EXHIBIT 99.1
NEWS RELEASE FOR IMMEDIATE RELEASE | Contact: Income Opportunity Realty Investors, Inc. Investors Relations (800) 400-6407 investor.relations@primeasset.com |
Income Opportunity Realty Investors, Inc. Reports 2006 First Quarter Results
DALLAS (May 15, 2006) - Income Opportunity Realty Investors, Inc. (AMEX: IOT), a Dallas-based real estate investment company, today reported net income of $594,000 or $0.14 per share for the three months ended March 31, 2006, compared to $293,000 and $0.07 per share for the same period in 2005.
Key items for the three months ended March 31, 2006, compared to the same period in 2005 included:
· | Rents were $1.7 million in 2006 and $1.5 million in 2005. The increase is due to a combination of increased occupancy and rental increases. |
· | Operating expenses were $804,000 in 2006 and $821,000 in 2005. |
· | Interest income was $1.2 million in 2006 and $1 million in 2005. The increase is due to additional interest earned from additional notes receivable. |
· | Interest expense was $896,000 million in 2006 and $871,000 in 2005. The increase was primarily due to the additional debt incurred during 2005. |
· | Depreciation expense was $170,000 in 2006 and $177,000 in 2005. The decrease was due to the sale of properties in 2005 as well as fully depreciated tenant improvements in 2005. |
· | The advisory fee to affiliate was $174,000 in 2006 and $166,000 in 2005 due, primarily, to a net increase in gross assets, which is the basis of the advisory fee. The net income fee was $50,000 in 2006 as compared to $24,000 in 2005 and is based on 7½% of the Company’s net income. |
· | General and administrative expense was $150,000 in 2006 and $142,000 in 2005. |
Income Opportunity Realty Investors, Inc., a Dallas-based real estate investment company, holds a diverse portfolio of real estate properties located in Texas, including office buildings, apartments, and undeveloped land. For more information, go to IORI’s website at www.incomeopp-realty.com.
INCOME OPPORTUNITY REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, | |||||||
2006 | 2005 | ||||||
(unaudited) | |||||||
(amounts in thousands, except per share) | |||||||
Property revenue | |||||||
Rents and other property revenues | $ | 1,697 | $ | 1,529 | |||
Operating expenses | |||||||
Property operations | 804 | 821 | |||||
Depreciation | 170 | 177 | |||||
General and administrative | 150 | 142 | |||||
Advisory fee | 174 | 166 | |||||
Total operating expenses | 1,298 | 1,306 | |||||
Operating income | 399 | 223 | |||||
Other income (expense): | |||||||
Interest income | 1,154 | 974 | |||||
Mortgage and loan interest | (896 | ) | (871 | ) | |||
Net income fee | (50 | ) | (24 | ) | |||
Total other income (expense) | 208 | 79 | |||||
Income before equity in earnings of investees and minority interests | 607 | 302 | |||||
Equity in earnings (loss) of investees | — | (9 | ) | ||||
Minority interest | (13 | ) | — | ||||
Net income | $ | 594 | $ | 293 | |||
Earnings per share: | |||||||
Net earnings from continuing operations | $ | 0.14 | $ | 0.07 | |||
Weighted average common shares used in computing earnings per share | 4,168,035 | 4,168,035 |
Earnings per share reflect a 3-for-1 forward split of the stock in the form of a 200% stock dividend declared in May 2005.
INCOME OPPORTUNITY REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
March 31, 2006 | December 31, 2005 | ||||||
(dollars in thousands) | |||||||
Assets | |||||||
Real estate held for investment | $ | 38,870 | $ | 35,083 | |||
Less—accumulated depreciation | (4,481 | ) | (4,311 | ) | |||
34,389 | 30,772 | ||||||
Related party receivable (including accrued interest of $2,763 and $2,390 in 2006 and 2005, respectively) | 63,603 | 63,230 | |||||
Investment in real estate partnerships | 547 | 547 | |||||
Cash and cash equivalents | 167 | 201 | |||||
Due from affiliates | 160 | 1,853 | |||||
Other assets | 3,404 | 2,738 | |||||
$ | 102,270 | $ | 99,341 | ||||
Liabilities and Stockholders’ Equity | |||||||
Liabilities: | |||||||
Notes payable (including accrued interest of $172 in 2006 and $229 in 2005) | $ | 53,954 | $ | 52,817 | |||
Due to affiliates | 1,538 | — | |||||
Other liabilities | 991 | 1,344 | |||||
56,483 | 54,161 | ||||||
Commitments and contingencies | |||||||
Minority interest | 526 | 513 | |||||
Stockholders’ equity: | |||||||
Common Stock, $.01 par value; authorized, 100,000,000 shares; issued and outstanding 4,168,035 at March 31, 2006 and December 31, 2005 | 42 | 42 | |||||
Additional paid-in capital | 61,955 | 61,955 | |||||
Accumulated deficit | (16,736 | ) | (17,330 | ) | |||
45,261 | 44,667 | ||||||
$ | 102,270 | $ | 99,341 |