|Happy Days Are Here Again
New Century ups fourth quarter expectations
October 3, 2002
By CHRISTY ROBINSON
|New Century Financial Corporation announced Friday that strong production and a robust secondary market are enabling the company to raise its expected fourth quarter earnings.
The specialty mortgage banking company projects the fourth quarter’s earnings per share (EPS) to be better than or equal to the third quarter’s forecasted EPS.
Because of this elevated fourth-quarter forecast, New Century is raising its annual EPS guidance for fiscal year 2002 to $6.75 to $6.85 a share, up from its earlier projection of $6.35 to $6.55 a share, the announcement said.
It also reaffirmed that it is on track to delivering approximately $1.95 per share in the third quarter.
“Our production remains very strong, the secondary market remains robust and our production is sold through October in committed forward sales,” said Robert K. Cole, chairman and chief executive officer. “Consequently, we expect favorable financial results for the balance of 2002.”
He added that the company is on its way to achieving record earnings for 2002.
“Our residual assets are free and clear of long-term debt with all the cash flow now coming to New Century,” he said. “In addition, our liquidity and capital position is the strongest it’s ever been in the history of the company.”
The company also reported that its board of directors has approved a quarterly cash dividend of a nickel a share to New Century’s common stockholders, to be paid on Oct. 29 for shareholders of record on Oct. 15, according to the company’s Web site.
The company reported loan production for the second quarter at approximately $3.2 billion, setting a new quarterly volume record, according to a prior announcement. Its net earnings were a record $42.9 million, or $1.64 a share on a diluted basis. During last year’s second quarter, the company’s net earnings were $9.9 million, or $0.51 a share.
The company had reported in early April that it expected its fiscal 2002 earnings would range from $4.15 to $4.35 a share compared with earlier estimates of $3.90 to $4.10 a share, and that it expected its first quarter 2002 results to meet analysts’ estimate.
Later that month, the company reported record EPS of $1.21, record net profit of $30.9 million, and record production of $2.7 billion for the quarter ending March 31.
As of Wednesday afternoon, New Century shares were trading up $0.03 at $24.90, according to the Wall Street Journal. The stock traded as low as $9.59 per share last December.
Christy Robinson is the editor of MortgageDaily.com. She received a bachelor’s degree in news-editorial journalism from The University of Texas at Arlington. Her work has previously been published in The Dallas Morning News.
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