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Vestin Realty Mortgage I, Inc. Reports Second Quarter Financial Results
Posted by: gurufocus (IP Logged)
Date: August 14, 2009 02:31PM
Press Release: Vestin Realty Mortgage I, Inc. Reports Second Quarter Financial Results
LAS VEGAS--(BUSINESS WIRE)--Vestin Realty Mortgage I, Inc. (Nasdaq:VRTA) reported a net loss for the second quarter ended June 30, 2009 of approximately $3.2 million, or ($0.49) per share, on revenues of approximately $0.5 million, compared with a net loss of approximately $4.8 million or ($0.70) per share on revenues of approximately $1.3 million in the comparable period in 2008. In addition, VRTA reported a net loss for the six months ended June 30, 2009 of approximately $4.7 million, or ($0.72) per share, on revenues of approximately $0.8 million, compared with a net loss of approximately $5.3 million or ($0.78) per share on revenues of approximately $2.4 million in the comparable period in 2008.
The Company noted that the losses for the three and six months ended June 30, 2009, were in significant part due to the level of non-performing loans and increase in properties acquired through foreclosure. As of June 30, 2009, the Company had 25 loans outstanding with an aggregate principal amount approximating $40.4 million, of which 11 loans with an aggregate principal amount approximating $27.7 million were considered non-performing. As of June 30, 2008, the Company had 31 loans outstanding with an aggregate principal amount approximating $54.0 million, of which 12 loans with an aggregate principal amount approximating $25.1 million were considered non-performing. Loans are considered non-performing when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement or when the payment of interest is 90 days past due. In addition, as of June 30, 2009, we owned nine properties, with an aggregate book value of approximately $3.5 million that we have acquired through foreclosure, compared with four properties owned with an aggregate book value of approximately $4.1 million, as of June 30, 2008.
The Company recorded loan loss provisions and write downs on real estate held for sale of approximately $2.1 million and $1.8 million, respectively, for the six months ended June 30, 2009. In addition, the Company incurred professional fees of approximately $1.1 million, primarily due to the legal fees relating to the legal actions that have been filed against us in connection with the REIT conversion. The loan loss provisions and write downs on real estate held for sale are non-cash items. Net cash flow used in operating activities was approximately $0.2 million.
As of June 30, 2009, shareholder equity was $4.96 per common share. The Company had on its balance sheet as of June 30, 2009, $1.9 million of cash, $27.3 million of investment in real estate loans, net of allowance of $13.1 million, $3.5 million in real estate held for sale and $1.3 million in total liabilities.
About Vestin Realty Mortgage I, Inc.
Vestin Realty Mortgage I, Inc. is a real estate investment trust (“REIT”) that invests in commercial real estate loans. As of June 30, 2009, Vestin Realty Mortgage I, Inc. had assets of approximately $34.0 million. Vestin Realty Mortgage I, Inc. is managed by Vestin Mortgage, Inc., which is a subsidiary of Vestin Group, Inc., which is engaged in asset management, real estate lending and other financial services through its subsidiaries. Since 1995, Vestin Mortgage Inc. has facilitated more than $2.0 billion in lending transactions.
Certain information discussed in this press release may constitute forward-looking statements within the Private Securities Litigation Reform Act of 1995 and the federal securities laws. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, it can give no assurance that its expectations will be achieved. Readers are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are inherently subject to unpredictable and unanticipated risks, trends and uncertainties, such as the Company’s potential inability to accurately forecast its operating results; the Company’s potential inability to regain profitability or continue to generate positive cash flow from operations; constraints in the credit markets, the availability of take-out financing for our borrowers; defaults on outstanding loans; unexpected difficulties encountered in pursuing our remedies if a loan is in default; a decline in the value of collateral securing our loans, declining real estate values in the markets we serve and other risks associated with the Company’s business. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.
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