UNITED STATES
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): JANUARY 29, 1999
OCWEN FINANCIAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FLORIDA 0-21341 65-0039856
(STATE OR OTHER (COMMISSION (I.R.S. EMPLOYER
JURISDICTION FILE NUMBER) IDENTIFICATION NO.)
OF INCORPORATION)
THE FORUM, SUITE 1000
1675 PALM BEACH LAKES BOULEVARD, WEST PALM BEACH, FLORIDA 33401
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (561) 682-8000
N/A
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
PAGE 1 OF 17
EXHIBIT INDEX ON PAGE 4
<PAGE>
ITEM 5. OTHER EVENTS
The news release of Ocwen Financial Corporation, dated January 29, 1999,
announcing its 1998 results and certain other information, is attached hereto
and filed herewith as Exhibit 99.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
The following exhibit is filed as part of this report:
(99) News release of Ocwen Financial Corporation dated January
29, 1999.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, hereunto duly authorized.
OCWEN FINANCIAL CORPORATION
(Registrant)
By: /s/ MARK S. ZEIDMAN
-----------------------------
Mark S. Zeidman
Senior Vice President and
Chief Financial Officer
Date: February 11, 1999
3
<PAGE>
INDEX TO EXHIBIT
Exhibit No. Description Page
----------- ----------- ----
99 News release of Ocwen Financial Corporation dated 5
January 29, 1999, announcing its 1998 results and
certain other information.
4
================================================================================
Exhibit 99
[GRAPHIC OMITTED] OCWEN FINANCIAL CORPORATION
================================================================================
FOR IMMEDIATE RELEASE FOR FURTHER INFORMATION, CONTACT:
A. RICHARD HURWITZ
VP, CORPORATE COMMUNICATIONS & MARKETING
T: (561) 682-8575
F: (561) 682-8177 OR E-MAIL: [email protected]
------------------
OCWEN FINANCIAL CORPORATION
REPORTS 1998 RESULTS
CONSISTENT WITH PRE-EARNINGS RELEASE
FOURTH QUARTER AND YEAR END HIGHLIGHTS
o 1998 NET INCOME, PRIOR TO IMPAIRMENT CHARGES, INCREASED 22% OVER PRIOR YEAR
o 1998 FOURTH QUARTER NET INCOME, PRIOR TO IMPAIRMENT CHARGES, DECREASED 9.6%
OVER SAME QUARTER PRIOR YEAR
o NET INCOME FROM THIRD PARTY MORTGAGE SERVICING INCREASED 223% IN 1998
o OTX INTRODUCES REALTRANS(SM), ITS REAL ESTATE E-COMMERCE SOLUTION
o LOANS SERVICED FOR OTHERS INCREASED 92% DURING 1998 TO $10.59 BILLION
o APPOINTED SPECIAL SERVICER FOR $9.12 BILLION OF LOANS IN 1998
WEST PALM BEACH, FL - (January 29, 1999) Ocwen Financial Corporation (NYSE: OCN)
today reported net income for its fourth quarter ended December 31, 1998, prior
to impairment charges, of $20.4 million, or $0.34 per diluted share, compared to
$22.9 million, or $0.37 per diluted share, for the fourth quarter of 1997. For
the year ended December 31, 1998, the Company reported net income, prior to
impairment charges, of $95.9 million, or $1.57 per diluted share, compared to
$78.9 million, or $1.39 per diluted share, for the year ended December 31, 1997,
an increase of 22%.
Including impairment charges, the Company reported a net loss of $10.6 million,
or $0.17 per diluted share, for the 1998 fourth quarter, compared to net income
of $22.9 million, or $0.37 per diluted share, for the 1997 fourth quarter. For
the year ended December 31, 1998, the Company reported a net loss of $1.2
million, or $0.02 per diluted share, for 1998 compared to net income of $78.9
million, or $1.39 per diluted share, for the year ended December 31, 1997.
Pre-tax impairment charges for the 1998 fourth quarter totaled $49.5 million, of
which $28.5 million related to the Company's securities available for sale (an
investment portfolio including subordinate and residual mortgage-backed
securities), $8.2 million was for losses on its investment in Ocwen Asset
Investment Corp. (NYSE: OAC) and $10.9 million was for the anticipated
curtailment of its domestic subprime operations. The $28.5 million charge
resulted from each security being written down to the lower of amortized cost or
fair value.
Pre-tax impairment charges for the year ended December 31, 1998 totaled $152.8
million, of which $86.1 million related to the Company's securities portfolio of
AAA-rated agency IOs, $43.6 million related to securities available for sale,
$8.2 million was for losses on its investment in OAC, and $13.0 million was for
the anticipated curtailment of its domestic subprime operations.
5
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
STATEMENT FROM CHAIRMAN AND CEO REGARDING STRATEGIC TRANSITION
William C. Erbey, Chairman and Chief Executive Officer, stated "While 1998 was a
very difficult year for financial services companies, OCN made several notable
achievements, not the least of which was that our discount loan and servicing
businesses made $63.5 million. In addition, we have continued to grow our
annuity-based fee income stream and have made substantial strides in developing
and commercializing our loan servicing and e-commerce technology for the
mortgage and real estate industries. All told, we are quite proud of our
progress during the last quarter with respect to re-focusing our resources on
business lines which leverage the Company's core competencies. For example, the
net income in our third party mortgage-servicing unit increased 223%, and the
loans serviced for others increased 92% to $10.59 billion in unpaid principal
balance in 1998.
"We believe that our servicing expertise and operating platform are exportable
to other countries. In 1998, the Company entered the United Kingdom, and we are
very pleased with the servicing and origination platform that we have developed
there. Other 1998 highlights include:
o At year-end 1998, OCN serviced 153,458 loans for third parties in the United
States totaling $10.59 billion of unpaid principal balance, compared to
70,308 loans totaling $5.51 billion in UPB at December 31, 1997. To
accommodate this growth, the Company is building a national servicing center
in Orlando, Florida, which will have capacity for 1,000 loan servicing
representatives per shift upon planned completion in the summer of 1999.
o OCN continued to expand its servicing activities in 1998 by entering into
special servicing arrangements, wherein the Company acts as a special
servicer for nonperforming loans on behalf of third parties, typically as
part of a securitization. The Company services loans that become greater
than 60 days past due and receives incentive fees to the extent certain loss
mitigation parameters are achieved. Through December 31, 1998, OCN had been
designated as a special servicer for pools of loans totaling approximately
$9.12 billion in original unpaid principal balance.
o Ocwen Technology Xchange, Inc. ("OTX"), our software solutions subsidiary,
introduced REALTrans(SM), a web-based application which facilitates the
electronic ordering of real estate products and services via the Internet.
REALTrans(SM) allows users (banks, brokers, appraisers, agents, title
insurers, attorneys, and other ancillary real estate and mortgage service
providers) to send, receive, and track information easily. It can provide
major cost reductions for all parties to these transactions by saving
valuable time and increasing organizational efficiencies.
o OTX expects to bring to market a significant enhancement to its menu of
mortgage servicing software products in mid-1999. This system of fully
integratable modules allows for the management of the total life cycle of a
loan. The modules include loan servicing, collections, default management,
loss mitigation, REO management, construction loan servicing and related
workflow management. We expect to implement the OTX servicing platform in
the Ocwen UK operation by year-end.
"We believe that our Company, which had $445.2 million in cash and cash
equivalents at 1998 year-end, including $69.0 million at the holding company,
enjoys ample liquidity to fund our strategic transition. In 1999, we will
continue to focus our resources on acquiring discount loans, growing our
fee-for-service business, and developing software technology for the real estate
and mortgage industries."
6
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
NET INCOME SUMMARY BY BUSINESS ACTIVITY
<TABLE>
<CAPTION>
Three Months Twelve Months
-------------------- --------------------
For the periods ended December 31, 1998 1997 1998 1997
------------------------------------------- -------- -------- -------- --------
<S> <C> <C> <C> <C>
Discount loans (1): ........................ (Dollars in thousands)
Single family residential loans .......... $(11,066) $ 12,280 $ 14,394 $ 23,349
Large commercial real estate loans ....... 4,463 3,411 28,103 24,474
Small commercial real estate loans ....... 737 2,948 8,195 5,349
-------- -------- -------- --------
(5,866) 18,639 50,692 53,172
-------- -------- -------- --------
Mortgage loan servicing:
Domestic ................................. 4,704 1,286 8,066 3,972
Foreign (UK) ............................. 2,857 -- 4,771 --
-------- -------- -------- --------
7,561 1,286 12,837 3,972
-------- -------- -------- --------
Investment in low-income housing tax
credits ................................. 627 503 6,149 4,147
Commercial real estate lending ............ 759 6,167 13,588 12,405
OTX ....................................... (3,547) -- (9,623) --
Subprime single family residential lending:
Domestic ................................ (13,267) (781) (20,524) (2,166)
Foreign (UK) ............................ 1,257 -- 7,475 --
-------- -------- -------- --------
(12,010) (781) (13,049) (2,166)
-------- -------- -------- --------
Investment securities ..................... (3,226) (2,203) (59,186) 3,587
Other ..................................... 5,125 (677) (2,608) 3,815
-------- -------- -------- --------
$(10,577) $ 22,934 $ (1,200) $ 78,932
======== ======== ======== ========
</TABLE>
(1) Exclusive of the impairment charges on residential subordinate securities,
net income (loss) from the single family residential loan business activity
would have been $(3,490) and $21,970 for the three and twelve months ended
December 31, 1998, respectively, and net income from the discount loan business
activity in the aggregate would have been $1,710 and $58,268 for the three and
twelve months ended December 31, 1998, respectively.
7
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
THE REMAINDER OF THIS RELEASE CONTAINS SELECTED SUMMARY INFORMATION ON THE
SPECIFIC AREAS OF THE COMPANY'S RESULTS, FINANCIAL CONDITION, AVERAGE BALANCES,
AND RATES, AS WELL AS OCN'S INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
FOURTH QUARTER AND TWELVE MONTHS AT A GLANCE Fourth Quarter Year
- -------------------------------------------------------- ----------------------------- -----------------------------
In thousands of dollars, except per share data 1998 1997 1998 1997
- -------------------------------------------------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues ............................................... $ 39,934 $ 84,689 $ 226,131 $ 263,879
Provision for loan losses .............................. (4,775) (10,479) (18,509) (32,218)
Expenses ............................................... (74,016) (45,197) (239,988) (132,123)
Income tax (expense) benefit ........................... 27,811 (6,398) 30,699 (21,309)
Minority interest ...................................... 469 319 467 703
------------ ------------ ------------ ------------
Net income ............................................. $ (10,577) $ 22,934 $ (1,200) $ 78,932
============ ============ ============ ============
Earnings per share:
Basic................................................ $ (0.17) $ 0.38 $ (0.02) $ 1.40
Diluted ............................................. $ (0.17) $ 0.37 $ (0.02) $ 1.39
Weighted average shares outstanding:
Basic ............................................... 60,797,467 60,541,578 60,736,950 56,185,956
Diluted ............................................. 60,797,467 61,321,725 61,736,950 56,836,484
Annualized Returns:
Average assets ...................................... (1.20)% 2.96% (0.03)% 2.78%
Average equity ...................................... (9.82)% 22.40% (0.28)% 27.22%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
REVENUES
NET INTEREST INCOME
Interest income of $66.2 million for the fourth quarter of 1998 decreased by
$7.5 million or 10%, compared to the fourth quarter of 1997. This decrease was
the result of a 148 basis point decrease in the average yield earned, offset in
part by an $80.3 million increase in the average balance of interest-earning
assets. The decrease in the average yield earned for the fourth quarter of 1998
was primarily due to a decline in yield on the loan portfolio which was the
result of $5.9 million of additional interest income received in connection with
the payoff of four loans secured by hotel and office properties during the
fourth quarter of 1997. Of the $80.3 million net increase in average
interest-earning assets, $324.2 million, $152.2 million, $84.6 million related
to securities available for sale, loans available for sale and federal funds
sold, and repurchase agreements, respectively, offset by a $353.9 million
decrease in the discount loan portfolio and a $122.5 million decrease related to
the loan portfolio. The $152.2 million increase in loans available for sale
relates to loans held by Ocwen UK. The average yield on interest-earning assets
was 10.02% and 11.50% for the fourth quarter of 1998 and 1997, respectively, and
10.82% and 11.50% for the year ended December 31, 1998 and 1997, respectively.
For the year ended December 31, 1998, interest income amounted to $307.7
million, a $35.2 million or a 13% increase over the same period in 1997.
Interest expense of $43.6 million for the fourth quarter of 1998 increased by
$3.3 million or 8% over the comparable period in the prior year as a result of a
$195.1 million increase the average balance of interest-bearing liabilities. Of
this increase, $182.6 million and $33.9 million related to borrowings under
lines of credit and securities sold under agreements to repurchase,
respectively, offset by a $16.5 million decline in deposits. The average rate
paid on interest-bearing liabilities was 6.77% in the fourth quarter of 1998 and
1997, and 6.84% and 6.69% for the year ended December 31, 1998 and 1997,
respectively. For the year ended December 31, 1998, interest expense increased
$28.6 million or 18% over the prior year to $184.9 million, primarily due to a
$29.0 million increase in interest expense on obligations outstanding under
lines of credit as a result of a $396.9 million or 471% increase in the average
balance outstanding.
8
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
As a result of the above, net interest income before provision for loan losses
of $22.6 million for the fourth quarter of 1998 decreased by $10.8 million or
32% from the fourth quarter of 1997, and the net interest margin for the fourth
quarter of 1998 decreased to 3.42% from 5.21% for the fourth quarter of 1997.
Net interest income of $122.8 million for the year ended December 31, 1998
increased $6.6 million or 6% over the prior year, and the net interest margin
declined 59 basis points to 4.32%.
NON-INTEREST INCOME
Non-interest income for the fourth quarter of 1998 was $28.7 million, a decrease
of $15.1 million or 34% from that of the fourth quarter of 1997. The decrease
was primarily due to a $38.6 million decrease in gains on interest earning
assets, offset by an $11.7 million increase in servicing fees and other charges
and a $9.2 million increase in other income. Non-interest income for 1998
decreased by $12.6 million to $111.3 million, primarily due to an $83.8 million
decline in gains on interest-earning assets, offset by a $33.2 million increase
in servicing fees and other charges and a $31.2 million increase in other
income.
Loss on interest-earning assets, net, for the fourth quarter of 1998 amounted to
$2.5 million and was primarily comprised of a $28.5 million impairment charge on
certain subordinate and residual mortgage-backed securities available for sale,
offset by a $16.5 million and $5.0 million gain recognized in connection with
the securitization of $194.7 million of U.K. subprime single family residential
mortgage loans and $262.1 million of U.S. subprime single family residential
loans, respectively. Gain on interest-earning assets, net, for the fourth
quarter of 1997 of $36.1 million was primarily comprised of a $24.4 million gain
recognized in connection with the securitization of single-family discount loans
with an aggregate unpaid principal balance of $203.4 million, a $9.0 million
gain recognized in connection with the securitization of subprime single-family
residential mortgage loans with an aggregate unpaid principal balance of $208.8
million, and a $2.0 million gain recognized in connection with the
securitization of small commercial mortgage loans with an aggregate unpaid
principal balance of $62.7 million. Gain on interest-earning assets, net, for
the year ended December 31, 1998 decreased by $83.8 million primarily as a
result of $129.7 million of losses and charges on securities, including
AAA-rated agency interest-only securities and certain subordinate and residual
mortgage-backed securities, offset by a $37.8 million increase in gains in
connection with securitizations of discount and subprime mortgage loans.
The increase in servicing fees and other charges reflects an increase in loan
servicing and related fees as a result of an increase in loans serviced for
others. The unpaid principal balance of loans serviced for others averaged
$10.02 billion and $4.69 billion during the fourth quarter of 1998 and 1997,
respectively, and $8.06 billion and $3.11 billion during the year ended December
31, 1998 and 1997, respectively. At December 31, 1998, OCN serviced 153,458
loans for third parties totaling $10.59 billion versus 142,844 loans totaling
$9.96 billion at September 30, 1998, and 70,308 loans totaling $5.51 billion at
December 31, 1997.
Other income of $9.8 million for the fourth quarter of 1998 included $2.4
million of gains on sales of investments in real estate, $4.3 million of
brokerage commissions earned in connection with Ocwen UK loan originations and
$1.8 million of management fees earned from OAC. Other income of $39.7 million
for 1998 included $10.4 million of gains on sales of investments in real estate,
$10.0 million of brokerage commissions earned in connection with Ocwen UK loan
originations, $7.4 million of gains recognized in connection with the sale of
investments in low-income housing tax credit projects, and $5.9 million of
management fees earned from OAC. Other income of $8.5 million for 1997 was
primarily comprised of $6.1 million of gains recognized in connection with the
sale of investments in low-income housing tax credit projects and $1.8 million
of management fees earned from OAC.
EQUITY IN (LOSSES) EARNINGS OF INVESTMENTS IN UNCONSOLIDATED ENTITIES
During the three months ended December 31, 1998, OCN recorded $(8.7) million of
losses resulting from its equity investment in OAC and $(2.9) million of losses
resulting from its equity investment in Norland Capital Group plc, doing
business as Kensington Mortgage Company ("Kensington").
9
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
On December 12, 1997, BCBF LLC, a joint venture between the Company and Black
Rock Finance LP, distributed all of its remaining assets to its partners. As a
result, no equity in earnings was recorded during 1998 related to this entity.
During the fourth quarter of 1997, OCN recorded $7.5 million of income related
to its investment in joint venture, consisting primarily of net interest income.
Income from the joint venture amounted to $23.7 million for 1997 and included
$9.2 million of net gains related to the securitization of single-family
residential loans.
PROVISION FOR LOAN LOSSES
Provision for loan losses decreased by $5.7 million in the fourth quarter of
1998 and $13.7 million during the year ended December 31, 1998. The decline in
the provision for loan losses in 1998, compared to 1997, was primarily due to a
decline in the balance of the discount loan and loan portfolios. At December 31,
1998, OCN had allowances for losses of $21.4 million and $4.9 million on its
discount loan and loan portfolios, respectively, which amounted to 1.7% and 1.8%
of the respective balances. The Company maintained reserves of 1.6% and 1.4% on
its discount loan and loan portfolios, respectively, at December 31, 1997.
EXPENSES
NON-INTEREST EXPENSE
Non-interest expense amounted to $70.6 million for the fourth quarter of 1998,
including $14.6 million and $3.7 million related to Ocwen UK and OTX,
respectively, representing an increase of $28.8 million or 69% over the fourth
quarter of 1997. Compensation and employee benefits increased by $9.3 million as
the average number of employees increased from 1,104 to 1,663. Of the $9.3
million increase, $5.8 million and $3.2 million related to Ocwen UK and OTX,
respectively. Occupancy and equipment expense increased $4.5 million primarily
due to an increase in data processing costs, general office equipment expenses,
and rental expense. The $7.8 million increase in goodwill amortization was due
to the write-off of the remaining unamortized balance of goodwill related to OFS
in anticipation of the Company's curtailment of its domestic subprime
operations. Loan expenses increased by $4.2 million, all of which was attributed
to Ocwen UK. For the year ended December 31, 1998, non-interest expense
increased $99.5 million, or 78%, to $226.4 million primarily due to a $38.0
million increase in compensation and benefits, a $17.2 million increase in
occupancy and equipment, an $18.2 million increase in loan expenses ($15.2
million of which related to Ocwen UK), and an $11.1 million increase in
amortization of goodwill ($10.3 million of which related to OFS). Non-interest
expense for 1998 included $41.3 million and $11.3 million related to Ocwen UK
and OTX.
DISTRIBUTIONS ON COMPANY-OBLIGATED, MANDATORY REDEEMABLE SECURITIES OF
SUBSIDIARY TRUST HOLDING SOLELY JUNIOR SUBORDINATED DEBENTURES
In August 1997, Ocwen Capital Trust I, a wholly-owned subsidiary of OCN, issued
$125.0 million of 10 7/8% Capital Securities. Distributions amounted to $3.4
million and $13.6 million during the three and twelve months ended December 31,
1998, respectively, compared to $3.4 million and $5.2 million for the same
periods in 1997.
INCOME TAXES
Income tax benefit (expense) amounted to $27.8 million and $(6.4) million during
the fourth quarter of 1998 and 1997, respectively, and $30.7 million and $(21.3)
million for the year ended December 31, 1998 and 1997, respectively. OCN's
income tax benefit for 1998 reflects tax credits of $17.7 million, the use of a
$3.0 million tax benefit resulting from the use of prior year net operating loss
carryforwards and the tax benefit resulting from pre-tax losses. OCN invests in
low-income housing tax credit interests, which provided tax credits of $4.1
million and $4.5 million for the fourth quarter of 1998 and 1997, respectively,
and $17.7 million and $14.9 million for 1998 and 1997, respectively. No
valuation allowance was required at December 31, 1998 because it is expected
that losses and tax credits will be utilized to offset future taxable income and
tax expense.
10
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
ASSET ACQUISITIONS
The Company's volume of discount loan acquisitions fell in 1998 due to the
impact of a healthy economy. Mortgage delinquencies were at their lowest levels
in decades, and major lenders had little need to pare their portfolios. Volume
was also reduced by the absence of significant offerings from the U.S.
government.
<TABLE>
<CAPTION>
Three Months Twelve Months
----------------------- -----------------------
For the periods ended December 31, 1998 1997 1998 1997
----------------------------------------- ---------- ---------- ---------- ----------
(Dollars in thousands)
<S> <C> <C> <C> <C>
Discount Loan Acquisitions:
Single family residential ............. $ 190,796 $ 111,885 $ 419,027 $ 290,359
Housing and Urban Development ("HUD") -- -- 194,173 771,608
---------- ---------- ---------- ----------
Total single family ............... 190,796 111,885 613,200 1,061,967
Commercial real estate ................ 79,831 376,564 499,642 714,806
---------- ---------- ---------- ----------
$ 270,627 $ 488,449 $1,112,842 $1,776,773
========== ========== ========== ==========
Subprime Loan Purchases and Originations:
Domestic .............................. 216,459 210,322 1,077,983 594,182
Foreign (UK) .......................... 120,175 -- 675,621 --
---------- ---------- ---------- ----------
$ 336,634 $ 210,322 $1,753,604 $ 594,182
========== ========== ========== ==========
</TABLE>
For the year ended December 31, 1998, the Company purchased discount loans with
a total unpaid principal balance of approximately $1.11 billion, compared to
$1.78 billion in 1997. While the volume of single-family residential loans
(other than HUD) increased 44.3% over the prior year, the Company acquired
approximately $792.6 million less HUD single-family residential loans and
commercial real estate loans than in 1997.
For the year ended December 31, 1998, OCN purchased and originated single family
residential loans to subprime borrowers with a total unpaid principal balance of
approximately $1.75 billion, compared to $594.2 million at December 31, 1997.
Domestic subprime loan originations increased 81.4% in 1998, from $594.2 million
to $1.01 billion. The $675.6 million of UK subprime loan purchases and
originations in 1998 included $421.3 million of loans purchased in connection
with OCN's acquisition of its UK origination and servicing platform in April
1998.
CAPITAL
Stockholders' equity increased $16.7 million or 4% during the twelve months
ended December 31, 1997 from $419.7 million to $436.4 million at December 31,
1998.
11
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
FORWARD-LOOKING STATEMENTS
CERTAIN STATEMENTS CONTAINED HEREIN ARE NOT BASED ON HISTORICAL FACTS AND ARE
"FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES
ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES ACT OF 1934, AS
AMENDED. THESE FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED BY REFERENCE TO A
FUTURE PERIOD(S) OR BY THE USE OF FORWARD-LOOKING TERMINOLOGY SUCH AS
"ANTICIPATE," "BELIEVE," "COMMITMENT," "CONTINUE," "COULD," "ESTIMATE," "MAY,"
"PRESENT," "WILL," FUTURE OR CONDITIONAL VERB TENSES, SIMILAR TERMS, VARIATIONS
ON SUCH TERMS OR NEGATIVES OF SUCH TERMS. ALTHOUGH OCN BELIEVES THE ANTICIPATED
RESULTS OR OTHER EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE
BASED ON REASONABLE ASSUMPTIONS, ACTUAL RESULTS COULD DIFFER MATERIALLY FROM
THOSE INDICATED DUE TO RISKS, UNCERTAINTIES AND CHANGES WITH RESPECT TO A
VARIETY OF FACTORS, INCLUDING, BUT NOT LIMITED TO, INTERNATIONAL, NATIONAL,
REGIONAL OR LOCAL ECONOMIC ENVIRONMENTS, GOVERNMENT FISCAL AND MONETARY
POLICIES, PREVAILING INTEREST OR CURRENCY EXCHANGE RATES, EFFECTIVENESS OF
INTEREST RATE, CURRENCY AND OTHER HEDGING STRATEGIES, LAWS AND REGULATIONS
AFFECTING FINANCIAL INSTITUTIONS, REAL ESTATE INVESTMENT TRUSTS AND REAL ESTATE
(INCLUDING REGULATORY FEES, CAPITAL REQUIREMENTS AND INCOME AND PROPERTY
TAXATION), UNCERTAINTY OF FOREIGN LAWS, COMPETITIVE PRODUCTS, PRICING AND
CONDITIONS (INCLUDING FROM COMPETITORS THAT HAVE SIGNIFICANTLY GREATER RESOURCES
THAN OCN), CREDIT, PREPAYMENT, BASIS, DEFAULT, SUBORDINATION AND ASSET/LIABILITY
RISKS, LOAN SERVICING EFFECTIVENESS, ABILITY TO IDENTIFY ACQUISITIONS AND
INVESTMENT OPPORTUNITIES MEETING OCN'S INVESTMENT STRATEGY, COURSE OF
NEGOTIATIONS AND ABILITY TO REACH AGREEMENT WITH RESPECT TO MATERIAL TERMS OF
ANY PARTICULAR TRANSACTION, SATISFACTORY DUE DILIGENCE RESULTS, SATISFACTION OR
FULFILLMENT OF AGREED UPON TERMS AND CONDITIONS OF CLOSING OR PERFORMANCE,
TIMING OF TRANSACTION CLOSINGS, ACQUISITIONS AND INTEGRATION OF ACQUIRED
BUSINESSES, SOFTWARE INTEGRATION, DEVELOPMENT AND LICENSING, AVAILABILITY OF AND
COSTS ASSOCIATED WITH OBTAINING ADEQUATE AND TIMELY SOURCES OF LIQUIDITY,
DEPENDENCE ON EXISTING SOURCES OF FUNDING, ABILITY TO REPAY OR REFINANCE
INDEBTEDNESS (AT MATURITY OR UPON ACCELERATION), TO MEET COLLATERAL CALLS BY
LENDERS (UPON RE-VALUATION OF THE UNDERLYING ASSETS OR OTHERWISE), TO GENERATE
REVENUES SUFFICIENT TO MEET DEBT SERVICE PAYMENTS AND OTHER OPERATING EXPENSES
AND TO SECURITIZE WHOLE LOANS, AVAILABILITY OF DISCOUNT LOANS FOR PURCHASE, SIZE
OF, NATURE OF AND YIELDS AVAILABLE WITH RESPECT TO THE SECONDARY MARKET FOR
MORTGAGE LOANS, FINANCIAL, SECURITIES AND SECURITIZATION MARKETS IN GENERAL,
ALLOWANCES FOR LOAN LOSSES, GEOGRAPHIC CONCENTRATIONS OF ASSETS (TEMPORARY OR
OTHERWISE), TIMELY LEASING OF UNOCCUPIED SQUARE FOOTAGE (GENERALLY AND UPON
LEASE EXPIRATION), CHANGES IN REAL ESTATE CONDITIONS (INCLUDING LIQUIDITY,
VALUATION, REVENUES, RENTAL RATES, OCCUPANCY LEVELS AND COMPETING PROPERTIES),
ADEQUACY OF INSURANCE COVERAGE IN THE EVENT OF LOSS, KNOWN OR UNKNOWN
ENVIRONMENTAL CONDITIONS, YEAR 2000 COMPLIANCE, OTHER FACTORS GENERALLY
UNDERSTOOD TO AFFECT THE REAL ESTATE ACQUISITION, MORTGAGE AND LEASING MARKETS,
SECURITIES INVESTMENTS, AND OTHER RISKS DETAILED FROM TIME TO TIME IN OCN'S
REPORTS AND FILINGS WITH THE SEC, INCLUDING ITS REGISTRATION STATEMENTS ON FORMS
S-1 AND S-3 AND PERIODIC REPORTS ON FORMS 10-Q, 8-K AND 10-K
Ocwen Financial Corporation is a $3.3 billion financial institution
headquartered in West Palm Beach, Florida. The Company's primary businesses are
the acquisition, servicing, and resolution of subperforming and nonperforming
residential and commercial mortgage loans. Additional information about Ocwen
Financial Corporation is available at www.ocwen.com - OCN.
12
<PAGE>
<TABLE>
<CAPTION>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
At or for the Three At or for the Twelve
OCWEN FINANCIAL CORPORATION Months ended December 31, Months ended December 31,
FINANCIAL SUMMARY ----------------------------------------- ----------------------------------------
(DOLLARS IN THOUSANDS, EXCEPT SHARE DATA) 1998 1997 Change % 1998 1997 Change %
- ------------------------------------------- ----------- ----------- ----------- ----------- ----------- -----------
OPERATIONS DATA:
<S> <C> <C> <C> <C> <C> <C>
Interest income ........................... $ 66,236 $ 73,736 (10) $ 307,694 $ 272,531 13
Interest expense .......................... 43,601 40,313 8 184,893 156,289 18
----------- ----------- ----------- -----------
Net interest income ....................... 22,635 33,423 (32) 122,801 116,242 6
Provision for loan losses ................. 4,775 10,479 (54) 18,509 32,218 (43)
----------- ----------- ----------- -----------
Net interest income after provision for
loan losses .......................... 17,860 22,944 (22) 104,292 84,024 24
----------- ----------- ----------- -----------
Servicing fees and other charges .......... 20,136 8,479 137 59,180 25,962 128
(Loss) gain on interest-earning assets, net (2,502) 36,070 (107) (1,594) 82,212 (102)
Other non-interest income ................. 11,108 (751) 1,579 53,729 15,775 241
----------- ----------- ----------- -----------
Total non-interest income .............. 28,742 43,798 (34) 111,315 123,949 (10)
----------- ----------- ----------- -----------
Compensation and employee benefits ........ 31,835 22,504 41 115,556 77,573 49
Other non-interest expense ................ 38,782 19,294 101 110,838 49,301 125
----------- ----------- ----------- -----------
Total non-interest expense ............. 70,617 41,798 69 226,394 126,874 78
Capital Trust Securities .................. 3,399 3,399 -- 13,594 5,249 159
Equity in (losses) earnings of investments
in unconsolidated entities ............. (11,443) 7,468 (253) (7,985) 23,688 (134)
----------- ----------- ----------- -----------
(Loss) income before income taxes ...... (38,857) 29,013 (234) (32,366) 99,538 (133)
----------- ----------- ----------- -----------
Income tax benefit (expense) .............. 27,811 (6,398) (535) 30,699 (21,309) (244)
Minority interest ......................... 469 319 47 467 703 (34)
----------- ----------- ----------- -----------
Net income ............................. $ (10,577) $ 22,934 (146) $ (1,200) $ 78,932 (102)
=========== =========== =========== ===========
EARNINGS PER SHARE:
Basic .................................. $ (0.17) $ 0.38 (145) $ (0.02) $ 1.40 (101)
Diluted ................................ $ (0.17) $ 0.37 (146) $ (0.02) $ 1.39 (101)
KEY RATIOS:
Net interest spread ....................... 3.25% 4.73% (31) 3.98% 4.81% (17)
Net interest margin ....................... 3.42% 5.21% (34) 4.32% 4.91% (12)
Annualized Return on Average:
Assets (1) (2) ......................... (1.20)% 2.96% (141) (0.03)% 2.78% (101)
Equity (2) ............................. (9.82)% 22.40% (144) (0.28)% 27.22% (101)
Efficiency Ratio (3) ...................... 100.12% 49.35% 103 176.83% 48.06% 268
AVERAGE BALANCES:
Securities available for sale ............. $ 642,601 $ 318,368 102 $ 590,367 $ 299,558 97
Loans available for sale .................. 409,978 257,730 59 520,859 171,837 203
Loan portfolio ............................ 244,004 366,472 (33) 266,519 410,863 (35)
Discount loan portfolio ................... 1,098,271 1,452,204 (24) 1,285,383 1,283,020 --
Total interest-earning assets ............. 2,644,240 2,563,977 3 2,844,691 2,369,149 20
Total assets .............................. 3,521,461 3,094,784 14 3,586,985 2,835,514 27
Deposits .................................. 1,908,166 1,924,708 (1) 1,886,563 1,998,191 (6)
Total interest-bearing liabilities ........ 2,577,578 2,382,522 8 2,702,814 2,336,895 16
Total liabilities ......................... 3,090,550 2,685,290 15 3,159,473 2,545,484 24
Total stockholders' equity ................ 430,911 409,494 5 427,512 290,030 47
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes OCN's pro rata share of average assets held by the joint venture
for the three and twelve months ended December 31, 1997.
(2) Exclusive of the impairment charges the annualized return on average assets
would have been 2.29% and 3.02% for the three and twelve months ended
December 31, 1998, respectively, and the annualized return on average equity
would have been 18.70% and 25.32% for the three and twelve months ended
December 31, 1998, respectively.
(3) Efficiency ratio represents non-interest expense divided by the sum of net
interest income before provision for loan losses, and including equity in
(losses) earnings of investments in unconsolidated entities. Exclusive of
the impairment charges the efficiency ratio would have been 75.43% and
58.09% for the three and twelve months ended December 31, 1998,
respectively.
13
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
<TABLE>
<CAPTION>
OCWEN FINANCIAL CORPORATION
AVERAGE BALANCE/RATE ANALYSIS
Three months ended December 31,
------------------------------------------------------------------------
1998 1997
---------------------------------- ----------------------------------
Average Annualized Average Annualized
Balance Interest Yield/Rate Balance Interest Yield/Rate
------- -------- ---------- ------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
AVERAGE ASSETS:
Federal funds sold and repurchase
agreements......................... $ 206,500 $ 2,986 5.78% $ 121,190 $ 1,663 5.49%
Securities available for sale........ 642,601 15,051 9.37 318,368 5,775 7.26
Loans available for sale............. 409,978 10,606 10.35 257,730 7,277 11.29
Investment securities and other...... 42,886 (823) (7.68) 48,013 1,302 10.85
Loan portfolio....................... 244,004 6,921 11.35 366,472 16,910 18.46
Discount loan portfolio.............. 1,098,271 31,495 11.47 1,452,204 40,809 11.24
---------- --------- ---------- ---------
Total interest-earning assets,
interest income.................... 2,644,240 66,236 10.02 2,563,977 73,736 11.50
---------- --------- ---------- ---------
Non-interest earning cash............ 26,209 23,153
Allowance for loan losses............ (25,721) (24,672)
Investments in low-income housing
tax credit interests............... 137,297 94,241
Investment in unconsolidated entities 84,942 19,790
Real estate owned, net............... 210,851 170,132
Investment in real estate............ 8,125 61,584
Other assets......................... 435,518 186,579
---------- ----------
Total assets......................... $3,521,461 $3,094,784
========== ==========
AVERAGE LIABILITIES AND
STOCKHOLDERS' EQUITY:
Interest-bearing demand deposits..... $ 49,032 $ 269 2.19% $ 25,734 $ 215 3.34%
Savings deposits..................... 1,524 9 2.36 1,915 11 2.30
Certificates of deposit.............. 1,857,610 28,638 6.17 1,897,059 29,523 6.23
---------- --------- ---------- ---------
Total interest-bearing deposits...... 1,908,166 28,916 6.06 1,924,708 29,749 6.18
Notes, debentures and other.......... 227,642 6,844 12.03 227,003 6,748 11.89
Obligations outstanding under lines
of credit.......................... 381,021 6,197 6.51 198,414 3,267 6.59
Securities sold under agreements to
repurchase......................... 60,749 1,644 10.82 26,854 467 6.96
Federal Home Loan Bank advances...... -- -- -- 5,543 82 5.92
---------- --------- ---------- ---------
Total interest-bearing liabilities,
interest expense................... 2,577,578 43,601 6.77 2,382,522 40,313 6.77
--------- ---------
Non-interest bearing deposits........ 34,295 23,345
Escrow deposits...................... 201,073 90,587
Capital Trust Securities............. 125,000 125,000
Other liabilities.................... 152,604 63,836
---------- ----------
Total liabilities.................... 3,090,550 2,685,290
Stockholders' equity................. 430,911 409,494
---------- ----------
Total liabilities and stockholders'
equity............................. $3,521,461 $3,094,784
========== ==========
Net interest income before provision
for loan losses.................... $ 22,635 $ 33,423
========= =========
Net interest rate spread.......... 3.25% 4.73%
Net interest margin................. 3.42% 5.21%
Ratio of interest-earning assets to
interest-bearing liabilities....... 103% 108%
</TABLE>
14
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
<TABLE>
<CAPTION>
Twelve months ended December 31,
---------------------------------------------------------------------------
1998 1997
------------------------------------ ----------------------------------
Average Annualized Average Annualized
Balance Interest Yield/Rate Balance Interest Yield/Rate
------- -------- ---------- ------- -------- ----------
AVERAGE ASSETS: (Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Federal funds sold and repurchase
agreements.............................. $ 149,441 $ 7,930 5.31% $ 163,671 $ 8,975 5.47%
Securities available for trading........... -- -- -- 3,295 248 7.53
Securities available for sale.............. 590,367 40,705 6.90 299,558 29,851 9.53
Loans available for sale................... 520,859 56,791 10.90 171,837 18,368 10.69
Investment securities and other............ 32,122 2,812 8.75 36,905 2,739 11.00
Loan portfolio............................. 266,519 38,609 14.49 410,863 54,701 13.31
Discount loan portfolio.................... 1,285,383 160,847 12.51 1,283,020 157,649 12.29
---------- -------- ---------- --------
Total interest-earning assets, interest
income.................................. 2,844,691 307,694 10.82 2,369,149 272,531 11.50
-------- --------
Non-interest earning cash.................. 23,739 14,843
Allowance for loan losses.................. (25,655) (22,001)
Investments in low-income housing tax
credit interests........................ 130,391 96,096
Investment in unconsolidated entities...... 82,779 34,777
Real estate owned, net..................... 178,223 131,007
Investment in real estate.................. 36,922 44,722
Other assets............................... 315,895 166,921
---------- ----------
Total assets............................. $3,586,985 $2,835,514
========== ==========
AVERAGE LIABILITIES AND STOCKHOLDERS' EQUITY:
Interest-bearing demand deposits........... $ 39,934 $ 1,434 3.59% $ 31,719 $ 1,220 3.85%
Savings deposits........................... 1,652 38 2.30 2,121 49 2.31
Certificates of deposit.................... 1,844,977 115,112 6.24 1,964,351 120,801 6.15
---------- -------- ---------- --------
Total interest-bearing deposits.......... 1,886,563 116,584 6.18 1,998,191 122,070 6.11
Notes, debentures and other................ 227,858 27,088 11.89 228,233 27,114 11.88
Obligations outstanding under lines of
credit.................................. 481,212 34,587 7.19 84,272 5,578 6.62
Securities sold under agreements to
repurchase.............................. 104,980 6,514 6.20 16,717 1,000 5.98
Federal Home Loan Bank advances............ 2,201 120 5.45 9,482 527 5.46
---------- -------- ---------- --------
Total interest-bearing liabilities,
interest expense........................ 2,702,814 184,893 6.84 2,336,895 156,289 6.69
-------- --------
Non-interest bearing deposits.............. 19,483 23,224
Escrow deposits............................ 165,111 78,986
Capital Trust Securities................... 125,000 48,387
Other liabilities.......................... 147,065 57,992
---------- ----------
Total liabilities........................ 3,159,473 2,545,484
Stockholders' equity....................... 427,512 290,030
---------- ----------
Total liabilities and stockholders'
equity.................................. $3,586,985 $2,835,514
========== ==========
Net interest income before provision for
loan losses............................. $122,801 $116,242
======== ========
Net interest rate spread................... 3.98% 4.81%
Net interest margin........................ 4.32% 4.91%
Ratio of interest-earning assets to
interest-bearing liabilities............ 105% 101%
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
OCWEN FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except share data) December 31, December 31,
1998 1997
----------- -----------
<S> <C> <C>
Assets:
Cash and amounts due from depository institutions ............................... $ 120,805 $ 12,243
Interest earning deposits ....................................................... 49,374 140,001
Federal funds sold and repurchase agreements .................................... 275,000 --
Securities available for sale, at fair value .................................... 593,347 476,796
Loans available for sale, at lower of cost or market ............................ 177,847 177,041
Investment securities, net ...................................................... 10,825 13,295
Loan portfolio, net ............................................................. 230,312 266,299
Discount loan portfolio, net .................................................... 1,026,511 1,434,176
Investments in low-income housing tax credit interests .......................... 144,164 128,614
Investment in unconsolidated entities ........................................... 86,893 1,056
Real estate owned, net .......................................................... 201,551 167,265
Investment in real estate ....................................................... 36,860 76,340
Premises and equipment, net ..................................................... 33,823 21,542
Income taxes receivable ......................................................... 40,328 --
Deferred tax asset .............................................................. 60,980 45,148
Excess of purchase price over net assets acquired ............................... 12,706 15,560
Principal, interest and dividends receivable .................................... 18,993 17,284
Escrow advances on loans ........................................................ 88,277 47,888
Other assets .................................................................... 99,483 28,617
----------- -----------
$ 3,308,079 $ 3,069,165
=========== ===========
Liabilities and Stockholders' Equity:
Liabilities:
Deposits ..................................................................... $ 2,175,016 $ 1,982,822
Securities sold under agreements to repurchase ............................... 72,051 108,250
Obligations outstanding under lines of credit ................................ 179,285 118,304
Notes, debentures and other interest bearing obligations ..................... 225,000 226,975
Accrued interest payable ..................................................... 33,706 32,238
Income taxes payable ......................................................... -- 3,132
Accrued expenses, payables and other liabilities ............................. 61,053 51,709
----------- -----------
Total liabilities .......................................................... 2,746,111 2,523,430
----------- -----------
Company-obligated, mandatory redeemable securities of subsidiary trust holding
solely junior subordinated debentures of the Company ...................... 125,000 125,000
Minority interest ............................................................... 592 1,043
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $.01 par value; 20,000,000 shares authorized; 0 shares issued
and outstanding ............................................................ -- --
Common stock, $.01 par value; 200,000,000 shares authorized; 60,800,357 and
60,565,835 shares issued and outstanding at December 31, 1998 and
1997, respectively ......................................................... 608 606
Additional paid-in capital ................................................... 166,234 164,751
Retained earnings ............................................................ 257,170 259,349
Net unrealized gain (loss) on securities available for sale, net of taxes .... 14,057 (5,014)
Net unrealized foreign currency translation loss, net of taxes ............... (1,693) --
----------- -----------
Total stockholders' equity ................................................. 436,376 419,692
----------- -----------
$ 3,308,079 $ 3,069,165
=========== ===========
</TABLE>
16
<PAGE>
Ocwen Financial Corporation Fourth Quarter Results
January 29, 1999
<TABLE>
<CAPTION>
OCWEN FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
Three Months Twelve Months
---------------------------- ----------------------------
For the periods ended December 31, 1998 1997 1998 1997
- ---------------------------------------------------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Interest Income:
Federal funds sold and repurchase agreements ........... $ 2,986 $ 1,663 $ 7,930 $ 8,975
Securities available for sale .......................... 15,051 5,775 40,705 29,851
Securities held for trading ............................ -- -- -- 248
Loans available for sale ............................... 10,606 7,277 56,791 18,368
Loans .................................................. 6,921 16,910 38,609 54,701
Discount loans ......................................... 31,495 40,809 160,847 157,649
Investment securities and other ........................ (823) 1,302 2,812 2,739
------------ ------------ ------------ ------------
66,236 73,736 307,694 272,531
------------ ------------ ------------ ------------
Interest Expense:
Deposits ............................................... 28,916 29,749 116,584 122,070
Securities sold under agreements to repurchase ......... 1,644 467 6,514 1,000
Advances from the Federal Home Loan Bank ............... -- 82 120 527
Obligations outstanding under lines of credit .......... 6,197 3,267 34,587 5,578
Notes, debentures and other interest bearing obligations 6,844 6,748 27,088 27,114
------------ ------------ ------------ ------------
43,601 40,313 184,893 156,289
------------ ------------ ------------ ------------
Net interest income before provision for loan losses ... 22,635 33,423 122,801 116,242
Provision for loan losses ................................ 4,775 10,479 18,509 32,218
------------ ------------ ------------ ------------
Net interest income after provision for loan losses .... 17,860 22,944 104,292 84,024
------------ ------------ ------------ ------------
Non-interest Income:
Servicing fees and other charges ....................... 20,136 8,479 59,180 25,962
(Loss) gain on interest-earning assets, net ............ (2,502) 36,070 (1,594) 82,212
Gain (loss) on real estate owned, net .................. 1,269 (1,351) 14,033 7,277
Other income ........................................... 9,839 600 39,696 8,498
------------ ------------ ------------ ------------
28,742 43,798 111,315 123,949
------------ ------------ ------------ ------------
Non-interest Expense:
Compensation and employee benefits ..................... 31,835 22,504 115,556 77,573
Occupancy and equipment ................................ 10,384 5,839 34,878 17,657
Net operating loss on investments in real estate and
certain low-income housing tax credit interests ...... 1,765 2,973 6,753 4,792
Amortization of excess of purchase price over net assets
acquired ............................................. 8,010 247 11,614 557
Loan expenses .......................................... 6,474 2,299 25,193 7,014
Other operating expenses ............................... 12,149 7,936 32,400 19,281
------------ ------------ ------------ ------------
70,617 41,798 226,394 126,874
------------ ------------ ------------ ------------
Distributions on Company-obligated, mandatory redeemable
securities of subsidiary trust holding solely junior
subordinated debentures ................................ 3,399 3,399 13,594 5,249
Equity in (losses) earnings of investments in
unconsolidated entities ................................ (11,443) 7,468 (7,985) 23,688
------------ ------------ ------------ ------------
(Loss) income before income taxes ...................... (38,857) 29,013 (32,366) 99,538
Income tax benefit (expense) ............................. 27,811 (6,398) 30,699 (21,309)
Minority interest in net loss of consolidated subsidiary . 469 319 467 703
------------ ------------ ------------ ------------
Net (loss) income ...................................... $ (10,577) $ 22,934 $ (1,200) $ 78,932
============ ============ ============ ============
Income Per Share:
Basic .................................................. $ (0.17) $ 0.38 $ (0.02) $ 1.40
============ ============ ============ ============
Diluted ................................................ $ (0.17) $ 0.37 $ (0.02) $ 1.39
============ ============ ============ ============
Weighted Average Common Shares Outstanding:
Basic .................................................. 60,797,467 60,541,578 60,736,950 56,185,956
============ ============ ============ ============
Diluted ................................................ 60,797,467 61,321,725 60,736,950 56,836,484
============ ============ ============ ============
</TABLE>
17
