FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
|X| QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT
OF 1934
For Quarter Ended: September 30, 1996
Commission File Number: 0-14786
AUTOINFO, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 13-2867481
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification number)
incorporation or organization)
1600 Route 208, Fair Lawn, New Jersey 07410
- --------------------------------------------------------------------------------
(Address of principal executive office)
(201) 703-0500
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES |X| NO |_|
Number of shares outstanding of the registrant's common stock as of
November, 11, 1996: 7,954,752 shares of common stock, $.01 par value.
This Form 10-Q/A amends Part I, Items 1 and 2 and Exhibit 11 of the Registrant's
Quarterly Report on Form 10-Q for the Fiscal Quarter ended September 30, 1996.
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
INDEX
Part I. Financial Information:
Item 1. Financial Statements: Page
----
Condensed Balance Sheet -
September 30, 1996 and December 31, 1995....................3
Condensed Statements of Operations -
Three and nine months ended September 30, 1996 and
August 31, 1995.............................................4
Condensed Statement of Changes in Financial Position Nine
months ended September 30, 1996 and August 31, 1995.........5
Notes to Unaudited Condensed Financial Statements...........6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.........................9
Part II. Other Information ..................................................12
Signatures ...........................................................13
Exhibit 11 ...........................................................14
2
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
-------------------- --------------------
Unaudited
<S> <C> <C>
ASSETS
Cash $ 89,513 $ 964,842
Short-term investments 7,890,053 23,906,459
Installment contracts receivable, net 41,009,531 25,073,858
Fixed assets, net 1,599,293 256,269
Goodwill and other intangibles, net 15,079,410 14,302,274
Other assets 3,957,082 1,291,674
-------------------- --------------------
$ 69,624,882 $ 65,795,376
==================== ====================
LIABILITIES AND STOCKHOLDERS EQUITY
Liabilities:
Revolving line of credit $ 30,404,025 $ 20,679,024
Subordinated notes and other debt 10,618,113 12,067,166
Accounts payable and accrued liabilities 813,217 1,462,555
Income taxes payable - 568,278
-------------------- --------------------
Total liabilities 41,835,355 34,777,023
-------------------- --------------------
Stockholder's Equity
Common stock - authorized 20,000,000 shares
$.01 par value; issued and outstanding -
7,954,752 as of September 30, 1996 and
7,772,752 as of December 31, 1995 79,548 77,778
Additional paid-in capital 18,171,282 17,782,677
Officer note receivable (466,797) (466,797)
Deferred compensation under stock bonus plan (390,472) (404,092)
Retained earnings 10,395,966 14,028,787
-------------------- ---------------------
Total stockholder's equity 27,789,527 31,018,353
-------------------- ---------------------
$ 69,624,882 $ 65,795,376
==================== =====================
</TABLE>
See notes to condensed unaudited financial statements
3
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, August 31, September 30, August 31,
1996 1995 1996 1995
------------------ ----------------- ------------------ ----------------
<S> <C> <C> <C> <C>
Revenues:
Interest and other finance revenue $ 8,135,400 $ - $ 3,057,362 $ --
Investment income 801,917 858,314 286,898 500,343
Long distance telephone services 399,725 682,370 119,576 199,776
------------------ ----------------- ------------------ ----------------
Total revenues 9,337,042 1,540,684 3,463,836 700,119
------------------ ----------------- ------------------ ----------------
Costs and expenses:
Interest expense 2,678,941 233,782 1,008,410 77,208
Operating expenses 4,679,836 3,479,584 1,922,315 646,589
Depreciation & amortization 814,727 16,541 325,604 3,749
Provision for credit losses 2,626,000 2,626,000
Unusual item - provision for credit losses
on acquired automobile receivables 4,300,000 2,300,000
------------------ ----------------- ------------------
Total operating expenses 15,099,504 3,729,907 8,182,329 727,546
------------------ ----------------- ------------------ ----------------
(Loss) from continuing operations (5,762,462) (2,189,223) (4,718,493) (27,427)
Provision for income taxes (benefit) (2,129,640) (381,843) (1,623,173) (158,508)
------------------ ----------------- ------------------ ----------------
(Loss) form continuing operations (3,632,822) (1,807,380) (3,095,320) 131,081
Income from discontinued operations, net -- 9,451,970 -- (28,190)
Gain on sale of discontinued operations -- 257,125 -- 257,125
------------------ ----------------- ------------------ ----------------
Net income (loss) $ (3,632,822) $ 7,901,715 $ (3,095,320) $ 360,016
================== ================= ================== ================
Net income (loss) per share:
Continuing operations $ (.46) $ (.24) $ (.39) $ .02
Discontinued operations -- 1.25 -- --
Gain on sale -- .03 -- .03
------------------ ----------------- ------------------ ----------------
Net income per share $ (.46) $ 1.04 $ (.39) $ .05
================== ================= ================== ================
Weighted average number of common
and common equivalent shares 7,918,329 7,561,477 8,000,615 7,764,045
------------------ ----------------- ------------------ ----------------
</TABLE>
See notes to condensed unaudited financial statements
4
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, 1996 August 31, 1995
------------------------- -------------------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (3,632,822) $ 7,901,715
Adjustments to reconcile net income to net cash provided by
(used in) operations
activities:
Depreciation and amortization 814,727 16,541
Amortization of deferred compensation 13,621 13,622
Gain on sale of discontinued operations -- (16,933,912)
Preferred stock investment write-off -- 1,648,797
Changes in assets and liabilities:
Installment contracts receivable (16,935,673) --
Other current assets 1,100
Other assets (2,665,408) 59,725
Income taxes payable (568,278) 565,271
Accounts payable and accrued liabilities (649,339) 362,831
------------------------- -------------------------
Net cash provided by (used in) continuing operations (23,623,172) 6,364,310
------------------------- -------------------------
Net cash used by discontinued operations and non-cash charges -- (403,400)
------------------------- -------------------------
Cash flows from investing activities:
Proceeds from sale of discontinued operations -- 34,100,000
Officer note receivable -- (466,797)
Capital expenditures (1,934,886) (13,151)
Proceeds from redemptions short term investments 22,758,488 --
Purchases of short term investments (6,742,082) (30,759,038)
------------------------- -------------------------
Net cash provided (used in) investing activities 14,081,520 (6,117,255)
Cash flows from financing activities:
Increase in (reduction of) borrowings 8,275,948 (399,638)
Issuance of common stock 390,375 --
Exercise of stock options -- 1,238,520
------------------------- -------------------------
Net cash used for financing activities 8,666,323 838,882
------------------------- -------------------------
Net increase (decrease) in cash (875,329) 188,427
Cash at beginning of period 964,842 98,516
------------------------- -------------------------
Cash at end of period $ 89,513 $ 286,943
========================= =========================
</TABLE>
See notes to condensed unaudited financial statements
5
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1. - Business and Summary of Significant Accounting Policies
Business
On December 6, 1995, AutoInfo, Inc. (the "Company"), through a wholly owned
subsidiary, acquired the operating assets of FALK Finance Company (FFC), a
Norfolk, Virginia based specialized financial services company. During the
quarter ended September 30, 1996, the Company opened its Northeast Regional
service center in Norwalk, Connecticut. As a result of this acquisition and
expansion, the Company's primary business is to purchase non-prime automobile
retail installment contracts from new and used automobile dealers. The Company
services these dealers by providing specialized financing programs for buyers
who typically have impaired credit histories and are unable to access
traditional sources of available consumer credit. The Company also provides long
distance telephone communication services which are marketed through an
independent commissioned sales force.
Prior Disposition of Businesses
During the fiscal year ended May 31, 1995 and on July 20, 1995, the Company sold
substantially all of its then existing operating assets for $34,100,000 in cash
in two separate transactions.
Principles of Consolidation
The consolidated financial include the accounts of the Company and its
subsidiaries, all of which are wholly-owned. All significant intercompany
balances and transactions have been eliminated in consolidation.
Installment Contracts Receivable
Installment contracts receivable represent retail installment sales contracts
purchased from new and used automobile dealers at discounts ranging from 5% to
20%.
Allowance for Credit Losses
The Company established an allowance for credit losses based upon an evaluation
of a number of factors including prior loss experience, contractual
delinquencies, the value of underlying collateral and other factors. All
discounts on the purchase of installment contracts from dealers are added to the
allowance. The allowance is evaluated for adequacy based upon estimated future
losses inherent in the existing finance receivable portfolio. A provision for
losses, if any, is charged to income in order to maintain the allowance at an
adequate level.
Revenue Recognition
The Company recognizes interest income from installment contracts receivable on
the interest method. The accrual of interest income is suspended when a loan is
ninety days contractually delinquent. All discounts on the purchase of
installment contracts from dealers are held in reserve and are considered to
cover future anticipated credit losses. The Company recognizes revenue from long
distance telephone communications when services are rendered.
6
<PAGE>
Goodwill and Other Intangibles
The excess of cost over the fair value of net assets acquired is allocated to
goodwill and other intangibles and is being amortized using the straight-line
method over periods of up to twenty years. In March 1995, the Financial
Accounting Standards Board issued SFAS No. 121 "Accounting for the Impairment of
Long-Lived Assets to Be Disposed Of". This statement requires that long-lived
assets and certain identifiable intangibles to be held and used by an entity be
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. The Company adopted
SFAS No. 121 to evaluate the carrying amount of goodwill commencing with the
period ended December 31, 1995 and no impairment of goodwill existed as of
December 31, 1995 or September 30, 1996.
Fiscal Year
On February 28, 1996, the Company made an election to change its fiscal year-end
from May 31 to December 31. The Company believes that this change provides
shareholders with information on a basis more comparable to other public
entities in the specialized automobile finance industry. The Company will
continue to present the most comparable prior fiscal year period, the three and
nine month periods ended August 31, 1995 for this Form 10-Q Report.
Note 2 - General
The accompanying unaudited condensed financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and the instructions for Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments consisting of normal recurring
accruals considered necessary for a fair presentation have been included.
Operating results for the three and nine months ended September 30, 1996 and
August 31, 1995 are not necessarily indicative of the results that may be
expected for a full fiscal year. For further information, refer to the financial
statement and footnotes thereto included in the Company's transition period
report on Form 10-K for the seven month period ended December 31, 1995.
Note 3 - Marketable Securities
Effective September 1, 1994, the Company, as required, adopted Statement of
Financial Accounting Standards (SFAS) No. 115, "Accounting for Certain
Investments in Debt and Equity Securities". This pronouncement establishes the
accounting and reporting for investments in equity securities that have readily
determinable fair values and for all investments in debt securities. This
statement supersedes Statement No. 12 "Accounting for Certain Marketable
Securities".
In connection with the adoption of SFAS No. 115, debt and equity
securities used as part of the Company's investment management that may be sold
in response to cash needs, changes in interest rates, and other factors have
been classified as securities available for sale. Such securities are reported
at cost which approximates fair value and have maturities of less than one year
and included common stock and bond funds ($3,864,226 as of September 30, 1996
and $3,613,394 as of December 31, 1995), money market instruments ($1,675,226 as
of September 30, 1996 and $4,585,558 as of December 31, 1995) and municipal
bonds ($2,350,601 as of September 30, 1996 and $15,727,507 as of December 31,
1995). As of September 30, 1996 and December 31, 1995, unrealized gains and
losses were not material. Unrealized gains and losses, if material, would be
excluded from earnings and reported as a separate component of stockholders'
equity. During the nine month period ended September 30, 1996, there were no
material gains or losses arising from the disposition of marketable securities.
Gains and losses on disposition of securities are recognized on the specific
identification method in the period in which they occur.
7
<PAGE>
Note 4 - Installment Contracts Receivable
The following is a summary of installment contracts receivable as of September
30, 1996 and December 31, 1995:
September 30, 1996 December 31, 1995
------------------ -----------------
Gross installment contracts receivable $ 70,042,865 $ 44,070,860
Less: Unearned finance charges and fees (17,598,173) (12,178,807)
Less: Allowance for credit losses (11,435,161) (6,818,195)
------------------- ---------------
Installment contracts receivable, net $ 41,009,531 $ 25,073,858
------------------- ---------------
Note 5 -Unusual Item - Additional Credit Losses On Acquired Automobile
Receivables
The acquisition of FFC in December 1995 included a portfolio of non-prime
automobile receivables of approximately $31 million of which 80% had been
acquired by FFC from Charlie Falk Auto Wholesale, Incorporated ("CFAW"), the
prior majority owner of FFC. During the quarters ended June 30, 1996 and
September 30, 1996, the quality of this portfolio as evidenced by the number of
repossessions and the charge-off losses incurred resulted in the Company
recording additional credit losses of $4,300,000 of which $2,300,000 was
recorded in the three months ended September 30, 1996.
Note 6 - Subsequent Event
On October 11, 1996, the Company, effected a securitization of approximately $40
million of its installment contract receivables (the "Receivables") in a private
placement of $36 million principal amount of notes through Black Diamond
Securities, Inc. and Alex Brown & Sons, Incorporated, as Placement Agents. In
connection with the securitization, AutoInfo Receivables Company, a bankruptcy
remote special purpose wholly-owned subsidiary of the Company, acquired the
receivables from AutoInfo Finance of Virginia, Inc,, a wholly-owned subsidiary
of the Company, with the proceeds from its sale of notes issued by AutoInfo
Receivables Company. The notes were comprised of approximately $34 million of
"AAA/Aaa" rated MBIA insured Class A notes and approximately $2 million of "BB"
rated Class B notes. The notes bear interest on a weighted average basis at 6.8%
per annum and have a maturity date of January 15, 2002. The net proceeds from
the sale of the Receivables have been allocated for general corporate purposes,
including, but not limited to, repayment of indebtedness, purchase of additional
installment contract receivables and general working capital purposes. The
Company did not recognize any gain as a result of the transaction and will
continue to reflect the Receivables on its consolidated balance sheet.
8
<PAGE>
Note 7 - Reconciliation of Previously Reported Data
The following table reconciles summary financial data with amounts previously
reported:
<TABLE>
<CAPTION>
For the three months ended For the nine months ended
September 30, 1996 September 30, 1996
As As
Previously Adjustment As Previously Adjustment As
Reported Restated Reported Restated
----------------------------------------- ------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Revenues $ 3,592,836 $ (129,000) $ 3,463,836 $ 9,576,042 $ (239,000) $ 9,337,042
Income (loss) from operations 336,507 (5,055,000) (4,718,493) 1,402,538 (7,165,000) (5,764,462)
Net income (loss) 235,855 (3,331,175) (3,095,320) 1,091,010 (4,723,832) (3,632,822)
Net income (loss) per share .03 (.42) (.39) .14 (.60) (.46)
</TABLE>
The adjustments consist of an interest rate yield reduction ($129,000 and
$239,000, respectively), a provision for credit losses on the automobile
receivables acquired from FFC ($2,300,000 and $4,300,000, respectively) and a
provision for credit losses for the current portfolios of $2,626,000 in both
periods.
9
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition
And
Results of Operations
Liquidity and Capital Resources
The Company's liquid assets amounted to $7.9 million as of September 30, 1996.
The Company has sufficient liquid assets to meet its short term capital
requirements and available lines of credit to meet its long term capital
requirements.
The total amount of debt outstanding as of September 30, 1996 was $41.0 million,
none of which is due in less than one year. This debt was comprised of a senior
credit facility of $30.4 million and subordinated notes of $8.2 million included
in the liabilities assumed with the acquisition of FFC in December 1995, $2
million of subordinated notes issued by the Company in January 1994 and $400
thousand of equipment notes issued during the quarter ended September 30, 1996.
The Company retired $1.6 million of subordinated notes during the three months
ended March 31, 1996. The Company has adequate resources to meet these
obligations.
Inflation and changing prices had no material impact on revenues or the results
of operations for the nine month period ended September 30, 1996. There are no
known trends or commitments which may have an impact on the Company's liquidity.
Net installment contracts receivable increased by approximately $16.0 million in
the nine month period ended September 30, 1996 as a result of an increase in the
number of contracts purchased from dealers due to the Company's expanded
marketing program.
Short term investments decreased by approximately $16.0 million as a direct
result of funding the Company's growth in installment contract receivable and
the retirement of $1.6 million in subordinated notes.
Results of Operations
On April 1, 1995, the Company consummated the sale of certain assets, net of
certain liabilities, constituting the operating assets of the Orion Network,
Compass Network, Checkmate Computer Systems, and Insurance Parts Locator
businesses. On July 20, 1995, the Company consummated the sale of the operating
assets of its insurance inspection services business. The Results of Operations
of these businesses have been classified as discontinued operations.
On December 6, 1995, the Company, through a wholly owned subsidiary, acquired
the operating assets of FALK Finance Company (FFC), a Norfolk, Virginia based
specialized financial services company. As a result of this acquisition, the
Company's primary business is to purchase non-prime automobile retail
installment contracts from new and used automobile dealers. The Company services
these dealers by providing specialized financing programs for buyers who
typically have impaired credit histories and are unable to access traditional
sources of available consumer credit.
On February 28, 1996, the Company made an election to change its fiscal year-end
from May 31 to December 31. The Company believes that this change provides
shareholders with information on a basis more comparable to other public
entities in the specialized automobile finance industry. The Company will
continue to present the most comparable prior year fiscal period, the three
months ended August 31, 1995 for this Form 10-Q Report.
The Company's continuing operations consist of its non-prime automobile finance
business and its long distance telephone services business. Except as otherwise
noted, the following discussion of the results of operations is with
10
<PAGE>
respect to the Company's continuing operations. Due to this change in both
operations and fiscal periods, the following discussion and analysis focuses on
the current quarter and nine months ended September 30, 1996.
Three and Nine Months Ended September 30, 1996
Revenues
Revenues for the three and nine month periods ended September 30, 1996 were
derived from the non-prime automobile finance business ($3,057,000 and
$8,135,000, respectively), the long-distance telephone service business
($120,000 and $400,000, respectively) and investment income ($287,000 and
$802,000, respectively).
Net Interest Income on Automobile Installment Contracts Receivable
The Company's principal revenue source is the net interest income, or net
spread, earned on its automobile installment contracts receivable. This net
spread is the differential between interest income received on loans receivable
and the interest expense on related loans payable. The following table
summarizes the pertinent data on the Company's automobile contracts receivable
portfolio for the three and nine month periods ended September 30, 1996:
Nine months ended Three months ended
September 30, 1996 September 30, 1996
------------------ ------------------
Average loans receivable $41,687,000 $49,248,000
----------- -----------
Average loan payable 32,912,000 37,198,000
----------- -----------
Interest income $7,816,000 $2,992,000
Interest expense 2,565,000 970,000
----------- -----------
Net interest expense $5,251,000 $2,022,000
----------- -----------
Yield on loans(1) 24.9% 24.3%
Cost of funds(1) 10.4% 10.4%
----------- -----------
Net interest spread 14.5% 13.9%
----------- -----------
Net interest margin(2) 16.7% 16.4%
----------- -----------
(1) Percentages are presented on an annualized basis.
(2) Net interest margin is net interest income divided by average loans
outstanding.
Costs and Expenses
Interest expense for the three and nine month periods ended September 30, 1996
($1,008,000 and $2,679,000, respectively) was primarily related to the debt
outstanding under the Company's senior credit facility ($30.4 million as of
September 30, 1996) and subordinated notes ($8.6 million as of September 30,
1996).
Operating expenses for the three and nine months ended September 30, 1996
($1,922,000 and $4,680,000, respectively) consisted primarily of the operating
expenses of the non-prime automobile finance business and corporate overhead.
11
<PAGE>
Depreciation and amortization expense for the three and nine months ended
September 30, 1996 ($326,000 and $815,000, respectively) consisted primarily of
the amortization of goodwill and other intangible assets associated with the
acquisition of FFC in December 1995.
The provision for credit losses is the result of the Company recording
additional credit losses based upon the quality and performance of its
automobile receivable portfolio.
The unusual item - provision for credit losses on acquired automobile
receivables is the result of the Company recording additional credit losses of
$2,000,000 of the portfolio acquired from FFC in December 1995.
Income from Operations
The loss from continuing operations for the three and nine month periods ended
September 30, 1996 was $(3,095,000) and $(3,633,000), respectively. Income tax
benefits were $(1,623,000) and $(2,130,000), respectively, or an effective tax
rate of 34% and 37%, respectively, as a result of a portion of the Company's
investment income being derived from instruments exempt from federal taxation.
Installment Contracts Receivable
The following table provides information regarding the Company's allowance for
credit losses as of September 30, 1996:
Allowance for credit losses $ 11,435,000
Percentage of outstanding installment contracts 22.2%
The following table summarizes the Company's delinquent accounts that were more
than 60 days delinquent as of September 30, 1996:
Amount %(1)
------------------------------------
60 to 89 days delinquent $2,946,000 4.3%
90 days or more delinquent 1,798,000 2.6%
Total delinquent loans $4,744,000 6.9%
(1) All percentages are gross loans outstanding and are
presented on an annualized basis.
Management has reviewed its past due loans and repossessed collateral as of
September 30, 1996 and, in management's opinion, the allowance for credit losses
is adequate to absorb losses in the portfolio.
12
<PAGE>
AUTOINFO, INC. AND SUBSIDIARIES
Part II - OTHER INFORMATION
Item 1 - 3: Inapplicable
Item 4: Submission of Matters to a Vote of Security Holders None
Item 5: Inapplicable
Item 6 (a): The following exhibits are filed with this report:
Exhibit 11 - Calculation of Earnings Per Share
Item 6 (b): No reports on Form 8-K were filed by the Registrant during
the quarter for which this report is filed.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
authorized.
AUTOINFO, INC.
(Registrant)
/s/ Scott Zecher
--------------------------------------
Scott Zecher
President & Chief Executive Officer
/s/ William I. Wunderlich
--------------------------------------
William I. Wunderlich
Treasurer, Secretary and Principal
Financial Officer
Date: May 12, 1997
14
Exhibit 11
AUTOINFO, INC. AND SUBSIDIARIES
Calculation of Earnings Per Share
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, August 31, September 30, August 31,
1996 1995 1996 1995
----------------- ---------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Primarily and fully diluted earnings (loss):
Earnings (loss) from operations applicable to
common stock
From continuing operations $(3,632,822) $(1,807,380) $(3,095,320) $ 131,081
From discontinued operations -- 9,709,095 -- 228,935
----------- ----------- ----------- ----------
Net income $(3,632,822) $ 7,901,715 $(3,095,320) $ 360,016
----------- ----------- ----------- ----------
Shares:
Weighted average number of
common shares outstanding 7,918,329 7,492,691 8,000,615 7,757,736
Add shares issuable from assumed
exercise of options and warrants -- 68,786 -- 6,309
----------- ----------- ----------- ----------
Weighted average number of common
shares as adjusted 7,918,329 7,561,477 8,000,615 7,764,045
----------- ----------- ----------- ----------
Primary and fully diluted earnings per
common share:
From continuing operations $ (.46) $ (.24) $ (.39) $ .02
From discontinued operations -- 1.28 -- .03
----------- ----------- ----------- ----------
Net income
$ (.46) $ 1.04 $ (.39) $ .05
----------- ----------- ----------- ----------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 89,513
<SECURITIES> 7,890,053
<RECEIVABLES> 52,444,692
<ALLOWANCES> (11,435,161)
<INVENTORY> 0
<CURRENT-ASSETS> 52,946,179
<PP&E> 1,856,365
<DEPRECIATION> (257,072)
<TOTAL-ASSETS> 69,624,882
<CURRENT-LIABILITIES> 813,217
<BONDS> 41,022,138
0
0
<COMMON> 79,548
<OTHER-SE> 27,709,979
<TOTAL-LIABILITY-AND-EQUITY> 69,624,882
<SALES> 9,337,042
<TOTAL-REVENUES> 9,337,042
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 5,494,563
<LOSS-PROVISION> 6,926,000
<INTEREST-EXPENSE> 2,678,941
<INCOME-PRETAX> (5,762,462)
<INCOME-TAX> (2,129,640)
<INCOME-CONTINUING> (3,632,822)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,632,822)
<EPS-PRIMARY> (0.460)
<EPS-DILUTED> (0.460)
</TABLE>
