Advanta reports record earnings for fourth quarter and full year.
HORSHAM Horsham (hôr`shəm), town (1991 pop. 38,356) and district, West Sussex, SE England. Horsham is known primarily for its agricultural and merchandising activities, but it also serves as an engineering center. , Pa.--(BUSINESS WIRE)--Jan. 24, 1995--Advanta (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) ) Tuesday Tuesday: see week. announced record earnings for both the fourth quarter and full year 1994. For the quarter, 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. reported earnings per share of 70 cents and net income of $28.6 million, increases of 25% and 24%, respectively, over fourth quarter 1993. For the full year, earnings per share rose to $2.58 and total net income was $106.1 million, increasing 32% and 36%, respectively, over 1993 results before extraordinary item. At December December: see month. 31, 1994, the Company's portfolio of 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 increased by $2.9 billion to $8.2 billion, or 56% over December 31, 1993. Total managed credit card receivables expanded by $2.6 billion during the year, bringing total credit card outstandings to $6.5 billion at year-end year-end also year·end
The end of a year.
Occurring or done at the end of the year: a year-end audit.
Noun 1. 1994, a 67% increase.
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 chief executive officer, commented, "Advanta's sixth consecutive year of record earnings provides evidence of the Company's ability to manage sucessfully through a changing environment." Richard Greenawalt, president and chief operating officer Chief Operating Officer (COO)
The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , noted that the Company's performance in 1994 was led by strong receivable growth and improving credit quality in the credit card business. In the fourth quarter alone, Advanta expanded its credit card receivables by $1.4 billion, building a strong foundation for continued growth into the future.
Highlights include the following items:
-- Continued strong receivable growth demonstrated by the 49% year-over-year increase in total average managed receivables to $7.3 billion for the fourth quarter. From the third quarter, average managed receivables grew 17%;
-- Improved loss rates as the managed credit card charge-off Eliminate or write off.
The term charge-off is used to describe the process of removing from the records of a company something that was once regarded as an asset but has subsequently become worthless. rate fell to 2.1% in the fourth quarter from 2.9% in the year-earlier period and 2.4% in the third quarter. The consolidated managed charge-off rate declined to 2.0% in the fourth quarter, down from 2.7% in the year-earlier period and 2.2% in the third quarter;
-- The 30-plus day delinquency delinquency
Criminal behaviour carried out by a juvenile. Young males make up the bulk of the delinquent population (about 80% in the U.S.) in all countries in which the behaviour is reported. rate on managed credit cards declined to 2.0% at December 31, down from 2.4% in the year-ago quarter and 2.1% in the September quarter; the consolidated 30-plus day delinquency rate also fell, totalling 2.7% in the fourth quarter, down from 3.6% in the previous fourth quarter, and 2.9% in the third quarter;
-- The fourth quarter managed net interest margin fell to 6.06% from 7.64% in the year-earlier quarter and 6.79% in the third quarter primarily due to introductory pricing on new credit card receivables and a lag in the repricing Repricing
To change the price of an asset. In derivatives, it sometimes refers to the exchange of options of with different strike prices.
repricing associated with the increase in rates during the quarter;
-- The Company added nearly 700,000 new credit card accounts during the fourth quarter versus 310,000 in the previous year's fourth quarter and 190,000 in the third quarter; new credit card accounts generated in 1994 totalled 1.5 million versus 853,000 in 1993;
-- Disciplined cost management resulted in an operating expense Operating Expense
The essential things that a company must purchase in order to maintain business.
For example, the payment of employees wages are an operating expense.
Also known as OPEX. ratio of 3.60% in the fourth quarter, compared to 3.95% in the comparable year-ago period and 3.40% in the third quarter;
-- Return on equity of 26.6% for the quarter and 27.0% for the full year. With four million customers, $9.3 billion in managed assets and more than 1,700 employees, Advanta is a rapidly growing consumer 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. The Company's primary businesses are credit card and mortgage services, as well as small-ticket equipment leasing Equipment Leasing is a financing option to lease equipment for a certain amount of time. Leasing Benefits
ADVANTA AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Dollars in millions except per share data) Three Months Ended % Change December 31, 1994 versus 1994 1993 1993 OPERATING RESULTS Net Revenues $127.3 $ 94.8 34.3% Provision for Losses $ 6.2 $ 8.2 (24.8%) Operating Expenses(1) $ 77.7 $ 51.7 50.4% Net Income $ 28.6 $ 23.0 24.3% Earnings Per Common Share $ .70 $ .56 25.0% Average Shares 40.8 41.2 (1.1%) Return on Equity 26.56% 27.58% (3.7%) Managed Net Interest Margin 6.06 7.64 (20.7%)
Year Ended % Change December 31, 1994 versus 1994 1993 1993 OPERATING RESULTS Net Revenues(2) $447.8 $334.2 34.0% Provision for Losses $ 34.2 $ 29.8 14.8% Operating Expenses(1) $266.8 $181.2 47.3% Net Income Before extraordinary item $106.1 $ 77.9 36.1% After extraordinary item $106.1 $ 76.6 38.4% Earnings Per Common Share Before extraordinary item $ 2.58 $ 1.95 32.3% After extraordinary item $ 2.58 $ 1.92 34.4% Average Shares 41.0 39.8 3.2% Return on Equity 26.97% 27.50% (1.9%) Managed Net Interest Margin 6.72 7.77 (13.5%)
(1) Operating expenses have been restated for all periods presented to include the amortization of credit card deferred acquisition expenses which previously had been netted against net interest income.
(2) Full year 1994 figure excludes $18.4 million gain on sale of credit card relationships.
ADVANTA AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Dollars in millions except per share data) % Change December 31, December 31, 1994 versus 1994 1993 1993 FINANCIAL CONDITION Gross Receivables Owned $1,964 $1,277 53.8% Managed $8,155 $5,246 55.5% Total Assets Owned $3,094 $2,140 44.6% Managed $9,285 $6,109 52.0% Deposits $1,159 $1,255 (7.6%) Stockholders' Equity $ 442 $ 343 28.9% Book Value Per Common Share $11.12 $ 8.82 26.1% Equity/Owned Assets 14.27% 16.01% (10.9%) CREDIT QUALITY Reserves as a % of Impaired Assets Owned Credit Cards 186.5% 183.7% 1.5% Owned Mortgages 18.9% 38.2% (50.5%) Total Owned Receivables 96.1% 138.6% (30.7%) Net Charge-off Rate for the Year Managed Credit Cards 2.5% 3.5% (28.6%) Managed Mortgages 1.7% 1.3% 30.8% Total Managed Receivables 2.3% 2.9% (20.7%) 30-Plus Day Delinquency Rate Managed Credit Cards 2.0% 2.4% (16.7%) Managed Mortgages 4.9% 6.6% (25.8%) Total Managed Receivables 2.7% 3.6% (25.0%) -0- Statistical Supplement Available Upon Request
CONTACTS: Advanta, Horsham
Janet Janet: see Clouet, Jean.
JANET - Joint Academic NETwork Point, vice president
investor relations Investor relations
The process by which the corporation communicates with its investors.