Lomas Financial Corp. lost $17.7 million, or 88 cents a share, in its fiscal third quarter, which ended March 31. The company said Monday that $10.7 million of the loss came from continuing operations and $7 million from discontinued operations.
Investors responded by pounding the stock down by $2.50 a share, from $7.50, near the close on Tuesday.
Lomas, which has struggled recently, announced late Friday that it was negotiating the sale of its information- systems division and expected a deal soon. The unit lost $5.9 million before taxes in the quarter.
The unit has had trouble convincing potential clients that Lomas will have the staying power to support the operation.
"No one wants to sign a contract with Lomas with the company as weak as it is," said a mortgage banker.
Mortgage Banking Net Up a Bit
Earlier, Lomas said it was putting itself up for sale and had hired Salomon Brothers to help.
The company said its mortgage banking business was slightly profitable in the quarter, earning $209,000.
Putting its best foot forward, Lomas.used much of the narrative in its earnings release to stress these benefits from the decline in loan prepayments:
* A decline in its portfolio runoff rate to 29.3%, from 45.3% in the preceding quarter.
* A drop in interest expense to $4 million, from $6.5 million.
* The absence of any special amortization charges.