IMMEDIATE RELEASE
Wednesday, March 31, 1999
CALPROP REPORTS FOURTH QUARTER
AND YEAREND RESULTS
CALPROP REPORTS $5.4 MILLION IN PROFITS IN 1998
MARINA DEL REY, CA, MARCH 31, 1999 -- Calprop Corporation (OTCBB:CLPO), a
California and Colorado home builder, in reporting financial results for the
three and twelve month periods ended December 31, 1998, today reported that it
has earned a net profit from operations for both the three and twelve month
periods ended December 31, 1998.
"For both the three and twelve month periods ended December 31, 1998,
Calprop recognized a profit from operations. This is our third profitable
quarter in succession as the Northern and Southern California markets continue
to provide robust housing sales. Though we closed 50 units this quarter, our
total units in backlog remain high at 123 units, $29,835,000, up 27.7% from 114
units, $23,372,000 a year ago. This backlog and the commencement of the
development of two projects in the last ninety days is the impetus for
recognizing the $2,443,700 in benefit for income taxes," said Victor Zaccaglin,
Calprop's chairman and chief executive officer.
For the fourth quarter, Calprop's revenues were $10.6 million, an
increase of $7.0 million or 197.8% from $5.1 million of revenues in the fourth
quarter a year ago. Income from development operations was $887,351 for the
fourth quarter, up $864,720 or 3821.0% compared to the $22,631 in the same
quarter in the prior year. Net income for the fourth quarter of 1998 was
$2,896,652 or $0.27 per share on 10,465,459 weighted average shares and common
stock equivalents, compared with a net loss of ($284,991), or ($0.03) per share
on 9,298,477 weighted average shares and common stock equivalents, in the same
quarter a year ago. The improved results were primarily driven by an increase in
construction gross margin and the recognition of $2,443,700 in benefit for
income taxes.
For the year-to-date period, revenues were $33.1 million, up 44.4% from
$22.9 million in 1997. Income from development operations was $2,627,524 for the
twelve months ended December 31, 1998, up $2,572,822 or 4703.3% compared to
$54,702 for the same period in the prior year. The company reported net income
of $5,368,006, or $0.52 per share on 10,281,295 weighted average shares and
common stock equivalents, for the twelve months ended December 31, 1998,
compared with a net loss of ($1,620,211), or ($0.18) per share on 9,242,386
weighted average shares and common stock equivalents, in the same period in
1997. The improved results were primarily driven by an increase in contribution
margin to 7.94% up from 0.24% during the same period in the prior year and the
recognition of $4,773,700 in benefit for income taxes.
"At year end 1998, we had a total of 196 single-family residences and
918 lots under development. This compares with 160 residences and 317 lots a
year earlier. Real estate under development was $65,282,197 as of December 31,
1998, up $35,980,237 or 122.8% compared to
$26,325,978 as December 31, 1997. This increase reflects the the positive
impact of the purchase of six new developments in 1998 and the conversion of
land held for investment, $2,975,982, to real estate under under
development," Zaccaglin stated.
At December 31, 1998, shareholders' equity was $8,459,521, or $0.82 per
share on 10,281,295 weighted average shares and common stock equivalents
compared with $2,756,610, or $0.30 per share in 1997. Cash balances of $1.5
million are comparable with last year. Trust deeds and notes payable was
$58,394,793, up $38,962,155 or 200.5% compared to $19,432,638 in 1997. The
Company's debt-to-equity ratio increased to 4.3 to 1, up from 2.37 to 1 in the
prior year.
"The Company purchased six new developments during 1998, Parc
Metropolitan, a 382 unit development in Milpitas, California, comprised of three
distinct products, High Ridge Court, a 170 lot development in Thornton,
Colorado, Bay Hill at Saddlerock, a 94 lot development in Aurora, Colorado and
Templeton Heights, a 54 lot development in Colorado Springs, Colorado.
Furthermore, we have began developing a long held asset, Creekside at
Mockingbird Canyon, a 31 lot development in the Riverside County area,
California. Presently, all of these except Templeton Heights are under
construction. Additionally, Calprop has entered into escrow to acquire three
projects, two in California and the other in Colorado; South Street, a 92 unit
development in San Luis Obispo, California, McGuire property, a 182 unit
development in San Diego, California and Templeton Heights II, a 84 unit
development in Colorado Springs, Colorado. Both of the California developments
are scheduled to commence in 1999. I look to 1999 as a year to build upon the
success of 1998 and continue to both increase revenues and enhance the Company's
profitability, " Zaccaglin stated.
Calprop builds quality homes in some of the most desirable communities
in both California and Colorado. The Company's common stock is traded on the OTC
Bulletin Board under the symbol CLPO.
(TABLE FOLLOWS)
CALPROP CORPORATION
STATEMENTS OF OPERATIONS
(Unaudited)
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
-------------------------------- -------------------------------
1998 1997 1998 1997
-------------- -------------- -------------- --------------
Development operations:
Real estate sales 10,612,910 3,563,375 33,071,722 22,908,649
Cost of real estate sales 9,725,559 3,574,413 30,444,198 22,853,947
-------------- -------------- -------------- --------------
Income (loss) from development operations 887,351 (11,038) 2,627,524 54,702
Other income 27,873 29,326 87,405 91,738
Other expenses:
General and administrative expenses 467,111 418,214 1,752,909 1,444,096
Interest expense 5,768 88,997 135,081 339,766
Investment property holding costs -- -- -- 185,838
-------------- -------------- -------------- --------------
Total other expenses 472,879 507,211 1,887,990 1,969,700
Minority interests 26,195 (18,075) 232,633 (17,192)
-------------- -------------- -------------- --------------
Income (loss) before benefit for income taxes 416,150 $(470,848) 594,306 $(1,806,068)
Benefit for income taxes 2,443,700 185,857 4,773,700 185,857
-------------- -------------- -------------- --------------
Net income (loss) $2,859,850 $(284,991) $5,368,006 $(1,620,211)
Net income (loss) allocable to common stock $2,859,850 $(284,991) $5,368,006 $(1,620,211)
Diluted income (loss) per share $0.27 $(.03) $0.52 $(.18)
Weighted average shares of common stock 10,465,459 9,298,477 10,281,295 9,242,386
UNITS SOLD:
SINGLE-FAMILY HOMES 50 18 162 71
TOWNHOMES 0 0 0 31
- - - --
TOTAL 50 18 162 102
- MORE -
CALPROP CORPORATION
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1998 AND 1997
Assets
1998 1997
--------------------------------------------
REAL ESTATE UNDER DEVELOPMENT $65,282,197 $26,325,978
INVESTMENT IN LAND -- 2,975,982
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TOTAL INVESTMENT IN REAL ESTATE 65,282,197 29,301,960
--------------------------------------------
OTHER ASSETS:
Cash and cash equivalents 1,590,403 1,100,028
Prepaid expenses 88,775 23,149
Deferred and other assets 4,800,000 --
Other assets 760,514 531,665
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Total other assets 7,239,692 1,654,842
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Total assets $72,521,889 $30,956,802
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Liabilities and Stockholders' Equity
1998 1997
--------------------------------------------
TRUST DEEDS AND NOTES PAYABLE $37,524,507 $6,713,809
RELATED PARTY NOTES 20,870,286 12,718,829
--------------------------------------------
Total trust deeds and notes payable 58,394,793 19,432,638
COMMUNITY FACILITIES DISTRICT SPECIAL TAX BONDS -- 2,336,544
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES 5,056,010 3,954,885
WARRANTY RESERVES 284,624 288,278
--------------------------------------------
Total liabilities 63,735,427 26,012,345
MINORITY INTEREST 326,941 2,187,847
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, no par value; 20,000,000 shares authorized;
10,284,135 and 9,304,785 shares issued and outstanding at
December 31, 1998 and 1997, respectively 10,284,135 9,304,785
Additional paid-in capital 25,851,130 25,886,906
Deferred Compensation (241,130) (106,595)
Stock Purchase Loans (474,134) --
--------------------------------------------
Accumulated deficit (26,960,480) (32,328,486)
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Total Equity 8,459,521 2,756,610
--------------------------------------------
Total Stockholders' Equity and Liabilities $72,521,889 $30,956,802
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