The FINOVA Group Inc. Announces Net Loss for 2000 (Subject to Final Audit)

Apr 02, 2001, 01:00 ET from The FINOVA Group Inc.

    SCOTTSDALE, Ariz., April 2 /PRNewswire/ -- The FINOVA Group Inc.
 (NYSE:   FNV) today announced a net loss of $939.8 million or $15.41 per diluted
 share for the year ended Dec. 31, 2000, compared to net income of
 $215.2 million or $3.41 per diluted share in 1999.  The results included a net
 loss from continuing operations of $546.7 million or $8.96 per diluted share
 in 2000 compared to net income of $218.2 million or $3.45 per diluted share in
 1999, and a net loss from discontinued operations in 2000 of $393.1 million or
 $6.45 per diluted share compared to a net loss of $3.0 million or
 $0.04 per diluted share in 1999.
     For the quarter ended Dec. 31, 2000, the Company announced a net loss of
 $719.1 million or $11.78 per diluted share compared to net income of
 $56.6 million or $0.89 per diluted share in the fourth quarter of 1999.  The
 net loss for the fourth quarter of 2000 from continuing operations was
 $579.0 million or $9.49 per diluted share compared to net income of
 $58.7 million or $0.92 per diluted share in the fourth quarter of 1999, and
 the net loss from discontinued operations for the fourth quarter of 2000 was
 $140.1 million or $2.29 per diluted share compared to a net loss of
 $2.1 million or $0.03 per diluted share in the fourth quarter of 1999.
     In 2000, FINOVA experienced significant deterioration in the credit
 quality of its portfolio caused in part by a softening U.S. economy and
 certain industry specific economic weaknesses affecting many of its customers
 in those industries.  Additionally, with the loss of its investment grade
 credit ratings and limited access to capital, FINOVA Capital's cost of funds
 increased significantly during the course of the year.  The impact of these
 events and current economic conditions resulted in increased levels of problem
 accounts and higher cost of funds (resulting in lower interest margins),
 higher reserve requirements, higher write-offs, losses on investments and
 disposal of assets, impairment of intangible assets, reduced tax benefits, and
 the decision to exit certain businesses.
 
     Other Matters
     On Feb. 26, 2001 FINOVA entered into a commitment with Berkshire Hathaway
 Inc., Leucadia National Corporation and Berkadia, LLC, an entity jointly owned
 by Berkshire Hathaway and Leucadia, pursuant to which Berkadia would lend
 $6 billion on a senior secured basis to FINOVA Capital, FINOVA's principal
 operating subsidiary, to facilitate a Chapter 11 restructuring of its
 outstanding debt.  On Mar. 7, 2001, FINOVA and eight of its subsidiaries filed
 for protection under Chapter 11 of the United States Bankruptcy Code.  On the
 first day of these proceedings, the bankruptcy court granted various orders
 authorizing FINOVA to continue operating in the ordinary course of business,
 including funding commitments to its customers.  As of the filing date, FINOVA
 had over $1 billion of cash on hand.
     Due to delays caused by the bankruptcy process and other events, FINOVA
 has filed for an automatic 15-day extension to file its annual report on Form
 10-K with the Securities and Exchange Commission.  FINOVA expects to file the
 10-K on or before Apr. 16, 2001.
 
     The FINOVA Group Inc., through its principal operating subsidiary, FINOVA
 Capital Corporation, is a financial services company focused on providing a
 broad range of capital solutions primarily to midsize business.  FINOVA is
 headquartered in Scottsdale, Ariz. with business offices throughout the U.S.
 and in London, U.K. and Toronto, Canada.  For more information, visit the
 company's website at www.finova.com.
 
     This news release contains forward-looking statements such as estimates of
 gains or losses, as well as other predictions or forecasts. FINOVA assumes no
 obligation to update those statements to reflect actual results, changes in
 assumptions or other factors.  The forward-looking statements are subject to
 known and unknown risks, uncertainties and other factors that could cause
 actual results to differ materially from those projected.  Those factors
 include FINOVA's ability to address its financing requirements in light of its
 existing debt obligations and market conditions; pending and potential
 litigation related to charges to earnings; the results of efforts to implement
 business strategy, including the ability to successfully conclude its
 reorganization proceedings and the pending transaction with Berkadia, LLC; the
 ability to attract and retain key personnel and customers; conditions that
 adversely impact FINOVA's borrowers and their ability to meet their
 obligations to FINOVA; actual results in connection with continuing or
 discontinued operations and the disposition of assets; the adequacy of
 FINOVA's loan loss reserves and other risks detailed in FINOVA's SEC reports,
 including page 15 of FINOVA's 10-K for 1999.
 
 
                             The FINOVA Group Inc.
                         And Consolidated Subsidiaries
                            Selected Financial Data
                            (Subject to Final Audit)
                 (Dollars in Thousands, except per share data)
 
 
                                 Quarter Ended           Twelve Months Ended
                                    Dec. 31,                  Dec. 31,
                               2000         1999         2000         1999
 
     OPERATIONS:
 
     Interest margins earned   $81,936    $130,154      $453,565    $473,187
     Provision for credit
      losses                  (501,653)    (10,207)     (643,000)    (22,390)
     (Losses) gains on
      investments and
      disposal of assets      (113,040)     22,009      (168,589)     67,886
     Operating expenses       (277,184)    (47,474)     (399,412)   (168,697)
     (Loss) income from
      continuing operations   (578,956)     58,676      (546,709)    218,241
     Net (loss) income        (719,101)     56,619      (939,817)    215,244
 
 
                                                          As of Dec. 31,
                                                        2000          1999
 
     FINANCIAL POSITION:
 
     Managed assets                                $10,537,875   $10,443,136
     Nonaccruing assets                                921,351       174,993
     Reserve for credit losses                         578,750       178,266
     Net assets of discontinued operations           1,162,223     2,702,236
     Total assets                                   12,089,086    13,889,889
     Total debt                                     10,997,687    11,407,767
     Common shareowners' equity                        672,934     1,663,381
 
 

SOURCE The FINOVA Group Inc.
    SCOTTSDALE, Ariz., April 2 /PRNewswire/ -- The FINOVA Group Inc.
 (NYSE:   FNV) today announced a net loss of $939.8 million or $15.41 per diluted
 share for the year ended Dec. 31, 2000, compared to net income of
 $215.2 million or $3.41 per diluted share in 1999.  The results included a net
 loss from continuing operations of $546.7 million or $8.96 per diluted share
 in 2000 compared to net income of $218.2 million or $3.45 per diluted share in
 1999, and a net loss from discontinued operations in 2000 of $393.1 million or
 $6.45 per diluted share compared to a net loss of $3.0 million or
 $0.04 per diluted share in 1999.
     For the quarter ended Dec. 31, 2000, the Company announced a net loss of
 $719.1 million or $11.78 per diluted share compared to net income of
 $56.6 million or $0.89 per diluted share in the fourth quarter of 1999.  The
 net loss for the fourth quarter of 2000 from continuing operations was
 $579.0 million or $9.49 per diluted share compared to net income of
 $58.7 million or $0.92 per diluted share in the fourth quarter of 1999, and
 the net loss from discontinued operations for the fourth quarter of 2000 was
 $140.1 million or $2.29 per diluted share compared to a net loss of
 $2.1 million or $0.03 per diluted share in the fourth quarter of 1999.
     In 2000, FINOVA experienced significant deterioration in the credit
 quality of its portfolio caused in part by a softening U.S. economy and
 certain industry specific economic weaknesses affecting many of its customers
 in those industries.  Additionally, with the loss of its investment grade
 credit ratings and limited access to capital, FINOVA Capital's cost of funds
 increased significantly during the course of the year.  The impact of these
 events and current economic conditions resulted in increased levels of problem
 accounts and higher cost of funds (resulting in lower interest margins),
 higher reserve requirements, higher write-offs, losses on investments and
 disposal of assets, impairment of intangible assets, reduced tax benefits, and
 the decision to exit certain businesses.
 
     Other Matters
     On Feb. 26, 2001 FINOVA entered into a commitment with Berkshire Hathaway
 Inc., Leucadia National Corporation and Berkadia, LLC, an entity jointly owned
 by Berkshire Hathaway and Leucadia, pursuant to which Berkadia would lend
 $6 billion on a senior secured basis to FINOVA Capital, FINOVA's principal
 operating subsidiary, to facilitate a Chapter 11 restructuring of its
 outstanding debt.  On Mar. 7, 2001, FINOVA and eight of its subsidiaries filed
 for protection under Chapter 11 of the United States Bankruptcy Code.  On the
 first day of these proceedings, the bankruptcy court granted various orders
 authorizing FINOVA to continue operating in the ordinary course of business,
 including funding commitments to its customers.  As of the filing date, FINOVA
 had over $1 billion of cash on hand.
     Due to delays caused by the bankruptcy process and other events, FINOVA
 has filed for an automatic 15-day extension to file its annual report on Form
 10-K with the Securities and Exchange Commission.  FINOVA expects to file the
 10-K on or before Apr. 16, 2001.
 
     The FINOVA Group Inc., through its principal operating subsidiary, FINOVA
 Capital Corporation, is a financial services company focused on providing a
 broad range of capital solutions primarily to midsize business.  FINOVA is
 headquartered in Scottsdale, Ariz. with business offices throughout the U.S.
 and in London, U.K. and Toronto, Canada.  For more information, visit the
 company's website at www.finova.com.
 
     This news release contains forward-looking statements such as estimates of
 gains or losses, as well as other predictions or forecasts. FINOVA assumes no
 obligation to update those statements to reflect actual results, changes in
 assumptions or other factors.  The forward-looking statements are subject to
 known and unknown risks, uncertainties and other factors that could cause
 actual results to differ materially from those projected.  Those factors
 include FINOVA's ability to address its financing requirements in light of its
 existing debt obligations and market conditions; pending and potential
 litigation related to charges to earnings; the results of efforts to implement
 business strategy, including the ability to successfully conclude its
 reorganization proceedings and the pending transaction with Berkadia, LLC; the
 ability to attract and retain key personnel and customers; conditions that
 adversely impact FINOVA's borrowers and their ability to meet their
 obligations to FINOVA; actual results in connection with continuing or
 discontinued operations and the disposition of assets; the adequacy of
 FINOVA's loan loss reserves and other risks detailed in FINOVA's SEC reports,
 including page 15 of FINOVA's 10-K for 1999.
 
 
                             The FINOVA Group Inc.
                         And Consolidated Subsidiaries
                            Selected Financial Data
                            (Subject to Final Audit)
                 (Dollars in Thousands, except per share data)
 
 
                                 Quarter Ended           Twelve Months Ended
                                    Dec. 31,                  Dec. 31,
                               2000         1999         2000         1999
 
     OPERATIONS:
 
     Interest margins earned   $81,936    $130,154      $453,565    $473,187
     Provision for credit
      losses                  (501,653)    (10,207)     (643,000)    (22,390)
     (Losses) gains on
      investments and
      disposal of assets      (113,040)     22,009      (168,589)     67,886
     Operating expenses       (277,184)    (47,474)     (399,412)   (168,697)
     (Loss) income from
      continuing operations   (578,956)     58,676      (546,709)    218,241
     Net (loss) income        (719,101)     56,619      (939,817)    215,244
 
 
                                                          As of Dec. 31,
                                                        2000          1999
 
     FINANCIAL POSITION:
 
     Managed assets                                $10,537,875   $10,443,136
     Nonaccruing assets                                921,351       174,993
     Reserve for credit losses                         578,750       178,266
     Net assets of discontinued operations           1,162,223     2,702,236
     Total assets                                   12,089,086    13,889,889
     Total debt                                     10,997,687    11,407,767
     Common shareowners' equity                        672,934     1,663,381
 
 SOURCE  The FINOVA Group Inc.