Transcontinental Realty Investors, Inc. (NYSE: TCI), a Dallas-based real estate investment company, today reported results of operations for the year ended December 31, 2009. TCI reported a net loss applicable to common shares of $80.7 million or $9.95 per share in 2009, as compared to prior year net income applicable to common shares of $31.2 million or $3.86 per share. Net loss for the three months ended December 31, 2009 was $26.0 million or $3.20 per share, as compared to prior year net loss applicable to common shares of $14.5 million or $1.80 per share.

Results of operations for the year ended December 31, 2009 as compared to the same period ended 2008;

Rental revenues were $151.6 million for the twelve months ended December 31, 2009. The rental revenues for 2009, as compared to the same period in 2008, increased by $13.3 million, of which the apartment portfolio increased by $11.4 million, the commercial portfolio increased by $3.9 million and the land portfolio decreased $1.1 million with the remaining $0.9 million decrease in our other portfolios.

Depreciation expense was $29.1 million for the twelve months ended December 31, 2009. The depreciation expense for 2009, as compared to the same period in 2008, increased by $4.7 million of which the apartment portfolio increased by $3.4 million with the remainder due to the commercial portfolio.

The provision on impairment of notes receivable, investment in real estate partnerships, and real estate assets was $42.5 million for the twelve months ended December 31, 2009. The provision on impairment of notes receivable, investment in real estate partnerships, and real estate assets for 2009, as compared to the same period in 2008, increased by $35.1 million.

Interest income was $5.4 million for the twelve months ended December 31, 2009. The interest income recorded for 2009, as compared to the same period in 2008, increased by $2.2 million due to the receipt of interest payments due on our Unified Housing surplus cash flow notes. Interest is recognized when interest payments are received.

Mortgage and loan interest was $70.2 million for the twelve months ended December 31, 2009. The mortgage and loan interest for 2009, as compared to the same period in 2008, decreased by $2.9 million which is due to an increase in the apartments of $1.8 million, a decrease in the commercial portfolio of $1.5 million, an increase in the land portfolio of $0.7 million and a decrease in the other portfolios of $3.9 million.

Gain on the sale of land was $6.3 million for the twelve months ended December 31, 2009. The gain on the sale of land for 2009, as compared to the same period in 2008, increased by $1.5 million due to an increase in land sales.

Income from discontinued operations was $2.2 million for the year ended 2009 as compared to the $62.4 million for the same period ended 2008. Included in discontinued operations are a total of seven and 25 income-producing properties as of 2009 and 2008, respectively.

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 office buildings, apartments, hotels, shopping centers and developed and undeveloped land. We invest in real estate through direct equity ownership and partnerships nationwide. For more information, visit the Company’s web site at www.transconrealty-invest.com.
   
 
 
 
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
 
 
For the Years Ended December 31,
2009 2008
(dollars in thousands, except share and per share amounts)
Revenues:
Rental and other property revenues $ 151,647 $ 138,337
 
Expenses:
Property operating expenses 85,087 86,237
Depreciation and amortization 29,098 24,377
General and administrative 11,063 10,349
Provision on impairment of notes receivable and real estate assets 42,513 7,417
Advisory fee to affiliate   11,903     12,064  
Total operating expenses   179,664     140,444  
Operating income (loss) (28,017 ) (2,107 )
 
Other income (expense):
Interest income 5,407 3,227
Other income 3,631 3,918
Mortgage and loan interest (70,157 ) (73,053 )
Earnings from unconsolidated subsidiaries and investees (451 ) (1,096 )
Involuntary conversion - -
Litigation Settlement   356     -  
Total other expenses   (61,214 )   (67,004 )
Loss before gain on land sales, non-controlling interest, and tax (89,231 ) (69,111 )
Gain on land sales   6,296     4,798  
Loss from continuing operations before tax (82,935 ) (64,313 )
Income tax benefit (expense)   1,180     33,441  
Net income (loss) from continuing operations   (81,755 )   (30,872 )
Discontinued operations:
Loss from discontinued operations (162 ) (8,368 )
Gain on sale of real estate from discontinued operations 3,524 104,411
Income tax expense from discontinued operations   (1,180 )   (33,616 )
Net income (loss) (79,573 ) 31,555
Net income (loss) attributable to non-controlling interest   (125 )   654  
Net income (loss) attributable to Transcontinental Realty Investors, Inc. (79,698 ) 32,209
Preferred dividend requirement   (1,023 )   (975 )
Net income (loss) applicable to common shares $ (80,721 ) $ 31,234  
 
Earnings per share - basic
Gain (loss) from continuing operations $ (10.22 ) $ (3.86 )
Discontinued operations   0.27     7.72  
Net income (loss) applicable to common shares $ (9.95 ) $ 3.86  
 
Earnings per share - diluted
Gain (loss) from continuing operations $ (10.22 ) $ (3.86 )
Discontinued operations   0.27     7.72  
Net income (loss) applicable to common shares $ (9.95 ) $ 3.86  
 
Weighted average common share used in computing earnings per share 8,113,669 8,086,640
Weighted average common share used in computing diluted earnings per share 8,113,669 8,086,640
 
 
Amounts attributable to Transcontinental Realty Investors, Inc.
Income (loss) from continuing operations $ (81,755 ) $ (30,872 )
Income from discontinued operations   2,182     62,427  
Net income (loss) $ (79,573 ) $ 31,555  
   
 
 
 
TRANSCONTINENTAL REALTY INVESTORS, INC.
CONSOLIDATED BALANCE SHEETS
   
 
December 31, December 31,
2009 2008
(dollars in thousands, except share and par value amounts)
Assets
Real estate, at cost $ 1,520,043 $ 1,526,016
Real estate held for sale at cost, net of depreciation 5,147 8,018
Real estate subject to sales contracts at cost, net of depreciation 59,048 60,807
Less accumulated depreciation   (137,054 )   (114,050 )
Total real estate 1,447,184 1,480,791
Notes and interest receivable
Performing 48,051 42,413
Less allowance for estimated losses   (2,804 )   (3,293 )
Total notes and interest receivable 45,247 39,120
Cash and cash equivalents 5,665 5,983
Investments in securities - 2,775
Investments in unconsolidated subsidiaries and investees 9,358 23,365
Other assets   100,833     88,033  
Total assets $ 1,608,287   $ 1,640,067  
 

Liabilities and Shareholders’ Equity
Liabilities:
Notes and interest payable $ 1,121,737 $ 1,100,852
Notes related to assets held-for-sale 5,002 4,191
Notes related to subject to sales contracts 61,886 62,972
Affiliate payables 50,163 62,367
Accounts payable and other liabilities   124,083     84,989  
1,362,871 1,315,371
Commitments and contingencies:
Shareholders’ equity:
Preferred Stock, Series C: $.01 par value, authorized 10,000,000 shares, issued and outstanding 30,000 shares in 2009 and 2008 respectively (liquidation preference $100 per share). Series D: $.01 par value, authorized, issued and outstanding 100,000 shares in 2009 and 2008 respectively 1 1
Common Stock, $.01 par value, authorized 10,000,000 shares; issued and outstanding 8,113,669 for 2009 and 2008 81 81
Paid-in capital 262,118 263,290
Retained earnings (34,718 ) 44,980
Accumulated other comprehensive income   -     2,575  
Total Transcontinental Realty Investors, Inc. shareholders' equity 227,482 310,927
Non-controlling interest   17,934     13,769  
Total equity   245,416     324,696  
Total liabilities and equity $ 1,608,287   $ 1,640,067  

Copyright Business Wire 2010

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