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Kit Menkin’s Leasing News Tuesday, March 26, 2002 www.leasingnews.org Independent, unbiased and fair news about the Leasing Industry -------------------------------------------------------------------------- Headlines---- Fraudulent Employment Resume CORRECTIONS---and CLARIFICATIONS Guaranty Bank Still in Equipment Leasing “Eastern” not “ National” Wells Fargo Bonuses Houston PFSC introduces BackupPlus Steelcase Reports Results for Full Year and Fourth Quarter AGL&F Spring Conference---Baltimore/Municipal Leasing Streamlined Sales Tax Project Conference Call ### Denotes Press Release Fraudulent Employment Resume The individual report in the Bulletin Board Posting appears now to be making the rounds in the San Francisco Bay Area. http://www.leasingnews.org/bulletin_board.htm Regional Sales Manager for Saddleback Financial 11/05/2000 Should you receive a resume from a potential employee from Arizona, to learn more, contact kitmenkin@leasingnews.org CORRECTIONS---and CLARIFICATIONS Guaranty Bank Still in Equipment Leasing “Last week "Leasing News" ran an article stating that Guaranty Capital Corporation, the leasing operations of Guaranty Bank, had "closed its doors." The company has not ceased operations. “Guaranty Capital has moved its leasing operations to the bank's headquarters in Dallas, Texas. But, the leasing company's tax processing and equipment management functions will remain in Boston for the foreseeable future. “Notices of the changes have been sent to all of the company's clients. “Anyone wishing information should contact: Eliot Gilbert Guaranty Capital Corporation 8333 Douglas Dallas, Texas 75225 214-360-2843 Eliot.Gilbert@guarantygroup.com “We would appreciate it if you would include this clarification in your next publication. If you have any questions, please give me a call: Lowell Duncan, 214-520-7550. :Thank you very much.” Lowell Duncan (Telephone calls to you and your staff were not returned. Your voice message definitely gave me the impression the operation had ceased. Brokers had reported you were not longer taking new business. It appears it is more a “portfolio” operation, and if there is more clarification, our readers should we be interested in learning more. Please look at it as a “free plug.” editor) New Tax Law-Eastern Association of Equipment Leasing Association ( we headlined “National” not “Eastern”---sorry ) EAEL is hosting a teleconference April 4 at 12:00PM EST on "Job Creation and Workers' Assistance Act of 2002, and its affect on the Equipment Leasing". Jeffrey Taylor of Executive Caliber, the Presenter, will discuss "What is in the Law and What Didn't Make It", "Details and Implications of Changes in MACRS and Net Operating Losses with Carry-Back Provisions", "How the Law Impacts Pricing; and Lease vs. Buy Analysis" and "How the Law Impacts Estimated Taxes for the First Quarter of 2002". If you need any additional information please contact Alison Pryor at the EAEL, 914-381-5830. Thanks--Alison ---- Wells Fargo 150 Year Celebration As a WF employee, I can confirm that they were stock options (with specific market prices or time periods to determine vesting), not stocks themselves. If people actually did get the shares, I'm sure our parking lot would have some nicer cars in it. Name withheld ( Sorry, our reader had told us otherwise. editor ) --- “When I Get to Houston...” With regard to your note on Houston being a great place to visit and a logical spot for a conference - I agree. For the safety of the attendees, however, I would advise that it be planned for the spring rather than fall. I don't know if you would enjoy the 95+ degree heat and humidity. Christopher Simpson chris@creditleaseonline.com CreditLease, Inc. Houston, TX (Reminded me very much of New Orleans weather. Summer is hot there, too. Most conferences are held in April to May and then October-November. Except for the golf, the activities are inside air-conditioned hotels. In fact, I often wear a jacket or sweater as I find they keep the buildings too cold. Editor ) #### ##########################################33 PFSC introduces BackupPlus - a new standard for backup and successor servicing of asset backed portfolios. Portland, Oregon ...Portfolio Financial Servicing Company (PFSC) announced the launch of a new, standards-setting product for back-up and successor servicing of asset-backed portfolios. Available immediately, BackupPlus provides the most comprehensive, customized services and analysis available for leasing portfolios. PFSC announced that BackupPlus is being provided at the same cost as regular backup servicing for asset-backed securitizations and funding conduits. The new product complements the primary servicer's report by providing additional forecasts, highlights, and PFSC's operational, business, and financial perspectives. According to Mr. Jerry T. Hudspeth, President and CEO of PFSC, "The current level of backup/successor servicing, both passive and "hotsite", is not sufficient to meet the industry's needs. The long-standing practice of accepting data from the primary servicer and either putting it on the shelf or giving it a cursory review or simple conversion and tracking does not match the industry's need for a heightened level of backup servicing, analysis, and review. PFSC believes it is imperative that backup and successor servicers provide a value-added product like BackupPlus to address this need. PFSC has developed the proprietary tools and has the staff experienced in servicing portfolios that allow us to quickly structure a custom program for each portfolio." BackupPlus provides more in-depth, real-time analysis "Lenders, rating agencies and insurers are becoming much more "hands on" with their portfolios," Mr. Hudspeth explained. "Rating agencies and insurers are mostly focused on the stability and predictability of cash flow. In addition, lenders are also requiring much more real-time analysis regarding asset type, demographics, static pools, net cash flows, customer industry trends, vendor concentrations, and residual realization projections. These increased analytical requirements are especially important for the regulated lenders and their internal reserve allocation." Product Overview As Backup or Successor Servicer, PFSC will immediately map and convert all portfolio data and create a portfolio unique environment on the PFSC analytical system. PFSC will then reconcile, test, and benchmark all current portfolio data using the servicer report and the servicer download files. As a result of the initial portfolio analysis, PFSC will generate a portfolio-specific program for analysis and testing of the portfolio data. PFSC will issue monthly backup servicer reports that include both data and narrative. Typical analysis may include: reviews of servicer advances, tax collections, security deposits, write downs, payables, cash reconciliations, transaction and customer risk rating, loss and litigation recovery, residual realization, and trigger events. Analysis may also include detailed information such as demographics, or concentration in equipment types, vendors, asset locations, and customer industries. PFSC can also compare detailed portfolio data month-to-month to monitor changes in contract balances, residual values, new contracts, deleted/paid off contracts, delinquencies, and contract adjustments. PFSC may also sample selected contracts for data quality. About PFSC PFSC is the largest independent commercial lease and loan servicing company in the U.S. and is headquartered in Portland, Oregon. PFSC provides primary/master servicing, backup/successor servicing, and consulting for leasing portfolios. It currently services over $1.5 billion in assets. More information can be found at www.pfsc.com. ### #################################### ################# ##### ############################################# Steelcase Reports Results for Full Year and Fourth Quarter
GRAND RAPIDS, Mich--Steelcase Inc. (NYSE:SCS) today reported that revenue for its fiscal year ended February 22, 2002, totaled $3.1 billion, a decrease of 24 percent compared with $4.0 billion last fiscal year. Excluding acquisitions, revenue decreased 25 percent to $3.0 billion. Lower revenue is the result of the prolonged industry-wide decline in global office furniture demand precipitated by sharply reduced capital spending. Fiscal 2002 reported net income was $1.0 million, or $0.01 per diluted share, compared with $193.7 million or, $1.29 per diluted share in the prior year. Excluding non-recurring charges, net income was $34.7 million, or $0.24 per diluted share, compared with $203.6 million, or $1.36 per diluted share for the same period a year ago. In the past 15 months, without considering acquisitions, workforce reductions worldwide, including actions announced and underway, will total about 6,500 hourly, salaried and temporary positions. The company currently has approximately 19,000 full-time employees. "Our results reflect the difficult economic environment and unprecedented reduction in office furniture spending that our industry has faced throughout the year," said James P. Hackett, president and CEO. "With the actions we've taken to improve our cost structure, adopt lean production systems, and advance our unique product portfolio, we're better positioned to achieve our long-term financial objectives." "We are confident we have the right strategies in place. We have made significant progress towards enhancing our integrated architecture, furniture and technology offerings with the acquisitions of PolyVision and Custom Cable. We will continue to accelerate the implementation of key initiatives aimed at meeting user needs and improving our profitability," said Mr. Hackett. Fourth Quarter Results Fourth quarter results were in line with the company's revised guidance issued on February 12, 2002 and reflect further softening in global demand for office furniture and additional International reserves primarily related to dealer receivables and inventories. Quarterly revenue of $660.4 million, declined 33 percent from $985.7 million reported in the prior year. Excluding acquisitions, revenue was down 37 percent compared with the prior year quarter. Order rates declined in the fourth quarter. Net loss was $(34.3) million, or $(0.23) per diluted share compared to net income of $25.7 million, or $0.17 per diluted share in the fourth quarter of the prior year. Excluding non-recurring charges, net loss was $(14.2) million, or $(0.10) per diluted share in the current quarter, compared with net income of $41.2 million, or $0.27 per diluted share in the prior year. The company incurred $20.1 million of non-recurring after-tax charges primarily related to restructuring, severance, and reductions in the book value of assets associated with certain production lines. Pressure on margins continued because of decreased fixed overhead absorption from lower sales, partially offset by a $14 million reduction to the company's retirement contribution accruals. "Our teams moved quickly and aggressively in response to the reality of lower revenue," said Mr. James P. Keane, chief financial officer. "We've made ongoing adjustments to reduce our cost structure and as a result, generated positive operating cash flow, reduced debt and lowered our breakeven point without compromising major new product development initiatives and other projects key to our strategy." Outlook For the first quarter of fiscal 2003, the company expects revenue to decline approximately 5 percent from fourth quarter levels. Despite ongoing cost reduction efforts that have significantly reduced the company's breakeven point, the company expects to incur a loss of (0.07) to $(0.12) per share, before non-recurring charges. The company expects to record a $7 to $10 million after-tax charge in the first quarter related to further cost reduction activities. "Although we've seen some improvement in March order rates and bid activity in North America, it's too soon to project that a near-term recovery in furniture demand is underway," said Mr. Keane. "International, which lagged North America in order declines, has not yet experienced an improvement in demand. There is a growing consensus among economists that we will see a gradual recovery in capital spending in the U.S. this year. Such a recovery should be aided by the recent passage of the U.S. economic stimulus package with favorable depreciation treatment for capital goods." Mr. Hackett concluded, "Looking ahead, we will continue, in both our North America and International operations, to expand our market base, launch new products and services and sustain the flow of exciting new research. We will also maintain our emphasis on financial discipline, and we plan to balance actions that reduce costs, while maintaining the ability to respond quickly when business recovers." Beginning in the first quarter, the company is adopting the new accounting standard FAS142 and expects to take a pre-tax non-cash write-off of excess goodwill related to its International business segment in the range of $125 to $175 million. Goodwill amortization expense approximated $14 million in each of fiscal years 2002 and 2001. The company's fiscal 2003 amortization expense will be approximately $9 million lower than fiscal 2002, including a $5 million increase in intangible amortization associated with the PolyVision and Custom Cable acquisitions. #### ######################## ######################### ______________________________________________- Association of Government Leasing and Finance 21st Annual Spring Conference - Back to Business In Baltimore May 1-3 * Renaissance Harborplace * Baltimore, Maryland The AGL&F is pleased to announce that the program for the Spring Conference is out and should be in your mailboxes shortly. In the meantime, you can download a copy of the registration brochure........ click on the following link for more information....... http://www.aglf.org/tell/spring_conference.html
Before April 15---$425 members/$580 Non-Members ( If you want to get involved in municipal and government leasing, a growing marketplace, this is the conference to attend. To learn more about the agenda, here is an Adobe download: http://www.aglf.org/aglfspring.pdf 2001 Annual Fall Conference Wrap-up The 21st Annual AGL&F Conference took place from November 7-9 at Loews Ventana Canyon Resort in Tucson, Arizona. Thanks to our many sponsors of the fall conference that helped to make this conference such a success......... click on the following link for more information....... http://www.aglf.org/tell/fall_conference.html Graham Hauck Executive Director Association for Governmental Leasing and Finance 1255 23rd Street, NW Washington, DC 20037 202.742.AGLF (2453) fax: 202.833.3636 email: gsh@aglf.org http://www.aglf.org Streamlined Sales Tax Project Conference Call The Equipment Leasing Association has scheduled a conference call to decide the fate of efforts to write a Sale/Leaseback provision for the interstate agreement being drafted by the Streamlined Sales Tax Project. The conference call is planned for 11:00 AM Eastern/8:00 AM Pacific on Thursday, March 28. To participate dial 334/323-4045 and dial in the pass code - 78864#. Be sure to press # after entering the password. Please respond to dbrown@elamail.com if you expect to participate. An industry subcommittee has struggled in vain for over 6 months to reach consensus on this issue with state revenue officials. A lack of interest in this conference call, perhaps fewer than 20 respondents, will imply this effort be concluded so other important issues can be taken up with Project officials. Dennis Brown DBROWN@ELAMAIL.COM |
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