10-year

10-Year Anniversary Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Once a decade discount

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

American Realty Investors Inc. Reports Operating Results (10-Q)

August 16, 2010 | About:
10qk

10qk

18 followers
American Realty Investors Inc. (ARL) filed Quarterly Report for the period ended 2010-06-30.

American Realty Investors Inc. has a market cap of $93.15 million; its shares were traded at around $7.99 with and P/S ratio of 0.51.

Highlight of Business Operations:

Rental and other property revenues were $41.6 million for the three months ended June 30, 2010. This represents a decrease of $2.8 million, as compared to the prior period revenues of $44.4 million. This change, by segment, is a decrease in the apartment portfolio of $1.0 million, a decrease in the commercial portfolio of $1.0 million, a decrease in the hotel portfolio of $0.6 million, and a decrease in the land and other portfolio of $0.2 million. Within the apartment portfolio, there was an increase of $1.0 million due to the developed properties in the lease up phase, offset by a $2.0 million decrease in the same property portfolio. Within the commercial portfolio the decrease was attributable to a $1.0 million decrease from the same properties due to an increase in vacancy, which we attribute to the current state of the economy. Revenues from our same hotel portfolio are also suffering due to the economy with decreased stays from travelers. We have directed our efforts to apartment development and put some additional land projects on hold until the economic conditions turn around. We are continuing to market our properties aggressively to attract new tenants and strive for continuous improvement of our properties in order to maintain our existing tenants.

Property operating expenses were $26.8 million for the three months ended June 30, 2010. This represents an increase of $3.7 million, as compared to the prior period operating expenses of $23.1 million. This change, by segment, is an increase in our apartments of $1.3 million, an increase in our commercial properties of $0.4 million, and an increase in our land and other segments of $2.4 million, offset by a decrease in our hotels of $0.4 million. Within the apartment portfolio, the same apartment properties increased by $1.1 million and the developed apartments increased expenses by $0.2 million. Within the same properties, there was an increase of $1.9 million related to those damaged in Galveston, Texas by Hurricane Ike that offset the prior quarters expenses for the same amount. There was a decrease of $0.8 million in overall costs and additional repairs and maintenance. The increase within the land and other portfolios was primarily due to an adjustment to correct over accrual of 2008 real estate property taxes recorded in the prior period, resulting in lower operating expenses. In the current period, we incurred additional real estate tax penalties and interest that we did not incur in the prior period. The decrease in our hotel portfolio is due to the decrease in variable costs that are directly associated with stays within the hotel.

Loss on land sales was ($4.1) million for the three months ended June 30, 2010. This represents a decrease of $12.1 million as compared to the prior period gain of $8.0 million. The decrease was due to recording a loss of ($5.2) million on the sale of 16.79 acres of land known as Ewing 8 land offset by a gain of $1.1 million on the sale of 6.77 acres of land known as McKinney Corners II land in the current period. In the prior period, we sold 3.02 acres of land known as West End land for a gain $4.9 million. In addition, we sold 3.13 acres of Verandas at City View land for a gain of $0.7 million, sold 3.96 acres of land known as Teleport land for a gain of $0.4 million, sold interest in Southwood land for a gain of $0.5 million and sold 8.23 acres of land known as Leone land for a gain on $1.5 million.

For the six months ended June 30, 2010, we reported a net loss applicable to common shares of ($26.9) million or ($2.33) per diluted earnings per share, as compared to a net loss applicable to common shares of ($36.1) million or ($3.14) per diluted earnings per share for the same period ended 2009.

Rental and other property revenues were $85.9 million for the six months ended June 30, 2010. This represents a decrease of $3.8 million, as compared to the prior period revenues of $89.7 million. This change, by segment, is a decrease in the apartment portfolio of $0.3 million, a decrease in the commercial portfolio of $2.5 million, a decrease in the hotel portfolio of $1.6 million and a decrease in the land portfolio of $0.3 million, offset by an increase in the other portfolio of $0.9 million. Within the commercial portfolio, the $2.5 million decrease from the same properties was due to an increase in vacancy, which we attribute to the current state of the economy. Revenues from our same hotel portfolio are also suffering due to the economy with decreased stays from travelers. We have directed our efforts to apartment development and put some additional land projects on hold until the economic conditions turn around. We are continuing to market our properties aggressively to attract new tenants and strive for continuous improvement of our properties in order to maintain our existing tenants.

Property operating expenses were $52.8 million for the six months ended June 30, 2010. This represents an increase of $1.2 million, as compared to the prior period operating expenses of $51.6 million. This change, by segment, is an increase in our commercial properties of $0.2 million and an increase in our land and other segments of $2.8 million, offset by a decrease in our apartments of $1.1 million and a decrease in our hotels of $0.7 million. Within the apartment portfolio, the same apartment properties decreased $1.9 million due to a decrease in overall costs and additional repairs and maintenance. The developed apartments increased expenses by $0.8 million. We have directed our efforts to apartment development and put some additional land projects on hold until the economic conditions turn around. The decrease in our hotel portfolio is due to the decrease in variable costs that are directly associated with stays within the hotel.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 3.0/5 (2 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK