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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: March 28, 1995
Date of earliest event reported: March 21, 1995
COUNTRYWIDE CREDIT INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-8422 95-4083087
(State or other jurisdiction (Commission (IRS Employer
of incorporation File Number) Identification Number)
155 North Lake Avenue, Pasadena, CA 91101
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(818) 304-8400
Item 5. Other Events.
A copy of a press release dated March 21, 1995, announcing the
Company's preliminary results for the fiscal year ended February 28, 1995, is
attached hereto as Exhibit 99 and is incorporated herein by this reference.
Item 7. Financial Statement and Exhibits.
(c) Exhibits
(99) Press-release dated March 21, 1995.
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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.
COUNTRYWIDE CREDIT INDUSTRIES, INC.
Dated: March 28, 1995 By: /s/
Stanford L. Kurland
Stanford L. Kurland
Senior Managing Director,
Chief Operating Officer and
Chief Financial Officer
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FOR IMMEDIATE RELEASE CONTACT: Eric Sieracki
John Dolphin
(818) 304-7523
Laura Snow
(818) 304-4422
COUNTRYWIDE CREDIT INDUSTRIES, INC.
REPORTS FOURTH QUARTER EARNINGS - DECLARES CASH DIVIDEND
PASADENA, CA (March 21, 1995) -- Countrywide Credit Industries, Inc. (NYSE:CCR),
the nation's largest residential mortgage lender and servicer, announced today
that unaudited net earnings for the fourth fiscal quarter ended February 28,
1995 were $19.4 million. Primary and fully diluted earnings per common share
were $0.21. Earnings for the quarter ended February 28, 1994 were $47.1
million, or $0.51 per primary and fully diluted share.
Unaudited net earnings for fiscal 1995 amounted to $88.4 million, down 51
percent versus the prior year. Primary and fully diluted earnings per share for
the year were $0.96. In fiscal 1994, net earnings totaled $179.5 million, or
$1.94 per fully diluted share.
Countrywide's Board of Directors declared a cash dividend of $0.08 per common
share for the fourth quarter, payable April 17, 1995 to shareholders of record
on April 3, 1995.
"In Countrywide's fourth fiscal quarter, the servicing segment highlights
included continued portfolio expansion and healthy profit margins," said David
S. Loeb, chairman. "The portfolio grew by $8 billion during the quarter and $28
billion for the fiscal year, despite difficult market conditions. Bulk
acquisitions, which complement current production and augment portfolio growth,
amounted to $4 billion for the quarter and $18 billion for the fiscal year.
Prepayments occurred at an annualized rate of only 5 percent during the quarter.
Expectations of low future prepayments contributed to a servicing asset
amortization rate of 6 percent which, coupled with modest hedge costs, resulted
in servicing margins remaining strong during the quarter.
(more)
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"Production for the quarter approached $6 billion in spite of downward seasonal
trends," Loeb continued. "More importantly, application activity reflected
steady improvement during the quarter. The daily average application rate was
$119 million in December, $125 million in January and $135 million in February.
Furthermore, this rate has increased to over $150 million month-to-date and the
pipeline currently exceeds $4 billion. As the portfolio continues to grow, the
production segment provides necessary protection for our valuable servicing
asset and remains a critical component of our counter cyclical macro-hedge.
Loss on sale of loans moderated for the quarter, but this improvement was
substantially offset by a decline in origination fees driven by a higher
percentage of third-party production. In addition, due to lower volume during
the quarter, the production segment margin rate was substantially the same as in
the third quarter despite a smaller loss.
"While fiscal 1995 was a challenging year, it was the third most profitable year
in the company's history. The industry landscape appears to be improving
because liquidations and outsourcing are reducing excess capacity and a
flattening yield curve is increasing consumer demand for fixed-rate loans. This
improving environment, combined with our business development efforts and
substantial servicing earnings, should provide a stable foundation for the
company as we enter fiscal 1996."
Countrywide ended the year with a servicing portfolio of approximately $113
billion, 34 percent higher than the portfolio it held at the end of fiscal 1994.
The weighted average coupon of the loans serviced was 7.6 percent at February
28, 1995 and 7.2 percent at February 28, 1994. In the fourth quarter,
prepayments slowed to an annualized rate of 5 percent, down from 32 percent in
the quarter ended February 28, 1994.
Of the $28 billion of loans produced during the year, 30 percent were refinances
versus 75 percent in fiscal 1994. Adjustable-rate loans accounted for 34
percent of total production during fiscal 1995 and 19 percent during fiscal
1994.
Countrywide Credit Industries, Inc., founded in 1969, originates, purchases,
sells and services loans for single-family homes.
(tables follow)
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Countrywide Credit Industries, Inc.
CONSOLIDATED INCOME STATEMENTS
(unaudited)
Three Months Twelve Months
Ended Ended
February 28, February 28,
(Dollar amounts in 1995 1994 % 1995 1994 %
thousands, except Change Change
share data)
Revenues
Loan origination
fees $35,360 $97,565 (64%) $203,426 $379,533 (46%)
Gain (loss) on
sale of loans (11,036) 22,555 (149%) (41,342) 88,212 (147%)
production revenue 24,324 120,120 (80%) 162,084 467,745 (65%)
Interest earned 97,380 108,695 (10%) 343,138 376,225 (9%)
Interest charges (83,766) (77,141) 9% (267,685) (275,906) (3%)
Net interest income 13,614 31,554 (57%) 75,453 100,319 (25%)
Loan servicing
income 118,918 86,001 38% 428,994 307,477 40%
Less
Amortization of
servicing assets (24,371) (38,742) (37%) (95,768) (242,177) (60%)
Servicing hedge
(amortization)
benefit (608) (7,500) (92%) (40,030) 73,400 (155%)
Less write-off
of servicing hedge 0 0 0% (25,600) 0 100%
Net loan
administration
income 93,939 39,759 136% 267,596 138,700 93%
Gain on sale of
servicing 0 0 0% 56,880 0 100%
Commissions,
fees and other
income 8,836 12,764 (31%) 40,650 48,816 (17%)
Total revenues 140,713 204,197 (31%) 602,663 755,580 (20%)
Expenses
Salaries and
related expenses 45,013 62,590 (28%) 199,061 227,702 (13%)
Occupancy and
other office
expenses 25,304 28,387 (11%) 102,193 101,691 0%
Guarantee fees 24,113 16,775 44% 85,831 57,576 49%
Marketing expenses 5,361 7,771 (31%) 23,217 26,030 (11%)
Branch and
administrative office
consolidation costs 0 0 0% 8,000 0 100%
Other operating
expenses 8,572 10,103 (15%) 37,016 43,481 (15%)
Total expenses 108,363 125,626 (14%) 455,318 456,480 (0%)
Earnings before
income taxes 32,350 78,571 (59%) 147,345 299,100 (51%)
Provision for
income taxes 12,940 31,428 (59%) 58,938 119,640 (51%)
NET EARNINGS $19,410 $47,143 (59%) $88,407 $179,460 (51%)
Earnings per Share
Primary $0.21 $0.51 (59%) $0.96 $1.97 (51%)
Fully Diluted $0.21 $0.51 (59%) $0.96 $1.94 (51%)
Weighted Average
Shares Outstanding
Primary 92,066,000 92,315,000 0% 92,087,000 90,501,000 2%
Fully Diluted 92,284,000 92,315,000 0% 92,216,000 92,445,000 0%
(more)
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Countrywide Credit Industries, Inc.
SELECTED OPERATING DATA (unaudited)
(Dollar amounts in thousands)
Three Months Ended Twelve Months Ended
February 28, February 28,
1995 1994 % 1995 1994 %
Change Change
Volume of loans
produced $5,784,191 $13,127,607 (56%) $27,866,170 $52,458,879 (47%)
Number of loans
produced 55,872 99,366 (44%) 250,335 382,853 (35%)
Bulk servicing
acquisitions $4,444,859 $46,998 9,358% $17,569,390 $3,432,271 412%
At February 28, 1995 1994 %
Change
Pipeline of loans-
in-process $3,640,385 $7,622,592 (52%)
Loan servicing
portfolio* $113,110,562 $84,677,802 34%
Number of loans
serviced* 987,139 697,390 42%
*Includes
warehoused loans
and loans under
subservicing
agreements.
