MFIN 8-K
Medallion Financial Corp (MFIN)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
(Address of Principal Executive Offices) (Zip Code)
(
(Registrant’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 2.02 Results of Operations and Financial Condition.
Medallion Financial Corp. (the “Company”), issued a press release to the news media announcing, among other things, the Company’s results for the quarter ended September 30, 2023.
A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information in the press release is being furnished, not filed, pursuant to Item 2.02. Accordingly, the information in the press release will not be incorporated by reference into any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
The following exhibits are being filed with this Current Report on Form 8-K:
99.1 |
|
104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: October 30, 2023
MEDALLION FINANCIAL CORP. |
||
|
|
|
By: |
|
/s/ Anthony N. Cutrone |
|
|
Name: Anthony N. Cutrone |
|
|
Title: Chief Financial Officer |
3
FOR IMMEDIATE RELEASE:
MEDALLION FINANCIAL CORP. REPORTS 2023 THIRD QUARTER RESULTS
NEW YORK, NY – October 30, 2023 – Medallion Financial Corp. (NASDAQ: MFIN, “Medallion” or the “Company”), a specialty finance company that originates and services loans in various consumer and commercial industries, along with offering loan origination services to fintech strategic partners, announced today its results for the quarter ended September 30, 2023.
2023 Third Quarter Highlights
Executive Commentary – Andrew Murstein, President of Medallion
“We continue to be pleased with our strong results. Our earnings of nearly $41 million for the first nine months of the year were up 32% compared to last year. This is our highest net income for the nine-months through September since we went public. Net interest income grew 16% over the prior year quarter and grew 4% from the second quarter.
With over $200 million of consumer loans originated during the quarter, we continued to increase market share while taking pro-active steps to increase credit standards, increase pricing, and moderate growth to a level sustainable with our long-term strategy. Cash collections related to our taxi medallion assets were $5.7 million, adding $0.10 to our bottom line. In October, we collected an additional $9.4 million from one of larger taxi medallion borrowers, which will result in a pre-tax gain of $8.0 million in the fourth quarter.
Our board of directors has authorized a 25% increase of our quarterly dividend to $0.10 per share beginning with the upcoming dividend payment next month, another sign of our commitment to providing sustainable shareholder value over the long-term.”
Business Segment Highlights
Recreation Lending Segment
Home Improvement Lending Segment
Commercial Lending Segment
Medallion Lending Segment
Capital Allocation
Quarterly Dividend
Conference Call Information
The Company will host a conference call to discuss its third quarter financial results tomorrow, Tuesday, October 31, 2023, at 9:00 a.m. Eastern time.
In connection with its earnings release, the Company has updated its quarterly supplement presentation, which is now available at www.medallion.com.
How to Participate
A link to the live audio webcast of the conference call will also be available at the Company’s IR website.
Replay Information
The webcast replay will be available at the Company's IR website until the next quarter’s results are announced.
The conference call replay will be available following the end of the call through Tuesday, November 7.
About Medallion Financial Corp.
Medallion Financial Corp. (NASDAQ:MFIN) and its subsidiaries originate and service a growing portfolio of consumer loans and mezzanine loans in various industries. Key industries served include recreation (towable RVs and marine) and home improvement (replacement roofs, swimming pools, and windows). Medallion Financial Corp. is headquartered in New York City, NY, and its largest subsidiary, Medallion Bank, is headquartered in Salt Lake City, Utah. For more information, please visit www.medallion.com.
2
Forward-Looking Statements
Please note that this press release contains forward-looking statements that involve risks and uncertainties relating to business performance, cash flow, net interest income and expenses, other expenses, earnings, growth, and our growth strategy. These statements are often, but not always, made using words or phrases such as “will” and “continue” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These statements relate to future public announcements of our earnings, the impact of the pending SEC litigation, expectations regarding our loan portfolio, including collections on our medallion loans, the potential for future asset growth, and market share opportunities. Medallion’s actual results may differ significantly from the results discussed in such forward-looking statements. For example, statements about the effects of the current economy, whether inflation or the risk of recession, operations, financial performance and prospects constitute forward-looking statements and are subject to the risk that the actual impacts may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond Medallion’s control. In addition to risks relating to the current economy, a description of certain risks to which Medallion is or may be subject, including risks related to the pending SEC litigation, please refer to the factors discussed under the heading “Risk Factors” in Medallion’s 2022 Annual Report on Form 10-K.
Company Contact:
Investor Relations
212-328-2176
3
MEDALLION FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(Dollars in thousands, except share and per share data) |
|
September 30, 2023 |
|
|
December 31, 2022 |
|
|
September 30, 2022 |
|
|||
Assets |
|
|
|
|
|
|
|
|
|
|||
Cash, cash equivalents, and federal funds sold |
|
$ |
127,642 |
|
|
$ |
105,598 |
|
|
$ |
98,202 |
|
Investment and equity securities |
|
|
63,717 |
|
|
|
58,785 |
|
|
|
59,024 |
|
Loans |
|
|
2,203,038 |
|
|
|
1,916,953 |
|
|
|
1,855,510 |
|
Allowance for credit losses |
|
|
(79,133 |
) |
|
|
(63,845 |
) |
|
|
(61,535 |
) |
Net loans receivable |
|
|
2,123,905 |
|
|
|
1,853,108 |
|
|
|
1,793,975 |
|
Goodwill and intangible assets, net |
|
|
171,755 |
|
|
|
172,838 |
|
|
|
173,200 |
|
Loan collateral in process of foreclosure |
|
|
15,923 |
|
|
|
21,819 |
|
|
|
24,331 |
|
Other assets |
|
|
55,685 |
|
|
|
47,731 |
|
|
|
50,809 |
|
Total assets |
|
$ |
2,558,627 |
|
|
$ |
2,259,879 |
|
|
$ |
2,199,541 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
|||
Deposits |
|
$ |
1,855,096 |
|
|
$ |
1,607,110 |
|
|
$ |
1,555,832 |
|
Long-term debt |
|
|
218,137 |
|
|
|
214,320 |
|
|
|
219,448 |
|
Short-term borrowings |
|
|
18,489 |
|
|
|
5,000 |
|
|
|
— |
|
Deferred tax liabilities, net |
|
|
23,131 |
|
|
|
26,753 |
|
|
|
26,132 |
|
Operating lease liabilities |
|
|
7,075 |
|
|
|
8,408 |
|
|
|
8,580 |
|
Accounts payable and accrued expenses |
|
|
39,437 |
|
|
|
27,764 |
|
|
|
29,660 |
|
Total liabilities |
|
|
2,161,365 |
|
|
|
1,889,355 |
|
|
|
1,839,652 |
|
Total stockholders’ equity |
|
|
328,474 |
|
|
|
301,736 |
|
|
|
291,101 |
|
Non-controlling interest in consolidated subsidiaries |
|
|
68,788 |
|
|
|
68,788 |
|
|
|
68,788 |
|
Total equity |
|
|
397,262 |
|
|
|
370,524 |
|
|
|
359,889 |
|
Total liabilities and equity |
|
$ |
2,558,627 |
|
|
$ |
2,259,879 |
|
|
$ |
2,199,541 |
|
Number of shares outstanding |
|
|
23,363,731 |
|
|
|
23,061,673 |
|
|
|
23,185,070 |
|
Book value per share |
|
$ |
14.06 |
|
|
$ |
13.08 |
|
|
$ |
12.56 |
|
4
MEDALLION FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
(Dollars in thousands, except share and per share data) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
||||
Total interest income |
|
$ |
65,886 |
|
|
$ |
51,694 |
|
|
$ |
183,455 |
|
|
$ |
142,108 |
|
Total interest expense |
|
|
17,102 |
|
|
|
9,654 |
|
|
|
44,379 |
|
|
|
25,258 |
|
Net interest income |
|
|
48,784 |
|
|
|
42,040 |
|
|
|
139,076 |
|
|
|
116,850 |
|
Provision for credit losses |
|
|
14,532 |
|
|
|
10,047 |
|
|
|
27,045 |
|
|
|
21,046 |
|
Net interest income after provision for credit losses |
|
|
34,252 |
|
|
|
31,993 |
|
|
|
112,031 |
|
|
|
95,804 |
|
Other income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gain on sale of loans and medallion |
|
|
1,417 |
|
|
|
518 |
|
|
|
4,578 |
|
|
|
5,061 |
|
Gain (loss) on equity investments |
|
|
2,180 |
|
|
|
(1,123 |
) |
|
|
2,189 |
|
|
|
2,985 |
|
Write-down of loan collateral in process of foreclosure |
|
|
(30 |
) |
|
|
(94 |
) |
|
|
(303 |
) |
|
|
(608 |
) |
Other income, net |
|
|
739 |
|
|
|
468 |
|
|
|
1,868 |
|
|
|
1,217 |
|
Total other income (loss), net |
|
|
4,306 |
|
|
|
(231 |
) |
|
|
8,332 |
|
|
|
8,655 |
|
Other expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Salaries and employee benefits |
|
|
9,630 |
|
|
|
8,411 |
|
|
|
27,805 |
|
|
|
23,709 |
|
Loan servicing fees |
|
|
2,501 |
|
|
|
2,159 |
|
|
|
7,084 |
|
|
|
6,231 |
|
Collection costs |
|
|
1,583 |
|
|
|
1,593 |
|
|
|
4,729 |
|
|
|
3,935 |
|
Professional fees |
|
|
1,148 |
|
|
|
3,722 |
|
|
|
4,223 |
|
|
|
12,106 |
|
Other expenses |
|
|
4,227 |
|
|
|
3,524 |
|
|
|
12,643 |
|
|
|
10,274 |
|
Total other expenses |
|
|
19,089 |
|
|
|
19,409 |
|
|
|
56,484 |
|
|
|
56,255 |
|
Income before income taxes |
|
|
19,469 |
|
|
|
12,353 |
|
|
|
63,879 |
|
|
|
48,204 |
|
Income tax provision |
|
|
6,727 |
|
|
|
3,205 |
|
|
|
18,582 |
|
|
|
12,892 |
|
Net income after taxes |
|
|
12,742 |
|
|
|
9,148 |
|
|
|
45,297 |
|
|
|
35,312 |
|
Less: income attributable to the non-controlling interest |
|
|
1,512 |
|
|
|
1,512 |
|
|
|
4,536 |
|
|
|
4,535 |
|
Total net income attributable to Medallion Financial Corp. |
|
$ |
11,230 |
|
|
$ |
7,636 |
|
|
$ |
40,761 |
|
|
$ |
30,777 |
|
Basic net income per share |
|
$ |
0.50 |
|
|
$ |
0.33 |
|
|
$ |
1.81 |
|
|
$ |
1.28 |
|
Diluted net income per share |
|
$ |
0.48 |
|
|
$ |
0.32 |
|
|
$ |
1.77 |
|
|
$ |
1.26 |
|
Weighted average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
22,596,982 |
|
|
|
23,154,775 |
|
|
|
22,469,968 |
|
|
|
24,020,058 |
|
Diluted |
|
|
23,392,901 |
|
|
|
23,510,645 |
|
|
|
23,067,944 |
|
|
|
24,332,776 |
|
Dividends declared per common share |
|
$ |
0.08 |
|
|
$ |
0.08 |
|
|
$ |
0.24 |
|
|
$ |
0.24 |
|
5