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Altisource Asset Management Corporation Reports Third Quarter 2019 Results

CHRISTIANSTED, U.S. Virgin Islands, Nov. 06, 2019 (GLOBE NEWSWIRE) -- Altisource Asset Management Corporation (“AAMC” or the “Company”) (NYSE American: AAMC) today announced financial and operating results for the third quarter of 2019.

Third Quarter 2019 Highlights and Recent Developments

  • Increased Front Yard Residential Corporation's (“Front Yard”) rental revenues by 5% to $50.8 million compared to the third quarter of 2018.

  • Managed Front Yard's sale of 126 non-core homes for proceeds of $22.6 million and a $2.1 million gain over carrying value.

  • Negotiated the settlement of the last remaining significant litigation outstanding against Front Yard for $10 million after insurance proceeds.

“During the quarter we made substantial progress in addressing Front Yard's operational challenges arising from the internalization of property management,” stated George Ellison, Chief Executive Officer. “While this impacted Front Yard's results in the third quarter, we are seeing improved metrics in October that we expect will drive stronger results in the fourth quarter.”

Third Quarter 2019 Financial Results

AAMC’s net loss attributable to common stockholders for the third quarter of 2019 was $3.6 million, or $2.25 per diluted common share, which included a $(1.1) million change in the fair value of its shares of Front Yard common stock, compared to a net loss of $1.2 million, or $0.75 per diluted common share, which included a $0.7 million change in the fair value of its shares of Front Yard common stock, for the third quarter of 2018.

AAMC's net loss attributable to common stockholders for the nine months ended September 30, 2019 was $1.2 million, or $0.77 per diluted common share, which included a $4.6 million change in the fair value of its shares of Front Yard common stock, compared to a net loss attributable to common stockholders of $6.7 million, or $4.19 per diluted common share, which included a $(1.6) million change in the fair value of its shares of Front Yard common stock, for the nine months ended September 30, 2018.

About AAMC

AAMC is an asset management company that provides portfolio management and corporate governance services to investment vehicles. Additional information is available at www.altisourceamc.com.

Forward-looking Statements

This press release contains forward-looking statements that involve a number of risks and uncertainties. Those forward-looking statements include all statements that are not historical fact, including statements about management’s beliefs and expectations. Forward-looking statements are based on management’s beliefs as well as assumptions made by and information currently available to management. Because such statements are based on expectations as to future economic performance and are not statements of historical fact, actual results may differ materially from those projected. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to: AAMC’s ability to implement its business plan; AAMC's ability to leverage strategic relationships on an efficient and cost-effective basis; AAMC's and Front Yard's ability to compete; Front Yard’s ability to implement its business plan; general economic and market conditions; governmental regulations, taxes and policies; AAMC's ability to generate adequate and timely sources of liquidity and financing for itself or Front Yard; Front Yard’s ability to sell non-core assets on favorable terms or at all; AAMC's ability to identify and acquire assets for Front Yard’s portfolio; Front Yard’s ability to complete potential transactions in accordance with anticipated terms and on a timely basis or at all; AAMC’s ability to integrate newly acquired rental assets into Front Yard’s portfolio; the ability to effectively manage the performance of Front Yard’s internal property manager at the level and/or the cost that it anticipates; the failure of third party vendors to effectively perform their obligations under their respective agreements with AAMC or Front Yard; the effects of potential redemptions of our Series A Preferred Stock commencing in March 2020, including our ability to pay with funds legally available therefor or renegotiate the terms thereof; our failure to maintain Front Yard’s qualification as a REIT; and other risks and uncertainties detailed in the “Risk Factors” and other sections described from time to time in the Company’s current and future filings with the Securities and Exchange Commission. The foregoing list of factors should not be construed as exhaustive.

The statements made in this press release are current as of the date of this press release only. The Company undertakes no obligation to publicly update or revise any forward-looking statements or any other information contained herein, whether as a result of new information, future events or otherwise.



Altisource Asset Management Corporation
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
(Unaudited)

Three months ended
September 30,

Nine months ended
September 30,

2019

2018

2019

2018

Revenues:

Management fees from Front Yard

$

3,584

$

3,613

$

10,686

$

10,984

Conversion fees from Front Yard

35

29

151

Expense reimbursements from Front Yard

250

286

920

767

Total revenues

3,834

3,934

11,635

11,902

Expenses:

Salaries and employee benefits

4,219

4,605

12,875

13,343

Legal and professional fees

389

474

2,087

1,293

General and administrative

1,099

993

3,018

2,783

Total expenses

5,707

6,072

17,980

17,419

Other income (loss):

Change in fair value of Front Yard common stock

(1,072

)

698

4,597

(1,641

)

Dividend income on Front Yard common stock

244

244

731

731

Other income

63

58

116

150

Total other (loss) income

(765

)

1,000

5,444

(760

)

Loss before income taxes

(2,638

)

(1,138

)

(901

)

(6,277

)

Income tax expense

885

17

173

309

Net loss attributable to stockholders

(3,523

)

(1,155

)

(1,074

)

(6,586

)

Amortization of preferred stock issuance costs

(52

)

(52

)

(155

)

(155

)

Net loss attributable to common stockholders

$

(3,575

)

$

(1,207

)

$

(1,229

)

$

(6,741

)

Loss per share of common stock – basic:

Loss per basic common share

$

(2.25

)

$

(0.75

)

$

(0.77

)

$

(4.19

)

Weighted average common stock outstanding – basic

1,590,739

1,613,413

1,587,448

1,609,932

Loss per share of common stock – diluted:

Loss per diluted common share

$

(2.25

)

$

(0.75

)

$

(0.77

)

$

(4.19

)

Weighted average common stock outstanding – diluted

1,590,739

1,613,413

1,587,448

1,609,932



Altisource Asset Management Corporation
Condensed Consolidated Balance Sheets
(In thousands, except share and per share amounts)

September 30, 2019

December 31, 2018

(unaudited)

Current assets:

Cash and cash equivalents

$

21,558

$

27,171

Short-term investments

955

584

Front Yard common stock, at fair value

18,779

14,182

Receivable from Front Yard

4,168

3,968

Prepaid expenses and other assets

2,010

1,552

Total current assets

47,470

47,457

Non-current assets:

Right-of-use lease assets

4,458

Other non-current assets

1,708

1,910

Total non-current assets

6,166

1,910

Total assets

$

53,636

$

49,367

Current liabilities:

Accrued salaries and employee benefits

$

4,809

$

5,583

Accounts payable and accrued liabilities

1,204

1,188

Short-term lease liabilities

242

Total current liabilities

6,255

6,771

Long-term lease liabilities

4,291

Total liabilities

10,546

6,771

Commitments and contingencies

Redeemable preferred stock:

Preferred stock, $0.01 par value, 250,000 shares issued and outstanding as of September 30, 2019 and December 31, 2018; redemption value $250,000

249,907

249,752

Stockholders' deficit:

Common stock, $0.01 par value, 5,000,000 authorized shares; 2,886,009 and 1,590,739 shares issued and outstanding, respectively, as of September 30, 2019 and 2,862,760 and 1,573,691 shares issued and outstanding, respectively, as of December 31, 2018

29

29

Additional paid-in capital

44,111

42,245

Retained earnings

25,252

26,558

Accumulated other comprehensive loss

(20

)

Treasury stock, at cost, 1,295,270 shares as of September 30, 2019 and 1,289,069 shares as of December 31, 2018

(276,189

)

(275,988

)

Total stockholders' deficit

(206,817

)

(207,156

)

Total liabilities and equity

$

53,636

$

49,367



FOR FURTHER INFORMATION CONTACT:

Investor Relations

T: 1-704-558-3068

E: InvestorRelations@AltisourceAMC.com