Manhattan Bridge Capital, Inc. Reports Second Quarter 2021 Results

Rhea-AI Summary

Manhattan Bridge Capital reported total revenues of approximately $1,713,000 for Q2 2021, a slight decline of 1.6% from $1,741,000 in Q2 2020. The decrease was mainly due to lower interest rates and increased competition. Net income for the quarter was around $1,058,000, consistent in per-share earnings at $0.11. For the first half of 2021, total revenue reached $3,443,000, down from $3,452,000 in 2020, driven by similar factors. The company completed a public offering of 1,875,000 shares at $7.20 each, raising $13.5 million, which will bolster growth.

Positive

• Completion of a successful public offering raising $13.5 million.
• No loan defaults reported for the quarter.
• Increase in origination fees contributed positively.

Negative

• Decrease in total revenues of 1.6% compared to Q2 2020.
• Lower interest income due to market conditions and competition.

GREAT NECK, N.Y., July 23, 2021 (GLOBE NEWSWIRE) -- Manhattan Bridge Capital, Inc. (Nasdaq: LOAN) announced today that its total revenues for the three months ended June 30, 2021 were approximately $1,713,000 compared to approximately $1,741,000 for the three months ended June 30, 2020, a decrease of $28,000, or 1.6%. The decrease in revenues was primarily attributable to lower interest rates charged on loans due to market conditions and intense competition from other lenders. For the three months ended June 30, 2021 and 2020, approximately $1,424,000 and $1,490,000, respectively, of our revenues were attributable to interest income on secured commercial loans that we offer to real estate investors, and approximately $290,000 and $251,000, 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 three months ended June 30, 2021 was approximately $1,058,000, or $0.11 per basic and diluted share (based on approximately 9.62 million weighted-average outstanding common shares), as compared to approximately $1,097,000, or $0.11 per basic and diluted share (based on approximately 9.63 million weighted-average outstanding common shares), for the three months ended June 30, 2020. The decrease is primarily attributable to the decrease in interest income resulting from the lower interest rates charged on loans.

Total revenues for the six months ended June 30, 2021 were approximately $3,443,000 compared to approximately $3,452,000 for the six months ended June 30, 2020, a decrease of $9,000. The decrease in revenues was primarily attributable to lower interest rates charged on loans due to market conditions and intense competition from other lenders, offset by an increase in origination fees. For the six months ended June 30, 2021 and 2020, revenues of approximately $2,867,000 and $2,964,000, respectively, were attributable to interest income on secured commercial loans that we offer to real estate investors, and approximately $576,000 and $488,000, respectively, were attributable to origination fees on such loans.

Net income for the six months ended June 30, 2021 was approximately $2,164,000, or $0.22 per basic and diluted share (based on approximately 9.62 million weighted-average outstanding common shares), as compared to approximately $2,113,000, or $0.22 per basic and diluted share (based on approximately 9.64 million weighted-average outstanding common shares), for the six months ended June 30, 2020. This increase is primarily attributable to the decrease in interest expense.

As of June 30, 2021, total stockholders' equity was approximately $33,077,000.

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.

Assaf Ran, Chairman of the Board and CEO, stated, “I believe that the recent follow-on stock offering was beneficial to the Company. The transaction will give us the opportunity to support our growth as the economy recovers, and it will increase our book value. In addition, once again, we demonstrated an offering at a price higher than the price of our previous offering. Revenue and earnings of the second quarter were affected by lower interest rates and a large amount of paid-off loans. Nevertheless, I'm pleased to present another quarter of no defaults.”

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 our stock offering will support our growth as the economy recovers and that it will increase our book 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

		June 30, 2021				December 31, 2020
		(unaudited)				(audited)
Assets
Loans receivable		53,385,871				58,097,970
Interest receivable on loans		915,738				827,236
Cash		153,187				131,654
Cash - restricted		---				327,483
Other assets		140,932				66,566
Operating lease right-of-use asset, net		343,566				369,699
Deferred financing costs, net		15,056				22,807
Total assets	$	54,954,350			$	59,843,415
Liabilities and Stockholders’ Equity
Liabilities:
Line of credit	$	15,397,115			$	20,308,873
Senior secured notes (net of deferred financing costs of $359,784 and $397,327, respectively)		5,640,216				5,602,673
Deferred origination fees		357,753				367,638
Accounts payable and accrued expenses		133,912				168,940
Operating lease liability		348,835				372,907
Dividends payable		---				1,058,194
Total liabilities		21,877,831				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; 9,882,058 issued; 9,619,945 outstanding		9,882				9,882
Additional paid-in capital		33,163,628				33,157,096
Treasury stock, at cost – 262,113 shares		(798,939	)			(798,939	)
Retained earnings (accumulated deficit)		701,948				(403,849	)
Total stockholders’ equity		33,076,519				31,964,190
Total liabilities and stockholders’ equity	$	54,954,350			$	59,843,415

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

	Three Months Ended June 30,											Six Months Ended June 30,
	2021				2020				2021						2020
Interest income from loans	$	1,423,759			$	1,490,395			$	2,866,573					$	2,963,940
Origination fees	289,670				250,791				576,143						488,233
Total revenue	1,713,429				1,741,186				3,442,716						3,452,173
Operating costs and expenses:
Interest and amortization of deferred financing costs	316,915				326,247				634,101						678,689
Referral fees	2,643				1,386				4,394						1,928
General and administrative expenses	339,602				318,726				648,583						663,507
Total operating costs and expenses	659,160				646,359				1,287,078						1,344,124
Income from operations	1,054,269				1,094,827				2,155,638						2,108,049
Other income	4,500				3,000				9,000						6,000
Income before income tax expense	1,058,769				1,097,827				2,164,638						2,114,049
Income tax expense	(647		)		(645		)		(647				)		(645		)
Net income	$	1,058,122			$	1,097,182			$	2,163,991					$	2,113,404
Basic and diluted net income per common share outstanding:
--Basic	$	0.11			$	0.11			$	0.22					$	0.22
--Diluted	$	0.11			$	0.11			$	0.22					$	0.22
Weighted average number of common shares outstanding:
--Basic	9,619,945				9,628,405				9,619,945						9,640,146
--Diluted	9,619,945				9,628,405				9,619,945						9,640,146

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

FOR THE THREE MONTHS ENDED JUNE 30, 2021

	Common Shares			Additional Paid in Capital		Treasury Stock				Retained Earnings			Totals
	Shares	Amount				Shares	Cost
Balance, April 1, 2021	9,882,058	$	9,882	$	33,160,362	262,113	$	(798,939	)	$	702,020		$	33,073,325
Non - cash compensation					3,266									3,266
Dividends paid											(1,058,194	)		(1,058,194	)
Net income											1,058,122			1,058,122
Balance, June 30, 2021	9,882,058	$	9,882	$	33,163,628	262,113	$	(798,939	)	$	701,948		$	33,076,519

FOR THE THREE MONTHS ENDED JUNE 30, 2020

	Common Shares			Additional Paid in Capital		Treasury Stock				Retained Earnings			Totals
	Shares	Amount				Shares	Cost
Balance, April 1, 2020	9,882,058	$	9,882	$	33,147,298	249,823	$	(750,724	)	$	425,414		$	32,831,870
Purchase of treasury shares						5,390		(20,835	)					(20,835	)
Non - cash compensation					3,266									3,266
Dividends paid											(1,059,546	)		(1,059,546	)
Net income											1,097,182			1,097,182
Balance, June 30, 2020	9,882,058	$	9,882	$	33,150,564	255,213	$	(771,559	)	$	463,050		$	32,851,937

FOR THE SIX MONTHS ENDED JUNE 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
Non - cash compensation					6,532									6,532
Dividends paid											(1,058,194	)		(1,058,194	)
Net income											2,163,991			2,163,991
Balance, June 30, 2021	9,882,058	$	9,882	$	33,163,628	262,113	$	(798,939	)	$	701,948		$	33,076,519

FOR THE SIX MONTHS ENDED JUNE 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					6,532									6,532
Purchase of treasury shares						31,999		(151,871	)					(151,871	)
Dividends paid											(1,059,546	)		(1,059,546	)
Net income											2,113,404			2,113,404
Balance, June 30, 2020	9,882,058	$	9,882	$	33,150,564	255,213	$	(771,559	)	$	463,050		$	32,851,937

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

					Six Months
					Ended June 30,
						2021								2020
Cash flows from operating activities:
Net income					$	2,163,991							$	2,113,404
Adjustments to reconcile net income to net cash provided by
operating activities -
Amortization of deferred financing costs						45,294								50,256
Adjustment to operating lease right-of-use asset and liability						2,060								-200
Depreciation						1,153								548
Non-cash compensation expense						6,532								6,532
Changes in operating assets and liabilities:
Interest receivable on loans						(88,502	)							(124,303	)
Other assets						(56,768	)							(65,316	)
Accounts payable and accrued expenses						(35,028	)							(32,015	)
Deferred origination fees						(9,885	)							39,513
Net cash provided by operating activities						2,028,847								1,988,419
Cash flows from investing activities:
Issuance of short term loans						(15,567,677	)							(21,798,160	)
Collections received from loans						20,279,776								19,455,628
Release of loan holdback relating to mortgage receivable						---								(15,000	)
Purchase of fixed assets						---								(923	)
Net cash provided by (used in) investing activities						4,712,099								(2,358,455	)
Cash flows from financing activities:
(Repayment of) proceeds from line of credit, net						(4,911,758	)							2,843,235
Dividends paid						(2,116,388	)							(2,218,607	)
Pre-offering costs incurred						(18,750	)							---
Purchase of treasury shares						---								(151,871	)
Deferred financing costs incurred						---								(27,102	)
Net cash (used in) provided by financing activities						(7,046,896	)							445,655
Net (decrease) increase in cash						(305,950	)							75,619
Cash and restricted cash, beginning of year						459,137								118,407
Cash and restricted cash, end of period					$	153,187							$	194,026
Supplemental Cash Flow Information:
Taxes paid during the period					$	647							$	645
Interest paid during the period					$	603,869							$	650,130
Operating leases paid during the period					$	31,719							$	27,227
Supplemental Information – Noncash Information:
Interest receivable converted to loans receivable in connection with forbearance agreements					$	---							$	29,671

FAQ

What were the total revenues for Manhattan Bridge Capital (LOAN) in Q2 2021?

The total revenues for Q2 2021 were approximately $1,713,000.

How much did Manhattan Bridge Capital (LOAN) raise in its public offering in July 2021?

Manhattan Bridge Capital raised $13.5 million in its public offering.

What factors contributed to the revenue decline for LOAN in Q2 2021?

The revenue decline was primarily due to lower interest rates charged on loans and intense competition.

What was the net income for LOAN in the first half of 2021?

The net income for the first half of 2021 was approximately $2,164,000.

Did Manhattan Bridge Capital (LOAN) experience any loan defaults in Q2 2021?

No, the company reported no loan defaults for the quarter.