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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C, 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported): October 20, 1994
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GREYHOUND FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 1-7543 94-1278569
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
DIAL CORPORATE CENTER, PHOENIX, ARIZONA 85077
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 602/207-6900
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Item 5. Other Events.
Greyhound Financial Corporation, the principal operating company of
GFC Financial Corporation, announced on October 20, 1994 revenues, net
income and selected financial data and ratios for the third quarter
and nine months ended September 30, 1994 (unaudited).
Item 7. Financial Statements and Exhibits.
(c) Exhibits:
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Exhibits Title
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28 Press Release of Greyhound Financial Corporation
dated October 20, 1994
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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 thereunto duly authorized.
GREYHOUND FINANCIAL CORPORATION
(Registrant)
Dated: October 21, 1994 By /s/ Bruno A. Marszowski
__________________________________
Bruno A. Marszowski, Senior Vice
President, Chief Financial Officer
Principal Financial Officer/
Authorized Officer
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EXHIBIT 28
Robert J. Fitzsimmons Embargo until
602/ 207-5759 8:00 a.m. (E.D.T.)
10/20/94
THESE ARE THE EARNINGS FOR GREYHOUND FINANCIAL CORPORATION
THE PRINCIPAL SUBSIDIARY OF GFC FINANCIAL CORPORATION
WHOSE EARNINGS WERE RELEASED OCTOBER 18, 1994
GREYHOUND FINANCIAL CORPORATION
ANNOUNCES THIRD QUARTER RESULTS
PHOENIX, Arizona, October 20, 1994 -- Greyhound Financial Corporation (the
"Company") today reported strong results for the third quarter ended September
30, 1994 resulting from the addition of an acquisition for a full quarter,
quality portfolio growth and sustained net interest margins.
Net income was $22.1 million for the third quarter of 1994 compared to
$6.8 million for the third quarter of 1993, a 225% increase. The results for
the third quarter of 1994 include income for a full quarter from TriCon Capital
("TriCon") acquired on April 30, 1994. Net income for the third quarter of
1993 included a $4.9 million adjustment for tax rate increases applicable to
deferred income taxes generated by the Company's leveraged lease portfolio.
Excluding this adjustment, net income for the third quarter of 1993 was $11.6
million. The improvement in net income over the third quarter of 1993, before
including the adjustment for deferred income taxes, was 91%.
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Sam Eichenfield, President, Chairman and Chief Executive Officer of
the Company, indicated that he was pleased with the strong performance for the
third quarter of 1994, which is the first full quarter with both Ambassador
Factors ("Ambassador), the factoring and asset based lending company acquired
in February 1994, and TriCon. Eichenfield stated that "along with the
Company's core operations, the addition of Ambassador and TriCon has formed a
solid foundation for the Company's continued growth." He added that new
business volume continues strong, exceeding $1.1 billion for the nine months of
1994 and portfolio quality continues to improve.
Nonearning assets as a percent of funds employed was 3.5% of funds
employed at September 30, 1994, an improvement from 3.7% at the end of the
second quarter of 1994, and measured as a percent of funds employed and
securitizations, declined further to 3.3% at September 30, 1994.
Interest margins earned continue to hold at 6.0% of average earning
assets. This measurement compares to 5.4% for the 1993 period and reflects the
contributions of the acquisitions made in 1994 as well as the continuing strong
returns of the core financial operations. The interest margins more than
offset the higher provisions for possible credit losses and the higher selling,
administrative and other operating expenses ("operating expenses").
The higher loss provisions are attributable to the operations of the
businesses acquired in 1994 and are consistent with the dynamics and expected
loss experience of the businesses.
The higher operating expenses are primarily attributable to the
acquisitions of TriCon and Ambassador in 1994. The running rate of these
expenses (measured as a percent of interest margins earned) was 46.2% (for the
combined entities) in 1994 a slight increase from 46.1% for GFC (which excluded
TriCon and Ambassador) in 1993.
Earnings also benefited from strong portfolio growth. New business
volume was up by 90% to $1.1 billion for the first nine months of 1994, from
$591 million for the 1993 period.
Income taxes were higher in the third quarter of 1994 due to an
increase in income before income taxes and to a higher tax rate in effect
during the third quarter of 1994 (primarily attributable to foreign income
taxes provided).
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Greyhound Financial Corporation, with assets of $5.4 billion, is a
Phoenix-based major domestic commercial finance company providing secured
lending to middle-market companies, making loans from $500,000 to $35 million.
The Company also offers financing programs to manufacturers, distributors,
vendors and franchisors to facilitate the sale of their products to end-users.
####
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GREYHOUND FINANCIAL CORPORATION
AND CONSOLIDATED SUBSIDIARIES
SUMMARY OF CONSOLIDATED INCOME
(UNAUDITED)
(Dollars in Thousands)
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Quarter Ended Nine Months Ended
September 30, September 30,
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1994 1993 1994 1993
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Interest earned from
financing transactions $ 147,649 $ 64,944 $ 343,501 $ 188,406
Interest expense 65,881 30,788 153,391 92,779
Operating lease depreciation 11,345 1,494 21,626 4,338
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Interest margins earned 70,423 32,662 168,484 91,289
Provision for possible
credit losses 2,215 178 10,353 3,706
Gains on securitizations
and sale of assets 1,169 5,672 2,240
Selling, administrative and
other operating expenses 32,591 14,211 77,796 42,044
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Income before income taxes 36,786 18,273 86,007 47,779
Income taxes (1) 14,730 11,523 34,838 22,161
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Net Income $ 22,056 $ 6,750 $ 51,169 $ 25,618
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(1) The results of operations for the quarter and nine months ended September
30, 1993 include a one time adjustment of $4,857,000 representing the
effect of federal tax increases and state income taxes primarily
applicable to deferred income taxes generated by the company's leveraged
lease portfolio.
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GREYHOUND FINANCIAL CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA AND RATIOS (UNAUDITED)
(Dollars in Thousands)
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Nine Months Ended Year Ended or at
or at September 30, December 31,
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1994 (1) 1993 (4) 1993 (4)
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FINANCIAL DATA:
Average funds employed (AFE) and
securitizations (2) $4,289,404 $2,570,355 $ 2,666,208
Ending funds employed (EFE) 5,294,099 2,654,865 2,846,571
Securitizations (2) 307,459
Average earning assets (3) 3,759,107 2,255,330 2,350,019
Nonearning assets 186,016 101,753 102,607
Reserve and accrued liabilities for
possible credit losses (5) 130,727 66,339 64,280
Total debt 4,165,016 1,939,504 2,082,350
Stockholder's equity 765,037 339,780 345,291
New business 1,120,927 591,215 1,007,794
Factoring volume 594,132
Write-offs:
Quarter 7,098 1,665
Year-to-date 19,009 8,337 12,575
RATIOS:
Write-offs (annualized) as a % of AFE
and securitizations 0.6% 0.4% 0.5%
Nonearning assets as a % of EFE and
securitizations (2) 3.3% 3.8% 3.6%
Reserve and accrued liabilities for possible
credit losses as a % of:
Ending funds employed and securitizations
(2) (5) 2.3% 2.5% 2.3%
Nonearning assets 70.3% 65.2% 62.6%
Interest margins earned (annualized) as a %
of average earning assets (3) 6.0% 5.4% 5.2%
Selling, administrative and other operating
expenses as a % of interest margins earned 46.2% 46.1% 47.5%
Total debt to equity 5.4 5.7 6.0
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(1) Includes financial results from the acquisitions of Ambassador (February
14, 1994) and TriCon (April 30, 1994).
(2) Securitizations are assets sold under securitization agreements and
managed by the Company.
(3) Average earning assets are net of average deferred taxes on leveraged
leases and average nonearning assets for the periods presented.
(4) The 1993 periods exclude TriCon and Ambassador.
(5) Loss reserves for securitized transactions total $15,496 and are
classified as accrued liabilities in the balance sheet.
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