Broadway Financial Corporation Announces Revised Net Earnings for First Quarter Ended March 31, 2012
Broadway Financial Corporation Announces Revised Net Earnings for First Quarter Ended March 31, 2012
LOS ANGELES--(BUSINESS WIRE)-- Broadway Financial Corporation (the "Company") (NAS: BYFC) , parent company of Broadway Federal Bank, f.s.b. (the "Bank"), today announced its revised results for the quarter ended March 31, 2012.
Our previously reported results for the quarter have been revised because some of the provisions that we had included in the results for the first quarter of 2012 are now reflected in our restated results for 2011. In addition, the revision to the results for the first quarter of 2012 reflect conclusions regarding our valuation allowances reached by the Office of the Controller of Currency during its recently completed supervisory examination of the Bank.
Based on these changes, we are reporting net earnings of $154,000 for the first quarter of 2012, whereas previously we had reported a loss of $60,000. In contrast, we reported a net loss of $129,000 for the first quarter of 2011. After deducting preferred dividends and related discount accretion on the Series D and E Perpetual Cumulative Preferred Stock held by the U.S. Department of the Treasury, we are now reporting a loss to common stockholders of $132,000, as compared to a previously announced loss of $346,000 for the first quarter of 2012 and a loss of $412,000 for the first quarter of 2011.
A summary of the effects of these corrections on the Company's consolidated balance sheet as of March 31, 2012 and consolidated statement of operations for the quarter then ended is included with this release. More detailed information regarding our financial condition at March 31, 2012 and our results of operations for the three months then ended will be contained in our report on Form 10-Q for the first quarter of 2012 to be filed shortly with the Securities and Exchange Commission.
About Broadway Financial Corporation
Broadway Financial Corporation conducts its operations through its wholly-owned subsidiary, Broadway Federal Bank, f.s.b., which is the leading community-oriented savings bank in Southern California serving low to moderate income communities. We offer a variety of residential and commercial real estate loan products for consumers, businesses, and non-profit organizations, other loan products, and a variety of deposit products, including checking, savings and money market accounts, certificates of deposits and retirement accounts. The Bank operates three full service branches, two in the city of Los Angeles, and one located in the nearby city of Inglewood, California.
Shareholders, analysts and others seeking information about the Company are invited to write to: Broadway Financial Corporation, Investor Relations, 4800 Wilshire Blvd., Los Angeles, CA 90010, or visit our website at www.broadwayfederalbank.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon our management's current expectations, and involve risks and uncertainties. Actual results or performance may differ materially from those suggested, expressed, or implied by the forward-looking statements due to a wide range of factors including, but not limited to, the general business environment, the real estate market, competitive conditions in the business and geographic areas in which the Company conducts its business, regulatory actions or changes and other risks detailed in the Company's reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to publicly revise any forward-looking statement to reflect any future events or circumstances, except to the extent required by law.
BROADWAY FINANCIAL CORPORATION | ||||||||||||||||
AND SUBSIDIARIES | ||||||||||||||||
Consolidated Balance Sheets | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
As Originally Announced | As Revised | As Restated | ||||||||||||||
March 31, | March 31, | December 31, | ||||||||||||||
2012 | Adjustments | 2012 | 2011 | |||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||
ASSETS | ||||||||||||||||
Cash | $ | 13,572 | $ | - | $ | 13,572 | $ | 12,127 | ||||||||
Federal funds sold | 31,605 | - | 31,605 | 19,470 | ||||||||||||
Cash and cash equivalents | 45,177 | - | 45,177 | 31,597 | ||||||||||||
Securities available for sale, at fair value | 18,027 | - | 18,027 | 18,979 | ||||||||||||
Loans receivable held for sale, net | 13,277 | (369 | ) | 12,908 | 12,983 | |||||||||||
Loans receivable, net of allowance of $17,752 and $17,299 | 313,276 | (3,698 | ) | 309,578 | 322,770 | |||||||||||
Accrued interest receivable | 1,601 | - | 1,601 | 1,698 | ||||||||||||
Federal Home Loan Bank (FHLB) stock, at cost | 3,901 | - | 3,901 | 4,089 | ||||||||||||
Office properties and equipment, net | 4,548 | - | 4,548 | 4,626 | ||||||||||||
Real estate owned (REO) | 4,335 | (377 | ) | 3,958 | 6,699 | |||||||||||
Bank owned life insurance | 2,629 | - | 2,629 | 2,609 | ||||||||||||
Investment in affordable housing partnership | 1,629 | - | 1,629 | 1,675 | ||||||||||||
Deferred tax assets | 828 | (56 | ) | 772 | 850 | |||||||||||
Other assets | 4,155 | (23 | ) | 4,132 | 5,162 | |||||||||||
Total assets | $ | 413,383 | $ | (4,523 | ) | $ | 408,860 | $ | 413,737 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||
Deposits | $ | 290,352 | $ | - | $ | 290,352 | $ | 294,686 | ||||||||
Federal Home Loan Bank advances | 83,000 | - | 83,000 | 83,000 | ||||||||||||
Junior subordinated debentures | 6,000 | - | 6,000 | 6,000 | ||||||||||||
Other borrowings | 5,000 | - | 5,000 | 5,000 | ||||||||||||
Advance payments by borrowers for taxes and insurance | 335 | - | 335 | 813 | ||||||||||||
Other liabilities | 5,904 | - | 5,904 | 5,962 | ||||||||||||
Total liabilities | 390,591 | - | 390,591 | 395,461 | ||||||||||||
Stockholders' Equity: | ||||||||||||||||
Senior preferred, cumulative and non-voting stock, $0.01 par value, authorized, issued and outstanding 9,000 shares of Series D at March 31, 2012 and December 31, 2011; liquidation preference of $9,844 at March 31, 2012 and $9,731 at December 31, 2011 | 8,963 | - | 8,963 | 8,963 | ||||||||||||
Senior preferred, cumulative and non-voting stock, $0.01 par value, authorized, issued and outstanding 6,000 shares of Series E at March 31, 2012 and December 31, 2011; liquidation preference of $6,563 at March 31, 2012 and $6,488 at December 31, 2011 | 5,974 | - | 5,974 | 5,974 | ||||||||||||
Preferred, non-cumulative and non-voting stock, $.01 par value, authorized 985,000 shares; issued and outstanding 55,199 shares of Series A, 100,000 shares of Series B and 76,950 shares of Series C at March 31, 2012 and December 31, 2011; liquidation preference of $552 for Series A, $1,000 for Series B and $1,000 for Series C at March 31, 2012 and December 31, 2011 | 3,657 | - | 3,657 | 3,657 | ||||||||||||
Preferred stock discount | (896 | ) | - | (896 | ) | (994 | ) | |||||||||
Common stock, $.01 par value, authorized 8,000,000 shares at March 31, 2012 and December 31, 2011; issued 2,013,942 shares at March 31, 2012 and December 31, 2011; outstanding 1,744,565 shares at March 31, 2012 and December 31, 2011 | 20 | - | 20 | 20 | ||||||||||||
Additional paid-in capital | 10,844 | - | 10,844 | 10,824 | ||||||||||||
Accumulated deficit | (2,904 | ) | (4,523 | ) | (7,427 | ) | (7,295 | ) | ||||||||
Accumulated other comprehensive income, net of taxes of $400 at March 31, 2012 and December 31, 2011 | 578 | - | 578 | 571 | ||||||||||||
Treasury stock-at cost, 269,377 shares at March 31, 2012 and December 31, 2011 | (3,444 | ) | - | (3,444 | ) | (3,444 | ) | |||||||||
Total stockholders' equity | 22,792 | (4,523 | ) | 18,269 | 18,276 | |||||||||||
Total liabilities and stockholders' equity | $ | 413,383 | $ | (4,523 | ) | $ | 408,860 | $ | 413,737 |
BROADWAY FINANCIAL CORPORATION | ||||||||||||||||
AND SUBSIDIARIES | ||||||||||||||||
Consolidated Statements of Operations and Comprehensive Earnings (Loss) | ||||||||||||||||
(Dollars in thousands, except per share amounts) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||
As Originally Announced | As Revised | |||||||||||||||
2012 | Adjustments | 2012 | 2011 | |||||||||||||
Interest and fees on loans receivable | $ | 5,330 | $ | - | $ | 5,330 | $ | 6,384 | ||||||||
Interest on securities | 148 | - | 148 | 181 | ||||||||||||
Other interest income | 16 | - | 16 | 9 | ||||||||||||
Total interest income | 5,494 | - | 5,494 | 6,574 | ||||||||||||
Interest on deposits | 975 | - | 975 | 1,239 | ||||||||||||
Interest on borrowings | 833 | - | 833 | 989 | ||||||||||||
Total interest expense | 1,808 | - | 1,808 | 2,228 | ||||||||||||
Net interest income before provision for loan losses | 3,686 | - | 3,686 | 4,346 | ||||||||||||
Provision for loan losses | 427 | 532 | 959 | 1,240 | ||||||||||||
Net interest income after provision for loan losses | 3,259 | (532 | ) | 2,727 | 3,106 | |||||||||||
Non-interest income: | ||||||||||||||||
Service charges | 153 | - | 153 | 182 | ||||||||||||
Net losses on mortgage banking activities | (166 | ) | - | (166 | ) | (25 | ) | |||||||||
Net gains (losses) on sales of REO | 272 | 140 | 412 | (15 | ) | |||||||||||
Other | 24 | - | 24 | 39 | ||||||||||||
Total non-interest income | 283 | 140 | 423 | 181 | ||||||||||||
Non-interest expense: | ||||||||||||||||
Compensation and benefits | 1,589 | - | 1,589 | 1,809 | ||||||||||||
Occupancy expense, net | 287 | - | 287 | 354 | ||||||||||||
Information services | 213 | - | 213 | 227 | ||||||||||||
Professional services | 108 | - | 108 | 168 | ||||||||||||
Provision for losses on loans held for sale | 503 | (505 | ) | (2 | ) | 20 | ||||||||||
Provision for losses on REO | 160 | (179 | ) | (19 | ) | 80 | ||||||||||
FDIC insurance | 217 | - | 217 | 283 | ||||||||||||
Office services and supplies | 109 | - | 109 | 142 | ||||||||||||
Other | 419 | - | 419 | 419 | ||||||||||||
Total non-interest expense | 3,605 | (684 | ) | 2,921 | 3,502 | |||||||||||
Earnings (loss) before income taxes | (63 | ) | 292 | 229 | (215 | ) | ||||||||||
Income tax expense (benefit) | (3 | ) | 78 | 75 |