Friday, November 03, 2006

new century warns again

kann die anzahl der warnungen nicht mehr zählen. aber diese zahlen sind ein neuer tiefpunkt und zeigen deutlich das der markt echte probleme hat

i haven given up to count the warnings from management. but these datapoints shows really how bad the market is.
Declared fourth quarter dividend of $1.90 per share (isn´t it funny that the divident is not nearly covered by the profit..../die dievidende nicht mal im ansatz durch den gewinn gedeckt)

"REIT taxable income(1) per share was $0.84".

Earnings-per-share (EPS) was $1.12 (minus 45%)

negatively impacting our EPS was a $0.75 per share reduction from marking-to-market our derivatives not qualifying for hedge accounting treatment ( call it writedown/nennt es doch einfach abschriebung)

Excluding the hedging-related accounting charges, our operating results were solid.
(can you believe this. excluding every neagitve impact like costs of doing business our results are great......
earnings ex expanses............/ nicht zu fassen. rechne so lange alle negativen kosten und faktoren raus bis man irgendwann zu einem guten ergebnis kommt.)

Return-on-assets (ROA) on the REIT portfolio declined to 0.68 percent in the third quarter of 2006 from 1.49 percent in the second quarter of 2006

The company's 60-day-plus delinquency rate as of September 30, 2006 was 5.95 percent compared with 4.61 percent in the second quarter of 2006.(big jump q/q)

first payment defaults (fpd) 2,03% vs 1,86 on quarter

loan repurchases double 1,18% vs 0,61% y/y (almost all relatet to fpd)

higher due dilligence in the mbs market (finally.../ endlich...)!

The company recently announced its adoption of additional lending best practices. These guidelines include improved underwriting guidelines for its adjustable-rate and interest-only mortgage loan programs for potential borrowers in owner-occupied properties who have FICO scores below 580 and loan-to-value ratios greater than 80 percent. The company is requiring these borrowers to qualify with a debt-to-income ratio that is less than 50 percent and uses the fully-indexed rate minus 100 basis points rather than qualifying at the initial interest rate. Less than 4 percent of the company's recent loan production volume would not have qualified for a 30-year adjustable-rate or interest-only loan under these guidelines (full indexed calculation only on this tiny part of borrowers!, for all the other borrowers no calculations on a fully indexed rate were done !), (overview insidersales)

The company repurchased 992,500 shares of its common stock during the third quarter of 2006 at an average price of $41.66 per share for an aggregate amount of $41.4 million. Since the inception of the stock repurchase program in November 2005, the company has purchased an aggregate of 2.4 million shares of its common stock in the open market, at an average price of $39.60 per share (today 38$, round about 25% of the shares that new bought back were sold at the same time from insiders)

company is authorized to repurchase over the next 12 months 5 million shares, which represents approximately 9 percent of the company's outstanding common stock as of October 31, 2006.

During the third quarter of 2006, the company issued 2.3 million shares of its 9.75 percent Series B Cumulative Redeemable Preferred Stock at $25 per share and also completed a $50 million private placement of trust preferred securities (thats the new mantra, borrow to buy back stock...../die neue realität. verschulden um aktienzurückzukaufen.....)

round about 5% off the portfolio are secound lines

and now the killer:!!!!

the company sold $410.0 million of non-prime mortgage loans during the third quarter of 2006 at an average discount of 12.9 percent of their outstanding principal balances compared with $415.1 million for the second quarter of 2006 at an average discount of 5.0 percent. (this looks like a crash!)

While the total volume of discounted loans sales decreased slightly, the severity of the discount increased due to the inclusion of a higher percentage of non- performing assets in these sales and a lower average price for loans with minor defects. Higher loan repurchases and discounted mortgage loan sales reduced the gain-on-sale margin by 48 basis points.

more details from russ winter

here the link from the conference call presentation


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