AMTCW Ameritrans Cap Corp 4/18/07 (MM)

Ameritrans Capital Corporation (NASDAQ: AMTC, AMTCP, AMTCW) yesterday reported financial results for the quarter ended September 30, 2006. Ameritrans reported a net loss of ($51,348) available to common shareholders for the first quarter of fiscal year 2007 or ($0.02) versus a net loss of ($75,431) or ($0.03) per basic and diluted common share for the same period of fiscal year 2006. On an operating basis, before payment of the Company�s preferred stock dividends, before provisions for income tax, the Company reported an operating profit of $35,082 for the quarter ended September 30, 2006 compared to an operating profit of $18,668 during the quarter ended September 30, 2005. The Company�s interest income for the three months ended September 30, 2006 increased $74,358 or 6% to $1,224,141 as compared to the three months ended September 30, 2005. The increase in investment income between the periods can be attributed to higher average interest rates charged on the total loan portfolio for the quarter. Fees and other income increased by $96,786 or 117% to $179,087 as compared to the three months ended September 30, 2005. The increase is primarily attributed to an increase in loan origination fees of approximately $74,000 and an increase in other income of approximately $21,000. The Company also had approximately $28,000 of other income from its share of equity in income of investee. Commenting on the results, Gary C. Granoff, Ameritrans' President, said, "During the quarter ended September 30, 2006, the Company was positively impacted by increases in interest income, fees and other income. We had positive earnings on an operating basis before taking into account payment of our preferred dividend." Mr. Granoff further stated, "We are continuing to take measures to expand our loan portfolio on a conservative but profitable basis which should continue to have a beneficial effect by increasing our gross income as transactions are completed. Our new loans in the diversified business loan area and in the Ameritrans loan portfolio are being done primarily on an adjustable basis so that periodically we will be adjusting the interest rate payable by the borrower to reflect current market rates. Our margins have leveled after a cease in the numerous increases in short term market rates of interest charged by our banks. Our interest rate swaps have assisted the Company to control our interest costs on the floating portion of our bank debt against continued upward increases in interest rates." Mr. Granoff added, "Our Chicago taxi medallion loan portfolio has continued to improve, and prices for medallions in Chicago have continued to increase. We have continued to sell off some of our medallions and we are presently in discussion with several parties regarding the sale of our remaining 24 medallions. We have very few foreclosures of medallions pending in Chicago at this time. During the quarter we further expanded the Ameritrans side of the business, with our new loans deployed at initial rates of approximately 12.5% on a weighted basis. During the quarter, we also invested approximately $1.1 million in the new area of life settlement contracts. We anticipate additional investment opportunities in the future in this area." Ameritrans Capital Corporation is a specialty finance company engaged in making loans to and investments in small businesses. Ameritrans' wholly owned subsidiary Elk Associates Funding Corporation was licensed by the United States Small Business Administration as a Small Business Investment Company (SBIC) in 1980. The Company maintains its offices at 747 Third Avenue, 4th Floor, New York, NY 10017. This announcement contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those presently anticipated or projected. Ameritrans Capital Corporation cautions investors not to place undue reliance on forward-looking statements, which speak only as to management's expectations on this date. AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2006 (UNAUDITED) AND JUNE 30, 2006 ASSETS � September 30, 2006 June 30, 2006 � Loans receivable $ 49,858,894� $ 49,855,530� Less: unrealized depreciation on loans receivable � (186,550) � (290,300) Loans receivable, net 49,672,344� 49,565,230� � Cash and cash equivalents 819,677� 846,623� Accrued interest receivable, net of unrealized depreciation of $31,500 and $31,500, respectively 671,842� 662,846� Assets acquired in satisfaction of loans 253,251� 288,251� Receivables from debtors on sales of assets acquired in satisfaction of loans 650,772� 482,525� Equity securities 1,883,604� 1,782,924� Investment in life settlement contracts 1,129,724� -� Furniture, equipment and leasehold improvements, net 223,325� 244,340� Medallions under lease 1,706,901� 1,706,901� Prepaid expenses and other assets � 453,682� � 439,171� � TOTAL ASSETS $ 57,465,122� $ 56,018,811� AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2006 (UNAUDITED) AND JUNE 30, 2006 LIABILITIES AND STOCKHOLDERS� EQUITY � September 30, 2006 June 30, 2006 LIABILITIES Debentures payable to SBA $ 12,000,000� $ 12,000,000� Notes payable, banks 22,882,500� 20,927,500� Accrued expenses and other liabilities 660,953� 880,203� Accrued interest payable 148,900� 367,465� Dividends payable � 84,375� � 84,375� � TOTAL LIABILITIES � 35,776,728� � 34,259,543� � COMMITMENTS AND CONTINGENCIES (Notes 3, 4, 5, 6 and 8) � STOCKHOLDERS' EQUITY Preferred stock 500,000 shares authorized, none issued or outstanding -� -� 9 3/8% cumulative participating callable preferred stock $ 0.01 par value, $12.00 face value, 500,000 shares authorized; 300,000 shares issued and outstanding 3,600,000� 3,600,000� Common stock, $ 0.0001 par value; 10,000,000 shares authorized; 3,401,208 shares issued and 3,391,208 shares outstanding 340� 340� Additional paid-in-capital 21,119,817� 21,119,817� Accumulated deficit (2,734,662) (2,683,314) Accumulated other comprehensive loss � (227,101) � (207,575) � 21,758,394� 21,829,268� Less: Treasury stock, at cost, 10,000 shares of common stock � (70,000) � (70,000) � TOTAL STOCKHOLDERS' EQUITY � 21,688,394� � 21,759,268� � TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 57,465,122� $ 56,018,811� AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005 (UNAUDITED) � Three Months Ended September 30, 2006 Three Months Ended September 30, 2005 � INVESTMENT INCOME Interest on loans receivable $ 1,224,141� $ 1,149,783� Fees and other income 179,087� 82,301� Leasing income � 22,971� � 49,468� � TOTAL INVESTMENT INCOME � 1,426,199� � 1,281,552� � OPERATING EXPENSES Interest 536,146� 539,273� Salaries and employee benefits 282,858� 276,238� Occupancy costs 54,638� 54,716� Professional fees 174,025� 69,812� Other administrative expenses 316,386� 281,789� Loss and impairments on assets acquired in satisfaction of loans, net 29,748� 3,000� Foreclosure expenses, net (2,466) 2,208� Write off and depreciation on interest and loans receivable � 27,921� � 35,848� � TOTAL OPERATING EXPENSES � 1,419,256� � 1,262,884� � OPERATING INCOME 6,943� 18,668� � OTHER INCOME Equity in income of investee � 28,139� � -� � INCOME BEFORE PROVISION FOR INCOME TAXES 35,082� 18,668� � PROVISION FOR INCOME TAXES � 2,055� � 9,724� NET INCOME $ 33,027� $ 8,944� � DIVIDENDS ON PREFERRED STOCK $ (84,375) $ (84,375) � NET LOSS AVAILABLE TO COMMON STOCKHOLDERS $ (51,348) $ (75,431) WEIGHTED AVERAGE SHARES OUTSTANDING - Basic � 3,391,208� � 2,035,600� - Diluted � 3,391,208� � 2,035,600� NET LOSS PER COMMON SHARE - Basic $ (0.02) $ (0.03) - Diluted $ (0.02) $ (0.03) Ameritrans Capital Corporation (NASDAQ: AMTC, AMTCP, AMTCW) yesterday reported financial results for the quarter ended September 30, 2006. Ameritrans reported a net loss of ($51,348) available to common shareholders for the first quarter of fiscal year 2007 or ($0.02) versus a net loss of ($75,431) or ($0.03) per basic and diluted common share for the same period of fiscal year 2006. On an operating basis, before payment of the Company's preferred stock dividends, before provisions for income tax, the Company reported an operating profit of $35,082 for the quarter ended September 30, 2006 compared to an operating profit of $18,668 during the quarter ended September 30, 2005. The Company's interest income for the three months ended September 30, 2006 increased $74,358 or 6% to $1,224,141 as compared to the three months ended September 30, 2005. The increase in investment income between the periods can be attributed to higher average interest rates charged on the total loan portfolio for the quarter. Fees and other income increased by $96,786 or 117% to $179,087 as compared to the three months ended September 30, 2005. The increase is primarily attributed to an increase in loan origination fees of approximately $74,000 and an increase in other income of approximately $21,000. The Company also had approximately $28,000 of other income from its share of equity in income of investee. Commenting on the results, Gary C. Granoff, Ameritrans' President, said, "During the quarter ended September 30, 2006, the Company was positively impacted by increases in interest income, fees and other income. We had positive earnings on an operating basis before taking into account payment of our preferred dividend." Mr. Granoff further stated, "We are continuing to take measures to expand our loan portfolio on a conservative but profitable basis which should continue to have a beneficial effect by increasing our gross income as transactions are completed. Our new loans in the diversified business loan area and in the Ameritrans loan portfolio are being done primarily on an adjustable basis so that periodically we will be adjusting the interest rate payable by the borrower to reflect current market rates. Our margins have leveled after a cease in the numerous increases in short term market rates of interest charged by our banks. Our interest rate swaps have assisted the Company to control our interest costs on the floating portion of our bank debt against continued upward increases in interest rates." Mr. Granoff added, "Our Chicago taxi medallion loan portfolio has continued to improve, and prices for medallions in Chicago have continued to increase. We have continued to sell off some of our medallions and we are presently in discussion with several parties regarding the sale of our remaining 24 medallions. We have very few foreclosures of medallions pending in Chicago at this time. During the quarter we further expanded the Ameritrans side of the business, with our new loans deployed at initial rates of approximately 12.5% on a weighted basis. During the quarter, we also invested approximately $1.1 million in the new area of life settlement contracts. We anticipate additional investment opportunities in the future in this area." Ameritrans Capital Corporation is a specialty finance company engaged in making loans to and investments in small businesses. Ameritrans' wholly owned subsidiary Elk Associates Funding Corporation was licensed by the United States Small Business Administration as a Small Business Investment Company (SBIC) in 1980. The Company maintains its offices at 747 Third Avenue, 4th Floor, New York, NY 10017. This announcement contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those presently anticipated or projected. Ameritrans Capital Corporation cautions investors not to place undue reliance on forward-looking statements, which speak only as to management's expectations on this date. -0- *T AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2006 (UNAUDITED) AND JUNE 30, 2006 ASSETS September June 30, 30, 2006 2006 ------------ ------------ Loans receivable $49,858,894 $49,855,530 Less: unrealized depreciation on loans receivable (186,550) (290,300) ------------ ------------ Loans receivable, net 49,672,344 49,565,230 Cash and cash equivalents 819,677 846,623 Accrued interest receivable, net of unrealized depreciation of $31,500 and $31,500, respectively 671,842 662,846 Assets acquired in satisfaction of loans 253,251 288,251 Receivables from debtors on sales of assets acquired in satisfaction of loans 650,772 482,525 Equity securities 1,883,604 1,782,924 Investment in life settlement contracts 1,129,724 - Furniture, equipment and leasehold improvements, net 223,325 244,340 Medallions under lease 1,706,901 1,706,901 Prepaid expenses and other assets 453,682 439,171 ------------ ------------ TOTAL ASSETS $57,465,122 $56,018,811 ============ ============ *T -0- *T AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2006 (UNAUDITED) AND JUNE 30, 2006 LIABILITIES AND STOCKHOLDERS' EQUITY September June 30, 30, 2006 2006 ------------ ------------ LIABILITIES Debentures payable to SBA $12,000,000 $12,000,000 Notes payable, banks 22,882,500 20,927,500 Accrued expenses and other liabilities 660,953 880,203 Accrued interest payable 148,900 367,465 Dividends payable 84,375 84,375 ------------ ------------ TOTAL LIABILITIES 35,776,728 34,259,543 ------------ ------------ COMMITMENTS AND CONTINGENCIES (Notes 3, 4, 5, 6 and 8) STOCKHOLDERS' EQUITY Preferred stock 500,000 shares authorized, none issued or outstanding - - 9 3/8% cumulative participating callable preferred stock $ 0.01 par value, $12.00 face value, 500,000 shares authorized; 300,000 shares issued and outstanding 3,600,000 3,600,000 Common stock, $ 0.0001 par value; 10,000,000 shares authorized; 3,401,208 shares issued and 3,391,208 shares outstanding 340 340 Additional paid-in-capital 21,119,817 21,119,817 Accumulated deficit (2,734,662) (2,683,314) Accumulated other comprehensive loss (227,101) (207,575) ------------ ------------ 21,758,394 21,829,268 Less: Treasury stock, at cost, 10,000 shares of common stock (70,000) (70,000) ------------ ------------ TOTAL STOCKHOLDERS' EQUITY 21,688,394 21,759,268 ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $57,465,122 $56,018,811 ============ ============ *T -0- *T AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2006 AND 2005 (UNAUDITED) Three Months Three Months Ended Ended September 30, September 30, 2006 2005 -------------- -------------- INVESTMENT INCOME Interest on loans receivable $ 1,224,141 $ 1,149,783 Fees and other income 179,087 82,301 Leasing income 22,971 49,468 -------------- -------------- TOTAL INVESTMENT INCOME 1,426,199 1,281,552 -------------- -------------- OPERATING EXPENSES Interest 536,146 539,273 Salaries and employee benefits 282,858 276,238 Occupancy costs 54,638 54,716 Professional fees 174,025 69,812 Other administrative expenses 316,386 281,789 Loss and impairments on assets acquired in satisfaction of loans, net 29,748 3,000 Foreclosure expenses, net (2,466) 2,208 Write off and depreciation on interest and loans receivable 27,921 35,848 -------------- -------------- TOTAL OPERATING EXPENSES 1,419,256 1,262,884 -------------- -------------- OPERATING INCOME 6,943 18,668 OTHER INCOME Equity in income of investee 28,139 - -------------- -------------- INCOME BEFORE PROVISION FOR INCOME TAXES 35,082 18,668 PROVISION FOR INCOME TAXES 2,055 9,724 -------------- -------------- NET INCOME $ 33,027 $ 8,944 -------------- -------------- DIVIDENDS ON PREFERRED STOCK $ (84,375) $ (84,375) -------------- -------------- NET LOSS AVAILABLE TO COMMON STOCKHOLDERS $ (51,348) $ (75,431) -------------- -------------- WEIGHTED AVERAGE SHARES OUTSTANDING - Basic 3,391,208 2,035,600 -------------- -------------- - Diluted 3,391,208 2,035,600 -------------- -------------- NET LOSS PER COMMON SHARE - Basic $ (0.02) $ (0.03) - Diluted $ (0.02) $ (0.03) ---------------------------------------- -------------- -------------- *T