UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 23, 2013
ALTISOURCE ASSET MANAGEMENT CORPORATION
(Exact name of Registrant as specified in its charter)
United States Virgin Islands | 000-54809 | 66-0783125 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
402 Strand Street
Frederiksted, United States Virgin Islands 00840-3531
(Address of principal executive offices including zip code)
(340) 692-1055
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On July 23, 2013, Altisource Asset Management Corporation issued a press release announcing financial results for its quarter ended June 30, 2013. A copy of the press release is attached hereto as Exhibit 99.1.
The information in this Item 2.02, including the information in Exhibit 99.1, is furnished solely pursuant to Item 2.02 of this Form 8-K. Consequently, it is not deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that Section. It may only be incorporated by reference in another filing under the Securities Exchange Act of 1934 or Securities Act of 1933 if such subsequent filing specifically references this Item 2.02 of this Form 8-K.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
Exhibit No. | Description | |
Exhibit 99.1 | Press Release of Altisource Asset Management Corporation dated July 23, 2013 | |
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Altisource Asset Management Corporation | ||
Date: July 23, 2013 | By: | /s/ Stephen H. Gray |
Stephen H. Gray General Counsel and Secretary | ||
FOR IMMEDIATE RELEASE | |
FOR FURTHER INFORMATION CONTACT: Kenneth D. Najour Chief Financial Officer T: 561-682-8947 E: Kenneth.Najour@AltisourceAMC.com | |
Altisource Asset Management Corporation Reports Second Quarter 2013 Results
FREDERIKSTED, USVI July 23, 2013 (GLOBE NEWSWIRE) - Altisource Asset Management Corporation (AAMC or the Company) (OTCQX: AAMC) announced today financial and operating results for the second quarter of 2013. Net loss for the second quarter of 2013 totaled $1.5 million or $0.64 per share based on a weighted average of 2.3 million shares outstanding.
Net loss for the six months ended June 30, 2013 totaled $2.3 million or $1.00 per share based on a weighted average of 2.3 million shares outstanding.
Second quarter business performance highlights:
• | On April 5, 2013, we completed an acquisition of a portfolio of non-performing residential mortgage loans (NPLs) for Residential having an unpaid principal balance, or UPB, of $172.1 million. |
• | On May 1, 2013, we completed a follow-on equity offering for Residential of 17,250,000 shares at $18.75 per share from which Residential received net proceeds of $309.5 million. |
• | In addition, during the quarter we agreed to acquire two NPL portfolios for Residential with $470 million in UPB. These recent transactions are expected to close in July 2013. |
• | Net investment gains for the quarter totaled $8.9 million. |
Chairman William Erbey stated, "I am pleased with the continued strong performance of AAMC and its management team on behalf of Residential in NPL acquisitions, loan resolutions and capital raising, three key pillars of Residential's business. Upon closing of the most recent transactions, Residential's NPL acquisitions will total approximately 4,100 loans representing $820 million in UPB and $625 million in underlying property value. Through AAMC's efforts, Residential is well on its way to achieve its first year goal of acquiring loans that will eventually result in 5,000 rental properties."
"I am encouraged by the early results of Residential's NPL portfolio and the progress made in loan resolutions in the short time period since inception of operations," said Chief Executive Officer Ashish Pandey. "Our success in portfolio acquisitions for Residential and the positive early results in loan resolution reflect our sound execution of Residential's business plan and strategy."
Webcast and conference call
The Company will host a webcast and conference call on Tuesday, July 23, 2013, at 11:00 A.M Eastern Time to discuss its financial results for the second quarter of 2013. 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 “Shareholder” section.
About AAMC
AAMC is an asset management company that provides portfolio management and corporate governance services to investment vehicles that own real estate related assets. Its initial client is Residential, a real estate investment trust that is focused on providing affordable rental homes to families throughout the United States. 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. AAMC 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 achieve its business and strategy and implement its business plan; AAMC's ability to leverage strategic relationships on an efficient and cost-effective basis; its ability to compete; general economic and market conditions; governmental regulations, taxes and policies; availability of adequate and timely sources of liquidity and financing; and other risks and uncertainties detailed in the "Forward-Looking Statements," "Risk Factors" and other sections of AAMC's Registration Statement on Form 10, its Annual Report on Form 10-K, its Quarterly Report on Form 10-Q for the first quarter of 2013 and other filings with the Securities and Exchange Commission.
Altisource Asset Management Corporation
Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)
Three months ended June 30, 2013 | Six months ended June 30, 2013 | ||||||
Net gain on investments: | |||||||
Net unrealized gain on mortgage loans | $ | 7,165 | $ | 8,293 | |||
Net realized gain on mortgage loans | 1,719 | 2,106 | |||||
Total net gain on investments | 8,884 | 10,399 | |||||
Expenses: | |||||||
Residential rental property operating expenses | 84 | 84 | |||||
Related party mortgage loan servicing costs | 1,242 | 1,634 | |||||
Interest expense | 654 | 696 | |||||
General and administrative | 3,369 | 6,067 | |||||
Related party general and administrative | — | 207 | |||||
Total expenses | 5,349 | 8,688 | |||||
Other income | 193 | 193 | |||||
Net income | 3,677 | 1,904 | |||||
Net income attributable to noncontrolling interest in consolidated affiliate | (5,227 | ) | (4,243 | ) | |||
Net loss attributable to common stockholders | $ | (1,499 | ) | $ | (2,339 | ) | |
Loss per share of common stock – basic: | |||||||
Loss per basic share | $ | (0.64 | ) | $ | (1.00 | ) | |
Weighted average common stock outstanding – basic | 2,343,462 | 2,343,338 | |||||
Loss per share of common stock – diluted: | |||||||
Loss per diluted share | $ | (0.64 | ) | $ | (1.00 | ) | |
Weighted average common stock outstanding – diluted | 2,343,462 | 2,343,338 | |||||
Altisource Asset Management Corporation
Consolidated Balance Sheets
(In thousands, except share and per share amounts)
(Unaudited)
June 30, 2013 | December 31, 2012 | |||||
Assets: | ||||||
Land (from consolidated VIE) | $ | 4 | $ | — | ||
Rental residential properties, net (from consolidated VIE) | 54 | — | ||||
Real estate owned (from consolidated VIE) | 3,749 | — | ||||
3,807 | — | |||||
Real estate assets held for sale (from consolidated VIE) | 901 | — | ||||
Mortgage loans (from consolidated VIE) | 163,520 | — | ||||
Cash and cash equivalents (including from consolidated VIE $223,315 and $100,005, respectively) | 227,846 | 105,014 | ||||
Related party receivables (including from consolidated VIE $2,931 and $0, respectively) | 3,220 | 361 | ||||
Deferred leasing and financing costs, net (from consolidated VIE) | 868 | — | ||||
Prepaid expenses and other assets (including from consolidated VIE $20,262 and $6, respectively) | 20,857 | 440 | ||||
Total assets | 421,019 | 105,815 | ||||
Liabilities: | ||||||
Repurchase agreement (from consolidated VIE) | 472 | — | ||||
Accounts payable and accrued liabilities (including from consolidated VIE $1,138 and $46, respectively) | 2,113 | 406 | ||||
Related party payables (including from consolidated VIE $149 and $5, respectively) | 762 | 528 | ||||
Total liabilities | 3,347 | 934 | ||||
Equity: | ||||||
Common stock, $.01 par value, 5,000,000 authorized shares; and 2,345,425 and 2,343,213 shares issued and outstanding, respectively | 23 | 23 | ||||
Additional paid-in capital | 6,289 | 4,993 | ||||
Accumulated deficit | (2,385 | ) | (46 | ) | ||
Total stockholders' equity | 3,927 | 4,970 | ||||
Noncontrolling interest in consolidated affiliate | 413,745 | 99,911 | ||||
Total equity | 417,672 | 104,881 | ||||
Total liabilities and equity | $ | 421,019 | $ | 105,815 | ||
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 June 30, 2013
(Unaudited, in thousands)
Residential (GAAP) | AAMC Stand-alone (Non-GAAP) | Consolidating Entries | AAMC Consolidated (GAAP) | |||||||||
Net gain on investments: | ||||||||||||
Net unrealized gain on mortgage loans | $ | 7,165 | $ | — | $ | — | $ | 7,165 | ||||
Net realized gain on mortgage loans | 1,719 | — | — | 1,719 | ||||||||
Expense reimbursements | — | 1,156 | (1,156 | ) | — | |||||||
Total net gain on investments | 8,884 | 1,156 | (1,156 | ) | 8,884 | |||||||
Expenses: | ||||||||||||
Residential rental property operating expenses | 84 | — | — | 84 | ||||||||
Related party mortgage loan servicing costs | 1,242 | — | — | 1,242 | ||||||||
Interest expense | 654 | — | — | 654 | ||||||||
General and administrative | 714 | 2,655 | — | 3,369 | ||||||||
Related party general and administrative | 1,156 | — | (1,156 | ) | — | |||||||
Total expenses | 3,850 | 2,655 | (1,156 | ) | 5,349 | |||||||
Other income | 193 | — | — | 193 | ||||||||
Net income (loss) | 5,227 | (1,499 | ) | — | 3,728 | |||||||
Net income attributable to noncontrolling interest in consolidated affiliate | — | — | (5,227 | ) | (5,227 | ) | ||||||
Net income (loss) attributable to common stockholders | $ | 5,227 | $ | (1,499 | ) | $ | (5,227 | ) | $ | (1,499 | ) | |
Altisource Asset Management Corporation
Consolidating Statement of Operations
Six months ended June 30, 2013
(Unaudited, in thousands)
Residential (GAAP) | AAMC Stand-alone (Non-GAAP) | Consolidating Entries | AAMC Consolidated (GAAP) | |||||||||
Net gain on investments: | ||||||||||||
Net unrealized gain on mortgage loans | $ | 8,293 | $ | — | $ | — | $ | 8,293 | ||||
Net realized gain on mortgage loans | 2,106 | — | — | 2,106 | ||||||||
Expense reimbursements | — | 2,057 | (2,057 | ) | — | |||||||
Total net gain on investments | 10,399 | 2,057 | (2,057 | ) | 10,399 | |||||||
Expenses: | ||||||||||||
Residential rental property operating expenses | 84 | — | — | 84 | ||||||||
Related party mortgage loan servicing costs | 1,634 | — | — | 1,634 | ||||||||
Interest expense | 696 | — | — | 696 | ||||||||
General and administrative | 1,701 | 4,366 | — | 6,067 | ||||||||
Related party general and administrative | 2,234 | 30 | (2,057 | ) | 207 | |||||||
Total expenses | 6,349 | 4,396 | (2,057 | ) | 8,688 | |||||||
Other income | 193 | — | — | 193 | ||||||||
Net income (loss) | 4,243 | (2,339 | ) | — | 1,904 | |||||||
Net income attributable to noncontrolling interest in consolidated affiliate | — | — | (4,243 | ) | (4,243 | ) | ||||||
Net income (loss) attributable to common stockholders | $ | 4,243 | $ | (2,339 | ) | $ | (4,243 | ) | $ | (2,339 | ) | |
Altisource Asset Management Corporation
Consolidating Balance Sheet
June 30, 2013
(Unaudited, in thousands)
Residential (GAAP) | AAMC Stand-alone (Non-GAAP) | Consolidating Entries | AAMC Consolidated (GAAP) | |||||||||
Assets: | ||||||||||||
Real estate assets, net: | ||||||||||||
Land | $ | 4 | $ | — | $ | — | $ | 4 | ||||
Rental residential properties, net | 54 | — | — | 54 | ||||||||
Real estate owned | 3,749 | — | — | 3,749 | ||||||||
3,807 | — | — | 3,807 | |||||||||
Real estate assets held for sale | 901 | — | — | 901 | ||||||||
Mortgage loans | 163,520 | — | — | 163,520 | ||||||||
Cash and cash equivalents | 223,315 | 4,531 | — | 227,846 | ||||||||
Related party receivables | 3,183 | 389 | (352 | ) | 3,220 | |||||||
Deferred leasing and financing costs, net | 868 | — | — | 868 | ||||||||
Prepaid expenses and other assets | 20,262 | 595 | — | 20,857 | ||||||||
Total assets | 415,856 | 5,515 | (352 | ) | 421,019 | |||||||
Liabilities: | ||||||||||||
Repurchase agreement | 472 | — | — | 472 | ||||||||
Accounts payable and accrued liabilities | 1,138 | 975 | — | 2,113 | ||||||||
Related party payables | 501 | 613 | (352 | ) | 762 | |||||||
Total liabilities | 2,111 | 1,588 | (352 | ) | 3,347 | |||||||
Equity: | ||||||||||||
Common stock | 251 | 23 | (251 | ) | 23 | |||||||
Additional paid-in capital | 409,340 | 6,289 | (409,340 | ) | 6,289 | |||||||
Retained earnings/(accumulated deficit) | 4,154 | (2,385 | ) | (4,154 | ) | (2,385 | ) | |||||
Total stockholders' equity | 413,745 | 3,927 | (413,745 | ) | 3,927 | |||||||
Noncontrolling interest in consolidated affiliate | — | — | 413,745 | 413,745 | ||||||||
Total equity | 413,745 | 3,927 | — | 417,672 | ||||||||
Total liabilities and equity | $ | 415,856 | $ | 5,515 | $ | (352 | ) | $ | 421,019 | |||
Altisource Asset Management Corporation
Consolidating Balance Sheet
December 31, 2012
(Unaudited, in thousands)
Residential (GAAP) | AAMC Stand-alone (Non-GAAP) | Consolidating Entries | AAMC Consolidated (GAAP) | |||||||||
Assets: | ||||||||||||
Cash and cash equivalents | $ | 100,005 | $ | 5,009 | $ | — | $ | 105,014 | ||||
Related party receivables | — | 410 | (49 | ) | 361 | |||||||
Prepaid expenses and other assets | 6 | 434 | — | 440 | ||||||||
Total assets | 100,011 | 5,853 | (49 | ) | 105,815 | |||||||
Liabilities: | ||||||||||||
Accounts payable and accrued liabilities | 46 | 360 | — | 406 | ||||||||
Related party payables | 54 | 523 | (49 | ) | 528 | |||||||
Total liabilities | 100 | 883 | (49 | ) | 934 | |||||||
Equity: | ||||||||||||
Common stock | 78 | 23 | (78 | ) | 23 | |||||||
Additional paid-in capital | 99,922 | 4,993 | (99,922 | ) | 4,993 | |||||||
Deficit accumulated during the development stage | (89 | ) | (46 | ) | 89 | (46 | ) | |||||
Total stockholders' equity | 99,911 | 4,970 | (99,911 | ) | 4,970 | |||||||
Noncontrolling interest in consolidated affiliate | — | — | 99,911 | 99,911 | ||||||||
Total equity | 99,911 | 4,970 | — | 104,881 | ||||||||
Total liabilities and equity | $ | 100,011 | $ | 5,853 | $ | (49 | ) | $ | 105,815 | |||