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March 10, 2005
Medallion Announces 2004 Fourth Quarter and Full Year Results
Annual Highlights
- Net Investment Income After Taxes Increases To $0.29 From $0.08
- EPS Increases To $1.22 From $0.11
- Medallion Loans Increase 36% To All-Time High
- Commercial Loans Increase 59%
- Total Assets Increase 55% To All-Time High
Charts
- Consolidated Income Statements
- Consolidated Balance Sheets
NEW YORK, NY - March 10, 2005 -- Medallion Financial Corp. (Nasdaq: TAXI), a specialty finance company with a leading position servicing the taxicab industry and targeted niche markets in commercial and consumer finance, announced net investment income after taxes of $2,138,000 or $0.12 per share in the 2004 fourth quarter, compared to $174,000 or $0.01 per share in the 2003 fourth quarter. Net increase in net assets resulting from operations was $3,588,000 or $0.20 per share in the quarter, compared to a decrease of $278,000 or $0.01 per share in the 2003 fourth quarter.
Net investment income after taxes was $5,427,000 or $0.29 per share for the 2004 full year, compared to $1,414,000 or $0.08 per share in 2003. Net increase in net assets resulting from operations was $22,512,000 or $1.22 per share for the year, compared to $2,018,000 or $0.11 per share for 2003.
Andrew Murstein, President of Medallion Financial stated, "We are very pleased with the year's results. Net investment income in the fourth quarter was the highest it has been in over three years. Year 2004 earnings, due in large part from the sale of our taxi top advertising division, were the highest they have been in the history of the Company.
Mr. Murstein continued, "During 2004, we improved our profitability and significantly grew our taxicab medallion loan portfolio by a substantial 36%. Medallion loans reached $391 million, an all-time high. We opened Medallion Bank for business and began taking federally-insured deposits at the lowest cost of funds in our history. We more than doubled our dividend, reduced the percentage of delinquent loans, and successfully completed our first stock repurchase program. We also increased our book value per share to $9.83 from $8.89. We have sold off underperforming divisions, and are focusing on our medallion lending and other more profitable divisions. We are confident that we are well positioned to build on this success, and we remain optimistic about our prospects for the future."
Larry Hall, Medallion's CFO stated, "During the year our net interest margin increased to 4.37% from 3.72%. In January 2005, we extended the term and lowered the cost of funds of our Merrill Lynch credit facility, and those results should be evident in the coming quarters. We remain extremely well capitalized, with a total debt to equity ratio of only 3.1 to 1. We plan on continuing to leverage our balance sheet to further maximize shareholder value."
Mr. Hall continued, "In addition to substantial improvements in profitability and asset growth, one of the things we are proud of is our continued improvement in credit quality. During the year, loans 90 days or more past due decreased to 3.2% from 5.0% of the total loan portfolio. Our delinquencies are now the lowest they have been in over three years. Medallion prices continue to outperform, with corporate medallion values growing from $200,000 a few years ago to almost $400,000 today. The average loan-to-value ratio on our loan portfolio is now under 60%."
The Company also announced that it is increasing its quarterly dividend to $0.11 per share from $0.07 in the 2003 fourth quarter. For the year, the Company declared dividends of $0.37 per share, up from $0.16 in 2003. Approximately half of this dividend is eligible for capital gains tax treatment. Over the last eight quarters, dividends have increased steadily, from $0.01, to $0.03, to $0.05, to $0.07, to $0.08, to $0.08, to $0.10, to $0.11. The current $0.11 dividend will be paid on March 26, 2005 to shareholders of record on March 11, 2005.
Medallion Financial Corp. is a specialty finance company with a leading position in the origination and servicing of loans financing the purchase of taxicab medallions and related assets. The Company also originates and services commercial and consumer loans financing small businesses and other targeted industries. The Company and its subsidiaries have lent over $2 billion to the taxicab and other targeted industries.
Please note that this press release contains forward-looking statements that involve risks and uncertainties relating to business performance, cash flow, costs, sales, net investment income, earnings, and growth. Medallion's actual results may differ significantly from the results discussed in such forward-looking statements. Factors that might cause such a difference include, but are not limited to, those factors discussed under the heading "Investment Considerations," in Medallion's 2003 Annual Report on Form 10-K.
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