Walter Investment Management Corp. Announces Second Quarter 2010 Financial Results
Tuesday, August 10th, 2010
Walter Investment Management Corp. (NYSE Amex: WAC) announce results for the quarter ended June 30, 2010.
The Company reported income before income taxes for the quarter ended June 30, 2010 of $8.9 million, or $0.33 per diluted share, as compared to income before income taxes for the year ago period of $8.6 million, or $0.41 per diluted share. Net income for the second quarter of 2010 was $8.6 million, or $0.32 per diluted share, as compared to net income for the second quarter 2009 of $89.8 million, or $4.30 per diluted share, which included a non-cash tax benefit of $81.2 million related to WIM LLC’s conversion to a real estate investment trust (“REIT”) as part of its spin-off and merger transactions with Hanover Capital Mortgage Holdings, Inc. (“Hanover”) on April 17, 2009.
Mark J. O’Brien, Walter Investment’s Chairman and CEO, said, “We continue to see attractive opportunities in the market to acquire performing and nonperforming residential loans. While these opportunities remain our primary focus as we seek to grow the business, we continue to explore other options to expand our capabilities for growth and remain committed to prudently deploying our capital to acquire assets which meet our investment criteria and return objectives.”
Second Quarter 2010 Dividend Declaration
On August 3, 2010, the Board of Directors of the Company declared a dividend of $0.50 per share to shareholders of record as of August 13, 2010, which will be paid on August 27, 2010.
Second Quarter 2010 Operating Highlights
* Reflecting continued strong performance, consolidated delinquencies were 4.26 percent at June 30, 2010, as compared to 4.21 percent at March 31, 2010 and 5.06 percent at June 30, 2009. Walter Investment’s delinquency rates (adjusted to reflect comparable methodologies) remain better than the most recently released Mortgage Banker’s Association’s subprime industry survey average by more than 50 percent.
* On an annualized basis, the asset yield for the quarter ended June 30, 2010 was 10.25 percent and the Company’s interest cost on outstanding debt was 6.81 percent. The net interest margin for the quarter, which is net interest income as a percentage of average earning assets, was 5.10 percent, in-line with the second quarter of 2009.
* Loss severities were 14.3 percent in the second quarter, as compared to 11.9 percent for the first quarter of 2010 and 19.0 percent in the second quarter of 2009.
* During the second quarter of 2010, the Company paid dividends on April 30, 2010 of $12.9 million to its shareholders.
Charles E. Cauthen, Walter Investment’s President and COO, said, “The diligent efforts of our field servicing organization continue to yield superior results from our portfolio. The ability to produce these solid results will support our efforts to grow the business through the second half of 2010 and beyond. Based on the early performance of our newly acquired loan pools, we expect continued superior performance from both our existing portfolio and these newly purchased pools.”