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) October 12, 1995
------------------
The CIT Group Holdings, Inc.
- ------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-1861 13-2994534
- ------------------------------------------------------------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1211 Avenue of the Americas
New York, New York 10036
- ------------------------------------------------------------------
Registrant's telephone number, including area code (212) 536-1950
---------------
- ------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events.
-------------
See attached press release.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE CIT GROUP HOLDINGS, INC.
------------------------------
(Registrant)
By /s/ JOSEPH M. LEONE
----------------------------
Joseph M. Leone
Executive Vice President and
Chief Financial Officer
Dated: October 16, 1995
<PAGE>
[Logo of The CIT Group, Inc.] Contact: Joseph M. Leone
Chief Financial Officer
(201)740-5752
FROM: THE CIT GROUP HOLDINGS, INC.
1211 AVENUE OF THE AMERICAS
NEW YORK, NY 10036
FOR IMMEDIATE RELEASE
- ---------------------
THE CIT GROUP REPORTS RECORD EARNINGS OF $58.4 MILLION FOR THIRD QUARTER 1995
-----------------------------------------------------------------------------
UP 11.1 PERCENT OVER 1994
-------------------------
NINE MONTH EARNINGS UP 10.7 PERCENT TO RECORD $167.8 MILLION
------------------------------------------------------------
NEW YORK, NEW YORK, October 12, 1995 --- The CIT Group Holdings, Inc., one
of the nation's leading asset-based finance companies, today reported record net
income of $58.4 million for the quarter ended September 30, 1995, an increase of
11.1 percent from the $52.6 million reported for the 1994 third quarter. Net
income for the first nine months of 1995, also a record, totaled $167.8 million,
an increase of 10.7 percent from $151.6 million in 1994. The 1995 earnings
reflect increased finance income from a higher level of financing and leasing
assets and continued emphasis on credit quality, offset by increased interest
expense.
"Those who predicted a recession in 1995 have been proven wrong," said
Albert R. Gamper, Jr., CIT president and chief executive officer. "CIT's
formidable performance and growth is confirmation of the underlying strength of
the economy. We expect to see this trend continuing into the fourth quarter."
<PAGE>
Other highlights:
o Financing and leasing assets totaled a record $16.80 billion, up
$1.14 billion (7.3%) from $15.66 billion at December 31, 1994. The
increase reflects continued strong volume primarily in the
Consumer Finance, Industrial Financing and Sales Financing
business units, offset, in part, by securitizations of finance
receivables.
o Net finance income rose to $178.8 million (4.60% of average
financing and leasing assets "AEA") in the 1995 third quarter,
compared to $160.8 million (4.68% of AEA) in the 1994 third
quarter. For the nine months ended September 30, 1995, net finance
income totaled $514.9 million (4.52% of AEA), compared to $486.3
million (4.83% of AEA). The changes for each period reflect the
growth in financing and leasing assets, offset by higher interest
expense.
o Fees and other income totaled $47.8 million in the third quarter
of 1995 compared with $47.0 million in 1994. For the nine months
ended September 30, 1995, fees and other income totaled $133.1
million, up slightly from $131.7 million in 1994. These increases
reflect higher gains on asset sales and fee income, offset by
lower factoring commissions.
o Salaries and general operating expenses for the third quarter and
nine months ended September 30, 1995 were relatively unchanged in
comparison to the 1994 periods. As a percent of AEA, salaries and
general operating expenses improved to 2.21 percent for the
quarter ended September 30, 1995 from 2.48 percent in 1994 and
2.22 percent for the first nine months of 1995 from 2.51 percent
for the comparable 1994 period. These improvements reflect
operating efficiencies in Commerical Services and Industrial
Financing, as well as growth of the Consumer Finance business.
-2-
<PAGE>
o Net credit losses for the third quarter of 1995 were $21.9
million, 0.57 percent of average finance receivables, up from
$18.2 million, 0.52 percent of average finance receivables for the
third quarter of 1994. Year-to-date net credit losses totaled
$56.7 million, 0.50 percent of average finance receivables, an
improvement from $67.1 million, 0.66 percent of average finance
receivables in 1994.
o Finance receivables past due 60 days or more totaled $275.5
million (1.75 percent of finance receivables) at September 30,
1995, compared with $194.9 million (1.28 percent of finance
receivables) at June 30, 1995 and $176.9 million (1.20 percent of
finance receivables) at December 31, 1994. Past due finance
receivables on nonaccrual status increased to $156.2 million (0.99
percent of finance receivables) at September 30, 1995 from $93.3
million (0.62 percent of finance receivables) at June 30, 1995 and
$110.2 million (0.75 percent of finance receivables) at year-end
1994.
o Assets received in the settlement of loans improved to $41.3
million at September 30, 1995 from $84.8 million at June 30, 1995
and $86.5 million at December 31, 1994.
o The ratio of debt-to-equity was 7.11 to 1 at September 30, 1995
compared to 7.05 to 1 at June 30, 1995 and 6.91 to 1 at December
31, 1994.
The CIT Group Holdings, Inc., one of the nation's largest asset-based
lenders, is owned 60 percent by The Dai-Ichi Kangyo Bank, Limited, one of the
largest banks in the world, and 40 percent by Chemical Banking Corporation, the
third largest bank holding company in the United States.
(SEE ATTACHED TABLES FOR ADDITIONAL FINANCIAL DATA)
# # #
-3-
<PAGE>
<TABLE>
THE CIT GROUP HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS)
THREE MONTHS ENDED
SEPTEMBER 30
-----------------------------------------------------------------
1995 % TO AEA 1994 % TO AEA
--------------------------------- ------------------------------
<S> <C> <C> <C> <C>
Finance income ............................................... $388,789 9.97%* $322,189 9.29%*
Interest expense ............................................. 210,015 5.37* 161,349 4.61*
-------- ---- -------- ----
Net finance income ......................................... 178,774 4.60 160,840 4.68
Fees and other income ........................................ 47,847 1.23 46,966 1.37
-------- ---- -------- ----
Operating revenue .......................................... 226,621 5.83 207,806 6.05
Salaries and general operating expenses ...................... 85,890 2.21 85,194 2.48
Net credit losses ............................................ 21,947 .57** 18,225 .52**
Provision for finance receivables increase ................... 2,092 .05 1,816 .05
-------- ---- -------- ----
Provision for credit losses ................................ 24,039 .62 20,041 .57
Depreciation on operating lease equipment .................... 21,462 .55 16,397 .49
-------- ---- -------- ----
Operating expenses ......................................... 131,391 3.38 121,632 3.54
-------- ---- -------- ----
Income before provision for income taxes ..................... 95,230 2.45 86,174 2.51
Provision for income taxes ................................... 36,792 .95 33,587 .98
-------- ---- -------- ----
Net income ................................................. $ 58,438 1.50% $ 52,587 1.53%
======== ==== ======== ====
Average financing and leasing assets (AEA) $15,555,094 $13,732,106
Average finance receivables $15,550,045 $14,059,245
</TABLE>
* Excludes interest income and interest expense relating
to interest-bearing deposits
** Percent to average finance receivables
-4-
<PAGE>
<TABLE>
THE CIT GROUP HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS)
NINE MONTHS ENDED
SEPTEMBER 30
---------------------------------------------------------------
1995 % TO AEA 1994 % TO AEA
------------------------------ -----------------------------
<S> <C> <C> <C> <C>
Finance income ............................................... $1,133,052 9.90%* $ 923,695 9.08%*
Interest expense ............................................. 618,202 5.38* 437,444 4.25*
---------- ---- ---------- ----
Net finance income ......................................... 514,850 4.52 486,251 4.83
Fees and other income ........................................ 133,063 1.17 131,748 1.31
---------- ---- ---------- ----
Operating revenue .......................................... 647,913 5.69 617,999 6.14
Salaries and general operating expenses ...................... 252,989 2.22 252,189 2.51
Net credit losses ............................................ 56,673 .50** 67,139 .66**
Provision for finance receivables increase ................... 10,550 .09 5,194 .05
---------- ---- ---------- ----
Provision for credit losses ................................ 67,223 .59 72,333 .71
Depreciation on operating lease equipment .................... 56,278 .49 47,275 .47
---------- ---- ---------- ----
Operating expenses ......................................... 376,490 3.30 371,797 3.69
---------- ---- ---------- ----
Income before provision for income taxes ..................... 271,423 2.39 246,202 2.45
Provision for income taxes ................................... 103,660 .92 94,609 .94
---------- ---- ---------- ----
Net income ................................................. $ 167,763 1.47% $ 151,593 1.51%
========== ==== ========== ====
Average financing and leasing assets (AEA) $15,199,974 $13,408,639
Average finance receivables $15,212,597 $13,518,880
</TABLE>
* Excludes interest income and interest expense relating
to interest-bearing deposits
** Percent to average finance receivables
-5-
<PAGE>
<TABLE>
THE CIT GROUP HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLAR AMOUNTS IN THOUSANDS)
SEPTEMBER 30, DECEMBER 31,
1995 1994
-------------- --------------
<S> <C> <C>
Assets
Financing and leasing assets
Capital Equipment Financing .................................... $ 4,466,977 $ 4,493,531
Business Credit ................................................ 1,650,080 1,442,049
Credit Finance ................................................. 766,539 719,642
------------ ------------
Corporate Finance ............................................ 6,883,596 6,655,222
Commercial Services ............................................ 1,964,553 1,896,233
Industrial Financing ........................................... 4,635,230 4,269,693
Sales Financing ................................................ 1,367,059 1,402,443
------------ ------------
Dealer and Manufacturer Financing ............................ 6,002,289 5,672,136
Consumer Finance ............................................... 930,558 570,772
------------ ------------
Finance receivables .......................................... 15,780,996 14,794,363
Reserve for credit losses ...................................... (202,142) (192,421)
------------ ------------
Net finance receivables ...................................... 15,578,854 14,601,942
Operating lease equipment ...................................... 1,017,625 867,914
------------ ------------
Net financing and leasing assets ............................. 16,596,479 15,469,856
Cash and cash equivalents ...................................... 109,652 6,558
Other assets ................................................... 535,419 487,076
------------ ------------
Total assets ................................................. $ 17,241,550 $ 15,963,490
============ ============
Liabilities and Stockholders' Equity
Debt
Commercial paper ............................................... $ 5,231,479 $ 5,660,194
Variable rate notes ............................................ 4,377,500 3,812,500
Fixed rate notes ............................................... 3,442,582 2,623,150
Subordinated fixed rate notes .................................. 300,000 300,000
------------ ------------
Total debt ................................................... 13,351,561 12,395,844
Credit balances of factoring clients ........................... 1,077,371 993,394
Accrued liabilities and payables ............................... 493,806 354,714
Deferred Federal income taxes .................................. 441,814 426,511
------------ ------------
Total liabilities ............................................ 15,364,552 14,170,463
Stockholders' equity
Common stock - authorized, issued and outstanding - 1,000 shares 250,000 250,000
Paid-in capital ................................................ 408,320 408,320
Retained earnings .............................................. 1,218,678 1,134,707
------------ ------------
Total stockholders' equity ................................... 1,876,998 1,793,027
------------ ------------
Total liabilities and stockholders' equity ................... $ 17,241,550 $ 15,963,490
============ ============
</TABLE>
-6-
