GlobeNewswire Inc | Aug 16, 2021 02:15PM EDT

August 16, 2021

CHRISTIANSTED, U.S. Virgin Islands, Aug. 16, 2021 (GLOBE NEWSWIRE) -- Altisource Asset Management Corporation (AAMC or the Company) (NYSE American: AAMC) today announced financial and operating results for the second quarter of 2021.

Second Quarter 2021 Highlights and Recent Developments

-- Net income from continuing operations of $2.2 million for the second quarter was fueled in part by (i) the realized gains on sales of the equity securities and the associated dividend income, and (ii) reduced expenses on salaries and benefits due to forfeited bonuses from departed executives. -- Maintained liquidity to position the Company to have access to capital to consummate prospective business opportunities. Liquidity consists of $52.0 million in cash and $39.8 million in equity securities. -- Paid off the $28.4 million outstanding balance on the margin loan from proceeds of sales of equity securities. -- Hired Stephen Krallman as the new Chief Financial Officer of the Company. -- Hired Kevin Sullivan to be the new General Counsel and Chief Compliance Officer of the Company.

The Companys attention and focus, stated Thomas K. McCarthy, Interim Chief Executive Officer, continues to be to identify and evaluate business opportunities and acquisition targets in which to potentially focus the Companys resources. In addition to the fund management and mortgage businesses more closely related to the Company's history, management has explored separate and distinct new business lines. While no final decision has been made on the new businesses that the Company will pursue, the Company is in different stages of discussion with several potential acquisition or merger targets including the fix and flip lending space, one in fee based real estate investment banking and one in a cryptocurrency related business.

Second Quarter 2021 Financial Results

AAMCs net income to common shareholders for the second quarter of 2021 was $2.2 million compared to a net loss of $(7.8) million for the same period in 2020. Diluted earnings per share was $1.01 for the quarter, compared with a diluted net loss per share of $(4.81) for the same period in 2020.

AAMC's net income to common shareholders for the six months ended June 30, 2021 was $8.1 million compared to a net loss of $(11.6) million for the same period in 2020. Due to a $71.9 million gain on settlement of preferred shares in the first quarter of 2021, which was recorded directly to equity, but is included in the numerator for our earnings per share calculations; diluted earnings per share was $37.41 for the six months ended June 30, 2021, compared with a diluted net loss per share of $(7.17) for the same period in 2020.

About AAMC

AAMC has historically been an asset management company that provides portfolio management and corporate governance services to investment vehicles but given the sale and discontinuance of certain operations the Company is in the process of repositioning itself. Additional information is available at www.altisourceamc.com.

Forward-looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding managements beliefs, estimates, projections, anticipations and assumptions with respect to, among other things, the Companys financial results, future operations, business plans and investment strategies as well as industry and market conditions. These statements may be identified by words such as anticipate, intend, expect, may, could, should, would, plan, estimate, target, seek, believe and other expressions or words of similar meaning. We caution that forward-looking statements are qualified by the existence of certain risks and uncertainties that could cause actual results and events to differ materially from what is contemplated by the forward-looking statements. Factors that could cause our actual results to differ materially from these forward-looking statements may include, without limitation, our ability to implement new businesses or, to the extent such businesses are developed, our ability to make them successful or sustain the performance of any such businesses; developments in the litigation regarding our redemption obligations under the Certificate of Designations of our Series A Convertible Preferred Stock; and other risks and uncertainties detailed in the Risk Factors and other sections described from time to time in the Companys current and future filings with the Securities and Exchange Commission. The foregoing list of factors should not be construed as exhaustive.

The statements made in this press release are current as of the date of this press release only. The Company undertakes no obligation to publicly update or revise any forward-looking statements or any other information contained herein, whether as a result of new information, future events or otherwise.

Altisource Asset Management CorporationCondensed Consolidated Statements of Operations(In thousands, except share and per share amounts)(Unaudited)

Three months ended June Six months ended June 30, 30, 2021 2020 2021 2020Expenses: Salaries and employee $ (345 ) $ 3,319 $ 3,200 $ 6,413 benefitsLegal and professional 2,655 1,746 4,540 3,226 feesGeneral and 611 564 1,364 1,150 administrativeTotal expenses 2,921 5,629 9,104 10,789 Other income (loss): Change in fair value of ? (5,279 ) 146 (5,913 )Front Yard common stockDividend income on Front ? ? ? 244 Yard common stockChange in fair value of (2,411 ) ? 3,310 ? equity securitiesDividend income 887 ? 3,041 ? Gain on sale of equity 6,360 ? 6,360 ? securitiesInterest expense (24 ) ? (60 ) ? Other income 4 6 139 24 Total other income (loss) 4,816 (5,273 ) 12,936 (5,645 ) Net income (loss) fromcontinuing operations 1,895 (10,902 ) 3,832 (16,434 )before income taxesIncome tax (benefit) (333 ) (690 ) 1,961 (568 )expenseNet income (loss) from 2,228 (10,212 ) 1,871 (15,866 )continuing operations Discontinued operations: Income from operationsrelated to Front Yard, ? 2,377 ? 4,274 net of taxGain on disposal ofoperations related to ? ? 7,485 ? Front YardIncome tax expense ? ? 1,272 ? related to disposalNet gain on discontinued ? 2,377 6,213 4,274 operations Net income (loss) 2,228 (7,835 ) 8,084 (11,592 )Amortization of preferred ? ? ? (42 )stock issuance costsNet income (loss)attributable to common $ 2,228 $ (7,835 ) $ 8,084 $ (11,634 )stockholders Continuing operations earnings per shareNet income (loss) from $ 2,228 (10,212 ) 1,871 (15,866 )continuing operationsReverse amortization ofpreferred stock issuance ? ? ? 42 costsGain on preferred stock ? ? 71,883 ? transactionNumerator for earningsper share from continuing $ 2,228 $ (10,212 ) $ 73,754 $ (15,824 )operations Discontinued operations earnings per shareNet income from $ ? $ 2,377 $ 6,213 $ 4,274 discontinued operations Earnings (loss) per share of common stock ? basic:Continuing operations ? $ 1.09 $ (6.27 ) $ 37.86 $ (9.80 )basicDiscontinued operations ? ? 1.46 3.19 2.63 basicEarnings (loss) per basic $ 1.09 $ (4.81 ) $ 41.05 $ (7.17 )common share Weighted average common 2,050,786 1,629,285 1,948,070 1,622,497 stock outstanding ? basic Earnings (loss) per shareof common stock ? diluted:Continuing operations ? $ 1.01 $ (6.27 ) $ 34.50 $ (9.80 )dilutedDiscontinued operations ? ? 1.46 2.91 2.63 dilutedEarnings (loss) per $ 1.01 $ (4.81 ) $ 37.41 $ (7.17 )diluted common share Weighted average commonstock outstanding ? 2,195,806 1,629,285 2,137,513 1,622,497 diluted

Altisource Asset Management CorporationCondensed Consolidated Balance Sheets(In thousands, except share and per share amounts) June 30, December 2021 31, 2020 (unaudited) Current assets: Cash and cash equivalents $ 52,027 $ 41,623 Equity securities, at fair value 39,804 ? Front Yard common stock, at fair value ? 47,355 Receivable from Front Yard ? 3,414 Dividends receivable 681 ? Prepaid expenses and other assets 2,875 3,328 Current assets held for sale ? 894 Total current assets 95,387 96,614 Non-current assets: Right-of-use lease assets 894 656 Other non-current assets 419 503 Non-current assets held for sale ? 1,979 Total non-current assets 1,313 3,138 Total assets $ 96,700 $ 99,752 Current liabilities: Accrued salaries and employee benefits $ 299 $ 2,539 Accounts payable and accrued liabilities 2,374 9,152 Short-term lease liabilities 128 75 Current liabilities held for sale ? 1,338 Total current liabilities 2,801 13,104 Non-current liabilities: Long-term lease liabilities 793 600 Other non-current liabilities 3,497 1,027 Non-current liabilities held for sale ? 1,599 Total non-current liabilities 4,290 3,226 Total liabilities 7,091 16,330 Commitments and contingencies: ? ? Redeemable preferred stock: Preferred stock, $0.01 par value, 250,000 and 250,000shares issued as June30, 2021 and December31, 2020,respectively. 168,200 shares outstanding and $168,200 168,200 250,000 redemption value as of June30, 2021 and 250,000shares outstanding and $250,000 redemption value as ofDecember31, 2020. Stockholders' deficit: Common stock, $0.01 par value, 5,000,000 authorizedshares; 3,416,541 and 2,055,561 shares issued andoutstanding, respectively, as of June30, 2021 and 34 30 2,966,207 and 1,650,212 shares issued and outstanding,respectively, as of December31, 2020Additional paid-in capital 127,372 46,574 Retained earnings 71,538 63,426 Accumulated other comprehensive loss 54 (65 )Treasury stock, at cost, 1,360,980 shares as ofJune30, 2021 and 1,315,995 shares as of December31, (277,589 ) (276,543 )2020Total stockholders' deficit (78,591 ) (166,578 )Total liabilities and equity $ 96,700 $ 99,752

FOR FURTHER INFORMATION CONTACT:Investor RelationsT: +1-704-275-9113E: IR@AltisourceAMC.com