Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 11, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | PGI INC | |
Entity Central Index Key | 81,157 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 5,317,758 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,018 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash | $ 683 | $ 159 |
Receivables-related party | 0 | 573 |
Land inventory | 14 | 14 |
Restricted sinking fund | 41 | 41 |
Other assets | 1 | 1 |
Total Assets | 739 | 788 |
LIABILITIES | ||
Accounts payable and accrued expenses | 193 | 209 |
Accrued real estate taxes | 1 | 4 |
Accrued interest: | ||
Subordinated convertible debentures payable | 25,358 | 25,032 |
Convertible debentures payable-related party | 52,915 | 52,915 |
Notes payable | 3,237 | 3,218 |
Credit agreements: | ||
Notes payable | 1,198 | 1,198 |
Subordinated convertible debentures payable | 8,472 | 8,472 |
Total Liabilities | 91,374 | 91,048 |
STOCKHOLDERS' DEFICIENCY | ||
Preferred stock, par value $1.00 per share; authorized 5,000,000 shares; 2,000,000 Class A cumulative convertible shares issued and outstanding; (liquidation preference of $8,000 plus unpaid cumulative dividends of $14,675) | 2,000 | 2,000 |
Common stock, par value $.10 per share; authorized 25,000,000 shares; 5,317,758 shares issued and outstanding | 532 | 532 |
Paid-in capital | 13,498 | 13,498 |
Accumulated deficit | (106,665) | (106,290) |
Total stockholders' deficit | (90,635) | (90,260) |
Total liabilities and stockholders' deficit | $ 739 | $ 788 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
STOCKHOLDERS' DEFICIENCY | ||
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock - Class A cumulative convertible shares, issued | 2,000,000 | 2,000,000 |
Preferred stock, liquidation preference (excluding cumulative dividends) | $ 8,000 | $ 8,000 |
Preferred stock, unpaid dividends | $ 14,675 | |
Common stock, par value | $ .10 | $ .10 |
Common stock, authorized | 25,000,000 | 25,000,000 |
Common stock, issued | 5,317,758 | 5,317,758 |
Common stock, outstanding | 5,317,758 | 5,317,758 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
REVENUES | ||
Interest income | $ 1 | $ 1 |
Interest income-related party | 4 | 0 |
Total Revenues | 5 | 1 |
COSTS, EXPENSES AND OTHER | ||
Interest | 345 | 336 |
Taxes and assessments | 1 | 1 |
Consulting and accounting-related party | 9 | 10 |
Legal and professional | 4 | 21 |
General and administrative | 21 | 25 |
Total costs and expenses | 380 | 393 |
Net Loss before income taxes | (375) | (392) |
Income tax expense | 0 | (57) |
NET INCOME (LOSS) | $ (375) | $ (449) |
NET LOSS PER SHARE(*) AVAILABLE TO COMMON STOCKHOLDERS-Basic and diluted | $ (0.10) | $ (0.11) |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Cash Flows [Abstract] | ||
Net cash used in operating activities | $ (36) | $ (64) |
Cash flows from investing activities: | ||
Payments received on notes receivable-related party | 560 | 0 |
Net cash provided by (used in) investing activities | 560 | 0 |
Net change in cash | 524 | (64) |
Cash at beginning of period | 159 | 958 |
Cash at end of period | $ 683 | $ 894 |
1. Basis of Presentation
1. Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements of PGI Incorporated (“PGI”) and its subsidiaries (the “Company”) have been prepared in accordance with the instructions to Form 10 - Q and therefore do not include all disclosures necessary for fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. The Company's independent registered public accounting firm included an explanatory paragraph regarding the Company's ability to continue as a going concern in their opinion on the Company's consolidated financial statements for the year ended December 31, 2017. The Company was founded in 1958, and up until the mid 1990’s was in the business of building and selling homes, developing and selling home sites and selling undeveloped or partially developed tracts of land. Over approximately the last 25 years, the Company’s business focus and emphasis changed substantially as it has concentrated its sales and marketing efforts almost exclusively on the disposition of its remaining real estate. The Company’s major efforts and activities have been, and continue to be, to sell assets of the Company, to repay its indebtedness, and to pay the ordinary on-going costs of operation of the Company. The potential values of the land parcels held for sale has been difficult to assess. While the Company will seek to realize full market value for each remaining asset, the amounts realized may be at substantial variance from its present financial statement carrying value. Certain of these assets may be of so little value and marketability that the Company may elect not to pay the real estate taxes on selected parcels, which may eventually result in a defacto liquidation of such property by subjecting such property to a tax sale. In management’s judgement, the remaining assets will be insufficient to satisfy much, if any, of the outstanding indebtedness and there will be no recoveries by the shareholders. Consequently, there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. Certain information and note disclosures normally included in the Company’s annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K annual report for 2017 filed with the Securities and Exchange Commission. The condensed consolidated statement of financial position of the Company as of December 31, 2017 has been derived from the audited consolidated statement of financial position as of that date. The Company remains in default under the indentures governing its unsecured subordinated debentures. (See Management's Discussion and Analysis of Financial Condition and Results of Operations and Notes 7, 8, and 9 to the Company's consolidated financial statements for the year ended December 31, 2017, as contained in the Company's Annual Report on Form 10 - K). All adjustments (consisting of only normal recurring accruals) necessary for fair presentation of financial position, results of operations and cash flows have been made. The results for the three months ended March 31, 2018 are not necessarily indicative of operations to be expected for the fiscal year ending December 31, 2018 or any other interim period. |
2. Per Share Data
2. Per Share Data | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Per Share Data | Basic per share amounts are computed by dividing net income (loss), after deducting current period dividends on the Company's preferred stock, by the weighted average number of common shares outstanding during the period. The weighted average number of common shares outstanding for the three months ended March 31, 2018 and 2017 was 5,317,758. Diluted per share amounts are computed by dividing net income (loss) attributable to common shareholders by the weighted average number of common shares outstanding, after adjusting for the estimated effect of the assumed conversion of all cumulative convertible preferred stock and outstanding convertible debentures, if dilutive, into shares of common stock. For the three months ended March 31, 2018 and 2017, the assumed conversion of all outstanding convertible preferred stock and collateralized convertible debentures would have been anti-dilutive. The following is a summary of the calculations used in computing basic and diluted loss per share for the three months ended March 31, 2018 and 2017. Three Months Ended March 31, March 31, 2018 2017 ($ in thousands, except share and per share data) Net Loss $ (375 ) $ (449 ) Preferred dividends (160 ) (160 ) Loss Available to $ (535 ) $ (609 ) Common shareholders Weighted Average Number Of Common Shares Outstanding 5,317,758 5,317,758 Basic and Diluted Loss Per Common Share $ (0.10 ) $ (0.11 ) |
3. Statement of Cash Flows
3. Statement of Cash Flows | 3 Months Ended |
Mar. 31, 2018 | |
Statement of Cash Flows [Abstract] | |
Statement of Cash Flows | The Financial Accounting Standards Board Accounting Standards Codification Topic No. 230, “Statement of Cash Flows”, requires a statement of cash flows as part of a full set of financial statements. For quarterly reporting purposes, the Company has elected to condense the reporting of its net cash flows. There were no payments of interest for the three month periods ended March 31, 2018 and March 31, 2017. |
4. Receivables
4. Receivables | 3 Months Ended |
Mar. 31, 2018 | |
Receivables [Abstract] | |
Receivables | Receivables consisted of: March 31, December 31, 2018 2017 ($ in thousands) Note receivable-related party $ - $ 560 Interest receivable-related party - 13 $ - $ 573 |
5. Land Inventory
5. Land Inventory | 3 Months Ended |
Mar. 31, 2018 | |
Real Estate [Abstract] | |
Land Inventory | Land inventory consisted of March 31, December 31, 2018 2017 ($ in thousands) Fully improved land $ 14 $ 14 |
6. Accounts Payable and Accrued
6. Accounts Payable and Accrued Expenses | 3 Months Ended |
Mar. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of: March 31, December 31, 2018 2017 ($ in thousands) Accounts payable $ 3 $ 15 Accrued audit & professional 39 47 Accrued legal 2 - Accrued consulting fees-related party 1 1 Accrued debenture fees 147 145 Accrued miscellaneous 1 1 $ 193 $ 209 Accrued real estate taxes consisted of: Current real estate taxes $ 1 $ 4 |
7. Credit Agreements, Notes Pay
7. Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable | 3 Months Ended |
Mar. 31, 2018 | |
Credit Agreements Notes Payable Subordinated And Convertible Debentures Payable | |
Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable | Credit agreements consisted of the following: March 31, December 31, 2018 2017 ($ in thousands) Notes payable - $1,176,000 bearing interest at prime plus 2%, the remainder non-interest bearing, all past due $ 1,198 $ 1,198 Subordinated convertible debentures payable: At 6.5% interest; due June 1991 447 447 At 6% interest; due May 1992 8,025 8,025 8,472 8,472 $ 9,670 $ 9,670 The Trustee of the 6.5% subordinated convertible debentures, which matured in June, 1991, with an original face amount of $1,034,000, provided notice of final distribution to holders of such debentures on September 2, 2014. In connection with such final distribution, the Trustee has maintained a debenture reserve fund with a balance of $41,000 as of March 31, 2018 and December 31, 2017, available for final distribution to holders of such debentures who surrender their respective debenture certificates. During the three month period ended March 31, 2018 and during the year ended December 31, 2017, there were no 6.5% subordinated convertible debentures that were surrendered by their respective debenture holders and no funds were utilized from the debenture reserve account. As of March 31, 2018 and December 31, 2017 the outstanding principal balance on such 6.5% subordinated convertible debentures that were not surrendered by the respective holders equals $447,000 plus accrued and unpaid interest of $853,000 and $846,000, respectively. If and when such remaining debentures are surrendered to the Trustee, the applicable portion of such principal and accrued interest will be recorded as debt and accrued interest forgiveness. As the Company has consistently stated in prior filings, the Company believes that any potential claims by the respective debenture holders on such 6.5% subordinated convertible debentures would be barred under the applicable statutes of limitations. |
8. Income Taxes
8. Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income tax expense of $57,000 was recognized during the three month period March 31, 2017 for the estimated 2016 Alternative Minimum Tax on the 2016 gain on sales of real estate. At December 31, 2017, the Company had an operating loss carryforward of approximately $68,129,000 available to reduce future taxable income. These operating losses expire at various dates through 2036. The following summarizes the temporary differences of the Company at March 31, 2018 and December 31, 2017 at the statutory rate: March 31, December 31, 2018 2017 ($ in thousands) Deferred tax asset Net operating loss carryforward $ 17,042 $ 16,948 Expenses capitalized under IRC 263(a) 37 37 Tax credits (AMT) 57 57 Valuation allowance (17,136 ) (17,042 ) Total deferred tax asset $ - $ - |
9. Fair Value of Financial Inst
9. Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Fair Value of Financial Instruments | The carrying amount of the Company’s financial instruments, other than debt, approximates fair value at March 31, 2018 and December 31, 2017 because of the short maturity of those instruments. It was not practicable to estimate the fair value of the Company’s notes payable and its convertible debentures because these debts are in default causing no basis for estimating value by reference to quoted market prices or current rates offered to the Company for debt of the same remaining maturities. |
2. Per Share Data (Tables)
2. Per Share Data (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Summary of the calculations used in computing basic and diluted loss per share | Three Months Ended March 31, March 31, 2018 2017 ($ in thousands, except share and per share data) Net Loss $ (375 ) $ (449 ) Preferred dividends (160 ) (160 ) Loss Available to $ (535 ) $ (609 ) Common shareholders Weighted Average Number Of Common Shares Outstanding 5,317,758 5,317,758 Basic and Diluted Loss Per Common Share $ (0.10 ) $ (0.11 ) |
4. Receivables (Tables)
4. Receivables (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Receivables Tables | |
Net receivables | March 31, December 31, 2018 2017 ($ in thousands) Note receivable-related party $ - $ 560 Interest receivable-related party - 13 $ - $ 573 |
5. Land Inventory (Tables)
5. Land Inventory (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Real Estate [Abstract] | |
Land and improvement inventories | March 31, December 31, 2018 2017 ($ in thousands) Fully improved land $ 14 $ 14 |
6. Accounts Payable and Accru18
6. Accounts Payable and Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued expenses | March 31, December 31, 2018 2017 ($ in thousands) Accounts payable $ 3 $ 15 Accrued audit & professional 39 47 Accrued legal 2 - Accrued consulting fees-related party 1 1 Accrued debenture fees 147 145 Accrued miscellaneous 1 1 $ 193 $ 209 Accrued real estate taxes consisted of: Current real estate taxes $ 1 $ 4 |
7. Credit Agreements, Notes P19
7. Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Credit Agreements Notes Payable Subordinated And Convertible Debentures Payable | |
Credit agreements with the Company | March 31, December 31, 2018 2017 ($ in thousands) Notes payable - $1,176,000 bearing interest at prime plus 2%, the remainder non-interest bearing, all past due $ 1,198 $ 1,198 Subordinated convertible debentures payable: At 6.5% interest; due June 1991 447 447 At 6% interest; due May 1992 8,025 8,025 8,472 8,472 $ 9,670 $ 9,670 |
8. Income Taxes (Tables)
8. Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Summary of the temporary differences | March 31, December 31, 2018 2017 ($ in thousands) Deferred tax asset Net operating loss carryforward $ 17,042 $ 16,948 Expenses capitalized under IRC 263(a) 37 37 Tax credits (AMT) 57 57 Valuation allowance (17,136 ) (17,042 ) Total deferred tax asset $ - $ - |
2. Per Share Data (Details)
2. Per Share Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Basic and Diluted loss per share | ||
Net Loss | $ (375) | $ (449) |
Preferred Dividends | (160) | (160) |
Loss Available to Common shareholders | $ (535) | $ (609) |
Weighted Average Number Of Common Shares Outstanding | 5,317,758 | 5,317,758 |
Basic and Diluted Loss Per Common Share | $ (0.10) | $ (0.11) |
2. Per Share Data (Details Narr
2. Per Share Data (Details Narrative) - shares | Mar. 31, 2018 | Dec. 31, 2017 |
Per Share Data Details Narrative | ||
Common shares outstanding | 5,317,758 | 5,317,758 |
4. Receivables (Details)
4. Receivables (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Receivables Details | ||
Note receivable-related party | $ 0 | $ 560 |
Interest receivable - related party | 0 | 13 |
Receivables related party, total | $ 0 | $ 573 |
5. Land Inventory (Details)
5. Land Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Land Inventory Details | ||
Fully improved land | $ 14 | $ 14 |
6. Accounts Payable and Accru25
6. Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Accounts payable and accrued expenses | ||
Accounts payable | $ 3 | $ 15 |
Accrued audit & professional | 39 | 47 |
Accrued legal | 2 | 0 |
Accrued consulting fees-related party | 1 | 1 |
Accrued debenture fees | 147 | 145 |
Accrued miscellaneous | 1 | 1 |
Total | 193 | 209 |
Accrued real estate taxes consisted of: | ||
Current real estate taxes | $ 1 | $ 4 |
7. Credit Agreements, Notes P26
7. Credit Agreements, Notes Payable, Subordinated and Convertible Debentures Payable (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Credit Agreements Notes Payable Subordinated And Convertible Debentures Payable | ||
Notes payable - $1,176,000 bearing interest at prime plus 2%, the remainder non-interest bearing, all past due | $ 1,198 | $ 1,198 |
Subordinated debentures payable: | ||
At 6.5% interest; due June 1991 | 447 | 447 |
At 6% interest; due May 1992 | 8,025 | 8,025 |
Subordinated convertible debentures payable | 8,472 | 8,472 |
Total | $ 9,670 | $ 9,670 |
8. Income Taxes (Details)
8. Income Taxes (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Deferred tax asset: | ||
Net operating loss carryforward | $ 17,042 | $ 16,948 |
Expenses capitalized under IRC 263(a) | 37 | 37 |
Environmental liability | 57 | 57 |
Valuation allowance | (17,136) | (17,042) |
Total deferred tax asset | $ 0 | $ 0 |
8. Income Taxes (Details Narrat
8. Income Taxes (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Income Taxes Details Narrative | |
Operating loss carryforward | $ 68,129 |
Operating losses expire date | 2,036 |