using total
diluted shares of 24,596 for the three months ended June 30, 2003,
24,396 for the three months ended March 31, 2003 and 26,790 for
the three months ended June 30, 2002.
Statistical Supplement available at www.advanta.com |
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