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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): March 1, 2018 (March 1, 2018)

ALTISOURCE ASSET MANAGEMENT CORPORATION
(Exact name of Registrant as specified in its charter)

United States Virgin Islands
 
001-36063
 
66-0783125
(State or other jurisdiction of incorporation or organization)
 
(Commission File Number)
 
(I.R.S. Employer Identification No.)

5100 Tamarind Reef
Christiansted, United States Virgin Islands 00820
(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:

¨ 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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter):
 
Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 





Item 2.02 Results of Operations and Financial Condition
 
On March 1, 2018, Altisource Asset Management Corporation issued a press release announcing its financial results for the quarter and year ended December 31, 2017.  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
 
Press Release of Altisource Asset Management Corporation dated March 1, 2018




SIGNATURES

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
March 1, 2018
By:
/s/ Stephen H. Gray
 
 
Stephen H. Gray
General Counsel and Secretary



Exhibit


Exhibit 99.1

https://cdn.kscope.io/e19d4351b1620c64fc32a0cd2a7221ab-a991aamc2015earn_image1a04.jpg

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

Altisource Asset Management Corporation Reports Fourth Quarter and Full Year 2017 Results

CHRISTIANSTED, U.S. Virgin Islands, March 1, 2018 (GLOBE NEWSWIRE) - Altisource Asset Management Corporation (“AAMC” or the “Company”) (NYSE MKT: AAMC) today announced financial and operating results for the fourth quarter and full year of 2017.

Fourth Quarter 2017 Highlights and Recent Developments

•
Managed the name change of Altisource Residential Corporation to Front Yard Residential Corporation (“Front Yard”).
•
Negotiated the acquisition of 1,957 homes by Front Yard from Amherst Holdings, LLC, increasing Front Yard's rental portfolio to 11,975 homes, of which 98% were stabilized.
•
Executed Front Yard's sale of 322 mortgage loans, leaving 111 loans with a carrying value of $11.5 million at December 31, 2017 remaining in its portfolio.
•
Managed Front Yard's sale of 325 non-rental REO properties, leaving it with 490 legacy properties under evaluation for rental or sale with a carrying value of $110.1 million at year end 2017.
•
Maintained Front Yard's strong operating metrics: Stabilized Rental Net Operating Income Margin was 64.9%, Stabilized Rental Core Funds from Operations was $0.15 per diluted share and 93% of stabilized rentals were leased at December 31, 2017.

Full Year 2017 Highlights

•
Increased Front Yard's rental portfolio by 3,372 homes, a 39% increase from December 31, 2016.
•
Improved Front Yard's rental revenue by 155% over 2016 to $123.6 million.
•
Executed the disposal of substantially all of Front Yard's mortgage loans, reducing its portfolio by 96% from 3,474 loans at December 31, 2016 to 111 loans.
•
Managed Front Yard's sale of 1,710 legacy REO properties, reducing its portfolio of legacy REO properties by 75% from 1,930 properties at December 31, 2016 to 490 at December 31, 2017.
•
Completed repurchases of $5 million of AAMC stock, bringing total repurchases under the repurchase program to $265.5 million.
•
Continued to extend Front Yard's debt maturities: 77% of debt funding was over 3.9 years at December 31, 2017 compared to 46% at December 31, 2016.

“During 2017, we continued to deliver on Front Yard's strategic objectives,” stated Chief Executive Officer George Ellison. “We completed the sale of most of Front Yard's legacy assets, achieved strong growth in its rental portfolio and significantly improved its operating metrics. We expect our continued execution of Front Yard's strategic objectives will build value for AAMC's stockholders in the long term.”

Fourth Quarter and Full Year 2017 Financial Results

Net loss attributable to stockholders for the fourth quarter of 2017 totaled $1.8 million, or $1.15 per diluted share, compared to a net loss attributable to stockholders of $1.7 million, or $1.09 per diluted share, for the fourth quarter of 2016. Net loss attributable to stockholders for the year ended December 31, 2017 totaled $7.0 million, or $4.57 per diluted share, compared to net loss attributable to stockholders of $4.9 million, or $2.93 per diluted share, for the year ended December 31, 2016.





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. 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 Front Yard's ability to compete; Front Yard’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 itself or Front Yard; Front Yard’s ability to sell residential mortgage assets on favorable terms or at all; AAMC's ability to identify and acquire assets for Front Yard’s portfolio; Front Yard’s ability to complete potential transactions in accordance with anticipated terms and on a timely basis or at all; Altisource Portfolio Solutions S.A. and its affiliates’ ability to effectively perform its obligations under various agreements with Front Yard; the failure of Main Street Renewal, LLC to effectively perform under its property management agreement with Front Yard; and other risks and uncertainties detailed in the “Risk Factors” and other sections described from time to time in the Company’s current and future filings with the Securities and Exchange Commission. The foregoing list of factors should not be construed as exhaustive.


The statements made in this press release are current as of the date of this press release only. The Company undertakes no obligation to publicly update or revise any forward-looking statements or any other information contained herein, whether as a result of new information, future events or otherwise.





Altisource Asset Management Corporation
Consolidated Statements of Operations
(In thousands, except share and per share amounts)

 
Three Months Ended December 31,
 
Year Ended December 31,
 
2017
 
2016
 
2017
 
2016
 
(unaudited)
 
(unaudited)
 
 
 
 
Revenues:
 
 
 
 
 
 
 
Management fees from Front Yard
$
3,834

 
$
4,496

 
$
16,010

 
$
17,334

Conversion fees from Front Yard
90

 
445

 
1,291

 
1,841

Expense reimbursements from Front Yard
153

 
263

 
859

 
816

Total revenues
4,077

 
5,204

 
18,160

 
19,991

Expenses:
 
 
 
 
 
 
 
Salaries and employee benefits
4,390

 
4,315

 
19,393

 
17,369

Legal and professional fees
875

 
670

 
2,794

 
2,173

General and administrative
659

 
1,429

 
3,320

 
4,772

Total expenses
5,924

 
6,414

 
25,507

 
24,314

Other income:
 
 
 
 
 
 
 
Dividend income on Front Yard common stock
244

 
243

 
975

 
1,023

Other income
43

 
7

 
111

 
71

Total other income
287

 
250

 
1,086

 
1,094

Loss before income taxes
(1,560
)
 
(960
)
 
(6,261
)
 
(3,229
)
Income tax expense
224

 
703

 
708

 
1,706

Net loss attributable to stockholders
(1,784
)
 
(1,663
)
 
(6,969
)
 
(4,935
)
Amortization of preferred stock issuance costs
(51
)
 
(52
)
 
(206
)
 
(207
)
Net loss attributable to common stockholders
$
(1,835
)
 
$
(1,715
)
 
$
(7,175
)
 
$
(5,142
)
 
 
 
 
 
 
 
 
Loss per share of common stock – basic:
 
 
 
 
 
 
 
Loss per basic share
$
(1.15
)
 
$
(1.09
)
 
$
(4.57
)
 
$
(2.93
)
Weighted average common stock outstanding – basic
1,595,272

 
1,568,637

 
1,570,428

 
1,752,302

Loss per share of common stock – diluted:
 
 
 
 
 
 
 
Loss per diluted share
$
(1.15
)
 
$
(1.09
)
 
$
(4.57
)
 
$
(2.93
)
Weighted average common stock outstanding – diluted
1,595,272

 
1,568,637

 
1,570,428

 
1,752,302






Altisource Asset Management Corporation
Consolidated Balance Sheets
(In thousands, except share and per share amounts)

 
December 31, 2017
 
December 31, 2016
Current assets:
 
 
 
Cash and cash equivalents
$
33,349

 
$
40,584

Short-term investments
625

 
—

Available-for-sale securities (Front Yard common stock)
19,266

 
17,934

Receivable from Front Yard
4,151

 
5,266

Prepaid expenses and other assets
1,022

 
1,964

Total current assets
58,413

 
65,748

Other non-current assets
1,974

 
—

Total assets
$
60,387

 
$
65,748

 
 
 
 
Current liabilities:
 
 
 
Accrued salaries and employee benefits
$
5,651

 
$
4,100

Accounts payable and accrued liabilities
2,085

 
4,587

Total liabilities
7,736

 
8,687

 
 
 
 
Commitments and contingencies
—

 
—

 
 
 
 
Redeemable preferred stock:
 
 
 
Series A preferred stock, $0.01 par value, 250,000 shares issued and outstanding as of December 31, 2017 and 2016; redemption value $250,000
249,546

 
249,340

 
 
 
 
Stockholders' deficit:
 
 
 
Common stock, $.01 par value, 5,000,000 authorized shares; 2,815,122 and 1,599,210 shares issued and outstanding, respectively, as of December 31, 2017 and 2,637,629 and 1,513,912 shares issued and outstanding, respectively, as of December 31, 2016
28

 
26

Additional paid-in capital
37,765

 
30,696

Retained earnings
38,970

 
46,145

Accumulated other comprehensive loss
(1,330
)
 
(2,662
)
Treasury stock, at cost, 1,215,912 and 1,123,717 shares as of December 31, 2017 and 2016, respectively
(272,328
)
 
(266,484
)
Total stockholders' deficit
(196,895
)
 
(192,279
)
Total liabilities and equity
$
60,387

 
$
65,748