<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 1996
--------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______________ to _____________
Commission file number 1-08916
------------
GREEN TREE FINANCIAL CORPORATION
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 41-1807858
- ---------------------------- --------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1100 LANDMARK TOWERS, SAINT PAUL, MINNESOTA 55102-1639
- -----------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (612) 293-3400
--------------
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
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
------- -------
AS OF APRIL 30, 1996, 136,853,806 SHARES OF COMMON STOCK OF GREEN TREE FINANCIAL
CORPORATION WERE OUTSTANDING.
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 1996
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE
<S> <C>
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults Upon Senior Securities 13
Item 4. Submission of Matters to a Vote of
Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
EXHIBIT INDEX 15
Exhibit 11. Computation of Per Share Amounts 16
Exhibit 12. Computation of Ratio of Earnings to
Fixed Charges 17
Exhibit 27. Financial Data Schedule 18
</TABLE>
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1995
-------------- -----------------
(unaudited)
<S> <C> <C>
Assets:
Cash and cash equivalents $ 366,738,000 $ 295,767,000
Cash deposits, restricted 153,835,000 151,811,000
Other investments 20,100,000 19,880,000
Receivables:
Excess servicing rights 918,289,000 764,617,000
Commercial finance (net
of allowance of $1,469,000
and $1,071,000) 295,097,000 141,793,000
Other accounts receivable 58,372,000 52,546,000
Contracts, GNMA certificates
and collateral 733,006,000 884,303,000
Property, furniture and
fixtures 60,369,000 57,104,000
Other assets 8,809,000 8,225,000
-------------- --------------
Total assets $2,614,615,000 $2,376,046,000
============== ==============
Liabilities and Stockholders' Equity:
Notes payable $ 64,388,000 $ 86,162,000
Senior notes 26,650,000 26,650,000
Senior subordinated notes
due 2002 263,347,000 263,234,000
Allowance for losses on
contracts sold with
recourse 219,590,000 163,337,000
Accounts payable and
accrued liabilities 290,781,000 266,131,000
Investor payable 287,880,000 238,448,000
Income taxes, principally
deferred 445,964,000 407,062,000
-------------- --------------
Total liabilities 1,598,600,000 1,451,024,000
Common stock, $.01 par;
authorized 150,000,000
shares, issued 138,724,206
shares (1996) and
137,534,266 shares (1995) 1,387,000 1,375,000
Additional paid-in capital 356,725,000 323,564,000
Retained earnings 711,816,000 653,996,000
-------------- --------------
1,069,928,000 978,935,000
Less treasury stock,
2,051,000 shares at cost (53,913,000) (53,913,000)
-------------- --------------
Total stockholders'
equity 1,016,015,000 925,022,000
-------------- --------------
$2,614,615,000 $2,376,046,000
============== ==============
</TABLE>
See notes to unaudited financial statements.
3
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
--------------------------------
1996 1995
------------ ------------
<S> <C> <C>
Income:
Net gains on contract sales $155,484,000 $107,678,000
Provision for losses on
contract sales (57,997,000) (32,429,000)
Interest 45,182,000 32,689,000
Service 16,325,000 11,795,000
Commissions and other 9,124,000 8,466,000
------------ ------------
168,118,000 128,199,000
Expenses:
Interest 11,364,000 10,438,000
Cost of servicing 12,162,000 8,707,000
General and administrative 37,556,000 27,233,000
------------ ------------
61,082,000 46,378,000
------------ ------------
Earnings before income taxes 107,036,000 81,821,000
Income taxes 40,674,000 31,092,000
------------ ------------
Net earnings $ 66,362,000 $ 50,729,000
============ ============
Earnings per common and
common equivalent share $.48 $.36
==== ====
Weighted average common and
common equivalent shares
outstanding 139,584,826 139,530,474
</TABLE>
See notes to unaudited financial statements.
4
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
----------------------------------
1996 1995
---------------- ----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Servicing fees and net interest
payments collected $ 62,282,000 $ 44,552,000
Net principal payments collected 44,594,000 10,749,000
Interest on contracts and
GNMA certificates 12,129,000 10,541,000
Interest on cash, commercial
finance receivables and
investments 15,658,000 9,613,000
Commissions 8,659,000 7,244,000
Other (509,000) 822,000
---------------- ----------------
142,813,000 83,521,000
---------------- ----------------
Cash paid to employees and suppliers (78,601,000) (47,039,000)
Interest paid on debt (4,735,000) (3,283,000)
Repossession losses net of recoveries (4,427,000) (977,000)
FHA insurance premiums (435,000) (389,000)
Income taxes paid (393,000) (3,922,000)
---------------- ----------------
(88,591,000) (55,610,000)
---------------- ----------------
NET CASH PROVIDED BY OPERATIONS 54,222,000 27,911,000
Purchase of contracts held for sale (1,249,668,000) (868,398,000)
Proceeds from sale of contracts
held for sale 1,404,001,000 802,514,000
Principal collections on contracts
held for sale 38,735,000 19,193,000
Commercial finance loans disbursed (530,717,000) (312,026,000)
Principal collections on
commercial finance loans 394,298,000 161,893,000
Cash deposits provided as credit
enhancements (2,907,000) (3,002,000)
Cash deposits returned 882,000 2,689,000
---------------- ----------------
NET CASH PROVIDED BY (USED FOR)
OPERATING ACTIVITIES 108,846,000 (169,226,000)
---------------- ----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, furniture
and fixtures (7,971,000) (2,442,000)
Net (purchases) sales of
investment securities (220,000) 103,000
---------------- ----------------
NET CASH USED FOR INVESTING ACTIVITIES (8,191,000) (2,339,000)
---------------- ----------------
</TABLE>
5
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(continued)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
----------------------------
1996 1995
------------- ------------
<S> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on credit facilities 790,252,000 541,004,000
Repayments on credit facilities (812,026,000) (541,004,000)
Dividends paid (8,542,000) (6,395,000)
Common stock issued 632,000 478,000
------------- ------------
NET CASH USED FOR FINANCING
ACTIVITIES (29,684,000) (5,917,000)
------------- ------------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 70,971,000 (177,482,000)
CASH AND CASH EQUIVALENTS BEGINNING
OF PERIOD 295,767,000 455,956,000
------------- ------------
CASH AND CASH EQUIVALENTS END OF PERIOD $ 366,738,000 $ 278,474,000
============= =============
RECONCILIATION OF NET EARNINGS
TO NET CASH PROVIDED BY (USED FOR)
OPERATING ACTIVITIES:
Net earnings $ 66,362,000 $ 50,729,000
Provision for income taxes 40,674,000 31,092,000
Depreciation and amortization 5,395,000 2,859,000
Net contract payments collected, less
excess servicing rights recorded (34,219,000) (54,642,000)
Amortization of deferred service income (4,708,000) (3,420,000)
Net amortization of present value
discount (16,610,000) (11,091,000)
Net increase in cash deposits (2,025,000) (313,000)
Purchase of contracts held for sale, net
of sales and principal collections 193,068,000 (46,691,000)
Commercial finance loans disbursed, net
of sales and principal collections (136,419,000) (150,133,000)
Net discount on sale of loans 10,410,000 7,098,000
Increase in interest payable 6,036,000 6,773,000
Other (19,118,000) (1,487,000)
------------- ------------
NET CASH PROVIDED BY (USED FOR)
OPERATING ACTIVITIES $ 108,846,000 $(169,226,000)
============= =============
</TABLE>
See notes to unaudited financial statements.
6
<PAGE>
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED FINANCIAL STATEMENTS
A. Basis of Presentation
The interim financial statements have been prepared by Green Tree Financial
Corporation ("the Company"), without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission applicable to quarterly
reports on Form 10-Q. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations, although management believes that the disclosures are
adequate to make the information presented not misleading. It is suggested
that these financial statements be read in conjunction with the consolidated
financial statements and related notes and schedules included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1995.
Certain reclassifications have been made to the December 31, 1995 financial
statements to conform to the classifications used in the March 31, 1996
financial statements. These reclassifications had no effect on net earnings
or stockholders' equity as previously reported.
In the opinion of management, the information furnished reflects all
adjustments which are of a normal recurring nature and are necessary for a
fair presentation of the Company's financial position as of March 31, 1996,
the results of its operations for the three-month periods ended March 31, 1996
and 1995, and its cash flows for the three-month periods ended March 31, 1996
and 1995.
B. Excess Servicing Rights Receivable
Excess servicing rights receivable consists of:
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1995
-------------- -----------------
(in thousands) (unaudited)
<S> <C> <C>
Gross cash flows receivable
on contracts sold $1,862,135 $1,407,419
Less:
Prepayment reserve (899,473) (674,775)
FHA insurance and other fees (11,054) (11,100)
Deferred service income (126,678) (92,452)
Discount to present value (235,570) (183,132)
Subordinated interest in
NIM Certificates 328,929 318,657
---------- ----------
$ 918,289 $ 764,617
========== ==========
</TABLE>
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Green Tree Financial Corporation is a diversified financial services company
that originates conditional sales contracts for manufactured homes, home
improvements, consumer products and equipment financing, and provides
commercial financing to manufacturers and dealers. The Company also offers
revolving credit, in the form of private-label credit cards, and originates
home equity loans to consumers. The Company's insurance agencies market
physical damage and term mortgage life insurance relating to the customers'
contracts it services.
Results of Operations:
The following table shows the percentage change in income, expenses and
earnings for the three-month period ended March 31, 1996 as compared to the
same period of 1995.
<TABLE>
<CAPTION>
Three-month
period-to-period
increase (decrease)
March 31,
1995 to 1996
-------------------
<S> <C>
Income:
Net gains on contract
sales 44.4%
Provision for losses on
contract sales 78.8
Interest 38.2
Service 38.4
Commissions and other 7.8
Expenses:
Interest 8.9
Cost of servicing 39.7
General and
administrative 37.9
Earnings before income
taxes 30.8
Net earnings 30.8
</TABLE>
Net gains on contract sales increased 44.4% in the first quarter of 1996 over
the same period in 1995 as a result of increased dollar volume of contracts
sold and longer average terms on the manufactured home and home improvement
contracts sold. This increase in net gains on contract sales was partially
offset by decreased interest rate spreads on the manufactured housing
contracts sold and a change in mix of contracts sold in the first quarter of
1996 compared to the same period in 1995. For the quarter ended March 31,
1996, total contract sales increased $605,593,000, or 74.9%.
8
<PAGE>
The 78.8% increase in the provision for losses on contract sales in the
first quarter of 1996 reflects the growth in total contract sales and the
Company's increased provision for losses on contracts sales as a percentage of
contracts sold. This increased percentage is a result of increasing average
contract terms and the changing mix of originations to loans which have a
lower down payment. The increase in the provision for losses on contract
sales was offset by the change in mix of contracts sold.
The following table sets forth the Company's contract originations and sales
for the three-month periods ended March 31, 1996 and 1995. Dollar amounts are
in thousands.
<TABLE>
<CAPTION>
Three-month
period ended
March 31,
1996 1995
---------- ----------
<S> <C> <C>
Originations:
Manufactured Housing $ 898,035 $717,133
Home Improvement/Home Equity 163,003 116,292
Consumer Products and Other 206,808 61,082
---------- --------
Total $1,267,846 $894,507
========== ========
Sales:
Manufactured Housing $ 864,035 $708,371
Home Improvement 118,857 100,075
Consumer Products and Other 431,147 --
---------- --------
Total $1,414,039 $808,446
========== ========
</TABLE>
The manufactured housing market experienced an increase in new home shipments
during the first quarter of 1996 compared to 1995. The Company continues to
benefit from this increase and believes that it is maintaining its market
share of contracts for financing new manufactured homes. The Company's dollar
volume of new manufactured housing contract originations rose 23.1% during the
first quarter of 1996 over the same period in 1995. The dollar volume of
previously owned manufactured housing contract originations also rose 43.7%.
The dollar volume of refinanced contracts increased slightly during the first
quarter of 1996 compared to 1995. The number of new contracts originated by
the Company during the first quarter of 1996 has grown from 1995 and the
average contract size has also increased due to a shift in the Company's
manufactured home financing to more land-and-home contracts and price
increases by the manufactured housing manufacturers.
The dollar volume of home improvement/home equity, consumer products and other
contract originations rose 108.5% in the first quarter of 1996 over 1995.
This significant level of growth in these divisions results from expanding the
number of relationships with contractors, remodelers and dealers throughout
the United States. This has provided the Company with an established and
growing network through which to market its financing.
9
<PAGE>
Interest income is realized from contract inventory, commercial finance
receivables, cash deposits, short-term investments, as well as amortization of
the present value discount relating to excess servicing rights receivable.
Interest income grew 38.2% during the first quarter of 1996 compared to the
same period in 1995 primarily from increased earnings on the Company's
commercial finance receivables, the increase in the amortization of the
present value discount on the Company's growing excess servicing rights
receivable and interest accrued on the subordinated Net Interest Margin
Certificates. Due to higher production levels, contract inventory for the
three-months ended March 31, 1996 was higher on average than the same period
in 1995 which also contributed to the increase in interest income.
The increase in service income of 38.4% during the first quarter of 1996
compared to the first quarter of 1995 resulted from the 39% growth in the
Company's average originated servicing portfolio but was partially offset by
the decline in servicing income on contracts originated by others. The
average unpaid principal balance of contracts being serviced for others
decreased 20.8% during the first quarter of 1996 compared to the first quarter
of 1995. The Company expects this decline in outside servicing to continue in
the future while overall servicing income should increase as its portfolio
grows.
Commissions and other income, which includes commissions earned on new
insurance policies written and renewals on existing policies, as well as other
income from late fees, grew 7.8% during the first quarter of 1996 compared to
the same period in 1995. This growth is primarily a result of the increase in
net written insurance premiums as the Company's contract originations and
servicing portfolio continue to grow.
Interest expense increased 8.9% during the first quarter of 1996 as a result
of the Company maintaining a higher level of borrowings to fund its loan
originations and commercial finance portfolio during the first quarter of 1996
compared to 1995. This increase was partially offset by lower average
interest rates in the first quarter of 1996.
Green Tree's dollar amount of cost of servicing increased 39.7% during the
first quarter of 1996 compared to the same period in 1995 as the Company's
total average servicing portfolio grew 37.7%. The Company's cost of servicing
as a percentage of contracts serviced in the first quarter of 1996 increased
slightly compared to the same period in 1995.
General and administrative expenses rose 37.9% in the first quarter of 1996.
As a percentage of contract originations, these expenses have remained
consistent with the first quarter of 1995. The dollar growth is due primarily
to an increase in personnel and other costs related to the start-up and growth
of the Company's new
10
<PAGE>
divisions as well as the increased volume of contracts the Company originated
during the quarter.
Capital Resources and Liquidity:
The Company's business requires continued access to the capital markets for
the purchase, warehousing and sale of contracts. To satisfy these needs, the
Company employs a variety of capital resources.
Historically, the most important liquidity source for the Company has been its
ability to sell contracts in the secondary markets through loan
securitizations and sales of GNMA certificates. During the first quarter of
1996, the Company used a senior/subordinated structure for each of its two
conventional manufactured home loan sales and enhanced a portion of the
subordinated certificates sold with a corporate guarantee. The Company's
public home improvement loan sale in the first quarter of 1996 was comprised
of two trusts. The first trust, which included secured home improvement
contracts, employed a senior/subordinated structure with a corporate guarantee
and the second trust, which included unsecured home improvement contracts, was
a single class pass-through with a corporate guarantee. In addition, the
first quarter sale of consumer products and equipment finance loans employed a
multi-class credit tranched grantor trust structure with a limited corporate
guarantee on the most junior tranche.
Servicing fees and net interest payments collected, which has been the
Company's principal source of cash, increased during the three-month period
ended March 31, 1996 over the same period in 1995. Contributing to this
growth is an increase in normal servicing fees collected by the Company on its
growing servicing portfolio, and an increase in excess servicing collected
from the additional securitizations in which the Company has not sold a
portion of the related excess servicing rights.
Net principal payments collected were positive in each of the three-month
periods ended March 31, 1996 and 1995 as a result of an increase in the
contract principal payments collected by the Company as of the end of each
period but not yet remitted to the investors/owners of the contracts. These
increases are a result of customer payoffs and the growth of the Company's
servicing portfolio of contracts which have been sold.
Interest on cash, commercial finance receivables and investments increased
significantly during the first quarter of 1996 compared to the same period in
1995 primarily as a result of the significant increase in commercial finance
receivables serviced. The Company's commercial finance division, which
provides inventory and asset-based financing for manufacturers and dealers in
a variety of industries, primarily manufactured housing and other products for
which the Company provides retail financing, earned a net spread on
11
<PAGE>
approximately $428 million of sold receivables which it continues to service,
as well as interest income on average net receivables of $223 million in its
portfolio during the first quarter of 1996. During the same period in 1995
the Company earned interest on average net receivables outstanding of $248
million and had not yet securitized any of its commercial finance receivables.
Cash paid to employees and suppliers increased $31,562,000 in the first
quarter of 1996 compared to the same period in 1995. This growth relates
primarily to the increase in the Company's portion of taxes paid in 1996 on
the annual bonus of the chief executive officer pursuant to the terms of an
employment agreement, as well as the 38.3% growth in the Company's total
general and administrative expenses and servicing costs.
Dividends paid by the Company increased 33.6% in the first quarter of 1996
compared to the same period in 1995 as the Company's quarterly dividend rate
increased 33.3% over the first quarter 1995 quarterly dividend rate.
The Company had a $15,000,000 unsecured bank credit agreement for general
operating purposes as of March 31, 1996 and closed a new $500 million
unsecured bank credit agreement on April 16, 1996, replacing this existing
facility. This new credit facility is a three-year committed revolving line
of credit which expires April 15, 1999. In addition, the Company currently
has $1.3 billion in master repurchase agreements with various investment
banking firms for the purpose of financing its contract and commercial finance
loan production. At March 31, 1996, the Company had no borrowings outstanding
under these agreements and had $1,247,500,000 available, subject to the
availability of eligible collateral. The master repurchase agreements
generally provide for annual terms that are extended each quarter by mutual
agreement of the parties for an additional annual term based upon receipt of
updated quarterly financial information from the Company. The Company
believes that these agreements will continue to be renewed.
The Company also has a commercial paper program through which it is authorized
to issue up to $500,000,000 in notes of varying terms (not to exceed 270 days)
to meet its liquidity needs. This program is backed by the bank and master
repurchase agreements referred to above. As of March 31, 1996, the Company
had issued and outstanding $67,500,000 in notes under this program.
Commercial paper is expected to be an ongoing source of liquidity for purposes
of meeting the Company's funding needs between sales of its contract and
commercial loan production.
12
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The nature of the Company's business is such that it is routinely
a party or subject to items of pending or threatened litigation.
Although the ultimate outcome of certain of these matters cannot
be predicted, management believes, based upon information
currently available and the advice of counsel, that the
resolution of these routine legal matters will not result in any
material adverse effect on its consolidated financial condition.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. (A) EXHIBITS
11. Computation of Per Share Amounts.
12. Computation of Ratio of Earnings to Fixed
Charges.
27. Financial Data Schedule.
(B) REPORTS ON FORM 8-K
None.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GREEN TREE FINANCIAL CORPORATION
DATE: May 13, 1996 /s/Robley D. Evans
------------------------------
Robley D. Evans
Vice President and Controller
DATE: May 13, 1996 /s/Joel H. Gottesman
------------------------------
Joel H. Gottesman
Senior Vice President and
General Counsel
14
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Page
- --------- ------- ----
<S> <C> <C>
11. Computation of Per Share Amounts. 16
12. Computation of Ratio of Earnings to
Fixed Charges. 17
27. Financial Data Schedule. 18
</TABLE>
15
<PAGE>
Exhibit 11.
-----------
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
COMPUTATION OF PER SHARE AMOUNTS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
---------------------------
1996 1995
------------- ------------
<S> <C> <C>
PRIMARY:
Net earnings $ 66,362,000 $ 50,729,000
============ ============
Weighted average number of
common and common equivalent
shares outstanding:
Weighted average common
shares outstanding 136,224,524 135,909,288
Dilutive effect of stock
options after application
of treasury-stock method 3,360,302 3,621,186
------------ ------------
139,584,826 139,530,474
============ ============
Earnings per share $.48 $.36
==== ====
FULLY DILUTED:
Net earnings $ 66,362,000 $ 50,729,000
============ ============
Weighted average number of
common and common equivalent
shares outstanding:
Weighted average common
shares outstanding 136,224,524 135,909,288
Dilutive effect of stock
options after application
of treasury-stock method 3,710,093 3,796,726
------------ ------------
139,934,617 139,706,014
============ ============
Earnings per share $.47 $.36
==== ====
</TABLE>
16
<PAGE>
Exhibit 12.
-----------
GREEN TREE FINANCIAL CORPORATION AND SUBSIDIARIES
-------------------------------------------------
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
-------------------------------------------------
<TABLE>
<CAPTION>
Three months
ended
March 31, 1996
---------------
(unaudited)
<S> <C>
Earnings:
Earnings before income taxes $107,036,000
Fixed charges:
Interest 11,364,000
One-third rent 620,000
------------
11,984,000
------------
$119,020,000
============
Fixed charges:
Interest $ 11,364,000
One-third rent 620,000
------------
$ 11,984,000
============
Ratio of earnings to fixed charges (1) 9.93
============
</TABLE>
(1) For purposes of computing the ratio, earnings consist of earnings before
income taxes plus fixed charges.
17
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Green Tree
Financial Corporation and Subsidiaries for the three-month period ended March
31, 1996 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 520,573,000
<SECURITIES> 20,100,000
<RECEIVABLES> 358,374,000
<ALLOWANCES> 1,469,000
<INVENTORY> 733,006,000
<CURRENT-ASSETS> 0
<PP&E> 91,530,000
<DEPRECIATION> 31,161,000
<TOTAL-ASSETS> 2,614,615,000
<CURRENT-LIABILITIES> 0
<BONDS> 289,997,000
<COMMON> 1,387,000
0
0
<OTHER-SE> 1,014,628,000
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<EPS-PRIMARY> .48
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</TABLE>
