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EXHIBIT 99
[LOGO] Heller Financial Heller Financial, Inc.
500 West Monroe Street
Chicago, Illinois 60661
312/441-7000
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For Further Information Contact
Linda Anderson/Investor Relations News Release
312/441-7034
Joe St. Henry/Media Relations
248/680-4386
Rich Ringer or Stephanie Kerch
HLB Communications, Inc.
312/649-0371
Heller Financial Reports Eighth Consecutive Year of Record Earnings
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Full Year Net Income up 23% to $290 Million
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Diluted EPS $2.69, Up 21%
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Chicago--(January 18, 2001)--Heller Financial, Inc. (NYSE: HF) today
reported record net income of $290 million for 2000. This represents an increase
of 23% over 1999 results, adjusting for the Company's one-time gain of $48
million on the sale of the assets of its Commercial Services unit in the fourth
quarter of 1999. For the fourth quarter of 2000, net income was $71 million, an
increase of 15% over the adjusted prior period results. Net income applicable to
common stock was $261 million for the year and $64 million for the quarter,
increases over the adjusted prior year periods of 25% and 16%, respectively.
Diluted earnings per share was $2.69 for the year and $0.66 for the quarter, 21%
and 18% increases, respectively, over adjusted 1999 results.
"We are proud to announce our eighth consecutive year of record
earnings," said Chairman and Chief Executive Officer Richard J. Almeida. "Our
business model and disciplined execution continue to prove themselves and
position us for continued solid growth."
Highlights included:
Operating revenues totaled over $1 billion for the full year, up 9%
over 1999. Excluding factoring commissions, which were down due to the 1999 sale
of the domestic factoring business, operating revenues were up 16% for the year
and down 1% for the quarter. Heller's operating margin was 6.1% for the full
year and 5.7% for the quarter.
Net interest income, driven by growth in the Company's portfolio of
lending assets, increased 23% for the year and 9% for the fourth quarter. Net
interest margin was 3.7% for the year and for the fourth quarter.
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Fees and other income, which includes recurring fee income and net
investment gains, increased 4% for the year. Fourth quarter fees and other
income was 22% lower than the prior year due primarily to lower residual and net
investment gains.
Total lending assets and investments were $18.7 billion, up 11% for the
year. During the third and fourth quarters, the Company sold assets of $300
million and $400 million, respectively, into an asset-backed commercial paper
financing vehicle as a more cost-effective funding source. Excluding these
sales, lending assets and investments grew 15% for the year and 5% in the fourth
quarter over the third quarter. New business volume, totaling $7.8 billion for
the year and $2.0 billion for the quarter, was strongest in Heller Corporate
Finance, Heller Real Estate Finance, Heller Leasing Services and Heller
Healthcare Finance.
Credit quality in Heller's portfolio remained in line with targets.
Heller's nonearning assets were 1.9% of total lending assets, below the
Company's target range of 2% to 4%. The Company's loan loss reserve at the end
of the year was 2.1% of receivables. Consistent with Heller's target levels, net
writedowns totaled $115 million, or 0.7% of average lending assets for the year,
and $37 million, or 0.9% for the quarter.
Operating expenses totaled $459 million for the full year and $110
million for the fourth quarter, an increase of only 1% over full year 1999 and a
decrease of 16% for the quarter. Heller's efficiency ratio was 44% for the year
and for the fourth quarter, in line with the Company's 2000 goal, and down from
48% for 1999 and 49% for the fourth quarter of 1999.
According to Mr. Almeida, "The year 2000 was an excellent one across
Heller. As we enter 2001, Heller has never been in such a strong position from a
market or financial perspective. We are confident that our franchise positions
will allow us to capitalize on opportunities that arise from continued
competitive fragmentation and the turn in the economic and credit cycles. We
have a seasoned management team, unparalleled in the industry, which has been
through prior recessions. Over the last decade, we have constructed our
portfolio to weather uncertain economic environments. While we expect the 2001
economy will be less steady than in recent years, we remain confident in our
ability to deliver."
The Board of Directors of the Company has determined that the Annual
Meeting of the Shareholders of the Company will be held on May 3, 2001. The
record date for purposes of voting at the meeting will be March 9, 2001.
Heller Financial, Inc., is a worldwide commercial finance company
providing a broad range of sophisticated, collateralized financing solutions.
With $20 billion in total assets, Heller offers equipment financing and leasing,
sales finance programs, collateral- and cash flow-based financing, financing for
healthcare companies and financing for commercial real estate. The Company also
offers trade finance, factoring, asset-based lending, leasing and vendor finance
products and programs to clients in Europe, Asia, and Latin America. Heller's
common stock is listed as "HF" on the New York and Chicago Stock Exchanges.
Heller can be found on the World Wide Web at http://www.hellerfinancial.com.
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The statements made by the Company in this news release may include
certain forward-looking statements that reflect the Company's current
expectations regarding its future growth, results and performance. These
forward-looking statements are subject to a variety of risks and uncertainties,
which could cause the Company's future growth, results and performance to differ
materially from those expressed in, or implied by, these statements. Information
concerning these risks and uncertainties is contained in the quarterly and
annual reports that the Company files with the Securities and Exchange
Commission.
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HELLER FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(in millions)
ASSETS
<TABLE>
<CAPTION>
December 31, December 31,
2000 1999
---- ----
(unaudited) (audited)
<S> <C> <C>
Cash and cash equivalents....................................................... $ 732 $ 516
Receivables ................................................................... 15,966 14,795
Less: Allowance for losses of receivables..................................... 342 316
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Net receivables........................................................ 15,624 14,479
Investments..................................................................... 1,696 1,286
Operating leases................................................................ 812 508
Investments in international joint ventures..................................... 220 219
Other assets ................................................................... 977 965
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Total assets........................................................... $ 20,061 $ 17,973
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LIABILITIES AND STOCKHOLDERS' EQUITY
Senior debt
Commercial paper and short-term borrowings.................................. $ 5,127 $ 5,202
Notes and debentures........................................................ 10,525 8,630
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Total senior debt...................................................... 15,652 13,832
Credit balances of factoring clients............................................ 982 993
Other payables and accruals..................................................... 840 790
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Total liabilities...................................................... 17,474 15,615
Minority interest............................................................... 12 11
Stockholders' equity
Preferred stock............................................................. 400 400
Common stockholders' equity ................................................ 2,175 1,947
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Total stockholders' equity............................................. 2,575 2,347
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Total liabilities and stockholders' equity............................. $ 20,061 $ 17,973
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</TABLE>
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HELLER FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(in millions, except per share information)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Twelve Months Ended
December 31, December 31,
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2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Interest Income............................................... $ 434 $ 352 $ 1,628 $ 1,197
Interest Expense.............................................. 272 204 999 685
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Net interest income......................................... 162 148 629 512
Fees and other income......................................... 60 77 298 286
Factoring commissions......................................... 20 30 73 119
Income of international joint ventures........................ 10 10 38 35
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Operating revenues.......................................... 252 265 1,038 952
Operating expenses............................................ 110 131 459 456
Provision for losses.......................................... 40 41 148 136
Gain on Sale of Commercial Services assets.................... - 79 - 79
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Income before income taxes and minority interest............ 102 172 431 439
Income tax provision.......................................... 31 62 139 154
Minority interest............................................. - - 2 1
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Net income.................................................. $ 71 $ 110 $ 290 $ 284
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Dividends on preferred stock................................ $ 7 $ 7 $ 29 $ 28
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Net income applicable to common stock..................... $ 64 $ 103 $ 261 $ 256
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Basic net income applicable to common stock per
share (1)............................................... $ 0.66 $ 1.06 $ 2.70 $ 2.75
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Diluted net income applicable to common stock per
share (1)............................................... $ 0.66 $ 1.06 $ 2.69 $ 2.74
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Pro forma diluted net income applicable to common
Stock per share, net of gain of Commercial
Services assets (1) (2) .............................. $ 0.66 $ 0.56 $ 2.69 $ 2.23
======== ======== ======== ========
</TABLE>
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HELLER FINANCIAL, INC. AND SUBSIDIARIES
SELECTED FINANCIAL DATA
(unaudited)
<TABLE>
<CAPTION>
SELECTED DATA AND RATIOS Three Months Ended Twelve Months Ended
(dollars in millions) December 31, December 31,
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2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Profitability:
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Net income applicable to common stock
per share (1):
Basic $0.66 $1.06 $2.70 $2.75
Diluted 0.66 1.06 2.69 2.74
Proforma net income applicable to
common stock per share, net of HCS
gain (1)(2):
Basic and Diluted 0.66 0.56 2.69 2.23
Return on average common
stockholders' equity (3) 11.8% 21.5% 12.7% 14.9%
Return on average common stockholders'
equity, net of HCS gain (2) (3) 11.8% 11.5% 12.7% 12.1%
Return on average common stockholders'
equity, net of HCS gain and net of goodwill
amortization (2) (3) 12.5% 12.3% 13.5% 12.8%
Return on AFE (4) 1.6 2.8 1.7 2.1
Return on AFE, net of HCS gain (2) (4) 1.6 1.6 1.7 1.7
Net interest income as a percentage of
AFE(4) 3.7 3.8 3.7 3.8
Non-interest operating revenues as a
percentage of AFE (4) 2.0 3.0 2.4 3.2
Total operating revenues as a
percentage of AFE (4) 5.7 6.8 6.1 7.0
Operating expenses as a percentage of
AFE (4) 2.5 3.4 2.7 3.3
Operating expenses to operating revenues 43.7% 49.4% 44.2% 47.9%
Operating expenses to AMA (5) 2.3 3.1 2.5 3.0
Gross writedowns $ 40 $ 36 $ 140 $ 116
Gross recoveries $ 3 $ 5 $ 25 $ 18
</TABLE>
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December 31, December 31,
2000 1999
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Credit Quality:
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Ratio of earning loans delinquent 60 days or more
to receivables 1.7% 1.5%
Ratio of total nonearning assets to total lending
assets 1.9% 1.5%
Ratio of net writedowns to average lending
assets 0.74% 0.74%
Ratio of allowance for losses of receivables to
receivables 2.1% 2.1%
Ratio of allowance for losses of receivables to
nonearning receivables 120% 155%
<TABLE>
<CAPTION>
Three Months Ended Twelve Months Ended
December 31, December 31,
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2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Leverage:
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Ratio of debt (net of short-term investments) to
total stockholders' equity 5.9x 5.8x 5.9x 5.8x
Ratio of commercial paper and short-term
borrowings to total debt 33% 38% 33% 38%
Other: (dollars in millions)
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Total lending assets and investments $ 18,716 $ 16,832 $ 18,716 $ 16,832
Total lending assets 15,988 14,819 15,988 14,819
Average lending assets 15,785 14,712 15,456 13,235
Total common stockholders' equity 2,175 1,947 2,175 1,947
Average common stockholders' equity 2,150 1,904 2,057 1,715
Funds employed (4) 17,734 15,839 17,734 15,839
Average funds employed (4) 17,577 15,382 16,978 13,636
Managed assets (5) 19,682 17,202 19,682 17,202
Average managed assets (5) 19,259 16,684 18,376 14,963
</TABLE>
(1) Based on 96,692,722 basic and 97,184,080 diluted weighted average shares of
common stock outstanding for the quarter ended December 31, 2000 and
96,641,375 basic and 96,901,462 diluted weighted average shares of common
stock outstanding for the twelve months ended December 31, 2000. The
diluted weighted average shares as of December 31, 2000, include the effect
of 3.9 million stock options issued to management of the Company.
(2) On December 1, 1999, we sold the assets of our Commercial Services unit.
This transaction resulted in an after tax net gain of $48 million.
(3) Return on average common stockholders' equity is computed as net income
less preferred stock dividends paid, divided by average total common
stockholders' equity.
(4) Funds employed include lending assets and investments, less credit balances
of factoring clients.
(5) Managed assets include funds employed plus receivables previously
securitized or sold and currently managed by the Company.
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LENDING ASSETS AND INVESTMENTS
<TABLE>
<CAPTION>
December 31, September 30, December 31,
BY BUSINESS SEGMENT 2000 2000 1999
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(dollars in millions)
<S> <C> <C> <C>
Domestic Commercial Finance Segment
Corporate Finance $ 5,225 $ 5,573 $ 4,937
Leasing Services 4,434 4,186 3,428
Real Estate Finance 2,766 2,648 2,626
Small Business Finance 1,440 1,400 1,312
Healthcare Finance 1,563 1,396 971
Other 387 550 518
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Total Domestic Commercial Finance Segment $ 15,815 $ 15,753 $ 13,792
International Factoring and Asset Based
Finance Segment 2,901 2,408 3,040
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Total lending assets and investments $ 18,716 $ 18,161 $ 16,832
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</TABLE>
<TABLE>
<CAPTION>
FEES AND OTHER INCOME
(dollars in millions) Three Months Ended Twelve Months Ended
December 31, December 31,
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2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Factoring commissions $ 20 $ 30 $ 73 $ 119
Income of international joint ventures 10 10 38 35
Fees and other income:
Investment and asset sale income* 37 48 204 175
Fee income and other 23 29 94 111
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Total fees and other income $ 60 $ 77 $ 298 $ 286
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Total non-interest income $ 90 $ 117 $ 409 $ 440
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</TABLE>
* Includes gains on securitizations and loans sales, net investment income and
gains, equipment residual gains and participation income.
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