American Residential Investment Trust, Inc. Reports Second Quarter Results.Business Editors DEL MAR Del Mar is the name of several places in the United States of America:
American Residential Investment Trust, Inc. (NYSE NYSE See: New York Stock Exchange : INV INV abbr. in vitro fertilization ) today announced that for the second quarter ended June 30, 2001, net operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was $1.3 million, or $0.17 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, compared to $299 thousand, or $0.04 per diluted share, for the second quarter of 2000. As previously stated, the Company does not anticipate paying dividends for the remainder of 2001. During the second quarter of 2001, American Residential ended negotiations to buy a controlling interest controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in LoanCity.com of San Jose, California San Jose (IPA: /ˌsænhoʊˈzeɪ/) is the third-largest city in California, and the tenth-largest in the United States. It is the county seat of Santa Clara County. . The Company recognized expenses of $514 thousand, or $0.06 per diluted share, from costs incurred during the review of LoanCity operations. Including these expenses, the Company earned $811 thousand for the second quarter, or $0.10 per diluted share. Year-to-date, inclusive of inclusive of prep. Taking into consideration or account; including. a charge of $1.1 million resulting from an accounting change, American Residential has lost $890 thousand, or $0.11 per diluted share, compared to net income of $1.8 million, or $0.22 per diluted share, for the first six months of 2000. The Company's total mortgage assets were $655 million at June 30, 2001 compared to $1.0 billion at June 30, 2000. In commenting on the second quarter, John M. Robbins, Jr., Chief Executive Officer of American Residential, said, "While the absolute size of our portfolio declined due to our decision to reserve capital for an origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real business, interest rate reductions by the Federal Reserve have positively affected our earnings. Our operating income increased by $0.24 per share from the first quarter. This increase was due primarily to a decline in our borrowing costs, resulting in improved interest rate spreads, and lower loan loss provisions resulting from a decline in delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. mortgages." Mr. Robbins added, "While we are pleased with the improvement in our gross operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: , it is essential to the prosperity of the Company that we continue our strategy of building a loan origination 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. capability. Although negotiations ended with LoanCity, we are still making progress on this key initiative to broaden and diversify diversify To acquire a variety of assets that do not tend to change in value at the same time. To diversify a securities portfolio is to purchase different types of securities in different companies in unrelated industries. our income stream." American Residential Investment Trust, Inc. is a real estate investment trust (REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). ) that invests primarily in non-conforming, residential mortgage assets. For more information on American Residential, please visit the Company's web site at www.amerreit.com. Certain matters discussed in this press release may constitute 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. within the meaning of federal securities laws. Forward-looking statements include statements regarding the anticipated lack of dividends in 2001, the importance of a loan origination capability to the Company's prosperity, progress on initiating a loan origination Company and income stream diversity resulting from loan originations. 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 general economic conditions, overall interest rates, the shape of the yield curve, the availability of suitable mortgage assets, the availability of financing for the acquisition of mortgage assets, the impact of leverage, the Company's ability to build a loan origination capability and other risk factors outlined in the Company's SEC reports.
AMERICAN RESIDENTIAL INVESTMENT TRUST, INC.
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
06/30/2001 06/30/2000 06/30/2001 06/30/2000
Income Statement
Interest
income $ 13,983 $ 22,296 $ 32,059 $ 47,326
Interest
expense (8,990) (17,923) (23,239) (36,779)
Gross interest
spread on mortgage
portfolio 4,993 4,373 8,820 10,547
Other interest
income 168 241 356 421
Premium
amortization (2,960) (2,497) (5,436) (5,935)
Hedging expense,
net -- (203) -- (343)
Net interest income
before provision for
loan losses 2,201 1,914 3,740 4,690
Provision for loan
losses and net
(loss) / gain on
sale-REO (681) (1,564) (2,574) (2,264)
Unrealized loss on
interest rate cap
agreements -- -- (9) --
Prepayment penalty
income 853 936 1,674 1,872
Other operating
income 91 393 253 502
Management fees (674) (1,006) (1,440) (2,098)
Loan, general &
administrative
expenses (465) (374) (914) (901)
Write-off of
acquisition
costs (514) -- (514) --
Income (loss) before
cumulative effect
of accounting
change 811 299 216 1,801
Cumulative effect of
accounting change -- -- (1,106) --
Net income
(loss) $ 811 $ 299 $ (890) $ 1,801
Per Share Data
Weighted average common
and common equivalent
shares out-
standing 7,959,900 8,055,500 7,964,988 8,055,500
Income (loss) per share
before cumulative effect
of accounting
change $ 0.10 $ 0.04 $ 0.03 $ 0.22
Income (loss) per share --
basic and
diluted $ 0.10 $ 0.04 $ (0.11) $ 0.22
Common dividend declared
for the period $ -- $ 0.20 $ -- $ 0.40
Balance Sheet Data
Total mortgage
assets 654,887 1,017,485
Total assets 681,273 1,042,631
Short-term
debt 2,212 5,640
Long-term debt,
net 600,776 949,334
Total stockholders'
equity $ 75,764 $ 85,894
Asset to equity
ratio 9.0:1 12.1:1
Total mortgage assets
purchased in
period $ -- $ -- $ -- $ --
($ in thousands, except per share data) |
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