THIS REPORT HAS BEEN FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION VIA EDGAR
------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 1997
Commission File No. 1-11121
T F C E N T E R P R I S E S, I N C.
(Exact name of registrant as specified in its charter)
Delaware 54-1306895
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5425 Robin Hood Road
Suite 101B
Norfolk, Virginia 23513
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code -- (757) 858-1400
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 par value per share
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 May 7, 1997, there were 11,290,308 outstanding shares of the registrant's
$.01 par value per share common stock.
<PAGE>
TFC ENTERPRISES, INC. AND SUBSIDIARIES
QUARTERLY REPORT ON FORM 10-Q FOR
THE THREE MONTHS ENDED MARCH 31, 1997
Table of Contents and 10-Q Cross Reference Index
Part I - Financial Information Page No.
- ------------------------------ --------
Financial Highlights 3
Financial Statements (Item 1)
Consolidated Balance Sheets 4
Consolidated Statements of Operations 5
Consolidated Statements of Changes in Shareholders' Equity 6
Consolidated Statements of Cash Flows 7
Notes to Consolidated Financial Statements 8
Management's Discussion and Analysis of Financial Condition
and Results of Operations (Item 2) 11
Part II - Other Information
Exhibits and Reports on Form 8-K (Item 6) 16
Signatures 17
Index to Exhibits 18
2
<PAGE>
TFC ENTERPRISES, INC.
FINANCIAL HIGHLIGHTS
(Unaudited)
<TABLE>
<CAPTION>
Three months
(dollars in thousands, except ended March 31,
per share amounts) 1997 1996
<S> <C>
Net income $ 196 $ 740
Net income per common share $ .07 $ .07
Average common and common equivalent
shares outstanding (in thousands) 11,290 11,286
- ---------------------------------------------------------------------------------------------
Performance ratios (annualized, as appropriate):
Return on average common equity 2.62% 8.02%
Return on average assets 0.51 1.43
Yield on interest-earning assets 21.05 22.23
Cost of interest-bearing liabilities 10.28 9.48
Net interest margin 13.35 15.09
Operating expense as a percentage of
average interest-earning assets 12.60 11.63
Total net charge-offs to average
gross contract receivables,
net of unearned interest 21.15 22.66
60+ days delinquencies to period-end
gross contract receivables 9.01 9.14
Total allowance and nonrefundable reserve
to period end gross contract receivables,
net of unearned interest 16.60 18.53
Equity to assets, period end 19.76 18.95
- ---------------------------------------------------------------------------------------------
Average balances:
Interest-earning assets (a) $157,236 $216,214
Total assets 155,144 207,547
Interest-bearing liabilities 117,777 162,700
Equity 29,944 36,930
- ---------------------------------------------------------------------------------------------
</TABLE>
Note: Throughout this report, ratios are based on unrounded numbers and factors
contributing to changes between periods are noted in descending order of
materiality.
(a) Average interest-bearing deposits and gross contract receivables net of
unearned interest revenue and unearned discount.
3
<PAGE>
TFC ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
March 31, December 31,
(dollars in thousands) 1997 1996
--------- ----------
Assets
Cash and cash equivalents $ 2,639 $ 2,688
Restricted cash 4,593 5,532
Net contract receivables 121,063 126,252
Recoverable income taxes 5,829 5,831
Property and equipment, net 2,747 2,823
Intangible assets, net 12,888 13,161
Deferred income taxes 188 188
Other assets 2,161 2,108
-------- --------
Total assets $152,108 $158,583
======== ========
Liabilities and shareholders' equity
Liabilities:
Revolving line of credit $ 76,298 $ 72,562
Term notes 14,975 19,464
Automobile Receivables - Backed notes 10,639 15,843
Subordinated notes 12,520 12,509
Accounts payable and accrued expenses 3,143 3,960
Income taxes 2,358 2,075
Refundable dealer reserve 1,913 2,208
Other liabilities 204 100
---------- ---------
Total liabilities 122,050 128,721
Shareholders' equity:
Preferred stock, $.01 par value, 1,000,000 shares
authorized; none outstanding -- --
Common stock, $.01 par value, 40,000,000 shares
authorized; 11,290,308 outstanding 49 49
Additional paid-in capital 55,333 55,333
Retained deficit (25,324) (25,520)
-------- ---------
Total shareholders' equity 30,058 29,862
-------- ---------
Total liabilities and shareholders' equity $152,108 $158,583
======= =======
See accompanying Notes to Consolidated Financial Statements.
4
<PAGE>
TFC ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
March 31, March 31,
(in thousands, except per share amounts) 1997 1996
---------- ------------
<S> <C>
Interest and other finance revenue $ 8,275 $ 12,015
Interest expense 3,027 3,858
------- -------
Net interest revenue 5,248 8,157
Provision for credit losses 92 1,000
--------- -------
Net interest revenue after provision for credit losses 5,156 7,157
Other revenue:
Commissions on ancillary products 253 510
Other 23 44
--------- --------
Total other revenue 276 554
Operating expense:
Salaries 2,443 3,318
Employee benefits 323 547
Occupancy 236 220
Equipment 294 262
Amortization of intangible assets 273 273
Other 1,384 1,666
-------- -------
Total operating expense 4,953 6,286
-------- -------
Income before income taxes 479 1,425
Provision for income taxes 283 685
--------- -------
Net income $ 196 $ 740
======== =======
Net income per common share $ .02 $ .07
========= =======
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
5
<PAGE>
TFC ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
March 31,
(in thousands) 1997 1996
---- ----
<S> <C>
Common stock
Balance at end of period $ 49 $ 49
====== ======
Additional paid-in capital
Balance at beginning of period $ 55,333 $ 54,279
Stock options exercised - 6
--------- ---------
Balance at end of period $ 55,333 $ 54.285
====== ======
Retained deficit
Balance at beginning of period $(25,520) $(17,924)
Net income 196 740
--------- ---------
Balance at end of period $(25,324) $(17,184)
========= =========
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
6
<PAGE>
TFC ENTERPRISES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
March 31,
(in thousands) 1997 1996
---- ----
<S> <C>
Operating activities
Net income $ 196 $ 740
Adjustments to reconcile net income to net
cash provided by operating activities:
Amortization of intangible assets 273 273
Depreciation and other amortization 406 405
Provision for deferred income taxes -- 4,191
Provision for credit losses 92 1,000
Changes in operating assets and liabilities:
Decrease in recoverable income taxes 2 86
Increase in other assets (172) (127)
(Decrease) increase in accounts payable and accrued expenses (817) 751
Increase in income taxes 283 --
Decrease in refundable dealer reserve (295) (1,004)
Increase in other liabilities 104 183
------ -------
Net cash provided by operating activities 72 6,498
------ -----
Investing activities
Net cost of acquiring contract receivables (21,954) (16,288)
Repayment on contract receivables 27,052 32,152
Purchase of property and equipment (147) (857)
----- -----
Net cash provided by investing activities 4,951 15,007
------ -------
Financing activities
Net borrowings (payments) on revolving line of credit 3,682 (4,620)
Payments on Term notes (4,489) (7,000)
Payments on Automobile Receivables-Backed notes (5,204) (8,217)
Decrease in restricted cash 939 741
Proceeds from stock options exercised -- 6
--------- ---------
Net cash used in financing activities (5,072) (19,090)
--------- ---------
(Decrease) increase in cash and cash equivalents (49) 933
Cash and cash equivalents at beginning of period 2,688 2,110
------ ------
Cash and cash equivalents at end of period $ 2,639 $ 3,043
====== ======
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
7
<PAGE>
TFC ENTERPRISES, INC.
Notes to Consolidated Financial Statements
1. Summary of significant accounting policies
Organization and business. TFC Enterprises, Inc. ("TFCE") is a holding company
that owns two primary subsidiaries, The Finance Company ("TFC") and First
Community Finance, Inc. ("FCF"). TFCE has no significant operations of its own.
TFC specializes in purchasing and servicing installment sales contracts
originated by automobile and motorcycle dealers in the sale of used automobiles,
vans, light trucks, and new and used motorcycles (collectively "vehicles") both
on an individual basis ("point of sale" purchase) and on a portfolio basis
("portfolio" purchase). Based in Norfolk, Virginia, TFC also has offices in
Dallas, Texas; Jacksonville, Florida; and San Diego, California. FCF is involved
in the direct origination and servicing of small consumer loans. FCF operates
branch offices in Virginia and North Carolina.
Basis of presentation. The unaudited consolidated financial statements of the
Company are prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. These financial statements should be read in
conjunction with the Company's 1996 Annual Report on Form 10-K. In the opinion
of management, all normal recurring adjustments which management of the Company
considers necessary for a fair presentation of the financial position and
results of operations for the periods are reflected in the financial statements.
Operating results for the three months ended March 31, 1997, are not necessarily
indicative of the results that may be expected for the entire year ending
December 31, 1997.
2. Contract receivables
The following is a summary of contract receivables at March 31, 1997, and
December 31, 1996:
March 31, Dec. 31,
(in thousands) 1997 1996
--------- ----------
Contract receivables:
Auto finance $163,382 $177,388
Consumer finance 9,834 9,645
-------- --------
Gross contract receivables 173,216 187,033
Less:
Unearned interest revenue 25,274 27,200
Unearned discount 461 504
Unearned commissions 1,065 1,132
Unearned service fees 351 324
Payments in process 8 2,560
Escrow for pending acquisitions 433 486
Allowance for credit losses 5,275 11,730
Nonrefundable reserve 19,286 16,845
------- -------
Net contract receivables $121,063 $126,252
======= =======
8
<PAGE>
TFC ENTERPRISES, INC.
Notes to Consolidated Financial Statements (continued)
2. Contract receivables (continued)
Changes in the allowance for credit losses and nonrefundable reserve for the
three months ended March 31, 1997 and 1996 were as follows:
Three months ended
March 31,
(in thousands) 1997 1996
---- ----
Allowance for credit losses
Balance at beginning of period $11,730 $23,046
Provision for credit losses 92 1,000
Charge-offs (7,762) (4,540)
Recoveries 1,215 1,888
------ -------
Balance at end of period $ 5,275 $21,394
====== ======
Nonrefundable reserve
Balance at beginning of period $16,845 $20,436
Allocation for credit losses 3,990 3,023
Charge-offs (1,549) (9,072)
------- -------
Balance at end of period $19,286 $14,387
====== ======
9
<PAGE>
TFC ENTERPRISES, INC.
Notes to Consolidated Financial Statements (continued)
3. Computation of primary and fully diluted net income per common share
Primary and fully diluted net income per common share for the three months ended
March 31, 1997 and 1996 were as follows:
Three months ended
March 31,
(in thousands, except per share amounts) 1997 1996
---- ----
Primary net income per common share:
Net income $ 196 $ 740
Stock and stock equivalents (average shares):
Common shares outstanding 11,290 11,286
------ ------
Total stock and stock equivalents 11,290 11,286
------ ------
Primary net income per common share (a) $ .02 $ .07
======== ========
Fully diluted net income per common share:
Net income $ 196 $ 740
Stock and stock equivalents (average shares):
Common shares outstanding 11,290 11,286
------ ------
Total stock and stock equivalents 11,290 11,286
------ ------
Fully diluted net income per common share (a) $ .02 $ .07
======== ========
(a) Calculation based on unrounded numbers.
10
<PAGE>
TFC ENTERPRISES, INC.
Management's Discussion And Analysis Of Financial Condition
And Results Of Operations
This report contains forward-looking statements which involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including, but not limited to, those factors set forth elsewhere in this report.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which reflect management's analysis only as of the date hereof.
For example, during 1997 the Company's operations could be materially adversely
affected if interest rates were to rise, if credit experience deteriorated, or
the Comapny were to face increased competition.
Results of Operations
First quarter 1997 net income was $0.2 million, or $.02 per common share,
compared to net income of $0.7 million, or $.07 per common share, in the first
quarter of 1996. The primary cause of the lower reported earnings was a
reduction of $2.9 million in net interest revenue, from $8.2 million in the
first quarter of 1996 to $5.3 million in the first quarter of 1997. This drop in
revenue was partially offset by a reduction of $1.3 million in operating
expenses, from $6.3 million in the first quarter of 1996 to $5.0 million in the
first quarter of 1997, and by a reduction of $0.9 million in the provision for
credit losses, from $1.0 million in the first quarter of 1996 to $0.1 million in
the first quarter of 1997.
Volume. Gross contracts purchased or originated totaled $34.3 million in the
first quarter of 1997, or 32% above the $25.9 million purchased in the first
quarter of 1996. The increase was attributable primarily to a $6.5 million
increase in portfolio purchases, resulting from increased management emphasis on
this line of business.
Gross contracts purchased or originated were as follows for the three months
ended March 31, 1997 and 1996:
<TABLE>
<CAPTION>
Gross contract volume Three months ended
March 31,
1997 1996
---------------------------- --------------------------------
(dollars in thousands) Amount Percent Amount Percent
<S> <C>
Contracts purchased or originated:
Auto finance:
Point-of-sale $15,675 45.6% $14,327 55.3%
Portfolio 16,405 47.8 9,877 38.1
Consumer finance 2,267 6.6 1,698 6.6
----- ---- ------ ----
Total $34,347 100.0% $25,902 100.0%
====== ===== ====== =====
Number of contracts purchased or
originated:
Auto finance:
Point-of-sale 1,410 24.4% 1,641 37.4%
Portfolio 3,272 56.6 1,850 42.2
Consumer finance 1,103 19.0 892 20.4
----- ---- ----- ----
Total 5,785 100.0% 4,383 100.0%
===== ===== ===== =====
</TABLE>
Net interest revenue. Net interest revenue for the first quarter of 1997 totaled
$5.3 million, a decrease of 34%, from $8.2 million in the prior year period. The
decrease in net interest revenue resulted primarily from a reduction of $59.0
million in the balance of average interest-earning assets from $216.2 million in
the first quarter of 1996 to
11
<PAGE>
TFC ENTERPRISES, INC.
$157.2 million in the first quarter of 1997. The decrease in average
interest-earning assets, in turn, was caused by the Company's
previously-announced strategic decision in late 1995 to discontinue
substantially all civilian point-of-sale business, which reduced new loan volume
and contract receivables outstanding during 1996 and 1997 compared to 1995.
The yield on interest-earning assets was 21.1% in the first quarter of 1997,
compared to 22.2% in the first quarter of 1996. The decrease was attributable to
a reduction in the amount of contract purchase discount accreted to interest
revenue as a yield enhancement and to a decrease in the weighted average annual
percentage rate of the contract receivables portfolio.
The cost of interest-bearing liabilities was 10.3% in the first quarter of 1997,
compared with 9.5% in the first quarter of 1996. The increase was primarily
attributable to higher interest rates charged to the Company under new and
amended agreements with its lenders, as more fully disclosed in the TFC
Enterprises, Inc. 1996 Annual Report on Form 10-K.
The following table summarizes net interest revenue and the net interest margin
for the three months ended March 31, 1997 and 1996:
Net interest revenue
Three months ended
March 31,
(dollars in thousands) 1997 1996
---- ----
Average interest earning assets (a) $157,236 $216,214
Average interest bearing liabilities 117,777 162,700
------- -------
Net interest earning assets $ 39,459 $ 53,514
====== ======
Interest and other finance revenue $ 8,275 $12,015
Interest expense 3,027 3,858
------ -------
Net interest revenue $ 5,248 $ 8,157
===== =====
Yield on interest-earning assets 21.05% 22.23%
Cost of interest-bearing liabilities 10.28 9.48
----- -----
Net interest spread 10.77% 12.75%
===== =====
Net interest margin (b) 13.35% 15.09%
===== =====
(a) Average interest-bearing deposits and gross contract receivables net of
unearned interest revenue and unearned discount.
(b) Net interest margin is annualized net interest revenue divided by average
interest-earning assets.
Operating expense. Operating expense was $5.0 million in the first quarter of
1997, compared with $6.3 million in the first quarter of 1996. The decrease in
operating expenses of $1.3 million, or 21%, reflects the impact of the Company's
previously-announced restructuring plans implemented during 1996 to consolidate
service center operations from three locations into two and to downsize the
management staff, as discussed more fully in the TFC Enterprises, Inc. 1996
Annual Report on Form 10-K.
12
<PAGE>
TFC ENTERPRISES, INC.
Other matters. The Company is testing and modifying its computer systems, as
necessary, to ensure that the situation commonly referred to as the "year 2000
problem" will not have a significant effect on operations or financial
condition. The problem arises when computer programs cannot process data for the
year 2000 and beyond. It is estimated that the cost of addressing the year 2000
problem and making the Company's computer systems year 2000 compliant will not
be material.
Financial Condition
Assets. Total assets decreased by $6.5 million, or 4.1%, to $152.1 million at
March 31, 1997, from $158.6 million at December 31, 1996. The decrease was
primarily attributable to a reduction in net contract receivables caused by
liquidations exceeding new contract purchases and originations.
The following table summarizes net contract receivables at March 31, 1997 and
December 31, 1996:
Net contract receivables March 31, Dec.31,
(in thousands) 1997 1996
----- ------
Auto finance:
Point-of-sale $ 77,095 $ 80,725
Portfolio 34,978 36,711
Consumer finance 8,990 8,816
-------- --------
Total $121,063 $126,252
======== ========
Liabilities. Total liabilities were $122.1 million at March 31, 1997, a decrease
of $6.7 million, or 6%, from December 31, 1996. The decrease in liabilities
compared with year-end 1996 primarily reflected decreased borrowings under the
Company's credit facilities which, in turn, resulted from a contraction in net
contract receivables.
13
<PAGE>
TFC ENTERPRISES, INC.
Credit Quality and Reserves
At March 31, 1997, the combination of the Company's allowance for credit losses
and nonrefundable dealer reserve totaled $24.6 million, or 16.6%, of contract
receivables net of unearned interest revenue. This compares to $28.5 million, or
17.9%, at December 31, 1996. In addition, the Company's refundable dealer
reserve, which is available to absorb losses relating to contracts purchased
from certain dealers, totaled $1.9 million at March 31, 1997, compared to $2.2
million at December 31, 1996. The decrease in reserves and in the percentage of
reserves to contract receivables in 1997, compared to 1996, is the result of the
decrease in contract receivables outstanding in 1997 compared to 1996, and the
improved credit quality of the contracts.
Net charge-offs. Net charge-offs to the allowance for credit losses and
nonrefundable dealer reserve were $8.1 million in the first quarter of 1997,
representing an annualized rate of 21.15% of average gross contract receivables
net of unearned interest revenue. This compares to $11.7 million, or 22.7%, in
the first quarter of 1996. The decrease in net charge-offs in the first quarter
of 1997, relative to the comparable period in 1996, was due primarily to the
decrease in contract receivables outstanding in 1997 and the improved credit
quality of the contracts.
Net charge-offs for the three months ended March 31, 1997 and 1996 were as
follows:
Net charge-offs Three months ended
March 31,
(in thousands) 1997 1996
---- ----
Auto finance:
Point-of-sale $ 5,179 $10,051
Portfolio 2,837 1,658
Consumer finance 80 15
-------- --------
Total $ 8,096 $11,724
====== ======
Gross contract receivables that were 60 days or more delinquent at March 31,
1997 and December 31, 1996 were as follows:
Delinquency March 31, Dec. 31,
(dollars in thousands) 1997 1996
----- ----
Gross contract receivables
60 days and more delinquent $ 15,599 $ 18,495
Gross contract receivables 173,216 187,033
Percent 9.01% 9.89%
Provision for credit losses. The Company's primary business involves purchasing
installment sales contracts at a discount to the remaining principal balance. A
portion of the discount is generally held in a nonrefundable dealer reserve
against which credit losses are first applied. Additional provisions for credit
losses, if necessary, are charged to income in amounts considered by management
to be adequate to absorb future credit losses. The provision for credit losses
totaled $0.09 million in the first quarter of 1997 and $1.0 million in the first
quarter of 1996.
14
<PAGE>
TFC ENTERPRISES, INC.
The decrease in the provision for credit losses reflects the improved credit
quality and servicing of auto finance loans, which eliminated the need for a
loss provision in the first quarter of 1997 compared to a provision of $0.95
million in the first quarter of 1996. The provision for credit losses on the
Company's consumer finance loan business increased to $0.09 million in the first
quarter of 1997, compared to $0.05 million in the first quarter of 1996 as a
result of growth in the consumer finance receivables.
Provision for credit losses is dependent on a number of factors, including, but
not limited to, the level and trend of delinquencies and net charge-offs, the
amount of nonrefundable and refundable dealer reserves and the overall economic
conditions in the markets in which the Company operates. Because of the inherent
uncertainty involved in predicting the future performance of these factors,
there can be no assurance regarding the future level of provision for credit
losses.
Liquidity and Capital Resources
Liquidity management. As shown in the Consolidated Statements of Cash Flows,
cash and cash equivalents remained constant in the first quarter of 1997 at $2.7
million. The constancy reflected $5.0 million of net cash provided by investing
activities partially offset by $5.1 million of net cash used in financing
activities. Net cash provided by investing activities resulted from the
repayment of contract receivables in excess of the net cost of acquiring
contract receivables. Net cash used in financing activities reflected $5.2
million repayment on borrowings on automobile receivables-backed notes, $4.5
million repayment on term notes, offset in part by $3.7 million in net
borrowings under the Company's revolving line of credit facility. For the first
three months of 1996, net cash used in financing activities totaled $19.1
million, primarily reflecting $8.2 million repayment on borrowings on automobile
receivables-backed notes, 7.0 million repayment on term notes, and $4.6 million
in net payments under the Company's revolving line of credit facility. In the
first quarter of 1997, the combination of cash on hand and net cash provided by
investing activities was sufficient to fund business volume. In the first
quarter of 1996, the combination of cash on hand and net cash provided by
financing activities was sufficient to fund the growth in business volume.
Agreements with lenders. The Company executed amended agreements with its
lenders in April 1997, as more fully discussed in the TFC Enterprises, Inc. 1996
Annual Report on Form 10-K.
New Accounting Standard
In February 1997, the Financial Accounting Standards Board issued Statement No.
128 (FAS No. 128), "Earnings per Share," which is required to be adopted on
December 31, 1997. At that time, the Company will be required to change the
method currently used to compute earnings per share and to restate all prior
periods. Under the new requirements for calculating primary earnings per share,
the dilutive effect of stock options and warrants will be excluded. The impact
of FAS No. 128 on primary and fully diluted earnings per share for the first
quarter ended March 31, 1997, and March 31, 1996, is not expected to be
material.
15
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27.1 Financial Data Schedule, which is submitted
electronically to the Securities and Exchange
Commission for information only and not filed.
(b) Reports on Form 8-K
On February 5, 1997, the Company filed a report on Form 8-K,
under Item 5, regarding the signing of a commitment letter
between Hibernia National Bank's Commercial Finance Unit and
First Community Finance; a wholly owned subsidiary of TFC
Enterprises, Inc., for a new credit facility.
16
<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 thereunto duly authorized.
TFC ENTERPRISES, INC.
(Registrant)
Date: May 08, 1997 By:/s/ Robert S. Raley, Jr.
------------------------
Robert S. Raley, Jr.
Chairman, President,
Chief Executive Officer and
Director
Date: May 08, 1997 By:/s/ David W. Karsten
--------------------
David W. Karsten
Vice President, Treasurer
and Chief Financial Officer
(Principal Financial Officer
of the registrant)
17
<PAGE>
Index to Exhibits
Exhibit No. Description
------------- ------------
27.1 Financial Data Schedule, which is submitted
electronically to the Securities and
Exchange Commission for information only and
not filed.
18
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
TFC ENTERPRISES, INC. QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER
ENDED MARCH 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,639
<SECURITIES> 0
<RECEIVABLES> 145,624
<ALLOWANCES> 24,561
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 6,268
<DEPRECIATION> 3,521
<TOTAL-ASSETS> 152,108
<CURRENT-LIABILITIES> 122,050
<BONDS> 114,432
49
0
<COMMON> 0
<OTHER-SE> 30,009
<TOTAL-LIABILITY-AND-EQUITY> 152,108
<SALES> 8,275
<TOTAL-REVENUES> 8,551
<CGS> 0
<TOTAL-COSTS> 4,953
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 92
<INTEREST-EXPENSE> 3,027
<INCOME-PRETAX> 479
<INCOME-TAX> 283
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 196
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
