Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - MARLIN BUSINESS SERVICES CORP | f8k_110613.htm |
| EX-99.2 - EXHIBIT 99.2 - MARLIN BUSINESS SERVICES CORP | exh_992.htm |
| EX-10.1 - EXHIBIT 10.1 - MARLIN BUSINESS SERVICES CORP | exh_101.htm |
EXHIBIT 99.1
Marlin Business Services Corp. Reports Third Quarter 2013 Earnings Growth and a Cash Dividend of $0.11 Per Share
Third Quarter Highlights:
- Net income of $4.7 million for the third quarter of 2013, an increase of 37% compared to the third quarter of 2012
- New lease originations of $86.1 million for the third quarter of 2013
- Risk adjusted net interest and fee margin of 11.78% for the quarter
- $477.4 million of insured deposits, up 40% year-over-year
- Strong capital position, equity to assets ratio of 23.77%
- Total risk-based capital ratio of 27.43%
- Return on average equity of 10.32%
MOUNT LAUREL, N.J., Nov. 6, 2013 (GLOBE NEWSWIRE) -- Marlin Business Services Corp. (Nasdaq:MRLN) today reported third quarter 2013 net income of $4.7 million, or $0.36 per diluted share. Net income improved 37%, or $0.09 per diluted share over third quarter 2012. For the nine-month period ended September 30, 2013, net income was $12.8 million, or $0.99 per diluted share.
"We're pleased with the steady growth momentum of the business," says Daniel P. Dyer, co-founder and Chief Executive Officer. "Our service-oriented, focused strategy aimed at serving the credit needs of the small business marketplace continues to deliver profitable growth and attractive returns on capital," says Dyer.
Third quarter 2013 lease production was $86.1 million based on initial equipment cost, compared to $91.4 million in the second quarter of 2013 and $81.6 million in third quarter of 2012.
Net interest and fee margin of 13.44% is up 8 basis points from the second quarter of 2013 and is down 7 basis points from the third quarter of 2012. The Company's cost of funds improved 13 basis points from the second quarter of 2013 and 58 basis points from the third quarter of 2012. The improvement resulted from the Company's use of lower-cost insured deposits issued by the Company's subsidiary, Marlin Business Bank, its primary funding source.
The allowance for credit losses as a percentage of total finance receivables is 1.23% at September 30, 2013, and represents 241% of total 60+ day delinquencies.
Leases over 30 days delinquent were 0.83% of the Company's lease portfolio as of September 30, 2013, 12 basis points lower than the second quarter of 2013. Leases over 60 days delinquent were 0.45% of the Company's lease portfolio as of September 30, 2013, down 5 basis points from 0.50% at June 30, 2013. Net charge offs as a percentage of total finance receivables were 1.55% for both the third quarter ended September 30, 2013 and the second quarter ended June 30, 2013 compared to 0.89% for the third quarter ended September 30, 2012.
The Company's efficiency ratio was 49.8% for the quarter ended September 30, 2013, compared to 53.0% for the quarter ended June 30, 2013 and 56.4% for the quarter ended September 30, 2012.
The Company's consolidated equity to assets ratio is 23.77%. Our risk based capital ratio is 27.43%.
In conjunction with this release, static pool loss statistics and a vintage delinquency analysis have been updated as supplemental information on the Investor Relations section of the Company's website at www.marlincorp.com.
The Board of Directors of Marlin Business Services Corp. today declared a $0.11 per share quarterly dividend. The dividend is payable December 2, 2013, to shareholders of record on November 18, 2013. Based on the closing stock price on November 5, 2013, the annualized dividend yield on the Company's common stock is 1.66%. This is in addition to a $2.00 special dividend paid on September 26, 2013.
Conference Call and Webcast
We will host a conference call on Thursday, November 7, 2013 at 9:00 a.m. ET to discuss the Company's third quarter 2013 results. If you wish to participate, please call 877-312-5414 approximately 10 minutes in advance of the call time. The conference ID will be: "Marlin." The call will also be webcast on the Investor Relations page of the Company's website, www.marlincorp.com. An audio replay will also be available on the Investor Relations section of Marlin's website for approximately 45 days.
About Marlin Business Services Corp.
Marlin Business Services Corp. is a nationwide provider of innovative equipment financing solutions for small and mid-size businesses. Since its inception in 1997, Marlin has financed a wide array of commercial equipment and software for a quarter of a million business customers. Marlin's mission is to offer convenient and cost-effective financing products while providing the highest level of customer service. Marlin is publicly traded (Nasdaq:MRLN) and owns and operates a federally regulated commercial bank, Marlin Business Bank. For more information, visit www.marlincorp.com or call toll free at (888) 479-9111.
Forward-Looking Statements
This release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements (including statements regarding future financial and operating results) involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. All statements contained in this release that are not clearly historical in nature are forward-looking, and the words "anticipate," "believe," "expect," "estimate," "plan," "may," "intend" and similar expressions are generally intended to identify forward-looking statements. Economic, business, funding, market, competitive, legal and/or regulatory factors, among others, affecting our business are examples of factors that could cause actual results to differ materially from those described in the forward-looking statements. More detailed information about these factors is contained in our filings with the Securities and Exchange Commission, including the sections captioned "Risk Factors" and "Business" in the Company's Form 10-K filed with the Securities and Exchange Commission. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
| MARLIN BUSINESS SERVICES CORP. | ||
| AND SUBSIDIARIES | ||
| Condensed Consolidated Balance Sheets | ||
| (Unaudited) | ||
| September 30, | December 31, | |
| 2013 | 2012 | |
|
(Dollars in thousands, except per-share data) |
||
| ASSETS | ||
| Cash and due from banks | $ 2,688 | $ 2,472 |
| Interest-earning deposits with banks | 73,129 | 62,498 |
| Total cash and cash equivalents | 75,817 | 64,970 |
| Restricted interest-earning deposits with banks | 1,600 | 3,520 |
|
Securities available for sale (amortized cost of $5.8 million and $4.8 million at September 30, 2013 and December 31, 2012, respectively) |
5,459 | 4,845 |
| Net investment in leases and loans | 576,377 | 503,017 |
| Property and equipment, net | 2,502 | 1,970 |
| Property tax receivables | 4,861 | 397 |
| Other assets | 6,535 | 23,629 |
| Total assets | $ 673,151 | $ 602,348 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Deposits | $ 477,423 | $ 378,188 |
| Long-term borrowings | — | 15,514 |
| Other liabilities: | ||
| Sales and property taxes payable | 6,396 | 4,505 |
| Accounts payable and accrued expenses | 12,536 | 12,062 |
| Net deferred income tax liability | 16,817 | 17,829 |
| Total liabilities | 513,172 | 428,098 |
| Stockholders' equity: | ||
|
Common Stock, $0.01 par value; 75,000,000 shares authorized; 13,004,687 and 12,774,829 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively |
130 | 128 |
| Preferred Stock, $0.01 par value; 5,000,000 shares authorized; none issued | — | — |
| Additional paid-in capital | 90,610 | 87,494 |
| Stock subscription receivable | (2) | (2) |
| Accumulated other comprehensive income (loss) | (198) | 55 |
| Retained earnings | 69,439 | 86,575 |
| Total stockholders' equity | 159,979 | 174,250 |
| Total liabilities and stockholders' equity | $ 673,151 | $ 602,348 |
| MARLIN BUSINESS SERVICES CORP. | ||||
| AND SUBSIDIARIES | ||||
| Condensed Consolidated Statements of Operations | ||||
| (Unaudited) | ||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||
| 2013 | 2012 | 2013 | 2012 | |
| (Dollars in thousands, except per-share data) | ||||
| Interest income | $ 16,286 | $ 13,688 | $ 47,075 | $ 38,571 |
| Fee income | 3,410 | 2,966 | 9,733 | 8,854 |
| Interest and fee income | 19,696 | 16,654 | 56,808 | 47,425 |
| Interest expense | 1,036 | 1,496 | 3,458 | 5,417 |
| Net interest and fee income | 18,660 | 15,158 | 53,350 | 42,008 |
| Provision for credit losses | 2,303 | 1,414 | 6,360 | 3,546 |
| Net interest and fee income after provision for credit losses | 16,357 | 13,744 | 46,990 | 38,462 |
| Other income: | ||||
| Insurance income | 1,186 | 1,029 | 3,572 | 3,059 |
| Gain (loss) on derivatives | — | 1 | (2) | (1) |
| Other income | 386 | 452 | 1,200 | 1,119 |
| Other income | 1,572 | 1,482 | 4,770 | 4,177 |
| Other expense: | ||||
| Salaries and benefits | 6,601 | 5,988 | 19,543 | 18,683 |
| General and administrative | 3,475 | 3,390 | 10,918 | 10,174 |
| Financing related costs | 296 | 250 | 809 | 637 |
| Other expense | 10,372 | 9,628 | 31,270 | 29,494 |
| Income before income taxes | 7,557 | 5,598 | 20,490 | 13,145 |
| Income tax expense | 2,870 | 2,183 | 7,685 | 5,093 |
| Net income | $ 4,687 | $ 3,415 | $ 12,805 | $ 8,052 |
| Basic earnings per share | $ 0.37 | $ 0.27 | $ 1.00 | $ 0.63 |
| Diluted earnings per share | $ 0.36 | $ 0.27 | $ 0.99 | $ 0.63 |
| Cash dividends declared and paid per share | $ 2.11 | $ 0.08 | $ 2.31 | $ 0.20 |
| SUPPLEMENTAL QUARTERLY DATA | |||||
| (Dollars in thousands, except share amounts) | |||||
| (Unaudited) | |||||
| Quarter Ended: | 9/30/2012 | 12/31/2012 | 3/31/2013 | 6/30/2013 | 9/30/2013 |
| Net Income: | |||||
| Net Income | $3,415 | $3,645 | $3,651 | $4,467 | $4,687 |
| Annualized Performance Measures: | |||||
| Return on Average Assets | 2.50% | 2.48% | 2.38% | 2.74% | 2.73% |
| Return on Average Stockholders' Equity | 8.08% | 8.44% | 8.35% | 9.98% | 10.32% |
| EPS Data: | |||||
| Net Income Allocated to Common Stock | $3,270 | $3,497 | $3,516 | $4,292 | $4,537 |
| Number of Shares - Basic | 12,186,832 | 12,238,081 | 12,301,998 | 12,365,622 | 12,429,065 |
| Basic Earnings per Share | $0.27 | $0.29 | $0.29 | $0.35 | $0.37 |
| Number of Shares - Diluted | 12,280,123 | 12,331,766 | 12,394,959 | 12,461,892 | 12,516,186 |
| Diluted Earnings per Share | $0.27 | $0.28 | $0.28 | $0.34 | $0.36 |
| Cash Dividends Declared per share | $0.08 | $0.08 | $0.10 | $0.10 | $2.11 |
| New Asset Production: | |||||
| # of Sales Reps | 112 | 114 | 118 | 121 | 115 |
| # of Leases | 6,227 | 6,500 | 6,293 | 6,931 | 6,223 |
| Leased Equipment Volume | $81,623 | $87,771 | $80,944 | $91,448 | $86,146 |
| Approval Percentage | 67% | 67% | 67% | 67% | 65% |
| Average Monthly Sources | 1,117 | 1,207 | 1,132 | 1,247 | 1,146 |
| Implicit Yield on New Leases | 12.97% | 12.56% | 12.29% | 12.34% | 11.86% |
| Net Interest and Fee Margin: | |||||
| Interest Income Yield | 12.20% | 12.15% | 11.98% | 11.86% | 11.73% |
| Fee Income Yield | 2.64% | 2.63% | 2.52% | 2.38% | 2.46% |
| Interest and Fee Income Yield | 14.84% | 14.78% | 14.50% | 14.24% | 14.19% |
| Cost of Funds | 1.33% | 1.24% | 1.00% | 0.88% | 0.75% |
| Net Interest and Fee Margin | 13.51% | 13.54% | 13.50% | 13.36% | 13.44% |
| Average Total Finance Receivables | $448,691 | $474,225 | $502,850 | $530,463 | $555,422 |
| Average Net Investment in Leases | $448,211 | $473,699 | $502,330 | $529,910 | $554,783 |
| End of Period Net Investment in Leases | $471,545 | $502,496 | $525,381 | $555,701 | $575,718 |
| Portfolio Asset Quality: | |||||
| Total Finance Receivables | |||||
| 30+ Days Past Due Delinquencies | 0.87% | 0.92% | 0.99% | 0.95% | 0.83% |
| 30+ Days Past Due Delinquencies | $4,713 | $5,296 | $5,974 | $6,033 | $5,472 |
| 60+ Days Past Due Delinquencies | 0.40% | 0.42% | 0.57% | 0.50% | 0.45% |
| 60+ Days Past Due Delinquencies | $2,173 | $2,444 | $3,415 | $3,179 | $2,941 |
| Net Charge-offs - Total Finance Receivables | $1,003 | $1,493 | $1,568 | $2,058 | $2,147 |
| % on Average Total Finance Receivables Annualized | 0.89% | 1.26% | 1.25% | 1.55% | 1.55% |
| Allowance for Credit Losses | $5,608 | $6,488 | $7,084 | $6,919 | $7,075 |
| % of 60+ Delinquencies | 258.08% | 265.47% | 207.44% | 217.65% | 240.56% |
|
90+ Day Delinquencies (Non-earning total finance receivables) |
$989 | $1,395 | $1,628 | $1,610 | $1,697 |
| Expense Ratios: | |||||
| Salaries and Benefits Expense | $5,988 | $6,179 | $6,587 | $6,355 | $6,601 |
| Salaries and Benefits Expense Annualized % of Avg. Fin. Recbl. | 5.34% | 5.21% | 5.24% | 4.79% | 4.75% |
| Total personnel end of quarter | 258 | 265 | 272 | 281 | 275 |
| General and Administrative Expense | $3,390 | $3,374 | $3,543 | $3,900 | $3,475 |
| General and Administrative Expense Annualized % of Avg. Fin. Recbl. | 3.02% | 2.85% | 2.82% | 2.94% | 2.50% |
| Efficiency Ratio | 56.36% | 53.51% | 54.67% | 52.97% | 49.80% |
| Balance Sheet: | |||||
| Assets | |||||
| Investment in Leases and Loans | $468,722 | $500,203 | $523,475 | $553,296 | $573,325 |
| Initial Direct Costs and Fees | 8,945 | 9,302 | 9,510 | 9,932 | 10,127 |
| Reserve for Credit Losses | (5,608) | (6,488) | (7,084) | (6,919) | (7,075) |
| Net Investment in Leases and Loans | $472,059 | $503,017 | $525,901 | $556,309 | $576,377 |
| Cash and Cash Equivalents | 70,025 | 64,970 | 75,537 | 85,830 | 75,817 |
| Restricted Cash | 10,747 | 3,520 | 2,161 | 1,786 | 1,600 |
| Other Assets | 26,206 | 30,841 | 36,041 | 35,614 | 19,357 |
| Total Assets | $579,037 | $602,348 | $639,640 | $679,539 | $673,151 |
| Liabilities | |||||
| Deposits | 341,993 | 378,188 | 419,598 | 461,516 | 477,423 |
| Total Debt | $33,083 | $15,514 | $5,413 | $1,021 | $0 |
| Other Liabilities | 32,462 | 34,396 | 37,194 | 35,727 | 35,749 |
| Total Liabilities | $407,538 | $428,098 | $462,205 | $498,264 | $513,172 |
| Stockholders' Equity | |||||
| Common Stock | $127 | $128 | $129 | $129 | $130 |
| Paid-in Capital, net | 87,359 | 87,492 | 88,312 | 89,161 | 90,608 |
| Other Comprehensive Income (Loss) | 66 | 55 | 41 | (152) | (198) |
| Retained Earnings | 83,947 | 86,575 | 88,953 | 92,137 | 69,439 |
| Total Stockholders' Equity | $171,499 | $174,250 | $177,435 | $181,275 | $159,979 |
| Total Liabilities and Stockholders' Equity | $579,037 | $602,348 | $639,640 | $679,539 | $673,151 |
| Capital and Leverage: | |||||
| Equity | $171,499 | $174,250 | $177,435 | $181,275 | $159,979 |
| Debt to Equity | 2.19 | 2.26 | 2.40 | 2.55 | 2.98 |
| Equity to Assets | 29.62% | 28.93% | 27.74% | 26.68% | 23.77% |
| Regulatory Capital Ratios: | |||||
| Tier 1 Leverage Capital | 31.22% | 29.35% | 28.70% | 27.67% | 23.20% |
| Tier 1 Risk-based Capital | 33.30% | 31.76% | 30.85% | 29.73% | 26.27% |
| Total Risk-based Capital | 34.40% | 32.95% | 32.09% | 30.86% | 27.43% |
| Notes: | |||||
| Net investment in total finance receivables includes net investment in direct financing leases and loans. | |||||
CONTACT: Lynne Wilson
888 479 9111 Ext. 4108
lwilson@marlinleasing.com