View:
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
----------
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):
JULY 30, 2004 (JULY 30, 2004)
ARBOR REALTY TRUST, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Maryland 001-32136 20-0057959
(STATE OR OTHER JURISDICTION (COMMISSION FILE NO.) (I.R.S. EMPLOYER
OF INCORPORATION OR IDENTIFICATION NUMBER)
ORGANIZATION)
333 Earle Ovington Boulevard, Suite 900
Uniondale, New York 11553
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE) (ZIP CODE)
(516) 832-8002
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
N/A
(FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF APPLICABLE)
================================================================================
ITEM 12. RESULTS OF OPERATION AND FINANCIAL CONDITION
On July 30, 2004, Arbor Realty Trust, Inc. (the "Company") issued a press
release announcing its earnings for the quarterly period ended June 30, 2004, a
copy of which is attached hereto as Exhibit 99.1.
The information furnished pursuant to this Current Report on Form 8-K
(including the exhibits hereto) shall not be considered "filed" under the
Securities Exchange Act of 1934, as amended, nor shall it be incorporated by
reference into future filings by the Company under the Securities Act of 1933,
as amended, or under the Securities Exchange Act of 1934, as amended, unless the
Company expressly sets forth in such future filing that such information is to
be considered "filed" or incorporated by reference therein.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ARBOR REALTY TRUST, INC.
By: /s/ Frederick C. Herbst
-----------------------------
Name: Frederick C. Herbst
Title: Chief Financial Officer
Dated: July 30, 2004
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
99.1 Press Release, dated July 30, 2004, of Arbor Realty Trust, Inc.
Exhibit 99.1
Arbor Realty Trust Announces Second Quarter 2004 Results
- Net income of $5.8 million, increase of 86% from 1Q04
- Net income before minority interest of $7.0 million, increase of 63%
from 1Q04
- Net income of $0.39 per basic share; $0.38 per diluted share
- New loan/investment fundings of $214 million
- Total loans/investments of $664 million at end of 2Q04, up 39% from
March 31, 2004
- Declared quarterly dividend of $0.35 per share
UNIONDALE, N.Y., July 30 /PRNewswire-FirstCall/ -- Arbor Realty Trust,
Inc. (NYSE: ABR), a real estate investment trust focused on the business of
investing in real estate related bridge and mezzanine loans, preferred equity
investments, mortgage related securities and other real estate related assets,
today announced financial results for the period ended June 30, 2004. Arbor
reported net income for the quarter ended June 30, 2004 of $5.8 million, or
$0.39 per basic common share and $0.38 per diluted common share. For the six
months ended June 30, 2004, net income totaled $8.9 million, or $0.77 per
basic common share and $0.76 per diluted common share.
Ivan Kaufman, Chairman and Chief Executive Officer, commented, "We are
proud to report our strong financial performance for the second quarter.
Significant progress was made in deploying the funds from the IPO we completed
in April. We originated 18 loans and investments totaling $230.5 million, of
which $213.8 million was funded, a record quarterly origination volume. Our
pipeline remains strong and we continue to see ample opportunity to further
grow the portfolio."
"In addition, we have expanded and diversified our product offerings and
are encouraged by the strong demand for our products. These factors are
expected to contribute to our long-term revenue growth," concluded Mr.
Kaufman.
Total revenues for the quarter ended June 30, 2004 were $11.9 million, an
increase of 46% from the previous quarter, of which $11.5 million was from the
loan and investment portfolio. The balance in the loan and investment
portfolio increased to $664.3 million by quarter end from $477.7 million at
March 31, 2004. The average balance of the loan and investment portfolio was
$584.9 million during the second quarter and the average yield on these assets
was 7.79%.
Interest expense for the quarter was $3.3 million, an increase of 26% from
the previous quarter, of which $3.2 million was from the debt financing of the
loan and investment portfolio. This growth reflects increased leverage during
the quarter. The average balance of debt financing was $300.8 million during
the quarter and the average cost of these borrowings was 4.14%.
In addition, Arbor invested in mortgage-backed securities, which had a
weighted average balance of $55.4 million for the second quarter with an
average yield of 2.95%. These assets were financed by borrowings with a
weighted average balance of $54.4 million with an average cost of 1.18%.
Financing Activity
As previously announced, Arbor completed its initial public offering in
April 2004. Together with a concurrent offering and the exercise of the
underwriter's overallotment option, a total of 7,274,200 shares were sold for
net proceeds of $134 million.
In July 2004, an amendment to one financing facility was completed,
increasing the financing capacity by $100 million. In addition, a separate
$100 million mortgage-backed security facility was added.
Arbor maintains four financing facilities for its loan and investment
portfolio with total capacity of $750 million. Outstanding balances under
these facilities totaled $426 million as of June 30, 2004. The additional
capacity within these facilities, combined with the net proceeds raised in the
IPO, provide ample liquidity to continue to grow the portfolio.
Portfolio Activity
During the second quarter, 18 loans and investments totaling
$230.5 million were originated, of which $213.8 million was disbursed on the
closing date. Of the new loans and investments, four were junior
participation interests totaling $71.5 million, six were mezzanine loans
totaling $69.5 million, four were bridge loans totaling $58.2 million, two
were preferred equity investments totaling $7.4 million, and two were directed
equity investments totaling $7.2 million.
At June 30, 2004, the loan and investment portfolio balance was $664.3
million, with a weighted average current interest pay rate of 7.19%. At the
same date, advances on financing facilities pertaining to the loan and
investment portfolio totaled $374.5 million, with a weighted average funding
cost of 3.53%. These balances constitute an advance rate of approximately 56%
as of June 30, 2004.
The loan and investment portfolio continues to perform according to
expectations and there have been no defaults. Arbor continues to seek loans
and investments that will generate superior risk adjusted returns with a
long-term objective of capital preservation and earnings stability in varying
interest rate and credit cycles.
Dividend
As previously disclosed on July 15, 2004, a dividend of $0.35 per share
was paid for the quarter ended June 30, 2004 to stockholders of record on July
6, 2004.
Earnings Conference Call
Management will host a conference call on Friday, July 30, 2004 at 10:00
a.m. EDT. A live webcast of the conference call will be available online at
http://www.arborrealtytrust.com. Web participants are encouraged to go to
Arbor's Web site at least 15 minutes prior to the start of the call to
register, download and install any necessary audio software. Listening to the
webcast requires speakers and RealPlayer(TM) software, downloadable free at
http://www.real.com. Those without Web access should access the call
telephonically at least ten minutes prior to the conference call. The dial-in
numbers are (866) 761-0749 for domestic callers and (617) 614-2707 for
international callers. The participant passcode for both is 28064177.
After the live webcast, the call will remain available on Arbor's Web
site, http://www.arborrealtytrust.com through August 27, 2004. In addition, a
telephonic replay of the call will be available from July 30, 2004 to August
13, 2004. The replay dial-in number is (888) 286-8010 for domestic callers
and (617) 801-6888. Please use passcode: 28561700.
About Arbor Realty Trust, Inc.
Arbor Realty Trust, Inc. is a real estate investment trust, which invests
in a diversified portfolio of multi-family and commercial real estate related
bridge and mezzanine loans, preferred equity investments, mortgage related
securities and other real estate related assets. Arbor commenced operations in
July 2003 and conducts substantially all of its operations through its
operating partnership, Arbor Realty Limited Partnership. Arbor is externally
managed and advised by Arbor Commercial Mortgage, LLC, a national commercial
real estate finance company operating through 15 offices in the US that
specializes in debt and equity financing for multi-family and commercial real
estate.
Safe Harbor Statement
Certain items in this press release may constitute forward-looking
statements within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These statements are based on
management's current expectations and beliefs and are subject to a number of
trends and uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. Arbor can give no
assurance that its expectations will be attained. Factors that could cause
actual results to differ materially from Arbor's expectations include, but are
not limited to, continued ability to source new investments, changes in
interest rates and/or credit spreads, changes in the real estate markets, and
other risks detailed from time to time in the Arbor's periodic and other
reports filed with the SEC. Such forward-looking statements speak only as of
the date of this press release. Arbor expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any forward-
looking statements contained herein to reflect any change in Arbor's
expectations with regard thereto or change in events, conditions, or
circumstances on which any such statement is based.
Arbor Realty Trust, Inc.
Consolidated Statement of Operations
For the three and six month periods ended June 30, 2004
Three Months Six Months
Ended Ended
June 30, 2004 June 30, 2004
(unaudited) (unaudited)
Revenue
Interest income $11,939,350 $20,102,741
Other income 5,427 26,531
Total revenue 11,944,777 20,129,272
Expenses
Interest expense 3,310,544 5,934,437
Employee compensation and benefits 617,137 1,230,443
Stock-based compensation 92,806 207,007
Selling and administrative 366,843 611,154
Management fee 540,939 834,057
Total expenses 4,928,269 8,817,098
Income before minority interest 7,016,508 11,312,174
Income allocated to minority
interest 1,236,560 2,427,899
Net income $5,779,948 $8,884,275
Weighted average common shares
outstanding
Basic 14,747,949 11,472,833
Diluted 18,465,683 14,929,979
Earnings per common share
Basic $0.39 $0.77
Diluted(1) $0.38 $0.76
(1) Diluted earnings per common share is calculated by dividing income
before minority interest by diluted weighted average common shares
outstanding
Arbor Realty Trust, Inc.
Consolidated Balance Sheets
June 30, 2004 and December 31, 2003
June 30, 2004 December 31, 2003
Assets (unaudited)
Cash $6,166,645 $6,115,525
Loans held for investment, net 637,388,563 286,036,610
Related party loans, net 26,935,784 35,940,881
Available-for-sale securities, at
fair value 54,082,735 -
Investment in equity affiliates 10,439,417 5,917,542
Other assets 8,261,184 4,153,874
Total assets $743,274,328 $338,164,432
Liabilities and stockholders' equity
Notes payable and repurchase
agreements $425,713,693 $172,528,471
Other liabilities 22,780,743 10,888,245
Dividends payable 6,516,355 -
Total liabilities 455,010,791 183,416,716
Minority interest 48,716,537 43,631,602
Stockholders' Equity:
Preferred stock, $0.01 par value:
100,000,000 shares authorized;
3,146,724 shares issued and
outstanding 31,467 31,467
Common stock, $0.01 par value:
500,000,000 shares authorized;
15,471,433 shares issued and
outstanding 154,715 81,996
Additional paid - in capital 241,341,916 112,215,649
Distributions in excess of earnings (338,428) (691,865)
Deferred compensation (279,116) (521,133)
Accumulated other comprehensive loss (1,363,554) -
Total stockholders' equity 239,547,000 111,116,114
Total liabilities and
stockholders' equity $743,274,328 $338,164,432
Contacts: Investors:
Arbor Realty Trust, Inc. Stephanie Carrington/ Denise Roche
Rick Herbst, Chief Financial Officer The Ruth Group
516-832-7408 646-536-7017 / 7008
rick.herbst@thearbornet.com scarrington@theruthgroup.com
droche@theruthgroup.com
Media:
Bonnie Habyan, VP of Marketing
516-229-6615
bonnie.habyan@thearbornet.com
SOURCE Arbor Realty Trust, Inc.
-0- 07/30/2004
/CONTACT: Rick Herbst, Chief Financial Officer, +1-516-832-7408,
rick.herbst@thearbornet.com, or Media, Bonnie Habyan, VP of Marketing,
+1-516-229-6615, bonnie.habyan@thearbornet.com, both of of Arbor Realty Trust,
Inc.; Investors, Stephanie Carrington, +1-646-536-7017,
scarrington@theruthgroup.com, or Denise Roche, +1-646-536-7008,
droche@theruthgroup.com, both of The Ruth Group for Arbor Realty Trust, Inc./
/Web site: http://www.arborrealtytrust.com /
(ABR)
CO: Arbor Realty Trust, Inc.
ST: New York
IN: FIN RLT
SU: CCA ERN