Thornburg to Announce Substantial First Quarter Loss

May 20, 2008 No Comments »

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Thornburg Mortgage announced Monday that it will file its delayed first quarter earnings by June 2, with the company expecting a “substantial net loss.”

The Santa, Fe, New Mexico-based mortgage lender said it was unable to release earnings by the scheduled date (May 19) because it needed more time to determine the correct accounting for its Override Agreement and subsequent capital raise.

It’s unclear how bad the loss may be, but with shares of Thornburg trading well below a dollar, there isn’t much room for bad news.

The jumbo loan adjustable-rate mortgage king reported a profit of $75 million in the first quarter of 2007, and actually turned a $65 million profit in the fourth quarter of 2008, when it appeared as if they were turning the corner.

But Thornburg experienced even more pain than its $1 billion third-quarter loss after the value of its Alt-A mortgage securities plummeted in value, forcing the company into margin calls it couldn’t meet.

The company has hung on so far after raising much needed capital, but it still needs its shareholders to approve the dilution of its stock to complete the financing agreement before breathing any sigh of relief.

Shares of Thornburg were down 3 cents, or 4.65%, to 66 cents in afternoon trading on Wall Street, well below their 52-week high of $28.23.

(photo: peasap)

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