Exhibit 99.1
NEWS RELEASE | ||
FOR IMMEDIATE RELEASE | Contact: | |
Transcontinental Realty Investors, Inc. | ||
Investors Relations | ||
(800) 400-6407 | ||
investor.relations@primeasset.com |
Transcontinental Realty Investors, Inc. Reports First Quarter 2009 Results
DALLAS (May 15, 2009) — Transcontinental Realty Investors, Inc. (NYSE: TCI), a Dallas-based real estate investment company, today reported results of operations for the first quarter ended March 31, 2009. TCI announced today that the company reported a net loss applicable to common shares of ($ 11.0 million) or ($1.37) per diluted earnings per share which includes a gain on sale of discontinued operations of $0.5 million, as compared to a net income of $67.1 million or $8.07 per diluted earnings per share which includes a gain on sale of discontinued operations of $98.1 million for the same period ended 2008.
Results of operations for the three months ended March 31, 2009, as compared to the same period ended 2008.
Rental and other property revenues increased by $4.7 million as compared to the prior period which by segment is an increase in the apartment portfolio of $2.7 million, the commercial portfolio of $2.5 million, offset by a decrease in the land and other portfolio of $0.5 million.
Property operating expenses increased by $2.1 million as compared to the prior period which by segment is an increase in the apartment portfolio of $3.9 million and an increase in the other portfolio of $0.1 million, offset by decreases in the commercial and land portfolios of $0.8 million and $1.1 million, respectively.
Depreciation and amortization increased by $1.4 million as compared to the prior period which by segment is an increase in the apartment portfolio of $1.0 million, and an increase in the commercial portfolio of $0.4 million.
Other income increased by $3.6 million as compared to the prior period. The increase is due to $2.3 million for gains on the disposition of our investment in the Korean REIT. In addition, we received $0.8 million in litigation settlements and $0.5 million in other non-recurring income.
Mortgage and loan interest expense decreased by $1.1 million as compared to the prior period which by segment is a decrease in the apartment portfolio of $0.4 million, a decrease in the commercial portfolio of $0.4 million, and a decrease in the other portfolio of $0.3 million.
Earnings from unconsolidated subsidiaries and investees decreased by $5.1 million. There were no material amounts of equity pickup from investees in the current period.
Provision for allowance on notes receivables and impairment decreased by $6.6 million. The majority of the prior period amount was due to setting up an allowance for various investments within our portfolio.
Gain on land sales decreased by $1.5 million as compared to the prior period. The decrease was due to recording a loss of $0.3 million on the sale of 0.3 acres of land known as West End land in the current period. In the prior quarter, we sold 14 acres of land for a gain of $1.3 million.
The 2009 discontinued operations consist of the Cullman Shopping Center that was sold subsequent to the quarter ended March 31, 2009. In addition, we recognized the deferred gain on the sale of the Hartford building sold in 2002. Discontinued operations for 2008 relates to 26 income producing properties of which 25 were sold in 2008.
About Transcontinental Realty Investors, Inc.
Transcontinental Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of equity real estate located across the U.S., including office buildings, apartments, hotels, shopping centers and developed and undeveloped land. We invest in real estate through direct equity ownership and partnerships nationwide. For more information, visit the Company’s web siteat
www.transconrealty-invest.com.
www.transconrealty-invest.com.
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
For the Three Months Ended | ||||||||
March 31, | ||||||||
2009 | 2008 | |||||||
(dollars in thousands, except | ||||||||
share and per share amounts) | ||||||||
Revenues: | ||||||||
Rental and other property revenues | $ | 37,371 | $ | 32,647 | ||||
Expenses: | ||||||||
Property operating expenses | 24,072 | 21,938 | ||||||
Depreciation and amortization | 7,308 | 5,932 | ||||||
General and administrative | 1,563 | 2,403 | ||||||
Advisory fee to affiliate | 2,857 | 2,997 | ||||||
Total operating expenses | 35,800 | 33,270 | ||||||
Operating income (loss) | 1,571 | (623 | ) | |||||
Other income (expense): | ||||||||
Interest income | 636 | 763 | ||||||
Other income | 3,906 | 302 | ||||||
Mortgage and loan interest | (16,629 | ) | (17,734 | ) | ||||
Earnings from unconsolidated subsidiaries and investees | — | 5,112 | ||||||
Provision for allowance on notes receivable and impairment | (379 | ) | (7,000 | ) | ||||
Total other expenses | (12,466 | ) | (18,557 | ) | ||||
Loss before gain on land sales, non-controlling interest, and tax | (10,895 | ) | (19,180 | ) | ||||
Gain (loss) on land sales | (251 | ) | 1,275 | |||||
Loss from continuing operations before tax | (11,146 | ) | (17,905 | ) | ||||
Income tax benefit (expense) | (110 | ) | 29,836 | |||||
Net income (loss) from continuing operations | (11,256 | ) | 11,931 | |||||
Discontinued operations: | ||||||||
Income (loss) from discontinued operations | 65 | (12,813 | ) | |||||
Gain on sale of real estate from discontinued operations | 532 | 98,059 | ||||||
Income tax expense from discontinued operations | (209 | ) | (29,836 | ) | ||||
Net income (loss) | (10,868 | ) | 67,341 | |||||
Less: net income attributable to non-controlling interest | 109 | — | ||||||
Net income (loss) attributable to Transcontinental Realty Investors, Inc. | (10,759 | ) | 67,341 | |||||
Preferred dividend requirement | (250 | ) | (240 | ) | ||||
Net income (loss) applicable to common shares | $ | (11,009 | ) | �� | $ | 67,101 | ||
Earnings per share — basic | ||||||||
Income (loss) from continuing operations | $ | (1.42 | ) | $ | 1.45 | |||
Discontinued operations | 0.05 | 6.86 | ||||||
Net income (loss) applicable to common shares | $ | (1.37 | ) | $ | 8.31 | |||
Earnings per share — diluted | ||||||||
Income (loss) from continuing operations | $ | (1.42 | ) | $ | 1.41 | |||
Discontinued operations | 0.05 | 6.66 | ||||||
Net income (loss) applicable to common shares | $ | (1.37 | ) | $ | 8.07 | |||
Weighted average common share used in computing earnings per share | 8,113,669 | 8,075,453 | ||||||
Weighted average common share used in computing diluted earnings per share | 8,113,669 | 8,311,693 | ||||||
Amounts attributable to Transcontinental Realty Investors, Inc. | ||||||||
Income (loss) from continuing operations | $ | (11,147 | ) | $ | 11,931 | |||
Income from discontinued operations | 388 | 55,410 | ||||||
Net income (loss) | $ | (10,759 | ) | $ | 67,341 | |||
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
CONSOLIDATED BALANCE SHEETS
(unaudited)
March 31, | December 31, | |||||||
2009 | 2008 | |||||||
(dollars in thousands, except share and | ||||||||
par value amounts) | ||||||||
Assets | ||||||||
Real estate, at cost | $ | 1,531,183 | $ | 1,526,016 | ||||
Real estate held for sale, at cost net of depreciation | 4,291 | 8,018 | ||||||
Real estate subject to sales contracts, at cost net of depreciation | 60,367 | 60,807 | ||||||
Less accumulated depreciation | (120,553 | ) | (114,050 | ) | ||||
Total real estate | 1,475,288 | 1,480,791 | ||||||
Notes and interest receivable , Performing | 34,896 | 42,413 | ||||||
Less allowance for estimated losses | (988 | ) | (3,293 | ) | ||||
Total notes and interest receivable | 33,908 | 39,120 | ||||||
Cash and cash equivalents | 2,150 | 5,983 | ||||||
Investments in securities | — | 2,775 | ||||||
Investments in unconsolidated subsidiaries and investees | 23,446 | 23,365 | ||||||
Other assets | 81,684 | 88,033 | ||||||
Total assets | $ | 1,616,476 | $ | 1,640,067 | ||||
Liabilities and Shareholders’ Equity | ||||||||
Liabilities: | ||||||||
Notes and interest payable | $ | 1,106,715 | $ | 1,100,852 | ||||
Notes related to assets held-for-sale | 993 | 4,191 | ||||||
Notes related to subject to sales contracts | 62,287 | 62,972 | ||||||
Accounts payable and other liabilities | 135,535 | 147,356 | ||||||
1,305,530 | 1,315,371 | |||||||
Commitments and contingencies: | ||||||||
Shareholders’ equity: | ||||||||
Preferred Stock, Series C: $.01 par value, authorized 10,000,000 shares, issued and outstanding 30,000 shares in 2009 and 2008 respectively (liquidation preference $100 per share). Series D: $.01 par value, authorized, issued and outstanding 100,000 shares in 2009 and 2008 respectively | 1 | 1 | ||||||
Common Stock, $.01 par value, authorized 10,000,000 shares; issued and outstanding 8,113,669 for 2009 and 2008 | 81 | 81 | ||||||
Paid-in capital | 262,983 | 263,290 | ||||||
Retained earnings | 34,221 | 44,980 | ||||||
Accumulated other comprehensive income | — | 2,575 | ||||||
Total Transcontinental Realty Investors, Inc. shareholders’ equity | 297,286 | 310,927 | ||||||
Non-controlling interest | 13,660 | 13,769 | ||||||
Total equity | 310,946 | 324,696 | ||||||
Total liabilities and equity | $ | 1,616,476 | $ | 1,640,067 | ||||