February 29, 2016

Altisource Asset Management Corporation Reports Fourth Quarter and Full Year 2015 Results

CHRISTIANSTED, U.S. Virgin Islands, Feb. 29, 2016 (GLOBE NEWSWIRE) -- Altisource Asset Management Corporation ("AAMC" or the "Company") (NYSE:AAMC) today announced financial and operating results for the fourth quarter and full year of 2015.

Fourth Quarter 2015 Highlights

  • Increased rental portfolio of Altisource Residential Corporation ("Residential") to 2,732 homes, including 2,118 rented properties, 264 listed and ready for rent and 350 properties under leasehold renovation and unit turn.
  • Reduced Residential's non-performing mortgage loan ("NPL") portfolio to 5,739 loans.1
  • Increased Residential's estimated taxable income to $37.8 million, or $0.68 per share, from $10.4 million, or $0.18 per share in the third quarter of 2015.
  • Managed the increase in Residential's rental revenue to $5.7 million, representing a 41% increase over the third quarter of 2015.
  • Facilitated Residential's completion of the sale of 772 loans within approximately 1% of its balance sheet carrying value; unpaid principal balance ("UPB") of the sold loans was $309.6 million, or approximately 15% of the total UPB in Residential's loan portfolio.
  • Negotiated Residential's agreement to purchase a portfolio of 627 rental homes; expected to close in the first quarter of 2016.2
  • Expanded Residential's One-by-One purchase program with 156 homes acquired or under contract in the fourth quarter in 9 MSAs.
  • Completed repurchases of $2.7 million of AAMC common stock, bringing total AAMC stock repurchases under the Board-approved repurchase plan to $249.1 million.

Full Year 2015 Highlights

  • Achieved estimated taxable income for Residential of $107.6 million and dividends with respect to 2015 taxable income of $1.90 per share, including the $0.15 per share special dividend announced by Residential today.
  • Increased Residential's rental portfolio to 2,732 homes as of December 31, 2015, representing an increase of 247% over the 787 properties in the rental portfolio as of December 31, 2014.
  • Executed a new Asset Management Agreement with Residential that positions AAMC for sustainable growth. Total management fees paid to AAMC were $23.7 million in 2015.
  • Facilitated Residential's servicing transfer of 6,818 loans with an aggregate UPB of $1.7 billion to two new mortgage servicers.
  • Following completed and pending NPL sales, substantially all of Residential's unsecuritized loans will have been moved to new servicers.
  • Negotiated the addition, amendment and extension of Residential's repurchase and lending facilities and completed Residential's third NPL securitization, increasing Residential's financing capacity to $1.8 billion at December 31, 2015 versus $1.6 billion at December 31, 2014.

Recent Developments

  • Negotiated Residential's agreement to sell a portfolio of 1,266 NPLs within approximately 1% of balance sheet carrying value; UPB of the loans to be sold is $434.3 million, or approximately 24% of the year-end total UPB in Residential's loan portfolio; the sale is expected to close in the first quarter of 2016.3

"In 2015, we substantially diversified Residential's acquisition strategies in light of evolving economic conditions and higher pricing in the NPL marketplace, negotiating and completing many key capital markets and financing transactions for Residential throughout the year," stated Chief Executive Officer George G. Ellison. "Although our asset management fees were lower in 2015 under the new Asset Management Agreement with Residential, we continue to believe the amended fee structure promotes the long-term stability of our client, further aligns our incentives with Residential's mission, which is to become one of the preeminent single-family rental companies in the industry and, most importantly, better positions Residential and AAMC to provide long-term value to their respective shareholders. We believe that Residential's ability to achieve its mission will be an important factor in AAMC's future growth."
_________________
1     The 5,739 NPLs excludes 1,297 loans held for sale at December 31, 2015.
2     Definitive purchase agreement was executed in February 2016. Sale is subject to completion of due diligence and expected to close in the first quarter of 2016.
3     Sale is subject to completion of due diligence and final negotiation of definitive purchase agreement. Final purchase price is subject to final confirmation

Fourth Quarter and Full Year 2015 Financial Results

Net loss attributable to stockholders for the fourth quarter of 2015 totaled $8.9 million, or $4.12 per diluted share, compared to net income attributable to stockholders of $21.9 million, or $7.92 per diluted share, for the fourth quarter of 2014. Net loss attributable to stockholders for the year ended December 31, 2015 totaled $3.3 million, or $1.59 per diluted share, compared to net income attributable to stockholders of $59.7 million, or $21.07 per diluted share, for the year ended December 31, 2014.

Webcast and Conference Call

The Company expects to host a webcast and conference call on Monday, February 29, 2016, at 10:00 a.m. Eastern Time to discuss its financial results for the fourth quarter and full year of 2015. The conference call will be webcast live over the internet from the Company's website at www.altisourceamc.com and can be accessed by clicking on the "Shareholders" link.

About AAMC

AAMC is an asset management company that provides portfolio management and corporate governance services to investment vehicles.  Additional information is available at www.altisourceamc.com.

Forward-looking Statements

This press release contains forward-looking statements that involve a number of risks and uncertainties.  Those forward-looking statements include all statements that are not historical fact, including statements about management's beliefs and expectations.  Forward-looking statements are based on management's beliefs as well as assumptions made by and information currently available to management.  Because such statements are based on expectations as to future economic performance and are not statements of historical fact, actual results may differ materially from those projected.  Residential undertakes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.  The risks and uncertainties to which forward-looking statements are subject include, but are not limited to: AAMC's ability to implement its business plan; AAMC's ability to leverage strategic relationships on an efficient and cost-effective basis; AAMC's and Residential's ability to compete; Residential's ability to implement its business plan; general economic and market conditions; governmental regulations, taxes and policies; AAMC's ability to generate adequate and timely sources of liquidity and financing for Residential; Residential's ability to sell residential mortgage assets on favorable terms; AAMC's ability to identify and acquire assets for Residential's portfolio; Altisource Portfolio Solutions' ability to effectively perform its obligations under various agreements with Residential; and other risks and uncertainties detailed in the "Forward-Looking Statements," "Risk Factors" and other sections of AAMC's Annual Reports on Form 10-K (including the Form 10-K filed today), its quarterly reports on Form 10-Q and its other filings with the Securities and Exchange Commission.

 
Altisource Asset Management Corporation
Consolidated Statements of Operations
(In thousands, except share and per share amounts)
 
 Three months ended December 31, 2015 Three months ended December 31, 2014 Year ended December 31, 2015 Year ended December 31, 2014
Revenues:       
Rental revenues$5,672  $845  $13,233  $1,564 
Net unrealized gain on mortgage loans(42,013) 91,924  88,829  350,822 
Net realized gain on mortgage loans10,533  21,899  58,061  55,766 
Net realized gain on mortgage loans held for sale35,927  2,469  36,432  2,771 
Net realized gain on real estate14,006  4,938  50,932  9,482 
Interest income17  136  612  2,893 
Total revenues24,142  122,211  248,099  423,298 
Expenses:       
Residential property operating expenses20,376  12,468  66,266  26,018 
Real estate depreciation and amortization3,080  603  7,472  1,067 
Acquisition fees and costs1,298  293  2,292  1,545 
Related party acquisition fees and costs  314    1,039 
Real estate and mortgage loan selling costs and impairment37,995  13,013  72,230  21,788 
Mortgage loan servicing costs14,357  18,593  62,346  68,181 
Interest expense14,217  11,295  53,131  35,647 
General and administrative7,425  4,020  32,896  18,346 
Related party general and administrative  574    4,446 
Total expenses98,748  61,173  296,633  178,077 
Other income  3,035    5,407 
(Loss) income before income taxes(74,606) 64,073  (48,534) 250,628 
Income tax expense114  668  354  2,096 
Net (loss) income(74,720) 63,405  (48,888) 248,532 
Net (income) loss attributable to noncontrolling interest in consolidated affiliate65,779  (41,482) 45,598  (188,853)
Net (loss) income attributable to common stockholders$(8,941) $21,923  $(3,290) $59,679 
        
(Loss) earnings per share of common stock — basic:       
(Loss) earnings per basic share$(4.12) $9.99  $(1.59) $26.31 
Weighted average common stock outstanding — basic2,180,167  2,189,318  2,202,815  2,261,968 
(Loss) earnings per share of common stock — diluted:       
(Loss) earnings per diluted share$(4.12) $7.92  $(1.59) $21.07 
Weighted average common stock outstanding — diluted2,180,167  2,768,300  2,202,815  2,832,188 
            


 
Altisource Asset Management Corporation
Consolidated Balance Sheets
(In thousands, except share and per share amounts)
 
 December 31, 2015 December 31, 2014
Assets:   
Real estate held for use:   
Land (from consolidated VIE)$56,346  $14,424 
Rental residential properties (net of accumulated depreciation of $7,127 and $1,062, respectively - from consolidated VIE)224,040  60,908 
Real estate owned (from consolidated VIE)455,483  457,045 
Total real estate held for use, net735,869  532,377 
Real estate assets held for sale (from consolidated VIE)250,557  92,230 
Mortgage loans at fair value (from consolidated VIE)960,534  1,959,044 
Mortgage loans held for sale (from consolidated VIE)317,336  12,535 
Cash and cash equivalents (including from consolidated VIE $116,702 and $66,166, respectively)184,544  116,782 
Restricted cash (from consolidated VIE)20,566  13,282 
Accounts receivable, net (including from consolidated VIE $45,903 and $10,313, respectively)46,026  11,068 
Related party receivables (from consolidated VIE)  17,491 
Deferred leasing and financing costs, net (from consolidated VIE)7,886  4,251 
Prepaid expenses and other assets (including from consolidated VIE $414 and $373, respectively)2,458  1,638 
Total assets$2,525,776  $2,760,698 
Liabilities:   
Repurchase agreements (from consolidated VIE)$767,513  $1,015,000 
Other secured borrowings (from consolidated VIE)505,630  324,082 
Accounts payable and accrued liabilities (including from consolidated VIE $32,448 and $11,678, respectively)38,722  16,726 
Related party payables (including from consolidated VIE $0 and $4,879, respectively)  6,169 
Total liabilities1,311,865  1,361,977 
Commitments and contingencies   
Redeemable preferred stock:   
Preferred stock, $0.01 par value, 250,000 shares issued and outstanding as of December 31, 2015 and 2014; redemption value $250,000249,133  248,927 
Equity:   
Common stock, $.01 par value, 5,000,000 authorized shares; 2,556,828 and 2,048,223 shares issued and outstanding, respectively, as of December 31, 2015 and 2,452,101 and 2,188,136 shares issued and outstanding, respectively as of December 31, 201426  25 
Additional paid-in capital23,419  14,152 
Retained earnings (accumulated deficit)50,678  54,174 
Treasury stock, at cost, 508,605 shares as of December 31, 2015 and 263,965 as of December 31, 2014(254,984) (245,468)
Total stockholders' equity (deficit)(180,861) (177,117)
Noncontrolling interest in consolidated affiliate1,145,639  1,326,911 
Total equity964,778  1,149,794 
Total liabilities and equity$2,525,776  $2,760,698 
 

The following tables set forth consolidating financial information which should be considered in addition to, and not as a substitute for, our consolidated financial statements presented in accordance with U.S. GAAP:

 
Altisource Asset Management Corporation
Consolidating Statement of Operations
Three months ended December 31, 2015
(In thousands, unaudited)
 
  Residential (GAAP) NewSource
Stand-alone (Non-GAAP)
  AAMC Stand-alone
(Non-GAAP)
  Consolidating Entries  AAMC Consolidated (GAAP)
Revenues:         
Rental revenues$5,672  $  $  $  $5,672 
Net unrealized loss on mortgage loans(42,013)       (42,013)
Net realized gain on mortgage loans10,533        10,533 
Net realized gain on mortgage loans held for sale35,927        35,927 
Net realized gain on real estate14,006        14,006 
Interest income16  1      17 
Conversion fee    309  (309)  
Base management fee    4,524  (4,524)  
Incentive management fee    (6,906) 6,906   
Total revenues24,141  1  (2,073) 2,073  24,142 
Expenses:         
Residential property operating expenses20,376        20,376 
Real estate depreciation and amortization3,080        3,080 
Acquisition fees and costs1,298        1,298 
Real estate and mortgage loan selling costs and impairment37,995        37,995 
Mortgage loan servicing costs14,357        14,357 
Interest expense14,217        14,217 
General and administrative1,036  41  6,348    7,425 
Related party general and administrative, net of reimbursements(2,073)     2,073   
Total expenses90,286  41  6,348  2,073  98,748 
Other income    33  (33)  
Loss before income taxes(66,145) (40) (8,388) (33) (74,606)
Income tax expense13    101    114 
Net loss(66,158) (40) (8,489) (33) (74,720)
Net loss attributable to noncontrolling interest in consolidated affiliate      65,779  65,779 
Net loss attributable to common stockholders$(66,158) $(40) $(8,489) $65,746  $(8,941)
 


 
Altisource Asset Management Corporation
Consolidating Statement of Operations
Year ended December 31, 2015
(In thousands, unaudited)
 
  Residential (GAAP) NewSource
Stand-alone (Non-GAAP)
  AAMC Stand-alone
(Non-GAAP)
  Consolidating Entries  AAMC Consolidated (GAAP)
Revenues:         
Rental revenues$13,233  $  $  $  $13,233 
Net unrealized gain on mortgage loans88,829        88,829 
Net realized gain on mortgage loans58,061        58,061 
Net realized gain on mortgage loans held for sale36,432        36,432 
Net realized gain on real estate50,932        50,932 
Interest income611  564    (563) 612 
Conversion fee    1,037  (1,037)  
Base management fee    14,565  (14,565)  
Incentive management fee    7,994  (7,994)  
Expense reimbursements    750  (750)  
Total revenues248,098  564  24,346  (24,909) 248,099 
Expenses:         
Residential property operating expenses66,266        66,266 
Real estate depreciation and amortization7,472        7,472 
Acquisition fees and costs2,292        2,292 
Real estate and mortgage loan selling costs and impairment72,230        72,230 
Mortgage loan servicing costs62,346        62,346 
Interest expense53,694      (563) 53,131 
General and administrative9,539  199  23,158    32,896 
Related party general and administrative23,716  630  2,000  (26,346)  
Total expenses297,555  829  25,158  (26,909) 296,633 
Other income3,518    211  (3,729)  
Loss before income taxes(45,939) (265) (601) (1,729) (48,534)
Income tax expense66    288    354 
Net loss(46,005) (265) (889) (1,729) (48,888)
Net loss attributable to noncontrolling interest in consolidated affiliate      45,598  45,598 
Net loss attributable to common stockholders$(46,005) $(265) $(889) $43,869  $(3,290)
 


 
Altisource Asset Management Corporation
Consolidating Statement of Operations
Three months ended December 31, 2014
(In thousands, unaudited)
 
  Residential (GAAP) NewSource
Stand-alone (Non-GAAP)
  AAMC Stand-alone
(Non-GAAP)
  Consolidating Entries  AAMC Consolidated (GAAP)
Revenues:         
Rental revenues$845  $  $  $  $845 
Net unrealized gain on mortgage loans91,924        91,924 
Net realized gain on mortgage loans21,899        21,899 
Net realized gain on mortgage loans held for sale2,469        2,469 
Net realized gain on real estate4,938        4,938 
Interest income136  156    (156) 136 
Base management fee    210    210 
Incentive management fee    23,820  (23,820)  
Expense reimbursements    1,221  (1,431) (210)
Total revenues122,211  156  25,251  (25,407) 122,211 
Expenses:         
Residential property operating expenses12,468        12,468 
Real estate depreciation and amortization603        603 
Acquisition fees and costs293        293 
Related party acquisition fees and costs314        314 
Real estate and mortgage loan selling costs and impairment13,013        13,013 
Mortgage loan servicing costs18,593        18,593 
Interest expense11,460      (165) 11,295 
General and administrative1,089  3,787  (856)   4,020 
Related party general and administrative25,087  210  528  (25,251) 574 
Total expenses82,920  3,997  (328) (25,416) 61,173 
Other income2,160  3,030  5  (2,160) 3,035 
Loss before income taxes41,451  (811) 25,584  (2,151) 64,073 
Income tax expense(31)   699    668 
Net loss41,482  (811) 24,885  (2,151) 63,405 
Net loss attributable to noncontrolling interest in consolidated affiliate      (41,482) (41,482)
Net loss attributable to common stockholders$41,482  $(811) $24,885  $(43,633) $21,923 
 


 
Altisource Asset Management Corporation
Consolidating Statement of Operations
Year ended December 31, 2014
(In thousands, unaudited)
 
  Residential (GAAP) NewSource
Stand-alone (Non-GAAP)
  AAMC Stand-alone
(Non-GAAP)
  Consolidating Entries  AAMC Consolidated (GAAP)
Revenues:         
Rental revenues$1,564  $  $  $  $1,564 
Net unrealized gain on mortgage loans350,822        350,822 
Net realized gain on mortgage loans55,766        55,766 
Net realized gain on mortgage loans held for sale2,771        2,771 
Net realized gain on real estate9,482        9,482 
Interest income2,893  156    (156) 2,893 
Base management fee    941  (941)  
Incentive management fee    67,949  (67,949)  
Expense reimbursements    6,070  (6,070)  
Total revenues423,298  156  74,960  (75,116) 423,298 
Expenses:         
Residential property operating expenses26,018        26,018 
Real estate depreciation and amortization1,067        1,067 
Acquisition fees and costs1,545        1,545 
Related party acquisition fees and costs1,039      1,039   
Real estate selling costs and impairment21,788        21,788 
Mortgage loan servicing costs68,181        68,181 
Interest expense35,812      (165) 35,647 
General and administrative5,502  4,168  8,676    18,346 
Related party general and administrative75,991  941  2,474  (73,921) 5,485
 
Total expenses236,943  5,109  11,150  (75,125) 178,077 
Other income2,543  5,015  9  (2,160) 5,407 
Income before income taxes188,898  62  63,819  (3,092) 250,628 
Income tax expense45    2,051    2,096 
Net income188,853  62  61,768  (3,092) 248,532 
Net income attributable to noncontrolling interest in consolidated affiliate      (188,853) (188,853)
Net income attributable to common stockholders$188,853  $62  $61,768  $(191,004) $59,679 
 


 
Altisource Asset Management Corporation
Consolidating Balance Sheet
December 31, 2015
(In thousands, unaudited)
 
  Residential (GAAP) NewSource
stand-alone
(non-GAAP)
  AAMC
Stand-alone

(Non-GAAP)
  Consolidating Entries  AAMC
Consolidated
(GAAP)
Assets:         
Real estate held for use:         
Land$56,346  $  $  $  $56,346 
Rental residential properties, net224,040        224,040 
Real estate owned455,483        455,483 
Total real estate held for use, net735,869        735,869 
Real estate assets held for sale250,557        250,557 
Mortgage loans at fair value960,534        960,534 
Mortgage loans held for sale317,336        317,336 
Cash and cash equivalents116,702  4,583  63,259    184,544 
Restricted cash20,566        20,566 
Accounts receivable45,903    123    46,026 
Related party receivables2,180      (2,180)  
Investment in affiliate    12,007  (12,007)  
Deferred leasing and financing costs, net7,886        7,886 
Prepaid expenses and other assets415  5  2,028  10  2,458 
Total assets$2,457,948  $4,588  $77,417  $(14,177) $2,525,776 
Liabilities:         
Repurchase agreements$767,513  $  $  $  $767,513 
Other secured borrowings505,630        505,630 
Accounts payable and accrued liabilities32,448  1,546  4,728    38,722 
Related party payables    2,180  (2,180)  
Total liabilities1,305,591  1,546  6,908  (2,180) 1,311,865 
Commitments and contingencies         
Preferred stock    249,133    249,133 
Equity:         
Common stock572    26  (572) 26 
Additional paid-in capital1,227,385  7,000  21,089  (1,232,055) 23,419 
(Accumulated deficit) retained earnings(50,617) (3,958) 55,245  50,008  50,678 
Treasury stock(24,983)   (254,984) 24,983  (254,984)
Total stockholders' equity1,152,357  3,042  (178,624) (1,157,636) (180,861)
Noncontrolling interest in consolidated affiliate      1,145,639  1,145,639 
Total equity1,152,357  3,042  (178,624) (11,997) 964,778 
Total liabilities and equity$2,457,948  $4,588  $77,417  $(14,177) $2,525,776 
 


 
Altisource Asset Management Corporation
Consolidating Balance Sheet
December 31, 2014
(In thousands, unaudited)
 
  Residential (GAAP) NewSource
stand-alone
(non-GAAP)
  AAMC
Stand-alone

(Non-GAAP)
  Consolidating Entries  AAMC
Consolidated
(GAAP)
Assets:         
Real estate held for use:         
Land$14,424  $  $  $  $14,424 
Rental residential properties, net60,908        60,908 
Real estate owned457,045        457,045 
Total real estate held for use, net532,377        532,377 
Real estate assets held for sale92,230        92,230 
Mortgage loans at fair value1,959,044        1,959,044 
Mortgage loans held for sale12,535        12,535 
Cash and cash equivalents66,166  6,026  44,590    116,782 
Restricted cash13,282        13,282 
Accounts receivable10,313  919  1  (165) 11,068 
Related party receivables17,491  14,991  28,512  (43,503) 17,491 
Investment in affiliate18,000    2,000  (20,000)  
Deferred leasing and financing costs, net4,251        4,251 
Prepaid expenses and other assets373  3  1,262    1,638 
Total assets$2,726,062  $21,939  $76,365  $(63,668) $2,760,698 
Liabilities:         
Repurchase agreements$1,015,000  $  $  $  $1,015,000 
Other secured borrowings339,082      (15,000) 324,082 
Accounts payable and accrued liabilities11,678  3,173  2,040  (165) 16,726 
Related party payables33,391  941  349  (28,512) 6,169 
Total liabilities1,399,151  4,114  2,389  (43,677) 1,361,977 
Commitments and contingencies         
Preferred stock    248,927    248,927 
Equity:         
Common stock572    25  (572) 25 
Additional paid-in capital1,227,091  20,000  14,152  (1,247,091) 14,152 
Retained earnings (accumulated deficit)99,248  (2,175) 56,340  (99,239) 54,174 
Treasury stock    (245,468)   (245,468)
Total stockholders' equity1,326,911  17,825  (174,951) (1,346,902) (177,117)
Noncontrolling interest in consolidated affiliate      1,326,911  1,326,911 
Total equity1,326,911  17,825  (174,951) (19,991) 1,149,794 
Total liabilities and equity$2,726,062  $21,939  $76,365  $(63,668) $2,760,698 
 

 

FOR FURTHER INFORMATION CONTACT:
Robin N. Lowe
Chief Financial Officer
T: 1-345-815-9919
E: Robin.Lowe@AltisourceAMC.com


Close window | Back to top

Copyright 2017 Altisource Asset Management