![](https://capedge.com/proxy/8-K/0001010549-14-000270/ex991p1.jpg)
TRANSCONTINENTAL REALTY INVESTORS, INC. | ||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(unaudited) | ||||||||
For the Three Months Ended | ||||||||
March 31, | ||||||||
2014 | 2013 | |||||||
(dollars in thousands, except per share amounts) | ||||||||
Revenues: | ||||||||
Rental and other property revenues (including $175 and $165 for the three months ended 2014 and 2013, respectively, from related parties) | $ | 19,727 | $ | 19,505 | ||||
Expenses: | ||||||||
Property operating expenses (including $146 and $194 for the three months ended 2014 and 2013, respectively, from related parties) | 9,592 | 9,389 | ||||||
Depreciation and amortization | 4,444 | 3,733 | ||||||
General and administrative (including $744 and $648 for the three months ended 2014 and 2013, respectively, from related parties) | 1,560 | 1,622 | ||||||
Provision on impairment of notes receivable and real estate assets | - | - | ||||||
Net income fee to related party | 490 | 56 | ||||||
Advisory fee to related party | 1,852 | 2,138 | ||||||
Total operating expenses | 17,938 | 16,938 | ||||||
Net operating income | 1,789 | 2,567 | ||||||
Other income (expenses): | ||||||||
Interest income (including $1,874 and $2,140 for the three months ended 2014 and 2013, respectively, from related parties) | 2,113 | 2,176 | ||||||
Other income | 157 | 36 | ||||||
Mortgage and loan interest (including $31 and $487 for the three months ended 2014 and 2013, respectively, from related parties) | (6,841 | ) | (7,933 | ) | ||||
Deferred borrowing costs amortization | (932 | ) | (2,416 | ) | ||||
Loan charges and prepayment penalties | (1,582 | ) | (3,937 | ) | ||||
Loss on the sale of investments | - | (7 | ) | |||||
Losses from unconsolidated joint ventures and investees | (4 | ) | (13 | ) | ||||
Litigation settlement | 3,839 | (45 | ) | |||||
Total other expenses | (3,250 | ) | (12,139 | ) | ||||
Loss before gain on land sales, non-controlling interest, and taxes | (1,461 | ) | (9,572 | ) | ||||
Gain (loss) on land sales | 753 | (48 | ) | |||||
Net loss from continuing operations before taxes | (708 | ) | (9,620 | ) | ||||
Income tax benefit | 1,870 | 2,318 | ||||||
Net income (loss) from continuing operations | 1,162 | (7,302 | ) | |||||
Discontinued operations: | ||||||||
Net income (loss) from discontinued operations | (710 | ) | 432 | |||||
Gain on sale of real estate from discontinued operations | 6,053 | 6,190 | ||||||
Income tax expense from discontinued operations | (1,870 | ) | (2,318 | ) | ||||
Net income from discontinued operations | 3,473 | 4,304 | ||||||
Net income (loss) | 4,635 | (2,998 | ) | |||||
Net loss attributable to non-controlling interest | (84 | ) | (111 | ) | ||||
Net income (loss) attributable to Transcontinental Realty Investors, Inc. | 4,551 | (3,109 | ) | |||||
Preferred dividend requirement | (274 | ) | (274 | ) | ||||
Net income (loss) applicable to common shares | $ | 4,277 | $ | (3,383 | ) | |||
Earnings per share - basic | ||||||||
Net income (loss) from continuing operations | $ | 0.10 | $ | (0.91 | ) | |||
Net income from discontinued operations | 0.41 | 0.51 | ||||||
Net income (loss) applicable to common shares | $ | 0.51 | $ | (0.40 | ) | |||
Earnings per share - diluted | ||||||||
Net income (loss) from continuing operations | $ | 0.09 | $ | (0.91 | ) | |||
Net income from discontinued operations | 0.40 | 0.51 | ||||||
Net income (loss) applicable to common shares | $ | 0.49 | $ | (0.40 | ) | |||
Weighted average common shares used in computing earnings per share | 8,413,469 | 8,413,469 | ||||||
Weighted average common shares used in computing diluted earnings per share | 8,639,679 | 8,413,469 | ||||||
Amounts attributable to Transcontinental Realty Investors, Inc. | ||||||||
Net income (loss) from continuing operations | $ | 1,078 | $ | (7,413 | ) | |||
Net income from discontinued operations | 3,473 | 4,304 | ||||||
Net income (loss) | $ | 4,551 | $ | (3,109 | ) |
TRANSCONTINENTAL REALTY INVESTORS, INC. | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
(unaudited) | ||||||||
March 31, | December 31, | |||||||
2014 | 2013 | |||||||
(dollars in thousands, except share and par value amounts) | ||||||||
Assets | ||||||||
Real estate, at cost | $ | 742,995 | $ | 777,974 | ||||
Real estate held for sale at cost, net of depreciation ($28,033 for 2014 and $2,390 for 2013) | 11,945 | 16,427 | ||||||
Real estate subject to sales contracts at cost, net of depreciation ($2,036 for 2014 and $1,949 for 2013) | 25,090 | 29,353 | ||||||
Less accumulated depreciation | (104,212 | ) | (127,952 | ) | ||||
Total real estate | 675,818 | 695,802 | ||||||
Notes and interest receivable: | ||||||||
Performing (including $60,221 in 2014 and $66,431 in 2013 from related parties) | 63,479 | 69,626 | ||||||
Non-performing | 552 | 543 | ||||||
Less allowance for doubtful accounts (including $2,098 in 2014 and $2,098 in 2013 from related parties) | (2,262 | ) | (2,262 | ) | ||||
Total notes and interest receivable | 61,769 | 67,907 | ||||||
Cash and cash equivalents | 18,177 | 16,086 | ||||||
Restricted cash | 27,185 | 31,799 | ||||||
Investments in unconsolidated joint ventures and investees | 1,824 | 1,697 | ||||||
Receivable from related party | 80,139 | 52,380 | ||||||
Other assets | 35,492 | 32,000 | ||||||
Total assets | $ | 900,404 | $ | 897,671 | ||||
Liabilities and Shareholders’ Equity | ||||||||
Liabilities: | ||||||||
Notes and interest payable | $ | 578,133 | $ | 562,734 | ||||
Notes related to real estate held for sale | 15,717 | 17,100 | ||||||
Notes related to real estate subject to sales contracts | 20,991 | 23,011 | ||||||
Deferred gain (from sales to related parties) | 53,096 | 53,096 | ||||||
Accounts payable and other liabilities (including $4,893 in 2014 and $4,697 in 2013 to related parties) | 36,536 | 50,160 | ||||||
Total liabilities | 704,473 | 706,101 | ||||||
Shareholders’ equity: | ||||||||
Preferred stock, Series C: $0.01 par value, authorized 10,000,000 shares, issued and outstanding 30,000 shares in 2014 and 2013 (liquidation preference $100 per share). Series D: $0.01 par value, authorized, issued and outstanding 100,000 shares in 2013 and 2012 (liquidation preference $100 per share) | 1 | 1 | ||||||
Common stock, $0.01 par value, authorized 10,000,000 shares, issued 8,413,669 shares in 2014 and 2013 and outstanding 8,413,469 shares in 2014 and 2013 | 84 | 84 | ||||||
Treasury stock at cost, 200 shares in 2014 and 2013 | (2 | ) | (2 | ) | ||||
Paid-in capital | 271,446 | 271,720 | ||||||
Retained earnings | (93,478 | ) | (98,029 | ) | ||||
Total Transcontinental Realty Investors, Inc. shareholders' equity | 178,051 | 173,774 | ||||||
Non-controlling interest | 17,880 | 17,796 | ||||||
Total shareholders' equity | 195,931 | 191,570 | ||||||
Total liabilities and shareholders' equity | $ | 900,404 | $ | 897,671 |