Manhattan Bridge Capital, Inc. Reports Third Quarter 2021 Results

·11 min read

GREAT NECK, N.Y., Oct. 20, 2021 (GLOBE NEWSWIRE) -- Manhattan Bridge Capital, Inc. (Nasdaq: LOAN) announced today that its net income for the three months ended September 30, 2021 was approximately $1,110,000, or $0.10 per basic and diluted share (based on approximately 11.3 million weighted-average outstanding common shares), as compared to approximately $1,151,000, or $0.12 per basic and diluted share (based on approximately 9.6 million weighted-average outstanding common shares), for the three months ended September 30, 2020. The decrease is primarily attributable to a decrease in interest income from loans, partially offset by a decrease in interest expense.

Total revenues for the three months ended September 30, 2021 were approximately $1,627,000, as compared to approximately $1,786,000 for the three months ended September 30, 2020, a decrease of $159,000 or 8.9%. The decrease in revenue was primarily attributable to lower interest rates charged on loans due to market conditions and intense competition from other lenders, partially offset by an increase in origination fees. For the three months ended September 30, 2021 and 2020, approximately $1,323,000 and $1,521,000, respectively, of our revenues were attributable to interest income on secured commercial loans that we offer to real estate investors, and approximately $304,000 and $265,000, respectively, of our revenues were attributable to origination fees on such loans. The loans are principally secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers.

Net income for the nine months ended September 30, 2021 was approximately $3,274,000, or $0.32 per basic and diluted share (based on approximately 10.2 million weighted-average outstanding common shares), as compared to approximately $3,264,000, or $0.34 per basic and diluted share (based on approximately 9.6 million weighted-average outstanding common shares) for the nine months ended September 30, 2020, an increase of $10,000. This increase is primarily attributable to a decrease in interest expense, offset by a decrease in revenue.

Total revenues for the nine months ended September 30, 2021 were approximately $5,070,000 compared to approximately $5,239,000 for the nine months ended September 30, 2020, a decrease of $169,000, or 3.2%. The decrease in revenue was primarily attributable to lower interest rates charged on loans due to market conditions and intense competition from other lenders, partially offset by an increase in origination fees. For the nine months ended September 30, 2021 and 2020, revenues of approximately $4,190,000 and $4,485,000, respectively, were attributable to interest income on the secured commercial loans that we offer to real estate investors, and approximately $880,000 and $753,000, respectively, of our revenues were attributable to origination fees on such loans. The loans are principally secured by collateral consisting of real estate and accompanied by personal guarantees from the principals of the borrowers.

As previously announced, on July 9, 2021, we completed an underwritten public offering of 1,875,000 of our common shares at a public offering price of $7.20 per share. The gross proceeds raised by us in the offering were $13,500,000, before deducting underwriting discounts and commissions and other estimated offering expenses. The total net proceeds from the offering of approximately $12,354,000 were used to reduce the outstanding balance of our existing credit line. We granted the underwriters a 30-day option to purchase up to an additional 281,250 of our common shares to cover over-allotments, if any. The option expired unexercised in August 2021.

As of September 30, 2021, total stockholders' equity was approximately $45,107,000, compared to approximately $31,964,000 as of December 31, 2020.

Assaf Ran, Chairman of the Board and CEO, stated, “Immediately after the successful public offering at the beginning of the third quarter, we accelerated sales efforts and closed approximately 60% more loans versus the first and second quarters of 2021 on an aggregate basis. However, the amount of loans that was repaid quickly was also unusually high, reflecting what we believe is a strong and liquid portfolio. In addition, we are experiencing a competitive market and see continued pressure on interest rates. Furthermore, our sales team is now larger and generating more loans, and as we have access to more capital, I believe that we’re on the right track to increase the scale of the portfolio. You may have noticed that I agreed to forgo my salary for the fourth quarter. The reason for that is to try to avoid a “return of capital” in our dividend distribution, as we paid the July 15th dividend to the new shareholders before we had an opportunity to deploy the new funds. Most importantly, once again, we have had no defaults since inception,” 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 belief that the high amount of loan repayments reflects a strong and liquid portfolio and the belief that we are on the right track to increase the scale of the portfolio, 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

September 30, 2021

December 31, 2020

(unaudited)

(audited)

Assets

Loans receivable

$

53,574,221

$

58,097,970

Interest receivable on loans

995,384

827,236

Cash

109,692

131,654

Cash - restricted

---

327,483

Other assets

93,387

66,566

Operating lease right-of-use asset, net

330,795

369,699

Deferred financing costs, net

12,798

22,807

Total assets

$

55,116,277

$

59,843,415

Liabilities and Stockholders’ Equity

Liabilities:

Line of credit

$

3,484,151

$

20,308,873

Senior secured notes (net of deferred financing costs of $341,013 and $397,327, respectively)

5,658,987

5,602,673

Deferred origination fees

453,583

367,638

Accounts payable and accrued expenses

75,958

168,940

Operating lease liability

336,606

372,907

Dividends payable

---

1,058,194

Total liabilities

10,009,285

27,879,225

Commitments and contingencies

Stockholders’ equity:

Preferred stock - $.01 par value; 5,000,000 shares authorized; none issued

---

---

Common stock - $.001 par value; 25,000,000 shares authorized; 11,757,058 and 9,882,058 issued; 11,494,945 and 9,619,945 outstanding

11,757

9,882

Additional paid-in capital

45,519,479

33,157,096

Treasury stock, at cost – 262,113 shares

(798,939

)

(798,939

)

Retained earnings (accumulated deficit)

374,695

(403,849

)

Total stockholders’ equity

45,106,992

31,964,190

Total liabilities and stockholders’ equity

$

55,116,277

$

59,843,415




MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

Three Months
Ended September 30,

Nine Months
Ended September 30,

2021

2020

2021

2020

Interest income from loans

$

1,323,085

$

1,521,474

$

4,189,658

$

4,485,414

Origination fees

304,297

264,878

880,440

753,111

Total revenue

1,627,382

1,786,352

5,070,098

5,238,525

Operating costs and expenses:

Interest and amortization of deferred financing costs

184,914

337,901

819,015

1,016,590

Referral fees

2,069

1,641

6,463

3,569

General and administrative expenses

335,284

305,407

983,867

968,914

Total operating costs and expenses

522,267

644,949

1,809,345

1,989,073

Income from operations

1,105,115

1,141,403

3,260,753

3,249,452

Other income

4,500

9,500

13,500

15,500

Income before income tax expense

1,109,615

1,150,903

3,274,253

3,264,952

Income tax expense

---

---

(647

)

(645

)

Net income

$

1,109,615

$

1,150,903

$

3,273,606

$

3,264,307

Basic and diluted net income per common share outstanding:

--Basic

$

0.10

$

0.12

$

0.32

$

0.34

--Diluted

$

0.10

$

0.12

$

0.32

$

0.34

Weighted average number of common shares outstanding

--Basic

11,331,902

9,625,140

10,196,868

9,635,107

--Diluted

11,331,902

9,625,140

10,196,868

9,635,107


MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(unaudited)

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

Common Shares

Additional Paid
in Capital

Treasury Stock

Retained
Earnings

Totals

Shares

Amount

Shares

Cost

Balance, July 1, 2021

9,882,058

$

9,882

$

33,163,628

262,113

$

(798,939

)

$

701,948

$

33,076,519

Public offering, net

1,875,000

1,875

12,352,585

12,354,460

Non-cash compensation

3,266

3,266

Dividends paid

(1,436,868

)

(1,436,868

)

Net income

1,109,615

1,109,615

Balance, September 30, 2021

11,757,058

$

11,757

$

45,519,479

262,113

$

(798,939

)

$

374,695

$

45,106,992

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2020

Common Shares

Additional Paid
in Capital

Treasury Stock

Retained
Earnings

Totals

Shares

Amount

Shares

Cost

Balance, July 1, 2020

9,882,058

$

9,882

$

33,150,564

255,213

$

(771,559

)

$

463,050

$

32,851,937

Purchase of treasury shares

6,900

(27,380

)

(27,380

)

Non-cash compensation

3,266

3,266

Dividends paid

(962,684

)

(962,684

)

Net income

1,150,903

1,150,903

Balance, September 30, 2020

9,882,058

$

9,882

$

33,153,830

262,113

$

(798,939

)

$

651,269

$

33,016,042

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021

Common Shares

Additional Paid
in Capital

Treasury Stock

Accumulated
Deficit
(Retained
Earnings)

Totals

Shares

Amount

Shares

Cost

Balance, January 1, 2021

9,882,058

$

9,882

$

33,157,096

262,113

$

(798,939

)

$

(403,849

)

$

31,964,190

Public offering, net

1,875,000

1,875

12,352,585

12,354,460

Non-cash compensation

9,798

9,798

Dividends paid

(2,495,062

)

(2,495,062

)

Net income

3,273,606

3,273,606

Balance, September 30, 2021

11,757,058

$

11,757

$

45,519,479

262,113

$

(798,939

)

$

374,695

$

45,106,992

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

Common Shares

Additional Paid
in Capital

Treasury Stock

Accumulated
Deficit
(Retained
Earnings)

Totals

Shares

Amount

Shares

Cost

Balance, January 1, 2020

9,882,058

$

9,882

$

33,144,032

223,214

$

(619,688

)

$

(590,808

)

$

31,943,418

Non-cash compensation

9,798

9,798

Purchase of treasury shares

38,899

(179,251

)

(179,251

)

Dividends paid

(2,022,230

)

(2,022,230

)

Net income

3,264,307

3,264,307

Balance, September 30, 2020

9,882,058

$

9,882

$

33,153,830

262,113

$

(798,939

)

$

651,269

$

33,016,042


MANHATTAN BRIDGE CAPITAL, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)

Nine Months

Ended September 30,

2021

2020

Cash flows from operating activities:

Net income

$

3,273,606

$

3,264,307

Adjustments to reconcile net income to net cash provided by
operating activities -

Amortization of deferred financing costs

66,324

76,136

Adjustment to operating lease right-of-use asset and liability

2,603

(333

)

Depreciation

1,716

744

Non-cash compensation expense

9,798

9,798

Changes in operating assets and liabilities:

Interest receivable on loans

(168,148

)

(163,650

)

Other assets

(28,538

)

(35,156

)

Accounts payable and accrued expenses

(92,982

)

(19,241

)

Deferred origination fees

85,945

130,795

Net cash provided by operating activities

3,150,324

3,263,400

Cash flows from investing activities:

Issuance of short term loans

(28,534,303

)

(35,410,076

)

Collections received from loans

33,058,052

31,041,693

Release of loan holdback relating to mortgage receivable

---

(15,000

)

Purchase of fixed assets

---

(923

)

Net cash provided by (used in) investing activities

4,523,749

(4,384,306

)

Cash flows from financing activities:

Proceeds from public offering, net

12,354,460

---

(Repayment of) proceeds from line of credit, net

(16,824,722

)

4,546,858

Dividends paid

(3,553,256

)

(3,181,291

)

Purchase of treasury shares

---

(179,251

)

Deferred financing costs incurred

---

(27,102

)

Net cash (used in) provided by financing activities

(8,023,518

)

1,159,214

Net (decrease) increase in cash

(349,445

)

38,308

Cash and restricted cash, beginning of year

459,137

118,407

Cash, end of period

$

109,692

$

156,715

Supplemental Cash Flow Information:

Taxes paid during the period

$

647

$

645

Interest paid during the period

$

811,610

$

954,622

Operating leases paid during the period

$

47,600

$

40,973

Non-cash Investing Activities:

Interest receivable converted to loans receivable in connection with forbearance agreements

$

---

$

29,671

CONTACT: Contact: Assaf Ran, CEO Vanessa Kao, CFO (516) 444-3400 SOURCE: Manhattan Bridge Capital, Inc.


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