American Residential Increases Full Year Guidance; 2003 Earnings Per Share Raised to $3.50-$3.75.Business Editors SAN DIEGO--(BUSINESS WIRE)--July 17, 2003 American Residential Investment Trust, Inc. (AMEX AMEX See: American Stock Exchange :INV INV abbr. in vitro fertilization ), the parent company of American Mortgage Network (AmNet), a wholesale mortgage bank serving mortgage brokers, announced today that its net income for the full year 2003 is expected to surpass previous estimates. The Company now anticipates that: -- Net income in 2003 will be in the range of $30 to $32 million, or between $3.50 and $3.75 per diluted share, inclusive of inclusive of prep. Taking into consideration or account; including. tax benefits to be recorded in the first and second quarters totaling $9.1 million, or $1.04 per diluted share. -- Second quarter net income will be approximately $9.5 million, or $1.12 per diluted share, including the realization of deferred tax assets of $2.5 million, or $0.29 per diluted share. -- Income before taxes in the second quarter will be $10.6 million, 45% higher than the first quarter, 2003. -- Book value per share is expected to be approximately $10.29 as of June 30, 2003. The Company expects 2003 net income to be between $30 and $32 million, or between $3.50 and $3.75 per diluted share. The 2003 net income forecast is inclusive of realized deferred tax assets of approximately $9.1 million, or $1.04 per diluted share. The revised 2003 guidance is based on total loan fundings of $11 to $12 billion, an assumed effective combined federal and state tax rate of approximately 31% and anticipated stock option dilution of approximately 11%. These changes are directly related to the Company's increased loan volume and profitability. The Company previously estimated that net income for the year would be between $19.8 and $21.8 million, or between $2.50 and $2.75 per diluted share, that loan fundings would be $8 to $9 billion and that its effective tax rate would be 25%. Second quarter net income is expected to be $9.5 million, inclusive of a tax benefit of $2.5 million due to the realization of deferred tax assets associated with net operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. carry forwards in American Residential Investment Trust. The deferred tax asset realization results from an anticipated increase in profitability from the Company's mortgage banking subsidiary, AmNet. Earnings per diluted share in the second quarter are expected to be $1.12, inclusive of $0.29 per diluted share associated with the tax benefit. Net income in the quarter ended June 30, 2003 was affected by the impact of a higher effective tax rate resulting from the expected increase in profitability. The Company anticipates that second quarter income before taxes will be approximately $10.6 million, up from $7.3 in the first quarter, 2003. Inclusive of the tax benefit totaling $1.04 per diluted share, earnings per share for the six months ended June 30, 2003 are expected to be $2.53, after stock option dilution resulting from significant share price appreciation during the period and a higher effective tax rate. Cash and cash equivalents are expected to be approximately $29.3 million as of June 30, 2003. Total assets are expected to increase by approximately $73 million during the second quarter, substantially due to an increase in mortgage loans held for sale and related receivables. Second quarter financial results will be issued in late July or early August. "Our income before taxes in the second quarter is expected to be 45% higher than in the first quarter of 2003, corresponding to increased loan fundings," said John M. Robbins, Chief Executive Officer. "While net income and earnings per share will be impacted by the effect of a higher estimated tax Federal and state tax laws require a quarterly payment of estimated taxes due from corporations, trusts, estates, non-wage employees, and wage employees with income not subject to withholding. rate and employee stock option dilution, we have always believed that stock options help align compensation with the creation of stockholder value. The Company continues to take advantage of favorable market conditions and is aggressively growing market share in key demographic areas." Robbins added, "Based on higher than expected net income and the continued strength of the mortgage market, which is now estimated to be $3.3 trillion in new loan originations for 2003, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the Mortgage Bankers Mortgage Banker A company, individual or institution that originates, sells and services mortgage loans. Notes: Don't confuse a mortgage banker with a mortgage broker. Association of America, we are revising our guidance upward. The housing market is very healthy, driven by low interest rates, continued appreciation in home prices, strong immigration immigration, entrance of a person (an alien) into a new country for the purpose of establishing permanent residence. Motives for immigration, like those for migration generally, are often economic, although religious or political factors may be very important. and record numbers of first-time homebuyers First-Time Homebuyer An IRA owner who is exempt from the early-distribution penalty (which applies to IRA distributions that occur before the IRA owner reaches age 59.5) for distributing funds from his or her IRA to buy, build, or rebuild a home when having had no interest in a . Our national expansion is moving ahead quickly. We expect to achieve $1 to $1.5 billion in average monthly fundings in 2004, even as the overall mortgage market returns to more normal conditions
For the second quarter of 2003, AmNet reported that it funded $3.2 billion in home mortgages compared to $2.1 billion for the first quarter of the year. In the first two quarters of 2003, AmNet funded $5.3 billion in home mortgages compared to $954 million for the same period in 2002. AmNet funded $1.3 billion of mortgages in June, compared to $878 million in May. AmNet now has a total of $1.3 billion in warehouse borrowing capacity and is licensed to do business in 46 states. About American Mortgage Network Headquartered in San Diego, California “San Diego” redirects here. For other uses, see San Diego (disambiguation). San Diego is a coastal Southern California city located in the southwestern corner of the continental United States. As of 2006, the city has a population of 1,256,951. , American Mortgage Network is a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of American Residential Investment Trust, Inc. AmNet originates loans for the national mortgage broker community through its network of branches and over the Internet. AmNet has loan production offices in Orange County, Ontario, Sacramento, and San Diego, California; Denver, Colorado; New Haven New Haven, city (1990 pop. 130,474), New Haven co., S Conn., a port of entry where the Quinnipiac and other small rivers enter Long Island Sound; inc. 1784. Firearms and ammunition, clocks and watches, tools, rubber and paper products, and textiles are among the many , Connecticut; Tampa, Florida “Tampa” redirects here. For other uses, see Tampa (disambiguation). Tampa is a United States city in Hillsborough County, on the west coast of Florida. It serves as the county seat for Hillsborough County.GR6. ; Atlanta, Georgia; Chicago, Illinois; Minneapolis, Minnesota “Minneapolis” redirects here. For other uses, see Minneapolis (disambiguation). Minneapolis (pronounced IPA: /ˌmɪniˈæpəlɪs/) is the largest city in the U.S. ; Cherry Hill Cherry Hill, township (1990 pop. 69,319), Camden co., W central N.J.; name was changed from Delaware township to Cherry Hill in 1961. Largely residential, Cherry Hill has been marked by great development and housing growth, especially since the 1970s. , New Jersey; Portland, Oregon; Providence, Rhode Island  “Providence” redirects here. For other uses, see Providence (disambiguation). Providence is the capital and the most populous city of the U.S. ; Richmond, Virginia Richmond IPA: [ɹɯʒmɐnɖ] is the capital of the Commonwealth of Virginia, in the United States. ; and Bellevue, Washington Bellevue is a rapidly growing city in King County, Washington, U.S., across Lake Washington from Seattle. Long known as a suburb or satellite city of Seattle,[1] it is now categorized as an edge city or a boomburb. . For more information, please visit www.amnetmortgage.com. About American Residential Investment Trust American Residential Investment Trust, Inc. is the parent company of American Mortgage Network. For more information, please visit www.amerreit.com. 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. Certain matters discussed in this press release may constitute forward-looking statements within the meaning of federal securities laws. Forward-looking statements include statements regarding the Company's anticipated net income, income before taxes and earnings per share for the quarter ending June 30, 2003 and for the year ending December 31, 2003, the Company's expected book value per share at June 30, 2003, the Company's expected loan fundings for 2003, the Company's anticipated combined federal and state income tax rate and stock option dilution percentages for 2003, the amount of deferred tax assets realized by the Company, the Company's earnings per share for the six months ended June 30, 2003, cash and cash equivalent balances at June 30, 2003, the change in the Company's assets from the first quarter to the second quarter of 2003, the anticipated timing of reporting second quarter 2003 financial results, the estimated 2003 mortgage market of $3.3 trillion and the Company's resulting 2003 production forecast and anticipated average monthly loan fundings in 2004. Actual results and the timing of certain events could differ materially from those projected in or contemplated by these forward-looking statements due to a number of factors, including but not limited to: uncertainty as to the percentage of the pipeline that will result in mortgage loan fundings; fluctuation in the margins, net of hedging, of loans in the Company's pipeline; the predictability of the Company's expenses; the future correlation of volatility in forward mortgage sale instruments to the Company's loan lock commitments; general economic conditions; interest rate volatility and the level of interest rates generally; the availability of financing for the origination of mortgage loans; the impact of leverage; the Company's liquidity position; the reliability of forecasting assumptions, including the anticipated earnings and net operating loss carry forwards for AmNet, used to estimate the expected effective combined federal and state income tax rate for 2003; the overall demand for mortgage loans and other risk factors outlined in American Residential Investment Trust's SEC reports. |
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