EX-99.1 2 wrc_8k0803ex991.htm PRESS RELEASE wrc_8k0803ex991.htm
Exhibit 99.1

PRESS RELEASE
 
White River Capital, Inc.
www.WhiteRiverCap.com
(NYSE Mkt: RVR)
 

Contact:
 
 
Address:
 
 
 
Phone:
Martin J. Szumski
Chief Financial Officer
 
6051 El Tordo
P.O. Box 9876
Rancho Santa Fe, CA 92067
 
(858) 997-6740
  
     

August 3, 2012

WHITE RIVER CAPITAL, INC. ANNOUNCES
RESULTS FOR SECOND QUARTER 2012

·  
Second Quarter 2012 Net Income was $2.3 million
·  
Book Value per Share was $21.02

Rancho Santa Fe, California . . . White River Capital, Inc. (NYSE MKT: RVR) (“White River”) today announced net income for the second quarter 2012 of $2.3 million, or $0.65 per diluted share, compared to second quarter 2011 net income of $2.5 million, or $0.70 per diluted share. The net income results for the second quarter of 2012 are due to the following:

o  
$3.9 million of earnings from operations contributed by the Coastal Credit LLC (“Coastal Credit”) subsidiary, and
o  
$0.5 million of operating expenses at the holding company, and income tax expense of $1.1 million.

Martin Szumski, Chief Financial Officer, stated, "Coastal Credit’s 30+ day delinquency was 2.3% at June 30, 2012 compared to 2.0% at December 31, 2011. Coastal Credit’s allowance for loan losses as a percentage of finance receivables, net of unearned finance charges was 5.38% at June 30, 2012 compared to 5.68% at December 31, 2011.”

Mr. Szumski continued, "Shareholders’ equity was $74.5 million at quarter end or $21.02 per common share.”
 
 
 
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DIVIDEND

As previously announced, White River paid a quarterly dividend of 25 cents per share on its common stock on June 5, 2012.

STOCK REPURCHASE PROGRAM

Under a stock repurchase program announced on August 11, 2011, White River is authorized to repurchase up to 250,000 shares of its outstanding common stock, from time to time and subject to market conditions, on the open market or in privately negotiated transactions. As of June 30, 2012, White River has repurchased 62,829 shares of its outstanding common stock under this program at an average price per share of $19.40.

PROVISION FOR LOAN LOSSES

The consolidated provision for loan losses was $1.3 million compared to $0.7 million for the quarters ended June 30, 2012 and 2011, respectively.

The following table documents the quarterly provision, allowance for loan losses and net charge offs at Coastal Credit for the second quarter 2010 through the second quarter 2012:

 
 
Quarter
 
Provision
(in millions)
Allowance for Loan
Losses as a Percent of
Finance Receivables
Annualized Net Charge-offs
as a Percent of
Finance Receivables
2nd 2012
$1.3
5.38%
3.61%
1st 2012
$1.3
5.54%
3.71%
4th 2011
$1.3
5.68%
3.87%
3rd 2011
$0.9
5.83%
2.81%
2nd 2011
$0.7
6.07%
2.99%
1st 2011
$1.1
6.59%
4.14%
4th 2010
$1.3
6.92%
5.40%
3rd 2010
$1.6
7.19%
5.21%
2nd 2010
$1.6
7.33%
5.54%

This provision for loan losses at Coastal Credit reflects management’s assessment of the reserves necessary for the current credit environment.
 
 
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CREDIT QUALITY

The following tables set forth delinquency, charge-off and allowance levels for the Coastal Credit portfolio:

Coastal Credit LLC
                                    
Delinquency Rates Experienced - Finance Receivables
                                
(in thousands except percentages)
                                    
                                     
   
June 30,
  
December 31,
    
June 30,
  
   
2012
    
2011
    
2011
  
                                     
Finance receivables - gross balance
   $ 144,902           $ 137,277           $ 128,819        
                                           
Delinquencies:
                                          
30-59 days
   $ 1,527       1.1 %   $ 1,317       1.0 %   $ 999       0.8 %
60-89 days
     891       0.6 %     689       0.5 %     292       0.2 %
90+ days
     860       0.6 %     697       0.5 %     262       0.2 %
Total delinquencies
   $ 3,278       2.3 %   $ 2,703       2.0 %   $ 1,553       1.2 %
 
 
 
Coastal Credit LLC
                        
Allowance for Loan Losses - Finance Receivables
                        
(in thousands except percentages)
                        
                         
   
Quarters Ended
June 30,
    
Six Months Ended
June 30,
  
   
2012
    
2011
    
2012
    
2011
  
Balance at beginning of period
   $ 7,703     $ 7,953     $ 7,703     $ 8,153  
Charge-offs
     (1,931 )     (1,608 )     (3,851 )     (3,437 )
Recoveries
     639       659       1,270       1,238  
Provision for loan losses
     1,292       699       2,581       1,749  
                                 
Balance at the end of the period
   $ 7,703     $ 7,703     $ 7,703     $ 7,703  
                                 
Finance receivables, net of unearned finance charges
   $ 143,123     $ 126,839     $ 143,123     $ 126,839  
                                 
Allowance for loan losses as a percent of finance receivables, net of unearned finance charges
     5.38 %     6.07 %     5.38 %     6.07 %
                                 
Annualized net charge-offs as a percent of finance receivables, net of unearned finance charges
     3.61 %     2.99 %     3.61 %     3.47 %
                                 
Allowance for loan losses as a percent of annualized net charge-offs
     149.05 %     202.92 %     149.23 %     175.15 %
 
 
 
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ABOUT WHITE RIVER AND COASTAL CREDIT

Founded in 2004, White River is the holding company for Coastal Credit LLC.

Coastal Credit LLC is a specialized auto finance company, headquartered in Virginia Beach, Virginia, engaged in acquiring sub-prime auto receivables from both franchised and independent automobile dealers which have entered into contracts with purchasers of typically used, but some new, cars and light trucks.  Coastal Credit then services the receivables it acquires. Coastal Credit commenced operations in Virginia in 1987 and conducts business in 27 states – Alaska, California, Colorado, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maryland, Mississippi, Missouri, Nevada, New Mexico, North Carolina, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia and Washington – through its 14 branch locations. The Coastal Credit receivables portfolio, net of unearned finance charges, was $143.1 million at June 30, 2012.

ADDITIONAL INFORMATION AND WHERE TO FIND IT

Additional information about White River is available at White River’s web site located at: www.WhiteRiverCap.com.

This site includes financial highlights, stock information, public filings with the U.S. Securities and Exchange Commission (the "SEC"), and corporate governance documents.

The SEC public filings available for review include but are not limited to:

o  
its Annual Report on Form 10-K for the year ended December 31, 2011,
o  
its Proxy Statement on Schedule 14A dated March 30, 2012, and
o  
its Quarterly Report on Form 10-Q for the quarter ended March 31, 2012.

White River’s public filings with the SEC can also be viewed on the SEC’s website at: www.sec.gov.


FORWARD-LOOKING STATEMENTS

This press release contains certain forward-looking information about White River that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. Such information includes forward-looking statements above regarding the future financial performance of Coastal Credit and also White River's prospects for future earnings, earnings volatility and the likelihood of recognizing future value from its deferred tax assets. All statements other than statements of historical fact are forward-looking statements. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of White River. White River cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, implied or projected by, such forward-looking statements. Risks and uncertainties include, but are not limited to:
·  
losses and prepayments on our receivable portfolios;
·  
general economic, market, or business conditions;
·  
changes in interest rates, the cost of funds, and demand for our financial services;
 
 
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· 
changes in our competitive position;
·  
our ability to manage growth and integrate acquired businesses;
·  
the opportunities that may be presented to and pursued by us;
·  
competitive actions by other companies;
·  
changes in laws or regulations;
·  
changes in the policies of federal or state regulators and agencies.

If any of these risks or uncertainties materializes or if any of the assumptions underlying such forward-looking statements proves to be incorrect, White River's results could differ materially from those expressed in, implied or projected by such forward-looking statements. White River assumes no obligation to update such forward-looking statements.

 
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WHITE RIVER CAPITAL, INC. AND SUBSIDIARIES
            
CONDENSED CONSOLIDATED BALANCE SHEETS
            
(Unaudited)
            
(Dollars in thousands)
            
             
ASSETS
  
June 30, 2012
    
December 31, 2011
  
             
Cash and cash equivalents
   $ 1,599     $ 3,244  
Finance receivables—net
     122,599       114,716  
Deferred tax assets—net
     34,445       36,489  
Other assets
     769       861  
                 
TOTAL
   $ 159,412     $ 155,310  
                 
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY
                
                 
LIABILITIES:
                
Line of credit
   $ 83,000     $ 81,000  
Accrued interest
     201       183  
Other payables and accrued expenses
     1,704       2,398  
                 
Total liabilities
     84,905       83,581  
                 
COMMITMENTS AND CONTINGENCIES
                
                 
SHAREHOLDERS’ EQUITY:
                
Preferred Stock, without par value, authorized
                
3,000,000 shares; none issued and outstanding
     -       -  
Common Stock, without par value, authorized
                
20,000,000 shares; 3,544,825 and 3,534,480
                
issued and outstanding at June 30, 2012
                
and December 31, 2011, respectively
     174,543       174,328  
Accumulated deficit
     (100,036 )     (102,599 )
                 
Total shareholders’ equity
     74,507       71,729  
                 
TOTAL
   $ 159,412     $ 155,310  
 
 
 
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WHITE RIVER CAPITAL, INC. AND SUBSIDIARIES
            
Book Value per Share and Equity Ratios
            
(Unaudited)
            
(Dollars in thousands except per share amounts and percentages)
        
             
   
June 30,
    
December 31,
  
   
2012
    
2011
  
             
Total shareholders’ equity
   $ 74,507     $ 71,729  
Assets
   $ 159,412     $ 155,310  
Shares outstanding
     3,544,825       3,534,480  
                 
Book value per share
   $ 21.02     $ 20.29  
Equity/ assets
     46.7 %     46.2 %

 
 
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WHITE RIVER CAPITAL, INC. AND SUBSIDIARIES
                    
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    
(Unaudited)
                        
(Dollars in thousands except per share amounts)
                        
                         
   
Quarters Ended June 30,
    
Six Months Ended June 30,
  
   
2012
    
2011
    
2012
    
2011
  
INTEREST:
                        
Interest on receivables
   $ 9,145     $ 8,676     $ 18,219     $ 17,047  
                                 
Interest expense
     (609 )     (446 )     (1,215 )     (914 )
                                 
Net interest margin
     8,536       8,230       17,004       16,133  
                                 
Provision for loan losses
     (1,292 )     (699 )     (2,581 )     (1,755 )
                                 
Net interest margin after provision for loan losses
     7,244       7,531       14,423       14,378  
                                 
OTHER REVENUES (EXPENSES):
                                
Salaries and benefits
     (2,467 )     (2,240 )     (5,055 )     (4,688 )
Other operating expenses
     (1,162 )     (1,248 )     (2,528 )     (2,370 )
Change in fair market valuation of creditor notes payable
     -       -       -       43  
Other expense
     (198 )     (141 )     (302 )     (225 )
                                 
Total other expenses
     (3,827 )     (3,629 )     (7,885 )     (7,240 )
                                 
INCOME BEFORE INCOME TAXES
     3,417       3,902       6,538       7,138  
                                 
INCOME TAX EXPENSE
     (1,101 )     (1,365 )     (2,204 )     (2,505 )
                                 
NET INCOME
   $ 2,316     $ 2,537     $ 4,334     $ 4,633  
                                 
NET INCOME PER COMMON SHARE (BASIC)
   $ 0.65     $ 0.70     $ 1.22     $ 1.27  
                                 
NET INCOME PER COMMON SHARE (DILUTED)
   $ 0.65     $ 0.70     $ 1.22     $ 1.27  
                                 
BASIC WEIGHTED AVERAGE NUMBER
                                
OF COMMON SHARES OUTSTANDING
     3,544,825       3,612,880       3,543,299       3,650,953  
                                 
DILUTED WEIGHTED AVERAGE NUMBER
                                
OF COMMON SHARES OUTSTANDING
     3,547,538       3,614,984       3,544,749       3,655,063  


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