Manhattan Bridge Capital, Inc. Reports Results for 2020
GREAT NECK, N.Y., March 11, 2021 (GLOBE NEWSWIRE) -- Manhattan Bridge Capital, Inc. (NASDAQ: LOAN) announced today that net income for the year ended December 31, 2020 was approximately $4,229,000, or $0.44 per share (based on approximately 9.6 million weighted-average outstanding common shares), versus approximately $4,495,000, or $0.47 per share (based on approximately 9.7 million weighted-average outstanding common shares) for the year ended December 31, 2019, a decrease of $266,000, or 5.9%. This decrease is primarily attributable to a decrease in revenue, partially offset by a decrease in interest expense.
Total revenue for the year ended December 31, 2020 was approximately $7,006,000 compared to approximately $7,340,000 for the year ended December 31, 2019, a decrease of $334,000, or 4.6%. The decrease in revenue was primarily attributable to lower interest rates and origination fees charged on loans due to market conditions and intense competition from other lenders, as well as lower demand for new loans resulting from the COVID-19 pandemic. In 2020, approximately $5,989,000 of our revenue represents interest income on secured, real estate loans that we offer to small businesses compared to approximately $6,186,000 in 2019, and approximately $1,018,000 represents origination fees on such loans, compared to approximately $1,154,000 in 2019. The loans are principally secured by collateral consisting of real estate and, generally, accompanied by personal guarantees from the principals of the borrowers.
Total operating costs and expenses for the year ended December 31, 2020 were approximately $2,796,000 compared to approximately $2,842,000 for the year ended December 31, 2019, a decrease of $46,000 or 1.6%. The decrease in operating costs and expenses is primarily attributable to decreased interest expense due to lower LIBOR rates and decreases in travel expense, advertising fees and appraisal fees, offset by increases in payroll expenses and compensation to members of our board of directors, as well as an annual bonus paid to officers in 2020 and a voluntary waiver from the Company’s CEO forgoing his base salary for the months of November and December 2019.
As of December 31, 2020, total shareholders' equity was approximately $31,964,000 compared to approximately $31,943,000 as of December 31, 2019.
Assaf Ran, Chairman of the Board and CEO, stated, “I’m pleased that we have managed to continue our track record of zero defaults since inception through another major crisis. During March and April of 2020, the marketplace experienced panic and hysteria. Yet, we kept our portfolio under control, we paid dividends on a regular schedule and we instituted another stock buy-back program. I believe that our performance during the challenges related to COVID-19 during 2020 demonstrates responsible underwriting, lower risk versus many of our peers and management’s commitment to provide shareholder value even in rough times,” added Mr. Ran.
About Manhattan Bridge Capital, Inc.
Manhattan Bridge Capital, Inc. offers short-term secured, non–banking loans (sometimes referred to as ‘‘hard money’’ loans) to real estate investors to fund their acquisition, renovation, rehabilitation or improvement of properties located in the New York metropolitan area, including New Jersey and Connecticut, and in Florida. We operate the website: https://www.manhattanbridgecapital.com.
Forward Looking Statements
This press release and the statements of our representatives related thereto contain or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as “plan,” “project,” “potential,” “seek,” “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or “continue” are intended to identify forward-looking statements. For example, when we discuss our underwriting, lower risk and shareholder value, we are using forward-looking statements. Readers are cautioned that certain important factors may affect the Company’s actual results and could cause such results to differ materially from any forward-looking statements that may be made in this news release. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those projected, expressed or implied in the forward-looking statements as a result of various factors, including but not limited to the following: (i) our loan origination activities, revenues and profits are limited by available funds; (ii) we operate in a highly competitive market and competition may limit our ability to originate loans with favorable interest rates; (iii) our Chief Executive Officer is critical to our business and our future success may depend on our ability to retain him; (iv) if we overestimate the yields on our loans or incorrectly value the collateral securing the loan, we may experience losses; (v) we may be subject to “lender liability” claims; (vi) our due diligence may not uncover all of a borrower’s liabilities or other risks to its business; (vii) borrower concentration could lead to significant losses; (viii) we may choose to make distributions in our own stock, in which case you may be required to pay income taxes in excess of the cash dividends you receive and (ix) if the effect of the COVID-19 pandemic on our business is greater than anticipated. The risk factors contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the Securities and Exchange Commission identify important factors that could cause such differences. These forward-looking statements speak only as of the date of this press release, and we caution potential investors not to place undue reliance on such statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2020 AND 2019
| Assets | 2020 | 2019 | |||||
| Loans receivable | $ | 58,097,970 | $ | 53,485,014 | |||
| Interest receivable on loans | 827,236 | 675,996 | |||||
| Cash | 131,654 | 118,407 | |||||
| Cash - restricted | 327,483 | --- | |||||
| Other assets | 66,566 | 53,218 | |||||
| Operating lease right-of-use asset, net | 369,699 | 87,754 | |||||
| Deferred financing costs, net | 22,807 | 22,637 | |||||
| Total assets | $ | 59,843,415 | $ | 54,443,026 |
Liabilities and Stockholders’ Equity
| Liabilities: | |||||||
| Line of credit | $ | 20,308,873 | $ | 15,232,993 | |||
| Senior secured notes (net of deferred financing costs of $397,327 and $472,413, respectively) | 5,602,673 | 5,527,587 | |||||
| Deferred origination fees | 367,638 | 322,119 | |||||
| Accounts payable and accrued expenses | 168,940 | 151,823 | |||||
| Operating lease liability | 372,907 | 91,025 | |||||
| Other liabilities | --- | 15,000 | |||||
| Dividends payable | 1,058,194 | 1,159,061 | |||||
| Total liabilities | 27,879,225 | 22,499,608 | |||||
| Commitments and contingencies | |||||||
| Stockholders’ equity: | |||||||
| Preferred shares - $.01 par value; 5,000,000 shares authorized; none issued | --- | --- | |||||
| Common shares - $.001 par value; 25,000,000 shares authorized; 9,882,058 issued; 9,619,945 and 9,658,844 outstanding, respectively | 9,882 | 9,882 | |||||
| Additional paid-in capital | 33,157,096 | 33,144,032 | |||||
| Treasury stock, at cost – 262,113 and 223,214 shares | (798,939 | ) | (619,688 | ) | |||
| Accumulated deficit | (403,849 | ) | (590,808 | ) | |||
| Total stockholders’ equity | 31,964,190 | 31,943,418 | |||||
| Total liabilities and stockholders’ equity | $ | 59,843,415 | $ | 54,443,026 | |||
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
| 2020 | 2019 | ||||||
| Interest income from loans | $ | 5,988,622 | $ | 6,185,764 | |||
| Origination fees | 1,017,729 | 1,153,941 | |||||
| Total Revenue | 7,006,351 | 7,339,705 | |||||
| Operating costs and expenses: | |||||||
| Interest and amortization of deferred financing costs | 1,356,015 | 1,635,134 | |||||
| Referral fees | 5,875 | 3,750 | |||||
| General and administrative expenses | 1,434,438 | 1,202,739 | |||||
| Total operating costs and expenses | 2,796,328 | 2,841,623 | |||||
| Income from operations | 4,210,023 | 4,498,082 | |||||
| Other income | 20,000 | 12,000 | |||||
| Loss on write-off of investment in privately held company | --- | (15,000 | ) | ||||
| Income before income tax expense | 4,230,023 | 4,495,082 | |||||
| Income tax expense | (645 | ) | (572 | ) | |||
| Net income | $ | 4,229,378 | $ | 4,494,510 | |||
| Basic and diluted net income per common share outstanding: | |||||||
| --Basic | $ | 0.44 | $ | 0.47 | |||
| --Diluted | $ | 0.44 | $ | 0.47 | |||
| Weighted average number of common shares outstanding | |||||||
| --Basic | 9,631,296 | 9,658,147 | |||||
| --Diluted | 9,631,296 | 9,659,285 | |||||
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
| Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Totals | |||||||||||
| Shares | Amount | Shares | Cost | ||||||||||||
| Balance, January 1, 2019 | 9,874,191 | $ | 9,874 | $ | 33,110,536 | 218,214 | $ | (590,234 | ) | $ | (448,801 | ) | $ | 32,081,375 | |
| Exercise of warrants and options | 7,867 | 8 | 20,432 | 20,440 | |||||||||||
| Non cash compensation | 13,064 | 13,064 | |||||||||||||
| Purchase of treasury shares | 5,000 | (29,454 | ) | (29,454 | ) | ||||||||||
| Dividends paid | (3,477,456 | ) | (3,477,456 | ) | |||||||||||
| Dividends declared and payable | (1,159,061 | ) | (1,159,061 | ) | |||||||||||
| Net income for the year ended December 31, 2019 | 4,494,510 | 4,494,510 | |||||||||||||
| Balance, December 31, 2019 | 9,882,058 | $ | 9,882 | 33,144,032 | 223,214 | (619,688 | ) | (590,808 | ) | 31,943,418 | |||||
| Non cash compensation | 13,064 | 13,064 | |||||||||||||
| Purchase of treasury shares | 38,899 | (179,251 | ) | (179,251 | ) | ||||||||||
| Dividends paid | (2,984,225 | ) | (2,984,225 | ) | |||||||||||
| Dividends declared and payable | (1,058,194 | ) | (1,058,194 | ) | |||||||||||
| Net income for the year ended December 31, 2020 | 4,229,378 | 4,229,378 | |||||||||||||
| Balance, December 31, 2020 | 9,882,058 | $ | 9,882 | $ | 33,157,096 | 262,113 | $ | (798,939 | ) | $ | (403,849 | ) | $ | 31,964,190 | |
MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019
| 2020 | 2019 | ||||||
| Cash flows from operating activities: | |||||||
| Net income | $ | 4,229,378 | $ | 4,494,510 | |||
| Adjustments to reconcile net income to net cash provided by operating activities - | |||||||
| Amortization of deferred financing costs | 102,017 | 94,489 | |||||
| Depreciation | 1,135 | 1,414 | |||||
| Non cash compensation expense | 13,064 | 13,064 | |||||
| Loss on write-off of investment in privately held company | --- | 15,000 | |||||
| Adjustment to operating lease right-of-use asset and liability | (62 | ) | 3,271 | ||||
| Changes in operating assets and liabilities | |||||||
| Interest receivable on loans | (180,911 | ) | (79,219 | ) | |||
| Other assets | (5,724 | ) | 3,499 | ||||
| Accounts payable and accrued expenses | 17,117 | (31,893 | ) | ||||
| Deferred origination fees | 45,519 | (82,557 | ) | ||||
| Net cash provided by operating activities | 4,221,533 | 4,431,578 | |||||
| Cash flows from investing activities: | |||||||
| Issuance of short term loans | (43,719,304 | ) | (48,053,965 | ) | |||
| Collections received from loans | 39,136,019 | 49,420,078 | |||||
| Release of loan holdback relating to mortgage receivable | (15,000 | ) | --- | ||||
| Purchase of fixed assets | (8,759 | ) | --- | ||||
| Net cash (used in) provided by investing activities | (4,607,044 | ) | 1,366,113 | ||||
| Cash flows from financing activities: | |||||||
| Proceeds from (repayments of) line of credit, net | 5,075,880 | (1,389,154 | ) | ||||
| Dividends paid | (4,143,286 | ) | (4,636,173 | ) | |||
| Purchase of treasury shares | (179,251 | ) | (29,454 | ) | |||
| Deferred financing costs incurred | (27,102 | ) | --- | ||||
| Proceeds from exercise of stock options and warrants | --- | 20,440 | |||||
| Net cash provided by (used in) financing activities | 726,241 | (6,034,341 | ) | ||||
| Net increase (decrease) in cash and restricted cash | 340,730 | (236,650 | ) | ||||
| Cash and restricted cash, beginning of year | 118,407 | 355,057 | |||||
| Cash and restricted cash, end of year | $ | 459,137 | $ | 118,407 | |||
| Supplemental Cash Flow Information: | |||||||
| Taxes paid during the year | $ | 645 | $ | 572 | |||
| Interest paid during the year | $ | 1,264,533 | $ | 1,560,644 | |||
| Operating leases paid during the year | $ | 56,572 | $ | 52,571 | |||
| Supplemental Information – Noncash Information: Dividend declared and payable | $ | 1,058,194 | $ | 1,159,061 | |||
| Establishment of right-of-use asset and operating lease liability | $ | 329,421 | $ | 135,270 | |||
| Interest receivable converted to loans receivable in connection with forbearance agreements | $ | 29,671 | $ | --- | |||
| Loan holdback relating to mortgage receivable | $ | --- | $ | 15,000 | |||
CONTACT: Contact: Assaf Ran, CEO Vanessa Kao, CFO (516) 444-3400 SOURCE: Manhattan Bridge Capital, Inc.