______________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
____________
For the quarter ended September 30, 1995. Commission File Number 0-9231
ALASKA NORTHWEST PROPERTIES INC.
(Exact name of registrant as specified in its charter)
Alaska 92-0035034
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23830 PACIFIC HIGHWAY S., SUITE 300 #3, SEATTLE, WA 98032
(Address of principal executive offices)
Registrant's telephone number, including area code: (206) 433-0730
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
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The company had 29,088 common shares, par value $1.00, outstanding at September
30, 1995.
______________________________________________________________________________
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Attached are the following Alaska Northwest Properties Inc.(ANPI) unaudited
financial statements: (1) Balance sheet as of September 30, 1995 and December
31, 1994; (2) Statements of operations for the three months ended September 30,
1995 and 1994; (3) Statements of operations for the nine months ended September
30, 1995 and 1994; (4) Statements of shareholders' equity for the nine months
ended September 30, 1995; and (5) Statements of cash flows for the nine months
ended September 30, 1995 and 1994. Also attached are certain disclosures to
ANPI's financial statements for the nine months ended September 30, 1995. The
financial statements include all adjustments which are, in the opinion of
management, necessary to present the results fairly for the interim period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
FINANCIAL CONDITION
The Company experienced no significant changes in financial condition during the
third quarter of 1995. A portion of the collateral on the $705,188, 8.5% note
receivable was destroyed in a fire in Fairbanks, Alaska. Management has
initiated negotiations with the debtor on whether to apply the insurance
proceeds to reconstruct the collateral or to reduce the mortgage. The Company
is covered sufficiently for any anticipated loss to the property.
In a subsequent event occurring after the third quarter of 1995, management has
reached an agreement with the State of Alaska Department of Transportation (DOT)
on the cash sale of a portion of a large parcel of commercial property owned by
the Company. The agreement to sell 14,142 square feet of the Bunnell Park
Acreage for $51,000, a pre-tax gain of approximately $25,500, should provide
better access and enhance the value of the property.
In the second quarter of 1995, the Company sold three residential lots located
in Fairbanks, Alaska. Two lots were sold to a general contractor for $24,000,
resulting in a pre-tax gain of $9,087. Included in the purchase price was a
$9,000, 10% note receivable that was was paid-in-full, September 15, 1995, under
the terms. In a separate transaction, a residential lot was sold to a private
party in Fairbanks, Alaska for $24,000, resulting in a pre-tax gain of $3,184.
RESULTS OF OPERATIONS
For the quarter ended September 30, 1995, a net loss of $95,782 was
recognized by the Company, as compared to a net loss of $15,424 for the same
period in 1994. There were no real estate sales in the third quarter of 1995.
However, the Company recognized a gain of $4,560, based on the installment
method in accordance with FAS 66. This installment gain occurred as a result
of the sale of operating properties in Fairbanks, Alaska, during the fourth
quarter of 1993. The Company did not realize a gain or loss on the sale of
real estate in the third quarter of 1994.
1
For the three months ended September 30, 1995, total revenues decreased
approximately $33,000 from the same period of the previous year. Rental revenue
for the third quarter of 1995 has remained relatively consistant with the same
period of 1994. However, interest income decreased approximately $19,000 in the
third quarter of 1995 over the same period of the prior year. This is the
result of a timing difference on note payments received between the second and
third quarters of 1995. Another contributing factor to this difference is a
change in reporting on the $705,188 note receivable from the cash basis to the
cost recovery method in accordance with FAS 66.
Cost and Expenses for the quarter ended September 30, 1995, decreased $9,000
compared to the same quarter in 1994. Operating expenses were down
approximately $5,000 from the prior year. This slight decrease is primarily due
to a reduction in property taxes and depreciation. General and administrative
expenses decreased $3,000 from the previous year, the result of a decrease in
auditing and professional fees. Interest expense remained fairly consistent
with the same period of 1994.
In the third quarter of 1995, a loss of $116,800 was realized from the sale of
securities, commodities and futures trading. This is compared to a $14,892 gain
in the third quarter of the previous year. The Company saw a net unrealized
appreciation of $65,282 on other assets marked to market from the prior quarter
ended June 30, 1995. However, other assets market to marked have produced a net
unrealized depreciation of $91,781 for the nine months ended September 30, 1995.
Through the same quarter of the previous year, there was a net unrealized
appreciation of $50,300. This decrease is primarily due to a decline in
precious metals prices over the past year.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) No exhibits have been filed herewith.
(b) No Form 8-K reports were filed during the third quarter of 1995.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
ALASKA NORTHWEST PROPERTIES INC.
(REGISTRANT)
Date: November 13, 1995 /s/ Michael W. Shimasaki
------------------------
Michael W. Shimasaki
President and Treasurer, Director and
Principal Financial Officer
2
ALASKA NORTHWEST PROPERTIES INC.
BALANCE SHEETS (UNAUDITED)
(amounts in thousands except # of shares)
ASSETS 9/30/95 12/31/94
- ------------------------------------------------------------------------------------------
OPERATING PROPERTY AND EQUIPMENT, at cost:
Land and land improvements $ 393 $ 393
Buildings 1,318 1,292
Furniture, fixtures and equipment 217 245
Leasehold costs and other 218 218
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2,146 2,148
Less accumulated depreciation and amortization (1,316) (1,284)
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830 864
LAND HELD FOR INVESTMENT, at cost 7,048 7,127
(net of accumulated depreciation of $508
in 1995 and $461 in 1994)
NOTES RECEIVABLE (net of deferred
gain of $664 in 1995 and $654 in 1994) 978 1,065
CASH AND CASH EQUIVALENTS 171 111
U.S. GOVERNMENT SECURITIES, at cost 218 170
RECEIVABLES 19 18
PREPAID EXPENSES 20 35
OTHER ASSETS,
-At lower of cost or market (net of valuation
allowance of $0 in 1995 and 1994) 53 32
-Marked to market (including unrealized depreciation of
of $92 in 1995 and $13 in 1994) (27) 246
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TOTAL ASSETS $ 9,310 $ 9,668
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LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------------------------------------------------------------
NOTES PAYABLE 125 161
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES 47 34
REVERSE SPLIT LIABILITY 34 35
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TOTAL LIABILITIES 206 230
SHAREHOLDERS' EQUITY:
Common stock $1.00 par value, authorized
50,000 shares, issued 47,641 in 1995 and 1994. 476 476
Capital in excess of par value 14,756 14,756
Treasury stock, at cost
(1995 - 18,553 shares; 1994 - 18,798 shares) (5,005) (5,046)
Retained deficit (1,123) (748)
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TOTAL SHAREHOLDERS' EQUITY 9,104 9,438
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 9,310 $ 9,668
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The accompanying notes are an integral part of these financial statements.
3
ALASKA NORTHWEST PROPERTIES INC.
STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(amounts in thousands except # of shares and per share data) 1995 1994
------- -------
REVENUES
Interest Income $18 $37
Building and Land Rents 77 78
Other Income 1 14
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96 129
EXPENSES
Operating Expenses 91 96
General & Adminstrative Expenses 53 56
Interest Expense 1 2
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145 154
OTHER INCOME (EXPENSE)
Gain (loss) on sale of securities, commodities and futures (117) 15
Gain on sale of real estate 5 0
Unrealized depreciation on assets marked to market 65 (5)
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(47) 10
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LOSS FROM OPERATIONS BEFORE INCOME TAXES (96) (15)
PROVISION FOR INCOME TAXES 0 0
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NET LOSS $(96) $(15)
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------- -------
AVERAGE SHARES OUTSTANDING 29,088 28,698
NET LOSS PER COMMON SHARE: $(3.30) $(0.52)
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The accompanying notes are an integral part of these financial statements.
4
ALASKA NORTHWEST PROPERTIES INC.
STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(amounts in thousands except # of shares and per share data) 1995 1994
---------- ----------
REVENUES
Interest Income $69 $54
Building and Land Rents 183 101
Other Income 6 11
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258 166
EXPENSES
Operating Expenses 279 211
General & Administrative Expenses 192 189
Interest Expense 4 4
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475 404
OTHER INCOME (EXPENSE)
Gain (loss) on sale of securities, commodities and futures (115) 43
Gain on sale of real estate 46 0
Unrealized appreciation (depreciation) on assets marked to
market (92) 55
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(161) 98
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LOSS FROM OPERATIONS BEFORE INCOME TAXES (378) (140)
PROVISION FOR INCOME TAXES 0 0
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NET LOSS $(378) $(140)
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AVERAGE SHARES OUTSTANDING 29,088 28,702
NET LOSS PER COMMON SHARE: $(13.00) $(4.88)
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The accompanying notes are an integral part of these financial statements.
5
ALASKA NORTHWEST PROPERTIES INC.
STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995
Common Stock
------------------------------
Net
Capital in Unrealized
$1.00 Par Excess of Treasury Retained Loss on
(amounts in thousands) Value Par Value Stock Deficit Other Assets
- ---------------------- --------- ---------- -------- -------- ------------
BALANCES AT
DECEMBER 31, 1994 $476 $14,756 $(5,047) $(747) $0
Net loss for
the nine months ended
September 30, 1995 (378)
Treasury shares:
Purchased 1
Sold 41
Unclaimed dividends 2
Recovery of unrealized
loss on other assets. 0
--------- ---------- -------- -------- ------------
BALANCES AT
SEPTEMBER 30, 1995 $476 $14,756 $(5,005) $(1,123) $0
--------- ---------- -------- -------- ------------
--------- ---------- -------- -------- ------------
The accompanying notes are an integral part of these financial statements.
6
ALASKA NORTHWEST PROPERTIES INC.
STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(amounts in thousands) Net increase (decrease) in cash
1995 1994
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Cash flows from operating activites:
Net loss $(378) $(140)
Adjustments to reconcile net loss to cash:
Depreciation and amortization 108 81
Loss (gain) on disposition of assets 115 (43)
Unrealized depreciation (appreciation) on other assets marked to market 92 (55)
Income tax or tax benefits paid 0 3
Increase in accounts payable and accrued liabilities 12 48
Increase in accounts receivable (1) (4)
Increase in prepaid expenses 15 6
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Total Adjustments 341 36
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Net cash used in operating activites $(37) $(104)
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Cash flows from investing activities:
Proceeds from disposal of assets 48 0
Collection of notes receivable - net of reserve 77 20
Increase in notes receivable 10 0
Maturing U.S. Government securities 316 123
Acquisition of U.S. Government securities (363) (171)
Addition to property and equipment (44) 0
Sale of other assets - net 45 46
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Net cash from in investing activities $89 $18
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Cash flows from financing activities:
Fractional share purchases 1 1
Treasury stock sales and purchases 41 2
Decrease in long term debt (36) (33)
Unclaimed dividend 2 0
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Net cash used in financing activities $8 $(30)
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Net increase (decrease) in cash and cash equivalents 60 (116)
Cash and cash equivalents:
Beginning of period 111 198
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End of period $171 $82
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The accompanying notes are an integral part of these financial statements.
7
ALASKA NORTHWEST PROPERTIES INC.
CERTAIN DISCLOSURES TO FINANCIAL STATEMENTS
NOTE 1. RECLASSIFICATIONS.
Certain reclassification's have been made to prior year's financial statements
to conform to the current format.
NOTE 2. STATEMENT OF CASH FLOWS.
A) Supplemental schedule of non-cash investing and financing activities:
There were no noncash investing and financing activities during the third
quarter of 1995.
B) Supplemental disclosures of cash flows information:
Cash paid during the YEAR for
1995 1994
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Interest $4,045 $5,023
Income Tax (Alternative Minimum Tax) 0 2,845