First Marblehead Corp (FMD)

[Apophis]

First Marblehead Announces Third Quarter Fiscal 2009 Results
08:05 a.m. 04/28/2009 Provided By Market Wire


BOSTON, MA -- (MARKET WIRE) -- 04/28/09 -- The First Marblehead Corporation (FMD) today announced its financial and operating results for the third quarter of fiscal 2009 and for the nine-month period ended on March 31, 2009.

Total revenues for the third quarter of fiscal 2009 were $(130.6) million, as compared to $(251.8) million for the same period last year. Service revenues for the third quarter of fiscal 2009 reflected the previously announced sale of the company's subsidiary NC Residuals Owners Trust, which resulted in a decrease in residuals receivable of approximately $134.5 million. NC Residuals Owners Trust held residual interests in all fifteen of the National Collegiate Student Loan Trusts that the company had facilitated. As a result of non-cash, pre-tax adjustments, the estimated fair value of the company's remaining service receivables decreased by an additional $5.9 million during the third quarter of fiscal 2009, as compared to a total decrease of approximately $291.1 million during the third quarter of fiscal 2008.

The net loss for the third quarter of fiscal 2009 was $140.7 million, or $1.42 per share, compared to a net loss of $229.6 million, or $2.36 per share, for the same period last year. Non-interest expenses, excluding the $47.6 million unrealized loss on education loans held for sale, decreased $96.1 million or 78% from the same period last year as a result of the company's expense reduction initiatives.

Total revenues for the nine-month period ended March 31, 2009 were $(301.6) million, a decrease from $5.0 million for the same period last year. The company completed two securitization transactions with revenues totaling $319.1 million in the first nine months of fiscal 2008. The company did not complete any securitizations in the first nine months of fiscal 2009. Revenues also decreased between periods as a result of the sale of NC Residuals Owners Trust. The net loss for the nine-months ended March 31, 2009 was $326.9 million, or $3.30 per share, compared with a net loss of $178.4 million, or $1.88 per share, for the same period last year.

The company ended the quarter with $184.8 million in cash, cash equivalents and investments. The sale of NC Residuals Owners Trust is expected to generate a cash refund for taxes previously paid, and the company recorded a net income tax receivable of approximately $170.0 million at March 31, 2009. Net operating cash usage* for the quarter ended March 31, 2009 was approximately $13.5 million compared to approximately $15.0 million for the prior quarter. (See below under the heading "Use of Non-GAAP Financial Measures.")