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Origen Financial Announces Final Second Quarter 2009 Results

August 14, 2009 | About:

Press Release: Origen Financial Announces Final Second Quarter 2009 Results

SOUTHFIELD, Mich., Aug. 14 /PRNewswire-FirstCall/ -- Origen Financial, Inc. (Pink Sheets: ORGN), a real estate investment trust that manages residual interests in securitized manufactured housing loan portfolios, today announced a net loss of approximately $2.5 million or $0.10 per share, for the quarter ended June 30, 2009, as compared to a net loss of approximately $4.8 million, or $0.19 cents per share, for the second quarter of 2008. For the six months year to date, Origen realized a net loss of approximately $2.0 million, or $0.08 per share, as compared to a net loss of approximately $29.8 million, or $1.17 per share, for the same period in 2008. Origen\'s Board of Directors did not declare a dividend on its common stock for the second quarter of 2009. The second quarter 2009 provision for loan losses was approximately $5.0 million versus approximately $3.3 million for the prior year quarter, an increase of 52 percent. Year to date, the loan loss provision totaled approximately $9.0 million as compared to a provision of approximately $6.4 million for the first six months of 2008, an increase of 41 percent. The aging of Origen\'s static loan portfolio as loans enter the peak years for delinquencies and defaults, as well as overall economic conditions, especially the increased unemployment rate, has increased the level of loan loss reserves needed and has resulted in increased loan loss provisions. As previously reported, the Company ceased originating loans for its own account in March 2008, and pursuant to the execution of the Asset Management and Disposition Plan ("the Plan") as approved by Origen\'s shareholders in June 2008 and detailed in the Company\'s proxy filing dated May 22, 2008, Origen sold its loan servicing-related assets effective July 1, 2008 and sold its loan origination platform and insurance operations effective July 31, 2008. Origen\'s only remaining business is the management of retained interests in the Company\'s securitized loan portfolios. In December 2008, Origen voluntarily delisted its common stock from the NASDAQ Global Market and also deregistered the stock under the Securities Exchange Act of 1934. Since December 31, 2007, the Company has reduced its workforce by 96 percent and has dramatically reduced the operating and overhead costs associated with on-going operations. Net cash flows from operations and the use of excess liquidity enabled Origen to pay down $2.5 million of principal on related party debt during the quarter. Year to date through June 30, 2009, principal pay downs totaled $4.9 million. Subsequent to quarter end, additional principal payments of $3.6 million were made. Ronald A. Klein, Origen\'s Chief Executive Officer, stated, "While we have been impacted by the nation\'s ongoing increase in job losses, our loan portfolio continues to perform well. Delinquencies 30 days and greater ended July at 2.3 percent which is down from June and lower than December 2008. However, we have experienced increased defaults and lower recovery rates on our California loans due to the almost tripling of the unemployment rate in the state versus a year ago. We are continuing to work with our loan servicer to maximize recovery rates in California and elsewhere." Mr. Klein added, "The market for new manufactured houses continues to decline and the lack of available financing for manufactured housing has negatively impacted prepayment speeds on our loans. Nevertheless, our cash flow continues to be strong and since the end of the first quarter we have repaid an additional $6.1 million of our related party debt." Earnings Call and Webcast A conference call and webcast have been scheduled for Monday, August 17, 2009, at 10:00 a.m. Eastern Time to discuss second quarter results. The call may be accessed by dialing 888-204-4517. A replay will be available through November 17, 2009 by dialing 888-203-1112 passcode 5493522. Forward-Looking Statements This press release contains various "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, and Origen intends that such forward-looking statements will be subject to the safe harbors created thereby. The words "will," "may," "could," "expect," "anticipate," "believes," "intends," "should," "plans," "estimates," "approximate" and similar expressions identify these forward-looking statements. These forward-looking statements reflect Origen\'s current views with respect to future events and financial performance, but involve known and unknown risks and uncertainties, both general and specific to the matters discussed in this press release. These risks and uncertainties may cause Origen\'s actual results to be materially different from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others, the foregoing assumptions and those risks referenced under the headings entitled "Factors That May Affect Future Results" or "Risk Factors" contained in Origen\'s filings with the Securities and Exchange Commission. The forward-looking statements contained in this press release speak only as of the date hereof and Origen expressly disclaims any obligation to provide public updates, revisions or amendments to any forward- looking statements made herein to reflect changes in Origen\'s expectations or future events. About Origen Financial, Inc. Origen is an internally managed and internally advised company that has elected to be taxed as a real estate investment trust. Origen is based in Southfield, Michigan. For more information about Origen, please visit http://www.origenfinancial.com.

Financial Tables Follow...                        ORIGEN FINANCIAL, INC.                      CONSOLIDATED BALANCE SHEETS                        (Dollars in thousands)                                ASSETS                                             (Unaudited)                                               June 30   December 31,                                                 2009         2008                                                 ----         ----    Assets         Cash and Equivalents                  $9,069      $14,118         Restricted Cash                       13,006       12,927         Investment Securities                  9,739        9,739         Loans Receivable                     859,993      911,947         Furniture, Fixtures and Equipment,          Net                                     282          401         Repossessed Houses                     5,988        4,543         Other Assets                           7,905       11,858                                                -----       ------    Total Assets                             $905,982     $965,533                                             ========     ========                 LIABILITIES AND STOCKHOLDERS\' EQUITY    Liabilities         Securitization Financing             730,183      775,120         Note Payable-Related Party            24,619       29,351         Derivative Liabilities                37,432       57,887         Other Liabilities                     17,363       24,980                                               ------       ------    Total Liabilities                         809,597      887,338                                              -------      -------    Equity                                     96,385       78,195                                               ------       ------    Total Liabilities and Equity             $905,982     $965,533                                             ========     ========                             ORIGEN FINANCIAL, INC.                        CONSOLIDATED STATEMENT OF EARNINGS                  (Dollars in thousands, except for share data)                                 (Unaudited)                              Three Months Ended       Six Months Ended                                   June 30,                June 30,                                   --------                --------                                  2009        2008        2009        2008                                  ----        ----        ----        ----    Interest Income       Total Interest Income   $21,042     $20,554     $42,747     $44,425       Total Interest Expense   12,959      16,043      26,047      32,517                                ------      ------      ------      ------    Net Interest Income     Before Loan Losses and     Impairment                  8,083       4,511      16,700      11,908       Provision for Loan        Losses                   4,964       3,342       8,984       6,372       Impairment of        Purchased Loan Pool        212          19         212         267                                   ---          --         ---         ---    Net Interest Income     After Loan Losses and     Impairment                  2,907       1,150       7,504       5,269    Non-interest Income (Loss)       Servicing Income              -         657           -       1,305       Losses on Loans Held        for Sale                     -        (718)          -     (22,377)       Other                       326         941       1,274      (2,395)                                   ---         ---       -----      ------    Total Non-interest     Income (Loss)                 326         880       1,274     (23,467)    Non-interest Expenses       Total Personnel           1,731       5,503       2,846       9,646       Total Loan Origination        & Servicing              2,920         268       5,913         627       State Taxes                  59         104         118         293       Total Other Operating     1,089       1,906       2,005       4,069                                 -----       -----       -----       -----    Total Non-interest     Expenses                    5,799       7,781      10,882      14,635                                 -----       -----      ------      ------    Income (Loss) From     Continuing Operations     Before Income Taxes        (2,566)     (5,751)     (2,104)    (32,833)    Income Tax Expense              19          29          39          62                                    --          --          --          --    Income (Loss) From     Continuing Operations      (2,585)     (5,780)     (2,143)    (32,895)    Income From Discontinued     Operations Net of     Income taxes                  109       1,006         180       3,129                                   ---       -----         ---       -----         Net Income (Loss)     $(2,476)    $(4,774)    $(1,963)   $(29,766)                               =======     =======     =======    ========    Weighted Average     Common Shares     Outstanding, Basic     25,926,149  25,491,187  25,926,149  25,450,530                            ==========  ==========  ==========  ==========    Weighted Average     Common Shares     Outstanding, Diluted   25,926,149  25,491,187  25,926,149  25,450,530                            ==========  ==========  ==========  ==========    Basic Earnings Per     Common Share:       Income (Loss) From        Continuing        Operations              $(0.10)     $(0.23)     $(0.08)     $(1.29)       Income From        Discontinued        Operations                   -        0.04           -        0.12                                     -        ----           -        ----       Net Income (Loss)        $(0.10)     $(0.19)     $(0.08)     $(1.17)                                ======      ======      ======      ======    Notes:    *Prior to July 1, 2008, loan servicing fees were netted out of loan     interest income and recorded as servicing fee income to Origen;     beginning July 1, 2008, loan servicing fees were paid to Green Tree     Servicing and recorded as non-interest expense.    *For explanations of 2008 results of operations see the Company\'s annual     report on Form 10-K and Form 10-K/A for the year ended December 31, 2008     and the Company\'s quarterly report on Form 10-Q for the quarter ended     June 30, 2008.
Source: PRNewsWire

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