Transcontinental Realty Investors, Inc. (NYSE: TCI), is
reporting its results of operations for the quarter ended September
30, 2020. For the three months ended September 30, 2020, the
Company reported a net income applicable to common shares of $7.7
million or $0.88 per diluted share, compared to a net loss
applicable to common shares of $7.8 million or $0.89 per diluted
share for the same period in 2019.
COVID-19
The Company continues to closely monitor the impact of the
COVID-19 pandemic on all aspects of its business. COVID-19 did not
have a significant impact on the Company’s results of operations or
cash flows during the three months ended September 30, 2020.
- The Company collected approximately 96% of its second quarter
rents, comprised of approximately 95% from multi-family tenants and
approximately 97% from office tenants.
- The Company did not grant any abatements or significant
deferments of rents.
- Occupancy remains stable at 91% at September 30, 2020 and
2019.
- The Company continued to obtain positive leasing spreads for
new leases and renewals at it properties.
- Ongoing development projects continued during the quarter
unabated without work stoppages. In addition, the Company is
evaluating several new development projects.
The future impact of COVID-19 on the Company’s business and
financial activities will depend on future developments, which at
this stage are unpredictable considering the fluctuations of
COVID-19 outbreaks and the resulting changes in the markets.
Financial Results
Rental revenues were $11.5 million for the three months ended
September 30, 2020, compared to $11.4 million for the three months
ended September 30, 2019. For 2020, we generated revenues of $7.8
million and $3.7 million from our commercial and multifamily
segments respectively.
Net operating (loss) was ($1.5) million for the three months
ended September 30, 2020, compared to $0.4 million for the same
period in 2019. The $1.9 million increase in net operating loss is
primarily due to the placement in service of two new multifamily
apartment communities in 2020. Operating expense of new properties
generally exceed their rental revenues during initial lease-up.
Interest income was $4.3 million for three months ended
September 30, 2020, compared to $5.2 million for the same period in
2019. The decrease of $0.9 million in interest income was primarily
due to collection on notes receivable in 2020.
Interest expense was to $6.3 million for the three months ended
September 30, 2020, compared to $8.0 million for the same period in
2019. The $1.7 million decrease in interest expense was primarily
due to the refinancing of the mortgage note payable on Browning
Place in 2019.
Loss on foreign currency transactions was a loss of $1.5 million
for the three months ended September 30, 2020 as compared to $5.2
million for the same period in 2019. The decrease is foreign
currency loss was due a decrease in the exchange rate from U.S.
Dollars to the Israel Shekel offset in part by a reduction in the
bonds outstanding.
Gain on sale or write-down of assets increased $7.2 million for
the three months ended September 30, 2020, compared the same period
in 2019. The increase is primarily due to the sale Bridgeview Plaza
for $5.3 million, resulting in a gain of $4.8 million in 2020, and
the sale of Farnham Park Apartments for $13.3 million, resulting in
a gain of $2.7 million.
About Transcontinental Realty Investors, Inc.
Transcontinental Realty Investors, Inc., a Dallas-based real
estate investment company, holds a diverse portfolio of equity real
estate located across the U.S., including apartments, office
buildings, shopping centers, and developed and undeveloped land.
The Company invests in real estate through direct ownership, leases
and partnerships and invests in mortgage loans on real estate. For
more information, visit the Company’s website at
www.transconrealty-invest.com.
TRANSCONTINENTAL REALTY INVESTORS, INC. CONSOLIDATED
STATEMENTS OF OPERATIONS (dollars in thousands, except per
share amounts) (Unaudited) For the Three
Months EndedSeptember 30, For the Nine Months EndedSeptember
30,
2020
2019
2020
2019
Revenues: Rental revenues (including $262 and $212 for the
three months and $673 and $527 for the nine months ended 2020 and
2019, respectively, from related parties)
$
11,453
$
11,407
$
34,461
$
34,352
Other income
706
1,990
3,885
7,394
Total revenues
12,159
13,397
38,346
41,746
Expenses: Property operating expenses (including $254 and
$237 for the three months ended and $750 and $741 for the nine
months ended 2020 and 2019, respectively, from related parties)
6,388
5,403
18,507
18,722
Depreciation and amortization
3,526
3,416
10,338
9,964
General and administrative (including $1,017 and $935 for the three
months ended and $2,783 and $3,355 for the nine months ended 2020
and 2019, respectively, from related parties)
1,643
1,929
7,063
6,468
Advisory fee to related party
2,139
2,200
6,483
6,196
Total operating expenses
13,696
12,948
42,391
41,350
Net operating (loss) income
(1,537
)
449
(4,045
)
396
Interest income (including $3,752 and $4,618 for the three
months ended and $11,255 and $13,483 for the nine months ended 2020
and 2019, respectively, from related parties)
4,348
5,232
13,102
14,668
Interest expense (including $380 and $514 for the three months
ended and $1,193 and $1,517 for the nine months ended 2020 and
2019, respectively, from related parties)
(6,291
)
(8,037
)
(21,999
)
(23,642
)
(Loss) gain on foreign currency transaction
(1,470
)
(5,153
)
774
(13,296
)
Loss on extinguishment of debt
-
(5,219
)
-
(5,219
)
Income (losses) from unconsolidated joint ventures
365
(178
)
(740
)
(1,474
)
Gain on sales or write-down of assets
12,328
5,140
21,802
9,409
Income tax expense
(50
)
-
(346
)
-
Net income (loss)
7,693
(7,766
)
8,548
(19,158
)
Net income attributable to non-controlling interest
-
(21
)
(400
)
(583
)
Net income (loss) attributable to common shares
$
7,693
$
(7,787
)
$
8,148
$
(19,741
)
Earnings (loss) per share - attributable to common
shares Basic and diluted
$
0.88
$
(0.89
)
$
0.93
$
(2.26
)
Weighted-average number of common shares outstanding: Basic
and diluted
8,717,767
8,717,767
8,717,767
8,717,767
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS (dollars in thousands, except
share and par value amounts) (Unaudited)
September 30, 2020 December 31, 2019
Assets
Real estate, net
$
380,715
$
387,790
Notes receivable (including $66.287 in 2020 and $57,817 in 2019
from related parties)
123,854
112,357
Cash and cash equivalents
32,967
51,179
Restricted cash
28,030
32,082
Investment in unconsolidated joint ventures
71,171
81,780
Receivable from related parties
140,050
141,541
Other assets
68,558
59,189
Total assets
$
845,345
$
865,918
Liabilities and Equity
Liabilities: Mortgages and notes payable
$
242,300
$
245,773
Bonds payable
203,192
223,265
Accounts payable and other liabilities (including $937 in 2020 and
$935 in 2019 to related parties)
24,642
26,115
Accrued interest payable
3,281
7,230
Deferred revenue
9,315
9,468
Total liabilities
482,730
511,851
Equity Shareholders' Equity: Common stock, $0.01 par value,
authorized 10,000,000 shares; issued 8,717,967 shares at September
30, 2020 and December 31, 2019.
87
87
Treasury stock at cost, 200 shares in 2020 and 2019
(2
)
(2
)
Paid-in capital
257,853
257,853
Retained earnings
82,813
74,665
Total shareholders' equity
340,751
332,603
Non-controlling interest
21,864
21,464
Total equity
362,615
354,067
Total liabilities and equity
$
845,345
$
865,918
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201112006104/en/
Transcontinental Realty Investors, Inc. Investor Relations Erik
Johnson (469) 522-4200
investor.relations@transconrealty-invest.com
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